S.F. Holding Co., Ltd. 2020 Semi-Annual Report
S.F. Holding Co., Ltd.
2020 Semi-Annual Report
August 2020
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
NoticeThe Company prepared its 2020 Semi-Annual Report in accordance with relevant regulations andguidelines set forth by the China Securities Regulatory Commission and the Shenzhen Stock Exchange,including the “Publicly Listed Company Information Disclosure Content and Format Guideline No. 3Semi-Annual Report Content and Format,” the “Shenzhen Stock Exchange Listing Rules,” the “ShenzhenStock Exchange Standard Operating Guidelines,” and the “Guidelines of the Shenzhen Stock Exchange onthe Business Handling of Listed Companies No. 2 – Matters Related to Periodic Disclosures.” TheCompany's 2020 Semi-Annual Report was prepared and published in Chinese and the English version isfor reference only. Should there be inconsistency between the Chinese version and the English version, theChinese version shall prevail. Investors can access the Company's 2020 Semi-Annual Report on Cninfo(www.cninfo.com.cn), which is designated by the China Securities Regulatory Commission for Publishingthe Semi-Annual Report.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
Chapter 1 Important Information, Table of Contents, and DefinitionsThe Company’s Board of Directors, Supervisory Committee, directors, supervisors, and senior managementhereby guarantee that the contents of the Semi-Annual Report are true, accurate, and complete, and that there areno misrepresentations, misleading statements, or material omissions, and shall assume individual and joint legalliabilities.
Wang Wei, the Company’s responsible person, NG Wai Ting, the person in charge of accounting work, and HuXiaofei, the person in charge of the accounting department (accounting officer), hereby declare and warrant thatthe financial report within the Semi-Annual Report is true, accurate, and complete.
All directors have attended the Board meeting approving the Semi-Annual Report.
Forward-looking statements such as future development plans in this report do not constitute the Company’spromise to investors. Investors are advised to invest rationally and to take into account possible investment risks.
The Company is required to comply with the disclosure requirements presented in the Shenzhen Stock Exchangefor Industrial Information Disclosure No.9 – Listed Companies Engaged in the Express Delivery ServicesBusiness.
In this Semi-Annual Report, the Company details the possible risk factors and countermeasures that may occur inthe future. For more information, refer to “Section X. Possible Risks and Countermeasures” in “Chapter 4.Management Discussion and Analysis of Business Operation.” Investors shall refer to this information.
The Company does not plan to issue cash or equity dividends, nor to convert equity reserve into share capital ofthe Company.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
Table of Contents
Chapter 1 Important Information, Table of Contents, and Definitions ...... 4
Chapter 2 Company Profile and Key Financial Indicators ...... 7
Chapter 3 Business Overview ...... 10
Chapter 4 Management Discussion and Analysis of Business Operation ...... 27
Chapter 5 Significant Events ...... 57
Chapter 6 Share Changes & Shareholder Details ...... 86
Chapter 7 Preferred Shares ...... 90
Chapter 8 Convertible Corporate Bonds ...... 91
Chapter 9 Directors, Supervisors and Senior Managers ...... 94
Chapter 10 Corporate Bonds ...... 95
Chapter 11 Financial Statements ...... 96
Chapter 12 List of Documents Available for Inspection ...... 281
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
Definitions
| Term | Description |
| Reporting period | January 1, 2020 to June 30, 2020 |
| The same period of previous year | January 1, 2019 to June 30, 2019 |
| The Company, The listed Company, SF Holding | S.F. Holding Co., Ltd., formerly known as Maanshan Dingtai Rare Earth and New Materials Co., Ltd. After completing a major asset restructuring (as defined below) in December 2016, it was officially renamed to S.F. Holding Co., Ltd. in February 2017. |
| RMB | Renminbi yuan |
| Mingde Holding | Shenzhen Mingde Holding Development Co., Ltd., the controlling shareholder of S.F. Holding Co., Ltd. |
| Dingtai New Materials | Maanshan Dingtai Rare Earth and New Materials Co., Ltd., The predecessor of S.F. Holding Co., Ltd., it was renamed to S.F. Holding Co., Ltd. in February 2017. |
| Taisen Holding | Shenzhen S.F. Taisen Holding (Group) Co., Ltd., a subsidiary of S.F. Holding Co., Ltd. |
| Shunda Fengrun | Ningbo Shunda Fengrun Venture Capital Partnership (Limited Partnership) |
| Jiaqiang Shunfeng | Jiaqiang Shunfeng (Shenzhen) Equity Investment Partnership (Limited Partnership) |
| Zhaoguang Investment | Shenzhen Zhaoguang Investment Co., Ltd. |
| Oriza Shunfeng | Suzhou Industrial Park Oriza Shunfeng Equity Investment Company (Limited Partnership) |
| Guyu Qiuchuang | Suzhou Guyu Qiuchuang Equity Investment Partnership (Limited Partnership) |
| Shunxin Fenghe | Ningbo Shunxin Fenghe Venture Capital Partnership (Limited Partnership) |
| Major asset restructuring | In December 2016, all assets and liabilities (exchange-out assets) of the Company’s predecessor, Dingtai New Materials, was replaced with the equivalent 100% equity (exchange-in assets) of Taisen Holding held by all shareholders of Taisen Holding as of December 31, 2015. The difference between the exchange-in assets and the exchange-out assets was purchased by Dingtai New Materials, the Company’s predecessor, from all shareholders of Taisen Holding, in the form of issuing shares. |
| Exchange-out assets | All assets and liabilities of the Company’s predecessor, Dingtai New Materials, as of December 31, 2015. |
| Exchange-in assets | 100% equity of Taisen Holding as of December 31, 2015. |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
Chapter 2 Company Profile and Key Financial Indicators
I. Company Profile
| Stock Abbreviation | SF Holding | Stock Code | 002352 |
| Listed Stock Exchange | Shenzhen Stock Exchange | ||
| Chinese Name of the Company | 顺丰控股股份有限公司 | ||
| Chinese Name Abbreviation of the Company | 顺丰控股 | ||
| English Name of the Company | S.F. Holding Co., Ltd. | ||
| English Name Abbreviation of the Company | SF Holding | ||
| Legal Representative of the Company | Wang Wei | ||
II. Contacts and Contact Methods
| Board Secretary | Securities Affairs Representative | |
| Name | Gan Ling | Zeng Jing |
| Address | Block B,TK Chuangzhi Tiandi Building, Keji South 1st Road, Nanshan District, Shenzhen, Guangdong Province, P.R.China | Block B,TK Chuangzhi Tiandi Building, Keji South 1st Road, Nanshan District, Shenzhen, Guangdong Province, P.R.China |
| Tel No. | 0755-36395338 | 0755-36395338 |
| Fax | 0755-36646688 | 0755-36646688 |
| sfir@sf-express.com | sfir@sf-express.com |
III. Other Information
1. Corporate Contact Information
Were there any changes to the Company’s registered address, office address or postal code, company website, orto the email address during the reporting period?
√Yes □No
| Registered Address | Room 801, Floor 8, Wanfu Building, No. 303 Fuyong Avenue, Bao’an District, Shenzhen, Guangdong Province , P.R.China |
| Zip Code of Registered Address | 518103 |
| Office Address | Block B,TK Chuangzhi Tiandi Building,Keji South 1st Road, Nanshan District, Shenzhen, Guangdong Province, P.R.China |
| Zip Code of Office Address | 518057 |
| Company Website | www.sf-express.com |
| sfir@sf-express.com | |
| Date of disclosure of the interim announcement as disclosed through the designated website (if any) | July 8, 2020 |
| Index for the interim announcement as disclosed through the designated website (if any) | Announcement on the Change of Office Address and Investor Relations Facsimile Number (2020-069) disclosed by the Company on Cninfo (http://www.cninfo.com.cn) |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
2. Information Disclosure and Location of Report
Were there any changes to information disclosure and location during the reporting period?
□ Yes √No
There were no changes to the name of the newspaper designated for information disclosure, to the address ofwebsite designated by the China Securities Regulatory Commission for semi-annual report publication, nor to thestorage location of company’s Semi-Annual report during the reporting period. Refer to the Company’s 2019Annual report for details.
IV. Key Accounting Information and Financial IndicatorsDoes the Company need to adjust its financial information retrospectively or restate its previous year accountinginformation?
√Yes □No
Rationale for retrospective adjustments or restatements
Business combination involving enterprises under common control
| Current reporting period | The same period of previous year | Increase/Decrease over the same period of previous year | |||
| Before restatements | After restatements | After restatements | |||
| Revenue (RMB) | 71,129,007,738.21 | 50,074,704,033.85 | 50,074,704,033.85 | 42.05% | |
| Net profit attributable to shareholders of the parent company (RMB) | 3,761,593,296.43 | 3,101,111,638.63 | 3,099,808,006.37 | 21.35% | |
| Net profit after deducting non-recurring profit or loss attributable to shareholders of the parent company (RMB) | 3,444,761,400.75 | 2,330,310,116.43 | 2,330,310,116.43 | 47.82% | |
| Net cash flow from operating activities (RMB) | 6,931,712,320.10 | 4,816,886,549.68 | 4,820,813,616.56 | 43.79% | |
| Basic earnings per share (RMB/share) | 0.85 | 0.70 | 0.70 | 21.43% | |
| Diluted earnings per share (RMB/share) | 0.85 | 0.70 | 0.70 | 21.43% | |
| Weighted average return on net assets | 8.51% | 8.23% | 8.20% | An increase of 0.31 percentage points | |
| End of the current reporting period | End of previous year | Increase/Decrease over previous year end | |||
| Before restatements | After restatements | After restatements | |||
| Total assets (RMB) | 102,045,830,669.00 | 92,535,386,807.84 | 92,535,386,807.84 | 10.28% | |
| Total equity attributable to shareholders of the parent company (RMB) | 46,854,381,588.06 | 42,419,713,739.80 | 42,419,713,739.80 | 10.45% | |
V. Differences arising from accounting standard of the PRC and the International AccountingStandards
1. Differences between net profits and net assets disclosed in the financial reports in accordance withChinese accounting standards and international accounting standards
□Applicable √Not applicable
There is no difference between the net profits and net assets disclosed in accordance with Chinese accountingstandards and those disclosed in accordance with international accounting standards in the reporting period.
2. Differences between net profit and net assets disclosed in the financial reports in accordance withChinese accounting standards and overseas accounting standards
□Applicable √Not applicable
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
There is no difference between the net profits and net assets disclosed in accordance with Chinese accountingstandards and those disclosed in accordance with overseas accounting standards in the reporting period.
VI. Non-Recurring Profit or Loss
√Applicable □Not applicable
Unit: RMB
| Item | Amount | Note |
| Gains on disposals of non-current assets (including offsetting amount for the provision of impairment of assets) | 7,613,935.62 | |
| Government grants recognized in profit or loss for the current period (excluding government grants that are closely related to the Company’s business operations, in accordance with national uniform standards) | 426,807,766.64 | The amounts of such government grants during the first half year of 2019 and 2018 are of 175,408,699.42 and 104,740,498.52 respectively. The change in amount was mainly attributed to the increase in fiscal appropriation, transportation capacity subsidies, tax refund, job stabilization subsidies, etc. |
| Gains or losses from changes in fair value of financial assets and liabilities held for trading, derivative financial assets and liabilities, and investment (losses)/gains arising from the disposal of financial assets and liabilities held for trading, derivative financial assets and liabilities and other debt investments, excluding hedging activities related to the normal business operations of the Company | -1,429,156.76 | |
| Net amount of other non-operating income and expenses | -23,668,908.06 | |
| Less: Income tax effect | 90,886,652.95 | |
| Profit or loss attributable to minority shareholders (after tax) | 1,605,088.81 | |
| Non-recurring profit or loss attributable to shareholders of the parent company | 316,831,895.68 | -- |
Provide explanations for classifying non-recurring profit and loss items defined in the Explanatory AnnouncementNo. 1 for Public Company Information Disclosures – Non-recurring Profits and Losses, and for classifyingnon-recurring profit and loss items listed in the Explanatory Announcement No. 1 for Public CompanyInformation Disclosures – Non-recurring Profits and Losses as recurring profit and loss items.
□Applicable √Not applicable
The Company has not classified non-recurring profit and loss items defined or listed in the ExplanatoryAnnouncement No. 1 for Public Company Information Disclosures – Non-recurring Profits and Losses in thereporting period.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
Chapter 3 Business OverviewI. Primary business of the Company during the reporting periodIs the Company required to comply with disclosure requirement of a particular industry?YesExpress Delivery Service Industry
SF Holding is a leading integrated express logistics service provider in China. After years of development, it hasbasically established the capabilities of providing integrated comprehensive logistics solutions to customers. Notonly does it provide high quality logistics services from the delivery end, it has also extended its services tosegments of production, supply, sales and distribution in the front-end of the value-chains, and catered toconsumer demand by using data technologies such as big data analysis and cloud computing to provide customerswith comprehensive solutions including intelligent warehouse management, sales forecasting and self-service bigdata analytics. Major products and services of the Company include various types of express services such asexpress delivery, economy express delivery, intra-city delivery, warehousing service and international expressdelivery; express transportation services focused on LTL (less than truckload) service; and cold chaintransportation services for customers in the fresh produce, food products and pharmaceutical segments; as well asvalue-added services such as insurance, Cash on Delivery (COD), packaging services and food preservationservices, providing diversified and refined services to customers. In addition, SF Holding provides end-to-end,smart and integrated supply chain solutions and comprehensive supply chain services covering various industriesand application scenarios.
Based on the diverse needs of different industries, customers and scenarios, SF Holding adheres to the“customer-centric, demand-driven and experience-based” product design philosophy that focuses on eachindustry’s unique characteristics, and starts from the application scenarios of customers to drill into theirrequirements for different use cases within the end-to-end whole process and other individual requirements ofcustomers. Thus SF Holding is able to design suitable products, services and solutions for customers whilecreating value-added differentiation, and such product design in turn drives internal resource allocation andoptimizes the product system. SF Holding continues to enhance the competitiveness of its service quality byproviding customers with experience of fast product delivery and high service quality; continues to optimizeoperation model and enhance resource efficiency while reducing costs and increasing efficiency, providingcustomers with cost-effective services and achieving win-win for the Company and its customers. Meanwhile, SFHolding enables product innovation with technologies to create industry solutions and provide customers withintegrated comprehensive logistics services.
SF Holding is also a smart logistics operator with network scale advantages, boasting a operating model withstrong management and control over the whole network. SF Holding has a gigantic logistics network at home andabroad, including an “aviation network” consisting of all-cargo aircraft, commercial flight and drones; a “groundnetwork” consisting of operating service points, transit and distribution service points, land transportationnetworks, customer hotline networks, and last mile networks; and an “information network” consisting of varioustypes of big data, blockchain, machine learning and planning optimization, AI recognition forvoice/image/computer graphics/smart security checks and smart logistics map. The three networks are integratedinto one “aviation +ground + information” network. This SF network has domestic and overseas coverage and is acomprehensive logistics network system with the most powerful network control, the highest stability, and themost unique resources in the industry domestically.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
II. Major Changes in Key Assets
1. Major Changes in Key Assets
| Key Assets | Description on major Changes |
| Equity assets | No major changes. |
| Fixed assets | Increased due to the addition of buildings, aircraft and accessories. |
| Intangible assets | No major changes. |
| Construction in progress | Increased due to the addition of aircraft refit and investments in industrial parks. |
| Financial assets held for trading | Increased due to increase in structured deposits. |
| Accounts receivable | Increased due to increase in revenue. |
| Investments in other equity instruments | No major changes. |
| Goodwill | No major changes. |
2. Key Overseas Assets
□Applicable√Not applicable
III. Core Competitiveness Analysis(I) Building industry-unique core competitiveness on strong technological strengthSF Holding consistently attaches importance to and actively invests in the building of smart logistics, and iscommitted to becoming a technology-driven industry solution service company, leading the building of anintelligent, digital, visualized, and refined logistics industry through technological innovation. As at the end of thereporting period, SF Holding had a total of 2,634 patents and 1,450 copyrights awarded or under application.Among which, the number of invention patent applications made in the first half of 2020 accounted for 49% of theCompany’s total number of patent applications during the period. In terms of the number of patents held, SFHolding ranked first in the domestic express delivery industry. SF Holding was named one of the world’s 50Smartest Companies by MIT Technology Review in 2019.
1. Big data ecosystem
(1) Application of big data technology: SF Holding continues to consolidate its big data technology framework,reinforce its data management capabilities, solidify the data platform, continuously strengthen the construction ofdata platform systems in various segments such as resources, operations, customers, and experiences, and promotethe construction of AIoT transit fields through big data + Internet of Things technology, thus further supporting theCompany’s business expansion as well as digital and intelligence construction across multiple sectors.
(2) Application of blockchain technology: SF Holding continues to explore the application scenarios ofblockchain technology, deep-plowed the fields of medicines and vaccines, fresh agricultural and sideline foodproducts, cross-border commodities, supply chain finance, etc., and actively participated in the formulation ofnational and industry-related standards to help customers in their supply chain digitalization and digital andintelligence transformation.
2. Smart logistics map
SF’s smart logistics map platform, providing smart location decision services which are applied to the wholelogistics process and are more tailored to logistics scenarios, was the first industrial-level logistics map service
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
product in China. It manages 800 million pieces of data of couriers’ locations as well as ground track data coveringsome 21 million square kilometres on a daily basis. The average daily requests for cloud services reaches 430million times and that for SDK terminals is close to 900 million times.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
3. AI smart decision-making
(1) Machine learning and planning optimization: SF Holding has constructed systems such as businessforecasting, site selection programming, network and route planning algorithms that are highly compatible with thecharacteristics of the logistics industry, realizing multi-scenario, multi-process and multi-dimensional businessforecasting, and resolving the location issue of multiple types of actual business scenarios. With online multi-postscheduling management, route pricing, digital transfer operation and other solutions, online and intelligentinformation and resource management is being effectively promoted to boost the transformation of traditionalmanagement models.
(2) AI recognition: Through the analysis of information and data on videos and pictures relating to parcels,personnel, vehicles, environments and sites in logistics scenarios, SF Holding has innovated and developed matureapplications such as safe driving platform, intelligent security inspection system and AI Argus, continuouslypromoting the intelligent upgrading of personnel, vehicle and site management and scheduling and thus effectivelysafeguarding operation safety, preventing cargo damage, and improving site operational efficiency.
4. Automation and smart wearable devices
Focusing on logistics operation processes, SF Holding conducts targeted research and development on automationinnovation. The output includes singulator systems, AGV-based automatic processing of irregular parts, unmannedparcel supply systems, multi-form automatic sorting equipment, etc. Core capabilities in automation and roboticshave been built to realize unmanned operation in the entire process of unloading, supplying, sorting, and loadingparcels, helping the Company in upgrading its automation capabilities and providing new driving forces and pathsfor the development of the logistics industry.
For collection and delivery processes, SF Holding continues to upgrade and innovate smart wearable devices,launching smart hardware such as smart Bluetooth headset “Xiaofeng”, smart hand-held terminals, and quickmobile measurement so as to adapt to the business needs in a variety of scenarios, achieving more efficientcollection and delivery, greatly improving work efficiency, and promoting the digital transformation of theCompany.
5. Smart offices
SFIM is a one-stop mobile smart office platform with an open and compatible technical framework capable ofperfectly integrating into third-party applications as well as connecting to upstream and downstream enterprises inthe SF ecosystem, which has significantly improved the efficiency of office collaboration, the level of businessvalue transformation and the level of information-based application among enterprises. SFIM provides service to560,000 users, as high as 90% of whom are daily active users on average.
6. Digital warehousing and benchmark warehouses
Through self-built intelligent SFWMS, digital warehousing maps, commodity digitization, labor and capacitydigitization and other technological capabilities, SF Holding has taken the lead in realizing the implementation andapplication of warehousing digital twins in the industry while forming a set of replicable and scalable warehousingautomation solutions, which has established specialized + servicing warehousing service capacity barriers.
SF’s self-developed OMS and WMS systems, which have accumulated amounts of replicable and scalable WMSsolutions and experiences, boast significant presence in the industry and their intelligent storage algorithmsintegrating software and hardware have been output and applied to seven major sectors, namely agriculture, energy,government and enterprises, 3C, footwear and apparel, pharmaceuticals, and cosmetics, empowering customers andbusiness partners, and playing an exemplary role in the intelligent upgrading of the warehousing and logisticsindustry.
7. Logistics drones
SF Holding has established a system for the research and development, testing, production and operation of logisticsdrones, and has fully mastered the core technology of logistics drones. As at the end of the reporting period, SFHolding had 347 patents under application or awarded, close to 50% of which were invention patents. In June 2020,
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
the standard project “Delivery Standards and Principles for Logistics Drones” of SF Holding and the project“Standards on Joint Information Collection and Exchange of Postal Logistics Drones” participated by SF Holdingwere incorporated into the 2020 Transportation Standardization Plans (First Batch) by the Ministry of Transport.Since obtaining the first approval for pilot trial in August 2017, SF’s drones have gradually achieved normalizedoperations in multiple scenarios from the hilly areas of southern Jiangxi to the mountainous areas of the westernplateau, with over 70,000 flights operating safely. During the COVID-19 pandemic, under the guidance ofauthorities and governments at all levels, SF Holding provided small-amount, multi-batch, point-to-point medicaland civilian logistics solutions and transportation to a number of regions such as Wuhan and Shiyan cities, flying formore than 730 hours, with a flight mileage exceeding 22,000 kilometers and transportation of more than 20 tons ofmedical materials.
8. Smart packaging
(1) Establishment of a green packaging ecosystem: On the basis of reducing the amount of bulk packagingmaterials, SF Holding has carried out pilot degradable materials projects. It has developed and piloted the promotionof inkless printed cartons, document sealing products and plastic bags. It has also established a database of physicalproperties of bulk materials in express logistics and has self-developed “carbon emission systems” to measure anddrive the optimization and iteration of packaging solutions.
(2) SF recyclable operating platform: The platform realizes container IoT as well as full lifecycle management,intelligent allocation and precise placement for reusable containers at multiple terminals and transfers. As at the endof the reporting period, a total of nine types of reusable containers including “Feng Box” were launched online, withover 785,000 units put into use which were reused for over 21 million times, reducing carbon emissions by morethan 7,678 tons.
(3) “Smart” “Fresh” scenario-based packaging solutions: SF Holding has established altogether 18pre-treatment centers with an integrated model of “smart fresh technology + automated pre-treatment +scenario-based packaging”, involving 10 categories, effectively tackling the weaknesses of the fresh food industry.
9. Information security
In the first half of 2020, SF Holding started the annual evaluation of classified protection of cyber securityprotection initiated by the Ministry of Public Security, and took the lead in the industry to launch self-assessmentwith respect to the compliance of the General Data Protection Regulation (GDPR), the most stringent personal dataprotection law in the EU. It also launched two key data security projects and eight key cyber security projects,carrying out high-strength security reinforcement and advanced threat detection on user privacy data,comprehensively protecting the data security of user privacy and fulfilling the security commitments of SF Holding.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
(II) Shaping a good brand image with a long-standing top ranking in service quality
SF Holding has established itself as a well-recognized and reputable express delivery service provider through over20 years of development. It is synonymous with “efficiency”, “punctuality” and “safety”, widely noted for itsexcellent corporate image and brand value.
According to the 2019 Express Delivery Service Satisfaction Survey Results (《2019年快递服务满意度调查结果通报》) released by the State Post Bureau, S.F. Express has ranked No.1 in “Overall Satisfaction towards ExpressDelivery Service Enterprises” for 11 consecutive years. According to the 2019 Express Delivery ServicePunctuality and Timeliness Test Results (《2019年快递服务时限准时率测试结果》) released by the State PostBureau, SF Holding has topped the ranking for 7 consecutive years. SF Holding ranked No.9 in Fortune’s list ofMost Admired Chinese Companies for 2019.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
(III) SF Holding adopts an operating model with strong management control over the whole network andwith stability and flexibility
SF Holding adopts an operating model that maintains strong management and control over the whole network, withthe whole express delivery network and key resources under the strict control of its headquarters, covering all linksof the business chain, which is conducive to the precise alignment of its corporate strategies from top to toe, as wellas the effective achievement of its strategies and business goals; it also helps to maintain the stability andcontrollability of our operation, standardization and compliance of our internal control, and ensure standardizedoperations, high operational efficiency and high service quality, thereby enhancing customer’s loyalty and brandreputation. While maintaining strict control of the key links and core resources, we have adopted a diversifiedresource acquisition and operation model, aiming to enhance the flexibility of the whole network and the space forexpansion, and extend the coverage of our services; we rely on our standardized operation and control processes thathave been developed upon many years of experience, as well as the advanced logistics technology to ensure thecontrollability and stability of the entire logistics chain, so as to achieve full control of the overall network andfurther enhancement of resource efficiency, provide support for business expansion, and form a stable and flexiblenetwork chassis. Meanwhile, the Company’s new businesses have made full use of the existing network resources toachieve synergy among network, customers, technology and resources, so as to grow rapidly and complement theexisting businesses.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
(IV) Unique and scarce intelligent logistics network, the “Aviation + Ground + Information” three-in-onenetwork
SF Holding continues to develop and improve its unique and scarce logistics service network integrating threenetworks, “aviation network + ground network + information network”, consistently consolidating and expandingits leading advantages in the industry.
1. Aviation network
In 2009, SF Airlines became the first privately-owned air freight company in China. Today, it has developed into anair freight company with the largest air cargo fleet in China, forming a cargo route network covering the whole ofChina and expanding to Asia and Europe, serving more than 60 cities around the world.The Company’s aviationcapacity building as at the end of the reporting period is as follows:
Cargo aircraft: (1) Fleet building: It had 59 self-owned all-cargo aircraft (of which, Boeing 767: eight aircraft,Boeing 747: two aircraft, Boeing 757: 32 aircraft, Boeing 737: 17 aircraft) with an average age of 23.97 years, and14 chartered all-cargo aircraft, operating 82 flight routes in total. (2) Traffic rights and airport slots: It had a totalof 215 pairs of slots, covering 52 large and medium-sized cities nationwide and international cities including Liege,Hahn, Delhi, Singapore, Ho Chi Minh and Chennai. (3) Pilots: It had a total of 523 pilots, including 211 captainsand 287 co-pilots. (4) Global operation: In the first half of the year, it operated 1,454 international flights in total,representing a year-on-year increase of 1,073%. 18 international routes were newly launched, includingChangsha-Liege, Pudong-Narita, Shenzhen-Kuala Lumpur and Shenzhen-Osaka, to further improve theinternational route network, thus greatly enhancing its global operating capacity. (5) Aviation safety: Since its firstflight, SF Airlines operated approximately 377,200 hours safely and passed the safety assessment conducted by theCentral and Southern Regional Administration of the Civil Aviation Administration of China (CAAC) for 10consecutive years.
During the lockdown of Wuhan due to the COVID-19 pandemic in 2020, SF Airlines transported medical and livingsupplies to the domestic pandemic prevention and control frontline. A total of 290 flights were operated with 6,874tons of cargo transported. At the same time, it actively participated in domestic and international emergency
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
pandemic prevention materials transportation tasks, and newly launched Beijing-Incheon, Wuhan-Narita,Pudong-Zagreb and other routes for the transportation of pandemic prevention materials.
Commercial flight resources: SF Holding has secured stable passenger aircraft bellyhold resources from morethan 100 commercial airlines at home and abroad through direct operations (cooperating directly with airlines),agents (freight forwarders), or tripartite cooperation (SF, airlines, and agents) to operate 1,922 flight routes acrossChina and the world.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
As at the end of the reporting period, SF Holding operated a total of 2,004 cargo aircraft and commercial flightroutes. In the first half of 2020, it had 582,700 flights in total averaging 3,202 flights per day. The volume of aircargoes handled amounted to approximately 782,100 tonnes, of which the volume handled by cargo aircraft was407,800 tonnes, representing a year-on-year increase of 60%.
Freight capacity of SF Holding’s air transport business：
| Resources | End of the current reporting period / Current reporting period | Daily average during the reporting period | |
| All-cargo aircrafts | Number of self-owned aircrafts | 59 aircrafts | - |
| Number of external chartered aircrafts | 14 aircrafts | - | |
| Number of all-cargo aircraft routes | 82 routes | - | |
| Total number of flights | 24,000 flights | 132 flights | |
| Total cargo volume | 407,800 tonnes | 2,240 tonnes | |
| Commercial flights | Number of commercial flight routes | 1,922 routes | - |
| Total number of flights | 558,700 flights | 3,070 flights | |
| Total cargo volume | 374,300 tonnes | 2,056 tonnes | |
Future air hub construction: The Hubei International Logistics Hub project lies at the core of SF Airlines’transportation system. In the future, SF will use this hub as the center of its air route network that covers the entirecountry and reaches the world, providing good fundamental support for increasing the coverage of time-definiteproducts, enhancing timeliness of products, building high-end integrated logistics service capabilities, and reducingaviation network operating costs. The Hubei International Logistics Hub has been incorporated into the package ofsupporting policies as planned in the national emergency infrastructure shortcomings remedying project, and EzhouAirport has been included in the scope of the air emergency and rescue system construction by the Hubei Province.The hub project, overcoming the impact of the COVID-19 pandemic, fully pushes the resumption of work, andstrives to basically complete the structural works of the airport project by 2020. After the airport is completed, it isestimated that cargo and mail throughput and passenger throughput will be 2.45 million tons and 1 millionrespectively in 2025, and 3.3 million tons and 1.5 million respectively in 2030.
2. Ground network
Service points: As at the end of the reporting period, SF Holding’s business covered 335 prefecture-level cities and2,835 county-level cities, with approximately 18,000 directly-operated service points. The international standardexpress and international economy express businesses covered 71 countries overseas, representing an increase of 9countries over the end of last year. The international small parcel business covered 225 countries and regions aroundthe world. It had about 350,000 couriers under various workforce models.
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Transit hub distribution: As at the end of the reporting period, SF Holding had 9 hub-level transit depots, servicepoints at 36 aviation and railway stations (excluding stations sharing sites with transit depots), and 130 sub-districttransit depots (excluding SF freight and SX Freight), of which 85 transit depots have adopted the automatic sortingsystem, representing an increase of 25 transit depots comparing to the end of last year.
Ground transportation network: As at the end of the reporting period, SF Holding had about 45,000directly-operated and outsourced vehicles for more than 110,000 long-haul and branch routes. The total number ofvehicles for terminal collection and delivery was about 100,000 (excluding motorcycles andtwo-wheeled/three-wheeled electric vehicles). Rail Speedy Express (极速达) services had been made available in74 cities covering a total of 420 flow-directions. Aside from high-speed railway lines, it had 6 express lines and 108standard railway lines, further stabilizing the 800-1,500 km long-distance railway transportation capacity. In thefirst half of the year, the Company continued to carry out the high-speed rail express delivery business to facilitatelocal specialty campaigns, transporting cherries, spring tea, crayfish, lychees, bayberry and other seasonal freshproducts utilizing high-speed railway lines. In addition to express delivery and freight services, the Companyformed normalized delivery capacity for bulk materials such as food, fertilizers, and aluminum products. Itcooperated with the platform companies of China-Europe Railway Express in Xi'an, Yiwu, Xinjiang and otherregions to conduct the international business of China-Europe Railway Express.
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Warehouse network: As at the end of the reporting period, SF Holding owned 194 warehouses of various types(including the New HAVI cold-chain logistics centers), with a total area of approximately 2.34 million squaremeters. A nationwide warehousing service network has taken shape and that industry-benchmarking warehousingservice capabilities have been established. In the first half of the year, the Company continued to build on corewarehousing capacity, and built a development pattern for the customized warehousing and distribution supplychain, e-commerce warehousing and distribution and the pharmaceutical cold chain transportation supply chainrevolving around customer needs in market segments, providing warehousing solutions covering more categoriesand application scenarios and thus successfully developing leading brandin new fields such as auto parts and homedecoration. Both operating scale and unit production capacity continued to improve, and a year-on-year increase of62% in e-commerce warehousing business volume was recorded during the peak season. Continuous breakthroughsin the research and development of warehousing technology have been made, and the launch and promotion of newsystems has effectively boosted business development.
Customer service network: SF Holding is committed to developing cutting-edge customer service systems, andresponding promptly to customers' needs; and to building a smart and digitalized service management platform thatprovides customers with professional, efficient and user-friendly services. SF Holding has four separate call centers,and some 900,000 customer enquiries are served on a daily basis. Customers have 24/7 access to internet-basedself-service via WeChat miniapps, WeChat public account, the Company’s official website, the SF Credit AccountManagement Platform and mobile apps. In addition, the speed of customer service response and customerexperience have been greatly improved through various service platforms and intelligent tools.
Last mile service: SF Holding has expanded its service networks to improve the coverage of towns and villagesby increasing the number and density of service outlets. As at the end of the reporting period, it had some 34,000terminal service points in cooperation with convenience stores, township agents and property companies. Thecoverage of towns and villages reached 83.63%, representing an increase of 1.78 percentage points from the endof last year.
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Hive Box Technology, in which SF Holding has invested as a shareholder, offers 24/7 smart express deliverylocker services via its delivery locker network throughout the country. In response to the COVID-19 pandemic,Hive Box lockers have fully demonstrated the advantages of “contactless delivery” in tackling the safety issues inexpress delivery, and the proportion of parcels deliveried though lockers has been further improved. Contactlessdelivery has cultivated the habit of picking up items from the locker among consumers, which is expected toquicken the development of the smart express delivery locker industry. In May 2020, Hive Box completed thereorganization with China Post Zhidi, with a further increase in market share, which has facilitated SF toaccelerate the implementation of its last-mile contactless delivery strategy and improve the efficiency of itslast-mile express delivery service. As at the end of the reporting period, Hive Box and China Post Zhidi set upmore than 270,000 locker service outlets covering 3.2 million couriers and 350 million consumers nationwide.
Focusing on smart express delivery locker users as the starting point, Hive Box Technology has developed 24/7unmanned Internet of Things solutions to create ecosystem platforms for e-commerce, advertising, delivery andindustry service businesses, connecting different groups to achieve win-win development.
3. Information network
SF Holding has independently researched and developed a complete set of smart network platforms covering allbusiness segments and scenarios to enable business in a fast, flexible, safe and comprehensive manner, and hasfurther promoted information interconnection of the whole logistics chain, which has created a smart and solidfoundation for the diversified business development of the Company. Meanwhile, the Company has also beencommitted to the development and implementation of cutting-edge technologies, adhered to independentinnovation, facilitated the upgrading of intelligent logistics, applied cutting-edge technologies such as operationoptimization, machine learning, deep learning, data analysis and mining to more practical business scenarios, andsupported new technology applications with cloud computing. The Company has adhered to user-oriented productdesign to enhance business performance and user experience, and enabled technology and products to beconscientiously implemented and better serve customers. Moreover, it has also integrated internal resources, andhas established intelligent management and intelligent decision-making platforms such as logistics operationanalysis platform and business forecasting platform by relying on massive internal and external data. Using dataand technology in making decisions and running the business, the Company has created SF’s “intelligent brain” torealize data-driven technology and technology-enabled logistics as well as to achieve the integration of the threenetworks of “aviation network + ground network + information network” into one network, supporting unlimitedbusiness possibilities.
(V) An integrated logistics service provider with one-stop supply chain service capabilitiesAdhering to the development of a diversified layout in recent years, SF Holding has completed its transformationfrom a pure express delivery service provider to an integrated logistics service provider and has established itsone-stop supply chain service capabilities. New business revenue has accounted for 26.69% of the Company’s
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total revenues, indicating that new businesses have become one of the key drivers for business growth in theCompany.
With the continuously rapid growth in its new business lines such as freight, cold chain and pharmaceuticaltransportation, and intra-city instant delivery, SF Holding has established an industry-leading network coverage interms of depth and width, operational capabilities, innovation technology, service quality and brand image,ranking among the top by market share in the respective industries. SF continued to build core capabilities inoverseas networks, customs clearance, sea, land and air multimodal transportation and other areas to furtherenhance its cross-border and overseas service capabilities. Relying on a mature and stable logistics networksystem and a rich product portfolio as well as the advanced supply chain experience and management capabilitiesof New HAVI and SF DHL, SF’s supply Chain provides customers in the industry with digital supply chainservices covering procurement, production, circulation, retail, and after-sales maintenance. SF’s technicalsolutions are driven by technology and data leveraging its technological capabilities in artificial intelligence andsystem R&D, and with the application of big data processing technology and the combination of products andprocesses into the model, a digital, modular and one-stop intelligent supply chain management platform is created.Its consumption trend analysis, customer profile construction, intelligent business system, big data processing,lead time forecasting and other solutions assist customers in optimizing, transforming and upgrading their supplychains and creating competition barriers, and help them cut costs, boost revenues, manage risks and develop newmarkets.
The Company continues to enhance resource sharing and business synergy among business segments to improveservice efficiency and flexibility. Supply chain services are intensively integrated with technical solutions, andguided by a deep understanding of the customer’s supply chains, solutions in line with customer scenarios areformulated to help customers improve the quality and efficiency of their supply chains. In addition, capitalizing oncomplementary resources and capabilities, collaboration between the Company and companies in the ecosystem,as well as among the companies themselves, are guided to build win-win ecosystem cooperation.
Over years of experience and M&A integration, SF has built solution and supply chain service capabilities in theautomotive and industrial manufacturing, FMCG and retail, life science and pharmaceutical, high-tech and 3C,beverage, finance, government-enterprise industries etc., and has provided customers with full-dimensional,multi-level, end-to-end integrated supply chain solutions and one-stop supply chain services coping with theirdomestic and global strategic needs. In addition, SF has joined hands with leading customers in the industry todevelop technical solutions by leveraging their respective advantages and sharing resources for an in-depthexploration and development revolving around customers and their upstream and downstream supply chains toachieve ecological cooperation.(VI) Prominent first-mover advantages on scarce logistics site resourcesAs at the end of the Reporting Period, SF Holding has successfully laid out an industrial park project across 46cities. The logistics sites covered a land area of approximately 1,256 acres, and a total planned construction areaof approximately 4.73 million square metres, approximately 1.64 million square metres of construction area werecompleted.
In order to revitalize existing assets of the Company, satisfy the rolling development needs of projects, andaccelerate the layout of industrial parks, the Company has been actively exploring the innovation of securitizationof logistics industrial parks. In 2018, the Company was approved to issue RMB5 billion ABS by way of shelfoffering which was the first perpetual domestic REITs in respect of logistics property issued by way of shelfoffering. In the two years of 2018 and 2019, the Company completed 2 rounds of issuance successfully, with totalproceeds of RMB3.2 billion raised, and recorded investment gains of approximately RMB1.4 billion on assetappreciation. In the second half of 2020, the Company plans to issue the third tranche of ABS and raise totalproceeds of not more than RMB1.5 billion. The Company’s wholly owned subsidiaries oversee routine operationsof the parks, which are the underlying assets of the ABS deal, as the park operator.
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Note 1: Inclusive of ABS industrial parks managed by the Company.
(VII) Warm, principled and productive SF cultureIn SF’s history of development, corporate culture is not just a belief, but more as a commitment and practice. It isreflected in every word and action of all SF employees, is expressed in every operating process, and has become astrong spiritual force that is embedded in SF’s cohesiveness, competitiveness, and vitality. 1. SF’s success isgrounded in assisting customer to succeed: SF has always been customer-oriented and is committed toproviding customers with above expectation services, assisting customers to create value and achieve success.While facilitating the success of customers, SF also achieves its own success. 2. Innovation drives SF forward:
SF Holding advocates the culture of innovation, emphasizing that everyone and every move can be innovative. SFhas not only made continuous breakthroughs in logistics technology fields such as logistic drones, smart devicesand smart packaging, but has also achieved extraordinary results in building Internet of Things, big data, artificialintelligence and other cutting-edge technologies. 3. Equality and respect uniting every heart: SF treats everystaff equally and with respect, and advocates the principles of “fairness, justice and openness” in staff employment,respecting the value of their contributions, providing everyone with equal development opportunities and assistingstaff to actualize personal value. 4. Be responsible proactively and fulfill the mission: SF does not only requireemployees to fulfill their responsibilities and perform their duties during their work, but also encourage employeesto take social responsibility. Upholding just and rightful acts, working for the public good, and other positiveevents occur more and more frequently among SF couriers. During the COVID-19 outbreak, SF couriers willinglyremained at their posts and the whole company stood firm mobilizing its HR, transportation and financialresources to the fullest extent. We provided strong assurance for the delivery of medicines, precision instrumentsand other anti-pandemic materials as well as living supplies and built “green channels” for the transportation of
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pandemic control supplies. Furthermore, Wang Yong, the “most impressive courier”, and many other SF staff,made their own contribution in the fight against the pandemic, conveying warm and touching sensations. Servingcustomers and giving back to the society with the simplest actions and the most sincere beliefs are the socialresponsibilities of SF staff.
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Chapter 4 Management Discussion and Analysis of Business OperationI. Overall Performance of the Company during the First Half of 2020
1. Overall financial performance
In early 2020, the outbreak of the COVID-19 pandemic had a huge impact on virtually all industries. SF Holding’sforward-looking and leading strategic deployment which had gradually build up barriers to competition after yearsof construction and operation demonstrated strong comprehensive operating capacity and risk-resilience in theface of the pandemic, with its core advantages becoming more recognizable. SF Holding's strong and powerfulcontrol of the network ensured effective pandemic prevention, rapid resumption of production and stableoperation of its entire network during the pandemic. Scarce resources such as our own all-cargo aircraft, highspeed railway routes, drones, and Hive Box Smart Lockers played a key role when ground transportation wasblocked and contact delivery was at risk. SF’s diversified product portfolio has enabled its comprehensivelogistics service capabilities, with the business segments such as express delivery, freight, cold chain,pharmaceutical transportation, intra-city instant delivery, and supply chain all exerting their respective advantageswhile operating in full synergy, comprehensively serving the needs for transportation and express delivery of theanti-pandemic materials and living supplies to residents. Affected by the pandemic, the business volume of thewhole express delivery industry recorded a year-on-year increase of merely 3.2% in the first quarter of 2020,while SF Holdings achieved a stunning growth of 77.1% against the trend, with a market share of 13.7%,representing an increase of 6.1 percentage points over the previous year.
Heading into the second quarter of 2020, when the whole country entered a stage of normalized pandemicprevention and control, the central government launched a series of economic stimulus policies and preferentialtax policies to promote the orderly resumption of work in various industries, leading to steady recovery of China’seconomy. SF Holding maintained its rapid growth achieved in the first quarter. On the one hand, the pandemicaccelerated the remodeling of the sales channels of high-end brands, during which second tier e-commerce andlive e-commerce platforms emerged along with consumption stratification, and high-end consumption trends toturn online, bringing enormous growth opportunities for the express delivery industry. On the other hand, theCompany continued its aggressive product and marketing strategy adopted in 2019 while constantly catering forthe needs in the market, with all its business segments maintaining their strong growth momentum. During thefirst half of 2020, the Company recorded 3.655 billion shipments for its express & logistics service, representing ayear-on-year increase of 81.27%, much higher than the industry average growth rate of 22.1%.The key financial indicators are shown in the table below：
| Item | Indicators | Current reporting period | The same period of previous year (Restated) | Increase/Decrease over the same period of previous year |
| Business | Revenue from express logistic and supply chain (billions RMB) | 70.188 | 49.480 | 41.85% |
| Of which: (1) Revenue from express logistic (billions RMB) | 67.231 | 47.637 | 41.13% | |
| Shipments (Billions) | 3.655 | 2.017 | 81.27% | |
| Average revenue per shipment (RMB) | 18.39 | 23.62 | -22.14% | |
| (2) Revenue from supply chain (billions RMB) | 2.957 | 1.843 | 60.46% | |
| Income Statement | Revenue (billions RMB) | 71.129 | 50.075 | 42.05% |
| Net profit attributable to shareholders of the parent company (billions RMB) | 3.762 | 3.100 | 21.35% | |
| Net profit attributable to shareholders of the parent company after deducting non-recurring profits and losses (billions RMB) | 3.445 | 2.330 | 47.82% | |
| Weighted average return on net assets | 8.51% | 8.20% | An increase of 0.31 percentage points | |
| Earnings per share(RMB/Share) | 0.85 | 0.70 | 21.43% |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Item | Indicators | End of the current reporting period | End of previous year (Restated) | Increase/Decrease over previous year end |
| Balance Sheet | Total assets (billion RMB) | 102.046 | 92.535 | 10.28% |
| Total equity attributable to shareholders of the parent company (billion RMB) | 46.854 | 42.420 | 10.45% | |
| Debt to Asset Ratio | 53.81% | 54.08% | A decrease of 0.27 percentage points |
Revenue: In the first half of 2020, the Company achieved a total revenue of RMB71.129 billion, representing ayear-on-year increase of 42.05%, much higher than the industry growth rate of 12.6%. Our traditional businessrecorded increases in both business volume and revenue, with our time-definite express business maintaining thegrowth rebound achieved at the end of the previous year, with a revenue growth of 19.42% year-on-year; oureconomy express business recorded a revenue growth of 76.12% year-on-year, contributing more than 40% of theoverall revenue increment. In addition, our new business segments maintained their rapid growth, with theirpercentage in our total revenue growing to 26.69%, up by 3.03 percentage points year-on-year. The developmentof our business segments appeared more balanced and healthy, and our comprehensive logistics capabilitiescontinued to improve.
Note：Data sources from state Post Bureau and announcements of The Company.Profit: In the first half of 2020, the Company achieved net profit attributable to shareholders of the parentcompany of RMB3.762 billion, representing an increase of 21.35% year-on-year, net profit attributable toshareholders of the parent company after deducting non-recurring profits and losses of RMB3.445 billion,representing an increase of 47.82% year-on-year, net margin attributable to shareholders of the parent company of
4.84%, representing an increase of 0.19 percentage points over the same period last year.
In order to protect the smooth transportation of epidemic control materials, the company resumed work quickly,and increased staff incentive allowances and expenditures on epidemic prevention and disinfection work. Thestate’s initiatives to deal with the impact of the epidemic, including exemption of VAT
Note1
, reduction ofemployer’s social insurance contributions, exemption of tolls, reduction of property rent, and exemption ofcharges for civil aviation development fund and other preferential tax relief policies, effectively alleviated the costburden caused by the epidemic to the Company. Among these policies, the exemption of VAT
Note1and theexemption of civil aviation development fund will continue until the end of 2020.
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In addition, the Company continued the optimization of its operating model (including measures such as theseparation of handling processes from time-sensitive parcels and less time-sensitive parcels), and proceeded withimprovement initiatives gradually around collection and distribution, transit, transportation and other aspects,which significantly improved the efficiency of the entire process of operation, effectively reduced costs andcreated economies of scale amidst rapid volume growth. At the same time, benefiting from the Company’scontinued investment in digital, intelligent and visualization technology to help streamline the organization andraise management efficiency, the costs continued to decline, and the Company’s profitability improved further inthe second quarter.Financial Status: As at the end of the reporting period, the Company’s total assets were RMB102.046 billion, anincrease of 10.28% as compared with the end of 2019. The Company's total equity attributable to shareholders ofthe parent company was RMB46.854 billion, an increase of 10.45% as compared with the end of 2019. As at theend of the reporting period, the Company’s debt-to-asset ratio decreased slightly, from 54.08% as at December 31,2019 to 53.81% as at June 30, 2020, the level of debt remained healthy and the financial position was stable andoptimistic. In early August 2020, the conversion of the Company’s publicly-issued convertible bonds wascompleted and, assuming all other conditions remain unchanged, the gearing ratio could be reduced toapproximately 50% and stay at a healthy leverage level, as calculated based on the Company’s assets and debts asof June 30, 2020.Note 1: According to Articles 3 and 5 of the Announcement of the State Administration of Taxation of the Ministry of Finance on the Taxation Policy on Supporting the Prevention andControl of the Outbreak of COVID-19 (Announcement of the State Administration of Taxation of the Ministry of Finance No. 8 of 2020), taxpayers are exempted from VAT on theincome derived from the transportation of key supplies for the prevention and control of the pandemic and that derived from the courier service for the delivery of essential livingsupplies to residents.
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2. The traditional business ushered in new growth drivers, contributing sustainable and healthy revenueand profit
（1）We adopted proactive marketing strategies and focus on both organic growth and expansion, strivingto constantly improve customer experience and loyalty.In the first half of 2020, the Company continued to focus on industry characteristics and business clustering, andtapped into customer demand centering around the direction of multiple-scenario planning, digitalization andrefinement. At the same time, we continuously upgraded our digital intelligent tools and product portfolio andrelied on technologies to conduct resources allocation and marketing accurately, continuously improve ourcustomer service capabilities and customer experience, enhance customer loyalty, and ensure quality, stable andhealthy growth of customers and revenue.
Credit account customers: We focused on the full life cycle of customer management, relying on our ownlogistics data platform to achieve full visualization and traceability of data in customer management; we graduallybuilt up a customer hierarchy-oriented management model, flattened customer demand channels, andcomprehensively improved service experience and loyalty of small and medium-sized customers. In addition, wecontinued to focus on the ecological chain of industries, make the most of our customers and their upstream anddownstream businesses in their industry chain, conducted cross-selling of our product mixes, and continued toimprove our overall industry solution capabilities based on our multiple product portfolios. We have established apre-sales support system for complex business scenarios of our key customers to facilitate multi-dimensionaldifferentiation in personnel, processes, tools, systems and implementation, and established a dedicated qualitymanagement and monitoring system for key customers to achieve integrated output of resources, aiming to solvecomplex, differentiated and comprehensive needs of our customers, and achieve continuous improvement of ourkey customer service capability.
As at the end of the reporting period, our active credit account customers amounted to 1.47 million, and in the firsthalf of 2020, the revenue from our credit account customers increased by more than 50% year-on-year,representing a rapid growth in customers with monthly sales above RMB10,000, a gradual expansion of theproportion of customers with monthly sales above RMB1 million, and a further increase in the proportion ofcustomers from the e-commerce sector, indicating continued optimization of our customer structure.
Retail customers: We focused on the expansion of C2C business contacts and deepened our channel operation toimprove customer service experience and create a competitive online and offline channel service experience. Inrespect of offline channels, we continued to strengthen our cooperation with social resources to further broadenand deepen the network coverage at the city, township and village levels. We relied on digital intelligent tools toachieve precise investment of resources in the business frontlines, from network layout, personnel, customerdiscovery to marketing. Meanwhile, we increased our efforts in development of core business scenarios, designedcorresponding solutions and intelligent business decision-making tools for different scenarios. In respect of onlinechannels, we focused on exploitation of resources and dataflow conversion through our S.F. Express APP andleading WeChat channels, while expanding cooperation with other leading platforms to expand online usercontacts. In addition, based on the ever-changing characteristics of our users, we have developed differentiatedmarketing strategies for low, medium and high frequency users while continuously optimizing our paid productssuch as SVIP and paid coupon packages, resulting in significant improvement in our online operation capabilities.
As at the end of the reporting period, the number of individual members reached 280 million, with nearly 100million online monthly active users. In the first half of 2020, revenue from individual customers increased by 23.7%year-on-year, with the number of senders exceeding 155 million, up by 9.0% year-on-year, among which, onlineorders increased by 55% compared with the first half of last year.
（2） We continuously consolidated the operating infrastructure, optimized our operating model, enhancedour core advantages and reduced costs and increased efficiency.In the first half of 2020, the Company made precise resource investment based on different product servicestandards and market competition landscape; we continuously optimized our network and routing planning andoptimized the operation mode of each segment, achieving optimal efficiency for each product; through end-to-endfull link efficiency and quality control and precisely location of abnormal operational links, we achievedimprovement in operational efficiency, timely effectiveness and quality. In respect of terminal network: in the first
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half of the year, we achieved the optimization of network operating costs through restructuring of the regionalinfrastructure and strengthening the integration of terminal network and transit depots functions; meanwhile, werelied on the application of digital tools to improve the efficiency of collection and delivery. In respect of transitand distribution: we optimized the planning of transit depot, constructed integrated multi-business depots whilereducing small, scattered and temporary depots and deepening the integration of resources among business sectorsto achieve resource synergy and economy of scale. Meanwhile, we increased the investment in automated transitequipment, resulting in significant improvement in automation coverage, and a 30% increase in the efficiency ofthe automated depots as compared with December 2019; through continued promotion of such modes ascontainerized transport and direct distribution and shipping, the pressure on distribution and warehousemanagement has been significantly relieved. In respect of transportation, we continued to improve the loading rateof our all-cargo aircraft through direct collection and distribution, optimization of routes with low loading rates,and filling warehouses before shipment; we constantly improved the loading rate of trunk routes and transportefficiency through reducing temporary extra routes, integration of long distance routes, integration of unilateralresources, optimization of routes with low efficiency, and promotion of large vehicle models and Drop and Pulltransport modes.
In the first half of 2020, the Company gradually built up a collaboration and separation network model fortime-sensitive parcels and less time-sensitive parcels in different scenarios, further improving the resourceutilization efficiency and maximizing economy of scale. The Company invested dedicated resources in key areaswith large collection volunm and core competitive areas to enhance the scale effect and competitiveness, whileenhancing synergy in business incubation areas and those with surplus capacity. In respect of collection anddistribution: we arranged direct shipment from the collection outlets through bulk loading at customers/outletswith larger less time-sensitive parcel volume, pre-allocation of time-sensitive parcels and less time-sensitiveparcels, and instant shipment once capacity is filled. In respect of transit, we separated less time-sensitive parcelsat the transit section by constructing dedicated depots, designing diversion solutions for bottlenecked depots, andpromoting bulk loading and transportation. As for transport: we improved the loading rate and transport efficiencyof the trunk routes through such measures as filling the time-sensitive parcels trunk routes with less time-sensitiveparcels while there was spare capacity, dedicated trunk routes for less time-sensitive parcels, and upgrading tolarge vehicles.
Thanks to the above-mentioned optimization measures, in the first half of 2020, our distribution and collectionefficiency increased by more than 30% while the warehouse management efficiency increased by more than 40%year-on-year, with the loading rate of all-cargo aircrafts, trunk and branch routes and their efficiency improved tovarying degrees. Our timeliness and customer satisfaction also reported year-on-year improvement.
（3）Time-definite business witnessed a rebound in growth rate, with improved quality and efficiency,ushering in new growth spaceTime-definite business is a mid-to high-end market segment in the express delivery industry, and SF enjoys anabsolute advantage in the market by virtue of its superior service standards known as "efficiency, precision andreliability”. In the first half of 2020, the Company continued to strengthen its service capabilities and competitionbarriers of its time-definite products through such measures as air-ground network connection, improving theoperation capability at collaction and distribution ends, optimizing the aviation network layout and capacitystructure, expanding direct trunk routes transportation, and optimizing the coordination and separation of fast andslow products. Meanwhile, we managed to meet the specific needs of customers and facilitate operating modeloptimization through refinement and improvement of our product and service standards and application ofscientific pricing models to achieve reasonable differentiated pricing of products. The per-order average life cycleof our time-definite parcels was reduced by 0.1 hours in June compared to the same period last year.
In the first half of 2020, the Company’s time-definite business continued the trend of stabilization and recoveryachieved at the end of last year, with a revenue of RMB31.962 billion, representing a year-on-year increase of
19.42%. SF remained open during the Spring Festival and resumed work rapidly during the pandemic period, withits time-definite business undergoing a rapid growth due to the demand for pandemic prevention materials andonline shopping while the whole express delivery industry was facing difficulty in resuming work. With theorderly resumption of work and production in various industries, the number of business parcels began to pick upwhile masks and other conventional pandemic prevention materials remained in high demand, contributing to theincrementation of time-definite parcels. In addition, consumption stratification continued to generate growth spacefor our time-definite business, while the pandemic had accelerated the penetration of e-commerce, with online
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high-end consumption beginning to take the trend, resulting in a significant increase in our high-end e-commercecustomers using our time-definite services, which has become an important driver of the growth of ourtime-definite business.
（4）Economy business continued to grow, leading to increased market share and amplified economy ofscaleIn May 2019, we launched special economy services for the e-commerce market and customers, which turned outto be a key initiative to adjust our economy product business strategy, resulting in rapid development of ourspecial economy services, which in turn led to a sharp increase in the revenue and market share of our economyproducts. In the first half of 2020, SF Holdings gave full play to its network advantages, relying on its brand andservice barriers to continuously tap into the e-commerce market, aiming to enhance its market share, andgradually form a new competitive strength. Our economy product business recorded a revenue of RMB20.183billion, up 76.12% year-on-year, while our business volume increased by 240.86% year-on-year, resulting in asignificant increase in the Company’s market share.
In the first half of 2020, the Company continued to optimize and upgrade its economy product business, andprecisely cater for the demands of its target e-commerce customers, while further improving its resourceutilization efficiency and cost reduction on the basis of balancing cost performance and service quality. On the onehand, in line with our differentiated customer introduction strategy, we concentrated on high-quality small andmedium-sized e-commerce customers, while targeting and securing large e-commerce or industry customers, andconstantly expanding the ground network business volume; on the other hand, in line with our flexible salesstrategies and resources allocation incentive, we focused on introducing light and small parcels within 1kg perorder to optimize the e-commerce cargo volume structure and provide cargo volume base for the transformation ofoperating model and refined cost management. Meanwhile, we constantly promoted the optimization of thebusiness models such as bulk collection and packaging at the collection end, transit by package, directtransportation for trunk routes, so as to improve the efficiency of each link of operations based on the changes inthe size and structure of cargo volume. In the sections and regions where the cargo volume has reached therequired scale, we promoted the separation of fast and slow-moving parcels in an orderly manner, taking intoaccount both timeliness and quality, aiming to maximize the economy of scale.
3. New businesses maintained its rapid growth, contributing to the formation of our comprehensive logisticsservice capabilities
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
（1）Freight
The less-than-truck-load industry in which SF Freight operates is a trillion-dollar market, which is in the earlystage of scale and industry consolidation, showing strong growth momentum. Heading into 2020, theless-than-truck-load industry remained hot and favorable in the capital market, leading the competition pattern ofthe express delivery market into an era of competition among giants. The Company’s freight business is operatedunder the dual brands of SF Freight and SX Freight. SF Freight targets the mid-to-high-end market demandinghigh timeliness, high quality and superior service experience, while SX Freight focuses on the whole-networkmid-end market. The two brands complement each other in terms of product positioning, and are integrated togenerate synergy in terms of operating model and resources.
Targeting the mid-to-high-end less-than-truck-load market, SF Freight has 57 transit depots, about 1,400 transitservice outlets, a site area of more than 2.09 million square meters, and a daily carrying capacity of 110,000 tons,representing an increase of 29% over December 2019; it operates a fleet of more than 19,000 collection anddelivery vehicles, 1,439 trunk routes, and 9,100 branch routes, with its business network covering 362 major citiesand regions in 31 provinces. In the first half of 2020, SF Freight upgraded and enhanced its end extension services,aiming to establish competition barriers to C-end services. Meanwhile, it continued to step up its investment in thedepots and routes to consolidate its operation infrastructure, resulting in continuously improved timeliness;through investing in its independently developed second-generation sorting equipment, it has significantlyimproved its distribution efficiency; meanwhile, it emphasized the application of innovative technologies, aimingto build an intelligent logistics network through the digital depot management tools. In the first half of 2020, SFFreight’s revenue exceeding RMB7 billion，LTL cargo volume increased by 74% year-on-year, which is anabsolute leading growth rate in the mid-to-high-end market, with a daily peak LTL cargo volume of 28,000 tons,and its market share continued to expand.
SX Freight is an independent franchising brand name of SF Freight, targeting the middle-and low-end customergroups in the less-than-truck-load industry. It has more than 9,300 franchised outlets, representing an increase of55% compared to the end of last year, along with 117 self-operated depots with a total area of 470,000 squaremeters. Its initially established network now covers 2,207 districts and counties of 303 cities across the country.During the pandemic period, SX Freight adhered to its operation guidelines known as “maintaining stability,expanding scale and increasing growth speed” and was the first in the industry to announce nil-cost franchising,aiming to encourage business start-ups for all people, triggering the industrial reform in franchising admissionrules, resulting in a rapid network expansion, a gradual increase in its market share, as well as a rise of its rankingof revenue from sixth to fifth among the wholenetwork franchise platforms. In the first half of 2020, the LTLcargo volume of SX Freight increased by 57% year-on-year, ranking first among the mainstream players, with adaily peak cargo LTL volume of 16,000 tons.
In terms of integration of operation infrastructure, SF Freight and SX Freight have combined their networks andmiddle platforms, and applied innovative technologies in establishing links between capital flow, information flowand business flow, providing comprehensive support for sharing of networks, integrated operation of depots,mixed loading and unloading for all their routes, nearby hand over for franchisees, and mutual-complementationof delivery advantages, which have helped achieve resource coordination, mutual benefit and win-win withfranchisees, cost reduction and revenue increase.
During the first half of 2020, the revenue from the Company’s freight business as a whole amounted toRMB7.674 billion, representing a year-on-year increase of 51.30%, higher than that of its peers.
（2） Cold Chain and pharmaceuticals
According to experts from the Cold Chain Logistics Professional Committee of China Federation of Logistics andPurchasing, the total scale of China’s cold chain logistics market is expected to reach RMB373 billion in 2020,representing a year-on-year increase of 10%, indicating further growth in the demand in China’s cold chain market.However, China’s cold chain market is highly fragmented as current cold chain enterprises are mostly regional orlocal enterprises, with immature cold chain technologies, and varying implementation standards and quality. SFhas established a nation-wide cold chain network for food, which has given it an absolute advantage in networkcoverage, as well as industry-leading cold chain technology and implementation of standards. In the first half of2020, SF continued to increase its investment in the national cold chain network, resulting in further improvement
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
in the network coverage and timeliness of service. As at the end of the reporting period, SF had 24 high-standardrefrigerated food warehouses integrating multi-temperature section management and distribution capabilities, witha total operation area of 150,000 square meters; it also had 261 refrigerated trucks featuring advanced vehicle GPSand real-time temperature monitoring systems. In 2019, the British Standards Institution (BSI) granted the ISO22000 food safety management system international standards certificate to SF cold-chain, and in May 2020, thetwo industry standards in which SF had participated in drafting won the special fund reward in Shenzhen.
Leveraging its powerful transportation networks, leading warehousing services, automated branch warehousingsolutions, professional temperature control technology and advanced system management, SF Holding providesits customers with professional, secure, custom-made and highly efficient cold-chain logistics distribution servicesunder whole-process control. The cold chain business currently covers many sectors ranging from production,e-commerce and sales to retail operations. In the first half of 2020, the outbreak of the COVID-19 pandemicramped up contactless online consumption, resulting in continuous improvement in the Company’s B2Ccold-chain business. And SF Holding continuously cultivated B2B cold chain business，thus the whole cold chainbusiness maintained high growth. In addition, its operational efficiency and service quality were further improvedthrough continuous model optimization and resource synergy.
To address the pain points e.g. "timeliness, safety and after-sale service" faced by the agricultural products inChina, SF Holdings made good use of its advantages such as its well developed logistics network, timeliness,packaging and freshness preservation technology to help China’s special agricultural products go out of themountains and into the markets across the country. While maintaining its focus on the B2C industry chain, SFfurther expanded into the B2B service market to secure its position in the fresh produce market. Throughinnovation in its business models such as warehouse-splitting and one package pass-through in B2B2C, SFHolding has achieved cost efficiency, pricing that further close to market and has enhanced its marketcompetitiveness in various business scenarios. Adhering to the concept of "opening-up and win-win cooperation",in the first half of the year, SF joined hands with the government and product origin associations in holding a totalof 10 promotion activities under the themes of logistics or product-to-marketing connection, releasing 578 newsarticles, and covering 197 million people. SF maintained its absolute leading market share in its traditionalprojects such as Yantai cherry, Lingnan lychee, Xianju waxberry, and continued to develop such new projects asWuxi peach and Inner Mongolia beef and mutton, with an agreeable growth momentum.
With the deepening of China’s pharmaceutical reform, the pharmaceutical resources are extended to the primarymedical organizations, resulting in the flattening and deepening of pharmaceutical circulation channels, whichhave higher requirements for the breadth and depth of the networks as well as product quality and safety ofpharmaceutical logistics and distribution enterprises, while the pharmaceutical logistics market appears highlyfragmented and disordered, with many small players and varying operational quality. Relying on its own logisticsnetwork, technology infrastructure and advanced experience in intensified resource management, SF continued tocultivate a deeper and broader pharmaceutical service network so as to provide its customers with professional,safe and fully controllable one-stop pharmaceutical logistics supply chain solutions and services, covering anumber of fields such as the pharmaceutical industry, production, e-commerce, distribution, and retail. As at theend of the reporting period, SF’s pharmaceutical network covered 237 prefecture-level cities and 2,046 districtsand counties, with 6 pharmaceutical warehouses (4 GSP-certified warehouses and 2 customized warehouses) in atotal area of 30,000 square meters, 228 GSP-certified refrigerated trucks running on 46 pharmaceutical trunkroutes through the core cities across the country, under the control and monitoring of the advanced logisticsinformation system and self-developed TCEMS full-process visualization monitoring platform.
In the first half of 2020, the Company continued to cultivate its pharmaceutical customers, achieving a rapidgrowth in its pharmaceutical business, recording a doubled revenue year-on-year, and agreeable results in respectof service timeliness, service quality and cost control. SF’s pharmaceutical segment has also gradually shiftedfrom a simple drug transportation to diversified services, further unblocking the medical resource chain to deepenand upgrade its cooperation with the enterprises in the pharmaceutical industry chain such as drug manufacturers,distribution companies, vaccine manufacturers, disease control centers, hospitals and chain pharmacies at alllevels. The COVID-19 pandemic has vitalized the Internet medical market, with the demand for C-end homedelivery of drugs witnessing a stunning eruption, followed by the unprecedented development of the huge marketfor chronic disease services. During the pandemic period, SF joined hands with major leading Internet hospitalsand over 1,000 grade hospitals in China to provide patients with home delivery of ambient temperature andrefrigerated medicines as well as comprehensive pharmacy services. SF made one after another breakthroughs in
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
the cold chain transportation of biological samples, vaccine supply chain and intelligent pharmaceutical logistics,providing pharmaceutical cold chain services such as high-quality storage, transportation and full-process qualitytracing for vaccine manufacturers and the Centers for Disease Control and Prevention.
In the first half of 2020, the Company’s revenue from the cold chain and pharmaceutical business amounted toRMB3.241 billion, representing a year-on-year increase of 37.78%, maintaining its rapid growth.
（3） Intra-city instant delivery
With the upgrade of their demand and the popularity of local life, consumers now have higher requirements for"instant" shopping, which helped to optimize and upgrade the industry chain running "from instant consumptionto instant logistics", and accelerate the arrival of the era of home delivery of everything. Instant logistics, as theinfrastructure of the new retail supply chain, has developed into a market of hundreds of billion yuan, andmaintained a rapid growth trend, with bright prospects.
SF’s intra-city instant delivery service is committed to building a third-party real-time logistics platform featuring"high quality, high efficiency and full scenario" under the concept of “professional and user-friendly delivery”,providing brand merchants, small and medium-sized merchants and individual users with a variety of deliveryservices covering food & beverage, supermarkets, fresh food, clothing and medicine, with a year-on-year increaseof 100% in the number of customers.
SF’s intra-city instant delivery service continues to build an open instant delivery network, focusing on serving the"all-product, all-scenario, and all-time" customer demand, aiming to build a full-chain solution with acomprehensive coverage of the B-end, providing customized products, branded products, time-definite intra-cityproducts and economy intra-city products, as well as a product matrix covering deliver, pick-up, buying anderrands running on the C-end, which facilitates the reasonable distribution of the multi-category, multi-time andmulti-distance orders within the business circle, comprehensively enhances the distribution efficiency; meanwhile,it actively explores the integration with terminal delivery, urban supply chain and other logistics business models,aiming to establish a diversified and healthy product portfolio. Especially in the business scenario, we introducedthe countersigning service, which became the first choice of our business customers through more standardizedinvoice provision and settlement service, more assured after-sales guarantee and more professional end delivery.Meanwhile, we accelerated the expansion of our network coverage, focusing on the enormous pandemic-inducedneeds for home delivery of fresh goods, online order delivery, and errands running services. Following themitigation of the pandemic, SF’s intra-city instant delivery service was quickly resumed, leading to a significantlyimproved network coverage. In addition, SF’s intra-city instant delivery service continued to promote technologyupgrades, aiming to build a closed loop of the ultimately efficient logistics services. Relying on its self-developedintelligent scheduling systems as the core and customer experience and riders’ perception as orientation, SFcontinued to facilitate the refined and flexible multiple-capacity integration, help to reduce costs and increaseefficiency, and achieve continuous improvement in timeliness, customer satisfaction, and riders’ sense ofbelonging, so as to provide our customers with consistent and high quality delivery services.
During the first half of 2020, revenue from the Company’s intra-city delivery business amounted to RMB1.265billion, representing an increase of 61.06% over the same period last year, much higher than the average growthrate of the industry.
（4）International Express
SF International is committed to providing convenient and reliable logistics services, such as international expressdelivery, international freight forwarding, e-commerce parcels, international warehousing, goods consolidationand forwarding services, for domestic and foreign manufacturers, trading companies, cross-border e-commercecompanies and consumers. In addition, we can provide integrated and customized import/export supply chainsolutions, including market access, transportation, customs clearance, delivery, warehousing and system, based onour customers’ needs.
SF’s international express business covers 71 countries, with 8 South American countries added, includingArgentina, and 1 African country, i.e. Ethiopia, as compared with 2019, and its international small parcel business
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
covers 225 countries and regions around the world. In the first half of 2020, SF International vigorouslydeveloped its international cargo business. In response to the urgent demand for international air transport ofpandemic prevention materials and other goods in the external markets, SF International quickly opened 18international all-cargo air routes including those from China to the Americas, Europe, South Asia and SoutheastAsia. In the first half of 2020, the total transportation volume of our international all-cargo air routes exceeded40,000 tons.
SF International continued to deepen its cooperation with major cross-border e-commerce platforms, including theRussian e-commerce platform “J”. In addition to that, it entered into business cooperation successively with 7countries including Italy in the first half of 2020. In addition, SF became an officially recognized cross-borderdirect shipping logistics service provider by global e-commerce platform A and successfully bid for the directshipping project (first and second leg) of the platform’s logistics subsidiary, which is planned to be officiallylaunched in the second half of the year.
SF International provides its customers with full-scenario, integrated, self-controllable international supply chainsolutions to help Chinese enterprises complete their overseas layout and help overseas brands expand at home andabroad. In June 2020, SF International developed an end-to-end solution for the supply chain of an overseas healthproduct manufacturer in the bonded zone, providing it with customized global central warehouse services, i.e.logistics services such as introduction of overseas raw materials, production and packaging, bonded warehousing,customs clearance and distribution.
In addition, SF has gradually developed logistics infrastructure solutions capacity with its own characteristics, andthrough the formal cooperation projects with National Postal Services abroad, it has taken an important step toexport its experience and technology to the world.
During the first half of 2020, the revenue from the Company’s international express business amounted toRMB2.905 billion, representing a year-on-year increase of 141.71%, making it the fastest growing businesssegment of the Company.
（5）Supply Chain Business
In the first half of 2020, SF continued to apply its advanced technologies in the M&A supply chain business, i.e.New HAVI and SF DHL, and drive the digital transformation and upgrade and the growth of their new businessthrough the synergy of SF’s network resources. On the other hand, SF quickly applied the supply chain solutionsand management capabilities of New HAVI and SF DHL, and continued to enhance its ability to providetechnology solutions to its customers leveraging its digital technology advantages such as SF’s big data andartificial intelligence. Such efficient resource integration and collaboration has ensured the continuous rapidgrowth in its supply chain business.
The integration between New HAVI and SF continued to deepen. In respect of information infrastructure, SFfocused on both iterative upgrade and innovative development, with its new logistics and supply chainmanagement system put into use in most of its businesses. New HAVI has entered into a long-termintercommunication mechanism with each business segment of SF, for example, it has realized business diversionwith SF’s express delivery, cold chain transport and freight segments, and entered into cooperation with SFindustrial park in respect of warehouse resources. Through sharing and integration, New HAVI has established 38logistics centers in 23 core cities and more than 1,000 transportation routes with high efficiency turnover.
Faced with the COVID-19 pandemic, New HAVI successfully turned challenges into opportunities. With its soundand responsive crisis management mechanisms and emergency response plan, it was able to ensure the safety ofpersonnel, food and operation in the whole supply chain, and provide safe and stable refrigerated food service toits customers, winning high recognition from them; while maintaining its high level service and stable operation,New HAVI comprehensively implemented its cost reduction and efficiency improving measures, as well asaccelerating the development of its domestic and overseas business. From the beginning of second quarter, despitethe weak market performance, New HAVI quickly overcame the negative impact, with all the business indicatorsbeginning to recover and the number of customers continuing to grow.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
While the COVID-19 pandemic has posed challenges and uncertainty for many of its corporate customers, SFDHL continued to provide stable and reliable supply chain support for its customers by leveraging the resources ofSF’s network and its partners' networks. With the on-going resumption of work and production in China, SF DHLcontinued focus on customization while complementing with standardized solutions, and accelerated theconversion of its supply chain management experience into modular and digital products, so that they can berapidly rolled out and landed in existing and new projects to create economy of scale. In respect of key industries,SF DHL has explored and started to establish a professional supply chain network and products with industrialcharacteristics, which can be turned into flexible, efficient and rapid response supply chain solutions according todifferent business scenarios, thus enhance the flexibility and resilience of its customers' supply chains at a time ofuncertainty in the supply chain industry, while supporting the development of their supply chains.
Notwithstanding the impact of the COVID-19 pandemic on the supply chain industry, SF DHL’s new business andrevenue both recorded an industry-leading double-digit growth year-on-year in the first half of 2020 as itscooperation with customers deepened, with customer satisfaction continuing to improve.
During the first half of 2020, the revenue from the Company’s supply chain business as a whole amounted toRMB2.957 billion, representing a year-on-year increase of 60.46%. SF DHL has been incorporated in the parentcompany since March 2019, and from March to June 2020, the revenue from the Company’s supply chainbusiness reported an accumulative increase of 25.34% as compared with the same period of last year, stayingahead of its peers in the industry.II. Analysis on Main BusinessOverviewFor details, please refer to “I. Overall Business Performance of the Company during the First Half of 2020” underthe section “Chapter 4 Management Discussion and Analysis of Business Operation”.
Year-over-year changes to major financial data
Unit: RMB
| Current Reporting Period | The same period of previous year | Increase/Decrease over the same period of previous year | Rationale | |
| Revenue | 71,129,007,738.21 | 50,074,704,033.85 | 42.05% | Increased due to business growth. |
| Cost of revenue | 57,863,128,901.41 | 40,152,044,224.73 | 44.11% | Increased due to the increase in costs caused by business growth. |
| Selling and distribution expenses | 1,056,658,701.93 | 884,558,139.21 | 19.46% | |
| General and administration expenses | 5,861,443,162.73 | 4,844,842,279.57 | 20.98% | |
| Financial expenses | 472,967,469.92 | 331,613,346.38 | 42.63% | Increased due to the increase in interest expenses from increased borrowings. |
| Income tax expense | 1,714,998,647.00 | 882,642,296.52 | 94.30% | Increased due to the increase in total profits and deductible tax losses for which no deferred tax asset was recognised. |
| Research and development investment | 1,311,258,210.74 | 1,208,951,470.76 | 8.46% | Increased due to the increase in research and development activities. |
| Net cash flow from operating activities | 6,931,712,320.10 | 4,820,813,616.56 | 43.79% | Increased due to business growth in the current period. |
| Net cash flows from investing activities | -17,870,077,628.81 | -13,157,679,518.84 | 35.81% | Increased due to the increase in net cash outflow of wealth management products and the decrease in net cash outflow in |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Current Reporting Period | The same period of previous year | Increase/Decrease over the same period of previous year | Rationale | |
| acquisition of subsidiaries. | ||||
| Net cash flows from financing activities | 2,545,719,388.91 | 4,968,519,388.28 | -48.76% | Decreased due to the increase in the net cash outflow of borrowings and the increase in the net cash inflow of bonds. |
| Net increase in cash and cash equivalents | -8,373,723,779.87 | -3,371,261,536.58 | 148.39% | Please refer to the above analysis of cash flow changes for operating activities, investment activities and financing activities. |
Did significant changes occur in profit composition or sources of profit?
□Applicable √Not applicable
There were no significant changes in profit composition or sources of profit during the reporting period.
Composition of revenue
Unit: RMB
| Item | Current Reporting Period | The same period of previous year | Increase/Decrease over the same period of previous year | ||
| Amount | Proportion of Revenue | Amount | Proportion of Revenue | ||
| Revenue | 71,129,007,738.21 | 100% | 50,074,704,033.85 | 100% | 42.05% |
| Categorized by industry | |||||
| Express logistic and supply chain | 70,188,001,144.10 | 98.68% | 49,479,804,469.27 | 98.81% | 41.85% |
| Sales of goods | 452,123,296.72 | 0.64% | 253,670,085.55 | 0.51% | 78.23% |
| Others | 488,883,297.39 | 0.69% | 341,229,479.03 | 0.68% | 43.27% |
| Categorized by product | |||||
| Time-definite Express | 31,962,052,806.69 | 44.94% | 26,765,052,056.21 | 53.45% | 19.42% |
| Economy Product | 20,183,483,226.59 | 28.38% | 11,460,073,418.28 | 22.89% | 76.12% |
| Freight | 7,674,464,424.81 | 10.79% | 5,072,343,493.02 | 10.13% | 51.30% |
| Cold Chain and Pharmaceuticals | 3,240,731,441.57 | 4.56% | 2,352,046,365.17 | 4.70% | 37.78% |
| Intra-City Instant Delivery | 1,265,413,899.41 | 1.78% | 785,671,660.75 | 1.57% | 61.06% |
| International Express | 2,904,883,603.56 | 4.08% | 1,201,793,431.30 | 2.40% | 141.71% |
| Supply Chain | 2,956,971,741.47 | 4.16% | 1,842,824,044.54 | 3.68% | 60.46% |
| Others | 941,006,594.11 | 1.32% | 594,899,564.58 | 1.19% | 58.18% |
| Categorized by region | |||||
| Express logistic and supply chain –East China | 19,336,652,950.23 | 27.19% | 14,440,657,980.91 | 28.84% | 33.90% |
| Express logistic and supply chain –South China | 19,002,148,999.94 | 26.72% | 11,633,487,344.92 | 23.23% | 63.34% |
| Express logistic and supply chain –North China | 14,826,811,732.21 | 20.84% | 11,295,843,131.23 | 22.56% | 31.26% |
| Express logistic and supply chain –Central China | 9,226,900,387.54 | 12.97% | 6,674,286,669.48 | 13.33% | 38.25% |
| Express logistic and supply chain –West China | 5,664,614,722.70 | 7.96% | 3,995,871,735.90 | 7.98% | 41.76% |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Item | Current Reporting Period | The same period of previous year | Increase/Decrease over the same period of previous year | ||
| Amount | Proportion of Revenue | Amount | Proportion of Revenue | ||
| Categorized by region | |||||
| Express logistic and supply chain –Hong Kong and Macao | 1,406,433,781.68 | 1.98% | 1,106,991,784.15 | 2.21% | 27.05% |
| Express logistic and supply chain –Overseas | 724,438,569.80 | 1.02% | 332,665,822.68 | 0.66% | 117.77% |
| Sales of goods and others | 941,006,594.11 | 1.32% | 594,899,564.58 | 1.19% | 58.18% |
Note 1: Product revenue and district revenue in the preceding table have not been audited.Note 2: Any discrepancies in the above table between totals and sums of the amounts are due to rounding.
Industries, products, or regions accounting for more than 10% of company revenue or operating profit
√Applicable □Not applicable
The Company is required to comply with the disclosure requirements of the “Guidelines of the Shenzhen StockExchange for Industrial Information Disclosure No.9–Listed Companies Engaged in the Express DeliveryServices Business”
Unit: RMB
| Item | Revenue | Cost of revenue | Gross Profit Margin | Revenue Increase/ Decrease over the same period of previous year | Cost of revenue Increased or Decreased over the same period of previous year | Gross Profit Margin Increased or Decreased over the same period of previous year |
| Industries | ||||||
| Express logistic and supply chain | 70,188,001,144.10 | 57,121,320,304.19 | 18.62% | 41.85% | 43.97% | -1.19% |
During the reporting period, the Company has accounted its operation costs according to the nature of resources consumedappropriately. However, a fair and accurate allocation of cost by product or by region has not been possible. It was because theexpress and logistics industry itself was basically a complex network, by highly connection, overlaps in different types of resourcesconsumed, all direction of waybills, a tremendous number of customers, highly crossover of different types of resources fully shared.
Where the Company’s statistical criteria for core business data are adjusted during the reporting period, the corebusiness data for the most recent year have been adjusted based on the statistical criteria effective as of the end ofthe reporting period
□Applicable√Not applicable
Disclosure of express delivery volumes, revenues and average revenue per shipment and analysis of changes andrationaleFor more details, please refer to the “I. Overall Business Performance of the Company during the First Half of2020”under the section “Chapter 4 Management Discussion and Analysis of Business Operation”.
Explanation for related changes greater than 30% as compared with those in the prior year period
√Applicable □Not applicable
For more details, please refer to the “I. Overall Business Performance of the Company during the First Half of2020”under the section “Chapter 4 Management Discussion and Analysis of Business Operation” .
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
III. Non-core Business Analysis
√Applicable □Not applicable
Unit: RMB
| Item | Amount | Proportion of Total Profit | Reason | Whether sustainable |
| Investment income | 223,418,158.46 | 4.18% | Mainly including income from expired wealth management products. | Revenue from wealth management products is sustainable, while other investment income is not sustainable. |
| Gains and losses arising from changes in fair value | 16,413,953.16 | 0.31% | Mainly including changes in fair value of financial assets held for trading. | No |
| Asset impairment losses | -27,469,084.52 | -0.51% | Mainly including impairment losses of intangible assets | No |
| Non-operating income | 89,733,785.62 | 1.68% | Mainly including government grants unrelated to daily activities. | No |
| Non-operating expenses | 99,473,652.09 | 1.86% | Mainly including compensation expenses, donation and losses on scrapping of assets. | No |
| Credit impairment losses | -459,541,101.91 | -8.61% | Mainly including bad debt losses of accounts receivable, other receivables, loans and advances, and factoring receivables. | No |
| Other income | 645,710,052.98 | 12.09% | Mainly including government grants related to daily activities. | No |
IV. Analysis of Assets and Liabilities
1. Major Changes in Asset Composition
Unit: RMB
| Item | End of Current Reporting Period | End of previous year | Increase/ Decrease in Proportion | Major Changes | ||
| Amount | Proportion of Total Assets | Amount | Proportion of Total Assets | |||
| Cash at bank and on hand | 10,112,591,513.50 | 9.91% | 18,520,991,737.10 | 20.02% | -10.11% | For details, please refer to analysis on cash flow in“II. Analysis on Main Business” under Chapter 4 Management Discussion and Analysis of Business Operation. |
| Financial assets held for trading | 13,471,415,608.93 | 13.20% | 2,910,172,928.20 | 3.14% | 10.06% | Mainly due to increase in structured deposits. |
| Accounts receivable | 13,200,537,169.56 | 12.94% | 12,044,542,725.83 | 13.02% | -0.08% | No major changes. |
| Inventories | 834,416,314.91 | 0.82% | 881,658,973.69 | 0.95% | -0.13% | No major changes. |
| Other current assets | 7,482,260,841.70 | 7.33% | 3,299,684,720.94 | 3.57% | 3.76% | Mainly due to the increase of wealth management products. |
| Investment in other equity instruments | 5,059,004,416.40 | 4.96% | 4,933,692,937.19 | 5.33% | -0.37% | No major changes. |
| Long-term equity investments | 2,226,434,362.47 | 2.18% | 2,221,512,673.14 | 2.40% | -0.22% | No major changes. |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
2. Assets and liabilities measured at fair value
√Applicable □Not applicable
| Item | End of Current Reporting Period End of previous year | End of Current Reporting Period End of previous year | Increase/ Decrease in Proportion | Major Changes | ||
| Amount | Proportion of Total Assets | Amount | Proportion of Total Assets | |||
| Investment properties | 2,119,742,157.85 | 2.08% | 2,019,525,900.61 | 2.18% | -0.10% | No major changes. |
| Fixed assets | 19,645,792,982.24 | 19.25% | 18,903,827,062.42 | 20.43% | -1.18% | No major changes. |
| Construction in progress | 3,573,345,371.79 | 3.50% | 3,116,490,618.26 | 3.37% | 0.13% | No major changes. |
| Intangible assets | 10,164,552,265.54 | 9.96% | 10,008,036,356.04 | 10.82% | -0.86% | No major changes. |
| Goodwill | 3,627,083,179.38 | 3.55% | 3,564,540,458.80 | 3.85% | -0.30% | No major changes. |
| Short-term borrowings | 6,546,993,089.05 | 6.42% | 6,053,374,642.50 | 6.54% | -0.12% | The total amount of short-term borrowings, current portion of non-current liabilities, other current liabilities, long-term borrowings, and bonds payable increased by RMB2.604 billion compared with the end of previous year, which was attributable to the issuance of bonds. |
| Current portion of non-current liabilities | 2,350,398,255.88 | 2.30% | 2,091,892,291.74 | 2.26% | 0.04% | Please refer to the above short-term borrowings description. |
| Other current liabilities | 4,048,584,624.75 | 3.97% | 1,017,446,858.50 | 1.10% | 2.87% | Please refer to the above short-term borrowings description. |
| Long-term borrowings | 1,618,059,208.49 | 1.59% | 6,539,556,784.41 | 7.07% | -5.48% | Please refer to the above short-term borrowings description. |
| Bonds payable | 14,340,521,922.19 | 14.05% | 10,597,985,016.52 | 11.45% | 2.60% | Please refer to the above short-term borrowings description. |
| Accounts payable | 12,185,137,292.01 | 11.94% | 11,988,256,010.34 | 12.96% | -1.02% | No major changes. |
| Advances from customers | 16,851,919.37 | 0.02% | 669,948,930.72 | 0.72% | -0.70% | In accordance with the provisions of the new revenue standard, the obligations to transfer goods to customers for which considerations have been received or are due from customers, are accounted for as contract liabilities in the current period, which were presented as advances from customers at the end of previous year. |
| Contract liabilities | 1,117,387,097.90 | 1.09% | - | 0.00% | 1.09% | Same as the description of advances from customers above, except for the impact of reclassification, changes were mainly due to the increase in freight advances for certain businesses. |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
Unit: RMB
| Item | Opening Balance | Changes in Fair Value Gains and Losses in Current Period | Accumulated Fair Value Changes Included in Equity | Provision for Impairment in Current Period | Amount of purchase in current period | Amount of Sales in Current Period | Other Changes | Closing Balance |
| Financial assets | ||||||||
| 1. Financial assets held for trading (excluding derivative financial assets) Note1 | 3,388,967,567.15 | 16,657,233.30 | - | - | 10,386,850,316.03 | 864.84 | 215,212,313.14 | 14,007,686,564.78 |
| 2. Derivative financial assets | 245,792.67 | -243,280.14 | - | - | - | - | -2,512.53 | - |
| 3. Investments in other equity instruments | 4,933,692,937.19 | - | 49,338,455.33 | - | - | - | 75,973,023.88 | 5,059,004,416.40 |
| Total financial assets | 8,322,906,297.01 | 16,413,953.16 | 49,338,455.33 | - | 10,386,850,316.03 | 864.84 | 291,182,824.49 | 19,066,690,981.18 |
| Total | 8,322,906,297.01 | 16,413,953.16 | 49,338,455.33 | - | 10,386,850,316.03 | 864.84 | 291,182,824.49 | 19,066,690,981.18 |
Note1: Financial assets held for trading include structured deposits that do not carry the characteristics of contract cash flow forprincipal and interest. The structured deposits have short maturities and are highly liquid, and net purchases and sales for the currentperiod is stated in the current period.Other changesOther changes of financial assets held for trading mainly included income from expired wealth management products, other changesof investments in other equity instruments mainly included exchange differences on translation of foreign currency financialstatements.Did significant changes occur for the Company’s major asset measurement attributes during the reporting period?
□Yes √No
3. Limitation of asset rights as of the end of the reporting period
At the end of the reporting period, the Company’s assets with restricted rights are mainly used for mortgages of long-term bank loans,details of which are as follows：
| Item | Book Value at the End of Period（RMB） | Limitation Reason |
| Cash at bank | 794,717,467.25 | Legal reserves in the Central Bank |
| Financial assets held for trading | 15,000,000.00 | Guarantee deposits for bank acceptance notes |
| Fixed assets | 71,487,996.45 | Long-term borrowing mortgage |
| Intangible assets | 1,267,201,966.97 | Long-term borrowing mortgage |
| Investment properties | 203,339,490.96 | Long-term borrowing mortgage |
| Construction in progress | 157,683,272.03 | Long-term borrowing mortgage |
| Total | 2,509,430,193.66 |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
V. Analysis of Investments
1. General situation
√Applicable □Not applicable
The Company is required to comply with the disclosure requirements of the “Guidelines of the Shenzhen StockExchange for Industrial Information Disclosure No.9 –Listed Companies Engaged in the Express DeliveryServices Business.”
| Investment Amount During the Reporting Period (RMB) | Investment Amount During the same period of previous year (Restated) (RMB) | Change |
| 4,073,775,309.03 | 9,247,382,373.45 | -55.95% |
Of these, breakdown items of capital expenditure during the reporting period are as in the table below:
| Item | Investment Amount During the Reporting Period (RMB) |
| Office and Buildings | 200,344,004.13 |
| Land | 243,364,028.06 |
| Warehouse | 199,728,087.26 |
| Sorting center | 647,540,151.02 |
| Aircraft | 1,138,931,954.41 |
| Vehicle | 272,717,632.65 |
| Information technology equipment | 385,198,758.59 |
| Equity investments | 99,952,404.12 |
| Others | 885,998,288.79 |
| Total | 4,073,775,309.03 |
2. Significant Equity Investment Obtained During the Reporting Period
□Applicable √ Not applicable
3. Significant Non-Equity Investment Ongoing During the Reporting Period
□Applicable √ Not applicable
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
4. Financial Assets Measured at Fair Value
√Applicable □Not applicable
Unit: RMB
| Asset Type | Initial Investment Cost | Changes in Fair Value Gains and Losses in Current Period | Accumulated Fair Value Changes Included in Equity | Amount of Purchase During the Reporting Period | Amount of Sales During the Reporting Period | Accumulated Investment Income | Closing Balance | Capital source |
| Stock | 784,540,823.67 | - | 49,338,455.33 | - | - | 1,110,356.12 | 867,696,433.34 | Self-owned funds |
| Financial derivatives | - | -243,280.14 | - | - | - | 189,333.30 | - | Self-owned funds |
| Others Note1 | 16,892,687,960.70 | 16,657,233.30 | - | 10,386,850,316.03 | 864.84 | 213,058,095.41 | 18,198,994,547.84 | Self-owned funds/raised funds |
| Total | 17,677,228,784.37 | 16,413,953.16 | 49,338,455.33 | 10,386,850,316.03 | 864.84 | 214,357,784.83 | 19,066,690,981.18 | -- |
Note1: Financial assets held for trading include structured deposits that do not carry the characteristics of contract cash flow forprincipal and interest. The structured deposits have short maturities and are highly liquid, and net purchases and sales for the currentperiod is stated in the current period.
5. Investments in Financial Assets
（1）Investments in Securities
√ Applicable □Not applicable
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
Unit: RMB
| Security Type | Stock Code | Abbreviation of Security | Initial Investment | Accounting Measurement Model | Book value at the beginning of the reporting period | Gains and losses from changes in fair value during the period | Accumulated fair value changes included in equity | Purchase amount during the reporting period | Sales amount during the reporting period | Gains and losses of the reporting period | Book value at the end of the reporting period | Accounting items | Capital source |
| Domestic and foreign stock | 06166 | China VAST | 430,474,103.94 | Fair value measurement | 453,544,426.19 | - | 41,547,057.89 | - | - | - | 503,714,489.68 | Investments in other equity instruments | Self-owned funds |
| Domestic and foreign stock | 01810 | Xiaomi Corporation | 217,287,287.17 | Fair value measurement | 133,964,459.19 | - | 25,879,682.49 | - | - | - | 162,490,900.83 | Investments in other equity instruments | Self-owned funds |
| Domestic and foreign stock | 01492 | Zhongdi Dairy | 115,402,432.56 | Fair value measurement | 42,024,305.02 | - | -9,069,535.05 | - | - | - | 33,659,042.83 | Investments in other equity instruments | Self-owned funds |
| Domestic and foreign stock | 300771 | Zhilai Technology | 21,377,000.00 | Fair value measurement | 176,850,750.00 | - | -9,018,750.00 | - | - | 1,110,356.12 | 167,832,000.00 | Investments in other equity instruments | Self-owned funds |
| Other securities held at the end of the period | - | -- | - | - | - | - | - | - | - | -- | -- | ||
| Total | 784,540,823.67 | -- | 806,383,940.40 | - | 49,338,455.33 | - | - | 1,110,356.12 | 867,696,433.34 | -- | -- | ||
| Disclosure Date of Securities Investment Approval Board Announcement | N/A | ||||||||||||
| Disclosure Date of Securities Investment Approval Shareholders Meeting Announcement | N/A | ||||||||||||
（2）Investments in Derivatives
√ Applicable □Not applicable
Unit: RMB10 thousands
| Counterparty | Related- party relationship (Y/N) | Related-party transactions (Y/N) | Type of derivatives | Initial investment amount | Starting date | Ending date | Amount of purchase in the reporting period | Amount of sales in the the reporting period | Investment amount at the beginning of the reporting period | Provision for impairment（if any） | Investment amount at the end of the reporting period | Investment amount at the end of the reporting period to net assets of the Company | Gains/ (losses) recognized during the reporting period |
| Bank | No | No | Interest Rate swap contracts | - | 2016/7/25 | 2020/4/21 | - | - | 3,296.07 | - | - | - | 18.93 |
| Total | - | -- | -- | 3,296.07 | - | - | - | 18.93 | |||||
| Source of funds | Self-owned funds | ||||||||||||
| Lawsuit if applicable | N/A | ||||||||||||
| Disclosure Date of Derivatives Investment Approval Board Announcement（if any） | N/A | ||||||||||||
| Disclosure Date of Derivatives Investment Approval Shareholders Meeting Announcement (if any) | N/A | ||||||||||||
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Risk analysis and control measures for derivatives investment during the reporting period (including but not limited to market risk, liquidity risk, credit risk, operational risk, legal risk, etc.) | (I) Risk analysis The foreign exchange hedging business is carried out by the Company based on the principles of lawfulness, prudence, safety and effectiveness, and not for speculative purposes. All foreign exchange hedging transactions are derived from normal cross-border business, but certain risks may exist in foreign exchange hedging transactions. 1. Market risk: The foreign exchange hedging business carried out by the Company and its subsidiaries mainly involves daily cross-border intermodal transportation fees and investment and financing activities denominated in foreign currencies related to the main business. The associated market risk refer to losses which may arise from changes in price of foreign exchange hedging products due to fluctuations in market prices of underlying exchange rates and interest rates. 2. Liquidity risk: Since all foreign exchange hedging business is conducted through financial institutions, we are subject to the risk of having to pay fees to banks due to losses in closing out positions caused by insufficient liquidity in the market. 3. Non-performance risk: The Company and its subsidiaries conduct foreign exchange hedging business mainly based on rolling forecasts for risk management. We are subject to the risk that the actual cash flow deviates from forecast, resulting in failure to fulfill obligations under relevant hedging contracts when due. 4. Other risks: In the course of business, if the person concerned fails to report and seek approval in accordance with the prescribed procedures, or fails to make records on foreign exchange hedging business accurately, timely and completely, losses may be incurred or trading opportunities may be lost. At the same time, if the person concerned fails to fully understand the terms of the transaction contract and product information, we are exposed to related legal risks and transaction losses as a result. (II) Risk control measures 1. Clarify the criteria of initiating transaction of foreign exchange hedging product: All foreign exchange hedging businesses are derived from normal cross-border business for the purpose of averting and preventing exchange rate and interest rate risk. No foreign exchange derivatives trading shall be carried out for speculative purposes. 2. Selection of products: Hedging products with simple structure, strong liquidity and controllable risk are selected to carry out foreign exchange hedging business. 3. Counterparty selection: The counterparties of the Company's foreign exchange hedging business are large state-owned commercial banks and international banks with sound operation, good credit, long history of cooperation with the Company and good credit standing. 4. Determination of fair value of foreign exchange hedging products: The foreign exchange hedging products operated by the Company are mainly for the management of foreign exchange transactions in the predictable future period, with high market transparency and active trading; the transaction price and settlement unit price of which can fully reflect their fair value. The Company confirms the fair value of the hedging products in accordance with the transaction data provided by or obtained from the public domain including banks and Reuters. 5. Equipped with professional staff: The Company has maintained a team of professionals with expertise in financial derivatives, responsible for the company's exchange rate risk management, market analysis, product research and the Company's overall management policy recommendations, etc. 6. Establishing a comprehensive risk alarm and reporting mechanism: The Company sets risk limits for foreign exchange hedging business where transactions have been made, timely evaluates changes in risk exposure and derived gains and losses, and provides regular risk analysis report to the management and the Board of Directors. Appropriate risk assessment models or monitoring systems are used to continuously monitor and report various risks. More frequent reports are made when the market fluctuates drastically or when risks are higher. A response plan will be made promptly. 7. Separation of duties and personnel between the front end and back end is strictly implemented. Dealers cannot concurrently hold the position as accounting personnel and vice versa. |
| Changes in fair value or market price of invested derivatives during the reporting period (the specific methods ,relevant assumptions and parameters used in the analysis of the fair value should be disclosed) | The Company’s analysis of the fair value of derivatives is based on the financial market fair value valuation report provided by the bank at month end. |
| Explanation of whether the accounting policies and accounting principles of the Company's derivatives are significantly changed compared with the previous reporting period during the reporting period | No |
| Opinions of independent directors on the Company’s derivatives investment and risk control | The independent directors believed that the company had established an internal control system for foreign exchange hedging and effective risk control measures in accordance with the requirements stipulated by relevant laws. Under the premise of complying with national laws and regulations and ensuring that the company’s daily operation were not affected, the company used its own funds to carry out foreign exchange hedging in a timely manner, which was conducive to preventing interest rate and exchange rate risks, reducing the impact of interest rate fluctuations on the company, in line with the company ,the interests of all shareholders and was no harm to the company and all shareholders, especially the interests of minority shareholders. |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
6. Use of Raised Funds
√ Applicable □Not applicable
(1) Overall use of Raised Funds
√ Applicable □Not applicable
Unit: RMB10 thousands
| Total Raised Funds | 577,717.37 |
| Total Raised Funds invested in the current year | 65,040.24 |
| Accumulative Raised Funds invested (Note 1) | 284,286.45 |
| Total Raised Funds with usage altered in the reporting period | - |
| Accumulative Raised Funds with usage altered | - |
| Proportion of accumulative total Raised Funds with usage altered | - |
| Description for overall utilisation of Raised Funds | |
| As at 30 Juner 2020, the accumulated Funds Raised from Convertible Corporate Debentures that were utilised amounted to RMB2,842,864,500. Proceeds used for Aircraft Purchasing and Aviation Materials Purchasing and Maintenance Project totaled RMB733,556,500; that used for Intelligent Logistics Information System Construction Project totalled RMB137,567,900; that used for Express Delivery Equipment Automation Upgrade Project totalled RMB333,871,000; that used for Land Transport Capacity Improvement Project totaled RMB437,869,100; and that used for Repayment of Bank Loans totaled RMB1,200,000,000. To improve the utilisation of idle Funds Raised from Convertible Debentures and strengthen the profitability of the Raised Funds, according to the resolution at the 3th meeting of the 5th section of Board dated 23 March and the 2019 Annual General Meeting held on 15 April 2020, the Company was allowed to conduct cash management with the temporarily idle Funds Raised from Convertible Debentures on condition that the investment projects and utilisation of Funds Raised from Convertible Debentures are not affected. No more than RMB3.2 billion of idle Funds Raised shall be used for cash management, and funds within the quota may be reused. The effective period starts from the date of review and approval at the 2019 Annual General Meeting and ends at the 2021 Annual General Meeting. In the first half of 2020, within the quota as considered by the Board and the general meeting, the Company used idle Funds Raised to purchase capital-guaranteed wealth management products of commercial banks and other financial institutions. As at 30 Juner 2020, the Company’s unused Funds Raised from Convertible Corporate Debentures were RMB2,934,309,200, and bank interest received and income from wealth management received were RMB53,728,200. The balance of principal-guaranteed wealth management products purchased from banks and other financial institutions for cash management of idle Funds Raised from Convertible Corporate Debentures of RMB2,800,000,000 and the balance of special accounts for the funds raised from Convertible Corporate Debentures was RMB188,037,400. | |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
(2) Statement of committed investment projects of Raised Funds
√ Applicable □Not applicable
Unit: RMB10 thousands
| Committed investment projects and allocation of over-raised funds | Whether project has been (or partially) altered | Total committed investment based on net Raised Funds | Total investment after alteration (a) | Investment in the current year | Accumulative investment at the end of the period (b) | Investment progress at the end of the period (%) (d) = (b)/(a) | Date of asset ready for intended use | Benefits achieved in the current year | Whether expected benefits have been achieved | Whether feasibility of project has changed significantly |
| Committed investment projects | ||||||||||
| 1. Aircraft Purchasing and Aviation Materials Purchasing and Maintenance Project | No | 152,000.00 | 152,000.00 | 30,570.79 | 73,355.65 | 48.26% | 2022/11/22 | Note: 2 | N/A | No |
| 1.1 Aircraft Purchasing Project | No | 4,000.00 | 4,000.00 | - | 4,000.00 | 100.00% | 2019/11/30 | Note: 2 | N/A | No |
| 1.2 Aviation Materials Purchasing and Maintenance Project | No | 148,000.00 | 148,000.00 | 30,570.79 | 69,355.65 | 46.86% | 2022/11/22 | Note: 2 | N/A | No |
| 2. Intelligent Logistics Information System Construction Project | No | 146,717.37 | 146,717.37 | 4,104.95 | 13,756.79 | 9.38% | 2022/11/22 | Note: 3 | N/A | No |
| 2.1 Hardware Purchasing | No | 139,217.37 | 139,217.37 | 4,104.95 | 13,617.81 | 9.78% | 2022/11/22 | Note: 3 | N/A | No |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Committed investment projects and allocation of over-raised funds | Whether project has been (or partially) altered | Total committed investment based on net Raised Funds | Total investment after alteration (a) | Investment in the current year | Accumulative investment at the end of the period (b) | Investment progress at the end of the period (%) (d) = (b)/(a) | Date of asset ready for intended use | Benefits achieved in the current year | Whether expected benefits have been achieved | Whether feasibility of project has changed significantly |
| Committed investment projects | ||||||||||
| 2.2 Software Purchasing | No | 7,500.00 | 7,500.00 | - | 138.98 | 1.85% | 2022/11/22 | Note: 3 | N/A | No |
| 3.Express Delivery Equipment Automation Upgrade Project | No | 100,000.00 | 100,000.00 | 8,416.54 | 33,387.10 | 33.39% | 2022/11/22 | Note: 4 | N/A | No |
| 4. Land Transport Capacity Improvement Project | No | 59,000.00 | 59,000.00 | 21,947.96 | 43,786.91 | 74.22% | 2022/11/22 | Note: 5 | N/A | No |
| 5. Repayment of Bank Loans | No | 120,000.00 | 120,000.00 | - | 120,000.00 | 100.00% | 2019/11/30 | Note: 6 | N/A | No |
| Subtotal of committed investment projects | -- | 577,717.37 | 577,717.37 | 65,040.24 | 284,286.45 | -- | -- | -- | -- | -- |
| Investment of excess proceeds | N/A | |||||||||
| Total | -- | 577,717.37 | 577,717.37 | 65,040.24 | 284,286.45 | -- | -- | -- | -- | -- |
| Status of and reason for planned progress or estimated income not achieved (of a specific project) | N/A | |||||||||
| Significant changes in the feasibility of projects | N/A | |||||||||
| Amount, usage and use progress of over-raised Funds | N/A | |||||||||
| Change in implementation location of investment | N/A | |||||||||
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| projects of Raised Funds | |
| Adjustment to implementation method of investment projects of Raised Funds | N/A |
| Upfront investment and replacement of investment projects of Raised Funds | Pursuant to the resolution of the 27th meeting of the 4th Board of Directors on 25 November 2019 and the explicit consent given by the sponsor institution, the independent directors and the supervisory board, the Company was approved to replace upfront self-raised funds of RMB1,178,871,300 invested in the Aircraft Purchasing and Aviation Materials Purchasing and Maintenance Project, Intelligent Logistics Information System Construction Project, Express Delivery Equipment Automation Upgrade Project, Land Transport Capacity Improvement Project and Repayment of Bank Loans with the Raised Funds. Refer to the announcement (No. 2019-127) disclosed at the website of CNINFO (http://www.cninfo.com.cn) by the Company on 26 November 2019 for more details. |
| Supplementing working capital temporarily with idle Raised Funds | N/A |
| Balances of the Raised Funds during the project implementation and the reasons | N/A |
| Usage and allocation of the unused Raised Funds | N/A |
| Defects and other problems in utilisation and disclosure of the Raised Funds | N/A |
Note 1: “Accumulative Raised Funds invested” include accumulative Raised Funds invested and upfront investment replaced after the receipt of Raised Funds of RMB1,178,871,300.Note 2 :The project is aimed at expanding the Company’s own cargo fleet, and consolidating and improving the Company’s own air transportation capacity. The benefits achieved are notdirectly quantifiable.Note 3 :The project is aimed at increasing the capacity and efficiency of the Company’s information system, completing the layout of intelligent logistics informatisation technology, andpromoting the technology-driven business upgrading. The benefits achieved are not directly quantifiable.Note 4 :The project is aimed at improving the Company’s transshipment operation capacity and efficiency, increasing the storage service capacity and quality, and enhancing the stability of thetransshipment network and storage service network. The benefits achieved are not directly quantifiable.Note 5 :The project is aimed at improving the Company’s main and branch line transportation capacity and the efficiency of the “last kilometre” network service, and enhancing the security ofthe transportation network. The benefits achieved are not directly quantifiable.Note 6 :The project is aimed at reducing the Company’s interest expenses, improving the profitability, and lowering debt repayment risk and liquidity risk. The benefits achieved are not directlyquantifiable.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
(3) Statement of Altered Investment Projects of Raised Funds
□Applicable √ Not applicable
(4) Statement of Fundraising projects
| Overview of Fundraising projects | Disclosure date | Disclosure method |
| For more, please refer to “First Half 2020 Special Report on the Deposit Status and Actual Use of Funds Raised” | August 26, 2020 | http://www.cninfo.com.cn |
7. Major projects not involving fundraising
□Applicable √ Not applicable
VI. Sale of Significant Assets and Equity
1. Sale of significant assets
□Applicable √ Not applicable
The Company did not sell any significant assets during the reporting period.
2. Sale of significant equity
□Applicable √ Not applicable
The Company did not sell any significant equity during the reporting period.
VII. Analysis of Major Holdings and Participating Companies
√ Applicable □Not applicable
Major subsidiaries and equity participation companies that affect the Company’s net profit by more than 10%
Unit: RMB
| Company name | Company Type | Primary Business | Registered Capital | Total Assets | Net Assets | Operating Income | Operating Profit | Net Profit |
| Shenzhen S.F. Taisen Holdings (Group) Co., Ltd. | Subsidiary | Investments in industrial businesses, Investment consulting and other information consulting，supply chain management，asset management, capital management, investment management, etc. | RMB 2 billion | 38,422,900,226.23 | 22,685,536,594.39 | 2,198,370,225.18 | 728,901,437.36 | 516,834,116.17 |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
Acquisition and disposal of subsidiaries during the reporting period
√ Applicable □Not applicable
| Company Name | Acquisition or Disposal of Subsidiaries During the Reporting Period | Impact on Overall Production Operations and Performance |
| SF Supply Chain Chongqing （Hong Kong） Limited | New establishment | No major impact |
| EXEL Supply Chain (Shanghai) Co., Ltd. | New establishment | No major impact |
| Zonghao Supply Chain Consulting (Shenzhen) Co., Ltd. | New establishment | No major impact |
| Hunan SF Pharmaceutical Supply Chain Co., Ltd. | New establishment | No major impact |
| SF Express (Middle East) DWC-LLC | New establishment | No major impact |
| S.F. E&L INTERNATIONAL (CAMBODIA) CO., LTD. | New establishment | No major impact |
| SF EXPRESS PHILIPPINES INC. | New establishment | No major impact |
| SF EXPRESS (PANAMA), S.A. | New establishment | No major impact |
| Jiangxi SF Zhida Network Technology Co., Ltd. | New establishment | No major impact |
| Chongqing Fonair UAS Technologies Co., Ltd. | New establishment | No major impact |
| SF EXPRESS (BELGIUM) BV | New establishment | No major impact |
| FS TECHNOLOGY MACAU CO.,LTD. | New establishment | No major impact |
| Cheng Run Limited | New establishment | No major impact |
| NH Logistics Limited | New establishment | No major impact |
| Shanghai Bingzhi Supply Chain Management Co., Ltd. | New establishment | No major impact |
| EXEL Supply Chain (Nanjing) Co., Ltd. | New establishment | No major impact |
| EXEL Supply Chain (Xiamen) Co., Ltd. | New establishment | No major impact |
| EXEL Supply Chain (Dalian) Co., Ltd. | New establishment | No major impact |
| Shenzhen SF Kuaicha Technology Co., Ltd. | New establishment | No major impact |
| Shenzhen Weifengqi Technology Co., Ltd. | New establishment | No major impact |
| SF Express (Germany) GmbH | New establishment | No major impact |
| SF Technology Solution (HongKong)Limited | New establishment | No major impact |
| SF Xiangyu (Shandong) Pharmaceutical Logistics Co., Ltd. | New establishment | No major impact |
| Luoyang Fengtai Industrial Park Management Co., Ltd. | New establishment | No major impact |
| Liuzhou Fengyutai Industrial Park Management Co., Ltd. | New establishment | No major impact |
| Shenzhen Fengwang Express Co., Ltd. | New establishment | No major impact |
| Hangzhou Fengwang Express Co., Ltd. | New establishment | No major impact |
| Henan SF Pharmaceutical Supply Chain Co., Ltd. | New establishment | No major impact |
| SF International Holding Company Limited | New establishment | No major impact |
| Moral Up Corporation Limited | New establishment | No major impact |
| ABUNDANT HARVEST INVESTMENTS LIMITED | New establishment | No major impact |
| Hefei EXEL Supply Chain Co., Ltd. | New establishment | No major impact |
| Beijing Zhenlanwuxian Technology Co., Ltd. | New establishment | No major impact |
| EXEL Supply Chain (Xi'an) Co.，Ltd. | New establishment | No major impact |
| Shanghai Yongfang Supply Chain Technology Co., Ltd. | New establishment | No major impact |
| Guangdong Shuangjie Supply Chain Technology Co., Ltd. | New establishment | No major impact |
| Shanghai Fengzan Technology Co., Ltd. | New establishment | No major impact |
| Guangzhou SF Cold Chain Co., Ltd. | New establishment | No major impact |
| Xiamen Fengyi Supply Chain Management Co., Ltd. | New establishment | No major impact |
| Changsha Fengyi Supply Chain Management Co., Ltd. | New establishment | No major impact |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Company Name | Acquisition or Disposal of Subsidiaries During the Reporting Period | Impact on Overall Production Operations and Performance |
| Tianjin SF Juyi Logistics Co., Ltd. | New establishment | No major impact |
| Wuhan SF Cold Chain Co., Ltd. | New establishment | No major impact |
| SF Express (France) SAS | New establishment | No major impact |
| SF EXPRESS NIGERIA LIMITED | New establishment | No major impact |
| Fujian Lijie Supply Chain Management Co., Ltd. | New establishment | No major impact |
| SZSF GLOBAL EXPRESS (KENYA) LIMITED | New establishment | No major impact |
| EXEL Supply Chain Management (Shanghai) Co., Ltd. | New establishment | No major impact |
| SF International (Hong Kong) Management Company Limited | New establishment | No major impact |
| SF LOGISTICS MEXICO, S.A. DE C.V. | New establishment | No major impact |
| Shanghai SF Cold Chain Co., Ltd. | New establishment | No major impact |
| Shenzhen Fengyun Investment Co., Ltd. | New establishment | No major impact |
| HIGH SPRING GLOBAL LIMITED | Acquisition | No major impact |
| JADE AFFLUENT LIMITED | Acquisition | No major impact |
| HE CHANG TRADE LIMITED | Acquisition | No major impact |
| Shenzhen Nianfeng DDJ Technology Co., Ltd. | Sale | No major impact |
| Shenzhen Nianfeng DDJ Commerce Co., Ltd. | Sale | No major impact |
| Shenzhen Youli Technology Co., Ltd | Sale | No major impact |
| SF DDJ TECHNOLOGY (HONG KONG) CO., LIMITED | Sale | No major impact |
| Chengdu Yifeng Daojia Technology Service Co., Ltd. | cancellation | No major impact |
| Hengyang Hongyue Network Co., Ltd. | cancellation | No major impact |
| Hengyang Wanwei Information Co., Ltd. | cancellation | No major impact |
| Guangdong Zhifan Technology Co., Ltd. | cancellation | No major impact |
Descripitions for major holdings and participating CompaniesNet profit of Shenzhen S.F. Taisen Holdings (Group) Co., Ltd. mainly came from its principal operations.
VIII. Structured Entities Controlled by the Company
□Applicable √ Not applicable
IX. Performance forecast for the first nine months of 2020
□Applicable √ Not applicable
X. Possible risks and countermeasures
1. Market risks
Risks of macroeconomic fluctuations: The logistics industry plays an important fundamental role in thedevelopment of national economy while it is also significantly affected by macroeconomic conditions. In recentyears, China’s macroeconomy has experienced slowing growth as it underwent a period of economic structuretransition, and the future development will remain rather complicated. Future fluctuation of the macroeconomywill have a certain impact on the overall development of China’s logistics industry and the performance of SFHolding.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
Market competition risks: Competition in China’s express logistics industry has become increasingly fierce. Onthe one hand, industry-leading express logistics enterprises continue to strive to expand their businesses andnetworks. On the other hand, E-commerce platform enterprises, social capitals and other external forces arecreeping into the express logistics industry, further exacerbating market competition. If the Company cannot takeactive and effective measures to cope with the ever-changing market competition, it may face the risk of slowingbusiness growth and declining market share.
Risks arising from change in new business patterns: In recent years, with the rapid development of informationtechnology, the impact of the Internet economy on all aspects of life has become increasingly obvious. In theexpress delivery industry, information platform-type enterprises have emerged. Through fast matching andeffective management of information between supply and demand, such enterprises can quickly gather and utilizesocial capitals to deliver appropriate services for customers, which will have a certain impact on the traditionalbusiness model of the express delivery industry.
Risk response: In the face of complex and volatile potential market risks, the Company has established acomprehensive risk management system for close monitoring and dedicated analyses of the macroeconomy, ofindustry development trends and market competition patterns. From these analyses, SF Holding plans and adjustsits strategic direction, business planning and work priority in a forward-looking manner so as to minimize theimpact of changes in external market environment on the Company’s business and future development.
2. Policy risks
Risks arising from changes in industry regulations and industrial policies: Operation of express deliveryrequires business licensing and is subject to regulation by laws, administrative rules and industry standards suchas the Postal Law (《邮政法》), the Administrative Measures for Express Delivery Business Licensing (《快递业务经营许可管理办法》), the Administrative Measures for Express Delivery Market ( 《快递市场管理办法》), theIndustry Standard for Express Delivery Services (《快递服务》行业标准) and the Rules for Guiding the Operationof Express Business ( 《快递业务操作指导规范》). In order to support the development of the express deliveryindustry, competent departments at various levels have successively introduced a number of industrial support andencouragement policies. However, should major changes in or adjustments to relevant laws, regulations orindustrial policies occur in the future, they may have an impact on the development trend and market competitionlandscape of the express delivery industry, which may in turn affect the future business growth and performanceof the Company.
Risks from relevant state policies on environmental protection, energy conservation and emission reduction:
Various types and models of motor vehicles are important components of transportation vehicles of expressdelivery companies. With the intensifying state policies on environmental protection, energy conservation andemission reduction may lead to increased expenses in relevant aspects such as environmental protection, energyconservation and emission reduction incurred by express delivery companies, which may affect the futureperformance of the Company.
Risk response: The Company has established research teams for state and local policies in all business units toconduct in-depth analysis on relevant policies introduced and scientific prediction of future policy directions andtrends in the light of overall changes in external environment. Forward-looking plans are implemented andadjusted by fully capitalizing on favorable policies while avoiding policy risks, hence promoting business growth.
3. Business risks
Risks of possible rising costs: The traditional express delivery industry is a labor-intensive industry. There arerelatively large demands for labor along various stages of operation such as collection, sorting, transportation anddelivery. With decreasing rate of population growth in China, there are certain pressures on rising labor costswhile investments in logistics infrastructures and other aspects are also increasing. If the Company cannot secureenough business volume or effectively control costs in the future, it will probably face challenges in its futureperformance growth.
Risk response: SF Holding has continued to increase investment in areas such as logistics frameworkoptimization and system component innovation, including in areas such as bringing the entire logistics processonline by applying smart technologies to reduce manpower and offline operations, while upgrading service points
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
and route planning and using scientific and technological means to enhance efficiency and reduce labor costs,hence leading transformation of the express delivery industry from a labor-intensive to a technology intensiveindustry.
Risks from fuel price fluctuation: Transportation cost is one of the major costs of the express delivery industry,and fuel cost is a component of transportation cost. Fluctuation of fuel price will have a certain impact on theprofitability of express delivery companies. If the fuel price rises significantly in the future, the Company willexperience pressure of increased costs. Generally speaking, however, fuel costs accounted for only 1.65% ofrevenue in the first half of 2020, a ratio which is not high. Therefore, the impact of fuel price fluctuation onoperating costs is relatively limited. It is estimated that if fuel price fluctuates by +/- 5%, cost of revenue mayincrease or decrease by RMB116 million for the current year, which will either increase or decrease net profitattributable to the parent company by a maximum of RMB87 million.
Risk response: The Company will further optimise layout of service points, enhance scientific route planning andloading rate of operating routes, and increase resource use efficiency to reduce the risk of fuel price fluctuations.Further, the Company will strengthen promotion for use of new energy vehicles to reduce the risk of fuel pricefluctuations to a certain extent. Meanwhile, the Company has matured operation and cost monitoring mechanisms.When costs fluctuate significantly, operation plans and fuel cost control measures will be dynamically adjusted toreduce the negative impact of fuel cost fluctuation on the Company.
4. Exchange rate fluctuation risks
SF Holding is committed to providing accessible, reliable and integrated international express delivery, logisticsand supply chain solutions for domestic and foreign manufacturing companies, trading companies, cross-bordere-commerce businesses and consumers. Thus far, the Company has rolled out international logistics services incountries including Singapore, South Korea, Malaysia, Japan and Thailand, and B2C and e-commerce deliveryservices in a number of countries and regions. Going forward, as its overseas operations expand, businessesdenominated in foreign currencies are set to account for an increasing share of our total business volume. Giventhe uncertainties in the international financial environment and fluctuations in RMB’s exchange rates, theCompany’s foreign-currency assets, foreign-currency liabilities and future foreign-currency transactions will allbe subject to exchange rate risks, which will in turn affect the Company’s business performance or financialstatements.
Risk response: The Company’s foreign exchange transactions are mainly conducted based on the actual needs ofits cross-border foreign-currency businesses. To avoid and guard against risks associated with fluctuations inexchange rates and interest rates, better manage its foreign currency positions and become more competitive, theCompany has established the Management System for Hedging Business（《套期保值业务管理制度》）, andconducts centralized management of foreign currency positions, under which it decides expenditure based onrevenue, implements maturity matching and performs natural hedging wherever possible. It also uses financialderivatives and hedging products with low default risks and controllable risks to lock in the costs of exchange rateand interest rate and avoid the relevant risks. All the Company’s hedging transactions are conducted in strictcompliance with the relevant hedging principles, and are based on our normal production and business activitiesand justified with actual business operations. All the transactions are carried out for the purpose of locking incosts and avoiding risks. The Company does not trade for speculative purposes, and operates within its authorityto ensure effective execution and reduce the impact of exchange rate fluctuations on its operation and earnings. Interms of counterparty selection, the Company conducts foreign exchange hedging transactions only with large andestablished commercial banks home and abroad, and all such transactions conform to the principles of legality,prudence, safety and effectiveness. In addition, we will step up efforts to study and analyze exchange rates andinterest rates, closely monitor changes in the global markets, issue early warnings in time, and takecountermeasures accordingly.
5. Information system risk
Information system risk: To cope with our diversified development of, the complex and diverse needs ofcustomers, and the strategic direction of technology-led business expansion to enhance market position, theCompany has built and applied various information systems and technologies. Rapid development of the industryand changing market also pose challenge of rapid change in technology and services to the construction of corebusiness systems of the Company. With the wide variety and rapid replacement of professional technologies in the
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
Company along with emerging new technologies, changes in information technology and future businessrequirements may cause certain information system risks. Meanwhile, despite the series of information securitycontrol mechanisms established for the large amount of data accumulated for years by the Company, there stillexists certain human or system caused information security risks.
Risk Responses: The Company has formulated comprehensive response measure for information system risks.On the one hand, the Company continues to carry out operation and optimization of the ISO27001 informationsecurity management system and the ISO27701 privacy information management system. The Companyimplements information security control and protection in all aspects according to established policies andstrategies for information security, and continuously updates all procedures and systems for information security.It continuously strengthens risk awareness of staff and trainings for staff operation standards, develop internalinformation circulation guidelines, implement rules of strong control over sensitive information, avoidunintentional violations, and construct monitoring and pre-warning and response systems for abnormal behaviors,so as to eliminate information system security risks in their infancy. Meanwhile, according to requirements ofregulatory authorities, the Company has carried out evaluation for security classification protection of informationsystem. Based on high standards of technology protection requirements, it conduct continuous and stable securityintervention in the business system construction phase to strengthen the ability of the client’s service products andbusiness systems themselves against anti-security attacks, and enhance the capability of the IT infrastructures todiscover and defend against cybersecurity attacks during operation of the information system. On the other hand,the Company has established a more comprehensive system for prevention and control of information risks,formulated standard processes such as the Major Event Management Process System for IT System (《IT系统重大事件管理流程制度》) and the Management Guidelines for Emergency Plan Formulation and Implementation ofIT System (《IT系统应急预案制定与执行管理指引》) to implement closed-loop risk prevention and control interms of pre-warning, in-process control and post-recording. Additionally, the Company has actively cooperatedwith the National Development and Reform Commission, the State General Administration of Posts and all levelsof public security departments to combat behaviours such as black production and speculation; has activelyparticipated in the formulation and review of various information security standards of the National InformationSecurity Standards Committee, pilot work for implementation of policies; has regularly held security summits andsecurity salons to facilitate information sharing with industry leaders and industry elites; and has establishedalliance partnership and cooperation with information security teams of well-known Internet and e-commercecompanies for the joint construction of a safe and orderly Cyberspace.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
Chapter 5 Significant EventsI. Annual general meeting of shareholders and extraordinary general meeting of shareholdersheld during the period
1. Shareholder meetings held during the reporting period
| Meeting | Meeting Type | Investor Participation % | Date Convened | Disclosure Date | Disclosure Index |
| 2019 Annual General Meeting | Annual General Meeting | 75.74% | April 15, 2020 | April 16, 2020 | “2019 Annual General Meeting Resolutions” (2020-034)(http://www.cninfo.com.cn) |
2. Extraordinary general meetings convened at the request of preferred stockholders whose voting rightshave been restored
□Applicable √ Not applicable
II. Profit distribution or increase of share capital from equity reserves during the reportingperiod
□Applicable √ Not applicable
The Company does not plan to issue cash or equity dividends, nor to convert equity reserves into share capital.III. Commitments made by the Company's actual controllers, shareholders, related parties,purchasers, and others that were fulfilled during the reporting period or were not fulfilledand exceed the time limit as of the end of the reporting period
√ Applicable □Not applicable
| Commitment | Committed By | Commitment Type | Commitment Details | Committed Time | Commitment Period | Fulfillment Status |
| Commitments made during asset restructuring | Mingde Holding | Restricted sale of shares | 1. The shares of Dingtai New Materials subscribed by the company in this restructuring shall not be transferred in any way within 36 months from the date of registration of such shares in the name of the company, nor shall a third party be entrusted to manage such shares. 2. When the aforementioned lock-up period expires, if the underlying company fails to meet the committed net profits as stipulated in the “Profit Forecasting Compensation Agreement,” which requires the company to perform the share compensation obligation to Dingtai New Materials, and the share compensation obligation has not been fulfilled, the aforementioned lock-up period shall be extended to the date of completion of the company’s share-based compensation obligations under the “Profit Forecasting Compensation Agreement.” | January 23, 2017 | 3 years | Fulfilled |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| 3. Within six months after completion of the restructuring, if the closing price of Dingtai New Materials stock is lower than the issuance price for consecutive 20 trading days, or the closing price of the stock at the end of 6 months after the restructuring is completed is lower than the issuance price, the lock-up period of such stock held by the company is automatically extended for at least 6 months. (If dividend distribution, gifted shares, transfer of capital stock, or allotment to Dingtai New Materials occurred during the above period, the aforementioned issuance price is calculated based on the price adjusted by factors such as ex-dividend and ex-rights.) 4. After the completion of the transaction, the shares derived from Dingtai New Materials shares subscribed to by the company in this restructuring due to the distribution of stock dividends of Dingtai New Materials and the capitalization of the capital reserve to share capital shall also comply with the above-mentioned arrangement of restricted sale of shares. | |||
| Are the Commitments fulfilled on time? | Yes | ||
| If any commitment is overdue, the specific reasons for the incomplete performance and detailed plan of next steps. | N/A | ||
IV. Appointment and dismissal of accounting firmsIs the semi-annual financial report audited?
□Yes √ No
The Company’s semi-annual financial report has not been auditedV. Explanations provided by the Board of Directors, the Supervisory Committee, regardingthe “non-standard audit report” issued by the auditor for the reporting period
□Applicable √ Not applicable
VI. Explanations provided by the Board of Directors regarding the “non-standard auditreport” issued by the auditor for the last year
□Applicable √ Not applicable
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
VII. Bankruptcy and Reorganization
□Applicable √ Not applicable
There was no such situation for the Company during the reporting period.VIII. Significant lawsuit or arbitration
Significant lawsuit or arbitration
□Applicable √ Not applicable
There was no significant lawsuit or arbitration during the reporting period.
Other legal cases
√ Applicable □Not applicable
As of June 30, 2020, the legal proceedings of the listed Company and its subsidiaries were as follows:
1. The total amount involved in legal cases resolved during the reporting period was RMB81.14 million.
2. Cases not yet resolved during the reporting period include: Cases involving the Company and its subsidiaries asdefendants amounted to RMB129.35 million, accounting for 0.30% of audited net assets attributable toshareholders of the parent Company at the end of 2019. The above-mentioned litigation matters include a numberof independent traffic accident cases and transportation claims with small amounts involved. The Company and itssubsidiaries have already purchased commercial insurance for operating vehicles, transportation and otherbusiness activities. Based on the historical experience, the insurance purchased can basically cover the lossescaused by the case. Cases involving the Company and its subsidiaries as plaintiffs amounted to RMB404.32million, accounting for 0.95% of audited net assets attributable to shareholders of the parent Company at the endof 2019. The described legal proceedings will not have a material adverse effect on the Company’s financial statusand ability to continue operations.
IX. Questioning by the Media
□Applicable √ Not applicable
The company did not experience widespread media questioning during the reporting period.X. Punishment and rectification
□Applicable √ Not applicable
There was no such situation during the reporting period.XI. Integrity of the Company, its controlling shareholders, and actual controller
□Applicable √ Not applicable
XII. Execution of stock incentive plan, ESOP, or other employee incentives
√ Applicable □Not applicable
1. At the 28th meeting of the 4th session of the Board and the 2019 third extraordinary general meeting convenedby the Company on December 5, 2019 and December 27, 2019 respectively, the “Resolution regarding theRepurchase and Cancellation of Certain Restricted Shares” was considered and approved. Accordingly, theCompany was authorised to repurchase and cancel a total of 274,346 restricted shares held by 124 incentiveparticipants who ceased to be eligible for the incentive due to their resignation, at the repurchase price ofRMB24.633 per share. As of March 17, 2020, the Company has completed the repurchase and cancellation of theaforesaid restricted shares.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
2. At the 3th meeting of the 5th session of the Board and the 2019 annual general meeting convened by the Companyon March 23, 2020 and April 15, 2020 respectively, the “Resolution regarding the Repurchase and Cancellation ofCertain Restricted Shares” was considered and approved. Accordingly, the Company was authorised to repurchaseand cancel a total of 2,182,222 restricted shares held by 944 incentive participants who failed to fulfil the unlockingconditions due to failure of the Company to meet the performance assessment requirement for the second lock-upperiod of its 2018 restricted stock incentive plan, at the repurchase price of RMB24.741 per share.
3. At the 3th meeting of the 5th session of the Board convened by the Company on March 23, 2020, the “Resolutionon the Cancellation of Certain Share Appreciation Rights” was considered and approved. Accordingly, theCompany was authorised to cancel a total of 57,825 share appreciation rights held by 24 incentive participants whoceased to have exercise qualification due to failure of the Company to meet the performance assessmentrequirement for the second exercise period under the 2018 Share Appreciation Rights Incentive Plan.
4. As the Company has implemented the 2019 dividend distribution plan prior to implementing the repurchase andcancellation of restricted shares, according to the authorization of the Board, the management of the Companyadjusted the repurchase prices of the aforesaid repurchases based on relevant provisions. The repurchase price wasadjusted from RMB24.741 per share to RMB24.464 per share. As of June 19, 2020, the Company has completedthe repurchase and cancellation of the aforesaid restricted shares.
Details of the Company’s stock incentive plans during the reporting period have been disclosed onhttp://www.cninfo.com.cn by the Company. A disclosure index is as follows:
| Announcement | Disclosure Date | Disclosure Website |
| Announcement on Completion of Repurchase and Cancellation of Certain Restricted Shares (2020-016) | March 17, 2020 | http://www.cninfo.com.cn |
| Announcement on Repurchase and Cancellation of Certain Restricted Shares (2020-028) | March 24, 2020 | http://www.cninfo.com.cn |
| Announcement on Cancellation of Certain Share Appreciation Rights (2020-029) | March 24, 2020 | http://www.cninfo.com.cn |
| Announcement on Capital Reduction due to Repurchase and Cancellation of Certain Restricted Shares（2020-035） | April 16, 2020 | http://www.cninfo.com.cn |
| Announcement on Adjustment to Repurchase Price for the Repurchase and Cancellation of Restricted Shares by the Company due to Dividend Distribution (2020-040) | April 17, 2020 | http://www.cninfo.com.cn |
| Announcement on Completion of Repurchase and Cancellation of Certain Restricted Shares (2020-058) | June 19, 2020 | http://www.cninfo.com.cn |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
XIII. Significant related-party transactions
1. Related-party transactions relevant to routine operations
√ Applicable □Not applicable
| Related Party | Relationship | Type of related-party transaction | Details of related-party transaction | Pricing principle of the related-party transaction | Transaction price | Transaction amount (10 thousands RMB) | Proportion of same category of transactions | Approved transaction quota (10 Thousands RMB) | Was the approved quota exceeded? | Related-party Transaction settlement method | Similar Market price | Disclosure date | Disclosure index |
| Mingde Holding and its subsidiaries | Controlling shareholder of the Company | Provide services to related parties | Courier service, communication service, technology development service, etc. | Fair pricing based on market prices in accordance with the principle of independent transactions | Contract price | 5,751.46 | 0.08% | 37,000 | No | Settlement based on the settlement period and terms in the contract | N/A | December 7, 2019 | Announcement on the “Proposal on Estimated Daily Related-party Transaction Amount in 2020” disclosed at CNINFO (Announcement No. 2019-138) (http://www.cninfo.com.cn) |
| M China Management Limited and its subsidiaries and its franchisees | A director of The Company serves as a director of the parent company of M China Management Limited | Provide services to related parties | Supply chain service and distribution service | Fair pricing based on market prices in accordance with the principle of independent transactions | Contract price | 54,982.69 | 0.77% | 130,000 | No | Settlement based on the settlement period and terms in the contract | N/A | December 7, 2019 | Announcement on the “Proposal on Estimated Daily Related-party Transaction Amount in 2020” disclosed at CNINFO (Announcement No. 2019-138) (http://www.cninfo.com.cn) |
| CR-SF International Express Co., Ltd. | A senior manager of the Company serves as a director of CR-SF International Express Co., Ltd. | Provide services to related parties | Transportation services | Fair pricing based on market prices in accordance with the principle of independent transactions | Contract price | 3,442.21 | 0.05% | 10,000 | No | Settlement based on the settlement period and terms in the contract | N/A | December 7, 2019 | Announcement on the “Proposal on Estimated Daily Related-party Transaction Amount in 2020” disclosed at CNINFO (Announcement No. 2019-138) (http://www.cninfo.com.cn) |
| Mingde Holding and its subsidiaries | Controlling shareholder of the Company | Receive services from related parties | Express delivery agent service fees, etc. | Fair pricing based on market prices in accordance with the principle of independent transactions | Contract price | 10,462.93 | 0.18% | 18,000 | No | Settlement based on the settlement period and terms in the contract | N/A | December 7, 2019 | Announcement on the “Proposal on Estimated Daily Related-party Transaction Amount in 2020” disclosed at CNINFO (Announcement No. 2019-138) (http://www.cninfo.com.cn) |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Related Party | Relationship | Type of related-party transaction | Details of related-party transaction | Pricing Principle of the related-party transaction | Transaction price | Transaction amount (10 thousands RMB) | Proportion of same category of transactions | Approved transaction quota (10 Thousands RMB) | Was the approved quota exceeded? | Related-party Transaction settlement method | Similar Market price | Disclosure date | Disclosure index |
| CR-SF International Express Co., Ltd. | A senior manager of the Company serves as a director of CR-SF International Express Co., Ltd. | Receive services from related parties | Transportation services | Fair pricing based on market prices in accordance with the principle of independent transactions | Contract price | 19,112.87 | 0.33% | 50,000 | No | Settlement based on the settlement period and terms in the contract | N/A | December 7, 2019 | Announcement on the “Proposal on Estimated Daily Related-party Transaction Amount in 2020” disclosed at CNINFO (Announcement No. 2019-138) (http://www.cninfo.com.cn) |
| Mingde Holding and its subsidiaries | Controlling shareholder of the Company | Purchase of materials from related parties | Purchase of materials | Fair pricing based on market prices in accordance with the principle of independent transactions | Contract price | 15,414.04 | 0.27% | 33,000 | No | Settlement based on the settlement period and terms in the contract | N/A | December 7, 2019 | Announcement on the “Proposal on Estimated Daily Related-party Transaction Amount in 2020” disclosed at CNINFO (Announcement No. 2019-138) (http://www.cninfo.com.cn) |
| Zhejiang Galaxy Technology Company Limited | A director of the Company served as a director of Zhejiang Galaxy Technology Company Limited in the past 12 months | Purchase of assets from related parties | Purchase of assets | Fair pricing based on market prices in accordance with the principle of independent transactions | Contract price | 10.96 | 0.00% | 10,000 | No | Settlement based on the settlement period and terms in the contract | N/A | December 7, 2019 | Announcement on the “Proposal on Estimated Daily Related-party Transaction Amount in 2020” disclosed at CNINFO (Announcement No. 2019-138) (http://www.cninfo.com.cn) |
| Mingde Holding and its subsidiaries | Controlling shareholder of the Company | Lease of premises from related parties | Lease of premises | Fair pricing based on market prices in accordance with the principle of independent transactions | Contract price | 2,339.28 | 0.04% | 7,000 | No | Settlement based on the settlement period and terms in the contract | N/A | December 7, 2019 | Announcement on the “Proposal on Estimated Daily Related-party Transaction Amount in 2020” disclosed at CNINFO (Announcement No. 2019-138) (http://www.cninfo.com.cn) |
| Total | -- | -- | 111,516.44 | -- | 295,000 | -- | -- | -- | -- | -- | |||
| Details of large amount of sales returns | N/A | ||||||||||||
| Actual performance in the reporting period versus predicted total amount of daily related-party transactions, by types (if any) | The Company’s 28th meeting of the 4th session of the Board on December 5, 2019 and the third Extraordinary General Meeting of Shareholders of 2019 on December 27, 2019 reviewed and approved the “Proposal on Estimated Daily Related-party Transaction Amount in 2020.” The amount of the aforementioned related-party transactions did not exceed the approved amount. | ||||||||||||
| Reason for significant difference between the transaction price and the market price | N/A | ||||||||||||
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
2. Related-party transactions relevant to purchases and sales of assets
□Applicable √ Not applicable
No significant related-party transactions relevant to purchases and sales of assets during the reporting period.
3. Related-party transactions with joint investments
□Applicable √ Not applicable
No significant related-party transactions with joint investments during the reporting period.
4. Credits and liabilities with related parties
√ Applicable □Not applicable
Were there non-operating credits and liabilities with related parties?
□Yes √ No
No such cases in the reporting period.
5. Other significant related-party transactions
√ Applicable □Not applicable
(1) Issuance of convertible bonds by SF Express to related parties
In order to maintain the continuous development of the Company’s freight business and enhance its brand and core competitiveness,Shenzhen S.F. Express Co., Ltd. (“S.F. Express”), a subsidiary of the Company, introduced new investors during the reporting period.On February 28, 2020, S.F. Express signed an Investment Agreement with relevant investors under which the parties unanimouslyagreed that the investors will provide S.F. Express with a total amount of US$300 million or its equivalent in renminbi in the form ofconvertible bonds. The term of the convertible bonds is one year and that no interest is calculated. Under the premise that the agreedconditions are met, the convertible bonds will be converted into 150 million ordinary shares newly issued by S.F. Express at a priceof US$2 per share or its equivalent in renminbi. Within six months from the date of completion of conversion from the bonds intostock, SF Holding Limited, an overseas wholly-owned subsidiary of the Company, will subscribe for 200 million shares newly issuedby S.F. Express.CCP Freight Investment Limited (“CCP”), an investor in this transaction, is a wholly-owned subsidiary of a fund initiated andestablished by an indirectly controlled subsidiary of CITIC Capital Holdings Limited (“CITIC Capital”) as a general partner. ZhangYichen, Chairman and CEO of CITIC Capital, concurrently serves as director of the listed company. In addition, Zhang Yichen hasbeen appointed as a representative for the executive partner of Beijing Xinrunheng Equity Investment Partnership (LimitedPartnership) (“Beijing Xinrunheng”), an investor in this transaction. According to the Stock Listing Rules of Shenzhen StockExchange and other related regulations, Beijing Xinrunheng and CCP are related parties of the Company, and this transactionconstitutes a related party transaction. The above transaction was considered and approved at the 2nd meeting of the 5th session ofthe Board, the contents of which are detailed in the Company’s announcement (2020-013) disclosed on Cninfo.
(2) Joint establishment of a logistics real estate fund by the Company’s subsidiary with related parties
In order to promote the healthy development of the Company’s logistics real estate industry, integrate advantageous resources,promote the Company to achieve a benign interaction between industrial operation and capital management, and enhance theCompany’s core competitiveness, on April 23, 2020, Prosperity Sino Limited (“Prosperity Sino”), a subsidiary of the Company,signed a cooperation agreement with a subsidiary of CITIC Capital and other parties. The Company’s subsidiary plans to jointlyestablish a logistics real estate fund with a subsidiary of CITIC Capital to invest in logistics properties or project companies holdinglogistics properties in China’s first-tier and central cities. The target size of the fund is approximately US$350 million. The generalpartnership of the fund is jointly invested by Prosperity Sino and a subsidiary of CITIC Capital, each of which holds 50% of theshares. Meanwhile, the Company’s subsidiary, being a limited partner and a carried interest partner of the Fund, will subscribe to the
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
fund with a total investment of not exceeding 30% of the fund size and not exceeding US$105 million. The subsidiary of CITICCapital and other affiliates, being limited partners and carried interest partners of the Fund, will subscribe to the fund with a totalinvestment of not exceeding 10% of the fund size and not exceeding US$35 million.The counterparty of this transaction is a subsidiary of CITIC Capital. Zhang Yichen, director of the listed company, serves as thechairman and CEO of CITIC Capital. According to the Stock Listing Rules of Shenzhen Stock Exchange and other relatedregulations, this transaction constitutes a related party transaction. The above transaction was considered and approved at the 4thmeeting of the 5th session of the Board, the contents of which are detailed in the Company’s announcements (2020-006, 2020-045)disclosed on Cninfo.
(3) Waiver of preemptive rights on the capital increase of an investee company
In order to expand and strengthen the smart express lockers business, integrate high-quality industry resources, quickly seize anadvantageous position in the last-mile express logistics market, and provide better services to couriers and consumers, during thereporting period, Hive Box Holdings Limited (“Hive Box”), an investee company of the Company, made an important layout in thesmart express lockers market, and completed the merger and acquisition of China Post Zhidi Technology Co., Ltd. (“China PostZhidi”) through a package deal agreement. After this transaction has been completed, the original shareholder of China Post Zhidiwill reduce their capital and withdraw from China Post Zhidi. China Post Zhidi will become a domestic wholly-owned subsidiary ofHive Box. The original shareholder of China Post Zhidi (including subsidiaries designated by the original shareholder) will have theright to subscribe for shares newly issued by Hive Box and become a shareholder of Hive Box. The Company is not the originalshareholder of China Post Zhidi and will not participate in the subscription for this new shares issuance of Hive Box. After theoriginal shareholder of China Post Zhidi (including subsidiaries designated by the original shareholder) has exercised the warrants,the Company’s shareholdings in Hive Box will be diluted from 13.67% to 9.75%.In view of the fact that this package deal involves the original shareholders of Hive Box waiving their preemptive rights to increasecapital, and that the Company’s controlling shareholder Mingde Holdings, being the original shareholder of China Post Zhidi, has theright to subscribe for part of the shares of Hive Box, and Hive Box is an overseas subsidiary of Mingde Holdings, the controllingshareholder of the Company, according to the Stock Listing Rules of Shenzhen Stock Exchange and other related regulations,Mingde Holdings and Hive Box are related parties of the Company and therefore the Company’s waiver of preemptive rights on thecapital increase of its investee company Hive Box constitutes a related party transaction. The Company’s waiver of preemptive rightson the capital increase of its investee company Hive Box was considered and approved at the 5th meeting of the 5th session of theBoard, the contents of which are detailed in the Company’s announcement (2020-048) disclosed on Cninfo.Major related-party transactions were disclosed on the following websites:
| Announcement | Disclosure Date | Disclosure Website |
| Announcement on Signing of a Memorandum of Cooperation by an Wholly-owned Subsidiary with Related Parties (2020-006) | February 15, 2020 | http://www.cninfo.com.cn |
| Announcement on Signing of an Investment Agreement by the Company’s Subsidiary with Related Parties (2020-013) | February 29, 2020 | http://www.cninfo.com.cn |
| Announcement on Establishment of a Logistics Real Estate Fund by the Company’s Subsidiary with Related Parties (2020-045) | April 24, 2020 | http://www.cninfo.com.cn |
| Announcement on Waiver of Preemptive Rights on Captial Increase of an Investee Company and Related Party Transaction (2020-048) | May 6, 2020 | http://www.cninfo.com.cn |
XIV. Status of capital of the listed Company used for nonoperating purposes by thecontrolling shareholder or its related parties
□Applicable √ Not applicable
During the reporting period, no controlling shareholder or its related party used capital of the listed Company fornon-operating purposes
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
XV. Significant contracts and their execution
1. Trusteeships, Contracts, and Leases
(1) Trusteeships
□Applicable √ Not applicable
No significant trusteeships in the reporting period.
(2) Contracts
□Applicable √ Not applicable
No significant contracts in the reporting period.
(3) Leases
□Applicable √ Not applicable
No significant leases in the reporting period.
2. Significant guarantees
√Applicable □Not applicable
Guarantees provided by the Company
Unit: RMB 10 thousands
| The listed Company and its subsidiaries’ guarantees to external parties(Guarantees to subsidiaries are not included) | ||||||||||||
| Guaranteed party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed? | Guarantee for a related party? | ||||
| —— | —— | —— | —— | —— | —— | —— | —— | —— | ||||
| Total guarantee quota approved for external parties during the reporting period (B1) | 375,520.00 | Total actual amount of guarantees for external parties during the reporting period（B2） | - | |||||||||
| Total guarantee quota approved for external parties at the end of the reporting period（B3） | 375,520.00 | Total actual guarantee balance for external parties at the end of the reporting period（B4） | - | |||||||||
| The listed Company’s guarantees to subsidiaries | ||||||||||||
| Guaranteed party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed? | Guarantee for a related party? | ||||
| SF Holding Investment Limited | 2017/12/28 | 354,055.00 | 2018/7/26 | 354,055.00 | Joint liability guarantee | 2018/7/26-2023/7/26 | No | No | ||||
| SF Holding Limited | 2019/3/16 | 1,013,659.00 | 2019/6/21 | 371,893.09 | Joint liability guarantee | 2019/06/21-2020/02/28 | Yes | No | ||||
| SF Holding Limited | 2019/3/16 | 1,013,659.00 | 2019/7/12 | 59,385.95 | Joint liability guarantee | 2019/7/12-2020/02/28 | Yes | No | ||||
| SF Holding Limited | 2019/3/16 | 1,013,659.00 | 2019/7/19 | 25,535.96 | Joint liability guarantee | 2019/7/19-2020/02/28 | Yes | No | ||||
| SF Holding Investment Limited | 2019/1/4 | 600,000.00 | 2020/2/20 | 495,677.00 | Joint liability guarantee | 2020/2/20-2030/2/20 | No | No | ||||
| Total guarantee quota approved for subsidiaries during the reporting period (B1) | - | Total actual amount of guarantees for subsidiaries during the reporting period（B2） | 495,677.00 | |||||||||
| Total guarantee quota approved for the subsidiaries at the end of the reporting period（B3） | 849,732.00 | Total actual guarantee balance for subsidiaries at the end of the reporting period（B4） | 849,732.00 | |||||||||
| Subsidiary’s guarantees to subsidiaries | ||||||||||||
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Guaranteed party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed? | Guarantee for a related party? |
| Quanzhou Fengyutai Enterprise Management Co., Ltd. | 2015/9/24 | 2,210.00 | Joint liability guarantee | 2016/1/21-2020/6/5 | Yes | No | ||
| Quanzhou Fengyutai Enterprise Management Co., Ltd. | 2015/9/24 | 500.00 | Joint liability guarantee | 2016/1/21-2020/6/5 | Yes | No | ||
| Quanzhou Fengyutai Enterprise Management Co., Ltd. | 2015/9/24 | 1,500.00 | Joint liability guarantee | 2016/1/21-2020/6/5 | Yes | No | ||
| Quanzhou Fengyutai Enterprise Management Co., Ltd. | 2015/9/24 | 1,500.00 | Joint liability guarantee | 2016/1/21-2020/6/5 | Yes | No | ||
| Quanzhou Fengyutai Enterprise Management Co., Ltd. | 2015/9/24 | 100.00 | Joint liability guarantee | 2016/1/21-2020/6/5 | Yes | No | ||
| Quanzhou Fengyutai Enterprise Management Co., Ltd. | 2015/9/24 | 1,870.00 | Joint liability guarantee | 2016/1/21-2020/6/5 | Yes | No | ||
| Ningbo Fengtai E-commerce Industrial Park Management Co., Ltd. | 2016/8/11 | 2,092.50 | Joint liability guarantee | 2016/8/11-2020/6/15 | Yes | No | ||
| Tianjin SF Fengtai E-commerce Industrial Park Co., Ltd. | 2018/3/14 | 28,000.00 | 2018/10/19 | 6,877.00 | Joint liability guarantee | 2018/10/19-2033/10/19 | No | No |
| Tianjin SF Fengtai E-commerce Industrial Park Co., Ltd. | 2018/3/14 | 28,000.00 | 2018/10/19 | 2,200.00 | Joint liability guarantee | 2018/11/9-2033/10/19 | No | No |
| Tianjin SF Fengtai E-commerce Industrial Park Co., Ltd. | 2018/3/14 | 28,000.00 | 2018/10/19 | 1,100.00 | Joint liability guarantee | 2018/12/19-2033/10/19 | No | No |
| Tianjin SF Fengtai E-commerce Industrial Park Co., Ltd. | 2018/3/14 | 28,000.00 | 2018/10/19 | 2,150.00 | Joint liability guarantee | 2019/01/28-2033/10/19 | No | No |
| Wuhu Fengtai E-commerce Industrial Park Management Co., Ltd. | 2018/3/14 | 18,000.00 | 2019/1/18 | 160.50 | Joint liability guarantee | 2019/1/18-2020/4/20 | Yes | No |
| Wuhu Fengtai E-commerce Industrial Park Management Co., Ltd. | 2018/3/14 | 18,000.00 | 2019/1/18 | 589.50 | Joint liability guarantee | 2019/1/18-2034/1/18 | No | No |
| Wuhu Fengtai E-commerce Industrial Park Management Co., Ltd. | 2018/3/14 | 18,000.00 | 2019/1/18 | 6,688.00 | Joint liability guarantee | 2019/4/1-2034/1/18 | No | No |
| Shunyuan Financial Lease (Tianjin) Co., Ltd. | 2019/3/16 | 70,000.00 | 2019/4/22 | 2,000.00 | Joint liability guarantee | 2019/5/10-2020/4/20 | Yes | No |
| Shunyuan Financial Lease (Tianjin) Co., Ltd. | 2019/3/16 | 70,000.00 | 2019/4/22 | 16,000.00 | Joint liability guarantee | 2019/5/10-2024/01/24 | No | No |
| HAVI Logistics (Dongguan) Co., Ltd. | 2019/3/16 | 6,400.00 | 2019/5/10 | 375.00 | Joint liability guarantee | 2019/5/10-2020/4/18 | Yes | No |
| HAVI Logistics (Dongguan) Co., Ltd. | 2019/3/16 | 6,400.00 | 2019/5/10 | 4,875.00 | Joint liability guarantee | 2019/5/10-2021/4/18 | No | No |
| S.F. EXPRESS (CHINA) LIMITED | 2013/8/26 | 1,205.31 | Joint liability guarantee | 2015/5/18-2020/5/26 | Yes | No | ||
| S.F. EXPRESS (CHINA) LIMITED | 2013/8/26 | 2,102.65 | Joint liability guarantee | 2015/5/18-2020/5/26 | Yes | No | ||
| S.F. EXPRESS (CHINA) LIMITED | 2013/8/26 | 1,401.77 | Joint liability guarantee | 2015/5/18-2020/5/26 | Yes | No | ||
| S.F. EXPRESS (CHINA) LIMITED | 2013/8/26 | 1,407.03 | Joint liability guarantee | 2015/5/18-2020/5/26 | Yes | No | ||
| S.F. EXPRESS (CHINA) LIMITED | 2013/8/26 | 771.23 | Joint liability guarantee | 2015/5/18-2020/5/26 | Yes | No | ||
| S.F. EXPRESS (CHINA) LIMITED | 2013/8/26 | 84.64 | Joint liability guarantee | 2015/5/18-2020/5/26 | Yes | No | ||
| SF Holding Limited | 2016/7/25 | 3,289.07 | Joint liability guarantee | 2016/7/25-2020/4/27 | Yes | No | ||
| SF Holding Limited | 2016/12/30 | 509,400.00 | 2018/1/16 | 13,704.45 | Joint liability guarantee | 2018/1/16-2020/2/28 | Yes | No |
| SF Holding Limited | 2020/3/24 | 824,760.00 | 2020/5/25 | 9,136.30 | Joint liability guarantee | 2020/5/25-2021/5/25 | No | No |
| SF Holding Limited | 2018/3/14 | 522,300.00 | 2019/1/8 | 31,977.05 | Joint liability guarantee | 2019/1/8-2020/1/8 | Yes | No |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Subsidiary’s guarantees to subsidiaries | ||||||||
| Guaranteed party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed? | Guarantee for a related party? |
| Shenzhen Shuncheng Supply Chain Service Co., Ltd. | 2019/3/16 | 1,000.00 | 2020/4/14 | 1,000.00 | Joint liability guarantee | 2020/4/23-2021/4/23 | No | No |
| Shenzhen Shunlu Air Freight Forwarding Co., Ltd. | 2019/3/16 | 1,000.00 | 2020/4/14 | 1,000.00 | Joint liability guarantee | 2020/4/22-2021/4/22 | No | No |
| SF Holding Limited | 2016/12/30 | 509,400.00 | 2017/6/22 | 13.31 | Joint liability guarantee | 2017/6/22-2020/7/16 | No | No |
| S.F. EXPRESS (HONG KONG) LIMITED | 2018/3/14 | 1,500.00 | 2018/9/13 | 17.56 | Joint liability guarantee | 2018/9/13-2020/7/14 | No | No |
| S.F. EXPRESS (HONG KONG) LIMITED | 2018/3/14 | 1,500.00 | 2018/9/14 | 48.64 | Joint liability guarantee | 2018/9/14-2020/9/30 | No | No |
| S.F. EXPRESS (HONG KONG) LIMITED | 2018/3/14 | 1,500.00 | 2018/10/10 | 30.44 | Joint liability guarantee | 2018/10/10-2021/7/30 | No | No |
| SF Express ChongQing CO.LTD | 2018/3/14 | 1,700.00 | 2018/11/2 | 20.81 | Joint liability guarantee | 2018/11/2-2020/2/28 | Yes | No |
| S.F. EXPRESS (HONG KONG) LIMITED | 2018/3/14 | 1,500.00 | 2018/11/26 | 13.08 | Joint liability guarantee | 2018/11/26-2020/8/12 | No | No |
| S.F. EXPRESS (HONG KONG) LIMITED | 2018/3/14 | 1,500.00 | 2018/11/2 | 10.65 | Joint liability guarantee | 2018/11/2-2020/10/4 | No | No |
| Shanghai Fengtaiyuanxing Property Management Service Co., Ltd. | 2018/3/14 | 10,000.00 | 2018/9/1 | 4,578.29 | Joint liability guarantee | 2018/09/01-2021/08/31 | No | No |
| SF Airlines Company Limited | 2018/3/14 | 58,000.00 | 2018/12/25 | 2,500.00 | Joint liability guarantee | 2019/2/7-2021/2/7 | No | No |
| Anhui S.F. Express Co., Ltd. | 2018/3/14 | 900.00 | 2019/1/25 | 5.00 | Joint liability guarantee | 2019/1/25-2020/1/21 | Yes | No |
| S.F. EXPRESS (CHINA) LIMITED | 2018/3/14 | 1,500.00 | 2019/1/18 | 9.14 | Joint liability guarantee | 2019/1/18-2020/1/4 | Yes | No |
| Guangxi ShunFeng Express Co.,Ltd. | 2018/3/14 | 1,000.00 | 2019/1/21 | 100.00 | Joint liability guarantee | 2019/1/21-2020/1/31 | Yes | No |
| Hubei S.F. Express Co., Ltd. | 2018/3/14 | 1,800.00 | 2019/1/25 | 42.79 | Joint liability guarantee | 2019/1/25-2020/1/15 | Yes | No |
| NINGBO SHUNFENG EXPRESS CO.,LTD. | 2018/3/14 | 3,300.00 | 2019/1/7 | 500.00 | Joint liability guarantee | 2019/1/7-2020/12/31 | No | No |
| Shenzhen S.F. Supply Chain Co., Ltd. | 2018/3/14 | 26,100.00 | 2019/1/28 | 36.77 | Joint liability guarantee | 2019/1/28-2020/1/20 | Yes | No |
| Shenzhen Shunlu Air Freight Forwarding Co., Ltd. | 2018/3/14 | 3,000.00 | 2019/1/31 | 50.00 | Joint liability guarantee | 2019/1/31-2020/1/1 | Yes | No |
| Shenzhen Shunlu Logistics Co., Ltd. | 2018/3/14 | 1,000.00 | 2019/1/10 | 123.91 | Joint liability guarantee | 2019/1/10-2020/1/31 | Yes | No |
| SF Airlines Company Limited | 2018/3/14 | 58,000.00 | 2019/1/10 | 18.19 | Joint liability guarantee | 2019/1/10-2020/5/31 | Yes | No |
| S. F. Express (Shenyang) Co., Ltd | 2018/3/14 | 2,300.00 | 2019/1/21 | 10.00 | Joint liability guarantee | 2019/1/21-2020/4/30 | Yes | No |
| S. F. Express (Shenyang) Co., Ltd | 2018/3/14 | 2,300.00 | 2019/1/21 | 10.00 | Joint liability guarantee | 2019/1/21-2020/4/30 | Yes | No |
| S.F.EXPRESS (TIANJIN) CO., LTD. | 2018/3/14 | 1,000.00 | 2019/1/23 | 61.35 | Joint liability guarantee | 2019/1/23-2020/1/20 | Yes | No |
| S.F. EXPRESS (HONG KONG) LIMITED | 2018/3/14 | 1,500.00 | 2019/1/2 | 3.30 | Joint liability guarantee | 2019/1/2-2020/11/22 | No | No |
| S.F. EXPRESS (HONG KONG) LIMITED | 2018/3/14 | 1,500.00 | 2019/1/3 | 12.77 | Joint liability guarantee | 2019/1/3-2020/9/30 | No | No |
| Sichuan S.F. Express Co., Ltd. | 2018/3/14 | 1,800.00 | 2019/1/29 | 5.00 | Joint liability guarantee | 2019/1/29-2020/1/31 | Yes | No |
| TIANJIN S.F. EXPRESS CO., LTD. | 2018/3/14 | 1,400.00 | 2019/1/10 | 80.90 | Joint liability guarantee | 2019/1/10-2020/1/31 | Yes | No |
| S.F. EXPRESS (CHINA) LIMITED | 2018/3/14 | 1,500.00 | 2019/1/31 | 54.82 | Joint liability guarantee | 2019/1/31-2020/1/14 | Yes | No |
| Chongqing Huiyifeng Logistics Co., Ltd. | 2018/3/14 | 3,000.00 | 2019/1/31 | 1,500.00 | Joint liability guarantee | 2019/1/31-2020/1/24 | Yes | No |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Subsidiary’s guarantees to subsidiaries | ||||||||
| Guaranteed party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed? | Guarantee for a related party? |
| Wenzhou Shunheng Express Co., Ltd. | 2018/3/14 | 500.00 | 2019/2/20 | 2.00 | Joint liability guarantee | 2019/2/20-2020/1/6 | Yes | No |
| Jiangxi Shunlu Logistics Co.,Ltd. | 2018/3/14 | 100.00 | 2019/3/4 | 50.00 | Joint liability guarantee | 2019/3/4-2020/2/29 | Yes | No |
| Shenzhen S.F. Supply Chain Co., Ltd. | 2018/3/14 | 26,100.00 | 2019/3/5 | 1,300.00 | Joint liability guarantee | 2019/3/5-2020/3/28 | Yes | No |
| S.F. Express Co., Ltd. | 2018/3/14 | 30,000.00 | 2019/3/5 | 300.00 | Joint liability guarantee | 2019/3/5-2020/3/1 | Yes | No |
| Zhanjiang S.F. Express Co., Ltd. | 2018/3/14 | 700.00 | 2019/3/5 | 25.00 | Joint liability guarantee | 2019/3/5-2020/1/23 | Yes | No |
| Xi'an Shunlu Logistics Co., Ltd. | 2018/3/14 | 1,000.00 | 2019/3/13 | 222.02 | Joint liability guarantee | 2019/3/13-2020/3/9 | Yes | No |
| Xinjiang SF Express Co.,LTD. | 2018/3/14 | 600.00 | 2019/3/13 | 2.00 | Joint liability guarantee | 2019/3/13-2020/3/7 | Yes | No |
| SF Airlines Company Limited | 2018/3/14 | 58,000.00 | 2019/3/18 | 10.00 | Joint liability guarantee | 2019/3/18-2020/3/31 | Yes | No |
| Shenzhen Shunlu Logistics Co., Ltd. | 2018/3/14 | 1,000.00 | 2019/3/19 | 80.00 | Joint liability guarantee | 2019/3/19-2020/6/30 | Yes | No |
| Shenzhen SF Fix Technology Co., Ltd. | 2018/3/14 | 23,000.00 | 2019/3/26 | 400.00 | Joint liability guarantee | 2019/3/26-2020/1/31 | Yes | No |
| Yantai S.F. Express Co., Ltd. | 2018/3/14 | 500.00 | 2019/3/26 | 65.00 | Joint liability guarantee | 2019/3/26-2020/1/31 | Yes | No |
| SF Airlines Company Limited | 2018/3/14 | 58,000.00 | 2019/3/26 | 21.84 | Joint liability guarantee | 2019/3/26-2020/3/7 | Yes | No |
| Jiangsu S.F. Express Co., Ltd. | 2018/3/14 | 500.00 | 2019/3/27 | 28.15 | Joint liability guarantee | 2019/3/27-2020/3/19 | Yes | No |
| Tibet S.F. Express Co., Ltd. | 2018/3/14 | 100.00 | 2019/3/27 | 5.00 | Joint liability guarantee | 2019/3/27-2020/2/29 | Yes | No |
| S.F. Express (Huizhou) Co., Ltd. | 2018/3/14 | 2,500.00 | 2019/3/28 | 19.57 | Joint liability guarantee | 2019/3/28-2020/3/24 | Yes | No |
| Shenzhen S.F. Supply Chain Co., Ltd. | 2018/3/14 | 26,100.00 | 2019/3/28 | 600.00 | Joint liability guarantee | 2019/3/28-2020/2/29 | Yes | No |
| S.F. Express Co., Ltd. | 2018/3/14 | 30,000.00 | 2019/3/28 | 200.00 | Joint liability guarantee | 2019/3/28-2020/3/1 | Yes | No |
| S.F. Express Co., Ltd. | 2018/3/14 | 30,000.00 | 2019/3/29 | 3,000.00 | Joint liability guarantee | 2019/3/29-2020/3/14 | Yes | No |
| Jiangxi S.F. Express Co., Ltd. | 2018/3/14 | 1,300.00 | 2019/3/29 | 223.43 | Joint liability guarantee | 2019/3/29-2020/3/15 | Yes | No |
| ZHONGSHAN S.F. EXPRESS CO. LTD | 2018/3/14 | 1,000.00 | 2019/3/27 | 141.98 | Joint liability guarantee | 2019/3/27-2020/3/26 | Yes | No |
| Zhejiang Shun Feng Express Co., Ltd. | 2019/3/16 | 2,000.00 | 2019/4/29 | 50.00 | Joint liability guarantee | 2019/4/29-2020/4/28 | Yes | No |
| Beijing S.F. Express Co., LTD. | 2018/3/14 | 5,000.00 | 2019/4/3 | 100.00 | Joint liability guarantee | 2019/4/3-2020/4/20 | Yes | No |
| NINGBO SHUNFENG EXPRESS CO.,LTD. | 2019/3/16 | 2,500.00 | 2019/4/10 | 550.00 | Joint liability guarantee | 2019/4/10-2020/5/7 | Yes | No |
| Shenzhen Shunlu Logistics Co., Ltd. | 2019/3/16 | 2,100.00 | 2019/4/19 | 380.61 | Joint liability guarantee | 2019/4/19-2020/1/31 | Yes | No |
| SF Airlines Company Limited | 2019/3/16 | 26,000.00 | 2019/4/19 | 2,000.00 | Joint liability guarantee | 2019/4/19-2020/5/26 | Yes | No |
| S.F.Express(Dong Guan)Limited | 2019/3/16 | 1,800.00 | 2019/4/10 | 15.03 | Joint liability guarantee | 2019/4/10-2020/4/2 | Yes | No |
| S.F. Express Group (Shanghai) Co., Ltd. | 2019/3/16 | 800.00 | 2019/4/24 | 100.00 | Joint liability guarantee | 2019/4/24-2020/5/4 | Yes | No |
| SF Express ChongQing CO.LTD | 2019/3/16 | 800.00 | 2019/4/10 | 264.85 | Joint liability guarantee | 2019/4/10-2020/4/30 | Yes | No |
| SF Transportation (Nanjing) Co., Ltd. | 2019/3/16 | 300.00 | 2019/4/19 | 100.00 | Joint liability guarantee | 2019/4/19-2020/4/8 | Yes | No |
| S.F. EXPRESS (HONG KONG) LIMITED | 2019/3/16 | 8,200.00 | 2019/4/26 | 13.84 | Joint liability guarantee | 2019/4/26-2021/5/15 | No | No |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Subsidiary’s guarantees to subsidiaries | ||||||||
| Guaranteed party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed? | Guarantee for a related party? |
| Sichuan S.F. Express Co., Ltd. | 2019/3/16 | 500.00 | 2019/4/10 | 20.00 | Joint liability guarantee | 2019/4/10-2020/5/14 | Yes | No |
| Xinjiang SF Express Co.,LTD. | 2018/3/14 | 600.00 | 2019/4/3 | 6.00 | Joint liability guarantee | 2019/4/3-2020/2/29 | Yes | No |
| S.F. EXPRESS (HONG KONG) LIMITED | 2019/3/16 | 8,200.00 | 2019/5/23 | 91.36 | Joint liability guarantee | 2019/5/23-2022/5/31 | No | No |
| S.F. EXPRESS (HONG KONG) LIMITED | 2019/3/16 | 8,200.00 | 2019/5/23 | 154.04 | Joint liability guarantee | 2019/5/23-2022/5/31 | No | No |
| S.F. EXPRESS (CHINA) LIMITED | 2019/3/16 | 1,000.00 | 2019/5/29 | 45.68 | Joint liability guarantee | 2019/5/29-2020/7/6 | No | No |
| Anhui S.F. Express Co., Ltd. | 2019/3/16 | 500.00 | 2019/5/31 | 180.00 | Joint liability guarantee | 2019/5/31-2020/5/31 | Yes | No |
| Chengdu Taishun Logistics Co.,Ltd. | 2019/3/16 | 1,500.00 | 2019/5/22 | 900.00 | Joint liability guarantee | 2019/5/22-2020/4/30 | Yes | No |
| Hebei S.F. Express Co., Ltd. | 2019/3/16 | 300.00 | 2019/4/30 | 90.00 | Joint liability guarantee | 2019/4/30-2020/5/11 | Yes | No |
| Henan Huihai Logistics Co., Ltd. | 2018/3/14 | 300.00 | 2019/4/8 | 151.72 | Joint liability guarantee | 2019/4/8-2020/1/31 | Yes | No |
| Hubei S.F. Transportation Co., Ltd. | 2018/3/14 | 500.00 | 2019/4/8 | 323.29 | Joint liability guarantee | 2019/4/8-2020/3/20 | Yes | No |
| Liaoning Shunlu Logistics Co., Ltd. | 2019/3/16 | 700.00 | 2019/5/6 | 191.30 | Joint liability guarantee | 2019/5/6-2020/4/23 | Yes | No |
| Inner Mongolia S.F Express CO.Ltd. | 2019/3/16 | 100.00 | 2019/5/28 | 10.00 | Joint liability guarantee | 2019/5/28-2020/3/31 | Yes | No |
| Shenzhen S.F. Supply Chain Co., Ltd. | 2019/3/16 | 10,900.00 | 2019/4/30 | 3,000.00 | Joint liability guarantee | 2019/4/30-2020/3/31 | Yes | No |
| SF-Express(Ningxia)Co.,Ltd | 2018/3/14 | 200.00 | 2019/4/8 | 100.00 | Joint liability guarantee | 2019/4/8-2020/1/31 | Yes | No |
| S.F. Express Co., Ltd. | 2019/3/16 | 25,000.00 | 2019/5/6 | 100.00 | Joint liability guarantee | 2019/5/6-2020/4/30 | Yes | No |
| Wuxi S.F. Express Co., Ltd. | 2019/3/16 | 500.00 | 2019/5/23 | 20.00 | Joint liability guarantee | 2019/5/23-2020/5/24 | Yes | No |
| S.F. Express Co., Ltd. | 2019/3/16 | 25,000.00 | 2019/6/11 | 200.00 | Joint liability guarantee | 2019/6/11-2020/4/16 | Yes | No |
| Shenzhen Shuncheng Supply Chain Service Co., Ltd. | 2019/3/16 | 1,000.00 | 2019/6/19 | 23.00 | Joint liability guarantee | 2019/6/19-2020/5/31 | Yes | No |
| S.F. Express Co., Ltd. | 2019/3/16 | 25,000.00 | 2019/6/19 | 4.00 | Joint liability guarantee | 2019/6/19-2020/4/16 | Yes | No |
| Shanghai Shuncheng Logistics Co., Ltd. | 2019/3/16 | 2,000.00 | 2019/6/21 | 400.00 | Joint liability guarantee | 2019/6/21-2020/6/22 | Yes | No |
| FS ELECTRONIC TECHNOLOGY CO., LIMITED | 2019/3/16 | 4,000.00 | 2019/6/20 | 27.41 | Joint liability guarantee | 2019/6/20-2020/3/31 | Yes | No |
| Shenzhen SF Fix Technology Co., Ltd. | 2019/3/16 | 20,800.00 | 2019/6/5 | 1,600.00 | Joint liability guarantee | 2019/6/5-2020/6/30 | Yes | No |
| Shandong S.F. Express Co., Ltd. | 2019/3/16 | 1,000.00 | 2019/6/10 | 60.00 | Joint liability guarantee | 2019/6/10-2020/5/31 | Yes | No |
| XI`AN S.F EXPRESS CO.,LTD | 2019/3/16 | 300.00 | 2019/6/21 | 53.84 | Joint liability guarantee | 2019/6/21-2020/6/17 | Yes | No |
| Tibet S.F. Express Co., Ltd. | 2019/3/16 | 200.00 | 2019/5/29 | 2.00 | Joint liability guarantee | 2019/5/29-2020/4/30 | Yes | No |
| S.F. EXPRESS (CHINA) LIMITED | 2019/3/16 | 1,000.00 | 2019/6/11 | 45.68 | Joint liability guarantee | 2019/6/11-2020/5/31 | Yes | No |
| Shandong S.F. Express Co., Ltd. | 2019/3/16 | 1,000.00 | 2019/6/10 | 14.00 | Joint liability guarantee | 2019/6/10-2020/1/31 | Yes | No |
| Shandong S.F. Express Co., Ltd. | 2019/3/16 | 1,000.00 | 2019/6/21 | 255.00 | Joint liability guarantee | 2019/6/21-2020/6/30 | Yes | No |
| Xi'an Shunlu Logistics Co., Ltd. | 2019/3/16 | 400.00 | 2019/6/24 | 80.00 | Joint liability guarantee | 2019/6/24-2020/5/31 | Yes | No |
| S.F. Express Co., Ltd. | 2019/3/16 | 25,000.00 | 2019/6/26 | 300.00 | Joint liability guarantee | 2019/6/26-2020/5/31 | Yes | No |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Subsidiary’s guarantees to subsidiaries | ||||||||
| Guaranteed party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed? | Guarantee for a related party? |
| Wuxi S.F. Express Co., Ltd. | 2019/3/16 | 500.00 | 2019/6/27 | 73.08 | Joint liability guarantee | 2019/6/27-2020/6/27 | Yes | No |
| DHL Logistics (Beijing) Co., Ltd. | 2019/3/16 | 3,100.00 | 2019/5/10 | 237.86 | Joint liability guarantee | 2019/5/10-2020/7/15 | No | No |
| DHL Logistics (Beijing) Co., Ltd. | 2019/3/16 | 3,100.00 | 2019/5/13 | 58.86 | Joint liability guarantee | 2019/5/13-2020/7/15 | No | No |
| DHL Logistics (Beijing) Co., Ltd. | 2019/3/16 | 3,100.00 | 2019/6/13 | 24.85 | Joint liability guarantee | 2019/6/13-2020/7/31 | No | No |
| EXEL LOGISTICS CHINA CO.,LTD. | 2019/3/16 | 1,100.00 | 2019/6/13 | 63.61 | Joint liability guarantee | 2019/6/13-2020/1/31 | Yes | No |
| DHL Logistics (Beijing) Co., Ltd. | 2019/3/16 | 3,100.00 | 2019/4/17 | 50.00 | Joint liability guarantee | 2019/4/17-2020/3/21 | Yes | No |
| Yunnan S.F. Express Co., Ltd. | 2019/3/16 | 800.00 | 2019/6/24 | 221.86 | Joint liability guarantee | 2019/6/24-2020/5/31 | Yes | No |
| Chongqing Huiyifeng Logistics Co., Ltd. | 2019/3/16 | 3,000.00 | 2019/6/24 | 500.00 | Joint liability guarantee | 2019/6/24-2020/6/20 | Yes | No |
| SF Airlines Company Limited | 2019/3/16 | 26,000.00 | 2019/6/24 | 2.00 | Joint liability guarantee | 2019/6/24-2020/4/30 | Yes | No |
| SF Airlines Company Limited | 2018/3/14 | 58,000.00 | 2019/3/26 | 49.76 | Joint liability guarantee | 2019/3/26-2020/3/7 | Yes | No |
| SF Airlines Company Limited | 2019/3/16 | 26,000.00 | 2019/7/1 | 106.22 | Joint liability guarantee | 2019/7/1-2020/6/21 | Yes | No |
| Jinhua S.F. Express Co., Ltd. | 2019/3/16 | 200.00 | 2019/7/4 | 5.00 | Joint liability guarantee | 2019/7/4-2020/4/30 | Yes | No |
| Jiangsu S.F. Express Co., Ltd. | 2019/3/16 | 300.00 | 2019/7/10 | 18.02 | Joint liability guarantee | 2019/7/10-2020/4/30 | Yes | No |
| Jinhua S.F. Express Co., Ltd. | 2019/3/16 | 200.00 | 2019/7/18 | 83.68 | Joint liability guarantee | 2019/7/18-2020/8/9 | No | No |
| Jiangsu S.F. Express Co., Ltd. | 2019/3/16 | 300.00 | 2019/7/18 | 5.00 | Joint liability guarantee | 2019/7/18-2020/12/14 | No | No |
| Lanzhou S.F. Express Co., Ltd. | 2019/3/16 | 200.00 | 2019/7/18 | 15.00 | Joint liability guarantee | 2019/7/18-2020/6/30 | Yes | No |
| Shandong S.F. Express Co., Ltd. | 2019/3/16 | 1,000.00 | 2019/7/8 | 45.00 | Joint liability guarantee | 2019/7/8-2020/6/24 | Yes | No |
| Shanghai Shuncheng Logistics Co., Ltd. | 2019/3/16 | 2,000.00 | 2019/7/4 | 380.00 | Joint liability guarantee | 2019/7/4-2020/5/31 | Yes | No |
| Shanghai Shunheng Logistics Co., Ltd. | 2019/3/16 | 400.00 | 2019/7/4 | 100.00 | Joint liability guarantee | 2019/7/4-2020/9/30 | No | No |
| Shenzhen S.F. Supply Chain Co., Ltd. | 2019/3/16 | 11,900.00 | 2019/7/16 | 110.54 | Joint liability guarantee | 2019/7/16-2020/10/15 | No | No |
| SF Airlines Company Limited | 2019/3/16 | 26,000.00 | 2019/7/2 | 200.00 | Joint liability guarantee | 2019/7/2-2020/6/30 | Yes | No |
| Suzhou Industrial Park S.F. Express Co., Ltd. | 2019/3/16 | 1,900.00 | 2019/7/18 | 300.00 | Joint liability guarantee | 2019/7/18-2020/8/30 | No | No |
| Suzhou Industrial Park S.F. Express Co., Ltd. | 2019/3/16 | 1,900.00 | 2019/7/19 | 178.84 | Joint liability guarantee | 2019/7/19-2020/6/30 | Yes | No |
| Changchun Fengtai E-commerce Industrial Park Management Co., Ltd. | 2019/3/16 | 600.00 | 2019/7/16 | 209.00 | Joint liability guarantee | 2019/7/16-2021/7/23 | No | No |
| S.F. EXPRESS (HONG KONG) LIMITED | 2019/3/16 | 13,200.00 | 2019/7/4 | 26.99 | Joint liability guarantee | 2019/7/4-2021/2/19 | No | No |
| S.F. EXPRESS (HONG KONG) LIMITED | 2019/3/16 | 13,200.00 | 2019/7/3 | 70.81 | Joint liability guarantee | 2019/7/3-2020/3/31 | Yes | No |
| Hunan,S.F.Express(Group)Co.,Ltd. | 2019/3/16 | 2,000.00 | 2019/7/4 | 12.00 | Joint liability guarantee | 2019/7/4-2020/11/30 | No | No |
| SF Airlines Company Limited | 2019/3/16 | 26,000.00 | 2019/7/11 | 3.54 | Joint liability guarantee | 2019/7/11-2020/6/28 | Yes | No |
| SF Airlines Company Limited | 2019/3/16 | 26,000.00 | 2019/7/11 | 14.16 | Joint liability guarantee | 2019/7/11-2020/6/28 | Yes | No |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Subsidiary’s guarantees to subsidiaries | ||||||||
| Guaranteed party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed? | Guarantee for a related party? |
| Hunan,S.F.Express(Group)Co.,Ltd. | 2019/3/16 | 2,000.00 | 2019/8/19 | 12.00 | Joint liability guarantee | 2019/8/19-2020/11/30 | No | No |
| Beijing Shuncheng Logistics Co., Ltd. | 2019/3/16 | 8,500.00 | 2019/7/4 | 1,300.00 | Joint liability guarantee | 2019/7/4-2020/6/29 | Yes | No |
| Beijing Shuncheng Logistics Co., Ltd. | 2019/3/16 | 8,500.00 | 2019/7/4 | 500.00 | Joint liability guarantee | 2019/7/4-2020/6/27 | Yes | No |
| Shenzhen S.F. Supply Chain Co., Ltd. | 2019/3/16 | 11,900.00 | 2019/8/5 | 104.17 | Joint liability guarantee | 2019/8/5-2020/10/15 | No | No |
| Guang Zhou S.F. Express Co., Ltd. | 2019/3/16 | 4,000.00 | 2019/8/20 | 200.00 | Joint liability guarantee | 2019/8/20-2020/8/8 | No | No |
| Guang Zhou S.F. Express Co., Ltd. | 2019/3/16 | 4,000.00 | 2019/8/8 | 1,500.00 | Joint liability guarantee | 2019/8/8-2020/8/8 | No | No |
| Beijing S.F. Express Co., LTD. | 2019/3/16 | 1,500.00 | 2019/8/6 | 10.00 | Joint liability guarantee | 2019/8/6-2020/5/31 | Yes | No |
| Shenzhen Shuncheng Supply Chain Service Co., Ltd. | 2019/3/16 | 1,000.00 | 2019/7/16 | 20.45 | Joint liability guarantee | 2019/7/16-2020/6/30 | Yes | No |
| S.F.Express(Dong Guan)Limited | 2019/3/16 | 3,500.00 | 2019/8/15 | 11.74 | Joint liability guarantee | 2019/8/15-2020/6/4 | Yes | No |
| Shenzhen Shunlu Logistics Co., Ltd. | 2019/3/16 | 2,100.00 | 2019/7/31 | 140.00 | Joint liability guarantee | 2019/7/31-2020/9/30 | No | No |
| S.F.Express(Dong Guan)Limited | 2019/3/16 | 3,500.00 | 2019/8/15 | 508.77 | Joint liability guarantee | 2019/8/15-2020/7/14 | No | No |
| Quanzhou Shunlu Logistics Co., Ltd. | 2019/3/16 | 800.00 | 2019/8/16 | 15.00 | Joint liability guarantee | 2019/8/16-2020/6/30 | Yes | No |
| SF Express ChongQing CO.LTD | 2019/3/16 | 1,400.00 | 2019/7/31 | 253.77 | Joint liability guarantee | 2019/7/31-2020/9/30 | No | No |
| TIANJIN S.F. EXPRESS CO., LTD. | 2019/3/16 | 800.00 | 2019/7/4 | 130.00 | Joint liability guarantee | 2019/7/4-2020/7/29 | No | No |
| HaiNan S.F.Express LTD. | 2019/3/16 | 700.00 | 2019/8/16 | 177.28 | Joint liability guarantee | 2019/8/16-2020/8/31 | No | No |
| SF Airlines Company Limited | 2019/3/16 | 26,000.00 | 2019/8/23 | 5,000.00 | Joint liability guarantee | 2019/8/23-2021/8/15 | No | No |
| SF Airlines Company Limited | 2019/3/16 | 26,000.00 | 2019/8/22 | 3,000.00 | Joint liability guarantee | 2019/8/22-2021/8/15 | No | No |
| EXEL LOGISTICS CHINA CO.,LTD. | 2019/3/16 | 1,700.00 | 2019/7/24 | 156.01 | Joint liability guarantee | 2019/7/24-2020/7/31 | No | No |
| EXEL LOGISTICS CHINA CO.,LTD. | 2019/3/16 | 1,700.00 | 2019/7/10 | 50.01 | Joint liability guarantee | 2019/7/10-2020/7/31 | No | No |
| DHL LOGISTICS(CHINA) CO.,LTD. | 2019/3/16 | 5,900.00 | 2019/7/19 | 1,086.87 | Joint liability guarantee | 2019/7/19-2020/7/31 | No | No |
| S.F. EXPRESS (SINGAPORE) PRIVATE LIMITED | 2019/3/16 | 3,500.00 | 2019/8/31 | 162.30 | Joint liability guarantee | 2019/8/31-2020/8/31 | No | No |
| Wuxi S.F. Express Co., Ltd. | 2019/3/16 | 600.00 | 2019/7/3 | 174.68 | Joint liability guarantee | 2019/7/3-2020/7/31 | No | No |
| Hubei S.F. Express Co., Ltd. | 2019/3/16 | 1,000.00 | 2019/8/21 | 29.00 | Joint liability guarantee | 2019/8/21-2020/7/31 | No | No |
| SF-Express(Ningxia)Co.,Ltd | 2019/3/16 | 200.00 | 2019/8/29 | 12.00 | Joint liability guarantee | 2019/8/29-2020/8/31 | No | No |
| S.F. Express Co., Ltd. | 2019/3/16 | 25,000.00 | 2019/8/21 | 10.00 | Joint liability guarantee | 2019/8/21-2020/7/31 | No | No |
| Suzhou Industrial Park S.F. Express Co., Ltd. | 2019/3/16 | 1,900.00 | 2019/8/22 | 205.17 | Joint liability guarantee | 2019/8/22-2020/9/23 | No | No |
| Shenzhen SF Fix Technology Co., Ltd. | 2019/3/16 | 20,800.00 | 2019/8/28 | 40.00 | Joint liability guarantee | 2019/8/28-2020/5/30 | Yes | No |
| SF Technology Co., Ltd. | 2019/3/16 | 100.00 | 2019/8/29 | 5.00 | Joint liability guarantee | 2019/8/29-2020/1/8 | Yes | No |
| Shenzhen SF Comprehensive Logistics Service Co., Ltd. | 2019/3/16 | 2,500.00 | 2019/9/3 | 30.00 | Joint liability guarantee | 2019/9/3-2021/1/31 | No | No |
| Dongguan DHL Supply Chain Co., Ltd. | 2019/3/16 | 510.00 | 2019/9/2 | 148.63 | Joint liability guarantee | 2019/9/2-2020/9/30 | No | No |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Subsidiary’s guarantees to subsidiaries | ||||||||
| Guaranteed party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed? | Guarantee for a related party? |
| DHL Logistics (Beijing) Co., Ltd. | 2019/3/16 | 5,100.00 | 2019/9/27 | 53.30 | Joint liability guarantee | 2019/9/27-2020/9/30 | No | No |
| Shanghai Shunheng Logistics Co., Ltd. | 2019/3/16 | 400.00 | 2019/9/5 | 10.00 | Joint liability guarantee | 2019/9/5-2020/6/30 | Yes | No |
| Shenzhen Shuncheng Supply Chain Service Co., Ltd. | 2019/3/16 | 1,000.00 | 2019/9/20 | 25.04 | Joint liability guarantee | 2019/9/20-2020/8/31 | No | No |
| S. F. Express (Shenyang) Co., Ltd | 2019/3/16 | 600.00 | 2019/9/18 | 100.00 | Joint liability guarantee | 2019/9/18-2020/9/7 | No | No |
| Suzhou Industrial Park S.F. Express Co., Ltd. | 2019/3/16 | 1,900.00 | 2019/9/17 | 3.00 | Joint liability guarantee | 2019/9/17-2020/7/31 | No | No |
| TIANJIN S.F. EXPRESS CO., LTD. | 2019/3/16 | 800.00 | 2019/9/6 | 106.05 | Joint liability guarantee | 2019/9/6-2020/11/6 | No | No |
| XI`AN S.F EXPRESS CO.,LTD | 2019/3/16 | 600.00 | 2019/9/6 | 125.74 | Joint liability guarantee | 2019/9/6-2020/8/31 | No | No |
| Jiangxi S.F. Express Co., Ltd. | 2019/3/16 | 300.00 | 2019/9/3 | 17.27 | Joint liability guarantee | 2019/9/3-2020/10/31 | No | No |
| XI`AN S.F EXPRESS CO.,LTD | 2019/3/16 | 600.00 | 2019/9/10 | 50.47 | Joint liability guarantee | 2019/9/10-2020/7/31 | No | No |
| Henan Huihai Logistics Co., Ltd. | 2019/3/16 | 300.00 | 2019/9/17 | 3.00 | Joint liability guarantee | 2019/9/17-2020/12/31 | No | No |
| Suzhou Industrial Park S.F. Express Co., Ltd. | 2019/3/16 | 1,900.00 | 2019/9/27 | 5.00 | Joint liability guarantee | 2019/9/27-2020/8/15 | No | No |
| Shantou S.F. Express Co., Ltd. | 2019/3/16 | 200.00 | 2019/9/27 | 4.00 | Joint liability guarantee | 2019/9/27-2020/7/12 | No | No |
| Jiangxi S.F. Express Co., Ltd. | 2019/3/16 | 300.00 | 2019/9/27 | 15.00 | Joint liability guarantee | 2019/9/27-2020/9/14 | No | No |
| Hunan,S.F.Express(Group)Co.,Ltd. | 2019/3/16 | 2,000.00 | 2019/9/27 | 143.10 | Joint liability guarantee | 2019/9/27-2020/10/31 | No | No |
| Hubei S.F. Express Co., Ltd. | 2019/3/16 | 1,000.00 | 2019/9/27 | 100.00 | Joint liability guarantee | 2019/9/27-2020/7/31 | No | No |
| Zhejiang Shun Feng Express Co., Ltd. | 2019/3/16 | 2,800.00 | 2019/9/26 | 1,000.00 | Joint liability guarantee | 2019/9/26-2020/6/30 | Yes | No |
| S.F. Express Co., Ltd. | 2019/3/16 | 25,000.00 | 2019/9/26 | 75.88 | Joint liability guarantee | 2019/9/26-2020/7/31 | No | No |
| Anhui S.F. Express Co., Ltd. | 2019/3/16 | 1,000.00 | 2019/9/27 | 40.00 | Joint liability guarantee | 2019/9/27-2020/7/31 | No | No |
| Jiangsu S.F. Express Co., Ltd. | 2019/3/16 | 300.00 | 2019/9/18 | 47.26 | Joint liability guarantee | 2019/9/18-2020/7/14 | No | No |
| Beijing Shuncheng Logistics Co., Ltd. | 2019/3/16 | 8,500.00 | 2019/9/10 | 300.00 | Joint liability guarantee | 2019/9/10-2020/5/31 | Yes | No |
| Beijing Shuncheng Logistics Co., Ltd. | 2019/3/16 | 8,500.00 | 2019/9/10 | 100.00 | Joint liability guarantee | 2019/9/10-2020/5/31 | Yes | No |
| Anhui S.F. Express Co., Ltd. | 2019/3/16 | 1,000.00 | 2019/9/18 | 115.10 | Joint liability guarantee | 2019/9/18-2020/8/14 | No | No |
| Zhejiang Shun Feng Express Co., Ltd. | 2019/3/16 | 2,800.00 | 2019/9/20 | 56.01 | Joint liability guarantee | 2019/9/20-2020/7/31 | No | No |
| Zhejiang Shunlu Logistics Co.,Ltd. | 2019/3/16 | 5,000.00 | 2019/9/29 | 1,500.00 | Joint liability guarantee | 2019/9/29-2020/8/31 | No | No |
| Xi'an Shunlu Logistics Co., Ltd. | 2019/3/16 | 1,300.00 | 2019/9/29 | 9.42 | Joint liability guarantee | 2019/9/29-2020/8/31 | No | No |
| EXEL LOGISTICS CHINA CO.,LTD. | 2019/3/16 | 1,700.00 | 2019/10/12 | 145.63 | Joint liability guarantee | 2019/10/12-2020/7/30 | No | No |
| DHL Logistics (Beijing) Co., Ltd. | 2019/3/16 | 5,100.00 | 2019/10/30 | 300.00 | Joint liability guarantee | 2019/10/30-2020/9/30 | No | No |
| S.F. EXPRESS CORPORATION | 2019/3/16 | 1,000.00 | 2019/10/29 | 7.08 | Joint liability guarantee | 2019/10/29-2020/12/31 | No | No |
| S.F. EXPRESS (CHINA) LIMITED | 2019/3/16 | 4,000.00 | 2019/10/25 | 27.41 | Joint liability guarantee | 2019/10/25-2020/9/30 | No | No |
| S.F. EXPRESS (CHINA) LIMITED | 2019/3/16 | 4,000.00 | 2019/10/21 | 182.73 | Joint liability guarantee | 2019/10/21-2020/6/30 | Yes | No |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Subsidiary’s guarantees to subsidiaries | ||||||||
| Guaranteed party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed? | Guarantee for a related party? |
| Jiangxi S.F. Express Co., Ltd. | 2019/3/16 | 300.00 | 2019/10/23 | 50.00 | Joint liability guarantee | 2019/10/23-2020/5/31 | Yes | No |
| Sichuan S.F. Express Co., Ltd. | 2019/3/16 | 500.00 | 2019/10/24 | 5.19 | Joint liability guarantee | 2019/10/24-2020/11/30 | No | No |
| S. F. Express (Huzhou) Co., Ltd. | 2019/3/16 | 100.00 | 2019/10/28 | 10.00 | Joint liability guarantee | 2019/10/28-2020/7/31 | No | No |
| S. F. Express (Shenyang) Co., Ltd | 2019/3/16 | 600.00 | 2019/10/30 | 46.41 | Joint liability guarantee | 2019/10/30-2020/10/30 | No | No |
| S.F.EXPRESS (TIANJIN) CO., LTD. | 2019/3/16 | 300.00 | 2019/10/25 | 76.58 | Joint liability guarantee | 2019/10/25-2020/10/31 | No | No |
| S.F. Express Group (Shanghai) Co., Ltd. | 2019/3/16 | 800.00 | 2019/10/29 | 200.00 | Joint liability guarantee | 2019/10/29-2020/10/31 | No | No |
| S.F. Express Co., Ltd. | 2019/3/16 | 25,000.00 | 2019/10/23 | 30.00 | Joint liability guarantee | 2019/10/23-2020/10/15 | No | No |
| Shandong S.F. Express Co., Ltd. | 2019/3/16 | 1,000.00 | 2019/10/30 | 50.18 | Joint liability guarantee | 2019/10/30-2020/9/30 | No | No |
| Sichuan S.F. Express Co., Ltd. | 2019/3/16 | 500.00 | 2019/10/30 | 21.35 | Joint liability guarantee | 2019/10/30-2020/12/31 | No | No |
| Zhejiang Shun Feng Express Co., Ltd. | 2019/3/16 | 2,800.00 | 2019/10/30 | 300.00 | Joint liability guarantee | 2019/10/30-2020/12/7 | No | No |
| Zhejiang Shunlu Logistics Co.,Ltd. | 2019/3/16 | 5,000.00 | 2019/10/23 | 30.00 | Joint liability guarantee | 2019/10/23-2020/9/15 | No | No |
| Zhenjiang S.F. Express Co., Ltd. | 2019/3/16 | 100.00 | 2019/10/25 | 14.77 | Joint liability guarantee | 2019/10/25-2020/6/30 | Yes | No |
| Beijing Shuncheng Logistics Co., Ltd. | 2019/3/16 | 8,500.00 | 2019/10/16 | 527.59 | Joint liability guarantee | 2019/10/16-2020/9/30 | No | No |
| Jiangsu S.F. Express Co., Ltd. | 2019/3/16 | 300.00 | 2019/10/9 | 10.00 | Joint liability guarantee | 2019/10/9-2020/6/30 | Yes | No |
| Shenzhen SF Fix Technology Co., Ltd. | 2019/3/16 | 20,800.00 | 2019/10/9 | 250.00 | Joint liability guarantee | 2019/10/9-2020/12/31 | No | No |
| S.F. EXPRESS (HONG KONG) LIMITED | 2019/3/16 | 13,200.00 | 2019/10/2 | 21.93 | Joint liability guarantee | 2019/10/2-2022/7/14 | No | No |
| S.F. EXPRESS (HONG KONG) LIMITED | 2019/3/16 | 13,200.00 | 2019/10/2 | 11.50 | Joint liability guarantee | 2019/10/2-2021/8/25 | No | No |
| Beijing Shuncheng Logistics Co., Ltd. | 2019/3/16 | 8,500.00 | 2019/11/1 | 600.00 | Joint liability guarantee | 2019/11/1-2020/10/19 | No | No |
| Beijing Shuncheng Logistics Co., Ltd. | 2019/3/16 | 8,500.00 | 2019/11/11 | 563.53 | Joint liability guarantee | 2019/11/11-2020/10/26 | No | No |
| Liaoning Shunlu Logistics Co., Ltd. | 2019/3/16 | 1,600.00 | 2019/11/11 | 420.00 | Joint liability guarantee | 2019/11/11-2020/10/31 | No | No |
| Shanghai Shunheng Logistics Co., Ltd. | 2019/3/16 | 400.00 | 2019/11/29 | 49.56 | Joint liability guarantee | 2019/11/29-2020/10/31 | No | No |
| Hunan,S.F.Express(Group)Co.,Ltd. | 2019/3/16 | 2,000.00 | 2019/11/7 | 400.00 | Joint liability guarantee | 2019/11/7-2020/7/31 | No | No |
| Hunan,S.F.Express(Group)Co.,Ltd. | 2019/3/16 | 2,000.00 | 2019/11/7 | 200.00 | Joint liability guarantee | 2019/11/7-2020/7/31 | No | No |
| Beijing S.F. Express Co., LTD. | 2019/3/16 | 1,500.00 | 2019/11/7 | 464.88 | Joint liability guarantee | 2019/11/7-2020/9/22 | No | No |
| SF Data Service (Wuhan) Co., Ltd. | 2019/3/16 | 200.00 | 2019/11/7 | 77.76 | Joint liability guarantee | 2019/11/7-2020/10/31 | No | No |
| Beijing Shuncheng Logistics Co., Ltd. | 2019/3/16 | 8,500.00 | 2019/11/22 | 57.88 | Joint liability guarantee | 2019/11/22-2020/2/6 | Yes | No |
| Shenzhen S.F. Supply Chain Co., Ltd. | 2019/3/16 | 11,900.00 | 2019/11/22 | 1,000.00 | Joint liability guarantee | 2019/11/22-2020/10/30 | No | No |
| GZ SF Pharmaceutical Supply Chain Co., Ltd. | 2019/3/16 | 500.00 | 2019/11/29 | 10.00 | Joint liability guarantee | 2019/11/29-2020/1/24 | Yes | No |
| Anhui S.F. Express Co., Ltd. | 2019/3/16 | 1,000.00 | 2019/11/22 | 73.64 | Joint liability guarantee | 2019/11/22-2020/6/30 | Yes | No |
| Xi'an Shunlu Logistics Co., Ltd. | 2019/3/16 | 1,300.00 | 2019/11/13 | 547.78 | Joint liability guarantee | 2019/11/13-2020/10/31 | No | No |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Subsidiary’s guarantees to subsidiaries | ||||||||
| Guaranteed party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed? | Guarantee for a related party? |
| Weihai S.F. Express Co., Ltd. | 2019/3/16 | 100.00 | 2019/11/15 | 1.00 | Joint liability guarantee | 2019/11/15-2021/1/31 | No | No |
| Weihai S.F. Express Co., Ltd. | 2019/3/16 | 100.00 | 2019/11/15 | 1.00 | Joint liability guarantee | 2019/11/15-2021/1/31 | No | No |
| SF Airlines Company Limited | 2019/3/16 | 26,000.00 | 2019/11/15 | 300.00 | Joint liability guarantee | 2019/11/15-2020/5/13 | Yes | No |
| Nantong S.F. Express Co., Ltd. | 2019/3/16 | 100.00 | 2019/11/1 | 13.47 | Joint liability guarantee | 2019/11/1-2020/2/29 | Yes | No |
| SF Airlines Company Limited | 2019/3/16 | 26,000.00 | 2019/11/20 | 7.08 | Joint liability guarantee | 2019/11/20-2020/9/1 | No | No |
| S.F. EXPRESS (CHINA) LIMITED | 2019/3/16 | 4,000.00 | 2019/11/29 | 18.27 | Joint liability guarantee | 2019/11/29-2020/11/30 | No | No |
| DHL LOGISTICS(CHINA) CO.,LTD. | 2019/3/16 | 5,900.00 | 2019/11/21 | 135.00 | Joint liability guarantee | 2019/11/21-2020/2/28 | Yes | No |
| DHL LOGISTICS(CHINA) CO.,LTD. | 2019/3/16 | 5,900.00 | 2019/11/21 | 6.00 | Joint liability guarantee | 2019/11/21-2020/2/28 | Yes | No |
| FS ELECTRONIC TECHNOLOGY CO., LIMITED | 2019/3/16 | 4,000.00 | 2019/11/12 | 31.98 | Joint liability guarantee | 2019/11/12-2020/9/22 | No | No |
| ZHONGSHAN S.F. EXPRESS CO. LTD | 2019/3/16 | 200.00 | 2019/11/21 | 17.16 | Joint liability guarantee | 2019/11/21-2020/9/14 | No | No |
| Shenzhen SF Fix Technology Co., Ltd. | 2019/3/16 | 20,800.00 | 2019/12/3 | 20.00 | Joint liability guarantee | 2019/12/3-2020/7/31 | No | No |
| S. F. Express (Shenyang) Co., Ltd | 2019/3/16 | 600.00 | 2019/12/3 | 107.75 | Joint liability guarantee | 2019/12/3-2020/11/30 | No | No |
| Shanghai Shunxiaofeng Transportation Co., Ltd. | 2019/3/16 | 200.00 | 2019/12/12 | 20.00 | Joint liability guarantee | 2019/12/12-2020/11/24 | No | No |
| Hebei S.F. Express Co., Ltd. | 2019/3/16 | 300.00 | 2019/12/18 | 1.00 | Joint liability guarantee | 2019/12/18-2020/11/14 | No | No |
| Shenzhen S.F. Supply Chain Co., Ltd. | 2019/3/16 | 11,900.00 | 2019/12/12 | 1,500.00 | Joint liability guarantee | 2019/12/12-2020/3/31 | Yes | No |
| GZ SF Pharmaceutical Supply Chain Co., Ltd. | 2019/3/16 | 500.00 | 2019/12/20 | 10.00 | Joint liability guarantee | 2019/12/20-2020/10/31 | No | No |
| SF Airlines Company Limited | 2019/3/16 | 26,000.00 | 2019/12/18 | 150.00 | Joint liability guarantee | 2019/12/18-2020/5/13 | Yes | No |
| HaiNan S.F.Express LTD. | 2019/3/16 | 700.00 | 2019/12/30 | 100.00 | Joint liability guarantee | 2019/12/30-2020/11/30 | No | No |
| Hubei S.F. Express Co., Ltd. | 2019/3/16 | 1,000.00 | 2019/12/13 | 16.07 | Joint liability guarantee | 2019/12/13-2020/11/30 | No | No |
| Jiangxi S.F. Express Co., Ltd. | 2019/3/16 | 300.00 | 2019/12/18 | 36.85 | Joint liability guarantee | 2019/12/18-2020/2/29 | Yes | No |
| S.F.Express(Dong Guan)Limited | 2019/3/16 | 3,500.00 | 2019/12/30 | 993.23 | Joint liability guarantee | 2019/12/30-2020/12/20 | No | No |
| XIAMEN SHUNFENG EXPRESS CO.,LTD. | 2019/3/16 | 300.00 | 2019/12/30 | 40.00 | Joint liability guarantee | 2019/12/30-2020/12/31 | No | No |
| SF Express ChongQing CO.LTD | 2019/3/16 | 1,400.00 | 2019/12/24 | 21.65 | Joint liability guarantee | 2019/12/24-2020/11/30 | No | No |
| Zhejiang Shunlu Logistics Co.,Ltd. | 2019/3/16 | 5,000.00 | 2019/12/30 | 108.78 | Joint liability guarantee | 2019/12/30-2020/12/25 | No | No |
| S.F. Express Group (Shanghai) Co., Ltd. | 2019/3/16 | 800.00 | 2019/12/24 | 11.76 | Joint liability guarantee | 2019/12/24-2020/11/30 | No | No |
| Shenzhen Shunlu Air Freight Forwarding Co., Ltd. | 2019/3/16 | 6,500.00 | 2019/12/30 | 2,238.00 | Joint liability guarantee | 2019/12/30-2020/12/31 | No | No |
| DHL Logistics (Beijing) Co., Ltd. | 2019/3/16 | 5,100.00 | 2019/12/3 | 32.43 | Joint liability guarantee | 2019/12/3-2020/11/30 | No | No |
| EXEL LOGISTICS CHINA CO.,LTD. | 2019/3/16 | 1,700.00 | 2019/12/3 | 86.22 | Joint liability guarantee | 2019/12/3-2020/9/30 | No | No |
| DHL Logistics (Beijing) Co., Ltd. | 2019/3/16 | 5,100.00 | 2019/12/2 | 53.21 | Joint liability guarantee | 2019/12/2-2021/2/28 | No | No |
| DHL Logistics (Beijing) Co., Ltd. | 2019/3/16 | 5,100.00 | 2019/12/27 | 0.31 | Joint liability guarantee | 2019/12/27-2021/2/28 | No | No |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Subsidiary’s guarantees to subsidiaries | ||||||||
| Guaranteed party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed? | Guarantee for a related party? |
| SF Airlines Company Limited | 2019/3/16 | 26,000.00 | 2019/12/13 | 1,416.22 | Joint liability guarantee | 2019/12/13-2020/11/30 | No | No |
| S.F. EXPRESS (HONG KONG) LIMITED | 2019/3/16 | 13,200.00 | 2019/12/23 | 5,832.29 | Joint liability guarantee | 2019/12/23-2020/6/19 | Yes | No |
| S.F. EXPRESS (HONG KONG) LIMITED | 2019/3/16 | 13,200.00 | 2019/12/23 | 3,468.22 | Joint liability guarantee | 2019/12/23-2020/6/19 | Yes | No |
| S.F. EXPRESS (CHINA) LIMITED | 2019/3/16 | 4,000.00 | 2019/12/10 | 1,272.69 | Joint liability guarantee | 2019/12/10-2020/12/14 | No | No |
| S.F. EXPRESS (CHINA) LIMITED | 2019/3/16 | 4,000.00 | 2019/12/30 | 9.14 | Joint liability guarantee | 2019/12/30-2021/1/4 | No | No |
| S.F. EXPRESS (CHINA) LIMITED | 2019/3/16 | 4,000.00 | 2019/12/30 | 13.70 | Joint liability guarantee | 2019/12/30-2020/12/31 | No | No |
| DHL Logistics (Beijing) Co., Ltd. | 2019/3/16 | 5,100.00 | 2019/7/31 | 1,139.00 | Joint liability guarantee | 2019/7/31-2020/12/31 | No | No |
| Shenzhen Fengtai E-commerce Industrial Park Property Service Co., Ltd. | 2019/3/16 | 3,700.00 | 2019/8/1 | 3,342.61 | Joint liability guarantee | 2019/8/1-2022/7/31 | No | No |
| Yiwu Fengyutai Enterprise Management Co., Ltd. | 2019/3/16 | 1,400.00 | 2019/8/1 | 1,239.44 | Joint liability guarantee | 2019/8/1-2022/7/31 | No | No |
| Huai'an Fengtai Enterprise Management Co., Ltd. | 2019/3/16 | 400.00 | 2019/8/1 | 315.54 | Joint liability guarantee | 2019/8/1-2022/7/31 | No | No |
| Shenzhen S.F. Supply Chain Co., Ltd. | 2019/3/16 | 11,900.00 | 2020/1/17 | 36.77 | Joint liability guarantee | 2020/1/17-2021/1/20 | No | No |
| S.F. EXPRESS CORPORATION | 2019/3/16 | 1,000.00 | 2020/1/9 | 56.65 | Joint liability guarantee | 2020/1/9-2020/12/31 | No | No |
| S.F. EXPRESS (CHINA) LIMITED | 2019/3/16 | 4,000.00 | 2020/1/8 | 91.36 | Joint liability guarantee | 2020/1/8-2021/1/14 | No | No |
| Anhui S.F. Express Co., Ltd. | 2019/3/16 | 1,000.00 | 2020/1/3 | 59.72 | Joint liability guarantee | 2020/1/3-2020/5/31 | Yes | No |
| Beijing S.F. Express Co., LTD. | 2019/3/16 | 1,500.00 | 2020/1/17 | 35.00 | Joint liability guarantee | 2020/1/17-2020/12/20 | No | No |
| Beijing S.F. Express Co., LTD. | 2019/3/16 | 1,500.00 | 2020/1/16 | 73.09 | Joint liability guarantee | 2020/1/16-2020/12/31 | No | No |
| NINGBO SHUNFENG EXPRESS CO.,LTD. | 2019/3/16 | 2,500.00 | 2020/1/16 | 9.55 | Joint liability guarantee | 2020/1/16-2020/11/20 | No | No |
| Yunnan S.F. Express Co., Ltd. | 2019/3/16 | 600.00 | 2020/1/19 | 24.00 | Joint liability guarantee | 2020/1/19-2020/12/31 | No | No |
| Jiangxi Shunlu Logistics Co.,Ltd. | 2019/3/16 | 200.00 | 2020/1/3 | 88.00 | Joint liability guarantee | 2020/1/3-2020/8/31 | No | No |
| NINGBO SHUNFENG EXPRESS CO.,LTD. | 2019/3/16 | 2,500.00 | 2020/1/7 | 41.92 | Joint liability guarantee | 2020/1/7-2020/12/31 | No | No |
| Hubei S.F. Express Co., Ltd. | 2019/3/16 | 1,000.00 | 2020/1/19 | 55.33 | Joint liability guarantee | 2020/1/19-2020/5/31 | Yes | No |
| Liaoning Shunlu Logistics Co., Ltd. | 2019/3/16 | 1,600.00 | 2020/1/19 | 18.95 | Joint liability guarantee | 2020/1/19-2020/2/29 | Yes | No |
| Shanghai Shunheng Logistics Co., Ltd. | 2019/3/16 | 400.00 | 2020/1/19 | 58.44 | Joint liability guarantee | 2020/1/19-2021/1/10 | No | No |
| SF Express ChongQing CO.LTD | 2019/3/16 | 1,400.00 | 2020/1/19 | 110.00 | Joint liability guarantee | 2020/1/19-2020/12/31 | No | No |
| XI`AN S.F EXPRESS CO.,LTD | 2019/3/16 | 600.00 | 2020/1/19 | 1.33 | Joint liability guarantee | 2020/1/19-2020/11/30 | No | No |
| Xinjiang SF Express Co.,LTD. | 2019/3/16 | 100.00 | 2020/1/19 | 2.00 | Joint liability guarantee | 2020/1/19-2021/1/17 | No | No |
| Ezhou Shunlu Logistics Co., Ltd. | 2019/3/16 | 154,000.00 | 2020/1/20 | 10.00 | Joint liability guarantee | 2020/1/20-2020/12/31 | No | No |
| Jiangsu S.F. Express Co., Ltd. | 2019/3/16 | 300.00 | 2020/1/20 | 67.36 | Joint liability guarantee | 2020/1/20-2021/1/10 | No | No |
| QINGDAO S.F.EXPRESS CO.,LTD. | 2019/3/16 | 800.00 | 2020/1/10 | 50.00 | Joint liability guarantee | 2020/1/10-2020/12/31 | No | No |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Subsidiary’s guarantees to subsidiaries | ||||||||
| Guaranteed party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed? | Guarantee for a related party? |
| Quanzhou Shunlu Logistics Co., Ltd. | 2019/3/16 | 800.00 | 2020/1/17 | 300.00 | Joint liability guarantee | 2020/1/17-2020/12/31 | No | No |
| Quanzhou Shunlu Logistics Co., Ltd. | 2019/3/16 | 800.00 | 2020/1/17 | 300.00 | Joint liability guarantee | 2020/1/17-2020/12/31 | No | No |
| Shandong S.F. Express Co., Ltd. | 2019/3/16 | 1,000.00 | 2020/1/15 | 101.91 | Joint liability guarantee | 2020/1/15-2020/11/30 | No | No |
| Shenzhen Shuncheng Supply Chain Service Co., Ltd. | 2019/3/16 | 2,000.00 | 2020/1/17 | 5.23 | Joint liability guarantee | 2020/1/17-2021/2/28 | No | No |
| Shenzhen S.F. Supply Chain Co., Ltd. | 2019/3/16 | 11,900.00 | 2020/1/10 | 120.13 | Joint liability guarantee | 2020/1/10-2021/2/28 | No | No |
| Shenzhen SF Comprehensive Logistics Service Co., Ltd. | 2019/3/16 | 2,500.00 | 2020/1/3 | 1,870.00 | Joint liability guarantee | 2020/1/3-2020/12/31 | No | No |
| Shenzhen Shunlu Air Freight Forwarding Co., Ltd. | 2019/3/16 | 7,500.00 | 2020/1/10 | 1,850.00 | Joint liability guarantee | 2020/1/10-2020/12/31 | No | No |
| S.F. Express Co., Ltd. | 2019/3/16 | 25,000.00 | 2020/1/13 | 140.46 | Joint liability guarantee | 2020/1/13-2020/12/31 | No | No |
| S.F. Express Co., Ltd. | 2019/3/16 | 25,000.00 | 2020/1/13 | 233.15 | Joint liability guarantee | 2020/1/13-2020/12/31 | No | No |
| TIANJIN S.F. EXPRESS CO., LTD. | 2019/3/16 | 800.00 | 2020/1/17 | 80.90 | Joint liability guarantee | 2020/1/17-2021/12/31 | No | No |
| Wenzhou Shunheng Express Co., Ltd. | 2019/3/16 | 200.00 | 2020/1/17 | 110.00 | Joint liability guarantee | 2020/1/17-2021/1/10 | No | No |
| SF Airlines Company Limited | 2019/3/16 | 26,000.00 | 2020/1/23 | 25.49 | Joint liability guarantee | 2020/1/23-2020/6/29 | Yes | No |
| Guangxi ShunFeng Express Co.,Ltd. | 2019/3/16 | 200.00 | 2020/2/19 | 10.00 | Joint liability guarantee | 2020/2/19-2020/12/31 | No | No |
| Guangxi ShunFeng Express Co.,Ltd. | 2019/3/16 | 200.00 | 2020/2/19 | 100.00 | Joint liability guarantee | 2020/2/19-2021/1/31 | No | No |
| Guizhou S.F. Express Co., Ltd. | 2019/3/16 | 200.00 | 2020/2/19 | 12.74 | Joint liability guarantee | 2020/2/19-2021/2/28 | No | No |
| Jiangxi Shunlu Logistics Co.,Ltd. | 2019/3/16 | 200.00 | 2020/2/19 | 88.00 | Joint liability guarantee | 2020/2/19-2020/8/31 | No | No |
| Shandong S.F. Express Co., Ltd. | 2019/3/16 | 1,000.00 | 2020/2/24 | 5.00 | Joint liability guarantee | 2020/2/24-2020/11/30 | No | No |
| SF Airlines Company Limited | 2019/3/16 | 26,000.00 | 2020/2/24 | 2.00 | Joint liability guarantee | 2020/2/24-2021/2/21 | No | No |
| SF Airlines Company Limited | 2019/3/16 | 26,000.00 | 2020/2/24 | 22.03 | Joint liability guarantee | 2020/2/24-2021/3/6 | No | No |
| S. F. Express (Shenyang) Co., Ltd | 2019/3/16 | 600.00 | 2020/2/26 | 6.00 | Joint liability guarantee | 2020/2/26-2020/5/31 | Yes | No |
| S.F.EXPRESS (TIANJIN) CO., LTD. | 2019/3/16 | 300.00 | 2020/2/24 | 61.35 | Joint liability guarantee | 2020/2/24-2020/11/30 | No | No |
| Yantai S.F. Express Co., Ltd. | 2019/3/16 | 200.00 | 2020/2/24 | 65.00 | Joint liability guarantee | 2020/2/24-2021/1/31 | No | No |
| Zhanjiang S.F. Express Co., Ltd. | 2019/3/16 | 50.00 | 2020/2/19 | 25.00 | Joint liability guarantee | 2020/2/19-2021/8/5 | No | No |
| Chongqing Huiyifeng Logistics Co., Ltd. | 2019/3/16 | 2,800.00 | 2020/2/14 | 1,500.00 | Joint liability guarantee | 2020/2/14-2021/1/21 | No | No |
| Guang Zhou S.F. Express Co., Ltd. | 2019/3/16 | 4,000.00 | 2020/3/4 | 1,000.00 | Joint liability guarantee | 2020/3/4-2020/8/8 | No | No |
| SF Airlines Company Limited | 2019/3/16 | 26,000.00 | 2020/3/3 | 16.64 | Joint liability guarantee | 2020/3/3-2021/2/24 | No | No |
| Shenzhen S.F. Supply Chain Co., Ltd. | 2019/3/16 | 11,900.00 | 2020/3/5 | 600.00 | Joint liability guarantee | 2020/3/5-2021/2/28 | No | No |
| Shenzhen SF Comprehensive Logistics Service Co., Ltd. | 2019/3/16 | 2,500.00 | 2020/3/5 | 100.00 | Joint liability guarantee | 2020/3/5-2021/1/31 | No | No |
| Suzhou Industrial Park S.F. Express Co., Ltd. | 2019/3/16 | 1,900.00 | 2020/3/5 | 50.00 | Joint liability guarantee | 2020/3/5-2021/2/28 | No | No |
| Shanxi S.F. Express Co., Ltd. | 2019/3/16 | 200.00 | 2020/3/12 | 6.00 | Joint liability guarantee | 2020/3/12-2020/12/31 | No | No |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Subsidiary’s guarantees to subsidiaries | ||||||||
| Guaranteed party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed? | Guarantee for a related party? |
| Shanxi S.F. Express Co., Ltd. | 2019/3/16 | 200.00 | 2020/3/12 | 35.00 | Joint liability guarantee | 2020/3/12-2020/12/31 | No | No |
| Shenzhen SF Comprehensive Logistics Service Co., Ltd. | 2019/3/16 | 2,500.00 | 2020/3/16 | 250.00 | Joint liability guarantee | 2020/3/16-2020/12/31 | No | No |
| Foshan S.F. Express Co., Ltd. | 2019/3/16 | 500.00 | 2020/3/16 | 76.99 | Joint liability guarantee | 2020/3/16-2020/10/15 | No | No |
| Jiangsu S.F. Express Co., Ltd. | 2019/3/16 | 300.00 | 2020/3/16 | 10.30 | Joint liability guarantee | 2020/3/16-2020/3/7 | Yes | No |
| Shenzhen Shunlu Logistics Co., Ltd. | 2019/3/16 | 2,100.00 | 2020/3/16 | 100.00 | Joint liability guarantee | 2020/3/16-2021/4/15 | No | No |
| Shenzhen Shunlu Logistics Co., Ltd. | 2019/3/16 | 2,100.00 | 2020/3/16 | 80.00 | Joint liability guarantee | 2020/3/16-2021/6/30 | No | No |
| S. F. Express (Shenyang) Co., Ltd | 2019/3/16 | 600.00 | 2020/3/16 | 45.37 | Joint liability guarantee | 2020/3/16-2021/3/9 | No | No |
| Beijing S.F. Express Co., LTD. | 2019/3/16 | 1,500.00 | 2020/3/16 | 100.00 | Joint liability guarantee | 2020/3/16-2021/4/20 | No | No |
| DHL LOGISTICS(CHINA) CO.,LTD. | 2019/3/16 | 5,900.00 | 2020/3/19 | 20.00 | Joint liability guarantee | 2020/3/19-2021/3/31 | No | No |
| S.F. Express Co., Ltd. | 2019/3/16 | 25,000.00 | 2020/3/3 | 500.00 | Joint liability guarantee | 2020/3/3-2021/3/1 | No | No |
| Shenzhen SF Comprehensive Logistics Service Co., Ltd. | 2019/3/16 | 2,500.00 | 2020/3/16 | 150.00 | Joint liability guarantee | 2020/3/16-2020/8/31 | No | No |
| S.F. EXPRESS (CHINA) LIMITED | 2019/3/16 | 4,000.00 | 2020/3/18 | 27.41 | Joint liability guarantee | 2020/3/18-2020/11/30 | No | No |
| E COMMERCE FULFILLMENT COMPANY LIMITED | 2019/3/16 | 7,060.00 | 2020/3/5 | 23.44 | Joint liability guarantee | 2020/3/5-2020/11/11 | No | No |
| S.F. EXPRESS (CHINA) LIMITED | 2019/3/16 | 4,000.00 | 2020/3/19 | 54.82 | Joint liability guarantee | 2020/3/19-2021/3/31 | No | No |
| Chengdu Shunyifeng Pharmaceutical Co., Ltd. | 2019/3/16 | 100.00 | 2020/3/20 | 43.63 | Joint liability guarantee | 2020/3/20-2021/3/12 | No | No |
| ZHONGSHAN S.F. EXPRESS CO. LTD | 2019/3/16 | 200.00 | 2020/3/26 | 141.98 | Joint liability guarantee | 2020/3/26-2020/12/15 | No | No |
| Zhejiang Shunlu Logistics Co.,Ltd. | 2019/3/16 | 5,000.00 | 2020/3/30 | 350.00 | Joint liability guarantee | 2020/3/30-2021/3/12 | No | No |
| Xi'an Shunlu Logistics Co., Ltd. | 2019/3/16 | 1,300.00 | 2020/3/30 | 230.90 | Joint liability guarantee | 2020/3/30-2021/3/27 | No | No |
| Sichuan S.F. Express Co., Ltd. | 2019/3/16 | 500.00 | 2020/3/26 | 5.00 | Joint liability guarantee | 2020/3/26-2021/1/31 | No | No |
| S.F. Express Co., Ltd. | 2019/3/16 | 25,000.00 | 2020/3/23 | 3,000.00 | Joint liability guarantee | 2020/3/23-2021/3/11 | No | No |
| S.F. Express (Huizhou) Co., Ltd. | 2019/3/16 | 450.00 | 2020/3/23 | 19.57 | Joint liability guarantee | 2020/3/23-2021/6/30 | No | No |
| SF Airlines Company Limited | 2019/3/16 | 26,000.00 | 2020/3/20 | 106.22 | Joint liability guarantee | 2020/3/20-2020/12/31 | No | No |
| SF Airlines Company Limited | 2019/3/16 | 26,000.00 | 2020/3/23 | 57.77 | Joint liability guarantee | 2020/3/23-2021/3/12 | No | No |
| Shenzhen Shuncheng Supply Chain Service Co., Ltd. | 2019/3/16 | 2,000.00 | 2020/3/23 | 22.84 | Joint liability guarantee | 2020/3/23-2021/2/28 | No | No |
| S.F. EXPRESS (HONG KONG) LIMITED | 2019/3/16 | 13,200.00 | 2020/3/25 | 70.81 | Joint liability guarantee | 2020/3/25-2021/5/26 | No | No |
| Jiangsu S.F. Express Co., Ltd. | 2019/3/16 | 300.00 | 2020/3/23 | 5.00 | Joint liability guarantee | 2020/3/23-2020/4/30 | Yes | No |
| SF-Express(Ningxia)Co.,Ltd | 2019/3/16 | 200.00 | 2020/3/31 | 100.00 | Joint liability guarantee | 2020/3/31-2021/1/31 | No | No |
| EXEL LOGISTICS CHINA CO.,LTD. | 2019/3/16 | 2,700.00 | 2020/4/3 | 173.39 | Joint liability guarantee | 2020/4/3-2022/7/31 | No | No |
| EXEL LOGISTICS CHINA CO.,LTD. | 2019/3/16 | 2,700.00 | 2020/4/3 | 328.86 | Joint liability guarantee | 2020/4/3-2022/7/31 | No | No |
| EXEL LOGISTICS CHINA CO.,LTD. | 2019/3/16 | 2,700.00 | 2020/4/3 | 500.00 | Joint liability guarantee | 2020/4/3-2023/4/3 | No | No |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Subsidiary’s guarantees to subsidiaries | ||||||||
| Guaranteed party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed? | Guarantee for a related party? |
| DHL Logistics (Beijing) Co., Ltd. | 2019/3/16 | 5,100.00 | 2020/4/3 | 50.00 | Joint liability guarantee | 2020/4/3-2020/12/31 | No | No |
| XI`AN S.F EXPRESS CO.,LTD | 2019/3/16 | 600.00 | 2020/4/10 | 56.87 | Joint liability guarantee | 2020/4/10-2021/3/19 | No | No |
| Suzhou Industrial Park S.F. Express Co., Ltd. | 2019/3/16 | 1,900.00 | 2020/4/15 | 28.39 | Joint liability guarantee | 2020/4/15-2021/6/30 | No | No |
| DHL Logistics (Beijing) Co., Ltd. | 2020/3/24 | 2,000.00 | 2020/4/28 | 70.35 | Joint liability guarantee | 2020/4/28-2022/9/30 | No | No |
| S.F. EXPRESS (AUSTRALIA) PTY LTD | 2020/3/24 | 1,500.00 | 2020/4/21 | 18.18 | Joint liability guarantee | 2020/4/21-2021/3/31 | No | No |
| Anhui S.F. Express Co., Ltd. | 2020/3/24 | 1,200.00 | 2020/4/29 | 10.00 | Joint liability guarantee | 2020/4/29-2021/4/21 | No | No |
| Chengdu Shunyifeng Pharmaceutical Co., Ltd. | 2020/3/24 | 100.00 | 2020/4/23 | 20.00 | Joint liability guarantee | 2020/4/23-2020/12/31 | No | No |
| Chengdu Taishun Logistics Co.,Ltd. | 2020/3/24 | 2,000.00 | 2020/4/28 | 100.00 | Joint liability guarantee | 2020/4/28-2021/1/31 | No | No |
| FS ELECTRONIC TECHNOLOGY CO., LIMITED | 2020/3/24 | 1,000.00 | 2020/4/16 | 316.13 | Joint liability guarantee | 2020/4/16-2021/7/31 | No | No |
| Guangxi ShunFeng Express Co.,Ltd. | 2020/3/24 | 300.00 | 2020/4/16 | 70.00 | Joint liability guarantee | 2020/4/16-2020/12/31 | No | No |
| Guizhou S.F. Express Co., Ltd. | 2020/3/24 | 300.00 | 2020/4/29 | 64.96 | Joint liability guarantee | 2020/4/29-2021/4/21 | No | No |
| Hebei S.F. Express Co., Ltd. | 2020/3/24 | 400.00 | 2020/4/16 | 12.68 | Joint liability guarantee | 2020/4/16-2021/4/10 | No | No |
| Hubei S.F. Transportation Co., Ltd. | 2020/3/24 | 700.00 | 2020/4/28 | 323.29 | Joint liability guarantee | 2020/4/28-2021/4/15 | No | No |
| Jiangxi S.F. Express Co., Ltd. | 2020/3/24 | 1,000.00 | 2020/4/16 | 223.43 | Joint liability guarantee | 2020/4/16-2021/4/10 | No | No |
| NINGBO SHUNFENG EXPRESS CO.,LTD. | 2020/3/24 | 3,000.00 | 2020/4/16 | 550.00 | Joint liability guarantee | 2020/4/16-2021/5/7 | No | No |
| QINGDAO S.F.EXPRESS CO.,LTD. | 2020/3/24 | 800.00 | 2020/4/16 | 260.00 | Joint liability guarantee | 2020/4/16-2020/11/30 | No | No |
| Shandong S.F. Express Co., Ltd. | 2020/3/24 | 1,500.00 | 2020/4/16 | 30.00 | Joint liability guarantee | 2020/4/16-2021/1/31 | No | No |
| Shandong S.F. Express Co., Ltd. | 2020/3/24 | 1,500.00 | 2020/4/29 | 309.71 | Joint liability guarantee | 2020/4/29-2021/4/21 | No | No |
| Shanghai Shunheng Logistics Co., Ltd. | 2020/3/24 | 3,000.00 | 2020/4/26 | 107.41 | Joint liability guarantee | 2020/4/26-2021/4/15 | No | No |
| Shenzhen SF Fix Technology Co., Ltd. | 2020/3/24 | 10,000.00 | 2020/4/23 | 400.00 | Joint liability guarantee | 2020/4/23-2021/1/31 | No | No |
| Shenzhen Fengyi Technology Co., Ltd. | 2020/3/24 | 10,000.00 | 2020/4/29 | 500.00 | Joint liability guarantee | 2020/4/29-2021/4/26 | No | No |
| Shenzhen S.F. Supply Chain Co., Ltd. | 2020/3/24 | 10,000.00 | 2020/4/16 | 230.00 | Joint liability guarantee | 2020/4/16-2021/4/30 | No | No |
| Shenzhen S.F. Supply Chain Co., Ltd. | 2020/3/24 | 10,000.00 | 2020/4/29 | 500.00 | Joint liability guarantee | 2020/4/29-2021/3/27 | No | No |
| Shenzhen S.F. Supply Chain Co., Ltd. | 2020/3/24 | 10,000.00 | 2020/4/29 | 1,000.00 | Joint liability guarantee | 2020/4/29-2020/7/30 | No | No |
| Shenzhen S.F. Supply Chain Co., Ltd. | 2020/3/24 | 10,000.00 | 2020/4/29 | 500.00 | Joint liability guarantee | 2020/4/29-2021/5/5 | No | No |
| Shenzhen S.F. Supply Chain Co., Ltd. | 2020/3/24 | 10,000.00 | 2020/4/23 | 60.00 | Joint liability guarantee | 2020/4/23-2021/4/14 | No | No |
| SF Airlines Company Limited | 2020/3/24 | 20,000.00 | 2020/4/16 | 2,000.00 | Joint liability guarantee | 2020/4/16-2021/4/15 | No | No |
| SF Airlines Company Limited | 2020/3/24 | 20,000.00 | 2020/4/27 | 39.63 | Joint liability guarantee | 2020/4/27-2020/8/31 | No | No |
| S.F.Express(Dong Guan)Limited | 2020/3/24 | 3,000.00 | 2020/4/29 | 15.03 | Joint liability guarantee | 2020/4/29-2021/4/24 | No | No |
| S.F.EXPRESS (TIANJIN) CO., LTD. | 2020/3/24 | 300.00 | 2020/4/23 | 52.91 | Joint liability guarantee | 2020/4/23-2020/10/26 | No | No |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Subsidiary’s guarantees to subsidiaries | ||||||||
| Guaranteed party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed? | Guarantee for a related party? |
| S.F. Express Group (Shanghai) Co., Ltd. | 2020/3/24 | 1,200.00 | 2020/4/28 | 100.00 | Joint liability guarantee | 2020/4/28-2021/5/4 | No | No |
| SF Express ChongQing CO.LTD | 2020/3/24 | 1,000.00 | 2020/4/26 | 169.01 | Joint liability guarantee | 2020/4/26-2021/4/15 | No | No |
| SF Pharmaceutical Supply Chain Hubei Co., Ltd. | 2020/3/24 | 100.00 | 2020/4/23 | 5.00 | Joint liability guarantee | 2020/4/23-2021/3/31 | No | No |
| Sichuan S.F. Express Co., Ltd. | 2020/3/24 | 500.00 | 2020/4/27 | 11.61 | Joint liability guarantee | 2020/4/27-2021/4/21 | No | No |
| Sichuan S.F. Express Co., Ltd. | 2020/3/24 | 500.00 | 2020/4/23 | 56.69 | Joint liability guarantee | 2020/4/23-2020/8/31 | No | No |
| Suzhou Industrial Park S.F. Express Co., Ltd. | 2020/3/24 | 1,500.00 | 2020/4/16 | 20.00 | Joint liability guarantee | 2020/4/16-2021/4/7 | No | No |
| Xinjiang SF Express Co.,LTD. | 2020/3/24 | 210.00 | 2020/4/16 | 6.00 | Joint liability guarantee | 2020/4/16-2020/12/31 | No | No |
| Zhejiang Shunhefeng Freight Co., Ltd. | 2020/3/24 | 700.00 | 2020/4/29 | 10.00 | Joint liability guarantee | 2020/4/29-2021/4/21 | No | No |
| Zhejiang Shunlu Logistics Co.,Ltd. | 2020/3/24 | 3,000.00 | 2020/4/28 | 749.32 | Joint liability guarantee | 2020/4/28-2021/4/21 | No | No |
| S.F. Transportation (Changzhou) Co., Ltd. | 2020/3/24 | 200.00 | 2020/4/30 | 74.85 | Joint liability guarantee | 2020/4/30-2021/4/21 | No | No |
| Jiangsu Shunhefeng Freight Co., Ltd. | 2020/3/24 | 1,200.00 | 2020/5/26 | 18.02 | Joint liability guarantee | 2020/5/26-2021/4/30 | No | No |
| DHL LOGISTICS(CHINA) CO.,LTD. | 2020/3/24 | 4,000.00 | 2020/5/19 | 1,086.87 | Joint liability guarantee | 2020/5/19-2022/12/14 | No | No |
| Jiangsu Shunhefeng Freight Co., Ltd. | 2020/3/24 | 1,200.00 | 2020/5/29 | 692.81 | Joint liability guarantee | 2020/5/29-2021/4/30 | No | No |
| DHL Logistics (Beijing) Co., Ltd. | 2020/3/24 | 2,000.00 | 2020/5/18 | 58.86 | Joint liability guarantee | 2020/5/18-2022/7/31 | No | No |
| DHL Logistics (Beijing) Co., Ltd. | 2020/3/24 | 2,000.00 | 2020/5/18 | 237.86 | Joint liability guarantee | 2020/5/18-2022/7/31 | No | No |
| Shaanxi SF Freight Co., Ltd. | 2020/3/24 | 400.00 | 2020/5/13 | 59.55 | Joint liability guarantee | 2020/5/13-2021/7/31 | No | No |
| S.F. EXPRESS (CHINA) LIMITED | 2020/3/24 | 2,000.00 | 2020/5/27 | 91.36 | Joint liability guarantee | 2020/5/27-2021/2/28 | No | No |
| Shandong S.F. Express Co., Ltd. | 2020/3/24 | 1,500.00 | 2020/5/28 | 31.58 | Joint liability guarantee | 2020/5/28-2021/5/25 | No | No |
| Shandong S.F. Express Co., Ltd. | 2020/3/24 | 1,500.00 | 2020/5/27 | 94.74 | Joint liability guarantee | 2020/5/27-2021/2/28 | No | No |
| Beijing S.F. Express Co., LTD. | 2020/3/24 | 1,500.00 | 2020/5/27 | 250.00 | Joint liability guarantee | 2020/5/27-2021/2/28 | No | No |
| Chengdu Taishun Logistics Co.,Ltd. | 2020/3/24 | 2,000.00 | 2020/5/27 | 900.00 | Joint liability guarantee | 2020/5/27-2021/2/28 | No | No |
| Guizhou S.F. Express Co., Ltd. | 2020/3/24 | 300.00 | 2020/5/27 | 12.28 | Joint liability guarantee | 2020/5/27-2021/2/28 | No | No |
| Hangzhou Zhentai Asset Management Co., Ltd. | 2020/3/24 | 3,500.00 | 2020/5/27 | 226.60 | Joint liability guarantee | 2020/5/27-2021/2/28 | No | No |
| Hangzhou Zhentai Asset Management Co., Ltd. | 2020/3/24 | 3,500.00 | 2020/5/27 | 290.10 | Joint liability guarantee | 2020/5/27-2021/2/28 | No | No |
| Hangzhou Zhentai Asset Management Co., Ltd. | 2020/3/24 | 3,500.00 | 2020/5/27 | 183.20 | Joint liability guarantee | 2020/5/27-2021/2/28 | No | No |
| Hangzhou Zhentai Asset Management Co., Ltd. | 2020/3/24 | 3,500.00 | 2020/5/27 | 183.20 | Joint liability guarantee | 2020/5/27-2021/2/28 | No | No |
| Hebei S.F. Express Co., Ltd. | 2020/3/24 | 400.00 | 2020/5/27 | 30.00 | Joint liability guarantee | 2020/5/27-2021/2/28 | No | No |
| Hebei S.F. Express Co., Ltd. | 2020/3/24 | 400.00 | 2020/5/27 | 90.00 | Joint liability guarantee | 2020/5/27-2021/2/28 | No | No |
| Jiangsu S.F. Express Co., Ltd. | 2020/3/24 | 450.00 | 2020/5/27 | 60.35 | Joint liability guarantee | 2020/5/27-2021/2/28 | No | No |
| Shenzhen SF Comprehensive Logistics Service Co., Ltd. | 2020/3/24 | 5,500.00 | 2020/5/27 | 75.00 | Joint liability guarantee | 2020/5/27-2021/2/28 | No | No |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Subsidiary’s guarantees to subsidiaries | ||||||||
| Guaranteed party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed? | Guarantee for a related party? |
| Shenzhen Shunlu Logistics Co., Ltd. | 2020/3/24 | 2,000.00 | 2020/5/27 | 391.19 | Joint liability guarantee | 2020/5/27-2021/2/28 | No | No |
| SF Pharmaceutical Supply Chain Hubei Co., Ltd. | 2020/3/24 | 100.00 | 2020/5/27 | 10.00 | Joint liability guarantee | 2020/5/27-2021/2/28 | No | No |
| Liaoning Shunlu Logistics Co., Ltd. | 2020/3/24 | 1,000.00 | 2020/5/27 | 191.30 | Joint liability guarantee | 2020/5/27-2021/2/28 | No | No |
| Shenzhen Fengyi Technology Co., Ltd. | 2020/3/24 | 10,000.00 | 2020/6/10 | 1,825.00 | Joint liability guarantee | 2020/6/10-2021/2/28 | No | No |
| EXEL LOGISTICS CHINA CO.,LTD. | 2020/3/24 | 700.00 | 2020/6/10 | 169.71 | Joint liability guarantee | 2020/6/10-2021/3/31 | No | No |
| DHL Logistics (Beijing) Co., Ltd. | 2020/3/24 | 2,000.00 | 2020/6/10 | 40.00 | Joint liability guarantee | 2020/6/10-2020/12/31 | No | No |
| DHL Logistics (Beijing) Co., Ltd. | 2020/3/24 | 2,000.00 | 2020/6/10 | 519.61 | Joint liability guarantee | 2020/6/10-2021/12/31 | No | No |
| DHL Logistics (Beijing) Co., Ltd. | 2020/3/24 | 2,000.00 | 2020/6/10 | 116.56 | Joint liability guarantee | 2020/6/10-2021/12/31 | No | No |
| DHL Logistics (Beijing) Co., Ltd. | 2020/3/24 | 2,000.00 | 2020/6/11 | 24.85 | Joint liability guarantee | 2020/6/11-2022/7/31 | No | No |
| Shenzhen SF Fix Technology Co., Ltd. | 2020/3/24 | 10,000.00 | 2020/6/29 | 1,600.00 | Joint liability guarantee | 2020/6/29-2020/12/31 | No | No |
| S.F. EXPRESS (HONG KONG) LIMITED | 2020/3/24 | 10,000.00 | 2020/6/18 | 3,468.22 | Joint liability guarantee | 2020/6/18-2020/9/19 | No | No |
| Anhui S.F. Express Co., Ltd. | 2020/3/24 | 1,200.00 | 2020/6/15 | 100.00 | Joint liability guarantee | 2020/6/15-2020/7/31 | No | No |
| Anhui S.F. Express Co., Ltd. | 2020/3/24 | 1,200.00 | 2020/6/29 | 180.00 | Joint liability guarantee | 2020/6/29-2021/5/31 | No | No |
| Anhui S.F. Express Co., Ltd. | 2020/3/24 | 1,200.00 | 2020/6/8 | 59.72 | Joint liability guarantee | 2020/6/8-2021/5/31 | No | No |
| Anhui S.F. Express Co., Ltd. | 2020/3/24 | 1,200.00 | 2020/6/29 | 99.37 | Joint liability guarantee | 2020/6/29-2021/6/30 | No | No |
| S.F.EXPRESS OF DALIAN L.T.D | 2020/3/24 | 200.00 | 2020/6/1 | 42.48 | Joint liability guarantee | 2020/6/1-2020/8/31 | No | No |
| Guizhou S.F. Express Co., Ltd. | 2020/3/24 | 300.00 | 2020/6/1 | 11.38 | Joint liability guarantee | 2020/6/1-2021/4/30 | No | No |
| HaiNan S.F.Express LTD. | 2020/3/24 | 500.00 | 2020/6/29 | 35.00 | Joint liability guarantee | 2020/6/29-2021/1/31 | No | No |
| Hangzhou SF Zhida Logistics Co., Ltd. | 2020/3/24 | 550.00 | 2020/6/1 | 256.59 | Joint liability guarantee | 2020/6/1-2021/5/19 | No | No |
| Hubei S.F. Express Co., Ltd. | 2020/3/24 | 1,000.00 | 2020/6/1 | 24.93 | Joint liability guarantee | 2020/6/1-2021/7/30 | No | No |
| Hubei S.F. Express Co., Ltd. | 2020/3/24 | 1,000.00 | 2020/6/1 | 80.00 | Joint liability guarantee | 2020/6/1-2021/5/31 | No | No |
| Jiangsu S.F. Express Co., Ltd. | 2020/3/24 | 450.00 | 2020/6/17 | 3.00 | Joint liability guarantee | 2020/6/17-2021/6/14 | No | No |
| Jiangsu S.F. Express Co., Ltd. | 2020/3/24 | 450.00 | 2020/6/1 | 82.33 | Joint liability guarantee | 2020/6/1-2021/5/31 | No | No |
| Jinhua S.F. Express Co., Ltd. | 2020/3/24 | 200.00 | 2020/6/1 | 5.00 | Joint liability guarantee | 2020/6/1-2021/4/30 | No | No |
| Liaoning Shunhe Supply Chain Management Co., Ltd. | 2020/3/24 | 500.00 | 2020/6/1 | 7.00 | Joint liability guarantee | 2020/6/1-2021/4/30 | No | No |
| Nantong S.F. Express Co., Ltd. | 2020/3/24 | 100.00 | 2020/6/1 | 12.27 | Joint liability guarantee | 2020/6/1-2021/5/18 | No | No |
| QINGDAO S.F.EXPRESS CO.,LTD. | 2020/3/24 | 800.00 | 2020/6/12 | 3.00 | Joint liability guarantee | 2020/6/12-2020/12/31 | No | No |
| Shandong S.F. Express Co., Ltd. | 2020/3/24 | 1,500.00 | 2020/6/1 | 150.00 | Joint liability guarantee | 2020/6/1-2021/5/31 | No | No |
| Shandong S.F. Express Co., Ltd. | 2020/3/24 | 1,500.00 | 2020/6/1 | 2.00 | Joint liability guarantee | 2020/6/1-2021/5/14 | No | No |
| Zhejiang Shuangjie Supply Chain Technology Co., Ltd. | 2020/3/24 | 1,600.00 | 2020/6/10 | 30.40 | Joint liability guarantee | 2020/6/10-2021/5/25 | No | No |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Subsidiary’s guarantees to subsidiaries | ||||||||
| Guaranteed party | Disclosure date of Quota announcement | Amount of guaranteed Quota approved | Actual date of occurrence | Actual guarantee amount | Type of guarantee | Period of guarantee | Executed? | Guarantee for a related party? |
| Shanghai Shuncheng Logistics Co., Ltd. | 2020/3/24 | 1,500.00 | 2020/6/12 | 400.00 | Joint liability guarantee | 2020/6/12-2021/9/30 | No | No |
| Shenzhen Shuncheng Supply Chain Service Co., Ltd. | 2020/3/24 | 200.00 | 2020/6/10 | 14.54 | Joint liability guarantee | 2020/6/10-2021/5/31 | No | No |
| Shenzhen Shuncheng Supply Chain Service Co., Ltd. | 2020/3/24 | 200.00 | 2020/6/30 | 23.00 | Joint liability guarantee | 2020/6/30-2021/5/31 | No | No |
| SF Airlines Company Limited | 2020/3/24 | 20,000.00 | 2020/6/24 | 1,200.00 | Joint liability guarantee | 2020/6/24-2021/5/13 | No | No |
| SF Airlines Company Limited | 2020/3/24 | 20,000.00 | 2020/5/22 | 9.43 | Joint liability guarantee | 2020/5/22-2021/4/30 | No | No |
| SF Airlines Company Limited | 2020/3/24 | 20,000.00 | 2020/6/22 | 106.22 | Joint liability guarantee | 2020/6/22-2021/3/31 | No | No |
| S.F. Express Co., Ltd. | 2020/3/24 | 17,300.00 | 2020/6/8 | 100.00 | Joint liability guarantee | 2020/6/8-2021/4/30 | No | No |
| Sichuan Shunhefeng Freight Co., Ltd. | 2020/3/24 | 300.00 | 2020/6/4 | 43.35 | Joint liability guarantee | 2020/6/4-2021/5/31 | No | No |
| Wuxi S.F. Express Co., Ltd. | 2020/3/24 | 500.00 | 2020/6/3 | 20.00 | Joint liability guarantee | 2020/6/3-2021/5/23 | No | No |
| Xinjiang SF Express Co.,LTD. | 2020/3/24 | 210.00 | 2020/6/29 | 104.78 | Joint liability guarantee | 2020/6/29-2021/6/19 | No | No |
| Zhaoqing S.F. Express Co., Ltd. | 2020/3/24 | 100.00 | 2020/6/10 | 16.20 | Joint liability guarantee | 2020/6/10-2021/6/5 | No | No |
| Zhejiang Shuangjie Supply Chain Technology Co., Ltd. | 2020/3/24 | 1,600.00 | 2020/6/11 | 21.65 | Joint liability guarantee | 2020/6/11-2021/11/30 | No | No |
| Zhejiang Shunlu Logistics Co.,Ltd. | 2020/3/24 | 3,000.00 | 2020/6/8 | 115.00 | Joint liability guarantee | 2020/6/8-2020/10/31 | No | No |
| Zhejiang Shunlu Logistics Co.,Ltd. | 2020/3/24 | 3,000.00 | 2020/6/8 | 40.00 | Joint liability guarantee | 2020/6/8-2021/5/28 | No | No |
| ZHONGSHAN S.F. EXPRESS CO. LTD | 2020/3/24 | 200.00 | 2020/6/15 | 20.72 | Joint liability guarantee | 2020/6/15-2020/12/15 | No | No |
| Anhui S.F. Express Co., Ltd. | 2020/3/24 | 1,200.00 | 2020/6/24 | 5.00 | Joint liability guarantee | 2020/6/24-2021/6/15 | No | No |
| Hubei S.F. Express Co., Ltd. | 2020/3/24 | 1,000.00 | 2020/6/24 | 1.00 | Joint liability guarantee | 2020/6/24-2021/6/19 | No | No |
| Shenzhen S.F. Supply Chain Co., Ltd. | 2020/3/24 | 10,000.00 | 2020/6/30 | 300.00 | Joint liability guarantee | 2020/6/30-2020/6/30 | Yes | No |
| Shenzhen SF Freight Co., Ltd. | 2020/3/24 | 2,000.00 | 2020/6/24 | 325.15 | Joint liability guarantee | 2020/6/24-2021/6/11 | No | No |
| SF Airlines Company Limited | 2020/3/24 | 20,000.00 | 2020/6/19 | 3.54 | Joint liability guarantee | 2020/6/19-2021/6/20 | No | No |
| SF Airlines Company Limited | 2020/3/24 | 20,000.00 | 2020/6/19 | 14.16 | Joint liability guarantee | 2020/6/19-2021/6/28 | No | No |
| TIANJIN S.F. EXPRESS CO., LTD. | 2020/3/24 | 700.00 | 2020/6/29 | 130.00 | Joint liability guarantee | 2020/6/29-2021/7/29 | No | No |
| Tibet S.F. Express Co., Ltd. | 2020/3/24 | 100.00 | 2020/6/24 | 5.00 | Joint liability guarantee | 2020/6/24-2021/3/31 | No | No |
| Zhejiang Shunlu Logistics Co.,Ltd. | 2020/3/24 | 3,000.00 | 2020/6/24 | 100.00 | Joint liability guarantee | 2020/6/24-2021/5/31 | No | No |
| Anhui Shunhe Freight Co., Ltd. | 2020/3/24 | 350.00 | 2020/6/24 | 45.17 | Joint liability guarantee | 2020/6/24-2021/6/9 | No | No |
| Liaoning Shunlu Logistics Co., Ltd. | 2020/3/24 | 1,000.00 | 2020/6/24 | 172.09 | Joint liability guarantee | 2020/6/24-2021/6/11 | No | No |
| S.F. EXPRESS (CHINA) LIMITED | 2020/3/24 | 2,000.00 | 2020/6/18 | 45.68 | Joint liability guarantee | 2020/6/18-2021/7/6 | No | No |
| EXEL LOGISTICS CHINA CO.,LTD. | 2019/3/16 | 2,700.00 | 2020/1/2 | 153.35 | Joint liability guarantee | 2020/1/2-2020/12/31 | No | No |
| Total guarantee quota approved for subsidiaries during the reporting period（C1） | 2,124,480.00 | Total actual amount of guarantees for subsidiaries during the reporting period（C2） | 54,331.86 | |||||
| Total guarantee quota approved for the subsidiaries at the end of the reporting period（C3） | 2,227,049.79 | Total actual guarantee balance for subsidiaries at the end of the reporting period （C4） | 138,287.24 | |||||
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Total guarantee amount provided by the Company | |||
| Total guarantee quota approved during the reporting period（A1+B1+C1） | 2,500,000.00 | Total actual amount of guarantee during the reporting period（A2+B2+C2） | 550,008.86 |
| Total guarantee quota approved at the end of the reporting period（A3+B3+C3） | 3,452,301.79 | Total actual guarantee balance at the end of the reporting period（A4+B4+C4） | 988,019.24 |
| Total guarantee amount (A4+B4+C4) to net assets of the Company | 21.09% | ||
| Of which: | |||
| Amount of guarantee for shareholders, actual controller, and their related parties (D) | |||
| Amount of debt guarantee provided for guaranteed party whose asset-liability ratio is not less than 70% directly or indirectly (E) | 50,488.72 | ||
| Amount of total guarantee over 50% of net assets (F) | - | ||
| Total amount of the above three guarantees (D+E+F) | 50,488.72 | ||
| Explanation of warranty liability or possible joint liquidation (if any) | N/A | ||
| Explanation of provision of guarantees for external parties in violation of the prescribed procedure (if any) | N/A | ||
Before Taisen Holding was incorporated into the listed Company in December 2016, Taisen Holding and its subsidiaries performedexternal guarantee procedures in accordance with their own Articles of Corporation and other relevant regulations. After TaisenHolding was incorporated into the listed Company in December 2016, as a subsidiary of the listed Company, Taisen Holding and itssubsidiaries strictly performed the review and disclosure procedures of external guarantees in accordance with relevant laws andregulations such as the Stock Listing Rules of Shenzhen Stock Exchange and other related laws and regulations.
(2) Illegal provision of guarantees for external parties
□Applicable √ Not applicable
No such cases in the reporting period.
3. Wealth managed under trust
√ Applicable □ Not applicable
Entrusted finances during the reporting period
Unit: RMB10 thousands
| Type | Funding Source for Entrusted Funds | Maximum Daily Balance of Such Entrusted Funds During the Reporting Period | Unexpired Balance | Overdue Outstanding Amount |
| Bank wealth management products | Self-owned fund | 1,497,000.00 | 1,478,500.00 | - |
| Bank wealth management products | Raised funds | 301,000.00 | 178,000.00 | - |
| Brokerage wealth management products | Raised funds | 115,000.00 | 102,000.00 | - |
| Total | – | 1,758,500.00 | - | |
Note: The maximum daily balances for different types of entrusted funds in the above table occur on differentdates, and the total amount does not represent the maximum daily balance of the Company’s total amount ofwealth management products.
Details of individual items with significant amount or of low safety, poor liquidity, or without principal guaranteehigh risk wealth management products
□ Applicable √ Not applicable
The entrusted financing is expected to fail to recover the principal, or there may be other circumstances that mayresult in impairment.
□ Applicable √ Not applicable
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
4. Other significant contracts
□Applicable √Not applicable
No such cases in the reporting period.
XVI. Social Responsibilities
1. Environmental protection
Did the listed Company and its subsidiaries belong to the major pollutant discharge units announced by theMinistry of Ecology and Environment?NoThe Company and its subsidiaries are not part of the major pollutant discharge units announced by the Ministry ofEcology and Environment.
2. Targeted Poverty Alleviation Program
□Applicable √ Not applicable
During the reporting period, the Company did not carry out any Targeted Poverty Alleviation Program.
XVII. Other Major Issues
√ Applicable □Not applicable
1. Issuance of debt financing products in domestic and international markets by wholly-owned subsidiariesIn order to satisfy the development requirements of domestic and international business, reduce financing costsand optimize the debt structure according to the development strategies of the Company, at the 18th meeting of the4th session of the Board and the 2019 first extraordinary general meeting convened by the Company on January 3,2019 and January 23, 2019 respectively, the “Resolution regarding the Issuance of Debt Financing Products inDomestic and International Markets by Wholly-owned Subsidiaries” was considered and approved, and theCompany was authorised to issue debt financing products in domestic and international markets through TaisenHolding and SF Holding Investment Limited (“SFHI”), the wholly-owned subsidiaries, for an equivalent amount ofno more than RMB16 billion (inclusive), including RMB10 billion which are the expected size of issuance indomestic market and RMB6 billion which are the expected size of issuance in international market.
On January 22, 2020, Taisen Holding received the Notice of Acceptance for Registration (Zhong Shi Xie Zhu[2020] MTN No.22) issued by the National Association of Financial Market Institutional Investors (“NAFMII”).The registration of Taisen Holding for medium-term notes was accepted by NAFMII, and the registered amount isRMB2 billion.
According to the Notice of Acceptance for Registration issued by NAFMII (Zhong Shi Xie Zhu [2019] SCPNo.71), Taisen Holding completed altogether four issuances of Super Short-Term Commercial Paper on February21, 2020, March 12, 2020, April 14, 2020, and May 7, 2020 respectively, each with an issuance quota of RMB500million.
According to the authorization by the resolution of the first extraordinary general meeting in 2019, on February 20,2020, SFHI completed the issuance of US$700 million bonds overseas. The bonds were listed on The StockExchange of Hong Kong Limited on February 21, 2020.For details, please refer to the Company’s announcements (2020-004, 2020-005, 2020-007, 2020-008, 2020-015,2020-036 and 2020-049) disclosed on Cninfo.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
2. Issuance of convertible bonds by the Company
In accordance with the Company’s development strategy, aiming at improving the Company’s competitiveness,further strengthening its core competitiveness, and enhancing its sustainable development capabilities, theCompany publicly issued 58 million convertible corporate bonds (bond abbreviation: SF Convertible Bonds; bondcode: 128080) on November 18, 2019, each with a face value of RMB100 amounting to RMB5.8 billion. Theseconvertible corporate bonds were listed for trading on the Shenzhen Stock Exchange starting from December 9,2019. On May 22, 2020, these convertible corporate bonds entered the conversion period. The closing price of theCompany’s stocks (stock abbreviation: SF Holding; stock code: 002352) was, for at least 15 out of the 30consecutive trading days from May 22, 2020 to July 6, 2020, not less than 130% of the current stock conversionprice of “SF Convertible Bonds” (the stock conversion price from May 22 to June 18 was RMB40.14 per share,and the stock conversion price from June 19 to July 6 was RMB40.15 per share) (that is, RMB52.19 per share andRMB52.20 per share, respectively), and the conditional redemption clause under the Prospectus had beentriggered. On July 7, 2020, the Proposal on Early Redemption of "SF Convertible Bonds” was considered andapproved at the 7th meeting of the 5th session of the Board and the 7th meeting of the 5th session of the board ofsupervisors. It was decided that the conditional redemption rights on “SF Convertible Bonds” will be exercised toredeem all the unconverted “SF Convertible Bonds” at the price of the face value of the bonds plus currentaccrued interest. The redemption price of “SF Convertible Bonds” was RMB100.14 per unit (the face value of thebonds plus current accrued interest (including taxes) ). The redemption registration date of “SF Convertible Bonds”was August 3, 2020; the redemption date of “SF Convertible Bonds” was August 4, 2020; and the tradingsuspension and conversion date of “SF Convertible Bonds” was August 4, 2020. The investor redemption paymentdate was August 11, 2020. On August 12, 2020, “SF Convertible Bonds” were delisted from the Shenzhen StockExchange. For details, please refer to the Company’s announcements (2020-039, 2020-052, 2020-059, 2020-068,2020-089) on Cninfo.
3. Commencement of asset securitization
In order to revitalize existing assets and enhance the capital utilization efficiency, the Company has established aspecial asset-backed plan by using the logistics industrial park held by the subsidiary Shenzhen FengtaiE-Commerce Industrial Park Asset Management Co., Ltd. as the principal and raised funds by means of theissuance of asset-backed securities under the plan. On November 21, 2018, the Company obtained the “NoObjection Letter regarding Huatai Asset Management’s ‘Huatai Jiayue - Shunfeng Industrial Park Phase IAsset-Backed Special Plan’ being in line with the Conditions for Listing on the Shenzhen Stock Exchange” (ShenZheng Han (深证函) [2018] No. 666) issued by the Shenzhen Stock Exchange, and the total size of issuance byway of shelf-offering approved in the No Objection Letter was RMB5 billion for a valid period of two years. In2018, the Company issued the first tranche of asset-backed securities with a total size of RMB1.846 billion. In2019, the Company issued the second tranche of asset-backed securities with a total size of RMB1.36 billion. OnJune 29, 2020, the Company held the 6th meeting of the 5th session of the Board and the 6th meeting of the 5thsession of the board of supervisors respectively at which the Proposal on Carrying out Asset Securitization andRelated Party Transactions was considered and approved. The Company intends to continue carry out the assetsecuritization business and raise funds through the issuance of asset-backed securities by means of a special plan.The special plan for this period is the third tranche within the shelf quota. The total size of asset-backed securitiesto be issued in this period does not exceed RMB1.5 billion. For details, please refer to the announcement(2020-062) disclosed by the Company on Cninfo. As of the disclosure date of this report, transaction documentsrelating to the special plan have yet to be signed, and the special plan has not been formally established.
A disclosure index for the above-mentioned significant events and other significant events is as below:
| Announcement | Disclosure Date | Disclosure Website |
| Announcement on Receipt of the Notice of Acceptance for Registration by the Wholly-owned Subsidiary Shenzhen S.F. Taisen Holding (Group) Co., Ltd. from the National Association of Financial Market Institutional Investors (2020-004) | January 23, 2020 | http://www.cninfo.com.cn |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Announcement | Disclosure Date | Disclosure Website |
| Announcement on Progress of Issuance of Overseas US Dollar Bonds by an Overseas Wholly-owned Subsidiary (2020-005) | February 14, 2020 | http://www.cninfo.com.cn |
| Announcement on Completion of Issuance of Overseas US Dollar Bonds by an Overseas Wholly-owned Subsidiary (2020-007) | February 22, 2020 | http://www.cninfo.com.cn |
| Announcement on Results of Issuance of the 2020 First Tranche of Super Short-Term Commercial Paper (Epidemic Prevention and Control Bonds) by the Wholly-owned Subsidiary Shenzhen S.F. Taisen Holding (Group) Co., Ltd. (2020-008) | February 22, 2020 | http://www.cninfo.com.cn |
| Announcement on Results of Issuance of the 2020 Second Tranche of Super Short-Term Commercial Paper (Epidemic Prevention and Control Bonds) by Shenzhen S.F. Taisen Holding (Group) Co., Ltd. (2020-015) | March 17, 2020 | http://www.cninfo.com.cn |
| Announcement on Results of Issuance of the 2020 Third Tranche of Super Short-Term Commercial Paper by Shenzhen S.F. Taisen Holding (Group) Co., Ltd. (2020-036) | April 16, 2020 | http://www.cninfo.com.cn |
| Announcement on Implementation of Annual Dividend Distribution in 2019 (2020-038) | April 17, 2020 | http://www.cninfo.com.cn |
| Announcement on Adjustment of Stock Conversion Price of “SF Convertible Bonds” (2020-039) | April 17, 2020 | http://www.cninfo.com.cn |
| Announcement on Results of Issuance of the 2020 Fourth Tranche of Super Short-Term Commercial Paper by the Wholly-owned Subsidiary Shenzhen S.F. Taisen Holding (Group) Co., Ltd. (2020-049) | May 11, 2020 | http://www.cninfo.com.cn |
| Indicative Announcement on Commencement of Conversion of “SF Convertible Bonds” (2020-052) | May 19, 2020 | http://www.cninfo.com.cn |
| Announcement on Adjustment of Stock Conversion Price of “SF Convertible Bonds” (2020-059) | June 19, 2020 | http://www.cninfo.com.cn |
| Announcement on Carrying out Asset Securitization and Related Party Transactions (2020-062) | June 30, 2020 | http://www.cninfo.com.cn |
| Announcement on Increase of Capital in Subsidiaries (2020-063) | June 30, 2020 | http://www.cninfo.com.cn |
| Announcement on Status of Conversion of Convertible Corporate Bonds in Second Quarter of 2020 (2020-065) | July 2, 2020 | http://www.cninfo.com.cn |
| First Announcement on Implementation of Redemption of “SF Convertible Bonds” (2020-068) | July 8, 2020 | http://www.cninfo.com.cn |
| Announcement on the Delisting of SF Convertible Bonds (2020-089) | August 12, 2020 | （http://www.cninfo.com.cn） |
XVIII. Significant events of subsidiaries
□Applicable √ Not applicable
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
Chapter 6 Share Changes & Shareholder Details
I. Changes in shares
1. Changes in shares
Unit: number of shares
| Before Change | Increase or Decrease (+ or -) | After Change | |||||||
| Number of shares | Proportion | New shares issued | Bonus shares | Conversion of equity reserve into share capital | Others | Subtotal | Number of shares | Proportion | |
| I. Restricted sales of shares | 2,783,633,172 | 63.06% | - | - | - | -2,717,187,436 | -2,717,187,436 | 66,445,736 | 1.49% |
| 3.Other shares held by domestic capital | 2,783,588,909 | 63.05% | - | - | - | -2,717,143,173 | -2,717,143,173 | 66,445,736 | 1.49% |
| Of which: Other shares held by domestic legal person | 2,701,927,139 | 61.20% | - | - | - | -2,701,927,139 | -2,701,927,139 | - | - |
| Other shares held by domestic natural person | 81,661,770 | 1.85% | - | - | - | -15,216,034 | -15,216,034 | 66,445,736 | 1.49% |
| 4.Shares held by overseas capital | 44,263 | 0.00% | - | - | - | -44,263 | -44,263 | - | - |
| Of which: Other shares held by overseas legal person | - | - | - | - | - | - | - | - | - |
| Other shares held by overseas natural person | 44,263 | 0.00% | - | - | - | -44,263 | -44,263 | - | - |
| II. Unrestricted sales of shares | 1,630,952,093 | 36.94% | - | - | - | 2,750,975,667 | 2,750,975,667 | 4,381,927,760 | 98.51% |
| 1.RMB-denominated ordinary shares | 1,630,952,093 | 36.94% | - | - | - | 2,750,975,667 | 2,750,975,667 | 4,381,927,760 | 98.51% |
| III. Total number of shares | 4,414,585,265 | 100.00% | - | - | - | 33,788,231 | 33,788,231 | 4,448,373,496 | 100.00% |
Reasons of share changes
√ Applicable □Not applicable
On November 18, 2019, the Company publicly issued 58 million convertible corporate bonds in the total amountof RMB5.8 billion. On May 22, 2020, these convertible corporate bonds entered the conversion period. As of June30, 2020, the number of shares converted during the reporting period was 36,244,799 shares.
Due to the implementation of the 2018 restricted stock incentive plan, the Company completed the repurchase andcancellation of restricted shares that have been awarded but not yet been released from restriction held by eligibleparticipants no longer meeting the conditions for incentives in the amount of 274,346 shares and 2,182,222 shareson March 17, 2020 and June 19, 2020 respectively.
In summary, during the reporting period, the Company’s shares increased by 33,788,231 shares and the totalnumber of shares changed from 4,414,585,265 shares to 4,448,373,496 shares.
Approval of share changes
□ Applicable √ Not applicable
Transfer of share ownership
□ Applicable √ Not applicable
Implementation progress of share repurchase
□ Applicable √ Not applicable
Implementation of share reduction through aggregate auction
□ Applicable √ Not applicable
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
Effects of share changes on the basic EPS, diluted EPS, net assets per share attributable to ordinary shareholdersof the Company, and other financial indicators for the last year and the last reporting period
√ Applicable □ Not applicable
During the reporting period, the share capital of the Company increased by 33,788,231 shares, which had adilution effect on the basic EPS, diluted EPS and net assets per share attributable to ordinary shareholders of theCompany.
Other contents that the Company considers necessary, or are required by the securities regulatory authorities, todisclose
□ Applicable √ Not applicable
2. Changes in restricted shares
√ Applicable □Not applicable
Unit: number of shares
| Name of shareholder | Restricted shares at the beginning of the period | Number of restricted shares removed in the period | Number of restricted shares increased in the period | Restricted shares at the end of the period | Restricted sales reasons | Date of restricted sales removal |
| Shenzhen Mingde Holding Development Co., Ltd. | 2,701,927,139 | 2,701,927,139 | - | - | Commitment for issuing restricted shares for purchasing assets during major asset restructuring | January 23, 2020 |
| Liu Jilu | 67,559,346 | 1,953,375 | 11,250 | 65,617,221 | restricted shares for senior managers | 1,953,375 lock-up shares of senior management were unlocked at the beginning of 2020. |
| Liu Lingyun | 4,456,942 | 4,456,942 | - | - | restricted shares for IPO | January 23, 2020 |
| Gong Weiping | 2,040,640 | 2,040,640 | - | - | restricted shares for IPO | January 23, 2020 |
| Huang Xuechun | 1,735,024 | 1,735,024 | - | - | restricted shares for IPO | January 23, 2020 |
| Yuan Fuxiang | 1,020,322 | 510,161 | - | 510,161 | restricted shares for IPO | January 23, 2020 |
| Lin Anxia | 680,214 | 680,214 | - | - | restricted shares for IPO | January 23, 2020 |
| Zhao Ming | 636,707 | 318,353 | - | 318,354 | restricted shares for IPO | January 23, 2020 |
| Wu Cuihua | 510,162 | 510,162 | - | - | restricted shares for IPO | January 23, 2020 |
| Tang Linlin | 170,054 | 170,054 | - | - | restricted shares for IPO | January 23, 2020 |
| Wang Nengying | 170,054 | 170,054 | - | - | restricted shares for IPO | January 23, 2020 |
| Others | 2,726,568 | 2,726,568 | - | - | - | - |
| Total | 2,783,633,172 | 2,717,198,686 | 11,250 | 66,445,736 | -- | -- |
Ⅱ. Issuance and Listing of Securities
□Applicable √ Not applicable
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
III. Total number of shareholders and their holdings
Unit: number of shares
| Total number of shareholders at the end of reporting period | 53,990 | Total number of preferred shareholders with voting rights restored (if any) | - | |||||||
| Shareholders holding more than 5% of shares or shares of the top 10 shareholders | ||||||||||
| Name of shareholder | Type of shareholder | Shareholding percentage | Number of shares held at the end of the reporting period | Increase or decrease of shares during reporting period | Number of restricted shares held | Number of non-restricted shares held | Pledged or frozen shares | |||
| Status of shares | Amount | |||||||||
| Shenzhen Mingde Holding Development Co., Ltd. | Domestic non-state- owned legal person | 60.74% | 2,701,927,139 | - | - | 2,701,927,139 | Pledged | 990,000,000 | ||
| Shenzhen Zhaoguang Investment Co., Ltd. | State-owned legal person | 5.99% | 266,637,546 | - | - | 266,637,546 | ||||
| Ningbo Shunda Fengrun Venture Capital Partnership (Limited Partnership) | Domestic non-state- owned legal person | 4.96% | 220,715,478 | -53,489,400 | - | 220,715,478 | Pledged | 144,648,802 | ||
| Hong Kong Securities Clearing Company Ltd. | Overseas legal person | 2.65% | 117,671,581 | 45,129,175 | - | 117,671,581 | ||||
| Suzhou Industrial Park Oriza Shunfeng Equity Investment Company (Limited Partnership) | Domestic non-state- owned legal person | 2.44% | 108,609,055 | -74,742,683 | - | 108,609,055 | - | - | ||
| Liu Jilu | Domestic natural person | 1.62% | 71,995,048 | -15,479,580 | 65,617,221 | 6,377,827 | - | - | ||
| Norges Bank – Own Funds | Overseas legal person | 0.53% | 23,621,963 | 1,559,129 | - | 23,621,963 | ||||
| Perseverance Asset Management L.L.P. – Gaoyi Linshan. No. 1 Yuanwang Fund | Other | 0.52% | 23,000,000 | -4,000,000 | - | 23,000,000 | ||||
| Industrial Bank Co., Ltd. – Aegon-Industrial Trend Investment Hybrid Securities Investment Fund | Other | 0.51% | 22,512,013 | 6,888,300 | - | 22,512,013 | ||||
| Industrial Bank Co., Ltd. – Aegon-Industrial New Horizons Flexible Allocation Regular Open-end Hybrid Securities Investment Seed Fund | Other | 0.46% | 20,319,012 | 11,629,965 | - | 20,319,012 | ||||
| Additional Shares Strategic investor or general legal person becomes the top 10 shareholder due to the placement of new shares | N/A | |||||||||
| Explain any associated relationship and/or persons acting in concert between the above-mentioned shareholders | The Company is not aware of whether there is an associated relationship between the above mentioned shareholders and whether they are acting in concert. | |||||||||
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
| Top 10 shareholders holding unrestricted shares | |||
| Name of shareholder | Number of unrestricted shares held at the end of the reporting period | Type of shares | |
| Type of shares | Quantity | ||
| Shenzhen Mingde Holding Development Co., Ltd. | 2,701,927,139 | RMB-denominated ordinary shares | 2,701,927,139 |
| Shenzhen Zhaoguang Investment Co., Ltd. | 266,637,546 | RMB-denominated ordinary shares | 266,637,546 |
| Ningbo Shunda Fengrun Venture Capital Partnership (Limited Partnership) | 220,715,478 | RMB-denominated ordinary shares | 220,715,478 |
| Hong Kong Securities Clearing Company Ltd. | 117,671,581 | RMB-denominated ordinary shares | 117,671,581 |
| Suzhou Industrial Park Oriza Shunfeng Equity Investment Company (Limited Partnership) | 108,609,055 | RMB-denominated ordinary shares | 108,609,055 |
| Norges Bank–Own Funds | 23,621,963 | RMB-denominated ordinary shares | 23,621,963 |
| Perseverance Asset Management L.L.P. – Gaoyi Linshan. No. 1 Yuanwang Fund | 23,000,000 | RMB-denominated ordinary shares | 23,000,000 |
| Industrial Bank Co., Ltd. – Aegon-Industrial Trend Investment Hybrid Securities Investment Fund | 22,512,013 | RMB-denominated ordinary shares | 22,512,013 |
| Industrial Bank Co., Ltd. – Aegon-Industrial New Horizons Flexible Allocation Regular Open-end Hybrid Securities Investment Seed Fund | 20,319,012 | RMB-denominated ordinary shares | 20,319,012 |
| Bank of Communications Co., Ltd. – Wanjia Industry Preferred Hybrid Securities Investment Fund (LOF) | 18,380,380 | RMB-denominated ordinary shares | 18,380,380 |
| Explain any associated relationship and/or persons acting in concert between the top ten shareholders | The Company is not aware of whether there is an associated relationship between the above-mentioned shareholders and whether they are acting in concert. | ||
| Explain the top 10 common shareholders’ participation in margin financing (if any) | N/A | ||
Did any of the top 10 common shareholder or the top 10 non-restricted common shareholders of the Companyconduct any promissory repurchase during the reporting period?
□Yes √ No
No such cases in the reporting period.
IV. Change of controlling shareholder or actual controllerChange of controlling shareholder in the reporting period
□Applicable √ Not applicable
Controlling shareholder did not change during the reporting period.
Change of actual controller during the reporting period
□Applicable √ Not applicable
The actual controller did not change during the reporting period.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
Chapter 7 Preferred Shares
□Applicable √ Not applicable
No such cases in the reporting period.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
Chapter 8 Convertible Corporate Bonds
√ Applicable □ Not applicable
I. Previous Adjustments of Stock Conversion PriceWith the approval of the Zheng Jian Xu Ke [2019] No.1903 document of the China Securities RegulatoryCommission, the Company publicly issued 58 million convertible corporate bonds on November 18, 2019, eachwith a face value of RMB100 amounting to RMB5.8 billion for a term of six years. With the approval of the ShenZheng Shang [2019] No.786 document of the Shenzhen Stock Exchange, the RMB5.8 billion convertiblecorporate bonds of the Company were listed for trading on the Shenzhen Stock Exchange starting from December9, 2019. The abbreviation of the bonds is “SF Convertible Bonds” and the code of the bonds is “128080”.According to relevant provisions of the Prospectus for the Public Issuance of Convertible Corporate Bonds by S.F.Holdings Co., Ltd., the initial stock conversion price of “SF Convertible Bonds” was RMB40.41 per share.
The Company implemented the 2019 annual dividend distribution plan on April 24, 2020. In accordance with theissuance clauses of the Prospectus for the Public Issuance of Convertible Corporate Bonds by S.F. Holdings Co.,Ltd. and relevant provisions of the China Securities Regulatory Commission on the issuance of convertible bonds,the stock conversion price of “SF Convertible Bonds” was adjusted from the original price of RMB40.41 pershare to RMB40.14 per share starting from April 24, 2020.
The Company held the 3rd meeting of the 5th session of the Board on March 23, 2020 and the 2019 annualgeneral meeting on April 15, 2020 at which the “Resolution regarding the Repurchase and Cancellation of CertainRestricted Shares” was considered and approved. In view of the Company’s failure to meet the performanceassessment requirements for the second lock-up period of its 2018 restricted stock incentive plan. According tothe 2018 Restricted Stock Incentive Plan of S.F. Holding Co., Ltd. (Draft), the Administrative Measures forImplementation and Assessment of the 2018 Equity Incentive Plan and other related regulations, all restrictedstocks that have been awarded but not yet been released from restriction during the second lock-up period held by944 eligible participants shall not be released from restriction and shall be repurchased and cancelled by theCompany. The Company’s board of directors agreed to the Company’s repurchase and cancellation of 2,182,222restricted shares held by the above-mentioned persons, all of which have been awarded but not yet been releasedfrom restriction. The Company completed the repurchase and cancellation of the above restricted shares on June19, 2020, and the stock conversion price of “SF Convertible Bonds” was adjusted from RMB40.14 per share toRMB 40.15 per share starting from June 19, 2020.II. Share Conversions (Cumulative)
√Applicable □Not applicable
| Bond abbreviation | Start date of share conversion | Total issuance volume (unit) | Total issuance amount (RMB) | Cumulative share conversion amount (RMB) | Cumulative number of shares converted (share) | Number of shares converted as a percentage of the Company’s total number of shares outstanding before the start date of share conversion | Non-converted amount (RMB) | Non-converted amount as a percentage of total issuance amount |
| SF Convertible Bonds | May 22, 2020 | 58,000,000 | 5,800,000,000.00 | 1,455,121,300.00 | 36,244,799 | 0.82% | 4,344,878,700.00 | 74.91% |
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
III. Top 10 Holders of the Convertible Bond
| SN | Name of convertible bond holders | Nature of convertible bond holder | The number of convertible bonds held at the end of the reporting period(number of units) | The amount of convertible bonds held at the end of the reporting period(RMB) | Percentage of convertible bonds held at the end of the reporting period |
| 1 | Bank of China Limited – Guangfa Juxin Debt Securities Investment Fund中国银行股份有限公司－广发聚鑫债券型证券投资基金 | Others | 2,381,384 | 238,138,400.00 | 5.48% |
| 2 | Industrial and Commercial Bank of China Limited-Xingquan Convertible Bond Mixed Securities Investment Fund中国工商银行股份有限公司－兴全可转债混合型证券投资基金 | Others | 2,377,428 | 237,742,800.00 | 5.47% |
| 3 | Industrial and Commercial Bank of China Limited – China Universal Convertible Bond Debt Securities Investment Fund中国工商银行股份有限公司－汇添富可转换债券债券型证券投资基金 | Others | 1,600,829 | 160,082,900.00 | 3.68% |
| 4 | GuoYuan Securities Co.,Ltd国元证券股份有限公司 | State-owned legal person | 980,000 | 98,000,000.00 | 2.26% |
| 5 | Guangfa Fund-China Merchants Bank-China MerchantsWealth Asset Management Co.,Ltd.广发基金－招商银行－招商财富资产管理有限公司 | Others | 821,419 | 82,141,900.00 | 1.89% |
| 6 | China Construction Bank Corporation Limited – Lombarda China New Blue Chip Flexible Allocation Hybrid Securities Investment Fund中国建设银行股份有限公司－中欧新蓝筹灵活配置混合型证券投资基金 | Others | 735,690 | 73,569,000.00 | 1.69% |
| 7 | Basic Pension Fund 107基本养老保险基金一零七组合 | Others | 654,387 | 65,438,700.00 | 1.51% |
| 8 | Industrial and Commercial Bank of China Limited-Eund Anxin Hubao Bond Securities Investment Fund中国工商银行股份有限公司－易方达安心回报债券型证券投资基金 | Others | 650,000 | 65,000,000.00 | 1.50% |
| 9 | Ping An Fund –Ping An Life Insurance Company of China Ltd. – Dividends – Personal Insurance Dividends – Ping An Life – Ping An Fund Fixed Income Entrusted Investment No. 1 Single Asset Management Plan平安基金－中国平安人寿保险股份有限公司－分红－个险分红－平安人寿－平安基金固定收益委托投资1号单一资产管理计划 | Others | 640,797 | 64,079,700.00 | 1.47% |
| 10 | GF Fund – Industrial and Commercial Bank – GF Fund Mixed Equity-Debt Strategy No. 1 Asset Management Plan广发基金－工商银行－广发基金股债混合策略1号资产管理计划 | Others | 638,609 | 63,860,900.00 | 1.47% |
IV. The Profitability, Asset and Credit Status of the Guarantor Have Changed Significantly
□ Applicable√ Not applicable
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
V. The Company’s Liabilities at the End of the Reporting Period, Changes in its CreditStanding, As well as the Cash Arrangements for Repayment of Debt in the Coming Years
1. The Key Financial Indicators
| Items | End of the current reporting period | End of previous year (Restated) | Increase/Decrease over previous year end |
| Current Ratio | 136.88% | 138.46% | -1.58% |
| Asset-liability ratio | 53.81% | 54.08% | -0.27% |
| Quick ratio | 134.61% | 135.61% | -1.00% |
| Items | Current reporting period | The same period of previous year (Restated) | Increase/Decrease over the same period of previous year |
| Interest coverage ratio | 10.22 | 9.84 | 3.86% |
| Loan repayment rate | 100% | 100% | 0.00% |
| Interest Payment rate | 100% | 100% | 0.00% |
2. Credit rating of the convertible bond this year
On May 21, 2020, China Chengxin International Credit Rating Co., Ltd. issued the Tracking and Rating Report onthe Public Issuance of Convertible Bonds by S.F. Holding Co., Ltd. (2020) (Xin Ping Wei Han Zi [2020] TrackingNo.0299). The Company and debts relating to the Company during its existence were tracked and rated. TheCompany’s corporate credit rating was maintained at AAA with a stable rating outlook, and the debt credit rating of“SF Convertible Bonds” was maintained at AAA. These ratings reflect that the Company’s ability to repay debts isextremely strong, basically not affected by the adverse economic environment, and the risk of default is extremelylow.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
Chapter 9 Directors, Supervisors and Senior ManagersI. Changes in shares held by directors, supervisors and senior managers
√Applicable □Not applicable
| Name | Title | Tenure status | Share held at the beginning of the period (share) | Quantity Of shares increased in the current period (share) | Quantity Of shares decreased in the current period (share) | Share held at the end of the period (share) | Restricted shares held at the beginning of the period (share) | Quantity of restricted shares increased during the reporting period (share) | Restricted shares held at the end of the period(share) |
| Liu Jilu | Supervisor | Current | 87,474,628 | 15,000 | 15,494,580 | 71,995,048 | - | - | - |
| Total | -- | -- | 87,474,628 | 15,000 | 15,494,580 | 71,995,048 | - | - | - |
II. Changes of Directors, Supervisors, and Senior Managers
□ Applicable√ Not applicable
The company’s directors, supervisors and senior managers did not change during the reporting period. For details,please refer to the 2019Annual Report.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
Chapter 10 Corporate Bonds
Were there bonds publicly issued and listed on an exchange, and not at maturity, or at maturity but are not fullypaid on the approval report date of the semi-annual report?No
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
Chapter 11 Financial Statements
| [English Translation for Reference Only] | ||
| Review Report | ||
| PwC ZT Yue Zi (2020) No. 0073 | ||
| To the shareholders of S.F. Holding Co., Ltd., | ||
| We have reviewed the accompanying interim financial statements of S.F. Holding Co., Ltd. (hereinafter “S.F. Holding”), which comprise the consolidated and company balance sheets as at 30 June 2020, the consolidated and company income statements, the consolidated and company statements of changes in equity and the consolidated and company cash flow statements for the six-month period then ended, and the notes to the interim financial statements. Management of S.F. Holding is responsible for the preparation of these interim financial statements in accordance with the requirements of Accounting Standards for Business Enterprises. Our responsibility is to issue a review report on these interim financial statements based on our review. | ||
| We conducted our review in accordance with China Standards on Review Engagement No. 2101, “Review of Financial Statements”. These standards require that we plan and perform the review to obtain limited assurance as to whether the interim financial statements are free of material misstatement. A review is limited primarily to inquiries of company personnel and analytical procedures applied to financial data and thus provides less assurance than an audit. We have not performed an audit and, accordingly, we do not express an audit opinion. | ||
| Based on our review, nothing has come to our attention that causes us to believe that the interim financial statements are not prepared in accordance with Accounting Standards for Business Enterprises or do not present fairly, in all material respects, the consolidated and company’s financial position of S.F. Holding as at 30 June 2020, and their financial performance and cash flows for the period then ended. | ||
| PricewaterhouseCoopers Zhong Tian LLP Shanghai, the People’s Republic of China 25 August 2020 | Signing CPA Signing CPA | ———————— Chen Anqiang ———————— Liu Jingping |
CONSOLIDATED BALANCE SHEETAS AT 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
| ASSETS | Note | 30 June 2020 | 31 December 2019 | |
| Consolidated | Consolidated | |||
| Current assets | ||||
| Cash at bank and on hand | 4(1) | 10,112,591,513.50 | 18,520,991,737.10 | |
| Placements with and loans to banks and other financial institutions | 4(2) | - | 200,728,611.11 | |
| Financial assets held for trading | 4(3) | 13,471,415,608.93 | 2,910,172,928.20 | |
| Notes receivable | 99,520,283.19 | 43,004,793.59 | ||
| Accounts receivable | 4(4) | 13,200,537,169.56 | 12,044,542,725.83 | |
| Advances to suppliers | 4(5) | 2,663,945,245.24 | 2,654,244,964.25 | |
| Factoring receivables | 4(6) | 2,510,731.87 | 52,697,167.86 | |
| Loans and advances | 4(7) | 47,040,678.64 | 81,742,106.20 | |
| Other receivables | 4(8) | 2,019,189,501.37 | 2,102,207,239.40 | |
| Inventories | 4(9) | 834,416,314.91 | 881,658,973.69 | |
| Contract assets | 4(10) | 359,294,568.02 | -- | |
| Current portion of non-current assets | 4(12) | 136,696,803.40 | 105,344,257.09 | |
| Other current assets | 4(11) | 7,482,260,841.70 | 3,299,684,720.94 | |
| Total current assets | 50,429,419,260.33 | 42,897,020,225.26 | ||
| Non-current assets | ||||
| Long-term receivables | 4(12) | 532,081,662.87 | 465,733,312.28 | |
| Long-term equity investments | 4(13) | 2,226,434,362.47 | 2,221,512,673.14 | |
| Investments in other equity instruments | 4(14) | 5,059,004,416.40 | 4,933,692,937.19 | |
| Other non-current financial assets | 4(15) | 536,270,955.85 | 479,040,431.62 | |
| Investment properties | 4(16) | 2,119,742,157.85 | 2,019,525,900.61 | |
| Fixed assets | 4(17) | 19,645,792,982.24 | 18,903,827,062.42 | |
| Construction in progress | 4(18) | 3,573,345,371.79 | 3,116,490,618.26 | |
| Intangible assets | 4(19) | 10,164,552,265.54 | 10,008,036,356.04 | |
| Capitalised development expenditures | 4(20) | 607,607,203.18 | 582,627,977.20 | |
| Goodwill | 4(21) | 3,627,083,179.38 | 3,564,540,458.80 | |
| Long-term prepaid expenses | 4(22) | 1,544,666,351.35 | 1,714,173,133.47 | |
| Deferred tax assets | 4(39) | 1,004,974,716.39 | 1,066,079,111.56 | |
| Other non-current assets | 4(23) | 974,855,783.36 | 563,086,609.99 | |
| Total non-current assets | 51,616,411,408.67 | 49,638,366,582.58 | ||
| TOTAL ASSETS | 102,045,830,669.00 | 92,535,386,807.84 |
CONSOLIDATED BALANCE SHEET (CONT’D)AS AT 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
| LIABILITIES AND EQUITY | Note | 30 June 2020 | 31 December 2019 | |
| Consolidated | Consolidated | |||
| Current liabilities | ||||
| Short-term borrowings | 4(25) | 6,546,993,089.05 | 6,053,374,642.50 | |
| Deposits from customers | 5,164,868.18 | 3,778,707.92 | ||
| Notes payable | 15,000,000.00 | 30,000,000.00 | ||
| Accounts payable | 4(26) | 12,185,137,292.01 | 11,988,256,010.34 | |
| Advances from customers | 4(27) | 16,851,919.37 | 669,948,930.72 | |
| Contract liabilities | 4(28) | 1,117,387,097.90 | -- | |
| Employee benefits payable | 4(29) | 3,698,291,918.49 | 3,281,062,510.03 | |
| Taxes payable | 4(30) | 1,424,548,788.04 | 1,139,144,005.66 | |
| Other payables | 4(31) | 5,434,784,386.15 | 4,707,159,830.62 | |
| Current portion of non-current liabilities | 4(32) | 2,350,398,255.88 | 2,091,892,291.74 | |
| Other current liabilities | 4(33) | 4,048,584,624.75 | 1,017,446,858.50 | |
| Total current liabilities | 36,843,142,239.82 | 30,982,063,788.03 | ||
| Non-current liabilities | ||||
| Long-term borrowings | 4(34) | 1,618,059,208.49 | 6,539,556,784.41 | |
| Debentures payable | 4(35) | 14,340,521,922.19 | 10,597,985,016.52 | |
| Long-term payables | 4(36) | 56,502,003.91 | 78,310,329.77 | |
| Long-term employee benefits payable | 4(37) | 210,706,387.33 | 204,466,446.73 | |
| Deferred income | 4(38) | 195,339,843.45 | 201,496,411.81 | |
| Deferred tax liabilities | 4(39) | 1,599,843,956.54 | 1,387,699,268.53 | |
| Provisions | 48,853,639.06 | 50,197,780.66 | ||
| Total non-current liabilities | 18,069,826,960.97 | 19,059,712,038.43 | ||
| Total liabilities | 54,912,969,200.79 | 50,041,775,826.46 | ||
| Equity | ||||
| Share capital | 4(40) | 4,448,373,496.00 | 4,414,585,265.00 | |
| Other equity instruments | 4(41) | 576,024,904.25 | 768,938,484.90 | |
| Capital reserve | 4(42) | 17,906,049,059.17 | 16,124,018,594.16 | |
| Less: Treasury stock | 4(43) | (394,992,924.06) | (454,761,306.79) | |
| Other comprehensive income | 4(64) | 1,149,198,107.09 | 1,002,715,607.38 | |
| General risk reserve | 228,127,965.31 | 225,783,247.34 | ||
| Surplus reserve | 4(45) | 601,241,237.54 | 601,241,237.54 | |
| Retained earnings | 4(46) | 22,340,359,742.76 | 19,737,192,610.27 | |
| Total equity attributable to shareholders of the Company | 46,854,381,588.06 | 42,419,713,739.80 | ||
| Minority interests | 4(47) | 278,479,880.15 | 73,897,241.58 | |
| Total equity | 47,132,861,468.21 | 42,493,610,981.38 | ||
| TOTAL LIABILITIES AND EQUITY | 102,045,830,669.00 | 92,535,386,807.84 |
The accompanying notes form an integral part of these financial statements.
Legal representative: Principal in charge of accounting: Head of accounting department:
COMPANY BALANCE SHEETAS AT 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
| ASSETS | Note | 30 June 2020 | 31 December 2019 | |
| Company | Company | |||
| Current assets | ||||
| Cash at bank and on hand | 16(1) | 141,183,142.71 | 967,647,842.56 | |
| Financial assets held for trading | 3,008,609,136.97 | 2,416,892,164.39 | ||
| Advances to suppliers | 2,075,176.35 | 881,289.27 | ||
| Other receivables | 16(2) | 2,939,202,474.46 | 3,364,547,392.85 | |
| Other current assets | 93,820,004.65 | 606,990,464.38 | ||
| Total current assets | 6,184,889,935.14 | 7,356,959,153.45 | ||
| Non-current assets | ||||
| Long-term receivables | 16(3) | 7,673,525,251.44 | 7,691,259,432.16 | |
| Long-term equity investments | 16(4) | 43,323,539,117.29 | 43,323,539,117.29 | |
| Intangible assets | 1,938,358.98 | 1,687,542.87 | ||
| Capitalised development expenditures | 23,756.06 | 246,398.52 | ||
| Long-term prepaid expenses | 48,320.29 | 69,028.99 | ||
| Total non-current assets | 50,999,074,804.06 | 51,016,801,519.83 | ||
| TOTAL ASSETS | 57,183,964,739.20 | 58,373,760,673.28 | ||
COMPANY BALANCE SHEET (CONT’D)AS AT 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
| LIABILITIES AND EQUITY | Note | 30 June 2020 | 31 December 2019 | |
| Company | Company | |||
| Current liabilities | ||||
| Employee benefits payable | 680,000.00 | 380,000.00 | ||
| Other payables | 2,510,498.80 | 63,611,663.06 | ||
| Current portion of non-current liabilities | 5,356,699.78 | 1,366,575.34 | ||
| Taxes payable | 4,836,529.80 | - | ||
| Total current liabilities | 13,383,728.38 | 65,358,238.40 | ||
| Non-current liabilities | ||||
| Debentures payable | 3,840,687,390.43 | 5,031,969,368.14 | ||
| Deferred tax liabilities | - | 1,723,041.10 | ||
| Total non-current liabilities | 3,840,687,390.43 | 5,033,692,409.24 | ||
| Total liabilities | 3,854,071,118.81 | 5,099,050,647.64 | ||
| Equity | ||||
| Share capital | 4,448,373,496.00 | 4,414,585,265.00 | ||
| Other equity instruments | 576,024,904.25 | 768,938,484.90 | ||
| Capital reserve | 48,029,039,339.26 | 46,642,944,149.90 | ||
| Less: Treasury stock | (394,992,924.06) | (454,761,306.79) | ||
| Surplus reserve | 448,196,237.23 | 448,196,237.23 | ||
| Retained earnings | 223,252,567.71 | 1,454,807,195.40 | ||
| Total equity | 53,329,893,620.39 | 53,274,710,025.64 | ||
| TOTAL LIABILITIES AND EQUITY | 57,183,964,739.20 | 58,373,760,673.28 |
The accompanying notes form an integral part of these financial statements.
Legal representative: Principal in charge of accounting: Head of accounting department:
CONSOLIDATED AND COMPANY INCOME STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
| For the six months ended 30 June | ||||||||
| Item | Note | 2020 | 2019 | 2020 | 2019 | |||
| Consolidated | Consolidated (Restated) (Note 5(1)) | Company | Company | |||||
| 1. Revenue | 4(48) | 71,129,007,738.21 | 50,074,704,033.85 | - | - | |||
| Less: Cost of revenue | 4(48) | (57,863,128,901.41) | (40,152,044,224.73) | - | - | |||
| Taxes and surcharges | 4(49) | (181,851,687.80) | (121,115,264.44) | (152,793.39) | (30,951.27) | |||
| Selling and distribution expenses | 4(50) | (1,056,658,701.93) | (884,558,139.21) | - | - | |||
| General and administrative expenses | 4(51) | (5,861,443,162.73) | (4,844,842,279.57) | (3,945,277.40) | (4,484,483.37) | |||
| Research and development expenses | 4(52) | (733,339,628.41) | (509,094,373.89) | (10,764.93) | - | |||
| Financial (costs)/income | 4(53) | (472,967,469.92) | (331,613,346.38) | (92,238,167.70) | 10,098,014.14 | |||
| Including: Interest expenses | (568,057,438.29) | (432,953,909.77) | (100,954,908.22) | (1,373,547.25) | ||||
| Interest income | 78,055,138.82 | 140,657,963.28 | 8,727,879.35 | 11,482,407.08 | ||||
| Add: Other income | 4(55) | 645,710,052.98 | 164,346,392.59 | 24,401.99 | - | |||
| Investment income | 4(56) 16(5) | 223,418,158.46 | 386,073,900.85 | 44,903,960.29 | 1,929,291.51 | |||
| Including: Investment losses from associates and joint ventures | (18,458,687.72) | (50,985,409.53) | - | - | ||||
| Gains arising from changes in fair value | 4(57) | 16,413,953.16 | 330,207,611.55 | 1,716,972.58 | - | |||
| Credit impairment losses | 4(58) | (459,541,101.91) | (148,865,353.45) | - | - | |||
| Asset impairment losses | 4(59) | (27,469,084.52) | (54,112,179.14) | - | - | |||
| Losses on disposal of assets | 4(60) | (9,646,491.49) | (12,876,151.73) | - | - | |||
| 2. Operating profit/(loss) | 5,348,503,672.69 | 3,896,210,626.30 | (49,701,668.56) | 7,511,871.01 | ||||
| Add: Non-operating income | 4(61)(a) | 89,733,785.62 | 70,153,540.77 | 4,725,851.13 | 4,716,981.13 | |||
| Less: Non-operating expenses | 4(61)(b) | (99,473,652.09) | (41,761,260.71) | - | - | |||
| 3. Total profit/(loss) | 5,338,763,806.22 | 3,924,602,906.36 | (44,975,817.43) | 12,228,852.14 | ||||
| Less: Income tax (expenses)/credits | 4(62) | (1,714,998,647.00) | (882,642,296.52) | 1,723,041.10 | (2,878,075.90) | |||
| 4. Net profit/(loss) | 3,623,765,159.22 | 3,041,960,609.84 | (43,252,776.33) | 9,350,776.24 | ||||
| Including: Net loss of the acquiree in a business combination involving enterprises under common control before the combination date | - | (1,303,632.26) | Not applicable | Not applicable | ||||
| Classified by continuity of operations: | ||||||||
| Net profit/(loss) from continuing operations | 3,623,765,159.22 | 3,041,960,609.84 | (43,252,776.33) | 9,350,776.24 | ||||
| Net profit from discontinued operations | - | - | - | - | ||||
| Classified by ownership of the equity: | ||||||||
| Attributable to shareholders of the Company | 3,761,593,296.43 | 3,099,808,006.37 | Not applicable | Not applicable | ||||
| Minority interests | (137,828,137.21) | (57,847,396.53) | Not applicable | Not applicable |
CONSOLIDATED AND COMPANY INCOME STATEMENTS (CONT’D)FOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
| For the six months ended 30 June | ||||||||
| Item | Note | 2020 | 2019 | 2020 | 2019 | |||
| Consolidated | Consolidated (Restated) (Note 5(1)) | Company | Company | |||||
| 5. Other comprehensive income, net of tax | 146,353,697.64 | (8,045,780.57) | - | - | ||||
| Attributable to shareholders of the Company, net of tax | 146,482,499.71 | (8,131,829.98) | - | - | ||||
| Other comprehensive income items which will not be reclassified subsequently to profit or loss | 41,738,101.54 | (21,354,283.70) | - | - | ||||
| Gains or losses arising from changes in fair value of other equity instruments | 4(64) | 40,865,087.90 | (21,354,283.70) | - | - | |||
| Other comprehensive income items which will not be transferred to profit or loss under the equity method | 4(64) | 873,013.64 | - | - | - | |||
| Other comprehensive income items which will be reclassified subsequently to profit or loss | 104,744,398.17 | 13,222,453.72 | - | - | ||||
| Share of the other comprehensive income of the investee accounted for using equity method which will be reclassified subsequently to profit and loss | - | (1,956,923.83) | - | - | ||||
| Exchange differences on translation of foreign currency financial statements | 4(64) | 104,744,398.17 | 15,179,377.55 | - | - | |||
| Attributable to minority interests, net of tax | 4(64) | (128,802.07) | 86,049.41 | - | - | |||
| 6. Total comprehensive income | 3,770,118,856.86 | 3,033,914,829.27 | (43,252,776.33) | 9,350,776.24 | ||||
| Attributable to shareholders of the Company | 3,908,075,796.14 | 3,091,676,176.39 | Not applicable | Not applicable | ||||
| Attributable to minority interests | (137,956,939.28) | (57,761,347.12) | Not applicable | Not applicable | ||||
| 7. Earnings per share | ||||||||
| Basic earnings per share (RMB Yuan) | 4(63) | 0.85 | 0.70 | Not applicable | Not applicable | |||
| Diluted earnings per share (RMB Yuan) | 4(63) | 0.85 | 0.70 | Not applicable | Not applicable |
The accompanying notes form an integral part of these financial statements.
Legal representative: Principal in charge of accounting: Head of accounting department:
CONSOLIDATED AND COMPANY CASH FLOW STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
| For the six months ended 30 June | ||||||||
| Item | Note | 2020 | 2019 | 2020 | 2019 | |||
| Consolidated | Consolidated (Restated) | Company | Company | |||||
| 1. Cash flows from operating activities | ||||||||
| Cash received from sales of goods or rendering of services | 72,947,979,643.63 | 53,506,206,887.19 | - | - | ||||
| Net decrease in loans to customers | - | 316,421,622.83 | - | - | ||||
| Net decrease in balances with central bank | - | 281,029,856.02 | - | - | ||||
| Net decrease in placements with and loans to banks and other financial institutions | 200,000,000.00 | - | - | - | ||||
| Net increase in deposits from customers, banks and other financial institutions | 1,379,123.94 | - | - | - | ||||
| Refund of taxes and levies | 72,251,370.53 | 23,224,357.25 | - | - | ||||
| Cash received relating to other operating activities | 4(65)(a) | 36,120,935,884.94 | 25,628,536,386.72 | 16,784,720.65 | 18,173,510.83 | |||
| Sub-total of operating cash inflows | 109,342,546,023.04 | 79,755,419,110.01 | 16,784,720.65 | 18,173,510.83 | ||||
| Cash paid for goods and services | (46,139,569,576.39) | (32,221,148,364.10) | - | - | ||||
| Net decrease in deposits from customers, banks and other financial institutions | - | (10,220,118.69) | - | - | ||||
| Net increase in loans to customers | (50,761,631.37) | - | - | - | ||||
| Net increase in balances with central bank | (9,705,168.79) | - | - | - | ||||
| Cash paid to and on behalf of employees | (12,231,862,172.78) | (11,037,328,992.91) | (1,060,000.00) | (760,000.00) | ||||
| Payments of taxes and levies | (2,492,140,114.50) | (1,562,754,409.01) | (1,303,436.03) | (8,754,992.46) | ||||
| Cash paid relating to other operating activities | 4(65)(b) | (41,486,795,039.11) | (30,103,153,608.74) | (4,859,502.53) | (4,927,726.60) | |||
| Sub-total of operating cash outflows | (102,410,833,702.94) | (74,934,605,493.45) | (7,222,938.56) | (14,442,719.06) | ||||
| Net cash flows from operating activities | 4(66)(a) | 6,931,712,320.10 | 4,820,813,616.56 | 9,561,782.09 | 3,730,791.77 | |||
| 2. Cash flows used in investing activities | ||||||||
| Cash received from disposal of investments | 14,054,523.72 | 144,554,498.39 | - | - | ||||
| Cash received from returns on investments | 239,369,492.41 | 93,138,373.02 | 1,166,683,179.88 | 1,002,167,424.66 | ||||
| Cash received from disposal of fixed assets and other long-term assets | 21,609,036.69 | 15,953,688.71 | - | - | ||||
| Net cash received from disposal of subsidiaries and other business units | 30,000,000.00 | 201,048,485.80 | - | - | ||||
| Cash received relating to other investing activities | 4(65)(d) | 52,830,000,000.00 | 19,610,047,058.44 | 9,802,734,180.72 | 1,005,498,875.49 | |||
| Sub-total of investing cash inflows | 53,135,033,052.82 | 20,064,742,104.36 | 10,969,417,360.60 | 2,007,666,300.15 | ||||
| Cash paid to acquire fixed assets and other long-term assets | (3,973,822,904.91) | (3,298,503,586.46) | (76,698.78) | (2,053,459.01) | ||||
| Cash paid to acquire investments | (99,952,404.12) | (781,352,136.83) | - | - | ||||
| Net cash paid to acquire subsidiaries | 4(65)(c) | - | (5,167,526,650.16) | - | - | |||
| Cash paid relating to other investing activities | 4(65)(e) | (66,931,335,372.60) | (23,975,039,249.75) | (10,554,370,000.00) | (1,357,929,526.75) | |||
| Sub-total of investing cash outflows | (71,005,110,681.63) | (33,222,421,623.20) | (10,554,446,698.78) | (1,359,982,985.76) | ||||
| Net cash flows (used in)/from investing activities | (17,870,077,628.81) | (13,157,679,518.84) | 414,970,661.82 | 647,683,314.39 | ||||
CONSOLIDATED AND COMPANY CASH FLOW STATEMENTS (CONT'D)FOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
| For the six months ended 30 June | ||||||||
| Item | Note | 2020 | 2019 | 2020 | 2019 | |||
| Consolidated | Consolidated (Restated) | Company | Company | |||||
| 3. Cash flows from financing activities | ||||||||
| Cash received from capital contributions | 628,689,248.52 | 30,299,062.00 | - | - | ||||
| Including: Cash received from capital contributions by minority interests of subsidiaries | 628,689,248.52 | 30,299,062.00 | - | - | ||||
| Cash received from borrowings and issue of debentures | 13,587,708,869.12 | 14,472,889,511.02 | - | - | ||||
| Sub-total of financing cash inflows | 14,216,398,117.64 | 14,503,188,573.02 | - | - | ||||
| Cash repayments of borrowings | (10,113,537,717.41) | (7,734,415,458.62) | (200,000.00) | - | ||||
| Cash payments for interest expenses and distribution of dividends or profits | (1,473,795,893.91) | (1,288,529,595.04) | (1,190,371,675.27) | (926,755,859.89) | ||||
| Cash payments relating to other financing activities | 4(65)(f) | (83,345,117.41) | (511,724,131.08) | (59,418,005.17) | (502,850,246.57) | |||
| Sub-total of financing cash outflows | (11,670,678,728.73) | (9,534,669,184.74) | (1,249,989,680.44) | (1,429,606,106.46) | ||||
| Net cash flows from/(used in) financing activities | 2,545,719,388.91 | 4,968,519,388.28 | (1,249,989,680.44) | (1,429,606,106.46) | ||||
| 4. Effect of foreign exchange rate changes on cash and cash equivalents | 18,922,139.93 | (2,915,022.58) | 86.68 | (126.46) | ||||
| 5. Net decrease in cash and cash equivalents | 4(66)(b) | (8,373,723,779.87) | (3,371,261,536.58) | (825,457,149.85) | (778,192,126.76) | |||
| Add: Cash and cash equivalents at the beginning of the period | 4(66)(b) | 17,764,448,498.26 | 15,299,271,593.99 | 966,640,292.56 | 1,136,148,582.11 | |||
| 6. Cash and cash equivalents at the end of the period | 4(66)(c) | 9,390,724,718.39 | 11,928,010,057.41 | 141,183,142.71 | 357,956,455.35 | |||
The accompanying notes form an integral part of these financial statements.
Legal representative: Principal in charge of accounting: Head of accounting department:
CONSOLIDATED STATEMENT OF CHANGES IN EQUITYFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
| Equity attributable to shareholders of the parent company | ||||||||||||||||||||
| Note | Share capital | Capital reserve | Less: Treasury stock | Other comprehensive income | General risk reserve | Special reserve | Surplus reserve | Retained earnings | Minority interests | Total equity | ||||||||||
| Balance at 1 January 2019 | 4,418,767,258.00 | 16,219,619,165.67 | (200,928,467.28) | 544,649,395.59 | 185,084,995.61 | - | 601,132,890.32 | 14,960,062,609.04 | 352,931,633.27 | 37,081,319,480.22 | ||||||||||
| Movements for the six months ended 30 June 2019 | ||||||||||||||||||||
| Total comprehensive income | ||||||||||||||||||||
| Net profit | - | - | - | - | - | - | - | 3,099,808,006.37 | (57,847,396.53) | 3,041,960,609.84 | ||||||||||
| Other comprehensive income | - | - | - | (8,131,829.98) | - | - | - | - | 86,049.41 | (8,045,780.57) | ||||||||||
| Total comprehensive income for the period | - | - | - | (8,131,829.98) | - | - | - | 3,099,808,006.37 | (57,761,347.12) | 3,033,914,829.27 | ||||||||||
| Capital contribution and withdrawal by shareholders | ||||||||||||||||||||
| Capital contribution by shareholders | - | 16,277,032.73 | - | - | - | - | - | - | 14,022,029.27 | 30,299,062.00 | ||||||||||
| Shares repurchased | 4(43) | - | - | (394,996,314.03) | - | - | - | - | - | - | (394,996,314.03) | |||||||||
| Changes in share-based payment restricted shares | (4,181,993.00) | (104,584,725.90) | 141,160,053.20 | - | - | - | - | - | - | 32,393,334.30 | ||||||||||
| Share-based payment included in equity | 9(1) | - | 14,581,133.08 | - | - | - | - | - | - | 1,016,579.73 | 15,597,712.81 | |||||||||
| Others | - | (11,159,460.36) | - | - | - | - | - | - | (24,284,337.83) | (35,443,798.19) | ||||||||||
| Transfer within equity | ||||||||||||||||||||
| Transfer from other comprehensive income to retained earnings | - | - | - | 54,334,158.75 | - | - | - | (54,334,158.75) | - | - | ||||||||||
| Profit distribution | ||||||||||||||||||||
| Distribution to shareholders | 4(43) 4(46) | - | - | 503,792.87 | - | - | - | - | (924,735,176.17) | - | (924,231,383.30) | |||||||||
| Other movements in capital reserve | - | 842,393.75 | - | - | - | - | - | - | - | 842,393.75 | ||||||||||
| Safety reserve | ||||||||||||||||||||
| Appropriation | 4(44) | - | - | - | - | - | 3,776,493.37 | - | - | - | 3,776,493.37 | |||||||||
| Utilisation | 4(44) | - | - | - | - | - | (3,776,493.37) | - | - | - | (3,776,493.37) | |||||||||
| Balance at 30 June 2019 | 4,414,585,265.00 | 16,135,575,538.97 | (454,260,935.24) | 590,851,724.36 | 185,084,995.61 | - | 601,132,890.32 | 17,080,801,280.49 | 285,924,557.32 | 38,839,695,316.83 | ||||||||||
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (CONT’D)FOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
| Equity attributable to shareholders of the parent company | ||||||||||||||||||||||
| Note | Share capital | Other equity instruments | Capital reserve | Less: Treasury stock | Other comprehensive income | General risk reserve | Special reserve | Surplus reserve | Retained earnings | Minority interests | Total equity | |||||||||||
| Balance at 31 December 2019 | 4,414,585,265.00 | 768,938,484.90 | 16,124,018,594.16 | (454,761,306.79) | 1,002,715,607.38 | 225,783,247.34 | - | 601,241,237.54 | 19,737,192,610.27 | 73,897,241.58 | 42,493,610,981.38 | |||||||||||
| Changes in accounting policies | 2(31) | - | - | - | - | - | - | - | - | 32,220,405.39 | - | 32,220,405.39 | ||||||||||
| Balance at 1 January 2020 | 4,414,585,265.00 | 768,938,484.90 | 16,124,018,594.16 | (454,761,306.79) | 1,002,715,607.38 | 225,783,247.34 | - | 601,241,237.54 | 19,769,413,015.66 | 73,897,241.58 | 42,525,831,386.77 | |||||||||||
| Movements for the six months ended 30 June 2020 | ||||||||||||||||||||||
| Total comprehensive income | ||||||||||||||||||||||
| Net profit | - | - | - | - | - | - | - | - | 3,761,593,296.43 | (137,828,137.21) | 3,623,765,159.22 | |||||||||||
| Other comprehensive income | - | - | - | - | 146,482,499.71 | - | - | - | - | (128,802.07) | 146,353,697.64 | |||||||||||
| Total comprehensive income for the period | - | - | - | - | 146,482,499.71 | - | - | - | 3,761,593,296.43 | (137,956,939.28) | 3,770,118,856.86 | |||||||||||
| Capital contribution and withdrawal by shareholders | ||||||||||||||||||||||
| Capital contribution by shareholders | - | - | 461,825,148.38 | - | - | - | - | - | - | 166,864,100.14 | 628,689,248.52 | |||||||||||
| Convertible corporate debentures transfer to share capital and capital reserve | 4(35)(d) | 36,244,799.00 | (192,913,580.65) | 1,443,407,004.09 | - | - | - | - | - | - | - | 1,286,738,222.44 | ||||||||||
| Other equity instruments issued by subsidiaries | 4(33)(b) | - | - | - | - | - | - | - | - | - | 59,516,921.23 | 59,516,921.23 | ||||||||||
| Changes in share-based payment restricted shares | 4(43) | (2,456,568.00) | - | (57,311,814.73) | 59,768,382.73 | - | - | - | - | - | - | - | ||||||||||
| Share-based payment included in equity | 9(1) | - | - | 47,180,411.55 | - | - | - | - | - | - | 7,072,954.99 | 54,253,366.54 | ||||||||||
| Others | - | - | (118,279,760.81) | - | - | - | - | - | - | 109,085,601.49 | (9,194,159.32) | |||||||||||
| Profit distribution | - | |||||||||||||||||||||
| Appropriation to general risk reserve | 4(46) | - | - | - | - | - | 2,344,717.97 | - | - | (2,344,717.97) | - | - | ||||||||||
| Distribution to shareholders | 4(46) | - | - | - | - | - | - | - | - | (1,188,301,851.36) | - | (1,188,301,851.36) | ||||||||||
| Other movements in capital reserve | - | - | 5,209,476.53 | - | - | - | - | - | - | - | 5,209,476.53 | |||||||||||
| Safety reserve | - | |||||||||||||||||||||
| Appropriation | 4(44) | - | - | - | - | - | - | 12,187,435.48 | - | - | - | 12,187,435.48 | ||||||||||
| Utilisation | 4(44) | - | - | - | - | - | - | (12,187,435.48) | - | - | - | (12,187,435.48) | ||||||||||
| Balance at 30 June 2020 | 4,448,373,496.00 | 576,024,904.25 | 17,906,049,059.17 | (394,992,924.06) | 1,149,198,107.09 | 228,127,965.31 | - | 601,241,237.54 | 22,340,359,742.76 | 278,479,880.15 | 47,132,861,468.21 | |||||||||||
The accompanying notes form an integral part of these financial statements.
Legal representative: Principal in charge of accounting: Head of accounting department:
COMPANY STATEMENT OF CHANGES IN EQUITYFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
| Note | Share capital | Other equity instruments | Capital reserve | Less: Treasury stock | Surplus reserve | Retained earnings | Total equity | |||||||
| Balance at 1 January 2019 | 4,418,767,258.00 | - | 46,760,852,084.19 | (200,928,467.28) | 448,087,890.01 | 2,378,066,843.65 | 53,804,845,608.57 | |||||||
| Movements for the six months ended 30 June 2019 | ||||||||||||||
| Total comprehensive income | ||||||||||||||
| Net profit | - | - | - | - | - | 9,350,776.24 | 9,350,776.24 | |||||||
| Capital contribution and withdrawal by shareholders | ||||||||||||||
| Shares repurchased | - | - | - | (394,996,314.03) | - | - | (394,996,314.03) | |||||||
| Changes in share-based restricted shares | (4,181,993.00) | - | (104,584,725.90) | 141,160,053.20 | - | - | 32,393,334.30 | |||||||
| Share-based payment included in equity | - | - | 11,681,356.03 | - | - | - | 11,681,356.03 | |||||||
| Profit distribution | ||||||||||||||
| Distribution to shareholders | - | - | - | 503,792.87 | - | (924,735,176.17) | (924,231,383.30) | |||||||
| Balance at 30 June 2019 | 4,414,585,265.00 | - | 46,667,948,714.32 | (454,260,935.24) | 448,087,890.01 | 1,462,682,443.72 | 52,539,043,377.81 |
| Balance at 1 January 2020 | 4,414,585,265.00 | 768,938,484.90 | 46,642,944,149.90 | (454,761,306.79) | 448,196,237.23 | 1,454,807,195.40 | 53,274,710,025.64 | |||||||
| Movements for the six months ended 30 June 2020 | ||||||||||||||
| Total comprehensive income | ||||||||||||||
| Net loss | - | - | - | - | - | (43,252,776.33) | (43,252,776.33) | |||||||
| Capital contribution and withdrawal by shareholders | ||||||||||||||
| Capital contribution by holders of convertible corporate debentures | 4(35)(d) | 36,244,799.00 | (192,913,580.65) | 1,443,407,004.09 | - | - | - | 1,286,738,222.44 | ||||||
| Changes in share-based restricted shares | 4(43) | (2,456,568.00) | - | (57,311,814.73) | 59,768,382.73 | - | - | - | ||||||
| Profit distribution | ||||||||||||||
| Distribution to shareholders | 4(46) | - | - | - | - | - | (1,188,301,851.36) | (1,188,301,851.36) | ||||||
| Balance at 30 June 2020 | 4,448,373,496.00 | 576,024,904.25 | 48,029,039,339.26 | (394,992,924.06) | 448,196,237.23 | 223,252,567.71 | 53,329,893,620.39 |
The accompanying notes form an integral part of these financial statements.
Legal representative: Principal in charge of accounting: Head of accounting department:
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
1 General information and historical development
S.F. Holding Co., Ltd. (formerly “Ma’anshan Dingtai Rare Earth and New Materials Co., Ltd.”,hereinafter “S.F. Holding” or “the Company”), formerly known as Ma’anshan Dingtai Science &Technology Co., Ltd., was established by 11 natural persons including Liu Jilu and the Labour Unionof Ma’anshan Dingtai Metallic Products Co., Ltd. by cash contribution on 13 May 2003. Initiated bythe original shareholders of the Company, the Company was formally changed as Ma’anshanDingtai Rare Earth and New Materials Co., Ltd. with a registered capital of RMB 50 million asapproved by the shareholders’ meeting on 18 October 2007 and the inaugural meeting on 22October 2007.
On 11 January 2010, the Company successfully issued 19,500,000 ordinary shares at par value ofRMB 1.00 per share at Shenzhen Stock Exchange under the Regulatory Permission [2010] No. 41as approved by the China Securities Regulatory Commission. The outstanding shares were listedfor trading at Shenzhen Stock Exchange on 5 February 2010. After the shares were issued, the totalshare capital of the Company was changed to 77,830,780 shares.
Pursuant to the Proposal on the Profit Distribution Plan for 2014 approved by 2014 annualshareholders’ meeting held by the Company on 19 May 2015, the Company converted capitalreserve into new shares on the basis of 5 shares for every 10 existing shares, with 77,830,780shares in total at the end of 2014 as base. After the conversion, the total share capital of theCompany was increased by 38,915,390 shares to 116,746,170 shares.
Pursuant to the Proposal on the Profit Distribution Plan for 2015 approved by the 2015 annualshareholders’ meeting held by the Company on 17 May 2016, the Company, with 116,746,170shares in total at the end of 2015 as base, converted capital reserve into new shares on the basis of10 shares for every 10 existing shares. After the conversion, the total share capital of the Companywas increased by 116,746,170 shares to 233,492,340 shares.
Pursuant to the resolution of the 13th session of the third Board of Directors of the Company dated22 May 2016 and relevant resolutions approved on the first interim shareholders’ meeting in 2016held by the Company on 30 June 2016, including the Resolution Concerning the CompanyQualifying for Criteria for Major Assets Restructuring of Listed Companies, the Resolution onRelated-party Transaction Composed of Major Assets Swap and Issuing Shares to Purchase Assetsand Raise Matching Fund and the Resolution on ‘Major Assets Swap and Issuing Shares toPurchase Assets and Raise Matching Fund and Related-party Transaction Report (Draft) ofMa’anshan Dingtai Rare Earth and New Materials Co., Ltd.’ and Summaries, the Companyconducted a series of major assets restructuring as follows:
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
1 General information and historical development (Cont’d)
(1) Major assets swap
In December 2016, the Company swapped all the assets and liabilities (“exchange-out assets”) itheld as at 31 December 2015 (“assessment base date”) for the equivalent portion (“exchange-inassets”) of 68.40%, 9.93%, 6.75%, 6.75%, 6.75%, 1.35% and 0.07% of the equities in ShenzhenS.F. Taisen Holdings (Group) Co., Ltd. (formerly “S.F. Holding (Group) Co., Ltd.”, “Taisen Holdings”)respectively held by Shenzhen Mingde Holdings Development Co., Ltd. (“Mingde Holdings”),Ningbo Shunda Fengrun Investment Management Partnership (Limited Partnership) (“ShundaFengrun”), Jiaqiang Shunfeng (Shenzhen) Equity Investment Partnership (Limited Partnership)(“Jiaqiang Shunfeng”), Shenzhen Zhaoguang Investment Co., Ltd. (“Zhaoguang Investment”),Suzhou Industrial Park Oriza Shunfeng Equity Investment Company (Limited Partnership) (“OrizaShunfeng”), Suzhou Guyu Qiuchuang Equity Investment Partnership (Limited Partnership) (“GuyuQiuchuang”) and Ningbo Shunxin Fenghe Investment Management Partnership (LimitedPartnership) (“Shunxin Fenghe”). For this transaction, the exchange-out assets were priced at RMB796 million and the exchange-in assets were priced at RMB 43.30 billion. Pursuant to the secondinterim shareholders’ meeting in 2016 dated 28 December 2016 (“restructuring date”), the Companyapproved and reelected a new Board of Directors, which indicated the completion of major assetsswap transaction and the successful listing of Taisen Holding on Shenzhen Stock Exchange throughback door listing.
(2) Issuing shares to purchase assets
In December 2016, the Company issued 3,950,185,873 ordinary shares (A shares) at par value ofRMB 1.00 per share at an issuing price of RMB 10.76 per share to Mingde Holding, ShundaFengrun, Jiaqiang Shunfeng, Zhaoguang Investment, Oriza Shunfeng, Guyu Qiu Chuang and ShunXin Feng He to cover the difference of the above swap (RMB 42,504,000,000). The differencebetween the value of shares and the share capital amounting to RMB 38,553,814,120.48 wasrecognised as capital reserve. The total share capital was changed to 4,183,678,213 shares. Afterthe new shares were issued, Mingde Holding, Shunda Fengrun, Jiaqiang Shunfeng, ZhaoguangInvestment, Oriza Shunfeng and other shareholders held 64.58%, 9.38%, 6.37%, 6.37%, 6.37%and 6.92% respectively of the equities in the Company. The China Securities RegulatoryCommission approved the above assets restructuring plan of the Company on 12 December 2016.The share change above was verified by PricewaterhouseCoopers Zhong Tian LLP with a capitalverification report of PwC ZT Yan Zi (2016) No. 1757 issued on 28 December 2016. The Companyregistered the additional 3.95 billion shares at China Securities Depository and the ClearingCorporation Limited Shenzhen Branch on 18 January 2017.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
1 General information and historical development (Cont’d)
(3) Raising matching fund
In July 2017, the Company issued 227,337,311 ordinary shares (A shares) at par value of RMB 1.00per share to specific investors through non-public offering at RMB 35.19 per share. The total fundraised amounted to RMB 7,999,999,974.09. Net of underwriter and sponsor’s fees and othertransaction costs, the net fund raised amounted to RMB 7,822,179,636.78, including an incrementof share capital of RMB 227,337,311.00 and an increment of capital reserve by RMB7,604,681,212.80. The aforesaid fund was received on 31 July 2017 and verified byPricewaterhouseCoopers Zhong Tian LLP with a capital verification report of PwC ZT Yan Zi (2017)No. 745 issued.
The Company registered the additional shares at China Securities Depository and the ClearingCorporation Limited Shenzhen Branch on 15 August 2017. The total share capital was changed to4,411,015,524 shares. Mingde Holdings, Shunda Feng Run, Jiaqiang Shunfeng, ZhaoguangInvestment, Oriza Shunfeng and other shareholders held 61.25%, 8.89%, 6.04%, 6.04%, 6.04%and 11.74% of the equities in the Company respectively.
Afterwards, the Company conducted several restricted shares incentive plans, share repurchaseand transfer of convertible corporate debentures to share capital. The total share capital of theCompany as at 30 June 2020 was changed to 4,448,373,496 shares.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
1 General information and historical development (Cont’d)
The approved business scope of the Company and its subsidiaries (“the Group”) includes: assetsmanagement, capital management, investment management (trusts, financial assets managementand security assets management are not allowed); auto rent (excluding auto rent with driver);enterprise headquarters management; customs brokerage, inspection brokerage; investment inindustries; domestic trade; marketing planning; investment consultancy and other informationconsultancy (excluding human resources intermediary service, securities and restricted projects);engagement in the development of network technology, information technology and electronicproduct technology and related technology services, consultancy and transfer of network technology,and provision of network information, E-Commerce service platform, business management,business investment, investment management consultancy, investment management, enterprisemanagement consulting, etc.; call centre business and information service (both are second typevalue-added telecommunication services) and road transportation of common cargo; internationalfreight forwarding for air transportation and road transportation of imported and exported goods ortransit goods, including solicitation, booking, shipping, warehousing and packaging; type-1 andtype-2 (international and domestic) sales agency of air transport; common cargo transportation,stowage and logistics services; science and technology information consulting, project investmentconsulting and logistics information consulting; data processing; research and development andsales of communication equipment, and related technology services (projects subject to approvalcould only be implemented after approval by relevant authorities), research and development ofunmanned aerial vehicle(“UAV”) and spare parts; supply chain management and related supportingservices, and engagement in both export and import business; development, construction andoperation of industrial park; property management; self-owned property leasing; network marketingpromotion; E-Commerce training; information technology outsourcing and information servicesoutsourcing; data mining, data analysis and data services; development and application of generalsoftware, industry application software and embedded software; operation of on-line trading, on-lineconsulting, on-line auction and on-line advertising; network business service and database service;services in respect of development and application of electronic government affairs system;communications industry value-added business services; international freight forwarding, domesticand international express (excluding business exclusively operated by postal enterprises),transportation of cargo shipping containers and large objects, economic and technical consulting,technical information consulting, and engagement in commercial activities by way of franchising;transport services of domestic (including Hong Kong, Macau and Taiwan) and international aviationcargo and related services, and import and export of goods and technology; cargo express agentservices; international freight forwarding (excluding shipping agency business), loading, unloadingand handling; international and domestic freight forwarding; technology development of softwareand hardware for financial payment systems; internet payment, bank card acquiring, supply chainmanagement; non-securities equity investment activities and relevant consulting services; financeleasing; leasing; purchase of leased property from home and abroad; residual value processing andmaintenance of leased property; leasing consulting; commercial factoring related to main operatingactivities; delivery of goods; freight equipment leasing; container yard operation and containerleasing service; railway cargo transportation; ship freight; product marketing design and planning forenterprises and individuals and related business agency services; non-vessel operating commoncarrier business; international maritime freight forwarding; financial information consulting, financialoutsourcing services commissioned by financial institutions, building construction engineering, andstorage and transportation of medicine, medical equipment and food; human resources service.
First-tier and second-tier subsidiaries included in the consolidation scope of the financial statementsare detailed in Note 6(1). The changes in the scope of consolidation for the current period are setout in Note 5.
Mingde Holdings was the parent company and ultimate controlling company of the Company.
These financial statements were authorised for issue by the Board of Directors of the Company on25 August 2020.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates
The Group determines the specific accounting policies and estimates based on its features ofproduction and operation, primarily comprising the methods of provision for expected credit losseson receivables (Note 2(9)), valuation of inventories (Note 2(10)), measurement model of investmentproperties (Note 2(12)), depreciation of fixed assets and amortisation of intangible assets (Note2(13), (16)), criterion for capitalisation of capitalised development expenditures (Note 2(17)),recognition and measurement of revenue (Note 2(25)), etc.
Details of the Group’s critical judgements used in determining significant accounting policies are setforth in Note 2(30).
(1) Basis of preparation
The financial statements are prepared in accordance with the Accounting Standards for BusinessEnterprises - Basic Standard, and the specific accounting standards and other relevant regulationsissued by the Ministry of Finance on 15 February 2006 and in subsequent periods (hereafter,referred to as “the Accounting Standards for Business Enterprises” or “CASs”) and the disclosurerequirements in the Preparation Convention of Information Disclosure by Companies OfferingSecurities to the Public No.15 - General Rules on Financial Reporting issued by the ChinaSecurities Regulatory Commission.
The financial statements are prepared on a going concern basis.
(2) Statement of compliance with the Accounting Standards for Business Enterprises
The financial statements of the Company for the six months ended 30 June 2020 are in compliancewith the Accounting Standards for Business Enterprises, and truly and completely present theconsolidated and company financial position of the Company as at 30 June 2020 and their financialperformance, cash flows and other information for the period then ended.
(3) Accounting year
The Company’s accounting year starts on 1 January and ends on 31 December.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(4) Recording currency
The Company’s recording currency is Renminbi (RMB). The Company’s subsidiaries decide theirrecording currencies in line with the economic environments in which they operate, while thesubsidiaries in Hong Kong and abroad mainly adopt currencies including HKD, USD, KRW, EUR,etc. as their recording currencies. The financial statements are presented in RMB.
(5) Business combinations
(a) Business combinations involving enterprises under common control
The consideration paid and net assets obtained by the acquirer in a business combination aremeasured at the carrying amount. If the acquiree is acquired from a third party by the ultimatecontrolling party in a prior year, the consideration paid and net assets obtained by the acquirer aremeasured based on the carrying amounts of the acquiree’s assets and liabilities (including thegoodwill arising from the acquisition of the acquiree by the ultimate controlling party) presented inthe consolidated financial statements of the ultimate controlling party. The difference between thecarrying amount of the net assets obtained from the combination and the carrying amount of theconsideration paid for the combination is treated as an adjustment to capital reserve (sharepremium). If the capital reserve (share premium) is not sufficient to absorb the difference, theremaining balance is adjusted against retained earnings. Costs directly attributable to the businesscombination are included in profit or loss in the period in which they are incurred. Transaction costsassociated with the issue of equity or debt securities for the business combination are included inthe initially recognised amounts of the equity or debt securities.
(b) Business combinations involving enterprises not under common control
The combination cost and identifiable net assets obtained by the acquirer in a business combinationare measured at fair value at the acquisition date. Where the combination cost exceeds theacquirer’s interest in the fair value of the acquiree’s identifiable net assets, the difference isrecognised as goodwill; where the combination cost is lower than the acquirer’s interest in the fairvalue of the acquiree’s identifiable net assets, the difference is recognised in profit or loss for thecurrent period. Costs directly attributable to the combination are included in profit or loss in theperiod in which they are incurred. Transaction costs associated with the issue of equity or debtsecurities for the business combination are included in the initially recognised amounts of the equityor debt securities.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(6) Preparation of consolidated financial statements
The consolidated financial statements comprise the financial statements of the Company and all ofits subsidiaries.
Subsidiaries are consolidated from the date on which the Group obtains control and arede-consolidated from the date on which such control ceases. For a subsidiary that is acquired in abusiness combination involving enterprises under common control, it is included in the consolidatedfinancial statements from the date when it, together with the Company, comes under commoncontrol of the ultimate controlling party. The portion of the net profits realised before the combinationdate is presented separately in the consolidated income statement.
In preparing the consolidated financial statements, where the accounting policies and theaccounting periods of the Company and subsidiaries are inconsistent, the financial statements ofthe subsidiaries are adjusted in accordance with the accounting policies and the accounting periodof the Company. For subsidiaries acquired from business combinations involving enterprises notunder common control, the individual financial statements of the subsidiaries are adjusted based onthe fair value of the identifiable net assets at the acquisition date.
All significant intra-group balances, transactions and unrealised profits are eliminated in theconsolidated financial statements. The portion of subsidiaries’ equity and the portion of subsidiaries’net profit or loss and comprehensive income for the period not attributable to the Company arerecognised as minority interests, minority interest income and total comprehensive incomeattributable to minority shareholders and presented separately in the consolidated financialstatements under equity, net profit and total comprehensive income respectively. Unrealised profitsand losses resulting from the sale of assets by the Company to its subsidiaries are fully eliminatedagainst net profit attributable to owners of the parent. Unrealised profits and losses resulting fromthe sale of assets by a subsidiary to the Company are eliminated and allocated between net profitattributable to owners of the parent and minority interest income in accordance with the allocationproportion of the parent in the subsidiary. Unrealised profits and losses resulting from the sale ofassets by one subsidiary to another are eliminated and allocated between net profit attributable toowners of the parent and minority interest income in accordance with the allocation proportion of theparent in the selling subsidiary.
If the accounting treatment of a transaction is inconsistent in the financial statements at the Grouplevel and at the Company or its subsidiary level, adjustment will be made from the perspective of theGroup.
(7) Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, deposits that can be readily drawn on demand,and short-term and highly liquid investments that are readily convertible to known amounts of cashand which are subject to an insignificant risk of changes in value.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(8) Foreign currency translation
(a) Foreign currency transactions
Foreign currency transactions are translated into recording currency using the spot exchange ratesand approximate exchange rates prevailing at the dates of the transactions.
At the balance sheet date, monetary items denominated in foreign currencies are translated intorecording currency using the spot exchange rates on the balance sheet date. Exchange differencesarising from these translations are recognised in profit or loss for the current period, except for thoseattributable to foreign currency borrowings that have been taken out specifically for acquisition orconstruction of qualifying assets, which are capitalised as part of the cost of those assets.Non-monetary items denominated in foreign currencies that are measured at historical costs aretranslated at the balance sheet date using the spot exchange rates at the date of the transactions.The effect of exchange rate changes on cash is presented separately in the cash flow statement.
(b) Translation of foreign currency financial statements
The asset and liability items in the balance sheets for overseas operations are translated at the spotexchange rates on the balance sheet date. Among the equity items, the items other than retainedearnings are translated at the spot exchange rates of the transaction dates. The income andexpense items in the income statement of foreign operations are translated at the spot exchangerates of the transaction dates. The differences arising from the above translation are recognised inother comprehensive income. The cash flows of foreign operations are translated at the spotexchange rates on the dates of the cash flows. The effect of exchange rate changes on cash ispresented separately in the cash flow statement.
(9) Financial instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financialliability or equity instrument of another entity. A financial asset or a financial liability is recognisedwhen the Group becomes a party to the contractual provisions of the instrument.
(a) Financial assets
(i) Classification and measurement
Based on the business model for managing the financial assets and the contractual cash flowcharacteristics of the financial assets, financial assets are classified as: (1) financial assets atamortised cost; (2) financial assets at fair value through other comprehensive income; (3) financialassets at fair value through profit or loss.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(9) Financial instruments (Cont’d)
(a) Financial assets (Cont’d)
(i) Classification and measurement (Cont’d)
The financial assets are measured at fair value at initial recognition. Related transaction costs thatare attributable to the acquisition of the financial assets are included in the initially recognisedamounts, except for the financial assets at fair value through profit or loss, the related transactioncosts of which are recognised directly in profit or loss for the current period. Accounts receivable ornotes receivable arising from sales of products or rendering of services (excluding or without regardto significant financing components) are initially recognised at the consideration that is entitled to becharged by the Group as expected.
Debt instruments
The debt instruments held by the Group refer to the instruments that meet the definition of financialliabilities from the perspective of the issuer, and are measured in the following ways:
Measured at amortised cost:
The objective of the Group’s business model is to hold the financial assets to collect the contractualcash flows, and the contractual cash flow characteristics are consistent with a basic lendingarrangement, which gives rise on specified dates to the contractual cash flows that are solelypayments of principal and interest on the principal amount outstanding. The interest income of suchfinancial assets is recognised using the effective interest method. Such financial assets mainlycomprise cash at bank and on hand, placements with and loans to banks and other financialinstitutions, notes receivable, accounts receivable, factoring receivables, loans and advances, otherreceivables and long-term receivables. Long-term receivables that are due within one year(inclusive) as from the balance sheet date are included in the current portion of non-current assets.
Measured at fair value through profit or loss:
Debt instruments held by the Group that are not divided into those at amortised cost, or thosemeasured at fair value through other comprehensive income, are measured at fair value throughprofit or loss and included in financial assets held for trading. At initial recognition, the Groupdesignates a portion of financial assets as at fair value through profit or loss to eliminate orsignificantly reduce an accounting mismatch. Financial assets that are due within one year(inclusive) as from the balance sheet date and are expected to be held over one year are included inother non-current financial assets.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(9) Financial instruments (Cont’d)
(a) Financial assets (Cont’d)
(i) Classification and measurement (Cont’d)
Equity instruments
Investments in equity instruments, over which the Group has no control, joint control or significantinfluence, are measured at fair value through profit or loss under financial assets held for trading;investments in equity instruments expected to be held over one year as from the balance sheet dateare included in other non-current financial assets.
In addition, a portion of certain investments in equity instruments not held for trading are designatedas financial assets at fair value through other comprehensive income under other investments inequity instruments. The relevant dividend income of such financial assets is recognised in profit orloss for the current period.
(ii) Impairment
The Group confirms the loss provision based on expected credit losses for financial assets andcontract assets measured at amortised cost.
Giving consideration to reasonable and supportable information on past events, current conditionsand forecasts of future economic conditions, as well as the default risk weight, the Group recognisesthe expected credit loss as the probability-weighted amount of the present value of the differencebetween the cash flows receivable from the contract and the cash flows expected to collect.
As at each balance sheet date, the expected credit losses of financial instruments at different stagesare measured respectively. 12-month expected credit loss provision is recognised for financialinstruments in Stage 1 that have not had a significant increase in credit risk since initial recognition;lifetime expected credit loss provision is recognised for financial instruments in Stage 2 that havehad a significant increase in credit risk yet without credit impairment since initial recognition; andlifetime expected credit loss provision is recognised for financial instruments in Stage 3 that havehad credit impairment since initial recognition.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(9) Financial instruments (Cont’d)
(a) Financial assets (Cont’d)
(ii) Impairment (Cont’d)
For the financial instruments with lower credit risk on the balance sheet date, the Group assumesthere is no significant increase in credit risk since initial recognition and recognises the 12-monthexpected credit loss provision.
For the financial instruments in Stage 1, Stage 2 and with lower credit risk, the Group calculates theinterest income by applying the effective interest rate to the gross carrying amount (beforededuction of the impairment provision). For the financial instruments in Stage 3, the interest incomeis calculated by applying the effective interest rate to the amortised cost (after deduction of theimpairment provision from the gross carrying amount).
For notes and accounts receivables and contract assets, the Group recognises the lifetimeexpected credit loss provision regardless of whether there exists a significant financing component.
In case the expected credit losses of an individually assessed financial asset cannot be evaluatedwith reasonable cost, the Group divides the receivables into certain groupings based on credit riskcharacteristics, and calculates the expected credit losses for the groupings. Basis for determinedgroupings and method for provision are as follows:
| Bank acceptance notes | Group of bank notes with low credit risk |
| Accounts receivable, other receivables | Group of receivables from related parties |
| Accounts receivable, other receivables and contract assets | Group of receivables from non-related parties |
| Long-term receivables | Group of interest-free loans to employees |
Based on the exposure at default and the lifetime expected credit loss rate, the Group calculates theexpected credit losses of notes and accounts receivables and contract assets that are classified intogroupings with consideration to historical credit losses experience, current conditions and forecastsof future economic conditions.
Based on the exposure at default and the 12-month/lifetime expected credit loss rate, the Groupcalculates the expected credit losses of other receivables, factoring receivables, loans andadvances, and long-term receivables that are classified into groupings with consideration tohistorical credit losses experience, the current conditions and forecasts of future economicconditions.
The Group recognises the loss provision made or reversed into profit or loss for the current period.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(9) Financial instruments (Cont’d)
(a) Financial assets (Cont’d)
(iii) Derecognition
A financial asset is derecognised when any of the below criteria is met: (1) the contractual rights toreceive the cash flows from the financial asset expire; (2) the financial asset has been transferredand the Group transfers substantially all the risks and rewards of ownership of the financial asset tothe transferee; or (3) the financial asset has been transferred and the Group has not retained controlof the financial asset, although the Group neither transfers nor retains substantially all the risks andrewards of ownership of the financial asset.
When a financial asset is derecognised, the difference between the carrying amount and the sum ofthe consideration received and the cumulative changes in fair value that are previously recogniseddirectly in other comprehensive income is recognised in profit or loss for the current period, exceptfor those as investments in other equity instruments, the difference aforementioned is recognised inretained earnings instead.
(b) Financial liabilities
Financial liabilities are classified as financial liabilities at amortised cost and financial liabilities at fairvalue through profit or loss at initial recognition.
Financial liabilities of the Group mainly comprise financial liabilities at amortised cost, includingconvertible corporate debentures and other financial liabilities.
Convertible corporate debentures
Convertible corporate debentures comprise liability portion and equity portion. The liability portion isclassified as liabilities, which reflects the obligation to pay fixed principal and interest, and its fairvalue is calculated by the market interest rate of similar debentures without embedded convertibleoption at initial recognition, and is subsequently measured at amortised cost using the effectiveinterest method. The equity portion reflects the embedded option that converts liabilities intoordinary shares and is recognised as equity by the difference between the overall proceeds ofissuance of convertible corporate debentures and the liability portion. Direct transaction costs areallocated based on the shares of the liability portion and the equity portion in issuance proceeds.
When convertible corporate debentures are converted into stock shares, the amount calculated bythe number of shares converted and the par value per share is recognised as share capital, and thedifference between the balance of relevant portion of convertible corporate debentures and theabove share capital is recognised as share premium in capital reserve.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(9) Financial instruments (Cont’d)
(b) Financial liabilities (Cont’d)
Other financial liabilities
Other financial liabilities measured at amortised cost mainly comprise notes and accounts payables,other payables, borrowings, other debentures payable except for convertible corporate debentures,etc. Such financial liabilities are initially recognised at fair value, net of transaction costs incurred,and subsequently measured using the effective interest method. Financial liabilities that are duewithin one year (inclusive) are classified as current liabilities; those with maturities over one year butare due within one year (inclusive) as from the balance sheet date are classified as current portion ofnon-current liabilities. Others are classified as non-current liabilities.
A financial liability is derecognised or partly derecognised when the underlying present obligation isdischarged or partly discharged. The difference between the carrying amount of the derecognisedpart of the financial liability and the consideration paid is recognised in profit or loss for the currentperiod.
(c) Determination of fair value of financial instruments
The fair value of a financial instrument that is traded in an active market is determined at the quotedprice in the active market. The fair value of a financial instrument that is not traded in an activemarket is determined by using a valuation technique. In valuation, the Group adopts valuationtechniques applicable in the current situation and supported by adequate available data and otherinformation, selects inputs with the same characteristics as those of assets or liabilities consideredin relevant transactions of assets or liabilities by market participants, and gives priority to the use ofrelevant observable inputs. When relevant observable inputs are not available or feasible,unobservable inputs are adopted.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(10) Inventories
(a) Classification
Inventories comprise low-value consumables, raw materials in stock, finished goods, aviationconsumables and properties under development, and are stated at the lower of cost and netrealisable value.
(b) Valuation method for inventory issued
Raw materials in stock and finished goods are accounted for using the weighted average methodupon issuance. Aviation consumables are accounted for using the specific-unit-cost method uponissuance. Properties under development comprise land costs relating to real estate development,construction costs, other direct and indirect development expenses, etc., and are transferred tocompleted properties held for sale at actual cost upon completion.
(c) Amortisation methods of low-value consumables
Low-value consumables are amortised into expenses in full when issued for use.
(d) Basis for determining the net realisable value of inventories and provision for decline in the value of
inventories
Provision for decline in the value of inventories is determined at the excess amount of the carryingamounts of the inventories over their net realisable value. Net realisable value is determined basedon the estimated selling price in the ordinary course of business, less the estimated costs andestimated costs necessary to make the sale and related taxes.
(e) The Group adopts the perpetual inventory system.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(11) Long-term equity investments
Long-term equity investments comprise the Company’s long-term equity investments in itssubsidiaries, and the Group’s long-term equity investments in its joint ventures and associates.
A subsidiary is an investee over which the Company is able to exercise control. A joint venture is ajoint arrangement which is structured through a separate vehicle over which the Group has jointcontrol together with other parties and only has rights to the net assets of the arrangement based onlegal forms, contractual terms and other facts and circumstances. An associate is the investee overwhich the Group has significant influence by participating in the financial and operating policydecisions.
Investments in subsidiaries are presented in the Company’s financial statements using the costmethod, and are adjusted to the equity method when preparing the consolidated financialstatements, and investments in joint ventures and associates are accounted for using the equitymethod.
(a) Determination of investment cost
For long-term equity investments arising from business combination: for long-term equityinvestments arising from business combination involving enterprises under common control, theinitial investment cost shall be the share of the carrying amount of equity of the acquiree in theconsolidated financial statements of the ultimate controlling party as at the combination date; forlong-term equity investments arising from business combination involving enterprises not undercommon control, the investment cost shall be the combination cost.
For long-term equity investments acquired not through a business combination: for long-term equityinvestments acquired by payment in cash, the initial investment cost shall be the purchase priceactually paid; for long-term equity investments acquired by issuing equity securities, the initialinvestment cost shall be the fair value of the equity securities issued.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(11) Long-term equity investments (Cont’d)
(b) Subsequent measurement and recognition methods of gains and losses
Long-term equity investments accounted for using the cost method are measured at the initialinvestment cost. Cash dividend or profit distribution declared by an investee is recognised asinvestment income in profit or loss for the current period.
For long-term equity investments that are accounted for using the equity method, where the initialinvestment cost exceeds the Group’s share of the fair value of the investee’s identifiable net assetsat the time of acquisition, the investment is initially measured at cost. Where the initial investmentcost is less than the Group’s share of the fair value of the investee’s identifiable net assets at thetime of acquisition, the difference is included in profit or loss for the current period and the cost of thelong-term equity investment is adjusted upwards accordingly.
Under the equity method, the Group recognises the investment income according to its share of netprofit or loss of the investee. The Group discontinues recognising its share of the net losses of aninvestee after the carrying amounts of the long-term equity investment together with any long-terminterests that in substance form part of the investor’s net investment in the investee are reduced tozero. However, if the Group has obligations for additional losses and the criteria with respect torecognition of provisions are satisfied, the Group continues recognising the estimated losses that itneeds to bear. The changes of the Group’s share of the investee’s equity other than those arisingfrom the net profit or loss, other comprehensive income and profit appropriation, are recognised inthe Group’s capital reserve and the carrying amounts of the long-term equity investment areadjusted accordingly. The carrying amount of the investment is reduced by the Group’s share of theprofit distribution or cash dividends declared by an investee. The unrealised profits or losses arisingfrom the transactions between the Group and its investees are eliminated in proportion to theGroup’s equity interest in the investees, based on which the investment gain or losses arerecognised. For the loss on the intra-group transaction amongst the Group and its investeesattributable to asset impairment losses, any unrealised loss is not eliminated.
(c) Basis for determining existence of control, joint control, significant influence over investees
Control means having power over an investee, enjoying variable returns through involvement inrelevant activities of the investee, and being able to impact the amount of such variable returns byusing the power over the investee.
Joint control is the agreed sharing of control over an arrangement, and the decision of activitiesrelating to such arrangement requires the unanimous consent of the Group and other partiessharing control.
Significant influence is the power to participate in making the decisions on financial and operatingpolicies of the investee, but is not control or joint control over making those policies.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(11) Long-term equity investments (Cont’d)
(d) Impairment of long-term equity investments
The carrying amounts of long-term equity investments in subsidiaries, joint ventures and associatesare reduced to the recoverable amounts when the recoverable amounts are below their carryingamounts (Note 2(19)).
(12) Investment properties
Investment properties, including land use rights that have already been leased out, buildings thatare held for the purpose of leasing and buildings that are being constructed or developed for futureuse for leasing, are measured initially at cost. Subsequent expenditures incurred in relation to aninvestment property are included in the cost of the investment property when it is probable that theassociated economic benefits will flow to the Group and their costs can be reliably measured;otherwise, the expenditures are recognised in profit or loss for the period in which they are incurred.
The Group adopts the cost model for subsequent measurement of investment properties. Buildingsand land use rights are depreciated or amortised to their estimated net residual values over theirestimated useful lives. The estimated useful lives, the estimated net residual values that areexpressed as a percentage of cost and the annual depreciation rates of investment properties areas follows:
| Estimated useful lives | Estimated net residual values | Annual depreciation/ Amortisation rates | |
| Buildings | 10 to 50 years | 5% | 9.50% - 1.90% |
| Land use rights | 20 to 50 years | 0% | 5.00% - 2.00% |
The investment property’s estimated useful life, net residual value and depreciation (amortisation)method applied are reviewed and adjusted as appropriate at each year-end.
An investment property is derecognised on disposal or when the investment property is permanentlywithdrawn from use and no future economic benefits are expected from its disposal. The net amountof proceeds from sale, transfer, retirement or damage of an investment property net of its carryingamount and related taxes and expenses is recognised in profit or loss for the current period.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(13) Fixed assets
(a) Recognition and initial measurement of fixed assets
Fixed assets comprise buildings, motor vehicles, computers and electronic equipment, aircraft andaircraft engines, rotables and high-value aircraft maintenance tools, machinery and equipment,office equipment and other equipment.
Fixed assets are recognised when it is probable that the associated economic benefits will flow tothe Group and the related cost can be reliably measured. Fixed assets purchased or constructedare initially measured at cost at the time of acquisition.
Subsequent expenditures incurred for a fixed asset are included in the cost of the fixed asset whenit is probable that the associated economic benefits will flow to the Group and the related cost canbe reliably measured. The carrying amount of the replaced part is derecognised. All the othersubsequent expenditures are recognised in profit or loss for the period in which they are incurred.
(b) Depreciation method for fixed assets
Except for replacement parts for overhaul of engine, fixed assets are depreciated using thestraight-line method to allocate the recorded amount of the assets to their estimated residual valuesover their estimated useful lives. For the fixed assets that have been provided for impairment loss,the related depreciation charge is prospectively determined based upon the adjusted carryingamounts over their remaining useful lives.
The estimated useful lives and the estimated net residual values expressed as a percentage of costand the annual depreciation rates of fixed assets are as follows:
| Estimated useful lives | Estimated net residual values | Annual depreciation rates | |
| Buildings | 10 to 50 years | 5% | 9.50% - 1.90% |
| Motor vehicles (excluding electromobiles) | 2 to 5 years | 0% - 5% | 50.00% - 19.00% |
| Motor vehicles (electromobiles) | 2 years | 5% | 47.50% |
| Machinery and equipment (excluding automatic sorting equipment imported from abroad) | 2 to 10 years | 0% - 5% | 50.00% - 9.50% |
| Machinery and equipment (automatic sorting equipment imported from abroad) | 15 years | 5% | 6.33% |
| Computers and electronic equipment | 2 to 5 years | 0% - 5% | 50.00% - 19.00% |
| Aircraft and engine bodies | 10 years | 5% | 9.50% |
| Replacement parts for overhaul of aircraft fuselage | 1.5 to 12 years | 0% | 66.67% - 8.33% |
| Rotables | 10 years | 5% | 9.50% |
| High-value aircraft maintenance tools | 5 years | 5% | 19.00% |
| Office equipment and other equipment | 2 to 10 years | 0% - 5% | 50.00% - 9.50% |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(13) Fixed assets (Cont’d)
(b) Depreciation method for fixed assets (Cont'd)
Replacement parts for overhaul of engines are depreciated using the units-of-production methodand taking the expected usable recurring number as the unit of production.
The estimated useful life/expected usable recurring number and the estimated net residual value ofa fixed asset and the depreciation method applied to the asset are reviewed, and adjusted asappropriate at each year-end.
(c) The carrying amounts of fixed assets are reduced to the recoverable amounts when the recoverable
amounts are below their carrying amounts (Note 2(19)).
(d) Basis for identification of fixed assets held under finance leases and related measurement
A finance lease is a lease that transfers substantially all the risks and rewards incidental toownership of an asset. The leased asset is recognised at the lower of the fair value of the leasedasset and the present value of the minimum lease payments. The difference between the recordedamount of the leased asset and the minimum lease payments is accounted for as unrecognisedfinance charge (Note 2(28)(b)).
Fixed assets held under a finance lease is depreciated on a basis consistent with the depreciationpolicy adopted for fixed assets that are self-owned. When a leased asset can be reasonablydetermined that its ownership will be transferred at the end of the lease term, it is depreciated overits estimated useful life; otherwise, the leased asset is depreciated over the shorter period of thelease term and its estimated useful life.
(e) Disposal of fixed assets
A fixed asset is derecognised on disposal or when no future economic benefit is expected from itsuse or disposal. The amount of proceeds from disposals on sale, transfer, retirement or damage of afixed asset net of its carrying amount and related taxes and expenses is recognised in profit or lossfor the current period.
(14) Construction in progress
Construction in progress is measured at actual cost. Actual cost comprises construction costs,installation costs, borrowing costs that are eligible for capitalisation and other costs necessary tobring the fixed assets ready for their intended use. Construction in progress is transferred to fixedassets when the assets are ready for their intended use, and depreciation begins from the followingmonth. The carrying amount of construction in progress is reduced to the recoverable amount whenthe recoverable amount is below its carrying amount (Note 2(19)).
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(15) Borrowing costs
The Group’s borrowing costs that are directly attributable to the acquisition and construction of afixed asset that needs a substantially long period of time for its intended use commence to becapitalised and recorded as part of the cost of the asset when expenditures for the asset andborrowing costs have been incurred, and the activities relating to the acquisition and constructionthat are necessary to prepare the asset for its intended use have commenced. The capitalisation ofborrowing costs ceases when the asset under acquisition or construction becomes ready for itsintended use and the borrowing costs incurred thereafter are recognised in profit or loss for thecurrent period. Capitalisation of borrowing costs is suspended during periods in which theacquisition or construction of a fixed asset is interrupted abnormally and the interruption lasts formore than 3 months, until the acquisition or construction is resumed.
For the specific borrowings obtained for the acquisition or construction of an asset qualifying forcapitalisation, the amount of borrowing costs eligible for capitalisation is determined by deductingany interest income earned from depositing the unused specific borrowings in the banks or anyinvestment income arising on the temporary investment of those borrowings during thecapitalisation period.
For general borrowings utilised for the acquisition and construction of an asset qualifying forcapitalisation, the capitalised amount of the general borrowings is determined by the weightedaverage of the excess of accumulated capital expenditure over capital expenditure of the specialborrowings multiplied by the weighted average effective interest rate of the utilised generalborrowings. The effective interest rate is the interest rate at which the future cash flows of theborrowings over the estimated life or a shorter applicable period are discounted into the initialrecognised amount of the borrowings.
(16) Intangible assets
Intangible assets include software, land use rights, trademark rights, customer relationships, patents,etc.
(a) Software
Software is measured at actual cost and amortised on the straight-line basis over 2 to 10 years.
(b) Land use rights
Land use rights are amortised on the straight-line basis over 33 to 50 years.
(c) Trademark rights
Purchased trademark rights are measured at cost at the time of acquisition. Trademark rightsrecognised under business combinations involving enterprises not under common control arerecorded at fair value. Trademark rights are amortised on the straight-line basis over 5 to 20 years.
(d) Customer relationships
Customer relationships refer to intangible assets recognised under business combinations involvingenterprises not under common control. Customer relationships are recorded at fair value andamortised on the straight-line basis over the expected beneficial period.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(16) Intangible assets (Cont’d)
(e) Patents
Patents are amortised on the straight-line basis over 5 to 10 years.
(f) Periodical review of useful life and amortisation method
For an intangible asset with a finite useful life, review of its useful life and amortisation method isperformed at each year-end, with adjustment made as appropriate.
(g) Impairment of intangible assets
The carrying amounts of intangible assets are reduced to the recoverable amounts when therecoverable amounts are below their carrying amounts (Note 2(19)).
(17) Research and development
The expenditure on an internal research and development project is classified into expenditure onthe research phase and expenditure on the development phase based on its nature and whetherthere is material uncertainty that the research and development activities can form an intangibleasset at end of the project.
Expenditure on the research phase is recognised in profit or loss in the period in which it is incurred.Expenditure on the development phase is capitalised only if all of the following conditions aresatisfied:
? it is technically feasible to complete the intangible asset so that it will be available for use or
sales;? management intends to complete the intangible asset, and use or sell it;? it can be demonstrated how the intangible asset will generate economic benefits;? there are adequate technical, financial and other resources to complete the development
and the ability to use or sell the intangible asset; and? the expenditure attributable to the intangible asset during its development phase can be
reliably measured.
Other development expenditures that do not meet the conditions above are recognised in profit orloss in the period in which they are incurred. Capitalised development expenditures previouslyrecognised as expenses are not recognised as an asset in a subsequent period. Capitalisedexpenditure on the development phase is presented as capitalised development expenditures in thebalance sheet and transferred to intangible assets at the date when the asset is ready for itsintended use.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(18) Long-term prepaid expenses
Long-term prepaid expenses include settling-in allowance and introduction fee for pilots, theexpenditure for improvements to fixed assets held under operating leases, and other expendituresthat have been incurred but should be recognised as expenses over more than one year in thecurrent and subsequent periods. Long-term prepaid expenses are amortised on a straight-line basisover the expected beneficial period (2 to 15 years) and are presented at actual expenditure net ofaccumulated amortisation.
(19) Impairment of long-term assets
Fixed assets, construction in progress, intangible assets with finite useful lives, investmentproperties measured using the cost model and long-term equity investments in subsidiaries, jointventures and associates are tested for impairment if there is any indication that the assets may beimpaired at the balance sheet date; intangible assets not ready for their intended use are tested atleast annually for impairment, irrespective of whether there is any indication that it may be impaired.If the result of the impairment test indicates that the recoverable amount of an asset is less than itscarrying amount, a provision for impairment and an impairment loss are recognised for the amountby which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount isthe higher of an asset’s fair value less costs to sell and the present value of the future cash flowsexpected to be derived from the asset. Provision for asset impairment is determined and recognisedon individual asset basis. If it is not possible to estimate the recoverable amount of an individualasset, the recoverable amount of a group of assets to which the asset belongs is determined. Agroup of assets is the smallest group of assets that is able to generate independent cash inflows.
Goodwill that is separately presented in the financial statements is tested at least annually forimpairment, irrespective of whether there is any indication that it may be impaired. In conducting thetest, the carrying amount of goodwill is allocated to the related asset groups or sets of asset groupswhich are expected to benefit from the synergies of the business combination. If the result of the testindicates that the recoverable amount of an asset group or a set of asset groups, including theallocated goodwill, is lower than its carrying amount, the corresponding impairment loss isrecognised. The impairment loss is first deducted from the carrying amount of goodwill that isallocated to the asset group or the set of asset groups, and then deducted from the carryingamounts of other assets within the asset group or the set of asset groups in proportion to thecarrying amounts of assets other than goodwill.
Once the above asset impairment loss is recognised, it will not be reversed for the value recoveredin the subsequent periods.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(20) Employee benefits
Employee benefits refer to all forms of consideration or compensation given by the Group inexchange for service rendered by employees or for termination of employment relationship, whichinclude short-term employee benefits, post-employment benefits, termination benefits and otherlong-term employee benefits.
(a) Short-term employee benefits
Short-term employee benefits include employee wages or salaries, bonus, allowances andsubsidies, staff welfare, premiums or contributions on medical insurance, work injury insurance andmaternity insurance, housing funds, union running costs and employee education costs. Theemployee benefit liabilities are recognised in the accounting period in which the service is renderedby the employees, with a corresponding charge to the profit or loss for the current period or the costof relevant assets. Employee benefits which are non-monetary benefits are measured at fair value.
(b) Post-employment benefits
The Group classifies post-employment benefits plans into defined contribution plans and definedbenefit plans. Defined contribution plans are post-employment benefit plans under which the Grouppays fixed contributions into a separate fund and will have no obligation to pay further contributions;and defined benefit plans are post-employment benefit plans other than defined contribution plans.During the reporting period, the Group’s post-employment benefits mainly included basic pensioninsurance and unemployment insurance, both of which belong to defined contribution plans.
Basic pension insurance
The Group’s employees participate in the basic pension plan set up and administered by localauthorities of Ministry of Human Resource and Social Security. Monthly payments of premiums onthe pensions are calculated according to local regulations for pension plan. When employees retire,the local labour and social security authority is obliged to pay the basic pensions to them. Theamounts based on the above calculations are recognised as liabilities in the accounting period inwhich the service has been rendered by the employees, with a corresponding charge to the profit orloss for the current period or the cost of relevant assets.
(c) Termination benefits
The Group provides compensation for terminating the employment relationship with employeesbefore the end of the employment contracts or as an offer to encourage employees to acceptvoluntary redundancy before the end of the employment contracts. The Group recognises a liabilityarising from compensation for termination of the employment relationship with employees, with acorresponding charge to profit or loss for the current period at the earlier of the following dates: 1)when the Group cannot unilaterally withdraw an employment termination plan or a curtailmentproposal; 2) when the Group recognises costs or expenses related to a restructuring that involvesthe payment of termination benefits.
The termination benefits expected to be settled within one year since the balance sheet date areclassified as current liabilities.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(20) Employee benefits (Cont'd)
(d) Employee incentives
The Group provides incentive plans for on-the-job employees who comply with certain conditions,and makes payments based on the schedule. Provisions for employee incentives are initiallymeasured at the best estimate necessary to settle the present obligation, and expensed as incurred.The Group integrates separation rate, time value of money and other factors into account at initialmeasurement. Where the effect of the time value of money is material, the best estimate isdetermined by discounting the related future cash outflows. The increase in the discounted amountof the provision arising from passage of time is expensed as incurred. The carrying amount ofprovisions for employee incentives is reviewed at each balance sheet date and adjusted to reflectthe current best estimate.
(21) Deferred tax assets and deferred tax liabilities
Deferred tax assets and deferred tax liabilities are calculated and recognised based on thedifferences arising between the tax bases of assets and liabilities and their carrying amounts(temporary differences). Deferred tax asset is recognised for the deductible tax losses that can becarried forward to subsequent years for deduction of the taxable profit in accordance with the taxlaws. No deferred tax liability is recognised for a temporary difference arising from the initialrecognition of goodwill. No deferred tax asset or deferred tax liability is recognised for the temporarydifferences resulting from the initial recognition of assets or liabilities due to a transaction other thana business combination, which affects neither accounting profit nor taxable profit (or deductible taxlosses). At the balance sheet date, deferred tax assets and deferred tax liabilities are measured atthe tax rates that are expected to apply to the period when the asset is realised or the liability issettled.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(21) Deferred tax assets and deferred tax liabilities (Cont’d)
Deferred tax assets are only recognised for deductible temporary differences, deductible tax lossesand tax credits to the extent that it is probable that taxable profit will be available in the futureagainst which the deductible temporary differences, deductible tax losses and tax credits can beutilised.
Deferred tax liabilities are recognised for temporary differences arising from investments insubsidiaries, associates and joint ventures, except where the Group is able to control the timing ofreversal of the temporary difference, and it is probable that the temporary difference will not reversein the foreseeable future. When it is probable that the temporary differences arising frominvestments in subsidiaries, associates and joint ventures will be reversed in the foreseeable futureand that the taxable profit will be available in the future against which the temporary differences canbe utilised, the corresponding deferred tax assets are recognised.
Deferred tax assets and deferred tax liabilities are offset when:
? the deferred tax assets and liabilities are related to the same tax payer within the Group and
the same taxation authority; and,? that tax payer within the Group has a legally enforceable right to offset current tax assets
against current tax liabilities.
(22) Provisions
Provisions are recognised when the Group has a present obligation, it is probable that an outflow ofeconomic benefits will be required to settle the obligation, and the amount of the obligation can bemeasured reliably.
A provision is initially measured at the best estimate of the expenditure required to settle the relatedpresent obligation. Factors surrounding a contingency, such as the risks, uncertainties and the timevalue of money, are taken into account as a whole in reaching the best estimate of a provision.Where the effect of the time value of money is material, the best estimate is determined bydiscounting the related future cash outflows. The increase in the discounted amount of the provisionarising from passage of time is recognised as interest expense.
The carrying amount of provisions is reviewed at each balance sheet date and adjusted to reflectthe current best estimate.
The provisions expected to be settled within one year since the balance sheet date are classified asother current liabilities.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(23) Share-based payments
(a) Categories of share-based payments
A share-based payment is a transaction in which an enterprise grants equity instruments orassumes liabilities that are determined based on equity instruments, in exchange for servicesrendered by employees or another party. Equity instruments include the equity instruments that arelinked to the enterprise, the parent company of the enterprise or another accounting entity within thesame group. Share-based payments comprise equity-settled and cash-settled payments.
(b) Basis for determining the best estimate of exercisable equity instruments
At each balance sheet date in the vesting period, the Group would make best estimate in
accordance with the newly acquired information such as changes in the number of employeesentitled to equity instruments, and amend the number of exercisable equity instruments. On theexercisable date, the ultimate estimated number of exercisable equity instruments coincides withthe actual number.
(c) Accounting treatment of implementation of share-based payments
(i) Equity-settled share-based payments
The equity-settled share-based payments where the Group grants shares or other equity
instruments as a consideration in return for services, is measured at the fair value of the equityinstruments at the grant date. Where the share-based payments are not exercisable until the servicein the vesting period is completed or specified performance conditions are met, then at eachbalance sheet date within the vesting period, the service obtained in the current period shall beincluded in relevant cost or expenses and in capital reserve at the fair value of the equityinstruments at the grant date based on the best estimates of the quantity of exercisable equityinstruments made by the Group, in accordance with latest changes in the number of exercisableemployees and subsequent information.
(ii) Cash-settled share-based payments
The cash-settled share-based payments where the Group calculates and determines the cash
payments or any other asset obligation on the basis of shares or other equity instruments in returnfor services, is measured at the fair value of the liabilities calculated based on relevant equityinstruments. Where the share-based payments is not exercisable until the service in the vestingperiod is completed or specified performance conditions are met, then at each balance sheet datewithin the vesting period, the service obtained in the current period shall be included in cost orexpenses and in liabilities at the fair value of the Group’s liabilities based on the best estimates ofthe quantity of exercisable equity instruments made by the Group. At each balance sheet date andsettlement date before relevant liabilities are settled, the fair value of the liabilities is remeasuredand the changes are recognised in profit or loss.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(24) Factoring
The factoring business of the Group mainly represents factoring with recourse. Factoring withrecourse is a kind of financing activity where the customer transfers the creditor’s rights of accountsreceivable that meet relevant requirements and are accepted by the Group to the Group accordingto the purchase and sale contract and relevant agreements, so as to obtain short-term tradefinancing, and agrees to repurchase the financing business in full if the creditor’s rights cannot berecovered in full. The Group’s factoring business is accounted for with factoring receivables basedon the amount paid for the creditor’s rights of accounts receivable (Note 2(9)).
(25) Revenue recognition
The Group recognises revenue at the consideration that the Group is entitled to charge as expectedwhen the Group has fulfilled the performance obligations in the contract, that is, the customerobtains control over relevant goods or services.
The Group transfers control of a good or service over time and, therefore, satisfies a performanceobligation and recognises revenue over time, if one of the following criteria is met:
? the customer simultaneously receives and consumes the benefits provided by the Group’s
performance as the Group performs;? the Group’s performance creates or enhances an asset that the customer controls as the
asset is created or enhanced; or? the Group’s performance does not create an asset with an alternative use to the Group and
the Group has an enforceable right to payment for performance completed to date.
Otherwise, revenue is recognised at a point in time when the customer obtains control over relevantgoods or services.
In respect of a contract obligation that is to be fulfilled within a period, the Group should recognisethe revenue based on the progress of the obligation fulfilment within the period, except that theprogress of the obligation fulfilment fails to be reasonably determined; in respect of a contractobligation that is to be fulfilled at a point in time, the Group should recognise the revenue once thecustomer obtains the control over relevant goods.
(a) Rendering of services
Revenue from express delivery and supply chain includes revenue from inbound express deliveryservices including time-define express, economy express, revenue from outbound express deliveryservices, revenue from freight services, revenue from cold-chain transportation services, revenuefrom intra-city instant delivery; revenue from domestic and international transport services ofaviation cargoes; revenue from express delivery agency services, revenue from rendering ofwarehousing service and revenue from providing solutions, etc. The Group’s revenue fromrendering of services also includes revenue from communication service, maintenance service,research and development and technical service.
For the revenue from express delivery and supply chain, the Group recognises revenue based onthe progress of the service performed within period, which is determined based on proportion ofcosts incurred to date to the estimated total costs. As at the balance sheet date, the Groupre-estimates the progress ofthe service performed to reflect the actual status of contractperformance.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(25) Revenue recognition (Cont’d)
(a) Rendering of services (Cont’d)
When the Group recognises revenue based on the progress of the service performed, the amountwith unconditional right to consideration obtained by the Group is recognised as accountsreceivable, and the rest is recognised as contract assets. Meanwhile, provision for accountsreceivable and contract assets is recognised on the basis of expected credit losses (Note 2(9)). Ifthe contract consideration received or receivable exceedsthe progress of the service performed, theexcess portion will be recognised as contract liabilities. Contract assets and contract liabilities underthe same contract are presented on a net basis.
Contract costs include costs to fulfill a contract and costs to obtain a contract. Costs incurred forprovision of the aforesaid services are recognised as costs to fulfill a contract, which is carriedforward to the cost of revenue when revenue recognised based on the progress of the serviceperformed when recognising revenue. Incremental costs incurred by the Group for the acquisition ofthe aforesaid service contract are recognised as the costs to obtain a contract. For the costs toobtain a contract with the amortisation period within one year, the costs are charged to profit or losswhen incurred. For the costs to obtain a contract with the amortisation period beyond one year, thecosts are charged in the current profit or loss on the same basis as aforesaid revenue of renderingof services recognised under the relevant contract. If the carrying amount of the contract costs ishigher than the remaining consideration expected to be obtained by rendering of the service net ofthe estimated cost to be incurred, the Group makes provision for impairment on the excess portionand recognises it as asset impairment losses. As at the balance sheet date, based on whether theamortisation period of the costs to fulfill a contract is more than one year when initially recognised,the amount of the Group's costs to fulfill a contract net of related provision for asset impairment ispresented as inventories or other non-current assets. For costs to obtain a contract withamortisation period beyond one year at the initial recognition, the amount net of related provision forasset impairment is presented as other non-current assets.
With regard to certain research and development services, the Group recognises revenue at a pointin time when the services are delivered to customers.
(b) Sales of goods
Revenue from sales of goods is recognised when the Group has delivered goods to the agreeddelivery location pursuant to the contract and the customer has confirmed the acceptance of thegoods, and the delivery note is signed by both parties.
The credit terms granted to customers by the Group are generally short, in line with industry practice,and do not have a significant financing component.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(26) Government grants
Government grants refer to the monetary or non-monetary assets obtained by the Group from thegovernment, including tax return, financial subsidy, etc.
Government grants are recognised when the grants can be received and the Group can comply withall attached conditions. If a government grant is a monetary asset, it will be measured at the amountreceived or receivable. If a government grant is a non-monetary asset, it will be measured at its fairvalue. If it is unable to obtain its fair value reliably, it will be measured at its nominal amount.
Government grants related to assets refer to the government grants which are obtained by theGroup for the purposes of purchase, construction or acquisition of the long-term assets.Government grants related to income refer to the government grants other than those related toassets.
Government grants related to assets are recorded as deferred income and recognised in profit orloss on a systemic basis over the useful lives of the assets. Government grants related to incomethat compensate the future costs, expenses or losses are recorded as deferred income andrecognised in profit or loss, or deducted against related costs, expenses or losses in reporting therelated expenses; government grants related to income that compensate the incurred costs,expenses or losses are recognised in profit or loss, or deducted against related costs, expenses orlosses directly in current period. The Group applies the presentation method consistently to thesimilar government grants in the financial statements.
Government grants related to daily corporate activities are included in operating profit. Governmentgrants not related to daily corporate activities are included in non-operating income or expenses.
Policy-based loans with prime rate to the Group are recorded at actual amount of borrowingreceived, and related borrowing costs are calculated with borrowing principal and policy-basedprime rate. Financial discounts directly received by the Group are deducted against relatedborrowing costs.
(27) Dividend distribution
Cash dividends are recognised as liabilities in the period in which the dividends are approved by theshareholders’ meeting.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(28) Leases
A finance lease is a lease that transfers substantially all the risks and rewards incidental toownership of an asset. An operating lease is a lease other than a finance lease.
(a) Operating leases
Lease payments under an operating lease are recognised on a straight-line basis over the period ofthe lease, and are either capitalised as part of the cost of related assets, or charged as an expensefor the current period.
Lease income under an operating lease is recognised on a straight-line basis over the period of thelease.
(b) Finance leases (as the leasee)
The leased asset is recognised at the lower of the fair value of the leased asset and the presentvalue of the minimum lease payments. The difference between the recorded amount of the leasedasset and the minimum lease payments is accounted for as unrecognised finance charge and isamortised using the effective interest method over the period of the lease. A long-term payable isrecorded at the amount equal to the minimum lease payments less the unrecognised financecharge.
(c) Finance leases (as the lessor)
At the commencement date of the lease term, lease finance receivables are accounted at the sumof the minimum lease proceeds and the initial direct cost on the lease commencement date;unrealised finance gains are recognised at the difference between the sum of the minimum leaseproceeds and the initial direct cost and its present value. Finance lease income is recognised usingthe effective interest method over the lease term.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(29) Segment information
The Group identifies operating segments based on the internal organisation structure, managementrequirements and internal reporting system, and discloses segment information of reportablesegments which is determined on the basis of operating segments.
An operating segment is a component of the Group that satisfies all of the following conditions: (1)the component is able to earn revenue and incur expenses from its ordinary activities; (2) whoseoperating results are regularly reviewed by the Group’s management to make decisions aboutresources to be allocated to the segment and to assess its performance, and (3) for which theinformation on financial position, operating results and cash flows is available to the Group. If two ormore operating segments have similar economic characteristics and satisfy certain conditions, theyare aggregated into one single operating segment.
(30) Critical accounting estimates and judgements
The Group continually evaluates the critical accounting estimates and key judgements appliedbased on historical experience and other factors, including expectations of future events that arebelieved to be reasonable.
(a) Critical accounting estimates and key assumptions
(i) Measurement of expected credit losses
For financial assets and contract assets at amortised cost, the Group calculates expected creditlosses based on exposure at default and expected credit loss rates. When determining expectedcredit loss rates, the Group refers to internal historical information, such as credit losses, makesadjustment according to current situation and forward-looking information, and the managementtakes the customer’s credit status, credit history, operating status as well as collaterals and theguarantee ability of the guarantor into consideration. The Group monitors and reviews relevantassumptions about expected credit losses regularly. Where there is a difference between the actualbad debts and the original estimate, such difference will affect the Group’s provision for bad debts ofthe above assets in the future period.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(30) Critical accounting estimates and judgements (Cont’d)
(a) Critical accounting estimates and key assumptions (Cont’d)
(ii) Risk of impairment on long-term assets other than goodwill
As described in Note 2(19), fixed assets with impairment indication, construction in progress,intangible assets, investment properties measured using cost model, long-term equity investmentsand other long-term assets are tested for impairment annually at the end of each year.
When assessing whether the above assets are impaired, management mainly evaluates andanalyses: (1) whether events affecting asset impairment occurred; (2) whether the present value ofexpected cash flows arising from the continuing use or disposal of the asset is lower than itscarrying amount; and (3) whether the significant assumptions used in the calculation of the presentvalue of the estimated cash flows are appropriate.
Relevant assumptions adopted by the Group to determine impairment, e.g. changes in assumptionson discount rate and growth rate used to calculate the present value of future cash flows, may havematerial impact on the present value used in the impairment test, and cause impairment in theabove-mentioned long-term assets of the Group.
(iii) Provision for impairment of goodwill
The Group performed impairment assessment of goodwill at each balance sheet date. Therecoverable amounts of asset groups and sets of asset groups that include goodwill have beendetermined by the higher of the fair value less costs of disposal and the present value of the futurecash flows expected to be derived from the assets. These calculations require estimations andjudgements. When the estimated recoverable amount is marginal, goodwill might suffer impairment.The details of the key assumptions applied by the management please refer to Note 4(21).
(iv) Determination of fair value of financial instruments by valuation techniques
The fair value of a financial instrument that is not traded in an active market is determined byvaluation techniques. Valuation techniques primarily refer to direct comparison method and incomemethod, including reference to the prices used in recent orderly transactions between marketparticipants, reference to the current fair value of other financial instruments that are substantiallyidentical, discounted cash flow analysis, option pricing models, etc. Observable market informationis applied in valuation techniques to the extent possible. When observable market information is notavailable, the management will make estimate of significant unobservable information included inthe valuation method. Different valuation techniques or inputs may lead to significant differencesbetween fair value estimates.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(30) Critical accounting estimates and judgements (Cont’d)
(a) Critical accounting estimates and key assumptions (Cont’d)
(v) Recognition of deferred tax assets
Deferred tax assets are recognised for the deductible tax losses and deductible temporarydifferences that can be carried forward to subsequent years to the extent that it is probable thattaxable profit in the future will be available against which the deductible tax losses and deductibletemporary differences can be utilised. Whether to recognise the deferred tax assets arising fromdeductible tax losses and deductible temporary differences largely depends on the judgement ofmanagement on: (i) whether the accumulated deductible tax losses and deductible temporarydifferences in prior years are still effective, and (ii) whether sufficient taxable income that can beused to deduct deductible tax losses and deductible temporary differences can be obtained in thefuture period. Where there is a difference between the situation and the original estimate, suchdifference will affect the Group’s deferred tax assets and income tax expenses in the future period.
(b) Critical judgements in applying the accounting policies
(i) Judgement on significant influence of the Group over investees
The investees over which the Group has significant influence are accounted for under the equitymethod. In judging the significant influence over an investee, management considers based on oneor more of the following circumstances and all facts and circumstances: (1) the shareholding in theinvestee; (2) whether it appoints representative in the Board of Directors or a similar authority of theinvestee; (3) whether it participates in making decisions on financial and operating policies of theinvestee; (4) whether it has significant transaction with the investee; (5) whether it assignsmanagement personnel to the investee; (6) whether it provides key technical materials to theinvestee, and all facts and circumstances are considered.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(30) Critical accounting estimates and judgements (Cont’d)
(b) Critical judgements in applying the accounting policies (Cont’d)
(ii) Determination of the scope of consolidation
As stated in Note 2(6), the Group use consolidates a subsidiary from the date of obtaining actualcontrol, and excludes it out of the scope of consolidation from the date of losing the actual control.Control existed when the Group has all three of the following elements: (1) the investor possessespower over the investee; (2) has exposure to variable returns from its involvement with theinvestee's related activities; and (3) the ability to use the power over the investee to affect thereturns.
When assessing whether it has powers over the asset-backed special scheme (“Special Scheme”)entity, the Group mainly considers the following aspects: (1) related activities of the Special Schemeand ways to make decisions on such activities; (2) the scope of decision-making authority of theGroup, including the proportion of the equity-grade securities it held, the right to carry out dailyoperation management of the logistics industrial parks under entrustment and certain other rightsentitled to and other obligations undertaken by the Group to the Special Scheme; and (3) otherparties’ substantive rights.
When assessing the entitlements to variable returns in virtue of participation in related activities ofthe Special Scheme, the Group mainly considers the return level for the Group and the risks borneby the Group, including return on its investment in equity-grade securities and compensation andcommitment for property operation management service provided.
Where variations in relevant facts and circumstances cause a change of these factors, areassessment will be made.
(31) Changes in significant accounting policies
In 2017, the Ministry of Finance released the revised CAS 14 - Revenue (“new revenue standard”).The Group first applied the new revenue standard on 1 January 2020, and the financial statementsfor the period ended 30 June 2020 are prepared in accordance with the new revenue standard.Impacts of implementation of new revenue standard on the Group and the Company’s financialstatements are as follows:
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Summary of significant accounting policies and accounting estimates (Cont’d)
(31) Changes in significant accounting policies (Cont’d)
| In accordance with relevant provisions of the new revenue standard, the Group and the Company recognised the cumulative effect of initially applying the standard as an adjustment to the opening balance of retained earnings and other relevant line items in the financial statements at the beginning of 2020. The comparatives for the year ended 31 December 2019 were not restated. | ||||
| The contents and reasons of the changes in accounting policies | The line items affected | The amounts affected | ||
| 1 January 2020 | ||||
| Consolidated | Company | |||
| Due to the implementation of the new revenue standard, the Group changed the revenue recognition of rendering of services from at a point in time to over time based on the progress of the service performed, and recognised contract assets and accounts payable, with an adjustment to the opening balance of retained earnings accordingly. | Contract assets | 281,523,856.59 | - | |
| Accounts payable | 238,563,316.07 | - | ||
| Taxes payable | 10,740,135.13 | - | ||
| Retained earnings | 32,220,405.39 | - | ||
| Due to the implementation of the new revenue standard, the Group reclassified the advances from customers relevant to service provision to contract liabilities. | Contract liabilities | 647,619,339.93 | - | |
| Advances from customers | (647,619,339.93) | - | ||
| Compared with the original revenue standard, the impact of the implementation of the new revenue standard on related items of the financial statement for the six months ended 30 June 2020 is as follows: | ||||
| Balance sheet items affected | The amounts affected | |||
| 30 June 2020 | ||||
| Consolidated | Company | |||
| Contract assets | 359,294,568.02 | - | ||
| Accounts payable | 301,052,082.71 | - | ||
| Contract liabilities | 1,117,387,097.90 | - | ||
| Advances from customers | (1,117,387,097.90) | - | ||
| Taxes payable | 14,560,621.33 | - | ||
| Retained earnings | 43,681,863.98 | - | ||
| Income statement items affected | ||||
| The amounts affected | ||||
| For the six months ended 30 June 2020 | ||||
| Consolidated | Company | |||
| Revenue | 77,770,711.43 | - | ||
| Cost of revenue | (62,488,766.64) | - | ||
| Income tax expenses | (3,820,486.20) | - | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
3 Taxation
The main categories and rates of taxes applicable to the Group are set out below:
| Category | Tax rate | Tax base |
| Enterprise income tax | Note (1) | Taxable income |
| Value-added tax (“VAT”) | Note (2) | Taxable value-added amount (Tax payable is calculated using the taxable sales amount/taxable service income multiplied by the applicable tax rate less deductible VAT input of the current period or taxable turnover amount multiplied by the VAT rate) |
| City maintenance and construction tax | 7%, 5%, 1% | Amount of VAT paid |
| Educational surcharge | 3% | Amount of VAT paid |
| Local educational surcharge | 2% | Amount of VAT paid |
| Customs duty | At applicable tax rate | Customs dutiable value through examination and approval of the Customs |
In addition, pursuant to the Interim Measures for the Collection, Use and Management of the CivilAviation Development Fund (Cai Zong [2012] No. 17) issued by the Ministry of Finance, SF AirlinesCompany Limited (“SF Airlines”) pays the civil aviation development fund based on classification offlight routes, maximum take-off weight, flight mileage and applicable collection standards, andincludes such payment in cost.
Pursuant to the Announcement on the Exemption of Certain Administrative Fees andGovernment-managed Funds During the Prevention and Control of the Outbreak of NovelCoronavirus Pneumonia (COVID-19) (Announcement [2020] No. 11) jointly issued by the Ministry ofFinance and the National Development and Reform Commission on 6 February 2020, and theAnnouncement on the Implementation Period of the Tax and Fee Polices Supporting the Preventionand Control of the COVID-19 Outbreak, the Guarantee of Supply during the COVID-19 Outbreakand Other Matters (Announcement [2020] No. 28) jointly issued by the Ministry of Finance and theState Administration of Taxation on 15 May 2020, the Group shall be exempted from the above civilaviation development funds from 1 January 2020 to 31 December 2020.
(1) Enterprise income tax
Pursuant to the Notice on the Deduction of Enterprise Income Tax Policies for Equipment andApparatus (Cai Shui [2018] No. 54) and related regulations issued by the State Administration ofTaxation, the cost of equipment purchased less than RMB 5,000,000 from 1 January 2018 to 31December 2020 can be deducted against taxable on a straight-line basis over income in thefollowing month after the assets are put into use, instead of being deducted annually in its useful life.
Besides, the preferential enterprise income tax policies to which the Group is entitled mainly include:
(a) Pursuant to the Notice on the Policies and Catalogue of Income Tax Preferences for Enterprises in
Guangdong Hengqin New Area, Fujian Pingtan Comprehensive Experimental Zone, and ShenzhenQianhai Shenzhen-Hong Kong Modern Service Industry Cooperative Zone (Cai Shui [2014] No. 26)jointly issued by the Ministry of Finance and the State Administration of Taxation, the Group’ssubsidiaries as below are subject to enterprise income tax at the preferential rate of 15% from 2014to 2020.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
3 Taxation (Cont'd)
(1) Enterprise income tax (Cont'd)
(a) (Cont’d)
| Name of subsidiary | Local statutory tax rate | Preferential tax rate |
| Guangdong S.F. E-commerce Co., Ltd. | 25% | 15% |
| Shenzhen S.F. Supply Chain Co., Ltd. | 25% | 15% |
| Shenzhen S.F. International Logistics Co., Ltd. | 25% | 15% |
| Shenzhen S.F Information Service Technology Co., Ltd. | 25% | 15% |
(b) Pursuant to the Notice on Tax Policy Issues Concerning Further Implementing the Western China
Development Strategy (Cai Shui [2011] No. 58) and the Notice on Issues Concerning theImplementation of the Tax Policies for the Development of Western China by Ganzhou City (CaiShui [2013] No. 4) jointly issued by the Ministry of Finance, the General Administration of Customsand the State Administration of Taxation, and the Announcement on Continuing the EnterpriseIncome Tax Policies for the Development of Western China (Announcement [2020] No. 23) jointlyissued by the Ministry of Finance, the State Administration of Taxation and the NationalDevelopment and Reform Commission on 23 April 2020, the Group’s subsidiaries as below aresubject to enterprise income tax at the preferential rate of 15% until the end of 2030:
| Name of subsidiary | Local statutory tax rate | Preferential tax rate |
| Xi'an Shunlu Logistics Co., Ltd. | 25% | 15% |
| Chengdu Taishun Logistics Co., Ltd. | 25% | 15% |
| Chongqing Huiyifeng Logistics Co., Ltd. | 25% | 15% |
| S.F. Express (Chongqing) Co., Ltd. | 25% | 15% |
| Guizhou S.F. Express Co., Ltd. | 25% | 15% |
| Yunnan S.F. Express Co., Ltd. | 25% | 15% |
| Sichuan S.F. Express Co., Ltd. | 25% | 15% |
| Ganzhou S.F. Express Co., Ltd. | 25% | 15% |
| Xi'an S.F. Express Co., Ltd. | 25% | 15% |
| Guangxi S.F. Express Co., Ltd. | 25% | 15% |
| S.F. Express (Ningxia) Co., Ltd. | 25% | 15% |
| Inner Mongolia S.F. Express Co., Ltd. | 25% | 15% |
| Xinjiang S.F. Express Co., Ltd. | 25% | 15% |
| Qinghai S.F. Express Co., Ltd. | 25% | 15% |
| Lanzhou S.F. Express Co., Ltd. | 25% | 15% |
| Yunnan Shunhe Freight Co., Ltd. | 25% | 15% |
| Qinghai S.F. Juyi Supply Chain Management Co., Ltd. | 25% | 15% |
| Gansu Shunhefeng Freight Co., Ltd. | 25% | 15% |
| Sichuan Wu Lian Yi Da Technology Co., Ltd. | 25% | 15% |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
3 Taxation (Cont'd)
(1) Enterprise income tax (Cont'd)
(c) Pursuant to the Notice on Tax Policy Issues Concerning Further Implementing the Western China
Development Strategy (Cai Shui [2011] No. 58) jointly issued by the Ministry of Finance, the GeneralAdministration of Customs and the State Administration of Taxation, and the Announcement onContinuing the Enterprise Income Tax Policies for the Development of Western China(Announcement [2020] No. 23) jointly issued by the Ministry of Finance, the State Administration ofTaxation and the National Development and Reform Commission on 23 April 2020, the Group’ssubsidiaries, which are registered in Tibet Autonomous Region, are subject to enterprise income taxat the preferential rate of 15% as stipulated in the Western China Development Strategy from 1January 2011 to 31 December 2030. Pursuant to the Notice of the People’s Government of the TibetAutonomous Region on Issuing the Regulations on Preferential Policies for Investment Promotion ofthe Tibet Autonomous Region (Provisional) (Zang Zheng Fa [2018] No. 25), the Group’ssubsidiaries, which are registered in Tibet Autonomous Region are temporarily exempt from theregion’s share of entitlement to enterprise income tax payable from 1 January 2018 to 31 December2021. In other words, the region’s share of entitlement to 40% in the enterprise income tax payableat the rate of 15% is exempted during the above period.
| Name of subsidiary | Local statutory tax rate | Preferential tax rate |
| Tibet S.F. Express Co., Ltd. | 25% | 9% |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
3 Taxation (Cont'd)
(1) Enterprise income tax (Cont'd)
(d) In accordance with Article 2 of the Notice on Implementing the Inclusive Tax Deduction and
Exemption Policies for Micro and Small Enterprises (Cai Shui [2019] No. 13) jointly issued by theMinistry of Finance and the State Administration of Taxation, the portion of annual taxable income ofthe Company’s subsidiaries not exceeding RMB 1 million is recognised at 25%; the portion ofannual taxable income of the Group’s subsidiaries exceeding RMB 1 million but not exceeding RMB3 million is recognised at 50%, and they are subject to enterprise income tax at the rate of 20%:
| Name of subsidiary | Local statutory tax rate | Preferential tax rate |
| Ningbo Shuncheng Logistics Co., Ltd. | 25% | 20% |
| Guizhou Shunlu Logistics Co., Ltd. | 25% | 20% |
| Ezhou Shunlu Logistics Co., Ltd. | 25% | 20% |
| Zhengzhou Shuncheng Logistics Co., Ltd. | 25% | 20% |
| Hangzhou S.F. E-commerce Co., Ltd. | 25% | 20% |
| Hangzhou Shunyifeng Import & Export Trading Co., Ltd. | 25% | 20% |
| Shenzhen S.F. Research Institution Co., Ltd. | 25% | 20% |
| Shanghai Chengbai Technology Co., Ltd. | 25% | 20% |
| Shenyang Fengtai E-Commerce Industrial Park Management Co., Ltd. | 25% | 20% |
| Xuzhou Fengtai Industrial Park Management Co., Ltd. | 25% | 20% |
| Ezhou Fengtai Qisheng Logistics Development Co., Ltd. | 25% | 20% |
| Ezhou Fengyutai Helin Logistics Development Co., Ltd. | 25% | 20% |
| Ganzhou Fengtai Industrial Park Management Co., Ltd. | 25% | 20% |
| Yangzhou Fengyutai Enterprise Management Co., Ltd. | 25% | 20% |
| Shanghai Fengtai Yuanxing Property Management Service Co., Ltd. | 25% | 20% |
| Shenzhen Fengtai E-Commerce Industrial Park Property Service Co., Ltd. | 25% | 20% |
| Taizhou Fengtai E-Commerce Industrial Park Operation and Management Co., Ltd. | 25% | 20% |
| Taixing Fengtai Industrial Park Operation and Management Co., Ltd. | 25% | 20% |
| Wuxi Jietai Enterprise Management Co., Ltd. | 25% | 20% |
| Huai'an Fengtai Enterprise Management Co., Ltd. | 25% | 20% |
| Quanzhou Fengyutai Enterprise Management Co., Ltd. | 25% | 20% |
| Hefei Jietai Enterprise Management Co., Ltd. | 25% | 20% |
| Beijing Fengyutai Operations and Management Co., Ltd. | 25% | 20% |
| Shenzhen Shunfeng Runtai Management Consulting Co., Ltd. | 25% | 20% |
| Guangxi Shunnongfengwei Technology Co., Ltd. | 25% | 20% |
| Rongyilian Technology (Shenzhen) Co., Ltd. | 25% | 20% |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
3 Taxation (Cont'd)
(1) Enterprise income tax (Cont'd)
(e) Pursuant to the Notice on Enterprise Income Tax Policies for Further Encouraging the Development
of Software and Integrated Circuit Industries (Cai Shui [2012] No. 27) jointly issued by the Ministry ofFinance and the State Administration of Taxation, the Notice on the Issues of the Policies ofEnterprise Income Tax Preferences for Software and Integrated Circuit Industries (Cai Shui [2016]No. 49) jointly issued by the Ministry of Finance, the State Administration of Taxation, NationalDevelopment and Reform Commission and the Ministry of Industry and Information Technology, andthe Announcement on Issuing the Revised Measures for the Matters concerning PreferentialEnterprise Income Tax Policies (Announcement [2018]) No. 23) issued by the State Administrationof Taxation, and through filing with Shenzhen Nanshan District Taxation Bureau, the Group’ssubsidiary below is subject to enterprise income tax at the preferential rate of 10% from 1 January2017 as a key software enterprise under the national planning and layout:
| Name of subsidiary | Local statutory tax rate | Preferential tax rate |
| SF Technology Co., Ltd. (“SF Technology”) | 25% | 10% |
(f) As per Article 28 of the Enterprise Income Tax Law of the People’s Republic of China, the high and
new technology enterprises eligible for key support from the State are entitled to a reduced tax rateof 15%. Through filing with local taxation bureaus, the Group’s subsidiaries as below are qualified ashigh and new technology enterprises, and entitled to the preferential tax rates for high and newtechnology enterprises eligible for key support from the State. The subsidiaries as below are subjectto a tax rate of 15% in the reporting period.
| Name of subsidiary | Local statutory tax rate | Preferential tax rate |
| S.F. Hengtong Pay Co., Ltd. | 25% | 15% |
| Beijing S.F. Intra-city Technology Co., Ltd. | 25% | 15% |
(g) Pursuant to the Notice on the Policies of Income Tax Preferences for Enterprises in Hainan Free
Trade Port (Cai Shui [2020] No. 31) jointly issued by the Ministry of Finance and the StateAdministration of Taxation, the Group’s subsidiaries, which are registered in Hainan Free Trade Port,are subject to enterprise income tax at the preferential rate of 15% from 1 January 2020 to 31December 2024.
| Name of subsidiary | Local statutory tax rate | Preferential tax rate |
| Hainan SF. Express Co., Ltd. | 25% | 15% |
| Hainan SF Freight Co., Ltd. | 25% | 15% |
In addition, the Group’s subsidiaries located in Hong Kong, Singapore, Japan, Korea and USA aresubject to enterprise income tax at the rates of 16.5%, 17%, 23.2%, 22% and 21% respectively inthe reporting period.
In addition to the above subsidiaries, the Company and the Group’s other major subsidiaries aresubject to enterprise income tax at the rate of 25%.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
3 Taxation (Cont'd)
(2) VAT
According to different businesses, VAT rates applicable to the Group include:
| Business type | Applicable VAT rates |
| Sales of goods and leasing (i) | 16% (before 1 April 2019), 13% (since 1 April 2019) |
| Transportation service (i) (ii) (iii) | 10% (before 1 April 2019), 9% (since 1 April 2019) |
| Logistics supporting service (ii) (iii) (iv) | 6% |
| 3% (applicable to small-scale taxpayers before 1 March 2020) | |
| 1% (applicable to small-scale taxpayers excluding those of Hubei Province from 1 March to 31 December 2020), 0% (applicable to small-scale taxpayers of Hubei Province from 1 March to 31 December 2020) | |
| Research and development and technical service | 6% |
| Information technology service | 6% |
| Property leases (i) | 10% (before 1 April 2019), 9% (since 1 April 2019) |
(i) Pursuant to the Announcement on Policies for Deepening the Value-Added Tax Reform (Cai Shui
[2019] No. 39), the VAT taxable sales or goods import, which were subject to the tax rates of 16%and 10%, are subject to 13% and 9% respectively upon adjustment. The aforesaid circular has beeneffective since 1 April 2019.
(ii) Pursuant to the Announcement on Policies for Deepening the Value-Added Tax Reform (Cai Shui
[2019] No. 39) and the Announcement on Clarifying the Additional Value-Added Tax Credit Policyfor the Life Service Industry (Cai Shui [2019] No. 87), from 1 April 2019 to 31 December 2021,taxpayers whose sales amount from providing postal service, telecommunication service, modernservice and life services accounts for more than 50% of the total sales amount are allowed to creditthe amount of input tax deductible in the current period plus 10% thereof against the amount oftaxes payable; from 1 October 2019 to 31 December 2021, taxpayers whose sales amount fromproviding life services accounts for more than 50% of the total sales amount are allowed to credit theamount of input tax deductible in the current period plus 15% thereof against the amount of taxespayable.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
3 Taxation (Cont'd)
(2) VAT (Cont'd)
(iii) In accordance with the Announcement on Relevant Tax Policies Supporting the Prevention and
Control of the Outbreak of Novel Coronavirus Pneumonia (COVID-19) (Announcement [2020] No. 8)and the Announcement on the Implementation Period of the Tax and Fee Polices Supporting thePrevention and Control of the COVID-19 Outbreak, the Guarantee of Supply during the COVID-19Outbreak and Other Matters (Announcement [2020] No. 28) jointly issued by the Ministry of Financeand the State Administration of Taxation on 6 February 2020 and 15 May 2020 respectively, from 1January 2020 to 31 December 2020, taxpayers’ revenue from transportation of key supportingmaterials for epidemic prevention and control, provision of public transportation services, livingservices as well as the express delivery service of essential living materials for residents will beexempted from VAT, city maintenance and construction tax, educational surcharge and localeducational surcharge.
(iv) Pursuant to the Announcement on the Value-Added Tax Policies on Supporting the Resumption of
Work and Business of Individual Industrial and Commercial Households (Announcement [2020] No.
13) and the Announcement on Extending the Applicable Period of the Policies for Reduction andExemption of Value-added Tax on Small-scale Taxpayers (Announcement [2020] No. 24) jointlyissued by the Ministry of Finance and the State Administration of Taxation on 28 February 2020 and30 April 2020 respectively, from 1 March to 31 December 2020, taxable sales revenue ofsmall-scale taxpayers of Hubei Province subject to VAT at the rate of 3% before shall be exemptedfrom VAT; while the prepaid VAT items subject to the prepaid collection rate of 3% before shall besuspended for the prepayment of VAT. Taxable sales revenue of small-scale taxpayers in otherprovinces, autonomous regions and municipalities directly under the central government excludingHubei Province subject to VAT at the rate of 3% before shall be subject to VAT at the preferentialrate of 1%; while the prepaid VAT items in such regions subject to the prepaid collection rate of 3%before shall be subject to prepaid VAT at the preferential rate of 1%.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements
(1) Cash at bank and on hand
| 30 June 2020 | 31 December 2019 | ||
| Cash on hand | 195,351.88 | 188,281.28 | |
| Cash at bank | 9,278,930,595.74 | 17,654,474,529.50 | |
| Balances with central bank from Group Finance Company | 800,916,995.28 | 792,594,922.81 | |
| Including: Balances with central bank | |||
| - statutory reserve (a) | 794,717,467.25 | 785,012,298.46 | |
| Balances with central bank | |||
| - excess reserve (b) | 6,199,528.03 | 7,582,624.35 | |
| Other cash balances (c) | 29,886,738.69 | 51,599,389.56 | |
| Accrued interest | 2,661,831.91 | 22,134,613.95 | |
| 10,112,591,513.50 | 18,520,991,737.10 | ||
| Including: Total overseas deposits | 1,011,560,856.66 | 967,339,663.84 |
(a) On 18 September 2016, the Group incorporated S.F. Holding Group Finance Co., Ltd. (“Group
Finance Company”). Statutory reserve of Group Finance Company deposited with the central bankrepresents required statutory reserve paid by financial enterprises in the People’s Bank of China(“PBOC”) at 6% of deposits from customers denominated in RMB. Statutory reserve deposits arenot available for use by the Group in its day to day operations, which are restricted cash.
(b) Surplus reserve of Group Finance Company deposited with the central bank represents the excess
over the required statutory reserve paid by financial institutions in the central bank, and it is bankdeposit that can be readily drawn on demand.
(c) As at 31 December 2019, RMB 30,000,000.00 of the other cash balances represented guarantees
for bank acceptance notes and was restricted. As at 30 June 2020, such guarantees were overdue.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(2) Placements with and loans to banks and other financial institutions
As at 31 December 2019, placements with and loans to banks and other financial institutions camefrom the Group Finance Company, a subsidiary of the Group.
| 30 June 2020 | 31 December 2019 | ||
| Placements with domestic banks | - | 200,000,000.00 | |
| Accrued interest | - | 728,611.11 | |
| Less: Provision for impairment loss | - | - | |
| - | 200,728,611.11 |
(3) Financial assets held for trading
| 30 June 2020 | 31 December 2019 | ||
| Structural deposits | 13,471,241,285.61 | 2,909,852,581.06 | |
| Others | 174,323.32 | 320,347.14 | |
| 13,471,415,608.93 | 2,910,172,928.20 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(4) Accounts receivable
| 30 June 2020 | 31 December 2019 | ||
| Accounts receivable | 13,485,447,903.35 | 12,170,272,296.49 | |
| Less: Provision for bad debts | (284,910,733.79) | (125,729,570.66) | |
| 13,200,537,169.56 | 12,044,542,725.83 |
The Group adopts regular settlement method for express & logistics comprehensive servicesprovided to some customers. At each month-end, the outstanding part becomes accountsreceivable.
(a) The ageing of accounts receivable was analysed as follows:
| 30 June 2020 | 31 December 2019 | ||
| Within 1 year (inclusive) | 13,268,467,538.86 | 12,064,412,162.95 | |
| 1 to 2 years (inclusive) | 177,245,253.44 | 82,722,342.92 | |
| Over 2 years | 39,735,111.05 | 23,137,790.62 | |
| 13,485,447,903.35 | 12,170,272,296.49 |
(b) As at 30 June 2020, the five largest accounts receivable aggregated by debtor were summarised
and analysed as follows:
| 30 June 2020 | |||||
| Amount | Amount of provision for bad debts | % of total balance | |||
| Sum of the five largest accounts receivable | 1,840,215,354.31 | (9,201,076.77) | 13.65% | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(4) Accounts receivable (Cont’d)
(c) Provision for bad debts
For accounts receivable, the Group recognises the lifetime expected credit loss provision regardlessof whether there exists a significant financing component.
As at 30 June 2020, accounts receivable for which the related provision for bad debts was providedon the individual basis were analysed as follows:
| Ending balance | Lifetime expected credit loss rate | Provision for bad debts | Reason | |||
| Receivables from related parties | - | - | - | |||
| Receivables from non-related parties | 210,610,017.79 | 100.00% | (210,610,017.79) | The debtor encountered financial difficulties, etc. | ||
| 210,610,017.79 | (210,610,017.79) |
As at 31 December 2019, accounts receivable for which the related provision for bad debts wasprovided on the individual basis were analysed as follows:
| Ending balance | Lifetime expected credit loss rate | Provision for bad debts | Reason | |||
| Receivables from related parties | - | - | - | |||
| Receivables from non-related parties | 56,740,345.11 | 100.00% | (56,740,345.11) | The debtor encountered financial difficulties, etc. | ||
| 56,740,345.11 | (56,740,345.11) |
As at 30 June 2020, accounts receivable for which the related provision for bad debts was providedon the grouping basis were analysed as follows:
| 30 June 2020 | ||||||
| Ending balance | Provision for bad debts | |||||
| Amount | Lifetime expected credit loss rate | Amount | ||||
| Related party grouping | 228,431,192.41 | - | - | |||
| Non-related party grouping | 13,046,406,693.15 | 0.57% | (74,300,716.00) | |||
| 13,274,837,885.56 | (74,300,716.00) | |||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(4) Accounts receivable (Cont’d)
(c) Provision for bad debts (Cont’d)
As at 31 December 2019, accounts receivable for which the related provision for bad debts wasprovided on the grouping basis were analysed as follows:
| 31 December 2019 | ||||||
| Ending balance | Provision for bad debts | |||||
| Amount | Lifetime expected credit loss rate | Amount | ||||
| Related party grouping | 231,430,940.86 | - | - | |||
| Non-related party grouping | 11,882,101,010.52 | 0.58% | (68,989,225.55) | |||
| 12,113,531,951.38 | (68,989,225.55) | |||||
(d) For the six months ended 30 June 2020, the Group’s provision for bad debts amounted to RMB
205,151,831.67, and there was no provision for bad debts reversed (Note 4(24)).
(e) For the six months ended 30 June 2020, the provision for bad debts of accounts receivable that was
written off amounted to RMB 45,941,387.72 (Note 4(24)) and no accounts receivable with amountsthat were individually significant were written off.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(5) Advances to suppliers
(a) The ageing of advances to suppliers was analysed below:
| 30 June 2020 | 31 December 2019 | ||||||
| Ageing | Amount | % of total balance | Amount | % of total balance | |||
| Within 1 year (inclusive) | 2,592,682,123.65 | 97.33% | 2,595,294,276.41 | 97.78% | |||
| 1 to 2 years (inclusive) | 48,080,493.55 | 1.80% | 31,784,063.41 | 1.20% | |||
| Over 2 years | 23,182,628.04 | 0.87% | 27,166,624.43 | 1.02% | |||
| 2,663,945,245.24 | 100.00% | 2,654,244,964.25 | 100.00% | ||||
As at 30 June 2020, advances to suppliers with ageing over one year were mainly prepaid property rents, materials, transportation expenses, etc. That isbecause relevant business transactions were still being performed.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(5) Advances to suppliers (Cont’d)
(b) As at 30 June 2020, the amount of the top five advances to suppliers was analysed as follows:
| 30 June 2020 | |||
| Amount | % of total balance | ||
| Sum of the five largest advances to suppliers | 379,396,848.99 | 14.24% | |
(6) Factoring receivables
As at 30 June 2020 and 31 December 2019, factoring receivables were from Shenzhen ShunchengLefeng Factoring Co., Ltd. (“Lefeng Factoring”), a subsidiary of the Group, for provision of factoringbusiness to external parties.
| 30 June 2020 | 31 December 2019 | ||
| Factoring receivables | 126,631,796.99 | 127,216,839.72 | |
| Less: Provision for bad debts | (124,121,065.12) | (74,519,671.86) | |
| 2,510,731.87 | 52,697,167.86 |
(a) Factoring receivables are disclosed by category as follows:
| 30 June 2020 | |||||||
| Amount | Proportion | Provision for bad debts | Net amount | ||||
| Factoring with recourse | 126,631,796.99 | 100.00% | (124,121,065.12) | 2,510,731.87 | |||
| 31 December 2019 | |||||||
| Amount | Proportion | Provision for bad debts | Net amount | ||||
| Factoring with recourse | 127,216,839.72 | 100.00% | (74,519,671.86) | 52,697,167.86 | |||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(6) Factoring receivables (Cont’d)
(b) Overdue factoring receivables are presented by past-due ageing as follows:
| 30 June 2020 | |||||||||
| Within 1 month | 1 to 6 months | 6 months to 1 year | Over 1 year (inclusive) | Total | |||||
| Factoring receivables | - | 2,276,489.89 | 19,221.36 | 123,900,619.54 | 126,196,330.79 | ||||
| Less: Provision for bad debts | - | (207,228.97) | (13,216.61) | (123,900,619.54) | (124,121,065.12) | ||||
| - | 2,069,260.92 | 6,004.75 | - | 2,075,265.67 | |||||
| 31 December 2019 | |||||||||
| Within 1 month | 1 to 6 months | 6 months to 1 year | Over 1 year (inclusive) | Total | |||||
| Factoring receivables | - | 19,221.36 | 1,190,999.41 | 122,709,620.13 | 123,919,840.90 | ||||
| Less: Provision for bad debts | - | (6,608.30) | (895,670.51) | (73,617,393.05) | (74,519,671.86) | ||||
| - | 12,613.06 | 295,328.90 | 49,092,227.08 | 49,400,169.04 | |||||
(c) For the six months ended 30 June 2020, the Group’s provision for bad debts amounted to RMB
49,601,393.26, and there was no provision for bad debts reversed or written-off (Note 4(24)).
(d) As at 30 June 2020, the Group’s factoring receivables for which related provision for bad debts was
provided on individual basis amounted to RMB 123,959,055.94, including provision for bad debtsamounting to RMB 123,950,244.87.
(7) Loans and advances
As at 30 June 2020, the balance of loans and advances was formed by the external loans issued byS.F. Finance (Hong Kong) Limited (“S.F. Finance”), which is a subsidiary of the Group in Hong Kong,and Group Finance Company (as at 31 December 2019: the balance of loans and advances wasformed by the external loans issued by S.F. Finance).
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(7) Loans and advances (Cont’d)
(a) Loans and advances by individual and enterprise
| 30 June 2020 | 31 December 2019 | ||
| Personal loans | 93,896.49 | 111,590.41 | |
| Enterprise loans | |||
| Non-related party loans | 97,499,503.72 | 96,849,628.97 | |
| Related party loans (Note 8(4)(c)) | 53,853,022.56 | - | |
| Loans and advances - total | 151,446,422.77 | 96,961,219.38 | |
| Less: Provision for loan losses | (104,405,744.13) | (15,219,113.18) | |
| Loans and advances - net | 47,040,678.64 | 81,742,106.20 |
(b) Loans and advances analysed by type of collateral
| 30 June 2020 | 31 December 2019 | ||
| Credit loans | 143,859,942.58 | 89,672,228.97 | |
| Guaranteed loans | 7,586,480.19 | 7,288,990.41 | |
| Loans and advances - total | 151,446,422.77 | 96,961,219.38 |
(c) Overdue loans are presented by pass-due ageing as follows:
| 30 June 2020 | |||||||||
| Within 3 months | 3 months to 1 year | 1 to 3 years | Over 3 years | Total | |||||
| Credit loans | 2,191,090.31 | 4,803,479.16 | 2,626,346.38 | - | 9,620,915.85 | ||||
| 31 December 2019 | |||||||||
| Within 3 months | 3 months to 1 year | 1 to 3 years | Over 3 years | Total | |||||
| Credit loans | 1,680,290.35 | 3,264,446.60 | 591,181.80 | - | 5,535,918.75 | ||||
(d) For the six months ended 30 June 2020, the Group’s provision for bad debts amounted to RMB
89,186,630.95, and there was no provision for bad debts reversed (Note 4(24)).
(e) As at 30 June 2020, the Group’s loans and advances for which the provision for bad debts was
provided on the individual basis amounted to RMB 103,201,535.23, of which the provision for baddebts amounted to RMB 103,201,535.23.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(8) Other receivables
| 30 June 2020 | 31 December 2019 | ||
| Current accounts receivable from related parties (Note 8(4)(d)) | 296,089,810.24 | 294,204,283.58 | |
| Guarantees and deposits | 763,285,379.73 | 680,953,317.24 | |
| Cash on delivery service | 335,713,617.43 | 284,688,435.91 | |
| Receivables from equity transfer and capital reductions | 130,992,500.00 | 156,997,540.37 | |
| Airlines subsidy | 142,995,899.34 | 124,175,967.85 | |
| Financial rebate | 27,663,700.00 | 24,691,800.00 | |
| Employee borrowings and advances | 93,883,795.65 | 145,969,805.47 | |
| Tax collected by others | 138,656,789.66 | 143,431,840.62 | |
| Entrusted loans receivable | 27,000,000.00 | 27,000,000.00 | |
| Others | 196,034,272.56 | 247,299,964.50 | |
| 2,152,315,764.61 | 2,129,412,955.54 | ||
| Less: Provision for bad debts | (133,126,263.24) | (27,205,716.14) | |
| 2,019,189,501.37 | 2,102,207,239.40 |
(a) The ageing of other receivables is analysed as follows:
| 30 June 2020 | 31 December 2019 | ||
| Within 1 year (inclusive) | 1,616,540,768.44 | 1,709,844,656.77 | |
| 1 to 2 years (inclusive) | 312,387,918.70 | 187,996,839.38 | |
| Over 2 years | 223,387,077.47 | 231,571,459.39 | |
| 2,152,315,764.61 | 2,129,412,955.54 |
As at 30 June 2020, other receivables with ageing over 1 year mainly represented guarantees,deposits and receivables from equity transfer.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(8) Other receivables (Cont’d)
(b) Provision for losses and changes in book balance statements
(i) The Group measures the loss provision for other receivables based on the expected credit losses for the next twelve months or the entire duration.
| Stage 1 | Stage 3 | |||||||||
| Expected credit losses in the following 12 months (Portfolio) | Lifetime expected credit losses (credit impaired) | Total | ||||||||
| Ending balance | Provision for bad debts | Ending balance | Provision for bad debts | Provision for bad debts | ||||||
| 31 December 2019 | 2,102,161,329.94 | (10,754,090.54) | 27,251,625.60 | (16,451,625.60) | (27,205,716.14) | |||||
| Net increase/provision in the current period | 31,654,437.82 | (6,811,598.70) | - | (107,860,577.15) | (114,672,175.85) | |||||
| Write-off/Disposal in the current period | (8,751,628.75) | 8,751,628.75 | - | - | 8,751,628.75 | |||||
| Transfer to Stage 3 | (108,368,077.15) | 507,500.00 | 108,368,077.15 | (507,500.00) | - | |||||
| 30 June 2020 | 2,016,696,061.86 | (8,306,560.49) | 135,619,702.75 | (124,819,702.75) | (133,126,263.24) | |||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(8) Other receivables (Cont’d)
(b) Provision for losses and changes in book balance statements (Cont’d)
As at 30 June 2020 and 31 December 2019, the Group did not have any other receivables at Stage1 for which the related provision for bad debts was provided on the individual basis.
As at 30 June 2020, other receivables at Stage 1 for which the related provision for bad debts wasprovided on the grouping basis were analysed as follows:
| Ending balance | Expected credit loss rate in the following 12 months | Provision for bad debts | Reason | |||
| Provided on the grouping basis: | ||||||
| Related party grouping | 296,089,810.24 | - | - | |||
| Non-related party grouping | 1,720,606,251.62 | 0.48% | (8,306,560.49) | Expected credit loss method | ||
| 2,016,696,061.86 | (8,306,560.49) |
As at 31 December 2019, other receivables at Stage 1 for which the related provision for bad debtswas provided on the grouping basis were analysed as follows:
| Ending balance | Expected credit loss rate in the following 12 months | Provision for bad debts | Reason | |||
| Provided on the grouping basis: | ||||||
| Related party grouping | 294,204,283.58 | - | - | |||
| Non-related party grouping | 1,807,957,046.36 | 0.59% | (10,754,090.54) | Expected credit loss method | ||
| 2,102,161,329.94 | (10,754,090.54) |
As at 30 June 2020 and 31 December 2019, the Group did not have any other receivables at Stage2.
As at 30 June 2020, other receivables at Stage 3 for which the related provision for bad debts wasprovided on the individual basis were analysed as follows:
| Ending balance | Lifetime expected credit losses | Provision for bad debts | Reason | |||
| Provided on the individual basis: | ||||||
| Entrusted loans receivable | 27,000,000.00 | 60.00% | (16,200,000.00) | The debtor encountered financial distress | ||
| Receivables from equity transfer and capital reductions | 101,500,000.00 | 100.00% | (101,500,000.00) | The debtor encountered financial distress | ||
| Others | 7,119,702.75 | 100.00% | (7,119,702.75) | The debtor encountered financial distress, etc. | ||
| 135,619,702.75 | (124,819,702.75) |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(8) Other receivables (Cont’d)
(b) Provision for losses and changes in book balance statements (Cont’d)
As at 31 December 2019, other receivables at Stage 3 for which the related provision for bad debtswas provided on the individual basis were analysed as follows:
| Ending balance | Lifetime expected credit losses | Provision for bad debts | Reason | |||
| Provided on the individual basis: | ||||||
| Entrusted loans receivable | 27,000,000.00 | 60.00% | (16,200,000.00) | The debtor encountered financial distress | ||
| Others | 251,625.60 | 100.00% | (251,625.60) | The debtor encountered financial distress | ||
| 27,251,625.60 | (16,451,625.60) |
As at 30 June 2020 and 31 December 2019, the Group did not have any other receivables at Stage3 for which the related provision for bad debts was provided on the grouping basis.
(c) For the six months ended 30 June 2020, the Group’s provision for bad debts amounted to RMB
114,672,175.85, and there was no provision for bad debts reversed (Note 4(24)).
(d) For the six months ended 30 June 2020, the provision for bad debts of other receivables that was
written off amounted to RMB 8,746,374.22 (Note 4(24)) and no other receivables with amounts thatwere individually significant were written off.
(e) As at 30 June 2020, the five largest other receivables aggregated by debtor were summarised and
analysed as follows:
| 30 June 2020 | |||||||
| Nature of business | Ageing | Amount | Amount of provision for bad debts | % of total balance | |||
| Shenzhen Hive Box Technology Co., Ltd. (“Hive Box Technology”) | Agency collection and payment | Within 3 months | 247,135,969.89 | - | 11.48% | ||
| IKEA | Agency collection and payment | Within 1 year | 69,080,856.55 | (345,404.28) | 3.21% | ||
| Changsha Municipal People's Government | Airlines subsidy | Within 1 year | 43,440,000.00 | (217,200.00) | 2.02% | ||
| Applied Materials (China) Co., Ltd. | Tax collected by others | Within 1 year | 42,424,643.15 | (212,123.22) | 1.97% | ||
| Suzhou Lake District Development Co., Ltd. | Deposit margin | Within 1 year | 40,000,000.00 | (200,000.00) | 1.86% | ||
| 442,081,469.59 | (974,727.50) | 20.54% | |||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(9) Inventories
Inventories are summarised by category as follows:
| 30 June 2020 | |||||
| Ending balance | Provision for decline in the value of inventories | Carrying amount | |||
| Raw materials in stock | 313,877,029.18 | - | 313,877,029.18 | ||
| Aviation consumables | 186,374,332.92 | - | 186,374,332.92 | ||
| Finished goods | 227,732,130.27 | - | 227,732,130.27 | ||
| Properties under development | 79,095,456.31 | - | 79,095,456.31 | ||
| Low-value consumables | 27,337,366.23 | - | 27,337,366.23 | ||
| 834,416,314.91 | - | 834,416,314.91 | |||
| 31 December 2019 | |||||
| Ending balance | Provision for decline in the value of inventories | Carrying amount | |||
| Raw materials in stock | 386,155,813.35 | - | 386,155,813.35 | ||
| Aviation consumables | 184,488,934.08 | - | 184,488,934.08 | ||
| Finished goods | 198,782,950.13 | - | 198,782,950.13 | ||
| Properties under development | 79,095,456.31 | - | 79,095,456.31 | ||
| Low-value consumables | 33,135,819.82 | - | 33,135,819.82 | ||
| 881,658,973.69 | - | 881,658,973.69 | |||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(10) Contract assets
| 30 June 2020 | 31 December 2019 | ||
| Contract assets | 359,294,568.02 | -- | |
| Less: Provision for impairment of contract assets | - | -- | |
| 359,294,568.02 | -- |
(11) Other current assets
| 30 June 2020 | 31 December 2019 | ||
| Input VAT to be offset | 3,275,307,397.97 | 2,608,089,009.64 | |
| Bank wealth management products | 4,143,528,493.16 | 622,533,561.64 | |
| Prepaid enterprise income tax | 59,660,835.60 | 67,680,195.25 | |
| Others | 3,764,114.97 | 1,381,954.41 | |
| 7,482,260,841.70 | 3,299,684,720.94 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(12) Long-term receivables
| 30 June 2020 | 31 December 2019 | ||
| Interest-free loans to employees receivable (a) | 393,004,127.75 | 321,819,622.61 | |
| Deposit for house purchase | 277,904,430.00 | 246,757,710.00 | |
| Finance lease receivables | 9,568,057.34 | 13,269,315.40 | |
| Less: Current portion of long-term receivables | (136,696,803.40) | (105,344,257.09) | |
| Provision for bad debts | (11,698,148.82) | (10,769,078.64) | |
| 532,081,662.87 | 465,733,312.28 |
(a) Interest-free loans to employees receivable
| 30 June 2020 | 31 December 2019 | ||
| Interest-free loans to employees receivable | 433,415,619.28 | 349,400,218.00 | |
| Less: Prepaid discount interest | (40,411,491.53) | (27,580,595.39) | |
| Amortised cost of interest-free loans to employees | 393,004,127.75 | 321,819,622.61 | |
| Less: Current portion of interest-free loans to employees | (136,696,803.40) | (101,130,736.14) | |
| Provision for bad debts | (2,130,091.48) | (1,713,284.19) | |
| 254,177,232.87 | 218,975,602.28 |
Interest-free loans to employees receivable represented the interest-free loans to qualifiedemployees with a term of 5 years.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(13) Long-term equity investments
| 30 June 2020 | 31 December 2019 | ||
| Cost: | |||
| Joint ventures | 1,366,526,871.69 | 1,363,650,397.32 | |
| Associates | 1,024,000,478.05 | 1,018,085,534.62 | |
| 2,390,527,349.74 | 2,381,735,931.94 | ||
| Less: Provision for impairment of long-term equity investments | |||
| - Joint ventures | (22,587,342.22) | (22,587,342.22) | |
| - Associates | (141,505,645.05) | (137,635,916.58) | |
| (164,092,987.27) | (160,223,258.80) | ||
| Joint ventures (a) | 1,343,939,529.47 | 1,341,063,055.10 | |
| Associates (b) | 882,494,833.00 | 880,449,618.04 | |
| 2,226,434,362.47 | 2,221,512,673.14 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(13) Long-term equity investments (Cont’d)
(a) Joint ventures
| Movements in the current period | |||||||||||||||||
| Carrying amount as at 31 December 2019 | Share of net profit/(loss) under equity method | Exchange differences on translation of foreign currency financial statements | Other changes in equity (i) | Carrying amount as at 30 June 2020 | Balance of provision for impairment loss at the end of the period | ||||||||||||
| Increase in investments | Decrease in investments | Provision for impairment loss | |||||||||||||||
| Hubei International Logistics Airport Co., Ltd. | 919,124,467.58 | - | - | (1,806,522.36) | - | - | - | 917,317,945.22 | - | ||||||||
| ZBHA Group Co., Ltd. (“ZBHA”) | 216,803,467.42 | - | - | 3,807,561.60 | - | - | - | 220,611,029.02 | - | ||||||||
| Beijing Wulian Shuntong Technology Co., Ltd. (“Wulian Shuntong”) | 94,963,169.82 | - | - | (3,952,379.53) | - | - | - | 91,010,790.29 | - | ||||||||
| Hubei International Aviation Industry Metro Development Co., Ltd. | 40,595,101.01 | - | - | 384,775.43 | - | - | - | 40,979,876.44 | - | ||||||||
| POST11O? | 25,772,983.59 | - | - | 3,277,245.66 | (152,502.73) | - | - | 28,897,726.52 | - | ||||||||
| CR-SF International Express Co., Ltd. | 24,837,458.98 | - | - | 1,410,908.01 | - | (67,483.26) | - | 26,180,883.73 | - | ||||||||
| Shenzhen Shenghai Information Service Co., Ltd. (“Shenghai Information”) | 8,736,100.81 | - | - | 943,098.27 | - | - | - | 9,679,199.08 | - | ||||||||
| Beijing Shunhetongxin Technology Co., Ltd. | 3,151,501.44 | - | - | (1,689,516.92) | - | - | - | 1,461,984.52 | - | ||||||||
| Global Connect Holding Limited | 2,284,910.20 | - | - | 1,070,397.44 | 52,931.00 | - | - | 3,408,238.64 | - | ||||||||
| Shanghai Geling Information Technology Co., Ltd. (“Geling Information”) | 2,098,546.48 | - | - | (572,696.32) | - | - | - | 1,525,850.16 | - | ||||||||
| Shanghai Pharma DHL Supply Chain (Shanghai) Co., Ltd. | 1,974,388.13 | - | (1,977,476.23) | 3,088.10 | - | - | - | `- | - | ||||||||
| Wenzhou Fengbaoke Technology Co., Ltd. | 720,959.64 | - | - | (696,550.91) | - | - | - | 24,408.73 | - | ||||||||
| REX logistics | - | 2,662,416.86 | - | (273,988.18) | 99,113.44 | - | - | 2,487,542.12 | - | ||||||||
| Zhongyunda Aviation Ground Services Co., Ltd. | - | - | - | - | - | - | - | - | (22,587,342.22) | ||||||||
| CC-SF China Logistics Properties Investment GP Limited | - | 357,315.00 | - | - | (3,260.00) | - | - | 354,055.00 | - | ||||||||
| 1,341,063,055.10 | 3,019,731.86 | (1,977,476.23) | 1,905,420.29 | (3,718.29) | (67,483.26) | - | 1,343,939,529.47 | (22,587,342.22) | |||||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(13) Long-term equity investments (Cont’d)
(b) Associates
| Movements in the current period | ||||||||||||||||||
| Carrying amount as at 31 December 2019 | Increase in investments | Decrease in investments | Share of net profit/(loss) under equity method | Exchange differences on translation of foreign currency financial statements | Adjustment in other comprehensive income | Other changes in equity (i) | Provision for impairment loss | Carrying amount as at 30 June 2020 | Balance of provision for impairment loss at the end of the period | |||||||||
| Zhejiang Galaxis Technology Co., Ltd. | 161,882,794.44 | - | - | 4,342,989.00 | - | - | - | - | 166,225,783.44 | - | ||||||||
| Zhuhai Sui Bian Technology Co., Ltd. (“Zhuhai Sui Bian”) | 112,362,306.63 | - | - | 1,884,371.45 | - | - | - | - | 114,246,678.08 | (8,031,343.63) | ||||||||
| Jiangsu Chiata Foton Co., Ltd. | 107,476,830.50 | - | - | (4,232,253.42) | - | - | - | - | 103,244,577.08 | - | ||||||||
| Beijing Dazhangfang Network Technology Co., Ltd. (“Beijing Dazhangfang”) | 103,704,048.34 | - | - | (6,106,432.20) | - | - | 5,276,959.79 | - | 102,874,575.93 | - | ||||||||
| DHL Weiheng (Zhuhai) Supply Chain Management Co., Ltd. | 63,171,010.36 | - | - | (365,250.63) | - | - | - | - | 62,805,759.73 | - | ||||||||
| Feng Wang Investment Co., Ltd. | 48,457,487.11 | - | - | (808,663.52) | - | 873,013.64 | - | - | 48,521,837.23 | - | ||||||||
| Langxing UAV System Co., Ltd. | 40,463,275.86 | - | - | (441,597.25) | - | - | - | - | 40,021,678.61 | - | ||||||||
| Shenzhen Canbeidou Supply Chain Management Co., Ltd. (“Canbeidou Supply Chain”) | 32,044,873.83 | - | - | (466,908.08) | - | - | - | - | 31,577,965.75 | - | ||||||||
| KOSPA | 26,979,321.88 | - | - | (1,778,514.60) | 476,508.79 | - | - | - | 25,677,316.07 | - | ||||||||
| Beijing GreenValley Technology Limited | 23,280,413.84 | - | - | (33,702.75) | - | - | - | - | 23,246,711.09 | - | ||||||||
| Little Red Hat Issuance Co., Ltd. (“Little Red Hat”) | 19,589,988.00 | - | - | (16,860.91) | - | - | - | - | 19,573,127.09 | (15,000,000.00) | ||||||||
| Shenzhen Zhi Hang UAV Co., Ltd. | 18,053,709.37 | - | - | (167,914.83) | - | - | - | - | 17,885,794.54 | - | ||||||||
| Wuhan Shunluo Supply Chain Management Co., Ltd. | 17,344,007.27 | - | - | (285,969.72) | - | - | - | - | 17,058,037.55 | - | ||||||||
| PT TRIADIBERSAMA | 14,764,955.26 | 10,240,467.14 | - | (5,376,299.46) | 403,195.16 | - | - | - | 20,032,318.10 | - | ||||||||
| GS EXPRESS HOLDINGS PTE.LTD | 14,169,210.35 | - | (14,432,353.74) | 3,233.96 | 259,909.43 | - | - | - | - | - | ||||||||
| Shenzhen Shunjie Fengda Express Co., Ltd. (“Shenzhen Shunjie Fengda”) | 11,743,640.56 | - | - | 985,895.94 | - | - | - | - | 12,729,536.50 | (20,480,557.60) | ||||||||
| Guangdong Shucheng Technology Co., Ltd. | 9,586,857.99 | 11,111,112.00 | - | (578,178.35) | - | - | - | - | 20,119,791.64 | - | ||||||||
| Xi’an Huahan Air Passenger and Freight Service Co., Ltd. | 8,563,952.67 | - | - | (116,012.58) | - | - | - | - | 8,447,940.09 | - | ||||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(13) Long-term equity investments (Cont’d)
(b) Associates (Cont’d)
| Movements in the current period | ||||||||||||||||||
| Carrying amount as at 31 December 2019 | Increase in investments | Decrease in investments | Share of net profit/(loss) under equity method | Exchange differences on translation of foreign currency financial statements | Adjustment in other comprehensive income | Other changes in equity (i) | Provision for impairment loss | Carrying amount as at 30 June 2020 | Balance of provision for impairment loss at the end of the period | |||||||||
| Zhongshun Xintean Supply Chain Co., Ltd. | 7,271,247.64 | - | - | (170,462.11) | - | - | - | - | 7,100,785.53 | - | ||||||||
| ASL of Indonesia | 5,680,228.00 | - | - | (174,707.63) | 75,252.09 | - | - | - | 5,580,772.46 | - | ||||||||
| Shanghai Jujia Logistics Development Co., Ltd. | 5,000,000.00 | 5,000,000.00 | - | (419,084.54) | - | - | - | - | 9,580,915.46 | - | ||||||||
| Chongqing Boqiang Logistics Co., Ltd. | 4,444,827.25 | - | - | (55,385.78) | - | - | - | - | 4,389,441.47 | - | ||||||||
| Beijing Prettyfeather Brand Management Co., Ltd. | 4,038,975.21 | - | - | (169,246.74) | - | - | - | (3,869,728.47) | - | (3,869,728.47) | ||||||||
| Kin Shun Information Technology Limited | 3,782,528.57 | - | - | (3,812,638.44) | 30,109.87 | - | - | - | - | - | ||||||||
| Shenzhen Zhongwang Finance and Tax Management Co., Ltd. | 3,776,552.80 | - | - | (321,934.86) | - | - | - | - | 3,454,617.94 | - | ||||||||
| Wuhan Jinyu DHL Supply Chain Management Co., Ltd. | 3,575,499.44 | - | - | (73,375.39) | - | - | - | - | 3,502,124.05 | - | ||||||||
| Qingdao Dakai Cargo Agency Co., Ltd. | 3,076,701.10 | - | - | (442.63) | - | - | - | - | 3,076,258.47 | - | ||||||||
| KINGS (HK) INTERNATIONAL LIMITED | 2,425,798.14 | - | - | (75,933.80) | 43,709.32 | - | - | - | 2,393,573.66 | - | ||||||||
| Qingdao Shunlianda Agricultural Science and Technology Co., Ltd. | 2,371,202.69 | - | - | (1,119,412.16) | - | - | - | - | 1,251,790.53 | - | ||||||||
| Shenzhen Fengyi Intelligent Technology Co., Ltd. | 1,000,000.00 | - | - | (67,206.23) | - | - | - | - | 932,793.77 | - | ||||||||
| Shenzhen Xiaofeng Technology Co., Ltd. (“Xiaofeng Technology”) | 367,372.94 | - | - | (43,757.19) | - | - | - | - | 323,615.75 | (847,730.80) | ||||||||
| Shenzhen Bai Mi Life Co., Ltd. | - | - | - | - | - | - | - | - | - | (93,276,284.55) | ||||||||
| Xiaoyi Technology (Shanghai) Co., Ltd. | - | 3,000,000.00 | - | (45,743.22) | - | - | - | - | 2,954,256.78 | - | ||||||||
| Shenzhen Changfeng Electronic Information Co., Ltd. | - | 400,000.00 | - | (47,843.58) | - | - | - | - | 352,156.42 | - | ||||||||
| Shenzhen Tianhui Digital Technology Co., Ltd. | - | 1,510,000.00 | - | (197,697.81) | - | - | - | - | 1,312,302.19 | - | ||||||||
| Shanghai Tingdi Logistics Service Co., Ltd. | - | 2,000,000.00 | - | - | - | - | - | - | 2,000,000.00 | - | ||||||||
| 880,449,618.04 | 33,261,579.14 | (14,432,353.74) | (20,352,940.06) | 1,288,684.66 | 873,013.64 | 5,276,959.79 | (3,869,728.47) | 882,494,833.00 | (141,505,645.05) | |||||||||
(i) Those represent changes in equity resulting from capital injections by investors other than the Group.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(14) Investments in other equity instruments
| 30 June 2020 | 31 December 2019 | ||
| Equity of listed companies | 867,696,433.34 | 806,383,940.40 | |
| Equity of unlisted companies | 4,191,307,983.06 | 4,127,308,996.79 | |
| 5,059,004,416.40 | 4,933,692,937.19 |
| Item | Dividend income recognised in the current period | Accumulated gains or losses recognised in other comprehensive income | |
| Equity of listed companies | 1,110,356.12 | 112,686,613.08 | |
| Equity of unlisted companies | - | 992,291,278.37 | |
| 1,110,356.12 | 1,104,977,891.45 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(14) Investments in other equity instruments (Cont’d)
| 31 December 2019 | Increase in the current period | Changes in fair value in the current period | Exchange rate changes in the current period | Exchange differences on translation of foreign currency financial statements | 30 June 2020 | ||||||
| Equity of listed companies | 806,383,940.40 | - | 49,338,455.33 | - | 11,974,037.61 | 867,696,433.34 | |||||
| Equity of unlisted companies | 4,127,308,996.79 | 500,000.00 | - | (10,728,054.93) | 74,227,041.20 | 4,191,307,983.06 | |||||
| 4,933,692,937.19 | 500,000.00 | 49,338,455.33 | (10,728,054.93) | 86,201,078.81 | 5,059,004,416.40 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(15) Other non-current financial assets
| 30 June 2020 | 31 December 2019 | ||
| Financial assets held for trading (over 1 year): | |||
| Industry fund investments | 275,846,467.40 | 218,615,943.17 | |
| Special scheme equity-class securities | 260,424,488.45 | 260,424,488.45 | |
| 536,270,955.85 | 479,040,431.62 |
(16) Investment properties
| Buildings | Land use rights | Total | |||
| Cost | |||||
| 31 December 2019 | 1,242,691,385.60 | 943,851,986.13 | 2,186,543,371.73 | ||
| Transfer from self-used assets in the current period (Note 4(17), (18), (19)) | 895,763,440.09 | 148,873,230.69 | 1,044,636,670.78 | ||
| Transfer to self-used assets in the current period (Note 4(17), (19)) | (724,802,792.04) | (235,331,210.09) | (960,134,002.13) | ||
| Effect of translation of foreign currency financial statements | 8,413,725.83 | 11,883,607.41 | 20,297,333.24 | ||
| 30 June 2020 | 1,422,065,759.48 | 869,277,614.14 | 2,291,343,373.62 | ||
| Accumulated depreciation | |||||
| 31 December 2019 | 80,869,528.27 | 86,147,942.85 | 167,017,471.12 | ||
| Transfer from self-used assets in the current period (Note 4(17), (19)) | 6,297,357.09 | 12,359,704.46 | 18,657,061.55 | ||
| Provision in the current period | 15,944,655.33 | 11,306,455.48 | 27,251,110.81 | ||
| Transfer to self-used assets in the current period (Note 4(17), (19)) | (21,260,310.46) | (22,082,087.43) | (43,342,397.89) | ||
| Effect of translation of foreign currency financial statements | 908,211.70 | 1,109,758.48 | 2,017,970.18 | ||
| 30 June 2020 | 82,759,441.93 | 88,841,773.84 | 171,601,215.77 | ||
| Carrying amount | |||||
| 30 June 2020 | 1,339,306,317.55 | 780,435,840.30 | 2,119,742,157.85 | ||
| 31 December 2019 | 1,161,821,857.33 | 857,704,043.28 | 2,019,525,900.61 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(16) Investment properties (Cont’d)
As at 30 June 2020, the Group was still in the process of applying for certificates of ownership forcertain buildings with carrying amount of RMB 391,187,118.50 (cost of RMB 401,018,242.29)(31December 2019: carrying amount of RMB 365,383,308.15 and cost of RMB 374,700,631.83). As at30 June 2020, the Group had no land use rights without certificates of ownership (31 December2019: carrying amount of RMB 9,641,930.52 and cost of RMB 9,924,283.34).
As at 30 June 2020, investment properties with carrying amount of RMB 203,339,490.96 (cost ofRMB 216,803,387.46) (31 December 2019: carrying amount of RMB 260,204,371.91 and cost ofRMB 275,172,362.41) were pledged as collateral for long-term borrowings (Note 4(34)(b)).
As at 30 June 2020 and 31 December 2019, the Group assessed that no impairment loss should berecognised for investment properties.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(17) Fixed assets
| Buildings | Motor vehicles | Computers and electronic equipment | Aircraft, aircraft engines, rotables and high-value maintenance tools | Machinery and equipment | Office equipment and other equipment | Total | |||||||
| Cost | |||||||||||||
| 31 December 2019 | 7,393,215,121.80 | 5,091,728,471.87 | 3,216,929,397.29 | 7,801,375,592.49 | 3,070,600,492.08 | 4,143,569,817.71 | 30,717,418,893.24 | ||||||
| Transfer from construction in progress (Note 4(18)) | 2,446,302.31 | 16,953,835.16 | 8,601,224.88 | 547,430,011.15 | 92,956,861.99 | 353,934,950.73 | 1,022,323,186.22 | ||||||
| Transfer from investment properties in the current period (Note 4(16)) | 724,802,792.04 | - | - | - | - | - | 724,802,792.04 | ||||||
| Increase in the current period | 96,286,214.03 | 222,201,220.42 | 321,025,826.81 | 91,191,809.46 | 67,174,026.30 | 50,190,651.80 | 848,069,748.82 | ||||||
| Transfer to investment properties in the current period (Note 4(16)) | (55,116,860.10) | - | - | - | - | - | (55,116,860.10) | ||||||
| Decrease in the current period | - | (236,411,428.59) | (172,579,051.07) | (21,141,538.70) | (10,522,712.85) | (39,354,791.98) | (480,009,523.19) | ||||||
| Decrease due to disposal of subsidiaries in the current period | - | - | (1,001,708.18) | - | - | (8,904.89) | (1,010,613.07) | ||||||
| Effect of translation of foreign currency financial statements | 26,261,014.74 | 3,308,529.06 | 477,970.50 | 100,516.39 | 3,682,485.58 | (516,031.45) | 33,314,484.82 | ||||||
| 30 June 2020 | 8,187,894,584.82 | 5,097,780,627.92 | 3,373,453,660.23 | 8,418,956,390.79 | 3,223,891,153.10 | 4,507,815,691.92 | 32,809,792,108.78 | ||||||
| Accumulated depreciation | |||||||||||||
| 31 December 2019 | 714,065,052.65 | 3,517,214,219.88 | 1,955,602,800.09 | 2,584,195,303.06 | 928,504,641.35 | 2,114,009,813.79 | 11,813,591,830.82 | ||||||
| Transfer from investment properties in the current period (Note 4(16)) | 21,260,310.46 | - | - | - | - | - | 21,260,310.46 | ||||||
| Provision in the current period | 119,767,561.58 | 380,309,057.17 | 319,857,700.96 | 457,374,244.57 | 130,636,255.76 | 346,747,086.69 | 1,754,691,906.73 | ||||||
| Transfer to investment properties in the current period (Note 4(16)) | (6,297,357.09) | - | - | - | - | - | (6,297,357.09) | ||||||
| Decrease in the current period | - | (218,446,240.58) | (153,026,756.03) | (16,307,648.06) | (4,369,548.82) | (32,715,537.29) | (424,865,730.78) | ||||||
| Decrease due to disposal of subsidiaries in the current period | - | - | (401,917.47) | - | - | (1,846.41) | (403,763.88) | ||||||
| Effect of translation of foreign currency financial statements | 2,864,356.41 | 2,827,704.50 | 222,640.25 | 7,383.10 | 357,390.23 | (257,544.21) | 6,021,930.28 | ||||||
| 30 June 2020 | 851,659,924.01 | 3,681,904,740.97 | 2,122,254,467.80 | 3,025,269,282.67 | 1,055,128,738.52 | 2,427,781,972.57 | 13,163,999,126.54 | ||||||
| Carrying amount | |||||||||||||
| 30 June 2020 | 7,336,234,660.81 | 1,415,875,886.95 | 1,251,199,192.43 | 5,393,687,108.12 | 2,168,762,414.58 | 2,080,033,719.35 | 19,645,792,982.24 | ||||||
| 31 December 2019 | 6,679,150,069.15 | 1,574,514,251.99 | 1,261,326,597.20 | 5,217,180,289.43 | 2,142,095,850.73 | 2,029,560,003.92 | 18,903,827,062.42 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(17) Fixed assets (Cont’d)
(i) For the sixth months ended 30 June 2020, the amount of depreciation expenses charged to cost of
revenue, selling and distribution expenses, general and administrative expenses and research anddevelopment expenses was RMB 1,730,365,263.08 (for the sixth months ended 30 June 2019:
RMB 1,421,439,131.46).
(ii) As at 30 June 2020, fixed assets with carrying amount of RMB 71,487,996.45 (cost of RMB
76,204,481.36) (31 December 2019: carrying amount of RMB 249,515,825.00 and cost of RMB263,866,480.94) were pledged as collateral for long-term borrowings (Note 4(34)(b)).
(iii) Fixed assets with pending certificates of ownership
| 30 June 2020 | |||||||
| Cost | Accumulated depreciation | Provision for impairment loss | Carrying amount | ||||
| Buildings | 4,361,944,192.02 | (74,616,602.27) | - | 4,287,327,589.75 | |||
| 31 December 2019 | |||||||
| Cost | Accumulated depreciation | Provision for impairment loss | Carrying amount | ||||
| Buildings | 3,832,878,464.87 | (7,512,115.30) | - | 3,825,366,349.57 | |||
In addition, as at 30 June 2020, buildings with carrying amount of RMB 23,078,809.94 and cost ofRMB 29,844,036.64 (31 December 2019: carrying amount of RMB 23,782,253.69 and cost of RMB29,844,036.64) represented public rental houses with restricted property rights purchased by theGroup for enterprise talents.
(iv) As at 30 June 2020 and 31 December 2019, the Group assessed that no impairment loss should be
recognised for fixed assets.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(17) Fixed assets (Cont’d)
(v) Disposal of aircraft engines, rotables and high-value aero maintenance tools
| For the six months ended 30 June 2020 | |||||||||
| Reason for disposal | Cost | Accumulated depreciation | Provision for impairment loss | Carrying amount | |||||
| Aircraft rotables | Scrapped | 6,029,229.78 | (2,345,065.20) | - | 3,684,164.58 | ||||
| Aircraft rotables | Sold | 49,595.58 | (9,868.98) | - | 39,726.60 | ||||
| High-value aero maintenance tools | Scrapped | 34,126.62 | (22,908.94) | - | 11,217.68 | ||||
| 6,112,951.98 | (2,377,843.12) | - | 3,735,108.86 | ||||||
| For the six months ended 30 June 2019 | |||||||||
| Reason for disposal | Cost | Accumulated depreciation | Provision for impairment loss | Carrying amount | |||||
| Aircraft rotables | Scrapped | 459,094.82 | (148,092.22) | - | 311,002.60 | ||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(18) Construction in progress
| (19) | 30 June 2020 | 31 December 2019 | |
| Qianhai S.F. Headquarters Office | 640,806,994.38 | 613,625,693.09 | |
| Aircraft import and refit | 577,463,381.87 | 316,317,636.93 | |
| Wuhan E-Commerce Industrial Park Project | 433,404,820.46 | 316,888,129.83 | |
| Foshan Guicheng Fengtai E-Commerce Industrial Park Project | 213,692,312.84 | 166,000,698.78 | |
| Tianjin Fengtai E-Commerce Industrial Park Project | 177,315,966.19 | 293,070,248.84 | |
| Zhengzhou E-Commerce Industrial Park Project | 154,343,744.60 | 76,581,451.75 | |
| Chengdu Fengtai E-Commerce Industrial Park Project | 121,854,647.49 | 18,618,059.67 | |
| Xi’an E-Commerce Industrial Park Project | 108,499,854.12 | 38,419,568.13 | |
| S.F. Nanjing Innovation Industrial Park Project | 107,690,187.20 | 64,145,993.56 | |
| Weihai S.F. E-Commerce Industrial Park Project | 90,187,720.52 | 91,088,518.37 | |
| Ezhou Civil Airport Transit Centre | 87,159,832.21 | 7,532,195.76 | |
| Changchun E-Commerce Industrial Park Project | 86,712,713.29 | 169,493,927.07 | |
| Beijing S.F. Full-automatic Storage & Sorting Centre and Supporting Facilities Project | 83,992,159.18 | 22,441,091.92 | |
| Industrial Buildings in Dongguan Songshan Lake Zhigu Industrial Park | 57,746,221.76 | 55,700,314.11 | |
| Changsha E-Commerce Industrial Park Project | 54,729,880.15 | 61,192,813.43 | |
| Hangzhou Beicheng Intelligent Park | 54,004,646.26 | 1,405,340.94 | |
| Guiyang Fengtai E-Commerce Industrial Park | 52,826,230.53 | 4,813,433.58 | |
| Relocation Project of Tianjin Distribution Hub | 50,857,896.96 | - | |
| Fengnong Fruits Centralised Processing Project | 40,136,297.61 | - | |
| Dongguan Humen Distribution Hub Project | 21,509,161.89 | 32,910,637.62 | |
| Ganzhou Fengtai Industrial Park Project | 21,145,281.02 | 3,123,497.70 | |
| Intelligent Sorting Hefei Base Project | 19,116,226.33 | 239,469,936.44 | |
| Hefei Baohe Distribution Hub Project | 10,168,688.71 | 31,211,646.90 | |
| Chongqing Fengtai E-Commerce Industrial Park Project | - | 245,524,145.25 | |
| S.F. Ma’anshan Innovation Industrial Park Project | - | 21,659,696.90 | |
| Others | 307,980,506.22 | 225,255,941.69 | |
| 3,573,345,371.79 | 3,116,490,618.26 |
As at 30 June 2020, the Group considered that no impairment loss should be recognised forconstruction in progress.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(18) Construction in progress (Cont’d)
| Name of projects | Budget | 31 December 2019 | Increase in the current period | Transfer to long-term assets in the current period (iii) | Transfer to long-term prepaid expenses in the current period | 30 June 2020 | % of project investment in budget (ii) | Progress of project | Accumulative amount of capitalised borrowing costs | Including: Borrowing costs capitalised in the current period (Note 4(53)) | Capitalisation rate | Source of funds | |||||
| Qianhai S.F. Headquarters Office | 698,847,964.81 | 613,625,693.09 | 27,181,301.29 | - | - | 640,806,994.38 | 91.69% | 91.69% | 68,780,176.84 | 10,137,901.97 | 4.64% | Self-owned funds and loans from financial institutions | |||||
| Aircraft import and refit | 2,000,923,805.45 | 316,317,636.93 | 841,047,490.31 | (547,430,011.15) | (32,471,734.22) | 577,463,381.87 | 42.03% | 42.03% | - | - | - | Self-owned funds | |||||
| Wuhan E-Commerce Industrial Park Project | 774,094,016.55 | 316,888,129.83 | 116,516,690.63 | - | - | 433,404,820.46 | 55.99% | 55.99% | - | - | - | Self-owned funds | |||||
| Foshan Guicheng Fengtai E-Commerce Industrial Park Project | 250,286,227.21 | 166,000,698.78 | 47,691,614.06 | - | - | 213,692,312.84 | 85.38% | 85.38% | - | - | - | Self-owned funds | |||||
| Tianjin Fengtai E-Commerce Industrial Park Project | 697,197,577.13 | 293,070,248.84 | 41,928,989.38 | (157,683,272.03) | - | 177,315,966.19 | 92.84% | 92.84% | - | - | - | Self-owned funds | |||||
| Zhengzhou E-Commerce Industrial Park Project | 205,609,602.39 | 76,581,451.75 | 77,762,292.85 | - | - | 154,343,744.60 | 75.07% | 75.07% | - | - | - | Self-owned funds | |||||
| Chengdu Fengtai E-Commerce Industrial Park Project | 520,006,775.06 | 18,618,059.67 | 103,236,587.82 | - | - | 121,854,647.49 | 23.43% | 23.43% | - | - | - | Self-owned funds | |||||
| Xi’an E-Commerce Industrial Park Project | 504,029,639.50 | 38,419,568.13 | 70,080,285.99 | - | - | 108,499,854.12 | 21.53% | 21.53% | - | - | - | Self-owned funds | |||||
| S.F. Nanjing Innovation Industrial Park Project | 207,366,137.93 | 64,145,993.56 | 43,544,193.64 | - | - | 107,690,187.20 | 51.93% | 51.93% | - | - | - | Self-owned funds | |||||
| Weihai S.F. E-Commerce Industrial Park Project | 116,927,890.45 | 91,088,518.37 | - | - | (900,797.85) | 90,187,720.52 | 77.90% | 77.90% | - | - | - | Self-owned funds | |||||
| Ezhou Civil Airport Transit Centre | 1,450,260,000.00 | 7,532,195.76 | 79,627,636.45 | - | - | 87,159,832.21 | 6.01% | 6.01% | - | - | - | Self-owned funds | |||||
| Changchun E-Commerce Industrial Park Project | 388,818,464.54 | 169,493,927.07 | 6,742,605.41 | (89,523,819.19) | - | 86,712,713.29 | 45.33% | 45.33% | - | - | - | Self-owned funds | |||||
| Beijing S.F. Full-automatic Storage & Sorting Centre and Supporting Facilities Project | 386,965,179.91 | 22,441,091.92 | 61,551,067.26 | - | - | 83,992,159.18 | 21.71% | 21.71% | - | - | - | Self-owned funds | |||||
| Industrial Buildings in Dongguan Songshan Lake Zhigu Industrial Park | 472,698,248.79 | 55,700,314.11 | 2,045,907.65 | - | - | 57,746,221.76 | 96.12% | 96.12% | - | - | - | Self-owned funds | |||||
| Changsha E-Commerce Industrial Park Project | 466,809,300.38 | 61,192,813.43 | 33,156,696.73 | (39,619,630.01) | - | 54,729,880.15 | 67.47% | 67.47% | - | - | - | Self-owned funds | |||||
| Hangzhou Beicheng Intelligent Park | 428,880,944.89 | 1,405,340.94 | 52,599,305.32 | - | - | 54,004,646.26 | 12.59% | 12.59% | - | - | - | Self-owned funds | |||||
| Guiyang Fengtai E-Commerce Industrial Park | 349,832,788.25 | 4,813,433.58 | 48,012,796.95 | - | - | 52,826,230.53 | 15.10% | 15.10% | - | - | - | Self-owned funds | |||||
| Relocation Project of Tianjin Distribution Hub | 98,249,739.09 | - | 50,857,896.96 | - | - | 50,857,896.96 | 51.76% | 51.76% | - | - | - | Self-owned funds | |||||
| Fengnong Fruits Centralised Processing Project | 45,319,665.37 | - | 40,136,297.61 | - | - | 40,136,297.61 | 88.56% | 88.56% | - | - | - | Self-owned funds | |||||
| Dongguan Humen Distribution Hub Project | 52,699,954.47 | 32,910,637.62 | 9,499,910.73 | (12,526,849.12) | (8,374,537.34) | 21,509,161.89 | 80.48% | 80.48% | - | - | - | Self-owned funds | |||||
| Ganzhou Fengtai Industrial Park Project | 248,268,422.40 | 3,123,497.70 | 18,021,783.32 | - | - | 21,145,281.02 | 8.52% | 8.52% | - | - | - | Self-owned funds | |||||
| Intelligent Sorting Hefei Base Project | 640,594,804.03 | 239,469,936.44 | 2,434,810.97 | (222,788,521.08) | - | 19,116,226.33 | 61.71% | 61.71% | - | - | - | Self-owned funds | |||||
| Hefei Baohe Distribution Hub Project | 60,305,309.73 | 31,211,646.90 | 8,587,227.45 | (29,630,185.64) | - | 10,168,688.71 | 66.00% | 66.00% | - | - | - | Self-owned funds | |||||
| Chongqing Fengtai E-Commerce Industrial Park Project | 298,671,587.86 | 245,524,145.25 | 9,121,029.65 | (254,645,174.90) | - | - | 85.26% | 85.26% | - | - | - | Self-owned funds | |||||
| S.F. Ma’anshan Innovation Industrial Park Project | 136,222,593.52 | 21,659,696.90 | 4,149,548.85 | (25,809,245.75) | - | - | 94.47% | 94.47% | - | - | - | Self-owned funds | |||||
| Others | 225,255,941.69 | 611,034,849.48 | (483,313,057.34) | (44,997,227.61) | 307,980,506.22 | - | - | - | Self-owned funds | ||||||||
| 3,116,490,618.26 | 2,406,568,816.76 | (1,862,969,766.21) | (86,744,297.02) | 3,573,345,371.79 | 68,780,176.84 | 10,137,901.97 | 4.64% |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(18) Construction in progress (Cont’d)
(i) As at 30 June 2020, construction in progress with carrying amount of RMB 157,683,272.03 (31 December 2019: RMB 171,224,485.06) were pledged as
collateral for long-term borrowings (Note 4(34)(b)).
(ii) For aircraft import and refit, the percentage of project investment in budget is related to the investment for the current period; for the other projects, the
percentage of project investment in budget is related to the accumulative investment.
(iii) The construction in progress transferred to long-term assets for the current period amounted to RMB 1,862,969,766.21, including RMB 1,022,323,186.22
transferred to fixed assets and RMB 840,646,579.99 transferred to investment properties.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(19) Intangible assets
| Land use rights | Purchased software | Self-developed software | Patents | Trademark rights | Customer relationships | Others | Total | ||||||||
| Cost | |||||||||||||||
| 31 December 2019 | 5,474,502,965.31 | 511,321,828.19 | 2,875,846,805.97 | 15,543,605.12 | 236,061,827.88 | 2,710,578,325.00 | 105,616,019.64 | 11,929,471,377.11 | |||||||
| Transfer from investment properties in the current period (Note 4(16)) | 235,331,210.09 | - | - | - | - | - | - | 235,331,210.09 | |||||||
| Transfer from capitalised development expenditures in the current period (Note 4(20)) | - | - | 528,205,220.60 | - | - | - | - | 528,205,220.60 | |||||||
| Addition in the current period | 17,913,095.99 | 11,771,190.44 | - | 2,224,090.43 | 333,213.46 | - | 3,234,233.22 | 35,475,823.54 | |||||||
| Transfer to investment properties in the current period (Note 4(16)) | (148,873,230.69) | - | - | - | - | - | - | (148,873,230.69) | |||||||
| Disposal in the current period | - | (22,317,260.85) | (37,404,672.22) | - | - | - | (25,317.96) | (59,747,251.03) | |||||||
| Effect of translation of foreign currency financial statements | 35,094,326.10 | (132,566.06) | - | (88,946.40) | 4,208,542.98 | 49,714,455.19 | 269,241.18 | 89,065,052.99 | |||||||
| 30 June 2020 | 5,613,968,366.80 | 500,643,191.72 | 3,366,647,354.35 | 17,678,749.15 | 240,603,584.32 | 2,760,292,780.19 | 109,094,176.08 | 12,608,928,202.61 | |||||||
| Accumulated amortisation | |||||||||||||||
| 31 December 2019 | 460,386,321.83 | 342,788,423.42 | 903,112,992.48 | 3,674,397.90 | 17,911,578.99 | 143,915,537.75 | 19,532,258.90 | 1,891,321,511.27 | |||||||
| Transfer from investment properties in the current period (Note 4(16)) | 22,082,087.43 | - | - | - | - | - | - | 22,082,087.43 | |||||||
| Provision in the current period | 62,675,556.60 | 17,950,921.21 | 324,444,726.82 | 843,965.20 | 6,137,846.20 | 78,336,196.44 | 8,017,824.23 | 498,407,036.70 | |||||||
| Transfer to investment properties in the current period (Note 4(16)) | (12,359,704.46) | - | - | - | - | - | - | (12,359,704.46) | |||||||
| Disposal in the current period | - | (6,787,554.37) | (9,402,633.97) | - | - | - | - | (16,190,188.34) | |||||||
| Effect of translation of foreign currency financial statements | 3,307,197.88 | 565,290.79 | - | (91,959.34) | 340,713.56 | 3,213,816.92 | 67,268.81 | 7,402,328.62 | |||||||
| 30 June 2020 | 536,091,459.28 | 354,517,081.05 | 1,218,155,085.33 | 4,426,403.76 | 24,390,138.75 | 225,465,551.11 | 27,617,351.94 | 2,390,663,071.22 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(19) Intangible assets (Cont’d)
| Land use rights | Purchased software | Self-developed software | Patents | Trademark rights | Customer relationships | Others | Total | |||||||
| Provision for impairment loss | ||||||||||||||
| 31 December 2019 | - | - | 30,113,509.80 | - | - | - | - | 30,113,509.80 | ||||||
| Increase in the current period (d) | - | - | 23,599,356.05 | - | - | - | - | 23,599,356.05 | ||||||
| 30 June 2020 | - | - | 53,712,865.85 | - | - | - | - | 53,712,865.85 | ||||||
| Carrying amount | ||||||||||||||
| 30 June 2020 | 5,077,876,907.52 | 146,126,110.67 | 2,094,779,403.17 | 13,252,345.39 | 216,213,445.57 | 2,534,827,229.08 | 81,476,824.14 | 10,164,552,265.54 |
| 31 December 2019 | 5,014,116,643.48 | 168,533,404.77 | 1,942,620,303.69 | 11,869,207.22 | 218,150,248.89 | 2,566,662,787.25 | 86,083,760.74 | 10,008,036,356.04 |
For the sixth months ended 30 June 2020, the amount of amortisation expenses charged to cost of revenue, selling and distribution expenses, general andadministrative expenses and research and development expenses was RMB 457,822,929.32 (for the sixth months ended 30 June 2019: RMB317,407,225.33).
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(19) Intangible assets (Cont’d)
(a) The Group’s land use rights pledged as collateral for long-term borrowings (Note 4(34)(b)):
| 30 June 2020 | |||||
| Cost | Accumulated amortisation | Carrying amount | |||
| Land use rights | 1,438,825,054.85 | (171,623,087.88) | 1,267,201,966.97 | ||
| 31 December 2019 | |||||
| Cost | Accumulated amortisation | Carrying amount | |||
| Land use rights | 1,403,515,678.80 | (153,966,421.27) | 1,249,549,257.53 | ||
(b) As at 30 June 2020, the Group was still in the process of applying for certificates of ownership for
land use rights with carrying amount of RMB 241,433,971.92 (cost of RMB 256,460,172.33) (31December 2019: carrying amount of RMB 359,996,671.97 and cost of RMB 366,392,599.88).
(c) As at 30 June 2020, the intangible assets developed by the Group accounted for 20.61% (31
December 2019: 19.41%) of the carrying amount of intangible assets.
| 30 June 2020 | 31 December 2019 | ||
| Carrying amount of self-developed intangible assets | 2,094,779,403.17 | 1,942,620,303.69 | |
| Carrying amount of intangible assets | 10,164,552,265.54 | 10,008,036,356.04 | |
| Proportion | 20.61% | 19.41% |
(d) For the six months ended 30 June 2020, due to the discontinuation or upcoming discontinuation of
some self-developed software, the Group made a provision for impairment loss of RMB23,599,356.05 upon assessment (for the six months ended 30 June 2019: RMB 37,001,101.69).
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(20) Capitalised development expenditures
| 31 December 2019 | Increase in the current period | Transfer to intangible assets in the current period (Note 4(19)) | 30 June 2020 | ||||
| Unmanned Aerial Vehicle Project | 72,918,596.25 | 12,089,314.52 | - | 85,007,910.77 | |||
| Fengsheng System | 40,743,943.72 | 19,615,963.75 | (27,621,426.89) | 32,738,480.58 | |||
| CPS | 34,216,570.01 | 25,256,801.34 | (27,723,295.09) | 31,750,076.26 | |||
| Foundation Revolution Project of Product Operation | 20,263,124.51 | 8,610,609.89 | (7,211,555.98) | 21,662,178.42 | |||
| Quick Delivery System | 13,858,061.23 | 9,055,530.97 | (1,299,482.82) | 21,614,109.38 | |||
| Intra-city Express | 15,592,405.62 | 29,231,968.52 | (24,696,373.94) | 20,128,000.20 | |||
| New Generation Maintenance System | 13,578,905.59 | 5,788,485.81 | - | 19,367,391.40 | |||
| Car-free Carriage Platform | 5,389,841.11 | 22,782,737.66 | (9,875,471.48) | 18,297,107.29 | |||
| Warehousing Management System Project | 14,088,760.28 | 9,076,395.41 | (6,591,696.39) | 16,573,459.30 | |||
| International Business System | 11,262,048.03 | 25,598,480.01 | (21,595,378.58) | 15,265,149.46 | |||
| Digital Repository Project | 6,321,579.17 | 11,483,871.03 | (4,461,046.61) | 13,344,403.59 | |||
| Geographic Information System Project | 11,331,994.60 | 2,868,078.85 | (1,700,981.65) | 12,499,091.80 | |||
| Fengchi Project | 14,350,285.10 | 12,758,413.62 | (16,361,210.56) | 10,747,488.16 | |||
| Claim Risk Control Project | 9,117,450.03 | 1,508,762.52 | (97,205.90) | 10,529,006.65 | |||
| Customer Experience Project | 10,147,670.43 | 6,247,604.34 | (7,435,638.24) | 8,959,636.53 | |||
| Big Data Platform Project | 4,507,666.55 | 14,985,615.69 | (12,022,733.80) | 7,470,548.44 | |||
| Settlement Platform System | 25,836,659.51 | 6,700,266.80 | (25,187,784.42) | 7,349,141.89 | |||
| Refrigerated Transport System Project | 6,609,491.19 | 6,706,496.21 | (8,702,473.74) | 4,613,513.66 | |||
| Operation and Management Platform Virtual System | 3,415,470.74 | 6,054,201.08 | (5,225,617.46) | 4,244,054.36 | |||
| Others | 249,077,453.53 | 316,764,848.56 | (320,395,847.05) | 245,446,455.04 | |||
| 582,627,977.20 | 553,184,446.58 | (528,205,220.60) | 607,607,203.18 |
As at 30 June 2020, the Group assessed that no impairment loss should be recognised forcapitalised development expenditures.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(21) Goodwill
| 31 December 2019 | Increase in the current period | Decrease in the current period | Exchange differences on translation of foreign currency financial statements | 30 June 2020 | |||||
| Cost: | |||||||||
| DHL Supply Chain (Hong Kong) Co., Ltd. (“DHL HK”) and DHL Logistics (Beijing) Co., Ltd. (“DHL BJ”) | 3,040,084,262.82 | - | - | 55,862,021.37 | 3,095,946,284.19 | ||||
| Havi Logistics Services (Hong Kong) Ltd. (“Havi Hong Kong”) | 362,722,412.14 | - | - | 6,652,656.72 | 369,375,068.86 | ||||
| Guangdong Shunxin Freight Co., Ltd. (“Guangdong Shunxin”) | 149,587,124.73 | - | - | - | 149,587,124.73 | ||||
| Suzhou Hengding Logistics Co., Ltd. | 5,677,452.73 | - | - | - | 5,677,452.73 | ||||
| Sichuan Wu Lian Yi Da Technology Co., Ltd. (“Wu Lian Yi Da”) | 4,940,247.25 | - | - | - | 4,940,247.25 | ||||
| Chengdu Shunyifeng Pharmaceuticals Co., Ltd. | 2,434,509.81 | - | - | - | 2,434,509.81 | ||||
| Hanxing Industrial Co., Ltd. | 1,528,959.13 | - | - | 28,042.49 | 1,557,001.62 | ||||
| 3,566,974,968.61 | - | - | 62,542,720.58 | 3,629,517,689.19 | |||||
| Less: Provisions for impairment loss (Note 4(24)) | |||||||||
| Chengdu Shunyifeng Pharmaceuticals Co., Ltd. | (2,434,509.81) | - | - | - | (2,434,509.81) | ||||
| 3,564,540,458.80 | - | - | 62,542,720.58 | 3,627,083,179.38 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(21) Goodwill (Cont’d)
During the goodwill impairment assessment, the Group compares the carrying amount of the relevant assets or sets of asset groups (including goodwill) withtheir recoverable amount. If the recoverable amount is lower than the carrying amount, the difference shall be recognised in profit or loss for the currentperiod.
The Group’s allocation of goodwill was not changed for the six months ended 30 June 2020.
The recoverable amounts of DHL HK and DHL BJ are calculated based on the nine-year forecast approved by management, together with a long-termgrowth rate in the remaining forecast period.
The main assumptions applied by management in cash flows projections for DHL HK and DHL BJ are as follows:
| DHL HK and DHL BJ | |
| Revenue growth rates in the first nine-year forecast period | 3%~29% |
| Long-term growth rate | 3.00% |
| Profit margin | 1.7%~8.8% |
| Pre-tax discount rate | 11.80% |
The Group determined revenue growth rates and profit margin based on past performance and expectations of market development. Long-term growth rateis for the remaining forecast period which exclude first nine-year forecast period. According to the long-term inflation rate of Mainland China and Hong Kong,the Group adopts a long-term growth rate of 3%. The discount rate adopted by the management is the pre-tax interest rates which is able to reflect the risksspecific to the related asset groups and sets of asset groups.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(22) Long-term prepaid expenses
| 31 December 2019 | Increase in the current period | Amortisation in the current period | Decrease in the current period | 30 June 2020 | |||||
| Leasehold improvements | 1,168,505,861.57 | 183,592,368.23 | (345,252,630.42) | (10,880,367.36) | 995,965,232.02 | ||||
| Settling-in allowance and introduction fee for pilots | 492,115,710.89 | 35,166,735.54 | (34,200,343.56) | (2,537,500.00) | 490,544,602.87 | ||||
| Prepaid discount interest on interest-free loans to employees | 27,580,595.39 | 28,424,137.20 | (8,499,877.44) | (7,093,363.62) | 40,411,491.53 | ||||
| Others | 25,970,965.62 | 944,145.86 | (5,370,003.63) | (3,800,082.92) | 17,745,024.93 | ||||
| 1,714,173,133.47 | 248,127,386.83 | (393,322,855.05) | (24,311,313.90) | 1,544,666,351.35 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(23) Other non-current assets
| 30 June 2020 | 31 December 2019 | ||
| Advances for engineering equipment | 717,654,072.06 | 532,637,819.99 | |
| Prepaid land use rights | 257,201,711.30 | 30,448,790.00 | |
| 974,855,783.36 | 563,086,609.99 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(24) Asset/Credit impairment and provision for losses
| 31 December 2019 | Provision in the current period | Decrease in the current period | 30 June 2020 | ||||||||
| Reversal in the current period | Write-off in the current period | Decrease due to disposal of subsidiaries in the current period | |||||||||
| Provision for bad debts | 163,704,365.44 | 320,753,077.70 | - | (54,687,761.94) | (34,535.35) | 429,735,145.85 | |||||
| Including: Provision for bad debts of accounts receivable (Note 4(4)) | 125,729,570.66 | 205,151,831.67 | - | (45,941,387.72) | (29,280.82) | 284,910,733.79 | |||||
| Provision for bad debts of other receivables (Note 4(8)) | 27,205,716.14 | 114,672,175.85 | - | (8,746,374.22) | (5,254.53) | 133,126,263.24 | |||||
| Provision for bad debts of long-term receivables (Note 4(12)) | 10,769,078.64 | 929,070.18 | - | - | - | 11,698,148.82 | |||||
| Provision for impairment of factoring receivables (Note 4(6)) | 74,519,671.86 | 49,601,393.26 | - | - | - | 124,121,065.12 | |||||
| Provision for impairment of loans and advances (Note 4(7)) | 15,219,113.18 | 89,186,630.95 | - | - | - | 104,405,744.13 | |||||
| Sub-total | 253,443,150.48 | 459,541,101.91 | - | (54,687,761.94) | (34,535.35) | 658,261,955.10 | |||||
| Provision for impairment of long-term equity investments (Note 4(13)) | 160,223,258.80 | 3,869,728.47 | - | - | - | 164,092,987.27 | |||||
| Provision for impairment of intangible assets (Note 4(19)) | 30,113,509.80 | 23,599,356.05 | - | - | - | 53,712,865.85 | |||||
| Provision for impairment of goodwill (Note 4(21)) | 2,434,509.81 | - | - | - | - | 2,434,509.81 | |||||
| Sub-total | 192,771,278.41 | 27,469,084.52 | - | - | - | 220,240,362.93 | |||||
| 446,214,428.89 | 487,010,186.43 | - | (54,687,761.94) | (34,535.35) | 878,502,318.03 | ||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(25) Short-term borrowings
| 30 June 2020 | 31 December 2019 | ||
| Unsecured borrowings | 6,386,681,782.54 | 5,807,413,760.65 | |
| Guaranteed borrowings (a) | 20,024,166.66 | 135,486,216.75 | |
| Rediscounted notes (b) | 105,271,155.80 | 110,474,665.10 | |
| Re-factoring | 35,015,984.05 | - | |
| 6,546,993,089.05 | 6,053,374,642.50 |
(a) As at 30 June 2020, guaranteed borrowings of RMB 20,024,166.66 (31 December 2019: RMB
135,486,216.75) were guaranteed by subsidiaries within the Group.
(b) As at 30 June 2020, the amount of unmatured notes held by the Group that are rediscounted by the
PBOC was RMB 105,271,155.80 (31 December 2019: RMB 110,474,665.10 with a rediscountedinterest rate of 2.25% (31 December 2019: 2.25%).
(c) As at 30 June 2020, the range of annual interest rate of short-term borrowings was 1.14% to 4.35%
(31 December 2019: 3.17% to 5.00%).
(26) Accounts payable
| 30 June 2020 | 31 December 2019 | ||
| Payables to related parties (Note 8(4)(g)) | 276,831,940.94 | 235,963,975.43 | |
| Outsourcing cost payable | 7,574,635,695.75 | 7,389,860,646.60 | |
| Transportation cost payable | 1,840,475,588.38 | 1,806,769,493.30 | |
| Supply and material expenses payable | 1,075,521,133.82 | 1,239,591,306.99 | |
| Office and rental fees payable | 936,095,411.82 | 864,876,400.59 | |
| Customs cost payable | 22,753,314.35 | 30,614,446.33 | |
| Others | 458,824,206.95 | 420,579,741.10 | |
| 12,185,137,292.01 | 11,988,256,010.34 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(26) Accounts payable (Cont’d)
Accounts payable with ageing over 1 year are analysed as follows:
| 30 June 2020 | 31 December 2019 | Main reason for unsettlement | |||
| Supply and material expenses payable | 53,642,552.73 | 8,255,987.64 | No invoice issued by supplier | ||
| Office and rental fees payable | 15,964,598.33 | 15,360,331.60 | No invoice issued by supplier | ||
| Outsourcing cost payable | 11,108,213.63 | 13,790,520.88 | No invoice issued by supplier | ||
| Transportation cost payable | 4,855,929.09 | 3,125,442.73 | No invoice issued by supplier | ||
| Others | 18,882,449.11 | 19,775,522.07 | |||
| 104,453,742.89 | 60,307,804.92 |
(27) Advances from customers
| 30 June 2020 | 31 December 2019 | ||
| Advances from related parties (Note 8(4)(h)) | 859,774.94 | 33,825,257.10 | |
| Advances of freight charges and others | - | 613,794,082.83 | |
| Advances of rental and others | 15,992,144.43 | 22,329,590.79 | |
| 16,851,919.37 | 669,948,930.72 |
As at 30 June 2020, the Group had no advances from customers with ageing over 1 year (31December 2019: Nil).
(28) Contract liabilities
| 30 June 2020 | 31 December 2019 | ||
| Advances from related parties (Note 8(4)(i)) | 18,017,012.18 | -- | |
| Advances of freight charges and others | 1,099,370,085.72 | -- | |
| 1,117,387,097.90 | -- |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(29) Employee benefits payable
| 30 June 2020 | 31 December 2019 | ||
| Short-term employee benefits payable (a) | 3,669,453,726.27 | 3,251,514,851.48 | |
| Defined contribution plans payable (b) | 28,838,192.22 | 29,547,658.55 | |
| 3,698,291,918.49 | 3,281,062,510.03 |
(a) Short-term employee benefits payable
| 31 December 2019 | Increase in the current period | Decrease in the current period | 30 June 2020 | ||||
| Wages and salaries, bonus, allowances and subsidies | 2,876,056,562.67 | 11,171,928,599.91 | (10,792,903,627.41) | 3,255,081,535.17 | |||
| Employee welfare | 7,584,222.03 | 293,520,737.54 | (290,717,134.47) | 10,387,825.10 | |||
| Social security contributions | 9,894,134.53 | 177,911,972.41 | (174,985,028.71) | 12,821,078.23 | |||
| Including: Medical insurance | 8,617,050.36 | 150,271,622.96 | (147,193,822.24) | 11,694,851.08 | |||
| Work injury insurance | 66,242.02 | 16,711,189.71 | (16,318,050.02) | 459,381.71 | |||
| Maternity insurance | 1,210,842.15 | 10,929,159.74 | (11,473,156.45) | 666,845.44 | |||
| Housing funds | 11,030,177.99 | 135,485,026.53 | (133,786,789.76) | 12,728,414.76 | |||
| Labour union funds and employee education funds | 302,729,297.48 | 111,949,652.00 | (75,611,202.13) | 339,067,747.35 | |||
| Non-monetary welfare | 17,537,841.99 | 451,626,965.89 | (454,565,131.52) | 14,599,676.36 | |||
| Others | 26,682,614.79 | 157,708,037.58 | (159,623,203.07) | 24,767,449.30 | |||
| 3,251,514,851.48 | 12,500,130,991.86 | (12,082,192,117.07) | 3,669,453,726.27 |
Non-monetary welfare provided by the Group for employees primarily were non-monetary subsidiesin various forms which were measured at fair value.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(29) Employee benefits payable (Cont’d)
(b) Defined contribution plans
| 31 December 2019 | Increase in the current period | Decrease in the current period | 30 June 2020 | ||||
| Basic pension insurance | 28,370,990.71 | 216,974,678.62 | (217,755,410.19) | 27,590,259.14 | |||
| Unemployment insurance | 1,176,667.84 | 6,406,630.29 | (6,335,365.05) | 1,247,933.08 | |||
| 29,547,658.55 | 223,381,308.91 | (224,090,775.24) | 28,838,192.22 |
(30) Taxes payable
| 30 June 2020 | 31 December 2019 | ||
| Enterprise income tax payable | 804,371,879.37 | 681,286,022.05 | |
| Unpaid VAT | 512,752,078.64 | 317,323,139.66 | |
| Individual income tax payable | 55,050,817.61 | 98,726,851.56 | |
| City maintenance and construction tax payable | 16,926,887.02 | 13,065,277.94 | |
| Educational surcharge payable | 12,675,258.04 | 9,980,350.61 | |
| Others | 22,771,867.36 | 18,762,363.84 | |
| 1,424,548,788.04 | 1,139,144,005.66 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(31) Other payables
| 30 June 2020 | 31 December 2019 | ||
| Current accounts payable to related parties (Note 8(4)(j)) | 32,369,675.86 | 30,142,576.37 | |
| Engineering equipment payable | 2,244,737,011.39 | 1,955,006,954.01 | |
| Payables of cash on delivery service | 1,392,006,721.00 | 1,395,911,162.92 | |
| Deposits payable | 678,793,269.28 | 553,202,067.88 | |
| Management fees payable | 147,177,237.83 | 93,317,776.80 | |
| Warranty deposits payable | 140,641,030.06 | 138,508,695.73 | |
| Temporary collection payable | 67,096,704.19 | 76,437,292.85 | |
| Investments payable | 26,710,805.23 | 26,710,805.23 | |
| Professional service fee payable | 7,206,299.89 | 5,472,382.85 | |
| Restricted share repurchases payable | - | 59,252,503.45 | |
| Others | 698,045,631.42 | 373,197,612.53 | |
| 5,434,784,386.15 | 4,707,159,830.62 |
Other payables with ageing over 1 year:
| 30 June 2020 | 31 December 2019 | Main reason for unsettlement | |||
| Deposits payable | 278,500,632.87 | 287,706,582.64 | Continuing business not expired | ||
| Engineering equipment payable | 62,060,416.56 | 116,856,305.32 | Project payment unsettled | ||
| Warranty deposits payable | 31,351,869.49 | 28,617,237.83 | Warranty in effect | ||
| Indemnities from insurance company claims on hold and others | |||||
| Others | 30,994,240.87 | 16,264,052.12 | |||
| 402,907,159.79 | 449,444,177.91 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(32) Current portion of non-current liabilities
| 30 June 2020 | 31 December 2019 | ||
| Current portion of long-term borrowings (Note 4(34)) | 868,978,660.42 | 743,765,598.22 | |
| Current portion of employee incentives (Note 4(37)) | 50,000,000.00 | 40,000,000.00 | |
| Current portion of debentures payable (a) | 1,236,763,643.90 | 1,209,959,164.92 | |
| Interest of current portion of debentures payable (Note 4 (35)) | 194,655,951.56 | 94,484,104.84 | |
| Current portion of long-term payables (Note 4(36)) | - | 3,683,423.76 | |
| 2,350,398,255.88 | 2,091,892,291.74 |
(a) Current portion of debentures payable
| 31 December 2019 | Interest accrual | Amortisation of premium/discount | Repayment for the current period | 30 June 2020 | ||||
| The First Debentures of 2017 (Note 4(35)) | 534,903,660.11 | 17,269,166.77 | 110,846.28 | (4,903,660.11) | 547,380,013.05 | |||
| The Second Debentures of 2018 (Note 4(35)) | 675,055,504.81 | 19,246,866.67 | 136,764.18 | (5,055,504.81) | 689,383,630.85 | |||
| 1,209,959,164.92 | 36,516,033.44 | 247,610.46 | (9,959,164.92) | 1,236,763,643.90 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(33) Other current liabilities
| 30 June 2020 | 31 December 2019 | ||
| Super&short term commercial paper (a): | |||
| The First Phase of 2019 | - | 511,760,777.99 | |
| The Third Phase of 2019 | - | 505,686,080.51 | |
| The First Phase of 2020 | 504,367,302.74 | - | |
| The Second Phase of 2020 | 503,277,177.12 | - | |
| The Third Phase of 2020 | 502,071,550.85 | - | |
| The Fourth Phase of 2020 | 501,228,833.88 | - | |
| Convertible corporate debentures of Shenzhen S.F. Express Co., Ltd. ("Convertible Corporate Debentures of S.F. Express ") (b) | 2,037,639,760.16 | - | |
| 4,048,584,624.75 | 1,017,446,858.50 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(33) Other current liabilities (Cont’d)
(a) Super&short term commercial paperis detailed as follows:
| Par value (RMB) | Date of issue | Term | Interest rate | ||||
| The First Phase of 2019 | 500,000,000.00 | 10 April 2019 | 270 days | 3.20% | |||
| The Third Phase of 2019 | 500,000,000.00 | 23 August 2019 | 270 days | 3.30% | |||
| The First Phase of 2020 | 500,000,000.00 | 21 February 2020 | 270 days | 2.50% | |||
| The Second Phase of 2020 | 500,000,000.00 | 13 March 2020 | 270 days | 2.20% | |||
| The Third Phase of 2020 | 500,000,000.00 | 15 April 2020 | 180 days | 2.04% | |||
| The Fourth Phase of 2020 | 500,000,000.00 | 8 May 2020 | 90 days | 1.70% |
(b) On 28 February 2020, Shenzhen S.F. Express Co., Ltd. (“S.F. Express”), a subsidiary of the
Company, entered into an convertible corporate debentures agreement with investors. Pursuant tothe agreement, the investors will subscribe the Convertible Corporate Debentures of S.F. Expresswith a total consideration of USD300,000,000.00 or equivalent in RMB according to the terms andconditions of the agreement. Such debentures are interest free and have a term of 1 year. Subject tothe conditions agreed upon, the Convertible Corporate Debentures of S.F. Express will be convertedinto 150 million ordinary shares newly issued by S.F. Express with a par value of RMB 1 per share ata price of USD 2 per share or equivalent in RMB. The settlement date of the Convertible CorporateDebentures of S.F. Express is 25 March 2020, and any amount denominated in USD involved in theagreement will be converted into RMB at the mid-price of RMB against USD as announced by thePeople's Bank of China two working days prior to the settlement date.
The Convertible Corporate Debentures of S.F. Express are listed as follows:
| Liability portion | Minority interests portion | Total | |||
| Amount of Convertible Corporate Debentures issued | 2,033,010,982.68 | 59,719,017.32 | 2,092,730,000.00 | ||
| Direct issuance expenses | (6,883,003.91) | (202,096.09) | (7,085,100.00) | ||
| Balance at the date of issue | 2,026,127,978.77 | 59,516,921.23 | 2,085,644,900.00 | ||
| Amortisation in the current period | 11,511,781.39 | - | 11,511,781.39 | ||
| Balance as at 30 June 2020 | 2,037,639,760.16 | 59,516,921.23 | 2,097,156,681.39 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(34) Long-term borrowings
| 30 June 2020 | 31 December 2019 | ||
| Unsecured borrowings | 1,644,366,446.42 | 1,775,899,754.43 | |
| Guaranteed borrowings (a) | 225,000,000.00 | 4,802,429,633.76 | |
| Secured borrowings (b) | 617,671,422.49 | 704,992,994.44 | |
| 2,487,037,868.91 | 7,283,322,382.63 | ||
| Less: Current portion of long-term borrowings (Note 4(32)) | |||
| Unsecured borrowings | (692,815,147.07) | (571,699,370.26) | |
| Guaranteed borrowings | (105,000,000.00) | (110,367,331.68) | |
| Secured borrowings | (71,163,513.35) | (61,698,896.28) | |
| (868,978,660.42) | (743,765,598.22) | ||
| 1,618,059,208.49 | 6,539,556,784.41 |
(a) As at 30 June 2020, the Group’s guaranteed borrowings of RMB 160,000,000.00 (31 December
2019: RMB 4,727,304,787.70) were guaranteed by subsidiaries within the Group and guaranteedborrowings of RMB 65,000,000.00 (31 December 2019: RMB 70,000,000.00) were guaranteed byTaisen Holdings and Havi Group LP (U.S.).
(b) As at 30 June 2020, the secured bank borrowings of RMB 123,270,000.00 (31 December 2019:
RMB 123,270,000.00) were secured by construction in progress with carrying amount of RMB157,683,272.03 (31 December 2019: RMB 171,224,485.06), fixed assets with carrying amount ofRMB 8,597,702.27 (31 December 2019: RMB 52,082,818.28), investment properties with carryingamount of RMB 64,375,031.67 (31 December 2019: RMB 83,440,831.58) and intangible assets withcarrying amount of RMB 73,200,239.84 (31 December 2019: RMB 10,716,573.85) respectively andwere fully guaranteed by Taisen Holdings. The interest is paid quarterly. The principal should berepaid during the period from 19 October 2020 to 20 October 2033 by instalments.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(34) Long-term borrowings (Cont’d)
(b) (Cont'd)
As at 30 June 2020, the secured bank borrowings of RMB 424,474,537.18 (31 December 2019:
RMB 433,317,756.72) were secured by the Group’s intangible assets with carrying amount of RMB1,193,433,073.67 (31 December 2019: RMB 1,210,441,621.04). The interest is paid quarterly. Theprincipal should be repaid during the period from 18 November 2019 to 18 November 2026 byinstalments.
As at 30 June 2020, the secured bank borrowings of RMB 69,136,250.00 (31 December 2019: RMB70,661,000.00) were secured by the Group’s fixed assets with carrying amount of RMB62,890,294.18 (31 December 2019: RMB 45,763,274.70), intangible assets with carrying amount ofRMB 568,653.46 (31 December 2019: RMB 9,400,960.02) and investment properties with carryingamount of RMB 138,964,459.29 (31 December 2019: RMB 149,388,798.88) respectively and werefully guaranteed by Taisen Holdings. The interest is paid quarterly. The principal should be repaidduring the period from 18 January 2020 to 18 January 2034 by instalments.
In addition, as at 31 December 2019, the secured bank borrowings of RMB 76,800,000.00 weresecured by the Group’s intangible assets with carrying amount of RMB 18,990,102.62, fixed assetswith carrying amount of RMB 151,669,732.02 and investment properties with carrying amount ofRMB 27,374,741.45 and were fully guaranteed by Taisen Holdings. The borrowings were repaid inadvance on 5 June 2020.
(c) As at 30 June 2020, the rate of long-term borrowings ranged from 4.18% to 5.39% (31 December
2019: 3.33% to 5.39%).
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(35) Debentures payable
| 31 December 2019 | Issued in the current period | Issuance expenses | Interest accrual | Amortisation of premium/ discount | Foreign exchange gains or losses and exchange differences on translation of foreign currency financial statements | Conversion amount in the current period | Current portion of interest payable | 30 June 2020 | |||||||||||
| Payment in cash | |||||||||||||||||||
| The First Debentures of 2018 | 799,478,889.93 | - | - | 31,364,666.67 | 159,904.08 | - | - | - | (31,364,666.67) | 799,638,794.01 | |||||||||
| Overseas debentures denominated in USD | 3,467,514,126.93 | - | - | 62,820,417.49 | 3,401,522.62 | 46,820,311.22 | - | - | (62,820,417.49) | 3,517,735,960.77 | |||||||||
| The First Middle-term Notes of 2018 | 999,309,244.49 | - | - | 34,936,666.74 | 83,280.06 | - | - | - | (34,936,666.74) | 999,392,524.55 | |||||||||
| The First Debentures of 2019 | 299,713,387.03 | - | - | 8,640,750.00 | 50,590.74 | - | - | - | (8,640,750.00) | 299,763,977.77 | |||||||||
| Convertible corporate debentures | 5,031,969,368.14 | - | - | 7,077,523.44 | 93,763,882.32 | - | (1,286,741,934.34) | (24,748.57) | (5,356,700.56) | 3,840,687,390.43 | |||||||||
| Overseas debentures denominated in USD of 2020 | - | 4,903,115,000.00 | (74,204,391.98) | 51,536,750.10 | 2,363,372.76 | 52,029,293.88 | - | - | (51,536,750.10) | 4,883,303,274.66 | |||||||||
| 10,597,985,016.52 | 4,903,115,000.00 | (74,204,391.98) | 196,376,774.44 | 99,822,552.58 | 98,849,605.10 | (1,286,741,934.34) | (24,748.57) | (194,655,951.56) | 14,340,521,922.19 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(35) Debentures payable (Cont’d)
| Currency | Par value | Date of issue | Term | Amount (equivalent to RMB) | |||||
| The First Debentures of 2017 (Note 4(32(a)) (a) | RMB | 530,000,000.00 | 17 October 2017 | 3+2 years | 530,000,000.00 | ||||
| The First Debentures of 2018 (a) | RMB | 800,000,000.00 | From 1 August 2018 2 August 2018 | 3 years | 800,000,000.00 | ||||
| The Second Debentures of 2018 (Note 4(32(a)) (a) | RMB | 670,000,000.00 | From 22 October 2018 to 23 October 2018 | 2+1 years | 670,000,000.00 | ||||
| Overseas debentures denominated in USD (b) | USD | 500,000,000.00 | 27 July 2018 | 5 years | 3,407,508,933.00 | ||||
| The First Middle-term Notes of 2018 (c) | RMB | 1,000,000,000.00 | 19 September 2018 | 3 years | 1,000,000,000.00 | ||||
| The First Debentures of 2019 (a) | RMB | 300,000,000.00 | 20 September 2019 | 3 years | 300,000,000.00 | ||||
| Convertible corporate debentures (d) | RMB | 5,800,000,000.00 | 18 November 2019 | 6 years | 5,800,000,000.00 | ||||
| Overseas debentures denominated in USD of 2020 (e) | USD | 700,000,000.00 | 20 February 2020 | 10 years | 4,903,115,000.00 |
(a) Taisen Holdings was approved to issue corporate debentures of no more than RMB 2 billion
(inclusive) in instalments to the public under the Regulatory Permission [2017] No. 1015 as issuedby the China Securities Regulatory Commission. In 2017, Taisen Holdings publicly issued thecorporate debentures (1st instalment) (“the First Debentures of 2017”) to qualified investors. Thedebenture interest shall be annually calculated at simple interest rate, and the nominal interest rateis 4.6%, with interest paid annually and the final instalment of interest paid with the principal. Thedebenture has the put options for investors, and investors are entitled to the right to choose to put allor part of the debenture held by them at par value to Taisen Holdings on the interest payment datewhich is expected in October 2020 for the third year since issued such debenture. Accordingly, therelative debentures are classified into current portion of non-current liabilities.
In 2018, Taisen Holdings publicly issued the corporate debentures (1st instalment) (“the FirstDebentures of 2018”) to qualified investors. The debenture interest shall be annually calculated atsimple interest rate, and the nominal interest rate is 4.29%, with interest paid annually and the finalinstalment of interest paid with the principal.
In 2018, Taisen Holdings publicly issued the corporate debentures (2nd instalment) (“the SecondDebentures of 2018”) to qualified investors. The debenture interest shall be annually calculated atsimple interest rate, and the nominal interest rate is 4.17%, with interest paid annually and the finalinstalment of interest paid with the principal. The debenture has the put options for investors, andinvestors are entitled to the right to choose to put all or part of the debenture held by them at parvalue to Taisen Holdings on the interest payment date which is expected in October 2020 for thesecond year since issued such debenture. Accordingly, the relative debentures are classified intocurrent portion of non-current liabilities.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(35) Debentures payable (Cont’d)
(a) Taisen Holdings was approved to issue corporate debentures of no more than RMB 2 billion
(inclusive) in instalments to the public under the Regulatory Permission [2019] No. 388 as issued bythe China Securities Regulatory Commission. In 2019, Taisen Holdings publicly issued thecorporate debentures (1st instalment) (“the First Debentures of 2019”) to qualified investors. Thedebenture interest shall be annually calculated at simple interest rate, and the nominal interest rateis 3.69%, with interest paid annually and the final instalment of interest paid with the principal.
(b) On 26 July 2018, S.F. Holding Investment Limited, a wholly-owned overseas subsidiary of the
Company, issued debentures of USD 500 million overseas. The debentures were listed on the StockExchange of Hong Kong Limited on 27 July 2018. The nominal interest rate is 4.13% per annum,and the interest is paid semi-annually, for which the Company provides unconditional andirrevocable cross-border guarantee.
(c) According to the Notice of Acceptance of Registration issued by the National Association of
Financial Market Institutional Dealers (Zhong Shi Zhu Xie [2017] MTN443), Taisen Holdings’ quotaof middle-term notes was RMB 2 billion. On 19 September 2018, Taisen Holdings issued the firstmiddle-term notes of 2018 (“the First Middle-term Notes of 2018”) totalling RMB 1 billion at anominal interest rate of 4.46%, with interest paid annually and the final instalment of interest paidwith the principal.
(d) The Company publicly issued convertible corporate debentures (“Convertible Corporate
Debentures”) totalling RMB 5.8 billion on 18 November 2019 under the Regulatory Permission[2019] No. 1903 as issued by the China Securities Regulatory Commission. The ConvertibleCorporate Debentures have a term of six years, that is, from 18 November 2019 to 18 November2025, with a nominal interest rate of 0.20% for the first year, and thereafter it will be graduallyincreased to 2.00% over the remaining years. Holders of the Convertible Corporate Debentures canexercise the right to convert the Convertible Corporate Debentures into shares of the Company atthe current conversion price during the period from the first trading day after six months following theend of the issuance of Convertible Corporate Debentures to the maturity date (the “ConversionPeriod”), from 22 May 2020 to 18 November 2025. Within five trading days after the expiration of theConversion Period, the Company will redeem all the Convertible Corporate Debentures that havenot been converted at 106% of the par value of such Convertible Corporate Debentures (includingthe final instalment of interest).
During the Conversion Period, if the closing price of the Company’s shares is not less than 130%(inclusive) of the current conversion price for at least 15 out of 30 consecutive trading days, theCompany shall have the right to redeem all or part of the outstanding Convertible CorporateDebentures at par value of the Convertible Corporate Debentures plus the current accrued interest.
In addition, the Company shall have the right to redeem all or part of the outstanding ConvertibleCorporate Debentures at par value of the debentures plus the current accrued interest if the balanceof the outstanding Convertible Corporate Debentures is less than RMB 30 million.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(35) Debentures payable (Cont’d)
(d) Such Convertible Corporate Debentures were issued at the initial conversion price of RMB 40.41
per share, which was not less than the average trading price of the Company’s stocks in the firsttwenty trading days before the announcement date of the prospectus (the average trading price onthe trading day before adjustment shall be adjusted accordingly in case of stock price adjustmentarising from ex-right and ex-dividend within such twenty trading days), and the average trading priceon the previous trading day. After the issuance, the Company will adjust the conversion priceaccordingly in the event of bonus shares distribution, transfer to share capital, issuance of newshares (excluding share capital increased due to issuance of Convertible Corporate Debentures intoshares), allotment of shares and distribution of cash dividends. During the duration of theConvertible Corporate Debentures issued, where the closing price of the Company’s shares is lowerthan 80% of the current conversion price in at least 15 of 30 consecutive trading days, the Board ofDirectors of the Company shall have the right to propose a plan for conversion price reduction andsubmit it to the shareholders’ meeting of the Company for deliberation and voting.
The Company implemented the annual equity distribution scheme of 2019 on 24 April 2020.Pursuant to issuance provisions stipulated in the Prospectus for the Public Issuance of ConvertibleCorporate Debentures of S.F. Holding Co., Ltd. and relevant regulations of China SecuritiesRegulatory Commission on issuance of convertible corporate debentures, the conversion price ofConvertible Corporate Debentures was adjusted from RMB 40.41 per share to RMB 40.14 per sharesince 24 April 2020. In June 2020, the Company completed the repurchase and cancellationprocedures for restricted shares at China Securities Depository and the Clearing CorporationLimited Shenzhen Branch. The total share capital of the Company decreased by 2,182,222 sharesfrom 4,422,030,407 shares to 4,419,848,185 shares. Pursuant to issuance provisions stipulated inthe Prospectus for the Public Issuance of Convertible Corporate Debentures of S.F. Holding Co.,Ltd. and relevant regulations of China Securities Regulatory Commission on issuance of convertiblecorporate cebentures, the conversion price of Convertible Corporate Debentures was adjusted fromRMB 40.14 per share to RMB 40.15 per share since 19 June 2020.
For the six months ended 30 June 2020, convertible corporate debentures with carrying amount ofRMB 1,479,651,803.09 (for the six months ended 30 June 2019: Nil) were converted into36,244,799 A-share ordinary shares (for the six months ended 30 June 2019: Nil) upon the exerciseof conversion rights. The share capital was increased by RMB 36,244,799.00 and the capitalreserve by RMB 1,443,407,004.09.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(35) Debentures payable (Cont’d)
(d) Convertible Corporate Debentures are listed as follows:
| Liability portion | Equity portion | Total | |||
| Amount of Convertible Corporate Debentures issued | 5,028,196,096.65 | 771,803,903.35 | 5,800,000,000.00 | ||
| Direct issuance expenses | (18,667,806.36) | (2,865,418.45) | (21,533,224.81) | ||
| Balance on the date of issue | 5,009,528,290.29 | 768,938,484.90 | 5,778,466,775.19 | ||
| Accumulated amortisation at the beginning of the period | 22,441,077.85 | - | 22,441,077.85 | ||
| Balance at 1 January 2020 | 5,031,969,368.14 | 768,938,484.90 | 5,800,907,853.04 | ||
| Amortisation in the current period | 93,763,882.32 | - | 93,763,882.32 | ||
| Interest expenses accrued for the current period | 7,077,523.44 | - | 7,077,523.44 | ||
| Conversion amount in the current period | (1,286,741,934.34) | (192,909,868.75) | (1,479,651,803.09) | ||
| Payment in cash | (24,748.57) | (3,711.90) | (28,460.47) | ||
| Less: Current portion of interest payable | (5,356,700.56) | - | (5,356,700.56) | ||
| Balance at 30 June 2020 | 3,840,687,390.43 | 576,024,904.25 | 4,416,712,294.68 |
(e) On 20 February 2020, S.F. Holding Investment Limited, a wholly-owned overseas subsidiary of the
Company, completed the issuance of USD 700 million debentures. The debentures were listed onthe Stock Exchange of Hong Kong Limited on 21 February 2020. The nominal interest rate is 2.875%per annum, the interest is paid semi-annually and guaranteed by the Company.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(36) Long-term payables
| 30 June 2020 | 31 December 2019 | ||
| Long-term advances payable | 46,385,616.32 | 45,895,615.85 | |
| Long-term payables to China Development Fund Co., Ltd. | - | 20,362,534.49 | |
| Others | 10,116,387.59 | 15,735,603.19 | |
| Less: Current portion of long-term payables | |||
| (Note 4(32)) | - | (3,683,423.76) | |
| 56,502,003.91 | 78,310,329.77 |
(37) Long-term employee benefits payable
| 30 June 2020 | 31 December 2019 | ||
| Employee incentives | 148,366,731.13 | 158,434,634.21 | |
| Less: Current portion of employee incentives | |||
| (Note 4(32)) | (50,000,000.00) | (40,000,000.00) | |
| Cash-settled share-based payment | 92,039,716.62 | 69,392,342.16 | |
| Long-term service bonus | 20,299,939.58 | 16,639,470.36 | |
| 210,706,387.33 | 204,466,446.73 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
- 205 -
4 Notes to the consolidated financial statements (Cont’d)
(38) Deferred income
| 31 December 2019 | Increase in the current period | Decrease in the current period | 30 June 2020 | Source | ||||
| Received government grants | ||||||||
| Government grants (a) | 201,496,411.81 | 10,816,849.39 | (16,973,417.75) | 195,339,843.45 | Pending for future recognition in income |
(a) The government grants related to deferred income in the current period are presented as follows:
| Government grants | 31 December 2019 | Increase in grants in the current period | Amount recognised in other income in the current period (Note 4(55)) | 30 June 2020 | Related to assets/income | |||
| Construction development fund for Tianjin Project | 41,742,674.75 | - | (206,165.64) | 41,536,509.11 | Related to assets | |||
| Ancillary grant of infrastructure for Wuhu E-Commerce Industrial Park | 25,869,122.25 | - | (280,625.88) | 25,588,496.37 | Related to assets | |||
| Comprehensive pilot program of Shanghai modern service industry | 25,927,848.88 | - | (504,792.48) | 25,423,056.40 | Related to assets | |||
| Weihai industrial development support fund | 16,389,000.00 | - | - | 16,389,000.00 | Related to assets | |||
| Yancheng Smart E-Commerce Logistics Park Project | 14,959,794.08 | - | (162,019.44) | 14,797,774.64 | Related to assets | |||
| Grant for maintenance of aircraft engines | 9,502,005.06 | 4,703,766.00 | (1,756,132.71) | 12,449,638.35 | Related to assets | |||
| Ma’anshan Industrial Park Project | 11,441,226.58 | - | (117,546.84) | 11,323,679.74 | Related to assets | |||
| Subsidy for new energy vehicles | 6,306,194.54 | 4,222,500.00 | (561,841.70) | 9,966,852.84 | Related to assets | |||
| Enterprise Expansion Fund | 8,799,344.09 | 1,000,000.00 | (1,362,149.38) | 8,437,194.71 | Related to assets | |||
| Shenzhen intelligent logistics project fund | 4,488,888.88 | - | (833,333.34) | 3,655,555.54 | Related to assets | |||
| Special fund of Shenzhen industrial design development | 2,789,473.68 | - | (10,000.02) | 2,779,473.66 | Related to assets | |||
| Commercial circulation development project | 2,531,991.51 | - | (264,021.22) | 2,267,970.29 | Related to assets | |||
| Tianjin Port Free Trade Zone supply chain system construction project | 2,751,248.24 | - | (521,341.14) | 2,229,907.10 | Related to assets | |||
| Compensation for land acquisition of Nanning Distribution Hub | 2,603,441.31 | - | (538,707.15) | 2,064,734.16 | Related to assets | |||
| Special subsidy for logistics standardisation granted by the Bureau of Commerce | 2,543,361.74 | - | (1,474,314.86) | 1,069,046.88 | Related to assets | |||
| Others | 22,850,796.22 | 890,583.39 | (8,380,425.95) | 15,360,953.66 | Related to assets | |||
| 201,496,411.81 | 10,816,849.39 | (16,973,417.75) | 195,339,843.45 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(39) Deferred tax assets and deferred tax liabilities
(a) Deferred tax assets not taking into consideration the offsetting of balances
| 30 June 2020 | 31 December 2019 | ||||||
| Deductible temporary differences and deductible tax losses | Deferred tax assets | Deductible temporary differences and deductible tax losses | Deferred tax assets | ||||
| Deductible losses | 2,514,974,320.71 | 611,538,313.55 | 3,024,282,948.11 | 733,828,350.94 | |||
| Accrued expenses | 835,289,216.81 | 192,245,661.57 | 775,827,657.83 | 184,724,565.33 | |||
| Unrealised profits from internal transactions | 525,485,927.73 | 131,371,481.93 | 466,329,274.44 | 116,582,318.61 | |||
| Employee incentives | 108,365,294.72 | 27,074,669.59 | 118,166,438.48 | 29,541,609.62 | |||
| Provision for asset impairment | 389,423,999.26 | 90,405,466.88 | 251,281,539.04 | 61,105,136.91 | |||
| Deferred income | 180,947,347.12 | 43,252,140.07 | 183,305,261.85 | 44,134,413.21 | |||
| Depreciation and amortisation differences | 442,028,117.64 | 94,238,554.26 | 482,238,954.05 | 101,302,957.45 | |||
| 4,996,514,223.99 | 1,190,126,287.85 | 5,301,432,073.80 | 1,271,219,352.07 | ||||
| Including: | |||||||
| Expected to be recovered within 1 year (inclusive) | |||||||
| 318,146,060.92 | 294,225,505.65 | ||||||
| Expected to be recovered after 1 year | 871,980,226.93 | 976,993,846.42 | |||||
| 1,190,126,287.85 | 1,271,219,352.07 | ||||||
(b) Deductible tax losses and deductible temporary differences that are not recognised as deferred tax
assets are analysed as follows:
| 30 June 2020 | 31 December 2019 | ||
| Deductible tax losses (c) | 4,666,848,459.21 | 3,224,474,481.50 | |
| Deductible temporary differences | 277,121,892.74 | 28,468,543.55 | |
| 4,943,970,351.95 | 3,252,943,025.05 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(39) Deferred tax assets and deferred tax liabilities (Cont’d)
(c) The following table shows unrecognised deductible tax losses based on its expiration date:
| 30 June 2020 | 31 December 2019 | ||
| 2020 | 186,516,718.72 | 235,896,007.94 | |
| 2021 | 259,775,241.10 | 307,466,976.93 | |
| 2022 | 262,866,244.69 | 284,043,639.97 | |
| 2023 | 613,863,363.01 | 626,565,480.16 | |
| 2024 | 1,181,152,960.84 | 1,116,618,889.70 | |
| 2025 and subsequent years | 2,162,673,930.85 | 653,883,486.80 | |
| 4,666,848,459.21 | 3,224,474,481.50 |
(d) Deferred tax liabilities before offsetting
| 30 June 2020 | 31 December 2019 | ||||||
| Taxable temporary differences | Deferred tax liabilities | Taxable temporary differences | Deferred tax liabilities | ||||
| Changes in fair value of investments in other equity instruments | 735,070,328.52 | 185,961,943.33 | 744,088,970.00 | 186,022,242.50 | |||
| Changes in fair value of other non-current financial assets | 9,424,488.44 | 2,356,122.11 | 9,424,488.44 | 2,356,122.11 | |||
| Changes in fair value upon reclassification of remaining equity of Hive Box Technology | 446,796,225.96 | 111,699,056.49 | 446,796,225.96 | 111,699,056.49 | |||
| Changes in fair value upon reclassification of remaining equity of Shenzhen Fengyi Technology Co., Ltd. ("Fengyi Technology") | 28,000,000.00 | 7,000,000.00 | 28,000,000.00 | 7,000,000.00 | |||
| Depreciation of fixed assets | 3,259,236,640.54 | 755,279,725.86 | 2,713,479,796.13 | 594,029,414.30 | |||
| Appreciation in asset value arising from business combination involving enterprises not under common control | 2,887,007,536.98 | ||||||
| 678,176,382.81 | 2,905,562,109.35 | 682,576,336.29 | |||||
| Changes in fair value of financial assets held for trading | 11,569,553.64 | 2,892,388.41 | 9,852,581.08 | 2,463,145.27 | |||
| Others | 166,519,635.94 | 41,629,908.99 | 26,772,768.32 | 6,693,192.08 | |||
| 7,543,624,410.02 | 1,784,995,528.00 | 6,883,976,939.28 | 1,592,839,509.04 | ||||
| Including: | |||||||
| Expected to be recovered within 1 year (inclusive) | 247,497,229.03 | 214,142,463.75 | |||||
| Expected to be recovered after 1 year | 1,537,498,298.97 | 1,378,697,045.29 | |||||
| 1,784,995,528.00 | 1,592,839,509.04 | ||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(39) Deferred tax assets and deferred tax liabilities (Cont’d)
(e) The net balances of deferred tax assets and liabilities after offsetting are as follows:
| 30 June 2020 | 31 December 2019 | ||
| Deferred tax assets - net | 1,004,974,716.39 | 1,066,079,111.56 | |
| Deferred tax liabilities - net | 1,599,843,956.54 | 1,387,699,268.53 |
(40) Share capital
| 31 December 2019 | Increase in the current period (Note 4(35)(d)) | Decrease in the current period (Note 9(1)) | 30 June 2020 | ||||
| Ordinary shares denominated in RMB | 4,414,585,265.00 | 36,244,799.00 | (2,456,568.00) | 4,448,373,496.00 |
| 31 December 2018 | Increase in the current period | Decrease in the current period | 30 June 2019 | ||||
| Ordinary shares denominated in RMB | 4,418,767,258.00 | - | (4,181,993.00) | 4,414,585,265.00 |
(41) Other equity instruments
| 30 June 2020 | 31 December 2019 | ||
| Convertible corporate debentures (Note 4(35)(d)) | 576,024,904.25 | 768,938,484.90 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(42) Capital reserve
| 31 December 2019 | Increase in the current period | Decrease in the current period | 30 June 2020 | ||||
| Share premium | |||||||
| - Capital contribution by shareholders | 15,768,464,376.95 | - | - | 15,768,464,376.95 | |||
| - Business combinations involving enterprises under common control | (76,633,221.35) | - | - | (76,633,221.35) | |||
| - Convertible corporate debentures transferred into share capital and capital reserve (Note 4(35)(d)) | - | 1,443,407,004.09 | - | 1,443,407,004.09 | |||
| - Share-based payment in capital contribution by shareholders (Note 4(43)) | 88,760,253.39 | - | (57,311,814.73) | 31,448,438.66 | |||
| Other capital reserve | |||||||
| - Share-based payment included in capital reserve (Note 9(2)) | |||||||
| 47,011,172.79 | 47,180,411.55 | - | 94,191,584.34 | ||||
| - Others (i) | 296,416,012.38 | 467,034,624.91 | (118,279,760.81) | 645,170,876.48 | |||
| 16,124,018,594.16 | 1,957,622,040.55 | (175,591,575.54) | 17,906,049,059.17 |
| 31 December 2018 | Increase in the current period | Decrease in the current period | 30 June 2019 | ||||
| Share premium | |||||||
| - Capital contribution by shareholders | 15,768,464,376.95 | - | - | 15,768,464,376.95 | |||
| - Business combinations involving enterprises under common control | 73,973,978.65 | - | - | 73,973,978.65 | |||
| - Share-based payment in capital contribution by shareholders | 193,344,979.29 | - | (104,584,725.90) | 88,760,253.39 | |||
| Other capital reserve | |||||||
| - Share-based payment included in capital reserve | |||||||
| 44,965,842.16 | 14,581,133.08 | - | 59,546,975.24 | ||||
| - Others | 138,869,988.62 | 5,959,966.12 | - | 144,829,954.74 | |||
| 16,219,619,165.67 | 20,541,099.20 | (104,584,725.90) | 16,135,575,538.97 |
(i) Movements in the current period represents changes in equity resulting from transactions with
minority shareholders.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(43) Treasury stock
| 31 December 2019 | Increase in the current period | Decrease in the current period | 30 June 2020 | ||||
| Treasury stock | 454,761,306.79 | - | (59,768,382.73) | 394,992,924.06 |
| 31 December 2018 | Increase in the current period | Decrease in the current period | 30 June 2019 | ||||
| Treasury stock | 200,928,467.28 | 394,996,314.03 | (141,663,846.07) | 454,260,935.24 |
As stated in Note 9(2), ordinary A shares, which were issued by the Company to the incentiverecipients of the restricted shares incentive plan in 2017 and 2018, counted at 7,788,643.00 shareswith raised funds totalling RMB 202,255,537.22, including an increment of share capital of RMB7,788,643.00 and an increment of capital reserve of RMB 194,466,894.22. In addition, therepurchasing obligation is recognised in liabilities (as purchase of treasury stock) at the number ofrestricted shares issued multiplied by the repurchasing price.
In 2018, some of the Company’s original incentive recipients resigned and lost their right to receiveincentives, therefore the Company repurchased and cancelled the restricted shares previously heldby these incentive recipients (36,909.00 shares in total) with a deduction from the treasury share ofRMB 1,082,171.88, including a reduction of RMB 36,909.00 in share capital, and RMB 1,045,262.88in capital reserve.
As at 31 December 2018, the Company adjusted the treasury stock by RMB 244,898.06 based onthe revocable cash dividends distributed to holders whose restricted shares were expected to beunlocked in the restricted shares incentive plan for 2017.
As at 3 January 2019, the Company held the 18th session of the fourth Board of Directors, at whichthe Proposal of the Accomplishment of the Unlocking Conditions of the First Post Lock-up Period forthe Restricted Shares for 2017 was reviewed. The Company recognised that the unlockingconditions for the first post lock-up period for the restricted shares for 2017 were met, and thetreasury stock of RMB 32,393,334.30 were deducted. In addition, the criteria of the performanceassessment for the second post lock-up period for the restricted shares incentive plan for 2017 andthe first post lock-up period for the restricted shares incentive plan for 2018 were not met, thereforethe Company repurchased and cancelled the restricted shares previously held by these incentiverecipients (3,741,407.00 shares in total) in 2019 with a deduction from the treasury share of RMB96,583,654.60, including a reduction of RMB 3,741,407.00 in share capital, and RMB 92,842,247.60in capital reserve.
In 2019, some of the Company’s original incentive recipients resigned and lost their right to receiveincentives, therefore the Company repurchased and cancelled the restricted shares previously heldby these incentive recipients (440,586.00 shares in total) with a deduction from the treasury share ofRMB 12,183,064.30, including a reduction of RMB 440,586.00 in share capital, and RMB11,742,478.30 in capital reserve.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(43) Treasury stock (Cont’d)
For the current reporting period, some of the Company’s original incentive recipients resigned andlost their right to receive incentives, therefore the Company repurchased and cancelled therestricted shares previously held by these incentive recipients (274,346 shares in total) with adeduction from the treasury share of RMB 6,674,838.18, including a reduction of RMB 274,346.00in share capital, and RMB 6,400,492.18 in capital reserve.
As at 23 March 2020, at the 3rd session of the 5th Board of Directors, the Proposal of Repurchasingand Cancelling Certain Restricted Shares was approved: the criteria of the performanceassessment for the second post lock-up period for the restricted shares incentive plan for 2018 werenot met, therefore the Company repurchased and cancelled the restricted shares previously held bythese incentive recipients (2,182,222 shares in total) in 2020 with a deduction from the treasuryshare of RMB 53,093,544.55, including a reduction of RMB 2,182,222.00 in share capital, and RMB50,911,322.55 in capital reserve.
In addition, as at 31 January 2019, at the 19th session of the fourth Board of Directors, the Proposalof Repurchasing Shares by Centralised Price Bidding was approved, under which the Companyrepurchased a portion of corporate shares for employee stock ownership plan or share-basedincentive plan through centralised price bidding by self-owned funds; a total of 11,010,729.00 shareswere repurchased and treasury stock of RMB 394,992,892.71 was recognised.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(44) Special reserve
| 31 December 2019 | Increase in the current period | Decrease in the current period | 30 June 2020 | ||||
| Safety reserve | - | 12,187,435.48 | (12,187,435.48) | - |
| 31 December 2018 | Increase in the current period | Decrease in the current period | 30 June 2019 | ||||
| Safety reserve | - | 3,776,493.37 | (3,776,493.37) | - |
Pursuant to the Administrative Measures for the Collection and Utilisation of Enterprise Work SafetyFunds (Cai Qi [2012] No. 16) issued by the Ministry of Finance and the State Administration of WorkSafety on 14 February 2012, 1% of the income from the “Common cargo transportation business”which is operated by certain subsidiaries of the Group is appropriated to safety reserve. The safetyreserve is recognised in profit or loss as the “Special reserve” item for the current period. When theaccrued safety reserve is used under the prescribed conditions, it is written off against the originalamount directly.
(45) Surplus reserve
| 31 December 2019 | Increase in the current period | Decrease in the current period | 30 June 2020 | ||||
| Statutory surplus reserve | 601,241,237.54 | - | - | 601,241,237.54 |
| 31 December 2018 | Increase in the current period | Decrease in the current period | 30 June 2019 | ||||
| Statutory surplus reserve | 601,132,890.32 | - | - | 601,132,890.32 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(46) Retained earnings
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Retained earnings at the end of the prior year before adjustment | 19,737,192,610.27 | 14,960,062,609.04 | |
| Adjust for: Changes in accounting policies | 32,220,405.39 | - | |
| Retained earnings at the beginning of the period after adjustment | 19,769,413,015.66 | 14,960,062,609.04 | |
| Add: Net profit attributable to shareholders of the parent company for the current period | 3,761,593,296.43 | 3,099,808,006.37 | |
| Less: Ordinary share dividends payable (a) | (1,188,301,851.36) | (924,735,176.17) | |
| Appropriation to general risk reserve (b) | (2,344,717.97) | - | |
| Transfer from other comprehensive income to retained earnings | - | (54,334,158.75) | |
| Retained earnings at the end of the period | 22,340,359,742.76 | 17,080,801,280.49 | |
(a) The Company held a shareholders’ meeting on 15 April 2020. On the basis of the total share capital
at the registration date on which the 2019 profit distribution plan was implemented less the specialshares repurchased by the Company, a total of RMB 1,188,891,851.30 of cash dividends weredistributed to all shareholders at RMB 2.70 (including tax) per 10 shares, without bonus sharesbeing given or capital reserve being transferred into the share capital.
During the reporting period, the Company adjusted ordinary share dividends by RMB 589,999.94 intotal, based on the number of restricted shares that are expected not to be unlocked for therestricted shares incentive plan for 2018 and thus the ordinary share dividends payable waschanged to RMB 1,188,301,851.36.
(b) Pursuant to the Circular on Strengthening the Supervision and Management of Commercial
Factoring Enterprises issued by the General Office of the China Banking and Insurance RegulatoryCommission (Yin Bao Jian Ban Fa [2019] No. 205), for the factoring business, risk reserve of 1% ofthe ending balance of the financing factoring business is required. During the reporting period,Lefeng Factoring, a subsidiary of the Group, made an appropriation to the risk reserve inaccordance with the requirement.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(47) Minority interests
| 30 June 2020 | 31 December 2019 | ||
| Havi Hong Kong | 172,046,094.77 | 178,891,025.84 | |
| Hangzhou SF Intra-city Industrial Co., Ltd. | 98,945,890.40 | (1,640,347.84) | |
| Chongqing Fonair UAS Technology Co., Ltd. | 77,611,379.34 | - | |
| S.F. Express | 59,516,921.23 | - | |
| Guangdong Fengxing Zhitu Technology Co., Ltd. | 59,028,907.72 | - | |
| Beijing S.F. Intra-city Technology Co., Ltd. | 31,400,366.37 | 27,723,750.30 | |
| Wulian Yida | 24,511,067.05 | 29,887,545.67 | |
| Chengdu Fengcheng | (13,161,361.13) | (14,361,885.94) | |
| Guangdong Shunxin | (261,040,845.67) | (156,475,162.33) | |
| Others | 29,621,460.07 | 9,872,315.88 | |
| 278,479,880.15 | 73,897,241.58 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(48) Revenue and cost of revenue
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Revenue from main operations (a) | 71,028,669,391.17 | 50,023,101,039.35 | |
| Revenue from other operations (b) | 100,338,347.04 | 51,602,994.50 | |
| Total revenue | 71,129,007,738.21 | 50,074,704,033.85 | |
| Cost of revenue from main operations (a) | 57,799,242,648.49 | 40,120,963,760.73 | |
| Cost of revenue from other operations (b) | 63,886,252.92 | 31,080,464.00 | |
| Total cost of revenue | 57,863,128,901.41 | 40,152,044,224.73 |
(a) Revenue and cost of revenue from main operations:
| For the six months ended 30 June 2020 | For the six months ended 30 June 2019 | ||||||
| Revenue from main operations | Cost of revenue from main operations | Revenue from main operations | Cost of revenue from main operations | ||||
| Express delivery and supply chain | 70,188,001,144.10 | 57,121,320,304.19 | 49,479,804,469.27 | 39,676,010,637.56 | |||
| Sales of goods | 452,123,296.72 | 427,084,226.66 | 253,670,085.55 | 244,437,355.69 | |||
| Others | 388,544,950.35 | 250,838,117.64 | 289,626,484.53 | 200,515,767.48 | |||
| 71,028,669,391.17 | 57,799,242,648.49 | 50,023,101,039.35 | 40,120,963,760.73 | ||||
(b) Revenue and cost of revenue from other operations:
| For the six months ended 30 June 2020 | For the six months ended 30 June 2019 | ||||||
| Revenue from other operations | Cost of revenue from other operations | Revenue from other operations | Cost of revenue from other operations | ||||
| Disposal of materials | 3,792,612.75 | 1,628,114.57 | 5,366,068.43 | 3,135,831.83 | |||
| Others | 96,545,734.29 | 62,258,138.35 | 46,236,926.07 | 27,944,632.17 | |||
| 100,338,347.04 | 63,886,252.92 | 51,602,994.50 | 31,080,464.00 | ||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(48) Revenue and cost of revenue from other operations:
(c) The Group's revenue for the six months ended 30 June 2020 was disaggregatedas follows:
| For the six months ended 30 June 2020 | |||||||
| Express delivery and supply chain | Sales of goods | Others | Total | ||||
| Revenue from main operations | |||||||
| Including: At a point in time | - | 452,123,296.72 | 121,445,767.94 | 573,569,064.66 | |||
| Over time | 70,188,001,144.10 | - | 209,208,521.52 | 70,397,209,665.62 | |||
| Lease income | - | - | 57,890,660.89 | 57,890,660.89 | |||
| 70,188,001,144.10 | 452,123,296.72 | 388,544,950.35 | 71,028,669,391.17 | ||||
| Revenue from other operations | |||||||
| Including: At a point in time | - | - | 3,792,612.75 | 3,792,612.75 | |||
| Over time | - | - | 31,371,734.05 | 31,371,734.05 | |||
| Lease income | - | - | 65,174,000.24 | 65,174,000.24 | |||
| - | - | 100,338,347.04 | 100,338,347.04 | ||||
As at 30 June 2020, the performance obligation of the Group that had been contracted but not yetperformed or not fulfilled was part of contracts with expected maturity within one year.
(49) Taxes and surcharges
| For the six months ended 30 June | Payment criterion | |||
| 2020 | 2019 | |||
| City maintenance and construction tax | 70,719,764.91 | 38,783,027.88 | Refer to Note 3 | |
| Educational surcharge | 51,122,638.61 | 28,667,288.45 | Refer to Note 3 | |
| Stamp tax | 33,782,373.62 | 26,200,182.24 | ||
| Property tax | 20,500,315.63 | 20,621,947.62 | ||
| Land use tax | 4,540,245.80 | 6,348,514.64 | ||
| Flood-control project expenses | 102,619.07 | 117,176.63 | ||
| Others | 1,083,730.16 | 377,126.98 | ||
| 181,851,687.80 | 121,115,264.44 | |||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(50) Selling and distribution expenses
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Employee benefits | 400,354,453.54 | 318,516,919.75 | |
| Outsourcing expenses of information technology service | 277,321,643.40 | 208,263,429.24 | |
| IT and information platform expenses | 100,204,009.91 | 90,956,344.09 | |
| Marketing expenses | 93,535,249.52 | 105,880,810.06 | |
| Depreciation and amortisation expenses | 89,629,461.92 | 69,638,430.07 | |
| Office and rental fees | 50,945,774.92 | 57,352,090.67 | |
| Supply and material expenses | 11,194,918.81 | 13,090,938.53 | |
| Travelling and transportation expenses | 9,382,883.02 | 13,360,798.14 | |
| Others | 24,090,306.89 | 7,498,378.66 | |
| 1,056,658,701.93 | 884,558,139.21 | ||
(51) General and administrative expenses
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Employee benefits | 4,858,862,486.41 | 3,890,037,390.50 | |
| Office and rental fees | 255,935,823.26 | 258,311,322.40 | |
| Depreciation and amortisation expenses | 148,253,379.17 | 210,542,576.67 | |
| Outsourcing expenses | 118,052,450.55 | 32,908,843.71 | |
| Professional service fees | 115,324,486.22 | 145,896,331.98 | |
| Supply and material expenses | 76,137,816.90 | 30,892,230.32 | |
| Entertainment expenses | 68,271,706.15 | 83,172,264.44 | |
| Brand royalties | 55,109,364.65 | 35,565,574.35 | |
| IT and information platform expenses | 52,851,185.87 | 27,373,472.94 | |
| Travelling and transportation expenses | 42,838,862.22 | 64,149,585.92 | |
| Taxes | 6,201,858.42 | 14,129,992.87 | |
| Others | 63,603,742.91 | 51,862,693.47 | |
| 5,861,443,162.73 | 4,844,842,279.57 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(52) Research and development expenses
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Employee benefits | 425,321,626.35 | 274,413,117.59 | |
| Depreciation and amortisation expenses | 148,462,487.06 | 108,581,274.94 | |
| Outsourcing expenses | 47,050,197.27 | 21,612,421.02 | |
| Supply and material expenses | 34,290,640.40 | 2,380,344.87 | |
| IT and information platform expenses | 29,352,477.08 | 62,492,335.64 | |
| Office and rental fees | 22,823,668.49 | 16,593,373.66 | |
| Professional service fees | 16,619,041.55 | 8,386,104.63 | |
| Travelling and transportation expenses | 2,769,613.47 | 8,374,048.34 | |
| Others | 6,649,876.74 | 6,261,353.20 | |
| 733,339,628.41 | 509,094,373.89 | ||
(53) Financial costs
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Interest on borrowings | 578,195,340.26 | 443,050,621.03 | |
| Less: Capitalised interest (Note 4(18)) | (10,137,901.97) | (10,096,711.26) | |
| Interest expenses | 568,057,438.29 | 432,953,909.77 | |
| Less: Interest income | (78,055,138.82) | (140,657,963.28) | |
| Net gains or losses on exchange | (32,405,986.92) | 4,779,048.26 | |
| Commission expenses and others | 15,371,157.37 | 34,538,351.63 | |
| 472,967,469.92 | 331,613,346.38 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(54) Expenses by nature
The cost of revenue, selling and distribution expenses, general and administrative expenses andresearch and development expenses in the income statement are listed as follows by nature:
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Outsourcing cost | 36,000,601,551.98 | 22,516,293,483.01 | |
| Employee benefits | 12,286,229,366.65 | 10,188,123,515.18 | |
| Transportation cost | 6,127,474,359.27 | 4,591,767,428.13 | |
| Including: Aircraft maintenance costs | 153,749,892.99 | 122,550,201.24 | |
| Office and rental fees | 3,814,075,460.69 | 3,370,876,598.64 | |
| Depreciation and amortisation expenses | 2,600,262,280.82 | 2,113,897,345.59 | |
| Supply and material expenses | 2,183,349,831.19 | 1,821,849,752.17 | |
| IT and information platform expenses | 529,974,865.83 | 376,367,330.53 | |
| Claims expenses | 511,571,470.00 | 286,839,014.36 | |
| Cost of revenue of goods | 427,084,226.66 | 244,437,355.69 | |
| Professional service fees | 132,959,967.33 | 154,282,436.60 | |
| Customs cost | 190,902,692.93 | 146,219,546.06 | |
| Travelling and transportation expenses | 98,215,008.51 | 121,361,655.21 | |
| Marketing expenses | 93,535,249.52 | 105,880,810.06 | |
| Brand royalties | 55,109,364.65 | 35,565,574.35 | |
| Taxes | 7,446,679.90 | 15,370,055.24 | |
| Others | 455,778,018.55 | 301,407,116.58 | |
| 65,514,570,394.48 | 46,390,539,017.40 | ||
For the six months ended 30 June 2020, the Group’s government grants which were offset againstcost and expenses amounted to RMB 121,775,212.56 (for the six months ended 30 June 2019:
RMB 44,298,310.60) and were fully offset against the cost of revenue. Therein, the amount that wasrecognised in non-recurring profit or loss amounted to RMB 121,775,212.56 (for the six monthsended 30 June 2019: RMB 44,298,310.60).
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(55) Other income
| For the six months ended 30 June | Related to assets /income | |||
| 2020 | 2019 | |||
| Tax preference | 363,926,959.65 | 54,037,453.25 | Related to income | |
| Fiscal appropriation for logistics | 212,152,645.32 | 75,056,584.88 | Related to income | |
| Grant from Social Security Bureau | 52,657,030.26 | 18,743,054.92 | Related to income | |
| Amortisation of deferred income | ||||
| (Note 4(38)) | 16,973,417.75 | 16,509,299.54 | Related to assets | |
| 645,710,052.98 | 164,346,392.59 | |||
(56) Investment income
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Investment income from sale of equity interests of Fengyi Technology | - | 216,691,565.20 | |
| Investment income from financial assets held for trading | 213,247,428.71 | 79,742,073.62 | |
| Share of net gains or losses of investees under equity method (Note 4(13)) | (18,447,519.77) | (50,985,409.53) | |
| Investment income from remeasurement of the remaining equity interests in Fengyi Technology measure at fair value | - | 64,204,908.21 | |
| Investment income from wealth management products | 10,247,466.29 | 29,086,155.52 | |
| Investments income from dividends of investment in other equity instruments | 1,110,356.12 | - | |
| Income from disposal of other long-term equity investments | 17,260,427.11 | 47,334,607.83 | |
| 223,418,158.46 | 386,073,900.85 | ||
There is no significant restriction on recovery of investment income of the Group.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(57) Gains arising from changes in fair value
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| SAFE and discounted warrants | - | 304,239,702.03 | |
| Structural deposits | 16,384,538.57 | 9,960,802.13 | |
| Others | 29,414.59 | 16,007,107.39 | |
| 16,413,953.16 | 330,207,611.55 | ||
(58) Credit impairment losses
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Losses on bad debts of accounts receivable | 205,151,831.67 | 79,264,307.29 | |
| Losses on bad debts of other receivables | 114,672,175.85 | 13,044,791.88 | |
| Losses on impairment of loans and advances | 89,186,630.95 | 3,475,742.51 | |
| Losses on impairment of factoring receivables | 49,601,393.26 | 53,080,511.77 | |
| Losses on impairment of long-term receivables | 929,070.18 | - | |
| 459,541,101.91 | 148,865,353.45 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(59) Asset impairment losses
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Losses on impairment of intangible assets | 23,599,356.05 | 37,001,101.69 | |
| Losses on impairment of long-term equity investments | 3,869,728.47 | 17,111,077.45 | |
| 27,469,084.52 | 54,112,179.14 | ||
(60) Losses on disposal of assets
| For the six months ended 30 June | |||||||
| 2020 | Amount recognised in non-recurring profit or loss in 2020 | 2019 | Amount recognised in non-recurring profit or loss in 2019 | ||||
| Losses on disposal of fixed assets | 8,253,122.38 | 8,253,122.38 | 12,876,151.73 | 12,876,151.73 | |||
| Losses on disposal of intangible assets | 1,393,369.11 | 1,393,369.11 | - | - | |||
| 9,646,491.49 | 9,646,491.49 | 12,876,151.73 | 12,876,151.73 | ||||
(61) Non-operating income and expenses
(a) Non-operating income
| For the six months ended 30 June | |||||||
| 2020 | Amount recognised in non-recurring profit or loss in 2020 | 2019 | Amount recognised in non-recurring profit or loss in 2019 | ||||
| Government grants (i) | 13,929,041.59 | 13,929,041.59 | 17,708,816.27 | 17,708,816.27 | |||
| Compensation income | 9,155,484.11 | 9,155,484.11 | 5,971,898.89 | 5,971,898.89 | |||
| Income from penalty | 1,323,994.46 | 1,323,994.46 | 1,198,197.30 | 1,198,197.30 | |||
| Others | 65,325,265.46 | 65,325,265.46 | 45,274,628.31 | 45,274,628.31 | |||
| 89,733,785.62 | 89,733,785.62 | 70,153,540.77 | 70,153,540.77 | ||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(61) Non-operating income and expenses (Cont’d)
(a) Non-operating income (Cont'd)
(i) Details of government grants
| For the six months ended 30 June 2020 | Related to assets/income | For the six months ended 30 June 2019 | Related to assets/income | |
| General fiscal appropriation | 13,301,583.00 | Related to income | 16,722,833.19 | Related to income |
| Others | 627,458.59 | Related to income | 985,983.08 | Related to income |
| 13,929,041.59 | 17,708,816.27 |
(b) Non-operating expenses
| For the six months ended 30 June | |||||||
| 2020 | Amount recognised in non-recurring profit or loss in 2020 | 2019 | Amount recognised in non-recurring profit or loss in 2019 | ||||
| Losses on scrapping of fixed assets and intangible assets | 39,789,802.73 | 39,789,802.73 | - | - | |||
| Donation expenses | 21,610,987.55 | 21,610,987.55 | 5,150,996.20 | 5,150,996.20 | |||
| Compensation expenses | 19,230,955.69 | 19,230,955.69 | 19,532,798.24 | 19,532,798.24 | |||
| Penalties and overdue fines | 6,876,977.69 | 6,876,977.69 | 8,615,819.45 | 8,615,819.45 | |||
| Others | 11,964,928.43 | 11,964,928.44 | 8,461,646.82 | 8,461,646.82 | |||
| 99,473,652.09 | 99,473,652.10 | 41,761,260.71 | 41,761,260.71 | ||||
(62) Income tax expenses
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Current income tax | 1,466,179,044.85 | 891,418,578.47 | |
| Deferred income tax | 248,819,602.15 | (8,776,281.95) | |
| 1,714,998,647.00 | 882,642,296.52 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(62) Income tax expenses (Cont'd)
The reconciliation from income tax calculated based on the applicable tax rates and total profitpresented in the income statement to the income tax expenses is listed below:
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Total profit | 5,338,763,806.22 | 3,924,602,906.36 | |
| Income tax expenses calculated at the standard tax rate of 25% | 1,334,690,951.56 | 981,150,726.59 | |
| Costs, expenses and losses not deductible for tax purposes | 38,667,142.36 | 39,552,923.73 | |
| Effect of last-year tax filing differences | 13,660,450.66 | (29,736,018.06) | |
| Effect of different tax rates among different subsidiaries and branches on income tax expenses | (93,873,206.20) | (43,180,878.92) | |
| Deductible tax losses and deductible temporary differences for which no deferred tax asset was recognised in the current period | 413,291,203.23 | 141,988,978.79 | |
| Reversal of previously recognised deductible losses for which deferred tax asset was recognised | 68,065,341.58 | 44,911,454.39 | |
| Utilisation of deductible tax losses and other deductible temporary differences for which no deferred tax asset was recognised in prior periods | (46,570,727.68) | (134,263,952.26) | |
| Recognition of deductible tax losses and other deductible temporary differences for which no deferred tax asset was recognised in prior periods | (1,723,041.10) | (2,500,000.00) | |
| Effect of tax preference | (5,000,000.00) | (10,678,902.56) | |
| Income not subject to tax | (6,209,467.41) | (104,602,035.18) | |
| Income tax expenses | 1,714,998,647.00 | 882,642,296.52 | |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(63) Earnings per share
(a) Basic earnings per share
Basic earnings per share are calculated by dividing consolidated net profit attributable to ordinaryshareholders of the parent company by the weighted average number of outstanding ordinaryshares of the parent company:
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Consolidated net profit attributable to ordinary shareholders of the parent company | 3,761,593,296.43 | 3,099,808,006.37 | |
| Less: Cash dividends distributed to holders whose restricted shares are expected to be unlocked | - | (503,792.87) | |
| Adjusted consolidated net profit attributable to ordinary shareholders of the parent company for calculation of earnings per share | 3,761,593,296.43 | 3,099,304,213.50 | |
| Weighted average number of outstanding ordinary shares of the Company | 4,401,118,670.17 | 4,407,421,565.50 | |
| Basic earnings per share | 0.85 | 0.70 | |
| Including: | |||
| - Basic earnings per share from continuing operations | 0.85 | 0.70 | |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(63) Earnings per share (Cont’d)
(b) Diluted earnings per share
Diluted earnings per share are calculated by dividing consolidated net profit attributable to ordinaryshareholders of the parent company adjusted based on the dilutive potential ordinary shares by theadjusted weighted average number of outstanding ordinary shares of the Company. For the sixmonths ended 30 June 2020, the Company had dilutive potential ordinary shares (for the six monthsended 30 June 2019: Nil):
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Consolidated net profit attributable to ordinary shareholders of the parent company | 3,761,593,296.43 | 3,099,808,006.37 | |
| Add: Interest expenses from convertible corporate debentures of the Company(net of tax) | 98,688,033.29 | - | |
| Less: Effect of convertible corporate debentures issued by subsidiaries on the net profit attributable to shareholders of the Company | (3,995,114.22) | - | |
| Adjusted consolidated net profit attributable to ordinary shareholders of the parent company for calculation of earnings per share | 3,856,286,215.50 | 3,099,808,006.37 | |
| Weighted average number of outstanding ordinary shares of the Company | |||
| 4,401,118,670.17 | 4,407,421,565.50 | ||
| Add: Weighted average number of ordinary shares which convertible corporate debentures assumed to be fully converted into ordinary shares | 143,843,934.67 | - | |
| Weighted average number of outstanding diluted ordinary shares | 4,544,962,604.84 | 4,407,421,565.50 | |
| Diluted earnings per share | 0.85 | 0.70 | |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(64) Other comprehensive income
Other comprehensive income, the related income tax effect and the reclassifications to profit or loss for the six months ended 30 June 2020 and 2019:
| Other comprehensive income in the balance sheet | Other comprehensive income in the income statement for the six months ended 30 June 2020 | ||||||||||||
| 31 December 2019 | Attributable to the parent company in the current period - net of tax | 30 June 2020 | Amount incurred before income tax for the current period | Less: Income tax | Attributable to the parent company - net of tax | Attributable to minority shareholders - net of tax | |||||||
| Other comprehensive income items which will not be reclassified subsequently to profit or loss | |||||||||||||
| Changes in fair value of investments in other equity instruments and exchange rate changes | 721,903,970.41 | 40,865,087.90 | 762,769,058.31 | 38,610,400.40 | (2,254,687.50) | 40,865,087.90 | - | ||||||
| Other comprehensive income that will not be subsequently transferred to profit or loss under the equity method | (2,059,919.82) | 873,013.64 | (1,186,906.18) | 873,013.64 | - | 873,013.64 | - | ||||||
| Other comprehensive income items which will be reclassified subsequently to profit or loss | |||||||||||||
| Exchange differences on translation of foreign currency financial statements | 282,871,556.79 | 104,744,398.17 | 387,615,954.96 | 104,615,596.10 | - | 104,744,398.17 | (128,802.07) | ||||||
| 1,002,715,607.38 | 146,482,499.71 | 1,149,198,107.09 | 144,099,010.14 | (2,254,687.50) | 146,482,499.71 | (128,802.07) | |||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(64) Other comprehensive income (Cont'd)
| Other comprehensive income in the balance sheet | Movements in other comprehensive income for the six months ended 30 June 2019 | ||||||||||||||||||
| 31 December 2018 | Changes in accounting policies | 1 January 2019 | Attributable to the parent company in the current period - net of tax | Other comprehensive income transferred into retained earnings | 30 June 2019 | Amount incurred before income tax for the current period | Less: Income tax | Attributable to the parent company - net of tax | Attributable to minority shareholders - net of tax | ||||||||||
| Other comprehensive income items which will not be reclassified subsequently to profit or loss | |||||||||||||||||||
| Changes in fair value of investments and exchange rate in other equity instruments | - | 353,622,821.31 | 353,622,821.31 | (21,354,283.70) | 54,334,158.75 | 386,602,696.36 | 24,629,582.65 | (45,983,866.35) | (21,354,283.70) | - | |||||||||
| Other comprehensive income items which will be reclassified subsequently to profit or loss | |||||||||||||||||||
| Other comprehensive income that will be subsequently transferred to profit or loss under the equity method | - | - | - | (1,956,923.83) | - | (1,956,923.83) | (1,956,923.83) | - | (1,956,923.83) | - | |||||||||
| Changes in fair value of available-for-sale financial assets | 336,157,723.57 | (336,157,723.57) | - | - | - | - | - | - | - | - | |||||||||
| Exchange differences on translation of foreign currency financial statements | 191,026,574.28 | - | 191,026,574.28 | 15,179,377.55 | - | 206,205,951.83 | 15,265,426.96 | - | 15,179,377.55 | 86,049.41 | |||||||||
| 527,184,297.85 | 17,465,097.74 | 544,649,395.59 | (8,131,829.98) | 54,334,158.75 | 590,851,724.36 | 37,938,085.78 | (45,983,866.35) | (8,131,829.98) | 86,049.41 | ||||||||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(65) Notes to the cash flow statement
(a) Cash received relating to other operating activities
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Inflows from cash on delivery service | 34,825,543,143.63 | 24,744,324,674.22 | |
| Government grants | 389,538,947.63 | 202,754,430.01 | |
| Interest income | 85,061,683.52 | 153,109,828.49 | |
| Finance lease received | - | 23,511,252.99 | |
| Others | 820,792,110.16 | 504,836,201.01 | |
| 36,120,935,884.94 | 25,628,536,386.72 | ||
(b) Cash paid relating to other operating activities
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Outflows from cash on delivery service | 34,807,712,241.80 | 25,075,406,925.83 | |
| Office and rental fees | 4,033,369,059.71 | 3,138,563,186.87 | |
| Claims expenses | 511,571,470.00 | 286,839,014.36 | |
| IT and information platform expenses | 561,773,357.78 | 398,949,370.36 | |
| Professional service fees | 139,203,648.33 | 149,812,306.12 | |
| Travelling and transportation expenses | 104,107,909.02 | 128,643,343.73 | |
| Marketing expenses | 99,147,364.49 | 112,233,658.66 | |
| Customs cost | 198,763,824.92 | 143,435,811.24 | |
| Entertainment expenses | 73,637,732.75 | 89,436,984.88 | |
| Bank charges | 15,371,157.37 | 34,538,651.63 | |
| Compensation and penalty | 26,107,933.38 | 28,148,617.69 | |
| Donation expenses | 21,610,987.55 | 5,150,996.20 | |
| Others | 894,418,352.01 | 511,994,741.17 | |
| 41,486,795,039.11 | 30,103,153,608.74 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(65) Notes to the cash flow statement (Cont’d)
(c) Net cash paid to acquire subsidiaries
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Cash and cash equivalents paid in the current period for acquisition of subsidiaries incurred in the current period | - | 5,346,964,309.54 | |
| Including: DHL HK and DHL BJ | - | 5,325,964,309.54 | |
| Other companies | - | 21,000,000.00 | |
| Less: Cash and cash equivalents held by subsidiaries at the acquisition date | - | (265,848,954.38) | |
| Including: DHL HK and DHL BJ | - | (254,733,022.95) | |
| Other companies | - | (11,115,931.43) | |
| Add: Cash paid in the current period for acquisition of subsidiaries incurred in prior periods | - | 86,411,295.00 | |
| - | 5,167,526,650.16 | ||
(d) Cash received relating to other investing activities
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Redemption of bank wealth management products and structural deposits | 52,830,000,000.00 | 19,610,047,058.44 | |
(e) Cash paid relating to other investing activities
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Purchase of bank wealth management products and structural deposits | 66,895,117,931.29 | 23,960,239,249.75 | |
| Net cash paid for disposal of subsidiaries | 36,217,441.31 | - | |
| Others | - | 14,800,000.00 | |
| 66,931,335,372.60 | 23,975,039,249.75 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(65) Notes to the cash flow statement (Cont’d)
(f) Cash payments relating to other financing activities
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Repurchase of shares | 58,663,220.22 | 503,763,032.93 | |
| Payment of financing expenses | 16,994,486.97 | 7,961,098.15 | |
| Acquisition of minority interests | 7,308,000.00 | - | |
| Others | 379,410.22 | - | |
| 83,345,117.41 | 511,724,131.08 | ||
(66) Supplementary information to the cash flow statement
(a) Reconciliation from net profit to cash flows from operating activities
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Net profit | 3,623,765,159.22 | 3,041,960,609.84 | |
| Add:Provision for asset impairment | 27,469,084.52 | 54,112,179.14 | |
| Provision for credit impairment | 459,541,101.91 | 148,865,353.45 | |
| Depreciation of fixed assets | 1,730,365,263.08 | 1,421,439,131.46 | |
| Depreciation of investment properties | 27,251,110.81 | 32,605,157.06 | |
| Amortisation of intangible assets | 457,822,929.32 | 317,407,225.33 | |
| Amortisation of long-term prepaid expenses | 393,322,855.05 | 342,445,831.74 | |
| Losses on disposal of fixed assets and intangible assets | 49,436,294.22 | 12,876,151.73 | |
| Gains arising from changes in fair value | (16,413,953.16) | (330,207,611.55) | |
| Financial costs | 524,673,273.00 | 438,039,577.86 | |
| Investment income | (223,418,158.46) | (386,073,900.85) | |
| Recognised expenses on share-based payments | 54,253,366.54 | 15,597,712.81 | |
| Decrease/(Increase) in deferred tax assets | 54,902,793.10 | (108,325,029.39) | |
| Increase in deferred tax liabilities | 193,916,809.05 | 99,548,747.44 | |
| Amortisation of deferred income | (16,973,417.75) | (16,509,299.54) | |
| Decrease in inventories | 47,227,069.11 | 73,895,759.23 | |
| (Increase)/Decrease in operating receivables | (2,163,201,334.61) | 762,706,058.73 | |
| Increase/(Decrease) in operating payables | 1,707,772,075.15 | (1,099,570,037.93) | |
| Net cash flows from operating activities | 6,931,712,320.10 | 4,820,813,616.56 | |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(66) Supplementary information to the cash flow statement (Cont'd)
(b) Net increase/(decrease) in cash and cash equivalents
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Cash and cash equivalents at the end of the period | 9,390,724,718.39 | 11,928,010,057.41 | |
| Less: Cash and cash equivalents at the beginning of the period | (17,764,448,498.26) | (15,299,271,593.99) | |
| Net decrease in cash and cash equivalents | (8,373,723,779.87) | (3,371,261,536.58) | |
(c) Cash and cash equivalents
| 30 June 2020 | 31 December 2019 | ||
| Cash on hand | 195,351.88 | 188,281.28 | |
| Cash at bank that can be readily drawn on demand | 9,285,130,123.77 | 17,662,057,153.84 | |
| Other cash balances that can be readily drawn on demand | 29,886,738.69 | 21,599,389.56 | |
| Other balances that can be readily drawn on demand | 75,512,504.05 | 80,603,673.58 | |
| 9,390,724,718.39 | 17,764,448,498.26 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(67) Monetary items denominated in foreign currency
As at 30 June 2020, the Group’s companies whose recording currency is RMB held assets andliabilities denominated in non-recording currency (mainly USD, HKD and EUR), of which theequivalent amounts in RMB (presentation currency of these financial statements) are listed as below(31 December 2019: Immaterial):
| 30 June 2020 | |||||
| Amount in original currency | Exchange rate to RMB | Equivalent to RMB | |||
| Cash at bank and on hand - | |||||
| USD | 143,059,700.63 | 7.08 | 1,012,791,150.61 | ||
| HKD | 10,446,158.20 | 0.91 | 9,541,938.75 | ||
| EUR | 99,925.99 | 7.96 | 795,510.81 | ||
| Accounts receivable - | |||||
| USD | 6,947,532.18 | 7.08 | 49,185,054.07 | ||
| HKD | 37,580.56 | 0.91 | 34,327.59 | ||
| EUR | 3,477,292.68 | 7.96 | 27,682,727.03 | ||
| Accounts payable - | |||||
| USD | 11,372,875.74 | 7.08 | 80,514,273.80 | ||
| HKD | 1,513,996.91 | 0.91 | 1,382,945.34 | ||
| EUR | 739,315.11 | 7.96 | 5,885,687.59 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
4 Notes to the consolidated financial statements (Cont’d)
(67) Monetary items denominated in foreign currency (Cont’d)
As at 30 June 2020 and 31 December 2019, the Group's overseas subsidiaries, except for thoseoperating in Hong Kong, held no significant financial assets and liabilities denominated in foreigncurrencies. Those companies operating in Hong Kong with HKD as recording currency held financialassets and liabilities denominated in foreign currency (mainly USD, RMB and EUR), of which theequivalent amounts in HKD (recording currency of companies operating in Hong Kong) and RMB(presentation currency of these financial statements) are listed as below:
| 30 June 2020 | |||||||
| Amount in original currency | Exchange rate to HKD | Equivalent to HKD | Equivalent to RMB | ||||
| Cash at bank and on hand - | |||||||
| RMB | 91,196,541.23 | 1.09 | 99,841,973.34 | 91,196,541.23 | |||
| USD | 5,869,199.81 | 7.75 | 45,488,646.21 | 41,551,000.05 | |||
| EUR | 343,592.98 | 8.72 | 2,994,550.26 | 2,735,343.71 | |||
| Accounts receivable - | |||||||
| RMB | 833,300.52 | 1.09 | 912,297.41 | 833,300.52 | |||
| USD | 5,608,490.03 | 7.75 | 43,468,041.13 | 39,705,305.17 | |||
| Accounts payable - | |||||||
| RMB | 3,533,622.13 | 1.09 | 3,868,609.51 | 3,533,622.13 | |||
| USD | 4,331,943.54 | 7.75 | 33,574,295.21 | 30,667,994.29 | |||
| EUR | 4,013,029.50 | 8.72 | 34,975,157.30 | 31,947,727.85 | |||
| Other payables - | |||||||
| RMB | 292,603.11 | 1.09 | 320,341.88 | 292,603.11 | |||
| USD | 3,085,685.95 | 7.75 | 23,915,300.39 | 21,845,113.68 | |||
| 31 December 2019 | |||||||
| Amount in original currency | Exchange rate to HKD | Equivalent to HKD | Equivalent to RMB | ||||
| Cash at bank and on hand - | |||||||
| RMB | 32,931,459.92 | 1.12 | 36,761,388.71 | 32,931,459.92 | |||
| USD | 4,200,856.59 | 7.79 | 32,715,430.95 | 29,306,015.74 | |||
| Accounts receivable - | |||||||
| RMB | 40,650,563.07 | 1.12 | 45,378,223.56 | 40,650,563.07 | |||
| USD | 3,533,004.73 | 7.79 | 27,514,334.24 | 24,646,947.60 | |||
| Accounts payable - | |||||||
| RMB | 5,909,505.28 | 1.12 | 6,596,780.74 | 5,909,505.28 | |||
| USD | 4,632,606.94 | 7.79 | 36,077,816.33 | 32,317,992.53 | |||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
5 Changes in the consolidation scope
(1) Business combinations involving enterprises not under common control
On 30 September 2019, Shenzhen Yifeng Technology Co., Ltd. (“Yifeng Technology”), one of theCompany’s subsidiaries, acquired 100% equity of Hangzhou Zhentai Assets management Co., Ltd("Hangzhou Zhentai"). held by Shenzhen Mingde Fengtai Investment Co., Ltd. (“MingdeInvestment”), a related party which was under common control of Mingde Holdings, the ultimateparent company. The combination date of this transaction is 30 September 2019, on which YifengTechnology effectively obtained the control over Hangzhou Zhentai. This transaction is classified asa business combination involving enterprises under common control as Hangzhou Zhentai andYifeng Technology are both ultimately controlled by Mingde Holdings prior and subsequent to thecombination and the control is not temporary.
For the above subsidiary that is acquired in a business combination involving enterprises undercommon control, it was included in the consolidated financial statements from the date when it,together with the Company, became under common control of the ultimate controlling party. TheCompany adjusted the comparative consolidated financial statements for the six months ended 30June 2019.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
5 Changes in the consolidation scope (Cont'd)
(2) Other changes in the consolidation scope
(a) For the six months ended 30 June 2020, the Group set up the following subsidiaries by cash:
Shenzhen S.F. Kuaicha Technology Co., Ltd.Shenzhen Weifengqi Technology Co., Ltd.Shenzhen Fengyun Investment Co., Ltd.Shanghai Fengzan Technology Co., Ltd.Guangzhou S.F. Cold Chain Co., Ltd.Wuhan S.F. Cold Chain Co., Ltd.Shanghai S.F. Cold Chain Co., Ltd.Shenzhen Fengwang Express Co., Ltd.Hangzhou Fengwang Express Co., Ltd.Luoyang Fengtai Industrial Park Management Co., Ltd.Beijing Zhenlanwuxian Technology Co., Ltd.Xiamen Fengyi Supply Chain Management Co., Ltd.Changsha Fengyi Supply Chain Management Co., Ltd.Tianjin S.F. Juyi Logistics Co., Ltd.Jiangxi S.F. Zhida Network Technology Co., Ltd.Liuzhou Fengyutai Industrial Park Management Co., Ltd.S.F. Technology Solution (HongKong) Limited.FS TECHNOLOGY MACAU CO.,LTD.Shanghai Bingzhi Supply Chain Management Co., Ltd.Cheng Run Limited.Shanghai Yongfang Supply Chain Technology Co., Ltd.Guangdong Shuangjie Supply Chain Co., Ltd.SF Supply Chain Chongqing (Hong Kong) Limited.Hunan S.F. Pharmaceutical Supply Chain Co., Ltd.Exel Supply Chain (Dalian) Co., Ltd.Henan S.F. Pharmaceutical Supply Chain Co., Ltd.Hefei Exel Supply Chain Co., Ltd.S.F. Xiangyu (Shangdong) Pharmaceutical Logistics Co., Ltd.Zonghao Supply Chain Consulting (Shenzhen) Co., Ltd.Exel Supply Chain (Nanjing) Co., Ltd.Exel Supply Chain (Xiamen) Co., Ltd.Exel Supply Chain (Shanghai) Co., Ltd.Exel Supply Chain (Xi'an) Co., Ltd.Chongqing Fonair UAS Technology Co., Ltd.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
5 Changes in the consolidation scope (Cont'd)
(2) Other changes in the consolidation scope (Cont'd)
(a) For the six months ended 30 June 2020, the Group set up the following subsidiaries by cash:
(Cont'd)
Fujian Lijie Supply Chain Management Co., Ltd.Exel Supply Chain Management (Shanghai) Co., Ltd.SZSF Global Express (Kenya) LimitedMoral Up Corporation LimitedSF Express (Middle East) DWC-LLCS.F. E&L International (Cambodia) Co., Ltd.SF Express Philippines Inc.SF Express (Panama), S.A.SF Express Nigeria LimitedSF Logistics Mexico, S.A. De C.V.Abundant Harvest Investments LimitedSF International (Hong Kong) Management Company LimitedSF International Holding Company LimitedSF Express (Belgium) BVSF Express (Germany) GmbHSF Express (France) SASNH Logistics Limited
(b) For the six months ended 30 June 2020, the Group disposed and cancelled the following
subsidiaries:
Shenzhen Nianfeng. DDJ Technology Co., Ltd.Shenzhen Nianfeng. DDJ Commerce Co., Ltd.S.F. DDJ Technology (Hong Kong) Co., Ltd.Shenzhen Youli Technology Co., Ltd.Chengdu Yifeng Daojia Technology Service Co., Ltd.Guangdong Zhifan Technology Co., Ltd.Hengyang Hongyue Network Co., Ltd.Hengyang Wanwei Information Co., Ltd.
(c) For the six months ended 30 June 2020, subsidiaries acquired by the Group are as follows:
High spring global limited.Jade affluent limited.He chang trade limited.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
6 Interests in other entities
(1) Interests in subsidiaries
(a) First-tier and second-tier subsidiaries of the Group are as follows:
| Shareholding (%) | |||||||
| Place of registration | Major business location | Registered capital | Nature of business | Direct | Indirect | Method of acquisition | |
| Taisen Holdings | Shenzhen | Shenzhen | RMB 2 billion | Investment holding | 100.00% | - | Reverse acquisitions |
| S.F. Express Co., Ltd. | Shenzhen | Shenzhen | RMB 150 million | International freight forwarding, inbound and outbound express deliver, etc. | - | 100.00% | Business combination involving enterprises under common control |
| SF Technology | Shenzhen | Shenzhen | RMB 50 million | Technical maintenance and development service | - | 100.00% | By new establishment |
| Shenzhen Shunlu Logistics Co., Ltd. | Shenzhen | Shenzhen | RMB 150 million | Cargo transportation and freight forwarding | - | 100.00% | Business combination involving enterprises under common control |
| Anhui S.F. Telecommunication Service Co., Ltd. | Anhui Province | Anhui Province | RMB 50 million | Value-added telecommunication service | - | 100.00% | By new establishment |
| Shenzhen Yuhui Management Consulting Co., Ltd. | Shenzhen | Shenzhen | RMB 250 million | Consulting service | - | 100.00% | Business combination involving enterprises under common control |
| Shenzhen S.F. Supply Chain Co., Ltd. | Shenzhen | Shenzhen | RMB 700 million | Supply chain management and other services | - | 100.00% | By new establishment |
| SF Airlines | Shenzhen | Shenzhen | RMB 1,500 million | Transport service of aviation cargo | - | 100.00% | Business combination involving enterprises under common control |
| Dongguan Jiada Express Service Co., Ltd. | Dongguan | Dongguan | RMB 4 million | Cargo express agent service | - | 100.00% | Business combination involving enterprises under common control |
| Shenzhen Fengtai E-Commerce Industrial Park Asset Management Ltd. | Shenzhen | Shenzhen | RMB 4,800 million | E-Commerce industrial park asset management | - | 100.00% | Business combination involving enterprises under common control |
| Shenzhen Fengtai E-Commerce Industrial Park Investment Ltd. | Shenzhen | Shenzhen | RMB 58 million | Management consulting | - | 100.00% | By new establishment |
| Shenzhen S. F. Airport Investment Co., Ltd. | Shenzhen | Shenzhen | RMB 100 million | Industrial investment | - | 100.00% | By new establishment |
| SF Holding Limited | Hong Kong | Hong Kong | HKD 2,260,010,000 | Investment holding | - | 100.00% | Business combination involving enterprises under common control |
| Group Finance Company | Shenzhen | Shenzhen | RMB 1,000 million | Financing, wealth management and consulting services | - | 100.00% | By new establishment |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
6 Interests in other entities (Cont’d)
(1) Interests in subsidiaries (Cont’d)
(a) First-tier and second-tier subsidiaries of the Group are as follows (Cont’d):
| Shareholding (%) | |||||||
| Place of registration | Major business location | Registered capital | Nature of business | Direct | Indirect | Method of acquisition | |
| Shenzhen SF Chuangxing Investment Co., Ltd. | Shenzhen | Shenzhen | RMB 150 million | Industrial investment | - | 100.00% | By new establishment |
| Shenzhen Fengnong Technology Co., Ltd. | Shenzhen | Shenzhen | RMB 15 million | Retail | - | 100.00% | By new establishment |
| Shenzhen Fenglang Supply Chain Co., Ltd. | Shenzhen | Shenzhen | RMB 30 million | Supply chain management and other services | - | 100.00% | By new establishment |
| Shenzhen Shunfeng Runtai Management Consulting Co., Ltd. | Shenzhen | Shenzhen | RMB 5 million | Consulting service | - | 100.00% | By new establishment |
| Shunyuan Financial Leasing (Tianjin) Co., Ltd. | Tianjin | Tianjin | RMB 370 million | Leasing business | - | 100.00% | By new establishment |
| SF Multimodal Co., Ltd. | Shenzhen | Shenzhen | RMB 242 million | Goods delivery services | - | 100.00% | By new establishment |
| Shenzhen Shunxi Management Consulting Co., Ltd. | Shenzhen | Shenzhen | RMB 2 million | Management consulting | - | 100.00% | By new establishment |
| S.F. Insurance Broker (Shenzhen) Co., Ltd. | Shenzhen | Shenzhen | RMB 50 million | Insurance business | - | 100.00% | By new establishment |
| S.F. Duolian Technology Co., Ltd. | Dongguan | Dongguan | RMB 150 million | Technology development | - | 100.00% | By new establishment |
| Dongguan SF Taisen Enterprise Management Co., Ltd. | Dongguan | Dongguan | RMB 30 million | Property management | - | 100.00% | By new establishment |
| SF Innovative Technology Co., Ltd. | Dongguan | Dongguan | RMB 450 million | Information technology service | - | 100.00% | By new establishment |
| Rongyilian Technology (Shenzhen) Co., Ltd. | Shenzhen | Shenzhen | RMB 50 million | Research and development, development and sales of systems | - | 100.00% | By new establishment |
| Shenzhen Shunheng Rongfeng Supply Chain Technology Co., Ltd. | Shenzhen | Shenzhen | RMB 100 million | Consulting service | - | 100.00% | Business combination involving enterprises under common control |
| Shenzhen Hengyi Logistics Service Co., Ltd. | Shenzhen | Shenzhen | RMB 100 million | Freight forwarding service | - | 100.00% | Business combination involving enterprises under common control |
| Lefeng Factoring | Shenzhen | Shenzhen | RMB 50 million | Factoring | - | 100.00% | Business combination involving enterprises under common control |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
6 Interests in other entities (Cont’d)
(1) Interests in subsidiaries (Cont’d)
(a) First-tier and second-tier subsidiaries of the Group are as follows (Cont’d):
| Shareholding (%) | |||||||
| Place of registration | Major business location | Registered capital | Nature of business | Direct | Indirect | Method of acquisition | |
| Hangzhou SF Intra-city Industrial Co., Ltd. | Hangzhou | Hangzhou | RMB 666.63 million | Supply chain management and other services | - | 88.00% | By new establishment |
| SF Intra-city Holdings Limited | Hangzhou | Hangzhou | RMB 425.00 million | Supply chain management and other services | - | 96.63% | By new establishment |
| Shenzhen SF Express Zhongyuan Network Technology Co., Ltd. | Shenzhen | Shenzhen | RMB 10 million | Technology development and consulting services | - | 100.00% | By new establishment |
| SF Sharing Precision Information Technology (Shenzhen) Co., Ltd. | Shenzhen | Shenzhen | RMB 30 million | Information technology service | - | 100.00% | By new establishment |
| Hangzhou Shuangjie Supply Chain Co., Ltd. | Hangzhou | Hangzhou | RMB 50 million | Supply chain management and other services | - | 100.00% | By new establishment |
| S.F. Express | Shenzhen | Shenzhen | RMB 1,080.00 million | Supply chain management and other services | - | 100.00% | By new establishment |
| Huanggang Xiufeng Education Investment Co., Ltd. | Huanggang | Huanggang | RMB 90 million | Consulting services regarding business information and business management | - | 100.00% | By new establishment |
| Junhe Information Technology (Shenzhen) Co., Ltd. | Shenzhen | Shenzhen | RMB 10 million | Information technology and development services | - | 100.00% | By new establishment |
| Runxianghe Human Resources Service (Wuhan) Co., Ltd. | Wuhan | Wuhan | RMB 5 million | HR services | - | 100.00% | By new establishment |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
6 Interests in other entities (Cont’d)
(1) Interests in subsidiaries (Cont’d)
(b) Subsidiaries in which the Group has significant minority interests
As at 30 June 2020 and 31 December 2019, minority interests of the Group’s subsidiaries had nosignificant influence on the Group.
(2) Interests in joint ventures and associates
(a) The Group’s associates have no significant influence on the Group and are summarised as follows:
| Ending balance/ | Opening balance/ | ||
| Amount in the current period | Amount in the prior period | ||
| Aggregated carrying amount of investments (Note 4(13)(b)) | 882,494,833.00 | 880,449,618.04 | |
| Aggregation of the following items in proportion: | |||
| Net loss | (20,352,940.06) | (43,797,771.14) | |
| Other comprehensive income | 873,013.64 | (1,956,923.83) | |
| Total comprehensive income | (19,479,926.42) | (45,754,694.97) |
As at 30 June 2020, an investment loss of RMB 2,188,052.26 (for the six months ended 30 June2019: RMB 4,895,575.74) was unrecognised by the Group in the financial statements for the currentperiod because the carrying amount of long-term equity investments in investees was written downto RMB 0.
(b) The Group’s joint ventures have no significant influence on the Group and are summarised as
follows:
| Ending balance/ | Opening balance/ | ||
| Amount in the current period | Amount in the prior period | ||
| Aggregated carrying amount of investments (Note 4(13)(a)) | 1,343,939,529.47 | 1,341,063,055.10 | |
| Aggregation of the following items in proportion: | |||
| Net profit/(loss) | 1,905,420.29 | (7,187,638.39) | |
| Other comprehensive income | - | 842,393.75 | |
| Total comprehensive income | 1,905,420.29 | (6,345,244.64) |
As at 30 June 2020, an investment loss of RMB 2,015,788.71 (for the six months ended 30 June2019: None) was unrecognised by the Group in the financial statements for the current periodbecause the carrying amount of long-term equity investments in investees was written down to RMB0.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
7 Segment information
The segment information is not presented any more since the Group mainly provides expressdelivery and supply chain service and there is only one major business segment.
8 Related parties and related party transactions
(1) General information of the controlling shareholder and subsidiaries
The general information and other related information of the subsidiaries are set out in Note 6(1).
(a) General information of the controlling shareholder
| Place of registration | Nature of business | |
| Mingde Holdings | Shenzhen | Investment |
The Company’s ultimate holding company is Mingde Holdings, and the ultimate controlling person isWang Wei.
(b) The balances and changes of registered capital of the controlling shareholder
| 31 December 2019 | Increase in the current period | Decrease in the current period | 30 June 2020 | ||||
| Mingde Holdings | 113,405,734.21 | - | - | 113,405,734.21 |
(c) The percentages of shareholding and voting rights in the Company held by the controlling
shareholder
| 30 June 2020 | 31 December 2019 | ||||||
| Shareholding (%) | Voting rights (%) | Shareholding (%) | Voting rights (%) | ||||
| Mingde Holdings | 60.74% | 60.74% | 61.20% | 61.20% | |||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
8 Related parties and related party transactions (Cont’d)
(2) Nature of related parties that do not control/are not controlled by the Company
Major related parties are listed as follows:
| Relationship with the Company in the reporting period | |
| Fengyi TechnologyNote 1 | Controlled by the ultimate controlling person of the Company |
| S. F. Holding (Group) Commerce Co., Ltd. Note 2 | Controlled by the ultimate controlling person of the Company |
| Zhuhai Shunxiaofeng Commercial Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Zhongshan Shunxiaofeng Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Huizhou S.F. Commercial Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Jiangmen Shunyifeng Commercial Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Jiangsu Shunxiaofeng Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Suzhou Industrial Park Shunhengshun Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Zhenjiang S.F. Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Taizhou Shunjiefeng Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Yancheng Shunxiaofeng Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Zhejiang S.F. Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Ningbo Shunxiaofeng Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Shenzhen Shunshang Investment Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Shenzhen S.F. Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Foshan Shunxiaofeng Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Dalian S.F. Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Shandong Shunxiaofeng Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Qingdao Shunyifeng Commercial Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Beijing Shunxiaofeng Commercial Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Shanghai S.F. Industrial Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Jiangxi Shunxiaofeng Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Tianjin Shunfengshun Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Inner Mongolia S.F. Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Shanxi Shunxiaofeng Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Jilin S.F. Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Guangxi Shunyifeng Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Hainan S.F. Commercial Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Shanxi Shunyifeng Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Hunan Shunyifeng Commercial Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Hubei Shunyifeng Commercial Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Henan Shunyifeng Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Gansu S.F. Commercial Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Hebei Shunxiaofeng Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Fujian Shunyifeng Commercial Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Zhaoqing Shunyifeng Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Dongguan S.F. Commercial Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Shenzhen S.F. Electronic Commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Beijing S.F. E-commerce Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| S. F. You Xuan International Co., Ltd.Note 2 | Controlled by the ultimate controlling person of the Company |
| Suzhou Fengchengda Network Technology Co., Ltd. | Controlled by the ultimate controlling person of the Company |
| Shenzhen S.F. Hefeng Microfinance Co., Ltd. | Controlled by the ultimate controlling person of the Company |
| Mingde Investment | Controlled by the ultimate controlling person of the Company |
| Hangzhou Fengtai E-Commerce Industrial Park Management Ltd. | Controlled by the ultimate controlling person of the Company |
| Mingde Holdings | Controlled by the ultimate controlling person of the Company |
| Hive Box Technology | Held by the ultimate holding company |
| Chongqing Boqiang Logistics Co., Ltd. | The Group’s associate |
| Kin Shun Information Technology Limited | The Group’s associate |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
8 Related parties and related party transactions (Cont’d)
(2) Nature of related parties that do not control/are not controlled by the Company (Cont’d)
| Relationship with the Company in the reporting period | |
| Shanghai Qianqu Network Technology Co., Ltd. (“Qianqu Network”) and its subsidiaries | The Group’s associate |
| Shenzhen Zhongwang Finance and Tax Management Co., Ltd. | The Group’s associate |
| Shenzhen Shunjie Fengda. | The Group’s associate |
| SF Lottery (Shenzhen) Technology Development Co., Ltd. (“SF Lottery”)Note 3 | The Group’s associate before 31 December 2019 |
| Little Red Hat and its subsidiaries | The Group’s associate |
| Hubei Jiuzhou Tongda Technology Development Co., Ltd. | The Group’s associate |
| Shenzhen Zhi Hang UAV Co., Ltd. | The Group’s associate |
| Xi’an Huahan Air Passenger and Freight Service Co., Ltd. | The Group’s associate |
| Qingdao Dakai Cargo Agency Co., Ltd. | The Group’s associate |
| Beijing Dazhangfang and its subsidiaries | The Group’s associate |
| Canbeidou Supply Chain and its subsidiaries | The Group’s associate |
| Wuhan Shunluo Supply Chain Management Co., Ltd.Note 4 | The Group’s associate |
| DHL Weiheng (Zhuhai) Supply Chain Management Co., Ltd. | The Group’s associate |
| Shenghai Information | The Group’s joint venture |
| POST11O? | The Group’s joint venture |
| ZBHA and its subsidiaries | The Group’s joint venture |
| CR-SF International Express Co., Ltd. | The Group’s joint venture |
| Wenzhou Fengbaoke Technology Co., Ltd. | The Group’s joint venture |
| Zhongyunda Aviation Ground Services Co., Ltd. | The Group’s joint venture |
| Geling Information and its subsidiaries | The Group’s joint venture |
| Global Connect Holding Limited | The Group’s joint venture |
| Wulian Shuntong and its subsidiaries | The Group’s joint venture |
| Beijing Shunhetongxin Technology Co., Ltd. | The Group’s joint venture |
| Guangzhou Leshou Network Technologies Co., Ltd. (“Leshou Network”)Note 5 | The Group’s joint venture before 31 December 2019 |
| Ping An Insurance (Group) Company of China Co., Ltd. (“Ping An Insurance”) and its subsidiaries Note 6 | Significantly influenced by the key management of the Company before July 2019 |
| China Pacific Insurance (Group) Co., Ltd. (“Pacific Insurance”) and its subsidiaries Note 6 | Significantly influenced by the key management of the Company before July 2019 |
| CITIC Securities Co., Ltd. (“CITIC Securities”) and its subsidiaries | Significantly influenced by the key management of the Company |
| Golden Arches (China) Co., Ltd. ("Golden Arches") | Significantly influenced by the key management of the Company |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
8 Related parties and related party transactions (Cont’d)
(2) Nature of related parties that do not control/are not controlled by the Company (Cont’d)
| Relationship with the Company in the reporting period | |
| Shenzhen Qianhai Webank Co., Ltd. | Significantly influenced by the key management of the Company |
| Shenzhen Henglu Logistics Co., Ltd. Note 7 | Significantly influenced by the key management of the Company before September 2018 |
| Zhiye Enterprise Co., Ltd. | Significantly influenced by close family members of the ultimate controlling person |
| SF Charity Foundation | Organisation sponsored by controlling shareholders and the Company’s subsidiaries, in which director and supervisor of the company serve on the Board of Management |
| Suzhou Ruihuang Equity Investment Management Limited Partnership | Another company in which a director of the Group acts as managing partner |
Note 1: It was a subsidiary of the Group. The Group lost actual control over Fengyi Technology since 1 June
2019 and ceased to include it in the consolidation scope. Therefore, Fengyi Technology became theGroup's related party since 1 June 2019. The related party transactions with Fengyi Technology forthe six months ended 30 June 2019 disclosed in the financial statements refer to the transactionvolumes made in June 2019.
Note 2: They are S.F. Holding (Group) Commerce Co., Ltd. and its subsidiaries, which are referred as
“Commerce Holding and its subsidiaries”.
Note 3: It was an associate disposed by the Group in 2019, so its transactions with the Group during the
period from January to June 2020 and balance as at 30 June 2020 are presented as “Notapplicable”.
Note 4: It was a new associate of the Group in December 2019, so its transactions with the Group during the
period from January to June 2019 are presented as “Not applicable”.
Note 5: It was a joint venture disposed of by the Group in 2019, so its transactions with the Group during the
period from January to June 2020 and balance as at 30 June 2020 are presented as “Notapplicable”.
Note 6: It was a company significantly influenced by the key management of the Group before July 2019.
Pursuant to the Listing Rules of Shenzhen Stock Exchange, it was the Group’s related party as at 30June 2020.
Note 7: It was a company significantly influenced by the key management of the Group before September
2018. Pursuant to the Listing Rules of Shenzhen Stock Exchange, Shenzhen Henglu Logistics Co.,Ltd. was no longer a related party of the Group since September 2019, so its related partytransactions with the Group during the period from January to June 2020 are presented as “Notapplicable”.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
8 Related parties and related party transactions (Cont’d)
(3) Related party transactions
(a) Pricing policies
The pricing method of transactions and transaction price between the Group and related parties aredetermined, following arm’s length principle, by making reference to the market price or throughnegotiation between both parties.
(b) Income from courier service, combined transport and freight forwarding services
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| McDonald’s and its subsidiaries | 549,826,934.82 | 552,358,228.73 | |
| Ping An Insurance and its subsidiaries | 56,372,650.09 | 49,226,861.66 | |
| CR-SF International Express Co., Ltd. | 30,684,995.23 | - | |
| Commerce Holding and its subsidiaries | 21,087,072.32 | 56,252,063.81 | |
| SF Charity Foundation | 16,656,918.94 | - | |
| Fengyi Technology | 13,789,903.01 | 1,573,912.41 | |
| Pacific Insurance and its subsidiaries | 11,325,878.60 | 12,548,160.80 | |
| CITIC Securities and its subsidiaries | 1,749,086.07 | 1,358,208.06 | |
| Suzhou Fengchengda Network Technology Co., Ltd. | 1,314,952.65 | 3,530,601.86 | |
| Hive Box Technology | 893,147.41 | 477,742.58 | |
| Wenzhou Fengbaoke Technology Co., Ltd. | 837,218.83 | 74,532.03 | |
| Geling Information and its subsidiaries | 566,861.00 | - | |
| Zhongyunda Aviation Ground Services Co., Ltd. | 238,702.94 | 18,742,561.01 | |
| Shenzhen Henglu Logistics Co., Ltd. | Not applicable | 1,076,516.85 | |
| Others | 3,095,070.72 | 1,729,249.09 | |
| 708,439,392.63 | 698,948,638.89 | ||
(c) Communication income
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Hive Box Technology | 10,540,933.95 | 12,407,113.50 | |
| Fengyi Technology | 1,480,366.98 | 328,502.74 | |
| Shenzhen S.F. Hefeng Microfinance Co., Ltd. | 809,538.64 | 316,958.80 | |
| 12,830,839.57 | 13,052,575.04 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
8 Related parties and related party transactions (Cont’d)
(3) Related party transactions (Cont’d)
(d) Commission income for collection and settlement on behalf of related parties
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Shenzhen S.F. Hefeng Microfinance Co., Ltd. | 2,361,931.14 | 2,306,831.36 | |
| Others | 117,618.69 | 213,727.14 | |
| 2,479,549.83 | 2,520,558.50 | ||
(e) Income from platform and other services
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Fengyi Technology | 5,236,762.32 | 877,253.67 | |
| CR-SF International Express Co., Ltd. | 3,737,098.33 | - | |
| SF Lottery | Not applicable | 102,242.61 | |
| Others | 510,730.15 | 247,622.97 | |
| 9,484,590.80 | 1,227,119.25 | ||
(f) Technology development service income
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Commerce Holding and its subsidiaries | - | 1,386,459.91 | |
| Others | 498,435.44 | - | |
| 498,435.44 | 1,386,459.91 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
8 Related parties and related party transactions (Cont’d)
(3) Related party transactions (Cont’d)
(g) Revenue from rent and property management
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Fengyi Technology | 885,781.70 | 144,705.04 | |
| Hangzhou Fengtai E-Commerce Industrial Park Management Ltd. | 511,585.06 | 284,915.26 | |
| Commerce Holding and its subsidiaries | - | 531,933.13 | |
| Others | 717,532.68 | 515,379.84 | |
| 2,114,899.44 | 1,476,933.27 | ||
(h) Revenue from sales of goods
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Shenzhen Shunjie Fengda | 7,813,123.87 | - | |
| Hive Box Technology | 3,488,105.88 | - | |
| Others | 253,909.31 | - | |
| 11,555,139.06 | - | ||
(i) Interest income
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Wuhan Shunluo Supply Chain Management Co., Ltd. | 321,986.83 | Not applicable | |
| DHL Weiheng (Zhuhai) Supply Chain Management Co., Ltd. | 317,036.15 | - | |
| Kin Shun Information Technology Limited | 81,073.63 | - | |
| 720,096.61 | - | ||
(j) Sales of equity
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Mingde Holdings | - | 135,000,000.00 | |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
8 Related parties and related party transactions (Cont’d)
(3) Related party transactions (Cont’d)
(k) Combined transport and freight forwarding expenses
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| CR-SF International Express Co., Ltd. | 191,128,674.20 | 80,777,966.02 | |
| Shenzhen Shunjie Fengda | 96,126,152.00 | 65,885,668.41 | |
| Kin Shun Information Technology Limited | 63,050,647.89 | 11,335,714.80 | |
| Wulian Shuntong and its subsidiaries | 41,165,451.85 | 4,582,295.35 | |
| POST11O? | 18,348,348.24 | 33,923,159.79 | |
| Qingdao Dakai Cargo Agency Co., Ltd. | 13,907,375.89 | 11,254,210.89 | |
| Xi’an Huahan Air Passenger and Freight Service Co., Ltd. | 11,108,419.89 | 9,021,788.33 | |
| Zhongyunda Aviation Ground Services Co., Ltd. | 5,470,688.84 | 11,072,794.55 | |
| Chongqing Boqiang Logistics Co., Ltd. | 4,040,564.96 | 6,467,064.68 | |
| Little Red Hat and its subsidiaries | 3,459,587.20 | 5,582,879.06 | |
| Others | 371,846.29 | - | |
| 448,177,757.25 | 239,903,541.88 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
8 Related parties and related party transactions (Cont’d)
(3) Related party transactions (Cont’d)
(l) Express delivery agent and other service fees
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Hive Box Technology | 41,693,321.90 | 10,158,052.14 | |
| Beijing Dazhangfang and its subsidiaries | 2,138,162.91 | - | |
| Commerce Holding and its subsidiaries | 1,684,942.72 | 2,595,990.29 | |
| Global Connect Holding Limited | 1,479,642.95 | 510,519.23 | |
| Shenzhen Zhongwang Finance and Tax Management Co., Ltd. | 1,352,984.67 | - | |
| Others | - | 330,530.72 | |
| 48,349,055.15 | 13,595,092.38 | ||
(m) Interest expenses
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Shenzhen Zhongwang Finance and Tax Management Co., Ltd. | 45,109.62 | - | |
| Others | 375.91 | - | |
| 45,485.53 | - | ||
(n) Collection commissions fee
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Hive Box Technology | 60,944,717.00 | 38,292,379.47 | |
(o) Security service fee
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| ZBHA and its subsidiaries | 76,196,898.98 | 57,702,536.53 | |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
8 Related parties and related party transactions (Cont’d)
(3) Related party transactions (Cont’d)
(p) Rent and property management fees
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Commerce Holding and its subsidiaries | 23,392,845.68 | - | |
| Shenghai Information | 5,938,741.66 | 9,266,275.07 | |
| Canbeidou Supply Chain and its subsidiaries | 2,020,087.78 | 1,699,556.69 | |
| Beijing Dazhangfang and its subsidiaries | 4,153,106.44 | - | |
| Others | 418,511.36 | 155,909.70 | |
| 35,923,292.92 | 11,121,741.46 | ||
(q) Technology development and operation & maintenance service fee
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Shenghai Information | 14,266,853.37 | 14,216,580.06 | |
| Beijing Shunhetongxin Technology Co., Ltd. | 2,853,845.58 | 1,328,216.32 | |
| Shenzhen Zhi Hang UAV Co., Ltd. | 231,900.20 | 342,676.74 | |
| 17,352,599.15 | 15,887,473.12 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
8 Related parties and related party transactions (Cont’d)
(3) Related party transactions (Cont’d)
(r) Promotion fee
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Commerce Holding and its subsidiaries | 306,314.75 | 5,138,819.77 | |
| Others | 144,091.99 | 416,405.02 | |
| 450,406.74 | 5,555,224.79 | ||
(s) Purchase of materials
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Hubei Jiuzhou Tongda Technology Development Co., Ltd. | 114,605,000.79 | 92,406,868.08 | |
| Fengyi Technology | 110,164,700.38 | 73,636.83 | |
| Commerce Holding and its subsidiaries | 43,975,730.70 | 41,772,747.36 | |
| Wenzhou Fengbaoke Technology Co., Ltd. | 15,714,549.49 | 6,823,613.26 | |
| Shenghai Information | 19,055.01 | 579,897.05 | |
| 284,479,036.37 | 141,656,762.58 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
8 Related parties and related party transactions (Cont’d)
(3) Related party transactions (Cont’d)
(t) Insurance premium
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Pacific Insurance and its subsidiaries | 36,409,014.15 | 45,062,064.16 | |
| Ping An Insurance and its subsidiaries | 15,821,191.55 | 2,111,341.83 | |
| 52,230,205.70 | 47,173,405.99 | ||
Insurance premium represents the amount amortised over the benefit period of insurance policies.
(u) Donation expenses
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| SF Charity Foundation | 20,000,000.00 | 1,000,000.00 | |
(v) Remuneration of key management
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Remuneration of key management | 16,980,000.00 | 34,260,000.00 | |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
8 Related parties and related party transactions (Cont’d)
(4) Receivables from and payables to related parties
(a) Accounts receivable
| 30 June 2020 | 31 December 2019 | ||
| McDonald’s and its subsidiaries | 134,420,162.80 | 148,822,448.84 | |
| CR-SF International Express Co., Ltd. | 25,431,067.35 | 10,490,672.84 | |
| Fengyi Technology | 22,562,224.87 | 20,394,717.59 | |
| Ping An Insurance and its subsidiaries | 11,341,219.59 | 14,293,115.93 | |
| Shenzhen Shunjie Fengda | 8,836,588.38 | - | |
| Commerce Holding and its subsidiaries | 7,902,408.66 | 20,238,017.63 | |
| Hive Box Technology | 6,317,715.85 | 784,860.38 | |
| Zhongyunda Aviation Ground Services Co., Ltd. | 4,083,371.81 | 4,077,129.23 | |
| Pacific Insurance and its subsidiaries | 1,867,960.03 | 5,432,033.59 | |
| Suzhou Fengchengda Network Technology Co., Ltd. | 1,113,781.63 | 1,489,069.64 | |
| Kin Shun Information Technology Limited | 988,758.04 | 551,749.80 | |
| Shenzhen S.F. Hefeng Microfinance Co., Ltd. | 778,121.70 | 702,659.05 | |
| Wenzhou Fengbaoke Technology Co., Ltd. | 732,481.00 | 1,108,935.00 | |
| Mingde Holdings | 13,439.85 | 900,666.60 | |
| Others | 2,041,890.85 | 2,144,864.74 | |
| 228,431,192.41 | 231,430,940.86 |
(b) Advances to suppliers
| 30 June 2020 | 31 December 2019 | ||
| Hive Box Technology | 44,668,555.59 | 26,709,547.43 | |
| CR-SF International Express Co., Ltd. | 11,961,253.90 | 10,123,755.55 | |
| Pacific Insurance and its subsidiaries | 11,292,479.00 | 32,753,736.15 | |
| Beijing Dazhangfang and its subsidiaries | 2,588,869.39 | 3,133,950.68 | |
| Shenzhen Zhongwang Finance and Tax Management Co., Ltd. | 1,568,360.16 | 533,715.17 | |
| Ping An Insurance and its subsidiaries | 531,696.04 | 919,101.65 | |
| Leshou Network and its subsidiaries | Not applicable | 500,000.00 | |
| Others | 1,041,371.27 | 719,567.14 | |
| 73,652,585.35 | 75,393,373.77 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
8 Related parties and related party transactions (Cont’d)
(4) Receivables from and payables to related parties (Cont’d)
(c) Loans and advances
| 30 June 2020 | 31 December 2019 | ||
| DHL Weiheng (Zhuhai) Supply Chain Management Co., Ltd. | 34,347,638.89 | - | |
| Wuhan Shunluo Supply Chain Management Co., Ltd. | 13,897,248.64 | - | |
| Kin Shun Information Technology Limited | 5,608,135.03 | - | |
| 53,853,022.56 | - |
(d) Other receivables
| 30 June 2020 | 31 December 2019 | ||
| Hive Box Technology | 247,135,969.89 | 237,357,559.02 | |
| McDonald’s and its subsidiaries | 31,103,056.05 | 36,592,188.91 | |
| Ping An Insurance and its subsidiaries | 7,137,983.01 | 5,868,998.93 | |
| Commerce Holding and its subsidiaries | 3,522,965.58 | 3,361,587.61 | |
| Kin Shun Information Technology Limited | 2,454,749.05 | 2,101,888.05 | |
| Pacific Insurance and its subsidiaries | 2,095,636.10 | 64,871.11 | |
| Beijing Dazhangfang and its subsidiaries | 1,989,724.03 | 7,919,259.83 | |
| Others | 649,726.53 | 937,930.12 | |
| 296,089,810.24 | 294,204,283.58 |
(e) Other non-current assets
| 30 June 2020 | 31 December 2019 | ||
| Hubei Jiuzhou Tongda Technology Development Co., Ltd. | 1,586,354.88 | - | |
| Shenghai Information | 207,370.50 | - | |
| 1,793,725.38 | - |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
8 Related parties and related party transactions (Cont’d)
(4) Receivables from and payables to related parties (Cont’d)
(f) Deposits from customers
| 30 June 2020 | 31 December 2019 | ||
| Shenzhen Zhongwang Finance and Tax Management Co., Ltd. | 5,164,492.27 | 3,778,707.92 | |
| Others | 375.91 | - | |
| 5,164,868.18 | 3,778,707.92 |
(g) Accounts payable
| 30 June 2020 | 31 December 2019 | ||
| CR-SF International Express Co., Ltd. | 71,493,793.46 | 55,309,253.45 | |
| Hubei Jiuzhou Tongda Technology Development Co., Ltd. | 31,800,590.71 | 15,173,062.43 | |
| Wulian Shuntong and its subsidiaries | 30,019,463.16 | 22,789,086.87 | |
| Shenzhen Shunjie Fengda | 27,246,320.95 | 22,175,003.97 | |
| Commerce Holding and its subsidiaries | 19,431,154.38 | 13,653,370.47 | |
| Hive Box Technology | 15,976,725.41 | 6,088,200.10 | |
| Fengyi Technology | 15,574,259.77 | 16,346,318.11 | |
| Wenzhou Fengbaoke Technology Co., Ltd. | 13,829,752.22 | 10,151,946.46 | |
| Ping An Insurance and its subsidiaries | 10,387,953.83 | 101,738.80 | |
| ZBHA and its subsidiaries | 9,818,844.10 | 11,793,545.33 | |
| Shenghai Information | 7,817,571.87 | 5,910,649.64 | |
| Pacific Insurance and its subsidiaries | 6,793,646.95 | 17,670,710.48 | |
| Xi’an Huahan Air Passenger and Freight Service Co., Ltd. | 3,645,881.79 | 3,015,475.32 | |
| Qingdao Dakai Cargo Agency Co., Ltd. | 3,329,766.72 | 2,366,749.33 | |
| POST11O? | 2,983,300.22 | 18,256,861.71 | |
| Beijing Dazhangfang and its subsidiaries | 1,907,719.48 | 3,066,989.00 | |
| Beijing Shunhetongxin Technology Co., Ltd. | 1,774,154.49 | 2,299,515.96 | |
| Zhongyunda Aviation Ground Services Co., Ltd. | 1,202,066.73 | 2,843,434.73 | |
| Canbeidou Supply Chain and its subsidiaries | 649,492.42 | 3,394,554.90 | |
| Kin Shun Information Technology Limited | - | 2,313,127.99 | |
| Others | 1,149,482.28 | 1,244,380.38 | |
| 276,831,940.94 | 235,963,975.43 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
8 Related parties and related party transactions (Cont’d)
(4) Receivables from and payables to related parties (Cont’d)
(h) Advances from customers
| 30 June 2020 | 31 December 2019 | ||
| Kin Shun Information Technology Limited | 859,774.94 | - | |
| McDonald’s and its subsidiaries | - | 28,345,182.30 | |
| Commerce Holding and its subsidiaries | - | 3,286,804.02 | |
| Fengyi Technology | - | 912,733.08 | |
| Ping An Insurance and its subsidiaries | - | 538,781.51 | |
| Others | - | 741,756.19 | |
| 859,774.94 | 33,825,257.10 |
(i) Contract liabilities
| 30 June 2020 | 31 December 2019 | ||
| McDonald’s and its subsidiaries | 8,969,450.57 | -- | |
| Pacific Insurance and its subsidiaries | 2,702,097.44 | -- | |
| Fengyi Technology | 2,603,536.94 | -- | |
| Ping An Insurance and its subsidiaries | 2,340,885.67 | -- | |
| Shenzhen Shunjie Fengda | 733,843.00 | -- | |
| Others | 667,198.56 | -- | |
| 18,017,012.18 | -- |
(j) Other payables
| 30 June 2020 | 31 December 2019 | ||
| Hubei Jiuzhou Tongda Technology Development Co., Ltd. | 13,733,331.39 | 11,558,007.28 | |
| Ping An Insurance and its subsidiaries | 12,481,368.78 | 492,024.74 | |
| Hive Box Technology | 2,242,192.95 | 217,000.00 | |
| Pacific Insurance and its subsidiaries | 1,151,013.42 | 430,366.74 | |
| Fengyi Technology | 800,281.76 | 793,117.19 | |
| Shenzhen S.F. Hefeng Microfinance Co., Ltd. | 586,188.36 | 452,035.81 | |
| Qianqu Network and its subsidiaries | 193,655.50 | 897,104.92 | |
| Kin Shun Information Technology Limited | 182,124.03 | 1,603,423.64 | |
| McDonald’s and its subsidiaries | 54,316.19 | 10,839,555.86 | |
| Zhongyunda Aviation Ground Services Co., Ltd. | - | 1,434,872.00 | |
| Others | 945,203.48 | 1,425,068.19 | |
| 32,369,675.86 | 30,142,576.37 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
9 Share-based payment
(1) Overview of share-based payment
| 30 June 2020 | |
| Total restricted shares granted at the beginning of the period | 2,456,568.00 |
| Total restricted shares repurchased in the current period | (2,456,568.00) |
| The exercise price of outstanding restricted shares at the end of the period and residual life of the restricted shares contracts | - |
Expenses recognised for the period arising from share-based payment were as follows:
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Equity-settled share-based payment | 54,253,366.54 | 15,597,712.81 | |
| Cash-settled share-based payment | 25,351,380.63 | 17,652,804.63 | |
| 79,604,747.17 | 33,250,517.44 | ||
(2) Information on equity-settled share-based payment
(a) Information on share-based payment of the Company
On 30 November 2017, the Company held the 4th interim shareholders’ meeting in 2017, at whichthe proposal of the Restricted Shares Incentive Plan (Draft) and Summary for 2017 was approved.Authorised by the 4th interim shareholders’ meeting in 2017, the Company held the 11th meeting ofthe 4th Board of Directors on 27 December 2017, at which the Proposal of Granting RestrictedShares to Incentive Recipients was approved. The restricted shares were granted on 27 December2017 and entitled the holders to purchase restricted shares at a price of RMB 29.32 per share,which was 50% of RMB 58.63, the average share price on the prior trading day (total transactionamount on the prior trading day/total transaction volume on the prior trading day) before theRestricted Shares Incentive Plan (Draft) of S.F. Holding Co., Ltd. for 2017 was released. TheCompany’s Board of Directors was authorised to grant 802 qualified employees restricted ordinary Ashares with a total number of 2,705,400 shares at a consideration of RMB 29.32 per share,accounting for about 0.06% of S.F. Holding’s total shares, which totalled 4,411,015,500 shares uponannouncement of the incentive plan.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
9 Share-based payment (Cont'd)
(2) Information on equity-settled share-based payment (Cont'd)
(a) Information on share-based payment of the Company (Cont'd)
On 17 May 2018, the Company held the 2nd interim shareholders’ meeting in 2018, at which theproposal of the Restricted Shares Incentive Plan (Draft) and Summary for 2018 was approved.Authorised by the 2nd interim shareholders’ meeting in 2018, the Company held the 15th meeting ofthe 4th Board of Directors on 13 June 2018, at which the Proposal of Granting Restricted Shares toIncentive Recipients for 2018 was approved. The restricted shares were granted on 13 June 2018and entitled the holders to purchase restricted shares at a price of RMB 24.33 per share, which was50% of RMB 48.65, the average share price on the prior 20 trading days (total transaction amounton the prior 20 trading days/total transaction volume on the prior 20 trading days) before theRestricted Shares Incentive Plan (Draft) of S.F. Holding Co., Ltd. for 2018 was released. TheGroup’s Board of Directors was authorised to grant 1,181 qualified employees restricted ordinary Ashares with a total number of 5,421,900 shares at a consideration of RMB 24.33 per share,accounting for about 0.12% of the Company’s total shares, which totalled 4,413,572,200 sharesupon announcement of the incentive plan.
The post lock-up periods and their schedules for the restricted shares for 2017 and 2018 arepresented in the table below:
| Post lock-up period | Timing | Proportion of shares exercisable |
| 1st post lock-up period | From the first trading day after 12 months since the registration of granting to the last trading day within 24 months after the registration of granting | 50.00% |
| 2nd post lock-up period | From the first trading day after 24 months since the registration of granting to the last trading day within 36 months after the registration of granting | 50.00% |
In addition to the Company’s performance, individual performance assessment, which is specified inthe Restricted Shares Incentive Plan, has also to be satisfied to unlock the restricted shares.
After it comes into the post lock-up period, the Group deals with unlocking procedures for theholders that meet unlocking conditions as well as repurchases and cancels the restricted sharesthat do not meet unlocking conditions. The repurchasing price comprises the granting price plus theinterest accruing thereon at the current deposit rate.
If the Company transfers capital reserve to paid-in capital, distributes share dividends, splits shares,pays dividends, allocates shares or reduces shares after restricted shares are granted, the numberand the price of repurchasing restricted shares shall be adjusted in accordance with the RestrictedShares Incentive Plan.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
9 Share-based payment (Cont'd)
(2) Information on equity-settled share-based payment (Cont'd)
(a) Information on share-based payment of the Company (Cont'd)
In 2017, the Group issued 2,556,661 ordinary A shares denominated in RMB according to therestricted shares incentive plan for 2017, with raised funds totalling RMB 74,961,331.87. On 9January 2018, the Company completed the granting and registration of the restricted sharesincentive plan for 2017.
In 2018, the Group issued 5,231,982 ordinary A shares denominated in RMB according to therestricted shares incentive plan for 2018, with raised funds totalling RMB 127,294,205.35. On 25June 2018, the Company completed the granting and registration of the restricted shares incentiveplan for 2018.
In 2019, the unlocking conditions for the first post lock-up period for the restricted shares incentiveplan for 2017 were met and 1,113,173 restricted shares were released.
As stated in Note 4(43), as at 30 June 2020, certain of the former incentive recipients resigned dueto personal reasons and did not meet the incentive conditions. Therefore, the Companyrepurchased and cancelled 751,841 restricted shares that had been granted but not yet releasedfrom restrictions.
As stated in Note 4(43), as at 30 June 2020, according to the Group’s performance in 2018 and2019, the unlocking conditions for the second post lock-up period for the restricted shares incentiveplan for 2017 and for the first and the second post lock-up period for the restricted shares incentiveplan for 2018 were not met; therefore, the Company repurchased and cancelled a total of 5,923,629restricted shares that had been granted but not yet released from restrictions.
As at 30 June 2020, the above incentive plan of the Company was fully implemented.
As at 30 June 2020, the equity-settled share-based payment recognised in the capital reserveaccumulated to RMB 23,632,662.79 (31 December 2019: RMB 23,632,662.79). For the six monthsended 30 June 2020, there was no expenses recognised for equity-settled share-based payment(expenses recognised for equity-settled share-based payment for the six months ended 30 June2019: RMB 11,681,356.03).
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
9 Share-based payment (Cont'd)
(2) Information on equity-settled share-based payment (Cont'd)
(b) Information on share-based payment of the Company’s subsidiaries
The Group granted some equities or share options of several subsidiaries, to the seniormanagement and other employees of the aforesaid companies or other subsidiaries within theGroup respectively.
As at 30 June 2020, the equity-settled share-based payments of the these companies recognisedby the Group accumulated to RMB 81,571,228.07 (31 December 2019: RMB 27,317,861.53),including accumulated amounts attributable to shareholders of the parent company of RMB70,558,921.55 (31 December 2019: RMB 23,378,510.00). For the six months ended 30 June 2020,expenses recognised for equity-settled share-based payment amounted to RMB 54,253,366.54 (forthe six months ended 30 June 2019: RMB 3,916,356.78).
(3) Information on cash-settled share-based payment
(a) Information on share-based payment of the Company
On 30 November 2017, the Company held the 4th interim shareholders’ meeting in 2017, at whichthe proposal of the Incentive Plan of Share Appreciation Rights (Draft) and Summary for 2017 wasapproved. Authorised by the 4th interim shareholders’ meeting in 2017, the Company held the 11thmeeting of the 4th Board of Directors on 27 December 2017, at which the Proposal of GrantingShare Appreciation Rights to Incentive Recipients was approved. The share appreciation rightswere granted on 27 December 2017. The exercise price of the share appreciation rights was RMB
29.32 per share. The incentive recipients of the plan refer to 20 key foreign talents.
On 17 May 2018, the Company held the 2nd interim shareholders’ meeting in 2018, at which theproposal of the Incentive Plan of Share Appreciation Rights (Draft) and Summary for 2018 wasapproved. Authorised by the 2nd interim shareholders’ meeting in 2018, the Company held the 15thmeeting of the 4th Board of Directors on 13 June 2018, at which the Proposal of Granting ShareAppreciation Rights to Incentive Recipients was approved. The share appreciation rights weregranted on 13 June 2018. The exercise price of the share appreciation rights was RMB 24.33 pershare. The incentive recipients of the plan refer to 29 key foreign talents.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
9 Share-based payment (Cont'd)
(3) Information on cash-settled share-based payment (Cont'd)
(a) Information on cash-settled share-based payment of the Company (Cont'd)
The exercise periods and their schedules for the share appreciation rights for 2017 and 2018 arepresented in the table below:
| Exercise period | Timing | Exercise proportion |
| 1st exercise period | From the first trading day after 12 months since the registration of granting to the last trading day within 24 months after the registration of granting | 50.00% |
| 2nd exercise period | From the first trading day after 24 months since the registration of granting to the last trading day within 36 months after the registration of granting | 50.00% |
In addition to the Company’s performance, individual performance assessment, which is specified inthe Incentive Plan of Share Appreciation Rights, has also to be satisfied for the share appreciationrights granted.
As at 30 June 2020, there were no liabilities arising from the cash-settled share-based payment (31December 2019: RMB 94,340.00). For the six months ended 30 June 2020, there was no expensesrecognised for cash-settled share-based payment (expenses recognised for cash-settledshare-based payment for the six months ended 30 June 2019: RMB 197,200.63).
(b) Information on share-based payment of the Company’s subsidiaries
The Group granted the senior management of subsidiaries with the equities or share options of thesubsidiaries with repurchase terms.
As at 30 June 2020, liabilities arising from the cash-settled share-based payment accumulated toRMB 96,307,166.54 (31 December 2019: RMB 70,955,785.90). For the six months ended 30 June2020, expenses recognised for cash-settled share-based payment in the current period amountedto RMB 25,351,380.63 (for the six months ended 30 June 2019: 17,455,604.00).
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
10 Commitments
(1) Capital commitments
Capital expenditures contracted for by the Group but are not yet necessary to be recognised on thebalance sheet as at the balance sheet date are as follows:
| 30 June 2020 | 31 December 2019 | ||
| Investment contracts that have been signed but not fulfilled or not absolutely fulfilled | |||
| 2,292,373,768.43 | 2,235,936,315.03 | ||
| Buildings, machinery and equipment | 3,701,446,485.41 | 2,499,921,937.09 | |
| Others | 809,642,633.83 | 36,618,770.00 | |
| 6,803,462,887.67 | 4,772,477,022.12 |
(2) Operating lease commitments
The future minimum lease payments due under the signed irrevocable operating leases contractsare summarised as follows:
| 30 June 2020 | 31 December 2019 | ||
| Within 1 year | 5,176,546,244.66 | 5,101,875,264.17 | |
| 1 to 2 years | 3,349,024,471.50 | 2,981,614,327.74 | |
| 2 to 3 years | 2,073,147,857.38 | 1,785,237,235.00 | |
| Over 3 years | 2,674,553,701.27 | 3,148,454,559.67 | |
| 13,273,272,274.81 | 13,017,181,386.58 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
10 Commitments (Cont'd)
(3) Other commitments
(i) In September 2019, the Group issued asset-backed securities through the Special Scheme set up
by Huatai Securities (Shanghai) Asset Management Co., Ltd. by using three logistics industrialparks held by it as underlying assets. Shenzhen Fengtai E-Commerce Industrial Park PropertyService Ltd., Yiwu Fengyutai Enterprise Management Co., Ltd. and Huai’an Fengtai EnterpriseManagement Co., Ltd. (collectively, “Property Operators”), wholly-owned subsidiaries of the Group,worked as the property operators of the Special Scheme. In case that the actual operating income ofthe property assets does not reach 90% but is not lower than 80% of the target amount, the PropertyOperators were committed to compensate the insufficient part of the target amount with TaisenHoldings providing guarantee for the compensation obligation.
At the end of each three years, the manager of the above Special Scheme accepts open-endedwithdrawal and subscription of preferred securities within the withdrawal registering period. If thepreferred securities shares that have not completed open-ended withdrawal are less than 20% oftotal undistributed principal of the preferred securities of RMB 765 million, at the extension operationannouncement date, Taisen Holdings will purchase such preferred securities.
(ii) In December 2018, the Group issued asset-backed securities through the Special Scheme set up by
Huatai Securities (Shanghai) Asset Management Co., Ltd. by using two logistics industrial parksheld by it as underlying assets. Shanghai Fengtai Yuanxing Property Management Service Co., Ltd.(“Fengtai Yuanxing”), a wholly-owned subsidiary of the Group, worked as the property operator ofthe special scheme. In case that the actual operating income of the property assets does not reach90% but is not lower than 80% of the target amount, Fengtai Yuanxing was committed tocompensate the insufficient part of the target amount with Taisen Holdings providing guarantee forthe compensation obligation.
At the end of each three years, the manager of the above Special Scheme accepts open-endedwithdrawal and subscription of preferred securities within the withdrawal registering period. If thepreferred securities shares that have not completed open-ended withdrawal are less than 20% oftotal undistributed principal of the preferred securities of RMB 1.12 billion, at the extension operationannouncement date, Taisen Holdings will purchase such preferred securities.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
11 Events after the balance sheet date
(1) Redemption of the Company's convertible corporate debentures
The convertible corporate debentures (Note 4(35)(d)) issued by the Company have triggered theconditional redemption clayse stipulated in the prospectus. Therefore, on 7 July 2020, the 7thmeeting of the 5th session of Board of Directors of the Company approved the Proposal on EarlyRedemption of "S.F. Convertible Corporate Debentures", and decided to exercise the right ofredemption of the convertible corporate debentures. As at the reporting date, the above convertiblecorporate debentures were converted into 144,311,758 ordinary A-shares of the Company. All theremaining unconverted debentures were fully redeemed by the Group on 3 August 2020 at the priceof the par value of the debentures plus accrued interest for the period.
12 Business combinations
Refer to Note 5(1).
13 Financial instrument and risk
The Group’s activities expose it to a variety of financial risks: market risk (primarily including foreignexchange risk, interest rate risk and other price risk), credit risk and liquidity risk. The abovefinancial risks and the Group’s risk management policies to mitigate the risks are as follows:
The Board of Directors is responsible for planning and establishing the Group’s risk managementframework, formulating the Group’s risk management policies and related guidelines, andsupervising the implementation of risk management measures. The Group has established riskmanagement policies to identify and analyse the risks faced by the Group. These risk managementpolicies specify the risks such as market risk, credit risk and liquidity risk management. The Groupregularly evaluates the market environment and changes in the Group’s operating activities todetermine whether to update the risk management policies and systems or not. The Group’s riskmanagement is carried out by the Risk Management Committee under policies approved by theBoard of Directors. The Risk Management Committee encourages the departments of the Group towork closely together to identify, evaluate and avoid relevant risks. The internal audit department ofthe Group conducts periodical audit to the controls and procedures for risk management and reportsthe audit results to the Risk Management Committee of the Group.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
13 Financial instrument and risk (Cont'd)
(1) Market risk
(a) Foreign exchange risk
The Group’s major operational activities are carried out in Mainland China and a majority of thetransactions are denominated in RMB. Some operational activities are carried out inregions/countries including Hong Kong, America, Korea and Europe and relevant transactions aresettled in HKD, USD, KRW and EUR. The management of the Group is exposed to foreignexchange risk arising from the recognised financial assets and financial liabilities denominated inforeign curreicies, and future transactions denominated in foreign currencies. Management isresponsible for monitoring the amount of financial assets and liabilities, and transactionsdenominated in foreign currencies, to reduce foreign exchange risk to the greatest extent.
As at 30 June 2020, the Group’s companies whose recording currency is RMB held the financialassets and the financial liabilities denominated in foreign currencies (mainly USD, HKD and EUR),of which the equivalent amounts in RMB are listed as below (31 December 2019: Immaterial):
| 30 June 2020 | |||||||
| USD | HKD | EUR | Total | ||||
| (RMB) | (RMB) | (RMB) | (RMB) | ||||
| Financial assets denominated in foreign currency | |||||||
| Cash at bank and on hand | 1,012,791,150.61 | 9,541,938.75 | 795,510.81 | 1,023,128,600.17 | |||
| Receivables | 49,185,054.07 | 34,327.59 | 27,682,727.03 | 76,902,108.69 | |||
| 1,061,976,204.68 | 9,576,266.34 | 28,478,237.84 | 1,100,030,708.86 | ||||
| Financial liabilities denominated in foreign currency | |||||||
| Payables | 80,514,273.80 | 1,382,945.34 | 5,885,687.59 | 87,782,906.73 | |||
As at 30 June 2020, if the RMB had strengthened/weakened by 5% against the USD while all othervariables had been held constant, the Group’s profit before tax for the year would have beenapproximately RMB 49,073,000.00 lower/higher respectively, for the above various financial assetsand liabilities denominated in USD.
The changes in exchange rate of other foreign currencies against RMB have no significant influenceon the Group’s operating activities.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
13 Financial instrument and risk (Cont'd)
(1) Market risk (Cont’d)
(a) Foreign exchange risk (Cont’d)
As at 30 June 2020 and 31 December 2019, the Group's overseas subsidiaries, except for thoseoperating in Hong Kong, held no significant financial assets and liabilities denominated in foreigncurrencies. Those companies operating in Hong Kong with HKD as recording currency held financialassets and liabilities denominated in foreign currency (mainly USD, RMB and EUR), of which theequivalent amounts in HKD (recording currency of companies operating in Hong Kong) and RMB(presentation currency of these financial statements) are listed as below:
| 30 June 2020 | |||||||||
| RMB | USD | EUR | Total | Total | |||||
| (HKD) | (HKD) | (HKD) | (HKD) | (RMB) | |||||
| Financial assets denominated in foreign currency | |||||||||
| Cash at bank and on hand | 99,841,973.34 | 45,488,646.21 | 2,994,550.26 | 148,325,169.81 | 135,482,884.99 | ||||
| Receivables | 912,297.41 | 43,468,041.13 | - | 44,380,338.54 | 40,538,605.69 | ||||
| Investments in other equity instruments | - | 2,485,036,092.38 | - | 2,485,036,092.38 | 2,269,931,368.22 | ||||
| 100,754,270.75 | 2,573,992,779.72 | 2,994,550.26 | 2,677,741,600.73 | 2,445,952,858.90 | |||||
| Financial liabilities denominated in foreign currency | |||||||||
| Payables | 4,188,951.39 | 57,489,595.60 | 34,975,157.30 | 96,653,704.29 | 88,287,061.06 | ||||
| 31 December 2019 | |||||||
| RMB | USD | Total | Total | ||||
| (HKD) | (HKD) | (HKD) | (RMB) | ||||
| Financial assets denominated in foreign currency | |||||||
| Cash at bank and on hand | 36,761,388.71 | 32,715,430.95 | 69,476,819.66 | 62,237,475.66 | |||
| Receivables | 45,378,223.56 | 27,514,334.24 | 72,892,557.80 | 65,297,510.67 | |||
| Investments in other equity instruments | - | 2,523,762,469.08 | 2,523,762,469.08 | 2,260,735,944.55 | |||
| 82,139,612.27 | 2,583,992,234.27 | 2,666,131,846.54 | 2,388,270,930.88 | ||||
| Financial liabilities denominated in foreign currency | |||||||
| Payables | 6,596,780.74 | 36,077,816.33 | 42,674,597.07 | 38,227,497.81 | |||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
13 Financial instrument and risk (Cont'd)
(1) Market risk (Cont’d)
(a) Foreign exchange risk (Cont’d)
As at 30 June 2020, if the HKD had strengthened/weakened by 1% against the USD while all othervariables had been held constant, the Group’s profit before tax and other comprehensive income forthe year would have been approximately HKD 315,000.00, equivalent to RMB 288,000.00 (31December 2019: approximately HKD 242,000.00, equivalent to RMB 217,000.00), and HKD24,850,000.00, equivalent to RMB 22,698,000.00 (31 December 2019: approximately HKD25,238,000.00, equivalent to RMB 22,608,000.00) lower/higher respectively for the above variousfinancial assets and liabilities denominated in USD.If the HKD had strengthened/weakened by 5% against the RMB while all other variables had beenheld constant, the Group’s profit before tax for the year would have been approximately HKD4,828,000.00, equivalent to RMB 4,410,000.00 (31 December 2019: approximately HKD3,777,000.00, equivalent to RMB 3,383,000.00) lower/higher for the above various financial assetsand liabilities denominated in RMB.
The changes in exchange rate of other foreign currencies against HKD have no significant influenceon the Group’s operating activities.
(b) Interest rate risk
The Group’s interest rate risk arises from long-term interest bearing debts including long-term bankborrowings and debentures payable. Financial liabilities issued at floating rates expose the Group tocash flow interest rate risk. Financial liabilities issued at fixed rates expose the Group to fair valueinterest rate risk. The Group determines the relative proportions of its fixed rate and floating ratecontracts depending on the prevailing market conditions. As at 30 June 2020, the Group’s long-terminterest bearing debts were mainly related to the contracts of floating rate long-term borrowingsdenominated in RMB and HKD, and fixed rate debentures payable denominated in RMB and USD.Among them, the contract amount of floating rate long-term borrowings denominated in RMB was1,618,059,208.49 (31 December 2019: RMB 2,047,494,503.19), and there was no floating ratelong-term borrowings denominated in HKD (31 December 2019: HKD 5,006,896,403.96, equivalentto RMB 4,492,062,281.22); the contract amount of fixed rate debentures payable denominated inRMB was 7,900,000,000.00 (31 December 2019: RMB 7,900,000,000.00), and the contract amountof fixed rate debentures payable denominated in USD was 1,200,000,000.00, equivalent to RMB8,495,400,000.00 (31 December 2019: USD 500,000,000.00, equivalent to RMB3,488,100,000.00).
The Group continuously monitors the interest rate position of the Group. Increases in interest rateswill increase the cost of new interest bearing borrowings and the interest expenses with respect tothe Group’s outstanding floating rate borrowings, and therefore could have a material adverse effecton the Group’s financial performance. Management makes adjustments timely with reference to thelatest market conditions and may enter into interest rate swap agreements to mitigate its exposureto interest rate risk.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
13 Financial instrument and risk (Cont'd)
(1) Market risk (Cont’d)
(b) Interest rate risk (Cont’d)
As at 30 June 2020, if interest rates on borrowings had risen/fallen by 50 basis points while all othervariables had been held constant, the Group’s profit before tax would have decreased/increased byapproximately RMB 8,090,000.00 (31 December 2019: RMB 32,700,000.00).
(c) Other price risk
The Group’s other price risk arises mainly from movements in price of various equity and debtinstruments measured at fair value that will not be sold within 1 year.
As at 30 June 2020, if the price of various investments in equity instruments measured at fair valuerises/falls by 10% while holding all other variables constant, the Group’s profit before tax and othercomprehensive income will be approximately RMB 53,630,000.00 (31 December 2019:
approximately RMB 47,900,000.00) and RMB 505,900,000.00 (31 December 2019: approximatelyRMB 493,369,000.00) higher/lower respectively.
(2) Credit risk
The Group's credit risk mainly arises from cash at bank and on hand, bank wealth managementproducts, placements with and loans to banks and other financial institutions, notes receivable,accounts receivable, factoring receivables, loans and advances, other receivables, contract assets,current portion of non-current assets, long-term receivables, investments in debt instrumentsmeasured at fair value through profit or loss that are not included in the assessment of impairment,etc. At the balance sheet date, the Group’s maximum exposure to credit risk represents the carryingamount of the Group’s financial assets, except that the maximum exposure to credit risk oflong-term receivables represents its undiscounted contractual cash flows.
The Group expects that there is no significant credit risk associated with cash at bank and on hand,bank wealth management products and placements with and loans to banks and other financialinstitutions since they are mainly deposits at state-owned banks and other medium or large sizelisted banks with good reputation and a higher credit rating. The Group does not expect that therewill be any significant losses from non-performance by these counterparties.
Notes receivable, accounts receivable, other receivables, contract assets, current portion ofnon-current assets and long-term receivables include receivables from related parties andreceivables from non-related parties. In respect of receivables from related parties, the Groupconsiders that they have low credit risk; in respect of receivables from non-related parties, theGroup will develop relevant policies to control the exposure to credit risk and will focus on their creditand recovery situation on a regular basis. In respect of customers with a poor credit history, theGroup will use payment reminders, or shorten or cancel credit periods, to ensure the overall creditrisk of the Group is limited to a controllable extent.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
13 Financial instrument and risk (Cont'd)
(2) Credit risk (Cont'd)
For factoring receivables and loans, the Group developed credit policies and operationalimplementation rules in accordance with the requirements of relevant state regulatory authorities,and implemented standardised management over the entire process of credit granting. In addition,the Group further improved the systems for credit risk monitoring and early warning and defectivecredit extension management. The Group actively responded to the changes in the creditenvironment, regularly analysed the situation and dynamic of credit risks and took risk controlmeasures on a forward-looking basis. The Group also established an optimisation managementmechanism for defective credit and accelerated the optimisation progress of defective credit to avoidnon-performing loans.
As at 30 June 2020, the Group had no significant collateral or other credit enhancements held as aresult of debtor’s mortgage.
(3) Liquidity risk
Cash flow forecasting is performed by each subsidiary of the Group and aggregated by the Group’sfinance department in its headquarters. Cash flow forecasting is aggregated by the Group. TheGroup monitors rolling forecasts of the Group’s short-term and long-term liquidity requirements toensure it has sufficient cash and securities that are readily convertible to cash to meet operationalneeds, while maintaining sufficient headroom on its undrawn committed borrowing facilities frommajor financial institutions so that the Group does not breach borrowing limits or covenants on anyof its borrowing facilities to meet the short-term and long-term liquidity requirements.
The financial liabilities of the Group at the balance sheet date are analysed by their maturity datebelow at their undiscounted contractual cash flows:
| 30 June 2020 | |||||||||
| Within 1 year | 1 to 2 years | 2 to 5 years | Over 5 years | Total | |||||
| Deposits from customers | 5,164,868.18 | - | - | - | 5,164,868.18 | ||||
| Accounts payable | 12,185,137,292.01 | - | - | - | 12,185,137,292.01 | ||||
| Notes payable | 15,000,000.00 | - | - | - | 15,000,000.00 | ||||
| Other payables | 5,434,784,386.15 | - | - | - | 5,434,784,386.15 | ||||
| Short-term borrowings | 6,639,175,512.15 | - | - | - | 6,639,175,512.15 | ||||
| Other current liabilities | 4,116,973,768.70 | - | - | - | 4,116,973,768.70 | ||||
| Current portion of non-current liabilities | 2,338,158,168.63 | - | - | - | 2,338,158,168.63 | ||||
| Long-term borrowings | 74,411,946.19 | 871,716,251.08 | 697,231,413.70 | 179,686,638.07 | 1,823,046,249.04 | ||||
| Debentures payable | 410,851,529.11 | 2,156,531,967.47 | 5,142,345,850.34 | 11,552,493,750.51 | 19,262,223,097.43 | ||||
| Long-term payables | - | 9,909,019.16 | - | 46,592,984.75 | 56,502,003.91 | ||||
| 31,219,657,471.12 | 3,038,157,237.71 | 5,839,577,264.04 | 11,778,773,373.33 | 51,876,165,346.20 | |||||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
13 Financial instrument and risk (Cont'd)
(3) Liquidity risk (Cont’d)
The financial liabilities of the Group at the balance sheet date are analysed by their maturity datebelow at their undiscounted contractual cash flows (Cont’d):
| 31 December 2019 | |||||||||
| Within 1 year | 1 to 2 years | 2 to 5 years | Over 5 years | Total | |||||
| Deposits from customers | 3,778,707.92 | - | - | - | 3,778,707.92 | ||||
| Accounts payable | 11,988,256,010.34 | - | - | - | 11,988,256,010.34 | ||||
| Notes payable | 30,000,000.00 | - | - | - | 30,000,000.00 | ||||
| Other payables | 4,707,159,830.62 | - | - | - | 4,707,159,830.62 | ||||
| Short-term borrowings | 6,151,261,091.68 | - | - | - | 6,151,261,091.68 | ||||
| Other current liabilities | 1,023,994,803.71 | - | - | - | 1,023,994,803.71 | ||||
| Current portion of non-current liabilities | 2,111,387,911.36 | - | - | - | 2,111,387,911.36 | ||||
| Long-term borrowings | 253,786,278.73 | 1,107,381,804.17 | 5,906,797,399.52 | 253,880,664.36 | 7,521,846,146.78 | ||||
| Debentures payable | 257,083,187.50 | 2,042,115,516.27 | 4,499,901,505.31 | 6,148,000,000.00 | 12,947,100,209.08 | ||||
| Long-term payables | 6,075,000.00 | 12,052,179.43 | 12,150,000.00 | 48,595,616.33 | 78,872,795.76 | ||||
| 26,532,782,821.86 | 3,161,549,499.87 | 10,418,848,904.83 | 6,450,476,280.69 | 46,563,657,507.25 | |||||
14 Fair value estimates
The level in which fair value measurement is categorised is determined by the level of the fair valuehierarchy of the lowest level input that is significant to the entire fair value measurement:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset orliability, either directly or indirectly.
Level 3: Unobservable inputs for the asset or liability.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
14 Fair value estimates (Cont’d)
(1) Financial assets and liabilities measured at fair value on a recurring basis
As at 30 June 2020, the financial assets measured at fair value on a recurring basis by the abovethree levels were analysed below:
| Level 1 | Level 2 | Level 3 | Total | ||||
| Financial assets held for trading- | |||||||
| Structural deposits | - | - | 13,471,241,285.61 | 13,471,241,285.61 | |||
| Others | 174,323.32 | - | - | 174,323.32 | |||
| Other non-current financial assets | |||||||
| Special scheme equity-class securities | - | - | 260,424,488.45 | 260,424,488.45 | |||
| Industrial fund investments | - | - | 275,846,467.40 | 275,846,467.40 | |||
| Investments in other equity instruments- | |||||||
| Equity instruments | 867,696,433.34 | - | 4,191,307,983.06 | 5,059,004,416.40 | |||
| Total financial assets | 867,870,756.66 | - | 18,198,820,224.52 | 19,066,690,981.18 |
As at 31 December 2019, the financial assets measured at fair value on a recurring basis by theabove three levels were analysed below:
| Level 1 | Level 2 | Level 3 | Total | ||||
| Financial assets held for trading- | |||||||
| Structural deposits | - | - | 2,909,852,581.06 | 2,909,852,581.06 | |||
| Others | 74,554.47 | 245,792.67 | - | 320,347.14 | |||
| Other non-current financial assets | |||||||
| Special scheme equity-class securities | - | - | 260,424,488.45 | 260,424,488.45 | |||
| Industrial fund investments | - | - | 218,615,943.17 | 218,615,943.17 | |||
| Investments in other equity instruments- | |||||||
| Equity instruments | 806,383,940.40 | - | 4,127,308,996.79 | 4,933,692,937.19 | |||
| Total financial assets | 806,458,494.87 | 245,792.67 | 7,516,202,009.47 | 8,322,906,297.01 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
14 Fair value estimates (Cont’d)
(1) Financial assets and liabilities measured at fair value on a recurring basis (Cont’d)
The Group takes the date on which events causing the transfers between the levels take place as the timing specific for recognising the transfers. Therewere no transfers between levels for the current period.
The fair value of financial instruments traded in an active market is determined at the quoted market price; and the fair value of those not traded in an activemarket is determined by the Group using valuation technique. The valuation models used mainly comprise discounted cash flow model and marketcomparable company model. The inputs of the valuation technique mainly include risk-free interest rate, benchmark rate, exchange rate, credit spread,liquidity premium, EBITDA multiplier, liquidity discount, etc.
The changes in Level 3 financial assets are analysed below:
| Financial assets held for trading | Other non-current financial assets | Other non-current financial assets | Other equity instruments | ||||
| - Structural deposits | - Special scheme equity-class securities | - Industrial fund investments | - Available-for-sale equity instruments | ||||
| 31 December 2019 | 2,909,852,581.06 | 260,424,488.45 | 218,615,943.17 | 4,127,308,996.79 | |||
| Increase in the current period | 61,765,000,000.00 | - | 56,616,465.82 | 500,000.00 | |||
| Decrease in the current period | (51,432,770,887.14) | - | - | - | |||
| Gains or losses recognised in profit or loss | 229,159,591.69 | - | 272,668.05 | - | |||
| Gains recognised in other comprehensive income | - | - | - | (10,728,054.93) | |||
| Translation of foreign currency financial statements | - | - | 341,390.36 | 74,227,041.20 | |||
| 30 June 2020 | 13,471,241,285.61 | 260,424,488.45 | 275,846,467.40 | 4,191,307,983.06 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
14 Fair value estimates (Cont’d)
(1) Financial assets and liabilities measured at fair value on a recurring basis (Cont’d)
| Available-for-sale financial assets | Available-for-sale financial assets | Other non-current financial assets | Other non-current financial assets | Other non-current financial assets | Other equity instruments | ||||||
| -Available-for-sale debt instruments | -Available-for-sale equity instruments | - Special scheme equity-class securities | - SAFE and discounted warrants | - Industrial fund investments | -Available-for-sale equity instruments | ||||||
| 31 December 2018 | 178,403,812.08 | 2,276,274,386.92 | - | - | - | - | |||||
| Changes in accounting policies | (178,403,812.08) | (2,276,274,386.92) | 178,403,812.08 | 344,685,887.97 | 105,000,000.00 | 1,997,472,148.15 | |||||
| 1 January 2019 | - | - | 178,403,812.08 | 344,685,887.97 | 105,000,000.00 | 1,997,472,148.15 | |||||
| Increase in the current period | - | - | - | - | 74,283,651.74 | 1,257,296,652.39 | |||||
| Decrease in the current period | - | - | (40,403,812.08) | (577,143,861.19) | - | (175,682.00) | |||||
| Gains or losses recognised in profit or loss | - | - | - | 304,239,702.03 | 16,000,000.00 | - | |||||
| Gains or losses recognised in other comprehensive income | - | - | - | - | - | (4,812,932.98) | |||||
| 30 June 2019 | - | - | 138,000,000.00 | 71,781,728.81 | 195,283,651.74 | 3,249,780,185.56 |
(2) Financial assets and liabilities not measured at fair value but disclosed
The Group’s financial assets and liabilities measured at amortised cost mainly include cash at bank and on hand, bank wealth management products,placements with and loans to banks and other financial institutions, receivables, factoring receivables, loans and advances, current portion of non-currentliabilities, long-term receivables, short-term borrowings, payables, long-term borrowings, debentures payable, current portion of non-current liabilities, othercurrent liabilities and long-term payables.
The carrying amount of financial assets and liabilities not measured at fair value is a reasonable approximation of their fair value.
The fair value of debentures payable that are traded in an active market is determined at quoted prices in the active market, categorised within Level 1 of thefair value hierarchy. The fair value of long-term borrowings and long-term payables is the present value of the contractually determined stream of future cashflows discounted at the rate of interest applied at that time by the market to instruments of comparable credit status and providing substantially the samecash flows on the same terms, and categorised within Level 3 of the fair value hierarchy.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
15 Capital management
The Group’s capital management policies aim to safeguard the Group’s ability to continue as agoing concern in order to provide returns for shareholders and benefits for other stakeholders, andto maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividendspaid to shareholders, refund capital to shareholders, issue new shares or sell assets to reducedebts.
The Group’s total capital is calculated as “Equity” as shown in the consolidated balance sheet. TheGroup is not subject to external mandatory capital requirements.
As at 30 June 2020 and 31 December 2019, the Group’s gearing ratio was as follows:
| 30 June 2020 | 31 December 2019 | ||
| Gearing ratio | 53.81% | 54.08% |
16 Notes to the Company’s financial statements
(1) Cash at bank and on hand
| 30 June 2020 | 31 December 2019 | ||
| Cash at bank | 141,166,499.31 | 967,647,842.56 | |
| Other cash balances | 16,643.40 | - | |
| 141,183,142.71 | 967,647,842.56 |
(2) Other receivables
| 30 June 2020 | 31 December 2019 | ||
| Dividends receivable from Taisen Holdings | - | 1,117,405,390.21 | |
| Funds raised by convertible corporate debentures granted to subsidiaries | 2,939,092,200.48 | 2,246,708,314.12 | |
| Others | 110,273.98 | 433,688.52 | |
| 2,939,202,474.46 | 3,364,547,392.85 | ||
| Less: Provision for bad debts | - | - | |
| 2,939,202,474.46 | 3,364,547,392.85 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
16 Notes to the Company’s financial statements (Cont’d)
(2) Other receivables (Cont’d)
The ageing of other receivables is analysed as follows:
| 30 June 2020 | 31 December 2019 | ||
| Within 1 year | 2,939,202,474.46 | 2,247,142,002.64 | |
| 1 to 2 years | - | 1,117,405,390.21 | |
| 2,939,202,474.46 | 3,364,547,392.85 |
(3) long-term receivables
| 30 June 2020 | 31 December 2019 | ||
| Funds raised by a non-public offering of shares granted to subsidiaries | 7,673,525,251.44 | 7,691,259,432.16 |
The above funds raised granted to subsidiaries constitute substantially a long-term equity in the netinvestment in the subsidiaries.
(4) Long-term equity investments
| 30 June 2020 | 31 December 2019 | ||
| Subsidiaries (a) | 43,323,539,117.29 | 43,323,539,117.29 | |
| Less: Provision for impairment of long-term equity investments | - | - | |
| 43,323,539,117.29 | 43,323,539,117.29 |
There is no significant restriction on sales of the long-term equity investments held by the Company.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
16 Notes to the Company’s financial statements (Cont’d)
(4) Long-term equity investments (Cont’d)
(a) Subsidiaries
| Accounting method | 31 December 2019 | Decrease in the current period | 30 June 2020 | Shareholding (%) | Voting rights (%) | Explanation of disparity between percentages of shareholding and voting rights | Provision for impairment loss | Cash dividends declared in the current period | ||||
| Taisen Holdings | Cost method | 43,323,539,117.29 | - | 43,323,539,117.29 | 100.00% | 100.00% | Not applicable | - | - |
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020
(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
16 Notes to the Company’s financial statements (Cont’d)
(5) Investment income
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Investment income from financial assets held for trading | 39,274,743.44 | - | |
| Investment income from wealth management products | 5,629,216.85 | 2,044,740.25 | |
| Others | - | (115,448.74) | |
| 44,903,960.29 | 1,929,291.51 | ||
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
1 Statement of non-recurring profit or loss
| For the six months ended 30 June | |||
| 2020 | 2019 | ||
| Gains on disposal of non-current assets | 7,613,935.62 | 315,373,555.74 | |
| Government grants recognised in profit or loss for the current period (government grants recognised in non-operating income, other income and deducted against related cost and expenses) | 426,807,766.64 | 175,408,699.42 | |
| Gains or losses on changes in fair value of financial assets and liabilities held for trading and investment (loss)/income arising from disposals of financial assets and liabilities held for trading | (1,429,156.76) | 347,394,450.91 | |
| Net loss of the subsidiaries for the period from the beginning of the period to the combination date arising from business combinations involving enterprises under common control | - | (1,303,632.26) | |
| Net amount of other non-operating income and expenses | (23,668,908.06) | 10,683,463.79 | |
| Sub-total | 409,323,637.44 | 847,556,537.60 | |
| Less: Income tax effect | (90,886,652.95) | (78,025,730.22) | |
| Less: Non-recurring profit or loss attributable to minority shareholders | (1,605,088.81) | (32,917.44) | |
| Non-recurring profit or loss attributable to shareholders of the parent company | 316,831,895.68 | 769,497,889.94 | |
| Including: Non-recurring profit or loss from continuing operations | 316,831,895.68 | 769,497,889.94 | |
Basis for preparation of statement of non-recurring profit or loss
Pursuant to the Explanatory Announcement for Information Disclosure of Companies OfferingSecurities to the Public No.1 - Non-recurring Profit or Loss (2008) issued by the China SecuritiesRegulatory Commission, non-recurring profit or loss refers to profit or loss arising from transactionsand events those are not directly related to the Company’s normal course of business, also fromtransactions and events those even are related to the company’s normal course of business, but willinterfere with the right judgement of users of the financial statements on the company’s operationperformance and profitability due to their special nature and occasional occurrence.
NOTES TO THE FINANCIAL STATEMENTSFOR THE SIX MONTHS ENDED 30 JUNE 2020(All amounts in RMB Yuan unless otherwise stated)[English translation for reference only]
2 Return on net assets and earnings per share
| Weighted average | Earnings per share | |||||||
| return on net assets (%) | Basic earnings per share | Diluted earnings per share | ||||||
| For the six months ended 30 June | For the six months ended 30 June | For the six months ended 30 June | ||||||
| 2020 | 2019 | 2020 | 2019 | 2020 | 2019 | |||
| Net profit attributable to ordinary shareholders of the Company | 8.51% | 8.20% | 0.85 | 0.70 | 0.85 | 0.70 | ||
| Net profit attributable to ordinary shareholders of the Company after deducting non-recurring profit or loss | 7.79% | 6.19% | 0.78 | 0.53 | 0.78 | 0.53 | ||
| Including: | ||||||||
| - Continuing operations | ||||||||
| Net profit attributable to ordinary shareholders of the Company | 8.51% | 8.20% | 0.85 | 0.70 | 0.85 | 0.70 | ||
| Net profit attributable to ordinary shareholders of the Company after deducting non-recurring profit or loss | 7.79% | 6.19% | 0.78 | 0.53 | 0.78 | 0.53 | ||
S.F. Holding Co., Ltd. 2020 Semi-Annual Report
Chapter 12 List of Documents Available for Inspection
(1) Financial statements signed and sealed by the legal representative, the person in charge of
finance and the person in charge of the accounting department of the Company.
(2) The original copies of all documents and announcements of the Company which have been
publicly disclosed in newspapers designated by the China Securities Regulatory Commissionduring the reporting period.
(3) The original text of the 2020 Semi-Annual report signed by the chairman of the Board of
Directors.
(4) The place where the above documents are maintained: the office of the Company’s Board of
Directors.
S.F. Holding Co., Ltd. 2020 Semi-Annual Report