Jiangsu Yanghe Distillery Co., Ltd.
2022 Annual Report
April 2023
Section I Important Statements, Contents and Definitions
The board of directors, board of supervisors, directors, supervisors and senior management of Jiangsu YangheDistillery Co., Ltd. (hereinafter referred to as the Company) hereby guarantee that the information presented inthis report is free of any false records, misleading statements or material omissions, and shall individually andtogether be legally liable for truthfulness, accuracy and completeness of its contents.
Mr. Zhang Liandong, responsible person for the Company, Mr. Yin Qiuming, responsible person for accountingaffairs and Mr. Zhao Qike, responsible person for accounting department (accounting supervisor) have warrantedthat the financial statements in this report are true, accurate and complete.
All directors attended the board meeting to review this report.
The future plans and some other forward-looking statements mentioned in this report shall not be considered asvirtual promises of the Company to investors. Investors and people concerned should maintain adequate riskawareness and understand the difference between plans, predictions and promises. Investors are kindlyreminded to pay attention to possible investment risks.
In the annual report, the possible risks in the operation of the Company are described in detail (see 11. Outlookfor the Future Development of the Company in Section III Management Discussion and Analysis). Investors arekindly reminded to pay attention to relevant content.
The profit distribution plan approved by the board of directors: based on total share capital participating in thedividend on the registration date (excluding the repurchased shares held in the Company's special repurchasesecurities account) when the profit distribution plan is implemented in the future, a cash dividend of CNY 37.40(tax inclusive) will be distributed for every 10 existing shares held, 0 shares of bonus shares (tax inclusive), andreserves would not be converted into share capital.
The Company’s Chinese 2022 Annual Report was publicly disclosed on the Shenzhen Stock Exchange andwww.cninfo.com.cn on 26 April 2023. If there are any differences between the English version and the Chineseone, please refer to the latter.
ContentsSection I Important Statements, Contents and Definitions……………………………….2Section II Company Profile and Key Financial Results……………………………………….5Section Ⅲ Management Discussion and Analysis……………………………………………10Section Ⅲ Corporate Governance…………………………………………………………………..35Section Ⅲ Environment and Social Responsibility…………………………………………..71Section Ⅲ Significant Events…………………………………………………………………………..78Section Ⅲ Changes in Shares and Information about Shareholders………………..99Section Ⅲ Information about Preference Shares…………………………………………….109Section Ⅲ Information about Bonds……………………………………………………………...110SectionⅩ Financial Report…………………………………………………………………………….111
Definitions
Term | Reference | Definition |
The Company, This Company, Yanghe | Refer to | Jiangsu Yanghe Distillery Co., Ltd. |
Yanghe Group, Controlling shareholder | Refer to | Jiangsu Yanghe Group Co.,Ltd. |
The current year, In the reporting period | Refer to | 1 Jan. 2022 to 31 Dec. 2022 |
The report | Refer to | 2022 Annual Report |
Yuan, Ten thousand yuan, A hundred million yuan | Refer to | CNY 0.00, CNY 10,000.00, CNY 100,000,000.00 |
The shareholders' meeting, the board of directors, the board of supervisors | Refer to | The shareholders' meeting, the board of directors and the board of supervisors of the Company |
Articles of incorporation | Refer to | Articles of incorporation of Jiangsu Yanghe Distillery Co., Ltd. |
SSE | Refer to | Shenzhen Stock Exchange |
SRC, CSRC | Refer to | China Securities Regulatory Commission |
SAC of Suqian, SASAC of Suqian | Refer to | State-owned Assets Supervision and Administration Commission of Suqian |
Suya Jincheng, Accounting firm | Refer to | Suya Jincheng CPA LLP |
Blue Alliance | Refer to | Jiangsu Blue Alliance Co., Ltd. |
Yanghe Branch of the Company | Refer to | Jiangsu Yanghe Distillery Co., Ltd. Yanghe Branch |
Siyang Branch of the Company | Refer to | Jiangsu Yanghe Distillery Co., Ltd. Siyang Branch |
Shuanggou Distillery | Refer to | Jiangsu Shuanggou Distillery Stock Co.,Ltd. |
Guijiu Comapny | Refer to | Guizhou Guijiu Co., Ltd. |
Inside and outside the province | Refer to | Inside and outside Jiangsu Province |
Section II Company Profile and Key Financial Results
1. Corporate information
Stock abbreviation | Yanghe | Stock code | 002304 |
Stock exchange where the shares of the Company are listed | Shenzhen Stock Exchange | ||
Name of the Company in Chinese | 江苏洋河酒厂股份有限公司 | ||
Abbr. of the Company name in Chinese | 洋河股份 | ||
Name of the Company in English (if any) | Jiangsu Yanghe Distillery Joint-Stock Co., Ltd. | ||
Abbr. of the Company name in English (if any) | Yanghe | ||
Legal representative | Zhang Liandong | ||
Registered address | No.118 Middle Avenue, Yanghe Town, Suqian City, Jiangsu Province, China | ||
Postal code of registered address | 223800 | ||
Historical changes of the company's registered address | N/A | ||
Business address | No.118 Jiudu Avenue, Yanghe Town, Suqian City, Jiangsu Province, China | ||
Postal code of business address | 223800 | ||
Company website | http://www.chinayanghe.com | ||
yanghe002304@chinayanghe.com |
2. Contact us
Company secretary | Representative for securities affairs | |
Name | Lu Hongzhen | Sun Dali |
Address | No.118 Jiudu Avenue, Yanghe Town, Suqian City, Jiangsu Province | No.118 Jiudu Avenue, Yanghe Town, Suqian City, Jiangsu Province |
Tels. | 0527-84938128 | 0527-84938128 |
Fax | 0527-84938128 | 0527-84938128 |
yanghe002304@chinayanghe.com | yanghe002304@chinayanghe.com |
3. Information disclosure and place where the annual report is kept
The website of the stock exchange where the company discloses the annual report | Securities Times, Shanghai Securities Times, China Securities Journal, Securities Daily |
Media name and website of the annual report disclosed by the company | http://www. cninfo.com.cn |
Place where the Annual Report of the Company is kept | Shareholder reading room, the headquarters of the Company, Suqian City, Jiangsu Province |
4. Company registration and alteration
Organization code | 9132000074557990XP |
Changes in main business activities since the Company was listed (if any) | None |
Changes of controlling shareholders of the Company (if any) | None |
5. Other relevant information
Accounting firm engaged by the Company
Name of the accounting firm | Suya Jincheng CPA LLP |
Business address of the accounting firm | 14-16/F., Block A, Zhengtai Center, No.159 Taishan Road, Jianye District, Nanjing, Jiangsu Province |
Name of accountants for writing signature | Li Laimin, Li Yan |
Sponsors engaged by the Company to continuously perform its supervisory function during the reporting period
□Applicable √ N/A
Financial adviser engaged by the Company to continuously perform its supervisory function during the reportingperiod
□Applicable √ N/A
6. Key accounting data and financial indicators
Whether the Company performed a retroactive adjustment or restatement of accounting data
□Yes ?No
2022 | 2021 | YoY Change | 2020 | |
Operating revenues (CNY) | 30,104,896,186.70 | 25,350,178,204.45 | 18.76% | 21,101,051,131.79 |
Net profits attributable to shareholders of the Company (CNY) | 9,377,832,429.08 | 7,507,682,797.40 | 24.91% | 7,482,228,633.63 |
Net profits attributable to shareholders of the Company before non-recurring gains and losses (CNY) | 9,276,644,831.29 | 7,372,758,257.29 | 25.82% | 5,652,068,941.98 |
Net cash flows from operating activities (CNY) | 3,647,623,952.19 | 15,318,165,480.53 | -76.19% | 3,978,790,835.80 |
Basic earnings per share (CNY/share) | 6.2251 | 5.0141 | 24.15% | 4.9843 |
Diluted earnings per share (CNY/share) | 6.2251 | 5.0141 | 24.15% | 4.9843 |
Weighted average ROE | 21.03% | 18.55% | 2.48% | 20.20% |
At the end of 2022 | At the end of 2021 | YoY Change | At the end of 2020 | |
Total assets (CNY) | 67,964,247,134.43 | 67,798,704,193.76 | 0.24% | 53,866,259,306.59 |
Net assets attributable to shareholders of the Company (CNY) | 47,474,946,974.68 | 42,486,209,789.59 | 11.74% | 38,484,583,983.54 |
The Company's net profit before or after deducting non-recurring profits and losses in the last three fiscal years isnegative, and the audit report of the last year shows that the Company's ability to continue operating isuncertain
□Yes ?No
The net profit before or after deducting non-recurring profits and losses is negative
□Yes ?No
7. Differences in accounting data under domestic and overseas accounting standards
1. Differences in the net profits and net assets disclosed in the financial reports prepared under the internationaland China accounting standards
□Applicable √ N/A
No such differences during this period.
2. Differences in the net profits and net assets disclosed in the financial reports prepared under the outboundand China accounting standards
□Applicable √ N/A
No such differences during this period.
8. Key financial results by quarter
Unit: CNY
Q1 | Q2 | Q3 | Q4 | |
Operating revenues | 13,026,004,652.73 | 5,881,994,189.67 | 7,574,626,286.45 | 3,622,271,057.85 |
Net profits attributable to shareholders of the Company | 4,985,243,733.48 | 1,908,128,487.64 | 2,178,470,980.32 | 305,989,227.64 |
Net profits attributable to shareholders of the Company before deducting non-recurring profits and losses | 4,897,883,633.65 | 1,744,789,237.61 | 2,200,554,186.42 | 433,417,773.61 |
Net cash flows from operating activities | -3,061,792,273.86 | -1,391,962,784.13 | 3,497,754,845.22 | 4,603,624,164.96 |
Whether there are any material differences between the financial indicators above or their summations andthose which have been disclosed in quarterly or semi-annual reports.
□Yes ?No
9. Non-recurring profits and losses
√Applicable □N/A
Unit: CNY
Item | 2022 | 2021 | 2020 | Note |
Profit or loss from disposal of non-current assets (including the write-off portion of the impairment provision) | -5,887,909.75 | -10,687,905.76 | -4,735,638.66 | |
Government grants included in the profit or loss for the current period (except those closely related to the normal business of the company, in line with the provisions of national policies, and continuously enjoyed according to a certain standard quota or quantity) | 60,162,525.57 | 87,366,302.47 | 98,175,595.19 | |
Except for the effective hedging business related to the normal business of the company, profits and losses from changes in fair value arising from holding trading financial assets and trading financial liabilities, as well as the investment income obtained from the disposal of trading financial assets, trading financial liabilities and financial assets available for sale | 77,907,331.60 | 153,349,470.08 | 2,356,818,184.75 | |
Impairment provision reversal of the accounts receivables on which the impairment test is carried out individually | 12,009,031.70 | |||
Other non-operating income and expenditure except above-mentioned items | 827,476.72 | -31,556,128.88 | -11,429,697.22 |
Other profit and loss items that conform tothe definition of non-recurring profits andlosses
Other profit and loss items that conform to the definition of non-recurring profits and losses | 3,610,292.93 | 3,484,445.51 | 818,031.70 | |
Less: Corporate income tax | 34,647,176.78 | 79,096,331.61 | 609,395,883.18 | |
Minority interests (after tax) | 784,942.50 | -55,656.60 | 90,900.93 | |
Total | 101,187,597.79 | 134,924,540.11 | 1,830,159,691.65 | -- |
Details of other profit and loss items that meet the definition of non-recurring profit and loss:
□Applicable √ N/A
The company has no specific circumstances of other profit and loss items that meet the definition ofnon-recurring profit and loss.Description of defining non-recurring profit and loss items listed in the Explanatory Announcement No. 1 onInformation Disclosure for Listed Companies -Non-recurring Profits and Losses as recurring profit and loss items.
□Applicable √ N/A
There is no such situation that the company classifies the non-recurring profit and loss items listed in theExplanatory Announcement No. 1 on Information Disclosure for Listed Companies -Non-recurring Profits andLosses as recurring profit and loss items.
Section Ⅲ Management Discussion and Analysis
1. Industry conditions faced by the company during the reporting periodAccording to the data of the National Bureau of Statistics, there were 963 Chinese Baijiu enterprises abovedesignated size nationwide in 2022, a decrease of 2 compared with the previous year; The output of ChineseBaijiu was 6,712,400.00 kiloliters, a year-on-year decrease of 5.58%; The operating revenue was CNY662.645billion, a year-on-year increase of 9.64%; The total profit was CNY220.172 billion, a year-on-year increase of
29.36%. The total production and sales volume of Chinese Baijiu industry were stable, and the competitionsamong famous liquor producing areas, regional markets and price segments intensified, the trend ofconsolidation, branding and premiumization became more prominent. The development of Chinese Baijiuindustry has shown a steady upward trend in the fierce competition.
Yanghe is a large Chinese Baijiu production enterprise enjoying high brand awareness and reputation nationwide.It is the only enterprise in the Chinese Baijiu industry that owns two famous Chinese Baijiu brands, Yanghe andShuanggou, two time-honored Chinese brands, six well-known Chinese trademarks, and two 4A level scenicspots. The company's leading products are Dream Blue, Sky Blue, Ocean Blue, Sujiu, Zhenbaofang, Yanghe Daqu,Shuanggou Daqu and so on. During the reporting period, in the face of complex international and domesticsituations and fierce market competition, the company overcame pressure and maintained a healthydevelopment trend of "steady progress" and achieved an operating revenue of CNY30.105 billion, a year-on-yearincrease of 18.76%; The company realized a net profit attributable to shareholders of listed companies ofCNY9.378 billion, a year-on-year increase of 24.91%. According to the report of Chinese Baijiu listed companies inthe first three quarters of 2022, the sales scale of the company ranked among the top three in the industry.
2. Main Businesses of the Company During the Reporting Period
The company shall comply with the disclosure requirements of food and wine manufacturing industries inSelf-regulatory Guidelines for Listed Companies in Shenzhen Stock Exchange No. 3 - Industry InformationDisclosure
The main business engagedThe main business of the company is the production and sales of Chinese Baijiu, which is produced by solid-statefermentation and sold mainly through two modes: wholesale distribution and online direct sales. The company'smain business and business model did not change during the reporting period. According to the IndustryClassification Guidelines for Listed Companies (revised in 2012) issued by the CSRC, the company belongs to the"C15 wine, beverage and refined tea manufacturing industry".
Information about brand operationThe Company’s products include Dream Blue, Sujiu, Sky Blue, Zhenbaofang, Ocean Blue, Yanghe Daqu,Shuanggou Daqu, Guijiu, Sidus Wine and so on. According to the price range standard of ex-factory price, theCompany groups the products into mid/high end and ordinary products. The mid/high end products refer tothose with ex-factory price ≥ CNY 100 / 500ml, mainly including Dream Blue craft class, Dream Blue M9,Dream Blue M6 +, Dream Blue Crystal version, Su Jiu, Sky Blue, Zhenbaofang (Difang, Shengfang), Ocean Blue andso on. Ordinary products refer to those with ex-factory price < CNY 100 / 500ml, mainly including Yanghe Daquand Shuanggou Daqu.The revenue of various products is as follows:
Unit: CNY
Products | Operating revenue | |
2022 | YoY change |
Mid/high end products
Mid/high end products | 26,226,828,574.84 | 21.87% |
Ordinary products | 3,273,034,492.80 | 4.97% |
Main sales modelThe company sells its products mainly through distributors. Its sales models include wholesale distribution andonline direct selling, among which wholesale distribution is the main sales model.
√Applicable □N/A
1. Disclosure of main business composition by different types
Unit: CNY
Types | Operating revenue | YoY change | Operating cost | YoY change | Gross margin | YoY change |
By sales model |
Wholesaledistribution
Wholesale distribution | 29,107,238,759.97 | 19.91% | 7,130,879,687.09 | 26.20% | 75.50% | -1.22% |
Online direct selling | 392,624,307.67 | 7.68% | 84,037,614.45 | 60.96% | 78.60% | -7.08% |
Subtotal | 29,499,863,067.64 | 19.73% | 7,214,917,301.54 | 26.51% | 75.54% | -1.31% |
By geographical segment
By geographical segmentJiangsu
Jiangsu | 13,321,057,010.40 | 15.28% | 3,659,281,374.24 | 24.59% | 72.53% | -2.05% |
Ex-Jiangsu | 16,178,806,057.24 | 23.66% | 3,555,635,927.30 | 28.55% | 78.02% | -0.84% |
Subtotal
Subtotal | 29,499,863,067.64 | 19.73% | 7,214,917,301.54 | 26.51% | 75.54% | -1.31% |
By product
By product | ||||||
Mid/high end products | 26,226,828,574.84 | 21.87% | 5,171,156,593.59 | 28.34% | 80.28% | -1.00% |
Ordinary products | 3,273,034,492.80 | 4.97% | 2,043,760,707.95 | 22.11% | 37.56% | -8.76% |
Subtotal
Subtotal | 29,499,863,067.64 | 19.73% | 7,214,917,301.54 | 26.51% | 75.54% | -1.31% |
The company's main products are classified according to the price range standard of ex-factory price, includingmedium/high end products ≥ 100 CNY / 500ml and ordinary products < 100 CNY / 500ml.
2. Disclose the number of distributors according to regional classification
Geographical segment | Distributor number at the end of the reporting period | Increase number during the reporting period | Decrease number during the reporting period |
Jiangsu | 2977 | 325 | 298 |
Ex-Jiangsu | 5261 | 1570 | 1501 |
Total | 8238 | 1895 | 1799 |
During the reporting period, the change in the number of distributors was mainly due to the company'soptimization of distribution structure and in-depth national layout, and further adjustment of the distributionsystem.
3. Settlement method and distribution method
The Company mainly adopts the bank transfer method for settlement, and adopts the method of paymentbefore goods for product sales.
4. Sales amount and sales proportion of the top five distributors
In 2022, the total sales amount of the top five distributors was CNY 1,540.4580 million, accounting for 5.12% ofthe total sales of this year. Among the sales of the top five distributors, the sales from related parties were CNY 0,accounting for 0% of the total sales of this year. The total amount of receivables of the top five distributors at theend of the period was zero.
Retail sales accounted for more than 10%.
□Applicable √ N/A
Online direct selling
√ Applicable □N/A
Unit: CNY
Product | Online direct selling | Sales amount in 2022 | Sales amount in 2021 | YoY change |
Liquor | E-commerce platforms | 392,624,307.67 | 364,634,097.30 | 7.68% |
The sales price of the main products accounting for more than 10% of the total operating revenue of thecurrent period changed by more than 30% compared with the previous reporting period
□Applicable √ N/A
Procurement mode and content
Unit: CNY
Procurement mode | Procurement content | Amount |
Market bidding | Raw materials and packaging materials | 6,277,275,721.68 |
Marketing purchase | Energy | 413,914,303.34 |
Procurement of raw materials from cooperatives or farmers accounted for more than 30% of the total purchaseamount
□Applicable √ N/A
The price of major outsourced raw materials changed by over 30% year on year
□Applicable √ N/A
Main production modeThe Company's production mode is self-produced mode, with major parts including raw material crushing,
fermentation, distillation, grade storage, liquor body design and combination, product packaging, etc.Commissioned production
□Applicable √ N/A
The main components of operating costs
Unit:CNY
Types | Cost item | 2022 | 2021 | YoY change | ||
Amount | As a percentage of operating cost | Amount | As a percentage of operating cost |
Chinese
Baijiu
Chinese Baijiu | Direct materials | 5,316,873,839.12 | 69.54% | 4,033,119,166.37 | 64.47% | 31.83% |
Direct labor | 1,238,729,841.81 | 16.20% | 1,083,148,551.48 | 17.32% | 14.36% | |
Fuels and energy | 288,045,390.08 | 3.77% | 234,523,774.33 | 3.75% | 22.82% | |
Manufacturing overhead | 283,314,445.64 | 3.71% | 252,473,495.64 | 4.04% | 12.22% |
Output and inventory
1. Production volume, sales volume and inventory of major products
Types | Item | Unit | 2022 | 2021 | YoY change |
Chinese Baijiu | Sales | Ton | 195,322.68 | 184,001.07 | 6.15% |
Production | Ton | 197,590.68 | 204,331.95 | -3.30% | |
Inventory | Ton | 46,496.48 | 44,228.48 | 5.13% |
2. Inventory of finished and semi-finished Baijiu at the end of the period
Inventory of finished products (in tons, including baijiu and wine) | Inventory of semi-finished Baijiu (including raw liquor) (ton) |
47,335.63 | 623,356.32 |
3. Capacity of the Company
Name of production entity | Design capacity of finished products (ton) | Actual capacity in 2022 (ton) |
Yanghe (including Yanghe branch and Siyang branch) | 222,545 | 149,275 |
Shuanggou Distillery | 97,040 | 44,143 |
3. Analysis of core competitiveness
The Company has significant advantages in natural environment, quality technology, brand building, marketingnetwork and so on. The Company has formed its unique core competitiveness, which has not changed during thereporting period.
1. Natural environment advantage
The Company is located in Suqian, the capital of Chinese Baijiu with 'three rivers, two lakes and one wetland’. Asone of the three famous wetlands in the world, Suqian enjoys equal popularity with the Scotch whisky producing
area and the French Cognac producing area. The long history and unique ecological environment provide a goodsource of water, soil and air for production for liquor production. Especially the microorganism condition issignificantly beneficial to production. The Yanghe distillery originated in the Sui and Tang Dynasties, flourished inthe Ming and Qing Dynasties. It had been sold in Jianghuai area during the period of Yong Zheng of Qing Dynasty.It has a good reputation that 'dainty taste derived from fortune spring and liquor ocean, which made Yangherank first place in Jianghuai area'. Shuanggou alongside Yanghe was praised as the origin of Chinese natural liquorby domestic and overseas experts due to the discovery of drunken ape fossils in Xiacaowan.
2. Quality advantage
Considering the diversification and individuation of consumption demand, the Company took the lead inbreaking the traditional classification of Baijiu flavor. The Company classifies Baijiu based on taste andemphasizes the value of taste. The Company strengthens the mellowness of Baijiu, puts forward the new style ofthe mellow Baijiu quality, and deeply meets core demand of target consumers. It has successfully establishednew craft of mellow Baijiu production and system framework of mellowness mechanism, which caters to marketconsumption. In June 2008, "Mellowness", a special type of Yanghe, was first written into the national standardin China Protected Geographical Indication Product- Yanghe Daqu (Standard No. GB/T220406-2008). In 2019, thecompany formulated the group standard named "Mellow Baijiu" (i.e., t/cbj2104-2019), which further enrichedand improved the relevant standards of mellow Baijiu. In 2022, the company formulated the standards of "BaijiuWetland Real Estate Area" (T/CBJ2305-2022) and "Wetland Baijiu" (T/CBJ2110-2022), which promoted thespecification of technical quality standards for wetland liquor.
3. Talent advantage
The Company has 39 Masters of Chinese Baijiu, 78 provincial Baijiu tasting committee members and 1975technicians. The Company also has 10 national and provincial technical research and development platforms. Theobvious advantage of technical talents provides technical support for the continuous improvement of mellowBaijiu quality. In 2022, the company's three scientific and technological achievements, "Research and Applicationof Targeted Flavor Song of Mianrou Baijiu", "Integrated Research and Industrial Application of Digital Technologyfor Solid Liquor Brewing", and "Research on Autophagy and Antioxidant Effects of Mianrou Baijiu" wereidentified by the China Light Industry Federation. In the 6th National Sommelier Competition sponsored by theChina Alcoholic Drinks Association, the company won the championship for five consecutive times, and 6representatives entered the top ten of the lists, fully demonstrating the company's talent advantages.
4. Brand advantage
The Company, as one of the eight traditional well-known Baijiu enterprises, is the only one in China's liquorindustry that has two Chinese famous wines, Yanghe and Shuanggou, two Chinese time-honored brands, sixwell-known Chinese trademarks such as Yanghe, Shuanggou, Blue Classic, Zhenbao Fang, Dream Blue, Su, twonational 4A scenic spots, two national industrial heritages, and a national key cultural relics protection unit. In2022, in the "2022 World's Top 50 Most Valuable Spirits Brand Value" released by Brand Finance, aworld-renowned brand value research institution, the company ranked fourth in the world with a brand value ofUSD6.446 billion and ranked 102
nd
in the "China's 500 Most Valuable Brands" released by World Brand Lab, witha brand value of CNY75.545 billion.
5. Marketing network advantage
The company has a marketing team with the latest ideas and the strongest execution. Its marketing network has
penetrated into all counties and regions in China; The high-speed channel for distribution has been basically built,laying a solid foundation for future market expansion and category extension. Meanwhile, as a traditionalenterprise, Yanghe has consistently optimized new sales model and advanced digital transformation. The salesdigitalization of Yanghe has become a case study for Tsinghua University, showcasing the leading position ofYanghe in internet application.
4. Analysis of main business
1. Overview
During the reporting period, the company closely focused on the main line of high-quality development,efficiently implemented annual work deployment and planning, and maintained the development trend of"seeking progress in stability and excellence in progress", accumulating strength for writing a new chapter of"stable high quality, sustainable in progress, and healthier in good life". In 2022, the company achieved anoperating income of CNY30.105 billion, a year-on-year increase of 18.76%; The net profit attributable toshareholders of the listed company was CNY9.378 billion, a year-on-year increase of 24.91%; The net profitattributable to shareholders of the listed company after deducting non-recurring profits and losses was CNY9.277billion, a year-on-year increase of 25.82%.
Solid strengths and supports are deeply integrated, and products are upgraded on the basis of improvingquality. Continue to explore the research and application of the mechanism of Mianrou, three innovativescientific and technological achievements have been identified, and the yield and quality of winemaking haveachieved a double harvest. In the National Sommelier Competition sponsored by the China Alcoholic DrinksAssociation, the company's technical team won the championship for five consecutive times, which furtherhighlighted the talent advantage. Continue to optimize the storage structure of raw wine, and orderly promotethe construction of key projects such as high-end wine storage, which provides strong support for the ultimatesoftness. Focusing on the concept of "product refinement, structural optimization, and scale expansion", DreamBlue handmade class (master) was launched, upgraded Haizhi Blue, Ecological Sujiu, Difang and other products,sorted out and eliminated 218 SKUs, consolidated the position of Meng6+ strategic subject, strengthened thecultivation of crystal version of Dream Blue consumers, and continuously expanded the scale of Ocean Blue, andfurther optimized the product matrix.
The deep integration of cohesion and combat effectiveness promotes the development of the company andaccumulates advantages. Continue to build a "strategic community, value community, interest community, anddestiny community" for manufacturers, focus on the structural optimization of distributors, and improve thecultivation system for distributors around "attracting large enterprises, supporting excellent enterprises, andstrengthening good enterprises ", and further improve the quality of distributors’ teams. Strengthen channelconstruction, adapt measures to local conditions in the regional market, comprehensively enhance thecompetitiveness of the market in Jiangsu province, steadily promote the sales market outside the province, andeffectively break through the cultivation market outside Jiangsu province. To help market construction withdigitalization, digital marketing tools were utilized in main products were to achieve monitoring, analysis andtraceability of the whole process, and jointly help the marketing.
The organizational force and the driving force are deeply integrated, and the forward momentum iscontinuously gathered. Focusing on "the marketing headquarters formulates the strategy and the businessdepartment is responsible for the implementation", it promotes the adjustment of the marketing organizational
structure, realizes the sinking of the organizational structure, effectively stimulates the potential of the team, andimproves the organizational efficiency. Guided by the "Nine Persistence," the company trains cadres, discoverscadres, selects and promotes cadres, and appoints cadres on the front line, so as to deeply stimulates andmobilizes the enthusiasm of cadres. Continue to build a collaborative supervision system and make every effortto purify the market business environment. Improve the incentive mechanism of "efficient growth, efficientincentive and efficient constraint" of the marketing system, improve the "communication, assistance,emergency" mechanism and the welfare system of "activities, treatment and service" to stimulate thehigh-quality development of the company.
The leading power and the appeal are deeply integrated, and the highlights of the brand continue to appear.With dream culture as the link, broaden the brand communication matrix, and actively spread Chinese wineculture with the help of international events such as the SCO Summit and the 51st anniversary of China-US tabletennis diplomacy; Together with the Space Foundation to fully support the launch of the Wentian ExperimentalModule, Mengtian Experimental Module and the 14th China Aerospace Expo; Innovative publicity methods, theMid-Autumn Festival live broadcast has reached tens of millions of viewers, and the new version of Ocean Blue isefficiently spread with the help of the power of science and technology; Actively promote the construction of the"Dream Blue Brand Experience Center", and improve the consumer operation system through online consumeroperation and offline consumer attraction. Continuously practicing social responsibility, poverty alleviation andrural revitalization have been deepened, and the "Chinese Craftsmanship, Light of Dreams" sealing ceremonywas successfully held, and the "National Harmonious Labor Relations Creation Demonstration Enterprise" wasobtained, realizing the effective linkage between the dream of enterprise development and the dream ofemployee growth, the dream of partners, and the dream of home.
2. Revenues and cost of sales
(1) Breakdown of operating revenues
Unit:CNY
2022 | 2021 | YoY change | |||
Amount | As a percentage of operating revenues | Amount | As a percentage of operating revenues | ||
Total | 30,104,896,186.70 | 100% | 25,350,178,204.45 | 100% | 18.76% |
By business segment | |||||
Liquor | 29,499,863,067.64 | 97.99% | 24,638,674,089.57 | 97.19% | 19.73% |
Other | 605,033,119.06 | 2.01% | 711,504,114.88 | 2.81% | -14.96% |
By product | |||||
Baijiu | 29,338,843,747.26 | 97.46% | 24,440,221,392.60 | 96.41% | 20.04% |
Wine | 161,019,320.38 | 0.53% | 198,452,696.97 | 0.78% | -18.86% |
Other | 605,033,119.06 | 2.01% | 711,504,114.88 | 2.81% | -14.96% |
By geographical segment | |||||
Jiangsu | 13,594,267,792.89 | 45.16% | 11,800,507,954.17 | 46.55% | 15.20% |
Ex-Jiangsu | 16,510,628,393.81 | 54.84% | 13,549,670,250.28 | 53.45% | 21.85% |
By sales model | |||||
Wholesale distribution | 29,107,238,759.97 | 96.69% | 24,274,039,992.27 | 95.75% | 19.91% |
Online directselling
Online direct selling | 392,624,307.67 | 1.30% | 364,634,097.30 | 1.44% | 7.68% |
Other | 605,033,119.06 | 2.01% | 711,504,114.88 | 2.81% | -14.96% |
(2) Business segment, products, geographical segments or sales models contributing over 10% of theoperating revenues or profits
√ Applicable □N/A
Unit: CNY
Operating revenues | Cost of sales | Gross profit margin | YoY change of operating revenue | YoY change of cost of sales | YoY change of gross profit margin | |
By business segment | ||||||
Liquor | 29,499,863,067.64 | 7,214,917,301.54 | 75.54% | 19.73% | 26.51% | -1.31% |
By product | ||||||
Baijiu | 29,338,843,747.26 | 7,126,963,516.65 | 75.71% | 20.04% | 27.19% | -1.36% |
By geographical segment | ||||||
Jiangsu | 13,321,057,010.40 | 3,659,281,374.24 | 72.53% | 15.28% | 24.59% | -2.05% |
Ex-Jiangsu | 16,178,806,057.24 | 3,555,635,927.30 | 78.02% | 23.66% | 28.55% | -0.84% |
By sales mode | ||||||
Wholesale distribution | 29,107,238,759.97 | 7,130,879,687.09 | 75.50% | 19.91% | 26.20% | -1.22% |
Online direct selling | 392,624,307.67 | 84,037,614.45 | 78.60% | 7.68% | 60.96% | -7.08% |
Under the circumstances that the statistical standards for the Company’s main business data adjusted in thereporting period, the Company’s main business data in the current one year is calculated based on adjustedstatistical standards at the end of the reporting period.
□Applicable √ N/A
(3) Whether revenue from physical sales is higher than service revenue
√ Applicable □N/A
By business segment | Item | Unit | 2022 | 2021 | YoY change |
Baijiu | Sales volume | Ton | 195,322.68 | 184,001.07 | 6.15% |
Production volume | Ton | 197,590.68 | 204,331.95 | -3.30% | |
Inventory volume | Ton | 46,496.48 | 44,228.48 | 5.13% | |
Wine | Sales volume | Ton | 2,406.64 | 2,654.55 | -9.34% |
Production volume | Ton | 2,616.66 | 2,856.66 | -8.40% | |
Inventory volume | Ton | 839.15 | 629.13 | 33.38% |
Reasons for any over 30% YoY changes in the data above.
√ Applicable □N/A
The inventory of red wine increased by 33.38% year-on-year, mainly due to the increase in stocking at the end ofthe year.
(4) Execution of significant sales contracts and significant purchase contracts in the reporting period
□Applicable √ N/A
(5) Breakdown of cost of sales
By business and product segment
Unit:CNY
By business segment | Item | 2022 | 2021 | YoY change | ||
Amount | As a percentage of cost of sales | Amount | As a percentage of cost of sales | |||
Liquor | 7,214,917,301.54 | 94.37% | 5,702,863,048.47 | 91.17% | 26.51% |
Unit:CNY
By product segment | Item | 2022 | 2021 | YoY change | ||
Amount | As a percentage of cost of sales | Amount | As a percentage of cost of sales | |||
Liquor | Direct materials | 5,402,139,505.20 | 70.66% | 4,128,993,712.95 | 66.01% | 30.83% |
Liquor | Direct labor | 1,240,006,256.85 | 16.22% | 1,085,084,143.74 | 17.35% | 14.28% |
Liquor | Fuels and energy | 288,774,712.57 | 3.78% | 235,359,439.08 | 3.76% | 22.70% |
Liquor | Manufacturing overhead | 283,996,826.92 | 3.71% | 253,425,752.70 | 4.05% | 12.06% |
Note: Nil
(6) Changes in the scope of the consolidated financial statements for the reporting period
√ Applicable □ N/A
Establishment of subsidiariesIn March 2022, the company jointly invested CNY400 million with Tibet Earth Third Pole Industry DevelopmentCo., Ltd., Lhasa Pure Land Industry Investment and Development Group Co., Ltd. and Shenzhen Baoneng FoodTechnology Group Co., Ltd. to establish Tibet Earth Third Pole Wine Co., Ltd., of which the company contributedCNY204 million, accounting for 51% of its registered capital; Tibet Earth Third Pole Industry Development Co., Ltd.invested CNY72 million, accounting for 18% of its registered capital; Lhasa Pure Land Industry Investment andDevelopment Group Co., Ltd. invested CNY64 million, accounting for 16% of its registered capital; ShenzhenBaoneng Food Technology Group Co., Ltd. invested CNY60 million, accounting for 15% of its registered capital. Itwill be included in the consolidated financial statements as of March 2022.
In August 2022, Guizhou Maotai Town Guijiu Liquor Co., Ltd., a holding subsidiary, invested CNY500,000 toestablish Guizhou Guijiu Liquor Operation Co., Ltd., accounting for 100% of its registered capital. It has beenincluded in the consolidated financial statements since August 2022.
In August 2022, the company subscribed to contribute CNY10 million to establish Jiangsu Azure BeverageCatering Management Co., Ltd., accounting for 100% of its registered capital. It has been included in theconsolidated scope of consolidated financial statements since August 2022.
In August 2022, the company subscribed to contribute CNY300,000 to establish Jiangsu Yanghe DreamInvestment Management Co., Ltd., accounting for 100% of its registered capital. It has been included in theconsolidated scope of consolidated financial statements since August 2022.
In September 2022, Jiangsu Yanghe Dream Investment Management Co., Ltd., a holding subsidiary, investedCNY10 million to establish Jiangsu Yanghe Blue Investment Management Co., Ltd., accounting for 100% of itsregistered capital. It has been included in the consolidated scope of the consolidated financial statements sinceSeptember 2022.
Subsidiary deregistrationIn September 2022, Jiangsu Collite Biotechnology Research Institute Co., Ltd., a holding subsidiary, was cancelledand no longer be included in the consolidated scope of the consolidated financial statements from October 2022.
In November 2022, Guizhou Guijiu Liquor Operation Management Co., Ltd., a holding subsidiary, was liquidatedand cancelled, and it was no longer be included in the consolidated scope of consolidated financial statementsfrom December 2022.
(7) Major changes in the business, products or services in the reporting period
□Applicable √ N/A
(8) Main customers and suppliers
Sales to major customers of the Company
Total sales from top five customers(CNY) | 1,540,457,955.89 |
Total sales from top five customers as a percentage of the total sales | 5.12% |
Total sales from related parties among top five customers as a percentage of the total sales | 0.00% |
Information on top five customers
No. | Customer | Sales amount (CNY) | As a percentage of the total sales for the year |
1 | Customer A | 588,069,044.59 | 1.95% |
2 | Customer B | 402,484,131.99 | 1.34% |
3 | Customer C | 206,297,498.54 | 0.69% |
4 | Customer D | 186,249,231.90 | 0.62% |
5 | Customer E | 157,358,048.87 | 0.52% |
Total | -- | 1,540,457,955.89 | 5.12% |
Other information on major customers
□Applicable √ N/A
Major suppliers of the Company
Total purchase from top five suppliers(CNY) | 1,229,265,656.40 |
Total purchase from top five suppliers as a percentage of the total sales | 17.53% |
Total purchase from related parties among top five suppliers as a percentage of the total purchase | 0.00% |
Information on top five suppliers
No. | Supplier | Purchases (CNY) | As a percentage of the total purchase for the year |
1 | Supplier A | 318,985,299.80 | 4.55% |
2 | Supplier B | 299,114,671.69 | 4.27% |
3 | Supplier C | 241,445,673.66 | 3.44% |
4 | Supplier D | 191,627,795.08 | 2.73% |
5 | Supplier E | 178,092,216.17 | 2.54% |
Total | -- | 1,229,265,656.40 | 17.53% |
Other information on major suppliers
□Applicable √ N/A
3. Expense
Unit:CNY
2021 | 2020 | YoY change | Reason for any significant change | |
Selling and distribution expenses | 4,179,140,807.85 | 3,544,364,889.54 | 17.91% | |
General and administrative expenses | 1,935,673,295.75 | 1,830,080,139.18 | 5.77% | |
Finance expenses | -636,470,105.91 | -399,145,509.96 | -59.46% | The increase in time deposits was due to a corresponding increase in interest income on deposits. |
R&D expenses | 253,574,976.39 | 258,458,102.63 | -1.89% |
The company shall comply with the disclosure requirements of food and wine manufacturing businesses in SelfRegulatory Guidelines for Listed Companies in Shenzhen Stock Exchange No. 3 - Industry Information Disclosure
The composition of selling and distribution expenses
Unit:CNY
Item | Current period amount | As a percentage of selling and distribution expenses | Previous period amount | As a percentage of selling and distribution expenses | YoY change |
Advertising andpromotionexpense
Advertising and promotion expense | 2,414,204,544.39 | 57.77% | 1,911,827,032.90 | 53.94% | 26.28% |
Payroll | 1,177,066,920.45 | 28.17% | 1,065,844,674.57 | 30.07% | 10.44% |
Travel expense
Travel expense | 433,273,104.21 | 10.37% | 390,432,690.88 | 11.02% | 10.97% |
Labor expense | 47,961,453.63 | 1.15% | 88,722,961.18 | 2.50% | -45.94% |
E-commerce expense | 33,851,096.47 | 0.81% | 37,801,331.20 | 1.07% | -10.45% |
Other expense | 72,783,688.70 | 1.74% | 49,736,198.81 | 1.40% | 46.34% |
Subtotal
Subtotal | 4,179,140,807.85 | 100.00% | 3,544,364,889.54 | 100.00% | 17.91% |
Composition of advertising costs:
Unit:CNY
Item | Current period amount | As a percentage of advertising expense |
Nationwide advertising expense
Nationwide advertising expense | 1,079,779,124.66 | 84.07% |
Regional advertising expense | 204,531,402.15 | 15.93% |
Total | 1,284,310,526.81 | 100% |
4. R&D input
√ Applicable □ N/A
Name of main R & D projects | Purpose | Progress | Objectives to be achieved | Expected impact on future development |
Research and application of microecological regulation technology based on flavor enhancement of Daqu characteristics | Optimize production processes and flavor profiles. | Successfully promoted and applied in September 2022. | 1. Clarify the characteristic flavor system of Daqu and its microecological formation mechanism; 2. Optimize the fermentation factors of key flora growth and metabolism; 3. Build a targeted regulation technology for microbiota optimization and | 1. The production process is continuously optimized to meet the demand for high quality; 2. Continuously enrich the application results of microorganisms in winemaking production, and improve the adaptability of Daqu and winemaking |
flavorimprovement.
flavor improvement. | production. | |||
Research on young, personalized and fashionable products | Provide young consumers with fashionable, healthy and personalized new wine products. | Successfully developed in November 2022. | 1. Determine product positioning according to the consumption trend of young consumers; 2. Develop 2 kinds of fashionable and personalized fruit wine and 2 kinds of healthy and healthy dew wine, and form a supporting process. | Complete the technical reserve of new tasting drinks other than liquor, providing support and assistance for the company's diversification strategy. |
Research on the quality differences of raw wine and the key ingredients of typical characteristics | Analyze the reasons for the difference in taste between different original sake. | The milestone target will be completed in December 2022 and is expected to be completed in November 2023. | 1. Build a comprehensive information database; 2. Analyze the taste differences of different types of original wine. | The output of raw wine with different taste characteristics is controlled from the perspective of production, which provides an important theoretical basis for the precision of auxiliary production process. |
Interaction study of brewing environment micro-ecosystem | In order to analyze the composition of the brewing environment microecology in the summer and autumn production areas, and to elaborate the interaction between environmental microecology and winemaking production. | The phased target will be completed in December 2022 and is expected to be completed in December 2023. | 1. Analyze the composition and evolution of the brewing environment and brewing process microbial community in the summer and autumn production area; 2. Clarify the interaction between summer and autumn brewing microecology and brewing production. | It provides support for the analysis of the microecological structure of the liquor brewing environment and the formation mechanism of brewing in the production area. |
Information about R&D personnel
2022 | 2021 | YoY change | |
Number of R&D personnel | 587 | 575 | 2.09% |
R&D personnel as a percentage in total employees | 2.99% | 3.20% | -0.21% |
Educational background of R & D personnel | |||
Bachelor degree | 155 | 156 | -0.64% |
Master degree
Master degree | 59 | 54 | 9.26% |
Age of R & D personnel | |||
Under 30 | 51 | 58 | -12.07% |
Between 30 and 40 | 343 | 340 | 0.88% |
Information about R&D input
2022 | 2021 | YoY change | |
R&D input (CNY) | 260,555,532.15 | 270,723,001.71 | -3.76% |
R&D input as a percentage in operating revenues | 0.87% | 1.07% | -0.20% |
Capitalized R&D input (CNY) | 6,980,555.76 | 12,264,899.08 | -43.09% |
Capitalized R&D input percentage in total R&D input | 2.68% | 4.53% | -1.85% |
Reasons and effects of YoY change in the composition of R & D personnel.
□Applicable √ N/A
Reasons for any significant YoY change in the ratio of the R&D input to the operating revenues.
□Applicable √ N/A
Reasons for any significant YoY change in the ratio of the R&D input to the operating revenues.
√ Applicable □ N/A
The capitalized amount of R&D investment in the reporting period decreased by 43.09% compared with thesame period of the previous year, mainly due to the decrease in technology R&D equipment purchased in thecurrent period.
5. Cash flow
Unit:CNY
Item | 2022 | 2021 | YoY change |
Subtotal of cash inflows from operating activities | 31,441,857,596.11 | 37,538,099,673.95 | -16.24% |
Subtotal of cash outflows from operating activities | 27,794,233,643.92 | 22,219,934,193.42 | 25.09% |
Net cash flows from operating activities | 3,647,623,952.19 | 15,318,165,480.53 | -76.19% |
Subtotal of cash inflows from investing activities | 17,687,441,703.96 | 28,170,298,911.57 | -37.21% |
Subtotal of cash outflows from investing activities | 13,670,939,240.42 | 26,333,634,597.28 | -48.09% |
Net cash flows from investing activities | 4,016,502,463.54 | 1,836,664,314.29 | 118.68% |
Subtotal of cash inflows from financing activities | 42,800,000.00 | 950,750,000.00 | -95.50% |
Subtotal of cash outflows | 4,534,576,978.60 | 4,498,567,810.77 | 0.80% |
from financing activities
from financing activities | |||
Net cash flows from financing activities | -4,491,776,978.60 | -3,547,817,810.77 | -26.61% |
Net increase in cash and cash equivalents | 3,172,012,990.35 | 13,603,817,188.08 | -76.68% |
Explanation of why the data above varied significantly.
√Applicable □ N/A
Net cash flow from operating activities decreased by 76.19% in the current period compared with the sameperiod of the previous year, mainly due to the decrease in cash received from the sale of goods and services inthe current period, as well as the increase in various taxes and fees paid in the current period.
The net cash flow generated by investment activities increased by 118.68% over the previous period, mainly dueto the decrease in cash paid for investment due to the increase or decrease of wealth management products inthe current period, which was greater than the decrease in cash received from investment recovery, resulting inan increase in net cash flow from investment activities.
The net increase in cash and cash equivalents decreased by 76.68% in the current period compared with thesame period of the previous year, mainly due to the decrease in net cash flow from operating activities in thecurrent period compared with the same period of the previous year.
An explanation of the reasons for the significant difference between the net cash flow generated by theCompany's operating activities and the net profit for the year during the reporting period
√ Applicable □ N/A
The reasons for the large difference between net cash flow and net profit from operating activities was mainlydue to the reduction in contractual liabilities and taxes payable, resulting in a larger decrease in operatingpayables.
5. Analysis of non-core business
√ Applicable □ N/A
Unit:CNY
Amount | As a percentage of total profits | Reasons | Sustainability | |
Investment income | 425,865,631.53 | 3.41% | It is mainly the wealth management income and the investment income of trading financial assets during the holding period | No |
Changes in fair value | -318,331,123.43 | -2.55% | Mainly due to changes in fair value of financial assets held for trading | No |
Assetimpairment
Asset impairment | -2,333,823.54 | -0.02% | provision for stock obsolescence | No |
Non-operating income | 25,586,332.71 | 0.20% | compensation and liquidated damages income | No |
Non-operating expenses | 31,507,701.73 | 0.25% | Mainly due to donation expenses and losses from retirement of fixed assets | No |
6. Analysis of assets and liabilities
1. Significant changes of asset items
Unit:CNY
As at the end of 2022 | As at the beginning of 2021 | Change In percentage | Explanation about any significant changes | |||
Amount | As a percentage of total assets | Amount | As a percentage of total assets | |||
Cash and cash equivalents | 24,375,449,432.33 | 35.87% | 20,955,831,010.12 | 30.91% | 4.96% | |
Accounts receivable | 45,142,892.78 | 0.07% | 1,247,949.91 | 0.00% | 0.07% | |
Inventories | 17,729,258,966.54 | 26.09% | 16,803,093,441.81 | 24.78% | 1.31% | |
Long-term equity investments | 32,979,630.21 | 0.05% | 32,743,397.31 | 0.05% | ||
Fixed assets | 5,794,773,069.53 | 8.53% | 6,276,466,308.05 | 9.26% | -0.73% | |
Construction in progress | 757,145,492.90 | 1.11% | 525,497,000.26 | 0.78% | 0.33% | |
Right-of-use asset | 34,115,602.27 | 0.05% | 19,610,113.75 | 0.03% | 0.02% | |
Contract liability | 13,741,547,677.99 | 20.22% | 15,804,521,430.17 | 23.31% | -3.09% | |
Long-term borrowings | 36,360.00 | |||||
Lease Liabilities | 3,715,300.93 | 0.01% | 10,729,824.19 | 0.02% | -0.01% |
The proportion of overseas assets is relatively high.
□Applicable √ N/A
2. Assets and liabilities measured at fair value
√ Applicable □ N/A
Unit:CNY
Item | Opening balance | Changes in fair value recognized in profit or loss | Changes in the cumulative fair value recorded into equity | Provision for impairment | Amount of purchase | Amount of sale | Other change s | Closing balance |
Financial Assets | ||||||||
1. Financial assets held for trading (excluding derivative financial assets) | 18,589,836,477.07 | -318,331,123.43 | 13,124,806,086.81 | 17,253,028,374.72 | 3,501,214.21 | 14,146,784,279.94 | ||
Total | 18,589,836,477.07 | -318,331,123.43 | 13,124,869,941.95 | 17,253,028,374.72 | 3,501,214.21 | 14,146,784,279.94 | ||
Financial liabilities | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
Other changesNoWhether measurement attribution of main assets changed significantly during this period
□Applicable √ N/A
3. Restricted asset rights as of the end of this reporting period
No
7. Investment
1. Total investment
√ Applicable □ N/A
Investment made in the reporting period (CNY) | Investment made in the prior year (CNY) | YoY change |
431,849,941.95 | 3,840,110,341.89 | -88.75% |
2. Significant equity investment made in the reporting period
□Applicable √ N/A
3. Significant non-equity investment ongoing in the reporting period
□Applicable √ N/A
4. Investment in financial assets
√ Applicable □ N/A
(1) Securities investment
Unit:CNY
Category of securities | Stock code | Abbr. of securities | Initial investment cost | Accounting measurement model | Opening balance | Changes in fair value recognized in profit or loss | Changes in the cumulative fair value recorded into equity | Amount of purchase | Amount of sale | Profit and loss during the reporting period | Closing balance | Accounting subject | Capital source |
Other | Nil | Shanghai Yunfeng Xincheng Investment Center (L.P.) | 1,176,435,004.02 | Fair value | 1,252,231,763.94 | 75,796,759.92 | 1,176,435,004.02 | Other Non-current financial assets | Owned Fund | ||||
Domestic and foreign stocks | 601696 | BOCI Securities LLC | 300,000,000.00 | Fair value | 1,061,842,099.60 | -227,368,419.84 | 2,842,105.25 | 834,473,679.76 | Other Non-current financial assets | Owned Fund | |||
Other | Nil | Pan Mao (Shanghai) Investment Center (L.P.) | 276,185,376.22 | Fair value | 360,911,196.41 | 33,762,373.80 | 3,226,340.17 | 394,673,570.21 | Other Non-current financial assets | Owned Fund | |||
Other | Nil | CHINA MINSHENG TRUST Co., Ltd. | 650,000,000.00 | Fair value | 585,000,000.00 | -247,000,000.00 | 338,000,000.00 | Other Non-current financial assets | Owned Fund | ||||
Other | Nil | Lianchu Reserve Securities Co., Ltd. | 330,000,000.00 | Fair value | 330,000,000.00 | 330,000,000.00 | Other Non-current financial | Owned Fund |
assets
assets | |||||||||||||
Other | Nil | Jinshi Kunxiang Equity Investment(Hangzhou)Partnership(L.P.) | 208,695,182.50 | Fair value | 258,930,097.01 | 17,596,365.46 | 27,673,591.80 | 248,852,870.67 | Other Non-current financial assets | Owned Fund | |||
Other | Nil | Suzhou Danqing Phase II Innovative Pharmaceutical Industry Investment Partnership (L.P.) | 173,710,818.17 | Fair value | 232,906,944.43 | 15,086,057.90 | 7,885,119.23 | 240,107,883.10 | Other Non-current financial assets | Owned Fund | |||
Domestic and foreign stocks | VSPT | Vina San Pedro | 425,350,132.53 | Fair value | 237,412,110.83 | 2,284,386.60 | 16,081,193.22 | 239,696,497.43 | Other Non-current financial assets | Owned Fund | |||
Other | Nil | Nanjing Xingnahe Venture Capital Partnership (Limited Partnership) | 205,027,500.00 | Fair value | 162,490,000.00 | 50,000,000.00 | 7,462,500.00 | 205,027,500.00 | Other Non-current financial assets | Owned Fund | |||
Other | Nil | CICC Jiatai Phase II (Tianjin) Equity Investment Fund Partnership (L.P.) | 119,096,307.39 | Fair value | 301,532,355.61 | -59,286,322.18 | 41,705,511.69 | 200,540,521.74 | Other Non-current financial assets | Owned Fund | |||
Other securities investments held at the end of this period | 1,630,818,987.17 | -- | 3,459,505,221.46 | 72,839,306.39 | 0.00 | 74,806,086.81 | 1,772,504,892.08 | 128,595,994.95 | 1,838,146,936.79 | -- | -- | ||
Total | 5,495,319,308.00 | -- | 8,242,761,789.29 | -392,086,251.87 | 0.00 | 124,806,086.81 | 1,933,028,374.72 | 150,745,633.59 | 6,045,954,463.72 | -- | -- |
(2) Derivative investments
□Applicable √ N/A
No such cases in the reporting period.
5. Use of fund-raising
□Applicable √ N/A
No such cases in the reporting period.
8. Sale of major assets and equity Interests
1. Sale of major Assets
□Applicable √ N/A
No such cases in the reporting period
2. Sale of major equity Interests.
□Applicable √ N/A
9. Analysis of major subsidiaries
√ Applicable □ N/A
Main subsidiaries and joint companies with an over 10% influence on the Company’s net profit
Unit:CNY
Company name | Company type | Business scope | Registered capital | Total assets | Net assets | Operating revenue | Operating profit | Net profit |
Su Wine Trade Group Limited by Share Ltd. | Subsidiary | Wholesaling and retailing of prepackaged food | 334,400,000.00 | 24,356,255,484.58 | 6,551,117,577.66 | 25,742,788,677.28 | 7,333,596,391.79 | 5,625,339,043.93 |
Jiangsu Shuanggou Distillery Stock Co., Ltd. | Subsidiary | Production and sales of Baijiu | 110,000,000.00 | 8,605,549,762.72 | 5,646,892,673.28 | 2,181,426,315.65 | 2,103,043,324.29 | 2,092,249,046.41 |
Jiangsu Shuanggou Liquor Operation Co., Ltd. | Subsidiary | Wholesaling and retailing of prepackaged food | 5,000,000.00 | 3,906,483,280.76 | 1,431,143,783.08 | 5,022,586,319.41 | 1,890,756,493.83 | 1,418,052,154.87 |
Acquisition and disposal of subsidiaries during the reporting period
√ Applicable □ N/A
Subsidiary name | How subsidiary was acquired or disposed during the reporting period | Impact on overall operation and results |
Tibet Earth Third Pole WineIndustry Co., Ltd
Tibet Earth Third Pole Wine Industry Co., Ltd | Establishment | minor |
Guizhou Guijiu Wine Industry Operation Co., Ltd | Establishment | minor |
Jiangsu Azure Drink Catering Management Co., Ltd | Establishment | Tiny |
Jiangsu Yanghe Dream Investment Management Co., Ltd | Establishment | minor |
Jiangsu Yanghe Blue Investment Management Co., Ltd | Establishment | minor |
Jiangsu Collite Biotechnology Research Institute Co., Ltd | Deregistration | Tiny |
Guizhou Guijiu Wine Operation Management Co., Ltd | Deregistration | Tiny |
10. Structured entities controlled by the Company
□Applicable √ N/A
11. Outlook for the future development of the CompanyIndustry situation analysis
1. Industry concentration has been further improved. With the intensification of industry competition and the
enhancement of consumer brand awareness, the trend of liquor market share concentration to the headbrand is becoming more and more obvious, and the industry differentiation continues to intensify. Leadingenterprises with "brand advantages, management advantages, channel advantages, and talent advantages"are more likely to win in the future liquor market competition and seize more market share.
2. The industry competition pattern has gradually formed. In 2022, the competition in the liquor industryintensified, and all liquor companies will continue to innovate and optimize in terms of "products, brands,channels, and marketing models", the development pattern and competition situation of the liquor industryare gradually taking shape, and the competitive advantage of the head brand will continue to be enlarged,and will be further strengthened in the future market competition.
3. The trend of consumption upgrading has become more obvious. In 2022, the liquor output of enterprisesabove designated size was 6.7124 million kiloliters, down 5.58% from the same period of the previous year,and the sales revenue in the same period has steadily increased, and the trend of consumption upgrading isobvious. Consumers pay more attention to brands, the industry has entered the era of "long-term lack ofwine, long-term shortage of good wine", wine companies with strong "brand power and product power" willenjoy more consumption upgrade dividends.
The company's development strategy and business plan
1. Development strategy
During the "14th Five-Year Plan" period, the company adheres to the consumer-centered, double-famousbaijiu as the main body, multi-brand as the pillar, quality-oriented, brand-based, culture as the soul,innovation as the key, builds the "12345" strategic system, creates the Yanghe leading the wave and thesurging power of the double ditch, promotes the continuous growth of the quantity and the steady
improvement of the quality of the enterprise at a higher level, achieves a fuller, more balanced, morehigh-quality and efficient development, Yanghe becomes a Chinese taste that Chinese are proud of and theChinese business card remembered by the world.
2. Business plan for 2023
In 2023, the company will promote the company to achieve higher quality, more sustainable and healthierdevelopment with stronger confidence, and strive to achieve a year-on-year increase in operating income of15%.
(1) Focus on high quality and promote enterprise party building. Adhere to the leadership position of party
building, promote the common development of party building business, strengthen the party's overallleadership, fully clarify the leading role of party building, and take high-level party building as a powerfuldriving force for the high-quality development of enterprises. Adhere to the construction of party styleand clean government as the fundamental guarantee for enterprise development, and continue tocreate a good ecology of "secondary entrepreneurship".
(2) Focus on a high starting point and make another breakthrough to promote the continuous improvementof market construction. Seize the opportunity of brand centralized development, promote theoptimization of regional structure and product structure, vigorously expand leading brands such asHaitian Dream and Zhenbao Fang, and promote the reshaping of brand value of famous wines to achievein-depth coverage of sales channels and consumption scenarios. Based on the integrated construction ofmanufacturers, implement the "1320" strategy, promote the strong business project, rich businessproject, and business support project, improve the operation level of the core distributor market, and laya solid foundation for full market expansion. Strengthen business capabilities and basic management,improve the conference battle and graded training system, pay attention to the assessment of processindicators, and realize the improvement of team, market and distributor management.
(3) Focus on high positioning and re-excellence, and continue to promote brand building. Make full use ofthe company's brand advantages, closely focus on the company's brand development strategy, furtherbuild a hierarchical brand system, establish a clearer brand path, strengthen systematic brand publicity,strengthen market services, and realize the effective linkage of brand communication and marketingexpansion. The company aims to tell the story of brand identity, focus on improving communicationefficiency, expand the high-end media matrix, deepen the expression of quality value, achieve moreefficient brand communication, and promote the vigorous development of the company's brand.
(4) Focus on high requirements and secondary upgrades, and continue to promote product construction.Improve the dynamic product management system, continuously optimize the product structure, realizethe management of the product life cycle through digital technology, and further shape a product linewith clear levels and comprehensive price coverage. Adhere to the original heart, continue to do a goodjob in product quality improvement, characteristic product creation, key topic research, to ensure qualityupgrade. Adhere to market awareness, responsibility awareness, service awareness, continue to improveproduct guarantee level, operation control capabilities, and provide strong guarantee for the market.
(5) Focus on high standards and continue to promote cultural construction. With "dream culture" as the
core and "five dreams linkage" as the connotation, create the humanistic feelings and spiritual beliefs ofYanghe, display the new style of culture, carry out the construction of wine capital in depth with morepragmatic measures, and promote the combination of wine and the city. To further stimulate the vitalityof the organization, with "improving the organizational operation ability and strengthening theorganizational operation level" as the key, build a higher quality and stronger talent team, and at thesame time focus on improving the quality and efficiency of basic management to comprehensively
contribute to the construction of culture.
Possible risks
1. Macroeconomic fluctuation risk. At present, China's economy is recovering in an orderly manner, butthe pressure still exists, coupled with the multiple challenges facing the world economy, liquorconsumption is easily affected by economic fluctuations, which brings greater uncertainty to thedevelopment of the liquor industry.
2. The risk of intensifying market competition. At present, the Matthew effect of the liquor industry isbecoming more and more obvious, the market share continues to be concentrated in famous wineenterprises and head wine enterprises, and the liquor industry has gradually entered a stage ofaccelerated competition, and market competition, especially between famous wine enterprises, will befurther intensified.
3. Risk of changes in market demand. At present, residents' consumption concepts and consumptionbehaviors have undergone great changes, and the upgrading of health concepts, the prominence ofbrand consumption, the growth of online consumption, and the improvement of quality demand havegradually become new consumption trends, which may have a certain impact on the consumptiondemand and consumption of liquor.
12. Visits paid to the Company for research, communication, interview,etc. during the reporting period.
√ Applicable □ N/A
Date of visit | Reception site | Way of visit | Type of visitor | Visitor | The main contents of the discussion and the information provided | Index to main inquiry information |
2022-05-23 | Panorama.com | Other | Other | Investors who participated in the online briefing on the company's 2021 annual results | The company's production, marketing, management, finance, etc | Log Sheet of Investor Relations Activities on 22May 2022 on www.cninfo.com.c n(No:2022- 001 |
2022-05-30 | Headquarter | Field survey | Other | Shareholders and investors who participated in the on-site communication of the company's 2021 annual general meeting | The company's development strategy, management reform, marketing layout, product planning, etc | Log Sheet of Investor Relations Activities on 30May 2022 on www.cninfo.com.c n(No:2022- 002 |
2022-06-29
2022-06-29 | Headquarter | Field survey | Institution | 5 investors from CITIC Securities, Ruiquan Capital, WTAM and Changjin Investment | The company's leading product market performance, brand strategy, etc | Log Sheet of Investor Relations Activities on 29June 2022 on www.cninfo.com.c n(No:2022- 003 |
2022-09-27 | Headquarter | Field survey | Institution | 2 investors from BOCOM Schroders Fund | The company's product matrix, channel reform, marketing reform, brand building, medium and long-term development planning, etc | Log Sheet of Investor Relations Activities on 27 Sep 2022 on www.cninfo.com.c n(No:2022- 004 |
Section IV CORPORATE GOVERNANCE
1. Basic Situation of Corporate Governance
The company strictly follows the "Company Law", "Securities Law", "Governance Guidelines for ListedCompanies", "Shenzhen Stock Exchange Listing Rules" and other laws, administrative regulations, departmentalrules and normative documents. Combining the actual development of the company, the company constantlyimproves its modern enterprise system and corporate governance structure. During the reporting period, theoverall operation of the company was standardized and complied line with the governance requirements oflisted companies.
1.1 Shareholders and shareholders’ meetings
The responsibilities of the company's general meeting of shareholders are clear, with accurate rules ofprocedure and practical implementation. The calling, convening and deliberation procedures of the company'sgeneral meeting of shareholders comply with the relevant provisions of the Company Law, the Articles ofAssociation and the Rules of Procedure for the General Meeting of Shareholders of the Company. Allshareholders are treated equally, especially to ensure that small and medium shareholders enjoy equal statusand ensure that small and medium shareholders can sufficiently exercise its own rights. The board of directors ofthe company earnestly implemented the resolutions of the general meeting of shareholders.
1.2 Directors and Board of directors
The responsibilities of the board of directors of the company are clear, and all directors can perform theirduties conscientiously. The board of directors of the company elects directors in strict accordance with theselection and appointment procedures stipulated in the Company Law and the Articles of Association. The boardof directors of the company currently consists of 8 directors, 4 of which are independent directors. Thecomposition of the board of directors conforms to the requirements of laws and regulations. The board ofdirectors of the company strictly complies with the "Company Law", "Articles of Association" and other relevantregulations to regulate the deliberation and operation of the board of directors. All directors of the company canattend the board of directors in accordance with the "Procedure Rules of the Board of Directors", "WorkingSystem for Independent Directors" and other regulations, diligently and conscientiously review each case,making scientific and reasonable decisions on major issues of the company, and earnestly safeguarding theinterests of the company and the legitimate rights and interests of all shareholders. The company's board ofdirectors consists of four professional committees, namely the strategy committee, the nomination committee,the audit committee and the remuneration and appraisal committee. Each committee has a clear division oflabor, powers and responsibilities, and gives full play to its professional functions, providing scientific andprofessional opinion for the decision-making of the board of directors.
1.3 Supervisors and Board of Supervisors
The company's board of supervisors has clear responsibilities, and all supervisors can conscientiously andresponsibly perform their duties. The board of Supervisors of the company election is in strict accordance withthe recruitment procedures stipulated in the Company Law and the Articles of Association and etc. The board ofsupervisors of the company is composed of 5 supervisors, among which 2 are employees' representatives. Thecomposition of the members of the board of supervisors meets the requirements of laws and regulations. The
board of supervisors operates in strict accordance with the company law, the company's articles and otherregulations, the supervisors can attend the board requested by the rules of procedure of the board ofsupervisors, earnestly perform their duties, effectively supervising and expressing opinions on the major issuesof the company, financial status, and how the directors and President perform. Safeguarding the legitimate rightsand interests of the company and shareholders is also the duty of the board of supervisors.
1.4 Performance appraisal and incentive and restraint mechanism
The appointment of the company's directors, supervisors and senior management personnel is open andtransparent, in line with relevant laws and regulations, and a fair and transparent management performanceevaluation standard and incentive and restraint mechanism have been established. During the reporting period,the company conducted a performance appraisal on the goals set by the executive suites in accordance with theannual business plan, and all the executive suites have conscientiously performed their duties.
1.5 Performance appraisal and incentive and restraint mechanism
The controlling shareholder of the company shall exercise the rights of the investor and take the obligations instrict accordance with the requirements of the Company Law. The company and the controlling shareholder shallseparate personnel, assets and finances, with independent organization and business, accounting independentlyand taking responsibilities and risks independently. During the reporting period, the controlling shareholder didnot directly or indirectly interfere with the company's decision-making and business activities beyond thecompany's general meeting of shareholders, and there was no situation where the controlling shareholderharmed the legitimate rights and interests of other shareholders of the company. There is no major relatedtransaction between the company and its controlling shareholder, there is no phenomenon that the controllingshareholder occupies the funds of the company, and the company does not provide guarantees for thecontrolling shareholder and its subsidiaries.
1.6 Investor relations activities
The company pays great attention to the management of investor relations and actively safeguards thelegitimate rights and interests of the company's shareholders. In addition to performing information disclosureobligations diligently and honestly, the chairman, president and secretary of the board of directors maintainpositive interactions with investors by receiving investor surveys, participating in online performance briefingsand brokerage strategy meetings, etc. The securities department acting as a specialized relationshipmanagement agency, strengthens communication with investors through telephone, email, interactive and othermethods, fully guaranteeing the investors' right to know, and safeguarding their legitimate rights and interests.
1.7 Stakeholders, environmental protection, social responsibility
The company fulfills its social responsibility obligations in accordance with the requirements of socialresponsibility, fully respects and safeguards the legitimate rights and interests of relevant stakeholders, realizesthe coordination and balance of the interests of the society, government, shareholders, the company, employeesand other parties, and jointly promotes the harmonious and stable development of the company. The companyadvocates the governance concept of ‘green brewing, ecological enterprise’, integrates ecological andenvironmental protection requirements into the company's development strategy and corporate governanceprocess. While maintaining the sustainable development, the company actively participates in social welfareundertakings and practices social responsibility.
1.8 Information disclosure and transparency
In strict accordance with the requirements of the regulatory authorities, the company earnestly implementsthe "Information Disclosure Management System", "Investor Relations Management System" and others,strengthens the management of information disclosure affairs, and earnestly fulfills its information disclosureobligations in accordance with the law, and discloses truthfully, accurately, completely, timely and fairly.information, ensuring that all shareholders have equal access to information.
1.9 Continue to improve the internal management system
The company continues to improve the internal control system, further strengthen corporate governance, sothat the level of corporate governance has been further improved. The audit committee of the companycomprehensively reviews and supervises the effectiveness of the company's financial reporting, internal controland corporate governance. As an internal audit unit, the company's audit center conducts routine andcontinuous supervision and inspection for the improvement and implementation of the internal control system,timely discovers and improves the deficiencies of internal control, ensures the effectiveness of internal control,and improves the company's operation and management level and risk prevention ability.
Is the actual situation of corporate governance significantly different from laws, administrative regulations andregulations on listed company governance issued by the CSRC?
□ Yes √ No
The actual situation of corporate governance is not significantly different from laws, administrative regulationsand regulations on listed company governance issued by the CSRC.
2. Company’s Independence in Assets, Personnel, Finances, Organizations and Businessesfrom Controlling Shareholders and Actual Controller
The company has a complete independent production and management system, and independentdecision-making management ability, covering business, personnel, assets, organizations and finance fiveaspects.
2.1 For business aspect
The company's business structure is independent and complete, with the ability to independently face themarket and operate independently. There is no horizontal competition with the controlling shareholder, and thecontrolling shareholder does not directly or indirectly interfere with the company's operations.
2.2 For personnel aspect
The company has established an independent personnel and wage management system, and signed a "laborcontract" with employees. The chairman, president, vice president, chief financial officer and secretary of theboard of directors of the company receive remuneration from the company, but do not receive remunerationfrom the controlling shareholder. The directors, supervisors and senior management of the company do not holdpositions prohibited by laws and regulations in other companies with the same or similar business as thecompany.
2.3 For assets aspect
The company has a clear property relationship with the controlling shareholder, has independent land userights and housing property rights, and independently registers, builds accounts, accounts and managescompany assets. The controlling shareholder has not occupied or dominated the company's assets or interferedwith the company's operation and management of the assets.
2.4 For organization aspect
The company has a mature organizational system. The general meeting of shareholders, the board of directors,the board of supervisors, the management and each functional department operate independently, and acorresponding internal management and control system has been formulated, so that the division of laboramong each department is clear, and each department performs its own duties. The cooperation with each otherforms an organic whole, which ensures the legal operation of the company, and there is no subordinationrelationship with the controlling shareholder's functional department.
2.5 For finance aspect
The company has a complete and independent financial institution, equipped with sufficient full-time financialaccounting personnel, established an independent accounting system and financial management system, andindependently opened bank accounts, paid taxes, and made financial decisions independently. The controllingshareholder does not intervene in the financial management of the company.
3. Competition in the same industry
□ Applicable √ N/A
4. Annual general meeting and extraordinary general meeting held during the reportingperiod
4.1 Shareholders' general meeting during the reporting period
Which Session | Type | Investor Participation Ratio | Open Date | Disclose Date | Meeting Outcome |
2021 Annual General Meeting of Shareholders | Annual General Meeting of Shareholders | 76.47% | May 30, 2022 | June 2, 2022 | For details, please refer to the "Announcement on Resolutions of the 2021 Annual General Meeting of Shareholders" disclosed by the company in the statutory information disclosure media (Announcement No.: 2022-013) |
4.2 Preference shareholders with restored voting rights request to convene an extraordinary general meeting
□ Applicable √ N/A
5. Directors, Supervisors and Senior Managers
5.1 Basic situation
Name | Position | Service status | Gender | Age | Term Start Date | Term End Date | Number of shares held at the beginning of the period (shares) | Number of Shares increased in current period (Shares) | Number of Shares decreased in current period (Shares) | Other Increase or decrease changes (shares) | Number of shares held at the end of the period (shares) | Reasons |
Zhang Liandong | chairman | Incumbent | Male | 55 | February 23, 2021 | February 23, 2024 | 0 | 0 | 0 | 0 | 0 | |
Zhong Yu | Vice chairman, President | Incumbent | Male | 59 | February 10, 2015 | February 23, 2024 | 0 | 0 | 0 | 0 | 0 | |
Yang Weiguo | Director | Incumbent | Male | 49 | May 30, 2022 | February 23, 2024 | 0 | 0 | 0 | 0 | 0 | |
Wang Kai | Director | Incumbent | Male | 46 | May 19, 2017 | February 23, 2024 | 2,400 | 0 | 0 | 0 | 2,400 |
ZhaoShuming
Zhao Shuming | Independent Director | Incumbent | Male | 71 | February 23, 2021 | February 23, 2024 | 0 | 0 | 0 | 0 | 0 | |
Nie Yao | Independent Director | Incumbent | Male | 46 | February 23, 2021 | February 23, 2024 | 0 | 0 | 0 | 0 | 0 | |
Lu Guoping | Independent Director | Incumbent | Male | 63 | February 23, 2021 | February 23, 2024 | 0 | 0 | 0 | 0 | 0 | |
Mao Lingxiao | Independent Director | Incumbent | Male | 59 | February 23, 2021 | February 23, 2024 | 0 | 0 | 0 | 0 | 0 | |
Chen Taiqing | Chairman of the Supervisory Board | Incumbent | Male | 58 | July 13, 2020 | February 23, 2024 | 0 | 0 | 0 | 0 | 0 | |
Xu Youheng | Supervisor | Incumbent | Male | 46 | May 23, 2019 | February 23, 2024 | 0 | 0 | 0 | 0 | 0 |
Xu Lili
Xu Lili | Supervisor | Incumbent | Female | 44 | February 23, 2021 | February 23, 2024 | 0 | 0 | 0 | 0 | 0 | |
Chen Fuya | Supervisor | Incumbent | Male | 58 | July 6, 2020 | February 23, 2024 | 0 | 0 | 0 | 0 | 0 | |
Chen Taisong | Supervisor | Incumbent | Male | 55 | February 10, 2015 | February 23, 2024 | 0 | 0 | 0 | 0 | 0 | |
Lin Qing | Vice President | Incumbent | Female | 48 | February 10, 2015 | February 23, 2024 | 0 | 0 | 0 | 0 | 0 | |
Zheng Bujun | Vice President | Incumbent | Male | 56 | February 10, 2015 | February 23, 2024 | 45,000 | 0 | 0 | 0 | 45,000 | |
Yin Qiuming | Vice President, CFO | Incumbent | Male | 51 | July 13, 2020 | February 23, 2024 | 0 | 0 | 0 | 0 | 0 | |
Li Yuling | Vice President | Incumbent | Male | 53 | July 13, 2020 | February 23, 2024 | 0 | 0 | 0 | 0 | 0 |
LuHongzhen
Lu Hongzhen | Board Secretary | Incumbent | Female | 45 | February 23, 2021 | February 23, 2024 | 0 | 0 | 0 | 0 | 0 | |
Liu Huashuang | Director, Executive President | Leaving office | Male | 53 | January 29, 2018 | February 24, 2023 | 0 | 0 | 0 | 0 | 0 | |
Cong Xuenian | Director | Leaving office | Male | 57 | February 10, 2015 | September 30, 2022 | 2,778,291 | 0 | 0 | 0 | 2,778,291 | |
Zhou Xinhu | Director, Vice President, | Leaving office | Male | 61 | February 10, 2015 | September 7, 2022 | 2,878,291 | 0 | 0 | 0 | 2,878,291 | |
Fu Hongbing | Vice President, | Leaving office | Male | 61 | January 17, 2020 | January 8, 2022 | 0 | 0 | 0 | 0 | 0 |
Total
Total | -- | -- | -- | -- | -- | -- | 5,703,982 | 0 | 0 | 0 | 5,703,982 | -- |
During the reporting period, is there any resignation of directors and supervisors and dismissal of senior managers during their term of office?
√ Applicable □ N/A
During the reporting period, Mr. Cong Xuenian resigned as a director for personal reasons.Mr. Zhou Xinhu and Mr. Fu Hongbing retired.
Changes in directors, supervisors and senior management of the company
√ Applicable □ N/A
Name | Position | Type | Date | Reasons |
Yang Weiguo | Director | Elected | May 30, 2022 | General election |
Cong Xuenian | Director | Leaving office | September 30, 2022 | Voluntary resignation |
Zhou Xinhu | Director, Vice President | Leaving office | September 7, 2022 | Retirement |
Fu Hongbing | Vice President | Decruitment | January 8, 2022 | Retirement |
5.2 Situation of Employers
The professional background, main work experience and main responsibilities of the current directors,supervisors and senior management of the company
5.2.1 Directors
Mr. Zhang Liandong, born in September 1968, master degree from the Party School, deputy to the NationalPeople's Congress. He successively served as organizational officer and organizational member of the PartyCommittee of Zhikou Township, Suqian City, organizational member and member of the Party Committee ofSucheng Town, Sucheng District, deputy secretary of the Party Working Committee and secretary of theDisciplinary Work Committee of Xingfu Street, Sucheng District, director of sub-district office, secretary of partyWorking Committee of Xiangli Street, Sucheng District, director of the Management Committee and deputysecretary of the Party Working Committee of Sucheng District Economic Development Zone, director of theInvestment Promotion Bureau of Sucheng District, deputy district chief of Sucheng District, and member of theStanding Committee of the Sucheng District Committee, secretary of the Party Working Committee of SuchengEconomic Development Zone, deputy secretary-general of the Suqian Municipal Government, director anddeputy secretary of the Party Group of the Suqian Urban Management Bureau, deputy secretary-general of theSuqian Municipal Government (section level), secretary of the Party Working Committee of the Yanghe NewDistrict of Suqian City. He is currently the company’s secretary and chairman of the party committee, chairman ofJiangsu Shuanggou Wine Co., Ltd., chairman of Sujiu Group Trading Co., Ltd., and executive director of JiangsuShuanggou Wine Sales Co., Ltd.
Mr. Zhong Yu, born in May 1964, master degree, Chinese Brewmaster, a master of Chinese liquor, a seniorengineer, and a representative of the 14th Jiangsu Provincial People's Congress. He successively served as thedirector of the technical department, the director of the environmental protection department, and the directorof the technology center of Jiangsu Shuanggou Winery; the deputy chief engineer, assistant to the generalmanager, brewing director, assistant to the president, vice president, general manager of Yanghe Co., Ltd. Siyangbranch. He is currently the deputy secretary of the party committee, vice chairman and president of the company,and he is the general manager of Yanghe Branch as well.
Mr. Yang Weiguo, born in February 1974, bachelor degree and master degree. He has served as StandingCommittee member of Siyang County Party Committee, Minister of Publicity Department, member of PartyLeading Group of County government, deputy county head, deputy secretary-general of Suqian Municipal PartyCommittee, deputy director of Suqian Reform Office, Party Secretary and President of Suqian Daily. He iscurrently secretary of the party committee and chairman of Suqian Industrial Development Group Co., LTD.,chairman of Jiangsu Yanghe Group Co., LTD., and chairman of Jiangsu Shuanggou Group Co., LTD.
Mr. Wang Kai, born in August 1977, bachelor degree, intermediate economist. He has served as the managerof the brand department of the Marketing Center of Shanghai Tobacco Group Co., Ltd., and the assistant to thegeneral manager of Shanghai Haiyan Logistics Development Co., Ltd. He is currently the director of the companyand the deputy general manager of Shanghai Haiyan Logistics Development Co., Ltd.
Mr. Zhao Shuming, born in December 1952, Ph.D. He has served as staff member, deputy section chief,section chief, deputy director (presiding over the work) of Nanjing University Foreign Affairs Office, assistant tothe president, then he worked as the associate professor, professor, distinguished professor, senior professor,vice dean and dean of Nanjing University Business School, Nanjing Shenghe Pharmaceutical Co., Ltd.Independent director of Industrial Co., Ltd. and independent director of JSTI Group Co., Ltd. He is currently anindependent director of the company, a senior professor/doctoral supervisor of Nanjing University, the honorarydean of the Business School, the dean of the Xingzhi Academy, and concurrently serves as the vice chairman ofthe Business Administration Professional Education Steering Committee of the Ministry of Education, the vicechairman of the China Management Modernization Research Association, and the vice president of China HumanResource Development Research Association, distinguished adjunct professor of Missouri-St. Louis University,visiting professor of Drucker School of Management, Claremont Graduate University, California, lifetime honorarypresident of Jiangsu Human Resources Society, Lianfa, independent director of Lianfa Co., Ltd., and Nanjingsecurities Co., Ltd.
Mr. Nie Yao, born in June 1977, Ph.D. He has served as a visiting scholar at the Advanced Biotechnology andMedical Center of Rutgers University (State University of New Jersey), an associate professor at the School ofBioengineering, Jiangnan University, and an independent director of Jinhui Liquor Co., Ltd. He is currently anindependent director of the company, subdean and professor of the School of Bioengineering, JiangnanUniversity.
Mr. Lu Guoping, born in March 1960, bachelor degree, professor of accounting, CICPA, outstanding educatorin Jiangsu Province. He has successively served as lecturer, associate professor, director of teaching and researchsection of the School of Engineering of Nanjing Agricultural University, and independent director of LongboSealing Technology Co., Ltd., Huaxin New Materials Co., Ltd. Currently he is the independent director of YangheDistillery, the deputy dean, professor and master tutor of the National Wealth Auditing College of Nanjing AuditUniversity, the person in charge of the national excellent online open course "Advanced Financial Accounting"and the national first-class Head of the undergraduate course "Advanced Financial Accounting", director ofLangbo Sealing Technology Co., Ltd, independent director of Huaxin New Materials Co., Ltd and Baosheng Co.,Ltd.
Mr. Mao Lingxiao, born in January 1964, bachelor’s degree, first-class lawyer (Senior professional title). Hehas served as a staff member of the Jiangsu Provincial Department of Justice, a full-time lawyer of JiangsuInternational Economic and Trade Law Firm, a senior partner and director of Jiangsu Lingxiao Law Firm, a seniorpartner of Jiangsu Jinding Law Firm, and a senior partner and director of Jiangsu Tianzhe Law Firm. Full-timelawyer, senior partner and executive director of Beijing Zhongyin (Nanjing) Law Firm. He is currently anindependent director of the company, a full-time lawyer, senior partner and chairman of the partner meeting ofBeijing Haotianxinhe (Nanjing) Law Firm.
5.2.2 Supervisors
Mr. Chen Taiqing, born in May 1965, holds a master degree, a senior political engineer, and a member of theCommunist Party of China. He successively served as member of the party committee, director of the companyoffice, member of the party committee of the company, director of the company office, director of the humanresources department, director of the general department, assistant to the president, and deputy generalmanager of Yanghe Branch, deputy secretary of the party committee and secretary of the disciplinary committeeof the company , secretary of the party committee and general manager of Shuanggou Wine Industry. He iscurrently the deputy secretary of the party committee, chairman of the supervisory committee and chairman ofthe labor union.
Mr. Xu Youheng, born in March 1977, master’s degree, senior political engineer and member of CommunistParty of China. He successively served as the director of the organization department, the director of the cadresupervision department, the director of the cadre education department, and the director of the office of theOrganization Department of the Suqian Municipal Party Committee, the deputy director of the office of the partyconstruction leading group of the Suqian Municipal Party Committee, and the deputy secretary and deputygeneral manager of the party committee of Suqian Industrial Development Group Co., Ltd. He is currently asupervisor of the company, deputy secretary of the party committee and chairman of the supervisory committeeof Suqian Industry Development Group Co., Ltd.
Ms. Xu Lili, born in March 1979, bachelor's degree. She has successively served as the secretary of the YouthLeague Committee of Shanghai Jieqiang Tobacco Sugar and Wine (Group) Co., Ltd., deputy manager of themarketing department of Shanghai Jieqiang tobacco, Sugar and Wine Group, deputy general manager ofShanghai Qinzhou Trading Co., Ltd., assistant general manager of Shanghai Jieqiang Tobacco Sugar and WineGroup Distribution Center, deputy General Manager, executive deputy general manager and general manager ofShanghai Jieqiang Tobacco Sugar (Group) Chain Co., Ltd. Currently she is the company's supervisor, deputygeneral manager of Shanghai Jieqiang tobacco Sugar (Group) Co., Ltd., general manager of Shanghai JieqiangTobacco Sugar and Wine Group Dignation Co., Ltd., and general manager of Shanghai Jieqiang Food Sales Co.,Ltd.
Mr. Chen Fuya, born in November 1965, bachelor's degree. He has successively served as the member of theStanding Committee of the Discipline Inspection Commission of Suqian and the director of the party style andclean government. He is currently the Deputy Secretary of the Party Committee, Secretary of the DisciplineInspection Commission, and Supervisor.
Mr. Chen Taisong, born in January 1968, master’s degree. He has successively served as a member andsecretary of the Legislative Bureau of Siyang County Government, Secretary of the Office of the Siyang CountyGovernment Office, Deputy Section Chief, Section Chief, Director Assistant, Deputy Director, Siyang County Chiefof Chuancheng Town, Secretary of the Party Committee, Jiangsu Sujiu Industrial Co., Ltd. Deputy Secretary,Secretary of the Discipline Inspection Commission, Chairman of the Supervisory Board, Deputy Secretary of theDiscipline Inspection Commission, Standing Committee of the Party Committee and Organization Minister of thecompany, Deputy Secretary of the Party Committee of Sujiu Group Trading Co., Ltd., Secretary of the DisciplineInspection Commission, and Chairman of the Supervisory Board. He is currently a member of the StandingCommittee of the Party Committee, Supervisor, Chairman of Guijiu Co., Ltd.
5.2.3 Executives
Mr. Zhong Yu, President of the company, the same resume as above.
Ms. Lin Qing, born in May 1975, master's degree, senior accountant and certified public accountant. Shesuccessively served as deputy director of the Enterprise Division of Suqian Finance Bureau of Jiangsu Province,assistant to the director of the Municipal Price Bureau, member and deputy director of the Suqian PartyCommittee of the Municipal Development and Reform Commission, member of the Standing Committee of theParty Committee of the company, and vice president of the company. She is currently a member of the StandingCommittee of the company's party committee, vice president, head of the internal audit organization, and vicechairman of Sujiu Group Trading Co., Ltd.
Mr. Zheng Bujun, born in January 1967, MBA's degree, senior engineer. He successively served as thegeneral manager of Jiangsu Yanghe Group Co., Ltd., the general manager of Suqian State-owned Investment Co.,Ltd., the deputy general manager of Jiangsu Shuanggou Wine Co., Ltd., the procurement and logistics director ofYanghe Co., Ltd., and the assistant to the president. He is currently a member of the standing committee of thecompany's party committee, vice president, secretary of the party committee and general manager of thecompany's Siyang branch.
Mr. Yin Qiuming, born in July 1972, college's degree, auditor. He successively served as Assistant to theDirector of Audit, Director of Audit, Deputy Secretary of the Disciplinary Committee of Jiangsu Yanghe Group Co.,Ltd., Director of the Company's Management Department, Deputy General Manager of Jiangsu Yanghe Sales Co.,Ltd., Deputy General Manager, Party Committee Member, Financial Officer of Jiangsu Yanghe Wine Co., Ltd.Minister, company supervisor, deputy secretary of the Disciplinary Committee, deputy general manager of thecompany's Yanghe branch, finished product scheduling director, financial director, financial director, and generalmanager of the financial center. He is currently the vice president and CFO of the company.
Mr. Li Yuling, born in December 1970, master's degree in MBA from Nanjing University, intermediateeconomist. He successively served as the assistant to the director of the supply department, the assistant to thedirector of the finance department, the deputy chief dispatcher of the general dispatching room, the director ofthe supply department, the director of the company's supply department, the assistant to the general managerof Yanghe Branch, the director of procurement and logistics, and the director of supply chain management inJiangsu Yanghe Group Co., Ltd. , Deputy Director and Office Director of the Procurement and Supply LogisticsCenter. He is currently the vice president of the company, secretary of the party committee and general managerof Jiangsu Shuanggou Wine Co., Ltd.
Ms. Lu Hongzhen, born in October 1978, bachelor's degree,the member of the China Association for thePromotion of Democracy. She has obtained the qualification certificate for board secretary issued by ShenzhenStock Exchange. She joined Jiangsu Yanghe Group Co., Ltd. in September 2001 and served as the secretary of theoffice, deputy director of the general department, deputy director of the company office, deputy director of thesecurities department, and representative of securities affairs of Yanghe Co., Ltd. She is currently the secretary ofthe company's board of directors and the general manager of the Human Resource Center, Director of SecuritiesDepartment.
Positions in shareholder corporations
√ Applicable □ N/A
Name of employee | Shareholder name | Position held in the shareholder company | Term start date | Term end date | Whether to receive remuneration |
allowance inthe shareholdercompany
allowance in the shareholder company | |||||
Yang Weiguo | Jiangsu Yanghe Group Co., Ltd | Chairman | January 18, 2022 | NO | |
Wang Kai | Shanghai Haiyan Logistics Development Co., Ltd. | Vice General Manager | March 1, 2017 | YES | |
Xu Youheng | Jiangsu Yanghe Group Co., Ltd | Supervisor | May 25, 2020 | NO | |
Xu Lili | Shanghai Jieqiang Tobacco Sugar & Wine (Group) Co., Ltd. | Vice General Manager | April 1, 2021 | YES | |
Descriptions of Positions in shareholder corporations | None |
Employments in other corporations
√ Applicable □ N/A
Name of employee | Other corporation name | Positions held in other companies | Term start date | Term end date | Whether to receive remuneration allowances in other companies |
Yang Weiguo | Suqian Industry Development Group Co., Ltd. | Secretary of the Party Committee, Chairman | January 18,2022 | YES | |
Yang Weiguo | Jiangsu Shuanggou Group Co., Ltd. | Chairman | January 18,2022 | NO | |
Zhao Shuming | Nanjing University | Senior Professor, Doctoral Supervisor | July 6, 2017 | YES | |
Zhao Shuming | Nanjing Securities Co., Ltd. | Independent Director | November 15, 2018 | YES | |
Zhao Shuming | Jiangsu Lianfa Textile Co., Ltd. | Independent Director | May 13, 2020 | YES | |
Zhao Shuming | Jiangsu Human Resources Society | Lifetime Honorary President | September 1, 2021 | NO | |
Zhao Shuming | China Human Resource Development Research Association | Deputy Chairman | September 1, 2010 | NO | |
Zhao Shuming | Professional Education Steering | Deputy Minister | September 1, 2013 | NO |
Committee forBusinessAdministrationDisciplines of theMinistry ofEducation
Committee for Business Administration Disciplines of the Ministry of Education | |||||
Zhao Shuming | China Management Modernization Research Association | Vice Director-general | November 02, 2015 | NO | |
Nie Yao | Jiangnan University | Vice Dean and Professor of Bioengineering Students | June 10, 2020 | YES | |
Lu Guoping | Nanjing Audit University | Deputy Dean and Professor of Guofu Zhongxin College | March 01, 2020 | YES | |
Lu Guoping | Changzhou Langbo Sealing Technology Co., Ltd. | Director | February 22, 2022 | YES | |
Lu Guoping | Baosheng Technology Innovation Co., Ltd. | Independent Director | May 9, 2019 | YES | |
Lu Guoping | Changzhou Academy of Architecture and Technology Co., Ltd. | Independent Director | July 6, 2020 | YES | |
Lu Guoping | Suzhou Lianxun Instrument Co., Ltd. | Independent Director | December 1, 2022 | YES | |
Lu Guoping | Suzhou Tiejin Electromechanical Technology Co., Led. | Independent Director | December 1, 2022 | YES | |
Xu Youheng | Suqian Industry Development Group Co., Ltd. | Deputy Secretary of Party Committee, Chairman of the Supervisory Board | October 16, 2021 | YES | |
Xu Youheng | Suqian City Citizen Card Co., Ltd. | Executive Director | April 19, 2021 | NO | |
Xu Youheng | Suqian International Hotel Co., Ltd. | Executive Director | April 14, 2021 | NO | |
Xu Youheng | Suqian Chufeng Hotel Management Co., Ltd. | Executive Director | July 23, 2021 | NO | |
Xu Youheng | Jiangsu Jingshi Big Data Management Co., Ltd. | Chairman | June 22, 2022 | NO | |
Xu Youheng | Suqian Talent Group Co., Ltd. | Executive Director | November 17, 2022 | NO | |
Xu Youheng | Suqian Human Resources Service Co., Ltd. | Executive Director | November 30, 2022 | NO | |
Xu Lili | Shanghai Jieqiang Tobacco Sugar & Wine Group Distribution Co., Ltd. | General Manager | July 14, 2020 | NO | |
Xu Lili | Shanghai Jieqiang | General Manager | July 14, 2020 | NO |
Food Sales Co., Ltd.
Food Sales Co., Ltd. | |||||
Mao Lingxiao | Beijing Hylands (Nanjing) Law Firm | Full-time lawyer, senior partner, chairman of the partnership meeting | January 1, 2021 | YES | |
Descriptions of Employments in other corporations | None |
Penalties imposed by securities regulators on current and outgoing directors, supervisors and senior managers ofthe company in the past three years
□ Applicable √ N/A
5.3 Remuneration of directors, supervisors and senior managers
Decision-making procedures, basis for determination and actual payment of remuneration for directors,supervisors and senior managers
Decision procedure: The remuneration shall be implemented based on the cases “Adjusting the Allowanceof Independent Directors” approved by the Company's 2020 Annual General Meeting of Shareholders and‘Compensation and Assessment Management Measures for Members of Management Team’ approved by theCompany's 2021 Annual General Meeting of Shareholders.
Determination basis: According to the company's current business situation, reference to the regionaleconomic level, industry and market level.
Actual payment: Paid on time according to the corporate's performance and compensation institutions.
Remuneration of directors, supervisors and senior managers during the reporting period
Unit: CNY10, 000
Name | Position | Gender | Age | Employed or not | Total pre-tax compensation received from the company | Whether to obtain remuneration from related parties of the company |
Zhang Liandong | Chairman | Male | 55 | Incumbent | 191.65 | NO |
Zhong Yu | Vice Chairman, President | Male | 59 | Incumbent | 197.17 | NO |
Yang Weiguo | Board Director | Male | 49 | Incumbent | 0 | YES |
Wang Kai | Board Director | Male | 46 | Incumbent | 0 | YES |
ZhaoShuming
Zhao Shuming | Independent Director | Male | 71 | Incumbent | 10 | NO |
Nie Yao | Independent Director | Male | 46 | Incumbent | 10 | NO |
Lu Guoping | Independent Director | Male | 63 | Incumbent | 10 | NO |
Mao Lingxiao | Independent Director | Male | 59 | Incumbent | 10 | NO |
Chen Taiqing | Chairman of the Supervisory Committee | Male | 58 | Incumbent | 143.19 | NO |
Xu Youheng | Supervisor | Male | 46 | Incumbent | 0 | YES |
Xu Lili | Supervisor | Female | 44 | Incumbent | 0 | YES |
Chen Fuya | Supervisor | Male | 58 | Incumbent | 144.58 | NO |
Chen Taisong | Supervisor | Male | 55 | Incumbent | 141.63 | NO |
Lin Qing | Vice President | Female | 48 | Incumbent | 142.15 | NO |
Zheng Bujun | Vice President | Male | 56 | Incumbent | 143.18 | NO |
Yin Qiuming | Vice President, CFO | Male | 51 | Incumbent | 143.9 | NO |
Li Yuling | Vice President | Male | 53 | Incumbent | 143.06 | NO |
Lu Hongzhen | Secretary of the Board | Female | 45 | Incumbent | 66.14 | NO |
Liu Huashuang | Board Director, CEO | Male | 53 | Former | 187.35 | NO |
Cong Xuenian | Board Director | Male | 57 | Former | 12.25 | YES |
Zhou Xinhu | Board Director, Vice President | Male | 61 | Former | 115.18 | NO |
Fu Hongbing | Vice President | Male | 61 | Former | 65.55 | NO |
Total | -- | -- | -- | -- | 1,876.98 | -- |
6. Directors' performance of duties during the reporting period
6.1 The Board of Directors during the Reporting Period
Session | Open Date | Disclose Date | Resolution |
The Eighth Session of the Seventh Board of Directors | April 07,2022 | April 08,2022 | Reviewed and approved the “Proposal on Adjustment of Internal Organizations”. For details, please refer to the “Announcement on Resolutions of the Eighth Session of the Seventh Board of Directors” disclosed by the company in the statutory information disclosure media.( Announcement No.: 2022-003) |
The Ninth Session of the Seventh Board of Directors | April 27,2022 | April 29,2022 | Reviewed and approved the “2021 Annual Work Report of the President”, “2021 Annual Work Report of the Board of Directors”, “2021 Annual Report and Summary”, “ 2021 Annual Financial Final Report”, “ Internal Control Self-Assessment Report”, “Proposal on Renewing the Appointment of Suya Jincheng Certified Public Accountants (Special General Partnership) as the Company's Audit Institution in 2022”, “ 2021 Social Responsibility Report”, “ Proposal on Daily Connected Transactions”, Full Text of the “First Quarterly Report of 2022”, “Plan on Authorizing the Company's Management to Use Its Own Funds to Purchase Financial Products at Opportunities”, “Plan on Formulating Management Measures for Compensation and Assessment of Management Team Members”, “Plan on |
nominating Mr. YangWeiguo as thenon-independentdirector candidate for theseventh Board ofDirectors of theCompany” and “Proposalon holding 2021 AnnualGeneral Meeting ofShareholders”. Fordetails, please refer tothe “Announcement onResolutions of the NinthSession of the SeventhBoard of Directors”disclosed by thecompany in the statutoryinformation disclosuremedia. ( AnnouncementNo.: 2022-005)
nominating Mr. Yang Weiguo as the non-independent director candidate for the seventh Board of Directors of the Company” and “Proposal on holding 2021 Annual General Meeting of Shareholders”. For details, please refer to the “Announcement on Resolutions of the Ninth Session of the Seventh Board of Directors” disclosed by the company in the statutory information disclosure media. ( Announcement No.: 2022-005) | |||
The Tenth Session of the Seventh Board of Directors | August 08,2022 | August 10,2022 | Reviewed and approved the “Proposal on the Establishment of wholly-owned Subsidiaries and Joint Investment with Professional Investment Institutions”. For details, please refer to the “Announcement on Resolutions of the Tenth Session of the Seventh Board of Directors” disclosed by the company in the statutory information disclosure media. ( Announcement No.: 2022-016) |
The Eleventh Session of the Seventh Board of Directors | August 25,2022 | August 27,2022 | Reviewed and approved the full text and abstract of the “2022 Semi-annual Report of the Company”. |
The Twelfth Session of the Seventh Board of Directors | October 27,2022 | October 28,2022 | Reviewed and approved the full text and abstract of “the 2022 Third Quarterly Report of the Company”. |
The Thirteenth Session of the 7th Board of Directors | December 20,2022 | December 21,2022 | Reviewed and approved the “Proposal on Donation to China Aerospace Foundation” and the “Proposal on Donation to Jiangxi Youth Development Foundation”. For details, please refer to the “Announcement on Resolutions of the |
Thirteenth Session of theSeventh Board ofDirectors” disclosed bythe company in thestatutory informationdisclosure media.( Announcement No.:
2022-025)
Thirteenth Session of theSeventh Board ofDirectors” disclosed bythe company in thestatutory informationdisclosure media.( Announcement No.:
2022-025)
6.2 Attendance of Directors at Board of Directors and General Meetings of Shareholders
Attendance of Directors at Board of Directors and General Meetings of Shareholders | |||||||
Name of Directors | The number of times they should attend the board of directors during the reporting period | Number of on-site board attendance | Number of board meetings by means of communication | Number of proxy attendance at the board of directors | Amounts of absences from the Board of Directors | Whether not attended two consecutive board meetings in person | Amounts of attendance at shareholder meetings |
Zhang Liandong | 6 | 5 | 1 | 0 | 0 | NO | 1 |
Zhong Yu | 6 | 5 | 1 | 0 | 0 | NO | 1 |
Liu Huashuang | 6 | 1 | 5 | 0 | 0 | NO | 0 |
Wang Kai | 6 | 0 | 5 | 1 | 0 | NO | 0 |
Yang Weiguo | 4 | 1 | 2 | 1 | 0 | NO | 1 |
Zhao Shuming | 6 | 1 | 5 | 0 | 0 | NO | 0 |
Nie Yao | 6 | 1 | 5 | 0 | 0 | NO | 0 |
Mao Lingxiao | 6 | 0 | 5 | 1 | 0 | NO | 0 |
Lu Guoping | 6 | 1 | 5 | 0 | 0 | NO | 0 |
Cong Xuenian | 4 | 1 | 3 | 0 | 0 | NO | 0 |
Zhou Xinhu | 4 | 3 | 1 | 0 | 0 | NO | 1 |
Explanation of two consecutive absences from attending the board of directors in personN/A
6.3 Circumstances where directors raise objections to company-related matters
Were there any objections on related issues of the Company from directors?
□ Yes √ No
During the reporting period, there is no objections on related issues of the Company from directors.
6.4 Other instructions for directors to perform their duties
Were there any suggestions from directors accepted by the Company?
√ Yes □ No
The statement on whether the director's recommendation to the company's proposal has been adopted or not
During the reporting period, the directors of the Company in accordance with the relevant requirements of“the Company Law”, “the Securities Law”, “the Articles of Association” and other laws, regulations and rules,carried out various work diligently and responsibly, provided reasonable opinions and suggestions for thecompany's business decisions, and effectively safeguarded the interests of the company and all shareholders.
7. The special committees under the board of directors during the reporting period
Committee name | Members | Number of meetings held | Opening date | Content of meeting | Important comments and suggestions | Other performance of duties | Specific circumstances of the objection (if any) |
Strategy Committee | Zhang Liandong, Zhong Yu, Zhao Shuming, Liu Huashuang | 1 | April 26,2022 | Reviewed and approved the “2021 Report on the Work of the Board of Directors” Planned the future development of the company | |||
Nomination Committee | Nie Yao, Zhang Liandong, Mao Lingxiao | 1 | April 25,2022 | Reviewed and approved the “Proposal on the nomination |
of Mr. YangWeiguo asthenon-independentDirector oftheseventhBoard ofDirectorsof theCompany”andqualification review
of Mr. Yang Weiguo as the non-independent Director of the seventh Board of Directors of the Company” and qualification review | |||||||
Remuneration and Appraisal Committee | Zhao Shuming, Nie Yao, Cong Xuenian (Cong Xuenian resigned from the committee on September 30, 2022) | 1 | April 25,2022 | Reviewed the performance of the company's management team members and the implementation of the salary system in 2021 Reviewed and approved the “Management Measures for Salary and Assessment of Management Team Members” | |||
Audit | Lu | 4 | February | Reviewe |
Committee
Committee | Guoping, Cong Xuenian, Mao Lingxiao (Cong Xuenian resigned from the committee on September 30, 2022) | 22,2022 | d accounting firm's audit plan and entry arrangement for 2021 Annual Report,2021 internal audit work and 2022 work plan Reviewed and approved the “Proposal on Renewing the Appointment of Suya Jincheng Certified Public Accountants (Special General Partnership) as the Company's Audit Institution in 2022” | ||||
April 25,2022 | Reviewed the implementation of the audit work of the 2021 annual report. |
Reviewed andapprovedthe “2021InternalControlSelf-AssessmentReport”,“2021AuditReport”,“FinancialFinalAccountsReport of2021”,“Financialandaccountingstatementsfor the firstquarter of2022”,“Proposalon DailyConnectedTransactions”.Reviewed theimplementation ofinternalaudit workin the firstquarter of2022.
Reviewed and approved the “2021 Internal Control Self-Assessment Report”, “2021 Audit Report”, “Financial Final Accounts Report of 2021”, “Financial and accounting statements for the first quarter of 2022”, “Proposal on Daily Connected Transactions”. Reviewed the implementation of internal audit work in the first quarter of 2022. | ||||
August 22,2022 | Reviewed the implementation of internal |
audit workin the firsthalf of2022.
Reviewed andapprovedthe “2022semi-annual FinancialReport”
audit work in the first half of 2022. Reviewed and approved the “2022 semi-annual Financial Report” | ||||
October 25,2022 | Reviewed the implementation of internal audit work in the third quarter of 2022. Reviewed and approved the “Financial Statements for the third quarter of 2022” |
8. Performance of Duties by the Supervisory Committee
Were there any risks to the Company identified by Board of Supervisors when performing its duties during thereporting period?
□ Yes √ No
The Supervisory Committee has no objection to the supervision matters during the reporting period.
9. Staff in the Company
9.1 Statistics of Employees, Professional Structure of the Staff, and Educational Background
Number of on-the-job employees of the parent company at the end of the reporting period (person) | 9,705 |
Number of on-the-job employees of majorsubsidiaries at the end of the reporting period(person)
Number of on-the-job employees of major subsidiaries at the end of the reporting period (person) | 9,911 |
Total number of on-the-job employees at the end of the reporting period (person) | 19,616 |
The total number of employees receiving salary in the current period (person) | 19,616 |
Number of retired employees (persons) that the parent company and major subsidiaries need to pay | 0 |
Professional Composition | |
Professional Composition Category | Professional composition number (person) |
Production staff | 8,442 |
Sales staff | 6,614 |
Technical staff | 1,975 |
Financial staff | 229 |
Administration staff | 2,229 |
Internal retirees | 127 |
Total | 19,616 |
Education Level | |
Educational level category | Quantity (person) |
Master | 391 |
Bachelor | 4,616 |
College | 4,741 |
Senior High School and below | 9,868 |
Total | 19,616 |
9.2 Salary Policy
The salary of the company's employees is composed of basic salary, performance salary and profit incrementsharing award. All departments of the company implement a post-self-organization mechanism, and revised the"Administrative Measures for Post-Self-organization" to further improve the quantity, quality, efficiency andeconomic value of work. It has established quantifiable and assessable indicators to encourage employees to bespontaneous, improve their work efficiency, and improve the company's management level in order to achieve awin-win situation between the company and its employees.
9.3 Training Program
During the reporting period, centering on the goal of improving the "professional and practical organization" and"learning and research organization", the company adhered to the combination of internal resource integrationand external resource cooperation and carried out three-level training composed of company level,branch/subsidiary level and department level. The company has hired 262 internal lecturers, carried out 1240training sessions, and developed 36 high-quality courses and 15 micro courses.
(1) Strengthening the construction of cadre echelons. In order to train new middle management personnel, the
company has carried out in-depth cooperation with Yangzhou University and set up special training courses.In addition, the company cooperates with external organizations to set up excellent manager training campto train middle managers.
(2) Enriching the course content. For the training of marketing talents, the company organized and invitedoutstanding marketing talents to live broadcast 11 events on the platform of marketing lecture hall to sharesuccessful marketing cases. In addition, the company has developed 9 "Quality Belief Winemaker courses" tohelp marketers master efficient business skills and improve the efficiency of solving marketing problems. Interms of the promotion of skilled talents, the company carries out independent training and appraisal ofvocational skills to support the promotion of skilled talents. The company undertakes the "skill upgradingtraining for senior technicians of provincial winemakers", carries out the "junior college to bachelor degree"degree-upgrading project, and carries out new apprenticeship and special types of work certificate renewaland certification training to promote the skill level of works.
This measure provides human resources guarantee for the company to build the "second stage" of "secondentrepreneurship", and effectively promotes the company's transformation and upgrading and the promotionand implementation of strategic goals. The company carries out talent training with the characteristic concept of"hierarchical, classified and sub-field" and the promotion method of "whole process, all aspects and fullcoverage", and strengthens the construction of talent team.
9.4 Outsourcing of labor service
□ Applicable √ N/A
10. Profit Distribution and Capitalization of Capital Reserves
Profit distribution policy in the reporting period, especially the formulation, implementation and adjustment ofcash dividend policy
√ Applicable □ N/A
On May 30, 2022, the company held the 2021 annual general meeting of shareholders, and reviewed andapproved the company's 2021 equity distribution plan. The specific plan is that based on the total equity on theequity registration date when the profit distribution plan is implemented (excluding the repurchased shares heldin the company’s special securities account for repurchase), use undistributed profits to distribute cash dividendsof CNY30 (tax included) per 10 shares to all shareholders, no bonus shares, no conversion to paid-in capital.
The company implements the 2021 annual equity distribution, with June 21, 2022 as the equity registration date,June 22, 2022 as the ex-rights and ex-dividend date, and the company's total share capital after excluding the542,926 repurchased shares of 1,506,445,07 shares as the base, to all the shareholders. Shareholders will receivea cash dividend of CNY 30 (tax included) for every 10 shares, with a total cash dividend of CNY 4,519,335,222 (taxincluded).
Special explanation of cash dividend policy | |
Whether it complies with the provisions of the | YES |
company's articles of association or the requirementsof the resolution of the shareholders' meeting
company's articles of association or the requirements of the resolution of the shareholders' meeting | |
Whether the dividend standard and ratio are explicit and clear | YES |
Whether the relevant decision-making procedures and mechanisms are complete | YES |
Whether the independent directors performed their duties and played their roles | YES |
Whether minority shareholders have the opportunity to fully express their opinions and demands, and whether their legitimate rights and interests are fully protected | YES |
If the cash dividend policy is adjusted or changed, whether the conditions and procedures are compliant and transparent | The company's cash dividend policy does not adjust or change |
The company was profitable during the reporting period and the parent company's profit available fordistribution to shareholders was positive, but no cash dividend distribution plan was proposed
□ Applicable √ N/A
Profit distribution and conversion of capital reserve into paid-in capital during the reporting period
√ Applicable □ N/A
Number of bonus shares for every 10 shares (shares) | 0 |
Dividends per 10 shares (CNY) (tax included) | 37.4 |
Base of shares (shares) of the distribution plan | 1,506,445,074 |
Amount of cash dividends (CNY) (tax included) | 0.00 |
Amount of cash dividends in other ways (such as share repurchase) (CNY) | 0.00 |
Total cash dividends (including other methods) (CNY) | 5,634,104,576.76 |
Distributable profit (CNY) | 29,676,346,187.62 |
Proportion of total cash dividends (including other methods) to total profit distribution | 100% |
Cash dividend situation | |
If the company's development stage is mature and there is no major capital expenditure arrangement when making profit distribution, the proportion of cash dividends in this profit distribution should be at least 80%. | |
Detailed description of profit distribution or capital reserve conversion plan | |
As audited by Suya Jincheng Certified Public Accountants (Special General Partnership), the parent company realized a net profit of CNY 6,394,344,631.56 in 2022, and the statutory surplus reserve for the year was CNY 0.00, plus the undistributed profit at the beginning of the year of CNY 27,801,336,778.06, so after deducting the 2021 profit distribution of CNY 4,519,335,222.00, the profit available for distribution to shareholders this year was CNY 29,676,346,187.62. In line with the principle of not only taking into account the long-term development of the company, but also giving appropriate returns to shareholders, the company plans to use the total share capital on the equity registration date when the profit distribution plan is implemented (excluding the repurchased shares held in the company's special securities account for repurchase) as the base , using undistributed profits to distribute cash dividends of RMB 37.4 (tax included) for every 10 shares to all shareholders, no bonus shares, and no conversion to share capital. The profit distribution plan complies with the cash dividend policy stipulated in |
the Articles of Association.Assuming that the company's existing total share capital of 1,506,988,000 shares is calculated based on the1,506,445,074 shares after deducting the 542,926 shares currently held in the company's special securitiesaccount for share repurchase, it is estimated that the company will distribute a cash dividend of CNY5,634,104,576.76 (tax included).
the Articles of Association.Assuming that the company's existing total share capital of 1,506,988,000 shares is calculated based on the1,506,445,074 shares after deducting the 542,926 shares currently held in the company's special securitiesaccount for share repurchase, it is estimated that the company will distribute a cash dividend of CNY5,634,104,576.76 (tax included).
11. Implementation of company equity incentive plans, employee stock ownership plans orother employee incentives
√ Applicable □ N/A
11.1 Equity incentive
N/AEquity incentives obtained by the directors and senior management of the company
□ Applicable √ N/A
Evaluation mechanism and incentives for senior managers
The company continues to establish and improve the assessment and traction mechanism based on businessperformance and the compensation and incentive mechanism for management team members oriented by valuecontribution that are compatible with the market economy system and modern enterprise system. The 2021Annual General Meeting of shareholders of the Company reviewed and approved the “Management Measuresfor Compensation and Assessment of Management Team Member”, which stipulates that the annualremuneration of the members of the management team of the Company consists of basic annual salary,performance-based annual salary, tenure incentive and other income, the basic annual salary is paid monthly,the performance-based annual salary is implemented according to the annual performance appraisal results, andthe tenure incentive is linked to the operating performance appraisal during the term of office.
11.2 Implementation of employee stock ownership plans
√ Applicable □ N/A
All valid employee stock ownership plans during the reporting period
Range of employees | Number of employees | Total shares held | Changes | Proportion to the total share capital of listed companies | Funding sources for the implementation plan |
Company’s directors (excluding independent directors), | 4,738 | 9,118,384 | N/A | 0.61% | Participants’ legal remuneration, self-financing and other |
supervisors,seniormanagementpersonnel, andmiddle-leveland abovepersonnel andcore backboneswho aredetermined bythe board ofdirectors of thecompany andwholly-ownedsubsidiaries toplay animportant rolein thecompany'soverallperformanceand mediumand long-termdevelopment
supervisors, senior management personnel, and middle-level and above personnel and core backbones who are determined by the board of directors of the company and wholly-owned subsidiaries to play an important role in the company's overall performance and medium and long-term development | methods permitted by laws and regulations |
Shareholdings of Directors, Supervisors and Senior Management in the Employee Stock Ownership Plan duringthe Reporting Period
Name | Title | Number of shares held at the beginning of the reporting period | Number of shares held at the end of the reporting period | Proportion to the total share capital of listed companies |
Zhang Liandong | Chairman | 96,404 | 96,404 | 0.01% |
Zhong Yu | Deputy chairman, President | 96,404 | 96,404 | 0.01% |
Liu Huashuang | Director, CEO (Leaving office) | 96,404 | 96,404 | 0.01% |
Zhou Xinhu | Director, Vice president (Leaving office) | 48,202 | 48,202 | 0.00% |
Chen Taiqing | Chairman of the Board of Supervisors | 48,202 | 48,202 | 0.00% |
Chen Fuya | Supervisor | 48,202 | 48,202 | 0.00% |
Chen Taisong | Supervisor | 48,202 | 48,202 | 0.00% |
Lin Qing | Vice president | 48,202 | 48,202 | 0.00% |
Zheng Bujun | Vice president | 48,202 | 48,202 | 0.00% |
Yin Qiuming | Vice president, CFO | 48,202 | 48,202 | 0.00% |
Li Yuling | Vice president | 48,202 | 48,202 | 0.00% |
Lu Hongzhen | Secretary of the | 19,281 | 19,281 | 0.00% |
Board
Board | ||||
Fu Hongbing | Vice president (Leaving office) | 48,202 | 48,202 | 0.00% |
Changes in asset management institutions during the reporting period
□ Applicable √ N/A
Changes in equity due to disposal of shares by holders during the reporting period
□ Applicable √ N/A
The exercise of shareholders' rights during the reporting periodN/AOther relevant situations and explanations of the employee stock ownership plan during the reporting period
□ Applicable √ N/A
Members of Employee Stock Ownership Plan Management Committee Change
□ Applicable √ N/A
The financial impact of the employee stock ownership plan on the listed company during the reporting periodand related accounting treatment
√ Applicable □ N/A
In this period, the company confirmed that the cost increase of "capital reserves-other capital reserves" wasCNY 122,414,308.77.Termination of employee stock ownership plans during the reporting period
□ Applicable √ N/A
Other instructions: none
11.3 Other employee incentives
□ Applicable √ N/A
12. Construction and implementation of internal control system during the reporting period
12.1 Construction and implementation of internal control
12.1.1 Internal control system construction
1. Establish a standard internal control system.
The company has mainly formulated 15 categories and 260 systems for human resources, quality and foodsafety, financial and audit management.
2. Optimize the internal control environment of the enterprise.
(1) Standardize the establishment of the organizational structure. According to the relevant laws andregulations of China, clarify the responsibilities, authority, conditions, rules of procedure and work procedures ofthe board of directors, board of supervisors and managers to ensure that decision-making, execution andsupervision are separated from each other and form checks and balances. Clarify the internal division of labor ofthe board of directors, and set up special committees including strategy committee, nomination committee,
remuneration and appraisal committee, and audit committee.
(2) Improve human resources policies.
① Improve the staff training mechanism. The company needs a strict assessment when hiring employees,select outstanding talents to join the company, and form a system for employees on training, treatment,performance assessment and promotion. For employees in different positions, the company provides channelsto improve their comprehensive quality to cultivate high-quality talents. ② Establish an effective incentivemechanism. On the basis of following the fairness and relative stability of incentives and constraints, thecompany formulates equity incentives and mechanisms for spontaneous compensation incentives which isconducive to stimulating employees' subjective initiative, giving full play to their potential, safeguardingcorporate interests and achieving corporate goals.
3. Establish a risk assessment firewall. The company has formulated “Risk and Opportunity ManagementMeasures”, “Risk Management Responsibility Investigation System” and other systems to investigate risks fromthe aspects of food safety and behavior safety, and make preparations for the occurrence and generation of risks.At the same time, the company organizes the Guidance on Common Risks and Control of Contract Management,Risk Management Training and other trainings, focusing on the risk management system, internal control systemand integrated risk management and control module, to discover and deal with risk points in time.
4. Implement effective internal control activities. With reference to the risk assessment level, the companyimplements measures such as division of responsibilities control, authorization control, review and approvalcontrol, budget control and performance evaluation control, to effectively safeguard the interests of theenterprise and ensure the stable and orderly progress of various work.
5. Improve the information and communication mechanism. The company establishes the technical platformof the information system, establishes a sensitive information collection and feedback system, realizes theupward, parallel or downward flow and communication of various information within the enterprise, andimplements the whole process of the entire internal control information from production, release to feedbackmodern management.
6. Strengthen internal audit and internal supervision of enterprise management. The company establishes ascientific view of internal audit culture, pays great attention to the organization and team building of the auditdepartment, sets up the internal audit department in accordance with the relevant regulations of China, andallocates internal auditors with professional competence, maintains the independence of internal audit, andmakes the internal audit department more independent. Besides, the internal audit has transformed from asingle supervision function to a comprehensive function of supervision, evaluation, control and consultation, andfully exerted the value-added function. By sorting out the supervision content and matters, the company clarifiesthe evaluation standards and audit methods of each department, and constantly improves the audit work plan.In addition, the company needs to strengthen the construction of audit informatization, constantly strengthenthe thinking mode of big data audit, enhance the ability of big data audit, comprehensively use on-site audit andoff-site audit methods, and improve the efficiency of internal audit.
12.1.2 Internal control system implementation
The company continues to establish and improve the internal control system and can effectively implementit. In the focus of audit, highlight the key supervision of key funds, important projects, important assets andimportant positions responsible for the economic responsibility of personnel. In the content of audit, benefitaudit, responsibility audit and internal control system audit should be the main. In terms of audit methods, auditand research should be combined, post-supervision should be transformed into pre-control, and comprehensiveaudit should be strengthened. Audit means need to gradually transition to modern audit means. The auditCommittee of the Board of Directors of the Company annually reviews and supervises the financial report, theeffectiveness of internal control, and the reasonableness and effectiveness of corporate governance; Carry out
internal control self-evaluation every year; Optimize the system and management process every year accordingto the internal and external environment and development requirements of the enterprise; Closely focus on thekey work of the company, carry out full coverage audit of all molecular companies and functional departments,so as to achieve full coverage audit of key departments once a year; Conduct spot check and audit of importantdepartments, with a spot check rate of 50%, and audit with full coverage once every two years; Spot check andaudit of general departments, the spot check rate of 33%, to achieve full coverage of audit once every threeyears.
12.2 Details of major deficiencies in internal control discovered during the reporting period
□ Yes √ No
13. The company's management and control of subsidiaries during the reporting period
Name of the subsidiaries | Combination plan | Combination progress | Issues | Solutions | Resolve progress | Follow-up resolution plan |
N/A | N/A | N/A | N/A | N/A | N/A | N/A |
14. Internal control self-assessment report or internal control audit report
14.1 Self-evaluation Report on Internal Control
Date of disclosure of the full text of the internal control evaluation report | April 26, 2023 | |
Disclosure Index of the Full Text of the Internal Control Evaluation Report | The full text of the "Self-assessment Report on Internal Control" will be disclosed on http://www.cninfo.com.cn on April 26, 2023 | |
The ratio of the total assets of the company included in the evaluation scope to the total assets of the company's consolidated financial statements | 99.48% | |
The ratio of the operating income of the company included in the evaluation scope to the operating income of the company's consolidated financial statements | 99.99% | |
Defect identification standard | ||
Type | Financial report | Non-financial report |
Qualitative Criteria
Qualitative Criteria | (1) Signs of major deficiencies in financial reports include: i. Fraudulent conduct by the company’s directors, supervisors or senior executives; ii. Significant misstatements in the current financial statements were found, but the management failed to detect them during the operation of internal control; iii. As a result of internal control evaluation, major deficiencies have not been rectified; iv. The audit committee and internal audit institution's supervision of internal control is invalid. (2) Signs of significant deficiencies in financial reporting include: i. Failure to select and apply accounting policies in accordance with generally accepted accounting principles; ii. Failure to establish anti-fraud procedures and control measures; iii. Failure to establish corresponding accounting treatment for non-routine or special transactions iv. There are one or more deficiencies in the control over the period-end financial reporting process and there is no reasonable assurance that the prepared financial statements will achieve the true and accurate objectives. (3) General defects refer to other control defects other than the above-mentioned major defects and important defects. | (1) Signs of major deficiencies in non-financial reports include: i. lack of democratic decision-making procedures, unscientific decision-making procedures, major mistakes which resulting in major property losses to the company; ii. Serious violation of national laws and regulations; iii.Lack of important business management system or systemic failure of system operation; iv. The company's major or important internal control deficiencies cannot be rectified in a timely manner; v. The company continues or has a large number of important internal control deficiencies . (2) Signs of significant deficiencies in non- financial reporting include: i. The business behavior violates relevant national laws; ii. Inadequate decision-making process leads to important errors and large losses; iii. Serious loss of business personnel in key positions; iv. Deficiencies in important business systems or systems. (3) General deficiencies refer to control deficiencies other than the above major deficiencies and significant deficiencies. |
Quantitative standard | Major defects: Misstatement > 3% of total operating income; Misstatement > 5% of total profit; Misstatement > 2% of total assets. Important defects: 1% of total operating income < misstatement ≤ 3% of total operating income; 3% of total profit < misstatement ≤ 5% of total profit; 1% of total assets < misstatement ≤ 2% of total assets. General defects: misstatement ≤ 1% of total operating income; misstatement ≤ 3% of total profit; misstatement ≤ 1% of total assets. | Major defect: loss accounts for ≥1% of total assets. Important defects: 0.5%≤losses account for less than 1% of total assets. General defects: The proportion of loss to total assets is less than 0.5%. |
Number of major deficiencies in financial reports (pieces) | 0 | |
Number of major deficiencies in | 0 |
non-financial reports (pieces)
non-financial reports (pieces) | |
Number of material deficiencies in financial reports (pieces) | 0 |
Number of material deficiencies in non-financial reports (pieces) | 0 |
14.2 Internal Control Audit Report
√ Applicable □ N/A
Deliberation Opinion Paragraph in Internal Control Audit Report | |
We believe that on December 31, 2022, Yanghe Co., Ltd. maintained effective internal control over financial reporting in all material aspects in accordance with the “Basic Norms for Corporate Internal Control” and relevant regulations. | |
Disclosure Situation of Internal Control Audit Report | Disclosed |
Disclosure date of the full text of the internal control audit report | April 26, 2023 |
Full text disclosure index of internal control audit report | The full text will be disclosed on http://www.cninfo.com.cn on April 26, 2023 |
Types of opinions on internal control audit reports | Standard unqualified opinion |
Whether there are material deficiencies in non-financial reporting | No |
Whether the accounting firm issued an internal control audit report with a non-standard opinion
□ Yes √ No
Whether the internal control audit report issued by the accounting firm is consistent with the self-evaluationreport of the board of directors
√ Yes □ No
15. Special Rectification Actions for Self-inspected Problems of Listed Companies
During the self-inspection, some directors, supervisors and senior executives of the company were unable toattend the general meeting of shareholders in person due to business trips and other reasons. The company hadpromptly notified the relevant personnel of the convening of the meeting and the deliberation of proposals afterthe meeting.
Section V Environmental and Social Responsibility
1. Significant environmental issues
Whether the listed company and its subsidiaries belong to the key pollutant discharge companies announced bythe environmental protection department
√Yes □ No
Environmental protection related policies and industry standardsThe company strictly complies with environmental protection related laws and regulations and industrystandards.
Relevant laws and regulations: “Environmental Protection Law of the People's Republic of China”, “Law of thePeople's Republic of China on Water Pollution Prevention and Control”, “Law of the People's Republic of China onthe Prevention and Control of Environmental Pollution by Solid Waste”, “Law of the People's Republic of China onPrevention and Control of Air Pollution”, “Law of the People's Republic of China on the Prevention of NoisePollution”, “Rules for Implementation of the Law on the Prevention and Control of Water Pollution”, “Measuresfor administrative penalties on environmental protection”, “Rules for the Implementation of the Air PollutionPrevention and Control Law”, “Regulations on the Safety Management of chemical dangerous Goods”,“Regulations on discharge permit Administration”, “Regulations of Jiangsu Province on Environmental Protection”and so on.
Relevant industry standards: “Emission of Odorous Pollutants” (GB14554-93) Table 1 Secondary Standards, “TheIntegrated Emission Standard of Air Pollutants” (GB16297-1996) Table 2 Standard limits, “Industrial enterpriseboundary environmental noise emission standard” (GB12348-2008) Table 1 Class 2 standards, “Dischargestandard for water pollutants of fermented alcohol and liquor industry” (GB27631-2011), “Discharge standardof air pollutants from boilers” (DB32/ 4385—2022), “Classified Management List of Environmental ImpactAssessment of Construction Projects (2021 Edition)” and so on.
Environmental protection administrative permit
The company and its subsidiaries have complete materials such as environmental impact reports and pollutantdischarge permits for construction projects.
Jiangsu Yanghe Distillery Co., Ltd.:On July 18, 2022, the Company applied to Suqian Bureau of EcologicalEnvironment for the “Pollutant Discharge Permit of Yanghe Branch of Yanghe Stock Co., LTD.”, valid from July 18,2022 to July 17, 2027.Jiangsu Shuanggou Wine Co., Ltd.:The Company has obtained “Jiangsu Provincial Pollutant DischargeLicense” issued by Suqian Municipal Bureau of Ecological Environment on August 12, 2021, valid from August 12,2021 to August 11, 2026.
Jiangsu Yanghe Distillery Co., Ltd. Siyang Branch:On November 11, 2022, the Company obtained the“Pollutant Discharge License of Siyang Branch of Yanghe Corporation” issued by Suqian Municipal Bureau ofEcological Environment. The license is valid from November 11, 2022 to November 10, 2027.
Guizhou Guijiu Group Co., Ltd.:The company applied for the renewal of the pollutant discharge permit in2022, which has been approved by Guiyang Bureau of Ecological Environment and is valid from October 18, 2022to October 17, 2027.
Industrial discharge standards and details of the discharge of pollutants involved in production and businessactivities
Company name or subsidiary name | Types of major pollutants and characteristic pollutants | Names of major pollutants and characteristic pollutants | Emission method | Number of vents | Distribution of discharge outlets | Emission concentration | Implemented pollutant discharge standards | Total emissions | Total approved emissions | Excessive emissions |
Jiangsu Yanghe Distillery Co., Ltd. | Waste water | Oxygen Demand, Ammonia Nitrogen, Total Phosphorus, Total Nitrogen | Indirect emissions | 1 | Longitude: 118°22′33.74″ Latitude: 33°47′26.74 ″ | 57.95mg/L 0.78mg/L 0.81mg/L 23.94mg/L | 650mg/L 40mg/L 5mg/L 60mg/L | 76.95 tons 1.03 tons 1.07 tons 31.79 tons | 454.7 tons/year 74.7 tons/year 2.07 tons/year 37.3 tons/year | None |
Jiangsu Shuanggou Wine Co., Ltd. | Waste water | Oxygen Demand, Ammonia Nitrogen, Total Phosphorus, Total Nitrogen | Indirect emissions | 1 | Longitude: 118°12′07″ Latitude: 33°13′45″ | 59.55mg/L 2.43mg/L 1.64mg/L 12.96mg/L | 500mg/L 40mg/L 8mg/L 60mg/L | 39.12 tons 1.47 tons 1.01 tons 8.60 tons | 400 tons/year 32 tons/year 6.4 tons/year 48 tons/year | None |
Jiangsu Yanghe Distillery Co., Ltd. Siyang | Waste water | Oxygen Demand, Ammonia Nitroge | Indirect emissions | 1 | Longitude: 118°45′33.08″ Latitude: | 119mg/L 3.98mg/L 1.7mg/L | 500mg/L 60mg/L 6mg/L 60mg/L | 94 tons 0.65 tons 1.76 tons | 600 tons/year 42 tons/year 5 tons/year | None |
Branch
Branch | n, Total Phosphorus, Total Nitrogen | 33°42′25.70″ | 23mg/L | 11.44 tons | 58.8 tons/year | |||||
Guizhou Guijiu Group Co., Ltd. | Waste water | Oxygen Demand, Ammonia Nitrogen, Total Phosphorus, Total Nitrogen | Straight emissions after processing | 1 | Longitude: 106°35′43″ Latitude: 25°50′52″ | 42.73mg/L 1.18mg/L 0.098mg/L 8.66mg/L | 100mg/L 10mg/L 1mg/L 20mg/L | 4.65 tons 0.13 tons 0.01 tons 0.94 tons | 8.958 tons/year 0.898 tons/year 0.0925 tons/year 1.85 tons/year | None |
Guizhou Guijiu Group Co., Ltd. | exhaust gas | Nitrogen oxide | Straight emissions | 1 | Longitude: 106°35′43″ Latitude: 25°50′52″ | 33.86mg/m? | 200mg/m3 | 2.47 tons | 6.199 tons/year | None |
Treatments of pollutants
Jiangsu Yanghe Distillery Co., Ltd.:The sewage treatment station in use was completed in 2012, with a totalinvestment of CNY 96 million, covering an area of 19,000 square meters, with a designed sewage treatmentcapacity of 10,000 tons per day. The sewage treatment process adopts physical treatment method + chemicaltreatment method + anaerobic biological treatment method + aerobic biological treatment method in order toreach the treatment of high-concentration wastewater of 250 tons per hour. The emission implements the"Fermentation Alcohol and Liquor Industry Pollutant Emission Standard (GB27631-2011)" to modify the list ofindirect emission protocol standards. In 2022, 1.328 million tons of wastewater were treated. COD reduction was19,471.2 tons, ammonia nitrogen reduction was 223.6 tons, total phosphorus reduction was 138.81 tons, totalnitrogen reduction was 305.12 tons. The emission concentration of all pollutants is lower than the nationalemission standard. There is a biogas boiler room equipped with 9 biogas boilers, and the biogas produced byanaerobic fermentation of sewage treatment was all used for biogas boiler combustion. The steam produced bythe biogas boiler was used for brewing production, and the steam output was 135,000 tons in 2022. The sludgeand vinasse are mainly recycled by qualified third party units.
Jiangsu Shuanggou Wine Co., Ltd.:The sewage treatment station in use was completed in 2013, with a total
investment of CNY 42.5 million, covering an area of 15,000 square meters, with a designed sewage treatmentcapacity of 5,400 tons per day. Sewage treatment adopts anaerobic tower + UASB + AAO + secondarysedimentation tank + phosphorus removal tank treatment process, in accordance with the revised list of"Fermentation Alcohol and Liquor Industrial Pollutant Discharge Standard ( GB27631-2011)". In 2022, 597,600tons of wastewater were treated. COD reduction was 6,538.24 tons, ammonia nitrogen reduction was 92.97 tons,total phosphorus reduction was 42.65 tons, total nitrogen reduction was 162.58 tons. The emissionconcentration of all pollutants is lower than the national emission standard. There is a biogas boiler roomequipped with 3 biogas boilers, and the biogas produced by anaerobic fermentation of sewage treatment was allused for biogas boiler combustion. The steam produced by the biogas boiler was used for brewing production,and the steam output was 31,700 tons in 2022. The sludge and vinasse are mainly recycled by qualified thirdparty units.
Jiangsu Yanghe Distillery Co., Ltd. Siyang Branch:The sewage treatment station in use was completed in 2015,with a total investment of CNY 50 million, covering an area of about 15,000 square meters, with a designedsewage treatment capacity of 6,000 tons per day. The sewage treatment process adopts EGSB + AAO + advancedtreatment technology, and implements the indirect discharge agreement standard of the revised list of"Fermentation Alcohol and Liquor Industry Pollutant Discharge Standard GB27631-2011". In 2022, 867,900 tonsof wastewater were treated. COD reduction was 9496.62 tons, ammonia nitrogen reduction was 93.5 tons, totalphosphorus reduction was 252.74 tons, total nitrogen reduction was 87.08 tons. The emission concentration ofall pollutants is lower than the national emission standard. There is a biogas boiler room equipped with 6 biogasboilers, and the biogas produced by anaerobic fermentation of sewage treatment was all used for biogas boilercombustion. The steam produced by the biogas boiler was used for brewing production, and the steam outputwas 82,000 tons in 2022. The sludge and vinasse are mainly recycled by qualified third party units.
Guizhou Guijiu Group Co., Ltd.:The sewage treatment station in use was completed in 2021, with a totalinvestment of CNY 11.5 million, covering an area of about 1,980 square meters, with a designed sewagetreatment capacity of 700 tons per day. The wastewater produced by pretreatment + AAO + MBR + ozonedecolorization and disinfection + chemical phosphorus removal treatment process shall comply with the directdischarge standard in Table 2 of the Discharge Standard for Water Pollutants in Fermented Alcohol and LiquorIndustry (GB27631-2011). In 2022, 108,600 tons of wastewater were treated. COD reduction was 746.89 tons,ammonia nitrogen reduction was 19.55 tons, total phosphorus reduction was 34.67 tons, total nitrogenreduction was 10.84 tons. The emission concentration of all pollutants is lower than the national emissionstandard. The combustion equipment is gas-fired boilers with natural gas as fuel. The sludge and vinasse aremainly recycled by qualified third party units.
Emergency plan for environmental emergencies
The company and its subsidiaries have formulated contingency plans for environmental emergencies. Thecompany has filed with the Bureau of Ecological Environment of Suqian City;Shuanggou Wine has filed with theSihong Ecological Environment Bureau of Suqian City, the company's Siyang Branch has filed with Siyang CountyEcological Environment Bureau for the record, Guijiu Company has filed with Xiuwen County environmentalsupervision brigade.
The company and its branches and subsidiaries actively organize employees to train and learn the plan, and
regularly carry out environmental emergency plan drills, to improve the environmental protection awareness andemergency handling ability of all staff.
Environmental Self-Monitoring Program
The company and its subsidiaries have completed self-monitoring plans
Jiangsu Yanghe Distillery Co., Ltd. has installed COD, ammonia nitrogen, total nitrogen, total phosphorus, PH,flow online monitoring instruments, whose data is connected to the automatic monitoring and basic databasesystem of key polluters and the Jiangsu Province pollution source "One enterprise, One station" managementsystem. The daily manual sampling and self-testing is conducted, and a periodical sampling inspection byqualified institutions is entrusted by a third party. The environmental self-monitoring program has been filedwith the Jiangsu Province self-monitoring information release platform of key monitoring enterprises.
Jiangsu Shuanggou Wine Co., Ltd. has installed COD, ammonia nitrogen, total nitrogen, total phosphorus, PH,flow online monitoring instruments and released the test results on the automatic monitoring and basicdatabase system of key pollutant discharge enterprises, the Jiangsu Province self-monitoring information releaseplatform of pollutant discharge enterprises, and the Suqian City Big Data Center of Ecological Environment. Thedaily manual sampling and self-testing is conducted, and a sampling inspection by qualified institutions isentrusted by a third party every month. The environmental self-monitoring program has been filed with theJiangsu pollutant discharging enterprises self-monitoring information release platform.
Jiangsu Yanghe Distillery Co., Ltd. Siyang Branch has installed COD, ammonia nitrogen, total nitrogen, totalphosphorus, PH, flow online monitoring instruments and released the test results on the automatic monitoringand basic database system of key pollutant discharge enterprises, the Jiangsu Province self-monitoringinformation release platform of pollutant discharge enterprises, and the Suqian City Big Data Center of EcologicalEnvironment. The daily manual sampling and self-testing is conducted, and a sampling inspection by qualifiedinstitutions is entrusted by a third party every month. The environmental self-monitoring program has been filedwith the Jiangsu Province self-monitoring information release platform of key monitoring enterprises.
Guizhou Guijiu Group Co., Ltd. has installed COD, ammonia nitrogen, total nitrogen, total phosphorus, PH, ss,flow online monitoring instruments released the test results on Guizhou Province Automatic monitoring andmanagement platform for key pollution sources. The daily manual sampling and self-testing is conducted, and asampling inspection by qualified institutions is entrusted by a third party every quarter. The environmentalself-monitoring program has been filed with the Xiuwen Branch of Guiyang Bureau of Ecology and Environment.
Input in environmental governance and protection and payment of environmental protection tax
The company, its branches and subsidiaries actively carry out environmental treatment and protection work. In2022, the total investment of sewage operation and environmental management is about CNY 46.39 million, andthe environmental protection tax is about CNY 1.0808 million.
Measures taken to reduce carbon emissions during the reporting period and their effects
√ Applicable □ N/A
In 2022, the company actively responded to the Party and the state to implement the spirit requirements of thenational carbon peak carbon neutrality strategy, and cooperated with China Energy Conservation Group to carryout enterprise carbon emission inventory and product carbon footprint accounting. The company started tocompile the Carbon Peak Carbon Neutrality Plan and Action Plan of Yanghe Stock to clarify the strategic goal andaction path of the company to achieve carbon peak carbon neutrality.
In 2022, the company is committed to spreading low-carbon concepts and improving energy utilization efficiency.
(1) Energy saving: All the biogas produced by anaerobic fermentation through sewage treatment was used forboiler combustion to produce steam, with an annual steam output of 240,000 tons and a reduction of 75,000tons of carbon dioxide emissions. By controlling the total air intake pressure and gas consumption loss, theSiyang Branch of the company reduced the purchased steam by 57,500 tons and carbon emissions by 17,800tons. Shuanggou implemented automatic slurry filling transformation of slurry tank, saving 2,586 tons of waterand 4,938 tons of steam annually. Siyang Branch of the company has promoted the watt reduction project ofsolar projection lamp, solar street lamp and factory lamp. Up to now, it has completed the replacement of 125solar projection lamp, 114 solar street lamp and 396-watt reduction lamp, reducing the state grid electricityconsumption by 976,400 KWH in total. Guizhou Guijiu Company adjusted boiler steam pressure according tobrewing demand to realize fine management of natural gas, and the consumption decreased by 3.5% comparedwith the same period last year.
(2) Resource conservation: Shuanggou Wine Industry carried out the transformation of circulating water inproduction, and realized the annual saving of 129,900 tons of water resources through the reuse of wastewaterand the optimization of circulating water equipment. In addition, the transformation of sludge pressure filterequipment measures to achieve the annual pharmaceutical, electricity savings of CNY 245,000.
(3) Green energy use: The accumulative new photovoltaic during the reporting period is 14.4WM, including
8.4WM from Yanghe Branch and 6WM from Shuanggou Wine.
(4) Ecological protection: Shuanggou Wine implemented measures to improve the soil, optimized the greenspace of about 500 square meters in the reporting period, and added more than 1200 green plants.
(5) Low-carbon concept: the company launched the initiative call of "Be a low-carbon master" and "low-carbonlife", and carried out activities such as Yanghe Top ten "Low-carbon Master" selection and energy conservationPublicity week. A total of 16,800 people participated in these activities, which strengthened and spread theconcept of low-carbon, shaped the new wind of saving, and painted a green picture.
Administrative penalties for environmental issues during the reporting period
Company or subsidiary name | Reason for punishment | Violation situation | Punishment result | The impact on the production and operation of listed companies | Rectification measures |
None | None | None | None | None | None |
Other environmental information that should be disclosed
NoneOther environmental protection related informationNone
2.Social responsibility
The company has disclosed the “2022 Annual Social Responsibility Report and ESG Report” ,seewww.cninfo.com.cn for details.
3. The Achievements of Poverty Alleviation and Rural Revitalization
During the reporting period, the company adhered to the social responsibility concept of "feeding back thecountry and the people", actively fulfilled its corporate social responsibility, and devoted itself to social welfareand charity undertakings. On the road of promoting "common prosperity", the company has further built a greenraw grain planting base, driven the steady development of supporting enterprises in the upstream anddownstream industrial chains of planting industry, processing industry, packaging industry and so on to increaseemployment opportunities, and become a pillar force in poverty alleviation. In promoting "rural revitalization",the company has actively carried out assistance to poor villages, helping Taiping Village and Qiuzhuang Village inZhenglou Town to achieve poverty alleviation. In addition, the company and Zhang Du village cooperation tocarry out "love warm sunset, dream for love" for the golden wedding elderly collective wedding photos,"weekend hairdressers" activities. The company also cooperated with Qiuzhuang Village to carry out theMid-Autumn Festival visit to the countryside.
Furthermore, The "Lasa Langrejiu Village" industrial aid project for Tibet has been successfully implemented,driving rural revitalization through the construction of highland barley finishing industry, wine making industryand characteristic cultural and tourism industry. In terms of "public welfare responsibility", the company donatedCNY2 million to Suqian Charity Federation to help nearly 10,000 poor students realize their dreams of university,and donated CNY800,000 from online sales of co-branded products to China Veterans Employment andEntrepreneurship Service Promotion Association, which was used to help veterans find jobs and start businesses,and held online fundraising rallies for education and promoted the project of "Donate love for children's health".Measures such as supporting the development of China's space industry and providing assistance toearthquake-stricken areas have also been effectively implemented. Yanghe Group uses public welfare actions todemonstrate its social responsibility and responsibility and pass on love.
In 2023, the company will continue to respond to the call of the state, thoroughly implement the policy ofconsolidating and expanding the achievements of poverty alleviation and effectively linking them with ruralrevitalization, and take stronger actions to boost common prosperity and rural revitalization.For other information, please refer to the “2022 Annual Social Responsibility Report and ESG Report” disclosedby the company.
Section VI Significant Events
1. Performance of commitments
1.1 Complete and incomplete commitments of the Company and its actual controller, shareholders, relatedparties, acquirers, and other related parties for the commitments by the end of the reporting period
√ Applicable □ N/A
Commitments | Giver of commitments | Commitment Type | Details of Commitment | Date of Commitment | Term of Commitment | Performance |
Commitments made at IPO or refinancing | Jiangsu Yanghe Group Co. Ltd. | Commitments on horizontal competition, related transactions, and capital occupation | 1. Commitment to avoid horizontal competition: (1) The company is not currently engaged in any business that competes with the joint-stock company. The company promises to maintain the existing business structure, and not to directly or indirectly operate with the business of the joint-stock company that actually constitutes competition or may constitute competition. Any business, or newly established subsidiaries or affiliated | August 26, 2009 | Long-term | In normal execution |
enterprisesengaged intheabove-mentionedbusiness. (2)If thecompanyviolates theabovecommitments, thejoint-stockcompany hasthe right torequest thecompany toimmediatelyterminatethe businessof horizontalcompetitionandcompensatethe economicloss causedto thejoint-stockcompany. Atthe sametime, thecompanyshall payliquidateddamages ofCNY 10million to thejoint-stockcompany. (3)The companypromises notto use itsstatus as thecontrollingshareholderin thejoint-stockcompany todamage thelegitimaterights andinterests ofthejoint-stockcompany,othershareholdersof the
joint-stockcompany andcreditors ofthejoint-stockcompany. ⑷This letter ofcommitmenttakes effectfrom thedate ofsigning andcannot berevokedwithout theconsent ofthejoint-stockcompany. 2.Commitmentto reducerelated-partytransactions:
The companywill strictlyabide by therequirementsof relevantlaws,regulationsandnormativedocumentssuch as theCompanyLaw, theSecuritiesLaw, and theCode ofCorporateGovernancefor ListedCompanies,and furtherreduce andstrictlyregulate therelationshipwithjoint-stockcompanies.All kinds ofrelated-partytransactionsbetween thetwocompanies,to ensure
that thestatus of thecontrollingshareholderand actualcontrollerwill not beused to harmthe interestsof thejoint-stockcompany andothershareholdersof thejoint-stockcompany,and that nonewoccupationof thejoint-stockcompany willoccur.
that the status of the controlling shareholder and actual controller will not be used to harm the interests of the joint-stock company and other shareholders of the joint-stock company, and that no new occupation of the joint-stock company will occur. | ||||||
Jiangsu Blue Alliance Co., Ltd. | Commitments on horizontal competition, related transactions, and capital occupation | Commitment to avoid horizontal competition: 1. The company is mainly engaged in investment management, and does not operate the same or related business as the issuer. The company will not engage in the same or related business as the issuer's business, and will not harm the issuer's | November 23, 2017 | Long-term | In normal execution |
interests, norwill it seekillegitimatebenefits fromthe issuer; 2.If thecompanyviolates theabovecommitments, the issuerhas the rightto demandcompensation from itowing toeconomiclosses causedto the issuer,and payliquidateddamages ofCNY 5million, andhave theright torequest theacquisition ofthe businessproject at themarket priceof thebusinessproject ortheestablishment cost price(whichever islower); 3.ThiscommitmentThe book willtake effectfrom the
date ofsigning andcannot berevokedwithout theconsent ofthe issuer.
date of signing and cannot be revoked without the consent of the issuer. | ||||||
Jiangsu Blue Alliance Co., Ltd. | Share Reduction Commitment | After the issuer's shares have been listed and traded on the stock exchange for one year, the shares transferred each year shall not exceed 25% of the total number of the issuer's shares held by the issuer, and the issuer's shares held and their changes shall be reported to the issuer in a timely manner. | November 23, 2017 | Long-term | In normal execution | |
Cong Xuenian | Other commitments | As one of the directors, supervisors and senior managers of the of Jiangsu Blue Alliance Co., Ltd., I promise: 1. | November 23, 2017 | March 30, 2024 | In normal execution |
During theterm ofoffice of theissuer, theannualtransfer ofBlue Allianceequity shallnot exceed25% of thetotal equityof BlueAlliance heldby me 2. If Iresign fromthe issuer, Ishall nottransfer theshares of theBlue Allianceheld by mewithin sixmonths afterresignation;
3. If I resign
from theissuer, thenumber ofsharestransferredshall notexceed 50%of the totalshares of theBlue Allianceheld by mewithin 12months of sixmonths ofresignation
During the term of office of the issuer, the annual transfer of Blue Alliance equity shall not exceed 25% of the total equity of Blue Alliance held by me 2. If I resign from the issuer, I shall not transfer the shares of the Blue Alliance held by me within six months after resignation; 3. If I resign from the issuer, the number of shares transferred shall not exceed 50% of the total shares of the Blue Alliance held by me within 12 months of six months of resignation | ||||||
Feng Pantai | Other commitments | As one of the directors, supervisors and senior | November 23, 2017 | January 8, 2022 | Execution completed |
managers ofthe ofJiangsu BlueAlliance Co.,Ltd., Ipromise: 1.During theterm ofoffice of theissuer, theannualtransfer ofBlue Allianceequity shallnot exceed25% of thetotal equityof BlueAlliance heldby me 2. If Iresign fromthe issuer, Ishall nottransfer theshares of theBlue Allianceheld by mewithin sixmonths afterresignation;
3. If I resign
from theissuer, thenumber ofsharestransferredshall notexceed 50%of the totalshares of theBlue Allianceheld by mewithin 12months of six
months ofresignation
months of resignation | |||
Whether the promise is fulfilled on time | YES | ||
If the commitment is overdue and not fulfilled, the specific reasons for the failure to fulfill and the next work plan shall be explained in detail | N/A |
1.2 Where any profit forecast was made for any of the Company’s assets or projects and the currentreporting period is still within the forecast period, the Company shall explain whether the performance ofthe asset or project reaches the profit forecast and why:
□ Applicable √ N/A
2. Non-operating capital occupation of listed companies by controlling shareholders and otherrelated parties
□ Applicable √ N/A
No such case during the current reporting period.
3. Illegal Provision of Guarantees for External Parties
□ Applicable √ N/A
No such case during the current reporting period.
4. Explanation of the board of directors on the latest ‘non-standard audit report’
□ Applicable √ N/A
5. Explanation Given by the Board of Directors, Supervisory Committee and IndependentDirectors (if applicable) regarding the “Non-standard Auditor’s Report” Issued by the CPAFirm for the Current Reporting Period
□ Applicable √ N/A
6. For Changes in Accounting Policies, Accounting Estimates or Correction of SignificantAccounting Errors Compared with the Financial Report for the Prior Year
□ Applicable √ N/A
There was no change in accounting policies, accounting estimates or correction of significant accounting errorsduring the reporting period of the Company.
7. Explanation of changes in the scope of consolidated statements compared with the financialreport of the previous year
√ Applicable □ N/A
1. Set up subsidiaries
(1) In March 2022, the company, Xizang Earth Third Pole Industry Development Co., Ltd., Lhasa Pure LandIndustry Investment and Development Group Co., Ltd., and Shenzhen Baoneng Food Technology Group Co., Ltd.,jointly invested CNY 400.00 million to establish Xizang Earth Third Pole Wine Co., Ltd., of which the companyinvested CNY 204.00 million. 51% of its registered capital; Xizang Earth Third Pole Industry Development Co., Ltd.invested CNY 72.00 million, accounting for 18% of its registered capital; Lhasa Jingland Industry Investment andDevelopment Group Co., Ltd. invested CNY 64.00 million, accounting for 16% of its registered capital; ShenzhenBaoneng Food Technology Group Co., Ltd. Invested CNY 60.00 million, accounting for 15% of its registered capital.It will be included in the consolidated scope of the consolidated financial statements from March 2022.
(2) In August 2022, Guizhou Maotai Town Guijiu Wine Industry Co., Ltd., the holding subsidiary, investedCNY 0.50 million to establish Guizhou Guijiu Wine Industry Operation Co., Ltd., accounting for 100% of itsregistered capital. Since August 2022, the company has included Guizhou Guijiu Wine Operation Co., Ltd. in theconsolidated scope of the consolidated financial statements.
(3) In August 2022, the Company subscribed CNY 10 million to establish Jiangsu Blue Shangyin CateringManagement Co., Ltd., accounting for 100% of its registered capital. Since August 2022, the Company hasincorporated Jiangsu Azure Shangyin Catering Management Co., Ltd. into the consolidated scope of theconsolidated financial statements.
(4) In August 2022, the company subscribed capital of CNY 3.00 billion to establish Jiangsu Yanghe DreamInvestment Management Co., Ltd., accounting for 100% of its registered capital. Jiangsu Yanghe DreamInvestment Management Co., Ltd. has been included in the consolidated scope of the consolidated financialstatements since August 2022.
(5) In September 2022, Jiangsu Yanghe Dream Investment Management Co., LTD., the holding subsidiary,invested CNY 10.00 million to establish Jiangsu Yanghe Blue Investment Management Co., Ltd., accounting for
100.00% of its registered capital. Since September 2022, the company has included Jiangsu Yanghe BlueInvestment Management Co., Ltd. in the consolidated scope of the consolidated financial statements.
2. Cancellation of subsidiaries
(1) In September 2022, the holding subsidiary Jiangsu Kelite Biotechnology Research Institute Co., Ltd. wasderegested and will no longer be included in the consolidated scope of the consolidated financial statementsfrom October 2022.
(2) In November 2022, Guizhou Guijiu Liquor Operation and Management Co., LTD., the holding subsidiary,was liquidated and cancelled, and it will no longer be included in the consolidated scope of the consolidatedfinancial statements from December 2022.
8. Engagement and Disengagement of the CPA firm
CPA firm engaged at present
Name of domestic accounting firm | Suya Jincheng CPA LLP. |
Remuneration of domestic accounting firm (CNY10,000) | 190.8 |
Consecutive years of audit services of domestic accounting firms | 16 |
The name of the certified public accountant of the domestic accounting firm | Li Laimin, Li Yan |
Consecutive years of auditing services by certified public accountants of domestic accounting firms | Li Laimin: 3 years; Li Yan: 4 years |
Whether to change the CPA firm in the current period
□ Yes √ No
Engagement of internal control audit CPA firm, financial advisor or sponsor
√ Applicable □ N/A
During the reporting period, the Company hired Suya Jincheng CPA LLP. as the internal control audit accountingfirm, and paid a total of CNY 530,000 of financial consulting fees during the period.
9. Facing delisting after annual report disclosure
□ Applicable √ N/A
10. Bankruptcy and Restructuring
□ Applicable √ N/ANo such case during the reporting period.
11. Material Litigations and Arbitration
□ Applicable √ N/A
The Company had no material litigation or arbitration during the current reporting period.
12. Punishment and rectification
□ Applicable √ N/A
No such case during the reporting period.
13. The integrity of the company and its controlling shareholders and actual controllers
□ Applicable √ N/A
14. Significant Related-party Transactions
14.1 Related-party Transactions Arising from Routine Daily Operations
□ Applicable √ N/A
No such case during the reporting period.
14.2 Related-party Transactions regarding Purchase and Disposal of Assets or Equity
□ Applicable √ N/A
No such case during the reporting period.
14.3 Significant Related-party Transactions Arising from Joint Investments on External Parties
□ Applicable √ N/A
No such case during the reporting period.
14.4 Related Credit and Debt Transactions
□ Applicable √ N/A
No such case during the reporting period.
14.5 Transactions with related financial companies
□ Applicable √ N/A
No such case during the reporting period.
14.6 Transactions between the financial company controlled by the company and related parties
□ Applicable √ N/A
There is no deposit, loan, credit or other financial business between the financial company controlled by theCompany and its related parties.
14.7 Other significant related-party transactions
□ Applicable √ N/A
The company has no other significant related transactions during the reporting period.
15. Significant Contracts and Their Execution
15.1 Trusteeship, Contracting and Leasing
(1)Trusteeship
□ Applicable √ N/A
No such case in the reporting period.
(2)Contracting
□ Applicable √ N/A
No such case in the reporting period.
(3)Leasing
□ Applicable √ N/A
No such case in the reporting period.
15.2 Significant Guarantees
□ Applicable √ N/A
No such case in the reporting period.
15.3 Entrusting Others to Manage Cash Assets
(1)Entrusted financial management
√ Applicable □ N/A
Overview of entrusted wealth management during the reporting period
Unit: CNY10, 000
Product types | Source of funds | Amount | Outstanding balance | Amount not collected after the due date | Amount of impairment accrued owing to overdue financial management |
Bank wealth management products | Private funds | 1,192,000 | 800,000 | 0 | 0 |
Trust wealth management products | Private funds | 208,285.29 | 27,500 | 7,269.55 | 6,512.85 |
Total | 1,400,285.29 | 827,500 | 7,269.55 | 6,512.85 |
Specific circumstances of high-risk entrusted wealth management with a single large amount or low security and
low liquidity
√ Applicable □ N/A
Unit: CNY10, 000
Trustee name | Type of Trustee (or Trustee) | Type | Amount | Sources of funds | Start date | End date | Investment direction | Remuneration determination method | Reference annualized rate of return | Expected earnings (if any) | Actual profit and loss amount during the reporting period | The actual recovery of profit and loss during the reporting period | Amount of provision for impairment (if any) | Whether it has gone through legal procedures | Is there any entrusted financial plan in the future | An overview of the matter and an index of related queries (if any) |
CITIC Trust | Trust | CITIC Trust ? Jiahe No. 118 Evergrande Guiyang New | 6,512.85 | Private funds | May 29, 2020 | November 29, 2021 | Debt assets | Cash | 7.60% | 1,085.97 | 2,201.31 | 1341.14 | 6,512.85 | Yes | Yes | The trust financing expires, and part of the principal and income are deferred. For details, please refer to the "Announcement on the Deferred Payment of the Expired |
WorldAccumulativeFundTrustPla
n
World Accumulative Fund Trust Plan | Principal and Income of Entrusted Wealth Management" disclosed by the company on December 4, 2021 (Announcement No. 2021-044) | |||||||||||||||
AVIC Trust | Trust | AVIC Trust ? Tianxin Bay Area Renewal No. 10 | 10,000 | Private funds | February 26, 2021 | February 26, 2023 | Equity assets | Cash | 8.50% | 1,700 | 1,567.26 | 691.64 | 5,000 | Yes | Yes | The trust financing extends, and part of the principal and income are deferred. For details, please refer to the "Announcement on the Deferred |
CollectiveFundTrustPlanPhase 1
Collective Fund Trust Plan Phase 1 | Payment of the Expired Principal and Income of Entrusted Wealth Management" disclosed by the company on March 18, 2023 (Announcement No. 2023-003) | |||||||||||||||
AVIC Trust | AVIC Trust | AVIC Trust ? Tianxin Bay Area Renewal | 10,000 | Private funds | March 1, 2021 | March 1, 2023 | Equity assets | Cash | 8.50% | 1,700 | 1,560.27 | 684.66 | 5,000 | Yes | Yes | The trust financing extends, and part of the principal and income are deferred. For details, please refer to the "Announce |
No.
CollectiveFundTrustPlanPhase 2
No. 10 Collective Fund Trust Plan Phase 2 | ment on the Deferred Payment of the Expired Principal and Income of Entrusted Wealth Management" disclosed by the company on March 18, 2023 (Announcement No. 2023-003) | ||||||||||||||
Total | 26,512.85 | -- | -- | -- | -- | -- | -- | 4,485.97 | 5,328.84 | -- | 16,512.85 | -- | -- | -- |
Entrust finance expected to be failed to recover principle or other situation leading to impairment
√ Applicable □ N/A
The “CITIC Trust Jiahe No. 118 Evergrande Guiyang New World Collective Fund Trust Plan” purchased by the company extended. Based on the principle ofprudence, the company handles changes in fair value. The amount of impairment accrued during the reporting period was CNY 28.8718 million, and the amount ofimpairment accrued by the end of the reporting period was CNY 65.1285 million.
The “AVIC Trust ? Tianxin Bay Area Renewal No. 10 Collective Fund Trust Plan Phase 1”, “AVIC Trust ? Tianxin Bay Area Renewal No. 10 Collective Fund Trust PlanPhase 2” purchased by the company extended. Based on the principle of prudence, the company handles changes in fair value. The amount of impairment accruedduring the reporting period was CNY 50 million, and the amount of impairment accrued by the end of the reporting period was CNY 100 million.
(2)Entrusted loan management
□ Applicable √ N/A
No such case during the reporting period
15.4 Other major contracts
□ Applicable √ N/A
No such case during the reporting period
16. Explanation of other significant matters
√ Applicable □ N/A
1、The company indirectly holds the partnership shares of Jiangsu Jiequan Emerging Industry DevelopmentFund (Limited Partnership) by investing in Jiangsu Xinghe Investment Management Co., Ltd. and NanjingXingnahe Venture Capital Partnership (Limited Partnership). Xingnahe Partnership and Jiequan Fund havecompleted the Raised and completed the filing with the Asset Management Association of China, the filing codesare SCF515 and SCL005 respectively. For details, please refer to the "Announcement on Cooperative Investmentwith Professional Investment Institutions" (Announcement No.: 2017-021) and "Progress Announcement onCooperative Investment with Professional Investment Institutions" disclosed by the company on December 30,2017 and April 12, 2018 (Announcement No.: 2018-011).
2、The wholly-owned subsidiary of the company, Sujiu Group Jiangsu Wealth Management Co., Ltd.subscribed for the partnership shares of Suzhou Danqing Phase II Innovative Pharmaceutical Industry InvestmentPartnership (Limited Partnership). Danqing Phase II has completed the fundraising and completed the filing withthe China Securities Investment Fund Industry Association, the filing code is SED720. For details, please refer tothe "Announcement on Cooperative Investment with Professional Investment Institutions" (Announcement No.:
2018-021), "About Announcement on the Progress of Cooperative Investment with Investment Institutions(Announcement No.: 2018-030), "Announcement on the Progress of Cooperative Investment with ProfessionalInvestment Institutions" (Announcement No.: 2019-004).
3、Jiangsu Yanghe Investment Management Co., Ltd. subscribed for the partnership share of Panmao(Shanghai) Investment Center (Limited Partnership). Panmao Investment has completed the fundraising andcompleted the filing with the Asset Management Association of China, the filing code is SED720. For details,please refer to the "Announcement on Cooperative Investment with Professional Investment Institutions"disclosed by the company on June 22, 2018 (announcement number: 2018-025).
4、Jiangsu Yanghe Investment Management Co., Ltd. subscribed for the partnership shares of Jiangsu ZijinHongyun Health Industry Investment Partnership (Limited Partnership), Suqian Yida Industrial Venture CapitalFund (Limited Partnership), and Hunan Huaye Tiancheng Venture Capital Partnership (Limited Partnership). ZijinHongyun, Suqian Yida and Huaye Tiancheng have completed the fundraising and completed the filing with theAsset Management Association of China. The filing codes are SGA436, SGV275 and SGW727 respectively. Fordetails, please refer to the "Announcement on Cooperative Investment with Professional InvestmentInstitutions" (Announcement No.: 2019-002) disclosed by the company on March 28, 2019, and "AboutParticipating in Investment in Suqian Yida Industrial Venture Capital" disclosed on April 30, 2019 Announcement
on Funds and Related Party Transactions” (Announcement No.: 2019-012), and “Announcement on Subscriptionof Hunan Huaye Tiancheng Venture Capital Fund” disclosed on September 6, 2019 (Announcement No.:
2019-021).
5、Jiangsu Yanghe Investment Management Co., Ltd. indirectly holds the partnership share of NanjingXingnaheyuan Venture Capital Partnership (Limited Partnership) by subscribing to Nanjing Xingnahai EquityInvestment Partnership (Limited Partnership), and Jiangsu Yanghe Investment Management Co., Ltd. subscribesfor Suzhou The partnership shares of Zhongxing Fushuzhi Venture Capital Partnership (Limited Partnership) andNanjing Hongyang Equity Investment Partnership (Limited Partnership), Xingna Heyuan, Suzhou Xingfu andNanjing Hongyang have completed the fundraising and invested in China Securities Investment Fund Theindustry association has completed the filing, and the filing codes are SLR472, SNC111, and SNF086. For details,please refer to the "Announcement on Cooperative Investment with Professional Investment Institutions"(Announcement No.: 2020-031) disclosed by the company on August 12, 2020, and the "About Subscription ofSuzhou Zhongxin Fushuzhi Entrepreneurship" disclosed on October 19, 2020 Investment Fund Announcement(Announcement No.: 2020-035), and the Announcement on Subscription of Nanjing Hongyang Equity InvestmentFund (Announcement No.: 2020-038) disclosed on November 4, 2020. Suzhou Xingfu and Nanjing Hongyangcompleted the fundraising scale of CNY 1.5 billion and CNY 230 million respectively.
6、Jiangsu Yanghe Investment Management Co., Ltd. subscribed for the partnership share of Zhuhai HengqinHuaye Tiancheng Phase IV Venture Capital Partnership (Limited Partnership), Xiamen Yuanfeng Equity InvestmentFund Partnership (Limited Partnership), and Shanghai Yunfeng Xincheng Investment Center (Limited Partnership).Huaye Phase IV, Xiamen Yuanfeng and Yunfeng Xincheng have completed the filing with the Asset ManagementAssociation of China. The filing codes are SQB769, SLX842 and SH1000 respectively. For details, please refer tothe "Announcement on Subscribing Zhuhai Hengqin Huaye Tiancheng Phase IV Venture Capital Fund" disclosedby the company on February 10, 2021 (Announcement No.: 2021-007), and the "About Subscription to Xiamen"disclosed on April 13, 2021 Yuanfeng Equity Investment Fund Announcement (Announcement No.: 2021-012),and the Announcement on Cooperative Investment with Professional Investment Institutions disclosed onAugust 6, 2021 (Announcement No.: 2021-033). Huaye Phase IV and Xiamen Yuanfeng completed the fundraisingscale of CNY 1.899 billion and CNY 20 billion respectively.
7. Jiangsu Yanghe Blue Investment Management Co., Ltd. and Jiangsu Yanghe Dream InvestmentManagement Co., Ltd. subscribe for the partnership shares of Nanjing Huatai Yanghe Equity Investment MotherFund (limited partnership). Huatai Yanghe Mother Fund has completed the filing in Asset ManagementAssociation of China with the filing code of SXY168. For details, please refer to the "Announcement on theestablishment of wholly-owned subsidiaries and Cooperative Investment with Professional InvestmentInstitutions" disclosed by the company on August 10, 2022 (Announcement No.: 2022-017), and the "ProgressAnnouncement on the establishment of wholly-owned subsidiaries and Cooperative Investment withProfessional Investment Institutions" disclosed by the company on September 28, 2022 (Announcement No.:
2022-020), and the "Progress Announcement on the establishment of wholly-owned subsidiaries andCooperative Investment with Professional Investment Institutions" disclosed by the company on December 17,2022 (Announcement No.: 2022-024).
17. Significant Events of the Company's Subsidiaries
□ Applicable √ N/A
Section VII Changes in Shares and ShareholdersI、Changes in shares
1、Table of Changes in Share Capital
Unit:share
Before the change | Changes in the period (+, -) | After the change | |||||||
Shares | Ratio | New Shares Issued | Bonus issue | Share transferred from capital reserve | Others | Sub-total | Shares | Ratio | |
1. Shares subject to conditional restriction(s) | 253,757,986 | 16.84% | 0 | 0 | 0 | -248,065,854 | -248,065,854 | 5,692,132 | 0.38% |
1.1 State holdings | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
1.2 Shares held by State-owned corporate | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
1.3. Other domestic holdings | 253,757,986 | 16.84% | 0 | 0 | 0 | -248,065,854 | -248,065,854 | 5,692,132 | 0.38% |
Including: held by domestic corporates | 249,480,000 | 16.55% | 0 | 0 | 0 | -249,480,000 | -249,480,000 | 0 | 0.00% |
held by domestic natural persons | 4,277,986 | 0.28% | 0 | 0 | 0 | 1,414,146 | 1,414,146 | 5,692,132 | 0.38% |
4. Foreign shares | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
Including: held by overseas corporates | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
held by overseas natural person | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
2. Shares without restriction | 1,253,230,014 | 83.16% | 0 | 0 | 0 | 248,065,854 | 248,065,854 | 1,501,295,868 | 99.62% |
2.1 RMB ordinary shares | 1,253,230,014 | 83.16% | 0 | 0 | 0 | 248,065,854 | 248,065,854 | 1,501,295,868 | 99.62% |
2.2 Domestically listed foreign shares | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
2.3 Foreign shares listed overseas | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
2.4 Others | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% |
3. Total shares | 1,506,988,000 | 100.00% | 0 | 0 | 0 | 0 | 0 | 1,506,988,000 | 100.00% |
Reason for share changes
√ Applicable □ N/A
Changes in shares were mainly due to changes in the shares locked by the current and outgoing directors,supervisors and senior managers of the company.
Approval for changes in share capital
□ Applicable √ N/A
Transfer for changes in share capital
□ Applicable √ N/A
Effects of changes in share capital on the basic earnings per share ("EPS"), diluted EPS, net assets per shareattributable to common shareholders of the Company, and other financial indexes over the last year and lastperiod
□ Applicable √ N/A
Other contents that the Company considers necessary or required by the securities regulatory authorities todisclose
□ Applicable √ N/A
2、Changes in Restricted Shares
√ Applicable □ N/A
Unit:share
Name of shareholder | Opening restricted shares | Increased in current period | Vested in current period | Closing restricted shares | Note for restricted shares | Date of unlocking |
Zhou Xinhu | 2,158,718 | 719,573 | 0 | 2,878,291 | Lock in upon director's departure | Sales restrictions were not lifted during the reporting period. On March 7, 2023, 25% of the shares held were lifted from restrictions on sale, and the remaining shares that have not been lifted from |
restrictions onsale will belifted inaccordancewith relevantregulations.
restrictions on sale will be lifted in accordance with relevant regulations. | ||||||
Cong Xuenian | 2,083,718 | 694,573 | 0 | 2,778,291 | Lock in upon director's departure | Sales restrictions were not lifted during the reporting period. On March 30, 2023, 25% of the shares held were lifted from restrictions on sale, and the remaining shares that have not been lifted from restrictions on sale will be lifted in accordance with relevant regulations. |
Jiangsu Blue Alliance Co., Ltd | 249,480,000 | 0 | 249,480,000 | 0 | Previously issued shares before initial public offering | August 9, 2022 |
Total | 253,722,436 | 1,414,146 | 249,480,000 | 5,656,582 | -- | -- |
II.Issuance and Listing of Securities
1. Securities (exclude Preferred Share) Issued during the Reporting Period
□ Applicable √ N/A
2.Explanation on Changes in Share Capital & the Structure of Shareholders, the Structure of Assets andLiabilities
□ Applicable √ N/A
3.Existent Shares Held by Internal Staff of the Company
□ Applicable √ N/A
III、Particulars about the Shareholders and Actual Controller
1.Total Number of Shareholders and Their Shareholdings
Unit:share
Total number of common shareholders at the end of the reporting period | 124,744 | Total number of common shareholders at the end of the previous month prior to the annual report disclosure date | 118,381 | The total number of preferred shareholders whose voting rights have been restored at the end of the reporting period (if any) (see Note 8) | 0 | The total number of preference shareholders whose voting rights have been restored at the end of the previous month before the disclosure date of the annual report (if any) (see Note 8) | 0 | ||||||
Shareholders who hold more than 5% of total shares or the top 10 shareholders | |||||||||||||
Name of Shareholders | Nature of shareholders | Share-holding percentage (%) | Total common shares held at the end of the reporting period | Increase/decrease during the reporting period | Number of restricted shares held | Number of unrestricted shares held | Pledge, marking or freezing | ||||||
Status | Amount | ||||||||||||
Jiangsu Yanghe Group Co., Ltd. | State-owned legal person | 34.16% | 514,858,939 | 0 | 0 | 514,858,939 | |||||||
Jiangsu Blue Alliance Co., Ltd. | Domestic Non-state-own | 17.58% | 264,991,926 | 0 | 0 | 264,991,926 |
ed legal person
ed legal person | ||||||||
Shanghai Haiyan Logistics Development Co., Ltd. | State-owned legal person | 9.67% | 145,708,137 | 0 | 0 | 145,708,137 | ||
Shanghai Jieqiang Tobacco Sugar & Wine (Group) Co., Ltd. | State-owned legal person | 3.96% | 59,744,099 | 0 | 0 | 59,744,099 | ||
Bank of China Limited - China Merchants CSI Baijiu Index Classified Securities Investment Fund | Others | 2.91% | 43,787,041 | -6450418 | 0 | 43,787,041 | ||
Hong Kong Securities Clearing Company Limited | Overseas legal persons | 2.48% | 37,367,730 | 3940757 | 0 | 37,367,730 | ||
Bank of China Limited - E Fund Blue Chip Selected Mixed Securities Investment Fund | Others | 2.20% | 33,200,000 | -4500000 | 0 | 33,200,000 | ||
China Securities Finance Corporation Limited | Domestic Non-state-owned legal person | 0.92% | 13,790,044 | 0 | 0 | 13,790,044 | ||
Bank of China Limited - E Fund Premium Selected Hybrid Securities Investment Fund | Others | 0.72% | 10,820,000 | 819930 | 0 | 10,820,000 | ||
Yanghe Distillery Co., LTD-The first phase of | Others | 0.61% | 9,118,384 | 9118384 | 0 | 9,118,384 |
the corebackboneshareholdingplan
the core backbone shareholding plan | ||||
Strategic investors or general legal persons becoming the top 10 shareholders due to placement of new shares (if any) (see Note 3) | NO | |||
Explanation of the related relationship or concerted action of the above shareholders | NO | |||
Explanation of the above-mentioned shareholders involving entrusted/entrusted voting rights and abstention from voting rights | NO | |||
Special instructions for the existence of a special repurchase account among the top 10 shareholders (if any) (see Note 10) | NO | |||
Shareholdings of the top 10 shareholders without restrictions on sales | ||||
Name of shareholders | Number of unrestricted shares held at the end of the reporting period | Type of shares | ||
Type | Amount | |||
Jiangsu Yanghe Group Co., Ltd. | 514,858,939 | RMB common shares | 514,858,939 | |
Jiangsu Blue Alliance Co., Ltd | 264,991,926 | RMB common shares | 264,991,926 | |
Shanghai Haiyan Logistics Development Co., Ltd. | 145,708,137 | RMB common shares | 145,708,137 | |
Shanghai Jieqiang Tobacco Sugar & Wine (Group) Co., Ltd. | 59,744,099 | RMB common shares | 59,744,099 | |
Bank of China Limited-China Merchants CSI Liquor Index Graded Securities Investment Fund | 43,787,041 | RMB common shares | 43,787,041 | |
Hong Kong Securities Clearing Co., Ltd | 37,367,730 | RMB common shares | 37,367,730 |
Bank of China Limited-E FundBlue Chip Selected MixedSecurities Investment Fund
Bank of China Limited-E Fund Blue Chip Selected Mixed Securities Investment Fund | 33,200,000 | RMB common shares | 33,200,000 |
China Securities Finance Co., LTD | 13,790,044 | RMB common shares | 13,790,044 |
Bank of China Limited-E Fund Premium Selected Hybrid Securities Investment Fund | 10,820,000 | RMB common shares | 10,820,000 |
Yanghe Distillery Co., LTD-The first phase of the core backbone shareholding plan | 9,118,384 | RMB common shares | 9,118,384 |
Description of the connected relationship or concerted action among the top 10 shareholders of unrestricted tradable shares, and between the top 10 shareholders of unrestricted tradable shares and the top 10 shareholders | NO | ||
Explanation on the participation of the top 10 ordinary shareholders in the securities margin trading (if any) (see Note 4) | NO |
Any of the Company’s top 10 common shareholders or top 10 non-restricted common shareholders conductedany agreed buy-back in the reporting period?
□ Yes √ No
No such case during the current reporting period.
2. Particulars about Controlling Shareholder of the Company
Nature of controlling shareholder: local state-owned holdingType of controlling shareholder: Corporation
Name of Controlling Shareholder | Legal representative/ People in charge | Date of establishment | Organization Code | Business scope |
Jiangsu Yanghe Group Co., LTD | Yang Weiguo | 8 May, 1997 | 91321300142334989Y | Sales of brewing machinery and equipment, various raw and auxiliary materials, equipment and parts required for wine export and import |
production, industrialinvestment; municipalpublic works, housingconstruction projects,tourism and culturalindustry investment.
production, industrialinvestment; municipalpublic works, housingconstruction projects,tourism and culturalindustry investment.
Change of controlling shareholder during the reporting period
□ Applicable √ N/A
The Company's controlling shareholder has not changed during the reporting period.
3. Particulars about the Company’s Actual Controller & Concerted Parties
Nature of actual controller: local state-owned assets management organizationActual controller type: Corporation
Name of Actual Controller | Legal representative/ People in charge | Date of establishment | Organization Code | Business scope |
Suqian SASAC(State-owned Assets Supervision and Administration Commission) | Zhao Xiaoli | October 22, 2005 | N/A | On behalf of Suqian Municipal people's Government to execute the responsibilities of state-owned enterprise investors, implementing the supervision and management of state-owned assets and state-owned enterprises. |
The equity of other domestic and foreign listed companies controlled by the actual controller during the reporting period | N/A |
Change of the actual controller during the reporting period
□ Applicable √ N/A
No such change during the reporting period.The ownership and controlling relationship between the actual controller of the Company and the Company isdetailed as follows:
The actual controller controls the company through trust or other asset management methods
□ Applicable √ N/A
4. The Company's Controlling Shareholder or the Largest Shareholder and its Concerted Action Person'sCumulative Pledged Shares Account for 80% of the Company's Shares Held by Them
□ Applicable √ N/A
5. Particulars about Other Corporate Shareholders with Shareholding Proportion over 10%
√ Applicable □ N/A
Name of Actual Controller | Legal representative/ People in charge | Date of establishment | Organization Code | Business scope |
Jiangsu Blue Alliance Co., LTD | Cong Xuenian | 28 July, 2016 | CNY 105.6 million | Sales of daily necessities, biotechnology research and development, furniture production, business management consulting services, fruit tree planting, pre-packaged food sales. |
6. Particulars on Shareholding Decrease Restrictions for the Controlling Shareholders, Actual Controller,Restructurer or Other Committing Parties
□ Applicable √ N/A
IV. The specific implementation of share repurchases during the reporting period
The implementation progress of share repurchases
□ Applicable √ N/A
The implementation progress of reducing repurchased shares by centralized bidding
□ Applicable √ N/A
Section VIII Preferred Shares
□ Applicable √ N/A
There are no preferred shares in the company during the reporting period.
Section IX Bonds
□ Applicable √ N/A
Section X Financial ReportI. Auditor’s report
Type of audit report | Standard and unqualified opinion |
Date of signature | 24 April 2023 |
Name of Audit | Suya Jincheng CPA LLP. |
No. of auditor’s report | Suya Audit [2023] No.736 |
Names of auditors | Li Laimin, Li Yan |
Auditor’s ReportTo all the shareholders of Jiangsu Yanghe Distillery Co., Ltd.:
OpinionWe have audited the financial statements of Jiangsu Yanghe Distillery Co., Ltd. (hereinafterreferred to as the “Company”), which comprise the consolidated balance sheet and balancesheet as at 31 December 2022, consolidated income statement and income statement,consolidated cash flow statement and cash flow statement, consolidated statement of changesin owners' equity and statement of changes in owners' equity for the year then ended and notesto the financial statements.In our opinion, the attached financial statements are prepared, in all material respects, inaccordance with Accounting Standards for Business Enterprises and present fairly the financialposition of the company as at 31 December 2022 and its operating results and cash flow for theyear then ended.Basis for opinionWe conducted our audit in accordance with China Standards on Auditing (“CSAs”) for CertifiedPublic Accountants. Our responsibilities under those standards are further described in theAuditor's Responsibilities for the Audit of the Financial Statements section of our report. We areindependent of the Company in accordance with the Code of professional ethics for CertifiedPublic Accountants in China (“the Code”), and we have fulfilled our other ethical responsibilities inaccordance with the Code. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our opinion.Key audit mattersKey audit matters are those matters that, in our professional judgment, were of mostsignificance in our audit of the consolidated financial statements of the current period. Thesematters were addressed in the context of our audit of the consolidated financial statements as awhole and, in forming our opinion thereon, and we do not provide a separate opinion on thesematters.
1.Recognition of revenue | |
Please refer to note 28, “Accounting Policies” in NoteⅤ, "Significant Accounting Policies and Estimates" and note 38 in Note Ⅶ, "main Items of the Consolidated Financial Statements". | |
Key audit matters | How our audit addressed the key audit matter |
The Company’s specific condition ofrevenue recognition is that revenueis recognized after customeracceptance based on transfer ofcontrol. In 2022, the Company’sannual operating revenue wasCNY30.11 billion. The amountsubstantial and operating revenue isan important component of incomestatement. Therefore, we identifiedoperating revenue as a key auditmatter.
The Company’s specific condition of revenue recognition is that revenue is recognized after customer acceptance based on transfer of control. In 2022, the Company’s annual operating revenue was CNY30.11 billion. The amount substantial and operating revenue is an important component of income statement. Therefore, we identified operating revenue as a key audit matter. | Our procedures in relation to revenue recognition included: (1) Understood, tested and evaluated the effectiveness of internal control of sales and cash receipts cycle designed and executed by the management. (2) Through sampling inspection of the sales contract, identified the contractual rights and obligations, evaluated the point of time of performance obligations and evaluated whether the judgment of the transfer of control related to revenue recognition conforms to the Company's accounting policies and Accounting Standards for Business Enterprises. (3) Judged whether there is an abnormal fluctuation of revenue in the reporting period with the analytic review of revenue and gross profit margin in combination with product category. (4) Sampling inspection of supporting documents related to revenue recognition including sales contracts or orders, invoices, delivery lists or receiving reports, shipping lists and bank slips. (5) Implemented the external confirmation of selected major franchisers and inspected the payback of account receivables after the reporting period in combination with audit of accounts receivable and contract liabilities. (6) Sampling inspection of calculation and accounting treatment of sales discount and sales allowance. (7) Chose samples from sales revenue records before and after the balance sheet date, inspected related supporting documents and evaluated whether the revenue recorded in the appropriate accounting period. |
2. Existence, valuation and allocation of inventories | |
Please refer to note 11, “Accounting Policies” in Note Ⅴ, "Significant Accounting Policies and Estimates" and note 8 in Note Ⅶ, "main Items of the Consolidated Financial Statements". | |
Key audit matters | How our audit addressed the key audit matter |
As at 31 December 2022, the book value of inventory is CNY 17.73 billion, accounting for 26.09% of the total assets and 34.42% of all current assets. The book value of the inventories at year end is relatively large and accounts for a relatively large proportion of the total assets at the year end. Therefore, the existence, valuation and allocation of inventories are identified as a key audit matter. | Our procedures in relation to existence, valuation, allocation of inventories included: (1) Understood, tested and evaluated the effectiveness of management's design and implementation of inventory-related internal control. (2) Carried out the inventory analysis review procedure. (3) Supervised the inventory at the end of the period. (4) Sample check of production cost calculation table and other cost accounting data, and conducted valuation test on inventory, and evaluated the accuracy of closing balance of inventory. (5) Obtained the calculation table of provision for stock obsolescence, conduct the inventory impairment test, reviewed the inventory impairment test process, and checked whether the provision for stock obsolescence is made sufficiently. |
Other informationThe directors of the Company are responsible for the other information. The other informationcomprises the information included in the annual report, but does not include the financialstatements and our auditors report thereon.
Our opinion on the financial statements does not cover the other information and we do notexpress any form of assurance conclusion thereon.In connection with our audit of the financial statements, our responsibility is to read the otherinformation and, in doing so, consider whether the other information is materially inconsistentwith the financial statements or our knowledge obtained in the audit or otherwise appears to bematerially misstated.
If, based on the work we have performed, we conclude that there is a material misstatementof this other information; we are required to report that fact. We have nothing to report in thisregard.
Responsibilities of directors and those charged with governance for the financialstatements
The directors of the Company are responsible for the preparation of the financial statementsthat give a true and fair view in accordance with the disclosure requirements of AccountingStandards for Business Enterprises, and designing, implementing and maintaining internal controlthat is necessary to ensure the financial statements are free from material misstatement, whetherdue to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concernand using the going concern basis of accounting unless the directors either intend to liquidate theCompany or to cease operations, or have no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company’s financialreporting process.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as awhole are free from material misstatement, whether due to fraud or error, and to issue anauditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but isnot a guarantee that an audit conducted in accordance with CSAs will always detect a materialmisstatement when it exists. Misstatements can arise from fraud or error and are consideredmaterial if, individually or in the aggregate, they could reasonably be expected to influence theeconomic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with CSAs, we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:
(1) Identify and assess the risks of material misstatement of the financial statements,whether due to fraud or error, design and perform audit procedures responsive to those risks,and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.
The risk of not detecting a material misstatement resulting from fraud is higher than for oneresulting from error, as fraud may involve collusion, forgery, intentional omissions,misrepresentations, or the override of internal control.
(2) Obtain an understanding of internal control relevant to the audit in order to design auditprocedures that are appropriate in the circumstances.
(3) Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by the directors.
(4) Conclude on the appropriateness of the directors’ use of the going concern basis ofaccounting and, based on the audit evidence obtained, whether a material uncertainty existsrelated to events or conditions that may cast significant doubt on the Company’s ability tocontinue as a going concern. If we conclude that a material uncertainty exists, we are requiredto draw attention in our auditor’s report to the related disclosures in the financial statements or,if such disclosures are inadequate, to modify our opinion. Our conclusions are based on theaudit evidence obtained up to the date of our auditor’s report. However, future events orconditions may cause the Company to cease to continue as a going concern.
(5) Evaluate the overall presentation, structure and content of the financial statements,including the disclosures, and whether the financial statements represent the underlyingtransactions and events in a manner that achieves fair presentation.
(6) Obtain sufficient and appropriate audit evidence regarding the financial information ofthe entities or business activities within the Company to express an opinion on the financialstatements. We are responsible for the direction, supervision and performance of the groupaudit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, theplanned scope and timing of the audit and significant audit findings, including any significantdeficiencies in internal control that we identify during our audit.
We also provide the governance with a statement that we have complied with relevantethical requirements regarding independence, and to communicate with them all relationshipsand other matters that may reasonably be thought to bear on our independence, and whereapplicable, related safeguards.
From the matters communicated with the governance, we determine those matters thatwere of most significance in the audit of the consolidated financial statements of the currentperiod and are therefore the key audit matters. We describe these matters in our auditor’sreport unless law or regulation precludes public disclosure about the matter or when, inextremely rare circumstances, we determine that a matter should not be communicated in ourreport because the adverse consequences of doing so would reasonably be expected tooutweigh the public interest benefits of such communication.
Suya Jincheng CPA LLP
CPA of China: Li Laimin
CPA of China: Li Yan
Nanjing, China 24 April 2023II. Financial statements
Consolidated balance sheet
Prepared by: Jiangsu Yanghe Distillery Co., Ltd.
As at 31 December 2022
Unit: CNY
Item | On December 31st 2022 | On January 1st 2022 |
Current assets: | ||
Cash and bank balances | 24,375,449,432.33 | 20,955,831,010.12 |
Settlement reserves | ||
Lending funds | ||
Financial assets held for trading | 7,998,150,119.16 | 10,953,894,328.01 |
Derivative financial assets | ||
Notes receivables | 526,004,730.00 | 663,849,328.28 |
Accounts receivables | 45,142,892.78 | 1,247,949.91 |
Account receivables financing | 623,098,310.00 | 222,793,060.40 |
Prepayment | 11,019,093.60 | 9,408,768.12 |
Premiums receivable | ||
Reinsurance accounts receivable | ||
Reinsurance contract reserve | ||
Other receivables | 74,362,342.41 | 11,520,008.85 |
Including: Interests receivable | ||
Dividends receivable | ||
Buying back the sale of financial assets | ||
Inventories | 17,729,258,966.54 | 16,803,093,441.81 |
Contract assets | ||
Assets held for sale | ||
Non-current assets due within one year | ||
Other current assets | 129,687,990.26 | 143,005,191.58 |
Total current assets | 51,512,173,877.08 | 49,764,643,087.08 |
Non-current assets: | ||
Disbursement of loans and advances | ||
Investment in debt instruments |
Investment in other debtinstruments
Investment in other debt instruments | ||
Long-term receivables | ||
Long-term equity investments | 32,979,630.21 | 32,743,397.31 |
Investment in other equity instruments | ||
Other non-current financial assets | 6,148,634,160.78 | 7,635,942,149.06 |
Investment property | ||
Fixed assets | 5,794,773,069.53 | 6,276,466,308.05 |
Construction in progress | 757,145,492.90 | 525,497,000.26 |
Productive biological assets | ||
Oil and gas assets | ||
Right-of-use asset | 34,115,602.27 | 19,610,113.75 |
Intangible assets | 1,714,381,075.43 | 1,679,597,933.06 |
Development expenses | ||
Goodwill | 276,001,989.95 | 276,001,989.95 |
Long-term deferred expenses | 12,078,509.76 | 16,104,679.68 |
Deferred tax assets | 1,498,116,524.68 | 1,385,956,896.18 |
Other non-current assets | 183,847,201.84 | 186,140,639.38 |
Total non-current assets | 16,452,073,257.35 | 18,034,061,106.68 |
Total assets | 67,964,247,134.43 | 67,798,704,193.76 |
Current liabilities: | ||
Short-term loans | ||
Borrowings from the central bank | ||
Loans from other banks | ||
Financial liabilities held for trading | ||
Derivative financial liabilities | ||
Notes payable | 30,000,000.00 | |
Accounts payables | 1,376,209,527.01 | 1,444,175,262.08 |
Advance from customer | ||
Contract liabilities | 13,741,547,677.99 | 15,804,521,430.17 |
Financial assets sold for repurchase | ||
Customer brokerage deposits | ||
Securities underwriting brokerage deposits | ||
Receivings from vicariously sold securities | ||
Employee benefits payable | 482,991,738.73 | 536,717,129.16 |
Taxes payable | 1,136,695,805.18 | 3,061,385,171.71 |
Other payables | 1,854,922,517.23 | 1,808,838,882.26 |
Including: Interests payable | ||
Dividends payable | ||
Handling charges and commissions |
payable
payable | ||
Reinsurance accounts payables | ||
Liabilities held for sale | ||
Non-current liabilities due within one year | 23,684,406.75 | 8,405,846.77 |
Other current liabilities | 1,312,248,150.31 | 2,039,264,937.72 |
Total current liabilities | 19,928,299,823.20 | 24,733,308,659.87 |
Non-current liabilities: | ||
Insurance contract reserves | ||
Long-term loans | 36,360.00 | |
Bonds payable | ||
Including: Preference shares | ||
Perpetual bonds | ||
Lease liabilities | 3,715,300.93 | 10,729,824.19 |
Long-term payables | 196,459,834.53 | 196,694,194.53 |
Long-term payroll payables | ||
Accrued liabilities | ||
Deferred income | 92,277,166.67 | 77,242,500.00 |
Deferred tax liabilities | 219,046,405.35 | 299,382,397.38 |
Other non-current liabilities | ||
Total non-current liabilities | 511,498,707.48 | 584,085,276.10 |
Total liabilities | 20,439,798,530.68 | 25,317,393,935.97 |
Shareholders' equity | ||
Share capital | 1,506,988,000.00 | 1,506,988,000.00 |
Other equity instruments | ||
Including: preference shares | ||
Perpetual bonds | ||
Capital reserves | 904,650,678.91 | 782,236,370.14 |
Less: treasury stock | 56,278,680.79 | 56,278,680.79 |
Other comprehensive income | 1,981,678.95 | -5,843,990.29 |
Special reserves | ||
Surplus reserves | 753,494,000.00 | 753,494,000.00 |
General risk reserve | ||
Undistributed profits | 44,364,111,297.61 | 39,505,614,090.53 |
Total equity attributable to owners of the parent company | 47,474,946,974.68 | 42,486,209,789.59 |
Non-controlling interests | 49,501,629.07 | -4,899,531.80 |
Total owners' equity | 47,524,448,603.75 | 42,481,310,257.79 |
Total liabilities and owners' equity | 67,964,247,134.43 | 67,798,704,193.76 |
Legal representative: Zhang LiandongPerson in charge of accounting affairs: Yin QiumingPerson in charge of accounting department: Zhao Qike
Balance sheet of parent company
As at 31 December 2022
Unit: CNY
Item | On December 31st 2022 | On January 1st 2022 |
Current assets: | ||
Cash and bank balances | 23,231,793,606.79 | 19,908,620,924.68 |
Financial assets held for trading | 5,084,342,428.09 | 8,090,978,413.80 |
Derivative financial assets | ||
Notes receivables | 505,704,730.00 | 601,826,328.28 |
Accounts receivables | 1,204,161,788.24 | 424,595,684.45 |
Account receivables financing | 394,478,350.00 | 10,760,000.00 |
Prepayment | 51,616,255.75 | 76,366,400.75 |
Other receivables | 1,068,086,225.72 | 2,211,826,118.30 |
Including: Interests receivable | ||
Dividends receivable | 1,812,736,853.55 | |
Inventories | 11,550,551,319.29 | 11,289,319,403.65 |
Contract assets | ||
Assets held for sale | ||
Non-current assets due within one year | ||
Other current assets | 40,571,905.54 | |
Total current assets | 43,131,306,609.42 | 42,614,293,273.91 |
Non-current assets: | ||
Investment in debt instruments | ||
Investment in other debt instruments | ||
Long-term receivables | ||
Long-term equity investments | 8,180,436,290.49 | 7,994,556,728.17 |
Investment in other equity instruments | ||
Other non-current financial assets | 2,427,355,825.21 | 3,598,974,759.45 |
Investment property | ||
Fixed assets | 3,693,258,788.76 | 3,990,650,393.37 |
Construction in progress | 251,750,887.23 | 183,491,743.37 |
Productive biological assets |
Oil and gas assets
Oil and gas assets | ||
Right-of-use asset | 1,161,853.86 | 1,431,936.19 |
Intangible assets | 1,141,322,601.26 | 1,181,546,201.25 |
Development expenses | ||
Goodwill | ||
Long-term deferred expenses | 12,078,509.76 | 16,104,679.68 |
Deferred tax assets | 24,212,971.55 | 12,941,142.63 |
Other non-current assets | 163,216,415.72 | 164,332,861.20 |
Total Non-current Assets | 15,894,794,143.84 | 17,144,030,445.31 |
Total Assets | 59,026,100,753.26 | 59,758,323,719.22 |
Current liabilities: | ||
Short-term loans | ||
Financial liabilities held for trading | ||
Derivative financial liabilities | ||
Notes payable | ||
Accounts payables | 1,041,176,754.20 | 985,248,728.21 |
Advance from customer | ||
Contract liabilities | 17,485,085,741.24 | 21,199,823,390.34 |
Employee benefits payable | ||
Taxes payable | 377,457,671.93 | 643,076,598.44 |
Other payables | 3,762,682,905.35 | 1,842,392,622.94 |
Including: Interests payable | ||
Dividends payable | ||
Liabilities held for sale | ||
Non-current liabilities due within one year | 704,940.02 | 441,857.83 |
Other current liabilities | 2,688,940,410.36 | 3,300,680,288.13 |
Total current liabilities | 25,356,048,423.10 | 27,971,663,485.89 |
Non-current liabilities: | ||
Long-term loans | 36,360.00 | |
Bonds payable | ||
Including:preference shares | ||
Perpetual bonds | ||
Lease liabilities | 656,135.70 | 820,816.63 |
Long-term payables | 143,950,749.73 | 144,104,709.73 |
Long-term payroll payables | ||
Provisions | ||
Deferred income | 4,791,666.67 | 5,000,000.00 |
Deferred tax liabilities | 135,357,661.52 | 248,825,948.76 |
Other non-current liabilities | ||
Total non-current liabilities | 284,756,213.62 | 398,787,835.12 |
Total liabilities | 25,640,804,636.72 | 28,370,451,321.01 |
Owners' equity (or shareholders' |
equity)
equity) | ||
Share capital | 1,506,988,000.00 | 1,506,988,000.00 |
Other equity instruments | ||
Including: preference shares | ||
Perpetual bonds | ||
Capital reserves | 1,504,746,609.71 | 1,382,332,300.94 |
Less: treasury stock | 56,278,680.79 | 56,278,680.79 |
Other comprehensive income | ||
Special reserves | ||
Surplus reserves | 753,494,000.00 | 753,494,000.00 |
Undistributed profits | 29,676,346,187.62 | 27,801,336,778.06 |
Total owners' equity | 33,385,296,116.54 | 31,387,872,398.21 |
Total liabilities and owners' equity | 59,026,100,753.26 | 59,758,323,719.22 |
Consolidated Income StatementFor the year ended 31 December 2022
Unit: CNY
Item | Year 2022 | Year 2021 |
1. Total operating revenue | 30,104,896,186.70 | 25,350,178,204.45 |
Including: Operating revenue | 30,104,896,186.70 | 25,350,178,204.45 |
Interest income | ||
Earned premium | ||
Fee and commission income | ||
2. Total operating costs | 17,765,764,643.68 | 15,637,137,313.61 |
Including: cost of sales | 7,645,533,264.72 | 6,255,397,564.10 |
Interest expense | ||
Handling charges and commission expenses | ||
Refunded premiums | ||
Net payments for insurance claims | ||
Net provision for insurance contracts | ||
Bond insurance expense | ||
Reinsurance expenses | ||
Taxes and surcharges | 4,388,312,404.88 | 4,147,982,128.12 |
Selling and distribution expenses | 4,179,140,807.85 | 3,544,364,889.54 |
General and administrative expenses | 1,935,673,295.75 | 1,830,080,139.18 |
Research and Developmentexpenses
Research and Development expenses | 253,574,976.39 | 258,458,102.63 |
Financial expenses | -636,470,105.91 | -399,145,509.96 |
Including: Interest expenses | 694,325.50 | 603,755.58 |
Interest income | 645,806,427.40 | 433,923,395.67 |
Plus: Other income | 63,772,818.50 | 90,850,747.98 |
Investment income ("-" for losses) | 425,865,631.53 | 900,613,478.22 |
Including: income from investment in associates and joint ventures | 5,201,436.79 | 2,948,720.95 |
Disposal of financial instruments at a mortised cost ("-" for losses) | -13,584,025.11 | |
Foreign exchange gains ("-" for losses) | ||
Net exposure to hedging gains("-"for loss) | ||
Gains from the changes in fair values (“-“ for losses) | -318,331,123.43 | -721,212,806.81 |
Losses from credit impairment ("-" for losses) | -746,085.96 | 12,627,487.28 |
Losses from asset impairment ("-" for losses) | -2,333,823.54 | -7,175,293.45 |
Gains from disposal of assets ("-" for losses) | 1,846,300.27 | 184,684.97 |
3. Operating profits ("-" for losses) | 12,509,205,260.39 | 9,988,929,189.03 |
Plus: non-operating income | 25,586,332.71 | 20,718,383.00 |
Less: non-operating expenses | 31,507,701.73 | 63,220,053.35 |
4. Total profits before tax ("-" for total losses) | 12,503,283,891.37 | 9,946,427,518.68 |
Less: income tax expenses | 3,113,885,719.88 | 2,433,610,121.20 |
5. Net profit ("-" for net loss) | 9,389,398,171.49 | 7,512,817,397.48 |
Classification by operating continuity | ||
Net profit from continuing operation ("-" for losses) | 9,389,398,171.49 | 7,512,817,397.48 |
Net profit from discontinued operation ("-" for losses) | ||
Classification by owners | ||
Attributable to owners of the parent company | 9,377,832,429.08 | 7,507,682,797.40 |
Attributable to non-controlling interests | 11,565,742.41 | 5,134,600.08 |
6.Net of tax from other comprehensive income | 7,861,087.70 | -633,966.69 |
Net of tax from other comprehensive income to the owner of the parent company | 7,825,669.24 | -630,741.36 |
Other comprehensive income cannot reclassified into the profit and |
loss:
loss: | ||
Including: Changes in remeasured defined benefit obligations | ||
Share in other comprehensive income that cannot be classified into profit and loss under equity method | ||
Changes in the fair value of other equity instruments | ||
Fair value changes in enterprise's own credit risk | ||
Others | ||
Other comprehensive income that will be reclassified into the profit and loss | 7,825,669.24 | -630,741.36 |
Including: Share in other comprehensive income that will be classified into profit and loss under equity method | 153,503.58 | 10,293.63 |
Net gain on debt instruments at fair value through other comprehensive income | ||
The amount of financial assets reclassified into other comprehensive income | ||
Other debt investment credit impairment provision | ||
Cash flow hedging reserve | ||
Balance arising from the translation of foreign currency financial statements | 7,672,165.66 | -641,034.99 |
Others | ||
Net of tax from other comprehensive income to non-controlling interests | 35,418.46 | -3,225.33 |
7. Total comprehensive income | 9,397,259,259.19 | 7,512,183,430.79 |
Total comprehensive income attributable to owners of the parent company | 9,385,658,098.32 | 7,507,052,056.04 |
Total comprehensive income attributable to non-controlling interests | 11,601,160.87 | 5,131,374.75 |
8. Earnings per share | ||
(1) Basic earnings per share | 6.2251 | 5.0141 |
(2) Diluted earnings per share | 6.2251 | 5.0141 |
Where an enterprise is merged under the same control in the current period, the net profit realized by themerged party before the merger is: CNY 0.00, and the net profit realized by the merged party in the previousperiod is: CNY 0.00.
Legal representative: Zhang Liandong
Person in charge of accounting affairs: Yin Qiuming
Person in charge of accounting department: Zhao Qike
Income statement of parent companyFor the year ended 31 December 2022
Unit: CNY
Item | Year 2022 | Year 2021 |
1. Operating revenue | 11,492,807,889.95 | 10,476,842,189.83 |
Less: Cost of sales | 5,980,220,225.56 | 5,692,899,268.72 |
Taxes and surcharges | 3,545,342,923.46 | 3,418,193,216.10 |
Selling and distribution expenses | 8,061,097.87 | 4,350,000.19 |
General and administrative expenses | 1,066,652,613.72 | 953,846,877.96 |
Research and Development expenses | 251,317,786.01 | 255,876,693.41 |
Financial expenses | -599,586,816.00 | -360,797,750.83 |
Including: Interest expenses | 68,917.37 | 80,013.55 |
Interest income | 601,536,203.50 | 392,282,831.40 |
Plus: Other income | 12,864,187.98 | 35,355,375.48 |
Investment income ("-" for losses) | 5,820,859,899.66 | 4,025,167,004.11 |
Including: income from investment in associates and joint ventures | ||
Disposal of financial instruments at a mortised cost ("-" for losses) | -11,790,752.31 | |
Net exposure to hedging gains ("- "for loss) | ||
Gains from the changes in fair values (“-“ for losses) | -453,873,148.94 | -553,286,086.09 |
Losses from credit impairment ("-" for losses) | -343,834.00 | 1,133,079.28 |
Losses from asset impairment ("-" for losses) | -2,182,437.80 | -6,671,650.31 |
Gains from disposal of assets ("-" for losses) | 204,782.75 | 10,672.49 |
2. Operating profits ("-" For Losses) | 6,618,329,508.98 | 4,014,182,279.24 |
Plus: non-operating income | 5,673,709.03 | 2,129,227.09 |
Less: non-operating expenses | 17,026,160.31 | 26,922,264.60 |
3. Total profits before tax ("-" For Total Losses) | 6,606,977,057.70 | 3,989,389,241.73 |
Less: income tax expenses | 212,632,426.14 | -24,278,888.68 |
4. Net profit ("-" For Net Loss)
4. Net profit ("-" For Net Loss) | 6,394,344,631.56 | 4,013,668,130.41 |
Net profit from continuing operation ("-" for losses) | 6,394,344,631.56 | 4,013,668,130.41 |
Net profit from discontinued operation ("-" for losses) | ||
5.Net of tax from other comprehensive income | ||
Other comprehensive income cannot reclassified into the profit and loss: | ||
Including: Changes in remeasured defined benefit obligations | ||
Other comprehensive income that cannot be transferred under the equity method | ||
Net gain on equity instrument at fair value through other comprehensive income | ||
Fair value changes in enterprise's own credit risk | ||
Others | ||
Other comprehensive income that will be reclassified into the profit and loss | ||
Including: Share in other comprehensive income that will be classified into profit and loss under equity method | ||
Net gain on debt instruments at fair value through other comprehensive income | ||
The amount of financial assets reclassified into other comprehensive income | ||
Other debt investment credit impairment provision | ||
Cash flow hedging reserve | ||
Balance arising from the translation of foreign currency financial statements | ||
others | ||
6. Total comprehensive income | 6,394,344,631.56 | 4,013,668,130.41 |
7. Earnings per share | ||
(1)Basic earnings per share | ||
(2)Diluted earnings per share |
Consolidated Statement of Cash Flows
For the year ended 31 December 2022
Unit: CNY
Item | Year 2022 | Year 2021 |
1. Cash flows from operating activities | ||
Cash received from sale of goods and rendering of services | 30,888,040,308.39 | 36,809,670,762.29 |
Net increase in customer bank deposits and placement from banks and other financial institutions | ||
Net increase in loans from central bank | ||
Net increase in loans from other financial institutions | ||
Premiums received from original insurance contracts | ||
Net cash received from reinsurance business | ||
Net increase in deposits and investments from policyholders | ||
Cash received from interest, handling charges and commissions | ||
Net increase in placements from other financial institutions | ||
Net capital increase in repurchase business | ||
Net cash received for the sale of securities | ||
Refunds of taxes and surcharges | 3,060,026.48 | |
Cash received from other operating activities | 550,757,261.24 | 728,428,911.66 |
Sub-total of cash inflows from operating activities | 31,441,857,596.11 | 37,538,099,673.95 |
Cash paid for goods purchased and services received | 7,975,641,881.57 | 7,772,357,695.47 |
Net increase in loans and advances to customers | ||
Net increase in deposits in central bank and other banks and financial institutions | ||
Cash paid for original insurance contract claims | ||
A net increase in divested funds | ||
Cash paid for interests, handling charges and commissions |
Cash paid for policy dividends
Cash paid for policy dividends | ||
Cash paid to and on behalf of employees | 3,444,356,348.05 | 2,639,141,713.39 |
Cash paid for taxes and surcharges | 12,905,501,412.00 | 8,805,477,883.69 |
Cash paid for other operating activities | 3,468,734,002.30 | 3,002,956,900.87 |
Sub-total of cash outflows from operating activities | 27,794,233,643.92 | 22,219,934,193.42 |
Net cash flows from activities operating | 3,647,623,952.19 | 15,318,165,480.53 |
2. Cash flows from investing activities | ||
Cash received from disposal of investments | 17,261,152,475.37 | 27,266,561,244.92 |
Cash received from returns on investments | 420,664,194.74 | 897,664,757.27 |
Net cash received from disposal of fixed assets, intangible assets and other long-term assets | 5,625,033.85 | 6,072,909.38 |
Net cash received from disposal of subsidiaries and other business units | ||
Cash received from other investing activities | ||
Sub-total of cash inflows from investing activities | 17,687,441,703.96 | 28,170,298,911.57 |
Cash paid to acquire and construct fixed assets, intangible assets and other long-term assets | 539,153,153.61 | 423,524,255.39 |
Cash paid for investments | 13,131,786,086.81 | 25,910,110,341.89 |
Net increase in pledge loans | ||
Net cash paid to acquire subsidiaries and other business units | ||
Cash paid for other investing activities | ||
Sub-total of cash outflows from investing activities | 13,670,939,240.42 | 26,333,634,597.28 |
Net cash flows from investing activities | 4,016,502,463.54 | 1,836,664,314.29 |
3. Cash flows from financing activities | ||
Cash received from investors | 42,800,000.00 | 4,900,000.00 |
Including: cash received by subsidiaries from investments by minority shareholders | 42,800,000.00 | 4,900,000.00 |
Cash received from borrowings | ||
Cash received from other financing activities | 945,850,000.00 | |
Sub-total of cash inflows from financing activities | 42,800,000.00 | 950,750,000.00 |
Cash paid for debt repayments | 36,360.00 |
Cash paid for distribution ofdividends and profits or payment ofinterest
Cash paid for distribution of dividends and profits or payment of interest | 4,519,335,876.00 | 4,491,980,070.00 |
Including: dividends and profits paid to minority shareholders by subsidiaries | ||
Cash paid for other financing activities | 15,204,742.60 | 6,587,740.77 |
Sub-total of cash outflows from financing activities | 4,534,576,978.60 | 4,498,567,810.77 |
Net cash flows from financing activities | -4,491,776,978.60 | -3,547,817,810.77 |
4. Effect of fluctuation in exchange rate on cash and cash equivalents | -336,446.78 | -3,194,795.97 |
5. Net increase in cash and cash equivalents | 3,172,012,990.35 | 13,603,817,188.08 |
Plus: balance of cash and cash equivalents at the beginning of the period | 20,847,003,550.37 | 7,243,186,362.29 |
6. Balance of cash and cash equivalents at the end of the period | 24,019,016,540.72 | 20,847,003,550.37 |
Cash flow statements of parent companyFor the year ended 31 December 2022
Unit: CNY
Item | Year 2022 | Year 2021 |
1. Cash flows from operating activities | ||
Cash received from sale of goods and rendering of services | 7,611,553,357.29 | 23,589,835,408.72 |
Refunds of taxes and surcharges | 3,060,026.48 | |
Cash received from other operating activities | 2,314,707,779.42 | 10,226,189,295.58 |
Sub-total of cash inflows from operating activities | 9,929,321,163.19 | 33,816,024,704.30 |
Cash paid for goods purchased and services received | 6,064,059,385.00 | 6,502,601,435.75 |
Cash paid to and on behalf of employees | 1,368,615,850.49 | 1,219,405,817.53 |
Cash paid for taxes and surcharges | 4,939,845,815.65 | 4,301,849,478.48 |
Cash paid for other operating activities | 967,712,898.60 | 287,132,938.87 |
Sub-total of cash outflows fromoperating activities
Sub-total of cash outflows from operating activities | 13,340,233,949.74 | 12,310,989,670.63 |
Net cash flows from activities operating | -3,410,912,786.55 | 21,505,035,033.67 |
2. Cash flows from investing activities | ||
Cash received from disposal of investments | 11,784,381,771.01 | 10,753,858,262.70 |
Cash received from returns on investments | 7,633,596,753.21 | 3,988,248,353.89 |
Net cash received from disposal of fixed assets, intangible assets and other long-term assets | 4,762,886.20 | 2,464,467.97 |
Net cash received from disposal of subsidiaries and other business units | ||
Cash received from other investing activities | ||
Sub-total of cash inflows from investing activities | 19,422,741,410.42 | 14,744,571,084.56 |
Cash paid to acquire and construct fixed assets, intangible assets and other long-term assets | 241,687,386.76 | 189,141,129.66 |
Cash paid for investments | 8,172,000,000.00 | 18,425,100,000.00 |
Net cash paid to acquire subsidiaries and other business units | ||
Cash paid for other investing activities | ||
Sub-total of cash outflows from investing activities | 8,413,687,386.76 | 18,614,241,129.66 |
Net cash flows from investing activities | 11,009,054,023.66 | -3,869,670,045.10 |
3. Cash flows from financing activities | ||
Cash received from investors | ||
Cash received from loans | ||
Cash received from other financing activities | 945,850,000.00 | |
Sub-total of cash inflows from financing activities | 945,850,000.00 | |
Cash paid for debt repayments | 36,360.00 | |
Cash paid for distribution of dividends and profits or payment of interest | 4,519,404,139.37 | 4,491,980,070.00 |
Cash paid for other financing activities | 703,669.72 | |
Sub-total of cash outflows from financing activities | 4,519,440,499.37 | 4,492,683,739.72 |
Net cash flows from financing activities | -4,519,440,499.37 | -3,546,833,739.72 |
4. Effect of fluctuation in exchange | 4,144,329.10 | -1,036,905.61 |
rate on cash and cash equivalents
rate on cash and cash equivalents | ||
5. Net increase in cash and cash equivalents | 3,082,845,066.84 | 14,087,494,343.24 |
Plus: balance of cash and cash equivalents at the beginning of the period | 19,800,847,429.16 | 5,713,353,085.92 |
6. Balance of cash and cash equivalents at the end of the period | 22,883,692,496.00 | 19,800,847,429.16 |
Consolidated statement of changes in shareholders' equity
For the year ended 31 December 2022
Unit: CNY
Item | Year 2022 | ||||||||||||||
Equity attributable to owners of the parent company | Non-controlling interests | Total shareholders' equity | |||||||||||||
Share capital | Other equity instruments | Capital reserve | Less :Treasury stock | Other Comprehensive Income | Special reserve | Surplus reserve | Genera l risk reserve | Undistributed profit | Others | Subtotal | |||||
Preferred stock | Perpetual bond | Others | |||||||||||||
1. Balance as at 31 December of last year | 1,506,988,000.00 | 782,236,370.14 | 56,278,680.79 | -5,843,990.29 | 753,494,000.00 | 39,505,614,090.53 | 42,486,209,789.59 | -4,899,531.80 | 42,481,310,257.79 | ||||||
Plus: adjustments for changes in accounting policies | |||||||||||||||
Adjustments for correction of accounting errors in prior year | |||||||||||||||
Business combinations under common control | |||||||||||||||
Others | |||||||||||||||
2. Balance as at January 1 of the current year | 1,506,988,000.00 | 782,236,370.14 | 56,278,680.79 | -5,843,990.29 | 753,494,000.00 | 39,505,614,090.53 | 42,486,209,789.59 | -4,899,531.80 | 42,481,310,257.79 | ||||||
3.Increases/decreases in the current | 122,414,308.77 | 7,825,669.24 | 4,858,497,207.08 | 4,988,737,185. | 54,401,160.87 | 5,043,138,345.96 |
year (“ -” fordecreases)
year (“ -” for decreases) | 09 | ||||||||||||||
(1) Total comprehensive income | 7,825,669.24 | 9,377,832,429.08 | 9,385,658,098.32 | 11,601,160.87 | 9,397,259,259.19 | ||||||||||
(2) Capital contributed or reduced by owners | 122,414,308.77 | 122,414,308.77 | 42,800,000.00 | 165,214,308.77 | |||||||||||
Capital contributions by owners | 42,800,000.00 | 42,800,000.00 | |||||||||||||
Capital contributions by other equity instruments holders | |||||||||||||||
Amounts of share-based payments recognized in owners' equity | 122,414,308.77 | 122,414,308.77 | 122,414,308.77 | ||||||||||||
Others | |||||||||||||||
(3) Profit distribution | -4,519,335,222.00 | -4,519,335,222.00 | -4,519,335,222.00 | ||||||||||||
Withdrawal of surplus reserves | |||||||||||||||
Withdrawal of general risk reserve | |||||||||||||||
Profit distributed to owners (or shareholders) | -4,519,335,222.00 | -4,519,335,222.00 | -4,519,335,222.00 | ||||||||||||
Others |
(4) Internal
carry-forward ofowners' equity
(4) Internal carry-forward of owners' equity | |||||||||||||||
Conversion of capital reserves into paid-in capital | |||||||||||||||
Conversion of surplus reserves into paid-in capital | |||||||||||||||
Surplus reserves offsetting losses | |||||||||||||||
Amount of Changes in setting benefit plan transfer to retained earnings | |||||||||||||||
Other comprehensive income transferred to retained earnings | |||||||||||||||
Others | |||||||||||||||
(5) Special reserves | |||||||||||||||
Withdrawal for the period | |||||||||||||||
Use for the period | |||||||||||||||
Others | |||||||||||||||
4. Balance as at 31 December of the current year | 1,506,988,000.00 | 904,650,678.91 | 56,278,680.79 | 1,981,678.95 | 753,494,000.00 | 44,364,111,297.61 | 47,474,946,974.68 | 49,501,629.07 | 47,524,448,603.75 |
Item | Year 2021 | ||||||||||||||
Equity attributable to owners of the parent company | Non- controlling interest s | Total shareholders' equity | |||||||||||||
Share capital | Other equity instruments | Capital reserve | Less :Treasury stock | Other Comprehensive Income | Special reserve | Surplus reserve | Genera l risk reserve | Undistributed profit | Others | Subtotal | |||||
Preferred stock | Perpetual bond | Other s | |||||||||||||
1. Balance as at 31 December of last year | 1,506,988,000.00 | 741,532,550.13 | 1,002,128,680.79 | -5,213,248.93 | 753,494,000.00 | 36,489,911,363.13 | 38,484,583,983.54 | -14,930,906.55 | 38,469,653,076.99 | ||||||
Plus: adjustments for changes in accounting policies | |||||||||||||||
Adjustments for correction of accounting errors in prior year | |||||||||||||||
Business combinations under common control | |||||||||||||||
Others | |||||||||||||||
2. Balance as at January 1 of the current | 1,506,988,000.00 | 741,532,550.13 | 1,002,128,680.79 | -5,213,248.93 | 753,494,000.00 | 36,489,911,363.13 | 38,484,583,983.54 | -14,930,906.55 | 38,469,653,076.99 |
year
year | |||||||||||||||
3.Increases/decreases in the current year (“ -” for decreases) | 40,703,820.01 | -945,850,000.00 | -630,741.36 | 3,015,702,727.40 | 4,001,625,806.05 | 10,031,374.75 | 4,011,657,180.80 | ||||||||
(1) Total comprehensive income | -630,741.36 | 7,507,682,797.40 | 7,507,052,056.04 | 5,131,374.75 | 7,512,183,430.79 | ||||||||||
(2) Capital contributed or reduced by owners | 40,703,820.01 | -945,850,000.00 | 986,553,820.01 | 4,900,000.00 | 991,453,820.01 | ||||||||||
Capital contributions by owners | 4,900,000.00 | 4,900,000.00 | |||||||||||||
Capital contributions by other equity Instruments holders | |||||||||||||||
Amounts of share-based payments recognized in owners' equity | 40,703,820.01 | -945,850,000.00 | 986,553,820.01 | 986,553,820.01 | |||||||||||
Others | |||||||||||||||
(3) Profit distribution | -4,491,980,070.00 | -4,491,980,070.00 | -4,491,980,070.00 | ||||||||||||
Withdrawal of surplus reserves |
Withdrawal of generalrisk reserve
Withdrawal of general risk reserve | |||||||||||||||
Profit distributed to owners (or shareholders) | -4,491,980,070.00 | -4,491,980,070.00 | -4,491,980,070.00 | ||||||||||||
Others | |||||||||||||||
(4) Internal carry-forward of owners' equity | |||||||||||||||
Conversion of capital reserves into paid-in capital | |||||||||||||||
Conversion of surplus reserves into paid-in capital | |||||||||||||||
Surplus reserves offsetting losses | |||||||||||||||
Carry-forward of retained earnings from changes in defined benefit plans |
Othercomprehensive incometransferredto retainedearnings
Other comprehensive income transferred to retained earnings | |||||||||||||||
Others | |||||||||||||||
(5) Special reserves | |||||||||||||||
Withdrawal for the period | |||||||||||||||
Use for the period | |||||||||||||||
(6) Others | |||||||||||||||
4. Balance as at 31 December of the current year | 1,506,988,000.00 | 782,236,370.14 | 56,278,680.79 | -5,843,990.29 | 753,494,000.00 | 39,505,614,090.53 | 42,486,209,789.59 | -4,899,531.80 | 42,481,310,257.79 |
Statement of changes in shareholders' equity of parent company
For the year ended 31 December 2022
Unit: CNY
Item | Year 2022 | |||||||||||
Share capital | Other equity instruments | Capital reserve | Less:Treasury stock | Other Comprehensive Income | Special reserve | Surplus reserve | Undistributed profit | Other s | Total shareholder s' equity | |||
Preferred stock | Perpetual bond | Others | ||||||||||
1. Balance as at 31 December of last year | 1,506,988,000.00 | 1,382,332,300.94 | 56,278,680.79 | 753,494,000.00 | 27,801,336,778.06 | 31,387,872,398.21 | ||||||
Plus: adjustments for changes in accounting policies | ||||||||||||
adjustments for correction of accounting errors in prior year | ||||||||||||
Others | ||||||||||||
2. Balance as at January 1 of the current year | 1,506,988,000.00 | 1,382,332,300.94 | 56,278,680.79 | 753,494,000.00 | 27,801,336,778.06 | 31,387,872,398.21 | ||||||
3.Increases/decreases in the current year (“ -” for decreases) | 122,414,308.77 | 1,875,009,409.56 | 1,997,423,718.33 | |||||||||
(1) Total comprehensive income | 6,394,344,631.56 | 6,394,344,631.56 | ||||||||||
(2) Capital contributed or reduced by | 122,414,308.77 | 122,414,308.77 |
owners
owners | ||||||||||||
Capital contributions by owners (common stock) | ||||||||||||
Capital contributions by other equity instruments holders | ||||||||||||
Amounts of share-based payments recognized in owners' equity | 122,414,308.77 | 122,414,308.77 | ||||||||||
Others | ||||||||||||
(3)Profit distribution | -4,519,335,222.00 | -4,519,335,222.00 | ||||||||||
Withdrawal of surplus reserves | ||||||||||||
Profit distributed to owners (or shareholders) | -4,519,335,222.00 | -4,519,335,222.00 | ||||||||||
Others | ||||||||||||
(4) Internal carry-forward of owners' equity | ||||||||||||
Conversion of capital reserves into paid-in capital | ||||||||||||
Conversion of surplus reserves into paid-in |
capital
capital | ||||||||||||
Surplus reserves offsetting losses | ||||||||||||
Amount of Changes in setting benefit plan transfer to retained earnings | ||||||||||||
Other comprehensive income transferred to retained earnings | ||||||||||||
Others | ||||||||||||
(5) Special reserves | ||||||||||||
Withdrawal for the period | ||||||||||||
Use for the period | ||||||||||||
(6) Others | ||||||||||||
4. Balance as at 31 December of the current year | 1,506,988,000.00 | 1,504,746,609.71 | 56,278,680.79 | 753,494,000.00 | 29,676,346,187.62 | 33,385,296,116.54 |
Item
Item | Year 2021 | |||||||||||
Share capital | Other equity instruments | Capital reserve | Less: Treasury stock | Other Comprehensive Income | Special reserve | Surplus reserve | Undistributed profit | Others | Total shareholder s' equity | |||
Preferred stock | Perpetual bond | Others | ||||||||||
1. Balance as at 31 December of last year | 1,506,988,000.00 | 1,341,628,480.93 | 1,002,128,680.79 | 753,494,000.00 | 28,279,648,717.65 | 30,879,630,517.79 | ||||||
Plus: adjustments for changes in accounting policies | ||||||||||||
adjustments for correction of accounting errors in prior year | ||||||||||||
Others | ||||||||||||
2. Balance as at January 1 of the current year | 1,506,988,000.00 | 1,341,628,480.93 | 1,002,128,680.79 | 753,494,000.00 | 28,279,648,717.65 | 30,879,630,517.79 | ||||||
3.Increases/decreases in the current year (“ -” for decreases) | 40,703,820.01 | -945,850,000.00 | -478,311,939.59 | 508,241,880.42 | ||||||||
(1) Total comprehensive income | 4,013,668,130.41 | 4,013,668,130.41 | ||||||||||
(2) Capital contributed or reduced by owners | 40,703,820.01 | -945,850,000.00 | 986,553,820.01 | |||||||||
Capital contributions by owners (common |
stock)
stock) | ||||||||||||
Capital contributions by other equity instruments holders | ||||||||||||
Amounts of share-based payments recognized in owners' equity | 40,703,820.01 | -945,850,000.00 | 986,553,820.01 | |||||||||
Others | ||||||||||||
(3)Profit distribution | -4,491,980,070.00 | -4,491,980,070.00 | ||||||||||
Withdrawal of surplus reserves | ||||||||||||
Profit distributed to owners (or shareholders) | -4,491,980,070.00 | -4,491,980,070.00 | ||||||||||
Others | ||||||||||||
(4) Internal carry-forward of owners' equity | ||||||||||||
Conversion of capital reserves into paid-in capital | ||||||||||||
Conversion of surplus reserves into paid-in capital | ||||||||||||
Surplus reserves offsetting losses | ||||||||||||
Amount of Changes in |
setting benefitplan transfer toretained earnings
setting benefit plan transfer to retained earnings | ||||||||||||
Other comprehensive income transferred to retained earnings | ||||||||||||
Others | ||||||||||||
(5) Special reserves | ||||||||||||
Withdrawal for the period | ||||||||||||
Use for the period | ||||||||||||
(6) Others | ||||||||||||
4. Balance as at 31 December of the current year | 1,506,988,000.00 | 1,382,332,300.94 | 56,278,680.79 | 753,494,000.00 | 27,801,336,778.06 | 31,387,872,398.21 |
III. Company profile
Jiangsu Yanghe Distillery Co., Ltd.(hereinafter referred to as “the Company”)was established on 26December 2002, verified by the Government of Jiangsu Province, details referred to Reply on The approval ofEstablishment of Jiangsu Yanghe Distillery Co., Ltd. by the provincial government (SuZhengFu [2002]No.155),and it was a company founded by Jiangsu Yanghe Group Co., Ltd., Shanghai Haiyan Logistics Development Co.,Ltd., Nantong Zongyi Investment Co., Ltd., Shanghai Jieqiang Tobacco Sugar & Wine (Group) Co., Ltd., JiangsuVenture Capital Co.,Ltd., China National Research Institute of Food and Fermentation Industries Co. Ltd.,Nantong Shengfu Industrial Trade Co., Ltd. and Yang Yandong and other totally 14 nature persons. On 27December, the Company obtained the unified social credit code (91460000201357188U) issued by JiangsuProvincial Administration for Industry and Commerce. The registered capital was CNY 68 million and the sharecapital was 68,000,000 (CNY 1 per share). According to the documents verified by Jiangsu ProvincialDepartment of Finance (Su Cai Guo Zi [2002] No.178), all the fund capital converts into share capital accordingto the ratio 1:0.65561,among which, Jiangsu Yanghe Group Co., Ltd contributed CNY 52,264,100 of evaluatedphysical assets and CNY 735,900 of currency, covered into 34,747,330 shares, accounting for 51.099% of thetotal share capital; Shanghai Haiyan Logistics Development Co., Ltd contributed CNY 15,000,000 of currency,covered into 9,834,150 shares, accounting for the 14.462% of the total share capital; Nantong ZongyiInvestment Co., Ltd. contributed CNY 15,000,000 of currency, converted into 9,834,150 shares, accounting for
14.462% of the total share capital; Shanghai Jieqiang Tobacco Sugar & Wine (Group) Co., Ltd. contributed CNY7,000,000 of currency converted into 4,589,270 shares, accounting for 6.749% of the total share capital;Jiangsu Venture Capital Co., Ltd . contributed CNY 3,000,000 of currency concerted into 1,966,830 shares,accounting for 2.892% of the total share capital; China National Research Institute of Food and FermentationIndustries Co. Ltd. contributed CNY 1,000,000 of currency, converted into 655,611 shares, accounting for 0.964%of the total share capital; Nantong Shengfu Industrial Trade Co., Ltd. contributed CNY 1,000,000 of currency,converted into 655,611 shares, accounting for 0.964% of the total share capital; Yang Yandong and othertotally 14 nature persons contributed CNY 8,720,200 of currency, converted into 5,717,050 shares, accountingfor 8.408% of the total share capital.
On 13 September 2009, the Company was verified by China Securities Regulatory Commission, accordingto the document Reply on Approving Initial Public Offering of Jiangsu Yanghe Distillery Co., Ltd. (Zheng JianApproval [2009] No.1077). The Company announced the initial public offering of 45,000,000 common shareson 27 February 2009 and was listed for transactions in SZSE since 6 November 2009.
According to the decisions of 2010 Shareholders’ General Meeting on 23 April 2011, based on the totalcapital of 450,000,000 shares on 31 December 2010, the capital reserves per 10 shares were converted into 10shares. After the conversion, the total share capital of the Company was 900,000,000 as well as registeredcapital of CNY 900,000,000.
According to the decision of 2011 Shareholders’ General Meeting on 17 May 2012, based on the totalcapital of 900,000,000 shares on 31 December 2011, the capital reserves per 10 shares were converted into 2shares. After the conversion, the total share capital of the Company was 1,080,000,000 as well as registeredcapital of CNY 108,000,000.
According to the Proposal of Initial Share Repurchase of Public Shares approved by 2012 Shareholders’General Meeting on 17 May 2013, the Company used owned funds to repurchase public shares and the priceof public shares was no more than CNY 70.00 per share, as well as the total amount of repurchase shares wasno more than CNY 10 billion. The form of repurchase was centralized competitive bidding approved by SZSE.Until May 2014, the amount of repurchase shares was 3,580,000 and the total amount of payment CNY
157,793,218.58. The shares repurchased had been canceled according to the law with the procedure of capitalreduction. After the repurchase, the registered capital became CNY 1,076,420,000 and the total share capitalof the Company became 1,076,420,000.According to the decision of 2014 Shareholders’ General Meeting on 26 May 2015, based on the totalcapital of 1,076,420,000 shares on 31 December 2014, the capital reserves per 10 shares were converted into4 shares. After the conversion, the total share capital of the company was 1,506,988,000 as well as theregistered capital of CNY 1,506,988,000.Registered address of the Company: 118 Middle Avenue, Yanghe Town, Suqian City, Jiangsu ProvinceCompany type: Incorporated company (Listed)Industry of the Company: Brewing food industryBusiness scope of the Company: production and sale of liquor, wholesaling and retailing of prepackagedfood, grain purchase, self-operating and agency of import and export of various types of merchandise andtechnology excluding merchandise and technology limited or prohibited by the state for import and export,domestic trade, construction of e- commerce platform and online sales. ( Business activities of projects neededto be approved by law must be approved according to related departments )Parent company of the Company:Jiangsu Yanghe Group Co.,Ltd.The scope of the Company's consolidated financial statements is based on control, and all subsidiaries areincluded in the consolidation scope of the consolidated financial statements.
Changes of the scope of consolidation are as follows:
1. Subsidiaries that are newly incorporated into the scope of consolidation are shown in the following table:
Name | Measure of acquisition |
Tibet Earth Third Pole Liquor Industry Co., Ltd | Newly establishment |
Guizhou Guijiu Liquor Industry Operation Co., Ltd | Newly establishment |
Jiangsu Weilan Shangyin Catering Management Co., Ltd | Newly establishment |
Jiangsu Yanghe Dream Investment Management Co., Ltd | Newly establishment |
Jiangsu Yanghe Blue Investment Management Co., Ltd | Newly establishment |
2. Subsidiaries that are not incorporated into the scope of consolidation are shown in the following table:
Name | Change method |
Jiangsu Kelite Biotechnology Research Institute Co., Ltd | deregistration |
Guizhou Guijiu Liquor Operations Management Co., Ltd | deregistration |
3. Details of the subsidiaries incorporated into the consolidated financial statements show on “Note 9.
1.Interests in subsidiaries”, Changes in the scope of consolidation show on “Note 8. Change in consolidatedscope”.IV. Basis of preparation of financial statements
1. Basis of preparation
The Company has prepared its financial statements on a going concern basis, and recognized andmeasured its accounting items in compliance with the Accounting Standards for Business Enterprises—BasicStandards and various concrete accounting standards, and other relevant provisions on the basis of actualtransactions and events.
2. Going concern
The Company has sustainable operation ability for at least 12 months from the end of the reportingperiod. In addition, there is no significant event affecting going concern.
V. Significant accounting policies and accounting estimates
The disclosure requirements of food and wine manufacturing-related industries in the Guidelines forSelf-regulation NO.3 of Listed Companies of Shenzhen Stock Exchange -Industry Information Disclosure shall beobserved
(1) Sales contract
The Company's sales products, promotional products and other goods belong to the performanceobligations performed at a certain point.
The Company recognizes the sales revenue when the goods are delivered to the customer and the controlof the goods is transferred. For export sales business, the Company recognizes the revenue after the goods aredelivered and the customs clearance procedures are completed.
According to the marketing policy, and the distributor sales of final product, the Company gives thedistributor a percentage discount, and regularly or irregularly settles with distributors. At the time of settlement,the discounts are recorded in a sales invoice issued. The net amount of invoice value after the deduction of thediscount sales income is recognized as revenue according to the accrual principle. The discounts that haveoccurred and have not yet been settled at the end of the current period shall be taken provision from the salesrevenue and recorded into the contract liabilities.
(2) Service Contract
The service contract provided by the Company contains the performance obligation of the lease serviceprovided. Since the customer obtains and consumes the economic benefits brought by the performance of thecontract at the same time, it is regarded as the performance obligation performed within a certain period oftime and is equally apportioned and confirmed during the service provision.
1. Statement of compliance with the ASBE
The financial statements of the Company have been prepared in accordance with ASBE, and present trulyand completely, the group’s financial position, the Company’s and results of operations, and changes inshareholders' equity, cash flows and other related information for the reporting period.
2. Accounting period
The Company’s accounting period is calendar year as its accounting year, i.e. from 1 January to 31December.
3. Operating cycle
The Company’s accounting period is 12 months.
4. Functional currency
The Company has adopted China Yuan (CNY) as functional currency.
5. The accounting treatment of business combinations involving enterprises under common control andnot under common control
(1) Accounting treatment method for business combination under common control
Business combination under common control is accounted for under pooling of interest method.
Assets and liabilities obtained by the Company through business combination under common control shallbe measured at the book value as stated in the combine’s accounting record on the combination date. Theshare of the book value of the merged party’s owner’s equity in the consolidated financial statements is takenas the initial investment cost of long-term equity investments in individual financial statements. The capitalreserve (stock premium or capital premium) is adjusted according to the difference between the book value of
net asset acquired through combination and the book value of consideration paid for the combination (or totalpar value of shares issued). If the capital reserve (stock premium or capital premium) is insufficient to offset,the retained earnings shall be adjusted.
(2) Accounting treatment method of business combination not under common controlThe Company accounts for business combination not under common control under purchase method.a) All the net identifiable assets, liabilities or contingent liabilities obtained by the Company throughbusiness combination not under common control shall be measured at fair value. Assets paid, liabilitiesincurred or assumed and the equity securities issued as consideration for combination are generally measuredat fair value on the acquisition date, and differences between their fair values and book values shall beincluded in the current profit and loss.b) The cost of acquisition shall be respectively determined for the following conditions;i. Business combination of a transaction implementation, the combination cost shall be the sum of the fairvalue of the assets given, the liabilities incurred or assumed and the equity securities issued by the Company inexchange for the control on the acquisition date, and contingent considerations meeting the recognitionconditions. The combination cost is the initial investment costs of long-term equity investments in individualfinancial statements.ii. Business combination through multiple transactions step by step to realized, the combination cost shallbe the sum of the fair value measurement on the acquisition of the equity investment that holding before theacquisition date and cost of all the new investment on the acquisition date. Long-term equity investment costin individual financial statements shall be the sum of the book value of the equity investment that holdingbefore the acquisition date and cost of all the new investment on the acquisition date. A package deal isexcluded.c) The Company, on the acquisition date, allocates the combination costs between the identifiable assetsand liabilities acquired
i. All assets of the acquiree obtained by the Company through business combination (not limited to thosethat have been recognized by the acquiree), other than intangible assets, shall be separately recognized andmeasured at fair value when the future economic benefits arising thereafter are expected to flow into theCompany and the fair value can be reliably measured.ii. Intangible assets of the acquiree obtained by the Company through business combination shall beseparately recognized and measured at fair value when their fair values can be reliably measured.iii. All liabilities of the acquiree obtained by the Company through business combination, other thancontingent liabilities, shall be separately recognized and measured at fair value when fulfillment of relevantobligations is expected to bring future economic benefits to the Company and the fair value can be reliablymeasured.iv. Contingent liabilities of the acquiree obtained by the Company through business combination shall beseparately recognized as liabilities and measured at fair value when their fair values can be reliably measured.v. When the Company allocates the cost of business combination and recognizes the identifiable assets andliabilities acquired through combination, it shall not include any goodwill and deferred income taxes that havebeen recognized by the acquiree before the business combination.
d) Treatment of the difference between the business combination costs and the fair value of netidentifiable asset acquired from the acquiree through combination
i. The Company shall recognize the difference of the combination costs in excess of the fair value of the netidentifiable asset acquired from the acquiree through combination as goodwill.
ii. The Company shall recognize the difference of the combination costs in short of the fair value of the net
identifiable asset acquired from the acquiree through combination according to the following provisions:
Review the measurement of fair values of all the identifiable assets, liabilities and contingent liabilitiesacquired from the acquiree and the combination costs;After the review, if the combination costs are still in short of the fair value of the net identifiable assetacquired from the acquiree through combination, include the difference in the current profit and loss.
(3) Treatment of relevant expenses arising from the Company’s business combination
a) Relevant expenses directly arising from the business combination of the Company (including theexpenses for audit, legal services, evaluation and consultation or other intermediary costs for businesscombination) shall be included in the current profit and loss when they are incurred.
b) Commissions, fees and other expenses paid on issuance of bonds and undertaking of other debts for thebusiness combination shall be included in the initial measurement amount of debt securities.
i. Where the bonds are issued at discount or par value, that part of expenses will increase the amount ofthe discount;
ii. Where the bonds are issued at premium, that part of expenses will decrease the amount of thepremium.
c) Fees, commissions, and other transaction expenses paid on issuance of equity securities as combinationconsideration in the business combination shall be included in the initial measurement amount of equitysecurities.
i. Where the equity securities are issued at premium, that part of expenses shall be deducted from capitalreserves (stock premium);
ii. Where the equity securities are issued at par value or discount, that part of expenses shall be deductedfrom the retained earnings.
6. Preparation of consolidated financial statements
(1) Consistency of accounting policies and accounting period
All the subsidiaries within the consolidation scope of consolidated financial statements shall adopt thesame accounting policies and accounting periods as those of the Company. If the accounting policies oraccounting periods of a subsidiary are different from those of the Company, the financial statements of thesubsidiary, upon preparation of consolidated financial statements, shall be adjusted according to theaccounting policies and accounting periods of the Company.
(2) Preparation method of consolidated financial statements
The consolidated financial statements are based on the financial statements of the Company and itssubsidiaries, and are prepared by the parent company according to other relevant information after theadjustment to long-term equity investments in subsidiaries under the equity method and the elimination ofeffects of the internal transactions between the Company and its subsidiaries and between the subsidiaries onthe consolidated financial statement.
(3) Reflection of excess losses incurred to a subsidiary in the consolidated financial statements
In the consolidated financial statements, where the current losses undertaken by the parent company arein excess of its share of owners’ equity in the subsidiary at the beginning of the period, the balance shallreduce the owners’ equity (retained earnings) of the parent company; where the current losses undertaken bya subsidiary’s non- controlling shareholders excess those non-controlling shareholders’ share of owners’ equityin the subsidiary at the beginning of the period, the balance shall reduce the non- controlling interests.
(4) Changes in number of subsidiaries during the reporting period
a) Acquisition of subsidiaries during the reporting period
i. Treatment of acquiring subsidiaries from business combination under common control during the
reporting period
During the reporting period, if the Company acquires subsidiaries from the business combination undercommon control, the opening balance in the consolidated balance sheet shall be adjusted. The income,expenses and profits of the newly acquired subsidiaries from the beginning to the end of the reporting periodshall be included in the consolidated income statement. The cash flows of the newly acquired subsidiariesfrom the beginning to the end of the reporting period shall be included in the consolidated statement of cashflows.ii. Treatment of acquiring subsidiaries from business combination not under common control during thereporting period
During the reporting period, if the Company acquires subsidiaries from the business combination not undercommon control, the opening balance in the consolidated balance sheet shall not be adjusted. The income,expenses and profits of the newly acquired subsidiaries from the acquisition date to the end of the reportingperiod shall be included in the consolidated income statement. The cash flows of the newly acquiredsubsidiaries from the acquisition date to the end of the reporting period shall be included in the consolidatedstatement of cash flows.
b) Treatment of disposing subsidiaries during the reporting period
During the reporting period, if the Company disposes subsidiaries, the opening balance in the consolidatedbalance sheet shall not be adjusted. The income, expenses and profits of the newly disposed sub diaries fromthe beginning to the disposal date shall be included in the consolidated income statement. The cash flowsfrom the beginning to the disposal date shall be included in the consolidated statement of cash flows.
7. Classification of joint venture arrangements and the accounting treatment method of commonoperation
(1) Classification of joint venture arrangements
A joint arrangement is classified as either a joint operation or a joint venture. A joint operation is a jointarrangement whereby the joint operators have rights to the assets, and obligations for the liabilities, relating tothe arrangement. A joint venture is a joint arrangement whereby the joint ventures only have the rights to thenet assets under this arrangement.
A joint arrangement that is not structured through a separate vehicle shall be classified as a joint operation.A separate vehicle refers to a separately identifiable financial structure, including separate legal entities orentities without a legal personality but recognized by statute.
A joint arrangement that is structured through a separate vehicle is usually classified as a joint venture.However, when a joint arrangement provides clear evidence that it meets any of the following requirementsand complies with applicable laws and regulations as a joint operation:
a) The legal form of the joint arrangement indicates that the parties that have joint control have rights tothe assets, and obligations for the liabilities, relating to the arrangement.
b) The terms of the joint arrangement specify that the parties that have joint control have the rights to theassets, and the obligations for the liabilities, relating to the arrangement.
c) Other facts and circumstances indicate that the parties that have joint control have rights to the assets,and the obligations for the liabilities, relating to the arrangement---for example, the parties that have jointcontrol have rights to substantially all of the output of the arrangement, and the arrangement depends on theparties that have joint control on a continuous basis for settling the liabilities of the arrangement.
(2) Accounting treatment of a joint operation
A joint operator shall recognize the following items in relation to its interest in a joint operation, andaccount for them in accordance with relevant accounting standards:
a) Its solely-held assets, and its share of any assets held jointly;b) Its solely-assumed liabilities, and its share of any liabilities incurred jointly;c) Its revenue from the sale of its share of the output arising from the joint operation;d) Its share of the revenue from sale of the output by the joint operation; ande) Its solely-incurred expenses and its share of any expenses incurred jointly.
8. Cash and cash equivalents
Cash comprises cash on hand and deposits that can be readily withdrawn on demand.Cash equivalents are the company’s short-term (due within 3 months from purchase date), highly liquidinvestments that are readily convertible to known amounts of cash and which are subject to an insignificantrisk of changes in value.
9. Foreign currency transactions and translation of foreign currency statements
(1) Accounting method of foreign currency transactions
a) Initial recognition of foreign currency transactionsFor foreign currency transactions incurred, the Company converts the amount in foreign currency into theamount in functional currency at the spot exchange rate (middle rate) announced by the People’s Bank ofChina on the transaction date. Among them, for foreign currency exchange occurred or transaction involvingforeign currency exchange, the Company converts at the exchange rate actually adopted on the transactiondate.
b) Adjustment or settlement on the balance sheet date or settlement dateOn the balance sheet date or the settlement date, the Company handles foreign currency monetary itemsand foreign currency non-monetary items separately in accordance with the following methods:
i. Accounting principles for handling foreign currency monetary itemsFor foreign currency monetary items, on the balance sheet date or the settlement date, the Companyconverts them by using the spot exchange rate (middle rate) prevailing on the balance sheet date orsettlement date, and adjusts the amount in functional currency of foreign currency monetary items in respectof the difference arising from exchange rate fluctuations, which shall be treated as exchange difference at thesame time. Among them, the exchange differences arising from foreign currency loans relating to theacquisition, construction or production of assets eligible for capitalization shall be included in the costs ofassets eligible for capitalization; other exchange differences shall be included in the current financial expenses.
ii. Accounting principles for handling foreign currency non-monetary itemsFor foreign currency non-monetary items measured at historical cost, the Company shall convert them atthe spot exchange rate (middle rate) prevailing on the transaction date, with their amounts in functionalcurrency remaining unchanged and no exchange differences incurred.
For an inventory that is measured at the lower of its costs or its net realizable values, if the net realizablevalue is determined in foreign currency, the Company, when determining the value of the inventory at the endof the period, shall firstly convert the net realizable value into functional currency and then compare it withthe inventory cost reflected in functional currency.Non-monetary items measured at fair value that is reflected in foreign currency at the end of the period,the Company shall firstly translate the foreign currency into the amount in functional currency at the spotexchange rate on the date when the fair value is determined, and then compare it with the original functionalcurrency amount. Difference between the translated functional currency amount and the original functionalcurrency amount is treated as profit or loss from changes in fair value (including changes in exchange rate) andis recognized in current profit and loss.
(2) Accounting treatment method for translation of foreign currency statements
a) The Company shall translate the financial statements of foreign operations in accordance with thefollowing methods:
i. Assets and liabilities in the balance sheets shall be translated at the spot exchange rates on balance sheetdate. Shareholders’ equity items, except for the item of "undistributed profits", are translated at the spotexchange rates on the dates when the transactions occur.
ii. Revenue and expense items in the income statement are translated at the spot exchange rates on thedates when the transactions occur or at the exchange rate determined in a systematical and reasonablemethod and similar to the spot exchange rate on the day when the transactions occur.
Differences arising from the above translations of foreign currency financial statements are separatelylisted under ‘other comprehensive income’ in the consolidated balance sheet.
The translation of comparative financial statements is handled by reference to the above approach.
b) The Company shall translate the financial statements of foreign operations that are in virulent inflationeconomy in accordance with the following methods:
i. The Company restates the items in the balance sheet by using the general price index, and restates theitems in the income statement by using the changes in general price index, and then converts those items atthe spot exchange rate on the latest balance sheet date.
ii. Where the foreign operations are no longer in virulent inflation economy, the Company ceases to restatethe financial statements and converts the financial statements restated according to the price level on suchcease.
c) Where the Company disposes of an overseas business, it shall transfer the foreign currency financialstatements exchange difference, which relates to the business disposed of and is presented under the items ofthe other comprehensive income in the balance sheet, from the other comprehensive income item to the gainor loss on disposal for the current period. If the overseas business is partly disposed of, the foreign currencyfinancial statements exchange difference shall be calculated in proportion to the percentage of disposal andtransferred to gain or loss on disposal for the current period.
10. Financial Instruments
Financial instruments are the financial asset, financial liability or (equity) instrument will be recognisedwhen the Company became one of the parties under a contract.
(1) Classification of financial instruments
a) Classification of financial assets
According to the company's business model of managing financial assets and the characteristics of contractcash flow of financial assets, financial assets are classified into the following three categories: financial assetsmeasured at amortized cost; financial assets measured at fair value through other comprehensive income(including financial assets directly designated to be measured at fair value through other comprehensiveincome); and financial assets measured at fair value through the current profit or loss.
b) Classification of financial liabilities
The Company classifies the financial liabilities into the following two categories: financial liabilitiesmeasured at fair value through current profit and loss (including financial liabilities held for trading andfinancial liabilities directly designated to be at fair value through current profit and loss); and financial liabilitiesmeasured at amortized cost.
(2) Recognition basis and measurement method of financial instruments
a) Recognition basis of financial instruments
When the Company becomes a party to a financial instrument, it shall recognize a financial asset orfinancial liability.
b) Measurement method of financial instrumentsi. Financial assetsFinancial assets are measured at fair value upon initial recognition. For financial assets at fair value throughprofit or loss, relevant transaction costs are directly recognized in profit or loss for the period. For othercategories of financial assets, relevant transaction costs are included in the amount initially recognized.Accounts receivable or notes receivable arising from sales of goods or rendering services and withoutsignificant financing component or the company decided not to consider financing elements for less than oneyear are initially recognized based on the amount of consideration expected to be entitled to receive accordingto Accounting Standard for Business Enterprises No. 14 - Revenue.
①Financial assets measured at amortized cost
These assets are subsequently measured at amortized cost using the effective interest method after initialrecognition. Gains/losses on financial assets that are measured at amortized cost and are not a part of anyhedging relationship shall be recognized in profit or loss when the financial asset is derecognised orreclassification or amortized using the effective interest method or recognized the impairment allowance.
②Financial assets measured at fair value through other comprehensive income
These assets are subsequently measured at fair value after initial recognition. Except impairment, foreignexchange gains and losses, interest income calculated using the effective interest method are recognized inprofit or loss; other gains and losses are recognized in other comprehensive income. On derecognition, gainsand losses accumulated in other comprehensive income are transferred to profit or loss.
In addition, the company designated some non-tradable equity instruments as financial assets measured atfair value through other comprehensive income; the company shall recognize the relevant dividend income ofsuch financial assets into the current profit and loss, and recognize the change of fair value in othercomprehensive income. On derecognition, the accumulated gains/losses previously recognized in othercomprehensive income shall be transferred to retained earnings and not be recognized in current profit andloss.
③ Financial assets measured at fair value through profit or loss
The Company classifies the financial assets, except for financial assets measured at amortized cost or at fairvalue through other comprehensive income as mentioned above, into the financial assets measured at fairvalue through profit or loss for the current period. In addition, the company may designate some financialassets as financial assets measured at fair value through profit or loss for the current period upon the initialrecognition to eliminate or significantly reduce accounting mismatch. For such financial assets, the companyadopts the fair value for subsequent measurement, and changes in fair value are recognized in the profit orloss for the current period.
ii. Financial liabilities
Financial liabilities shall be classified into financial liabilities measured at fair value through profit or loss forthe current period upon initial recognition and other financial liabilities. For financial liabilities measured at fairvalue through profit or loss, relevant transaction costs are directly recognized in the current profit and loss,and the relevant transaction costs of other financial liabilities are recognized in the initial recognition amount.
①Financial liabilities measured at fair value through profit or loss
Financial liabilities held for trading (including derivatives of financial liabilities) shall be subsequentlymeasured at the fair value. Except for those related to hedge accounting, changes in the fair value shall berecognized in the profit or loss of the current period. For financial liabilities designated to be at fair valuethrough profit or loss, fair value changes caused by the Company's own credit risk changes which is recognizedin other comprehensive income, when the liability is derecognition, the accumulated change in its fair value
caused by the change in its own credit risk recognized in other comprehensive income is transferred toretained earnings, the remaining changes of fair value is record in profit of loss. If the above treatment of theimpact of the change in the credit risk of such financial liabilities will cause or expand the accounting mismatchin the profit and loss, the company will record all the gains/losses of such financial liabilities (including theamount affected by fair value changes in enterprise's own credit risk) into the current profit and loss.
② Financial liabilities measured at amortized cost
Except financial liabilities that arise when a transfer of a financial assets does not qualify for derecognitionor when the continuing involvement approach applies security contract are classified as financial liabilitiesmeasured by amortized cost, or financial subsequently measurement at amortized cost, and record the profitsor losses guarantee contracts recognition or amortization into the current profit and loss.
(3) Financial assets transfer
If the Company transfers substantially all the risks and rewards of ownership of the financial asset to thetransferee, the Company derecognizes the financial asset, the rights and obligations arising or retained in thetransfer shall be separately recognized as its assets or liabilities; if the Company retains substantially all therisks and rewards of ownership of the financial asset, it continues to recognize the transferred financial assets.If the Company neither transfers nor retains substantially all the risks and rewards of ownership of the financialasset, it is accounted for as follows: if the Company has not retained control, it derecognizes the financial asset,the rights and obligations arising or retained in the transfer shall be separately recognized as its assets orliabilities; and if the Company has retained control, it continues to recognize the financial asset to the extent ofits continuing involvement in the transferred financial asset and recognizes the relevant liability.
Where transfer of financial assets qualify for derecognition entirety, the difference between the followingtwo amounts will be included into current profit or loss: The book value measured at the date of derecognition;and The sum of the consideration for the derecognition part and the portion of derecognition correspondingto the accumulated amount of the changes in fair value originally and directly included in OCI (involving thesituation where the financial asset transferred is a debt instrument investment measured at fair value andrecognized in other comprehensive income). The Company transferred the partial transfer of financial assetswhich qualify for derecognition, the overall carrying amount of the transferred financial asset shall beapportioned according to their respective relative fair value between the portion of derecognition and theremaining.
(4) Derecognition of financial liabilities
If the current obligation of the financial liability (or part thereof) has been discharged, the company shallremove financial liability (or part thereof), and the company shall recognize the difference between its bookvalue and the consideration paid (including any non-cash assets transferred or liabilities assumed) in thecurrent profit and loss.
(5) Offsetting of financial assets and liabilities
Financial assets and financial liabilities shall be shown separately in the balance sheet and shall not beoffset against each other. If the following conditions are met at the same time, the net value offset each otherafter amount listed in the balance sheet:
The company has offset the confirmed number of legal rights of financial assets and financial liabilities, andthis kind of legal rights is the executable; and
The company plans to net or cash at the same time when the financial assets and liquidation of thefinancial liability.
If the transfer of financial assets does not meet the conditions for derecognition, the transferor shall notoffset the transferred financial assets and related liabilities.
(6) Equity instruments
Equity instruments are contracts that prove ownership of the residual interest in the company’s assets afterdeducting all liabilities. The issuance (including refinancing), repurchase, sale or cancellation of the equityinstruments of the company shall be treated as changes in the equity. The company does not recognizechanges in the fair value of equity instruments, and the transaction fees related to the equity transactions shallbe deducted from the equity. Where the equity instrument of the company distributes dividends during theterm of its existence, it shall be treated as profit distribution, and the total amount of shareholders' equity willnot be affected by the stock dividends issued.
(7) Method for determining the fair value of financial assets and financial liabilities
Where there is an active market for a financial instrument, the company shall determine its fair value byquoting in the active market. Where there is no active market for the financial instrument, the company shalldetermine its fair value by means of valuation technology. In valuation, the company uses valuation techniquesapplicable in the current situation and supported by sufficient available data and other information to selectinput values consistent with the characteristics of assets or liabilities considered by market participants intransactions of related assets or liabilities, and gives priority to relevant observable input values as far aspossible. Use unobservable inputs only when relevant observable inputs cannot be obtained or areimpracticable to obtain.
Upon initial recognition, the fair value of financial assets or financial liabilities is determined by the quotedprice of the same assets or liabilities in the active market or other valuation technology that only usesobservable market data, the Company defers the difference between the fair value and the transaction price.After initial recognition, the Company recognizes the deferred difference as gain or loss in the correspondingaccounting period according to the changes of a certain factor in the corresponding accounting period.
(8) Impairment of Financial Assets
Based on the expected credit loss, the Company shall recognize the impairment loss on financial assetsmeasured at amortized cost, debt instrument investment at fair value through other comprehensive income.
a) The approach of recognition loss allowance for expected credit losses
Considering the reasonable and valid information such as past events, current conditions and forecast offuture economic conditions, and weighted by the risk of default, the Company calculates the probabilityweighted amount of the present value of the difference between the cash flow receivable under the contractand the expected cash flow to be received, and confirms the expected credit loss.
i. General approach
The Company assess whether the credit risk of financial instruments in different stages at each reportingdate has increased significantly. If the financial instruments' credit risk have not increased significantly afterinitial recognition, it will be included in phase 1, and the Company measures the loss allowance for thoseinstruments at an amount equal to 12-month expected credit losses; if the financial instruments' credit riskhave increased significantly but without objective evidence for impairment after initial recognition, it will beincluded in phase 2, and the Company measures the loss allowance of those instruments at an amount equalto lifetime expected credit losses; if the financial asset that is evidently credit-impaired after initial recognition,it will be included in phase 3, and the Company measures the loss allowance of those financial instruments atan amount equal to lifetime expected credit losses. For financial instruments with low credit risk on thebalance sheet data (e.g., fixed deposits in commercial banks with higher credit rating, financial instrumentswith external credit rating above "investment grade"), the Company assumes that the credit risk has notincreased significantly since the initial recognition and chooses to measure the loss provision according to theexpected credit loss in the next 12 months.
ii. Simplified approachFor accounts receivable, contract assets, lease receivables and Income-related notes receivable that do notcontain significant financing components or do not consider the financing components in the contracts for nomore than one year old, the company adopts simplified approach and shall always measure the loss allowanceat an amount equal to lifetime expected credit lossesFor accounts receivable, contract assets and lease receivables are defined by the Accounting Standards forBusiness Enterprises No. 21-Leasing that include significant financing components, the company recognizes aloss allowance equal to the lifetime expected credit losses.b) Criteria for determining whether credit risk has increased significantly subsequent to the initialrecognition
If the probability of default of a financial asset in lifetime as determined on the balance sheet date issignificantly higher than the probability of default in lifetime as determined at the initial recognition, the creditrisk of the financial asset increases significantly.
No matter what method the Company is applied to evaluate whether credit risk has increased significantly,it usually inferred that the credit risk of the financial instrument has increased significantly if the contractpayment delay exceeds 30 days, unless the Company can get the reasonable and valid information atreasonable cost to evidence that the credit risk of the financial instrument has not increased significantly sincethe initial recognition.
Except in special cases, the Company shall use the change of default risk in the next 12 months as areasonable estimate of the change of default risk in lifetime to determine whether the credit risk has increasedsignificantly to the initial recognition
c) Approach of assessing expected credit risk on a portfolio basis and determine basis
The company evaluates credit risk individually for the credit risk of significantly different notes receivables,accounts receivables, contract assets, lease receivables and other receivables with the following characteristics.Such as: accounts receivables in dispute with the other party or involving litigation or arbitration; notesreceivables, accounts receivables that have shown clear signs that the debtor is likely to be unable to meetrepayment obligations.
When it is impossible to evaluate the expected credit loss information of an individual financial asset at areasonable cost, the Company divides the receivables into several portfolio according to the credit riskcharacteristics, and calculates the expected credit loss on collective basis. The basis for determining theportfolio is as following:
Name | Approach of assessing expected credit risk |
Bank acceptance bill Portfolio; Commercial acceptance bill Portfolio | For notes receivables divided into portfolio, the bank acceptance bill and commercial acceptance bill refer to the historical credit loss experience, and combines the current situation and the forecast of future economic situation respectively. The Company calculates the expected credit loss based on the default risk exposure and the expected credit loss rate of the whole duration. |
Risk Portfolio | For accounts receivables divided into risk portfolio, the Company refers to the historical credit loss experience, and combines the current situation and the forecast of future economic situation, and prepares a comparison table between overdue ages of accounts receivables and expected credit loss rate of the whole duration to calculate the expected credit loss. |
Other Portfolio
Other Portfolio | The Company classifies items without significant recovery risk receivables as other portfolio such as items from subsidiaries in the consolidation scope, tax refunds receivable, collection and withholding of funds. There is no provision for bad debt for them. |
Lease receivables | For Lease receivables classified into combinations, the expected credit loss is calculated through the default risk exposure and the expected credit loss rate of the whole duration according to the historical credit loss experience, the current situation and the forecast of the future economic situation |
The Company shall take the provision or transfer the loss into the current profit and loss. For the debtinstrument investment measured at fair value through other comprehensive income, the Company shall adjustother comprehensive income while recording the impairment loss or gain into the current profit and loss.
11. Inventory
(1) Classification of inventory
Inventories are classified as: raw materials, semi-finished goods, stock commodities, consigned processingmaterials, goods in progress and revolving materials (including low-cost consumables), etc.
Measurement method of dispatched inventories
Dispatched materials and stock commodities are accounted for by using the weighted average method.
(2) Basis to determine net realizable values of inventories and method of provision for
stock obsolescence
a) Determination basis of net realizable values of inventories
i. In normal operation process, for merchandise inventories held directly for sale, including stockcommodities (finished goods) and materials for sale, their net realizable values are determined at theirestimated selling prices minus their estimated selling expenses and relevant taxes and surcharges.
ii. In normal operation process, for material inventories that need further processing, their net realizablevalues are determined at the estimated selling prices of finished goods minus estimated costs to completion,estimated selling expenses and relevant taxes and surcharges.
iii. For inventories held to execute sales contract or service contract, their net realizable values arecalculated on the basis of contract price. If the quantities of inventories specified in the sales contracts are lessthan the quantities held by the Company, the net realizable value of the excess portion of inventories shall bebased on general selling prices.
iv. The materials held for production shall be measured at cost if the net realizable value of the finishedproducts is higher than the cost. If a decline in the value of materials shows that the net realizable value of thefinished products is lower than the cost, the materials shall be measured at the net realizable value.
b) Provision for stock obsolescence
i. Provisions for stock obsolescence are made at the lower of costs or net realizable values on a single basis.
ii. For inventories with large quantity and relatively low unit prices, the provision for stock obsolescenceshall be made on the ground of the categories of inventories.
(3) Inventory system
The Company adopts perpetual inventory system and takes physical inventory counts on a regular basis.
(4) Amortization method of revolving materials
a) Amortization method of low-cost consumables:
Low-cost consumables are amortized in full at once.b) Amortization method of packaging materialsPacking materials are amortized in full at once when fetched for use by the Company.
12. Contract assets
A contract asset is a company's right to receive consideration for goods transferred to a customer, and thisright depends on factors other than the passage of time. The company's contract assets mainly includecompleted and unsettled assets and quality guarantee deposit. The contract assets and contract liabilitiesunder the same contract shall be shown on a net basis, and the contract assets and contract liabilities underdifferent contracts shall not be set off.
For the determination method and accounting treatment method of expected credit loss of contract assets,refer to "Impairment of Financial Assets" in Note 10 (8).
13. Contract costs
Assets related to contract costs include contract acquisition costs and contract performance costs.
The cost of contract fulfillment incurred by the company to perform the contract shall be recognized as anasset if the following conditions are met:
(1) The cost is directly related to a current or anticipated contract.
(2) The cost increases the company's resources for future performance obligations.
(3) The cost is expected to be recovered.
The incremental cost incurred by the company in obtaining the contract is expected to be recovered shallbe recognized as an asset as the cost of obtaining the contract.
The Company amortizes the asset related to the contract cost on the same basis as the recognition of therevenue of the goods or services related to the asset, and includes it in the profit or cost for the current period.
If the book value of the assets related to the contract cost is higher than the difference between thefollowing two items, the Company will make an impairment provision for the excess part and confirm it as theimpairment loss of the assets:
(1) The transfer of the goods or services related to the asset less the estimated cost;
(2) Estimated impending costs for the transfer of the related goods or services.
If the impairment provision of the above asset is subsequently reversed, the book value of the asset afterreversal shall not exceed the carrying amount the asset would have reached on the date of reversal had theprovision for impairment been not made.
14. Assets held for sale
Assets held for sale
a) Scope of a non-current asset held for sale and a disposal group
A non-current asset or disposal group is classified as held for sale when a company recovers its carryingvalue primarily through the sale (including the exchange of non-monetary assets of a commercial nature)rather than through the continuous use of such a group.
A disposal group is a group of assets that are disposed as a whole through sales or other ways in onetransaction and liabilities directly related to these assets delivered in the transaction.
b) Recognition criteria of a non-current asset held for sale and a disposal group
The Company recognizes its component (or non-current asset) that satisfies the following conditions as
assets held for sale:
i. The assets or disposal group must be available for immediate sale in its present condition subject only toterms that are usual and customary for sales of such assets or disposal groups;
ii. Its sale must be highly probable. The Company has already made a decision to dispose the componentand has a commitment from the purchaser, the transfer will be completed within one year. If it requiresshareholders’ approval or supervisors’ approval according to regulations, it has already received approval fromthe general meeting of stockholders or relative authority institution.
c) Accounting treatment and presentation of a non-current asset held for sale and a disposal group
The non-current asset or disposal group is first classified as held for sale, the Company should measure thenon-current assets or assets and liabilities made up of disposal group in accordance with relevant accountingstandards.
When the Company measure a non-current asset or disposal group held for sale initially or re-measure atbalance sheet date subsequently, the impairment loss should be recognized if the book value is higher than fairvalueless costs to sell at the amount of the difference of these two in profit and loss, the provision for assetsheld for sale need to be recognized at the same time. For the impairment of disposal group, should write offgoodwill if existing, and then write down the related assets proportionally. Depreciation or amortization shouldcease for the non-current asset held for sale.
No matter the asset is classified as individual asset held for sale or asset belonging to disposal group, theasset is presented as current assets under “assets held for sale” item; liabilities related to the asset transferredin the disposal group held for sale is presented as current liabilities under “liabilities held for sale” item in thebalance sheet.
The Company is committed to a sale plan involving loss of control of subsidiary shall classify all the assetsand liabilities of that subsidiary held for sale in consolidated balance sheets when the above criteria are met,regardless of whether the Company retain a non–controlling interests in its former subsidiary after the sale. Inthe balance sheets of parent company, the investment should be classified as held for sale in full. In theconsolidated financial statements, all assets and liabilities of the subsidiaries are classified as held for sale.
Termination of business operations
Termination means any separate part which satisfies one of the following conditions and which has beendisposed of or classified as being held for sale:
a) The component represents a separate principal business or a separate principal area of operation;
b) The component is part of an associated plan to dispose of a separate principal business or a separateprincipal operating area;
c) The component is a subsidiary acquired specifically for resale.
15. Long-term equity investment
(1) Recognition of the initial investment costs of long-term equity investments
a) For long-term equity investments from business combinations, the initial investment cost shall berecognized in accordance with the provisions mentioned in Notes 3(5). Accounting Method for Long-termEquity Investment from Business Combinations under Common Control and Business Combination not underCommon Control.
b) Except for the long-term equity investments arising from business combinations, those obtained byother means shall recognize their initial investment costs in accordance with the following provisions:
i. For the long-term equity investments obtained by cash paid, the Company recognizes the actual purchase
price as the initial investment costs. The initial investment costs include directly related expense, taxes andother necessary expenses of obtaining long-term equity investments.ii. For the long-term equity investments acquired by the issue of equity securities (equity instrument), theinitial investment cost shall be the fair value of the equity securities (equity instrument) issued. If the fair valueof the long-term equity investment obtained is more reliable than equity securities issued, the initialinvestment cost shall be the fair value of the long-term equity investment made by the investors. The costdirectly attributable to the issue of equity securities (equity instrument), including fees, commissions, etc.,write-downs premium price of the issue, if premium price of the issue is insufficient, write- downs surplusreserve and undistributed profit in turn. For the long-term equity investments acquired by the issue of debtsecurities (debt instrument) , reference through the issuance of equity securities (equity instrument).
iii. For long-term equity investments obtained by debt restructuring, the Company recognizes the fair valueof shares of debt-for-equity swap as the initial investment costs.
iv. For long-term equity investments obtained by non-monetary assets exchange, under the condition thatan exchange of non-monetary assets is of commerce nature and the fair value of assets exchanged can bereliably measured, non- monetary assets traded in is initially stated at the fair value of the assets traded out,unless there is conclusive evidence indicating that the fair value of the assets traded in is more reliable; if theabove conditions are not satisfied, initial investment costs of long-term equity investments traded in shall berecognized at the book value of the assets traded out and the relevant taxes and surcharges payable.
Expenses, taxes and other necessary expenses incurred to the Company and that are directly related to theobtainment of long-term equity investments shall be recognized as the initial investment costs of long-termequity investments.
For long-term equity investments obtained by the Company by any means, cash dividends or profitsdeclared but not yet distributed in the actual payments or the consideration actually paid for the investmentshall be separately accounted as dividends receivable and shall not constitute the costs of long- term equityinvestments.
(2) Subsequent measurement and recognition of gains and losses of long-term equity investments
a) Long-term equity investment measured under cost method
i. If accompany can control an investee, namely investment in subsidiary, the long-term equity investmentshall be measured under the cost method.
ii. For long-term equity investments accounted at the cost method, except cash dividends or profitsdeclared but not yet distributed which are included in the actual payments or the consideration actually paidfor the investment, the cash dividends or profits declared by the investee shall be recognized as the investmentincome irrespective of net profits realized by the investee before investment or after investment.
b) Long-term equity investments measured under the equity method
i. For the long-term equity investment which has joint control or significant influence over the investee, theequity method is adopted for accounting.
ii. For long-term equity investments measured at the equity method, if the initial investment costs arehigher than the investor’s attributable share of the fair value of the investee’s identifiable net assets, noadjustment will be made to the initial costs of the long-term equity investments; if the initial investment costsare lower than the investor’s attributable share of the fair value of the investee’s identifiable net assets, thedifference shall be recognized in current profit and loss and at the same time the adjustment will be made tothe initial costs of the long-term equity investments.
iii. After obtaining the long-term equity investments, the Company shall, according to the shares of net
profits and other comprehensive income realized by the investee that shall be enjoyed or borne by theCompany, recognize the profit and loss on the investments and adjust the book value of the long-term equityinvestments. When recognizing the net profits and losses and other comprehensive income of the investeethat the Company shall enjoy or bear, the Company shall make a recognition and calculation based on the netbook profits and losses of the investee after appropriate adjustments. However, where the Company is unableto obtain the relevant information due to failure to reasonably determine the fair value of the investee’sidentifiable assets, minor difference between the investee’s identifiable assets and the book value thereof orother reasons, the profits or losses on the investments shall be directly calculated and recognized based on thenet book profits and losses of the investee. The Company shall calculate the part distributed from cashdividends or profits declared by the investee and correspondingly reduce the book value of the long-termequity investments.
When recognizing the income from investments in associates and joint ventures, the Company shall writeoff the part of incomes from internal unrealized transactions between the Company and associates and jointventures which are attributable to the Company and recognize the profit and loss on investments on such basis.Where the losses on internal transactions between the Company and the investee fall into the scope of losseson assets impairment, full amounts of such losses shall be recognized. Profit and loss from internal unrealizedtransactions between the Company’s subsidiaries included into the combination scope and associates and jointventures shall be written off according to the above principles and the profit and loss on investmentsthereafter shall be recognized on such basis.When the share of net loss of the investee attributable to the Company is recognized, it is treated in thefollowing sequence: Firstly, write off the book value of the long-term equity investments; where the bookvalue of the long- term equity investments is insufficient to cover the loss, investment losses are recognized tothe extent that book value of long-term equity which form net investment in the investee in other substancesand the book value of long-term receivables shall be written off; after all the above treatments, if the Companystill assumes additional obligation according to investment contracts or agreements, the obligation expected tobe assumed should be recognized as provision and included into the investment loss in the current period. Ifthe investee is profitable in subsequent accounting periods, the Company shall treat the loss in reverse orderagainst that described above after deducting unrecognized share of loss: i.e. write down the book value of therecognized provision, then restore the book value of long-term interests which substantially form netinvestments in the investee, then restore the book value of long-term investments, and recognize investmentincome at the same time.
(3) Basis for judgment of common control or significant influence over the investee
a) Basis for judgment of common control over investee
Common control is the contractually agreed sharing of control of an arrangement, which exists only whendecisions about the relevant activities require the unanimous consent of the parties sharing control. Relevantactivities of an arrangement usually include selling and purchasing of goods or services, managing financialassets, acquiring or disposing of assets, researching and developing activities and financing activities. A jointventure is a joint arrangement whereby the joint ventures have rights to the net assets of the arrangement.The parties have rights to the assets, and obligations for the liabilities, relating to the arrangement, which is ajoint operation, but not a joint venture.
b) Basis for judgment of significant influence over investee
The term “significant influence” refers to the power to participate in decision-making on the financial andoperating policies of the investee, but with no control or joint control over the formulation of these policies.
Where the Company is able to exert significant influence over the investee, the investee is its associate.
16. Fixed assets
(1) Recognition of fixed assets
Fixed assets refer to tangible assets held for the purpose of producing commodities, providing services,renting or business management with useful life exceeding one accounting year. Fixed assets are recognizedwhen the following criteria are satisfied simultaneously:
a) It is probable that the economic benefits relating to the fixed assets will flow into the Company;
b) The cost of the fixed assets can be measured reliably.
(2) Depreciation of fixed assets
Category | Depreciation method | Estimated useful life (Yr) | Estimated residual value rate (%) | Annual depreciation rate (%) |
Buildings And constructions | Straight-line method | 20 ~25 | 5 | 3.80 ~4.75 |
Machinery equipments | Straight-line method | 10 | 5 | 9.50 |
Transportation equipments | Straight-line method | 10 | 5 | 9.50 |
Other equipments | Straight-line method | 8 | 5 | 11.88 |
17. Construction in progress
(1) Categories of constructions in progress
Constructions in progress are accounted on individual project basis.
(2) Criteria and commencement of conversion of constructions in progress into fixed assets
The book entry values of the fixed assets are stated at total expenditures incurred before construction inprogress reaches the working condition for their intended use. For self- operating projects, total expendituresare measured according to the expenditures of direct materials, direct labor, direct measurement mechanicalconstruction costs and other expenditures; for contracting projects, total expenditures are measured accordingto project costs payable and other expenditures. Borrowing costs incurred before the projects that areundertaking with borrowing costs reach working condition for their intended use and meeting the conditionfor capitalization shall be capitalized and included into the costs of construction in progress.
For construction in progress that has reached working condition for intended use but for which thecompletion of settlement has not been handled, it shall be transferred into fixed assets at the estimated valueaccording to the project budget, construction price or actual cost, etc. from the date when it reaches theworking condition for intended use and the fixed assets shall be depreciated in accordance with the Company’spolicy on fixed asset depreciation; adjustment shall be made to the estimated value based on the actual costafter the completion of settlement is handled, but depreciation already provided will not be adjusted.
18. Borrowing costs
(1) Scope of borrowing costs
The Company’s borrowing costs include interest thereon, amortization of discounts or premiums, ancillaryexpenses and exchange differences incurred from foreign currency loan, etc.
(2) Recognition principles of capitalization of borrowing costs
The borrowing costs incurred to the Company and directly attributable to the acquisition and constructionor production of assets eligible for capitalization should be capitalized and recorded into relevant asset costs;other borrowing costs should be recognized as costs according to the amount incurred and be included intothe current profit and loss.
Assets eligible for capitalization include fixed assets, investment properties, inventories and other assetswhich may reach the working condition for their intended use or sale by acquisition and construction orproduction activities for quite long time.
(3) Recognition of capitalization period of borrowing costs
a) Recognition of commencement of capitalization of borrowing costs
Borrowing costs may be capitalized when asset disbursements have already been incurred, borrowing costshave already been incurred and the acquisition and construction or production activities which are necessaryto prepare the assets for their intended use or sale have already been started. Among which, assetdisbursements include those incurred by cash payment, the transfer of non-cash assets or the undertaking ofinterest-bearing debts for acquiring and constructing or producing assets eligible for capitalization.
b) Recognition of period of capitalization suspension of borrowing costs
If the acquisition and construction or production activities of assets eligible for capitalization areinterrupted abnormally and this condition lasts for more than three months, the capitalization of borrowingcosts should be suspended. The borrowing costs incurred during interruption are charged to profit or loss forthe current period, and the capitalization of borrowing costs continues when the acquisition and constructionor production activities of the asset resume. If the interruption is necessary for the acquisition andconstruction or production to prepare the assets for their intended use or sale, the capitalization of borrowingcosts should continue.
c) Recognition of period of capitalization cessation of borrowing costs
Capitalization of borrowing costs should cease when the acquired and constructed or produced assetseligible for capitalization have reached the working condition for their intended use or sale. Borrowing costsincurred after the assets eligible for capitalization have reached the working condition for their intended use orsale should be recognized as the current profit and loss when they incur.
If all parts of the acquired and constructed or produced assets are completed, each part may be used orsold externally in the process of continuous construction of other parts and the necessary acquisition orproduction activities have been substantially completed to make the part of assets reach the working conditionfor their intended use or sale, the capitalization of borrowing costs related to the part of assets should beceased; if all parts of the acquired and constructed or produced assets are completed but the assets cannot beused or sold externally until overall completion, the capitalization of borrowing costs should cease at the timeof overall completion of the said assets.
(4) Recognition of capitalized amounts of borrowing costs
a) Recognition of capitalized amounts of interest on borrowing costs
During the period of capitalization, capitalized amount of the interest of each accounting period (includingamortization of discounts or premiums) shall be recognized according to the following provisions:
i. As for special loan borrowed for acquiring and constructing or producing assets eligible for capitalization,borrowing costs of special loan actually incurred in the current period less the interest income of the loansunused and deposited in bank or return on temporary investment should be recognized as the capitalization
amount of borrowing costs.ii.As for general loans used for acquiring and constructing or producing assets eligible for capitalization, theinterest of general loans to be capitalized should be calculated by multiplying the weighted average of assetdisbursements of the part of accumulated asset disbursements in excess of special loans by the capitalizationrate of used general loans. The capitalization rate is calculated by weighted average interest rate of generalloans.
iii. Where there are discounts or premiums on loans, the amounts of interest for each accounting periodshould be adjusted taking account of amortizable discount or premium amounts for the period by effectiveinterest method.
iv. During the period of capitalization, the capitalized amount of interest of each accounting period shall notexceed the current actual interest of the relevant loans.
b) Recognition of capitalized amounts of auxiliary expenses of loans
i.Auxiliary expenses incurred from special loans before the acquired or constructed assets eligible forcapitalization reach the working condition for their intended use or sale should be capitalized when they incurand charged to the costs of assets eligible for capitalization; those incurred after the acquired or constructedassets eligible for capitalization reach the working condition for their intended use or sale should berecognized as costs according to the amounts incurred when they incur and charged to the current profit orloss.
ii. Auxiliary expenses incurred from general loans shall be recognized as costs according to the amountsincurred when they occur and included in the current profit and loss.
c) Recognition of capitalized amount of exchange differences
During the period of capitalization, exchange differences incurred from the principal and interest of specialforeign currency loans should be capitalized and included in the costs of the assets eligible for capitalization.
19.Right-of-use assets
An asset that represents a lessee’s right to use an underlying asset for the lease term.
At the commencement date of the lease term, the company recognizes the right-of-use assets and leaseliabilities of all leases except for short-term leases and leases of low-value assets, and confirm the depreciationand interest expenses respectively during the lease term.The Company charges the lease payment of theshort-term lease and the low-value asset lease as the current loss and profit or the relevant asset costs on astraight-line basis over each period during the lease term.
(1) Initial measurement
At the commencement date, a lessee shall measure the right-of-use asset at cost. The cost of theright-of-use asset shall comprise:
① the amount of the initial measurement of the lease liability,
② any lease payments made at or before the commencement date, less any lease incentives received,which is the incremental cost for the lease
③ any initial direct costs incurred by the lessee;
④ an estimate of costs to be incurred by the lessee in dismantling and removing the underlying asset,restoring the site on which it is located or restoring the underlying asset to the condition required by the termsand conditions of the lease, unless those costs are incurred to produce inventories
(2) Subsequent measurement
a) Measurement basis
After the commencement date, a lessee shall measure the right-of-use asset applying a cost model. To
apply a cost model, a lessee shall measure the right? of? use asset at cost less any accumulated depreciationand any accumulated impairment losses; and adjusted for any remeasurement of the lease liability specified inthe lease term.b) Depreciation of the right-of-use assetsSince the commencement date, the Company shall depreciate the right-of-use asset. Depreciation shall bemade in the month of lease commencement and shall be accounted in the cost of related asset or profit andloss. When determining the depreciation method, straight line method is used for depreciation based on theexpected way of consuming of economic benefit related to the right-of-use asset. The Company shalldepreciate the right-of-use asset subsequently based on the book value after impairment loss deduction ifimpairment is applicable.
20. Intangible assets
(1) Measurement, useful life and impairment test
a) Initial measurement of intangible assetsi. Initial measurement of outsourcing intangible assetsCosts of outsourcing intangible assets shall be recognized according to the purchase price, related taxesand other expenses directly attributed to reaching the working condition for their intended use. The cost ofintangible assets shall be recognized based on present value of purchase price when deferred payment overnormal credit conditions with financial nature. The difference between actual payment and purchase price,expect for capitalized amount, shall be included into the current profit and loss in the period of credit.ii. Initial measurement of internally researched and developed intangible assetsCosts of internally researched and developed intangible assets shall be recognized according to the totalexpenses during the period after the assets are eligible for capitalization and before they reach the intendedpurpose and the expenses that have been included in the previous periods shall no longer be adjusted.
Expenses on the research phase of internally researched and developed intangible assets shall be includedin the current profit and loss when they incur; those on the development phase ineligible for capitalizationshall be included in the current profit and loss; those eligible for capitalization shall be recognized as intangibleassets. If it is unable to distinguish expenditure on the research phase and expenditure on development phase,the research and development expenditures shall be all included in the current profit and loss.b) Subsequent measurement of intangible assetsThe useful lives of intangible assets are analyzed on acquisition. Intangible assets obtained by the Companyare divided into intangible assets with limited useful lives and intangible assets with indefinite useful lives.
i. Subsequent measurement of intangible assets with limited useful lives
The intangible assets with limited useful lives are amortized on a straight-line basis when they reachintended use over their useful lives with no residual value reserved. Amortizations of intangible assets areusually recorded into the current profit and loss; where the economic benefits of an intangible asset arerealized by the products or other assets produced thereafter, the amortizations are recorded into the costs ofthe relevant assets.
Category, estimated useful life, estimated net residual value rate and annual amortization rate of intangibleassets are shown below:
Category of intangible assets | Estimated useful life (years) | Estimated net residual value rate (%) | Annual amortization rate (%) |
Land use right | 50 | 0 | 2.00 |
Trademark
Trademark | 7-10 | 0 | 14.29-10.00 |
Computer software | 10 | 0 | 10.00 |
The useful lives and amortization methods of intangible assets with limited useful lives on the balancesheet date shall be reviewed.ii. Subsequent measurement of intangible assets with indefinite useful livesIntangible assets with indefinite useful lives are not amortized in the holding period, but impairment testsare performed at the end of each year.c) Estimates of useful lives of intangible assetsi. For intangible assets from any contractual right or other statutory rights, their useful lives shall berecognized according to the period no more than that of the contractual or other statutory rights; when thecontractual right or other statutory rights contract is extended due to renewal of contracts and there isevidence that the renewal of the Company does not need large costs, the renewal period shall be included intothe useful lives.ii. Where the contract or the law fails to specify the useful lives, the Company integrates situations in allaspects and determine the period of intangible assets that can bring economic benefits for the Company byhiring the relevant experts to demonstrate or comparing with the situation of the industry as well as referringto the Company’s historical experience or otherwise.
iii. If it is still unable to reasonably determine that intangible assets may bring economic benefits for theCompany according to the above methods, the intangible assets are taken as intangible assets with indefiniteuseful lives.
(2) Accounting policies of internal research and development expenditure
According to the actual situation of the research and development, the Company classifies the researchand development project into that on the research phase and that on the development phase.
a) Research stage
Research stage is the stage when creative and planned investigations and research activities are conductedto acquire and understand new scientific or technological knowledge.
b) Development stage
Development stage is the stage when the research achievements or other knowledge are applied to a planor design, prior to the commercial production or use, so as to produce any new or substantially improvedmaterial, device or product.
Expenditure of an internal research and development project on the research phase shall be included incurrent profit and loss when it occurs.
Specific criteria for qualifying expenditure on the development phase for capitalization
Expenditure on the development phase of an internal research and development project shall berecognized as intangible assets only when the following conditions are simultaneously satisfied:
i. It is technically feasible to finish intangible assets for use or sale;
ii. It is intended to finish and use or sell the intangible assets;
iii. The usefulness of intangible assets to generate economic benefits shall be proved, including being ableto prove that there is a potential market for the products manufactured by applying the intangible assets orthere is a potential market for the intangible assets themselves or the intangible assets will be used internally;
iv. It is able to finish the development of the intangible assets, and able to use or sell the intangible assets,with the support of sufficient technologies, financial resources and other resources;
v. The expenditure attributable to the intangible asset during its development phase can be measured
reliably.
21. Non-current assets impairment
If there are impairment indicators of long-term equity investment, investment property measured at costmodel, fixed assets, construction in progress, right-of-use assets, intangible assets with indefinite useful livesand other long-term assets at balance sheet date, impairment test should be performed. If the result ofimpairment test shows that recoverable amount is less than its book value, the difference should be providedfor impairment and recorded into impairment loss. The recoverable amount is the higher of fair values lesscosts of disposal and the present values of the future cash flows expected to be derived from the asset.Provision for impairment is calculated and recognized on the basis of individual asset. If recoverable amount ofindividual asset is difficult to be estimated, the Company should recognize the recoverable amount of the assetgroup which the individual asset belongs to. Asset group is the minimum asset group which can generate cashinflow separately.
The Company should perform impairment test for goodwill and intangible assets with indefinite life at leastat each year end, no matter whether there is impairment indicator.
When the Company performs impairment test, book value of goodwill arising from business combinationshould be amortized to relevant asset group using the reasonable method from the date of purchase. If it isdifficult to amortize it to relevant asset group, amortize it to relevant asset group portfolio. Apportion bookvalue of goodwill to relevant asset group or asset group portfolio according to the proportion of fair value ofasset group or asset group portfolio accounting for total amount of relevant asset group or asset groupportfolio. If fair value is difficult to be measured reliably, amortize according to the proportion of book value ofasset group or asset group portfolio accounting for total amount of relevant asset group or asset groupportfolio. When perform impairment test for asset group or asset group portfolio including goodwill, if there isimpairment indicator of asset group or asset group portfolio relevant to goodwill, perform impairment test forasset group or asset group portfolio without goodwill firstly, calculate its recoverable amount, compare withrelevant book value and recognize impairment loss. Then perform impairment test for asset group or assetgroup portfolio including goodwill, compare book value of the asset group or asset group portfolio (includingproportional book value of goodwill) and its recoverable amount, if recoverable amount of relevant assetgroup or asset group portfolio is less than its book value, recognize impairment loss of goodwill.
Once impairment loss stated above is recognized, reversal is not allowed in the subsequent accountingperiods.
22. Long-term deferred expenses
(1) Scope of long-term deferred expenses
Long-term deferred expenses refer to various expenses which have been already incurred but will be bornin this period and in the future with an amortization period of over 1 year (exclusive).
(2) Initial measurement of long-term deferred expenses
Long-term deferred expenses shall be initially measured according to the actual costs incurred.
(3) Amortization of long-term deferred expenses
Long-term deferred expenses are amortized using the straight-line method over the beneficial period.
23. Contract liability
Contract liabilities refer to the obligation of a company to transfer commodities to customers forconsideration received or receivable from customers. If the customer has paid the contract consideration or
the company has obtained an unconditional right to receive the goods prior to the company's transfer of thegoods to the customer, the company will show the amount received or receivable as a contractual liability inwhich earlier the customer actually pays the amount or the amount becomes due. The contract assets andcontract liabilities under the same contract shall be shown on a net basis, and the contract assets and contractliabilities under different contracts shall not be set off.
24. Employee benefits
(1) Accounting treatment of short-term benefits
Short-term benefits are the benefits that the Company expect to pay in full within 12 months after thereporting period in which the employee provided relevant services, excluding the compensation foremployment termination.Short-term benefits include: wage, bonus, allowance and subsidy; employee welfare, social securitiesincluding health insurance and work injury insurance; housing common reserve fund; union expenditure andemployee training expenditure; short-term paid leave; short-term profit-sharing; non-monetary welfare andother short-term benefits.Actual short-term benefits will be recognized as liability during the accounting period in which theemployee is providing the relevant service to the Company. The liability will be included in the current profitsand losses or the cost relevant assets.
(2) Accounting treatment of post-employment benefits
The defined contribution plan of the Company includes payments of basic pension, unemploymentinsurance, annuity, etc. that accord to relevant provisions. The amount which the Company deposit on balancesheet date in exchange for the service of the employee during the accounting period will be recognized asemployee benefits liability and shall be included into the profit or loss for the current period.
(3) Accounting treatment of termination benefits
Termination benefits are the benefits the Company provide to the employee when the Companyterminates the employment before labor contract expires or encourages voluntary resignation. Employeebenefits liabilities shall be recognized and included into profit or loss for the current period on the earlier dateof the two following circumstances:
a) When the Company is not able to withdraw the benefits from termination of employment or resignationpersuasion unilaterally;
b) When the Company recognizes costs and fees relevant to reforming the termination benefits payment.
(4) Accounting treatment of other long-term employee benefits
Other long-term employee benefits are all employee benefits other than short-term benefits,post-employment benefits and termination benefits. At the end of reporting period, the company willrecognize the employee benefits cost from other long-term employee benefits as the following components:
a) Service cost;
b) Net amount of interest from other long-term employee benefits net liabilities or assets;
c) Changes from recalculation of the net liabilities or assets from other long-term employee benefits.
In order to simplify related accounting procedure, the net amount of the above subjects shall be includedinto current profit or loss or the cost of relevant assets.
25. Lease liabilities
(1) Initial measurement
At the commencement date, a lessee shall measure the lease liability at the present value of the leasepayments that are not paid at that
a) Lease paymentThe lease payments included in the measurement of the lease liability comprise the following payments forthe right to use the underlying asset during the lease term that are not paid at the commencement date:
i. fixed payments (including in-substance fixed payments) less any lease incentives receivable;ii. variable lease payments that depend on an index or a rate, initially measured using the index or rate asat the commence date;iii. The exercise price of the purchase option, if the Company is reasonably certain to exercise that option;iv. Payments of penalties for terminating the lease, if the lease term reflects the lessee exercising an optionto terminate the lease;
v. The amount expected to be paid based on the residual value of the guarantee provided by the company.b) The discount rateWhen calculating the present value of lease payments, the interest rate in the lease is determined as thediscount rate. If the rate cannot be readily determined, the Company shall use the lessee’s incrementalborrowing rate, which is the rate of interest that a lessee would have to pay to borrow over a similar term, andwith a similar security, the funds necessary to obtain an asset of a similar value to the right-of-use asset in asimilar economic environment. The incremental borrowing rate is based on the bank lending rate and adjustedby the Company considering relevant factors.
(2) Subsequent measurement
After the commencement date, the Company shall measure the lease liability by:
①increasing the carrying amount to reflect interest on the lease liability;
② reducing the carrying amount to reflect the lease payments made;
③ remeasuring the carrying amount to reflect any reassessment or lease modificationsAfter the lease commencement date, lease payment shall be remeasured if the following circumstancesincurred, and the lease liability shall be remeasured at the present value which is based on the revised leasepayment and revised discounting rate. The Company shall remeasure the lease liability to reflect changes tothe lease payments. A lessee shall recognize the amount of the remeasurement of the lease liability as anadjustment to the right-of-use asset. However, if the carrying amount of the right-of-use asset is reduced tozero and there is a further reduction in the measurement of the lease liability, a lessee shall recognize anyremaining amount of the remeasurement in profit or loss.
①change of in-substance fixed payments (subject to original discounting rate)
②change of amounts expected to be payable under residual value guarantees
③change of an index or a rate used for future lease payments
④change in assessment of a buy option
The interest expense during each period of the lease term shall be included in the current profit and loss ,except for those that should be capitalized.
26. Provisions
(1) Recognition principles of provision
When obligations related to external guarantees, pending actions or arbitration, product quality assurance,onerous contracts, reorganization and contingencies satisfy the following three conditions, they shall berecognized as provision:
a) This obligation is a present obligation of the Company;
b) The settlement of such obligation is likely to result in outflow of economic benefits from the Company;and
c) The amount of the obligation can be measured reliably.
(2) Measurement method of provision
The amount of provision is measured at the best estimate of expenses required for contingencies.a) If there is continuous range for the necessary expenses, and probabilities of occurrence of all theoutcomes within this range are equal, the best estimate shall be determined at the median of the range.b) The best estimate shall be accounted as follows in other cases:
i. If the contingency involves a single item, the best estimate shall be determined at the most likelyoutcome.ii. If the contingency involves two or more items, the best estimate should be determined according to allthe possible outcomes with their relevant probabilities.
27. Share-based payment
Share-based payment is classified as equity-settled share-based payment and cash- settled share-basedpayment.
(1) Accounting treatment on the date of granting
The Company does not make any accounting treatment on the date of granting, neither for equity-settledshare-based payment nor for cash-settled share-based payment, except that the right of the share-basedpayment can be exercised immediately.
(2) Accounting treatment on each balance sheet date within vesting period
On each balance sheet date within vesting period, the Company records the service provided by employeesor other party as cost and expense, and recognizes equity or liability at the same time.
For the share-based payment attached with market conditions, once employees satisfy all conditionsexcept market conditions, the service acquired can be recognized. If the performance condition is not marketcondition, the estimate for previous periods can be revised when the vesting period is determined andsubsequent information shows that the estimate for conditions of exercising rights requires adjustments.
For equity-settled share-based payment related with employees, charge the service into costs, expensesand capital reserve (other capital reserve), using the fair value of the equity instrument on the date of granting.The subsequent changes of fair value should not be recognized. For cash-settled share-based payment relatedwith employees, recalculate fair value of the equity instrument at each balance sheet date and recognizerelated costs, expenses and employee benefit payable.
At each balance sheet date within vesting period, the Company makes the best estimate and revises thenumber of equity instrument that can be exercised according to the latest subsequent information such aschange of number of employees who can exercise rights.
Use fair value and the number of equity instrument stated above to calculate cumulative amount of costsand expenses that should be recognized by this period and then deduct the cumulative amount alreadyrecognized in the previous period. The balance is the amount of cost and expense that should be recognized inthe current period.
(3) Accounting treatment after the date when rights can be exercised
For equity-settled share-based payment, after the date when rights can be exercised, no adjustment shallbe made to the total amount of the cost expense and equity already recognized. The Company recognizesshare capital and capital premium, and carry forward the capital reserve (other capital reserve) recognizedwithin vesting period at the he dates when rights can be exercised.
For cash-settled share-based payment, the Company shall not recognize costs and expenses. The change offair value of liability (employee benefit payable) should be recorded into current profit or loss (profit or lossarising from fair value changes) after the date when rights can be exercised.
(4) Accounting treatment for repurchasing shares regarding employee option incentive.When the Company encourages employees in the form of repurchasing shares, total expenditure ofrepurchasing shares is regarded as treasury stock and registered for check. At each balance sheet date withinvesting period, charge the employee service acquired into costs and expenses, and meanwhile increase capitalreserve (other capital reserve), using fair value of the equity instrument at the date of granting. When theemployee exercises the right to buy the Company’s shares and receives the amount, write off the cost oftreasury stock delivered to the employee and the cumulative amount of capital reserve (other capital reserve)recognized within the vesting period, meanwhile the balance adjusting capital reserve (share capital premium).
28.Revenue
Accounting policies adopted in revenue recognition and measurement
(1) Principle and measurement method of revenue recognition
a) Revenue recognitionThe Company has fulfilled its contractual performance obligation to recognize revenue when the customeracquires control of the relevant goods. On the beginning date of the contract, the Company evaluates thecontract, identifies the individual performance obligations contained in the contract, and determines whetherthe individual performance obligations are performed within a certain period of time or at a certain point.Then, the Company recognizes the revenue when the individual performance obligations are fulfilled.
b) Revenue measurementIf the contract contains two or more performance obligations, the Company shall, on the commencementdate of the contract, apportion the transaction price to each single performance obligation according to therelative proportion of the separate selling price of the commodity or service committed by each singleperformance obligation, and measure the revenue according to the transaction price apportioned to eachsingle performance obligation. In determining the transaction price, the Company will take into account theimpact of variable consideration, material financing elements existing in the contract, non-cash considerationand customer consideration payable, and it is assumed that the goods will be transferred to the customer inaccordance with the provisions of the existing contract and that the contract will not be canceled, renewed orchanged.
(2) Specific revenue recognition policies
a) Sales contractThe Company's sales products, promotional products and other goods belong to the performanceobligations performed at a certain point.
The Company recognizes the sales revenue when the goods are delivered to the customer and the controlof the goods is transferred. For export sales business, the Company recognizes the revenue after the goods aredelivered and the customs clearance procedures are completed.According to the marketing policy, and the distributor sales of final product, the Company gives thedistributor a percentage discount, and regularly or irregularly settles with distributors. At the time ofsettlement, the discounts are recorded in a sales invoice issued. The net amount of invoice value after thededuction of the discount sales income is recognized as revenue according to the accrual principle. Thediscounts that have occurred and have not yet been settled at the end of the current period shall be takenprovision from the sales revenue and recorded into the contract liabilities.b) Service ContractThe service contract provided by the Company contains the performance obligation of the lease service
provided. Since the customer obtains and consumes the economic benefits brought by the performance of thecontract at the same time, it is regarded as the performance obligation performed within a certain period oftime and is equally apportioned and confirmed during the service provision.
29. Government grants
(1) Types of government grants
Government grants are monetary assets and non-monetary assets acquired free of charge by the Companyfrom the government, including government grants related to assets and government grants related toincome.
Government grants related to assets are government grants that are acquired by the Company and used forforming long-term assets through purchasing and constructing or other ways.
Government grants related to income are government grants other than government grants related toassets.
(2) Recognition principles of government grants
Government grants are recognized when both of the following conditions are met:
a) The Company can meet the attached conditions for the government grants;
b) The Company can receive the grants.
(3) Measurement of government grants
a) If a government grant is a monetary asset, it shall be measured in the light of the received or receivableamount.
b) If a government grant is a non-monetary asset, it shall be measured at its fair value; and if its fair valuecannot be obtained in a reliable way, it shall be measured at a nominal amount (a nominal amount is CNY 1).
(4) Accounting treatment method of government grants
a) The government grants related to assets shall be set off of the book value of the related assets orrecognized as deferred income at the actual entry amount on acquisition. Government grants recognized asdeferred income shall be allocated evenly over the useful lives of the relevant assets, and included in thecurrent profit or loss. Government grants measured at the nominal amount shall be directly included in currentprofit and loss.
b) Government grants related to income shall be separately handled according to the followingcircumstances:
i. If government grants related to income are used to compensate the Company’s relevant expenses orlosses in future periods, such government grants should be recognized as deferred income on acquisition andbe included into the current profit and loss or written off of the related costs when the relevant expenses,losses are recognized.
ii. If government grants related to income are used to compensate the
Company’s relevant expenses or losses incurred, such government grants are directly included into thecurrent profit and loss on acquisition or written off of the related costs.
c) Government grants related to assets and related to income are received together, shall be treatedseparately. If it is hard to separate, government grants shall be treated as related to income as a whole.
d) Government grants related to daily operation shall be recoded in other income or written off relevantexpenses, costs. Government grants unrelated to daily operation shall be recorded in non-operating income.
Financial subsidy funds directly allocated to the company shall be offset the relevant borrowing costs.e) Government grants already recognized required to be refunded shall be handled according to thefollowing circumstances:
i. If the grants have written down the book value of assets, the book value shall be adjusted.ii. If there is related deferred income, the book value of relevant deferred income is written down and theexceeding part is recorded in the current profit and loss.
iii. If there is no related deferred income, the exceeding part is directly included in the current profit andloss.
30. Deferred tax assets and deferred tax liabilities
The Company adopts the balance sheet liability method to account for income tax.
(1) Recognition of deferred tax assets or deferred tax liabilities
a) The Company recognizes its tax base on acquisition of assets and liabilities. On the balance sheet date,the Company analyzes and compares the book value of the assets and liabilities and the tax base. If there aretemporary differences in book value of the assets and liabilities and the tax base, under the circumstance thatthe temporary differences incur in the current period and meet the recognition criteria, the Company shallrespectively recognize taxable temporary differences or deductible temporary differences as deferred taxliability or deferred tax assets.
b) Recognition basis of deferred tax assets
i. Deferred tax assets incurred from deductible temporary differences are recognized to the extent thatthey shall not exceed the taxable income probably obtained in future periods to be against the deductibletemporary difference. In determining the taxable income probably obtained in future periods, including thetaxable income from normal production and operation activities in future periods and the increase of taxableincome due to the reversal of taxable temporary differences during the period of reversal of deductibletemporary differences.
ii. For deductible losses and tax credits that can be carried forward to the next years, the Company is likelyto recognize the corresponding deferred tax assets to the extent that the assets shall not exceed the taxableincome in the future for deducting deductible losses and tax credits and that are probably obtained by theCompany.
iii. On the balance sheet date, the Company reviews the book value of deferred tax assets. If it is probablyunable to obtain sufficient taxable income in the future period to offset the benefits of the deferred tax assets,the Company shall write down the book value of the deferred tax assets; when it is probable to obtainsufficient taxable income, the write-downs shall be reversed.
c) Recognition basis of deferred tax liabilities
The Company recognizes the current and previous taxable temporary differences payable but unpaid asdeferred tax liabilities. But they exclude temporary differences arising from goodwill; transactions which areformed other than from business combinations and neither affect the accounting profits nor affect taxableincome at the time of occurrence.
(2) Measurement of deferred tax assets or deferred tax liabilities
a) On the balance sheet date, the deferred tax assets and deferred tax liabilities are measured at theapplicable tax rate during the period of expected recovery of the assets or liquidation of the liabilities inaccordance with the provisions of the tax law.
b) Where the applicable tax rate changes, the Company remeasures deferred tax assets and deferred taxliabilities recognized, except for those incurred in transactions or events directly recognized in the owner’s
equity, of which the effect shall be included in the income tax expenses in the current period when the ratechanges.
c) When the Company measures the deferred tax assets and deferred tax liabilities, the tax rate and taxbase in consistent with the expected recovery of assets or liquidation of liabilities shall be adopted.d) Deferred tax assets and deferred tax liabilities of the Company shall not be discounted.
31. Lease
(1) Accounting treatment for operating lease
According to the nature of the assets, the company will include the assets used as operating lease in therelevant items of the balance sheet. The Company shall add initial direct costs incurred in obtaining anoperating lease to the carrying amount of the underlying asset and recognize those costs as an expense overthe lease term on the same basis as the lease income. Lease payment received shall be recognized as leaseincome on a straight-line basis within the period. The depreciation policy for depreciable underlying fixedassets subject to operating leases shall be consistent with the lessor’ s normal depreciation policy for similarassets. Amortization for other underlying assets subject to operating lease shall be on reasonable systematicbasis. The variable lease payments obtained by the company related to operating leases, which are notincluded in the lease payment received, shall be included in the current profit and loss when actually incurred.
A lessor shall account for a modification to an operating lease as a new lease from the effective date of themodification, considering any prepaid or accrued lease payments relating to the original lease as part of thelease payments for the new lease.
(2) Accounting treatment for finance lease
At the commencement date of the lease term, the Company recognizes the finance lease receivable at thenet value of lease investment (the sum of the unguaranteed residual value and the present value of the leasereceipts not yet received at the commencement date of the lease term that are discounted at the interest ratein the lease) and derecognizes the finance lease asset. Over the term of the relevant lease, the Companycalculates and recognizes interest income based on the interest rate in the lease.
The company shall account for a finance lease modification as a separate lease if both conditions aresatisfied: ① the modification increases the scope of the lease by adding the right to use one or moreunderlying assets or extending the contractual lease term. ② the consideration for the lease increases by anamount commensurate with the stand-alone price for the increase in scope or the contractual lease termextension and any appropriate adjustments to that stand-alone price to reflect the circumstances of theparticular contract. Stand-alone price to reflect the circumstances of the particular contract.
32. Changes in significant accounting policies and accounting estimates
(1) Changes in significant accounting policies
□Applicable ?N/A
(2) Changes in significant accounting estimates
□Applicable ?N/A
33. Other
None.
VI. Taxes
1. Major tax types and rates
Tax type | Taxation basis | Tax rate |
Value-added tax (VAT) | Output tax-deductible input tax | 13%、9%、6%、19% |
Consumption tax | Sales revenue or composite assessable price | |
Urban maintenance and construction tax | Applicable turnover tax amount | 7%、5% |
Corporate income tax | Applicable income tax rate Taxable income | 25%、16.5%、0%、27% |
Disclosure statement if there are various taxpaying bodies with different corporate income tax rates
Company name | Applicable tax rate |
JSSJ Industry (HK) Holdings Co., Ltd. | 16.50% |
Hong Kong Zhaiugou International Trade Co., Ltd. | 16.50% |
ZYG E-Commerce HK Limited | 16.50% |
Yanghe Hong Kong Distillery Co., Ltd. | 16.50% |
YANGHE CHILE SPA | 27% |
YangHe International Investment Ltd | 0% |
ZYG LTD and ZYG TECHNOLOGY INVESTMENT LTD | 0% |
2. Tax incentives
None.
3.Other information
(1) Ad valorem taxation: liquor consumption tax shall be calculated and paid according to 20% of theapproved sales amount. The taxable liquor commissioned for processing shall be taxed according to the salesprice of similar liquor of the entrusted party, and if there is no sales price of similar liquor, the taxable liquorshall be computed according to the composition assessable price. Consumption tax on red wine (wine) iscalculated at 10% of sales.
(2) Quantity-based taxation: liquor consumption tax is calculated and paid according to CNY 1 per kg.VII. Notes to items in the consolidated financial Statements (all currency unit is CNY,
except other statements)
1. Cash and Bank Balances
Unit: CNY
Item | Closing balance | Opening balance |
Cash | 3,549.27 | |
Bank deposit | 24,331,397,524.64 | 20,894,755,169.16 |
Other cash and cash equivalents | 44,051,907.69 | 61,072,291.69 |
Total | 24,375,449,432.33 | 20,955,831,010.12 |
Including: total deposit outbound
Including: total deposit outbound | 49,598,745.91 | 80,215,579.77 |
Other notesOn December 31st 2022, the interest receivable for time deposit is RMB 356,432,891.61; The endingbalance of other currency funds is mainly the funds deposited in Tenpay, Alipay and other platforms.Liquor manufacturing enterprises should disclose in detail whether there is any special interest arrangementsuch as the establishment of capital co-management accounts with relevant parties
□Applicable ?N/A
2. Held-for-trading financial assets
Unit: CNY
Item | Closing balance | Opening balance |
Financial asset at fair value through profit and loss | 7,998,150,119.16 | 10,953,894,328.01 |
Including: | ||
Equity instrument | 47,300,000.00 | |
Debt instruments | 7,998,150,119.16 | 10,906,594,328.01 |
Including: | ||
Total | 7,998,150,119.16 | 10,953,894,328.01 |
Other notesDebt instruments are bank financial products and trust financial products that mature within one year
3. Notes receivables
(1) Classification of notes receivables
Unit: CNY
Item | Closing balance | Opening balance |
Bank acceptance bill | 526,004,730.00 | 663,849,328.28 |
Total | 526,004,730.00 | 663,849,328.28 |
Unit: CNY
Item | Closing balance | Opening balance | ||||||||
Book balance | Provision for bad debt | Book value | Book balance | Provision for bad debt | Book value | |||||
amount | proportion | amount | proportion | amount | proportion | amount | proportion | |||
Including: | ||||||||||
Provision for bad debt of notes receivables by portfolio | 526,004,730.00 | 526,004,730.00 | 663,849,328.28 | 663,849,328.28 | ||||||
Including: | ||||||||||
Bank acceptance bill portfolio | 526,004,730.00 | 526,004,730.00 | 663,849,328.28 | 663,849,328.28 | ||||||
Total | 526,004,730. | 526,004,730.00 | 663,849,328.28 | 663,849,328.2 |
00 | 8 |
Provision for bad debt by individual: 0.00
Unit: CNY
Item | Closing balance | ||
Book balance | Provision for bad debt | Proportion | |
Bank acceptance bill portfolio | 526,004,730.00 | ||
Total | 526,004,730.00 |
Notes to determine provision for bad debt by portfolio:
If provision for bad debt of notes receivable is calculated according to the general model of expected creditloss, please refer to the disclosure method of other receivables to disclose the relevant information aboutprovision for bad debt:
□Applicable ?N/A
(2) Notes receivable that have been endorsed to other parties by the Company but have not expired atthe end of year
Unit: CNY
Item | Derecognition at period end | Not derecognition at period end |
Bank acceptance bill | 422,394,730.00 | |
Total | 422,394,730.00 |
4. Accounts receivables
(1) Disclosed by categories
Unit: CNY
Category | Closing balance | Opening balance | ||||||||
Book balance | Provision for bad debt | Book value | Book balance | Provision for bad debt | Book value | |||||
Amount | Proportion | Amount | Proportion | Amount | Proportion | Amount | Proportion | |||
Including: | ||||||||||
Provision for bad debt by portfolio | 49,543,070.14 | 100.00% | 4,400,177.36 | 8.88% | 45,142,892.78 | 4,082,161.80 | 100.00% | 2,834,211.89 | 69.43% | 1,247,949.91 |
Including:: | ||||||||||
Risk portfolio | 49,543,070.14 | 100.00% | 4,400,177.36 | 8.88% | 45,142,892.78 | 4,082,161.80 | 100.00% | 2,834,211.89 | 69.43% | 1,247,949.91 |
Total | 49,543,070.14 | 100.00% | 4,400,177.36 | 8.88% | 45,142,892.78 | 4,082,161.80 | 100.00% | 2,834,211.89 | 69.43% | 1,247,949.91 |
Provision for bad debts by portfolio:
Unit: CNY
Aging | Closing balance | ||
Accounts receivables | Provision for bad debt | Proportion of provision | |
Within1 year (including 1 year) | 46,205,254.29 | 1,386,157.64 | 3.00% |
1-2 years | 230,463.47 | 23,046.35 | 10.00% |
2-3 years | 123,334.80 | 24,666.96 | 20.00% |
Over 3 years
Over 3 years | 2,984,017.58 | 2,966,306.41 | 99.41% |
Total | 49,543,070.14 | 4,400,177.36 |
Notes to determine provision for bad debt by portfolio:
If provision for bad debt of accounts receivables is calculated according to the general model of expectedcredit loss, please refer to the disclosure method of other receivables to disclose the relevant informationabout provision for bad debt:
□Applicable ?N/A
Disclosed by aging Unit: CNY
Aging | Book value |
Within1 year (including 1 year) | 46,205,254.29 |
Within1 year | 46,205,254.29 |
1-2 years | 230,463.47 |
2-3 years | 123,334.80 |
Over 3 years | 2,984,017.58 |
3-4 years | 27,021.00 |
4-5 years | 21,003.29 |
Over 5 years | 2,935,993.29 |
Total | 49,543,070.14 |
(2) Provision for bad debt that is accrued, recovered or reversed during this periodProvision for bad debts during this period:
Unit: CNY
Category | Opening balance | Changes in the current period | Closing balance | |||
Provision | Recovered or reversed | Write off | Others | |||
Provision for bad debt of accounts receivables | 2,834,211.89 | 1,565,965.47 | 4,400,177.36 | |||
Total | 2,834,211.89 | 1,565,965.47 | 4,400,177.36 |
Significant amount of reversal or recovery during this period
Unit: CNY
Company name | Amount recovered or reversed | Method |
(3) Top five entities with the largest balances of the accounts receivables
Unit: CNY
Company's name | Closing balance | Proportion in the total accounts receivables | Provision amount |
First | 10,693,847.15 | 21.58% | 320,815.41 |
Second | 10,125,399.40 | 20.44% | 303,761.98 |
Third | 5,053,213.00 | 10.20% | 151,596.39 |
Fourth | 1,671,379.39 | 3.37% | 50,141.38 |
Fifth
Fifth | 600,000.00 | 1.21% | 600,000.00 |
Total | 28,143,838.94 | 56.80% |
5. Receivables for Financing
Unit: CNY
Item | Closing Balance | Opening Balance |
Bank acceptance bill | 623,098,310.00 | 222,793,060.40 |
Total | 623,098,310.00 | 222,793,060.40 |
Increase or decrease of receivable financing for the current period and changes in its fair value.
□Applicable ?N/A
If a provision for impairment is made for receivable financing in accordance with the general model ofexpected credit losses, please disclose relevant information on the provisions for impairment with reference tothe disclosure method of other receivables.
□Applicable ?N/A
6. Prepayment
(1) Analysis by aging
Unit: CNY
Aging | Closing balance | Opening balance | ||
Amount | Proportion | Amount | Proportion | |
Within 1 year | 10,442,862.34 | 94.77% | 8,077,156.80 | 85.85% |
1-2 years | 430,756.91 | 3.91% | 154,508.03 | 1.64% |
2-3 years | 4,996.76 | 0.05% | 757,130.80 | 8.05% |
Over 3 years | 140,477.59 | 1.27% | 419,972.49 | 4.46% |
Total | 11,019,093.60 | 9,408,768.12 |
Significant prepayment aging over 1 year without settlement on time:
No significant prepayment aging over 1 year is recorded in the ending balance.
(2) Top five entities with the largest balances of prepayment
Company’s name | Closing balance | Proportion in the total prepayment (%) |
First | 2,481,010.08 | 22.52 |
Second | 2,277,241.70 | 20.67 |
Third | 1,575,000.00 | 14.29 |
Fourth | 1,103,249.58 | 10.01 |
Fifth | 1,097,068.44 | 9.96 |
Total | 8,533,569.80 | 77.44 |
7. Other receivables
Unit: CNY
Item
Item | Closing balance | Opening balance |
Other receivables | 74,362,342.41 | 11,520,008.85 |
Total | 74,362,342.41 | 11,520,008.85 |
(1) Other receivables
a) Other receivables by nature
Unit: CNY
Nature of other receivables | Closing balance | Opening balance |
Savings deposits (infringement dispute) | 22,839,924.27 | 22,839,924.27 |
Deposit | 75,233,431.94 | 18,258,461.27 |
Cooperation | 3,910,000.00 | 3,910,000.00 |
Business loans, petty cash and others | 26,329,410.21 | 21,280,921.11 |
Total | 128,312,766.42 | 66,289,306.65 |
b) Provision for bad debt
Unit: CNY
Bad debt | Stage 1 | Stage 2 | Stage 3 | Total |
Expected credit losses in the next 12 months | Expected credit loss for lifetime (No credit loss occurred) | Expected credit loss for lifetime (Credit loss occurred) | ||
Balance as at 1 January 2022 | 406,088.25 | 54,363,209.55 | 54,769,297.80 | |
Change of opening balance as at 1 January 2022 in current period | ||||
Provision in 2022 | 1,548,524.26 | 1,548,524.26 | ||
Recovery in 2022 | 2,368,403.77 | 2,368,403.77 | ||
Other changes | 1,005.72 | 1,005.72 | ||
Balance as at 31 December 2022 | 1,955,618.23 | 51,994,805.78 | 53,950,424.01 |
Significant changes of loss provision in the book balance during this period.
□Applicable ?N/A
Disclosure by aging
Unit: CNY
Aging | Book value |
Within 1 year(including 1 year) | 72,545,501.15 |
Within 1 year | 72,545,501.15 |
1-2 years | 1,932,940.66 |
2-3 years | 1,147,887.40 |
Over 3 years | 52,686,437.21 |
3-4 years | 140,570.01 |
4-5 years | 3,029,986.98 |
Over 5 years | 49,515,880.22 |
Total | 128,312,766.42 |
c) Provision for bad debt that is accrued, recovered or reversed during this periodProvision for bad debts during this period:
Unit: CNY
Category | Opening balance | Changes in current period | Changes in current period | |||
Provision | Recovered or reversed | Write off | Other changes | |||
Other receivables bad debt provision | 54,769,297.80 | 1,548,524.26 | 2,368,403.77 | 1,005.72 | 53,950,424.01 | |
Total | 54,769,297.80 | 1,548,524.26 | 2,368,403.77 | 1,005.72 | 53,950,424.01 |
Significant amount of reversal or recovery during this period:
Unit: CNY
Entity | Amount of reversal or recov | Method |
d) Top five entities with the largest balances of other receivables
Unit: CNY
Company’s name | Category | Closing balance | Aging | Proportion in total receivable | Provisioning amount at period end |
Xiuwen County Investment Promotion Bureau | Deposit | 55,000,000.00 | Within 1 year | 42.86% | 1,100,000.00 |
Industrial Commercial Bank of China Ltd. Kaifeng Haode branch | Savings deposit (Infringement dispute) | 22,839,924.27 | Over 5 years | 17.80% | 22,839,924.27 |
Bankruptcy administrator of Jiangsu Juntai Properties Co., Ltd., Suqian Guotai Department Store Co., Ltd | Deposit | 15,000,000.00 | Over 5 years | 11.69% | 15,000,000.00 |
Nanjing Peilong Sports Culture Co., Ltd. | Cooperation | 3,910,000.00 | Over 5 years | 3.05% | 3,910,000.00 |
Siyang County Land Acquisition and Reserve Center | Deposit | 2,938,496.00 | Within 1 year | 2.29% | 58,769.92 |
Total | 99,688,420.27 | 77.69% | 42,908,694.19 |
8. Inventories
(1) Categories of Inventories
Unit: CNY
Item | Closing balance | Opening balance | ||||
Book balance | Provision | Book value | Book balance | Provision for | Book value |
for stockobsolescence
for stock obsolescence | stock obsolescence | |||||
Raw material | 426,227,182.05 | 11,868,802.62 | 414,358,379.43 | 438,692,292.37 | 15,300,348.33 | 423,391,944.04 |
Work in progress | 761,814,393.67 | 761,814,393.67 | 661,614,981.98 | 661,614,981.98 | ||
Stock goods | 2,971,329,097.21 | 2,971,329,097.21 | 2,632,674,836.85 | 2,632,674,836.85 | ||
semi-finished goods | 13,581,757,096.23 | 13,581,757,096.23 | 13,085,411,678.94 | 13,085,411,678.94 | ||
Total | 17,741,127,769.16 | 11,868,802.62 | 17,729,258,966.54 | 16,818,393,790.14 | 15,300,348.33 | 16,803,093,441.81 |
The disclosure requirements of food and wine manufacturing-related industries in the Guidelines forSelf-regulation NO.3 of Listed Companies of Shenzhen Stock Exchange -Industry Information Disclosure shall beobserved
(2) Provision for stock obsolescence and impairment provision of contract cost
Unit: CNY
Item | Opening balance | Increases in current period | Decreases in current period | Closing balance | ||
Provision | Other | Recovery or reversal | Other | |||
Raw material | 15,300,348.33 | 2,333,823.54 | 5,765,369.25 | 11,868,802.62 | ||
Total | 15,300,348.33 | 2,333,823.54 | 5,765,369.25 | 11,868,802.62 |
9. Other current assets
Unit: CNY
Item | Closing balance | Opening balance |
VAT to be deducted | 113,102,451.80 | 131,525,820.12 |
Consumption tax to be deducted | 6,734,883.21 | 6,575,730.95 |
Advance payment of income tax | 9,850,655.25 | 4,903,640.51 |
Total | 129,687,990.26 | 143,005,191.58 |
10. Long-term equity investments
Unit: CNY
Investee | Opening balance | Changes in current period | Closing balance | Closing balance of provision for impairment | |||||||
Increase | Decrease | Profit or loss recognized under equity method | Adjustments of other comprehensive income | Other changes in equity | Cash divided or profit declared | Provision for impairment | Other | ||||
1.Joint venture | |||||||||||
Diageo International Spirits Company Limited | 8,173,436.53 | 8,124,100.65 | 909,717.87 | -865,007.06 | -94,046.69 | ||||||
Subtotal | 8,173,436.53 | 8,124,100.65 | 909,717.87 | -865,007.06 | -94,046.69 | ||||||
2.Associated enterprise | |||||||||||
Jiangsu Su Wine Culture Transmission on Co, Ltd. | 5,060,269.76 | 1,099,974.43 | -2,862,049.49 | 3,298,194.70 | |||||||
Nanjing Hesong Culture Technology Co., Ltd. | 3,852,352.73 | -82,056.98 | 3,770,295.75 | ||||||||
Jiangsu Xinghe Investment Management nt Co., Ltd. | 15,657,338.29 | 3,273,240.06 | 18,930,578.35 | ||||||||
Nanjing Huatai Yanghe Equity Investment Master Fund (limited partnership) | 6,980,000.00 | 561.41 | 6,980,561.41 | ||||||||
Subtotal | 24,569,960.78 | 6,980,000.00 | 4,291,718.92 | -2,862,049.49 | 32,979,630.21 | ||||||
Total | 32,743,397.31 | 6,980,000.00 | 8,124,100.65 | 5,201,436.79 | -865,007.06 | -2,956,096.18 | 32,979,630.21 |
11. Other non-current financial assets
Unit: CNY
Item | Closing balance | Opening balance |
Classified as financial assets at fair value through profit and loss | ||
Including: equity instrument investment | 5,848,590,827.45 | 6,358,903,792.90 |
Debt instrument investment | 300,043,333.33 | 1,277,038,356.16 |
Total | 6,148,634,160.78 | 7,635,942,149.06 |
12. Fixed assets
Unit: CNY
Item | Closing balance | Opening balance |
Fixed Assets | 5,794,773,069.53 | 6,276,466,308.05 |
Total | 5,794,773,069.53 | 6,276,466,308.05 |
(1)Details of fixed assets
Unit: CNY
Item | Buildings and constructions | Machinery equipment | Transportation equipment | Other equipment | Total |
Original cost of fixed assets | |||||
1.Opening balance | 8,170,993,500.95 | 3,257,314,034.47 | 68,557,496.20 | 431,032,076.85 | 11,927,897,108.47 |
2.Increase in current period | 140,814,003.78 | 40,638,352.68 | 5,676,284.34 | 20,507,307.58 | 207,635,948.38 |
(1) External purchase | 14,918,193.52 | 47,102.56 | 5,676,284.34 | 20,507,307.58 | 41,148,888.00 |
(2) Transfer from construction in progress | 125,895,810.26 | 40,591,250.12 | 166,487,060.38 | ||
(3) Increase from business combination | |||||
3.Decrease in current period | 1,572,771.20 | 42,136,794.72 | 14,882,492.03 | 8,035,197.51 | 66,627,255.46 |
(1) Disposal or retirement | 1,572,771.20 | 42,136,794.72 | 14,882,492.03 | 8,035,197.51 | 66,627,255.46 |
4.Closing balance | 8,310,234,733.53 | 3,255,815,592.43 | 59,351,288.51 | 443,504,186.92 | 12,068,905,801.39 |
Accumulated depreciation | |||||
1.Opening balance | 3,030,951,723.52 | 2,184,682,379.31 | 59,493,412.49 | 376,303,285.10 | 5,651,430,800.42 |
2.Increase in current period | 391,048,659.54 | 260,975,939.00 | 4,284,339.13 | 22,559,411.78 | 678,868,349.45 |
(1) Provision | 391,048,659.54 | 260,975,939.00 | 4,284,339.13 | 22,559,411.78 | 678,868,349.45 |
3.Decrease in current period | 754,910.54 | 35,471,641.96 | 13,511,424.47 | 6,428,441.04 | 56,166,418.01 |
(1) Disposal or retirement | 754,910.54 | 35,471,641.96 | 13,511,424.47 | 6,428,441.04 | 56,166,418.01 |
4.Closing balance | 3,421,245,472.52 | 2,410,186,676.35 | 50,266,327.15 | 392,434,255.84 | 6,274,132,731.86 |
Provision for fixed asset impairment |
1.Opening balance
1.Opening balance | |||||
2.Increase in current period | |||||
(1) Provision | |||||
3.Decrease in current period | |||||
(1) Disposal or retirement | |||||
4.Closing balance | |||||
Book value | |||||
1.Closing book value | 4,888,989,261.01 | 845,628,916.08 | 9,084,961.36 | 51,069,931.08 | 5,794,773,069.53 |
2.Opening book value | 5,140,041,777.43 | 1,072,631,655.16 | 9,064,083.71 | 54,728,791.75 | 6,276,466,308.05 |
(2) Investment properties without certification of right
Unit: CNY
Item | Book value | Reason for not having the certification of right |
Yanghe Blue-collar workers apartment | 29,009,949.65 | In process |
Yanghe 40,000-ton pottery jar warehouse | 158,664,124.59 | In process |
Yanghe workshop etc. | 164,491,024.99 | In process |
property of the subsidiary, etc. | 4,588,086.29 | In process |
Total | 356,753,185.52 |
13. Construction in progress
Unit: CNY
Item | Closing balance | Opening balance |
Construction in progress | 757,145,492.90 | 525,497,000.26 |
Total | 757,145,492.90 | 525,497,000.26 |
(1) Details of the construction in progress
Unit: CNY
Item | Closing balance | Opening balance | ||||
Book Balance | Provision for impairment | Book value | Book Balance | Provision for impairment | Book value | |
Shuanggou 120000 ton pottery jar storage project | 3,670,946.95 | 3,670,946.95 | ||||
Shuanggou packaging production line | 17,191,907.04 | 17,191,907.04 | 17,191,907.04 | 17,191,907.04 | ||
Siyang base three-dimensional warehouse, packaging production line projec | 1,100,810.08 | 1,100,810.08 | 1,100,810.08 | 1,100,810.08 | ||
40,000 tons of pottery jar warehouse project | 1,809,904.55 | 1,809,904.55 | 11,494,210.42 | 11,494,210.42 | ||
Nanjing operation center building project | 355,622,206.07 | 355,622,206.07 | 226,554,154.35 | 226,554,154.35 | ||
Sesame Fragrant Intelligent brewing Project (Workshop 115, District 3) | 51,567,809.53 | 51,567,809.53 | 51,649,644.39 | 51,649,644.39 | ||
20,000 tons of pottery jar warehouse project | 6,814,642.25 | 6,814,642.25 | 23,661,457.42 | 23,661,457.42 | ||
sewage treatment capacity expansion and reconstruction project | 15,827,143.46 | 15,827,143.46 | 14,832,564.56 | 14,832,564.56 | ||
80,000 tons of pottery jar warehouse project | 75,199,149.07 | 75,199,149.07 | 7,146,540.68 | 7,146,540.68 | ||
Comprehensive brewing plant | 2,753,290.37 | 2,753,290.37 | 4,798,126.18 | 4,798,126.18 | ||
Exhibition and Decoration Engineering of Wine History Museum, Wine Rhyme Museum, and Wine Art Museum | 61,055,364.82 | 61,055,364.82 | ||||
Phase II of Gui wine project | 62,362,038.53 | 62,362,038.53 | 43,619,689.76 | 43,619,689.76 | ||
Other projects | 102,170,280.18 | 102,170,280.18 | 123,447,895.38 | 123,447,895.38 | ||
Total | 757,145,492.90 | 757,145,492.90 | 525,497,000.26 | 525,497,000.26 |
(2) Significant changes in construction in progress
Unit: CNY
Item | Budget | Opening balance | Increase in current period | Transfer into fixed assets | Other decreases | Closing balance | Proportion of accumulative project input in budget (%) | Progress | Interest capitalization rate | Include:Capitalized interest for the period | Capitalization rate for the period | Source of funds |
Shuanggou 120000 ton | 1,000,000,000.00 | 3,670,946.95 | 3,670,946.95 | 0.37% | Early stage | Other |
pottery jarstorageproject
pottery jar storage project | ||||||||||||
Shuanggou packaging production line | 120,000,000.00 | 17,191,907.04 | 17,191,907.04 | 95.01% | Late stage | Other | ||||||
Siyang base three-dimensional warehouse, packaging production line projec | 41,000,000.00 | 1,100,810.08 | 1,100,810.08 | 64.97% | Late stage | Other | ||||||
40,000 tons of pottery jar warehouse project | 360,000,000.00 | 11,494,210.42 | 5,196,594.13 | 14,880,900.00 | 1,809,904.55 | 57.35% | Late stage | Other | ||||
Nanjing operation center building project | 800,000,000.00 | 226,554,154.35 | 129,068,051.72 | 355,622,206.07 | 51.94% | Middle stage | Other | |||||
Sesame Fragrant Intelligent brewing Project (Workshop 115, District 3) | 68,842,800.00 | 51,649,644.39 | 1,004,453.59 | 1,086,288.45 | 51,567,809.53 | 84.10% | Late stage | Other | ||||
20,000 tons of pottery jar warehouse project | 42,000,000.00 | 23,661,457.42 | 29,842,568.27 | 46,689,383.44 | 6,814,642.25 | 128.94% | Late stage | Other | ||||
sewage treatment capacity expansion | 23,000,000.00 | 14,832,564.56 | 1,221,127.57 | 226,548.67 | 15,827,143.46 | 69.80% | Middle stage | Other |
andreconstruction project
and reconstruction project | ||||||||||||
80,000 tons of pottery jar warehouse project | 240,000,000.00 | 7,146,540.68 | 68,052,608.39 | 75,199,149.07 | 31.34% | Middle stage | Other | |||||
Comprehensive brewing plant | 40,000,000.00 | 4,798,126.18 | 27,868,796.06 | 29,913,631.87 | 2,753,290.37 | 81.67% | Late stage | Other | ||||
Exhibition and Decoration Engineering of Wine History Museum, Wine Rhyme Museum, and Wine Art Museum | 90,000,000.00 | 61,055,364.82 | 61,055,364.82 | 67.84% | Middle stage | Other | ||||||
Phase II of Gui wine project | 139,540,200.00 | 43,619,689.76 | 21,397,215.98 | 2,654,867.21 | 62,362,038.53 | 46.59% | Middle stage | Other | ||||
Total | 2,964,383,000.00 | 402,049,104.88 | 348,377,727.48 | 95,451,619.64 | 654,975,212.72 |
14.Right-of-use Assets
Unit: CNY
Item | Building and construction | Total |
Total original carrying amount | ||
1.Opening balance | 25,119,656.15 | 25,119,656.15 |
2. Increased | 31,783,315.85 | 31,783,315.85 |
(1) New Lease | 31,644,842.71 | 31,644,842.71 |
(2) Other | 138,473.14 | 138,473.14 |
3. Decreased | 8,092,572.74 | 8,092,572.74 |
(1) Disposal | 8,092,572.74 | 8,092,572.74 |
(2) Other | ||
4.Closing balance | 48,810,399.26 | 48,810,399.26 |
Accumulated depreciation | ||
1.Opening balance | 5,509,542.40 | 5,509,542.40 |
2. Increased | 11,223,980.36 | 11,223,980.36 |
(1) Provisions | 11,177,822.64 | 11,177,822.64 |
(2) Other | 46,157.72 | 46,157.72 |
3. Decreased | 2,038,725.77 | 2,038,725.77 |
(1) Disposal | 2,038,725.77 | 2,038,725.77 |
4.Closing balance | 14,694,796.99 | 14,694,796.99 |
Provision for Right-of-use Assets impairment | ||
1.Opening balance | ||
2.Increase in current period | ||
(1) Provision | ||
3.Decrease in current period | ||
(1) Disposal or retirement | ||
4.Closing balance | ||
Total book value | ||
1. Closing balance on book value | 34,115,602.27 | 34,115,602.27 |
2. Opening balance on book value | 19,610,113.75 | 19,610,113.75 |
15. Intangible assets
(1) Details of intangible assets
Unit: CNY
Item | Land use right | Patent right | No-patent right technology | Trademark right | Computer software | Total |
Original cost of intangible assets | ||||||
1.Opening balance | 1,956,702,688.30 | 399,936,371.09 | 157,077,324.41 | 2,513,716,383.80 | ||
2.Increase in | 85,116,919.46 | 8,508,916.43 | 93,625,835.89 |
current period
current period | ||||||
(1)Including: Acquired | 85,116,919.46 | 8,508,916.43 | 93,625,835.89 | |||
(2)Internally developed | ||||||
(3)Business combination | ||||||
3.Decrease in current period | ||||||
(1)Including: Disposal | ||||||
4.Closing balance | 2,041,819,607.76 | 399,936,371.09 | 165,586,240.84 | 2,607,342,219.69 | ||
Accumulated amortization of intangible assets | ||||||
1.Opening balance | 367,309,093.28 | 391,241,186.28 | 75,568,171.18 | 834,118,450.74 | ||
2.Increase in current period | 40,762,281.76 | 2,247,018.10 | 15,833,393.66 | 58,842,693.52 | ||
(1)Including: Provision | 40,762,281.76 | 2,247,018.10 | 15,833,393.66 | 58,842,693.52 | ||
3.Decrease in current period | ||||||
(1)Including: Disposal | ||||||
4.Closing balance | 408,071,375.04 | 393,488,204.38 | 91,401,564.84 | 892,961,144.26 | ||
Provision for impairment | ||||||
1.Opening balance | ||||||
2.Increase in current period | ||||||
(1)Including: Provision | ||||||
3.Decrease in current period | ||||||
(1)Including: Disposal | ||||||
4.Closing balance | ||||||
Book value of |
intangible assets
intangible assets | ||||||
Closing book value | 1,633,748,232.72 | 6,448,166.71 | 74,184,676.00 | 1,714,381,075.43 | ||
Opening book value | 1,589,393,595.02 | 8,695,184.81 | 81,509,153.23 | 1,679,597,933.06 |
The proportion of intangible assets formed through internal research and development of the Company inthe balance of intangible assets at the end of this period is 0.00%.
16. Goodwill
(1) Goodwill book value
Unit: CNY
Investee’s name or items resulting in goodwill | Opening balance | Increase in current period | Decrease in current period | Closing balance | ||
Business combination | Disposal | |||||
Jiangsu Shuanggou Distillery Stock Co., Ltd. | 276,001,989.95 | 276,001,989.95 | ||||
Jiangsu Zhaiugou E-commerce Co., Ltd | 6,940,018.79 | 6,940,018.79 | ||||
Jiangsu Zhaibianli E-commerce Co., Ltd | 21,250,284.80 | 21,250,284.80 | ||||
Guizhou Guijiu Co., Ltd. | 18,826,210.01 | 18,826,210.01 | ||||
ZYG TECHNOLOGY INVESTMENT LTD | 5,057,111.19 | 5,057,111.19 | ||||
Guizhou Maotaizhen Guijiu Liquor Industry Co., Ltd | 11,333,195.25 | 11,333,195.25 | ||||
Total | 339,408,809.99 | 339,408,809.99 |
(2) Goodwill impairment provision
Unit: CNY
Investee’s name or items resulting in goodwill | Opening balance | Increase in current period | Decrease incurrent period | Closing balance | ||
Provision | Disposal | |||||
Jiangsu Zhaiugou E-commerce Co., Ltd | 6,940,018.79 | 6,940,018.79 | ||||
Jiangsu Zhaibianli E-commerce Co., Ltd | 21,250,284.80 | 21,250,284.80 |
Guizhou Guijiu Co.,Ltd.
Guizhou Guijiu Co., Ltd. | 18,826,210.01 | 18,826,210.01 | ||||
ZYG TECHNOLOGY INVESTMENT LTD | 5,057,111.19 | 5,057,111.19 | ||||
Guizhou Maotaizhen Guijiu Liquor Industry Co., Ltd | 11,333,195.25 | 11,333,195.25 | ||||
Total | 63,406,820.04 | 63,406,820.04 |
Related information of asset groups or asset group portfolio containing goodwillThe recoverable amount of asset group containing apportioned goodwill is determined according to thepresent value of the estimated future cash flow of the relevant asset group. Its future cash flows aredetermined based on the 3-year financial budget, with a certain discount rate. Cash flow over 3 years iscalculated on the basis of19.04% growth rate. After the test, there is no goodwill impairment resulting fromthe acquisition of Jiangsu Shuanggou Distillery Stock Co., Ltd.Statement of testing process of impairment of goodwill, key parameters (e.g. the forecast growth rate atpresent value of future cash flows; the growth rate in stable period; profit margin; the discount rate; predictiveperiod and etc.) and determination methods of recognizing goodwill impairment loss.Effect of goodwill impairment testOther notes
17. Long-term prepaid expenses
Unit: CNY
Item | Opening balance | Increase in the current period | Amortization for the current period | Other decreases | Closing balance |
Wine city night view Identification project | 12,016,464.46 | 3,004,116.11 | 9,012,348.35 | ||
Brighten old factory and packaging logistics center project | 1,744,387.40 | 436,096.85 | 1,308,290.55 | ||
Decoration expenses of hotel | 2,343,827.82 | 585,956.96 | 1,757,870.86 | ||
Total | 16,104,679.68 | 4,026,169.92 | 12,078,509.76 |
18. Deferred tax assets/ deferred tax liabilities
(1) Deferred tax assets before offset
Unit: CNY
Item | Closing balance | Opening balance | ||
Deductible temporary differences | Deferred tax assets | Deductible temporary | Deferred tax assets |
differences
differences | ||||
Provision for asset impairment | 71,167,403.99 | 17,707,993.48 | 69,755,972.71 | 17,438,816.79 |
Unrealized profit from internal transaction | 49,441,159.83 | 12,360,289.96 | 57,053,878.39 | 14,263,469.60 |
Deductible losses | 1,005,233,098.74 | 251,308,274.69 | 1,005,233,098.74 | 251,308,274.69 |
The difference between book value of debt and tax base | 4,703,841,737.42 | 1,175,960,434.36 | 4,371,081,520.39 | 1,092,770,380.10 |
ESOP | 163,118,128.78 | 40,779,532.19 | 40,703,820.01 | 10,175,955.00 |
Total | 5,992,801,528.76 | 1,498,116,524.68 | 5,543,828,290.24 | 1,385,956,896.18 |
(2) Deferred tax assets or liabilities presented as net value after offset
Unit: CNY
Item | Offset amount of deferred tax assets and deferred tax liabilities | Closing balance Of deferred tax assets or deferred tax liabilities after offset | Opening offset amount of deferred tax assets and deferred tax liabilities | Opening balance Of deferred tax assets or deferred tax liabilities after offset |
Deferred tax assets | 1,498,116,524.68 | 1,385,956,896.18 | ||
Deferred tax liabilities | 219,046,405.35 | 299,382,397.38 |
(3) Details of unrecognized deferred tax assets
Unit: CNY
Item | Closing balance | Opening balance |
Deductible temporary differences | 180,135,943.91 | 192,033,907.02 |
Deductible losses | 265,285,228.80 | 56,117,773.36 |
Total | 445,421,172.71 | 248,151,680.38 |
(4)Deductible losses from unrecognized deferred tax assets will due on the following years
Unit: CNY
Year | Closing balance | Opening balance | Note |
2023年 | 3,336,993.92 | 3,336,993.92 | |
2024年 | 1,070,547.10 | 5,217,042.38 | |
2025年 | 13,861,118.62 | 13,861,118.62 | |
2026年 | 33,702,618.44 | 33,702,618.44 | |
2027年 | 213,313,950.72 | ||
Total | 265,285,228.80 | 56,117,773.36 |
19. Other non-current assets
Unit: CNY
Item | Closing balance | Opening balance | ||||
Book Balance | Provision for impairment | Book value | Book Balance | Provision for impairment | Book value | |
Compensation for land | 158,606,824.94 | 158,606,824.94 | 158,606,824.94 | 158,606,824.94 |
demolition
demolition | ||||||
Prepayment of construction equipment and house purchase | 25,240,376.90 | 25,240,376.90 | 27,533,814.44 | 27,533,814.44 | ||
Total | 183,847,201.84 | 183,847,201.84 | 186,140,639.38 | 186,140,639.38 |
20. Notes Payable
Unit: CNY
Item | Closing balance | Opening balance |
Bank acceptance Bill | 30,000,000.00 | |
Total | 30,000,000.00 |
As of December 31st 2023, the company did not have any unpaid matured notes payable.
21. Accounts payables
(1) Presentation of accounts payables
Unit: CNY
Item | Closing balance | Opening balance |
Payments for goods | 1,305,100,314.00 | 1,364,515,734.82 |
Payables on equipment | 71,109,213.01 | 79,659,527.26 |
Total | 1,376,209,527.01 | 1,444,175,262.08 |
(2) Significant accounts payables aging over one year
No significant accounts payables aging over 1 year are recorded in the ending balance.
22. Contract liabilities
Unit: CNY
Item | Closing balance | Opening balance |
Advance from customers | 9,296,856,026.01 | 11,645,306,829.55 |
Discounts and allowances payable to the distributors that have not yet been settled | 4,444,691,651.98 | 4,159,214,600.62 |
Total | 13,741,547,677.99 | 15,804,521,430.17 |
The company is required to comply with the disclosure requirements of the food and alcohol manufacturingrelated industries in the "Shenzhen Stock Exchange Listed Companies Self Regulatory Guidelines No. 3-Industry Information Disclosure"
23. Employee benefits payable
(1) Employee benefits payable shown as follows:
Unit: CNY
Item | Opening balance | Increase in current | Decrease in current | Closing balance |
period
period | period | |||
Short-term benefits | 536,524,921.85 | 3,157,749,362.07 | 3,211,935,603.97 | 482,338,679.95 |
Post-employment benefits-defined contribution plans | 192,207.31 | 232,881,595.55 | 232,420,744.08 | 653,058.78 |
Total | 536,717,129.16 | 3,390,630,957.62 | 3,444,356,348.05 | 482,991,738.73 |
(2) Short-term employee benefits payable shown as follows:
Unit: CNY
Item | Opening balance | Increase in current period | Decrease in current period | Closing balance |
Wages, bonuses, allowances and grants | 536,383,317.12 | 2,801,055,303.36 | 2,856,412,693.81 | 481,025,926.67 |
Employees’ welfare | 82,968,887.25 | 82,968,887.25 | ||
Social insurance premiums | 14,860.09 | 117,905,709.41 | 117,572,187.30 | 348,382.20 |
Including: Medical Insurance | 7,972.00 | 96,522,095.92 | 96,248,957.60 | 281,110.32 |
Work-related injury insurance | 6,875.34 | 8,051,429.18 | 8,030,613.51 | 27,691.01 |
Maternity insurance premium | 12.75 | 13,332,184.31 | 13,292,616.19 | 39,580.87 |
Housing funds | 120,629.80 | 147,250,554.12 | 146,421,363.92 | 949,820.00 |
Labor union expenditures and employee education funds | 6,114.84 | 8,568,907.93 | 8,560,471.69 | 14,551.08 |
Total | 536,524,921.85 | 3,157,749,362.07 | 3,211,935,603.97 | 482,338,679.95 |
(3) Defined Contribution Plan shown as follows:
Unit: CNY
Item | Opening balance | Increase in current period | Decrease in current period | Closing balance |
Basic endowment insurance premium | 191,323.23 | 226,075,159.48 | 225,633,229.48 | 633,253.23 |
Unemployment insurance premium | 884.08 | 6,806,436.07 | 6,787,514.60 | 19,805.55 |
Total | 192,207.31 | 232,881,595.55 | 232,420,744.08 | 653,058.78 |
24. Taxes payable
Unit: CNY
Item | Closing balance | Opening balance |
Value-added tax | 234,202,860.34 | 175,920,362.08 |
Consumption tax
Consumption tax | 229,128,457.84 | 554,560,829.94 |
Enterprise income tax | 563,184,112.71 | 2,200,631,701.75 |
Individual Income Tax | 46,912,680.60 | 30,310,775.71 |
Urban maintenance and construction tax | 19,917,118.57 | 26,222,879.17 |
Land use tax | 15,177,169.95 | 23,861,228.61 |
Property tax | 4,438,533.76 | 6,464,914.93 |
Education Surcharge and Local Education Surcharge | 19,421,778.51 | 39,516,421.27 |
Stamp tax | 1,827,899.05 | 1,556,153.30 |
Integrated funds | 532.45 | 6,505.75 |
Other tax | 2,484,661.40 | 2,333,399.20 |
Total | 1,136,695,805.18 | 3,061,385,171.71 |
25. Other payables
Unit: CNY
Item | Closing balance | Opening balance |
Other payables | 1,854,922,517.23 | 1,808,838,882.26 |
Total | 1,854,922,517.23 | 1,808,838,882.26 |
(1) Other payables
a) Categories by nature
Unit: CNY
Item | Closing balance | Opening balance |
Dealer deposit | 416,896,278.21 | 538,078,762.11 |
Dealer risk pledged deposit | 672,664,279.37 | 685,270,708.36 |
Accrued expenses | 508,608,287.32 | 351,345,770.61 |
Quality guarantee deposit and performance deposit | 166,220,885.21 | 131,196,540.43 |
Other payables | 90,532,787.12 | 102,947,100.75 |
Total | 1,854,922,517.23 | 1,808,838,882.26 |
b) Other important payables aging more than 1 year
Unit: CNY
Item | Closing balance | Reasons for being unpaid or written-off |
Dealer risk pledged deposit and dealer deposit | 611,870,057.78 | Dealer risk pledged deposit and dealer deposit not yet due |
Total | 611,870,057.78 |
26. Non-current Liabilities Due within One Year
Unit: CNY
Item | Closing balance | Opening balance |
Lease liabilities due within one year | 23,684,406.75 | 8,405,846.77 |
Total | 23,684,406.75 | 8,405,846.77 |
27. Other current liabilities
Unit: CNY
Item | Closing balance | Opening balance |
Output VAT to be transferred | 889,853,420.31 | 1,491,462,609.44 |
Notes endorsed but not derecognized | 422,394,730.00 | 547,802,328.28 |
Total | 1,312,248,150.31 | 2,039,264,937.72 |
28. Long-term loans
(1) Long-term loans by category
Unit: CNY
Item | Closing balance | Opening balance |
Credit loans | 36,360.00 | |
Total | 36,360.00 |
29. Lease Liabilities
Unit: CNY
Item | Closing balance | Opening balance |
Lease liabilities | 3,715,300.93 | 10,729,824.19 |
Total | 3,715,300.93 | 10,729,824.19 |
30. Long-term payables
Unit: CNY
Item | Closing balance | Opening balance |
Special accounts payables | 196,459,834.53 | 196,694,194.53 |
Total | 196,459,834.53 | 196,694,194.53 |
(1) Special accounts payables
Unit: CNY
Item | Opening balance | Increase in current period | Decrease in current period | Closing balance | Reason |
Compensation for replacement of employee status | 196,694,194.53 | 234,360.00 | 196,459,834.53 | ||
Total | 196,694,194.53 | 234,360.00 | 196,459,834.53 |
31. Deferred incomes
Unit: CNY
Item | Opening balance | Increase in current period | Decrease in current period | Closing balance | Reason |
Government grants | 77,242,500.00 | 24,000,000.00 | 8,965,333.33 | 92,277,166.67 | |
Total | 77,242,500.00 | 24,000,000.00 | 8,965,333.33 | 92,277,166.67 | -- |
Projects involving government grants:
Unit: CNY
Liability item | Opening balance | Increase in current period | Non-operating income in current period | Other income in current period | Cost reduction in current period | Other changes | Closing balance | Relevant to asset or income |
Hubei Lihuacun liquor industry liquor brewing, filling project supporting facilities construction subsidies | 17,539,600.00 | 4,257,000.00 | 13,282,600.00 | Asset | ||||
Special fund for packaging logistics project in Shuanggou new area | 9,000,000.00 | 3,000,000.00 | 6,000,000.00 | Asset | ||||
Special fund for Harbin Binzhou Distillery construction project | 41,202,900.00 | 41,202,900.00 | Asset | |||||
Shuanggou sewage treatment project | 4,500,000.00 | 1,500,000.00 | 3,000,000.00 | Asset | ||||
The second batch of provincial- level industrial and information industry transformation and upgrading special funds in 2020 | 5,000,000.00 | 208,333.33 | 4,791,666.67 | Asset | ||||
Supplementary funds for the Shuanggou Pottery Tan Warehouse project | 24,000,000.00 | 24,000,000.00 | Asset | |||||
Total | 77,242,500.00 | 24,000,000.00 | 8,965,333.33 | 92,277,166.67 |
32. Share capital
Unit: CNY
Opening balance | Increases/decreases in the current period (+, -) | Closing balance | |||||
Issuance of new shares | Share donation | Conversion of reserves funds into shares | Others | Subtotal | |||
Total shares | 1,506,988,000.00 | 1,506,988,000.00 |
33.Capital reserves
Unit: CNY
Item | Opening balance | Increase in current period | Decrease in current period | Closing balance |
Share premium | 741,502,550.13 | 741,502,550.13 | ||
Other capital reserves | 40,733,820.01 | 122,414,308.77 | 163,148,128.78 | |
Total | 782,236,370.14 | 122,414,308.77 | 904,650,678.91 |
The company confirms the ESOP plan fee to increase the capital reserves-other capital reserves of RMB122,414,308.77.
34. Treasury shares
Unit: CNY
Item | Opening balance | Increase in current period | Decrease in current period | Closing balance |
Share repurchase | 56,278,680.79 | 56,278,680.79 | ||
Total | 56,278,680.79 | 56,278,680.79 |
35. Other comprehensive incomes
Unit: CNY
Item | Opening balance | Current period | Closing balance | |||||
Amount in current period before income tax | Less: Previously recognized in other comprehensive income transferred to profit or loss | Less: previously recognized in other comprehensive income transferred to retained earnings | Less: income tax | Amount attribute to parent company after tax | Amount attribute to non-controlling shareholders after tax | |||
II. Other comprehensive income that will be reclassified to profit or loss | -5,843,990.29 | 7,707,584.12 | -153,503.58 | 7,825,669.24 | 35,418.46 | 1,981,678.95 | ||
Including: other comprehensive income will be reclassified into profits or losses under the equity method | -153,503.58 | -153,503.58 | 153,503.58 | |||||
Effect on conversion of financial statements denominated in foreign currencies | -5,690,486.71 | 7,707,584.12 | 7,672,165.66 | 35,418.46 | 1,981,678.95 | |||
Total other comprehensive income | -5,843,990.29 | 7,707,584.12 | -153,503.58 | 7,825,669.24 | 35,418.46 | 1,981,678.95 |
Other notes, including adjustments for valid portion of the gains and or losses from cash flow hedging transferring to initial recognition amount of projects hedged.
36. Surplus reserves
Unit: CNY
Item | Opening balance | Increase in current period | Decrease in current period | Closing balance |
Statutory surplus reserves | 753,494,000.00 | 753,494,000.00 | ||
Total | 753,494,000.00 | 753,494,000.00 |
37. Retained Earnings
Unit: CNY
Item | Current period | Previous period |
Retained Earnings before adjustment at the end of the last year | 39,505,614,090.53 | 36,489,911,363.13 |
Retained Earnings after adjustment at the beginning of year | 39,505,614,090.53 | 36,489,911,363.13 |
Add: net profit attributable to owners of the parent company for the current period | 9,377,832,429.08 | 7,507,682,797.40 |
Less: Dividends payable on common shares | 4,519,335,222.00 | 4,491,980,070.00 |
Retained earnings at the end of the current reporting period | 44,364,111,297.61 | 39,505,614,090.53 |
Notes for adjusting undistributed profits at the beginning of the period:
(1) Retained Earnings at the beginning of the period were affected by CNY0.00 due to the retrospectiveadjustment under the Accounting Standards for Business Enterprises and related new regulations.
(2) Retained Earnings at the beginning of the period were affected by CNY0.00 due to changes in accountingpolicies.
(3) Undistributed profits at the beginning of the period were affected by CNY0.00 due to the correction ofsignificant accounting errors.
(4) Retained Earnings s at the beginning of the period were affected by CNY0.00 due to changes in the scope ofconsolidation resulting from business combination involving enterprises under common control.
(5) Retained Earnings at the beginning of the period were affected by CNY0.00B in total due to otheradjustments
38. Operating revenue and cost of sales
Unit: CNY
Item | Current period amount | Previous period amount | ||
Operating revenue | Cost of sales | Operating revenue | Cost of sales | |
Operating incomes | 29,499,863,067.64 | 7,214,917,301.54 | 24,638,674,089.57 | 5,702,863,048.47 |
Other operating income | 605,033,119.06 | 430,615,963.18 | 711,504,114.88 | 552,534,515.63 |
Total | 30,104,896,186.70 | 7,645,533,264.72 | 25,350,178,204.45 | 6,255,397,564.10 |
Whether the net profit is negative or not after deducting non-recurring profits and losses by audit,
□ Yes √ No
Information on revenue:
Unit: CNY
Category of Contra | Segment 1 | Segment 2 | Current period amount | Total |
Commodity type | ||||
Including: | ||||
liquor | 29,499,863,067.64 | 29,499,863,067.64 | ||
Other | 605,033,119.06 | 605,033,119.06 | ||
By operating regions | ||||
Including: | ||||
Type of market or customer | ||||
Including: | ||||
Type of contract | ||||
Including: | ||||
By the time of commodity transfer | ||||
Including: | ||||
By the contract time | ||||
Including: | ||||
By the selling channel | ||||
Including: | ||||
Total | 30,104,896,186.70 | 30,104,896,186.70 |
Information regarding performance obligationsN/AInformation relating to the transaction price apportioned to the remaining performance obligations:
At the end of this report, the amount of revenue corresponding to the performance obligations with thecontracts signed but not performed or not performed is CNY 9,296,856,026.01, of which CNY 9,296,856,026.01is expected to be recognized in 2023, and CNY 0.00 is expected to be recognized in 2024.
39. Taxes and surcharges
Unit: CNY
Item | Current period amount | Previous period amount |
Consumption tax | 3,611,101,428.65 | 3,445,365,868.93 |
Urban maintenance and construction tax | 340,401,921.12 | 300,870,065.44 |
Educational surcharge | 337,972,048.98 | 298,966,722.11 |
Property tax | 65,064,008.57 | 70,430,075.52 |
Land use tax | 18,379,939.08 | 18,361,571.79 |
Vehicle and vessel tax | 8,875.20 | 8,508.00 |
Stamp tax
Stamp tax | 14,303,404.79 | 13,969,946.24 |
Environmental protection tax | 1,080,778.49 | 9,370.09 |
Total | 4,388,312,404.88 | 4,147,982,128.12 |
40. Selling and distribution expenses
Unit: CNY
Item | Current period amount | Previous period amount |
Advertising and promotion expense | 2,414,204,544.39 | 1,911,827,032.90 |
Payroll | 1,177,066,920.45 | 1,065,844,674.57 |
Travel expense | 433,273,104.21 | 390,432,690.88 |
Labor expense | 47,961,453.63 | 88,722,961.18 |
E-commerce expenses | 33,851,096.47 | 37,801,331.20 |
Other expense | 72,783,688.70 | 49,736,198.81 |
Total | 4,179,140,807.85 | 3,544,364,889.54 |
41. General and administrative expenses
Unit: CNY
Item | Current period amount | Previous period amount |
Payroll | 774,749,241.22 | 738,382,078.49 |
Travel expense | 14,520,700.63 | 35,607,123.11 |
Office allowance | 7,460,258.87 | 7,389,752.82 |
Water, electric and steam expense | 66,592,027.85 | 57,175,472.37 |
Business entertainment expense | 21,636,429.90 | 25,674,580.41 |
Depreciation cost | 422,769,117.64 | 430,504,129.04 |
Repair charge | 39,597,394.14 | 43,706,934.03 |
Amortization of intangible assets | 58,879,062.62 | 56,541,702.98 |
Vehicle use expense | 19,074,484.31 | 21,827,557.47 |
Shipping and handling cost | 25,978,095.37 | 31,039,417.23 |
ESOP plan fee | 119,528,186.15 | 39,741,779.13 |
Other expense | 364,888,297.05 | 342,489,612.10 |
Total | 1,935,673,295.75 | 1,830,080,139.18 |
42. Research & Development expenses
Unit: CNY
Item | Current period amount | Previous period amount |
Material expenses | 121,940,738.99 | 126,609,051.53 |
Payroll | 84,197,126.24 | 84,819,165.34 |
Other expense | 47,437,111.16 | 47,029,885.76 |
Total | 253,574,976.39 | 258,458,102.63 |
43. Financial expenses
Unit: CNY
Item
Item | Current period amount | Previous period amount |
Interest expense | 694,325.50 | 603,755.58 |
Bill discount expense | 5,887,512.78 | 28,742,496.43 |
Less: Interest income | 645,806,427.40 | 433,923,395.67 |
Plus: Losses from currency exchange (Less: income) | 336,446.78 | 3,194,795.97 |
Plus: Bank charges | 2,418,036.43 | 2,236,837.73 |
Total | -636,470,105.91 | -399,145,509.96 |
44. Other income
Unit: CNY
Sources of other income | Current period amount | Previous period amount |
Government grants received | 60,162,525.57 | 87,366,302.47 |
Withholding personal tax commission | 3,610,292.93 | 3,484,445.51 |
Total | 63,772,818.50 | 90,850,747.98 |
45. Investment income
Unit: CNY
Item | Current period amount | Previous period amount |
Investment income from long-term equity investments under the equity method | 5,201,436.79 | 2,948,720.95 |
Investment income from disposing long- term equity investments | -1,052,106.17 | |
Investment income from financial assets held for trading during the holding period | 39,061,870.99 | 23,102,480.38 |
Investment income from disposal of financial assets held for trading | 396,238,455.03 | 874,562,276.89 |
Income from derecognition of financial assets measured at amortized cost | -13,584,025.11 | |
Total | 425,865,631.53 | 900,613,478.22 |
46. Gains/losses of changes in fair value
Unit: CNY
Gains/losses of changes in fair value | Current period amount | Previous period amount |
Held-for-trading financial assets | -318,331,123.43 | -721,212,806.81 |
Total | -318,331,123.43 | -721,212,806.81 |
47. Credit Impairment Loss
Unit: CNY
Item | Current period amount | Previous period amount |
Credit impairment losses of other receivables | 819,879.51 | 12,801,955.01 |
Credit impairment losses of accounts receivables | -1,565,965.47 | -174,467.73 |
Total | -746,085.96 | 12,627,487.28 |
48. Losses from asset impairment
Unit: CNY
Item | Current period amount | Previous period amount |
Losses on inventory devaluation and Contract assets impairment loss | -2,333,823.54 | -7,175,293.45 |
Total | -2,333,823.54 | -7,175,293.45 |
49. Gains from disposal of assets
Unit: CNY
Gains from disposal of assets | Current period amount | Previous period amount |
Gains from disposal of fixed assets | 1,846,300.27 | 224,432.51 |
Gains from disposal of intangible assets | -39,747.54 | |
Total | 1,846,300.27 | 184,684.97 |
50. Non-operating income
Unit: CNY
Item | Current period amount | Previous period amount | Amount included in non-recurring profit and loss in current period |
Liquidated damages income | 6,966,329.61 | 7,192,792.01 | 6,966,329.61 |
Compensation payment | 10,662,216.44 | 11,339,388.88 | 10,662,216.44 |
Account payables that are unable to pay | 3,463,801.85 | 20,610.00 | 3,463,801.85 |
Others | 4,493,984.81 | 2,165,592.11 | 4,493,984.81 |
Total | 25,586,332.71 | 20,718,383.00 | 25,586,332.71 |
51. Non-operating expenses
Unit: CNY
Item | Current period amount | Previous period amount | Amount included in non-recurring profit and loss in current period |
Donation expenses | 12,401,802.24 | 42,083,802.00 | 12,401,802.24 |
Losses from disposal of fixed asset | 6,682,103.85 | 10,872,590.73 | 6,682,103.85 |
Integrated fund | 66,741.89 | 72,950.74 | |
Reparations | 15,537.00 | 3,971,839.00 | 15,537.00 |
Others | 12,341,516.75 | 6,218,870.88 | 12,341,516.75 |
Total | 31,507,701.73 | 63,220,053.35 | 31,440,959.84 |
52. Income tax expense
(1) Details of income tax expense
Unit: CNY
Item
Item | Current period amount | Previous period amount |
Income tax for the current reporting period | 3,306,448,635.67 | 3,050,593,837.76 |
Deferred income tax expenses | -192,562,915.79 | -616,983,716.56 |
Total | 3,113,885,719.88 | 2,433,610,121.20 |
(2) Adjustment for accounting profit and income tax expense
Unit: CNY
Item | Current period amount |
Total profit | 12,503,283,891.37 |
Income tax expenses determined by statutory/applicable tax rate | 3,125,820,972.84 |
Impact from subsidiaries’ different tax rates | 1,392,608.98 |
Adjust for impact from income tax expense in previous period | -9,380,792.40 |
Tax effect of non-taxable income | -6,287,068.37 |
Impact of non-deductible costs, expenses and losses | 9,779,208.84 |
Deductible from deferred tax assets in previous period | -1,036,623.82 |
Impact of deductible temporary differences or deductible losses for which no deferred income tax assets is recognized for the current period | 52,758,055.68 |
Impact of use unrecognized deferred income tax assets in the prior period | -943,743.09 |
Impact of additional deduction of R&D expenses | -62,107,915.85 |
Other | 3,891,017.07 |
Income tax expense | 3,113,885,719.88 |
53. Net other comprehensive income
Refer to note for details.
54. Consolidated cash flow items
(1) Cash received from other operation activities
Unit: CNY
Item | Current period amount | Previous period amount |
Interest income | 398,200,995.54 | 325,095,935.92 |
Liquidated damages income | 6,966,329.61 | 7,192,792.01 |
Government grants | 75,197,192.24 | 78,609,302.47 |
Charges of withholding individual income tax | 3,610,292.93 | 3,484,445.51 |
Others | 66,782,450.92 | 314,046,435.75 |
Total | 550,757,261.24 | 728,428,911.66 |
(2) Cash paid for other operating activities
Unit: CNY
Item | Current period amount | Previous period amount |
Transportation fee | 28,032,045.07 | 32,454,361.50 |
Advertising promotion expense | 2,243,614,041.05 | 1,875,126,011.49 |
Repair charge | 39,389,355.92 | 40,144,581.28 |
Travel expense | 435,008,309.39 | 431,546,399.27 |
Entertainment expense | 23,994,929.18 | 25,897,841.15 |
Labor expense | 91,759,676.26 | 135,250,366.93 |
Others | 606,935,645.43 | 462,537,339.25 |
Total | 3,468,734,002.30 | 3,002,956,900.87 |
(3) Cash received from other financing activities
Unit: CNY
Item | Current period amount | Previous period amount |
Repurchase of ESOP shares | 945,850,000.00 | |
Total | 945,850,000.00 |
(4) Cash paid for other financing activities
Unit: CNY
Item | Current period amount | Previous period amount |
Lease payment | 15,204,742.60 | 6,587,740.77 |
Total | 15,204,742.60 | 6,587,740.77 |
55. Supplementary Information about Cash Flow Statement
(1) Supplementary information about of cash flow statement
Unit: CNY
Item | Current period amount | Previous period amount |
Reconciliation of net profit to cash flow from operating activities | ||
Net profit | 9,389,398,171.49 | 7,512,817,397.48 |
Add: Impairment of assets | 3,079,909.50 | -5,452,193.83 |
Fixed assets depreciation | 678,868,349.45 | 693,049,497.12 |
Right-of-use assets depreciation | 11,177,822.64 | 5,509,542.40 |
Amortization of intangible assets | 58,842,693.52 | 56,541,702.98 |
Amortization of long-term deferred expenses | 4,026,169.92 | 4,153,241.68 |
Gains on disposal of fixed assets, intangible assets and other long-term assets | -1,846,300.27 | -184,684.97 |
Fixed asset scrapping losses | 6,682,103.85 | 10,872,590.73 |
Losses (gains) from changes in fair value | 318,331,123.43 | 721,212,806.81 |
Financial expense | 1,030,772.28 | 3,798,551.55 |
Investments income
Investments income | -425,865,631.53 | -900,613,478.22 |
Decrease in deferred tax asset | -112,159,628.50 | -460,035,492.67 |
Increase in deferred tax liabilities | -80,335,992.03 | -156,957,017.00 |
Decrease in inventory | -922,733,979.02 | -1,956,133,735.33 |
Decrease in operation receivables | -371,555,344.91 | -230,907,969.63 |
Increase in operation payables | -4,789,890,533.79 | 10,090,059,214.80 |
Others | -119,425,753.84 | -69,564,493.37 |
Net cash flow from operating activities | 3,647,623,952.19 | 15,318,165,480.53 |
Significant investing and financing activities not Involving cash flow: | ||
Conversion of debt into capital | ||
Convertible corporate bonds maturing within one year | ||
Assets under leases | ||
Net change in cash &cash equivalents | ||
Closing balance of cash | 24,019,016,540.72 | 20,847,003,550.37 |
Less: Opening balance of cash | 20,847,003,550.37 | 7,243,186,362.29 |
Add: Closing balance of cash equivalents | ||
Less: Opening balance of cash equivalents | ||
Net Increase (decrease) in cash and cash equivalents | 3,172,012,990.35 | 13,603,817,188.08 |
(2) Composition of cash and cash equivalents
Unit: CNY
Item | Closing balance | Opening balance |
Cash | 24,019,016,540.72 | 20,847,003,550.37 |
Including: cash on hand | 3,549.27 | |
Unrestricted bank deposit | 23,974,964,633.03 | 20,785,927,709.41 |
Cash equivalents | 44,051,907.69 | 61,072,291.69 |
Closing balance of cash and cash Equivalents | 24,019,016,540.72 | 20,847,003,550.37 |
56. Foreign currency transactions
(1) Foreign currency balance
Unit: CNY
Item | Balance in foreign currency at the end of the reporting period | Exchange rate | Balance of CNY converted at the end of the reporting period |
Cash and cash equivalents | |||
Including :USD | 2,325,513.37 | 6.9646 | 16,196,270.44 |
EUR | |||
HKD | 11,621,517.91 | 0.8933 | 10,381,501.95 |
CLP | 471,084,627.00 | 0.008131 | 3,830,608.28 |
Accounts receivables
Accounts receivables | |||
Including :USD | |||
EUR | |||
HKD | |||
Long-term loans | |||
Including :USD | |||
EUR | |||
HKD | |||
(2) Description of the overseas business entity, including the important foreign business entity, whichshall disclose its main foreign business place, bookkeeping standard currency and selection basis, and shallalso disclose the reason for the change of the bookkeeping standard currency.?Applicable □N/A
Foreign business entities | Operation site | Functional currency | Choosing reason |
JSSJ Industry (HK) Holdings Co., Limited | Hong Kong, China | HKD | Currency in the main economic environment of business operations |
Hong Kong Zhaiugo International Trade Co., Ltd. | Hong Kong, China | HKD | Currency in the main economic environment of business operations |
ZYG E-Commerce HK Limited | Hong Kong, China | HKD | Currency in the main economic environment of business operations |
ZYG LTD | Cayman Islands | USD | Currency in the main economic environment of business operations |
YangHe International Investment Ltd | British Virgin Islands | USD | Currency in the main economic environment of business operations |
ZYG TECHNOLOGY INVESTMENT LTD | British Virgin Islands | USD | Currency in the main economic environment of business operations |
YANGHE CHILE SPA | Santiago, Chile | CLP | Currency in the main economic environment of business operations |
Yanghe Hong Kong Distillery Co., Ltd. | Hong Kong, China | HKD | Currency in the main economic environment of business operations |
57.Government grants
(1) Details of government grants
Unit: CNY
Category | Amount | Financial Report Items | Amount booked in current profit and loss |
Industrial development guidance funds | 30,095,665.00 | Other income | 30,095,665.00 |
Steady post subsidy | 11,025,458.27 | Other income | 11,025,458.27 |
training subsidy | 1,548,650.00 | Other income | 1,548,650.00 |
Reward funds for local financial and economic contribution | 1,286,600.00 | Other income | 1,286,600.00 |
Funding for the 2021 Provincial Industrial and Information Technology Industry Transformation Project of Sihong County Finance Bureau | 1,000,000.00 | Other income | 1,000,000.00 |
Sihong County Finance Bureau Treasury Jiangsu Province Intellectual Property Industrial Trademark Cultivation Award | 1,000,000.00 | Other income | 1,000,000.00 |
2021 Provincial Innovation Capacity Construction Special Fund | 800,000.00 | Other income | 800,000.00 |
Funding for the construction of the liquor capital | 750,000.00 | Other income | 750,000.00 |
Yanghe Xinqu 2017 and 2018 Coal Reduction Work Award and Supplementary Funds | 738,000.00 | Other income | 738,000.00 |
2022 National Intangible Cultural Heritage Protection Special Fund | 539,100.00 | Other income | 539,100.00 |
Special Fund for Tourism Development of Sihong County Bureau of Culture, Radio, and Television | 500,000.00 | Other income | 500,000.00 |
Park rent subsidy | 436,644.87 | Other income | 436,644.87 |
Incentive funds for the 2021 Sihong County Industrial Conference of the State Treasury of Sihong County Finance Bureau | 300,000.00 | Other income | 300,000.00 |
Funding for Municipal Science and Technology Plan Projects in 2022 | 300,000.00 | Other income | 300,000.00 |
2021 New-Add provincial-level reward funds for industrial enterprises above designated size | 200,000.00 | Other income | 200,000.00 |
2021 Science and Technology Innovation Award | 120,000.00 | Other income | 120,000.00 |
Others | 557,074.10 | Other income | 557,074.10 |
Transfer of current deferred earnings | 8,965,333.33 | Other income | 8,965,333.33 |
Total | 60,162,525.57 | 60,162,525.57 |
VIII. Changes in consolidated scope
1. Changes of Consolidation Scope due to Other Causes
Explain the change of merger scope caused by other reasons (such as new subsidiary, liquidationsubsidiary, etc.) and the relevant situation
2. Establishing subsidiaries
(1) In March 2022, the company jointly invested 40 million yuan with Tibet Earth Third Pole IndustryDevelopment Co., Ltd., Lhasa Pure Land Industry Investment and Development Group Co., Ltd., and ShenzhenBaoneng Food Technology Group Co., Ltd. to establish Tibet Earth Third Pole Liquor Industry Co., Ltd. Thecompany contributed 204 million yuan, accounting for 51% of its registered capital; Tibet Earth Third PoleIndustrial Development Co., Ltd. invested 72 million yuan, accounting for 18% of its registered capital; LhasaPure Land Industry Investment and Development Group Co., Ltd. invested 64 million yuan, accounting for 16% ofits registered capital; Shenzhen Baoneng Food Technology Group Co., Ltd. has invested 60 million yuan,accounting for 15% of its registered capital. It will be included in the consolidation scope of the consolidatedfinancial statements starting from March 2022.
(2) In August 2022, the holding subsidiary Kweichow Moutai Guijiu Liquor Industry Co., Ltd. invested 500000yuan to establish Guizhou Guijiu Liquor Industry Operation Co., Ltd., accounting for 100% of its registered capital.It will be included in the consolidation scope of the consolidated financial statements starting from August 2022.
(3) In August 2022, the company subscribed 10 million yuan to establish Jiangsu Ulan Shangyin CateringManagement Co., Ltd., accounting for 100% of its registered capital. It will be included in the consolidation scopeof the consolidated financial statements starting from August 2022.
(4) In August 2022, the company subscribed a capital of 300 million yuan and established Jiangsu YangheDream Investment Management Co., Ltd., accounting for 100% of its registered capital. It will be included in theconsolidation scope of the consolidated financial statements starting from August 2022.
(5) In September 2022, the controlling subsidiary Jiangsu Yanghe Dream Investment Management Co., Ltd.invested 10 million yuan to establish Jiangsu Yanghe Blue Investment Management Co., Ltd., accounting for
100.00% of its registered capital. It will be included in the consolidation scope of the consolidated financialstatements starting from September 2022.
3. Cancellation of subsidiaries
(1) In September 2022, holding subsidiary Jiangsu Kelite Biotechnology Research Institute Co., Ltd cancelledin the current reporting period and no longer included in the scope of consolidation from October 2022.
(2) In November 2022, holding subsidiary Guizhou Guijiu Liquor Operations Management Co., Ltd cancelledin the current reporting period and no longer included in the scope of consolidation from December 2022.
IX. Interests in other entities
1. Interests in subsidiaries
(1) Group composition:
Name of subsidiaries | Major business location | Place of registration | Nature of business | Shareholding | Acquisition method | |
Direct | Indirect | |||||
Nanjing Yanghe Blue Classic Co., Ltd | Nanjing, Jiangsu province | Nanjing, Jiangsu province | Commerce | 100.00% | Establishment | |
Beijing Yanghe Commerce and Trade Co., Ltd. | Fengtai, Beijing | Fengtai, Beijing | Commerce | 100.00% | Establishment | |
Jiangsu Huaqu Wine Group Co., Ltd. | Nanjing, Jiangsu province | Nanjing, Jiangsu province | Commerce | 97.00% | Establishment | |
Suqian Tianhai Commerce and Trade Co., Ltd. | Suqian, Jiangsu province | Suqian, Jiangsu province | Commerce | 100.00% | Establishment | |
Suqian Yanghe Guibinguan Co., Ltd. | Suqian, Jiangsu province | Suqian, Jiangsu province | Hotel industry | 100.00% | Establishment | |
Su Wine Group Trade Co., Ltd | Suqian, Jiangsu province | Suqian, Jiangsu province | Commerce | 83.63% | 16.37% | Establishment |
Jiangsu Yanghe Liquor Operation Management Co., Ltd. | Suqian, Jiangsu province | Suqian, Jiangsu province | Commerce | 100.00% | Establishment | |
Jiangsu Shuanggou Liquor Operation Co., Ltd. | Sihong, Jiangsu province | Sihong, Jiangsu province | Commerce | 100.00% | Establishment | |
Jiangsu Dongdi Union International Trade Co., Ltd. | Suqian, Jiangsu province | Suqian, Jiangsu province | Commerce | 100.00% | Establishment | |
Jiangsu Dongdixinghui International Trade Co., Ltd. | Suqian, Jiangsu province | Suqian, Jiangsu province | Commerce | 100.00% | Establishment | |
Suqian Blue Dream Trade Co., Ltd. | Suqian, Jiangsu province | Suqian, Jiangsu province | Commerce | 100.00% | Establishment | |
Siyang Lantu Liquor Operation Co., Ltd. | Siyang, Jiangsu | Siyang, Jiangsu province | Commerce | 100.00% | Establishment |
province
province | ||||||
JSSJ Industry (HK) Holdings Co., Limited | Hong Kong, China | Hong Kong,China | CORP | 100.00% | Establishment | |
Hubei Lihuacun Trade Co., Ltd. | Shiyan, Hubei province | Yunxian, Hubei province | Commerce | 100.00% | Establishment | |
Jiangsu Shuanggou Distillery Stock Co., Ltd. | Sihong, Jiangsu province | Sihong, Jiangsu province | Liquor manufacture and sales | 99.99% | 0.01% | Business combinations involving enterprises not under common control |
Sihong Shuanggou Antai Waste Recycling Co., Ltd. | Sihong, Jiangsu province | Sihong, Jiangsu province | Waste material recycle | 100.00% | Business combinations involving enterprises not under common control | |
Hubei Lihuacun Liquor Industry Co., Ltd. | Shiyan, Hubei province | Yunxian, Hubei province | Process liquor, wine and fruit wine | 100.00% | Business combinations involving enterprises not under common control | |
Ningxiang Miluochun Liquor Industry Co., Ltd. | Ningxiang, Hunan province | Ningxiang, Hunan province | Manufacture and sale of liquor and compound wine | 100.00% | Business combinations involving enterprises not under common control | |
Harbin Binzhou Distillery Co., Ltd. | Binxian, Heilongjiang province | Binxian, Heilongjiang province | Liquor-making | 100.00% | Business combinations involving enterprises not under common control | |
Su Wine Group Jiangsu Wealth Management Co., Ltd. | Nanjing, Jiangsu province | Nanjing, Jiangsu province | Assets/investment management, information consultation | 100.00% | Establishment | |
Ningxiang Miluochun Trade Co., Ltd. | Ningxiang, Hunan province | Ningxiang, Hunan province | Commerce | 100.00% | Establishment | |
Suqian Blue Sky Trade Co., Ltd. | Suqian, Jiangsu province | Suqian, Jiangsu province | Commerce | 100.00% | Establishment | |
Shiyan Yunyang Lihuacun Package Service Co.,Ltd. | Shiyan, Hubei province | Shiyan, Hubei province | Liquor, compound wine, health wine packaging service | 100.00% | Establishment |
Jiangsu Lion andSheep NetworkTechnology Co.,Ltd.
Jiangsu Lion and Sheep Network Technology Co.,Ltd. | Nanjing, Jiangsu province | Nanjing, Jiangsu province | Network technology development, technical consultation, technical services; Software development | 100.00% | Establishment | |
Jiangsu Zhaiugou E-commerce Co., Ltd | Nanjing, Jiangsu province | Nanjing, Jiangsu province | Commerce | 100.00% | Business combinations involving enterprises not under common control | |
NanjingTongmeng City Logistics Co., Ltd. | Nanjing, Jiangsu province | Nanjing, Jiangsu province | Freight Transport, Warehouse service | 99.99% | Business combinations involving enterprises not under common control | |
Nanjing Jinling Tongmeng City Logistics Co., Ltd. | Nanjing, Jiangsu province | Nanjing, Jiangsu province | Freight Transport, Warehouse service | 51.00% | Business combinations involving enterprises not under common control | |
Huaian Tongmeng City Logistics Co., Ltd. | Huaian, Jiangsu province | Huaian, Jiangsu province | Freight Transport, Warehouse service | 51.00% | Business combinations involving enterprises not under common control | |
Changzhou Jiezzhong Tongmeng City Logistics Co., Ltd. | Changzhou, Jiangsu province | Changzhou, Jiangsu province | Freight Transport, Warehouse service | 51.00% | Business combinations involving enterprises not under common control | |
Nantong Tongmeng City Logistics Co., Ltd. | Nantong, Jiangsu province | Nantong, Jiangsu province | Freight Transport, Warehouse service | 51.00% | Business combinations involving enterprises not under common control | |
Suzhou Tongmeng City Logistics Co., Ltd. | Suzhou, Jiangsu province | Suzhou, Jiangsu province | Freight Transport, Warehouse service | 51.00% | Business combinations involving enterprises not under common control | |
Taizhou Tongmeng City Logistics Co., Ltd. | Taizhou, Jiangsu province | Taizhou, Jiangsu province | Freight Transport, Warehouse service | 51.00% | Business combinations involving enterprises not under common control | |
Wuxi Tongmeng City Logistics Co., Ltd. | Wuxi, Jiangsu province | Wuxi, Jiangsu province | Freight Transport, Warehouse | 51.00% | Business combinations involving enterprises not under common |
service
service | control | |||||
Yancheng Tongmeng City Logistics Co., Ltd. | Yancheng, Jiangsu province | Yancheng, Jiangsu province | Freight Transport, Warehouse service | 51.00% | Business combinations involving enterprises not under common control | |
Zhenjiang Tongmeng City Logistics Co., Ltd. | Zhenjiang, Jiangsu province | Zhenjiang, Jiangsu province | Freight Transport, Warehouse service | 51.00% | Business combinations involving enterprises not under common control | |
Yangzhou Tongmeng City Logistics Co., Ltd. | Yangzhou, Jiangsu province | Yangzhou, Jiangsu province | Freight Transport, Warehouse service | 53.00% | Business combinations involving enterprises not under common control | |
Suqian Tongmeng City Logistics Co., Ltd. | Suqian, Jiangsu province | Suqian, Jiangsu province | Freight Transport, Warehouse service | 51.00% | Business combinations involving enterprises not under common control | |
Pizhou Tongmeng City Logistics Co., Ltd. | Xuzhou, Jiangsu province | Xuzhou, Jiangsu province | Freight Transport, Warehouse service | 51.00% | Business combinations involving enterprises not under common control | |
Lianyungang Huaxing Tongmeng City Logistics Co., Ltd. | Lianyungang, Jiangsu province | Lianyungang, Jiangsu province | Freight Transport, Warehouse service | 51.00% | Business combinations involving enterprises not under common control | |
Jiangsu Zhaibianli E-commerce Co., Ltd | Nanjing, Jiangsu province | Nanjing, Jiangsu province | Commerce | 100.00% | Business combinations involving enterprises not under common control | |
Hongkong Zhaiugou International Trade Co., Ltd | Hong Kong, China | Hong Kong, China | Commerce | 100.00% | Business combinations involving enterprises not under common control | |
Guizhou Guijiu Liquor Operation Management Co., Ltd. | Guiyang, Guizhou province | Guiyang, Guizhou province | Commerce | 100.00% | Business combinations involving enterprises not under common control | |
Guizhou Guijiu Trade Co., Ltd. | Guiyang, Guizhou province | Guiyang, Guizhou province | Commerce | 100.00% | Business combinations involving enterprises not under common control | |
ZYG E-Commerce HK Limited | Hong Kong, China | Hong Kong, China | Industrial investment | 100.00% | Business combinations involving enterprises not under common |
control
control | ||||||
ZYG LTD | Cayman Islands | Cayman Islands | Industrial investment | 69.08% | Business combinations involving enterprises not under common control | |
YangHe International Investment Ltd | British Virgin Islands | British Virgin Islands | Industrial investment | 100.00% | Establishment | |
Jiangsu Shuanggou Healthy Liquor Research institute Co., Ltd. | Suqian, Jiangsu province | Suqian, Jiangsu province | Healthy wine, nutrition and health food research and development | 100.00% | Establishment | |
ZYG TECHNOLOGY INVESTMENT LTD | British Virgin Islands | British Virgin Islands | Industrial investment | 71.03% | Business combinations involving enterprises not under common control | |
Jiangsu Blue Dream E- commerce Co., Ltd. | Suqian, Jiangsu province | Suqian, Jiangsu province | Commerce | 100.00% | Establishment | |
Jiangsu Yanghe Weiketang Network Technology Co., Ltd. | Nanjing, Jiangsu province | Nanjing, Jiangsu province | Network technology development, technical consultation, technical service | 100.00% | Establishment | |
Kweichow Moutai Town Guijiu Liquor Industry Co., Ltd | Renhuai, Guizhou province | Renhuai, Guizhou province | Liquor manufacture and sales | 100.00% | Business combinations involving enterprises not under common control | |
Suqian Su Wine Logistics Co., Ltd. | Suqian,Jiangsu province | Suqian, Jiangsu province | Road general cargo transport, cargo distribution, freight forwarder | 100.00% | Establishment | |
YANGHE CHILE SPA | Santiago, Chile | Santiago, Chile | Movable and real estate investment services, building construction services | 100.00% | Establishment | |
Jiangsu Yanghe | Suqian, | Suqian, Jiangsu | Foreign | 50.00% | 50.00% | Establishment |
InvestmentManagement Co.,Ltd.
Investment Management Co., Ltd. | Jiangsu province | province | investment, Asset management, Investment consulting | |||
Su Wine Group Nanjing Operation Management Co., Ltd. | Nanjing, Jiangsu province | Nanjing, Jiangsu province | Enterprise management consulting; Industrial investment; Food sales; Gift sales; House lease; Hotel management | 100.00% | Establishment | |
Jiangsu Zhongshiji liquor Co., Ltd. | Nanjing, Jiangsu province | Nanjing, Jiangsu province | Food sales, Gift sales | 100.00% | Establishment | |
Yanghe Hong Kong Distillery Co., Ltd. | HongKong, China | Hong Kong,China | Industrial investment | 100.00% | Establishment | |
Jiangsu Yanghe Calligraphy and Painting Academy | Nanjing, Jiangsu province | Nanjing, Jiangsu province | Painting and calligraphy creation, exhibition; Academic research; Public art education; Cultural and creative products development and promotion | 100.00% | Establishment | |
Jiangsu Shuanggou Wine Sales Co., Ltd | Sihong, Jiangsu Province | Sihong, Jiangsu Province | Commerce | 100.00% | Establishment | |
Jiangsu Jiushang Internet Technology Co., LTD | Suqian, Jiangsu Province | Suqian, Jiangsu Province | Internet information service, alcohol sales | 51.00% | Establishment | |
Jiangsu Yanghe Cultural Tourism Co., LTD | Suqian, Jiangsu Province | Suqian, Jiangsu Province | Tobacco retail, catering, accommodati | 100.00% | Establishment |
on, tourismbusiness
on, tourism business | ||||||
Jiangsu Yanghe Cultural Tourism Operation Co., LTD. | Suqian, Jiangsu Province | Suqian, Jiangsu Province | Tobacco retail, catering, accommodation, tourism business | 80.00% | Establishment | |
Siyang Blue Sky Packaging Service Co., Ltd | Sihong , Jiangsu Province | Sihong, Jiangsu Province | Wine production and packaging services | 100.00% | Establishment | |
Jiangsu Yanghe Calligraphy and Painting Academy | Nanjing, Jiangsu province | Nanjing, Jiangsu province | Painting and calligraphy creation, exhibition; Academic research; Public art education; Cultural and creative products development and promotion | 51.00% | Establishment | |
Kweichow Moutai Guijiu Liquor Industry Co., Ltd | Zunyi City, Guizhou Province | Zunyi City, Guizhou Province | Commerce | 100.00% | Establishment | |
Jiangsu Ulan Shangyin Catering Management Co., Ltd. | Nanjing, Jiangsu province | Nanjing, Jiangsu province | Catering Management | 100.00% | Establishment | |
Jiangsu Yanghe Dream Investment Management Co., Ltd | Nanjing, Jiangsu province | Nanjing, Jiangsu province | equity investment | 100.00% | Establishment | |
Jiangsu Yanghe Dream Investment Management Co., Ltd. | Nanjing, Jiangsu province | Nanjing, Jiangsu province | equity investment | 100.00% | Establishment |
The shareholding ratio in the subsidiary is different from the voting ratio:
N/A
The basis for holding half or less of the voting rights but still controlling the invested entity, and forholding more than half of the voting rights but not controlling the invested entity
N/A
For important structural subjects included in the scope of merging, the basis of control:
Basis for determining whether the company is an agent or a principal:
2. Interests in joint ventures and associates
(1) Summary of financial information of insignificant joint ventures and associates
Unit: CNY
Closing balance/Current period amount | Opening balance/Previous period amount | |
Associates: | ||
Total carrying amount of investment | 8,173,436.53 | |
The aggregate amount of the following items calculated based on the Company’s equity share percentage of the associates | ||
--Net profit | 909,717.87 | -2,562,964.31 |
--Other comprehensive income | 153,503.58 | 10,293.63 |
-- Total comprehensive income | 1,063,221.45 | -2,552,670.68 |
Joint ventures: | ||
Total carrying amount of investment | 32,979,630.21 | 24,569,960.78 |
The sum of the following items calculated according to the shareholding ratio | ||
--Net profit | 4,291,718.92 | 5,511,685.26 |
-- Total comprehensive income | 4,291,718.92 | 5,511,685.26 |
X. Risks related to financial instrumentsThe Group is exposed to various financial risks in the ordinary course of business, mainly including:
credit risk, liquidity risk, market risk, etc. The Company's management is fully responsible for theformulation of risk management objectives and policies, and takes responsibility for risk managementobjectives and policies. The objective of the Company’s risk management is to identify and analysis risk,minimizing the adverse impact of financial risks without excessive influence on the company'scompetitiveness and resilience.
1. Credit risks
Credit risk refers to the risk that one party of the financial instruments fails to perform itsobligations and causes the financial losses of the other party. Credit risk mainly related to notesreceivables and accounts receivable, in order to control the risk, the Company takes the followingmeasures:
(1) Bank deposit
The company's bank deposits are mainly deposited in state-owned holding banks, large andmedium-sized listed banks and other commercial banks with high credit. There is no significant creditrisk and no significant loss caused by default.
(2) Notes receivables and accounts receivables
The Company mainly trades with distributors, according to company credit policy, and adopts theway of delivery after the payments finished. For some group purchase business, it only deals with thereputable group clients, and continuously monitors the balance of notes receivables and accountsreceivables, as a result, there is no collateral required, and credit risk management concentrates on theclients. The balance of notes receivables and accounts receivables are small till 31 December 2021. TheCompany does not hold any collateral or other credit enhancement for the balance of accountsreceivables.
(3) Other receivable
The other receivables are mainly saving deposits involving infringement dispute, deposits and pettycash, employee business loan and so on. The Company manages other receivables and continuouslymonitors its balance, to ensure the Company not to face significant bad debt risks.
2. Liquidity risk
Liquidity risk refers to the risk of capital shortage when enterprise performs its obligations relatedto financial liabilities. The Company uses various financing methods such as bill clearing and bank loanto optimize the financing structure and maintain the balance between financing continuity andflexibility.
The maturity of the financial liabilities held by the Company according to the undiscountedremaining contractual obligations is analyzed as follows:
Item | Closing balance | ||||
Within 1 year | 1-2 years | 2-3 years | Over 3 years | Total | |
Account payables | 1,376,209,527.01 | 1,376,209,527.01 | |||
Other payables | 1,854,922,517.23 | 1,854,922,517.23 | |||
Long-term loan | |||||
Long-term payables | 196,459,834.53 | 196,459,834.53 |
(Continued)
Item | Opening balance | ||||
Within 1 year | 1-2 years | 2-3 years | Over 3 years | Total | |
Account payables | 1,444,175,262.08 | 1,444,175,262.08 | |||
Other payables | 1,808,838,882.26 | 1,808,838,882.26 | |||
Long-term loan | 36,360.00 | 36,360.00 | |||
Long-term payables | 196,694,194.53 | 196,694,194.53 |
3. Market risk
Market risk is the fair value of financial instrument or future cash flow fluctuates due to the fluctuation ofmarket price, and it mainly includes: interest rate risk, foreign exchange risk, etc.
(1) Interest rate risk
Interest rate risk refers to the fair value of financial instrument or future cash flow fluctuates due to thefluctuation of interest rate. The Company faces the risk of market interest rate change mainly related to theCompany's borrowing limit.
(2) Foreign exchange risk
Foreign exchange risk arises from fluctuation in exchange rate, relevant to the assets and liabilities inforeign currency. The less import and export business happened, the lower impact of exchange rate fluctuationon company's operation.
The amount in CNY of the Company’s assets and liabilities shown in foreign currencies as follows:
Item | Closing balance | Opening balance | ||||
Balance in foreign currency | Exchange rate | Balance in CNY | Balance in foreign currency | Exchange rate | Balance in CNY | |
Cash and cash equivalents | ||||||
Include: USD | 2,325,513.37 | 6.9646 | 16,196,270.44 | 10,263,661.09 | 6.3757 | 65,438,024.01 |
HKD | 11,621,517.91 | 0.8933 | 10,381,501.95 | 4,177,908.36 | 0.8176 | 3,415,857.87 |
CLP | 471,084,627.00 | 0.008131 | 3,830,608.28 | 1,119,093,451.00 | 0.007483 | 8,374,417.98 |
Other receivables | ||||||
HKD | 155,679.16 | 0.8933 | 139,068.19 | 123,179.16 | 0.8176 | 100,711.28 |
Account payables | ||||||
Include: USD | 2,766,806.95 | 6.9646 | 19,269,703.68 | 938,460.83 | 6.3757 | 5,983,344.71 |
Other payables | ||||||
Include: USD | 512.13 | 6.9646 | 3,566.78 | |||
HKD | 217,800.00 | 0.8933 | 194,560.74 | 448,590.73 | 0.8176 | 366,767.78 |
CLP | 328,119.00 | 0.008131 | 2,668.09 | 579,431.00 | 0.007483 | 4,336.01 |
Net amount | 11,076,949.57 | 70,974,562.64 |
The amount of foreign currency financial assets and financial liabilities of the company is small, andexchange rate fluctuations have little impact on the company's business performance.XI. Fair value disclosure
1. The Financial Assets and Financial Liabilities Measured at Fair Value at the end of theReporting Period
Unit: CNY
Item | Closing fair value | |||
Level 1 | Level 2 | Level 3 | Total | |
Continuous fair value measurement | -- | -- | -- | -- |
Financial assets held for trading | 1,074,170,177.19 | 13,072,614,102.75 | 14,146,784,279.94 | |
1.Measured at fair value through current profit and | 1,074,170,177.19 | 13,072,614,102.75 | 14,146,784,279.94 |
loss
loss | ||||
(1) Debt instrument investment | 8,298,193,452.49 | 8,298,193,452.49 | ||
(2) Equity instrument investment | 1,074,170,177.19 | 4,774,420,650.26 | 5,848,590,827.45 | |
Receivables Financing | 623,098,310.00 | 623,098,310.00 | ||
Bank acceptance bill | 623,098,310.00 | 623,098,310.00 | ||
Total assets continuously measured at fair value | 1,074,170,177.19 | 13,695,712,412.75 | 14,769,882,589.94 | |
Non-Continuous fair value measurement | -- | -- | -- | -- |
2. Basis for determining the market price of continuous and non-continuous level 1 fair valuemeasurement items
Item | Fair value | Active market price | |
Trading price | Information source | ||
Continuous fair value measurement | |||
Trading financial assets: | |||
Equity instrument investment | 1,074,170,177.19 | Closing price | Local open market closing price |
Total assets continuously measured at fair value | 1,074,170,177.19 |
3. Valuation techniques and qualitative and quantitative information of key parametersadopted for continuous and non-continuous level 2 fair value measurement it
None
4. Valuation techniques and qualitative and quantitative information of key parametersadopted for continuous and non-continuous level 3 fair value measurement it
Item | fair value | Valuation techniques |
Continuous fair value measurement | ||
1.Financial assets held for trading: | 13,072,614,102.75 | |
Debt instrument investment | 8,298,193,452.49 | Using expected returns as an important reference for evaluating its fair value |
Equity instrument investment | 4,774,420,650.26 | Using cost or the net assets of the invested entity at the end of the period as an important reference for evaluating its fair value |
2.Receivables Financing | 623,098,310.00 | |
Bank acceptance bill | 623,098,310.00 | Using the face value as an important reference for evaluating its fair value |
Item
Item | fair value | Valuation techniques |
Total assets continuously measured at fair value | 13,695,712,412.75 |
XII. Related parties and related party transactions
1. The parent company of the Company
Name of parent company | Registration place | Business nature | Registered capital | Shareholding ratio by the parent company | Voting Ratio by the parent company |
Jiangsu Yanghe Group Co., Ltd. | Suqian, Jiangsu | Sales of brewing machinery equipment, export of liquor, import of various raw and auxiliary materials, equipment and accessories required for production, industrial investment. | CNY 1.5 billion | 34.16% | 34.16% |
Information about the Company’s parent company:
The final control party of the Company is State-owned Assets Supervision and Administration Commission ofSuqian.Other statements:
2. Subsidiaries of the Company:
The information about the subsidiaries of the Company refers to NoteVI.1 Interests in Subsidiaries.
3. Joint venture and associate of the Company
The information about the joint venture and associate of the Company refers to the Note VI.2.Other joint ventures and associates whose related party transactions with the Company in the current periodor balance formed from related party transactions with the Company in the prior period as follows:
Name of joint venture and associate | Relationship with the Company |
Diageo International Spirits Company Limited | Joint Venture |
Jiangsu Su Wine Cultural Transmission Co., Ltd. | Associate |
Nanjing Hesong Culture Technology Co., Ltd. | Associate |
Jiangsu Xinghe Investment Management Co., Ltd. | Associate |
4. Other related party
Name of other related party | Relationship with the Company |
Shanghai Haiyan Logistics Development Co., Ltd. | Holding 9.67% shares |
VSPT, Vi?a San Pedro Tarapacá S.A. | Joint stock company, holding 12.50% shares |
Jiangsu Diageo Wine Co. LTD
Jiangsu Diageo Wine Co. LTD | Controlled by Diageo International Spirits Company Limited, joint venture of Company |
5. Related party transactions
(1) Related party transactions regarding sales and purchases of goods, provision of services and receivingservicesStatement of purchase of goods / Receipt of labor services
Unit: CNY
Related Party | Transaction Content | Amount for the current period | Approved transaction amount | Whether exceeding the approved transaction amount | Amount for the prior period |
VSPT, Vi?a San Pedro Tarapacá S.A | Red wine | 16,462,530.10 | 21,169,155.61 | ||
Nanjing Hesong Culture Technology Co., Ltd. | Advertising and general publicity expense | 756,341.39 | 303,276.09 | ||
Jiangsu Diageo Wine Co. LTD | Liquor | 10,129,543.56 | |||
Total | 17,218,871.49 | 31,601,975.26 |
Statement of sales of goods/ rendering of labor services
Unit: CNY
Related Party | Transaction Content | Current period amount | Previous period amount |
Shanghai Haiyan Logistics Development Co., Ltd. | Sales of liquor | 866,000.02 | 5,067,075.48 |
Jiangsu Su Wine Cultural Transmission Co., Ltd. | Sales of liquor | 40,369,222.60 | 46,448,093.82 |
Jiangsu Diageo Wine Co. Ltd | Sales of liquor | 3,820,908.96 | |
Jiangsu Xinghe Investment Management Co., Ltd. | Consulting fee income | 2,443,396.23 | |
Total | 41,235,222.62 | 57,779,474.49 |
(2) Related party lease
The Company as a lessor
Unit: CNY
Related party | Types of Leased Assets | Amount in current period | Amount in previous period |
None |
The Company as a lessee
Unit: CNY
Relatedparty
Related party | Types of Leased Assets | Simplified rental fees for short-term leases and low value asset leases(If Applicable) | Variable lease payments not included in the measurement of lease liabilities(If Applicable) | Rent paid | Interest expense on lease liabilities assumed | Increased use rights assets | |||||
Current period amount | Previous period amount | Current period amount | Previous period amount | Current period amount | Previous period amount | Current period amount | Previous period amount | Current period amount | Previous period amount | ||
Jiangsu Yanghe Group Co., Ltd | lease of houses | 298,165.14 | 201,834.86 | 68,263.37 | 80,013.55 |
(3) Compensation for key managers
Unit: CNY
Item | Current period amount | Previous period amount |
6. Receivables from and payables to related parties
(1) Payables
Unit: CNY
Item | Related party | Closing balance | Opening balance |
Contract liabilities | Shanghai Haiyan Logistics Development Co., Ltd. | 72,307.08 | 6,010,270.99 |
Contract liabilities | Jiangsu Su Wine Cultural Transmission Co., Ltd. | 3,803,634.02 | 26,791,306.31 |
Accounts payables | Jiangsu Diageo Wine Co. Ltd. | 2,195,373.19 | |
Accounts payables | VSPT, Vi?a San Pedro Tarapacá S.A. | 6,508,528.42 | |
Other Payables | Shanghai Haiyan Logistics Development Co., Ltd. | 133,000.00 | 151,531.60 |
Other Payables | Jiangsu Su Wine Cultural Transmission Co., Ltd. | 950,000.00 | 1,000,451.00 |
XIII. Share-based payment
1. Overview of Share-based Payments
?Applicable □N/A
Unit: CNY
Total of equity instruments granted during the current reporting period | 0.00 |
Total of equity instruments vested during the current reporting period | 0.00 |
Total of equity instruments forfeited during the current reporting period | 0.00 |
Other information:
According to Phase I Core Backbone Shareholding Plan (Draft) of Jiangsu Yanghe Distillery Co., Ltd., deliberated
and approved at the second Extraordinary Shareholders' Meeting of 2021 held on August 2, 2021, theshareholding scale of the shareholding plan does not exceed 9,118,384 share. The stock in this stock plan isderived from the company's A-share ordinary shares repurchased by the special account. The duration of theshareholding plan is 36 months, and the lock-up period of the acquired shares is 24 months, which shall becalculated from the date when the draft shareholding plan is approved by the Shareholders' Meeting and thecompany announces the last transfer of the underlying shares to the shareholding plan. Upon expiration of theshareholding plan, the shareholding plan shall terminate automatically, and it may be extended upon theconsent of more than half of the members of the management Committee and the approval of the board ofdirectors. Upon expiration of the lock-up period, the stock rights and interests held in the stock holding planwill be disposed according to the assessment results of the company's performance objectives. Theperformance assessment of the shareholding plan requires that the operating revenue in 2021 should increaseby no less than 15% compared with 2020 and the operating revenue in 2022 should increase by no less than 15%compared with 2021. If the performance assessment indicators are not reached, all the underlying stock rightsand interests held in the shareholding plan shall be recovered by the management Committee and sold at anappropriate time after the expiration of the lock-up period, and shall be returned to the holder on the basis ofthe lower investment amount and the sold amount (after deducting relevant expenses), and the remainingprofits shall be enjoyed by the Company.
The total amount of expenses recognized in the current period is RMB 122,414,308.77, which is included incapital reserve - Other capital reserve, accumulated included in capital reserve - other capital reserves RMB163,118,128.78XIV. Commitments and contingencies
1. Significant commitments
Significant commitments as of the balance sheet dateBy the end of 31 December 2022, there were no significant commitments needed to be disclosed.
2. Contingencies
(1) Significant contingencies as of the balance sheet date:
By the end of 31 December 2022, there were no significant commitments needed to be disclosed.
(2) If no contingencies that need to be disclosed, statement should be made.
The Company has no significant contingencies to disclose.XV. Post balance sheet event
1. Profit distribution
Unit: CNY
Profits or dividends to be distributed | 29,676,346,187.62 |
Profits or dividends declared for distribution after being approved | 5,634,104,576.76 |
Profit distribution plan | The company plans to distribute cash dividends of RMB 37.40 (including tax) to all shareholders for every 10 shares based on the total share capital on the equity registration date when implementing the profit distribution plan (excluding the repurchased shares held in the company's dedicated securities account for repurchase), with undistributed profits, without |
bonus shares or conversion to share capital.
XVI. Notes to major items of financial statements of parent company
1. Accounts receivable
(1) Disclosure of accounts receivable by categories
Unit: CNY
Type | Closing balance | Opening balance | ||||||||
Carrying balance | Credit loss provision | Book value | Carrying balance | Credit loss provision | Book value | |||||
Amount | Percentage (%) | Amount | Proportion of provision | Amount | Percentage (%) | Amount | Proportion of provision | |||
Including: | ||||||||||
Provision for bad debts by portfolio | 1,204,313,384.24 | 100.00% | 151,596.00 | 1,204,161,788.24 | 424,595,684.45 | 100.00% | 424,595,684.45 | |||
Including: | ||||||||||
Risk portfolio | 5,053,200.00 | 0.42% | 151,596.00 | 3.00% | 4,901,604.00 | |||||
Other portfolio | 1,199,260,184.24 | 99.58% | 1,199,260,184.24 | 424,595,684.45 | 100.00% | 424,595,684.45 | ||||
Total | 1,204,313,384.24 | 100.00% | 151,596.00 | 0.01% | 1,204,161,788.24 | 424,595,684.45 | 100.00% | 424,595,684.45 |
Provision for bad debts by portfolio: risk portfolio
Unit: CNY
Name of portfolio | Closing balance | ||
Accounts receivables | Provision for bad debt | Proportion | |
Within 1 year | 5,053,200.00 | 151,596.00 | 3.00% |
Total | 5,053,200.00 | 151,596.00 |
Notes to determine provision for bad debt by portfolio:
Provision for bad debts by portfolio: other portfolio
Unit: CNY
Name of portfolio | Closing balance | ||
Accounts receivables | Provision for bad debt | Proportion | |
Accounts receivable of companies within the scope of consolidation | 1,199,260,184.24 | 0.00% | |
Total | 1,199,260,184.24 |
Notes to determine provision for bad debt by portfolio:
If the Company uses the accounts receivable provision for bad debts according to the generalmodel of expected credit loss, please disclose the relevant information of provision for bad debtby referring to the disclosure method of other receivables
□Applicable ?N/A
Analysis by aging
Unit: CNY
Aging | Closing balance |
Within 1 year (including 1 year) | 1,204,313,384.24 |
Within 1 year | 1,204,313,384.24 |
Total | 1,204,313,384.24 |
(2) Provision for bad debt that is accrued, recovered or reversed during this periodProvision for bad debts during this period:
Unit: CNY
Category | Opening balance | Changes in the current period | Closing balance | |||
Provision | Recovered or reversed | Write off | Others | |||
Provision for bad debt of accounts receivables | 151,596.00 | 151,596.00 | ||||
Total | 151,596.00 | 151,596.00 |
Significant amount of reversal or recovery during this period
Unit: CNY
Company name | Amount recovered or reversed | Method |
None |
(3) Top five entities with the largest balances of the accounts receivables
Unit: CNY
Company’s name | Closing balance | Proportion in the total accounts’ receivables (%) | Provision amount |
First | 1,106,779,402.21 | 91.90% | |
Second | 91,345,507.40 | 7.59% | |
Third | 5,053,200.00 | 0.42% | 151,596.00 |
Fourth | 855,899.68 | 0.07% | |
Fifth | 279,374.95 | 0.02% | |
Total | 1,204,313,384.24 | 100.00% |
2. Other receivables
Unit: CNY
Item | Closing balance | Opening balance |
Dividend receivable | 1,812,736,853.55 | |
Other receivables | 1,068,086,225.72 | 399,089,264.75 |
Total | 1,068,086,225.72 | 2,211,826,118.30 |
(1) Dividend receivable
1)Category of dividend receivable
Unit: CNY
Item | Closing balance | Opening balance |
Dividends receivable from subsidiaries | 1,812,736,853.55 | |
Total | 1,812,736,853.55 |
2) Provision for bad debt
□Applicable ?N/A
(2) Other receivables
1) Disclosure of other receivable by nature
Unit: CNY
Nature of other receivables | Closing balance | Opening balance |
Payments by related parties within the Group | 1,062,874,527.41 | 397,751,387.98 |
Guarantee deposit | 18,498,496.00 | 15,060,000.00 |
Business loans and petty cash | 1,128,524.66 | 575,275.71 |
Other receivables | 2,602,307.10 | 2,527,992.51 |
Total | 1,085,103,855.17 | 415,914,656.20 |
2) Provision for bad debt
Unit: CNY
Provisions for debts | Phase 1 | Phase 2 | Phase 3 | Total |
Future 12-month ECL | Lifetime ECL(without credit impairment) | Lifetime ECL(with credit impairment) | ||
Balance as at 1 January 2022 | 57,926.49 | 16,767,464.96 | 16,825,391.45 | |
Change of opening balance as at 1 January 2022 in current period | ||||
Provision in 2022 | 192,238.00 | 192,238.00 | ||
Balance as at 31 December 2022 | 250,164.49 | 16,767,464.96 | 17,017,629.45 |
Significant change of the book balance of provision during the period
□Applicable ?N/A
Other receivables by aging
Unit: CNY
Aging | Closing balance |
Within 1 year (including 1 year) | 739,643,544.05 |
Within 1 year | 739,643,544.05 |
1-2 years | 314,455,495.91 |
2-3 years | 460,000.00 |
Over 3 years | 30,544,815.21 |
3-4 years | 8,830,032.00 |
4-5 years | 848,000.00 |
Over 5 years | 20,866,783.21 |
Total | 1,085,103,855.17 |
3) Provision, recovery or reversal for bad debt during this period
Unit: CNY
Category | Opening balance | Changes in the current period | Closing balance | |||
Provision | Recovered or reversed | Write off | Other changes | |||
Provision for other receivables bad debt | 16,825,391.45 | 192,238.00 | 17,017,629.45 | |||
Total | 16,825,391.45 | 192,238.00 | 17,017,629.45 |
Significant amount of reversal or recovery during this period:
Unit: CNY
Company name | recovery or reversal | Way of recovery |
4) Top five entities with the largest balances of the other receivables
Unit: CNY
Company’s Name | Category | Closing balance | Aging | Proportion in total receivables | Provisioning amount at period end |
Guizhou Guijiu Co., Ltd. | Loan | 941,550,495.91 | Within 1 year627,605,000.00,1-2years 313,945,495.91 | 86.77% | |
Guizhou Maotai Town Guijiu Liquor Industry Co., Ltd | Loan | 103,640,000.00 | Within 1 year | 9.55% | |
Jiangsu Juntai Properties Co., Lt., Suqian Guotai Department Store Co., Ltd. | deposit | 15,000,000.00 | Over 5 years | 1.38% | 15,000,000.00 |
Harbin Binzhou Distillery Co., Ltd. | Loan | 14,807,100.00 | Within 1 year 230,000.00, 1-2years 400,000.00,2-3years 460,000.00, over 3 years 13,717,100.00 | 1.36% | |
Siyang County Land Acquisition and Reserve Center | guarantee | 2,938,464.00 | Within 1 year | 0.27% | 58,769.28 |
合计 | 1,077,936,059.91 | 99.33% | 15,058,769.28 |
3. Long-term equity investments
Unit: CNY
Item | Closing balance | Opening balance | ||||
Book balance | Impairment provision | Book value | Book balance | Impairment provision | Book value | |
Investment in subsidiaries | 8,180,436,290.49 | 8,180,436,290.49 | 7,994,556,728.17 | 7,994,556,728.17 | ||
Total | 8,180,436,290.49 | 8,180,436,290.49 | 7,994,556,728.17 | 7,994,556,728.17 |
(1) Investment in subsidiaries
Unit: CNY
Investee | Opening balance | Increase or decrease in the current period | Closing balance | Closing balance of provision for | |||
Increase | Decrease | Provision for impairment | Others |
impairment | |||||||
Suqian Yanghe Guibinguan Co., Ltd. | 700,000.00 | 700,000.00 | |||||
Jiangsu Shuanggou Distillery Stock Co., Ltd. | 1,717,299,880.97 | 12,368,912.08 | 1,729,668,793.05 | ||||
Su Wine Trade Group Co., Ltd. | 306,242,867.20 | 61,510,650.24 | 367,753,517.44 | ||||
Jiangsu Yanghe Liquor Operation Management Co., Ltd | 10,983,280.00 | 10,983,280.00 | |||||
Jiangsu Dongdi Union International Trade Co., Ltd. | 5,000,000.00 | 5,000,000.00 | |||||
Jiangsu Dongdixinghui International Trade Co., Ltd | 5,000,000.00 | 5,000,000.00 | |||||
Siyang Lantu Liquor Operation Co., Ltd. | 3,161,700.00 | 3,161,700.00 | |||||
Hubei Lihuacun Liquor Industry Co., Ltd. | 3,000,000.00 | 3,000,000.00 | |||||
Ningxiang Miluochun Liquor Industry Co., Ltd. | 2,129,000.00 | 2,129,000.00 | |||||
Harbin Binzhou Distillery Co., Ltd. | 2,000,000.00 | 2,000,000.00 | |||||
Su Wine Group Jiangsu Wealth Management Co., Ltd. | 3,000,000,000.00 | 3,000,000,000.00 | |||||
Jinagsu Kelite Biology Technology Research Institute | 10,000,000.00 | 10,000,000.00 |
Co., Ltd. | |||||||
Jiangsu Lion and Sheep Network Technology Co., Ltd. | 5,460,000.00 | 5,460,000.00 | |||||
Guizhou Guijiu Co., Ltd. | 943,300,000.00 | 943,300,000.00 | |||||
Jiangsu Yanghe Weiketang Network Technology Co., Ltd. | 300,000.00 | 300,000.00 | |||||
YANGHE CHILE SPA | 456,880,000.00 | 456,880,000.00 | |||||
Jiangsu Yanghe Investment Management Co., Ltd. | 1,500,000,000.00 | 1,500,000,000.00 | |||||
Yanghe Hong Kong Liquor Co., Ltd. | 18,000,000.00 | 18,000,000.00 | |||||
Jiangsu Jiushang Internet Technology Co., LTD | 5,100,000.00 | 5,100,000.00 | |||||
Tibet Earth Third Pole Liquor Industry Co., Ltd | 102,000,000.00 | 102,000,000.00 | |||||
Jiangsu Yanghe Dream Investment Management Co., Ltd | 20,000,000.00 | 20,000,000.00 | |||||
Total | 7,994,556,728.17 | 122,000,000.00 | 10,000,000.00 | 73,879,562.32 | 8,180,436,290.49 |
4. Operating revenue and cost of sales
Unit: CNY
Item | Current period amount | Previous period amount | ||
Operating revenue | Cost of sales | Operating revenue | Cost of sales | |
Primary business | 11,033,861,278.77 | 5,597,622,749.56 | 9,855,981,149.71 | 5,134,136,876.95 |
Other business | 458,946,611.18 | 382,597,476.00 | 620,861,040.12 | 558,762,391.77 |
Total | 11,492,807,889.95 | 5,980,220,225.56 | 10,476,842,189.83 | 5,692,899,268.72 |
Information relating to revenue
Unit: CNY
Category of Contract | Segment 1 | Segment 2 | Current period amount | Total |
Commodity type | 0.00 | |||
Including: | ||||
Liquor | 11,033,861,278.77 | 11,033,861,278.77 | ||
Other | 458,946,611.18 | 458,946,611.18 | ||
By operating region | ||||
Including: |
Type of market or customer | ||||
Including: | ||||
Type of contract | ||||
Including: | ||||
By the time of commodity transfer | ||||
Including: | ||||
By contract term | ||||
Including: | ||||
By Selling channel | ||||
Including: | ||||
Total | 11,492,807,889.95 | 11,492,807,889.95 |
Information relating to performance obligations
N/A
Information relating to the transaction price apportioned to the remaining performanceobligations:
At the end of this report, the amount of revenue corresponding to the performance obligationswith the contracts signed but not performed or not performed is CNY 17,485,085,741.24, ofwhich CNY 17,485,085,741.24 is expected to be recognized in 2023, and CNY 0.00 is expected tobe recognized in 2024. CNY 0.00 is expected to be recognized as revenue in 2025.
5. Investment income
Unit: CNY
Item | Current period amount | Previous period amount |
Investment income from long-term equity investments under the equity method | 5,529,140,387.31 | 3,816,035,295.48 |
Investment income from financial assets held for trading during the holding period | 3,865,643.47 | 10,199,080.04 |
Investment income from disposal of financial assets held for trading | 299,644,621.19 | 198,932,628.59 |
Income from derecognition of financial assets measured at amortized cost | -11,790,752.31 | |
Total | 5,820,859,899.66 | 4,025,167,004.11 |
XIV. Supplementary information
1. Detailed statement of non-recurring profits and losses
?Applicable □N/A
Unit: CNY
Item | Amount | Note |
Profit or loss from disposal of non- current assets | -5,887,909.75 | |
Government grants accounted for, in the profit or loss for the current period | 60,162,525.57 |
(except for the government grants closely related to the business of the Company and given at a fixed amount or quantity in accordance with the state's uniform standards) | ||
In addition to the effective hedging business related to the company's normal business operations, changes in fair value from holding financial assets held for trading, derivative financial assets, financial liabilities held for trading, fair value changes, and investment income from disposal of financial assets held for trading and derivative financial assets, financial liabilities held for trading, derivative financial liabilities and other debt investments | 77,907,331.60 | |
Other non-operating income and expense except the items mentioned above | 827,476.72 | |
Other profit and loss items that conform to the definition of non-recurring profits and losses | 3,610,292.93 | |
Less: Effect of income tax | 34,647,176.78 | |
Effect of minority equity | 784,942.50 | |
Total | 101,187,597.79 | -- |
Specific details of other profit and loss items that conform to the definition of non-recurringprofits and losses
□Applicable ?N/A
The Company does not have any Specific details of other profit and loss items that conform to thedefinition of non-recurring profits and lossesStatement for extraordinary gain and loss items that the Company defines according to thedefinition in Explanatory Announcement of Information Disclosure of Company that IssuesSecurities publicly No.1- Extraordinary Gain and Loss and definition of recurrent gain and lossitems that are listed as extraordinary gain and loss in the Explanatory Announcement ofInformation Disclosure of Company that Issues Securities publicly NO. 1- Extraordinary Gain andLoss:
□Applicable ?N/A
2. Return on equity and earnings per share
Profit during reporting period | Weighted average ROE | EPS (CNY/Share) | |
Basic EPS | Diluted EPS | ||
Net profits attributable to ordinary shareholders of the Company | 21.03% | 6.2251 | 6.2251 |
Net profits attributable to ordinary shareholders of the Company after deduction of extraordinary gain and loss | 20.80% | 6.1580 | 6.1580 |
3. Difference of the accounting data under accounting rules in and out ofChina
(1) Difference of the net profit and net assets disclosed in financial report, under both IAS(International Accounting Standards) and Chinese GAAP (Generally Accepted Accounting
Principles)
□Applicable ?N/A
(2) Difference of the net profit and net assets disclosed in financial report, under both foreignaccounting rules and Chinese GAAP (Generally Accepted Accounting Principles)
□Applicable ?N/A
(3) Explain the reasons for differences in accounting data under domestic and foreignaccounting standards, and, where the data audited by an overseas audit institution are subject toadjustment for difference, indicate the name of the overseas institution.
None.
4.Others