Stock Code: 000055, 200055 Stock ID: Fangda Group, Fangda B Announcement No. 2020-43
China Fangda Group Co., Ltd. Interim Report 2020
SummaryI. Important DeclarationThe interim report summary is abstract from the interim report. Investors should read the annual report from the specified media tofully understand the Company’s business achievements, financial status and future plans.All the Directors have attended the meeting of the board meeting at which this report was examined..Non-standard auditing opinion
□ Applicable √ Inapplicable
Profit distribution pre-plan or capitalization plan in the period reviewed by the Board of Directors
□ Applicable √ Inapplicable
The Company will distribute no cash dividends or bonus shares and has no reserve capitalization plan.The preference share profit distribution pre-plan approved by the Board of Directors
□ Applicable √ Inapplicable
II. General Information
1. Company Profile
| Stock ID | Fangda Group, Fangda B | Stock code | 000055, 200055 | |
| Stock Exchange | Shenzhen Stock Exchange | |||
| Modified stock ID | None | |||
| Contacts and liaisons | Secretary of the Board | Representative of Stock Affairs | ||
| PRINTED NAME | Xiao Yangjian | GuoLinchen | ||
| Office address | 20F, Fangda Technology Building, Kejinan 12th Avenue, High-tech Zone, Hi-tech Park South Zone, Shenzhen, PR China. | 20F, Fangda Technology Building, Kejinan 12th Avenue, High-tech Zone, Hi-tech Park South Zone, Shenzhen, PR China. | ||
| Telephone | 86(755) 26788571 ext. 6622 | 86(755) 26788571 ext. 6622 | ||
| zqb@fangda.com | zqb@fangda.com | |||
2. Financial Highlight
Whether the Company needs to make retroactive adjustment or restatement of financial data of previous years
□ Yes √ No
| This report period | Same period last year | Year-on-year change (%) | |
| Turnover (yuan) | 1,251,608,064.42 | 1,425,890,946.99 | -12.22% |
| Net profit attributable to shareholders of the listed company (yuan) | 146,839,884.57 | 128,581,755.01 | 14.20% |
| Net profit attributable to the shareholders of the listed company and after deducting of non-recurring gain/loss (RMB) | 146,292,847.94 | 113,377,064.06 | 29.03% |
| Net cash flow generated by business operation (RMB) | -136,985,479.40 | -372,725,003.11 | 63.25% |
| Basic earnings per share (yuan/share) | 0.13 | 0.11 | 18.18% |
| Diluted Earnings per share (yuan/share) | 0.13 | 0.11 | 18.18% |
| Weighted average net income/asset ratio | 2.81% | 2.55% | 0.26% |
| End of the report period | End of last year | Year-on-year change | |
| Total asset (RMB) | 11,481,781,127.67 | 11,369,964,580.11 | 0.98% |
| Net profit attributable to the shareholders of the listed company (RMB) | 5,176,776,062.41 | 5,182,795,079.67 | -0.12% |
3. Shareholders and shareholding
In share
| Number of shareholders of common shares at the end of the report period | 61,834 | Number of shareholders of preferred stocks of which voting rights recovered in the report period (if any) | 0 | ||||||
| Top 10 Shareholders | |||||||||
| Shareholder name | Nature of shareholder | Shareholding percentage | Shareholding number | Conditional shares | Pledging or freezing | ||||
| Share status | Quantity | ||||||||
| Shenzhen Banglin Technologies Development Co., Ltd. | Domestic non-state legal person | 10.55% | 114,847,854 | Pledged | 32,700,000 | ||||
| Shengjiu Investment Ltd. | Foreign legal person | 9.57% | 104,127,479 | ||||||
| Fang Wei | Domestic natural person | 3.62% | 39,372,437 | ||||||
| Gong Qing Cheng Shi Li He Investment Management Partnership Enterprise (limited partner) | Domestic non-state legal person | 2.46% | 26,791,488 | ||||||
| VANGUARD TOTAL INTERNATIONAL STOCK INDEX FUND | Foreign legal person | 0.64% | 6,986,407 | ||||||
| VANGUARD EMERGING MARKETS STOCK INDEX FUND | Foreign legal person | 0.58% | 6,312,683 | ||||||
| ShenwanHongyuan Securities (Hong Kong) Co., Ltd. | Foreign legal person | 0.52% | 5,705,823 | ||||||
| Qu Chunlin | Domestic natural person | 0.51% | 5,557,161 | ||||||
| Chen Sheng | Domestic natural person | 0.46% | 5,000,000 | ||||||
| First Shanghai Securities Limited | Foreign legal person | 0.36% | 3,938,704 | ||||||
| Notes to top ten shareholder relationship or "action in concert" | Among the shareholders, Shenzhen Banglin Technology Development Co., Ltd. and Shengjiu Investment Co., Ltd. are parties action-in-concert. Shenzhen Banglin Technology Development Co., Ltd. and Gong Qing Cheng Shi Li He Investment Management Partnership Enterprise are related parties. The Company is not notified of other action-in-concert or related parties among the other holders of current shares. | ||||||||
| Statement of shareholders participating in margin trade (if any) | Shenzhen Banglin Technology Development Co., Ltd. holds 55,000,000 shares of the company through the customer credit transaction guarantee securities account of Ping An Securities Co., Ltd. | ||||||||
4. Changes in controlling shareholder or actual controller
Changes in the controlling shareholder in the reporting period
□ Applicable √ Inapplicable
No change in the controlling shareholder in the report periodChange in the actual controller in the report period
□ Applicable √ Inapplicable
No change in the actual shareholder in the report period
5.Total number of preferred shareholders and shareholding of top 10 preferred shareholders by the end ofthe report period
□ Applicable √ Inapplicable
No shareholder of preferred shares in the report period
6. Bonds
The company does not have any corporate bonds that are publicly issued and listed on the stock exchange, and are not yet due on thedate of approval of the semi-annual report or cannot be fully redeemed when they are due.III. Operation Discussion and Analysis
1. Business status in the report period
In 2020 H1, the COVID-19 epidemic has been rampant in the world. The epidemic abroad has not seen any turning point,social and economic industries have been greatly impacted, domestic and international economic negative growth, demand decline,which has brought great challenges to the company operation. Under the adverse circumstance, the Company always insists ongrasping epidemic prevention and control, grasping rework and production, marketing, sales, collection, cost control and otherproduction and operation work. Under the leadership of the board of directors, through the efforts of all the staff, the Companybasically completed the business target of 2020 H1. The order reserve, net profit and other important business indexes not only didnot decline, but also achieved a certain increase, which is very difficult.During the reporting period, the net profit attributable to owners of the parent company was RMB146,839,900, an increase of
14.20% over the same period last year, and the net profit attributable to owners of the parent company after deducting non-recurringgains and losses was RMB146,292,800, an increase from the same period last year of 29.03%; The company achieved operatingincome of RMB 1,251,608,100. Affected by the epidemic, it decreased by 12.22% from the same period of the previous year.However, it recovered strongly in the second quarter and achieved operating income of RMB 837,781,200 in the second quarter, ayear-on-year increase of 10.90%. As of the end of the reporting period, the company's order reserve was RMB4,808,923,100(excluding real estate sales), an increase of 5.99% compared with the beginning of the year, which was 3.84 times of the operatingincome in the first half of the year. Adequate order reserve provided a strong guarantee for the company's sustainable development.
At present and in the future, epidemic and economic situation are more uncertain. China is speeding up to form a newdevelopment pattern with domestic consumption cycle as the main body and domestic and international double cycle promoting eachother. The Company will make full use of the top brand advantages at home, rely more on scientific and technological innovation,empower advanced science and technology into production and operation, continuously improve product quality and enterprisebenefit, and maintain sustainable development of the company.
(1) High-end curtain wall system and material business
In 2020, it is the 40th anniversary of the establishment of Shenzhen Special Economic Zone. It is the year for the constructionof Guangdong, Hong Kong, Macau and Shenzhen to spread out and push forward the construction of socialism with Chinesecharacteristics in an all-round way. The "chemical effect" and "multiplier effect" will be released in a new era of the "two zones"drive force. The company seizes the opportunity, makes full use of the advantages of Shenzhen, which is located in the core area ofthe Guangdong-Hong Kong-Macao Greater Bay Area, adheres to the business philosophy of "technology-based, innovation as thesource", and adheres to the "Fangda Craftsman" spirit of excellence and quality. With core competitiveness in product quality,technical strength, and brand influence, we strive to expand the market with extraordinary efforts. During the reporting period, theCompany successively won the bid or signed contracts with Shenzhen CIMC Satellite Internet of Things Industrial Building,
Shenzhen Chuangzhi Cloud City Phase III, Shenzhen Ruifeng Optoelectronic Building Project, Shenzhen ShenyeHetangling Garden,Guangzhou Vanke Expo Land No. 15, Dongguan Chang’anOPPO R&D Center Project, TianheMingmenHao Ting in Shantou City,Shanghai Qibao Vanke Ecological Business District Commercial Office Project, Hangzhou Fantasia 360 Project, Nanjing Scienceand Technology Development Island Southern Primary School, Eco-Tech Island Northern Junior High School Project , NanchangXinli Times Square 2# Building, Kunming JinmaoYiting Business Center, Chengdu Merchants Damofang 12# Building, NingxiaBaofeng Hospital and Nursing Home Project, Geelong GMHBA Project in Australia, Rosella Project in Melbourne, Australia, WillsSt Project in Melbourne, Australia, Thailand A large number of high-end curtain wall system and material projects such as the SAMproject and the Saudi Metro FLASH bid section. The total amount of the winning bids and the newly signed orders was RMB1.499billion, an increase of 27.25% over the same period last year. Among them, the Guangdong-Hong Kong-Macao Greater Bay Areaproject amounted to RMB873 million, accounting for 58.24% of the aggregate. 2. In the reporting period, the curtain wall system andmaterials industry realized operating income of RMB841,699,200, an increase of 16.29% over the same period of the previous year;the net profit was RMB91,247,700, an increase of 88.56%; with a gross margin of 16.67%, up 0.89 percentages over the same periodof last year; As of the end of the reporting period, the Company's curtain wall system and materials business orders reserve wasRMB316,8661,400, which was 376% of the sales revenue of the curtain wall system and materials business in 2019 H1.In order to meet the increasing demand for orders, the Company started construction in 2019 and built a new production base inEast China in Shanghai Songjiang. It is planned to be put into use in the second half of the year. The base occupies 2.38 000 squaremeters and has a total construction area of about 43,000 square meters. After completion, the Company's curtain wall system andmaterials industry are formed with Shenzhen as the headquarters South China with Dongguan Songshan Lake and Foshan as the baseSouthwest China with Chengdu as the base East China with Shanghai and Central China with Nanchang. As the base of thenational industrial layout, it provides an important guarantee for improving market share and comprehensive competitiveness.During the reporting period, the company strengthened management innovation, through intelligent factory construction,technology innovation, marketing system reform, project refined management and other reform and innovation measures, began toput advanced science and technology into the enterprise work, abandon the human sea tactics, change production mode, optimizeproduction process, improve production efficiency, accelerate the company from "manufacturing" to "intellectual manufacturing". Itis expected that the first smart factory will be built at Dongguan Songshan Lake Base at the end of this year to the first half of nextyear.
(2) Rail transport screen door business
Facing the severe test and complicated and changeable domestic and international environment brought by the new crownepidemic, the company successively won the contract with the market occupation rate, brand influence, patent possession quantity,standard formulation and maintenance professional service and other leading advantages such as Xi'an metro line 5 phase 2, Nanningcity rail transit line 5 phase 1 project (Guo Kai Avenue-JinQiao passenger station), Fuzhou rail transit line 5 and other shielding doorsystem project orders, Shenzhen metro lines 1, 2, 5, 11, Nanchang rail transit line 2, etc. By the end of the report period, undeliveredorders for screen doors are worth RMB1,640,261,600. 3. In the first quarter of 2020, the rail transit equipment industry realizedoperating income of RMB333,462,700, an increase of 68.47% over the same period of the previous year; the order reserve quantity is
4.92 times the operating income in the first half of the year; the net profit was RMB58,581,900, an increase of 64.42% over the sameperiod of the previous year. The gross margin is 26.99%.
With the development of China ’s urban rail transit from scratch, from a single line to a network, and the end of the freemaintenance period for more and more rail transit screen doors, the demand for specialized technical maintenance services continuesto grow. In the reporting period, the company achieved technical maintenance service income of RMB15,274,000, an increase of
28.70% over the same period last year. The Company is a leading company that can provide the entire industry chain technology andproduct services for subway screen doors. The added value of technical services is high. In the future, this business will become animportant performance growth point for the company. The Company will also strive to become a metro screen door technologymaintenance service expert.
During the reporting period, Hangzhou Metro Line 16 and Shenyang Metro Line 10, equipped with Fangda screen door system,were put into operation successively. At present, Fangda Shielding Door System has been applied in 42 cities of the world. More than10 million people use Fangda Shielding Door System every day, maintaining the world's leading market share, and the city coveragerate of metro operation has reached over 80% in China. With the advanced original technology, independent brand and high qualityservice, Fangda Shielding Door System has promoted the rapid development of China's metro shielding door industry and establishedthe global leading position of China's rail transit shielding door equipment industry.As the largest supplier of rail transit equipment products in the world, the company has won widespread praise for itshigh-quality and efficient professional maintenance services. During the reporting period, the company won the title of “2019High-Quality Screen Door Supplier” at the 2020 (13th) Rail Transit and Urban International Summit, Xiamen Rail Transit Group Co.,Ltd. "Outsourcing Maintenance Advanced Unit", Tianjin Rail Transit Operation Group Co., Ltd. "Excellent Cooperative OutsourcingUnit", Hohhot Metro Line 1 Construction Management Co., Ltd. "Excellent Supplier", Wuhan Railway Travel Service Media Co.,Ltd. Customer Service Maintenance Branch "Excellent Outsourcing Maintenance Project" and other honors . The recognition of theindustry partners affirms the company's advanced technology and product quality in the field of urban rail transit shielding doorequipment, and reflects Fangda's brand influence and maintenance professional service in China's rail transit shielding door industry.
(3) New energy industry
During the reporting period, the company's three solar photovoltaic power stations that have been connected to the grid havemaintained efficient, stable and safe operation. The annual sales revenue achieved an increase of 28.90% over 2019 H1, and theoperating profit achieved an increase of 74.67% over 2019 H1, exceeding expectations.
(4) Real Estate
(1) Project progress
Shenzhen Dacheng Project: The remaining small area of the project is to be sold. In the first half of the year, the tail salesbusiness is affected by epidemic. The Fangda Town project realizes the subscription sales area of 1,434.57 square meters and theremaining area to be sold is 6172.26 square meters. The renting rate of commercial part is 99.46%, the new renting area of officebuilding is 11,506.56 square meters, the renting rate is 48.50%.
Nanchang Fangda Center: The project is located in the Fenghuangzhou District of the New District of Honggutan, NanchangCity. It covers a total area of 16,600 square metres and has a total building area of 66,432.61 square metres. It is a small andmedium-sized commercial complex integrated with office, apartment, shopping, leisure and entertainment. The project is mainly soldand leased, with a sales area of 32,460.11 square metres. It was pre-sold 2on 28 December 2019. The pre-sale area was 1,644.14square metres during the reporting period.
Shenzhen FangdaBangshen Industrial Park Project: The project is located in Fuyong, Bao'an District, Shenzhen. It coversan area of 20,714.90 square meters and is currently an industrial plant. The project was approved in July 2019. During the reportingperiod, the company is actively promoting the special plan of FangdaBongShen project.
Urban renewal project along the Dagang River in Henggang, Shenzhen: The project is located in Dakang Village,Yuanshan Street, Longgang District, Shenzhen. The area of the project to be demolished is about 72,000 square meters. The updatedirection is mainly residential function, and finally subject to government approval. The Company is currently pushing forward theapproval progress of the urban renovation project.
It is expected that the real estate sales and property leasing will continue to contribute profits to the Company in the future. Inorder to achieve its business objectives, the company will adhere to its strategic commitment, maintain a reasonable pace ofdevelopment, continue to increase sales efforts, strengthen sales receivables, rationally arrange financing, ensure the company is safeand sound, and strive to achieve the company's 2020 goals.
(2) New land reserve projects
| Parcel or project name | Land location | Purpose | Land area (m2) | Building area (m2) | Obtaining method | Interests percentage | Total land price (ten thousand | Equity consideration (ten thousand |
| yuan) | yuan) | |||||||
| None |
(3) Total land reserve
| Project/district | Floor area (10,000 m2) | Total building area (10,000 m2) | Remaining building area (10,000 m2) |
| Fangda Town | 3.53 | 21.24 | 0 |
| Nanchang Fangda Center | 1.66 | 6.64 | 0 |
| Total | 5.19 | 27.88 | 0 |
(4) Main production development status
| City/district | Project | Land location | Project form | Interests percentage | Starting time | Development progress | Completion rate | Land area (m2) | Planning construction area (m2) | Area completed in this phase (m2) | Total area completed in this phase (m2) | Estimated total investment (in RMB10,000) | Accumulated total investment (in RMB10,000) |
| Honggutan New District, Nanchang | Fangda Center | No.1516 Ganjiang North Avenue | Commercial | 100.00% | May 1, 2018 | 62.00% | 62.00% | 16,608.55 | 66,432.61 | 0 | 0 | 67,000 | 41,336 |
(5) Main project sales
| City/district | Project | Land location | Project form | Interests percentage | Building area (m2) | Sellable area (m2) | Cumulative pre-sale (sales) area (m2) | Pre-sale (sales) area in this period (m2) | Amount of pre-sale (sales) in the current period (RMB10,000) | Cumulative settlement area (m2) | Settlement area in the current period (m2) | Settlement amount in this period (RMB10,000) |
| Shenzhen Nanshan District | Fangda Town | No.2 Longzhu 4th Road | R&D office commercial complex | 100.00% | 212,400 | 93,086.25 | 85,479.42 | 85,479.42 | ||||
| Honggutan New District, Nanchang | Fangda Center | No.1516 Ganjiang North Avenue | Commercial | 100.00% | 65,388.42 | 32,460.11 | 1644.14 | 1644.14 | 2,301.87 | 1644.14 |
(6) Main project lease
| Project | Land location | Project form | Interests percentage | Leasable area (m2) | Cumulative leased area (m2) | Average lease ratio |
| Shenzhen Fangda Town | Shenzhen Nanshan District | R&D office commercial complex | 100.00% | 72,517.71 | 35,168.44 | 48.50% |
| Shenzhen Fangda Town | Shenzhen Nanshan District | Commercial | 100.00% | 22,775.52 | 22,652.59 | 99.46% |
| Jiangxi Nanchang Science and Technology Park | Nanchang, Jiangxi Province | Plant and office building | 100.00% | 9,832.20 | 9,832.20 | 100.00% |
| Fangda Building | Shenzhen Nanshan District | R&D office building | 100.00% | 17,792.47 | 12,858.46 | 72.27% |
(7) First-level development of land
□ Applicable √ Inapplicable
(8) Financing channel
| Financing source | Ending financing balance (in RMB10,000) | Financing cost range / average financing cost | Term structure | |||
| Less than 1 year | 1-2 years | 2-3 years | Over 3 years | |||
| Bank loan | 118,000 | Based on LPR interest rate, the upper limit is 6.175% | 6,375.00 | 8,750.00 | 8,750.00 | 94,125.00 |
| Total | 118,000 | 6,375.00 | 8,750.00 | 8,750.00 | 94,125.00 | |
(9) Bank mortgage loan guarantee provided for commercial housing purchasers
√ Applicable □ Inapplicable
As of June 30, 2020, the balance of the Company's guarantee for commercial housing offenders due to bank mortgage loans wasRMB492,341,700.
(10) Co-investment by directors, senior management and supervisors and listed company
□ Applicable √ Inapplicable
2. Related issues involved the financial report
(1) Statement of changes to accounting policies, estimates and audit methods compared with the financialreport of the report period
√ Applicable □ Inapplicable
(1) Changes in accounting policies
In 2017, the Ministry of Finance revised and issued the "Accounting Standards for Business Enterprises No. 14-Revenue"(CaiKuai [2017] No. 22) (hereinafter referred to as the "New Revenue Standards"), which requires companies that are simultaneouslylisted domestically and overseas as well as those that are listed overseas. For companies that adopt the International FinancialReporting Standards or Accounting Standards for Business Enterprises to prepare financial statements, they will take effect onJanuary 1, 2018; for other domestic listed companies, they will take effect on January 1, 2020. In accordance with the above unifiedrequirements, the company needs to make corresponding changes to the original accounting policies, and the new revenue standardswill be applied from January 1, 2020.According to the regulations of the convergence between the old and new standards, the company adjusts the amount of retainedearnings at the beginning of the period and other related items in the financial statements based on the cumulative impact of the firstimplementation of the new income standard, and does not adjust the information for the comparable period. This change inaccounting policy has no significant impact on the company's current and previous financial status, operating results and cash flow.
(2) Changes in accounting estimates
In accordance with the requirements of the new financial instrument standards, enterprises should assess whether the credit riskof relevant financial instruments has changed significantly on each balance sheet date. The company uses the latest historical data tocalculate the expected credit loss in 2020 according to the method of calculating expected credit losses in 2019, which has changedsignificantly from 2019. In order to more objectively and truly reflect the financial status and operating results of the company’svarious businesses, Specially make changes in accounting estimates of accounts receivable and expected credit loss rate of contractassets.
This change in accounting estimates will increase the 2020 semi-annual net profit by RMB80,739,565.80.
The above changes in accounting policies and changes in accounting estimates were reviewed and approved at the 22nd meetingof the eighth session of the Board of Directors held on April 16, 2020.
(2) Statement of retrospective restatement of major accounting errors in the report period
□ Applicable √ Inapplicable
No retrospective restatement of major accounting errors in the report period
(3) Statement of change in the financial statement consolidation scope compared with the previous financialreport
√ Applicable □ Inapplicable
In this period, a newly established subsidiary indirectly controlled, namely Jianke Hong Kong Company, was newly added to theconsolidated statement of the current period.
China Fangda Group Co., Ltd.Legal representative: XiongJianmingAugust 22, 2020