Lu Thai Textile Co., Ltd. First Quarter Report 2019
LU THAI TEXTILE CO., LTD.
FIRST QUARTER REPORT 2019
April 2019
Lu Thai Textile Co., Ltd. First Quarter Report 2019
Part I Important Notes
The Board of Directors (or the “Board”), the Supervisory Committee as well as the directors,
supervisors and senior management of Lu Thai Textile Co., Ltd. (hereinafter referred to as the
“Company”) hereby guarantee the factuality, accuracy and completeness of the contents of
this Report and its summary, and shall be jointly and severally liable for any
misrepresentations, misleading statements or material omissions therein.
All the Company’s directors have attended the Board meeting for the review of this Report
and its summary.
Liu Zibin, the Company’s legal representative, Zhang Hongmei, the Company’s Chief
Accountant, and Zhang Keming, the Company’s Financial Manager hereby guarantee that
the Financial Statements carried in this Report are factual, accurate and complete.
This Report and its summary have been prepared in both Chinese and English. Should there
be any discrepancies or misunderstandings between the two versions, the Chinese versions
shall prevail.
Lu Thai Textile Co., Ltd. First Quarter Report 2019
Part II Key Corporate Information
I Key Financial Information
Indicate by tick mark whether there is any retrospectively restated datum in the table below.
□ Yes √ No
Q1 2019 Q1 2018 Change (%)
Operating revenue (RMB) 1,545,153,566.09 1,519,803,691.24 1.67%
Net profit attributable to the listed company’s shareholders
195,173,391.82 159,278,371.57 22.54%
(RMB)
Net profit attributable to the listed company’s shareholders
175,390,785.73 138,044,830.06 27.05%
before exceptional items (RMB)
Net cash generated from/used in operating activities (RMB) -89,714,180.16 84,118,827.13 -206.65%
Basic earnings per share (RMB/share) 0.23 0.17 35.29%
Diluted earnings per share (RMB/share) 0.23 0.17 35.29%
Weighted average return on equity (%) 2.69% 2.18% 0.51%
31 March 2019 31 December 2018 Change (%)
Total assets (RMB) 10,858,794,197.15 10,537,759,811.84 3.05%
Equity attributable to the listed company’s shareholders
7,324,049,365.93 7,146,548,467.86 2.48%
(RMB)
Exceptional gains and losses:
√ Applicable □ Not applicable
Unit: RMB
Item Q1 2019 Note
Gain or loss on disposal of non-current assets (inclusive of impairment allowance write-offs) -12,249.61
Government subsidies charged to current profit or loss (exclusive of government subsidies
given in the Company’s ordinary course of business at fixed quotas or amounts as per the 20,199,549.00
government’s uniform standards)
Gain or loss on fair-value changes in trading financial assets and liabilities, as well as
derivative financial assets and liabilities & income from disposal of trading financial assets and
liabilities, derivative financial assets and liabilities, as well as investments in other debt 5,061,486.85
obligations (exclusive of effective portion of hedges that arise in the Company’s ordinary
course of business)
Non-operating income and expense other than the above 213,423.07
Less: Income tax effects 3,285,535.34
Non-controlling interests effects (net of tax) 2,394,067.88
Lu Thai Textile Co., Ltd. First Quarter Report 2019
Total 19,782,606.09 --
Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item defined or listed in the Explanatory
Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Exceptional Gain/Loss
Items:
□ Applicable √ Not applicable
No such cases for the Reporting Period.
II Total Number of Shareholders and Holdings of Top 10 Shareholders at 31 March 2019
1. Numbers of Ordinary Shareholders and Preferred Shareholders with Resumed Voting Rights as well as
Holdings of Top 10 Shareholders
Unit: share
Number of ordinary shareholders at Number of preferred shareholders with resumed voting rights at
55,250
the period-end the period-end (if any)
Top 10 shareholders
Shareholdi Shares in pledge or
Nature of Total shares Restricted
Name of shareholder ng frozen
shareholder held shares held
percentage Status Shares
Domestic
Zibo Lucheng Textile Investment Co., Ltd. non-state-owned 15.21% 140,353,583
legal person
Foreign legal
Tailun (Thailand) Textile Co., Ltd. 12.82% 118,232,400 118,232,400
person
Foreign legal
Hong Kong Securities Clearing Co. Ltd 3.23% 29,821,256
person
State-owned legal
Central Huijin Assets Management Co., Ltd. 2.20% 20,315,300
person
Foreign legal
T.ROWE PRICE INTL DISCOVERY FUND 2.16% 19,948,219
person
China Securities Finance Corporation Limited Other 1.98% 18,313,391
Foreign legal
Hong Kong Monetary Authority 1.77% 16,365,164
person
National Social Security Fund Portfolio 103 Other 1.08% 9,999,947
RBC EMERGING MARKETS SMALL CAP Foreign legal
0.65% 6,033,062
EQUITY FUND person
First State Investments Management (UK) Foreign legal
0.59% 5,444,048
Co., Ltd. person
Top 10 unrestricted shareholders
Lu Thai Textile Co., Ltd. First Quarter Report 2019
Shares by type
Name of shareholder Unrestricted shares held
Type Shares
RMB-denominate
Zibo Lucheng Textile Investment Co., Ltd. 140,353,583 140,353,583
d ordinary stock
RMB-denominate
Hong Kong Securities Clearing Co. Ltd 29,821,256 29,821,256
d ordinary stock
RMB-denominate
Central Huijin Assets Management Co., Ltd. 20,315,300 20,315,300
d ordinary stock
Domestically
T.ROWE PRICE INTL DISCOVERY FUND 19,948,219 listed foreign 19,948,219
stock
RMB-denominate
China Securities Finance Corporation Limited 18,313,391 18,313,391
d ordinary stock
RMB-denominate
Hong Kong Monetary Authority 16,365,164 16,365,164
d ordinary stock
RMB-denominate
National Social Security Fund Portfolio 103 9,999,947 9,999,947
d ordinary stock
Domestically
RBC EMERGING MARKETS SMALL CAP EQUITY FUND 6,033,062 listed foreign 6,033,062
stock
RMB-denominate
First State Investments Management (UK) Co., Ltd. 5,444,048 5,444,048
d ordinary stock
Domestically
FORENINGEN AP INVEST F.M.B.A. 5,398,839 listed foreign 5,398,839
stock
Zibo Lucheng Textile Investment Co., Ltd. is the largest
shareholder of the Company and the actual controller. Tailun
(Thailand) Textile Co., Ltd. is the second largest shareholder as
Related or acting-in-concert parties among the shareholders well as sponsor of foreign capital of the Company. All of other
above shareholders are people holding public A share or public B share
and the Company is not able to confirm whether there is
associated relationship or concerted action among other
shareholders.
Top 10 ordinary shareholders involved in securities margin
Naught
trading (if any)
Indicate by tick mark whether any of the top 10 ordinary shareholders or the top 10 unrestricted ordinary shareholders of the
Company conducted any promissory repo during the Reporting Period.
□ Yea √ No
No such cases in the Reporting Period.
Lu Thai Textile Co., Ltd. First Quarter Report 2019
2. Number of Preferred Shareholders and Shareholdings of Top 10 of Them
□ Applicable √ Not applicable
Lu Thai Textile Co., Ltd. First Quarter Report 2019
Part III Significant Events
I Changes in Key Financial Statement Line Items and Explanation of why
√ Applicable □ Not applicable
Unit: RMB
Item 31 March 2019 31 December 2018 Change Reason for change
Prepayments 278,788,371.55 149,582,616.21 86.38% Increase in prepayments for raw materials
Decrease in receivable export tax rebates
and recovery of some advances for
Other
33,769,400.99 63,012,001.10 -46.41% agricultural means of production during
receivables
Q1 2019 by Xinjiang Luthai Fengshou
Cotton Industry Co., Ltd.
Current portion Purchase of wealth management products
of non-current 50,261,580.38 - 100.00% of AVIC TRUST by the Company as the
assets parent during Q1 2019
Other
Increase in prepayment for land lease by
non-current 68,330,830.51 43,100,215.87 58.54%
Lu Thai (Vietnam) Textile Co., Ltd.
assets
Payroll payable 200,183,479.23 325,998,210.17 -38.59% Payment of 2018 year-end bonus
Payment of enterprise income tax by the
Taxes payable 21,864,508.35 43,556,823.75 -49.80% Company as the parent during the Q1
Item Q1 2019 Q1 2018 Change Reason for change
Selling expense 39,973,056.09 30,483,720.76 31.13% Increase in sales service charges
Increase in operating government
Other income 20,199,549.00 13,538,655.19 49.20%
subsidies received in Q1 2019
Investment Increase in losses on investment in
-93,250.75 2,439,952.13 -103.82%
income derivative financial instruments
Decrease in gains on changes in fair value
Gain on changes or fails-to-delivery forward foreign
5,108,600.00 7,895,000.00 -35.29%
in fair value exchange settlement and options at the
period-end
Asset disposal
-4,492.87 -300,994.82 98.51% Decrease in losses on fixed asset disposal
income
Lu Thai Textile Co., Ltd. First Quarter Report 2019
Income tax
37,131,437.89 27,669,680.25 34.20% Increase in Profit before tax
expense
II Progress, Influence and Solutions with regard to Significant Events
□ Applicable √ Not applicable
Progress of any share repurchase:
√ Applicable □ Not applicable
The Company held the 2nd Extraordinary General Meeting of 2018 on 23 March 2018, on which, the Proposal on Repurchase of
Some B-Shares of the Company was reviewed and approved. For details, please refer to the announcement (announcement No.:
2018-013) disclosed on www.cninfo.com.cn on 24 March 2018. The Company disclosed the Report on Repurchase of Some
B-Shares of the Company on 16 May 2018 and particulars about the first share repurchase in the Announcement on Implementation of
Repurchase of B-Shares of Lu Thai Textile Co., Ltd. published on 29 May 2018. As of 22 March 2019, the repurchase term has
expired and the accumulative B-shares repurchased were 64,480,770 which have been cancelled completely at CSDCC Shenzhen on
4 April 2019. The total share capital of the Company now is decreased to 858,121,541. For details, please refer to the two
announcements (announcement No.: 2019-013, announcement No.: 2019-023) respectively disclosed on 23 March 2019 and 9 April
2019.
Progress of any reduction of the repurchased shares through centralized bidding:
□ Applicable √ Not applicable
III Commitments that the Company’s Actual Controller, Shareholders, Related Parties,
Acquirers, the Company Itself or Other Parties, Failed to Fulfill on Time during the
Reporting Period
□ Applicable √ Not applicable
No such cases in the Reporting Period.
IV Operating Performance Forecast for H1 2019
Warning of a forecast loss on or a forecast significant year-on-year change in the net profit of H1 2019, as well as explanation of
why:
□ Applicable √ Not applicable
V Securities Investments
□ Applicable √ Not applicable
No such cases in the Reporting Period.
VI Investments in Derivative Financial Instruments
√ Applicable □ Not applicable
Unit: RMB'0,000
Lu Thai Textile Co., Ltd. First Quarter Report 2019
Proportion
Rela Rela
Endin of closing
tions ted- Impairm Actual
Purchased g investment
hip part Type of Initial Beginning Sold in the ent gain/loss
Operat Starting Ending in the invest amount in
with y derivativ investment investment Reporting provisio in the
or date date Reporting ment the
the trans e amount amount Period n (if Reportin
Period amoun Company’
Com actio any) g Period
t s ending
pany n
net assets
Forward
Comm Non- exchang
19 June 7 March
ercial relat No e 25,089.2 6,512.05 18,577.15 25,089.2 0 0.00% -196.97
2018 2019
bank ed settleme
nt
Comm Non- Foreign
23 March 28 March
ercial relat No exchang 3,922.86 1,909.89 2,012.97 3,922.86 0 0.00% -140.28
2018 2019
bank ed e option
Forward
Comm Non- exchang
8 March 30 April
ercial relat No e 2,637.88 1,610.11 1,027.77 2,028.78 609.1 0.08% 53.27
2018 2019
bank ed transacti
ons
Total 31,649.94 -- -- 10,032.05 21,617.89 31,040.84 609.1 0.08% -283.98
Capital source for derivative
The Company’s own money
investment
Lawsuit (if applicable) Naught
Disclosure date of board of
directors announcement on
27 April 2018
approval of derivative
investment (if any)
Disclosure date of general
meeting of shareholders
announcement on approval
of derivative investment (if
any)
Analysis on risks and The Company conducted derivatives products transaction in order for hedging. And the forward settlement
control measures of hedging was operated by installments, with the relevant amount not more than the planned derivatives
derivative products held in products transactions. And all derivatives products transaction was zero-deposit. Meanwhile, the Company
the Reporting Period had a complete risk control system for sufficient analysis and prevention of possible risks such as market
(including but not limited to risk, liquidity risk and credit risk, operation risk and risk of laws and regulation.
market risk, liquidity risk, 1. Market risk: when the international and domestic economic situations change, the corresponding changes
credit risk, operation risk, in exchange rates and interest rates may have an adverse impact on the financial derivatives transactions of
law risk, etc.) the Company. Precautionary measures to be taken include: the Company chooses risk-controlled financial
Lu Thai Textile Co., Ltd. First Quarter Report 2019
derivative tools with simple structure and good liquidity to carry out the hedging business, strictly controls
the scale of financial derivatives trading by staged operations, and adjusts the strategy according to market
changes in a timely manner.
2. Liquidity risk and credit risk: a credit risk arising from failure of the contractually due Company or
counterparty in performing the contract due to liquidity or factors other than liquidity. Precautionary
measures to be taken include: the Company determines the upper limit of derivatives transaction amounts
according to production and operation scale as well as foreign exchange income, and conducts operations by
stage according to the budget of future collections and disbursement. The derivative trades are free of
guarantee deposit and can still be guaranteed in performance after the contract expires by means of extension
and balance settlement etc. to prevent the Company from credit damages due to lack of liquidity. The
Company selects financial institutions with strong capability and good reputation as a counterparty and signs
standard derivative trading contracts to strictly control credit risk of the counterparty.
3. Operation risk:
The derivatives had high specialty and complexity, so imperfect internal operation procedures, staffs and
external events would make the Company to undertake risks during the transaction. Risk control measures:
The Company promulgated strict authorization and approval system and perfect regulatory mechanism, fixed
the operation procedures and approval procedures system to conduct derivative products transaction,
implemented strict authorization and post checks and balances system, meanwhile, it improved the overall
quality of relevant personnel through strengthening the professional ethics education and business training
for them. Besides, it established the System of Reporting the Abnormal Situation Timely so as to ensure to
lower the operation risks to the maximum.
4. Risk of laws and regulation:
The Company conducted derivatives products transaction in strict accordance with relevant laws and rules. If
there were no standard operation procedures and strict approval procedures, it was easy to cause compliant
and regulatory risks existing in the validity and feasibility of contract, commitments and other legal
documents signed. Risk control measures: The Company carefully studied and mastered laws, regulations
and policies relevant to derivative products transaction, formulated internal control rules for the forward
settlement hedging business, standardized the operation procedures. And strengthened the compliant
examination on derivative products transaction business. The Company conducted derivative transaction
business according to the relevant approval procedure, which was in line with relevant laws, regulations, the
Company’s Articles of Association, the Management Rules for Derivative Transaction of Lu Thai Textile
Co., Ltd. and the Proposal on the Plan of Lu Thai Textile Co., Ltd. for Derivative Transactions approved at
the 17th Meeting of the 8th Board of Directors on 25 April 2018, and performed relevant information
disclosure responsibilities.
Changes of market prices or 1. As of 31 March 2019, the Company held one undue financial derivatives contracts, totaling USD0.908
fair values in the Reporting million, which was the forward exchange transaction; The contract expires by April 2019 at the latest.
Period of the invested Financial derivatives accounted for 0.08% of net assets at the end of the period.
derivatives. And the analysis 2. In January - March 2019, the amount of maturing financial derivatives of the Company amounted to USD
on the fair value of the 46,462,800 which was executed as per the contract in full, which generated a loss of RMB2,839,800. The
derivatives should include amount of maturing settlements of exchange in the long term amounted to USD37.5 million which generated
the specific use methods and a loss of RMB1,969,700; the amount of maturing foreign exchange options was USD6 million which
the relevant assumptions generated a loss of RMB1,402,800. The amount of maturing exchange transaction amounted to
and parameters. USD2,962,800 which generated an income of RMB532,700.
Lu Thai Textile Co., Ltd. First Quarter Report 2019
Whether significant changes
occurred to the Company’s
accounting policy and
specific accounting
No significant changes
principles of derivatives in
the Reporting Period
compared to the previous
Reporting Period
The Company’s independent directors Zhou Zhiji, Zhao Yao, Bi Xiuli, Pan Ailing and Wang Xinyu,
concerning conducting derivatives business, have issued the following professional advice: We are of the
Specific opinion from opinion that it will strengthen the Company’s competitiveness to use derivative transactions with focus on
independent directors on the forward settlement and purchase as an effective tool to avoid foreign exchange risks, to strengthen the
Company’s derivatives relevant internal control and to carry out the loss and risk prevention measures so as to improve the operation
investment and risk control and management. In conducting derivative transactions with focus on forward settlement and purchase, the
Company follows a legal approval procedure, has sound relevant institutions and keeps the risks relatively
controllable. No harm has been done to the interests of the Company’s shareholders.
VII Communications with the Investment Community such as Researches, Inquiries and
Interviews during the Reporting Period
√ Applicable □ Not applicable
Type of communication Index to main information
Date Way of communication
party communicated
29 March 2019 By phone Individual Basic information of the Company
VIII Irregularities in the Provision of Guarantees
□ Applicable √ Not applicable
No such cases in the Reporting Period.
IX Occupation of the Company’s Capital by the Controlling Shareholder or Its Related
Parties for Non-Operating Purposes
□ Applicable √ Not applicable
No such cases in the Reporting Period.
Lu Thai Textile Co., Ltd. First Quarter Report 2019
Part IV Financial Statements
I Financial Statements
1. Consolidated Balance Sheet
Prepared by Lu Thai Textile Co., Ltd.
31 March 2019
Unit: RMB
Item 31 March 2019 31 December 2018
Current assets:
Monetary capital 538,479,435.51 545,502,709.36
Trading financial assets 30,972,000.00
Financial assets at fair value through profit or loss
Derivative financial assets
Notes and accounts receivable 541,772,210.22 549,265,034.81
Including: Notes receivable 109,925,824.66 174,657,918.26
Accounts receivable 431,846,385.56 374,607,116.55
Prepayments 278,788,371.55 149,582,616.21
Other receivables 33,769,400.99 63,012,001.10
Including: Interest receivable
Dividends receivable
Financial assets purchased under resale agreements
Inventories 2,230,389,578.14 2,093,366,992.30
Contractual assets
Assets classified as held for sale
Current portion of non-current assets 50,261,580.38
Other current assets 79,442,182.89 86,366,454.56
Total current assets 3,783,874,759.68 3,487,095,808.34
Non-current assets:
Available-for-sale financial assets 85,112,000.00
Investments in other debt obligations
Held-to-maturity investments
Long-term receivables 9,648,298.10 10,693,844.75
Lu Thai Textile Co., Ltd. First Quarter Report 2019
Long-term equity investments 95,554,809.90 96,018,463.65
Investments in other equity instruments 12,000,000.00
Other non-current financial assets 31,018,515.95
Investment property 21,686,016.20 22,880,242.95
Fixed assets 5,789,600,038.26 5,748,562,385.35
Construction in progress 339,361,863.03 337,230,646.42
Right-of-use assets
Intangible assets 482,975,515.53 478,689,064.45
R&D expense
Goodwill 20,563,803.29 20,613,803.29
Long-term prepaid expense 116,811,767.31 119,126,407.71
Deferred income tax assets 87,367,979.39 88,636,929.06
Other non-current assets 68,330,830.51 43,100,215.87
Total non-current assets 7,074,919,437.47 7,050,664,003.50
Total assets 10,858,794,197.15 10,537,759,811.84
Current liabilities:
Short-term borrowings 1,710,887,864.90 1,325,273,780.05
Trading financial liabilities
Financial liabilities at fair value through profit or loss 4,877,600.00
Derivative financial liabilities
Notes and accounts payable 281,328,360.49 353,688,510.95
Advances from customers 81,675,829.78 105,562,378.66
Payroll payable 200,183,479.23 325,998,210.17
Taxes payable 21,864,508.35 43,556,823.75
Other payables 213,357,425.53 215,946,987.68
Including: Interest payable 1,823,793.34 3,068,841.54
Dividends payable 441,113.64 441,113.64
Liabilities directly associated with assets classified as held
for sale
Current portion of non-current liabilities
Other current liabilities
Total current liabilities 2,509,297,468.28 2,374,904,291.26
Non-current liabilities:
Insurance contract reserve
Long-term borrowings 176,649,161.23 170,019,083.89
Lu Thai Textile Co., Ltd. First Quarter Report 2019
Lease liabilities
Long-term payables
Long-term payroll payable 96,958,178.53 96,958,178.53
Provisions
Deferred income 140,663,318.17 140,183,446.39
Deferred income tax liabilities 27,754,915.94 28,030,096.38
Other non-current liabilities 1,840,000.00 1,840,000.00
Total non-current liabilities 443,865,573.87 437,030,805.19
Total liabilities 2,953,163,042.15 2,811,935,096.45
Owners’ equity:
Share capital 922,602,311.00 922,602,311.00
Other equity instruments
Including: Preferred shares
Perpetual bonds
Capital reserves 699,493,647.48 699,493,647.48
Less: Treasury stock 507,111,339.04 486,922,944.94
Other comprehensive income 63,060,913.72 61,157,013.37
Special reserves
Surplus reserves 1,022,717,451.40 1,022,717,451.40
General reserve
Retained earnings 5,123,286,381.37 4,927,500,989.55
Total equity attributable to owners of the Company as the
7,324,049,365.93 7,146,548,467.86
parent
Non-controlling interests 581,581,789.07 579,276,247.53
Total owners’ equity 7,905,631,155.00 7,725,824,715.39
Total liabilities and owners’ equity 10,858,794,197.15 10,537,759,811.84
Legal representative: Liu Zibin The Company’s chief accountant: Zhang Hongmei
The Company’s financial manager: Zhang Keming
2. Balance Sheet of the Company as the Parent
Unit: RMB
Item 31 March 2019 31 December 2018
Current assets:
Monetary capital 319,391,672.74 191,305,104.80
Lu Thai Textile Co., Ltd. First Quarter Report 2019
Trading financial assets 30,972,000.00
Financial assets at fair value through profit or loss
Derivative financial assets
Notes and accounts receivable 419,636,055.65 407,781,221.62
Including: Notes receivable 66,515,625.80 91,555,248.34
Accounts receivable 353,120,429.85 316,225,973.28
Prepayments 188,095,486.15 115,020,260.51
Other receivables 383,532,060.83 395,847,213.77
Including: Interest receivable
Dividends receivable
Inventories 1,227,842,173.03 1,040,433,078.53
Contractual assets
Assets classified as held for sale
Current portion of non-current assets 50,261,580.38
Other current assets 11,446,884.77 12,671,631.64
Total current assets 2,631,177,913.55 2,163,058,510.87
Non-current assets:
Investments in debt obligations
Available-for-sale financial assets 73,112,000.00
Investments in other debt obligations
Held-to-maturity investments
Long-term receivables
Long-term equity investments 2,232,449,925.94 2,165,711,579.69
Investments in other equity instruments
Other non-current financial assets 31,018,515.95
Investment property 14,621,498.88 14,804,592.72
Fixed assets 2,728,416,151.75 2,731,726,695.28
Construction in progress 44,468,537.11 61,182,771.86
Right-of-use assets
Intangible assets 240,229,901.63 242,204,032.54
R&D expense
Goodwill
Long-term prepaid expense
Deferred income tax assets 50,493,439.44 52,758,961.05
Lu Thai Textile Co., Ltd. First Quarter Report 2019
Other non-current assets 6,372,220.90 6,047,443.10
Total non-current assets 5,348,070,191.60 5,347,548,076.24
Total assets 7,979,248,105.15 7,510,606,587.11
Current liabilities:
Short-term borrowings 804,969,880.02 622,604,447.52
Trading financial liabilities
Financial liabilities at fair value through profit or loss 4,877,600.00
Derivative financial liabilities
Notes and accounts payable 391,096,317.43 120,141,727.66
Advances from customers 49,871,794.52 49,798,551.14
Contractual liabilities
Payroll payable 150,291,903.61 240,090,943.88
Taxes payable 8,137,836.98 30,914,089.32
Other payables 301,321,888.56 303,672,590.72
Including: Interest payable 1,793,887.09 2,475,549.88
Dividends payable 441,113.64 441,113.64
Liabilities directly associated with assets classified as held
for sale
Current portion of non-current liabilities
Other current liabilities
Total current liabilities 1,705,689,621.12 1,372,099,950.24
Non-current liabilities:
Long-term borrowings
Lease liabilities
Long-term payables
Long-term payroll payable 96,958,178.53 96,958,178.53
Provisions
Deferred income 94,945,410.11 94,390,844.09
Deferred income tax liabilities 16,607,730.43 16,699,530.43
Other non-current liabilities
Total non-current liabilities 208,511,319.07 208,048,553.05
Total liabilities 1,914,200,940.19 1,580,148,503.29
Owners’ equity:
Share capital 922,602,311.00 922,602,311.00
Other equity instruments
Lu Thai Textile Co., Ltd. First Quarter Report 2019
Including: Preferred shares
Perpetual bonds
Capital reserves 759,836,756.57 759,836,756.57
Less: Treasury stock 507,111,339.04 486,922,944.94
Other comprehensive income 18,054,862.20 520,200.00
Special reserves
Surplus reserves 1,019,608,711.76 1,019,608,711.76
Retained earnings 3,852,055,862.47 3,714,813,049.43
Total owners’ equity 6,065,047,164.96 5,930,458,083.82
Total liabilities and owners’ equity 7,979,248,105.15 7,510,606,587.11
3. Consolidated Income Statement
Unit: RMB
Item Q1 2019 Q1 2018
1. Revenue 1,545,153,566.09 1,519,803,691.24
Including: Operating revenue 1,545,153,566.09 1,519,803,691.24
2. Costs and expenses 1,335,959,266.55 1,350,782,281.17
Including: Cost of sales 1,073,032,409.07 1,085,683,246.68
Taxes and surcharges 21,952,729.62 27,882,652.80
Selling expense 39,973,056.09 30,483,720.76
Administrative expense 87,221,760.41 78,629,472.18
R&D expense 79,919,113.90 85,054,395.89
Finance costs 30,901,482.17 43,774,185.06
Including: Interest expense 20,172,898.97 10,069,958.48
Interest income 1,277,162.22 3,254,879.53
Asset impairment loss 441,007.21 -725,392.20
Credit impairment loss 2,517,708.08
Add: Other income 20,199,549.00 13,538,655.19
Return on investment (“-” for loss) -93,250.75 2,439,952.13
Including: Share of profit or loss of joint ventures and
-56,232.67
associates
Foreign exchange gain (“-” for loss)
Net gain on exposure hedges (“-” for loss)
Gain on changes in fair value (“-” for loss) 5,108,600.00 7,895,000.00
Asset disposal income (“-” for loss) -4,492.87 -300,994.82
Lu Thai Textile Co., Ltd. First Quarter Report 2019
3. Operating profit (“-” for loss) 234,404,704.92 192,594,022.57
Add: Non-operating income 1,330,325.06 1,178,816.47
Less: Non-operating expense 1,124,658.73 1,054,317.03
4. Profit before tax (“-” for loss) 234,610,371.25 192,718,522.01
Less: Income tax expense 37,131,437.89 27,669,680.25
5. Net profit (“-” for net loss) 197,478,933.36 165,048,841.76
5.1 By operating continuity
5.1.1 Net profit from continuing operations (“-” for net
197,478,933.36 165,048,841.76
loss)
5.1.2 Net profit from discontinued operations (“-” for net
loss)
5.2 By ownership
5.2.1 Net profit attributable to owners of the Company as
195,173,391.82 159,278,371.57
the parent
5.2.1 Net profit attributable to non-controlling interests 2,305,541.54 5,770,470.19
6. Other comprehensive income, net of tax -15,630,761.85 -21,450,491.60
Attributable to owners of the Company as the parent -15,630,761.85 -21,450,491.60
6.1 Items that will not be reclassified to profit or loss
6.1.1 Changes caused by remeasurements on defined
benefit pension schemes
6.1.2 Other comprehensive income that will not be
reclassified to profit or loss under the equity method
6.1.3 Changes in the fair value of investments in other
equity instruments
6.1.4 Changes in the fair value of the company’s credit
risks
6.1.5 Other
6.2 Items that will be reclassified to profit or loss -15,630,761.85 -21,450,491.60
6.2.1 Other comprehensive income that will be
reclassified to profit or loss under the equity method
6.2.2 Changes in the fair value of investments in other
debt obligations
6.2.3 Gain/Loss on changes in the fair value of
504,900.00
available-for-sale financial assets
6.2.4 Other comprehensive income arising from the
reclassification of financial assets
6.2.5 Gain/Loss arising from the reclassification of
held-to-maturity investments to available-for-sale financial
assets
Lu Thai Textile Co., Ltd. First Quarter Report 2019
6.2.6 Allowance for credit impairments in investments
in other debt obligations
6.2.7 Reserve for cash flow hedges
6.2.8 Differences arising from the translation of foreign
-15,630,761.85 -21,955,391.60
currency-denominated financial statements
6.2.9 Other
Attributable to non-controlling interests
7. Total comprehensive income 181,848,171.51 143,598,350.16
Attributable to owners of the Company as the parent 179,542,629.97 137,827,879.97
Attributable to non-controlling interests 2,305,541.54 5,770,470.19
8. Earnings per share
8.1 Basic earnings per share 0.23 0.17
8.2 Diluted earnings per share 0.23 0.17
Where business combinations under common control occurred in the current period, the net profit achieved by the acquirees before
the combinations was RMB0.00, with the amount for the same period of last year being RMB0.00.
Legal representative: Liu Zibin The Company’s chief accountant: Zhang Hongmei
The Company’s financial manager: Zhang Keming
4. Income Statement of the Company as the Parent
Unit: RMB
Item Q1 2019 Q1 2018
1. Operating revenue 1,218,013,159.80 1,162,007,070.65
Less: Cost of sales 914,084,322.63 871,297,002.70
Taxes and surcharges 14,774,890.71 21,573,452.57
Selling expense 24,925,715.73 17,199,119.93
Administrative expense 54,428,690.80 53,488,083.23
R&D expense 53,869,453.01 59,162,936.09
Finance costs 6,406,772.73 22,144,987.67
Including: Interest expense 6,261,332.41 2,010,358.64
Interest income 520,856.66 1,411,026.60
Asset impairment loss 1,683,200.50
Credit impairment loss 1,588,230.27
Add: Other income 11,532,089.34 8,568,738.83
Return on investment (“-” for loss) -1,534,961.26 1,461,867.85
Lu Thai Textile Co., Ltd. First Quarter Report 2019
Including: Share of profit or loss of joint ventures and
-56,232.67
associates
Net gain on exposure hedges (“-” for loss)
Gain on changes in fair value (“-” for loss) 5,108,600.00 6,736,100.00
Asset disposal income (“-” for loss) -19,705.25 -8,943,719.11
2. Operating profit (“-” for loss) 163,021,106.75 123,281,275.53
Add: Non-operating income 1,009,494.98 899,417.77
Less: Non-operating expense 422,145.43 335,839.31
3. Profit before tax (“-” for loss) 163,608,456.30 123,844,853.99
Less: Income tax expense 26,977,643.26 19,283,743.91
4. Net profit (“-” for net loss) 136,630,813.04 104,561,110.08
4.1 Net profit from continuing operations (“-” for net loss) 136,630,813.04 104,561,110.08
4.2 Net profit from discontinued operations (“-” for net loss)
5. Other comprehensive income, net of tax 504,900.00
5.1 Items that will not be reclassified to profit or loss
5.1.1 Changes caused by remeasurements on defined
benefit pension schemes
5.1.2 Other comprehensive income that will not be
reclassified to profit or loss under the equity method
5.1.3 Changes in the fair value of investments in other
equity instruments
5.1.4 Changes in the fair value of the company’s credit
risks
5.1.5 Other
5.2 Items that will be reclassified to profit or loss 504,900.00
5.2.1 Other comprehensive income that will be reclassified
to profit or loss under the equity method
5.2.2 Changes in the fair value of investments in other debt
obligations
5.2.3 Gain/Loss on changes in the fair value of
504,900.00
available-for-sale financial assets
5.2.4 Other comprehensive income arising from the
reclassification of financial assets
5.2.5 Gain/Loss arising from the reclassification of
held-to-maturity investments to available-for-sale financial
assets
5.2.6 Allowance for credit impairments in investments in
other debt obligations
5.2.7 Reserve for cash flow hedges
Lu Thai Textile Co., Ltd. First Quarter Report 2019
5.2.8 Differences arising from the translation of foreign
currency-denominated financial statements
5.2.9 Other
6. Total comprehensive income 136,630,813.04 105,066,010.08
7. Earnings per share
7.1 Basic earnings per share 0.16 0.11
7.2 Diluted earnings per share 0.16 0.11
5. Consolidated Cash Flow Statement
Unit: RMB
Item Q1 2019 Q1 2018
1. Cash flows from operating activities:
Proceeds from sale of commodities and rendering of services 1,494,044,826.59 1,481,659,910.33
Tax rebates 55,121,275.16 70,407,971.68
Cash generated from other operating activities 27,635,093.30 37,904,123.48
Subtotal of cash generated from operating activities 1,576,801,195.05 1,589,972,005.49
Payments for commodities and services 1,012,742,338.01 860,039,261.70
Cash paid to and for employees 497,105,229.34 496,773,800.61
Taxes paid 93,875,522.94 68,934,998.71
Cash used in other operating activities 62,792,284.92 80,105,117.34
Subtotal of cash used in operating activities 1,666,515,375.21 1,505,853,178.36
Net cash generated from/used in operating activities -89,714,180.16 84,118,827.13
2. Cash flows from investing activities:
Proceeds from disinvestment 30,000,000.00
Return on investment 2,402,138.74
Net proceeds from the disposal of fixed assets, intangible assets and
16,868.25 544,564.38
other long-lived assets
Net proceeds from the disposal of subsidiaries and other business
units
Cash generated from other investing activities 2,769,450.30 4,259,032.24
Subtotal of cash generated from investing activities 35,188,457.29 4,803,596.62
Payments for the acquisition of fixed assets, intangible assets and
264,858,846.65 112,575,998.71
other long-lived assets
Payments for investments 50,000,000.00
Net increase in pledged loans granted
Net payments for the acquisition of subsidiaries and other business
units
Lu Thai Textile Co., Ltd. First Quarter Report 2019
Cash used in other investing activities 4,807,200.00
Subtotal of cash used in investing activities 319,666,046.65 112,575,998.71
Net cash generated from/used in investing activities -284,477,589.36 -107,772,402.09
3. Cash flows from financing activities:
Capital contributions received 500,000.00
Including: Capital contributions by non-controlling interests to
500,000.00
subsidiaries
Borrowings obtained 1,227,747,399.37 736,133,783.53
Net proceeds from the issuance of bonds
Cash generated from other financing activities 10,000,000.00 21,300,000.00
Subtotal of cash generated from financing activities 1,237,747,399.37 757,933,783.53
Repayments of borrowings 818,989,136.72 484,376,409.32
Payments for interest and dividends 23,656,295.67 9,855,785.25
Including: Dividends paid by subsidiaries to non-controlling
interests
Cash used in other financing activities 12,862,424.99
Subtotal of cash used in financing activities 855,507,857.38 494,232,194.57
Net cash generated from/used in financing activities 382,239,541.99 263,701,588.96
4. Effect of foreign exchange rate changes on cash and cash equivalents -5,071,046.32 -7,731,641.43
5. Net increase in cash and cash equivalents 2,976,726.15 232,316,372.57
Add: Cash and cash equivalents, beginning of the period 535,134,772.90 676,639,212.86
6. Cash and cash equivalents, end of the period 538,111,499.05 908,955,585.43
6. Cash Flow Statement of the Company as the Parent
Unit: RMB
Item Q1 2019 Q1 2018
1. Cash flows from operating activities:
Proceeds from sale of commodities and rendering of services 1,188,755,766.98 1,402,617,102.18
Tax rebates 39,801,136.87 49,708,933.68
Cash generated from other operating activities 12,674,765.62 15,058,269.35
Subtotal of cash generated from operating activities 1,241,231,669.47 1,467,384,305.21
Payments for commodities and services 684,174,487.67 917,764,028.02
Cash paid to and for employees 346,747,962.03 358,009,124.41
Taxes paid 64,735,924.66 44,479,611.73
Cash used in other operating activities 40,577,138.22 31,339,072.23
Subtotal of cash used in operating activities 1,136,235,512.58 1,351,591,836.39
Lu Thai Textile Co., Ltd. First Quarter Report 2019
Net cash generated from/used in operating activities 104,996,156.89 115,792,468.82
2. Cash flows from investing activities:
Proceeds from disinvestment 30,000,000.00
Return on investment 2,402,138.74
Net proceeds from the disposal of fixed assets, intangible assets and
64,995,332.71
other long-lived assets
Net proceeds from the disposal of subsidiaries and other business
units
Cash generated from other investing activities 67,060,381.68 244,162,209.77
Subtotal of cash generated from investing activities 99,462,520.42 309,157,542.48
Payments for the acquisition of fixed assets, intangible assets and
50,596,052.64 43,650,645.56
other long-lived assets
Payments for investments 117,202,000.00 256,206,500.00
Net payments for the acquisition of subsidiaries and other business
units
Cash used in other investing activities 75,781,620.00 167,497,600.00
Subtotal of cash used in investing activities 243,579,672.64 467,354,745.56
Net cash generated from/used in investing activities -144,117,152.22 -158,197,203.08
3. Cash flows from financing activities:
Capital contributions received
Borrowings obtained 790,254,327.80 475,339,258.78
Net proceeds from the issuance of bonds
Cash generated from other financing activities
Subtotal of cash generated from financing activities 790,254,327.80 475,339,258.78
Repayments of borrowings 599,478,751.52 283,270,165.87
Payments for interest and dividends 9,592,279.88 4,169,374.27
Cash used in other financing activities 12,862,424.99
Subtotal of cash used in financing activities 621,933,456.39 287,439,540.14
Net cash generated from/used in financing activities 168,320,871.41 187,899,718.64
4. Effect of foreign exchange rate changes on cash and cash equivalents -1,113,308.14 -2,410,353.03
5. Net increase in cash and cash equivalents 128,086,567.94 143,084,631.35
Add: Cash and cash equivalents, beginning of the period 191,305,104.80 267,809,829.78
6. Cash and cash equivalents, end of the period 319,391,672.74 410,894,461.13
Lu Thai Textile Co., Ltd. First Quarter Report 2019
II Adjustments to the Financial Statements
1. Adjustments to the Financial Statements at the Beginning of the First Execution Year of any New
Standards Governing Financial Instruments, Revenue or Leases
√ Applicable □ Not applicable
Consolidated Balance Sheet
Unit: RMB
Item 31 December 2018 1 January 2019 Adjusted
Current assets:
Monetary capital 545,502,709.36 545,502,709.36
Trading financial assets N/A 60,612,000.00 60,612,000.00
Notes and accounts receivable 549,265,034.81 549,265,034.81
Including: Notes receivable 174,657,918.26 174,657,918.26
Accounts receivable 374,607,116.55 374,607,116.55
Prepayments 149,582,616.21 149,582,616.21
Other receivables 63,012,001.10 63,012,001.10
Inventories 2,093,366,992.30 2,093,366,992.30
Other current assets 86,366,454.56 86,366,454.56
Total current assets 3,487,095,808.34 3,547,707,808.34 60,612,000.00
Non-current assets:
Available-for-sale financial assets 85,112,000.00 N/A -85,112,000.00
Long-term receivables 10,693,844.75 10,693,844.75
Long-term equity investments 96,018,463.65 95,554,809.90 -463,653.75
Investments in other equity instruments N/A 12,000,000.00 12,000,000.00
Other non-current financial assets N/A 31,018,515.95 31,018,515.95
Investment property 22,880,242.95 22,880,242.95
Fixed assets 5,748,562,385.35 5,748,562,385.35
Construction in progress 337,230,646.42 337,230,646.42
Intangible assets 478,689,064.45 478,689,064.45
Goodwill 20,613,803.29 20,613,803.29
Long-term prepaid expense 119,126,407.71 119,126,407.71
Deferred income tax assets 88,636,929.06 88,636,929.06
Other non-current assets 43,100,215.87 43,100,215.87
Total non-current assets 7,050,664,003.50 7,008,106,865.70 -42,557,137.80
Total assets 10,537,759,811.84 10,555,814,674.04 18,054,862.20
Lu Thai Textile Co., Ltd. First Quarter Report 2019
Current liabilities:
Short-term borrowings 1,325,273,780.05 1,325,273,780.05
Financial liabilities at fair value through
4,877,600.00 N/A -4,877,600.00
profit or loss
Derivative financial liabilities 4,877,600.00 4,877,600.00
Notes and accounts payable 353,688,510.95 353,688,510.95
Advances from customers 105,562,378.66 105,562,378.66
Payroll payable 325,998,210.17 325,998,210.17
Taxes payable 43,556,823.75 43,556,823.75
Other payables 215,946,987.68 215,946,987.68
Including: Interest payable 3,068,841.54 3,068,841.54
Dividends payable 441,113.64 441,113.64
Total current liabilities 2,374,904,291.26 2,374,904,291.26
Non-current liabilities:
Long-term borrowings 170,019,083.89 170,019,083.89
Long-term payroll payable 96,958,178.53 96,958,178.53
Deferred income 140,183,446.39 140,183,446.39
Deferred income tax liabilities 28,030,096.38 27,938,296.38 -91,800.00
Other non-current liabilities 1,840,000.00 1,840,000.00
Total non-current liabilities 437,030,805.19 436,939,005.19 -91,800.00
Total liabilities 2,811,935,096.45 2,811,843,296.45 -91,800.00
Owners’ equity:
Share capital 922,602,311.00 922,602,311.00
Capital reserves 699,493,647.48 699,493,647.48
Less: Treasury stock 486,922,944.94 486,922,944.94
Other comprehensive income 61,157,013.37 78,691,675.57 17,534,662.20
Surplus reserves 1,022,717,451.40 1,022,717,451.40
Retained earnings 4,927,500,989.55 4,928,112,989.55 612,000.00
Total equity attributable to owners of the
7,146,548,467.86 7,164,695,130.06 18,146,662.20
Company as the parent
Non-controlling interests 579,276,247.53 579,276,247.53
Total owners’ equity 7,725,824,715.39 7,743,971,377.59 18,146,662.20
Total liabilities and owners’ equity 10,537,759,811.84 10,555,814,674.04 18,054,862.20
Note for adjustment:
In 2017, Ministry of Finance respectively revised and issued the Accounting Standards for Business Enterprises No. 22 - Recognition
and Measurement of Financial Instruments, the Accounting Standards for Business Enterprises No. 23 – Transfer of Financial Assets,
Lu Thai Textile Co., Ltd. First Quarter Report 2019
the Accounting Standards for Business Enterprises No. 24 – Hedging Accounting, and the Accounting Standards for Business
Enterprises No. 37 – Presentation of Financial Instruments (hereinafter jointly referred to as “new standards governing financial
instruments”), which required that enterprises listed domestically shall implement it from 1 January 2019. According to the standards,
enterprises shall, on implementation date of the standards, classify and measure financial instruments according to regulations, and
adjustment is not needed if the involved previous comparative data of financial statements is different from the data under the “new
standards governing financial instruments. For the balance between the original carrying value of financial instruments and the new
carrying value on implementation date of the standards, the amount of the items on 1 January 2019 in financial statements shall be
adjusted, such as earned earnings, other comprehensive income.
The Company began to implement the new standards governing financial instruments from 1 January 2019. According to Notes of
Revising and Printing the Format of 2018 General Enterprises Financial Statement issued by the Ministry of Finance, the Company
shall reclassify the original financial assets (liabilities) into trading financial assets, investments in other equity instruments, other
non-current financial assets, and derivative financial liabilities. For details about the influenced items and amounts, see the above
adjusted financial statements.
Balance Sheet of the Company as the Parent
Unit: RMB
Item 31 December 2018 1 January 2019 Adjusted
Current assets:
Monetary capital 191,305,104.80 191,305,104.80
Trading financial assets N/A 60,612,000.00 60,612,000.00
Notes and accounts receivable 407,781,221.62 407,781,221.62
Including: Notes receivable 91,555,248.34 91,555,248.34
Accounts receivable 316,225,973.28 316,225,973.28
Prepayments 115,020,260.51 115,020,260.51
Other receivables 395,847,213.77 395,847,213.77
Inventories 1,040,433,078.53 1,040,433,078.53
Other current assets 12,671,631.64 12,671,631.64
Total current assets 2,163,058,510.87 2,223,670,510.87 60,612,000.00
Non-current assets:
Available-for-sale financial assets 73,112,000.00 N/A -73,112,000.00
Investments in other debt obligations N/A
Long-term equity investments 2,165,711,579.69 2,165,247,925.94 -463,653.75
Other non-current financial assets N/A 31,018,515.95 31,018,515.95
Investment property 14,804,592.72 14,804,592.72
Fixed assets 2,731,726,695.28 2,731,726,695.28
Construction in progress 61,182,771.86 61,182,771.86
Intangible assets 242,204,032.54 242,204,032.54
Lu Thai Textile Co., Ltd. First Quarter Report 2019
Deferred income tax assets 52,758,961.05 52,758,961.05
Other non-current assets 6,047,443.10 6,047,443.10
Total non-current assets 5,347,548,076.24 5,304,990,938.44 -42,557,137.80
Total assets 7,510,606,587.11 7,528,661,449.31 18,054,862.20
Current liabilities:
Short-term borrowings 622,604,447.52 622,604,447.52
Financial liabilities at fair value through profit
4,877,600.00 N/A -4,877,600.00
or loss
Derivative financial liabilities 4,877,600.00 4,877,600.00
Notes and accounts payable 120,141,727.66 120,141,727.66
Advances from customers 49,798,551.14 49,798,551.14
Payroll payable 240,090,943.88 240,090,943.88
Taxes payable 30,914,089.32 30,914,089.32
Other payables 303,672,590.72 303,672,590.72
Including: Interest payable 2,475,549.88 2,475,549.88
Dividends payable 441,113.64 441,113.64
Total current liabilities 1,372,099,950.24 1,372,099,950.24
Non-current liabilities:
Long-term payroll payable 96,958,178.53 96,958,178.53
Deferred income 94,390,844.09 94,390,844.09
Deferred income tax liabilities 16,699,530.43 16,607,730.43 -91,800.00
Total non-current liabilities 208,048,553.05 207,956,753.05 -91,800.00
Total liabilities 1,580,148,503.29 1,580,056,703.29 -91,800.00
Owners’ equity:
Share capital 922,602,311.00 922,602,311.00
Capital reserves 759,836,756.57 759,836,756.57
Less: Treasury stock 486,922,944.94 486,922,944.94
Other comprehensive income 520,200.00 18,054,862.20 17,534,662.20
Surplus reserves 1,019,608,711.76 1,019,608,711.76
Retained earnings 3,714,813,049.43 3,715,425,049.43 612,000.00
Total owners’ equity 5,930,458,083.82 5,948,604,746.02 18,146,662.20
Total liabilities and owners’ equity 7,510,606,587.11 7,528,661,449.31 18,054,862.20
Note for adjustment:
In 2017, Ministry of Finance respectively revised and issued the Accounting Standards for Business Enterprises No. 22 - Recognition
and Measurement of Financial Instruments, the Accounting Standards for Business Enterprises No. 23 – Transfer of Financial Assets,
Lu Thai Textile Co., Ltd. First Quarter Report 2019
the Accounting Standards for Business Enterprises No. 24 – Hedging Accounting, and the Accounting Standards for Business
Enterprises No. 37 – Presentation of Financial Instruments (hereinafter jointly referred to as “new standards governing financial
instruments”), which required that enterprises listed domestically shall implement it from 1 January 2019. According to the standards,
enterprises shall, on implementation date of the standards, classify and measure financial instruments according to regulations, and
adjustment is not needed if the involved previous comparative data of financial statements is different from the data under the “new
standards governing financial instruments. For the balance between the original carrying value of financial instruments and the new
carrying value on implementation date of the standards, the amount of the items on 1 January 2019 in financial statements shall be
adjusted, such as earned earnings, other comprehensive income.
The Company began to implement the new standards governing financial instruments from 1 January 2019. According to Notes of
Revising and Printing the Format of 2018 General Enterprises Financial Statement issued by the Ministry of Finance, the Company
shall reclassify the original financial assets (liabilities) into trading financial assets, other non-current financial assets, and derivative
financial liabilities. For details about the influenced items and amounts, see the above adjusted financial statements.
III Independent Auditor’s Report
Indicate by tick mark whether the financial statements above have been audited by an independent auditor.
□Yes √ No
These financial statements have not been audited by such an auditor.
Signature of the Chairman of the Board: Liu Zibin
Lu Thai Textile Co., Ltd.
30 April 2019