2018 Semi-annual Report Abstract of Yantai Changyu Pioneer Wine Co., Ltd.
Shares Code: 000869， 200869 Shares Abbreviation: Changyu A， Changyu B Notice No.: 2018-Final03
Yantai Changyu Pioneer Wine Co., Ltd. 2018 Semi-annual Report Abstract
1. Important Warning
This Semi-annual Report abstract comes from the whole contents of semi-annual report. If investors
desire to comprehend the Company’s operating results, financial situation and future development
plan, please read the Semi-annual Report on the media specified by the China Securities Regulatory
Commission.
Objections statement of directors, supervisors & senior managers
Directors, Supervisors, Senior Management Staffs of the Company have no objection with 2018
semi-annual report.
Statement
Except the following directors, all other directors have personally attended the meeting for
deliberating the semi-annual report.
Director name with Director post with Reason for non-present Name of mandatory
non-present in person non-present in person in person
Sun Liqiang Director Business trip Zhou Hongjiang
Augusto Reina Director Business trip Aldino Marzorati
Non-standard audit opinion notice
□Available Not available
The preliminary scheme of the report period’s common stock profit distribution or increasing equity
with reserve deliberated by the board of the directors
□Available Not available
The Company has no plan to distribute cash dividends and bonus shares; capital reserve will not be
transferred to equity.
The preliminary scheme of this report period’s preferred share profit distribution deliberated and
passed by the board
□Available Not available
2. Brief Introduction of the Company
1) Company introduction
Changyu A, 000869,
Abbreviation of the Shares: Code number of the Shares
Changyu B 200869
Place of listing of the Shares Shenzhen Stock Exchange
Secretary to the Board of Authorized Representative of the
Contact person and information
Directors Securities Affairs
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2018 Semi-annual Report Abstract of Yantai Changyu Pioneer Wine Co., Ltd.
Name Mr. Qu Weimin Mr. Li Tingguo
56 Dama Road, Yantai, 56 Dama Road, Yantai,
Address
Shandong, China Shandong, China
Tel 0086-535-6633656 0086-535-6633656
E-mail quwm@changyu.com.cn stock@changyu.com.cn
2) Key accounting data and financial indicators
Whether the Company makes retroactive adjustments or restates the accounting data of previous
fiscal years.
□Yes No
In the same period of More or less than last
In the report period
last year year (%)
Business revenue (CNY) 2,828,230,064 2,767,098,197 2.21%
Net profit attributed to the
shareholders of the listed 635,837,405 670,069,054 -5.11%
company (CNY)
Net profit attributed to the
shareholders of the listed
company after deducting 606,678,719 652,906,375 -7.08%
the irregular profit and loss
(CNY)
Net cash flows from the
552,753,472 420,360,319 31.50%
operating activities (CNY)
Basic earnings per share
0.93 0.98 -5.10%
(CNY/share)
Diluted earnings per share
0.93 0.98 -5.10%
(CNY/share)
Weighted average for
6.89% 7.84% -0.95%
earning rate of the net assets
The end of the report More or less than last
The end of last year
period year (%)
Total assets (CNY) 13,038,507,425 12,536,755,208 4%
Net Assets attributed to the
shareholders of the listed 9,532,948,884 8,906,342,299 7.04%
company (CNY)
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2018 Semi-annual Report Abstract of Yantai Changyu Pioneer Wine Co., Ltd.
3) Number of shareholder and shareholding situation
Unit: share
Total number of
Total common 40,428 (21,831 of Stock preferred
shareholders at the end A and 18,597 of Stock shareholder recovering 0
of report period B) voting power at the end
of report period
Shareholders holding more than 5% or the top 10 shareholders holding situation
Pledged or
Percent Number of
Name of Character of age frozen
shareholders Number of Shares held restricted
Shareholders (%) Share Amo
shares
status unt
YANTAI 50.40% 345,473,856 0 0
Domestic
CHANGYU
non-state-owned
GROUP CO.
legal person
LTD.
GAOLING Foreign legal 3.08% 21,090,219 0 0
person
FUND,L.P.
CHINA State-owned legal 2.27% 15,531,455 0 0
person
SECURITIES
FINANCE
CORP
BBH BOS S/A 2.22% 15,241,826 0 0
FIDELITY FD Foreign legal
- CHINA person
FOCUS FD
SHENWAN 1.19% 8,144,869 0 0
HONGYUAN
SECURITIES( Foreign legal
HONG person
KONG)
LIMITED
GUOTAI 0.95% 6,535,089 0 0
JUNAN
Foreign legal
SECURITIES(
person
HONGKONG)
LIMITED
FIDELITY 0.89% 6,100,762 0 0
PURITAN
Foreign legal
TRUST:
person
FIDELITY
SERIES
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2018 Semi-annual Report Abstract of Yantai Changyu Pioneer Wine Co., Ltd.
INTRINSIC
OPPORTUNI
TIES FUND
CENTRAL 0.69% 4,761,200 0 0
HUIJIN
State-owned legal
ASSET
person
MANAGEME
NT LTD.
VANGUARD 0.55% 3,788,487 0 0
EMERGING
Foreign legal
MARKETS
person
STOCK
INDEX FUND
FIDELITY 0.55% 3,779,202 0 0
CHINA
Foreign legal
SPECIAL
person
SITUATIONS
PLC
Among the top 10 shareholders, Yantai
The explanation for the associated relationship and
Changyu Group Company Limited has no
accordant action of the top 10 shareholders with
associated relationship or accordant action
unrestricted shares, the the associated relationship and
relationship with the other 9 listed
accordant action between the top 10 shareholders with
shareholders, and the relationship among the
unrestricted shares and the top 10 shareholders
other shareholders is unknown.
Explanation for the top 10 shareholders who involved in
The top 10 shareholders do not involve in
financing activities and stock trading business (if
financing activities and stock trade business.
have)(see note 4)
4) Changes of controlling shareholders or the actual controllers situation
Changes of the controlling shareholders during the report period
□Available Not available
There is no any change of the controlling shareholders during the report period.
Changes of the actual controllers during the report period
□Available Not available
There is no any change of the actual controllers during the report period
5) Number of preferred shareholder and situation of preferred shares held by top ten
preferred shareholders
□Available Not available
There are no shares held by preferred shareholders during the report period.
6) Company Bonds
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2018 Semi-annual Report Abstract of Yantai Changyu Pioneer Wine Co., Ltd.
Whether the Company exists public offering and lists on the Stock Exchange, and the Company is
unable to fully pay company bonds in the approved announcement date of this Semi-annual report
before maturity or in the maturity date.
No.
3. Management Discussion and Analysis
1) Brief introduction of operation situation during the report period
Whether the Company need to follow the disclosure requirement of special business?
No.
(1) Summarization
During the report period, influenced by the slowdown of domestic economic growth, the overall
domestic wine industry is relatively stable. Influenced by the further decrease in product price
resulting from the overwhelming flow of foreign wine into Chinese market, the competition in
domestic wine market, especially for middle-and-low-level wines, is very fierce, plus the great
impact brought by E-commerce and other new channels to traditional sales channels in the meantime
this company’s E-commerce business is still in the beginning stage, resulting in bigger challenges for
the Company to achieve sustained and steady growth. Facing quite a lot of external disadvantages,
the Company insists to focus on the market, timely adjust the development strategy and marketing
tactics, optimize the market layout and product structure, perfect the marketing channels and
assessment system, strive to promote product sales, achieving good results and realizing business
income of CNY2828.23 million, an increase of 2.21% compared with last year; but due to the impact
of increase in operating cost, taxes and additional, sales expense and administrative expense, the
Company realized net profit of CNY635.84 million belonging to the parent company’s shareholders,
an decrease of 5.11% compared with last year.
During the report period, the Company mainly did following works:
Firstly, the Company adjusted and fortified its management team, increasing the management level
and capacity of management team.
Secondly, the Company proposed the strategy of “Focus on big product, focus on high quality, focus
on middle-to-high end” (in other words “Three Focus” strategy), further clarifying its development
direction.
Thirdly, the Company basically completed the reform and reorganization work in sales systems,
improving the mode of market investment and enhancing marketing ability. The Company further
implemented the measure of “personnel reduction while salary increase” in sales system, reduced
redundant personnel, completed the personnel setting, position setting and personnel allocation work
in business management department in sales system, perfected performance assessment method for
marketing personnel and conducted authorized operation to partial business unit and provincial
branches, improving the sales team’s working enthusiasm, initiative and fighting capacity.
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2018 Semi-annual Report Abstract of Yantai Changyu Pioneer Wine Co., Ltd.
Fourthly, the Company fully implemented “Three Focus” strategy, accelerated the product carding as
well as the backbone distributor system construction and increased the market investment, improving
products’ market competitiveness. For high-end products, the Company focused on “MOSER”,
“AFIP”, “CASTEL”, “Golden Icewine Valley”, “Baron Balboa”, “Rena”, “Tinlot” wine and “Koya”
brandy and strived to build “MOSER” to a globally well-known high-end brand, to build “AFIP”,
“CASTEL”, “Golden Icewine Valley” and “Koya” to nationally well-known high-end brands and to
build “Baron Balboa”, “Rena”, “Tinlot” to regionally well-known high-end brands. For middle-end
products, the Company focused on “Noble Dragon” and reserva five-star brandy, reinforced the
market development in the ninth-edition Noble Dragon and reserva five-star brandy, continued
consolidating and enlarging the position of “Noble Dragon” as domestic biggest single product in
wine market and continually increased the market share of middle-end brandy. For low-to-mid-end
products, the Company focused on “Zuishixian” and mini-brandy to digging consumption potential
and to guide and cultivate new consumer group. For imported liquor, the Company mainly paid
attention to acquired brands, such as Atrio, Mirefleurs, Indomita, Kilikanoon and Roullet Fransac in
order to occupy important position in Chinese imported wine market. The Company also conducted
comprehensive carding and reorganization to products and distributor team, reduced product items,
eliminated and replaced unqualified distributors, implemented strict access system to distributors
selling the ninth-edition Noble Dragon and new-edition “Zuishixian”, changed the market investment
mode, intensified the fighting degree to fleeing goods, further standardized market order, better
protected distributors’ interest and improved distributors’ enthusiasm.
Fifthly, the Company strengthened quality management and quickened the pace in product update
and upgrade in order to better adapt to market change. During the report period, the Company
revised internal quality management system, took unannounced inspection to eleven wineries and
conducted update and upgrade work to products including partial chateau wine, Noble Dragon,
reserva five-star brandy, five-star brandy and Zuishixian etc, effectively improving product quality
and better satisfying the market need.
Sixthly, the Company reinforced financial management and audit work in order to strive to
accomplish energy-saving and cost-reducing and to further reduce operating cost. During the report
period, the Company further strengthened internal fund allocation and control, reasonably arranged
loan structure, strived to reduce fund cost; intensified the cost management, such as advertisement
and major raw material purchase and so on, and strongly reduced freight and storage expense;
enhanced the financial management in overseas acquired enterprise and reinforced audit degree to
investment project in order to prevent operating risk and improve investment benefits; made great
efforts to increase the ratio of order-driven products, to shorten delivery time, to reduce inventory
and capital occupying and to improve enterprise profitability.
Seventhly, the Company continued implementing internationalization strategy and orderly promoted
overseas acquisition work. During the report period, the Company acquired 80% equity of
Kilikanoon Estate Pty Ltd in Australia, optimizing the Company’s capacity layout and product
structure and further improving the market competition of imported products. Through M&A and
strategic cooperation, the Company’s production had extended to Asia, Europe, America and
Oceania and the Company had completed the capacity layout in major global wine-producing
countries and famous wine-producing region, such as France, Spain, Australia and Chile and so on.
The Company also had deep brand cooperation with major wine enterprises in Italy, New Zealand,
Argentina and other countries. Now the Company owned five overseas chateaux, eight domestic
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2018 Semi-annual Report Abstract of Yantai Changyu Pioneer Wine Co., Ltd.
chateaux and more than twenty foreign and domestic major brands and sold its products to more than
seventy countries and regions in the world.
Eighthly, the Company strengthened the management in investment project and basically completed
the installation and commissioning work of major production lines in Changyu industrial park, laying
the foundation of putting into operation as soon as possible and further improving production
efficiency.
In order to achieve the operation target set by the Company at the beginning of this year, the
Company would do following work in the second half of 2018:
Firstly, the Company will intensify the brand construction and carding work and enlarge the
cooperation breadth and depth with domestic E-commerce magnate and new media in order to
improve brand awareness and reputation. The Company will intensify brand aggregation, continue
teasing and reducing product quantity and optimize product line; for choice of media, bind up with
high-flow platform, enhance resource exchange and share and take deep cooperation with precision
media with high category permeability to form high-flow and strong-viscosity communication
strategy; for publicity form, focus on output content, aim at different media attribute and make brand
image output at different platforms including MicroBlog, WeChat official account, Zhihu account
and TouTiao etc by adopting micro film, short video, multimedia, long image-text, live broadcast
and other forms.
Secondly, the Company will continue paying attention to the construction of key distributor team and
professional sales personnel team, conduct the tasting and promotion work of mid-to-high-end
products, such as chateau wine, Noble Dragon, “Three Star” and above level brandy and Zuishixian
and so on, and strive to promote the sales of mid-to-high-end products; do the preparation work for
the opening of Koya chateau and the launch of new products, such as Koya brandy; continue
promoting the sales work of acquired brands in domestic and foreign markets, such as Atrio,
Mirefleurs, Donelli, Indomita and Kilikanoon and so on, further establish and perfect the domestic
and foreign sales system, take full advantage of foreign sales network to enlarge the export scale of
domestic wines; centralize marketing resources and focus on key markets to continually enlarge the
quantity and coverage of dominated market.
Thirdly, the Company will start the order-driven business mode for Noble Dragon distributors, make
great efforts to shorten delivery time and reduce inventory level and fund occupation.
Fourthly, the Company will further enlarge and implement authorized operation to improve the
positivity, initiative and flexibility of front-line production and management personnel and to
accelerate market reaction speed; improve the Company’s assessment and incentive measures to
production and management department, enhance staff training and reorganization, strictly carry out
assessment, reward, promotion and elimination system, and motivate all staff’s vitality and fighting
capacity.
Fifthly, the Company will orderly proceed the construction of investment projects and focus on the
connection between production and sales. The Company will pay special attention to the ending
work of main body’s civil work in Yantai Changyu International Wine City (in other words Yantai
Changyu Industry Park), accelerate the construction of intelligentization and informatization
management system as well as the maintenance and transformation in Cognac Roullet Fransac
chateau and the fire engineering in the research institute; conduct the coordination work between
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2018 Semi-annual Report Abstract of Yantai Changyu Pioneer Wine Co., Ltd.
project construction and production and reasonably arrange construction and production progress to
timely satisfy the market need.
Sixthly, the Company will strengthen the management in supply chain and fully accomplish the
purchase in grape material. The Company will enhance the construction and management in the
supply chain of overseas and domestic grape material and other packing materials, strive to realize
diversification of material supply and make sure that, for all raw materials, the important segment
could be monitored and the whole course could be traced; based on the material requirement in
future years, scientifically make raw material purchase plan, further perfect raw material pricing
mechanism, reasonably determine raw material purchase price, comprehensively complete raw
material purchase work, preferably control raw material cost and improve raw material quality.
(2) Analysis of main business
See “1. Summarization” in “Management Discussion and Analysis”.
Period comparison of main financial data
Unit: CNY
In the same
In the report More or
period of last Reason for changes
period less (%)
year
Mainly attributed to the Company’s
Operating consolidation of companies in Chile
2,828,230,064 2,767,098,197 2.21% and Australia that are included in the
revenue scope of consolidation making an
increase in operating revenue
Mainly attributed to the increase in
prices of raw materials and
Operating cost 974,557,292 925,754,133 5.27%
packaging materials on year-on-year
basis
Mainly attributed to the increase in
advertising promotion fees and
Sales expense 710,659,033 668,735,726 6.27%
marketing staff compensation on
year-on-year basis
Mainly attributed to the increase of
Management employee’s compensation and
160,091,888 130,542,386 22.64%
expense depreciation expense on year-on-year
basis
Mainly attributed to the increase in
Financial expense 13,085,942 11,147,949 17.38% interest expenses and handling fees
on year-on-year basis
Mainly attributed to the decrease in
Income tax
211,979,735 228,752,790 -7.33% total profit (profit before tax) on
expense
year-on-year basis which results in a
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2018 Semi-annual Report Abstract of Yantai Changyu Pioneer Wine Co., Ltd.
decrease in current income tax
expenses on year-on-year basis
Net amount of
cash flow Mainly attributed to the increase of
cash received from goods selling and
generated in 552,753,472 420,360,319 31.50%
labor service providing on
operating year-on-year basis
activities
Net amount of Mainly attributed to the recovery of
fixed term deposits making the cash
cash flow
injection in investment activities
generated in -291,217,548 -797,540,941 63.49% increased on year-on-year basis and
the cash outflow from investment
investment
activities decreased on year-on-year
activities basis
Net amount of
cash flow Mainly attributed to the year-on-year
decrease in cash received from loans
generated in -6,350,537 353,878,706 -101.79%
and the year-on-year increase in cash
financing paid for debt repayment
activities
Net increased Mainly attributed to the increase in
amount of cash net cash flow from operating
247,781,188 -27,454,401 1,002.52% activities and net cash flow from
and cash investing activities on year-on-year
equivalents basis
Whether there is any great change for the Company’s profit structure or profit source during the
report period
□Available Not available
There is no great change for the Company’s profit structure or profit source during the report period.
Structure of main businesses
Unit: CNY
Operating Operating Gross Increase or Increase or Increase or
Item
revenue cost profit decrease of decrease of decrease of gross
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2018 Semi-annual Report Abstract of Yantai Changyu Pioneer Wine Co., Ltd.
(%) operating operating cost profit over the
revenue over the over the same same period of
same period of period of last year last year
last year (%) (%)
Sector
Wine and
alcoholic 2,828,230,064 974,557,292 65.54% 2.21% 5.27% -1%
beverages
Product
Wine 2,235,369,550 759,887,101 66.01% 3.92% 7.94% -1.26%
Brandy 552,121,883 194,450,633 64.78% -4.03% -2.86% -0.43%
Other 40,738,631 20,219,557 50.37% 0.22% -6.23% 3.42%
(3) Analysis to non-main business
□Available Not available
(4) Assets and liabilities situation
①Major changes of assets
Unit: CNY
The end of the report The end of the same
Proportion
period period of last year
increase or Explanation on
Proportion Proportion
decrease significant changes
Amount in the total Amount in the total
(%)
assets (%) assets (%)
Monetary No significant
1,683,038,453 12.91% 1,550,067,781 12.63% 0.28%
funds changes
No significant
Receivables 243,413,092 1.87% 167,152,509 1.36% 0.51%
changes
Mainly attributed to
the increase in raw
Inventory 2,338,925,432 17.94% 2,024,302,929 16.49% 1.45% materials reserved
at the end of the
report period
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2018 Semi-annual Report Abstract of Yantai Changyu Pioneer Wine Co., Ltd.
Investment No significant
17,877,379 0.14% 0% 0.14%
real estate changes
Long-term
No significant
equity 0% 0%
changes
investments
Mainly attributed to
the transfer of
Fixed assets 5,457,575,677 41.86% 4,591,037,486 37.40% 4.46% constructions in
progress during the
report period
Mainly attributed to
the transfer of
Construction constructions in
1,015,914,753 7.79% 1,697,297,440 13.83% -6.04%
in progress progress into fixed
assets during the
report period
Mainly attributed to
Short-term
750,454,676 5.76% 846,881,075 6.90% -1.14% the return of short
borrowings
term bank loans
Long-term No significant
153,965,191 1.18% 175,270,580 1.43% -0.25%
borrowings changes
②Measuring assets and liabilities at fair value
□Available Not available
③Assets rights restricted situation up to the end of report period
Assets rights restricted situation of the Company up to the end of report period, please refer to
Announcement on External Guarantee (announcement number: 2016-Temporary 021) and
Announcement on External Guarantee (announcement number: 2017-Temporary 015) disclosed on
China Securities Journal, Securities and the website (www.cninfo.com.cn) respectively on
December 22nd, 2016 and December 12th, 2017.
2) Related items involving financial report
(1) Explanation for the changes of the accounting policy, accounting estimation and accounting
method
□Available Not available
There are no changes to the accounting policy, accounting estimation and accounting method during
the report period.
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2018 Semi-annual Report Abstract of Yantai Changyu Pioneer Wine Co., Ltd.
(2) During the report period, the situation explanation for the correction of major accounting
errors which need to be retrospect and restated
□Available Not available
There is no situation for the correction of major accounting errors which need to be retrospect and
restated.
(3) Compared with the previous year’s financial report, explanation for the changes of the
consolidated statements scope.
Available □Not available
Owing that Indomita Wine Company Chile, SpA, established by the Company, completed the equity
acquisition of Via Indómita, S.A., Via Dos Andes, S.A. and Bodegas Santa Alicia SpA in July
2017 and the Company completed the acquisition of 80% equity of Kilikanoon Estate Pty Ltd during
the report period, above relevant enterprises have already been included in the consolidated
statements scope during this report period. Besides this, compared with the previous year’s financial
report, there is no other change in the consolidated statements scope.
Yantai Changyu Pioneer Wine Co. Ltd.
Board of Directors
August 30th, 2018
12
