Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Financial Report
1. Audit report
Whether the semiannual report has been audited
□ Yes √ No
2. Financial statement
The unit in the statements of the financial annotations is RMB Yuan.
2.1 Consolidated balance sheet
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd. June 30, 2019 Unit: Yuan
December 31,
Item Note June 30, 2019
2018
Current assets:
M onetary fund 7.1 1,848,632,953 1,475,700,477
Settlement reserves
Lending funds
Tradable financial assets
Financial assets measured at the fair value and the variation of which is
recorded into the current profits and losses
Derivative financial assets
Bills receivable 7.2 288,667,988
Accounts receivable 7.3 186,131,192 242,153,083
Receivables financing 7.4 372,281,872
Advance payment 7.5 3,490,928 4,219,949
Premium receivable
Reinsurance accounts receivable
Receivable reserves for reinsurance contract
Other receivables 7.6 28,618,983 22,636,086
Including: Interest receivable 2,099,109 1,332,681
Dividends receivable
Redemptory monetary capital for sale
Inventories 7.7 2,606,781,436 2,724,591,457
Contract assets
Assets held for sale
Non-current assets due within one year
Other current assets 7.8 300,418,901 258,676,396
Total current assets 5,346,356,265 5,016,645,436
Non-current assets:
Offering loans and imprest
Debt investments
Available-for-sale financial assets 467,251
Other debt investments
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Item Note June 30, 2019 December 31,
2018
Held-to-maturity investments
Long-term receivables
Long-term equity investments
Other investments in equity instruments
Other non-current financial assets 7.9 515,922
Investment real estate 7. 10 30,560,470 31,572,489
Fixed assets 7.11 5,684,612,653 5,749,731,667
Construction in progress 7.12 789,872,373 759,296,591
Productive biological assets 7.13 207,613,439 209,266,373
Oil-and-gas assets
Right-of-use assets
Intangible assets 7.14 647,158,886 655,473,459
Development expenditure
Goodwill 7.15 165,199,111 165,199,111
Long-term prepaid expenses 7.16 276,557,711 244,640,416
Deferred income tax assets 7.17 234,646,603 285,436,259
Other non-current assets
Total non-current assets 8,036,737,168 8,101,083,616
Total assets 13,383,093,433 13,117,729,052
Current liabilities:
Short-term loans 7.18 678,170,667 688,002,410
Borrowings from the Central Bank
Loans from other banks and other financial institutions
Tradable financial liabilities
Financial liabilities measured at the fair value and the variation of which
is recorded into the current profits and losses
Derivative financial liabilities
Bills payable
Accounts payable 7.19 539,459,878 713,572,881
Advances from customers 7.20 177,549,080 226,075,244
Financial assets sold for repurchase
Deposits from customers and interbank
Receivings from vicariously traded securities
Receivings from vicariously sold securities
Employee remunerations payable 7.21 177,466,368 212,304,217
Taxes and dues payable 7.22 109,000,802 128,912,790
Other payables 7.23 977,667,007 608,479,890
Including: Interest payable 2,669,667 712,826
Dividends payable 412,646,375
Handling charges and commissions payable
Dividend payable for reinsurance
Contract liabilities
Liabilities held for sale
Non-current liabilities due within one year 7.24 180,362,314 152,940,788
Other current liabilities 7.25 14,545,254 15,860,254
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Item Note June 30, 2019 December 31,
2018
Total current liabilities 2,854,221,370 2,746,148,474
Non-current liabilities:
Reserves for insurance contracts
Long-term borrowings 7.26 165,949,250 156,480,662
Bonds payable
Including: Preferred stock
Perpetual bonds
Lease liabilities
Long-term accounts payable 7.27 201,000,000 225,000,000
Long-term employee remunerations payable
Estimated liabilities
Deferred income 7.28 64,050,895 70,367,039
Deferred income tax liabilities 7.17 18,629,612 22,010,647
Other non-current liabilities 7.29 7,159,222 7,234,853
Total non-current liabilities 456,788,979 481,093,201
Total liabilities 3,311,010,349 3,227,241,675
Owner’s equity:
Capital stock 7.30 685,464,000 685,464,000
Other equity instruments
Including: Preferred stock
Perpetual bonds
Capital surplus 7.31 565,955,441 565,955,441
M inus: Treasury stock
Other comprehensive income 7.32 -95,344 2,965,377
Special reserves
Surplus reserves 7.33 342,732,000 342,732,000
General risk preparation
Undistributed profit 7.34 8,197,828,994 8,008,982,547
Total owner’s equities attributable to the parent company 9,791,885,091 9,606,099,365
M inority equity 280,197,993 284,388,012
Total owner’s equities 10,072,083,084 9,890,487,377
Total liabilities and owner’s equities 13,383,093,433 13,117,729,052
Legal Representative: Zhou Hongjiang Accounting Supervisor: Jiang Jianxun Accounting Department M anager: Jiang
Jianxun
2.2 Balance sheet of the parent company
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd. Unit: Yuan
Item Note June 30, 2019 December 31, 2018
Current assets:
M onetary fund 1,083,333,310 624,588,809
Tradable financial assets
Financial assets measured at the fair value and the variation of which is
recorded into the current profits and losses
Derivative financial assets
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Item Note June 30, 2019 December 31, 2018
Bills receivable 39,885,254
Accounts receivable 15.1 1,447,973
Receivables financing 56,047,969
Advance payment 427,816 227
Other receivables 15.2 526,593,613 1,025,643,356
Including: Interest receivable 277,785 254,088
Dividends receivable 4,103,925 500,000,000
Inventories 505,479,473 385,154,740
Contract assets
Assets held for sale
Non-current assets due within one year
Other current assets 35,992,255 24,704,844
Total current assets 2,207,874,436 2,101,425,203
Non-current assets:
Debt investments
Available-for-sale financial assets
Other debt investments
Held-to-maturity investments
Long-term receivables
Long-term equity investments 15.3 7,420,803,069 7,420,803,069
Other investments in equity instruments
Other non-current financial assets
Investment real estate 30,560,470 31,572,489
Fixed assets 260,448,515 265,311,274
Construction in progress 7,319,082 6,311,701
Productive biological assets 121,158,460 125,002,793
Oil and gas assets
Right-of-use assets
Intangible assets 66,054,490 67,244,066
Development expenditure
Goodwill
Long-term prepaid expenses
Deferred income tax assets 20,699,273 24,194,967
Other non-current assets 985,700,000 972,700,000
Total non-current assets 8,912,743,359 8,913,140,359
Total assets 11,120,617,795 11,014,565,562
Current liabilities:
Short-term loans 150,000,000 150,000,000
Tradable financial liabilities
Financial liabilities measured at the fair value and the variation of which
is recorded into the current profits and losses
Derivative financial liabilities
Bills payable
Accounts payable 106,793,658 132,704,304
Advances from customers
Contract liabilities
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Item Note June 30, 2019 December 31, 2018
Employee remunerations 59,598,048 72,345,179
Taxes and dues payable 3,749,762 13,111,431
Other payables 913,805,782 607,974,519
Including: Interest payable 163,125 181,250
Dividends payable 411,278,400
Liabilities held for sale
Non-current liabilities due within one year
Other current liabilities 3,433,054 3,433,054
Total current liabilities 1,237,380,304 979,568,487
Non-current liabilities:
Long-term borrowings
Bonds payable
Including: Preferred stock
Perpetual bonds
Lease liabilities
Long-term accounts payable
Long-term employee remuneration payable
Estimated liabilities
Deferred income 7,459,789 8,910,918
Deferred income tax liabilities
Other non-current liabilities 2,951,042 2,710,575
Total non-current liabilities 10,410,831 11,621,493
Total liabilities 1,247,791,135 991,189,980
Owner’s equity:
Capital stock 685,464,000 685,464,000
Other equity instruments
Including: Preferred stock
Perpetual bonds
Capital surplus 557,222,454 557,222,454
M inus: Treasury stock
Other comprehensive income
Special reserves
Surplus reserves 342,732,000 342,732,000
Undistributed profit 8,287,408,206 8,437,957,128
Total owner’s equities 9,872,826,660 10,023,375,582
Total liabilities and owner’s equities 11,120,617,795 11,014,565,562
Legal Representative: Zhou Hongjiang Accounting Supervisor: Jiang Jianxun Accounting Department M anager:
Jiang Jianxun
2.3 Consolidated profit statement
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd. Unit: Yuan
Item Note Sum of current period Sum of prior period
1. Total operating income 2,558,274,785 2,828,230,064
Including: Operating income 7.35 2,558,274,785 2,828,230,064
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Interest income
Earned premium
Handling fee and commission income
2. Total operating costs 1,818,822,580 2,023,670,406
Including: Operating costs 7.35 936,252,225 974,557,292
Interest expenditure
Handling fees and commission expenditure
Premium rebate
Net amount of indemnity expenditure
Net amount of the withdrawn reserve fund for insurance
contract
Policy bonus payment
Amortized reinsurance expenditures
Taxes and surcharges 7.36 123,550,848 165,276,251
Selling expenses 7.37 591,970,801 710,659,033
Administrative expenses 7.38 155,552,312 157,964,882
Research and development expenses 7.39 2,706,811 2,127,006
Financial expenses 7.40 8,789,583 13,085,942
Including: Interest expenses 9,812,560 18,739,528
Interest income 4,606,417 7,245,870
Plus: Other profit 7.41 64,211,892 37,982,878
Investment profit (loss is listed with "-")
Including: Investment profit for joint-run business and joint
venture
Financial assets measured at amortized cost cease
to be recognized as income (loss is listed with
"-")
Exchange income (loss is listed with "-")
Net exposure hedge income (loss is listed with "-")
Income from fair value changes (loss is listed with "-")
Credit impairment loss (loss is listed with "-") 7.42 -765,935
Asset impairment loss (loss is listed with "-") 7.43 6,148,729 4,730,948
Income from asset disposal (loss is listed with "-") 7.44 1,138 93,958
3. Operating profit (loss is listed with "-") 809,048,029 847,367,442
Plus: Non-operating income 7.45 3,575,914 2,006,392
M inus: Non-operating expenses 7.46 164,050 1,392,362
4. Total profits (total loss is listed with "-") 812,459,893 847,981,472
M inus: Income tax expenses 7.47 210,281,578 211,979,735
5. Net profit (net loss is listed with "-") 602,178,315 636,001,737
5.1 Classification by operation continuity
5.1.1 Net profit from continuing operation (net loss is listed with 602,178,315 636,001,737
"-")
5.1.2 Net profit from terminating operation (net loss is listed
with "-")
5.2 Classification by ownership
5.2.1 Net profit attributable to owner of the parent company 603,403,789 635,837,405
5.2.2 M inority interest income -1,225,474 164,332
6. Net after-tax amount of other comprehensive income 7.48 -4,657,291 -11,126,413
Net after-tax amount of other comprehensive income attributable to -3,060,721 -9,230,820
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
owner of the parent company
6.1 Other comprehensive income not to be reclassified into profit and
loss later
6.1.1 Changes after remeasuring and resetting the benefit plans
6.1.2 Other comprehensive income not to be reclassified into profit
and loss under equity law
6.1.3 Changes in the fair value of other investments in equity
instruments
6.1.4 Changes in the fair value of the enterprise's own credit risk
6.1.5 Other
6.2 Other comprehensive income to be reclassified into profit and -3,060,721 -9,230,820
loss later
6.2.1 Other comprehensive income to be reclassified into profit and
loss under equity law
6.2.2 Changes in the fair value of other debt investments
6.2.3 Profit and loss from changes in the fair value of financial assets
for sale
6.2.4 Amount of financial assets reclassified into other
comprehensive income
6.2.5 Profit and loss from reclassification of held-to-maturity
investments into financial assets for sale
6.2.6 Provision for credit impairment of other credit investments
6.2.7 Provision for cash-flow hedge
6.2.8 Difference in translation of Foreign Currency Financial -3,060,721 -9,230,820
Statement
6.2.9 Other
Net after-tax amount of other comprehensive income attributable to -1,596,570 -1,895,593
minority shareholders
7. Total comprehensive income 597,521,024 624,875,324
Attributable to owner of the parent company 600,343,068 626,606,585
Attributable to minority shareholders -2,822,044 -1,731,261
8. Earnings per share:
8.1 Basic earnings per share 0.88 0.93
8.2 Diluted earnings per share 0.88 0.93
Legal Representative: Zhou Hongjiang Accounting Supervisor: Jiang Jianxun Accounting Department M anager:
Jiang Jianxun
2.4 Profit statement of the parent company
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd. Unit: Yuan
Item Note Sum of current period Sum of prior period
1. Operating income 15.4 352,351,002 408,845,211
M inus: Operating costs 15.4 309,570,580 352,646,989
Taxes and surcharges 13,140,156 24,463,375
Selling expenses
Administrative expenses 39,434,246 39,827,281
Research and development expenses 405,061 360,466
Financial expenses -3,657,370 -15,151,608
Including: Interest expenses -2,705,073 11,357,611
Interest income 1,470,667 29,630,717
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Plus: Other profit 1,716,527 1,976,527
Investment profit (loss is listed with "-") 15.5 264,221,755 312,409,576
Including: Investment profit for joint-run business and joint
venture
Financial assets measured at amortized cost cease
to be recognized as income (loss is listed with
"-")
Net exposure hedge income (loss is listed with "-")
Income from fair value changes (loss is listed with "-")
Credit impairment loss (loss is listed with "-")
Asset impairment loss (loss is listed with "-")
Income from asset disposal (loss is listed with "-") 75,000
2. Operating profit (loss is listed with "-") 259,396,611 321,159,811
Plus: Non-operating income 703,559 56,479
M inus: Non-operating expenses 97,638 528
3. Total profits (total loss is listed with "-") 260,002,532 321,215,762
M inus: Income tax expenses -726,946 2,450,592
4. Net profit (net loss is listed with "-") 260,729,478 318,765,170
4.1Net profit from continuing operation (net loss is listed with 260,729,478 318,765,170
"-")
4.2 Net profit from terminating operation (net loss is listed with
"-")
5. Net after-tax amount of other comprehensive income
5.1 Other comprehensive income not to be reclassified into profit and
loss later
5.1.1 Changes after remeasuring and resetting the benefit plans
5.1.2 Other comprehensive income not to be reclassified into profit
and loss under equity law
5.1.3 Changes in the fair value of other investments in equity
instruments
5.1.4 Changes in the fair value of the enterprise's own credit risk
5.1.5 Other
5.2 Other comprehensive income to be reclassified into profit and
loss later
5.2.1 Other comprehensive income to be reclassified into profit and
loss under equity law
5.2.2 Changes in the fair value of other debt investments
5.2.3 Profit and loss from changes in the fair value of financial assets
for sale
5.2.4 Amount of financial assets reclassified into other
comprehensive income
5.2.5 Profit and loss from reclassification of held-to-maturity
investments into financial assets for sale
5.2.6 Provision for credit impairment of other credit investments
5.2.7 Provision for cash-flow hedge
5.2.8 Difference in translation of Foreign Currency Financial
Statement
5.2.9 Other
6. Total comprehensive income 260,729,478 318,765,170
7. Earnings per share:
7.1 Basic earnings per share 0.38 0.47
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
7.2 Diluted earnings per share 0.38 0.47
Legal Representative: Zhou Hongjiang Accounting Supervisor: Jiang Jianxun Accounting Department M anager:
Jiang Jianxun
2.5 Consolidated cash flow state ment
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd. Unit: Yuan
Item Note Sum of current period Sum of prior period
1. Cash flows from operating activities:
Cash received from sales of goods and rending of 2,399,548,448 2,680,388,050
services
Net increase in customer and interbank deposits
Net increase in borrowings from central bank
Net increase in borrowings from other financial
institutions
Cash received from receiving insurance premium of
original insurance contract
Net cash received from reinsurance business
Net increase in policy holder deposits and investment
funds
Cash received from collecting interest, handling fees
and commissions
Net increase in borrowing funds
Net increase in repurchasement business funds
Net cash received for buying and selling securities
Tax refund received 20,038,271 26,089,608
Other cash received related to operating activities 7.49 67,785,620 42,343,021
Subtotal of cash flows of operating activities 2,487,372,339 2,748,820,679
Cash paid for goods and services 718,093,432 677,552,938
Net increase in customer loans and advances
Net increase in deposits in central bank and interbank
deposits
Cash paid to original insurance contract payments
Net increase in financial assets held for trading purposes
Net increase in lending funds
Cash paid to interest, handling fees and commissions
Cash paid to policy bonus
Cash paid to and on behalf of employees 278,638,333 278,814,385
Cash paid for taxes and expenses 598,384,101 802,722,798
Other cash paid related to operating activities 7.49 392,780,467 436,977,086
Sub-total of cash outflows of operating activities 1,987,896,333 2,196,067,207
Net cash flow from operating activities 499,476,006 552,753,472
2. Cash flow from investing activities:
Cash received from disinvestment
Cash received from withdrawal of fixed deposits 104,597,650 305,000,000
Cash received from obtaining investment income
Cash received from obtaining interest income 1,004,552 2,342,015
Cash received from disposal of fixed assets, intangible
175,837 471,130
assets and other long-term assets
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Item Note Sum of current period Sum of prior period
Net cash received from disposal of branch and other
business unit
Other cash received related to investing activities
Subtotal of cash flows of investment activities 105,778,039 307,813,145
Cash paid to acquire fixed assets, intangible assets and 135,073,897 154,464,274
other long-term assets
Cash for investment
Cash paid for purchasing fixed deposits 85,238,750 340,000,000
Net increase in hypothecated loan
Net cash paid for acquiring branch and other business 104,566,419
unit
Other cash paid related to investment activities
Subtotal of cash outflows of investment activities 220,312,647 599,030,693
Net cash flow from investing activities -114,534,608 -291,217,548
3. Cash flow from financing activities
Cash received from acquiring investment
Including: cash received from acquiring minority
shareholders investment by branch
Cash received from acquiring loans 656,495,139 669,905,706
Cash received from issuing bonds
Other cash received related to financing activities 7.49 23,521,431
Subtotal cash flows of financing activities 656,495,139 693,427,137
Cash paid for paying debts 658,033,492 658,512,141
Cash paid for distributing dividend and profit or paying 16,590,004 21,265,533
interest
Including: dividend and profit paid to minority
shareholders by branch
Other cash paid related to financing activities 7.49 20,000,000
Subtotal of cash outflows of financing activities 674,623,496 699,777,674
Net cash flow from financing activities -18,128,357 -6,350,537
4. Influences of exchange rate fluctuation on cash
53,702 -7,404,199
and cash equivalents
5. Net Increase in cash and cash equivalents 366,866,743 247,781,188
Plus: balance at the beginning of the period of cash and 1,206,860,334 1,180,889,274
cash equivalents
6. Balance at the end of the period of cash and cash 1,573,727,077 1,428,670,462
equivalents
Legal Representative: Zhou Hongjiang Accounting Supervisor: Jiang Jianxun Accounting Department M anager:
Jiang Jianxun
2.6 Cash flow statement of the parent company
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd. Unit: Yuan
Item Sum of current period Sum of prior period
1. Cash flows from operating activities:
Cash received from sales of goods and rending of services 219,405,421 275,862,358
Tax refund received
Other cash received related to operating activities 57,674,830 100,163,394
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Item Sum of current period Sum of prior period
Subtotal of cash flows of operating activities 277,080,251 376,025,752
Cash paid for goods and services 163,184,301 200,935,534
Cash paid to and on behalf of employees 45,116,586 43,647,320
Cash paid for taxes and expenses 22,530,113 43,132,327
Other cash paid related to operating activities 321,847,893 19,942,485
Sub-total of cash outflows of operating activities 552,678,893 307,657,666
Net cash flow from operating activities -275,598,642 68,368,086
2. Cash flow from investing activities:
Cash received from disinvestment
Cash received from withdrawal of fixed deposits 40,000,000 305,000,000
Cash received from obtaining investment income 760,152,668 717,667,435
Cash received from obtaining interest income 484,857 2,342,015
Net cash received from disposal of fixed assets, intangible assets and 7,519 538,055
other long-term assets
Net cash received from disposal of branch and other business unit
Other cash received related to investing activities
Subtotal of cash flows of investment activities 800,645,044 1,025,547,505
Cash paid to acquiring fixed assets, intangible assets and other 10,164,233 11,968,401
long-term assets
Cash for investment 13,000,000 105,926,184
Cash paid for purchasing fixed deposits 85,238,750 340,000,000
Net cash paid for acquiring branch and other business unit
Other cash paid related to investment activities
Subtotal of cash outflows of investment activities 108,402,983 457,894,585
Net cash flow from investing activities 692,242,061 567,652,920
3. Cash flow from financing activities
Cash received from acquiring investment
Cash received from acquiring loans 200,000,000
Cash received from issuing bonds
Other cash received related to financing activities
Subtotal cash flows of financing activities 200,000,000
Cash paid for debts 600,000,000
Cash paid to distribute dividend, profit or pay interest 3,248,000 11,660,417
Other cash paid related to financing activities
Subtotal of cash outflows of financing activities 3,248,000 611,660,417
Net cash flow from financing activities -3,248,000 -411,660,417
4. Influences of exchange rate fluctuation on cash and cash
equivalents
5. Net Increase in cash and cash equivalents 413,395,419 224,360,589
Plus: balance at the beginning of the period of cash and cash 532,384,882 493,568,866
equivalents
6. Balance at the end of the period of cash and cash equivalents 945,780,301 717,929,455
Legal Representative: Zhou Hongjiang Accounting Supervisor: Jiang Jianxun Accounting Department M anager:
Jiang Jianxun
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
2.7 Consolidated owne r’s equity changing list
Unit: Yuan
This period
Owners’ equity of the parent company
Item Other equity Minority
Minus: Other General Undistributed Total owners’
instruments Capital shareholders’
Treasury comprehensive Special Surplus equity
Capital stock risk Other Subtotal equity
Preferred Perpetual reserves reserves reserves profits
stock income preparation
stock bonds Other
1. Balance at the end of
685,464,000 565,955,441 2,965,377 342,732,000 8,008,982,547 9,606,099,365 284,388,012 9,890,487,377
last year
Plus: Accounting -3,278,942 -3,278,942 -3,278,942
policies changing
Previous error
correction
Business combination
under common control
Other
2. Balance at the
beginning of this year 685,464,000 565,955,441 2,965,377 342,732,000 8,005,703,605 9,602,820,423 284,388,012 9,887,208,435
3. Increased or
decreased amount in
this period (reducing -3,060,721 192,125,389 189,064,668 -4,190,019 184,874,649
amount is listed with
"-")
3.1 Total -3,060,721 603,403,789 600,343,068 -2,822,044 597,521,024
comprehensive income
3.2 Owners' invested
and reduced capital
3.2.1 Owner’ invested
common stock
3.2.2 Other equity
instrument holders’
invested capital
3.2.3 Amount of shares
paid and reckoned in
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
owners' equity
3.2.4 Other
3.3 Profit distribution -411,278,400 -411,278,400 -1,367,975 -412,646,375
3.3.1 Accrued surplus
reserves
3.3.2 Accrued general
risk preparation
3.3.3 Distribution to
owners (or -411,278,400 -411,278,400 -1,367,975 -412,646,375
shareholders)
3.3.4 Other
3.4 Internal transfer of
owners' equity
3.4.1 Capital reserves
transferred and
increased capital (or
capital stock)
3.4.2 Surplus reserves
transferred and
increased capital (or
capital stock)
3.4.3 Surplus reserves
covering deficit
3.4.4 Retained earnings
carried over from the
benefit plan amount
3.4.5 Retained earnings
carried over from other
comprehensive income
3.4.6 Other
3.5 Special reserves
3.5.1 Withdrawal in this
period
3.5.2 Usage in this
period
3.6 Other
4. Balance at the end of 685,464,000 565,955,441 -95,344 342,732,000 8,197,828,994 9,791,885,091 280,197,993 10,072,083,084
this period
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Last period
Owners’ equity of the parent company
Item Other equity Minority
Minus: Other General Undistributed Total owners’
instruments Capital Special Surplus shareholders’
Capital stock Treasury comprehensive risk Other Subtotal equity
reserves reserves reserves profits equity
Preferred Perpetual stock income preparation
stock bonds Other
1. Balance at the end of 685,464,000 565,955,441 3,109,240 342,732,000 7,309,081,618 8,906,342,299 271,636,379 9,177,978,678
last year
Plus: Accounting
policies changing
Previous error
correction
Business combination
under common control
Other
2. Balance at the 685,464,000 565,955,441 3,109,240 342,732,000 7,309,081,618 8,906,342,299 271,636,379 9,177,978,678
beginning of this year
3. Increased or
decreased amount in
this period (reducing -143,863 699,900,929 699,757,066 12,751,633 712,508,699
amount is listed with
"-")
3.1 Total -143,863 1,042,632,929 1,042,489,066 -1,381,414 1,041,107,652
comprehensive income
3.2 Owners' invested 17,532,823 17,532,823
and reduced capital
3.2.1 Owner’ invested
common stock
3.2.2 Other equity
instrument holders’
invested capital
3.2.3 Amount of shares
paid and reckoned in
owners' equity
3.2.4 Other 17,532,823 17,532,823
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
3.3 Profit distribution -342,732,000 -342,732,000 -3,399,776 -346,131,776
3.3.1 Accrued surplus
reserves
3.3.2 Accrued general
risk preparation
3.3.3 Distribution to
owners (or -342,732,000 -342,732,000 -3,399,776 -346,131,776
shareholders)
3.3.4 Other
3.4 Internal transfer of
owners' equity
3.4.1 Capital reserves
transferred and
increased capital (or
capital stock)
3.4.2 Surplus reserves
transferred and
increased capital (or
capital stock)
3.4.3 Surplus reserves
covering deficit
3.4.4 Retained earnings
carried over from the
benefit plan amount
3.4.5 Retained earnings
carried over from other
comprehensive income
3.4.6 Other
3.5 Special reserves
3.5.1 Withdrawal in this
period
3.5.2 Usage in this
period
3.6 Other
4. Balance at the end of 685,464,000 565,955,441 2,965,377 342,732,000 8,008,982,547 9,606,099,365 284,388,012 9,890,487,377
this period
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
2.8 Owner’s equity changing list of the parent company
Unit: Yuan
This period
Item Other equity instruments M inus: Other Total owners’
Capital Capital Special Surplus Undistributed equity
Preferred Perpetual Treasury comprehensive Other
stock Other reserves reserves reserves profits
stock bonds stock income
1. Balance at the end of last year 685,464,000 557,222,454 342,732,000 8,437,957,128 10,023,375,582
Plus: Accounting policies changing
Previous error correction
Other
2. Balance at the beginning of this year 685,464,000 557,222,454 342,732,000 8,437,957,128 10,023,375,582
3. Increased or decreased amount in this
period (reducing amount is listed with -150,548,922 -150,548,922
"-")
3.1 Total comprehensive income 260,729,478 260,729,478
3.2 Owners' invested and reduced capital
3.2.1 Shareholders’ invested common
stock
3.2.2 Other equity instrument holder’
invested capital
3.2.3 Amount of shares paid and
reckoned in owners' equity
3.2.4 Other
3.3 Profit distribution -411,278,400 -411,278,400
3.3.1 Drew surplus reserves
3.3.2 Distribution to owners (or -411,278,400 -411,278,400
shareholders)
3.3.3 Other
3.4 Internal transfer of owners' equity
3.4.1 Capital reserves transferred and
increased capital (or capital stock)
3.4.2 Surplus reserves transferred and
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
increased capital (or capital stock)
3.4.3 Surplus reserves covering deficit
3.4.4 Retained earnings carried over
from the benefit plan amount
3.4.5 Retained earnings carried over
from other comprehensive income
3.4.6 Other
3.5 Special reserves
3.5.1 Accrual in this period
3.5.2 Usage in this period
3.6 Other
4. Balance at the end of this period 685,464,000 557,222,454 342,732,000 8,287,408,206 9,872,826,660
Unit: Yuan
Last period
Item Other equity instruments M inus: Other Total owners’
Capital Capital Special Surplus Undistributed equity
Preferred Perpetual Treasury comprehensive Other
stock Other reserves reserves reserves profits
stock bonds stock income
1. Balance at the end of last year 685,464,000 557,222,454 342,732,000 7,811,100,555 9,396,519,009
Plus: Accounting policies changing
Previous error correction
Other
2. Balance at the beginning of this year 685,464,000 557,222,454 342,732,000 7,811,100,555 9,396,519,009
3. Increased or decreased amount in this
period (reducing amount is listed with 626,856,573 626,856,573
"-")
3.1 Total comprehensive income 969,588,573 969,588,573
3.2 Owners' invested and reduced capital
3.2.1 Shareholders’ invested common
stock
3.2.2 Other equity instrument holder’
invested capital
3.2.3 Amount of shares paid and
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
reckoned in owners' equity
3.2.4 Other
3.3 Profit distribution -342,732,000 -342,732,000
3.3.1 Drew surplus reserves
3.3.2 Distribution to owners (or
shareholders)
3.3.3 Other
3.4 Internal transfer of owners' equity
3.4.1 Capital reserves transferred and
increased capital (or capital stock)
3.4.2 Surplus reserves transferred and
increased capital (or capital stock)
3.4.3 Surplus reserves covering deficit
3.4.4 Retained earnings carried over
from the benefit plan amount
3.4.5 Retained earnings carried over
from other comprehensive income
3.4.6 Other
3.5 Special reserves
3.5.1 Accrual in this period
3.5.2 Usage in this period
3.6 Other
4. Balance at the end of this period 685,464,000 557,222,454 342,732,000 8,437,957,128 10,023,375,582
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
3. Company profile
Yantai Changyu Pioneer Wine Co., Ltd. (the “Company” or the “Joint-stock Company”) was
incorporated as a joint-stock limited company in accordance with the Company Law of the People’s
Republic of China (the “PRC”) in the merger and reorganization carried out by Yantai Changyu Group
Co., Ltd. (“Changyu Group Company”) with its assets and liabilities in relation to wine business. The
Company and its subsidiary companies (hereinafter collectively referred to as the “Group”) are
engaged in the production and sale of wine, brandy and champagne, planting and purchase of grapes,
development of tourism resources, etc. The registered address of the Company is Yantai City,
Shandong Province, and the office address of the headquarters is 56 Dama Road, Zhifu District, Yantai
City, Shandong Province.
As at June 30, 2019, the Company issued 685,464,000 shares accumulatively. Refer to Note 7.30 for
details.
The parent company of the Group is Changyu Group Company incorporated in China, which was
ultimately and actually controlled by four parties, including Yantai Guofeng Investment Holding Co.,
Ltd., ILLVA Saronno Holding Spa, International Finance Corporation and Yantai Yuhua Investment &
Development Co., Ltd.
The financial statement and the consolidated financial statement of the Company were approved by
the Board of Directors on August 26, 2019.
The details of scope of the consolidated financial statement in this period can be seen in Note 9
“Equity in other entities”. The details of scope changes of the consolidated financial statement in this
period can be seen in Note 8 “Changes of the consolidated scope”.
4. Preparation basis of financial statement
4.1 Preparation basis
The Group implements the Accounting Standards for Business Enterprises (including the new and
revised editions published in 2014) (“ASBE”) published by the Ministry of Finance and relevant
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
regulations thereof.
Note-accounting basis and pricing principle
The note-accounting basis of financial accounting adopted by the Group is accrual system and the
measurement basis adopted by the Group in preparing its financial statement is historical cost.
Subsequently, if the assets are impaired, the impairment provisions are made in accordance with
relevant accounting standards.
When the historical cost measurement is used, the assets are measured by the amount of cash or cash
equivalent when the assets are purchased or the fair value of the consideration. The liabilities are
measured by the actually received funds or assets for performing the current obligations, or the
contract amount for performing the current obligations, or the amount of cash or cash equivalent paid
for anticipated liabilities in the daily activities.
Fair value refers to a price received for selling an asset or paid for transferring a liability by the market
participant in orderly transactions on the measurement date. No matter the fair value is observable or
estimated by the valuation technique, the fair value measured and disclosed in this financial statement
is recognized on this basis.
The fair value measurement is divided into three levels based on the observable degree of the input
fair value and the importance of this input value on the whole fair value measurement:
*The input value of the first level is the unadjusted price of the same assets or liabilities which can be
acquired in an active market on the measurement date.
*The input value of the second level is the directly or indirectly observable input value of relevant
assets or liabilities except that of the first level.
*The input value of the third level is the unobservable input value of relevant assets or liabilities.
4.2 Continuous operation
The Group has appraised the ability of continuous operation for 12 months from June 30, 2019, and no
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
issues or situations causing major doubts to this ability are found. Therefore, this financial statement is
prepared on the basis of the continuous operation assumption.
5. Main accounting policies and accounting estimates
5.1 Statement on compliance with ASBE
This financial statement fulfills the requirement of ASBE and gives a true and integrated view of the
financial status and the consolidated financial status as at June 30, 2019, as well as the operating result,
the consolidated operating result, the cash flow and the consolidated cash flow of the Company from
January to June 2019.
5.2 Accounting period
The accounting period of the Group is from January 1 to December 31.
5.3 Operating cycle
The operating cycle refers to the period from the enterprise purchases the assets used for processing to
the cash or cash equivalent is realized. The operating cycle of the Company is 12 months.
5.4 Recording currency
Since Renminbi (RMB) is the currency of the main economic environment in which the Company and
the domestic subsidiary companies thereof are situated, the Company and the subsidiary companies
thereof adopt RMB as the recording currency. The overseas subsidiary companies thereof determine
EUR, CLP and AUD as the recording currency according to the main economic environment in which
they are situated. The currency in this financial statement prepared by the Group is RMB.
5.5 Accounting treatment method for business combination under common control and
non-common control
5.5.1 Business combination and goodwill under non-common control
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
A business combination under non-common control is a business combination in which all of the
combining enterprises are not ultimately controlled by the same party or parties before and after the
combination.
The combination cost shall be the fair value of the assets paid, the liabilities incurred or assumed or
the equity instruments issued by the acquirer in exchange for the control over the acquiree. The
intermediary expenses such as audit, legal services and assessment consultation and other related
management expenses paid by the acquirer for business combination are included in the current profits
and losses when they occur.
The identifiable assets, liabilities and contingent liabilities which are obtained from the acquiree in the
business combination and meet the recognition conditions shall be measured on the acquisition date
according to the fair value thereof.
Where the cost of combination exceeds the acquirer’s interest in the fair value of the acquiree’s
identifiable net assets, the difference shall be recognized as goodwill as an asset and initially measured
at cost. Where the cost of combination is less than the acquirer’s interest in the fair value of the
acquiree’s identifiable net assets, the acquirer firstly re-assesses the measurement of the fair values of
the acquiree’s identifiable assets, liabilities and contingent liabilities and measurement of the cost of
combination. If after that reassessment, the cost of combination is still less than the acquirer’s interest
in the fair value of the acquiree’s identifiable net assets, the acquirer recognizes the remaining
difference immediately in profit or loss for the current period.
The goodwill formed due to business combination shall be separately listed in the consolidated
financial statement and measured on the basis of the cost minus the accumulative impairment
provision.
5.6 Compiling methods of consolidated financial statement
The consolidation scope of the consolidated financial statement is determined on the basis of control.
Control means that the investor holds the power in the invested party, obtains variable returns by
participating in relevant activities of the invested party and has the ability to affect the amount of the
returns by using the power on the invested party. Once any change of the relevant facts and situations
results in any change of relevant elements of the above definition of Control, the Group will carry out
reappraisal.
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
The merger of any subsidiary company starts from the date when the Group acquires the power to
control this subsidiary company, while the termination of any subsidiary company ends in the date
when the Group losses the power to control this subsidiary company.
As for any subsidiary company obtained in a business combination under non-common control, the
business result and the cash flow thereof since the acquisition date (date of obtaining the control power)
shall have been properly included in the consolidated income statement and the consolidated cash flow
statement.
The principal accounting policies and accounting period adopted by the subsidiary companies shall be
determined in accordance with the accounting policies and accounting period uniformly regulated by
the Company.
The influence of the internal transaction between the Company and the subsidiary companies as well
as among subsidiary companies on the consolidated financial statement shall be neutralized at the time
of combination.
The shares in the owner's equity of the subsidiary companies, which do not belong to the parent
company, shall be recognized as the minority equity and listed under the item of “minority equity” of
the owner’s equity in the balance sheet. The shares in the current profits and losses of the subsidiary
companies, which belong to the minority equity, shall be listed under the item of “minority equity” of
the net profit in the consolidated income statement.
If the loss of the subsidiary companies borne by minority shareholders exceeds the shares of the
owner's equity entitled therein by the minority shareholders at the beginning of the period, the
difference shall be still credited against the minority equity.
5.7 Determination standard of cash and cash equivalents
Cash comprises cash on hand and demand deposit of the Company. Cash equivalents refer to
short-term highly liquid investments held by the Group which are readily convertible into known
amount of cash with an insignificant risk of changes in value.
5.8 Foreign currency transaction and foreign currency state ment translation
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
5.8.1 Foreign currency transaction
At the time of initial recognition of a foreign currency transaction, the amount of the foreign currency
shall be translated into the amount of the recording currency at the spot exchange rate on the
transaction date.
The monetary items of the foreign currency transaction shall be translated into RMB at the spot
change rate on the balance sheet date. The currency translation difference generated by the difference
between the spot change rate on the balance sheet date and the spot change rate at the initial
recognition or on the previous balance sheet date shall be included in the current profits and losses,
except: ① the currency translation difference of the dedicated foreign currency loan that meets the
capitalization condition shall be included in the cost of assets as capitalization during the capitalization
period; ② the currency translation difference of the arbitrage tool to avoid foreign exchange risk shall
be treated according to the hedge accounting method; ③ the currency translation difference of the
available-for-sale monetary items generated by changes of the book balance other than the amortized
cost shall be recognized as other comprehensive income and included in the current profits and losses.
5.8.2 Translation of foreign currency financial statement
In order to compile a consolidated financial statement, the foreign currency financial statement of
overseas business shall be translated into RMB financial statement in accordance with the following
methods: all asset and liability items in the balance sheet shall be translated at the spot exchange rate
on the balance sheet date; the shareholders' equity items, except for the ones as "undistributed profits",
shall be translated at the spot exchange rate at the time when they occur; all items and the items
reflecting the accrual profit distribution in the profit statement shall be translated at the exchange rate
similar to the spot exchange rate at the time when they occur; the undistributed profits at the beginning
of the year shall be the translated to the undistributed profits at the end of the previous year; the
undistributed profits at the end of the year shall be calculated and listed as the translated profit
distribution items; and the difference between the asset items and the sum of the liability items and the
shareholders’ equity items shall be recognized as other comprehensive income and included in the
shareholder's equity.
The foreign currency cash flows and the cash flows of the overseas subsidiary companies shall be
translated at the exchange rate similar to the spot exchange rate at the time when they occur; the
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
amount of the cash and cash equivalents impacted by the exchange rate movement shall be, as a
reconciling item, separately listed under “impact of exchange rate movement on cash and cash
equivalents” in the cash flow statement.
The balance at the beginning of the year and the actual amount of the previous year shall be listed as
the amount translated according to the financial statement of the previous year.
5.9 Financial instruments
When becoming a party to a contract of financial instruments, the Company shall recognize a financial
asset or financial liability.
5.9.1 Classification, recognition and measurement of financial assets
According to the business model of financial assets management and the contractual cash flow
characteristics of financial assets, the Company divides financial assets into: financial assets measured
at amortized cost; financial assets measured at fair value and the variation of which is included in
other comprehensive income; and financial assets measured at fair value and the variation of which is
included in the current profits and losses.
At the time of initial recognition, financial assets shall be measured at their fair value. As for the
financial assets measured at their fair value and the variation of which is included in the current profits
and losses, the transaction expenses thereof shall be directly included in the current profits and losses;
as for other categories of financial assets, the transaction expenses thereof shall be included in initial
recognized cost. For accounts receivable or bills receivable arising from sale of products or provision
of services, which do not contain or do not take into account material financing elements, the
Company shall take the amount of consideration that the Company is entitled to receive as expected as
the initial recognized amount.
① Financial assets measured at amortized cost
The Company manages such financial assets by the following business model: collecting contractual
cash flow as the target, with the contractual cash flow characteristics of such financial assets consistent
with the basic lending arrangement, that is, the cash flow generated on a specific date is only the
payment of principal and interest based on the outstanding principal amount. The Company shall
recognize the interest income of such financial assets by the actual interest rate method, and conduct
subsequent measurement at amortized cost. The profits or losses generated from the amortization or
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
impairment shall be included in the current profits and losses.
② Financial assets measured at fair value and the variation of which is included in other
comprehensive income
The Company manages such financial assets by the following business model: aiming at both
receiving contractual cash flow and selling, with the contractual cash flow characteristics of such
financial assets consistent with the basic lending arrangements. Such financial assets are measured at
fair value and the variation of which is included in other comprehensive income, but impairment
losses or gains, exchange gains and losses and interest income calculated by the effective interest rate
method shall be included in the current profits and losses.
In addition, the Company designates some non-tradable equity instrument investments as financial
assets measured at fair value and the variation of which is included in other comprehensive income.
The Company shall include relevant dividend income of such financial assets in the current profits and
losses, and the fair value changes in other comprehensive income. When the recognition of such
financial assets is terminated the accumulated gains or losses previously recorded in other
comprehensive income will be transferred into retained income from other comprehensive income,
which shall not be included in the current profits and losses.
③ Financial assets measured at fair value and the variation of which is included in the current profits
and losses
The Company divides those financial assets excluding the above financial assets measured at
amortized cost and financial assets measured at fair value and the variation of which is included in
other comprehensive income into financial assets measured at fair value and the variation of which is
included in the current profits and losses, and list as tradable financial assets. In addition, at the time of
initial recognition, in order to eliminate or significantly reduce accounting mismatches, the Company
designates some financial assets as financial assets measured at fair value and the variation of which is
included in the current profits and losses. For such financial assets, the Company adopts fair value for
subsequent measurement, and the variation in fair value shall be included in the current profits and
losses. The financial assets that have matured for more than one year since the balance sheet date and
are expected to be held for more than one year are listed as other non-current financial assets.
5.9.2 Classification, recognition and measurement of financial liabilities
At the time of initial recognition, financial liabilities are divided into financial liabilities measured at
fair value and the variation of which is included in the current profits and losses and other financial
liabilities. As for the financial liabilities measured at fair value and the variation of which is included
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
in the current profits and losses, the transaction expenses thereof shall be directly inc luded in the
current profits and losses; as for other financial liabilities, the transaction expenses thereof shall be
included in initial recognized cost.
①Financial liabilities measured at fair value and the variation of which is included in the current
profits and losses
Financial liabilities measured at fair value and the variation of which is included in the current profits
and losses include tradable financial liabilities (including derivatives belonging to financial liabilities)
and financial liabilities designated as those measured at fair value when initially recognized and the
variation of which is included in the current profits and losses.
Tradable financial liabilities (including derivatives belonging to financial liabilities) shall be
subsequently measured at fair value, and the variation in the fair value shall be included in the current
profits and losses except those related to hedge accounting.
For the financial liabilities designated as those measured at fair value and the variation of which is
included the current profits and losses, the variation in fair value caused by changes in the Company's
own credit risk is included into other comprehensive income, and when the recognition of this liability
is terminated, the accumulated variation in fair value caused by changes in its own credit risk which is
included into other comprehensive income shall be transferred into retained income.
The remaining variations in fair value are included in the current profits and losses. If any accounting
mismatch in profits and losses is caused or enlarged by handling the impact of changes in the own
credit risk of such financial liabilities in the above way, the Company shall include all the gains or
losses of such financial liabilities (including the impact amount of changes in the credit risk of the
enterprise) in the current profits and losses.
② Other financial liabilities
In addition to the financial assets of which the transfer doesn’t meet the conditions to terminate the
recognition or financial liabilities formed by continuous involvement in the transferred financial assets
and other financial liabilities beyond the financial guarantee contract classified as financial liabilities
measured at amortized cost, the financial liabilities shall be measured at the amortized cost for
subsequent measurement, and the profits or losses caused by termination of recognition or
amortization shall be included in the current profits and losses.
5.9.3 Recognition basis and measurement method for the transfer of financial assets
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Where a financial asset meets any of the following requirements, the recognition of it shall be
terminated: ①The contractual rights for collecting the cash flow of the said financial asset are
terminated; ②The financial asset has been transferred and almost all the risks and rewards in the
ownership of the financial asset have been transferred to the transferee; ③The financial asset has been
transferred, although the enterprise has neither transferred nor retained almost all the risks and rewa rds
in the ownership of the financial asset, it has given up its control over the financial asset. If the
enterprise has neither transferred nor retained nearly all the risks and rewards in the ownership of the
financial asset, and has not given up its control over the financial asset, relevant financial asset shall be
recognized according to the extent of its continued involvement in the transferred financial asset, and
relevant liabilities shall be recognized accordingly. The extent of continued involvement in the
transferred financial asset refers to the risk level faced by the enterprise due to the change in the value
of the financial asset.
Where the overall transfer of the financial asset meets the derecognition conditions, the difference
between the book value of the transferred financial asset as well as the consideration received due to
such transfer and the summation of the cumulative amount of the fair value of the asset that is
originally included in other comprehensive income shall be included in the current profits and losses.
Where the partly transfer of a financial asset meets the derecognition conditions of termination, the
book value of the transferred financial asset shall be distributed between the terminated part of the
recognition and the unterminated part of the recognition, and the difference between the sum of the
consideration received as a result of the transfer and the accumulated mount of the changes in the fair
value of the derecognized part that is originally included in other comprehensive income and the
aforesaid distributed book amount shall be included in the current profits and losses.
The Company shall determine whether almost all the risks and rewards in the ownership of the
financial assets sold by means of attached right of recourse or the financial assets that it holds which
are endorsed to transfer have been transferred. Where almost all the risks and rewards in the ownership
of the financial assets have been transferred to the transferee, the recognition of such financial assets
shall be terminated; Where almost all the risks and rewards in the ownership of the financial assets are
retained, the recognition of such financial assets shall not be terminated; If almost all the risks and
rewards in the ownership of the financial assets are neither transferred nor retained, the enterprise shall
continue to judge whether it retains control over the assets and then conduct accounting treatment in
accordance with the principles described in the preceding paragraphs.
5.9.4 Derecognition of financial liabilities
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Where the current obligation of a financial liability (or part thereof) has been discharged, the Company
shall terminate the recognition of such financial liability (or part thereof). If the Company (borrower)
signs an agreement with the lender to replace the original financial liability by assuming the new
financial liability, and the contract terms of the new financial liability are substantially different from
those of the original financial liability, the recognition of the original financial liability shall be
terminated and a new financial liability shall be recognized at the same time. If the Company
substantially modifies the contract terms of the original financial liability (or part thereof), it shall
terminate the recognition of the original financial liability and recognize a new financial liability in
accordance with the revised terms at the same time.
If the recognition of a financial liability (or part of it) is terminated, the Company shall record the
difference between its book value and the consideration paid (including the transferred non-cash assets
or liabilities assumed) into the current profits and losses.
5.9.5 Offsetting of financial assets and financial liabilities
Where the Company has a legal right that is currently enforceable to set off the recognized amount of
financial assets and financial liabilities, and intends either to settle on a net basis, or to realise the
financial assets and clear off the financial liabilities simultaneously, the f inancial assets and financial
liabilities shall be offset and the net amount is presented in the balance sheet. Except for the above
circumstances, financial assets and financial liabilities shall be presented separately in the balance
sheet and shall not be offset.
5.9.6 Determination method of the fair value of financial assets and liabilities
The fair value refers to the price that market participants need to pay to receive or transfer a
liability when selling an asset in an orderly transaction that takes place on the measurement
date. Where there is an active market for a financial instrument, the Company shall determine
its fair value by the quotation in the active market. Quotations in the active market are prices
that are readily available from exchanges, brokers, trade associations, pricing services, etc., on
a regular basis, which represent the prices of actual market transactions that occur in fair trade.
Where there is no active market for financial instruments, the Company shall use valuation
techniques to determine their fair value. Valuation techniques include referring to prices used
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
in recent market transactions by parties familiar with the situation and willing to trade, current
fair values of other financial instruments that are substantially the same, discounted cash flow
method, option pricing models, etc. At the time of valuation, the Company adopts valuation
techniques applicable to the current situation and supported by sufficient available data and
other information, selects input values consistent with the asset or liability characteristics
considered by market participants in the transaction of related assets or liabilities, and gives
priority to relevant observable input values as far as possible. When relevant observable input
values can’t be obtained or are not practicable to obtain, the non- inputable values shall be
used.
5.9.7 Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of the Company
after deducting all of its liabilities. The Company issues (including refinancing), repurchases, sells or
cancels equity instruments as changes in equity, and transaction costs related to equity transactions are
deducted from the equity. The Company does not recognize any variation in the fair value of equity
instruments.
Dividends paid on the Company's equity instruments during their existence (including the “interest”
generated by the instruments classified as equity instruments) shall be treated as profit distribution.
5.9.8 Impairment of financial assets
For financial assets measured at amortized cost and debt instrument investments measured at fair value
and whose changes are included in other comprehensive income, the Company shall recognize
provision for losses on the basis of expected credit losses.
The Company takes reasonable and reliable information about past events, current situation and
forecast of future economic situation into consideration, calculates the probability weighted amount of
the present value of the difference between the cash flow receivable of the contract and the cash flow
expected to be received based on the weight of the risk of default, and recognizes the expected credit
losses.
On each balance sheet date, the Company measures the expected credit losses of financial instruments
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
at different stages respectively. If the credit risk of the financial instrument does not increase
significantly after the initial recognition, in the first stage, the Company shall measure the provision
for losses according to the expected credit losses in the next 12 months; If the credit risk of a financial
instrument has increased significantly since the initial recognition, but no credit impairment has
occurred, in the second stage, the Company shall measure the provision for losses according to the
expected credit loss of the entire duration of the instrument; If the credit impairment of a financial
instrument has occurred since the initial recognition, in the third stage, the Company shall measure the
provision for losses according to the expected credit loss of the entire duration of the instrument.
For financial instruments with low credit risk on the balance sheet date, the Company assumes that the
credit risk has not increased significantly since the initial recognition, and measures the provision for
losses according to the expected credit loss in the next 12 months.
For the financial instruments in the first and second stages and with low credit risk, the Company
calculates the interest income according to the book balance without deduction of impairment
provision at the actual interest rate. For financial instruments in the third stage, interest income is
calculated according to the book balance minus the amortized cost at the actual interest rate after the
provision for impairment has been accrued.
When an individual financial asset can’t evaluate the information of the expected credit loss at a
reasonable cost, the Company divides the receivables into several combinations according to the
characteristics of credit risk, and calculates the expected credit loss on the basis of the combination.
For bills receivable and accounts receivable, no matter whether there is a significant financing
component, the Company measures the provision for losses according to the expected credit loss
throughout the duration.
For the bills receivable divided into portfolio, the Company calculates the expected credit loss by
referring to the historical credit loss experience, combining the current situation as well as the forecast
of the future economic situation, and through the default risk exposure and the expected credit loss
rate of the entire duration.
For the accounts receivable divided into portfolio, the Company calculates the expected credit loss by
referring to the historical credit loss experience, combining the current situation as well as the forecast
of the future economic situation, and formulating the comparison table of the overdue days of accounts
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
receivable and the expected credit loss rate of the whole duration.
For other receivables divided into portfolio, the Company calculates the expected credit loss by
referring to the historical credit loss experience, combining the current situation as well as the forecast
of the future economic situation, and through the default risk exposure and the expected credit loss
rate within the next 12 months or the entire duration.
The Company will include the accrued or transferred-back provision for losses in the current profits
and losses. For debt instruments that are measured at fair value and the variation of which is included
in other comprehensive income, the Company shall adjust other comprehensive income while
including impairment loss or profit in the current profits and losses.
5.10 Inventories
5.10.1 Categories of inventories
The inventories of the Group mainly include raw materials, goods in process and finished goods.
Inventories are initially measured at cost. Inventory costs include purchase costs, processing costs and
other expenses incurred to bring inventory to its current location and condition.
The agricultural products harvested are treated in accordance with the Accounting Standard for
Business Enterprises No.1 – Inventories.
5.10.2 Valuation method of inventories upon delivery
The actual cost of inventories upon delivery is calculated by the weighted average method.
5.10.3 Determination basis for net realisable value of inventories
On the balance sheet date, inventories are measured at the lower of cost and net realisable value. If
the net realisable value is below the cost of inventories, a provision for decline in value of inventories
is made. Net realisable value is the estimated selling price in the ordinary course of business less the
estimated costs of completion, the estimated costs necessary to make the sale and relevant taxes. Net
realisable value is determined on the basis of clear evidence obtained, and takes into consideration the
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
purposes of holding inventories and effect of post balance sheet events.
Provision for decline in value of other inventories is made based on the excess of cost of inventory
over its net realisable value on an item-by-item basis.
After the provision for decline in value of inventories is made, if the circumstances that previously
caused inventories to be written down below cost no longer exist so that the net realisable value of
inventories is higher than their cost, the original provision for decline in value is reversed and the
reversal is included in profit or loss for the period.
5.10.4 Inventory count system
The perpetual inventory system is maintained for stock system.
5.10.5 Amortization method for low cost and short-lived consumable items and
packaging materials
Packaging materials and low cost and short-lived consumable items are amortized using the immediate
write-off method.
5.11 Non-current assets held for sale
Non-current assets and disposal groups are classified as held for sale category when the Group
recovers the book value through a sale (including an exchange of nonmonetary assets that has
commercial substance) rather than continuing use.
Non-current assets or disposal groups classified as held for sale are required to satisfy the following
conditions: (1) the asset or disposal group is available for immediate sale in its present condition
subject only to terms that are usual and customary for sales of such asset or disposal group; (2) the sale
is highly probable, i.e. the Group has made a resolution about selling plan and obtained a confirmed
purchase commitment and the sale is expected to be completed within one year.
The Group measures the no-current assets or disposal groups classified as held for sale at the lower of
their carrying amount and fair value less costs to sell. Where the carrying amount is higher than the net
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
amount of fair value less costs to sell, carrying amount should be reduced to the net amount of fair
value less costs to sell, and such reduction is recognized in impairment loss of assets and included in
profit or loss for the period. Meanwhile, provision for impairment of held-for-sale assets are made.
When there is increase in the net amount of fair value of non-current assets held for sale less costs to
sell On the balance sheet date, the original deduction should be reversed in impairment loss of assets
recognized after the classification of held-for-sale category, and the reverse amount is include in profit
or loss for the period.
Non-current assets held for sale in non-current assets are not subject to depreciation or amortization.
5.12 Long-term equity investments
5.12.1 Judgment basis of control, joint control and significant influence
Control is the power to govern the financial and operating policies of an entity so as to obtain benefits
from its activities. Joint control is the contractually agreed sharing of control over an economic activity,
and exists only when the strategic financial and operating policy decisions relating to the activity
require the unanimous consent of the parties sharing control. Significant influence is the power to
participate in the financial and operating policy decisions of the investee but is not control or joint
control over those policies. When determining whether an investing enterprise is able to exercise
control or significant influence over an investee, the effect of potential voting rights of the investee
(for example, warrants and convertible debts) held by the investing enterprises or other parties that are
currently exercisable or convertible shall be considered.
5.12.2 Determination of initial investment cost
For a long-term equity investment acquired not involving enterprises under common control, the
investment cost of the long-term equity investment is the cost of acquisition.
Audit fee, legal services, evaluation and consulting fees and other related management costs in
acquisition are expensed in profits and losses when happened.
Other long-term equity investments acquired from other than acquisitions are recognized using
original cost.
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
5.12.3 Subsequent measurement and recognition of profit or loss
Long-term equity investment accounted for using the cost method
The financial statement of the Company accounts for long-term equity investment using the cost
method. A subsidiary is an investee that is controlled by the Group.
Under the cost method, a long-term equity investment is measured at initial investment cost.
Long-term equity investment is adjusted when capital is added or recollected. Investment income is
recognized in the period in accordance with the attributable share of cash dividends or profit
distributions declared by the investee.
5.12.4 Disposal of long-term equity investments
On disposal of a long-term equity investment, the difference between the proceeds actually received
and receivable and the carrying amount is recognized in profit or loss for the period.
5.13 Investment properties
Investment property is property held to earn rentals or for capital appreciation or both.
An investment property is measured initially at cost. Subsequent expenditures incurred for such
investment property are included in the cost of the investment property if it is probable that economic
benefits associated with an investment property will flow to the Group and the subsequent
expenditures can be measured reliably. Other subsequent expenditures are recognized in profit or loss
in the period in which they are incurred.
The Group uses the cost model for subsequent measurement of investment properties, and adopts a
depreciation or amortization policy for the investment property which is consistent with that for
buildings or land use rights.
When an investment property is sold, transferred, retired or damaged, the Group recognizes the
amount of any proceeds on disposal net of the carrying amount and related taxes in profit or loss for
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
the period.
5.14 Fixed assets
5.14.1 Recognition condition
Fixed assets are tangible assets that are held for use in the production or supply of goods or services,
for rental to others, or for administrative purposes, and have useful lives of more than one accounting
year. A fixed asset is recognized only when it is probable that economic benefits associated with the
asset will flow to the Group and the cost of the asset can be measured reliably. Fixed assets are
initially measured at cost.
Subsequent expenditures incurred for the fixed asset are included in the cost of the fixed asset and if it
is probable that economic benefits associated with the asset will flow to the Group and the subsequent
expenditures can be measured reliably. Meanwhile the carrying amount of the replaced part is
derecognized. Other subsequent expenditures are recognized in profit or loss in the period in which
they are incurred.
5.14.2 Depreciation method
A fixed asset is depreciated over its useful life using the straight-line method since the month
subsequent to the one in which it is ready for intended use. The useful life, estimated net residual
value rate and annual depreciation rate of each category of fixed assets are as follows:
Depreciation Residual value Annual depreciation
Classification Depreciation method
life rate rate
Straight-line
Houses and buildings 20-40 years 0-5% 2.4%-5.0%
depreciation
Straight-line
5-30 years 0-5% 3.2%-20.0%
Machinery equipment depreciation
Straight-line
4-12 years 0-5% 7.9%-25.0%
Transportation tools depreciation
Estimated net residual value assumes the situation where a fixed asset expire for its estimated useful
life and is in its expected final status. Estimated net residual value is the amount that the Group can
obtain from the disposal less expected disposal fees.
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
5.14.3 Other explanations
If a fixed asset is upon disposal or no future economic benefits are expected to be generated from its
use or disposal, the fixed asset is derecognized. When a fixed asset is sold, transferred, retired or
damaged, the amount of any proceeds on disposal of the asset net of the carrying amount and related
taxes is recognized in profit or loss for the period.
The Group reviews the useful life and estimated net residual value of a fixed asset and the depreciation
method applied at least once at each financial year-end, and account for any change as a change in an
accounting estimate.
5.15 Construction in progress
Construction in progress is measured at its actual costs. The actual costs include various construction
expenditures during the construction period, borrowing costs capitalised before it is ready for intended
use and other relevant costs. Construction in progress is not depreciated. Construction in progress
is transferred to a fixed asset when it is ready for intended use.
5.16 Borrowing costs
Borrowing costs directly attributable to the assets meeting the capitalization conditions during the
acquisition, construction or production shall be capitalized when expenditures for such asset and
borrowing costs are incurred and activities relating to the acquisition, construction or production of the
asset that are necessary to prepare the asset for its intended use or sale have commenced.
Capitalization of borrowing costs shall be terminated when the qualifying asset being acquired,
constructed or produced becomes ready for its intended use or sale. Capitalization of borrowing costs
is suspended during the period in which the acquisition, construction or production of a qualifying
asset is suspended abnormally and when the suspension is for a continuous period of more than 3
months, until the acquisition, construction or production of the asset is resumed. Other borrowing
costs are recognized as an expense in the period in which they are incurred.
The interest expenses actually incurred in the current period of the special loan shall be capitalized
after deducting the interest income obtained by depositing the unused loan funds into the bank or the
investment income obtained from the temporary investment.
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
5.17 Biological assets
The biological assets of the Group are productive biological assets.
Productive biological assets are biological assets, for example, held for the production of agricultural
produce, provision of services or leasing Productive biological assets in the Group are vines to
produce grapes. A productive biological asset is initially measured at cost. The cost of a productive
biological asset self-grown or self-bred comprises those costs necessarily incurred and directly
attributable to the asset before the asset becomes available for its intended production and operating
purposes, and any borrowing cost meeting the capitalisation criteria.
The productive biological assets are not accrued depreciation until reaching the intended production
and operation purposes. After reaching the intended production and operation purposes, the productive
biological assets are accrued depreciation within the service life straight-line depreciation. The service
life, estimated net residual value rate and annual depreciation rate of different productive biological
assets are as follows:
Category Useful life Estimated net residual rate Annual depreciation rate
Vines 20 years 5.0%
The Group evaluates the useful life and expected net salvage value by considering the normal
producing life of the productive biological assets.
The Group reviews the useful life and estimated net residual value of productive biological assets and
the depreciation method applied at least once at each financial year-end, and account for any change as
a change in an accounting estimate.
On the sale, identification of any shortages during stocktaking, death or damage of biological asset, the
proceeds on disposal net of the carrying amount and relevant taxes is recognized in profit or loss for
the current period.
5.18 Intangible assets
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Intangible assets include land use right, software, trademark, etc.
An intangible asset is measured initially at cost method. When an intangible asset with a finite useful
life is available for use, its original cost less net residual value and any accumulated impairment losses
is amortized over its estimated useful life using the straight-line method. Intangible assets with
indefinite useful lives are not amortized. The useful lives of the intangible assets are as follows:
Category Useful life Estimated net residual rate Annual amortization rate
Land use right 40-50 years - 2%-2.5%
Software 5-10 years - 10%-20%
Trademark 10 years 10%
Except for the above intangible assets with finite useful life, the Group also has land use right and
trademark use right with infinite useful lives. Land use right with infinite useful life refers to the
permanent land property right held by the Company for purchasing by Via Indómita, S.A., Via Dos
Andes, S.A., and Bodegas Santa Alicia SpA. (collectively referred to as the "Chile Indomita Wine
Group") and Kilikanoon Estate Pty Ltd (hereinafter referred to as “Australian Kilikanoon Estate”)
according to related Chilean and Australian law, which doesn’t need to be amortized. Trademark use
right refers to the trademark held by the Group for purchasing Chile Indomita Wine Group and
Australian Kilikanoon Estate, which has no finite useful life. The valuation of trademark use right is
based on the trends in the market and competitive environment, product cycle, and managing
long-term development strategy. Those basis indicated the trademark will provide net cash flows to the
Group within a given period. Because it was hard to predict the period that it would bring economic
benefits to the Group, the useful lives were uncertain.
For an intangible asset with a finite useful life, the Group reviews the useful life and Amortization
method at the end of the period, and makes adjustments when necessary.
5.19 Impairment of long-term assets
The Group and the Company review the impairment status of long-term equity investments, fixed
assets, investment real estate, construction in progress, productive biological asset and intangible
assets with finite useful life at the end of each year. If the assets exist impairment, the Group estimates
the recoverable amount of the assets. Intangible assets with indefinite useful life and intangible assets
not yet available for use are tested for impairment annually, irrespective of whether there is any
indication that the assets may be impaired.
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Recoverable amount is estimated on individual basis. If it is not practical to estimate the recoverable
amount of an individual asset, the recoverable amount of the asset group to which the asset belongs
will be estimated. The recoverable amount of an asset is the higher of its fair value less costs of
disposal and the present value of the future cash flows expected to be derived from the asset.
If recoverable amount of assets is less than book value, the difference is recognized as impairment
provision and expensed in current period.
Goodwill is tested for impairment at least at the end of each year. For the purpose of impairment
testing, goodwill is considered together with the related assets group (s), i.e., goodwill is reasonably
allocated to the related assets group (s) or each of assets group (s) expected to benefit from the
synergies of the combination. An impairment loss is recognized if the recoverable amount of the assets
group or sets of assets groups (including goodwill) is less than its carrying amount. The impairment
loss is firstly allocated to reduce the carrying amount of any goodwill allocated to such assets group or
sets of assets groups, and then to the other assets of the group pro-rata on the basis of the carrying
amount of each asset (other than goodwill) in the group.
The impairment is recognized in profit or loss for the period in which it is incurred and will not be
reversed in any subsequent period.
5.20 Long-term unamortized expenses
The Long-term unamortized expenses are amortized evenly over the period of estimated earnings, and
the long-term unamortized expenses of the Group are amortized over the following period:
Amortization period
Land requisition fee 50 years
Land lease prepayment 50 years
Greening fee 5-20 years
Leasehold improvement 3-5years
Other 3 years
5.21 Employee remuneration
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
5.21.1 Accounting treatments of short-te rm remuneration
In an accounting period in which an employee has rendered service to the Group, the Group
recognizes the actual long-term remuneration for that service as a liability, and includes in the current
profits and losses or the related asset costs. Employee welfare expenses incurred by the Group shall be
recorded into the current profits and losses or related asset costs according to the actual amount.
Non-monetary employee benefits are measured at fair value.
Social insurances such as medical insurance, injury insurance and pregnancy insurance, housing funds,
labor union and employee education fees paid by the Group for employees, are recognized as relevant
liability in the period in which the employees provide service, in accordance with the regulated
recognition basis and percentage. The related expenditures are included in the current profits and
losses or related asset costs.
5.21.2 Accounting treatments of retired benefits
Retired benefits of the Group are all predetermined provision plan.
In the period in which the employees provide service, the Group recognize liability in accordance with
the amounts to be paid calculated according to the predetermined provision plan, and the related
expenditures are either included in cost of related assets or charged to profit or loss in the period when
they are incurred.
5.21.3 Accounting treatments of termination benefits
When providing termination benefits to employees, the Group recognize employee benefits payroll
resulting from termination benefits at the earlier of: the Group cannot unilaterally withdraw from the
termination plan or the redundancy offer; the Group recognize relevant costs and expenses related to
the payment of termination benefits in reconstructuring.
5.22 Revenue
5.22.1 Revenue from sale of goods
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Revenue from sale of goods is recognized when the Group has transferred to the buyer the significant
risks and rewards of ownership of the goods. The Group retains neither continuing managerial
involvement to the degree usually associated with ownership nor effective control over the goods sold.
The amount of revenue can be measured reliably and it is probable that the associated economic
benefits will flow to the Group. The associated costs incurred or to be incurred can be measured
reliably.
5.22.2 Revenue from rendering of services
When the outcome of a transaction involving the rendering of services can be estimated reliably,
revenue associated with the transaction shall be recognized by reference the stage of completion of the
transaction at the reporting date. The outcome of a transaction can be estimated reliably.
When the outcome of the transaction involving the rendering of services cannot be estimated reliably,
revenue is recognized only to the extent of the costs incurred that will be recoverable, and the costs
incurred are recognized as expenses for the period. When it is not probable that the costs incurred will
be recovered, revenue is not recognized.
5.23 Government grants
Government grants are transfer of monetary assets and non-monetary assets from the government to
the Group at no consideration. A government grant is recognized only when the Group can comply
with the conditions attaching to the grant and the Group will receive the grant.
Monetary government grants are measured by the amount received or receivable.
5.23.1 Judgment basis and accounting treatments of government grant related to an
asset
A government grant related to an asset is recognized as deferred income, and evenly amortized to
profit or loss over the useful life of the related asset.
5.23.2 Judgment basis and accounting treatments of government grant related to income
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
For a government grant related to income, if the grant is a compensation for related expenses or losses
to be incurred in subsequent periods, the grant is recognized as deferred income, and recognized in
profit or loss over the periods in which the related costs are recognized. If the grant is a compensation
for related expenses or losses already incurred, the grant is recognized immediately in profit or loss for
the period.
A government grant related to the Group's daily activities is recognized in other income based on the
nature of economic activities; a government grant is not related to the Group's daily activities is
recognized in non-operating income and expenses.
The Company's government loans with below-market rate of interest are directly paid to the Company,
and the related low rate interest will write off related borrowing costs. The government loans with
below-market rate of interest obtained by other subsidiaries of the Group are government loans, which
is provided by local bureau of finance through bank with below-market rate of interest. The actual
amount of the loan received by the Group recognized as borrowings, and the related borrowing costs
are calculated according to the principal of the loan and the below-market rate.
5.24 Deferred income tax assets/deferred income tax liabilities
The income tax expenses include current income tax and deferred income tax.
5.24.1 Current income tax
On the balance sheet date, current income tax liabilities (or assets) for the current and prior periods are
measured at the amount expected to be paid (or recovered) according to the requirements of tax laws.
5.24.2 Deferred income tax assets and deferred income tax liabilities
For temporary differences between the carrying amounts of certain assets or liabilities and their tax
base, or between the nil carrying amount of those items that are not recognized as assets or liabilities
and their tax base that can be determined according to tax laws, deferred income tax assets and
liabilities are recognized using the balance sheet liability method.
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Deferred tax is generally recognized for all temporary differences. Deferred income tax assets for
deductible temporary differences are recognized to the extent that it is probable that taxable profits
will be available against which the deductible temporary differences can be utilised. However, for
temporary differences associated with the initial recognition of goodwill and the initial recognition of
an asset or liability arising from a transaction (not a business combination) that affects neither the
accounting profit nor taxable profits (or deductible losses) at the time of transaction, no deferred tax
asset or liability is recognized.
For deductible losses and tax credits that can be carried forward, deferred income tax assets are
recognized to the extent that it is probable that future taxable profits will be available against which
the deductible losses and tax credits can be utilised.
Deferred income tax liabilities are recognized for taxable temporary differences associated with
investments in subsidiaries and associates, and interests in joint ventures, except where the Group is
able to control the timing of the reversal of the temporary difference and it is probable that the
temporary difference will not reverse in the foreseeable future. Deferred income tax assets arising
from deductible temporary differences associated with such investments and interests are only
recognized to the extent that it is probable that there will be taxable profits against which to utilise the
benefits of the temporary differences and they are expected to reverse in the foreseeable future.
On the balance sheet date, deferred income tax assets and liabilities are measured at the tax rates,
according to tax laws, that are expected to apply in the period in which the asset is realised or the
liability is settled.
Current and deferred tax expenses or income are recognized in profit or loss for the period, except
when they arise from transactions or events that are directly recognized in other comprehensive
income or in shareholders' equity, in which case they are recognized in other comprehensive income or
in shareholders' equity; and when they arise from business combinations, in which case they adjust the
carrying amount of goodwill.
On the balance sheet date, the carrying amount of deferred income tax assets is reviewed and reduced
if it is no longer probable that sufficient taxable profits will be available in the future to allow the
benefit of deferred income tax assets to be utilised. Such reduction in amount is reversed when it
becomes probable that sufficient taxable profits will be available.
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
5.24.3 Net off of income taxes
When the Group has a legal right to settle on a net basis and intends either to settle on a net basis or to
realise the assets and settle the liabilities simultaneously, current tax assets and current tax liabilities
are offset and presented on a net basis.
When the Group has a legal right to settle current tax assets and liabilities on a net basis, and deferred
income tax assets and deferred income tax liabilities relate to income taxes levied by the same taxation
authority on either the same taxable entity or different taxable entities which intend either to settle
current tax assets and liabilities on a net basis or to realise the assets and liabilities simultaneously, in
each future period in which significant amounts of deferred income tax assets or liabilities are
expected to be reversed, deferred income tax assets and deferred income tax liabilities are offset and
presented on a net basis.
5.25 Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the
risks and rewards of ownership to the lessee. All other leases are classified as operating leases.
5.25.1 Ope rating lease accounting treatments
The Group as lessee under operating leases
Operating lease payments are recognized on a straight-line basis over the term of the relevant lease,
and are either included in the cost of related asset or charged to profit or loss for the period. Initial
direct costs incurred are charged to profit or loss for the period.
The Group as lessor under operating leases
Rental income from operating leases is recognized in profit or loss on a straight-line basis over the
term of the relevant lease. Initial direct costs with more than an insignificant amount are capitalised
when incurred, and are recognized in profit or loss on the same basis as rental income over the lease
term. Other initial direct costs with an insignificant amount are charged to profit or loss in the period
in which they are incurred. Contingent rents are charged to profit or loss in the period in which they
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
actually arise.
5.26 Changes in major accounting policies and accounting estimates
5.26.1 Changes in major accounting policies
Content and reason of accounting policy
Examination and approval procedure Remarks
change
In 2017, the M inistry of Finance issued
the revised Accounting Standards for
Enterprises No.22–Recognition and
Measurement of Financial Instruments,
Accounting Standards for Enterprises
No.23–Transfer of Financial Assets,
Accounting Standards for Enterprises
No.24 –Hedging and Accounting
In the consolidated balance sheet on
Standards for Enterprises No.37-
January 1, 2019, the accounts receivable
Presentation of Financial Instruments
changed from RM B 242,153,083 to RM B
(hereinafter referred to as “New
237,781,161; the deferred income tax
Financial Instruments Standards”). From Approved by the second meeting of the
assets were changed from RM B
January 1, 2019, the Group conducted eighth Board of Directors.
285,436,259 to RM B 286,529,239; and
accounting treatment in accordance with
the undistributed profit was changed from
the above newly revised standards.
RM B 8,008,982,547 to RM B
According to the linkage provisions, no
8,005,703,605.
adjustment will be made to the
information during the comparable
period. The undistributed profits at the
beginning of this reporting period will be
retroactively adjusted based on the
difference between the new standards
and the existing standards on the first day
of implementation.
According to the requirements in the
Notice on Revising, Printing &
Distributing Financial Report Format for
General Enterprises in 2019 (Cai Kuai
[2019]No. 6), in the balance sheet, the
item of “bills receivable and accounts
receivable” shall be divided into “bills
receivable” and “accounts receivable”;
The change of accounting policy has no
and the item of “bills payable and Approved by the second meeting of the
impact on the merger and the net profit of
accounts payable” shall be divided into eighth Board of Directors.
the Company and the owner's equity.
“bills payable” and “accounts payable”;
in the income statement, the item of
“R&D expenses” not only reflects the
expensed expenditure incurred in the
research and development process, but
also includes the amortization of
self-developed intangible assets listed in
the item of “management expenses”.
5.26.2 Changes in major accounting estimates
Nil
5.26.3 Particulars of first imple mentation of New Financial Instruments Standards, ne w
income standards, and ne w lease standards to adjust the first imple mentation of related
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
items in the financial statements at the beginning of the year
Consolidated Balance Sheet
Unit: Yuan
Item December 31, 2018 January 1, 2019 Adjusted amount
Bills receivable 288,667,988 -288,667,988
Accounts receivable 242,153,083 237,781,161 -4,371,922
Receivables financing 288,667,988 288,667,988
Available-for-sale financial 467,251 -467,251
assets
Other non-current financial 467,251 467,251
assets
Deferred income tax assets 285,436,259 286,529,239 1,092,980
Undistributed profit 8,008,982,547 8,005,703,605 -3,278,942
Total owner’s equity 9,606,099,365 9,602,820,423 -3,278,942
Explanation for adjustment:
Unit: Yuan
Impact of the
Book value listed Book value listed
New Impact of changes in
according to the original according to the new
Item Financial presentation of other
standards on December 31, standards on January 1,
Instrument financial statements
2018 2019
Standards
Bills receivable and 530,821,071 -530,821,071
accounts receivable
Bills receivable -288,667,988 288,667,988
Accounts receivable -4,371,922 242,153,083 237,781,161
Receivables financing 288,667,988 288,667,988
Available-for-sale 467,251 -467,251
financial assets
Other non-current 467,251 467,251
financial assets
Deferred income tax 285,436,259 1,092,980 286,529,239
assets
Total 816,724,581 -3,278,942 813,445,639
Balance Sheet of the Parent Company
Unit: Yuan
Item December 31, 2018 January 1, 2019 Adjusted amount
Bills receivable 39,885,254 -39,885,254
Accounts 1,447,973 1,447,973
receivable
Receivables
39,885,254 39,885,254
financing
Total owner’s 10,023,375,582 10,023,375,582
equity
Explanation for adjustment:
Unit: Yuan
Book value listed Impact of the Impact of changes Book value listed
according to the original New in presentation of according to the new
Item
standards on December 31, Financial other financial standards on January 1,
2018 Instrument statements 2019
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Standards
Bills receivable and 41,333,227 -41,333,227
accounts receivable
Bills receivable -39,885,254 39,885,254
Accounts receivable 1,447,973 1,447,973
Receivables financing 39,885,254 39,885,254
Other receivables 1,025,643,356 1,025,643,356
Total 1,066,976,583 1,066,976,583
5.27 Other
Critical judgments in applying accounting policies and key assumptions and uncertainties in
accounting estimates
In the application of accounting policies as set out in Note 4, the Group is required to make judgments,
estimates and assumptions about the carrying amounts of items in the financial statements that cannot
be measured accurately, due to the internal uncertainties of the operating activities. These judgments,
estimates and assumptions are based on historical experience of the Group's management as well as
other factors that are considered to be relevant. Actual results may differ from these estimates.
The Group periodically reviews the judgments, estimates and assumptions above on a going concern
basis. For those changes in accounting policies that only affect current financial statements, the
influences are recognized in current period. For those changes in accounting policies that affect both
current and future financial statements, the influences are recognized in both current and prospective
periods.
Key assumption and uncertainties in accounting estimates
The following are key assumptions for after balance sheet date event and other factors of uncertain
estimation. They may cause material adjustment on balance sheet in following accounting period.
Deferred income tax assets recognized by deductible loss
Deferred income tax assets are recognized for all unused tax losses to the extent that it is probable that
taxable profit will be available against which the losses can be utilized. Significant management
judgment is required to determine the amount of deferred income tax assets that can be recognized,
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
based upon the likely timing and level of future taxable profits together with future tax planning
strategies.
Depreciation of fixed assets
The depreciation is calculated on the straight line basis to write-off the cost of each item of fixed
assets to its residual value over its estimated useful life. The Group's management determines the
estimated useful lives for its fixed assets. This estimate is based on the historical experience of the
actual useful lives of fixed assets of similar nature and functions. If the previous estimates have
significant changes, depreciation expenses will be adjusted in the future period.
Impairment of long-term assets
The Group assesses whether the recoverable amount is lower than the book value. If there are any
indicators that the book value of non-current assets cannot be fully recoverable, impairment losses
should be recorded.
The recoverable amount is the higher of an asset's fair value less costs to sell and the present value of
the future cash flows expected to be derived from an asset. As it is difficult for the Group to obtain
the quoted market price of the assets (or assets group), the fair value of the assets cannot be reliably
estimated. When estimating the present value of future cash flows, it is necessary to make important
judgments about the output, selling price, related operating costs, discount rate used in calculating the
present value of the asset (or asset group), etc. In estimating the recoverable amount, the Group uses
all readily available information, including projections of production volumes, selling prices and
associated operating costs based on reasonable and supportable assumptions.
Inventory depreciation provision accrued based on net realizable value
The inventories are measured on the lower of carrying value and net realizable value, and provision
should be made for impairment on obsolete and slow moving inventories. The Group will reassess
whether the net realizable value is lower than the carrying cost at the end of each year.
Preparation for the measurement of the fair value of identifiable assets and liabilities of the
acquiree from a business combination
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
For the cost of business combination, the Group allocates the purchase price based on the fair value of
the identifiable assets and liabilities of the acquiree on the date of acquisition. When measuring the fair
value of the above identifiable assets and liabilities in accordance with the present value of future cash
flow, the management of the Group needs to estimate the sales growth rate based on the supply and
demand situation of the future market to forecast the cash flow, and consider to choose the appropriate
discount rate for the discount. The management may use significant accounting estimates and
judgments in the progress.
6. Taxes
6.1 The main taxes and tax rates are as follows:
Tax category Taxation basis Tax rates
Value added tax Levied on the balance between the
13%, 9% 6% (Chinese), 20%
output tax calculated based on taxable
(France), 21% (Spain), 19% (Chile),
income and the input tax allowed to be
10% (Australia)
deducted in current period
Consumption tax Levied on taxable income 10%, 20% (Chinese)
City development tax Levied on circulation tax actually paid 7% (Chinese)
Corporate income tax Levied on taxable income 25%(Chinese), 33.3%(France), 28%
(Spain), 27% (Chile), 30%
(Australia)
6.2 Tax incentives and relative pe rmit
Ningxia Changyu Grape Growing Co., Ltd.("Ningxia Growing"), a subsidiary of the Group, whose
principal activity is grape growing is incorporated in Ningxia Huizu Autonomous Region. According
to clause 27 of PRC Corporate Income Tax and clause 86 of PRC Corporate Income Tax Measures for
Implementation, Ningxia Growing enjoys an exemption of corporate income tax.
Yantai Changyu Grape Growing Co., Ltd.(" Grape Growing "), a branch of the Company, whose
principal activity is grape growing is incorporated in Zhifu District, Yantai City, Shandong Province.
According to clause 27 of PRC Corporate Income Tax and clause 86 of PRC Corporate Income Tax
Measures for Implementation, Grape Growing enjoys an exemption of corporate income tax.
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Xinjiang Tianzhu Co., Ltd ("Xinjiang Tianzhu"), a subsidiary of the Company, is an enterprise of wine
production and sales incorporated in Shihezi city, Xinjiang Weizu Autonomous. In accordance with the
Notice on Tax Policy Issues concerning Further Implementation of the Western China Development
Strategy (Cai Shui [2011] No.58), Xinjiang Tianzhu is qualified to enjoy preferential taxation policies,
which means it can pay corporate income tax at a preferential rate of 15% for the period from 2015 to
2020.
Xinjiang Babao Baron Chateau Co., Ltd. ("Shihezi Chateau"), a subsidiary of the Company, is an
enterprise of wine production and sales incorporated in Shihezi city, Xinjiang Weizu Autonomous. In
accordance with the Notice on Tax Policy Issues concerning Further Implementation of the Western
China Development Strategy (Cai Shui [2011] No.58), Shihezi Chateau is qualified to enjoy
preferential taxation policies, which means it can pay corporate income tax at a preferential rate of
15% for the period from 2015 to 2020.
7. Notes to items in the consolidated financial statement
7.1 Monetary capital
Unit: Yuan
Item Ending balance Beginning balance
Cash on hand 70,198 114,335
Bank deposit 1,756,744,006 1,382,399,749
Other monetary capital 91,818,749 93,186,393
Total 1,848,632,953 1,475,700,477
As at June 30, 2019, the restricted bank deposit details are listed as follows:
Unit: Yuan
Item Ending balance Beginning balance
Housing fund of the unit 2,647,877 2,611,350
Total 2,647,877 2,611,350
As at June 30, 2019, the details of other monetary funds are listed as follows:
Unit: Yuan
Item Ending balance Beginning balance
Pledge of fixed deposits by Yantai
Changyu Wine Research,
46,100,000 46,100,000
Development and M anufacture Co.,
Ltd. (“R&D Company”)
Guaranteed deposits paid for the letter
44,540,850 44,540,850
of credit
Account balance of Alipay 1,042,367 2,483,816
Guaranty money for the unit card 125,532 51,727
Guaranty money for ICBC platform 10,000 10,000
Total 91,818,749 93,186,393
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
As at June 30, 2019, the bank deposits of the Group including short-term fixed deposits ranging from
3 months to 12 months amounted to RMB 180,439,250 Yuan (December 31, 2018: RMB 173,042,400
Yuan), with the interest rates ranging from 1.40% to 2.03%.
7.2 Bills receivable
7.2.1 Classification of bills receivable
Unit: Yuan
Type Ending balance Beginning balance
Bank acceptance 288,667,988
Trade acceptance
Total 288,667,988
7.2.2 Provision for bad debts accrued, withdrawn or transferred back in this period
Nil
7.2.3 Bills receivable pledged by the Company at the end of period
Nil
7.2.4 Bills receivable endorsed or discounted by the Company at the end of period but
not yet matured as of the balance sheet date
Unit: Yuan
Amount terminating recognition at the end Amount not terminating recognition
Item
of period at the end of period
Bank acceptance 275,760,494
Trade acceptance
Total 275,760,494
7.2.5 Bills receivable reclassified as accounts receivable by the Company due to the
default of drawe r at the end of period
Nil
7.2.6 Bills receivable actually cancelled after verification in this period
Nil
7.3 Accounts receivable
7.3.1 Accounts receivable disclosed by type
Unit: Yuan
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Ending balance Beginning balance
Provision for bad Provision for bad
Book balance Book balance
Type debts debts
Book value Book value
Amount Proportion Amount Accrued Amount Proportion Amount Accrued
proportion proportion
Accounts
receivable for
which
provision for
242,153,083 100% 242,153,083
bad debts is
accrued on a
single item
basis
Including:
Accounts
receivable for
which
provision for
191,269,049 100% 5,137,857 2.78% 186,131,192
bad debts is
accrued on a
combined
basis
Including:
Accounts
receivable for
which
provision for
191,269,049 100% 5,137,857 2.78% 186,131,192
bad debts is
accrued by
credit risk
features
Total 191,269,049 100% 5,137,857 2.78% 186,131,192 242,153,083 100% 242,153,083
Provision for bad debts accrued on a combined basis:
Unit: Yuan
Ending balance
Name
Book balance Provision for bad debts Accrued proportion
Accounts receivable for which
provision for bad debts is 191,269,049 5,137,857 2.78%
accrued by credit risk features
Total 191,269,049 5,137,857 --
Disclosed by age:
Unit: Yuan
Age Ending balance
Within 1 year (including) 180,854,504
1-2 years 8,978,048
2-3 years 1,199,269
Over 3 years 237,228
Total 191,269,049
As at June 30, 2019, the accounts receivable with ownership restrictions were RMB 31,134,017 Yuan
(December 31, 2018: RMB 52,015,032 Yuan). Please refer to Note 7.18 for details.
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
7.3.2 Provision for bad debts accrued, withdrawn or transferred back in this period
Provision for bad debts accrued in this period:
Unit: Yuan
Adjusted Changes in t his period
Beginning amount in the
balance of first Beginning
the original implementation balance of the Withdrawn Ending
Type or
financial of the New year after Accrued Cancelled balance
instruments Financial adjustment transferred
standards Instruments back
Standards
Accounts
receivable for
which provision
4,371,922 4,371,922 765,935 5,137,857
for bad debts is
accrued by credit
risk features
Total 4,371,922 4,371,922 765,935 5,137,857
There were no provision for bad debts withdrawn or transferred back in this period.
7.3.3 Accounts receivable actually cancelled after verification in this period
Nil
7.3.4 Accounts receivable collected by the borrowe rs of top 5 units ranked by the ending
balance
Unit: Yuan
Relationship with the Percentage in total
Unit Amount Period
Company accounts receivable
Nonggongshang
Supermarket (Group) Co., Third party 10,077,717 Within 1 year 5.3%
Ltd.
Suguo Supermarket Co., Ltd. Third party 7,168,620 Within 1 year 3.7%
Viedos y Bodegas Las
Third party 6,917,840 Within 1 year 3.6%
Pircas
Lianhua Supermarket Third party 5,408,819 Within 1 year 2.8%
Holdings Co., Ltd.
MARKS AND SPENCER Third party 5,365,322 Within 1 year 2.8%
Total -- 34,938,318 -- 18.3%
7.3.5 Accounts receivable terminating recognition due to transfer of financial assets
Nil
7.3.6 Accounts receivable transferred and included in assets and liabilities
Nil
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
7.4 Receivables financing
Unit: Yuan
Item Ending balance Beginning balance
Bank acceptance 372,281,872
Total 372,281,872
7.5 Advance payment
7.5.1 Advance payment listed by age
Unit: Yuan
Ending balance Beginning sum
Age
Amount Proportion Amount Proportion
Within 1 year 3,490,928 100% 4,219,949 100%
1-2 years
2-3 years
M ore than 3 years
Total 3,490,928 -- 4,219,949 --
7.5.2 Advance payment collected by the prepaid parties of top 5 units ranked by the
ending balance
Unit: Yuan
Percentage
Relationship with in the total
Category of client Amount Age Reason for unsettlement
the Group advance
payment%
Within 1
Ningxia Vangarie Wine Co., Ltd. Third party 600,000 Failure to receive the goods 17.2%
year
Yantai Power Supply Company of State
Within 1 Prepaid electricity
Grid Shandong Electric Power Third party 500,000 14.3%
year purchasing fund
Company
Within 1
DONELLI VINI S.P.A. Third party 463,523 Failure to receive the goods 13.3%
year
YEDA Thermal Power Construction & Within 1
Third party 250,545 Failure to receive the goods 7.2%
Installation Engineering Co., Ltd. year
Yantai Deyi Hardware M echanical & Within 1
Third party 192,045 Failure to receive the goods 5.5%
Electrical Co., Ltd. year
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Total -- 2,006,113 -- -- 57.4%
7.6 Other receivables
Unit: Yuan
Item Ending balance Beginning balance
Interest receivable 2,099,109 1,332,681
Dividends receivable
Other receivables 26,519,874 21,303,405
Total 28,618,983 22,636,086
7.6.1 Inte rest receivable
Unit: Yuan
Item Ending balance Beginning balance
Fixed deposit 2,099,109 1,332,681
Entrusted loan
Bond investment
Total 2,099,109 1,332,681
7.6.2 Other receivables
7.6.2.1 Other receivables classified by nature
Unit: Yuan
Nature Ending book balance Beginning book balance
Deposit and guaranty money receivable 9,991,516 10,453,624
Imprest receivable 2,776,485 2,274,038
Accounts receivable from related parties 1,911,880 813,440
Consumption tax and added-value tax export rebate 9,651,893 6,273,882
Other 2,188,100 1,488,421
Total 26,519,874 21,303,405
7.6.2.2 Disclosed by age
Unit: Yuan
Age Ending balance
Within 1 year (including) 15,284,516
1-2 years 1,162,933
2-3 years 8,302,579
M ore than 3 years 1,769,846
Total 26,519,874
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
7.6.2.3 Provision for bad debts accrued, withdrawn or transferred back in this period
The provision for bad debts accrued in this period was RMB 0 Yuan; and that withdrawn or
transferred back in this period was RMB 0 Yuan.
7.6.2.4 Other receivables actually cancelled after verification in this period
Nil
7.6.2.5 Othe r receivables collected by the borrowe rs of top 5 units ranked by the ending
balance
Unit: Yuan
Percentage in total Ending balance of
Ending
Unit Nature Age ending balance of other provision for bad
balance
accounts receivable debts
Construction
YEDA Construction Industry guaranty
7,709,477 Within 3 years 29.10%
Association
money
Lease
Yantai God Horse Packing Co.,
payment 1,626,880 Within 1 year 6.10%
Ltd. Printing Branch receivable
Yantai Zhongya M edical Health Lease
payment 285,000 Within 1 year 1.10%
Wine Co., Ltd.
receivable
Guaranty
YEDA Finance Bureau 198,056 Within 1 year 0.70%
money
Yantai Power Supply Company
of State Grid Shandong Electric Deposit 80,000 Within 1 year 0.30%
Power Company
Total -- 9,899,413 -- 37.30%
7.6.2.6 Accounts receivable involving government s ubsidies
Nil
7.6.2.7 Othe r receivables that are terminated for recognition due to transfer of financial
assets
Nil
7.6.2.8 Other receivables transferred and then included in assets and liabilities
Nil
7.7 Inventories
7.7.1 Inventory classification
Unit: Yuan
Item Ending balance Beginning balance
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Depreciation Depreciation
Book balance Book value Book balance Book value
provision provision
Raw materials 88,705,179 88,705,179 67,267,035 67,267,035
Goods in process 1,837,958,108 1,837,958,108 1,787,819,923 1,787,819,923
Commodity stocks 698,652,646 18,534,497 680,118,149 894,187,725 24,683,226 869,504,499
Total 2,625,315,933 18,534,497 2,606,781,436 2,749,274,683 24,683,226 2,724,591,457
7.7.2 Inventory depreciation provision
Unit: Yuan
Increase in this period Decrease in this period
Beginning
Item Transfer back or Ending balance
balance Accrual Other Other
write-off
Raw materials
Goods in process
Commodity stocks 24,683,226 6,148,729 18,534,497
Total 24,683,226 6,148,729 18,534,497
7.8 Other current assets
Unit: Yuan
Item Ending balance Beginning balance
Prepaid corporate income tax 70,523,939 24,077,323
Deductible input tax 229,478,097 233,087,707
Rent to be amortized 416,865 1,511,366
Total 300,418,901 258,676,396
7.9 Other non-current financial assets
Unit: Yuan
Item Ending balance Beginning balance
Other 515,922
Total 515,922
7.10 Investment real estate
7.10.1 Investment real estate by cost measurement method
Unit: Yuan
Houses and Construction in
Item Land use right Total
buildings progress
Ⅰ Original book value
1. Beginning balance 70,954,045 70,954,045
2. Increase in this period
2.1 Outsourcing
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Houses and Construction in
Item Land use right Total
buildings progress
2.2 Transfer in from
inventories\fixed assets\
construction in progress
2.3 Business merger
increase
3. Decrease in this period
3.1 Disposal
3.2 Other transfer out
4. Ending balance 70,954,045 70,954,045
Ⅱ Accumulated depreciation
& accumulated amortization
1. Beginning balance 39,381,556 39,381,556
2. Increase in this period 1,012,019 1,012,019
2.1 Accrual or
1,012,019 1,012,019
amortization
3. Decrease in this period
3.1 Disposal
3.2 Other transfer out
4. Ending balance 40,393,575 40,393,575
Ⅲ Impairment provision
1. Beginning balance
2. Increase in this period
2.1 Accrual
3. Decrease in this period
3.1 Disposal
3.2 Other transfer out
4. Ending balance
Ⅳ Book value
1. Ending book value 30,560,470 30,560,470
2. Beginning book value 31,572,489 31,572,489
7.11 Fixed assets
Unit: Yuan
Item Ending balance Beginning balance
Fixed assets 5,684,612,653 5,749,731,667
Disposal of fixed assets
Total 5,684,612,653 5,749,731,667
7.11.1 Particulars of fixed assets
Unit: Yuan
Houses and
Item M achinery equipment Construction tools Total
buildings
Ⅰ Original book value:
1. Beginning balance 4,761,426,425 2,665,798,814 26,580,639 7,453,805,878
2. Increase in this period 33,949,084 48,642,164 1,281,845 83,873,093
2.1 Acquisition 4,174,052 13,254,325 1,281,845 18,710,222
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Houses and
Item M achinery equipment Construction tools Total
buildings
2.2 Transfer in from
29,775,032 35,387,839 65,162,871
construction in progress
2.3 Business merger
increase
3. Decrease in this period 5,422,920 2,867,114 456,453 8,746,487
3.1 Disposal or
5,422,920 2,867,114 456,453 8,746,487
retirement
4. Ending balance 4,789,952,589 2,711,573,864 27,406,031 7,528,932,484
Ⅱ Accumulated depreciation
1. Beginning balance 621,266,769 1,062,064,237 20,743,205 1,704,074,211
2. Increase in this period 67,239,979 79,376,506 1,071,000 147,687,485
2.1 Accrual 67,239,979 79,376,506 1,071,000 147,687,485
3. Decrease in this period 4,489,447 2,518,788 433,630 7,441,865
3.1 Disposal or
4,489,447 2,518,788 433,630 7,441,865
retirement
4. Ending balance 684,017,301 1,138,921,955 21,380,575 1,844,319,831
Ⅲ Impairment provision
1. Beginning balance
2. Increase in this period
2.1 Accrual
3. Decrease in this period
3.1 Disposal or
retirement
4. Ending balance
Ⅳ Book value
1. Ending book value 4,105,935,288 1,572,651,909 6,025,456 5,684,612,653
2. Beginning book value 4,140,159,656 1,603,734,577 5,837,434 5,749,731,667
As at June 30, 2019, the net value of the fixed assets with ownership restrictions was RMB
353,013,613 Yuan (December 31, 2018: RMB 412,006,421 Yuan). Please refer to Note 7.51
for details.
7.11.2 Particulars of te mporarily idle fixed assets
Unit: Yuan
Original book Accumulated Depreciation
Item Book value Remarks
value depreciation reserves
Temporarily idle fixed
124,758,075 67,762,891 56,995,184
assets
7.11.3 Particulars of fixed assets under finance leases
Nil
7.11.4 Fixed assets under operating lease
Unit: Yuan
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
Item Ending book value
M achinery equipment 115,720
7.11.5 Particulars of fixed assets without property certificates
Unit: Yuan
Reason for not receiving the property
Item Book value
certificate
Industrial Production Center of the R&D Company 1,733,732,977 Under transaction
Dormitory Building, M ain Building and Reception Building of
280,709,011 Under transaction
Chang’an Chateau
European Town, M ain Building and Service Building of Beijing
184,687,307 Under transaction
Chateau
M ain Building of Yantai Chateau Changyu Tinlot 81,685,892 Under transaction
Fermentation Workshop and Wine Storage Workshop of Xinjiang
17,499,421 Under transaction
Tianzhu
Office Building and Packaging Workshop of Icewine Valley 9,044,465 Under transaction
Wine-making Workshop of Changyu (Jingyang) 4,017,018 Under transaction
Office Building, Laboratory Building and Workshop of
3,572,175 Under transaction
Fermentation Center
Finished Goods Warehouse and Workshop of Kylin Packaging 2,351,511 Under transaction
Office Building of Guangxi Guilin Office and Office Building of
1,110,076 Under transaction
Shanxi Datong Office
Total 2,318,409,853 Under transaction
7.12 Construction in progress
7.12.1 Particulars of construction in progress
Ending balance Beginning balance
Item Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Research, Development & M anufacture
Center (“Changyu Wine City 672,975,492 672,975,492 608,553,617 608,553,617
Complex”)
Construction Project of Chang’an
17,537,828 17,537,828 39,793,893 39,793,893
Chateau
Construction Project of Ningxia
47,371,353 47,371,353 47,163,863 47,163,863
Chateau
Construction Project of Shihezi
379,517 379,517 23,664,124 23,664,124
Chateau
Construction Project of Sales Company 19,145,181 19,145,181 17,985,882 17,985,882
Construction Projects of Other
32,463,002 32,463,002 22,135,212 22,135,212
Companies
Total 789,872,373 789,872,373 759,296,591 759,296,591
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annualFinancial Report
7.12.2 Changes of major construction in progress in this pe riod
Unit: Yuan
Transferred Proportion of Accumulative Including:
Other Capitalization
Beginning Increase in to fixed accumulative capitalized capitalized amount
Item Budget decrease in Ending balance ratio of interest Capital source
balance this period assets in this project input in amount of of interest in this
this period in this period
period budget interest period
Loans form financial
Changyu Wine City 1.20% and institutions and
4,505,780,000 608,553,617 105,008,609 30,903,286 9,683,448 672,975,492 76.60% 16,954,039
Complex 4.3% self-raised funds
Construction Project of Self-raised funds
620,740,000 39,793,893 7,523,270 29,779,335 17,537,828 109.90%
Chang’an Chateau
Construction Project of Self-raised funds
780,000,000 23,664,124 4,615,627 138,172 27,762,062 379,517 96.90%
Shihezi Chateau
Construction Project of Self-raised funds
161,350,000 17,985,882 1,262,622 103,323 19,145,181 98.50%
Sales Company
Construction Project of Self-raised funds
41,415,000 47,163,863 207,490 47,371,353 102.60%
Ningxia Chateau
6,109,285,000 737,161,379 118,617,618 60,924,116 37,445,510 757,409,371 -- -- 16,954,039 --
Total
As at June 30, 2019, there was no indication for impairment of construction in progress of the Group, so no provision for impairment was made.
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
7.13 Productive biological assets
7.13.1 Productive biological assets by cost measurement method
Unit: Yuan
Item Plantation Total
Immature M ature
Ⅰ Original book value
1. Beginning balance 13,837,608 235,246,042 249,083,650
2. Increase in this period -4,798,454 9,593,745 4,795,291
2.1 Outsourcing
2.2 Self cultivation 2,388,310 2,406,981 4,795,291
The immature turn to the mature -7,186,764 7,186,764
3. Decrease in this period
3.1 Disposal
3.2 Other
4. Ending balance 9,039,154 244,839,787 253,878,941
Ⅱ Accumulated depreciation
1. Beginning balance 39,817,277 39,817,277
2. Increase in this period 6,448,225 6,448,225
2.1 Accrual 6,448,225 6,448,225
3. Decrease in this period
3.1 Disposal
3.2 Other
4. Ending balance 46,265,502 46,265,502
Ⅲ Impairment provision
1. Beginning balance
2. Increase in this period
2.1 Accrual
3. Decrease in this period
3.1 Disposal
3.2 Other
4. Ending balance
Ⅳ Book value
1. Ending book value 9,039,154 198,574,285 207,613,439
2. Beginning book value 13,837,608 195,428,765 209,266,373
As at June 30, 2019, no ownership of the biological assets was restricted.
As at June 30, 2019, there was no indication for impairment of biological assets of the Group, so no
provision was made.
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
7.14 Intangible assets
7.14.1 Particulars of intangible assets
Unit: Yuan
Item Land use right Software use right Trademark Total
Ⅰ Original book value
1. Beginning balance 528,252,911 75,822,057 170,068,735 774,143,703
2. Increase in this period 16,176 107,993 124,169
2.1 Acquisition 16,176 107,993 124,169
2.2 Internal R&D
2.3 Business merger
increase
3. Decrease in this period
3.1 Disposal
4. Ending balance 528,269,087 75,930,050 170,068,735 774,267,872
Ⅱ Accumulated amortization
1. Beginning balance 78,070,910 26,722,815 13,876,519 118,670,244
2. Increase in this period 5,231,260 3,185,493 21,989 8,438,742
2.1 Accrual 5,231,260 3,185,493 21,989 8,438,742
3. Decrease in this period
3.1 Disposal
4. Ending balance 83,302,170 29,908,308 13,898,508 127,108,986
Ⅲ Impairment provision
1. Beginning balance
2. Increase in this period
2.1 Accrual
3. Decrease in this period
3.1 Disposal
4. Ending balance
Ⅳ Book value
1. Ending book value 444,966,917 46,021,742 156,170,227 647,158,886
2. Beginning book value 450,182,001 49,099,242 156,192,216 655,473,459
As at June 30, 2019, the net value of the intangible assets with ownership restrictions was
RMB 215,282,924 Yuan (December 31, 2018: RMB 218,070,414 Yuan). Please refer to
Note 7.51 for details.
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
7.14.2 Particulars of land use right of that not receiving the property ce rtificate
Nil
7.15 Goodwill
Unit: Yuan
Name of the invested Increase in this period Decrease in this period
Beginning
unit or matter forming Formed by business Ending balance
balance Other Disposal Other
goodwill merger
Etablissements Roullet
Fransac (“Roullet 13,112,525 13,112,525
Fransac”)
Dicot Partners, S.L
92,391,901 92,391,901
(“Atrio Group”)
Societe Civile
Argricole Du Chateau
15,761,440 15,761,440
De M irefleurs
(“M irefleurs”)
Indomita Wine
6,870,115 6,870,115
Company Chile, SpA
Kilikanoon Estate,
37,063,130 37,063,130
Australia
Total 165,199,111 165,199,111
7.16 Long-term unamortized expenses
Unit: Yuan
Increase in this Amortization in this
Item Beginning balance Other decrease Ending balance
period period
Land lease fees 54,217,763 1,073,811 53,143,952
Land acquisition
43,427,739 215,293 43,212,446
fees
Afforestation fees 141,224,472 9,683,449 4,615,467 146,292,454
Renovation costs 775,647 27,762,062 476,300 28,061,409
Other 4,994,795 1,134,446 281,791 5,847,450
Total 244,640,416 38,579,957 6,662,662 276,557,711
Remarks: The amount transferred to long-term unamortized expenses from construction in
progress was RMB 38,234,356 Yuan.
7.17 Deferred income tax assets/liabilities
7.17.1 Un-offset deferred income tax assets
Unit: Yuan
Ending Balance Beginning Balance
Item Deductible Deductible
Deferred income Deferred income
temporary temporary
tax assets tax assets
difference difference
Unrealized profits from inter-company
383,079,453 95,769,863 602,476,583 150,619,145
transactions
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Ending Balance Beginning Balance
Item Deductible Deductible
Deferred income Deferred income
temporary temporary
tax assets tax assets
difference difference
Unpaid bonus 107,118,804 26,808,863 141,808,257 35,485,814
Dismission welfare 21,108,526 5,277,132 26,186,243 6,546,561
Asset impairment provision 23,672,354 5,918,088 24,683,226 6,170,807
Deductible loss 326,241,084 83,564,280 262,937,999 67,566,387
Deferred income 78,596,149 17,132,928 86,227,293 18,868,963
Asset valuation impairment 649,811 175,449 661,415 178,582
Total 940,466,181 234,646,603 1,144,981,016 285,436,259
7.17.2 Un-offset deferred income tax liabilities
Unit: Yuan
Ending Balance Beginning Balance
Item Taxable Taxable
Deferred income Deferred income
temporary temporary
tax liabilities tax liabilities
difference difference
Assets appraisal appreciation in business merger
69,392,888 18,629,612 81,338,130 22,010,647
under non-common control
Total 69,392,888 18,629,612 81,338,130 22,010,647
7.17.3 Details of unconfirme d deferred income tax assets
Unit: Yuan
Item Ending balance Beginning balance
Deductable temporary difference
Deductible loss 157,722,738 171,430,831
Total 157,722,738 171,430,831
7.17.4 Deductible losses of unconfirmed deferred income tax assets will expire in:
Unit: Yuan
Year Ending sum Beginning sum Remark
2020 45,960,766 45,960,766
2021 82,685,213 82,685,213
2022 14,362,787 14,362,787
2023 6,987,182 21,110,792
2024 7,726,790
Total 157,722,738 164,119,558 --
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
7.18 Short-term loans
7.18.1 Classification of short-term loans
Unit: Yuan
Item Ending balance Beginning balance
Pledge loan
M ortgage loan 65,507,517 79,467,832
Guaranteed loan 7,145,835 3,331,870
Fiduciary loan 605,517,315 605,202,708
Total 678,170,667 688,002,410
As at June 30, 2019, the mortgage loans referred to a loan of factoring business for accounts
receivable of EUR 3,982,860 (equivalent to RMB 31,134,017 Yuan) that Hacienda y Vinedos
Marques del Atrio, S.L.U. (“Marques del Atrio”) transacted in such banks as Banco de
Sabadell, S.A. (December 31, 2018: RMB 52,015,032 Yuan), a loan of USD 5,000,000
(equivalent to RMB 34,373,500 Yuan) that Indomita Wine Company Chile, SpA borrowed
from BBVA bank by mortgage of its fixed assets of CLP 2,931,854,000 (equivalent to RMB
29,904,911 Yuan) (December 31, 2018: RMB 27,452,800 Yuan). The guaranteed loan
referred to a loan borrowed by the Company from Australia & New Zealand Banking with a
guarantee for Kilikanoon Estate, Australia of AUD 1,483,893 (equivalent to RMB 7,145,835
Yuan) (December 31, 2018: RMB 3,331,870 Yuan).
7.19 Accounts payable
7.19.1 List of accounts payable
Unit: Yuan
Item Ending balance Beginning balance
Trade accounts payable 539,459,878 713,572,881
Total 539,459,878 713,572,881
7.19.2 Explanation of significant accounts payable aged more than one year
As at June 30, 2019, there were no significant accounts payable aged more than one year.
7.20 Advances from customers
7.20.1 List of advances from customers
Unit: Yuan
Item Ending sum Beginning sum
Advances from customers 177,549,080 226,075,244
Total 177,549,080 226,075,244
7.20.2 Advances from customers of significant amount aged more than one year
As at June 30, 2019, the Company had no advances from customers of significant amount
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
aged more than one year.
7.21 Employee remunerations payable
7.21.1 List of employee remune rations payable
Unit: Yuan
Increase in this Decrease in this
Item Beginning balance Ending balance
period period
1. Short-term remuneration 185,893,109 214,884,524 245,100,514 155,677,119
2. Post-employment welfare – defined
224,865 27,605,713 27,149,855 680,723
contribution plan
3. Dismission welfare 26,186,243 1,310,247 6,387,964 21,108,526
4.Other welfare due within one year
Total 212,304,217 243,800,484 278,638,333 177,466,368
7.21.2 List of short-term remunerations
Unit: Yuan
Increase in this Decrease in this
Item Beginning balance Ending balance
period period
1. Salaries, bonuses, allowances
187,685,990 188,388,623 215,640,569 160,434,044
and subsidies
2. Staff welfare 3,014,288 4,969,229 7,875,107 108,410
3. Social insurance charges 461,095 14,314,931 14,435,562 340,464
Including: M edical insurance 460,440 12,510,735 12,656,526 314,649
Injury insurance 655 914,251 889,091 25,815
M aternity insurance 889,945 889,945
4. Housing fund 52,510 6,147,006 6,191,272 8,244
5. Union fee and staff education fee 1,914,079 1,064,735 1,033,635 1,945,179
6. Short-term compensated
absences
7. Short-term profit-sharing plan
M inus: Those divided into
7,234,853 75,631 7,159,222
non-current assets
Total 185,893,109 214,884,524 245,100,514 155,677,119
7.21.3 List of defined contribution plan
Unit: Yuan
Item Beginning balance Increase Decrease Ending balance
1. Basic endowment insurance 224,533 26,914,033 26,457,843 680,723
2. Unemployment insurance 332 691,680 692,012
3. Enterprise annuity payment
Total 224,865 27,605,713 27,149,855 680,723
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
7.21.4 Dismission welfare
Unit: Yuan
Item Beginning balance Increase Decrease Ending balance
1. Compensation for server of labor 1,275,387 1,275,387 -
relation
2. Compensation for early retirement 26,186,243 34,860 5,112,577 21,108,526
Total 26,186,243 1,310,247 6,387,964 21,108,526
7.22 Taxes and dues payable
Unit: Yuan
Item Ending balance Beginning balance
Value added tax 28,114,274 36,442,868
Consumption tax 9,089,447 28,636,646
Corporate income tax 59,137,357 40,869,507
Individual income tax 276,031 5,669,099
Urban maintenance and construction tax 2,407,009 4,337,712
Property tax 5,406,700 5,165,128
Urban land use tax 2,255,344 2,476,527
Other 2,314,640 5,315,303
Total 109,000,802 128,912,790
7.23 Other payables
Unit: Yuan
Item Ending balance Beginning balance
Interest payable 2,669,667 712,826
Dividends payable 412,646,375
Other payables 562,350,965 607,767,064
Total 977,667,007 608,479,890
Remarks: Other payables in the above list refer to the payables after deducting interest
payable and dividends payable.
7.23.1 Inte rest payable
Unit: Yuan
Item Ending balance Beginning balance
Interest of long-term loans with interest paid by
installment and principal paid on maturity
Interest of corporate bonds
Interest payable of short-term loans 2,669,667 712,826
Interest of preferred shares\ perpetual bonds
divided into financial liabilities
Other
Total 2,669,667 712,826
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
7.23.2 Dividends payable
Unit: Yuan
Item Ending balance Beginning balance
Ordinary stock dividends 411,278,400
Preferred stock dividends/sustainable debt dividends
divided into equity instruments
Other 1,367,975.00
Total 412,646,375.00
7.23.3 Other payables
7.23.3.1 Other payables listed by nature
Unit: Yuan
Item Ending balance Beginning balance
Dealer’s deposit payable 166,741,693 159,191,138
Equipment purchase and construction costs
93,902,789 152,825,734
payable
Transportation charges payable 15,579,562 38,867,725
Trademark use fees payable for Changyu Group
78,414,978
Company
Advertisement marketing expenses payable 209,606,196 96,429,861
Employee cash deposit 869,282 2,806,766
Supplier’s deposit payable 18,732,029 15,901,210
Contracting fees payable 19,130,850 27,070,584
Other 37,788,564 36,259,068
Total 562,350,965 607,767,064
7.23.3.2 Other significant accounts payable aged more than one year
Unit: Yuan
Item Ending balance Cause of unpayment or carry -over
Beijing Qinglang Ecological Agriculture
Technology Development Co., Ltd. (“Beijing 3,513,506 The contracting fees haven’t been settled
Qinglang”)
VASF Company 4,878,866 The contracting fees haven’t been settled
Total 8,392,372 --
7.24 Non-current liabilities due within one year
Unit: Yuan
Item Ending balance Beginning balance
Long-term loans due within one 146,362,314 118,940,788
year
Bonds payable due within one year
Long-term accounts payable due 34,000,000 34,000,000
within one year
Lease liabilities due within one
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
year
Total 180,362,314 152,940,788
7.25 Other current liabilities
Unit: Yuan
Item Ending balance Beginning balance
Short-term bonds payable
Refunds payable
Deferred income 14,545,254 15,860,254
Total 14,545,254 15,860,254
7.26 Long-term loans
7.26.1 Classification of long-term loans
Unit: Yuan
Item Ending balance Beginning balance
Pledge loan
M ortgage loan 3,529,655 3,924,916
Guaranteed loan 98,156,000 110,750,000
Fiduciary loan 64,263,595 41,805,746
Total 165,949,250 156,480,662
Description of the classification of long-term loans:
Unit: Yuan
Item Ending balance Long-term loan due within one Long-term loan due over one
year year
Pledge loan
M ortgage loan 6,616,377 3,086,722 3,529,655
Guaranteed loan 116,906,000 18,750,000 98,156,000
Fiduciary loan 188,789,187 124,525,592 64,263,595
Total 312,311,564 146,362,314 165,949,250
As at June 30, 2019, the guaranteed loan referred to the long-term loan of RMB 68,750,000
Yuan borrowed by the Company for the R&D Company by means of credit guarantee
(December 31, 2018: 81,250,000 Yuan), which was borrowed from Australia & New Zealand
Banking by the Company for Kilikanoon Estate, Australia of AUD 10,000,000 (equivalent to
RMB 48,156,000 Yuan) (December 31, 2018: 48,250,000 Yuan). The mortgage loan referred
to the loan of EUR 678,868 (equivalent to RMB 5,306,710 Yuan) borrowed from Popular
Espaol by Marques del Atrio by mortgaging its fixed assets of EUR 2,900,925 (equivalent to
RMB 22,676,531 Yuan) (December 31, 2018: RMB 6,749,944 Yuan). Kilikanoon Estate,
Australia borrowed a loan of AUD 271,963 (equivalent to RMB 1,309,667 Yuan) by pledging
its fixed assets of AUD 503,163 (equivalent to RMB 2,423,032 Yuan) from NAB bank
(December 31, 2018: RMB 48,250,000 Yuan).
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
7.27 Long-term accounts payable
7.27.1 Long-term accounts payable listed by nature
Unit: Yuan
Item Ending balance Beginning balance
China Agricultural Development Key Construction Fund 201,000,000 225,000,000
Total 201,000,000 225,000,000
In 2016, Agricultural Development Fund invested RMB 305,000,000 Yuan in the Research,
Development & Manufacture Company, accounting for 37.9% of the registered capital.
According to the investment agreement, it is agreed that Agricultural Development Fund will
take back the investment fund in ten years and obtain fixed income according to year, which
is 1.2% of the remaining principal. Except for the above fixed income, the Agricultural
Development Fund shall not enjoy other profits of the Research, Development & Manufacture
Company or bear the losses of the Research, Development & Manufacture Company.
Accordingly, the investment of the Agricultural Development Fund in the Research,
Development & Manufacture Company is equity investment nominally, which is debt
investment (finance discount interest loan) in deed. The Group included the investment of the
Agricultural Development Fund in long-term accounts payable measured by amortized cost.
From January to June 2019, the Group gave back the principal of RMB 24,000,000 Yuan.
Refer to Note 7.51 for details of mortgaged and pledged assets.
Unit: Yuan
Balance of long-term accounts Long-term accounts payable Long-term accounts payable due in one
payable due within one year year later
235,000,000 34,000,000 201,000,000
7.28 Deferred income
Unit: Yuan
Increase in this Decrease in this
Item Beginning balance Ending balance Forming reason
period period
Governmental
86,227,293 4,465,398 12,096,542 78,596,149
subsidy
M inus: Those
included in current 15,860,254 1,315,000 14,545,254
liabilities
Non-current
70,367,039 4,465,398 10,781,542 64,050,895 --
liabilities
Projects related to gove rnme ntal subsidy
Unit: Yuan
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Amount
of Amount Amount
Amount
subsidy included in included in
Beginning offset Other Ending Related to
Item of liabilities newly non-operating other
balance the cost changes balance assets/income
increased revenue in income in expenses
in this this period this period
period
Grape bulk wine
3,304,500 717,450 2,587,050 Related to assets
brewing project
Reward for investment
in fixed assets of
6,996,600 1,140,000 5,856,600 Related to assets
Chateau Shihezi
project
Industrial revitalization
and technical
transformation project 15,642,000 711,000 14,931,000 Related to assets
in Xinjiang
Special subsidy for
supporting 4,240,000 530,000 3,710,000 Related to assets
infrastructure
Tourism development Related to
500,000 500,000 income
fund subsidy project
Construction project of
grape brewing
3,200,000 200,000 3,000,000 Related to assets
production capacity
(Huanren)
Electronic traceability
2,525,257 333,527 2,191,730 Related to assets
system project of wine
Wine industry
558,000 93,000 465,000 Related to assets
development project
Peninsula blue
economic zone 6,000,000 1,000,000 5,000,000 Related to assets
construction project
Technical
transformation project
of information-based 2,900,000 290,000 2,610,000 Related to assets
system construction
engineering
Cross-border Related to
880,256 67,114 813,142 income
e-commerce project
Fund for water
Related to
pollution treatment 206,530 56,801 149,729
income
project
Infrastructure
1,718,750 62,500 1,656,250 Related to assets
construction project
Supporting fund for
industrial development 32,800,000 2,050,000 30,750,000 Related to assets
Subsidy for economic
and energy-saving
1,026,400 64,150 962,250 Related to assets
technical
transformation project
Special fund for
efficient water-saving 1,639,000 81,000 1,558,000 Related to assets
irrigation project
Guiding fund for the
Related to
development of service 2,000,000 4,200,000 4,700,000 1,500,000 income
industry
Related to
Subsidy for boiler 90,000 90,000
income
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Amount
of Amount Amount
Amount
subsidy included in included in
Beginning offset Other Ending Related to
Item of liabilities newly non-operating other
balance the cost changes balance assets/income
increased revenue in income in expenses
in this this period this period
period
renovation and
demolition
Subsidy for
mechanical 265,398 265,398 Related to assets
development
Total 86,227,293 4,465,398 12,096,542 78,596,149
M inus: Those included
15,860,254 1,315,000 14,545,254
in current liabilities
Non-current liabilities 70,367,039 4,465,398 10,781,542 64,050,895
7.29 Other non-current liabilities
Unit: Yuan
Item Ending balance Beginning balance
Employee remunerations p ayable 7,159,222 7,234,853
Total 7,159,222 7,234,853
As at June 30, 2019, the employee remunerations payable referred to the job security deposit
deducted from the year-end bonus of the employees higher than sales manager of the
Company in proportion, which will be paid from 2020 to 2022 as predicted.
7.30 Share capital
Unit: Yuan
Increase or decrease (+,-) in this period
Share
Beginning transferred Ending
balance Newly issued Allocated balance
from Other Subtotal
shares shares
accumulation
fund
Total shares 685,464,000 685,464,000
7.31 Capital reserves
Unit: Yuan
Decrease in this
Item Beginning balance Increase in this period Ending balance
period
Capital premium (Share
560,038,853 560,038,853
capital premium)
Other capital reserves 5,916,588 5,916,588
Total 565,955,441 565,955,441
7.32 Other comprehensive income
Unit: Yuan
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Amount incurred in this period
M inus: amount
Amount included in
Beginning incurred other M inus: Attributable Attributable Ending
Item before comprehensive income to parent to minority
balance balance
income tax income before tax company shareholders
in this and transferred expenses after tax after tax
period to profit or loss
in this period
1. Other comprehensive income
not to be reclassified into profit
and loss later
Including: change in net liabilities
and net assets from recalculated
defined benefit plan
Share enjoyed in other
comprehensive income not to be
reclassified into profit and loss in
invested unit under equity law
2. Other comprehensive income to
be reclassified into profit and loss 2,965,377 -4,657,291 -3,060,721 -1,596,570 -95,344
later
Including: share enjoyed in other
comprehensive income to be
reclassified into profit and loss in
invested unit under equity law
Profit and loss from
changes in fair value of financial
assets for sale
Profit and loss from
reclassification of held-to-maturity
investment into fair value of
financial assets for sale
Effective part of profit and
loss of cash-flow hedge
Difference in translation of
Foreign Currency Financial 2,965,377 -4,657,291 -3,060,721 -1,596,570 -95,344
Statement
Total other comprehensive income 2,965,377 -4,657,291 -3,060,721 -1,596,570 -95,344
7.33 Surplus reserves
Unit: Yuan
Decrease in this
Item Beginning balance Increase in this period Ending balance
period
Legal surplus reserves 342,732,000 342,732,000
Free surplus reserves
Reserve fund
Enterprise expansion fund
Other
Total 342,732,000 342,732,000
7.34 Undistributed profit
Unit: Yuan
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Item Ending balance Beginning balance
Undistributed profit at the end of prior period before adjustment 8,008,982,547 7,309,081,618
Total Undistributed profit at the beginning of the period before adjustment
-3,278,942
(increase listed with+ , and decrease listed with -)
Undistributed profit at the beginning of the period after adjustment 8,005,703,605 7,309,081,618
Plus: Net profit for owner of the parent company 603,403,789 1,042,632,929
M inus: Drawn legal surplus
Drawn free surplus
Drawn common risk provision
Common dividend payable 411,278,400 342,732,000
Common dividend transferred to share capital
Undistributed profit at the end of period 8,197,828,994 8,008,982,547
7.35 Ope rating income and operating cost
Unit: Yuan
Amount incurred in this period Amount incurred in prior period
Item
Income Cost Income Cost
M ain business 2,541,459,605 927,958,197 2,818,814,912 969,407,949
Other business 16,815,180 8,294,028 9,415,152 5,149,343
Total 2,558,274,785 936,252,225 2,828,230,064 974,557,292
7.36 Taxes and surcharges
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Consumption tax 68,699,658 97,343,463
Urban maintenance and construction tax 18,763,626 23,778,056
Education surcharges 13,670,717 17,417,976
Building tax 14,184,915 16,878,556
Land use tax 5,478,045 6,013,248
Stamp duty 1,504,356 2,247,814
Other 1,249,531 1,597,138
Total 123,550,848 165,276,251
7.37 Selling expenses
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
M arketing expenses 268,185,487 326,942,076
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Employee remunerations 130,725,779 139,247,494
Transportation expenses 53,735,626 67,177,736
Trademark use fees 43,363,867
Storage and lease expenses 24,274,917 19,857,616
Depreciation expenses 20,476,637 21,735,895
Advertisement expenses 26,920,257 23,574,432
Conference expenses 8,945,999 9,319,883
Design & production expenses 2,365,761 2,457,300
Service charges 11,484,614 12,459,237
Travel expenses 11,822,548 10,886,711
Water, electricity and gas charges 7,697,325 7,166,936
Office & postage costs 2,801,706 2,349,806
Packing expenses 3,971,486 3,873,287
Public security & clean-keeping
2,214,479 2,336,546
expenses
Business entertainment exp enses 1,763,307 1,995,516
Other 14,584,873 15,914,695
Total 591,970,801 710,659,033
7.38 Management expenses
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Employee remunerations 62,572,295 60,660,238
Depreciation expenses 31,887,697 35,410,914
Contracting expenses 7,178,106 7,178,106
Repair expenses 8,253,897 7,076,148
Office expenses 10,177,651 10,977,189
Amortization expenses 7,677,849 9,520,182
Afforestation fees 7,682,946 6,493,556
Safe production costs 2,357,016 2,422,526
Rental expenses 4,766,202 5,061,778
Business entertainment expenses 2,631,383 2,815,060
Public security & clean-keeping
3,356,435 3,953,646
expenses
Travel expenses 2,971,468 2,139,939
Other 4,039,367 4,255,600
Total 155,552,312 157,964,882
7.39 R&D expenses
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
R&D expenses 2,706,811 2,127,006
Total 2,706,811 2,127,006
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
7.40 Financial expenses
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Interest expenditure 9,812,560 18,739,528
M inus: Interest income 4,606,417 7,245,870
Plus: Commission charges 1,271,831 3,005,483
Exchange gain or loss 2,311,609 -1,413,199
Total 8,789,583 13,085,942
7.41 Other income
Unit: Yuan
Amount incurred in prior
Source of other income Amount incurred in this period period
Supporting fund for industrial development 2,050,000 2,050,000
Industrial revitalization and technical transformation
1,086,000
project in Ningxia
Reward for investment in fixed assets 1,140,000 1,140,000
Special fund for construction of peninsula blue economic
1,000,000 1,000,000
zone
Other 3,082,627 4,012,100
Special fund for supporting corporate development 51,633,350 15,011,673
Other 5,305,915 13,683,105
Total 64,211,892 37,982,878
7.42 Loss on impairme nt of cre dit
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Loss on bad debts of accounts receivable -765,935
Total -765,935
7.43 Loss on impairme nt of assets
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
1. Loss on bad debts
2. Inventory falling price loss 6,148,729 4,730,948
3. Loss on impairment of available-for-sale
financial assets
4. Loss on impairment of held-to maturity
investment
5. Loss on impairment of long-term equity
investment
6. Loss on impairment of investment real estate
7. Loss on impairment of fixed assets
8. Loss on impairment of engineering materials
9. Loss on impairment of construction in progress
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Item Amount incurred in this period Amount incurred in prior period
10. Loss on impairment of productive biological
assets
11. Loss on impairment of oil and gas assets
12. Loss on impairment of intangible assets
13. Loss on impairment of goodwill
14. Other
Total 6,148,729 4,730,948
7.44 Income from asset disposal
Unit: Yuan
Source of income from asset disposal Amount incurred in this period Amount incurred in prior period
Income from disposal of fixed assets 1,138 93,958
Total 1,138 93,958
7.45 Non-operating income
Unit: Yuan
Amount incurred in Amount incurred in Amount included in the current
Item
this period prior period non-recurring profits/losses
Gains on debt recombination
Gains on exchange of non-monetary
assets
Grains on donations
Governmental subsidy
Other 3,575,914 2,006,392 3,575,914
Total 3,575,914 2,006,392 3,575,914
7.46 Non-operating expenses
Unit: Yuan
Amount incurred in Amount incurred in Amount included in the current
Item non-recurring profits/losses
this period prior period
Loss on debt recombination
Loss on exchange of
non-monetary assets
Donation
Fine, penalty and overdue fine
paid due to violation of laws and 10,811 1,187,713 10,811
administrative regulations
Other 153,239 204,649 153,239
Total 164,050 1,392,362 164,050
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
7.47 Income tax expenses
7.47.1 List of income tax expenses
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior
period
Current income tax expenses 161,779,976 178,993,081
Deferred income tax expenses 48,501,602 32,986,654
Total 210,281,578 211,979,735
7.47.2 Adjustme nt process of accounting profit and income tax expenses
Unit: Yuan
Item Amount incurred in this period
Total profit 812,459,893
Income tax expenses calculated according to the legal/applicable tax rate 203,114,973
Influence of different tax rates applicable to subsidiary -66,516
Influence of income tax in the term before adjustment 3,082,397
Influence of nontaxable income
Influence of non-deductible costs, expenses and losses 2,219,026
Influence of deductible loss from use of unconfirmed deferred income tax assets in prior
period
Influence of deductible temporary difference or deductible loss of unconfirmed deferred
income tax assets in this period 1,931,698
Income tax expense 210,281,578
7.48 Other comprehensive income
Refer to Note 7.32 for details.
7.49 Items of cash flow state ment
7.49.1 Other cash received related to operating activities
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Governmental subsidy income 62,580,748 33,687,978
Interest income 2,835,438 3,302,294
Net amercement income 1,225,511 1,609,829
Other 1,143,923 3,742,920
Total 67,785,620 42,343,021
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
7.49.2 Other cash paid related to operating activities
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Selling expenses 348,849,996 387,846,396
Administrative expenses 41,017,612 45,235,101
Other 2,912,859 3,895,589
Total 392,780,467 436,977,086
7.49.3 Other cash received related to financial activities
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Government subsidies received related to
3,150,000
assets
Interest income from pledge of fixed
371,431
deposits by the R&D Company
Long-term loans from pledge of fixed
20,000,000
deposits by R&D Company
Total 23,521,431
7.49.4 Other cash paid related to financial activities
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
R&D Company’ long-term loans pledged by
20,000,000
fixed-term deposits
Total 20,000,000
7.50 Supple mentary information to cash flow statement
7.50.1 Supple mentary information to cash flow statement
Unit: Yuan
Supplementary materials Amount incurred in this period Amount incurred in prior period
1. Cash flows from operating activities calculated by
-- --
adjusting the net profit:
Net profit 602,178,315 636,001,737
Plus: Provision for impairment of assets -5,382,794 -4,730,948
Depreciation of fixed assets, oil-and-gas assets and
155,147,729 148,983,240
productive biological assets
Depreciation of right-of-use assets
Amortization of intangible assets 8,438,742 11,567,301
Amortization of long-term deferred expenses 6,662,662 8,117,444
Losses on disposal of fixed assets, intangible assets and
-1,138 -93,958
other long-term assets (profit listed with “－”)
Losses on retirement of fixed assets (profit listed with
“－”)
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Supplementary materials Amount incurred in this period Amount incurred in prior period
Losses on fair value change (profit listed with “－”)
Financial costs (profit listed with “－”) 13,987,879 15,048,678
Investment losses (profit listed with “－”)
Decrease in deferred income tax assets (increase listed
50,789,656 37,133,223
with “-”)
Increase of deferred income tax liabilities (decrease
-3,381,035 -4,146,569
listed with “－”)
Decrease in inventories (increase listed with “-”) 123,958,750 216,486,236
Decrease in operating receivables (increase listed with
-305,623,146
“-”) -172,662,167
Increase in operating payable (decrease listed with “-”) -280,260,593 -205,989,766
Other
Net cash flows from operating activities 499,476,006 552,753,472
2. Significant investment and financing activities not
-- --
involving cash deposit and withdrawal:
Debt transferred into assets
Convertible corporate bond due within 1 year
Fixed assets under financing lease
3. Net changes of cash and cash equivalent: -- --
Ending balance of cash 1,573,727,077 1,428,670,462
M inus: Beginning balance of cash 1,206,860,334 1,180,889,274
Plus: Ending balance of cash equivalent
M inus: Beginning balance of cash equivalent
Net increase amount of cash and cash equivalent 366,866,743 247,781,188
7.50.2 Composition of cash and cash equivalents
Unit: Yuan
Item Ending balance Beginning balance
1. Cash 1,573,727,077 1,428,670,462
Including: Cash on hand 70,198 151,228
Bank deposits on demand 1,573,656,879 1,428,519,234
Other monetary capital on demand
Due from central bank available for payment
Due from the industry
Inter-bank lending
2. Cash equivalents
Including: Bond investment due within three months
3. Balance of cash and cash equivalents at the end of
1,573,727,077 1,428,670,462
period
Including: Restricted use of parent company or
subsidiaries in the group
7.51 Assets with owne rship or use right restrictions
Unit: Yuan
Item Ending book value Reason for restriction
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Loan deposit, L/C deposit, frozen balance of Alipay,
M onetary capital 94,466,626 housing fund and guaranty money for deposit in unit
card
Accounts receivable 31,134,017 Pledge of short-term loans
Pledge of short-term loans, long-term loans and
Fixed assets 353,013,613 long-term accounts payable
Intangible assets 215,282,924 Pledge of long-term accounts payable
Total 693,897,180 --
7.52 Foreign curre ncy monetary ite ms
7.52.1 Foreign curre ncy monetary ite ms
The foreign currency monetary items of the Group in domestic entities of China are listed as
follows:
Unit: Yuan
Item Ending foreign currency balance Translation exchange rate Ending converted RM B balance
M onetary capital -- -- 46,815,034
Including: U SD 6,805,498 6.8747 46,785,757
EUR 2,901 7.817 22,677
HKD 7,503 0.8797 6,600
7.52.2 Overseas operational entities
The currency adopted by the overseas subsidiaries of the Company according to the main
economic environment where the operation is located shall be chosen as the recording
currency. Marques del Atrio and Francs Champs Participations SAS (“Francs Champs”) both
use euro as the recording currency, Indomita Wine Company Chile, SpA uses Chilean peso as
the recording currency, and Kilikanoon Estate, Australia uses Australian dollar as the
recording currency. The foreign currency assets or liabilities of overseas subsidiaries are listed
as follows:
Unit: Yuan
Item Ending foreign currency balance Translation exchange rate Ending converted RM B balance
M onetary capital -- -- 3,553,711
Including: U SD 516,926 6.8747 3,553,711
EUR
HKD
Short-term loans -- -- 75,621,700
Including: U SD 11,000,000 6.8747 75,621,700
EUR
HKD
8. Changes in scope of consolidation
Nil
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
9. Equity in other entities
9.1 Equity in the subsidiaries
9.1.1 Constitution of enterprise group
Proportion of
Business shareholding
Name of subsidiary Principal business location Registration place Acquisition mode
nature
Direct Indirect
Shihezi City, Xinjiang Acquired from a business
Xinjiang Tianzhu (a) Shihezi City, Xinjiang Uygur Manufacturing 60%
Uygur Autonomous Region, combination under
Autonomous Region, China industry
China non-common control
Acquired from a business
Roullet Fransac Cognac, France Cognac, France Trading 100% combination under
non-common control
Acquired from a business
Mirefleurs Bordeaux, France Bordeaux, France Trading 100% combination under
non-common control
Acquired from a business
Marques del Atrio Navarra, Spain Navarra, Spain Sales 75% combination under
non-common control
Acquired by
Indomita Wine Santiago, Chile Santiago, Chile Sales 85% establishment or
investment
Acquired from a business
Kilikanoon Estate, Australia Adelaide, Australia Adelaide, Australia Sales 80% combination under
non-common control
Beijing Changyu Wine Acquired by
Marketing Co., Ltd. Beijing City, China Beijing City, China Sales 50% 50% establishment or
(“Beijing Marketing”) investment
Yantai Kylin Packaging Acquired by
Yantai City, Shandong Yantai City, Shandong Manufacturing
Co., Ltd. (“ Kylin 100% establishment or
Province, China Province, China industry
Packaging”) investment
Yantai Chateau Acquired by
Yantai City, Shandong Yantai City, Shandong Manufacturing
Changyu-Castel Co., Ltd. 70% establishment or
Province, China Province, China industry
(“Chateau Changyu”) (b) investment
Changyu (Jingyang) Acquired by
Xianyang City, Shaanxi Xianyang City, Shaanxi Manufacturing
Pioneer Wine Co., Ltd. 100% establishment or
Province, China Province, China industry
(“ Jingyang Wine”) investment
Yantai Changyu Pioneer Acquired by
Yantai City, Shandong Yantai City, Shandong
Wine Sales Co., Ltd. Sales 100% establishment or
Province, China Province, China
(“Sales Company”) investment
Langfang Development
Acquired by
Zone Castel-Changyu Wine Langfang City, Hebei Langfang City, Hebei Province, Manufacturing 39% 10% establishment or
Co., Ltd. (“ Langfang Province, China China industry
investment
Castel”) (c)
Changyu (Jingyang) Acquired by
Xianyang City, Shaanxi Xianyang City, Shaanxi
Pioneer Wine Sales Co., Sales 100% establishment or
Province, China Province, China
Ltd. (“ Jingyang Sales”) investment
Langfang Changyu Pioneer Langfang City, Hebei Acquired by
Langfang City, Hebei Province,
Wine Sales Co., Ltd. Sales 100% establishment or
Province, China China
(“ Langfang Sales”) investment
Shanghai Changyu Wine Acquired by
Marketing Co., Ltd. Shanghai City, China Shanghai City, China Sales 30% 70% establishment or
(“Shanghai Marketing”) investment
Beijing Changyu AFIP
Eco-agriculture Acquired by
Miyun County, Beijing City, Miyun County, Beijing City,
Development Co., Ltd. Sales 100% establishment or
China China
(“ Eco-agriculture investment
Development”)
Beijing Changyu AFIP Acquired by
Manufacturing
Wine Chateau Co., Ltd. Beijing City, China Beijing City, China 90% establishment or
industry
(“Beijing Chateau”) (d) investment
Acquired by
Yantai Changyu Wine Sales Yantai City, Shandong Yantai City, Shandong Sales 90% 10% establishment or
Co., Ltd. ( “Wine Sales”) Province, China Province, China investment
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Proportion of
Name of subsidiary Principal business location Registration place Business shareholding Acquisition mode
nature
Direct Indirect
Yantai Changyu Pioneer Acquired by
International Wine Co., Ltd. Yantai City, Shandong Yantai City, Shandong Sales 70% 30% establishment or
Province, China Province, China
(“Pioneer International”) investment
Hangzhou Changyu Wine Hangzhou City, Zhejiang Acquired by
Hangzhou City, Zhejiang
Sales Co., Ltd. (“ Hangzhou Sales 100% establishment or
Changyu”) Province, China Province, China investment
Acquired by
Yinchuan City, Ningxia Hui Yinchuan City, Ningxia Hui Planting
Ningxia Growing 100% establishment or
Autonomous Region, China Autonomous Region, China industry
investment
Huanren Changyu National Benxi City, Liaoning Benxi City, Liaoning Province, Acquired by
Wine Sales Co., Ltd. Sales 100% establishment or
Province, China China
(“ National Wine”) investment
Liaoning Changyu Icewine Acquired by
Benxi City, Liaoning Benxi City, Liaoning Province, Manufacturing
Valley Co., Ltd. (“ Icewine 51% establishment or
Province, China China industry
Valley”) (e) investment
Yantai Development Zone
Acquired by
Changyu Trading Co., Ltd. Yantai City, Shandong Yantai City, Shandong Sales 100% establishment or
(“ Development Zone Province, China Province, China
investment
Trading”)
Shenzhen Changyu Wine Acquired by
Shenzhen City, Guangdong Shenzhen City, Guangdong
Marketing Co., Ltd. Sales 100% establishment or
Province, China Province, China
(“Shenzhen Marketing”) investment
Yantai Fushan District Acquired by
Changyu Trading Co., Ltd. Yantai City, Shandong Yantai City, Shandong Sales 100% establishment or
Province, China Province, China
(“Fushan Trading”) investment
Beijing Changyu AFIP
Acquired by
International Conference Miyun County, Beijing City, Miyun County, Beijing City, Service 100% establishment or
Center Co., Ltd. China China industry
investment
(“Conference Center”)
Beijing Changyu AFIP Acquired by
Miyun County, Beijing City, Miyun County, Beijing City, Tourist
Tourism and Culture Co., 100% establishment or
China China industry
Ltd. (“ AFIP Tourism”) investment
Acquired by
Yinchuan City, Ningxia Hui Yinchuan City, Ningxia Hui Manufacturing
Ningxia Wine 100% establishment or
Autonomous Region, China Autonomous Region, China industry
investment
Yantai Changyu Chateau Acquired by
Yantai City, Shandong Yantai City, Shandong Wholesale and
Tinlot Co., Ltd. (“Chateau 65% 35% establishment or
Province, China Province, China retail
Tinlot”) investment
Changyu (Qingtongxia) Qingtongxia City, Ningxia Acquired by
Qingtongxia City, Ningxia Hui Sales
Wine Sales Co., Ltd. Hui Autonomous Region, 100% establishment or
Autonomous Region, China
(“ Qingtongxia Sales”) China investment
Shihezi City, Xinjiang Acquired by
Shihezi City, Xinjiang Uygur Manufacturing
Shihezi Chateau Uygur Autonomous Region, 100% establishment or
Autonomous Region, China industry
China investment
Acquired by
Yinchuan City, Ningxia Hui Yinchuan City, Ningxia Hui Manufacturing
Ningxia Chateau 100% establishment or
Autonomous Region, China Autonomous Region, China industry
investment
Chateau Changyu Rena Acquired by
Xianyang City, Shaanxi Xianyang City, Shaanxi Manufacturing
Shaanxi Co., Ltd. 100% establishment or
Province, China Province, China industry
(“Chang’an Chateau”) investment
Acquired by
Research, Development & Yantai City, Shandong Yantai City, Shandong Manufacturing 68% establishment or
Manufacture Company (f) Province, China Province, China industry
investment
Changyu (Huanren) Pioneer Wine-making Acquired by
Benxi City, Liaoning Benxi City, Liaoning Province,
Wine Co., Ltd. (“ Huanren project 100% establishment or
Wine”) Province, China China preparation investment
Xinjiang Changyu Wine Acquired by
Xinjiang Uygur Xinjiang Uygur Autonomous
Sales Co., Ltd. (“ Xinjiang Sales 100% establishment or
Autonomous Region, China Region, China
Sales”) investment
Ningxia Changyu Trading Acquired by
Yinchuan City, Ningxia Hui Yinchuan City, Ningxia Hui
Co., Ltd. (“ Ningxia Sales 100% establishment or
Autonomous Region, China Autonomous Region, China
Trading”) investment
Shaanxi Changyu Rena Acquired by
Xianyang City, Shaanxi Xianyang City, Shaanxi
Wine Sales Co., Ltd. Sales 100% establishment or
Province, China Province, China
(“Shaanxi Sales”) investment
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Proportion of
Name of subsidiary Principal business location Registration place Business shareholding Acquisition mode
nature
Direct Indirect
Penglai Changyu Wine Acquired by
Penglai City, Shandong Penglai City, Shandong
Sales Co., Ltd. (“Penglai Sales 100% establishment or
Province, China Province, China
Wine”) investment
Laizhou Changyu Wine Acquired by
Laizhou City, Shandong Laizhou City, Shandong
Sales Co., Ltd. (“ Laizhou Sales 100% establishment or
Sales”) Province, China Province, China investment
Acquired by
Francs Champs Investment
Cognac, France Cognac, France 100% establishment or
Participations SAS trade
investment
Lanzhou Changyu Wine Lanzhou City, Gansu Lanzhou City, Gansu Province, Acquired by
Marketing Co., Ltd. Sales 100% establishment or
Province, China China
(“ Lanzhou Marketing”) investment
Beijing Changyu Trading Acquired by
Co., Ltd. (“ Beijing Beijing City, China Beijing City, China Sales 100% establishment or
Trading”) investment
Tianjin Changyu Pioneer Acquired by
Wine Sales Co., Ltd. Tianjin City, China Tianjin City, China Sales 100% establishment or
(“Tianjin Pioneer”) investment
Fuzhou Changyu Pioneer Acquired by
Fuzhou City, Fujian Fuzhou City, Fujian Province,
Wine Co., Ltd. (“Fuzhou Sales 100% establishment or
Province, China China
Pioneer”) investment
Nanjing Changyu Pioneer Acquired by
Nanjing City, Jiangsu Nanjing City, Jiangsu Province, Sales
Wine Co., Ltd. (“ Nanjing 100% establishment or
Province, China China
Pioneer”) investment
Xianyang Changyu Pioneer Acquired by
Xianyang City, Shaanxi Xianyang City, Shaanxi
Wine Sales Co., Ltd. Sales 100% establishment or
Province, China Province, China
(“ Xianyang Pioneer”) investment
Shenyang Changyu Pioneer Shenyang City, Liaoning Shenyang City, Liaoning Acquired by
Wine Co., Ltd. (“Shenyang Sales 100% establishment or
Province, China Province, China
Pioneer”) investment
Jinan Changyu Pioneer Acquired by
Jinan City, Shandong Jinan City, Shandong Province, Sales
Wine Co., Ltd. (“ Jinan 100% establishment or
Province, China China
Pioneer”) investment
Shanghai Changyu Pioneer Acquired by
Wine Co., Ltd. (“Shanghai Shanghai City, China Shanghai City, China Sales 100% establishment or
Pioneer”) investment
Fuzhou Changyu Pioneer Acquired by
Fuzhou City, Jiangxi Fuzhou City, Jiangxi Province, Sales
Wine Co., Ltd. (“Fuzhou 100% establishment or
Province, China China
Pioneer”) investment
Shijiazhuang Changyu
Acquired by
Pioneer Wine Sales Co., Shijiazhuang City, Hebei Shijiazhuang City, Hebei Sales 100% establishment or
Ltd. (“Shijiazhuang Province, China Province, China
investment
Pioneer”)
Hangzhou Yuzefeng Acquired by
Hangzhou City, Zhejiang Hangzhou City, Zhejiang
Trading Co., Ltd. Sales 100% establishment or
Province, China Province, China
(“ Hangzhou Yuzefeng”) investment
Acquired by
Jilin Changyu Pioneer Wine Changchun City, Jilin Changchun City, Jilin Sales 100% establishment or
Co., Ltd. (“ Jilin Pioneer”) Province, China Province, China
investment
Beijing Changyu Pioneer Acquired by
Wine Sales Co., Ltd. Beijing City, China Beijing City, China Sales 100% establishment or
(“Beijing Pioneer”) investment
Harbin Changyu Pioneer Acquired by
Harbin City, Heilongjiang Harbin City, Heilongjiang
Wine Sales Co., Ltd. Sales 100% establishment or
Province, China Province, China
(“ Harbin Pioneer”) investment
Hunan Changyu Pioneer Acquired by
Changsha City, Hunan Changsha City, Hunan
Wine Co., Ltd. (“ Hunan Sales 100% establishment or
Province, China Province, China
Pioneer”) investment
Yinchuan Changyu Pioneer Acquired by
Wine Co., Ltd. (“ Yinchuan Yinchuan City, Ningxia Hui Yinchuan City, Ningxia Hui Sales 100% establishment or
Autonomous Region, China Autonomous Region, China
Pioneer”) investment
Kunming Changyu Pioneer Kunming City, Yunnan Acquired by
Kunming City, Yunnan
Wine Co., Ltd. (“ Kunming Sales 100% establishment or
Province, China Province, China
Pioneer”) investment
Chongqing Changyu Chongqing City, China Chongqing City, China Sales 100% Acquired by
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Proportion of
Name of subsidiary Principal business location Registration place Business shareholding Acquisition mode
nature
Direct Indirect
Pioneer Wine Sales Co., establishment or
Ltd. (“Chongqing Pioneer”) investment
Wuhan Changyu Pioneer Acquired by
Wuhan City, Hubei Wuhan City, Hubei Province,
Wine Co., Ltd. (“Wuhan Sales 100% establishment or
Province, China China
Pioneer”) investment
Hohhot Changyu Pioneer Hohhot City, Inner Acquired by
Hohhot City, Inner Mongolia
Wine Co., Ltd. (“ Hohhot Mongolia Autonomous Sales 100% establishment or
Autonomous Region , China
Pioneer”) Region , China investment
Chengdu Changyu Pioneer Acquired by
Chengdu City, Sichuan Chengdu City, Sichuan
Wine Co., Ltd. (“Chengdu Sales 100% establishment or
Province, China Province, China
Pioneer”) investment
Nanning Changyu Pioneer Nanning City, Guangxi Acquired by
Nanning City, Guangxi Zhuang Sales
Wine Co., Ltd. (“ Nanning Zhuang Autonomous 100% establishment or
Autonomous Region, China
Pioneer”) Region, China investment
Lanzhou Changyu Pioneer Acquired by
Lanzhou City, Gansu Lanzhou City, Gansu Province,
Wine Co., Ltd. (“ Lanzhou Sales 100% establishment or
Province, China China
Pioneer”) investment
Yantai Roullet-Fransac
Acquired by
Imported Wine Sales Co., Yantai City, Shandong Yantai City, Shandong
Sales 100% establishment or
Ltd. (“ Yantai Province, China Province, China investment
Roullet-Fransac”)
Hefei Changyu Pioneer Acquired by
Hefei City, Anhui Province, Hefei City, Anhui Province,
Wine Co., Ltd. (“ Hefei Sales 100% establishment or
China China
Pioneer”) investment
Urumchi Changyu Pioneer Urumchi City, Xinjiang Acquired by
Urumchi City, Xinjiang Uygur Sales
Wine Co., Ltd. (“ Urumchi Uygur Autonomous Region, Autonomous Region, China 100% establishment or
Pioneer”) China investment
Guangzhou Changyu Acquired by
Guangzhou City, Guangzhou City, Guangdong Sales 100% establishment or
Pioneer Wine Co., Ltd.
Guangdong Province, China Province, China
(“ Guangzhou Pioneer”) investment
Acquired by
Yantai City, Shandong Yantai City, Shandong
Wine Sales Co., Ltd. Sales 100% establishment or
Province, China Province, China
investment
Explanation for difference between the proportion of shareholding and proportion of voti ng power
in the subsidiaries:
(a) Xinjiang Tianzhu is a subsidiary of the Company obtained by merger and acquisition,
whose 60% of the shares are held by the Company. The Company exercises full control over
the operation, investment and financing policies of Xinjiang Tianzhu by contract arrangement.
This contract arrangement was expired on August 6, 2017. After the expiration, the minority
shareholders of Xinjiang Tianzhu shall enjoy/bear all rights/duties of shareholders specified in
the Articles of Association.
(b) Changyu Chateau is a Sino- foreign joint venture established by the Company and a
foreign investor, whose 70% of the shares are held by the Company. The Company exercises
full control over the operation, investment and financing policies of Cha ngyu Chateau by
contract arrangement. The contract arrangement will expire on December 31, 2022.
(c) Langfang Castel is a Sino- foreign joint venture established by the Company and a foreign
investor, whose 49% of the shares are held by the Company and its subsidiaries. The
Company exercises full control over the operation, investment and financing policies of
Langfang Castel by contract arrangement. The contract arrangement expired on December 31,
2017. After the expiration of the contract arrangement, the minority shareholders of Langfang
Castel normally enjoy/undertake all rights/duties of the shareholders agreed in the Articles of
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Association of the Company.
(d) Beijing Chateau is a limited liability company jointly established by the Company and
Yantai De’an and Beijing Qinglang, in which the Company holds 90% of the shares. The
Company exercises full control over the operation, investment and financing policies of
Beijing Chateau by contract arrangement. The contract arrangement will expire on September
2, 2019.
(e) Icewine Valley is a Sino- foreign joint venture established by the Company and a foreign
investor, whose 51% of the shares are held by the Company. The Company exercises full
control over the operation, investment and financing policies of I cewine Valley by contract
arrangement. The contract arrangement will expire on December 31, 2021.
(f) The Research, Development & Manufacture Company is a joint venture established by the
Company and Agricultural Development Fund, whose 68% of the shares were held by the
Company on June 30, 2019. As stated in Note 7.27, the Company exercises full control over
the operation, investment and financing policies of the Research, Development &
Manufacture Company by contract arrangement. The contract arrangement will expire on
May 22, 2026. Up to June 30, 2019, the remaining investment of the Agricultural
Development Fund accounted for 32% of the registered capital.
9.1.2 Important non-wholly-owned s ubsidiaries
Unit: Yuan
Shareholding proportion Profit/loss attributable Dividend declared to be Balance of minority
distributed to minority
Name of subsidiary of minority to minority shareholders shareholder’s interest at
shareholders in this
shareholders in this period the end of period
period
Xinjiang Tianzhu 40% -1,200,628 49,412,020
M arques del Atrio 25% 464,844 1,367,975 29,878,944
Changyu Chateau 30% 12,365,016
Langfang Castel 51% -752,237 20,175,744
Beijing Chateau 10% 65,133,868
Icewine Valley 49% 33,319,062
Indomita Wine 15% 564,376 53,709,304
Kilikanoon Estate, 20% -301,829 16,204,035
Australia
Explanation for difference between the proportion of shareholding and proportion of voting
power of the minority shareholders in the subsidiaries: See details in Note 9.1.1.
9.1.3 Main financial information of important non-wholly-owne d subsidiaries
Unit: Yuan
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Ending balance Beginning balance
Name of
subsidiary Current Non-current Current Non-current Total Current Non-current Total Current Non-current Total
Total assets
assets assets liabilities liabilities liabilities assets assets assets liabilities liabilities liabilities
Xinjiang 26,891,774 64,187,998 91,079,771 -169,932 5,336,114 5,166,181 27,390,495 66,486,795 93,877,290 5,336,114 5,336,114
Tianzhu
Changyu 126,947,614 113,877,340 240,824,954 163,176,906 163,176,906 141,298,023 114,694,168 255,992,191 171,869,662 171,869,662
Chateau
Langfang 16,966,616 15,672,549 32,639,165 4,033,546 4,033,546 17,659,511 16,001,682 33,661,193 3,358,322 3,358,322
Castel
Beijing
228,256,490 458,433,952 686,690,442 45,912,267 45,912,267 219,973,582 461,115,089 681,088,671 62,598,545 62,598,545
Chateau
Icewine 61,748,346 23,105,860 84,854,207 31,627,378 100,000 31,727,378 45,194,591 23,920,890 69,115,481 14,974,458 100,000 15,074,458
Valley
Marques 407,617,465 92,937,395 500,554,860 304,115,810 72,890,389 377,006,198 464,421,130 99,080,668 563,501,798 381,659,315 54,520,937 436,180,252
del Atrio
Indomita
210,503,095 295,300,215 505,803,310 138,985,158 4,861,038 143,846,196 214,784,490 300,969,342 515,753,832 148,359,328 4,976,161 153,335,489
Wine
Kilikanoon
Estate, 82,656,715 64,415,130 147,071,845 12,813,137 52,227,853 65,040,990 87,634,707 63,759,866 151,394,573 13,387,942 51,893,171 65,281,113
Australia
Unit: Yuan
Amount incurred in this period Amount incurred in prior period
Name of Total Total
subsidiary Operating Operating Operating Operating
Net profit comprehensive Net profit comprehensive
income cash flow income cash flow
income income
Xinjiang
-3,001,571 -1,297,212 -417,462 18,803 -184,572 -184,572 10,284,801
Tianzhu
Changyu
24,470,842 -2,189,871 -686,874 6,946,282 43,226,910 2,861,474 2,861,474 2,419,427
Chateau
Langfang
-1,474,975 -821,013 25,801 5,038,281 -1,952,954 -1,952,954 -4,435,022
Castel
Beijing
12,711,985 22,752,823 9,667,568 78,502,666 15,243,700 15,243,700 12,282,145
Chateau 90,339,526.00
Icewine
-1,986,710 -754,056 1,903,734 27,305,133 905,396 905,396 2,018,740
Valley 19,763,387.00
M arques
129,064,457 1,859,381 -4,084,674 -23,846,960 148,197,893 1,214,012 -929,332 -21,783,821
del Atrio
Indomita
86,818,838 3,762,504 1,880,687 -1,725,571 93,719,341 -281,859 -4,460,814 -7,723,684
Wine
Kilikanoon
Estate, 22,852,809 -1,509,147 -4,011,458 1,024,962 25,904,401 -115,317 -3,779,883 -1,469,903
Australia
10. Risks related to financial instruments
The main financial instruments of the Group include monetary capital, bills receivable, accounts
receivable, receivables financing, other receivables, other non-current financial assets, short-term
loans, non-current liabilities due within one year, accounts payable, other payables, long-term
accounts payable and long-term loans, etc. Please refer to Note 7 for details of each financial
instruments. The risks related to these financial instruments and risk management policies adopted by
the Group to reduce these risks are shown as follows. The management of the Group manages and
monitors these risk exposures to ensure that the above-mentioned risks are controlled within a defined
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
scope.
The Group adopts sensitivity analysis techniques to analyze the possible influence of possible
reasonable changes of risk variables on the current profits and losses and shareholders’ equity. Since
any risk variable merely changes independently and the final influence of relevance between variables
on the change of certain risk variable will exert a great effect, the following content is carried out
under the hypothesis that each variable changes independently.
The risk management objective of the Group is to achieve proper balance between risks and benefits,
to minimize the negative influence of the risks on the business performance of the Group and to
maximize the shareholders’ benefit. Based on this risk management objective, the basic risk
management strategy of the Group is to determine and analyze various risks faced by the Group, to set
up proper risk tolerance bottom line and to carry out risk management, and to supervise various risks
timely and reliably to control the risks within a defined scope.
10.1 Risk manage ment objective and policy
10.1.1 Market risk
① Foreign exchange risk
Foreign exchange risk refers to the risk that causes loss due to exchange rate fluctuation. The foreign
exchange risk borne by the Group is mainly relevant to EUR and USD. Except that the overseas
subsidiaries of the Group purchase and sell in EUR, Chilean peso and AUD, which borrow in USD,
and domestic subsidiaries deposit in EUR and USD, other main business activities of the Group are
priced and settled in RMB. As at June 30, 2019, except that the assets and liabilities mentioned in the
table below were the balance of deposits or loans shown in foreign currencies, other assets and
liabilities of the entities of the Group were settled in their respective functional currencies.
Unit: Yuan
Item Ending balance Beginning balance
M onetary capital (EUR) 22,677 199,753
M onetary capital (USD) 50,339,468 51,283,910
Short-term loans (USD) 75,621,700 75,495,200
The foreign exchange risk caused by the assets and liabilities of such foreign currency balance may
exert an influence on the business performance of the Group. The Group pays close attention to the
influence of exchange rate fluctuation on the foreign exchange risk of the Group. The Group has not
taken any measures to avoid the foreign exchange risk at present.
Sensitivity analysis of foreign exchange risk
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
With the other variables unchanged, the pre-tax influence of possible reasonable exchange rate
fluctuation on current profit and loss and shareholders’ equity is shown as follows:
Domestic entities:
Unit: Yuan
This period
Item Exchange rate fluctuation
Influence on profit in this period Influence on shareholders’ equity
EUR 5% appreciation against RM B 1,134 1,134
EUR 5% depreciation against RM B -1,134 -1,134
USD 5% appreciation against RM B 2,339,288 2,339,288
USD 5% depreciation against RM B -2,339,288 -2,339,288
Overseas entities:
Unit: Yuan
This period
Item Exchange rate fluctuation
Influence on profit in this period Influence on shareholders’ equity
USD 5% appreciation against EUR 10,250 10,250
USD 5% depreciation against EUR -10,250 -10,250
USD 10% appreciation against CLP -115,086 -115,086
USD 10% depreciation against CLP 115,086 115,086
Note: As at June 30, 2019, the management of the Group predicted that EUR and USD exchange rate
against RMB, and USD exchange rate against EUR changed by 5%; and USD exchange rate against
CLP changed by 15%.
② Interest rate risk – risk of change in cash flow
The risk of change in cash flow of financial instruments caused by interest rate change of the Group is
mainly relevant to the monetary capital and bank loan at floating interest rate. The policy of the Group
is to maintain the floating interest rate of these loans to eliminate the risk of change in fair value of the
interest rate.
Sensitivity analysis of interest rate risk
Sensitivity analysis of interest rate risk is based on the hypothesis that the change in market interest
rate influences the interest income or expense of financial instruments at variable rate.
The management of the Group thinks that the interest rate risk of deposit in bank borne by the Group
is not significant, and therefore the sensitivity analysis of interest rate of deposit in bank is not
disclosed here.
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
On the basis of the above-mentioned hypothesis, with the other variables unchanged, the pre-tax
influence of possible reasonable exchange rate fluctuation on current profit and loss and shareholders’
equity is as follows:
Unit: Yuan
This period
Item Interest rate change
Influence on profit of this period Influence on shareholders’ equity
Bank loan Increase by 50 BP -323,958 -323,958
Bank loan Decrease by 50 BP 323,958 323,958
Note: As at June 30, 2019, the management of the Group predicted that the bank floating rate changed
by 50 basis points
10.1.2 Credit risk
As at June 30, 2019, the largest credit risk exposure possibly causing the financial loss of the
Group was mainly caused by the loss generated by the financial assets of the Group due to
failure of another party of the contract in fulfilling obligations.
To lower the credit risk, the Group only trades with the recognized and reputable third party.
In accordance with the policy of the Group, credit check shall be carried out for all customers
who transact by means of credit. In addition, the Group conducts continuous monitoring on
the balance of accounts receivable to ensure that the Group will not face major risk of bad
debts. For transactions not settled with recording currency of relevant business units, unless
the credit control department of the Group specially approves, the Group will not provide
credit trade terms. In addition, the Group audits the collection of each single significant
account receivable on each date of balance sheet to ensure that sufficient bad-debt provision is
accrued for accounts unable to be collected. Therefore, the management of the Group thinks
the credit risk borne by the Group is greatly reduced.
Since the Group only trades with the recognized and reputable third party, no collateral is
required. The credit risk is managed centrally according to the customer/counter-party,
geographic area and industry. As at June 30, 2019, 18.3% of accounts receivable of the Group
came from top five borrowers in accounts receivable of the Group (December 31, 2018:
19.8%). The Group holds no collateral or other credit enhancement for the balance of
accounts receivable.
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
10.1.3 Liquidity risk
When managing the liquidity risk, the Group reserves and monitors the cash and cash
equivalents the management considers sufficient to satisfy the operation need of the Group
and reduce the influence of fluctuation in cash flow. The management of the Group monitors
the use of bank loans and ensures to abide by the loan agreement.
11. Related parties and related transactions
11.1 Particulars of the parent company of the Company
Proportion of Proportion of
Name of parent shareholding of the voting powers of
Registration place Business nature Registered capital
company parent company in the parent company
the Company in the Company
Changyu Group M anufacturing
Yantai City 50,000,000 50.40% 50.40%
Company industry
From January to June 2019, there was no fluctuation in the registered capital of the parent
company and its share in equity interest and voting right.
11.2 Particulars of the subsidiaries of the Company
See particulars of the subsidiaries of the Company in Note 9.
11.3 Particulars of other related parties
Name of other related parties Relationship between other related parties and the Company
Yantai Changyu Wine Culture M useum Co., Ltd. (“Wine
A company controlled by the same parent company
Culture M useum”)
Yantai Changyu Window of International Wine City Co. Ltd.
A company controlled by the same parent company
(“Window of Wine City”)
Yantai God Horse Packing Co., Ltd. (“God Horse Packing”) A company controlled by the same parent company
Yantai Zhongya M edical Health Wine Co., Ltd. (“Zhongya
A company controlled by the same parent company
M edical”)
Yantai Changyu Cultural Tourism Product Sales Co., Ltd.
A company controlled by the same parent company
(“Cultural Sales”)
Yantai Changyu Cultural Tourism Development Co., Ltd.
A company controlled by the same parent company
(“Cultural Development”)
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
11.4 Related transactions
11.4.1 Related transactions of purchasing and selling goods and providing and receiving
services
List of purchasing goods/receiving services
Unit: Yuan
Approved transaction Exceeding the
Related Amount incurred Amount incurred in
Related parties amount transaction amount or
transactions in this period prior period
not
Purchasing
God Horse Packing 74,970,845 95,990,354
goods
Purchasing
Zhongya M edical 2,970,007 6,037,893
goods
Wine Culture Purchasing
7,324,199 9,475,159
M useum goods
Window of Wine Purchasing
6,853,112 2,857,130
City goods
Purchasing
Cultural Sales 65,907
goods
Cultural Purchasing
40,458
Development goods
List of selling goods/providing services
Unit: Yuan
Amount incurred in this
Related parties Related transactions Amount incurred in prior period
period
Wine Culture M useum Selling goods 3,377,011 13,889,017
Window of Wine City Selling goods 3,891,101 8,773,612
Zhongya M edical Selling goods 2,559,870 2,203,629
God Horse Packing Selling goods 3,520 15,742
Cultural Sales Selling goods 3,873,204
Cultural Development Selling goods 1,847,727 220,759
The price of transactions between the Group and the related parties are based on the
negotiated price.
11.4.2 Related trusteeship/contracting and mandatory administration/outsourcing
Nil
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
11.4.3 Leasing with related parties
The Company as a lessor:
Unit: Yuan
Rental income recognized in Rental income recognized in
Name of the lessee Type of leased assets
this period prior period
God Horse Packing
Office building and 742,883 739,491
plant
Window of Wine City Office building 488,595 486,364
Zhongya M edical Office building 260,279 259,091
The Company as a lessee:
Unit: Yuan
Rent recognized in prior
Name of the lessor Type of leased assets Rent recognized in this period
period
Changyu Group Company Office building and plant 3,447,891 3,432,147
11.4.4 Related guarantee
Nil
11.4.5 Inte r-bank borrowing and lending of related parties
Nil
11.4.6 Asset transfer and debt recombination of related parties
Nil
11.4.7 Other related transactions
Unit: Yuan
Item Note Amount incurred in this period Amount incurred in prior period
44,428,033
Trademark use fee (a)
25,000
Patent fee (b)
11.5 Accounts receivable and payable of the related parties
11.5.1 Accounts receivable
Unit: Yuan
Ending balance Beginning balance
Provision
Item Related parties Book Provision for
for bad Book balance
balance bad debts
debts
Accounts receivable Zhongya M edical 4,384,629 2,768,391
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Accounts receivable God Horse Packing 17,137
Accounts receivable Window of Wine City 1,777,525 1,911,157
Other receivables God Horse Packing 1,626,880 813,440
Other receivables Zhongya M edical 285,000
Other receivables Window of Wine City 535,000
11.5.2 Accounts payable
Unit: Yuan
Item Related parties Ending book balance Beginning book balance
Accounts payable God Horse Packing 36,227,351 55,366,785
Accounts payable Zhongya M edical 8,002,230 6,722,667
Accounts payable Wine Culture M useum 7,301,765 4,646,731
Accounts payable Window of Wine City 1,139,407 4,789,600
Accounts payable Cultural Sales 6,360
Other accounts payable Changyu Group Company 3,775,362 78,414,978
Other accounts payable God Horse Packing 450,000
12. Commitment and contingency
12.1 Significant commitme nt
Unit: Yuan
Item Ending balance Beginning balance
M aking long-term asset commitments 469,980,000 996,675,000
12.2 Contingency
As of the balance sheet date, the Group didn’t have any contingency to be disclosed.
13. Matters after balance sheet
13.1 Important non-adjusting events
Nil
13.2 Profit distribution
Unit: Yuan
Profits or dividends to be distributed 411,278,400
Allocated profits or dividends approved to declare upon
411,278,400
discussion
13.3 Other statement of events after the balance sheet date
According to the decision of the Shareholders’ Meeting dated May 17, 2019, based on the issued
capital stock of 685,464,000 shares in 2018, the Company allocated RMB 6 Yuan in cash (including
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
tax) for every 10 shares to all shareholders with the total cash dividends of RMB 411,278,400 Yuan.
Such cash dividends were distributed on July 8, 2019 and July 10, 2019 respectively.
14. Other important matters
Nil
15. Notes on major items in financial statements of the parent company
15.1 Accounts receivable
15.1.1 Accounts receivable disclosed by type
Unit: Yuan
Ending balance Beginning balance
Provision for bad Provision for bad
Book balance Book balance
Type debts debts
Book value Book value
Accrued Accrued
Amount Proportion Amount Amount Proportion Amount
proportion proportion
Accounts receivable for
which provision for bad
1,447,973 100% 1,447,973
debts is accrued on a
single item basis
Accounts receivable for
bad debts is accrued on a
combined basis
Total 1,447,973 100% 1,447,973
15.1.2 Provision for bad debts accrued, withdrawn or transferred back in this period
The provision for bad debts accrued in this period was RMB 0 Yuan; and that withdraw n or
transferred back in this period was RMB 0 Yuan.
15.1.3 Accounts receivable actually cancelled after verification in this period
Nil
15.1.4 Accounts receivable collected by the borrower of top 5 units ranked by the ending
balance
Nil
15.1.5 Accounts receivable de recognized due to transfer of financial assets
Nil
15.1.6 Accounts receivable transferred and included in assets and liabilities
Nil
15.2 Other receivables
Unit: Yuan
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Item Ending balance Beginning balance
Interest receivable 277,785 254,088
Dividends receivable 4,103,925 500,000,000
Other receivables 522,211,903 525,389,268
Total 526,593,613 1,025,643,356
Remarks: The other receivables in the above list refer to those deducting interest receivable and dividends receivable.
15.2.1 Inte rest receivable
Unit: Yuan
Item Ending balance Beginning balance
Fixed deposit 277,785 254,088
Entrusted loan
Bond investment
Total 277,785 254,088
15.2.2 Dividends receivable
Unit: Yuan
Item (or the invested unit) Ending balance Beginning balance
Dividends receivable from subsidiaries 4,103,925 500,000,000
Total 4,103,925 500,000,000
15.2.3 Other receivables
15.2.3.1 Particulars of other receivables classified by nature
Unit: Yuan
Nature Ending book balance Beginning book balance
Accounts receivable from subsidiaries 518,330,846 523,579,831
Deposit and guaranty money receivable 12,500
Other 3,881,057 1,796,937
Total 522,211,903 525,389,268
15.2.3.2 Disclosed by age
Unit: Yuan
Age Ending balance
Within 1 year (including) 422,841,109
1-2 years 99,270,390
2-3 years 100,404
M ore than 3 years
Total 522,211,903
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
15.2.3.3 Provision for bad debts accrued, withdrawn or transferred back in this period
The provision for bad debts accrued in this period was RMB 0 Yuan; and that withdrawn or
transferred back in this period was RMB 0 Yuan.
15.2.3.4 Accounts receivable actually cancelled after verification in this period
Nil
15.2.3.5 Other accounts receivable collected by the borrowe r of top 5 units ranked by
the ending balance
Unit: Yuan
Percentage in the
Ending balance
Nature of total ending
Unit Ending balance Age of provision for
fund balance of other
bad debts
accounts receivable
Internal
Sales Company incomings 34.3%
179,295,939 Within 1 year
and outgoings
Internal
R&D Company incomings 21.3%
111,343,650 Within 1 year
and outgoings
Internal
Laizhou Wine incomings 1.1%
5,549,972 Within 1 year
and outgoings
Internal
Penglai Sales incomings 0.8%
3,992,770 Within 1 year
and outgoings
Internal
Indomita Wine Company Chile, SpA incomings 0.6%
3,330,413 Within 1 year
and outgoings
Total -- 303,512,744 -- 58.1%
15.2.3.6 Accounts receivable related to governmental subsidy
Nil
15.2.3.7 Other accounts receivable derecognized due to transfer of financial assets
Nil
15.2.3.8 Other accounts receivable transferred and included in assets and liabilities
Nil
15.3 Long-term equity investment
Unit: Yuan
Ending balance Beginning balance
Item Impairment Impairment
Book balance Book value Book balance Book value
reserve reserve
Investment in
7,420,803,069 7,420,803,069 7,420,803,069 7,420,803,069
subsidiaries
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Ending balance Beginning balance
Item Impairment Impairment
Book balance Book value Book balance Book value
reserve reserve
Investment in associated
enterprises and joint
ventures
Total 7,420,803,069 7,420,803,069 7,420,803,069 7,420,803,069
15.3.1 Investment in subsidiaries
Unit: Yuan
Provision for
Ending balance
Beginning Increase in this Decrease in this impairment
Invested unit Ending balance of impairment
balance period period accrued in this
provision
period
Xinjiang Tianzhu (a) 60,000,000 60,000,000
Kylin Packaging 23,176,063 23,176,063
Changyu Chateau
28,968,100 28,968,100
(a)
Pioneer
3,500,000 3,500,000
International (b)
Ningxia Growing 36,573,247 36,573,247
National Wine 2,000,000 2,000,000
Icewine Valley (a) 30,440,500 30,440,500
Beijing Chateau (a) 579,910,000 579,910,000
Sales Company 7,200,000 7,200,000
Langfang Sales (b) 100,000 100,000
Langfang Castel (a) 19,835,730 19,835,730
Wine Sales 4,500,000 4,500,000
Shanghai M arketing
300,000 300,000
(b)
Beijing M arketing 850,000 850,000
Jingyang Sales (b) 100,000 100,000
Jingyang Wine (b) 900,000 900,000
Ningxia Wine 222,309,388 222,309,388
Ningxia Chateau 453,463,500 453,463,500
Chateau Tinlot (b) 212,039,586 212,039,586
Shihezi Chateau 812,019,770 812,019,770
Chang’an Chateau 803,892,258 803,892,258
Research,
Development &
3,288,906,445 3,288,906,445
M anufacture
Company (a)
Huanren Wine 22,200,000 22,200,000
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Provision for
Ending balance
Beginning Increase in this Decrease in this impairment
Invested unit Ending balance of impairment
balance period period accrued in this
provision
period
Wine Sales
Company
Francs Champs 236,025,404 236,025,404
M arques del Atrio 190,150,544 190,150,544
Indomita Wine 274,248,114 274,248,114
Kilikanoon Estate,
107,194,420 107,194,420
Australia
Total 7,420,803,069 7,420,803,069
(a) The Company acquired 100% voting right and usufruct of such non-wholly-owned subsidiaries by
means of contract arrangement. Please refer to Note 9.1.
(b) The Company acquired 100% voting right of such subsidiaries by means of indirect holding through its
wholly-owned subsidiaries.
From January to June 2019, there were no restrictions for the invested entities of the Company to transfer
assets to the Company.
15.4 Ope rating income and operating cost
Unit: Yuan
Amount incurred in this period Amount incurred in prior period
Item
Income Cost Income Cost
M ain business 334,207,600 292,023,685 384,520,180 330,810,994
Other business 18,143,402 17,546,895 24,325,031 21,835,995
Total 352,351,002 309,570,580 408,845,211 352,646,989
15.5 Investment income
Unit: Yuan
Amount incurred in this
Item Amount incurred in prior period
period
Income from long-term equity investment by cost method 264,221,755 312,409,576
Income from long-term equity investment by equity method
Investment income from disposal of long-term equity
investment
Investment income of the financial assets measured at their
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
fair values and the variation of which is recorded into the
current profits and losses during the holding period
Investment income gained from disposal of the financial
assets measured at their fair values and the var iation of which
is recorded into the current profits and losses
Investment income of held-to-maturity investment during the
holding period
Investment income of financial assets held for sale during the
holding period
Investment income gained from disposal of financial assets
held for sale
Gains generated from the remaining equity remeasured as per
fair value after the loss of control
Total 264,221,755 312,409,576
16. Supplementary materials
16.1 List of non-current profits/losses in this period
Unit: Yuan
Item Amount Remark
Profits/losses on disposal of non-current assets 1,138
Tax return, deduction and exemption approved beyond the
authority or without formal approval document
Governmental subsidy included in the current profits/losses
(excluding those closely related to the enterprise business and
64,211,892
enjoyed in accordance with the unified standard quota or
ration of the state)
Payment for use of funds by non-financial enterprises included
in the current profits/losses
Income obtained when the investment cost obtained by the
enterprise from subsidiaries, joint-run business and joint
venture is less than the fair value of the net identifiable assets
obtained from the invested units when the investment is made
Profits/losses on exchange of non-monetary assets
Profits/losses on entrusting other people to make investment or
manage assets
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Item Amount Remark
Asset impairment provision accrued due to force majeure such
as natural disaster
Profits/losses on debt restructuring
Enterprise reorganization expenses such as staffing
expenditure and integration expenses, etc.
Profits/losses on those beyond the fair value generated from
transactions with unfair transaction price
Current net profits/losses on subsidiaries acquired from a
business combination under common control from the
beginning to the consolidation date
Profits/losses on contingencies irrelated to the normal business
of the Company
Profits/losses on changes of fair value of tradable financial
assets, derivative financial assets, tradable financial liabilities
and derivative financial liabilities, and investment income
from disposal of tradable financial assets, derivative financial
assets, tradable financial liabilities, derivative financial
liabilities and other investment in creditor's rights, excluding
effective hedging operations relevant to the normal business of
the Company
Transfer-back of accounts receivable with single impairment
test and provision for impairment of contract assets
Profits/losses on external entrusted loans
Profits/losses on fair value changes of investment real estate
with fair value mode for follow-up measurement
Influence of the one-time adjustment of the current
profits/losses in accordance with tax and accounting laws and
regulations on the current profits/losses
Trustee fee income from entrusted operation
Other non-operating income and expenditure besides the
3,411,864
above items
Other profits/losses conforming to the definition of
non-current profits/losses
Yantai Changyu Pioneer Wine Co., Ltd. 2019 Semi-annual Report
Item Amount Remark
M inus: Influenced amount of income tax 16,671,778
Influenced amount of minority shareholders’ equity 40,022
Total 50,913,094 --
16.2 Return on net assets and earnings per share
Earnings per share
Weighted average return on
Profit incurred in this period Basic EPS Diluted EPS
net assets
(Yuan/Share) (Yuan/Share)
Net profit attributable to common
6.13% 0.88 0.88
shareholders of the Company
Net profit attributable to common
shareholders of the Company deducting 5.62% 0.81 0.81
non-incidental profits/losses
16.3 Accounting data difference under domestic and foreign accounting standard
16.3.1 Net profits & net assets difference disclosed in the financial report according to
the international accounting standard and Chinese accounting standard
Unit: Yuan
Net profits Net assets
Amount incurred in Amount incurred in prior
Ending balance Beginning balance
this period period
In accordance with the
603,403,789 635,837,405 9,791,885,091 9,606,099,365
Chinese accounting standard
Item & amount adjusted in accordance with the international accounting standard:
In accordance with the
international accounting 603,403,789 635,837,405 9,791,885,091 9,606,099,365
standard
