Abstract of the 2014 Annual Report of Shenzhen Chiwan Wharf Holdings Limited
Stock code: 000022/200022 Stock abbreviation: Chiwan Wharf A / Chiwan Wharf B Announcement No.: 2015-019
SHENZHEN CHIWAN WHARF HOLDINGS LIMITED
ABSTRACT OF THE 2014 ANNUAL REPORT
I. Important reminders
This abstract is based on the full text of the annual report. For more details, investors are suggested to read the full text disclosed at
the same time with this abstract on the website of Shenzhen Stock Exchange or any other website designated by China Securities
Regulatory Commission.
The Annual Report is written in both English and Chinese. In case of any discrepancy between the two versions, Chinese version
prevails.
According to certain regulations issued by China Securities Regulatory Commission, the Company needn't to prepare Financial
Statements under International Financial Reporting Standards, and thus all the financial data disclosed in this report were prepared
under Chinese Accounting Standards.
Company profile:
Stock abbreviation Chiwan Wharf A, Chiwan Wharf B Stock code 000022, 200022
Stock exchange listed with Shenzhen Stock Exchange
For contact Company Secretary Securities Affairs Representative
Name Ms. Bu Dan Ms. Hu Jingjing
Tel. +86 755 26694222 +86 755 26694222
Fax +86 755 26684117 +86 755 26684117
E-mail cwh@cndi.com cwh@cndi.com
II. Financial highlights and change of shareholders
1. Financial highlights
Unit: RMB
Increase or decrease of
2014 2013 2012
this year over last year
Operating income 1,804,766,176.31 1,780,774,836.30 1.35% 1,783,846,134.76
Net profit attributable to shareholders of
417,594,271.33 502,894,547.79 -16.96% 467,103,270.43
the parent
Net profit attributable to shareholders of
the parent after extraordinary gains and 417,628,589.12 502,469,158.84 -16.88% 464,592,323.43
losses
Net cash flows from operating activities 818,315,147.74 897,178,297.23 -8.79% 698,472,452.71
Basic EPS (RMB/share) 0.648 0.780 -16.92% 0.724
Diluted EPS (RMB/share) 0.648 0.780 -16.92% 0.724
ROE (%) 10.36% 13.26% -2.90% 13.15%
Increase or decrease of
As at 31 Dec.
As at 31 Dec. 2014 As at 31 Dec. 2013 this year-end than last
2012
year-end
Total assets 6,935,824,199.68 7,346,529,214.70 -5.59% 6,781,130,451.10
Total shareholder’s equity attributable to
4,115,298,831.59 3,947,846,392.77 4.24% 3,678,032,085.18
equity holders of the parent
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Abstract of the 2014 Annual Report of Shenzhen Chiwan Wharf Holdings Limited
2. Shareholdings of the top 10 shareholders
Total number of shareholders at
Total number of 34,990 shareholders, with 25,940 35,379 shareholders, with 25,714
the end of the fifth trading day
shareholders at the end being A-share holders, and 9,050 being being A-share holders, and 9,665
before the disclosure date of the
of the reporting period B-share holders being B-share holders
annual report
Shareholdings of top ten shareholders (all being shareholders holding shares not subject to trading moratorium)
Percentage of Shares not subject Shares Type of
Nature of
Name of shareholder (full name) shareholding to trading pledged or shares (A, B,
shareholder
(%) moratorium (share) frozen (share) H or other)
CHINA NANSHAN DEVELOPMENT
32.52% 0 209,687,067 0
(GROUP) INC.
SHENZHEN MALAI STORAGE CO., LTD. 25% 0 161,190,933 0
KEEN FIELD ENTERPRISES LIMITED Foreign-funded 8.58% 0 55,314,208 Unknown
CMBLSA RE FTIF TEMPLETON ASIAN
Foreign-funded 7.43% 0 47,914,954 Unknown
GRW FD GTI 5496
CMBNA/STICHTING PENS FND ABP Foreign-funded 0.54% 958,647 3,463,503 Unknown
GIC PRIVATE LIMITED Foreign-funded 0.52% 3,360,777 3,360,777 Unknown
DEUTSCHE BANK
0.44% 2,846,082 2,846,082 Unknown
AKTIENGESELLSCHAFT
TEMPLETON ASIAN GROWTH FUND Foreign-funded 0.41% 0 2,657,852 Unknown
BBH A/C VANGUARD EMERGING
Foreign-funded 0.4% 0 2,595,918 Unknown
MARKETS STOCK INDEX FUND
KUMPULAN WANG PERSARAAN
Foreign-funded 0.37% 0 2,368,067 Unknown
(DIPERBADANKAN)
China Merchants Holdings (International) Co., Ltd. (―CMHI‖) was a shareholder of China
Nanshan Development (Group) Inc. (―CND Group‖), Shenzhen Malai Storage Co., Ltd.
Explanation on associated relationship or/and
(Malai Storage) was a wholly-funded subsidiary of CMHI, and Keen Field Enterprises
persons acting in concert among the
Limited (KFEL ) was also a wholly-funded subsidiary of CMHI. Other than that, the
above-mentioned shareholders:
Company does not know whether the other non-restricted shareholders are related parties
or not.
3. Relation between the Company and its actual controller in the form of diagram
State-Owned Assets Supervision and
Administration Commission of the State Council
100%
China Merchants Group
54.62%
China Merchants Holdings (International)
Company Limited
entrusted to
manage 100% 100% 37.02%
32.52% of the
Company's Shenzhen Malai Keen Field Enterprises China Nanshan Development
shares held by Storage Co., Ltd. Limited (Group) Incorporation
CND
25% 8.58% 32.52%
Shenzhen Chiwan Wharf Holdings Limited
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Abstract of the 2014 Annual Report of Shenzhen Chiwan Wharf Holdings Limited
III. Discussion and analysis by the management
(I) Review of operation in the reporting period
The Company is principally engaged in the handling, warehousing and transportation of containers and bulk
cargoes, as well as the provision of related services. The Company has 13 container and bulk cargo berths in
Chiwan Port (Shenzhen), 3 container berths in Mawan Port (Shenzhen) and 5 bulk cargo berths in Machong Port
(Dongguan). The Company also has an investment in Laizhou Wharf in Shandong Province.
In 2014, the global economy recovered slowly in an imbalanced way with notably dividend growth in different
countries and regions. International trade started to grow at a low speed, with falling prices for international bulk
commodities. China’s economy stepped into a growth adjustment period with its GDP growth slowing down to
7.4% for the year. The economy was increasingly driven by consumption instead of investment, and the market
institutional reform further deepened. Meanwhile, the government carried out the development strategy of ―One
Belt and One Road‖, and expanded and upgraded the Free Trade Zone.
1. Container handling business
2014 witnessed a moderate growth in global demand in maritime transportation and a periodical low in growth of
the container shipping capacity. But thanks to an increased rate of ship utilization and a sharp decline in fuel oil
cost, the profitability of the industry as a whole improved from last year. With more and more liner companies
joining in, the four unions (CKYHE, G6, 2M, O3) already took up an approximate 80% share in the market of
shipping and the shipping routes around the world were reshuffled. The number of big ships continued to increase,
which set out higher requirements for the hardware and software resources of wharfs such as routes, berths,
equipment, operation and the customs clearance efficiency.
In 2014, wharfs in Shenzhen handled 24.03 million TEU containers, staying No. 3 in the world ranking. The
Company achieved a container throughput of 4.958 million TEU, down 7.3% year on year, accounting for 21% in
the Shenzhen market, representing a slight drop from 2013. As we mainly handled international containers, the
continuous weakness in global trade exerted a greater pressure on our business development. Meanwhile, we had
a relatively small number of clients in container handling and their strategic adjustments to shipping routes caused
more fluctuations to our business. In 2014, we finished upgrading the berths to handle larger ships. We also built
up a barge information service platform—―Smart Port‖—to vigorously promote the barge business, to attract more
local orders through expanding end clients, optimized the business structure and gave full play to the berth
resources so as to maintain relative stability in the container handling business.
2. Bulk cargo handling business
Due to a weak global demand for and the falling prices of bulk commodities, the international dry bulk
transportation market exhibited sluggishness, with BDI dropping approximately 30% through the year of 2014.
The volume of imported bulk commodities increased, but their prices were falling. The inversion of grain prices at
home and abroad stimulated a surge in import. Meanwhile, material changes occurred to the grain import structure.
The total import of the three major grain varieties—wheat, rice and corn—decreased while that of corn
alternatives like sorghum and barley increased considerably. Also, the total import of fertilizers to China kept
growing, with a significant increase in potash fertilizer import and a drop in compound fertilizer import. In our
bulk cargo handling business, we mainly handled grain and feedstuff in foreign trade and fertilizers in import, so
the growth and structural changes of imported grain and fertilizers directly increased our business volume and
changed our business structure.
In the reporting period, the Company achieved a bulk cargo throughput of 15.139 million tons, up 13.7% from the
year earlier. In 2014, we closely followed changes in the industry policies, accurately seized market opportunities,
and proactively expanded grain and feedstuff handling in foreign trade. As a result, the business structure was
further optimized and the rates increased as well. The Machong Port Phase II Wharf went into operation as
scheduled and our professional granaries were brought into full play, both of which contributed to a substantial
growth in our grain and feedstuff handling business through the year. The fertilizer handling business was
successfully moved from Chiwan Port to Machong Port and maintained stability as a whole. Chiwan Port carried
out a strategic adjustment to its business structure, canceling the storage yards outside the port according to
business need to reduce operating costs. It achieved a cargo throughput of 5.502 million tons in 2014, down
23.8% from last year, but still accounting for 23% in the total bulk cargo throughput of the ports in Shenzhen, up
by 3 percentage points from 2013. Meanwhile, the Machong Phase II 675-meter frontage started trial operation,
gradually bringing out our advantage in port resources. and a great achievement in business expansion. As a result,
Machong Port handled a total of 9.637 million tons of cargoes throughout the year, representing a considerable
YoY growth of 58.3%.
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Abstract of the 2014 Annual Report of Shenzhen Chiwan Wharf Holdings Limited
Business highlights of the Company for the past three years are set out as follows:
Business highlight 2014 2013 2012
Total throughput (thousand tons) 63,002 65,894 61,533
Among which: Container throughput (thousand TEU) 4,958 5,346 5,311
Chiwan Port 3,712 3,990 3,946
Mawan Port 1,246 1,356 1,365
Throughput of bulk cargos (thousand tons) 15,139 13,311 10,699
Chiwan Port 5,502 7,223 6,534
Machong Port 9,637 6,088 4,165
Hours charged for tow trucks (thousand hours) 1,170 1,230 1,179
Hours charged for tugboats (hour) 28,642 30,247 31,707
In the reporting period, we enhanced internal management, effectively improving the overall management
capability. We also streamlined our system and carried out the Flat Management; followed changes in financial
policies, optimized our liability structure and reduced our capital costs; enhanced audit on internal control and
repaired defects in internal control; carded the handling processes and enhanced benchmarking in the industry to
increase the operation efficiency; and attached importance to utilization of informatized management tools to
improve the management efficiency in an all-round way. At the same time, our efforts in technical innovation
produced a remarkable result. We continued to innovate in business model, provided more value-added services to
our clients and promoted higher-level strategic cooperation with our core clients. We also emphasized and
encouraged technical innovation and application, and commercialization of our multiple technical achievements
generated some great economic benefits.
(II) Outlook of the Company’s future development
1. Development trends and competition status of the industry in which the Company is engaged
In 2015, the slow recovery of the global economy is expected to continue, with its overall situation expectedly
improved from 2014. However, risk factors that might drag down the economy still exist such as the fragile
recovery of the Euro Zone economy, the slowdown in growth of emerging economies and the political situations
in some regions. Still in the transition stage to a ―new normal‖ state of development, China’s economy will
expectedly exhibit a slowdown in the steady growth, with its annual GDP growth staying at around 7%. It will be
difficult for demand at home and abroad to increase significantly and the growth pick-up will be limited.
International shipping will probably continue to recover, over-capacity in container shipping may be eased, and
large ships and liner unions will normalize. In 2015, China will remain the center of global container shipping,
with demand expectedly continuing to grow. But some volatility may occur due to the existence of multiple
uncertainties.
Thanks to recovery in the industry, the container throughput in the Pearl River Delta is expected to achieve a
steady growth. Due to a faster industrial relocation from the Pearl River Delta with large fluctuations, growth in
container handling is slowing down and competition among ports will be increasingly fierce during the recovery
period of the industry. In the long run, our position as a hub port for containers going through the Pearl River
Delta will remain the same, with relative stability in our container throughput. Meanwhile, as we input more
efforts to market expansion and optimize our business structure, there is still some room for our container
throughput to grow. As for the bulk cargo handling business, as the supporting warehousing facilities for Machong
Port go into operation step by step, our overall market competitiveness will be greatly boosted. Meanwhile, our
traditionally strong varieties of cargoes have entered a large-scaled, professional and high-efficient operation, and
there is room for us to expand new varieties of cargoes. Therefore, our bulk cargo handling business will maintain
a steady growth.
2. Business plan for 2015
We will pay close attention to developments in the macro-economy and social changes, proactively study changes
in the industry and market brought by the government’s strategy of ―One Belt and One Road‖ and the free trade
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Abstract of the 2014 Annual Report of Shenzhen Chiwan Wharf Holdings Limited
zone policy of Guangdong Province, and decide our operating goals and measures taken to achieve them for 2015
based on our actual situation so as to maximize our operating earnings.
In container handling, we will proactively deal with expanded liner unions, optimize our business structure and
give full play to our berth resources. We will also work with the government to push forward the Tonggu Channel
Phase II widening project to cater for more and more large ships. Meanwhile, we will continue to improve our
operational efficiency and services to maintain stability in core clients and main routes, and take the initiative to
seize market opportunities to expand business.
As for bulk cargo handling, we will focus on construction of warehousing facilities in Machong Port and
upgrading of resources in Chiwan Port so as to optimize resource allocation and achieve coordinated development
between the two ports. Meanwhile, we will also focus on business expansion and beef up market breeding to keep
a sustained and steady growth.
We will continue to provide professional, quality and efficient comprehensive port services for clients, maintain a
steady growth of the overall business scale, and we will proactively seek for business expansion and service
innovation. And attention will be paid to coordination with local counterparts for healthy competition. We will
also promote R&D innovation and lean management in depth to reduce costs, improve our operating efficiency
and management capability. And we will continue to push forward institutional improvement, safe production,
energy-saving & emission reduction and other major tasks.
3. Capital needs and expenditure plan for 2015
To implement our future development strategies and achieve the business goals we have set, a capital expenditure
of RMB 310.3917 million is planned for 2015, of which RMB 219.1626 million will be invested in wharfs and
warehouses, RMB 56.1330 million in equipments and ships, RMB 16.3918 million in IT and RMB 18.7043
million in administration. The said capital expenditures will be mainly funded by cash inflows from operating
activities of the Company and bank borrowings.
(III) No significant change occurred to the structures of main business lines and profit during the
reporting period, and operating revenue was almost the same as that of last year. Main financial
indicators are as follows:
Item 2014 2013 +/-
Operating income 1,804,766,176.31 1,780,774,836.30 1.35%
Operating profit 671,869,131.28 759,282,870.84 -11.51%
Net profits attributable to shareholders of the parent 417,594,271.33 502,894,547.79 -16.96%
Operating profit went down 11.51% mainly because ① operating costs increased 8.10% as the labor cost
increased and the depreciation in fixed assets increased as a result of shift of the construction in progress of the
Machong Project to fixed assets; ② financial expenses increased considerably by 89.54% due to higher interest
expenses caused by a higher average interest rate on loans, a decrease in capitalized interest upon basic
completion of the Machong Project, and an increase in the exchange loss caused by the depreciation of RMB; and
③ the investment gains on joint ventures and associated companies decreased 9.41% year on year as some of
them achieved a lower profit than last year as a result of the unfavorable macro market environment.
Net profit attributable to shareholders of the Company (without subsidiaries) recorded a drop of 16.96% mainly
because ① the containers we were handling decreased in number; ② the operating costs and financial expenses
both went up, and the investment gains decreased.
IV. Matters in relation to financial reporting
1. Explain any change of the accounting policies, accounting estimates or accounting methods as compared
with the financial reporting of last year
The Group has applied new standards of Accounting Standard for Business Enterprises No. 39– Fair Value
Measurement (CAS 39), Accounting Standard for Business Enterprises No.40–Joint Arrangements (CAS 40),
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Abstract of the 2014 Annual Report of Shenzhen Chiwan Wharf Holdings Limited
Accounting Standard for Business Enterprises No. 41– Disclosure of Interests in Other Entities (CAS 41) and
amendments to Accounting Standard for Business Enterprises No.2–Long-term Equity Investments (CAS 2),
Accounting Standard for Business Enterprises No.9–Employee Benefits (CAS 9), Accounting Standard for
Business Enterprises No. 30– Presentation of Financial Statements (CAS 30) and Accounting Standard for
Business Enterprises No.33–Consolidated Financial Statements (CAS 33) issued by the Ministry of Finance in
2014 from 1 July, 2014; moreover, the Group has applied Accounting Standard for Business Enterprises No. 37–
Presentation of Financial Instruments (CAS 37) revised by the Ministry of Finance for the first time in 2014
annual financial statements.
1. Long-term equity investments
Before the implementation of Accounting Standard for Business Enterprises No.2–Long-term Equity Investments
(Revised), the equity investments that the Group had no joint control or significant influence over the investee and
were not quoted in an active market, also whose fair value could not be reliably measured were accounted for as
long-term equity investments under the cost method.
After the implementation of Accounting Standard for Business Enterprises No.2–Long-term Equity Investments
(Revised), the equity investments that the Group have no joint control or significant influence over the investee
and are not quoted in an active market, also whose fair value cannot be reliably measured are accounted for as
available-for-sale financial assets. The above changes in accounting policy have been applied retrospectively;
please refer to the table below for the impact of such changes in accounting policy.
2. Financial statement presentation
Under Accounting Standard for Business Enterprises No. 30– Presentation of Financial Statements (Revised),
items of other comprehensive income are grouped into the following two categories: (1) items that will not be
reclassified subsequently to profit or loss; (2) items that may be reclassified subsequently to profit or loss when
specific conditions are met. CAS 30 also sets out the presentation requirements for other items (e.g. those held for
sale). The financial statements have been prepared in accordance with CAS 30, and the presentation of
comparative financial statements have been adjusted accordingly.
For changes in accounting policies described above, the entity has adjusted the opening balances of the financial
statements or the comparative figures for the prior year retrospectively and restated the comparative financial
statements. The impact of the above changes in accounting policies on the Group’s assets, liabilities and
stockholders' equity as at 1 January 2013 and 31 December 2013 is presented as follows:
Unit: RMB
31/12/2013 Long-term Other 31/12/2013
Deferred
(Before equity comprehensive (After
income
restatement) investments income restatement)
Available-for-sale
5,580,000.00 13,909,200.00 - - 19,489,200.00
financial assets
Long-term equity 1,560,688,285.0
1,574,597,485.03 (13,909,200.00) - -
investment 3
Other comprehensive
- - (10,267,569.50) - (10,267,569.50)
income
Translation differences
arising on translation of
financial statements (13,712,569.50) - 13,712,569.50 - -
denominated in foreign
currencies
Capital reserve 166,143,555.65 - (3,445,000.00) - 162,698,555.65
Other non-current (48,594,551.13
48,594,551.13 - - -
liabilities )
Deferred income - - - 48,594,551.13 48,594,551.13
Total amount of impact on 4,728,076,181.8
4,728,076,181.87 - - -
shareholders' equity 7
Attributable to
3,947,846,392.7
shareholders' equity of the 3,947,846,392.77 - - -
7
parent company
Minority interests 780,229,789.10 - - - 780,229,789.10
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Abstract of the 2014 Annual Report of Shenzhen Chiwan Wharf Holdings Limited
Unit: RMB
01/01/2013 Long-term Other 01/01/2013
(Before equity comprehensive Deferred income (After
restatement) investments income restatement)
Available-for-sale
5,210,000.00 13,909,200.00 - - 19,119,200.00
financial assets
Long-term equity 1,531,041,908.3
1,544,951,108.34 (13,909,200.00) - -
investment 4
Other comprehensive
- - (10,437,217.50) - (10,437,217.50)
income
Translation differences
rising on translation of
financial statements (13,604,717.50) - 13,604,717.50 - -
denominated in foreign
currencies
Capital reserve 165,866,055.65 - (3,167,500.00) - 162,698,555.65
Other non-current
53,652,355.62 - - (53,652,355.62) -
liabilities
Deferred income - - - 53,652,355.62 53,652,355.62
Total amount of impact on 4,465,009,905.4
4,465,009,905.44 - - -
shareholders' equity 4
Attributable to
3,678,032,085.1
shareholders' equity of the 3,678,032,085.18 - - -
8
parent company
Minority interests 786,977,820.26 - - - 786,977,820.26
The above changes in accounting policies have no impact on the Group's net profit and total comprehensive
income. Other Accounting Standards for Business Enterprises issued or revised by the Ministry of Finance in 2014
have no impact on the Group.
The impact of the above changes in accounting policies on the company’s assets, liabilities and stockholders'
equity as at 1 January 2013 and 31 December 2013 is presented as follows:
Unit: RMB
Other
31/12/2013 Long-term equity comprehensive 31/12/2013
(Before restatement) investments income (After restatement)
Available-for-sale financial assets 5,580,000.00 13,909,200.00 - 19,489,200.00
Long-term equity investment 2,249,775,991.91 (13,909,200.00) - 2,235,866,791.91
Other comprehensive income - - 3,445,000.00 3,445,000.00
Capital reserve 153,355,827.18 - (3,445,000.00) 149,910,827.18
Total amount of impact on
1,949,924,895.32 - - 1,949,924,895.32
shareholders' equity
Unit: RMB
Other
01/01/2013 Long-term equity comprehensive 01/01/2013
(Before restatement) investments income (After restatement)
Available-for-sale financial assets 5,210,000.00 13,909,200.00 - 19,119,200.00
Long-term equity investment 2,131,519,861.87 (13,909,200.00) - 2,117,610,661.87
Other comprehensive income - - 3,167,500.00 3,167,500.00
Capital reserve 153,078,327.18 - (3,167,500.00) 149,910,827.18
Total amount of impact on
1,819,929,281.22 - - 1,819,929,281.22
shareholders' equity
The above changes in accounting policies have no impact on the company's net profit and total
comprehensive income. Other Accounting Standards for Business Enterprises issued or revised by
the Ministry of Finance in 2014 have no impact on the company.
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Abstract of the 2014 Annual Report of Shenzhen Chiwan Wharf Holdings Limited
2. Explain any retrospective restatement due to correction of any significant accounting error in the
reporting period
N/A
3. Explain change of the consolidation scope as compared with the financial reporting of last year
The consolidation scope narrowed mainly because the Company absorbed subsidiaries. For details, see XIII,
Section IV in the Company’s 2014 Annual Report disclosed on www.cninfo.com.cn on the same day with this
Abstract.
4. Explanation of the Board of Directors and the Supervisory Committee concerning the “non-standard
audit report” issued by the CPAs firm for the reporting period
N/A
For and on behalf of the Board
Zheng Shaoping
Chairman
Shenzhen Chiwan Wharf Holdings Limited
Dated 27 March 2015
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