山东晨鸣纸业集团股份有限公司
SHANDONG CHENMING PAPER HOLDINGS LIMITED*
(a joint stock company incorporated in the People’s Republic of China with limited liability)
2010 third quarter report
§1 Important
1.1 The board of directors (the “Board”), the supervisory committee (the “Supervisory Committee”) and the directors (the “Directors”), supervisors (the “Supervisors”) and senior management (the “Senior Management”) of Shandong Chenming Paper Holdings Limited (the “Company”, “us”, and “we”) hereby warrant that there are no false representations, misleading statements or material omissions contained in this report (the “Report”), and jointly and severally accept full responsibility for the truthfulness, accuracy and completeness of its contents. This Report has been prepared in both Chinese and English. For any discrepancies, the Chinese version shall prevail.
1.2 None of the Directors, Supervisors and Senior Management is unable to warrant the truthfulness, accuracy and completeness of the contents of this report or holds any dissenting views.
1.3 This quarterly report was considered and approved by the fourth meeting of the sixth session of the Board of the Company with all directors present.
1.4 The third quarter financial statements of the Company and its subsidiaries (collectively referred to as the “Group”) prepared in accordance with Accounting Standards for Business Enterprises issued by the Ministry of Finance of PRC have not been audited.
1.5 Chen Hongguo, the person in charge of the Company, Wang Chunfang, the financial controller of the Company, and Li Dong, head of accounting department (the person in charge of accounting) hereby declare their assurance of the truthfulness and completeness of the financial report contained in the quarterly report.
1§2 Company Information
2.1 Major financial data and indicators
Unit: RMB
2010.9.30
2009.12.31
Change (%)
Total assets (RMB)
30,873,565,770.13
28,213,084,875.02
9.43%
Equity attributable to equity holders of the Company (RMB)
13,212,721,558.38
12,991,904,321.68
1.70%
Share capital (share)
2,062,045,941.00
2,062,045,941.00
0.00%
Net assets per share attributable to equity holders of the Company (RMB/share)
6.41
6.30
1.75%
July - September 2010
Comparison with the corresponding period of last year (%)
January - September 2010
Comparison with the corresponding period of last year (%)
Total operating revenue (RMB)
4,343,250,079.02
5.41%
12,519,891,756.01
15.97%
Net profit attributable to equity holders of the Company (RMB)
231,699,904.71
-23.83%
839,568,874.95
81.85%
Net cash flows from operating activities (RMB)
—
—
1,247,283,449.67
50.65%
Net cash flows per share from operating activities (RMB/share)
—
—
0.60
50.65%
Basic earnings per share (RMB/share)
0.12
-14.29%
0.41
86.36%
Diluted earnings per share (RMB/share)
N\A
N\A
Weighted average return on net
1.77%
-0.67%
6.39%
2.68%
2assets (%)
Weighted average return on net assets after extraordinary gains and losses attributable to equity holders of the Company (%)
1.62%
-0.53%
5.98%
2.91%
Unit: RMB
Extraordinary gain or loss items
Amounts for the period from the beginning of the year to the end of the reporting period
Gain or loss on disposal of non-current assets
-570,820.64
Government grants recognised in profit or loss during the period, except for government grants closely related to the corporate business that were given under at a fixed standard amount or quantity as stipulated by the State
70,524,952.12
Gain or loss on debt restructuring
50,693.08
Except for effective hedging business conducted over the course of ordinary operation of the Company, gain or loss arising from fair value change in held-for-trading financial assets and held-for-trading financial liabilities, as well as investment gain on disposal of held-for-trading financial assets and held-for-trading financial liabilities and available-for-sale financial assets
-3,000,000.00
Other non-operating income and expenses other than the above items
7,590,134.60
Effect of minority interests
-9,035,543.77
Effect of income tax
-10,091,901.49
Total
55,467,513.90
32.2 Total number of shareholders and the shareholding of the top ten shareholders of non-restricted shares as at the end of the reporting period
Unit: share
Total number of shareholders as at the end or the reporting period
Total number of shareholders was 158,325, of which 127,527 were holders of A shares, 30,138 were holders of B shares and 660 were holders of H shares.
Shareholding of the top ten shareholders of tradable shares
Name of shareholders
Number of non-restricted tradable shares held as at the end of the reporting period
Class
HKSCC NOMINEES LIMITED
389,871,000
Overseas listed foreign shares
PLATINUM ASIA FUND
44,366,377
Domestic listed foreign shares
CHINA CONSTRUCTION BANK — 鵬華價值優勢股票型證券投資基金
33,500,000
RMB ordinary shares
HTHK-MANULIFE CHINA VALUE FUND
22,892,182
Domestic listed foreign shares
MANULIFE GLOBAL FUND
20,324,321
Domestic listed foreign shares
BBH BOS S/A FIDELITY FD - CHINA FOCUS FD
19,274,231
Domestic listed foreign shares
BANK OF CHINA — 易方達深證100交易型開放式指數證券投資基金
15,154,827
RMB ordinary shares
BILL & MELINDA GATES FOUNDATION TRUST
14,407,244
RMB ordinary shares
DRAGON BILLION CHINA MASTER FUND
13,853,877
Domestic listed foreign shares
INDUSTRIAL AND COMMERCIAL BANK OF CHINA — 易方達價值精選股票型證券投資基金
12,009,772
RMB ordinary shares
§3 Material matters
3.1 Details of and reasons for significant changes in major accounting statement items and financial indicators of the Company
√ Applicable Not Applicable
41. Analysis of the assets and liabilities of the Company
Unit: (RMB)
Item
30 September 2010
31 December 2009
Change (%)
Reason for change
Monetary funds
1,685,100,169.60
2,892,923,245.93
-41.75
(1)
Held-for-trading financial assets
8,650,000.00
14,900,000.00
-41.95
(2)
Inventory
3,016,095,837.76
2,226,579,492.59
35.46
(3)
Other current assets
228,224,742.46
90,756,205.60
151.47
(4)
Construction in progress
5,217,083,035.72
1,997,961,262.18
161.12
(5)
Construction materials
57,739,457.21
42,912,962.27
34.55
(5)
Other non-current assets
655,923,013.46
496,724,974.94
32.05
(6)
Short-term borrowings
1,160,394,104.94
3,103,153,828.18
-62.61
(7)
Held-for-trading financial liabilities
3,200,000.00
6,450,000.00
-50.39
(2)
Bills payable
357,055,196.95
544,532,508.19
-34.43
(8)
Interest payable
78,802,583.31
5,050,000.00
1,460.45
(9)
Dividend payable
78,807.70
-100.00
(10)
Other payables
430,492,976.30
321,220,579.61
34.02
(11)
Other current liabilities
3,331,958,750.01
100.00
(12)
Other non-current liabilities
2,283,840,548.04
1,189,484,415.60
92.00
(13)
Explanation on the main reasons leading to the changes:
(1) Monetary funds decreased by 41.75% as compared to the beginning of the year primarily due to more project investments made by the Company.
(2) Held-for-trading financial assets decreased by 41.95% and held-for-trading financial liabilities decreased by 50.39% primarily due to the change in fair value
5of the forward exchange contracts of the Company.
(3) Inventory increased by 35.46% as compared to the beginning of the year primarily due to the increased inventory of finished products during the period as compared to the beginning of the year resulting from the market change and the cost rise.
(4) Other current assets increased by 151.47%as compared to the beginning of the year primarily due to an increase of the value-added tax to be deducted during the period.
(5) Construction in progress increased by 161.12% and construction materials increased by 34.55% primarily due to the investments made in the Zhanjiang pulp project, and the projects of tissue paper of production capacity of 98,000 tonnes and of copperplate paper of production capacity of 800,000 tonnes.
(6) Other non-current assets increased by 32.05% as compared to the beginning of the year primarily due to plantation and growing of timber assets and change in their fair value.
(7) Short-term borrowings decreased by 62.61% as compared to the beginning of the year primarily due to repayment of short-term borrowings by the issue of short-term debentures by the Company.
(8) Bills payable decreased by 34.43% as compared to the beginning of the year primarily due to few bills made by the Company during the period.
(9) Dividend payable increased by 1460.45% as compared to the beginning of the year primarily due to the appropriation of the interests of the medium-term notes by the Company.
(10) Dividend payable decreased by 100% as compared to the beginning of the year primarily due to the dividend payment by the Company.
(11) Other payables increased by 34.02% as compared to the beginning of the year primarily due to the increase in security deposits of the Company during the period.
(12) Other current liabilities increased by RMB 3,332 million as compared to the beginning of the year primarily due to the issued of short-term debentures by the Company during the period.
(13) Other non-current liabilities increased by 92% primarily due to the issue of medium-term notes by the Company during the period.
62. Explanation on significant change of income statement compared with the corresponding period of last year
Unit: (RMB)
Item
30 September 2010
30 September 2009
Change (%)
Reason for change
Business taxes and surcharges
15,563,122.29
11,483,327.57
35.53
(1)
Loss on impairment of assets
49,427,434.69
-6,028,723.43
919.87
(2)
Investment income
-3,985,835.17
-13,898,520.99
71.32
(3)
Operating profit
1,055,786,588.38
577,731,551.67
82.75
(4)
Non-operating expenses
9,006,476.98
6,315,760.46
42.60
(5)
Total profit
1,153,135,395.89
692,765,968.31
66.45
(4)
Net profit
948,521,577.89
532,169,708.15
78.24
(4)
Net profit attributable to equity holders of the Company
839,568,874.95
461,673,747.96
81.85
(4)
Minority interests
108,952,702.94
70,495,960.19
54.55
(4)
Explanation on the main reasons leading to the changes
(1) Business taxes and surcharges increased by 35.53% as compared to the corresponding period of last year primarily due to the increase of the business taxes on interest discounted during the period.
(2) Loss on impairment of assets increased by 919.87% as compared to the corresponding period of last year primarily due to the provision for decline in value of inventories reversed in the corresponding period of last year and change in aging of trade receivables.
(3) Investment income increased by 71.32% as compared to the corresponding period of last year primarily due to an decrease in the losses incurred by the associates during the period as compared with that of the corresponding period of last year.
(4) Operating profit, total profit, net profit, net profit attributable to equity holders of the Company and minority interests increased by 82.75%, 66.45%, 78.24%, 81.85% and 54.55% respectively as compared to the corresponding period of last year primarily due to the first and second quarter of last year being affected by the economic crisis and a significant rise in the selling price and gross profit margin during the period as compared to the last corresponding period of last year. 7(5) Non-operating expenses increased by 42.6% as compared to the corresponding period of last year primarily due to an increase of the non-recurring out-of-pocket expenses of the Company as compared to the corresponding period of last year.
3. Cash flows during the reporting period
Item
The reporting period
The corresponding period of last year
Change (%)
Net cash flows from operating activities
1,247,283,449.67
827,943,359.85
50.65
Net cash flows from investment activities
-3,565,098,861.83
-1,416,501,328.89
-151.68
Net cash flows from financing activities
1,541,312,029.27
304,666,048.83
405.90
Explanation on the main reasons leading to the changes:
(1) Net cash flows from operating activities increased by 50.65% as compared to the corresponding period of last year primarily due to the increased revenue resulting from a significant rise in the selling price of the Company during the period as compared to the corresponding period of last year.
(2) Net cash flows from investment activities decreased by 151.68% as compared to the corresponding period of last year primarily due to the greater investments made in the Zhanjiang pulp project, the high-end culture paper project of an annual production capacity of 450,000 tonnes, the tissue paper project of Meilun Paper of an annual production capacity of 98,000 tonnes , the copperplate paper project of an annual production capacity of 800,000 tonnes and the white coated linerboard project of an annual production capacity of 600,000 tonnes.
(3) Net cash flows from financing activities increased by 405.9% as compared to the corresponding period of last year primarily due to an increase of banking loans resulting from the factors such as greater investment made by the Company.
3.2 The progress of significant events and analysis of their impact and solutions
3.2.1 Non-standard opinion
Applicable √ Not Applicable
3.2.2 Provision of capital to the controlling shareholder or its related parties or provision of guarantee in favour of any external party in violation of the prescribed
8procedures by the Company
Applicable √ Not Applicable
3.2.3 Execution of material contracts in the ordinary course of business and their performance
Applicable √ Not Applicable
3.2.4 Others
Applicable √ Not Applicable
3.3 Performance of undertakings by the Company, shareholders and beneficial controllers
Applicable √ Not Applicable
3.4 Warning of cumulative net profit for the period between the beginning of the year to end of next reporting period being projected to be losses or expected material change as compared to the same period last year and its explanation
Applicable √ Not Applicable
3.5 Other significant events that require explanation
3.5.1 Securities investment
Applicable √ Not Applicable
3.5.2 Reception of research investigations, communications and interviews during the reporting period
9Date of reception
Place of reception
Manner of reception
Parties accommodated
Main topics of discussion and information provided
8 July 2010
Shouguang, Shandong
On-site research and investigation
Guo Yuan Securities
Matters including recent development of the industry and development trend in the future, production and operation of the Company, as well as strategic development
9 September 2010
Shouguang, Shandong
On-site research and investigation
Comgest Far East Limited, Huatai United Securities
Matters including recent development of the industry and development trend in the future, production and operation of the Company, as well as strategic development
14 September 2010
Shouguang, Shandong
On-site research and investigation
China Merchants Securities, Guotai Asset Management, China Post Fund, China International Fund Management, China Life Insurance
Matters including recent development of the industry and development trend in the future, production and operation of the Company, as well as strategic development
17 September 2010
Shouguang, Shandong
On-site research and investigation
Yuanta Securities (Hong Kong), Korea Investment & Securities
Matters including recent development of the industry and development trend in the future, production and operation of the Company, as well as strategic development
103.6 Investment in derivatives
√ Applicable □ Not Applicable
Risk analysis of positions in derivatives during the reporting period and explanation on risk control measures (including but not limited to market risk, liquidity risk, credit risk, operation risk, legal risk etc.)
The Company held two forward exchange product transactions amounting to USD100 million during the reporting period. The Company made forward exchange settlement contracts in China and Chenming (HK) Limited made forward exchange settlement contracts in Hong Kong. The product transactions were handled by the Shouguang branch of China Construction Bank Corporation and the Hong Kong branch of China Construction Bank Corporation at the same time. The currency risk was jointly locked up by the Company and Chenming (HK) Limited. The risk in the products had been assessed by the related departments of the Company and the risk was under control.
Change in market price or fair value of derivatives invested during the reporting period, where specific methods and relevant assumptions and parameters used shall be disclosed in the analysis of the fair value of derivatives
Based on the exchange rate on 30 September as confirmed by China Construction Bank, the Company recognized the change in the fair value of the derivatives in the reporting period. The gain on change in fair value recognised during the reporting period was -3,000,000.00
Explanation on any significant changes in the Company’s accounting policies and specific accounting principles on derivatives between the reporting period and the last reporting period
The investment in derivatives was subsequently measured at fair value by the Company. The gain or loss on change in fair value was recognized in profit or loss during the period. There is no material change in the accounting policies and the specific accounting audit principles of the derivatives of the Company during the reporting period as compared to the last reporting period.
Specific opinions of independent directors, the sponsor or financial advisor on the investment in derivatives and risk control of the Company
In the opinion of the Audit Committee of the Board and the independent Directors of the Company, the forward exchange product transactions of the Company were operated in accordance with the “Rules on the Administration of Financial Derivatives＂(《關於金融衍生品管理辦法》) of Shenzhen Stock Exchange and in strict compliance with the “internal management policy for forward exchange contracts＂ (《遠期結售匯內控管理制度》) established by the Company during the reporting period. The currency risk of the transactions was jointly locked up by the Company and Chenming (HK) Limited and the transaction risk was under control.
11The pricing of the transactions were objective and fair at arm’s length, thus safeguarding the interest of the shareholders of the Company.
3.6.1 Positions in investment in derivatives as at the end of the reporting period
√ Applicable Not Applicable
Unit: RMB
Type of contract
Opening contract amount
Closing contract amount
Gain or loss during the reporting period
Closing contract amount as a percentage of the net assets of the Company as at the end of the reporting period
Buy USD50.00 million
-328,900,000.00
-328,900,000.00
-4,800,000.00
-2.49%
Buy USD100.00 million
-669,900,000.00
0.00
-7,000,000.00
0.00%
Buy USD50.00 million in 2010
0.00
-335,600,000.00
-6,300,000.00
-2.54%
Sell USD50.00 million
332,200,000.00
332,200,000.00
4,750,000.00
2.51%
Sell USD100.00 million
676,400,000.00
0.00
1,400,000.00
0.00%
Sell USD50.00 million in 2010
0.00
338,950,000.00
8,950,000.00
2.57%
Total
9,800,000.00
6,650,000.00
-3,000,000.00
0.05%
12§4 Appendices
4.1 Balance sheet
Prepared by: Shandong Chenming Paper Holdings Limited As at 30 September 2010
Unit: RMB
Closing balance
Opening balance
Items
Consolidated
Parent company
Consolidated
Parent company
CURRENT ASSETS:
Monetary funds
1,685,100,169.60
933,379,157.34
2,892,923,245.93
2,037,930,262.40
Balances with clearing companies
—
—
—
—
Loans to banks and other financial institutions
—
—
—
—
Held-for-trading financial assets
8,650,000.00
8,650,000.00
14,900,000.00
Bills receivable
2,437,313,384.94
1,405,819,631.91
2,704,799,074.02
1,915,645,987.88
Accounts receivable
1,911,801,948.56
1,898,670,166.46
1,528,991,497.69
1,387,208,451.92
Prepayments
977,590,255.76
527,346,529.44
1,000,772,875.85
826,816,984.44
Premium receivable
—
—
—
—
Receivables from reinsurers
—
—
—
—
Reinsurance contract reserves receivable
—
—
—
—
Interest receivable
—
—
—
—
Dividend receivable
—
31,532,551.06
—
188,362,997.10
Other receivables
88,801,497.81
3,502,065,503.77
81,210,643.94
2,045,123,389.13
Financial assets purchased under agreements to resell
—
—
—
—
Inventory
3,016,095,837.76
1,362,461,055.83
2,226,579,492.59
901,471,663.46
Non-current assets due within one year
—
—
—
—
Entrusted loans due within one year
—
1,867,000,000.00
—
1,688,000,000.00
Other current assets
228,224,742.46
63,203,513.19
90,756,205.60
35,927,902.98
Total current assets
10,353,577,836.89
11,600,128,109.00
10,540,933,035.62
11,026,487,639.31
NON-CURRENT ASSETS:
Loans and advances to customers
—
—
—
—
Available-for-sale financial assets
—
—
—
—
Entrusted loans
—
500,000,000.00
—
395,000,000.00
Held-to-maturity investments
—
—
—
—
Long-term receivables
—
—
—
—
Long-term equity investments
76,978,852.32
5,667,664,660.21
80,984,687.49
4,091,670,495.37
Investment properties
25,122,776.08
25,122,776.08
26,426,468.11
26,426,468.11
Fixed assets
12,998,915,185.87
5,329,988,936.76
13,529,590,915.63
5,741,048,494.95
Construction in progress
5,217,083,035.72
304,197,150.76
1,997,961,262.18
139,440,285.68
Construction materials
57,739,457.21
5,518,350.60
42,912,962.27
6,592,106.05
Disposal of fixed assets
—
—
—
—
Productive biological assets
—
—
—
—
Oil and gas assets
—
—
—
—
Intangible assets
1,306,275,304.72
332,445,226.68
1,313,428,867.12
349,130,281.02
Development expenditure
—
—
—
—
Goodwill
20,283,787.17
—
20,283,787.17
—
Long-term prepaid expenses
23,989,173.56
—
32,411,932.85
—
Deferred income tax assets
137,677,347.13
83,785,077.35
131,425,981.64
73,479,449.99
Other non-current assets
655,923,013.46
—
496,724,974.94
—
13Total non-current assets
20,519,987,933.24
12,248,722,178.44
17,672,151,839.40
10,822,787,581.17
TOTAL ASSETS
30,873,565,770.13
23,848,850,287.44
28,213,084,875.02
21,849,275,220.48
CURRENT LIABILITIES:
Short-term borrowings
1,160,394,104.94
621,984,496.62
3,103,153,828.18
2,637,914,967.54
Borrowings from the central bank
—
—
—
—
Customer bank deposits and due to banks and other financial institutions
—
—
—
—
Placements from banks and other financial institutions
—
—
—
—
Held-for-trading financial liabilities
3,200,000.00
—
6,450,000.00
6,450,000.00
Bills payable
357,055,196.95
259,406,707.23
544,532,508.19
456,914,277.59
Accounts payable
2,542,477,036.27
1,677,275,342.50
2,122,860,892.58
1,349,629,055.79
Advance receipts
194,179,832.65
313,867,671.81
233,123,691.11
168,878,896.38
Assets sold under agreements to repurchase
—
—
—
—
Handling charges and commission payable
—
—
—
—
Staff remuneration payables
194,899,845.17
129,950,433.75
245,501,281.04
133,530,934.62
Taxes payable
138,614,204.62
82,899,361.10
137,491,104.68
70,066,082.73
Interest payable
78,802,583.31
78,802,583.31
5,050,000.00
5,050,000.00
Dividend payable
—
—
78,807.70
78,807.71
Other payables
430,492,976.30
362,452,878.43
321,220,579.61
225,959,345.59
Due to reinsurers
—
—
—
—
Insurance contract reserves
—
—
—
—
Customer brokerage deposits
—
—
—
—
Securities underwriting brokerage deposits
—
—
—
—
Non-current liabilities due within one year
391,461,175.90
301,549,500.00
345,353,527.87
252,423,000.00
Other current liabilities
3,331,958,750.01
3,331,958,750.01
—
—
Total current liabilities
8,823,535,706.12
7,160,147,724.76
7,064,816,220.96
5,306,895,367.95
NON-CURRENT LIABILITIES:
Long-term borrowings
4,677,519,265.09
1,975,602,635.94
5,087,424,182.26
3,418,358,035.94
Bonds payable
—
—
—
—
Long-term payables
—
—
—
—
Deferred income
141,134,594.34
12,567,003.94
121,890,615.92
11,222,282.74
Special payables
—
—
—
—
Estimated liabilities
—
—
—
—
Deferred income tax liabilities
15,265,236.10
—
12,408,618.13
—
Other non-current liabilities
2,283,840,548.04
2,283,840,548.04
1,189,484,415.60
1,189,484,415.60
Total non-current liabilities
7,117,759,643.57
4,272,010,187.92
6,411,207,831.91
4,619,064,734.28
TOTAL LIABILITIES
15,941,295,349.69
11,432,157,912.68
13,476,024,052.87
9,925,960,102.23
OWNERS’ EQUITY (OR SHAREHOLDERS’ EQUITY):
Paid-up capital(or share capital)
2,062,045,941.00
2,062,045,941.00
2,062,045,941.00
2,062,045,941.00
Capital reserves
6,093,493,004.70
6,184,215,988.77
6,093,483,801.92
6,184,215,988.77
Less: Treasury shares
—
—
—
—
Special reserves
—
—
—
—
Surplus reserves
906,929,047.49
894,739,465.58
906,929,047.49
894,739,465.58
General risk provisions
—
—
—
—
Retained profit
4,149,541,390.20
3,275,690,979.41
3,928,586,297.55
2,782,313,722.90
Foreign currency translation differences
712,174.99
—
859,233.72
—
Total equity attributable to equity
13,212,721,558.38
12,416,692,374.76
12,991,904,321.68
11,923,315,118.25
14holders of the company
Minority interests
1,719,548,862.06
—
1,745,156,500.47
—
Total owners’ equity
14,932,270,420.44
12,416,692,374.76
14,737,060,822.15
11,923,315,118.25
TOTAL LIABILITIES AND OWNERS’ EQUITY
30,873,565,770.13
23,848,850,287.44
28,213,084,875.02
21,849,275,220.48
4.2 Income statement for the reporting period
Prepared by: Shandong Chenming Paper Holdings Limited July to September 2010
Unit: RMB
Amounts for the current period
Amounts for the prior period
Items
Consolidated
Parent company
Consolidated
Parent company
I. Total operating revenue
4,343,250,079.02
3,823,699,983.39
4,120,235,923.73
3,556,034,689.58
Including:Operating revenue
4,343,250,079.02
3,823,699,983.39
4,120,235,923.73
3,556,034,689.58
Interest income
—
—
—
—
Earned premium
—
—
—
—
Handling charges and commission income
—
—
—
—
II. Total operating costs
4,056,636,234.66
3,563,528,799.15
3,713,315,016.63
3,242,810,538.06
Including:Operating costs
3,527,120,440.28
3,282,867,167.75
3,255,117,404.31
3,000,839,650.70
Interest expenses
—
—
—
—
Handling charges and commission expenses
—
—
—
—
Surrenders
—
—
—
—
Net claims paid
—
—
—
—
Net change in insurance contract reserves
—
—
—
—
Policyholder dividend expenses
—
—
—
—
Expenses for reinsurance accepted
—
—
—
—
Business taxes and surcharges
5,165,394.55
489,447.02
4,374,294.04
195,741.33
Selling and distribution expenses
204,837,721.64
90,558,199.13
215,787,629.06
119,679,867.19
General and administrative expenses
227,766,185.51
111,421,335.35
179,356,725.60
65,586,938.07
Finance expenses
63,115,545.25
51,732,917.83
75,310,745.65
65,554,043.13
Loss on impairment of assets
28,630,947.43
26,459,732.07
-16,631,782.03
-9,045,702.36
Add:Gain on change in fair value (“-” denotes loss)
130,000.00
11,230,000.00
—
—
Investment income (“-” denotes loss)
-8,310,329.95
189,528,925.13
-4,366,800.87
18,217,978.31
Including: Investment income from associates
-8,410,715.79
-8,410,715.79
-4,366,800.87
-4,366,800.87
15and joint ventures
Foreign exchange gains (“-” denotes loss)
—
—
—
—
III. Operating profit (“-” denotes loss)
278,433,514.41
460,930,109.37
402,554,106.23
331,442,129.83
Add:Non-operating income
38,941,481.91
17,830,024.15
52,965,347.81
25,392,882.55
Less:Non-operating expenses
2,798,010.19
1,855,891.37
993,128.66
384,143.48
Including: Loss on disposal of non-current assets
2,018,551.34
1,412,237.62
939,391.66
354,725.48
IV. Total profit (“-” denotes total loss)
314,576,986.13
476,904,242.15
454,526,325.38
356,450,868.90
Less:Income tax expenses
62,134,495.70
48,107,616.55
108,471,443.85
90,445,157.53
V. Net profit (“-” denotes net loss)
252,442,490.43
428,796,625.60
346,054,881.53
266,005,711.37
Net profit attributable to equity holders of the Company
231,699,904.71
428,796,625.60
304,186,434.99
266,005,711.37
Minority interests
20,742,585.72
—
41,868,446.54
—
VI. Earnings per share:
(I) Basic earnings per share
0.12
0.21
0.14
0.12
(II) Diluted earnings per share
N/A
—
N/A
—
VII. Other comprehensive income
-22,991.41
—
-8,466.29
—
VIII. Total comprehensive income
252,419,499.02
428,796,625.60
346,046,415.24
266,005,711.37
Total comprehensive income attributable to equity holders of the Company
231,676,913.30
428,796,625.60
304,177,968.70
266,005,711.37
Total comprehensive income attributable to minority interests
20,742,585.72
—
41,868,446.54
0.00
4.3 Income statement for the period from the beginning of the year to the end of the reporting period
Prepared by: Shandong Chenming Paper Holdings Limited January to September 2010
Unit: RMB
Amounts for the current period
Amounts for the prior period
Items
Consolidated
Parent company
Consolidated
Parent company
I. Total operating revenue
12,519,891,756.01
10,927,142,027.44
10,795,602,483.46
9,737,647,002.35
Including:Operating revenue
12,519,891,756.01
10,927,142,027.44
10,795,602,483.46
9,737,647,002.35
Interest income
—
—
—
—
Earned premium
—
—
—
—
Handling charges and commission income
—
—
—
—
16II. Total operating costs
11,468,607,426.49
10,169,276,727.38
10,212,958,070.56
9,318,703,035.32
Including:Operating costs
9,923,520,620.42
9,300,013,302.72
8,884,372,450.49
8,579,453,945.77
Interest expenses
—
—
—
—
Handling charges and commission expenses
—
—
—
—
Surrenders
—
—
—
—
Net claims paid
—
—
—
—
Net change in insurance contract reserves
—
—
—
—
Policyholder dividend expenses
—
—
—
—
Expenses for reinsurance accepted
—
—
—
—
Business taxes and surcharges
15,563,122.29
2,235,915.36
11,483,327.57
350,527.08
Selling and distribution expenses
646,339,601.61
320,066,219.93
555,716,874.31
334,399,984.12
General and administrative expenses
644,901,446.37
321,848,082.91
515,256,080.13
180,055,944.12
Finance expenses
188,855,201.11
163,703,865.64
252,158,061.49
220,696,467.46
Loss on impairment of assets
49,427,434.69
61,409,340.82
-6,028,723.43
3,746,166.77
Add:Gain on change in fair value (“-” denotes loss)
8,488,094.03
15,100,000.00
8,985,659.76
-5,200,000.00
Investment income (“-” denotes loss)
-3,985,835.17
439,226,306.03
-13,898,520.99
54,625,576.72
Including: Investment income from associates and joint ventures
-4,086,221.01
-4,086,221.01
-13,898,520.99
-13,898,520.99
Foreign exchange gains (“-” denotes loss)
—
—
—
—
III. Operating profit (“-” denotes loss)
1,055,786,588.38
1,212,191,606.09
577,731,551.67
468,369,543.75
Add:Non-operating income
106,355,284.49
50,088,706.80
121,350,177.10
58,201,268.02
Less:Non-operating expenses
9,006,476.98
5,849,645.04
6,315,760.46
5,050,723.68
Including: Loss on disposal of non-current assets
5,149,136.56
3,316,386.29
5,592,541.55
4,803,999.87
IV. Total profit (“-” denotes total loss)
1,153,135,395.89
1,256,430,667.85
692,765,968.31
521,520,088.09
Less:Income tax expenses
204,613,818.00
144,439,629.04
160,596,260.16
140,164,176.63
V. Net profit (“-” denotes net loss)
948,521,577.89
1,111,991,038.81
532,169,708.15
381,355,911.46
Net profit attributable to equity holders of the Company
839,568,874.95
1,111,991,038.81
461,673,747.96
381,355,911.46
Minority interests
108,952,702.94
—
70,495,960.19
—
VI. Earnings per share:
(I) Basic earnings per share
0.41
0.54
0.22
0.18
(II) Diluted earnings per share
N/A
—
N/A
—
VII. Other comprehensive income
-147,058.73
—
-18,676.86
—
VIII. Total comprehensive income
948,374,519.16
1,111,991,038.81
532,151,031.29
381,355,911.46
Total comprehensive income attributable to equity holders of the Company
839,421,816.22
1,111,991,038.81
461,655,071.10
381,355,911.46 17Total comprehensive income attributable to minority interests
108,952,702.94
—
70,495,960.19
—
4.4 Cash flow statements for the period from the beginning of the year to the end of the reporting period
Prepared by: Shandong Chenming Paper Holdings Limited
January to September 2010
Unit: RMB
Amounts for the current period
Amounts for the prior period
Items
Consolidated
Parent company
Consolidated
Parent company
I.Cash flows from operating activities:
Cash received from sales of goods and rendering of services
11,145,975,371.06
8,767,983,457.44
9,552,751,851.75
8,009,085,467.39
Net increase in customer bank deposits and due to banks and other financial institutions
—
—
—
—
Net increase in borrowings from the central bank
—
—
—
—
Net increase in placements from other financial institutions
—
—
—
—
Cash received from premiums under original insurance contracts
—
—
—
—
Net cash received from reinsurance business
—
—
—
—
Net increase in deposits from policyholders
—
—
—
—
Net increase from disposal of held-for-trading financial assets
—
—
—
—
Cash received from interest, handling charges and commissions
—
—
—
—
Net increase in placements from banks and other financial institutions
—
—
—
—
Net capital increase of repurchase business
—
—
—
—
Tax rebates received
28,905,078.65
—
11,739,567.95
—
Cash received relating to other operating activities
246,712,641.49
53,297,994.69
183,248,812.32
108,594,971.12
Subtotal of cash inflows from operating activities
11,421,593,091.20
8,821,281,452.13
9,747,740,232.02
8,117,680,438.51
Cash paid for goods and
8,023,925,874.22
6,554,179,930.27
7,225,355,525.35
6,731,497,360.77
18services
Net increase in loans and advances to customers
—
—
—
—
Net increase in deposits with the central bank and other financial institutions
—
—
—
—
Cash paid for claims under original insurance contracts
—
—
—
—
Cash paid for interest, handling charges and commission
—
—
—
—
Cash paid for policyholder dividend
—
—
—
—
Cash paid to and for employees
618,691,882.22
213,708,684.24
395,165,388.12
143,456,246.63
Payments of taxes and surcharges
1,014,459,093.46
600,782,601.18
598,079,168.62
344,209,194.94
Cash paid relating to other operating activities
517,232,791.63
1,296,466,795.61
701,196,790.08
1,094,018,738.75
Subtotal of cash outflows from operating activities
10,174,309,641.53
8,665,138,011.30
8,919,796,872.17
8,313,181,541.09
Net cash flows from operating activities
1,247,283,449.67
156,143,440.83
827,943,359.85
-195,501,102.58
II.Cash flows from investing activities:
Cash received from investments
1,020,000.00
352,020,000.00
—
589,500,000.00
Cash received from investment income
—
475,992,163.36
—
86,524,097.71
Net cash received from disposal of fixed assets, intangible assets and other long-term assets
20,164,036.66
19,004,765.80
19,904,053.97
19,422,976.05
Net cash received from disposal of subsidiaries and other business units
—
—
—
—
Cash received relating to other investing activities
13,001,000.00
—
14,675,000.00
6,535,000.00
Subtotal of cash inflows from investing activities
34,185,036.66
847,016,929.16
34,579,053.97
701,982,073.76
Cash paid for purchase of fixed assets, intangible assets and other long-term assets
3,598,273,898.49
111,217,430.65
1,435,814,621.14
185,084,655.36
Cash paid on investments
1,010,000.00
2,251,000,000.00
6,000,000.00
426,000,000.00
Net increase in pledged loans
—
—
—
—
Net cash paid for acquisition of subsidiaries and other business units
—
—
9,265,761.72
—
Cash paid relating to other investing activities
—
—
—
—
Subtotal of cash outflows from investing activities
3,599,283,898.49
2,362,217,430.65
1,451,080,382.86
611,084,655.36
Net cash flows from
-3,565,098,861.83
-1,515,200,501.49
-1,416,501,328.89
90,897,418.40
19investing activities
III.Cash flows from financing activities:
Cash received from capital contribution
—
—
—
—
Including: cash received from minority interest contribution to subsidiaries
—
—
—
—
Cash received from borrowings
3,428,816,218.11
1,718,533,919.48
9,115,481,026.09
7,623,431,808.88
Cash received from bond issue
—
—
—
—
Cash received relating to other financing activities
4,796,892,009.11
4,738,673,645.04
—
—
Subtotal of cash inflows from financing activities
8,225,708,227.22
6,457,207,564.52
9,115,481,026.09
7,623,431,808.88
Cash repayments of amounts borrowed
5,805,887,581.27
5,107,736,193.29
6,246,160,098.12
5,161,079,356.26
Cash paid for dividend and profit distribution or interest payment
878,508,616.68
721,925,905.78
446,037,647.68
397,837,998.95
Including: dividend and profit paid to minority interests by subsidiaries
—
—
—
—
Cash paid relating to other financing activities
—
—
2,118,617,231.46
2,141,596,099.28
Subtotal of cash outflows from financing activities
6,684,396,197.95
5,829,662,099.07
8,810,814,977.26
7,700,513,454.49
Net cash flows from financing activities
1,541,312,029.27
627,545,465.45
304,666,048.83
-77,081,645.61
IV.Effect of foreign exchange rate changes on cash and cash equivalents
-11,435,599.15
-11,265,864.81
-5,751,589.73
-499,092.06
V.Net increase in cash and cash equivalents
-787,938,982.04
-742,777,460.02
-289,643,509.94
-182,184,421.85
Add: Balance of cash and cash equivalents as at the beginning of the period
2,367,334,202.50
1,586,045,998.83
2,687,579,159.85
2,080,005,634.40
VI.Balance of cash and cash equivalents as at the end of the period
1,579,395,220.46
843,268,538.81
2,397,935,649.91
1,897,821,212.55
4.5 Audit report
Audit opinion: unaudited
28 October 2010
20
