HAINAN PEARL RIVER HOLDINGS CO., LTD.
THE THIRD QUARTERLY REPORT 2011
(Un-audited)
October 2011
1
HAINAN PEARL RIVER HOLDINGS CO., LTD.
THE THIRD QUARTERLY REPORT 2011
§1 Important Notice
1.1 The Board of Directors, the Supervisory Committee, directors, supervisors and
other senior management personnel of Hainan Pearl River Holdings Co., Ltd.
(hereinafter referred to as the Company) hereby guarantee that this report carries no
false information, misleading statements or major omissions, and accept, individually
and collectively, the responsibility for the factuality, accuracy and completeness of the
information set forth herein.
1.2 The Financial Report in this quarterly report has not been audited by a CPA firm.
1.3 Mr. Zheng Qing (Chairman of the Board and GM of the Company), Mr. Chen
Binglian (Standing Vice GM and Financial Principal of the Company) and Mr. Yang
Daoliang (Vice GM and Manager of the Financial Department) hereby confirm that
the Financial Report enclosed in this quarterly report is factual and complete.
§2. Company Profile
2.1 Main accounting data and financial indicators
Unit: RMB Yuan
As at 30 Sept. 2011 As at 31 Dec. 2010 Increase/decrease (%)
Total assets (Yuan) 1,344,889,368.89 1,448,885,550.24 -7.18%
Owners’ equity attributable to 438,776,563.16 497,295,405.44 -11.77%
shareholders of the Company (Yuan)
Share capital (Share) 426,745,404.00 426,745,404.00 0.00%
Net assets per share attributable to
shareholders of the Company (Yuan 1.03 1.17 -11.97%
/share)
Increase/decrease Increase/decrease
Jul.-Sept. 2011 Jan.-Sept. 2011
year-on-year (%) year-on-year (%)
Total operating income (Yuan) 37,014,691.21 -26.52% 181,307,464.94 -69.50%
Net profit attributable to shareholders of -18,290,101.17 -61.74% -33,331,967.28 -184.16%
the Company (Yuan)
Net cash flows generated from operating - - -47,655,272.57 -173.87%
activities (Yuan)
Net cash flows per share generated from - - -0.11 -173.33%
operating activities (Yuan /share)
Basic EPS (Yuan /share) -0.04 -33.33% -0.08 -188.89%
Diluted EPS (Yuan /share) -0.04 -33.33% -0.08 -188.89%
Weighted average ROE (%) -3.95% -1.82% -7.12% -13.83%
Weighted average ROE after deducting -6.26% -3.51% -13.68% -18.08%
non-recurring gains and losses (%)
Items of non-recurring gains and losses
vApplicable ? Non-applicable
Unit: RMB Yuan
Items of non-recurring gains and losses Amount Notes (If applicable)
Return reduction and exemption of taxes by surpassing approval -15,679.21
or without official approval document or occasionally
Capital occupation fees received from non-financial enterprises 10,699,125.71
recorded into current gains and losses
Other non-operating incomes and expenses besides the above each 381,007.55
item mentioned
Other gain/loss items that satisfy the definition of non-recurring 20,989,105.78
gains and losses
Effect on minority interest -475,212.12
Effect on income tax -885,778.44
Gains and losses from consigned others to invest or manage the 0.00
assets
2
Total 30,692,569.27 -
2.2 Total number of shareholders at period-end and shareholding of top ten
shareholders holding tradable shares
Unit: share
Total number of shareholders at the period-end 45,734
Shareholding of top ten shareholders holding tradable shares
Number of tradable shares held at
Full name of shareholder Type of share
period-end
Beijing Wanfa Real Estate Development Co.,
112,479,478 RMB ordinary shares
Ltd.
Hu Jiexiong 3,000,000 RMB ordinary shares
Xia Caizhen 2,915,127 RMB ordinary shares
Chen Yunxuan 2,551,502 RMB ordinary shares
Qu Chen 2,213,400 Domestically listed foreign shares
Pan Zhihui 2,180,000 RMB ordinary shares
Zhang Xiaoxia 1,949,250 Domestically listed foreign shares
Zhou Miaoji 1,257,974 RMB ordinary shares
Hu Haiyang 1,216,925 RMB ordinary shares
Ou Lei 1,206,348 RMB ordinary shares
§3 Significant Events
3.1 Significant changes in main accounting statement items and financial indicators as
well as reasons for these changes
vApplicable ? Non-applicable
Unit: RMB Yuan
Increase/ decrease
Item Jan.-Sept. 2011 Jan.-Sept. 2010 Main reasons for the movement
(%)
Real estate sales income
Operating revenues 181,307,464.94 594,410,243.55 -69.50
decreased significantly.
Real estate sales income
Operating costs 116,053,134.54 400,622,277.11 -71.03
decreased significantly.
Business tax and Real estate sales income
19,919,004.71 69,081,371.81 -71.17
surtaxes decreased significantly.
Decrease of advertising
Selling expense 4,402,530.39 8,346,281.40 -47.25
expense, etc.
The consolidation scope
Administrative expanded and the labor and the
57,713,451.85 42,847,428.51 34.70
expense labor and depreciation costs
increased.
Debt investments into external
parties decreased and the
Financial expense 29,180,612.10 18,999,304.79 53.59
interest income decreased
accordingly.
The inventory falling price
provision of RMB 7.20 million
for the former Yanjiang Road
Asset impairment
1,841,485.18 -4,915,951.63 137.46 No. 1 project was reversed in
loss
the same period of last year
while there was no such a case
in the current period.
Gains from investment
Investment gains 20,303,937.79 -135,525.88 15081.59 cooperation projects with
external parties
Decrease of the real estate sales
income and profit of the
Income tax expense 6,016,502.51 13,811,737.36 -56.44 subsidiary Hubei Pearl River
Real Estate Development Co.,
Ltd.
3
Fair value changes of the
Other composite
-25,186,875.00 -165,436,444.67 84.78 Southwest Securities shares
income
held by the Company
Net cash flows from Real estate sales income
-47,655,272.57 64,510,672.38 -173.87
operating activities decreased.
Call-back of principals and
Net cash flows from
-21,309,942.92 -145,571,521.53 85.36 interest of the debt investments
investing activities
into external parties
Net cash flows from Cash paid for debt repayment
-16,797,909.82 -152,444,221.78 88.98
financing activities decreased.
Increase/ decrease
Item 30 Sept. 2011 31 Dec. 2010 Main reasons for the movement
(%)
Real estate sales income
Monetary funds 50,613,725.88 136,376,851.19 -62.89 decreased. The Company paid
for joint investment and repaid
some debts.
More input to the Xuexiang
Construction in
16,965,537.09 4,732,000.00 258.53 tourist attraction and hotel
process
project
-35.33 Payments for project
Accounts payable 24,307,951.61 37,588,815.47
construction
The recognized real estate
sales income of the subsidiary
Accounts received in
20,134,357.45 39,134,147.85 -48.55 Hubei Pearl River Real Estate
advance
Development Co., Ltd. was
transferred.
The subsidiary Hubei Pearl
Taxes and fares
7,821,588.30 30,809,972.66 -74.61 River Real Estate Development
payable
Co., Ltd. paid taxes.
Some long-term borrowings of
Non-current the Company and its subsidiary
liabilities due within 232,000,000.00 0.00 Sanya Wanjia Hotel
one year M anagement Co., Ltd. were to
become due within one year.
Some long-term borrowings of
the Company and its subsidiary
Long-term
93,000,000.00 325,000,000.00 -71.38 Sanya Wanjia Hotel
borrowings
Management Co., Ltd. were to
become due within one year.
3.2 Progress of significant events as well as their influence and solutions
3.2.1 Non-standard audit opinion
?Applicable vInapplicable
3.2.2 The Company provides funds for the controlling shareholder or its related
parties or provides external guarantees in violation of the prescribed procedure
?Applicable vInapplicable
3.2.3 Significant contracts signed and executed concerning routine operation
?Applicable vInapplicable
3.2.4 Others
?Applicable vInapplicable
3.3 Fulfillment of commitments made by the Company, shareholders and the actual
controller
Commitments made by the Company, its directors, supervisors, senior executives,
shareholders with an over 5% shareholding, actual controller and other stakeholders
during the reporting period, or such commitments carried down into the reporting
period:
?Applicable vInapplicable
3.4 Warnings of possible losses or major changes of the accumulative net profit
achieved during the period from year-begin to the end of the next reporting period
compared with the same period of last year, as well as explanation on reasons
4
?Applicable vInapplicable
3.5 Other significant events that need to be explained
3.5.1 Investments into securities
?Applicable vInapplicable
3.5.2 Reception of research, interviews and visits in the reporting period
No field researches, phone calls or written inquiries were received from investors in
the reporting period.
3.6 Derivative investments
?Applicable vInapplicable
3.6.1 Derivative investments held at the end of the reporting period
?Applicable vInapplicable
Chairman of the Board of Directors: Zheng Qing
HaiNan Pearl River Holdings Co., Ltd.
26 October 2011
§4 Attachments
4.1 Balance sheet
Prepared by Hainan Pearl River Holdings Co., Ltd. 30 Sept. 2011. Unit: RMB Yuan
Balance as at 30 Sept. 2011 Balance as at 31 Dec. 2010
Items
Consolidation The Company Consolidation The Company
Current assets:
Monetary funds 50,613,725.88 1,953,373.20 136,376,851.19 47,697,821.48
Settlement funds
Outgoing call loans
Transaction financial asset
Notes receivable
Account receivable 7,211,436.78 1,072,285.51 3,627,245.66 1,039,916.11
Prepayment 65,058,695.39 50,000,000.00 53,898,082.24 50,070,000.00
Insurance premium receivables
Reinsurance accounts
receivable
Reinsurance contract reserve
receivables
Interest receivable
Dividend receivable 260,015.00 260,015.00 260,015.00 260,015.00
Other accounts receivable 299,398,164.10 398,243,403.53 258,266,331.45 289,469,963.47
Financial assets purchased
under agreements to resell
Inventories 121,777,671.79 12,782,893.61 154,866,011.08 12,782,893.61
Non-current assets due within 1
year
Other current assets
Total current assets 544,319,708.94 464,311,970.85 607,294,536.62 401,320,609.67
Non-current assets:
5
Loan and payment on other’
behalf disbursed
Available for sale financial 353,115,000.00 353,115,000.00 386,697,500.00 386,697,500.00
assets
Held to maturity investments
Long-term account receivable
Long-term equity investment 50,990,471.60 301,388,841.31 51,675,639.59 296,974,009.30
Investment property 19,147,484.81 19,898,962.92
Fixed asset 317,376,197.87 19,653,538.78 334,512,524.54 21,376,736.10
Project in process 16,965,537.09 4,732,000.00
Engineering material 606,206.60 606,206.60
Fixed asset disposal
Production biological asset
Oil-gas assets
Intangible assets 32,691,263.15 1,612,620.15 33,492,984.34 1,648,367.88
Development expense
Goodwill
Long-term deferred expense 9,677,498.83 9,975,195.63
Deferred tax assets
Other non-current assets
Total non-current assets 800,569,659.95 675,770,000.24 841,591,013.62 706,696,613.28
Total assets 1,344,889,368.89 1,140,081,971.09 1,448,885,550.24 1,108,017,222.95
Current liabilities:
Short-term borrowings
Borrowing from central Bank
Deposits received and held for
others
Call loan received
Transaction financial liabilities
Notes payable
Account payable 24,307,951.61 2,482,949.70 37,588,815.47 3,782,949.70
Account received in advance 20,134,357.45 270,485.00 39,134,147.85
Financial assets sold under
agreements to repurchase
Handling charges and
commission payable
Payroll payable 5,108,113.79 408,100.86 5,631,750.04 492,944.38
Taxes payable 7,821,588.30 -2,392,636.09 30,809,972.66 -2,851,226.09
Interest payable 89,563,307.29 57,195,372.83 85,390,223.02 51,834,549.23
Dividend payable 3,213,302.88 3,213,302.88 3,213,302.88 3,213,302.88
Other payables 338,772,126.35 347,109,250.24 329,316,226.89 266,835,267.94
6
Account due to reinsurance
Insurance contract reserve
Entrusted trading of securities
Entrusted selling of securities
Non-current liabilities due 232,000,000.00 220,000,000.00
within 1 year
Other current liabilities
Total current liabilities 720,920,747.67 628,286,825.42 531,084,438.81 323,307,788.04
Non-current liabilities:
Long-term borrowings 93,000,000.00 325,000,000.00 220,000,000.00
Bonds payable
Long-term payables
Specific payables
Estimated liabilities
Deferred taxes liabilities 65,889,513.80 64,837,500.00 74,285,138.80 73,233,125.00
Other non-current liabilities
Total non-current liabilities 158,889,513.80 64,837,500.00 399,285,138.80 293,233,125.00
Total liabilities 879,810,261.47 693,124,325.42 930,369,577.61 616,540,913.04
Owner’ equity (or shareholders’
equity):
Paid-in capital (or share capital) 426,745,404.00 426,745,404.00 426,745,404.00 426,745,404.00
Capital reserve 580,077,280.97 583,093,620.51 605,264,155.97 608,280,495.51
Less: treasury stock
Specific reserves
Surplus reserves 114,177,485.88 109,487,064.39 114,177,485.88 109,487,064.39
General risk provision
Retained earnings -682,223,607.69 -672,368,443.23 -648,891,640.41 -653,036,653.99
Foreign exchange difference
Total equity attributable to owners 438,776,563.16 446,957,645.67 497,295,405.44 491,476,309.91
of the Company
Minority interest 26,302,544.26 21,220,567.19
Total owner’ equity 465,079,107.42 446,957,645.67 518,515,972.63 491,476,309.91
Total liabilities and owner’ 1,344,889,368.89 1,140,081,971.09 1,448,885,550.24 1,108,017,222.95
equity
4.2 Income statement for Jul.-Sept. 2011
Prepared by Hainan Pearl River Holdings Co., Ltd. Jul.-Sept. 2011 Unit: RMB Yuan
Jul.-Sept. 2011 Jul.-Sept. 2010
Items
Consolidation The Company Consolidation The Company
I. Total sales 37,014,691.21 126,370.00 50,373,671.40 66,970.00
Including: Sales 37,014,691.21 126,370.00 50,373,671.40 66,970.00
7
Interests income
Premium income
Handling charges and
commission income
II. Total cost of sales 76,229,393.26 27,757,834.28 60,088,289.17 5,559,167.49
Including: Cost of sales 29,535,808.25 13,289.25 33,955,465.78 13,289.25
Interests expenses
Handling charges and
commission income
Insurance discharge payment
Claim expenses-net
Provision for insurance contract
reserves-net
Insurance policy dividend paid
Reinsurance expense
Business taxes and surcharges 2,795,706.50 7,076.73 5,276,755.63 7,366.70
Distribution expenses 808,936.27 1,761,409.87
Administrative expenses 17,992,016.62 3,333,366.15 12,994,666.47 2,468,578.25
Financial costs 23,424,772.74 22,116,809.72 6,301,043.82 2,736,412.70
Assets impairment loss 1,672,152.88 2,287,292.43 -201,052.40 333,520.59
Add: gain/(loss) from change in
fair value (“-” means loss)
Investment gains (“-” means 20,708,753.71 20,708,753.71 -200,390.44 -200,390.44
loss)
Including: income from
investment on affiliated enterprise -280,352.07 -200,390.44
and jointly enterprise
Foreign exchange difference
(“-” means loss)
III. Operating profit (“-” means -18,505,948.34 -6,922,710.57 -9,915,008.21 -5,692,587.93
loss)
Add: non-business income 2,666.37 25,965.00
Less: non-business expense 53.51 51.43 60,000.00
Including: loss from non-current 0.00
asset disposal
IV. Total profit (“-” means loss) -18,503,335.48 -6,922,762.00 -9,949,043.21 -5,692,587.93
Less: tax expense 583,213.92 931,171.76
V. Net profit (“-”means loss) -19,086,549.40 -6,922,762.00 -10,880,214.97 -5,692,587.93
Attributable to equity holders of -18,290,101.17 -6,922,762.00 -11,308,336.38 -5,692,587.93
the Company
Minority interests -796,448.23 0.00 428,121.41
VI. Earnings per share
(I) Basic earnings per share -0.04 -0.03
(II) Diluted earnings per share -0.04 -0.03
Ⅶ. Other comprehensive income -31,171,875.00 -31,171,875.00 2,493,750.00 2,493,750.00
Ⅷ. Total comprehensive income -50,258,424.40 -38,094,637.00 -8,386,464.97 -3,198,837.93
8
Attributable to owners of the -49,461,976.17 -38,094,637.00 -8,814,586.38 -3,198,837.93
Company
Attributable to minority -796,448.23 428,121.41
shareholders
Where there were business combinations under the same control in this reporting
period, the combined parties achieved net profit of RMB 0.00 before the
combinations.
4.3 Income statement for Jan.-Sept. 2011
Prepared by Hainan Pearl River Holdings Co., Ltd. Jan.-Sept. 2011 Unit: RMB Yuan
Jan.-Sept. 2011 Jan.-Sept. 2010
Items
Consolidation The Company Consolidation The Company
I. Total sales 181,307,464.94 319,710.00 594,410,243.55 81,997,613.20
Including: Sales 181,307,464.94 319,710.00 594,410,243.55 81,997,613.20
Interests income
Premium income
Handling charges and
commission income
II. Total cost of sales 229,110,218.77 39,932,806.38 534,980,711.99 77,737,944.64
Including: Cost of sales 116,053,134.54 39,867.75 400,622,277.11 42,184,251.33
Interests expenses
Handling charges and
commission income
Insurance discharge payment
Claim expenses-net
Provision for insurance contract
reserves-net
Insurance policy dividend paid
Reinsurance expense
Business taxes and surcharges 19,919,004.71 53,627.58 69,081,371.81 20,132,259.90
Distribution expenses 4,402,530.39 15,000.00 8,346,281.40 24,477.00
Administrative expenses 57,713,451.85 12,114,180.85 42,847,428.51 11,191,400.04
Financial costs 29,180,612.10 25,882,894.77 18,999,304.79 9,158,514.18
Assets impairment loss 1,841,485.18 1,827,235.43 -4,915,951.63 -4,952,957.81
Add: gain/(loss) from change in
fair value (“-” means loss)
Investment gains (“-” means 20,303,937.79 20,303,937.79 -135,525.88 -135,525.88
loss)
Including: income from
investment on affiliated enterprise -685,167.99 -685,167.99 -135,525.88 -135,525.88
and jointly enterprise
Foreign exchange difference
(“-” means loss)
III. Operating profit (“-” means -27,498,816.04 -19,309,158.59 59,294,005.68 4,124,142.68
loss)
Add: non-business income 433,052.37 1,735,978.72 1,710,013.72
Less: non-business expense 67,724.03 22,630.65 173,530.62 14,023.12
9
Including: loss from non-current 15,679.21 12,915.00 32,373.03 14,023.12
asset disposal
IV. Total profit (“-” means loss) -27,133,487.70 -19,331,789.24 60,856,453.78 5,820,133.28
Less: tax expense 6,016,502.51 13,811,737.36
V. Net profit (“-” means loss) -33,149,990.21 -19,331,789.24 47,044,716.42 5,820,133.28
Attributable to equity holders of -33,331,967.28 -19,331,789.24 39,603,368.12 5,820,133.28
the Company
Minority interests 181,977.07 0.00 7,441,348.30
VI. Earnings per share
(I) Basic earnings per share -0.08 0.09
(II) Diluted earnings per share -0.08 0.09
Ⅶ. Other comprehensive income -25,186,875.00 -25,186,875.00 -165,436,440.67 -168,177,789.56
Ⅷ. Total comprehensive income -58,336,865.21 -44,518,664.24 -118,391,724.25 -162,357,656.28
Attributable to owners of the -58,518,842.28 -44,518,664.24 -125,833,072.55 -162,357,656.28
Company
Attributable to minority 181,977.07 7,441,348.30
shareholders
Where there were business combinations under the same control from the year-begin
to the period-end, the combined parties achieved net profit of RMB 0.00 before the
combinations.
4.4 Cash flow statement for Jan.-Sept. 2011
Prepared by Hainan Pearl River Holdings Co., Ltd. Jan.-Sept. 2011 Unit: RMB Yuan
Jan.-Sept. 2011 Jan.-Sept. 2010
Items
Consolidation The Company Consolidation The Company
1. Cash flows from operating
activities:
Cash received from sales of 153,174,156.59 707,165.00 311,056,465.19 63,062,832.61
goods or rendering of services
Net increase of deposits
received and held for others
Net increase of loans from
central bank
Net increase of call loans
from other financial institutions
Cash received against
original insurance contract
Net cash received from
reinsurance
Net increase of client deposit
and investment
Net increase of disposal of
held-for-trading financial assets
Cash received as interest,
handling charges and
commissions
Net increase of call loans
Net increase of cash received
under repurchasing
Tax and fare refunds
Other cash received from 14,429,673.44 4,002,780.17 63,644,782.99 42,065,771.68
operating activities
Sub-total of cash inflow from 167,603,830.03 4,709,945.17 374,701,248.18 105,128,604.29
operating activities
Cash paid for goods and 50,084,935.44 128,325,970.11 50,444,358.71
services
Net increase of loans and
10
advances from customers
Net increase of deposits in
central bank, banks and other
financial institutions
Cash paid for original
contract claims
Cash paid for interest, fees
and commissions
Cash paid for policy
dividend
Cash paid to and for 62,526,491.45 3,359,426.94 44,202,813.92 2,378,246.58
employees
Cash paid for various taxes 53,343,972.19 1,596,881.85 52,896,374.95 21,293,555.78
and fares
Other cash paid relating to 49,303,703.52 11,157,540.09 84,765,416.82 22,480,311.72
operating activities
Sub-total of cash outflows 215,259,102.60 16,113,848.88 310,190,575.80 96,596,472.79
from operating activities
Net cash flows from -47,655,272.57 -11,403,903.71 64,510,672.38 8,532,131.50
operating activities
II. Cash flows from investing
activities
Cash received from 284,700,000.00 201,700,000.00 35,000,000.00 35,000,000.00
investment retractions
Cash received from
investment income
Net cash received from
disposal of fixed assets, intangible 164,708.50 6,000.00 3,700,173.00 3,628,173.00
assets and other long-term assets
Net cash received from
disposal of subsidiaries and other
operating units
Other cash received relating 36,611,451.04 27,721,904.43
to investing activities
Sub-total of cash inflows of 321,476,159.54 229,427,904.43 38,700,173.00 38,628,173.00
investing activities
Cash paid for acquisition of
fixed assets, intangible assets and 20,226,102.46 1,368,449.00 16,269,801.23 2,230,047.70
other long-term assets
Cash paid for acquisition of 322,560,000.00 311,600,000.00 152,600,000.00 195,600,000.00
investments
Net increase of pledge loans
Net cash paid for acquisition
of subsidiaries and other operating
units
Other cash paid relating to 15,401,893.30
investing activities
Sub-total of cash outflows of 342,786,102.46 312,968,449.00 184,271,694.53 197,830,047.70
investing activities
Net cash flows from -21,309,942.92 -83,540,544.57 -145,571,521.53 -159,201,874.70
investing activities
III. Cash flows from financing
activities:
Cash received from 4,900,000.00
absorbing investment
Including: cash received by
subsidiaries from minority 4,900,000.00
shareholders
Cash received from 40,216,000.00 79,000,000.00 222,000,000.00 270,000,000.00
borrowings
Cash received from bonds
issuing
Other cash received relating 9,298.18
to financing activities
Sub-total of cash inflows of 45,125,298.18 79,000,000.00 222,000,000.00 270,000,000.00
11
financing activities
Cash paid for repayment of 25,890,930.00 790,930.00 360,980,110.00 276,000,000.00
borrowings
Cash paid for dividends, 36,032,278.00 29,009,070.00 13,464,111.78 1,198,422.75
profit distribution or interest
Including: dividends or
profits paid to minority
shareholders by subsidiaries
Other cash paid relating to
financing activities
Sub-total of cash outflows 61,923,208.00 29,800,000.00 374,444,221.78 277,198,422.75
of financing activities
Net cash flows from -16,797,909.82 49,200,000.00 -152,444,221.78 -7,198,422.75
financing activities
IV. Effect of foreign exchange
rate on cash and cash equivalents
V. Net decrease in cash and cash -85,763,125.31 -45,744,448.28 -233,505,070.93 -157,868,165.95
equivalents
Add : Opening amount of 136,376,851.19 47,697,821.48 291,787,132.78 161,760,970.47
cash and cash equivalents
VI. Closing balance of cash and 50,613,725.88 1,953,373.20 58,282,061.85 3,892,804.52
cash equivalents
4.5 Auditor’ report
Audit opinion: Un-audited
12
