2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
HUBEI SANONDA CO., LTD.
2014 Semi-annual Report
July 2014
1
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Section I. Important Reminders, Contents & Explanation
The Board of Directors, the Supervisory Committee as well as all directors, supervisors and senior
management staff of Hubei Sanonda Co., Ltd. (hereinafter referred to as “the Company”) warrant
that this report is factual, accurate and complete without any false record, misleading statement or
material omission. And they shall be jointly and severally liable for that.
All directors attended the board session for reviewing this report.
The Company plans not to distribute cash dividends or bonus shares or turn capital reserve into
share capital.
Mr. Li Zuorong, company principal, and Mr. He Xuesong, chief of the accounting work and chief of
the accounting organ (chief of accounting), hereby confirm that the Financial Report enclosed in
this report is factual, accurate and complete.
This report is prepared in both Chinese and English. Should there be any discrepancy between the
two versions, the Chinese version shall prevail.
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Contents
2014 Semi-annual Report .................................................................................................................. 1
Section I. Important Reminders, Contents & Explanation............................................................ 2
Section II. Company Profile .............................................................................................................. 5
Section III. Highlights of Accounting Data & Financial Indicators .............................................. 7
Section IV. Report of the Board of Directors ................................................................................... 9
Section V. Significant Events ........................................................................................................... 17
Section VI. Change in Shares & Shareholders .............................................................................. 29
Section VII. Preferred Shares ......................................................................................................... 34
Section VIII. Directors, Supervisors & Senior Management Staff .............................................. 35
Section IX. Financial Report ........................................................................................................... 35
Section X. Documents Available for Reference ........................................................................... 143
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Explanation
Refers
Term Contents
to
Company/the Company Refers Hubei Sanonda Co., Ltd.
to
Refers
CSRC Hubei The Hubei bureau of China Securities Regulatory Commission
to
Refers
CSRC China Securities Regulatory Commission
to
Refers
SSE Shenzhen Stock Exchange
to
Refers
Reporting period/the reporting period 1 Jan. 2014-30 Jun. 2014
to
Refers The Company’s controlling shareholder, formerly known as “Sanonda
Jingzhou Sanonda Holdings Co., Ltd.
to Group Co., Ltd.”
Refers ADAMA Agricultural Solutions LTD., formerly known as
ADAMA
to “Makhteshim-Agan Industries Ltd.”—a subsidiary controlled by CNAC
Refers China National Agrochemical Corporation (holding 100% equity of
CNAC to Jingzhou Sanonda Holdings Co., Ltd. , the Company’s controlling
shareholder)
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Section II. Company Profile
I. Basic information of the Company
Stock abbreviation SLDA (SLDB) Stock code 000553（200553）
Stock exchange listed with Shenzhen Stock Exchange
Chinese name of the Company 湖北沙隆达股份有限公司
Abbr. of the Chinese name of
沙隆达
the Company (if any)
English name of the Company
HUBEI SANONDA CO., LTD
(if any)
Abbr. of the English name of
Sanonda
the Company (if any)
Legal representative of the
Li Zuorong
Company
II. Contact information
Company Secretary Securities Affairs Representative
Name Li Zhongxi Liang Jiqin
No. 93, Beijing East Road, Jingzhou, No. 93, Beijing East Road, Jingzhou,
Contact address
Hubei Hubei
Tel. 0716-8208632 0716-8208232
Fax 0716-8321099 0716-8321099
E-mail lizhongxi@agr.chemchina.com liangjiqin@agr.chemchina.com
III. Other information
1. Ways to contact the Company
Did any change occur to the registered address, office address and their postal codes, website address and email address of the
Company during the reporting period?
□ Applicable √ Inapplicable
The registered address, office address and their postal codes, website address and email address of the Company did not change
during the reporting period. The said information can be found in the 2013 Annual Report.
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
2. About information disclosure and where this report is placed
Did any change occur to information disclosure media and where this report is placed during the reporting period?
□ Applicable √ Inapplicable
The newspapers designated by the Company for information disclosure, the website designated by CSRC for disclosing this report
and the location where this report is placed did not change during the reporting period. The said information can be found in the 2013
Annual Report.
3. Change of the registered information
Did any change occur to the registered information during the reporting period?
□ Applicable √ Inapplicable
The registration date and place of the Company, its business license No., taxation registration No. and organizational code did not
change during the reporting period. The said information can be found in the 2013 Annual Report.
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Section III. Highlights of Accounting Data & Financial Indicators
I. Major accounting data and financial indicators
Does the Company adjust retrospectively or restate accounting data of previous years due to change of the accounting policy or
correction of any accounting error?
□ Yes √ No
Reporting period Same period of last year YoY +/- (%)
Operating revenues (RMB Yuan) 1,700,281,424.68 1,519,688,317.22 11.88%
Net profit attributable to shareholders of
288,406,597.13 127,470,524.25 126.25%
the Company (RMB Yuan)
Net profit attributable to shareholders of
the Company after extraordinary gains and 287,537,764.46 128,673,087.74 123.46%
losses (RMB Yuan)
Net cash flows from operating activities
374,110,765.75 422,153,123.84 -11.38%
(RMB Yuan)
Basic EPS (RMB Yuan/share) 0.4856 0.2146 126.28%
Diluted EPS (RMB Yuan/share) 0.4856 0.2146 126.28%
Weighted average ROE (%) 17.15% 9.66% 7.49%
As at the end of the
As at the end of last year YoY +/- (%)
reporting period
Total assets (RMB Yuan) 3,147,793,687.52 2,708,271,174.34 16.23%
Net assets attributable to shareholders of
1,809,332,795.25 1,546,189,571.66 17.02%
the Company (RMB Yuan)
II. Differences between accounting data under domestic and overseas accounting standards
1. Differences of net profit and net assets disclosed in financial reports prepared under international and
Chinese accounting standards
□ Applicable √ Inapplicable
No difference.
2. Differences of net profit and net assets disclosed in financial reports prepared under overseas and
Chinese accounting standards
□ Applicable √ Inapplicable
No difference.
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
III. Items and amounts of extraordinary gains and losses
√Applicable □ Inapplicable
Unit: RMB Yuan
Item Amount Explanation
Gains/losses on the disposal of non-current assets (including the
12,201.92
offset part of asset impairment provisions)
Government grants recognized in the current period, except for
those acquired in the ordinary course of business or granted at
1,367,962.96
certain quotas or amounts according to the country’s unified
standards
Other non-operating income and expenses other than the above -210,649.48
Less: Income tax effects 301,132.73
Minority interests effects (after tax) -450.00
Total 868,832.67 --
Explain the reasons if the Company classifies an item as an extraordinary gain/loss according to the definition in the Explanatory
Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Extraordinary Gains and
Losses, or classifies any extraordinary gain/loss item mentioned in the said explanatory announcement as a recurrent gain/loss item
□ Applicable √ Inapplicable
No such cases.
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Section IV. Report of the Board of Directors
I. Overview
In face of the complicated economic environment at home and abroad during the reporting period, we expanded
our sales by seizing opportunities arising from the periodic recovery of the pesticide market since 2013 and the
output decrease of some pesticides due to the country’s enhanced environmental protection. As a result, our export
grew considerably, main products were sold well and production devices kept running at high capacity. We knew
better what the market needed and increased prices of our leading products in appropriate timing, the procurement
prices of raw materials were stable, and the gross profit rate went up in a distinct manner. Meanwhile, we
enhanced production management, production devices worked stably, and the efforts in targeted energy saving
and consumption reduction produced a good result. We also continued to push forward system construction, with
safety and environmental protection improved. We were strict with budgetary management, with various
expenditures under effective control. Projects were accelerated, with the ion-exchange membrane caustic soda
project proceeding in an orderly manner. Starting from this May, affected by factors such as production capacity
and market demand, the market situation deteriorated. Several herbicides rapidly dropped in sales, glyphosate
(one of our main products) continued to see a weak market with low market prices, and selling prices were close
to production costs. The paraquate price also dropped with a smaller profit. And the output of some other products
had to be brought down. However, our leading products such as orthene and spermine remained strong. Therefore,
our overall production and operation was sound in the first half of 2014, with the best main economic indicators in
the history.
For the reporting period, we achieved operating revenues of RMB 1.7 billion, up 11.88% from the same period of
last year; earned USD 175 million through export, up 36.45% year on year; made total profits of RMB 393
million, up 130.42% year on year; and achieved a gross profit rate of 30.83%, up by 10.77 percentage points from
a year earlier. This is mainly because: firstly, we took opportunities to expand sales, maintained a fast growth in
export, understood better what the market needed, and increased the selling prices of our leading products in
appropriate timing, which resulted in better profitability; secondly, we enhanced procurement management and
kept the procurement prices of raw materials under control and stable, enhanced production management and
achieved a good result in targeted energy saving and consumption reduction, and steadily pushed forward the
heat-electricity co-generation project and kept a good self-supporting capability, which brought down the
operating costs by 2.39% from the same period of last year; and finally, we enhanced budgetary management and
cost control and the period charges went down by 15.9% from a year earlier, of which the financial expenses
decreased 57.1% year on year.
II. Main business analysis
YoY change of major financial data:
Unit: RMB Yuan
Reporting period Same period of last year YoY +/-% Main reasons for change
Both the sales volume
Operating revenues 1,700,281,424.68 1,519,688,317.22 11.88%
and the selling prices in
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
export increased.
Operating costs 1,176,489,773.88 1,210,871,838.98 -2.84% Product costs decreased.
Freight charges
Selling expenses 43,196,541.82 45,575,412.03 -5.22%
decreased.
Administrative expenses 56,494,485.42 46,726,703.36 20.90% The labor cost increased.
Short-term loans
decreased and the interest
Financial expenses 17,251,932.88 40,211,554.98 -57.10%
expenses decreased
accordingly.
Income tax expenses 104,989,467.59 43,970,999.05 138.77% Total profits increased.
The revenues increased
Net cash flows from and the accounts
374,110,765.75 422,153,123.84 -11.38%
operating activities receivable increased
accordingly.
Net cash flows from Project investments
-239,346,526.88 -62,633,549.10 -282.14%
investing activities increased.
Net cash flows from Loan repayments
-89,472,142.62 16,044,392.26 -657.65%
financing activities increased.
Net cash outflows from
Net increase in cash and operating, investing and
45,842,050.84 374,541,119.91 -87.76%
cash equivalents financing activities all
decreased.
Major changes to the profit structure or sources of the Company during the reporting period:
□ Applicable √ Inapplicable
No major changes occurred to the profit structure or sources of the Company during the reporting period.
Reporting period progress of the future development planning in the disclosed documents of the Company such as share-soliciting
prospectuses, offering prospectuses, asset reorganization reports, etc.:
□ Applicable √ Inapplicable
The Company did not mention any future planning for the reporting period in its disclosed documents such as share-soliciting
prospectuses, offering prospectuses, asset reorganization reports, etc.
Review the progress of the previously disclosed business plan in the reporting period:
As disclosed in the 2013 Annual Report, the Company planned to achieve sales revenues of RMB 3.1 billion for 2014. In the first
half of 2014, the Company achieved operating revenues of RMB 1.7 billion, accomplishing 54.83% of the annual target. In the
coming six months, the Company will try its best to organize production carefully to ensure all production devices operate safely and
stably and the sales demand is fully satisfied. It will keep improving management to increase the operation quality. It will also pay
close attention to the market, enhance marketing innovation, solve sales bottlenecks and improve sales management. At the same
time, it will carry forward technical innovation and accelerate projects to reach production objectives so that the annual production
and operation plan can be accomplished.
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
III. Breakdown of main business
Unit: RMB Yuan
Increase/decrease Increase/decrease Increase/decrease
of operating of operating costs of gross profit
Operating Gross profit rate
Operating costs revenues over the over the same rate over the same
revenues (%)
same period of period of last year period of last year
last year (%) (%) (%)
Classified by industry:
Industry of
manufacturing
chemical raw
1,684,628,595.44 1,165,187,638.55 30.83% 11.84% -3.24% 10.77%
materials and
chemical
products
Classified by product:
Agriculture-appli
ed chemicals,
1,752,641,917.67 1,252,800,229.58 28.52% 12.53% -1.18% 9.92%
such as fertilizer
and pesticide
New chemical
materials and 8,571,350.43 5,424,644.20 36.71% 2.48% 14.89% -6.84%
special chemicals
Petroleum
chemical and -100.00% -100.00%
refining products
Basic
(chlor-alkali)
47,776,370.13 31,323,807.56 34.44% 492.21% 333.38% 24.03%
chemical
products
Internal offset
-124,361,042.79 -124,361,042.79
amount
Classified by region:
Domestic 761,969,864.68 555,479,845.28 27.10% -10.48% -18.05% 6.73%
Overseas 1,047,019,773.55 734,068,836.06 29.89% 33.67% 12.16% 13.45%
Internal offset
-124,361,042.79 -124,361,042.79
amount
IV. Core competitiveness analysis
In the reporting period, the Company gradually grasped the pricing power of spermine and orthene in domestic
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
and foreign markets, adjusted to the market and positively increase the sales price, which led the series of the
technology reformation of these two production lines been well presented in recent years. At the same time, the
Company newly won two invention patent authorizations during the reporting period.
V. Investment analysis
1. Investments in equities of external parties
(1) Foreign investment
□ Applicable √ Inapplicable
There was no foreign investment of the Company in the reporting period.
(2) Equity-holdings in financial enterprises
√Applicable □ Inapplicable
Gain/loss
Initial Opening Closing Closing in the
Opening Closing
Enterprise Enterprise investment equity-hol equity-hol book value reporting Accountin Equity
equity-hol equity-hol
name variety cost (RMB dings dings (RMB period g title source
ding ratio ding ratio
Yuan) (share) (share) Yuan) (RMB
Yuan)
Purchase
Long-term
Hubei Commerci 20,000,000 8,008,982. of
23,481,067 0.71% 23,481,067 0.71% 0.00 equity
Bank al bank .00 63 corporate
investment
stock
8,008,982.
Total 23,481,067 -- 23,481,067 -- 0.00 -- --
63
(3) Investment in securities
□ Applicable √ Inapplicable
There was no investment in securities of the Company in the reporting period.
2. Information of trust management, derivative investment and entrusted loan
(1) Trust management
□ Applicable √ Inapplicable
There was no trust management of the Company in the reporting period.
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
(2) Derivative investment
□ Applicable √ Inapplicable
There was no derivative investment of the Company in the reporting period.
(3) Entrusted loan
□ Applicable √ Inapplicable
There was no entrusted loan of the Company in the reporting period.
3. Analysis to main subsidiaries and stock-participating companies
√ Applicable □ Inapplicable
Main subsidiaries and stock-participating companies:
Unit: RMB Yuan
Main
Company Company Registered Operating Operating
Industry products/ser Total assets Net assets Net profit
name variety capital revenues profit
vices
Chemical
Sanonda raw Production
(Jingzhou) material of
Pesticides and pesticides 30000000.0 3,533,993.2 -943,211.
Subsidiary -823,611.11 21,245.30 -948,226.65
and chemical and 0 1 13
Chemicals product intermediat
Co., Ltd. manufacturi es
ng industry
Import &
Hubei
export of
Sanonda
Trade pesticides 10000000.0 462,853,99 24,725,230. 141,510,41 -1,346,76
Foreign Subsidiary -2,992,172.31
industry and 0 1.76 55 3.01 4.50
Trading
intermediat
Co., Ltd.
es
Chemical
raw
Production
Jingzhou material
and sale of
Hongxiang and 40000000.0 184,151,04 4,020,164.9 13,254,225. -12,773,7 -12,803,793.9
Subsidiary chemical
Chemical chemical 0 4.29 0 43 93.96 6
raw
Co., Ltd. product
materials
manufacturi
ng industry
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
4. Significant projects of investments with non-raised funds
√ Applicable □ Inapplicable
Unit: RMB Ten Thousand Yuan
Cumulative actual
Project name Total investment Input for this period input as at the Project progress Project earnings
period-end
300,000 tons/year
(200,000 tons/year
per period)
34.27% of financial
reformation project
progress
of the energy saving 62,162 6,880 21,304 Unfinished
(82% of visual
and emission
progress)
reduction technology
of caustic soda
devices
Total 62,162 6,880 21,304 -- --
Query date of the assigned website of the
disclosure of the temporary announcement 28 May 2013
(if any)
www.cninfo.com.cn, with the name of the announcement is Announcement on the
Query index of the assigned website of the
Investment and construction of the 300,000 tons/year (200,000 tons/year per period)
disclosure of the temporary announcement
Reformation Project of the Energy Saving and Emission Reduction Technology of the
(if any)
Caustic Soda Devices and the announcement No.: 2013-24
VI. Predict the operating results of Jan.-Sep. 2014
Warning of possible loss or considerable YoY change of the accumulated net profit made during the period-begin
to the end of the next reporting period according to prediction, as well as explanations on the reasons:
□ Applicable √ Inapplicable
VII. Explanation by the Board of Directors and the Supervisory Committee about the
“non-standard audit report” issued by the CPAs firm for the reporting period
□ Applicable √ Inapplicable
VIII. Explanation by the Board of Directors about the relevent situation of the “non-standard
audit report” of the first half year
□ Applicable √ Inapplicable
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
IX. Implementation of profit allocation during the reporting period
Profit allocation plan implemented during the reporting period, especially execution and adjustment of the cash dividend plan and the
plan for turning capital reserve into share capital:
√ Applicable □ Inapplicable
On 4 Mar. 2014, the 6th Board of Directors of the 27th Meeting reviewed and approved the Preplan of the 2013
Profits Allocation of the Company, and the proposal had reviewed and approved by the 2013 Annual Shareholders
Meeting of the Company on 28 Mar. 2014. The Proposal of the 2013 Profit Allocation was: based on the total
shares of the Company as at 31 Dec. 2013, the Company distributed a cash dividend of RMB 0.5 (tax included)
for every 10 shares held by its shareholders; and there was no turning of capital reserve into share capital. On 15
Apr. 2014, the Implementation Announcement of the Equity Allocation of Y2013 was disclosed on the appointed
information disclosure media and the above cash dividend was finished on 24 Apr.
Special explanation of the cash dividend policy
Whether conformed with the regulations of the Articles of
association or the requirements of the resolutions of the Yes
shareholders’ meeting:
Yes. Article 155 in the Articles of Association of the Company
Whether the dividend standard and the proportion were definite stipulates the profit distribution policy, decision-making policy,
and clear: the condition of the dividend and the proportion of the Company
etc.
Whether the relevant decision-making process and the system
Yes
were complete:
Whether the independent director acted dutifully and exerted the
Yes
proper function:
Whether the medium and small shareholders had the chances to
fully express their suggestions and appeals, of which their legal Yes
interest had gained fully protection:
Whether the conditions and the process met the regulations and
was transparent of the adjustment or altered of the cash dividend Inapplicable
policy:
X. Preplan for profit distribution and turning capital reserve into share capital in the
reporting period
□ Applicable √ Inapplicable
The Company planed that no to distribute cash dividend, bonus shares and there was no turning of capital reserve into share capital.
XI. Particulars about researches, visits and interviews received in this reporting period
√ Applicable □ Inapplicable
Main discussion and
Time of reception Place of reception Way of reception Visitor type Visitor
materials provided by the
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Company
Production and operation of
13 Mar. 2014 Company Other Individual Individual investor the Company of the first
quarter.
The proposal reviewed by
the 2013 Annual
Shareholders Meeting. The
28 Mar. 2014 Company Other Individual Individual investor
materials provided: the
periodic report public
disclosed by the Company.
The influence on the
Company of the paraquat
Telephone
22 Apr. 2014 Company Individual Individual investor aqueous solution which was
Communication
abandoned production on 1
Jul. 2014.
Telephone Production and operation of
10 Jun. 2014 Company Individual Individual investor
Communication the Company.
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
V. Significant Events
I. Corporate governance
The situation of the Company’s governance did not differ in principle from the Company Law and the relevant CSRC requirements
in the reporting period.
II. Significant Litigations and Arbitrations
□ Applicable √ Inapplicable
The Company was not involved in any significant lawsuit or arbitration in the reporting period.
III. Media query
□Applicable √Inapplicable
The Company was not involved in any media query in the reporting period.
IV. Bankruptcy or Reorganization Events
□ Applicable √ Inapplicable
There Company was not involved in any bankruptcy or reorganization events in the reporting period.
V. Transaction in Assets
1. Purchase of assets
□ Applicable √ Inapplicable
There is no purchase of assets in the Company during the reporting period
2. Sale of assets
□ Applicable √ Inapplicable
There is no sale of assets in the Company during the reporting period.
3. Business combination
□ Applicable √ Inapplicable
There is no business combination in the Company during the reporting period.
VI. Implementation and Influence of Equity Incentive Plan of the Company
□ Applicable √ Inapplicable
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
There is no equity incentive plan and its implementation in the Company during the reporting period.
VII. Significant related-party transactions
1. Related-party transactions concerning routine operation
√ Applicable □ Inapplicable
Pricing Settlemen
Type of Contents Transacti
principle Proportio t method
the of the on
Related of the n in same of the
Relations related-pa related-pa Transacti amount Market Date of Index of
transactio related-pa kind of related-pa
hip rty rty on price （ten price disclosure disclosure
n party rty transactio rty
transactio transactio thousand
transactio ns (%) transactio
n n Yuan）
n n
www.cninfo.
com.cn, with
the name of
the
Bluestar announceme
nt:
Environm Under Announceme
Engineeri Cash
ental the same Market 13 Jun. nt about the
Purchase ng 8.04 0.01% remittanc estimation of
Engineeri ultimate price 2014 the 2014
materials e
ng Co., controller Routine
Related
Ltd. Transactions
and the No.
of the
announceme
nt: 2014-20
Bluestar
(Beijing) Under
Engineeri Cash
Chemical the same Market 13 Jun.
Purchase ng 158.21 0.13% remittanc Ditto
Machiner ultimate price 2014
materials e
y Co., controller
Ltd.
Sichuan
Under
Bluestar Cash
the same Raw Market 13 Jun.
Machiner Purchase 17.95 0.02% remittanc Ditto
ultimate materials price 2014
y Co., e
controller
Ltd.
Associate
Jingzhou d
Cash
Huaxiang enterprise Raw Market 13 Jun.
Purchase 35.12 0.03% remittanc Ditto
Chemical s of materials price 2014
e
Co., Ltd. parent
company
18
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Jingzhou
Sanonda Cash
Parent Market 13 Jun.
Sharehold Purchase Wrappage 100.44 0.09% remittanc Ditto
company price 2014
ing Co., e
Ltd.
ADAMA
Under
Agricultu Cash
the same Sales of Market 13 Jun.
ral Sale 1,685 0.99% remittanc Ditto
ultimate pesticides price 2014
Solutions e
controller
LTD.,
Jiamusi
Under
Heilong Cash
the same Sales of Market 13 Jun.
Agroche Sale 181.79 0.11% remittanc Ditto
ultimate pesticides price 2014
micals e
controller
Co., Ltd.
Jiangsu
Under
Anpon Cash
the same Sales of Market 13 Jun.
Electroch Sale 311.95 0.18% remittanc Ditto
ultimate pesticides price 2014
emical e
controller
Co., Ltd.
Associate
Jingzhou d
Cash
Huaxiang enterprise Chemical Market 13 Jun.
Sale 197.48 0.12% remittanc Ditto
Chemical s of products price 2014
e
Co., Ltd. parent
company
Shangdon
g Under
Cash
Dacheng the same Sales of Market 13 Jun.
Sale 1,347.57 0.79% remittanc Ditto
Agroche ultimate pesticides price 2014
e
mical controller
Co., Ltd.
Total -- -- 4,043.55 -- -- -- -- --
Details about return of large-amount sales
Where the Company classifies and
Daily management transactions this year is expected to 61 million Yuan; 40.4355
estimates the total amount of routine
related-party transactions for the reporting million Yuan is the actual prediction which is 66.29% of the year‘s prediction during the
period, explain the actual implementation
reporting period.
during the reporting period (if any)
The company’s related transactions with related party shall be carried out in accordance
Explain why the transaction price is greatly
different from the market price (if with the principle of voluntary, equality and mutual benefit, fair, and will not harm the
applicable)
interests of the company.
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
2. Related-party transactions arising from asset acquisition or sale
□ Applicable √ Inapplicable
The Company was not involved in any related-party transactions arising from asset acquisition or sale during the reporting period.
3. Related-party transitions with joint investments
□ Applicable √ Inapplicable
The Company was not involved in any related-party transaction with joint investments during the reporting period.
4. Credits and liabilities with related parties
√ Applicable □ Inapplicable
Was there any non-operating credit or liability with any related party?
□ Yes √ No
The Company was not involved in any credits and liabilities with related parties during the reporting period.
5. Other significant related-party transactions
√ Applicable □ Inapplicable
Pricing 2014 2013
Type
Content of the principle of
of
Name of the company related-party the Proportion
transact Amount Amount Proportion (%)
transaction related-party (%)
ion
transaction
Jingzhou Sanonda Guaran Guarantee fee Negotiated 1,570,000.00 100 2,880,000.00 32.43
Holdings Co., Ltd. tee price
China National Chemical Guaran Guarantee fee Negotiated 6,000,000.00 67.57
Agrochemical tee price
Corporation
Related transaction Related Type of Content of Pricing Amount of the related Proportion of Settlement modes
parties relations related related principle of transaction (RMB Ten amount of of the related
hip transatio transaction the related Thousand Yuan) the similar transaction
n transaction transaction
Bluestar (Beijing) Under Equipment Market price 1,907.69 1.62% Cash remiitance
Chemical Machinery the same
Co., Ltd. ultimate Purchase
controlle
r
Haohua Engineering Under Equipment and Market price 2,014.75 1.71% Cash remiitance
Purchase
Co., Ltd. the same labor
20
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
ultimate
controlle
r
Total 3922.44
The website to disclose the interim announcements on significant related-party transactions
Disclosure date of the interim
Name of the interim announcement Website to disclose the interim announcement
announcement
Related transaction announcement of
insurance pay to the controlling shareholder 22 Apr. 2014 www.cninfo.com.cn
and related parties
Related transaction announcement of signing
the EPC General Contracting Engineering 20 Jul. 2013 www.cninfo.com.cn
Contract with the related party
VIII. Particulars about the non-operating occupation of funds by the controlling shareholder
and other related parties of the Company
□ Applicable √ Inapplicable
The Company was not involved in the non-operating occupation of funds by the controlling shareholder and other related parties
during the reporting period.
IX. Particulars about significant contracts and their fulfillment
1. Particulars about trusteeship, contract and lease
(1) Trusteeship
□ Applicable √ Inapplicable
There was no any trusteeship of the Company in the reporting period.
(2) Contract
□ Applicable √ Inapplicable
There was no any contract of the Company in the reporting period.
(3) Lease
√ Applicable □ Inapplicable
Explanation on the lease
The 7th floor of the Company’s office building had rented to the controlling shareholder Jingzhou Sanonda Shareholder Co., Ltd. for
business operation in the reporting period with the annual rent of RMB 120,000.
21
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
The lease whose profits reaching more than 10% of the total profits of the Company in the reporting period
□ Applicable √ Inapplicable
There was no any lease whose profits reaching more than 10% of the total profits of the Company in the reporting period.
2. Guarantees provided by the company
√ Applicable □ Inapplicable
Unit: RMB Ten Thousand Yuan
Guarantees provided by the company for external parties (excluding those for subsidiaries)
Disclosure
date on Guarante
Actual
relevant Actual e for a
Amount for occurrence date Type of Period of Executed
Guaranteed party announcem guarantee related
guarantee (date of guarantee guarantee or not
ent of amount party or
agreement)
guaranteed not
amount
Guarantees provided by the company for its subsidiaries
Disclosure
date on Guarante
Actual
relevant Actual e for a
Amount for occurrence date Type of Period of Executed
Guaranteed party announcem guarantee related
guarantee (date of guarantee guarantee or not
ent of amount party or
agreement)
guaranteed not
amount
Hubei Sanonda
Joint liability
Foreign Trading Co., 6 Mar. 2014 34,900 5 Mar. 2014 32,900 1 year No Yes
guarantee
Ltd.
Total guarantee line approved for Total actual occurred amount
the subsidiaries during the of guarantee for the
34,900 32,900
reporting period subsidiaries during the
(B1) reporting period (B2)
Total guarantee line that has been
Total actual guarantee balance
approved for the subsidiaries at
34,900 for the subsidiaries at the end 32,900
the end of the reporting period
of the reporting period (B4)
(B3)
Total guarantee amount provided by the company (total of the above-mentioned two kinds of guarantees)
Total guarantee line approved Total actual occurred amount
during the reporting period 34,900 of guarantee during the 32,900
(A1+B1) reporting period (A2+B2)
Total guarantee line that has been Total actual guarantee balance
34,900 32,900
approved at the end of the at the end of the reporting
22
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
reporting period period (A4+B4)
(A3+B3)
Proportion of total guarantee amount (A4+B4) to the net assets
18.18%
of the Company
Of which:
Amount of debt guarantee provided for the guaranteed party
whose asset-liability ratio is not less than 70% directly or 32,900
indirectly (D)
Total amount of the above three guarantees (C+D+E) 32,900
Explanation on guarantee that adopts complex method
(1) Particulars about illegal external guarantee
□ Applicable √ Inapplicable
There was no particular about illegal external guarantee of the Company in the reporting period.
3. Other significant contracts
□ Applicable √ Inapplicable
There was no other significant contract of the Company in the reporting period.
4. Other significant transactions
□ Applicable √ Inapplicable
There was no other significant transaction of the Company in the reporting period.
X. Commitments made by the Company or shareholders holding over 5% of the Company’s
shares in the reporting period or such commitments carried down into the reporting period
√ Applicable □ Inapplicable
Commitmen Date of Period of
Commitment Contents of commitment Execution
t maker commitment commitment
Commitments of share
-
reform
I. Commitments on avoiding horizontal Up to the date of
competition: 1. excepting the Company proposed declaration of
Commitments made in Celsius conducting transaction may lead to competition in the report, the
acquisition report or in Property domestic trade with Shenzhen NOPOSION Within 7 commitments
7 Sep. 2013
report on changes of B.V. and Agrochemical Co., Ltd. disclosed in the B Shares years were being
equity MAI Offer Acquisition Report of Hubei Sanonda CO., carried out and
Ltd. The Company will take effective measures to the committers
avoid the Company and its controlling abided by the
23
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
subsidiaries engaged in the same or similar above
business with Hubei Sanonda CO., Ltd. within the commitments.
territory.2. If the Company or its controlling
subsidiaries domestically conduct related business
which form horizontal competition with Hubei
Sanonda CO., Ltd. in future (including related
business of the Company proposed conducting
transaction may lead to competition in domestic
trade with Shenzhen NOPOSION Agrochemical
Co., Ltd. disclosed in the B Shares Offer
Acquisition Report of Hubei Sanonda CO., Ltd.)
The Company will according to the securities
laws and regulations and industry policy within 7
years or when the management think the
condition is ripe to actively take steps, gradually
eliminate the competition, the concrete measures
including but not limited to the following one or
more: fight for internal assets reconstruction,
(including putting the business into Hubei
Sanonda CO., Ltd. or operated through Hubei
Sanonda CO., Ltd. ) to adjust the industrial plan
and business structure, to transform technology
and to upgrade products, to divide the market so
as to make each corporation differ in the products
and its ultimate users, thus to avoid and eliminate
the current domestic horizontal competition
between the Company’s controlling subsidiaries
and Sanonda.
II. Commitments on maintaining the Company’s
operation independence and specify the related
transaction: 1. After the complement of the tender
offer, Sanonda will continues to maintain Up to the date of
complete purchase, production and sales system, declaration of
and to gain the independent intellectual property. the report, the
Celsius The Company and its direct or indirect controlling commitments
Property shareholders and Sanonda of which the personnel, were being
7 Sep. 2013 Long term
B.V. and assets, finance, business and institutions will be carried out and
MAI completely separated, and at the same time the committers
maintain the operation ability of Sanonda that abided by the
independently face to the China agrochemical above
industry market. 2. The Company will avoid and commitments.
reduce the related transactions with Sanonda
according to the requirements stipulated by the
laws, regulations and other normative documents;
24
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
but for those related transactions that are
inevitable or occur with reasonable cause, will
have to obey the just, fair and open market
principles. And to sign the agreement according to
the law and to carry out legal program, and to
make sure not to harm the legal interest of
Sanonda and other shareholders by related
transaction according to the Articles of
Association of Sanonda, the relevant system
about related transaction and to conduct the duty
of information disclosure as well as the approval
process which stipulated by the relevant
regulations."
I. Commitments on avoiding horizontal
competition: 1. The business of the Company’s
subsidiaries-- Jiangsu Anpon Electrochemical
Co., Ltd., Anhui Petroleum Chemical Group Co.,
Ltd., Shangdong Dacheng Agrochemical Co., Ltd.
and Jiamusi Heilong Agrochemicals Co., Ltd.,
and Hunan Haohua Chemical Co., Ltd. and its
subsidiary had the same or similar situations with
the main business of Sanonda, and aimed at the
domestic horizontal competition, the Company
committed to gradually eliminate such kind of
Up to the date of
horizontal competition in the future and to fight
declaration of
for the internal assets reconstruction, to adjust the
the report, the
industrial plan and business structure, to
China commitments
transform technology and to upgrade products, to
National Within 7 were being
divide the market so as to make each corporation 7 Sep. 2013
Chemical years carried out and
differ in the products and its ultimate users
Corporation the committers
according to the securities laws and regulations
abided by the
and industry policy within 7 years, thus to
above
eliminate the current domestic horizontal
commitments.
competition between the Company’s controlling
subsidiaries and Sanonda. 2. Excepting the
competition situation disclosed in the offer
acquisition report, the Company take effective
measures to avoid the Company and its
controlling subsidiaries ( excepting Commitments
respectively made in acquisition report by Celsius
Property B.V. and MAI )’ new increased business
engaged in the same or similar business with
Hubei Sanonda CO., Ltd. within the territory in
future. 3. If the Company or its controlling
25
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
subsidiaries (excepting Commitments
respectively made in acquisition report by Celsius
Property B.V. and MAI) domestically conduct
related business which form horizontal
competition with Hubei Sanonda CO., Ltd. in
future, the Company will actively take steps,
gradually eliminate the competition, the concrete
measures including but not limited to fight for
internal assets reconstruction, (including putting
the business into Hubei Sanonda CO., Ltd. or
operated through Hubei Sanonda CO., Ltd.) to
adjust the industrial plan and business structure,
to transform technology and to upgrade products,
to divide the market so as to make each
corporation differ in the products and its ultimate
users, thus to avoid and eliminate the current
domestic horizontal competition between the
Company’s controlling subsidiaries and Sanonda.
II. Commitments on maintaining the Company’s
operation independence and specify the related
transaction: 1. After the complement of the tender
offer, Sanonda will continues to maintain
complete purchase, production and sales system,
and to gain the independent intellectual property.
The Company and its direct or indirect controlling
shareholders and Sanonda of which the personnel,
assets, finance, business and institutions will be Up to the date of
completely separated, and at the same time declaration of
maintain the operation ability of Sanonda that the report, the
China independently face to the China agrochemical commitments
National industry market. 2. The Company will avoid and were being
7 Sep. 2013 Long term
Chemical reduce the related transactions with Sanonda carried out and
Corporation according to the requirements stipulated by the the committers
laws, regulations and other normative documents; abided by the
but for those related transactions that are above
inevitable or occur with reasonable cause, will commitments.
have to obey the just, fair and open market
principles. And to sign the agreement according to
the law and to carry out legal program, and to
make sure not to harm the legal interest of
Sanonda and other shareholders by related
transaction according to the Articles of
Association of Sanonda, the relevant system
about related transaction and to conduct the duty
26
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
of information disclosure as well as the approval
process which stipulated by the relevant
regulations.
Commitments made at
the time of assets -
reorganization
Commitments made in
the initial public -
offering or refinancing
Commitments made
by the company to
-
other medium and
small shareholders
Executed timely or
Yes
not?
Detailed reason for
failing to execute and Inapplicable
the next plan (if any)
XI. Particulars about engagement and disengagement of CPAs firm
Whether the semi-annual financial report had been audited?
□ Yes √ No
XII. Punishment and Rectification
□ Applicable √ Inapplicable
There was no any punishment and rectification of the Company in the reporting period.
XIII. Reveal of the delisting risks of illegal or violation
□ Applicable √ Inapplicable
There was no any delisting risk of illegal or violation of the Company in the reporting period.
XIV. Explanation about other significant matters
√ Applicable □ Inapplicable
1. On 12 Mar. 2014, the Company disclosed the Indicative Announcement of the Proposed Restructuring of the Controlling
Shareholders of the Company and disclosed the Announcement of the Completion of the Restructuring and Rename of the
Controlling Shareholders of the Company on 15 Apr. On 27 Mar., the Company disclosed the Voluntary Information Disclosure
Announcement of the Due Diligence Investigation of the Company by the Intermediaries, and up the date of the announcement, the
intermediaries engaged by China National Agrochemical Corporation and ADAMA Agricultural Solutions LTD. was during its due
diligence investigation of the Company. (The above announcements were disclosed on the appointed information disclosure media of
27
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
the Company)
2. The significant project—300,000 tons/year reformation project of the energy saving and emission reduction of the caustic soda
devices. Of which, the total investment of the 200,000 tons/year caustic soda project was estimated of 0.76 billion. Up the end of the
reporting period, the Company had completed 82% of the project progress and the project was estimated that could have test run
within Y2014.
3. During the reporting period, the 10,000 tons/year pyridine and the derivation project of the Company was already able to
constantly execute for an extended period during the trial production, and the pyridine productions could basically meet with the
manufacturer requirements of the paraquat of the Company. But there still had certain problems which needed to be further
certificated as well as optimized in the progress of test run.
4. The members of the Board of Directors were not sufficient. Up to the end of the reporting period, the members of the Board of
Directors were 8, while the Regulations of the Company stipulated that should be 10, which mostly due to the recent two years, the
indirectly controlling shareholders China National Agrochemical Corporation had been constantly planning the whole matters about
the asset business involved with the Company. For example, the significant asset restructuring in 2012 (announced to terminate in the
end), and its controlling company ADAMA which offered to purchase the B share of the Company in 2013 etc, all had not put
forward any specific board candidate, which led to the insufficient of the members of the Board of Directors.
5. On 24 Apr. 2014, Department of Agricultural, Department of Industry and Informationization and AQSIQ announced the No. 1745
document which read: “Since 1 Jul. 2014, repeals the registration and production permit of paraquat aqueous solution, stops the
production and maintain the use registration of the export of the technical concentrate production water aqua and allows the exclusively
for export production. Stop the sales and use of the water aqua in the domestic country since 1 Jul. 2016.” Analyze based on the sales
data of the paraquat of the Company in the reporting period, the sales volume of the paraquat aqueous solution was of 40% of the whole
sales of the paraquat, and about 80% of the paraquat were sold by export. So the execution of the document will not have large impact
on the Company.
6. On 30 Jun. 2014, the Company reviewed and approved the Proposal about the Shareholder Celsius Property B.V. Proposed to
Engage Ruihua Certified Public Accountants (LLP) to Check and Approve Each Quarterly Report of the Company and to Audit the
2014 Annual Report. According to the relevant regulations, the Company had signed the related confidentiality agreement with Ruihua
Certified Public Accountants (LLP) and up to the date of the announcement, the latter had basically completed the audit work of the
first half year of 2014 of the Company.
28
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Section VI. Changes in Share Capital and Particulars about
Shareholders
I. Changes in share capital
Unit: Share
Before this change Increase/decrease (+, -) After the change
Capitalizat
Issuance ion of
Proportion Bonus Proportio
Amount of new public Other Subtotal Amount
(%) share n (%))
shares reserve
fund
I. Shares subject to trading
32,467 0.01% 32,467 0.01%
moratorium
1. State-owned shares 0 0.00% 0 0.00%
2. State-owned legal
person 0 0.00% 0 0.00%
shares
3. Other domestic shares 32,467 0.01% 32,467 0.01%
Including: Shares held by
0 0.00% 0 0.00%
domestic legal persons
Shares held by domestic
32,467 0.01% 32,467 0.01%
individuals
4. Shares held by
0 0.00% 0 0.00%
overseas shareholders
Including: Shares held by
0 0.00% 0 0.00%
overseas legal persons
Shares held by overseas
0 0.00% 0 0.00%
individuals
II. Shares not subject to 593,890,7 593,890,7
99.99% 99.99%
trading moratorium 53 53
1. Ordinary shares 363,893,8 363,893,8
61.27% 61.27%
denominated in RMB 28 28
2. Domestically listed 229,996,9 229,996,9
38.73% 38.73%
foreign shares 25 25
29
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
3. Overseas listed foreign
0 0.00% 0 0.00%
shares
4. Other 0 0.00% 0 0.00%
593,923,2 593,923,2
III. Total of shares 100.00% 100.00%
20 20
Reasons for changes in share
□ Applicable √ Inapplicable
Approval of share changes
□ Applicable √ Inapplicable
Transfers in share changes
□ Applicable √ Inapplicable
Influence of share changes towards financial indexes in the latest year and latest period such as basic EPS and diluted EPS, and net
assets per share belonging to shareholder with ordinary share
□ Applicable √ Inapplicable
Other contents that the Company thinks necessary or is asked by securities regulators to be disclosed
□ Applicable √ Inapplicable
Explanation of the changes in the sum of the shares and the structure of the shareholders and the structure of the assets as well as the
liabilities of the Company
□ Applicable √ Inapplicable
II. Number of shareholders and shareholding
Unit: Share
Total number of preferred
Total number of common
shareholders that had restored the
shareholders at the end of the 41,812 0
voting right at the end of the
reporting period
reporting period (if any) (note 8)
Shareholding of shareholders holding more than 5% shares
Number Pledged or frozen shares
Increase of
Number of and shares Number of
shareholding decrease of held shares held
Name of Nature of Holding
at the end of shares subject not subject Number of
shareholder shareholder percentage (%) Status of shares
the reporting during to to trading shares
period reporting trading moratorium
period moratori
um
SANONDA
State-owned
GROUP 20.15% 119,687,202 0 0 119,687,202
legal person
CORPORATION
30
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Celsius Property Foreign legal
10.60% 62,950,659 0 0 62,950,659
B.V. person
Bank of
China—Harvest
Stable Open Other 1.14% 6,760,000 6,760,000 0 6,760,000
Securities
Investment Fund
Domestic
Song Na 1.12% 6,666,600 -1,597,207 0 6,666,600
natural person
Industrial and
Commercial
Bank of China－
Other 0.84% 5,001,417 5001,417 0 5,001,417
Bosera Selected
Stock Securities
Investment Fund
Industrial and
Commercial
Bank of China－
Huitianfu Meili Other 0.73% 4,339,340 4,339,340 0 4,339,340
30 Stock
Securities
Investment Fund
STATE-OWNED
ASSETS
ADMINISTRATI
Nation 0.70% 4,169,266 0 0 4,169,266
ON BUREAU
OF QICHUN
COUNTY
Domestic
Shen Hefei 0.63% 3,768,445 3,768,445 0 3,768,445
natural person
Agricultural
Bank of China－
Invesco Great
Wall Domestic
Other 0.63% 3,718,622 3,718,622 0 3,718,622
Demand Growth
No. 2 Stock
Securities
Investment Fund
Industrial and
Commercial
Other 0.62% 3,688,214 3,688,214 0 3,688,214
Bank of China－
Invesco Great
31
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Wall Rising
Growth Stock
Securities
Investment Fund
Strategic investors or the general
legal person due to the placement
Naught
of new shares become the top 10
shareholders（if any）(note 3)
Sanonda Group Corporation (now renamed as Jingzhou Sanonda Holdings Co., Ltd.) and Celsius
Property B.V. are related parties, and under the same control of China National Chemical
Explanation on associated Agrochemical Corporation, and are acting-in-concert parties as prescribed in the Administrative
relationship or/and persons Methods for Acquisition of Listed Companies. It is unknown whether the other shareholders are
related parties or acting-in-concert parties as prescribed in the Administrative Methods for
Acquisition of Listed Companies.
Particulars about shares held by top 10 shareholders not subject to trading moratorium
Number of shares held not subject to trading Type of share
Name of shareholder
moratorium at the end of the period Type of share Number
SANONDA GROUP
119,687,202 RMB ordinary share 119,687,202
CORPORATION
Domestically listed
Celsius Property B.V. 62,950,659 62,950,659
foreign share
Bank of China—Harvest Stable
6,760,000 RMB ordinary share 6,760,000
Open Securities Investment Fund
Song Na 6,666,600 RMB ordinary share 6,666,600
Industrial and Commercial Bank
of China－Bosera Selected Stock 5,001,417 RMB ordinary share 5,001,417
Securities Investment Fund
Industrial and Commercial Bank
of China－Huitianfu Meili 30 4,339,340 RMB ordinary share 4,339,340
Stock Securities Investment Fund
STATE-OWNED ASSETS
ADMINISTRATION BUREAU 4,169,266 RMB ordinary share 4,169,266
OF QICHUN COUNTY
Shen Hefei 3,768,445 RMB ordinary share 3,768,445
Agricultural Bank of China－
Invesco Great Wall Domestic
3,718,622 RMB ordinary share 3,718,622
Demand Growth No. 2 Stock
Securities Investment Fund
Industrial and Commercial Bank
3,688,214 RMB ordinary share 3,688,214
of China－Invesco Great Wall
32
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Rising Growth Stock Securities
Investment Fund
Explanation on associated
relationship among the top ten STATE-OWNED ASSETS ADMINISTRATION BUREAU OF QICHUN COUNTY held the
shareholders of tradable share not shares of the Company on behalf of the country. Sanonda Group Corporation (now renamed as
subject to trading moratorium, as Jingzhou Sanonda Holdings Co., Ltd.) and Celsius Property B.V. are related parties, and under the
well as among the top ten same control of China National Chemical Agrochemical Corporation, and are acting-in-concert
shareholders of tradable share not parties as prescribed in the Administrative Methods for Acquisition of Listed Companies. It is
subject to trading moratorium and unknown whether the other shareholders are related parties or acting-in-concert parties as
top ten shareholders, or prescribed in the Administrative Methods for Acquisition of Listed Companies.
explanation on acting-in-concert
Particular about shareholder
participate in the securities
Naught
lending and borrowing business
( if any)( note 4)
Did any shareholder of the Company carry out an agreed buy-back in the reporting period?
□ Yes √ No
Shareholders of the Company had not carried out any agreed buy-back in the reporting period.
III. Change of the controlling shareholder or the actual controller
Change of the controlling shareholder in the reporting period
□ Applicable √ Inapplicable
There was no any change of the controlling shareholder of the Company in the reporting period.
Change of the actual controller in the reporting period
□ Applicable √ Inapplicable
There was no any change of the actual controller of the Company in the reporting period.
IV. Particulars on shareholding increase scheme during the reporting period proposed or
implemented by the shareholders and act-in-concert persons
□ Applicable √ Inapplicable
Within the scope known to the Company, there was no any shareholding increase scheme during the reporting period proposed or
implemented by the shareholders and act-in-concert persons.
33
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Section VII. Situation of the Preferred Shares
Naught
34
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Section VIII. Directors, Supervisors, Senior Management Staffs
I. Changes in shareholding of directors, supervisors and senior management staffs
□ Applicable √ Inapplicable
There was no change in shareholding of directors, supervisors and senior management staffs, for the specific information please refer
to the 2013 Annual Report.
II. Changes in directors, supervisors and senior management staffs
□ Applicable √ Inapplicable
There was no change in directors, supervisors and senior management staffs, for the specific information please refer to the 2013
Annual Report.
IX. Financial Report
I. Audit report
Has this semi-annual report been audited?
□ Yes √ No
The semi-annual financial report has not been audited.
II. Financial statements
Currency unit for the statements in the notes to these financial statements: RMB Yuan
1. Consolidated balance sheet
Prepared by Hubei Sanonda Co., Ltd.
Unit: RMB Yuan
Item Closing balance Opening balance
Current Assets:
Monetary funds 480,907,972.05 414,065,921.21
Settlement reserves
Intra-group lendings
Transactional financial assets
Notes receivable 25,163,142.66 41,103,985.15
Accounts receivable 397,091,744.43 209,166,447.16
35
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Accounts paid in advance 47,968,892.51 43,042,028.26
Premiums receivable
Reinsurance premiums receivable
Receivable reinsurance contract
reserves
Interest receivable
Dividend receivable
Other accounts receivable 9,051,074.45 7,224,391.05
Financial assets purchased under
agreements to resell
Inventories 328,216,773.85 258,274,457.88
Non-current assets due within 1 year
Other current assets
Total current assets 1,288,399,599.95 972,877,230.71
Non-current assets:
Loans by mandate and advances
granted
Available-for-sale financial assets
Held-to-maturity investments
Long-term accounts receivable
Long-term equity investment 9,153,782.63 9,153,782.63
Investing property 4,034,212.50 4,154,412.50
Fixed assets 1,248,374,740.55 1,324,222,385.03
Construction in progress 390,563,322.24 234,487,866.23
Engineering materials 42,891,451.11
Disposal of fixed assets
Production biological assets
Oil-gas assets
Intangible assets 138,458,587.64 137,371,149.10
R&D expense
Goodwill
Long-term deferred expenses
Deferred income tax assets 12,533,590.90 12,619,948.14
Other non-current assets 13,384,400.00 13,384,400.00
Total of non-current assets 1,859,394,087.57 1,735,393,943.63
36
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Total assets 3,147,793,687.52 2,708,271,174.34
Current liabilities:
Short-term borrowings 295,000,000.00 359,220,205.55
Borrowings from Central Bank
Customer bank deposits and due to
banks and other financial institutions
Intra-group borrowings
Transactional financial liabilities
Notes payable 140,000,000.00 40,000,000.00
Accounts payable 256,334,942.55 156,037,973.10
Accounts received in advance 42,340,553.78 79,437,442.04
Financial assets sold for repurchase
Handling charges and commissions
payable
Employee’s compensation payable 15,892,051.41 25,332,986.86
Tax payable 98,705,954.00 73,337,138.50
Interest payable
Dividend payable 250,000.00 250,000.00
Other accounts payable 34,476,162.13 34,544,608.36
Reinsurance premiums payable
Insurance contract reserves
Payables for acting trading of
securities
Payables for acting underwriting of
securities
Non-current liabilities due within 1
7,990,000.00 77,390,000.00
year
Other current liabilities
Total current liabilities 890,989,663.87 845,550,354.41
Non-current liabilities:
Long-term borrowings 421,590,000.00 296,090,000.00
Bonds payable
Long-term payables 650,000.00 650,000.00
Specific payables
Estimated liabilities
37
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Deferred income tax liabilities
Other non-current liabilities 25,170,925.93 19,538,888.89
Total non-current liabilities 447,410,925.93 316,278,888.89
Total liabilities 1,338,400,589.80 1,161,829,243.30
Owners’ equity (or shareholders’
equity)
Paid-up capital (or share capital) 593,923,220.00 593,923,220.00
Capital reserves 263,184,043.66 263,184,043.66
Less: Treasury stock
Specific reserves 20,492,076.17 16,059,288.71
Surplus reserves 126,334,248.31 126,334,248.31
Provisions for general risks
Retained profits 805,399,207.11 546,688,770.98
Foreign exchange difference
Total equity attributable to owners of
1,809,332,795.25 1,546,189,571.66
the Company
Minority interests 60,302.47 252,359.38
Total owners’ (or shareholders’) equity 1,809,393,097.72 1,546,441,931.04
Total liabilities and owners’ (or
3,147,793,687.52 2,708,271,174.34
shareholders’) equity
Legal representative: Li Zuorong Person-in-charge of the accounting work: He Xuesong
Chief of the accounting division: He Xuesong
2. Balance sheet of the Company
Prepared by Hubei Sanonda Co., Ltd
Unit: RMB Yuan
Item Closing balance Opening balance
Current Assets:
Monetary funds 387,812,604.82 329,849,120.35
Transactional financial assets
Notes receivable 24,863,142.66 41,103,985.15
Accounts receivable 567,586,092.68 193,013,915.85
Accounts paid in advance 47,151,026.00 42,670,595.78
Interest receivable
38
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Dividend receivable
Other accounts receivable 72,089,773.57 144,872,701.27
Inventories 317,978,734.42 254,766,534.37
Non-current assets due within 1 year
Other current assets
Total current assets 1,417,481,374.15 1,006,276,852.77
Non-current assets:
Available-for-sale financial assets
Held-to-maturity investments
Long-term accounts receivable
Long-term equity investment 64,680,418.04 64,680,418.04
Investing property 4,034,212.50 4,154,412.50
Fixed assets 1,086,200,715.20 1,153,224,118.73
Construction in progress 388,193,930.35 234,487,866.23
Engineering materials 42,891,451.11
Disposal of fixed assets
Production biological assets
Oil-gas assets
Intangible assets 125,588,210.53 125,275,394.07
R&D expense
Goodwill
Long-term deferred expenses
Deferred income tax assets 7,500,900.81 7,587,719.43
Other non-current assets 13,384,400.00 13,384,400.00
Total of non-current assets 1,732,474,238.54 1,602,794,329.00
Total assets 3,149,955,612.69 2,609,071,181.77
Current liabilities:
Short-term borrowings 295,000,000.00 283,000,000.00
Transactional financial liabilities
Notes payable 140,000,000.00 40,000,000.00
Accounts payable 251,451,190.01 151,132,431.37
Accounts received in advance 20,692,813.35 49,176,997.90
Employee’s compensation payable 15,872,648.79 22,813,584.24
Tax payable 112,953,053.39 87,016,104.58
39
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Interest payable
Dividend payable 250,000.00 250,000.00
Other accounts payable 30,187,032.43 33,560,585.60
Non-current liabilities due within 1
7,990,000.00 77,390,000.00
year
Other current liabilities
Total current liabilities 874,396,737.97 744,339,703.69
Non-current liabilities:
Long-term borrowings 421,590,000.00 296,090,000.00
Bonds payable
Long-term payables 650,000.00 650,000.00
Specific payables
Estimated liabilities
Deferred income tax liabilities
Other non-current liabilities 16,320,925.93 10,688,888.89
Total non-current liabilities 438,560,925.93 307,428,888.89
Total liabilities 1,312,957,663.90 1,051,768,592.58
Owners’ equity (or shareholders’
equity)
Paid-up capital (or share capital) 593,923,220.00 593,923,220.00
Capital reserves 263,799,837.18 263,799,837.18
Less: Treasury stock
Specific reserves 15,522,963.86 11,090,176.40
Surplus reserves 126,334,248.31 126,334,248.31
Provisions for general risks
Retained profits 837,417,679.44 562,155,107.30
Foreign exchange difference
Total owners’ (or shareholders’) equity 1,836,997,948.79 1,557,302,589.19
Total liabilities and owners’ (or
3,149,955,612.69 2,609,071,181.77
shareholders’) equity
Legal representative: Li Zuorong Person-in-charge of the accounting work: He Xuesong
Chief of the accounting division: He Xuesong
40
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
3. Consolidated income statement
Prepared by Hubei Sanonda Co., Ltd
Unit: RMB Yuan
Item Jan.-Jun. 2014 Jan.-Jun 2013
I. Total operating revenues 1,700,281,424.68 1,519,688,317.22
Including: Sales income 1,700,281,424.68 1,519,688,317.22
Interest income
Premium income
Handling charge and
commission income
II. Total operating cost 1,308,246,932.27 1,349,729,055.68
Including: Cost of sales 1,176,489,773.88 1,210,871,838.98
Interest expenses
Handling charge and
commission expenses
Surrenders
Net claims paid
Net amount withdrawn for the
insurance contract reserve
Expenditure on policy dividends
Reinsurance premium
Taxes and associate charges 3,621,233.43 1,055,982.69
Selling and distribution expenses 43,196,541.82 45,575,412.03
Administrative expenses 56,494,485.42 46,726,703.36
Financial expenses 17,251,932.88 40,211,554.98
Asset impairment loss 11,192,964.84 5,287,563.64
Add: Gain/(loss) from change in fair
value (“-” means loss)
Gain/(loss) from investment (“-”
2,254,182.43
means loss)
Including: share of profits in associates
and joint ventures
Foreign exchange gains (“-” means
loss)
III. Business profit (“-” means loss) 392,034,492.41 172,213,443.97
41
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Add: non-operating income 1,448,403.98 1,231,751.57
Less: non-operating expense 278,888.58 2,797,209.72
Including: loss from non-current asset
disposal
IV. Total profit (“-” means loss) 393,204,007.81 170,647,985.82
Less: Income tax expense 104,989,467.59 43,970,999.05
V. Net profit (“-” means loss) 288,214,540.22 126,676,986.77
Including: Net profit achieved by
combined parties before the
combinations
Attributable to owners of the
288,406,597.13 127,470,524.25
Company
Minority shareholders’ income -192,056.91 -793,537.48
VI. Earnings per share -- --
(I) Basic earnings per share 0.4856 0.2146
(II) Diluted earnings per share 0.4856 0.2146
Ⅶ. Other comprehensive incomes
Ⅷ. Total comprehensive incomes 288,214,540.22 126,676,986.77
Attributable to owners of the
288,406,597.13 127,470,524.25
Company
Attributable to minority
-192,056.91 -793,537.48
shareholders
Legal representative: Li Zuorong Person-in-charge of the accounting work: He Xuesong
Chief of the accounting division: He Xuesong
4. Income statement of the Company
Prepared by Hubei Sanonda Co., Ltd
Unit: RMB Yuan
Item Jan.-Jun. 2014 Jan.-Jun 2013
I. Total sales 1,686,765,886.62 1,496,564,787.97
Less: cost of sales 1,171,797,949.08 1,204,298,974.60
Business taxes and surcharges 3,511,152.06 752,515.01
Distribution expenses 40,996,690.93 39,184,498.86
Administrative expenses 43,148,607.10 35,163,220.48
Financial costs 17,142,695.47 39,342,339.27
42
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Impairment loss 3,070,529.98 1,928,293.40
Add: gain/(loss) from change in fair
value (“-” means loss)
Gain/(loss) from investment (“-” means
2,904,182.43
loss)
Including: income form investment on
associates and joint ventures
II. Business profit (“-” means loss) 407,098,262.00 178,799,128.78
Add: non-business income 1,447,139.50 632,662.33
Less: non-business expense 242,608.58 2,135,828.74
Including: loss from non-current asset
disposal
III. Total profit (“-” means loss) 408,302,792.92 177,295,962.37
Less: income tax expense 103,344,059.78 43,677,440.85
IV. Net profit (“-” means loss) 304,958,733.14 133,618,521.52
V. Earnings per share -- --
(I) Basic earnings per share
(II) Diluted earnings per share
VI. Other comprehensive income
VII. Total comprehensive income 304,958,733.14 133,618,521.52
Legal representative: Li Zuorong Person-in-charge of the accounting work: He Xuesong
Chief of the accounting division: He Xuesong
5. Consolidated cash flow statement
Prepared by Hubei Sanonda Co., Ltd
Unit: RMB Yuan
Item Jan.-Jun. 2014 Jan.-Jun 2013
I. Cash flows from operating activities:
Cash received from sale of
1,367,459,203.26 1,216,585,450.97
commodities and rendering of service
Net increase of deposits from
customers and dues from banks
Net increase of loans from the central
bank
Net increase of funds borrowed from
43
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
other financial institutions
Cash received from premium of
original insurance contracts
Net cash received from reinsurance
business
Net increase of deposits of policy
holders and investment fund
Net increase of disposal of tradable
financial assets
Cash received from interest, handling
charges and commissions
Net increase of intra-group
borrowings
Net increase of funds in repurchase
business
Tax refunds received 4,383,350.82 38,414,903.11
Other cash received relating to
13,954,739.31 20,644,853.51
operating activities
Subtotal of cash inflows from operating
1,385,797,293.39 1,275,645,207.59
activities
Cash paid for goods and services 779,581,645.64 699,777,411.14
Net increase of customer lendings
and advances
Net increase of funds deposited in the
central bank and amount due from
banks
Cash for paying claims of the original
insurance contracts
Cash for paying interest, handling
charges and commissions
Cash for paying policy dividends
Cash paid to and for employees 97,626,590.15 70,993,456.21
Various taxes paid 92,259,070.25 43,519,631.33
Other cash payment relating to
42,219,221.60 39,201,585.07
operating activities
Subtotal of cash outflows from
1,011,686,527.64 853,492,083.75
operating activities
Net cash flows from operating activities 374,110,765.75 422,153,123.84
44
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
II. Cash flows from investing activities:
Cash received from withdrawal of
investments
Cash received from return on
2,254,182.43
investments
Net cash received from disposal of
fixed assets, intangible assets and other 1,350.00 248,934.00
long-term assets
Net cash received from disposal of
subsidiaries or other business units
Other cash received relating to
investing activities
Subtotal of cash inflows from
1,350.00 2,503,116.43
investing activities
Cash paid to acquire fixed assets,
intangible assets and other long-term 239,347,876.88 65,136,665.53
assets
Cash paid for investment
Net increase of pledged loans
Net cash paid to acquire subsidiaries
and other business units
Other cash payments relating to
investing activities
Subtotal of cash outflows from
239,347,876.88 65,136,665.53
investing activities
Net cash flows from investing activities -239,346,526.88 -62,633,549.10
III. Cash Flows from Financing
Activities:
Cash received from capital
contributions
Including: Cash received from
minority shareholder investments by
subsidiaries
Cash received from borrowings 444,659,359.80 703,440,215.57
Cash received from issuance of
bonds
Other cash received relating to
financing activities
45
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Subtotal of cash inflows from financing
444,659,359.80 703,440,215.57
activities
Repayment of borrowings 452,779,565.35 595,669,879.59
Cash paid for interest expenses and
58,781,937.07 60,200,842.26
distribution of dividends or profit
Including: dividends or profit paid
by subsidiaries to minority shareholders
Other cash payments relating to
22,570,000.00 31,525,101.46
financing activities
Sub-total of cash outflows from
534,131,502.42 687,395,823.31
financing activities
Net cash flows from financing activities -89,472,142.62 16,044,392.26
IV. Effect of foreign exchange rate
549,954.59 -1,022,847.09
changes on cash and cash equivalents
V. Net increase in cash and cash
45,842,050.84 374,541,119.91
equivalents
Add: Opening balance of cash and
410,065,921.21 175,181,365.77
cash equivalents
VI. Closing balance of cash and cash
455,907,972.05 549,722,485.68
equivalents
Legal representative: Li Zuorong Person-in-charge of the accounting work: He Xuesong
Chief of the accounting division: He Xuesong
6. Cash flow statement of the Company
Prepared by Hubei Sanonda Co., Ltd
Unit: RMB Yuan
Item Jan.-Jun. 2014 Jan.-Jun 2013
I. Cash flows from operating activities:
Cash received from sale of
1,236,735,248.79 1,180,407,638.73
commodities and rendering of service
Tax refunds received 1,101,773.34 32,620,291.11
Other cash received relating to
14,217,450.41 14,527,560.25
operating activities
Subtotal of cash inflows from operating
1,252,054,472.54 1,227,555,490.09
activities
Cash paid for goods and services 760,954,770.21 642,233,436.72
46
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Cash paid to and for employees 91,179,664.45 61,740,235.42
Various taxes paid 90,688,019.32 38,874,866.67
Other cash payment relating to
24,514,521.76 33,820,822.19
operating activities
Subtotal of cash outflows from
967,336,975.74 776,669,361.00
operating activities
Net cash flows from operating activities 284,717,496.80 450,886,129.09
II. Cash flows from investing activities:
Cash received from retraction of
investments
Cash received from return on
2,254,182.43
investments
Net cash received from disposal of
fixed assets, intangible assets and other 1,350.00 248,934.00
long-term assets
Net cash received from disposal of
subsidiaries or other business units
Other cash received relating to
investing activities
Subtotal of cash inflows from
1,350.00 2,503,116.43
investing activities
Cash paid to acquire fixed assets,
intangible assets and other long-term 236,414,585.88 63,062,598.35
assets
Cash paid for investment 5,906,730.00
Net cash paid to acquire subsidiaries
and other business units
Other cash payments relating to
investing activities
Subtotal of cash outflows from
236,414,585.88 68,969,328.35
investing activities
Net cash flows from investing activities -236,413,235.88 -66,466,211.92
III. Cash Flows from Financing
Activities:
Cash received from capital
contributions
Cash received from borrowings 376,000,000.00 498,000,000.00
Cash received from issuance of
47
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
bonds
Other cash received relating to
financing activities
Subtotal of cash inflows from financing
376,000,000.00 498,000,000.00
activities
Repayment of borrowings 307,900,000.00 512,560,000.00
Cash paid for interest expenses and
56,747,327.28 57,358,841.82
distribution of dividends or profit
Other cash payments relating to
22,570,000.00 24,880,000.00
financing activities
Sub-total of cash outflows from
387,217,327.28 594,798,841.82
financing activities
Net cash flows from financing activities -11,217,327.28 -96,798,841.82
IV. Effect of foreign exchange rate
-123,449.17 -45,549.93
changes on cash and cash equivalents
V. Net increase in cash and cash
36,963,484.47 287,575,525.42
equivalents
Add: Opening balance of cash and
325,849,120.35 149,485,252.01
cash equivalents
VI. Closing balance of cash and cash
362,812,604.82 437,060,777.43
equivalents
Legal representative: Li Zuorong Person-in-charge of the accounting work: He Xuesong
Chief of the accounting division: He Xuesong
7. Consolidated Statement of Changes in Owners’ Equity
Prepared by Hubei Sanonda Co., Ltd
Jan.-Jun. 2014
Unit: RMB Yuan
Jan.-Jun. 2014
Equity attributable to owners of the Company
Paid-up
Total
Item capital Minority
Less: General
Capital Specific Surplus Retaine owners’
(or treasury risk Others interests
reserve reserve reserve d profit equity
share stock reserve
capital)
I. Balance at the end of the 593,923 263,184, 16,059,2 126,334 546,688, 252,359.3 1,546,441,
previous year ,220.00 043.66 88.71 ,248.31 770.98 8 931.04
48
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Add: change of accounting
policy
Correction of errors in
previous periods
Other
II. Balance at the beginning of 593,923 263,184, 16,059,2 126,334 546,688, 252,359.3 1,546,441,
the year ,220.00 043.66 88.71 ,248.31 770.98 8 931.04
III. Increase/ decrease in the 4,432,78 258,710, -192,056. 262,951,16
period (“-” means decrease) 7.46 436.13 91 6.68
288,406, -192,056. 288,214,54
(I) Net profit
597.13 91 0.22
(II) Other comprehensive
incomes
288,406, -192,056. 288,214,54
Subtotal of (I) and (II)
597.13 91 0.22
(III) Capital paid in and
reduced by owners
1. Capital paid in by
owners
2. Amounts of share-based
payments recognized in
owners’ equity
3. Others
-29,696, -29,696,16
(IV) Profit distribution
161.00 1.00
1. Appropriations to
surplus reserves
2. Appropriations to
general risk provisions
3. Appropriations to -29,696, -29,696,16
owners (or shareholders) 161.00 1.00
4. Other
(V) Internal carry-forward of
owners’ equity
1. New increase of capital
(or share capital) from capital
public reserves
2. New increase of capital
(or share capital) from surplus
49
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
reserves
3. Surplus reserves for
making up losses
4. Other
4,432,78 4,432,787.
(Ⅵ) Specific reserve
7.46 46
1. Withdrawn for the 5,531,20 5,531,203.
period 3.68 68
1,098,41 1,098,416.
2. Used in the period
6.22 22
(Ⅶ) Other
593,923 263,184, 20,492,0 126,334 805,399, 1,809,393,
IV. Closing balance 60,302.47
,220.00 043.66 76.17 ,248.31 207.11 097.72
Jan.-Jun. 2013
Unit: RMB Yuan
Jan.-Jun. 2013
Equity attributable to owners of the Company
Paid-up
Total
Item Minority
capital Less: General
Capital Specific Surplus Retaine owners’
(or treasury risk Others interests
reserve reserve reserve d profit equity
share stock reserve
capital)
I. Balance at the end of the 593,923 266,090, 13,825,3 92,680, 289,017, 9,318,959 1,264,855,
previous year ,220.00 773.02 64.46 039.14 364.90 .09 720.61
Add: retrospective
adjustment due to business
combination under the same
control
Add: change of accounting
policy
Correction of errors in
previous periods
Other
II. Balance at the beginning of 593,923 266,090, 13,825,3 92,680, 289,017, 9,318,959 1,264,855,
the year ,220.00 773.02 64.46 039.14 364.90 .09 720.61
III. Increase/ decrease in the -2,924,5 30,448.3 97,984,1 -4,515,34 90,574,718
period (“-” means decrease) 67.83 9 80.81 2.56 .81
(I) Net profit 127,470, -793,537. 126,676,98
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
524.25 48 6.77
(II) Other comprehensive
incomes
127,470, -793,537. 126,676,98
Subtotal of (I) and (II)
524.25 48 6.77
(III) Capital paid in and -2,924,5 -2,982,16 -5,906,730.
reduced by owners 67.83 2.17 00
1. Capital paid in by
owners
2. Amounts of share-based
payments recognized in
owners’ equity
-2,924,5 -2,982,16 -5,906,730.
3. Others
67.83 2.17 00
-29,486, -350,000. -29,836,34
(IV) Profit distribution
343.44 00 3.44
1. Appropriations to
surplus reserves
2. New increase of capital
(or share capital) from surplus
reserves
3. Surplus reserves for -29,486, -350,000. -29,836,34
making up losses 343.44 00 3.44
4. Other
(V) Internal carry-forward of
owners’ equity
1. New increase of capital
(or share capital) from capital
public reserves
2. New increase of capital
(or share capital) from surplus
reserves
3. Surplus reserves for
making up losses
4. Other
30,448.3 -389,642. -359,194.5
(Ⅵ) Specific reserve
9 91 2
1. Withdrawn for the 5,317,74 324,559.1 5,642,304.
period 5.19 8 37
51
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
5,287,29 714,202.0 6,001,498.
2. Used in the period
6.80 9 89
(Ⅶ) Other
593,923 263,166, 13,855,8 92,680, 387,001, 4,803,616 1,355,430,
IV. Closing balance
,220.00 205.19 12.85 039.14 545.71 .53 439.42
Legal representative: Li Zuorong Person-in-charge of the accounting work: He Xuesong
Chief of the accounting division: He Xuesong
8. Statement of changes in owners’ equity of the Company
Prepared by Hubei Sanonda Co., Ltd
Jan.-Jun. 2014
Unit: RMB Yuan
Jan.-Jun. 2014
Paid-up
Less: General Total
Item capital (or Capital Specific Surplus Retained
treasury risk owners’
share reserve reserve reserve profit
stock reserve equity
capital)
I. Balance at the end of the 593,923,22 263,799,83 11,090,176 126,334,24 562,155,10 1,557,302,
previous year 0.00 7.18 .40 8.31 7.30 589.19
Add: change of accounting
policy
Correction of errors in
previous periods
Other
II. Balance at the beginning of 593,923,22 263,799,83 11,090,176 126,334,24 562,155,10 1,557,302,
the year 0.00 7.18 .40 8.31 7.30 589.19
III. Increase/ decrease in the 4,432,787. 275,262,57 279,695,35
period (“-” means decrease) 46 2.14 9.60
304,958,73 304,958,73
(I) Net profit
3.14 3.14
(II) Other comprehensive
incomes
304,958,73 304,958,73
Subtotal of (I) and (II)
3.14 3.14
(III) Capital paid in and
reduced by owners
1. Capital paid in by owners
52
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
2. Amounts of share-based
payments recognized in owners’
equity
3. Others
-29,696,16 -29,696,16
(IV) Profit distribution
1.00 1.00
1. Appropriations to surplus
reserves
2. Appropriations to general
risk provisions
3. Appropriations to owners -29,696,16 -29,696,16
(or shareholders) 1.00 1.00
4. Other
(V) Internal carry-forward of
owners’ equity
1. New increase of capital
(or share capital) from capital
public reserves
2. New increase of capital
(or share capital) from surplus
reserves
3. Surplus reserves for
making up losses
4. Other
4,432,787. 4,432,787.
(Ⅵ) Specific reserve
46 46
5,531,203. 5,531,203.
1. Withdrawn for the period
68 68
1,098,416. 1,098,416.
2. Used in the period
22 22
(Ⅶ) Other
593,923,22 263,799,83 15,522,963 126,334,24 837,417,67 1,836,997,
IV. Closing balance
0.00 7.18 .86 8.31 9.44 948.79
Jan.-Jun. 2013
Unit: RMB Yuan
Jan.-Jun. 2013
Item Paid-up Capital Less: Specific Surplus General Retained Total
capital (or reserve treasury reserve reserve risk profit owners’
53
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
share stock reserve equity
capital)
I. Balance at the end of the 593,923,22 263,799,83 8,127,543. 92,680,039 288,753,56 1,247,284,
previous year 0.00 7.18 89 .14 8.20 208.41
Add: change of accounting
policy
Correction of errors in
previous periods
Other
II. Balance at the beginning of 593,923,22 263,799,83 8,127,543. 92,680,039 288,753,56 1,247,284,
the year 0.00 7.18 89 .14 8.20 208.41
III. Increase/ decrease in the 104,132,17 104,891,33
759,156.66
period (“-” means decrease) 8.08 4.74
133,618,52 133,618,52
(I) Net profit
1.52 1.52
(II) Other comprehensive
incomes
133,618,52 133,618,52
Subtotal of (I) and (II)
1.52 1.52
(III) Capital paid in and
reduced by owners
1. Capital paid in by owners
2. Amounts of share-based
payments recognized in owners’
equity
3. Others
-29,486,34 -29,486,34
(IV) Profit distribution
3.44 3.44
1. Appropriations to surplus
reserves
2. Appropriations to general
risk provisions
3. Appropriations to owners -29,486,34 -29,486,34
(or shareholders) 3.44 3.44
4. Other
(V) Internal carry-forward of
owners’ equity
1. New increase of capital
54
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
(or share capital) from capital
public reserves
2. New increase of capital
(or share capital) from surplus
reserves
3. Surplus reserves for
making up losses
4. Other
(Ⅵ) Specific reserve 759,156.66 759,156.66
4,714,992. 4,714,992.
1. Withdrawn for the period
42 42
3,955,835. 3,955,835.
2. Used in the period
76 76
(Ⅶ) Other
593,923,22 263,799,83 8,886,700. 92,680,039 392,885,74 1,352,175,
IV. Closing balance
0.00 7.18 55 .14 6.28 543.15
Legal representative: Li Zuorong Person-in-charge of the accounting work: He Xuesong
Chief of the accounting division: He Xuesong
III. Company profile
Hubei Sanonda Co., Ltd. (hereinafter referred to as "Company" or "the Company") is formerly known as Hubei
Sha City Pesticides Factory, a state-run enterprise set up in 1958. As approved by the Hubei Commission for
Economic System Reformation and other authorities, Hubei Sha City Pesticides Factory was reorganized as Hubei
Sanonda Co., Ltd., which marked Hubei’s first large state-run industrial enterprise to adopt the stock system. On 8
Sept. 1992, upon the said reorganization, the Company was formally established. Later, as approved by the
People's Government of Hubei Province and the China Securities Regulatory Commission (“CSRC”), the
Company issued 30,000,000 RMB-denominated ordinary shares ("A shares") to the public in Nov. 1993. And the
total share capital of the Company was 104,933,900 shares after the public offering. The Sha City Bureau for
State-owned Assets Supervision and Administration is the first majority shareholder of the Company, with a
capital contribution of RMB 57,467,900, accounting for 54.77% of the Company’s total share capital. On 3 Dec.
1993, shares of the Company were listed in the Shenzhen Stock Exchange.
In Apr. 1994, a dividend distribution plan was reviewed and approved at the 1993 Annual Shareholders’ General
Meeting. RMB 2.00 was distributed in cash for every 10 shares held by the state and two bonus shares for every
10 shares held by individuals. The bonus shares were listed in 3 May 1994. And the Company’s total share capital
rose to 113,988,000 shares after distribution of the said bonus shares, with shares held by the first majority
shareholder accounting for 50.42% of the Company’s total shares.
In 1994, Jingzhou City and Sha City were combined and renamed as “Jingsha City”, Jiangling County as
“Jiangling District of Jingsha City”, and the Sha City Bureau for State-owned Assets Supervision and
Administration and the Jiangling County Bureau for State-owned Assets Supervision and Administration
(originally two shareholders of the Company) as “the Jingsha City Bureau for State-owned Assets Supervision and
Administration”. As such, the 50.42% and 1.93% equity interests of the Company formerly held by the Sha City
Bureau for State-owned Assets Supervision and Administration and the Jiangling County Bureau for State-owned
Assets Supervision and Administration respectively were transferred to the Jingsha City Bureau for State-owned
Assets Supervision and Administration, which held 52.35% of the Company’s total shares.
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
On 9 Aug. 1995, as approved at the Company’s 1994 Annual Shareholders’ General Meeting, the Jingsha City
Bureau for State-owned Assets Supervision and Administration transferred 3,002,700 shares it held in the
Company (2.14% of the Company’s total shares) to the Qichun County Bureau for State-owned Assets
Supervision and Administration. After the said transfer, the Jingsha City Bureau for State-owned Assets
Supervision and Administration (the Company’s first majority shareholder) held 50.21% of the Company’s total
shares.
In Jul. 1995, the Company held the 1994 Annual Shareholders’ General Meeting, at which a share allotment plan
(three shares being allotted for every ten shares) was reviewed and approved. After the said share allotment, the
Company’s total number of shares rose to 139,970,500, with the Jingsha City Bureau for State-owned Assets
Supervision and Administration holding 44.66%.
In Nov. 1996, as approved by the “Document Zheng-Jian-Shang-Zi [1996] No.13” issued by CSRC, the Company
carried out the share allotment plan (three shares being allotted for every ten shares) for the year 1996. A total of
41,991,100 shares of the Company were allotted, of which 19,552,900 shares were allotted for state-held shares
and 22,438,200 shares for individual-held shares. After the said share allotment, the Company’s total number of
shares rose to 181,969,600. And the shareholding ratio of every shareholder remained unchanged after the
allotment.
In 1996, pursuant to the “E-Zheng-Ban-Han [1995] No.92 Reply of People’s Government of Hubei Province on
Authorizing Sanonda Group to Operate State-owned Assets”, in order to safeguard the state-owned shares of the
Company held by it, the Jingsha City Bureau for State-owned Assets Supervision and Administration incorporated
Sanonda Group and transferred the Company’s equity interests it held to Sanonda Group. As such, Sanonda
Group became the Company’s first majority shareholder, holding 44.66% of the Company’s total shares.
From 29 Apr. to 5 May 1997, as approved by the “Zheng-Fa (1997) No.23 Document” issued by the Securities
Commission under the State Council, the Company issued 0.1 billion domestically-listed foreign shares (B shares)
of RMB 1.00 par value, which were listed in the Shenzhen Stock Exchange for trading on 15 May 1997. And the
Company exercised the over-allotment options of 15 million shares from 15 May to 21 May in the same year.
After issuance of the said B shares, the Company’s total number of shares rose to 296,961,600 shares, and the
shareholding ratio of Sanonda Group—the Company’s first majority shareholder—was changed to 27.52%.
On 20 May 2005, the Jingzhou City Bureau for State-owned Assets Supervision and Administration and China
National Agrochemical Corporation (a wholly-owned subsidiary under China National Chemical Corporation)
signed the “Agreement on Transferring Assets of Sanonda Group”. The State-Owned Assets Supervision and
Administration Commission of the People’s Government of Hubei Province issued the “E-Guo-Zi-Chan-Quan
[2005] No.177 Reply on Transferring State-owned Assets of Sanonda Group with Compensation”. As a result, the
People’s Government of Jingzhou City was approved to transfer all state-owned assets of Sanonda Group to China
National Agrochemical Corporation with compensation, with the transfer base date on 31 Dec. 2004. After the
said transfer, Sanonda Group became a wholly-owned subsidiary under China National Agrochemical
Corporation.
In 2006, pursuant to the “Guo-Zi-Chan-Quan [2006] No.767 Reply of State-owned Assets Supervision and
Administration Commission under the State Council on Affairs Related to Share Reform of Hubei Sanonda Co.,
Ltd.”, the “Share Reform Plan of Hubei Sanonda Co., Ltd.” was reviewed and approved at the shareholders’
general meeting held on 8 Jul. 2006. And the share reform was completed in Aug. 2006. With the base of
296,961,600 tradable shares, 2.2 shares were paid to tradable A-share holders by non-tradable share holders as
consideration for every 10 tradable A-shares, with the total number of shares paid by non-tradable share holders to
tradable share holders reaching 21,391,100,000 shares. After the share reform, the total number of the Company’s
shares remained unchanged, of which Sanonda Group held 61093,600 shares, accounting for 20.57% of the
Company’s total shares.
In Nov. 2006 and Mar. 2007, due to a dispute case concerning the provision of a loan guarantee by the Company’s
first majority shareholder—Sanonda Group—for an other company, 1.25 million and 0.40 million state-owned
corporate shares of the Company held by Sanonda Group were forcibly transferred and auctioned by the court.
After the auctions, shares of the Company held by Sanonda Group were reduced to 59,443,600 shares, accounting
for 20.02% of the Company’s total shares.
In May 2007, the Company held the 2006 Annual Shareholders’ General Meeting, at which the plan for turning
capital reserve to share capital was reviewed and approved. As a result, 10 shares were increased for every 10
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
shares held by all shareholders in Jul. 2007. After the increase, the Company’s total number of shares rose to
593,923,200 shares. The first majority shareholder—Sanonda Group—held 118,887,200 shares, accounting for
20.02% of the Company’s total shares. And for the period up to 30 Jun. 2012, the share capital of the Company
remained unchanged.
On 16 Nov. 2012, Sanonda Group Co., Ltd. acquired 800,000 shares of the Company held by the to-be-cancelled
subsidiary—Jingzhou Sanonda Advertising Co., Ltd. through the block trading market, then it held a total of
119,687,200 shares of the Company, accounting for 20.15% of the Company’s total share capital, and up to 30
Jun. 2014, the share capital of the Company remained unchanged.
In Apr. 2014, Sanonda Group Co., Ltd. was transformed from national ownership to limited liability
(solely-funded by one juridical person) and at the same time changed its name to “Jingzhou Sanonda Holdings Co.,
Ltd.”.
As at the balance sheet date, Legal representative of the Company: Li Zuorong; Registered address: No.93,
Beijing East Road, Jingzhou, Hubei Province, PRC; Stock abbreviation: Sanonda A/ Sanonda B; and Stock code:
000553/ 200553.
The Company and its subsidiaries (hereinafter referred to as “the Group”) is principally engaged in pesticide
products such as orthene, paraquate, glyphosate, trichlorphon, DDVP, triazophos, imidacloprid and carbofuran;
chemical products such as spermine, liquid caustic soda, liquefied chlorine gas and hydrochloric acid. The
Company has the rights of handling import and export business. And the Company has passed ISO9002 Quality
System Certification and ISO14001 Environment Management System Certification.
The parent company of the Group is Jingzhou Sanonda Holdings Co., Ltd. and the ultimate parent company is
China National Chemical Corporation.
The financial statements for the six months ended 30 Jun. 2014 have been authorized for issue by a resolution
made by the Board of Directors of the Group on 23 Jul. 2014.
IV. Main accounting policies and estimates and corrections of previous accounting errors
1. Basis for the preparation of financial statements
With the going-concern assumption as the basis and based on transactions and other events that actually occurred,
the Group prepared financial statements in accordance with the Basic Standard and 38 specific standards of
Accounting Standards for Business Enterprises issued by Ministry of Finance of the PRC on 15 February 2006,
Application Guidance of Accounting Standard for Business Enterprises, Interpretation of Accounting Standards
for Business Enterprises and other regulations issued thereafter (hereinafter referred to as “the Accounting
Standards for Business Enterprises”, “China Accounting Standards” or “CAS”), Rules for Preparation Convention
of Disclosure of Public Offering Companies No.15 – General Regulations for Financial Reporting (revised in
2010) by China Securities Regulatory Commission.
In accordance with relevant provisions of the Accounting Standards for Business Enterprises, the Group adopted
the accrual basis in accounting. Except for some financial instruments, where impairment occurred on an asset, an
impairment reserve was withdrawn accordingly pursuant to relevant requirements.
2. Statement of Compliance with the Accounting Standards for Business Enterprises
The financial statements prepared by the Group are in compliance with in compliance with the Accounting
Standards for Business Enterprises, which factually and completely present the Company’s and the Group’s
financial positions as at 30 Jun. 2014, business results and cash flows for the first half year of 2014, and other
relevant information. In addition, the Company’s and the Group’s financial statements meet the requirements of
disclosing financial statements and notes thereto stated in the Rules for Preparation Convention of Disclosure of
Public Offering Companies No.15 – General Regulations for Financial Reporting (revised in 2010) by China
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Securities Regulatory Commission.
3. Fiscal period
The Group’s fiscal periods include fiscal years and fiscal periods shorter than a complete fiscal year. The Group’s
fiscal year starts on 1 Jan. and ends on 31 Dec. of every year according to the Gregorian calendar. And the fiscal
period of the financial report is from 1 Jan. to 30 Jun..
4. Bookkeeping base currency
Renminbi is the dominant currency used in the economic circumstances where the Company and its domestic
subsidiaries are involved. Therefore, the Company and its domestic subsidiaries use Renminbi as their
bookkeeping base currency. And the Group adopted Renminbi as the bookkeeping base currency when preparing
the financial statements for the reporting period.
5. Accounting treatment methods for business combinations under the same control and those
not under the same control.
(1) Business combinations under the same control
A business combination under the same control is a business combination in which all of the combining
enterprises are ultimately controlled by the same party or the same parties both before and after the business
combination and on which the control is not temporary. In a business combination under the same control, the
party which obtains control of other combining enterprise(s) on the combining date is the combining party, the
other combining enterprise(s) is (are) the combined party. The “combining date” refers to the date on which the
combining party actually obtains control on the combined party.
The assets and liabilities that the combining party obtains in a business combination shall be measured on the
basis of their carrying amount in the combined party on the combining date. As for the balance between the
carrying amount of the net assets obtained by the combining party and the carrying amount of the consideration
paid by it (or the total par value of the shares issued), the additional paid-in capital (share premium) shall be
adjusted. If the additional paid-in capital (share premium) is not sufficient to be offset, the retained earnings shall
be adjusted.
The direct cost for the business combination of the combining party shall be recorded into the profits and losses at
the current period.
(2) Business combinations not under the same control
A business combination not under the same control is a business combination in which the combining enterprises
are not ultimately controlled by the same party or the same parties both before and after the business combination.
In a business combination not under the same control, the party which obtains the control on other combining
enterprise(s) on the purchase date is the acquirer, and other combining enterprise(s) is (are) the acquiree.
For a business combination not under the same control, the combination costs shall include the fair values, on the
acquisition date, of the assets paid, the liabilities incurred or assumed and the equity securities issued by the
acquirer in exchange for the control on the acquiree, the expenses for audit, legal services and assessment, and
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
other administrative expenses, which are recorded into the profits and losses in the current period. The trading
expenses for the equity securities or debt securities issued by the acquirer as the combination consideration shall
be recorded into the amount of initial measurement of the equity securities or debt securities. The involved
contingent consideration shall be recorded into the combination costs at its fair value on the acquiring date. Where
new or further evidences emerge, within 12 months since the acquiring date, against the existing circumstances on
the acquiring date and the contingent consideration thus needs to be adjusted, the combined goodwill shall be
adjusted accordingly. In a business combination realized by two or more transactions of exchange, in the Group’s
consolidated financial statements, as for the equity interests that the Group holds in the acquiree before the
acquiring date, they shall be re-measured according to their fair values at the acquiring date; the positive
difference between their fair values and carrying amounts shall be recorded into the investment gains for the
period including the acquiring date; other comprehensive gains in relation to the equity interests that the Group
holds in the acquiree before the acquiring date shall be transferred into investment gains in the current period; and
the combination costs shall be the summation of the fair values at the acquiring date of the equity interests that the
Group holds in the acquiree before the acquiring date and the fair values at the acquiring date of the equity
interests that Group increases in the acquiree on the acquiring date.
The combination costs of the acquirer and the identifiable net assets obtained by it in the combination shall be
measured according to their fair values at the acquiring date. The acquirer shall recognize the positive balance
between the combination costs and the fair value of the identifiable net assets it obtains from the acquiree as
business reputation. Where the combination costs are less then the fair value of the identifiable net assets it obtains
from the acquiree, the acquirer shall re-examine the measurement of the fair values of the identifiable assets,
liabilities and contingent liabilities it obtains from the acquiree as well as the combination costs. If, after the
reexamination, the combination costs are still less than the fair value of the identifiable net assets it obtains from
the acquiree, the acquirer shall record the balance into the profits and losses of the current period.
As for the deductible temporary differences the acquirer obtains from the acquiree which are not recognized into
deferred income tax liabilities due to their not meeting the recognition standards, if new or further information
shows that the relevant situation has existed on the acquiring date and the economic benefits brought by the
deductible temporary differences the acquirer obtains from the acquiree on the acquiring date can be realized, they
shall be recognized into deferred income tax assets and the relevant goodwill shall be reduced. Where the
goodwill is not sufficient to be offset, the difference shall be recognized into the profits and losses in the current
period. In other circumstances than the above, where the deductible temporary differences are recognized into
deferred income tax assets on the acquiring date, they shall be recorded into the profits and losses in the current
period.
6. Specific accounting policy in regard to disposing equity step by step till the cease of control
(inapplicable)
7. Methods for preparing consolidated financial statements
(1) Preparation methods for consolidated financial statements
1) Principle for determining the consolidation scope
The consolidation scope for financial statements is determined on the basis of control. The term “control” is the
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
power of the Company to determine financial and business policies of an investee and obtain benefits from the
investee’s operating activities. The consolidated financial statements comprise the financial statements of the
Company and its subsidiaries. A subsidiary is an enterprise or entity controlled by the Company.
2) Methods for preparing the consolidated financial statements
Subsidiaries are fully consolidated from the date on which the Group obtains control on their net assets and
operation decision-making and are de-consolidated from the date when such control ceases. As for a disposed
subsidiary, its operating results and cash flows before the disposal date has been appropriately included in the
consolidated income statement and cash flow statement; and as for subsidiaries disposed in the current period, the
opening items in the consolidated balance sheet are not adjusted. For a subsidiary acquired in a business
combination not under the same control, its operating results and cash flows after the acquiring date have been
appropriately included in the consolidated income statement and cash flow statement, and the opening items and
comparative items in the consolidated financial statements are not adjusted. For a subsidiary acquired in a
business combination under the same control or a combined party obtained in a takeover, its operating results and
cash flows from the beginning of the reporting period of the combination to the combination date have been
appropriately included in the consolidated income statement and cash flow statement, and the comparative items
in the consolidated financial statements are adjusted at the same time.
The financial statements of subsidiaries are adjusted in accordance with the accounting policies and accounting
period of the Company during the preparation of the consolidated financial statements, where the accounting
policies and the accounting periods are inconsistent between the Company and subsidiaries. For a subsidiary
acquired from a business combination not under the same control, the individual financial statements of the
subsidiary are adjusted based on the fair value of the identifiable net assets at the acquisition date.
All significant inter-group balances, transactions and unrealized profits are offset in the consolidated financial
statements.
The portion of a subsidiary’s shareholders’ equity and the portion of a subsidiary’s net profits and losses for the
period not held by the Company are recognized as minority interests and minority shareholder profits and losses
respectively and presented separately under shareholders’ equity and net profits in the consolidation financial
statements. The portion of a subsidiary’s net profits and losses for the period that belong to minority interests is
presented as the item of “minority shareholder profits and losses” under the bigger item of net profits in the
consolidated financial statements. Where the loss of a subsidiary shared by minority shareholders exceeds the
portion enjoyed by minority shareholders in the subsidiary’s opening owners’ equity, minority interests are offset.
Where the Company losses control on its original subsidiaries due to disposal of some equity investments or other
reasons, the residual equity interests are re-measured according to the fair value on the date when such control
ceases. The summation of the consideration obtained from the disposal of equity interests and the fair value of the
residual equity interests, minus the portion in the original subsidiary’s net assets measured on a continuous basis
from the acquisition date that is enjoyable by the Company according to the original shareholding percentage in
the subsidiary, is recorded in investment gains for the period when the Company’s control on the subsidiary
ceases. Other comprehensive incomes in relation to the equity investment in the original subsidiary are transferred
to investment gains for the period when such control ceases. And subsequent measurement is conducted on the
residual equity interests according to the No.2 Accounting Standard for Business Enterprises —Long-term Equity
Investments or the No.22 Accounting Standard for Business Enterprises—Recognition and Measurement of
Financial Instruments.
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
(2) As for the event about purchasing and then selling (or selling and then purchasing) equities of
the same subsidiary, the Company shall disclose relevant accounting treatment methods.
Inapplicable
8. Recognition standard for cash and cash equivalents
In the Group’s understanding, cash and cash equivalents include cash on hand, any deposit that can be used for
cover, and short-term (usually due within 3 months since the day of purchase) and high circulating investments,
which are easily convertible into known amount of cash and whose risks in change of value are minimal.
9. Foreign currency businesses and translation of foreign currency financial statements
(1) Foreign currency
1) Accounting treatments for translation of foreign currency transactions
As for a foreign currency transaction, the Company shall convert the amount in a foreign currency into amount in
its bookkeeping base at the spot exchange rate of the transaction date, while as for such transactions as foreign
exchange or involving in foreign exchange, the Company shall converted into amount in the bookkeeping base
currency at actual exchange rate the transaction is occurred.
(2) Accounting treatments for translation of foreign currency monetary items and non-monetary
items
On the balance sheet date, the foreign currency monetary items shall be translated at the spot exchange rate on the
balance sheet date. The exchange difference arising from the difference between the spot exchange rate on the
balance sheet date and the spot exchange rate at the time of initial recognition or prior to the balance sheet date
shall be recorded in the profits and losses in the current period, excluding the following situations:
① the exchange difference arising from foreign currency loans related to acquisition of fixed assets shall be
treated at the principle of capitalization of borrowing costs;
② the exchange difference arising from change in the book balance of foreign currency monetary items available
for sale except the amortized costs shall be recorded into other comprehensive gains and losses.
A foreign currency non-monetary item measured at the historical costs shall still be translated at the spot exchange
rate on the transaction date. Where the foreign nonmonetary items measured at the fair value shall be converted
into amount in its bookkeeping base currency at spot exchange rate, the exchange gains and losses arising thereof
shall be treated as change in fair value, and recorded into the current period gains and losses or as other
comprehensive gains and losses and recorded into capital reserves.
(2) Translation of foreign currency financial statements
When it involves overseas business in preparing the consolidated financial statement, for the translation difference
of foreign currency monetary items of net investment in overseas business arising from the change in exchange
rate, it shall be recorded into the item of “difference of foreign currency financial statement translation” under the
owners’ equity; and be recorded into disposal gains and losses at current period when disposing overseas business.
The foreign currency financial statement of overseas business should be translated in to RMB financial statement
by the following methods: The asset and liability items in the balance sheets shall be translated at a spot exchange
rate on the balance sheet date. Among the owner’s equity items, except for the items as “undistributed profits”,
other items shall be translated at the spot exchange rate at the time when they are incurred. The income and
expense items in the profit statements shall be translated at the spot exchange rate of the transaction date. The
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
undistributed profits at year-begin is the undistributed profits at the end of last year after the translation;
undistributed profits at year-end shall be listed as various distribution items after the translation; after the
translation, the balance between assets and the sum of liabilities and owners’ equities shall be recorded into other
comprehensive gains and losses as difference of foreign currency translation, and individually listed under the
item of owners’ equity in the balance sheet. Where an enterprise disposes of an overseas business without the
control right, it shall shift the differences, which is presented under the items of the owner’s equities in the
balance sheet and which arises from the translation of foreign currency financial statements relating to this
overseas business, into the disposal profits and losses of the current period by all or proportion of the disposed
overseas business.
Foreign cash flow shall be translated at the spot exchange rate of the date of cash flow incurred. The influence of
exchange rate on the cash flow shall be adjustment item and individually listed in the cash flow statement.
And the opening balance and the actual balance of last year shall be listed at the amounts after translation of
foreign currency financial statement in last year.
10. Financial instruments
The term "financial instruments" refers to the contracts under which the financial assets of an enterprise are
formed and the financial liability or right instruments of any other entity are formed.
(1) Classification of financial assets
Financial assets shall be classified into the following four categories when they are initially recognized: (a) the
financial assets which are measured at their fair values and the variation of which is recorded into the profits and
losses of the current period, (b) the investments which will be held to their maturity; (c) loans and the account
receivables; and (d) financial assets available for sale.
(2) Recognition basis and measurements for financial instruments
① The financial assets which are measured at their fair values and the variation of which is recorded into the
profits and losses of the current period
Including transactional financial assets and the financial assets which are designated to be measured at their fair
value when they are initially recognized and of which the variation is recorded into the profits and losses of the
current period;
The financial assets meeting any of the following requirements shall be classified as transactional financial assets：
A. The purpose to acquire the said financial assets is mainly for selling them in the near future; B. Forming a part
of the identifiable combination of financial instruments which are managed in a centralized way and for which
there are objective evidences proving that the enterprise may manage the combination by way of short-term profit
making in the near future; C. Being a derivative instrument, excluding the designated derivative instruments
which are effective hedging instruments, or derivative instruments to financial guarantee contracts, and the
derivative instruments which are connected with the equity instrument investments for which there is no quoted
price in the active market, whose fair value cannot be reliably measured, and which shall be settled by delivering
the said equity instruments.
The financial assets meeting any of the following requirements shall be designated as financial assets which are
measured at their fair values and the variation of which is recorded into the profits and losses of the current period
for initial recognition: A. the designation can eliminate or significantly reduce the difference of relevant gains and
losses between recognition and measurement causing from different bases for measurement of financial assets; B.
The official written documents for risk management and investment strategies of the enterprise have clearly stated
that it shall ,manage, evaluate and report to important management personnel based on the fair value, about the
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
financial assets group or the group of financial assets & liabilities which the financial assets are belong to.
For the financial assets which are measured at their fair values and the variation of which is recorded into the
profits and losses of the current period shall continue to be measured by fair value, gains and losses of change in
fair value, dividends and interest related with these financial assets should be recorded into gains and losses of
current period.
② Held-to-maturity investment
The term "held-to-maturity investment" refers to a non-derivative financial asset with a fixed date of maturity, a
fixed or determinable amount of repo price and which the enterprise holds for a definite purpose or the enterprise
is able to hold until its maturity.
For the held-to-maturity investment adopting actual interest rate method, which is measured at the
post-amortization costs, the profits and losses that arise when such financial assets or financial liabilities are
terminated from recognition, or are impaired or amortized, shall be recorded into the profits and losses of the
current period.
The actual interest rate method refers to the method by which the post-amortization costs and the interest incomes
of different installments or interest expenses are calculated in light of the actual interest rates of the financial
assets or financial liabilities (including a set of financial assets or financial liabilities). The actual interest rate
refers to the interest rate adopted to cash the future cash flow of a financial asset or financial liability within the
predicted term of existence or within a shorter applicable term into the current carrying amount of the financial
asset or financial liability.
When the actual interest rate is determined, the future cash flow shall be predicted on the basis of taking into
account all the contractual provisions concerning the financial asset or financial liability (the future credit losses
shall not be taken into account).and also the various fee charges, trading expenses, premiums or reduced values,
etc., which are paid or collected by the parties to a financial asset or financial liability contract and which form a
part of the actual interest rate.
③ Loans and the accounts receivables
Loans and the accounts receivables refer to non-derivative financial assets, which there is no quotation in the
active market, with fixed recovery cost or recognizable. Financial assets that are defined as loans and the accounts
receivables by the Group including notes receivables, accounts receivables, interest receivable, dividends
receivable and other receivables etc..
Loans and the accounts receivables are made follow-up measurement on the basis of post-amortization costs
employing the effective interest method. Gains or loss arising from the termination recognition, impairment
occurs or amortization shall be recorded into the profits and losses of the current period.
④ Assets available for sales
Assets available for sales including non-derivative financial asset that has been assigned as assets available for
sales on the initial recognition and financial assets excluded those measured at fair value and of which the
variation into profits and losses of the current period, they are some financial assets, loans and accounts
receivables, held-to-maturity investment.
The Group shall make follow-up measurement to assets available for sales employing fair value. Gains or loss in
fair value changes deducted impairment loss and relevant exchange difference from monetary financial assets of
foreign currency and amortized cost shall be recorded into the profits and losses of the current period, and shall be
recorded into capital reserves as other comprehensive income and be carried forward when the said financial
assets stopped recognition, then it shall be recorded into the profits and losses of the current period.
Interest receive during the holding of assets available for sales and cash dividends with distribution announcement
by invested companies, it shall be recorded into the profits and losses of the current period.
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
(3) Recognition basis and measurement of financial asset transfers
Financial asset that satisfies one of the following conditions, its recognition shall be stopped: (a) the contracted
right of receiving cash flow of the said financial assets ceases, and (b) the said financial assets is transferred and
nearly all of the risks and rewards related to the ownership is transferred into the carrying party, and (c) the said
asset is transferred, though the corporate neither transferred, no retain nearly all of the risks and rewards related to
the ownership, it gives up the control of the said asset.
If the corporate neither transferred, no retain nearly all of the risks and rewards related to the ownership and it
does not give up the control of the said financial asset, then the recognition of relevant asset is recorded according
to the extent of its continuous involvement in the transferred financial asset. The extent of its continuous
involvement in the transferred financial asset refers to the risk the corporate come across with the change in the
value of financial asset.
If the transfer of an entire financial asset satisfies the conditions for stopping recognition, the book value of the
transferred financial asset and the sum of consideration received from the transfer, and the accumulative amount
of the changes of the fair value originally recorded in the owner's equities shall be recorded in the profits and
losses of the current period.
If the transfer of partial financial asset satisfies the conditions to stop the recognition, the entire book value of the
transferred financial asset shall, between the portion whose recognition has been stopped and the portion whose
recognition has not been stopped, be apportioned according to their respective relative fair value, and the book
value of the portion whose recognition has been stopped and he sum of consideration of the portion whose
recognition has been stopped, and the portion of the accumulative amount of the changes in the fair value
originally recorded in the owner's equities which are corresponding to the portion whose recognition has been
stopped shall be included into the profits and losses of the current period.
(4) Termination of recognition of financial liabilities
Only when the prevailing obligations of a financial liability are relieved in all or in part may the recognition of the
financial liability be terminated in all or partly. Where the Group enters into an agreement with a creditor so as to
substitute the existing financial liabilities by way of any new financial liability, and if the contractual stipulations
regarding the new financial liability is substantially different from that regarding the existing financial liability, it
shall terminate the recognition of the existing financial liability, and shall at the same time recognize the new
financial liability.
Where the recognition of a financial liability is totally or partially terminated, the Group shall include into the
profits and losses of the current period the gap between the carrying amount which has been terminated from
recognition and the considerations it has paid (including the non-cash assets it has transferred out and the new
financial liabilities it has assumed).
(5) Determination of the fair value of main financial assets and financial liabilities
Fair value refers to the price that both parties who are familiar with the situation are willing to exchange assets or
reimburse liabilities. As for the financial assets or financial liabilities for which there is an active market, the
quoted prices in the active market shall be used to determine the fair values thereof. The quoted prices in the
active market refers to the prices available from stock exchange, broker’s agencies, guilds, pricing organization
and etc., which represent the actual trading price under equal transaction. Where there is no active market for a
financial instrument, the enterprise concerned shall adopt value appraisal techniques, including the prices adopted
by the parties, who are familiar with the condition, in the latest market transaction upon their own free will, the
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current fair value obtained by referring to other financial instruments of the same essential nature, the cash flow
capitalization method and the option pricing model, etc., to determine its fair value.
(6) Methods for impairment test and withdrawal of impairment provision for financial assets
(excluding accounts receivable)
Except for financial assets that shall be recoded into profits and losses of the current period by measuring at fair
value and variations, the Group shall carry out impairment test, on all balance sheet days, to book value of other
financial assets, where there are objective evidences proving that a financial asset has been impaired, make
provision for impairment for such financial asset.
Where a financial asset measured on the basis of post-amortization costs is impaired, it shall withdraw the
impairment provision by the balance of the current value of the predicted future cash flow (excluding the loss of
future credits not yet occurred) less than the carrying amount of the said financial asset. If there is any objective
evidence proving that the value of the said financial asset has been restored, and it is objectively related to the
events that occur after such loss is recognized, the impairment-related losses as originally recognized shall be
reversed and be recorded into the profits and losses of the current period.
If there is any objective evidence proving that a sellable financial asset is impaired, the accumulative losses
arising from the decrease of the fair value of the owner’s equity which was directly included shall be transferred
out and recorded into the impairment losses of the current period. As for the sellable debt instruments whose
impairment-related losses have been recognized, if, within the accounting period thereafter, the fair value has risen
and are objectively related to the subsequent events that occur after the originally impairment-related losses were
recognized, the originally recognized impairment-related losses shall be reversed and be recorded into the profits
and losses of the current period. As for the sellable equity instrument investment whose impairment-related losses
have been recognized, the increase in fair value after balance sheet date shall be directly recorded into
shareholders’ equity.
Impairment recognition standards for available-for-sale financial assets
(7) As for event about reclassifying the undue held-to-maturity investment into available-for-sale
financial assets, the Company shall state the basis of changes in holding purpose or ability
Inapplicable
11. Recognition criteria and withdrawal methods for bad debts provision of accounts
receivable
The Group shall carry out an inspection, on the balance sheet day, on the carrying amount of receivables. Where
there is any objective evidence proving that such receivable has been impaired, an impairment provision shall be
made: ① A serious financial difficulty occurs to the debtor; ② The debtor breaches any of the contractual
stipulations, for example, fails to pay or delays the payment of interests or the principal, etc.; ③ The debtor will
probably become bankrupt or carry out other financial reorganizations; ④ Other objective evidences indicating
that such receivable has been impaired.
(1) Bad debt provision for individually significant accounts receivable
The Company defines an account receivable equivalent to or
Judgement basis or monetary standards of provision for bad debts of
above RMB 5 million as an account receivable which is
the individually significant accounts receivable
individually significant.
Method of individual provision for bad debts of the individually The Company shall carry out an independent impairment test
significant accounts receivable on an account receivable which is individually significant.
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For a financial asset that is proved to have no signs of
impairment after the independent impairment test, the
Company shall put it into the financial asset group that has
the similar credit risk and carry out an impairment test on the
group as a whole. For an account receivable that is proved in
the independent impairment test to have been impaired, the
Company shall not put it into the financial asset group that
has the similar credit risk and carry out an impairment test on
the group as a whole.
(2) Accounts receivable for which bad debt provisions are made on the group basis
Withdrawal method of bad
Name of group debt provision on the group Recognition basis of group
basis
Account age groups Aging analysis method Divided according to ages of accounts receivable.
Divided according to the related-party relation between the
Related-party groups Other method debtor and the Company (usually the Company’s actual
controller and other enterprises controlled by it)
Divided according to the debtor’s reputation, the nature of the
account, safeguard measures, etc. (usually amounts due from the
Risk-free groups Other method government for purchases, reserve funds for employees, deposits
for contracts, accounts receivable arising from guarantee terms,
etc.)
In the groups, adopting aging analysis method to withdraw bad debt provision:
√ Applicable □ Inapplicable
Withdrawal proportion for accounts Withdrawal proportion for other accounts receivable
Age
receivable (%) (%)
Within 1 year (including 1 year) 5.00% 5.00%
1-2 years 10.00% 10.00%
2-3 years 30.00% 30.00%
3-4 years 50.00% 50.00%
4-5 years 50.00% 50.00%
Over 5 years 100.00% 100.00%
In the groups, adopting balance percentage method to withdraw bad debt provision
□ Applicable √ Inapplicable
In the groups, adopting other methods to withdraw bad debt provision
√ Applicable □ Inapplicable
Name of group Notes of method
Accounts receivable between the parent company and its subsidiaries
Related-party groups
included into the consolidated scope are not withdrawn the bad debt
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provisions.
Bad debt provisions are made according to the specific identification
Risk-free groups
method.
(3) Accounts receivable with an insignificant single amount but for which the bad debt provision is
made individually
The Group carries out an independent impairment test on an account receivable
which is individually insignificant but has the following feature (for instance,
Reason of individually withdrawing bad debt
receivables over which there exist disputes against the opposite parties or receivables
provision
concerning lawsuits and arbitrations; and receivables of which there are obvious
signs indicating that debtors may not be able to fulfill repayment obligations).
The Group carries out an independent impairment test on an account receivable
which is individually insignificant but has the following feature. If there is any
objective evidence proving that the asset has been impaired (for instance, receivables
over which there exist disputes against the opposite parties or receivables concerning
Withdrawal method for bad debt provision
lawsuits and arbitrations; and receivables of which there are obvious signs indicating
that debtors may not be able to fulfill repayment obligations), the Group recognizes
impairment loss and makes bad-debt provisions according to the difference between
the present value of the asset’s future cash flow and the asset’s book value.
12. Inventory
(1) Classification
The inventories of the Group include raw materials, goods in process, merchandise on hand, packaging materials,
and low value consumables, etc.
(2) Pricing method for outgoing inventories
Pricing method: Weighted average method
Bulk chemical raw materials, goods in process and finished products shall be priced at actual cost, while cost of
sending out inventories shall be carried forward at the weighted average method. Auxiliary material and
packaging materials shall be priced at actual cost and be measured by adopting planned cost; the difference
between the actual cost and planned cost shall be recorded into materials cost variance when measurement, which
materials cost variance allocable thereto shall be calculated based on materials cost difference rate at the end of
month, and the planned cost of sending out materials shall be adjusted as actual cost.
(3) Recognition basis of net realizable value and withdrawal method of depreciation reserves for
inventories
Inventories shall be measured whichever is lower in accordance with the cost and the net realizable value at the
period-end. If the cost of inventories is higher than the net realizable value, the provision for the loss on decline in
value of inventories shall be made and be included in the current profits and losses. If the factors causing any
write-down of the inventories have disappeared, the amount of write-down shall be resumed and be reversed from
the provision for the loss on decline in value of inventories that has been made. The reverse amount shall be
included in the current profits and losses. The net realizable value refers to in the daily business activity the
amount after deducting the estimated cost of completion, estimated sale expense and relevant taxes from the
estimated sale price of inventories.
(4) Inventory system for inventories:
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Inventory system: Perpetual inventory system
The inventory system for inventories is perpetual inventory system.
(5) Amortization method of the low-value consumption goods and packing articles
Low-value consumption goods
Amortisation method: one-off amortization method
Low value consumables shall be recoded at actual cost and be amortized by employing the one-off amortization
method when claiming.
Packing articles
Amortisation method: other
Packaging materials shall be priced at actual cost and be measured by adopting planned cost; the difference
between the actual cost and planned cost shall be recorded into materials cost variance when measurement, which
materials cost variance allocable thereto shall be calculated based on materials cost difference rate at the end of
month, and the planned cost of sending out materials shall be adjusted as actual cost.
13. Long-term equity investments
(1) Recognition of investment costs
As for long-term equity investments acquired by enterprise merger, if the merger is under the same control, the
share of the book value of the owner’s equity of the merged enterprise, on the date of merger, is regarded as the
initial cost of the long-term equity investment, and if the merger is not under the same control, the sum of paid
assets, occurred or assumed liabilities, and issued equity securities by the purchasing party are included into costs
of enterprise merger. Intermediary expenses, such as the expenses for audit, assessment, and legal services, along
with other relevant administration fee, shall be recorded into the profits and losses of the current period.
Transaction costs arising from the issuance of equity securities or debt securities as merger consideration of the
purchasing party shall be recorded into the initially recognized amount of equity securities or debt securities.
Other equity investments, except for the aforesaid long-term equity investments acquired by enterprises merger,
are initially measured according to costs, which can, in consideration of different ways to obtain long-term equity
investments, be respectively recognized by amount of cash payment actually paid by the Group, fair value of
equity securities issued by the Group, value agreed upon investment contracts or investment agreements, fair
value or original book value of surrendered assets in transactions of non-currency assets, and fair value of the
long-term equity investment itself. Costs, taxes and other necessary expenses directly relevant to the acquirement
of long-term equity investments are also recorded onto investment costs.
(2) Subsequent measurement and recognition method of gains and losses
For the long-term equity investments which the Company have no joint control or significant influence over
invested entities, and there is no offer in the active market and the fair value cannot be reliably measured, shall be
accounted by cost method. Long-term equity investments with joint control or significant influence over invested
entities shall be accounted by equity method. Long-term equity investments, which have no control, joint control
or significant influence over invested entities, nevertheless of which the fair value can be reliably measured, shall
be accounted as financial assets available for sale or financial assets recognized with the fair value and the change
recognized in current gains and losses.
Besides, long-term equity investments that can implement control over invested entities are accounted by cost
method in financial statements of the Company.
① Long-term equity investments accounted by cost method
With the employment of cost method, long-term equity investments shall be valuated on the basis of initial
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investment cost. Current investment income, except for actually paid amount during the investment, and cash
dividends or profits that have been declared but not yet been granted included in the consideration, shall be
ascertained in accordance with enjoyed cash dividends or profits declared and granted by invested entities.
② Long-term equity investments accounted by equity method
With the employment of equity method, the initial investment cost of long-term equity investment shall not be
adjusted if the initial investment cost of long-term equity investment exceeds the share, which should be enjoyed,
of fair value of identifiable net assets of invested entities. Cost of long-term equity investment shall be adjusted if
the initial investment cost is less than the share, which should be enjoyed, of fair value of identifiable net assets of
invested entities, and the balance between the two shall be recorded into profit or loss in the period in which it is
incurred.
With the employment of equity method, profit or loss in the period in which it is incurred is the share, which
should be enjoyed or shared, of net gains and losses realized by invested entities in the current year. When
recognizing the share, which should be enjoyed, of net gains and losses of invested entities, the recognition shall
be implemented on the basis of fair value of all identifiable assets of invested entities during the investment and
after the adjustment of net profit of invested entities during the account period with the accordance of accounting
policies of the Group. As for gains and losses of unrealized internal transactions among associated enterprises,
contractual enterprises and the Group, the part belonging to the Group after calculating by shareholding
proportion shall be offset, and the investment gains and losses shall be thus recognized on that basis. Nevertheless,
losses, which belong to impairment losses of transferred assets in line with provisions stipulated in the Accounting
Standards for Enterprises No. 8 - Asset Impairment, of realized internal transactions between invested entities and
the Group shall not be offset. As for other integrated incomes of invested entities, the book value of long-term
equity investments shall be correspondently adjusted and recognized as other investment incomes，which shall
thus be recorded into capital reserves.
When recognizing the incurred net losses, which should be shared, of invested entities, the limit shall be the
down-to-zero amount of write-down of book value of long-term equity investments and other long-term equity
essentially forming net investment over invested entities. Besides, if the Group has any liability of undertaking
extra losses over invested entities, then the estimated debts shall be recognized in compliance with projected
undertaken duties and recorded into gains and losses of investment at the current period. If the invested entity
realized net profits in subsequent period, then the Group shall resume recognition of the shared amount of
incomes after making up unrecognized shared amount of losses with the shared amount incomes.
For the long-term equity investment on joint venture and associate held by the Company before initially adopting
the new accounting standard on 1 Jan. 2008, if there is debit balance of equity investment relevant to such
investment, which shall be recognized into profit or loss in the period in which it is incurred with the amortised
amount by straight-line method during the remaining period.
③ Acquisition of minority equity
During the preparation of consolidated financial statements, capital reserves shall be adjusted in light of balance
between long-term equity investments, which are newly increased because of the purchase of minority stakes, and
the share of net assets of subsidiaries, which should be enjoyed and has been sustainably calculated since the
acquisition date (or merger date) in accordance with newly increased shareholding proportion. Retained earnings
shall be adjusted if capital reserves are insufficient to dilute.
④ Disposal of long-term equity investments
In consolidated financial statements, under the circumstance of keeping control power, the parent company shall
partially dispose long-term equity investments, and the balance between the disposed price and the enjoyed net
assets of subsidiaries correspondent to disposed long-term equity investment shall be recorded into owners’ equity.
If the partial disposal of parent company over long-term equity investments of subsidiaries results in the loss of
control over subsidiaries, in that circumstance, it shall be managed according to relevant accounting policies
stated in the Preparation Method of Consolidated Financial Statements in Note IV. 4. (2).
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As for disposal of long-term equity investment under other circumstances, the balance between book value of
disposed equity and its actually acquired price shall be included into profit or loss in the period in which it is
incurred. As for long-term equity investments with the employment of equity method, other part of integrated
incomes originally included in owners’ equity shall be transferred to profit or loss in the period in which it is
incurred in accordance with correspondent proportion during the disposal. As for residual equity, it shall be
recognized as long-term equity investments or other relevant financial assets according to the book value, and
shall be subsequently measured according to accounting policies of the aforesaid long-term equity investments or
financial assets. Residual equity concerning accounting method transferred from cost method to equity method
shall be retrospectively restated and adjusted.
(3) Recognition basis for joint control and significant influence over invested entities
The term "control" means having the power to decide an enterprise's financial and operating policy and obtain
benefits from its business activities. The term "joint control" refers to the control over an economic activity in
accordance with the contracts and agreements, which does not exist unless the investing parties of the economic
activity with one an assent on sharing the control power over the relevant important financial and operating
decisions. The term "significant influences" refers to the power to participate in making decisions on the financial
and operating policies of an enterprise, but not to control or do joint control together with other parties over the
formulation of these policies. When ascertaining whether or not it is able to control or have significant influences
on an invested entity, potential factors concerning the voting rights, such as investing enterprises, current
convertible corporate bonds, and current executable warrants of invested entities etc. have been taken into full
consideration.
(4) Impairment test method and withdrawal method of impairment provision
The Group shall check out whether there is any sign of impairment of long-term equity investments on each
balance sheet date. Where any evidence shows that there is possible assets impairment, the recoverable amount of
the assets shall be estimated. If the recoverable amount of the asset is less than its book value, then asset
impairment provision will be withdrawn in line with the balance and recorded into profit or loss in the period in
which it is incurred.
Once the impairment losses of long-term equity investments are recognized, they can’t be reversed during the
subsequent accounting period.
14. Investment real estates
The term "investment real estates" refers to the real estate held for generating rent and/or capital appreciation.
Investment real estates of the Group include the right to use any land which has already been rented; the right to
use any land which is held and prepared for transfer after appreciation; and the right to use any building which has
already been rented.
The initial measurement of the investment real estate shall be made at its cost. Subsequent expenditures incurred
for an investment real estate is included in the cost of the investment real estate when it is probable that economic
benefits associated with the investment real estate will flow to the Group and the cost can be reliably measured,
otherwise the expenditure is recognised in profit or loss in the period in which they are incurred.
The Group shall make a follow-up measurement to the investment real estates by employing the cost pattern on
the date of the balance sheet. An accrual depreciation or amortization shall be made for the investment real estates
in the light of the accounting policies of the use right of buildings or lands.
As for impairment test method and withdrawal method of impairment provision of investment real estates, the
Group shall judge whether there is sign of impairment on the balance sheet date. Where any evidence shows that
there is possible assets impairment, the recoverable amount of the assets shall be estimated. When impairment test
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result shows that the recoverable amount of the asset is lower than its book value, impairment provision shall be
withdrawn in accordance with the balance and recorded into impairment loss.
When owner-occupied real estate or inventories are changed into investment real estate or investment real estate is
changed into owner-occupied real estate, whose book value prior to the change shall be the entry value after the
change?
When an investment real estate is changed to an owner-occupied real estate, it is transferred to fixed assets or
intangible assets at the date of such change. When an owner-occupied real estate is changed to be held to earn
rental or for capital appreciation, the fixed asset or intangible asset is transferred to investment real estate at the
date of such change. If the fixed asset or intangible asset is changed into investment real estate measured by
adopting the cost pattern, whose book value prior to the change shall be the entry value after the change; if the
fixed asset or intangible asset is changed into investment real estate measured by adopting the fair value pattern,
whose fair value on the date of such change shall be the entry value after the change
An investment real estate is derecognised on disposal or when the investment real estate is permanently
withdrawn from use and no future economic benefits are expected from its disposal. The amount of proceeds on
sale, transfer, retirement or damage of an investment real estate less its carrying amount and related taxes and
expenses is recognised in profit or loss in the period in which it is incurred.
15. Fixed assets
(1) Conditions for recognition of fixed assets
The term "fixed assets" refers to the tangible assets that simultaneously possess the features as follows: (a) they
are held for the sake of producing commodities, rendering labor service, renting or business management; and (b)
their useful life is in excess of one fiscal year. A fixed asset can only be recognized when the following conditions
are both satisfied: (a) the economic benefits in relation to the fixed asset are very likely to flow into the enterprise;
and (b) the cost of the fixed asset can be measured reliably.
(2) Recognition basis and pricing method for fixed assets gained from finance lease
The "finance lease" shall refer to a lease that has transferred in substance all the risks and rewards related to the
ownership of an asset. The ownership of it may or may not eventually be transferred. In calculating the
depreciation of an asset gained from finance lease, the lessee should adopt the depreciation policy for the fixed
assets which are owned by the lessee. If it is reasonable to be certain that the lessee will obtain the ownership of
the leased asset when the lease term expires, the leased asset shall be fully depreciated over its useful life. If it is
not reasonable to be certain that the lessee will obtain the ownership of the leased asset at the expiry of the lease
term, the leased asset shall be fully depreciated over the shorter one of the lease term or its useful life.
(3) Depreciation methods for various fixed assets
The initial measurement of a fixed asset shall be made at its cost with the consideration of the effect of expected
discard expenses. From the next month of bringing the fixed asset to the expected conditions for use, it shall be
made the depreciation by adopting the straight-line method during its useful life. The useful life, expected net
salvage value and annual depreciation ratio of various fixed assets are as follows:
The categories Estimated useful life (years) Residual value (%) Annual depreciation rate (%)
Houses and buildings 15-24 2%-4% 4--6.53
Machinery 3-15 2%-4% 6.4--32.67
Electronic devices 9-18 4.00% 5.33--10.67
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Vehicles 9 2.00% 10.89
(4) Testing method of impairment and withdrawal method of provision for impairment on fixed
assets
The Group shall judge whether there is sign of impairment on the balance sheet date. Where any evidence shows
that there is possible assets impairment, the Group shall estimate the recoverable amount of the assets and make
relevant impairment test.
When impairment test result shows that the recoverable amount of the asset is lower than its book value,
impairment provision shall be withdrawn in accordance with the balance and recorded into impairment loss. The
recoverable amount shall be determined on the basis of the higher one of the net amount of the fair value of the
asset minus the disposal expenses and the current value of the expected future cash flow of the asset. Fair value of
the asset shall be determined in light of the price as stipulated in the sales agreement in the fair transaction. Where
there is no sales agreement but there is an active market of assets, the fair value shall be determined according to
the price bidden by the buyer of the asset. Where there is no sales agreement and no active market of assets, the
fair value shall be estimated in light of the best information available. The disposal expenses shall include the
relevant legal expenses, relevant taxes, truckage as well as the direct expenses for bringing the assets into a
marketable state. The current value of the expected future cash flow of an asset shall be determined by the
discounted cash with an appropriate discount rate, on the basis of the expected future cash flow generated during
the continuous use or final disposal of an asset. Impairment provision of the asset shall be calculated and
determined on the basis of single item asset. Where it is difficult to do so, the enterprise shall determine the
recoverable amount of the group assets on the basis of the asset group to which the asset belongs. The term "group
assets” refers to a minimum combination of assets that can independently generate the flow-in cash.
Once the impairment losses of the aforesaid assets are recognized, they can’t be reversed during the subsequent
accounting period.
(5) Other explanations
Subsequent expenditures incurred for a fixed asset are included in the cost of the fixed asset when it is probable
that economic benefits associated with the fixed asset will flow to the Group and its cost can be reliably measured.
The carrying amount of those parts that are replaced is derecognized and all other subsequent expenditures are
recognised in profit or loss in the period in which it is incurred.
The amount of proceeds on sale, transfer, retirement or damage of a fixed asset net less its carrying amount and
related taxes and expenses is recognised in profit or loss in the period in which it is incurred.
The Group will check the useful life, expected net salvage value and depreciation method of fixed assets at least at
the end of year, and there is any change, the change will be treated as the change of accounting estimation.
16. Construction in progress
(1) Categories of construction in progress
Construction in progress of the Group includes self-operating project and construction contracted.
(2) Criteria and time point of construction in progress being carried forward as fixed assets
Time point of construction in progress being carried forward as fixed assets shall be recognized at the time point
that the construction reaches estimated usable status.
(3) Impairment test method and withdrawal method for impairment provision of construction in
progress
The Group shall judge whether there is sign of impairment on the balance sheet date. Where any evidence shows
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that there is possible assets impairment, the Group shall estimate the recoverable amount of the assets and make
relevant impairment test.
When impairment test result shows that the recoverable amount of the asset is lower than its book value,
impairment provision shall be withdrawn in accordance with the balance and recorded into impairment loss. The
recoverable amount shall be determined on the basis of the higher one of the net amount of the fair value of the
asset minus the disposal expenses and the current value of the expected future cash flow of the asset. Fair value of
the asset shall be determined in light of the price as stipulated in the sales agreement in the fair transaction. Where
there is no sales agreement but there is an active market of assets, the fair value shall be determined according to
the price bidden by the buyer of the asset. Where there is no sales agreement and no active market of assets, the
fair value shall be estimated in light of the best information available. The disposal expenses shall include the
relevant legal expenses, relevant taxes, truckage as well as the direct expenses for bringing the assets into a
marketable state. The current value of the expected future cash flow of an asset shall be determined by the
discounted cash with an appropriate discount rate, on the basis of the expected future cash flow generated during
the continuous use or final disposal of an asset. Impairment provision of the asset shall be calculated and
determined on the basis of single item asset. Where it is difficult to do so, the enterprise shall determine the
recoverable amount of the group assets on the basis of the asset group to which the asset belongs. The term "group
assets” refers to a minimum combination of assets that can independently generate flow-in cash.
Once the impairment losses of the aforesaid assets are recognized, they can’t be reversed during the subsequent
accounting period.
17. Borrowing costs
(1) Recognition principles for capitalization of borrowing costs
When the borrowing costs can be directly attributable to the construction or production of assets eligible for
capitalization, and the asset disbursements or the borrowing costs have already incurred, and the construction or
production activities which are necessary to prepare the asset for its intended use or sale have already started, the
capitalization of borrowing costs begins. When the asset eligible for capitalization under acquisition and
construction or production is ready for the intended use or sale, the capitalization of the borrowing costs shall be
ceased. Other borrowing costs shall be recognized as expenses when incurred.
(2) Capitalization period of borrowing costs
When the asset eligible for capitalization under acquisition and construction or production is ready for the
intended use or sale, the capitalization of the borrowing costs shall be ceased. The borrowing costs, which
occurred after the asset eligible for capitalization under acquisition and construction or production being ready for
the intended use or sale, shall be recognized as expenses with the occurring amount, and then recorded into
current gains and losses.
(3) Period for ceasing capitalization of borrowing costs
Where the construction or production of asset eligible for capitalization is interrupted abnormally and the
interruption period lasts for more than 3 months, the capitalization of the borrowing costs shall be suspended till
the construction or production of the asset restarts.
(4) Calculation method of capitalized amount of borrowing costs
The amount of interests shall be capitalized in light of the actual cost incurred of the specially borrowed loan at
the current period minus the income of interests earned on the unused borrowing loans as a deposit in the bank or
as a temporary investment. The to-be-capitalized amount shall be determined by multiplying the weighted average
asset disbursement of the part of the accumulative asset disbursements minus the general borrowing by the
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capitalization rate of the general borrowing used. The capitalization rate shall be calculated and determined in
light of the weighted average interest rate of the general borrowing.
18. Biological assets
Naught
19. Oil-gas assets
Naught
20. Intangible assets
(1) Pricing method of intangible assets
Intangible assets are initially measured according to its costs. Expenses relating to intangible assets shall be
recorded into cost of intangible assets if relevant economic profit is much likely to flow into the Group and its cost
can be reliably measured. Except for that, expenses of other items shall be recorded into profit or loss in the period
in which it is incurred when incurred.
(2) Estimated useful life of intangible assets with limited useful life
Intangible assets with limited service lives are averagely amortized by deducting the expected net salvage value
and the withdrawn accumulative amount of provision for the impairment from the original value on a straight-line
basis within their expected service lives beginning from the start of its usage. At the end of the period, service
lives and amortization method for intangible assets with limited service lives shall be checked. If there’s any
change, the change shall be disposed as a change of the accounting estimates.
Item Estimated useful life Basis
Land use right 50 years Useful life listed in the land use right certificate
Software and special
Over 5 years Useful life predicted by the law or contract
technologies
(3) Judgment basis of intangible assets with uncertain useful life
Only if there is valid evidence showing the useful life of an intangible asset can’t be reasonably estimated
according to the available information, the intangible asset can be recognized as intangible asset with uncertain
useful life.
(4) Withdrawal of impairment provision of intangible assets
The Group shall judge whether there is sign of impairment on the balance sheet date. Where any evidence shows
that there is possible assets impairment, the Group shall estimate the recoverable amount of the assets and make
relevant impairment test. Intangible assets of good will or with uncertain service lives, as well as intangible assets
failing to reach the condition for use, shall be subject to impairment tests every year, no matter whether there is
any sign of possible assets impairment.
When impairment test result shows that the recoverable amount of the asset is lower than its book value,
impairment provision shall be withdrawn in accordance with the balance and recorded into impairment loss. The
recoverable amount shall be determined on the basis of the higher one of the net amount of the fair value of the
asset minus the disposal expenses and the current value of the expected future cash flow of the asset. Fair value of
the asset shall be determined in light of the price as stipulated in the sales agreement in the fair transaction. Where
there is no sales agreement but there is an active market of assets, the fair value shall be determined according to
74
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
the price bidden by the buyer of the asset. Where there is no sales agreement and no active market of assets, the
fair value shall be estimated in light of the best information available. The disposal expenses shall include the
relevant legal expenses, relevant taxes, truckage as well as the direct expenses for bringing the assets into a
marketable state. The current value of the expected future cash flow of an asset shall be determined by the
discounted cash with an appropriate discount rate, on the basis of the expected future cash flow generated during
the continuous use or final disposal of an asset. Impairment provision of the asset shall be calculated and
determined on the basis of single item asset. Where it is difficult to do so, the enterprise shall determine the
recoverable amount of the group assets on the basis of the asset group to which the asset belongs. The term "group
assets” refers to a minimum combination of assets that can independently generate the flow-in cash.
When making an impairment test, the carrying value of the goodwill presented separately in financial statements
shall be distributed to the asset group or combination of asset groups that can benefit from the synergy effect of
enterprise merger. If the impairment test shows that the recoverable amount of the asset groups or combinations of
asset groups containing good will is lower than their carrying value, then the correspondent impairment loss shall
be recognized. The amount of the impairment loss shall first charge against the carrying value of the headquarter'
assets and good will which are apportioned to the asset group or combination of asset groups, then charge it
against the carrying value of other assets in proportion to the weight of other assets in the asset group or
combination of asset groups with the good will excluded.
Once the impairment losses of the aforesaid assets are recognized, they can’t be reversed during the subsequent
accounting period.
(5) Criteria of separating the research phase and development phase of internal R&D project
The expenditures for internal research and development projects of an enterprise shall be classified into research
expenditures and development expenditures.
(6) Calculation of the expenditures of internal R&D project
The expenditures for internal research and development projects of an enterprise shall be classified into research
expenditures and development expenditures.
The research expenditures shall be recorded into the profit or loss for the current period.
The development expenditures shall be confirmed as intangible assets when they satisfy the following conditions
simultaneously, and shall be recorded into profit or loss for the current period when they don’t satisfy the
following conditions.
① It is feasible technically to finish intangible assets for use or sale;
② It is intended to finish and use or sell the intangible assets;
③ The usefulness of methods for intangible assets to generate economic benefits shall be proved, including being
able to prove that there is a potential market for the products manufactured by applying the intangible assets or
there is a potential market for the intangible assets itself or the intangible assets will be used internally;
④ It is able to finish the development of the intangible assets, and able to use or sell the intangible assets, with the
support of sufficient technologies, financial resources and other resources;
⑤ The development expenditures of the intangible assets can be reliably measured.
As for expenses that can’t be identified as research expenditures or development expenditures, the occurred R &
D expenses shall be all included in current profits and losses.
21. Amortization method of long-term deferred expenses
The Group’s long-term deferred expenses are measured by the actual cost, and averagely amortized over the
beneficiary period. As for the long-term deferred expenses that can’t benefit for the future accounting period, its
75
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
amortized value shall be totally recorded into current gains and losses.
22. Assets transfer with repurchasing conditions
Naught
23. Estimated liabilities
(1) Recognition criteria of estimated liabilities
The obligation pertinent to a contingent event shall be recognized as an estimated liability when the following
conditions are satisfied simultaneously: ① That obligation is a current obligation of the Group; ② It is likely to
cause any economic benefit to flow out of the Group as a result of performance of the obligation; ③ The amount
of the obligation can be measured in a reliable way.
(2) Measurement of estimated liabilities
On the balance sheet date, with full consideration of the risks, uncertainty, time value of money, and other factors
pertinent to the contingent event, the estimated liabilities shall be initially measured in accordance with the best
estimate of the necessary expenses for the performance of the current obligation.
When all or some of the expenses necessary for the liquidation of an estimated liability of the Group is expected
to be compensated by a third party, the compensation should be separately recognized as an asset only when it is
virtually certain that the reimbursement will be obtained. The amount recognized for the reimbursement should
not exceed the book value of the estimated liability.
24. Share-based payment and equity instruments
Inapplicable
25. Repurchase of shares of the Company
Inapplicable
26. Revenues
(1) Criteria for recognition time of revenue from selling goods
Revenues from selling goods are recognized when the following conditions are met simultaneously: 1) the
significant risks and rewards of ownership of the goods have been transferred to the buyer by the Group; 2) the
Group retains neither continuous management right that usually keeps relation with the ownership nor effective
control over the sold goods; 3) the relevant amount of revenues can be measured in a reliable way; 4) the relevant
economic benefits may flow into the enterprise; and 5) the relevant costs incurred or to be incurred can be
measured in a reliable way.
(2) Recognition basis of assignment of right to use assets revenue
When the economic benefits relevant to the assignment of right to use assets may flow into the enterprise and the
amount of revenue can be measured in a reliable way, the Company shall recognize relevant revenue.
(3) Recognition basis of revenues from providing labor services
① Recognition basis of revenues from providing labor services on the condition that the Group can reliably
estimate the outcome of a transaction concerning the labor services it provides. If the Group can, on the date of the
balance sheet, reliably estimate the outcome of a transaction concerning the labor services it provides, it
76
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
recognizes the revenues from providing services employing the percentage-of-completion method. And the
outcome of a transaction concerning the providing of labor services can be measured in a reliable way when the
following conditions are met simultaneously: 1) the amount of revenues can be measured in a reliable way; 2) the
relevant economic benefits are likely to flow into the enterprise; 3) the schedule of completion under the
transaction can be confirmed in a reliable way; and 4) the costs incurred or to be incurred in the transaction can be
measured in a reliable way.
② Recognition standards of revenues from providing labor services on the condition that the Company can not
reliably estimate the outcome of a transaction concerning the labor services it provides
If the Group can not, on the date of the balance sheet, measure the result of a transaction concerning the providing
of labor services in a reliable way, it is to be conducted in accordance with the following circumstances,
respectively:
A. If the cost of labor services incurred is expected to be fully compensated, the revenues from providing labor
services are recognized in accordance with the amount received or expected to be received, and the cost of labor
services incurred is carried forward;
B. If the cost of labor services incurred is expected to be partially compensated, the revenues from providing labor
services are recognized in accordance with the compensated amount, and the cost of labor services incurred is
carried forward;
C. If the cost of labor services incurred is expected to be fully uncompensated, the cost incurred is included in the
current profits and losses, and no revenue from the providing of labor services may be recognized.
(4) Recognition basis and method for the schedule of contracted project when recognizing the
revenue from providing labour services and construction contract by percentage-of-completion method
The method for recognizing the schedule of completion in percentage-of-completion method: it’s decided by the
proportion of the costs incurred against the estimated total costs.
27. Government Subsidies
(1) Types
A government subsidy means the monetary or non-monetary assets obtained free by the Group from the
government, but excluding the capital invested by the government as the owner of the enterprise. Government
subsidies consist of the government subsidies pertinent to assets and government subsidies pertinent to income.
(2) Accounting policies
If a government subsidy is a monetary asset, it shall be measured in the light of the received or receivable amount.
If a government subsidy is a non-monetary asset, it shall be measured at its fair value. If its fair value cannot be
obtained in a reliable way, it shall be measured at its nominal amount. The government subsidies measured at their
nominal amounts shall be directly included in the current profits and losses.
The government subsidies pertinent to assets shall be recognized as deferred income, equally distributed within
the useful lives of the relevant assets, and included in the current profits and losses. The government subsidies
pertinent to incomes used for compensating the related future expenses or losses shall be recognized as deferred
income and shall be included in the current profits and losses during the period when the relevant expenses are
recognized; or those subsidies used for compensating the related expenses or losses shall be directly included in
the current profits and losses.
If it is necessary to refund any government subsidy which has been recognized, it shall be treated respectively in
accordance with the circumstances as follows: 1) If there is the deferred income concerned, the book balance of
the deferred income shall be offset against, but the excessive part shall be included in the current profits and losses;
77
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
and 2) If there is no deferred income concerned to the government subsidy, it shall be directly included in the
current profits and losses.
28. Deferred income tax assets / Deferred income tax liabilities
(1) Recognition basis of deferred income tax assets
The deferred income tax assets are recognized in accordance with the difference (temporary difference) between
the tax bases and the book value. As for the deductible losses that can deduct the taxable income in the future by
the stipulations of tax law, relevant deferred income tax assets shall be recognized. As for the temporary
difference arising from the initial recognition of assets or liabilities in the non-enterprise combination which
neither affects the accounting profits nor the deductable losses, relevant deferred income tax assets shall not be
recognized. On the balance sheet date, the deferred income tax assets shall be measured at the tax rate applicable
to the period during which the relevant assets are expected to be recovered. The deferred income tax assets shall
be recognized to the extent of the amount of the taxable income which it is most likely to obtain and which can be
deducted from the deductible temporary difference, deductible losses and taxes deducted.
(2) Recognition basis of deferred income tax liabilities
The deferred income tax liabilities are recognized in accordance with the difference (temporary difference)
between the tax bases and the book value. As for the temporary difference arising from the initial recognition of
goodwill, relevant deferred income tax liabilities shall not be recognized. As for the temporary difference arising
from the initial recognition of liabilities in the non-enterprise combination which neither affects the accounting
profits nor the taxable income, relevant deferred income tax liabilities shall not be recognized. On the balance
sheet date, the deferred income tax liabilities shall be measured at the tax rate applicable to the period during
which the relevant liabilities are expected to be settled.
29. Operating lease and financial lease
(1) Accounting treatments of operating lease
Business of operating leases recorded by the Group as the lessee:
The rent expenses from operating leases shall be recorded by the lessee in the relevant asset costs or the profits
and losses of the current period by using the straight-line method over each period of the lease term. The initial
direct costs shall be recognized as the profits and losses of the current period. The contingent rents shall be
recorded into the profits and losses of the current period in which they actually arise.
Business of operating leases recorded by the Group as the lessor:
The rent incomes from operating leases shall be recognized as the profits and losses of the current period by using
the straight-line method over each period of the lease term. The initial direct costs of great amount shall be
capitalized when incurred, and be recorded into current profits and losses in accordance with the same basis for
recognition of rent incomes over the whole lease term. The initial direct costs of small amount shall be recorded
into current profits and losses when incurred. The contingent rents shall be recorded into the profits and losses of
the current period in which they actually arise.
(2) Accounting treatments of financial lease
Business of finance leases recorded by the Group as the lessee:
On the lease beginning date, the Group shall record the lower one of the fair value of the leased asset and the
present value of the minimum lease payments on the lease beginning date as the entering value in an account,
recognize the amount of the minimum lease payments as the entering value in an account of long-term account
78
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
payable, and treat the balance between the recorded amount of the leased asset and the long-term account payable
as unrecognized financing charges. Besides, the initial direct costs directly attributable to the leased item incurred
during the process of lease negotiating and signing the leasing agreement shall be recorded in the asset value of
the current period. The balance through deducting unrecognized financing charges from the minimum lease
payments shall be respectively stated in long-term liabilities and long-term liabilities due within 1 year.
Unrecognized financing charges shall be adopted by the effective interest rate method in the lease term, so as to
calculate and recognize current financing charges. The contingent rents shall be recorded into the profits and
losses of the current period in which they actually arise.
Business of finance leases recorded by the Group as the lessor:
On the beginning date of the lease term, the Group shall recognize the sum of the minimum lease receipts on the
lease beginning date and the initial direct costs as the entering value in an account of the financing lease values
receivable, and record the unguaranteed residual value at the same time. The balance between the sum of the
minimum lease receipts, the initial direct costs and the unguaranteed residual value and the sum of their present
values shall be recognized as unrealized financing income. The balance through deducting unrealized financing
incomes from the finance lease accounts receivable shall be respectively stated in long-term claims and long-term
claims due within 1 year.
Unrecognized financing incomes shall be adopted by the effective interest rate method in the lease term, so as to
calculate and recognize current financing revenues. The contingent rents shall be recorded into the profits and
losses of the current period in which they actually arise.
(3) Accounting treatments for those sold and leasing-back
Naught
30. Assets held for sale
Inapplicable
31. Capitalization of assets
Inapplicable
32. Hedging accounting
Inapplicable
33. Changes in main accounting policies and estimates
Were the main accounting policies or estimates changed during the reporting period?
□Yes √No
(1) Change of accounting policies
Were the main accounting policies changed during the reporting period?
□Yes √No
(2) Change of accounting estimates
Were the main accounting estimates changed during the reporting period?
□Yes √No
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
34. Correction of previous accounting errors
Was any accounting error made in previous periods discovered in the reporting period?
□Yes √No
(1) Retrospective restatement method
Was any previous accounting error adopting retrospective restatement method discovered in the reporting period?
□Yes √No
(2) Prospective application method
Was any previous accounting error adopting prospective application method discovered in the reporting period?
□Yes √No
35．Other main accounting policies and estimates as well as compilation method of financial statements
V. Taxation
1. Main taxes and tax rate
Category of taxes Tax basis Tax rate
VAT Taxable income 13% 17%
Business tax Taxable income 5%
Urban maintenance and construction tax Taxable circulating tax 7%
Enterprise income tax Taxable income 25%
Income tax rate of each subsidiary and branch factory
The income tax rates adopted by each subsidiary and branch factory was 25%
2. Tax preference and official documents
Naught
VI. Business combination and consolidated financial statement
1. Subsidiaries
Five subsidiaries were included into the consolidated scope of the Group in 2014.
(1) Subsidiaries obtained by establishment and investment
Unit: RMB Yuan
Actual The The Include Balance
amount Other proporti proporti d in Deducti of
Register Minorit
Subsidia Register Busines Busines of essential on of on of consolid ble parent
Type ed y
ries ed place s nature s scope investm investm holding voting ated minority compan
capital interest
ents at ent shares rights stateme interests y’s
the （%） （%） nt equity
80
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
period-e after
nd deductin
g the
differen
ce that
loss of
minority
interests
exceed
equity
obtained
by
minority
sharehol
ders
Sanonda Wholly-
(Jingzho owned Producti
u) subsidia on of
Pesticid ry Jingzho Manufa 30,000, pesticid 30,413, 100.00 100.00
Yes
e & u cturing 000.00 e and 700.00 % %
Chemic interme
al Co., diate
Ltd.
Wholly- Import
Hubei owned and
Sanonda subsidia export
Foreign ry Jingzho 10,000, of 11,993,0 100.00 100.00
Trading Yes
Trading u 000.00 pesticid 30.00 % %
Co., e and
Ltd. interme
diate
Other notes to subsidiaries obtained by establishment and investment:
(2) Subsidiary through business combination under the same control
Unit: RMB Yuan
Balance
Actual
of
amount The The Include
parent
of Other proporti proporti d in Deducti
Register Minorit compan
Subsidia Register Busines Busines investm essential on of on of consolid ble
Type ed y y’s
ries ed place s nature s scope ents at investm holding voting ated minority
capital interest equity
the ent shares rights stateme interests
after
period-e （%） （%） nt
deductin
nd
g the
81
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
differen
ce that
loss of
minority
interests
exceed
equity
obtained
by
minority
sharehol
ders
Jingzho Producti
u on and
Controll
Hongxia sale of
ed Jingzho Manufa 40,000, 37,619, 60,302.
ng chemica 98.50% 98.50% Yes
subsidia u cturing 000.00 905.41 47
Chemic l raw
ry
als Co., material
Ltd. s
Other notes to subsidiaries obtained through business combination under the same control:
(3) Subsidiary through business combination not under the same control
Unit: RMB Yuan
Balance
of
parent
compan
y’s
equity
Actual
after
amount The The Include
deductin
of Other proporti proporti d in Deducti
Register Minorit g the
Subsidia Register Busines Busines investm essential on of on of consolid ble
Type ed y differen
ries ed place s nature s scope ents at investm holding voting ated minority
capital interest ce that
the ent shares rights stateme interests
loss of
period-e （%） （%） nt
minority
nd
interests
exceed
equity
obtained
by
minority
82
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
sharehol
ders
Other notes to subsidiaries obtained through business combination not under the same control:
2. Special purpose entities or operating entities with control right formed by entrusted operation or lease
Naught
3. Explanation on changes in consolidated scope
Explanation on changes in consolidated scope:
□ Applicable √ Inapplicable
Compared with the previous year, this year (period) newly increased merging entity, because:
Compared with the previous year, this year (period) newly decreased 2 merging entity, because:
Our control over Hubei Sanonda Tianmen Agrochemical Co., Ltd. and Jingzhou Longhua Petrochemical Co., Ltd. ceased because of
share equity sales in Aug. 2013 and they were no longer included in the consolidation scope.
4. Subsidiaries that newly combined into and not combined into consolidation scope in the reporting period
Inapplicable
5. Business combination under same control during the reporting period
Inapplicable
6. Business combination not under same control during the reporting period
Inapplicable
Note
Whether there is a enterprise merger through multiple trading step by step and control of the situation and acquiring right of control
in the reporting period
□ applicable √ inapplicable
7. Subsidiaries reduced by selling equities without control right during the reporting period
Naught
Other explanation of subsidiaries reduced by selling equities without control right
Whether there is a disposal of subsidiary company investment through multiple trading step by step and lost controls right till the
reporting period
□ applicable √ inapplicable
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
8. The counter purchases in the reporting period
Naught
9. Mergers in the reporting period
Naught
10. Exchange rates of major items in financial statements for foreign entities
Naught
(VII) Notes on major items in consolidated financial statements of the Company
1. Monetary funds
Unit: RMB Yuan
Closing balance Opening balance
Item Amount in Exchange Amount in Exchange
Amount in RMB Amount in RMB
foreign currency rate foreign currency rate
Cash: -- -- -- -- 1,229.00
RMB -- -- -- -- 1,229.00
Bank deposit: -- -- 455,907,972.05 -- -- 410,064,692.21
RMB -- -- 434,237,564.09 -- -- 390,831,029.69
USD 3,522,040.04 6.1528 21,670,407.96 3,154,662.62 6.0969 19,233,662.52
Other monetary capitals -- -- 25,000,000.00 -- -- 4,000,000.00
RMB -- -- 25,000,000.00 -- -- 4,000,000.00
Total -- -- 480,907,972.05 -- -- 414,065,921.21
Special explanation shall be made for the accounts limited by being mortgaged, pledged or frozen, deposited overseas or with
potential collecting risks:
Monetary capitals at the period-end increased 16.14% comparing to the period-begin, mainly due to returned money of sales in this
period; other monetary capitals at the period-end were security deposits of account receivable.
2. Trading financial assets
Naught
3. Notes receivable
(1) Category of notes receivable
Unit: RMB Yuan
Category Closing balance Opening balance
Bank acceptance bill 25,163,142.66 41,103,985.15
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Total 25,163,142.66 41,103,985.15
(2) Notes receivable pledged at period-end
Unit: RMB Yuan
Issuing entity Date of issuance Expiring day Amount Remark
(3) Notes transferred to accounts receivable because drawer of the notes fails to execute the contract or
agreement, and undue notes endorsed to other parties at the end of the period
Notes transferred to accounts receivable because drawer of the notes fails to execute the contract or agreement
Unit: RMB Yuan
Issuing entity Date of issuance Expiring day Amount Remark
Notes:
Undue notes endorsed to other parties by the Company
Unit: RMB Yuan
Issuing equity Date of issuance Expiring day Amount Remark
Suzhou CSIQ Sunshine
Power Technology Co., 21 Mar. 2014 21 Sep. 2014 2,000,000.00
Ltd.
Shenzhen Tempus
28 Feb. 2014 28 Aug. 2014 1,413,600.00
Logistics Co., Ltd.
Hangzhou Hulk
27 Mar. 2014 27 Sep. 2014 1,200,000.00
Chemical Co., Ltd.
Hangzhou Hulk
27 Mar. 2014 27 Sep. 2014 1,200,000.00
Chemical Co., Ltd.
Hangzhou Hulk
27 Mar. 2014 27 Sep. 2014 1,100,000.00
Chemical Co., Ltd.
Total -- -- 6,913,600.00 --
Notes:
Notes about trade acceptance which is discounted or pledged
4. Dividends receivable
Naught
5. Interest receivable
(1) Interest receivable
Naught
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
（2）overdue interest
Naught
（3）Note to interest receivable
Naught
6. Accounts receivable
(1) Accounts receivable listed by categories
Unit: RMB Yuan
Closing balance Opening balance
Book balance Bad debt provision Book balance Bad debt provision
Category
Proportion Proportion Proportion Proportion
Amount Amount Amount Amount
(%) (%) (%) (%)
Accounts receivable for which bad debt provisions are made on the group basis
434,743,44 37,651,698. 244,582,0 35,415,634.2
Account age groups 99.93% 8.66% 99.88% 14.48%
3.40 97 81.41 5
434,743,44 37,651,698. 244,582,0 35,415,634.2
Subtotal of the groups 99.93% 8.66% 99.88% 14.48%
3.40 97 81.41 5
Accounts receivable with
insignificant single 302,796.5
amount and individually 302,796.52 0.07% 302,796.52 100.00% 0.12% 302,796.52 100.00%
withdrawn bad debt 2
provision
435,046,23 37,954,495. 244,884,8 35,718,430.7
Total -- -- -- --
9.92 49 77.93 7
Notes of categories of accounts receivable:
1. The Company defines an account receivable equivalent to or above RMB 5 million as an account receivable which is individually
significant.
2. Accounts receivable are divided into three categories by groups
(1) Related-party groups: Divided according to the related-party relation between the debtor and the Company (usually the
Company’s actual controller and other enterprises controlled by it);
(2) Risk-free groups: Divided according to the debtor’s reputation, the nature of the account, safeguard measures, etc. (usually
amounts due from the government for purchases, reserve funds for employees, deposits for contracts, accounts receivable arising
from guarantee terms, etc.);
(3) Account age groups: Divided according to ages of accounts receivable.
3. The Group carries out an independent impairment test on an account receivable which is individually insignificant but has the
following feature. If there is any objective evidence proving that the asset has been impaired (for instance, receivables over which
there exist disputes against the opposite parties or receivables concerning lawsuits and arbitrations; and receivables of which there are
obvious signs indicating that debtors may not be able to fulfill repayment obligations), the Group recognizes impairment loss and
makes bad-debt provisions according to the difference between the present value of the asset’s future cash flow and the asset’s book
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
value.
Accounts receivable with significant single amount and individually withdrawn bad debt provision
□Applicable √Inapplicable
In the groups, accounts receivable adopting aging analysis method to withdraw bad debt provision:
√ Applicable □ Inapplicable
Unit: RMB Yuan
Closing balance Opening balance
Book balance Book balance
Aging Provision for bad Provision for bad
Proportion Proportion
Amount debts Amount debts
(%) (%)
Within 1 year
Including: -- -- -- -- -- --
Within 1 year 417,142,429.43 95.95% 20,857,121.53 218,790,005.54 89.46% 10,939,500.28
Subtotal of within
417,142,429.43 95.95% 20,857,121.48 218,790,005.54 89.46% 10,939,500.28
1 year
1-2 years 0.46 0.00% 0.05 646,904.02 0.26% 64,690.40
2-3 years 371,713.32 0.09% 111,514.00 787,637.00 0.32% 236,291.10
Over 3 years 17,229,300.19 3.96% 16,683,063.44 24,357,534.85 9.96% 24,175,152.47
3 to 4 years 787,637.00 0.18% 393,818.50 342,249.36 0.14% 171,124.68
4 to 5 years 304,836.50 0.07% 152,418.25 22,515.40 0.01% 11,257.70
Over 5 years 16,136,826.69 3.71% 16,136,826.69 23,992,770.09 9.81% 23,992,770.09
Total 434,743,443.40 -- 37,651,698.97 244,582,081.41 -- 35,415,634.25
In the groups, accounts receivable adopting balance percentage method to withdraw bad debt provision:
□ Applicable √ Inapplicable
In the groups, accounts receivable adopting other methods to withdraw bad debt provision:
□ Applicable √ Inapplicable
Accounts receivable with insignificant single amount but individually withdrawn bad debt provision at
period-end:
√ Applicable □ Inapplicable
Unit: RMB Yuan
Withdrawing proportion
Account receivable Balance of book value Provision for bad debt Reason for withdrawal
(%)
Jiangxi Nanchang
Honggu plant protection 302,796.52 302,796.52 100.00% Estimated unrecoverable
center
Total 302,796.52 302,796.52 -- --
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
(2) No accounts receivable reversed or recovered in the reporting period
Naught
(3) Accounts receivable that written off in the reporting period
Unit: RMB Yuan
Whether caused by
Nature of the
Name of entity Time Amount Reason related party
accounts receivable
transactions
Mexico TEKCHEM
Trade receivable 27 Jun. 2014 7,874,358.80 Bankruptcy No
Corporation
Total -- -- 7,874,358.80 -- --
Note
（4）Particulars about shareholders with more than 5% (including 5%) of the voting shares of the
Company in accounts receivable in reporting period
Unit: RMB Yuan
Closing balance Opening balance
Name of entity Provision for bad Provision for bad
Book balance Book balance
debts debts
ADAMA Agricultural Solutions
9,534,979.39 476,748.97 8,286,308.99 414,315.45
LTD.,
Total 9,534,979.39 476,748.97 8,286,308.99 414,315.45
(5) Accounts receivable due to the top five entities
Unit: RMB Yuan
Name of entity Relationship Amount Term Proportion (%)
Foreign customer A Non-related customer 76,291,643.60 Within one year 17.54%
Foreign customer B Non-related customer 41,925,179.20 Within one year 9.64%
Foreign customer C Non-related customer 32,549,419.50 Within one year 7.48%
Foreign customer D Non-related customer 28,650,949.80 Within one year 6.59%
Foreign customer E Non-related customer 23,770,579.85 Within one year 5.46%
Total -- 203,187,771.95 -- 46.71%
(6) Accounts receivable due from related parties
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Unit: RMB Yuan
Name of entity Relationship Amount Proportion (%)
Under the same control of China
ADAMA Agricultural
National Agrochemical 9,534,979.39 2.19%
Solutions LTD.,
Corporation
Under the same control of China
Klamusze Black Dragon
National Agrochemical 1,089,980.00 0.25%
Pesticide Chemical Co., Ltd
Corporation
Hubei Jingzhou Huaxiang Affiliated enterprise of parent
10,184.50 0.00%
Chemical Co., Ltd. company
Total -- 10,635,143.89 2.44%
(7) Information of accounts receivable that terminated recognition
Unit: RMB Yuan
Item Amount Profit or loss related to terminated recognition
Trade Finance 57,023,626.40 1,469,819.98
Total 57,023,626.40 1,469,819.98
(8) If securitization is carried out on accounts receivable as the underlying assets, please list amount of
assets and liabilities arising from further involvement
Naught
7. Other accounts receivable
(1) Other accounts receivable disclosed by type
Unit: RMB Yuan
Closing balance Opening balance
Provision for doubtful Provision for doubtful
Book balance Book balance
Category debts debts
Proportio Proportio Proportion Proportio
Amount Amount Amount Amount
n (%) n (%) (%) n (%)
Other accounts receivable that provisions for bad debts by group
Risk-free groups 7,617,036.40 51.05% 2,762,341.35 21.00%
10,389,119.9
Account age groups 7,303,913.40 48.95% 5,869,875.35 80.37% 79.00% 5,927,070.27 57.05%
7
14,920,949.8 13,151,461.3
Subtotal of group 100.00% 5,869,875.35 39.34% 100.00% 5,927,070.27 45.07%
0 2
Total 14,920,949.8 -- 5,869,875.35 -- 13,151,461.3 -- 5,927,070.27 --
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
0 2
Notes of categories of other accounts receivable:
1. The Company defines an account receivable equivalent to or above RMB 5 million as an account receivable which is individually
significant.
2. Accounts receivable are divided into three categories by groups
(1) Related-party groups: Divided according to the related-party relation between the debtor and the Company (usually the
Company’s actual controller and other enterprises controlled by it);
(2) Risk-free groups: Divided according to the debtor’s reputation, the nature of the account, safeguard measures, etc. (usually
amounts due from the government for purchases, reserve funds for employees, deposits for contracts, accounts receivable arising
from guarantee terms, etc.);
(3) Account age groups: Divided according to ages of accounts receivable.
3. The Group carries out an independent impairment test on an account receivable which is individually insignificant but has the
following feature. If there is any objective evidence proving that the asset has been impaired (for instance, receivables over which
there exist disputes against the opposite parties or receivables concerning lawsuits and arbitrations; and receivables of which there are
obvious signs indicating that debtors may not be able to fulfill repayment obligations), the Group recognizes impairment loss and
makes bad-debt provisions according to the difference between the present value of the asset’s future cash flow and the asset’s book
value.
Other accounts receivable with significant single amount and individually withdrawn bad debt provision
□Applicable √Inapplicable
In the groups, other accounts receivable adopting aging analysis method to withdraw bad debt provision:
√ Applicable □ Inapplicable
Unit: RMB Yuan
Closing balance Opening balance
Book balance Book balance
Aging
Proporti Bad debt provision Proporti Bad debt provision
Amount Amount
on (%) on (%)
Within 1 year
Including:
Within 1 year 586,256.35 8.03% 29,312.82 4,357,102.92 41.94% 217,855.15
Subtotal for those aging
586,256.35 8.03% 29,312.82 4,357,102.92 41.94% 217,855.15
within 1 year
1-2 years 692,000.00 9.47% 69,200.00 330,784.57 3.18% 33,078.46
2-3 years 330,784.57 4.53% 99,235.37 11,290.00 0.11% 3,387.00
Over 3 years 5,694,872.48 77.97% 5,672,127.16 5,689,942.48 54.77% 5,672,749.66
3-4 years 11,105.00 0.15% 5,552.50 34,385.65 0.33% 17,192.83
4-5 years 34,385.65 0.47% 17,192.83
Over 5 years 5,649,381.83 77.35% 5,649,381.83 5,655,556.83 54.44% 5,655,556.83
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Total 7,303,913.40 -- 5,869,875.35 10,389,119.97 -- 5,927,070.27
In the groups, other accounts receivable adopting balance percentage method to withdraw bad debt provision:
□ Applicable √ Inapplicable
In the groups, other accounts receivable adopting other methods to withdraw bad debt provision:
√ Applicable □ Inapplicable
Unit: RMB Yuan
Name of group Book balance Provision for bad debts
Export tax refunds 7,617,036.40 0.00
Total 7,617,036.40 0.00
Other accounts receivable with insignificant single amount but individually withdrawn bad debt provision at
period-end:
□ Applicable √ Inapplicable
(2) No other accounts receivable reversed or recovered in the reporting period
Naught
(3) Other accounts receivable written off in the reporting period
Naught
(4) No other accounts receivable due from shareholders with more than 5% (including 5%) of the voting
shares of the Company in the reporting period
Naught
(5) Nature or content of other accounts receivable with significant amount
Naught
(6) Information of top five other accounts receivable
Unit: RMB Yuan
Relationship with the Proportion of the total
Name of entity Amount Aging
Company (%)
Export tax refunds Non-related party 7,617,036.40 Within 1 year 51.05%
Shantou Biyue Plastic
Non-related party 3,125,000.00 Over 5 years 20.94%
Co., Ltd.
Hubei Jingzhou Shashi
Agricultural Production Non-related party 548,500.00 Over 5 years 3.68%
Materials Co., Ltd.
Railway Station Non-related party 410,141.19 Within 5year 2.75%
Jingzhou safty
Non-related party 300,000.00 Within 5 year 2.01%
supervision bureau
91
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Total -- 12,000,677.59 -- 80.43%
(7) Other account receivable due from related parties
Naught
(8) Information of other accounts receivable that terminated recognition
Naught
(9) If securitization is carried out on the other accounts receivable as the underlying asset, please brief on
the arrangement of relevant transactions.
Naught
(10) Government grants recognized according to account receivable at period-end
Naught
8. Prepayment
(1) List by aging analysis
Unit: RMB Yuan
Closing balance Opening balance
Aging Proportion Proportion
Amount Amount
(%) (%)
Within 1 year 47,918,892.51 99.90% 42,978,528.26 99.85%
1-2 years 50,000.00 0.10% 63,500.00 0.15%
Total 47,968,892.51 -- 43,042,028.26 --
Notes of aging of prepayment:
It is mainly prepayment for raw materials, and most of which aged within one year.
(2) Information of the top 5 prepayment
Unit: RMB Yuan
Relationship with the
Name of entity Amount Aging Reason for unsettled
Company
Non-related-party Prepayment for raw
Supplier A Non-related party 19,425,562.36
supplier materials
Non-related-party Prepayment for raw
Supplier B Non-related party 11,741,533.25
supplier materials
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Non-related-party Prepayment for raw
Supplier C Non-related party 2,909,212.00
supplier materials
Non-related-party Prepayment for raw
Supplier D Non-related party 1,260,236.20
supplier materials
Non-related-party Prepayment for raw
Supplier E Non-related party 1,080,000.00
supplier materials
Total -- 36,416,543.81 -- --
Notes of important companies of prepayment:
It is mainly bulk raw material suppliers
(3) Information about amount due from shareholders with more than 5% (including 5%) of the voting
shares of the Company in prepayment
Naught
(4) Notes of prepayment
Naught
9. Inventory
(1) Category
Unit: RMB Yuan
Closing balance Opening balance
Item Impairment of Impairment of
Book balance Book value Book balance Book value
inventories inventories
Raw materials 44,164,212.38 44,164,212.38 57,168,007.21 145,674.50 57,022,332.71
Goods in process 79,267,376.59 114,778.63 79,152,597.96 66,802,557.42 552,451.70 66,250,105.72
Inventory goods 203,981,297.58 1,024,957.61 202,956,339.97 134,237,472.95 2,831,097.35 131,406,375.60
Turnover material 1,943,623.54 1,943,623.54 3,595,643.85 3,595,643.85
Total 329,356,510.09 1,139,736.24 328,216,773.85 261,803,681.43 3,529,223.55 258,274,457.88
(2) Provision for falling price of inventories
Unit: RMB Yuan
Withdrawal in the Decrease in the reporting period
Category Opening book value Closing book balance
reporting period Reversal Written off
Raw materials 145,674.50 145,674.50
Goods in process 552,451.70 114,778.63 552,451.70 114,778.63
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Inventory goods 2,831,097.35 1,024,957.61 2,831,097.35 1,024,957.61
Total 3,529,223.55 1,139,736.24 3,529,223.55 1,139,736.24
(3) Details of provision for falling price of inventories
Proportion of reversal of
Basis on provision for falling Reasons for reversal in provision for impairment of
Item
price of inventories reporting period inventories to closing balance
(%)
Book cost is higher than
Raw materials
realizable net value
Book cost is higher than
Inventory goods
realizable net value
Book cost is higher than
Goods in process
realizable net value
Book cost is higher than
Turnover material
realizable net value
Book cost is higher than
Consumable biological assets
realizable net value
Notes of inventory:
Inventories were all in normal condition and the falling price of inventory was due to the market factor
10. Other current assets
Naught
11. Available-for-sale financial assets
Naught
12. Held-to-maturity investment
Naught
13. Long-term accounts receivable
Naught
14. Investment to joint ventures and associated enterprises
Naught
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
15. Long-term equity investment
(1) List of long-term equity investment
Unit: RMB Yuan
Explanati
on for
indifferen
ces Withdraw
between n
Sharehold Cash
Voting the impairme
Accounti Initial ing Impairme bonus in
Opening Increase/d Closing percentag sharehold nt
Investee ng investmen percentag nt the
balance ecrease balance e in ing provision
method t cost e in provision reporting
investee percentag in the
investee period
e and reporting
voting period
percentag
e in
investee
Hubei Cost 20,000,00 20,000,00 20,000,00 11,991,01
0.71% 0.71%
Bank method 0.00 0.00 0.00 7.37
Hubei
Shendian
Mobile
Cost 564,000.0 564,000.0 564,000.0
and 0.60% 0.60%
method 0 0 0
Electric
Motor
Co., Ltd.
Guangxi
Zhongdin Cost 580,800.0 580,800.0 580,800.0
1.41% 1.41%
g Holding method 0 0 0
Co., Ltd
Total -- --
Hubei Cost 21,144,80 21,144,80 21,144,80 11,991,01
-- -- --
Bank method 0.00 0.00 0.00 7.37
(2) Information of the limitation on the capability to transfer capital to investee
Naught
95
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
16. Investment property
(1) Investment property calculated by cost
Unit: RMB Yuan
Increase in the reporting Decrease in the
Item Opening book balance Closing book balance
period reporting period
I. Total original book
6,010,000.00 6,010,000.00
value
1. Houses & buildings 6,010,000.00 6,010,000.00
II. Accumulated
depreciation and
1,855,587.50 120,200.00 1,975,787.50
accumulated
amortization
1. Houses & buildings 1,855,587.50 120,200.00 1,975,787.50
III. Total net book
value of investment 4,154,412.50 -120,200.00 4,034,212.50
property
1. Houses & buildings 4,154,412.50 -120,200.00 4,034,212.50
V. Total book value of
4,154,412.50 -120,200.00 4,034,212.50
investment property
1. Houses & buildings 4,154,412.50 -120,200.00 4,034,212.50
Unit: RMB Yuan
The reporting period
Depreciation and amortization of the reporting period 120,200.00
(2) Investment property calculated by fair value
Unit: RMB Yuan
Increase in this period Decrease in this period
Fair value at Self-own Loss and Fair value
Transfer to
Item the real estate or gain for the at the
Purchase Disposition be self-own
period-begin inventory change of period-end
real estate
transfer fair value
Illustrate situations of investment real estate with changing measurement model and investment real estate without certificate of title
in the reporting period, and demonstrate the reason and expected time of completion of investment real estate without certificate of
title.
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
17. Fixed assets
(1) Information
Unit: RMB Yuan
Opening book Decrease in the Closing book
Item Increase in the reporting period
balance reporting period balance
I. Total original book value 2,124,572,290.46 10,473,114.78 4,863,296.22 2,130,182,109.02
Including: Property and
683,773,706.22 4,138,926.10 687,912,632.32
buildings
Machineries 1,428,877,957.73 6,334,188.68 4,586,334.22 1,430,625,812.19
Vehicles 11,920,626.51 276,962.00 11,643,664.51
Opening book Increase in Withdrawal in Decrease in current Closing book
--
balance current period current period period balance
II. Accumulated
785,539,154.77 86,205,514.07 4,748,051.03 866,996,617.81
depreciation
Including: Property and
172,101,069.18 14,821,382.37 186,922,451.55
buildings
Machineries 605,502,571.04 71,375,667.80 4,534,313.02 672,343,925.82
Vehicles 7,935,514.55 8,463.90 213,738.01 7,730,240.44
Opening book Closing book
-- --
balance balance
III. The net book value of
1,339,033,135.69 -- 1,263,185,491.21
fixed assets
Including: Property and
511,672,637.04 -- 500,990,180.77
buildings
Machineries 823,375,386.69 -- 758,281,886.37
Vehicles 3,985,111.96 -- 3,913,424.07
IV. Total impairment
14,810,750.66 -- 14,810,750.66
provision
Including: Property and
2,848,203.34 -- 2,848,203.34
buildings
Machineries 11,962,547.32 -- 11,962,547.32
V. Total book value of fixed
1,324,222,385.03 -- 1,248,374,740.55
assets
Including: Property and
508,824,433.70 -- 498,141,977.43
buildings
Machineries 811,412,839.37 -- 746,319,339.05
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Vehicles 3,985,111.96 -- 3,913,424.07
Depreciation amount of this reporting period was of RMB 86,205,514.07; RMB0.00 was transferred into fixed assets from
construction project in the reporting period.
(2) Temporary idle fixed assets
Unit: RMB Yuan
Accumulated Impairment
Item Original book value Net book value Remark
depreciation provision
Houses& Buildings 5,531,028.88 3,496,992.73 1,757,484.71 276,551.44
(3) Fixed assets leased in from financing lease
Naught
(4) Fixed assets leased out from operation lease
Unit: RMB Yuan
Item Closing book value
Houses& Buildings 1,313,170.52
(5) Information of hold-for-sale fixed assets at period-end
Naught
(6) Information of fixed assets failed to accomplish certification of property
Naught
18. Construction in progress
(1)
Unit: RMB Yuan
Closing balance Opening balance
Item Impairment Impairment
Book balance Book value Book balance Book value
provision provision
139,429,255.2
Ionic membrane project 139,429,255.21 101,575,796.33 101,575,796.33
1
109,618,954.5
Project advance payment 109,618,954.50 57,507,628.79 57,507,628.79
0
Salt and salt nitrate project
73,605,396.39 73,605,396.39 42,660,410.65 42,660,410.65
(area A)
Glyphosate environmental 27,664,385.04 27,664,385.04 18,207,615.67 18,207,615.67
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
protection optimization project
110KV substation and the
21,806,278.09 21,806,278.09 10,645,849.06 10,645,849.06
perimeter (area A）
Methylene chloride tail gas
2,477,787.00 2,477,787.00 2,148,232.29 2,148,232.29
recovery project
Acephate process optimization
2,984,737.45 2,984,737.45 604,338.30 604,338.30
of engineering
Methyl phosphate technical
1,248,057.97 1,248,057.97 524,354.85 524,354.85
innovation
Sewage salt water transport 2,857,129.98 2,857,129.98 506,802.67 506,802.67
The new construction project
of clean-water reservoirs in the 106,837.62 106,837.62 106,837.62 106,837.62
sewage disposal plant
Management &transformation
527,533.47 527,533.47
Sewage flowing into the river
The production quality
inspection center relocation 253,642.29 253,642.29
project
Thermal coal wharf of fire
protection system 1,330,156.00 1,330,156.00
reconstruction project
Spermine ammoniation
262,280.00 262,280.00
wastewater treatment project
Sewage plant wastewater
biochemical pool seal&
21,499.34 21,499.34
exhaust gas absorption
equipment
HR Sanonda talents apartment
4,000,000.00 4,000,000.00
project
Process optimization and
safety measures of pyridine 2,369,391.89 2,369,391.89
engineering
390,563,322.2
Total 390,563,322.24 234,487,866.23 234,487,866.23
4
(2) Significant changes in construction in progress
Unit: RMB Yuan
Increase Project Includin Capitaliz
Transferr Capitaliz Source
Name of Opening in Other input Project g: ation of Closing
Budget ed to ation of of
project balance current decrease percenta process capitaliz interest balance
fixed interest funding
period ge of ation of rate (%)
99
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
assets budget interest
this
period
Salt and
Borrowi
salt
247,021, 42,660,4 30,944,9 3,242,51 3,242,51 ng & 73,605,3
nitrate 29.80% 29.80% 6.40%
100.00 10.65 85.74 8.47 8.47 self-raise 96.39
project
d
(area A)
110KV
substatio Borrowi
n and the 89,365,8 10,645,8 11,160,4 ng & 21,806,2
24.40% 24.40%
perimete 00.00 49.06 29.03 self-raise 78.09
r (area d
A）
Ionic Borrowi
membra 374,599, 101,575, 37,853,4 4,233,92 2,714,77 ng & 139,429,
37.22% 37.22% 6.40%
ne 000.00 796.33 58.88 3.70 4.82 self-raise 255.21
project d
Glyphos
ate
environ
28,800,0 18,207,6 9,456,76 121,174. Self-rais 27,664,3
mental 96.06% 96.06%
00.00 15.67 9.37 54 ed 85.04
optimiza
tion
project
Methyle
ne
chloride 2,450,00 2,148,23 329,554. 11,349.2 Self-rais 2,477,78
101.13% 99%
tail gas 0.00 2.29 71 0 ed 7.00
recovery
project
Acephat
e process
optimiza 3,300,00 604,338. 2,380,39 Self-rais 2,984,73
90.45% 90.45% 3,541.58
tion of 0.00 30 9.15 ed 7.45
engineeri
ng
Methyl
phosphat
2,300,00 524,354. 723,703. Self-rais 1,248,05
e 54.26% 54.26% 2,813.06
0.00 85 12 ed 7.97
technical
innovati
100
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
on
Sewage
salt 3,450,00 506,802. 2,350,32 Self-rais 2,857,12
82.82% 82.82% 2,630.73
water 0.00 67 7.31 ed 9.98
transport
HR
Sanonda
15,000,0 4,000,00 Self-rais 4,000,00
talents 26.67% 26.67%
00.00 0.00 ed 0.00
apartmen
t project
Process
optimiza
tion and
safety
2,950,00 2,369,39 Self-rais 2,369,39
measures 80.32% 80.32%
0.00 1.89 ed 1.89
of
pyridine
engineeri
ng
769,235, 176,873, 101,569, 7,617,95 5,957,29 278,442,
Total -- -- -- --
900.00 399.82 019.20 1.28 3.29 419.02
Notes of changes in construction in progress:
(3) Impairment provision of construction in progress
Naught
(4) Information of procedures of significant construction in progress
Item Process Remark
Salt and salt nitrate project (area A) 29.80% Under construction
110KV substation and the perimeter
24.40% Under construction
(area A）
Ionic membrane project 37.22% Under construction
Glyphosate environmental optimization
96.06% Under construction
project
Methylene chloride tail gas recovery
99.00% Under construction
project
Acephate process optimization of
90.45% Under construction
engineering
Methyl phosphate technical innovation 54.26% Under construction
Sewage salt water transport 82.82% Under construction
HR Sanonda talents apartment project 26.67% Under construction
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Process optimization and safety measures
80.32% Under construction
of pyridine engineering
(5) Notes of construction in progress:
The balance of construction in process was RMB 390,563,322.24 at the end of year which increased 66.56% than that at the
beginning of the year, mainly was caused by ionic membrane project.
19. Engineering materials
Unit: RMB Yuan
Item Opening balance Increase Decrease Closing balance
Proprietary material 0.00 59,170,164.85 16,278,713.74 42,891,451.11
Special equipment 7,635,991.09 7,635,991.09
Total 66,806,155.94 23,914,704.83 42,891,451.11
Note:
Closing balance mainly was the inventory material for the y ionic membrane project.
20. Clearance of fixed assets
Naught
21. Productive biological assets
Naught
22. Oil and gas assets
Naught
23. Intangible assets
(1) Information
Unit: RMB Yuan
Increase in the reporting Decrease in the
Item Opening balance Closing balance
period reporting period
I. Total original book value 212,657,207.03 3,084,553.00 215,741,760.03
Land use right 198,611,007.07 2,184,553.00 200,795,560.07
Non-patents 14,043,699.96 900,000.00 14,943,699.96
Patent 2,500.00 2,500.00
II. Total accrued
43,213,964.40 1,997,114.46 45,211,078.86
amortization
Land use right 37,163,431.19 1,669,114.44 38,832,545.63
Non-patents 6,048,033.21 328,000.02 6,376,033.23
Patent 2,500.00 2,500.00
III. Total net book value of
169,443,242.63 1,087,438.54 170,530,681.17
intangible assets
Land use right 161,447,575.88 515,438.56 161,963,014.44
Non-patents 7,995,666.75 571,999.98 8,567,666.73
Patent
IV. Total impairment 32,072,093.53 32,072,093.53
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
provision
Land use right 32,072,093.53 32,072,093.53
Non-patents
Patent
Total book value of
137,371,149.10 1,087,438.54 138,458,587.64
intangible assets
Land use right 129,375,482.35 515,438.56 129,890,920.91
Non-patents 7,995,666.75 571,999.98 8,567,666.73
Patent
Amortization was of RMB 1,997,114.46 in the reporting period.
(2) Company development expense
Unit: RMB Yuan
Decrease
Item Opening balance Increase Recognized into Recognized as Closing balance
current gains/losses intangible assets
Development expense percentage of total expenditure of R&D projects in the reporting period.
Percentage intangible assets arising from inner R&D of the Company of closing book value of intangible assets.
Notes of R&D projects of the Company, those that include individual value of more than RMB 1 million and
recognized with a basis of assessed value, please disclose name of evaluation authority and method of evaluation:
Naught
24. Goodwill
Naught
25. Long-term amortization expense
Naught
26. Deferred tax assets and liabilities
(1) Deferred tax assets and liabilities are not listed as the net value after offset
Deferred tax assets and liabilities that already recognized
Unit: RMB Yuan
Item Closing balance Opening balance
Deferred income tax assets:
Provision for assets impairment 12,533,590.90 12,619,948.14
Subtotal 12,533,590.90 12,619,948.14
Deferred income tax liabilities:
List of unrecognized deferred income tax assets
Unit: RMB Yuan
Item Closing balance Opening balance
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Deductible temporary differences 20,540,792.91 20,405,981.43
Total 20,540,792.91 20,405,981.43
Deductible losses of unrecognized deferred income tax assets will due in the following years
Unit: RMB Yuan
Year Closing balance Opening balance Remark
List of taxable differences and deductible differences items
Unit: RMB Yuan
Temporary differences amount
Item
As at period-end As at period-begin
Taxable differences items
Deductible differences item
Property depreciation preparation 50,134,363.60 50,479,792.56
Total 50,134,363.60 50,479,792.56
(2) Deferred income tax assets and liabilities are listed as the net value after offset
Components items of deferred income tax assets and liabilities after mutual set-off
Unit: RMB Yuan
Deductible or taxabl Deferred income tax Deductible or taxable
Deferred income tax
e temporary differen assets or liabilities temporary
assets or liabilities
Item ces after mutual set after mutual set-off at differences after
after mutual set-off at
-off at the end of t the opening of the mutual set-off at the
the end of the period
he period period opening of the period
Deferred income tax assets 12,533,590.90 50,134,363.60 12,619,948.14 50,479,792.56
Notes of deferred income tax assets and the deferred income tax liabilities
Unit: RMB Yuan
Item Amounts of the mutual set-off in the period
Notes of deferred income tax assets and the deferred income tax liabilities
The Group’s deferred income tax assets were mainly caused by withdrawing asset impairment provision.
27. List of provision for assets impairment
Unit: RMB Yuan
Opening book Decrease Closing book
Item Increase
balance Reversal Written off balance
I. Provision for bad debt 41,645,501.04 10,053,228.60 7,874,358.80 43,824,370.84
II. Provision for inventory
3,529,223.55 1,139,736.24 3,529,223.55 1,139,736.24
falling price
V. Impairment provision of
11,991,017.37 11,991,017.37
long term equity investment
VII. Impairment provision of
14,810,750.66 14,810,750.66
fixed assets
XII. Impairment provision of
32,072,093.53 32,072,093.53
intangible assets
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Total 104,048,586.15 11,192,964.84 11,403,582.35 103,837,968.64
Notes of the list of assets impairment:
28. Other non-current assets
Unit: RMB Yuan
Item Closing balance Opening balance
Land premiums in advance 13,384,400.00 13,384,400.00
Total 13,384,400.00 13,384,400.00
Notes:
29. Short-term loan
(1) Category
Unit: RMB Yuan
Category Closing balance Opening balance
Pledge loan 30,000,000.00 76,220,205.55
Mortgage loan 95,000,000.00 105,000,000.00
Guarantee loan 170,000,000.00 178,000,000.00
Total 295,000,000.00 359,220,205.55
Notes:
Pledge loan of the Company mainly was loan receiving from the pledge of accounts receivable.
Mortgage loan of the Company mainly was loan receiving from mortgage of house and buildings as well as land.
Guarantee loan of the Company mainly was loan receiving from guarantees provided by Jingzhou Sanonda
Holdings Co., Ltd, China National Agrochemical Corporation and China National Chemical Corporation.
Credit loan of the Company mainly was loan receiving from the SG.
(2) List of unsettled mature short-term loan
Naught
30. Trading financial liabilities
Naught
31. Notes payable
Unit: RMB Yuan
Category Closing balance Opening balance
Bank acceptance 140,000,000.00 40,000,000.00
Total 140,000,000.00 40,000,000.00
RMB 14,000,000.00 will be due in next accounting period.
Note
32. Accounts payable
(1)
Unit: RMB Yuan
Item Closing balance Opening balance
Within 1 year 252,805,372.12 149,164,478.71
1 to 2 years 127,071.89 3,284,355.24
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
2 to 3 years 675,825.18 1,001,773.87
Over 3 years 2,726,673.36 2,587,365.28
Total 256,334,942.55 156,037,973.10
(2) The accounts payable to shareholders with more than 5% (including 5%) of the voting shares of the
Company
Unit: RMB Yuan
Name of entity Closing balance Opening balance
(3) Notes of the accounts payable aging over one year:
Name of creditor Amount Reason Whether return
afater the
reporting date
Yuyang Lianhua Tongda Construction Engineering 365,871.65 No
Unsettled
Co., Ltd.
Jingzhou Yuanjie Fine Chemical Co., Ltd. 183,766.00 Unsettled No
Hubei Wuhan Youyi Packing Material Factory 173,350.74 Unsettled No
Henan Special Anti-Corrosion Co., Ltd. 114,188.00 Unsettled No
Shanghai Accessen New Technology Co., Ltd. 110,848.00 Unsettled No
total 948,024.39
33. Advance from customers
(1)
Unit: RMB Yuan
Item Closing balance Opening balance
Within 1 year 40,325,172.50 77,557,371.54
1 to 2 years 216,650.36 411,104.07
2 to 3 years 354,344.49 96,865.75
Over 3 years 1,444,386.43 1,372,100.68
Total 42,340,553.78 79,437,442.04
(2) Advanced from customers from shareholders with more than 5% (including 5%) of the voting shares of
the Company
Naught
(3) Notes of significant advance from customers aging over one year:
As of 30Jun. 2014 there was mo Note of significant advance from customers aging over one year.
34. Payroll payable
Unit: RMB Yuan
Item Opening book balance Increase Decrease Closing book balance
I. Salary, bonus,
17,050,050.00 59,560,452.18 64,974,787.18 11,635,715.00
allowance, subsidy
II. Employee welfare 1,982,575.28 1,982,575.28
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
III. Social insurance 8,263,534.24 18,762,850.24 23,919,712.69 3,106,671.79
1. Including:
Medical insurance 4,042,853.60 3,418,966.76 623,886.84
premiums
2. Basic pension
10,714,252.44 9,019,338.52 1,694,913.92
benefits
3.Pension payments 8,263,023.19 1,904,864.00 9,711,201.66 456,685.53
4. Unemployment
1,144,805.87 964,674.62 180,131.25
insurance
5. Work-related
763,663.20 642,819.80 120,843.40
injury insurance
6. Maternity
511.05 192,411.13 162,711.33 30,210.85
insurance
IV. Housing fund 19,402.62 7,364,604.00 6,333,142.00 1,050,864.62
V. Redemption for
terminations of labor 190,980.00 190,980.00
contract
VI. Others 324,193.00 225,393.00 98,800.00
Labour union budget
and employee 324,193.00 225,393.00 98,800.00
education budget
Other 25,332,986.86 88,185,654.70 97,626,590.15 15,892,051.41
RMB 0.00 is the amounts in arrears in the payroll payable.
The labor union budget and employee education budget is RMB 98,800.00, and the non-monetary benefits are RMB 0.00, the
compensation for terminating the labor contract is RMB 0.00.
The estimated distribution date and amount as well as other arrangements for payroll payable:
The balances of “Wages, bonuses, allowances and subsidies” among the payroll payable mainly are senior and middle management
staff bonuses, which would be issued after Aug, 2014.
35. Taxes payable
Unit: RMB Yuan
Item Closing balance Opening balance
VAT -13,184,273.44 -16,594,848.55
Consumption tax 17,755.17 21,642.79
Business tax 103,744,028.33 81,062,067.94
Corporate income tax 233,594.95 285,147.61
Personal income tax 2,638,210.43 2,955,798.06
Urban maintenance and construction tax 51,577.15 52,102.45
Resource tax 2,265,956.18 3,588,774.80
Property tax 201,682.42 31,682.42
Land use tax 2,737,422.81 1,934,770.98
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Education surtax 98,705,954.00 73,337,138.50
Notes of taxes payable: for the taxable income of branch companies and factories approved to be inter-adjusted by
their local tax authorities, the Company shall specified their calculation procedure.
36. Interest payable
Naught
37. Dividends payable
Unit: RMB Yuan
Reason for unsettlement over 1
Name of company Closing balance Opening balance
year
Individual shareholders didn’t
Jingzhou Shashi Rural Credit Union 250,000.00 250,000.00 withdraw cash dividends on
previous years
Total 250,000.00 250,000.00 --
Notes:
38. Other accounts payable
(1)
Unit: RMB Yuan
Item Closing balance Opening balance
Within 1 year 30,903,406.61 31,252,464.85
1 to 2 years 800,012.01 1,394,291.20
2 to 3 years 986,891.20 1,284,017.00
Over 3 years 1,785,852.31 613,835.31
Total 34,476,162.13 34,544,608.36
(2) Other accounts payable from shareholders with more than 5% (including 5%) of the voting shares of
the Company
Naught
(3) Notes of the other large amount accounts payable aging over 1 year
There were no other large accounts payables aging over 1 year at period-end of the Group.
(4) Notes of other accounts payable with significant amount
39. Estimated liabilities
Naught
40. Non-current liabilities due within 1 year
(1)
Unit: RMB Yuan
Item Closing balance Opening balance
Long-term loan due within 1 year 1,000,000.00 70,400,000.00
Long-term accounts payable due within 1 year 6,990,000.00 6,990,000.00
Total 7,990,000.00 77,390,000.00
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
(2) Long-term loan due within 1 year
Long-term loan due within 1 year
Unit: RMB Yuan
Item Closing balance Opening balance
Guarantee loan 1,000,000.00 70,400,000.00
Total 1,000,000.00 70,400,000.00
RMB 000 of long-term loan due within 1 year was of mature loan with extended term.
Top five long-term loans due within 1 year
Unit: RMB Yuan
Closing balance Opening balance
Foreign Foreign
Creditor Starting date Ending date Currency Rate (%)
currency RMB balance currency RMB balance
balance balance
The
Export-impor
22 Sep.2013 21 Jun. 2015 RMB 4.20% 500,000.00
t Bank of
China
The
Export-impor
10 Sep. 2013 21 Sep. 2014 RMB 4.20% 500,000.00 500,000.00
t Bank of
China
Total -- -- -- -- -- 1,000,000.00 -- 500,000.00
Mature loan of long-term loan due within 1 year:
Unit: RMB Yuan
Reason for Estimated settle
Creditor Amount of loan Overdue date Annual rate (%) Usage
unsettlement date
RMB** was paid back after Balance Sheet Date:
Notes of long-term borrowings due within 1 year:
(3) Bonds payable due within 1 year
Naught
(4) Long-term accounts payable due within 1 year
Unit: RMB Yuan
Creditor Term Initial amount Rate (%) Accrued interest Closing balance Conditions
Hubei Sanonda Acute toxic
5 years 6,990,000.00 6,990,000.00
Co., Ltd. pesticide project
Notes of long-term accounts payable due within 1 year:
The long-term payable due within 1 year in this year had already expired in 2012, which belongs to the unpaid
overdue payables.
41. Other current liabilities
Naught
42. Long-term loan
(1) Category of long-term loan
Unit: RMB Yuan
109
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Item Closing balance Opening balance
Guarantee loan 422,590,000.00 366,490,000.00
Less: long-term loan due within 1 year -1,000,000.00 -70,400,000.00
Total 421,590,000.00 296,090,000.00
Notes: Long-term loan were all guarantee loan received from guarantee provided by Sanonda Group Corporation, China National
Agrochemical Corporation and China National Chemical Corporation.
(2) The top five long-term loans
Closing balance Opening balance
Foreign Foreign
Creditor Starting date Ending date Currency Rate (%)
currency RMB amount currency RMB amount
amount amount
The
Export-impor 79,500,000.0 79,500,000.0
10 Sep. 2013 10 Sep. 2016 RMB 4.20%
t Bank of 0 0
China
The
Export-impor 69,500,000.0 70,000,000.0
22 Sep. 2013 10 Sep. 2016 RMB 4.20%
t Bank of 0 0
China
The
Export-impor 50,000,000.0
24 May 2014 21 Oct. 2016 RMB 6.40%
t Bank of 0
China
The
Export-impor 46,590,000.0 46,590,000.0
29 Sep. 2013 21 Oct. 2016 RMB 6.40%
t Bank of 0 0
China
China
40,000,000.0 40,000,000.0
Construction 14 Oct. 2013 13 Oct. 2018 RMB 6.40%
0 0
Bank
285,590,000. 236,090,000.
Total -- -- -- -- -- --
00 00
Notes of long-term loan: for the long-term loans arising from mature loans with extended term, the Company shall explain the
conditions of extension, principal, interest, expected repayment arrangement:
43. Bonds payable
Naught
Unit: RMB Yuan
Accrued Interest paid
Initial Interest
Issuing interest in in the Closing
Name Face value Issuing date Bond period interest payable at
amount the reporting balance
payable period-end
reporting period
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
period
Note: including share transfer conditions and time of convertible corporation bonds
44. Long-term payable
(1) The top five long-term payable
Unit: RMB Yuan
Conditions of
Unit Term Initial amount Rate (%) Accrued interest Closing balance
loan
Loan for
glyphosate 490,000.00 490,000.00
project
Borrowing for the
cooperation
project with
Guangzhou 160,000.00 160,000.00
Chemical
Industry Research
Institute
(2) List of the financing lease payable under the long-term loan
Unit: RMB Yuan
Closing balance Opening balance
Unit Foreign currency Foreign currency
RMB amount RMB amount
amount amount
RMB 000 of guarantee for the Company’s financing lease provided by independent third party.
Note:
45. Specific payable
Naught
46. Other non-current liabilities
Unit: RMB Yuan
Item Closing book balance Opening book balance
Highly toxic pesticide production Line change and
3,495,000.00 3,883,333.33
replacement project
Special subsidies of sewage source processing 1,099,999.99 1,222,222.22
Subsidies of sewage processing 633,333.34 666,666.67
Pyridine project 8,850,000.00 8,850,000.00
Special subsidies of saving and comprehensive
4,416,666.67 4,916,666.67
utilization of mineral resources
Special subsidies of industrial cleaner production 6,675,925.93
Total 25,170,925.93 19,538,888.89
Note:
This year, the Company received special subsidies of industrial cleaner production of 7 million yuan from the ministry of finance,
recognized as governmental subsidy related with assets, recorded into the current deferred earnings and according to actual service
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
life, staging and apportioning recorded into non-operating income.
Liabilities related to governmental subsidy
Unit: RMB Yuan
Amount recorded
New subsidy Related to
into non-operating Closing
Item Opening balance amount in the Other changes assets/Related to
income in the balance
reporting period income revenue
reporting period
Pyridine project 8,850,000.00 8,850,000.00 Related to assets
Special subsidies of
saving and
comprehensive 4,916,666.67 500,000.00 4,416,666.67 Related to assets
utilization of mineral
resources
Highly toxic pesticide
production Line
3,883,333.33 388,333.33 3,495,000.00 Related to assets
change and
replacement project
Special subsidies of
sewage source 1,222,222.22 122,222.23 1,099,999.99 Related to assets
processing
Subsidies of sewage
666,666.67 33,333.33 633,333.34 Related to assets
processing
Special subsidies of
industrial cleaner 7,000,000.00 324,074.07 6,675,925.93 Related to assets
production
Total 19,538,888.89 7,000,000.00 1,367,962.96 25,170,925.93 --
47. Share capital
Unit: RMB Yuan
Increase/Decrease (+/-)
Opening Capitalization Closing
Issuing new
balance Bonus shares of public Other Subtotal balance
shares
reserves
Total shares 593,923,220.00 593,923,220.00
Note: if there was capital increase or capital decrease in the reporting period, shall disclose the name of public accounting firm of
perform capital verification and reference number of capital verification for the company operating less than 3 years, just indicate net
assets before establishment. Limited liability company changed into joint - stock company shall indicate the capital verification when
the company establish.
48. Treasury stock
Notes of treasury stock:
49. Special reserves
Notes of treasury stock:
112
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Item Opening balance Increase in Decrease in Closing balance
current period current period
Safety in 16,059,288.71 5,531,203.68 1,098,416.22 20,492,076.17
production
expense
Total 16,059,288.71 5,531,203.68 1,098,416.22 20,492,076.17
50. Capital reserves
Unit: RMB Yuan
Item Opening balance Increase Decrease Closing balance
Capital premium (share
254,688,951.94 254,688,951.94
capital premium)
Other capital reserves 8,495,091.72 8,495,091.72
Total 263,184,043.66 263,184,043.66
Note；
51. Surplus reserves
Unit: RMB Yuan
Item Opening balance Increase Decrease Closing balance
Statutory surplus reserves 122,519,162.66 122,519,162.66
Discretional surplus reserves 3,815,085.65 3,815,085.65
Total 126,334,248.31 126,334,248.31
Notes of surplus reserves: for surplus reserves transferred to share capital, compensating losses and distributed as dividends, relevant
resolutions shall be explained:
52. Provision for general risk
Notes of provision for general risk:
53. Retained profits
Unit: RMB Yuan n
Withdrawal or distributed
Item Amount
proportion
Opening balance of retained profits before
546,688,770.98 --
adjustments
Opening balance of retained profits after
546,688,770.98 --
adjustments
Add: Net profit attributable to owners of the
288,406,597.13 --
Company
Dividend of common stock payable 29,696,161.00
Closing retained profits 805,399,207.11 --
List of adjustment of opening retained profits:
1) RMB* opening retained profits was affected by retrospective adjustment conducted according to the Accounting Standards for
Business Enterprises and relevant new regulations.
2) RMB* opening retained profits was affected by changes on accounting policies.
3) RMB* opening retained profits was affected by correction of significant accounting errors.
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
4) RMB* opening retained profits was affected by changes in combination scope arising from same control.
5) RMB* opening retained profits was affected totally by other adjustments.
Notes: as for IPO companies, if the accumulated profits were enjoyed by new and original shareholders according to the resolutions
made at the shareholders’ general meeting before public offering, the Company shall explain clearly; if the accumulated profits were
distributed before public offering and enjoyed by the original shareholders according to the resolutions made at the shareholders’
general meeting, the Company shall clearly disclose the audited profits of dividends payable enjoyed by the original shareholders.
54. Revenue and Cost of Sales
(1) Revenue, Cost of Sales
Unit: RMB Yuan
Item Reporting period Same period of last year
Sales of main business 1,684,628,595.44 1,506,296,510.91
Other operating income 15,652,829.24 13,391,806.31
Cost of sales 1,176,489,773.88 1,210,871,838.98
(2) Main business (Classified by industry)
Unit: RMB Yuan
Reporting period Same period of last year
Industry
Revenue of sales Costs of sales Revenue of sales Costs of sales
Manufacturing of chemical raw
material 1,684,628,595.44 1,165,187,638.55 1,506,296,510.91 1,204,175,172.89
and chemicals
Total 1,684,628,595.44 1,165,187,638.55 1,506,296,510.91 1,204,175,172.89
(3) Main business (Classified by product)
Unit RMB Yuan
Reporting period Same period of last year
Product
Revenue of sales Costs of sales Revenue of sales Costs of sales
Agrochemicals such as
1,752,641,917.67 1,252,800,229.58 1,557,457,099.01 1,267,811,661.55
chemical fertilizer and pesticide
New chemical materials
8,571,350.43 5,424,644.20 8,363,760.70 4,721,396.56
and special chemicals
Petrochemicals and refining
60,572,466.92 52,578,482.51
and chemical products
Basic (chlor-alkali) chemicals 47,776,370.13 31,323,807.56 8,067,409.36 7,227,857.35
Internal offset amount -124,361,042.79 -124,361,042.79 -128,164,225.08 -128,164,225.08
Total 1,684,628,595.44 1,165,187,638.55 1,506,296,510.91 1,204,175,172.89
(4) Main business (Classified by area)
Unit: RMB Yuan
Reporting period Same period of last year
Area
Revenue of sales Costs of sales Revenue of sales Costs of sales
Home 761,969,864.68 555,479,845.28 851,193,234.06 677,842,526.40
Abroad 1,047,019,773.55 734,068,836.06 783,267,501.93 654,496,871.57
Internal offset amount -124,361,042.79 -124,361,042.79 -128,164,225.08 -128,164,225.08
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Total 1,684,628,595.44 1,165,187,638.55 1,506,296,510.91 1,204,175,172.89
(5) The revenue of sales from the top five customers
Unit: RMB Yuan
Customer Main business revenue Proportion of total business revenue (%)
Customer A of foreign accounts 220,136,215.76 12.95%
Customer B of foreign accounts 126,802,492.82 7.46%
Customer C of foreign accounts 93,748,927.03 5.51%
Customer D of foreign accounts 75,665,384.70 4.45%
Customer E of foreign accounts 71,332,949.00 4.20%
Total 587,685,969.31 34.57%
Notes:
55. Revenue from the construction contracts
Unit:: RMB Yuan
Recognized
Incurred cumulative cumulative gross
Fixed price contract Contract item Amount Settled amount
costs profit (Losses
presented by “-”)
Recognized
Incurred cumulative cumulative gross
Cost plus contract Contract item Amount Settled amount
costs profit (Losses
presented by “-”)
Notes:
56. Business tax and surcharges
Unit: RMB Yuan
Item Reporting period Same period of last year Calculation and payment standard
Business tax shall be paid at 5% of
Business tax 107,387.38 385,499.31
turnover
Urban maintenance and construction City maintenance construction tax shall
tax 1,767,227.45 357,626.09 be paid at 7% or 5% of circulating tax
payable of the current period.
Education surtax Extra charges for education shall be
760,383.19 153,268.32 paid at 3% of circulating tax payable of
the current period
Extra charges for local education shall
Local education surtax 504,922.11 98,861.49 be paid at 2% of circulating tax payable
of the current period
Other 481,313.30 60,727.48
Total 3,621,233.43 1,055,982.69 --
Notes:
57. Selling expenses
Unit: RMB Yuan
115
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Item Reporting period Same period of last year
Traffic expenses 11,938,710.71 18,060,547.63
Export costs 22,553,365.76 15,507,210.21
Employee compensations 3,319,894.15 2,808,744.28
Packing expenses 44,288.73 1,464,854.07
Terminal charges 885,532.23 1,990,585.40
Advertising and promotion expenses 458,775.24 484,265.77
Insurance expenses 1,062,369.22 1,086,695.44
Other 2,933,605.78 4,172,509.23
Total 43,196,541.82 45,575,412.03
58. Administration expenses
Unit: RMB Yuan
Item Reporting period Same period of last year
Employee compensations 19,382,802.77 18,993,196.34
Taxes 4,021,054.50 3,040,806.87
Depreciation expenses 2,863,884.93 2,966,158.50
Amortization of intangible assets 1,997,129.77 2,016,029.78
Entertainment expenses 1,303,008.30 1,467,162.48
Assets insurance fees 1,656,713.47 1,706,555.41
Utilities 1,463,693.86 1,698,913.58
Administrative expenses 639,059.81 963,403.31
Workers insurance expense 1,198,076.21 723,565.57
Amortization of low cost and short lived
1,073,814.63 1,091,127.14
articles
Other 20,895,247.17 12,059,784.38
Total 56,494,485.42 46,726,703.36
59. Financial expenses
Unit: RMB Yuan
Item Reporting period Same period of last year
Interest expenses 27,051,166.28 30,364,498.82
Interest incomes -2,349,355.40 -1,985,918.11
Amounts of interest capitalized -5,957,293.29 -2,319,111.21
Gains or losses on exchange -3,527,194.50 5,590,598.37
Other 2,034,609.79 8,561,487.11
Total 17,251,932.88 40,211,554.98
60. Gains and losses from changes in fair value
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
61. Investment income
(1) List of investment income
Unit: RMB Yuan
Item Reporting period Same period of last year
Long-term equity investment income accounted by
2,254,182.43
cost method
Total 2,254,182.43
(2) Long-term equity investment income accounted by cost method
Unit: RMB Yuan n
Same period of last
Name of investee Reporting period Reason for increase/decrease
year
Bank of Hubei 2,254,182.43
Total 2,254,182.43 --
(3) Long-term equity investment income accounted by equity method
Unit: RMB Yuan
Same period of last
Name of investee Reporting period Reason for increase/decrease
year
Notes of investment income: make notes if there is significant limitation for recovery of investment income. If
there isn’t the said limitation, notes too.
62. Impairment losses
Unit: RMB Yuan
Item Reporting period Same period of last year
I. Bad debts losses 10,053,228.60 5,948,409.80
II. Inventory falling price losses 1,139,736.24 -660,846.16
Total 11,192,964.84 5,287,563.64
63. Non-operating gains
(1)
Unit: RMB Yuan
The amount included in the
Item Reporting period Same period of last year current non-recurring gains
and losses
Total gains from disposal of non-current
12,201.92 28,954.04
assets
Including：Gains from disposal of fixed
12,201.92 28,954.04
assets
Government grants 1,367,962.96 1,142,978.13
Penalty income 54,739.10 34,395.00
Other 13,500.00 25,424.40
Total 1,448,403.98 1,231,751.57
Note:
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
(2) List of government grants recorded into current profit and loss
Unit: RMB Yuan
Related to assets/Related Belong to non-recurring
Item Reporting period Same period of last year
to income revenue profit and loss or not
Grants for the project of
replacing acute toxic 388,333.33 388,333.34 Related to assets Yes
pesticide in farming
Special subsidies of Related to assets Yes
sewage source 122,222.23 122,222.22
processing
Subsidies of sewage
33,333.33 33,333.33 Related to assets Yes
processing
Appropriation for CTC
consuming and 599,089.24 Related to assets Yes
eliminating project
Special subsidies of
saving and
comprehensive 500,000.00 Related to assets Yes
utilization of mineral
resources
Special subsidies of
industrial cleaner 324,074.07 Related to assets Yes
production
Total 1,367,962.96 1,142,978.13 -- --
Notes:
64. Non-operating expenses
Unit: RMB Yuan n
The amount included in
Item Reporting period Same period of last year the current non-recurring
gains and losses
Including: Loss on disposal of fixed assets 614,366.72
Loss on debt reconstruction 152,001.61
Other 278,888.58 2,030,841.39
Total 278,888.58 2,797,209.72
Notes:
65. Income tax expense
Unit: RMB Yuan
Item Reporting period Same period of last year
Current income tax expense accounted by tax and relevant
104,903,110.35 45,206,674.61
regulations
Adjustment of income tax 86,357.24 -1,235,675.56
118
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Total 104,989,467.59 43,970,999.05
66. Calculation procedure of basic earnings per share and diluted earnings per share
EPS-basic refers to the current net profit attributable to common shareholders of the Company divided the
weighted average amount of outstanding issued common shares. The amount of newly issued common shares is
calculated from the date of consideration receivable in accordance with the detailed terms of the contract for
issuing shares.
The numerator of EPS-diluted is the current net profit attributable to common shareholders of the Company,
which is fixed by adjusting the following factors: (1) the interest of diluted potential common shares which is
recognized as the expenses of current period; (2) the gains and costs incurred from transferring the diluted
potential common shares; and (3) the influence on income tax from the above adjustment.
The denominator is the sum of the two items as follows: (1) the weighted average amount of common shares
issued by the Parent Company in EPS-basic; (2) the increased weighted average amount of common shares
assuming that diluted potential common shares were transferred to common shares.
While calculating the increased weighted average amount of common shares resulting from that diluted potential
common shares were transferred to issued common shares, the diluted potential common shares issued in previous
period are assumed to be transferred at current period; the diluted potential common shares issued in current
period are assumed to be transferred on the issuing date.
(1) Breakdown of basic earnings per share (EPS-basic) and diluted earnings per share (EPS-diluted) in current and
previous periods.
Profit as of reporting period The reporting period Same period of last year
EPS-basic EPS-diluted EPS-basic EPS-diluted
Net profits attributable to 0.4856 0.4856 0.2146 0.2146
common shareholders of the
Company
0.4841 0.4841 0.2166 0.2166
Net profits attributable to
common shareholders of the
Company after deducting
non-recurring gains and
losses
(2) Explanation on counting process of EPS-basic and EPS-diluted
During the reporting period, there were no diluted potential common shares in the Company so that EPS-diluted
equaled to EPS-basic.
①When calculated the EPS-basic; the net profits attributable to common shareholders were as follows:
Item The reporting period Same period of last year
288,406,597.13 127,470,524.25
Net profit attributable to common
shareholders of the Company
Of which ： Net profit attributable to 288,406,597.13 127,470,524.25
continual operating
Net profit attributable to
119
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
discontinued operating
287,537,764.46 128,673,087.74
Net profit attributable to common
shareholders of the Company after
deducting non-recurring gains and losses
Of which ： Net profit attributable to 287,537,764.46 128,673,087.74
continual operating
②When calculated the EPS-basic, the denominator refers to the weighted average amount of outstanding issued
common shares, and the accounting process as follows:
Item The reporting period Same period of last year
593,923,220.00 593,923,220.00
Amount of outstanding issued common shares at year-begin
Add：weighted average amount of common shares issued in
this year
Deduct ： weighted average amount of common shares
repurchased in this year
Weighted average amount of outstanding issued common 593,923,220.00 593,923,220.00
shares at year-end
67. Other comprehensive income
Naught
68. Notes of Cash Flow Statement
(1) Other cash received relevant to operating activities
Unit: RMB Yuan
Item Amount
Interest income 2,349,355.40
Financial subsidies(Special subsidies of industrial cleaner production) 7,000,000.00
repayment of a shot in the locker and others 4,605,383.91
Total 13,954,739.31
Notes:
(2) Other cash paid relevant to operating activities
Unit: RMB Yuan
Item Amount
Transportation fees 11,938,710.71
Products export fees 16,251,619.72
Terminal charges 885,532.23
Business entertainment 1,303,008.30
Utilities 1,463,693.86
Office expenses 639,059.81
Insurance expenses 2,719,082.69
120
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Advertising and general publicity expense 458,775.24
Other 6,559,739.04
Total 42,219,221.60
Notes:
(3) Other cash received relevant to investment activities
Naught
(4) Other cash paid relevant to investment activities
Naught
(5) Other cash received relevant to financing activities
Naught
(6) Other financial activities-related cash paid
Unit: RMB Yuan
Item Amount
Freeze on cash deposit of note 21,000,000.00
Loan guarantee fees paying for Jingzhou Sanonda Group Co., Ltd. 1,570,000.00
Total 22,570,000.00
Notes:
69. Supplementary information to cash flow statement
(1) Supplementary information to cash flow statement
Unit: RMB Yuan
Supplemental information Reporting period Same period of last year
1. Reconciliation of net profit to net cash flows generated
-- --
from operating activities
Net profit 288,214,540.22 126,676,986.77
Add: Provision for impairment of assets 11,192,964.84 5,287,563.64
Depreciation of fixed assets, of oil-gas assets, of productive
86,325,714.07 79,195,918.91
biological assets
Amortization of intangible assets 1,997,114.46 2,016,029.78
Losses on disposal of property, plant and equipment,
intangible assets and other -12,201.92 -585,412.68
long-term assets (gains: negative)
Financial cost (income: negative) 23,128,482.78 38,686,606.16
Investment loss (gains: negative) -2,254,182.43
Decrease in deferred tax assets (increase: negative) 86,357.24 -1,235,675.56
Increase in deferred tax liabilities (decrease: negative) -67,552,828.66 16,204,479.51
Decrease in inventory (increase: negative) -180,916,872.23 -114,627,321.89
Decrease in accounts receivable from operating activities
211,647,494.95 272,788,131.63
(increase: negative)
Increase in accounts payable from operating activities 374,110,765.75 422,153,123.84
121
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
(decrease: negative)
Net cash flows generated from operating activities -- --
2. Significant investing and financing activities without
-- --
involvement of cash receipts and payments
3. Change of cash and cash equivalent: 455,907,972.05 549,722,485.68
Closing balance of Cash 410,065,921.21 175,181,365.77
Less: opening balance of cash 45,842,050.84 374,541,119.91
(2) Relevant information of acquisition or disposal of subsidiaries and other operation entities in the
reporting period
Naught
(3) Composition of cash and cash equivalents
Unit: RMB Yuan
Item Reporting period Same period of last year
I. Cash 455,907,972.05 410,065,921.21
Including: Cash on hand 1,229.00
Bank deposit on demand 455,907,972.05 410,064,692.21
III. Closing balance of cash and cash equivalents 455,907,972.05 410,065,921.21
Notes:
70. Notes on projects on statement of change in equity
Information on “other” item names when regulating the year end balance of last year and amount adjustment, and retroactive
adjustment incorporated and produced by the enterprise under the same control:
VIII. Accounting treatment of asset securitization business
Naught
IX. Related party and related Transaction
1. Information related to parent company of the Company
Proportion
Proportion
of voting
of share
rights The
held by
Name of Legal Name of owned by ultimate
Relationsh Registratio Business parent Organizati
parent Type representat parent parent controller
ip n of place scope company on code
company ive company company of the
against the
against the Company
Company
Company
(%)
(%)
Jingzhou Production
Controllin
Sanonda Jingzhou, and
g State-owne Li 240,661,00 17898778
Group Hubei operation 20.15% 20.15% SASAC
shareholde d company Zuorong 0 9
Corporatio Province of
r
n pesticide
122
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
and
chemicals
products
Information on the parent company:
China National Chemical Corporation (hereinafter referred to as “Chemical Corporation”) holds 100.00% equity of China N
ational Chemical Corporation, and it’s a central enterprise under the control of SASAC.
2. Information on subsidiaries of the Company
Legal Proportion Proportion
Business Registration Business Registered Organizatio
Name Type representati of holding of voting
Type of place scope capital n code
ve shares (%) rights (%)
Sanonda
(Jingzhou)
wholly-own Limited
Pesticides Deng Tian Manufacturi
ed Liability 30,000,000 100.00% 100.00% 181860033
and Guobin Xueqing ng
subsidiary Company
Chemicals
Co., Ltd.
Hubei
Sanonda wholly-own Limited
Zhang
Foreign ed Liability Li Zuorong Trading 10,000,000 100.00% 100.00% 706963167
Shaochun
Trading subsidiary Company
Co., Ltd.
Jingzhou
wholly-own Limited
Hongxiang Manufacturi
ed Liability Jingzhou Yin Hong 40,000,000 98.50% 98.50% 79877119-6
Chemicals ng
subsidiary Company
Co., Ltd.
3. Information on co-operated or joint operated of the Company
Legal Proportion Proportion
Business Registration Business Registered Relationshi Organizatio
Item representati of holding of voting
Type place scope capital p n code
ve shares (%) rights (%)
I. Co-operated
II. Joint operated
4. Information on other related parties
Name of other related parties Relationship with the Company Organization code
Hubei Jingzhou Huaxiang Chemical Co.,
Affiliated enterprise of parent company 73713373X
Ltd.
Jiangsu Anpon Electrochemical Co., Ltd. Controlled by the same chemical group 139433337
Bluestar (Beijing) Chemical Machinery
Controlled by the same chemical group 795955432
Co., Ltd.
Bluestar Environmental Engineering Co.,
Controlled by the same chemical group 71092737X
Ltd.
ADAMA Agricultural Solutions LTD., Controlled by the same chemical group
Anhui Chemical Engineering Design Controlled by the same chemical group 485001756
123
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Institute
China Haohua Engineering Co.,Ltd. Controlled by the same chemical group 777652403
Shandong Dacheng Pesticide & Chemical
Controlled by the same chemical group 743350546
Corporation
Jiamusi Heilong Pesticide & Chemical
Controlled by the same chemical group 716686183
Corporation
China National Chemical Finance Co., Ltd Controlled by the same chemical group 100019622
Note
5. Transaction of related parties
(1) Information sheet of purchasing goods and receiving services
Unit: RMB Yuan
Amount of this period Amount of last period
Proportio Proportio
Content of related Pricing principle of n in n in
Name of company
transaction related parties Amount transactio Amount transactio
ns of the ns of the
same kind same kind
Bluestar
Environmental
Engineering material Market price 80,435.04 0.01%
Engineering Co.,
Ltd.
Bluestar (Beijing)
Chemical Machinery Engineering material Market price 1,582,136.75 0.13%
Co., Ltd.
Bluestar (Beijing)
Chemical Machinery Equipment Market price 19,076,923.08 1.62%
Co., Ltd.
Bluestar (Sichuan)
Raw material Market price 179,487.18 0.02%
Machinery Co., Ltd.
Jingzhou Huaxiang
Raw material Market price 351,221.61 0.03% 1,068,201.65 0.09%
Chemical Co., Ltd.
Jingzhou Shanonda
Wrappage Market price 1,004,419.66 0.09% 2,282,015.28 0.19%
Holdings Co., Ltd.
China Haohua Equipment& labour
Market price 20,147,456.04 1.71%
Engineering Co.,Ltd. service
List of sales of good and receive of service
Unit: RMB Yuan
Amount of this period Amount of last period
Content of related Pricing principle of
Name of company Proportio Proportio
transaction related parties Amount Amount
n in n in
124
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
transactio transactio
ns of the ns of the
same kind same kind
ADAMA
Agricultural Sales of pesticides Market price 16,850,070.00 0.99% 8,797,829.52 0.58%
Solutions LTD.,
Jiamusi Heilong
Pesticide &
Sales of pesticides Market price 1,817,876.11 0.11% 4,434,955.75 0.29%
Chemical
Corporation
Jiangsu Anpon
Electrochemical Co., Sales of pesticides Market price 3,119,469.03 0.18% 2,513,274.34 0.17%
Ltd.
Hubei Jingzhou
Huaxiang Chemical Raw material; Market price 2,131,405.13 0.14%
Co., Ltd.
Jingzhou Shanonda
Chemical Products Market price 1,974,829.05 0.12% 4,555,930.97 0.30%
Holdings Co., Ltd.
Shandong Dacheng
Pesticide &
Sales of pesticides Market price 13,475,663.72 0.79% 2,444,247.79 0.16%
Chemical
Corporation
(2) Related deposit/contract
Naught
(3) Related leased items
Leased items of the company
Unit: RMB Yuan
The lease income
Category of Pricing evidence
Name of lesser Name of lessee Start date of lease End date of lease confirmed in the
leased assets of lease income
report period
th
Hubei Sanonda Sanonda Group 7 floor of the
1, Jan, 2014 31, Dec, 2014 Agreement
Co., Ltd. Company office building
Leased items of the company
Naught
(4) Related-party guarantee
Unit: RMB Yuan
Execution
Guarantor Secured party Guarantee amount Start date End date
accomplished or not
Jingzhou Shanonda
The Company 50,000,000.00 2 Jan. 2014 1 Jan. 2015 No
Holdings Co., Ltd.
Jingzhou Shanonda The Company 170,000,000.00 12 Mar. 2014 12 Mar. 2015 No
125
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Holdings Co., Ltd.
China National
Agrochemical The Company 300,000,000.00 9 Sep. 2013 9 Sep. 2016 No
Corporation
China National
Agrochemical The Company 100,000,000.00 20 Dec. 2012 20 Dec 2016 No
Corporation
China National
Agrochemical The Company 50,000,000.00 30 Jan. 2013 30 Jun. 2014 Yes
Corporation
China National
Agrochemical The Company 150,000,000.00 10 Sep. 2013 10 Sep. 2018 No
Corporation
China National
Chemical The Company 100,000,000.00 28 Jul. 2008 9 Feb.2014 Yes
Corporation
China National
Chemical The Company 200,000,000.00 25 Sep. 2013 25 Sep. 2020 No
Corporation
China National
Chemical The Company 150,000,000.00 14 Oct. 2013 14 Oct. 2020 No
Corporation
China National
Chemical The Company 160,000,000.00 10 Jun. 2014 9 Jun. 2019 No
Corporation
Hubei Sanonda
The Company Foreign Trade Co., 65,000,000.00 26 Jan. 2014 26 Jan. 2016 No
Ltd.
Hubei Sanonda
The Company Foreign Trade Co., 60,000,000.00 23 Jun. 2013 22 Jun. 2015 No
Ltd.
Hubei Sanonda
The Company Foreign Trade Co., 30,000,000.00 4 Dec. 2009 4 Dec. 2016 No
Ltd.
Hubei Sanonda
The Company Foreign Trade Co., 64,000,000.00 11 Dec. 2013 11 Dec. 2016 No
Ltd.
Hubei Sanonda
The Company Foreign Trade Co., 60,000,000.00 29 Apr. 2014 29 Apr. 2015 No
Ltd.
Hubei Sanonda
The Company Foreign Trade Co., 50,000,000.00 22 Jan. 2013 21 Jan. 2017 No
Ltd.
126
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Information on related-party guarantee:
Mainly is the Guarantee for loans for the Hubei Sanonda Foreign Trade Co., Ltd. provided by the holding subsidiaries, and it’s the
maximum amount of guarantee offered by the Company’s trade finance act of opening letters of credit and documentary credit etc,
Guarantee for loans is mainly provided by Sanonda Group Corporation, China National Agrochemical Corporation and China
National Chemical Corporation.
(5) Inter-bank lending capital by related party
Naught
(6) Asset assignment and debt restructuring of related party
Naught
(7) Other related transactions
Amount for current period Amount for last period
Transa Occupancy
Pricing type Occupancy of
ction Transaction of proportion
for related proportion
Related party type by content by amount of
party Amount Amount amount of
related related party similar
transaction similar
party transaction
transaction (%)
(%)
Shanonda Holdings Co., Guaran Pay for Agreement 1,570,000.00 100 2,880,000.00 32.43
Ltd. tee guarantee fees price
China National 6,000,000.00 67.57
Guaran Pay for Agreement
Agrochemical
tee guarantee fees price
Corporation
①the salary of the parent company Jingzhou Shanonda Holdings Co., Ltd. on behalf of the Group was RMB 256,405.7.
②at the end of the reporting period，the Group’s balance of deposits in the ChemChina Finance Co,. Ltd. was RMB 23,255,177.23,
bank deposit interest received this year was RMB 797,587.81 and interest on loans paid this year was RMB 2,108,500.00.
6. Accounts receivable and payable of related parties
Accounts receivable and prepaid of listed related parties
Unit: RMB Yuan
Closing amount Opening amount
Item Related party Bad-debt provisio
Book balance Book balance Bad-debt provision
n
ADAMA Agricultural
Account receivable 9,534,979.39 476,748.97 8,286,308.99 414,315.45
Solutions LTD.,
Hubei Jingzhou
Account receivable Huaxiang Chemical 10,184.50 509.23 18,200.00 910.00
Co., Ltd.
Sichuan BlueStar
Advance for projects 0.00 63,000.00
Machinery Co., Ltd.
Bluestar
Advance for projects Environmental 0.00 80,609.00
Engineering Co., Ltd.
Accounts payable Bluestar 13,500.00
127
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Environmental
Engineering Co., Ltd.
China Haohua
Advance for projects 17,741,838.70 17,760,000.00
Engineering Co., Ltd.
Bluestar (Beijing)
Accounts payable Chemical Machinery 906,800.00 105,700.00
Co., Ltd.
Bluestar (Beijing)
Advance for projects Chemical Machinery 5,580,000.00
Co., Ltd.
Shandong Dacheng
Accounts received in
Pesticide & Chemical 1,500.00 2,549,000.00
advance
Corporation
Accounts payable and received in advance of listed related parties
Unit: RMB Yuan
Item Related party Closing amount Opening amount
X. Share-based payments
Naught
XI. Contingencies
1. Contingent liability and financial impacts caused by pending action or arbitration
Naught
2. Contingent liability and financial impacts caused by provision of guarantee for other company
Unit: RMB Yuan
Total guarantee
Overdue Guarantee Current status of
Guarantor Secured entities amount Guarantee type
amount way secured entities
(RMB ’0000)
I. Guarantee for subsidiaries
Hubei Sanonda Foreign 32,900.00 Joint Guarantee for trade Business-as-usu
The
Trading Co., Ltd. liability financing loan al
Company
guarantee
Other contingencies
XII. Commitments
1. Significant commitments
As of 30, Jun, 2014, the Group has no significant commitments needed to be disclosed.
2. Fulfillment of the previous commitments
Please refer to Section V, X.
XIII. Events after the balance sheet date
1. Significant events after the balance sheet date
Naught
2. List of profits distribution events after the balance sheet date
Naught
128
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
3. Other assets and liabilities events after the balance sheet date
Naught
XIV. Other significant events
1. Non-monetary assets exchange
Naught
2. Debt restructuring
Naught
3. Business combination
Naught
4. Leasing
Naught
5. Financial instruments which is outstanding and can be converted into shares at the period-end
Naught
6. Main contents and significant changes of the pension plan
Naught
7. Others
Naught
8. Main content and significant change of employer annuity
Naught
9. Other
Naught
XV. Notes to the financial statements of Parent Company
1. Accounts receivable
(1) Accounts receivable
Unit: RMB Yuan
Closing balance Opening balance
Book value Provision for bad debts Book value Provision for bad debts
Items
Propo Proporti Proporti Proporti
Amount Amount Amount Amount
rtion on on on
Account receivable with consolidated provision for bad debt
91.20
Related group 526,299,420.40 190,215,339.25 94.89%
%
Aging group 50,776,628.28 8.80% 9,489,956.00 18.69% 10,236,055.25 5.11% 7,437,478.65 72.66%
99.95
Subtotal of consolidation 577,076,048.68 9,489,956.00 1.64% 200,451,394.50 99.85% 7,437,478.65 3.71%
%
Accounts receivable with
insignificant single
100.00 100.00
amount but independently 302,796.52 0.05% 302,796.52 302,796.52 0.15% 302,796.52
% %
withdrawn bad debts
provision
Total 577,378,845.20 -- 9,792,752.52 -- 200,754,191.02 -- 7,740,275.17 --
129
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Notes of categories of accounts receivable:
1. The Company defines an account receivable equivalent to or above RMB 5 million as an account receivable which is individually
significant.
2. Accounts receivable are divided into three categories by groups
(1) Related-party groups: Divided according to the related-party relation between the debtor and the Company (usually the
Company’s actual controller and other enterprises controlled by it);
(2) Risk-free groups: Divided according to the debtor’s reputation, the nature of the account, safeguard measures, etc. (usually
amounts due from the government for purchases, reserve funds for employees, deposits for contracts, accounts receivable arising
from guarantee terms, etc.);
(3) Account age groups: Divided according to ages of accounts receivable.
3. The Group carries out an independent impairment test on an account receivable which is individually insignificant but has the
following feature. If there is any objective evidence proving that the asset has been impaired (for instance, receivables over which
there exist disputes against the opposite parties or receivables concerning lawsuits and arbitrations; and receivables of which there are
obvious signs indicating that debtors may not be able to fulfill repayment obligations), the Group recognizes impairment loss and
makes bad-debt provisions according to the difference between the present value of the asset’s future cash flow and the asset’s book
value.
Accounts receivable with significant single amount and individually withdrawn bad debt provision
□Applicable √Inapplicable
In the groups, accounts receivable adopting aging analysis method to withdraw bad debt provision:
√ Applicable □ Inapplicable
Unit: RMB Yuan
Closing balance Opening balance
Book balance Book balance
Aging Provision for bad Provision for bad
Proporti Proporti
Amount debts Amount debts
on (%) on (%)
Within 1 year
Including: -- -- -- -- -- --
Within 1 year 43,308,228.53 85.29% 2,165,411.43 2,688,391.10 26.26% 134,419.55
1-2 years 0.46 0.00% 0.05 147,900.25 1.45% 14,790.03
2-3 years 110,148.25 0.22% 33,044.48 130,187.00 1.27% 39,056.10
Over 3 years 7,358,251.04 14.49% 7,291,500.04 7,269,576.90 71.02% 7,249,212.97
3 to 4 years 130,187.00 0.25% 65,093.50 40,727.86 0.40% 20,363.93
4 to 5 years 3,315.00 0.01% 1,657.50
Over 5 years 7,224,749.04 14.23% 7,224,749.04 7,228,849.04 70.62% 7,228,849.04
Total 50,776,628.28 -- 9,489,956.00 10,236,055.25 -- 7,437,478.65
In the groups, accounts receivable adopting balance percentage method to withdraw bad debt provision:
□ Applicable √ Inapplicable
130
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
In the groups, accounts receivable adopting other methods to withdraw bad debt provision:
√Applicable □ Inapplicable
Unit: RMB Yuan
Group name Book balance Provision for bad debts
The related party 526,299,420.40
Total 526,299,420.40
Accounts receivable with insignificant single amount but independently withdrawn bad debts provision
√Applicable □ Inapplicable
Unit: RMB Yuan
Withdrawing proportion
Account receivable Balance of book value Provision for bad debt Reason for withdrawal
(%)
Jiangxi Nanchang
Honggu Plant Protection 302,796.52 302,796.52 100.00% Estimated unrecoverable
Center
Total 302,796.52 302,796.52 -- --
(2) No accounts receivable reversed or recovered in the reporting period
Naught
(3) No accounts receivable that written off in the reporting period
Naught
(4) No shareholders with more than 5% (including 5%) of the voting shares of the Company in accounts
receivable in reporting period
Naught
（5）Nature or content of other receivables with large amounts
Other receivables with large amounts mainly were current payment of subsidiary.
（6）Accounts receivable due to the top five entities
Unit: RMB Yuan
Proportion of the total
Relationship with the
Entity Amount term amount of account
Company
receivable
Sanonda Foreign Trading Related party within the
409,368,374.46 Within one year 70.90%
Co., Ltd. scope of merger
Jingzhou Hongxiang Related party within the 116,931,045.94 Within one year 20.25%
131
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Chemical Co., Ltd. scope of merger
Yunnan Kunming
Independent third party 3,736,027.50 Within one year 0.65%
Pesticide Co., Ltd.
Xinjiang Weinong
Technology Independent third party 2,690,425.40 Within one year 0.47%
Development Co., Ltd.
Hubei Weifeng
Agrochemical Independent third party 2,000,765.14 Within one year 0.35%
Technology Co., Ltd.
Total -- 534,726,638.44 -- 92.62%
（7）Accounts receivable due to the related parties
Unit: RMB Yuan
Occupancy rate of the total
Name of company Relationship with the Company Amount amount of accounts receivable
(%)
Hubei Sanonda Foreign
Subsidiary of the company 409,368,374.46 70.90%
Trading Co., Ltd.
Jingzhou Hongxiang
Subsidiary of the company 116,931,045.94 20.25%
Chemicals Co., Ltd.
Under the same control of the
Jiamusi Heilong
Chinese chemical industry 1,089,980.00 0.19%
Agrochemicals Co., Ltd.
group co., LTD
Hubei Jingzhou Huaxiang Associated enterprise of the
10,184.50 0.00%
Chemicals Co., Ltd. parent company
Total -- 527,399,584.90 91.34%
（8）Transfer amount of account receivable not qualify for derecognization conditions was RMB 0.00
（9）Account receivable for the asset securitization need to briefly explain Related arrangement
Naught
2. Other accounts receivable
（1）Other accounts receivable
Unit: RMB Yuan
Closing balance Opening balance
Category
Book balance Bad debt provision Book balance Bad debt provision
132
2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Propo Propo Propo Propo
Amount rtion Amount rtion Amount rtion Amount rtion
(%) (%) (%) (%)
Other accounts receivable withdrawn for provision of bad debt in the groups
91.45 93.52
Related-party group 70,874,898.62 140,600,651.57
% %
81.67 56.16
Aging group 6,628,911.18 8.55% 5,414,036.23 9,744,815.75 6.48% 5,472,766.05
% %
100.0 100.0
Subtotal of the group 77,503,809.80 5,414,036.23 6.99% 150,345,467.32 5,472,766.05 3.64%
0% 0%
Total 77,503,809.80 -- 5,414,036.23 -- 150,345,467.32 -- 5,472,766.05 --
Explanation on categories of other accounts receivable
Other accounts receivable with insignificant single amount but independently withdrawn bad debts provision at
period-end
□ Applicable √ Inapplicable
In the group, other accounts receivable withdrawn bad debt provision by adopting aging analysis
√Applicable □ Inapplicable
Unit: RMB Yuan
Closing balance Opening balance
Book balance Book balance
Age
Proporti Bad debt provision Proporti Bad debt provision
Amount Amount
on (%) on (%)
Within 1 year
Including: -- -- -- -- -- --
Subtotal within
355,558.35 5.36% 17,777.92 4,157,102.92 42.66% 207,855.15
1 year
1-2 years 692,000.00 10.44% 69,200.00 330,784.57 3.39% 33,078.46
2-3 years 330,784.57 4.99% 99,235.37 11,290.00 0.12% 3,387.00
Over 3 years 5,250,568.26 79.21% 5,227,822.94 5,245,638.26 53.83% 5,228,445.44
3-4 years 11,105.00 0.17% 5,552.50 34,385.65 0.35% 17,192.83
4-5 years 34,385.65 0.52% 17,192.83
Over 5 years 5,205,077.61 78.52% 5,205,077.61 5,211,252.61 53.48% 5,211,252.61
Total 6,628,911.18 -- 5,414,036.23 9,744,815.75 -- 5,472,766.05
□ Applicable √ Inapplicable In the group, the other accounts receivable using balance percentage method for
withdrawing provisions for bad debt:
In the group, the accounts receivable were using other methods for withdrawing provisions for bad debt:
√Applicable □Inapplicable
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Unit: RMB Yuan
Name of group Book balance Bad debt provision
Related-party group 70,874,898.62
Total 70,874,898.62
Other accounts receivable with insignificant single amount but independently withdrawn bad debts provision:
□ Applicable √ Inapplicable
(2) Other accounts receivable returned or collected during the reporting period
Naught
(3) No accounts receivable actual offset during the reporting period
Naught
(4) Other accounts receivable due from shareholders with 5% (including 5%) voting right of the Company
during the reporting period
Naught
(5) Nature or content of other accounts receivable with significant amount
Naught
(6) Other accounts receivable due to the top five entities
Unit: RMB Yuan
Proportion in the total
Relationship with the
Name of entity Amount Years other accounts receivable
Company
(%)
Jingzhou Hongxiang
Related party 70,000,000.00 1-2year 90.32%
Chemicals Co., Ltd.
Shantou Biyue Plastic
Non-related party 3,125,000.00 Over 5 year 4.03%
Co., Ltd.
Sanonda (Jingzhou)
Pesticide & Chemicals Related party 874,898.62 Within one year 1.13%
Co., Ltd.
Hubei Jingzhou Shashi
Agricultural Means of Non-related party 548,500.00 Over 5 year 0.71%
Production Co., Ltd.
Railway Station Non-related party 410,141.19 1-2year 0.53%
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Total -- 74,958,539.81 -- 96.72%
(7) Other accounts receivable due to the related parties
Unit: RMB Yuan
Proportion in the total other
Name of entity Relationship with the Company Amount
accounts receivable (%)
Sanonda (Jingzhou) Pesticide
Subsidiary of the company 874,898.62 1.13%
& Chemicals Co., Ltd.
Jingzhou Hongxiang
Subsidiary of the company 70,000,000.00 90.32%
Chemicals Co., Ltd.
Total -- 70,874,898.62 91.45%
（8）Transfer amount of account receivable not qualify for derecognization conditions was RMB 0.00
（9）Account receivable for the asset securitization need to briefly explain Related arrangement
Naught
3. Long-term equity investment
Unit: RMB Yuan
Reasons
for
inconfor
mity Withdraw
Sharehold Voting
between al of
Increasin ing power Cash
Accounti Initial Sharehold Depreciat depreciati
Opening g or Closing proportio proportio dividends
Investee ng investmen ing ion on
balance decreasin balance n for n for for this
method t cost proportio reserves reserves
g amount investee investee period
n and for this
(%) (%)
Voting period
power
proportio
n
Sanonda
(Jingzhou
)
Cost 30,413,70 30,413,70 30,413,70 24,500,00
Pesticide 100.00% 100.00%
method 0.00 0.00 0.00 0.00
&
Chemical
s Co.,
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Ltd.
Hubei
Sanonda
Cost 11,993,03 11,993,03 11,993,03
Foreign 100.00% 100.00%
method 0.00 0.00 0.00
Trading
Co., Ltd.
Hubei Cost 20,000,00 20,000,00 20,000,00 11,991,01
0.71% 0.71%
Bank method 0.00 0.00 0.00 7.37
Hubei
Shendian
Cost 564,000.0 564,000.0 564,000.0
Auto 0.60% 0.60%
method 0 0 0
Motor
Co., Ltd
Guangxi
Zhongdin Cost 580,800.0 580,800.0 580,800.0
1.41% 1.41%
g Holding method 0 0 0
Co., Ltd
Jingzhou
Hongxian
g Cost 37,619,90 37,619,90 37,619,90
98.50% 98.50%
Chemical method 5.41 5.41 5.41
s Co.,
Ltd.
101,171,4 101,171,4 101,171,4 36,491,01
Total -- -- -- --
35.41 35.41 35.41 7.37
Note
4. Operating revenue and operating cost
(1) Operating revenue
Unit: RMB Yuan
Item Amount of this period Amount of last period
Main operation revenue 1,656,193,498.88 1,460,017,357.58
Other operation revenue 30,572,387.74 36,547,430.39
Total 1,686,765,886.62 1,496,564,787.97
Main operating cost 1,171,797,949.08 1,204,298,974.60
(2) Main business (classified by industries)
Unit: RMB Yuan
Name of Industries Amount of this period Amount of last period
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Operating revenue Operating cost Operating revenue Operating cost
Manufacturing of chemical
1,656,193,498.88 1,145,555,009.95 1,460,017,357.58 1,174,092,436.40
raw material and chemicals
Total 1,656,193,498.88 1,145,555,009.95 1,460,017,357.58 1,174,092,436.40
(3) Main business (classified by products)
Unit: RMB Yuan
Amount of this period Amount of last period
Name of Products
Operating revenue Operating cost Operating revenue Operating cost
Agrochemicals such as
chemical fertilizer and 1,647,622,148.45 1,140,130,365.75 1,451,653,596.88 1,169,371,039.84
pesticide
New chemical material and
8,571,350.43 5,424,644.20 8,363,760.70 4,721,396.56
special chemicals
Total 1,656,193,498.88 1,145,555,009.95 1,460,017,357.58 1,174,092,436.40
(4) Main business (classified by regions)
Unit: RMB Yuan
Amount of this period Amount of last period
Name of region
Operating revenue Operating cost Operating revenue Operating cost
Domestic 711,882,010.95 506,098,634.19 746,239,308.85 583,055,078.00
Overseas 944,311,487.93 639,456,375.76 713,778,048.73 591,037,358.40
Total 1,656,193,498.88 1,145,555,009.95 1,460,017,357.58 1,174,092,436.40
(5) Operating revenue from the top five customers of the Company
Unit: RMB Yuan
Proportion in total
Name of customer Total operating revenue
operating revenue (%)
Foreign customer A 220,136,215.76 13.05%
Foreign customer B 126,802,492.82 7.52%
Foreign customer C 93,748,927.03 5.56%
Foreign customer D 71,332,949.00 4.23%
Domestic customer E 53,459,070.80 3.17%
Total 565,479,655.41 33.53%
Note
5. Investment income
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
(1) Details of investment income
Unit: RMB Yuan
Item Amount of this period Amount of last period
Long-term equity investment income assessed by cost
2,904,182.43
method
Total 2,904,182.43
(2) Long-term equity investment income assessed by cost method
Unit: RMB Yuan
Amount of last Reasons for the change of
Investee Amount of this period
period increase/decrease
Jingzhou Longhua Petrochemicals Co., Ltd. 650,000.00
Hubei Bank 2,254,182.43
Total 2,904,182.43 --
(3) Long-term equity investment income assessed by equity method
Naught
6. Supplementary information to cash flow statement
Unit: RMB Yuan
Item Amount of this period Amount of last period
1. Reconciliation of net profit to net cash flows generated from
-- --
operating activities
Net profit 304,958,733.14 133,618,521.52
Add: Provision for impairment of assets 3,070,529.98 1,928,293.40
Depreciation of fixed assets, of oil-gas assets, of productive
77,549,544.00 75,545,987.60
biological assets
Amortization of intangible assets 1,871,736.54 1,871,736.54
Losses on disposal of fixed assets, intangible assets and other
-10,937.44 143,522.51
long-term assets (gains: negative)
Financial cost (gains: negative) 23,040,663.43 35,999,561.54
Investment loss (gains: negative) -2,904,182.43
Decrease in deferred income tax assets (gains: negative) 86,818.62 -671,862.52
Decrease in inventory (gains: negative) -60,871,178.03 26,008,009.05
Decrease in accounts receivable from operating activities (gains:
-292,022,584.39 -70,194,773.24
negative)
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
Increase in payables from operating activities (decrease: negative) 227,044,170.95 249,541,315.12
Net cash flows generated from operating activities 284,717,496.80 450,886,129.09
II. Investing and financing activities that do not involving
-- --
cash receipts and payment:
III. Net increase in cash and cash equivalents -- --
Closing balance of cash 362,812,604.82 437,060,777.43
Less: Opening balance of cash 325,849,120.35 149,485,252.01
Net increase in cash and cash equivalents 36,963,484.47 287,575,525.42
7. Assets and liabilities in assessed value under reverse purchase
Naught
XIV. Supplementary information
1 Items and amounts of extraordinary gains and losses
Unit: RMB Yuan
Item Amount Note
Gain/loss on the disposal of non-current assets (including the
12,201.92
offset part of the asset impairment provisions)
Government grants recognized in the current period, except for
those acquired in the ordinary course of business or granted at
1,367,962.96
certain quotas or amounts according to the government’s unified
standards
Non-operating income and expense other than the above -210,649.48
Income tax effects 301,132.73
Minority interests effects (after tax) -450.00
Total 868,832.67 --
Government grants recognized in the current period was recurrent profit and loss item, shall specify disclosure reason item by item.
□ Applicable √ Inapplicable
2. Differences between accounting data under domestic and overseas accounting standards
(1) Differences of net profit and net assets disclosed in financial reports prepared under international and
Chinese accounting standards
Unit: RMB Yuan
Net profit attributable to shareholders of the Net assets attributable to shareholders of the
Company Company
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
2014 2013 Closing amount Opening amount
According to Chinese
288,406,597.13 127,470,524.25 1,809,332,795.25 1,546,189,571.66
accounting standards
Items and amounts adjusted according to international accounting standards
(2) Differences of net profit and net assets disclosed in financial reports prepared under overseas and
Chinese accounting standards
Unit: RMB Yuan
Net profit attributable to shareholders of the Net assets attributable to shareholders of the
Company Company
2014 2013 Closing amount Opening amount
According to Chinese
288,406,597.13 127,470,524.25 1,809,332,795.25 1,546,189,571.66
accounting standards
Items and amounts adjusted according to international accounting standards
(3) Explain reasons for the differences between accounting data under domestic and overseas accounting
standards
3. Return on equity and earnings per share
Unit: RMB Yuan
The weighted average ROE EPS
Profit in the reporting period
(%) Basic EPS Diluted EPS
Net profit attributable to the Company's
17.15% 0.4856 0.4856
common stock shareholders
Net profit attributable to shareholders of the
Company's common stock after deducting 17.09% 0.4841 0.4841
non-recurring gains and losses
4. Particulars on the abnormal conditions of main items in the financial statements of the Company and
relevant reasons
Unit: RMB Ten thousand
Yuan
Item 2014.6.30 2013.12.31 Increase /decrease amplitude
Note receivable 2,516 4,110 -38.78%
Account receivable 39,709 20,917 89.84%
Construction in process 39,056 23,449 66.56%
Account receivable in 4,234 7,944 -46.70%
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
advance
Commission paid to the 1,589 2,533 -37.27%
employee
Tax payable 9,871 7,334 34.59%
Non-current liabilities with 799 7,739 -89.68%
one year
Long-term loan 42,159 29,609 42.39%
Retained profit 80,540 54,669 47.32%
Note：
1. The note receivable decreased 38.78% compare to that in the opening period, mainly because the acceptance payment increased.
2. The account receivable increased 89.84% compare to that in the opening period, mainly because the export sales revenue
increased, and conducted settlement method with resource and long settlement period.
3. The construction in process increased 66.56% compare to that in the opening period, mainly because the engineering
construction investment increased.
4. The account receivable in advance decreased 46.70% compare to that in the opening period, mainly because customer payment
in advance decreased.
5. Commission paid to the employee decreased 37.27% compare to that in the opening period, mainly because the Company pay
partial insurance and commission.
6. The tax payable increased 34.59% compare to that in the opening period, mainly because the increase of profit cause the tax
payable increased.
7. The non-current liabilities with one year decreased 89.68% compare to that in the opening period, mainly because the Company
repaid some long-term loan of the non-current liabilities with one year.
8. The long-term loan increased 42.39% compare to that in the opening period, mainly because the Company newly increased
long-term loan of new project.
9. The retained profit increased 47.32% compare to that in the opening period, mainly because the profit increased.
Unit: RMB Ten thousand Yuan
Item 2014.6.30 2013.6.30 Increase
/decrease
amplitude
Operating tax and surcharge 362 106 242.93%
Asset impairment losses 1119 529 111.68%
Financial expenses 1,725 4,021 -57.10%
Non-operating expenses 28 280 -90.03%
Income tax expenses 10,499 4,397 138.77%
Net profits attributable to owners of the Company 28,841 12,747 126.25%
1. The operating tax and surcharge increased 242.93% on year-on-year basis, mainly because the tax payable increased compare
to the same period last year.
2. The asset impairment losses increased 111.68% on year-on-year basis, mainly because provision for accounts receivable
increased.
3. The financial expenses decreased 57.10% on year-on-year basis, mainly because the decrease of short term loan cause the
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
interest payable decreased.
4. The non-operating expenses decreased 90.03% on year-on-year basis, mainly because documentary credit interest expense
without right of recourse decreased.
5. The income tax expenses increased 138.77% on year-on-year basis, mainly because the total profit increased compare to the
same period last year and the income tax expenses increased in the reporting period.
6. The net profits attributable to owners of the Company increased 126.25% on year-on-year basis, mainly because the sales
revenue increased and the gross profit margin increased compare to the same period last year.
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2014 Semi-annual Report of Hubei Sanonda Co., Ltd.
X. Documents Available For Reference
(I) Financial Statements carried with signatures and seals of Legal Representative and Accounting Principal, as
well as Head of the Accounting Organ;
(II) In the reporting period, originals of all documents of the Company ever disclosed publicly in media
designated by China Securities Regulatory Commission as well as the originals of all the public notices were
deposited in the office of the Company.
143
