Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
Yantai Changyu Pioneer Wine Co. Ltd.
2014 Semi-annual Report
2014-Final 02
August 2014
1
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
Contents
2014 Semi-annual Report .................................................................................................................. 2
I、Important Notice, Contents and Definition................................................................................ 3
II、Brief Introduction for the Company ....................................................................................... 5
III、Summary of Accounting Data and Financial Indicators ..................................................... 7
IV、Board of Directors’ Report ..................................................................................................... 9
V、Major Issues ............................................................................................................................. 20
VI、Changes in Shares and the Shareholders’ Situation ........................................................... 29
VII、Relative situation for preferred shares................................................................................. 33
VIII、Situation for Directors, Supervisors, Senior Management ............................................. 34
IX、Financial Report .................................................................................................................... 35
X、Reference Documents.............................................................................................................. 131
2
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
I. Important Notice, Contents and Definition
The Board of Directors ， the Board of Supervisors ， directors, supervisors & senior
management of the Company collectively and individually accept full responsibility for the
truthfulness，accuracy and completeness of the information contained in the semi-annual
report and there are no unfaithful facts, misleading statements or significant omissions.
All directors have personally attended the Board of Directors’ meeting for deliberating the
semi-annual report.
The Company has no plan to distribute cash dividends and bonus shares; capital reserve will
not be transferred to equity in the semi-annual.
Mr. Sun Liqiang (Chairman of the Company), Mr. Leng Bin (Chief Financial Officer) and Mr.
Jiang Jianxun (Financial Manager) assure the truthfulness, accuracy and completeness of the
financial report in the semi-annual report.
This semi-annual report involves in forward-looking statements about future plan etc. It bases
mainly on the basic command of economic development trend of China and the judgment of
several years of experience in this industry, with a great uncertainty. The Company does not
give the investors tangible commitment, so the investors should be in a special attention, and
choose wisely.
3
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
Definition
Definition Item Refers to Definition Content
Company/The Company Refers to Yantai Changyu Pioneer Wine Co. Ltd.
Changyu Group/Controlling Refers to
Yantai Changyu Group Co. Ltd.
shareholder
CSRC Refers to China Securities Regulatory Commission
SSE Refers to Shenzhen Stock Exchange
CNY Refers to Chinese Yuan
4
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
II、Brief Introduction for the Company
1. Company’s information
Abbreviation of the Shares: Changyu A、Changyu B Code number of the Shares 000869、200869
Abbreviation of the Shares
-
after alteration
Place of listing of the Shares Shenzhen Stock Exchange
Legal Name in Chinese 烟台张裕葡萄酿酒股份有限公司
Abbreviation of Chinese name 张裕
Legal Name in English YANTAI CHANGYU PIONEER WINE COMPANY LIMITED
Abbreviation of English name CHANGYU
Legal Representative Mr. Sun Liqiang
2. Contact person and information
Secretary to the Board of Authorized Representative of the
Directors Securities Affairs
Name Mr. Qu Weimin Mr. Li Tingguo
Address 56 Dama Road, Yantai, Shandong, China 56 Dama Road, Yantai, Shandong, China
Tel 0086-535-6633658 0086-535-6633656
Fax 0086-535-6633639 0086-535-6633639
E-mail quwm@changyu.com.cn stock@changyu.com.cn
3. Other information
1)、The Company’s contact information
Whether there is any change for the Companys registered address, office address, post code,
website and e-mail address during the report period.
□Available V Not available
There is no any change for the Companys office address, post code, website and e-mail address
during the report period, please see 2013 annual report for more details.
2)、Information disclosure and filing Location
Whether there is any change for the information disclosure and filling location during the report
5
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
period.
□Available V Not available
There is no any change for the newspapers in which the Companys information is disclosed,
website assigned by CSRC to carry the semi-annual report and the filing location during the report
period, please see 2013 annual report for more details.
3)、Registration changes
Whether there is any change for the registration during the report period.
□Available V Not available
There is no any change for the companys registration date & place, business License No., tax
registration No. and organization code during the report period, please see 2013 annual report for
more details.
6
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
III、 Summary of Accounting Data and Financial Indicators
1. Key accounting data and financial indicators
Whether the Company makes retroactive adjustments or restates the accounting data of previous
fiscal years because of changes of accounting policy and/or accounting errors.
□Yes V No
More or less than
In the same period of
Item In the report period the same period of
last year
last year(%)
Business revenue (CNY) 2,301,990,248 2,539,378,234 -9.35%
Net profit attributed to the
shareholders of the listed 638,041,311 740,574,221 -13.85%
company (CNY)
Net profit attributed to the
shareholders of the listed
company after deducting the 629,900,854 736,714,423 -14.50%
irregular profit and loss (CNY)
Net cash flows from the
889,675,131 409,158,489 117.44%
operating activities (CNY)
Basic earnings (CNY) per share 0.93 1.08 -13.89%
Diluted earnings (CNY) per
0.93 1.08 -13.89%
share
Return on net assets (%) 9.77% 11.79% -2.02%
At the end of the At the end of last More or less than
report period year the end of last year
Total assets (CNY) 8,614,013,724 8,001,532,444 7.65%
Net Assets attributed to the
shareholders of the listed 6,846,051,413 6,208,279,705 10.27%
company (CNY)
2. Accounting data difference between domestic and foreign accounting standards
1)、Difference in net profit and net asset disclosed in the financial report under the PRC accounting
standards and international accounting standards.
□Available V Not available
There is no difference in net profit and net asset disclosed in the financial report under the PRC
accounting standards and international accounting standards during the report period.
7
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
2)、Difference in net profit and net asset disclosed in the financial report under the PRC accounting
standards and foreign accounting standards.
□Available V Not available
There is no difference in net profit and net asset disclosed in the financial report under the PRC
accounting standards and foreign accounting standards during the report period.
3. Details of irregular profit and loss
V Available □Not available
Unit: CNY
Item Amount Explanation
Gain on disposal of non-current assets, including
-10,897 -
the reversal of accrued impairment provision
Tax refund or exemption that is either
0 -
non-recurring or without proper approval
Government grants credited in profit and loss
(except for those recurring government grants
that are closely related to the entity's operation, 8,772,080 -
in line with related regulations and have proper
basis of calculation)
Other non-operating expense and income 478,097 -
Less: Income tax effect 1,098,823 -
Total 8,140,457 -
The reasons shall be made clear and definitely as to the non-recurring profit and loss that the Company
has defined by virtue of the Explanatory Announcement on Public Companys Information Disclosure
No.1 - Non-recurring Profit and Loss and as to regarding the non-recurring profit and loss as recurrent
profit and loss as specified in the Explanatory Announcement on Public Companys Information
Disclosure No.1 - Non-recurring Profit and Loss.
□Available V Not available
There is no situation regarding the non-recurring profit and loss as defined and specified in the
Explanatory Announcement on Public Companys Information Disclosure No.1 - Non-recurring
Profit and Loss as recurrent profit and loss.
8
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
IV、 Board of Directors’ Report
1. Summarization
During the report period, under the influence of multiple factors, such as slowdown of domestic
economic growth, overwhelming flow of foreign wine into Chinese market and the relative national
policies and so on, the competition in the domestic wine industry was fierce, especially there was a
great decline on the effective demands for the premium wines, which brought a strong
pressure to the Companys production and operation. Facing quite a lot of external
disadvantages, the Company insisted to focus on the market, in accordance with the trend of market
development, adjust the marketing tactics and product structure in time, constantly perfect the
marketing channels and promote product sales, so that to restrain the situation of decline in operating
results. In the second quarter (April, May, June), rebound of main business income and net profit in
different levels emerges, 14.86% and 6.23% respectively more than the same period in previous year;
Based on this, the company realized business income of CNY 2301.99 million, 9.35% less than the
same period in previous year; realized net profit of CNY 638.04 million, 13.85% less than the same
period in previous year. Both decline range diminished, compared with those in the first quarter.
2. Analysis to main business
Period comparison of main financial data
Unit: CNY
In the same
In the report More or
period of last Reason for changes
period less (%)
year
Mainly the decrease of sales revenue
Operating for the high-end cheteau wine,
2,301,990,248 2,539,378,234 -9.35%
revenue comparing with the same period of
last year.
Mainly the changes of sales products
structure, the proportion of high-end
products declining, the proportion of
Operating cost 754,302,386 759,692,089 -0.71% low grade products increasing, the
increased price of raw material
including grapes comparing with the
same period of last year
According to the market situation,
Sales expense 486,481,030 584,280,630 -16.74% appropriately compressing marketing
investment
9
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
Management
103,980,497 104,896,929 -0.87%
expense
Financial expense -14,254,385 -13,607,053 -4.76%
Mainly decreasing of net profit,
Income tax
210,241,876 244,475,516 -14% comparing with the same period of
expense
last year
Mainly increasing of expenditure of
R&D investment 5,436,054 5,342,521 1.75% R&D investment, comparing with the
same period of last year
Net amount of
cash flow
Mainly decreasing of cash outflow
generated in 889,675,131 409,158,489 117.44%
from various operating activities
operating
activities
Net amount of
cash flow
Mainly the decrease of cash used to
generated in -240,974,464 -502,430,760 52.04%
pay fixed deposit over 3 months
investment
activities
Net increased
Mainly increase of net amount of cash
amount of cash
648,662,711 -93,272,271 795.45% flow generated in operating and
and cash
investment activities
equivalents
Whether there is any great change for the Company’s profit structure or profit source during the report
period
□Available V Not available
There is no great change for the Companys profit structure or profit source during the report
period.
10
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
Whether there is any future development and planning disclosed in the public Company’s shares
prospectus, collecting prospectus and asset restructuring report during the report period.
□Available V Not available
The Company does not disclose any future development and planning in the public Companys
shares prospectus, collecting prospectus and asset restructuring report during the report period.
Review and summary of the progress situation during the report period of the company’s
business plan disclosed in earlier stage
During the report period, influenced by the abrupt change of market situation
and the great recession on the demand for the premium wines, in order to deal
with the unfavorable business environment, during the report period, the Company carried out the
operation strategy of steady development in the middle and high-end wines, and vigorous
expansion for the low-level wines, brandy and imported wines with own brands.
While making efforts to promote the development of middle and high-end wines, the
Company made an appropriate tilt on marketing resources to the low-level wines, brandy
and imported wines with own brands for meeting the market demand, which
effectively curb the decline on the business income. The main work in the report period is as
following:
Firstly, to perfect sales system construction, strengthen the marketing process management. The
Company has completed to reorganize and adjust all levels employees of sale team, set up
additionally prefecture-level city managers, strengthen management of salesperson classification,
perfect salesperson performance assessment method, which are better at arousing the motivation of
salesperson; to set up middle-small restaurant direct-supplying management company and Lanzhou,
Yinchuan and Xianyang direct-supplying company, further to expand direct-supplying business.; to
clear up and simplify companys existing products system, making core products system which
adapt to the future development much clearer; further to define major push for different kind of
products, strengthen marketing pertinence; through constructing the market work regulation of
contact point and examining sales terminal, to promote the full implementation and development of
the marketing strategy named “move towards terminal”.
Secondly, to continue the propulsion of informatization construction and management innovation.
The Company has completed the projects of the first and second phase of SAP system. SAP system
has been taken comprehensive on-line operation during the report period. Focusing on the
future development goals and the urgent and significant problems to solve on
management, production, technology and marketing, the Company proposed and
completed over 279 items of innovation and reasonable projects, which brought the
11
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
related works and management level to a new step.
Thirdly, to reinforce the management of cost and expense, making great efforts to improve
economic benefits. The Company has enforced the assessment of input-output ratio of
advertisement fee and capital occupation in the bulk wine, packing material and finished goods, so
that to reduce capital occupation and increase the efficiency and effectiveness in the use of funds;
has compressed production cost expense through the measures of centralized purchasing, packaging
improvements, packaging simplification, and cancelling commissioned processing, which helped to
reduce per ton of wine cost, and increase economic benefits.
Fourthly, to accelerate the research and development (R&D) of new technology, new procedure,
new products, steadily promote the construction of technological renovation projects. The Company
increased the input intensity of technology projects, strengthened R&D ability, and completed to
declare 3 items of scientific and technological achievements in state, provincial and city level, and
one item patent; By means of strict implementation of special audit and third-party supervision to
construction projects, projects quality, investment scale and construction progress have been
controlled preferably, and the main investment projects went well.
During the second half year of 2014, the Company will mainly fulfill the following work and measures
as follows:
Firstly, persist to drive the innovation of sales modes, strengthen to develop and control sales terminal.
The Company will optimize the current sales mode of dealers as the main part, properly enlarge the
scale of delivery dealers and direct trade, insist to the working system of contact point markets which
are managed by companys leaders, step up the development of sales terminal and management
intensity, and accelerate to promote the moving terminal management system construction, which will
provide technology supports and examination approach for terminal work and making great efforts to
grasp the products initiative in terminal sales.
Secondly, continue to reinforce the management of cost expenses, improve effects in the use of funds.
The company strengthens to budget management and refine assessment items, simplify products
packing, come into full effects of tray transportation, expand centralized purchasing of raw material,
optimize pricing model of purchasing grapes price etc, intensify the management control of main cost
expenses in production cost and sales expenses, increase the effect in the use of funds, add company
benefit.
Thirdly, ensure steady progress of investment projects, optimize the production structure, enlarge
production capacity and upgraded management level. In the light of 2014 capital expenditure plans
12
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
schedule, the Company steadily promote investment projects construction, strictly control the project
schedule and the investment budget, ensure good quality and construction safety of engineering, lay a
solid foundation for further improving production capacity and optimizing productivity structure;
accelerate implement and propulsion of SAP, reinforce the training of related staffs, improve preferably
the Companys management level and control ability by means of modern information technology.
Fourthly, to reinforce the management of the vineyard bases, perfect the work on grape purchase, the
Company will make further definition to the duty and division of administrators at all-levels vineyards
and grapes planters, strengthen the training and assessment of grape planters, reinforce to guide and
manage vineyards on site, encourage to popularize the mechanized farming, improve grape quality and
reduce the cost of raw materials; accomplish grape purchasing plans and implementation scheme,
organize and deploy internal resources scientifically, guarantee both quality and quantity to complete
acquisition grapes, ensure sufficient and quality grape material supply.
3. Structure of main businesses
Unit: CNY
Increase or Increase or Increase or
decrease of decrease of decrease of
Gross
Operating Operating operating operating cost gross profit
profit
revenue cost revenue over the over the same over the same
(%)
same period of period of last period of last
last year (%) year (%) year
Sector
Wine and
alcoholic 2,295,163,767 748,344,147 67.39% -9.44% -1.26% -2.70%
beverages
Product
Wine 1,765,168,335 553,653,304 68.63% -9.28% 4.52% -4.14%
Brandy 467,055,981 158,456,974 66.07% -4.69% -6.24% 0.56%
Sparkling
20,570,297 13,653,755 33.62% 2.01% 8.01% -3.69%
wine
13
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
Other 42,369,154 22,580,114 46.71% -45.95% -51.50% 6.10%
Region
Eastern
1,953,179,965 628,664,664 67.81% -9.56% -1.42% -2.66%
Region
Middle
233,339,819 82,589,404 64.61% -8.39% -0.67% -2.75%
Region
Western
108,643,983 37,090,079 65.86% -9.56% 0.08% -3.29%
Region
4. Analysis to core competitiveness
Compared with the participants in the arena of the Chinese wine sector, we believe that the Company is
provided with the following advantages:
Firstly, the Company has been enjoying a well-known wine brand since 120-odd years, both “Changyu”
and “Jiebaina” are Chinese famous trademarks that have strong influence and good reputation.
Secondly, the Company has set up a nationwide marketing network, formed a “three-level” marketing
network system mainly composed of the Companys salesmen and dealers, possessed the strong
marketing ability and market exploitation ability.
Thirdly, the Company has already had strong research strength and a product R&D system, owned the
only “State-level Wine R&D Center”, made mastery of advanced winemaking technology and
production processes, been powerful enough in product innovation and established a perfect quality
control system.
Fourthly, the Company is in possession of a lot of grape-growing bases to meet its future development,
having developed a great deal of vineyards in the most suitable areas for wine grape growing such as in
Shandong, Ningxia, Xinjiang, Liaoning, Hebei and Shaanxi, whose scales and structures have
generally met the Companys needs for development.
Fifthly, the Company has a great variety of products composed of all grades, its wine and brandy of
over 100 sorts can meet different consumers demands. The Company has taken the lead in the
domestic wine sector through rapid development in the past 10-odd years and has possessed
comparative superiority in the future competition.
All in all, the Company has built up a strong core competitive edge and obtained and maintained a
relatively dominant position in the long-term market competition.
5. Analysis to investments
1)、Situation for equity investment abroad
14
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
① Situation for investment abroad
□Available V Not available
During the report period, the company did not have investment abroad.
② Situation for holding equity of financial enterprises
□Available V Not available
During the report period, the company did not hold any equity of financial enterprises.
③ Situation for security investment
□Available V Not available
During the report period, there were no security investments.
2)、Trust management, derivatives investment and entrusted loans
① Situation for trust management
□Available V Not available
During the report period, the company did not have trust management.
② Situation for derivatives investment
□Available V Not available
During the report period, the company did not have derivatives investment.
③ Situation for entrusted loans
□Available V Not available
During the report period, the company did not have entrusted loans.
3)、Use of raised capital
① Use of total raised capital
□Available V Not available
② Commitment item of raised capital
□Available V Not available
③ Variation item of raised capital
□Available V Not available
During the report period, there were no commitment item of raised capital happened.
④ Item of raised capital
In the past three years, the Company did not raise capital through issuing stocks or bonds, also there
were no raised capital continuing to the report period.
4)、Analysis to the major subsidiaries and joint stock companies
V Available □Not available
Information about the major subsidiaries and joint stock companies
15
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
Unit: CNY
Company Company Main products or Registered Business Operating
Industry Total assets Net asset Net profit
name type services capital revenue profit
Yantai To research,
Changyu-
Wine and produce and sell
Castel Wine
alcoholic wine and USD 5
Chateau Co. Subsidiary 281,027,978 83,305,969 38,866,996 4,304,385 3,099,755
LTD. beverages sparkling wine million
industry as well as the
tourism service
Langfang Wine and
Castel-
Joint stock alcoholic To produce and USD
Changyu Wine 57,539,508 47,192,412 26,943,014 278,873 221,457
company beverages sell wine 6,108,818
Co. LTD.
industry
Yantai Kylin Subsidiary To produce and
Packaging Packaging CNY 15.41
sell packaging 69,018,458 25,737,428 33,965,786 1,658,705 1,247,891
Co. LTD. industry million
material
Beijing Subsidiary Wine and
Chateau To research,
alcoholic CNY 110
Changyu produce and sell 695,174,432 77,053,340 51,140,545 -9,040,788 -9,145,407
beverages million
AFIP Global brandy and wine
industry
Chateau Subsidiary Wine and
Liaoning
alcoholic To produce ice CNY 26.30
Changyu Ice 87,354,495 58,514,577 16,805,693 -4,614,383 -4,607,180
Wine Co., beverages wine million
Ltd. industry
Xinjiang Subsidiary Wine and To plant grape,
Tianzhu produce and sell CNY 75
alcoholic
Winery Co., grape juice, bulk 192,284,733 159,336,889 31,963,458 -2,703,625 -2,703,224
Ltd. beverages million
wine and fruit
industry wine
5)、Important projects financed with non-raised capital
V Available □Not available
Unit: CNY0000
Actual
accumulation
Total Investment
investment Project
Project Name Planned in the report Project benefits
until the end of progress
Investment period
the report
period
Construction of Changyu Reina Chateau Facilities have been
31,074 7,917 36,917 98% completed and put
Sha'anxi into production.
16
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
Facilities have been
Construction of Chateau Moser XV
24,415 2,800 26,800 97% completed and put
Ningxia
into production.
Facilities have been
Construction of Changyu Baron Balboa
23,343 1,876 28,876 98% completed and put
Chateau XinJiang
into production.
Construction of Changyu International Wine
65,331 11,000 38,000 55% 0
City blending and cooling Center
Construction of Changyu International Wine
46,736 3,000 28,500 60% 0
City Bottling Center
Construction of Changyu International
12,095 2,295 8,095 65% 0
Wine City Logistics Center
Construction of Changyu Vine and
20,000 5,000 8,200 40% 0
Wine Research Institute
Construction of Treasure Wine Chateau 14,545 6,940 9,545 65% 0
Investment in landscaping 5,000 1,394 2,487 50% 0
Construction of pioneer franchised store 10,000 1,661 1,661 15% 0
Total 252,539 43,883 189,081 -- --
Inquiry index in the designated website disclosed in the
No
temporary announcement
6. Forecast for the operation achievements from January to September of 2014
Caution and explanation for the prediction that the cumulative net profit from the beginning of the
year to the end of next report period could be in a loss or there will be in a great change comparing
with the same period of last year.
□Available V Not available
7. Explanation from the board of directors and the board of supervisors for the “Non-standard Audit
Report” issued by the accountant firm
The financial report of the semi-annual report is not audited by the accountant firm.
8. Explanation from the board of directors for the “Non-standard Audit Report” of last year
□Available V Not available
9. Implementation of profit distribution during the report period
The implementation or adjustment for the profit distribution policies during the report period,
17
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
especially the cash dividend plan and the scheme of increasing equity with capital reserve.
V Available □Not available
On July 5, 2014, the Company disclosed the Announcement of Dividend Distribution for the year
2013, according to which the Company would take the total capital stock 685,464,000 shares at that
time as a cardinal number to distribute CNY 5 in cash for per 10 shares to all stockholders (tax
included. After deduction of taxes, as to Stock A, QFII, RQFII as well as the individuals holding the
restricted reform-related shares and the restricted new shares and the investment fund holders would
enjoy CNY 4.5 per 10 shares. The differential dividend tax rates would be adopted for the
individuals holding the non-restricted reform-related shares, the non-restricted new shares and the
unlimited shares and the investment fund holders, CNY 4.75 for per 10 shares in advance and
afterwards depending on the investors reduction of shares, making up the difference according to
the actual shares held on the equity registration day. As to the non-resident enterprises other than
QFII and RQFII, the Company would neither withhold nor pay the income tax on their behalf but
the taxpayers should pay the tax in the place where the income is received. As to Stock B, the
non-resident enterprises would enjoy cash dividend CNY 4.5 for per 10 shares. The differential
dividend tax rates would be adopted for the inland (overseas) individual stockholders, CNY 4.75 for
per 10 shares in advance and afterwards depending on the investors reduction of shares, making up
the difference according to the actual shares held on the equity registration day.)
The share registration day of A Stock was on July 10, 2014 and the ex-dividend day was on July 11,
2014.
The last trading day of B Stock was on July 10, 2014, the share registration day was on July 15,
2014 and the ex-dividend day was on July 11, 2014.
The cash dividend for Stock A holders that the company entrusted China Securities Depository and
Clearing Corporation Limited Shenzhen Company to distribute was directly transferred to their
accounts via securities service company (or other depository department) on July 11, 2014. The cash
dividend for Stock B holders was directly transferred to their accounts via securities service company
or other depository department on July 15, 2014. The cash dividend enjoyed by Yantai Changyu Group
Co., Ltd. was directly paid by the Company at the same time.
Special explanation
Whether it is in accordance with the requirements of the regulation in the Articles of Association and the resolution of Yes
shareholders
Whether the distribution standard and proportion is clear and definite Yes
Whether the relative decision process and mechanism is complete Yes
Whether the independent directors perform their responsibilities and play the roles. Yes
Whether the small and middle shareholders have the chance to express their advices and appeals, as well as their Yes
lawful right and interest is in an enough protection.
Whether it is legal and transparent for the condition and process while adjusting and amending the cash dividends Yes
18
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
distribution policy.
10. Preliminary schemes of profit dividend and increasing equity with capital reserve during the report
period
□Available V Not available
There is no schemes of paying cash dividend, bonus share and increasing equity with capital during the
semi-annual period.
11. the Company’s Receptions, Studies and Visits
Type of Main discussed
Reception Reception
Reception time reception Reception object contents and the
place way
object information provided
Shuai hu from China International Fund
current business
Meeting Management Co., Ltd. Chen yu from
operation
2014.05.20 room of the Field survey Institution AEGON-INDUSTRIAL Fund Management
situation and
Company Co., Ltd. Cao Liyan from BOC international
other issues
(China) Limited
19
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
V、Major Issues
1. Corporate Governance Situation of the Company
The Company has according to relevant national laws and rules including the “Company Law of the
People’s Republic of China”, “Securities Law of the People’s Republic of China” , “Guidelines on
Corporate Governance of Listed Companies”, and also other laws and rules , constantly improved its
legal entity structure, legally conducted its activities. Currently, the Companys corporate governance is
in compliance with the Company Law and the relevant provisions of China Securities Regulatory
Commission.
2. Material litigation and arbitration
□ available √not available
There are no material litigation and arbitration during the report period.
3. Media’s doubts
□ available √not available
There are no common doubts issued by Media during the report period.
4. Bankruptcy reorganization
□ available √not available
There are no related issues of bankruptcy reorganization happened during the report period and until
the report period.
5. Transaction in Assets
1)、Acquisition of assets
□ available √not available
There is no acquisition of assets during the report period and until the report period.
2)、 Assets for sale
□ available √not available
There are no assets for sale during the report period and until the report period.
3)、Business merger
□ available √not available
There are no business merger happened in the report period and until the report period.
20
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
6. Implementations and influences of Company’s equity incentive
□ available √not available
There are no plans and implementations of Companys equity incentive during the report period.
21
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
7. Important related transactions
1)、Related transactions in relation to routine operations
√available □not available
Market
Pricing Amount of Settlement price of
Content of Price of Proportion in the
Type of related principle of related method of securabl Date of
Related party Interrelationship related related same kind of Disclosure index
transaction related transaction related e same disclosure
transaction transaction transaction (%)
transaction (CNY 0000) transaction transacti
on
Yantai Changyu Under the same Purchasing Purchasing On the base of Agreement
commodities liquor products market price, price
Wine Culture Parent Co. derivatives negotiated 253.6 0.34% Cash — 2014.04.26
Museum Company pricing
Yantai Changyu Under the same Purchasing Purchasing On the base of Agreement http://www.cninfo.co
Window of Wine Parent Co. commodities liquor products market price, price m.cn/information/co
26.9 0.04% Cash — 2014.04.26
City Co. derivatives negotiated mpanyinfo.html
pricing
Yantai Shenma Under the same Purchasing Purchasing On the base of Agreement
6,098.2 8.08% Cash — 2014.04.26
Packaging Co. Parent Co. commodities packing market price, price
22
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
materials negotiated
pricing
Yantai Changyu Under the same Purchasing Purchasing On the base of Agreement
Zhongya Medicine & Parent Co. commodities liquor products market price, price
117.6 0.16% Cash — 2014.04.26
Healthy Liquors Co., negotiated
Ltd pricing
Yantai Changyu Under the same Selling Selling liquor On the base of Agreement
Wine Culture Parent Co. commodities products market price, price
342.6 0.15% Cash — 2014.04.26
Museum Company negotiated
pricing
Yantai Changyu Under the same Selling Selling liquor On the base of Agreement
Window of Wine Parent Co. commodities products market price, price
434.9 0.19% Cash — 2014.04.26
City Co. negotiated
pricing
Yantai Changyu Under the same Selling Selling liquor On the base of Agreement
Zhongya Medicine & Parent Co. commodities products market price, price
42.7 0.02% Cash — 2014.04.26
Healthy Liquors Co., negotiated
Ltd pricing
Yantai Changyu Parent Co. Leased assets Leasing storage On the base of Agreement 292.9 0.14% Cash — 2014.04.26
23
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
Group Co. Ltd. and housing market price, price
negotiated
pricing
Yantai Changyu Parent Co. Intangible assets Permission to On the base of Agreement
Group Co. Ltd. licensed use use the market price, price
4,341.3 100% Cash — 2014.04.26
trademark negotiated
pricing
Yantai Changyu Parent Co. Intangible assets Permission to On the base of Agreement
Group Co. Ltd. licensed use use patents market price, price
2.5 100% Cash — 2014.04.26
negotiated
pricing
Total 11,953.2 —
The details of the large sales returns No
The total amount of the transaction will be expected according to its No
category and its actual performance during the report period
The reasons of big differences between the transaction price and the market No
reference price
2)、 Related transactions in asset procurement and sale
□ available √not available
24
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
There are no related transactions in asset procurement and sale during the report period.
3)、Important related transactions in joint external investment
□ available √not available
There are no important related transactions in joint external investment during the report period.
4)、Record of related credits and liabilities
√available □not available
Whether there is a record of non-operating related credits and liabilities.
□ Yes √ No
There is no record of non-operating related credits and liabilities.
5)、Other important related transactions
□ available √not available
There are no other important related transactions in the report period.
25
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
8. Controlling shareholder and related party in funds occupation situation of non-operating of
the Listed Company
□ available √not available
There are no situation in controlling shareholder and related party in funds occupation of
non-operating of the Listed Company.
9. Major and important contracts and execution results
1)、Trusteeship, contract and leasehold issues
① Trusteeship situation
□ available √not available
There are no trusteeships happened during the report period
② Contract situation
□ available √not available
There are no contract situation happened during the report period.
③ Leasehold situation
√available □not available
Leasehold situation explanation
On 1st January 2012, the Company set out the house leasing contract with the Parent company. On
the basis of this agreement, The Company leased property of the Parent company as business
purpose from 1st January,2012, The rent per year is CNY 5.858 million, the valid date of this
contract expires to 31st December 2016. From January to June of 2014, the Group Company ensures
the rent of the Parent company amount to CNY 2.929 million.
In January to June, 2016, the leasing between the Group Company and related parties takes up
28.25% of Group companys leasehold fee.
Project in gains and losses for the Company to achieve more than 10% of the total profit during the
report period.
□ available √ not available
There is no Project in gains and losses for the Company to achieve more than 10% of the total profit
during the report period.
2)、Guarantee situation
□ available √not available
There are no guarantees situation during the report period.
Violation situation of external guarantee
□ available √not available
There is no violation situation of external guarantee during the report period.
3)、 Other important contracts
□ available √not available
There are no other important contracts during the report period.
4) Other substantial transaction
26
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
□ available √not available
There is no other substantial transaction during the report period.
10. The commitments of the Company or shareholders of the Company holding more than 5%
during the report period or until the report period
√available □not available
Commit
Commitment Commitment
Commitments Commitment content ment Implementation
Party time
period
has been
Commitments at share reform - － 2006.03.11 3 years
fulfilled
Commitments made in acquisition
- - - -
report or equity changes report
Commitments at asset restructuring - - - -
According to "Trademark License Contract",
the Company will pay trademark royalty for
the "Changyu"products of Yantai Changyu
Commitments at the initial public Yantai Changyu In-process
Group Co., Ltd every year, Yantai Changyu 1997.05.18 Forever
offering or refinancing Group Co., Ltd performed
Group Co., Ltd will use trademark to
advertise Changyu trademarks and the
Contract products.
Yantai Changyu Has been
Non Intra-industry competition 1997.05.18 Forever
Group Co, Ltd performed
Commitments made to the minority
- - - -
shareholders of the Company
Commitment under timely
Yes
implementation or not
Specific reasons of not completing
the implementation and the next No
step
11. The appointment and dismissal of certified public accountants
√ Yes □ No
The Company will continue to appoint Deloitte HuaYong certified public accountants CO., LTD
(Special General Partnership) as the audit authority in 2014 with term employment period of one
year.
Whether or not semi-annual financial report has been audited.
□Yes √ No
27
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
12. Punishment and rectification
□ available √ not available
There is no punishment and rectification situation happened during the report period.
13. Withdrawal risk revelation of violating laws and rules
□ available √ not available
There is no withdrawal risk revelation of violating laws and rules during the report period.
14. Explanation for other significant matters
□ available √ not available
There are no other significant matters during the report period.
28
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
VI、Changes in Shares and the Shareholders’ Situation
1. Changes in shares
Unit: Share
Amount before this change Change (+, -) Amount after this change
Transfer
Percentage Allot Distribut other capital Sub Percentage
Amount new e bonus others Amount
% to share total %
share share
capital
2、Unrestricted shares 685,464,000 100% 685,464,000 100%
(1)、A shares 453,460,800 66.15% 453,460,800 66.15%
(2)、B shares 232,003,200 33.85% 232,003,200 33.85%
3、Total shares 685,464,000 100% 685,464,000 100%
Cause of share change
□ available √ not available
Approval of stock change
□ available √ not available
Transfer of changed shares
□ available √ not available
The influence of stock change on the financial indicators such as basic earnings per share, diluted
earnings per share of the latest year and the latest period, net asset per share belonging to the
Companys common stock holders, etc..
□available √not available
Other contents which the Company thinks necessarily or securities regulatory departments claim to
disclose.
□available √not available
Changes situation in the Companys total shares, structure of shareholders, the Companys assets
and liabilities
□available √not available
29
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
2. The number of shareholders of the Company and the shareholdings
Unit: share
Total 47385
Total shareholders in the report period 36242 shareholders of A share
11143 shareholders of B share
Shareholders holding more than 5% or become a top 10 shareholders.
Number Pledged or frozen
Changes
Shares held of Number of
Percenta
Character of until the end during the
Name of Shareholders ge restricte unrestricted Amou
shareholders of the report report Share status
(%) d shares
period nt
period
shares
Domestic
YANTAI CHANGYU GROUP CO.
non-state-owned 50.40% 345,473,856 0 0 345,473,856 - 0
LTD.
legal person
Foreign
GAOLING FUND,L.P. 3.53% 24,176,997 0 0 24,176,997 0
shareholder
Foreign
GIC PRIVATE LIMITED 2.69% 18,456,155 -764,818 0 18,456,155 0
shareholder
BBH BOS S/A FIDELITY FD - Foreign
2.35% 16,106,326 0 0 16,106,326 0
CHINA FOCUS FD shareholder
GSIC A/C MONETARY Foreign
0.89% 6,085,399 -16,541 0 6,085,399 0
AUTHORITY OF SINGAPORE shareholder
BBH A/C VANGUARD EMERGING Foreign
shareholder 0.68% 4,651,666 -55,400 0 4,651,666 0
MARKETS STOCK INDEX FUND
BBH S/A FIDELITY FUNDS Foreign
0.63% 4,306,656 -284,826 0 4,306,656 0
SICAV-HEALTH CARE shareholder
VALUE PARTNERS Foreign
0.62% 4,280,146 -1,686,735 0 4,280,146 0
HIGH-DIVIDEND STOCKS FUNDS shareholder
Foreign
NORGES BANK 0.61% 4,171,564 2,483,576 0 4,171,564 0
shareholder
FIDELITY CHINA SPECIAL Foreign
0.55% 3,779,202 0 0 3,779,202 0
SITUATIONS PLC shareholder
Strategic investors or legal result of the placement of
No
new shares to become a top 10 shareholders
Among the top 10 shareholders, Yantai Changyu Group Company Limited has no
The explanation for the associated relationship and
associated relationship or accordant action relationship with the other 9 listed
accordant action of the top 10 shareholders
shareholders, and the relationship among the other shareholders is unknown.
The top 10 shareholders with unrestricted shares
30
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
Number of Type of share
unrestricted
Name of Shareholders shares held until
Type of share Amount
the end of the
report period
YANTAI CHANGYU GROUP CO., LTD. 345,473,856 A share 345,473,856
GAOLING FUND,L.P. 24,176,997 B share 24,176,997
GIC PRIVATE LIMITED 18,456,155 B share 18,456,155
BBH BOS S/A FIDELITY FD - CHINA FOCUS FD 16,106,326 B share 16,106,326
GSIC A/C MONETARY AUTHORITY OF SINGAPORE 6,085,399 B share 6,085,399
BBH A/C VANGUARD EMERGING MARKETS STOCK INDEX FUND 4,651,666 B share 4,651,666
BBH S/A FIDELITY FUNDS SICAV-HEALTH CARE 4,306,656 B share 4,306,656
VALUE PARTNERS HIGH-DIVIDEND STOCKS FUNDS 4,280,146 B share 4,280,146
NORGES BANK 4,171,564 B share 4,171,564
FIDELITY CHINA SPECIAL SITUATIONS PLC 3,779,202 B share 3,779,202
Among the top 10 shareholders, Yantai Changyu
The explanation for the associated relationship and accordant action of the top 10
Group Company Limited has no associated
shareholders with unrestricted shares, the the associated relationship and accordant
relationship or accordant action relationship with the
action between the top 10 shareholders with unrestricted shares and the top 10
other 9 listed shareholders, and the relationship
shareholders
among the other shareholders is unknown.
Explanation for the Top 10 shareholders who involved in financing activities and The top 10 Shareholders is not involved in financing
stock trading business activities and stock trading business.
Whether or not to be agreed to buy back trading by Company shareholders during the report period
□ Yes √ No
There is no agreed to buy back trading by Company shareholders during the report period.
3. Controlling shareholder or changes of the actual controllers situation
Changes of the controlling shareholder during the report period
□ available √ not available
There is no any change of the controlling shareholder during the report period.
Changes of the actual controllers during the report period
□ available √ not available
There is no any Change of the actual controllers during the report period
31
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
4. Company’s shareholders and Consistent behavior person offer or carry out the plan of
increasing rights issue during the period.
□ available √ not available
In the context of Company known, Companys shareholders and Consistent behavior person did not
offer or carry out the plan of increasing rights issue during the period.
32
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
VII Relative situation for preferred Shares
1. Issue and listing situation for preferred shares during the report period.
□ available √ not available
2. Situation for number and share holding of preferred shares shareholders
□ available √ not available
3. Situation for buy-back or conversion of preferred shares
1)、Situation for preferred shares buy-back
□ available √ not available
2）、Situation for preferred shares conversion
□ available √ not available
4. Situation for recovering and performing of preferred shares voting right
□ available √ not available
5. Accounting policy adopted in preferred shares and justification
□ available √ not available
33
Yantai Changyu Pioneer Wine Co. Ltd. 2014 Semi-annual Report
VIII、Situation for Directors, Supervisors, Senior Management
1. Changes in shareholdings of directors, supervisors and senior management
□ available √ not available
There are no any change in shareholdings of directors, supervisors and senior management during
the report period, details see 2013 annual report
2. Personnel changes in Company's directors, supervisors and senior management
√available □not available
Name Post Type Date Reason
Jean Paul Pinard Director Leave his
2014.05.23 Work changes
post
Director
Elected by the shareholders
Dai Hui Appointment 2014.05.23
meeting of 2013
Independent Director Elected by the shareholders
Wang Zhuquan Appointment 2014.05.23
meeting of 2013
34
Full Text of 2014 Semiannual Financial Report of Yantai Changyu Pioneer Wine Co., Ltd.
IX、Financial Report
1. Audit report
Whether the biannual report has been audited
□ Yes √ No
2. Financial statement
The unit in the statement of the financial annotations is RMB Yuan.
2.1 Consolidated balance sheet
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd.
Unit: Yuan
Item Note Ending balance Beginning balance
Current assets:
Monetary fund 7.1 1,861,541,927 1,367,818,182
Settlement provisions
Lending
Trading financial assets
Bills receivable 7.2 270,389,669 79,702,753
Accounts receivables 7.4 125,882,945 177,109,516
Advances to suppliers 7.6 12,631,073 45,997,863
Premium receivable
Reinsurance accounts receivable
Receivable reserves for reinsurance contract
Interest receivable 7.3 6,478,263 8,417,995
Dividends receivable
Other receivables 7.5 94,629,107 99,331,794
Buy-in/sell-out financial assets
Inventories 7.7 1,763,353,132 2,121,117,437
Non-current asset expire in a year
Other current assets
Total current assets 4,134,906,116 3,899,495,540
Non-current assets:
35
Full Text of 2014 Semiannual Financial Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Note Ending balance Beginning balance
Offering loans and imprest
Available for sale financial assets
Held-to-maturity investment
Long-term receivables
Long-term equity investments 7.8
Investment real estate
Property, plant and equipment 7.9 1,983,240,508 1,917,641,344
Construction in progress 7.10 1,688,554,603 1,423,654,530
Construction materials 676,539
Fixed assets disposal
Biological assets 7.11 123,118,338 101,794,515
Oil and gas assets
Intangible assets 7.12 299,188,896 296,129,754
Development expenditure
Goodwill 7.13 13,112,525 13,112,525
Long-term prepaid expense 7.14 176,253,868 165,521,803
Deferred tax assets 7.15 170,919,442 158,533,090
Other non-current assets 7.17 24,719,428 24,972,804
Total non-current assets 4,479,107,608 4,102,036,904
Total assets 8,614,013,724 8,001,532,444
Current liabilities:
Short-term loan 7.18 243,170,674 243,170,674
Borrowings from the Central Bank
Customer and interbank deposits
Borrowing funds
Trading of financial liabilities
Bills payable 7.19 1,670,000 5,765,694
Accounts payables 7.20 260,590,660 258,116,331
Advances from customers 7.21 297,711,405 188,651,254
Sales/buyback financial assets
Payable handling fees and commission
Employee benefits 7.22 131,853,776 134,322,137
Taxes payable 7.23 63,377,377 194,413,430
Interest payable 7.24 4,279,802 2,152,059
36
Full Text of 2014 Semiannual Financial Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Note Ending balance Beginning balance
Dividends payable
Other payables 7.25 502,406,987 497,301,630
Dividend payable for reinsurance
Reserves for insurance contracts
Acting trading securities
Acting underwriting securities
Non-current liability expire in a year
Other current liabilities 7.26 12,545,801 12,915,801
Total current liabilities 1,517,606,482 1,536,809,010
Non-current liabilities:
Long-term borrowings
Bonds payable
Long-term accounts payable
Special accounts payable
Estimated liabilities
Deferred tax liabilities 7.14 5,336,115 5,336,115
Other non-current liabilities 7.27 82,278,935 88,366,835
Total non-current liabilities 87,615,050 93,702,950
Total liabilities 1,605,221,532 1,630,511,960
Owner’s equity (or shareholders’ equity):
Paid-in capital (or capital stock) 7.28 685,464,000 685,464,000
Capital surplus 7.29 563,139,042 563,139,042
Minus: treasury stock
Special reserves
Surplus reserve 7.30 342,732,000 342,732,000
General risk preparation
Retained earnings 7.31 5,254,985,974 4,616,944,663
Converted difference in foreign currency statements -269,603
Total owners equity attributable to the parent company 6,846,051,413 6,208,279,705
Minority interests 162,740,779 162,740,779
Total owners equities (or shareholders equities) 7,008,792,192 6,371,020,484
Total liabilities and owners equities (or shareholders equities) 8,614,013,724 8,001,532,444
37
Full Text of 2014 Semiannual Financial Report of Yantai Changyu Pioneer Wine Co., Ltd.
The Legal Representative: Sun Liqiang Accounting Supervisor: Leng Bin Accounting Department Manager: Jiang Jianxun
2.2 Balance sheet of the parent company
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd.
Unit: Yuan
Item Note Ending balance Beginning balance
Current assets:
Monetary fund 850,751,619 602,444,243
Trading financial assets
Bills receivable 150,131,330 32,594,381
Accounts receivables 15.1 1,600,968
Advances to suppliers 2,418,842 24,824,672
Interest receivable 6,478,263 8,417,995
Dividends receivable 752,595,884 752,595,884
Other receivables 15.2 3,374,503,872 3,709,583,949
Inventories 681,914,073 781,284,189
Non-current asset expire in a year
Other current assets
Total current assets 5,818,793,883 5,913,346,281
Non-current assets:
Available for sale financial assets
Held-to-maturity investment
Long-term receivables
Long-term equity investments 15.3 1,048,208,923 1,048,208,923
Investment real estate
Property, plant and equipment 416,731,108 425,294,116
Construction in progress 650,821 269,802
Construction materials
Fixed assets disposal
Biological assets 75,047,957 60,851,409
Oil and gas assets
Intangible assets 77,953,293 79,139,831
Development expenditure
Goodwill
Long-term prepaid expense
Deferred tax assets 18,394,100 22,956,747
Other non-current assets 2,464,762 2,616,525
Total non-current assets 1,639,450,964 1,639,337,353
38
Full Text of 2014 Semiannual Financial Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Note Ending balance Beginning balance
Total assets 7,458,244,847 7,552,683,634
Current liabilities:
Short-term loan 243,170,674 243,170,674
Trading of financial liabilities
Bills payable
Accounts payables 155,823,881 166,453,563
Advances from customers
Employee benefits 82,441,312 69,032,912
Taxes payable -2,740,970 37,578,670
Interest payable 4,279,802 2,152,059
Dividends payable
Other payables 1,481,112,201 1,612,596,521
Non-current liability expire in a year
Other current liabilities 2,559,227 2,559,227
Total current liabilities 1,966,646,127 2,133,543,626
Non-current liabilities:
Long-term borrowings
Bonds payable
Long-term accounts payable
Special accounts payable
Estimated liabilities
Deferred tax liabilities
Other non-current liabilities 20,995,849 22,275,462
Total non-current liabilities 20,995,849 22,275,462
Total liabilities 1,987,641,976 2,155,819,088
Owner’s equity (or shareholders’ equity):
Paid-in capital (or capital stock) 685,464,000 685,464,000
Capital surplus 557,222,454 557,222,454
Minus: treasury stock
Appropriative reserve
Surplus reserve 342,732,000 342,732,000
General risk preparation
Retained earnings 3,885,184,417 3,811,446,092
Converted difference in foreign currency statements
Total owners equities (or shareholders equities) 5,470,602,871 5,396,864,546
Total liabilities and owners equities (or shareholders equities) 7,458,244,847 7,552,683,634
39
Full Text of 2014 Semiannual Financial Report of Yantai Changyu Pioneer Wine Co., Ltd.
The Legal Representative: Sun Liqiang Accounting Supervisor: Leng Bin Accounting Department Manager: Jiang Jianxun
2.3 Consolidated profit statement
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd.
Unit: Yuan
Item Note Sum of current period Sum of prior period
1. Revenue 2,301,990,248 2,539,378,234
Including: Operating income 7.32 2,301,990,248 2,539,378,234
Interest income
Earned premium
Handling fees and commission income
2. Total operating costs 1,462,946,341 1,558,864,572
Including: Operating costs 7.32 754,302,386 759,692,089
Interest expenditure
Handling fees and commission expenditure
Premium rebate
Net amount of indemnity expenditure
Net amount of insurance contract reserve fund withdrawal
Policy bonus payment
Amortized reinsurance expenditures
Taxes and surcharges 7.33 132,436,813 123,601,977
Selling expenses 7.34 486,481,030 584,280,630
Administrative expenses 7.35 103,980,497 104,896,929
Financial expenses 7.36 -14,254,385 -13,607,053
Loss for impairment of assets
Plus: Fair value charge profit (loss is listed with "-")
Investment profit (loss is listed with "-")
Including: investment profit for joint-run business and joint venture
Exchange income (loss is listed with "-")
3. Operating profit (loss is listed with "-") 839,043,907 980,513,662
Plus: Non-operating income 7.37 9,444,796 5,675,494
Minus: Non-operating expenses 7.38 205,516 1,139,419
Including: Losses on disposal of non-current assets 10,897 392,956
4. Total profits (total loss is listed with "-") 848,283,187 985,049,737
40
Full Text of 2014 Semiannual Financial Report of Yantai Changyu Pioneer Wine Co., Ltd.
Minus: Income taxes 7.39 210,241,876 244,475,516
5. Net profit (net loss is listed with "-") 638,041,311 740,574,221
Including: Realized net profit of the consolidated party before consolidation
Attributable to equity holders of the company 638,041,311 740,574,221
Minority interests
6. Earnings per share -- --
(1) Basic earnings per share 7.40 0.93 1.08
(2) Diluted earnings per share 7.40 0.93 1.08
7. Other Comprehensive Income 7.41 -269,603
8. Comprehensive Income 637,771,708 740,574,221
(1) Attributable to equity holders of the company 637,771,708 740,574,221
(2) Attributable to minority interests
The Legal Representative: Sun Liqiang Accounting Supervisor: Leng Bin Accounting Department Manager: Jiang Jianxun
Notes: Financial expenses concerning financial services shall be separately listed with exchange gains item.
2.4 Profit statement of the parent company
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd.
Unit: Yuan
Item Note Sum of current period Sum of prior period
1. Revenue 15.4 689,897,279 715,083,136
Minus: Operating costs 15.4 565,744,989 585,109,268
Taxes and surcharges 75,738,343 61,432,785
Selling expenses
Administrative expenses 49,958,367 59,247,136
Financial expenses -10,409,383 -13,193,582
Loss for impairment of assets
Plus: Fair value charge profit (loss is listed with "-")
Investment profit (loss is listed with "-") 15.5 65,474,283 11,140,442
Including: Investment profit for joint-run business and joint
venture
2. Operating profit (loss is listed with "-") 74,339,246 33,627,971
41
Full Text of 2014 Semiannual Financial Report of Yantai Changyu Pioneer Wine Co., Ltd.
Plus: Non-operating income 2,153,759 1,104,393
Minus: Non-operating expenses 86,189
Including: losses on disposal of non-current assets
3. Total profits (total loss is listed with "-") 76,493,005 34,646,175
Minus: Income tax 2,754,680 5,741,996
4. Net profit (net loss is listed with "-") 73,738,325 28,904,179
5. Earnings per share -- --
(1) Basic earnings per share 0.11 0.04
(2) Diluted earnings per share 0.11 0.04
6. Comprehensive Income
7. Total comprehensive Income 73,738,325 28,904,179
The Legal Representative: Sun Liqiang Accounting Supervisor: Leng Bin Accounting Department Manager: Jiang Jianxun
2.5 Consolidated statement of cash flow
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd.
Unit: Yuan
Item Sum of current period Sum of prior period
1. Cash flows from operating activities:
Cash received from sales of goods and rending of services 2,562,811,996 2,594,618,747
Net increase in customer and interbank deposits
Net increase in borrowings from central bank
Net increase in borrowings from other financial institutions
Cash received from receiving insurance premium of original
insurance contract
Net cash received from reinsurance business
Net increase in policy holder deposits and investment funds
Net increase in dealing with trading financial assets
Cash received from collecting interest, handling fees and
commission
Net increase in borrowings
Net increase in repurchasement business funds
42
Full Text of 2014 Semiannual Financial Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Sum of current period Sum of prior period
Tax refund received 17,998,725
Other cash received related to operating activities 8,348,936 45,571,455
Subtotal of cash flows of operating activities 2,571,160,932 2,658,188,927
Cash paid for goods and services 386,315,147 593,465,656
Net increase in customer loans and advances
Net increase in deposits in central bank and interbank deposits
Cash paid to original insurance contract payments
Cash paid to interest, handling fees and commission
Cash paid to policy bonus
Cash paid to and on behalf of employees 177,188,827 224,792,482
Cash paid for taxes and expenses 784,526,070 979,129,937
Other cash paid related to operating activities 451,642,363
333,455,757
Sub-total of cash outflows of operating activities 2,249,030,438
1,681,485,801
Net cash flow from operating activities 409,158,489
889,675,131
2. Cash flow from investing activities:
Cash received from return of investment
Fixed deposit with the term of over 3 months 218,392,728 457,524,719
Cash received from obtaining investment profit 6,572,323 7,651,150
Cash received from disposal of fixed assets, intangible assets and
100 4,000
other long-term assets
Net cash received from disposal of branch and other business unit
Other cash received related to investing activities
Subtotal of cash flows of investment activities 224,965,151 465,179,869
Cash paid to acquire fixed assets, intangible assets and other
398,392,132 417,217,901
long-term assets
Cash for investment
Cash paid to buy fixed deposit with the term of over 3 months 67,547,483 550,392,728
Net increase in hypothecated loan
Net cash paid to acquire branch and other business unit
Other cash paid related to investment activities
Subtotal of cash outflows of investment activities 465,939,615 967,610,629
43
Full Text of 2014 Semiannual Financial Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Sum of current period Sum of prior period
Net cash flow from investing activities -240,974,464 -502,430,760
3. Cash flow from financing activities
Cash received from acquiring investment
Including: cash received from acquiring minority shareholders
investment by branch
Cash received from acquiring loans
Cash received from issuing bonds
Other cash received related to financing activities
Subtotal cash flows of financing activities
Cash paid to pay debts
Cash paid to distribute dividend, profit or pay interest
Including: dividend and profit paid to minority shareholders by
branch
Other cash paid related to financing activities
Subtotal of cash outflows of financing activities
Net cash flow from financing activities
4. Influences of exchange rate fluctuation on cash and cash
-37,956
equivalents
5. Net Increase in cash and cash equivalents 648,662,711 -93,272,271
Plus: balance at the beginning of the period of cash and cash
956,558,932 1,562,294,026
equivalents
6. Balance at the end of the period of cash and cash equivalents 1,605,221,643 1,469,021,755
The Legal Representative: Sun Liqiang Accounting Supervisor: Leng Bin Accounting Department Manager: Jiang Jianxun
2.6 Statement of cash flow of the parent company
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd.
Unit: Yuan
Item Sum of current period Sum of prior period
1. Cash flows from operating activities:
Cash received from sales of goods and rending of services 457,521,916 653,588,149
Tax refund received 6,272,432
44
Full Text of 2014 Semiannual Financial Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Sum of current period Sum of prior period
Other cash received related to operating activities 169,506,621 393,008,207
Subtotal of cash flows of operating activities 627,028,537 1,052,868,788
Cash paid for goods and services 200,573,384 310,853,962
Cash paid to and on behalf of employees 57,999,162 61,492,292
Cash paid for taxes and expenses 150,308,754 174,337,248
Other cash paid related to operating activities 16,542,221 27,978,590
Sub-total of cash outflows of operating activities 425,423,521 574,662,092
Net cash flow from operating activities 201,605,016 478,206,696
2. Cash flow from investing activities:
Cash received from return of investment
Fixed deposit with the term of over 3 months 218,392,728 457,524,719
Cash received from obtaining investment profit 72,046,606 51,330,749
Net cash received from disposal of fixed assets, intangible
4,000
assets and other long-term assets
Net cash received from disposal of branch and other business
unit
Other cash received related to investing activities
Subtotal of cash flows of investment activities 290,439,334 508,859,468
Cash paid to acquire fixed assets, intangible assets and other
25,546,521 36,895,124
long-term assets
Cash for investment 3,700,000
Cash paid to buy fixed deposit with the term of over 3 months 44,547,483 538,392,728
Net cash paid to acquire branch and other business unit
Other cash paid related to investment activities
Subtotal of cash outflows of investment activities 70,094,004 578,987,852
45
Full Text of 2014 Semiannual Financial Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Sum of current period Sum of prior period
Net cash flow from investing activities 220,345,330 -70,128,384
3. Cash flow from financing activities
Cash received from acquiring investment
Cash received from acquiring loans
Cash received from issuing bonds
Other cash received related to financing activities
Subtotal cash flows of financing activities
Cash paid to pay debts
Cash paid to distribute dividend, profit or pay interest
Other cash paid related to financing activities
Subtotal of cash outflows of financing activities
Net cash flow from financing activities
4. Influences of exchange rate fluctuation on cash and cash
equivalents
5. Net Increase in cash and cash equivalents 421,950,346 408,078,312
Plus: balance at the beginning of the period of cash and cash
197,150,989 425,084,049
equivalents
6. Balance at the end of the period of cash and cash
619,101,335 833,162,361
equivalents
The Legal Representative: Sun Liqiang Accounting Supervisor: Leng Bin Accounting Department Manager: Jiang Jianxun
46
Full Text of 2014 Semiannual Financial Report of Yantai Changyu Pioneer Wine Co., Ltd.
2.7 Consolidated owner’s equity changing list
Unit: Yuan
Sum of current period
Shareholders equity of parent company
Item
Minus: Minority Total
Paid-in capital (or Capital Special Surplus General risk Undistributed
Treasury Others stockholders shareholders
capital stock) reserves reserves reserves preparation profits
stock equity equity
1. Balance at the end of last year 685,464,000 563,139,042 342,732,000 4,616,944,663 162,740,779 6,371,020,484
Plus: Accounting policies changing
Previous error correction
Others
2. Balance at the beginning of this
685,464,000 563,139,042 342,732,000 4,616,944,663 162,740,779 6,371,020,484
year
3. Increasing or reducing amount of
this year (reducing amount is listed 638,041,311 -269,603 637,771,708
with "-")
3.1 Net profits 638,041,311 638,041,311
3.2 Other Comprehensive Income -269,603 -269,603
Subtotal of above 3.1 and 3.2 638,041,311 -269,603 637,771,708
3.3 Owners' invested and reduced
capital
3.3.1 Owners' invested capital
3.3.2 Amount of shares paid and
reckoned in owners' equity
3.3.3 Others
3.4 Profit distribution
3.4.1 Drew surplus reserves
3.4.2 Drew general risk preparation
3.4.3 Distribution to owners (or
shareholders)
3.4.4 Others
3.5 Internal transfer of owners'
equity
47
Full Text of 2014 Semiannual Financial Report of Yantai Changyu Pioneer Wine Co., Ltd.
Sum of current period
Shareholders equity of parent company
Item Minus: Minority Total
Paid-in capital (or Capital Special Surplus General risk Undistributed
Treasury Others stockholders shareholders
capital stock) reserves reserves reserves preparation profits
stock equity equity
3.5.1 Capital reserves transferred
and increased capital (or capital
stock)
3.5.2 Surplus reserves transferred
and increased capital (or capital
stock)
3.5.3 Surplus reserves covering
deficit
3.5.4 Others
3.6 Special reserves
3.6.1 Withdrawal of this period
3.6.2 Usage of this period
3.7 Others
4. Banlance at the end of this period 685,464,000 563,139,042 342,732,000 5,254,985,974 -269,603 162,740,779 7,008,792,192
Unit: Yuan
Sum of current period
Shareholders equity of parent company
Item
Minus: Minority Total
Paid-in capital (or Capital Special Surplus General risk Undistributed
Treasury Others stockholders shareholders
capital stock) reserves reserves reserves preparation profits
stock equity equity
1. Balance at the end of last year 685,464,000 562,139,042 342,732,000 4,322,769,136 146,381,009 6,059,485,187
Plus: Accounting policies changing
Previous error correction
Others
2. Balance at the beginning of this
685,464,000 562,139,042 342,732,000 4,322,769,136 146,381,009 6,059,485,187
year
3. Increasing or reducing amount of
this year (reducing amount is listed 1,000,000 294,175,527 16,359,770 311,535,297
with "-")
48
Full Text of 2014 Semiannual Financial Report of Yantai Changyu Pioneer Wine Co., Ltd.
Sum of current period
Shareholders equity of parent company
Item Minus: Minority Total
Paid-in capital (or Capital Special Surplus General risk Undistributed
Treasury Others stockholders shareholders
capital stock) reserves reserves reserves preparation profits
stock equity equity
3.1 Net profits 1,048,185,927 1,048,185,927
3.2 Other Comprehensive Income
Subtotal of above 3.1 and 3.2 1,048,185,927 1,048,185,927
3.3 Owners' invested and reduced
1,000,000 16,359,770 17,359,770
capital
3.3.1 Owners' invested capital 16,359,770 16,359,770
3.3.2 Amount of shares paid and
reckoned in owners' equity
3.3.3 Others 1,000,000 1,000,000
3.4 Profit distribution -754,010,400 -754,010,400
3.4.1 Drew surplus reserves
3.4.2 Drew general risk preparation
3.4.3 Distribution to owners (or
-754,010,400 -754,010,400
shareholders)
3.4.4 Others
3.5 Internal transfer of owners' equity
3.5.1 Capital reserves transferred and
increased capital (or capital stock)
3.5.2 Surplus reserves transferred and
increased capital (or capital stock)
3.5.3 Surplus reserves covering
deficit
3.5.4 Others
3.6 Special reserves
3.6.1 Withdrawal of this period
3.6.2 Usage of this period
3.7 Others
4. Banlance at the end of this period 685,464,000 563,139,042 342,732,000 4,616,944,663 162,740,779 6,371,020,484
49
Full Text of 2014 Semiannual Financial Report of Yantai Changyu Pioneer Wine Co., Ltd.
2.8 Owner’s equity changing list of the parent company
Unit: Yuan
Sum of current period
Item Paid-in capital (or Minus: General risk Undistributed Total owners
Capital reserves Special reserves Surplus reserves
capital stock) Treasury stock preparation profits equity
1. Balance at the end of last year 685,464,000 557,222,454 342,732,000 3,811,446,092 5,396,864,546
Plus: Accounting policies changing
Previous error correction
Others
2. Balance at the beginning of this year 685,464,000 557,222,454 342,732,000 3,811,446,092 5,396,864,546
3. Increasing or reducing amount of this period
73,738,325 73,738,325
(reducing amount is listed with "-")
3.1 Net profits 73,738,325 73,738,325
3.2 Other Comprehensive Income
Subtotal of above 3.1 and 3.2 73,738,325 73,738,325
3.3 Owners' invested and reduced capital
3.3.1 Owners' invested capital
3.3.2 Amount of shares paid and reckoned in
owners' equity
3.3.3 Others
3.4 Profit distribution
3.4.1 Drew surplus reserves
3.4.2 Drew general risk preparation
3.4.3 Distribution to owners (or shareholders)
3.4.4 Others
3.5 Internal transfer of owners' equity
3.5.1 Capital reserves transferred and increased
capital (or capital stock)
3.5.2 Surplus reserves transferred and increased
capital (or capital stock)
3.5.3 Surplus reserves covering deficit
3.5.4 Others
50
Full Text of 2014 Semiannual Financial Report of Yantai Changyu Pioneer Wine Co., Ltd.
3.6 Special reserves
3.6.1 Withdrawal of this period
3.6.2 Usage of this period
3.7 Others
4. Banlance at the end of this period 685,464,000 557,222,454 342,732,000 3,885,184,417 5,470,602,871
Unit: Yuan
Sum of prior period
Item Paid-in capital (or capital Capital Minus: General risk Undistributed Total owners
Special reserves Surplus reserves
stock) reserves Treasury stock preparation profits equity
1. Balance at the end of last year 685,464,000 557,222,454 342,732,000 3,410,769,214 4,996,187,668
Plus: Accounting policies changing
Previous error correction
Others
2. Balance at the beginning of this year 685,464,000 557,222,454 342,732,000 3,410,769,214 4,996,187,668
3. Increasing or reducing amount of this
400,676,878 400,676,878
period (reducing amount is listed with "-")
3.1 Net profits 1,154,687,278 1,154,687,278
3.2 Other Comprehensive Income
Subtotal of above 3.1 and 3.2 1,154,687,278 1,154,687,278
3.3 Owners' invested and reduced capital
3.3.1 Owners' invested capital
3.3.2 Amount of shares paid and reckoned in
owners' equity
3.3.3 Others
3.4 Profit distribution -754,010,400 -754,010,400
3.4.1 Drew surplus reserves
3.4.2 Drew general risk preparation
3.4.3 Distribution to owners (or shareholders) -754,010,400 -754,010,400
3.4.4 Others
3.5 Internal transfer of owners' equity
3.5.1 Capital reserves transferred and
51
Full Text of 2014 Semiannual Financial Report of Yantai Changyu Pioneer Wine Co., Ltd.
increased capital (or capital stock)
3.5.2 Surplus reserves transferred and
increased capital (or capital stock)
3.5.3 Surplus reserves covering deficit
3.5.4 Others
3.6 Special reserves
3.6.1 Withdrawal of this period
3.6.2 Usage of this period
3.7 Others
4. Banlance at the end of this period 685,464,000 557,222,454 342,732,000 3,811,446,092 5,396,864,546
52
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
3. Basic information of this company
Yantai Changyu Pioneer Wine Co., Ltd. (the “Company”) was incorporated as a joint stock limited
company in accordance with the Company Law of the Peoples Republic of China (the “PRC”) in a
reorganization carried out by Yantai Changyu Group Co., Ltd. (“Changyu Group Company”), in which
Changyu Group Company injected certain assets and liabilities in relation to the brandy, wine, sparkling
wine, and tonic wine production and sales businesses to the Company. The Company and its
subsidiaries (the “Group”) are principally engaged in the production and sales of wine, brandy and
champagne.
Pursuant to the approval from the Government of Shandong Province (Luzheng [1997]119), the
Company was reorganized as a joint stock limited company on April 10, 1997. On September 23, 1997,
the Company was approved by China Securities Regulatory Commission (the “CSRC”) ([1997] No. 52)
to issue 88,000,000 domestically listed foreign investment shares (“B shares”) on Shenzhen Stock
Exchange. On September 18, 1997, the Company obtained the business license with the registered
number No. 26718011-9.
In October 2000, the Company was approved by CSRC Zheng Jian Zi [2000] No.148 to issue
32,000,000 domestically listed Common Shares (“A Shares”). The A shares were listed on Shenzhen
Stock Exchange on October 26, 2000.
Pursuant to the share reform notices issued by the Company in February 2006, Changyu Group
Company transferred its 13,977,600 shares to the shareholders of A share of the Company. After the
reform, percentage of equity attributable to Changyu Group Company decreased from 53.8% to 50.4%.
In June 2012, the Company gave additional 3 shares per 10 shares to all shareholders on the base
number of total equity of 527,280,000 on December 31, 2011, totally increased capital stock of
158,184,000 shares. By June 30, 2014, the Company issued capital stock totally of 685,464,000 shares
accumulatively.
The holding company of the Group is Changyu Group Company, which was ultimately controlled by
Yantai Guofeng Investment Holding Company Limited, ILLVA Saronno Holding SPA, International
Finance Corporation and Yaitai Yuhua Investment and Development Company Limited.
4. Main accounting policies, accounting estimates and previous error
4.1. Basis of preparation of financial statement
The Group implements Chinese Accounting Standards (“CAS”) published by Ministry of Finance on
February 15, 2006, guidelines and interpretations thereof and other regulations (generally called “Chinese
Accounting Standards”). In addition, the Group also discloses relevant financial information in accordance
with Information Disclosure and Preparation Rule for Enterprises Publically Issuing Securities No.15 ----
General Rules for Financial Statement (Revised in 2010).
53
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Note-accounting Basis and Pricing Principle
The note-accounting basis of financial accounting adopted by the Group is accrual system and the
measurement basis adopted by the Group in preparing its financial statement is historical cost.
Subsequently, if the assets are impaired, impairment provisions are made in accordance with the relevant
accounting standards.
4.2. Statement on compliance with CAS
The financial statements prepared by the Company fulfill the requirement of CAS and give a true and fair
view of the financial position and the consolidated financial position of the Company and of the Group as
at June 30, 2014, and of the operating results and the consolidated operating results and cash flows and the
consolidated cash flows for January-June 2014.
4.3. Accounting year
The accounting year of the Group is from January 1 to December 31.
4.4. Reporting currency
Since Renminbi (RMB) is the currency of the main economic environment in which the Company and the
domestic subsidiary companies thereof are situated, the Company and the subsidiary companies thereof
adopt RMB as the reporting currency. The overseas subsidiary companies thereof determine Euro as the
reporting currency according to the main economic environment in which they are situated. The Group
presentation currency is RMB.
4.5. Accounting treatment method for business combination under common control and
non-common control
4.5.1 Business combination under non-common control
A business combination involving entities or businesses under non-common control is a business
combination in which all of the combining entities or businesses are ultimately controlled by the different
party or same parties before and after the business combination.
The combination cost shall be the fair value of the assets paid, the liabilities incurred or assumed and the
equity instruments issued by the acquirer in exchange for the control on the acquiree. The agency fees for
audit, assessment and legal service, etc. incurred for the business combination and other relevant
management fees paid by the acquirer shall be recorded into the current profit and loss statement. For a
business combination under non-common control realized by two or more transactions of exchange, the
combination cost shall be the summation of the consideration paid on the acquisition date and the fair
value on the acquisition date of the stock rights of the acquiree held by the acquirer before the acquisition
date. The stock rights of the acquiree held by the acquirer before the acquisition date shall be re-measured
according to the fair value on the acquisition date, and the difference between the fair value and the book
value thereof shall be recorded into current investment income. Where the stock rights of the acquiree
held by the acquirer involves other comprehensive income, the relevant comprehensive income shall be
transferred into current investment income of the acquisition date.
The identifiable assets, liabilities and contingent liabilities which were obtained from the acquiree in the
business combination and met the recognition conditions shall be measured on the acquisition date
54
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
according to the fair value thereof. If the combination cost is larger than the fair value of the identifiable
net assets obtained from the acquiree, the difference shall be recognized as business goodwill and initially
measured according to the cost thereof. If the combination cost is less than the fair value of the
identifiable net assets obtained from the acquiree, the measurement of the combination cost and the fair
value of the identifiable assets and liabilities and contingent liabilities obtained from the acquiree shall be
rechecked firstly; after rechecking, if the combination cost is still less than the fair value of the
identifiable net assets obtained from the acquiree, the difference shall be recorded into current profit and
loss statement.
The goodwill formed due to business combination shall be separately listed in the consolidated financial
statement and measured on the basis of its costs minus the accumulative impairment provisions. The
goodwill shall have at least one impairment test at the end of each year.
The impairment test for the goodwill shall be combined with the relevant cash-generating units
or groups of cash-generating units. In other words, the carrying amount of the goodwill acquired
in the business combination shall be, from the acquisition date, reasonably allocated to each of
the Group's cash-generating units, or groups of cash-generating units that are expected to benefit
from the synergies of the combination. If the recoverable amount of cash-generating units or
groups of cash-generating units of the allocated goodwill is less than the book value thereof, the
corresponding impairment loss shall be recognized. The impairment losses shall be first deducted
from the book value of the corporate assets and goodwill which have been allocated to the
cash-generating unit or group of cash-generating units, and then deducted from the book value of
the remaining assets pro rata with goodwill excluded from consideration.
The recoverable amount is determined as the higher of the net amount of the fair value of assets minus the
disposal expenses thereof and the present value of the estimated future cash flows of the assets. The fair
value of the assets shall be determined according to the sales agreements price in the fair transaction; if
there is sales agreement but an assets active market, the fair value thereof shall be determined in
accordance with the acquirers offer; if there is no sales agreement or assets active market, the fair value
thereof shall be determined on the basis of the available optimum information. Therein, the disposal
expenses include legal fees, relevant taxes and dues and carriage expenses concerning the assets disposal
as well as the direct expenses incurred for making the assets to be under marketability state. The present
value of the estimated future cash flows of the assets shall be determined as the amount discounted at a
proper discount rate according to the estimated future cash flows incurred during the sustained use and at
the final disposal.
The impairment loss of the goodwill shall be recorded into the current profit and loss statement and shall
not be reserved in future accounting periods.
4.6. Compiling methods of consolidated financial statements
4.6.1Compiling methods of consolidated financial statements
The consolidation scope of consolidated financial statements is determined on the basis of control.
Control refers to the power that the Group can determine the financial and business policies of another
enterprise and can gain profits from the business activities of the enterprise.
As for the subsidiary companies disposed by the Group, the business results and the cash flows thereof
55
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
before the disposal date (date of losing control power) shall have been properly included in the
consolidated statement of income and the consolidated statement of cash flow.
As for the subsidiary company obtained in a business combination under non-common control, the
business results and the cash flows thereof since the acquisition date (date of obtaining control power)
shall have been properly included in the consolidated statement of income and the consolidated statement
of cash flow. The opening balance and the comparison value of the consolidated financial statements shall
not be adjusted.
The principal accounting policy and accounting period adopted by the subsidiary companies shall be
determined in accordance with the accounting policy and accounting period uniformly regulated by the
Company.
All major accounts and transactions between the Company and the subsidiary companies as well as
between subsidiary companies shall be neutralized at the time of combination.
The shares in the owner's equity of the subsidiary companies, which do not belong to the parent company,
shall be recognized as the minority equity and shall be listed under the item of “minority equity” of the
owners equity in the balance sheet. The shares in the current profit and loss statement of the subsidiary
companies, which belong to the minority equity, shall be listed under the item of “minority equity” of the
net profits in the consolidated statement of income.
If the loss of the subsidiary companies borne by minority shareholders exceeds the shares of the owner's
equity entitled therein by the minority shareholders at the beginning of the period, the difference shall be
still credited against the owner's equity.
4.7. Recognition standards of cash and cash equivalents
Cash comprises cash on hand and demand deposit of this Enterprise. Cash equivalents refers to short term
highly liquid investments which are readily convertible into known amounts of cash and which are
subject to an insignificant risk of changes in value.
4.8. Foreign currency transactions and foreign currency statement translating
4.8.1 Foreign currency transactions
At the time of initial recognition of a foreign currency transaction, the amount of the foreign currency
transaction shall be translated into the amount in the reporting currency at the spot exchange rate on the
transaction date.
The monetary items of the foreign currency transaction shall be translated into RMB at the spot change
rate on the balance sheet date. The currency translation difference generated due to the difference between
the spot change rate on the balance sheet date and the spot change rate at the initial recognition or on the
previous balance sheet date shall be recorded into the current profit and loss statement, except: (1) the
currency translation difference of the dedicated foreign currency loan that meets the capitalization
condition shall be recorded into the assets cost as capitalization during the capitalization period; (2) the
currency translation difference of the arbitrage tool for avoiding foreign exchange risk shall be treated
56
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
according to hedge accounting method; (3) the currency translation difference of the available-for-sale
monetary items generated by the book value other than the amortized cost shall be recognized as other
comprehensive income and shall be recorded into capital surplus and shall be recorded into the current
profit and loss statement.
The amount of the non-monetary items of the foreign currency transaction measured by historical cost
shall be still translated into the amount in the reporting currency at the spot exchange rate on the
transaction date. The non-monetary items of the foreign currency transaction measured by the fair value
shall be translated at the spot exchange rate on the fair value date, and the difference between the amount
in the reporting currency and the amount in original reporting currency shall be treated as the change of
the fair value (including exchange rate movement) and shall be recorded into current profit and loss
statement or recognized as other comprehensive income and recorded into capital surplus.
4.8.2 Translation of Foreign Currency Financial Statement
In order to compile consolidated financial statement, the foreign currency financial statement of overseas
business shall be translated into RMB financial statement in accordance with the following methods: all
asset and liability items in the balance sheets shall be translated at the spot exchange rate on the balance
sheet date; the owner's equity items, except the ones as "undistributed profits", shall be translated at the
spot exchange rate at the time when they occur; all items and the items reflecting the accrual profit
distribution in the profit statement shall be translated at the spot exchange rate at the time when they
occur; the undistributed profits at the beginning of the year shall be the translated undistributed profits at
the end of the previous year; the undistributed profits at the end of the year shall be calculated and listed
as the translated profit distribution items; the difference between the asset items, the liability items and
the summation of the owner's equity items shall be separately listed under the owner's equity items in the
balance sheet as the translation difference of the foreign currency financial statement.
The foreign currency cash flows and the cash flows of the overseas subsidiary companies shall be
translated at the spot exchange rate at the time when they occur; the amount of the cash and cash
equivalents impacted by the exchange rate movement shall be, as a reconciling item, separately listed
under “impact of exchange rate movement on cash and cash equivalents” in the cash flow statement.
The amount at the beginning of the year and the actual amount of the previous year shall be listed as the
amount translated according to the financial statement of the previous year.
4.9. Financial instruments
When becoming a party to a financial instrument, the Group shall recognize a financial asset or financial
liability. The financial assets and financial liabilities initially recognized shall be measured at their fair
values. For the financial assets and liabilities measured at their fair values and of which the variation is
recorded into the current profit and loss statement, the transaction expenses thereof shall be directly
recorded into the current profit and loss statement; for other categories of financial assets and financial
liabilities, relevant transaction expenses thereof shall be included into the initially recognized amount.
4.9.1 Classification of financial assets
Financial assets are classified into the following categories when they are initially recognized: the
57
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
financial assets which are measured at their fair values and the variation of which is recorded into the
current profit and loss statement, the investments which will be held to their maturity, loans and account
receivables and available-for-sale financial assets. The financial assets purchased and sold through
common modes shall be recognized and terminated from recognition according to the accounting on the
transaction date. The financial assets held by the Company are loans and account receivables.
The financial instruments issued by the Group shall be recognized as financial liabilities or right
instruments according to the essence of the financial instruments and the definition of the financial
liabilities and the right instruments.
Financial liabilities shall be classified into the following two categories when they are initially recognized:
the financial liabilities which are measured at their fair values and of which the variation is recorded into
the current profit and loss statement, and other financial liabilities. The financial liabilities assumed by the
Group are other financial liabilities.
4.9.2 Recognition reference and measurement methods of financial instruments
Loans and account receivables
Loans and account receivables refer to the non-derivative financial assets for which there is no quoted
price in the active market and of which the repo amount is fixed or determinable. The financial assets
classified by the Group as loans and account receivable include bill receivable, account receivable,
interest receivable and other receivables.
The loans and account receivables shall be subsequently measured at amortized cost by adopting effective
interest rate method. The profits or losses that arise when such loans and account receivables are
terminated from recognition, or are impaired or amortized, shall be recorded into the current profit and
loss statement.
Other financial liabilities
Other financial liabilities are subsequently measured at amortized cost by adopting effective interest rate
method, wherein the profits or losses that arise when such financial liabilities are terminated from
recognition or are amortized, shall be recorded into the current profit and loss statement.
4.9.3 Recognition reference and measurement methods for transfers of financial assets
Where a financial asset satisfies any of the following conditions, it shall be terminated from recognition:
(1) where the contractual rights for collecting the cash flow of the said financial asset are terminated; (2)
where the said financial asset has been transferred and all the risks and rewards of the financial asset have
been substantially transferred to the receiver; (3) where the financial asset has been transferred, although
the Group does not transfer or retain almost all the risks and rewards of the financial asset, the Group still
waives the control of the financial asset.
Where the overall transfer of the financial asset satisfies the derecognition conditions, the difference
between the book value of the transferred financial asset as well as the consideration received due to such
transfer and the summation of the cumulative amount of the fair value of the asset that is originally
recorded into other comprehensive income.
58
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
4.9.4 Conditions for terminated recognition of financial liabilities
When the prevailing obligations of a financial liability are relieved in all or in part, the recognition of the
financial liability shall be terminated in all or in part. Where the Group (debtor) 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, the recognition of the existing financial liability shall be
terminated, and at the same time the new financial liability shall be recognized.
Where the recognition of a financial liability is totally or partially terminated, the difference between the
book value 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) shall be included
into the current profit and loss statement.
4.9.5 Recognition methods of fair value of financial assets and financial liabilities
"Fair value" refers to the amount, at which both parties to a transaction who are familiar with the
condition exchange their assets or clear off their debts under fair conditions. The fair value of the
financial instruments that are actively traded in organized financial markets is determined by reference to
quoted market prices. For the financial instruments where there is no active market, the fair value thereof
is determined using valuation techniques. Such techniques include using recent arms length market
transactions; reference to the current market value of another instrument, which is substantially the same;
a discounted cash flow analysis; option pricing models and other valuation models.
4.9.6 Impairment test method and method for accruing impairment provision of financial
assets (excluding accounts receivable)
The Group assesses at each balance sheet date whether there is any objective evidence that a financial
asset or a group of financial assets is impaired. Objective evidences refer to those occurred after the initial
recognition, have effect on estimated future cash flows of the financial assets, and can be measured
reliably.
The objective evidences that can prove the impairment of a financial asset shall include:
A serious financial difficulty occurs to the issuer or the debtor;
The debtor breaches any of the contractual stipulations, such as, failure to pay or delay of the payment of
interests or the principal;
The Group makes any concession due to economic or legal factors, etc. to the debtor which is in financial
difficulties;
The debtor will probably become bankrupt or carry out other financial reorganizations;
The financial assets can no longer continue to be traded in the active market due to serious financial
difficulties of the issuer;
It is impossible to identify whether the cash flow of a certain asset within a certain combination of
financial assets has decreased or not. But after making an overall appraisal according to the public data
available, it is found that the predicted future cash flow of the said combination of financial assets has
indeed decreased since it was initially recognized and such decrease can be measured, including:
59
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
The payment ability of the debtor of the said combination of financial assets worsens gradually;
The country or economic region where the debtor is situated has the conditions that may cause the
financial assets to be unpaid.
Other objective evidences showing the impairment of the financial assets.
Financial assets carried at amortized cost
Where a financial asset measured at amortized cost is impaired, the book value of the said financial asset
shall be written down to the current value of the predicted future cash flow determined according to the
capitalization of original effective exchange rate (excluding the loss of future credits not yet occurred),
and the amount as written down shall be recognized as loss of the impairment of the asset and shall be
recorded into the current profit and loss statement. 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 losses originally recognized shall be reversed. However, the
reversed book value shall not be any more than the amortized costs of the said financial asset on the day
of reverse under the assumption that no provision is made for the impairment.
An impairment test shall be made by the Group independently on the individually significant financial
assets; with regard to not individually significant financial assets, an independent impairment test may be
carried out, or they may be included in a combination of financial assets with similar credit risk
characteristics so as to carry out an impairment-related test. Where, upon independent test, the financial
asset (including the individually significant financial assets and not individually significant financial
assets) has not been impaired, it shall be included in a combination of financial assets with similar credit
risk characteristics so as to conduct another impairment test. Assets that are individually assessed for
impairment and for which an impairment loss is or continues to be recognized shall not be included in the
combination of the financial assets with similar credit risk characteristics for impairment test.
4.10. Recognition standards and accrual methods for bad account provision of accounts
receivable
4.10.1 Bad account provision of individually significant accounts receivable
The account receivable with the amount above RMB
Judgment reference or amount standard for individually
3,000,000 shall be recognized by the Group as the
significant accounts
individually significant account receivable.
An impairment test shall be made independently by
the Group on the individually significant financial
assets. Where, upon independent test, the financial
asset has not been impaired, it shall be included in a
combination of financial assets with similar risk
Accruing method for individually significant accounts
characteristics so as to conduct another impairment
accrued for bad account provision individually
test. The account receivables that are independently
assessed for impairment and for which an impairment
loss is or continues to be recognized shall not be
included in the combination of account receivables
with similar credit risk characteristics for impairment
60
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
test.
4.10.2 Individually insignificant accounts receivable accrued for bad account provision
individually
If there is objective evidence that this Group cant call back the accounts
Reasons for accruing for bad account
according to original articles, the individually insignificant accounts
provision individually
receivable can be accrued for bad account provision individually.
The impairment losses are recognized according to the difference between
Methods for accruing bad account
the present value of future cash flow and the book value, and impairment
provision
provision is accrued.
4.11. Inventories
4.11.1 Classification of inventories
Inventories of the Group comprise raw materials, goods in process, commodity stocks. The inventories
are initially measured in cost. The cost of inventory consists of purchase costs, processing costs and other
expenditures to make inventories reach current site and state.
4.11.2 Pricing method for sending out inventories
Weighted average method is used to determine the actual cost for sending out inventories when sending
them out.
The agricultural products after the harvest are handled in accordance with the CAS 1- Inventories.
4.11.3 Recognition reference of the net realizable value of inventories and the method for
accruing inventory depreciation provision
Inventories are stated at the lower of cost and net realizable value at the balance sheet date. If the net
realizable value is lower than the cost of inventories, the provision for the loss on decline in value of
inventories are made. The net realizable value refers to the amount: the estimated sale price of inventories
deducting the estimated cost to happen till completion, the estimated selling expense and relevant taxes,
in daily activities. Based on the acquired concrete evidence, the purpose for holding inventories and the
impact of matters after balance sheet date shall be also considered during recognition of the net realizable
value of inventories.
The inventories are accrued inventories depreciation provision according to the difference of single
inventory item and its net realizable value.
After accruing inventories depreciation provision, if the previous influence factors writing down
inventories value disappear resulting in the net realizable value of the inventories being higher than their
book value, it shall be reversed from the originally accrued inventories depreciation provision amount and
the reversed amount shall be included in the current profit and loss statement.
4.11.4 Inventory system for the inventories
Inventory system: Perpetual inventory system
61
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
4.11.5 Amortization method of low-priced and easily-worn articles and packages
Amortization method of packages and low-priced and easily-worn articles: One-off amortization method
4.12 Long-term equity investments
4.12.1 Recognition of initial investment cost
For long-term equity investments acquired from business combination under non-common control, the
combination cost is regarded as the investment cost of long-term equity investments. Where the business
combination under non-common control is realized by steps through multiple transactions, the sum of the
book value of the acquirees equity investment held before the acquisition date and the newly increased
investment cost on the acquisition date shall be regarded as the investment cost of long-term equity
investments. For equity investments other than long-term equity investments formed by business
combination, initial measurement shall be carried out according to the costs.
4.12.2 Subsequent measurement and recognition of loss and profit
Long-term equity investments by which Group has no controls, has no joint control or significant
influence to invested entities, has no quoted market price in an active market and the fair value cannot be
reliably measured are measured on cost method basis; in addition, long-term equity investments to the
subsidiary companies are measured on cost method basis by corporate financial statements. Subsidiary
companies refer to the invested entities by which the company has control. When cost method is adopted,
the long-term equity investments are measured at the initial investment cost, except that the initial
investment cost contains declared but unissued cash dividends or profits. The current investment income
is recognized according to the dividends or profits declared to distribute by the invested entities. During
disposal of long-term equity investments, the difference between the book value and the actual price shall
be included in the current profit and loss statement.
4.12.3 Reference for recognizing common control and significant influence on invested unit
Control refers to the right of deciding the financial and operating policies of an enterprise, and getting
interests from the operating activities of such enterprise. Joint control refers to the mutual control to a
certain economic activity according to contract agreement and exists only when the investing parties who
need to share the control power agree unanimously for making important financial and operating
decisions related to such economic activity. Significant influence refers to the right to take part in
decision making of financial and operating policies of an enterprise, but cant control the formulation of
such policies independently or with other parties. The current convertible corporate bonds, current
executable warrants and other potential voting factors of the invested unit held by the investing
enterprises and other parties shall be considered, during recognizing whether to implement control or
exert significant influence on the invested units.
4.12.4 Impairment test method and method for accruing impairment provision
On each balance sheet date, the Group made assessment on whether or not there is any indication of
potential impairment of long-term equity investment. If there is any evidence that indicates the possibility
of asset impairment, the recoverable amount of the asset is estimated. If the recoverable amount of the
asset is lower than the book value, asset impairment provision shall be accrued according to the difference
and charged to the current profit and loss statement in the period. After the impairment loss of long-term
62
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
equity investment has been recognized, it wont be reversed in future accounting periods.
4.13 Fixed assets
4.13.1 Recognition conditions of fixed assets
Fixed assets refer to the tangible assets held for producing goods, rendering services, leasing or operation
management, with useful life exceeding one accounting year. Fixed assets can only be confirmed that the
economic benefits relating to the fixed assets are likely to flow into the Group, and the cost of the fixed
assets can be measured reliably. Initial measurement for fixed assets shall be carried out according to the
cost. For the subsequent expenses related to the fixed asset, if the economic benefits relating to the fixed
asset are likely to flow into the Group and the cost thereby can be reliably measured, the subsequent
expenses are included in fixed asset cost and the book value of the substituted part shall be terminated.
Other subsequent expenses shall be included in the current profit and loss statement.
4.13.2 Depreciation methods of kinds of fixed assets
Depreciation is calculated on the fixed year average method basis within the useful life from the month
following having been put into operation. The estimated useful life, residual value and annual
depreciation rate are as follows:
Classification Estimated useful life Estimated residual value Annual depreciation rate
Buildings 20-40 years 0-5% 2.4%-5.0%
Machinery 10-20 years 0-5% 4.8%-10.0%
Motor vehicles 4-12 years 0-5% 7.9%-25.0%
4.13.3 Impairment test method and method for accruing impairment provision of fixed assets
On each balance sheet date, the Group made assessment on whether or not there is any indication of
potential impairment of fixed assets. If there is any evidence that indicates the possibility of asset
impairment, the recoverable amount of the asset is estimated. The estimated recoverable amount of an
asset is based on an individual asset. If it is difficult to determine the recoverable amount individually, the
recoverable amount is determined for the cash-generating unit to which the asset belongs. If the
recoverable amount of the asset or cash-generating unit is less than its book value, the impairment
provision of asset shall be accrued according to the difference and included in the current profit and loss
statement.
After a loss of asset impairment has been recognized, it is not be reversed in future accounting periods.
4.13.4 Others
The Group reviewed the useful life, expected net residual value, and the depreciation method of the fixed
assets at least at the end of each year, and in case of any change, the change will be disposed as
accounting estimate change.
When the fixed assets are under disposal state or cannot generate any economic benefits through use or
disposal as expected, the fixed assets are derecognized. The selling, transfer, scrapping or damage
disposal income shall be included in the current profit and loss statement after deducing the book value
and relevant taxes.
63
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
4.14. Construction in progress
4.14.1 Classification of construction in progress
Construction in progress are measured on actual costs, including the direct costs of construction,
capitalised borrowing costs during the period of construction and other expenditures. The construction in
progress is not depreciated.
4.14.2 Reclassification standard and time of construction in progress to fixed assets
Construction in progress is reclassified to the fixed assets when completed and ready for use.
4.14.3 Impairment test method and method for accruing impairment provision of
construction in progress
On each balance sheet date, the Group made assessment on whether or not there is any indication of
potential impairment of construction in progress. If there is any evidence that indicates the possibility of
asset impairment, the recoverable amount of the asset is estimated. The estimated recoverable amount of
an asset is based on an individual asset. If it is difficult to determine the recoverable amount individually,
the recoverable amount is determined for the cash-generating unit to which the asset belongs. If the
recoverable amount of the asset or cash-generating unit is less than its book value, the impairment
provision of asset shall be accrued according to the difference and included in the current profit and loss
statement.
After a loss of asset impairment of construction in progress has been recognized, it is not be reversed in
future accounting periods.
4.15. Borrowing costs
4.15.1 Recognition principles of borrowing costs capitalization
Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying
asset shall be capitalized after expenditure to acquire happens, borrowing costs happen, acquisition,
construction or production essential for making the assets ready for their intended use or sales. Other
borrowing costs are recognized as expenses when happening.
4.15.2 Capitalization period of borrowing costs
Capitalization of borrowing costs shall cease when all the activities necessary to prepare the qualifying
asset for its intended use of sale are substantially complete.
4.15.3 Interruption period of capitalization
If the acquisition, construction or production of a qualifying asset is abnormally interrupted, and the
interruption period exceeds three months, the capitalization of borrowing costs shall be temporarily
ceased, until the construction or production resumes.
4.16. Biological assets
Productive biological assets refer to the biological assets held for the purposes of producing agricultural
products, rendering services or leasing, etc. The productive biological assets of the Group are vines that
produce grapes. Initial measurement for the productive biological assets is carried out according to the
64
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
cost. For the occurred cost of the self-breeding productive biological asset before achieving the intended
production and operation purposes can be directly attributable to the necessary expenses of the asset,
including the borrowing cost conforming to capitalization.
After reaching the intended production and operation purposes, the productive biological assets are
accrued depreciation within useful life based on the fixed year average method. The expected useful life,
net residual value and annual depreciation rate of different productive biological assets are as follows:
Category Estimated useful life Estimated residual value (%)
Annual depreciation rate
Vines 20 years
5%
The Group reviewed the useful life, expected net residual value, and the depreciation method of the
productive biological assets at the end of each year. In case of any change, the change will be disposed as
accounting estimate change.
At the time of sale, loss, death, damage or destroy of a productive biological asset, the difference after
deducting the book value and the relevant taxes from the disposal income are recognized in the current
profit and loss statement.
On each balance sheet date, the Group made assessment on whether or not there is any indication of
potential impairment of productive biological assets. If there is any evidence that indicates the possibility
of asset impairment, the recoverable amount of the asset is estimated. The estimated recoverable amount
of an asset is based on an individual asset. If it is difficult to determine the recoverable amount
individually, the recoverable amount is determined for the cash-generating unit to which the asset belongs.
If the recoverable amount of the asset or cash-generating unit is less than its book value, the impairment
provision of asset shall be accrued according to the difference and included in the current profit and loss
statement.
After a loss of asset impairment of a productive biological asset has been recognized, it is not be reversed
in future accounting periods.
4.17. Intangible assets
4.17.1 Pricing method of intangible assets
Intangible assets include land use right and software, etc.
Initial measurement for intangible assets is carried out according to the cost. For the intangible assets with
finite lives, since they are available, the amount after the original value deducts expected net residual
value and the accrued accumulative amount of provision for impairment is amortized evenly based on
straight line method. The intangible assets with indefinite lives are not amortized.
65
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
4.17.2 Estimation of useful life of intangible assets with finite lives
At the end of the period, the useful life and amortization method of the intangible assets with finite lives
shall be reviewed and adjusted if necessary.
Useful lives of different intangible assets are as follows:
Item Predicted useful life Reference
Land use right 40-50 years Useful life of land
Software use right 5-10 years Predicted period of bringing economic benefits
4.17.3 Judgment reference of intangible assets with indefinite lives
If the periods during which it can bring economic benefits to the Group cannot be reliably determined, the
intangible assets are classified as intangible assets with indefinite useful life. However, the Group doesnt
have this kind of intangible assets.
4.17.4 Accruing of impairment provision of intangible assets
On each balance sheet date, the Group made assessment on whether or not there is any indication of
potential impairment of intangible assets with finite lives. If there is any evidence that indicates the
possibility of asset impairment, the recoverable amount of the asset is estimated. The estimated
recoverable amount of an asset is based on an individual asset. If it is difficult to determine the
recoverable amount individually, the recoverable amount is determined for the cash-generating unit to
which the asset belongs. If the recoverable amount of the asset or cash-generating unit is less than its
book value, the impairment provision of asset shall be accrued according to the difference and included in
the current profit and loss statement.
Depreciation test for intangible assets with indefinite lives and not reaching the available state shall be
carried out every year, regardless of whether there is any indication of depreciation.
After a loss of intangible asset impairment has been recognized, it is not be reversed in future accounting
periods.
4.18 .Amortization methods of long-term prepaid expenses
Long-term prepaid expenses refer to prepaid expenses occurred that should be borne by current and
subsequent periods and should be amortized over more than one year. Long-term prepaid expenses are
amortized evenly over the expected beneficial periods.
Amortization period of different long-term prepaid expenses of the Group are as follows:
Amortization period
Land requisition fee 50 years
Land leasing fee 50 years
66
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Greening fee 5 years
Others 5-50 years
4.19. Revenue
4.19.1 Specific judgment standards of the acknowledging time of revenues from sale of goods
When the significant risks and rewards of ownership of goods have been transferred to the buyer,
provided that the Group maintains neither continuous management right involvement to the degree
usually associated with ownership, nor effective control over the goods sold, and cost of sales can be
measured reliably. When the relevant economic benefits are likely to flow into the enterprise and the
relevant incurred cost or cost to be incurred can be measured reliably, the realization of the revenue from
sale of goods can be recognized.
4.19.2 Reference for confirming rendering of services
When income amount of rendering of services can be measured reliably, the relevant economic benefits
are likely to flow into the enterprise, the stage of completion of the transaction can be measured reliably,
and the incurred cost or cost to be incurred in the transaction can be measured reliably, then the income
realization of rendering of services can be recognized. The Group confirmed the income of the rendered
services according to percentage-of-completion method on the balance sheet date. The
percentage-of-completion of the service transaction is determined according to the proportion of the
rendered service accounting for the total services that shall be rendered.
If the outcome of rendering of service transaction cannot be reliably estimated, the income of the rendered
services are determined according to the render cost amount that is incurred and is expected to be
compensated, and the incurred service cost shall be the period charge. If the incurred service cost is
expected to be unable to be compensated, the income will not be determined.
4.20. Government grants
4.20.1 Type
Government grants refer to monetary or non-monetary assets received by the Group from the government.
Government grants are recognized where there is reasonable assurance that the grant will be received and
all attaching conditions will be complied with. Monetary grants are measured on the basis of the amount
received or the amount receivable. According to the nature of the granted object clearly stipulated in
relevant government documents, government grants include grants related to assets and grants related to
income.
4.20.2 Accounting policies
Government grants related to assets are recognized as deferred income and are distributed equally in the
current profit and loss statement for the current period within the useful lives of the relevant assets.
The government grants relevant to revenue to be used as compensation for future expenses or losses are
recognized as deferred income and are recorded in the profit and loss statement for the period where the
relevant expenses are recognized; or those to be used as compensation for relevant expenses or losses
already occurred are recorded directly in the profit and loss statement for the current period.
67
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
4.21 Deferred income tax assets and deferred income tax liabilities
The balance sheet liability method is used for recognizing deferred income tax assets and deferred income
tax liabilities for the difference between certain assets, book value of liability items and their tax base, and
the temporary differences arising from the book value of items (that are not recognized as assets and
liabilities but can be recognized the tax bases as stipulated by tax law) and tax bases.
Normally all temporary differences are recognized the relevant deferred income taxes. However, for the
deductible temporary differences, the Group recognized the relevant deferred income tax assets taking the
taxable income that is likely to be obtained for deducting deductible temporary differences as the limit. In
addition, the temporary differences relevant to initial recognition of goodwill and relevant to the initial
recognition of assets or liabilities arising from transaction not of business combination, and not
influencing accounting profit and taxable income (or deductible loss) are not recognized for the relevant
deferred income tax assets or liabilities.
For the deductible losses and tax credits that can be transferred during subsequent years, the
corresponding deferred income tax assets shall be recognized by taking the future taxable income that is
likely to be used to deduct deductible losses and tax credits as the limit.
The Group recognized the deferred income tax liabilities arising from the taxable temporary differences
relevant to the subsidiary companies, except for that the Group can control the time of the reverse of the
temporary differences which are unlikely to be reversed in the foreseeable future. For the deductible
temporary differences relevant to the subsidiary companies, the Group will recognize the deferred income
tax assets only when the temporary differences are likely to be reversed in the foreseeable future and the
taxable income for deducting deductible temporary differences is likely to be achieved in the future.
On the balance sheet date, the deferred income tax assets and deferred income tax liabilities are measured
according to the applicable tax rate during the period of expecting to repossess the relevant assets or pay
off relevant liabilities as stipulated by tax law.
Except for the current income taxes and deferred income taxes (relevant to transaction and matter that are
directly included in other comprehensive income or stockholder's equity) that are included in other
comprehensive income or stockholder's equity and the deferred income taxes arising from business
combination that adjusts the book value of the goodwill, the expenses or revenues of other current income
taxes and deferred income taxes are included in the current profit and loss statement.
On the balance sheet date, the Group shall review the book value of deferred income tax assets and shall
write down the book value of deferred income tax assets if sufficient taxable income is unlikely to be
obtained in the future to deduct the benefits of deferred income tax assets. The amount written down shall
be reversed when it is likely to obtain sufficient taxable income.
When there is the legal right of netting or intention of netting or carrying out obtaining assets and paying
off liabilities at the same time, the current income tax asset and current income tax liability of the Group
are reported according to the net amount after deduction.
When there is the legal right of netting the current income tax asset and current income tax liability and
the deferred income tax assets and deferred income tax liabilities are relevant to the income tax collected
by same tax collection and management department on the same taxpayer or different taxpayers, however,
the involved tax payers intend to net the current income tax assets and liabilities or obtain assets and pay
68
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
off liabilities at the same time during every period of reverse of each significant deferred income tax
assets and liabilities in the future, deferred income tax assets and deferred income tax liabilities of the
Group are reported according to the net amount after deduction.
4.22 Operating leases and financial leases
4.22.1 Accounting treatment of operating leases
Leases that transfer substantially all the rewards and risks of ownership of assets to the Group, are
accounted for as finance leases, otherwise are accounted for as operating leases.
Rental expenses under the operating leases are credited to related costs of the assets or the current profit
and loss statement on the straight line basis over the lease terms. The initial direct costs are credited to the
current profit and loss statement. Contingent rentals are recorded in the current profit and loss statement
upon actual accrual.
4.23. Changes in main accounting policies and accounting estimates
4.23.1 Changes in accounting policies
Nil
4.23.2 Changes in accounting estimates
Nil
4.24 Correction of previous accounting errors
Nil
4.25 Other main accounting policies, accounting estimates and compiling method of financial
statement
During the application of the accounting policies of this Financial Report IV, the Group needs to judge,
estimate and assume the book value of the report items that are unable to be accurately measured due to
the inherent uncertainties of business activities, in which the judgment, estimation and assumption are
made based on the previous historical experience of the management level of the Group and considering
other relevant factors. The actual results may have differences from the estimation of the Group.
The Group regularly reviews the above-mentioned judgment, estimation and assumption based on the
continuous operation, and the change of accounting estimate only affects the current period of change, of
which the influence number will be recognized at the current period of change; in case of influencing both
current period and future period of change, the influence number will be recognized at the current period
and future period of change.
Critical assumptions and uncertain factors adopted in accounting estimates
On the balance sheet date, the main critical assumptions and uncertainties in accounting estimates that are
likely to result in significant adjustments in assets and book value of liabilities in future period include:
Deferred income tax assets
Within the limit of the likeliness that there is sufficient taxable income to deduct deductible losses, the
69
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
deferred income tax assets shall be recognized according to all deductible losses that have not been
utilized, which requires the management level to use a lot of judgments to estimate the occurred time and
amount of taxable income to be obtained in the future, and combine with tax planning strategy to decide
the amount of deferred income tax assets that shall be recognized.
Depreciation
The Group uses straight line method for provision for depreciation within the expected useful life after
considering the residual value of the fixed assets. The Group regularly reviewed the expected useful life
to decide the amount of depreciation expense that will be included in every report period. The expected
useful life is recognized by the Group according to the previous experience on similar assets and in
combination with the expected technical changes. The depreciation expense shall be adjusted if there are
significant changes in the previous estimate.
Useful life of intangible assets
The expected useful life of intangible assets are estimated based on actual useful life of the previous
intangible assets of similar natures and functions and according to historical experience and in
consideration of the duration of the contractual rights or other legal rights applicable to the intangible
assets.
In case that the useful life of the intangible assets shortens or extends, the amortization period will be
adjusted in the future period for intangible assets with finite life; for intangible assets with indefinite life,
if there is evidence showing that their useful life is finite, their useful life will be estimated in the future
period and they will be disposed according to the disposal principles of intangible assets with finite life.
Depreciation of biological assets
Productive biological assets are examined at each balance sheet date by the Group. If any reliable
evidence shows that the net realizable value of any consumptive biological assets or the recoverable
amount of any productive biological asset is lower than its book value due to natural disasters, plant
diseases and insect pests, animal disease or change of market demand, provision for price decrease and
impairment should be made on the basis of the difference between the net realizable value or the
recoverable amount and the book value and be recorded in the current profit and loss statement.
Long-term assets impairment
The Group carries out impairment assessment on long-term assets to determine if the recoverable amount
of assets drops to the amount lower than their book value. If the situation shows that the book value of the
long-term assets may not be fully recovered, the relevant assets will be deemed as having been impaired
and the impairment loss shall be correspondingly recognized.
The recoverable amount is the higher in: the net amount of fair value of an asset (or cash-generating unit)
minus disposal expense, and the present value of the estimated future cash flow of the asset (or
cash-generating unit). It is difficult for the Group to accurately estimate the fair value of an asset because
of difficulty in obtaining the open market price of the asset (or cash-generating unit). It needs to make
significant judgments on the output, selling price, relevant operating cost of the asset (or cash-generating
unit) and the discount rate used for calculating present value when estimating the present value of future
cash flow. The Group will use all easily available materials in estimating the recoverable amount,
70
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
including the forecast relevant to output, selling price and relevant operating cost according to the
reasonable and supportable assumption.
Bad account provision of accounts receivable
Bad account provision of accounts receivable shall be recognized by the management level according to
the objective evidences (e.g. the possibility of bankruptcy or severe financial difficulty of the debtor) that
can affect the recovery of the accounts receivable. The management level will reevaluate bad account
provision in the end of every year.
Inventory depreciation provision accrued based on net realizable value
According to the inventory accounting policy, the Group carries out price decrease provision for obsolete
and unsalable inventories with higher cost than the net realizable value measurement according to the
lower of the cost and net realizable value. The Group will reevaluate if the inventories are obsolete and
unsalable, and if the net realizable value is lower than inventory cost in the end of every year.
5. Taxes
5.1 Main taxes and tax rate of the Company
Taxes Tax basis Tax rate
VAT is levied at 17% on the invoiced amount after deduction of eligible
Value added tax 17%
input VAT.
Consumption tax The consumption tax is levied at 10%-20% on taxable revenue. 10%-20%
Business tax The business tax is levied at 5% on taxable revenue. 5%
Urban maintenance and
Levied at 7% of total business tax payment. 7%
construction tax
Corporate income tax The corporate income tax is levied at 25% on taxable income. 25%
5.2 Tax incentives and relative permit
Ningxia Changyu Grape Growing Co., Ltd., a subsidiary of the Company, whose principal activity is grape
growing, is incorporated in Yongning County, Ningxia Hui Autonomous Region. According to clause 27 of
PRC Corporate Income Tax and clause 86 of PRC Corporate Income Tax Measures for Implementation, the
company enjoys an exemption of corporate income tax.
Xinjiang Tianzhu Wine Co., Ltd., a subsidiary of the Company, is an enterprise engaged in the production and
sales of bulk wine incorporated in Shihezi City, Xinjiang Uygur Autonomous Region. In accordance with
relevant regulations of Notice concerning Issuing Circular on Preferential Corporate Income Tax Policies for
Newly Established Enterprises in Underprivileged Areas of Xinjiang (Provisional) (Cai Shui [2011] No. 60),
and Notice of Financial & Tax Policies to Improve the Development of Agricultural Product Manufacturing
Industry (Xin Zheng Fa [2010] No. 105), the company enjoys preferential corporate income tax policies.
From 2012 to 2015, from the year, the company got the first operating revenue, the company shall be
71
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
exempted from local corporate income tax based on the preferential policy of corporate income tax rate at
15%. The applicable tax rate in this year is 9%.
Xinjiang Changyu Baron Balboa Chateau Co., Ltd., a subsidiary of the Company, is an enterprise engaged in
the production and sales of bulk wine incorporated in Shihezi City, Xinjiang Uygur Autonomous Region. In
accordance with relevant regulations of Notice concerning Issuing Circular on Preferential Corporate Income
Tax Policies for Newly Established Enterprises in Underprivileged Areas of Xinjiang (Provisional) (Cai Shui
[2011] No. 60), and Notice of Financial & Tax Policies to Improve the Development of Agricultural Product
Manufacturing Industry (Xin Zheng Fa [2010] No. 105), the company enjoys preferential corporate income
tax policies. From 2011 to 2015, from the year, the company got the first operating revenue, the company
shall be exempted from local corporate income tax based on the preferential policy of corporate income tax
rate at 15%. The applicable tax rate in this year is 9%.
72
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
6. Business combination & consolidated financial statements
6.1 Particulars of the subsidiaries
6.1.1 Subsidiaries acquired by establishment or investment
Unit: Yuan
Balance after the owners
Amount for
equity in the parent company
Other balance counteracting
Actual Whether to counteracts the losses of
included into Proportion Proportion Interests of minority
Type of the Registered investment at consolidate minority shareholders in this
Name of the subsidiary Registered place Business nature Business scope the net in shares of voting minority shareholders
subsidiary capital the end of financial term higher than their
investment to (%) power (%) shareholders profits/losses in the
term statements owners equity in the
the subsidiary interests of minority
subsidiaries at the beginning
shareholders
of year
Beijing Changyu Sales RMB
Wholly-owned
and Distribution Co., Beijing City, China Sales 1,000,000 Sales of wine 1,000,000 100% 100% Yes
subsidiary
Ltd. (“Beijing Sales”) Yuan
Yantai Kylin Packaging Yantai City, RMB
Wholly-owned Production of packaging
Co., Ltd. (“Kylin Shandong Province, Manufacturing 15,410,000 23,176,063 100% 100% Yes
subsidiary materials
Packaging”) China Yuan
Yantai Changyu-Castel
Yantai City,
Wine Chateau Co., Ltd. Holding USD
Shandong Province, Manufacturing Production and sales of wine 28,968,100 70% 100% Yes 12,365,016
(“Changyu Chateau”) subsidiary 5,000,000
China
(b)
Changyu (Jingyang) Xianyang City, RMB
Wholly-owned
Pioneer Wine Co., Shaanxi Province, Manufacturing 1,000,000 Production and sales of wine 1,000,000 100% 100% Yes
subsidiary
Ltd. (“Jingyang Wine”) China Yuan
73
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Balance after the owners
Amount for
equity in the parent company
Other balance counteracting
Actual Whether to counteracts the losses of
included into Proportion Proportion Interests of minority
Type of the Registered investment at consolidate minority shareholders in this
Name of the subsidiary Registered place Business nature Business scope the net in shares of voting minority shareholders
subsidiary capital the end of financial term higher than their
investment to (%) power (%) shareholders profits/losses in the
term statements owners equity in the
the subsidiary interests of minority
subsidiaries at the beginning
shareholders
of year
Yantai Changyu Yantai City, RMB
Wholly-owned
Pioneer Wine Sales Co., Shandong Province, Sales 8,000,000 Sales of wine 8,000,000 100% 100% Yes
subsidiary
Ltd. (“Sales Company”) China Yuan
Langfang Development
Zone Castel-Changyu Holding Langfang City, Hebei USD
Manufacturing Production and sales of wine 19,835,730 49% 100% Yes 22,702,522
Wine Co., Ltd. subsidiary Province, China 6,108,818
(“Langfang Castel”) (c)
Changyu (Jingyang)
Xianyang City, RMB
Pioneer Wine Sales Wholly-owned
Shaanxi Province, Sales 1,000,000 Sales of wine 1,000,000 100% 100% Yes
Co., Ltd. (“Jingyang subsidiary
China Yuan
Sales”)
Langfang Changyu RMB
Wholly-owned Langfang City, Hebei
Pioneer Wine Sales Co., Sales 1,000,000 Sales of wine 1,000,000 100% 100% Yes
subsidiary Province, China
Ltd. (“Langfang Sales”) Yuan
Shanghai Changyu
RMB
Sales and Distribution Wholly-owned
Shanghai City, China Sales 1,000,000 Sales of wine 1,000,000 100% 100% Yes
Co., Ltd. (“Shanghai subsidiary
Yuan
Sales”)
Beijing Changyu AFIP Wholly-owned Miyun County, Sales RMB Planting of fruit, flowers and 1,000,000 100% 100% Yes
74
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Balance after the owners
Amount for
equity in the parent company
Other balance counteracting
Actual Whether to counteracts the losses of
included into Proportion Proportion Interests of minority
Type of the Registered investment at consolidate minority shareholders in this
Name of the subsidiary Registered place Business nature Business scope the net in shares of voting minority shareholders
subsidiary capital the end of financial term higher than their
investment to (%) power (%) shareholders profits/losses in the
term statements owners equity in the
the subsidiary interests of minority
subsidiaries at the beginning
shareholders
of year
Eco-agriculture subsidiary Beijing City, China 1,000,000 oil crops; poultry raising;
Development Co., Ltd. Yuan sales of fresh fruit, rough
(“Agricultural dried fruit and nut; tourism
Development”) resource development; and
technology consultation
Beijing Changyu AFIP RMB
Holding
Wine Chateau Co., Ltd. Beijing City, China Manufacturing 110,000,000 Production and sales of wine 77,000,000 70% 100% Yes 35,293,868
subsidiary
(“Beijing Chateau”) (d) Yuan
Yantai Changyu Wine Yantai City, RMB
Wholly-owned
Sales Co., Ltd. ( “Wine Shandong Province, Sales 5,000,000 Sales of wine 5,000,000 100% 100% Yes
subsidiary
Sales”) China Yuan
Yantai Changyu
Yantai City, RMB
Pioneer International Wholly-owned Import and export of goods
Shandong Province, Sales 5,000,000 5,000,000 100% 100% Yes
Co., Ltd. (“Pioneer subsidiary and technologies
China Yuan
International”)
Hangzhou Changyu Hangzhou City, RMB
Wholly-owned Wholesale and retail of
Wine Sales Co., Ltd. Zhejiang Province, Sales 500,000 500,000 100% 100% Yes
subsidiary stereotypes packaging food
(“Hangzhou Changyu”) China Yuan
Ningxia Changyu Yinchuan City, RMB
Wholly-owned Planting Planting and purchase of 1,000,000 100% 100% Yes
Grape Growing Co., Ningxia Hui 1,000,000
75
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Balance after the owners
Amount for
equity in the parent company
Other balance counteracting
Actual Whether to counteracts the losses of
included into Proportion Proportion Interests of minority
Type of the Registered investment at consolidate minority shareholders in this
Name of the subsidiary Registered place Business nature Business scope the net in shares of voting minority shareholders
subsidiary capital the end of financial term higher than their
investment to (%) power (%) shareholders profits/losses in the
term statements owners equity in the
the subsidiary interests of minority
subsidiaries at the beginning
shareholders
of year
Ltd. (“Ningxia subsidiary Autonomous Region, Yuan grape
Growing”) China
Huanren Changyu
RMB
National Wine Sales Wholly-owned Benxi City, Liaoning
Sales 2,000,000 Wholesale and retail of wine 2,000,000 100% 100% Yes
Co., Ltd. (“National subsidiary Province, China
Yuan
Wines”)
Liaoning Changyu Ice RMB
Holding Benxi City, Liaoning Production and sales of ice
Wine Chateau Co., Ltd. Manufacturing 26,300,000 13,413,000 51% 100% Yes 33,319,062
subsidiary Province, China wine
(“Ice Chateau”) (e) Yuan
Yantai Development Yantai City, RMB
Zone Changyu TradingWholly-owned
Shandong Province, Sales 5,000,000 Wholesale and retail of wine 5,000,000 100% 100% Yes
Co., Ltd. (“Development
subsidiary
Zone Trading”)
China Yuan
Shenzhen Changyu
ShenzhenCity, RMB
Wine Marketing Ltd. Wholly-owned
Guangdong Sales 500,000 Wholesale and retail of wine 500,000 100% 100% Yes
(“Shenzhen subsidiary
Province,China Yuan
Marketing”)
Yantai Fushan District Yantai City, RMB
Wholly-owned
Changyu Trading Co., Shandong Province, Sales 5,000,000 Wholesale and retail of wine 5,000,000 100% 100% Yes
subsidiary
Ltd. (“Fushan Trading”) China Yuan
Beijing AFIP Meeting Wholly-owned Miyun County, Service RMB Meeting service, food, 500,000 100% 100% Yes
76
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Balance after the owners
Amount for
equity in the parent company
Other balance counteracting
Actual Whether to counteracts the losses of
included into Proportion Proportion Interests of minority
Type of the Registered investment at consolidate minority shareholders in this
Name of the subsidiary Registered place Business nature Business scope the net in shares of voting minority shareholders
subsidiary capital the end of financial term higher than their
investment to (%) power (%) shareholders profits/losses in the
term statements owners equity in the
the subsidiary interests of minority
subsidiaries at the beginning
shareholders
of year
Center (“Meeting subsidiary Beijing City, China 500,000 accommodation, tourism and
Center”) (f) Yuan sales of souvenir
Tourism and culture
Beijing AFIP Tourism RMB
Holding Miyun County, communication, development
and Culture Company Tourism 500,000 350,000 70% 100% Yes 2,966,399
subsidiary Beijing City, China of tourist resources and
(“AFIP Tourism”) (g) Yuan
meeting service
Yinchuan City, Production and sales of wine,
Ningxia Changyu RMB
Wholly-owned Ningxia Hui packaging materials and
Pioneer Wine Co., Ltd. Manufacturing 1,000,000 1,000,000 100% 100% Yes
subsidiary Autonomous Region, planting, processing and
(“Ningxia Wine”) Yuan
China purchase of grape
Yantai Changyu Tinlot Yantai City, RMB
Wholly-owned Wholesale and
Chateau Co., Ltd. Shandong Province, 80,000,000 Pre-packaged food 80,000,000 100% 100% Yes
subsidiary retail
(“Tinlot Chateau”) China Yuan
Qingtongxia City,
RMB
Qing Tong Xia Changyu Wholly-owned Ningxia Hui Wholesale and retail of wine
Wine Marketing Ltd. Sales 500,000 500,000 100% 100% Yes
(“Qing Tong Xia Sales) subsidiary Autonomous Region, and business agency
Yuan
China
77
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Balance after the owners
Amount for
equity in the parent company
Other balance counteracting
Actual Whether to counteracts the losses of
included into Proportion Proportion Interests of minority
Type of the Registered investment at consolidate minority shareholders in this
Name of the subsidiary Registered place Business nature Business scope the net in shares of voting minority shareholders
subsidiary capital the end of financial term higher than their
investment to (%) power (%) shareholders profits/losses in the
term statements owners equity in the
the subsidiary interests of minority
subsidiaries at the beginning
shareholders
of year
Xinjiang Changyu Shihezi City,
RMB
Baron Balboa Chateau Wholly-owned Xinjiang Uygur Production and sales of wine
Manufacturing 150,000,000 150,000,000 100% 100% Yes
Co., Ltd. (“Shihezi subsidiary Autonomous Region, (bulk wine)
Yuan
Chateau”) China
Production, processing and
Ningxia Changyu Yinchuan City, sales of wine, distilled wine,
RMB
Mosel XV Chateau Co., Wholly-owned Ningxia Hui non-alcohol beverage and
Manufacturing 2,000,000 2,000,000 100% 100% Yes
Ltd. (“Ningxia subsidiary Autonomous Region, packaging materials, tourism,
Yuan
Chateau”) China meeting reception and
catering service
Shaanxi Changyu Ruina Xianyang City, RMB Planting of grape, processing
Wholly-owned
Chateau Co., Ltd. Shaanxi Province, Manufacturing 20,000,000 of wine, tourism and 20,000,000 100% 100% Yes
subsidiary
(“Changan Chateau”) China Yuan sightseeing
Yantai Changyu Wine
Research and Yantai City, RMB Manufacturing of brandy,
Wholly-owned
Development Co., Ltd. Shandong Province, Manufacturing 500,000,000 wine and sparkling wine and 500,000,000 100% 100% Yes
subsidiary
(“Development China Yuan preparation of sales project
Centre”)
Changyu (Huanren) Wholly-owned Benxi City, Liaoning Preparation for RMB Preparation for wine-making 5,000,000 100% 100% Yes
78
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Balance after the owners
Amount for
equity in the parent company
Other balance counteracting
Actual Whether to counteracts the losses of
included into Proportion Proportion Interests of minority
Type of the Registered investment at consolidate minority shareholders in this
Name of the subsidiary Registered place Business nature Business scope the net in shares of voting minority shareholders
subsidiary capital the end of financial term higher than their
investment to (%) power (%) shareholders profits/losses in the
term statements owners equity in the
the subsidiary interests of minority
subsidiaries at the beginning
shareholders
of year
Wine Co., Ltd. subsidiary Province, China wine-making 5,000,000 project
(“Huanren Wine”) project Yuan
Shihezi City,
Xinjiang Changyu Wine RMB
Wholly-owned Xinjiang Uygur Wholesale of pre-packaged
Sales Co., Ltd. Sales 10,000,000 10,000,000 100% 100% Yes
subsidiary Autonomous Region, food
(“Xinjiang Sales”) Yuan
China
Shihezi City,
Xinjiang Changyu Wine RMB
Wholly-owned Xinjiang Uygur
Co., Ltd. (“Xinjiang Manufacturing 10,000,000 Wine and fruit wine 10,000,000 100% 100% Yes
subsidiary Autonomous Region,
Wine”) Yuan
China
Yinchuan City,
Ningxia Changyu RMB
Wholly-owned Ningxia Hui Wholesale and retail of
Trading Co., Ltd. Sales 1,000,000 1,000,000 100% 100% Yes
subsidiary Autonomous Region, pre-packaged food
(“Ningxia Trading”) Yuan
China
Production and sales of wine;
Shaanxi Changyu Ruina Xianyang City, RMB
Wholly-owned and development of
Wine Sales Co., Ltd. Shaanxi Province, Sales 3,000,000 3,000,000 100% 100% Yes
subsidiary agricultural tourism
(“Shaanxi Sales”) China Yuan
attractions
Penglai Changyu Wine Wholly-owned Penglai City, RMB
Sales Wholesale and retail of wine 5,000,000 100% 100% Yes
Sales Co., Ltd. subsidiary Shandong Province, 5,000,000
79
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Balance after the owners
Amount for
equity in the parent company
Other balance counteracting
Actual Whether to counteracts the losses of
included into Proportion Proportion Interests of minority
Type of the Registered investment at consolidate minority shareholders in this
Name of the subsidiary Registered place Business nature Business scope the net in shares of voting minority shareholders
subsidiary capital the end of financial term higher than their
investment to (%) power (%) shareholders profits/losses in the
term statements owners equity in the
the subsidiary interests of minority
subsidiaries at the beginning
shareholders
of year
(“Penglai Wine”) China Yuan
Laizhou Changyu Wine Laizhou City, RMB
Wholly-owned
Sales Co., Ltd. Shandong Province, Sales 1,000,000 Wholesale and retail of wine 1,000,000 100% 100% Yes
subsidiary
(“Laizhou Wine”) China Yuan
RMB
Beijing Changyu Wholly-owned
Beijing City, China Sales 500,000 Retail of pre-packaged food 500,000 100% 100% Yes
Trading Co., Ltd. subsidiary
Yuan
Tianjin Changyu RMB
Wholly-owned Wholesale of pre-packaged
Pioneer Wine Sales Co., Tianjin City, China Sales 500,000 500,000 100% 100% Yes
subsidiary food
Ltd. (j) Yuan
Fuzhou Changyu RMB
Wholly-owned Fuzhou City, Fujian Wholesale of pre-packaged
Pioneer Wine Co., Ltd. Sales 500,000 500,000 100% 100% Yes
subsidiary Province, China food
(j) Yuan
Nanjing Changyu RMB
Wholly-owned Nanjing City, Jiangsu Wholesale of pre-packaged
Pioneer Wine Co., Ltd. Sales 500,000 500,000 100% 100% Yes
subsidiary Province, China food
(j) Yuan
Xianyang Changyu Xianyang City, RMB
Wholly-owned Wholesale of pre-packaged
Pioneer Drinks Sales Shaanxi Province, Sales 500,000 500,000 100% 100% Yes
subsidiary food
Co., Ltd. (j) China Yuan
Shenyang Changyu Wholly-owned Shenyang City, Sales RMB Wholesale of pre-packaged 500,000 100% 100% Yes
80
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Balance after the owners
Amount for
equity in the parent company
Other balance counteracting
Actual Whether to counteracts the losses of
included into Proportion Proportion Interests of minority
Type of the Registered investment at consolidate minority shareholders in this
Name of the subsidiary Registered place Business nature Business scope the net in shares of voting minority shareholders
subsidiary capital the end of financial term higher than their
investment to (%) power (%) shareholders profits/losses in the
term statements owners equity in the
the subsidiary interests of minority
subsidiaries at the beginning
shareholders
of year
Pioneer Wine Co., Ltd. subsidiary Liaoning Province, 500,000 food
(j) China Yuan
RMB
Jinan Changyu Pioneer Wholly-owned Jinan City, Shandong Wholesale of pre-packaged
Sales 500,000 500,000 100% 100% Yes
Drinks Co., Ltd. (j) subsidiary Province, China food
Yuan
Shanghai Changyu RMB
Wholly-owned Shanghai City, Wholesale of pre-packaged
Pioneer Wine Co., Ltd. Sales 500,000 500,000 100% 100% Yes
subsidiary China food
(j) Yuan
Fuzhou Changyu RMB
Wholly-owned Fuzhou City, Jiangxi Wholesale of pre-packaged
Pioneer Wine Co., Ltd. Sales 500,000 500,000 100% 100% Yes
subsidiary Province, China food
(j) Yuan
Shijiazhuang Changyu Shijiazhuang City, RMB
Wholly-owned Wholesale of pre-packaged
Pioneer Wine Sales Co., Hebei Province, Sales 500,000 500,000 100% 100% Yes
subsidiary food
Ltd. (j) China Yuan
Hangzhou City, RMB
Hangzhou Yuzefeng Wholly-owned Wholesale of pre-packaged
Zhejiang Province, Sales 500,000 500,000 100% 100% Yes
Trading Co., Ltd. (j) subsidiary food
China Yuan
Jilin Province Changyu RMB
Wholly-owned Changchun City, Wholesale of pre-packaged
Pioneer Wine Co., Ltd. Sales 500,000 500,000 100% 100% Yes
subsidiary Jilin Province, China food
(j) Yuan
81
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Balance after the owners
Amount for
equity in the parent company
Other balance counteracting
Actual Whether to counteracts the losses of
included into Proportion Proportion Interests of minority
Type of the Registered investment at consolidate minority shareholders in this
Name of the subsidiary Registered place Business nature Business scope the net in shares of voting minority shareholders
subsidiary capital the end of financial term higher than their
investment to (%) power (%) shareholders profits/losses in the
term statements owners equity in the
the subsidiary interests of minority
subsidiaries at the beginning
shareholders
of year
Beijing Changyu RMB
Wholly-owned Wholesale of pre-packaged
Pioneer Wine Sales Co., Beijing City, China Sales 500,000 500,000 100% 100% Yes
subsidiary food
Ltd. (j) Yuan
Harbin Changyu Harbin City, RMB
Wholly-owned Wholesale of pre-packaged
Pioneer Wine Sales Co., Heilongjiang Sales 500,000 500,000 100% 100% Yes
subsidiary food
Ltd. (j) Province, China Yuan
Hunan Changyu Changsha City, RMB
Wholly-owned Wholesale of pre-packaged
Pioneer Wine Co., Ltd. Hunan Province, Sales 2,000,000 2,000,000 100% 100% Yes
subsidiary food
(j) China Yuan
Yinchuan City,
Yinchuan Changyu RMB
Wholly-owned Ningxia Hui Wholesale of pre-packaged
Pioneer Wine Co., Ltd. Sales 500,000 500,000 100% 100% Yes
subsidiary Autonomous Region, food
(j) Yuan
China
Kunming Changyu Kunming City, RMB
Wholly-owned Wholesale of pre-packaged
Pioneer Wine Co., Ltd. Yunan Province, Sales 500,000 500,000 100% 100% Yes
subsidiary food
(j) China Yuan
82
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Notes: (b) Changyu Chateau is a Sino-foreign joint venture established by the Company and a foreign
investor. Pursuant to an operation contract signed by the Company and Changyu Chateau, the
Company is entrusted to manage Changyu Chateau by paying contracting fees and therefore has
the full power to control its strategic operating, investing and financing policies. The operation
agreement will terminate on December 31, 2022.
(c) Langfang Castel is a Sino-foreign joint venture established by the Company and a foreign investor.
Pursuant to the agreement signed by the Company and Langfang Castel, the Company is entrusted
to manage Langfang Castel by paying contracting fees and therefore has the full power to control
its strategic operating, investing and financing policies, therefore the financial statements of
Langfang Castel are consolidated in the Groups financial statements. The operation agreement
will terminate on December 31, 2022.
(d) Beijing Chateau is a limited liability company established by the Company and a domestic
investor. Pursuant to an operation contract signed by the Company and Beijing Chateau, the
Company is entrusted to manage Beijing Chateau by paying contracting fees and therefore has the
full power to control its strategic operating, investing and financing policies. The operation
agreement will terminate on September 2, 2019.
(e) Ice Chateau is a Sino-foreign joint venture established by the Company and a foreign investor.
Pursuant to the agreement signed by the Company, Ice Chateau and the foreign investor, the
Company is entrusted to manage Ice Chateau by paying contracting fees and therefore has the full
power to control its strategic operating, investing and financing policies. The operation agreement
will terminate at December 31, 2016.
(f) Conference Center is a wholly-owned subsidiary of Beijing Chateau.
(g) AFIP Tourism is a limited liability company established by the Company and a domestic investor.
Pursuant to an operation contract signed by the Company and AFIP, the Company is entrusted to
manage AFIP by paying contracting fees and therefore has the full power to control its strategic
operating, investing and financing policies. The operation contract will terminate on September 2,
2019.
(i) Laizhou Sales Wine is a limited liability company established by the Company in 2013 with the
registered capital of RMB 1,000,000 Yuan. By December 31, 2013, the Company had completed
all the capital contributions.
(j) are the wholly-owned subsidiaries of Pioneer International.
6.1.2 Subsidiary acquired from a business combination under non-common control
Unit: Yuan
Name of the Type of the Registered Business Registered Business Actual Other Proportion Proportion Whether to Interests of Amount for Balance
subsidiary subsidiary place nature capital scope investment balance in shares of voting consolidate minority counteracting after the
83
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
at the end included (%) power (%) financial shareholders minority owners
of term into the statements shareholders equity in the
net profits/losses parent
investment in the company
to the interests of counteracts
subsidiary minority the losses of
shareholders minority
shareholders
in this term
higher than
their
owners
equity in the
subsidiaries
at the
beginning
of year
Shihezi City,
Xinjiang
Xinjiang Production
Tianzhu Wine Holding RMB
Uygur and
Co., Ltd. subsidiary Manufacturing 75,000,000 60,000,000 60% 100% Yes 56,093,912
Autonomous sales of
(“Xinjiang Yuan
Region, wine
Tianzhu”) (a)
China
Trading,
Etablissements brokerage
Roullet and sales
Wholly-owned Cognac, EUR
Fransac Trading agency of 100% 100% Yes
subsidiary France 2,896,531
(“France wine, liquor
Trading”) (h) and other
drinks
Notes: (a) Xinjiang Tianzhu is a subsidiary of the Company by merger and acquisition in August 2009,
whose 60% of the shares are held by the Company. Pursuant to an operation contract signed by the
Company and Xinjiang Tianzhu, the Company is entrusted to manage Xinjiang Chateau by paying
contracting fees and therefore has the full power to control its strategic operating, investing and
financing policies. The operation agreement will terminate on December 31, 2018.
(h) France Trading is a subsidiary of the Company by merger and acquisition in December 2013,
whose 100% of the shares are held by the Company.
84
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
6.2 Notes on changes in the scope of consolidation
The scope of consolidated financial statements conforms with the last year except that the
subsidiaries are newly established or acquired in this year.
6.3 Entities included or excluded in the scope of consolidation in the report period
Subsidiaries, entities with special purpose, or entities on which the Company has controlling power
through entrusted operation or leasing included in the scope of consolidation in this term.
Unit: Yuan
Name Net asset at the end of term Net profit of the this term
Beijing Changyu Trading Co., Ltd. 500,000 -
Tianjin Changyu Pioneer Wine Sales Co., Ltd. (j) 494,776 -5,224
Fuzhou Changyu Pioneer Wine Co., Ltd. (j) 500,000 -
Nanjing Changyu Pioneer Wine Co., Ltd. (j) 500,000 -
Xianyang Changyu Pioneer Drinks Sales Co., Ltd. (j) 500,000 -
Shenyang Changyu Pioneer Wine Co., Ltd. (j) 500,000 -
Jinan Changyu Pioneer Drinks Co., Ltd. (j) 363,773 -136,227
Shanghai Changyu Pioneer Wine Co., Ltd. (j) 500,000 -
Fuzhou Changyu Pioneer Wine Co., Ltd. (j) 500,000 -
Shijiazhuang Changyu Pioneer Wine Sales Co., Ltd. 433,234 -66,766
(j)
Hangzhou Yuzefeng Trading Co., Ltd. (j) 500,000 -
Jilin Province Changyu Pioneer Wine Co., Ltd. (j) 363,756 -136,244
Beijing Changyu Pioneer Wine Sales Co., Ltd. (j) 500,000 -
Harbin Changyu Pioneer Wine Sales Co., Ltd. (j) 500,000 -
Hunan Changyu Pioneer Wine Co., Ltd. (j) 2,000,000 -
Yinchuan Changyu Pioneer Wine Co., Ltd. (j) 500,000 -
Kunming Changyu Pioneer Wine Co., Ltd. (j) 421,229 -78,771
Notes: Established in April 2014, Beijing Changyu Trading Co., Ltd. is a wholly-owned subsidiary
of Beijing Chateau with the registered capital of RMB 500,000 Yuan.
(j) are newly established limit liability companies and are the wholly-owned subsidiaries of Pioneer
International.
6.4 Translation of exchange rate of main accounts of overseas businesses
The statement of France Trading, an overseas subsidiary, shall adopt EUR as recording currency.
When compiling consolidated statement, EUR 1 shall be converted into RMB 8.3946 Yuan.
7. Notes to consolidated financial statements
7.1 Monetary fund
Unit: Yuan
85
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Ending sum Beginning sum
Item Foreign Conversion Foreign Conversion
RMB RMB
currency rate currency rate
Cash: -- -- 59,735 -- -- 772,817
RMB -- -- 59,735 -- -- 772,817
Bank deposit: -- -- 1,734,396,909 -- -- 1,235,788,080
RMB -- -- 1,723,847,765 -- -- 1,222,683,414
EUR 1,256,658 8.3946 10,549,144 1,556,577 8.4189 13,104,666
Other monetary funds: -- -- 127,085,283 -- -- 131,257,285
RMB -- -- 127,085,283 -- -- 131,257,285
Total -- -- 1,861,541,927 -- -- 1,367,818,182
As at June 30, 2014, the bank deposit with restricted ownership of the Group is RMB 2,687,519 Yuan, which
is the companys housing fund (December 31, 2013: RMB 2,609,237 Yuan).
As at June 30, 2014, other monetary funds of the Group include pledge deposit of RMB 125,000,000 Yuan
for short-term loans from HSBC of HKD 303,963,343 (converting into RMB 243,170,674 Yuan),
refundable of bills payable of RMB 1,670,000 Yuan (December 31, 2012: RMB 5,965,996 Yuan) and
guaranty money for deposits for the card of your company of RMB 415,283 Yuan.
As at June 30, 2014, the Group has monetary fund of RMB 10,549,144 Yuan that is deposited beyond the
boundaries (December 31, 2013: RMB 13,104,666 Yuan).
The bank deposit of short-term time deposit range from 3 months to 1 year as at June 30, 2014 is RMB
126,547,482 Yuan (December 31, 2013: RMB 277,392,728 Yuan), with maturity terms ranging from 3
months to 1 year, and the interest rates ranging from 2.86%-3.58%.
7.2 Bills receivable
7.2.1 Classification of bills receivable
Unit: Yuan
Type Ending sum Beginning sum
Banks acceptance bill 270,389,669 79,702,753
Total 270,389,669 79,702,753
7.2.2 Pledged bills receivable at the term end
Nil
86
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.2.3 Bills receivable reclassified as accounts receivable due to the default of drawer
Nil
7.2.4 Bills receivable endorsed to the third parties but not yet matured by the Company at the term
end are as follows:
Unit: Yuan
Drawer Issuing date Maturity date Amount Remark
Wenzhou Yuxiang Trading Co., Ltd. January 2, 2014 July 2, 2014 3,100,000
Zibo Wenhong Commerce and Trade
January 26, 2014 July 26, 2014 1,575,000
Co., Ltd.
Zhongshan Fuqiao Commerce and
March 14, 2014 September 14, 2014 1,000,000
Trade Co., Ltd.
Pingyang County Aojiang Town
January 3, 2014 July 3, 2014 700,000
Pinquan Food Business Department
Cixi Tianlong Wine Industry Co., Ltd. January 26, 2014 July 26, 2014 635,982
Total -- -- 7,010,982 --
7.3 Interest receivable
7.3.1 Interest receivable
Unit: Yuan
Item Beginning sum Increase Decrease Ending sum
Bank fixed deposits
8,417,995 3,997,874 5,937,606 6,478,263
interest
Total 8,417,995 3,997,874 5,937,606 6,478,263
As at June 30, 2014, there is no overdue interest.
7.4 Accounts receivable
7.4.1 Accounts receivable disclosed by type
Unit: Yuan
Ending sum Beginning sum
Type Book balance Bad debt provision Book balance Bad debt provision
Amount Proportion Amount Proportion Amount Proportion Amount Proportion
Accounts receivable of
significant single amount
49,802,762 39.6% 72,118,959 40.7%
and single accrued bad
debt provision
Accounts receivable of
insignificant single
76,080,183 60.4% 104,990,557 59.3%
amount and single accrued
bad debt provision
Total 125,882,945 -- -- 177,109,516 -- --
The credit term of account receivable is normally one month. Major customers can be granted a credit term
87
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
up to three months. The accounts receivable balances are interest free.
7.4.2 Accounts receivable transferred back or received in this term
Nil
7.4.3 Accounts receivable actually cancelled after verification in this term
Nil
7.4.4 Accounts receivable due from shareholders with voting rights of 5% (including 5%) or above
in this term
Nil
7.4.5 Top 5 units of accounts receivable
Unit: Yuan
Relationship with the Percentage of total
Unit Amount Period
Company accounts receivable
Nonggongshang
Supermarket (Group) Third party 14,287,627 Within 1 year 11.4%
Co., Ltd.
Kunshan Runhua
Commercial Co., Ltd.
Third party 5,334,602 Within 1 year 4.2%
Guangzhou Huangpu
Branch
Suguo Supermarket Co.,
Third party 4,843,618 Within 1 year 3.8%
Ltd.
Kangcheng Investment
Third party 4,103,348 Within 1 year 3.3%
(China) Co., Ltd.
Wal-mart (China)
Third party 4,055,653 Within 1 year 3.2%
Investment Co., Ltd.
Total -- 32,624,848 -- 25.9%
7.4.6 Accounts receivable from related parties
Unit: Yuan
Percentage of total accounts
Unit Relationship with the Company Amount
receivable
Yantai Changyu Wine Culture Under the control of the same
53,114 0.04%
Museum Co., Ltd. parent company
Total -- 53,114 0.04%
7.4.7 Accounts receivable terminating confirmation
Nil
88
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.5 Other accounts receivable
7.5.1 Other accounts receivable disclosed by type
Ending sum Beginning sum
Type Book balance Bad debt provision Book balance Bad debt provision
Amount Proportion Amount Proportion Amount Proportion Amount Proportion
Other accounts receivable
of significant single
65,272,429 64.0% 7,392,429 11.3% 65,272,429 61.2% 7,392,429 11.3%
amount and single accrued
bad debt provision
Other accounts receivable
of insignificant single
36,749,107 36.0% 41,451,794 38.8%
amount and single accrued
bad debt provision
Total 102,021,536 -- 7,392,429 -- 106,724,223 -- 7,392,429 --
Other accounts receivable of significant single amount and single accrued bad debt provision at the
end of term:
Unit: Yuan
Other accounts
Book balance Bad debt Accrued proportion Reason
receivable
Tiantong Securities Co., This company is in
7,392,429 7,392,429 100%
Ltd. bankruptcy liquidation.
Total 7,392,429 7,392,429 -- --
7.5.2 Other accounts receivable transferred back or received in this term
Nil
7.5.3 Other accounts receivable actually cancelled after verification in this term
Nil
7.5.4 Other accounts receivable due from shareholders with voting rights of 5% (including 5%) or
above in this term
Unit: Yuan
Ending sum Beginning sum
Unit Accrued amount for Accrued amount for
Book balance Book balance
bad debt bad debt
Yantai Changyu Group Co., Ltd. 2,954,000
Total 2,954,000
7.5.5 Nature or content of other accounts receivable of significant amount
Unit: Yuan
89
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Percentage of total other accounts
Unit Amount Nature or content of fund
receivable
YEDA Finance Bureau Special
52,880,000 Guarantee fund
Non-tax Account 51.8%
Tiantong Securities Co., Ltd. 7,392,429 Investment fund 7.2%
YEDA Construction Industry
5,000,000 Guarantee fund
Association 4.9%
Total 65,272,429 -- 63.9%
7.5.6 Top 5 units of other accounts receivable
Unit: Yuan
Relationship with the Percentage of total other
Unit Amount Period
Company accounts receivable
YEDA Finance Bureau
Third party 52,880,000 1-2 years
Special Non-tax Account 51.8%
Tiantong Securities Co.,
Third party 7,392,429 More than 3 years
Ltd. 7.2%
YEDA Construction
Third party 5,000,000 1-2 years
Industry Association 4.9%
Liaoning Provincial
Administration of Third party 1,894,055 1-2 years
Foreign Experts Affairs 1.9%
Beijing Carrefour
Third party 521,050 Within 1 year
Commercial Co., Ltd. 0.5%
Total 67,687,534 -- 66.3%
7.6 Advanced payment
7.6.1 Advanced payment listed by age
Unit: Yuan
Ending sum Beginning sum
Age
Amount Proportion Amount Proportion
Within 1 year 12,631,073 100% 45,997,863 100%
1-2 years
2-3 years
More than 3 years
Total 12,631,073 -- 45,997,863 --
90
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.6.2 Top 5 units of advanced payment
Unit: Yuan
Relationship with
Unit Amount Time Reason for unsettlement
the Company
Yantai Yangguang Furniture Garden
Third party 1,712,032 Within 1 year Failure to receive goods
Co., Ltd.
Weifang Qingxin Greening Engineering has not been
Third party 800,000 Within 1 year
Engineering Co., Ltd. completed
Yantai Power Supply Company Third party 802,438 Within 1 year Failure to receive goods
Longkou City Shiza Fruit Co., Ltd. Third party 730,000 Within 1 year Failure to receive goods
Beijing Jiamei Building and Engineering has not been
Third party 504,000 Within 1 year
Decorative Engineering Co., Ltd. completed
Total -- 4,548,470 -- --
7.6.3 Advanced payment due from shareholders with voting rights of 5% (including 5%) or above
in this term
Nil
7.7 Inventories
7.7.1 Inventory classification
Unit: Yuan
Ending sum Beginning sum
Item Depreciation Depreciation
Book balance Book value Book balance Book value
provision provision
Raw materials 75,904,840 75,904,840 85,025,169 85,025,169
Goods in process 788,663,525 788,663,525 930,137,624 930,137,624
Commodity stocks 911,920,357 13,135,590 898,784,767 1,119,090,234 13,135,590 1,105,954,644
Total 1,776,488,722 13,135,590 1,763,353,132 2,134,253,027 13,135,590 2,121,117,437
7.7.2 Inventory depreciation provision
Unit: Yuan
Book balance at the Decrease Book balance at the
Inventory type Accrual
beginning of term Reversal Write off end of term
Raw materials
91
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Goods in process
Commodity stocks 13,135,590 13,135,590
Total 13,135,590 13,135,590
92
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.8 Long-term equity investment
7.8.1 Particulars of long-term equity investment
Unit: Yuan
Explanation for
difference between the
Proportion of Proportion of proportion of Accrued
Impairment Cash
Invest to Calculation method Beginning balance Change End balance shareholding in voting power in shareholding and depreciation
Investment cost provision dividend
the invested unit the invested unit proportion of voting provision
power in the invested
unit
Yantai Dingtao Construction and
Development Co., Ltd. (“Yantai Cost method 10,000,000 10,000,000 10,000,000 18% 18% 10,000,000
Dingtao”)
Total -- 10,000,000 10,000,000 10,000,000 -- -- -- 10,000,000
7.8.2 Restrictions of ability to transfer capitals to the invested company
Nil
93
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.9 Fixed assets
7.9.1 Particulars of fixed assets
Unit: Yuan
Book balance at the beginning of Book balance at the end of
Item Increase Decrease
term term
1. Total original book value 2,725,164,423 131,447,777 215,475 2,856,396,725
Including: buildings 1,464,646,808 117,927,639 1,582,574,447
Machineries and equipment 1,236,192,126 12,651,837 215,475 1,248,628,488
Motor vehicles 24,325,489 868,301 25,193,790
Book balance at the beginning of Book balance at the end of
-- Increase Accrual Decrease
term term
2. Total accumulated depreciation: 807,523,079 65,837,616 204,478 873,156,217
Including: buildings 222,433,019 21,839,667 244,272,686
Machineries and equipment 565,658,995 42,236,359 204,478 607,690,876
Motor vehicles 19,431,065 1,761,590 21,192,655
Book balance at the beginning of Book balance at the end of
-- --
term term
3. Total net book value of fixed
1,917,641,344 -- 1,983,240,508
assets
Including: buildings 1,242,213,789 -- 1,338,301,761
Machineries and equipments 670,533,131 -- 640,937,612
Motor vehicles 4,894,424 -- 4,001,135
4. Total impairment provision --
Including: buildings --
Machineries and equipment --
Motor vehicles --
5. Total book value of fixed assets 1,917,641,344 -- 1,983,240,508
Including: buildings 1,242,213,789 -- 1,338,301,761
94
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Machineries and equipment 670,533,131 -- 640,937,612
Motor vehicles 4,894,424 -- 4,001,135
The depreciation amount of this term is RMB 65,837,616 Yuan and the original value of the fixed
assets transferred from goods in process is RMB 64,707,925 Yuan.
7.9.2 Temporarily idle fixed assets
Nil
7.9.3 Fixed assets under finance leases
Nil
7.9.4 Fixed assets under operating lease
Nil
7.9.5 Fixed assets for sale at the end of term
Nil
7.9.6 Fixed assets without property certificates
Reason for not receiving property
Item Time to get the property certificate
certificate
Beijing Chateau European Town, Main
Under transaction 2014
Building and Service Building
Ningxia Mosel Chateau Under transaction 2014
Changyu (Jingyang) Vintage Workshop Under transaction 2014
Xinjiang Tianzhu Fermentation and
Under transaction 2014
Storage Workshop
Ice Wine Chateau Office Building and
Under transaction 2014
Packing Workshop
Office of Sales Company Provincial
Under transaction 2014
Sub-office
Kylin Packaging Finish Goods Warehouse
Under transaction 2014
and Workshop
95
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Fermentation Centre Office Tower,
Under transaction 2014
Laboratory Building and Workshop
7.10 Construction in progress
7.10.1 Construction in progress
Unit: Yuan
Ending sum Beginning sum
Item
Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Construction and Reconstruction Project of
Joint-stock Company 650,821 650,821 269,802 269,802
Xinjiang Tianzhu Technological Innovation
306,369 306,369 1,018,309 1,018,309
Reconstruction Project
Kylin Packaging Workshop Production Line Installation
133,800 133,800 19,800 19,800
Project
Yantai Chateau Mu Ziguo Vineyard Project 14,496,700 14,496,700 10,619,000 10,619,000
Ningxia Chateau Road Project 600,000 600,000 600,000 600,000
Sales Company Building Project 70,914,652 70,914,652 66,682,027 66,682,027
Jingyang Fermentation Workshop Reconstruction Project 158,569 158,569 158,569 158,569
Ningxia United Brewing Workshop Project 1,464,202 1,464,202 1,464,202 1,464,202
Shihezi Chateau Construction Project 116,448,859 116,448,859 152,871,244 152,871,244
Ningxia Chateau Construction Project 141,362,231 141,362,231 92,062,210 92,062,210
Xianyang Chateau Construction Project 506,218,846 506,218,846 403,657,745 403,657,745
R&D Center Construction Project 675,182,369 675,182,369 558,716,989 558,716,989
Tinlot Chateau Construction Project 137,381,887 137,381,887 119,074,949 119,074,949
Huanren Brewing Workshop Construction Project 22,911,424 22,911,424 16,439,684 16,439,684
French House Reconstruction 323,874 323,874
Total 1,688,554,603 1,688,554,603 1,423,654,530 1,423,654,530
96
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.10.2 Changes of major construction in progress
Unit: Yuan
Including:
Proportion
Transferred Accumulative capitalization Capitalization
Other of project Construction
Item Budget Beginning sum Increase capitalization amount of ratio of interest in Capital source Ending sum
to fixed assets decrease input in progress
amount of interest interest in this this term (%)
budget (%)
term
Construction and
Reconstruction
Project of 201,440,000 269,802 381,019 90.4% Self-financing 650,821
Joint-stock Company
Xinjiang Tianzhu
Technological
Innovation 3,500,000 1,018,309 1,766,298 2,478,238 85.5% Self-financing 306,369
Reconstruction
Project
Kylin Packaging
Workshop
Production Line
6,200,000 19,800 122,760 8,760 88.9% Self-financing 133,800
Installation Project
Yantai Chateau Mu
Ziguo Vineyard 30,000,000 10,619,000 3,877,700 48.3% Self-financing 14,496,700
Project
Ningxia Chateau
Road Project
600,000 600,000 100% Self-financing 600,000
Sales Company
Building Project
106,350,000 66,682,027 4,232,625 120.9% Self-financing 70,914,652
Jingyang
Fermentation
Workshop 26,000,000 158,569 72.8% Self-financing 158,569
Reconstruction
Project
Ningxia United
Brewing Workshop 58,700,000 1,464,202 98% Self-financing 1,464,202
Project
Shihezi Chateau
Construction Project
750,000,000 152,871,244 25,444,545 61,866,930 78.4% Self-financing 116,448,859
Ningxia Chateau
Construction Project
284,150,000 92,062,210 49,300,021 121.7% Self-financing 141,362,231
Xianyang Chateau
Construction Project
440,740,000 403,657,745 102,915,098 353,997 115% Self-financing 506,218,846
R&D Center 1,693,970,000 558,716,989 116,465,380 44.3% Self-financing 675,182,369
97
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Including:
Proportion
Transferred Accumulative capitalization Capitalization
Other of project Construction
Item Budget Beginning sum Increase capitalization amount of ratio of interest in Capital source Ending sum
to fixed assets decrease input in progress
amount of interest interest in this this term (%)
budget (%)
term
Construction Project
Tinlot Chateau
Construction Project
152,400,000 119,074,949 18,306,938 90.1% Self-financing 137,381,887
Huanren Brewing
Workshop 15,000,000 16,439,684 6,471,740 152.7% Self-financing 22,911,424
Construction Project
French House
Reconstruction
323,874 Self-financing 323,874
Total 3,769,050,000 1,423,654,530 329,607,998 64,707,925 -- -- -- -- 1,688,554,603
98
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
As at June 30, 2014, there is no indication for impairment in construction in process of the Group,
so no provision is made.
7.11 Productive biological assets
7.11.1 Calculating by cost
Unit: Yuan
Book balance at the Book balance at the end
Item Increase Decrease
beginning of term of term
1. Plantation
Grape Seedling 101,794,515 21,661,547 337,724 123,118,338
Total 101,794,515 21,661,547 337,724 123,118,338
As at June 30, 2014, no ownership of the biological asset is restricted.
As at June 30, 2014, there is no indication that biological assets may be impaired, and no provision is
made.
7.12 Intangible assets
7.12.1 Particulars of intangible assets
Unit: Yuan
Book balance at the Book balance at the end
Item Increase Decrease
beginning of term of term
1. Total original book
328,166,462 7,973,379 336,139,841
value
Land use right 301,043,015 301,043,015
Software fee 27,123,447 7,973,379 35,096,826
2. Total accumulated
32,036,708 4,914,237 36,950,945
amortization
Land use right 27,687,916 3,786,614 31,474,530
Software fee 4,348,792 1,127,623 5,476,415
3. Total net book value of
296,129,754 299,188,896
intangible assets
Land use right 273,355,099 269,568,485
Software fee 22,774,655 29,620,411
4. Total depreciation
provision
Land use right
Software fee
Total book value of
296,129,754 299,188,896
intangible assets
Land use right 273,355,099 269,568,485
Software fee 22,774,655 29,620,411
The amortization amount in current period is RMB 4,914,237 Yuan.
99
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
As at June 30, 2014, there are no restricted intangible assets.
7.13 Goodwill
Unit: Yuan
Name of the invested unit Balance at the Impairment provision at
Increase Decrease Balance at the end of term
or formed goodwill beginning of term the end of term
France Trading 13,112,525 13,112,525
Total 13,112,525 13,112,525
7.14 Long term prepaid expenses
Unit: Yuan
Reason for other
Item Beginning sum Increase Amortization Other decrease Ending sum
decrease
Land lease fees 62,501,074 650,636 61,850,438
Land-use fees 48,391,000 525,293 47,865,707
Afforestation fees 43,693,264 3,747,232 5,284,388 42,156,108
Other 10,936,465 14,298,489 853,339 24,381,615
Total 165,521,803 18,045,721 7,313,656 176,253,868 --
7.15 Deferred tax assets and liabilities
7.15.1 Deferred tax assets and liabilities arent presented in net amounts after setoff.
Confirmed deferred tax assets and liabilities
Unit: Yuan
Item Ending sum Beginning sum
Deferred tax assets:
Asset impairment provision 7,632,005 7,632,005
Organization cost 31,637,235 24,346,814
Deductible loss 98,006,614 84,493,108
Unrealized profits from inter-company
12,790,305 19,635,738
transactions
Unpaid bonus 4,440,489 4,877,490
Early retirement benefit 16,412,794 17,547,935
Deferred income 170,919,442 158,533,090
Subtotal 7,632,005 7,632,005
Deferred tax liabilities:
Appraisement of trading financial instruments and
derivative financial instruments
Change of fair value of financial assets for sale
included in the capital reserve
Fair value adjustment in business combination
5,336,115 5,336,115
under non-common control
Subtotal 5,336,115 5,336,115
100
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Unconfirmed deferred tax assets
Unit: Yuan
Item Ending sum Beginning sum
Deductible temporary difference
Deductible loss 20,440,916 20,440,916
Total 20,440,916 20,440,916
Deductible losses not confirmed for deferred tax assets will expire in:
Unit: Yuan
Year Ending sum Beginning sum Remark
2014 19,077,494 19,077,494
2015 1,363,422 1,363,422
Total 20,440,916 20,440,916 --
Taxable differences and deductible differences
Unit: Yuan
Temporary difference
Item
At the end of term At the beginning of term
Taxable difference
Fair value adjustment in business combination under non-common control 21,344,460 21,344,460
Subtotal 21,344,460 21,344,460
Deductible difference
Unrealized profits from inter-company transactions 392,026,455 337,972,438
Unpaid bonus 51,161,218 78,542,951
Early retirement benefit 17,761,953 19,509,959
Provision for impairment 30,528,019 30,528,019
Deductible loss 126,548,940 97,387,257
Deferred income 90,068,942 96,526,843
Subtotal 708,095,527 660,467,467
7.16 Provision for impairment of assets
Unit: Yuan
Book balance at the Decrease Book balance at
Item Increase
beginning of term Reversal Write off the end of term
101
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Bad debt provision 7,392,429 7,392,429
Inventory impairment
13,135,590 13,135,590
provision
Provision for impairment of
10,000,000 10,000,000
long-term equity investment
Total 30,528,019 30,528,019
7.17 Other non-current assets
Unit: Yuan
Item Ending sum Beginning sum
1. Receivable Ningxia planting biological assets
21,370,902 21,370,902
transfer expenses
2. Unconfirmed financing expenses 3,348,526 3,601,902
Total 24,719,428 24,972,804
7.18 Short-term loan
7.18.1 Classification of short-term loan
Unit: Yuan
Item Ending sum Beginning sum
Pledge loan 243,170,674 243,170,674
Collateralised loan
Guaranteed loan
Fiduciary loan
Total 243,170,674 243,170,674
The Company signed a pledge loan contract with HSBC Bank (China) Company Limited Qingdao
Branch on June 30, 2014 and borrowed a loan of HKD 303,963,343 from HSBC Bank (China)
Company Limited Qingdao Branch with the bank deposit of RMB 125,000,000 Yuan as the pledge.
The annual interest rate is 1.8%, and the term of loan is from July 5, 2013 to July 4, 2014.
7.19 Notes payable
Unit: Yuan
Type Ending sum Beginning sum
Commercial acceptance bill
Banks acceptance bill 1,670,000 5,765,694
Total 1,670,000 5,765,694
7.20 Accounts payable
7.20.1 Particulars of accounts payable
Unit: Yuan
Item Ending sum Beginning sum
Purchase goods and accept services 260,590,660 258,116,331
102
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Total 260,590,660 258,116,331
7.20.2 Accounts payable due from shareholders with voting rights of 5% (including 5%) or above in
this term
Nil
7.20.3 Payables of significant amount aged more than one year
As at June 30, 2014, the Group has no significant outstanding balances aged more than one year.
7.21 Advances from customers
7.21.1 Particulars of advances from customers
Unit: Yuan
Item Ending sum Beginning sum
Advances from customers for selling goods 297,711,405 188,651,254
Total 297,711,405 188,651,254
7.21.2 Advances from customers due from shareholders with voting rights of 5% (including 5%) or
above in this term
Nil
7.21.3 Advances from customers of significant amount aged more than one year
As at June 30, 2014, the Group has no advances from customers of significant amount aged more
than one year.
7.22 Employee benefits payable
Unit: Yuan
Book balance at the beginning of Book balance at the end of
Item Increase Decrease
term term
1. Salaries and bonus 86,538,149 136,243,858 138,085,625 84,696,382
2. Staff benefit 6,135,714 6,135,714
3. Staff welfare 177,262 21,980,068 20,806,176 1,351,154
Including: Medical insurance 153,590 6,950,160 6,628,248 475,502
Pension 23,449 13,098,745 12,344,003 778,191
Unemployment insurance 223 765,816 746,510 19,529
Injury insurance 608,310 567,754 40,556
Maternity insurance 557,037 519,661 37,376
4. Housing fund 9,932 4,407,744 4,174,880 242,796
5. Dismiss welfare 23,107,920 408,281 2,405,722 21,110,479
6. Other
103
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Book balance at the beginning of Book balance at the end of
Item Increase Decrease
term term
7. Union fee and education fee 2,382,001 1,042,241 1,078,150 2,346,092
8. Subsidy and allowance of
22,106,873 17,490 17,490 22,106,873
employees
Total 134,322,137 170,235,396 172,703,757 131,853,776
There is no amount in arrears in the employee compensation payable.
The union fee and education fee is RMB 1,078,150 Yuan. There is no non-monetary welfare. The
compensation for release of employees is RMB 2,405,722 Yuan.
7.23 Tax payable
Unit: Yuan
Item Ending sum Beginning sum
Value added tax -20,715,939 862,414
Consumption tax 11,412,792 26,658,283
Business tax 148,131 4,348,055
Corporate income tax 59,107,848 142,079,369
Individual income tax 6,684,685 6,824,553
Urban maintenance and construction tax 2,704,544 6,016,703
Property tax 595,342 655,545
Urban land use tax 733,287 878,982
Other 2,706,687 6,089,526
Total 63,377,377 194,413,430
7.24 Interest payable
Unit: Yuan
Item Ending sum Beginning sum
Long-term loan interest of installment and interest
charges, repayment of principal at maturity
Enterprise bond interest
Interest payable of short-term loan 4,279,802 2,152,059
Total 4,279,802 2,152,059
7.25 Other payables
7.25.1 Particulars of other payables
Unit: Yuan
Item Ending sum Beginning sum
Distributors deposit payable 160,076,917 215,888,735
Payable for trademark usage of the Group 43,413,264 78,986,198
Payables for equipment purchases, construction 74,910,291
63,133,029
costs and transportation charges
Advertising expenses payable 140,624,078 51,854,647
104
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Payables for deposit of suppliers 1,875,823 2,565,206
Other 81,506,614 84,873,815
Total 502,406,987 497,301,630
7.25.2 Other payable due from shareholders with voting rights of 5% (including 5%) or above in
this term is as follows:
Unit: Yuan
Unit Ending sum Beginning sum
Yantai Changyu Group Co., Ltd. 43,413,264 78,986,198
Total 43,413,264 78,986,198
7.25.3 Other payables of significant amount aged more than one year
Unit Amount payable Outstanding reason
Dongbaiyan Village Economic Cooperatives,
5,390,354 Time of payment is not reached.
Jugezhuang Town, Miyun County
7.26 Other current liability
Unit: Yuan
Item Book balance at the end of term Book balance at the beginning of term
1. Deferred income 12,545,801 12,915,801
Total 12,545,801 12,915,801
The deferred incomes are as follows:
Deferred income Book balance at the end of term Book balance at the beginning of term
Government allowance related to the assets
Fund supporting major construction projects 4,033,000 4,403,000
Special fund for the development of emerging 3,159,227 3,159,227
industries and key industries
Other 5,353,574 5,353,574
Subtotal 12,545,801 12,915,801
7.27 Other non-current liability
Unit: Yuan
Item Book balance at the end of term Book balance at the beginning of term
Employee compensation payable 4,755,794 4,755,794
Deferred income 77,523,141 83,611,041
Total 82,278,935 88,366,835
105
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.27.1 As at June 30, 2014, the employee compensation payable is the guarantee fund for working
responsibility deducted per a certain ratio from the year-end bonuses of employees with the level
above sales manager of the Company, which will pay from 2015 to 2016.
7.27.2 Government allowance
Unit: Yuan
Amount of Amount counted
Balance at the subsidy into
Other Balance at the Relating to
Item of liabilities beginning of newly non-operating
changes end of term assets/earnings
term increased of revenue of this
this term term
Ecological cycle mode
construction of grape high-end 2,520,000 300,000 2,220,000 Relating to earnings
wine culture industrial cluster area
Miyun County Committee
4,444,725 4,444,725 Relating to assets
Propaganda Department Transfer
Grape base project 740,000 370,000 370,000 Relating to assets
Ningxia industrial revitalization
and technical transformation 14,360,000 1,066,500 13,293,500 Relating to assets
project
Industrial revitalization and
21,330,000 1,929,350 19,400,650 Relating to assets
technical transformation project
Grape bulk wine brewing project 10,478,990 717,437 9,761,553 Relating to assets
Special fund for Wuyouyixin
180,000 30,000 150,000 Relating to assets
industrial cluster
Changyu Chateau project 19,818,600 765,000 19,053,600 Relating to assets
Special fund for wine electronic
5,860,527 486,414 5,374,113 Relating to assets
traceability system
Special fund for wine industry
930,000 930,000 Relating to assets
development
Special fund for construction of
10,000,000 500,000 9,500,000 Relating to assets
Peninsula Blue Economic Zone
Scientific research funds subsidy
64,000 3,200 60,800 Relating to assets
of National 863 Plan
Technical transformation project
of information system 5,800,000 290,000 5,510,000 Relating to assets
consutrction engineering
Total 96,526,842 6,457,901 90,068,941 --
Minus: Non-current liabilities due
12,915,801 12,545,801
within one year
Other non-current liabilities 83,611,041 77,523,140
7.28 Share capital
Unit: Yuan
Increase or decrease (+,-)
Share
Beginning sum transferred Ending sum
Issue new
Allocate shares from Other Subtotal
shares
accumulation
fund
Total shares 685,464,000 685,464,000
106
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.29 Capital surplus
Unit: Yuan
Item Beginning sum Increase Decrease Ending sum
Capital premium (Share capital
557,222,454 557,222,454
premium)
Other capital surplus 5,916,588 5,916,588
Total 563,139,042 563,139,042
7.30 Surplus reserve
Unit: Yuan
Item Beginning sum Increase Decrease Ending sum
Legal surplus 342,732,000 342,732,000
Free surplus
Reserve fund
Enterprise expansion fund
Other
Total 342,732,000 342,732,000
In accordance with the Company Law of the Peoples Republic of China and the Articles of Association of
the Company, the Company is required to appropriate 10% of the net profit to the statutory surplus reserve
until the accumulated balance of the statutory surplus reserve reaches 50% of the registered share capital.
The Company can appropriate discretionary surplus reserve after appropriation of the statutory surplus
reserve. Discretionary surplus reserve can be utilized to offset the deficit or increase the share capital after
approval.
7.31 Retained profits
Unit: Yuan
Drawing or distribution
Item Amount
percentage
Retained profits at the end of last year before adjustment 4,616,944,663 --
Total retained profits at the beginning of the year before adjustment (increase listed
--
with+ , and decrease listed with -)
Retained profits at the beginning of the year after adjustment 4,616,944,663 --
Plus: Net profit for owner of the parent company 638,041,311 --
Minus: Drawn legal surplus
Drawn free surplus
Drawn common risk provision
Common dividend payable
107
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Common dividend transferred to share capital
Retained profits at the end of term 5,254,985,974 --
According to the decision of the Shareholders Meeting dated May 23, 2014, based on the issued share
capital of 685,464,000 shares in 2013, the Company allocates RMB 5 Yuan in cash (including tax) for every
10 shares to all shareholders with total cash dividends of RMB 342,732,000 Yuan. Cash dividends had been
issued on July 11, 2014.
7.32 Operating income and costs
7.32.1 Operating income and costs
Unit: Yuan
Item Amount incurred in this term Amount incurred in last term
Major operating income 2,295,163,767 2,534,398,427
Other operating income 6,826,481 4,979,807
Operating cost 754,302,386 759,692,089
7.32.2 Operating income of top 5 clients of the Company
Unit: Yuan
Proportion of total operating income of the
Client Major operating income
Company
Foshan Nanhai District Dali
18,770,871 0.8%
Qianxingrong Wine Shop
Huian County Luocheng Quanxing
14,864,199 0.6%
Famous Wine Commercial Firm
Ruian Xinyu Wine Commercial Firm 13,503,390 0.6%
Nonggongshang Supermarket (Group)
10,807,271 0.5%
Co., Ltd.
Cangnan County Yupin Non-staple
10,379,162 0.5%
Food Business Department
Total 68,324,893 3.0%
7.33 Taxes and surcharges
Unit: Yuan
Amount incurred in this Amount incurred in last
Item Charging standard
term term
Partial brandy is levied at quantity and
price of gross turnover. For all other
Consumption tax 79,962,492 73,055,560
products, the consumption tax is levied at
10% (20%) on taxable revenue.
Business Tax 986,148 1,314,203 Charged at 5% of the turnover
Urban maintenance and construction Charges at 7% of the turnover tax
27,466,029 25,752,918
tax payable
Charged at 3% (5%) of the turnover tax
Education fee and surcharges 14,516,416 19,325,329
payable
Other 9,505,728 4,153,967
108
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Total 132,436,813 123,601,977 --
7.34 Selling expenses
Unit: Yuan
Item Amount incurred in this term Amount incurred in last term
Advertising expenses 262,899,061 343,122,722
Transportation & handling expenses 54,854,637 56,723,169
Trademark usage expenses 43,413,264 46,492,373
Storage expenses 16,033,875 16,924,301
Employee compensation 77,095,386 83,505,523
Travel expenses 9,635,193 9,860,937
Other 22,549,614 27,651,605
Total 486,481,030 584,280,630
7.35 Administrative expenses
Unit: Yuan
Item Amount incurred in this term Amount incurred in last term
Employee compensation 34,965,528 40,198,248
Rental expenses 4,202,779 3,010,207
Depreciation expenses 13,603,951 12,105,187
Amortization expenses 5,312,584 3,337,799
Office expenses 6,430,712 5,987,623
Travel expenses 2,259,499 2,850,278
Business entertainment expenses 1,837,458 1,619,740
Building tax, stamp duty & other taxes 5,769,819 6,017,845
Repair expenses 4,364,445 4,831,854
Contracting expenses 9,231,363 6,401,260
Other 16,002,359 18,536,888
Total 103,980,497 104,896,929
7.36 Financial expenses
Unit: Yuan
Item Amount incurred in this term Amount incurred in last term
Interest expenditure 3,161,233 6,802,656
Minus: Interest income 17,753,946 18,651,366
Plus: Commission charges 224,138 1,401,353
Exchange loss 114,190 -3,159,696
Total -14,254,385 -13,607,053
109
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.37 Non-operation income
7.37.1 Particulars of non-operative income
Unit: Yuan
Amount incurred in Amount incurred in Amount counted into the current
Item
this term last term non-current profits/losses
Total gains on disposal of non-current assets 2,365
Including: Gains on disposal of plant
2,365
property and equipment
Gains on disposal of intangible
assets
Gains on debt recombination
Gains on exchange of non-monetary assets
Grains on donations
Government allowance 8,772,080 4,388,393 8,772,080
Other 672,716 1,284,736 672,716
Total 9,444,796 5,675,494 9,444,796
7.37.2 Government allowance counted into the current profits/losses
Unit: Yuan
Amount incurred in this Amount incurred in last Belonging to non-current
Item of allowance
term term profits/losses or not
Funds to support major projects 4,052,500 2,728,236 Yes
Funds to support small and medium-sized
2,078,674 352,210 Yes
Enterprises
Other 2,640,906 1,307,947 Yes
Total 8,772,080 4,388,393 --
7.38 Non-operation expenses
Unit: Yuan
Amount incurred in this Amount incurred in last Amount counted into the current non-current
Item profits/losses
term term
Total loss on disposal of 10,897 392,956 10,897
non-current assets
Including: Loss on disposal of
10,897 392,956 10,897
fixed assets
Loss on disposal of intangible
assets
Loss on debt recombination
Loss on exchange of non-monetary
assets
Donation 15,000 20,000 15,000
Other 179,619 726,463 179,619
Total 205,516 1,139,419 205,516
110
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.39 Income tax
Unit: Yuan
Item Amount incurred in this term Amount incurred in last term
Current income tax calculated in accordance with the tax law
222,628,228 219,439,114
and relevant regulations
Adjusted deferred income tax -12,386,352 25,036,402
Total 210,241,876 244,475,516
7.40 Computational process based on basic EPS and diluted EPS
Basic EPS is calculated by dividing the net profit for the period attributable to ordinary shareholders
by the weighted average number of ordinary shares outstanding during the period.
Jan.-Jun. 2014 Jan.-Jun. 2013
RMB Yuan RMB Yuan
Earnings
Net profit attributable to ordinary shareholders of the Company 638,041,311 740,574,221
Shares
Weighted average number of ordinary shares outstanding 685,464,000 685,464,000
Basic earnings per share 0.93 1.08
The Company has no dilutive potential ordinary shares.
There are no matters resulting in the changes of ordinary shares or potential ordinary shares
outstanding occurred from the date of balance sheet to the date of approval of this financial
statement.
7.41 Other comprehensive earnings
Unit: Yuan
Item Amount incurred in this term Amount incurred in last term
Converting difference from financial statements in foreign
-269,603
currency
Minus: Net profit or loss in this term transferred from disposal
of overseas operation
Subtotal -269,603
Total -269,603
7.42 Notes to cash flow statement
7.42.1 Cash received relating to other operating activities
Unit: Yuan
Item Amount
Government allowance income 1,815,120
111
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Other 6,533,816
Total 8,348,936
7.42.2 Cash paid relating to other operating activities
Unit: Yuan
Item Amount
Selling expenses 293,202,949
Administrative expenses 35,097,252
Other 5,155,556
Total 333,455,757
7.43 Supplementary information to cash flow statement
7.43.1 Supplementary information to cash flow statement
Unit: Yuan
Supplementary materials Amount incurred in this term Amount incurred in last term
1. Cash flows from operating activities calculated by
-- --
adjusting the net profit:
Net profit 638,041,311 740,574,221
Plus: Provision for impairment of assets
Depreciation of fixed assets, oil-and-gas assets and
66,175,340 62,307,414
productive biological assets
Intangible assets amortization 4,914,237 2,940,030
Amortization of long term prepaid expenses 7,313,656 6,970,257
Losses on disposal of fixed assets, intangible assets and
10,897 390,591
other long-term assets (profit listed with “－”)
Losses on retirement of fixed assets (profit listed with “－”)
Losses on fair value change (profit listed with “－”)
Financial costs (profit listed with “－”) -2,504,848 -11,170,965
Investment losses (profit listed with “－”)
Decrease in deferred income tax assets (increase listed with
-12,386,352 25,036,402
“-”)
Increase of deferred income tax liabilities (decrease listed
with “－”)
Decrease in inventories (increase listed with “-”) 357,764,305 258,147,903
Decrease in operating receivables (increase listed with “-”) -101,390,868 -69,412,601
Increase in operating payable (decrease listed with “-”) -68,262,547 -606,624,763
Other
Net cash flows from operating activities 889,675,131 409,158,489
2. Significant investment and financing activities not
-- --
involving cash deposit and withdrawal:
Debt transferred into assets
Convertible corporate bond mature within 1 year
Fixed assets under financing lease
3. Changes of cash and cash equivalent: -- --
Ending balance of cash 1,605,221,643 1,469,021,755
112
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Supplementary materials Amount incurred in this term Amount incurred in last term
Minus: Opening balance of cash 956,558,932 1,562,294,026
Plus: Ending balance of cash equivalent
Minus: Opening balance of cash equivalent
Net increase amount of cash and cash equivalent 648,662,711 -93,272,271
7.43.2 Cash and cash equivalents
Unit: Yuan
Item Amount incurred in this term Amount incurred in last term
1. Cash 1,605,221,643 956,558,932
Including: Cash on hand 59,735 772,817
Bank deposits on demand 1,605,161,908 955,786,115
Other monetary capital on demand
Due from central bank available for payment
Due from the industry
Inter-bank lending
2. Cash equivalents
Including: Bond investment mature within three months
3. Balance of cash and cash equivalents at the end of term 1,605,221,643 956,558,932
8. Accounting treatment of asset securitization
Nil
9. Related parties and related transactions
9.1 Particulars of the parent company of the Company
Proportion of Proportion
shareholding of voting Final
Name of
Association Type of Registered Legal Business Registered of the parent powers of controlling Organization
parent
relationship enterprise place representative nature capital company in the parent parties of the code
company
this company enterprise
enterprise in this
enterprise
Jointly
controlled by
four parties:
State-owned
Assets
Yantai Supervision
Changyu and
Group Co., Joint Administration
Controlling Yantai
Ltd. stock Sun Liqiang Manufacturing 50,000,000 50.40% 50.40% Commission 265 645 824
shareholder City of Yantai
(“Changyu company
Group Municipal
Company”) Government,
ILLVA
Saronno
Holding SPA,
International
Finance
Corporation
113
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
and Yantai
Yuhua
Investment &
Development
Co., Ltd.
9.2 Particulars of the subsidiaries
Type of Proportion of
Type of Registered Legal Registered Proportion of Organization
Name of the subsidiary the Business nature voting
enterprise place representative capital shareholding code
subsidiary powers
Beijing Changyu Sales and Holding Limited Beijing City,
Sun Jian Sales 1,000,000 100% 100% 634 377 029
Distribution Co., Ltd. subsidiary company China
Yantai City,
Yantai Kylin Packaging Holding Limited
Shandong Yang Ming Manufacturing 15,410,000 100% 100% 863 052 455
Co., Ltd. subsidiary company
Province, China
Yantai City,
Yantai Changyu-Castel Holding Sino-foreign Sun Liqiang USD
Shandong Manufacturing 70% 100% 730 682 613
Wine Chateau Co., Ltd. subsidiary joint venture 5,000,000
Province, China
Xianyang City,
Changyu (Jingyang) Holding Limited
Shaanxi Wei Binsheng Manufacturing 1,000,000 100% 100% 732 663 643
Pioneer Wine Co., Ltd. subsidiary company
Province, China
Yantai City,
Yantai Changyu Pioneer Holding Limited
Shandong Jiang Hua Sales 8,000,000 100% 100% 746 576 380
Wine Sales Co., Ltd. subsidiary company
Province, China
Langfang Development Langfang City,
Holding Sino-foreign USD
Zone Castel-Changyu Hebei Province, Alan. Castel Manufacturing 49% 100% 735 624 56X
Wine Co., Ltd.
subsidiary joint venture 6,108,818
China
Changyu (Jingyang) Xianyang City,
Holding Limited
Pioneer Wine Sales Co., Shaanxi Wei Binsheng Sales 1,000,000 100% 100% 735 379 154
Ltd. subsidiary company
Province, China
Langfang Changyu Langfang City,
Holding Limited
Pioneer Wine Sales Hebei Province, Liu Wanqiang Sales 1,000,000 100% 100% 737 388 150
Co.,Ltd.
subsidiary company China
Shanghai Changyu Sales Holding Limited Shanghai City, Zhou
Sales 1,000,000 100% 100% 749 571 075
and Distribution Co., Ltd. subsidiary company China Hongjiang
Beijing Changyu AFIP Miyun County,
Holding Limited Sun Hongbo
Eco-agriculture Beijing City, Sales 1,000,000 100% 100% 585 851 395
subsidiary company
Development Co., Ltd. China
Beijing Changyu AFIP Holding Limited Beijing City,
Sun Liqiang Manufacturing 110,000,000 70% 100% 780 953 469
Wine Chateau Co., Ltd. subsidiary company China
Yantai City,
Yantai Changyu Wine Holding Limited
Shandong Jiang Hua Sales 5,000,000 100% 100% 783 487 627
Sales Co., Ltd. subsidiary company
Province, China
Yantai City,
Yantai Changyu Pioneer Holding Limited Zhou
Shandong Sales 5,000,000 100% 100% 780 766 161
International Co., Ltd. subsidiary company Hongjiang
Province, China
Hangzhou City,
Hangzhou Changyu Wine Holding Limited Jiang Hua
Zhejiang Sales 500,000 100% 100% 788 283 631
Sales Co., Ltd. subsidiary company
Province, China
Yinchuan City,
Ningxia Changyu Holding Limited Ningxia Hui Shao
Grape-Growing Co., Ltd.
Planting 1,000,000 100% 100% 788 200 410
subsidiary company Autonomous Chunsheng
Region, China
Huanren Changyu Benxi City,
Holding Limited Leng Bin
National Wine Sales Co., Liaoning Sales 2,000,000 100% 100% 794 822 179
Ltd.
subsidiary company
Province, China
Benxi City,
Liaoning Changyu Ice Holding Sino-foreign Zhou
Wine Chateau Co., Ltd.
Liaoning Manufacturing 26,300,000 51% 100% 747 128 301
subsidiary joint venture Hongjiang
Province, China
Yantai City,
Yantai Development Zone Holding Limited Zhou
Shandong Sales 5,000,000 100% 100% 796 183 411
Changyu Trade Co., Ltd. subsidiary company Hongjiang
Province, China
Shenzhen Changyu Wine Holding Limited Shenzhen City, Lin Pu Sales 500,000 100% 100% 664 195 20X
114
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Type of Proportion of
Type of Registered Legal Registered Proportion of Organization
Name of the subsidiary the Business nature voting
enterprise place representative capital shareholding code
subsidiary powers
Marketing Ltd. subsidiary company Guangdong
Province, China
Yantai Fushan District Yantai City,
Holding Limited Zhou
Changyu Trading Co., Shandong Sales 5,000,000 100% 100% 660 176 044
subsidiary company Hongjiang
Ltd. Province, China
Miyun County,
Beijing AFIP Meeting Holding Limited Sun Hongbo
Beijing City, Service 500,000 100% 100% 669 926 112
Center Co., Ltd. subsidiary company
China
Miyun County,
Beijing AFIP Tourism and Holding Limited Liu Shilu
Beijing City, Tourism 500,000 70% 100% 676 627 372
Culture Co., Ltd. subsidiary company
China
Yinchuan City,
Ningxia Changyu Holding Limited Ningxia Hui Li Jiming
Pioneer Wine Co., Ltd.
Manufacturing 1,000,000 100% 100% 670 408 275
subsidiary company Autonomous
Region, China
Yantai City,
Yantai Changyu Tinlot Holding Limited Wholesale and
Shandong Liu Quan 80,000,000 100% 100% 683 222 859
Chateau Co., Ltd. subsidiary company retail
Province, China
Qingtongxia
City, Ningxia
Qing Tong Xia Changyu Holding Limited
Hui Liu Yuquan Sales 500,000 100% 100% 694 334 151
Wine Marketing Ltd. subsidiary company
Autonomous
Region, China
Shihezi City,
Xinjiang Changyu Baron Holding Limited Xinjiang Uygur Sun Liqiang
Manufacturing 150,000,000 100% 100% 552 414 949
Balboa Chateau Co., Ltd. subsidiary company Autonomous
Region, China
Yinchuan City,
Ningxia Changyu Mosel Holding Limited Ningxia Hui Zhou
Manufacturing 2,000,000 100% 100% 694 349 740
XV Chateau Co., Ltd. subsidiary company Autonomous Hongjiang
Region, China
Xianyang City,
Shaanxi Changyu Ruina Holding Limited Sun Liqiang
Shaanxi Manufacturing 20,000,000 100% 100% 552 180 142
Chateau Co., Ltd. subsidiary company
Province, China
Yantai Changyu Wine Yantai City,
Holding Limited Sun Liqiang
Research and Shandong Manufacturing 500,000,000 100% 100% 555 235 76X
Development Co., Ltd.
subsidiary company
Province, China
Benxi City, Preparation for
Changyu (Huanren) Holding Limited Zhou
Liaoning wine-making 5,000,000 100% 100% 587 310 365
Wine Co., Ltd. subsidiary company Hongjiang
project
Province, China
Shihezi City,
Xinjiang Changyu Wine Holding Limited Xinjiang Uygur Lin Pu
Sales 10,000,000 100% 100% 580 208 296
Sales Co., Ltd. subsidiary company Autonomous
Region, China
Shihezi City,
Xinjiang Changyu Wine Holding Limited Xinjiang Uygur Lin Pu
Manufacturing 10,000,000 100% 100% 580 222 610
Co., Ltd. subsidiary company Autonomous
Region, China
Yinchuan City,
Ningxia Changyu Holding Limited Ningxia Hui Zhou
Sales 1,000,000 100% 100% 054 609 428
Trading Co., Ltd. subsidiary company Autonomous Hongjiang
Region, China
Shaanxi Changyu Xianyang City,
Holding Limited Sun Liqiang
Ruina Wine Sales Co., Shaanxi Sales 3,000,000 100% 100% 056 906 215
subsidiary company
Ltd. Province, China
Penglai City,
Penglai Changyu Wine Holding Limited Leng Bin
Shandong Sales 5,000,000 100% 100% 053 429 070
Sales Co., Ltd. subsidiary company
Province, China
Laizhou City,
Laizhou Changyu Wine Holding Limited Leng Bin
Shandong Sales 1,000,000 100% 100% 07440641-7
Sales Co., Ltd. subsidiary company
Province, China
Shihezi City,
Xinjiang Tianzhu Wine Holding Limited Xinjiang Uygur Zhou
Manufacturing 75,000,000 60% 100% 787 604 261
Co., Ltd. subsidiary company Autonomous Hongjiang
Region, China
115
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Type of Proportion of
Type of Registered Legal Registered Proportion of Organization
Name of the subsidiary the Business nature voting
enterprise place representative capital shareholding code
subsidiary powers
Etablissements Holding Zhou EUR
Cognac, France Trading 100% 100% N/A
RoulletFransac subsidiary Hongjiang 2,896,531
Beijing Changyu Trading Holding Limited Beijing City, Pan Jianfu
Co., Ltd.
Sales 500,000 100% 100% 098 908 809
subsidiary company China
Tianjin Changyu Pioneer Holding Limited Tianjin City, Li Haiping
Wine Sales Co., Ltd.
Sales 500,000 100% 100% 08301099-1
subsidiary company China
Fuzhou City,
Fuzhou Changyu Pioneer Holding Limited
Wine Co., Ltd.
Fujian Province, Sun Guiyang Sales 500,000 100% 100% 07976834-5
subsidiary company
China
Nanjing City,
Nanjing Changyu Pioneer Holding Limited Zhang Fuqian Sales
Wine Co., Ltd.
Jiangsu 500,000 100% 100% 08416861-9
subsidiary company
Province, China
Xianyang City,
Xianyang Changyu Pioneer Holding Limited Wei Binsheng Sales
Drinks Sales Co., Ltd.
Shaanxi 500,000 100% 100% 08818837-7
subsidiary company
Province, China
Shenyang City,
Shenyang Changyu Pioneer Holding Limited Xiao Yongjie
Wine Co., Ltd.
Liaoning Sales 500,000 100% 100% 09789141-9
subsidiary company
Province, China
Jinan City,
Jinan Changyu Pioneer Holding Limited Li Yingjun
Drinks Co., Ltd.
Shandong Sales 500,000 100% 100% 07617957-x
subsidiary company
Province, China
Shanghai Changyu Pioneer Holding Limited Shanghai City, Zhai Deqiang Sales
Wine Co., Ltd.
500,000 100% 100% 08209497-8
subsidiary company China
Fuzhou City,
Fuzhou Changyu Pioneer Holding Limited Li Shoukun
Wine Co., Ltd.
Jiangxi Sales 500,000 100% 100% 07903537-9
subsidiary company
Province, China
Shijiazhuang
Shijiazhuang Changyu Holding Limited Yi Longhai
Pioneer Wine Sales Co., Ltd. subsidiary company
City, Hebei Sales 500,000 100% 100% 08131179-0
Province, China
Hangzhou City,
Hangzhou Yuzefeng Trading Holding Limited Xiao Zhenbo
Co., Ltd.
Zhejiang Sales 500,000 100% 100% 09760041-5
subsidiary company
Province, China
Changchun
Jilin Province Changyu Holding Limited Wang Bo
Pioneer Wine Co., Ltd.
City, Jilin Sales 500,000 100% 100% 07364313-8
subsidiary company
Province, China
Beijing Changyu Pioneer Holding Limited Beijing City, Pan Jianfu
Wine Sales Co., Ltd.
Sales 500,000 100% 100% 06125269-0
subsidiary company China
Harbin City,
Harbin Changyu Pioneer Holding Limited Tan Jun
Wine Sales Co., Ltd.
Heilongjiang Sales 500,000 100% 100% 30082468-5
subsidiary company
Province, China
Changsha City,
Hunan Changyu Pioneer Holding Limited Sun Junming
Wine Co., Ltd.
Hunan Sales 2,000,000 100% 100% 09446465-7
subsidiary company
Province, China
Yinchuan City,
Yinchuan Changyu Pioneer Holding Limited Ningxia Hui Ruan Shili
Wine Co., Ltd. Autonomous
Sales 500,000 100% 100% 07384874-X
subsidiary company
Region, China
Kunming City,
Kunming Changyu Pioneer Holding Limited Ma Long
Wine Co., Ltd.
Yunnan Sales 500,000 100% 100% 08042997-3
subsidiary company
Province, China
9.3 Other related parties of the Company
Name of other related parties Relationship with the Company Organization code
Yantai Changyu Wine Culture Museum Company controlled by the same parent
258 258 654
Co., Ltd. company
Yantai Changyu International Window of Company controlled by the same parent
672 208 146
the Wine City Company Limited company
Company controlled by the same parent
Yantai Shenma Packaging Co., Ltd. 553 393 350
company
116
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Yantai Zhongya Pharmaceutical Tonic Company controlled by the same parent
726 203 923
Wine Co., Ltd. company
9.4 Transactions with related parties
9.4.1 List of purchasing goods and receiving services from related parties
Unit: Yuan
Amount incurred in this term Amount incurred in last term
Method of procedure of Percentage in
Related parties Transactions pricing of the similar Percentage in similar
transactions Amount Amount
transaction transaction amount
amount
Yantai Changyu Wine
Purchasing
Culture Museum Co., Negotiated price 2,536,312 0.34% 91,691 0.01%
goods
Ltd.
Yantai Changyu
International Window Purchasing
Negotiated price 269,090 0.04% 506 0.00%
of the Wine City goods
Company Limited
Yantai Shenma Purchasing
Negotiated price 60,982,785 8.08% 114,796,337 15.11%
Packaging Co., Ltd. goods
Yantai Zhongya
Purchasing
Pharmaceutical Tonic Negotiated price 1,176,307 0.16% 5,685,223 0.75%
goods
Wine Co., Ltd.
List of selling goods and providing services to related parties
Unit: Yuan
Amount incurred in this term Amount incurred in last term
Method of procedure
Related parties Transactions of pricing of the Percentage in Percentage in
transactions Amount similar transaction Amount similar transaction
amount amount
Yantai Changyu Wine Culture Selling
Negotiated price 3,426,136 0.15% 1,573,313 0.06%
Museum Co., Ltd. goods
Yantai Changyu International
Selling
Window of the Wine City Negotiated price 4,349,779 0.19% 2,292,885 0.09%
goods
Company Limited
Yantai Zhongya
Selling
Pharmaceutical Tonic Wine Negotiated price 427,973 0.02% 725,827 0.03%
goods
Co., Ltd.
9.4.2 Related lease
Leasing list of the Company
Unit: Yuan
Type of the leased Beginning Basis for lease Confirmed lease fee
Name of the lessor Name of the lessee Ending date
property date fee in this term
Yantai Changyu Yantai Changyu Warehouse and January 1, December 31, Negotiated
2,929,000
Group Co., Ltd. Wine Co., Ltd. office building 2012 2016 price
Pursuant to a lease contract signed between the Company and the Changyu Group Company,
117
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
starting from January 1, 2012, the Company may rent properties for operation purposes at a basic
annual rental of RMB 5,858,000 Yuan, and the expired date is December 31, 2016. From January to
June 2014, the rental expenses payable of the Group to the controlling company amounted to RMB
2,929,000 Yuan.
From January to June 2014, the rental expenses of the Group and the related parties accounted for
28.25% of the Group.
9.4.3 Other related party transactions
Item Note Amount incurred in this term Amount incurred in last term
Trademark usage (a) 43,413,264 46,492,373
fee
Patents fee (b) 25,000 25,000
All related party transactions are based on the negotiated price.
a. Trademark royalty contract
Pursuant to a trademark royalty contract dated May 18, 1997 signed by the Company and the
Changyu Group Company, starting from September 18, 1997, the Company may use certain
trademark of Changyu Group Company, which has been registered with the PRC Trademark Office.
An annual royalty fee at 2% of the Groups annual sales is payable to Changyu Group Company.
The license is effective until the expiry of the registration of the trademarks.
From January to June 2014, patent fee paid to related parties accounted for 100% of the Group.
b. Patent implementation license
Pursuant to a patent implementation license dated May 18, 1997 signed by the Company and the
Changyu Group Company, starting from September 18, 1997, the Company may use the patents of
Changyu Group Company. The annual patents usage fee payable by the Company to Changyu
Group Company was RMB 50,000 Yuan. The contract was expired on December 20, 2005. The
Company renewed the contract on August 20, 2006 for 10 years. The annual patents usage fee
payable by the Company to Changyu Group Company remained RMB 50,000 Yuan. From January
to June 2014, the patents usage fee payable to Changyu Group Company amounted to RMB 25,000
Yuan.
From January to June 2014, patent fee paid to related parties accounted for 100% of the Group.
9.5 Accounts receivable and payable of the related parties
Accounts receivable from related parties by listed companies
Unit: Yuan
Ending sum Beginning sum
Item Related parties Book Bad debt Bad debt
Book balance
balance provision provision
Yantai Changyu Wine Culture Museum
Accounts receivable 53,114
Co., Ltd.
118
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Yantai Changyu International Window of
Accounts receivable 42,478
the Wine City Company Limited
Accounts receivable Yantai Shenma Packaging Co., Ltd. 911,197
Yantai Zhongya Pharmaceutical Tonic
Accounts receivable 2,567,129
Wine Co., Ltd.
Other accounts
Changyu Group Company 2,954,000
receivable
Payable to related parties by listed companies
Unit: Yuan
Item Related parties Ending sum Beginning sum
Accounts payable Yantai Shenma Packaging Co., Ltd. 30,898,290 46,370,178
Yantai Zhongya Pharmaceutical Tonic Wine
Accounts payable 2,186,684 4,520,101
Co., Ltd.
Yantai Changyu Wine Culture Museum
Accounts payable 177,526
Co., Ltd.
Yantai Changyu International Window of
Accounts payable 7,772
the Wine City Company Limited
Other accounts payable Changyu Group Company 43,413,264 78,986,198
Other accounts payable Yantai Shenma Packaging Co., Ltd. 165,230
Yantai Zhongya Pharmaceutical Tonic Wine
Other accounts payable 52,760
Co., Ltd.
10. Share payment
Nil
11. Contingency
11.1 Contingent liability caused by pending litigation and arbitration and financial influence
Nil
11.2 Contingent liability caused by providing debt guarantee for other units and financial
influence
Nil
12. Commitment
12.1 Significant commitment
End balance Beginning balance
Capital commitment 725,600,000 1,253,880,000
13. Matters after balance sheet
13.1 Important matters after balance sheet
Nil
119
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
13.2 Distribution of profits after balance sheet
Unit: Yuan
Profits or dividends to be distributed 342,732,000
Allocated profits or dividends approved to declare upon
342,732,000
discussion
According to the decision of the Shareholders Meeting dated May 23, 2014, based on the issued share
capital of 685,464,000 shares in 2013, the Company allocates RMB 5 Yuan in cash (including tax) for every
10 shares to all shareholders with total cash dividends of RMB 342,732,000 Yuan. Cash dividends had been
issued on July 11, 2014.
14. Other important matters
Nil
15. Notes to financial statements of the parent company
15.1 Accounts receivable
15.1.1 Accounts receivable
Unit: Yuan
Ending sum Beginning sum
Type Book balance Bad debt provision Book balance Bad debt provision
Amount Proportion Amount Proportion Amount Proportion Amount Proportion
Accounts receivable of significant
single amount and single accrued bad
debt provision
Accounts receivable of insignificant
single amount and single accrued bad 1,600,968 100%
debt provision
Total -- -- 1,600,968 -- --
15.1.2 Accounts receivable transferred back or received in this term
Nil
15.1.3 Accounts receivable actually cancelled after verification in this term
Nil
15.1.4 Accounts receivable due from shareholders with voting rights of 5% (including 5%) or above
in this term
Nil
120
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
15.2 Other accounts receivable
15.2.1 Other accounts receivable
Unit: Yuan
Ending sum Beginning sum
Type Book balance Bad debt provision Book balance Bad debt provision
Amount Proportion Amount Proportion Amount Proportion Amount Proportion
Accounts receivable of
significant single amount
3,359,650,606 99.3% 7,392,429 0.22% 3,683,374,031 99.1% 7,392,429 0.20%
and single accrued bad
debt provision
Accounts receivable of
insignificant single amount
22,245,695 0.7% 33,602,347 0.9%
and single accrued bad
debt provision
Total 3,381,896,301 -- 7,392,429 -- 3,716,976,378 -- 7,392,429 --
Other accounts receivable of significant single amount and single accrued bad debt provision at the
end of term
Unit: Yuan
Other accounts
Book balance Bad debt Accrued proportion (%) Reason
receivable
Tiantong Securities Co., This company is in
7,392,429 7,392,429 100%
Ltd. bankruptcy liquidation
Total 7,392,429 7,392,429 -- --
15.2.2 Other accounts receivable transferred back or received in this term
Nil
15.2.3 Other accounts receivable actually cancelled after verification in this term
Nil
15.2.4 Other accounts receivable due from shareholders with voting rights of 5% (including 5%) or
above in this term
Unit: Yuan
Ending sum Beginning sum
Unit
Book balance Accrued bad debt Book balance Accrued bad debt
Yantai Changyu Group Co., Ltd. 2,954,000
Total 2,954,000
15.2.5 Nature or content of other accounts receivable of significant amount
Unit: Yuan
Unit Amount Nature or content of fund Percentage of total other accounts receivable (%)
Xinjiang Changyu Baron Balboa Chateau Co., Ltd. 602,410,603 Incomings and outgoings 17.8%
121
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Shaanxi Changyu Ruina Wine Sales Co., Ltd. 664,192,357 Incomings and outgoings 19.6%
Beijing Changyu AFIP Wine Chateau Co., Ltd. 535,382,294 Incomings and outgoings 15.8%
Ningxia Changyu Mosel XV Chateau Co., Ltd. 370,804,000 Incomings and outgoings 11.0%
Yantai Changyu Wine Research and Development Co., Ltd. 284,188,000 Incomings and outgoings 8.4%
Total 2,456,977,254 -- 72.6%
15.2.6 Top 5 units of other accounts receivable
Unit: Yuan
Relationship with the Percentage of total other accounts
Unit Amount Period
Company receivable
Within 1
Xinjiang Changyu Baron Balboa Chateau Co., Ltd. 602,410,603 17.8%
Subsidiary year
Within 1
Shaanxi Changyu Ruina Wine Sales Co., Ltd. 664,192,357 19.6%
Subsidiary year
Within 1
Beijing Changyu AFIP Wine Chateau Co., Ltd. 535,382,294 15.8%
Subsidiary year
Within 1
Ningxia Changyu Mosel XV Chateau Co., Ltd. 370,804,000 11.0%
Subsidiary year
Yantai Changyu Wine Research and Development Co., Within 1
284,188,000 8.4%
Ltd. Subsidiary year
Total -- 2,456,977,254 -- 72.6%
122
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
15.3 Long-term equity investment
Unit: Yuan
Explanation for
Proportion of difference between
Proportion of voting power the proportion of Accrued
Calculation Cost of Beginning Movement Impairment Cash
Invest to Ending balance shareholding in in the shareholding and depreciation
method investment balance for the year provision dividend
the invested unit invested unit proportion of provision
(%) voting power in the
invested unit
Xinjiang Tianzhu (a) Cost
60,000,000 60,000,000 60,000,000 60% 100%
method
Kylin Packaging Cost
23,176,063 23,176,063 23,176,063 100% 100%
method
Changyu Chateau (a) Cost
28,968,100 28,968,100 28,968,100 70% 100%
method
AFIP Tourism Cost
350,000 350,000 350,000 70% 100%
method
Pioneer International Cost
3,500,000 3,500,000 3,500,000 70% 100%
method
Ningxia Growing Cost
1,000,000 1,000,000 1,000,000 100% 100%
method
National Wines Cost
2,000,000 2,000,000 2,000,000 100% 100% 10,000,000
method
Ice Chateau (a) Cost
30,440,500 30,440,500 30,440,500 51% 100%
method
Beijing Chateau (a) Cost 77,000,000 77,000,000 77,000,000 70% 100%
method
Sales Company Cost 7,200,000 7,200,000 7,200,000 90% 100%
method
Langfang Sales (b) Cost
100,000 100,000 100,000 10% 100% 474,283
method
123
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Langfang Castel Cost
19,835,730 19,835,730 19,835,730 39% 100%
method
Wine Sales Cost 4,500,000 4,500,000 4,500,000 90% 100% 40,000,000
method
Shanghai Sales (b) Cost
300,000 300,000 300,000 30% 100%
method
Beijing Sales Cost
850,000 850,000 850,000 100% 100%
method
Jingyang Sales (b) Cost
100,000 100,000 100,000 10% 100% 15,000,000
method
Jingyang Wine Cost
900,000 900,000 900,000 90% 100%
method
Ningxia Wine Cost
1,000,000 1,000,000 1,000,000 100% 100%
method
Ningxia Chateau Cost
2,000,000 2,000,000 2,000,000 100% 100%
method
Tinlot Chateau Cost
80,000,000 80,000,000 80,000,000 100% 100%
method
Shihezi Chateau Cost
150,000,000 150,000,000 150,000,000 100% 100%
method
Changan Chateau Cost
20,000,000 20,000,000 20,000,000 100% 100%
method
Development Centre Cost
500,000,000 500,000,000 500,000,000 100% 100%
method
Huanren Wine Cost
5,000,000 5,000,000 5,000,000 100% 100%
method
Yantai Dingtao Cost
10,000,000 10,000,000 10,000,000 18% 18% 10,000,000
method
France Trading Cost
29,988,530 29,988,530 29,988,530 100% 100%
method
Total -- 1,058,208,923 1,058,208,923 1,058,208,923 -- -- -- 10,000,000 65,474,283
124
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
(a) The Company holds 100% of the voting power and interests of those are not wholly-owned
subsidiaries by contracted operation and paying contracting fees. Refer to Notes 6.1.
(b) The Company holds 100% of the voting power of those subsidiaries by indirect holding.
From January to June 2014, there was no significant restriction on the remittance of fund from the
invested units to the Company.
15.4 Operating income and cost
15.4.1 Operating income
Unit: Yuan
Item Amount incurred in this term Amount incurred in last term
Major operating income 684,914,588 687,497,638
Other operating income 4,982,691 27,585,498
Total 689,897,279 715,083,136
Operating cost 565,744,989 585,109,268
15.4.2 Operating income of top 5 clients of the Company
Unit: Yuan
Proportion of total operating income of the
Client Total operating income
Company
Sales Company 624,864,715 90.6%
Penglai Wine 19,640,021 2.8%
Jingyang Wine 13,546,330 2.0%
Langfang Castel 11,789,340 1.7%
Laizhou Sales 9,645,837 1.4%
Total 679,486,243 98.5%
15.5 Investment income
15.5.1 Particulars of investment income
Unit: Yuan
Item Amount incurred in this term Amount incurred in last term
125
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Income from long-term equity investment by cost method 65,474,283 11,140,442
Income from long-term equity investment by equity method
Income from disposal of long-term equity investment
Investment income gained from disposal of financial assets held
for trading
Investment income gained from held-to-maturity investment in the
beneficial period
Investment income gained from financial assets held for sale
Investment income gained from disposal of trading financial
assets
Investment income gained from held-to-maturity investment
Income from investment in financial assets for sale
Other
Total 65,474,283 11,140,442
15.5.2 Income on long-term equity investment by cost method
Unit: Yuan
Invest to Amount incurred in this term Amount incurred in last term Reason for change in this term
National Wines 10,000,000
Langfang Sales 474,283
Wine Sales 40,000,000 11,140,442
Jingyang Sales 15,000,000
Total 65,474,283 11,140,442 --
15.6 Supplementary information to consolidated cash flow statement
Unit: Yuan
Amount incurred in this Amount incurred in last
Supplementary materials
term term
1. Cash flows from operating activities calculated by adjusting the net profit: -- --
Net profit 73,738,325 28,904,179
Plus: Provision for impairment of assets
Depreciation of fixed assets, oil-and-gas assets and productive biological
19,048,033 19,808,610
assets
Intangible assets amortization 1,186,538 1,121,540
Amortization of long term prepaid expenses
126
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Amount incurred in this Amount incurred in last
Supplementary materials
term term
Losses on disposal of fixed assets, intangible assets and other long-term
1,106
assets (profit listed with “－”)
Losses on retirement of fixed assets (profit listed with “－”)
Losses on fair value change (profit listed with “－”)
Financial costs (profit listed with “－”) -2,504,848 -11,170,965
Investment losses (profit listed with “－”) -65,474,283 -11,140,442
Decrease in deferred income tax assets (increase listed with “-”) 4,562,647 5,809,621
Increase of deferred income tax liabilities (decrease listed with “－”)
Decrease in inventories (increase listed with “-”) 99,370,116 110,238,935
Decrease in operating receivables (increase listed with “-”) 241,549,926 -208,855,353
Increase in operating payable (decrease listed with “-”) -169,871,438 543,489,465
Other
Net cash flows from operating activities 201,605,016 478,206,696
2. Significant investment and financing activities not involving cash deposit
-- --
and withdrawal:
Debt transferred into assets
Convertible corporate bond mature within 1 year
Fixed assets under financing lease
3. Changes of cash and cash equivalent: -- --
Ending balance of cash 619,101,335 833,162,361
Minus: Opening balance of cash 197,150,989 425,084,049
Plus: Ending balance of cash equivalent
Minus: Opening balance of cash equivalent
Net increase amount of cash and cash equivalent 421,950,346 408,078,312
16. Supplementary materials
16.1 List of current non-current profits/losses
Unit: Yuan
Item Amount Remark
Profits/losses on disposal of non-current assets (including
-10,897
write-off amount accrued provision for impairment of assets)
Tax return, deduction and exemption approved beyond the
0
authority or without formal approval document
127
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Amount Remark
Government allowance included in the current profits/losses
(excluding those closely related to the enterprise business and
8,772,080
enjoyed in accordance with the unified standard quota or ration of
the state)
Payment for use of funds by non-financial enterprises included in
the current profits/losses
Income obtained when the investment cost obtained by the
enterprise from subsidiaries, associated enterprises and
cooperative enterprises is less than the fair value of the net
identifiable assets obtained from the invested units when the
investment is made
Profits/losses on exchange of non-monetary assets
Profits/losses on entrusting other people to make investment or
manage assets
Asset impairment provision accrued due to force majeure such as
natural disaster
Profits/losses on debt restructuring
Enterprise reorganization expenses such as staffing expenditure
and integration expenses
Profits/losses on those beyond the fair value generated from
transactions with unfair transaction price
Current net profits/losses on subsidiaries acquired from a business
combination under common control from the beginning to the
consolidation date
Profits/losses on contingencies irrelated to the normal business of
the Company
Profits/losses on changes of fair value of financial assets and
liabilities held for trading, and investment income from disposal
of financial assets and liabilities held for trading and financial
assets held for sale, excluding effective hedging operations
relevant to the normal business of the Company
Returns of provision for impairment of accounts receivable with
single impairment test
Profits/losses on external entrusted loans
Profits/losses on fair value changes of investment real estate with
fair value mode for follow-up measurement
Influence of the one-time adjustment of the current profits/losses
in accordance with tax and accounting laws and regulations on
128
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Amount Remark
the current profits/losses
Trustee fee income from entrusted operation
Other non-operating income and expenditure besides the above
478,097
items
Other profits/losses conforming to the definition of non-current
profits/losses
Minus: Influenced amount of income tax 1,098,823
Influenced amount of minority shareholders equity (after-tax)
Total 8,140,457 --
16.2 Accounting data difference under domestic and foreign accounting standard
16.2.1 Net profits & net assets difference disclosed in the financial report according to the
international accounting standard and Chinese accounting standard
Unit: Yuan
Net profits belonging to shareholders of listed Net assets belonging to shareholders of listed
companies companies
Amount in this term Amount in last term End sum Beginning sum
In accordance with the
638,041,311 740,574,221 6,846,051,413 6,208,279,705
Chinese accounting standard
Item & amount adjusted in accordance with the international accounting standard
In accordance with the
international accounting 638,041,311 740,574,221 6,846,051,413 6,208,279,705
standard
16.3 Return on net assets and earnings of per share
Unit: Yuan
Weighted average return on net Earnings per share
Profit incurred in this term
assets Basic EPS Diluted EPS
Net profit attributable to common shareholders
9.77% 0.93 0.93
of the Company
Net profit attributable to common shareholders
of the Company deducting non-incidental 9.65% 0.92 0.92
profits/(losses)
129
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
16.4 Abnormalities in main accounting statements of the Company and reason
Beginning More or
Assets and liabilities Ending balance Reason for changes
balance less (%)
Mainly because of the reducing of monetary capital for
Monetary capital 1,861,541,927 1,367,818,182 36.10%
operation and investment activities
Mainly because of the increasing of received
Notes receivable 270,389,669 79,702,753 239.25%
bankers acceptance
Mainly because of the settlement with suppliers after receiving
Prepayment 12,631,073 45,997,863 -72.54%
goods.
Mainly because of the stock decreasing due to the distribution
Inventory 1,763,353,132 2,121,117,437 -16.87%
during the spring festival
Advance Payment 297,711,405 188,651,254 57.81% Mainly because of the increasing of customers prepayment
Taxes payable 63,377,377 194,413,430 -67.40% Mainly because of paying the income tax of last year
Profit and cash flow Amount in the Amount in last More or
Reason for changes
statement period period less (%)
The decrease of sales revenue for the high-end wine,
Operating income 2,301,990,248 2,539,378,234 -9.35%
comparing with the same period of last year.
The changes of sales products structure, the proportion of
high-end products declining, the proportion of low quality
Operating cost 754,302,386 759,692,089 -0.71%
products increasing, the increasing of raw material including
grapes
According to the market situation, appropriately compressing
Sales expense 486,481,030 584,280,630 -16.74%
marketing investment
The decrease of net profit, comparing with the same period of
Income tax expense 210,241,876 244,475,516 -14.00%
last year.
Net cash flows from It is mainly because that the cash outflows in each operating
889,675,131 409,158,489 117.44%
operating activities activity are reduced.
Net cash flows from It is mainly because that the cash paid for purchasing the fixed
-240,974,464 -502,430,760 52.04%
investing activities deposit with the term of over 3 months are reduced.
Net increase amount
It is mainly because that the net cash flows from operating
of cash and cash 648,662,711 -93,272,271 795.45%
activities and investing activities are increased.
equivalent
130
Full Text of 2014 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
X、Catalogue of Documents for Future Reference
1、Semi-annual reports signed by the president;
2、Financial reports signed and affixed the seal by the president, financial administrator in
charge of accounting and chief of accounting department;
3、All documents published on the newspaper designated by China Securities Regulatory
Commission in the reporting term;
4、Articles of Association;
5、Other relevant documents.
Yantai Changyu Pioneer Wine Company Limited
Board of Director
27th August, 2014
131
