2014 Annual Report Abstract of Yantai Changyu Pioneer Wine Co. Ltd.
Shares Code: 000869. 200869 Shares Abbreviation: Changyu A、Changyu B Notice No.: 2015-Final01
Yantai Changyu Pioneer Wine Co. Ltd.
2014 Annual Report Abstract
This Annual Report abstract comes from the whole contents of annual report. If
investors desire to comprehend more details，please read the Annual Report carefully.
The Annual Report has been published in not only the website of Shenzhen Stock
Exchange but also other websites stipulated by the China Securities Regulatory
Commission.
1. Important Warning
Brief Introduction for the Company
Abbreviation of Code number of
Changyu A、Changyu B 000869、200869
the Shares: the Shares
Place of listing of
Shenzhen Stock Exchange
the Shares
Abbreviation of
the Shares after -
alteration (if have)
Contact person Secretary to the Board of Authorized Representative
and information Directors of the Securities Affairs
Name Mr. Qu Weimin Mr. Li Tingguo
Tel 0086-535-6633656 0086-535-6633656
Fax 0086-535-6633639 0086-535-6633639
E-mail quwm@changyu.com.cn stock@changyu.com.cn
2. Changes in Key Financial Data and Shareholders
(1)Key financial data
2014 Annual Report Abstract of Yantai Changyu Pioneer Wine Co. Ltd.
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
Unit：CNY
More or less
Item 2014 2013 than 2012
Last year (%)
Business revenue 4,156,727,525.00 4,320,948,572.00 -3.80% 5,643,530,553.00
Net profit attributed to the
shareholders of the listed 977,707,711.00 1,048,185,927.00 -6.72% 1,700,928,117.00
company
Net profit attributed to the
shareholders of the listed
company after deducting 950,191,379.00 1,017,348,285.00 -6.60% 1,675,956,428.00
the irregular profit and
loss
Net cash flows from the
1,070,083,296.00 735,074,307.00 45.57% 1,302,041,322.00
operating activities
Basic earnings per share 1.43 1.53 -6.54% 2.48
Diluted earnings per share 1.43 1.53 -6.54% 2.48
Weighted average for
earning rate of the net 13.96% 16.45% -2.49% 31.13%
assets
More or less
Dec. 31st 2014 Dec. 31st 2013 than Dec. 31st 2012
Last year (%)
Total assets 8,912,232,640.00 7,997,930,542.00 11.43% 8,123,134,580.00
Net Assets attributed to
the shareholders of the 6,840,452,145.00 6,208,279,705.00 10.18% 5,913,104,178.00
listed company
2014 Annual Report Abstract of Yantai Changyu Pioneer Wine Co. Ltd.
(2) Situation of shares held by top ten common shareholders
43,151, 43593, including 29,146 A
including 28,531 Total number of common shareholders and 14447 B
shareholders until the end of shareholders
Total shareholders in the report
A shareholders the 5th trading days before the
period
disclosure day of the annual
and 14620 report
B shareholders
Number Pledged or frozen
Character of Percentage Shares held until the end of
Name of Shareholders
shareholders (%) of the report period restricted Share Amount
shares status
Domestic
YANTAI CHANGYU GROUP CO.
non-state-owned 50.4% 345,473,856 0 0 0
LTD.
legal person
GAOLING FUND,L.P. Foreign shareholder 3.53% 24,176,997 0 0 0
BBH BOS S/A FIDELITY FD -
Foreign shareholder 2.35% 16,106,326 0 0 0
CHINA FOCUS FD
GIC PRIVATE LIMITED Foreign shareholder 1.45% 9,913,484 0 0 0
NORGES BANK Foreign shareholder 0.66% 4,511,246 0 0 0
VALUE PARTNERS
HIGH-DIVIDEND STOCKS Foreign shareholder 0.62% 4,280,146 0 0 0
FUNDS
FIDELITY FUNDS Foreign shareholder 0.58% 3,997,933 0 0 0
2014 Annual Report Abstract of Yantai Changyu Pioneer Wine Co. Ltd.
BBH A/C VANGUARD
EMERGING MARKETS STOCK Foreign shareholder 0.58% 3,950,987 0 0 0
INDEX FUND
FIDELITY CHINA SPECIAL
Foreign shareholder 0.55% 3,779,202 0 0 0
SITUATIONS PLC
AGRICULTURAL BANK OF
Domestic
CHINA-HUAXIA STEADY
non-state-owned 0.53% 3,624,745 0 0 0
GROWTH MIXED SECURITIES
legal person
INVESTMENT FUND
Among the top 10 shareholders, Yantai Changyu Group Company Limited has
The explanation for the associated relationship no associated relationship or accordant action relationship with the other 9
and accordant action listed shareholders, and the relationship among the other shareholders is
unknown.
Explanation for the top 10 shareholders who
involved in financing activities and stock trading NO
business (if any)
(3) Situation of preferred shares held by top ten preferred shareholders
□ Available √ Not Available
There are no preferred shares held by top ten preferred shareholders during the report period.
2014 Annual Report Abstract of Yantai Changyu Pioneer Wine Co. Ltd.
(4) Introduction for property right and control relations between the Company and its
actual controllers
3. Management's Discussion & Analysis
(1) Summarization
Statement item Increase or Cause of major changes
decrease rate
compared the end
of the period with
the end of last
year
Operating revenue -0.38% Mainly due to decline in sales volume of
the high price products
Operating cost 1.07% Mainly due to increase of sales volume,
especially the proportion of sales in
medium-low price products increased
Sales expense -11.82% Mainly due to reduction of advertising
expense in 2014
Management expense 4.68% Mainly due to increase of wage &
welfare, depreciation and property tax in
2014 Annual Report Abstract of Yantai Changyu Pioneer Wine Co. Ltd.
2014 over the last year
R&D investment 7.47% Mainly due to increase of expenses for
the development of technology research
in 2014
Financial expense 7.72% Mainly due to reduction of interest
income resulting from decrease of time
deposit balance, and the increase of loan
interest expenditure.
Net amount of cash flow 45.57% Mainly due to the decline of sales
generated in operating expenditure that makes inflow of cash in
activities operating activities decrease
Net amount of cash flow -75.53% Mainly due to increase of cash
generated in investment expenditure for the investment projects
activities
Net amount of cash flow 90.22% Mainly due to the increase of cash
generated in financing received which gains via debt
activities
Review and summary for the early disclosed development strategy and the progress of
the Company’s business plan during the report period
During the report period, influenced by the decelerated growth on the demand for
domestic wine, market competition intensifies and the great recession on the
demand for the premium wines, the business income of the Company completed
CNY 4.2 billion, decreased by 3.8 % compared by last year, and far from the target
fixed in the beginning of the year of realizing business income no less than CNY 4.6
billion. In order to deal with the unfavorable business environment, the Company
carried out the operation strategy of steady development in the medium 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 medium and
high-end wines, the Company made an appropriate tilt on marketing resources to the
medium and low level wines, brandy and imported wines with own brands for
meeting the market demand, which played an important part in reversing the decline
on the business income. The main work in the report period is as following:
Firstly, to adjust and neaten sales system, optimize and perfect marketing modes. The
Company established three-level human recourses management system, regulate and
establish the management system of classification and decentralization of authority.
To perfect the assessment methods of Province manager, city manager, and
professional manager, basic formations for Dynamic management mechanism
‘selected, promotion, talent pool, quit’. External assignment marketers being fully
neatened and readjusted, a part of staffs being settled down via the distributaried
method. To further perfect the sales organization system consisted by three channels
2014 Annual Report Abstract of Yantai Changyu Pioneer Wine Co. Ltd.
such as medium-high channel, medium-small channel, county-level channel and some
companies such as direct-supplying company, pioneer monopoly shops, VIP Group
purchase Company, tourism sales company, E-commerce, medium-small restaurant
sales company as so on. To strive to develop various sales modes such as
direct-supplying and semi-direct supplying etc. To reinforce the terminal
development and control abilities, promote terminal sales. to further clear and definite
the main push area and channels of different liquor, improve the pertinence and
effectiveness of marketing. To strengthen the efforts for each basic management
assessment, to evaluate the professional management work for different channel,
company and province which focus on ‘terminal work’, ‘marketing program’ , and
‘the team construction of distributors and delivery dealers’, to promote every
marketing strategy and measure being implement faster and better.
Secondly, to accelerate the informatization, standardization construction and
management innovation. The Company has implemented the second phase of SAP
system project, which has been completely constructed and used in the sales system,
in order to reinforce the abilities of marketing prediction, response and controlling.
Logistic management has achieved products’ palletization for warehouse,
management and transport, improve and optimize warehouse materials, and achieved
the target of unified storage and delivery all over the country. Open video conference
system coverage of the provincial areas, improve conference efficiency, save
conference cost. Continuous to around the future development purpose and current
major issue to be addressed in management, production, technology and marketing,
proposed and completed over 500 items of the innovative and reasonable projects,
which brought the related works and management level to a new step.
Thirdly, to reinforce the construction of the vineyard bases, regulate the vineyard
bases management, the successful completion of the work on grape purchase, further
improve the research and development ability on new product and new technology.
the Company purchased 37 sets of machinery equipments, took construction and
management for Yantai vineyard bases in accordance with the criterion of scalization,
standardization and mechanization. In accordance with different vineyard bases,
which implement the classified management, make the vineyard management more
scientisfic and standards. Strictly follow the price forming mechanism for raw
material of grape as the market-set price, better quality better price, price on quality
and the linkage mechanism for grape price to integrate with the world market and
domestic market, which brought more fair and reasonable price for the Company’s
purchased grapes. Not only to make sure that the Company can purchases enough raw
material of grape with best quality, further improve the Company’s products’ cost
performance and competitiveness, but also to promote the technology upgrading of
grape cultivating in the domestic vineyards which helps lower cultivated cost and
achieve better economic benefit. During the report period, the Company carried out
over 20 items for new technology and new processes and technologies, applied for
three key Provincial Technology Innovation project, obtained one item for Scientific
and Technological Progress Award issued by China National Light Industry in 2014
annual year. Newly-introduced products of ‘zuishixian’serial have been generally
welcomed by consumers, the market reflects well.
Fourthly, to steadily carry out the capital investment projects, increase development’s
aftereffect. During the report period, the Company has overcome the various
problems and difficulties, steadily carry forward the construction of 10 investment
2014 Annual Report Abstract of Yantai Changyu Pioneer Wine Co. Ltd.
projects which were defined at the beginning of the year, the key investment projects
run smoothly.
The cause of difference that the Company’s actual operating result is 20% lower or
higher than the already disclosed annual profiting estimates.
□ Available √ Not available
the situation changes of main operation model
□ Available √ Not available
(2) Incomes
During the report period, the sales of brandy products is relatively stable; both sales
volume and sales revenue of ordinary red wine, sweet wine and sparkling wine has a
slight increase on the year-on-year basis. The sales volume and sales revenue of
chateau wine with a high selling price continues decreasing in different degree.
Comprehensively influenced by the aforementioned factors, the operating revenue of
the Company has a slight drop on the year-on-year basis.
Whether the Company’s sales revenue for material object is more than labor income
√Yes □ No
Unit: Ton
Industry Unit Year-on-year increase
Item 2014 2013
classification or decrease (%)
Wine Sales volume Ton 71,854 67,978 5.70%
Brandy Sales volume Ton 37,462 37,713 -0.67%
Explanation on the causes of over 30% year-on-year changes of the related
comparison data
□Available√ Not available
The Company’s big orders in hand
□ Available √ Not available
Major changes or adjustments of the Company’s products or services during the report
period
□ Available √ Not available
The Company’s important customers
The total sales amount of the top five customers（CNY） 142,440,887
2014 Annual Report Abstract of Yantai Changyu Pioneer Wine Co. Ltd.
Total sales of the top five customers accounting for the proportion in
3.43%
total sales for the year（%）
Information on the Company’s 5 biggest customers
√Available □Not available
Sales Amount Proportion in Annual
No. Customer Name
（CNY） Total Sales（%）
ChangyueXin trade company in
1 36,611,149 0.88%
Shenzhen city
Dali Qianxingrong wine shop at
2 35,104,002 0.84%
Nanhai district of Foshan city
Quanxing wine shop in Luocheng
3 26,583,492 0.64%
village, Hui’an town
4 Xiyu trade company in Nanjing city 22,961,125 0.55%
Chuxin trade company in
5 21,181,120 0.51%
Guangzhou city
Total — 142,440,887 3.43%
Other situation explanation of main customers
□ Available √ Not available
(3) Costs
Industry Classification
Unit: CNY
2014 2013
Proportion Proportion
Industry Year-on-year
Item in the in the increase or
Classification Amount Amount
operating operating decrease(%)
cost (%) cost (%)
2014 Annual Report Abstract of Yantai Changyu Pioneer Wine Co. Ltd.
Liquor for
749,104, 681,263,27
bottling
077 55.29% 6 51.27% 4.02%
Packing
Liquor and 446,560, 500,978,02
material
alcoholic 533 32.96% 5 37.70% -4.74%
beverages Wages 53,632,5
61 3.96% 50,892,703 3.83% 0.13%
Production
105,480,
cost
406 7.79% 95,663,454 7.20% 0.59%
Product Classification
Unit: CNY
2014 2013
Proportion Proportion
Year-on-year
Product Description in the in the increase or
Amount Amount
operating operating decrease(%)
cost (%) cost (%)
Liquor for
537,755,135 53.20% 475,798,429 49.57% 3.63%
bottling
Packing
344,532,740 34.08% 365,596,609 38.09% -4.00%
Wine material
Wages 39,214,439 3.88% 37,909,423 3.95% -0.07%
Production
89,361,588 8.84% 80,584,406 8.40% 0.44%
cost
Liquor for
161,946,222 58.37% 168,174,140 56.48% 1.88%
bottling
Brandy
Packing
88,601,388 31.93% 103,136,386 34.64% -2.71%
material
2014 Annual Report Abstract of Yantai Changyu Pioneer Wine Co. Ltd.
Wages 13,099,354 4.72% 12,262,608 4.12% 0.60%
Production
13,822,841 4.98% 14,181,985 4.76% 0.22%
cost
Note:
Comparing with the same period of last year, there is no great changes for the
products’ cost structure.
Information on the Company’s important suppliers
The total purchase amount of the top 5 suppliers 451,075,314
The proportion of the total purchase amount of the top 5 suppliers in
33.28%
the annual purchase amount
Information on the Company’s top 5 biggest suppliers
√Available □Not available
Purchase
No. Supplier Name Amount Proportion in Total
Purchase for the year（%）
(CNY)
Yantai Shenma Packaging Co.,
1 149,536,913 11.03%
Ltd.
Yantai Changyu Glass
2 126,295,616 9.32%
Co.,Ltd.
152 regiment of the eighth
3 67,846,664 5.01%
agriculture production division
Liquan subsidiary of Shandong
4 55,142,494 4.07%
Yantai Winery Co.,Ltd.
Yantai Wanfutai Winery Co.,
5 52,253,626 3.86%
Ltd
Total 451,075,314 33.28%
Other situation explanation of main customers
2014 Annual Report Abstract of Yantai Changyu Pioneer Wine Co. Ltd.
□ Available √ Not available
(4) Expenses
During the report period, the Company’s sales expense reduced 11.82% on
year-on-year basis, mainly due to the decrease of advisement promotion ， the
management expenses with a year-on-year growth of 4.68%,mainly due to the
increase on wages and welfare, depreciation and administration; financial expense
rises 7.72%, mainly due to the reduction of deposit interest income and the increase of
loan interest expenditure.
(5) R&D Expenditure
In 2013 the Company’s R&D expenditure was totally CNY 13.23 million,
respectively take up 0.19% of net asset and 0.31% of operating revenue which are
the latest financial data being audited , there are no major changes generated on
year-on-year basis.
(6) Cash Flow
Unit: CNY
Year-on-year
Item 2014 2013 increase or
decrease (%)
Subtotal of cash inflow in
4,830,092,384.00 4,836,656,367.00 -0.14%
operating activities
Subtotal of cash outflow in
3,760,009,088.00 4,101,582,060.00 -8.33%
operating activities
Net amount of cash flow
generated in operating 1,070,083,296.00 735,074,307.00 45.57%
activities
Subtotal of cash inflow in
333,107,299.00 1,326,601,601.00 -74.89%
investment activities
Subtotal of cash outflow in
1,315,841,068.00 1,886,457,048.00 -30.25%
investment activities
Net amount of cash flow -982,733,769.00 -559,855,447.00 -75.53%
generated in investment
2014 Annual Report Abstract of Yantai Changyu Pioneer Wine Co. Ltd.
activities
Subtotal of cash inflow in
644,550,372.00 259,530,444.00 148.35%
financing activities
Subtotal of cash outflow in
720,926,810.00 1,040,484,398.00 -30.71%
financing activities
Net amount of cash flow
generated in financing -76,376,438.00 -780,953,954.00 90.22%
activities
Net increase of cash and cash
3,913,342.00 -605,735,094.00 100.65%
equivalents
Explanation on the causes of over 30% year-on-year changes of the related data.
√Available □Not available
Comparing with the same period of last year, subtotal of cash inflow in investment
activities was reduced by 74.89%, mainly due to the significant decrease in the fixed
deposit whose duration is more than 3 months; subtotal of cash outflow in investment
activities was reduced by 30.25%, mainly due to the significant decrease in cash paid
for purchasing fixed deposit whose duration is more than 3 months; net amount of
cash flow generated in investment activities was reduced by 75.53%, mainly due to
the increase of cash paid for purchasing and constructing fixed assets, intangible
assets and other long-term assets; subtotal of cash inflow in financing activities
increased by 148.35%, mainly due to the increase of cash received from borrowing,
net amount of cash outflow generated in financing activities was reduced by 30.71%，
mainly due to the decrease in cash paid for dividends distribution; Net amount of cash
flow generated in financing activities was increased 90.22%, mainly due to the growth
of cash inflow but the decrease in cash outflow in investment activities; net increased
amount of cash and cash equivalents increased by 100.65%, mainly due to the
significant growth of net amount of cash flow generated both in operating activities
and in financing activities.
Explanation on the causes of the major differences between the cash inflow in the
Company’s operating activities and the years’ net profit during the report period.
2014 Annual Report Abstract of Yantai Changyu Pioneer Wine Co. Ltd.
□Available √Not available
(7) Structure of main businesses
Unit: CNY
Increase
Increase
or Increase
or
decrease or
decrease
of decrease
Operating Operating Gross of
operating of gross
revenue cost profit (%) operating
revenue profit over
cost over
over the the year
the year
year before (%)
before (%)
before (%)
Sector
Liquor
and
alcoholic
beverages 4,113,169,270 1,354,777,577 67.06% -3.76% 1.36% -1.66%
Product
Wine 3,201,368,831 1,010,863,902 68.42% -3.91% 5.31% -2.76%
Brandy 813,417,868 277,469,806 65.89% -0.64% -6.81% 3.55%
Region
Domestic 4,072,037,577 1,342,584,579 67.03% -4.33% 1.14% -1.78%
In case the Company’s statistical calibre of main business data is adjusted during the
report period, the main business data adjusted at the end of the report period will be
taken for the recent one year.
□ Available √Not available
(8) Analysis to assets and liabilities
1) Major changes of assets
Unit: CNY
At the end of 2014 At the end of 2013 Proportio Explanat
n ion on
Amount Proportio Amount Proportio increase major
2014 Annual Report Abstract of Yantai Changyu Pioneer Wine Co. Ltd.
n in the n in the or changes
total total decrease
assets assets
(%) (%) (%)
Monetary 1,145,365,071 12.85% 1,367,818,182 17.09% -4.24%
--
funds
Receivables 145,672,411 1.63% 177,109,516 2.21% -0.58% --
Inventory 2,087,376,398 23.42% 2,121,117,437 26.51% -3.09% --
Investment - - - - -
real estate
Long-term - - - - -
equity --
investments
Fixed assets 2,532,682,355 28.41% 1,917,641,344 23.97% 4.44% --
Constructio 1,700,466,500 19.07% 1,423,654,530 17.79% 1.28%
n in --
progress
2) Major changes of liabilities
Unit: CNY
2014 2013 Proportion
increase Explanation
Proportion Proportion or on major
Amount in the total Amount in the total decrease changes
assets (%) assets (%)
(%)
Short-term 300,000,000 3.37% 243,170,674 3.04% 0.33%
--
borrowings
Long-term 209,380,000 2.35% 0 0% 2.35%
--
borrowings
(9) Expectation for the Company’s future development
On the basis of our limited experience and special skills, we make the following
estimation of the wine sector and the Company’s future development.
1)The sector competition setup and development trend
Due to the continuous limitation for the domestic consumption of premium wine in
the future long time, the continuing entrance of imported wines to Chinese market,
2014 Annual Report Abstract of Yantai Changyu Pioneer Wine Co. Ltd.
and the great impact for the traditional sales channels caused by the new channels
such as E-commerce, the competition in the domestic wine industry will still be
awfully fierce in the current and future long time, the consumption for high-end wine
maybe continue to remain weak. But in the long run, thanks to increase of their
incomes, people’s pursuits to health and fashion life, the people are favoring wines
which fit well with the trend of consumption, it will ceaselessly stimulate their
demand for quality wine. That’s to say, the Chinese wine sector still has huge
potential to tap. Especially the medium-low level wine with high
performance-to-price ratio can have a faster growth. In such a case of long-term
coexistence of opportunities and challenges, only those enterprises that possess strong
branding influence and marketing ability, catch the opportunities, actively take
adjustments and make full use of oncoming and traditional sales channels, can timely
get the run of the consumers’ demands and provide products of high
performance-to-price ratio will have an opportunity to be the final winners of
competition and form a new structure of the future Chinese wine market.
2)The Company’s development strategy
The Company will continue to adhere to the strategy of taking wine as pillar product
while developing all kinds of products, actively expand the scope of consumption and
marketing mode, revise the sales decreased trend of high-end wine; develop middle-level
wines and brandy, strengthen the promotion of sparkling wine, make efforts to provide
consumers with a rich variety of products in high cost performance.
3) Management plan in a new year
In 2015, the Company will try its best to realize business income of not less than CNY4.4
billion and control the main operating costs and three period charges below CNY2.9
billion.
4) The measures the Company will take
The Company will emphasize the following aspects in 2015, so as to better catch the
opportunities and face with the challenges:
Firstly, to focus on the market, perform every marketing jobs effectively, strengthen
marketing ability. The Company will further perfect the marketing system for chateau
wine, enhance the marketing for chateau wine, the Company will cement the high
ground position of brands in the domestic wine market. Increase the media publicity
and marketing promotion efforts of medium-low level brands such as ‘jiebaina’,
‘zuishixian’ and ‘Nobel Wine’ as so on, improve the market share of medium-low
level products. Accelerate the construction of brandy extension system, assure to put
in place for ‘two teams’, ‘marketing plan’, ‘terminal construction’ in brandy’s major
channels, further expand brandy’s market-coverage and brand awareness, promote the
sales of brandy in the national market. Combine their own characteristics of
distributors and delivery dealer, establish and improve the access institution of
distributors and delivery dealer, the institution of communication, motivation and quit,
continue to push the construction of Pioneer monopoly shops forward, strengthen the
training, communication and assessment jobs of each level marketers, promote the
overall quality of cradres, reinforce the marketing ability of sales system.
2014 Annual Report Abstract of Yantai Changyu Pioneer Wine Co. Ltd.
Secondly, to further strengthen the control for production cost and major operation
expenses, further compress production cost. The Company will optimize pricing
mechanism of grapes purchase price, in order that gradually make the wine-making
grapes price convergence between domestic market and international market.
Continue to adhere the centralized purchase for the main raw materials, control
purchase cost of bulk raw material. Reinforce to monitor the production in the
warehouse, reduce capital charges. Perfect productions’ identification system, ensure
the trouble-free operation in the palletization system applied to the processes of
producing, transporting, and storage. Strengthen the management of fuel cost,
transport cost, maintenance cost and landscaping cost, perfect wage system for every
ton of wine, improve producing efficiency, reduce production cost.
Thirdly, to strengthen the construction and management for vineyards, continually
increase the research & development ability and products quality. The Company will
carry out the normalization construction and management for the vineyards in
accordance with the criterion of scalization, standardization and mechanization,
continue to practice the tracking and management of winemakers for the vineyards,
build the vineyards at Xinjiang and Yantai for promotion and demonstration on
mechanization management, greatly promote the machinery works. Continue to
neaten contract vineyard and the training of grape’s growers, strictly control the area
of contract vineyards, constantly generalize advanced planting technology. Perfect
project management, prediction management and assessment system of the vineyards,
strengthen the assessment and management of the person in charge of special area, try
to reduce the cost on planting grapes and improve the grape quality. The Company
will perfect the classification standards for bulk wine, the quality tracking of bulk
wine whole usage process and assessment mechanization, optimize winemaking
technology, reinforce the applied research on oak barrels, further improve production
quality, strengthen to develop new products, constantly enrich products variety.
Further distinguish and clear the products characteristic of general wine in different
varieties, form the products line with distinctive and unique style.
Fourthly, to steadily carry forwards investment projects construction, scientific
arrange the progress of construction, guarantee the engineering quality. The Company
will continuously promote the projects of Yantai Changyu International Wine City
(namely Yantai Changyu Industrial Park) and the construction for pioneer monopoly
shops, reinforce the management of construction budget to investment projects,
strengthen projects’ cost review and completion audit, strictly control the investment
amount on projects, make sure to finish the construction for all projects and put them
into operation on the basis of scheduled progress and quality.
4. Issues related to financial report
(1) Compared with the previous year’s financial report, explanation for the
changes of accounting policy , accounting estimation and accounting method.
√Available □Not available
During the report period, the Company changes the accounting policy about
Long-term Equity Investment. About the detailed contents, please see ‘‘25. Changes
in significant accounting policy’’ in ‘‘3. Significant accounting policy and accounting
estimate’’ of foot-notes to financial statements in this report.
2014 Annual Report Abstract of Yantai Changyu Pioneer Wine Co. Ltd.
(2) During the report period, the situation explanation for the correction of major
accounting errors which need to be retrospect and restated.
□Available √Not available
There is no situation for the correction of major accounting errors which need to be
retrospect and restated.
(3) Compared with the previous year’s financial report, explanation for the
changes of the consolidated statements scope.
□Available √Not available
There is no situation for the changes of the consolidated statement scope.
(4) The Board of Directors’ and the Board of Supervisor give the explanation for ‘no
standard auditing report’ issued by the accounting firm during this report period.
□Available √Not available
Yantai Changyu Pioneer Wine Co. Ltd.
Board of Directors
28th April 2015
