2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Financial Report
1. Audit report
Whether the semiannual report has been audited
□ Yes √ No
2. Financial statement
The unit in the statements of the financial annotations is RMB Yuan.
2.1 Consolidated balance sheet
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd. June 30, 2020 Unit: Yuan
Item Note June 30, 2020 December 31, 2019
Current assets:
Monetary fund 7.1 1,476,207,055 1,565,783,980
Settlement reserves
Lending funds
Tradable financial assets
Derivative financial assets
Bills receivable
Accounts receivable 7.2 167,738,633 266,218,153
Receivables financing 7.3 222,918,741 316,470,229
Advance payment 7.4 10,200,527 67,707,537
Premium receivable
Reinsurance accounts receivable
Receivable reserves for reinsurance contract
Other receivables 7.5 25,594,801 24,246,812
Including: Interest receivable 698,347 148,927
Dividends receivable
Redemptory monetary capital for sale
Inventories 7.6 2,936,133,260 2,872,410,407
Contract assets
Assets held for sale
Non-current assets due within one year
Other current assets 7.7 262,917,721 267,424,938
Total current assets 5,101,710,738 5,380,262,056
Non-current assets:
Offering loans and imprest
Debt investments
Other debt investments
Long-term receivables
Long-term equity investments 7.8 42,810,445 43,981,130
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Item Note June 30, 2020 December 31, 2019
Other investments in equity instruments
Other non-current financial assets
Investment real estate 7.9 28,344,687 29,714,586
Fixed assets 7.10 5,818,499,845 5,894,068,898
Construction in progress 7.11 647,036,593 567,478,833
Productive biological assets 7.12 196,238,591 202,425,286
Oil-and-gas assets
Right-of-use assets
Intangible assets 7.13 641,220,580 651,946,355
Development expenditure
Goodwill 7.14 141,859,193 141,859,193
Long-term prepaid expenses 7.15 270,769,497 277,595,408
Deferred income tax assets 7.16 214,323,893 264,926,503
Other non-current assets 7.17 184,158,436 193,674,320
Total non-current assets 8,185,261,760 8,267,670,512
Total assets 13,286,972,498 13,647,932,568
Current liabilities:
Short-term loans 7.18 737,183,701 754,313,744
Borrowings from the Central Bank
Loans from other banks and other financial institutions
Tradable financial liabilities
Derivative financial liabilities
Bills payable
Accounts payable 7.19 379,727,980 570,252,612
Advances from customers 120,609,499
Contract liabilities 7.20 100,523,260
Financial assets sold for repurchase
Deposits from customers and interbank
Receivings from vicariously traded securities
Receivings from vicariously sold securities
Employee remunerations payable 7.21 139,862,928 234,459,116
Taxes and dues payable 7.22 154,572,275 375,169,971
Other payables 7.23 793,033,613 450,532,485
Including: Interest payable 2,167,287 758,047
Dividends payable 480,819,925 1,366,559
Handling charges and commissions payable
Dividend payable for reinsurance
Liabilities held for sale
Non-current liabilities due within one year 7.24 98,996,064 150,826,221
Other current liabilities 13,068,024
Total current liabilities 2,416,967,845 2,656,163,648
Non-current liabilities:
Reserves for insurance contracts
Long-term borrowings 7.25 218,613,336 128,892,501
Bonds payable
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Item Note June 30, 2020 December 31, 2019
Including: Preferred stock
Perpetual bonds
Lease liabilities
Long-term accounts payable 7.26 167,000,000 191,000,000
Long-term employee remunerations payable
Estimated liabilities
Deferred income 7.27 61,772,908 70,701,288
Deferred income tax liabilities 7.16 14,303,137 14,691,424
Other non-current liabilities 7.28 7,645,777 7,645,777
Total non-current liabilities 469,335,158 412,930,990
Total liabilities 2,886,303,003 3,069,094,638
Owner’s equity:
Capital stock 7.29 685,464,000 685,464,000
Other equity instruments
Including: Preferred stock
Perpetual bonds
Capital surplus 7.30 565,050,422 565,050,422
Minus: Treasury stock
Other comprehensive income 7.31 -9,242,236 -4,235,583
Special reserves
Surplus reserves 7.32 342,732,000 342,732,000
General risk preparation
Undistributed profit 7.33 8,547,110,131 8,719,899,359
Total owner’s equities attributable to the parent company 10,131,114,317 10,308,910,198
Minority equity 269,555,178 269,927,732
Total owner’s equities 10,400,669,495 10,578,837,930
Total liabilities and owner’s equities 13,286,972,498 13,647,932,568
Legal Representative: Zhou Hongjiang Accounting Supervisor: Jiang Jianxun Accounting Department Manager: Guo Cuimei
2.2 Balance sheet of the parent company
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd. Unit: Yuan
Item Note June 30, 2020 December 31, 2019
Current assets:
Monetary fund 798,084,475 710,505,269
Tradable financial assets
Derivative financial assets
Bills receivable
Accounts receivable 17.1 302,260 1,988,326
Receivables financing 34,212,039 41,679,635
Advance payment 33,862 776,539
Other receivables 17.2 278,883,935 586,424,958
Including: Interest receivable 464,614 90,355
Dividends receivable 2,985,375 200,000,000
Inventories 501,196,687 434,007,808
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Item Note June 30, 2020 December 31, 2019
Contract assets
Assets held for sale
Non-current assets due within one year
Other current assets 37,051,338 39,130,466
Total current assets 1,649,764,596 1,814,513,001
Non-current assets:
Debt investments
Other debt investments
Long-term receivables
Long-term equity investments 17.3 7,437,422,621 7,432,422,621
Other investments in equity instruments
Other non-current financial assets
Investment real estate 28,920,958 29,714,586
Fixed assets 250,196,215 261,137,072
Construction in progress
Productive biological assets 117,388,982 121,414,096
Oil and gas assets
Right-of-use assets
Intangible assets 63,675,337 64,864,913
Development expenditure
Goodwill
Long-term prepaid expenses
Deferred income tax assets 17,961,520 16,255,870
Other non-current assets 1,524,700,000 1,427,700,000
Total non-current assets 9,440,265,633 9,353,509,158
Total assets 11,090,030,229 11,168,022,159
Current liabilities:
Short-term loans 150,000,000 150,000,000
Tradable financial liabilities
Derivative financial liabilities
Bills payable
Accounts payable 32,575,693 63,655,240
Advances from customers
Contract liabilities
Employee remunerations 57,841,188 70,445,847
Taxes and dues payable 4,129,507 6,052,456
Other payables 1,038,359,009 660,149,563
Including: Interest payable 137,671 181,250
Dividends payable 479,824,800
Liabilities held for sale
Non-current liabilities due within one year
Other current liabilities
Total current liabilities 1,282,905,397 950,303,106
Non-current liabilities:
Long-term borrowings
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Item Note June 30, 2020 December 31, 2019
Bonds payable
Including: Preferred stock
Perpetual bonds
Lease liabilities
Long-term accounts payable
Long-term employee remuneration payable
Estimated liabilities
Deferred income 7,459,789 9,176,315
Deferred income tax liabilities
Other non-current liabilities 3,146,706 3,146,707
Total non-current liabilities 10,606,495 12,323,022
Total liabilities 1,293,511,892 962,626,128
Owner’s equity:
Capital stock 685,464,000 685,464,000
Other equity instruments
Including: Preferred stock
Perpetual bonds
Capital surplus 557,222,454 557,222,454
Minus: Treasury stock
Other comprehensive income
Special reserves
Surplus reserves 342,732,000 342,732,000
Undistributed profit 8,211,099,883 8,619,977,577
Total owner’s equities 9,796,518,337 10,205,396,031
Total liabilities and owner’s equities 11,090,030,229 11,168,022,159
Legal Representative: Zhou Hongjiang Accounting Supervisor: Jiang Jianxun Accounting Department Manager: Guo Cuimei
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. Total operating income 1,401,606,792 2,558,274,785
Including: Operating income 7.34 1,401,606,792 2,558,274,785
Interest income
Earned premium
Handling fee and commission income
2. Total operating costs 1,040,122,175 1,818,822,580
Including: Operating costs 7.34 574,650,677 936,252,225
Interest expenditure
Handling fees and commission expenditure
Premium rebate
Net amount of indemnity expenditure
Net amount of the withdrawn reserve fund for insurance
contract
Policy bonus payment
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Amortized reinsurance expenditures
Item Note Sum of current period Sum of prior period
Taxes and surcharges 7.35 88,103,493 123,550,848
Selling expenses 7.36 250,531,046 591,970,801
Administrative expenses 7.37 113,069,869 155,552,312
Research and development expenses 7.38 1,805,988 2,706,811
Financial expenses 7.39 11,961,102 8,789,583
Including: Interest expenses 14,891,310 9,812,560
Interest income 6,088,281 4,606,417
Plus: Other profit 7.40 49,780,231 64,211,892
Investment profit (loss is listed with "-") 7.41 -1,170,685
Including: Investment profit for joint-run business and joint
-1,170,685
venture
Financial assets measured at amortized cost cease
to be recognized as income (loss is listed with
"-")
Exchange income (loss is listed with "-")
Net exposure hedge income (loss is listed with "-")
Income from fair value changes (loss is listed with "-")
Credit impairment loss (loss is listed with "-") 7.42 100,835 -765,935
Asset impairment loss (loss is listed with "-") 7.43 4,242,813 6,148,729
Income from asset disposal (loss is listed with "-") 7.44 39,641 1,138
3. Operating profit (loss is listed with "-") 414,477,452 809,048,029
Plus: Non-operating income 7.45 4,682,230 3,575,914
Minus: Non-operating expenses 7.46 867,273 164,050
4. Total profits (total loss is listed with "-") 418,292,409 812,459,893
Minus: Income tax expenses 7.47 109,689,969 210,281,578
5. Net profit (net loss is listed with "-") 308,602,440 602,178,315
5.1 Classification by operation continuity
5.1.1 Net profit from continuing operation (net loss is listed with
308,602,440 602,178,315
"-")
5.1.2 Net profit from terminating operation (net loss is listed
with "-")
5.2 Classification by ownership
5.2.1 Net profit attributable to owner of the parent company 307,035,572 603,403,789
5.2.2 Minority interest income 1,566,868 -1,225,474
6. Net after-tax amount of other comprehensive income 7.48 -5,765,822 -4,657,291
Net after-tax amount of other comprehensive income attributable to
-5,006,653 -3,060,721
owner of the parent company
6.1 Other comprehensive income not to be reclassified into profit and
loss later
6.1.1 Changes after remeasuring and resetting the benefit plans
6.1.2 Other comprehensive income not to be reclassified into profit
and loss under equity law
6.1.3 Changes in the fair value of other investments in equity
instruments
6.1.4 Changes in the fair value of the enterprise's own credit risk
6.1.5 Other
6.2 Other comprehensive income to be reclassified into profit and
-5,006,653 -3,060,721
loss later
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
6.2.1 Other comprehensive income to be reclassified into profit and
loss under equity law
6.2.2 Changes in the fair value of other debt investments
6.2.3 Amount of financial assets reclassified into other
comprehensive income
6.2.4 Provision for credit impairment of other credit investments
6.2.5 Provision for cash-flow hedge
6.2.6 Difference in translation of Foreign Currency Financial
-5,006,653 -3,060,721
Statement
6.2.7 Other
Net after-tax amount of other comprehensive income attributable to
-759,169 -1,596,570
minority shareholders
7. Total comprehensive income 302,836,618 597,521,024
Attributable to owner of the parent company 302,028,919 600,343,068
Attributable to minority shareholders 807,699 -2,822,044
8. Earnings per share:
8.1 Basic earnings per share 0.45 0.88
8.2 Diluted earnings per share 0.45 0.88
Legal Representative: Zhou Hongjiang Accounting Supervisor: Jiang Jianxun Accounting Department Manager: Guo Cuimei
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. Operating income 17.4 152,950,515 352,351,002
Minus: Operating costs 17.4 143,241,194 309,570,580
Taxes and surcharges 4,379,365 13,140,156
Selling expenses
Administrative expenses 30,150,311 39,434,246
Research and development expenses 318,917 405,061
Financial expenses 934,777 -3,657,370
Including: Interest expenses 2,807,750 -2,705,073
Interest income 2,251,235 1,470,667
Plus: Other profit 1,819,890 1,716,527
Investment profit (loss is listed with "-") 17.5 87,474,604 264,221,755
Including: Investment profit for joint-run business and joint
venture
Financial assets measured at amortized cost cease
to be recognized as income (loss is listed with
"-")
Net exposure hedge income (loss is listed with "-")
Income from fair value changes (loss is listed with "-")
Credit impairment loss (loss is listed with "-") 599,632
Asset impairment loss (loss is listed with "-")
Income from asset disposal (loss is listed with "-")
2. Operating profit (loss is listed with "-") 63,820,077 259,396,611
Plus: Non-operating income 2,007,235 703,559
Minus: Non-operating expenses 525,000 97,638
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
3. Total profits (total loss is listed with "-") 65,302,312 260,002,532
Item Note Sum of current period Sum of prior period
Minus: Income tax expenses -5,644,794 -726,946
4. Net profit (net loss is listed with "-") 70,947,106 260,729,478
4.1Net profit from continuing operation (net loss is listed with
70,947,106 260,729,478
"-")
4.2 Net profit from terminating operation (net loss is listed with
"-")
5. Net after-tax amount of other comprehensive income
5.1 Other comprehensive income not to be reclassified into profit and
loss later
5.1.1 Changes after remeasuring and resetting the benefit plans
5.1.2 Other comprehensive income not to be reclassified into profit
and loss under equity law
5.1.3 Changes in the fair value of other investments in equity
instruments
5.1.4 Changes in the fair value of the enterprise's own credit risk
5.1.5 Other
5.2 Other comprehensive income to be reclassified into profit and
loss later
5.2.1 Other comprehensive income to be reclassified into profit and
loss under equity law
5.2.2 Changes in the fair value of other debt investments
5.2.3 Amount of financial assets reclassified into other
comprehensive income
5.2.4 Provision for credit impairment of other credit investments
5.2.5 Provision for cash-flow hedge
5.2.6 Difference in translation of Foreign Currency Financial
Statement
5.2.7 Other
6. Total comprehensive income 70,947,106 260,729,478
7. Earnings per share:
7.1 Basic earnings per share 0.10 0.38
7.2 Diluted earnings per share 0.10 0.38
Legal Representative: Zhou Hongjiang Accounting Supervisor: Jiang Jianxun Accounting Department Manager: Guo Cuimei
2.5 Consolidated cash flow statement
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd. Unit: Yuan
Item Note Sum of current period Sum of prior period
1. Cash flows from operating activities:
Cash received from sales of goods and rending of services 1,488,831,127 2,399,548,448
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
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Item Note Sum of current period Sum of prior period
Cash received from collecting interest, handling fees and
commissions
Net increase in borrowing funds
Net increase in repurchasement business funds
Net cash received for buying and selling securities
Tax refund received 23,217,782 20,038,271
Other cash received related to operating activities 7.49 48,173,534 67,785,620
Subtotal of cash flows of operating activities 1,560,222,443 2,487,372,339
Cash paid for goods and services 630,954,042 718,093,432
Net increase in customer loans and advances
Net increase in deposits in central bank and interbank deposits
Cash paid to original insurance contract payments
Net increase in lending funds
Cash paid to interest, handling fees and commissions
Cash paid to policy bonus
Cash paid to and on behalf of employees 231,967,796 278,638,333
Cash paid for taxes and expenses 467,810,691 598,384,101
Other cash paid related to operating activities 7.49 259,142,735 392,780,467
Sub-total of cash outflows of operating activities 1,589,875,264 1,987,896,333
Net cash flow from operating activities -29,652,821 499,476,006
2. Cash flow from investing activities:
Cash received from disinvestment
Cash received from withdrawal of fixed deposits 60,128,600 104,597,650
Cash received from obtaining investment income
Cash received from obtaining interest income 1,160,244 1,004,552
Cash received from disposal of fixed assets, intangible assets and
131,978 175,837
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 61,420,822 105,778,039
Cash paid to acquire fixed assets, intangible assets and other
65,946,953 135,073,897
long-term assets
Cash for investment
Cash paid for purchasing fixed deposits 35,200,000 85,238,750
Net increase in hypothecated loan
Net cash paid for acquiring branch and other business unit
Other cash paid related to investment activities
Subtotal of cash outflows of investment activities 101,146,953 220,312,647
Net cash flow from investing activities -39,726,131 -114,534,608
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 778,228,305 656,495,139
Other cash received related to financing activities
Subtotal cash flows of financing activities 778,228,305 656,495,139
Cash paid for paying debts 758,287,985 658,033,492
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Item Note Sum of current period Sum of prior period
Cash paid for distributing dividend and profit or paying interest 15,235,695 16,590,004
Including: dividend and profit paid to minority shareholders by
1,551,687
branch
Other cash paid related to financing activities
Subtotal of cash outflows of financing activities 773,523,680 674,623,496
Net cash flow from financing activities 4,704,625 -18,128,357
4. Influences of exchange rate fluctuation on cash and cash
-307,959 53,702
equivalents
5. Net Increase in cash and cash equivalents -64,982,286 366,866,743
Plus: balance at the beginning of the period of cash and cash
1,365,772,675 1,206,860,334
equivalents
6. Balance at the end of the period of cash and cash equivalents 1,300,790,389 1,573,727,077
Legal Representative: Zhou Hongjiang Accounting Supervisor: Jiang Jianxun Accounting Department Manager: Guo Cuimei
2.6 Cash flow statement 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 176,514,170 219,405,421
Tax refund received
Other cash received related to operating activities 14,486,373 57,674,830
Subtotal of cash flows of operating activities 191,000,543 277,080,251
Cash paid for goods and services 149,176,637 163,184,301
Cash paid to and on behalf of employees 25,497,870 45,116,586
Cash paid for taxes and expenses 2,648,464 22,530,113
Other cash paid related to operating activities 107,931,895 321,847,893
Sub-total of cash outflows of operating activities 285,254,866 552,678,893
Net cash flow from operating activities -94,254,323 -275,598,642
2. Cash flow from investing activities:
Cash received from disinvestment
Cash received from withdrawal of fixed deposits 15,200,000 40,000,000
Cash received from obtaining investment income 287,246,945 760,152,668
Cash received from obtaining interest income 142,759 484,857
Net cash received from disposal of fixed assets, intangible assets and
7,519
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 302,589,704 800,645,044
Cash paid to acquiring fixed assets, intangible assets and other
1,040,048 10,164,233
long-term assets
Cash for investment 5,000,000 13,000,000
Cash paid for purchasing fixed deposits 15,200,000 85,238,750
Net cash paid for acquiring branch and other business unit
Other cash paid related to investment activities 97,000,000
Subtotal of cash outflows of investment activities 118,240,048 108,402,983
Net cash flow from investing activities 184,349,656 692,242,061
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Item Sum of current period Sum of prior period
3. Cash flow from financing activities
Cash received from acquiring investment
Cash received from acquiring loans 150,000,000
Other cash received related to financing activities
Subtotal cash flows of financing activities 150,000,000
Cash paid for debts 150,000,000
Cash paid to distribute dividend, profit or pay interest 2,748,375 3,248,000
Other cash paid related to financing activities
Subtotal of cash outflows of financing activities 152,748,375 3,248,000
Net cash flow from financing activities -2,748,375 -3,248,000
4. Influences of exchange rate fluctuation on cash and cash
equivalents
5. Net Increase in cash and cash equivalents 87,346,958 413,395,419
Plus: balance at the beginning of the period of cash and cash
623,116,542 532,384,882
equivalents
6. Balance at the end of the period of cash and cash equivalents 710,463,500 945,780,301
Legal Representative: Zhou Hongjiang Accounting Supervisor: Jiang Jianxun Accounting Department Manager: Guo Cuimei
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
2.7 Consolidated owner’s equity changing list
Unit: Yuan
This period
Owners’ equity of the parent company
Item Other equity Minority
Minus: Other General Total owners’
instruments Capital Special Surplus Undistributed shareholders’
Capital stock Treasury comprehensive risk Other Subtotal equity
Preferred Perpetual reserves reserves reserves profits equity
stock income preparation
stock bonds Other
1. Balance at the end of
685,464,000 565,050,422 -4,235,583 342,732,000 8,719,899,359 10,308,910,198 269,927,732 10,578,837,930
last year
Plus: Accounting
policies changing
Previous error
correction
Business combination
under common control
Other
2. Balance at the
685,464,000 565,050,422 -4,235,583 342,732,000 8,719,899,359 10,308,910,198 269,927,732 10,578,837,930
beginning of this year
3. Increased or
decreased amount in
this period (reducing -5,006,653 -172,789,228 -177,795,881 -372,554 -178,168,435
amount is listed with
"-")
3.1 Total
-5,006,653 307,035,572 302,028,919 807,699 302,836,618
comprehensive income
3.2 Owners' invested
and reduced capital
3.2.1 Owner’ invested
common stock
3.2.2 Other equity
instrument holders’
invested capital
3.2.3 Amount of shares
paid and reckoned in
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
owners' equity
3.2.4 Other
3.3 Profit distribution -479,824,800 -479,824,800 -1,180,253 -481,005,053
3.3.1 Accrued surplus
reserves
3.3.2 Accrued general
risk preparation
3.3.3 Distribution to
owners (or -479,824,800 -479,824,800 -1,180,253 -481,005,053
shareholders)
3.3.4 Other
3.4 Internal transfer of
owners' equity
3.4.1 Capital reserves
transferred and
increased capital (or
capital stock)
3.4.2 Surplus reserves
transferred and
increased capital (or
capital stock)
3.4.3 Surplus reserves
covering deficit
3.4.4 Retained earnings
carried over from the
benefit plan variation
3.4.5 Retained earnings
carried over from other
comprehensive income
3.4.6 Other
3.5 Special reserves
3.5.1 Withdrawal in this
period
3.5.2 Usage in this
period
3.6 Other
4. Balance at the end of
685,464,000 565,050,422 -9,242,236 342,732,000 8,547,110,131 10,131,114,317 269,555,178 10,400,669,495
this period
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Last period
Owners’ equity of the parent company
Item Other equity Minority
Minus: Other General Total owners’
instruments Capital Special Surplus Undistributed shareholders’
Capital stock Treasury comprehensive risk Other Subtotal equity
reserves reserves reserves profits equity
Preferred Perpetual stock income preparation
stock bonds Other
1. Balance at the end of
685,464,000 565,955,441 2,965,377 342,732,000 8,008,982,547 9,606,099,365 284,388,012 9,890,487,377
last year
Plus: Accounting
-7,540,537 -7,540,537 -7,540,537
policies changing
Previous error
correction
Business combination
under common control
Other
2. Balance at the
685,464,000 565,955,441 2,965,377 342,732,000 8,001,442,010 9,598,558,828 284,388,012 9,882,946,840
beginning of this year
3. Increased or
decreased amount in
this period (reducing -905,019 -7,200,960 718,457,349 710,351,370 -14,460,280 695,891,090
amount is listed with
"-")
3.1 Total
-7,200,960 1,129,735,749 1,122,534,789 -1,368,953 1,121,165,836
comprehensive income
3.2 Owners' invested
-905,019 -905,019 -10,714,533 -11,619,552
and reduced capital
3.2.1 Owner’ invested
-905,019 -905,019 -10,714,533 -11,619,552
common stock
3.2.2 Other equity
instrument holders’
invested capital
3.2.3 Amount of shares
paid and reckoned in
owners' equity
3.2.4 Other
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
3.3 Profit distribution -411,278,400 -411,278,400 -2,376,794 -413,655,194
3.3.1 Accrued surplus
reserves
3.3.2 Accrued general
risk preparation
3.3.3 Distribution to
owners (or -411,278,400 -411,278,400 -2,376,794 -413,655,194
shareholders)
3.3.4 Other
3.4 Internal transfer of
owners' equity
3.4.1 Capital reserves
transferred and
increased capital (or
capital stock)
3.4.2 Surplus reserves
transferred and
increased capital (or
capital stock)
3.4.3 Surplus reserves
covering deficit
3.4.4 Retained earnings
carried over from the
benefit plan amount
3.4.5 Retained earnings
carried over from other
comprehensive income
3.4.6 Other
3.5 Special reserves
3.5.1 Withdrawal in this
period
3.5.2 Usage in this
period
3.6 Other
4. Balance at the end of
685,464,000 565,050,422 -4,235,583 342,732,000 8,719,899,359 10,308,910,198 269,927,732 10,578,837,930
this period
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
2.8 Owner’s equity changing list of the parent company
Unit: Yuan
This period
Item Other equity instruments Minus: Other Total owners’
Capital Capital Special Surplus Undistributed equity
Preferred Perpetual Treasury comprehensive Other
stock Other reserves reserves reserves profits
stock bonds stock income
1. Balance at the end of last year 685,464,000 557,222,454 342,732,000 8,619,977,577 10,205,396,031
Plus: Accounting policies changing
Previous error correction
Other
2. Balance at the beginning of this year 685,464,000 557,222,454 342,732,000 8,619,977,577 10,205,396,031
3. Increased or decreased amount in this
period (reducing amount is listed with -408,877,694 -408,877,694
"-")
3.1 Total comprehensive income 70,947,106 70,947,106
3.2 Owners' invested and reduced capital
3.2.1 Owners’ invested common stock
3.2.2 Other equity instrument holder’
invested capital
3.2.3 Amount of shares paid and
reckoned in owners' equity
3.2.4 Other
3.3 Profit distribution -479,824,800 -479,824,800
3.3.1 Drew surplus reserves
3.3.2 Distribution to owners (or
-479,824,800 -479,824,800
shareholders)
3.3.3 Other
3.4 Internal transfer of owners' equity
3.4.1 Capital reserves transferred and
increased capital (or capital stock)
3.4.2 Surplus reserves transferred and
increased capital (or capital stock)
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
3.4.3 Surplus reserves covering deficit
3.4.4 Retained earnings carried over
from the benefit plan amount
3.4.5 Retained earnings carried over
from other comprehensive income
3.4.6 Other
3.5 Special reserves
3.5.1 Accrual in this period
3.5.2 Usage in this period
3.6 Other
4. Balance at the end of this period 685,464,000 557,222,454 342,732,000 8,211,099,883 9,796,518,337
Unit: Yuan
Last period
Item Other equity instruments Minus: Other Total owners’
Capital Capital Special Surplus Undistributed equity
Preferred Perpetual Treasury comprehensive Other
stock Other reserves reserves reserves profits
stock bonds stock income
1. Balance at the end of last year 685,464,000 557,222,454 342,732,000 8,437,957,128 10,023,375,582
Plus: Accounting policies changing
Previous error correction
Other
2. Balance at the beginning of this year 685,464,000 557,222,454 342,732,000 8,437,957,128 10,023,375,582
3. Increased or decreased amount in this
period (reducing amount is listed with 182,020,449 182,020,449
"-")
3.1 Total comprehensive income 593,298,849 593,298,849
3.2 Owners' invested and reduced capital
3.2.1 Owners’ invested common stock
3.2.2 Other equity instrument holder’
invested capital
3.2.3 Amount of shares paid and
reckoned in owners' equity
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
3.2.4 Other
3.3 Profit distribution -411,278,400 -411,278,400
3.3.1 Drew surplus reserves
3.3.2 Distribution to owners (or
-411,278,400 -411,278,400
shareholders)
3.3.3 Other
3.4 Internal transfer of owners' equity
3.4.1 Capital reserves transferred and
increased capital (or capital stock)
3.4.2 Surplus reserves transferred and
increased capital (or capital stock)
3.4.3 Surplus reserves covering deficit
3.4.4 Retained earnings carried over
from the benefit plan amount
3.4.5 Retained earnings carried over
from other comprehensive income
3.4.6 Other
3.5 Special reserves
3.5.1 Accrual in this period
3.5.2 Usage in this period
3.6 Other
4. Balance at the end of this period 685,464,000 557,222,454 342,732,000 8,619,977,577 10,205,396,031
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
3. Company profile
Yantai Changyu Pioneer Wine Co., Ltd. (the “Company” or the “Joint-stock Company”) was
incorporated as a joint-stock limited company in accordance with the Company Law of the People’s
Republic of China (the “PRC”) in the merger and reorganization carried out by Yantai Changyu Group
Co., Ltd. (“Changyu Group Company”) with its assets and liabilities in relation to wine business. The
Company and its subsidiary companies (hereinafter collectively referred to as the “Group”) are
engaged in the production and sale of wine, brandy and champagne, planting and purchase of grapes,
development of tourism resources, etc. The registered address of the Company is Yantai City,
Shandong Province, and the office address of the headquarters is 56 Dama Road, Zhifu District, Yantai
City, Shandong Province.
As at June 30, 2020, the Company issued 685,464,000 shares accumulatively. Refer to Note 7.29 for
details.
The parent company of the Group is Changyu Group Company incorporated in China, which was
ultimately and actually controlled by four parties, including Yantai Guofeng Investment Holding Co.,
Ltd., ILLVA Saronno Holding Spa, International Finance Corporation and Yantai Yuhua Investment &
Development Co., Ltd.
The financial statement and the consolidated financial statement of the Company were approved by
the Board of Directors on August 26, 2020.
The details of scope of the consolidated financial statement in this period can be seen in Note 9
“Equity in other entities”. The details of scope changes of the consolidated financial statement in this
period can be seen in Note 8 “Changes of the consolidated scope”.
4. Preparation basis of financial statement
4.1 Preparation basis
The Group implements the Accounting Standards for Business Enterprises (including the new and
revised editions published in 2014) (“ASBE”) published by the Ministry of Finance and relevant
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
regulations thereof.
4.2 Continuous operation
The Group has appraised the ability of continuous operation for 12 months from June 30, 2020, and no
issues or situations causing major doubts to this ability are found. Therefore, this financial statement is
prepared on the basis of the continuous operation assumption.
5. Main accounting policies and accounting estimates
5.1 Statement on compliance with ASBE
This financial statement fulfills the requirement of ASBE issued by the Ministry of Finance and gives
a true and integrated view of the consolidated financial status and the financial status as at June 30,
2020, as well as the consolidated operating result, the operating result, the consolidated cash flow and
the cash flow of the Company from January to June 2020.
In addition, the financial statement of the Company also complies with the related disclosure
requirements for statement and its notes stipulated by Preparation Rules for Information Disclosure by
Companies Offering Securities to the Public No. 15 – General Provisions on Financial Reports (2014
Revision) by the China Securities Regulatory Commission (hereinafter referred to as the “CSRC”).
5.2 Accounting period
The accounting year is from January 1 to December 31 in Gregorian calendar.
5.3 Operating cycle
The operating cycle refers to the period from the enterprise purchases the assets used for processing to
the cash or cash equivalent is realized. The operating cycle of the Company is 12 months.
5.4 Recording currency
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
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 recording currency. The overseas subsidiary companies thereof determine
EUR, CLP and AUD as the recording currency according to the main economic environment in which
they are situated. The currency in this financial statement prepared by the Group is RMB.
5.5 Accounting treatment method for business combination under common control and
non-common control
5.5.1 Business combination and goodwill under common control
A business combination under common control is a business combination in which all of the
combining enterprises are ultimately controlled by the same party or same multiple parties before and
after the combination, and that control is not transitory. The assets and liabilities obtained by the
combining party in the business combination shall be measured on the basis of the carrying amount in
the ultimate controlling party's consolidated financial statement as at the combination date. Where
there is a difference between the carrying amount of the net assets acquired and the carrying amount of
the combination consideration paid (or the total par value of the shares issued), the stock premium in
capital surplus shall be adjusted. If the stock premium in capital surplus is not sufficient to offset, the
retained earnings shall be adjusted. The direct related expenses incurred for the business combination
shall be included in the current profit and loss when incurred. The combination date is the date on
which the combining party actually obtains control of the combined party.
5.5.2 Business combination under non-common control
A business combination under non-common control is a business combination in which all of the
combining parties are not ultimately controlled by the same party or same multiple parties before and
after the combination. The sum of fair values of the assets paid by the Group, as the acquirer,
(including the acquiree’s equity the Group held before the acquisition date), liabilities incurred or
assumed, and the equity securities issued on the acquisition date in exchange for the control over the
acquiree, deducts the fair value of the acquiree’s identifiable net assets acquired in the combination on
the acquisition date. If the difference is positive, it shall be recognized as goodwill; and if it is negative,
it shall be included in the current profit and loss. All the identifiable assets, liabilities and contingent
liabilities which are obtained from the acquiree and meet the recognition conditions shall be confirmed
by the Group on the acquisition date according to the fair value thereof. The acquisition date is the
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
date on which the acquirer actually obtains control of the acquiree.
For a business combination involving entities not under common control and achieved in stages, the
Group remeasures its previously-held equity interest in the acquiree to its acquisition-date fair value
and recognises any resulting difference between the fair value and the carrying amount as investment
income or other comprehensive income for the current period. In addition, any amount recognised in
other comprehensive income that may be reclassified to profit or loss, in prior reporting periods
relating to the previously-held equity interest, and any other changes in the owners’ equity under
equity accounting, are transferred to investment income in the period in which the acquisition occurs.
If equity interests of the acquiree held before acquisition-date were equity instrument investments
measured at fair value through other comprehensive income, other comprehensive income recognised
shall be moved to retained earnings on acquisition-date.
5.6 Compiling methods of consolidated financial statement
5.6.1 General principles
The scope of consolidated financial statements is based on control and the consolidated financial
statements comprise the Company and its subsidiaries. Control exists when the investor has all of
following: power over the investee; exposure, or rights, to variable returns from its involvement with
the investee and has the ability to affect those returns through its power over the investee. When
assessing whether the Group has power, only substantive rights (held by the Group and other parties)
are considered. The financial position, financial performance and cash flows of subsidiaries are
included in the consolidated financial statements from the date that control commences until the date
that control ceases.
Non-controlling interests are presented separately in the consolidated balance sheet within
shareholders’ equity. Net profit or loss attributable to non-controlling shareholders is presented
separately in the consolidated income statement below the net profit line item. Total comprehensive
income attributable to non-controlling shareholders is presented separately in the consolidated income
statement below the total comprehensive income line item.
When the amount of loss for the current period attributable to the non-controlling shareholders of a
subsidiary exceeds the non-controlling shareholders’ share of the opening owners’ equity of the
subsidiary, the excess is still allocated against the non-controlling interests.
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
When the accounting period or accounting policies of a subsidiary are different from those of the
Company, the Company makes necessary adjustments to the financial statements of the subsidiary
based on the Company’s own accounting period or accounting policies. Intra-group balances and
transactions, and any unrealised profit or loss arising from intra-group transactions, are eliminated
when preparing the consolidated financial statements. Unrealised losses resulting from intra-group
transactions are eliminated in the same way as unrealised gains, unless they represent impairment
losses that are recognised in the financial statements.
5.6.2 Subsidiaries acquired through a business combination
Where a subsidiary was acquired during the reporting period, through a business combination
involving entities under common control, the financial statements of the subsidiary are included in the
consolidated financial statements based on the carrying amounts of the assets and liabilities of the
subsidiary in the financial statements of the ultimate controlling party as if the combination had
occurred at the date that the ultimate controlling party first obtained control. The opening balances and
the comparative figures of the consolidated financial statements are also restated.
Where a subsidiary was acquired during the reporting period, through a business combination
involving entities not under common control, the identifiable assets and liabilities of the acquired
subsidiaries are included in the scope of consolidation from the date that control commences, based on
the fair value of those identifiable assets and liabilities at the acquisition date.
5.6.3 Disposal of subsidiaries
When the Group loses control over a subsidiary, any resulting disposal gains or losses are recognised
as investment income for the current period. The remaining equity investment is re-measured at its fair
value at the date when control is lost, any resulting gains or losses are also recognised as investment
income for the current period.
When the Group loses control of a subsidiary in multiple transactions in which it disposes of its
long-term equity investment in the subsidiary in stages, the following are considered to determine
whether the Group should account for the multiple transactions as a bundled transaction:
- arrangements are entered into at the same time or in contemplation of each other;
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
- arrangements work together to achieve an overall commercial effect;
- the occurrence of one arrangement is dependent on the occurrence of at least one other
arrangement;
- one arrangement considered on its own is not economically justified, but it is economically
justified when considered together with other arrangements.
If each of the multiple transactions does not form part of a bundled transaction, the transactions
conducted before the loss of control of the subsidiary are accounted for in accordance with the
accounting policy for partial disposal of equity investment in subsidiaries where control is retained.
If each of the multiple transactions forms part of a bundled transaction which eventually results in the
loss of control in the subsidiary, these multiple transactions are accounted for as a single transaction.
In the consolidated financial statements, the difference between the consideration received and the
corresponding proportion of the subsidiary’s net assets (calculated continuously from the acquisition
date) in each transaction prior to the loss of control shall be recognised in other comprehensive income
and transferred to profit or loss when the parent eventually loses control of the subsidiary.
5.6.4 Changes in non-controlling interests
Where the Company acquires a non-controlling interest from a subsidiary’s non-controlling
shareholders or disposes of a portion of an interest in a subsidiary without a change in control, the
difference between the proportion interests of the subsidiary’s net assets being acquired or disposed
and the amount of the consideration paid or received is adjusted to the capital reserve (share premium)
in the consolidated balance sheet, with any excess adjusted to retained earnings.
5.7 Determination standard of cash and cash equivalents
Cash and cash equivalents comprise cash on hand, demand deposit, and short-term highly liquid
investments which are readily convertible into known amount of cash with an insignificant risk of
changes in value.
5.8 Foreign currency transaction and foreign currency statement translation
When the Group receives capital in foreign currencies from investors, the capital is translated to
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Renminbi at the spot exchange rate at the date of the receipt. Other foreign currency transactions are,
on initial recognition, translated to Renminbi at the spot exchange rates.
Monetary items denominated in foreign currencies are translated to Renminbi at the spot exchange rate
at the balance sheet date. The resulting exchange differences are generally recognised in profit or loss,
unless they arise from the re-translation of the principal and interest of specific borrowings for the
acquisition and construction of qualifying assets. Non-monetary items that are measured at historical
cost in foreign currencies are translated to Renminbi using the exchange rate at the transaction date.
In translating the financial statements of a foreign operation, assets and liabilities of foreign operation
are translated to Renminbi at the spot exchange rate at the balance sheet date. Equity items, excluding
retained earnings and the translation differences in other comprehensive income, are translated to
Renminbi at the spot exchange rates at the transaction dates. Income and expenses in the income
statement are translated to Renminbi at the spot exchange rates at the transaction dates. The resulting
translation differences are recognised in other comprehensive income. The translation differences
accumulated in other comprehensive income with respect to a foreign operation are transferred to
profit or loss in the period when the foreign operation is disposed.
5.9 Financial instruments
Financial instruments include cash at bank and on hand, investments in debt and equity securities other
than those classified as long-term equity investments, receivables, payables, loans and borrowings and
share capital.
5.9.1 Recognition and initial measurement of financial assets and financial liabilities
A financial asset and financial liability is recognised in the balance sheet when the Group becomes a
party to the contractual provisions of a financial instrument.
A financial assets (unless it is a trade receivable without a significant financing component) and
financial liabilities is measured initially at fair value. For financial assets and financial liabilities at fair
value through profit or loss, any related directly attributable transaction costs are charged to profit or
loss; for other categories of financial assets and financial liabilities, any related directly attributable
transaction costs are included in their initial costs. Accounts receivable containing no significant
financing component are measured initially at transaction prices determined by the accounting policies
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
set out in Note 5.22.
5.9.2 Classification and subsequent measurement of financial assets
(a) Classification of financial assets
The classification of financial assets is generally based on the business model in which a financial
asset is managed and its contractual cash flow characteristics. On initial recognition, a financial asset
is classified as measured at amortised cost, at fair value through other comprehensive income
(“FVOCI”), or at fair value through profit or loss (“FVTPL”).
Financial assets are not reclassified subsequent to their initial recognition unless the Group changes its
business model for managing financial assets in which case all affected financial assets are reclassified
on the first day of the first reporting period following the change in the business model.
A financial asset is measured at amortised cost if it meets both of the following conditions and is not
designated as at FVTPL:
- it is held within a business model whose objective is to hold assets to collect contractual cash
flows; and
- its contractual terms give rise on specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding.
A debt investment is measured at FVOCI if it meets both of the following conditions and is not
designated as at FVTPL:
- it is held within a business model whose objective is achieved by both collecting contractual cash
flows and selling financial assets; and
- its contractual terms give rise on specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding.
On initial recognition of an equity investment that is not held for trading, the Group may irrevocably
elect to present subsequent changes in the investment’s fair value in other comprehensive income. This
election is made on an investment-by-investment basis. The instrument meets the definition of equity
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
from the perspective of the issuer.
All financial assets not classified as measured at amortised cost or FVOCI as described above are
measured at FVTPL. On initial recognition, the Group may irrevocably designate a financial asset that
otherwise meets the requirements to be measured at amortised cost or at FVOCI as at FVTPL if doing
so eliminates or significantly reduces an accounting mismatch that would otherwise arise.
The business model refers to how the Group manages its financial assets in order to generate cash
flows. That is, the Group’s business model determines whether cash flows will result from collecting
contractual cash flows, selling financial assets or both. The Group determines the business model for
managing the financial assets according to the facts and based on the specific business objective for
managing the financial assets determined by the Group’s key management personnel.
In assessing whether the contractual cash flows are solely payments of principal and interest, the
Group considers the contractual terms of the instrument. For the purposes of this assessment,
‘principal’ is defined as the fair value of the financial asset on initial recognition. ‘Interest’ is defined
as consideration for the time value of money and for the credit risk associated with the principal
amount outstanding during a particular period of time and for other basic lending risks and costs, as
well as a profit margin. The Group also assesses whether the financial asset contains a contractual term
that could change the timing or amount of contractual cash flows such that it would not meet this
condition.
(b) Subsequent measurement of financial assets
- Financial assets at FVTPL
These financial assets are subsequently measured at fair value. Net gains and losses, including any
interest or dividend income, are recognised in profit or loss unless the financial assets are part of a
hedging relationship.
- Financial assets at amortised cost
These assets are subsequently measured at amortised cost using the effective interest method. A gain
or loss on a financial asset that is measured at amortised cost and is not part of a hedging relationship
shall be recognised in profit or loss when the financial asset is derecognised, through the amortisation
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
process or in order to recognise impairment gains or losses.
- Debt investments at FVOCI
These assets are subsequently measured at fair value. Interest income calculated using the effective
interest method, impairment and foreign exchange gains and losses are recognised in profit or loss.
Other net gains and losses are recognised in other comprehensive income. On derecognition, gains and
losses accumulated in other comprehensive income are reclassified to profit or loss.
- Equity investments at FVOCI
These assets are subsequently measured at fair value. Dividends are recognised as income in profit or
loss. Other net gains and losses are recognised in other comprehensive income. On derecognition,
gains and losses accumulated in other comprehensive income are reclassified to retained earnings.
5.9.3 Classification and subsequent measurement of financial liabilities
Financial liabilities are classified as measured at FVTPL or amortised cost by the Group.
- Financial liabilities at FVTPL
A financial liability is classified as at FVTPL if it is classified as held-for-trading (including derivative
financial liability) or it is designated as such on initial recognition.
Financial liabilities at FVTPL are subsequently measured at fair value and net gains and losses,
including any interest expense, are recognised in profit or loss, unless the financial liabilities are part
of a hedging relationship.
- Financial liabilities at amortised cost
These financial liabilities are subsequently measured at amortised cost using the effective interest
method.
5.9.4 Offsetting
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Financial assets and financial liabilities are generally presented separately in the balance sheet, and are
not offset. However, a financial asset and a financial liability are offset and the net amount is presented
in the balance sheet when both of the following conditions are satisfied:
- The Group currently has a legally enforceable right to set off the recognised amounts；
- The Group intends either to settle on a net basis, or to realise the financial asset and settle the
financial liability simultaneously.
5.9.5 Derecognition of financial assets and financial liabilities
Financial asset is derecognised when one of the following conditions is met:
- the Group’s contractual rights to the cash flows from the financial asset expire;
- the financial asset has been transferred and the Group transfers substantially all of the risks and
rewards of ownership of the financial asset; or；
- the financial asset has been transferred, although the Group neither transfers nor retains
substantially all of the risks and rewards of ownership of the financial asset, it does not retain control
over the transferred asset.
Where a transfer of a financial asset in its entirety meets the criteria for derecognition, the difference
between the two amounts below is recognised in profit or loss:
- the carrying amount of the financial asset transferred measured at the date of derecognition;
- the sum of the consideration received from the transfer and, when the transferred financial asset is
a debt investment at FVOCI, any cumulative gain or loss that has been recognised directly in other
comprehensive income for the part derecognised.
The Group derecognises a financial liability (or part of it) only when its contractual obligation (or part
of it) is extinguished.
5.9.6 Impairment
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
The Group recognises loss allowances for expected credit loss (ECL) on:
- financial assets measured at amortised cost;
- financial investments at fair value through other comprehensive income
Financial assets measured at fair value, including debt investments or equity securities at FVPL, equity
securities designated at FVOCI and derivative financial assets, are not subject to the ECL assessment.
Measurement of ECLs
ECLs are a probability-weighted estimate of credit losses. Credit losses are measured as the present
value of all cash shortfalls (i.e. the difference between the cash flows due to the entity in accordance
with the contract and the cash flows that the Group expects to receive).
The maximum period considered when estimating ECLs is the maximum contractual period (including
extension options) over which the Group is exposed to credit risk.
Lifetime ECLs are the ECLs that result from all possible default events over the expected life of a
financial instrument.
12-month ECLs are the portion of ECLs that result from default events that are possible within the 12
months after the balance sheet date (or a shorter period if the expected life of the instrument is less
than 12 months).
For accounts receivable, loss allowance always measured at an amount equal to lifetime ECLs. ECLs
on these financial assets are estimated using a provision matrix based on the Group’s historical credit
loss experience, adjusted for factors that are specific to the debtors and an assessment of both the
current and forecast general economic conditions at the balance sheet date.
For assets other than accounts receivable that meet one of the following conditions, loss allowance are
measured at an amount equal to 12-month ECLs. For all other financial instruments, the Group
recognises a loss allowance equal to lifetime ECLs:
- If the financial instrument is determined to have low credit risk at the balance sheet date;
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
- If the credit risk on a financial instrument has not increased significantly since initial recognition.
Financial instruments that have low credit risk
The credit risk on a financial instrument is considered low if the financial instrument has a low risk of
default, the borrower has a strong capacity to meet its contractual cash flow obligations in the near
term and adverse changes in economic and business conditions in the longer term may, but will not
necessarily, reduce the ability of the borrower to fulfil its contractual cash flow obligations.
Significant increases in credit risk
In assessing whether the credit risk of a financial instrument has increased significantly since initial
recognition, the Group compares the risk of default occurring on the financial instrument assessed at
the balance sheet date with that assessed at the date of initial recognition.
When determining whether the credit risk of a financial asset has increased significantly since initial
recognition and when estimating ECL, the Group considers reasonable and supportable information
that is relevant and available without undue cost or effort, including forward-looking information. In
particular, the following information is taken into account:
- failure to make payments of principal or interest on their contractually due dates;
- an actual or expected significant deterioration in a financial instrument’s external or internal
credit rating (if available);
- an actual or expected significant deterioration in the operating results of the debtor; and
- existing or forecast changes in the technological, market, economic or legal environment that
have a significant adverse effect on the debtor’s ability to meet its obligation to the Group.
Depending on the nature of the financial instruments, the assessment of a significant increase in credit
risk is performed on either an individual basis or a collective basis. When the assessment is performed
on a collective basis, the financial instruments are grouped based on shared credit risk characteristics,
such as past due status and credit risk ratings.
The Group assumes that the credit risk on a financial asset has increased significantly if it is more than
30 days past due.
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Credit-impaired financial assets
At each balance sheet date, the Group assesses whether financial assets carried at amortised cost and
debt investments at FVOCI are credit-impaired. A financial asset is ‘credit-impaired’ when one or
more events that have a detrimental impact on the estimated future cash flows of the financial asset
have occurred. Evidence that a financial asset is credit-impaired includes the following observable
data:
- significant financial difficulty of the borrower or issuer;
- a breach of contract, such as a default or delinquency in interest or principal payments;
- for economic or contractual reasons relating to the borrower’s financial difficulty, the Group
having granted to the borrower a concession that would not otherwise consider;
- it is probable that the borrower will enter bankruptcy or other financial reorganisation; or
- the disappearance of an active market for that financial asset because of financial difficulties.
Presentation of allowance for ECL
ECLs are remeasured at each balance sheet date to reflect changes in the financial instrument’s credit
risk since initial recognition. Any change in the ECL amount is recognised as an impairment gain or
loss in profit or loss. The Group recognises an impairment gain or loss for all financial instruments
with a corresponding adjustment to their carrying amount through a loss allowance account, except for
debt investments that are measured at FVOCI, for which the loss allowance is recognised in other
comprehensive income.
Write-off
The gross carrying amount of a financial asset is written off (either partially or in full) to the extent
that there is no realistic prospect of recovery. A write-off constitutes a derecognition event. This is
generally the case when the Group determines that the debtor does not have assets or sources of
income that could generate sufficient cash flows to repay the amounts subject to the write-off.
However, financial assets that are written off could still be subject to enforcement activities in order to
comply with the Group’s procedures for recovery of amounts due.
Subsequent recoveries of an asset that was previously written off are recognised as a reversal of
impairment in profit or loss in the period in which the recovery occurs.
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
5.9.7 Equity instrument
The consideration received from the issuance of equity instruments net of transaction costs is
recognised in shareholders’ equity. Consideration and transaction costs paid by the Company for
repurchasing self-issued equity instruments are deducted from shareholders’ equity.
When the Company repurchases its own shares, those shares are treated as treasury shares. All
expenditure relating to the repurchase is recorded in the cost of the treasury shares, with the
transaction recording in the share register. Treasury shares are excluded from profit distributions and
are presented as a deduction under shareholders’ equity in the balance sheet.
5.10 Inventories
5.10.1 Classification and cost
Inventories include raw materials, work in progress and reusable materials. Inventories are initially
measured at cost. Cost of inventories comprises all costs of purchase, costs of conversion and other
expenditure incurred in bringing the inventories to their present location and condition. In addition to
the purchase cost of raw materials, work in progress and finished goods include direct labour costs and
an appropriate allocation of production overheads.
Agricultural products harvested are reported in accordance with the CAS No.1 - Inventories.
5.10.2 Measurement method of cost of inventories
Cost of inventories is calculated using the weighted average method.
Consumables including low-value consumables and packaging materials are amortised when they are
used. The amortisation charge is included in the cost of the related assets or recognised in profit or loss
for the current period.
5.10.3 Basis for determining the net realisable value and method for provision for
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
obsolete inventories
At the balance sheet date, inventories are carried at the lower of cost and net realisable value.
Net realisable value is the estimated selling price in the ordinary course of business less the estimated
costs of completion and the estimated costs necessary to make the sale and relevant taxes. The net
realisable value of materials held for use in the production is measured based on the net realisable
value of the finished goods in which they will be incorporated. The net realisable value of the
inventory held to satisfy sales or service contracts is measured based on the contract price, to the
extent of the quantities specified in sales contracts, and the excess portion of inventories is measured
based on general selling prices.
Any excess of the cost over the net realisable value of each item of inventories is recognised as a
provision for impairment, and is recognised in profit or loss.
5.10.4 Inventory count system
The Group maintains a perpetual inventory system.
5.11 Long-term equity investments
5.11.1 Investment cost of long-term equity investments
(a) Long-term equity investments acquired through a business combination
- The initial cost of a long-term equity investment acquired through a business combination
involving entities under common control is the Company’s share of the carrying amount of the
subsidiary’s equity in the consolidated financial statements of the ultimate controlling party at the
combination date. The difference between the initial investment cost and the carrying amount of the
consideration given is adjusted to the share premium in the capital reserve, with any excess adjusted to
retained earnings. For a long-term equity investment in a subsidiary acquired through a business
combination achieved in stages which do not form a bundled transaction and involving entities under
common control, the Company determines the initial cost of the investment in accordance with the
above policies. The difference between this initial cost and the sum of the carrying amount of
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
previously-held investment and the consideration paid for the shares newly acquired is adjusted to
capital premium in the capital reserve, with any excess adjusted to retained earnings.
- For a long-term equity investment obtained through a business combination not involving
enterprises under common control, the initial cost comprises the aggregate of the fair value of assets
transferred, liabilities incurred or assumed, and equity securities issued by the Company, in exchange
for control of the acquiree. For a long-term equity investment obtained through a business
combination not involving entities under common control and achieved through multiple transactions
in stages which do not form a bundled transaction, the initial cost comprises the carrying amount of
the previously-held equity investment in the acquiree immediately before the acquisition date, and the
additional investment cost at the acquisition date.
(b) Long-term equity investments acquired other than through a business combination
- A long-term equity investment acquired other than through a business combination is initially
recognised at the amount of cash paid if the Group acquires the investment by cash, or at the fair value
of the equity securities issued if an investment is acquired by issuing equity securities.
5.11.2 Subsequent measurement of long-term equity investment
(a) Investments in subsidiaries
In the Company’s separate financial statements, long-term equity investments in subsidiaries are
accounted for using the cost method unless the investment is classified as held for sale. Except for
cash dividends or profit distributions declared but not yet distributed that have been included in the
price or consideration paid in obtaining the investments, the Company recognises its share of the cash
dividends or profit distributions declared by the investee as investment income for the current period.
The investments in subsidiaries are stated in the balance sheet at cost less accumulated impairment
losses.
For the impairment of the investments in subsidiaries, refer to Note 5.20.
In the Group’s consolidated financial statements, subsidiaries are accounted for in accordance with the
policies described in Note 5.6.
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
(b) Investments in joint ventures
A joint venture is an arrangement whereby the Group and other parties have joint control and rights to
the net assets of the arrangement.
A long-term equity investment in a joint venture is accounted for using the equity method for
subsequent measurement, unless the investment is classified as held for sale.
The accounting treatments under the equity method adopted by the Group are as follows:
- Where the initial cost of a long-term equity investment exceeds the Group’s interest in the fair
value of the investee’s identifiable net assets at the date of acquisition, the investment is initially
recognised at cost. Where the initial investment cost is less than the Group’s interest in the fair value
of the investee’s identifiable net assets at the date of acquisition, the investment is initially recognised
at the investor’s share of the fair value of the investee’s identifiable net assets, and the difference is
recognised in profit or loss.
- After the acquisition of the investment, the Group recognises its share of the investee’s profit or
loss and other comprehensive income as investment income or losses and other comprehensive income
respectively, and adjusts the carrying amount of the investment accordingly. Once the investee
declares any cash dividends or profit distributions, the carrying amount of the investment is reduced
by the amount attributable to the Group. Changes in the Group’s share of the investee’s owners’ equity,
other than those arising from the investee’s net profit or loss, other comprehensive income or profit
distribution (referred to as “other changes in owners’ equity”), is recognised directly in the Group’s
equity, and the carrying amount of the investment is adjusted accordingly.
- In calculating its share of the investee’s net profits or losses, other comprehensive income and
other changes in owners’ equity, the Group recognises investment income and other comprehensive
income after making appropriate adjustments to align the accounting policies or accounting periods
with those of the Group based on the fair value of the investee’s identifiable net assets at the date of
acquisition. Unrealised profits and losses resulting from transactions between the Group and its
associates or joint ventures are eliminated to the extent of the Group’s interest in the associates or joint
ventures. Unrealised losses resulting from transactions between the Group and its associates or joint
ventures are eliminated in the same way as unrealised gains but only to the extent that there is no
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
impairment.
- The Group discontinues recognising its share of further losses of the investee after the carrying
amount of the long-term equity investment and any long-term interest that in substance forms part of
the Group’s net investment in the associate is reduced to zero, except to the extent that the Group has
an obligation to assume additional losses. If the joint venture subsequently reports net profits, the
Group resumes recognising its share of those profits only after its share of the profits equals the share
of losses not recognised.
For the impairment of the investments in joint ventures and associates, refer to Note 5.20.
5.11.3 Criteria for determining the existence of joint control over an investee
Joint control is the contractually agreed sharing of control of an arrangement, which exists only when
decisions about the relevant activities (activities with significant impact on the returns of the
arrangement) require the unanimous consent of the parties sharing control.
The following factors are usually considered when assessing whether the Group can exercise joint
control over an investee:
- Whether no single participant party is in a position to control the investee’s related activities
unilaterally;
- Whether strategic decisions relating to the investee’s related activities require the unanimous
consent of all participant parties that sharing of control.
Significant influence is the power to participate in the financial and operating policy decisions of an
investee but does not have control or joint control over those policies.
5.12 Investment properties
Investment properties are properties held either to earn rental income or for capital appreciation or for
both. Investment properties are accounted for using the cost model and stated in the balance sheet at
cost less accumulated depreciation, amortisation and impairment losses, and adopts a depreciation or
amortisation policy for the investment property which is consistent with that for buildings or land use
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
rights, unless the investment property is classified as held for sale. For the impairment of the
investment properties, refer to Note 5.20.
Estimated useful life Residual value rate
Category Depreciation rate (%)
(years) (%)
Plant and buildings 20-40 years 0 - 5% 2.4%-5.0%
5.13 Fixed assets
5.13.1 Recognition of fixed assets
Fixed assets represent the tangible assets held by the Group for use in production of goods, supply of
services, for rental or for administrative purposes with useful lives over one accounting year.
The cost of a purchased fixed asset comprises the purchase price, related taxes, and any directly
attributable expenditure for bringing the asset to working condition for its intended use. The cost of
self-constructed assets is measured in accordance with the policy set out in Note 5.14.
Where the parts of an item of fixed assets have different useful lives or provide benefits to the Group
in a different pattern, thus necessitating use of different depreciation rates or methods, each part is
recognised as a separate fixed asset.
Any subsequent costs including the cost of replacing part of an item of fixed assets are recognised as
assets when it is probable that the economic benefits associated with the costs will flow to the Group,
and the carrying amount of the replaced part is derecognised. The costs of the day-to-day maintenance
of fixed assets are recognised in profit or loss as incurred.
Fixed assets are stated in the balance sheet at cost less accumulated depreciation and impairment
losses.
5.13.2 Depreciation of fixed assets
The cost of a fixed asset, less its estimated residual value and accumulated impairment losses, is
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
depreciated using the straight-line method over its estimated useful life, unless the fixed asset is
classified as held for sale.
The estimated useful lives, residual value rates and depreciation rates of each class of fixed assets are
as follows:
Estimated useful life Residual value rate
Class Depreciation rate (%)
(years) (%)
Plant and buildings 20-40 years 0 - 5% 2.4%-5.0%
Machinery equipment 5-30 years 0 - 5% 3.2%-20.0%
Motor vehicles 4-12 years 0 - 5% 7.9%-25.0%
Useful lives, estimated residual values and depreciation methods are reviewed at least at each
year-end.
5.13.3 For the impairment of the fixed assets, refer to Note 5.20.
5.13.4 Disposal of fixed assets
The carrying amount of a fixed asset is derecognised:
- when the fixed asset is holding for disposal; or
- when no future economic benefit is expected to be generated from its use or disposal.
Gains or losses arising from the retirement or disposal of an item of fixed asset are determined as the
difference between the net disposal proceeds and the carrying amount of the item, and are recognised
in profit or loss on the date of retirement or disposal.
5.14 Construction in progress
The cost of self-constructed assets includes the cost of materials, direct labour, capitalised borrowing
costs, and any other costs directly attributable to bringing the asset to working condition for its
intended use.
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A self-constructed asset is classified as construction in progress and transferred to fixed asset when it
is ready for its intended use. No depreciation is provided against construction in progress.
Construction in progress is stated in the balance sheet at cost less accumulated impairment losses (see
Note 5.20).
5.15 Borrowing costs
Borrowing costs incurred directly attributable to the acquisition, and construction or production of a
qualifying asset are capitalised as part of the cost of the asset. Other borrowing costs are recognised as
financial expenses when incurred.
During the capitalisation period, the amount of interest (including amortisation of any discount or
premium on borrowing) to be capitalised in each accounting period is determined as follows:
- Where funds are borrowed specifically for the acquisition and construction or production of a
qualifying asset, the amount of interest to be capitalised is the interest expense calculated using
effective interest rates during the period less any interest income earned from depositing the borrowed
funds or any investment income on the temporary investment of those funds before being used on the
asset.
- To the extent that the Group borrows funds generally and uses them for the acquisition and
construction or production of a qualifying asset, the amount of borrowing costs eligible for
capitalisation is determined by applying a capitalisation rate to the weighted average of the excess
amounts of cumulative expenditure on the asset over the above amounts of specific borrowings. The
capitalisation rate is the weighted average of the interest rates applicable to the general-purpose
borrowings.
The effective interest rate is determined as the rate that exactly discounts estimated future cash flow
through the expected life of the borrowing or, when appropriate, a shorter period to the initially
recognised amount of the borrowings.
During the capitalisation period, exchange differences related to the principal and interest on a
specific-purpose borrowing denominated in foreign currency are capitalised as part of the cost of the
qualifying asset. The exchange differences related to the principal and interest on foreign currency
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
borrowings other than a specific-purpose borrowing are recognised as a financial expense when
incurred.
The capitalisation period is the period from the date of commencement of capitalisation of borrowing
costs to the date of cessation of capitalisation, excluding any period over which capitalisation is
suspended. Capitalisation of borrowing costs commences when expenditure for the asset is being
incurred, borrowing costs are being incurred and activities of acquisition, construction or production
that are necessary to prepare the asset for its intended use are in progress, and ceases when the assets
become ready for their intended use. Capitalisation of borrowing costs should cease when the
qualifying asset being constructed or produced has reached its expected usable or saleable condition.
Capitalisation of borrowing costs is suspended when the acquisition, construction or production
activities are interrupted abnormally for a period of more than three months.
5.16 Biological assets
The biological assets of the Group are productive biological assets.
Bearer biological assets are those that are held for the purposes of producing agricultural produce,
rendering of services or rental. Bearer biological assets in the Group are vines. Bearer biological assets
are initially measured at cost. The cost of self-grown or self-bred bearer biological assets represents
the necessary directly attributable expenditure incurred before satisfying the expected production and
operating purpose, including capitalised borrowing costs.
Bearer biological assets, after reaching the expected production and operating purpose, are depreciated
using the straight-line method over its estimated useful life. The estimated useful lives, estimated net
residual value rates and depreciation rates of bearer biological assets are as follows:
Estimated net residual rate
Category Useful life (years) Annual depreciation rate (%)
(%)
Vines 20 years 0% 5.0%
The Group evaluates the useful life and expected net salvage value by considering the normal
producing life of the bearer biological assets.
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Useful lives, estimated residual values and depreciation methods of bearer biological assets are
reviewed at least at each year-end. Any changes should be treated as changes in accounting estimates.
For a bearer biological asset that has been sold, damaged, dead or destroyed, any difference between
the disposal proceeds and the carrying amount of the asset (after tax deduction) should be recognised
in profit or loss for the period in which it arises.
5.17 Intangible assets
Intangible assets are stated in the balance sheet at cost less accumulated amortization (where the
estimated useful life is finite) and impairment losses (see Note 5.20). For an intangible asset with finite
useful life, its cost estimated less residual value and accumulated impairment losses is amortised on
the straight-line method over its estimated useful life, unless the intangible asset is classified as held
for sale.
The respective amortisation periods for intangible assets are as follows:
Item Amortisation period (years)
Land use rights 40-50 years
Software licenses 5-10 years
Trademark 10 years
An intangible asset is regarded as having an indefinite useful life and is not amortised when there is no
foreseeable limit to the period over which the asset is expected to generate economic benefits for the
Group. At the balance sheet date, the Group had intangible assets with infinite useful lives including
the land use rights and trademarks. Land use rights with infinite useful lives are permanent land use
rights with permanent ownership held by the Group under the relevant Chile and Australian laws
arising from the Group’s acquisition of Via Indómita, S.A., Via Dos Andes, S.A., and Bodegas Santa
Alicia SpA. (collectively referred to as the "Chile Indomita Wine Group"), and the acquisition of
Kilikanoon Estate Pty Ltd.( hereinafter referred to as the "Australia Kilikanoon Estate"), therefore
there was no amortisation. The right to use trademark refers to the trademark held by the Group arising
from the acquisition of the Chile Indomita Wine Group and the Australia Kilikanoon Estate with
infinite useful lives. The valuation of trademark was based on the trends in the market and competitive
environment, product cycle, and managing long-term development strategy. Those bases indicated the
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
trademark will provide net cash flows to the Group within an uncertain period. The useful life is
indefinite as it was hard to predict the period that the trademark would bring economic benefits to the
Group.
5.18 Goodwill
The initial cost of goodwill represents the excess of cost of acquisition over the acquirer’s interest in
the fair value of the identifiable net assets of the acquiree under a business combination not involving
entities under common control.
Goodwill is not amortised and is stated in the balance sheet at cost less accumulated impairment losses
(see Note 5.20). On disposal of an asset group or a set of asset groups, any attributable goodwill is
written off and included in the calculation of the profit or loss on disposal.
5.19 Long-term deferred expenses
Long-term deferred expenses are amortised using a straight-line method within the benefit period. The
respective amortisation periods for such expenses are as follows:
Item Amortisation period
Land requisition fee 50 years
Land lease fee 50 years
Greening fee 5-20 years
Renovation fee 3-5 years
Others 3 years
5.20 Impairment of assets other than inventories and financial assets
The carrying amounts of the following assets are reviewed at each balance sheet date based on internal
and external sources of information to determine whether there is any indication of impairment:
- fixed assets
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
- construction in progress
- intangible assets
- Bearer biological assets
- investment properties measured using a cost model
- long-term equity investments
- goodwill
- long-term deferred expenses, etc.
If any indication exists, the recoverable amount of the asset is estimated. In addition, the Group
estimates the recoverable amounts of goodwill and intangible assets with infinite useful lives at each
year-end, irrespective of whether there is any indication of impairment. Goodwill is allocated to each
asset group, or set of asset groups, that is expected to benefit from the synergies of the combination for
the purpose of impairment testing.
The recoverable amount of an asset (or asset group, set of asset groups) is the higher of its fair value
(see Note 5.21) less costs to sell and its present value of expected future cash flows.
An asset group is composed of assets directly related to cash-generation and is the smallest identifiable
group of assets that generates cash inflows that are largely independent of the cash inflows from other
assets or asset groups.
The present value of expected future cash flows of an asset is determined by discounting the future
cash flows, estimated to be derived from continuing use of the asset and from its ultimate disposal, to
their present value using an appropriate pre-tax discount rate.
An impairment loss is recognised in profit or loss when the recoverable amount of an asset is less than
its carrying amount. A provision for impairment of the asset is recognised accordingly. Impairment
losses related to an asset group or a set of asset groups are allocated first to reduce the carrying amount
of any goodwill allocated to the asset group or set of asset groups, and then to reduce the carrying
amount of the other assets in the asset group or set of asset groups on a pro rata basis. However, such
allocation would not reduce the carrying amount of an asset below the highest of its fair value less
costs to sell (if measurable), its present value of expected future cash flows (if determinable) and zero.
Once an impairment loss is recognised, it is not reversed in a subsequent period.
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
5.21 Fair value measurement
Unless otherwise specified, the Group measures fair value as follows:
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date.
When measuring fair value, the Group takes into account the characteristics of the particular asset or
liability (including the condition and location of the asset and restrictions, if any, on the sale or use of
the asset) that market participants would consider when pricing the asset or liability at the
measurement date, and uses valuation techniques that are appropriate in the circumstances and for
which sufficient data and other information are available to measure fair value. Valuation techniques
mainly include the market approach, the income approach and the cost approach.
5.22 Revenue
The Group recognizes the revenue upon fulfillment of its performance obligations in the contract, that
is, the client obtains control right over the relevant goods or services.
If there are two or more performance obligations under the contact, which shall be fulfilled, the Group
will apportion the transaction price to various individual performance obligations in accordance with
the relative proportion of separate selling prices of various goods or services under these performance
obligations on the commencement date of the contract, and measure and recognize the revenue in
accordance with the transaction prices apportioned to various individual performance obligations. For
contracts with quality assurance clauses, the Group analyzes the nature of the quality assurance
provided. If quality assurance provides a separate service in addition to ensuring to the client that the
goods sold meet the established standards, the Group will treat it as an individual performance
obligation. Otherwise, the Group conducts accounting treatment in accordance with the Accounting
Standards for Business Enterprises No. 13 - Contingencies.
The transaction price refers to the amount of consideration that the Group expects to be entitled to
receive due to the transfer of goods or services to the client, excluding payments received on behalf of
third parties. The transaction price recognized by the Group does not exceed the amount at which the
accumulated recognized revenue will most likely not undergo a significant reversal when the relevant
uncertainty is eliminated. It is expected that the money returned to the client will be regarded as a
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
return liability and not included in the transaction price. In the event that there is a significant
financing part in the contract, the Group determines the transaction price based on the amount payable
in cash when the client obtains control right over the relevant goods or services. The difference
between the transaction price and the contract consideration shall be amortized by the effective interest
method during the contract period. From the day of the enforcement of the contract, the Group expects
that the interval between the client's acquisition of control right over the goods or services and the
client's payment of the price will not exceed one year, regardless of the significant financing part in the
contract.
If the Group meets one of the following conditions, the fulfillment of its performance obligations in a
certain period will be deemed, or the fulfillment of its performance obligations at a certain time point
will be deemed:
- The client obtains and consumes the economic benefits while the Group fulfills the performance
obligation;
- The client manages to control the goods in process while the Group fulfills the performance
obligation.
- Goods produced during the performance period have irreplaceable purposes and the Group is
entitled to charge money for the performance accumulated and has been finished until the current time
within the whole contract period.
For any performance obligations fulfilled in a certain period, the Group will recognize revenue within
the certain period in accordance with the performance progress. If the performance progress cannot be
determined reasonably and costs incurred are expected to be compensated of the Group, the revenue
will be ascertained according to the costs incurred until the performance progress is determined
reasonably.
In terms of performance obligations fulfilled at a certain time point, the Group will recognize revenue
when the client gains control right over the relevant goods or services. When it comes to determining
whether a client has acquired the control right over goods or services, the Group will consider the
following conditions:
- The Group has the current right to receive payment for the goods or services;
- The Group has transferred the goods in kind to the client;
- The Group has transferred the legal ownership of the product or the main risks and rewards of
ownership to the client;
- The client has accepted the goods or services, etc.
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
The Group has transferred the goods or services to the client and thus has the right to receive
corresponding consideration (and the right is dependable on factors other than time lapses) as contract
asset, which is subject to provision of impairment on the basis of expected credit loss. The right
enjoyed by the Group (only depends on time lapses) to receive consideration unconditionally from the
client shall be presented under account receivables. The Group presents the obligation of transferring
goods or services for the client due to the consideration received or receivable as contract liabilities.
5.23 Employee benefits
5.23.1 Short-term employee benefits
Employee wages or salaries, bonuses, social security contributions such as medical insurance, work
injury insurance, maternity insurance and housing fund, measured at the amount incurred or accured at
the applicable benchmarks and rates, are recognised as a liability as the employee provides services,
with a corresponding charge to profit or loss or included in the cost of assets where appropriate.
5.23.2 Post-employment benefits – defined contribution plans
Pursuant to the relevant laws and regulations of the People’s Republic of China, the Group participated
in a defined contribution basic pension insurance plan in the social insurance system established and
managed by government organisations. The Group makes contributions to basic pension insurance
plans based on the applicable benchmarks and rates stipulated by the government. Basic pension
insurance contributions payable are recognised as a liability as the employee provides services, with a
corresponding charge to profit or loss or included in the cost of assets where appropriate.
5.23.3 Termination benefits
When the Group terminates the employment with employees before the employment contracts expire,
or provides compensation under an offer to encourage employees to accept voluntary redundancy, a
provision is recognised with a corresponding expense in profit or loss at the earlier of the following
dates:
- When the Group cannot unilaterally withdraw the offer of termination benefits because of an
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
employee termination plan or a curtailment proposal;
- When the Group has a formal detailed restructuring plan involving the payment of termination
benefits and has raised a valid expectation in those affected that it will carry out the restructuring by
starting to implement that plan or announcing its main features to those affected by it.
5.24 Government grants
Government grants are non-reciprocal transfers of monetary or non-monetary assets from the
government to the Group except for capital contributions from the government in the capacity as an
investor in the Group.
A government grant is recognised when there is reasonable assurance that the grant will be received
and that the Group will comply with the conditions attaching to the grant.
If a government grant is in the form of a transfer of a monetary asset, it is measured at the amount
received or receivable. If a government grant is in the form of a transfer of a non-monetary asset, it is
measured at fair value.
Government grants related to assets are grants whose primary condition is that the Group qualifying
for them should purchase, construct or otherwise acquire long-term assets. Government grants related
to income are grants other than those related to assets. A government grant related to an asset is
recognised as deferred income and amortised over the useful life of the related asset on a reasonable
and systematic manner as other income or non-operating income. A grant that compensates the
Company for expenses or losses to be incurred in the future is recognised as deferred income, and
included in other income or non-operating income in the periods in which the expenses or losses are
recognised, or included in other income or non-operating income directly.
5.25 Income tax
Current tax and deferred tax are recognised in profit or loss except to the extent that they relate to a
business combination or items recognised directly in equity (including other comprehensive income).
Current tax is the expected tax payable calculated at the applicable tax rate on taxable income for the
year, plus any adjustment to tax payable in respect of previous years.
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
At the balance sheet date, current tax assets and liabilities are offset only if the Group has a legally
enforceable right to set them off and also intends either to settle on a net basis or to realise the asset
and settle the liability simultaneously.
Deferred tax assets and deferred tax liabilities arise from deductible and taxable temporary differences
respectively, being the differences between the carrying amounts of assets and liabilities for financial
reporting purposes and their tax bases, which include the deductible losses and tax credits carried
forward to subsequent periods. Deferred tax assets are recognised to the extent that it is probable that
future taxable profits will be available against which deductible temporary differences can be utilised.
Deferred tax is not recognised for the temporary differences arising from the initial recognition of
assets or liabilities in a transaction that is not a business combination and that affects neither
accounting profit nor taxable profit (or deductible loss). Deferred tax is not recognised for taxable
temporary differences arising from the initial recognition of goodwill.
At the balance sheet date, deferred tax is measured based on the tax consequences that would follow
from the expected manner of recovery or settlement of the carrying amounts of the assets and
liabilities, using tax rates enacted at the balance sheet date that are expected to be applied in the period
when the asset is recovered or the liability is settled.
The carrying amount of a deferred tax asset is reviewed at each balance sheet date, and is reduced to
the extent that it is no longer probable that the related tax benefits will be utilised. Such reduction is
reversed to the extent that it becomes probable that sufficient taxable profits will be available.
At the balance sheet date, deferred tax assets and deferred tax liabilities are offset if all of the
following conditions are met:
- the taxable entity has a legally enforceable right to offset current tax liabilities and current tax
assets;
- they relate to income taxes levied by the same tax authority on either: the same taxable entity; or
different taxable entities which intend either to settle the current tax liabilities and current tax assets on
a net basis, or to realise the assets and settle the liabilities simultaneously, in each future period in
which significant amounts of deferred tax liabilities or deferred tax assets are expected to be settled or
recovered.
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
5.26 Operating leases and finance leases
A lease is classified as either a finance lease or an operating lease. A finance lease is a lease that
transfers substantially all the risks and rewards incidental to ownership of a leased asset to the lessee,
irrespective of whether the legal title to the asset is eventually transferred. An operating lease is a lease
other than a finance lease.
5.26.1 Operating lease assets
Rental payments under operating leases are recognised as part of the cost of another related asset or as
expenses on a straight-line basis over the lease term. Contingent rental payments are expensed as
incurred.
5.26.2 Assets leased out under operating leases
Fixed assets leased out under operating leases, except for investment properties (see Note 5.12), are
depreciated in accordance with the Group’s depreciation policies described in Note 5.13.2. Impairment
losses are recognised in accordance with the accounting policy described in Note 5.20. Income derived
from operating leases is recognised in profit or loss using the straight-line method over the lease term.
If initial direct costs incurred in respect of the assets leased out are material, the costs are initially
capitalised and subsequently amortised in profit or loss over the lease term on the same basis as the
lease income. Otherwise, the costs are charged to profit or loss immediately.
5.27 Assets held for sale
The Group classified a non-current asset or disposal group as held for sale when the carrying amount
of a non-current asset or disposal group will be recovered through a sale transaction rather than
through continuing use.
A disposal group refers to a group of assets to be disposed of, by sale or otherwise, together as a whole
in a single transaction and liabilities directly associated with those assets that will be transferred in the
transaction.
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
A non-current asset or disposal group is classified as held for sale when all the following criteria are
met:
- According to the customary practices of selling such asset or disposal group in similar
transactions, the non-current asset or disposal group must be available for immediate sale in their
present condition subject to terms that are usual and customary for sales of such assets or disposal
groups;
- Its sale is highly probable, that is, the Group has made a resolution on a sale plan and has
obtained a firm purchase commitment. The sale is to be completed within one year.
Non-current assets or disposal groups held for sale are stated at the lower of carrying amount and fair
value less costs to sell (except financial assets, deferred tax assets and investment properties
subsequent measured at fair value initially and subsequently. Any excess of the carrying amount over
the fair value less costs to sell is recognised as an impairment loss in profit or loss.
5.28 Profit distributions
Dividends or profit distributions proposed in the profit appropriation plan, which will be approved
after the balance sheet date, are not recognised as a liability at the balance sheet date but are disclosed
in the notes separately.
5.29 Related parties
If a party has the power to control, jointly control or exercise significant influence over another party,
or vice versa, or where two or more parties are subject to common control or joint control from
another party, they are considered to be related parties. Related parties may be individuals or
enterprises. Enterprises with which the Company is under common control only from the State and
that have no other related party relationships are not regarded as related parties.
In addition to the related parties stated above, the Company determines related parties based on the
disclosure requirements of Administrative Procedures on the Information Disclosures of Listed
Companies issued by the CSRC.
5.30 Segment reporting
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
The Group is principally engaged in the production and sales of wine, brandy, and sparkling wine in
China, France, Spain, Chile and Australia. In accordance with the Group's internal organisation
structure, management requirements and internal reporting system, the Group's operation is divided
into four parts: China, Spain, France, Chile and Australia. The management periodically evaluates
segment results, in order to allocate resources and evaluate performances. In 2020, over 89% of
revenue, more than 98% of profit and over 92% of non-current assets derived from China / are located
in China. Therefore the Group does not need to disclose additional segment report information.
5.31 Significant accounting estimates and judgements
The preparation of the financial statements requires management to make estimates and assumptions
that affect the application of accounting policies and the reported amounts of assets, liabilities, income
and expenses. Actual results may differ from these estimates. Estimates as well as underlying
assumptions and uncertainties involved are reviewed on an ongoing basis. Revisions to accounting
estimates are recognised in the period in which the estimate is revised and in any future periods
affected.
5.31.1 Significant accounting estimates
Except for accounting estimates relating to depreciation and amortisation of assets such as investment
properties, fixed assets, bearer biological assets and intangible assets (see Notes 5.12, 13, 16 and 17)
and provision for impairment of various types of assets (see Notes 7.2, 5, 6, 10, 11, 12, 13, 14 and
Notes 17.1 and 3). Other significant accounting estimates are as follows:
(i) Note 7.16 – Recognition of deferred tax asset;
(ii) Note 11. – Fair value measurements of financial instruments.
5.32 Changes in significant accounting policies and accounting estimates
5.32.1 Changes in significant accounting policies
The Group implemented the Accounting Standards for Business Enterprises No. 14 - Revenues revised
by the Ministry of Finance in 2017 on January 1, 2020.
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Accounting Standards for Business Enterprises No. 14 - Revenues (Revision) ("New Revenue
Standards")
The New Revenue Standards replace the original revenue ones. Under the original revenue standards,
the Group used the transfer of risk premium as the criterion for determining the timing of revenue
recognition. The Group's revenue from sales of goods is recognized when the following conditions are
met at the same time: the main risks and rewards of property in the goods have been transferred to the
buyer, the amount of revenue and related costs can be reliably measured, and related economic
benefits are likely to flow into the Group. The Group neither retains the continuing management rights
that are usually associated with ownership, nor does it exercise effective control over the sold goods.
Under the New Revenue Standards, the Group used the transfer of control right as the criterion for
determining the timing of revenue recognition:
- The Group recognizes the revenue upon fulfillment of its performance obligations in the contract,
that is, the client obtains control right over the relevant goods or services. If the Group meets a certain
condition, the fulfillment of its performance obligations in a certain period will be deemed, or the
fulfillment of its performance obligations at a certain time point will be deemed. If there are two or
more performance obligations under the contact, which shall be fulfilled, the Group will apportion the
transaction price to various individual performance obligations in accordance with the relative
proportion of separate selling prices of various goods or services under these performance obligations
on the commencement date of the contract, and measure and recognize the revenue in accordance with
the transaction prices apportioned to various individual performance obligations. The transaction price
refers to the amount of consideration that the Group expects to be entitled to receive due to the transfer
of goods or services to the client, excluding payments received on behalf of third parties. The
transaction price recognized by the Group does not exceed the amount at which the accumulated
recognized revenue will most likely not undergo a significant reversal when the relevant uncertainty is
eliminated. It is expected that the money returned to the client will be regarded as a return liability and
not included in the transaction price. In the event that there is a significant financing part in the
contract, the Group determines the transaction price based on the amount payable in cash when the
client obtains control right over the relevant goods or services. The difference between the transaction
price and the contract consideration shall be amortized by the effective interest method during the
contract period. From the day of the enforcement of the contract, the Group expects that the interval
between the client's acquisition of control right over the goods or services and the client's payment of
the price will not exceed one year, regardless of the significant financing part in the contract.
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
- The Group adjusted relevant accounting policies in accordance with the specific provisions of the
New Revenue Standards on specific matters or transactions, such as contract costs, sales with sales
return clauses, and sales divisions with quality assurance clauses.
- In accordance with the New Revenue Standards, the Group, based on the relationship between
performance obligations and client payments, presents contract assets or liabilities in the balance sheet.
At the same time, the Group provides more disclosures on revenue-related information disclosure
requirements in accordance with the New Revenue Standards, such as relevant accounting policies,
judgments with significant influence (the measurement of variable consideration, the method of
allocating the transaction price to each individual performance obligation, the assumption used in
estimating the stand-alone selling price of each individual performance obligation, etc.), information
related to client contracts (revenue recognition for the current period, contract balance, performance
obligations, etc.), and information on assets related to contract costs.
The Group, based on the cumulative impact of the first implementation of the New Revenue Standards,
adjusted the retained earnings at the beginning of 2020 and the amount of other related items in the
financial statements, except for comparative financial statement data.
5.32.2 Changes in significant accounting estimates
Nil
5.32.3 Particulars of first implementation of new income standards to adjust the first
implementation of related items in the financial statements at the beginning of the year
Consolidated Balance Sheet
Unit: Yuan
Item December 31, 2019 January 1, 2020 Adjustments
Current assets:
Monetary fund 1,565,783,980 1,565,783,980
Settlement reserves
Lending funds
Tradable financial assets
Derivative financial assets
Bills receivable
Accounts receivable 266,218,153 266,218,153
Receivables financing 316,470,229 316,470,229
Advance payment 67,707,537 67,707,537
Premium receivable
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Item December 31, 2019 January 1, 2020 Adjustments
Reinsurance accounts receivable
Receivable reserves for reinsurance contract
Other receivables 24,246,812 24,246,812
Including: Interest receivable 148,927 148,927
Dividends receivable
Redemptory monetary capital for sale
Inventories 2,872,410,407 2,872,410,407
Contract assets
Assets held for sale
Non-current assets due within one year
Other current assets 267,424,938 267,424,938
Total current assets 5,380,262,056 5,380,262,056
Non-current assets:
Offering loans and imprest
Debt investments
Other debt investments
Long-term receivables
Long-term equity investments 43,981,130 43,981,130
Other investments in equity instruments
Other non-current financial assets
Investment real estate 29,714,586 29,714,586
Fixed assets 5,894,068,898 5,894,068,898
Construction in progress 567,478,833 567,478,833
Productive biological assets 202,425,286 202,425,286
Oil-and-gas assets
Right-of-use assets
Intangible assets 651,946,355 651,946,355
Development expenditure
Goodwill 141,859,193 141,859,193
Long-term prepaid expenses 277,595,408 277,595,408
Deferred income tax assets 264,926,503 264,926,503
Other non-current assets 193,674,320 193,674,320
Total non-current assets 8,267,670,512 8,267,670,512
Total assets 13,647,932,568 13,647,932,568
Current liabilities:
Short-term loans 754,313,744 754,313,744
Borrowings from the Central Bank
Loans from other banks and other financial institutions
Tradable financial liabilities
Derivative financial liabilities
Bills payable
Accounts payable 570,252,612 570,252,612
Advances from customers 120,609,499 -120,609,499
Contract liabilities 106,734,070 106,734,070
Financial assets sold for repurchase
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Item December 31, 2019 January 1, 2020 Adjustments
Deposits from customers and interbank
Receivings from vicariously traded securities
Receivings from vicariously sold securities
Employee remunerations payable 234,459,116 234,459,116
Taxes and dues payable 375,169,971 375,169,971
Other payables 450,532,485 450,532,485
Including: Interest payable 758,047 758,047
Dividends payable 1,366,559 1,366,559
Handling charges and commissions payable
Dividend payable for reinsurance
Liabilities held for sale
Non-current liabilities due within one year 150,826,221 150,826,221
Other current liabilities 13,875,429 13,875,429
Total current liabilities 2,656,163,648 2,656,163,648
Non-current liabilities:
Reserves for insurance contracts
Long-term borrowings 128,892,501 128,892,501
Bonds payable
Including: Preferred stock
Perpetual bonds
Lease liabilities
Long-term accounts payable 191,000,000 191,000,000
Long-term employee remunerations payable
Estimated liabilities
Deferred income 70,701,288 70,701,288
Deferred income tax liabilities 14,691,424 14,691,424
Other non-current liabilities 7,645,777 7,645,777
Total non-current liabilities 412,930,990 412,930,990
Total liabilities 3,069,094,638 3,069,094,638
Owner’s equity:
Capital stock 685,464,000 685,464,000
Other equity instruments
Including: Preferred stock
Perpetual bonds
Capital surplus 565,050,422 565,050,422
Minus: Treasury stock
Other comprehensive income -4,235,583 -4,235,583
Special reserves
Surplus reserves 342,732,000 342,732,000
General risk preparation
Undistributed profit 8,719,899,359 8,719,899,359
Total owner’s equities attributable to the parent company 10,308,910,198 10,308,910,198
Minority equity 269,927,732 269,927,732
Total owner’s equities 10,578,837,930 10,578,837,930
Total liabilities and owner’s equities 13,647,932,568 13,647,932,568
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Balance Sheet of the Parent Company
Unit: Yuan
Item December 31, 2019 January 1, 2020 Adjustments
Current assets:
Monetary fund 710,505,269 710,505,269
Tradable financial assets
Derivative financial assets
Bills receivable
Accounts receivable 1,988,326 1,988,326
Receivables financing 41,679,635 41,679,635
Advance payment 776,539 776,539
Other receivables 586,424,958 586,424,958
Including: Interest receivable 90,355 90,355
Dividends receivable 200,000,000 200,000,000
Inventories 434,007,808 434,007,808
Contract assets
Assets held for sale
Non-current assets due within one year
Other current assets 39,130,466 39,130,466
Total current assets 1,814,513,001 1,814,513,001
Non-current assets:
Debt investments
Other debt investments
Long-term receivables
Long-term equity investments 7,432,422,621 7,432,422,621
Other investments in equity instruments
Other non-current financial assets
Investment real estate 29,714,586 29,714,586
Fixed assets 261,137,072 261,137,072
Construction in progress
Productive biological assets 121,414,096 121,414,096
Oil and gas assets
Right-of-use assets
Intangible assets 64,864,913 64,864,913
Development expenditure
Goodwill
Long-term prepaid expenses
Deferred income tax assets 16,255,870 16,255,870
Other non-current assets 1,427,700,000 1,427,700,000
Total non-current assets 9,353,509,158 9,353,509,158
Total assets 11,168,022,159 11,168,022,159
Current liabilities:
Short-term loans 150,000,000 150,000,000
Tradable financial liabilities
Derivative financial liabilities
Bills payable
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Item December 31, 2019 January 1, 2020 Adjustments
Accounts payable 63,655,240 63,655,240
Advances from customers
Contract liabilities
Employee remunerations 70,445,847 70,445,847
Taxes and dues payable 6,052,456 6,052,456
Other payables 660,149,563 660,149,563
Including: Interest payable 181,250 181,250
Dividends payable
Liabilities held for sale
Non-current liabilities due within one year
Other current liabilities
Total current liabilities 950,303,106 950,303,106
Non-current liabilities:
Long-term borrowings
Bonds payable
Including: Preferred stock
Perpetual bonds
Lease liabilities
Long-term accounts payable
Long-term employee remuneration payable
Estimated liabilities
Deferred income 9,176,315 9,176,315
Deferred income tax liabilities
Other non-current liabilities 3,146,707 3,146,707
Total non-current liabilities 12,323,022 12,323,022
Total liabilities 962,626,128 962,626,128
Owner’s equity:
Capital stock 685,464,000 685,464,000
Other equity instruments
Including: Preferred stock
Perpetual bonds
Capital surplus 557,222,454 557,222,454
Minus: Treasury stock
Other comprehensive income
Special reserves
Surplus reserves 342,732,000 342,732,000
Undistributed profit 8,619,977,577 8,619,977,577
Total owner’s equities 10,205,396,031 10,205,396,031
Total liabilities and owner’s equities 11,168,022,159 11,168,022,159
6. Taxes
6.1 The main taxes and tax rates are as follows:
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Tax category Taxation basis Tax rates
Levied on the balance between the
13%, 9%, 6% (China), 20%
output tax calculated based on taxable
Value added tax (France), 21% (Spain), 19% (Chile),
income and the input tax allowed to be
10% (Australia)
deducted in current period
10% of the price, 20% of the price
Consumption tax Levied on taxable income
and 1,000 Yuan each ton (China)
City development tax Levied on circulation tax actually paid 7% (China)
25% (China), 28% (France), 28%
Corporate income tax Levied on taxable income (Spain), 27% (Chile), 30%
(Australia)
6.2 Tax incentives
Ningxia Changyu Grape Growing Co., Ltd.("Ningxia Growing"), a subsidiary of the Group, whose
principal activity is grape growing, is incorporated in Ningxia Huizu Autonomous Region. According
to clause 27 of PRC Corporate Income Tax and clause 86 of PRC Corporate Income Tax Measures for
Implementation, Ningxia Growing enjoys an exemption of corporate income tax.
Yantai Changyu Grape Growing Co., Ltd. ("Grape Growing"), a branch of the Company, whose
principal activity is grape growing, is incorporated in Zhifu District, Yantai City, Shandong Province.
According to clause 27 of PRC Corporate Income Tax and clause 86 of PRC Corporate Income Tax
Measures for Implementation, Grape Growing enjoys an exemption of corporate income tax.
Beijing Changyu AFIP Agriculture Development Co., Ltd ("Agriculture Development"), a subsidiary
of the Group, whose principal activity is grape growing, is incorporated in Miyun County, Beijing.
According to clause 27 of the Corporate Income Tax Law of the People’s Republic of China and clause
86 of the Implementation Rules of Enterprise Income Tax Law of the People’s Republic of China,
Agriculture Development enjoys an exemption of corporate income tax.
Xinjiang Tianzhu Co., Ltd ("Xinjiang Tianzhu"), a subsidiary of the Company, is an enterprise of wine
production and sales incorporated in Shihezi city, Xinjiang Uygur Autonomous Region. In accordance
with the Notice on Tax Policy Issues concerning Further Implementation of the Western China
Development Strategy (Cai Shui [2011] No.58), Xinjiang Tianzhu is qualified to enjoy preferential
taxation policies, which means it can pay corporate income tax at a preferential rate of 15% for the
period from 2015 to 2020.
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Xinjiang Babao Baron Chateau Co., Ltd. ("Shihezi Chateau"), a subsidiary of the Company, is an
enterprise of wine production and sales incorporated in Shihezi city, Xinjiang Uygur Autonomous
Region. In accordance with the Notice on Tax Policy Issues concerning Further Implementation of the
Western China Development Strategy (Cai Shui [2011] No.58), Shihezi Chateau is qualified to enjoy
preferential taxation policies, which means it can pay corporate income tax at a preferential rate of
15% for the period from 2015 to 2020.
7. Notes to items in the consolidated financial statement
7.1 Monetary capital
Unit: Yuan
Item Ending balance Beginning balance
Cash on hand 38,910 59,975
Bank deposit 1,384,635,885 1,474,489,177
Other monetary capital 91,532,260 91,234,828
Total 1,476,207,055 1,565,783,980
Including: Total overseas deposits 49,084,619 42,752,630
As at June 30, 2020, the restricted bank deposit details are listed as follows:
Unit: Yuan
Item Ending balance Beginning balance
Housing fund of the unit 2,684,406 2,647,877
Total 2,684,406 2,647,877
As at June 30, 2020, the details of other monetary funds are listed as follows:
Unit: Yuan
Item Ending balance Beginning balance
Pledge of fixed deposits by Yantai
Changyu Wine Research,
46,100,000 46,100,000
Development and Manufacture Co.,
Ltd. (“R&D Company”)
Guaranteed deposits paid for the letter
44,540,850 44,540,850
of credit
Account balance of Alipay 685,691 583,978
Guaranty money for the unit card 195,719 -
Guaranty money for ICBC platform 10,000 10,000
Total 91,532,260 91,234,828
As at June 30, 2020, the bank deposits of the Group including short-term fixed deposits ranging from
3 months to 12 months amounted to RMB 81,200,000 Yuan (December 31, 2019: RMB 106,128,600),
with the interest rates ranging from 1.40% to 2.75%.
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
7.2 Bills receivable
7.2.1 Classification of bills receivable
Unit: Yuan
Ending balance Beginning balance
Provision for bad Provision for bad
Book balance Book balance
Type debts debts
Book value Book value
Amount Proportion Amount Accrued Amount Proportion Amount Accrued
proportion proportion
Accounts
receivable
for which
provision for
bad debts is
accrued on a
single item
basis
Accounts
receivable
for which
provision for
184,942,173 100% 17,203,540 9.30% 167,738,633 283,522,528 100% 17,304,375 6.10% 266,218,153
bad debts is
accrued on a
combined
basis
Total 184,942,173 100% 17,203,540 9.30% 167,738,633 283,522,528 100% 17,304,375 6.10% 266,218,153
Provision for bad debts accrued on a combined basis:
Unit: Yuan
Ending balance
Name
Book balance Provision for bad debts Accrued proportion
Amounts due from related
2,005,182 67,379 3.40%
parties
Amounts due from other
182,936,991 17,136,161 9.40%
customers
Total 184,942,173 17,203,540 9.30%
Disclosed by age:
Unit: Yuan
Age Ending balance
Within 1 year (including 1 year) 178,061,481
1-2 years 5,228,218
2-3 years 1,652,474
Over 3 years
Total 184,942,173
As at June 30, 2020, the accounts receivable with ownership restrictions were RMB 31,557,404 Yuan
(December 31, 2019: 54,663,422 Yuan). Please refer to Note 7.18 for details.
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
7.2.2 Provision for bad debts accrued, withdrawn or transferred back in this period
Provision for bad debts accrued in this period:
Unit: Yuan
Beginning Changes in this period
Ending
Type balance of the Withdrawn or
Accrued Cancelled balance
year transferred back
Accounts receivable for
which provision for bad 17,304,375 100,835 17,203,540
debts is accrued
Total 17,304,375 100,835 17,203,540
7.2.3 Accounts receivable actually cancelled after verification in this period
Nil
7.2.4 Accounts receivable collected by the borrowers of top 5 units ranked by the ending
balance
Unit: Yuan
Percentage in total Ending balance of
Relationship with
Unit Amount Period accounts provision for bad
the Company
receivable and doubtful debts
Lianhua Supermarket
Third party 12,068,877 Within 1 year 6.50% 1,821,381
Holdings Co., Ltd.
Nonggongshang
Supermarket (Group) Co., Third party 10,822,716 Within 1 year 5.90% 2,588,499
Ltd.
CIA. ZAFFARI
Third party 4,962,855 Within 1 year 2.70% 159,007
COMERCIO E
TRI-VIN IMPORTS, INC. Third party 4,729,522 Within 1 year 2.60% 47,175
Kingsland Wines and Spirits Third party 4,529,090 Within 1 year 2.40% 145,109
Total -- 37,113,060 -- 20.1% 4,761,171
7.2.5 Accounts receivable terminating recognition due to transfer of financial assets
Nil
7.2.6 Accounts receivable transferred and included in assets and liabilities
Nil
7.3 Receivables financing
Unit: Yuan
Item Ending balance Beginning balance
Bills receivable 222,918,741 316,470,229
Total 222,918,741 316,470,229
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
7.3.1 The pledged bills receivable of the Group at the end of the year
Nil
7.3.2 Outstanding endorsed bills that have not matured at the end of the year
Item Amount derecognised at year end
Bank acceptance bills 90,385,572
Total 90,385,572
As at June 30, 2020, bills endorsed by the Group to other parties which are not yet due at the end of
the period is RMB90,385,572 Yuan(December 31, 2019: RMB265,759,455 Yuan). The notes are used
for payment to suppliers and constructions. The Group believes that due to good reputation of bank,
the risk of notes not accepting by bank on maturity is very low, therefore derecognise the note
receivables endorsed. If the bank is unable to pay the notes on maturity, according to the relevant laws
and regulations of China, the Group would undertake limited liability for the notes.
7.4 Advance payment
7.4.1 Advance payment listed by age
Unit: Yuan
Ending balance Beginning sum
Age
Amount Proportion Amount Proportion
Within 1 year 10,200,527 100% 67,441,713 99.6%
1-2 years 265,824 0.4%
2-3 years
More than 3 years
Total 10,200,527 100%-- 67,707,537 --
7.4.2 Advance payment collected by the prepaid parties of top 5 units ranked by the
ending balance
Unit: Yuan
Percentage
Relationship with in the total
Category of client Amount Age Reason for unsettlement
the Group advance
payment%
Chateau De Mirefleurs
Within 1
Related party 6,429,542
Prepayments 63.0%
year
Chateau De Liversan
Related party 1,632,941 Within 1
Prepayments 16.0%
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
year
State Grid Shandong Electronic Power
Within 1
Yantai Company Third party Prepaid electricity fees 12.1%
1,229,571
year
Beijing Shanshui Decoration Company
Within 1
Third party 97,000 Prepaid maintenance cost 1.0%
year
Sinopec Sales Co., Ltd. Shandong
Within 1
Yantai Petroleum Branch Third party 90,000 Prepaid fuel cost 0.9%
year
9,479,054 93.0%
Total -- --
7.5 Other receivables
Unit: Yuan
Item Ending balance Beginning balance
Interest receivable 698,347 148,927
Dividends receivable
Other receivables 24,896,454 24,097,885
Total 25,594,801 24,246,812
7.5.1 Interest receivable
Unit: Yuan
Item Ending balance Beginning balance
Fixed deposit 698,347 148,927
Entrusted loan
Bond investment
Total 698,347 148,927
7.5.2 Other receivables
7.5.2.1 Other receivables classified by nature
Unit: Yuan
Nature Ending book balance Beginning book balance
Deposit and guaranty money receivable 8,546,270 9,812,027
Imprest receivable 832,227 1,741,147
Consumption tax and added-value tax export rebate 7,878,064 8,937,164
Other 7,639,893 3,607,547
Total 24,896,454 24,097,885
7.5.2.2 Disclosed by age
Unit: Yuan
Age Ending balance
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Age Ending balance
Within 1 year (including 1 year) 16,742,154
1-2 years 383,863
2-3 years 721,352
More than 3 years 7,049,085
Total 24,896,454
7.5.2.3 Provision for bad debts accrued, withdrawn or transferred back in this period
The provision for bad debts accrued in this period was RMB 0 Yuan; and that withdrawn or transferred
back in this period was RMB 0 Yuan.
7.5.2.4 Other receivables actually cancelled after verification in this period
Nil
7.5.2.5 Other receivables collected by the borrowers of top 5 units ranked by the ending
balance
Unit: Yuan
Percentage in total Ending balance of
Ending
Unit Nature Age ending balance of other provision for bad
balance
accounts receivable debts
Value-added
Sercicio de Impuestos Internos 6,668,550 Within 1 years 26.8%
tax rebate
Guaranty
YEDA Finance Bureau 5,262,324 Over 3 years 21.1%
money
Construction
YEDA Construction Industry
guaranty 1,143,500 Over 3 years 4.6%
Association
money
Lease
Yantai God Horse Packing Co.,
payment 1,626,880 Within 1 year 6.5%
Ltd.
receivable
Lease
Changyu Group payment 3,775,362 Within 1 year 15.2%
payable
Total -- 18,476,616 -- 74.2%
7.5.2.6 Accounts receivable involving government subsidies
Nil
7.5.2.7 Other receivables that are terminated for recognition due to transfer of financial assets
Nil
7.5.2.8 Other receivables transferred and then included in assets and liabilities
Nil
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
7.6 Inventories
7.6.1 Inventory classification
Unit: Yuan
Ending balance Beginning balance
Item Depreciation Depreciation
Book balance Book value Book balance Book value
provision provision
Raw materials 53,065,316 53,065,316 71,681,418 71,681,418
Goods in process 2,282,289,166 2,282,289,166 2,102,781,536 2,102,781,536
Commodity stocks 609,349,091 8,570,313 600,778,778 718,127,090 20,179,637 697,947,453
Total 2,944,703,573 8,570,313 2,936,133,260 2,892,590,044 20,179,637 2,872,410,407
7.6.2 Inventory depreciation provision
Unit: Yuan
Increase in this period Decrease in this period
Beginning
Item Transfer back or Ending balance
balance Accrual Other Other
write-off
Raw materials
Goods in process
Commodity stocks 20,179,637 11,609,324 8,570,313
Total 20,179,637 11,609,324 8,570,313
7.7 Other current assets
Unit: Yuan
Item Ending balance Beginning balance
Prepaid corporate income tax 26,971,533 16,854,091
Deductible input tax 234,012,096 248,975,183
Rent to be amortized 1,934,092 1,595,664
Total 262,917,721 267,424,938
7.8 Long-term equity investments
Unit: Yuan
Movements during the period Ending
Beginning balance of
Losses from Other Ending balance
Investee balance (book
Increase in Decrease investments omprehensive Other equity
Declare cash Accrual
(book value)
provision
value) dividend or provision for Others for
capital in capita under income changing
profit impairment impairment
equity-method adjustment
1. Joint ventures
SAS L&M
Holdings
43,981,130 -1,170,685 42,810,445
(“L&M
Holdings”)
Subtotal 43,981,130 -1,170,685 42,810,445
On February 22, 2019, Francs Champs Participations SAS (“Francs Champs”), a subsidiary of the
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Group, signed the Cooperation Agreement with SC Garri du Gai to establish L&M Holdings, a joint
venture. Francs Champs contributed 100% of the equity of its subsidiary, Societe Civile Argricole Du
Chateau De Mirefleurs (“Mirefleurs”), with a fair value of RMB45,102,058 Yuan, accounting for 55%
of the shares of L&M Holdings. As per the Agreement and the Articles of Association, L&M Holdings
is jointly controlled by shareholders of both parties.
7.9 Investment real estate
7.9.1 Investment real estate by cost measurement method
Unit: Yuan
Houses and Construction in
Item Land use right Total
buildings progress
Ⅰ Original book value
1. Beginning balance 70,954,045 70,954,045
2. Increase in this period
2.1 Outsourcing
2.2 Transfer in from
inventories\fixed assets\
construction in progress
2.3 Business merger
increase
3. Decrease in this period
3.1 Disposal
3.2 Other transfer out
4. Ending balance 70,954,045 70,954,045
Ⅱ Accumulated depreciation
& accumulated amortization
1. Beginning balance 41,239,459 41,239,459
2. Increase in this period 1,369,899 1,369,899
2.1 Accrual or
1,369,899 1,369,899
amortization
3. Decrease in this period
3.1 Disposal
3.2 Other transfer out
4. Ending balance 42,609,358 42,609,358
Ⅲ Impairment provision
1. Beginning balance
2. Increase in this period
2.1 Accrual
3. Decrease in this period
3.1 Disposal
3.2 Other transfer out
4. Ending balance
Ⅳ Book value
1. Ending book value 28,344,687 28,344,687
2. Beginning book value 29,714,586 29,714,586
7.10 Fixed assets
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Unit: Yuan
Item Ending balance Beginning balance
Fixed assets 5,818,499,845 5,894,068,898
Disposal of fixed assets
Total 5,818,499,845 5,894,068,898
7.10.1 Particulars of fixed assets
Unit: Yuan
Houses and
Item Machinery equipment Construction tools Total
buildings
Ⅰ Original book value:
1. Beginning balance 5,093,628,796 2,730,306,041 26,670,156 7,850,604,993
2. Increase in this period 26,435,121 32,745,994 1,109,021 60,290,136
2.1 Acquisition 16,217,779 30,825,672 1,109,021 48,152,472
2.2 Transfer in from
10,217,342 1,920,322 12,137,664
construction in progress
2.3 Business merger
increase
3. Decrease in this period 1,037,337 1,037,337
3.1 Disposal or
1,037,337 1,037,337
retirement
4. Ending balance 5,120,063,917 2,762,014,698 27,779,177 7,909,857,792
Ⅱ Accumulated
depreciation
1. Beginning balance 755,115,344 1,163,797,943 20,144,781 1,939,058,068
2. Increase in this period 55,228,292 78,723,926 1,136,974 135,089,192
2.1 Accrual 55,228,292 78,723,926 1,136,974 135,089,192
3. Decrease in this period 267,340 267,340
3.1 Disposal or
267,340 267,340
retirement
4. Ending balance 810,343,636 1,242,254,529 21,281,755 2,073,879,920
Ⅲ Impairment provision
1. Beginning balance 17,478,027 17,478,027
2. Increase in this period
2.1 Accrual
3. Decrease in this period
3.1 Disposal or
retirement
4. Ending balance 17,478,027 17,478,027
Ⅳ Book value
1. Ending book value 4,309,720,281 1,502,282,142 6,497,422 5,818,499,845
2. Beginning book value 4,338,513,452 1,549,030,071 6,525,375 5,894,068,898
As at June 30, 2020, the net value of the fixed assets with ownership restrictions was RMB
338,237,400 Yuan (December 31, 2019: RMB 344,670,852 Yuan). Please refer to Note 7.51 for
details.
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
7.10.2 Particulars of temporarily idle fixed assets
Unit: Yuan
Original book Accumulated Depreciation
Item Book value Remarks
value depreciation reserves
Buildings 47,821,026 15,511,660 32,309,366
Machinery equipment 73,592,531 54,095,030 17,478,027 2,019,474
Other equipment 3,344,518 3,176,756 167,762
Total 124,758,075 72,783,446 17,478,027 34,496,602
7.10.3 Particulars of fixed assets under finance leases
Nil
7.10.4 Fixed assets under operating lease
Unit: Yuan
Item Ending book value
Machinery equipment 64,944
7.10.5 Particulars of fixed assets without property certificates
Unit: Yuan
Reason for not receiving the property
Item Book value
certificate
Industrial Production Center of the R&D Company 1,744,312,701 Under transaction
Dormitory Building, Main Building and Reception Building of
283,676,202 Under transaction
Chang’an Chateau
European Town, Main Building and Service Building of Beijing
178,930,935 Under transaction
Chateau
Main Building of Yantai Chateau Changyu Tinlot 78,378,833 Under transaction
Fermentation Workshop and Wine Storage Workshop of Xinjiang
16,802,302 Under transaction
Tianzhu
Office Building and Packaging Workshop of Icewine Valley 8,736,650 Under transaction
Wine-making Workshop of Changyu (Jingyang) 3,707,219 Under transaction
Office Building, Laboratory Building and Workshop of
3,400,025 Under transaction
Fermentation Center
Finished Goods Warehouse and Workshop of Kylin Packaging 2,260,833 Under transaction
Office of Sales Company 2,232,626 Under transaction
Total 2,322,438,325 Under transaction
7.11 Construction in progress
Unit: Yuan
Item Ending balance Beginning balance
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
Construction in progress 647,036,593 567,478,833
Engineering materials
Total 647,036,593 567,478,833
7.11.1 Particulars of construction in progress
Unit: Yuan
Ending balance Beginning balance
Item Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Research, Development & Manufacture
Center (“Changyu Wine City 571,245,868 571,245,868 485,017,326 485,017,326
Complex”)
Construction Project of Ningxia
46,448,561 46,448,561 46,448,561 46,448,561
Chateau
Construction Project of Chang’an
5,002,367 5,002,367 4,052,839 4,052,839
Chateau
Construction Project of Shihezi
1,326,390 1,326,390 877,348 877,348
Chateau
Construction Project of Sales Company 7,925,062 7,925,062 6,313,962 6,313,962
Construction Projects of Other
15,088,345 15,088,345 24,768,797 24,768,797
Companies
Total 647,036,593 647,036,593 567,478,833 567,478,833
2020 SemiannualFinancial Reportt of Yantai Changyu Pioneer Wine Co., Ltd.
7.11.2 Changes of major construction in progress in this period
Transferred Proportion of Accumulative Including:
Other Capitalization
Beginning Increase in to fixed accumulative capitalized capitalized amount
Item Budget decrease in Ending balance ratio of interest Capital source
balance this period assets in this project input in amount of of interest in this
this period in this period
period budget interest period
Loans form financial
Changyu Wine City 1.20% and institutions and
4,505,780,000 485,017,326 92,778,083 6,549,541 571,245,868 79.70% 15,824,401 411,299
Complex 4.3%
self-raised funds
Construction Project of Self-raised funds
414,150,000 46,448,561 46,448,561 102.20%
Ningxia Chateau
Construction Project of Self-raised funds
620,740,000 4,052,839 6,522,266 5,572,738 5,002,367 111.50%
Chang’an Chateau
Construction Project of Self-raised funds
780,000,000 877,348 449,042 1,326,390 96.50%
Shihezi Chateau
Construction Project of Self-raised funds
161,350,000 6,313,962 1,611,100 7,925,062 101.30%
Sales Company
Total 6,482,020,000 542,710,036 101,360,491 12,122,279 631,948,248 -- 15,824,401 411,299 --
As at June 30, 2020, there was no indication for impairment of construction in progress of the Group, so no provision for impairment was made.
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.12 Productive biological assets
7.12.1 Productive biological assets by cost measurement method
Unit: Yuan
Item Plantation Total
Immature Mature
Ⅰ Original book value
1. Beginning balance 12,828,822 240,517,972 253,346,794
2. Increase in this period -5,577,636 6,173,226 595,590
2.1 Outsourcing
2.2 Self cultivation 595,590 595,590
The immature turn to the mature -6,173,226 6,173,226
3. Decrease in this period
3.1 Disposal
3.2 Other
4. Ending balance 7,251,186 246,691,198 253,942,384
Ⅱ Accumulated depreciation
1. Beginning balance 50,921,508 50,921,508
2. Increase in this period 6,782,285 6,782,285
2.1 Accrual 6,782,285 6,782,285
3. Decrease in this period
3.1 Disposal
3.2 Other
4. Ending balance 57,703,793 57,703,793
Ⅲ Impairment provision
1. Beginning balance
2. Increase in this period
2.1 Accrual
3. Decrease in this period
3.1 Disposal
3.2 Other
4. Ending balance
Ⅳ Book value
1. Ending book value 7,251,186 188,987,405 196,238,591
2. Beginning book value 12,828,822 189,596,464 202,425,286
As at June 30, 2020, no ownership of the biological assets was restricted.
As at June 30, 2020, there was no indication for impairment of biological assets of the Group, so no
provision was made.
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.13 Intangible assets
7.13.1 Particulars of intangible assets
Unit: Yuan
Item Land use right Software use right Trademark Total
Ⅰ Original book value
1. Beginning balance 531,755,702 88,258,481 170,773,266 790,787,449
2. Increase in this period 337,512 82,249 419,761
2.1 Acquisition 337,512 82,249 419,761
2.2 Internal R&D
2.3 Business merger
increase
3. Decrease in this period
3.1 Disposal
4. Ending balance 531,755,702 88,595,993 170,855,515 791,207,210
Ⅱ Accumulated amortization
1. Beginning balance 89,333,506 35,165,790 14,341,798 138,841,094
2. Increase in this period 5,353,487 5,716,724 75,325 11,145,536
2.1 Accrual 5,353,487 5,716,724 75,325 11,145,536
3. Decrease in this period
3.1 Disposal
4. Ending balance 94,686,993 40,882,514 14,417,123 149,986,630
Ⅲ Impairment provision
1. Beginning balance
2. Increase in this period
2.1 Accrual
3. Decrease in this period
3.1 Disposal
4. Ending balance
Ⅳ Book value
1. Ending book value 437,068,709 47,713,479 156,438,392 641,220,580
2. Beginning book value 442,422,196 53,092,691 156,431,468 651,946,355
As at June 30, 2020, the net value of the intangible assets with ownership restrictions was RMB
209,707,945 Yuan (December 31, 2019: RMB 212,495,435). Please refer to Note 7.51 for details.
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.13.2 Particulars of land use right of that not receiving the property certificate
Nil
7.14 Goodwill
7.14.1 Original book value of goodwill
Unit: Yuan
Name of the invested Increase in this period Decrease in this period
Beginning
unit or matter forming Formed by business Ending balance
balance Other Disposal Other
goodwill merger
Etablissements Roullet
Fransac (“Roullet 13,112,525 13,112,525
Fransac”)
Dicot Partners, S.L
92,391,901 92,391,901
(“Atrio Group”)
Indomita Wine
6,870,115 6,870,115
Company Chile, SpA
Kilikanoon Estate,
37,063,130 37,063,130
Australia
Total 149,437,671 149,437,671
7.14.2 Provision for impairment of goodwill
Unit: Yuan
Name of the invested Increase in this period Decrease in this period
Beginning
unit or matter forming Formed by business Ending balance
balance Other Disposal Other
goodwill merger
Etablissements Roullet
Fransac (“Roullet
Fransac”)
Dicot Partners, S.L
(“Atrio Group”)
Indomita Wine
Company Chile, SpA
Kilikanoon Estate,
7,578,478 7,578,478
Australia
Total 7,578,478 7,578,478
7.15 Long-term unamortized expenses
Unit: Yuan
Increase in this Amortization in this
Item Beginning balance Other decrease Ending balance
period period
Land lease fees 52,129,414 699,680 51,429,734
Land acquisition
41,460,260 575,734 40,884,526
fees
Afforestation fees 145,952,500 787,431 4,610,618 142,129,313
Renovation costs 32,988,886 1,443,983 31,544,903
Other 5,064,348 283,327 4,781,021
Total 277,595,408 787,431 7,613,342 270,769,497
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.16 Deferred income tax assets/liabilities
7.16.1 Un-offset deferred income tax assets
Unit: Yuan
Ending Balance Beginning Balance
Item Deductible Deductible
Deferred income Deferred income
temporary temporary
tax assets tax assets
difference difference
Asset impairment provision 43,251,879 10,812,970 54,771,519 13,692,880
Unrealized profits from inter-company
333,361,876 83,340,470 479,898,175 119,974,545
transactions
Deductible loss 286,136,558 73,596,023 247,147,752 63,459,305
Unpaid bonus 111,494,802 27,873,700 184,674,946 46,168,736
Dismission welfare 21,088,263 5,272,066 24,833,512 6,208,378
Deferred income 61,772,908 13,428,664 70,643,437 15,422,659
Total 857,106,286 214,323,893 1,061,969,341 264,926,503
7.16.2 Un-offset deferred income tax liabilities
Unit: Yuan
Ending Balance Beginning Balance
Item Taxable Taxable
Deferred income Deferred income
temporary temporary
tax liabilities tax liabilities
difference difference
Assets appraisal appreciation in business merger
50,453,763 14,303,137 51,829,561 14,691,424
under non-common control
Total 50,453,763 14,303,137 51,829,561 14,691,424
7.16.3 Details of unconfirmed deferred income tax assets
Unit: Yuan
Item Ending balance Beginning balance
Deductable temporary difference
Deductible loss 125,159,701 132,081,819
Total 125,159,701 132,081,819
7.16.4 Deductible losses of unconfirmed deferred income tax assets will expire in:
Unit: Yuan
Year Ending sum Beginning sum Remark
2020 5,718,454 5,718,454
2021 36,741,465 36,741,465
2022 26,609,674 26,609,674
2023 6,987,182 31,350,376
2024 7,726,790 31,661,850
2025 41,376,136
Total 125,159,701 132,081,819 --
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.17 Other non-current assets
Unit: Yuan
Item Ending balance Beginning balance
Royalty 184,158,436 193,674,320
Total 184,158,436 193,674,320
7.18 Short-term loans
7.18.1 Classification of short-term loans
Unit: Yuan
Item Ending balance Beginning balance
Pledge loan
Mortgage loan 59,875,404 82,568,222
Guaranteed loan 11,476,342 10,677,905
Fiduciary loan 665,831,955 661,067,617
Total 737,183,701 754,313,744
As at June 30, 2020, mortgaged loans were Hacienday Viedos Marques del Atrio, S.L.U ("Atrio")
factoring of accounts receivable from banks including Banco de Sabadell, S.A. of EUR3,964,000
(equivalent of RMB31,557,404 Yuan) (December 31, 2019: RMB54,663,422 Yuan). Mortgaged loans
were Indomita Wine mortgaged USD4,000,000 (equivalent of RMB28,318,000 Yuan) of its fixed
assets to BBVA (December 31, 2019: RMB27,904,800 Yuan). Australia Kilikanoon Estate has
guaranteed loans of AUD2,358,621 (equivalent of RMB11,476,342 Yuan) (December 31, 2019:
RMB10,677,905 Yuan).
7.19 Accounts payable
7.19.1 List of accounts payable
Unit: Yuan
Item Ending balance Beginning balance
Accounts payable for materials, etc. 379,727,980 570,252,612
Total 379,727,980 570,252,612
7.19.2 Explanation of significant accounts payable aged more than one year
As at June 30, 2020, there were no significant accounts payable aged more than one year.
7.20 Contract liabilities
Unit: Yuan
Item Ending balance Beginning balance
Advances from customers 100,523,260 106,734,070
Total 100,523,260 106,734,070
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.21 Employee remunerations payable
7.21.1 List of employee remunerations payable
Unit: Yuan
Increase in this Decrease in this
Item Beginning balance Ending balance
period period
1. Short-term remuneration 208,889,457 119,601,171 210,105,009 118,385,619
2. Post-employment welfare – defined
736,147 17,329,399 17,676,500 389,046
contribution plan
3. Dismission welfare 24,833,512 441,038 4,186,287 21,088,263
4.Other welfare due within one year
Total 234,459,116 137,371,608 231,967,796 139,862,928
7.21.2 List of short-term remunerations
Unit: Yuan
Increase in this Decrease in this
Item Beginning balance Ending balance
period period
1. Salaries, bonuses, allowances
212,017,795 104,134,847 192,207,416 123,945,226
and subsidies
2. Staff welfare 2,001,589 2,260,811 4,169,008 93,392
3. Social insurance charges 567,446 5,617,673 6,121,959 63,160
Including: Medical insurance 567,446 4,982,116 5,486,402 63,160
Injury insurance 518,934 518,934
Maternity insurance 116,623 116,623
4. Housing fund 14,195 5,934,629 5,927,978 20,846
5. Union fee and staff education fee 1,934,209 1,653,211 1,678,648 1,908,772
6. Short-term compensated
absences
7. Short-term profit-sharing plan
Minus: Those divided into
7,645,777 7,645,777
non-current liabilities
Total 208,889,457 119,601,171 210,105,009 118,385,619
7.21.3 List of defined contribution plan
Unit: Yuan
Item Beginning balance Increase Decrease Ending balance
1. Basic endowment insurance 736,137 16,573,752 16,920,853 389,036
2. Unemployment insurance 10 755,647 755,647 10
3. Enterprise annuity payment
Total 736,147 17,329,399 17,676,500 389,046
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.21.4 Dismission welfare
Unit: Yuan
Item Beginning balance Increase Decrease Ending balance
1. Compensation for server of labor
441,038 441,038
relation
2. Compensation for early retirement 24,833,512 3,745,249 21,088,263
Total 24,833,512 441,038 4,186,287 21,088,263
7.22 Taxes and dues payable
Unit: Yuan
Item Ending balance Beginning balance
Value added tax 24,637,073 88,590,035
Consumption tax 11,731,929 48,497,550
Corporate income tax 104,903,260 216,958,309
Individual income tax 391,707 840,997
Urban maintenance and construction tax 2,194,198 6,731,772
Education surcharges 1,589,510 4,858,904
Urban land use tax 2,343,608 2,216,390
Other 6,780,990 6,476,014
Total 154,572,275 375,169,971
7.23 Other payables
Unit: Yuan
Item Ending balance Beginning balance
Interest payable 2,167,287 758,047
Dividends payable 480,819,925 1,366,559
Other payables 310,046,401 448,407,879
Total 793,033,613 450,532,485
7.23.1 Interest payable
Unit: Yuan
Item Ending balance Beginning balance
Interest of long-term loans with interest paid by
installment and principal paid on maturity
Interest of corporate bonds
Interest payable of short-term loans 2,167,287 758,047
Interest of preferred shares\ perpetual bonds
divided into financial liabilities
Other
Total 2,167,287 758,047
7.23.2 Dividends payable
Unit: Yuan
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Ending balance Beginning balance
Ordinary stock dividends 479,824,800
Preferred stock dividends/sustainable debt dividends
divided into equity instruments
Other 995,125 1,366,559
Total 480,819,925 1,366,559
7.23.3 Other payables
7.23.3.1 Other payables listed by nature
Unit: Yuan
Item Ending balance Beginning balance
Dealer’s deposit payable 167,342,614 164,649,995
Equipment purchase and construction costs
56,776,519 72,004,009
payable
Transportation charges payable 14,043,603 31,842,443
Advertisement expenses payable 1,107,877 90,741,404
Employee cash deposit 619,282 1,866,765
Supplier’s deposit payable 15,231,550 13,990,900
Contracting fees payable 11,788,691 16,997,685
Other 43,136,265 56,314,678
Total 310,046,401 448,407,879
7.24 Non-current liabilities due within one year
Unit: Yuan
Item Ending balance Beginning balance
Long-term loans due within one year 64,996,064 116,826,221
Bonds payable due within one year
Long-term accounts payable due within
34,000,000 34,000,000
one year
Lease liabilities due within one year
Total 98,996,064 150,826,221
7.25 Long-term loans
7.25.1 Classification of long-term loans
Unit: Yuan
Item Ending balance Beginning balance
Mortgage loan 2,475,871 3,875,992
Guaranteed loan 102,138,400 105,093,000
Fiduciary loan 178,995,129 136,749,730
Less: Long-term loans due within one year 64,996,064 116,826,221
Total 218,613,336 128,892,501
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
As at June 30, 2020, credit loans were EUR22,484,000 borrowed by Atrio from Bankia, Banco
Santander, BBVA and Caja Rural de Navarr etc. (equivalent of RMB178,995,124 Yuan) (December
31, 2019: RMB136,749,730 Yuan). Mortgaged loans (RMB) were long-term borrowings of
RMB43,750,000 Yuan of the R&D Centre, a subsidiary of the Company (December 31, 2019:
RMB56,250,000 Yuan). Australia Kilikanoon Estate has borrowed AUD12,000,000(equivalent of
RMB58,388,400 Yuan) (December 31, 2019: RMB48,843,000 Yuan) from ANZ Bank and its
guaranteed by the Company. Mortgaged loans were borrowings of EUR311,000 (equivalent of
RMB2,475,871 Yuan) form Popular Espaol, pledged with its land which valued EUR2,929,628
(equivalent of RMB23,322,769 Yuan) (December 31, 2019: RMB3,875,992 Yuan).
7.26 Long-term accounts payable
Item Ending balance Beginning balance
Long-term accounts payable 167,000,000 191,000,000
Special accounts payable
Total 167,000,000 191,000,000
7.26.1 Long-term accounts payable listed by nature
Unit: Yuan
Item Ending balance Beginning balance
Agricultural Development Fund of China ("CADF") 201,000,000 225,000,000
Less: Long-term payables due within one year 34,000,000 34,000,000
Balance of long-term payables 167,000,000 191,000,000
In 2016, Agricultural Development Fund invested RMB 305,000,000 Yuan in the Research,
Development & Manufacture Company, accounting for 37.9% of the registered capital. According to
the investment agreement, it is agreed that Agricultural Development Fund will take back the
investment fund in ten years and obtain fixed income according to year, which is 1.2% of the
remaining principal. Except for the above fixed income, the Agricultural Development Fund shall not
enjoy other profits of the Research, Development & Manufacture Company or bear the losses of the
Research, Development & Manufacture Company. Accordingly, the investment of the Agricultural
Development Fund in the Research, Development & Manufacture Company is equity investment
nominally, which is debt investment (finance discount interest loan) in deed. The Group included the
investment of the Agricultural Development Fund in long-term accounts payable measured by
amortized cost. From January to June 2020, the Group gave back the principal of RMB 24,000,000
Yuan. Refer to Note 7.51 for details of mortgaged and pledged assets.
7.27 Deferred income
Unit: Yuan
Increase in this Decrease in this
Item Beginning balance Ending balance Forming reason
period period
Governmental
70,701,288 445,536 9,373,916 61,772,908
subsidy
Total 70,701,288 445,536 9,373,916 61,772,908 --
Projects related to governmental subsidy
Unit: Yuan
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Amount
of Amount Amount
Amount
subsidy included in included in
Beginning offset Other Ending Related to
Item of liabilities newly non-operating other
balance the cost changes balance assets/income
increased revenue in income in
expenses
in this this period this period
period
Industrial development
28,700,000 2,050,000 26,650,000 Related to assets
support project
Xinjiang industrial
revitalisation and
14,220,000 711,000 13,509,000 Related to assets
technological
transformation project
Fixed asset investment
reward of Shihezi 4,716,600 1,140,000 3,576,600 Related to assets
Chateau project
Shandong Peninsula
Blue Economic Area 4,000,000 1,000,000 3,000,000 Related to assets
construction funds
Special government
3,180,000 530,000 2,650,000 Related to assets
grant for infrastructure
Raw wine fermentation
1,869,600 717,450 1,152,150 Related to assets
project
Wine fermentation
capacity construction 2,800,000 200,000 2,600,000 Related to assets
(Huanren) project
Engineering
technology
transformation of 2,320,000 290,000 2,030,000 Related to assets
information system
project
Liquor electronic
1,858,203 333,526 1,524,677 Related to assets
tracking project
Infrastructure
350,000 445,536 64,378 731,158 Related to assets
construction project
Special fund for
efficient water-saving 1,877,000 481,000 1,396,000 Related to assets
irrigation project
Subsidy for economic
and energy-saving
898,100 64,150 833,950 Related to assets
technological
transformation projects
Wine industry
372,000 93,000 279,000 Related to assets
development project
Subsidy for mechanic
development of Penglai 265,397 265,397 Related to assets
Daliuhang Base
Coal subsidy 201,500 13,000 188,500 Related to assets
Cross-border Related to
839,958 124,611 715,347
e-commerce project income
Travelling development Related to
560,000 560,000
fund subsidy project income
Water pollution control Related to
92,930 56,801 36,129
project fund income
Subsidy for boiler
Related to
reconstruction and 80,000 5,000 75,000
income
demolition
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Special funds for the
Related to
development of 1,500,000 1,500,000
income
enterprises
Total 70,701,288 445,536 9,373,916 61,772,908
7.28 Other non-current liabilities
Unit: Yuan
Item Ending balance Beginning balance
Employee remunerations payable 7,645,777 7,645,777
Total 7,645,777 7,645,777
As at June 30, 2020, the employee remunerations payable referred to the job security deposit deducted
from the year-end bonus of the employees higher than sales manager of the Company in proportion,
which will be paid from 2021 to 2023 as predicted.
7.29 Share capital
Unit: Yuan
Increase or decrease (+,-) in this period
Share
Beginning transferred Ending
balance Newly issued Allocated balance
from Other Subtotal
shares shares
accumulation
fund
Total shares 685,464,000 685,464,000
7.30 Capital reserves
Unit: Yuan
Decrease in this
Item Beginning balance Increase in this period Ending balance
period
Capital premium (Share
559,133,834 559,133,834
capital premium)
Other capital reserves 5,916,588 5,916,588
Total 565,050,422 565,050,422
7.31 Other comprehensive income
Unit: Yuan
Amount incurred in this period
Minus: Minus:
amount amount
Amount included in included in
Beginning incurred other other Minus: Attributable Attributable Ending
Item before comprehensive comprehensive income to parent to minority balance
balance
income income before income before tax company shareholders
tax in this and transferred and transferred expenses after tax after tax
period to profit or to retained
loss in this earnings in
period this period
1. Other
comprehensive income
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Amount incurred in this period
Minus: Minus:
amount amount
Amount included in included in
Beginning incurred other other Minus: Attributable Attributable Ending
Item before comprehensive comprehensive income to parent to minority balance
balance
income income before income before tax company shareholders
tax in this and transferred and transferred expenses after tax after tax
period to profit or to retained
loss in this earnings in
period this period
not to be reclassified
into profit and loss
later
Including: Changes
after remeasuring and
resetting the benefit
plans
Other
comprehensive income
not to be reclassified
into profit and loss
under equity law
Changes in the
fair value of other
investments in equity
instruments
Changes in the
fair value of the
enterprise's own credit
risk
2. Other
comprehensive income
-4,235,583 -5,765,822 -5,006,653 -759,169 -9,242,236
to be reclassified into
profit and loss later
Including: Other
comprehensive income
to be reclassified into
profit and loss under
equity law
Changes in the
fair value of other debt
investments
Amount of
financial assets
reclassified into other
comprehensive income
Provision for
credit impairment of
other credit
investments
Provision for
cash-flow hedge
Difference in
translation of Foreign
-4,235,583 -5,765,822 -5,006,653 -759,169 -9,242,236
Currency Financial
Statement
Total other
-4,235,583 -5,765,822 -5,006,653 -759,169 -9,242,236
comprehensive income
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.32 Surplus reserves
Unit: Yuan
Decrease in this
Item Beginning balance Increase in this period Ending balance
period
Legal surplus reserves 342,732,000 342,732,000
Free surplus reserves
Reserve fund
Enterprise expansion fund
Other
Total 342,732,000 342,732,000
7.33 Undistributed profit
Unit: Yuan
Item Ending balance Beginning balance
Undistributed profit at the end of prior period before adjustment 8,719,899,359 8,008,982,547
Total Undistributed profit at the beginning of the period before adjustment -7,540,537
(increase listed with+ , and decrease listed with -)
Undistributed profit at the beginning of the period after adjustment 8,719,899,359 8,001,442,010
Plus: Net profit for owner of the parent company 307,035,572 1,129,735,749
Minus: Drawn legal surplus
Drawn free surplus
Drawn common risk provision
Common dividend payable 479,824,800 411,278,400
Common dividend transferred to share capital
Undistributed profit at the end of period 8,547,110,131 8,719,899,359
7.34 Operating income and operating cost
Unit: Yuan
Amount incurred in this period Amount incurred in prior period
Item
Income Cost Income Cost
Main business 1,390,770,376 569,872,959 2,541,459,605 927,958,197
Other business 10,836,416 4,777,718 16,815,180 8,294,028
Total 1,401,606,792 574,650,677 2,558,274,785 936,252,225
7.35 Taxes and surcharges
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Consumption tax 49,392,779 68,699,658
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Urban maintenance and construction tax 9,360,101 18,763,626
Education surcharges 6,787,564 13,670,717
Building tax 13,946,836 14,184,915
Land use tax 5,823,990 5,478,045
Stamp duty 2,276,001 1,504,356
Other 516,222 1,249,531
Total 88,103,493 123,550,848
7.36 Selling expenses
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Marketing expenses 54,684,262 268,185,487
Employee remunerations 95,885,996 130,725,779
Transportation expenses 53,735,626
Trademark use fees 8,953,500
Storage and lease expenses 17,922,792 24,274,917
Depreciation expenses 25,656,686 20,476,637
Advertisement expenses 14,084,571 26,920,257
Conference expenses 2,447,005 8,945,999
Design & production expenses 1,590,960 2,365,761
Service charges 3,608,458 11,484,614
Travel expenses 8,356,075 11,822,548
Water, electricity and gas charges 4,080,146 7,697,325
Office & postage costs 1,840,823 2,801,706
Packing expenses 2,540,043 3,971,486
Public security & clean-keeping
1,854,437 2,214,479
expenses
Business entertainment expenses 589,472 1,763,307
Other 6,435,820 14,584,873
Total 250,531,046 591,970,801
7.37 Management expenses
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Employee remunerations 27,711,146 62,572,295
Depreciation expenses 36,815,081 31,887,697
Contracting expenses 6,687,337 7,178,106
Repair expenses 4,750,072 8,253,897
Office expenses 5,617,017 10,177,651
Amortization expenses 10,475,529 7,677,849
Afforestation fees 6,910,323 7,682,946
Safe production costs 2,506,681 2,357,016
Rental expenses 4,659,247 4,766,202
Business entertainment expenses 1,480,213 2,631,383
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Public security & clean-keeping
2,957,475 3,356,435
expenses
Travel expenses 424,412 2,971,468
Other 2,075,336 4,039,367
Total 113,069,869 155,552,312
7.38 R&D expenses
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
R&D expenses 1,805,988 2,706,811
Total 1,805,988 2,706,811
7.39 Financial expenses
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Interest expenditure 14,891,310 9,812,560
Minus: Interest income 6,088,281 4,606,417
Plus: Commission charges 2,182,502 1,271,831
Exchange gain or loss 975,571 2,311,609
Total 11,961,102 8,789,583
7.40 Other income
Unit: Yuan
Source of other income Amount incurred in this period Amount incurred in prior period
Supporting fund for industrial development 2,050,000 2,050,000
Reward for investment in fixed assets 1,140,000 1,140,000
Special fund for construction of peninsula blue economic
1,000,000 1,000,000
zone
Other – related to assets 3,497,505 3,082,627
Special fund for supporting corporate development 38,279,579 51,633,350
Other – related to income 3,813,147 5,305,915
Total 49,780,231 64,211,892
7.41 Investment income
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Investment income from long-term equity by equity
-1,170,685
method
Investment income from disposal of long-term equity
Investment income gained from trading financial assets
during the holding period
Investment income gained from disposal of trading
financial assets
Dividend income gained from other equity instruments
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Amount incurred in this period Amount incurred in prior period
during the holding period
Gains generated from the remaining equity remeasured as
per fair value after the loss of control
Interest income gained from equity inverstment during the
holding period
Interest income gained from other equity inverstments
during the holding period
Investment income gained from disposal of other equity
inverstments
Total -1,170,685
7.42 Loss on impairment of credit
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Loss on bad debts of accounts receivable 100,835 -765,935
Total 100,835 -765,935
7.43 Loss on impairment of assets
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
1. Loss on bad debts
2. Inventory falling price loss and loss on
4,242,813 6,148,729
impairment of contrct execution cost
3. Loss on impairment of long-term equity
investment
4. Loss on impairment of investment real estate
5. Loss on impairment of fixed assets
6. Loss on impairment of engineering materials
7. Loss on impairment of construction in progress
8. Loss on impairment of productive biological
assets
9. Loss on impairment of oil and gas assets
10. Loss on impairment of intangible assets
11. Loss on impairment of goodwill
12. Other
Total 4,242,813 6,148,729
7.44 Income from asset disposal
Unit: Yuan
Source of income from asset disposal Amount incurred in this period Amount incurred in prior period
Income from disposal of fixed assets 39,641 1,138
Total 39,641 1,138
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.45 Non-operating income
Unit: Yuan
Amount incurred in Amount incurred in Amount included in the current
Item
this period prior period non-recurring profits/losses
Gains on debt recombination
Gains on exchange of non-monetary
assets
Grains on donations
Governmental subsidy
Other 4,682,230 3,575,914 4,682,230
Total 4,682,230 3,575,914 4,682,230
7.46 Non-operating expenses
Unit: Yuan
Amount incurred in Amount incurred in Amount included in the current
Item non-recurring profits/losses
this period prior period
Loss on debt recombination
Loss on exchange of
non-monetary assets
Donation 500,000 500,000
Fine, penalty and overdue fine
paid due to violation of laws and 31,123 10,811 31,123
administrative regulations
Other 336,150 153,239 336,150
Total 867,273 164,050 867,273
7.47 Income tax expenses
7.47.1 List of income tax expenses
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior
period
Current income tax expenses 59,475,646 161,779,976
Deferred income tax expenses 50,214,323 48,501,602
Total 109,689,969 210,281,578
7.47.2 Adjustment process of accounting profit and income tax expenses
Unit: Yuan
Item Amount incurred in this period
Total profit 418,292,409
Income tax expenses calculated according to the legal/applicable tax rate 104,573,102
Influence of different tax rates applicable to subsidiary 1,151,306
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Amount incurred in this period
Influence of income tax in the term before adjustment 155,763
Influence of nontaxable income
Influence of non-deductible costs, expenses and losses 1,878,100
Influence of deductible loss from use of unconfirmed deferred income tax assets in prior
period
Influence of deductible temporary difference or deductible loss of unconfirmed deferred
1,931,698
income tax assets in this period
Income tax expense 109,689,969
7.48 Other comprehensive income
Refer to Note 7.31 for details.
7.49 Items of cash flow statement
7.49.1 Other cash received related to operating activities
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Governmental subsidy income 40,851,851 62,580,748
Interest income 3,865,811 2,835,438
Net amercement income 269,694 1,225,511
Other 3,186,178 1,143,923
Total 48,173,534 67,785,620
7.49.2 Other cash paid related to operating activities
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Selling expenses 218,880,805 348,849,996
Administrative expenses 37,212,155 41,017,612
Other 3,049,775 2,912,859
Total 259,142,735 392,780,467
7.50 Supplementary information to cash flow statement
7.50.1 Supplementary information to cash flow statement
Unit: Yuan
Supplementary materials Amount incurred in this period Amount incurred in prior period
1. Cash flows from operating activities calculated
-- --
by adjusting the net profit:
Net profit 308,602,440 602,178,315
Plus: Provision for impairment of assets -4,343,648 -5,382,794
Depreciation of fixed assets, oil-and-gas assets 143,241,376 155,147,729
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Supplementary materials Amount incurred in this period Amount incurred in prior period
and productive biological assets
Depreciation of right-of-use assets
Amortization of intangible assets 11,145,536 8,438,742
Amortization of long-term deferred expenses 7,613,342 6,662,662
Losses on disposal of fixed assets, intangible
assets and other long-term assets (profit listed -39,641 -1,138
with “－”)
Losses on retirement of fixed assets (profit listed
2,127
with “－”)
Losses on fair value change (profit listed with
“－”)
Financial costs (profit listed with “－”) 13,316,860 13,987,879
Investment losses (profit listed with “－”) 1,170,685
Decrease in deferred income tax assets (increase
50,602,610 50,789,656
listed with “-”)
Increase of deferred income tax liabilities
-388,287 -3,381,035
(decrease listed with “－”)
Decrease in inventories (increase listed with “-”) -52,113,529 123,958,750
Decrease in operating receivables (increase listed
180,626,835 -172,662,167
with “-”)
Increase in operating payable (decrease listed with
-689,089,527 -280,260,593
“-”)
Other
Net cash flows from operating activities -29,652,821 499,476,006
2. Significant investment and financing activities
-- --
not involving cash deposit and withdrawal:
Debt transferred into assets
Convertible corporate bond due within 1 year
Fixed assets under financing lease
3. Net changes of cash and cash equivalent: -- --
Ending balance of cash 1,300,790,389 1,573,727,077
Minus: Beginning balance of cash 1,365,772,675 1,206,860,334
Plus: Ending balance of cash equivalent
Minus: Beginning balance of cash equivalent
Net increase amount of cash and cash equivalent -64,982,286 366,866,743
7.50.2 Composition of cash and cash equivalents
Unit: Yuan
Item Ending balance Beginning balance
1. Cash 1,300,790,389 1,365,772,675
Including: Cash on hand 38,910 59,975
Bank deposits on demand 1,300,751,479 1,365,712,700
Other monetary capital on demand
Due from central bank available for payment
Due from the industry
Inter-bank lending
2. Cash equivalents
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Ending balance Beginning balance
Including: Bond investment due within three months
3. Balance of cash and cash equivalents at the end of
1,300,790,389 1,365,772,675
period
Including: Restricted use of parent company or
subsidiaries in the group
7.51 Assets with ownership or use right restrictions
Item Ending book value Reason for restriction
Loan deposit, L/C deposit, frozen balance of Alipay,
Monetary capital 94,216,666 housing fund and guaranty money for deposit in unit
card
Bills receivable 31,557,404 Pledge of short-term loans
Pledge of short-term loans, long-term loans and
Fixed assets 338,237,400
long-term accounts payable
Intangible assets 209,707,945 Pledge of long-term accounts payable
Total 673,719,415 --
8. Changes in scope of consolidation
Nil
9. Equity in other entities
9.1 Equity in the subsidiaries
9.1.1 Constitution of enterprise group
Proportion of
Principal business Business shareholding
Name of subsidiary Registration place Acquisition mode
location nature
Direct Indirect
Xinjiang Tianzhu Wine Acquired from a business
Shihezi, Xinjiang, Shihezi, Xinjiang,
Co., Ltd. (“Xinajing Manufacturing 60% combination under
China China
Tianzhu”) non-common control
Etablissements Roullet Acquired from a business
Fransac (“Roullet Cognac, France Cognac, France Trading 100% combination under
Fransac”) non-common control
Acquired from a business
Dicot Partners, S.L
Navarre, Spain Navarre, Spain Sales 75% combination under
(“Dicot”)
non-common control
Via Indómita,S.A.,Via
Dos Andes,S.A., and Acquired by
Bodegas Santa Alicia SpA. Santiago, Chile Santiago, Chile Sales 85% establishment or
(“Chile Indomita Wine investment
Group”)
Kilikanoon Estate Pty Ltd Acquired from a business
Adelaide, Adelaide,
(“Australia Kilikanoon Sales 82.50% combination under
Australia Australia
Estate”) non-common control
Beijing Changyu Sales and Beijing, China Beijing, China Sales 100% Acquired by
Distribution Co., Ltd establishment or
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Proportion of
Principal business Business shareholding
Name of subsidiary Registration place Acquisition mode
location nature
Direct Indirect
("Beijing Sales") investment
Acquired by
Yantai Kylin Packaging Co.,Yantai, Shandong, Yantai, Shandong,
Manufacturing 100% establishment or
Ltd. ("Kylin Packaging") China China
investment
Yantai Chateau Acquired by
Yantai, Shandong, Yantai, Shandong,
Changyu-Castel Co., Ltd Manufacturing 70% establishment or
China China
("Chateau Changyu") (b) investment
Changyu (Jingyang) Wine Acquired by
Xianyang, Xianyang,
Co., Ltd. ("Jingyang Manufacturing 90% 10% establishment or
Shaanxi, China Shaanxi, China
Wine") investment
Yantai Changyu Pioneer Acquired by
Yantai, Shandong, Yantai, Shandong,
Wine Sales Co., Ltd. Sales 100% establishment or
China China
("Sales Company") investment
Langfang Development
Acquired by
Zone Castel-Changyu Langfang, Hebei, Langfang, Hebei,
Manufacturing 39% 10% establishment or
Wine Co., Ltd ("Langfang China China
investment
Castel")
Changyu (Jingyang) Wine Acquired by
Xianyang, Xianyang,
Sales Co., Ltd. ("Jingyang Sales 10% 90% establishment or
Shaanxi, China Shaanxi, China
Sales") investment
Langfang Changyu Acquired by
Langfang, Hebei, Langfang, Hebei,
Pioneer Wine Sales Co., Sales 10% 90% establishment or
China China
Ltd ("Langfang Sales") investment
Shanghai Changyu Sales Acquired by
and Distribution Co., Ltd. Shanghai, China Shanghai, China Sales 30% 70% establishment or
("Shanghai Sales") investment
Beijing Changyu AFIP
Acquired by
Agriculture development Miyun, Beijing, Miyun, Beijing,
Sales 100% establishment or
Co., Ltd ("Agriculture China China
investment
Development")
Beijing Chateau Changyu Acquired by
AFIP Global Co., Ltd. Beijing, China Beijing, China Manufacturing 91.53% establishment or
(“AFIP”) (c) investment
Yantai Changyu Wine Acquired by
Yantai, Shandong, Yantai, Shandong,
Sales Co., Ltd. ("Wines Sales 90% 10% establishment or
China China
Sales") investment
Yantai Changyu Pioneer Acquired by
Yantai, Shandong, Yantai, Shandong,
International Co., Ltd. Sales 70% 30% establishment or
China China
("Pioneer International") investment
Hangzhou Changyu Wine Acquired by
Hangzhou, Hangzhou,
Sales Co., Ltd. Sales 100% establishment or
Zhejiang, China Zhejiang, China
("Hangzhou Changyu") investment
Ningxia Changyu Grape Acquired by
Yinchuan,
Growing Co., Ltd. Ningxia, China Planting 100% establishment or
Ningxia, China
(“Ningxia Growing”) investment
Huanren Changyu Acquired by
Benxi, Liaoning, Benxi, Liaoning,
National Wines Sales Co., Sales 100% establishment or
China China
Ltd. ("National Wines") investment
Liaoning Changyu Golden
Acquired by
Icewine Valley Co., Ltd. Benxi, Liaoning, Benxi, Liaoning,
Manufacturing 51% establishment or
("Golden Icewine Valley") China China
investment
(d)
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Proportion of
Principal business Business shareholding
Name of subsidiary Registration place Acquisition mode
location nature
Direct Indirect
Yantai Development Zone
Acquired by
Changyu Trading Co., Ltd. Yantai, Shandong, Yantai, Shandong,
Sales 100% establishment or
("Development Zone China China
investment
Trading")
Yantai Changyu Fushan Acquired by
Yantai, Shandong, Yantai, Shandong,
Trading Company Sales 100% establishment or
China China
("Fushan Trading") investment
Acquired by
Beijing AFIP Meeting Miyun, Beijing, Miyun, Beijing,
Services 100% establishment or
Center ("Meeting Center") China China
investment
Acquired by
Beijing AFIP Tourism and Miyun, Beijing, Miyun, Beijing,
Tourism 100% establishment or
Culture ("AFIP Tourism") China China
investment
Acquired by
Changyu (Ningxia) Wine
Ningxia, China Ningxia, China Manufacturing 100% establishment or
Co., Ltd. (“Ningxia Wine”)
investment
Yantai Changyu Chateau Acquired by
Yantai, Shandong, Yantai, Shandong,
Tinlot Co., Ltd. ("Chateau Manufacturing 65% 35% establishment or
China China
Tinlot") investment
Qing Tong Xia Changyu Acquired by
Wine Marketing Ltd. Ningxia, China Ningxia, China Sales 100% establishment or
("Qing Tong Xia Sales") investment
Xinjiang Chateau Changyu Acquired by
Shihezi, Xinjiang, Shihezi, Xinjiang,
Baron Balboa Co., Ltd. Manufacturing 100% establishment or
China China
(“Chateau Shihezi”) investment
Ningxia Chateau Changyu Acquired by
Yinchuan, Yinchuan,
Moser XV Co., Ltd. Manufacturing 100% establishment or
Ningxia, China Ningxia, China
(“Chateau Ningxia”) investment
Shaanxi Chateau Changyu Acquired by
Xianyang, Xianyang,
Rena Co., Ltd. (“Chateau Manufacturing 100% establishment or
Shaanxi, China Shaanxi, China
Chang’an”) investment
Yantai Changyu Wine
Acquired by
Research & Development Yantai, Shandong, Yantai, Shandong,
Manufacturing 72% establishment or
Centre Co., Ltd. (“R&D China China
investment
Centre”) (e)
Acquired by
Changyu (HuanRen) Wine Benxi, Liaoning, Benxi, Liaoning,
Manufacturing 100% establishment or
Co., Ltd ("Huan Ren Wine") China China
investment
Xinjiang Changyu Sales Acquired by
Shihezi, Xinjiang, Shihezi, Xinjiang,
Co., Ltd ("Xinjiang Sales 100% establishment or
China China
Sales") investment
Acquired by
Ningxia Changyu Trading Yinchuan, Yinchuan,
Sales 100% establishment or
Co., Ltd ("Ningxia Trading") Ningxia, China Ningxia, China
investment
Shaanxi Changyu Rena Acquired by
Xianyang, Xianyang,
Wine Sales Co., Ltd Sales 100% establishment or
Shaanxi, China Shaanxi, China
("Shaanxi Sales") investment
Penglai Changyu Wine Acquired by
Penglai, Penglai,
Sales Co., Ltd ("Penglai Sales 100% establishment or
Shandong, China Shandong, China
Wine") investment
Laizhou Changyu Wine Acquired by
Laizhou, Laizhou,
Sales Co., Ltd ("Laizhou Sales 100% establishment or
Shandong, China Shandong, China
Sales") investment
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Proportion of
Principal business Business shareholding
Name of subsidiary Registration place Acquisition mode
location nature
Direct Indirect
Francs Champs Acquired by
Investment
Participations SAS Cognac, France Cognac, France 100% establishment or
and trading
(“Francs Champs”) investment
Beijing Retailing Co. Ltd Acquired by establishment
Beijing, China Beijing, China Sales 100%
("Beijing Retailing") or investment
Tianjin Changyu Pioneer Acquired by
Sales Co., Ltd ("Tianjin Tianjin, China Tianjin, China Sales 100% establishment or
Pioneer") (a) investment
Beijing Changyu Pioneer Acquired by
Sales Co., Ltd ("Beijing Beijing, China Beijing, China Sales 100% establishment or
Pioneer") (a) investment
Yantai Roullet Fransac Wine Acquired by
Yantai, Shandong, Yantai, Shandong,
Sales Co., Ltd. (“Yantai Roullet Sales 100% establishment or
Fransac”) China China
investment
Guangzhou Changyu Acquired by
Guanghzou, Guanghzou,
Pioneer Sales Co., Ltd Sales 100% establishment or
Guangdong, China Guangdong, China
("Guangzhou Pioneer") (a) investment
Yantai Changyu Wine Acquired by
Yantai, Shandong, Yantai, Shandong,
Sales Co., Ltd. ("Wine Sales 100% establishment or
China China
Sales Company") investment
Shaanxi Chateau Changyu Acquired by
Xianxin, Shaanxi, Xianxin, Shaanxi,
Rena Tourism Co., Ltd Tourism 100% establishment or
China China
("Chateau Tourism") investment
Longkou Changyu Wine Acquired by
Yantai, Shandong, Yantai, Shandong,
Sales Co., Ltd ("Longkou Sales 100% establishment or
China China
Sales") investment
Explanation for difference between the proportion of shareholding and proportion of voting power in
the subsidiaries:
(a) Companies above were deregistered in 2020.
(b) Chateau Changyu is a Sino-foreign joint venture established by the Company and a foreign
investor, accounting for 70% of Changyu Chateau's equity interest. Through agreement arrangement,
the Company has the full power to control Changyu Chateau's strategic operating, investing and
financing policies. The agreement arrangement will be terminated on December 31, 2022.
(c) AFIP is a limited liability company jointly established by the Company and Yantai De’an and
Beijing Qinglang. In June 2019, Yantai Dean transferred 1.31% of its equity to Yantai Changyu.After
the equity change, the Company holds 91.53% of its equity. Through agreement arrangement, the
Company has the full power to control AFIP's strategic operating, investing and financing policies.
The agreement arrangement will be terminated on September 2, 2024.
(d) Icewine Valley is a Sino-foreign joint venture established by the Company and a foreign investor,
whose 51% of the shares are held by the Company. The Company exercises full control over the
operation, investment and financing policies of Icewine Valley by contract arrangement. The contract
arrangement will expire on December 31, 2021.
(e) The Research, Development & Manufacture Company is a joint venture established by the
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Company and Agricultural Development Fund, whose 72% of the shares were held by the Company
on December 31, 2019. As stated in Note 7.27, the Company exercises full control over the operation,
investment and financing policies of the Research, Development & Manufacture Company by contract
arrangement. The contract arrangement will expire on May 22, 2026. Up to June 30, 2020, the
remaining investment of the Agricultural Development Fund accounted for 28.67% of the registered
capital.
9.1.2 Important non-wholly-owned subsidiaries
Unit: Yuan
Other
Profit/loss Dividend declared
Shareholding comprehensive Balance of minority
attributable to to be distributed to
proportion of income attributable shareholder’s
Name of subsidiary minority minority
minority to minority interest at the end
shareholders in this shareholders in this
shareholders shareholders in this of period
period period
period
Xinjiang Tianzhu 40% -1,268,453 46,315,685
Atrio Group 25% 2,735,240 538,514 995,125 34,148,093
Changyu Chateau 30% 12,365,016
Langfang Castel 51% -605,347 19,033,761
AFIP 8.47% 56,409,393
Icewine Valley 49% 33,319,062
Indomita Wine 15% 549,632 -1,094,853 53,385,908
Kilikanoon Estate,
17.50% 155,796 -202,830 185,128 14,578,260
Australia
Explanation for difference between the proportion of shareholding and proportion of voting power of
the minority shareholders in the subsidiaries: See details in Note 9.1.1.
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
9.1.3 Main financial information of important non-wholly-owned subsidiaries
Unit: Yuan
Ending balance Beginning balance
Name of subsidiary Non-current Current Non-current Total Non-current Current Non-current Total
Current assets Total assets Current assets Total assets
assets liabilities liabilities liabilities assets liabilities liabilities liabilities
Xinjiang Tianzhu 25,075,535 59,767,796 84,843,331 140,364 5,336,114 5,476,478 24,829,435 61,886,751 86,716,186 36,185 5,336,114 5,372,299
Changyu Chateau 130,901,716 112,847,346 243,749,063 163,197,646 163,197,646 142,525,011 113,168,202 255,693,213 174,843,671 400,000 175,243,671
Langfang Castel 15,755,772 14,271,097 30,026,870 1,256,937 1,256,937 19,021,766 14,958,223 33,979,989 4,023,101 4,023,101
Beijing Chateau 250,019,242 441,579,625 691,598,867 35,864,457 188,500 36,052,957 251,829,164 452,444,880 704,274,044 45,607,611 201,500 45,809,111
Icewine Valley 49,358,507 22,498,140 71,856,647 26,818,687 100,000 26,918,687 38,234,720 23,291,375 61,526,095 12,077,206 100,000 12,177,206
Marques del Atrio 414,831,789 94,319,003 509,150,792 226,512,338 145,632,259 372,144,597 470,219,326 91,571,444 561,790,770 380,788,880 53,110,213 433,899,093
Indomita Wine 214,245,502 289,781,873 504,027,375 135,350,982 5,212,702 140,563,684 223,722,688 291,630,115 515,352,803 142,365,749 5,152,974 147,518,723
Kilikanoon Estate,
105,402,015 61,788,070 167,190,085 24,695,865 60,119,965 84,815,830 94,473,620 61,770,599 156,244,219 21,801,347 50,741,981 72,543,328
Australia
Unit: Yuan
Amount incurred in this period Amount incurred in prior period
Name of
subsidiary Total comprehensive Operating cash Total comprehensive
Operating income Net profit Operating income Net profit Operating cash flow
income flow income
Xinjiang Tianzhu -3,171,133 -3,171,133 -756,855 -3,001,571 -1,297,212 -417,462
Changyu Chateau 15,274,042 -416,327 -416,327 9,574,274 24,470,842 -2,189,871 -686,874 6,946,282
Langfang Castel 116,711 -1,186,955 -1,186,955 -54,248 -1,474,975 -821,013 25,801
Beijing Chateau 50,688,043 -2,919,024 -2,919,024 -1,954,062 90,339,526 12,711,985 22,752,823 9,667,568
Icewine Valley 7,365,586 -4,410,928 -4,410,928 733,935 19,763,387 -1,986,710 -754,056 1,903,734
Marques del Atrio 130,982,536 10,940,963 13,095,017 -50,830,985 129,064,457 1,859,381 -4,084,674 -23,846,960
Indomita Wine 78,507,227 3,664,211 -3,634,807 29,108,449 86,818,838 3,762,504 1,880,687 -1,725,571
Kilikanoon Estate,
18,928,910 890,266 -268,764 -6,891,812 22,852,809 -1,509,147 -4,011,458 1,024,962
Australia
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
10. Risks related to financial instruments
The Group has exposure to the following main risks from its use of financial instruments in the normal
course of the Group’s operations:
- Credit risk
- Liquidity risk
- Interest rate risk
- Foreign currency risk
The following mainly presents information about the Group’s exposure to each of the above risks and
their sources, their changes during the year, and the Group’s objectives, policies and processes for
measuring and managing risks, and their changes during the year.
The Group aims to seek appropriate balance between the risks and benefits from its use of financial
instruments and to mitigate the adverse effects that the risks of financial instruments have on the
Group’s financial performance. Based on such objectives, the Group’s risk management policies are
established to identify and analyse the risks faced by the Group, to set appropriate risk limits and
controls, and to monitor risks and adherence to limits. Risk management policies and systems are
reviewed regularly to reflect changes in market conditions and the Group’s activities.
10.1 Credit risk
Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other
party by failing to discharge an obligation. The Group’s credit risk is primarily attributable to cash at
bank, receivables, debt investments and derivative financial instruments entered into for hedging
purposes. Exposure to these credit risks are monitored by management on an ongoing basis.
The cash at bank of the Group is mainly held with well-known financial institutions. Management
does not foresee any significant credit risks from these deposits and does not expect that these
financial institutions may default and cause losses to the Group.
As at June 30, 2020, the Group's maximum exposure to credit risk which will cause a financial loss to
the Group due to failure to discharge an obligation by the counterparties.
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
In order to minimise the credit risk, the Group has adopted a policy to ensure that all sales customers
have good credit records. According to the policy of the Group, credit review is required for clients
who require credit transactions. In addition, the Group continuously monitors the balance of account
receivable to ensure there’s no exposure to significant bad debt risks. For transactions that are not
denominated in the functional currency of the relevant operating unit, the Group does not offer credit
terms without the specific approval of the Department of Credit Control in the Group. In addition, the
Group reviews the recoverable amount of each individual trade debt at each balance sheet date to
ensure that adequate impairment losses are made for irrecoverable amounts. In this regard, the
management of the Group considers that the Group's credit risk is significantly reduced.
Since the Group trades only with recognised and creditworthy third parties, there is no requirement for
collateral. Concentrations of credit risk are managed by customer/counterparty, by geographical region
and by industry sector. As at June 30, 2020, 20.1% of the Group trade receivables are due from top
five customers (December 31, 2019: 20.3%). There is no collateral or other credit enhancement on the
balance of the trade receivables of the Group.
10.2 Liquidity risk
Liquidity risk is the risk that an enterprise will encounter difficulty in meeting obligations that are
settled by delivering cash or another financial asset. The Company and its individual subsidiaries are
responsible for their own cash management, including short-term investment of cash surpluses and the
raising of loans to cover expected cash demands (subject to approval by the Company’s board when
the borrowings exceed certain predetermined levels). The Group’s policy is to regularly monitor its
liquidity requirements and its compliance with lending covenants, to ensure that it maintains sufficient
reserves of cash, readily realisable marketable securities and adequate committed lines of funding
from major financial institutions to meet its liquidity requirements in the short and longer term.
10.3 Interest rate risk
Interest-bearing financial instruments at variable rates and at fixed rates expose the Group to cash flow
interest rate risk and fair value interest risk, respectively. The Group determines the appropriate
weightings of the fixed and floating rate interest-bearing instruments based on the current market
conditions and performs regular reviews and monitoring to achieve an appropriate mix of fixed and
floating rate exposure.
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
(1) As at June 30, 2020, the Group held the following interest-bearing financial instruments:
Fixed rate instruments:
Unit: Yuan
June 30, 2020 December 31, 2019
Item
Effective interest rate Amounts Effective interest rate Amounts
Financial assets
- Cash at bank 1.4%-2.75% 81,200,000 1.1%-2.75% 106,128,600
Financial liabilities
- Short-term loans 0.35%-4.9% -187,183,701 0.35%-4.9% -204,313,744
- Long-term loans (including the
1%-4.275% -239,859,400 1%-2.5% -189,468,722
portion due within one year)
- Long-term payables (including the
1.20% -201,000,000 1.20% -225,000,000
portion due within one year)
Total -546,843,101 -512,653,866
Variable rate instruments:
Unit: Yuan
June 30, 2020 December 31, 2019
Item
Effective interest rate Amounts Effective interest rate Amounts
Financial assets
- Cash at bank 0.3%-1.1% 1,395,007,055 0.3%-1.75% 1,459,595,405
Financial liabilities
- Short-term loans LPR -550,000,000 LPR -550,000,000
- Long-term loans (including the
90% of 5-year LPR -43,750,000 90% of 5-year LPR -56,250,000
portion due within one year)
Total 801,257,055 853,345,405
(2) Sensitivity analysis
Management of the Group believes interest rate risk on bank deposit is not significant, therefore does
not disclose sensitivity analysis for interest rate risk.
As at June 30, 2020, based on assumptions above, it is estimated that a general increase of 50 basis
points in interest rates, with all other variables held constant, would decrease the Group’s equity by
RMB1,113,281 Yuan (2019: RMB2,273,438 Yuan), and net profit by RMB1,113,281 Yuan (2019:
RMB2,273,438 Yuan).
The sensitivity analysis above indicates the instantaneous change in the net profit and equity that
would arise assuming that the change in interest rates had occurred at the balance sheet date and had
been applied to re-measure those financial instruments held by the Group which expose the Group to
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
fair value interest rate risk at the balance sheet date. In respect of the exposure to cash flow interest
rate risk arising from floating rate non-derivative instruments held by the Group at the balance sheet
date, the impact on the net profit and equity is estimated as an annualised impact on interest expense
or income of such a change in interest rates.
10.4 Foreign currency risk
In respect of cash at bank and on hand, accounts receivable and payable, short-term loans denominated
in foreign currencies other than the functional currency, the Group ensures that its net exposure is kept
to an acceptable level by buying or selling foreign currencies at spot rates when necessary to address
short-term imbalances.
(1) As at June 30, 2020, the Group’s exposure to currency risk arising from recognised assets or
liabilities denominated in foreign currencies is presented in the following tables. For presentation
purposes, the amounts of the exposure are shown in Renminbi, translated using the spot rate at the
balance sheet date. Differences resulting from the translation of the financial statements denominated
in foreign currency are excluded.
Unit: Yuan
June 30, 2020 December 31, 2019
Item Balance at foreign Balance at RMB Balance at foreign Balance at RMB
currency equivalent currency equivalent
Cash at bank and on hand 5,423,409 38,957,649 6,662,525 46,592,414
- USD 4,783,307 33,863,425 6,525,673 45,524,399
- EUR 639,871 5,094,014 136,628 1,067,814
- HKD 230 210 224 201
Short-term loans 12,490,000 88,422,955 12,490,000 87,132,738
- USD 12,490,000 88,422,955 12,490,000 87,132,738
(2) Sensitivity analysis
Assuming all other risk variables remained constant, a 5% strengthening of the Renminbi against the
US dollar, Euro and Hong Kong dollar at June 30, 2020 would have impact on the Group’s equity and
net profit by the amount shown below, whose effect is in Renminbi and translated using the spot rate at
the year-end date:
Unit: Yuan
Item Equity Net profit
June 30, 2020
USD 2,727,977 2,727,9777
EUR -53,391 -53,391
HKD
Total 2,674,586 2,674,586
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
December 31, 2019
USD 2,080,417 2,080,417
EUR -53,391 -53,391
HKD -10 -10
Total 2,027,016 2,027,016
A 5% weakening of the Renminbi against the US dollar, Euro and Hong Kong dollar at June 30, 2020
would have had the equal but opposite effect to the amounts shown above, on the basis that all other
variables remained constant.
11. Fair value disclosure
All financial assets and financial liabilities held by the Group are carried at amounts not materially
different from their fair value at June 30, 2020.
12. Related parties and related transactions
12.1 Particulars of the parent company of the Company
Proportion of Proportion of
Name of parent shareholding of the voting powers of
Registration place Business nature Registered capital
company parent company in the parent company
the Company in the Company
Changyu Group Manufacturing
Yantai City 50,000,000 50.40% 50.40%
Company industry
From January to June 2020, there was no fluctuation in the registered capital of the parent company
and its share in equity interest and voting right.
12.2 Particulars of the subsidiaries of the Company
See particulars of the subsidiaries of the Company in Note 9.
12.3 Information about joint ventures and associates of the Company
Other joint ventures and associates that have related party transactions with the Company during this
period or that formed balance when having related party transactions with the Company during the
prior period are as follows:
Name of entity Relationship with the Company
L&M Holdings Joint venture of the Group
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
12.4 Particulars of other related parties
Name of other related parties Relationship between other related parties and the Company
Yantai Changyu Wine Culture Museum Co., Ltd. (“Wine
A company controlled by the same parent company
Culture Museum”)
Yantai Changyu Window of International Wine City Co. Ltd.
A company controlled by the same parent company
(“Window of Wine City”)
Yantai God Horse Packing Co., Ltd. (“God Horse Packing”) A company controlled by the same parent company
Yantai Zhongya Medical Health Wine Co., Ltd. (“Zhongya
A company controlled by the same parent company
Medical”)
Yantai Changyu Cultural Tourism Product Sales Co., Ltd.
A company controlled by the same parent company
(“Cultural Sales”)
Yantai Changyu Cultural Tourism Development Co., Ltd.
A company controlled by the same parent company
(“Cultural Development”)
L&M Holdings Joint ventures
Mirefleurs Subsidiaries of the joint venture
CHATEAU DE LIVERSAN (“LIVERSAN”） Subsidiaries of the joint venture
12.5 Related transactions
12.5.1 Related transactions of purchasing and selling goods and providing and receiving
services
List of purchasing goods/receiving services
Unit: Yuan
Related parties Related transactions Amount incurred in this period Amount incurred in prior period
God Horse Packing Purchasing goods 35,624,517 95,990,354
Zhongya Medical Purchasing goods 574,791 6,037,893
Wine Culture Museum Purchasing goods 5,975,817 9,475,159
Window of Wine City Purchasing goods 1,014,685 2,857,130
Cultural Sales Purchasing goods 3,265,703
Cultural Development Purchasing goods 156,616
List of selling goods/providing services
Unit: Yuan
Related parties Related transactions Amount incurred in this period Amount incurred in prior period
Wine Culture Museum Selling goods 2,765,314 3,377,011
Window of Wine City Selling goods 1,441,166 3,891,101
Zhongya Medical Selling goods 1,349,021 2,559,870
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Related parties Related transactions Amount incurred in this period Amount incurred in prior period
God Horse Packing Selling goods 1,915 3,520
Cultural Sales Selling goods 21,600 3,873,204
Cultural Development Selling goods 1,836,470 1,847,727
The price of transactions between the Group and the related parties are based on the negotiated price.
12.5.2 Related trusteeship/contracting and mandatory administration/outsourcing
Nil
12.5.3 Leasing with related parties
The Company as a lessor:
Unit: Yuan
Rental income recognized in Rental income recognized in
Name of the lessee Type of leased assets
this period prior period
God Horse Packing Office building and plant 746,275 742,883
Zhongya Medical Office building 260,279
The Company as a lessee:
Unit: Yuan
Name of the lessor Type of leased assets Rent recognized in this period Rent recognized in prior period
Changyu Group Company Office building and plant 3,595,583 3,447,891
12.5.4 Related guarantee
Nil
12.5.5 Inter-bank borrowing and lending of related parties
Nil
12.5.6 Asset transfer and debt recombination of related parties
Nil
12.5.7 Other related transactions
Unit: Yuan
Item Note Amount incurred in this period Amount incurred in prior period
8,977,248
Trademark use fee (a)
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
The price of transactions between the Group and the related parties are based on the negotiated price.
12.6 Accounts receivable and payable of the related parties
12.6.1 Accounts receivable
Unit: Yuan
Ending balance Beginning balance
Item Related parties Provision for Provision for
Book balance Book balance
bad debts bad debts
Accounts receivable Zhongya Medical 2,005,182 67,379 4,292,386 59,268
Accounts receivable Window of Wine City 1,610,485 22,237
Other receivable Changyu Group 3,775,362
Other receivables God Horse Packing 1,626,800 813,400
Other non-current assets Changyu Group 184,158,436 193,674,320
Prepayment Mirefleurs 6,429,542
Prepayment L&M Holdings 1,632,941
12.6.2 Accounts payable
Unit: Yuan
Item Related parties Ending book balance Beginning book balance
Accounts payable God Horse Packing 37,075,376 39,893,538
Accounts payable Zhongya Medical 4,392,389 1,024,310
Accounts payable Wine Culture Museum 4,874,963
Accounts payable Window of Wine City 3,758,054
Accounts payable Cultural Sales 297,956
Accounts payable Cultural Development 142,610
Other accounts payable God Horse Packing 604,000 450,000
13. Share-based payment
Nil
14. Commitment and contingency
14.1 Significant commitment
Unit: Yuan
Item Ending balance Beginning balance
Making long-term asset commitments 539,980,000 679,980,000
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
14.2 Contingency
As of the balance sheet date, the Group didn’t have any contingency to be disclosed.
15. Matters after balance sheet
15.1 Important non-adjusting events
Nil
15.2 Profit distribution
Unit: Yuan
Profits or dividends to be distributed 479,824,800
Allocated profits or dividends approved to declare upon
479,824,800
discussion
15.3 Other statement of events after the balance sheet date
According to the decision of the Shareholders’ Meeting dated May 17, 2020, based on the issued
capital stock of 685,464,000 shares in 2019, the Company allocated RMB 7 Yuan in cash (including
tax) for every 10 shares to all shareholders with the total cash dividends of RMB 479,824,800 Yuan.
Such cash dividends were distributed on July 10, 2020 and July 14, 2020 respectively.
16. Other important matters
Nil
17. Notes on major items in financial statements of the parent company
17.1 Accounts receivable
17.1.1 Accounts receivable disclosed by type
Unit: Yuan
Ending balance Beginning balance
Provision for bad Provision for bad
Book balance Book balance
Type debts Book debts
Book value
Accrued value Accrued
Amount Proportion Amount Amount Proportion Amount
proportion proportion
Accounts receivable for
which provision for bad
debts is accrued on a
single item basis
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Accounts receivable for
bad debts is accrued on 304,238 100% 1,978 0.7% 302,260 2,589,936 100% 601,610 23.2% 1,988,326
a combined basis
Total 304,238 100% 1,978 0.7% 302,260 2,589,936 100% 601,610 23.2% 1,988,326
Provision for bad debts accrued on a combined basis:
Unit: Yuan
Ending balance
Name
Book balance Provision for bad debts Accrued proportion
Amounts due from related
304,238 1,978 0.7%
parties
Total 304,238 1,978 --
Disclosed by age:
Unit: Yuan
Age Ending balance
Within 1 year (including 1 year) 304,238
1-2 years
2-3 years
Over 3 years
Total 304,238
17.1.2 Provision for bad debts accrued, withdrawn or transferred back in this period
Unit: Yuan
Changes in t his period
Beginning
Type Withdrawn or Ending balance
balance Accrued Cancelled
transferred back
Accounts receivable for
which provision for bad
601,610 599,632 1,978
debts is accrued by
credit risk features
Total 601,610 599,632 1,978
17.1.3 Accounts receivable actually cancelled after verification in this period
Nil
17.1.4 Accounts receivable collected by the borrower of top 5 units ranked by the ending
balance
Unit: Yuan
Ending balance of accounts Proportion in total ending Ending balance of bad debt
Unit name
receivable balance of accounts receivable reserves
Zhongya Medicine and Health
304,238 100% 1,978
Care Wine Company
Total 304,238 100%
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
17.1.5 Accounts receivable derecognized due to transfer of financial assets
Nil
17.1.6 Accounts receivable transferred and included in assets and liabilities
Nil
17.2 Other receivables
Unit: Yuan
Item Ending balance Beginning balance
Interest receivable 464,614 90,355
Dividends receivable 2,985,375 200,000,000
Other receivables 275,433,946 386,334,603
Total 278,883,935 586,424,958
17.2.1 Interest receivable
Unit: Yuan
Item Ending balance Beginning balance
Fixed deposit 464,614 90,355
Entrusted loan
Bond investment
Total 464,614 90,355
17.2.2 Dividends receivable
Unit: Yuan
Item (or the invested unit) Ending balance Beginning balance
Dividends receivable from subsidiaries 2,985,375 200,000,000
Total 2,985,375 200,000,000
17.2.3 Other receivables
1) Particulars of other receivables classified by nature
Unit: Yuan
Nature Ending book balance Beginning book balance
Accounts receivable from subsidiaries 272,221,693 385,328,319
Accounts receivable from related parties 2,359,130 813,440
Other 853,123 192,844
Total 275,433,946 386,334,603
2) Disclosed by age
Unit: Yuan
Age Ending balance
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Age Ending balance
Within 1 year (including 1 year) 275,413,946
1-2 years
2-3 years
More than 3 years 20,000
Total 275,433,946
3) Provision for bad debts accrued, withdrawn or transferred back in this period
The provision for bad debts accrued in this period was RMB 0 Yuan.
4) Accounts receivable actually cancelled after verification in this period
Nil
5) Other accounts receivable collected by the borrower of top 5 units ranked by the ending balance
Unit: Yuan
Percentage in the
Ending balance
total ending
Unit Nature of fund Ending balance Age of provision for
balance of other
bad debts
accounts receivable
Internal incomings
Sales Company 236,837,358 Within 1 year 86.0%
and outgoings
Internal incomings
R&D Company 19,536,550 Within 1 year 7.1%
and outgoings
Internal incomings
Longkou Sales 9,692,960 Within 1 year 3.5%
and outgoings
Internal incomings
God Horse Packaging 1,626,800 Within 1 year 0.6%
and outgoings
Internal incomings
Golden Icewine Valley 774,832 Within 1 year 0.3%
and outgoings
Total -- 268,468,500 -- 97.5%
6) Accounts receivable related to governmental subsidy
Nil
7) Other accounts receivable derecognized due to transfer of financial assets
Nil
8) Other accounts receivable transferred and included in assets and liabilities
Nil
17.3 Long-term equity investment
Unit: Yuan
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Ending balance Beginning balance
Item Impairment Impairment
Book balance Book value Book balance Book value
reserve reserve
Investment in
7,437,422,621 7,437,422,621 7,432,422,621 7,432,422,621
subsidiaries
Investment in associated
enterprises and joint
ventures
Total 7,437,422,621 7,437,422,621 7,432,422,621 7,432,422,621
17.3.1 Investment in subsidiaries
Unit: Yuan
Increase and decrease in this period Ending
Beginning Ending
balance of
Invested unit balance (book Increase in Decrease in Provision for balance (book
impairment Others provision for
value) investment investment value)
accrued impairment
Xinjiang Tianzhu 60,000,000 60,000,000
Kylin Packaging 23,176,063 23,176,063
Changyu Chateau 28,968,100 28,968,100
Pioneer International 3,500,000 3,500,000
Ningxia Growing 36,573,247 36,573,247
National Wine 2,000,000 2,000,000
Icewine Valley 30,440,500 30,440,500
Beijing Chateau 588,389,444 588,389,444
Sales Company 7,200,000 7,200,000
Langfang Sales 100,000 100,000
Langfang Castel 19,835,730 19,835,730
Wine Sales 4,500,000 4,500,000
Shanghai Marketing 300,000 300,000
Beijing Marketing 850,000 850,000
Jingyang Sales 100,000 100,000
Jingyang Wine 900,000 900,000
Ningxia Wine 222,309,388 222,309,388
Ningxia Chateau 453,463,500 453,463,500
Chateau Tinlot 212,039,586 212,039,586
Shihezi Chateau 812,019,770 812,019,770
Chang’an Chateau 803,892,258 803,892,258
Research,
Development &
3,288,906,445 3,288,906,445
Manufacture
Company
Huanren Wine 22,200,000 22,200,000
Wine Sales Company 5,000,000 5,000,000
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Increase and decrease in this period Ending
Beginning Ending
balance of
Invested unit balance (book Increase in Decrease in Provision for balance (book
impairment Others provision for
value) investment investment value)
accrued impairment
Francs Champs 236,025,404 236,025,404
Marques del Atrio 190,150,544 190,150,544
Indomita Wine 274,248,114 274,248,114
Kilikanoon Estate,
110,334,528 110,334,528
Australia
Total 7,432,422,621 5,000,000 7,437,422,621
17.4 Operating income and operating cost
Unit: Yuan
Amount incurred in this period Amount incurred in prior period
Item
Income Cost Income Cost
Main business 132,995,774 125,288,367 334,207,600 292,023,685
Other business 19,954,741 17,952,827 18,143,402 17,546,895
Total 152,950,515 143,241,194 352,351,002 309,570,580
17.5 Investment income
Unit: Yuan
Amount incurred in Amount incurred in
Item
this period prior period
Income from long-term equity investment by cost method 87,474,604 264,221,755
Income from long-term equity investment by equity method
Investment income from disposal of long-term equity investment
Investment income of the financial assets measured at their fair values and the
variation of which is recorded into the current profits and losses during the
holding period
Investment income gained from disposal of the financial assets measured at
their fair values and the variation of which is recorded into the current profits
and losses
Investment income of held-to-maturity investment during the holding period
Investment income of financial assets held for sale during the holding period
Investment income gained from disposal of financial assets held for sale
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Amount incurred in Amount incurred in
Item
this period prior period
Gains generated from the remaining equity remeasured as per fair value after
the loss of control
Total 87,474,604 264,221,755
18. Supplementary materials
18.1 List of non-current profits/losses in this period
Unit: Yuan
Item Amount Remark
Profits/losses on disposal of non-current assets 39,641
Tax return, deduction and exemption approved beyond the authority or
without formal approval document
Governmental subsidy included in the current profits/losses (excluding those
closely related to the enterprise business and enjoyed in accordance with the 49,780,231
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, joint-run business and joint venture 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, etc.
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
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Amount Remark
Profits/losses on contingencies irrelated to the normal business of the
Company
Profits/losses on changes of fair value of tradable financial assets, derivative
financial assets, tradable financial liabilities and derivative financial
liabilities, and investment income from disposal of tradable financial assets,
derivative financial assets, tradable financial liabilities, derivative financial
liabilities and other investment in creditor's rights, excluding effective
hedging operations relevant to the normal business of the Company
Transfer-back of accounts receivable with single impairment test and
provision for impairment of contract assets
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 the current
profits/losses
Trustee fee income from entrusted operation
Other non-operating income and expenditure besides the above items 3,814,957
Other profits/losses conforming to the definition of non-current profits/losses
Minus: Influenced amount of income tax 13,221,932
Influenced amount of minority shareholders’ equity 144,174
Total 40,268,723 --
18.2 Return on net assets and earnings per share
Earnings per share
Weighted average return on
Profit incurred in this period Basic EPS Diluted EPS
net assets
(Yuan/Share) (Yuan/Share)
Net profit attributable to common
2.96% 0.45 0.45
shareholders of the Company
Net profit attributable to common
shareholders of the Company deducting 2.57% 0.39 0.39
non-incidental profits/losses
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
18.3 Accounting data difference under domestic and foreign accounting standard
18.3.1 Net profits & net assets difference disclosed in the financial report according to
the international accounting standard and Chinese accounting standard
Unit: Yuan
Net profits Net assets
Amount incurred in Amount incurred in prior
Ending balance Beginning balance
this period period
In accordance with the
307,035,572 603,403,789 10,131,863,831 10,308,910,198
Chinese accounting standard
Item & amount adjusted in accordance with the international accounting standard:
In accordance with the
international accounting 307,035,572 603,403,789 10,131,863,831 10,308,910,198
standard
