China Merchants Port Group Co., Ltd. The Report for the First Quarter of 2019
Stock Code: 001872/201872 Stock Name: CM Port Group, CM Port Group B Announcement No. 2019-042
CHINA MERCHANTS PORT GROUP CO., LTD.
THE REPORT FOR THE FIRST QUARTER OF 2019
Date of Disclosure: 30 April 2019
China Merchants Port Group Co., Ltd. The Report for the First Quarter of 2019
Part I Important Notes
The Board of Directors (or the “Board”), the Supervisory Committee as well as the directors,
supervisors and senior management of China Merchants Port Group Co., Ltd. (hereinafter
referred to as the “Company”) hereby guarantee the factuality, accuracy and completeness of
the contents of this Report and its summary, and shall be jointly and severally liable for any
misrepresentations, misleading statements or material omissions therein.
All the Company’s directors have attended the Board meeting for the review of this Report
and its summary.
Bai Jingtao, the Company’s legal representative, Wen Ling, the Company’s Chief Financial
Officer, and Sun Ligan, the person-in-charge of the accounting organ hereby guarantee that
the Financial Statements carried in this Report are factual, accurate and complete.
This Report and its summary have been prepared in both Chinese and English. Should there
be any discrepancies or misunderstandings between the two versions, the Chinese versions
shall prevail.
1
China Merchants Port Group Co., Ltd. The Report for the First Quarter of 2019
Definitions
Term Definition
The “Company”, “CMPort” or “we” China Merchants Port Group Co., Ltd.
Sinotrans Guangdong Sinotrans Guangdong Co., Ltd.
Zhanjiang Port Zhanjiang Port (Group) Co., Ltd.
Zhanjiang Infrastructure Investment Zhanjiang Infrastructure Construction Investment Group Co., Ltd.
CMG China Merchants Group Co., Limited
CWH (H.K.) Chiwan Wharf Holdings (Hong Kong) Limited
CMID China Merchants Investment Development Company Limited
SZPL Shenzhen Urban Planning and Land Resources Committee
The Authority of Qianhai Shenzhen-Hongkong Modern Service
SZQH
Industry Cooperation Zone of Shenzhen
Qianhai Investment Holdings Shenzhen Qianhai Development Investment Holdings Co., Ltd.
CM Qianhai Industrial Shenzhen China Merchants Qianhai Industrial Development Co., Ltd.
CM Chidi Shenzhen China Merchants Qianhai Chidi Industrial Co., Ltd.
CMPort Holdings China Merchants Port Holdings Company Limited (00144.HK)
Ansujie Terminal Services (Shenzhen) Co., Ltd., a wholly-owned
Ansujie
subsidiary of CMPort Holdings
Antongjie Terminal Services (Shenzhen) Co., Ltd., a wholly-owned
Antongjie
subsidiary of CMPort Holdings
Qianhai Hongyu Shenzhen Qianhai Hongyu Industrial Investment Co., Ltd.
Shekou Asset Management Shenzhen China Merchants Shekou Asset Management Co., Ltd.
CMI China Merchants Investment Limited
Lac Assal Lac Assal Investment Holding Company Limited
Cheer Signal Cheer Signal Investment Limited
Khor Ambado Fzco Khor Ambado Free Trade Zone Co., Ltd.
CMHD China Merchants Holdings (Djibouti) Fze
The cninfo website www.cninfo.com.cn
Expressed in the Chinese currency of Renminbi
RMB
Expressed in tens of thousands of Renminbi
RMB’0,000
Expressed in hundreds of millions of Renminbi
RMB’00,000,000
(unless otherwise specified)
2
China Merchants Port Group Co., Ltd. The Report for the First Quarter of 2019
Part II Key Corporate Information
I Key Accounting Data and Financial Information
Indicate by tick mark whether there is any retrospectively restated datum in the table below.
√ Yes □ No
Reasons for the retrospective adjustments or restatements: 1. Changes to accounting policies. For details, please refer to “XII YoY
Changes to Accounting Policies, Estimates and Methods” under “Part III Significant Events” in this report; 2. A business
combination under common control. The Company completed the issuance of shares to the trading counterpart CMID on 25
December 2018 and took control of CMPort Holdings in form and in nature. In accordance with the Accounting Standards for
Business Enterprises No. 33-Consolidated Financial Statements, the Company starts to include CMPort Holdings into the
consolidated financial statements since December 2018. Therefore, the Company adjusted the comparative financial data in the table
below as required by the rules governing business combinations under common control.
Q1 2018 Change (%)
Q1 2019
Original Restated Restated
Operating revenue (RMB) 2,702,894,522.99 615,757,667.14 2,172,750,441.44 24.40%
Net profit attributable to the listed
814,944,249.12 146,662,116.72 381,903,088.64 113.39%
company’s shareholders (RMB)
Net profit attributable to the listed
company’s shareholders before 262,409,245.18 147,400,980.09 129,600,674.09 102.48%
exceptional items (RMB)
Net cash generated from/used in
1,148,963,121.64 105,464,496.51 488,161,711.35 135.37%
operating activities (RMB)
Basic earnings per share (RMB/share) 0.454 0.227 0.213 113.15%
Diluted earnings per share (RMB/share) 0.454 0.227 0.213 113.15%
Weighted average return on equity (%) 2.62% 2.91% 1.33% 1.29%
31 December 2018 Change (%)
31 March 2019
Original Restated Restated
Total assets (RMB) 145,187,177,118.55 8,147,257,790.54 128,018,084,415.68 13.41%
Equity attributable to the listed
31,440,401,822.20 4,313,532,059.53 30,760,475,412.93 2.21%
company’s shareholders (RMB)
Exceptional gains and losses:
√ Applicable □ Not applicable
Unit: RMB
Item Q1 2019 Note
Gain or loss on disposal of non-current assets (inclusive of
779,531.18
impairment allowance write-offs)
Government subsidies charged to current profit or loss (exclusive
of government subsidies given in the Company’s ordinary course
21,086,769.01
of business at fixed quotas or amounts as per the government’s
uniform standards)
3
China Merchants Port Group Co., Ltd. The Report for the First Quarter of 2019
Capital occupation charges on non-financial enterprises that are
12,811,302.12
recorded into current profit or loss
The Company took control of
Gains due to that the investment costs for the Company to obtain Zhanjiang Port in the current period,
subsidiaries, associates and joint ventures are lower than the and return on investment was
723,737,741.50
enjoyable fair value of the identifiable net assets of the investees recognized and measured on the
when making the investments long-term equity investment in
Zhanjiang Port formerly at fair value
Gain or loss on fair-value changes in trading financial assets and
liabilities, as well as derivative financial assets and liabilities &
Gain or loss on fair-value changes in
income from disposal of trading financial assets and liabilities,
803,969,789.43 financial assets and liabilities at fair
derivative financial assets and liabilities, as well as investments in
value through profit or loss
other debt obligations (exclusive of effective portion of hedges
that arise in the Company’s ordinary course of business)
Non-operating income and expense other than the above 2,586,527.25
Less: Income tax effects 169,501,960.70
Minority interests effects (after tax) 842,934,695.85
Total 552,535,003.94 --
Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item defined or listed in the Explanatory
Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Exceptional Gain/Loss
Items:
□ Applicable √ Not applicable
II Total Number of Shareholders and Holdings of Top 10 Shareholders at 31 March 2019
1. Numbers of Ordinary Shareholders and Preferred Shareholders with Resumed Voting Rights as well as
Holdings of Top 10 Shareholders
Unit: share
Number of preferred
Number of ordinary shareholders 34,074 (including 23,247 A-shareholders and shareholders with resumed
0
at the period-end 10,827 B-shareholders) voting rights at the period-end
(if any)
Top 10 shareholders
Shares in
Nature of Shareholding Restricted
Name of shareholder Total shares held pledge or
shareholder percentage shares held
frozen
China Merchants Investment Development Foreign legal
64.05% 1,148,648,648 1,148,648,648 0
Company Limited person
China Merchants Gangtong Development Domestic
20.68% 370,878,000 0 0
(Shenzhen) Co., Ltd. legal person
Foreign legal
Broadford Global Limited 3.08% 55,314,208 0 0
person
CMBLSA RE FTIF TEMPLETON ASIAN GRW Foreign legal
2.16% 38,708,339 0 Unknown
FD GTI 5496 person
Fund, wealth
management
National Social Security Fund 101 Portfolio 0.18% 3,304,101 0 Unknown
instrument,
etc.
Foreign legal
NORGES BANK 0.16% 2,802,863 0 Unknown
person
4
China Merchants Port Group Co., Ltd. The Report for the First Quarter of 2019
State-owned
China Merchants Securities (HK) Co., Ltd. 0.14% 2,590,937 0 Unknown
legal person
Domestic
Mai Shuqing 0.13% 2,350,247 0 Unknown
natural person
Foreign legal
Vanguard Emerging Markets Stock Index Fund 0.10% 1,763,746 0 Unknown
person
Foreign legal
Canada Post Corporation Registered Pension Plan 0.07% 1,292,406 0 Unknown
person
Top 10 unrestricted shareholders
Shares by type
Name of shareholder Unrestricted shares held
Type Shares
China Merchants Gangtong Development RMB-denominated
370,878,000 370,878,000
(Shenzhen) Co., Ltd. ordinary stock
Domestically listed
Broadford Global Limited 55,314,208 55,314,208
foreign stock
CMBLSA RE FTIF TEMPLETON ASIAN GRW Domestically listed
38,708,339 38,708,339
FD GTI 5496 foreign stock
RMB-denominated
National Social Security Fund 101 Portfolio 3,304,101 3,304,101
ordinary stock
Domestically listed
Norges Bank 2,802,863 2,802,863
foreign stock
Domestically listed
China Merchants Securities (HK) Co., Ltd. 2,590,937 2,590,937
foreign stock
RMB-denominated
Mai Shuqing 2,350,247 2,350,247
ordinary stock
Domestically listed
Vanguard Emerging Markets Stock Index Fund 1,763,746 1,763,746
foreign stock
Domestically listed
Canada Post Corporation Registered Pension Plan 1,292,406 1,292,406
foreign stock
RMB-denominated
Chen Zehong 1,240,000 1,240,000
ordinary stock
China Merchants Gangtong Development (Shenzhen) Co., Ltd. is a
wholly-owned subsidiary of Broadford Global Limited, and Broadford Global
Related or acting-in-concert parties among the
Limited is the controlling shareholder of China Merchants Investment
shareholders above
Development Company Limited. The Company does not know whether the
other unrestricted shareholders are related parties or not.
Top 10 ordinary shareholders involved in securities
N/A
margin trading (if any)
Indicate by tick mark whether any of the top 10 ordinary shareholders or the top 10 unrestricted ordinary shareholders of the
Company conducted any promissory repo during the Reporting Period.
□ Yea √ No
2. Number of Preferred Shareholders and Shareholdings of Top 10 of Them
□ Applicable √ Not applicable
5
China Merchants Port Group Co., Ltd. The Report for the First Quarter of 2019
Part III Significant Events
I Changes in Major Accounting Data and Financial Indicators for the Reporting Period，As
Well As Reasons for Such Changes
√ Applicable □ Not applicable
Unit: RMB
Item 31 March 2019 1 January 2019 Change (%) Explanation of Change
The inclusion of Zhanjiang Port as a new
Notes receivable 182,523,102.29 11,608,669.43 1472.30% entity into the consolidated financial
statements of the current period
The inclusion of Zhanjiang Port as a new
Accounts receivable 1,640,858,015.96 1,109,230,503.08 47.93% entity into the consolidated financial
statements of the current period
Increase in the prepayments by subsidiaries
Prepayments 201,216,459.84 81,845,182.30 145.85% for machinery equipment, and the effect of the
accounting rules governing leases
The inclusion of Zhanjiang Port as a new
Inventories 161,659,512.30 108,567,270.02 48.90% entity into the consolidated financial
statements of the current period
Other non-current Changes in the fair value of investments in
2,939,477,551.93 2,087,872,081.94 40.79%
financial assets Qingdao Port and Ningbo Zhoushan Port
Right-of-use assets recognized as per the new
Right-of-use assets 6,505,658,114.64 6,549,564,031.55 -0.67%
accounting standards governing leases
The inclusion of Zhanjiang Port as a new
entity into the consolidated financial
statements of the current period, normal
Fixed assets 26,540,880,013.69 17,477,797,429.30 51.85%
depreciation allowances, exchange rate
fluctuations and the effect of the new
accounting standards governing leases
The inclusion of Zhanjiang Port as a new
Deferred income tax
120,520,020.83 66,708,157.19 80.67% entity into the consolidated financial
assets
statements of the current period
The inclusion of Zhanjiang Port as a new
Other non-current assets 2,119,736,766.29 395,191,485.98 436.38% entity into the consolidated financial
statements of the current period
The inclusion of Zhanjiang Port as a new
entity into the consolidated financial
Short-term borrowings 7,669,361,618.42 3,425,291,312.62 123.90% statements of the current period, and increase
in short-term bank loans for investment
purposes
The inclusion of Zhanjiang Port as a new
Long-term payables 2,027,482,133.04 1,252,860,200.23 61.83% entity into the consolidated financial
statements of the current period
Lease liabilities recognized according to the
Lease liabilities 989,868,412.75 1,020,239,824.73 -2.98%
new accounting standards governing leases
Item Q1 2019 Q1 2018 Change (%) Explanation of Change
Increase in interest expense due to an increase
Financial expense 431,930,403.64 275,761,221.02 56.63% in the average balance of interest-bearing
liabilities
6
China Merchants Port Group Co., Ltd. The Report for the First Quarter of 2019
The Company took control of Zhanjiang Port
in the current period, and return on investment
investment income 1,491,659,164.10 684,366,403.71 117.96% was recognized and measured on the
long-term equity investment in Zhanjiang Port
formerly at fair value
Gain on changes in fair 803,456,059.74 137,919,530.28 482.55% Increase in the net gain on changes in the fair
value value of trading financial assets
Increase in deferred income tax liabilities due
Income tax expense 428,680,888.19 196,407,949.26 118.26% to an increase in the gain on changes in the
fair value of equity interests held
Item Q1 2019 Q1 2018 Change (%) Explanation of Change
The inclusion of Zhanjiang Port as a new
entity into the consolidated financial
Cash received from sale
of commodities and 2,647,510,819.37 1,819,094,588.96 45.54% statements of the current period, and the
inclusion of TCP as a new entity in the
rendering of services
consolidation financial statements in February
2018
Cash received from other 437,792,411.01 163,911,046.96 167.09% A government subsidy for the western channel
operating activities in the current year
The inclusion of Zhanjiang Port as a new
entity into the consolidated financial
Taxes paid 225,198,426.64 126,141,464.22 78.53% statements of the current period, and the
inclusion of TCP as a new entity in the
consolidation financial statements in February
2018
Net proceeds from the The security deposit received last year for the
disposal of subsidiaries - 1,411,633,655.68 -100.00% transfer of equity interests in China Merchants
and other business units Gangtong Development (Shenzhen) Co., Ltd.
The balance of monetary capital of Zhanjiang
Cash received from other 1,315,937,327.03 - Port, which is included as a new entity into the
-
investing activities consolidated financial statements of the
current period
The inclusion of Zhanjiang Port as a new
Cash paid for the
entity into the consolidated financial
acquisition of fixed
assets, intangible assets 650,139,928.72 481,958,576.95 34.90% statements of the current period, and the
inclusion of TCP as a new entity in the
and other long-term
consolidation financial statements in February
assets
2018
Cash paid for investing 415,845,100.00 63,458,839.54 555.30% The acquisition of a 3.4223% interest in
activities Zhanjiang Port in the current period
Net payments for the
acquisition of - 4,844,558,474.75 -100.00% The acquisition of TCP last year
subsidiaries and other
business units
Cash paid for other 255,659,104.33 25,463,391.23 904.03% The purchase of structured deposits not repaid
investing activities on demand in the current period
Equity funds received by Zhanjiang Port from
Cash received from 460,518,459.96 15,950,000.00 2787.26% its non-controlling shareholders in the current
capital contributions
period
Increase in cash 5,720,896,211.18 9,562,436,640.00 -40.17% Decrease in borrowings obtained in the
borrowings obtained current period
Cash paid for interest Increase in interest expense due to an increase
expenses and distribution 575,131,285.06 231,250,932.71 148.70% in the average balance of interest-bearing
od dividends or profit liabilities
The inclusion of Zhanjiang Port as a new
Cash paid in other 114,109,500.00 31,028,691.80 267.75% entity into the consolidated financial
financing activities
statements of the current period
7
China Merchants Port Group Co., Ltd. The Report for the First Quarter of 2019
II Progress, Influence and Solutions with regard to Significant Events
√ Applicable □ Not applicable
Index to the related
Summary of the significant event Disclosure date
announcement
The acquisition of assets and related-party transactions
On 2 January 2019, the Company and Sinotrans Guangdong signed the Share Transfer
Agreement of Zhanjiang Port (Group) Co., Ltd. in Shenzhen. By the signing of the Refer to
Agreement, the Company was granted 201,034,548 ordinary shares of Zhanjiang Port http://www.cninfo.com
held by Sinotrans Guangdong, which accounted for 5% of the total shares issued by .cn for details of
Zhanjiang Port on the date of signing the Agreement, with a consideration valued at relevant
RMB375,334,390. On 2 January 2019, the Proposal on the Signing of Share Transfer 3 January 2019 announcements on
Agreement of Zhanjiang Port (Group) Co., Ltd. between the Company and Sinotrans 5 January 2019 resolutions
Guangdong was deliberated and approved by the 1st Extraordinary Meeting of the 9th (announcement No.
Board of Directors of the Company in 2019. 2019-002 and
As of 4 January 2019, the share purchase has completed the registration changing announcement No.
procedures and changing filing procedures for foreign-invested enterprises. And the 5% 2019-003)
of shares of Zhanjiang Port held by Sinotrans Guangdong has registered under the
Company.
Foreign investment of wholly-owned subsidiaries and related-party transactions
On 8 January 2019, the wholly-owned subsidiary of the Company CWH (H.K.) signed
the Agreement on Capital Increase of Zhanjiang Port (Group) Co., Ltd. with Zhanjiang
Infrastructure Investment and Zhanjiang Port (hereinafter referred to as the “Capital
Increase Agreement”). According to the provisions of the Capital Increase Agreement,
Zhanjiang Port intends to issue 1,853,518,190 additional common shares at the price of
RMB1.867 per share or equivalent foreign currency to increase its registered capital to Refer to
RMB5,874,209,145. CWH (H.K.) proposed to subscribe for 1,606,855,919 common http://www.cninfo.com
shares, accounting for 27.3544% of the shares issued by Zhanjiang Port on the date of .cn for details of
issuance of the subscribed shares, with a total amount up to RMB3,000,000,000.77 or relevant
equivalent foreign currency (hereinafter referred to as "the transaction"); Zhanjiang announcements on
9 January 2019
Infrastructure Investment proposed to subscribe 246,662,271 common shares, resolutions
25 January 2019
accounting for 4.1991% of the shares issued by Zhanjiang Port on the date of issuance (announcement No.
12 February 2019
of the subscribed shares, with a total amount up to RMB460,518,459.96. 2019-005,
The Proposal on Capital Increase of Wholly-owned Subsidiary to Zhanjiang Port announcement No.
(Group) Co., Ltd. was deliberated and approved by the 2nd Extraordinary Meeting of 2019-013 and
the 9th Board of Directors held by the Company on 8 January 2019 and the 1st announcement No.
Extraordinary General Meeting of 2019 held on 24 January 2019 respectively. 2019-018)
On 2 February 2019, CWH (H.K.) received the Decision on the Non-implementation of
Further Investigation on Anti-Monopoly Review on Enterprise Centralization (Decision
No. [2019]56) issued by the State Administration of Market Regulation. The State
Administration of Market Regulation, after investigation, decided not to carry out
further investigation on this transaction, and CWH (H.K.) might implement
concentration of undertakings from the date of issuance of the decision. As of 3
8
China Merchants Port Group Co., Ltd. The Report for the First Quarter of 2019
February 2019, the registration and filing procedures of the transaction for business
change was finished, and the capital increase to Zhanjiang Port by the Company's
wholly-owned subsidiary CWH (H.K.) was completed.
Land integration and reorganization in Qianhai by wholly-owned subsidiary of
majority-owned subsidiary and related-party transactions
In order to implement the Comprehensive Planning for Qianhai Shenzhen Hongkong
Modern Service Industry Cooperation Zone of Shenzhen and the Comprehensive
Planning for Shekou District in Qianhai and the surrounding Nanshan District in China
(Guangdong) Pilot Free Trade Zone, which are made by the State Council and Shenzhen
Municipal Government, to promote the development of Qianhai-Shenzhen-Hong Kong
Cooperation Zone and Qianhai Shekou Free Trade Zone, the Company signed the
Agreement on Land Integration and Reorganization with SZPL, SZQH and CMG, and
CMG, Qianhai Investment Holdings, and CM Qianhai Industrial and other relevant
parties signed the Joint Venture Cooperation Agreement, to clarify the implementation
plans for land integration and reorganization and the joint venture cooperation in
Qianhai.
To realize the implementation plans of land integration and reorganization and the joint
venture cooperation in Qianhai, SZQH recovered all the land use rights under the
original plan of 19 land-holding companies within the scope and in accordance with the
Refer to
Agreement on Land Integration and Reorganization, and evaluated the land
http://www.cninfo.com
compensation amount of about RMB43.21 billion by calculation (the base date of
.cn for details of
evaluation is 1 January 2015); and then SZQH replaced the land-use rights under the
relevant
new plan whose value equals the compensation value of the land mentioned above with
12 January 2019 announcements on
CM Chidi (with 14% of shares held by Ansujie and Antongjie) (the base date of
26 February 2019 resolutions
evaluation is 1 January 2015, hereinafter referred to as the “land for replacement with
(announcement No.
China Merchants”); SZQH invested part of the land invested by Qianhai into Qianhai
2019-008 and
Investment Holdings to become one of its shareholders, and then the land use right were
announcement No.
invested into Qianhai Hongyu by Qianhai Investment Holdings, who became a
2019-020)
shareholder of Qianhai Hongyu; CM Qianhai Industrial and Qianhai Investment
Holdings increased the capital of the joint venture company with the 100% equity of
CM Chidi and Qianhai Hongyu respectively, and the party with insufficient equity made
up for the cash consideration to ensure that CM Qianhai Industrial and Qianhai
Investment Holdings holds 50% equity of the joint venture company respectively after
the capital increase.
In order to harmonize the economic interest relationships between CM Chidi and the 19
land-holding companies due to the acquisition of land for investment replacement, CM
Chidi signed the Agreement on Confirmation of Compensation for Creditor’s Rights
with the 19 land-holding companies to determine the amount and proportion of land
compensation for creditor’s rights of the 19 land-holding companies. Ansujie and
Antongjie will receive about RMB5.693 billion from CM Chidi as compensation for the
land use rights of about 471,800 square meters, accounting for 13.1758% of the total
amount of land compensation for creditor’s rights. In order to keep the proportion of
land compensation for creditor's rights in line with the proportion of 14% equity held
indirectly by CMPort Holdings, Antongjie, Shekou Asset Management and CM Chidi
9
China Merchants Port Group Co., Ltd. The Report for the First Quarter of 2019
signed the Agreement on Transfer of Creditor’s Rights, to stipulate that Antongjie will
purchase 0.8242% of land compensation for creditor’s rights from Shekou Asset
Management, with an amount of creditor's rights up to about RMB356 million. In
addition, 55% of the total area of T102-0166 and T102-0167 plots owned by Ansujie
and Antongjie and the corresponding shorelines (about 5313,000 square meters of land
area) are replaced to Phase II of Dachanwan Port Area according to the principle of
equal area (including corresponding shorelines). Ansujie and Antongjie no longer enjoy
the compensation of land value under the new and original planning conditions for the
above-mentioned land area. The specific replacement scheme shall be determined by
SZPL, CMG, Antongjie and Ansujie after further consultation with relevant
departments.
In order to pay off the above-mentioned land compensation debts, CM Qianhai
Industrial signed the Agreement on Capital Increase to CM Qianhai Industrial with 19
land-holding companies, to stipulate that the former 19 land-holding companies will
increase their investment to CM Qianhai Industrial by about RMB43.210 billion in
cash, of which about RMB6.049 billion would be raised by Ansujie and Antongjie. With
these increased capital funds, CM Qianhai Industrial will increase its investment in cash
to its wholly-owned subsidiary CM Chidi, who will pay off the land compensation debts
to the 19 land-holding companies with such increased capital funds. In addition, in
order to raise funds for cooperative cash consideration, the 19 land-holding companies
will increase their investment to CM Qianhai Industrial by no more than RMB15 billion
with the same proportion of cash, of which, the incremental funds of Ansujie and
Antongjie will not exceed RMB2.1 billion. CM Qianhai Industrial will increase
investment to its wholly-owned subsidiary CM Chidi with such increased capital funds
to pay for the cash consideration for the joint venture (including but not limited to
advance payment and sincerity deposit, etc.), or pay the joint venture cash consideration
directly to the joint venture company (including but not limited to advance payment and
sincerity deposit, etc.). The cash consideration for the joint venture shall be determined
by the evaluation agency entrusted by CM Qianhai Industrial and Qianhai Investment
Holdings, who will evaluate the 100% equity of CM Chidi and Qianhai Hongyu in
accordance with the Joint Venture Cooperation Agreement. As the specific amount has
not been determined yet, investors should notice to the investment risk.
The Proposal on Land Integration and Reorganization in Qianhai by Wholly-owned
Subsidiary of Majority-owned Subsidiary was deliberated and approved by the 3rd
Extraordinary Meeting of the 9th Board of Directors held by the Company on 11 January
2019 and the 2nd Extraordinary General Meeting of 2019 held on 25 February 2019
respectively.
Related-party transactions of Majority-owned subsidiaries Refer to
On 22 January 2019, the Company's majority-owned subsidiaries, CMPort Holdings, http://www.cninfo.com
CMI, Cheer Signal Investment Limited and Lac Assal signed the Supplementary .cn for details of
Agreement II on Shareholder Agreement of Lac Assal (hereinafter referred to as the 23 January 2019 relevant announcement
“Capital Increase Agreement”) to stipulate that the ports of CMPort Holdings, CMI and on resolutions
Cheer Signal Investment Limited shall increase the capital of Lac Assal by means of (announcement No.
cash contribution according to the proportion of their shareholder’s equity. The total 2019-012)
10
China Merchants Port Group Co., Ltd. The Report for the First Quarter of 2019
amount of capital to increase is USD30,000,000, including USD12,000,000 to be
increased by CMPort Holdings, USD12,000,000 to be increased by CMI and
USD6,000,000 to be increased by Cheer Signal Investment Limited (hereinafter referred
to as the “capital increase”). After the capital increase, the registered capital of Lac
Assal will increase to USD60,060,000. The proportion of shares of CMPort Holdings,
CMI and Cheer Signal Investment Limited will remained unchanged as 40%, 40% and
20% respectively.
The Proposal on Joint Capital Increase of Majority-owned Subsidiaries and Related
Parties to Lake Asaler was deliberated and approved by the 4th Extraordinary Meeting
of the 9th Board of Directors held by the Company on 22 January 2019.
Related-party guarantee provided by majority-owned subsidiary for its shareholding
subsidiary
Khor Ambado Fzco, a shareholding subsidiary of the Company’s majority-owned
subsidiary CMPort Holdings, is planning to apply for a loan of USD240 million from Refer to
the National Development Bank for the construction project in Djibouti Free Trade http://www.cninfo.com
Zone with a term of 13 years. CMPort Holdings intends to provide joint and several .cn for details of
liability guarantee for the loan according to the proportion of its shareholding in KHOR relevant
AMBADO FZCO. The guaranteed amount includes the principal of the loan (USD240 30 March 2019 announcements on
million*12%=USD228.8 million) and the corresponding interest, expenses (if any), 16 April 2019 resolutions
penalty (if any) and so on. The term of guarantee shall be from the effective date of the (announcement No.
guaranty contract to the expiration date of the performance period of the debt under the 2019-028 and
main contract. announcement No.
The Proposal on Related-party Guarantee Provided by Majority-owned Subsidiary for 2019-038)
Its Shareholding Subsidiary was deliberated and approved by the 5th Meeting of the 9th
Board of Directors held by the Company on 28 March 2019 and the 3rd Extraordinary
General Meeting of 2019 held on 15 April 2019 respectively.
The Signature of land lease agreement by wholly-owned subsidiary of majority-owned
subsidiary and related-party transactions
CMHD, a wholly-owned subsidiary of the Company’s majority-owned subsidiary
CMPort Holdings, and Khor Ambado Fzco, a shareholding subsidiary of CMPort
Refer to
Holdings, signed the Land Lease Agreement (hereinafter referred to as the “Land
http://www.cninfo.com
Leasing Agreement”) on 28 March 2019 to stipulate that CMHD shall lease the land in
.cn for details of
B06/B07 plot owned by Khor Ambado Fzco in Djibouti Free Trade Zone, which covers
30 March 2019 relevant announcement
an area of 137,801.63 square meters, with a total rent of USD27,756,004.31 for a lease
on resolutions
period from the date of entry into force of the Land Lease Agreement to 14 August
(announcement No.
2116.
2019-029)
The Proposal on the Signature of Land Lease Agreement by Wholly-owned Subsidiary
of Majority-owned Subsidiary and Related-party Transactions was deliberated and
approved by the 5th Meeting of the 9th Board of Directors held by the Company on 28
March 2019.
Progress of any share repurchase:
□ Applicable √ Not applicable
Progress of any reduction of the repurchased shares through centralized bidding:
11
China Merchants Port Group Co., Ltd. The Report for the First Quarter of 2019
□ Applicable √ Not applicable
III Commitments that the Company’s Actual Controller, Shareholders, Related Parties,
Acquirers, the Company Itself or Other Parties, Failed to Fulfill on Time during the
Reporting Period
□ Applicable √ Not applicable
IV Operating Performance Forecast for January-June 2019
Warning of a forecast loss on or a forecast significant year-on-year change in the net profit of January-June 2019, as well as
explanation of why:
□ Applicable √ Not applicable
V Securities Investments
√ Applicable □ Not applicable
Unit: RMB
Sol Gain
Cumulati Purch
d in /loss
Accoun Gain/loss on ve fair ased Capi
Variety Code Nam the in
ting fair value value in the Accou tal
of of e of Initial Beginning Rep the Ending carrying
measur changes in the changes Repor nting reso
securiti securiti secur investment cost carrying value orti Repo value
ement Reporting recorded ting item urce
es es ities ng rting
model Period into Perio s
Peri Perio
equity d
od d
Trading
Ning Fair Self-
financi
Stock 601018 bo 592,183,095.14 value 1,361,414,474.58 441,455,106.93 0 0 0 0 1,773,099,689.84 own
al
Port method ed
assets
Trading
Qing Fair Self-
financi
Stock 06198 dao 124,405,138.80 value 190,401,046.01 8,511,687.22 0 0 0 0 194,891,593.44 own
al
Port method ed
assets
Trading
Qing Fair Self-
financi
Stock 601298 dao 331,404,250.30 value 413,280,000.00 437,920,000.00 0 0 0 0 851,200,000.00 own
al
Port method ed
assets
Other
Jiang invest
su Fair ments Self-
Stock 600377 Expr 1,120,000.00 value 9,800,000.00 0 75,000.00 0 0 0 9,900,000.00 in own
essw method equity ed
ay instrum
ents
Other
invest
Petro
Fair ments Self-
che
Stock 400032 3,500,000.00 value 382,200.00 0 0 0 0 0 382,200.00 in own
mica
method equity ed
l A1
instrum
ents
Other
invest
Guan Fair ments Self-
Stock 400009 g Jian 27,500.00 value 17,000.00 0 0 0 0 0 17,000.00 in own
1 method equity ed
instrum
ents
Total 1,052,639,984.24 -- 1,975,294,720.59 887,886,794.15 75,000.00 0 0 0 2,829,490,483.28 -- --
12
China Merchants Port Group Co., Ltd. The Report for the First Quarter of 2019
VI Investments in Derivative Financial Instruments
√ Applicable □ Not applicable
Unit: RMB’0,000
Proportion
of ending
Actual
Purchase Impairm Ending investment
Relationshi Related Initial Beginning Sold in the gain/loss
Type of Starting Ending d in the ent investme amount in
Operator p with the transact investment investmen Reporting in the
derivative date date Reporting provision nt the
Company ion amount t amount Period Reporting
Period (if any) amount Company’s
Period
ending net
assets
Forward
28
Financing Non-related foreign 9 March
No 4,961.18 February 4,961.18 0 4,961.18 0 0 0.00% -332.39
institution party exchange 2018
2019
purchasing
29
Financing Non-related Currency 26 March
No 20,177.33 March 20,177.33 0 20,177.33 0 0 0.00% -1,496.24
institution party swap 2019
2018
Forward
Financing Non-related foreign 4 April 26 March
No 173.63 173.63 0 173.63 0 0 0.00%
institution party exchange 2018 2019
purchasing
Forward
Financing Non-related foreign 15 June 21 March
No 42.88 42.88 0 42.88 0 0 0.00%
institution party exchange 2018 2019
purchasing
Forward
Financing Non-related foreign 15 June 8 May
No 4,885.98 4,885.98 0 0 4,885.98 0.06% -102.24
institution party exchange 2018 2019
purchasing
Total 30,241.00 -- -- 30,241.00 0 25,355.02 4,885.98 0.06% -1,930.87
Source of money used for investment All from the Company’s own funds
Legal matters involved (if applicable) N/A
Analysis of risks and control measures In order to reduce the risks resulted from changes in exchange rate of foreign currency loans, the Company
associated with derivative investments held locked the principal and interests exchange rate of US$46.65 million foreign currency loans. Within the time
in Reporting Period (including but not limit and scope of foreign currency loans, risks of changes in exchange rate can be reduced by locking the
limited to market risk, liquidity risk, credit forward exchange rate.
risk, operational risk, legal risk, etc.)
Changes in market prices or fair value of
derivative investments in Reporting Period
(fair value analysis should include Gain and loss on forward financial contracts was RMB-19.3087 million in the Reporting Period.
measurement method and related
assumptions and parameters)
Significant changes in accounting policies
and specific accounting principles adopted
N/A
for derivative investments in Reporting
Period compared to last reporting period
Opinion of independent directors on
N/A
derivative investments and risk control
13
China Merchants Port Group Co., Ltd. The Report for the First Quarter of 2019
VII Communications with the Investment Community such as Researches, Inquiries and
Interviews during the Reporting Period
√ Applicable □ Not applicable
Type of
Date Way of communication Index to main information communicated
communication party
Main inquiry: basic business condition, investments and
By phone and written inquiry financial condition of the Company;
Materials provided: brochure of the Company;
January-March 2019 (through the EasyIR platform of Individual
Index: SZSE EasyIR
SZSE)
(http://irm.cninfo.com.cn/ssessgs/S001872/index.html)
VIII Irregularities in the Provision of Guarantees
□ Applicable √ Not applicable
IX Occupation of the Company’s Capital by the Controlling Shareholder or Its Related
Parties for Non-Operating Purposes
□ Applicable √ Not applicable
X Progress Made on Internal Control
In the first quarter of 2019, according to the results of the work flow combing of internal control for 2018, the sample test of drafts,
internal control defect sheet and the rectification report on internal control, the Company produced the 2018 annual internal control
self-evaluation report, which was disclosed after review and approval at the 5th Meeting of the 9th Board of Directors and the 5th
Meeting of the 9th Supervisory Committee.
The Company engaged Deloitte Touche Tohmatsu Certified Public Accountants LLP to audit the effectiveness of its 2018 financial
reporting internal control. A standard auditor’s report with unqualified opinion was issued by DDT and later disclosed by the
Company.
Currently, the Company has conducted its internal control activities in 2019, including 1) renewed the list of the internal control task
group members; 2) formulated the work plan and schedule for internal control in 2019; 3) determined the working range of the
internal control (China Merchants Port Group Co., Ltd. and its 24 subordinate companies have been brought into the scope of
evaluation of internal control system) and self-assessment procedures of internal control in 2019; 4) conducted self-assessment of
internal control; 5) finished the updating of basic data of risk control.
The Company has completed the internal control work in 2018 according to the schedule in the internal control work plan for 2018,
as well as the preparations for its internal control activities in 2019 according to the schedule in the internal control work plan for
2019, with no deviation or delay.
XI Deposits in and Loans Provided by a Finance Company
The Proposal on Signing Financial Service Agreement with Sinotrans & CSC Finance Co., Ltd. was reviewed and approved on the
Second Meeting of the 9th Board of Directors held by the Company on 23 August 2017, in which, the Company was agreed to signed
14
China Merchants Port Group Co., Ltd. The Report for the First Quarter of 2019
the Financial Service Agreement with Sinotrans & CSC Finance Co., Ltd. (renamed China Merchants Group Finance Co., Ltd. from
August 2017) with the period of three years.
The Proposal on Adjusting Limit of Deposits and Loans and Signing Supplementary Agreement to Financial Service Agreement with
China Merchants Group Finance Co., Ltd and the Related-party Transactions was reviewed and approved on the 5th Meeting of the
9th Board of Directors held by the Company on 28 March 2019, in which, the Company was agreed to signed Supplementary
Agreement to Financial Service Agreement with China Merchants Group Finance Co., Ltd. At the end of the Reporting Period,
deposits in and loans provided by China Merchants Group Finance Co., Ltd. were as follows:
Unit: RMB’0,000
Item Beginning balance Increase Decrease Ending balance
I. Deposits in China Merchants Group Finance Co., Ltd. 3,838.72 6,072.36 6,782.81 3,128.28
II. Loans provided by China Merchants Group Finance Co.,
77,500.00 31,500.00 5,500.00 103,500.00
Ltd.
XII Explain Change of the Accounting Policy, Accounting Estimate and Measurement
Methods as Compared with the Financial Reporting of Last Year
The Accounting Standards for Business Enterprises No. 21 – Lease (hereinafter referred to as “New lease standard”) revised and
issued by Ministry of Finance on 7 December 2018 required that enterprises listed both domestically and overseas and enterprises
listed overseas who prepare the financial statements by International Financial Reporting Standards or Accounting Standards for
Business Enterprises shall implement it form 1 January 2019, and other enterprises implementing the Accounting Standards for
Business Enterprises shall implement it from 1 January 2021. According to the requirements of Ministry of Finance, enterprises
whose subsidiaries are listed overseas and prepare the financial statements by International Financial Reporting Standards or
Accounting Standards for Business Enterprises can implement the new lease standard in advance. The Company, in accordance with
the requirements of Ministry of Finance, implemented the new lease standard from 1 January 2019. For details, see Announcement
on Changes in Accounting Policies (Announcement No.: 2019-031) published by the Company on http://www.cninfo.com.cn dated
30 March 2019.
According to the regulations of the new standards, the Company did not adjust the information during comparative period, executed
the accumulative influence number of the standard for the first time, and adjusted the beginning retained earnings and the amount of
other related items in financial statements. The Group has disclosed the balance sheet with new standards being implemented for the
first day of 1 January 2019 in financial statements of this Report.
For and on behalf of the Board
Bai Jingtao
Legal representative of
China Merchants Port Group Co., Ltd.
Dated 30 April 2019
15
