CHINA MERCHANTS PORT GROUP CO., LTD.
FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
CHINA MERCHANTS PORT GROUP CO., LTD.
FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
CONTENTS PAGES
THE CONSOLIDATED AND COMPANY BALANCE SHEETS 1-4
THE CONSOLIDATED AND COMPANY INCOME STATEMENTS 5-6
THE CONSOLIDATED AND COMPANY CASH FLOW STATEMENTS 7-8
NOTES TO THE FINANCIAL STATEMENTS 9 - 148
CHINA MERCHANTS PORT GROUP CO., LTD.
AT 30 JUNE 2021
Consolidated Balance Sheet
Unit: RMB
31/12/2020
Item Notes 30/6/2021
(Restated)
Current assets:
Cash and bank balances (V)1 9,379,373,597.24 11,918,423,758.71
Held-for-trading financial assets (V)2 1,000,173,287.80 850,165,448.59
Notes receivable (V)3 23,664,430.98 5,391,994.84
Accounts receivable (V)4 1,853,240,938.06 1,393,349,417.02
Accounts receivable financing (V)5 272,889,319.83 217,449,966.41
Prepayments (V)6 86,414,385.31 51,217,870.43
Other receivables (V)7 4,580,706,082.69 3,561,292,313.98
Inventories (V)8 210,008,947.15 214,823,976.30
Assets held for sale (V)9 337,442,757.28 337,442,757.28
Non-current assets due within one year (V)10 74,802,029.68 67,692,473.44
Other current assets (V)11 821,942,182.54 434,074,085.16
Total current assets 18,640,657,958.56 19,051,324,062.16
Non-current Assets:
Long-term receivables (V)12 3,566,899,467.01 3,887,949,993.10
Long-term equity investments (V)13 67,429,276,231.95 66,242,411,222.90
Other investments in equity instruments (V)14 182,017,057.74 181,467,057.74
Other non-current financial assets (V)15 863,909,085.69 910,807,452.56
Investment properties (V)16 5,465,221,390.32 5,558,755,275.21
Fixed assets (V)17 30,664,411,611.93 29,479,755,159.21
Construction in progress (V)18 4,082,810,291.73 5,381,430,606.18
Right-of-use assets (V)19 8,890,396,679.43 9,087,741,812.94
Intangible assets (V)20 18,508,045,341.12 18,772,180,542.10
Development expenditure (V)21 83,411,622.76 64,237,735.23
Goodwill (V)22 6,802,141,621.90 6,675,939,930.13
Long-term prepaid expenses (V)23 865,843,967.74 874,999,735.91
Deferred tax assets (V)24 490,392,389.90 420,857,076.76
Other non-current assets (V)25 2,165,898,294.28 2,138,468,683.64
Total non-current assets 150,060,675,053.50 149,677,002,283.61
TOTAL ASSETS 168,701,333,012.06 168,728,326,345.77
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CHINA MERCHANTS PORT GROUP CO., LTD.
AT 30 JUNE 2021
Consolidated Balance Sheet - continued
Unit: RMB
31/12/2020
Item Notes 30/6/2021
(Restated)
Current liabilities:
Short-term borrowings (V)26 4,918,709,603.87 10,483,775,548.93
Notes payable (V)27 10,456,401.57 7,081,772.32
Accounts payable (V)28 745,241,136.72 607,972,699.59
Receipts in advance (V)29 20,592,775.04 39,510,127.90
Contract liabilities (V)30 188,322,263.74 157,442,109.67
Employee benefits payable (V)31 665,604,858.00 726,897,125.42
Taxes payable (V)32 2,305,150,402.37 2,370,258,689.99
Other payables (V)33 3,866,179,811.31 2,481,217,568.40
Non-current liabilities due within one year (V)34 8,743,691,405.73 3,564,587,701.07
Other current liabilities (V)35 2,165,517,831.24 2,383,668,985.94
Total current liabilities 23,629,466,489.59 22,822,412,329.23
Non-current Liabilities:
Long-term borrowings (V)36 7,334,778,282.88 7,406,322,693.81
Bonds payable (V)37 17,283,407,358.74 21,090,545,845.56
Including: Preferred shares - -
Perpetual bonds - -
Lease liabilities (V)38 1,222,109,735.26 1,327,850,984.08
Long-term payables (V)39 1,218,295,779.86 1,228,461,573.69
Long-term employee benefits payable (V)40 490,799,539.52 507,714,699.46
Provisions (V)41 137,443,350.34 100,406,745.66
Deferred income (V)42 1,091,904,196.33 1,113,180,823.99
Deferred tax liabilities (V)24 4,491,273,249.00 4,347,553,142.73
Other non-current liabilities (V)43 3,525,608,365.56 2,982,220,894.03
Total non-current liabilities 36,795,619,857.49 40,104,257,403.01
TOTAL LIABILITIES 60,425,086,347.08 62,926,669,732.24
SHAREHOLDERS' EQUITY:
Share capital (V)44 1,922,365,124.00 1,922,365,124.00
Capital reserve (V)45 22,955,923,020.10 22,839,598,324.56
Other comprehensive income (V)46 -916,798,522.86 -826,697,303.06
Special reserve (V)47 15,490,721.24 10,201,178.30
Surplus reserve (V)48 890,690,322.28 890,690,322.28
Unappropriated profit (V)49 13,275,656,697.75 12,329,120,098.70
Total shareholders' equity attributable to
38,143,327,362.51 37,165,277,744.78
equity holders of the parent
Total minority interests 70,132,919,302.47 68,636,378,868.75
TOTAL SHAREHOLDERS' EQUITY 108,276,246,664.98 105,801,656,613.53
TOTAL LIABILITIES AND
168,701,333,012.06 168,728,326,345.77
SHAREHOLDERS' EQUITY
The accompanying notes form part of the financial statements.
The financial statements on pages 1 to 148 were signed by the following:
Wang Xiufeng Tu Xiaoping Sun Ligan
Legal Representative Chief Financial Officer Head of Accounting Department
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CHINA MERCHANTS PORT GROUP CO., LTD.
AT 30 JUNE 2021
Balance Sheet of the Company
Unit: RMB
Item Notes 30/6/2021 31/12/2020
Current Assets:
Cash and bank balances 1,232,631,940.36 753,590,556.77
Held-for-trading financial assets 500,000,000.00 800,000,000.00
Accounts receivable 293.35 -
Prepayments 46,244.77 32,236.27
Other receivables (XIV)1 1,999,190,308.29 1,102,712,752.04
Other current assets 2,988,850.89 2,574,148.83
Total current assets 3,734,857,637.66 2,658,909,693.91
Non-current Assets:
Long-term receivables 8,608,371.77 8,667,950.38
Long-term equity investments (XIV)2 37,473,353,363.21 37,236,798,123.55
Other investments in equity instruments 156,160,830.00 155,610,830.00
Fixed assets 1,270,187.24 748,147.75
Construction in progress 4,239,077.41 3,502,416.12
Intangible assets 55,323,370.73 56,760,723.98
Long-term prepaid expenses 1,397,920.79 1,572,660.89
Deferred tax assets 2,427,747.08 1,846,793.34
Total non-current assets 37,702,780,868.23 37,465,507,646.01
TOTAL ASSETS 41,437,638,505.89 40,124,417,339.92
-3-
CHINA MERCHANTS PORT GROUP CO., LTD.
AT 30 JUNE 2021
Balance Sheet of the Company - continued
Unit: RMB
Item Notes 30/6/2021 31/12/2020
Current liabilities:
Short-term borrowings 1,000,888,889.00 2,174,486,432.93
Employee benefits payable 28,598,142.54 27,085,844.52
Taxes payable 129,047,384.38 208,459,425.46
Other payables 1,176,834,631.06 460,457,238.16
Non-current liabilities due within one year 81,485,296.82 33,040,000.00
Other current liabilities 2,012,802,318.59 2,224,519,555.57
Total current liabilities 4,429,656,662.39 5,128,048,496.64
Non-current Liabilities:
Bonds payable 4,000,000,000.00 2,000,000,000.00
Deferred tax liabilities 43,557,026.51 43,419,526.51
Total non-current liabilities 4,043,557,026.51 2,043,419,526.51
TOTAL LIABILITIES 8,473,213,688.90 7,171,468,023.15
SHAREHOLDERS' EQUITY
Share capital 1,922,365,124.00 1,922,365,124.00
Capital reserve 27,600,679,342.67 27,591,847,402.73
Other comprehensive income 105,948,722.50 105,536,222.50
Surplus reserve 890,690,322.28 890,690,322.28
Unappropriated profit 2,444,741,305.54 2,442,510,245.26
TOTAL SHAREHOLDERS' EQUITY 32,964,424,816.99 32,952,949,316.77
TOTAL LIABILITIES AND SHAREHOLDERS'
41,437,638,505.89 40,124,417,339.92
EQUITY
The accompanying notes form part of the financial statements.
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CHINA MERCHANTS PORT GROUP CO., LTD.
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
Consolidated Income Statement
Unit: RMB
Amount incurred in
Amount incurred in
Item Notes the previous period
the current period
(Restated)
I. Operating income (V)50 7,339,942,862.26 5,962,497,716.96
Less: Operating costs (V)50 4,198,451,164.27 3,743,190,504.14
Taxes and levies (V)51 87,671,634.48 77,572,744.95
Administrative expenses (V)52 766,369,973.37 745,721,965.45
Research and development expenses 98,344,411.25 71,988,081.92
Financial expenses (V)53 730,109,013.88 841,408,636.18
Including: Interest expenses 892,510,549.76 997,965,862.47
Interest income 183,191,011.93 142,692,352.77
Add: Other income (V)54 305,982,258.62 56,117,166.36
Investment income (V)55 3,609,743,591.59 1,504,609,268.47
Including: Income from investments in
(V)55 3,557,359,417.25 1,393,872,651.34
associates and joint ventures
Gains from changes in fair value (Loss is marked with "-") (V)56 -488,532,866.45 -295,735,653.30
Gains on impairment of credit (Loss is marked with "-") (V)57 -2,586,332.20 -3,583,778.71
Gains on impairment of assets (Loss is marked with "-") (V)58 - 947,693.77
Gains on disposal of assets (Loss is marked with "-") (V)59 9,432,717.92 560,256,383.38
II. Operating profit 4,893,036,034.49 2,305,226,864.29
Add: Non-operating income (V)60 28,987,669.73 27,745,365.39
Less: Non-operating expenses (V)61 14,323,864.27 23,110,322.51
III. Gross profit 4,907,699,839.95 2,309,861,907.17
Less: Income tax expenses (V)62 643,438,595.12 513,167,463.70
IV. Net profit 4,264,261,244.83 1,796,694,443.47
(I) Categorization by continuity of operation
1. Net profit of continued operation 4,264,261,244.83 1,796,694,443.47
2. Net profit of discontinued operation - -
(II) Categorization by attribution of ownership
1. Net profit attributable to shareholders of the parent 1,677,035,346.17 632,292,086.16
2. Profit or loss attributable to minority shareholder 2,587,225,898.66 1,164,402,357.31
V. Amount of other comprehensive net income after tax (V)46 -314,186,364.19 -1,105,459,189.10
Amount of other comprehensive net income after tax
-89,607,300.16 -379,729,287.29
attributable to equity holders of the parent
(I) Other comprehensive income that will not be reclassified
228,315.37 -1,463,343.44
to profit or loss
1. Other comprehensive income under the equity method
-184,184.63 -1,350,843.44
that will not be reclassified to profit or loss
2. Fair value changes of other investments in equity
412,500.00 -112,500.00
instruments
(II) Other comprehensive income that will be reclassified
-89,835,615.53 -378,265,943.85
subsequently to profit or loss
1. Other comprehensive income under the equity method
-23,133,723.56 12,154,545.52
that will be reclassified to profit or loss
2. Translation differences of financial statements denominated
-66,701,891.97 -390,420,489.37
in foreign currencies
Amount of other comprehensive net income after tax
-224,579,064.03 -725,729,901.81
attributable to minority shareholders
VI. Total comprehensive income attributable to: 3,950,074,880.64 691,235,254.37
Shareholders of the parent 1,587,428,046.01 252,562,798.87
Minority shareholders 2,362,646,834.63 438,672,455.50
VII. Earnings per share
(I) Basic earnings per share 0.87 0.33
(II) Diluted earnings per share 0.87 0.33
The accompanying notes form part of the financial statements.
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CHINA MERCHANTS PORT GROUP CO., LTD.
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
Income Statement of the Company
Unit: RMB
Amount incurred Amount incurred
Item Notes in the current in the previous
period period
I. Operating income (XIV)3 471,974.86 94,339.62
Less: Operating costs (XIV)3 1,132,979.75 1,132,979.82
Administrative expenses 62,053,671.27 56,541,697.34
Financial expenses 80,011,675.00 1,306,524.34
Including: Interest expenses 103,671,335.55 15,828,399.34
Interest income 26,740,035.75 17,871,242.91
Add: Other income 122,335.30 355,292.70
Investment income (XIV)4 1,005,277,395.49 1,326,631,915.23
Including: Income from investments in associates
(XIV)4 86,382,211.38 28,229,153.26
and joint ventures
Gains from changes in fair value (Loss is marked
- 12,306,522.15
with "-")
II. Operating profit 862,673,379.63 1,280,406,868.20
Add: Non-operating income 424,555.92 5,000.00
III. Gross profit 863,097,935.55 1,280,411,868.20
Less: Income tax expenses 130,368,128.15 174,535,694.16
IV. Net profit 732,729,807.40 1,105,876,174.04
V. Amount of other comprehensive net income after tax 412,500.00 -112,500.00
(I) Other comprehensive income that will not be
412,500.00 -112,500.00
reclassified subsequently to profit or loss
1. Changes as a result of remeasurement of the net defined
- -
benefit plan
2. Other comprehensive income under the equity method
- -
that will not be reclassified to profit or loss
3. Fair value changes of other investments in equity
412,500.00 -112,500.00
instruments
(II) Other comprehensive income that will be reclassified
- -
to profit or loss
1. Other comprehensive income under the equity method
- -
that will be reclassified to profit or loss
2. Translation differences of financial statements
- -
denominated in foreign currencies
VI. Total comprehensive income 733,142,307.40 1,105,763,674.04
The accompanying notes form part of the financial statements.
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CHINA MERCHANTS PORT GROUP CO., LTD.
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
Consolidated Cash Flow Statement
Unit: RMB
Amount incurred Amount incurred in
Item Notes in the current the previous period
period (Restated)
I. Cash Flows from Operating Activities
Cash received from sales of goods and rendering of
6,999,276,674.02 5,663,032,758.45
services
Refunds of taxes 85,780,705.21 14,275,811.60
Cash received relating to other operating activities (V)65(1) 603,526,364.98 426,982,722.38
Sub-total of cash inflows 7,688,583,744.21 6,104,291,292.43
Cash paid for goods purchased or services received 1,903,206,790.90 1,626,411,856.74
Cash paid to and on behalf of employees 1,709,301,832.87 1,480,656,394.52
Tax payments 733,071,668.17 566,177,888.65
Cash paid relating to other operating activities (V)65(2) 408,043,044.31 373,303,949.44
Sub-total of cash outflows 4,753,623,336.25 4,046,550,089.35
Net Cash Flows from Operating Activities (V)66(1) 2,934,960,407.96 2,057,741,203.08
II. Cash Flows from Investing Activities
Cash received from disposal and recovery of investments 3,630,000,000.00 2,541,647,276.82
Cash received from investment income 1,520,388,115.39 243,248,600.44
Net cash received from disposal of fixed assets, intangible
21,022,377.14 109,636,776.06
assets and other long-term assets
Cash received relating to other investing activities (V)65(3) 355,653,171.58 509,787,186.59
Sub-total of cash inflows 5,527,063,664.11 3,404,319,839.91
Cash paid to acquire or construct fixed assets, intangible
1,124,649,979.59 1,082,342,987.89
assets and other long-term assets
Cash paid to acquire investments 4,337,300,451.86 7,181,906,008.80
Cash paid relating to other investing activities (V)65(4) 11,284,899.93 3,009,770,070.13
Sub-total of cash outflows 5,473,235,331.38 11,274,019,066.82
Net Cash Flows from Investing Activities 53,828,332.73 -7,869,699,226.91
III. Cash Flows from Financing Activities
Cash received from borrowings 3,694,414,917.83 13,298,279,106.51
Cash received from issue of bonds 4,800,000,000.00 700,000,000.00
Sub-total of cash inflows 8,494,414,917.83 13,998,279,106.51
Repayments of borrowings 13,053,373,996.07 6,724,017,083.73
Dividends paid, profit distributed or interest paid 942,876,415.60 1,161,435,086.07
Including: Dividends paid, profit distributed to minority
- 162,311,700.49
shareholders.
Cash paid relating to other financing activities (V)65(5) 11,496,507.89 756,572,798.17
Sub-total of cash outflows 14,007,746,919.56 8,642,024,967.97
Net Cash Flows from Financing Activities -5,513,332,001.73 5,356,254,138.54
IV. Effect of Foreign Exchange Rate Changes on Cash and
-26,551,995.94 -31,897,846.37
Cash Equivalents
V. Net Decrease in Cash and Cash Equivalents -2,551,095,256.98 -487,601,731.66
Add: Opening Balance of Cash and Cash Equivalents (V)66(2) 11,898,618,327.29 7,787,660,214.80
VI. Closing Balance of Cash and Cash Equivalents (V)66(2) 9,347,523,070.31 7,300,058,483.14
The accompanying notes form part of the financial statements.
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CHINA MERCHANTS PORT GROUP CO., LTD.
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
Cash Flow Statement of the Company
Unit: RMB
Amount incurred Amount incurred
Item Notes in the current in the previous
period period
I. Cash Flows from Operating Activities
Cash received relating to other operating activities 218,034,986.32 23,510,809.16
Sub-total of cash inflows 218,034,986.32 23,510,809.16
Cash paid for goods purchased and services received 40,000.00 -
Cash paid to and on behalf of employees 32,829,622.92 25,483,852.31
Tax payments 209,567,259.29 208,942,631.96
Cash paid relating to other operating activities 33,094,186.67 17,929,140.00
Sub-total of cash outflows 275,531,068.88 252,355,624.27
Net Cash Flows from Operating Activities -57,496,082.56 -228,844,815.11
II. Cash Flows from Investing Activities:
Cash received from disposals and recovery of investments 2,480,000,000.00 1,400,000,000.00
Cash received from investments income 293,098,915.83 184,352,981.91
Cash received relating to investing activities - 222,500,000.00
Sub-total of cash inflows 2,773,098,915.83 1,806,852,981.91
Cash paid to acquire or construct fixed assets, intangible
1,732,237.00 600,000.00
assets and other long-term assets
Cash paid for investments 2,386,523,799.86 2,409,178,988.47
Cash paid relating to other investing activities 198,583,388.96 137,944,110.77
Sub-total of cash outflows 2,586,839,425.82 2,547,723,099.24
Net Cash Flows from Investing Activities 186,259,490.01 -740,870,117.33
III. Cash Flows from Financing Activities:
Cash received from borrowings 5,797,840,000.00 2,999,433,243.33
Cash received relating to other financing activities 25,000,000.00 544,400,000.00
Sub-total of cash inflows 5,822,840,000.00 3,543,833,243.33
Repayments of borrowings 5,381,742,457.36 715,904,918.03
Dividends paid, profit distributed or interest paid 89,771,518.67 619,875.00
Cash paid relating to other financing activities 982,254.76 721,400,000.00
Sub-total of cash outflows 5,472,496,230.79 1,437,924,793.03
Net Cash Flows from Financing Activities 350,343,769.21 2,105,908,450.30
IV. Effect of Foreign Exchange Rate Changes on Cash and
-65,793.07 27,149.74
Cash Equivalents
V. Net Increase in Cash and Cash Equivalents 479,041,383.59 1,136,220,667.60
Add: Opening balance of Cash and Cash Equivalents 753,590,556.77 690,685,211.42
VI. Closing Balance of Cash and Cash Equivalents 1,232,631,940.36 1,826,905,879.02
The accompanying notes form part of the financial statements.
-8-
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
I. GENERAL INFORMATION OF THE COMPANY
China Merchants Port Group Company Limited was a stock limited company incorporated in
Shenzhen, Guangdong Province, on 16 January 1993.
The headquarters of the Company is located in Shenzhen, Guangdong Province. The Company
and its subsidiaries (collectively the "Group") are principally engaged in the rendering of port
service, bonded logistics services and other businesses such as property development and
investment.
The Company's and consolidated financial statements have been approved by the Board of
Directors on 30 August 2021.
See Note (VII) "Equity in other entities" for details of the scope of consolidated financial
statements in the current period. See Note (VI) "Changes in scope of consolidation" for details of
changes in the scope of consolidated financial statements in the current period.
II. BASIS OF PREPARATION OF FINANCIAL STATEMENTS
Basis of preparation of financial statements
The Group has adopted the Accounting Standards for Business Enterprises ("ASBE") issued by
the Ministry of Finance ("MoF"). In addition, the Group has disclosed relevant financial
information in accordance with Information Disclosure and Presentation Rules for Companies
Offering Securities to the Public No. 15 - General Provisions on Financial Reporting (Revised in
2014).
Going concern
As at 30 June 2021, the Group had total current liabilities in excess of total current assets of
RMB 4,988,808,531.03. On 30 June 2021, the Group had available and unused line of credit
amounting to RMB 44,924,971,453.51, which is greater than the balance of the ne t current
liabilities. The Group can obtain financial support from the available line of credit when needed.
Therefore, the financial statements have been prepared on a going concern basis.
Basis of accounting and principle of measurement
The Group has adopted the accrual basis of accounting. Except for certain financial instruments
which are measured at fair value, the Group adopts the historical cost as the principle of
measurement of the financial statements. Upon being restructured into a stock company, the fixed
assets and intangible assets initially contributed by the state-owned shareholders are recognized
based on the valuation amounts confirmed by the state-owned assets administration department.
Where assets are impaired, provisions for asset impairment are made in accordance with the
relevant requirements.
Where the historical cost is adopted as the measurement basis, assets are recorded at the amount
of cash or cash equivalents paid or the fair value of the consideration given to acquire them a t the
time of their acquisition. Liabilities are recorded at the amount of proceeds or assets received or
-9-
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
the contractual amounts for assuming the present obligation, or, at the amounts of cash or cash
equivalents expected to be paid to settle the liabilities in the normal course of business.
- 10 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
II. BASIS OF PREPARATION OF FINANCIAL STATEMENTS - continued
Basis of accounting and principle of measurement - continued
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, regardless of whether
that price is directly observable or estimated using valuation technique. Fair value measurement
and/or disclosure in the financial statements are determined according to the above basis.
Fair value measurements are categorized into Level 1, 2 or 3 based on the degree to which the
inputs to the fair value measurements are observable and the significance of the inputs to the fair
value measurement in its entirety, which are described as follows:
Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities that
the entity can access at the measurement date;
Level 2 inputs are inputs, other than quoted prices included within Level 1, that are
observable for the asset or liability, either directly or indirectly; and
Level 3 inputs are unobservable inputs for the asset or liability.
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES
All the following significant accounting policies and accounting estimates are based on
Accounting Standards for Business Enterprises ("ASBE").
1. Statement of compliance with the ASBE
The financial statements of the Company have been prepared in accordance with the ASBE, and
present truly and completely, the Company's and consolidated financial position as of 30 June
2021, and the Company's and consolidated results of operations, the Company's and consolidated
shareholders' equity and cash flows for the period from 1 January 2021 to 30 June 2021.
2. Accounting period
The Group has adopted the calendar year as its accounting year, e.g. from 1 January to 31
December.
3. Operating cycle
An operating cycle refers to the period since when an enterprise purchases assets for processing
purpose till the realization of those assets in cash or cash equivalents. The Group are principally
engaged in the rendering of port service, bonded logistics service and other business such as
property development and investment with an operating cycle of one year.
- 11 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
4. Functional currency
Renminbi ("RMB") is the currency of the primary economic environment in which the Company
and its domestic subsidiaries operate. Therefore, the Company and its domestic subsidiaries
choose RMB as their functional currency. The Company's subsidiaries choose their functional
currency on the basis of the primary economic environment in which they operate. The Company
adopts RMB to prepare its financial statements.
5. The accounting treatment of business combinations involving or not involving
enterprises under common control
Business combinations are classified into business combinations involving enterprises under
common control and business combinations not involving enterprises under common control.
5.1 Business combinations involving enterprises under common control
A business combination involving enterprises under common control is a business combination in
which all of the combining enterprises are ultimately controlled by the same party or parties both
before and after the combination, and that control is not transitory.
Assets and liabilities obtained shall be measured at their respective carrying amounts as recorded
by the combining entities at the date of the combination. The difference between the carrying
amount of the net assets obtained and the carrying amount of the consideration paid for the
combination is adjusted to the share premium in capital reserve. If the share premium is not
sufficient to absorb the difference, any excess shall be adjusted against retained earnings.
Costs that are directly attributable to the combination are charged to profit or loss in the period in
which they are incurred.
5.2 Business combinations not involving enterprises under common control and goodwill
A business combination not involving enterprises under common control is a business
combination in which all of the combining enterprises are not ultimately controlled by the same
party or parties before and after the combination.
The cost of combination is the aggregate of the fair values, at the acquisition date, of the assets
given, liabilities incurred or assumed, and equity securities issued by the acquirer, in exchange for
control of the acquire. Where a business combination not involving enterprises under common
control is achieved in stages that involve multiple transactions, the cost of combination is the sum
of the consideration paid at the acquisition date and the fair value at the acquisition date of the
acquirer's previously held interest in the acquiree. The intermediary expenses (fees in respect of
auditing, legal services, valuation and consultancy services, etc.) and other administrative
expenses attributable to the business combination are recognized in profit or loss in the periods
when they are incurred.
- 12 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
5. The accounting treatment of business combinations involving or not involving
enterprises under common control - continued
5.2 Business combinations not involving enterprises under common control and goodwill - continued
The acquiree's identifiable assets, liabilities and contingent liabilities acquired by the acquirer in a
business combination that meet the recognition criteria shall be measured at fair value at the
acquisition date.
When a business combination contract provides for the acquirer's recovery of consideration
previously paid contingent on one or multiple future event(s), the Group recognizes the contingent
consideration provided in the contract as an asset, as part of the consideration transferred in the
business combination, and includes it in the cost of business combination at the fair value at the
acquisition date. Within 12 months after the acquisition, where the contingent consideration needs
to be adjusted as new or further evidences are obtained in respect of the circumstances e xisted at
the acquisition date, the adjustment shall be recognized and the amount originally recognized in
goodwill or non-operating income shall be adjusted. A change in or adjustment to the contingent
consideration under other circumstances shall be accounted for in accordance with Accounting
Standard for Business Enterprise No. 22 - Financial Instruments: Recognition and Measurement
and Accounting Standard for Business Enterprises No. 13 - Contingencies. Any change or
adjustment is included in profit or loss for the current period.
Where the cost of combination exceeds the acquirer's interest in the fair value of the acquiree's
identifiable net assets, the difference is treated as an asset and recognized as goodwill, which is
measured at cost on initial recognition. Where the cost of combination is less than the acquirer's
interest in the fair value of the acquiree's identifiable net assets, the acquirer reassesses the
measurement of the fair values of the acquiree's identifiable assets, liabilities and c ontingent
liabilities and measurement of the cost of combination. If after that reassessment, the cost of
combination is still less than the acquirer's interest in the fair value of the acquiree's identifiable
net assets, the acquirer recognizes the remaining difference immediately in profit or loss for the
current period.
If either the fair values of identifiable assets, liabilities and contingent liabilities acquired in a
combination or the cost of business combination can be determined only provisionall y by the end
of the period in which the business combination was effected, the acquirer recognizes and
measures the combination using those provisional values. Any adjustments to those provisional
values within twelve months after the acquisition date are treated as if they had been recognized
and measured on the acquisition date.
Goodwill arising on a business combination is measured at cost less accumulated impairment
losses, and is presented separately in the consolidated financial statements.
- 13 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
6. Preparation of consolidated financial statements
6.1 Preparation of consolidated financial statements
The scope of consolidation in the consolidated financial statements is determined on the basis of
control. Control exists when the investor has power over the investee; is exposed, or has rights, to
variable returns from its involvement with the investee; and has the ability to use its power over
the investee to affect its returns. The Group reassesses whether or not it controls an investee if
facts and circumstances indicate that there are changes of the above elements of the definition of
control.
Consolidation of a subsidiary begins when the Group obtains control over the subsidiaries and
ceases when the Group loses control of the subsidiary.
For a subsidiary already disposed of by the Group, the operating results and cash flows before the
date of disposal (the date when control is lost) are included in the consolidated income statement
and consolidated statement of cash flows, as appropriate.
For subsidiaries acquired through a business combination involving enterprises not under
common control, the operating results and cash flows from the acquisition date (the date when
control is obtained) are included in the consolidated income statement and consolidated statement
of cash flows, as appropriate.
No matter when the business combination occurs in the reporting period, subsidiaries acquired
through a business combination involving enterprises under common control or the party being
absorbed under merger by absorption are included in the Group's scope of consolidation as if they
had been included in the scope of consolidation from the date when they first came under the
common control of the ultimate controlling party. Their operating results and cash flows from the
date when they first came under the common control of the ultimate controlling party are included
in the consolidated income statement and consolidated state ment of cash flows, as appropriate.
The significant accounting policies and accounting periods adopted by the subsidiaries are
determined based on the uniform accounting policies and accounting periods set out by the
Company.
Where the accounting policies / accounting periods adopted by subsidiaries are inconsistent with
those of the Company, appropriate adjustments are made to the subsidiaries' financial statements
in accordance with the accounting policies of the Company.
All significant intra-group balances and transactions are eliminated on consolidation.
- 14 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
6. Preparation of consolidated financial statements - continued
6.1 Preparation of consolidated financial statements - continued
The portion of subsidiaries' equity that is not attributable to the parent is treated as minority
interests and presented as "minority interests" in the consolidated balance sheet under
shareholders' equity. The portion of net profits or losses of subsidiaries for the period attributable
to minority interests is presented as "minority interests" in the consolidated income statement
under the "net profit" line item.
When the amount of loss for the period attributable to the minority shareholders of a subsidiary
exceeds the minority shareholders' portion of the opening balance of shareholders' equity of the
subsidiary, the excess amount is still allocated against minority interests.
Acquisition of minority interests or disposals of interests in a subsidiary that do not result in the
loss of control over the subsidiary are accounted for as equity transactions. The carrying amounts
of the parent's interests and minority interests are adjusted to reflect the changes in their relative
interests in the subsidiary. The difference between the amount by which the minority interests are
adjusted and the fair value of the consideration paid or received is adjusted to capital reserve. If
the capital reserve is not sufficient to absorb the difference, the excess are adjusted against
retained earnings.
For the stepwise acquisition of equity interest till acquiring control after a few transactions and
leading to business combination not involving enterprises under common control, this should be
dealt with based on whether this belongs to 'package deal': if it belongs to 'package deal',
transactions will be dealt as transactions to acquire control. If it does not belong to 'package deal',
transactions to acquire control on acquisition date will be under accounting treatment, the fair
value of acquirees' shares held before acquisition date will be revalued, and the difference
between fair value and book value will be recognized in profit or loss of the current period; if
acquirees' shares held before acquisition date involve in changes of other comprehensive income
and other equity of owners under equity method, this will be transferred to income of acquisition
date.
When the Group loses control over a subsidiary due to disposal of equity investment or other
reasons, any retained interest is remeasured at its fair value at the date when control is lost. The
difference between (i) the aggregate of the consideration received on disposal and the fair value of
any retained interest and (ii) the share of the former subsidiary's net assets cumulatively calculated
from the acquisition date according to the original proportion of ownership interests is recognized
as investment income in the period in which control is lost, and the goodwill is offset accordingly.
Other comprehensive income associated with investment in the former subsidiary is reclassified to
investment income in the period in which control is lost.
- 15 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
6. Preparation of consolidated financial statements - continued
6.1 Preparation of consolidated financial statements - continued
When the Group loses control of a subsidiary in two or more arrangements (transactions), terms
and conditions of the arrangements (transactions) and their economic effects are considered. One
or more of the following indicate that the Group shall account for the multiple arrangements as a
'package deal': (i) they are entered into at the same time or in contemplation of each other; (ii)
they form a complete transaction designed to achieve an overall commercial effect; (iii) the
occurrence of one transaction is dependent on the occurrence of at least one other transaction; (iv)
one transaction alone is not economically jus tified, but it is economically justified when
considered together with other transactions. Where the transactions of disposal of equity
investments in a subsidiary until the loss of control are assessed as a package deal, these
transactions are accounted for as one transaction of disposal of a subsidiary with loss of control.
Before losing control, the difference of consideration received on disposal and the share of net
assets of the subsidiary continuously calculated from acquisition date is recognized as other
comprehensive income. When losing control, the cumulated other comprehensive income is
transferred to profit or loss of the period of losing control. If the transactions of disposal of equity
investments in a subsidiary are not assessed as a package deal, these transactions are accounted
for as unrelated transactions.
7. Types of joint arrangements and the accounting treatment of joint operation
There are two types of joint arrangements - joint operations and joint ventures. The classification
of joint arrangements under is determined based on the rights and obligations of parties to the
joint arrangements by considering the structure, the legal form of the arrangements, the
contractual terms agreed by the parties to the arrangement. A joint operation is a joint
arrangement whereby the parties that have joint control of the arrangement have rights to the
assets, and obligations for the liabilities, relating to the arrangement. A joint venture is a joint
arrangement whereby the parties that have joint control of the arrangement have rights to the net
assets of the arrangement.
Investments in joint ventures are accounted for using the equity method by the Group, which is
detailed in Notes (III) 16.3.2, A long-term equity investment accounted for using the equity
method
The Group as a joint operator recognizes the following items in relation to its interest in a joint
operation: (1) its solely-held assets, including its share of any assets held jointly; (2) its solely-
assumed liabilities, including its share of any liabilities incurred jointly; (3) its revenue from the
sale of its share of the output arising from the joint operation; (4) its share of the revenue from the
sale of the output by the joint operation; and (5) its solely-incurred expenses, including its share of
any expenses incurred jointly. The Group accounts for the recognized assets, liabilities, revenues
and expenses relating to its interest in a joint operation in accordance with the requirements
applicable to the particular assets, liabilities, revenues and expenses.
- 16 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
8. Recognition criteria of cash and cash equivalents
Cash comprises cash on hand and deposits that can be readily withdrawn on demand. Cash
equivalents are the Group's short-term(generally due within 3 months since the acquisition date),
highly liquid investments that are readily convertible to known amounts of cash and which are
subject to an insignificant risk of changes in value.
9. Foreign currency transactions
9.1 Transactions denominated in foreign currencies
A foreign currency transaction is recorded, on initial recognition, by applying the spot exchange
rate on the date of the transaction.
At the balance sheet date, foreign currency monetary items are translated into functional currency
using the spot exchange rates at the balance sheet date. Exchange differences arising from the
differences between the spot exchange rates prevailing at the balance sheet date and those o n
initial recognition or at the previous balance sheet date are recognized in profit or loss for the
period, except that (1) exchange differences related to a specific-purpose borrowing denominated
in foreign currency that qualify for capitalization are capitalized as part of the cost of the
qualifying asset during the capitalization period; (2) exchange differences related to hedging
instruments for the purpose of hedging against foreign currency risks are accounted for using
hedge accounting; (3) exchange differences arising from changes in the carrying amounts (other
than the amortized cost) of monetary items at fair value through other comprehensive income are
recognized as other comprehensive income.
When the consolidated financial statements include foreign operation(s), if there is foreign
currency monetary item constituting a net investment in a foreign operation, exchange difference
arising from changes in exchange rates are recognized as "exchange differences arising on
translation of financial statements denominated in foreign currencies " in other comprehensive
income, and in profit and loss for the period upon disposal of the foreign operation.
Foreign currency non-monetary items measured at historical cost are translated to the amounts in
functional currency at the spot exchange rates on the dates of the transactions; the amounts in
functional currency remain unchanged. Foreign currency non-monetary items measured at fair
value are re-translated at the spot exchange rate on the date the fair value is determined.
Difference between the re-translated functional currency amount and the original functional
currency amount is treated as changes in fair value (including changes of exchange rate) and is
recognized in profit and loss or as other comprehensive income.
- 17 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
9. Foreign currency transactions - continued
9.2 Translation of financial statements denominated in foreign currencies
For the purpose of preparing the consolidated financial statements, financial statements of a
foreign operation are translated from the foreign currency into RMB using the following method:
assets and liabilities on the balance sheet are translated at the spot exchange rate prevailing at the
balance sheet date; shareholders' equity items except for unappropriated profit are translated at the
spot exchange rates at the dates on which such items arose; all items in the income statement as
well as items reflecting the distribution of profits are translated at the average exchange rates of
the accounting period of the consolidated financial statements; the opening balance of
unappropriated profit is the translated closing balance of the previous year's unappropriated profit;
the closing balance of unappropriated profit is calculated and presented on the basis of each
translated income statement and profit distribution item. The difference between the translated
assets and the aggregate of liabilities and shareholders' equity items is recogni zed as other
comprehensive income and included in shareholders' equity.
Cash flows arising from a transaction in foreign currency and the cash flows of a foreign
subsidiary are translated at average exchange rate during the accounting period of consolidated
financial statements. The effect of exchange rate changes on cash and cash equivalents is regarded
as a reconciling item and presented separately in the cash flow statement as "effect of exchange
rate changes on cash and cash equivalents".
The closing balances and the comparative figures of previous year are presented at the translated
amounts in the previous year's financial statements.
On disposal of the Group's entire interest in a foreign operation, or upon a loss of control over a
foreign operation due to disposal of certain interest in it or other reasons, the Group transfers the
accumulated exchange differences arising on translation of financial statements of this foreign
operation attributable to the owners' equity of the Company and presented under owners' equity,
to profit or loss in the period in which the disposal occurs.
In case of a disposal of part equity investments or other reason leading to lower interest
percentage in foreign operations but does not result in the Group losing control over a foreign
operation, the proportionate share of accumulated exchange differences arising on translation of
financial statements are re-attributed to minority interests and are not recognized in profit and loss.
For partial disposals of equity interests in foreign operations which are associates or joint ventures,
the proportionate share of the accumulated exchange differences arising on translation of financial
statements of foreign operations is reclassified to profit or loss.
- 18 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instrume nts
The Group recognizes a financial asset or a financial liability when it becomes a party to the
contractual provisions of a financial instrument.
All regular way purchases or sales of financial assets are recognized and derecognized on a trade
date basis.
Financial assets and financial liabilities are initially measured at fair value. For financial assets
and financial liabilities at fair value through profit or loss, relevant transaction costs are directly
recognized in profit or loss; transaction costs relating to other categories of financial assets and
financial liabilities are included in the value initially recognized. For accounts receivable
recognized that do not contain a significant financing component or a financing component
included in the contracts less than one year which are not considered by the Group, which are
within the scope of Accounting Standard for Business Enterprises No.14 - Revenue (hereinafter
referred to as "revenue standards"), transaction prices defined in the standards shall be adopted on
initial recognition.
The effective interest method is a method that is used in the calculation of the amortized cost of a
financial asset or a financial liability and in the allocation of the interest income or interest
expense in profit or loss over the relevant period.
The effective interest rate is the rate that exactly discounts estimated future cash flows through the
expected life of the financial asset or financial liability to the gross carrying amount of a financial
asset or to the amortized cost of a financial liability. When calculating the effective interest rate,
the Group estimates future cash flows by considering all the contractual terms of the financial
asset or financial liability (for example, prepayment, extension, call option or similar options) but
shall not consider the expected credit losses.
The amortized cost of a financial asset or a financial liability is the amount o f a financial asset or a
financial liability initially recognized net of principal repaid, plus or less the cumulative amortized
amount arising from amortization of the difference between the amount initially recognized and
the amount at the maturity date using the effective interest method, net of cumulative credit loss
allowance (only applicable to financial assets).
10.1 Classification, recognition and measurement of financial assets
Subsequent to initial recognition, the Group's financial assets of various categories are
subsequently measured at amortized cost, at fair value through other comprehensive income or at
fair value through profit or loss.
If contractual terms of the financial asset give rise on specified dates to cash flows that are solely
payments of principal and interest on the principal amount outstanding, and the financial asset is
held within a business model whose objective is to hold financial assets in order to collect
contractual cash flows, such asset is classified into financial assets measured at amortized cost,
which include cash and bank balances, notes receivable, accounts receivable, other receivables,
debt investments, and long-term receivables and etc.
- 19 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instrume nts - continued
10.1 Classification, recognition and measurement of financial assets - continued
Financial assets that meet the following conditions are subsequently measured at fair value
through other comprehensive income ("FVTOCI"): the financial asset is held within a business
model whose objective is achieved by both collecting contractual cash flows and selling; and the
contractual terms of the financial asset give rise on specified dates to cash fl ows that are solely
payments of principal and interest on the principal amount outstanding. Financial assets at
FVTOCI are presented as other debt investments. Other debt investments due within one year
(inclusive) since the balance sheet date are presented as non-current assets due within one year.
Other debt investments due within one year (inclusive) upon acquisition are presented as other
current assets.
On initial recognition, the Group may irrevocably designate non-trading equity instruments, other
than contingent consideration recognized through business combination not involving enterprises
under common control, as financial assets at FVTOCI on an individual basis. Such financial
assets at FVTOCI are presented as other equity instrument.
A financial asset is classified as held for trading if one of the following conditions is satisfied:
It has been acquired principally for the purpose of selling in the near term; or
On initial recognition it is part of a portfolio of identified financial instruments that the Group
manages together and there is objective evidence that the Group has a recent actual pattern of
short-term profit-taking; or
It is a derivative that is not a financial guarantee contract or designated and effective as a hedging
instrument.
Financial assets measured at fair value through profit or loss ("FVTPL") include those classified
as financial assets at FVTPL and those designated as financial assets at FVTPL.
Any financial assets that does not qualify for amortized cost measurement or measurement at
FVTOCI or designated at FVTOCI are classified into financial assets at FVTPL.
Upon initial recognition, in order to eliminate or significantly reduce accounting mismatch and
qualified hybrid financial instrument combines financial asset with embedded derivatives, the
Group will irrevocably designated it as financial liabilities at FVTPL.
Financial assets at FVTPL assets other than derivative financial assets are presented as "held -for-
trading financial assets". Such financial assets at FVTPL which may fall due more than one year
(or without fixed term) since the balance sheet date and will be held more than one year are
presented as other non-current financial assets.
10.1.1 Financial assets measured at amortized cost
- 20 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
Financial assets measured at amortized cost are subsequently measured at amortized cost using the
effective interest method. Gain or loss arising from impairment or derecognition is recognized in
profit or loss.
- 21 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instrume nts - continued
10.1 Classification, recognition and measurement of financial assets - continued
10.1.1 Financial assets measured at amortized cost - continued
For financial assets measured at amortized cost, the Group recognizes interest income using
effective interest method. The Group calculates and recognizes interest income through book
value of financial assets multiplying effective interest, except for the following circumstances:
For purchased or originated credit-impaired financial assets with credit impairment, the Group
calculates and recognizes its interest income based on amortized cost of the financial asset and the
effective interest through credit adjustment since initial recognition.
10.1.2 Financial assets at FVTOCI
Impairment losses or gains related to financial assets at FVTOCI, interest income measured using
effective interest method and exchange gains or losses are recognized into profit or loss for the
current period, except for the above circumstances, changes in fair value of the financial assets are
included in other comprehensive income. Amounts charged to profit or loss for every period equal
to the amount charged to profit or loss as it is measured at amortized costs. When the financial
asset is derecognized, the cumulative gains or losses previously recognized in other
comprehensive income shall be removed from other comprehensive income and recognized in
profit or loss.
Changes in fair value of non-trading equity instrument investments designated as financial assets
at FVTOCI are recognized in other comprehensive income, and the cumulative gains or losses
previously recognized in other comprehensive income allocated to the part derecognized are
transferred and included in retained earnings. During the period in which the Group holds the
non-trading equity instrument, revenue from dividends is recognized in profit or loss for the
current period when (1) the Group has established the right of collecting dividends; (2) it is
probable that the associated economic benefits will flow to the Group; and (3) the amount of
dividends can be measured reliably.
10.1.3 Financial assets at FVTPL
Financial assets at FVTPL are subsequently measured at fair value. Gain or loss aris ing from
changes in fair values and dividends and interests related to the financial assets are recognized in
profit or loss.
- 22 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instrume nts - continued
10.2 Impairment of financial instruments
The Group makes accounting treatment on impairment and recognizes loss allowance for
expected credit losses ("ECL") on financial assets measured at amortized cost, financial assets
classified as at FVTOCI, lease receivables, contract assets, loan commitments that are not
financial liabilities at FVTPL, financial liabilities not measured at FVTPL, financial guarantee
contracts arising from transfer of financial assets which does not satisfy derecognition criteria o r
continuing involvement of transferred financial assets.
The Group makes a loss allowance against amount of lifetime ECL of the contract assets, notes
receivable and accounts receivable arising from transactions adopting the Revenue Standard as
well as lease receivables arising from transactions adopting ASBE No. 21- Leases.
For other financial instrument, other than purchased or originated credit-impaired financial assets,
the Group assesses changes in credit risks of the relevant financial asset since initial recognition at
each balance sheet date. If the credit loss of the financial instrument has been significantly
increased since initial recognition, the Group will make a loss allowance at an amount of expected
credit loss during the whole life; if not, the Group will make a loss allowance for the financial
instrument at an amount in the future 12-month expected credit losses. Except for the financial
assets classified as at FVTOCI, increase in or reversal of credit loss allowance is included in profi t
or loss as loss/gain on impairment. For the financial assets classified as at FVTOCI, the Group
recognizes credit loss allowance in other comprehensive income and recognizes the loss/gain on
impairment in profit or loss, while the Group does not decrease the carrying amount of such
financial assets in the balance sheet.
The Group has makes a loss allowance against amount of expected credit losses during the whole
life in the prior accounting period. However, at the balance sheet date, the credit risk on a
financial instrument has not increased significantly since initial recognition; the Group will
measure the loss allowance for that financial instrument at an amount in the future 12-month
expected credit losses. Reversed amount of loss allowance arising from such circumstances shall
be included in profit or loss as impairment gains.
10.2.1 Significant increase of credit risk
In assessing whether the credit risk has increased significantly since initial recognition, the Group
compares the risk of a default occurring on the financial instrument as at the reporting date with
the risk of a default occurring on the financial instrument as at the date of initial recognition. For
loan commitments, the date that the Group becomes a party to the irrevocable commitment is
considered to be the date of initial recognition in the application of criteria related to the financial
instrument for impairment.
In particular, the following information is taken into account when assessing whether credit risk
has increased significantly:
- 23 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instrume nts - continued
10.2 Impairment of financial instruments - continued
10.2.1 Significant increase of credit risk - continued
(1) Significant changes in internal price indicators of credit risk as a result of a change in credit
risk;
(2) Other changes in the rates or terms of an existing financial instrument that would be
significantly different if the instrument was newly originated or issued at the balance sheet
date (such as more stringent covenants, increased amounts of collateral or guarantees, or
higher income coverage).
(3) Significant changes in external market indicators of credit risk for a particular financial
instrument or similar financial instruments with the same expected life. These indicators
include the credit spread, the credit swap prices for the borrower, the length of time or the
extent to which the fair value of a financial asset has been less than its amortized cost and
other market information related to the borrower, such as changes in the price of a
borrower's debt and equity instruments.
(4) Significant changes in actual or expected external credit rating for the financial instruments;
(5) An actual or expected internal credit rating downgrade for the borrower
(6) Adverse changes in business, financial or economic conditions that are expected to cause a
significant change in the debtor's ability to meet its debt obligations;
(7) An actual or expected significant change in the operating results of the debtor;
(8) Significant increases in credit risk on other financial instruments of the same borrower;
(9) Significant adverse change in the regulatory, economic, or technological environment of the
debtor;
(10) Significant changes in the value of the collateral supporting the obligation or in the quality
of third-party guarantees or credit enhancements, which are expected to reduce the debtor's
economic incentive to make scheduled contractual payments or to otherwise have an effect
on the probability of a default occurring.
(11) Significant changes in circumstances expected to reduce the debtor's economic incentive to
make scheduled contractual payments;
(12) Expected changes in the loan documentation including an expected breach of contract that
may lead to covenant waivers or amendments, interest payment holidays, interest rate step-
ups, requiring additional collateral or guarantees, or other changes to the contractual
framework of the financial instrument;
(13) Significant changes in the expected performance and behavior of the debtor;
(14) Changes in the entity's credit management approach in relation to the financial instrument;
(15) Past due of contract payment.
The Group assumes that the credit risk on a financial instrument has not increased significantly
since initial recognition if the financial instrument is determined to have lower credit risk at the
balance sheet date. A financial instrument is determined to have lower credit risk if: i) it has a
lower risk of default, ii) the borrower has a strong capacity to meet its contractual cash flow
obligations in the near term and iii) 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.
- 24 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instrume nts - continued
10.2 Impairment of financial instruments - continued
10.2.2 Credit-impaired financial assets
When the Group expected occurrence of one or more events which may cause adverse impact on
future cash flows of a financial asset, the financial asset will become a credit-impaired financial
assets. Objective evidence that a financial asset is impaired includes but not limited to the
following observable events:
(1) Significant financial difficulty of the issuer or debtor;
(2) A breach of contract by the debtor, such as a default or delinquency in interest or principal
payments;
(3) The creditor, for economic or legal reasons relating to the debtor's financial difficulty,
granting a concession to the debtor;
(4) It becoming probable that the debtor will enter bankruptcy or other financial reorganizations;
(5) The disappearance of an active market for that financial asset because of financial
difficulties of the issuer or the debtor;
(6) Purchase or originate a financial asset with a large scale of discount, which reflects facts of
credit loss incurred.
10.2.3 Determination of expected credit loss
Lease receivables are assessed for ECL individually by the Group. In addition, the Group uses
provision matrix to calculate ECL for notes receivable, accounts receivable, other receivables,
contract assets, debt investments and other debt investments based on a portfolio basis. The Group
classifies financial instruments into different groups based on common risk characteristics.
Common credit risk characteristics include credit risk rating, the date of initial recognition,
remaining contractual maturity, industry of borrower and geographical location of the borrower
etc.
The Group determines expected credit losses of relevant financial instruments using the following
methods:
For a financial asset, a credit loss is the present value of the difference between the
contractual cash flows that are due to the Group under the contract and the cash flows that
the Group expects to receive;
For a lease receivable, a credit loss is the present value of the difference between the
contractual cash flows that are due to the Group under the contract and the cash flows that
the Group expects to receive;
- 25 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instrume nts - continued
10.2 Impairment of financial instruments - continued
10.2.3 Determination of expected credit loss - continued
For undrawn loan commitments (refer to Note III, 10.4.1.3 for the detail of accounting
policies), the ECL is the present value of the difference between the contractual cash flows
that are due to the Group if the holder of the loan commitments draws down the loan, and
the cash flows that the Group expects to receive if the loan is drawn down. The Group's
estimation of the ECL for loan commitments is consistent with its expectation of the loan
commitments drawn down.
For a financial guarantee contract (refer to Note III, 10.4.1.3 for the detail of accounting
policies ), the expected losses is the present value of the expected payments to reimburse the
holder for a credit loss that it incurs less any amounts that the Group expects to receive from
the holder, the debtor or any other party.
For a financial asset with credit-impaired at the balance sheet date, but not purchased or
originated credit-impaired, a credit losses is the difference between the asset's gross carrying
amount and the present value of estimated future cash flows discounted at the financial
asset's original effective interest rate.
The factors reflected in methods of measurement of expected credit losses include an unbiased
and probability-weighted amount that is determined by evaluating a range of possible outcomes;
time value of money; reasonable and supportable information about past events, current
conditions and forecasts on future economic status at balance sheet date without unnecessary
additional costs or efforts.
10.2.4 Write-down of financial assets
When the Group will no longer reasonably expect that the contractual cash flows of financial
assets can be collected in aggregate or in part, the Group will directly write down the carrying
amount of the financial asset, which constitutes derecognition of relevant financial assets.
10.3 Transfer of financial assets
The Group will derecognize a financial asset if one of the following conditions is satisfied: (i) the
contractual rights to the cash flows from the financial asset expire; (ii) the financial asset has been
transferred and substantially all the risks and rewards of ownership of the financial asset is
transferred to the transferee; or (iii) although the financial asset has been transferred, the Group
neither transfers nor retains substantially all the risks and rewards of ownership of the financial
asset but has not retained control of the financial asset.
- 26 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instrume nts - continued
10.3 Transfer of financial assets - continued
If the Group neither transfers nor retains substantially all the risks and rewards of ownership of a
financial asset, and it retains control of the financial asset, the Group will recognize the financial
asset to the extent of its continuing involvement in the transferred financial asset and recognize an
associated liability. The Group will measure relevant liabilities as follows:
For transferred financial assets carried at amortized cost, the carrying amount of relevant
liabilities is the carrying amount of financial assets transferred with continuing involvement
less amortized cost of the Group's retained rights (if the Group retains relevant rights upon
transfer of financial assets) with addition of amortized cost of obligations assumed by the
Group (if the Group assumes relevant obligations upon transfer of financial assets). Relevant
liabilities are not designated as financial liabilities at fair value through profit or loss.
For transferred financial assets carried at fair value, the carrying amount of relevant
financial liabilities is the carrying amount of financial assets transferred with continuing
involvement less fair value of the Group's retained rights (if the Group retains relevant rights
upon transfer of financial assets) with addition of fair value of obligations assumed by the
Group (if the Group assumes relevant obligations upon transfer of financial assets).
Accordingly, the fair value of relevant rights and obligations shall be measured on an
individual basis.
For a transfer of a financial asset in its entirety that satisfies the derecognition criteria, the
difference between (1) the carrying amount of the financial asset transferred and (2) the sum of
the consideration received from the transfer and accumulated changes in fair value initially
recorded in other comprehensive income is recognized in profit or loss. For the non-tradable
equity instrument designated as financial assets at FVTOCI, cumulative gain or loss that has been
recognized in other comprehensive income should be removed from other comprehensive income
but be recognized in retained earnings.
For a part of transfer of a financial asset that satisfies the derecognition criteria, the carrying
amount of the transferred financial asset is allocated between the part that is derecognized and the
part that is continuously involved, based on the respective fair values of those parts on transfer
date. The difference between (1) the sum of the consideration received for the part derecognized
and any cumulative gain or loss allocated to the part derecognized which has been previously
recognized in other comprehensive income; and (2) the carrying amount allocated to the part
derecognized on derecognition date; is recognized in profit or loss. For the non-tradable equity
instrument designated as financial assets at FVTOCI, cumulative gain or loss that has been
recognized in other comprehensive income should be removed from other comprehensive income
but be recognized in retained earnings.
For a transfer of a financial asset in its entirety that does not satisfy the derecognition criteria, the
Group will continuously recognize the transferred financial asset in its entirety. Considerations
received due to transfer of assets should be recognized as a liability upon receipts.
- 27 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instrume nts - continued
10.4 Classification of financial liabilities equity instruments
Financial instruments issued by the Group are classified into financial liabilities or equity
instruments on the basis of the substance of the contractual arrangements and the economic nature
not only its legal form, together with the definition of financial liability and equity instruments on
initial recognition.
10.4.1 Classification, recognition and measurement of financial liabilities
On initial recognition, financial liabilities are classified into financial l iabilities at FVTPL and
other financial liabilities.
10.4.1.1 Financial liabilities at FVTPL
Financial liabilities at FVTPL consist of financial liabilities held for trading (including derivatives
classified as financial liabilities) and those designated as at FVTPL. Except for derivative
financial liabilities presented separately, the financial liabilities at FVTPL are presented as held -
for-trading financial liabilities.
A financial liability is classified as held for trading if one of the following conditions is satisfied:
It has been acquired principally for the purpose of repurchasing in the near term; or
On initial recognition it is part of a portfolio of identified financial instruments that the
Group manages together and there is objective evidence that the Group has a recent actual
pattern of short-term profit-taking; or
It is a derivative that is not a financial guarantee contract or designated and effective as a
hedging instrument.
A financial liability may be designated as at FVTPL on initial recognition when one of the
following conditions is satisfied: (i) Such designation eliminates or significantly reduces
accounting mismatch; or (ii) The Group makes management and performance evaluation on a fair
value basis, in accordance with the Group's formally documented risk management or investment
strategy, and reports to key management personnel on that basis. (iii) The qualified hybrid
financial instrument combines financial asset with embedded derivatives.
Transaction financial liabilities are subsequently measured at fair value. Any gains or losses
arising from changes in the fair value and any dividend or interest expenses paid on the financial
liabilities are recognized in profit or loss.
- 28 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instrume nts - continued
10.4 Classification of financial liabilities equity instruments - continued
10.4.1 Classification, recognition and measurement of financial liabilities - continued
10.4.1.1 Financial liabilities at FVTPL - continued
The amount of change in the fair value of the financial liability that is attributable to changes in
the credit risk of that liability shall be presented in other comprehensive income, other changes in
fair values are included in profit or loss for the current period. Upon the derecognition of such
liability, the accumulated amount of change in fair value that is attributable to changes in the
credit risk of that liability, which is recognized in other comprehensive income, is transferred to
retained earnings. Any dividend or interest income earned on the financial liabilities are
recognized in profit or loss. If the impact of the change in credit risk of such financial liability
dealt with in the above way would create or enlarge an accounting mismatch in profit or loss, the
Group shall present all gains or losses on that liability (including the effects of changes in the
credit risk of that liability) in profit or loss.
Financial liabilities are measured at FVTPL when the financial liabilities is arising from
contingent consideration recognized by the Group as an acquirer in a business combination not
involving enterprises under common control.
10.4.1.2 Other financial liabilities
Except for financial liabilities, financial guarantee contracts and loan commitments arising from
transfer of financial assets that do not meet the derecognition criteria or those arising from
continuing involvement in the transferred financial assets, other financial liabilities are
subsequently measured at amortized cost, with gain or loss arising from derecognition or
amortization recognized in profit or loss.
That the Group and its counterparty modify or renegotiate the contract does not result in
derecognition of a financial liability subsequently measured at amortized cost but result in
changes in contractual cash flows, the Group will recalculate the carrying amount of the financial
liability, with relevant gain or loss recognized in profit or loss. The Group will determine carryi ng
amount of the financial liability based on the present value of renegotiated or modified contractual
cash flows discounted at the financial liability's original effective interest rate. For all costs or
expenses arising from modification or renegotiatio n of the contract, the Group will adjust the
modified carrying amount of the financial liability and make amortization during the remaining
term of the modified financial liability.
- 29 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instrume nts - continued
10.4 Classification of financial liabilities equity instruments - continued
10.4.1 Classification, recognition and measurement of financial liabilities - continued
10.4.1.3 Financial guarantee contracts and loan commitments
A financial guarantee contract is a contract that requires the issuer to make specified payments to
reimburse the holder of the contract for a loss it incurs because a specified debtor fails to make
payment when due in accordance with the original or modified terms of a debt instrument.
Subsequent to initial recognition, financial guarantee contracts that are not designated as financial
liabilities at fair value through profit or loss or financial liabilities arising from tr ansfer of
financial assets that do not meet the derecognition criteria or those arising from continuing
involvement in the transferred financial assets, and loan commitments to provide a loan at a
below-market interest rate, which are not designated at fair value through profit or loss, are
measured at the higher of: (1) amount of loss provision; and (2) the amount initially recognized
less cumulative amortization amount determined based on the revenue standard.
10.4.2 Derecognition of financial liabilities
The Group derecognizes a financial liability (or part of it) when the underlying present obligation
(or part of it) is discharged. An agreement between the Group (the debtor) and the creditor to
replace the original financial liability with a new financial liability with substantially different
terms is accounted for as an extinguishment of the original financial liability and the recognition
of a new financial liability.
When the Group derecognizes a financial liability or a part of it, it recognizes the difference
between the carrying amount of the financial liability (or part of the financial liability)
derecognized and the consideration paid (including any non-cash assets transferred or new
financial liabilities assumed) in profit or loss.
10.4.3 Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of the Group
after deducting all of its liabilities. Equity instruments issued (including refinanced), repurchased,
sold and cancelled by the Group are recognized as changes of equity. Changes of fair value of
equity instruments is not recognized by the Group. Transaction costs related to equity transactions
are deducted from equity.
The Group recognizes the distribution to holders of the equity instruments as distribution of
profits, dividends paid do not affect total amount of shareholders' equity.
- 30 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instrume nts - continued
10.5 Derivatives and embedded derivatives
Derivatives include forward exchange contracts, currency swaps, interest rate swaps and foreign
exchange options, etc. Derivatives are initially measured at fair value at the date when the
derivative contracts are entered into and are subsequently remeasured at fair value.
Derivatives embedded in hybrid contracts with a financial asset host are not separated by the
Group. The hybrid contract shall apply to the relevant accounting standards regarding the
classification of financial assets as a whole.
Derivatives embedded in hybrid contracts with hosts that are not financial assets are separated and
treated as separate derivatives by the Group when they meet the following conditions:
(1) the economic characteristics and risks of the embedded derivative are not closely related to
those of the host contract;
(2) a separate instrument with the same terms as the embedded derivative would meet the
definition of a derivative.
(3) the hybrid contracts are not measured at fair value through profit or loss.
For the embedded derivative separated from the host contracts, the Group accounts for the host
contracts in the hybrid contracts with applicable accounting standards. When the embedded
derivatives whose fair value cannot be measured reliably by the Group according to the terms and
conditions of the embedded derivatives, the fair value of such derivatives are measured at the
difference between the fair value of the hybrid contracts and the fair value of the host contracts.
By adopting the above method, if the embedded derivative cannot be measured on a stand-alone
basis at the time when acquired or at subsequent balance sheet dates, the hybrid instrument is
designated as financial instruments at fair value through profit or loss as a whole.
10.6 Offsetting financial assets and financial liabilities
Where the Group has a legal right that is currently enforceable to set off the recognized financial
assets and financial liabilities, and intends either to settle on a net basis, or to realize the financial
asset and settle the financial liability simultaneously, a financial asset and a financial liability shall
be offset and the net amount is presented in the balance sheet. Except for the above circumstances,
financial assets and financial liabilities shall be presented separately in the balance sheet and shall
not be offset.
10.7 Reclassification of financial instruments
When the Group changes the business model to manage the financial assets, the financial assets
affected will be reclassified and no financial liabilities will be reclassified.
- 31 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
10. Financial instrume nts - continued
10.7 Reclassification of financial instruments - continued
The financial assets are reclassified by the Group and are accounted for prospectively since the
date of reclassification (i.e. the first date of the initial reporting period after the business model of
which the financial assets are reclassified by the enterprise is changed).
Where a financial asset at amortized cost is reclassified as a financial assets at fair value through
profit or loss ("FVTPL") by the Group, such financial asset is measured at fair value at the date of
reclassification and the difference between the original carrying amount and the fair value is
recognized in profit or loss for the period.
Where a financial asset at amortized cost is reclassified as a financial asset at fair value through
other comprehensive income ("FVTOCI") by the Group, such financial asset is measured at the
fair value at the date of reclassification, and the difference between the original amount and the
fair value is recognized in other comprehensive income.
Where a financial asset at FVTOCI is reclassified as a financial asset at amortized cost by the
Group, the accumulated gains or losses previously recognized in other comprehensive income are
transferred out and the fair value is adjusted as the fair value at the date of reclassification. The
adjusted fair value is recognized as the new carrying amount, as if the financial asset had been
measured at amortized cost.
Where a financial asset at FVTOCI is reclassified as a financial asset at FVTPL by the Group,
such financial asset continues to be accounted for at fair value. At the same time, the accumulated
gains or losses previously recognized in other comprehensive income are transferred to profit or
loss for the period.
Where a financial asset at FVTPL is reclassified as a financial asset at amortized cost by the
Group, the fair value at the date of reclassification is recognized as the new account balance.
Where a financial asset at FVTPL is reclassified as a financial asset at FVTOCI by the Group,
such financial asset continues to be measured at fair value.
Where a financial asset at FVTPL is reclassified, the effective interest rate is determined on the
basis of the fair value of the financial asset at the date of reclassification.
- 32 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
11. Accounts receivable
The Group makes internal credit ratings on customers and determines expected losses rate of
notes receivable, accounts receivable and other receivables. Basis for determining ratings and the
expected losses rates are as follows:
Internal credit rating Basis for determining portfolio Average expected loss rate (%)
Customers can make repayments within credit term and
have good credit records based on historical
A 0.00-0.10
experience. The probability of unpayment of due
amount are extremely low in the foreseeable future.
The customer may have overdue payment based on
B 0.10-0.30
historical experience but they can make repayments.
The evidences indicate that the overdue credit risks of
C the customer are significantly increased and there is 0.30-50.00
probability of unpayment and default.
The evidences indicate that the accounts receivable are
impaired or the customer has significant financial
D 50.00-100.00
difficulty. The amounts cannot be recovered in the
foreseeable future.
12. Accounts receivable financing
Notes receivable classified to hedging instruments for the purpose of hedging, should be listed as
accounts receivable financing within one year (including one year). If the term above one year, it
should be listed as other investment on bonds. Related accounting policies refer to Note III 10.
13. Inventories
13.1 Categories of inventories
Inventories include raw materials, merchandise and others. Inventories are initially measured at
cost. Cost of inventories comprises all costs of purchase, costs of conversion and other
expenditures incurred in bringing the inventories to their present location and condition.
13.2 Valuation method of inventories upon delivery
The actual cost of inventories upon delivery is calculated using the weighted average method.
- 33 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
13. Inventories - continued
13.3 Basis for determining net realizable value of inventories and provision methods for
decline in value of inventories
At the balance sheet date, inventories are measured at the lower of cost and net realizable value. If
the cost of inventories is higher than the net realizable value, a provision for decline in value of
inventories is made. Net realizable value is the estimated selling price in the ordinary course of
business less the estimated costs of completion, the estimated costs necessary to make the sale and
relevant taxes. Net realizable value is determined on the basis of clear evidence obtained, after
taking into consideration the purposes of inventories being held and effect of post balance sheet
events.
Provision for decline in value of other inventories is made based on the excess of cost of
inventory over its net realizable value on an item-by-item basis.
After the provision for decline in value of inventories is made, if the circumstances that
previously caused inventories to be written down below cost no longer exist so that the net
realizable value of inventories is higher than their cost, the original provision for decline in value
is reversed and the reversal is included in profit or loss for the period.
13.4 Inventory count system
The perpetual inventory system is maintained for stock system.
13.5 Amortization methods for low cost and short-lived consumable items and packaging
materials
Packaging materials and low cost and short-lived consumable items are amortized using the
immediate write-off method.
14. Contract assets
14.1 Recognition and criteria of contract assets
A contract asset represents the Group's right to consideration in exchange for goods or services
that the Group has transferred to a customer, and such right depends on factors other than the
passage of time. The Group's unconditional right (only the passage of time is required) to
consideration from the customer is separately presented as " accounts receivable".
14.2 Determination and accounting treatments of expected credit losses ("ECL") for contract
assets
Refer to Note III, 10.2 "Impairment of financial instruments" for determination and accounting
treatments of expected credit losses for contract assets.
- 34 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
15. Assets held for sale
When the Group withdraw the book value of certain assets or disposal group mainly through
disposal instead of continual application, the assets should be classified as held-for-sale assets.
Assets or disposal group classified as held-for-sale assets should meat following conditions: (1)
The current status is available for immediate distribution according to similar transactions of this
category of assets or disposal group; (2) The transaction is likely to occur, i.e. the Group has made
its resolution over the distribution arrangements and acquired purchase commitment. Also the
distribution is going to be fulfilled within a year.
If the holding company loses control of its subsidiary for reasons like subsidiary disposal, in
regardless of whether the holding company still keeps part of equity investment, once the
proposed investment disposal meets the requirements of being classified as available for sale
assets in the holding company's individual statement, all assets and liabilities of the subsidiary
should be classified as held-for-sale in consolidated financial statement.
The group's non-current assets and disposal group are measured at the lower of book value and
the net value of fair value less costs to sell. Once the book value is higher than the net value of
fair value less costs to sell, the book value should be adjusted to the net value and the excess
should be recognized as impairment losses and provision for held-for-sale assets impairment
should be made. A gain and a reverse in the previous provision for held-for-sale assets impairment
can be recognized for any increase in fair value less costs to sell at subsequent balance sheet dates,
to the extent that it is not in excess of the cumulative impairment loss that has been recognized.
Asset impairment losses recognized before such assets are classified as held for sale will not be
reversed.
Non-current held-for-sale assets is not subject to depreciation and amortization. The creditor
interest and other expenses of disposal group classified as held-for-sale asset should still be
recognized.
Once the associate or joint venture equity investment is completely or partly classified as held -
for-sale assets, the classified part of the investment is not subject to equity method measurement.
If an asset or a disposal group has been classified as held for sale but the recognition criteria for
non-current assets held for sale are no longer met, the Group shall cease to classify the asset or
disposal group as held for sale. It shall be measured at the lower of (1) the carryi ng amount before
the asset or disposal group was classified as held for sale, adjusted for any depreciation,
amortization or impairment that would have been recognized had the asset or disposal group not
been classified as held for sale; and (2) the recoverable amount at the date of the decision not to
sell.
For equity investments in associates or joint ventures that are classified as held for sale but the
recognition for non-current assets held for sale are no longer met, such investments are accounted
for retrospectively using the equity method from the date when they classified as held for sale.
The financial statements for the held-for-sale period are adjusted accordingly.
- 35 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
16. Long-term equity investments
16.1 Basis for determining joint control and significant influence over investee
Control is archived when the Group has the power over the investee and has rights to variable
returns from its involvement with the investee; and has the ability to use its power to affect its
returns. Joint control is the contractually agreed sharing of control over an economic activity, and
exists only when the strategic financial and operating policy decisions relating to the activity
require the unanimous consent of the parties sharing control. Significant influence is the power to
participate in the financial and operating policy decisions of the investee but is not control or joint
control over those policies. When determining whether an investing enterprise is able to exercise
control or significant influence over an investee, the effect of potential voting rights of the
investee (for example, warrants and convertible debts) held by the investing enterprises or other
parties that are currently exercisable or convertible shall be considered.
16.2 Determination of investment cost
For a long-term equity investment acquired through a business combination involving enterprises
under common control, the investment cost of the long-term equity investment is the attributable
share of the carrying amount of the shareholders' equity of the acquiree at the date of combination.
The difference between the initial investment cost and the carrying amount of cash paid, non-cash
assets transferred and liabilities assumed shall be adjusted to capital reserve. If the balance of
capital reserve is not sufficient, any excess shall be adjusted to retained earnings. If the
consideration of the combination is satisfied by the issue of equity securities, the initial
investment cost of the long-term equity investment shall be the share of party being absorbed of
the owners' equity in the consolidated financial statements of the ultimate controlling party at the
date of combination. The aggregate face value of the shares issued shall be accounted for as share
capital. The difference between the initial investment cost and the aggregate face value of the
shares issued shall be adjusted to capital reserve. If the balance of capital reserve is not suffic ient,
any excess shall be adjusted to retained earnings. Where equity interests in an acquiree are
acquired in stages through multiple transactions ultimately constituting a business combination
involving entities under common control, the acquirer shall determine if these transactions are
considered to be a "package deal". If yes, these transactions are accounted for as a single
transaction where control is obtained. If no, the initial investment cost of the long-term equity
investment is the share of book value of owners' equity of the acquired entity in the ultimate
controlling party's consolidated financial statements at the date of combination. The difference
between the initial investment cost and the sum of carrying amount of equity investments
previously held in the acquiree and the new investment cost is adjusted to capital reserve. If the
balance of capital reserve is not sufficient to absorb the difference, any excess is adjusted to
retained earnings. Other comprehensive income recognized for the previously held equity
investments by accounting treatment of equity method or available-for-sale financial assets is not
subject to accounting treatment temporarily.
For a long-term equity investment acquired through business combination not involving
enterprises under common control, the investment cost of the long-term equity investment
acquired is the cost of acquisition.
- 36 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
16. Long-term equity investments - continued
16.2 Determination of investment cost - continued
The absorbing party's or purchaser's intermediary expenses (fees in respect of auditing, legal
services, valuation and consultancy services, etc.) and other administrative expenses attributable
to the business combination are recognized in profit or loss in the periods when they are incurred.
The long-term equity investment acquired otherwise than through a business combination is
initially measured at its cost. When the entity is able to exercise significant influence or joint
control (but not control) over an investee due to additional investment, the cost of long-term
equity investments is the sum of the fair value of previously-held equity investments determined
in accordance with Accounting Standard for Business Enterprises No.22 - Financial Instruments:
Recognition and Measurement (ASBE No. 22) and the additional investment cost.
16.3 Subsequent measurement and recognition of profit or loss
16.3.1 A long-term equity investment accounted for using the cost method
Long-term equity investments in subsidiaries are accounted for using the cost method in the
Company's separate financial statements. A subsidiary is an investee that is controlled by the
Group.
Under the cost method, a long-term equity investment is measured at initial investment cost.
Additional or withdrawing investment would affect the cost of long-term equity investment.
Investment income is recognized in the period in accordance with the attributable share of cash
dividends or profit distributions declared by the investee.
16.3.2 A long-term equity investment accounted for using the equity method
Except associate and joint venture investment completely or partly classified as available for sale,
and The Group accounts for investment in associates and joint ventures using the equity method.
An associate is an entity over which the Group has significant influence and a joint venture is a
joint arrangement whereby the parties that have joint control of the arrangement have ri ghts to the
net assets of the joint arrangement.
Under the equity method, where the initial investment cost of a long-term equity investment
exceeds the Group's share of the fair value of the investee's identifiable net assets at the time of
acquisition, no adjustment is made to the initial investment cost. Where the initial investment cost
is less than the Group's share of the fair value of the investee's identifiable net assets at the time of
acquisition, the difference is recognized in profit or loss for the period, and the cost of the long-
term equity investment is adjusted accordingly.
- 37 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
16. Long-term equity investments - continued
16.3 Subsequent measurement and recognition of profit or loss - continued
16.3.2 A long-term equity investment accounted for using the equity method - continued
Under the equity method, the Group recognizes its share of the other comprehensive income and
net profit or loss of the investee for the period as other comprehensive income and investment
income or loss respectively for the period, and the carrying amount of the long-term equity
investment is adjusted accordingly. The carrying amount of the investment shall be reduced by t he
portion of any profit distributions or cash dividends declared by the investee that is distributed to
the investing enterprise. The investing enterprise shall adjust the carrying amount of the long-term
equity investment for other changes in owners' equity of the investee (other than net profits or
losses, other comprehensive income and profit distribution), and include the corresponding
adjustment in capital reserve. The Group recognizes its share of the investee's net profit or loss
based on the fair value of the investee's individually identifiable assets at the acquisition date after
making appropriate adjustments. Where the accounting policies and accounting period adopted by
the investee are different from those of the investing enterprise, the investing enterprise shall
adjust the financial statements of the investee to conform to its own accounting policies and
accounting period, and recognize other comprehensive income and investment income or losses
based on the adjusted financial statements. Unrealized profits or losses resulting from the Group's
transactions and assets invested or sold that are not recognized as business transactions with its
associates and joint ventures are recognized as investment income or loss to the extent that those
attributable to the Group's, equity interest are eliminated. However, unrealized losses resulting
from the Group's transactions with its associates and joint ventures which represent impairment
losses on the transferred assets are not eliminated.
The Group discontinues recognizing its share of net losses of the investee after the carrying
amount of the long-term equity investment together with any long-term interests that in substance
form part of its net investment in the investee are reduced to zero. Excep t that if the Group has
incurred obligations to assume additional losses, a provision is recognized according to the
obligation expected, and recorded in the investment loss for the period. Where net profits are
subsequently made by the investee, the Group resumes recognizing its share of those profits only
after its share of the profits exceeds the share of losses previously not recognized.
16.4 Disposal of long-term equity investments
On disposal of a long-term equity investment, the difference between the proceeds actually
received and receivable and the carrying amount is recognized in profit or loss for the period. For
long-term equity investments accounted for using the equity method, if the remaining interest
after disposal is still accounted for using the equity method, other comprehensive income
previously recognized for using the equity method is accounted for on the same basis as would
have been required if the investee had directly disposed of related assets or liabilities, and
transferred to profit or loss for the period on a pro rata basis; owners' equity recognized due to
changes in other owners' equity of the investee (other than net profit or loss, other comprehensive
income and profit distribution) is transferred to profit or loss for the period on a pro rata basis.
- 38 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
16. Long-term equity investments - continued
16.4 Disposal of long-term equity investments - continued
For long-term equity investments accounted for using the cost method, if the remaining interest
after disposal is still accounted for using the cost method, other comprehensive income previously
recognized for using the equity method or in accordance with the standards for the recognition
and measurement of financial instruments before obtaining the control over the investee, is
accounted for on the same basis as would have been required if the investee had directly disposed
of related assets or liabilities, and transferred to profit or loss for the period on a pro rata basis;
changes in other owners' equity in the investee's net assets recognized under the equity method
(other than net profit or loss, other comprehensive income and profit distribution) is transferred to
profit or loss for the period on a pro rata basis.
17. Investment properties
Investment property is property held to earn rentals or for capital appreciation or both. It includes
a land use right that is leased out; a land use right held for transfer upon capital appreciation; and
a building that is leased out.
An investment property is measured initially at cost. Subsequent expenditures incurred for such
investment property are included in the cost of the investment property if it is probable that
economic benefits associated with an investment property will flow to the Group and the
subsequent expenditures can be measured reliably, other subsequent expenditures are recognized
in profit or loss in the period in which they are incurred.
The Group uses the cost model for subsequent measurement of investment property, and adopts a
depreciation or amortization policy for the investment property which is consistent with that for
buildings or land use rights.
An investment property is derecognized upon disposal or when the investment property is
permanently withdraw from use and no future economic benefits are expected from the disposal.
When an investment property is sold, transferred, retired or damaged, the Group recognizes the
amount of any proceeds on disposal net of the carrying amount and related taxes in profit or loss
for the period.
18. Fixed assets
18.1 Recognition criteria for fixed assets
Fixed assets are tangible assets that are held for use in the production or supply of goods or
services, for rental to others, or for administrative purposes, and have useful lives of more than
one accounting year. A fixed asset is recognized only when it is probable that economic benefits
associated with the asset will flow to the Group and the cost of the asset can be measured reliably.
Fixed assets are initially measured at cost. Upon being restructured into a stock company, the
fixed assets initially contributed by the state-owned shareholders are recognized based on the
valuation amounts confirmed by the state-owned assets administration department.
- 39 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
18. Fixed assets - continued
18.1 Recognition criteria for fixed assets - continued
Subsequent expenditures incurred for the fixed asset are included in the cost of the fixed asset and
if it is probable that economic benefits associated with the asset will flow to the Group and the
subsequent expenditures can be measured reliably. Meanwhile the carrying amount of the
replaced part is derecognized. Other subsequent expenditures are recognized in profit or loss in
the period in which they are incurred.
18.2 Depreciation of each category of fixed assets
A fixed asset is depreciated over its useful life using the straight-line method starting from the
month subsequent to the one in which it is ready for intended use. The useful life, estimated net
residual value rate and annual depreciation rate of each category of fixed assets are as follows:
Estimated Annual
Category Useful lives
residual value (%) depreciation rate (%)
Port and terminal facilities 5-50 years 5.00 1.90-19.00
Buildings 10-30 years 5.00 3.17-9.50
Machinery and equipment, furniture
3-20 years 5.00 4.75-31.67
and fixture and other equipment
Motor vehicles and cargo ships 5-25 years 5.00 3.80-19.00
Estimated net residual value of a fixed asset is the estimated amount that the Group would
currently obtain from disposal of the asset, after deducting the estimated costs of disposal, if the
asset were already of the age and in the condition expected at the end of its useful life.
18.3 Other explanations
If a fixed asset is upon disposal or no future economic benefits are expected to be generated from
its use or disposal, the fixed asset is derecognized. When a fixed asset is sold, transferred, retired
or damaged, the amount of any proceeds on disposal of the asset net of the carrying amount a nd
related taxes is recognized in profit or loss for the period.
The Group reviews the useful life and estimated net residual value of a fixed asset and the
depreciation method applied at least once at each financial year-end, and account for any change
as a change in an accounting estimate.
19. Construction in progress
Construction in progress is measured at its actual costs. The actual costs include various
construction expenditures during the construction period, borrowing costs capitalized before it is
ready for intended use and other relevant costs. Construction in progress is not depreciated.
Construction in progress is transferred to a fixed asset when it is ready for intended use.
- 40 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
20. Borrowing Costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying
asset are capitalized when expenditures for such asset and borrowing costs are incurred and
activities relating to the acquisition, construction or production of the asset that are necessary to
prepare the asset for its intended use or sale have commenced. Capitalization of borrowing costs
ceases when the qualifying asset being acquired, constructed or produced becomes ready for its
intended use or sale. Capitalization of borrowing costs is suspended during periods in which the
acquisition, construction or production of a qualifying asset is interrupted abnormally and when
the interruption is for a continuous period of more than 3 months. Capitalization is suspended
until the acquisition, construction or production of the asset is resumed. Other borrowing costs are
recognized as an expense in the period in which they are incurred.
Where funds are borrowed under a specific-purpose borrowing, the amount of interest to be
capitalized is the actual interest expense incurred on that borrowing for the period less any bank
interest earned from depositing the borrowed funds before being used on the asset or any
investment income on the temporary investment of those funds. Where funds are borrowed under
general-purpose borrowings, the Group determines the amount of interest to be capitalized on
such borrowings by applying a capitalization rate to the weighted average of the excess of
cumulative expenditures on the asset over the amounts of specific-purpose borrowings. The
capitalization rate is the weighted average of the interest rates applicable to the general -purpose
borrowings. During the capitalization period, exchange differences related to a specific-purpose
borrowing denominated in foreign currency are all capitalized. Exchange differences in
connection with general-purpose borrowings are recognized in profit or loss in the period in
which they are incurred.
21. Intangible assets
21.1 Valuation method and useful life of intangible assets
An intangible asset is measured initially at cost. Upon being restructured into a stock company,
the intangible assets initially contributed by the state-owned shareholders are recognized based on
the valuation amounts confirmed by the state-owned assets administration department. When an
intangible asset with a finite useful life is available for use, its original cost is amortized over its
estimated useful life. Intangible assets with uncertain service life will not be amortize. The
terminal operating rights are amortized using the output method, that is, amortized through
periods according to the ratio of the estimated minimum guaranteed throughput to the estimated
minimum guaranteed total throughput during the operation period. When the estimated minimum
guaranteed throughput cannot be measured reliably, the straight-line method will be used for
amortization. An intangible asset with uncertain useful life will not be amortized. The
amortization method, useful life and estimated net residual value of various intangible assets are
as follows:
Category Amortization Method Useful Life (year) Residual value (%)
Land use rights Straight-line method 40-50 -
Port operating right Output method/Straight-line method 30-35 -
Others Straight-line method 5-50 -
- 41 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
For an intangible asset with a finite useful life, the Group reviews the useful life and amortization
method at the end of the year, and makes adjustments when necessary.
- 42 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
21. Intangible assets - continued
21.2 Research and development expenditure
Expenditure during the research phase is recognized as an expense in the period in which it is
incurred.
Expenditure during the development phase that meets all of the following conditions at the same
time is recognized as intangible asset. Expenditure during development phase that does not meet
the following conditions is recognized in profit or loss for the period.
(1) It is technically feasible to complete the intangible asset so that it will be available for use or
sale;
(2) The Group has the intention to complete the intangible asset and use or sell it;
(3) The Group can demonstrate the ways in which the intangible asset will generate economic
benefits, including the evidence of the existence of a market for the output of the intangible
asset or the intangible asset itself or, if it is to be used internally, the usefulness of the
intangible asset;
(4) The availability of adequate technical, financial and other resources to complete the
development and the ability to use or sell the intangible asset; and
(5) The expenditure attributable to the intangible asset during its development phase can be
reliably measured.
If the expenditures cannot be distinguished between the research phase and development phase,
the Group recognizes all of them in profit or loss for the period. The costs of intangible assets
generated by the internal research only include the total expenditure incurred for the period from
the time point of capitalization to the intangible assets are ready for intended use. For the identical
intangible asset, the expenditures recorded as expenses before they qualify for capitalization
during the development process are not adjusted.
22. Impairme nt of long-term assets
The Group assesses at the balance sheet date whether there is any indication that the long-term
equity investments, investment properties measured at cost method, construction in progress,
fixed assets, right-of-use assets and intangible assets with a finite useful life may be impaired. If
there is any indication that such assets may be impaired, recoverable amounts are estimated for
such assets. Intangible assets with indefinite useful life and intangible assets not yet available for
use are tested for impairment annually, irrespective of whether there is any indication that the
assets may be impaired.
Recoverable amount is estimated on individual basis. If it is not practical to estimate the
recoverable amount of an individual asset, the recoverable amount of the asset group to which the
asset belongs will be estimated. The recoverable amount of an asset is the higher of its fair value
less costs of disposal and the present value of the future cash flows expected to be derived from
the asset.
- 43 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
22. Impairme nt of long-term assets - continued
If the recoverable amount of an asset or an asset group is less than its carrying amount, the deficit
is accounted for as an impairment loss and is recognized in profit or loss.
Goodwill is tested for impairment at least at the end of each year. For the purpose of impairme nt
testing, goodwill is considered together with the related assets groups, i.e., goodwill is reasonably
allocated to the related assets groups or each of assets groups expected to benefit from the
synergies of the combination. In testing an assets group with goodwill for impairment, an
impairment loss is recognized if the recoverable amount of the assets group or sets of assets
groups (including goodwill) is less than its carrying amount. The impairment loss is firstly
allocated to reduce the carrying amount of any goodwill allocated to such assets group or sets of
assets groups, and then to the other assets of the group pro-rata basis on the basis of the carrying
amount of each asset (other than goodwill) in the group.
Once the impairment loss of above-mentioned asset is recognized, it shall not be reversed in any
subsequent period.
23. Long-term prepaid expenses
Long-term prepaid expenses represent expenses incurred that should be borne and amortized over
the current and subsequent periods (together of more than one year). Long-term prepaid expenses
are amortized using the straight-line method over the expected periods in which benefits are
derived.
24. Contract liabilities
A contract liability represents the Group's obligation to transfer goods or services to a customer
for which the Group has received consideration (or an amount of consideration is due) from the
customer. A contract asset and a contract liability relating to the same contract are accounted for
and presented on a net basis.
25. Employee benefits
25.1 The accounting treatment of short-term employee benefits
Actually occurred short-term employee benefits are recognized as liabilities, with a corresponding
charge to the profit or loss for the period or in the costs of relevant assets in the accounting period
in which employees provide services to the Group. Staff welfare expenses incurred by the Group
are recognized in profit or loss for the period or the costs of relevant assets based on the actually
occurred amounts when it actually occurred. Non-monetary staff welfare expenses are measured
at fair value.
- 44 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
25. Employee benefits - continued
25.1 The accounting treatment of short-term employee benefits - continued
Payment made by the Group of social security contributions for employees such as premiums or
contributions on medical insurance, work injury insurance and maternity insurance, etc. and
payments of housing funds, as well as union running costs and employee education costs provided
in accordance with relevant requirements, are calculated according to prescribed bases and
percentages in determining the amount of employee benefits and recognized as relevant liabilities,
with a corresponding charge to the profit or loss for the period or the costs of relevant assets in the
accounting period in which employees provide services.
25.2 The accounting treatment of post-employment benefits
Post-employment benefits are classified into defined contribution plans and defined benefit plans.
During the accounting period of rendering service to employees of the Group, amount which
should be paid according to defined contribution plans is recognized as liabilities, and recognized
in profit or loss or related costs of assets.
During the accounting period of rendering service to employees of the Group, amount which
should be paid according to defined contribution plans is recognized as liabilities, and recognized
in profit or loss or related costs of assets.
For defined benefit plans, the Group calculates defined benefit plan obligations using projected
unit credit method and the service cost resulting from employee service in the current period is
recorded in profit or loss or the cost of related assets. Defined benefit costs are categorized as
follows:
Service cost (including current service cost, past service cost, as well as gains and losses on
settlements);
Net interest of net liabilities or assets of defined benefit plan (including interest income of
planned assets, interest expenses of defined benefit plan liabilities and effect of asset ceiling);
and
Changes arising from remeasurement of net liabilities or net assets of defined benefit plans.
Service costs and net interest of net liabilities and net assets of defined benefit plans are
recognized in profit or loss of current period or costs of related assets. Remeasurement of the net
defined benefit liability (asset) (including actuarial gains and losses, the return on plan assets,
excluding amounts included in net interest on the net defined benefit liability (asset), and any
change in the effect of the asset ceiling, excluding amounts included in net interest on the net
defined benefit liability (asset)) are recognized in other comprehensive income.
- 45 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
25. Employee benefits - continued
25.3 The accounting treatment of termination benefits
When the Group provides termination benefits to employees, employee benefit liabilities are
recognized for termination benefits, with a corresponding charge to the profit or loss for the
period at the earlier of: (1) when the Group cannot unilaterally withdraw the offer of termination
benefits because of the termination plan or a curtailment proposal; and (2) when the Group
recognizes costs or expenses related to restructuring that involves the payment of termination
benefits.
26. Provisions
Provisions are recognized when the Group has a present obligation related with contingencies, it
is probable that the Group will be required to settle that obligation causing an outflow of
economic benefits, and a reliable estimate can be made of the amount of the obligation.
The amount recognized as a provision is the best estimate of the consideration required to settle
the present obligation at balance sheet date, taking into account the risks, uncertainties and time
value of money surrounding the obligation. When a provision is measured using the cash flows
estimated to settle the present obligation, its carrying amount is the present value of those cash
flows where the effect of the time value of money is material.
When some or all of the economic benefits required to settle a provision are expected to be
recovered from a third party, a receivable is recognized as an asset if it is virtually certain that
reimbursement will be received and the amount of the receivable should not exceed the carrying
amount of provisions.
27. Revenue
The Group's revenue is mainly from the following business types:
(1) Port service;
(2) Bonded logistics service
(3) Other business such as property development and investment.
The Group recognizes revenue based on the transaction price allocated to such performance
obligation when a performance obligation is satisfied, i.e. when "control" of the goods or services
underlying the particular performance obligation is transferred to the customer. A performance
obligation represents the commitment that a good and service that is distinct shal l be transferred
by the Group to the customer. Transaction price refers to the consideration that the Group is
expected to charge due to the transfer of goods or services to the customer, but it does not include
payments received on behalf of third parties and amounts that the Group expects to return to the
customer.
- 46 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
27. Revenue - continued
If one of the following criteria is met and it is a performance obligation performed over time, the
Group recognizes the revenue within a certain period of time according to the progress of the
performance: (1) the customer simultaneously receives and consumes the benefits provided by the
Group's performance as the Group performs ; (2) the customer is able to control the goods under
construction in the course of the Group's performance; (3) the goods produced by the Group
during the performance of the contract are irreplaceable and the Group has the right to charge for
the accumulated part of the contract that has been performed so far during the whole contract
period. Otherwise, the Group recognizes revenue at a certain point in time when "control" of the
goods or services is transferred to the customer.
The Group adopts output method, i.e. the value of goods or services transferred to customers to
determine the appropriate progress of performance. Where the progress cannot be determined
reasonably, the revenue is recognized based on the amount of cost that is expected to be
compensated based on the cost already incurred, until the progress of performance is reasonably
determined.
If the contract includes two or more performance obligations, at contract inception, the Group
allocates the transaction price to single performance obli gation according to relative proportion of
the stand-alone selling prices of the goods or services promised by single performance obligation.
However, where there is conclusive evidence that the contract discount or variable consideration
is only related to one or more (not all) performance obligations in the contract, the Group shall
allocate the contract discount or variable consideration to relevant one or more performance
obligations. The stand-alone selling price is the price at which the Group would sell a promised
good or service separately to a customer. If a stand-alone selling price is not directly observable,
the Group shall consider all information that is reasonably available to the Group and maximize
the use of observable inputs and apply estimates methods consistently in similar circumstances.
For contracts that contain variable consideration (e.g. sales discount), the Group estimates the
amount of consideration using either the expected value or the most likely amount. The
transaction price that includes variable consideration is only to the extent that it is highly probable
that such an inclusion will not result in a significant revenue reversal in the future when the
uncertainty is subsequently resolved. At the end of each reporting period, the Group reevaluates
the variable consideration included in the transaction price.
For non-cash consideration from customer, the Group recognizes the transaction price based on
the fair value of the non-cash consideration. Where the fair value of the non-cash consideration
cannot be reasonably estimated, the Group recognizes the transaction price indirectly by reference
to the stand-alone price of the promised goods or services promised transferred to the customer.
- 47 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
27. Revenue - continued
If the contract includes significant financing component, the Group determines the transaction
price based on the amount payable under the assumption that the customer pays tha t amount
payable in cash when "control" of the goods or services is obtained by the customer. The
difference between the transaction price and the contract consideration shall be amortized within
the contract period using effective interest rate. If the Group expects, at contract inception, that the
period between when the Group transfers a promised good or service to a customer and when the
customer pays for that good or service will be one year or less, the Group needs not to consider
the significant financing component.
The Group determines whether it is a principal or an agent at the time of the transaction based on
whether it owns the "control" of the goods or services before the transfer of such goods or
services to the customer. The Group is a principal if it controls the specified good or service
before that good or service is transferred to a customer, and the revenue shall be recognized based
on the total consideration received or receivable; otherwise, the Group is an agent, and the
revenue shall be recognized based on the amount of commission or handling fee that is expected
to be charged, and such amount is determined based on the net amount of the total consideration
received or receivable after deducting the prices payable to other related parties or according to
the established commission amount or proportion.
Where payment is received in advance, the advance payment received shall be recorded as a
liability and recognized as revenue when the relevant performance obligation is satisfied. The
above amount will be recognized as revenue proportionately in accordance with the model of
contractual rights exercised by the customer if (1) the Group's advance payment does not need to
be returned, (2) the customer may waive all or part of its contractual rights, and (3) the Group
expects to be entitled to the amount related to the contractual rights waived by the customer.
Otherwise, the balance of the liabilities is recognized as revenue by the Group only when the
possibility of the customer requesting the satisfaction of the remaining performance obligations is
extremely remote.
28. Contract costs
28.1 Costs to fulfill a contract
If the costs incurred in fulfilling a contract are not within the scope of other standard other than
the revenue standard, the Group shall recognized an asset from the costs incurred to fulfill a
contract only if those costs meet all of the following criteria: (1) the costs relate directly to a
contract or to an anticipated contract that the Group can specifically identify; ( 2) the costs
generate or enhance resources of the entity that will be used in satisfying performance obligations
in the future; and (3) the costs are expected to be recovered. The asset mentioned above shall be
amortized on a basis that is consistent with the transfer to the customer of the goods or services to
which the asset relates and recognized in profit or loss for the period.
- 48 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
28. Contract costs - continued
28.2 Impairment of contract costs
In determination of impairment losses of assets related to contract costs, firstly impairment losses
of other assets related to the contract recognized based on other relevant accounting standards;
secondly, the Group shall recognized an impairment loss to the extent that the carrying amount of
an asset exceeds: (1) the remaining amount of consideration that the Group expects to receive in
exchange for the goods or services to which the asset relates; (2) the estimated costs that relate to
providing those goods or services.
The Group shall, after the impairment has been provided, recognized in profit or loss a reversal of
some or all of an impairment loss previously recognized when the impairment conditions no
longer exist or have improved. The increased carrying amount of the asset shall not exceed the
carrying amount that would have been determined if no impairment loss had been recognized
previously.
29. Types and accounting methods of governme nt grants
Government grants are transfer of monetary assets or non-monetary assets from the government to
the Group at no consideration. A government grant is recognized only when the Group can
comply with the conditions attached to the grant and the Group will receive 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.
29.1 The accounting treatment of government grants related to assets
Government grants, such as special funds for modern logistics project and special funds for
energy-saving and emission reduction of transportation, are government grants related to assets as
they are all related to the construction and use of assets.
A government grant related to an asset is recognized as deferred income, and evenly amortized to
profit or loss over the useful life of the related asset.
29.2 The accounting treatment of government grants related to income
The Group's government grant, such as financial support funds of business tax converted to VAT
and reward for energy saving, if used to compensate the related expenses or losses to be incurred
in subsequent periods, is determined to be government grant relating to income.
A government grant relating to income, if used to compensate the related cost, expenses or losses
to be incurred in subsequent periods, is determined as deferred income and recognized in profit or
loss over the periods in which the related costs are recognized; if used to compensate the related
cost, expenses or losses already incurred, is recognized immediately in profit or loss for the period.
- 49 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
A government grant relating to the Group's daily activities, is recognized in other income in line
with the nature of economic transaction. A government grant not relating to the Group's daily
activities, is recognized in non-operating income.
- 50 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
30. Deferred tax assets/ deferred tax liabilities
The income tax expenses include current income tax and deferred income tax.
30.1 Current income tax
At the balance sheet date, current income tax liabilities (or assets) for the current and prior periods
are measured at the amount expected to be paid (or recovered) according to the requirements of
tax laws.
30.2 Deferred tax assets and deferred tax liabilities
For temporary differences between the carrying amounts of certain assets or liabilities and their
tax base, or between the nil carrying amount of those items that are not recognized as assets or
liabilities and their tax base that can be determined according to tax laws, deferred tax assets and
liabilities are recognized using the balance sheet liability method.
Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred
tax assets for deductible temporary differences are recognized to the extent that it is probable that
taxable profits will be available against which the deductible temporary differences can be utilized.
However, for temporary differences associated with the initial recognition of goodwill and the
initial recognition of an asset or liability arising from a transaction (not a business combination)
that affects neither the accounting profit nor taxable profits (or deductible losses) at the time of
transaction, no deferred tax asset or liability is recognized.
For deductible losses and tax credits that can be carried forward, deferred tax assets are
recognized to the extent that it is probable that future taxable profits will be available against
which the deductible losses and tax credits can be utilized.
Deferred tax liabilities are recognized for taxable temporary differences associated with
investments in subsidiaries and associates, and interests in joint ventures, except where the Group
is able to control the timing of the reversal of the temporary difference and it is probable that the
temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from
deductible temporary differences associated with such investments and interests are only
recognized to the extent that it is probable that there will be taxable profits against which to utilize
the benefits of the temporary differences and they are expected to reverse in the foreseeable future.
At the balance sheet date, deferred tax assets and liabilities are measured at the tax rates
applicable in the period in which the asset is realized or the liability is settled according to tax
laws.
Current and deferred tax expenses or income are recognized in profit or loss for the period, except
when they arise from transactions or events that are directly recognized in other comprehensive
income or in equity, in which case they are recognized in other comprehensive income or in
equity, and when they arise from business combinations, in which case they adjust the carrying
amount of goodwill.
- 51 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
- 52 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
30. Deferred tax assets/ deferred tax liabilities - continued
30.2 Deferred tax assets and deferred tax liabilities - continued
At the balance sheet date, the carrying amount of deferred tax assets is reviewed and reduced if it
is no longer probable that sufficient taxable profits will be available in the future to allow the
benefit of deferred tax assets to be utilized. Any such reduction in amount is reversed when it
becomes probable that sufficient taxable profits will be available.
30.3 Offset of income tax
When the Group has a legal right to settle on a net basis and intends either to settle on a net basis
or to realize the assets and settle the liabilities simultaneously, current tax assets and current tax
liabilities are offset and presented on a net basis.
When the Group has a legal right to settle current tax assets and liabilities on a net basis, and
deferred tax assets and deferred tax liabilities relate to income taxes levied by the same taxation
authority on either the same taxable entity or different taxable entities which intend either to settle
current tax assets and liabilities on a net basis or to realize the assets and liabilities simultaneously,
in each future period in which significant amounts of deferred tax assets or liabilities are expected
to be reversed, deferred tax assets and deferred tax liabilities are offset and presented on a net
basis.
31. Leases
Lease is a contract that conveys the right to use an asset for a period of time in exchange for
consideration.
For contracts that are signed or modified after the date of initial application, at
inception/modification of the contracts, the Group assesses whether the contract is, or contains, a
lease. Unless the terms and conditions of the contract are changed, the Group does not reassess
whether a contract is, or contains, a lease.
31.1 The Group as Lessee
31.1.1 Separating components of a lease
If a contract contains a lease component and one or more non-lease components, the Group
allocates the consideration in the contract to each lease component on the basis of the relative
stand-alone price of the lease components and the aggregate stand-alone price of the non-lease
components.
- 53 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
31. Leases - continued
31.1 The Group as Lessee - continued
31.1.2 Right-of-use assets
Except for short-term leases and leases for which the underlying asset is of low value, at the
commencement date of the lease, the Group recognizes a right-of-use assets. The commencement
date of the lease is the date on which a lessor makes an underlying asset available for use by the
Group. The Group measures the right-of-use assets at cost. The cost of the right-of-use assets
comprises:
the amount of the initial measurement of the lease liabilities;
any lease payments made at or before the commencement date, less any lease incentives;
any initial direct costs incurred by the Group;
an estimate of costs to be incurred by the lessee in dismantling and removing the underlying
asset, restoring the site on which it is located or restoring the underlying asset to the
condition required by the terms and conditions of the lease.
Right-of-use assets are depreciated by the Group in accordance with the ASBE No.4 Fixed Assets.
If the Group is reasonably certain, that the lease will transfer ownership of the underlying asset to
the Group by the end of the lease term, the right-of-use assets is depreciated from the
commencement date to the end of the useful life of the underlying asset. Otherwise, the right-of-
use assets is depreciated from the commencement date to the earlier of the end of the useful life of
the right-of-use assets or the end of the lease term.
The Group applies ASBE No. 8 Impairment of Assets, to determine whether the right-of-use
assets are impaired and to account for any impairment loss identified.
31.1.3 Lease liabilities
Except for short-term leases and leases for which the underlying asset is of low value, at the
commencement date of the lease, the Group measures the lease liabilities at the present value of
the lease payments that are not paid at that date. If the interest rate implicit in the lease cannot be
readily determined, the lessee shall use the lessee's incremental borrowing rate.
- 54 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
31. Leases - continued
31.1 The Group as Lessee - continued
31.1.3 Lease liabilities - continued
The lease payments comprise the following payments by the Group for the right to use the
underlying asset during the lease term:
fixed payments (including in-substance fixed payments), less any lease incentives;
variable lease payments that depend on an index or a rate;
the exercise price of a purchase option if the Group is reasonably certain to exercise that
option;
payments for terminating the lease, if the lease term reflects the Group exercising an
option to terminate the lease;
amounts expected to be payable by the Group under residual value guarantees.
Variable lease payments that depend on an index or a rate, are initially measured using the index
or rate as at the commencement date. Variable lease payments not included in the measurement of
the lease liabilities, are recognized in profit or loss, or in the cost of relevant assets, in the period
of those payments.
Interest on the lease liabilities in each period during the lease term is calculated by a constant
periodic rate of interest on the remaining balance of the lease liabilities.
After the commencement date, if one of the following occurs, the lease liability is remeasured by
the Group with the adjustment to the right-of-use asset. If the carrying amount of the right-of-use
asset is reduced to zero and there is further reduction in the measurement of the lease liability, the
remaining remeasurement should be recognized in profit or loss.
there is a change in the lease term, or in the assessment of an option to purchase the
underlying asset, the Group remeasures the lease liabilities, on the basis of the revised lease
term and the revised discount rate;
there is a change in the amounts expected to be payable under a residual value guarantee, or
in future lease payments resulting from a change in an index or a rate used to determine
those payments, the Group remeasures the lease liabilities, on the basis of the revis ed lease
payments and the unchanged discount rate, unless the change in the lease payments results
from a change in floating interest rates, in which case a revised discount is applied to the
present value.
- 55 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
31. Leases - continued
31.1 The Group as Lessee - continued
31.1.4 Short-term leases and leases for which the underlying asset is of low value
The Group elects not to recognize right-of-use assets or lease liabilities for short-term leases and
leases for which the underlying asset is of low value, i.e. port and terminal facilities, buildings,
machinery and equipment, furniture and fixture and other equipment, motor vehicles and cargo
ships, other short-term leases and leases for which the underlying asset is of low value. A shorts-
term lease is a lease that, at the commencement date, has a lease term of 12 months or less. A
lease for which the underlying asset is of low value is that, the value of the underlying asset is low
when it is new. For short-term leases and leases for which the underlying asset is of low value, the
Group recognizes the lease payments associated with those leases as an expense or cost of
relevant asset on a straight-line basis over the lease term.
31.1.5 Lease modifications
A lease modification should be accounted for as a separate lease if both of the following apply:
the modification increases the scope of the lease by adding the right to use one or more
underlying assets; and
the consideration for the lease increases by an amount commensurate with the stand-alone
price for the increase in scope and any appropriate adjustments to that stand-alone price
according to the circumstances of the particular contract
For a lease medication that is not accounted for as a separate lease, at the effective date of the
lease modification, the Group should allocate the consideration in the modified contract,
determine the lease term of the modified lease and remeasure the lease liability by discounting the
revised payments using a revised discount rate.
For lease modifications that decrease the scope of the lease or narrow the term of the lease, the
Group should decrease the carrying amount of the right-of-use asset with any gain or loss relating
to the partial or full termination of the lease should be recognized in profit or loss. For
remeasurement of lease liabilities from all other lease modifications, a corresponding adjustment
is made to the carrying amount of the right-of-use asset.
31.2 The Group as Lessor
31.2.1 Separating components of a lease
For a contract that contains lease and non-lease components, the Group shall allocate the
consideration in the contract in accordance with the allocation of the transaction price under the
revenue standard, on the basis of the relative stand-alone price of the lease components and the
aggregate stand-alone price of the non-lease components.
- 56 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
31. Leases - continued
31.2 The Group as Lessor - continued
31.2.2 Classification of leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the
risks and rewards of ownership. All other leases are classified as operating leases.
31.2.2.1 The Group as lessor under operating leases
The Group recognizes lease payments from operating leases as income on a straight-line basis.
The Group capitalizes initial direct costs incurred in obtaining an operating lease and r ecognizes
those costs as an expense over the lease term on the same basis as the lease income.
Variable lease receipts relating to an operating lease not included in the lease receipts are
recognized in profit or loss by the Group when incurred.
31.2.2.2 The Group as lessor under finance leases
At the commencement date, the Group recognizes a finance lease receivable at the amount equal
to the net investment in the lease with finance lease assets derecognized. The net investment in the
lease is the sum of any unguaranteed residual value and lease payments receivable from the
commencement date, discounted at the interest rate implicit in the lease.
The amount of the lease payments receivable refers to the amount that the Group should collect
from the lessee for the purpose of transferring the leased assets during the lease term, including:
fixed payments (including in-substance fixed payments) paid by the lessee, less any lease
incentives;
variable lease payments that depend on an index or a rate;
the exercise price of a purchase option, provided that it is reasonably determined that the
lessee will exercise the option;
the lessee exercises the amount to be paid for the termination of the lease option, provided
that the lease term reflects the lessee's exercise of the option to terminate the lease;
the residual value of the guarantee provided by the lessee, the party concerned with the
lessee and the independent third party with the financial ability to perform the guarantee
obligation.
Variable payments receivable not included in the net investment in the lease are recognized in
profit or loss when they arise.
Interest income for each period over the lease term is recognized by the Group at the fixed
periodic rate.
- 57 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
31. Leases - continued
31.2 The Group as Lessor - continued
31.2.3 Subleases
As a lessor of the sublease, the Group accounts for the original lease contract and the sublease
contract as two separate contracts. The Group classifies the subleases based on the right-of-use
assets generating from the original lease rather than the underlying assets of the original lease.
31.2.4 Lease modifications
The Group accounts for a modification to an operating lease as a new lease from the effective date
of the modification, considering any lease advances or receivables relating to the original lease as
the lease receipts for the new lease.
The Group should account for a modification to a finance lease as a separate lease if both:
the modification increases the scope of the lease by adding the right to use one or more
underlying assets; and
The consideration for the lease increases by an amount commensurate with the stand-alone
price for the increase in scope with any appropriate adjustment to that stand-alone price.
For a modification to a finance lease that is not accounted for as a separate lease, the Group
should account for the modification as follows:
if the lease would have been classified as an operating lease had the modification been effect
at the inception date, the Group should account for the lease modification as a new lease
from the effective date of the modification, and measure the carrying amount of the
underlying asset as the net investment in the lease before the effective date of the lease
modification.
If the lease would have been classified as an operating lease if the modification had been in
effect at the inception date, the Group should apply the requirements of contract
modification and renegotiation under the ASBE No. 22 Financial Instruments: Recognition
and Measurement.
31.2.5 Sale and leaseback transactions
31.2.5.1 The Group as the seller-lessee
The Group applies the requirements of the revenue standard to determine whether the transfer of
an asset is accounted for as a sale of that asset. If the transfer of an asset does not constitute a sale,
the Group should continue to recognize the transferred assets and should recognize a financial
liability equal to the transfer proceeds applying ASBE No. 22 Financial Instruments: Recognition
and Measurement. If the transfer of an asset is a sale, the Group should measure the right-of-use
asset arising from the leaseback at the proportion of the previous carrying amount of the asset that
relates to the right of use, and recognize only the amount of any gain or loss that relates to the
rights transferred to the lessor.
- 58 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
- 59 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
32. Exchange of Non-Monetary Assets
Where a non-monetary assets transaction satisfies the following conditions at the same time, it
should calculated based on fair value. The transaction is commercial in nature and the fair value
of the assets received or surrendered can be measured reliably. The fair value of the assets
surrendered and relevant payable taxes shall be regarded as the transaction cost of the assets
received. For assets surrendered, the difference between the fair value and the carrying value of
the asset surrendered shall be recorded into the profit or loss of the current period. If a ny exact
evidence showing that the fair value of the assets received is more reliable, the cost of assets
received and surrendered shall be calculated as different way. For assets received, its cost shall be
calculated based on fair value of assets received and relevant payable taxes. For the assets
surrendered, the difference between the fair value of the assets received and the carrying value of
the asset surrendered shall be recorded into the profit or loss of the current period.
Where a non-monetary assets transaction does not meet the conditions as prescribed, the carrying
value and relevant payable taxes of the assets surrendered shall be the cost of the assets received
and no profit or loss is recognized.
33. Discontinued Operation
Discontinued operation refers to the separately identifiable components that have been disposed
of or classified as held for sale and meet one of the following conditions:
(1) The component represents an independent main business or a major business area;
(2) This component is a part of a related plan that intends to dispose an independent main
business or a separate main operating area;
(3) This component is a subsidiary acquired exclusively for resale.
Profits or losses from discontinued operations are presented separately in the income statement
from continuing operations. Profits and losses from operations or disposals (e.g. impairment
losses and reversals of discontinued operations) are presented under discontinued operations. For
discontinued operations presented in the current period, the information previously under
continuing operations is presented under discontinued operations by the Group in the financial
statements for the comparable accounting period.
34. Safety Production Cost
According to the Administrative Rules on Provision and Use of Enterprise Safety Production Cost
jointly issued by the Ministry of Finance and the State Administration of Work Safety on 14
February 2012 (filed as Cai Qi [2012] No. 16), safety production cost set aside by the Group is
directly included in the cost of relevant products or recognized in profit or loss for the period, as
well as the special reserve. When safety production cost set aside is utilized, if the costs incurred
can be categorized as expenditure, the costs incurred should be charged against the special reserve.
If the costs set aside are used to build up fixed assets, the costs should be charged to construction
in progress, and reclassified to fixed assets when the safety projects are ready for intended use.
Meantime, expenditures in building up fixed assets are directly charged against the special reserve
with the accumulated depreciation recognized at the same amount. Depreciation will not be made
in the future period on such fixed assets.
- 60 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
35. Critical judgme nts in applying accounting policies and key assumptions and
uncertainties in accounting estimates
In the application of accounting policies as set out in Note (III), the Company is required to make
judgments, estimates and assumptions about the carrying amounts of items in the financial
statements that cannot be measured accurately, due to the internal uncertainty of the operating
activities. These judgments, estimates and assumptions are based on historical experiences of the
Company's management as well as other factors that are considered to be relevant. Actual results
may differ from these estimates.
The Company regularly reviews the judgments, estimates and assumptions on a going concern
basis. Changes in accounting estimates which only affect the current period should be recognized
in current period; changes which not only affect the current but the future periods should be
recognized in current and future periods. At the balance sheet date, key assumptions and
uncertainties that are likely to lead to significant adjustments to the book values of assets and
liabilities in the future are:
Goodwill impairment
For the purpose of impairment testing, the present value of the expected future cash flows of the
assets group or portfolio including goodwill shall be calculated, and such expected future cash
flows shall be estimated. Meantime, a pre-tax rate shall be determined that should reflect the time
value of money on the current market and the specific interest risks.
Recognition of deferred tax
The Group calculates and makes provision for deferred income tax liabilities according to the
profit distribution plan of subsidiaries, associates and the joint ventures subject to the related law.
For retained earnings which are not allocated by the investment company, since the profits will be
used to invest the company's daily operation and future development, no deferred income tax
liabilities are recognized. If the actually distributed profits in the future are more or less than those
expected, corresponding deferred tax liabilities will be recognized or reversed at the earlier of
profits distribution date and the declaration date, in the profit and loss of the current period.
Deferred tax assets are recognized based on the deductible temporary difference and the
corresponding tax rate, to the extent that it has become probable that future taxable profit will be
available for the deductible temporary difference. If in the future the actual taxable income does
not coincide with the amount currently expected, the deferred tax assets resulting will be
recognized or reversed in the period when actually incurred, in profit or loss.
- 61 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
36. Changes in significant accounting policies
(1) Interpretation No. 14 of Accounting Standards for Business Enterprises
On 26 January 2021, the Ministry of Finance promulgated the "Accounting Standards for
Business Enterprises Interpretation No. 14" (Cai Kuai [2021] No. 1, hereinafter referred to as
"Interpretation No. 14"). Interpretation No. 14 Question 1 "On the accounting treatment of
government-private partnership (PPP) project contracts by the private party" stipulates that the
private party providing construction services or contracting to other parties shall comply with the
"Accounting Standards for Business Enterprises No. 14 ——Accounting shall be carried out
according to the provisions of "Income". Interpretation No. 14 Question 2 "Accounting treatment
of changes in the basis for determining contractual cash flows caused by the reform of the
benchmark interest rate" stipulates that the reform of the benchmark interest rate leads to changes
in the basis for determining the contractual cash flow of financial assets or financial liabilities and
the results of the reform of the benchmark interest rate. Accounting treatment of lease changes.
Interpretation No. 14 has no significant impact on the 2021 interim financial statements of the
Group and the Company.
(2) Provisions on Accounting Treatment of Rent Concessions Related to the COVID-19
On 26 May 2021, the Ministry of Finance ("MoF") issued the Circular on Adjusting the Scope of
Application of the Provisions on Accounting Treatment of Rent Concessions Related to the
COVID-19 (Cai Kuai [2021] Document No. 9) (the "Doc. No. 9"), adjusting the scope of
application of the Provisions on Accounting Treatment of Rent Concessions Related to the
COVID-19 (Cai Kuai [2021] Document No. 10) (the "Doc. No. 10") issued by MoF on 19 June
2020. The Doc. No. 9 extended the application period of rent concession applicable to simplified
method under Doc. No.10, i.e. adjusting "Rent concession is only applicable to lease payments
payable before 30 June 2021. Any increase in lease payments payable after 30 June 2021 does not
affect the satisfaction of the criteria, but decrease in lease payments payable after 30 June 2021
does not satisfy the criteria." to "Rent concession is only applicable to lease payments payable
before 30 June 2022. Any increase in lease payments payable after 30 June 2022 does not affect
the satisfaction of the criteria, but decrease in lease payments payable after 30 June 2022 does not
satisfy the criteria.". The other criteria remain unchanged. The above provisions have no
significant impact on the Group's and Company's financial statements for the period ended 30
June 2021.
37. Changes in significant accounting estimates
The Group has no significant changes in accounting estimates in the current period.
- 62 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
IV. TAXES
1. Major taxes and tax rates
Taxes Tax basis Tax rate
Taxable income 16.5%-34% (Note 1)
Enterprise income tax
Dividend income tax 5%, 10%, 25% (Note 2)
Income from sale of goods (Note 4) 9%,13%
Income from transportation, loading and unloading business and
Value-added Tax 6%
part of modern service industries
("VAT") (Note 3)
Income from sale of real estate, property management, real estate
5%, 6%, 9%
lease, etc.
Social contribution
Income 0.65% -7.6%
tax (Note 5)
Deed tax Land use right and property transfer amount 3%-5%
Property tax 70% of cost of property or rental income 1.2% or 12%
City maintenance and
construction tax VAT paid 1%-7%
Education surtax VAT paid 3%
Note 1: The Group's enterprise income tax is calculated based on the current tax rate stipulated by
local tax laws. Among them, the Company are subject to an enterprise income tax rate of
25%, the subsidiaries set up in Hong Kong are subject to an enterprise income tax rate of
16.5%, the majority of subsidiaries set up in China are subject to an enterprise income tax
rate of 25% and certain others are subject to the preferential tax rate for small and micro
enterprises of 20%, and the other overseas subsidiaries are subject to enterprise income tax
rates between 28% and 34%.
Note 2: Foreign investors who receive dividends of profits from Chinese subsidiaries in 2008 and
thereafter generally shall pay withholding income tax at a rate of 10% in accordance with
the relevant provisions of the PRC enterprise income tax. For companies incorporated in
certain regions (including Hong Kong and Singapore), if the companies are actual owners
holding more than 25% interest in the subsidiaries in China, they will enjoy a preferential
tax rate of 5%.
The Company obtains dividends distributed by overseas subsidiaries and should pay
enterprise income tax at a rate of 25% in accordance with relevant Chinese tax laws. The
Company obtains taxable income outside of China, and the amount of income tax that has
been paid abroad can be offset with the current taxable amount. The credit limit is the
taxable amount calculated in accordance with the provisions of the Enterprise Income Tax
Law.
Note 3: The VAT amount is the balance of the output tax less the deductible input tax, and the
output tax is calculated in accordance with the sales income and the corresponding tax rate
stipulated in the relevant tax laws of China.
- 63 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
IV. TAXES - continued
1. Major taxes and tax rates - continued
Note 4: Pursuant to Announcement of Customs on Relevant Policies for Deepening the Value-
Added Tax Reform issued by the Ministry of Finance, the State Taxation Administration
and the General Administration (Announcement No. 39 [2019] of the Ministry of Finance,
the State Taxation Administration and the General Administration of Customs), from 1
April 2019, the tax rate of 16% and 10% applicable to the VAT taxable sale or import of
goods are adjusted to 13% and 9%, respectively.
Note 5: The social contribution tax is the tax paid by the overseas subsidiaries of the Group to the
local government.
2. Tax preference
Some subsidiaries of the Group in China are recognized as high-tech enterprises or
encouraged industrial enterprises in the region and are subject to an enterprise income tax
rate of 15%. The Group's subsidiaries outside China may be subject to enterprise income
tax preference in accordance with relevant local tax policies.
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS
1. Cash and bank balances
Unit: RMB
Opening balance
Item Closing balance
(Restated)
Cash 363,642.53 575,797.26
RMB 51,542.58 37,045.02
USD 150,714.70 146,078.94
HKD 24,454.21 24,653.41
BRL 6,447.44 5,997.01
Others 130,483.60 362,022.88
Bank deposit (Note 1) 9,003,695,587.20 11,547,077,133.15
RMB 6,640,184,246.92 7,585,560,643.67
USD 842,552,750.96 817,495,062.65
EUR 939,406,425.46 770,193,517.95
BRL 418,096,134.27 273,701,827.77
HKD 152,384,041.68 2,076,664,153.73
AUD 424,576.33 557,797.36
Others 10,647,411.58 22,904,130.02
Other cash and bank balances (Note 2) 375,314,367.51 370,770,828.30
RMB 375,270,597.94 370,726,535.43
HKD 43,769.57 44,292.87
Total 9,379,373,597.24 11,918,423,758.71
Including: Total amount of funds deposited overseas 2,857,588,296.09 5,313,591,920.43
Note 1:At the end of the current period, the Group's bank deposits that were deposited overseas
and restricted for capital repatriation totaled nil (at the beginning of the current period: nil).
- 64 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
1. Cash and bank balances - continued
Note 2:The structured deposits that could be readily withdrawn on demand in the other cash and
bank balances of the Group totaled RMB 362,980,035.90, the restricted deposit totaled
RMB 12,259,378.15, and the balance of the margin maintenance account was RMB
74,953.46.
2. Held-for-trading financial assets
Unit: RMB
Opening balance
Item Closing balance
(Restated)
Financial assets measured at fair value through profit or loss 1,000,173,287.80 850,165,448.59
Including: Structured deposits 1,000,000,000.00 850,000,000.00
Equity investment instruments 173,287.80 165,448.59
Total 1,000,173,287.80 850,165,448.59
3. Notes receivable
(1) Classification of notes receivable
Unit: RMB
Opening balance
Category Closing balance
(Restated)
Bank acceptance 23,664,430.98 2,245,000.16
Commercial acceptance - 3,146,994.68
Total 23,664,430.98 5,391,994.84
Less: Provision for credit losses (Note) - -
Carrying amount 23,664,430.98 5,391,994.84
Note: The Group believes that the acceptor of its bank acceptance and commercial acceptance
have high credit ratings with no significant credit risks; therefore, no provision for credit
loss is made.
(2) As at 30 June 2021, there are no notes receivable pledged.
(3) As at 30 June 2021, the Group has no notes receivable endorsed or discounted but
unmatured at the balance sheet date.
(4) As at 30 June 2021, there are no notes reclassified to accounts receivable due to the
drawers' inability to settle the note.
(5) The Group has no notes receivable written off for the period from 1 January to 30 June
2021.
- 65 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
4. Accounts receivable
(1) Accounts receivable disclosed by aging
Unit: RMB
Closing balance
Aging
Accounts receivable Provision for credit loss Proportion (%)
Within 1 year 1,833,629,561.08 18,474,325.56 1.01
More than 1 year but not exceeding 2 years 50,613,308.68 17,682,820.43 34.94
More than 2 years but not exceeding 3 years 5,082,039.70 2,840,927.94 55.90
More than 3 years 40,585,676.63 37,671,574.10 92.82
Total 1,929,910,586.09 76,669,648.03
(2) Disclosure of accounts receivable by categories
Unit: RMB
Closing balance Opening balance (Restated)
Credit Expected credit
Carrying Provision for Carrying Provision for
rating loss rate (%) Book value Book value
amount credit loss amount credit loss
A 0.00-0.10 968,715,740.70 641,983.99 968,073,756.71 680,599,675.12 658,001.13 679,941,673.99
B 0.10-0.30 545,761,792.88 1,529,163.25 544,232,629.63 520,087,318.71 639,654.91 519,447,663.80
C 0.30-50.00 347,540,479.95 24,250,944.08 323,289,535.87 207,630,761.65 23,911,382.65 183,719,379.00
D 50.00-100.00 67,892,572.56 50,247,556.71 17,645,015.85 60,465,077.73 50,224,377.50 10,240,700.23
Total 1,929,910,586.09 76,669,648.03 1,853,240,938.06 1,468,782,833.21 75,433,416.19 1,393,349,417.02
(3) Changes in provision for credit loss of accounts receivable
Unit: RMB
Lifetime expected credit Lifetime expected credit
Item Total
loss (not credit-impaired) loss (credit-impaired)
Opening balance (Restated) 25,209,038.69 50,224,377.50 75,433,416.19
Carrying amount of accounts receivable at 1 January 2021
-- Transferred to credit-impaired
- - -
accounts receivables
-- Reversed to not credit-impaired
- - -
accounts receivable
Provision for the period 3,416,820.67 232,035.00 3,648,855.67
Reversal for the period -2,378,003.37 -94,712.96 -2,472,716.33
Impact of foreign currency
174,235.33 -114,142.83 60,092.50
statement translation
Closing balance 26,422,091.32 50,247,556.71 76,669,648.03
There are no accounts receivable written off during this period.
(4) The top five balances of account receivables classified by debtor
Unit: RMB
Proportion of the Closing balance of
Name of entity Closing balance Aging amount to the total provision for
accounts receivable (%) credit loss
Client A 177,065,984.10 Within 1 year 9.18 177,065.98
Within 1 year, more than 1
Client B 84,452,452.50 4.38 69,700.20
year but not exceeding 2 years
Within 1 year, more than 1
Client C 78,575,366.80 4.07 32,399.01
year but not exceeding 2 years
Within 1 year, more than 1
Client D 64,839,808.72 3.36 10,996,831.56
year but not exceeding 2 years
Within 1 year, more than 1
Client E 55,855,729.72 2.89 94,092.90
year but not exceeding 2 years
Total 460,789,341.84 23.88 11,370,089.65
- 66 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
5. Accounts receivable financing
(1) Accounts receivable financing classification
Unit: RMB
Items Closing balance Opening balance
Bank acceptance measured at fair value 272,889,319.83 217,449,966.41
(2) On 30 June 2021, the Group has no pledged account receivables financing.
(3) As at 30 June 2021, account receivables financing endorsed or discounted which are not
yet due at the balance sheet date are as follows
Unit: RMB
Closing balance Opening balance
Items
Derecognized Recognized Derecognized Recognized
Bank acceptance measured at fair value 35,921,012.26 - 129,866,604.18 -
6. Prepayme nts
(1) Aging analysis of prepayment
Unit: RMB
Closing balance Opening balance (Restated)
Aging
Amount Proportion (%) Amount Proportion (%)
Within 1 year 86,006,306.73 99.53 50,438,796.50 98.48
More than 1 year but not exceeding 2 years 313,849.85 0.36 585,435.07 1.14
More than 2 years but not exceeding 3
8,020.97 0.01 - -
years
More than 3 years 86,207.76 0.10 193,638.86 0.38
Total 86,414,385.31 100.00 51,217,870.43 100.00
(2) As at 30 June 2021, the Group has no significant prepayments aged more than one year.
(3) The top five balances of prepayments classified by entities
Unit: RMB
Proportion of the closing
Relationship with the
Name of entity Closing balance balance to the total
Company
prepayments (%)
Saham Assurance Togo S.A. Non-related party 6,584,963.34 7.61
Fairfax Brasil Seguros Corporativos S.A. Non-related party 4,555,092.72 5.27
Jianshi Construction Co., Ltd. Non-related party 3,142,057.55 3.64
Shenyang Ruilida Technology Co., Ltd. Non-related party 3,011,882.88 3.49
CCCC First Harbour Consultants CO.,LTD Non-related party 2,852,256.00 3.30
Total 20,146,252.49 23.31
7. Other receivables
7.1 Summary of other receivables
Unit: RMB
Opening balance
Item Closing balance
(Restated)
Dividend receivable 1,257,817,553.23 258,137,208.69
Other receivables 3,322,888,529.46 3,303,155,105.29
- 67 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
Total 4,580,706,082.69 3,561,292,313.98
- 68 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
7. Other receivables - continued
7.2 Dividend receivable
(1) Presentation of dividend receivable
Unit: RMB
Opening balance
Name of investee Closing balance
(Restated)
Shanghai International Port (Group) Co., Ltd. 756,630,823.35 -
China Nanshan Development (Group) Incorporation ("Nanshan Group") 316,246,500.00 210,831,000.00
Liaoning Port Co., Ltd. 74,242,730.44 -
Qingdao Port International Co., Ltd. 39,116,713.02 -
Tin-Can Island Container Terminal Ltd 22,996,441.34 33,289,037.77
Others 49,843,421.71 14,275,566.52
Total 1,259,076,629.86 258,395,604.29
Less: Provision for credit loss 1,259,076.63 258,395.60
Book value 1,257,817,553.23 258,137,208.69
(2) Significant dividend receivable aged more than 1 year
Unit: RMB
Closing balance of
Name of investee Closing balance Aging Why unrecovered provision for
credit losses
More than 1 year Relevant procedures are being
Nanshan Group 140,554,000.00 but not exceeding handled and it is expected to be 140,554.00
2 years recovered by the end of 2021
Total 140,554,000.00 140,554.00
(3) Changes in provision for credit loss of dividend receivable
Unit: RMB
Stage 1 Stage 2 Stage 3
Item Expected credit Lifetime expected credit Lifetime expected credit Total
loss in 12 months loss (not credit-impaired) loss (credit-impaired)
Opening balance 258,395.60 - - 258,395.60
Carrying amount of dividend receivables at 1 January 2021
-- Transfer to Stage 2 - - - -
-- Transfer to Stage 3 - - - -
-- Reverse to Stage 2 - - - -
-- Reverse to Stage 1 - - - -
Provision for the period 1,000,681.03 - - 1,000,681.03
Reversal for the period - - - -
Transfer-out on derecognition
of financial assets (including - - - -
direct write-down)
Other changes - - - -
Closing balance 1,259,076.63 - - 1,259,076.63
- 69 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
7. Other receivables - continued
7.3 Other receivables
(1) Other receivables disclosed by aging
Unit: RMB
Closing balance
Aging Provision for
Other receivables Proportion (%)
credit loss
Within 1 year 2,572,619,131.98 57,240.17 -
More than 1 year but not exceeding 2 years 431,767,085.80 71,268.54 0.02
More than 2 years but not exceeding 3 years 502,052,317.18 295,399,464.85 58.84
More than 3 years 321,708,078.61 209,730,110.55 65.19
Total 3,828,146,613.57 505,258,084.11
(2) Disclosure of other receivables by nature
Unit: RMB
Opening balance
Item Closing balance
(Restated)
Land compensation (Note 1) 2,742,032,000.00 2,742,032,000.00
Operation compensation (Note 2) 662,024,082.30 687,057,815.03
Temporary payments 196,310,928.35 159,559,495.82
Compensation for profit or loss on transition 6,654,751.43 38,312,376.24
Deposits 21,836,368.72 24,819,304.63
Others 199,288,482.77 173,665,086.98
Total 3,828,146,613.57 3,825,446,078.70
Less: Provision for credit loss 505,258,084.11 522,290,973.41
Book value 3,322,888,529.46 3,303,155,105.29
Note 1: On 5 November 2019, Shantou China Merchants Port Group Co., Ltd.(hereinafter referred
to as "Shantou Port") entered into the Contract for the Acquisition of State-Owned Land
Use Rights in Shantou with Shantou Land Reserve Center. Pursuant to the contract, the
land and attached buildings of approximately 370.96 mu located in Zhuchi deepwater port
on the south of Zhongshan East Road of Shantou will be returned to Shantou Land
Reserve Center by Shantou Port, amounting to RMB 1,558,032,000.00. The above
mentioned land and attached buildings have been transferred before 31 December 2020.
As of 30 June 2021, the land compensation totaling to RMB 1,208,032,000.00 has not
been recovered yet.
On 21 August 2020, Shantou Port entered into the Contract for the Acquisition of State-
Owned Land Use Rights in Shantou with Shantou Haojiang District Land Reserve Center.
Pursuant to the contract, the land and attached buildings of approximately 152.34 mu
located in Queshi Wutian, Haojiang District, Shantou City will be returned to Shantou
Haojiang District Land Reserve Center by Shantou Port, amounting to RMB
250,000,000.00. The above mentioned land and attached buildings have been transferred
before 31 December 2020. As of 30 June 2021, the land compensation of RMB
200,000,000.00 has not been recovered yet.
- 70 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
7. Other receivables - continued
7.3 Other receivables - continued
(2) Disclosure of other receivables by nature - continued
Note 1: - continued
On 22 December 2020, Shantou Port entered into the Contract for the Acquisition of State-
Owned Land Use Rights in Shantou with Shantou Land Reserve Center. Pursuant to the
contract, the land and attached buildings of approximately 648.78 mu located in Zhuchi
deepwater port of Shantou will be returned to Shantou Land Reserve Center by Shantou
Port, amounting to RMB 2,724,876,000.00. 320 mu of land and attached buildings have
been transferred before 31 December 2020. As of 30 June 2021, the land compensation of
RMB 1,334,000,000.00 has not been recovered yet. The remaining 328.78 mu of land and
attached buildings have not been transferred, which will be presented as held-for-sale
assets by the Group.
Note 2:It refers to the operating compensation that the subsidiary of the Company shall collect
from the holding company of its minority shareholders according to the agreement,
amounting to RMB 662,024,082.30. The above amount has been overdue. On 30 June
2021, the corresponding balance of impairment on credit loss amounted to RMB
468,709,082.30.
(3) Provision for credit loss on other receivables
As part of the Group's credit risk management, the Group conducts internal credit ratings for its
customers and determines the expected loss rate for other receivables for each rating. Such
expected average loss rates are based on actual historical impairments while taking account of the
current and future economic conditions.
As at 30 June 2021, the credit risk and expected credit loss of other receivables of each category
of customers are presented as below:
Unit: RMB
Closing balance Opening balance (Restated)
Lifetime Lifetime Lifetime Lifetime
Expected
Credit Expected expected expected Expected expected expected
credit loss
rating credit loss in credit loss credit loss Total credit loss in credit loss credit loss Total
rate (%)
12 months (not credit- (credit- 12 months (not credit- (credit-
impaired) impaired) impaired) impaired)
A 0.00-0.10 3,129,879,304.06 - - 3,129,879,304.06 3,102,785,902.96 - - 3,102,785,902.96
B 0.10-0.30 - - - - - - - -
C 0.30-50.00 - - - - - - - -
D 50.00-100.00 - - 698,267,309.51 698,267,309.51 - - 722,660,175.74 722,660,175.74
Account
3,129,879,304.06 - 698,267,309.51 3,828,146,613.57 3,102,785,902.96 - 722,660,175.74 3,825,446,078.70
balance
Provision
for credit 332,459.65 - 504,925,624.46 505,258,084.11 308,222.19 - 521,982,751.22 522,290,973.41
loss
Book value 3,129,546,844.41 - 193,341,685.05 3,322,888,529.46 3,102,477,680.77 - 200,677,424.52 3,303,155,105.29
- 71 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
7. Other receivables - continued
7.3 Other receivables - continued
(4) Changes in provision for credit loss of other receivables
Unit: RMB
Stage 1 Stage 2 Stage 3
Expected Lifetime expected Lifetime expected
Item Total
credit loss in credit loss (not credit loss (credit-
12 months credit-impaired) impaired)
Opening balance (Restated) 308,222.19 - 521,982,751.22 522,290,973.41
Carrying amount of other receivables at 1 January 2021
--Transfer to Stage 2 - - - -
--Transfer to Stage 3 -109,558.16 - 109,558.16 -
-- Reverse to Stage 2 - - - -
--Reverse to Stage 1 - - - -
Provision for the period 146,421.25 - 808,708.09 955,129.34
Reversal for the period -12,625.63 - -218,736.67 -231,362.30
Impact of foreign currency
- - -17,756,656.34 -17,756,656.34
statement translation
Closing balance 332,459.65 - 504,925,624.46 505,258,084.11
(5) The Group has no other receivables written off for the period from 1 January to 30 June
2021.
(6) At the end of the year, the top five balances of other receivables classified by debtor are as
below:
Unit: RMB
Proporti on of the Provision for credit
Name of entity Nature Closing bal ance Aging amount to the other loss at the end of
receivables (% ) the peri od
Within 1 year; More
Entity A Land co mpensation 2,542,032,000.00 than 1 year but not 66.40 39,052.09
exceeding 2 years
More than 2 years but
Operation
Entity B 662,024,082.30 not exceeding 3 years; 17.30 468,709,082.30
compensation
More than 3 years
Entity C Land co mpensation 200,000,000.00 Within 1 year 5.22 3,072.51
Within 1 year; More
Entity D Temporary payments 45,174,070.15 1.18 4,355.19
than 3 years
Entity E Temporary payments 33,692,528.00 More than 3 years 0.88 3,369.25
Total 3,482,922,680.45 90.98 468,758,931.34
8. Inventories
(1) Categories of inventories
Unit: RMB
Closing bal ance Opening bal ance (Restated)
Provision for Provision for
Item Carrying Carrying
decline in value Book value decline in value Book value
amount amount
of i nventories of i nventories
Raw materials 168,953,489.68 884,061.15 168,069,428.53 168,411,323.61 884,061.15 167,527,262.46
Goods on hand 28,930,830.87 - 28,930,830.87 34,780,194.84 - 34,780,194.84
Revolving materials - - - - - -
Others 13,008,687.75 - 13,008,687.75 12,516,519.00 - 12,516,519.00
Total 210,893,008.30 884,061.15 210,008,947.15 215,708,037.45 884,061.15 214,823,976.30
- 72 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
8. Inventories - continued
(2) Provision for decline in value of inventories
Unit: RMB
Decrease
Item Opening balance Provision Closing balance
Reversal Write-off
Raw materials 884,061.15 - - - 884,061.15
Note: As at 30 June 2021, the Group has no capitalized borrowing cost in the balance of
inventories.
9. Assets held for sale
Book value at the Fair value at the Estimated
Item Estimated disposal time
end of the period end of the period disposal expenses
The relocation will be
Long-term assets held for sale 337,442,757.28 1,380,876,000.00 5,608,306.69 completed in the second
half of 2021
Less: Provision for impairment
- - -
of assets held for sale
Book value 337,442,757.28 - -
Note: See Note (V) 7.3 (2) for details.
10. Non-current assets due within one year
Unit: RMB
Item Closing balance Opening balance
Long-term receivables due within one year 74,876,906.59 67,760,233.67
Less: Provision for credit loss 74,876.91 67,760.23
Book value 74,802,029.68 67,692,473.44
11. Other current assets
Unit: RMB
Opening balance
Item Closing balance
(Restated)
Structural deposits 455,413,041.12 102,749,431.10
Including: Principal 450,000,000.00 100,000,000.00
Interest receivable 5,413,041.12 2,749,431.10
Prepaid taxes 69,620,382.35 47,556,756.97
Others (Note) 296,908,759.07 283,767,897.09
Total 821,942,182.54 434,074,085.16
Less: Provision for credit loss - -
Book value 821,942,182.54 434,074,085.16
Note: Refer to the VAT credits of domestic subsidiaries.
- 73 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
12. Long-term receivables
(1) Details of long-term receivables
Unit: RMB
Closing bal ance Opening bal ance
Item Provision for Provision for
Account balance Book value Account balance Book value
credit loss credit loss
Principal and interest
of receivables for - - - 286,330,144.62 286,330.14 286,043,814.48
cooperation
Advances to
3,635,346,843.54 3,635,346.85 3,631,711,496.69 3,663,271,923.98 3,663,271.92 3,659,608,652.06
shareholders (Note)
Financing lease deposits 10,000,000.00 10,000.00 9,990,000.00 10,000,000.00 10,000.00 9,990,000.00
Total 3,645,346,843.54 3,645,346.85 3,641,701,496.69 3,959,602,068.60 3,959,602.06 3,955,642,466.54
Less: Long-term
receivables due 74,876,906.59 74,876.91 74,802,029.68 67,760,233.67 67,760.23 67,692,473.44
within 1 year
Long-term receivables
3,570,469,936.95 3,570,469.94 3,566,899,467.01 3,891,841,834.93 3,891,841.83 3,887,949,993.10
due over 1 year
Note: It refers to the terminal acquisition project funds advanced by the Group to its associate
Terminal Link SAS. As at 31 June 2021, the principal and interest totaled
RMB 2,771,361,793.06. See Note (V) 13 for details.
(2) Provision for credit loss on long-term receivables
Unit: RMB
Stage 1 Stage 2 Stage 3
Lifetime expected Lifetime expected
Item Expected credit loss in Total
credit loss (not credit- credit loss (credit-
12 months
impaired) impaired)
Opening balance 3,959,602.06 - - 3,959,602.06
Carrying amount of long-term receivables at 1 January 2021
-- Transfer to Stage 2 - - - -
-- Transfer to Stage 3 - - - -
-- Reverse to Stage 2 - - - -
-- Reverse to Stage 1 - - - -
Provision for the period 7,116.69 - - 7,116.69
Reversal for the period -321,371.90 - - -321,371.90
Transfer-out on
derecognition of financial
- - - -
assets(including direct
write-down)
Other changes - - - -
Closing balance 3,645,346.85 - - 3,645,346.85
(3) As at 30 June 2021, there are no long-term receivables derecognized due to the transfer of
financial assets.
(4) There are no assets and liabilities arising from the transfer or continuing involvement of
long-term receivables at 30 June 2021.
- 74 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
13. Long-term equity investments
Unit: RMB
Changes for the year
Effect of translation
Reconciling items Closing value of
Accounting Opening balance Investment profit Cash dividends or of financial
Investees from other Other equity Provision for Closing balance provision for
method (Restated) Increase or loss under profits announced Others statements
comprehensive movements impairment impairment
equity method of issuance denominated in
income
foreign currencies
I. Joint ventures
Euro-Asia Oceangate S.à r.l. Equity method 2,533,296,561.96 - 35,657,835.28 - - - - - -16,457,622.51 2,552,496,774.73 -
Port of Newcastle Equity method 2,149,048,944.67 - 4,976,890.86 - - -14,535,702.56 - - -47,195,626.40 2,092,294,506.57 -
Qingdao Qianwan United Container Terminal
Equity method 1,507,359,082.53 - 30,849,525.86 - 2,892,779.72 - - - - 1,541,101,388.11 -
Co., Ltd.
Yantai Port Group Laizhou Port Co., Ltd. Equity method 782,832,086.50 - 16,309,101.16 - - -24,643,441.33 - - - 774,497,746.33 -
Fujian Zhaohang Logistics Management
Partnership (Limited Partnership) Equity method 452,283,105.00 - 933,240.00 - - - - - - 453,216,345.00 -
("Zhanhang Logistics")
Others Equity method 1,441,507,425.18 - 6,310,579.77 - 46,231.88 -5,626,285.18 - - 87,526.04 1,442,325,477.69 -
Subtotal Equity method 8,866,327,205.84 - 95,037,172.93 - 2,939,011.60 -44,805,429.07 - - -63,565,722.87 8,855,932,238.43 -
II. Associates Equity method
Shanghai International Port (Group) Co., Ltd. Equity method 25,361,783,181.41 2,327,928,232.22 -2,048,420.87 -55,795,954.31 -793,927,959.22 - - 128,559.17 26,838,067,638.40 -
Nanshan Group Equity method 5,390,946,895.65 - 560,718,761.21 -25,111.72 -11,872,718.00 -110,922,285.34 - - - 5,828,845,541.80 -
Terminal Link SAS (Note 1) Equity method 6,803,553,044.91 2,114,714.77 182,473,114.97 -68,157,830.91 -2,261,145.24 -1,393,859,331.74 - - -235,560,046.61 5,288,302,520.15 -
Liaoning Port Co., Ltd. Equity method 3,455,964,513.62 - 91,600,129.01 -361,292.97 430,925,728.64 -81,444,346.03 - - 4,629,361.40 3,901,314,093.67 351,616,807.79
Shenzhen China Merchants Qianhai Industrial
Equity method 7,176,706,008.55 - 108,224,200.00 - - - - - - 7,284,930,208.55 -
Development Co., Ltd.
China Merchants Northeast Asia Development
Equity method 1,007,786,285.71 - 6,331,456.35 - - - - - - 1,014,117,742.06 -
Investment Co., Ltd.
Others Equity method 8,179,344,087.21 207,300,447.62 185,046,350.56 14,874,835.21 40,666.37 -136,978,096.10 - - -31,862,041.98 8,417,766,248.89 -
Subtotal 57,376,084,017.06 209,415,162.39 3,462,322,244.32 -55,717,821.26 361,036,577.46 -2,517,132,018.43 - - -262,664,168.02 58,573,343,993.52 351,616,807.79
Total 66,242,411,222.90 209,415,162.39 3,557,359,417.25 -55,717,821.26 363,975,589.06 -2,561,937,447.50 - - -326,229,890.89 67,429,276,231.95 351,616,807.79
Note 1:As at 25 November 2019, CMPort Co., Ltd. (hereinafter referred to as "CMPort"), a subsidiary of the Company, entered into a comprehensive
Memorandum of Agreement with Terminal Link, an associate of the Company, and CMA CGM S.A., the controlling shareholder of Ter minal
Link, pursuant to which the CMPort proposes to subscribe for the US$468 million Mandatory Convertible Bonds issued by Terminal Link
SAS, and to grant the US$500 million Loan to Terminal Link SAS to finance its proposed acquisition of 10 terminals. The Group subscribed
the mandatory convertible bonds (equivalent to RMB 2,746,841,398.03) on 26 March 2020, and offered Terminal Link SAS a long-term loan
at the interest rate of 6% to support its proposed acquisition of the terminals. As of 30 June 2021, the Company's total principal and interest
due from Terminal Link SAS is equivalent to RMB 2,771,361,793.06.
- 75 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
14. Other investments in equity instrume nts
(1) Details of other investments in equity instruments
Unit: RMB
Investees Closing balance Opening balance
China Ocean Shipping Agency (Shenzhen) Co., Ltd. 144,424,830.00 144,424,830.00
Others 37,592,227.74 37,042,227.74
Total 182,017,057.74 181,467,057.74
(2) Details of non-trading equity instruments
Unit: RMB
Amounts Why transferred
transferred to to retained
Di vi dends income
Accumul ated retained earnings Why designated as earnings from
Item recognized for the
gains/losses from other FVTOIC other
year
comprehensive comprehensive
income income
The intention of
China Ocean Shipping holding is neither for
- 130,914,830.00 - N/A
Agency (Shenzhen) Co., Ltd. sale nor profits in
short-term
The intention of
holding is neither for
Others 460,000.00 9,749,796.00 - N/A
sale nor profits in
short-term
Total 460,000.00 140,664,626.00 -
15. Other non-current financial assets
Unit: RMB
Item Closing balance Opening balance
Financial assets at FVTPL 863,909,085.69 910,807,452.56
Including: Investments in equity instruments 863,909,085.69 910,807,452.56
Including: Qingdao Port International Co., Ltd. 839,486,772.90 886,385,139.77
Others 24,422,312.79 24,422,312.79
- 76 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
16. Investment properties
(1) Investment properties measured under cost method
Unit: RMB
Item Land use rights Buildings Total
I.Total original carrying amount
1. Balance at 1 January 2021 105,727,492.82 6,278,220,271.05 6,383,947,763.87
2. Increase in the current period - 1,301,543.51 1,301,543.51
3. Balance at 30 June 2021 105,727,492.82 6,279,521,814.56 6,385,249,307.38
II.Accumulated depreciation and amortization
1. Balance at 1 January 2021 33,534,616.24 791,657,872.42 825,192,488.66
2. Increase in the current period 1,141,052.03 93,694,376.37 94,835,428.40
3. Balance at 30 June 2021 34,675,668.27 885,352,248.79 920,027,917.06
III. Impairment provision
1. Balance at 1 January 2021 - - -
2. Increase in the current period - - -
3. Decrease in the current period - - -
4. Balance at 30 June 2021 - - -
IV. Book value
1. At 30 June 2021 71,051,824.55 5,394,169,565.77 5,465,221,390.32
2. At 1 January 2021 72,192,876.58 5,486,562,398.63 5,558,755,275.21
(2) Investment properties without ownership certificates
Unit: RMB
Item Closing balance Opening balance
Buildings and land use rights 18,481,584.41 19,256,400.05
17. Fixed assets
17.1 Summary of fixed assets
Unit: RMB
Opening balance
Item Closing balance
(Restated)
Fixed assets 30,663,383,834.76 29,478,004,411.21
Disposal of fixed assets 1,027,777.17 1,750,748.00
Total 30,664,411,611.93 29,479,755,159.21
- 77 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
17. Fixed assets - continued
17.2 Fixed assets
(1) Details of fixed assets
Unit: RMB
Machinery and
Port and terminal equipment, furniture Motor vehicles and
Item Buildings Total
facilities and fixture and other cargo ships
equipment
I. Total original carrying amount
1. Balance at 1 January 2021 (Restated) 29,858,213,065.80 1,847,328,245.18 15,259,298,893.86 2,133,169,183.60 49,098,009,388.44
2. Increase for the period 1,119,106,131.48 34,529.27 922,689,183.47 42,212,223.03 2,084,042,067.25
(1) Purchase 7,208,444.44 34,529.27 46,162,076.39 1,603,929.52 55,008,979.62
(2) Transfer from construction in progress 1,111,897,687.04 - 876,527,107.08 40,608,293.51 2,029,033,087.63
3. Decrease for the period 52,003,686.97 - 128,369,056.74 19,861,149.00 200,233,892.71
(1) Disposal or retirement 52,003,686.97 - 128,369,056.74 19,861,149.00 200,233,892.71
4. Reclassification adjustment 15,713,152.86 -14,125,996.90 -1,587,155.96 - -
5. Effect of changes in foreign exchange 62,874,766.83 -773,479.99 -18,033,622.16 -4,577,767.79 39,489,896.89
6. Closing balance 31,003,903,430.00 1,832,463,297.56 16,033,998,242.47 2,150,942,489.84 51,021,307,459.87
II. Accumulated depreciation
1. Balance at 1 January 2021 (Restated) 8,832,870,876.12 468,211,667.37 9,319,665,495.98 941,729,519.54 19,562,477,559.01
2. Increase for the period 452,410,453.01 38,568,823.81 372,794,122.43 50,527,215.20 914,300,614.45
(1) Provision 452,410,453.01 38,568,823.81 372,794,122.43 50,527,215.20 914,300,614.45
3. Decrease for the period 44,695,567.65 - 117,981,301.56 17,139,001.83 179,815,871.04
(1) Disposal or retirement 44,695,567.65 - 117,981,301.56 17,139,001.83 179,815,871.04
4. Reclassification adjustment 7,053,281.89 -6,877,372.10 -175,909.79 - -
5. Effect of changes in foreign exchange 8,041,299.17 -273,181.04 -3,197,969.19 -1,136,244.47 3,433,904.47
6. Closing balance 9,255,680,342.54 499,629,938.04 9,571,104,437.87 973,981,488.44 20,300,396,206.89
III. Impairment provision
1. Balance at 1 January 2021 57,419,468.96 63,906.47 44,042.79 - 57,527,418.22
2. Increase for the period - - - - -
3. Decrease for the period - - - - -
4. Closing balance 57,419,468.96 63,906.47 44,042.79 - 57,527,418.22
IV. Book value
1. Closing book value 21,690,803,618.50 1,332,769,453.05 6,462,849,761.81 1,176,961,001.40 30,663,383,834.76
2. Book value at 1 January 2021 (Restated) 20,967,922,720.72 1,379,052,671.34 5,939,589,355.09 1,191,439,664.06 29,478,004,411.21
(2) The Group has no fixed assets that are temporarily idle as at 30 June 2021.
(3) Fixed assets leased out under operating leases
Unit: RMB
Closing carrying Opening carrying
Item
amount amount
Buildings 227,514,640.19 291,567,507.17
Port and terminal facilities 20,157,074.22 79,578,478.13
Machinery and equipment, furniture and fixture and
6,448,730.20 8,646,797.33
other equipment
Commercial and residential housing 1,478,120.99 4,757,652.18
Total 255,598,565.60 384,550,434.81
(4) Fixed assets without ownership certificates
Unit: RMB
Closing carrying Opening carrying
Item
amount amount
Buildings, port and terminal facilities 1,704,969,754.34 1,751,680,587.08
- 78 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
17. Fixed assets - continued
17.2 Fixed assets - continued
(5) Other issues
Unit: RMB
Item Closing balance Remark
Cost of fixed assets fully depreciated but still in use
4,005,652,647.56
as at 30 June 2021
Cost of fixed assets temporarily idle as at 30 June 2021 -
Fixed assets disposed and retired for the period:
Cost of fixed assets disposed and retired 200,233,892.71
Net value of fixed assets disposed and retired 20,418,021.67
Profit or loss on disposal or retirement of fixed assets 7,938,502.51
17.3 Disposal of fixed assets
Unit: RMB
Item Closing balance Opening balance
Machinery and equipment, furniture and fixture and
891,665.65 1,216,187.48
other equipment
Motor vehicles and cargo ships 111,866.95 17,000.05
Port and terminal facilities 24,244.57 517,560.47
Total 1,027,777.17 1,750,748.00
18. Construction in progress
18.1 Summary of construction in progress
Unit: RMB
Item Closing balance Opening balance
Construction in progress 4,062,944,531.95 5,366,181,331.72
Materials for construction of fixed assets 19,865,759.78 15,249,274.46
Total 4,082,810,291.73 5,381,430,606.18
18.2 Construction in progress
(1) Details of construction in progress
Unit: RMB
Closing balance Opening balance
Item Carrying Provision for Carrying Provision for
Book value Book value
amount impairment amount impairment
Port and terminal facilit ies 3,408,458,381.00 - 3,408,458,381.00 4,662,213,617.98 - 4,662,213,617.98
Berths and yards 253,837,731.30 - 253,837,731.30 336,353,712.35 - 336,353,712.35
Infrastructure 202,849,501.52 - 202,849,501.52 197,699,601.64 - 197,699,601.64
Ship under construction 35,875,862.57 - 35,875,862.57 58,674,526.32 - 58,674,526.32
Others 161,923,055.56 - 161,923,055.56 111,239,873.43 - 111,239,873.43
Total 4,062,944,531.95 - 4,062,944,531.95 5,366,181,331.72 - 5,366,181,331.72
- 79 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
18. Construction in progress - continued
18.2 Construction in progress - continued
(2) The top ten balances of construction in progress
Unit: RMB
Proportion of Interest
Effect of Amount of Including:
Other accumulated Construction capitalization
Increase for Transfer to changes in accumulated capitalized
Item Budget amount Opening balance decreas es for Closing balance construction rate for the Capital source
the period fixed assets foreign progress (%) capitalized interest for the
the period investment in current period
exchange interest period
budget (%) (%)
Reconstruction project of Berth 1#-4#, 25,219,359.80 Self-funding and
2,315,216,765.16 1,544,226,816.60 475,615,870.23 1,800,807,797.76 3,040,699.54 - 215,994,189.53 87.11 87.11 66,037,883.84 3.87
Haixing Wharf loan
Reconstruction project of container, Self-funding and
2,622,414,278.20 986,965,991.96 1,671,680.20 - - -6,425,952.26 982,211,719.90 56.19 56.19 798,733.97 264,284.00 2.35
oil terminal and tank area, HIPG loan
Project of Grain Dispatch Warehouse at Self-funding and
620,000,000.00 487,050,717.25 20,596,884.33 - - - 507,647,601.58 81.88 81.88 5,821,698.43 3,268,813.97 4.19
Berth 2#,3# Phase III , Machong Port loan
Xiashan port general wharf project, Self-funding and
737,792,300.00 464,639,005.10 13,731,990.53 - - - 478,370,995.63 64.84 64.84 21,301,444.40 7,282,727.04 4.41
Zhanjiang Port loan
Donghaidao port wharf project for bulk Self-funding and
905,348,400.00 366,583,393.31 6,108,117.16 - - - 372,691,510.47 41.17 41.17 37,593,000.95 6,108,117.16 4.41
grains, Zhanjiang Port loan
Petrifaction old tank area reconstruction, Self-funding and
218,378,500.00 182,469,597.24 275,922.32 - - - 182,745,519.56 83.68 83.68 5,024,262.73 - -
Phase I, Zhanjiang Port loan
Baoman Port container wharf extension Self-funding and
2,342,775,800.00 156,012,479.92 1,458,658.08 - - - 157,471,138.00 6.72 6.72 964,740.46 - -
project, Phase I, Zhanjiang Port loan
Baoman stuffing and destuffing service Self-funding and
606,521,505.83 137,075,214.56 - - - - 137,075,214.56 22.60 22.60 16,689,500.56 - -
area, Phase I Project, Zhanjiang Port loan
Guangao starting project, Shantou Port 120,120,000.00 99,337,616.67 700,420.39 7,766,623.83 - - 92,271,413.23 83.28 83.28 - - - Self-funding
Reconstruction project of Bulk cargo terminal Self-funding and
190,000,000.00 68,846,809.70 792,954.16 - - - 69,639,763.86 36.65 36.65 1,091,753.38 792,954.16 4.41
Yard 16#, Zhanjiang Port loan
Total 10,678,567,549.19 4,493,207,642.31 520,952,497.40 1,808,574,421.59 3,040,699.54 -6,425,952.26 3,196,119,066.32 155,323,018.72 42,936,256.13
- 80 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
18. Construction in progress - continued
18.3 Materials for construction of fixed assets
Unit: RMB
Closing bal ance Opening bal ance
Item Carrying Provision for Carrying Provision for
Book value Book value
amount impairment amount impairment
Materials for construction
19,865,759.78 - 19,865,759.78 15,249,274.46 - 15,249,274.46
of fixed assets
19. Right-of-use assets
(1) Details of right-of-use assets
Unit: RMB
Machinery and
Port and terminal equipment, Motor vehicles and
Item Buildings furniture and Others Total
facilities fixture and other cargo ships
equipment
I. Cost
1. Balance at 1 January 2021
6,772,369,651.12 161,394,715.13 466,008,746.03 7,620,740.24 2,662,142,323.86 10,069,536,176.38
(Restated)
2. Increase for the period 1,011,596.29 15,605,749.60 2,498,995.66 - 496,541.00 19,612,882.55
(1) Purchase 1,011,596.29 15,605,749.60 2,498,995.66 - 496,541.00 19,612,882.55
3. Decrease for the period - 790,335.73 1,112,176.23 - 5,875,368.95 7,777,880.91
(1) Termination of lease - 790,335.73 1,112,176.23 - 5,875,368.95 7,777,880.91
4. Effect of changes in foreign
-35,642,868.79 -988,717.80 209,513.70 - -17,183,063.80 -53,605,136.69
exchange
5. Balance at 30 June 2021 6,737,738,378.62 175,221,411.20 467,605,079.16 7,620,740.24 2,639,580,432.11 10,027,766,041.33
II. Accumulated depreciation
1. Balance at 1 January 2021
588,760,107.94 30,621,557.69 109,303,923.22 3,743,305.60 249,365,468.99 981,794,363.44
(Restated)
2. Increase for the period 118,847,081.95 9,919,043.59 16,141,188.11 802,075.20 20,818,094.41 166,527,483.26
(1) Provision 118,847,081.95 9,919,043.59 16,141,188.11 802,075.20 20,818,094.41 166,527,483.26
3. Decrease for the period - 782,821.60 1,112,176.23 - 5,875,368.95 7,770,366.78
(1) Termination of lease - 782,821.60 1,112,176.23 - 5,875,368.95 7,770,366.78
4 Effect of changes in foreign
-1,783,727.14 -118,239.26 192,602.23 - -1,472,753.85 -3,182,118.02
exchange
5. Closing balance 705,823,462.75 39,639,540.42 124,525,537.33 4,545,380.80 262,835,440.60 1,137,369,361.90
III. Impairment provision
1. Balance at 1 January 2021 - - - - - -
2. Increase for the period - - - - - -
3. Decrease for the period - - - - - -
4. Balance at 30 June 2021 - - - - - -
IV. Book value
1. Book value at 30 June 2021 6,031,914,915.87 135,581,870.78 343,079,541.83 3,075,359.44 2,376,744,991.51 8,890,396,679.43
2. Book value at 1 January 2021
6,183,609,543.18 130,773,157.44 356,704,822.81 3,877,434.64 2,412,776,854.87 9,087,741,812.94
(Restated)
- 81 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
19. Right-of-use assets - continued
(2) Amount recognized in profit or loss
Unit: RMB
Amount incurred in
Category
the current period
Depreciation expenses of right-of-use assets (Note 1) 166,527,483.26
Interest expenses on lease liabilities (Note 2) 41,716,504.99
Expenses for short-term leases 26,645,495.07
Expenses for leases of low value assets 380,593.33
Variable lease payments not included in the
-
measurement of lease liabilities (Note 3)
Revenue from sublease of right-of-use assets 9,959,795.19
Note 1:No depreciation expenses of right-of-use assets are capitalized in the period from 1
January to 30 June 2021.
Note 2: No interest expenses of lease liabilities are capitalized in the period from 1 January to 30
June 2021.
Note 3: No variable lease payments were included in the measurement of lease liabilities in the
period from 1 January to 30 June 2021.
(3) The total cash outflows in relation to leases for the period from 1 January to 30 June 2021
amounting to RMB 163,769,387.34.
(4) Lease assets of the Group with the lease term as follows:
Category Lease term
Port and terminal facilities 1-99 years
Buildings 1-5 years
Machinery and equipment, furniture and fixture and other equipment 1-6 years
Motor vehicles and cargo ships 5 years
Others 1-35 years
(5) As at 30 June 2021, the Group's port and terminal facilities and machinery and equipment
and vessels amounting to RMB 1,006,264,593.38 are subject to a purchase option at the
end of the renewal lease at a price below the market price.
- 82 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
20. Intangible assets
(1) Details of intangible assets
Unit: RMB
Land use rights Terminal
Items Others Total
(Note 1 ) management rights
I. Total orig inal carrying amount
1. Balance at 1 January 2021 (Restated) 13,925,403,678.69 8,996,212,561.23 1,123,714,042.87 24,045,330,282.79
2. Increase for the year 324,710.39 17,000,554.83 15,059,741.62 32,385,006.84
(1) Purchase - 17,000,554.83 12,019,042.08 29,019,596.91
(2) Other increase 324,710.39 - 3,040,699.54 3,365,409.93
3. Decrease for the period 9,813,069.25 - 402,167.37 10,215,236.62
(1) Disposal 9,813,069.25 - 402,167.37 10,215,236.62
4. Effect of changes in foreign exchange 267,799.32 8,103,283.29 20,371,745.93 28,742,828.54
5. Balance at 30 June 2021 13,916,183,119.15 9,021,316,399.35 1,158,743,363.05 24,096,242,881.55
II. Accumulated depreciation
1. Balance at 1 January 2021 (Restated) 3,399,466,693.48 1,444,000,560.60 429,682,486.61 5,273,149,740.69
2. Increase for the year 161,360,563.78 111,569,935.99 30,682,691.23 303,613,191.00
(1) Provision 161,360,563.78 111,569,935.99 30,682,691.23 303,613,191.00
3. Decrease for the period 1,400,681.08 - 11,171.28 1,411,852.36
(1) Disposal 1,400,681.08 - 11,171.28 1,411,852.36
4. Effect of changes in foreign exchange 214,583.93 8,028,047.76 4,603,829.41 12,846,461.10
5. Balance at 30 June 2021 3,559,641,160.11 1,563,598,544.35 464,957,835.97 5,588,197,540.43
III. Impairment provision
1. Balance at 1 January 2021 - - - -
2. Increase for the period - - - -
3. Decrease for the period - - - -
4. Balance at 30 June 2021 - - - -
IV. Book value
1. Book value at 30 June 2021 10,356,541,959.04 7,457,717,855.00 693,785,527.08 18,508,045,341.12
2. Book value at 1 January 2021 (Restated) 10,525,936,985.21 7,552,212,000.63 694,031,556.26 18,772,180,542.10
Note 1:The Group has obtained the land use right of 1,049,946.00 square meters of berths and
storage yards in Chiwan Port Area from Nanshan Group (These plots are included within
the Chiwan watershed, including the 2.2 square kilometers invested by the shareholder of
Nanshan Group—Shenzhen Investment Holding Co., Ltd. and the plots formed from land
reclamation by Nanshan Group). The cost was RMB 1,400,288,984.00, with a useful life
of 20 to 50 years. Among the plots, the land use right with an area of 270,692.00 square
meters (the cost was RMB122,623,476.00) was invested by Nanshan Group upon
restructuring of the Company, and the remaining land use rights were obtained by the
Group from Nanshan Group in the form of long-term lease.
At present, since Nanshan Group has not obtained the land use right of the land within the
Chiwan watershed, including the land leased to the Group as capital investment mentioned
above, the Group is unable to obtain the property right certificate of relevant land and
buildings built on the aforesaid land.
- 83 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
20. Intangible assets - continued
(1) Details of intangible assets - continued
Note 1: - continued
On 20 March 2001, 18 June 2003, 29 September 2004 and 2 July 2020, Nanshan Group
made a commitment to all the land use rights obtained by the Group as of that date:
Nanshan Group will irrevocably and unconditionally agree that such land use rights are
attributed to the Group. Nanshan Group guarantees that the assignees of such land use
rights and their successors and their assignees are fully indemnified against any loss, costs
and liabilities, claims or legal proceedings arising out of or in connection with any actual
or potential illegality and unenforceability of the land use agreements and related
documents executed by the Group and hereafter to be executed by the Group. Accordingly,
the management of the Company considers that the relevant assets will not have any
significant impairment risk due to the failure to obtain the relevant land use certificate, and
the Group will not have any significant contingent liabilities arising therefrom.
The management of the Company understands that Nanshan Group is actively negotiating
with relevant government departments about the land issues left over from the past, but it
is impossible to reliably estimate the date when the Group can obtain the property right
certificate of relevant land and the buildings thereon.
As at 30 June 2021, the lease agreement on the land use right of 194,293.90 square meters
of the above land with the cost of RMB 137,749,984.16 has expired.
(2) Land use rights without ownership certificates on 30 June 2021:
Unit: RMB
Closing carrying Opening carrying
Item
amount amount
Land use rights 1,033,428,561.05 1,051,555,795.12
- 84 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
21. Development expenditure
Unit: RMB
Decrease in the current period
Opening Increase in the Transfer to Transfer to Transfer Transfer to Closing
Item
balance current period intangible construction to fixed profit or loss balance
assets in progress assets for the period
CTOS upgrading - 22,228,037.18 - - - 22,228,037.18 -
Research and development of quay
crane auxiliary production - 15,857,995.47 - - - 15,857,995.47 -
monitoring
Research and development of
- 6,281,699.80 - - - 6,281,699.80 -
intelligent gate entry system
Integrated ICT solution for China
- 6,233,232.01 - - - 6,233,232.01 -
M erchants smart container terminal
Development and application of
automatic control system for heavy
19,689,935.13 6,095,701.06 - - - - 25,785,636.19
oil, diesel, gasoline and methanol
process
Research and development of
automatic box grasping and placing
- 3,283,319.72 - - - 3,283,319.72 -
system in remote RTG box area
based on vision technology
Research and development of crane
remote monitoring and management
system based on fieldbus and - 2,597,904.63 - - - 2,597,904.63 -
real-time Ethernet communication
technology
Customized development of block
chain customs clearance project in - 2,532,946.93 - - - 2,532,946.93 -
Dawan District
Research and development of
intelligent tally system based on
- 2,344,425.68 - - - 2,344,425.68 -
many to many operation and
multi engine recognition pattern
Crude oil unit train loading equipment
20,656,125.15 1,218,823.23 - - - - 21,874,948.38
key technology research
Others 23,891,674.95 48,844,213.07 - - - 36,984,849.83 35,751,038.19
Total 64,237,735.23 117,518,298.78 - - - 98,344,411.25 83,411,622.76
22. Goodwill
(1) Original value of goodwill
Unit: RMB
Effect of
changes in
Investee Opening bal ance Increase Decrease Closing bal ance
foreign
exchange
TCP Participaes S.A. ("TCP") 2,562,567,253.74 - - 126,201,691.77 2,688,768,945.51
Mega Shekou Container Terminals Limited 1,815,509,322.42 - - - 1,815,509,322.42
CMPort 993,992,000.00 - - - 993,992,000.00
Shantou Port 552,317,736.65 - - - 552,317,736.65
Zhanjiang Port (Group) Co., Ltd. ("Zhanjiang
418,345,307.68 - - - 418,345,307.68
Port")
Shenzhen Mawan Pro ject 408,773,001.00 - - - 408,773,001.00
Ningbo Daxie Ch ina Merchants International
188,497,194.41 - - - 188,497,194.41
Terminals Co mpany Limited ("Ningbo Daxie")
Others 288,255,850.88 - - - 288,255,850.88
Total 7,228,257,666.78 - - 126,201,691.77 7,354,459,358.55
(2) Provision for impairment of goodwill
Effect of
changes in
Investee Opening bal ance Increase Decrease Closing bal ance
foreign
exchange
Shantou Port 552,317,736.65 - - - 552,317,736.65
- 85 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
23. Long-term prepaid expenses
Unit: RMB
Opening bal ance Increase in the Amortizati on in Other Closing
Item
(Restated) current period the current period changes balance
Tonggu channel widening project (Note 1) 491,846,986.99 - 9,317,926.36 - 482,529,060.63
West port area public channel widening
249,214,515.10 - 3,167,126.46 - 246,047,388.64
project (Note 2)
Relocation project of Nanhai Rescue
39,768,848.30 - 553,684.20 - 39,215,164.10
Bureau
Expenditures for the improvement of
17,479,223.03 - 657,165.60 - 16,822,057.43
leasedfixed assets
Others 76,690,162.49 14,313,122.72 9,772,988.27 - 81,230,296.94
Total 874,999,735.91 14,313,122.72 23,468,890.89 - 865,843,967.74
Note 1:This represent the Group's actual expenses on the Shenzhen West Port Area Tonggu
Channel 210-270 Meters Widening Project. According to relevant resolutions of Shenzhen
municipal government, the expenses incurred for the 210-240 Meters Widening Project
are born by the enterprise and government on 60% to 40% principle, and the 240-270
Meters Widening Project are born by the enterprise and government on 50% to 50%
principle. The Company's subsidiary has included the expenses on deepening the channel
in the item of "long-term prepaid expenses", and amortized such expenses over the
expected useful life of 35 or 40 years using straight-line method since the completion of
the two widening projects in 2008 and 2019, respectively.
Note 2:This represent the Group's actual expenses on the Shenzhen Western Port Area Public
Channel Widening Project, of which the widening of 240-270 meters in the first section
was completed on 1 June 2019 and the widening of 240-270 meters in the second and third
sections was completed on 5 November 2020. According to relevant resolutions of
Shenzhen Municipal Government, the expenses incurred for the project are born by the
enterprise and government on 50% to 50% principle. The Company's subsidiary has
included the expenses on deepening the channel in the item of "long-term prepaid
expenses", and amortized such expenses over the expected useful life of 40 years using
straight-line method since the completion of each section of the channel widening project.
24. Deferred tax assets and deferred tax liabilities
(1) Deferred tax assets without offsetting
Unit: RMB
Closing bal ance Opening bal ance(restated)
Item Deducti ble temporary Deferred tax Deducti ble temporary Deferred tax
di fferences assets di fferences assets
Unrealized profit 779,690,982.52 190,320,514.68 782,637,004.71 190,978,844.60
Depreciation of fixed assets 121,310,030.64 28,712,287.01 121,474,197.24 30,363,658.82
Deductible losses 572,737,154.46 189,371,992.77 375,133,696.59 121,834,055.80
Provision for credit loss 44,383,253.14 11,664,894.56 44,716,751.81 11,155,565.87
Provisions 91,170,414.60 24,817,367.97 83,415,919.34 22,408,962.33
Deferred inco me 36,918,962.56 8,713,485.37 40,760,480.40 9,289,713.04
Amort izat ion of co mputer 11,007,022.11 2,751,755.53 11,007,022.11 2,751,755.53
Organization costs 8,436,714.76 2,109,178.68 8,436,714.76 2,109,178.68
Provision for impairment losses of assets 4,012,361.15 1,003,090.29 884,061.15 221,015.29
Others 120,673,655.70 30,927,823.04 121,790,935.17 29,744,326.80
Total 1,790,340,551.64 490,392,389.90 1,590,256,783.28 420,857,076.76
- 86 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
24. Deferred tax assets and deferred tax liabilities - continued
(2) Deferred tax liabilities without offsetting
Unit: RMB
Closing bal ance Opening bal ance (restated)
Item Taxable temporary Deferred tax Taxable temporary Deferred tax
di fferences liabilities di fferences liabilities
Withholding dividend income tax 30,831,586,676.38 2,098,951,939.51 28,188,540,389.01 1,925,457,143.90
Fair value adjustment of assets
8,370,676,375.40 1,895,744,093.18 8,566,522,113.13 1,925,197,755.69
acquired by business combination
Changes in fair value of other
1,596,786,871.29 218,756,520.99 1,625,996,080.95 225,877,441.96
non-current financial assets
Depreciation of fixed assets 850,552,596.25 226,633,992.82 826,231,081.71 217,461,491.73
Changes in fair value of other equity
115,753,452.78 32,705,069.78 140,581,630.00 35,145,407.50
investments
Others 87,476,715.26 18,481,632.72 87,206,887.29 18,413,901.95
Total 41,852,832,687.36 4,491,273,249.00 39,435,078,182.09 4,347,553,142.73
(3) Deferred tax assets or liabilities presented at the net amount after offsetting
Unit: RMB
Item Deferred tax assets
Offset amount of Deferred tax assets Offset amount of
or liabilities after
deferred tax assets or liabilities after deferred tax assets
offsetting in the
and liabilities in the offsetting in the and liabilities in the
pri or peri od
current period current period pri or peri od
(restated)
Deferred tax assets - 490,392,389.90 - 420,857,076.76
Deferred tax liabilities - 4,491,273,249.00 - 4,347,553,142.73
(4) Details of unrecognized deferred tax assets
Unit: RMB
Item Closing bal ance Opening bal ance(restated)
Deductible temporary differences 470,699,766.13 428,572,235.55
Deductible losses 2,327,577,006.82 2,518,481,088.94
Total 2,798,276,772.95 2,947,053,324.49
The Group recognizes deferred income tax assets to the extent of future taxable income that is
likely to be obtained to offset the deductible temporary differences and deductible losses. For the
excess of deductible temporary differences and deductible losses over future taxable income, no
deferred tax assets is recognized.
(5) Deductible losses for unrecognized deferred tax assets will be expired in the following
years:
Unit: RMB
Year Closing bal ance Opening bal ance
2021 69,294,264.10 244,394,853.17
2022 601,982,775.30 630,217,470.89
2023 787,117,391.41 793,817,471.49
2024 506,944,165.04 508,391,813.28
2025 338,117,516.17 341,622,332.73
2026 23,382,229.62 -
No expiration date 738,665.18 37,147.38
Total 2,327,577,006.82 2,518,481,088.94
- 87 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
- 88 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
25. Other non-current assets
Unit: RMB
Item Closing balance Opening balance
Dachanwan port area Phase II land replacement payment
916,884,222.49 916,884,222.49
(Note 1)
Advances of channel project (Note 2) 954,021,599.64 940,472,488.75
Prepayments of land use rights 132,410,404.86 132,334,704.86
Prepayments of fixed assets 56,867,265.58 32,623,333.85
Prepayments of terminal franchise 30,060,781.71 31,113,113.10
Others 75,654,020.00 85,040,820.59
Total 2,165,898,294.28 2,138,468,683.64
Note 1: Primarily the lands located in Shenzhen Qianhaiwan Logistics Park has been returned to
government in 2019 by the Company's subsidiaries Antongjie Terminal Services
(Shenzhen) Co., Ltd. ("ATJ") and Ansujie Terminal Services (Shenzhen) Co., Ltd., in
which Qianhai Administration replaced 55% of the total land area of T102-0166 and
T102-0167 held by ATJ and ASJ and the corresponding shoreline (the land area is
approximately 531,300 square meters) to the Phase II of Dachan Bay Port Area. As of 30
June 2021, the change procedures for the land use right of Phase II of Dachan Bay Port
have not yet been completed.
Note 2: This represent that the Company's subsidiary Zhanjiang Port, upon its reorganization into
a joint stock company in 2007, signed the Channel Arrangement Agreement with State-
owned Assets Supervision and Administration Commission of Zhanjiang ("Zhanjiang
SASAC") and China Merchants International Terminal (Zhanjiang) Co., Ltd. According to
the agreement, the channel belongs to Zhanjiang SASAC, therefore the Company included
the advances of channel project that should be repaid by Zhanjiang SASAC in other non-
current assets.
26. Short-term borrowings
(1) Classification of short-term borrowings
Unit: RMB
Item Closing balance Opening balance
Credit loan 3,411,832,103.87 8,976,788,882.26
Guaranteed loan (Note) 1,506,877,500.00 1,506,986,666.67
Total 4,918,709,603.87 10,483,775,548.93
Note: The loan is guaranteed by the Company.
(2) At 30 June 2021, the Group has no short-term borrowings that were overdue.
27. Notes payable
Unit: RMB
Category Closing balance Opening balance
Bank acceptance 3,071,689.38 1,600,100.00
Commercial acceptance 7,384,712.19 5,481,672.32
Total 10,456,401.57 7,081,772.32
- 89 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
- 90 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
28. Accounts payable
(1) Details of accounts payable are as follows:
Unit: RMB
Opening balance
Item Closing balance
(Restated)
Service fee 248,936,293.62 146,212,519.71
Construction fee 100,743,629.49 117,439,992.70
Material purchase 172,352,075.72 144,294,086.08
Rental fee 14,113,730.16 7,494,989.48
Equipment payments 19,673,881.49 20,712,191.08
Others 189,421,526.24 171,818,920.54
Total 745,241,136.72 607,972,699.59
(2) Significant accounts payable aged more than one year
Unit: RMB
Item Amount Reason for outstanding
The government planning project has not
Shenzhen Municipal Bureau of Land and
21,642,795.50 been completed, and the certificates of
Resources
property rights has not been processed.
29. Receipts in advance
(1) Summary of receipts in advance
Unit: RMB
Opening balance
Item Closing balance
(Restated)
Administrative fee receipt in advance 11,822,984.86 10,350,161.96
Rental fee receipt in advance 1,926,687.04 2,715,835.65
Equity transfer payment receipt in advance - 20,492,849.00
Ship transfer payment receipt in advance - 3,450,560.00
Others 6,843,103.14 2,500,721.29
Total 20,592,775.04 39,510,127.90
(2) There is no significant receipts in advance aged more than one year at 30 June 2021,
30. Contract liabilities
(1) Summary of contract liabilities
Unit: RMB
Opening balance
Item Closing balance
(Restated)
Port charges received in advance 101,290,640.18 78,789,466.29
Warehousing fee received in advance 10,605,233.98 18,460,680.90
Service fee received in advance 51,091,543.88 49,782,911.22
Others 25,334,845.70 10,409,051.26
Total 188,322,263.74 157,442,109.67
(2) There is no significant change in the book value of contract liabilities in the current period.
- 91 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
30. Contract liabilities - continued
(3) There is no significant contract liabilities aged more than one year at the end of the period.
(4) Qualitative and quantitative analysis of contract liabilities
The contract liability mainly represents the amount received by the Group to provide port
services to customers. The payment is collected according to the contractual payment time.
The Group recognizes contract revenue based on the progress of the contract. The contract
liabilities will be recognized as income after the Group fulfills its performance obligations.
(5) Revenue recognized in the current period and included in the opening carrying amount of
contract liabilities
An amount of RMB 128,507,666.65 included in the book value of contract liabilities at the
beginning of 2021 has been recognized as revenue in the current period, including contract
liabilities arising from settled but unfinished construction resulting from the contract of
receipt of port charges in advance amounting to RMB 75,071,420.10, contract liabilities
arising from settled but unfinished construction resulting from the contract of receipt of
service fee in advance amounting to RMB 41,265,052.90, contract liabilities arising from
settled but unfinished construction resulting from the other contracts in advance
amounting to RMB 10,770,493.42 as well as contract liabilities arising from settled but
unfinished construction resulting from other contracts amounting to RMB 1,400,700.23.
31. Employee benefits payable
(1) Details of employee benefits payable are as follows
Unit: RMB
Opening balance Increase in the Decrease in the
Item Closing balance
(Restated) current period current period
1. Short-term benefits 721,298,746.97 1,514,037,351.27 1,577,859,716.50 657,476,381.74
2. Post-employment benefits
6,217,684.84 149,016,929.25 147,057,080.31 8,177,533.78
- defined contribution plan
3. Termination benefits - 3,294,150.13 3,294,150.13 -
4. Other benefits due within
- 1,887,726.57 1,887,726.57 -
one year
5. Others -619,306.39 3,579,963.29 3,009,714.42 -49,057.52
Total 726,897,125.42 1,671,816,120.51 1,733,108,387.93 665,604,858.00
- 92 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
31. Employee benefits payable - continued
(2) Short-term benefits
Unit: RMB
Opening balance Increase in the Decrease in the
Item Closing balance
(Restated) current period current period
I. Wages and salaries, bonuses,
688,968,854.26 1,267,933,479.70 1,336,413,637.85 620,488,696.11
allowances and subsidies
II. Staff welfare - 56,281,483.93 53,860,289.30 2,421,194.63
III. Social insurance charges 16,094,126.74 75,148,996.45 73,410,034.22 17,833,088.97
Including: Medical insurance 14,865,150.41 61,270,708.40 59,733,267.04 16,402,591.77
Work injury insurance 6,258.14 6,264,226.00 6,220,517.02 49,967.12
Maternity insurance 30,801.59 3,993,677.27 3,984,217.91 40,260.95
Others 1,191,916.60 3,620,384.78 3,472,032.25 1,340,269.13
IV. Housing funds -490,321.89 88,201,016.89 87,804,379.22 -93,684.22
V. Labor union and employee
16,726,087.86 22,391,926.44 22,290,928.05 16,827,086.25
education funds
VI. Other short-term benefits - 4,080,447.86 4,080,447.86 -
Total 721,298,746.97 1,514,037,351.27 1,577,859,716.50 657,476,381.74
(3) Defined contribution plan
Unit: RMB
Opening balance Increase in the Decrease in the
Item Closing balance
(Restated) current period current period
I. Basic pension 6,112,958.64 113,229,739.45 111,413,897.60 7,928,800.49
II. Unemployment insurance 64,028.24 1,914,909.47 1,908,541.53 70,396.18
III. Enterprise annuity plan 40,697.96 33,872,280.33 33,734,641.18 178,337.11
Total 6,217,684.84 149,016,929.25 147,057,080.31 8,177,533.78
The Company and its subsidiaries participates in the social security contributions and the
unemployment insurance plan established by government institutions as required. According to
such plans, the Group contributes in proportion to the local government. Except for the above-
mentioned deposit fees, the Group have no outstanding contributions to be paid to the social
security contributions and the unemployment insurance plan. The corresponding expenses are
included in the current profit and loss or the cost of related assets when incurred.
32. Taxes payable
Unit: RMB
Opening balance
Item Closing balance
(Restated)
Enterprise income tax 2,202,241,094.68 2,320,197,283.53
VAT 20,811,984.10 13,239,447.16
Others 82,097,323.59 36,821,959.30
Total 2,305,150,402.37 2,370,258,689.99
- 93 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
33. Other payables
(1) Summary of other payables
Unit: RMB
Opening balance
Item Closing balance
(Restated)
Dividends payable 1,782,621,471.55 70,388,849.49
Other payables 2,083,558,339.76 2,410,828,718.91
Total 3,866,179,811.31 2,481,217,568.40
(2) Dividends payable
Unit: RMB
Opening balance
Item Closing balance
(Restated)
Ordinary share dividends 1,782,621,471.55 70,388,849.49
Including: External entities (Public minority shareholders/Public
546,522,246.55 -
Hong Kong shares)
China Merchants Port Investment Development Co., Ltd. 436,486,486.24 -
China Merchants Union Development Co., Ltd. 348,500,295.23 -
China Merchants Gangtong Development (Shenzhen) Co., Ltd. 140,933,640.00 -
Economic and Trade Guande Development Co., Ltd. 75,608,046.12 -
Public A shares 60,075,288.32 -
Public B shares 47,340,864.36 -
Sri Lanka Ports Authority 34,032,542.04 34,255,854.79
Shenzhen Infrastructure Investment Fund Partnership (LLP) 24,643,069.16 -
Broadford Global Limited 21,019,399.04 -
China Merchants Zhangzhou Development Zone Co., Ltd. 20,000,000.00 20,000,000.00
Dalian Port Container Development Co., Ltd. ("Dalian Port
12,160,517.31 12,160,517.31
Container")
Sinotrans Shipping Co., Ltd. 10,049,355.79 -
Dalian Port Centralized Logistics Co., Ltd. ("Centralized
3,972,477.39 3,972,477.39
Logistics")
Orienture Holdings Company Limited 1,277,244.00 -
As at 30 June 2021, the dividend payable aged over one year amounts to RMB 16,132,994.70,
representing the dividends not yet received by the investor.
(3) Other payables
(a) Disclosure of other payables by nature
Unit: RMB
Opening balance
Item Closing balance
(Restated)
Amount payable for construction and quality warranty 846,691,892.68 1,044,821,435.49
Deposits 438,293,530.71 360,604,022.08
Customer discount 107,997,934.21 119,368,121.44
Accrued expenses 187,582,826.10 229,820,205.45
Port construction and security fee 55,473,279.54 55,085,280.96
Balance of land use rights transfer 11,295,700.00 11,295,700.00
Others 436,223,176.52 589,833,953.49
Total 2,083,558,339.76 2,410,828,718.91
- 94 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
33. Other payables - continued
(3) Other payables - continued
(b) Significant other payables with aging over 1 year
Unit: RMB
Reason for being outstanding
Company name Closing balance
or carried forward
Shenzhen Transportation Committee 65,157,128.97 To be paid after confirmation by mutual parties
Wuxi HDHM Co., Ltd. 44,295,045.47 To be paid after confirmation by mutual parties
Shanghai Zhenhua Heavy Industries Co., Ltd. 33,244,983.56 To be paid after confirmation by mutual parties
The contracted settlement condition has not been
China First Metallurgical Group Co., Ltd. 31,590,351.07
reached
Shantou Transportation Bureau 31,358,355.47 To be paid after confirmation by mutual parties
The contracted settlement condition has not been
Guangdong Jiaye Reserve Logistics Co., Ltd. 25,000,000.00
reached
The contracted settlement condition has not been
CCCC-FHDI Engineering Co., Ltd. 21,878,790.74
reached
Qingdao Maritime Bureau 20,713,982.12 To be paid after confirmation by mutual parties
Zhanjiang Transportation Bureau 19,643,770.17 To be paid after confirmation by mutual parties
Shantou Finance Bureau 10,000,000.00 To be paid after confirmation by mutual parties
The contracted settlement condition has not been
Harman Technology (Shenzhen) Co., Ltd. 5,917,392.48
reached
The contracted settlement condition has not been
CCCC Fourth Harbor Engineering Co., Ltd. 5,711,128.84
reached
Total 314,510,928.89
34. Non-current liabilities due within one year
Unit: RMB
Opening balance
Item Closing balance
(Restated)
Long-term loans due within one year 1,411,312,342.09 2,074,906,728.26
Including: Credit loan 476,229,413.83 749,046,479.86
Guaranteed loan 315,299,410.01 739,805,701.02
Mortgage loan 619,783,518.25 586,054,547.38
Bonds payable due within one year 6,836,936,147.15 1,042,773,072.37
Long-term payable due within one year 69,078,497.48 3,562,994.44
Long-term employee benefits payable due within one year 36,811,951.00 36,811,951.00
Lease liabilities due within one year 299,138,901.13 322,950,258.37
Other non-current liabilities due within one year 90,413,566.88 83,582,696.63
Total 8,743,691,405.73 3,564,587,701.07
35. Other current liabilities
Unit: RMB
Opening balance
Item Closing balance
(Restated)
Short-term bonds payable 2,009,274,534.10 2,215,478,001.40
Accrued professional agency fee 125,942,529.78 138,158,158.51
Others 30,300,767.36 30,032,826.03
Total 2,165,517,831.24 2,383,668,985.94
- 95 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
35. Other current liabilities - continued
Changes of short-term bonds payable:
Unit: RMB
Amount issued Interest accrued Discount or Repayment in
Name of bond Face value Date of issue Term of the Amount of issue Opening balance in the current based on par premium the current Closing balance
bond period value amortization period
1.99% RMB1 billion, Super & Short-term
1,000,000,000.00 2020-06-05 270 days 1,000,000,000.00 1,011,418,032.80 - 3,302,515.17 - 1,014,720,547.97 -
Commercial Paper
2.5% RMB1.2 billion Super & Short-term \
1,200,000,000.00 2020-11-13 180 days 1,200,000,000.00 1,204,059,968.60 - 11,340,579.32 - 1,215,400,547.92 -
Commercial Paper
2.30% RMB 800 million Super & Short-term
800,000,000.00 2021-01-22 90 days 800,000,000.00 - 800,000,000.00 4,593,698.63 - 804,593,698.63 -
Commercial Paper
2.73% RMB 1 billion Super & Short-term
Commercial Paper 1,000,000,000.00 2021-03-22 180 days 1,000,000,000.00 - 1,000,000,000.00 7,581,054.65 - - 1,007,581,054.65
2.55% RMB 1 billion Super & Short-term 1,000,000,000.00 2021-06-07 180 days 1,000,000,000.00 - 1,000,000,000.00 1,693,479.45 - - 1,001,693,479.45
Commercial Paper
Total 5,000,000,000.00 5,000,000,000.00 2,215,478,001.40 2,800,000,000.00 28,511,327.22 - 3,034,714,794.52 2,009,274,534.10
- 96 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
36. Long-term borrowings
(1) Classification of long-term borrowings
Unit: RMB
Item Closing balance Opening balance
Credit borrowings 5,232,812,170.21 5,258,127,800.87
Guaranteed borrowings (Note 1) 1,097,904,954.91 1,629,960,889.64
Mortgage borrowings (Note 2) 2,415,373,499.85 2,593,140,731.56
Total 8,746,090,624.97 9,481,229,422.07
Less: Long-term borrowings due within one year 1,411,312,342.09 2,074,906,728.26
Including: Credit borrowings 476,229,413.83 749,046,479.86
Guaranteed borrowings 315,299,410.01 739,805,701.02
Mortgage borrowings 619,783,518.25 586,054,547.38
Long-term borrowings due after one year 7,334,778,282.88 7,406,322,693.81
During the period, the annual interest rate of the borrowing ranges from 1.20% to 5.78%.
Note 1: The loan was guaranteed by Shenzhen Magang Cangma Co., Ltd, China Merchants Port
Services (Shenzhen) Co., Ltd, CMPort.
Note 2: As at 30 June 2021, the Group obtained the long-term loan of RMB 2,415,373,499.85 (31
December 2020: RMB 2,593,140,731.56) with its entire equity in Colombo International
Container Terminals Limited (hereinafter referred to as "CICT"), and the entire equity in
Thesar Maritime Limited (hereinafter referred to as "TML"),, and the land use right, fixed
assets and construction in progress held by Guangdong Yide Port Co., Ltd. (hereinafter
referred to as "Yide Port"), the land use rights of Shenzhen Haixing Harbor Development
Co., Ltd. as well as the sea area use rights of Dongguan Chiwan Port Service Co., Ltd.
mortgaged as collaterals.
Details of mortgage borrowings are as follows:
Unit: RMB
Company name Closing bal ance Opening bal ance Collateral
China Develop ment Bank Corporation 890,910,467.90 1,027,981,472.96 The Group's entire equity in CICT
International Finance Corporation 299,127,562.75 364,480,624.59
African Develop ment Bank 137,436,988.29 167,372,490.13
Nederlandse Financierings -Maatschappij voor
113,183,402.12 137,905,387.30
Ontwikkelingslanden N.V.
The Opec Fund For International Develop ment 97,014,344.68 118,146,703.89 The Group's entire equity in TM L
Societe de Pro motion et de Participation pour
97,014,344.67 118,218,277.06
la Cooperation Economique S.A.
Deutsche Investitions-und
80,845,287.23 98,452,963.64
Entwicklungsgesellschaft MBH
Land use rights of Shenzhen Haixing
Bank o f China Qianhai Shekou Branch 241,341,293.92 241,370,822.05 Harbor Develop ment Co., Ltd (see Note
(V) 63)
Land use rights, fixed assets and
China Construction Bank Shunde Branch 274,236,922.78 210,178,757.55 construction in progress of Yide Po rt (see
Note (V) 63)
Sea area use rights of Dongguan Chiwan
China Merchants Bank Dongguan Branch 184,262,885.51 109,033,232.39
Warf Co., Ltd. (see Note (V) 63)
Total 2,415,373,499.85 2,593,140,731.56
- 97 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
37. Bonds payable
(1) Bonds payable
Unit: RMB
Item Closing balance Opening balance
4.375%, USD 900 million corporate bond 5,913,943,487.58 5,948,107,858.02
5.000%, USD 600 million corporate bond 3,926,753,639.09 3,950,488,734.13
4.750%, USD 500 million corporate bond 3,293,570,634.41 3,314,305,348.22
5.000%, USD 500 million corporate bond 3,262,240,035.06 3,280,606,167.04
4.890%, RMB 2.5 billion corporate bond 2,523,780,136.99 2,585,407,534.25
3.360%, RMB 2 billion corporate bond 2,066,826,666.69 2,033,040,000.00
IPCA + 7.8164%, BRL 428 million corporate bond 709,183,317.05 620,162,618.74
4.980%, RMB 400 million corporate bond 409,386,958.89 401,200,657.53
3.520%, RMB 2 billion corporate bond 2,014,658,630.13 -
Total 24,120,343,505.89 22,133,318,917.93
Less: Bonds payable due within one year 6,836,936,147.15 1,042,773,072.37
Bonds payable due after one year 17,283,407,358.74 21,090,545,845.56
- 98 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
37. Bonds payable - continued
(2) Changes of bonds payable
Unit: RMB
Amount issued in Interest Discount or Repayment in Effect of changes
Term of
Name of bonds Face value Date of issue Amount of issue Opening balance the current accrued based premium the current in foreign Closing balance
the bond
period on par value amorti zation period exchange
5.000%, USD 500 million corporate bond USD500,000,000.00 2012-5-4 10 years USD500,000,000.00 3,280,606,167.04 - 80,620,573.99 1,098,021.91 80,900,808.50 -19,183,919.38 3,262,240,035.06
4.750%, USD 500 million corporate bond USD500,000,000.00 2015-8-3 10 years USD500,000,000.00 3,314,305,348.22 - 76,627,305.36 3,294,819.56 76,855,768.08 -23,801,070.65 3,293,570,634.41
IPCA+7.8164%, BRL 428 million 5 years /
BRL428,047,000.00 2016-11-7 BRL428,047,000.00 620,162,618.74 - 53,033,722.16 4,058,987.94 - 31,927,988.21 709,183,317.05
corporate bond 6 years
4.890%, RMB 2.5 billion corporate bond RMB2,500,000,000.00 2017-4-21 5 years RMB2,500,000,000.00 2,585,407,534.25 - 60,622,602.74 - 122,250,000.00 - 2,523,780,136.99
4.375%, USD 900 million corporate bond USD900,000,000.00 2018-8-6 5 years USD900,000,000.00 5,948,107,858.02 - 126,980,188.62 5,016,087.81 127,269,374.99 -38,891,271.88 5,913,943,487.58
5.000%, USD 600 million corporate bond USD600,000,000.00 2018-8-6 10 years USD600,000,000.00 3,950,488,734.13 - 96,746,810.53 2,329,204.23 96,967,142.85 -25,843,966.95 3,926,753,639.09
4.980%, RMB 400 million corporate bond RMB400,000,000.00 2018-12-10 3 years RMB400,000,000.00 401,200,657.53 - 8,186,301.36 - - - 409,386,958.89
3.360%, RMB 2 billion corporate bond RMB2,000,000,000.00 2020-7-8 3 years RMB2,000,000,000.00 2,033,040,000.00 - 33,786,666.69 - - - 2,066,826,666.69
3.520%, RMB 2 billion corporate bond RMB2,000,000,000.00 2021-4-16 3 years RMB2,000,000,000.00 - 2,000,000,000.00 14,658,630.13 - - - 2,014,658,630.13
Total 22,133,318,917.93 2,000,000,000.00 551,262,801.58 15,797,121.45 504,243,094.42 -75,792,240.65 24,120,343,505.89
Less: Bonds payable due within one year 1,042,773,072.37 6,836,936,147.15
Bonds payable due aft er one year 21,090,545,845.56 17,283,407,358.74
- 99 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
38. Lease liabilities
Unit: RMB
Opening balance
Category Closing balance
(Restated)
Lease payment 2,278,003,192.85 2,452,804,794.89
Unrecognized financing cost -756,754,556.46 -802,003,552.44
Total 1,521,248,636.39 1,650,801,242.45
Less: Lease liabilities due within one year 299,138,901.13 322,950,258.37
Lease liabilities due after one year 1,222,109,735.26 1,327,850,984.08
39. Long-term payables
(1) Summary of long-term payables
Unit: RMB
Item Closing balance Opening balance
Long-term payables 1,246,617,547.37 1,192,028,415.01
Special payables 40,756,729.97 39,996,153.12
Total 1,287,374,277.34 1,232,024,568.13
Less: Long-term payables due within one year 69,078,497.48 3,562,994.44
Long-term payables due after one year 1,218,295,779.86 1,228,461,573.69
(2) Long-term payables
Unit: RMB
Item Closing balance Opening balance
Terminal management rights (Note 1) 810,214,400.60 749,658,074.16
Payable to minority shareholders of subsidiaries (Note 2) 431,018,385.63 437,238,325.33
Others 5,384,761.14 5,132,015.52
Total 1,246,617,547.37 1,192,028,415.01
Less: Long-term payables due within one year 69,078,497.48 3,562,994.44
Long-term payables due after one year 1,177,539,049.89 1,188,465,420.57
Note 1: As at 12 August 2011, the Group reached a 35-year building, operation and transfer agreement
through the subsidiary CICT and the Sri Lanka Port Authority on the building, operation,
management and development of the Colombo Port South Container Terminal (hereinafter
referred to as for "BOT"). The above-mentioned terminal operating rights purchase amount is
determined by discounting the amount to be paid in the future using the prevailing market
interest rate according to the BOT agreement. As at 30 June 2021, the amount is RMB
810,214,400.60.
Note 2: It is an unsecured loan from minority shareholder of Thesar Maritime Limited, a
subsidiary of the Company, with an annual interest rate of 4.65%.
- 100 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
39. Long-term payables - continued
(3) Special payables
Unit: RMB
Increase in the Decrease in the
Item Opening balance Closing balance Reason
current period current period
Refunds of Harbor
34,271,558.30 - 619,171.22 33,652,387.08 Note 1
Construction Fee
Employee housing fund 3,852,825.60 319,748.07 - 4,172,573.67 Note 2
Special funds for
1,871,769.22 1,060,000.00 - 2,931,769.22
scientific research
Total 39,996,153.12 1,379,748.07 619,171.22 40,756,729.97
Note 1: This represents the refund of the construction fee received by the Group from the Ministry
of Transport, Shenzhen Municipal Transportation Bureau. According to the "Port
Construction Fee Management Measures" promulgated by the Ministry of Finance, this
payment is dedicated to the construction of water transport infrastructure.
Note 2: This represent the repairing fund for public areas and public facilities and equipment
established after the Group's selling the public-owned house on the collectively allocated
land to employees. The fund is contributed by all the employees having ownership of the
house according to the rules, and is specially managed and used for specific purpose.
40. Long-term e mployee benefits payable
(1) Long-term employee benefits payable
Unit: RMB
Opening balance
Item Closing balance
(Restated)
Post-employment benefits - net liabilities of defined
427,481,498.24 429,830,989.42
benefits plan
Termination benefits 37,658,432.73 40,939,305.56
Others (Note) 62,471,559.55 73,756,355.48
Total 527,611,490.52 544,526,650.46
Less: Long-term employee benefits payable due within one year 36,811,951.00 36,811,951.00
Long-term employee benefits payable due after one year 490,799,539.52 507,714,699.46
Note: It is the employee resettlement cost related to land acquisition and reserve of Shantou Port,
a subsidiary of the Company.
- 101 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
40. Long-term e mployee benefits payable - continued
(2) Changes of defined benefits plan
Present value of defined benefits plan obligation:
Unit: RMB
Amount incurred in Amount incurred in
Item
the current period the previous period
I. Opening balance 429,830,989.42 454,383,940.25
II. Defined benefits cost included in profit or loss for the period 12,698,930.72 12,830,961.87
1. Current service cost 4,933,930.72 5,200,965.85
2. Interest adjustment 7,765,000.00 7,629,996.02
III. Defined benefits cost included in other comprehensive income -200,890.65 84,448.42
1. Actuarial gains (losses) - -
2. Effect of exchange rate changes -200,890.65 84,448.42
IV. Other changes -14,847,531.25 -13,651,880.90
1. Benefits paid -14,847,531.25 -13,651,880.90
V. Closing balance 427,481,498.24 453,647,469.64
The Company's subsidiaries provide the registered retirees and in-service staff with
supplementary post-employment benefit plans.
The Group hired a third-party actuary to estimate the present value of its above-mentioned
retirement benefit plan obligations in an actuarial manner based on the expected cumulative
welfare unit method. The Group recognizes the Group's liabilities based on the actuarial results.
The relevant actuarial gains or losses are included in other comprehensive income and cannot be
reclassified into profit or loss in the future. Past service costs are recognized in profit or loss for
the period in which the plan is revised. The net interest is determined by multiplying the defined
benefit plan net debt or net assets by the appropriate discount rate.
41. Provisions
Unit: RMB
Item Closing balance Opening balance Reason
Estimated expenses on Shantou Port land
66,138,336.08 66,138,336.08
acquisition and reservation
Pending litigation (Note) 22,497,381.33 17,277,583.26 Note
Sales discount 48,807,632.93 16,990,826.32
Total 137,443,350.34 100,406,745.66
Note: This represents the estimated compensation amount that the Company's subsidiary TCP
may need to pay due to the pending litigation.
42. Deferred income
Unit: RMB
Opening balance Increase in the current Decrease in the
Item Closing balance
(Restated) period current period
Government grants 1,112,272,684.13 - 21,019,719.24 1,091,252,964.89
Unrealized sale-and-
908,139.86 - 256,908.42 651,231.44
leaseback income
Total 1,113,180,823.99 - 21,276,627.66 1,091,904,196.33
- 102 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
42. Deferred income - continued
Items involving government grants are as follows:
Unit: RMB
Recognized in non- Recognized in Other Related to assets
Liabilities Opening balance Increase Closing balance
operating income comprehensive income /related to income
Refund from marine
355,820,652.47 - - 9,674,583.96 346,146,068.51 Related to assets
reclamation land
Channel widening project 483,473,225.10 - - 6,248,749.92 477,224,475.18 Related to assets
Special subsidy for facilities
240,227,572.98 - - 2,730,463.56 237,497,109.42 Related to assets
and equipment
Intelligent system subsidy 14,803,742.19 - - 1,590,504.95 13,213,237.24 Related to assets
Refund of land transfer
6,568,666.65 - - 133,600.02 6,435,066.63 Related to assets
charges
Others 11,378,824.74 - - 641,816.83 10,737,007.91 Related to assets
Total 1,112,272,684.13 - - 21,019,719.24 1,091,252,964.89
43. Other non-current liabilities
Unit: RMB
Item Closing balance Opening balance
TCP operating rights liability (Note 1) 3,438,158,858.69 2,888,395,641.53
Actuarial expenses for pension treatment of staff in
165,709,999.98 162,810,000.00
Public Security Bureau (Note 2)
Berth priority call right (Note 3) 12,153,073.77 14,597,949.13
Total 3,616,021,932.44 3,065,803,590.66
Less: Other non-current liabilities due within one year 90,413,566.88 83,582,696.63
Including: TCP operating rights liability 74,103,566.88 67,272,696.63
Actuarial expenses for pension treatment of
16,310,000.00 16,310,000.00
staff in Public Security Bureau (Note 2)
Other non-current liabilities due after one year 3,525,608,365.56 2,982,220,894.03
Note 1: As at 23 February 2018, CMPort, a subsidiary of the Company, acquired a 90% stake in
TCP and incorporate it into the consolidated financial statements of the Group. TCP has
operation right the port of Paranagua up to 2048. At 30 June 2021, the payment to acquire
the port operation rights is calculated based on local comprehensive price index.
Note 2: It refer that in 2020, Zhanjiang Port, a subsidiary of the Company, was completely taken
over by Zhanjiang Public Security Bureau which was transferred to Zhanjiang Municipal
People's Government in accordance with the Notice on printing and distributing the plan
on deepening the management system reform of port and shipping public security organs
(Zhong Yang Bian Ban Fa [2017] No. 327) and the notice on printing and distributing the
implementation plan on deepening the management system reform of port and shipping
public security organs in Guangdong Province (Yue Ji Bian Ban Fa [2018] No. 221). The
relevant assets of the former Zhanjiang Port Public Security Bureau, totaling
RMB 11,372,339.22, were transferred to Zhanjiang City. The on-the-job police were
transformed into civil servants in accordance with national regulations. The retired police
were included in the jurisdiction of pension insurance of Zhanjiang government organs
and institutions. The difference between the original standard of pension treatment and the
retirement treatment of Zhanjiang police (hereinafter referred to as "pension treatment
difference") will be undertaken by Zhanjiang Port. Zhanjiang Port accrued relevant
liabilities of RMB 165,709,999.98 according to the actuarial results.
- 103 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
43. Other non-current liabilities - continued
Note 3: This represents the berth priority call right as agreed in the contract entered into with the
clients in 2003, with total amount of USD 14 million. The Group must give priority to the
berthing requirements of the contracted customers during the contract period. The Group
amortized the berth priority right within 20 years using straight-line method. In the current
period, the amount included in operating income is RMB 2,444,875.35.
44. Share capital
Unit: RMB
Changes for the period
Capitalization
Item Opening balance New issue of Bonus Closing balance
of surplus Others Sub-total
share issue
reserve
For the period from 1 January to 30 June 2021
I. Restricted tradable shares
1. State-owned shares - - - - - - -
2. State-owned legal person shares - - - - - - -
3. Other domestic shares 9,496.00 - - - -2,130.00 -2,130.00 7,366.00
4. Foreign shares 1,148,648,648.00 - - - - - 1,148,648,648.00
Total restricted tradable shares 1,148,658,144.00 - - - -2,130.00 -2,130.00 1,148,656,014.00
II. Non-restricted tradable shares
1. Ordinary shares denominated in
593,820,070.00 - - - - - 593,820,070.00
RM B
2. Foreign capital shares listed
179,886,910.00 - - - 2,130.00 2,130.00 179,889,040.00
domestically
3. Foreign capital shares listed
- - - - - - -
overseas
4. Others - - - - - - -
Total non-restricted tradable shares 773,706,980.00 - - - 2,130.00 2,130.00 773,709,110.00
III. Total shares 1,922,365,124.00 - - - - - 1,922,365,124.00
Unit: RMB
Changes for the period
Capitalization
Item Opening balance New issue of Bonus Closing balance
of surplus Others Sub-total
share issue
reserve
For the year ended 31 December 2020
I. Restricted tradable shares
1. State-owned shares - - - - - - -
2. State-owned legal person
128,952,746.00 - - - -128,952,746.00 -128,952,746.00 -
shares
3. Other domestic shares 169,602.00 - - - -160,106.00 -160,106.00 9,496.00
4. Foreign shares 1,148,648,648.00 - - - - - 1,148,648,648.00
Total restricted tradable shares 1,277,770,996.00 - - - -129,112,852.00 -129,112,852.00 1,148,658,144.00
II. Non-restricted tradable shares
1. Ordinary shares denominated
464,858,324.00 - - - 128,961,746.00 128,961,746.00 593,820,070.00
in RM B
2. Foreign capital shares listed
179,735,804.00 - - - 151,106.00 151,106.00 179,886,910.00
domestically
3. Foreign capital shares listed
- - - - - - -
overseas
4. Others - - - - - - -
Total non-restricted tradable shares 644,594,128.00 - - - 129,112,852.00 129,112,852.00 773,706,980.00
III. Total shares 1,922,365,124.00 - - - - - 1,922,365,124.00
- 104 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
45. Capital reserve
Unit: RMB
Opening balance
Item Increase Decrease Closing balance
(Restated)
For the period from 1 January to 30 June 2021
Capital premium 22,730,949,021.44 1,114,458.90 38,392,129.42 22,693,671,350.92
Including: Capital contributed by investors 7,012,992,483.94 - - 7,012,992,483.94
Differences arising from business combination
13,345,628,834.48 - 38,392,129.42 13,307,236,705.06
involving enterprises under common control
Differences arising from acquisition of minority
714,658,981.71 - - 714,658,981.71
interests
Others 1,657,668,721.31 1,114,458.90 - 1,658,783,180.21
Other capital reserve 108,649,303.12 175,022,805.88 21,420,439.82 262,251,669.18
Including: Transfer from capital reserve under the previous
-2,781,133.00 - - -2,781,133.00
accounting system
Share based payment without exercise 10,096,607.62 5,859,913.77 - 15,956,521.39
Other changes of owners' equity of the investee
under equity method other than changes in net
101,333,828.50 3,627,961.64 21,420,439.82 83,541,350.32
profit orloss,profit distribution and other
comprehensive income
Others(Note) - 165,534,930.47 - 165,534,930.47
Total 22,839,598,324.56 176,137,264.78 59,812,569.24 22,955,923,020.10
Unit: RMB
Item Opening balance Increase Decrease Closing balance
For the year ended 31 December 2020
Capital premium 22,218,126,884.40 731,489,964.17 218,667,827.13 22,730,949,021.44
Including: Capital contributed by investors 7,012,992,483.94 - - 7,012,992,483.94
Differences arising from business combination
13,345,628,834.48 - - 13,345,628,834.48
involving enterprises under common control
Differences arising from acquisition of minority
419,130,116.03 514,196,692.81 218,667,827.13 714,658,981.71
interests
Others (Note) 1,440,375,449.95 217,293,271.36 - 1,657,668,721.31
Other capital Reserve 112,887,572.02 10,096,607.62 14,334,876.52 108,649,303.12
Including: Transfer from capital reserve under the previous
-2,781,133.00 - - -2,781,133.00
accounting system
Share based payment without exercise - 10,096,607.62 - 10,096,607.62
Other changes of owners' equity of the investee
under equity method other than changes in net,
115,668,705.02 - 14,334,876.52 101,333,828.50
profit or loss profit distribution and other
comprehensive income
Total 22,331,014,456.42 741,586,571.79 233,002,703.65 22,839,598,324.56
Note: The increase in the current period was mainly due to the merger of Yingkou Port Co., Ltd.
by the share swap of Liaoning Port Co., Ltd., an associate of the Group. Capital reserve
was increased by RMB 165,534,930.47 due to the effect of the passive dilution of the
Group's shareholding in Liaoning Port Co., Ltd.
- 105 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
46. Other comprehensive income
Unit: RMB
Amount incurred in the period
Less: Amount
included in other Less: Other
Post-tax income Post-tax income
comprehensive Less: comprehensive
Item Opening balance Pre-tax amount for attributable to the attributable to Closing balance
income in the prior Income tax income transfer to
the period parent company minority
periods transferred expense capital reserve
owner shareholders
to profit or loss this
period
For the period from 1 January to 30 June 2021:
I. Other comprehensive income that will not be
reclassified subsequently to profit or loss
81,416,891.26 109,893.35 - 137,500.00 228,315.37 -255,922.02 -43,860.69 81,689,067.32
Including: Changes arising from remeasurement of
11,318,269.18 - - - - - - 11,318,269.18
defined benefits plan
Other comprehensive income that can't be
transferred to profit or loss under equity -6,986,086.44 -440,106.65 - - -184,184.63 -255,922.02 -43,860.69 -7,126,410.38
method
Changes in fair value of other equity
77,084,708.52 550,000.00 - 137,500.00 412,500.00 - - 77,497,208.52
instruments
II. Other comprehensive income that will be reclassified
subsequently to profit or loss
-908,114,194.32 -314,158,757.54 - - -89,835,615.53 -224,323,142.01 537,780.33 -998,487,590.18
Including: Other comprehensive income that may be
31,725,280.52 -55,277,714.61 - - -23,133,723.56 -32,143,991.05 537,780.33 8,053,776.63
transferred to profit or loss under equity method
Translation differences of financial statements
denominated in foreign currencies
-939,839,474.84 -258,881,042.93 - - -66,701,891.97 -192,179,150.96 - -1,006,541,366.81
Total other comprehensive income -826,697,303.06 -314,048,864.19 - 137,500.00 -89,607,300.16 -224,579,064.03 493,919.64 -916,798,522.86
For the year ended 31 December 2020:
I. Other comprehensive income that will not be
82,969,758.27 6,911,190.88 - -33,528.75 -1,552,867.01 8,497,586.64 - 81,416,891.26
reclassified subsequently to profit or loss
Including: Changes arising from remeasurement of
1,069,722.83 35,016,155.14 - - 10,248,546.35 24,767,608.79 - 11,318,269.18
defined benefits plan
Other comprehensive income that can't be
transferred to profit or loss under equity 4,830,921.62 -28,307,578.26 - - -11,817,008.06 -16,490,570.20 - -6,986,086.44
method
Changes in fair value of other equity
77,069,113.82 202,614.00 - -33,528.75 15,594.70 220,548.05 - 77,084,708.52
instruments
II. Other comprehensive income that will be reclassified
subsequently to profit or loss -438,914,324.18 -1,856,601,660.49 - - -469,199,870.14 -1,387,401,790.35 - -908,114,194.32
Including: Other comprehensive income that may be
-58,950,164.54 217,642,457.56 - - 90,675,445.06 126,967,012.50 - 31,725,280.52
transferred to profit or loss under equity method
Translation differences of financial statements
-379,964,159.64 -2,074,244,118.05 - - -559,875,315.20 -1,514,368,802.85 - -939,839,474.84
denominated in foreign currencies
Total other comprehensive income -355,944,565.91 -1,849,690,469.61 - -33,528.75 -470,752,737.15 -1,378,904,203.71 - -826,697,303.06
- 106 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
47. Special reserve
Unit: RMB
Item Opening balance Increase Decrease Closing balance
For the period from 1 January to 30 June 2021
Production safety reserve 10,201,178.30 23,456,646.73 18,167,103.79 15,490,721.24
For the year ended 31 December 2020
Production safety reserve 12,386,734.70 57,538,524.86 59,724,081.26 10,201,178.30
48. Surplus reserve
Unit: RMB
Item Opening balance Increase Decrease Closing balance
For the period from 1 January to 30 June 2021
Statutory surplus reserve 890,690,322.28 - - 890,690,322.28
For the year ended 31 December 2020
Statutory surplus reserve 630,345,307.43 260,345,014.85 - 890,690,322.28
49. Unappropriated profit
Unit: RMB
Proportion of
Item Amount appropriation or
allocation
For the period from 1 January to 30 June 2021
Unappropriated profit at the beginning of period before adjustment 12,316,177,395.17
Add: Adjustment of unappropriated profit at the beginning of the
12,942,703.53
period
Including: Change in the scope of combination scope under the
12,942,703.53
same control
Unappropriated profit at the beginning of period after adjustment 12,329,120,098.70
Add: Net profit attributable to shareholders of the Company
1,677,035,346.17
for the period
Less: Appropriation to statutory surplus reserve -
Appropriation to discretionary surplus reserve -
Appropriation to general risk reserve -
Ordinary shares' dividends payable 730,498,747.12 Note
Ordinary shares' dividends converted into share capital -
Unappropriated profit at the end of the period 13,275,656,697.75
- 107 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
49. Unappropriated profit - continued
Unit: RMB
Proportion of
Item Amount appropriation or
allocation
For the year ended 31 December 2020
Unappropriated profit at the end of prior year before adjustment 11,467,166,351.85
Add: Adjustment of unappropriated profit at the beginning of the period 4,421,264.15
Including: Changes in scope of consolidation of enterprises under common control 4,421,264.15
Unappropriated profit at the beginning of the period after adjustment 11,471,587,616.00
Add: Net profit attributable to shareholders of the Company for the period 2,073,844,409.04
Pension treatment difference -73,228,871.09
Others 1,549,916.64
Less: Appropriation to statutory surplus reserve 260,345,014.85
Appropriation to discretionary surplus reserve -
Appropriation to general risk reserve -
Ordinary shares' dividends payable 884,287,957.04
Ordinary shares' dividends converted into share capital -
Unappropriated profit at the end of the period 12,329,120,098.70
Note: According to the resolution of shareholders meeting on 28 May 2021, the Company
distributed cash dividends of RMB 3.80 (inclusive of tax) for every 10 shares, totaling up
to RMB 730,498,747.12 on the basis of the total shares of 1,922,365,124 shares at the end
of 2020.
50. Operating income and operating costs
(1) Operating income and operating costs
Unit: RMB
Amount incurred Amount incurred
Item in the current period in the prior period
Income Cost Income Cost
Principal operating 7,253,456,936.53 4,084,989,279.30 5,890,745,289.59 3,633,562,724.51
Other operating 86,485,925.73 113,461,884.97 71,752,427.37 109,627,779.63
Total 7,339,942,862.26 4,198,451,164.27 5,962,497,716.96 3,743,190,504.14
(2) Revenue from contracts
Unit: RMB
Bonded logistics
Categories of contracts Ports operation Other operation Total
operation
Mainland China, Hong Kong
5,268,414,993.63 197,393,362.01 86,485,925.73 5,552,294,281.37
and Taiwan area
- Pearl River Delta 2,958,636,092.61 135,929,453.79 86,485,925.73 3,181,051,472.13
- Yangtze River Delta 445,352,534.85 - - 445,352,534.85
- Bohai Rim 29,216,911.55 61,463,908.22 - 90,680,819.77
- Other areas 1,835,209,454.62 - - 1,835,209,454.62
Other countries 1,780,044,983.01 7,603,597.88 - 1,787,648,580.89
Total 7,048,459,976.64 204,996,959.89 86,485,925.73 7,339,942,862.26
- 108 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
50. Operating income and operating costs - continued
(3) Description of performance obligations
The Group provides wharf service, bonded logistics service and other services. These
services are obligations performed over a period of time. For wharf services, as the
handling time for containers and bulk cargos is short, the management believes that it is
not necessary to recognize revenue according to the progress towards the completion of
contract and it is an appropriate method to recognize the fulfillment of performance
obligation and revenue upon the completion of the service. For bonded logistics service
and other services, the customers evenly obtains and consumes the economic benefits from
the Group's performance of contract, meanwhile the charging rules as agreed in the
contract terms usually adopt daily/month/yearly basis. During the process of rendering
services, the Group recognizes revenue using straight-line method. Part of the Group's
handling contracts are established with discount terms, i.e. the customers whose busi ness
volume reaches agreed level, are granted with preferential charge rate or discount. At the
end of the period, as the business quantity finally realized within the contract period is
uncertain, the contract consideration is subject to variable factors. The management
included this part of discount in provisions. Details are set out in Note (V) 41. The Group's
revenue contract does not have significant financing components.
(4) At the end of the period, the variable consideration of RMB 48,807,632.93 (31 December
2020: RMB 16,990,826.32) arising from sales discount is not included in the transaction
price due to the restriction requirements relating to variable considerations.
51. Taxes and levies
Unit: RMB
Amount incurred
Amount incurred
Item in the prior period
in the current period
(Restated)
Property tax 34,695,044.14 32,845,791.16
Land use tax 18,759,104.16 14,571,417.76
City construction and maintenance tax 4,645,878.43 3,120,385.92
Education surcharges and local education surcharges 3,499,847.04 2,341,221.37
Stamp duty 1,588,858.62 4,376,444.35
Others (Note) 24,482,902.09 20,317,484.39
Total 87,671,634.48 77,572,744.95
Note: Others are mainly: (1) 2 taxes, the Program of Social Integration and Contribution for the
Financing of Social Security and Tax on Services, with total amount of BRL
16,701,615.20 (equivalent to RMB 20,068,681.78) assumed by Company's subsidiary TCP
in the current period. The total amount is; and (2) the environmental protection tax of
RMB 2,939,339.36 assumed by Zhanjiang Port, a subsidiary of the company, in the
current period.
- 109 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
52. Administrative expenses
Unit: RMB
Amount incurred
Amount incurred
Item in the prior period
in the current period
(Restated)
Employee's salary 571,878,311.76 508,551,934.96
Depreciation expenses 36,293,887.29 43,742,178.23
Amortization of intangible assets 31,103,215.97 32,131,903.34
Fees paid to agencies 21,580,976.43 32,640,338.65
Others 105,513,581.92 128,655,610.27
Total 766,369,973.37 745,721,965.45
53. Financial expenses
Unit: RMB
Amount incurred
Amount incurred
Item in the prior period
in the current period
(Restated)
Interest expenses 894,059,966.10 977,499,521.99
Less: Capitalized interest expenses 43,265,921.33 29,853,904.73
Less: Interest income 183,191,011.93 142,692,352.77
Interest expenses of lease liabilities 41,716,504.99 50,320,245.21
Handling fee 8,429,111.68 8,751,569.28
Exchange differences 8,584,164.43 -25,043,006.36
Others 3,776,199.94 2,426,563.56
Total 730,109,013.88 841,408,636.18
54. Other income
Unit: RMB
Amount incurred
Amount incurred
Item in the prior period
in the current period
(Restated)
Subsidy for business development 251,275,221.00 4,764,700.00
Transferred from deferred income 21,019,719.24 19,070,751.25
Subsidy for job stabilization 13,934,992.63 837,596.90
Additional deduction of VAT 12,256,071.53 7,085,364.75
Subsidy for business operation 2,158,465.47 1,995,842.60
Refund of withholding tax 1,751,374.91 2,254,175.78
Special fund for innovation 1,674,200.00 2,520,200.00
Unemployment insurance reimbursement - 15,044,277.64
Others 1,912,213.84 2,544,257.44
Total 305,982,258.62 56,117,166.36
- 110 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
55. Investment income
(1) Details of investment income:
Unit: RMB
Amount incurred
Amount incurred
Item in the prior period
in the current period
(Restated)
Long-term equity investments income under equity method 3,557,359,417.25 1,393,872,651.34
Including: Long-term equity investments income of associated
3,462,322,244.32 1,217,778,295.61
enterprises under equity method
Including: Long-term equity investments income of joint
95,037,172.93 176,094,355.73
venture under equity method
Investment income on held-for-trading financial assets 7,908,358.90 -
Investment income on other non-current financial assets 40,188,401.29 72,554,362.03
Dividend income on other equity instruments 460,000.00 460,131.33
Interest income on debt investments 3,827,414.15 37,722,123.77
Total 3,609,743,591.59 1,504,609,268.47
There is no significant restriction on the remittance of the Group's investment income.
(2) Details of long-term equity investments income under equity method
Unit: RMB
Amount incurred
Amount incurred
Investee in the prior period Reason for changes
in the current period
(Restated)
Shanghai International Port (Group) Co., Ltd. 2,327,928,232.22 1,022,649,024.58 Changes in net profit of investee
Nanshan Group 560,718,761.21 -67,388,586.72 Changes in net profit of investee
Terminal Link SAS 182,473,114.97 108,374,645.14 Changes in net profit of investee
Shenzhen China Merchants Qianhai Industrial
108,224,200.00 12,188,400.29 Changes in net profit of investee
Development Co., Ltd.
Liaoning Port Co., Ltd. 91,600,129.01 88,081,029.71 Changes in net profit of investee
Euro-Asia Oceangate S.àr.l. 35,657,835.28 32,577,150.24 Changes in net profit of investee
Modern Terminals Limited 41,893,785.31 19,835,459.97 Changes in net profit of investee
Qingdao Qianwan United Container Terminal
30,849,525.86 51,573,423.78 Changes in net profit of investee
Co., Ltd.
Others 178,013,833.39 125,982,104.35 Changes in net profit of investee
Total 3,557,359,417.25 1,393,872,651.34
56. Gains on changes in fair value (loss is marked with "-")
Unit: RMB
Amount incurred Amount incurred
Item
in the current period in the prior period
Held-for-trading financial assets 7,839.21 -
Other non-current financial assets -45,536,366.63 -138,571,248.16
Including: Financial assets at fair value through profit or loss -45,536,366.63 -138,571,248.16
Other non-current liabilities -443,004,339.03 -157,164,405.14
Including: Financial liabilities at fair value through profit
-443,004,339.03 -157,164,405.14
or loss
Total -488,532,866.45 -295,735,653.30
- 111 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
57. Gains on impairme nt of credit (loss is marked with "-")
Unit: RMB
Amount incurred
Amount incurred
Item in the prior period
in the current period
(Restated)
I. Gains on impairment of credit of accounts receivable
-1,176,139.34 102,546.48
(loss is marked with "-")
II. Gains on impairment of credit of other receivables
-1,724,448.07 -967,713.09
(loss is marked with "-")
III. Gains on impairment of credit of long-term receivables
314,255.21 -2,718,612.10
(loss is marked with "-")
Total -2,586,332.20 -3,583,778.71
58. Gains from impairme nt of assets (loss is marked with "-")
Unit: RMB
Amount incurred Amount incurred
Item
in the current period in the prior period
Gains from decline in value of inventories - 947,693.77
Total - 947,693.77
59. Gains on disposal of assets (loss is marked with "-")
Unit: RMB
Amount included
Amount incurred Amount incurred
in non-recurring
Item in the current in the prior
profit or loss for
period period
the current period
Gains on disposal of non-current assets 9,432,717.92 560,256,383.38 9,432,717.92
Including: Gains on disposal of fixed assets
12,639,946.67 -17,221,138.93 12,639,946.67
(Losses are indicated with "-")
Gains on disposal of intangible assets -3,516,976.79 579,800,163.81 -3,516,976.79
Others 309,748.04 -2,322,641.50 309,748.04
60. Non-operating income
Unit: RMB
Amount included in
Amount incurred Amount incurred
non-recurring profit
Item in the current in the prior
or loss for the
period period
current period
Government grants 358,210.35 16,416,962.22 358,210.35
Insurance compensation received 325,396.51 3,485,302.26 325,396.51
Gains from scrapping of non-current assets 2,379,435.54 2,026,187.96 2,379,435.54
Compensation received for contracts violation 924,253.93 864,126.63 924,253.93
Exempted current accounts 1,365,449.42 - 1,365,449.42
Others 23,634,923.98 4,952,786.32 23,634,923.98
Total 28,987,669.73 27,745,365.39 28,987,669.73
- 112 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
61. Non-operating expenses
Unit: RMB
Amount included in
Amount incurred Amount incurred
non-recurring profit
Item in the current in the prior
or loss for the
period period
current period
External donations 526,437.28 433,214.18 526,437.28
Losses on retirement of non-current assets 7,080,879.70 4,646,632.04 7,080,879.70
Compensation, liquidated damages and
553,684.53 9,383,479.78 553,684.53
penalties
Litigation losses 4,265,352.56 6,107,367.67 4,265,352.56
Others 1,897,510.20 2,539,628.84 1,897,510.20
Total 14,323,864.27 23,110,322.51 14,323,864.27
62. Income tax expenses
Unit: RMB
Amount incurred Amount incurred
Item
in the current period in the prior period
Current tax expenses 596,520,712.86 643,414,033.05
Deferred tax expenses 46,917,882.26 -130,246,569.35
Total 643,438,595.12 513,167,463.70
Reconciliation of income tax expenses to the accounting profit is as follows:
Unit: RMB
Amount incurred
Item
in the current period
Accounting profit 4,907,699,839.95
Income tax expenses calculated at 25% 1,226,924,959.99
Effect of non-deductible cost, expenses and losses 123,834,019.18
Accrued income tax expenses 393,501,986.67
Effect of deductible temporary differences and deductible losses for which the deferred tax
36,963,410.99
assets are not recognized in current year
Effect of tax-free income (Note) -598,127,300.63
Effect of tax incentives and changes of tax rate -220,096,837.55
Effect of different tax rates of subsidiaries operating in other jurisdictions -264,233,040.74
Effect of utilizing deductible losses for which the deferred tax assets were not recognized
-27,840,036.94
in prior period
Effect of adjustments to prior-year income tax -30,394,194.73
Changes in the opening balance of deferred tax assets/ liabilities due to tax adjustments -
Effect of unrecognized taxable temporary difference for the purpose of tax -347,404.28
Others 3,253,033.16
Income tax expenses 643,438,595.12
Note: This mainly represents the tax effect on investment income from joint venture and
associates.
- 113 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
63. Assets with restricted ownership or use right
Unit: RMB
Item Closing balance Opening balance
Cash and bank balances (Note 1) 12,259,378.15 11,528,570.90
Equity investment in CICT (Note 2) 1,820,922,384.09 1,626,554,439.58
Equity investment in TML (Note 2) 837,308,977.18 859,148,327.98
Fixed assets (Note 3) 341,262,588.64 341,931,071.09
Intangible assets (Note 3) 215,521,701.84 218,825,477.36
Construction in progress (Note 3) 39,017,486.19 43,751,101.60
Total 3,266,292,516.09 3,101,738,988.51
Note 1: Details of restricted cash and bank balances are set out in Note (V) 1.
Note 2: Details of mortgaged equity and interests are set out in Note (V) 36.
Note 3: Yide Port mortgaged its land with property right, fixed assets and construction in progress
to obtain bank borrowings; Shenzhen Haixing Harbor Development Co., Ltd. mortgaged
its land with property right to obtain bank borrowings; Dongguan Chiwan Warf Co., Ltd.
mortgaged its sea area use right with property right to obtain bank borrowings. Details of
mortgage borrowings are set out in Note (V) 36.
64. Other comprehensive income
Details are set out in Note (V) 46.
65. Items in cash flow statement
(1) Other cash receipts relating to operating activities:
Unit: RMB
Amount incurred
Amount incurred
Item in the prior period
in the current period
(Restated)
Government grants 271,313,303.29 45,331,564.62
Interest income 75,974,603.30 89,851,546.27
Guarantees and deposits 20,852,450.76 44,309,278.23
Rentals 4,157,219.40 3,840,803.19
Insurance compensation 1,932,522.06 6,093,294.49
Harbor construction fee and service charge refund 124,986.79 161,267.76
Others 229,171,279.38 237,394,967.82
Total 603,526,364.98 426,982,722.38
- 114 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
65. Items in cash flow statement - continued
(2) Other cash payments relating to operating activities
Unit: RMB
Amount incurred
Amount incurred
Item in the prior period
in the current period
(Restated)
Advance payment 127,724,052.53 125,126,233.17
Operating expenses such as operating costs and administration
76,583,283.18 107,164,204.34
expense etc.
Guarantees and deposits 17,586,204.25 20,785,228.07
Harbour dues on cargo 6,404,202.74 -
Rentals 5,187,155.54 9,242,133.46
Port charges 4,837,252.74 2,933,172.39
Port construction fee 252,673.92 6,631,496.50
Others 169,468,219.41 101,421,481.51
Total 408,043,044.31 373,303,949.44
(3) Other cash receipts relating to investing activities
Unit: RMB
Amount incurred Amount incurred
Item
in the current period in the priorperiod
Recovery of project advance principal 179,352,864.40 363,580,000.00
Receipt of project advance interest 81,714,623.32 -
Recovery of loans 9,462,511.39 43,282,119.52
Compensation received from Zhanjiang Port in transition period - 3,803,477.07
Others 85,123,172.47 99,121,590.00
Total 355,653,171.58 509,787,186.59
(4) Other cash receipts relating to investing activities
Unit: RMB
Amount incurred Amount incurred
Item
in the current period in the priorperiod
Staff resettlement costs related to land acquisition and reserve
11,284,795.93 -
in Shantou Port
Related party borrowings - 3,009,744,121.38
Others 104.00 25,948.75
Total 11,284,899.93 3,009,770,070.13
(5) Other cash payments relating to financing activities
Amount incurred Amount incurred
Item
in the current period in the prior period
Acquisition of minority shareholders' equity by Dalian Port
8,748,637.26 -
Logistics Network Co., Ltd. ("DPN")
SINOSURE premium in CDB loans 1,748,638.84 -
Acquisition of minority shareholders' equity by CMPort - 755,986,916.38
Others 999,231.79 585,881.79
Total 11,496,507.89 756,572,798.17
- 115 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
66. Supple mentary information to the cash flow statement
(1) Supplementary information to the cash flow statement
Unit: RMB
Amount incurred Amount incurred
Supplementary information
in the current period in the prior period
1. Reconciliation of net profit to cash flows from operating
activities:
Net profit 4,264,261,244.83 1,796,694,443.47
Add: Provision for impairment losses of assets - -947,693.77
Provision for impairment losses of credit 2,586,332.20 3,583,778.71
Depreciation of fixed assets 914,300,614.45 943,286,583.19
Depreciation of investment property 94,835,428.40 94,989,539.23
Depreciation of right-of-use assets 166,527,483.26 154,716,139.25
Amortization of intangible assets 303,613,191.00 311,615,155.36
Amortization of long-term prepaid expenses 23,468,890.89 20,891,672.06
Losses (gains) on disposal of fixed assets, intangible
-9,432,717.92 -560,256,383.38
assets and other long-term assets
Losses on retirement of fixed assets, intangible assets
4,701,444.16 2,620,444.08
and other long-term assets
Losses (gains) on changes in fair value 488,532,866.45 295,735,653.30
Financial expenses 799,077,760.88 972,922,856.11
Investment loss (income) -3,609,743,591.59 -1,504,609,268.47
Decrease (increase) in deferred tax assets -69,535,313.14 -16,215,090.44
Increase (decrease) in deferred tax liabilities 116,453,195.40 -114,085,052.68
Decrease (increase) in inventories 4,815,029.15 -25,863,281.38
Decrease (increase) in operating receivables -1,125,312,552.90 -1,414,945,081.25
Increase in operating payables 565,811,102.44 1,097,606,789.69
Net cash flows from operating activities 2,934,960,407.96 2,057,741,203.08
2. Significant investing and financing activities that do not
involve cash receipts and payments:
Conversion of debt into capital - -
Convertible bonds due within one year - -
Fixed assets under finance lease - -
3. Net changes in cash and cash equivalents:
Closing balance of cash 9,347,523,070.31 7,300,058,483.14
Less: Opening balance of cash 11,898,618,327.29 7,787,660,214.80
Add: Closing balance of cash equivalents - -
Less: Opening balance of cash equivalents - -
Net increase (decrease) in cash and cash equivalents -2,551,095,256.98 -487,601,731.66
(2) Cash and cash equivalents
Unit: RMB
Item Closing balance Opening balance
I. Cash 9,347,523,070.31 11,898,618,327.29
Including: Cash on hand 363,642.53 575,797.26
Bank deposits 8,996,915,786.39 11,545,752,102.19
Other monetary funds 350,243,641.39 352,290,427.84
II. Cash equivalents - -
III. Closing balance of cash and cash equivalents 9,347,523,070.31 11,898,618,327.29
- 116 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
67. Foreign currency monetary items
Closing balance of Closing amount
Item Exchange rate
original currency in RMB
Cash and bank balances 1,057,715,232.68
Including: HKD 141,739,185.69 0.8348 118,323,872.21
USD 21,388,326.29 6.4824 138,647,686.34
EUR 71,636,730.96 7.7326 553,938,185.82
RMB 246,805,488.31 1.0000 246,805,488.31
Accounts receivable 203,201,673.27
Including: HKD 2,449,551.71 0.8348 2,044,885.77
USD 3,481,663.19 6.4824 22,569,533.46
EUR 23,095,369.48 7.7326 178,587,254.04
Other receivables 571,706,948.69
Including: HKD 91,891,940.77 0.8348 76,711,392.15
USD 4,722,413.28 6.4824 30,612,571.85
EUR 32,697,154.49 7.7326 252,834,016.81
RMB 211,548,967.88 1.0000 211,548,967.88
Other non-current assets 30,060,781.71
Including: EUR 3,887,538.70 7.7326 30,060,781.71
Short-term borrowings 995,081,600.00
Including: HKD 1,192,000,000.00 0.8348 995,081,600.00
Accounts payable 77,510,713.84
Including: HKD 4,537,349.76 0.8348 3,787,779.58
USD 31,136.44 6.4824 201,838.86
EUR 9,048,429.47 7.7326 69,967,885.72
RMB 3,553,209.68 1.0000 3,553,209.68
Other payables 323,748,828.95
Including: HKD 190,686,125.70 0.8348 159,184,777.73
USD 23,834,969.36 6.4824 154,507,805.38
EUR 1,300,499.94 7.7326 10,056,245.84
Non-current liabilities due within one year 5,759,290,903.74
Including: USD 499,122,356.96 6.4824 3,235,510,766.75
RMB 2,523,780,136.99 1.0000 2,523,780,136.99
Long-term borrowings 2,937,510,647.50
Including: USD 222,800,000.00 6.4824 1,444,278,720.00
EUR 106,462,500.00 7.7326 823,231,927.50
RMB 670,000,000.00 1.0000 670,000,000.00
Bonds payable 13,160,997,029.39
Including: USD 2,030,266,109.68 6.4824 13,160,997,029.39
Long-term payables 1,975,705.16
Including: HKD 2,366,680.83 0.8348 1,975,705.16
- 117 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
68. Governme nt grants
Unit: RMB
Amount included in
Type Amount Item Account profit or loss for
the period
Related to income 251,275,221.00 Subsidy for business development Other income 251,275,221.00
Related to income 13,934,992.63 Subsidy for job stabilization Other income 13,934,992.63
Related to income 2,158,465.47 Subsidy for business operation Other income 2,158,465.47
Related to income 1,674,200.00 Special fund for innovation Other income 1,674,200.00
Related to income 1,912,213.84 Others Other income 1,912,213.84
Non-operating
Related to income 358,210.35 Others 358,210.35
income
Total 271,313,303.29 271,313,303.29
69. Lease
Undiscounted lease receipts subsequent to the balance sheet date are as follows:
Unit: RMB
Maturity analysis of undiscounted lease receipts Closing balance
1 st year subsequent to the balance sheet date 219,249,796.09
2 nd year subsequent to the balance sheet date 136,317,870.06
3 rd year subsequent to the balance sheet date 102,450,753.00
4th year subsequent to the balance sheet date 85,838,451.42
5th year subsequent to the balance sheet date 81,548,526.40
Subsequent years 302,616,011.07
Total 928,021,408.04
Note 1: The operating leases where the Group as the lessor are related to port and terminal
facilities, machinery equipment, vehicles, land and buildings, with lease terms ranging
from 1 month to 50 years and option to renew the lease of port and terminal facilities,
machinery equipment, land and buildings. The Group considers that as the leased assets
are properly used, the unguaranteed balance of such assets does not constitutes material
risk of the Group.
Note 2: For the period from 1 January to 30 June 2021, the revenue relating to operating lease
amounts to RMB 210,384,381.50; there is no revenue relating to variable lease payment
that is not included in lease receipts.
VI. CHANGES IN SCOPE OF CONSOLIDATION
1. Business combination not involving enterprises under common control
The Group has no business combination not involving enterprises under common control in the
current period.
- 118 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
VI. CHANGES IN SCOPE OF CONSOLIDATION - continued
2. Business combination involving enterprises under common control
(1) Composition of the Group
Unit: RMB
Income of the Net profit of
combine d the combine d
Basis for Income of the Net profit of the
Proportion of party from the party from the
business Basis of combine d party combined party
Name of combined equity obtained Combination beginning of beginning of
combination combination during the during the
party in business date the current the current
under the date comparison comparison
combination (%) pe riod to the pe riod to the
same control pe riod period
combination combination
date date
Controlled by
the same
party before
and after the 9 February Transfer of
DPN 79.03 6,730,476.41 -1,670,529.39 38,453,860.40 -356,424.02
combination, 2021 actual control
and the
control is not
temporary
Controlled by
the same
party before
Yingkou Gangxin
and after the 9 February Transfer of
T echnology Co., Ltd. 100.00 - -1,585,261.11 1,546,698.08 -643,614.91
combination, 2021 actual control
("GangXinKeJi")
and the
control is not
temporary
(2) Combination cost
Unit: RMB
Combination cost DPN GangXinKeJi
Cash - -
Face value of equity securities issued 66,576,790.71 13,918,166.22
Total combination costs 66,576,790.71 13,918,166.22
(3) Book value of assets and liabilities of the combined party on the combination date
Unit: RMB
DPN GangXinKeJi
Item Combination Opening Combination Opening
date balance date balance
Assets:
Current assets 131,465,942.76 140,838,127.92 18,138,156.41 18,319,351.22
Long term equity investment 10,246,299.45 10,487,799.45 - -
Fixed assets 8,102,180.97 8,136,170.96 34,046.16 35,363.69
Right-of-use assets 517,511.87 526,095.34 - -
Intangible assets 5,994,866.71 6,088,378.29 - -
Long term deferred expenses 131,052.72 157,263.23 - -
Deferred tax assets 126,018.46 126,018.46 - -
Liabilities:
Current liabilities 84,299,499.68 56,894,215.88 2,096,139.03 2,410,894.10
Deferred income 278,444.67 293,140.09 - -
Lease liabilities 444,186.06 427,236.03 - -
Net assets 71,561,742.53 108,745,261.65 16,076,063.54 15,943,820.81
Less: Minority interests - 20,332,141.71 - -
Net assets acquired 71,561,742.53 88,413,119.94 16,076,063.54 15,943,820.81
3. Reverse purchase
The Group has no reverse purchase in the current period.
- 119 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
VI. CHANGES IN SCOPE OF CONSOLIDATION - continued
4. Disposal of subsidiary
There is no loss of control over the disposal of subsidiary investment in the Group in the
current period.
5. Scope of consolidation change for other reasons
The Group has no scope of consolidation change for other reasons in the current period.
VII. EQUITY IN OTHER ENTITIES
1. Interests in subsidiaries
(1) Composition of the Group
Proportion of
Registered capital
Principal place ownership
Name of the subsidiary Place of incorporation Nature of business (RMB'0000, unless Acquisition method
of business interest (%)
otherwise specified)
Direct Indirect
Shenzhen Chiwan International Freight Investment establishment
Shenzhen, PRC Shenzhen, PRC Logistics support services 550 100.00 -
Agency Co., Ltd.
Chiwan Wharf (Hong Kong) Co., Ltd. Investment establishment
Hong Kong, PRC Hong Kong, PRC Investment holding HKD1,000,000 100.00 -
("Chiwan Wharf (Hong Kong) ")
Dongguan Chiwan Warf Co., Ltd. Dongguan, PRC Dongguan, PRC Logistics support services 45,000.00 85.00 - Investment establishment
Dongguan Chiwan Terminal Co., Ltd. Dongguan, PRC Dongguan, PRC Logistics support services 40,000.00 100.00 - Investment establishment
Business combination
Shenzhen Chiwan Harbor Container Co. Ltd. Shenzhen, PRC Shenzhen, PRC Logistics support services 28,820.00 100.00 - involving enterprises under
common control
Business combination
Shenzhen Chiwan Port Development Co.,
Shenzhen, PRC Shenzhen, PRC Logistics support services 1,500.00 100.00 - involving enterprises under
Ltd.
common control
Business combination
Chiwan Container Terminal Co., Ltd. Shenzhen, PRC Shenzhen, PRC Logistics support services USD95,300,000 55.00 20.00 involving enterprises under
common control
Business combination
Shenzhen Chiwan Tugboat Co., Ltd. Shenzhen, PRC Shenzhen, PRC Logistics support services 2,400.00 100.00 - involving enterprises under
common control
Business combination
Chiwan Shipping (Hong Kong) Limited Hong Kong, PRC Hong Kong, PRC Logistics support services HKD800,000 100.00 - involving enterprises under
common control
China Merchants Port (Zhoushan) RoRo Assets acquisition
PRC PRC Logistics support services 17,307.86 51.00 -
Logistics Co., Ltd
Business combination
HKD
CMPort Hong Kong, PRC Hong Kong, PRC Investment holding 41.85 involving enterprises under
42,521,339,900.00
common control
Business combination
China Merchants Container Services Limited Hong Kong Hong Kong Logistics support services HKD500,000 - 100.00 involving enterprises under
common control
Business combination
China Merchants International (China)
PRC PRC Investment holding USD30,000,000 - 100.00 involving enterprises under
Investment Co., Ltd.
common control
Business combination
Qingdao Port Merchants International
PRC PRC Logistics support services USD206,300,000 - 100.00 involving enterprises under
Container Terminal Co., Ltd.
common control
Business combination
China Merchants International Terminal
PRC PRC Logistics support services USD44,000,000 - 90.10 involving enterprises under
(Qingdao) Co., Ltd.
common control
Business combination
China Merchants Bonded Logistics Co., Ltd. PRC PRC Logistics support services 70,000.00 40.00 60.00 involving enterprises under
common control
Business combination
China Merchants Port Services (Shenzhen)
PRC PRC Logistics support services 55,000.00 - 100.00 involving enterprises under
Co., Ltd.
common control
Business combination
Shekou Container Terminals Ltd. PRC PRC Logistics support services HKD618,201,200 - 100.00 involving enterprises under
common control
Business combination
Shenzhen Lianyunjie Container Terminals
PRC PRC Logistics support services 60,854.90 - 100.00 involving enterprises under
Co., Ltd
common control
Business combination
Anxunjie Container Terminals (Shenzhen)
PRC PRC Logistics support services 127,600.00 - 100.00 involving enterprises under
Co., Ltd.
common control
- 120 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
VII. EQUITY IN OTHER ENTITIES - continued
1. Interests in subsidiaries - continued
(1) Composition of the Group - continued
Proportion of
Registered capital
Principal place ownership
Name of the subsidiary Place of incorporation Nature of business (RMB'0000, unless Acquisition method
of business interest (%)
otherwise specified) Direct Indirect
Business combination
Shenzhen Haiqin Engineering Management Engineering supervision
PRC PRC 300.00 - 100.00 involving enterprises under
Co., Ltd services common control
Business combination
Shenzhen Haixing Harbor Development
PRC PRC Logistics support services 53,072.92 - 67.00 involving enterprises under
Co., Ltd
common control
Business combination
Magang Cangma PRC PRC Logistics support services 33,500.00 - 100.00 involving enterprises under
common control
Business combination
Shenzhen Mawan Ganghang Co., Ltd. PRC PRC Logistics support services 20,000.00 - 100.00 involving enterprises under
common control
Business combination
Shenzhen Zhongzhi Investment Co., Ltd. PRC PRC Investment consulting 4,000.00 - 75.00 involving enterprises under
common control
Business combination
Shenzhen Haixing Logistics Development
PRC PRC Logistics support services 7,066.79 - 67.00 involving enterprises under
Co., Ltd. common control
Business combination
Shenzhen Lianyongtong Terminal Co., Ltd. PRC PRC Logistics support services USD7,000,000 - 100.00 involving enterprises under
common control
Business combination
Shenzhen Lianda Tugboat Co., Ltd. PRC PRC Logistics support services 200.00 - 60.29 involving enterprises under
common control
Business combination
Zhangzhou Zhongli Outer Wheel Tally
PRC PRC Logistics support services 200.00 - 84.00 involving enterprises under
Co., Ltd.
common control
Business combination
Xiamenwan Port Affairs (note 2) PRC PRC Logistics support services 44,450.00 - 31.00 involving enterprises under
common control
Business combination
Zhangzhou China Merchants Port Co., Ltd. PRC PRC Logistics support services 100,000.00 - 60.00 involving enterprises under
common control
Business combination
Zhangzhou China Merchants Tugboat
PRC PRC Logistics support services 1,500.00 - 100.00 involving enterprises under
Company Limited
common control
Business combination
China Merchants International Technology PRC PRC IT services 8,784.82 13.18 43.74 involving enterprises under
Company Limited ("CMIT") common control
Business combination
DPN (Note 3) PRC PRC IT services 3,200.00 - 79.03 involving enterprises under
common control
Business combination
Yingkou Gangxin (Note 3) PRC PRC IT services 800.00 - 100.00 involving enterprises under
common control
Business combination
Preparation for warehousing
ATJ PRC PRC HKD100,000,000 - 100.00 involving enterprises under
projects common control
Business combination
Preparation for warehousing
ASJ PRC PRC HKD100,000,000 - 100.00 involving enterprises under
projects
common control
Business combination
Anyunjie Port Warehousing Service Preparation for warehousing
PRC PRC 6,060.00 - 100.00 involving enterprises under
(Shenzhen) Co., Ltd. projects common control
Business combination
Yide Port PRC PRC Logistics support services 21,600.00 - 51.00 involving enterprises under
common control
Business combination
British Virgin
Mega Shekou Container Terminals Limited British Virgin Islands Investment holding USD120.00 - 80.00 involving enterprises under
Islands
common control
Business combination
TML Cyprus Cyprus Investment holding EUR5,000.00 - 100.00 involving enterprises under
common control
Business combination
CICT Sri Lanka Sri Lanka Logistics support services USD150,000,100 - 85.00 involving enterprises under
common control
Business combination
Government of Government of
Lome Container Terminal S.A. Logistics support services FCFA200,000,000 - 100.00 involving enterprises under
Republic of Togo Republic of Togo common control
Business combination
British Virgin
Gainpro British Virgin Islands Investment holding USD1.00 - 76.47 involving enterprises under
Islands
common control
Business combination
Shenzhen Jinyu Rongtai Investment
PRC PRC Lease of property etc. 80,000.00 - 100.00 involving enterprises under
Development Co., Ltd.
common control
Business combination
Shenzhen Merchants Qianhaiwan Real
PRC PRC Lease of property etc. 20,000.00 - 100.00 involving enterprises under
Estate Co., Ltd. common control
- 121 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
VII. EQUITY IN OTHER ENTITIES - continued
1. Interests in subsidiaries - continued
(1) Composition of the Group - continued
Proportion of
Registered capital
Principal place ownership
Name of the subsidiary Place of incorporation Nature of business (RMB'0000, unless Acquisition method
of business interest (%)
otherwise specified) Direct Indirect
Business combination
Shantou Port PRC PRC Logistics support services 12,500.00 - 60.00 involving enterprises under
common control
Business combination
Hambantota International Port Group
Sri Lanka Sri Lanka Logistics support services USD794,000,000 - 85.00 involving enterprises under
(Private) Limited
common control
Business combination
China Merchants Holdings (Djibouti) FZE Djibouti Djibouti Logistics support services USD38,140,000 - 100.00 involving enterprises under
common control
Business combination
British Virgin
Xinda Resources Limited ("Xinda") British Virgin Islands Investment holding USD107,620,000 - 77.45 involving enterprises under
Islands
common control
Business combination
Kong Rise Development Limited Hong Kong, PRC Hong Kong, PRC Investment holding USD107,620,000 - 100.00 involving enterprises under
common control
Business combination not
TCP Brazil Brazil Logistics support services BRL68,851,600 - 100.00 involving enterprises under
common control
Business combination not
Zhanjiang Port PRC PRC Logistics support services 587,420.91 30.78 27.58 involving enterprises under
common control
Business combination not
Zhanjiang Port International Container
PRC PRC Logistics support services 60,000.00 - 80.00 involving enterprises under
Terminal Co., Ltd
common control
Business combination not
Zhanjiang Port Petrochemical Terminal PRC PRC Logistics support services 18,000.00 - 50.00 involving enterprises under
Co., Ltd. common control
Business combination not
China Ocean Shipping Tally Co., Ltd.,
PRC PRC Logistics support services 300.00 - 84.00 involving enterprises under
Zhanjiang
common control
Business combination not
Zhanjiang Port Donghaidao Bulk Cargo
PRC PRC Logistics support services 5,000.00 - 100.00 involving enterprises under
Terminal Co., Ltd. common control
Business combination not
Zhanjiang Port Bonded Service Co., Ltd., PRC PRC Logistics support services 300.00 100.00 involving enterprises under
Guangdong common control
Business combination not
Guangdong Zhanjiang Port Logistics
Shantou, PRC Shantou, PRC Logistics support services 10,000.00 100.00 involving enterprises under
Co., Ltd.
common control
Business combination not
Zhanjiang Port Haichuan Trading Co., Ltd. Hong Kong, PRC Hong Kong, PRC Logistics support services 200.00 100.00 involving enterprises under
common control
Business combination not
Ningbo Daxie PRC PRC Logistics support services 1,20,909.00 - 45.00 involving enterprises under
common control
Shantou Seaport Tugboat Service Co. LTD PRC PRC Logistics support services 1,000.00 - 100.00 Investment establishment
Business combination not
Guangdong Zhanjiang Port Longteng
PRC PRC Logistics support services 9,000.00 - 70.00 involving enterprises under
Shipping Co. LTD common control
Note 1: On 19 June 2018, the Company and China Merchants Group (Hong Kong) Co., Ltd.
("CMHK") entered into "Agreement of Concerted Action on China Merchants Port
Holdings Company Limited". According to the agreement, CMHK unconditionally keeps
consistent with the Company when voting for the matters discussed at the general
shareholders meeting of CMPort in respect of its voting power of CMPort as entrusted,
and performs the voting as per the Company's opinion.
In July and October 2020, CMPort respectively distributed 2019 dividends and 2020
interim dividends to shareholders. The shareholders may select to receive all dividends in
cash, all dividends in lieu of shares, or part cash and part new shares. The Company select
to receive all its share of dividends from the shareholding in CMPort in the form of scrip
dividends. Upon the completion of above distribution of CMPort, the Company's share in
CMPort increased from 1,411,014,033 shares to 1,532,248,957 shares, accounting for
41.85% (previously 40.91%) of the total issued shares of CMPort. The proportion of
shares held by CMHK changed from 21.86% to 22.36%. Therefore, the Company has total
64.21% voting power of CMPort and has control over CMPort.
- 122 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
VII. EQUITY IN OTHER ENTITIES - continued
1. Interests in subsidiaries - continued
(1) Composition of the Group - continued
Note 2: The Group and China Merchants Zhangzhou Development Zone Co., Ltd. entered into
"Equity Custody Agreement", according to which China Merchants Zhangzhou
Development Zone Co., Ltd. entrusted its 29% equity of ZCMG to the Group for operation
and management. Therefore, the Group has 60% voting power of ZCMG and includes it in
the scope of consolidated financial statements.
Note 3: On 18 December 2020, The Company has signed the Agreement on Equity Subscription
and Capital Increase with the company's subsidiaries, China Merchants Bureau Port,
CMIT, Centralized Logistics, Dagang Jike and Yingkou Port Group Co., LTD.
(hereinafter referred to as "Yingkou Port Group"). Pursuant to the Equity Subscription and
Capital Increase Agreement, Centralized Logistics and Dalian Port Container increased the
capital of China Merchants International Information with their 29.40% and 49.63%
shares of DPN respectively, and Yingkou Port Group increased the capital of CMIT with
their 100% shares of Gangxin Technology. Before and after the merger, CMIT, DPN and
Gangxin Technology are finally controlled by China Merchants Group, the actual
controller of the Company, and the control is not temporary. The above capital increase
was completed on 9 February 2021. After the capital increase, the Company, China
Merchants Port, Centralized Logistics, Dalian Port Container and Yingkou Port Group will
hold 13.18%, 43.74%, 13.26%, 22.38% and 7.44% of the equity of CMIT respectively.
CMIT is still the holding subsidiary of the Company. CMIT holds 79.03% of the equity of
DPN and 100% of the equity of Gangxin Technology respectively, having control over
DPN and Gangxin Technology. Therefore, from 9 February 2021, the Company
incorporated DPN and Gangxin Technology into the consolidation scope of the
Company's consolidated financial statements with reference to the accounting treatment
method of business combination under the same control from the commencement of the
comparative financial statements.
(2) Material non-wholly-owned subsidiaries
Unit: RMB
Profit or loss Dividends
Proportion of
attributable to distributed to Balance of
ownership
minority minority minority interests
Name of the subsidiary interest held by
shareholders in shareholders in at the end of the
the minority
the current the current period
shareholders (%)
period period
CMPort 58.15 2,476,386,276.83 37,396,166.19 64,514,311,015.53
- 123 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
VII. EQUITY IN OTHER ENTITIES - continued
1. Interests in subsidiaries - continued
(3) Significant financial information of material non-wholly-owned subsidiaries
Unit: RMB
Closing balance Opening balance
Name of the
Non-current Current Non-current
subsidiary Current assets Non-current assets Total assets Current liabilities Total liabilities Current assets Non-current assets Total assets Total liabilities
liabilities liabilities liabilities
CMPort 13,768,207,634.06 126,273,716,131.40 140,041,923,765.46 16,191,755,983.64 28,652,722,348.85 44,844,478,332.49 14,625,774,694.50 125,425,081,030.94 140,050,855,725.44 13,055,907,214.63 34,087,468,137.34 47,143,375,351.97
Unit: RMB
Amount incurred Amount incurred
in the current period in the prior period
Name of the
Total Total
subsidi ary Cash flows from Cash flows from
Operating income Net profit comprehensive Operating income Net profit comprehensive
operating acti vi ties operating acti vi ties
income income
CMPort 4,722,661,879.99 3,924,079,558.91 3,595,625,905.94 2,188,410,312.61 3,692,963,958.88 1,592,920,984.37 515,475,406.96 1,499,234,240.53
2. Transactions resulting in changes in ownership interests in subsidiaries without losing control over the subsidiaries
(1) Description of changes in ownership interests in subsidiaries
See Note VII 1 (1) for details.
- 124 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
VII. EQUITY IN OTHER ENTITIES - continued
2. Transactions resulting in changes in ownership interests in subsidiaries without
losing control over the subsidiaries - continued
(2) Effect of transaction on minority interests and owner's equity attributable to the parent
company
Unit: RMB
ITEM CMIT
Purchase cost
- Cash -
- Non-cash assets 21,722,727.15
Total purchase cost 21,722,727.15
Less: Share of net assets of subsidiaries calculated according to the proportion of
22,868,105.53
equity acquired
Difference 1,145,378.38
Including: Adjusted capital reserve -1,145,378.38
Adjusted surplus reserve -
Adjusted undistributed profit -
3. Interests in joint ventures and associates
(1) Material joint ventures or associates
Unit: RMB
Proporti on of ownershi p
Accounting method
Principal pl ace Place of interests held by the Group
Investee Nature of business of i nvestments in
of business registration (% )
associates
Direct Indirect
Associates
Shanghai International Port Shanghai, Port and container
Shanghai, PRC - 26.77 Equity method
(Group) Co., Ltd. PRC terminal business
- 125 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
VII. EQUITY IN OTHER ENTITIES - continued
4. Key financial information of material associates
Unit: RMB
Shanghai International Port (Group) Co., Ltd.
Closing balance /Amount Opening balance /Amount
Item
incurred in the current incurred in the prior
period period
Current assets 50,383,167,725.32 43,653,716,114.59
Including: Cash and cash equivalents 27,069,666,009.09 20,689,734,592.59
Non-current assets 115,544,815,823.74 112,271,033,861.93
Total assets 165,927,983,549.06 155,924,749,976.52
Current liabilities 28,832,997,784.13 22,405,787,626.17
Non-current liabilities 35,421,996,922.32 37,539,362,699.55
Total liabilities 64,254,994,706.45 59,945,150,325.72
Minority interests 8,617,160,541.88 8,461,734,212.94
Equity attributable to shareholders of the parent company 93,055,828,300.73 87,517,865,437.86
Share of net assets calculated based on the proportion of
ownership interests
24,911,045,236.11 23,428,532,577.72
Adjustments - -
-Goodwill 2,076,585,747.12 2,076,585,747.12
-Others -149,563,344.83 -143,335,143.43
Carrying amounts of equity investments in associates 26,838,067,638.40 25,361,783,181.41
Fair value of publicly quoted equity investments in
associates 29,586,221,627.22 28,345,709,190.02
Operating income 17,362,678,537.04 12,038,672,650.45
Net profit 9,168,282,128.06 4,328,854,036.44
Other comprehensive income -8,803,490.60 195,337,471.93
Total comprehensive income 9,159,478,637.46 4,524,191,508.37
Dividends received from associates in the current year 793,927,959.22 899,371,516.97
5. Summarized financial information of immaterial associates and joint ventures
Unit: RMB
Closing balance / Opening balance/ Amount
Amount incurred incurred
in the current in the prior
period period
Joint ventures:
Total carrying amount of investments 8,855,932,238.43 8,866,327,205.84
Aggregate of following items calculated based on the
- -
proportion of ownership interest
- Net profit 95,037,172.93 177,436,875.24
- Other comprehensive income - -
- Total comprehensive income 95,037,172.93 177,436,875.24
Associates:
Total carrying amount of investments 31,735,276,355.12 32,014,300,835.65
Aggregate of following items calculated based on the
- -
proportion of ownership interest
- Net profit 1,134,394,012.10 194,518,871.83
- Other comprehensive income -53,669,400.39 -23,400,026.46
- Total comprehensive income 1,080,724,611.71 171,118,845.37
6. The investees where the Group holds long-term equity investments are not restricted
to transfer funds to the Group.
- 126 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
VIII. RISKS ASSOCIATED WITH FINANCIAL INSTRUMENTS
The Group's major financial instruments include cash and bank balances, notes receivable,
account receivables, other receivables, long-term receivables, other equity instrument investments,
other non-current financial assets, short-term borrowings, notes payable, accounts payable, other
payables, long-term borrowings, bonds payable, long-term payables etc. Details of these financial
instruments are disclosed in Notes (V). The risks associated with these financial instruments and
the policies on how to mitigate these risks are set out below. Management manages and monitors
these exposures to ensure the risks are monitored at a certain level.
The Group adopts sensitivity analysis techniques to analyze how the entity's profit or loss and for
the period and shareholders' equity would have been affected by changes in the relevant risk
variables that were reasonably possible. As it is unlikely that risk variables will change in an
isolated manner, and the interdependence between risk variables will have significant effect on
the amount ultimately influenced by the changes in a single risk variable, the followi ng items are
based on the assumption that each risk variable has changes on a stand-alone basis.
1. Risk management objectives and policies
The Group's risk management objectives are to achieve proper balance between risks and yield,
minimize the adverse impacts of risks on the Group's operation performance, and maximize the
benefits of the shareholders and other equity investors. Based on these risk management
objectives, the Group's basic risk management strategy is to identify and analyze the industry' s
exposure to various risks, establish appropriate bottom line for risk tolerance, implement risk
management, and monitors these exposures to ensure the risks are monitored at a certain level.
1.1 Market risk
1.1.1 Currency risk
Currency risk is the risk that losses will occur because of changes in foreign exchange rates. The
Group's exposure to the currency risk is primarily associated with HKD, USD and EUR. Except
for part of the purchases and sales, the Group's other principal activities are denomi nated and
settled in RMB. As at 30 June 2021, the balance of the Group's assets and liabilities are both
denominated in functional currency, except that the assets and liabilities set out below are
recorded using foreign currency. Currency risk arising fro m the foreign currency balance of assets
and liabilities may have impact on the Group's performance.
Unit: RMB
Item Closing balance Opening balance
Cash and bank balances 430,937,716.00 1,214,901,554.08
Accounts receivable 24,614,419.21 34,261,643.29
Other receivables 512,277,923.68 1,004,843,484.23
Short-term borrowings 995,081,600.00 668,320,000.00
Accounts payable 7,542,828.12 4,286,809.14
Other payables 133,239,925.15 201,395,071.52
Non-current liabilities due within one year 2,523,780,136.99 382,131,909.25
Long-term borrowings 670,000,000.00 670,000,000.00
Bonds payable - 2,500,000,000.00
Long-term payables 1,975,705.16 440,659,667.97
- 127 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
VIII. RISKS ASSOCIATED WITH FINANCIAL INSTRUMENTS - continued
1. Risk management objectives and policies - continued
1.1 Market risk - continued
1.1.1 Currency risk - continued
The Group closely monitors the effects of changes in the foreign exchange rates on the Group's
currency risk exposures. According to the current risk exposure and judgment of the exchange
rate movements, management considers it is unlikely that the exchange rate changes in the future
one year will result in significant loss to the Group.
Sensitivity analysis on currency risk
The assumption for the sensitivity analysis on currency risk is that all the cash flow hedges and
hedges of a net investment in a foreign operation are highly effective. On the basis of the above
assumption, where all other variables are held constant, the reasonably possible changes in the
foreign exchange rate may have the following pre-tax effect on the profit or loss for the period
and shareholders' equity:
Unit: RMB
The current period The prior period
Effect on
Item Changes in exchange rate Effect on Effect on
sharehol ders' Effect on profits
profi ts sharehol ders' equity
equity
All foreign currencies 5% increase against RMB -37,283,559.46 -37,283,559.46 -21,788,739.77 -21,788,739.77
All foreign currencies 5% decrease against RMB 37,283,559.46 37,283,559.46 21,788,739.77 21,788,739.77
All foreign currencies 5% increase against USD 1,204,140.69 1,204,140.69 1,832,900.68 1,832,900.68
All foreign currencies 5% decrease against USD -1,204,140.69 -1,204,140.69 -1,832,900.68 -1,832,900.68
All foreign currencies 5% increase against HKD -161,772,050.17 -161,772,050.17 -247,590,042.34 -247,590,042.34
All foreign currencies 5% decrease against HKD -161,772,050.17 -161,772,050.17 247,590,042.34 247,590,042.34
All foreign currencies 5% increase against FCFA 29,661,962.11 29,661,962.11 -59,525,285.86 -59,525,285.86
All foreign currencies 5% decrease against FCFA -29,661,962.11 -29,661,962.11 59,525,285.86 59,525,285.86
1.1.2 Interest rate risk - changes in cash flows
Risk of changes in cash flows of financial instruments arising from interest rate changes is mainly
related to bank loans with floating interest rate. (See Note (V) 26 and Note (V) 36). The Group
continuously and closely monitors the impact of interest rate changes on the Group's inter est rate
risk. The Group's policy is to maintain these borrowings at floating rates. Presently, the Group has
no arrangement such as interest rate swaps etc.
- 128 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
VIII. RISKS ASSOCIATED WITH FINANCIAL INSTRUMENTS - continued
1. Risk management objectives and policies - continued
1.1 Market risk - continued
1.1.2 Interest rate risk - changes in cash flows - continued
Sensitivity analysis of interest rate risk
Sensitivity analysis of interest rate risk is based on the following assumptions:
Fluctuations of market interest rate can affect the interest income or expense of a financial
instrument with floating interest rate;
For a financial instrument at fair value with fixed interest rate, the fluctuations of market interest
rate can only affect its interest income or expense;
For a derivative financial instrument designated as hedging instrument, the fluctuations of market
interest rate affects its fair value, and all interest rate hedging are expected to be highly effective;
The changes in fair value of derivative financial instruments and other financial assets and
liabilities are calculated using cash flow discounting method by applying the market interest rate at
balance sheet date.
On the basis of above assumptions, where the other variables held constant, the pre-tax effect of
possible and reasonable changes in interest rate on the profit or loss for the period and
shareholders' equity are as follows:
Unit: RMB
The current period The prior period
Changes in
Item interest rate Effect on profits
Effect on
Effect on profits
Effect on
sharehol ders' equity sharehol ders' equity
Short-term borro wings
and long-term 1% increase -103,396,518.44 -103,396,518.44 -145,999,335.58 -145,999,335.58
borrowings
Short-term borro wings
and long-term 1% decrease 103,396,518.44 103,396,518.44 145,999,335.58 145,999,335.58
borrowings
1.1.3 Other price risk
The Group's price risk is mainly arising from held-for-trading equity instrument investments and
other equity instrument investments. The Group reduces the price risk of equity instrument
investments by holding portfolio of multiple equity securities.
1.2 Credit risk
As at 30 June 2021, 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 and financial
guarantees issued by the Group is arising from the carrying amount of the respective financial
assets recognized in the consolidated balance sheet. For financial instruments measured at fair
value, the carrying amount reflects the exposure to risks but not the maximum exposure to risks;
the maximum exposure to risks would vary according to the future changes in fair value.
- 129 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
VIII. RISKS ASSOCIATED WITH FINANCIAL INSTRUMENTS - continued
1. Risk management objectives and policies - continued
1.2 Credit risk - continued
In order to minimize the credit risk, the Group has delegated a team responsible for determination
of credit limits, credit approvals and other monitoring procedures to ensure that follow-up action
is taken to recover overdue debts. In addition, the Group reviews the recoverable amount of
financial assets at each balance sheet date to ensure that adequate impairment losses are made for
irrecoverable amounts. In this regard, the manage ment of the Group considers that the Group's
credit risk is significantly reduced.
The credit risk on liquid funds is limited because they are deposited with banks with high credit
ratings.
The Group has adopted a policy to ensure that all sales customers have good credit records.
The Group's risk exposure spreads over a number of counterparties and customers, therefore the
Group has no significant concentration of credit risk. At 30 June 2021, the balance of accounts
receivable from top five entities is RMB 460,789,341.84 (31 December 2020:
RMB 446,519,920.68), accounting for 23.88% (31 December 2020: 30.40%) of the Group's
accounts receivable. In addition, the Group has no other significant credit risk exposure
concentrated on single financial asset or portfolio of financial assets with similar characteristics.
1.3 Liquidity risk
In the management of the liquidity risk, the Group monitors and maintains a level of cash and
cash equivalents deemed adequate by the management to finance the Group's operations and
mitigate the effects of fluctuations in cash flows. The management monitors the utilization of
bank borrowings and ensures compliance with loan covenants.
For the period from 1 January to 30 June 2021, the Group had total current liabilities in excess of
total current assets of RMB 4,988,808,531.03. As at 30 June 2021, the Group has available
unutilized loan facility of RMB 44,924,971,453.51which is more than current liabilities.
Therefore, the Group's management believes that the Group has no significant liquidity risk.
The following is the maturity analysis for financial assets and financial liabilities held by the
Group which is based on undiscounted remaining contractual obligations:
Unit: RMB
Item Carrying amount Gross amount Within 1 year 1 to 5 years Over 5 years
Short-term borro wings 4,918,709,603.87 4,962,866,633.77 4,962,866,633.77 - -
Notes payable 10,456,401.57 10,456,401.57 10,456,401.57 - -
Accounts payable 745,241,136.72 745,241,136.72 745,241,136.72 - -
Other payables 3,866,179,811.31 3,866,179,811.31 3,866,179,811.31 - -
Non-current liabilities due
8,743,691,405.73 8,937,632,106.24 8,937,632,106.24 - -
within one year
Other current liabilities 2,165,517,831.24 2,182,300,365.49 2,182,300,365.49 - -
Long-term borrowings 7,334,778,282.88 8,305,161,723.96 - 6,424,712,248.76 1,880,449,475.20
Bonds payable 17,283,407,358.74 17,369,182,093.23 - 13,496,709,846.86 3,872,472,246.37
Lease liabilities 1,222,109,735.26 1,909,998,378.59 - 668,177,905.72 1,241,820,472.87
Long-term payables 1,177,539,049.89 1,274,621,660.09 - 26,880,639.26 1,247,741,020.83
Other non-current liabilit ies 3,364,055,291.80 3,364,055,291.80 - 258,175,401.59 3,105,879,890.21
- 130 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
IX. DISCLOSURE OF FAIR VALUE
1. Closing balance of assets and liabilities measured at fair value
Unit: RMB
Fair value at closing balance
Item
Level 1 Level 2 Level 3 Total
Measurements at fair value
continuously
Held-for-trading financial assets 173,287.80 1,000,000,000.00 - 1,000,173,287.80
Accounts receivable financing - 272,889,319.83 - 272,889,319.83
Other equity instrument investments 11,336,800.00 - 170,680,257.74 182,017,057.74
Other non-current financial assets 839,486,772.90 - 24,422,312.79 863,909,085.69
Total assets measured at fair value
850,996,860.70 1,272,889,319.83 195,102,570.53 2,318,988,751.06
continuously
Other non-current liabilities - - 3,438,158,858.69 3,438,158,858.69
Total liabilities measured at fair value
- - 3,438,158,858.69 3,438,158,858.69
continuously
2. Basis for determining the market price of items continuously measured at level 1 fair
value
The market prices of held-for-trading financial assets, other equity instrument investments and
other non-current financial assets are determined at the closing price of the equity instrument at
Shanghai Stock Exchange and Hong Kong Stock Exchange at 30 June 2021.
3. Qualitative and quantitative information of valuation techniques and key parameters
adopted for items continuously measured at level 2 fair value
Unit: RMB
Fair value at the end of
Item Valuation techniques Inputs
the period
Accounts receivable financing 272,889,319.83 Cash flow discounting Discount rate
Held-for-trading financial assets 1,000,000,000.00 Cash flow discounting Discount rate
During the valuation, the Group needs to make estimates in respect of market volatility and
relevance etc., select appropriate discount rate and take into consideration of adjustment of
discount and premium.
4. Qualitative and quantitative information of valuation techniques and key parameters
adopted for items continuously measured at level 3 fair value
Unit: RMB
Fair value at the end of
Item Valuation techniques Inputs
the period
Other equity instrument investments 170,680,257.74 Net worth method Carrying amount
Other non-current financial assets 2,000,000.00 Cash flow discounting Discount rate
Other non-current financial assets 667,822.80 Net worth method Carrying amount
Listed company comparison
Other non-current financial assets 21,754,489.99 Share price
approach
Other non-current liabilities 3,438,158,858.69 Cash flow discounting Discount rate
- 131 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
IX. DISCLOSURE OF FAIR VALUE - continued
4. Qualitative and quantitative information of valuation techniques and key parameters
adopted for items continuously measured at level 3 fair value - continued
The fair value of non-listed equity instruments included in equity instruments at fair value through
profit or loss or other comprehensive income is determined using the valuation techniques such as
cash flow discounting method, net worth method, listed company comparison approach etc.
During the valuation, the Group needs to make estimates in respect of the future cash flows, credit
risk, market volatility and relevance etc., select appropriate discount rate and take into
consideration of adjustment of discount and premium.
5. Fair value of financial assets and financial liabilities not measured at fair value
The financial assets and liabilities not measured at fair value mainly include: notes receivable,
accounts receivable, other receivables, short-term borrowings, notes payable, accounts payable,
other payables, long-term borrowings, bonds payable and long-term payables etc.
The Group's management believes that the carrying amounts of financial assets and financial
liabilities at amortized cost in the financial statements approximate their fair values.
The fair value of bonds payable traded in active market is determined at the quoted price in the
active market. The fair values of long-term borrowings, long-term payables and bonds payable
not traded in active market are determined at the present value of contractual future cash flows
discounted using the interest rate for providing nearly the same cash flows to entity with
comparable credit rating under the same conditions.
X. RELATED PARTY RELATIONSHIPS AND TRANSACTIONS
1. Parent of the Company
Proportion of the
Proportion of the
Company's
Related party Type of the Place of Nature of Company's voting
Name of the parent Director Issued share capital ownership
relationship entity registration business power held by the
interests held by
parent (%)
the parent (%)
Private limited
Broadford Global Parent Hong Investment
company (share Li Jianhui、Sun Ligan HKD 21,120,986,262 2.88 81.92 （Note )
Limited company Kong holding
limited)
Note: Broadford Global Limited directly holds 2.88% equity of the Company, and indirectly
holds 19.29% and 59.75% equity of the Company through the subsidiaries China
Merchants Gangtong Development (Shenzhen) Co., Ltd. and China Merchants Port
Investment and Development Co., LTD. (formerly known as China Merchants Investment
and Development Co., LTD.) respectively.
The ultimate controlling shareholder of the Company is China Merchants Group.
2. Subsidiaries of the Company
Details of the subsidiaries of the Company are set out in Note (VII) 1.
- 132 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
X. RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
3. Associates and joint ventures of the Company
Details of the Company's significant joint ventures and associates are set out in Note (VII) 3.
Other joint ventures or joint ventures that occurred related party transactions and formed balances
with the Group this year are as follows:
Name of joint venture or associate Relationship with the Company
Port of Newcastle and its subsidiaries Joint venture
Guizhou East Land Port Operation Co., Ltd. Joint venture
Qingdao Qianwan West Port United Wharf Co., Ltd. Joint venture
Qingdao Qianwan New United Container Terminal Co., Ltd. Joint venture
China Merchants Antong Logistics Management Co., LTD Joint venture
China Zhanjiang ocean Shipping Agency Co. LTD Joint venture
Yantai Port Group Laizhou Port Co. LTD Joint venture
Zhanjiang Cosco Shipping Logistics Co. LTD Joint venture
Qingdao Qianwan United Container Terminal Co. LTD Joint venture
Great Horn Development Company FZCO Associate
International Djibouti Industrial Parks Operation FZCO Associate
Port De Djibouti S.A. Associate
Terminal Link SAS Associate
Tin-Can Island Container Terminal Ltd Associate
Guizhou Qiandongnan Continental Land Port Operation Co., Ltd. Associate
Nanshan Group and its subsidiaries Associate
Shanghai International Port (Group) Co., Ltd. Associate
Shenzhen Baohong Technology Co., LTD Associate
Tianjin Haitian Bonded Logistics Co., Ltd. Associate
Zhanjiang Merchants Port City Investment Co., LTD Associate
Zhanjiang Xiagang Joint Development Co., LTD Associate
Pearl River Inland Cargo Terminal Co. LTD Associate
Shantou Zhonglian tally Co., LTD Associate
Shantou International Container Terminals Co. LTD Associate
Shenzhen Wandian Industrial Co., LTD Associate
Liaoning Port Co. LTD Associate
Ningbo Zhoushan Port Co., LTD ("Ningbo Zhoushan") Associate
Doraleh Multi-purpose Port Associate
Shenzhen Chiwan Oriental Logistics Co., LTD Associate
- 133 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
X. RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
4. Other related parties of the Company
Name of other related parties Relationship with the Company
Sri Lanka Ports Authority Minority shareholders of subsidiaries
Zhanjiang Infrastructure Minority shareholders of subsidiaries
Zhoushan Blue Sea Investment Co., LTD Minority shareholders of subsidiaries
Antong Holdings and its subsidiaries (Note) Connected person
China COSCO Shipping Group and its subsidiaries (Note) Connected person
Controlled by the same ultimate
Guangdong Sinotrans shipping Agency Co. LTD
controlling shareholder
Controlled by the same ultimate
Haitong (Shanghai) Trading Co., LTD
controlling shareholder
Controlled by the same ultimate
South China Sinotrans Supply Chain Management Co., LTD
controlling shareholder
Controlled by the same ultimate
Eurasia shipyard Enterprise Co., LTD
controlling shareholder
Controlled by the same ultimate
Qingdao Bonded Logistics Park Sinotrans Storage logistics Co. LTD
controlling shareholder
Controlled by the same ultimate
Qingdao Sinotrans Supply Chain Management Co., LTD
controlling shareholder
Controlled by the same ultimate
Shenzhen Forwarder Storage Co., LTD
controlling shareholder
Controlled by the same ultimate
Shenzhen Southern Oil (Group) Co. LTD
controlling shareholder
Controlled by the same ultimate
Shenzhen Qianhai Sinotrans Supply Chain Management Co., LTD
controlling shareholder
Shenzhen Qianhai Shekou Free Trade Investment Development Controlled by the same ultimate
Co., LTD controlling shareholder
Controlled by the same ultimate
Shenzhen West Port Security Service Company
controlling shareholder
Controlled by the same ultimate
Shenzhen Merchants International Shipping Agency Co. LTD
controlling shareholder
Controlled by the same ultimate
Shenzhen Merchants Real Estate Co., LTD
controlling shareholder
Controlled by the same ultimate
Shenzhen Merchants roller transportation Co., LTD
controlling shareholder
Controlled by the same ultimate
Shenzhen Merchant Investment Co., LTD
controlling shareholder
Controlled by the same ultimate
Shenzhen Merchants Property Management Co., LTD
controlling shareholder
Controlled by the same ultimate
Shenzhen Sinotrans shipping Agency Co. LTD
controlling shareholder
Controlled by the same ultimate
Youlian Shipyard (Shekou) Co., LTD
controlling shareholder
Controlled by the same ultimate
Youlian shipyard Co. LTD
controlling shareholder
Controlled by the same ultimate
China Merchants Haida Insurance Consultant Co. LTD
controlling shareholder
Controlled by the same ultimate
China Merchants International Cold Chain (Shenzhen) Co., LTD
controlling shareholder
Controlled by the same ultimate
China Merchants Group Finance Co. LTD
controlling shareholder
- 134 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
X. RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
4. Other related parties of the Company - continued
Name of other related parties Relationship with the Company
Controlled by the same ultimate
China Merchants Port Investment and Development Co. LTD
controlling shareholder
Controlled by the same ultimate
China Merchants Renhe Life Insurance Co. LTD
controlling shareholder
Controlled by the same ultimate
China Merchants Finance leasing (Tianjin) Co., LTD
controlling shareholder
Controlled by the same ultimate
China Merchants Food (China) Co., LTD
controlling shareholder
Controlled by the same ultimate
China Merchants Trade Finance leasing Co. LTD
controlling shareholder
Controlled by the same ultimate
China Merchants Logistics Group Qingdao Co. LTD
controlling shareholder
China Merchants Zhangzhou Development Zone Power Supply Controlled by the same ultimate
Co. LTD controlling shareholder
Controlled by the same ultimate
China Communications Import and Export Co. LTD
controlling shareholder
Controlled by the same ultimate
Guangdong Sinotrans Shipping Co. LTD
controlling shareholder
Controlled by the same ultimate
Sinotrans Container Transportation Co. LTD
controlling shareholder
Controlled by the same ultimate
China Merchants Securities Co. LTD
controlling shareholder
Controlled by the same ultimate
Yingkou Gangrong Big Data Co., LTD
controlling shareholder
Controlled by the same ultimate
Sinotrans (Hong Kong) Shipping Company limited
controlling shareholder
Controlled by the same ultimate
China Merchants Zhangzhou Development Zone Co. LTD
controlling shareholder
Controlled by the same ultimate
China Shenzhen Ocean Shipping Agency Co. LTD
controlling shareholder
Controlled by the same ultimate
Ningbo Shipping Agency Co. LTD
controlling shareholder
Controlled by the same ultimate
Haitong Kechuang (Shenzhen) Co. LTD
controlling shareholder
Controlled by the same ultimate
China Merchants Heavy Industries (Jiangsu) Co. LTD
controlling shareholder
Controlled by the same ultimate
Sinotrans Container Transport (Hong Kong) Co., LTD
controlling shareholder
Controlled by the same ultimate
China Merchants (Liaoning) Port Development Co. LTD
controlling shareholder
Controlled by the same ultimate
Yingkou Port Group
controlling shareholder
Controlled by the same ultimate
Liaoning Port Group Co. LTD
controlling shareholder
Controlled by the same ultimate
China Yangtze River Steamship Co. LTD
controlling shareholder
Controlled by the same ultimate
Shenzhen Forwarder International freight co., LTD
controlling shareholder
Controlled by the same ultimate
Sinotrans South China Co. LTD
controlling shareholder
Controlled by the same ultimate
China Merchants Gangtong Development (Shenzhen) Co., LTD
controlling shareholder
- 135 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
X. RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
4. Other related parties of the Company - continued
Name of other related parties Relationship with the Company
Controlled by the same ultimate
Sinotrans Shipping Co. LTD
controlling shareholder
Controlled by the same ultimate
Orienture Holdings Company Limited
controlling shareholder
Controlled by the same ultimate
China Merchants Finance leasing (Shanghai) Co., LTD
controlling shareholder
Where the ultimate controlling
Khor Ambado FZCo
shareholder has significant influence
Where the ultimate controlling
China Merchant Bank Co., Ltd.
shareholder has significant influence
Where the ultimate controlling
China Merchants United Development Co. LTD
shareholder has significant influence
Note: The Company's former chairman Fu Gangfeng resigned as the chairman of the Company
on 31 January 2020, and became the director, general manager of China COSCO Shipping
Corporation Limited within 12 months after his resign as the Company's chairman.
According to the Rules Governing the Listing of Shares on Shenzhen Stock Exchange,
China COSCO Shipping Corporation Limited is a related party of the Company; from 1
January 2021 to 30 June 2021, the Company's deputy general manager Zheng Shaoping
work as the director of the Company and the chairman of Antong Holdings Co., Ltd.
Therefore, the related party transactions and balances for the period and within 12 months
after the period in which the aforesaid two persons were the director, senior management
personnel of China COSCO Shipping Corporation Limited and Antong Holdings Co., Ltd.
are disclosed.
- 136 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
X. RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions
(1) Rendering and receipt of service
Unit: RMB
Pricing method and Amount incurred Amount incurred
Content of
Related party decision procedures of in the current in the prior
transaction
related transactions peri od peri od
Receipt of service:
Shenzhen Wandian Industrial Co., Ltd. Service expenditure Negotiation 23,540,775.37 -
Hoi Tung (Shanghai) Co mpany Limited Service expenditure Negotiation 8,531,341.56 1,075,389.11
Qingdao Qianwan West Port United Wharf
Service expenditure Negotiation 7,456,011.20 7,457,789.57
Co., Ltd.
Shenzhen West Port Security Service
Service expenditure Negotiation 4,195,429.30 -
Co mpany
Yiu Lian Dockyards Limited Service expenditure Negotiation 3,623,433.09 4,313,298.43
Shenzhen China Merchants Property
Service expenditure Negotiation 2,679,300.52 3,753,910.42
Management Co., Ltd.
Shenzhen Chiwan Oriental Logistics Co., Ltd. Service expenditure Negotiation 2,332,826.73 -
China Nanshan Development (Group)
Service expenditure Negotiation 2,229,485.70 21,754,790.42
Incorporation
China Merchants Zhangzhou Development
Service expenditure Negotiation 2,166,324.95 1,902,146.11
Zone Power Supply Co., Ltd.
Yingkou Port Group Co., Ltd. Service expenditure Negotiation 1,691,743.27 -
Shenzhen Qianhai Shekou Free Trade
Service expenditure Negotiation 1,559,726.18 -
Investment Develop ment Co., Ltd.
Guangdong Sinotrans Shipping Co., Ltd. Service expenditure Negotiation 1,542,016.89 764,449.65
China Merchants Food (China) Co., Ltd. Service expenditure Negotiation 1,201,759.76 50,676.00
China Marine Sh ipping Agency Shenzhen
Service expenditure Negotiation 1,022,766.82 1,095,062.50
Co. , Ltd.
China Merchants Haida Insurance Consultant
Service expenditure Negotiation 243,438.98 2,351,146.06
Co. LTD
China Merchants Bureau Logistics Group
Service expenditure Negotiation 183,960.81 1,011,481.25
Qingdao Co., Ltd
Shenzhen West Port Security Service
Service expenditure Negotiation - 2,140,188.70
Co mpany
China Merchants Renhe Life Insurance
Service expenditure Negotiation - 1,828,081.51
Co. LTD
Khor A mbado FZCo Service expenditure Negotiation - 1,334,921.77
Other related party Service expenditure Negotiation 7,203,788.85 4,255,513.74
China Merchants Group Finance Co. LTD Interest payments Negotiation 30,389,688.50 17,054,903.23
China Merchants Bank Co. LTD Interest payments Negotiation 3,268,813.97 1,510,507.99
China Merchants Finance leasing (Tianjin)
Interest payments Negotiation - 3,463,541.67
Co., LTD
Nanshan Group and its subsidiaries Property utilities Negotiation 290,902.36 2,579,881.82
Shenzhen Merchants Property Management
Property utilities Negotiation - 4,649,769.22
Co., LTD
Other related party Property utilities Negotiation - 942,608.78
Total 105,353,534.81 85,290,057.95
- 137 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
X. RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions - continued
(1) Rendering and receipt of service - continued
Unit: RMB
Pricing method and Amount incurred Amount incurred
Content of
Related party decision procedures of in the current in the prior
transaction
related transactions peri od peri od
Rendering of service:
Antong Holding Co., Ltd. and its subsidiaries Service revenue Negotiation 98,541,945.59 61,740,139.88
Zhanjiang Cosco Shipping Logistics Co. LTD Service revenue Negotiation 88,294,684.14 65,809,923.78
China COSCO Sh ipping Group and its
Service revenue Negotiation 67,594,546.16 191,399,439.67
subsidiaries
Guangdong Sinotrans shipping Agency
Service revenue Negotiation 38,552,309.99 19,894,702.69
Co. LTD
China Zhanjiang ocean Shipping Agency
Service revenue Negotiation 25,067,430.42 26,430,608.95
Co. LTD
Qingdao Qianwan Un ited Container Terminal
Service revenue Negotiation 22,637,413.70 22,646,763.19
Co. LTD
Liaoning Port Co. LTD Service revenue Negotiation 19,864,136.94 -
Yingkou Port Group Co. LTD Service revenue Negotiation 16,175,416.62 -
Shenzhen Merchants International Shipping
Service revenue Negotiation 9,322,068.75 2,941,424.71
Agency Co. LTD
You lian Shipyard (Shekou) Co., LTD Service revenue Negotiation 7,465,890.54 2,412,855.54
Liaoning Port Group Co. LTD Service revenue Negotiation 6,851,108.81 -
Ningbo Zhoushan Service revenue Negotiation 6,777,410.02 -
Shenzhen Baohong Technology Co., LTD Service revenue Negotiation 5,643,062.05 -
Shenzhen Qianhai Sinotrans Supply Chain
Service revenue Negotiation 3,679,093.79 2,382,499.13
Management Co., LTD
China Merchants International Cold Chain
Service revenue Negotiation 3,453,502.00 3,358,865.70
(Shenzhen) Co., LTD
Shenzhen Sinotrans shipping Agency Co. LTD Service revenue Negotiation 2,818,483.03 2,259,799.79
Yingkou Gangrong Big Data Co., LTD Service revenue Negotiation 2,332,986.53 289,466.96
Shantou International Container Terminals
Service revenue Negotiation 2,257,929.61 1,263,661.19
Co. LTD
China Yangtze River Steamship Co. LTD Service revenue Negotiation 2,133,440.00 -
China Shenzhen ocean shipping Agency
Service revenue Negotiation 2,099,723.96 10,190,194.09
Co. LTD
East Guizhou Land Port Operat ion Co. LTD Service revenue Negotiation 2,046,879.50 1,643,215.08
Shantou Zhonglian tally Co., LTD Service revenue Negotiation 2,033,121.99 359,742.38
Qingdao Qianwan West Port United Wharf
Service revenue Negotiation 1,724,078.14 1,612,607.38
Co., LTD
China Merchants Heavy Industries (Jiangsu)
Service revenue Negotiation 1,494,112.80 225,074.82
Co. LTD
Qingdao Qianwan New Union Container
Service revenue Negotiation 1,446,408.10 1,453,413.79
Terminal Co. LTD
Sinotrans (Hong Kong) Shipping Co mpany
Service revenue Negotiation 1,391,042.72 -
limited
South China Sinotrans Supply Chain
Service revenue Negotiation 1,277,958.26 3,952,260.53
Management Co., LTD
Sinotrans container transport (Hong Kong)
Service revenue Negotiation 1,277,956.30 304,231.20
Co., LTD
- 138 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
X. RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions - continued
(1) Rendering and receipt of service - continued
Unit: RMB
Pricing method and
Amount Amount
Content of decision procedures
Related party incurred in the incurred in the
transaction of related
current period prior period
transactions
Rendering of service: - continued
Qingdao Bonded Logistics Park Sinotrans
Service revenue Negotiation 1,166,773.53 853,254.61
Storage logistics Co. LTD
Guangdong Sinotrans Shipping Co. LTD Service revenue Negotiation 1,066,579.80 463,819.11
Yantai Port Group Laizhou Port Co. LTD Service revenue Negotiation 1,006,226.41 -
Guizhou Qiandongnan Land Port
Service revenue Negotiation 698,145.68 2,170,933.76
Operation Co. LTD
China Merchants Port Investment
Service revenue Negotiation 651,707.54 6,875,471.73
development Co. LTD
Qingdao Sinotrans Supply Chain
Service revenue Negotiation 280,430.34 1,381,761.20
Management Co., LTD
Doraleh Multi-purpose Port Service revenue Negotiation 241,063.92 1,007,325.33
Sinotrans Container Transportation
Service revenue Negotiation 137,305.63 1,867,447.60
Co. LTD
Shenzhen Forwarder Storage Co., LTD Service revenue Negotiation 122,507.33 3,271,684.66
Shenzhen Baohong Technology Co., LTD Service revenue Negotiation - 4,043,370.07
Shenzhen forwarder International freight
Service revenue Negotiation - 3,093,622.85
Co., LTD
Ningbo Daxie Service revenue Negotiation - 1,467,170.05
Other related party Service revenue Negotiation 7,000,909.78 7,103,107.07
Terminal Link SAS Interest income Negotiation 83,985,071.35 47,175,076.70
Port of Newcastle and its subsidiaries Interest income Negotiation 32,103,266.39 29,765,975.26
China Merchant Bank Co., Ltd. Interest income Negotiation 27,709,063.52 14,161,811.40
China Merchants Group Finance
Interest income Negotiation 16,044,336.39 4,840,581.56
Company Limited
China Merchants Harbor City Interest income Negotiation 1,957,067.27 24,449,639.56
China Merchants Antong Logistics
Interest income Negotiation - 3,248,630.14
Management Co., LTD
Other related party Interest income Negotiation 823,676.39 735,917.68
Total 619,248,271.73 580,547,490.79
- 139 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
X. RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions - continued
(2) Leases with related parties
The Group as the lessor:
Unit: RMB
Pricing method and Lease income Lease income
Type of leased
Name of the lessee decision procedures of recognized in the recognized in the
assets
related transactions current period pri or peri od
Qingdao Qianwan West Port United Wharf Port and wharf
Negotiation 4,815,722.20 4,663,926.38
Co., Ltd. facilit ies
Qingdao Bonded Logistics Park Sino-foreign
Buildings Negotiation 2,825,722.88 2,616,103.75
Transport Warehousing Logistics Co., Ltd.
China Merchants Food (China) Co., Ltd. Buildings Negotiation 2,641,029.00 2,338,264.98
China Co mmunicat ions Import & Export
Buildings Negotiation 2,606,198.16 2,304,217.40
Co., Ltd.
Qingdao Sinotrans Supply Chain Management
Buildings Negotiation 1,947,099.43 1,030,172.01
Co., Ltd.
Qingdao Qianwan Un ited Container Terminal
Buildings Negotiation 1,504,168.98 -
Co., Ltd.
China Merchants Securities Co., Ltd. Buildings Negotiation 1,239,270.84 1,126,349.15
Nanshan Group and its subsidiaries Buildings Negotiation 1,205,711.40 1,221,353.05
Yiu Lian Dockyards (Shekou) Limited Buildings Negotiation 1,180,174.54 1,363,141.03
Sinotrans South China Co., Ltd. Buildings Negotiation 733,987.15 -
Buildings, land use
Other related party Negotiation 2,954,403.60 2,533,033.88
rights
Total 23,653,488.18 19,196,561.63
(3) Related party guarantees
The Group as the guarantor
Unit: RMB
The guarantee
Guaranteed
Secured party Credit line Commencement date Maturity date has been
amount
completed or not
For the period fro m 1 January to 30 June 2021
Terminal Link SAS (Note 1) 67,144,809.51 67,144,809.51 1 June 2013 2033 No
Khor A mbado FZCo (Note 2) 186,692,802.05 112,388,291.40 24 May 2019 2032 No
Total 253,837,611.56 179,533,100.91
For the period fro m 1 January to 30 June 2020
Terminal Link SAS (Note 1) 80,622,102.91 80,622,102.91 1 June 2013 2033 No
Khor A mbado FZCo (Note 2) 203,198,400.00 122,324,592.81 24 May 2019 2032 No
Total 283,820,502.91 202,946,695.72
Note 1: CMA CGM S.A. is another shareholder of Terminal Link SAS, an associate of the Group.
The Group has made a commitment to CMA CGM S.A. that the Group will provides
guarantee for its bank loan financing to the associate Terminal Link SAS and other
liabilities to the extent of the Group's 49% ownership interest in the company. The actual
guaranteed amount is RMB 67,144,809.51 on 30 June 2021. If any guarantee liability
occurs, the Group will compensate CMA CGM S.A.
Note 2: Khor Ambado FZCo is a related company of the Group's common ultimate controlling
shareholder. The Group provides guarantee for its bank loans and other liabilities, with
actual guaranteed amount of RMB 112,388,291.40 as at 30 June 2021.
- 140 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
X. RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions - continued
(4) Borrowings and loans with related parties
Unit: RMB
Commencement
Related party Amount Maturity date Description
date
For the period fro m 1 January to 30 June 2021
Borro wings
China Merchants Group Finance Fixed interest rate of
197,112,248.22 1 March 2021 21 June 2024
Co mpany Limited 1.2000%
China Merchants Group Finance Fixed interest rate of
80,661,051.60 17 May 2021 12 March 2029
Co mpany Limited 4.5100%
China Merchants Group Finance Fixed interest rate of
58,800,000.00 8 April 2021 31 October 2023
Co mpany Limited 1.2000%
China Merchants Group Finance Fixed interest rate of
50,044,968.20 11 June 2021 10 June 2022
Co mpany Limited 3.8500%
China Merchants Group Finance Fixed interest rate of
47,050,263.90 9 April 2021 8 April 2022
Co mpany Limited 3.8500%
China Merchants Group Finance Fixed interest rate of
33,029,679.02 25 June 2021 24 June 2022
Co mpany Limited 3.8500%
China Merchants Group Finance Fixed interest rate of
30,030,917.00 10 May 2021 9 May 2022
Co mpany Limited 3.7100%
China Merchants Group Finance Fixed interest rate of
20,021,388.90 19 April 2021 18 April 2022
Co mpany Limited 3.8500%
China Merchants Group Finance Fixed interest rate of
10,075,542.47 7 June 2021 4 December 2021
Co mpany Limited 2.5500%
China Merchants Group Finance Fixed interest rate of
10,016,767.12 22 March 2021 18 September 2021
Co mpany Limited 2.7300%
Total 536,842,826.43
For the period fro m 1 January to 30 June 2020
Borro wings
China Merchants Group Finance Fixed interest rate of
200,225,000.00 14 April 2020 13 April 2021
Co mpany Limited 4.0500%
China Merchants Group Finance Fixed interest rate of
50,051,527.78 21 May 2020 20 May 2021
Co mpany Limited 3.7100%
China Merchants Group Finance Fixed interest rate of
47,000,000.00 6 January 2020 7 October 2024
Co mpany Limited 4.5125%
China Merchants Group Finance Fixed interest rate of
29,032,625.00 10 April 2020 24 December 2020
Co mpany Limited 4.0500%
China Merchants Group Finance Fixed interest rate of
20,022,500.00 7 April 2020 6 April 2021
Co mpany Limited 4.0500%
China Merchants Group Finance Fixed interest rate of
14,033,425.02 13 March 2020 12 March 2029
Co mpany Limited 4.5050%
China Merchants Group Finance Fixed interest rate of
10,000,000.00 19 June 2020 31 October 2023
Co mpany Limited 1.2000%
China Merchants Group Finance Fixed interest rate of
6,109,400.45 22 June 2020 21 June 2024
Co mpany Limited 1.2000%
China Merchants Group Finance Fixed interest rate of
5,045,500.00 25 March 2020 12 March 2029
Co mpany Limited 4.5050%
China Merchants Group Finance Fixed interest rate of
3,758,844.48 22 April 2020 12 March 2029
Co mpany Limited 4.5050%
China Merchants Group Finance Fixed interest rate of
2,659,474.10 5 June 2020 12 March 2029
Co mpany Limited 4.5050%
Total 387,938,296.83
Lending
Fixed interest rate of
Terminal Link SAS 3,016,715,205.48 26 March 2020 26 March 2028
6.0000%
Fixed interest rate of
Port of Newcastle and its subsidiaries 811,518,975.10 30 May 2020 23 July 2023
8.0000%
Tianjin Haitian Bonded Logistics Fixed interest rate of
34,300,000.00 3 January 2020 2 January 2023
Co., Ltd. 4.7500%
Total 3,862,534,180.58
- 141 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
X. RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions - continued
(5) Asset transfer with related parties
Pricing method
and decision Amount incurred
Content of Amount incurred
Related Party procedures of in the current
transaction in the prior period
related period
transactions
Hoi Tung (Shanghai) Company Machinery and
Negotiation 1,371,681.42 8,202,477.87
Limited equipment
Hoi Tung Innotek (Shenzhen) Machinery and
Negotiation - 1,946,000.00
Company Limited equipment
General office
Other related party Negotiation - 83,584.00
equipment
Total 1,371,681.42 10,232,061.87
(6) Compensation for key management personnel
Unit: RMB
Item Closing balance Opening balance
Compensation for key management personnel 8,523,459.60 12,350,017.98
6. Amounts due from/to related parties
(1) Amounts due from related parties
Unit: RMB
Item Related party Closing balance Opening balance
China Merchant Bank Co., Ltd. 2,691,250,944.82 1,901,262,575.44
Cash and bank
China Merchants Group Finance Company Limited 905,012,170.44 1,568,924,175.58
balances
Total 3,596,263,115.26 3,470,186,751.02
Held-for-trading
China Merchant Bank Co., Ltd. 1,000,000,000.00 850,000,000.00
financial assets
Zhanjiang Cosco Shipping Logistics Co. LTD 19,342,270.90 4,326,223.02
Liaoning Port Co. LTD 16,493,768.48 -
Antong Holding Co., Ltd. and its subsidiaries 15,653,452.72 10,508,254.42
Guangdong Sinotrans shipping Agency Co. LTD 9,678,632.47 7,777,640.18
Qingdao Qianwan United Container Terminal Co. LTD 6,905,264.80 -
Qingdao Qianwan West Port United Wharf Co., LTD 4,772,120.07 2,007,669.18
Shenzhen Merchants International Shipping Agency
3,543,875.73 590,901.89
Co. LTD
Khor Ambado FZCo 2,893,383.20 2,774,015.84
Youlian Shipyard (Shekou) Co., LTD 1,837,823.70 725,330.10
Sinotrans Container Transportation Co. LTD 1,781,312.75 1,148,569.75
Accounts
Port De Djibouti S.A 1,648,150.20 1,497,611.83
receivable
Ningbo Shipping Agency Co. LTD 822,263.98 7,773,568.86
Shenzhen Baohong Technology Co., LTD 641,391.13 2,641,391.12
Great Horn Development Company Fzco 437,535.62 1,427,020.52
East Guizhou Land Port Operation Co. LTD 44,900.00 3,612,221.02
South China Sinotrans Supply Chain Management
40,116.00 1,035,675.13
Co., LTD
Guizhou Qiandongnan Land Port Operation Co. LTD 11,260.00 1,061,604.20
China Ocean Shipping Group Company Limited and
- 120,615,548.37
its subsidiaries
Other related party 13,265,812.48 7,890,241.86
Total 99,813,334.23 177,413,487.29
- 142 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
X. RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
6. Amounts due from/to related parties - continued
(1) Amounts due from related parties - continued
Unit: RMB
Item Related party Closing balance Opening balance
Shanghai International Port (Group) Co. LTD 756,630,823.35 -
Nanshan Group and its subsidiaries 316,246,500.00 210,831,000.00
Liaoning Port Co. LTD 74,242,730.44 -
Qingdao Port International Co., LTD 39,116,713.02 -
Pearl River Inland Cargo Terminal Co. LTD 33,692,528.00 57,607,520.00
Port De Djibouti S.A 23,097,175.98 23,248,597.69
Tin-Can Island Container Terminal Ltd 22,996,441.34 33,289,037.77
Zhanjiang Cosco Shipping Logistics Co. LTD 13,378,666.52 13,378,666.52
Shenzhen Qianhai Shekou Free Trade Investment
6,000,000.00 4,000,000.00
Development Co., LTD
Zhanjiang Infrastructure Construction investment
Other 4,907,365.06 31,513,558.60
Group Co. LTD
receivables
Zhoushan Blue Sea Investment Co., LTD 2,899,163.95 4,996,989.39
Shenzhen Merchants roller transportation Co., LTD 2,899,163.95 2,899,163.95
China Merchants (Liaoning) Port Development
2,500,000.00 2,000,000.00
Co. LTD
Yingkou Port Group Co. LTD 2,379,512.33 -
Eurasia shipyard Enterprise Co., LTD 1,411,165.96 1,422,660.84
International Djibouti Industrial Parks Operation
1,142,084.99 922,676.08
FZCo
Shenzhen Merchant Investment Co., LTD 1,132,846.40 1,068,658.39
Other related party 53,398,607.28 3,258,884.44
Total 1,358,071,488.57 390,437,413.67
Advance
Other related party 215,094.29 244,729.25
payment
Unit: RMB
Item Related party Closing balance Opening balance
Non-current Terminal Link SAS 43,195,959.11 51,286,674.10
assets due Port of Newcastle and its subsidiaries 31,680,947.48 16,473,559.57
within one year Total 74,876,906.59 67,760,233.67
Terminal Link SAS 2,728,165,833.95 2,746,067,386.31
Port of Newcastle and its subsidiaries 798,004,103.00 815,144,304.00
Tianjin Haitian Bonded Logistics Co., Ltd. 34,300,000.00 34,300,000.00
Long-term
China Merchants Finance Lease (Tianjin) Co., Ltd. 10,000,000.00 10,000,000.00
receivables
Zhanjiang China Merchants Harbor City Investment
- 286,330,144.62
Co., Ltd.
Total 3,570,469,936.95 3,891,841,834.93
- 143 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
X. RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
6. Amounts due from/to related parties - continued
(2) Amounts due to related parties
Unit: RMB
Item Related party Closing balance Opening balance
Short-term
China Merchants Group Finance Company Limited 360,460,315.17 2,707,459,283.70
borrowings
Other current
Nanshan Group and its subsidiaries - 60,606,027.37
liabilities
Qingdao Qianwan West Port United Wharf Co., Ltd. 5,766,560.89 6,381,033.57
CHINA NANSHAN DEVELOPMENT (GROUP)
5,764,127.70 9,220,434.36
INCORPORATION
Shenzhen Wandian Industrial Co., Ltd. 5,474,619.51 -
EuroAsia Dockyard Enterprise and development Ltd. 2,289,297.08 2,994,548.16
Accounts
Yiu Lian Dockyards Limited 1,497,917.12 2,271,520.48
payable
Hoi Tung (Shanghai) Company Limited 1,197,676.00 55,666.09
Shenzhen Nanyou (Holdings) Ltd. 1,047,665.40 -
China Marine Shipping Agency Shenzhen Co. , Ltd. 650,625.00 1,264,544.50
Other related party 2,651,952.36 524,734.79
Total 26,340,441.06 22,712,481.95
Port de Djibouti S.A. - 10,350,122.63
Receipts in
Other related party 710,488.75 606,631.45
advance
Total 710,488.75 10,956,754.08
COSCO Logistics (Zhanjiang) Co., Ltd. 2,508,813.10 922,080.60
Liaoning Port Group Co., Ltd. 1,528,447.50 -
Qingdao Qianwan United Container Terminal
Contract 1,504,168.97 -
Co., Ltd.
liabilities
Guangdong Sinotrans Shipping Agency Co., Ltd. 763,011.94 2,304,015.01
Other related party 4,193,080.78 9,116,598.19
Total 10,497,522.29 12,342,693.80
- 144 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
X. RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
6. Amounts due from/to related parties - continued
(2) Amounts due to related parties - continued
Unit: RMB
Item Related party Closing balance Opening balance
China Merchants Port Investment Development Co., Ltd. 436,486,486.24 26,418,918.90
China Merchants Union Development Co., Ltd. 348,500,295.23 -
PORT DE DJIBOUTI S.A 259,498,179.18 175,497,252.70
China Merchants Gangtong Development (Shenzhen) Co., Ltd. 140,933,640.00 -
Economic and trade crown de development Co., LTD 75,608,046.12 -
Sri Lanka Ports Authority 34,032,542.04 34,255,854.79
Liaoning Port Co., Ltd. 29,428,227.19 -
Shenzhen Infrastructure Investment Fund Partnership
24,643,069.16 -
Enterprise (limited partnership)
Zhanjiang China Merchants Harbor City Investment Co., Ltd. 24,500,000.00 -
Broadford Global Limited 21,019,399.04 -
China Merchants Zhangzhou Development Zone Co., Ltd. 20,000,000.00 20,000,000.00
China Merchants Real Estate (Shenzhen) Co., Ltd. 14,305,122.78 14,305,122.78
Dalian Port Container Development Co. LTD 12,160,517.31 12,160,517.31
Other payables Sinotrans Shipping Co., Ltd. 10,049,355.79 -
Shenzhen Merchants Commercial Property Investment
9,255,975.41 8,447,512.23
Co., Ltd.
Terminal Link 3,980,965.01 89,905,681.62
Centralized Logistics 3,972,477.39 3,972,477.39
Shenzhen Qianhai Sinotrans Supply Chain Management
1,565,999.68 1,013,738.40
Co., Ltd.
Zhanjiang Xiagang United Development Co., Ltd. 1,433,473.84 1,433,730.78
ORIENTURE HOLDINGS COMPANY LIMITED 1,277,244.00 -
China Merchants Food (China) Co., Ltd. 997,560.14 1,161,179.14
China Merchants Port Investment Development Co., Ltd. 943,526.47 2,910,544.27
Shenzhen Baohong E-Commerce Integrated Services Co., Ltd. 746,226.77 2,634,014.09
Shenzhen Penavico Warehousing Co., Ltd. - 1,127,339.68
Other related party 5,720,463.79 2,819,966.38
Total 1,481,058,792.58 398,063,850.46
China Merchants Finance Lease (Shanghai) Co., Ltd. 104,738,787.19 -
China Merchants Tongshang Finance Lease Co., Ltd. 59,482,964.07 58,348,704.99
Non-current
Nanshan Group and its subsidiaries 50,410,822.69 54,030,933.00
liabilities due
China Merchants Group Finance Company Limited 48,469,321.15 51,423,306.47
within one
China Merchants Finance Lease (Tianjin) Co., Ltd. 33,034,721.43 138,409,402.75
year
Other related party - 53,267,076.87
Total 296,136,616.53 355,479,424.08
Other
non-current Nanshan Group and its subsidiaries 1,067,982.93 944,011.06
liabilities
China Merchants Finance Lease (Shanghai) Co., Ltd. 228,333,546.47 -
Nanshan Group and its subsidiaries 86,656,750.22 114,304,842.23
China Merchants Tongshang Finance Lease Co., Ltd. 75,010,061.94 104,616,135.92
Lease liabilities
China Merchants Finance Lease (Tianjin) Co., Ltd. 63,333,403.31 358,333,616.46
Other related party 4,304,459.38 -
Total 457,638,221.32 577,254,594.61
China Merchants Group Finance Company Limited 514,157,284.53 426,100,835.53
Long-term
China Merchant Bank Co., Ltd. 174,847,500.00 109,033,232.39
borrowings
Total 689,004,784.53 535,134,067.92
- 145 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
XI. SHARE-BASED PAYMENTS
1. Summary of share-based payme nts
Total number of the Company's equity instruments 530,000 shares
granted during the period
Total number of the Company's equity instruments N/A
vested during the period
Total number of the Company's equity instruments N/A
lapsed during the period
Exercise price is RMB 17.80;
Range of exercise prices and remaining contractual life
remaining contractual life is 67 months;
of the Company's share options outstanding at the
Exercise price is RMB 15.09;
end of the period
remaining contractual life is 67 months
Range of exercise prices and remaining contractual
life of the Company's other equity instruments N/A
outstanding at the end of the period
2. Equity-settled share-based payme nts
Unit: RMB
The method of determining the fair value of equity The Black-Scholes model is adopted to estimate the
instruments at the grant date cost of granted stock options
On each asset and liability date in the waiting period,
the best estimate is made and the number of equity
The method of determining the best estimate of the
instruments expected to be vested is revised based on
number of equity instruments expected to be vested
the latest obtained follow-up information such as
changes in the number of vested employees.
Reasons for the significant difference between the estimate
N/A
in the current period and that in the prior period
Amounts of equity-settled share-based payments
15,956,521.39
accumulated in capital reserve
Total expenses recognized arising from equity-settled
10,800,221.18
share-based payments
According to the "Approval on the Implementation of the Stock Option Incentive Plan of China
Merchants Port Group Co., Ltd." (Guo Zi Kao Fen [2019] No. 748) of the State-owned Assets
Supervision and Administration Commission of the State Council, approved by the Company's
first extraordinary general meeting of shareholders on 3 February 2020, the Company will
implement a stock option plan on 3 February 2020 (granting date), granting 17.198 million stock
options to 238 incentive objects at an exercise price of RMB 17.80 per share. The lockup period is
24 months since the date on which the option is granted. In the premise that vesting conditions are
satisfied, the options may be exercised after 24 months since the granting date. The options are
exercised in three tranches, including 40% exercisable after 24 months but before 36 months
subsequent to the granting date; 30% exercisable after 36 months but before 48 months
subsequent to the granting date; and 30% exercisable after 48 months subsequent to the granting
date. Each option represents the rights to subscribe one ordinary share of the Company.
- 146 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
XI. SHARE-BASED PAYMENTS - continued
2. Equity-settled share-based payme nts - continued
On January 29, 2021, approved by the tenth Board of Directors at the first extraordinary general
meeting of shareholders of the year 2021, the Company implemented a stock option plan effective
January 29, 2021, granting 530,000 stock options to three incentive targets at the exercise price of
RMB 15.09 per share and the grant date of January 29, 2021. Stock options are locked up for 24
months from the date of grant, and can be exercised after 24 months of grant, subject to the
satisfaction of exercise conditions. The exercise will be in two tranches, 50% of the first tranche
(24 months from the grant date to 36 months from the grant date) and 50% of the second tranche
(36 months to 72 months from the grant date); Each stock option gives the holder the right to
subscribe for one common stock of the company.
XII. COMMITMENTS AND CONTINGENCIES
1. Significant commitments
Unit: RMB
Item Closing balance Opening balance
Commitments that have been entered into but have not been
recognized in the financial statements
- Commitment to inject capital in investees 16,600,000.00 11,500,000.00
- Commitment to acquire long-term assets 2,035,035,538.99 2,682,977,514.73
- Commitment to invest port construction 998,409,375.73 1,004,960,692.18
-Others - 20,831,652.14
Total 3,050,044,914.72 3,720,269,859.05
2. Contingencies
Unit: RMB
Item Closing balance Opening balance
Contingent liabilities arising from litigations (Note 1) 223,604,924.98 213,109,668.45
Guarantees for borrowings of associates (Note 2) 179,533,100.91 184,129,723.74
Total 403,138,025.89 397,239,392.19
Note 1:This represents the significant contingent liabilities arising from the litigations between
TCP and its subsidiaries and local tax authority, employee or former employee of TCP and
its subsidiaries in Brazil at as the year end. According to the latest estimates of the Group's
management, the possible compensation is RMB223,604,924.98 but it is not likely to
cause outflow of economic benefits from the Group. Therefore, the contingent liabilities
arising from the above pending litigations are not recognized as provisions. The counter-
bonification where the Group as the beneficiary will be executed by the former TCP
shareholder that disposed the shares. According to the counter-bonification agreement, the
former TCP shareholder need to make counter-bonification to the Group in respect of the
above contingent liabilities, with the compensation amount not exceeding pre-determined
amount and specified period.
Note 2: As of 30 June 2021, the guarantees provided by the Group to related parties are set out in
Note X 5 (3).
- 147 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
XII. COMMITMENTS AND CONTINGENCIES - continued
2. Contingencies - continued
As of 30 June 2021, the Group's directors assessed the risk of default by related parties in respect
of above loans and other liabilities. The directors believe that the risk is immaterial and there is
minor possibility of loss due to the guarantee.
As of 30 June 2021, in addition to aforesaid contingencies, the Group had no other significant
guarantee or contingencies that need to be explained.
XIII. OTHER SIGNIFICANT EVENTS
1. Segment reporting
(1) Basis for determining reporting segments and accounting policies
The key management team of the Company is regarded as the CODM, who reviews the Group's
internal reports in order to assess performance, allocate resources and determine the operating
segments.
The CODM manages the Group's operations by divisions from both business and geographic
perspectives.
In respect of business segments, management assesses the performance of the Group's business
operations including ports operation, bonded logistics operation and other operations.
Ports operation
Ports operation includes container terminal operation, bulk and general cargo terminal operation
operated by the Group and its associates and joint ventures. The Group's reportable segments of
the ports operation are as follows:
(a) Mainland China, Hong Kong and Taiwan
Pearl River Delta
Yangtze River Delta
Bohai Rim
Others
(b) Other locations outside of Mainland China, Hong Kong and Taiwan
Bonded logistics operation
Bonded logistics operation includes logistics park operation, ports transportation and airport cargo
handling operated by the Group and its associates and joint ventures.
- 148 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
XIII. OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(1) Basis for determining reporting segments and accounting policies - continued
(b) Other locations outside of Mainland China, Hong Kong and Taiwan - continued
Other operations
Other operations mainly includes property development and investment and logistics business,
property investment operated by the Group and corporate function.
Each of the segments under ports operation include the operations of a number of ports in various
locations within one geographic location, each of which is considered as a separate operating
segment by the CODM. For the purpose of segment reporting, these individual operating
segments have been aggregated into reportable segments on geographic basis in order to present a
more systematic and structured segment information. To give details of each of the operating
segments, in the opinion of the directors of the Company, would result in particulars of excessive
length.
Bonded logistics operation and other operations include a number of different operations, each of
which is considered as a separate but insignificant operating segment by the CODM. For segment
reporting, these individual operating segments have been aggregated according to the natures of
their operations to give rise to more meaningful presentation.
There are no material sales or other transactions between the segments.
As at 30 June 2021, around 74% of The Group's non-current assets other than financial
instruments and deferred tax assets are located in Mainland China.
- 149 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
XIII. OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(2) Segment financial information
Segment financial information for the period from 1 January to 30 June 2021 is as follows:
Unit: RMB
Ports operation
Mainland China, Hong Kong and Taiwan Bonded logistics Unallocated
Item operation Others amount Total
Yangtze River Other locations Sub-total
Pearl River Delta Bohai Rim Others
Delta
Operating income 2,958,636,092.61 445,352,534.85 29,216,911.55 1,835,209,454.62 1,780,044,983.01 7,048,459,976.64 204,996,959.89 86,485,925.73 - 7,339,942,862.26
Operating cost 1,463,264,383.33 294,515,383.40 24,262,314.83 1,357,822,363.64 828,625,928.99 3,968,490,374.19 116,498,905.11 113,461,884.97 - 4,198,451,164.27
Segment operating profit
1,495,371,709.28 150,837,151.45 4,954,596.72 477,387,090.98 951,419,054.02 3,079,969,602.45 88,498,054.78 -26,975,959.24 - 3,141,491,697.99
(loss)
Adjustments:
Taxes and levies 14,236,877.98 4,434,038.81 804,172.44 22,100,637.68 21,478,264.65 63,053,991.56 12,585,134.87 11,962,498.86 70,009.19 87,671,634.48
Administrative expense 184,243,456.42 18,532,917.24 4,506,885.61 234,916,150.46 110,937,648.90 553,137,058.63 21,077,687.84 500,756.95 191,654,469.95 766,369,973.37
R&D expenses 78,300,758.52 17,746,269.79 - 2,297,382.94 - 98,344,411.25 - - - 98,344,411.25
Financial expenses 29,725,717.45 8,678,428.13 -777,466.39 63,808,478.07 56,277,939.54 157,713,096.80 7,761,420.36 12,483,780.77 552,150,715.95 730,109,013.88
Other income 261,485,766.57 3,756,131.01 5,469.40 35,096,987.85 - 300,344,354.83 5,384,761.18 253,142.61 - 305,982,258.62
Investment income (losses) 160,123,605.49 2,359,088,694.76 166,101,087.00 -125,284.28 232,031,348.91 2,917,219,451.88 5,357,126.04 685,388,257.49 1,778,756.18 3,609,743,591.59
Gains (losses) from changes
- - -45,536,366.63 7,839.22 -443,004,339.04 -488,532,866.45 - - - -488,532,866.45
in fair value
Impairment gains (losses)
-3,259,224.54 - - 1,028,795.37 -356,511.85 -2,586,941.02 608.82 - - -2,586,332.20
of credit
Impairment gains of assets - - - - - - - - - -
Gains from disposal of assets 3,341,383.58 - 6,676,633.08 -1,025,646.41 -7,563.09 8,984,807.16 474,861.45 - -26,950.69 9,432,717.92
Operating profit (loss) 1,610,556,430.01 2,464,290,323.25 127,667,827.91 189,247,133.58 551,388,135.86 4,943,149,850.61 58,291,169.20 633,718,404.28 -742,123,389.60 4,893,036,034.49
- 150 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
XIII. OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(2) Segment financial information - continued
Segment financial information for the period from 1 January to 30 June 2021 is as follows: - continued
Unit: RMB
Ports operation
Mainland China, Hong Kong and Taiwan Bonded logistics Unallocated
Item Others Total
Pearl River Yangtze River Other locations Sub-total operation amount
Bohai Rim Others
Delta Delta
Non-operating income 5,880,047.84 222,001.00 117.74 5,665,939.99 14,120,880.19 25,888,986.76 16,057.97 7,500.52 3,075,124.48 28,987,669.73
Non-operating
2,607,728.49 520,306.61 - 2,859,851.13 8,335,822.20 14,323,708.43 - - 155.84 14,323,864.27
expenses
Gross profit (loss) 1,613,828,749.36 2,463,992,017.64 127,667,945.65 192,053,222.44 557,173,193.85 4,954,715,128.94 58,307,227.17 633,725,904.80 -739,048,420.96 4,907,699,839.95
Income tax expenses 445,759,645.96 127,856,225.71 2,651,491.03 35,828,242.11 -34,288,062.34 577,807,542.47 16,258,079.87 42,355,973.99 7,016,998.79 643,438,595.12
Net profit (loss) 1,168,069,103.40 2,336,135,791.93 125,016,454.62 156,224,980.33 591,461,256.19 4,376,907,586.47 42,049,147.30 591,369,930.81 -746,065,419.75 4,264,261,244.83
Segment assets 31,419,667,673.20 37,048,877,827.99 7,821,876,057.03 25,610,960,074.80 43,304,350,785.30 145,205,732,418.32 3,127,111,154.80 18,920,556,283.34 1,447,933,155.60 168,701,333,012.06
Total assets in the financial statements 168,701,333,012.06
Segment liabilities 15,881,739,330.71 1,604,929,487.56 168,535,261.21 7,085,779,290.05 9,789,776,859.51 34,530,760,229.04 512,242,308.80 1,367,896,065.98 24,014,187,743.26 60,425,086,347.08
Total liabilities in the financial statements 60,425,086,347.08
Supplementary
information:
Depreciation and
413,217,286.57 97,809,276.72 576,581.77 453,985,137.11 390,400,077.86 1,355,988,360.03 48,120,450.03 87,627,524.99 11,009,272.95 1,502,745,608.00
Amortization
Interest income 58,372,755.01 1,901,649.27 203,076.80 16,018,660.30 120,871,526.13 197,367,667.51 551,704.45 1,250,580.78 -15,978,940.81 183,191,011.93
Interest expense 34,508,206.53 4,866,262.52 - 79,738,998.15 153,574,206.66 272,687,673.86 8,253,482.58 15,433,783.96 596,135,609.36 892,510,549.76
Investment income
from long-term
126,099,863.96 2,359,088,694.75 126,123,636.71 23,270,489.39 232,031,348.91 2,866,614,033.72 5,357,126.04 685,388,257.49 - 3,557,359,417.25
equity investment
under equity method
Long-term equity
investment under 4,221,992,878.44 30,182,199,522.01 6,729,096,972.51 594,343,756.26 11,747,365,977.54 53,474,999,106.76 702,501,030.64 13,251,776,094.55 - 67,429,276,231.95
equity method
Non-current assets
other than long-term 21,560,411,415.88 4,161,624,530.36 15,156,855.04 19,227,483,637.89 24,803,854,837.76 69,768,531,276.93 2,181,301,447.05 5,158,578,410.79 419,769,686.44 77,528,180,821.21
equity investment
- 151 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
XIII. OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(2) Segment financial information - continued
The Group's revenue by geographical areas of operations and information about its non-current
assets other than financial instruments and deferred tax assets presented based on the geographical
areas in which the assets are located as follows:
Unit: RMB
Amount incurred in Amount incurred in
Revenue from external transactions
the current period the prior period
Mainland China, Hong Kong and Taiwan 5,552,294,281.37 4,255,086,509.16
Pearl River Delta 3,181,051,472.13 2,616,336,283.54
Yangtze River Delta 445,352,534.85 -
Bohai Rim 90,680,819.77 86,840,044.42
Others 1,835,209,454.62 1,551,910,181.20
Other locations 1,787,648,580.89 1,707,411,207.80
Total 7,339,942,862.26 5,962,497,716.96
Unit: RMB
Total non-current assets Closing balance Opening balance
Mainland China, Hong Kong and Taiwan 107,559,680,059.35 105,111,642,513.71
Pearl River Delta 46,020,200,068.06 45,459,155,093.97
Yangtze River Delta 34,343,824,052.38 32,716,973,145.44
Bohai Rim 7,335,410,610.59 6,903,596,351.63
Others 19,860,245,328.32 20,031,917,922.67
Other locations 37,397,776,993.81 39,164,278,189.74
Total 144,957,457,053.16 144,275,920,703.45
(3) Degree of reliance on major customers
The total operating income derived from the top five clients of the Group is RMB
1,839,867,457.34, accounting for 25.07% of the Group's total operating income.
XIV. NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS
1. Other receivables
(1) Summary of other receivables
Unit: RMB
Item Closing balance Opening balance
Dividends receivable 987,547,283.67 311,297,793.86
Other receivables 1,011,643,024.62 791,414,958.18
Total 1,999,190,308.29 1,102,712,752.04
- 152 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
XIV. NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS -
continued
1. Other receivables - continued
(2) Dividends receivable
(a) Disclosure of dividends receivable
Unit: RMB
Company name Closing balance Opening balance
CMPort 652,351,928.94 -
Chiwan Wharf (Hong Kong) 147,680,363.88 147,680,363.88
Dongguan Chiwan Terminal Co., Ltd. 135,254,038.80 147,233,909.98
Ningbo Port Company Limited 35,328,355.20 -
China Merchants Bonded Logistics Co., Ltd. 15,707,120.00 15,707,120.00
Jiangsu Ninghu Expressway Co., LTD 920,000.00 460,000.00
Shenzhen Petrochemical Industry (Group) Co., Ltd. 216,400.00 216,400.00
Shenzhen Chiwan International Freight Agency Co., Ltd. 89,076.85 -
Total 987,547,283.67 311,297,793.86
Less: Provision for credit loss - -
Carrying amount 987,547,283.67 311,297,793.86
(b) Significant dividends receivable aging over 1 year
Unit: RMB
Closing Impaired
Item Reason for outstanding
balance or not
In processing and expected
Dongguan Chiwan Terminal Co., Ltd. 135,254,038.80 No
to be received in 2021
In processing and expected
China Merchants Bonded Logistics Co., Ltd. 15,707,120.00 No
to be received in 2021
Total 150,961,158.80
(3) Other receivables
(a) Disclosure of other receivables by aging
Unit: RMB
Closing balance
Aging Provision for credit Proportion of
Other receivables
loss provision (%)
Within 1 year 247,415,841.53 - -
1 to 2 years 763,898,867.62 - -
2 to 3 years - - -
Over 3 years 711,772.07 383,456.60 53.87
Total 1,012,026,481.22 383,456.60
(b) Provision for credit loss of other receivables
As part of the Company's credit risk management, the Company performs internal credit rating on
customers, and determines the expected loss ratio of other receivables under each credit rating.
Such expected average loss ratio is based on historical actual impairment and taking into
consideration of current and expected future economic conditions.
- 153 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
XIV. NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS - continued
1. Other receivables - continued
(3) Other receivables - continued
(b) Provision for credit loss of other receivables - continued
At 30 June 2021, the credit risk and expected credit loss of other receivables by categories of customers are as follows:
Unit: RMB
Closing bal ance Opening bal ance
Expected credit Lifeti me ECL Lifeti me ECL
Credit rating Lifeti me ECL Lifeti me ECL
loss ratio (% ) 12-month ECL (not credi t- Total 12-month ECL (not credi t- Total
(credit-i mpaired) (credit-i mpaired)
impaired) impaired)
A 0.00-0.10 1,011,643,024.62 - - 1,011,643,024.62 791,414,958.18 - - 791,414,958.18
B 0.10-0.30 - - - - - - - -
C 0.30-50.00 - - - - - - - -
D 50.00-100.00 - - 383,456.60 383,456.60 - - 383,456.60 383,456.60
Carrying amount 1,011,643,024.62 - 383,456.60 1,012,026,481.22 791,414,958.18 - 383,456.60 791,798,414.78
Provision for
- - 383,456.60 383,456.60 - - 383,456.60 383,456.60
credit loss
Book value 1,011,643,024.62 - - 1,011,643,024.62 791,414,958.18 - - 791,414,958.18
- 154 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
XIV. NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS -
continued
1. Other receivables - continued
(3) Other receivables - continued
(c) Changes in provision for credit loss of other receivables
Unit: RMB
Stage I Stage II Stage III
Lifetime ECL
Item Lifetime ECL Total
12-month ECL (not credit-
(credit-impaired)
impaired)
Balance at 1 January 2021 - - 383,456.60 383,456.60
Carrying amount of other receivables at 1 January 2021
-- transfer to stage II - - - -
-- transfer to stage III - - - -
-- transfer back to stage II - - - -
-- transfer back to stage I - - - -
Provision for the period - - - -
Reversal - - - -
Transfer out due to
derecognition of financial
- - - -
assets (including direct
write-down)
Other changes - - - -
Balance at 30 June 2021 - - 383,456.60 383,456.60
(d) Other receivables by nature
Unit: RMB
Item Closing balance Opening balance
Amounts due from related parties 1,004,888,834.74 785,752,325.78
Advances 4,402,998.69 3,862,191.69
Others 2,734,647.79 2,183,897.31
Total 1,012,026,481.22 791,798,414.78
Less: Provision for credit loss 383,456.60 383,456.60
Book value 1,011,643,024.62 791,414,958.18
(e) There is no other receivables write-off during this period.
(f) The top three balances of other receivables classified by debtor
Unit: RMB
Proporti on of the Closing bal ance of
Company name Nature Closing bal ance Aging amount to the total provision for
other recei vable (% ) credit loss
Shenzhen Haixing Harbor Loan to related Within 1 year, 2-3
1,002,001,734.69 99.01 -
Develop ment Co., Ltd. parties years
China Merchants International Loan to related
2,887,100.05 Within 1 year 0.29 -
Technology Company Limited parties
China Merchants (Liaoning) Po rt Advance payments Within 1 year , 1-2
2,500,000.00 0.25 -
Develop ment Co., Ltd. for account current years
Total 1,007,388,834.74 99.55 -
- 155 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
XIV. NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS - continued
2. Long-term equity investments
Unit: RMB
Changes for the period
Closing
Reconciling items Announced balance of
Investee 1/1/2021 Inve stment 30/6/2021
from other Other equity distribution of Impairment impairment
Increase Decrease income under Others
comprehensive movements cash dividends provision provision
e quity method
income or profit
I. Subsidiary
Shenzhen Chiwan International Freight Agency Co., Ltd. 5,500,000.00 - - - - - - - - 5,500,000.00 -
Shenzhen Chiwan Harbor Container Co. Ltd. 250,920,000.00 - - - - - - - - 250,920,000.00 -
Shenzhen Chiwan Port Development Co., Ltd. 206,283,811.09 - - - - - - - - 206,283,811.09 -
Chiwan Wharf (Hong Kong) 1,070,000.00 - - - - - - - - 1,070,000.00 -
Shenzhen Chiwan T ugboat Co., Ltd. 24,000,000.00 - - - - - - - - 24,000,000.00 -
Chiwan Container Terminal Co., Ltd. 421,023,199.85 - - - - - - - - 421,023,199.85 -
Dongguan Chiwan Warf Co., Ltd. 186,525,000.00 - - - - - - - - 186,525,000.00 -
Dongguan Chiwan T erminal Co., Ltd. 175,000,000.00 - - - - - - - - 175,000,000.00 -
Chiwan Shipping (Hong Kong) Limited 1,051,789.43 - - - - - - - - 1,051,789.43 -
CMPort (Note 1) 28,272,939,139.99 6,508,125.00 - - - - - - - 28,279,447,264.99 -
China Merchants Port (Zhoushan) RoRo Logistics Co., Ltd. 149,709,800.00 - - - - - - - - 149,709,800.00 -
Zhanjiang port (Note 2) 3,381,825,528.52 - - - - - - - - 3,381,825,528.52 -
China Merchants International Information T echnology -
23,451,570.97 -2,890,495.95 - - - - - - 20,561,075.02
Co., Ltd.
Sub-total 33,075,848,268.88 29,959,695.97 -2,890,495.95 - - - - - - 33,102,917,468.90 -
II. Associate
China Merchants Northeast Asia Development -
1,007,786,285.71 - - 6,331,456.35 - - - - - 1,014,117,742.06
Investment Co., Ltd. (Note 3)
China Merchants Bonded Logistics Co., Ltd. 384,647,157.60 - - 10,012,000.00 394,659,157.60
International Information T echnology Co., Ltd 23,833,710.97 - -1,875,000.00 -385,535.90 -35,889,379.28 - 14,316,222.97 - -18.76 - -
Others 1,500,464,520.87 206,523,799.86 - 52,613,117.10 - - -35,328,355.20 - - 1,724,273,082.63 -
Sub-total 2,916,731,675.15 206,523,799.86 -1,875,000.00 68,571,037.55 -35,889,379.28 - -21,012,132.23 - -18.76 3,133,049,982.29 -
III. Joint venture -
Yantai Port Group Laizhou Port Co., Ltd. 782,832,086.50 - - 16,309,101.16 - - -24,643,441.33 - - 774,497,746.33 -
China Merchants Antong Logistics Management -
9,102,988.02 - - 568,832.67 - - - - - 9,671,820.69
Company
Zhanhang Logistics (Note 3) 452,283,105.00 - - 933,240.00 - - - - - 453,216,345.00 -
Sub-total 1,244,218,179.52 - - 17,811,173.83 - - -24,643,441.33 - - 1,237,385,912.02 -
Total 37,236,798,123.55 236,483,495.83 -4,765,495.95 86,382,211.38 -35,889,379.28 - -45,655,573.56 - -18.76 37,473,353,363.21 -
Note 1: See Note VII. 1 for details.
Note 2: See Note VII. 1 for details.
- 156 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
XIV. NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS -
continued
3. Operating income and operating costs
Unit: RMB
Amount incurred in Amount incurred in
Item the current period the prior period
Revenue Cost Revenue Cost
Principal operating - 1,132,979.75 - 1,132,979.82
Other operating 471,974.86 - 94,339.62 -
Total 471,974.86 1,132,979.75 94,339.62 1,132,979.82
4. Investment income
(1) Details of investment income
Unit: RMB
Amount incurred in Amount incurred in
Item
the current period the prior period
Income from long-term equity investments under cost method 912,418,115.63 1,286,567,145.53
Long-term equity investments income under equity method 86,382,211.38 28,229,153.26
Income from other equity instruments investments 460,000.00 460,000.00
Income from debt investments 6,017,068.48 11,375,616.44
Total 1,005,277,395.49 1,326,631,915.23
(2) Income from long-term equity investments under cost method
Unit: RMB
Amount incurred in Amount incurred in Reason for changes
Investee
the current period the prior period comparing with prior period
Changes in profit distribution
CMPort 652,351,928.94 745,060,561.87
of investee
Shenzhen Chiwan Harbor Container Changes in profit distribution
143,574,378.69 121,071,884.15
Co. Ltd. of investee
Changes in profit distribution
Dongguan Chiwan Terminal Co., Ltd. 48,020,128.82 59,036,979.32
of investee
Changes in profit distribution
Shenzhen Chiwan Tugboat Co., Ltd. 30,409,076.03 25,604,356.23
of investee
Changes in profit distribution
Zhanjiang Port (Group) Co., Ltd 23,395,773.67 -
of investee
Shenzhen Chiwan Port Development Changes in profit distribution
14,577,752.63 -
Co., Ltd. of investee
Shenzhen Chiwan International Freight Changes in profit distribution
89,076.85 245,148.61
Agency Co., Ltd. of investee
Changes in profit distribution
Chiwan Container Terminal Co., Ltd. - 275,313,936.56
of investee
Changes in profit distribution
Dongguan Chiwan Warf Co., Ltd. - 60,234,278.79
of investee
Total 912,418,115.63 1,286,567,145.53
- 157 -
CHINA MERCHANTS PORT GROUP CO., LTD.
SUPPLEMENTARY INFORMATION
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
1. BREAKDOWN OF NON-RECURRING PROFIT OR LOSS
Unit: RMB
Item Amount Remarks
Losses on disposal of non-current assets 4,731,273.76
Tax refunds or reductions with ultra vires approval or without official approval
-
documents
Government grants recognized in profit or loss (except for grants that are closely
related to the Company's business and are in amounts and quantities fixed in 292,333,022.53
accordance with the national standard)
Money lending income earned from non-financial institutions in profit or loss 118,821,999.88
The excess of attributable fair value of identifiable net assets over the
-
consideration paid for subsidiaries, associates and joint ventures
Gains or losses on exchange of non-monetary assets -
Gains or losses on entrusted investments or assets management -
Provision of impairment losses for each asset due to force majeure, e.g. natural
-
disasters
Gains or losses on debt restructuring -
Business restructuring expenses, e.g., expenditure for layoff of employees,
-
integration expenses, etc.
Gains or losses relating to the unfair portion in transactions with unfair
-
transaction price
Net profit or loss of subsidiaries recognized as a result of business combination
of enterprises under common control from the beginning of the period up to -3,255,790.50
the business combination date
Gains or losses arising from contingencies other than those related to normal
-
operating business
Gains from changes of fair value of held-for-trading financial assets, derivative
financial assets, other non-current financial assets, held-for-trading financial
liabilities, derivative financial liabilities other than effective hedging operation
-488,532,866.45
relating to the Company's normal operations, and the investment income from
disposal of the above held-for-trading financial assets/financial liabilities and
other debt investments
Reversal of provision for accounts receivable that are tested for credit loss
94,099.17
individually
Gains or losses on entrusted loans -
Gains or losses on changes in the fair value of investment properties that are
-
subsequently measured using the fair value model
Effects on profit or loss of one-off adjustment to profit or loss for the period
-
according to the requirements by tax laws and accounting laws and regulations
Custodian fees earned from entrusted operation 471,698.11
Other non-operating income or expenses other than above 19,007,039.27
Other profit or loss that meets the definition of non-recurring profit or loss (Note) -
Tax effects 74,697,555.98
Effects of minority interest (after tax) 13,971,253.45
Total 32,339,285.20
CHINA MERCHANTS PORT GROUP CO., LTD.
SUPPLEMENTARY INFORMATION
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2021
2. RETURN ON NET ASSETS AND EARNINGS PER SHARE ("EPS")
The return on net assets and EPS have been prepared by Shenzhen Chiwan Wharf Co., Ltd. in accordance
with Information Disclosure and Presentation Rules for Companies Making Public Offering No. 9 -
Calculation and Disclosure of Return on Net Assets and Earnings per Share (revised in 2010) issued by
China Securities Regulatory Commission.
Unit: RMB
Weighted EPS
Item average return
Basic EPS Diluted EPS
on net assets (%)
Net profit attributable to ordinary shareholders 4.4252 0.8724 0.8724
Net profit attributable to ordinary shareholders after
4.3383 0.8556 0.8556
deducting non-recurring profit or loss
