Section I Important Notice, Contents and Definitions
The Board of Directors and the Board of Supervisors of the Company and its directors,
supervisors and senior management warrant that the information contained in this semi-annual
report is true, accurate and complete without any false and misleading statements or material
omissions, and severally and jointly accept legal liability thereof.
Liu Peng, the person in charge of the Company, Dong Ye, the person in charge of accounting of
the Company, and Xu Xianjing, the person in charge of the accounting department of the
Company, have declared that they warrant the truthfulness, accuracy and completeness of the
financial statements set out in this semi-annual report.
All directors of the Company attended the Board meeting on which this report was reviewed.
Discrepancies in the sum of decimals in this report are caused by rounding.
The forward-looking statements in this report, including future plans and development
strategies, do not constitute substantive commitments of the Company to investors. Investors
should be aware of the investment risks.
The Company has described potential risk factors and countermeasures that may exist in its
operations in detail in Section III Discussion and Analysis of the Management and Section X
Risks Faced by the Company and Countermeasures. Investors are advised to pay attention to
the relevant contents.
The Company plans not to distribute cash dividend, issue bonus share, or transfer capital
reserve into share capital.
Contents
Section I Important Notice, Contents and Definitions ......................................................................................... 2
Section II Company Profile and Key Financial Indicators .................................................................................. 6
Section III Discussion and Analysis of the Management ..................................................................................... 9
Section IV Corporate Governance ....................................................................................................................... 27
Section V Environmental and Social Responsibilities ........................................................................................ 30
Section VI Significant Events ............................................................................................................................... 36
Section VII Changes in Shareholding and Information of Shareholders ......................................................... 46
Section VIII Particulars of Preference Shares .................................................................................................... 55
Section IX Corporate Bonds ................................................................................................................................. 56
Section X Financial Report ................................................................................................................................... 57
Documents Available for Inspection
1. The Semi-annual Report 2023 affixed with the signature of the Company’s legal representative.
2. Financial statements affixed with the signatures and stamps of the legal representative of the
Company, person in charge of accounting, and person in charge of accounting department of the
Company.
3. All original copies of the Company’s documents and the original drafts of the Company’s
announcements as disclosed during the reporting period.
4. Place for document inspection: Office of the Board of Directors.
Terms and Definitions
Term Definition
The Company, Company, C&S C&S Paper Co., Ltd.
Zhongshun Group Guangdong Zhongshun Paper Group Co., Ltd.
Chung Shun Co. Chung Shun Co., a Hong Kong-based company
Zhongshan Trading Zhongshan Zhongshun Trading Co., Ltd.
Zhong Shun International Zhong Shun International Co., Ltd., a Hong Kong-based company
C&S Hong Kong C&S Hong Kong Co., Ltd., a Hong Kong-based company
Macao C&S C&S (Macao) Co., Ltd.
Beijing Trading Beijing C&S Paper Co., Ltd.
Xiaogan Trading Xiaogan C&S Trading Co., Ltd.
Chengdu Trading Chengdu Zhongshun Paper Co., Ltd.
Hangzhou Trading Hangzhou Jie Rou Trading Co., Ltd.
Shanghai Trading Shanghai Huicong Paper Co., Ltd.
Yunfu Hengtai Trading Co., Ltd., formerly known as C&S (Yunfu)
Yunfu Trading
Trading Co., Ltd.
C&S (Sichuan) Paper Co., Ltd., formerly known as Chengdu Tiantian
Sichuan C&S
Paper Co., Ltd.
Jiangmen C&S Jiangmen Zhongshun Paper Co., Ltd.
Zhejiang C&S Zhejiang Zhongshun Paper Co., Ltd.
C&S (Hubei) Paper Co., Ltd., formerly known as Hubei Zhongshun
Hubei C&S
Hongchang Paper Co., Ltd.
Yunfu C&S C&S (Yunfu) Paper Co., Ltd.
Tangshan C&S, Tangshan
C&S Paper Co., Ltd. Tangshan Branch
subsidiary
Dazhou C&S C&S (Dazhou) Paper Co., Ltd.
Jiangsu C&S C&S (Jiangsu) Paper Co., Ltd.
C&S (Zhongshan) Paper Co., Ltd., formerly known as Zhongshan Tongfu
Zhongshan Paper
Trade Co., Ltd.
Sun C&S Sun Daily Necessities Co., Ltd.
Dolemi Dolemi Sanitary Products Co., Ltd.
Zhengzhou Dolemi Zhengzhou Dolemi Sanitary Products Co., Ltd.
Xi’an Dolemi Xi’an Dolemi Sanitary Products Co., Ltd.
Bloomage Jierou Beijing Bloomage Jierou Biotechnology Co., Ltd.
Zhongshun Health Zhongshun Health Life Technology (Shenzhen)Co.,Ltd.
Huashun Technology Guangdong Huashun Material Technology Co., Ltd
Quxian Jiezhu Quxian Jiezhu Construction and Development Co., Ltd
Laotongxue Guangdong Laotongxue Information Technology Co., Ltd
Mazars Mazars Certified Public Accountants (LLP)
C&S Paper Co., Ltd. Semi-annual Report 2023
Section II Company Profile and Key Financial Indicators
I. Company Profile
Stock name C&S Stock code 002511
Stock exchange on which the shares are listed Shenzhen Stock Exchange
Chinese name of the Company 中顺洁柔纸业股份有限公司
Abbreviation of Chinese name of the Company (if any) 中顺洁柔
English name of the Company (if any) C&S Paper Co., Ltd.
Abbreviation of English name of the company (if any) C&S
Legal representative of the Company Liu Peng
II. Contact Persons and Contact Methods
Sectary to the Board Representative of securities affairs
Name Zhang Haijun Zhang Xia
No. 136 Caihong Avenue, West District, No. 136 Caihong Avenue, West District,
Address
Zhongshan City Zhongshan City
Tel 0760-87885678 0760-87885678
Fax 0760-87885669 0760-87885669
Email dsh@zsjr.com dsh@zsjr.com
III. Other Information
1. Contact information of the Company
Whether there are changes in the Company’s registered address, office address and postal code, website, and email
address during the reporting period
□ Applicable √ Not applicable
The registered and office addresses and their post codes, official website, and email of the Company were not
changed during the reporting period. See the Annual Report 2022 for details.
2. Information disclosure and location for inspection of documents
Where there are changes in information disclosure and location for inspection of documents during the reporting
period
□ Applicable √ Not applicable
There are no changes in the name of the newspaper selected by the Company for information disclosure, website
designated by CSRC for publicizing the semi-annual report, and the location for inspection of the semi-annual report
during the reporting period. Please refer to the Annual Report 2022 for details.
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C&S Paper Co., Ltd. Semi-annual Report 2023
3. Other Relevant Information
Where there are changes in other relevant information
□ Applicable √ Not applicable
IV. Main Accounting Data and Financial Indicators
Whether the Company needs to perform retrospective adjustment or restatement of accounting data for previous
years
□ Yes √ No
Same period of previous Changes over same period of
Current period
year previous year
Operating income (RMB) 4,685,080,565.59 4,367,618,113.61 7.27%
Net profit attributable to shareholders of
84,490,174.46 227,639,705.35 -62.88%
the listed company (RMB)
Net profit attributable to shareholders of
the listed company after deducting non- 73,693,887.58 220,565,031.66 -66.59%
recurring profit and loss (RMB)
Net cash flow from operating activities
773,446,258.06 699,549,725.75 10.56%
(RMB)
Basic earnings per share (RMB/share) 0.06 0.17 -64.71%
Diluted earnings per share (RMB/share) 0.06 0.17 -64.71%
Weighted average return on net assets 1.61% 4.53% -2.92%
Changes over end of previous
End of current period End of previous year
year
Total assets (RMB) 8,914,091,494.79 8,335,107,691.71 6.95%
Net assets attributable to shareholders of
the listed company (RMB) 5,217,274,700.43 5,178,060,378.48 0.76%
V. Difference in Accounting Data under Domestic and International Accounting Standards
1. Net profit and net asset differences under International Financial Reporting Standards (IFRS) and Chinese
Accounting Standards (CAS)
□ Applicable √ Not applicable
No such differences for the reporting period
2. Net profit and net asset differences under foreign accounting standards and Chinese Accounting Standards
(CAS)
□ Applicable √ Not applicable
No such differences for the reporting period
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C&S Paper Co., Ltd. Semi-annual Report 2023
VI. Non-recurring Items and Amounts
√ Applicable □ Not applicable
Unit: RMB
Item Amount Description
Profits/losses from the disposal of non-current asset (including the write-off that
-2,960,777.02
accrued for impairment of assets)
Governmental grants reckoned into current profits/losses (not including grants
enjoyed in quota or ration according to national standards, which are closely relevant 11,874,320.21
to the company’s normal business)
Profits/losses from assets entrusted to others for investment or management 990,155.36
Except for effective hedging business related to the normal operation of the
company, fair value gains and losses from holding trading financial assets and
968,000.00
trading financial liabilities, as well as investment income from disposing of trading
financial assets, trading financial liabilities, and available for sale financial assets
Other non-operating income and expenses except for the aforementioned items 2,680,646.89
Less: Influence of income tax 2,756,058.56
Total 10,796,286.88
Details of other profit and loss items that meet the definition of non-recurring profit and loss:
□ Applicable √ Not applicable
The Company has no other profit and loss items that meet the definition of non-recurring profit and loss.
Descriptions where the Company defines any non-recurring profit and loss items listed in the No. 1 Explanatory
Announcement on Information Disclosure of Companies Offering Securities to the Public—Non-recurring Profit
and Loss as recurring profit and loss items during the reporting period
□ Applicable √ Not applicable
The Company did not define any non-recurring profit and loss items listed in the No. 1 Explanatory
Announcement on Information Disclosure of Companies Offering Securities to the Public—Non-recurring Profit
and Loss as recurring profit and loss items during the reporting period.
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C&S Paper Co., Ltd. Semi-annual Report 2023
Section III Discussion and Analysis of the Management
I. Principal Businesses of the Company during the Reporting Period
Main Products
Mr. Deng Yingzhong, founder of the Company, initiated his entrepreneurial process in 1979. Starting from intensive
paper processing, the Company has developed into a diversified group company integrating R&D, production and
sales after forty plus years of striving. It is among the first batch of household paper companies listed on China A-
shares. The Company, with an adherence to the business philosophy of “building product, enterprise and
professional brands”, practices the “All We Care Is You” value proposition and continues to provide consumers with
healthy, safe, environmental-friendly, comfortable and convenient products and services.
Currently the Company features three major brands, namely C&S, Sun and Dolemi. Main products include toilet
paper, facial tissues, paper handkerchiefs, napkins, wet wipes, kitchen tissues, personal care products (sanitary pads),
facial towels, etc. Specifics are given in the following:
(I) Household paper
Lotion series: Specially developed for female and infant consumers, the products contain moisturizing cream. With
selected high-quality 100% virgin wood pulp and quality moisturizing cream, the paper is soft, delicate and smooth.
It is the professional moisturizing facial tissue brand trusted by consumers.
Face series: Face series are soft, delicate and pliable. Being wettable, the products can be used as face towels.
Among them, the oil painting series combine quality and artistry and are therefore praised as “artwork of paper
tissues”.
Cotton Series: Soft like cloud, the series adopt new air cushion technologies. After multiple times of independent
embossing, there form countless light and small air cushions inside, making the tissue thicker, softer and more skin-
friendly. Using pure physical compound techniques, the products feature beautiful embossing while giving a soft,
cotton-like touch.
Gilt Series: As a high-end tissue line, the series were launched in 2023, with both exquisite interior and exterior.
The appearance is the work of a well-known design master. The black and gilt colors have a luxurious texture,
giving a high-quality feeling and appealing to the eyes of consumers.
Sun series: Preferred raw material. Targeting at the youth market, the brand serves as a powerful supplement to the
Company’s primary brand “C&S”.
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C&S Paper Co., Ltd. Semi-annual Report 2023
Kitchen towel series: Using 100% virgin wood pulp, the kitchen paper towels boast stronger oil-absorption and
water-absorption power and are up to the EU and U.S. Requirements for food contact material testing, thereby better
satisfying the multi-functional wiping needs of households. Meanwhile, the kitchen wet wipes boast expedite
decontamination power without hurting hands. Cloth is super absorbent without leaving marks, strong oil removal
without locking oil.
Quick Dissolving and Easy to Pull Toilet Paper Series: As toilet paper in tissue boxes, the series are designed for
people who pursue a quality life. Consumers can pull out the paper easily with one hand. In addition, the products,
selecting 100% virgin wood pulp, dissolve easily and hence do not block the toilet. Being hygienic, clean and not
easy to be affected by moisture, the series can address the needs of delicate people in the toilet scenario.
(II) Personal care products
The Company launched the new VI series for Dolemi pads in 2022, which includes two product series of True
Suction and Zero Feeling. The products are available through all channels to achieve omni retail. In addition, the
Company upgraded the Fantasy Maiden series to enhance the Dolemi brand.
(III) Quality health products
Clean and Soft Cleansing Towel Series: Dedicated to skin care, the products select quality plant fibers with
upgraded processes. They feature double-sided texture design, with one side for cleaning and one side for skin care,
thereby giving the skin a new and comfortable cleansing experience.
Ultra Soft Face Towel Series: Teaming up with world-renowned quality fiber manufacturers, the series
carefully select quality plant fibers imported from Brazil and Indonesia. Targeting Gen Z female users for the
removal of makeups, the silk-like face towels are soft, thick, instant absorbent, resilient and washable. The
products have passed third-party skin irritation tests with supreme care for the skin. Co-branded with cutting-
edge artistic IPs, the series feature appealing pop art packaging, which could help increase the awareness and
exposure of the brands and products.
Business travel series: With the change of lifestyle, the Company understands that people are increasingly
concerned about the hygiene problem during business travels. In view of this, it has developed the business travel
series such as disposable compressed towels, rinse-free antibacterial hand sanitizers, alcohol sanitary pads, etc.
These products are easy to carry, clean and hygienic and can guard the health of consumers anytime, anywhere.
Among them, disposable compressed towels, disposable bath towels, etc. are made of plant fibers that are natural,
environmental friendly and degradable. They really make travel easy.
Basic Wet Wipe Series: The products can address the pain points of different groups of people and different
purposes and can be used in various scenarios such as before or after meal, during trips, after exercise, outdoor, etc.
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C&S Paper Co., Ltd. Semi-annual Report 2023
The plasma pure water is filtered by 8 processes, so it is skin-friendly and non-irritating. The products can remove
the sickness feeling of the skin and keep the skin clean and healthy.
Disinfection Wet Wipe Series: With 99.9% sterilization rate with physical sterilization, the products are skin-
friendly so that consumers can enjoy a healthy life. By adopting face-care grade fabric, the products can create a
safe and comfortable environment for the skin.
Maternal and Infant Wet Wipe Series: Along with the change of seasons, the Company finds that mothers become
more and more concerned about the hygiene problem of infants and children when going out. As a result, the
Company developed the hand and mouth cleansing wipes for babies. With the non-toxic and non-irritating formula,
moms can feel assured about the safety of their children.
Wet Toilet Paper Series: To address the pain points of users for the pursuit of comfort when going to the toilet,
the Company launched the series to solve the issue from multiple dimensions on the basis of ensuring
cleanliness. Products include wet toilet paper that has a sterilization rate of 99.9%, wet toilet paper specially
designed for female, wet toilet paper cross-branded with MAYINGLONG PHARM for special care in the toilet
scenario, etc. The series allow consumers to have a refreshing and comfortable feeling while going to the toilet.
(IV) Commercial channel products
Commercial channel products are also constantly upgraded and enriched along with market changes. In
addition to paper towels, small plate paper and napkins for traditional scenarios such as property cleaning,
restaurants and hotels, and high-traffic places, the Company also added series of products and supporting
peripherals such as toilet fragrances, hand sanitizers, disposable towels and bath towels and compressed towels.
Moreover, the Company is developing multi-functional paper towels. By focusing on optimizing customer
experience and meeting customer demands, the Company will continue to introduce cleaning and sanitation
products with higher quality. Considering the increasing needs of government departments, pubic institutions
and enterprises for daily necessities as welfare to employees, the Company also launched differentiated group-
buying products through online and offline channels, to meet market demands in an all-round manner.
Development Trends of the Industry
The household paper industry to which the Company belongs has maintained an upward trend in recent years,
with room for continued growth in the long run. The wood pulp, which is the main raw material of the
Company’s products, relies highly on import. Affected by various factors, the price of imported pulp hit a new
high in 2022. Coupled with rising energy prices, the production costs of household paper companies rose
significantly. Therefore, the Company faced enormous operating pressure. As the pulp price has been
demonstrating a downward trend in the first half of 2023, the pressure of production costs will gradually ease.
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C&S Paper Co., Ltd. Semi-annual Report 2023
The competition in China’s household paper industry is still fierce and industry concentration will be further
strengthened. With enhanced awareness on the concept of healthy living, consumers pay increasing attention to
brands. Product quality is still a prominent concern in the industry.
Market Position
The Company has become one of the representative brands of high-end household paper in the market through
continuous brand building and quality assurance as well as robust production capacity layout and channel expansion.
It is ranked among the first echelon in the household paper industry and is well recognized by consumers and the
market. In addition, with an adherence to the value concept of “All We Care Is You”, the Company continues to tap
consumer needs and constantly upgrades and optimizes products with leverage on its strong R&D and innovation
capabilities. The Company is committed to providing consumers with products of better quality, more comfort, and
more tailored to their individual needs. The Company aims to achieve national product coverage which is
underpinned by continuously improving product reputation among consumes and consolidating brand awareness.
Key Performance Drivers
The Company always adheres to its core strategies and business objectives, and strives to promote the growth of
revenue and the sales of high-end, high-margin products by continuously optimizing product categories, adjusting
and refining channels, and stepping up efforts for key products. During the reporting period, the Company recorded
total revenue of RMB 4,685,080,565.59, up by 7.27%. Under the influence of high-priced pulp inventory and rising
energy prices, production costs of the Company rose sharply compared to the same period of the previous year.
Coupled with factors such as fierce market competition, the gross profit margin also declined year-on-year.
Moreover, the implementation of the 2022 Stock Option and Restricted Stock Incentive Plan increased the
amortization of incentive costs, while the Company also increased R&D investments. During the reporting period,
the Company posted a net profit attributable to shareholders of the listed company of RMB 84,490,174.46, a YoY
decrease of 62.88%.
The price of imported pulp hit a record high again in 2022. As the pulp price has been demonstrating a downward
trend in the first half of 2023, the pressure of production costs has been gradually eased. In the future, the Company
will continue to adhere to its development strategies and business plans, i.e. driving the continuous growth of high-
end, high-margin products, improving IT and digital construction, refining management, increasing revenue and
reducing expenditure, and reducing costs and increasing efficiency. All these will help lay the foundation for the
Company’s long-term healthy development.
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C&S Paper Co., Ltd. Semi-annual Report 2023
II. Analysis of Core Competitiveness
1. Belonging to the first echelon of the domestic household paper industry
The Company is a top-performing enterprise in the first echelon of the domestic household paper industry with
products available at all channels and both at home and abroad. In addition, it actively taps overseas markets
including Southeast Asia, Northeast Asia, Oceania and North America. According to the 2022 China Consumer
Satisfaction Index for Household Paper prepared by the third-party agency CHNBRAND, C&S has ranked the first
for three consecutive years.
2. Constantly optimized product structure and continuously improved product competitiveness
As consumers pay more attention to own health protection, the demand for household paper takes on a differentiated
and high-end trend. The Company quickly grasped the market changes and introduced the antibacterial series of
non-traditional dry towel products such as wet wipes, wet toilet paper, and portable products for business and travel
in various usage scenarios.
The Company continued to optimize product structure and has positioned high-end, high-margin non-traditional dry
wipes as a strategic category that will be prioritized in the future. Efforts have been stepped up for the terminal sales
of the Oil Painting, Koi Fish, Face, Lotion and other high-end, high-margin series. Precise brand marketing strategy
combined with multi-channel sales layout will help improve the distribution and penetration of high-end, high-
margin products, drive the growth of their shares, and hence steadily improve the profit margin and profitability of
the company.
3. Professional and effective management team
The R&D, production, procurement, quality control, marketing and sales teams have successively introduced
excellent professionals since 2014. At present, the Company boasts the most outstanding R&D, production,
branding and marketing teams in the industry. As such, its new product R&D, product quality, branding, sales and
marketing have been effectively solidified. Most of the mid-level and high-level managers of the marketing team
are core, backbone employees who have served in the Company for more than five years, with high sense of loyalty
and strong professional competence. They can lead sales teams to work hard according to the strategic goals of the
Company and promote the healthy and stable development of various business indicators. The management team
of the Company has formulated long-term and strategic plans in line with actual situation of the Company, industry
development level, and market demands. Moreover, the management team is capable of making reasonable
decisions on operation management issues with relation to R&D, production, marketing, investment and financing,
and effectively implementing such decisions. The excellent management team fundamentally guarantees the
Company’s competitiveness and sustainable development in the future.
4. Nationwide marketing network
The Company has been building and improving its marketing networks with reasonable layout based on its keen
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C&S Paper Co., Ltd. Semi-annual Report 2023
and strategic insights. It has guaranteed its profitability by expanding its channels from a single dealer channel in
2015 to five channels at present, i.e. GT (General Trade), KA (Key Account), AFH (Away From Home), EC (E-
Commerce), and RC (Retail Consumer). Its current marketing network covers most of the prefecture-level (and
county-level) cities. Products are directly sold to counties and then distributed to towns. This helps achieve
segmented and flat market operation and expand the dealer network.
Additionally, while ensuring the smooth operation of other channels, the Company has established a professional e-
commerce operation team, devoted more resources to e-commerce platforms, built and strengthened the
corresponding supply chain system, and intensified its routine operation management. At present, it has cemented
long-term strategic cooperation with mainstream well-known platforms. The Company has strengthened the layout
of emerging business models such as new retail, O2O and content marketing, while efforts have been stepped up
for livestream shopping and community group buying. In addition, it has developed an AFH service team for AFH
channels and customer bases to match the growing AFH market. In response to the market changes of modern KA
channels, the Company actively adjusts strategies and strives to improve efficiency and effectiveness of resource
inputs.
Attributable to a robust sales network plus quality and diversified products, the Company is able to constantly
consolidate its market basis, improve consumer experience, and enhance brand reputation, which can help achieve
sustainable and stable growth in the future.
5. Nationwide layout of production bases
The Company has developed a production layout covering East China, South China, West China, North China, and
Central China, through its subsidiaries including Jiangmen C&S, Yunfu C&S, Sichuan C&S, Zhejiang C&S, Hubei
C&S, Tangshan Subsidiary and Dazhou C&S (under construction, not yet in production). Thanks to the nationwide
layout of production bases, the Company has narrowed the distance to customers, reduced transportation costs, and
enhanced transportation efficiency.
6. Product quality at an international level
The Company has always regarded product quality as its lifeline of survival and development ever since its
incorporation. First-class quality derives from first-class raw materials. The Company has implemented strict
incoming quality control (IQC) procedures for raw materials to control the hygiene and quality of products from
the source. Moreover, manufacturing companies have passed the ISO9001 quality management system certification
and have set up the strictest inspection system for product quality. They have also adopted advanced processes,
formulas, and control procedures in production to effectively guarantee technical indicators.
7. Good R&D capabilities
The Company is equipped with a complete product development system and the R&D department boasts strong
independent R&D capabilities and excellent product formula technologies. In recent years, the Company has
continuously upgraded and optimized its products, in a bid to provide consumers with products that are of better
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C&S Paper Co., Ltd. Semi-annual Report 2023
quality, more comfortable and more aligned with their individual needs. Products of the Company have extended
from household paper to cross-category household daily necessities including cleansing towel series, sanitary wipes,
baby diapers, etc. The Company’s speed of bringing forth new products is at the forefront of the industry.
8. Advanced production equipment
The Company drives development with technological progress and has introduced advanced papermaking
equipment and processing equipment from Austria, Germany, Italy, Japan and other countries. The diversified
equipment can produce a variety of products that can meet the differentiated needs of consumers. As a first-tier
enterprise, the Company occupies a leading position in the industry when it comes to the scale and automation of
production equipment. Advanced technology and highly automated equipment have strengthened the Company’s
efficiency, further satisfied ever-growing market demands, and served as an unstoppable driving force to
development.
9. Outstanding environmental protection awareness and technology
Along with the deepening of industrialization, the concept of environmental protection has been deeply rooted
among the people. The Company has adhered to the concept of "seeking green benefits and fulfilling corporate
social responsibilities", and utilized advanced environmental protection technologies to pursue its objective of
environmental protection. Its waste water and gas emissions are superior to the national standards. The Company
actively fulfills its corporate social responsibilities and actively responds to China’s strategic goals of “carbon
peaking” and “carbon neutrality” by fully supporting and enforcing various environmental protection requirements
of the government. In the future, the advantages and anti-risk capabilities of C&S in energy conservation and
emission reduction will be further highlighted.
III. Analysis of Principal Businesses
Overview
Please refer to relevant contents in “I. Principal Businesses of the Company during the Reporting Period”.
YoY changes in major financial data
Unit: RMB
Same period of YoY
Current period Reason of change
previous year changes
Operating income 4,685,080,565.59 4,367,618,113.61 7.27%
Operating cost 3,352,956,520.74 2,929,313,606.05 14.46%
Selling expenses 937,125,533.37 874,040,563.35 7.22%
Administrative
188,774,711.51 180,176,434.40 4.77%
expenses
Finance expenses: This item recorded a decrease of
- RMB 15,003,734.08 or 1,022.71% in the reporting
Finance expenses -16,470,784.30 -1,467,050.22 1,022.71 period compared with the same period of 2022,
% mainly due to the decrease in gains and losses on
exchange during this reporting period.
Income tax -1,857,299.09 33,733,447.46 -105.51% Income tax expenses: This item recorded a
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C&S Paper Co., Ltd. Semi-annual Report 2023
expenses decrease of RMB 35,590,746.55 or 105.51% in the
reporting period compared with the same period of
2022, mainly due to the decrease in total profit
during this reporting period.
R&D investment 120,281,401.12 105,182,287.61 14.36%
Net cash flow
from operating 773,446,258.06 699,549,725.75 10.56%
activities
Net cash flow from investing activities: This item
recorded a decrease of RMB 764,254,994.73 or
Net cash flow
308.45% in the reporting period compared with the
from investing -1,012,025,728.54 -247,770,733.81 -308.45%
activities same period of 2022, mainly due to the increase in
principal paid for purchasing financial products
during this reporting period.
Net cash flow from financing activities: This item
recorded an increase of RMB 560,134,193.28 or
Net cash flow
1,052.52 1052.52% in the reporting period compared with
from financing 613,352,827.68 53,218,634.40
% the same period of 2022, mainly due to an increase
activities
in cash received from borrowings during this
reporting period.
Net increase in
cash and cash 401,022,115.70 517,377,489.31 -22.49%
equivalents
Whether there are significant changes in the profit composition or source of profits of the Company during the
reporting period
□ Applicable √ Not applicable
There were no significant changes in the profit composition or source of profits of the Company during the reporting
period.
Composition of operating income
Unit: RMB
Current period Same period of previous year
Proportion in Proportion in YoY changes
Amount Amount
operating income operating income
Total operating
4,685,080,565.59 100% 4,367,618,113.61 100% 7.27%
income
By industry
Household paper 4,623,891,020.45 98.69% 4,310,541,117.61 98.69% 7.27%
Personal care and
61,189,545.14 1.31% 57,076,996.00 1.31% 7.21%
others
By product
Finished products 4,605,804,022.70 98.31% 4,268,648,501.31 97.73% 7.90%
Semi-finished
79,276,542.89 1.69% 98,969,612.30 2.27% -19.90%
products
By region
Domestic 4,589,885,969.35 97.97% 4,269,777,280.85 97.76% 7.50%
Overseas 95,194,596.24 2.03% 97,840,832.76 2.24% -2.70%
Industries, products, or regions that accounted for over 10% of the Company’s operating income or operating
profit
√ Applicable □ Not applicable
Unit: RMB
Operating income Operating cost Gross YoY changes YoY changes of YoY changes of
16
C&S Paper Co., Ltd. Semi-annual Report 2023
profit of operating operating cost operating gross
margin income profit margin
By industry
Household
4,623,891,020.45 3,316,391,889.48 28.28% 7.27% 14.82% -4.71%
paper
By product
Finished
4,605,804,022.70 3,276,082,027.19 28.87% 7.90% 15.32% -4.58%
products
By industry
Household
4,589,885,969.35 3,281,461,615.63 28.51% 7.50% 14.52% -4.38%
paper
Where the statistical standards for the Company’s principal business data were adjusted in the reporting period,
whether principal business data of the Company in the recent period were adjusted as per statistical standards at the
end of the reporting period
□ Applicable √ Not applicable
IV. Analysis of Non-principal Businesses
√ Applicable □ Not applicable
Unit: RMB
Proportion in Is it consistently
Amount Explanation of reason
total profit applied?
Mainly for the purchase of forward settlement
Investment income 1,958,155.36 2.39% and sales of foreign exchange, and the maturity No
income of financial products
Asset impairment -1,417,159.06 -1.73% Provision for impairment of inventories No
Non-operating income 3,592,734.66 4.38% Income from fine and compensation and others No
Losses from damage and scrapping of fixed
Non-operating expense 3,821,260.22 4.65% No
assets and others
Credit impairment Provision for bad debts of accounts receivable
-1,764,899.61 -2.15% No
losses and other receivables
V. Analysis of Assets and Liabilities
1. Significant changes in the composition of assets
Unit: RMB
End of current period End of previous year Explanation of
Proportion
Proportion Proportion significant changes
changes
Amount in total Amount in total Proportion in total
Amount
assets assets assets
Monetary funds 1,720,158,431.51 19.30% 1,324,787,541.49 15.89% 3.41%
Accounts
1,173,731,203.91 13.17% 1,084,130,138.51 13.01% 0.16%
receivable
Inventory: This item
recorded a decrease of
RMB670,487,747.95 or
Inventory 1,241,142,975.60 13.92% 1,911,630,723.55 22.93% -9.01% 35.07% in the reporting
period compared with
the end of 2022, mainly
owing to the decrease in
17
C&S Paper Co., Ltd. Semi-annual Report 2023
raw material during the
reporting period.
Investment
30,983,155.44 0.35% 31,701,597.54 0.38% -0.03%
property
Fixed assets 2,848,133,013.46 31.95% 3,013,559,312.97 36.16% -4.21%
Construction
work in 167,569,837.60 1.88% 142,627,123.42 1.71% 0.17%
progress
Right-of-use assets:
This item recorded an
increase of RMB
6,054,325.19 or 62.04%
in the reporting period
Right-of-use
15,812,608.61 0.18% 9,758,283.42 0.12% 0.06% compared with the end
assets
of 2022, mainly owing
to the increase in lease
contracts under the new
leasing standards during
the reporting period.
Short-term borrowing:
This item recorded an
increase of RMB
558,498,052.40 or
91.89% in the reporting
Short-term
1,166,297,275.02 13.08% 607,799,222.62 7.29% 5.79% period compared with
borrowing
the end of 2022, mainly
owing to the increase in
short-term loans from
bank during the
reporting period.
Contract liabilities: This
item recorded a
decrease of RMB
40,728,360.29 or
42.17% in the reporting
Contract
55,853,584.65 0.63% 96,581,944.94 1.16% -0.53% period compared with
liabilities
the end of 2022, mainly
owing to the decrease in
advances received from
customers during the
reporting period.
Lease liabilities: This
item recorded an
increase of RMB 7,
871,187.64 or 979.15%
in the reporting period
Lease liabilities 8,675,066.94 0.10% 803,879.30 0.01% 0.09% compared with the end
of 2022, mainly owing
to the increase in rented
houses and buildings
during the reporting
period.
2. Main overseas assets
□ Applicable √ Not applicable
18
C&S Paper Co., Ltd. Semi-annual Report 2023
3. Assets and liabilities measured at fair value
□ Applicable √ Not applicable
4. Restriction of asset rights as at the end of the reporting period
Item Book value at the end of the period (RMB) Reason for restriction
Monetary funds 70,238,291.22 Security deposits for issuing letter of credit and notes
Total 70,238,291.22
VI. Analysis of Investment
1. Overview
√ Applicable □ Not applicable
Investment amount during the reporting Investment amount of previous year
Changes
period (RMB) (RMB)
1,108,556,413.00 298,095,067.10 271.88%
2. Major equity investment during the reporting period
□ Applicable √ Not applicable
3. Major non-equity investment during the reporting period
□ Applicable √ Not applicable
4. Financial asset investment
(1) Security investment
□ Applicable √ Not applicable
The Company did not invest in securities during the reporting period.
(2) Derivative investment
√ Applicable □ Not applicable
1） Derivatives investments for hedging purposes during the reporting period
√ Applicable □ Not applicable
Unit: RMB10,000
Type Initial Profit or loss from Accumu Amount Amount Investment Proportion of the
19
C&S Paper Co., Ltd. Semi-annual Report 2023
investm changes in fair lated bought sold amount at the end investment
ent value of the changes in during of the period amount at the end
amount period in fair during the of the period in
value the period the Company’s net
included period assets at the end of
in equity the period
Structural Forward Exchange Purchase 5,428 96.8 0 5,428 5,428 0 0.00%
Total 5,428 96.8 0 5,428 5,428 0 0.00%
Whether there are significant changes to
the accounting policies and specific
accounting principles for derivatives None
during the reporting period compared
with previous reporting period
Explanation on actual profit or loss The Company’s forward foreign exchange sale and purchase business recorded an actual profit
during the period of RMB968,000 during the reporting period.
To avoid the exchange rate and interest rate risks faced in daily operations, the company hedges
its actual risk exposure by operating financial derivatives. The gains and losses of financial
Explanation on the effects of hedging
derivative contracts to some extent hedge the value changes of assets or liabilities caused by
changes in exchange rates and interest rates, and the overall hedging effect meets expectations.
Source of fund Self-owned fund
Risk analysis:
1. Price fluctuation risk: Price fluctuations of underlying interest rates and exchange rates may
lead to price changes of the financial derivatives, thereby causing losses;
2. Internal control risk: Derivative trading is highly specialized and complicated, which may
result in risks arising from poor internal control;
3. Liquidity risk: Transaction may become unable to be completed due to insufficient market
liquidity;
4. Performance risk: The derivative contract may become unable to be fulfilled at maturity,
thereby leading to default risk;
5. Legal risk: Relevant laws and regulations may be changed or the counterparty may violate
Risk analysis and control measures of
relevant laws and regulations such that the contract cannot be normally executed, causing
derivative positions during the reporting
losses to the Company.
period (including but not limited to
market risks, liquidity risks, credit risks,
Control measures:
operational risks and legal risks)
1. Select financial derivatives with strong liquidity and controllable risks for trading;
2. Derivative trading should follow the primary principle of hedging for risks caused by
exchange rate fluctuations to the greatest extent; operation strategies will be adjusted in a
timely manner according to market conditions, to better hedge risks;
3. Carefully choose the counterparty of the derivative trading;
4. Assign specified personnel to continuously monitor the derivative contracts who will report
cases of great market fluctuations or increased risks or significant floating profits or losses to
the management of the Company timely, so as to respond actively;
5. Only conduct derivative trading with qualified financial institutions such as large
commercial risks, to avoid possible legal risks.
Changes in market price or fair value of
invested derivatives during the reporting
period; analysis on fair value of Given that the subject of the Company's hedging transactions is forward foreign exchange
derivatives should disclose the specific settlement, the fair value is determined based on foreign exchange rate.
methods used as well as the setting of
relevant assumptions and parameters
Litigation involved (if applicable) None
Disclosure date of the announcement
regarding the Board’s approval of Novermber 23, 2022
derivative investment (if any)
Opinions of independent directors on the The Company and its subsidiaries use foreign currency to pay for raw material purchases, so
Company’s derivative investment and when the exchange rate fluctuates, exchange gains and losses will have a certain impact on the
risk control Company’s business performance. Therefore, it is reasonable for the Company and subsidiaries
20
C&S Paper Co., Ltd. Semi-annual Report 2023
to use financial tools to hedge exchange rate and interest rate risks. Moreover, the Company
has formulated the Management System on Financial Derivative Trading to effectively regulate
derivative investment and control derivative trading risks. There is no situation that damages
the interests of shareholders of the Company.
2） Derivatives investments for speculative purposes during the reporting period
□ Applicable √ Not applicable
The Company did not engage in any derivatives investments for speculative purposes during the reporting period.
5. Use of raised funds
□ Applicable √ Not applicable
No raised funds were used by the Company during the reporting period.
VII. Major Asset and Equity Sales
1. Sales of major assets
□ Applicable √ Not applicable
The Company did not sell major assets during the reporting period.
2. Sales of major equity
□ Applicable √ Not applicable
21
C&S Paper Co., Ltd. Semi-annual Report 2023
VIII. Analysis of Main Holding and Joint-stock Companies
√ Applicable □ Not applicable
Description of main subsidiaries and of joint-stock companies which have influence on the Company’s net profit by over 10%
Unit: RMB10,000
Company Company Registered Operating Operating
Principal businesses Total assets Net assets Net profit
name type capital income profit
R&D, production, and sales (including online sales): household paper, maternal and infant
products, cosmetics, wipes, non-woven products, daily necessities, and cleaning supplies;
Jiangmen sales (including online sales) of Class I and II medical devices. (The above items do not
Subsidiary 34,598.5032 230,136.91 150,052.68 92,801.89 5,072.93 4,369.52
C&S involve special management measures for the foreign access). (For items that must be
approved in accordance with the law, the company may carry out business operations upon
approval by competent departments.)
R&D, production, wholesale, retail and online sales: household paper, sanitary products,
maternal and infant products, daily necessities, cosmetics, medical devices, sanitary
materials, non-woven fabrics and products, polymer materials and products, daily sundries,
and disinfection supplies (excluding hazardous chemicals); wholesale, retail and online sales:
Yunfu
Subsidiary food; import and export of goods and technologies (excluding the import and export of goods 65,000 268,464.14 126,374.97 170,043.29 6,773.72 5,588.46
C&S
and technologies prohibited by the State or involving administrative approval); warehousing
services (limited to warehouses qualified in fire protection without hazardous chemicals).
(For items that must be approved in accordance with the law, the company may carry out
business operations upon approval by competent departments.)
Licensed items: production of sanitary products and disposable medical supplies; import and
export of goods (for items that must be approved in accordance with the law, the company
may carry out business operations upon approval by competent departments, and the specific
business items are subject to the approval document or the permit issued by relevant
department). General items: sales of sanitary products and disposable medical supplies; sales
Sichuan of personal hygiene products; sales of daily necessities; manufacture of paper products; sales
Subsidiary 10,000 92,485.64 48,751.05 103,220.03 2,512.11 2,044.14
C&S of paper products; manufacture of paper; manufacture of daily chemical products; sales of
daily chemical products; sales of Class II medical devices; sales of Class I medical devices;
manufacture of industrial textile products; sales of industrial textile products; manufacture of
maternal and infant products; sales of maternal and infant products. (The company may carry
out business operations independently according to the law based on the business license,
except for items that must be licensed according to the law.)
Hubei General items: manufacture of paper; manufacture of paper products; sales of paper
Subsidiary 20,000 177,784.67 46,472.72 119,295.28 5,063.22 3,780.53
C&S products; sales of sanitary products and disposable medical supplies; retail of cosmetics;
22
C&S Paper Co., Ltd. Semi-annual Report 2023
wholesale of cosmetics; sales of personal hygiene products; sales of knitwear; manufacture
of maternal and infant products; sales of maternal and infant products; sales of daily
necessities; sales of daily chemical products; sales of disinfectants (excluding hazardous
chemicals); sales of Class I medical devices; sales of Class II medical devices; export of
goods; export of technologies; Internet sales (excluding the sales of commodities requiring a
permit); information technology consulting services (The company may carry out business
operations independently according to the law based on the business license, except for items
that must be licensed according to the law.) Licensed items: production of cosmetics;
production of sanitary products and disposable medical supplies(for items that must be
approved in accordance with the law, companies may carry out business operations upon
approval by relevant departments, and the specific business items are subject to the approval
document or the permit issued by competent department).( The above business activities do
not involve prohibited items in the Negative list of foreign investment in China)
Acquisition and disposal of subsidiaries during the reporting period
□ Applicable √ Not applicable
Description of main holding and joint-stock companies
None
23
C&S Paper Co., Ltd. Semi-annual Report 2023
IX. Structured Entities Controlled by the Company
□ Applicable √ Not applicable
X. Risks Faced by the Company and Countermeasures
1. Risk of great fluctuations in pulp prices
Pulp is an international bulk raw material and its price is obviously affected by the world economic cycle. The pulp
price has surged in 2022 under the impact of major international events such as the conflict between Russia and
Ukraine, the European energy crisis, and volatile geopolitical relations. Pulp is the primary raw material of the
Company’s production, accounting for 40%-60% of the total production costs. Therefore, substantial fluctuations
in pulp prices pose a risk to the Company.
The Company is equipped with a professional procurement team which, on the premise of ensuring normal
production inventory, adjusts the purchase rhythm by professionally evaluating the future trend of pump boards and
coordinating the market conditions of international pulp prices. The Company has cemented long-term supply
contracts with pulp suppliers that have large production scale, abundant forest resources and advanced production
technologies to ensure stable raw material procurement. It has established a global procurement network with
purchases in Europe, North America, South America, etc.
2. Risk of exchange rate fluctuation
The import of machinery equipment and pulp and the export of products to overseas market of the Company are
mainly settled in USD, HKD, and EUR. Since exchange rates fluctuate under the impact of the international
economic situation, the Company faces exchange rate risks.
The Company pays close attention to changes in the foreign exchange market on a daily basis and hedges against
exchange losses brought by RMB depreciation or two-way fluctuations by adjusting the structure of foreign
currency assets and liabilities and reducing overall foreign currency liabilities. In addition, the Company started to
adopt the spot selling rate accounting for foreign currency transactions since 2015 in accordance with its actual
needs and in compliance with foreign exchange requirements. In this way, the Company may choose to buy foreign
currency and pay for the goods at a rate favorable to the Company at an appropriate time. Furthermore, the Company
hedges against and avoids exchange rate risks via centralized management of foreign exchange funds, purchase
payment hedging, etc. based on changes in the foreign exchange market and actual development of the Company.
With regard to exchange rate risk exposure, the Company also uses hedging and other financial tools to conduct
reasonable risk management.
3. Risk of regional market competition
24
C&S Paper Co., Ltd. Semi-annual Report 2023
Household paper is a vast market in China in terms of both geography and market space. Given the low unit value,
transportation expenses taking up a large part of the sales price, and limitations of the transportation radius, the main
competition in the household paper industry lies in regional markets. High-end, mid-end, and low-end products
compete in regional markets, with the influence of spending power and consumption habit. Judging from the
development trend of the industry, mid- and high-end household paper of national brands has more competitive
edge. However, at present, some regional brands have an advantage in some regional markets. Compared with
overseas counterparts, China’s household paper industry requires continued integration. The Company embraces
production bases and a sales network across the country and offers mid- and high-end products under national brands.
Nevertheless, it is inescapable from the risk of regional market competition.
After years of development, the Company has become one of the leading companies in the domestic household
paper industry. It has built a marketing network covering most prefecture (county) level cities and a production base
with national presence. As a result, transportation costs can be effectively reduced and transportation efficiency
effectively improved by shorting the distance with consumers. As the Company continues to deepen and expand
sales channels, it will gradually cover untapped outlets. In the future, in response to market competition, the
Company will strengthen channel sinking, increase market penetration, further expand its scale, and further improve
its overall market competitiveness and shares.
4. Risk of industrial policies
Stricter requirements have been raised for the papermaking industry in the aspects of scale, technology, equipment,
and environmental protection, as multiple industry plans and supporting policies have been successively issued by
relevant departments, including the Papermaking Industry Development Policy, the Notice on the Management of
Elevated Source Pollution Discharge Permits in Thermal Power and Papermaking Industries and Pilot Cities of
Beijing-Tianjin-Hebei Region, and the Opinions of China Paper Association on Fourteenth Five-year Plan for the
Papermaking Industry. Particularly, a number of measures have been introduced through environmental protection
policies to drive the all-round, coordinated, and sustainable development of the household paper industry, including
1) optimizing the industrial distribution to reasonably allocate resources and promoting clean production to preserve
the ecological environment; 2) pushing energy conservation and emission reduction to shut down outdated
production facilities, and adjusting product structure and improving product quality; 3) developing resource-saving
models to advocate green consumption; and 4) optimizing enterprise structure and driving M&A and restructuring.
These policies are designated to strengthen household paper industry concentration, close backward production
facilities, and optimize resource allocation. The Company, as an enterprise in the first echelon of the domestic
household paper industry, is underpinned by national policies related to the sustainable development of the
household paper industry. Precisely because of this, industrial policy adjustment, if any, will impact the production
and operations of the Company to some extent.
25
C&S Paper Co., Ltd. Semi-annual Report 2023
In the face of increasing stringent environmental protection policies, as a responsible domestic enterprise in the
household paper industry, the Company and its subsidiaries strictly abide by environmental protection laws and
regulations of the state and local governments. Production bases are equipped with state-of-the-art papermaking
equipment, processing equipment and environmental protection treatment equipment and facilities, and adopt
advanced environmental protection technologies. With continuous capital and technological inputs and
improvement in pollution control of the production process, the Company strives to reduce environmental pollution
and ensure green production. The Company will continue to optimize production efficiency in response to
requirements of national industrial policies.
5. Risk of safe production
Most of the materials involved in the household paper industry are flammable, including the main raw material of
pulp, the main packing materials of plastic-film packing bags and cartons, the semi-finished product of body paper,
and finished products. Due to the characteristics of low unit value and large market consumption, household paper
manufacturers have to keep a mass of pulp, packing materials, and semi-finished and finished products from the
entry of raw materials into the plant to the delivery of products to the market. Thus, fire can cause enormous losses
to such manufacturers. In addition, a large number of production lines have been put into use, which may pose
certain occupational health hazard and cause harm to the occupational health of employees.
In view of this, the Company has formulated strict fire management regulations, established a full-time safety
management department, equipped delicated safety management personnel, equipped adequate safety protection
and fire protection equipment in production areas, and bought full insurance for risky properties. As such, the
Company’s fire safety risk is low. The Company has always adhered to the concept of intrinsic safety, continuously
improved mechanical safety protection, improved equipment safety, and reduced safety risks during the operation
process. In response to possible occupational health hazards, the Company, at the equipment design and procurement
stages, requires suppliers to carry out intrinsic safety design and fulfill the protection measures during the
installation process. At the same time, the Company has passed the ISO45001 occupational health and safety (OHS)
management system and continues to maintain its effective operations to reduce the occupational health and safety
risks of employees.
26
C&S Paper Co., Ltd. Semi-annual Report 2023
Section IV Corporate Governance
I. Annual General Meeting and Extraordinary General Meetings Held during the Reporting
Period
1. Shareholder meetings during the reporting period
Ratio of
Session of Date of Date of
Type investor Resolutions of the meeting
meeting convening disclosure
participation
2023 First Extraordinary Details can be found in the Announcement on the
Extraordinary general January January Resolution of the 2023 First Extraordinary General
53.69%
General meeting of 10,2023 11,2023 Meeting of Shareholders (Announcement No.:
Meeting shareholders 2023-02) on CNINFO (http://www.cninfo.com.cn) .
Details can be found in the Announcement on the
2023 Second Extraordinary
Resolution of the 2023 Second Extraordinary
Extraordinary general April April
52.97% General Meeting of Shareholders (Announcement
General meeting of 3,2023 4,2023
No.: 2023-18) on CNINFO
Meeting shareholders
(http://www.cninfo.com.cn) .
Details can be found in the Announcement on the
2022 Annual
Annual Resolution of the 2022 Annual General Meeting of
General May May
general 52.89% Shareholders (Announcement No.: 2023-31) on
Meeting of 11,2023 12,2023
meeting CNINFO (http://www.cninfo.com.cn) .
Shareholders
2. Extraordinary general meetings of shareholders proposed to be convened by preferred shareholders whose
voting rights were resumed
□ Applicable √ Not applicable
II. Changes in Directors, Supervisors and Senior Management of the Company
√ Applicable □ Not applicable
Name Position Type Date Reason
Served as an independent director of the
He Haidi Independent Director Resigned April 3, 2023
Company for six consecutive years
Elected by the general meeting of
Ge Guangrui Independent Director Elected April 3, 2023
shareholders
III. Profit Distribution and Conversion of Capital Reserve to Share Capital during the
Reporting Period
□ Applicable √ Not applicable
The Company plans not to distribute cash dividend, issue bonus share, or transfer capital reserve into share capital
for the half year.
27
C&S Paper Co., Ltd. Semi-annual Report 2023
IV. Implementation of the Stock Incentive Plan, Employee Stock Ownership Plan, and Other
Employee Incentives of the Company
√ Applicable □ Not applicable
1. Equity incentive
Implementation of the 2018 Stock Option and Restricted Stock Incentive Plan during the reporting period:
(1) During the third unlock period for the reserved restricted shares, a total of 178,536 restricted shares needed to
be repurchased and canceled. The repurchase and cancellation procedures for the above granted but not unlocked
restricted shares were completed at the Shenzhen Branch of China Securities Depository and Clearing Corporation
Limited on February 9, 2023.
(2) On March 15, 2023, the Company convened the 20th meeting of the Fifth Board of Directors and the 15th
meeting of the Fifth Board of Supervisors, which reviewed and approved the Proposal on the Deregistration of
Stock Options Awarded in the First Grant under the Company’s 2018 Stock Option and Restricted Stock Incentive
Plan That Have Not Been Exercised in the Third Exercise Period. During the third exercise period of the first-
granted stock options (i.e. June 29, 2022 to March 03, 2023), nine recipients did not exercise the stock options
within the period, so 6,082 shares needed to be canceled. The cancellation procedures for the aforementioned 6,082
shares were completed on April 6, 2023 under the review and confirmation of the Shenzhen Branch of China
Securities Depository and Clearing Corporation Limited.
Implementation of the 2022 Stock Option and Restricted Stock Incentive Plan during the reporting period:
(1) On December 20, 2022, the Company convened the 18th meeting of the Fifth Board of Directors, the 13th
meeting of the Fifth Board of Supervisors, and the 2023 First Extraordinary General Meeting of Shareholders, which
deliberated and approved the Proposal on the 2022 Stock Option and Restricted Stock Incentive Plan (Draft) and
Its Summary. For details, please refer to the Company's relevant announcements on CNINFO.
(2) On January 4, 2023, the Company's Board of Supervisors issued an explanation and the audit opinions on the
list of incentive recipients under the 2022 Stock Option and Restricted Stock Incentive Plan. At the same time, the
Company issued a self-inspection report on the buying and selling of corporate shares by insiders and incentive
recipients of the 2022 Stock Option and Restricted Stock Incentive Plan.
(3) On January 31, 2023, the Company held the 19th meeting of the Fifth Board of Directors and the 14th meeting
of the Fifth Board of Supervisors, which reviewed and approved the Proposal on Granting Stock Options and
Restricted Shares to Incentive Recipients for the First Time. The Board believed that the granting conditions
stipulated in the incentive plan were fulfilled and thereby agreed to, with January 31, 2023 as the first-grant date,
grant a total of 15.665 million stock options to 686 incentive recipients who met the granting conditions with an
exercise price of RMB9.48/share, and a total of 21.765 million restricted shares to 694 incentive recipients who met
the granting conditions with a grant price of RMB6.32/share.
(4) The registration procedures for the first-granted stock options under the 2022 Stock Option and Restricted Stock
Incentive Plan were completed on February 24, 2023, with a quantity of 15.48 million, number of recipients 654,
28
C&S Paper Co., Ltd. Semi-annual Report 2023
stock option abbreviation C&S JLC3, and stock option code 037336. In addition, the registration procedures for the
first-granted restricted shares under the 2022 Stock Option and Restricted Stock Incentive Plan were completed on
March 6, 2023, with a quantity of 20.9615 million, number of recipients 617, and stock listing date March 7, 2023.
2. Implementation of the employee stock ownership plan
□ Applicable √ Not applicable
3. Other employee incentives
□ Applicable √ Not applicable
29
C&S Paper Co., Ltd. Semi-annual Report 2023
Section V Environmental and Social Responsibilities
I. Main Environmental Protection Issues
Whether the listed company and its subsidiaries are the key pollution discharge units published by the
environmental protection department
√ Yes □ No
The Company and its subsidiaries and branches strictly complied with national and local environmental laws and
regulations, including the Environmental Protection Law of the People's Republic of China, the Environmental
Impact Assessment Law of the People's Republic of China, the Law of the People's Republic of China on the
Prevention and Control of Water Pollution, the Law of the People's Republic of China on the Prevention and Control
of Atmospheric Pollution, the Law of the People's Republic of China on the Prevention and Control of
Environmental Pollution by Solid Waste, the Regulation on the Safety Management of Hazardous Chemicals, and
the Interim Provisions on the Supervision and Management of Major Hazard Sources of Dangerous Chemicals, as
well as national and industry standards on environmental protection including the Wastewater quality standards for
discharge to municipal sewers (GB/T31962-2015), the Discharge standard of water pollutants for pulp and paper
industry (GB3544-2008), the Emission standard of air pollutants for boiler (GB13271-2014), and the Discharge
standard of pollutants for municipal wastewater treatment plant (GB18918-2002).
Environmental protection administrative permits
1. Jiangmen C&S obtained the Pollutant Discharge Permit (No. 91440700758324965B001P) on July 9, 2020, with
a valid period from June 15, 2020 to June 14, 2025.
2. Sichuan C&S obtained the Pollutant Discharge Permit (No. 9151018270925944X0001P) on June 26, 2020, with
a valid period from June 27, 2020 to June 26, 2025.
3. Zhejiang C&S obtained the Pollutant Discharge Permit (No. 91330400793360582E001P) on December 6, 2022,
with a valid period from December 6, 2022 to December 5, 2027.
4. Tangshan C&S obtained the Pollutant Discharge Permit (No. 91130200689262827L001P) on August 7, 2022,
with a valid period from June 23, 2020 to June 22, 2025.
5. Yunfu C&S obtained the Pollutant Discharge Permit (No. 91445381053735377Y001P) on June 22, 2020, with a
valid period from June 2, 2019 to June 1, 2024.
6. Hubei C&S obtained the Pollutant Discharge Permit (No. 91420900764132820H002P) on April 10, 2023, with
a valid period from May 21, 2023 to May 20, 2025.
Construction projects: The Company has always been strictly in accordance with environmental laws and
regulations to implement the control of construction projects. Environmental impact assessment was carried out for
all construction projects and environmental protection project construction was arranged according to construction
plan, to ensure that the environmental protection facilities and the main project are designed, constructed and put
into use at the same time. At present, all construction projects put into production have completed environmental
impact assessment and acceptance and approval.
30
C&S Paper Co., Ltd. Semi-annual Report 2023
Industry discharge standards and specifics of pollutant discharge in production and operation activities:
Category of Implemente
Name of Main pollutants Number of Total
main pollutants Concentration of d pollutant Total Excessive
company or and particular Ways of discharge discharge Distribution of discharge outlets approved
and particular discharge discharge discharge discharge
subsidiary pollutants outlets discharge
pollutants standards
Discharge directly to the
Centralized processing facilities in
COD centralized sewage treatment 1 102mg/L 200mg/L 31.62t 335.600 t/a None
the factory
plant
Jiangmen C&S Waste water
Discharge directly to the
Ammonium Centralized processing facilities in
centralized sewage treatment 1 3.71mg/L 8mg/L 1.33t 13.4 t/a None
nitrate the factory
plant
Production waste water discharge
Discharge to the water
(DW001) flows through the
purification station through
COD 1 channel into the main outlet 50.3 mg/L 80mg/L 24.87t 96 t/a None
urban sewage pipeline after
DW002 (confluent with domestic
treatment
waste water)
Waste water
Production waste water discharge
Discharge to the water
(DW001) flows through the
Ammonium purification station through
1 channel into the main outlet 0.51 mg/L 8mg/L 0.27t 9.6 t/a None
nitrate urban sewage pipeline after
DW002 (confluent with domestic
treatment
waste water)
Sichuan C&S
Three chimneys (2# boiler is the 1# boiler 2mg/m
PM (particulate Discharge directly through the
3 standby boiler, monitoring when 2# boiler 0 mg/m 10mg/m 0.17t / None
matter) flue
being used) 3# boiler 2.3 mg/m
Three chimneys (2# boiler is the 1# boiler 24 mg/m
Waste gas Discharge directly through the
Nitrogen oxide 3 standby boiler, monitoring when 2# boiler 0 mg/m 30mg/m 2.04t 10.454t/a None
flue
being used) 3# boiler 28 mg/m
Three chimneys (2# boiler is the
Discharge directly through the
Sulfur dioxide 3 standby boiler, monitoring when 0 10mg/m 0 / None
flue
being used)
Discharge to Jiaxing Industrial
Centralized processing facilities in
COD Sewage Treatment Plant through 1 76.74mg/L 500mg/L 7.12t 13.97t/a None
the factory
municipal pipe after treatment
Zhejiang C&S Waste water
Discharge to Jiaxing Industrial
Ammonium Centralized processing facilities in
Sewage Treatment Plant through 1 3.91mg/L 35mg/L 0.37t 9.78t/a None
nitrate the factory
municipal pipe after treatment
Discharge to the Lvyuan Sewage
Treatment Plant in the zone after Main outlet of the zone (Lvyuan
Tangshan C&S Waste water COD 1 22.72mg/L ≤50mg/L 3.76t 26.068 t/a None
being treated by the plant Sewage Treatment Plant)
sewage treatment station
31
C&S Paper Co., Ltd. Semi-annual Report 2023
Discharge to the Lvyuan Sewage
Ammonium Treatment Plant in the zone after Main outlet of the zone (Lvyuan
1 2.98mg/L ≤5mg/L 0.58t 2.55t/a None
nitrate being treated by the plant Sewage Treatment Plant)
sewage treatment station
Discharge directly through the
Waste gas Nitrogen oxide 1 One chimney 21.68mg/m ≤30mg/m 1.3t 6.97t/a None
flue
Sewage treatment station in the
COD Discharge directly 1 30.64mg/L 80mg/L 30.58t 197.71t/a None
factory
Yunfu C&S Waste water
Ammonium Sewage treatment station in the
Discharge directly 1 0.72mg/L 8mg/L 0.72t 19.76t/a None
nitrate factory
Discharge indirectly (discharge Discharge to Biquan Sewage
to Biquan Sewage Treatment Treatment Plant after pre-
COD 1 126.33mg/L ≤400mg/L 18.09t 152.25t/a None
Plant through municipal pipe processing with centralized
after treatment) processing facilities in the factory,
Waste water
Discharge indirectly (discharge Discharge to Biquan Sewage
Ammonium to Biquan Sewage Treatment Treatment Plant after pre-
1 3.07mg/L ≤30 mg/L 0.23t 15.25t/a None
nitrate Plant through municipal pipe processing with centralized
after treatment) processing facilities in the factory,
Hubei C&S Organized discharge (dedusting
PM (particulate by bag filter, desulfurization by
1 One chimney 3.82mg/m ≤30mg/m 2.71 t 28.63t/a None
matter) limestone-gypsum and
denitration by SNCR)
Organized discharge (dedusting
by bag filter, desulfurization by
Waste gas Sulfur dioxide 1 One chimney 56mg/m ≤200mg/m 46.27 t 203.87t/a None
limestone-gypsum and
denitration by SNCR)
Organized discharge (dedusting
by bag filter, desulfurization by
Nitrogen oxide 1 One chimney 74.83mg/m ≤200mg/m 58.14t 239.85t/a None
limestone-gypsum and
denitration by SNCR)
32
C&S Paper Co., Ltd. Semi-annual Report 2023
Treatment of pollution
(1) Duty toward compliance: The Company and its subsidiaries and branches strictly abide by national and local
environmental laws and regulations. All new projects strictly implement the environmental impact assessment
system and "three simultaneous" system. All production activities strictly comply with the Environmental Protection
Law of the People’s Republic of China, the Law of the People’s Republic of China on the Prevention and Control
of Water Pollution, the Law of the People’s Republic of China on the Prevention and Control of Atmospheric
Pollution, the Law of the People’s Republic of China on the Prevention and Control of Environmental Pollution by
Solid Waste and the Action Plan for Prevention and Control of Water Pollution, and ensure that all pollutant
treatment and discharge are in line with the requirements of laws and regulations.
(2) Configuration and operation of water treatment equipment and facilities: Each subsidiary or branch has a
complete array of environmental protection treatment equipment and facilities. The main sewage treatment
processes are anaerobic, aerobic and subsequent deep treatment processes, which can achieve the discharge
standards of various sewage indicators. In addition, each subsidiary or branch is equipped with a recycling water
system in which the reclaimed water that meets the usage standard is used for re-production to reduce the discharge
of sewage as far as possible. The sewage of Jiangmen C&S, Sichuan C&S, Zhejiang C&S, Hubei C&S and Tangshan
C&S is discharged after centralized treatment in the company and treated by the local sewage treatment plants. After
centralized treatment in the company, the sewage of Sichuan C&S enters water purification station through urban
sewage pipeline. The sewage of Yunfu C&S, after treated by the company’s sewage treatment station and reaching
the standard, is discharged in an organized manner.
(3) Online monitoring and operation of water treatment facilities: Six subsidiaries or branches in Jiangmen, Sichuan,
Zhejiang, Tangshan, Yunfu and Hubei have all installed on-line sewage monitoring facilities, which are directly
supervised by local environmental protection bureau. The sewage of Tangshan C&S, after centralized treatment in
the subsidiary, is discharged to the sewage plant of the local paper industry base without any other sewage outlet.
The company has its own monitoring facilities for internal control reference. After the centralized treatment within
the company, the sewage of Jiangmen C&S is discharged to the sewage plant of the local paper industry base; there
is no other sewage outlet and no online monitoring facilities. The environmental protection bureau goes to the
company regularly every quarter to compare the on-line monitoring data, which all meet the requirements.
(4) Boiler waste gas emission: Sichuan C&S and Tangshan C&S are equipped with natural gas boilers. Hubei C&S
is equipped with a coal-fired boiler, and waste gas is emitted uniformly after desulfurization and denitrification.
Boiler waste gas emission conforms to GB13271-2014 Emission Standard of Air Pollutants for Boiler.
Emergency plan for sudden environmental events
(1) Preparation and reporting of emergency plan for sudden environmental events: The Company strictly
implements emergency response rules for sudden environmental events, and, in accordance with the technical
requirements in the Technical Guidelines for Preparation of Emergency Plans for Environmental Pollution
Accidents, employs a professional advisory and guidance organization to formulate the Emergency Plan for Sudden
Environmental Events, which has been reviewed by and filed with the Environmental Protection Bureau.
(2) Emergency response supplies, training and drill: The Company has matched the corresponding emergency
response supplies according to the requirements of the Emergency Plan for Sudden Environmental Events.
33
C&S Paper Co., Ltd. Semi-annual Report 2023
Emergency response measures for hazardous chemicals have been prepared according to environmental protection
requirements, and necessary labor protection supplies and emergency response supplies have been provided in
accordance with safety technical instructions, and checked and updated regularly. The Company regularly carries
out emergency training and drill and suitability assessment of the emergency plan to ensure the effectiveness and
enforceability of the emergency plan.
Investment in environmental governance and protection and payment of environmental protection taxes
During the reporting period, the Company and its subsidiaries and branches invested a total of RMB3.8952 million
in environmental governance and protection, including testing costs, sludge disposal costs, hazardous waste disposal
costs and online operation and maintenance costs, and paid a total of RMB422,300 in environmental protection
taxes.
Environmental self-monitoring program
(1) Self-monitoring ledger: The Company strictly abides by laws and regulations, carries out self-monitoring work
in accordance with environmental protection requirements, establishes environmental management ledger and data,
and constantly improves it.
(2) Waste water monitoring: At present, self-monitoring is a combination of manual monitoring and automatic
monitoring, and qualified units are entrusted to carry out monitoring regularly. Automatic monitoring items: main
discharge outlet of waste water (COD, ammonium nitrate, flow rate, PH, total nitrogen); Manual monitoring items:
BOD, SS and chroma indicators are monitored daily or weekly; for other sewage monitoring items, uncontrolled
emissions, solid waste and factory boundary noise, each subsidiary entrusts qualified units to carry out monitoring
work monthly or quarterly according to the local environmental protection requirements.
(3) Waste gas monitoring: The main testing items are nitrogen oxide, ringelman emittance, sulfur dioxide, soot,
mercury and their compounds. The testing frequency is in compliance with the requirements of regulations.
(4) The self-monitoring data of pollutant discharge and environmental monitoring plans are disclosed on provincial
disclosure websites for key pollution source information while paper reports are submitted to the Environmental
Protection Bureau for archival.
Administrative penalties due to environmental issues during the reporting period
Impact on production and Rectification
Name of company or Reason of
Violation Penalty result operation of the listed measures of the
subsidiary penalty
company Company
Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable
Other environmental information that should be disclosed
(1) Emission permit information and environmental protection information related to emission permit requirements
are available on national emission permit management information platform; in the event that competent
government departments in the localities of the subsidiaries and branches have additional requirements, such
information is published on the platform for environmental information reporting prescribed by the local
government authority.
(2) Other environmental protection-related information is available in the "News" section of the Company’s website.
Measures taken to reduce carbon emissions during the reporting period and their effects
√ Applicable □ Not applicable
1. Sichuan C&S renovated the gas hood, which reduced the natural gas consumption per ton of paper.
34
C&S Paper Co., Ltd. Semi-annual Report 2023
2. In order to further reduce pollution, improve resource utilization efficiency and decrease production costs as well
as heat consumption and emission, Zhejiang C&S, under the advocacy of competent local government departments,
implemented several cleaner production programs, which achieved tangible results and attained the expected goals
for cleaner production and carbon reduction.
3. Tangshan C&S performed the energy-saving upgrade for TT dryer cylinders, to ensure product quality, reduce
production costs, and decrease the natural gas consumption per ton of paper.
4. The Group changed to use magnetic levitation vacuum pumps in all production areas to reduce the power
consumption of papermaking.
Other relevant information on environmental protection: None
II. Social Responsibilities
During the reporting period, the Company actively fulfills corporate social responsibilities (CSR). Abiding by the
principle of integrity and its commitments, it strives to safeguard the legitimate rights and interests of all
stakeholders including shareholders, employees, consumers, partners and the society at large and thereby makes
due contribution to sustainable development of the society and the environment. Meanwhile, as a national enterprise
with important social influence and a leading enterprise in the household paper industry, the Company has actively
carried out poverty alleviation and rural revitalization work. Specifics are as follows:
1. The Company has donated medical surgical masks, children's masks, sanitary wipes, sanitary pads, paper tissues
and other materials to a number of regions, with a total market value of about RMB1.6 million.
2. The Company donated RMB80,000 to poverty-stricken areas to support for education, the elderly, those in
poverty, medical, families of the military, sports, culture and other causes.
3. Jiangmen C&S paid regular visits to veteran party members and local households in need in Shuangshui Town,
donating funds and paper tissues to them; it also signed an employment cooperation agreement with the local
Veterans Affairs Bureau and was awarded the honorary title of “Enterprise of Army Supporting and Caring”.
4. Hubei C&S organized activities to help needy families, and held the “Xiaogan Carving and Paper-cutting”
activity to carry forward the intangible cultural heritage, thereby promoting excellent traditional Chinese culture.
35
C&S Paper Co., Ltd. Semi-annual Report 2023
Section VI Significant Events
I. Commitments Completed by Actual Controllers, Shareholders, Related parties, Purchasers
within the Reporting Period, or Commitments Not Fulfilled by the End of the Reporting Period
□ Applicable√ Not applicable
During the reporting periods, the Company did not have commitments completed by actual controllers,
shareholders, related parties, purchasers during the reporting period, or commitments not fulfilled by the end of
the reporting period.
II. Appropriation of Funds for Non-Operating Purposes by Controlling Shareholder and Its
Related Parties
□ Applicable √ Not applicable
During the reporting period, the Company did not have any funds appropriated for non-operating purposes by the
controlling shareholder and its related parties.
III. External Guarantee in Violation of Prescribed Procedures
□ Applicable √ Not applicable
During the reporting period, there was no external guarantee in violation of prescribed procedures.
IV. Engagement and Dismissal of Accounting Firm
Whether the Semi-annual Report has been audited
□ Yes √ No
The Semi-annual Report of the Company has not been audited.
V. Explanation by the Board of Directors of the “Non-standard Audit Report” for the
Reporting Period Issued by the Accounting Firm
□ Applicable √ Not applicable
VI. Explanation by the Board of Directors of the “Non-standard Audit Report” of the Previous
Year
□ Applicable √ Not applicable
VII. Matters relating to Bankruptcy and Restructuring
□ Applicable √ Not applicable
36
C&S Paper Co., Ltd. Semi-annual Report 2023
No bankruptcy and restructuring-related matters of the Company happened during the reporting period.
VIII. Litigations
Material litigations and arbitrations
□ Applicable √ Not applicable
There were no material litigations or arbitrations during the reporting period.
Other litigations
√ Applicable □ Not applicable
Amount Hearing results Execution of Date Index
Basic information of Whether projected Litigation
involved and influences judgment of of of
the litigation liabilities were (arbitration)
(RMB of the litigation the litigation disclo disclo
(arbitration) incurred progress
10,000) (arbitration) (arbitration) sure sure
Summary of closed Projected
litigation and 4,311.03 liabilities of Case closed Case closed Case closed / /
arbitration RMB30,300
Summary of unclosed
litigation and 6,265.34 No In execution In execution In execution / /
arbitration
IX. Penalty and Rectification
□ Applicable √ Not applicable
X. Integrity Records of the Company and its Controlling Shareholder and Actual Controller
□ Applicable √ Not applicable
XI. Material Related Party Transaction
1. Related party transactions relating to daily operations
√ Applicable □ Not applicable
Pric Amou Propor
Pricin e of nt of tion in Wheth
Type Conte Approve Settleme Available
Party of g rules relat related the er to
Relate of nt of d nt of market Date Index
related of ed party amoun outstri
d related related transacti related prices for of of
party related part transa t of p the
relatio party party on limit party similar disclo disclo
transacti party y ction simila appro
nship transa transa (RMB1 transacti transactio sure sure
on transa trans (RMB r ved
ction ction 0,000) on ns
ction actio 10,000 transa limit
ns ) ctions
Deng
Actual
Yingzho Mar Dece
control
ng, Marke ket Transfer
ler of 175． 14.84 Market mber 2021-
Deng Lease Rental t fair fair 175.79 No settleme
the 79 % fair price 1,202 145
Guanbia price pric nt
Comp 1
o, Deng e
any
Guanjie
Deng Actual Marke Mar Transfer
Market
Yingzho control Lease Rental t fair ket 0.65 0.05% Yes settleme
fair price
ng, ler of price fair nt
37
C&S Paper Co., Ltd. Semi-annual Report 2023
Deng the pric
Guanbia Comp e
o, Deng any
Guanjie
Total -- -- 176.44 -- 175.79 -- -- -- -- --
Details of returns of large sales Not applicable
Where the total amount of daily
related-party transactions occurred in Among the excessive amounts of related party transactions in the reporting period, RMB 6,500 is
the current period is estimated by for renting properties from the related party. They fall within the authority of the Chairman of the
category, actual performance during Company and can be implemented without the approval of the Board of Directors.
the reporting period (if any)
Reason(s) for a large difference
between the transaction price and the Exercise at fair price
market reference price (if applicable)
2. Related party transactions relating to acquisition and sale of assets or equity
□ Applicable √ Not applicable
During the reporting period, there was no related party transaction relating to acquisition and sale of assets or equity.
3. Related party transactions relating to joint outbound investment
□ Applicable √ Not applicable
During the reporting period, there was no related party transaction relating to joint outbound investment.
4. Related party transactions relating to creditor’s rights and debts
□ Applicable √ Not applicable
During the reporting period, there was no related party transactions relating to creditor’s rights and debts.
5. Transactions with related party financial companies
□ Applicable √ Not applicable
The Company did not have deposit, loan, credit or other financial business transactions with financial companies
that have related relationship and the associated related parties.
6. Transactions between financial companies controlled by the Company and related parties
□ Applicable √ Not applicable
Financial companies controlled by the Company did not have deposit, loan, credit or other financial business
transactions with related parties.
7. Other significant related party transactions
□ Applicable √ Not applicable
During the reporting period, there were no other significant related party transactions.
38
C&S Paper Co., Ltd. Semi-annual Report 2023
XII. Significant Contracts and Their Performance
1. Custody, contracting and leasing matters
(1) Custody
□ Applicable √ Not applicable
During the reporting period, there was no custody.
(2) Contracting
□ Applicable √ Not applicable
During the reporting period, there was no contracting.
(3) Leasing
√ Applicable □ Not applicable
Description of leasing matters
On November 30, 2021, the Company convened the 12th meeting of the fifth session of the Board of Directors and
the 7th meeting of the fifth session of the Board of Supervisors, on which the Proposal on Daily Related Party
Transactions was reviewed and approved. The Board of Directors of the Company agreed that the Company and its
wholly-owned subsidiary, Zhongshan Zhongshun Trading Co., Ltd., leased the real estate jointly owned by Mr.
Deng Yingzhong, Mr. Deng Guanbiao and Mr. Deng Guanjie, the actual controllers of the Company. The lease term
is from January 1, 2022 to December 31, 2023, and the total rent involved is RMB 7,031,600. During the deliberation
of this proposal, the Company’s three related directors, Mr. Deng Yingzhong, Mr. Deng Guanbiao and Mr. Deng
Guanjie, withdrew from voting, while the remaining six attending directors unanimously approved this related party
transaction. The three independent directors of the Company respectively issued Prior Approval Opinions and
Opinions of Independent Directors on the proposal, agreeing to submit the proposal to the Board of Directors for
deliberation and agreeing to the related party transaction.
Projects whose profits or losses brought to the Company reached more than 10% of the total profits of the Company
during the reporting period
□ Applicable √ Not applicable
During the reporting period, there were no leasing projects whose profits or losses brought to the Company reached
more than 10% of the total profits of the Company during the reporting period.
2. Material guarantee
√ Applicable □ Not applicable
39
C&S Paper Co., Ltd. Semi-annual Report 2023
Unit: RMB10,000
External guarantee of the Company and subsidiaries (excluding guarantee for subsidiaries)
Whe
Whe ther
Disclosure
ther it is
date of Actual
Actual it relat
Name of relevant guaran Collat Counter
Guarantee date of Guarant Guarantee has ed
guarantee announce tee eral (if guarantee
limit occurrenc ee type period been part
object ment on amoun any) (if any)
e com y
guarantee t
plete guar
limit
d ante
e
Joint
Wuhan Jie and Joint and
Rou E- November September several several 2022.9.26-
15,000 8,860 None No No
commerce 30,2021 26,2022 liability liability 2023.11.3
Co., Ltd. guarante guarantee
e
Joint
Shanghai and Joint and
Junmeng E- November September several several 2022.9.27-
23,500 9,000 None No No
commerce 30,2021 27,2022 liability liability 2023.11.4
Co., Ltd. guarante guarantee
e
Total actual
amount of
Total approved amount of
external guarantee
external guarantee during 0 17,860
during the
the reporting period (A1)
reporting period
(A2)
Total actual
Total approved amount of
guarantee balance
external guarantee at the
38,500 at the end of the 17,860
end of the reporting
reporting period
period (A3)
(A4)
Guarantee of the Company for subsidiaries
Whe
Whe ther
Disclosure
ther it is
date of Actual
Actual it relat
Name of relevant guaran Collat Counter
Guarantee date of Guarant Guarantee has ed
guarantee announce tee eral (if guarantee
limit occurrenc ee type period been part
object ment on amoun any) (if any)
e com y
guarantee t
plete guar
limit
d ante
e
Joint
and
Zhongshan November November 4,984. several 2022.11.23-
15,000 None None No No
Trading 30, 2021 23, 2022 15 liability 2026.11.9
guarante
e
Joint
Zhongshan November Janurary 17,15 and 2023.1.30-
20,000 None None No No
Trading 23, 2022 30, 2023 9.41 several 2029.1.29
liability
40
C&S Paper Co., Ltd. Semi-annual Report 2023
guarante
e
Joint
and
Zhongshan November June 14, several 2023.6.14-
20,000 0 None None No No
Trading 23, 2022 2023 liability 2027.4.19
guarante
e
Joint
and
Zhongshan November May 25, several 2023.5.25-
10,000 0 None None No No
Trading 23, 2022 2023 liability 2027.4.18
guarante
e
Joint
and
Zhongshan November April 26, several 2023.4.26-
50,000 6,000 None None No No
Trading 23, 2022 2023 liability 2028.12.31
guarante
e
Joint
and
Zhongshan November April 27, several 2023.4.27-
5,000 5,000 None None No No
Trading 23, 2022 2023 liability 2027.4.27
guarante
e
Joint
and
Zhongshan November December 13,00 several 2022.12.8-
30,000 None None No No
Trading 30, 2021 8, 2022 0 liability 2025.12.31
guarante
e
Joint
and
Zhongshan November December 8,472. several 2022.12.23-
15,000 None None No No
Trading 30, 2021 23, 2022 38 liability 2026.9.22
guarante
e
Joint
and
Zhongshan November May 17, 20,00 several 2022.5.17-
20,000 None None No No
Trading 30, 2021 2022 0 liability 2030.2.27
guarante
e
Joint
and
Zhongshan November August several 2022.8.18-
20,000 1,000 None None No No
Trading 30, 2021 18, 2022 liability 2030.12.31
guarante
e
Joint
and
Jiangmen November November 11,770 several 2022.11.23-
12,000 None None No No
C&S 30, 2021 23, 2022 .75 liability 2026.11.7
guarante
e
Jiangmen November 15,000 January 3,339. Joint None None 2023.1.17- No No
41
C&S Paper Co., Ltd. Semi-annual Report 2023
C&S 23, 2022 17, 2023 59 and 2026.11.29
several
liability
guarante
e
Joint
and
Jiangmen November June 14, several 2023.6.14-
15,000 0 None None No No
C&S 23, 2022 2023 liability 2027.4.19
guarante
e
Joint
and
Jiangmen November May 25, 2,376. several 2023.5.25-
10,000 None None No No
C&S 23, 2022 2023 87 liability 2027.4.18
guarante
e
Joint
and
Jiangmen December December several 2020.12.23-
5,000 0 None None No No
C&S 5, 2019 23, 2020 liability 2025.12.23
guarante
e
Joint
and
December April 14, several 2020.4.14-
Yunfu C&S 8,000 0 None None No No
05, 2019 2020 liability 2028.4.14
guarante
e
Joint
and
November June 15, several 2023.6.15-
Yunfu C&S 15,000 3,600 None None No No
30, 2022 2023 liability 2027.4.19
guarante
e
Joint
and
November November 20,00 several 2022.11.23-
Yunfu C&S 20,000 None None No No
30, 2021 23, 2022 0 liability 2026.11.7
guarante
e
Joint
and
November January 4,477. several 2023.1.17-
Yunfu C&S 7,000 None None No No
23, 2022 17, 2023 55 liability 2026.11.29
guarante
e
Joint
and
November May 25, 1,530. several 2023.5.25-
Yunfu C&S 10,000 None None No No
23, 2022 2023 37 liability 2027.4.18
guarante
e
Joint
November February and 2023.2.13-
Hubei C&S 10,000 0 None None No No
23, 2022 13, 2023 several 2030.11.2
liability
42
C&S Paper Co., Ltd. Semi-annual Report 2023
guarante
e
Joint
and
Dazhou November February several 2023.2.13-
10,000 0 None None No No
C&S 23, 2022 13, 2023 liability 2029.11.2
guarante
e
Joint
Jiangmen and
C&S, Yunfu November January several 2022.1.17-
22,000 0 None None No No
C&S and 30, 2021 17, 2022 liability 2026.1.17
Hubei C&S guarante
e
C&S Hong Joint
Kong, and
Zhong Shun November November 6,829. several 2022.11.14-
36,377 None None No No
Internationa 30, 2021 14, 2022 59 liability 2027.7.31
l, Macao guarante
C&S e
Joint
C&S Hong
and
Kong and
November September several 2021.9.8-
Zhong Shun 18,844.49 0 None None No No
20, 2020 8, 2021 liability 2024.9.8
Internationa
guarante
l
e
Joint
and
C&S Hong
November March 17, 2,578. several 2021.3.17-
Kong and 37,132 None None No No
20, 2020 2021 25 liability 2025.12.31
Macao C&S guarante
e
C&S Hong Joint
Kong, and
Zhong Shun November January 24,29 several 2023.1.20-
46,198.79 None None No No
Internationa 23, 2022 20, 2023 8.11 liability 2026.1.20
l, Macao guarante
C&S e
Joint
and
C&S Hong November November several 2022.11.17-
7,275.4 0 None None No No
Kong 30, 2021 17, 2022 liability 2029.10.28
guarante
e
Joint
and
November November several 2022.11.17-
Macao C&S 7,275.4 0 None None No No
30, 2021 17, 2022 liability 2029.10.28
guarante
e
Joint
and
C&S Hong
December March 27, several 2020.3.27-
Kong and 17,460.96 0 None None No No
5, 2019 2020 liability 2025.8.22
Macao C&S guarante
e
C&S Hong November 21,826.2 March 29, 2,122. Joint None None 2023.3.29- No No
43
C&S Paper Co., Ltd. Semi-annual Report 2023
Kong and 23, 2022 2023 87 and 2026.3.29
Zhong Shun several
Internationa liability
l guarante
e
Joint
and
December March 23, 1,202. several 2018.3.23-
Macao C&S 8,002.94 None None No No
15, 2017 2018 74 liability 2024.9.23
guarante
e
Joint
and
December August 1,499. several 2018.8.15-
Macao C&S 7,000 None None No No
15, 2017 15, 2018 84 liability 2025.8.15
guarante
e
Joint
and
November November 13,60 several 2021.11.12-
Macao C&S 21,826.2 None None No No
20, 2020 12, 2021 1.25 liability 2024.10.20
guarante
e
Joint
and
C&S Hong November September 3,321. several 2022.9.1-
14,550.8 None None No No
Kong 30, 2021 1, 2022 47 liability 2024.9.1
guarante
e
Joint
C&S Hong
and
Kong and
November April 24, several 2023.4.24-
Zhong Shun 21,826.2 0 None None No No
23, 2022 2023 liability 2026.2.22
Internationa guarante
l e
Total actual
amount of
Total approved amount of
guarantee for
guarantee for subsidiaries
286,851.19 subsidiaries 69,904.77
during the reporting
during the
period (B1)
reporting period
(B2)
Total actual
Total approved amount of guarantee balance
guarantee for subsidiaries to subsidiaries at
629,596.38 178,165.19
at the end of the reporting the end of the
period (B3) reporting period
(B4)
Guarantee of subsidiaries to subsidiaries
Whe Whe
Disclosure
ther ther
date of Actual
Actual it it is
Name of relevant guaran Collat Counter
Guarantee date of Guarant Guarantee has relat
guarantee announce tee eral (if guarantee
limit occurrenc ee type period been ed
object ment on amoun any) (if any)
e com part
guarantee t
plete y
limit
d guar
44
C&S Paper Co., Ltd. Semi-annual Report 2023
ante
e
Total amount of the Company’s guarantee (the sum of the first three items)
Total actual
Total approved amount of amount of
guarantee during the guarantee during
286,851.19 87,764.77
reporting period (A1 + B1 the reporting
+ C1) period (A2 + B2 +
C2)
Total actual
Total approved amount of
guarantee balance
guarantee at the end of the
668,096.38 at the end of the 196,025.19
reporting period (A3 + B3
reporting period
+ C3)
(A4+B4+C4)
Proportion of the total actual amount of guarantee
37.57%
(A4 + B4 + C4) in the net assets of the Company
Wherein:
Balance of guarantee for shareholders, actual
0
controllers and their related parties (D)
Balance of debt guarantee provided directly or
indirectly for objects whose asset-liability ratio 75,615.94
exceeds 70% (E)
Amount of guarantees in excess of 50% of net assets
0
(F)
Total amount of the above three guarantees (D + E +
75,615.94
F)
Description of situations that the guarantee liability
has occurred or there is evidence showing that the
Company may be jointly and severally liable for None
undue guarantee contracts during the reporting period
(if any)
Proportion of the total actual amount of guarantee
No
(A4 + B4 + C4) in the net assets of the Company
Detailed description on the guarantees with different types: None
3. Entrusted wealth management
√ Applicable □ Not applicable
Unit: RMB10,000
Amount overdue
Source of Incurred amount
Amount but not recovered
entrusted wealth of entrusted
Specific type Undue balance overdue but with impairment
management wealth
not recovered having been
funds management
accrued
Wealth management product
Self-owned fund 54,060 53,060.7 0 0
of securities company
Total 4,500 53,060.7 0 0
Explanation of high-risk entrusted wealth management with large individual amount or low safety, poor liquidity
and no principal guarantee
□ Applicable √ Not applicable
45
C&S Paper Co., Ltd. Semi-annual Report 2023
Entrusted wealth management is expected to fail to recover the principal or there are other circumstances that may
lead to impairment
□ Applicable √ Not applicable
4.Other significant contracts
□ Applicable √ Not applicable
There were no other significant contracts during the reporting period.
XIII. Other Significant Events
□ Applicable √ Not applicable
XIV. Significant Events of Subsidiaries of the Company
√ Applicable □ Not applicable
1. External investments
(1) In February 2023, in order to further advance the construction and operation of Sichuan Dazhou project, C&S
(Dazhou) Paper Co., Ltd., a subsidiary of the Company, acquired 100% equities of Quxian Jiezhu Construction and
Development Co., Ltd. Quxian Jiezhu Construction and Development Co., Ltd. completed the change registration
with the industrial and commercial department in March 2023, with a registered capital of RMB10 million after the
change.
(2) In June 2023, the Company set up the Guangdong Laotongxue Information Technology Co., Ltd. in Zhongshan，
Guangdong.
2. Changes of industrial and commercial registration
(1) The subsidiaries Hubei C&S, Dazhou C&S, and Yunfu C&S changed their respective legal representatives due
to business development needs. The subsidiaries completed the change procedures with relevant industrial and
commercial departments and obtained the new business licenses during the reporting period.
(2) In April 2023, the subsidiary Zhongshun Healthy Life completed the cancellation procedures due to business
development needs
(3) In June 2023, the subsidiary Hubei C&S changed its business scope due to business development needs.
46
C&S Paper Co., Ltd. Semi-annual Report 2023
Section VII Changes in Shareholding and Information of
Shareholders
I. Changes in Share Capital
1. Changes in shares
Unit: share
Before change Increase/decrease (+, -) of this change After change
B
Shares
on
transferr
Percenta New shares us Percenta
Number ed from Others Subtotal Number
ge issued sh ge
surplus
ar
reserve
es
I. Shares subject
to selling 19,726,128 1.50% 20,961,500 -1,793,172 19,168,328 38,894,456 2.91%
restrictions
1. Shares held
by the state
2. Shares held
by state-owned
legal person
3. Shares held
by other domestic 19,394,703 1.47% 20,861,500 -1,710,316 19,151,184 38,545,887 2.89%
shareholders
Including:
Shares held by
domestic legal
persons
Shares
held by domestic 19,394,703 1.47% 20,861,500 -1,710,316 19,151,184 38,545,887 2.89%
natural persons
4. Shares held
by foreign 331,425 0.03% 100,000 -82,856 17,144 348,569 0.03%
shareholders
Including:
Shares held by
foreign legal
persons
Shares
held by foreign 331,425 0.03% 100,000 -82,856 17,144 348,569 0.03%
natural persons
II. Shares without
1,295,184,477 98.50% 752,631 -281,264 471,367 1,295,655,844 97.09%
selling restrictions
1. RMB-
denominated 1,295,184,477 98.50% 752,631 -281,264 471,367 1,295,655,844 97.09%
ordinary shares
2. Domestic
listed foreign
shares
47
C&S Paper Co., Ltd. Semi-annual Report 2023
3. Overseas
listed foreign
shares
4. Others
III. Total number 100.00 100.00
1,314,910,605 21,714,131 -2,074,436 19,639,695 1,334,550,300
of shares % %
Explanation on changes in shares
√ Applicable □ Not applicable
1. During the reporting period, vesting incentive recipients of first-granted stock options under the 2018 Stock
Option and Restricted Stock Incentive Plan exercised the rights of 752,630 shares, and recipients of reserved stock
options exercised the rights of 1 share; a total of 752,631 shares were exercised. As a result, the Company’s total
share capital increased by 752,631 shares.
2. During the reporting period, in the third unlock period for the reserved restricted shares awarded under the 2018
Stock Option and Restricted Stock Incentive Plan, eight incentive recipients lost the incentive qualification since
they left the Company prior to the unlock; meanwhile, seven incentive recipients could only unlock a proportion of
the shares since they passed the performance appraisal but failed to get a full mark. For the involved 15 incentive
recipients due to the foregoing reasons, a total of 178,536 restricted shares needed to be repurchased and canceled.
As of February 2023, the repurchase and cancellation procedures had been completed for the aforesaid restricted
shares. As a result, the Company’s total share capital decreased by 178,536 shares.
3. In March 2023, the Company completed the registration procedures for the first-granted restricted shares under
the 2022 Stock Option and Restricted Stock Incentive Plan under the review and confirmation of the Shenzhen Stock
Exchange and Shenzhen Branch of China Securities Depository and Clearing Corporation Limited. A total of
20,961,500 shares were awarded to 617 recipients. After the registration was completed, the Company’s total share
capital increased by 20,961,500 shares.
4. In May 2023, the Company deregistered 1,895,900 shares in its specialized repurchase securities account,
accounting for 0.14% of its total share capital before the deregistration. Upon the completion of this deregistration,
there are 24,863,087 shares in its specialized repurchase securities account, and the Company’s total share capital
decreased by 1,895,900 shares accordingly.
Approval of changes in shares
√ Applicable □ Not applicable
1. The Board of Directors’ handling of the exercise matters for the third exercise period of first-granted and restricted
stock options under the 2018 Stock Option and Restricted Stock Incentive Plan has been authorized by the 2019
First Extraordinary General Meeting, and reviewed and approved by the 14th meeting of the Fifth Board of Directors,
the 9th meeting of the Fifth Board of Supervisors, the 17th meeting of the Fifth Board of Directors, and the 12th
meeting of the Fifth Board of Supervisors.
2. The Board of Directors’ handling of the repurchase and deregistration matters for the third unlock of reserved
restricted shares under the 2018 Stock Option and Restricted Stock Incentive Plan has been reviewed and approved
48
C&S Paper Co., Ltd. Semi-annual Report 2023
by the 17th meeting of the Fifth Board of Directors, the 12th meeting of the Fifth Board of Supervisors, and the
2022 Fourth Extraordinary General Meeting.
3. The Board of Directors’ handling of the registration matters for the first-granted restricted shares under the 2022
Stock Option and Restricted Stock Incentive Plan has been authorized by the 2023 First Extraordinary General
Meeting and reviewed and approved by the 19th meeting of the Fifth Board of Directors and 14th meeting of the
Fifth Board of Supervisors.
4. The Board of Directors’ handling of the cancellation matters for partial shares in the specialized repurchase
securities account has been reviewed and approved by the 21st meeting of the Fifth Board of Directors, the 16th
meeting of the Fifth Board of Supervisors, and 2022 Annual General Meeting of Shareholders.
Transfer of title of changed shares
√ Applicable □ Not applicable
Refer to “Explanation on changes in shares”.
Implementation of share repurchase
□ Applicable √ Not applicable
Implementation of share repurchase by centralized bidding
□ Applicable √ Not applicable
Impact of share changes on basic earnings per share and diluted earnings per share, net assets per share attributable
to ordinary shareholders of the Company, and other financial indicators in last year and the latest period
√ Applicable □ Not applicable
Given that the Company's total share capital has changed during the reporting period, the basic earnings per share
and diluted earnings per share, net assets per share attributable to ordinary shareholders of the Company, and other
financial indicators in last year and the latest period were diluted accordingly.
Other contents considered necessary by the Company or required to be disclosed by the securities regulatory
authority
□ Applicable √ Not applicable
2. Changes in shares subject to selling restrictions
√ Applicable □ Not applicable
Unit: share
Number of
Increase in
Number of shares Number of
shares
shares subject released shares subject
Shareholder’s subject to Date of release
to selling from to selling Reason for Selling
name selling from selling
restrictions at selling restrictions at restrictions
restrictions restrictions
the beginning restrictions the end of the
during the
of the period during the year
period
period
49
C&S Paper Co., Ltd. Semi-annual Report 2023
Deng Lock-up shares of senior
5,064,608 5,064,608
Yingzhong management
Lock-up shares of senior
Liu Peng 45,975 45,975
management
Lock-up shares of senior
Deng Guanbiao 3,718,105 929,526 2,788,579 Selling
management
restrictions
Lock-up shares of senior
Deng Guanjie 900,730 225,183 675,547 were released
management
according to
Lock-up shares of senior
Zhang Yang 157,500 157,500 relevant
management
Lock-up shares of senior regulations on
Yue Yong 7,248,930 7,248,930 the
management
Lock-up shares of senior shareholding of
Zhao Ming 26,250 26,250 directors,
management
Lock-up shares of senior supervisors and
Lin Tiande 238,141 238,141 senior
management
Lock-up shares of senior management.
Dong Ye 197,794 197,794
management
Lock-up shares of senior
Chen Haiyuan 12,675 12,675
management
Lock-up shares of senior
Zhang Gao 32,000 5,500 37,500
management
Selling
restrictions
were released
Lock-up shares of senior according to
management; the relevant
Other increase in restricted regulations on
1,904,884 465,427 1,439,457
shareholders shares is due to the the
locking of shares upon shareholding of
directors,
resignation.
supervisors and
senior
management.
The Company awarded The Company
20,961,500 restricted handled and
shares to incentive completed the
recipients under the first cancellation
grant in accordance with procedures in
the 2022 Stock Option February 2023
and Restricted Stock since they did
Incentive Plan, which not meet the
will be unlocked in three unlocking
periods. conditions
prescribed in
Equity
the 2018 Stock
incentive 178,536 178,536 20,961,500 20,961,500
Option and
recipients
Restricted
Stock Incentive
Plan. The
unlocking is
implemented
according to
2022 Stock
Option and
Restricted
Stock Incentive
Plan.
Total 19,726,128 1,798,672 20,967,000 38,894,456 -- --
50
C&S Paper Co., Ltd. Semi-annual Report 2023
II. Issuance and Listing of Securities
□ Applicable √ Not applicable
III. Total Number of Shareholders and Shareholding
Unit: share
Total number of ordinary
Total number of preferred shareholders whose
shareholders as at the end
113,490 voting rights were resumed at the end of the 0
of the reporting period
reporting period (if any) (see Note VIII)
Shareholdings of ordinary shareholders with more than 5% or the top 10 ordinary shareholders
Increase Pledged, marked or frozen
Number of Number of
Shareho /decreas Number of
ordinary shares ordinary shares
Name of Nature of lding e during ordinary shares
held at the end of held subject to Share
shareholder shareholder percenta the held without Number of shares
the reporting selling
ge (%) reportin selling restrictions status
period restrictions
g period
Guangdong Domestic
Zhongshun non-state-
Paper owned 28.26% 377,195,570 377,195,570
Group Co., legal
Ltd. person
Foreign
Chung
legal 19.97% 266,504,789 266,504,789
Shun Co.
person
Hong Kong
Foreign
Securities Share
legal 3.83% 51,148,846 51,148,846
Clearing increase
person
Co., Ltd.
Ernest
Partners Foreign
Share
LLC — legal 0.90% 11,991,400 11,991,400
Client person increase
funds
Domestic
Share
Yue Yong natural 0.81% 10,765,241 8,348,930 2,416,311
person increase
Domestic
Deng
natural 0.51% 6,752,811 5,064,608 1,688,203
Yingzhong
person
Guohua
Life —
Share
Xingyi Others 0.47% 6,224,600 6,224,600
Traditional increase
No.2
#
Domestic
Zhongshan
non-state-
Xinda
owned 0.46% 6,123,636 6,123,636
Investment
legal
Manageme
person
nt Co., Ltd.
ICBC —
CSI Main
Share
Consumer Others 0.38% 5,019,699 5,019,699
increase
Staples
ETF
51
C&S Paper Co., Ltd. Semi-annual Report 2023
ABC —
Share
CSI
Others 0.33% 4,436,889 reductio 4,436,889
Smallcap
n
500 ETF
Strategic investors or
general legal persons
becoming top ten
shareholders due to Not applicable
private placement of new
shares (if any) (see Note
3)
1. Among the top ten shareholders mentioned above, Mr. Deng Yingzhong is among the actual controllers of the
Description on the related Company; Guangdong Zhongshun Paper Group Co., Ltd. and Chung Shun Co. are the enterprises controlled by
relationship or parties actual controllers of the Company, i.e. Mr. Deng Yingzhong, Deng Guanbiao and Deng Guanjie. That is,
acting-in-concert Guangdong Zhongshun Paper Group Co., Ltd. and Chung Shun Co. are related parties. Mr. Yue Yong is an
arrangements among the incumbent senior manager of the Company.
above shareholders 2. Except for the above situation, it is unknown to the Company whether there is related party relationship among
other shareholders, or whether there is acting-in-concert among other shareholders.
Description on
entrusting/being entrusted
with voting rights and
Not applicable
waver of voting rights by
the aforementioned
shareholders:
Description on special
There is a special repurchase account “C&S Paper Special Repurchase Securities Account” among the top 10
repurchase account among
shareholders. As of the end of the reporting period, this repurchase account held 24,863,087 shares, with a
top 10 shareholders (if
shareholding ratio of 1.86%. Pursuant to relevant regulations, it is not included in the list of top 10 shareholders.
any) (see note 10)
Shareholdings of top 10 shareholders not subject to selling restrictions
Type of shares
Name of shareholder Number of shares held not subject to selling restrictions
Type of shares Number
RMB-
Guangdong Zhongshun
377,195,570 denominated 377,195,570
Paper Group Co., Ltd.
ordinary shares
RMB-
Chung Shun Co. 266,504,789 denominated 266,504,789
ordinary shares
RMB-
Hong Kong Securities
51,148,846 denominated 51,148,846
Clearing Co., Ltd.
ordinary shares
RMB-
Ernest Partners LLC —
11,991,400 denominated 11,991,400
Client funds
ordinary shares
RMB-
Guohua Life — Xingyi
6,224,600 denominated 6,224,600
Traditional No.2
ordinary shares
# Zhongshan Xinda RMB-
Investment Management 6,123,636 denominated 6,123,636
ordinary shares
Co., Ltd.
RMB-
ICBC — CSI Main
5,019,699 denominated 5,019,699
Consumer Staples ETF ordinary shares
RMB-
ABC — CSI Smallcap
4,436,889 denominated 4,436,889
500 ETF ordinary shares
RMB-
# Chen Ruiqiang 3,667,600 denominated 3,667,600
ordinary shares
RMB-
Yuan Xuemei 3,592,000 denominated 3,592,000
ordinary shares
Description on the related 1. Among the top ten shareholders mentioned above, Guangdong Zhongshun Paper Group Co., Ltd. and Chung
relationship or parties Shun Co. are the enterprises controlled by actual controllers of the Company, i.e. Mr. Deng Yingzhong, Mr. Deng
52
C&S Paper Co., Ltd. Semi-annual Report 2023
acting-in-concert among Guanbiao and Mr. Deng Guanjie. That is, Guangdong Zhongshun Paper Group Co., Ltd. and Chung Shun Co. are
the top ten ordinary related parties.
shareholders without 2. Except for the above situation, it is unknown to the Company whether there is related party relationship among
selling restrictions and other shareholders, or whether there is acting-in-concert among other shareholders.
between the top ten
ordinary shareholders
without selling restrictions
and the top ten ordinary
shareholders
Description on the top 10
ordinary shareholders’ 1. Shareholder Zhongshan Xinda Investment Management Co., Ltd. holds 6,120,602 shares through a client credit
participation in margin transaction guarantee securities account.
trading and securities 2. Shareholder Chen Ruiqiang holds 843, 500 shares through a client credit transaction guarantee securities
lending business (if any) account.
(see Note 4)
Whether the top ten ordinary shareholders and the top ten shareholders without selling restrictions conducted the
agreed repurchase transaction during the reporting period
□ Yes √ No
The Company’s top ten ordinary shareholders and top ten ordinary shareholders without selling restrictions did
not conduct agreed repurchase transactions during the reporting period.
IV. Changes in Shareholding of Directors, Supervisors and Senior Management
√ Applicable □ Not applicable
Number
of
shares Number
Number
subject of shares
of shares
Number of Decreas to subject to
Increase Number of subject to
Positi shares held e of selling selling
of shares shares held selling
Name Position on at the shares restricti restriction
during the at the end of restriction
status beginning of during ons s granted
year the year s granted
the year the year granted at the end
in the
at the of the
period
beginnin period
g of the
period
Deng
Incum
Yingzhon Director 6,752,811 6,752,811
bent
g
Chairman, Incum
Liu Peng 61,300 1,500,000 1,561,300 1,500,000 1,500,000
President bent
Deng Vice Incum
3,718,105 3,718,105
Guanbiao Chairman bent
Deng Vice Incum
900,730 900,730
Guanjie Chairman bent
Director,
Zhang Incum
Vice 210,000 1,500,000 1,710,000 1,500,000 1,500,000
Yang bent
President
Yu Ep.
Incum
Rachel Director
bent
Jing
Ge Independe Incum
Guangrui nt Director bent
53
C&S Paper Co., Ltd. Semi-annual Report 2023
He Independe Incum
Guoquan nt Director bent
Independe Incum
Liu Die nt Director bent
Vice Incum
Yue Yong President 9,665,241 1,100,000 10,765,241 1,100,000 1,100,000
bent
Zhao Vice Incum
President 35,000 300,000 335,000 300,000 300,000
Ming bent
Lin Vice Incum
President 317,521 500,000 817,521 500,000 500,000
Tiande bent
Board
Zhang Secretary, Incum
400,000 400,000 400,000 400,000
Haijun Vice bent
President
Chief
Incum
Dong Ye Financial 263,725 300,000 563,725 300,000 300,000
bent
Officer
Chairman
of the
Chen Incum
Board of 16,900 16,900
Haiyuan bent
Supervisor
s
Liang Supervisor Incum
Yongliang bent
Zhang Supervisor Incum
50,000 50,000
Gao bent
Independe Resig
He Haidi ned
nt Director
合计 -- -- 21,991,333 5,600,000 0 27,591,333 0 5,600,000 5,600,000
V. Changes of Shareholders and Actual Controllers
Changes of controlling shareholders during the reporting period
□ Applicable √ Not applicable
There was no change of the Company’s controlling shareholder during the reporting period.
Changes of actual controllers during the reporting period
□ Applicable √ Not applicable
There was no change of the Company’s actual controllers during the reporting period.
54
C&S Paper Co., Ltd. Semi-annual Report 2023
Section VIII Particulars of Preference Shares
□ Applicable √ Not applicable
The Company had no preference shares during the reporting period.
55
C&S Paper Co., Ltd. Semi-annual Report 2023
Section IX Corporate Bonds
□ Applicable √ Not applicable
56
C&S Paper Co., Ltd. Semi-annual Report 2023
Section X Financial Report
I. Audit Report
Whether the Semi-annual Report has been audited
□ Yes √ No
The Semi-annual Report of the Company has not been audited.
II. Financial Statements
Unit of financial statements: RMB
1. Consolidated balance sheet
Prepared by: C&S Paper Co., Ltd.
June 30，2023
Unit: RMB
Item June 30, 2023 January 01, 2023
Current assets:
Monetary funds 1,720,158,431.51 1,324,787,541.49
Settlement reserve
Lending to banks and other
financial institutions
Tradable financial assets
Derivative financial assets
Notes receivable 11,389,001.93 11,371,092.80
Accounts receivable 1,173,731,203.91 1,084,130,138.51
Accounts receivable financing
Prepayments 15,250,103.86 15,291,351.73
Premium receivable
Reinsurance payables
Reinsurance contract reserves
receivable
Other receivables 15,877,583.96 16,915,272.60
Including: Interest receivable
Dividends receivable
Financial assets held under resale
agreements
Inventory 1,241,142,975.60 1,911,630,723.55
Contract assets
Assets held for sale
Non-current assets due within one
year
Other current assets 1,157,947,360.89 334,959,353.91
Total current assets 5,335,496,661.66 4,699,085,474.59
57
C&S Paper Co., Ltd. Semi-annual Report 2023
Non-current assets:
Loans and advances to customers
Investments in creditor’s rights
Investments in other creditor’s
rights
Long-term receivable
Long-term equity investment
Investment in other equity
instruments
Other non-current financial assets
Investment property 30,983,155.44 31,701,597.54
Fixed assets 2,848,133,013.46 3,013,559,312.97
Construction work in progress 167,569,837.60 142,627,123.42
Productive biological assets
Oil & gas assets
Right-of-use assets 15,812,608.61 9,758,283.42
Intangible assets 217,157,292.86 214,243,938.48
Development expenses
Goodwill 697,790.49 64,654.15
Long-term deferred expenses 12,857,646.13 11,771,615.74
Deferred income tax assets 243,248,809.65 206,456,657.06
Other non-current assets 42,134,678.89 5,839,034.34
Total non-current assets 3,578,594,833.13 3,636,022,217.12
Total assets 8,914,091,494.79 8,335,107,691.71
Current liabilities:
Short-term borrowings 1,166,297,275.02 607,799,222.62
Borrowings from PBC
Placements from banks and other
financial institutions
Tradable financial liabilities
Derivative financial liabilities
Notes payable 326,437,678.21 340,335,111.30
Accounts payable 809,845,342.70 948,550,430.61
Payments received in advance
Contract liabilities 55,853,584.65 96,581,944.94
Proceeds from financial assets sold
under repo
Customer bank deposits and due to
banks and other financial institutions
Funds from securities trading
agency
Funds from securities underwriting
agency
Employee remuneration payable 110,494,448.39 131,641,447.65
Tax and fees payable 126,820,329.67 53,457,966.35
Other payables 950,315,173.71 807,423,814.13
Including: Interests payable
Dividends payable 1,299,613.00
Transaction fee and commission
receivable
Reinsurance payable
Liabilities held for sale
Non-current liabilities due within
8,708,819.36 9,833,661.30
one year
Other current liabilities 7,191,894.60 12,440,147.55
58
C&S Paper Co., Ltd. Semi-annual Report 2023
Total current liabilities 3,561,964,546.31 3,008,063,746.45
Non-current liabilities:
Insurance contract reserves
Long-term borrowings
Bonds payable
Including: Preference shares
Perpetual bonds
Lease liabilities 8,675,066.94 803,879.30
Long-term payable
Long-term employee remuneration
payable
Provision
Deferred income 90,477,103.14 98,419,983.82
Deferred income tax liabilities 28,007,494.21 47,131,368.70
Other non-current liabilities
Total non-current liabilities 127,159,664.29 146,355,231.82
Total liabilities 3,689,124,210.60 3,154,418,978.27
Owner’s equity:
Share capital 1,334,550,300.00 1,314,739,745.00
Other equity instruments
Including: Preference shares
Perpetual bonds
Capital reserve 1,079,098,155.93 958,187,997.99
Less: Treasury shares 793,726,652.23 688,930,693.99
Other comprehensive income
Special reserves
Surplus reserves 145,882,689.86 145,882,689.86
General reserves
Retained earnings 3,451,470,206.87 3,448,180,639.62
Total equity attributable to owners of the
5,217,274,700.43 5,178,060,378.48
parent company
Equities of minority shareholders 7,692,583.76 2,628,334.96
Total owner’s equity 5,224,967,284.19 5,180,688,713.44
Total liabilities and owners’ equities 8,914,091,494.79 8,335,107,691.71
Legal representative: Liu Peng Person in charge of accounting: Dong Ye Person in charge of accounting
department: Xu Xianjing
2. Balance sheet of the Parent Company
Unit: RMB
Item June 30, 2023 January 01, 2023
Current assets:
Monetary funds 248,234,112.29 178,834,482.59
Tradable financial assets
Derivative financial assets
Notes receivable
Accounts receivable 100,492,759.26 138,731,752.81
Accounts receivable financing
Prepayments 3,443,680.59 3,400,385.20
Other receivables 101,551,635.79 226,320,859.44
Including: Interest receivable
Dividends receivable
Inventory 106,400,059.82 230,991,334.76
59
C&S Paper Co., Ltd. Semi-annual Report 2023
Contract assets
Assets held for sale
Non-current assets due within one
year
Other current assets 607,900,660.78 44,612,167.11
Total current assets 1,168,022,908.53 822,890,981.91
Non-current assets:
Investments in creditor’s rights
Investments in other creditor’s
rights
Long-term receivable
Long-term equity investment 2,063,642,700.23 2,007,893,370.09
Investment in other equity
instruments
Other non-current financial assets
Investment property 15,992,500.81 16,381,866.55
Fixed assets 364,026,178.37 370,818,585.12
Construction work in progress 99,460,591.37 106,508,939.88
Productive biological assets
Oil & gas assets
Right-of-use assets 6,035,863.64 1,870,924.32
Intangible assets 24,757,576.36 24,849,828.82
Development expenses
Goodwill
Long-term deferred expenses 229,008.85 286,261.03
Deferred income tax assets 111,944,828.60 103,318,801.75
Other non-current assets 1,950,184.45 2,615,866.30
Total non-current assets 2,688,039,432.68 2,634,544,443.86
Total assets 3,856,062,341.21 3,457,435,425.77
Current liabilities:
Short-term borrowings 150,109,375.00
Tradable financial liabilities
Derivative financial liabilities
Notes payable 45,000,000.00 45,000,000.00
Accounts payable 611,653,864.27 830,007,886.80
Payments received in advance
Contract liabilities 130,085,518.13 117,155,526.88
Employee remuneration payable 31,262,433.35 45,625,887.77
Tax and fees payable 8,107,054.87 2,218,640.09
Other payables 197,536,171.30 69,251,084.96
Including: Interests payable
Dividends payable 1,299,613.00
Liabilities held for sale
Non-current liabilities due within
2,339,301.07 1,745,137.58
one year
Other current liabilities 16,911,117.36 15,230,218.49
Total current liabilities 1,193,004,835.35 1,126,234,382.57
Non-current liabilities:
Long-term borrowings
Bonds payable
Including: Preference shares
Perpetual bonds
Lease liabilities 4,307,197.55 324,786.03
Long-term payable
Long-term employee remuneration
payable
60
C&S Paper Co., Ltd. Semi-annual Report 2023
Provision
Deferred income 2,837,088.65 3,440,764.37
Deferred income tax liabilities 13,991,614.43
Other non-current liabilities
Total non-current liabilities 7,144,286.20 17,757,164.83
Total liabilities 1,200,149,121.55 1,143,991,547.40
Owner’s equity:
Share capital 1,334,550,300.00 1,314,739,745.00
Other equity instruments
Including: Preference shares
Perpetual bonds
Capital reserve 1,002,791,189.93 881,881,031.99
Less: Treasury shares 793,726,652.23 688,930,693.99
Other comprehensive income
Special reserves
Surplus reserves 145,761,355.58 145,761,355.58
Retained earnings 966,537,026.38 659,992,439.79
Total owner’s equity 2,655,913,219.66 2,313,443,878.37
Total liabilities and owners’ equities 3,856,062,341.21 3,457,435,425.77
3. Consolidated income statement
Unit: RMB
Item Half-Year of 2023 Half-Year of 2022
I. Total Operating Income 4,685,080,565.59 4,367,618,113.61
Including: Operating income 4,685,080,565.59 4,367,618,113.61
Interest income
Gross earned premiums
Service charge and
commission income
II. Total Operating Cost 4,613,353,728.19 4,116,050,602.19
Including: Operating costs 3,352,956,520.74 2,929,313,606.05
Interest expenses
Service charge and
commission expenses
Surrender value
Net compensation expenses
Net appropriation of
insurance reserve
Policy dividends expenses
Reinsurance costs
Tax and surcharges 30,686,345.75 28,804,761.00
Selling expenses 937,125,533.37 874,040,563.35
Administrative expenses 188,774,711.51 180,176,434.40
R&D expenses 120,281,401.12 105,182,287.61
Finance expenses -16,470,784.30 -1,467,050.22
Including: Interest fees 14,597,955.07 1,730,495.87
Interest income 16,545,337.34 5,594,433.94
Plus: Other income 12,741,933.39 13,819,921.40
Return on investment (“-”
1,958,155.36 183,493.42
indicates loss)
Including: Return on
investment in associates and joint
ventures
61
C&S Paper Co., Ltd. Semi-annual Report 2023
Income from the
derecognition of financial assets
measured at amortized cost
Exchange gains (“-” indicates
loss)
Gains from net exposure
hedging (“-” indicates loss)
Gains from changes in fair
-2,538.48
value (“-” indicates loss)
Credit impairment losses (“-”
-1,764,899.61 1,833,293.54
indicates loss)
Asset impairment losses (“-”
-1,417,159.06 -1,026,689.87
indicates loss)
Return on disposal of assets
-919,217.75 -1,085,279.69
(“-” indicates loss)
III. Operating Profit (“-” indicates loss) 82,325,649.73 265,289,711.74
Plus: Non-operating income 3,592,734.66 1,914,737.14
Less: Non-operating expenditure 3,821,260.22 5,989,215.49
IV. Total Profit (“-” indicates total loss) 82,097,124.17 261,215,233.39
Less: Income tax expense -1,857,299.09 33,733,447.46
V. Net Profit (“-” indicates net loss) 83,954,423.26 227,481,785.93
i. Classified by operation continuity
1. Net profit from continued
83,954,423.26 227,481,785.93
operation (“-” indicates net loss)
2. Net profit from discontinued
operation (“-” indicates net loss)
ii. Classified by attribution of
ownership
1. Net profit attributable to owners
84,490,174.46 227,639,705.35
of the parent company
2. Minority shareholders’ profits
-535,751.20 -157,919.42
and losses
VI. Net Amount of Other Comprehensive
Income after Tax
Total other comprehensive after-tax
net income attributable to owners of the
parent company
i. Other comprehensive income not
able to be reclassified into the profit or
loss
1. Changes of re-
measurement of the defined benefit plan
2. Other comprehensive
income that cannot be transferred into
the profit or loss under equity method
3. Changes in fair value of
investment in other equity instruments
4. Changes in fair value of
credit risk of the enterprise
5. Others
ii. Other comprehensive income
reclassified into the profit or loss
1. Other comprehensive
income to be transferred into the profit or
loss under equity method
2. Changes in fair value of
62
C&S Paper Co., Ltd. Semi-annual Report 2023
investment in other creditor’s rights
3. Financial assets
reclassified into other comprehensive
income
4. Impairment provision for
credit of investment in other creditor’s
rights
5. Reserve of cash flow
hedge
6. Converted difference in
foreign currency financial statements
7. Others
Total other comprehensive after-tax
net income attributable to minority
shareholders
VII. Total Comprehensive Income 83,954,423.26 227,481,785.93
Total comprehensive income
attributable to owners of the parent 84,490,174.46 227,639,705.35
company
Total comprehensive income
-535,751.20 -157,919.42
attributable to minority shareholders
VIII. Earnings per Share:
i. Basic earnings per share 0.06 0.17
ii. Diluted earnings per share 0.06 0.17
For business combinations of the current period under common control, the net profit realized by the combined party before the
combination is: RMB0.00; the net profit realized by the combined party in last period is: RMB0.00.
Legal representative: Liu Peng Person in charge of accounting: Dong Ye Person in charge of accounting
department: Xu Xianjing
4. Income statement of the Parent Company
Unit: RMB
Item Half-Year of 2023 Half-Year of 2022
I. Operating Income 787,073,336.16 1,040,228,094.53
Less: Operating cost 728,588,036.18 934,724,115.97
Tax and surcharges 2,754,473.46 1,444,145.77
Selling expenses 73,233,967.35 83,355,103.02
Administrative expenses 77,316,608.59 78,567,987.49
R&D expenses
Finance expenses -2,290,196.59 13,198,563.52
Including: Interest fees 1,793,163.37 372,903.68
Interest income 2,263,219.06 748,450.43
Plus: Other income 2,521,192.69 4,064,729.62
Return on investment (“-”
456,658,155.36 491,911,145.00
indicates loss)
Including: Return on
investment in associates and joint
ventures
Profits from derecognition
of financial assets at amortized cost
Gains from net exposure
hedging (“-” indicates loss)
63
C&S Paper Co., Ltd. Semi-annual Report 2023
Gains from changes in fair
value (“-” indicates loss)
Credit impairment losses (“-”
-272,095.97 -513,297.02
indicates loss)
Asset impairment losses (“-”
-344,503.16 -351,354.84
indicates loss)
Return on disposal of assets
-822,150.21 136,016.06
(“-” indicates loss)
II. Operating Profit (“-” indicates loss) 365,211,045.88 424,185,417.58
Plus: Non-operating income 555,371.30 352,230.92
Less: Non-operating expenditure 638,864.66 339,798.68
III. Total Profit (“-” indicates total loss) 365,127,552.52 424,197,849.82
Less: Income tax expense -22,617,641.28 -17,504,601.41
IV. Net Profit (“-” indicates net loss) 387,745,193.80 441,702,451.23
i. Net profit from continued
387,745,193.80 441,702,451.23
operation (“-” indicates net loss)
ii. Net profit from discontinued
operation (“-” indicates net loss)
V. Net Amount of Other Comprehensive
Income after Tax
i. Other comprehensive income not
able to be reclassified into the profit or
loss
1. Changes of re-
measurement of the defined benefit plan
2. Other comprehensive
income that cannot be transferred into
the profit or loss under equity method
3. Changes in fair value of
investment in other equity instruments
4. Changes in fair value of
credit risk of the enterprise
5. Others
ii. Other comprehensive income
reclassified into the profit or loss
1. Other comprehensive
income to be transferred into the profit or
loss under equity method
2. Changes in fair value of
investment in other creditor’s rights
3. Financial assets
reclassified into other comprehensive
income
4. Impairment provision for
credit of investment in other creditor’s
rights
5. Reserve of cash flow
hedge
6. Converted difference in
foreign currency financial statements
7. Others
VI. Total Comprehensive Income 387,745,193.80 441,702,451.23
VII. Earnings per Share:
i. Basic earnings per share
ii. Diluted earnings per share
64
C&S Paper Co., Ltd. Semi-annual Report 2023
5. Consolidated cash flow statement
Unit: RMB
Item Half-Year of 2023 Half-Year of 2022
I. Cash Flows from Operating Activities:
Cash received from sale of goods or
4,568,336,033.72 4,390,764,748.02
rendering of services
Net increase in deposits from
customers, banks and non-bank financial
institutions
Net increase in due to central banks
Net increase in placements from
other financial institutions
Net cash from reinsurance business
Net increase in deposits and
investment of the insured
Cash obtained from interest, net fee
and commission
Net cash from reinsurance business
Net increase in placements from
banks and other financial institutions
Net increase in repo service fund
Net cash from agent securities
trading
Tax rebates 34,111,023.87 9,662,927.59
Cash received related to other
60,894,122.70 52,109,531.96
operating activities
Sub-total of cash inflow from operating
4,663,341,180.29 4,452,537,207.57
activities
Cash paid for goods purchased and
2,737,521,266.54 2,526,209,791.30
services rendered
Net loans and advances to
customers
Net increase in deposits with the
central bank, banks and non-bank
financial institutions
Cash paid for claims of direct
insurance contracts
Net increase in placements with
banks and non-bank financial institutions
Cash paid for interest, fee and
commission
Cash paid for dividends of the
insured
Cash paid to and on behalf of
468,248,404.47 487,529,479.85
employees
Tax payments 223,017,991.16 268,061,564.38
Cash payments related to other
461,107,260.06 471,186,646.29
operating activities
Sub-total of cash outflow from operating
3,889,894,922.23 3,752,987,481.82
activities
Net cash flows from operating activities 773,446,258.06 699,549,725.75
II. Cash Flows from Investing Activities:
Cash from realization of investment
Cash received from the return on 1,958,155.36 188,274.88
65
C&S Paper Co., Ltd. Semi-annual Report 2023
investments
Net cash received from the disposal
of fixed assets, intangible assets, and 1,571,529.10 8,896,516.73
other long-term assets
Net amount of cash received from
the disposal of subsidiaries and other
operating organizations
Cash received related to other
93,001,000.00 41,239,541.68
investing activities
Sub-total of cash inflow from investing
96,530,684.46 50,324,333.29
activities
Cash paid for the acquisition and
construction of fixed assets, intangible 111,139,413.00 158,095,067.10
assets, and other long-term assets
Cash paid for investments
Net increase in pledged loans
Net amount of cash paid for
acquisition of subsidiaries and other 5,810,000.00
operating organizations
Cash payments related to other
991,607,000.00 140,000,000.00
investing activities
Sub-total of cash outflow from investing
1,108,556,413.00 298,095,067.10
activities
Net cash flows from investing activities -1,012,025,728.54 -247,770,733.81
III. Cash Flows from Financing
Activities:
Cash received from capital
141,373,794.42 5,345,461.64
contribution
Including: Proceeds received by
subsidiaries from minority shareholders’
investment
Cash received from borrowings 1,277,682,621.27 280,500,000.00
Cash received related to other
5,651,225.68
financing activities
Sub-total of cash inflow from financing
1,424,707,641.37 285,845,461.64
activities
Cash paid for repayments of
711,767,720.66 38,500,000.00
borrowings
Cash payment for interest expenses
93,781,130.44 130,888,041.74
and distribution of dividends or profits
Including: Dividend and profit paid
by subsidiaries to minority shareholders
Cash payments related to other
5,805,962.59 63,238,785.50
financing activities
Sub-total of cash outflow from financing
811,354,813.69 232,626,827.24
activities
Net cash flows from financing activities 613,352,827.68 53,218,634.40
IV. Effect of Exchange Rate Changes on
26,248,758.50 12,379,862.97
Cash and Cash Equivalents
V. Net Increase in Cash and Cash
401,022,115.70 517,377,489.31
Equivalents
Plus: Opening balance of cash and
1,248,898,024.59 797,797,675.70
cash equivalents
VI. Closing Balance of Cash and Cash
1,649,920,140.29 1,315,175,165.01
Equivalents
66
C&S Paper Co., Ltd. Semi-annual Report 2023
6. Cash flow statement of the Parent Company
Unit: RMB
Item Half-Year of 2023 Half-Year of 2022
I. Cash Flows from Operating Activities:
Cash received from sale of goods or
978,479,087.94 887,041,490.22
rendering of services
Tax rebates 2,925,548.55
Cash received related to other
683,421,411.07 172,267,914.07
operating activities
Sub-total of cash inflow from operating
1,661,900,499.01 1,062,234,952.84
activities
Cash paid for goods purchased and
771,865,862.19 829,387,529.96
services rendered
Cash paid to and on behalf of
113,659,917.46 121,130,410.24
employees
Tax payments 12,786,412.51 7,266,606.51
Cash payments related to other
726,907,864.89 293,808,313.12
operating activities
Sub-total of cash outflow from operating
1,625,220,057.05 1,251,592,859.83
activities
Net cash flows from operating activities 36,680,441.96 -189,357,906.99
II. Cash Flows from Investing Activities:
Cash from realization of investment
Cash received from the return on
456,658,155.36 491,911,145.00
investments
Net cash received from the disposal
of fixed assets, intangible assets, and 238,000.00 2,780.00
other long-term assets
Net amount of cash received from
the disposal of subsidiaries and other
operating organizations
Cash received related to other
23,001,000.00 10,000,000.00
investing activities
Sub-total of cash inflow from investing
479,897,155.36 501,913,925.00
activities
Cash paid for the acquisition and
construction of fixed assets, intangible 19,855,136.87 75,347,277.57
assets, and other long-term assets
Cash paid for investments 39,000,000.00 500,000.00
Net amount of cash paid for
acquisition of subsidiaries and other
operating organizations
Cash payments related to other
601,607,000.00
investing activities
Sub-total of cash outflow from investing
660,462,136.87 75,847,277.57
activities
Net cash flows from investing activities -180,564,981.51 426,066,647.43
III. Cash Flows from Financing
Activities:
Cash received from capital
141,373,794.42 5,347,319.15
contribution
Cash received from borrowings 302,158,073.91
Cash received related to other
financing activities
67
C&S Paper Co., Ltd. Semi-annual Report 2023
Sub-total of cash inflow from financing
443,531,868.33 5,347,319.15
activities
Cash paid for repayments of
151,171,765.52
borrowings
Cash payment for interest expenses
81,362,154.79 129,825,291.73
and distribution of dividends or profits
Cash payments related to other
5,154,951.72 24,740,404.55
financing activities
Sub-total of cash outflow from financing
237,688,872.03 154,565,696.28
activities
Net cash flows from financing activities 205,842,996.30 -149,218,377.13
IV. Effect of Exchange Rate Changes on
3,144,664.45 3,308.96
Cash and Cash Equivalents
V. Net Increase in Cash and Cash
65,103,121.20 87,493,672.27
Equivalents
Plus: Opening balance of cash and
178,827,650.10 54,273,414.25
cash equivalents
VI. Closing Balance of Cash and Cash
243,930,771.30 141,767,086.52
Equivalents
68
C&S Paper Co., Ltd. Semi-annual Report 2023
7. Consolidated statement of changes in owner’s equity
Amount of the current period
Unit: RMB
Half-Year of 2023
Owner’s equity attributable to the Parent Company
Other O
equity t
instrume h
nts e
r
S G
c
p e
P o
e n
r P m
c e
e e p
i r
f r r O
a a
e p e t Equity of
Item l l
r e O Less: Treasury h h minority Total owner’s equity
Share capital Capital reserve r Surplus reserves r Retained earnings Subtotal
e t t shares e e shareholders
e e
n u h n r
s s
c a e s s
e e
e l r i
r r
s b s v
v v
h o e
e e
a n i
s s
r d n
e s c
s o
m
e
I. Balance at
1,314,739,745.00 958,187,997.99 688,930,693.99 145,882,689.86 3,448,180,639.62 5,178,060,378.48 2,628,334.96 5,180,688,713.44
the End of
69
C&S Paper Co., Ltd. Semi-annual Report 2023
Last Year
Plus:
Alternation to
accounting
policies
Correction to
previous
errors
Business
combinations
involving
enterprises
under
common
control
Others
II. Balance at
the Beginning 1,314,739,745.00 958,187,997.99 688,930,693.99 145,882,689.86 3,448,180,639.62 5,178,060,378.48 2,628,334.96 5,180,688,713.44
of the Year
III. Changes
in the Period
19,810,555.00 120,910,157.94 104,795,958.24 3,289,567.25 39,214,321.95 5,064,248.80 44,278,570.75
(“-” Indicates
Decrease)
i. Total
comprehensiv 84,490,174.46 84,490,174.46 -535,751.20 83,954,423.26
e income
ii. Capital
contributed or
19,810,555.00 120,910,157.94 104,795,958.24 35,924,754.70 5,600,000.00 41,524,754.70
decreased by
owner
70
C&S Paper Co., Ltd. Semi-annual Report 2023
1 Ordinary
shares
21,706,455.00 119,137,564.99 140,844,019.99 5,600,000.00 146,444,019.99
contributed
by owners
2 Capital
contributed
by owners of
other equity
instruments
3 Share based
payments
recognized as 27,557,414.71 132,476,680.00 -104,919,265.29 -104,919,265.29
owner’s
equity
4 Others -1,895,900.00 -25,784,821.76 -27,680,721.76
iii. Profit
-81,200,607.21 -81,200,607.21 -81,200,607.21
distribution
1
Appropriation
of surplus
reserves
2
Appropriation
of general
risk reserves
3 Distribution
to owners (or -81,200,607.21 -81,200,607.21 -81,200,607.21
shareholders)
4 Others
iv. Interior
balance from
owner’s
equity
71
C&S Paper Co., Ltd. Semi-annual Report 2023
1 Added
capital (or
share capital)
from capital
reserves
2 Added
capital (or
share capital)
from surplus
reserves
3
Compensatio
n of loss with
surplus
reserves
4 Retained
earnings of
carry-over of
the defined
benefit plan
5 Retained
earnings of
carry-over of
other
comprehensiv
e income
6 Others
v. Special
reserves
1
Appropriation
for the period
2 Use for the
72
C&S Paper Co., Ltd. Semi-annual Report 2023
period
vi. Others
IV. Closing
Balance of 1,334,550,300.00 1,079,098,155.93 793,726,652.23 145,882,689.86 3,451,470,206.87 5,217,274,700.43 7,692,583.76 5,224,967,284.19
the Period
Amount of last period
Unit: RMB
Half-Year of 2022
Owner’s equity attributable to the Parent Company
Other O
equity t
instrument h
s e
r S G
c p e
P
o e n
r
m c e
e
p i r
f O
r a a
e Pe t Equity of
Item e l l Total owner’s
r rp O Less: Treasury h minority
Share capital Capital reserve h r Surplus reserves r Retained earnings Subtotal equity
e et t shares e shareholders
e e e
n ua h r
n s s
c l e s
s e e
e bo r
i r r
s nd s
v v v
h s
e e e
a
i s s
r
n
e
c
s
o
m
73
C&S Paper Co., Ltd. Semi-annual Report 2023
e
I. Balance at
the End of 1,312,457,555.00 940,742,686.19 722,243,283.39 106,984,275.42 3,265,611,428.36 4,903,552,661.58 3,246,050.97 4,906,798,712.55
Last Year
Plus:
Alternation to
accounting
policies
Correction to
previous
errors
Business
combinations
involving
enterprises
under
common
control
Others
II. Balance at
the Beginning 1,312,457,555.00 940,742,686.19 722,243,283.39 106,984,275.42 3,265,611,428.36 4,903,552,661.58 3,246,050.97 4,906,798,712.55
of the Year
III. Changes
in the Period
1,324,358.00 7,752,941.45 -24,859,711.16 99,029,994.75 132,967,005.36 -556,662.42 132,410,342.94
(“-” Indicates
Decrease)
i. Total
comprehensiv 227,639,705.35 227,639,705.35 -157,919.42 227,481,785.93
e income
ii. Capital 1,324,358.00 7,752,941.45 -24,859,711.16 33,937,010.61 -398,743.00 33,538,267.61
74
C&S Paper Co., Ltd. Semi-annual Report 2023
contributed or
decreased by
owner
1 Ordinary
shares
1,324,358.00 13,460,603.24 14,784,961.24 -400,000.00 14,384,961.24
contributed by
owners
2 Capital
contributed by
owners of
other equity
instruments
3 Share based
payments
recognized as -5,707,661.79 -24,859,711.16 19,152,049.37 19,152,049.37
owner’s
equity
4 Others 1,257.00 1,257.00
iii. Profit
-128,609,710.60 -128,609,710.60 -128,609,710.60
distribution
1
Appropriation
of surplus
reserves
2
Appropriation
of general risk
reserves
3 Distribution
to owners (or -128,609,710.60 -128,609,710.60 -128,609,710.60
shareholders)
4 Others
iv. Interior
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C&S Paper Co., Ltd. Semi-annual Report 2023
balance from
owner’s
equity
1 Added
capital (or
share capital)
from capital
reserves
2 Added
capital (or
share capital)
from surplus
reserves
3
Compensation
of loss with
surplus
reserves
4 Retained
earnings of
carry-over of
the defined
benefit plan
5 Retained
earnings of
carry-over of
other
comprehensiv
e income
6 Others
v. Special
reserves
1
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C&S Paper Co., Ltd. Semi-annual Report 2023
Appropriation
for the period
2 Use for the
period
vi. Others
IV. Closing
Balance of the 1,313,781,913.00 948,495,627.64 697,383,572.23 106,984,275.42 3,364,641,423.11 5,036,519,666.94 2,689,388.55 5,039,209,055.49
Period
8. Statement of changes in owner’s equity of the Parent Company
Amount of the current period
Unit: RMB
Half-Year of 2023
Other equity instruments Other
Item Prefer Perpet Less: Treasury compreh Special Othe Total owner’s
Share capital Capital reserve Surplus reserves Retained earnings
ence ual Others shares ensive reserves rs equity
shares bonds income
I. Balance at
the End of 1,314,739,745.00 881,881,031.99 688,930,693.99 145,761,355.58 659,992,439.79 2,313,443,878.37
Last Year
Plus:
Alternation to
accounting
policies
Correction to
previous
errors
Others
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C&S Paper Co., Ltd. Semi-annual Report 2023
II. Balance at
the Beginning 1,314,739,745.00 881,881,031.99 688,930,693.99 145,761,355.58 659,992,439.79 2,313,443,878.37
of the Year
III. Changes
in the Period
19,810,555.00 120,910,157.94 104,795,958.24 306,544,586.59 342,469,341.29
(“-” Indicates
Decrease)
i. Total
comprehensiv 387,745,193.80 387,745,193.80
e income
ii. Capital
contributed or
19,810,555.00 120,910,157.94 104,795,958.24 35,924,754.70
decreased by
owner
1 Ordinary
shares
21,706,455.00 119,137,564.99 140,844,019.99
contributed by
owners
2 Capital
contributed by
owners of
other equity
instruments
3 Share based
payments
recognized as 27,557,414.71 132,476,680.00 -104,919,265.29
owner’s
equity
4 Others -1,895,900.00 -25,784,821.76 -27,680,721.76
iii. Profit
-81,200,607.21 -81,200,607.21
distribution
1
Appropriation
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C&S Paper Co., Ltd. Semi-annual Report 2023
of surplus
reserves
2 Distribution
to owners (or -81,200,607.21 -81,200,607.21
shareholders)
3 Others
iv. Interior
balance from
owner’s
equity
1 Added
capital (or
share capital)
from capital
reserves
2 Added
capital (or
share capital)
from surplus
reserves
3
Compensation
of loss with
surplus
reserves
4 Retained
earnings of
carry-over of
the defined
benefit plan
5 Retained
earnings of
carry-over of
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C&S Paper Co., Ltd. Semi-annual Report 2023
other
comprehensiv
e income
6 Others
v. Special
reserves
1
Appropriation
for the period
2 Use for the
period
vi. Others
IV. Closing
Balance of the 1,334,550,300.00 1,002,791,189.93 793,726,652.23 145,761,355.58 966,537,026.38 2,655,913,219.66
Period
Amount of last period
Unit: RMB
Half-Year of 2022
Other equity instruments Other
Item Less: Treasury compreh Special Othe Total owner’s
Share capital Preference Perpetua Capital reserve Surplus reserves Retained earnings
Others shares ensive reserves rs equity
shares l bonds income
I. Balance at
the End of 1,312,457,555.00 863,078,990.57 722,243,283.39 106,862,941.14 438,410,203.56 1,998,566,406.88
Last Year
Plus:
Alternation
to
accounting
policies
Correction
to previous
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C&S Paper Co., Ltd. Semi-annual Report 2023
errors
Others
II. Balance
at the
1,312,457,555.00 863,078,990.57 722,243,283.39 106,862,941.14 438,410,203.56 1,998,566,406.88
Beginning
of the Year
III. Changes
in the
Period (“-” 1,324,358.00 9,114,208.93 -24,859,711.16 313,092,740.63 348,391,018.72
Indicates
Decrease)
i. Total
comprehens 441,702,451.23 441,702,451.23
ive income
ii. Capital
contributed
1,324,358.00 9,114,208.93 -24,859,711.16 35,298,278.09
or decreased
by owner
1 Ordinary
shares
1,324,358.00 13,460,603.24 14,784,961.24
contributed
by owners
2 Capital
contributed
by owners
of other
equity
instruments
3 Share
based
payments
-4,346,394.31 -24,859,711.16 20,513,316.85
recognized
as owner’s
equity
4 Others
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C&S Paper Co., Ltd. Semi-annual Report 2023
iii. Profit
-128,609,710.60 -128,609,710.60
distribution
1
Appropriati
on of
surplus
reserves
2
Distribution
to owners
-128,609,710.60 -128,609,710.60
(or
shareholders
)
3 Others
iv. Interior
balance
from
owner’s
equity
1 Added
capital (or
share
capital)
from capital
reserves
2 Added
capital (or
share
capital)
from surplus
reserves
3
Compensati
on of loss
with surplus
reserves
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C&S Paper Co., Ltd. Semi-annual Report 2023
4 Retained
earnings of
carry-over
of the
defined
benefit plan
5 Retained
earnings of
carry-over
of other
comprehens
ive income
6 Others
v. Special
reserves
1
Appropriati
on for the
period
2 Use for
the period
vi. Others
IV. Closing
Balance of 1,313,781,913.00 872,193,199.50 697,383,572.23 106,862,941.14 751,502,944.19 2,346,957,425.60
the Period
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C&S Paper Co., Ltd. Semi-annual Report 2023
III. Basic Information of the Company
C&S Paper Co., Ltd. (hereinafter referred to as “the Company”) is a joint stock limited company restructured from
Zhongshan Zhongshun Paper Manufacturing Co., Ltd., with all shareholders of the original company as its initiators.
The Company has obtained a business license of enterprise legal person with the registration number of
442000400013713 issued by Guangdong Province Administration for Industry and Commerce on December 31,
2008.
As of June 30, 2023, the registered capital of the company is RMB 1,334,550,300.00, share capital is RMB
1,334,550,300.00.
1. Registered address, form of organization, and headquarters of the Company
Form of organization: Company limited by shares
Registered address: No. 1 Longcheng Road, Dongsheng Town, Zhongshan City
Office address of the headquarters of the Company: No. 136 Caihong Avenue, West District, Zhongshan City
2. Business nature and main business activities of the Company
C&S Paper Co., Ltd. and its subsidiaries (hereafter generally referred to as “the Company”) are in the household
paper industry. The Company mainly engages in the following: R&D, production, processing and sales (including
online sales): high-end household paper series products, tissue boxes, sanitary products, cosmetics, non-woven
products, daily necessities (limited to daily plastic products, daily metal products, daily rubber products, and daily
ceramic products), daily chemical products (excluding hazardous chemicals), and Class I medical devices; operation
and production of Class II and Class III medical devices.
3. Actual controller of the Company
The actual controllers of the Company are Deng Yingzhong, Deng Guanbiao, and Deng Guanjie (Deng Yingzhong
is the other two’s father).
4. Approver for the issue of the financial statements and date of approval
The financial statements were approved for issue by the Board of Directors of the Company on August 25, 2023.
5. Scope of the consolidation of financial statements
As of June 30, 2023, the Company has 26 subsidiaries which are included in the consolidated scope, as detailed in
“Note IX. Equities in Other Entities”. Compared with last year, two subsidiaries have been newly added into while
one subsidiary has been deleted from the consolidated scope during the reporting period. For details, see “Note
VIII. Changes in Consolidated Scope”.
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C&S Paper Co., Ltd. Semi-annual Report 2023
IV. Preparation Basis for Financial Statements
1. Basis of preparation
The financial statements of the Company have been prepared on a going concern basis based on actual transactions
and events and according to the Accounting Standards for Business Enterprises - Basic Standards promulgated by
the Ministry of Finance (MOF No. 33 Document and No. 76 Revision), the 41 accounting standards, Guidelines for
the Application of the Accounting Standards for Business Enterprises, interpretation to the accounting standards for
business enterprises and other relevant regulations that are successively promulgated on or after February 15, 2006
(hereinafter collectively referred to as “Accounting Standards for Business Enterprises”), and rules set out in No.
15 Preparation and Reporting Rules of Information Disclosure of Public Offering Companies - General Rules for
Financial Statements (2014 Revision) issued by China Securities Regulatory Commission based on actual
transactions and events.
In accordance with the relevant rules of Accounting Standards for Business Enterprises, the financial accounting of
the Company is based on accrual basis. Apart from some financial tools, the accounting measurement of the financial
statements is based on historical cost method. Provision for impairment of asset is set aside if it is recognized.
2. Going concern
The Company shall be a going concern for at least 12 months following the end of the reporting period. There are
no major events that will affect the Company’s operational ability; therefore, the assumption on which the financial
statements are based is reasonable.
V. Significant Accounting Policies and Accounting Estimates
Specific accounting policies and accounting estimates:
C&S Paper Co., Ltd. and all its subsidiaries have set out several specific accounting policies and accounting
estimates for transactions and events with relation to the recognition of incomes and income taxes in accordance
with the Accounting Standards for Business Enterprises and their own operational characteristics. Please refer to
“Note V (39) Revenue” for details. As for explanations of significant accounting judgments and estimates made by
the management, please refer to “Note V (44) Significant changes of accounting policies and accounting estimates”.
1. Statement of compliance with the accounting standards for business enterprises
The financial statements of the Company conform to the requirements set out in the Accounting Standards for
Business Enterprises. The statements truthfully and completely reflect the financial status, operating results, cash
flow, and other relevant information of the Company. In addition, the financial statements of the Company are also
in accordance with disclosure requirements for financial statements and notes in No. 15 Preparation and Reporting
Rules of Information Disclosure of Public Offering Companies - General Rules for Financial Statements of the
China Securities Regulatory Commission (2014 Revision) in all material aspects.
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C&S Paper Co., Ltd. Semi-annual Report 2023
2. Accounting period
The accounting period of the Company is divided into annual and interim periods. The interim period refers to the
reporting period shorter than a complete accounting year.The accounting year of the Company is from January 1 to
December 31 of each calendar year.
3. Operating cycle
The operating cycle of the Company normally refers to the periods during which the Company purchases assets for
processing and then gets cash or cash equivalents from the processed items. The Company sets 12 months as a full
operating cycle and uses the 12-month period as a standard for the liquidity of assets and liabilities.
4. Standard currency for accounting
RMB is the main currency in the main economic environments in which the Company and its domestic subsidiaries
operate. Therefore, the Company and its subsidiaries use RMB as the standard currency for bookkeeping. The
currency for accounting used in the Company’s financial statements is RMB.
5. Accounting treatment measures of business combinations involving enterprises under common control and
business combinations involving enterprises not under common control
Business combinations refer to the combination of two or more independent enterprises to form a reporting entity
of transactions or events. Business combination can be classified as business combinations involving enterprises
under common control and business combinations involving enterprises not under common control.
(1) Business combinations involving enterprises under common control
Business combinations under common control means enterprises involved in the business combination are under
ultimate control by one party or the same multi-parties before and after combination, and such control is not
temporary. For business combinations under common control, those who obtain control of enterprises involved in
the business combination on the combination date are the acquirer while other enterprises involved in the business
combination are the acquiree. Combination date is the date that the combining party actually obtains control of the
combined party.
Assets and liabilities that the acquirer gets from the acquiree are calculated and measured at the book values on the
combination date. If there are differences between the book values of the net assets the acquirer receives and the
book values of the combination consideration it pays (or the face values of the issued shares), the differences will
be used to adjust capital reserves (share premium). Where capital reserves (share premium) are insufficient to offset,
retained earnings shall be adjusted.
All direct expenses related to the business combinations paid by the acquirer shall be included in current profits and
losses upon occurrence.
(2) Business combinations involving enterprises not under common control
Business combinations not under common control means enterprises involved in the business combination are not
under ultimate control by one party or the same multi-parties before and after combination. For business
combinations not under common control, those who obtain control of enterprises involved in the business
combination on the acquisition date are the acquirer, while other enterprises involved in the business combination
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C&S Paper Co., Ltd. Semi-annual Report 2023
are the acquiree. Acquisition date is the date that the acquirer actually obtains control of the acquiree.
For business combinations not under common control, the costs of combination include the assets the acquirer pays,
liabilities the acquirer bears, and the fair value of the equity securities issued on the date of combination for the
acquisition of control over the acquiree. The costs of auditing, legal services, evaluation consulting, other
intermediary expenses and other management fees incurred for business combination shall be included in current
profits and losses. The transaction costs of the equity securities and debt securities issued by the acquirer shall be
included in the initially confirmed amounts of equity securities and debt securities. The contingent consideration
involved shall be included in the costs of business combination based on its fair value at the acquisition date. If,
within 12 months after the acquisition, there is new or further evidence for conditions that have already existed on
the acquisition date and the contingent consideration shall be re-adjusted, the combination goodwill shall be adjusted
accordingly. The acquirer’s costs of business combinations and its identifiable net assets obtained from business
combinations shall be assessed at the fair values on the acquisition date. If the costs of business combinations are
higher than the identifiable net assets of the acquiree on the acquisition date, the gap between them shall be
confirmed as goodwill. If the costs of business combinations are lower than the fair values of the identifiable net
assets of the acquiree on the acquisition date, the fair values of identifiable assets, liabilities and continent liabilities
as well as the measurement of combination costs shall be reassessed; if, upon reassessment, the business
combination costs are still lower than the fair values of the identifiable net assets of the acquiree, the difference
shall be included in profits and losses of the current period.
If the deductible temporary differences the acquirer gets from the acquiree are not eligible to be confirmed as
deferred tax asset on the acquisition date, and within 12 months of the acquisition, there are new or further evidence
for the conditions that have already existed on the acquisition date that the economic profits brought by the
deductible temporary differences of the acquiree could be achieved, such differences shall be confirmed as deferred
tax asset. At the same time, the goodwill shall be reduced. Where the goodwill is insufficient to be deducted, the
gap between them shall be included in current profits and losses. Apart from the aforementioned situations, all
deductible temporary differences confirmed to be relevant to the business combination shall be recorded in current
profits and losses.
For business combinations not under common control that are achieved through multiple steps, whether they can be
regarded as package deals shall be judged in accordance with Notice No.5 of the Interpretation of Accounting
Standards for Business Enterprises of the Ministry of Finance (C.K. [2012] No.19), and the standards of “package
deals” set out in Article 51 of the Accounting Standard for Business Enterprises No. 33 – Consolidated Financial
Statements (please refer to Note V (6) “methods for preparation of consolidated financial statements” (2)). In the
event that the combination is regarded as “package deals”, accounting treatment shall be done by referring to the
descriptions in previous paragraphs of this section and “Note V (22) Long-term equity investments” herein; if not,
accounting treatment shall be done by distinguishing individual financial statements from consolidated financial
statements:
In individual financial statements, the initial investment costs shall be the sum of the book value of the equity
investment of the acquiree held before the acquisition date and the new investment costs on the acquisition date; if
other comprehensive income is involved in the equities of the acquiree before the acquisition date, accounting
processing shall be done for the comprehensive income related to this investment by adopting the same basis for
directly disposing of relevant assets or liabilities of the acquiree during the disposal of this investment (that is,
except for the corresponding shares of the changes caused by re-measurement of the net liabilities or net assets of
the defined benefit plan by the acquiree, which are accounted by the equity method, others shall be transferred to
the return on investment of the current period).
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C&S Paper Co., Ltd. Semi-annual Report 2023
In consolidated financial statements, the equities of the acquiree held before the acquisition date shall be re-
measured at the fair value of the equities on the acquisition date, and the difference between the fair value and the
book value shall be recognized as the return on investment of the current period; if other comprehensive income is
involved in the equities of the acquiree before the acquisition date, accounting processing shall be done for the
comprehensive income related to this investment by adopting the same basis for directly disposing of relevant assets
or liabilities of the acquiree .
6. Methods for preparation of consolidated financial statements
(1) Principles of determining the scope of consolidated financial statements
The scope of consolidation of consolidated financial statements shall be subject to the basis of control. Control
refers to the power the investor owns against the investee, which allows the investor to enjoy the variable return by
attending relevant activities held by the investee, and to be capable of using such power to affect the amount of
return. The scope of consolidation is the Company and all of its subsidiaries. Subsidiaries refer to entities controlled
by the Company.
The Company shall reassess whether it controls an investee if facts and circumstances indicate that there are changes
to the relevant elements of control as defined above.
(2) Methods for preparation of consolidated financial statements
The Company shall include the subsidiaries in the scope of consolidation from the date it acquires the actual control
over the net assets and the decision-making of production and operations of such subsidiaries; accordingly, the
Company shall terminate including them in the scope of consolidation from the date it loses the actual control. In
terms of subsidiaries already disposed of, the operating results and cash flows before the disposal date have been
included in the consolidated income statements and the consolidated cash flow statements appropriately; as for
subsidiaries disposed in the current period, the opening balance in the consolidated balance sheet shall not be
adjusted. In case of subsidiaries added through business combinations not under the same control, the operating
results and cash flows after the acquisition date have been included in the consolidated income statements and the
consolidated cash flow statements appropriately, and the opening and comparative balance in the consolidated
balance sheet shall not be adjusted. In case of subsidiaries added through business combinations under the same
control, the operating results and cash flows of the combined party from the beginning of the period in which the
combination happens to the combination date have been included in the consolidated income statements and the
consolidated cash flow statements appropriately, and the comparative balance in the consolidated balance sheet shall
be adjusted simultaneously.
In case of inconsistencies in the accounting policies or periods between subsidiaries and the Company during
preparation of consolidated financial statements, financial statements of subsidiaries shall be adjusted according to
the accounting policies and periods adopted by the Company. For subsidiaries acquired by business combinations
not under the same control, their financial statements shall be adjusted based on the fair value of the identifiable net
assets on the acquisition date.
All major business transaction balance, transactions, and unrealized profit of the Company shall be offset during
preparation of consolidated financial statements.
Shareholders’ equities of subsidiaries and the part of the net profit and loss of the current period not attributable to
the Company shall be presented separately under the shareholders’ equities and the net profit in the consolidated
financial statements as equities of minority shareholders and minority shareholders’ profits and losses. Shares of
equities of minority shareholders in the net profit and loss of the current period of subsidiaries shall be presented
88
C&S Paper Co., Ltd. Semi-annual Report 2023
under the “minority shareholders’ profits and losses” in the consolidated income statement. If the loss of a subsidiary
which is shared by its minority shareholders exceeds the minority shareholders’ share in the opening balance of the
subsidiary, the minority interest shall be reduced.
If the Parent Company loses control of a subsidiary due to partial disposal of equity investment or other reasons, it
shall re-measure the remaining equity at fair value on the date of loss of control. The sum of consideration obtained
from equity disposal and fair value of the remaining equity, minus the difference between the Parent Company’s
share of the subsidiary’s net assets that is continuously calculated from the acquisition date, shall be recognized as
investment income for the reporting period when the loss of control takes place. Accounting processing shall be
done for the other comprehensive income related to this investment in the subsidiary’s equities by adopting the same
basis for directly disposing of relevant assets or liabilities of the acquiree during the loss of control (that is, except
for the changes caused by re-measurement of the net liabilities or net assets of the defined benefit plan by the
previous subsidiary, others shall be transferred to the return on investment of the current period). After that,
subsequent measurement shall be done for the remaining equity of this part as per relevant provisions in the
Accounting Standards for Business Enterprises No. 2 - Long-term Equity Investment or the Accounting Standards
for Business Enterprises No. 22 - Recognition and Measurement of Financial Instruments. See “Note V (22) Long-
term equity investments” or “Note V (10) Financial instruments” for details.
If the Company disposes of investments in a subsidiary’s equities by steps via transactions until it loses control, it
shall check whether these transactions from disposal of the investments in the subsidiary’s equities to the loss of
control are package deals. If the terms, conditions, and economic effects of transactions on disposing of equity
investment in the subsidiary conform to one or more of the following circumstances, that means these multiple
transactions should be treated as package deals in accounting processing: 1) Those transactions are reached at the
same time or after taking into consideration the influence of each other; 2) those transactions together produce a
complete commercial outcome; 3) the occurrence of one transaction depends on the occurrence of at least one other
transaction; 4) one transaction alone does not seem to be economical, but all those transactions are economical when
are considered as a whole. If those transactions are package deals, each transaction shall be treated as a transaction
that results in loss of control of the subsidiary in accounting processing. However, the difference between each
disposal price before loss of control and the Parent Company’s share of the subsidiary’s net assets corresponding to
the disposal investment shall be recognized as other comprehensive income in the consolidated financial statements
and, upon loss of control, transferred to the profit and loss of the current reporting period.
7. Classification of joint operation arrangements and accounting treatment methods for joint operations
None.
8. Criteria for recognition of cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits that can be used for payment at any time, and short-term
(due within three months from the acquisition date) investment held by the Company with high liquidity, easy to
convert to cash in a known amount, and small risk of value changes.
9. Translation of transactions and financial statements denominated in foreign currencies
(1) Methods for translation of transactions denominated in foreign currencies
At the initial recognition of foreign currency transactions of the Company, foreign currency will be translated into the
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C&S Paper Co., Ltd. Semi-annual Report 2023
amount of standard currency for accounting at the spot exchange rate or its approximate exchange rate on the transaction
date. However, the business of exchange of foreign currencies or transactions related to the exchange of foreign currencies,
foreign currency will be translated into the amount of standard currency for accounting at the exchange rate actually
adopted.
(2) Methods for translation of monetary and non-monetary items in foreign currencies
On the balance sheet date, the foreign currency monetary items are translated at the spot exchange rate on that date.
Exchange difference resulting from the difference between the spot exchange rate on the balance sheet date and that
at the initial recognition or on the previous balance sheet date shall be recognized as the profit and loss of the current
period.
Non-monetary items that are measured at historical cost in foreign currencies shall still be converted at the spot
exchange rate on the transaction date with the amount of standard currency for accounting unchanged. Non-
monetary items that are measured at fair value in foreign currencies are translated using the foreign exchange rate
at the date the fair value is recognized. The difference between the amount of standard currency for accounting after
translation and the original amount of the standard currency for accounting shall be treated as a change in fair value
(including the change in the exchange rate) and recognized as the profit and loss of the current period or other
comprehensive income.
(3) Methods for translation of foreign-currency financial statements
Foreign-currency financial statements of overseas operations shall be translated into RMB financial statements by the
following methods: The assets and liabilities in the balance sheet shall be converted at the spot exchange rate on the
balance sheet date; except “undistributed profits”, all the other owner’s equity items are converted at the spot exchange
rate at the time of occurrence. Income and expense items in the income statement shall be translated using the foreign
exchange rates ruling at the dates of the transactions. The undistributed profit at the beginning of the year is the
undistributed profit at the end of the year after the conversion of the previous year; The undistributed profits at the end of
the period are calculated and listed according to the profit distribution items after conversion; The difference between the
total amount of assets, liabilities and shareholders' equity after translation is recognized as other comprehensive income
as the translation difference of foreign currency statements.Translation of comparative financial statements shall be
subject to the above provisions.
10. Financial instruments
When the Company becomes a party to a financial instrument contract, the financial instrument is confirmed to be
either financial assets or financial liabilities.
(1) Classification, recognition, and measurement of financial assets
According to the business model of managing financial assets and the contractual cash flow characteristics of
financial assets, the Company classified financial assets into the following categories: financial assets measured at
the amortized cost, financial assets measured at fair value through other comprehensive income and financial assets
measured at fair value through profit and loss of the current period.
Financial assets are measured at fair value upon initial recognition. For financial assets measured at fair value
through profit and loss of the current period, transaction costs are directly included in profit and loss of the current
period. For other types of financial assets, related transaction costs are included in their initial recognized amounts.
In terms of the accounts receivable or notes receivable arising from selling products or providing labor service
without or not considering major financing component, the Company shall regard the expected consideration
amount that it has rights to charge as the initial recognition amount.
1) Financial assets measured at amortized cost
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C&S Paper Co., Ltd. Semi-annual Report 2023
For the business model where the Company manages the financial assets carried at amortized cost, the Company
aims to charge the contract cash flows, and the characteristics of the contract cash flows of this kind of financial
assets are consistent with the basic lending arrangements. That is, cash flows generated on specified dates are solely
payments of principal and interest on the principal amount outstanding. This kind of financial assets are
subsequently measured at amortized cost using the effective interest method. Gain or loss arising from amortization
or impairment is recognized in profit and loss of the current period.
2) Financial assets measured at fair value through other comprehensive income
The business model for the Company to manage this type of financial assets aims at both obtaining the contract cash
flows and selling the financial assets, and the characteristics of the contract cash flows of this kind of financial assets
are consistent with the basic lending arrangements. The Company measures this kind of financial assets at fair value
through other comprehensive income, but recognizes the impairment losses or gains, exchange profit and loss, and
interest income calculated by the effective interest method as the profit and loss of the current period.
Additionally, the Company designates some non-tradable equity instruments as financial assets at fair value through
other comprehensive income. The Company recognizes relevant dividend income from such financial assets as the
profit and loss of the current period, and changes in fair value as other comprehensive income. When such financial
assets are derecognized, the accumulated gains or losses previously recognized as other comprehensive income shall
be transferred from other comprehensive income to retained earnings and not recognized as the profit and loss of
the current period.
3) Financial assets measured at fair value through profit and loss of the current period
All financial assets other than the other two preceding types are classified as financial assets measured at fair value
through profit and loss of the current period. Moreover, at initial recognition, to eliminate or significantly reduce
accounting mismatches, the Company may designate some financial assets as financial assets measured at fair value
through profit and loss of the current period. Such financial assets shall be measured at fair value, and changes in
fair value are recognized as the profit and loss of the current period.
(2) Classification, recognition, and measurement of financial liabilities
At initial recognition, financial liabilities are classified into financial liabilities measured at fair value through profit
or loss and other financial liabilities. For financial liabilities at fair value through profit and loss of the current period,
transaction costs are directly included in profit and loss of the current period. For other types of financial liabilities,
related transaction costs are included in their initial recognized amounts.
1) Financial liabilities measured at fair value through profit and loss of the current period
Financial liabilities measured at fair value through profit and loss of the current period include tradable financial
liabilities (including derivatives belonging to financial liabilities) and financial liabilities designated to be measured
at fair value through profit and loss of the current period at initial recognition.
Tradable financial liabilities (including derivatives that are financial liabilities) are subsequently measured at fair
value, and changes in fair value -- except for those related to hedging accounting -- are recognized as profit and loss
of the current period.
For those that are designated as financial liabilities measured at fair value through profit or loss, the changes in fair
value resulting from changes in the credit risk of the Company shall be recognized as other comprehensive income;
besides, when such liabilities are derecognized, the amount of accumulative changes in fair value resulting from
credit risk changes that are recognized as other comprehensive income shall be transferred to retained earnings.
Other changes in fair value shall be recognized as the profit and loss of the current period. If the treatment of the
credit risk changes in such financial liabilities by the above methods will result in expansion of the accounting
mismatch in the profit and loss, the Company shall recognize all gains or losses in such financial liabilities
(including the amount subject to the credit risk changes of the Company) as the profit and loss of the current period.
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2) Other financial liabilities
Except for financial liabilities resulting from financial asset transfers not meeting the conditions for derecognition
or the continuous involvement in the transferred financial asset, or financial guarantee contracts, other financial
liabilities shall be classified into the financial liabilities measured at amortized cost, which shall be subsequently
measured at amortized cost, and the gains or losses resulting from derecognition or amortization shall be recognized
as the profit and loss of the current period.
(3) Recognition basis and measurement method of financial asset transfer
Once one of the following conditions is met, the financial assets shall be derecognized: 1) The contract right to
charge the cash flows of the financial assets is terminated; 2) the financial assets have been transferred, and almost
all the risks and rewards of the ownership of the financial assets are transferred to the transferee; 3) the financial
assets have been transferred, and the Company has given up the control over the financial assets although it does
not transfer or retain almost all the risks and rewards of the ownership of the financial assets.
If the Company has neither transferred nor retained almost all the risks and rewards of the ownership of the financial
assets, and the Company does not waive its control of the financial assets, it shall recognize the relevant financial
assets within the extent of its continuous involvement in the transferred financial assets and recognize the relevant
liabilities. The continuous involvement in the transferred financial assets refers to the level of risk with which the
Company is faced due to changes in the financial asset values.
When overall transfer of financial assets meets the conditions for derecognization, the book value of the transferred
financial assets and the difference between the consideration received due to transfer and the accumulative changes
in fair value that is originally recognized as other comprehensive income shall be recognized as the profit and loss
of the current period.
When partial transfer of financial assets meets the conditions for derecognization, the book value of the transferred
financial assets shall be apportioned to the fair value between the derecognized part and the recognized part, and
the consideration received due to transfer and the difference between the accumulative changes in fair value that is
originally recognized as other comprehensive income, which shall be apportioned to the derecognized part, and the
apportioned book value as mentioned above shall be recognized as the profit and loss of the current period.
When the Company sells financial assets with additional recourse or transfers the endorsed financial assets held, it
shall check whether almost all the risks and rewards of the ownership of the financial assets are transferred. If the
Company has transferred almost all the risks and rewards of the ownership of the financial assets to the transferee,
it shall derecognize the financial assets; if the Company retains almost all the risks and rewards of the ownership of
the financial assets, it shall not derecognize the financial assets; if the Company neither transfers nor retains almost
all the risks and rewards of the ownership of the financial assets, it shall judge whether it has retained control over
the assets and conduct accounting processing following the principles described in previous paragraphs.
(4) Derecognition of financial liabilities
If current obligations of the financial liabilities (or some of the liabilities) have been released, the Company shall
derecognize the financial liabilities (or some of the liabilities). Where the Company (borrower) and a lender sign an
agreement to replace the existing financial liability by way of assumption of new financial liability with the terms
of the new financial liability substantially different from those of the existing financial liability, it derecognizes the
existing financial liability while recognizing the new financial liability. If the contract terms of the existing financial
liability are materially changed in whole (or in part), the existing financial liability will be derecognized, and the
financial liability after changes of terms will be recognized as a new financial liability.
If a financial liability is derecognized in whole (or in part), the difference between the book value of the
derecognized portion and the consideration paid (including the non-cash assets transferred out or the new financial
liability assumed) is recognized as the profit and loss of the current period.
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(5) Offsetting financial assets and financial liabilities
When the Company has the statutory right to offset the recognized amount of financial assets and financial liabilities,
and this statutory right is currently enforceable, and the Company plans to net the financial assets or simultaneously
realize the financial assets and pay off the financial liabilities, the financial assets and financial liabilities are
presented in the balance sheet at the net amount after offsetting each other. Otherwise, financial assets and financial
liabilities are presented separately in the balance sheet and are not offset against each other.
(6) Methods for determining the fair value of financial assets and financial liabilities
The 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. If there are active markets for a financial instrument, the
Company establishes its fair value by using quotes in the active markets. Quotes in active markets refer to prices
that are readily available on a regular basis from exchanges, brokers, trade associations, pricing service institutions,
etc., and represent the prices of market transactions that actually occur in a fair trade. If there is no active market,
the Company establishes fair value by using valuation techniques.
Valuation techniques include reference to price used in recent market transactions between knowledgeable, willing
parties, reference to the current fair value of other financial instruments that are substantially the same, discounted
cash flow analysis, option pricing models, etc. During valuation, the Company adopts the valuation techniques that
are applicable under current circumstances and supported by sufficient available data and other information, selects
the input values that are consistent with the characteristics of the assets or liabilities considered by the market
participants in the transaction of the relevant assets or liabilities, and preferentially uses the relevant observable
inputs. Unobservable input values are used where the relevant observable input values are not available or are not
practicable.
(7) Equity instruments
An equity instrument refers to a contract that can prove the Company owns the remaining equity in the assets after
deducting all liabilities. The Company’s issuance (including refinancing), repurchase, sales or cancellation of equity
instruments are treated as changes in equities, and transaction costs related to equity transactions are deducted from
equities. The Company does not recognize changes in the fair value of equity instruments.
The distribution of dividends by equity instruments (including “interests” generated by instruments that are
classified as equity instruments) during their period existence shall be treated as profit distribution.
(8) Impairment of financial assets
The financial assets for which the Company needs to recognize impairment losses are financial assets measured at
amortized cost, debt instrument investments measured at fair value through other comprehensive income, and lease
receivables, mainly including notes receivable, accounts receivable, and other receivables. In addition, for some
contract assets and financial guarantee contracts, impairment reserves are set aside and credit impairment losses are
recognized as per the accounting policies described in this section.
1) Methods for recognizing impairment reserves
Based on the expected credit loss, the Company sets aside provisions for impairment of the above items by methods
(general method or simplified method) for measuring expected credit loss applicable to them and recognizes credit
impairment loss.
Credit loss refers to the difference between all contract cash flow receivables discounted at the original effective
interest rate under the contract and all expected cash flow receivables, i.e., the present value of all cash shortages.
Specifically, for financial assets that have been credit-impaired at the time of purchase or origin, the Company
discounts the financial assets at the credit-adjusted actual interest rate.
The general method for measuring expected credit loss means that the Company assesses on each balance sheet date
whether the credit risk of financial assets has increased significantly since the initial recognition. If yes, the
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Company measures loss reserves at an amount equivalent to the expected credit loss in the entire duration; if not,
the Company measures loss reserves at an amount equivalent to the expected credit loss in the next 12 months. The
Company considers all reasonable and evidence-based information, including forward-looking information, when
assessing expected credit loss;
As for financial instruments with low credit risk on the balance sheet date, the Company measures the loss reserves
according to the expected credit loss in the future 12 months, assuming that its credit risk has had no significant
increase since its initial recognition. The Company chooses to measure loss reserves according to the expected credit
loss in the next 12 months or in the entire duration based on whether the credit risk has increased significantly since
initial recognition.
2) Standards for judging whether credit risk has increased significantly since initial recognition
If the probability of default (PD) of a financial asset in the expected duration recognized on the balance sheet date
is significantly higher than that in the expected duration recognized at the time of initial recognition, the credit risk
of the financial asset has increased significantly. Except for special circumstances, the Company determines whether
credit risk has increased significantly since initial recognition by reasonably assessing the changes in the PD in the
entire duration with the changes in the coming 12 months.
3) Portfolio method for assessing expected credit risk based on portfolios
The Company assesses individual credit risk of financial assets with significantly different credit risks. Examples
include the following: receivables from related parties; receivables that have disputes with counterparties or those
involved in litigation or arbitration; there are obvious signs that the debtor is very unlikely to fulfill the repayment
obligation.
In addition to financial assets whose individual credit risk is assessed, the Company divides financial assets into
different groups based on common risk characteristics, and assesses credit risk on a portfolio basis.
4) Accounting treatment methods for impairment of financial assets
At the end of the reporting period, the Company calculates the expected credit loss of financial assets. If the expected
credit loss is greater than the book value of its current impairment provisions, the difference is recognized as an
impairment loss; if it is less than the current book value of the impairment provisions, the difference is recognized
as impairment gains.
5) Methods for recognizing credit losses of financial assets
a. Notes receivable
The Company measures loss reserves for notes receivable at an amount equivalent to expected credit loss in the
entire duration. The Company divides notes receivable into different portfolios based on their credit risk
characteristics:
Item Basis for determining the portfolio
Banker’s acceptance Acceptors are banks with low credit risks.
Trade acceptance The aging of trade acceptance is used as credit risk characteristics.
b. Accounts receivable
The Company measures loss reserves for accounts receivable without major financing component at an amount
equivalent to expected credit loss in the entire duration.
The Company measures loss reserves for accounts receivable and lease receivables with major financing component
at an amount equivalent to expected credit loss in the duration.
Except for accounts receivable whose individual credit risk is assessed, the Company divides accounts receivable
into different portfolios based on their credit risk characteristics:
Item Basis for determining the portfolio
Aging portfolio This portfolio uses aging of accounts receivable as credit risk characteristics.
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Related party portfolio This portfolio comprises amounts of related parties within the consolidated scope.
c. Other receivables
The Company adopts the amount equivalent to the expected credit loss in the coming 12 months or in the entire
duration to measure impairment losses based on whether the credit risk of other receivables has increased
significantly since initial recognition. Except for other receivables whose individual credit risk is assessed, the
Company divides other receivables into different portfolios based on their credit risk characteristics:
Item Basis for determining the portfolio
Aging portfolio This portfolio uses aging of other receivables as credit risk characteristics.
Related party portfolio This portfolio comprises amounts of related parties within the consolidated scope.
11. Notes receivable
For details, please refer to 10. Financial instruments in V. Significant Accounting Policies and Accounting Estimates
of Section X.
12. Accounts receivable
For details, please refer to 10. Financial instruments in V. Significant Accounting Policies and Accounting Estimates
of Section X.
13. Accounts receivable financing: None
14. Other receivables
Recognition methods and accounting treatment methods for expected credit loss in other receivables
For details, please refer to 10. Financial instruments in V. Significant Accounting Policies and Accounting Estimates
of Section X.
15. Inventories
(1) Classification of inventories
Inventories mainly include raw materials, goods in process, materials for consigned processing, commodity stocks,
packages, and low-value consumables.
(2) Pricing methods for inventory acquisition and delivery
Inventories are priced at actual cost when they are acquired. Inventory costs include procurement costs, processing
cost, and other costs. Inventories are priced by the weighted average method during receipt and delivery.
(3) Methods for recognition of the net realizable value of inventories and the provisions for impairment of
inventories
The net realizable value refers to the amount of the estimated selling price of the inventory minus the estimated cost,
estimated selling expenses, and related taxes and fees at the time of completion in daily activities. When recognizing
the net realizable value of inventories based on the substantial evidence obtained, the Company also considers the
purpose of holding the inventories and the impact on matters after the balance sheet date.
On the balance sheet date, inventories are measured at the lower of costs and the net realizable value. When the net
realizable value is lower than costs, the Company sets aside provisions for inventory impairment. Provisions for
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inventory impairment are set aside based on the difference between the cost of individual inventory item and its net
realizable value. For inventories with a large quantity but a low unit value, provisions for inventory impairment are
set aside according to inventory category.
After provisions for the inventory impairment are set aside, if the influencing factors in previous write-down of the
inventory value disappear, causing the net realizable value of the inventory to be higher than its book value, it shall
be reversed within the amount of the provisions for inventory impairment that have been set aside and recognized
as the profit and loss of the current period.
(4) The perpetual inventory system is adopted for the inventories.
(5) Amortization method for low-value consumables and packages
The one-time amortization method is adopted for low-value consumables and packages upon receipt.
16. Contract assets
The Company recognizes the contract amounts where the customer has not paid the consideration but the Company
has fulfilled its contractual obligation while the claim to the amount from the customer is not unconditional (i.e.
Only dependent on the passage of time) as contract assets in the balance sheet. Contract assets and contract liabilities
under the same contract are presented on a net basis; contract assets and contract liabilities under different contracts
are not offset.
17. Contract costs
If the incremental cost incurred by the Company for obtaining a contract is expected to be recovered, the cost of
obtaining the contract is recognized as an asset. However, if the amortization period of the asset does not exceed
one year, it is included into the profit and loss of the period as it occurs.
If the contract cost does not fall within other enterprise accounting standards than the Accounting Standards for
Business Enterprises No. 14 -- Revenue and meet the following conditions at the same time, it is considered as
contract performance cost and recognized as asset: 1) the cost is directly related to an existing or expected contract
including direct labor, direct material or manufacturing overhead (or similar expenses), or the cost has been
expressly defined as borne by the customer, or the cost is incurred solely as a result of the contract; 2) the cost
increases the Company’s future resources to perform contractual obligations; and 3) the cost is expected to be
recovered.
Contract cost-related assets are amortized on the same basis of goods revenue recognition relating to the asset and
included in the profit and loss of the current period.
18. Assets held for sale
The Company classifies non-current assets or a disposal group as held for sale (including exchange of non-monetary
assets with commercial substance, the same below) if their book values are recovered principally through disposal
rather than through continuing use. Specifically, the following conditions shall be met simultaneously: A certain
non-current asset or disposal group can be sold immediately under the current conditions according to the practice
of selling such assets or disposal groups in similar transactions; the Company has made a resolution of an offer and
obtained the purchase commitment; the sale is expected to be completed within one year. Among them, the disposal
group refers to a group of assets that are disposed of as a whole through sale or other means in a transaction, and
the liabilities directly related to these assets that are transferred in the transaction. If the asset group or the
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combination of asset groups to which the goodwill (obtained from business combination) has been allocated in
accordance with the Accounting Standards for Business Enterprises No. 8 -- Impairment of Assets, the disposal
group shall include the goodwill allocated to it.
During initial measurement or re-measurement of the non-current assets and disposal groups classified into held-
for-sale assets on the balance sheet date, if the book value of such assets is higher than the net value deducting the
cost of offer, the book value is written down to the recoverable amount by the Company, the written-down amount
is recognized as profit and loss of the current period and impairment provisions are set aside at the same time. For
the disposal group, the recognized asset impairment loss is first deducted from the book value of the goodwill in the
disposal group, and then deducted in proportion from the book value of non-current assets specified in the applicable
Accounting Standards for Business Enterprises No. 42 - Non-Current Assets and Disposal Groups Held for Sale
and Discontinued Operations (hereinafter referred to as the “Standards for Assets Held for Sale”). If the fair value
of the disposal group held for sale on the subsequent balance sheet date increases after deducting the selling expenses,
the previously written down amount shall be restored, and reversed within the amount of the asset impairment losses
recognized for non-current assets as per the Standards for Assets Held for Sale applicable after the assets are
classified into those held for sale, and the reversed amount shall be recognized as the profit and loss of the current
period. Besides, the book value of the reversed amount shall be increased in proportion according to the proportion
of the book value of the non-current assets specified in the Standards for Assets Held for Sale applicable to those
except for the goodwill in the disposal group. The book value of the goodwill that has been deducted, and the asset
impairment losses recognized before the non-current assets are classified into assets held for sale as per the
Standards for Assets Held for Sale shall not be reversed.
Non-current assets held for sale and non-current assets in the disposal group are not subject to depreciation or
amortization. Interest and other expenses on liabilities in the disposal group held for sale continue to be recognized.
When the non-current assets or disposal group no longer meets the conditions for classification into the assets held
for sale, the Company no longer classifies them into the category or removes the non-current assets from the disposal
group held for sale, and measures them at the lower of the following two: (1) in terms of the book value before
classification into assets held for sale, for which the measurement standard is the amount after adjustment according
to the depreciation, amortization, or impairment that should have been recognized under the assumption that they
are not classified into assets held for sale; and (2) the recoverable amount.
19. Investments in creditor’s rights: None
20. Other investments in creditor’s rights: None
21. Long-term receivables: None
22. Long-term equity investments
The long-term equity investments herein refer to the long-term equity investments in which the Company has control,
joint control, or significant influence on the investee. Long-term equity investments where the Company has no
control, joint control, or significant influence on the investee are accounted as financial assets measured at fair value
through profit and loss of the current period. Among them, for those that are non-tradable, the Company may choose
to designate them as the financial assets measured at fair value through other comprehensive income for accounting
during initial recognition. See “Note V (10) Financial instruments” for their detailed accounting policies.
Joint control refers to the common control over a particular arrangement according to relevant agreement, and that
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the decisions on relevant activities under such arrangement are subject to the unanimous consent from the parties
sharing the joint control. Significant influence means having the power to participate in the financial and operating
policy decision-making of the investee, but cannot control or, together with other parties, jointly control the
formulation of these policies.
(1) Determination of investment cost
For long-term equity investments obtained from combination of enterprises under common control, the share of the
combined party’s owner’s equity in the book value of the consolidated financial statements of the final controlling
party which is acquired on the combination date shall be regarded as the initial investment cost for long-term equity
investments. The capital reserves shall be adjusted if there is difference between the initial investment cost of long-
term equity investment and the cash paid, the transferred non-cash assets, and the book value of the debts assumed;
if the capital reserve is insufficient to offset, the retained earnings shall be adjusted. If the equity securities issued
are used as the combination consideration, the share of the combined party’s owner’s equity in the book value of
the consolidated financial statements of the final controlling party which is acquired on the combination date shall
be regarded as the initial investment cost for long-term equity investments; the total book value of the shares issued
shall be the share capital; the capital reserves shall be adjusted if there is difference between the initial investment
cost of long-term equity investments and the total book value of the shares issued; if the capital reserves are
insufficient to balance the difference, retained earnings shall be adjusted.
For long-term equity investments obtained from combination of enterprises under different control, the combination
costs on the acquisition date shall be used as the initial investment costs of the long-term equity investment; the
combination costs include the sum of the assets paid by the acquirer, the liabilities incurred or assumed, and the fair
value of the equity securities issued.
Intermediary expenses such as auditing, legal services, assessment and consulting and other related management
expenses incurred by the combining party or acquirer for the business combination shall be recognized as the profit
and loss of the current period.
Other equity investments except for long-term equity investments formed via business combination are initially
measured at cost. Subject to the way the long-term equity investments are obtained, the costs shall be recognized
based on the cash actually paid by the Company for acquisition, the fair value of the equity securities issued by the
Company, the value agreed in the investment contract or agreement, the fair value or original book value of the
assets swapped out in a non-monetary asset exchange transaction, and the fair value of the long-term equity
investment itself. Expenses, taxes, and other necessary expenditures directly related to acquisition of long-term
equity investments are also recognized as investment costs.
(2) Subsequent measurement and recognition of profit and loss
If the Company has common control or significant influence over the investee (except for constituting co-
proprietors), the long-term equity investment shall be accounted for by using the equity method. Additionally, the
Company’s financial statements apply the cost method for long-term equity investments that can make control in
the investee
1) Long-term equity investments accounted for using the cost method
When the cost method is used, the long-term equity investments are calculated according to the initial investment
cost. In the event that the investment is added or recovered, the cost of the long-term equity investments shall be
adjusted. With the exception of the price actually paid at the acquisition of investment or cash dividends or profits
included in consideration, declared but not issued yet, the return on investment of the current period shall be
recognized according to the cash dividends or profits declared to be issued by the investee.
2) Long-term equity investments accounted for using the equity method
When using equity method, if the initial investment cost of long-term equity investments is greater than the fair
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value share of the identifiable net assets entitled of the investee at the time of investment, the initial investment of
the long-term equity investments shall not be adjusted. If the initial investment cost of long-term equity investments
is lower than the fair value share of the identifiable net assets entitled of the investee at the time of investment, the
difference shall be recognized as profit and loss of the current period and the cost of the long-term equity investments
shall be adjusted at the same time.
When the equity method is used, return on investment and other comprehensive income shall be respectively
determined based on the share of net profit or loss and other comprehensive income realized by the investee that
shall be attributable or assumed, and the book value of long-term equity investments shall be adjusted at the same
time. Attributable share shall be calculated based on the profit or cash dividends declared by the investee and the
book value of long-term equity investments shall be accordingly decreased. In respect to other changes of owner’s
equity of the investee in addition to net profit or loss, other comprehensive income and profit distribution, the book
value of long-term equity investments shall be adjusted and recognized as capital surplus. When confirming the
share of the investee’s net profit and loss, the Company shall confirm the investee’s net profit after adjustment based
on the fair value of the identifiable net assets of the investee at the acquisition of the investment. Where the
accounting policy and accounting period adopted by the investee differs from those of the Company, the investee’s
financial statements shall be adjusted according to the Company’s accounting policy and accounting period, and the
return on investment and other comprehensive income shall be recognized accordingly. Where the transactions are
between the Company and the associates and joint ventures, and the assets that are invested or sold do not constitute
business, unrealized internal transaction profits and losses incurred between the Company and the associates and
joint ventures shall be offset with the part attributable to the Company which is calculated on a due pro-rata basis,
and the return on investment shall be recognized on this basis. However, unrealized internal transaction losses
incurred between the Company and the investees shall not be offset if they fall under the impairment losses on assets
transferred.
When confirming the limit of net loss incurred by the investee, the limit is the extent that the book value of the long-
term equity investments and other long-term equity that substantially constitutes a net investment in the investment
target is written down to zero. Additionally, if the Company has obligations to assume additional losses of the
investee, provisions are recognized according to the expected obligation, and recognized as investment losses for
the period. Where the investee records net profit in the future, the Company resumes and recognizes the profit-
sharing amount after such amount makes up the unrecognized loss-sharing amount.
23. Investment property
Measurement model for investment property
Measurement by the cost method
Depreciation or amortization method
Investment properties are real estate held to generate rental income or earn capital gains or both. Investment
properties include land use rights leased out, land use rights held for transfer after appreciation, buildings leased
out, etc.
Investment property is initially measured at cost. Subsequent costs are included in the investment property’s cost
only when it is probable that future economic benefits associated with the item will flow to the Company and the
cost of the item can be measured reliably. Other subsequent costs are recognized as profit and loss of the current
period when incurred.
The Company adopts the cost model for subsequent measurement of investment property, and depreciates or
amortizes it according to policies consistent with those for buildings or land use rights.
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Impairment test method and impairment provision method for investment property are detailed in “Note V (31)
Long-term asset impairment”.
Investment properties are derecognized when they are disposed of or permanently withdrawn from use and it is
expected that no economic benefit can be generated from its disposal. The income from selling, transferring, writing
off or destroying investment property, less its book value and relevant taxes and fees, is recognized as profit and
loss of the current period.
24. Fixed assets
(1) Recognition conditions
Fixed assets are tangible assets with a useful life of more than one accounting year that are held for production or
supply of goods or labor services, for rental to third parties, or for use in the organizations. Fixed assets shall only
be recognized when relevant economic interest may flow into the Company and costs thereof can be reliably
measured. Fixed assets shall be initially measured at cost and by taking into account the impact of estimated disposal
expense.
(2) Depreciation method
Type Depreciation method Depreciation life Residual value rate Annual depreciation rate
3.00%, 3.17% to 9.00%,
Properties and buildings Straight-line depreciation 10 to 30 years 5%. 10%
9.50%
4.50%, 4.75% to 45.00%,
Equipment Straight-line depreciation 2 to 20 years 5%. 10%
47.50%
6.43%, 6.79% to 18.00%,
Motor vehicles Straight-line depreciation 5 to 14 years 5%. 10%
19.00%
11.25%, 11.88% to
Office equipment Straight-line depreciation 3 to 8 years 5%. 10%
30.00%, 31.67%
18.00%, 19.00% to
Production equipment Straight-line depreciation 2 to 5 years 5%. 10%
45.00%, 47.50%
Estimated residual value refers to the current amount where, supposed the service life of a fixed asset has expired
and it is in the expected status of such expiration, the Company obtains from the disposal of such asset after the
estimated disposal expense is deducted.
(3) Determination basis, pricing method and depreciation method of fixed assets acquired under finance
leases：Not applicable
25. Construction work in process
Construction work in progress is measured at actual project expenditure, comprising project expenditure incurred
during construction and other necessary cost incurred.
The Company’s Construction work in progress is transferred to fixed assets when the assets are ready for their
intended use. If the fixed assets under construction have reached the expected usable status but have not yet
completed the final account for completed project, they shall be recognized as fixed assets according to the
estimated value, and accrue depreciation. After the completion of the final account for completed project, the
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original estimated value is adjusted according to the actual cost, but the original accrued depreciation amount is
not adjusted.
Impairment test method and impairment provision method for Construction work in progress are detailed in “Note
V (31) Long-term asset impairment”.
26. Borrowing costs
Borrowing costs include interest on borrowings, amortizations of discounts or premiums, incidental expenses,
exchange difference resulting from foreign-currency borrowings, etc. The borrowing costs that can be directly
attributable to the acquisition, construction or production of an asset eligible for capitalization shall be capitalized
if the capital expenditures have been incurred, the borrowing costs have been incurred, or the necessary purchase,
construction or production activities to make the asset reach the expected available or marketable state have begun.
When the assets with the purchase, construction or production meeting the capitalization conditions reach the
expected available or marketable state, they cease to be capitalized. Any other borrowing costs are recognized as an
expense in the period when they are incurred.
The amount of interest that shall be capitalized is determined based on the interest expenses incurred in the period
when a specifically borrowed fund is obtained less any income earned on the unused borrowing fund as a deposit
in a bank or as a temporary investment. Where funds are borrowed for a general purpose, the amount of interest that
shall be capitalized is determined by multiplying the part of the accumulative asset disbursements in excess of the
weighted average asset disbursement for the specifically borrowed fund by the capitalization rate of the general
borrowing used. The capitalization rate is the weighted average interest rates applicable to the general-purpose
borrowings.
During the capitalization, all exchange differences arising from earmarked foreign-currency borrowings shall be
capitalized; exchange differences arising from general-purpose foreign-currency borrowings shall be recognized as
profit and loss of the current period.
Assets eligible for capitalization refer to assets such as fixed assets, investment real estates and inventories that can
reach the expected available or marketable status after a long period of purchase, construction or production
activities.
If the acquisition, construction or production of an asset eligible for capitalization is continuously suspended for
over three months for abnormal reasons, capitalization of the borrowing costs shall be suspended, until the
acquisition, construction or production of the asset is resumed.
27. Biological assets: None
28. Oil & gas assets: None
29. Right-of-use assets
Impairment test method and impairment provision method for right-of-use assets are detailed in "Note V (42)
Leases".
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30. Intangible assets
(1) Pricing method, service life, and impairment test
Intangible assets refer to identifiable non-monetary assets without physical substance owned or controlled by the
Company.
Intangible assets are initially measured at cost. Costs of intangible assets are included in intangible assets’ book
value, only when it is probable that future economic benefits associated with the item will flow to the Company and
the cost of the item can be measured reliably. Other costs of intangible assets are recognized as profit and loss of
the current period when incurred.
Land use rights acquired are generally accounted for as intangible assets. With respect to self-built buildings
including plants, the relevant land use right expenses and buildings’ construction costs are accounted for as
intangible assets and fixed assets, respectively. For purchased houses and buildings, the price paid is distributed
between the land use right and the building. If it is difficult to distribute, it shall all be included in fixed assets.
From the beginning of use of intangible assets with finite service life, the accumulated amount of the original value
less estimated net residual value and the provisions for asset impairment set aside shall be amortized evenly in stages
by straight-line method over their service life. Intangible assets with uncertain service lives are not amortized.
The Company reviews the service life and amortization method of intangible asset with finite service life at the end
of the reporting period, and a change therein (if any) shall be accounted for as a change in accounting estimates.
Additionally, the Company reviews the service life and amortization method of intangible asset with uncertain
service life. If there is evidence that the period when it brings economic benefits to the enterprise is foreseeable, its
service life shall be estimated and it is amortized according to the amortization policy for intangible assets with
finite service life.
Impairment test method and impairment provision method for intangible assets are detailed in “Note V (31)”.
(2) Accounting policy for expenditure on internal research and development
The Company classifies the expenditure on an internal research and development project into expenditure on the
research phase and expenditure on the development phase.
Expenditure on the research phase is recognized as profit and loss of the current period when incurred.
Expenditure on the development phase is recognized as intangible asset when all the following criteria are met,
while expenditure in the development phase that does not meet the following criteria is recognized as profit and loss
of the current period when incurred:
1) technically feasible to complete the intangible asset so that it will be available for use or sale;
2) the intention to complete the intangible asset and use or sell it;
3) how the intangible asset will generate probable future economic benefits. Among other things, the Company can
demonstrate 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;
5) the ability to measure reliably the expenditure attributable to the intangible asset during the development.
Where the expenditure on research and development incurred cannot be classified into the expenditure on research
phase or the expenditure on development phase, it shall be recognized as profit and loss of the current period when
incurred.
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31. Long-term asset impairment
The Company determines on the balance sheet date whether there is any indication that the non-current and non-
financial assets may have been impaired, including fixed assets, construction work in progress, intangible assets
with limited service life, and investment properties measured using the cost model, and long-term equity
investments in subsidiaries, joint ventures and associates. If there is any indication that the asset is likely to be
impaired, the Company will estimate the recoverable amount and carry out the impairment test. Impairment tests
shall be conducted each year for goodwill and intangible assets with uncertain service life and not yet in use, whether
or not there is any indication of impairment.
If an impairment test shows that the recoverable amount of an asset is lower than its book value, the difference is
recognized as a provision for impairment and recognized as the impairment loss. The recoverable amount is
determined based on the higher of the net amount of the fair value of the asset minus the disposal expenses and the
present value of the expected future cash flow of the asset. The fair value of asset is determined according to the
price of the sales agreement in fair trade. If there is no sales agreement but an active market for the asset, the fair
value is determined according to the price offered by the buyer for the asset. If there is neither sales agreement nor
active market for the asset, the fair value of the asset shall be estimated based on the best information available. The
disposal costs include legal fees, relevant taxes and fees, as well as handling fees related to the disposal of asset,
and the direct costs incurred to ensure the asset reaches the marketable state. The present value of the expected
future cash flow of an asset shall be determined by the discounted cash at an appropriate discount rate, on the basis
of the expected future cash flow generated during the continuous use or final disposal of an asset. Provisions for
asset impairment are calculated and recognized on an individual basis. If it is difficult to estimate the recoverable
amount of individual assets, the Company will determine the recoverable amount of the asset group on the basis of
the asset group to which the asset belongs. Asset group refers to the smallest asset portfolio which can independently
generate cash inflows.
When an impairment test is performed on the goodwill separately listed in the financial statement, book value of
such goodwill is apportioned to the asset group or combination of asset groups that can benefit from the synergy
effect of business combination. If the test result shows that the recoverable amount of the asset group or combination
of asset groups is lower than their book value, corresponding impairment losses on goodwill will be recognized.
The impairment loss shall first offset against the book value of goodwill that is apportioned to asset group or a
combination of asset groups, and then offset against the book value of assets excluding goodwill in the asset group
or the combination of asset groups on a pro-rata basis according to the proportion of their book value.
Once the aforementioned asset impairment loss is recognized, it will not be reversed in subsequent accounting
periods even if the value can be recovered.
32. Long-term unamortized expenses
Long-term unamortized expenses are expenses which have been incurred but shall be amortized over a period longer
than one year, including the reporting period and the future periods. Long-term unamortized expenses of the
Company mainly include office building decoration costs, sewage use rights and electricity use rights. Long-term
unamortized expenses shall be amortized based on the straight-line method over the expected benefit period.
33. Contract liabilities
A contract liability is the Company’s obligation to transfer goods to a customer for which the Company has received
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consideration from the customer. If the customer has paid contract consideration or the Company has obtained the
unconditional right of collection before the Company transfer goods to the customer, the amount received or the
receivable is recognized as contract liability at the earlier of the time when the customer actual pays the amount and
when the amount becomes due. Contract assets and contract liabilities under the same contract are presented on a
net basis; contract assets and contract liabilities under different contracts are not offset.
34. Employee remuneration
(1) Accounting treatment method for short-term remuneration
Short-term remuneration includes salaries, bonuses, allowances and subsidies, employee welfare, medical insurance
fees, maternity insurance fees, employment injury insurance fees, housing provident funds, labor union fees, staff
education funds, and non-monetary welfare. The Company shall, within the accounting period when its employees
provide service, recognize actual short-term remuneration as liabilities which shall be recognized as profit and loss
of the current period or relevant asset costs. Wherein, non-monetary benefits are measured at fair value.
(2) Accounting treatment method for post-employment benefits
Post-employment benefit includes basic endowment insurance, unemployment insurance, etc. It also includes
defined contribution plans. Where defined contribution plans are adopted, the corresponding amount payable shall
be recognized as profit and loss of the current period or relevant asset costs in which it is incurred.
(3) Accounting treatment method for dismissal benefits
If the Company terminates the labor relationship with an employee before the employee’s labor contract expires, or
proposes to give the employee compensation for encouraging the employee to voluntarily accept dismissal, the
liabilities arising from the compensation giving to the employee for the termination of the labor relationship with
the employee shall be recognized as profit and loss of the current period, when the Company cannot unilaterally
withdraw the termination of the labor relationship plan or the dismissal proposal, or when it recognizes the costs
related to the restructuring of the payment of the dismissal benefits, whichever is earlier. However, if it is expected
that the dismissal benefits cannot be paid in full within twelve months after the end of the annual reporting period,
they shall be accounted for according to other long-term employee remunerations.
Internal retirement schemes for employees shall be accounted for following the same principles of the above
dismissal benefits. Where the salaries and social insurance fees of early retirees to be paid by the Company from
the date when employees stop providing services to the normal retirement date meet the recognition conditions for
projected liabilities, they shall be recognized as profit and loss of the current period.
(4) Accounting treatment method for other long-term employee benefits
Other long-term benefits provided by the Company to employees that meet the conditions of the defined contribution
plan are accounted for in accordance with the defined contribution plan; other long-term benefits are accounted for
in accordance with the defined benefit plan.
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35. Lease liabilities
Recognition and accounting treatment methods of lease liabilities are detailed in "Note V (42) Leases".
36. Provision
An obligation related to contingent issues and meeting the following conditions shall be deemed a provision: (1)
such an obligation is a current one assumed by the Company; (2) fulfilling such an obligation might cause economic
benefits to flow out of the Company; and (3) the amount of such an obligation is measurable reliably.
On the balance sheet date, a provision is measured at the best estimate of the expenditure required to settle the
related present obligation, with comprehensive consideration of factors such as the risks, uncertainty and time value
of money relating to a contingency.
A provision is separately recognized as an asset and the recognized compensation amount shall not exceed the book
value of the provision, when all or part of the expenses required to pay off the provision are expected to be
compensated by a third party and the amount of compensation is basically determined to be receivable.
37. Share-based payment
Share-based payment is the transaction made through granting equity instruments or bearing the liabilities
recognized based on such instruments in exchange for services rendered by employees or other parties. The
Company’s share-based payment includes equity-settled share-based payment and cash-settled share-based
payment.
(1) Equity-settled share-based payment
Where the share payment is settled through equity for acquisition of service from employees, it shall be measured
at the fair value of the equity instruments granted to the employees. If the right cannot be exercised until the vesting
period ends or until the prescribed performance conditions are met, the amount of such fair value shall, based on
the best estimate of the number of vested equity instruments, be recognized as the relevant costs or expenses by
straight-line method; if the right can be exercised immediately following the grant, the amount of such fair value
shall be recognized as the relevant costs or expenses on the grant date, and the capital reserve shall be increased
accordingly.
On each balance sheet date within the vesting period, the Company carries out the best estimation based on such
follow-up information such as the variation of the number of vested staff acquired recently, and revises the number
of estimated vested equity instruments. The impact of the above estimates shall be recognized as the relevant costs
or expenses of the current period, and the capital reserve shall be adjusted accordingly.
For an equity-settled share-based payment in return for the service of any other party, if the fair value of the service
of any other party can be reliably measured, it shall be measured at the fair value of the service of any other party
on the acquisition date; if the fair value of the service of any other party cannot be reliably measured, but the fair
value of the equity instruments can be reliably measured, it shall be measured at the fair value of the equity
instruments on the acquisition date and included in the relevant costs or expenses, and the shareholders’ equity shall
be increased correspondingly.
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(2) Cash-settled share payment
The cash-settled share-based payment shall be measured at the fair value of the Company’s liabilities determined
based on shares or other equity instruments. If the right may be exercised immediately after the grant, relevant costs
or expenses shall be recognized the grant date, and the liabilities shall be increased accordingly. If the right may not
be exercised until the vesting period ends or until the specified performance conditions are met, on each balance
sheet date within the vesting period, the services obtained in the current period shall, based on the best estimate of
the information about the exercisable right, be recognized as the relevant costs or expenses at the fair value of the
liability undertaken by the Company, and liabilities shall be increased accordingly.
The fair value of liabilities is re-measured and any change thereto is recognized as profit and loss of the current
period on each balance sheet date and settlement date prior to settlement of the relevant liabilities.
38. Preference shares, perpetual bonds and other financial instruments: None
39. Revenue
Accounting policy for recognition and measurement of revenue
Revenue is the total inflow of economic benefits unrelated to the capital invested by the shareholders which are
formed in the daily activities of the Company and can lead to an increase in shareholders’ equity. The revenue is
recognized when the customers take control of the relevant goods (including services, same for below) if the contract
between the Company and the customers meet all the following conditions: 1) the parties to the contract have
approved such contract and undertake to perform their respective obligations; 2) the contract has specified the rights
and obligations of the parties thereto and in connection with the transfer of goods or provision of labor services; 3)
the contract sets out clear payment terms related to the transfer of goods; 4) the contract has commercial substance,
meaning that the performance thereof will change the risk, time distribution or amount of the Company’s future
cash flow; 5) the Company is very likely to recover the consideration obtained by transferring goods to customers.
Wherein, taking control of relevant goods means being able to control the use of the goods and obtain almost all
economic benefits therefrom.
On the enforcing date of the contract, the Company identifies all individual performance obligations in the contract,
and apportions the transaction price to each individual performance obligation according to the relative proportion
of the individual selling price of the goods. When determining the transaction price, the Company has considered
the impact of such factors including variable consideration, major financing component of the contract, non-cash
consideration, and consideration payable to the customer.
With respect to each individual performance obligation of the contract, the Company will recognize the transaction
price apportioned to such obligation as revenue based on the progress of performance during the relevant
performance periods, if any of the following conditions is met: 1) the customer obtains and consumes the economic
benefits brought by the Company’s performance during such performance; 2) the customer can control the goods
in progress during the Company’s performance; 3) the goods produced from the Company’s performance has
irreplaceable use, and in respect of the portion of revenue arising from the Company’s performance completed to
date, the Company is entitled to collect revenue during the entire validity period of the contract. The progress of
performance is determined according to the nature of the transferred goods using the input or output method. When
such progress cannot be reasonably determined, if the costs incurred are expected to be compensated, the Company
recognizes revenue based on the amount of costs incurred, until the progress of performance can be reasonably
determined.
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If none of the aforesaid conditions is met, the Company will recognize the transaction price apportioned to such
individual performance obligation when the customer obtains the control over relevant goods. To decide whether
the customer has obtained the control over goods, the Company takes into account the following indications: 1) the
enterprise has the present right to collection for the goods, meaning the customer bears the present obligation to
payment for the goods; 2) the enterprise has passed the legal title to the goods to the customer, meaning the customer
has had the legal title to the goods; 3) the enterprise has transferred the physical possession of the goods to the
customer, meaning the customer has had the physical possession of the goods; 4) the enterprise has transferred the
major risks and remunerations concerning the title to the goods to the customer, meaning the customer has obtained
the major risks and remunerations concerning the title to the goods; 5) the customer has accepted the goods; 6) other
indications to show that the customer has obtained the control over the goods.
Generally, the Company’s business of goods selling only comprises the performance obligation of transferring the
goods. The control of the goods is transferred when they are sent out and the Company receives the signed receipt
and other documents from the customer, so the Company confirms the realization of revenue at that point in time.
The discounts, rewards and other arrangements in some contracts between the Company and customers constitute
variable consideration. The Company uses the expected value method or the most likely amount to determine the
best estimates for variable consideration, but the transaction price containing variable consideration shall not exceed
the amount of cumulatively recognized revenue that is unlikely to have major reversals when the relevant
uncertainties are eliminated.
Different business models are adopted for different businesses, which may lead to the differences in the accounting
policy for recognition of revenue.
None
40. Government grants
Government grants are monetary or non-monetary assets acquired by the Company from the government free of
charge, excluding the capital invested by the government as an investor and granted corresponding owner’s equity.
Government grants are classified into government grants related to assets and government grants related to income.
The Company defines the government grants for purchasing or constructing or otherwise forming long-term assets
as asset-related government grants; other government grants are defined as the income-related government grants.
Government grants shall be measured at the amount received or receivable if they are monetary assets. Non-
monetary government grants shall be measured at fair value; if the fair value cannot be reliably obtained, they shall
be measured at the nominal amount. The government grants measured at the nominal amount shall be directly
recognized as the profit and loss of the current period.
Asset-related government grants are recognized as deferred income, and included in the profit and loss of the current
period in stages according to a reasonable and systematic method over the service life of the relevant assets. The
income-related government grants shall be recognized as deferred income if they are used to compensate relevant
expenses or losses in subsequent periods, and shall be recognized as profit and loss of the current period during the
recognition of related expenses; the grants used to compensate related expenses or losses already incurred shall be
directly recognized as profit and loss of the current period.
The government grants related to both assets and income shall be accounted for by distinguishing different parts; if
it is difficult to distinguish, they shall be, as a whole, classified as income-related government grants.
Government grants related to the Company’s daily activities shall be recognized as other profit and loss or write
down relevant costs according to the essence of economic business; those unrelated to the Company’s daily activities
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shall be recognized as non-operating income and expenditure.
If the recognized government grants need to be returned and there is relevant deferred income balance, the book
balance of relevant deferred income shall be written off, and the excess shall be recognized as profit and loss of the
current period; otherwise, government grants shall be directly recognized as profit and loss of the current period.
41. Deferred income tax assets/deferred income tax liabilities
(1) Current income tax
On the balance sheet date, the Company measures a current tax liability (or asset) arising from the current and prior
periods based on the amount of income tax expected to be paid by the Company (or returned by tax authority)
calculated by related tax laws. The taxable income which is the basis for calculation of the current income tax is
calculated after appropriate adjustments to the pretax accounting profits for the reporting period.
(2) Deferred income tax assets and deferred income tax liabilities
For the difference between the book value of certain assets and liabilities and their tax bases, and the temporary
differences between the book values and the tax bases of items, of which the tax bases can be determined for tax
purposes according to the tax laws but which have not been recognized as assets and liabilities, the Company
recognizes deferred income tax assets and deferred income tax liabilities using the balance sheet debt method.
Where the taxable temporary differences arise from the initial recognition of goodwill and the initial recognition of
an asset or liability arising from the transaction that is not a business combination, nor, at the time of the transaction,
affects neither accounting profit and taxable profit (or deductible loss), the relevant deferred income tax liability
shall not be recognized. Additionally, in respect of taxable temporary difference associated with investments in
subsidiaries, joint ventures and associates, where the Company can control the timing of the reversal of the
temporary differences and it is probable that the temporary differences will not be reversed in the foreseeable future,
the relevant deferred income tax liability shall not be recognized. Other than the above exceptions, the Company
shall recognize deferred income tax liabilities arising out from all other taxable temporary differences.
Where the deductible temporary differences arise from the initial recognition of an asset or liability arising from the
transaction that is not a business combination, nor, at the time of the transaction, affects neither accounting profit
and taxable profit (or deductible loss), the relevant deferred income tax liability shall not be recognized. Additionally,
in respect of deductible temporary difference associated with investments in subsidiaries, joint ventures and
associates, where it is probable that the temporary differences will not be reversed in the foreseeable future or
taxable profit will not be available against which the deductible temporary differences can be utilized in the future,
the relevant deferred income tax liability shall not be recognized. Other than the above exceptions, the Company
recognizes a deferred tax asset for other deductible temporary differences, to the extent that it is probable that future
taxable profit will be available against which the deductible temporary differences can be utilized.
The tax effects of deductible losses and taxes available for carrying over are recognized as an asset when it is
probable that future taxable profits would be available against which these losses can be utilized.
At the balance sheet date, deferred tax assets and liabilities are measured at the tax rates that are expected to apply
to the period when the asset is realized or the liability is settled, according to the requirements of tax laws.
The book value of deferred tax assets is reviewed at the balance sheet date and written down to the extent that it is
no longer probable that sufficient taxable profit will be available in future periods to allow the deferred tax assets
to be utilized. Such write-down is reversed when it becomes probable that sufficient taxable profits will be available.
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(3) Income tax expenses
Income taxes comprise current income tax and deferred income tax.
The current income tax and deferred income tax expense or income is recognized as the profit and loss of the current
period except that the current income tax and deferred income tax is related to transactions or events, which are
recognized as other comprehensive income or directly recognized as shareholders’ equity, and thus recognized as
other comprehensive income or shareholders’ equity, and that the book value of goodwill is adjusted due to deferred
income tax arising from business combination.
42. Leases
A lease is a contract whereby the Company assigns or acquires the right to control the use of one or more identified
assets for a specified period in exchange for or with payment of consideration. The Company evaluates whether a
contract is a lease or contains a lease at its inception date.
(1) The Company as the lessee
Main types of assets leased by the Company are properties and buildings.
① Initial measurement
Except for short-term leases or low-value asset leases, the Company recognizes the right to use the leased asset
during the lease term as a right-of-use asset and recognizes the present value of unpaid lease payments as a lease
liability. When calculating the present value of lease payments, the Company adopts the interest rate implicit in the
lease as the discount rate; if the interest rate implicit in the lease cannot be determined, the lessee’s incremental
borrowing rate is used as the discount rate.
② Follow-up measurement
The Company depreciates the right-of-use assets with reference to relevant depreciation provisions specified in the
Accounting Standards for Business Enterprises No. 4 - Fixed Assets (see "Note V ((24) Fixed Assets"). If it is
reasonably ascertained that the ownership of the asset will be transferred to the lessee at the end of the lease term,
then depreciation period runs to the end of the useful life of the lease asset. If it cannot be reasonably ascertained
that the ownership of the leased asset will be transferred to the lessee at the end of the lease term, then depreciation
period runs to the earlier of the end of the useful life of the asset or the end of the lease term.
For lease liabilities, the Company calculates its interest expenses in each period of the lease term at a fixed periodic
interest rate which is included in the profit and loss of the current period. Variable lease payments that are not
included in the measurement of lease liabilities are included in the current profit and loss when they are actually
incurred
After the commencement date of the lease term, when there is a change in the actual fixed payment amount, a
change in the estimated payable amount of the guaranteed residual value, a change in the index or ratio used to
determine the lease payment amount, or a change in the evaluation results or actual exercise of the purchase option,
renewal option or termination option, the Company re-measures the lease liability according to the present value of
the changed lease payments and adjusts the book value of the right-of-use asset accordingly. If the book value of
the right-of-use asset has been reduced to zero but the lease liability still needs to be further reduced, the Company
includes the remaining amount in the profit and loss of the current period.
③ Short-term leases and low-value asset leases
For short-term leases (leases with a term of not more than 12 months since the lease commencement date) and low-
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value asset leases Lease liabilities, the Company adopts a simplified approach, i.e. Not recognizing as right-of-use
assets but as the cost of the related asset or as profit and loss of the current period in accordance with the straight-
line method or other systematically reasonable methods during each period of the lease.
(2) The Company as the lessor
On the lease commencement date, the company divides leases into finance leases and operating leases based on the
substance of the transaction. Leases of assets where substantially all the risks and rewards of ownership have been
transferred are classified as finance leases. Other leases than the finance leases are classified as operating leases.
i. Operating lease
The Company adopts the straight-line method to recognize lease receipts from operating leases as rental income for
each period of the lease term. Variable lease payments related to operating leases that are not included in lease
receipts are included in the current profit and loss when they are actually incurred.
ii. Finance lease
The company recognizes the finance lease receivables and derecognizes the finance lease assets on the
commencement date of the lease term. The financial lease receivables are initially measured by the net investment
in the lease (the sum of the unguaranteed residual value and the present value of the lease receipts not yet received
at the beginning of the lease term, discounted at the interest rate implicit in the lease), while interest income is
calculated and recognized according to the fixed periodic interest rate in each period of the lease term. Variable
lease payments obtained by the Company that are not included in the measurement of the net value of lease liabilities
are included in the current profit and loss when they are actually incurred.
(1) Accounting treatment method for operating lease: Not applicable
(2) Accounting treatment method for finance lease: Not applicable
43. Other important accounting policies and accounting estimates
None
44. Significant changes of accounting policies and accounting estimates
(1) Significant changes of accounting policies
√ Applicable □ Not applicable
Contents and reasons for changes to accounting policies Approval procedure Remarks
In December 13, 2022, the Ministry of Finance issued the
Interpretation No. 16 to Accounting Standards for Business On August 25, 2023, the
Enterprises (hereinafter referred to as the “Interpretation No. Company convened the 23th
16”), which stipulated that contents regarding “accounting meeting of the fifth session of Details can be found in the
treatment when the deferred tax related to assets or liabilities the Board of Directors and the Announcement on Changes to
arising from a single transaction does not apply the initial 18th meeting of the fifth Accounting Policies dated
recognition exemption”, “accounting treatment for the session of the Board of August 28, 2023 on CNINFO
dividends of financial instruments classified as equity Supervisors, and approved the (http://www.cninfo.com.cn) .
instruments by the issuer” and “accounting treatment for the Proposal on Changes to
change of cash-settled share-based payment transaction to Accounting Policies.
equity-settled shared-based payment transaction”.
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(2) Significant changes of accounting estimates
□ Applicable √ Not applicable
45. Others: None
VI. Taxes
1. Main tax types and tax rates
Tax Tax basis Tax rate
Taxable VAT (calculated based on the difference of
deducting the amount of input tax which is allowed to be
Value-added tax 13%, 9%,6%,5%
deducted in the current period from the result of
multiplying taxable sales by applicable tax rate)
City construction and maintenance tax Turnover tax paid 5%, 7%
15%, 16.5%, 20%, 25%,
Corporate income tax Taxable income
progressive rate
Education surcharges Turnover tax paid 3%
Local education surcharges Turnover tax paid 2%
Description of disclosure if different income tax rates apply to different corporate taxpayers
Income tax
Name of taxpayer
rate
C&S Paper Co., Ltd., Zhongshan Zhongshun Trading Co., Ltd., C&S (Hubei) Paper Co., Ltd., Zhejiang
Zhongshun Paper Co., Ltd., Chengdu Zhongshun Paper Co., Ltd., Hangzhou Jie Rou Trading Co., Ltd., Beijing
C&S Paper Co., Ltd., Sun Daily Necessities Co., Ltd., C&S (Dazhou) Paper Co., Ltd., Shanghai Huicong Paper 25%
Co., Ltd., Yunfu Hengtai Trading Co., Ltd., C&S (Jiangsu) Paper Co., Ltd., Xiaogan C&S Trading Co., Ltd. and
Quxian Jiezhu Construction and Development Co., Ltd.
C&S (Zhongshan) Paper Co., Ltd., Beijing Bloomage Jierou Biotechnology Co., Ltd., Dolemi Sanitary Products
Co., Ltd., Zhengzhou Dolemi Sanitary Products Co., Ltd., Xi’an Dolemi Sanitary Products Co., Ltd, Guangdong 20%
Huashun Material Technology Co., Ltd and Guangdong Laotongxue Information Technology Co., Ltd.
Zhong Shun International Co., Ltd., and C&S Hong Kong Co., Ltd. (Note 1) 16.50%
Jiangmen Zhongshun Paper Co., Ltd., C&S (Sichuan) Paper Co., Ltd., and C&S (Yunfu) Paper Co., Ltd. 15%
Progressive
C&S (Macao) Co., Ltd. (Note 2)
rate
2. Tax incentive
C&S (Sichuan) Paper Co., Ltd. was certified as a high-tech enterprise of Sichuan Province in 2020 and was awarded
the Certificate of High-tech Enterprise (No. GR202051001193) in September, 2020, with a valid term of three years.
Therefore, the corporate income tax is calculated at a tax rate of 15% in 2021.
C&S (Yunfu) Paper Co., Ltd. was certified as a high-tech enterprise of Guangdong Province in 2020 and was
awarded the Certificate of High-tech Enterprise (No. GR202044006774) in December, 2020, with a valid term of
three years. Therefore, the corporate income tax is calculated at a tax rate of 15% in 2021.
Jiangmen Zhongshun Paper Co., Ltd. was certified as a high-tech enterprise of Guangdong Province in 2021 and
was awarded the Certificate of High-tech Enterprise (No. GR202144006582) in December 2021, with a valid term
of three years. Therefore, the corporate income tax is calculated at a tax rate of 15% in 2021.
According to Interpretation No. 16 and in combination of its own conditions, the Company started to implement the
content regarding “accounting treatment when the deferred tax related to assets or liabilities arising from a single
transaction does not apply the initial recognition exemption” from January 1, 2023. In accordance with relevant
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provisions of the Announcement of the State Administration of Taxation on Issues Concerning the Implementation
of the Inclusive Income Tax Deduction and Exemption Policies for Small Low-profit Enterprises (STA Doc. [2022]
No. 13), the policy on inclusive income tax deduction and exemption for small low-profit enterprises is applicable
to C&S (Zhongshan) Paper Co., Ltd., Beijing Bloomage Jierou Biotechnology Co., Ltd., Dolemi Sanitary Products
Co., Ltd., Zhengzhou Dolemi Sanitary Products Co., Ltd., Xi’an Dolemi Sanitary Products Co., Ltd, Guangdong
Huashun Material Technology Co., Ltd and Guangdong Laotongxue Information Technology Co., Ltd in 2023. To
be specific, the annual taxable income of these enterprises that is not more than RMB3 million shall be included in
their taxable income at the reduced rate of 25%, with the applicable corporate income tax rate of 20%.
3. Others
Note 1: C&S Hong Kong Co., Ltd. is a Hong Kong-based company incorporated according to the laws of Hong
Kong, and adopts the tax laws thereof. The tax rate for its income tax is 16.50%.
Note 2: C&S (Macao) Co., Ltd. is a Macao-based company incorporated according to the laws of Macao. Its
complementary tax adopts a progressive rate (tax on taxable income that is less than MOP300,000 is exempted, and
the taxable income that is more than MOP 300,000 is taxed at 12%).
VII. Notes to Items of the Consolidated Financial Statements
1. Monetary fund
Unit: RMB
Item Balance at the end of the period Balance at the beginning of the period
Cash on hand 41,732.13 20,309.66
Bank deposits 1,640,753,819.23 1,231,680,951.11
Other monetary funds 79,362,880.15 93,086,280.72
Total 1,720,158,431.51 1,324,787,541.49
Including: Total deposits in overseas
290,901,965.21 165,068,426.96
banks
The total amount of funds with
restrictions on use due to mortgage, 70,238,291.22 75,889,516.90
pledge, or freezing
Other description
Balance of other monetary funds at the end of the reporting period is the security deposit for issuing letters of credit
and bank acceptance bill and balance of Alipay. Refer to "Note VII (81)" for circumstances where ownership of
monetary funds is restricted.
2. Tradable financial assets: None
3. Derivative financial assets: None
4. Notes receivable
(1) Notes receivable presentation by category
Unit: RMB
112
C&S Paper Co., Ltd. Semi-annual Report 2023
Item Balance at the end of the period Balance at the beginning of the period
Bank acceptance bill 11,389,001.93 9,871,092.80
Trade acceptance bill 1,500,000.00
Total 11,389,001.93 11,371,092.80
If the bad debt reserve of notes receivable is set aside according to general model of expected credit loss, please
refer to the disclosure method of other receivables to disclose relevant information on bad debt reserve:
□ Applicable √ Not applicable
(2) Bad debt reserve that is set aside, recovered or transferred back in the reporting period: None
Wherein, the amount of recovered or transferred back bad debt reserve in the reporting period is important:
□ Applicable √ Not applicable
(3) Notes receivable that the Company has pledged at the end of the reporting period: None
(4) Notes receivable that the Company has endorsed or discounted at the end of the reporting period and are
not due on the balance sheet date: None
(5) Notes that are transferred to notes receivable because the drawer does not perform the contract at the
end of the reporting period: None
Other description
1.As of June 30, 2023, the Company has no pledged notes receivable as at the end of the year.
2.As of June 30, 2023, the Company has no derecognized notes receivable that are endorsed or discounted but not
due as at the end of the year.
3.As of June 30, 2023, the Company has no notes that are transferred to notes receivable because the drawer does
not perform the contract as at the end of the year.
(6) Notes receivable actually written off in the reporting period: None
5. Accounts receivable
(1) Accounts receivable disclosure by category
Unit: RMB
Balance at the end of the period Balance at the beginning of the period
Categor Impairment Impairment
Book balance Book balance
provision Book provision Book
y
Percenta Provisio value Percenta Provisio value
Amount Amount Amount Amount
ge n ratio ge n ratio
Account
s
receivab
le for 34,992,4 15,136,1 19,856,3 34,992,4 15,136,1 19,856,3
2.87% 43.26% 3.10% 43.26%
which 17.09 03.86 13.23 17.09 03.86 13.23
bad debt
reserve
is set
113
C&S Paper Co., Ltd. Semi-annual Report 2023
aside
individu
ally
Includin
g:
Account
s
receivab
le for
which
1,183,55 29,684,7 1,153,87 1,092,72 28,446,9 1,064,27
bad debt 97.13% 2.51% 96.90% 2.60%
reserve 9,651.60 60.92 4,890.68 0,726.79 01.51 3,825.28
is set
aside in
portfolio
s
Includin
g:
Portfolio
1,183,55 29,684,7 1,153,87 1,092,72 28,446,9 1,064,27
based on 97.13% 2.51% 96.90% 2.60%
aging 9,651.60 60.92 4,890.68 0,726.79 01.51 3,825.28
1,218,55 44,820,8 1,173,73 1,127,71 43,583,0 1,084,13
Total 100.00% 3.68% 100.00% 3.86%
2,068.69 64.78 1,203.91 3,143.88 05.37 0,138.51
Bad debt reserve set aside individually: 15,136,103.86
Unit: RMB
Balance at the end of the period
Name
Book balance Impairment provision Ratio of provision Reason for provision
It is difficult to recover
all goods payments due
Institution 1 22,180,045.16 8,218,072.46 37.05% to the poor business
performance of the
customer.
It is difficult to recover
all goods payments due
Institution 2 6,695,735.27 4,455,035.27 66.54% to the poor business
performance of the
customer.
It is difficult to recover
all goods payments due
Institution 3 6,116,636.66 2,462,996.13 40.27% to the poor business
performance of the
customer.
合计 34,992,417.09 15,136,103.86
Bad debt reserve set aside in portfolios: 29,684,760.92
Unit: RMB
Balance at the end of the period
Name
Book balance Impairment provision Ratio of provision
Within the credit period 1,066,099,812.77 21,321,996.26 2.00%
Credit period - 1 year 108,280,836.21 5,414,041.81 5.00%
1 to 2 years 4,070,310.96 610,546.64 15.00%
2 to 3 years 1,080,848.11 324,254.43 30.00%
3 to 5 years 4,027,843.55 2,013,921.78 50.00%
Over 5 years 1,183,559,651.60 29,684,760.92
Description of reason for the portfolio:
Accounts receivable with the same aging have similar credit risk characteristics.
If the bad debt reserve of accounts receivable is set aside according to general model of expected credit loss,
114
C&S Paper Co., Ltd. Semi-annual Report 2023
please refer to the disclosure method of other receivables to disclose relevant information on bad debt reserve:
□ Applicable √ Not applicable
Disclose by aging
Unit: RMB
Aging Book balance
Within 1 year (inclusive) 1,174,380,648.98
1 to 2 years 10,766,046.23
2 to 3 years 1,080,848.11
Over 3 years 32,324,525.37
3 to 4 years 49,897.62
4 to 5 years 3,977,945.93
Over 5 years 28,296,681.82
Total 1,218,552,068.69
(2) Bad debt reserve that is set aside, recovered or transferred back in the reporting period
Provision of bad debt reserve of the reporting period:
Unit: RMB
Balance at the Amount of change in the reporting period Balance at the
Category beginning of Recovery or end of the
the period Provision Write-off Others period
reversal
Accounts
43,583,005.37 1,237,859.41 44,820,864.78
receivable
Total 43,583,005.37 1,237,859.41 44,820,864.78
Wherein, the amount of recovered or transferred back bad debt reserve in the reporting period is important: None
(3) Accounts receivable actually written off in the reporting period: None
(4) Top five debtors in closing balance of accounts receivable
Unit: RMB
Balance of accounts Percentage in total balance of
Balance for bad debt reserve
Name of institution receivable at the end of the accounts receivable at the end
at the end of the period
period of the period
1st 424,294,485.50 34.82% 8,493,895.37
2nd 103,051,042.06 8.46% 3,228,781.62
3rd 48,829,431.30 4.01% 976,588.63
4th 33,947,269.76 2.79% 695,730.59
5th 25,692,973.85 2.11% 513,859.48
Total 635,815,202.47 52.19%
(5) Amounts of assets and liabilities that are formed by the transfer and ongoing involvement of accounts
receivable
The Company has no amounts of assets and liabilities that are formed by the transfer and ongoing involvement of
accounts receivable as at the end of the reporting period.
115
C&S Paper Co., Ltd. Semi-annual Report 2023
(6) Accounts receivable derecognized due to transfer of financial assets
The Company has no accounts receivable derecognized due to the transfer of financial assets as at the end of the
reporting period.
Other description: None.
6. Accounts receivable financing
Increase and decrease of accounts receivable financing and changes in fair value in the reporting period
□ Applicable √ Not applicable
If the provisions for asset impairment of accounts receivable financing are set aside according to general model of
expected credit loss, please refer to the disclosure method of other receivables to disclose relevant information on
provisions for asset impairment:
□ Applicable √ Not applicable
7. Prepayments
(1) Prepayments presentation by aging
Unit: RMB
Balance at the end of the period Balance at the beginning of the period
Aging
Amount Percentage Amount Percentage
Within 1 year 15,250,103.86 100.00% 15,291,351.73 100.00%
Total 15,250,103.86 15,291,351.73
Explanation on the reason of untimely settlement of prepayments whose age exceeds one year with significant
amount: None
(2) Top five payees in closing balance of prepayment
The Company’s total prepayment amount of the top five payees in closing balance of prepayment is RMB
11,089,368.68, accounting for 72.72% of closing balance of prepayment.
8. Other receivables
Unit: RMB
Item Balance at the end of the period Balance at the beginning of the period
Other receivables 15,877,583.96 16,915,272.60
Total 15,877,583.96 16,915,272.60
116
C&S Paper Co., Ltd. Semi-annual Report 2023
(1) Interest receivable
1) Classification of interest receivable: None
2) Significant overdue interest: None
3) Provision of bad debt reserve
□ Applicable √ Not applicable
(2) Dividends receivable
1) Classification of dividends receivable: None
2) Significant dividends receivable exceeding one year: None
3) Provision of bad debt reserve
□ Applicable √ Not applicable
Other description: None
(3) Other receivables
1) Classification of other receivables by nature
Unit: RMB
Book balance at the beginning of the
Nature Book balance at the end of the period
period
Current accounts 7,787,922.39 7,890,771.57
Margins and deposits 8,062,298.78 6,069,070.04
Reserve 2,446,003.40 2,691,372.66
Others 713,840.99 2,869,499.74
Total 19,010,065.56 19,520,714.01
2) Provision of bad debt reserve
Unit: RMB
Phase I Phase II Phase III
Expected credit losses Expected credit losses
Bad debt provision Expected credit loss in in the whole duration in the whole duration Total
the next 12 months (without credit (with credit
impairment) impairment)
Balance as at January
2,605,441.41 2,605,441.41
1, 2023
Balance as at January
1, 2023 in the reporting
period
Provision in the 527,040.19 527,040.19
117
C&S Paper Co., Ltd. Semi-annual Report 2023
reporting period
Balance as at June 30,
3,132,481.60 3,132,481.60
2023
Description of changes in the book balance where there are significant changes in provision for the current period
□ Applicable √ Not applicable
Disclose by aging
Unit: RMB
Aging Balance at the end of the period
Within 1 year (inclusive) 14,461,160.13
1 to 2 years 382,317.36
2 to 3 years 1,071,090.67
Over 3 years 3,095,497.40
3 to 4 years 487,250.00
4 to 5 years 1,642,247.22
Over 5 years 966,000.18
Total 19,010,065.56
3) Bad debt reserve that is set aside, recovered or transferred back in the reporting period
Provision of bad debt reserve of the reporting period:
Unit: RMB
Amount of change in the reporting period Balance at the
Balance at the
Type Recovery or end of the
beginning of the period Provision Write-off Others
reversal period
Other receivables 2,605,441.41 527,040.19 3,132,481.60
Total 2,605,441.41 527,040.19 3,132,481.60
4) Other receivables actually written off in the reporting period: None
5) Top five debtors in closing balance of other accounts receivable
Unit: RMB
Percentage in total
Name of Balance at the Balance of bad
balance of other
instituti Nature of the amount end of the Aging debt reserve at the
receivables at the
on period end of the period
end of the period
1st Current accounts 1,002,000.00 Within 1 year 5.27% 50,100.00
2nd Margins and deposits 900,500.00 4-5 years 4.74% 450,250.00
Within 1 year, 1-2 years, 2- 3
3rd Margins and deposits 900,000.00 4.73% 655,000.00
years, 3-4 years, over 5 years
Within 1 year, 1-2 years, 2- 3
4th Margins and deposits 645,500.00 years, 3-4 years, 4-5 years， 3.40% 326,025.00
over 5 years
5th Current accounts 629,891.67 Within 1 year 3.31% 31,494.58
Total 4,077,891.67 21.45% 1,512,869.58
118
C&S Paper Co., Ltd. Semi-annual Report 2023
6) Receivables involving government grants: None
7) Other receivables derecognized due to the transfer of financial assets: None
8) Amount of assets and liabilities that are formed by the transfer and ongoing involvement of other
receivables: None
9. Inventory
Whether the Company needs to comply with requirements for disclosure in the real estate industry: No
(1) Classification of inventories
Unit: RMB
Balance at the end of the period Balance at the beginning of the period
Provision for
Provision for
impairment
impairment of
of
inventories or
Item inventories
Book balance provision for Book value Book balance Book value
or provision
contract
for contract
performance
performance
cost
cost
1,116,335,594.
Raw materials 498,099,743.91 3,930,313.13 494,169,430.78 1,120,294,078.05 3,958,483.30
75
Work-in-
process 87,256,007.12 1,375,287.67 85,880,719.45 108,420,732.66 858,734.39 107,561,998.27
products
Commodity 10,309,137.5
602,180,835.14 9,842,173.05 592,338,662.09 619,274,397.98 608,965,260.41
stocks 7
Packages 31,830,600.64 484,291.64 31,346,309.00 37,055,688.67 416,133.78 36,639,554.89
Low-value
21,931,177.76 3,110,711.23 18,820,466.53 20,499,334.30 2,540,724.48 17,958,609.82
consumables
Materials for
consigned 18,587,387.75 18,587,387.75 24,169,705.41 24,169,705.41
processing
1,259,885,752. 1,241,142,975.6 18,083,213.5 1,911,630,723.
Total 18,742,776.72 1,929,713,937.07
32 0 2 55
(2) Provision for impairment of inventories or provision for contract performance cost
Unit: RMB
Balance at the Increase in the current period Decrease in the current period
Balance at the end
Item beginning of the Reversal or
Provision Others Others of the period
period written off
Raw materials 3,958,483.30 554,386.19 582,556.36 3,930,313.13
Work-in-
process 858,734.39 1,241,360.11 724,806.83 1,375,287.67
products
Commodity
10,309,137.57 4,869,241.11 5,336,205.63 9,842,173.05
stocks
119
C&S Paper Co., Ltd. Semi-annual Report 2023
Packages 416,133.78 291,636.17 223,478.31 484,291.64
Low-value
2,540,724.48 700,148.02 130,161.27 3,110,711.23
consumables
Total 18,083,213.52 7,656,771.60 6,997,208.40 18,742,776.72
(3) Explanation that balance of inventory at the end of the reporting period includes amount of capitalization
of borrowing costs: None
(4) Explanation on amortized amount of contract performance cost in the reporting period: None
10. Contract assets: None
11. Assets held for sale: None
12. Non-current assets due within one year: None
13. Other current assets
Unit: RMB
Item Balance at the end of the period Balance at the beginning of the period
Large-denomination Certificate of Deposit 601,000,000.00 210,000,000.00
Wealth management products 520,600,000.00
Input VAT to be deducted 26,340,360.89 101,907,351.54
Treasury bond reverse repurchase 10,007,000.00 23,001,000.00
Prepaid corporate income tax 51,002.37
Total 1,157,947,360.89 334,959,353.91
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C&S Paper Co., Ltd. Semi-annual Report 2023
14. Investments in creditor’s rights: None
15. Other investments in creditor’s rights: None
16. Long-term receivables
(1) Long-term receivables: None
(2) Long-term receivables derecognized due to the transfer of financial assets: None
(3) Amounts of assets and liabilities that are formed by the transfer and ongoing involvement of long-term
receivables: None
17. Long-term equity investment: None
18. Investment in other equity instruments: None
19. Other non-current financial assets: None
20. Investment property
(1) Investment property measured at cost
√ Applicable □ Not applicable
Unit: RMB
Properties and Construction work in
Item Land use rights Total
buildings progress
I. Original Book Value
1. Balance at the
31,072,632.92 21,661,131.29 52,733,764.21
beginning of the period
2. Increase in the
current period
(1) External purchase
(2) Inventory\fixed
assets\transfer from
construction work in
progress
(3) Increase in business
combination
3. Decrease in the
current period
(1) Disposal
(2) Other transfers out
4. Balance at the end of
31,072,632.92 21,661,131.29 52,733,764.21
the period
II. Accumulated
Depreciation and
121
C&S Paper Co., Ltd. Semi-annual Report 2023
Amortization
1. Balance at the
15,193,533.87 5,838,632.80 21,032,166.67
beginning of the period
2. Increase in the
549,514.14 168,927.96 718,442.10
current period
(1) Provision or
549,514.14 168,927.96 718,442.10
amortization
3. Decrease in the
current period
(1) Disposal
(2) Other transfers out
4. Balance at the end of
15,743,048.01 6,007,560.76 21,750,608.77
the period
III. Impairment
Provision
1. Balance at the
beginning of the period
2. Increase in the
current period
(1) Provision
3. Decrease in the
current period
(1) Disposal
(2) Other transfers out
4. Balance at the end of
the period
IV. Book Value
1. Book value at the
15,329,584.91 15,653,570.53 30,983,155.44
end of the period
2. Book value at the
15,879,099.05 15,822,498.49 31,701,597.54
beginning of the period
(2) Investment property measured at fair value
□ Applicable √ Not applicable
(3) Investment property that the certificate of title has not been issued
The Company does not have investment property that the certificate of title has not been issued as at June 30,
2023.
21. Fixed assets
Unit: RMB
Item Balance at the end of the period Balance at the beginning of the period
Fixed assets 2,848,133,013.46 3,013,559,312.97
Total 2,848,133,013.46 3,013,559,312.97
122
C&S Paper Co., Ltd. Semi-annual Report 2023
(1) Information on fixed assets
Unit: RMB
Properties and Office Production
Item Equipment Motor vehicles Total
buildings equipment equipment
I. Original
Book Value
1. Balance at
1,371,576,825. 3,605,484,997. 5,179,528,287.
the beginning 72,239,295.93 22,748,342.43 107,478,826.39
01 77 53
of the period
2. Increase in
the current 2,837,554.28 63,442,027.73 1,351,559.07 1,271,175.01 68,902,316.09
period
(1)
235,819.40 842,709.51 664,778.76 1,743,307.67
Purchase
(2)
Inventory\fixed
assets\transfer
from 2,837,554.28 63,206,208.33 508,849.56 606,396.25 67,159,008.42
construction
work in
progress
(3)
Increase in
business
combination
3. Decrease
in the current 68,000.00 91,298,975.80 1,160,786.85 4,751,043.81 3,141,234.95 100,420,041.41
period
(1)
Disposal or 68,000.00 20,886,221.43 1,160,786.85 4,751,043.81 3,141,234.95 30,007,287.04
scrap
(2) Other
70,412,754.37 70,412,754.37
transfers out
4. Balance at
1,374,346,379. 3,577,628,049. 5,148,010,562.
the end of the 72,430,068.15 17,997,298.62 105,608,766.45
29 70 21
period
II. Accumulated
Depreciation
1. Balance at
1,698,804,701. 2,148,190,292.
the beginning 328,463,784.70 42,106,720.32 12,317,156.27 66,497,929.43
of the period 37 09
2. Increase in
the current 25,781,093.27 158,197,563.96 4,504,432.58 1,105,097.69 7,198,254.23 196,786,441.73
period
(1)
25,781,093.27 158,197,563.96 4,504,432.58 1,105,097.69 7,198,254.23 196,786,441.73
Provision
3. Decrease
in the current 50,745.00 50,778,542.34 664,205.37 3,458,380.37 1,866,599.68 56,818,472.76
period
(1)
Disposal or 50,745.00 16,027,319.31 664,205.37 3,458,380.37 1,866,599.68 22,067,249.73
scrap
(2) Other
34,751,223.03 34,751,223.03
transfers out
4. Balance at 354,194,132.97 1,806,223,722. 45,946,947.53 9,963,873.59 71,829,583.98 2,288,158,261.
123
C&S Paper Co., Ltd. Semi-annual Report 2023
the end of the 99 06
period
III. Impairment
Provision
1. Balance at
the beginning 16,829,830.13 479,291.06 469,561.28 17,778,682.47
of the period
2. Increase in
the current
period
(1)
Provision
3. Decrease
in the current 6,049,870.14 214.65 9,309.99 6,059,394.78
period
(1)
Disposal or 6,049,870.14 214.65 9,309.99 6,059,394.78
scrap
4. Balance at
the end of the 10,779,959.99 479,076.41 460,251.29 11,719,287.69
period
IV. Book Value
1. Book
1,020,152,246. 1,760,624,366. 2,848,133,013.
value at the end 26,004,044.21 8,033,425.03 33,318,931.18
32 72 46
of the period
2. Book
value at the 1,043,113,040. 1,889,850,466. 3,013,559,312.
29,653,284.55 10,431,186.16 40,511,335.68
beginning of 31 27 97
the period
(2) Information on temporarily idle fixed assets
Unit: RMB
Original book Accumulated Impairment
Item Book value Remarks
value depreciation provision
Equipment 45,812,663.29 25,194,370.56 10,779,959.99 9,838,332.74
Office equipment 1,722,353.66 1,183,029.74 479,076.41 60,247.51
Production
1,035,975.24 544,516.97 460,251.29 31,206.98
equipment
Total 48,570,992.19 26,921,917.27 11,719,287.69 9,929,787.23
(3) Fixed assets leased through operating: None
(4) Fixed assets that the certificate of title has not been issued
Unit: RMB
Reasons for the certificate of title having
Item Book value
not been issued
Plants and warehouses of Tangshan
47,303,948.59 Processing
Branch
Total 47,303,948.59
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C&S Paper Co., Ltd. Semi-annual Report 2023
(5) Disposal of fixed assets: None
22. Construction work in process
Unit: RMB
Item Balance at the end of the period Balance at the beginning of the period
Construction work in process 167,569,837.60 142,627,123.42
Total 167,569,837.60 142,627,123.42
(1) Construction work in progress
Unit: RMB
Balance at the end of the period Balance at the beginning of the period
Item Impairmen Impairmen
Book balance Book value Book balance Book value
t provision t provision
Construction work
69,093,093.64 69,093,093.64 66,109,020.18 66,109,020.18
of C&S Paper
Construction work
8,720,992.62 8,720,992.62 6,474,001.68 6,474,001.68
of Jiangmen C&S
Construction work
172,655.37 172,655.37
of Zhejiang C&S
Construction work
30,367,497.73 30,367,497.73 40,399,919.70 40,399,919.70
of Tangshan Branch
Construction work
2,425,369.89 2,425,369.89 586,622.06 586,622.06
of Hubei C&S
Construction work
26,144,656.24 26,144,656.24 25,882,040.96 25,882,040.96
of Yunfu C&S
Construction work
530,582.07 530,582.07 530,582.07 530,582.07
of Jiangsu C&S
Construction work
29,554,801.81 29,554,801.81 2,644,936.77 2,644,936.77
of Dazhou C&S
Construction work
of Huashun 560,188.23 560,188.23
Technology
Total 167,569,837.60 167,569,837.60 142,627,123.42 142,627,123.42
(2) Changes of significant construction work in progress in the current period
Unit: RMB
Propor Includi
Amou
tion of Accum ng: Interes
nt of
Balanc the ulative Amou t
Increas fixed Decrea Balanc
e at the cumul Constr amoun nt of capital
Budget e in assets se in e at the
beginn ative uction t of interes ization Source
Project numbe the transfe the end of
ing of constr progre interes t rate in of fund
r current rred in current the
the uction ss t capital the
period the period period
period input capital ization current
current
in ization in the period
period
budget period
Constr
uction 76,780 66,109 69,093
work 2,984, 89.99 89.99
,225.4 ,020.1 ,093.6 Others
of 073.46 % %
C&S 7 8 4
Paper
Constr 11,835 6,474, 3,648, 1,401, 8,720, 85.53 85.53 Others
125
C&S Paper Co., Ltd. Semi-annual Report 2023
uction ,573.2 001.68 413.80 422.86 992.62 % %
work 8
of
Jiangm
en
C&S
Constr
uction
work
1,737, 1,715, 1,542, 172,65 98.71 98.71
of Others
Zhejia 490.09 044.89 389.52 5.37 % %
ng
C&S
Constr
uction
work 6,298, 6,298, 6,298, 100.00 100.00
Others
of 365.36 365.36 365.36 % %
Sichua
n C&S
Constr
uction
work 305,67 40,399 35,609 45,641 30,367
95.42 95.42
of 4,862. ,919.7 ,224.9 ,646.8 ,497.7 Others
Tangsh % %
31 0 1 8 3
an
Branch
Constr
uction 12,913 12,011 10,172
work 586,62 2,425, 97.56 97.56
,491.5 ,571.3 ,823.5 Others
of 2.06 369.89 % %
Hubei 1 7 4
C&S
Constr
uction 31,645 25,882 26,144
work 2,364, 2,102, 89.26 89.26
,821.8 ,040.9 ,656.2 Others
of 975.55 360.27 % %
Yunfu 2 6 4
C&S
Constr
uction 695,60
work 530,58 530,58
0,000. 0.08% 0.08% Others
of 2.07 2.07
Jiangs 00
u C&S
Constr
uction
825,00 26,909 29,554
work 2,644,
0,000. ,865.0 ,801.8 3.58% 3.58% Others
of 936.77
00 4 1
Dazho
u C&S
Constr
uction
work
of 7,270, 560,18 560,18
7.70% 7.70% Others
Huash 465.21 8.23 8.23
un
Techn
ology
1,974, 142,62 92,101 67,159 167,56
Total 756,29 7,123. ,722.6 ,008.4 9,837.
5.05 42 1 3 60
126
C&S Paper Co., Ltd. Semi-annual Report 2023
(3) Construction-in-progress provision set aside in the current period: None
Other description
There was no situation where the recoverable amount of the construction work in progress is lower than the book
value which required provisions in the Company in the reporting period.
(4) Construction materials: None
23. Productive biological assets
(1) Productive biological assets measured at cost
□ Applicable √ Not applicable
(2) Productive biological assets measured at fair value
□ Applicable √ Not applicable
24. Oil & gas assets
□ Applicable √ Not applicable
25. Right-of-use assets
Unit: RMB
Item Properties and buildings Total
I. Original Book Value
1. Balance at the beginning of the
24,157,728.10 24,157,728.10
period
2. Increase in the current period 13,501,317.24 13,501,317.24
3. Decrease in the current period 4,432,933.36 4,432,933.36
4. Balance at the end of the period 33,226,111.98 33,226,111.98
II. Accumulated Depreciation
1. Balance at the beginning of the
14,399,444.68 14,399,444.68
period
2. Increase in the current period 7,383,463.33 7,383,463.33
(1) Provision 7,383,463.33 7,383,463.33
3. Decrease in the current period 4,369,404.64 4,369,404.64
(1) Disposal 4,369,404.64 4,369,404.64
4. Balance at the end of the period 17,413,503.37 17,413,503.37
III. Impairment Provision
1. Balance at the beginning of the
period
2. Increase in the current period
(1) Provision
3. Decrease in the current period
(1) Disposal
4. Balance at the end of the period
IV. Book Value
1. Book value at the end of the period 15,812,608.61 15,812,608.61
127
C&S Paper Co., Ltd. Semi-annual Report 2023
2. Book value at the beginning of the
9,758,283.42 9,758,283.42
period
26. Intangible assets
(1) Intangible assets
Unit: RMB
Non-patented Application Trademark
Item Land use right Patent right Total
technology software right
I. Original
Book Value
1. Balance
at the beginning 241,594,322.15 1,733,287.88 25,875,086.67 168,370.83 269,371,067.53
of the period
2. Increase
in the current 5,600,000.00 2,087,306.44 7,687,306.44
period
(1)
5,600,000.00 2,087,306.44 7,687,306.44
Purchase
(2)
Internal R&D
(3)
Increase in
business
combination
3. Decrease
in the current
period
(1)
Disposal
4. Balance
at the end of the 241,594,322.15 7,333,287.88 27,962,393.11 168,370.83 277,058,373.97
period
II. Accumulated
Amortization
1. Balance
at the beginning 37,570,867.18 1,134,314.77 16,253,576.27 168,370.83 55,127,129.05
of the period
2. Increase
in the current 2,423,951.76 346,663.32 2,003,336.98 4,773,952.06
period
(1)
2,423,951.76 346,663.32 2,003,336.98 4,773,952.06
Provision
3.
Decrease in the
current period
(1)
Disposal
4. Balance
at the end of the 39,994,818.94 1,480,978.09 18,256,913.25 168,370.83 59,901,081.11
period
III. Impairment
Provision
1. Balance
at the beginning
of the period
2. Increase
in the current
period
(1)
Provision
128
C&S Paper Co., Ltd. Semi-annual Report 2023
3.
Decrease in the
current period
(1)
Disposal
4. Balance
at the end of the
period
IV. Book Value
1. Book
value at the end 201,599,503.21 5,852,309.79 9,705,479.86 217,157,292.86
of the period
2. Book
value at the
204,023,454.97 598,973.11 9,621,510.40 214,243,938.48
beginning of
the period
The intangible assets generated other than internal R&D of the Company at the end of the period occupy 0.00% of the balance of
intangible assets.
(2) Information on the land use rights that the certificate of title has not been issued: None
27. Development expenses: None
28. Goodwill
(1) Original book value of goodwill
Unit: RMB
Increase in the current Decrease in the
Balance at the period current period Balance at the
Name of investee or the matters
beginning of the Formed by end of the
forming goodwill
period business Disposal period
combination
Merger of Zhongshan Paper involving
64,654.15 64,654.15
enterprises not under common control
Merger of Quxian Jiezhu involving
633,136.34 633,136.34
enterprises not under common control
Total 64,654.15 633,136.34 697,790.49
(2) Provision for impairment of goodwill
Relevant information on the asset group or asset group portfolio in which the goodwill is located
Explain the method to confirm the process of goodwill impairment test, key parameters (e.g. the growth rate in the
predictive period when predicting the present value of future cash flow, the growth rate in the stable period, profit
rate, discount rate, and predictive period), and the goodwill impairment loss:
After conducting the asset impairment test by combining the goodwill with corresponding asset groups, there was
no impairment as at June 30, 2023, and provisions at the end of the reporting period were not set aside.
Influence of the goodwill impairment test
129
C&S Paper Co., Ltd. Semi-annual Report 2023
29. Long-term unamortized expenses
Unit: RMB
Balance at the Amortized
Increase in the Other Balance at the end
Item beginning of amount of the
current period decreases of the period
the period current period
Use rights of sewage discharge 251,447.96 41,908.02 209,539.94
Decoration fees of office buildings 9,598,356.75 137,999.75 3,647,360.70 6,088,995.80
Electricity use rights 1,635,550.00 309,750.00 1,325,800.00
Energy indicators 286,261.03 5,176,863.66 229,814.30 5,233,310.39
Total 11,771,615.74 5,314,863.41 4,228,833.02 12,857,646.13
30. Deferred income tax assets/deferred income tax liabilities
(1) Deferred income tax assets that were not offset
Unit: RMB
Balance at the end of the period Balance at the beginning of the period
Item Deductible temporary Deferred income tax Deductible temporary Deferred income tax
differences assets differences assets
Provision for asset
50,785,336.77 10,315,647.00 44,842,165.10 9,748,898.84
impairment
Unrealized profit in
21,209,221.12 4,332,327.23 45,044,696.11 9,641,645.08
internal transaction
Deductible loss 724,519,823.16 180,196,946.51 567,079,521.21 140,749,809.49
Accrued expenses 18,742,776.72 3,412,418.83 18,083,213.52 3,328,793.96
Provision for
impairment of fixed 11,719,287.69 2,269,795.90 17,778,682.47 3,294,136.72
assets
Provision for
impairment of 18,370,084.29 4,502,112.60 1,251,162.68 264,199.53
inventories
Equity incentive cost 89,060,568.76 22,265,142.19 89,060,568.74 22,265,142.19
Deferred income 81,465,785.53 15,954,419.39 87,700,783.44 17,164,031.25
Total 1,015,872,884.04 243,248,809.65 870,840,793.27 206,456,657.06
(2) Deferred income tax liabilities that were not offset
Unit: RMB
Balance at the end of the period Balance at the beginning of the period
Item Taxable temporary Deferred income Taxable temporary Deferred income
differences tax liabilities differences tax liabilities
Pre-tax deduction of fixed assets at one
153,023,160.79 28,007,494.21 238,373,819.49 47,131,368.70
time as stipulated in the tax law
Total 153,023,160.79 28,007,494.21 238,373,819.49 47,131,368.70
(3) Presentation of deferred income tax assets or liabilities by the net amount after offset
Unit: RMB
Item Offset amount of the Balance of the deferred Offset amount of the Balance of the deferred
130
C&S Paper Co., Ltd. Semi-annual Report 2023
deferred income tax income tax assets or deferred income tax income tax assets or
assets and liabilities at liabilities after offset at assets and liabilities at liabilities after offset at
the end of the reporting the end of the reporting the beginning of the the beginning of the
period period reporting period reporting period
Deferred income tax
assets 243,248,809.65 206,456,657.06
Deferred income tax
liabilities 28,007,494.21 47,131,368.70
(4) Breakdown of unconfirmed deferred income tax assets
Unit: RMB
Item Balance at the end of the period Balance at the beginning of the period
Deductible temporary differences 1,018,132.38 1,346,281.63
Total 1,018,132.38 1,346,281.63
(5) Deductible losses of the unconfirmed deferred income tax assets due in the next year: None
31. Other non-current assets
Unit: RMB
Balance at the end of the period Balance at the beginning of the period
Item Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Prepayment for engineering
equipment 17,444,577.73 17,444,577.73 3,096,668.04 3,096,668.04
Prepayment for software 2,460,101.16 2,460,101.16 2,742,366.30 2,742,366.30
Prepayment for land 22,230,000.00 22,230,000.00
Total 42,134,678.89 42,134,678.89 5,839,034.34 5,839,034.34
32. Short-term borrowings
(1) Classification of short-term borrowings
Unit: RMB
Item Balance at the end of the period Balance at the beginning of the period
Guaranteed borrowings 1,016,297,275.02 606,299,222.62
Credit loans 150,000,000.00
Discounting of unrecognized notes
1,500,000.00
receivable
Total 1,166,297,275.02 607,799,222.62
Description of classification of short-term borrowings:
The guaranteed loans are all guaranteed loans between related parties within the scope of the Company merger.
131
C&S Paper Co., Ltd. Semi-annual Report 2023
(2) Short-term borrowings overdue but unpaid: None
There were no short-term borrowings overdue but unpaid in the Company at the end of the reporting period.
33. Tradable financial liabilities: None
34. Derivative financial liabilities: None
35. Notes payable
Unit: RMB
Category Balance at the end of the period Balance at the beginning of the period
Banker’s acceptance 326,437,678.21 340,335,111.30
Total 326,437,678.21 340,335,111.30
The total amount of the notes payable due but unpaid at the end of the reporting period is RMB0.00.
36. Accounts payable
(1) List of accounts payable
Unit: RMB
Item Balance at the end of the period Balance at the beginning of the period
Accounts payable 809,845,342.70 948,550,430.61
Total 809,845,342.70 948,550,430.61
(2) Significant accounts payable with aging over one year
The Company has no significant accounts payable with aging over one year at the end of the reporting period.
37. Payments received in advance
(1) List of payments received in advance: None
(2) Significant payments received in advance with aging over one year: None
38. Contract liabilities
Unit: RMB
Item Balance at the end of the period Balance at the beginning of the period
Advances on sales 55,853,584.65 96,581,944.94
Total 55,853,584.65 96,581,944.94
132
C&S Paper Co., Ltd. Semi-annual Report 2023
39. Employee remuneration payable
(1) List of employee remuneration payable
Unit: RMB
Balance at the
Increase in the Decrease in the Balance at the end
Item beginning of the
current period current period of the period
period
I. Short-term Compensation 125,641,302.46 419,645,167.08 435,205,661.72 110,080,807.82
II. Post-employment Benefits - Defined
Contribution Plan 3,000,145.19 29,568,638.65 32,155,143.27 413,640.57
III. Dismissal Benefits 3,000,000.00 1,434,557.17 4,434,557.17
Total 131,641,447.65 450,648,362.90 471,795,362.16 110,494,448.39
(2) List of short-term remuneration
Unit: RMB
Balance at the beginning Increase in the Decrease in the Balance at the end
Item
of the period current period current period of the period
1. Salary, bonus and subsidy 124,624,901.23 378,301,918.61 394,224,207.25 108,702,612.59
2. Employee welfare 12,821,420.07 12,821,420.07
3. Social insurance premiums 380,431.33 15,212,188.41 15,342,374.92 250,244.82
Including: Medical insurance 152,356.90 13,378,017.25 13,306,651.58 223,722.57
Employment injury insurance 226,233.91 1,564,071.76 1,765,766.64 24,539.03
Maternity insurance 1,840.52 270,099.40 269,956.70 1,983.22
4. Housing provident fund 184,800.00 11,134,609.49 10,992,729.29 326,680.20
5. Labor union fee and staff education fee 451,169.90 2,175,030.50 1,824,930.19 801,270.21
Total 125,641,302.46 419,645,167.08 435,205,661.72 110,080,807.82
(3) List of defined contribution plans
Unit: RMB
Balance at the beginning Increase in the Decrease in the Balance at the end
Item
of the period current period current period of the period
1. Basic endowment insurance 2,930,653.01 28,433,807.06 30,965,273.69 399,186.38
2. Unemployment insurance 69,492.18 1,134,831.59 1,189,869.58 14,454.19
Total 3,000,145.19 29,568,638.65 32,155,143.27 413,640.57
Other description:
There was no delinquency of employee remuneration payable by the Company at the end of the reporting period.
40. Tax and fees payable
Unit: RMB
Item Balance at the end of the period Balance at the beginning of the period
Value-added tax 60,292,193.38 11,926,192.62
Corporate income tax 49,229,609.44 30,255,024.65
133
C&S Paper Co., Ltd. Semi-annual Report 2023
Individual income tax 2,291,369.06 2,200,055.48
City construction and maintenance tax 3,504,941.68 1,756,304.79
Property tax 4,061,766.19 1,403,446.94
Education surcharges 1,785,292.91 923,674.57
Local education surcharges 1,190,195.26 615,783.03
Land use tax 753,980.97 778,111.47
Stamp tax 2,291,295.45 2,599,126.99
Security fund for the disabled 998,211.85 672,176.96
Environmental protection tax 294,908.67 256,939.83
Resource tax 126,564.81 71,129.02
Total 126,820,329.67 53,457,966.35
41. Other payables
Unit: RMB
Item Balance at the end of the period Balance at the beginning of the period
Dividend payable 1,299,613.00
Other payables 949,015,560.71 807,423,814.13
Total 950,315,173.71 807,423,814.13
(1) Interest payable: None
(2) Dividends payable
Unit: RMB
Item Balance at the end of the period Balance at the beginning of the period
Dividends for restricted shares 1,299,613.00
Total 1,299,613.00
Other descriptions, including important dividends payable exceeding one year, and the reasons for non-payment that should be
disclosed: None
(3) Other payables
1) Other payables based on amount nature
Unit: RMB
Item Balance at the end of the period Balance at the beginning of the period
Unpaid fees 776,232,605.21 772,151,144.55
Repurchase obligation of restricted shares 132,476,680.00
Margins and deposits 37,745,699.72 29,983,785.18
Others 2,107,095.12 1,249,487.75
Authorized collection and payment of individual
453,480.66 4,039,396.65
income tax under the equity incentive
Total 949,015,560.71 807,423,814.13
2) Other important payables with aging exceeding one year
Unit: RMB
134
C&S Paper Co., Ltd. Semi-annual Report 2023
Item Balance at the end of the period Reason for unsettlement or not carry-over
1st 6,323,465.21 Not yet settled
Total 6,323,465.21 --
42. Liabilities held for sale: None
43. Non-current liabilities due within one year
Unit: RMB
Item Balance at the end of the period Balance at the beginning of the period
Lease liabilities due within one year 8,708,819.36 9,833,661.30
Total 8,708,819.36 9,833,661.30
44. Other current liabilities
Unit: RMB
Item Balance at the end of the period Balance at the beginning of the period
Tax pending changeover 7,191,894.60 12,440,147.55
Total 7,191,894.60 12,440,147.55
45. Long-term borrowings: None
46. Bonds payable: None
47. Lease liabilities
Unit: RMB
Item Balance at the end of the period Balance at the beginning of the period
Properties and buildings 17,383,886.30 10,637,540.60
Lease liabilities due within one year -8,708,819.36 -9,833,661.30
Total 8,675,066.94 803,879.30
48. Long-term payables: None
49. Long-term employee remuneration payable
50. Projected liabilities: None
51. Deferred income
Unit: RMB
Balance at the
Increase in the Decrease in the Balance at the end of
Item beginning of the Reason
current period current period the period
period
Government grants 98,419,983.82 7,942,880.68 90,477,103.14 Related to asset
135
C&S Paper Co., Ltd. Semi-annual Report 2023
Government grants
Total 98,419,983.82 7,942,880.68 90,477,103.14 --
Projects involving government grants:
Unit: RMB
Amount
Amount
Increased included Amount
included in
Balance at the amount of in non- of offset Other Balance at the Related to
other
Liability item beginning of grants in operating costs in chang end of the asset/incom
income in
the period the current income in the current es period e
the current
period the current period
period
period
Subsidies for
the
infrastructure Related to
28,393,061.36 535,718.16 27,857,343.20
construction of asset
new factory in
Hubei
Support funds
for the
construction of
Related to
Automated 18,065,441.14 780,882.36 17,284,558.78
asset
Storage &
Retrieval
System
Support funds
for the
1,125,711.2 Related to
transformation 11,669,812.69 10,544,101.45
4 asset
of Phase I
project
Financial
support funds
for construction
expansion of Related to
6,202,358.15 312,723.90 5,889,634.25
25,000-ton asset
high-grade
household paper
project
Support funds
for equipment Related to
5,641,078.07 935,595.60 4,705,482.47
of Phase II asset
project
Provincial-level
special
Related to
subsidies for 4,682,727.20 275,454.60 4,407,272.60
asset
high-quality
development
Subsidy funds
1,676,863.8 Related to
for the smart 4,831,637.53 3,154,773.68
5 asset
factory project
Ex-post funds
awarded to the
first batch of the
union Related to
2,846,909.86 265,537.56 2,581,372.30
enterprises for asset
technical
transformation
in 2017
Support funds
for the
construction of Related to
2,394,444.59 159,523.80 2,234,920.79
environmental asset
protection
facilities
136
C&S Paper Co., Ltd. Semi-annual Report 2023
Discount
interest funds Related to
2,051,843.75 96,937.50 1,954,906.25
for imported asset
equipment
Support funds
for the technical
Related to
transformation 2,055,541.64 392,201.70 1,663,339.94
asset
of equipment
production line
Subsidies for
the expansion of
the high-grade
Related to
household paper 1,586,666.91 79,999.98 1,506,666.93
asset
project with an
annual output of
25,000 tons
Subsidies for
sewage Related to
1,710,227.15 238,636.38 1,471,590.77
treatment asset
station
Support funds
for enterprise Related to
1,646,984.51 385,718.69 1,261,265.82
technical asset
upgrading
Subsidies for
construction of
Related to
the water 1,059,704.08 77,539.32 982,164.76
asset
treatment
project
District-level
support funds Related to
879,310.34 103,448.28 775,862.06
for technical asset
transportation
Support funds
for sewage
Related to
centralized 729,000.00 60,750.00 668,250.00
asset
water treatment
project
Provincial funds
for traditional
Related to
industry 696,428.62 53,571.42 642,857.20
asset
transformation
projects
Subsidies for
technical
Related to
transformation 605,973.09 98,566.32 507,406.77
asset
with “zero land
increase”
Special funds
for capacity
expansion of
Related to
25,000-ton 670,833.14 287,500.02 383,333.12
asset
high-grade
household paper
project
7,942,880.6
Total 98,419,983.82 90,477,103.14
8
Other description: None
137
C&S Paper Co., Ltd. Semi-annual Report 2023
52. Other non-current liabilities: None
53. Share capital
Unit: RMB
Increase and decrease of this change (+ and -)
Balance at the Shares Balance at the
beginning of the Issuance of Bonus transferred
Others Subtotal end of the period
period new shares shares from surplus
reserve
Total number
of shares 1,314,739,745.00 21,706,455.00 -1,895,900.00 19,810,555.00 1,334,550,300.00
Other description:
（1）According to the Proposal on Achieving the Exercise Conditions of the Third Exercise Period for Stock
Options Awarded in the First Grant under the Company’s 2018 Stock Option and Restricted Stock Incentive Plan
approved at the 14th meeting of the fifth session of the Board of Directors, the number of stock options that had met
exercise conditions was 3,314,312 and the number of incentive recipients in conformity with the exercise conditions
reached 2,000. The exercise period was from June 29, 2022 to March 3, 2023. According to the Proposal on
Achieving the Exercise Conditions of the Third Exercise Period for Reserved Stock Options under the Company’s
2018 Stock Option and Restricted Stock Incentive Plan approved at the 17th meeting of the fifth session of the Board
of Directors, the number of stock options that have met exercise conditions was 569,340 and the number of incentive
recipients in conformity with the exercise conditions reached 55. The exercise period is from December 8, 2022 to
Octomber 27, 2023. As of June 30, 2023, the incentive recipients who had met the above exercise conditions have
successively begun to exercise their rights, and a total of 744,955 shares have been subscribed.
(2) According to the resolutions of the 18th meeting of the Fifth Board of Directors, the 13th meeting of the Fifth
Board of Supervisors, the 2023 First Extraordinary General Meeting and the 19th meeting of the Fifth Board of
Directors, the Company awarded 21,765,000 restricted shares to 694 incentive recipients, with a par value of RMB1
per share and a grant price of RMB6.32 per share. Among them, 17 incentive recipients are no longer qualified
since they have resigned due to personal reasons and 78 recipients have voluntarily given up all or partial rights due
to personal reasons, so the actual number of recipients is 617 with 20,961,500 shares awarded.
(3) The Company completed the cancellation procedures for 1,895,900 shares in its specialized repurchase securities
account in May 2023.
54. Other equity instruments: None
55. Capital reserve
Unit: RMB
Balance at the beginning Increase in the current Decrease in the Balance at the end of
Item
of the period period current period the period
Capital premium (share premium) 677,865,067.00 119,137,564.99 797,002,631.99
Other capital reserve 280,322,930.99 29,687,986.01 27,915,393.06 282,095,523.94
Total 958,187,997.99 148,825,551.00 27,915,393.06 1,079,098,155.93
Other descriptions, including increase/decrease in the reporting period and reasons of change:
138
C&S Paper Co., Ltd. Semi-annual Report 2023
(1) The grant of restricted shares according to the 2022 Stock Option and Restricted Stock Incentive Plan increased
“capital reserve-share premium” by RMB111,515,180.00.
(2) The exercise of stock options awarded in the first grant and the exercise of reserved stock options as per the
2018 Stock Option and Restricted Stock Incentive Plan increased “capital reserve-share premium” by
RMB7,622,384.99 and decreased “capital reserve-other capital reserve” by RMB 2,130,571.30.
(3) The Company set aside provision for equity incentive costs and fees in the reporting period, which increased
“capital reserve-other capital reserve” by RMB29,687,986.01.
(4) The cancellation of repurchased shares decreased “capital reserve-other capital reserve” by RMB25,784,821.76.
56. Treasury shares
Unit: RMB
Balance at the beginning Increase in the current Decrease in the current Balance at the end of the
Item
of the period period period period
Restricted shares 132,476,680.00 132,476,680.00
Ordinary shares 688,930,693.99 27,680,721.76 661,249,972.23
Total 688,930,693.99 132,476,680.00 27,680,721.76 793,726,652.23
Other descriptions, including increase/decrease in the reporting period and reasons of change:
(1) The Company awarded 20,961,500.00 restricted shares under the first grant at a price of RMB6.32 per share in
accordance with the 2022 Stock Option and Restricted Stock Incentive Plan, which increased “treasury shares-restricted
shares” by RMB132,476,680.00.
(2) The Company’s cancellation of repurchased shares decreased “treasury shares-ordinary shares” by
RMB27,680,721.76.
57. Other comprehensive income: None
58. Special reserves: None
59. Surplus reserve
Unit: RMB
Balance at the beginning Increase in the current Decrease in the current Balance at the end of the
Item
of the period period period period
Statutory surplus reserve 145,882,689.86 145,882,689.86
Total 145,882,689.86 145,882,689.86
Explanation of surplus reserves, including increase/decrease in the reporting period and reasons of change:None
60. Retained earnings
Unit: RMB
Item Current period Last period
139
C&S Paper Co., Ltd. Semi-annual Report 2023
Retained earnings before adjustment at the end of the last period 3,448,180,639.62 3,265,611,428.36
Retained earnings at the beginning of the period after adjustment 3,448,180,639.62 3,265,611,428.36
Plus: Net profit attributable to owners of the parent company of the current period 84,490,174.46 227,639,705.35
Dividends on ordinary shares payable 81,200,607.21 128,609,710.60
Retained earnings at the end of the period 3,451,470,206.87 3,364,641,423.11
Details on adjusting retained earnings at the beginning of the period:
(1) As a result of retrospective adjustments according to the Accounting Standards for Business Enterprises and its
related new provisions, the impact on retained earnings at the beginning of the period was RMB0.00.
(2) Due to the changes in accounting policies, the impact on retained earnings at the beginning of the period was
RMB0.00.
(3) Due to the correction of material accounting errors, the impact on retained earnings at the beginning of the period
was RMB0.00.
(4) Due to the changes in the scope of combination caused by the same control, the impact on retained earnings at
the beginning of the period was RMB0.00.
(5) Other adjustments affected retained earnings at the beginning of the period by a total of RMB0.00.
61. Operating income and operating cost
Unit: RMB
Incurred in the current period Incurred in the prior period
Item
Income Cost Income Cost
Principal business 4,685,080,565.59 3,352,956,520.74 4,367,618,113.61 2,929,313,606.05
Total 4,685,080,565.59 3,352,956,520.74 4,367,618,113.61 2,929,313,606.05
Information related to income:
Unit: RMB
Contract classification Branch 1 Branch 2 Total
By product type 4,685,080,565.59 4,685,080,565.59
Including:
Household paper 4,623,891,020.45 4,623,891,020.45
Personal care and others 61,189,545.14 61,189,545.14
By operating region 4,685,080,565.59 4,685,080,565.59
Including:
Domestic 4,589,885,969.35 4,589,885,969.35
Abroad 95,194,596.24 95,194,596.24
By market or customer
type
Including:
Contract type
Including:
By the time of goods
transfer
140
C&S Paper Co., Ltd. Semi-annual Report 2023
Including:
By contract term
Including:
By sales channel 4,685,080,565.59 4,685,080,565.59
Including:
Traditional 2,148,756,056.09 2,148,756,056.09
Non-traditional 2,536,324,509.50 2,536,324,509.50
Total 4,685,080,565.59 4,685,080,565.59
Information related to performance obligation: None
Information related to the transaction price apportioned to the remaining performance obligation:
The amount of income corresponding to the obligations of contract performance with an executed contract that is not performed or
fully performed at the end of the reporting period is RMB 10,684,304.73, of which the income of RMB 10,684,304.73 is expected to
be confirmed as income in the year of 2023.
62. Tax and surcharges
Unit: RMB
Item Incurred in the current period Incurred in the prior period
City construction and maintenance tax 10,556,379.34 10,114,833.70
Education surcharges 5,131,744.47 4,692,198.88
Resource tax 65,442.75 59,687.49
Property tax 5,614,288.26 5,340,991.61
Land use tax 1,304,877.08 1,177,751.78
Vehicle and vessel tax 5,030.00
Stamp tax 4,129,350.82 3,793,856.69
Local education surcharges 3,424,022.70 3,128,132.57
Environmental protection tax 460,240.33 492,278.28
Total 30,686,345.75 28,804,761.00
63. Selling expenses
Unit: RMB
Item Incurred in the current period Incurred in the prior period
Employee remuneration 208,045,817.91 215,826,656.37
Product promotion fees 560,851,603.84 478,680,276.28
Transportation expenses 35,983,051.68 38,605,993.98
Advertising expenses 64,271,873.21 78,819,182.16
Shopping mall management fees 43,161,557.10 41,890,271.35
Traveling expenses 12,211,545.38 9,946,888.53
Rental fees 6,116,103.25 4,118,619.21
Depreciation of use right assets 1,859,083.38 1,613,750.38
Business entertainment expenses 1,413,630.50 1,735,211.16
Others 3,211,267.12 2,803,713.93
Total 937,125,533.37 874,040,563.35
141
C&S Paper Co., Ltd. Semi-annual Report 2023
64. Administrative expenses
Unit: RMB
Item Incurred in the current period Incurred in the prior period
Employee remuneration 73,641,882.22 80,051,121.32
Equity incentive cost 29,687,986.01 2,691,873.06
Depreciation and amortization fees 38,667,688.72 39,110,201.78
Office allowance 11,728,656.65 14,202,117.04
Consulting service fees 4,365,378.01 9,814,899.14
Outsourcing warehouse management fees 12,362,144.43 14,769,362.63
Business entertainment expenses 2,996,003.24 3,161,028.12
Traveling expenses 1,389,106.94 1,093,846.41
Environmental protection fees 1,551,570.61 1,482,429.20
Rental fees 3,205,715.79 1,917,577.82
Depreciation of use right assets 5,408,400.86 5,039,222.82
Others 3,770,178.03 6,842,755.06
Total 188,774,711.51 180,176,434.40
65. R&D expenses
Unit: RMB
Item Incurred in the current period Incurred in the prior period
Employee remuneration 22,124,267.15 18,993,635.08
Direct investment 81,883,493.27 72,375,500.71
Depreciation and amortization fees 14,546,606.28 12,333,210.15
Others 1,727,034.42 1,479,941.67
Total 120,281,401.12 105,182,287.61
66. Finance expenses
Unit: RMB
Item Incurred in the current period Incurred in the prior period
Interest fees 14,597,955.07 1,730,495.87
Less: Interest income 16,545,337.34 5,594,433.94
Exchange profit and loss -18,928,998.16 282,584.01
Transaction fee and others 4,390,150.44 2,114,303.84
Total 15,445.69
67. Other income
Unit: RMB
Sources of other income Incurred in the current period Incurred in the prior period
Refund of individual income tax 867,613.18 1,478,746.93
Subsidy funds for the smart factory project 1,676,863.85 1,485,927.20
Support funds for the transformation of Phase I project 1,125,711.24 1,125,711.24
Support funds for equipment of Phase II project 935,595.60 935,595.60
142
C&S Paper Co., Ltd. Semi-annual Report 2023
Special funds for development and reform 889,508.80
Subsidies for internship, employment, job stabilization and
845,075.63 1,267,492.81
training
Support funds for the construction of Automated Storage &
780,882.36 780,882.36
Retrieval System
Subsidies for Hubei C&S’s new factory infrastructure
535,718.16 535,718.16
construction
Special award funds for the restructuring of industrial enterprises 500,000.00 150,000.00
Subsidies for foreign trade stabilization 487,500.00 10,000.00
Subsidies for social insurance premiums 450,005.10 82,871.51
Support funds for the technical transformation of equipment 392,201.70 392,201.70
Support funds for enterprise technical upgrading 385,718.69 396,187.14
2013-2017 financial support funds of the Management Committee
312,723.90 312,723.90
of Pengzhou Industrial Development Zone, Sichuan Province
25,000 tons capacity expansion project of Tangshan Subsidiary 287,500.02 287,500.02
Provincial-level special subsidies for high-quality development 275,454.60 91,818.20
Ex-post funds awarded to the first batch of the union enterprises
265,537.56 317,293.32
for the technical transformation in 2017
Financial support for the sewage treatment station project of
238,636.38 238,636.38
Tangshan Subsidiary
District-level rewards for green factory 200,000.00
VAT exemption for employment of retired soldiers and poor
160,850.00 73,950.00
population
Enterprise support funds for the third level tax conference 160,000.00
Support funds for the construction of environmental protection
159,523.80 159,523.80
facilities
Subsidies for boiler renovation 157,500.00
District-level support funds for technical transportation 103,448.28 17,241.38
Subsidies for technical transformation with “zero land increase” 98,566.32
Import interest discounts on imported equipment in 2014 96,937.50 96,937.50
Special subsidy for the construction expansion of the 25,000-ton
79,999.98 79,999.98
household paper project
Subsidies for construction of the water treatment project 77,539.32 77,539.32
Special funding for the implementation of standardization
75,000.00
strategy in Zhongshan City
Financial support for sewage centralized water treatment project 60,750.00 60,750.00
Provincial funds for traditional industry transformation projects 53,571.42 53,571.42
Job increase subsidy 6,000.00
Subsidies for new-generation IT and industrial development
1,980,000.00
projects
Automatic payment of Xinhui District for enterprise awards under
500,000.00
the “Ten Golden Rules” 2021
Funds for reconstruction project of automatic production lines 368,766.67
Tax contribution reward 200,000.00
One-off job retention subsidy 185,000.00
Rewards for creation of odor-free enterprise 41,834.86
Industrial comprehensive policy fulfillment fund 2020; Special
30,000.00
subsidy for high-tech enterprise identification 2020
Subsidies for employees’ training while working 4,000.00
Energy review fee from the reform and development department's
1,500.00
special business fee
Total 12,741,933.39 13,819,921.40
68. Return on investment
Unit: RMB
143
C&S Paper Co., Ltd. Semi-annual Report 2023
Item Incurred in the current period Incurred in the prior period
Investment income from disposal of trading financial assets 968,000.00
Others 990,155.36 183,493.42
Total 1,958,155.36 183,493.42
Other description:
"Others" refer to returns on principal-protected wealth management products at maturity.
69. Profit of net exposure hedging: None
70. Income from changes in fair value
Unit: RMB
Sources of income from changes in fair value Incurred in the current period Incurred in the prior period
Stock -2,538.48
Total -2,538.48
71. Credit impairment loss
Unit: RMB
Item Incurred in the current period Incurred in the prior period
Bad debt loss from other receivables -527,040.20 -691,163.04
Bad debt loss from accounts receivable -1,237,859.41 2,524,456.58
Total -1,764,899.61 1,833,293.54
72. Asset impairment loss
Unit: RMB
Item Incurred in the current period Incurred in the prior period
II. Impairment Loss of Inventories and
Contract Performance Cost -1,417,159.06 -1,026,689.87
Total -1,417,159.06 -1,026,689.87
73. Return on disposal of assets
Unit: RMB
Source Incurred in the current period Incurred in the prior period
Disposal of fixed assets -919,217.75 -1,085,279.69
Total -919,217.75 -1,085,279.69
74. Non-operating income
Unit: RMB
Amount recognized as
Incurred in the Incurred in the
Item profit or loss of the
current period prior period
current period
144
C&S Paper Co., Ltd. Semi-annual Report 2023
Government grants 10,000.00
Profit from damage and retirement of non-current assets 480,254.78 561.25 480,254.78
Including: Fixed assets 480,254.78 561.25 480,254.78
Income from fine and compensation 1,191,770.08 1,038,029.70 1,191,770.08
Others 1,920,709.80 866,146.19 1,920,709.80
Total 3,592,734.66 1,914,737.14 3,592,734.66
Government grants recognized as profit and loss of the current period:
Unit: RMB
Whether
the grant Amount Amount
Whether a Related to
Nature and affected the incurred in incurred in
Grants Issuer Reason special asset/incom
type profit and the current the last
grant e
loss of the period period
year
Grants
Municipal received
party for the
Party performanc
building
Building e of the
funds for State’s
Work
demonstrati function of
Office of
ve new ensuring Related to
Xiaolan Grant No No 10,000.00
economic the supply income
Town or price
organizatio
Committee, control of a
ns and new
Zhongshan public
social utility or
City
organizatio socially
ns necessary
product
Total 10,000.00
Other description: None
75. Non-operating expenses
Unit: RMB
Amount recognized as profit or
Item Incurred in the current period Incurred in the prior period
loss of the current period
External donations 458,392.14 4,397,406.24 458,392.14
Loss from damage and
retirement of non-current assets 2,521,814.05 1,238,583.11 2,521,814.05
Including: Fixed assets 2,521,814.05 1,238,583.11 2,521,814.05
Others 841,054.03 353,226.14 841,054.03
Total 3,821,260.22 5,989,215.49 3,821,260.22
76. Income tax expenses
(1) Table of income tax expenses
Unit: RMB
Item Incurred in the current period Incurred in the prior period
Current income tax expense 54,135,092.50 57,586,968.04
Deferred income tax expense -55,992,391.59 -23,853,520.58
145
C&S Paper Co., Ltd. Semi-annual Report 2023
Total -1,857,299.09 33,733,447.46
(2) Adjustment process of accounting profits and income tax expenses
Unit: RMB
Item Incurred in the current period
Total profit 82,097,124.17
Income tax expenses calculated at the statutory/applicable tax rate 20,524,281.04
Impacts of different tax rates applied to subsidiaries -23,561,960.88
Impacts of adjustments to income taxes during the prior period -1,322,432.94
Impacts of non-deductible costs, expenses and losses 2,502,813.69
Income tax expenses -1,857,299.09
77. Other comprehensive income
Please refer to the notes for details.
78. Items of the cash flow statement
(1) Cash received related to other operating activities
Unit: RMB
Item Incurred in the current period Incurred in the prior period
Current accounts 34,583,102.62 25,466,487.76
Interest income 16,545,304.21 5,595,579.89
Government grants 3,770,589.53 13,512,699.18
Others 4,486,825.55 4,425,363.57
Authorized collection of individual income tax under the equity
incentive 1,508,300.79 3,109,401.56
Total 60,894,122.70 52,109,531.96
(2) Cash payments related to other operating activities
Unit: RMB
Item Incurred in the current period Incurred in the prior period
Expenses paid 435,245,537.99 451,722,872.22
Current accounts 17,784,310.26 7,036,365.56
Authorized payment of individual income
tax under the equity incentive 7,829,593.69 12,239,910.53
Others 247,818.12 187,497.98
Total 461,107,260.06 471,186,646.29
(3) Cash received related to other investing activities
Unit: RMB
146
C&S Paper Co., Ltd. Semi-annual Report 2023
Item Incurred in the current period Incurred in the prior period
Principal repayment on maturity of large-
70,000,000.00
denomination certificate of deposit
Principal repayment on maturity of
23,001,000.00
treasury bonds reverse repo
Principal repayment on maturity of
41,239,541.68
wealth management products
Total 93,001,000.00 41,239,541.68
(4) Cash payments related to other investing activities
Unit: RMB
Item Incurred in the current period Incurred in the prior period
Purchasing large-denomination Certificate of Deposit 461,000,000.00 140,000,000.00
Purchasing treasury bonds reverse repo 520,600,000.00
Purchasing wealth management products 10,007,000.00
Total 991,607,000.00 140,000,000.00
(5) Cash received related to other financing activities
Unit: RMB
Item Incurred in the current period Incurred in the prior period
Recovery of bills and letter of credit deposits 5,651,225.68
Total 5,651,225.68
(6) Cash payments related to other financing activities
Unit: RMB
Item Incurred in the current period Incurred in the prior period
Cash paid for lease liabilities 5,805,962.59 4,878,971.53
Deposits of security deposits for bills, letters of guarantee and
58,359,813.97
letters of credit
Total 5,805,962.59 63,238,785.50
79. Supplementary information to cash flow statement
(1) Supplementary information to cash flow statement
Unit: RMB
Supplementary information Amount of the current period Amount of last period
1 Reconciliation of net profit to cash
flows from operating activities:
Net Profit 83,954,423.26 227,481,785.93
Plus: Provisions for asset
3,182,058.67 -806,603.67
impairment
Depreciation of fixed assets,
oil and gas assets and productive 197,504,883.83 187,248,981.01
biological assets
Depreciation of use right assets 7,383,463.33 6,768,952.23
Intangible asset amortization 4,773,952.06 3,769,673.22
147
C&S Paper Co., Ltd. Semi-annual Report 2023
Long-term unamortized
4,228,833.02 6,623,087.00
expenses
Losses from disposal of fixed
assets, intangible assets and other long- 919,217.75 1,085,279.69
term assets ("-" indicates income)
Losses from fixed assets write-
2,041,559.27 1,238,021.86
off ("-" indicates income)
Losses from changes in fair
2,538.48
value ("-" indicates income)
Finance expenses ("-" indicates
-11,650,803.43 -10,649,367.10
income)
Investment losses ("-" indicates
-1,958,155.36 -183,493.42
income)
Decrease in deferred income
-36,792,152.59 -23,688,607.42
tax assets ("-" indicates increase)
Increase in deferred income tax
-19,123,874.49 -164,913.16
liabilities ("-" indicates decrease)
Decrease in inventories ("-"
670,487,747.95 273,929,611.30
indicates increase)
Decrease in operating
-129,309,646.18 -99,226,492.95
receivables ("-" indicates increase)
Increase in operating payables
-2,195,249.03 126,121,272.75
("-" indicates decrease)
Others
Net cash flow from operating
773,446,258.06 699,549,725.75
activities
2 Significant investment and financing
activities not involving cash:
Conversion of debt to capital
Convertible corporate bonds due
within one year
Fixed assets acquired under finance
lease
3 Net changes in cash and cash
equivalents:
Balance of cash at the end of the
1,649,920,140.29 1,315,175,165.01
period
Less: Balance of cash at the
1,248,898,024.59 797,797,675.70
beginning of the period
Plus: Balance of cash equivalents at
the end of the period
Less: Balance of cash equivalents at
the beginning of the period
Net increase in cash and cash
401,022,115.70 517,377,489.31
equivalents
(2) Net cash paid to acquire subsidiaries during the period: None
(3) Net cash received from the disposal of subsidiaries during the period: None
(4) Constitution of cash and cash equivalents
Unit: RMB
Item Balance at the end of the period Balance at the beginning of the period
I. Cash 1,649,920,140.29 1,248,898,024.59
Including: Cash on hand 41,732.13 20,309.66
Bank deposits always available for
payment 1,640,753,819.23 1,231,680,951.11
Other monetary funds always 9,124,588.93 17,196,763.82
148
C&S Paper Co., Ltd. Semi-annual Report 2023
available for payment
III. Balance of Cash and Cash Equivalents at
the End of the Period 1,649,920,140.29 1,248,898,024.59
80. Notes to items in the statement of changes in owner’s equity: None
81. Assets with restricted right to use or ownership
Unit: RMB
Item Book value at the end of the period Reason for restriction
Other monetary funds 70,238,291.22 Security deposits for issuing letter of credit and notes
Total 70,238,291.22 --
82. Foreign currency monetary items
(1) Foreign currency monetary items
Unit: RMB
Balance of foreign currency at Balance of converted RMB at
Item Conversion rate
the end of the period the end of the period
Monetary funds 623,548,852.01
Including: USD 84,986,255.46 7.2754 618,309,002.97
EUR
HKD 5,644,467.28 0.9283 5,239,758.98
Mop 100.00 0.9006 90.06
Accounts receivable 50,444,122.10
Including: USD 3,348,035.75 7.2754 24,358,299.30
EUR
HKD 28,100,638.59 0.9283 26,085,822.80
Long-term borrowings
Including: USD
EUR
HKD
Other receivables 167,361.26
Including: HKD 180,287.90 0.9283 167,361.26
Accounts payable 331,517,765.33
Including: USD 45,566,946.88 7.2754 331,517,765.33
Other payables 3,970,792.71
Including: HKD 4,277,488.65 0.9283 3,970,792.71
(2) For overseas business entities, especially important ones, disclose their main overseas business address,
the standard currency for accounting and selection basis. If there are changes in the standard currency for
accounting, reasons shall be also provided.
√ Applicable □ Not applicable
149
C&S Paper Co., Ltd. Semi-annual Report 2023
Overseas business entity Business address Standard currency for accounting
Zhong Shun International Co., Ltd. Hong Kong RMB
C&S Hong Kong Co., Ltd. Hong Kong RMB
C&S (Macao) Co., Ltd. Macao RMB
83. Hedges: None
84. Government grants
(1) Basic information on government grants
Unit: RMB
Amount recognized as profit or
Category Amount Reporting items
loss for the current period
Related to income 3,931,439.53 Other income 3,931,439.53
Total 3,931,439.53 3,931,439.53
(2) Return of government grants
□ Applicable √ Not applicable
Other description:
Please refer to Note VII (51), (67) and (74) for details.
85. Others: None
VIII. Changes in the Consolidated Scope
1. Business combinations of enterprises not under common control
(1) Business combinations of enterprises not under common control in the reporting period
Unit: RMB
Revenue of Net profit of
the acquiree the acquiree
Basis for
Equity from the from the
Equity Equity Proportion determini
Name of acquisit Acquisition acquisition acquisition
acquisition acquisition of acquired ng the
acquiree ion date date to the date to the end
time cost equity acquisitio
method end of the of the
n date
reporting reporting
period period
Quxian
Constitute
Jiezhu
substantiv
Constructio March 17, 5,810,000.0 Acquisi March 17,
100.00% e control -116,381.94
n and 2023 0 tion 2023
over the
Developme
acquiree
nt Co., Ltd.
Other descriptions:
150
C&S Paper Co., Ltd. Semi-annual Report 2023
C&S (Dazhou) Paper Co., Ltd., a subsidiary of C&S Paper Co., Ltd., used its own funds and acquired 100% of
Quxian Jiezhu Construction and Development Co., Ltd. through the auction of Quxian Public Resource Exchange
Service Center, with a strike price of RMB5,810,000.00.
(2) Combination costs and goodwill
Unit: RMB
Combination cost
--Cash 5,810,000.00
-- Fair value of non-cash assets
-- Fair value of debts assumed or issued
-- Fair value of equity securities issued
-- Fair value of contingent consideration
-- Fair value of equities held before the acquisition date on the
acquisition date
--Others
Total combination cost 5,810,000.00
Less: Fair value of identifiable net assets acquired 5,176,863.66
Difference between the goodwill/combination cost and the fair
633,136.34
value of identifiable net assets acquired
Method of determining the fair value of combination costs and descriptions of contingent consideration and its changes: None
Main reasons for the formation of huge goodwill: None
(3) Acquiree’s identifiable assets and liabilities on the acquisition date
Method for determining the fair value of identifiable assets and liabilities:
According to the appraisal report "Sichuan Tianyuan Appraisal Report [2022] No. 012" issued by the asset appraisal
agency engaged by Quxian Zunxian Human Resources Development Co., Ltd., the fair value of the acquiree on the
appraisal base date is estimated to be RMB5,176,863.66 by the cost method.
Acquiree's contingent liabilities assumed in the business combination: None
(4) Profit or loss arising from the recalculation based on fair value of equities held before the acquisition date
Whether there are transactions through which business combination is achieved in stages while control is obtained within the
reporting period
□ Yes √ No
151
C&S Paper Co., Ltd. Semi-annual Report 2023
(5) Descriptions of being unable to determine the consideration or the fair value of acquiree’s identifiable
assets and liabilities on the acquisition date or at the end of the current period of combination: None
(6) Other description: None
2. Business combinations of enterprises under common control
(1) Business combinations of enterprises under common control in the current period: None
(2) Combination costs: None
(3) Book value of assets and liabilities of the combined party on the date of combination: None
3. Reverse purchase: None
4. Disposal of subsidiaries
Whether there is situation that one disposal of investment in a subsidiary results in a loss of control
□ Yes √ No
Whether there is situation that the disposal of investment in a subsidiary is achieved in stages through multiple
transactions while the control is lost in the reporting period
□ Yes √ No
5. Changes in the scope of consolidation due to other reasons
Description of changes in the scope of combination due to other reasons (establishment or liquidation of
subsidiaries, etc.) and related situations:
In February 2023, the subsidiary C&S (Dazhou) Paper Co., Ltd. acquired 100% equities of Quxian Jiezhu
Construction and Development Co., Ltd. In March 2023, Quxian Jiezhu Construction and Development Co., Ltd.
completed the change registration with the industrial and commercial department, with a registered capital of
RMB10 million after the change. The Company has incorporated Quxian Jiezhu Construction and Development
Co., Ltd. into the scope of its consolidated statements since March 2023. Currently, Quxian Jiezhu has not started
operating activities.
Zhongshun Healthy Life Technology (Shenzhen) Co., Ltd. was dissolved and canceled in April 2023, and the
Company no longer incorporated it into the scope of consolidated statements from the date of cancellation.
Zhongshun Healthy Life Technology (Shenzhen) Co., Ltd. was established under the joint investment of the
Company and its wholly-owned subsidiary Zhongshan Zhongshun Trading Co., Ltd. in May 2022, with a registered
capital of RM10 million. The Company held 60% of the shares while Zhongshan Zhongshun Trading held 40% of
the shares.
In June 2023, the Company used its own funds and established a wholly-owned subsidiary Guangdong Laotongxue
Information Technology Co., Ltd. in Zhongshan City, Guangdong Province, with a registered capital of RMB5
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C&S Paper Co., Ltd. Semi-annual Report 2023
million. The Company has incorporated Guangdong Laotongxue Information Technology Co., Ltd. into the scope
of its consolidated statements since June 2023. Currently, Guangdong Laotongxue has not started operating
activities.
6. Others: None
IX. Equities in Other Entities
1. Equities in subsidiaries
(1) Composition of the enterprise group
Main Shareholding
Name of Registered Obtaining
business Principal businesses percentage
subsidiary address method
address Direct Indirect
R&D, production, and sales (including online sales):
household paper, maternal and infant products,
cosmetics, wipes, non-woven products, daily
necessities, and cleaning supplies; sales (including Capital
Jiangmen
Jiangmen, Jiangmen, online sales) of Class I and II medical devices. (The contribution
Zhongshun 88.25% 11.75%
Guangdong Guangdong above items do not involve special management for
Paper Co., Ltd.
measures for the foreign access). (For items that must establishment
be approved in accordance with the law, the company
may carry out business operations upon approval by
competent departments.)
General items: manufacture of paper products; sales
of paper products; sales of paper pulp; sales of
personal hygiene products; sales of hygiene products
and disposable medical products; sales of
disinfectants (excluding hazardous chemicals); sales
of Class I medical devices; retail of Class I medical
devices; sales of Class II medical devices; retail of
class II medical devices; wholesale of medical face
masks; retail of medical face masks; sales of general
merchandise; retail of daily necessities; sales of
maternal and infant products; wholesale of
Capital
Zhejiang kitchenware, sanitary ware and daily sundries;
Jiaxing, Jiaxing, contribution
Zhongshun wholesale of cosmetics; retail of cosmetics; wholesale 75.00% 25.00%
Zhejiang Zhejiang for
Paper Co., Ltd. of needle textiles and raw materials; sales of needle
establishment
textiles; sales of chemical industry products
(excluding chemical products that need to be
licensed); Internet sales (excluding the sales of
commodities requiring a permit) (The company may
carry out business operations independently
according to the law based on the business license,
except for items that must be licensed according to
the law.) (For items that must be approved in
accordance with the law, the company may carry out
business operations upon approval by competent
departments.)
Capital
C&S Hong contribution
Hong Kong Hong Kong Purchase of pulp 100.00%
Kong Co., Ltd. for
establishment
R&D, production, wholesale, retail and online sales:
Capital
household paper, sanitary products, maternal and
C&S (Yunfu) Yunfu, Yunfu, contribution
infant products, daily necessities, cosmetics, medical 100.00%
Paper Co., Ltd. Guangdong Guangdong for
devices, sanitary materials, non-woven fabrics and
establishment
products, polymer materials and products, daily
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C&S Paper Co., Ltd. Semi-annual Report 2023
sundries, and disinfectant products (excluding
hazardous chemicals); wholesale, retail and online
sales: food; import and export of goods and
technologies (excluding the import and export of
goods and technologies prohibited by the State or
involving administrative approval); warehousing
services (limited to warehouses qualified in fire
protection without hazardous chemicals). (For items
that must be approved in accordance with the law, the
company may carry out business operations upon
approval by competent departments.)
Wholesale, retain and online sales: paper, wood pulp,
sanitary products, maternal and infant products,
cosmetics, daily necessities, medical equipment, daily
sundries, disinfection supplies (excluding dangerous
Capital
Yunfu Hengtai chemicals); import and export of goods or
Yunfu, Yunfu, contribution
Trading Co., technologies (excluding the import and export of 100.00%
Guangdong Guangdong for
Ltd. goods and technologies prohibited by the State or
establishment
involving administrative approval). (For items that
must be approved in accordance with the law, the
company may carry out business operations upon
approval by competent departments.)
Capital
C&S (Macao) contribution
Macao Macao Wholesale, trade 100.00%
Co., Ltd. for
establishment
Wholesale, retail and online sales (sales only on
third-party platforms) of paper supplies, paper
products (excluding printing products), wood pulp,
general merchandise, hygiene products, cosmetics,
nonwoven products, chemical products for daily use,
Class I medical devices and food; warehousing
(excluding hazardous chemicals and precursor Business
chemicals); import and export of goods and combinations
Zhongshan
technologies; operations of Class II and Class III involving
Zhongshun Zhongshan, Zhongshan,
medical devices. (The above business scope involves 100.00% enterprises
Trading Co., Guangdong Guangdong
food operations, import and export of goods, and under
Ltd.
import and export of technologies.) (Exclude items common
prohibited by laws and administrative regulations; control
items whose operations are restricted by laws and
administrative regulations shall not be carried out
unless the permit has been obtained.) (For items that
must be approved in accordance with the law, the
company may carry out business operations upon
approval by competent departments.)
Import, export and sales of paper products, general Business
merchandise and pulp boards; sales of cosmetics, combinations
Xiaogan C&S shower gel and sanitary pads; sales of baby products involving
Xiaogan, Xiaogan,
Trading Co., (excluding food). (For items that must be approved in 100.00% enterprises
Hubei Hubei
Ltd. accordance with the law, the company may carry out under
business operations upon approval by competent common
departments.) control
Sales of paper products, daily necessities, paper pulp,
and pulp boards; import and export of goods. (The
company may independently select business items Business
and carry out business activities in accordance with combinations
the law; for items that must be approved in involving
Beijing C&S
Beijing Beijing accordance with the law, the company may carry out 100.00% enterprises
Paper Co., Ltd.
business operations upon approval by competent under
departments based on contents of the approval; it is common
prohibited to engage in business activities of items control
prohibited and restricted by the city’s industrial
policies.)
Chengdu Pengzhou, Pengzhou, Sales of household paper, cleaning products, general Business
100.00%
Zhongshun Sichuan Sichuan merchandise, hygiene products, baby products, combinations
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C&S Paper Co., Ltd. Semi-annual Report 2023
Paper Co., Ltd. cosmetics, nonwoven products, feminine hygiene involving
products, chemical products for daily use, daily enterprises
necessities, medical devices, medical supplies and under
disinfectant products (excluding hazardous common
chemicals); e-commerce [For items that must be control
approved in accordance with the law, the company
may carry out business operations upon approval by
competent departments.]
Wholesale, retail: paper products, paper pulp, general
merchandise; import and export of goods and
technologies (exclude items prohibited by laws and Business
administrative regulations; items whose operations combinations
Hangzhou Jie are restricted by laws and administrative regulations involving
Hangzhou, Hangzhou,
Rou Trading shall not be carried out unless the permit has been 100.00% enterprises
Zhejiang Zhejiang
Co., Ltd. obtained); other legitimate items that do not need under
approval according to the law) (for items that must be common
approved in accordance with the law, the company control
may carry out business operations upon approval by
competent departments)
Business
Household paper, paper pulp, pulp boards, import and combinations
Shanghai export of goods and technologies. (For items that involving
Huicong Paper Shanghai Shanghai must be approved in accordance with the law, the 100.00% enterprises
Co., Ltd. company may carry out business operations upon under
approval by competent departments.) common
control
General items: manufacture of paper; manufacture of
paper products; sales of paper products; sales of
sanitary products and disposable medical supplies;
retail of cosmetics; wholesale of cosmetics; sales of
personal hygiene products; sales of knitwear;
manufacture of maternal and infant products; sales of
maternal and infant products; sales of daily
necessities; sales of daily chemical products; sales of
disinfectants (excluding hazardous chemicals); sales
of Class I medical devices; sales of Class II medical
devices; export of goods; export of technologies; Business
Internet sales (excluding the sales of commodities combinations
requiring a permit); information technology involving
C&S (Hubei) Xiaogan, Xiaogan,
consulting services (The company may carry out 93.375% 6.625% enterprises
Paper Co., Ltd. Hubei Hubei
business operations independently according to the under
law based on the business license, except for items common
that must be licensed according to the law.) Licensed control
items: production of cosmetics; production of sanitary
products and disposable medical supplies(for items
that must be approved in accordance with the law,
companies may carry out business operations upon
approval by relevant departments, and the specific
business items are subject to the approval document
or the permit issued by competent department).( The
above business activities do not involve prohibited
items in the Negative list of foreign investment in
China)
Business
combinations
Zhong Shun involving
Hong Kong, Hong Kong,
International Sales of paper products 100.00% enterprises
China China
Co., Ltd. under
common
control
Licensed items: production of sanitary products and Business
disposable medical supplies; import and export of combinations
C&S (Sichuan) Pengzhou, Pengzhou,
goods (for items that must be approved in accordance 100.00% involving
Paper Co., Ltd. Sichuan Sichuan
with the law, the company may carry out business enterprises
operations upon approval by competent departments, under
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C&S Paper Co., Ltd. Semi-annual Report 2023
and the specific business items are subject to the common
approval document or the permit issued by relevant control
department). General items: sales of sanitary products
and disposable medical supplies; sales of personal
hygiene products; sales of daily necessities;
manufacture of paper products; sales of paper
products; manufacture of paper; manufacture of daily
chemical products; sales of daily chemical products;
sales of Class II medical devices; sales of Class I
medical devices; manufacture of industrial textile
products; sales of industrial textile products;
manufacture of maternal and infant products; sales of
maternal and infant products. (The company may
carry out business operations independently
according to the law based on the business license,
except for items that must be licensed according to
the law.)
Production, processing and sales: high-class
household paper products (excluding printing
Business
process); import and export of pulp boards (exclude
combinations
items prohibited by laws and administrative
C&S involving
Zhongshan, Zhongshan, regulations; items whose operations are restricted by
(Zhongshan) 100.00% enterprises
Guangdong Guangdong laws and administrative regulations shall not be
Paper Co., Ltd. under
carried out unless the permit has been obtained). (For
common
items that must be approved in accordance with the
control
law, the company may carry out business operations
upon approval by competent departments.)
R&D, production, processing, and sales (including
online sales): household paper, tissue boxes, hygiene
products, cosmetics, non-woven products, plastic
products, metalware, rubber products, ceramics, baby
products, feminine hygiene products and daily
necessities; bamboo and forest trees planting;
acquisition of raw materials of bamboo and wood for
paper making; R&D, production and sales of bamboo
Capital
pulp, wood pulp, bamboo chips and wood chips;
C&S (Dazhou) Dazhou, Dazhou, contribution
combined heat and power and sales; warehouse 100.00%
Paper Co., Ltd. Sichuan Sichuan for
leasing; processing and sales of lime and limestone;
establishment
processing of industrial wastewater and gray water
reuse; general import and export business; sales of
construction materials, hardware and electrical
products, and chemical products (excluding
hazardous products). (For items that must be
approved in accordance with the law, the company
may carry out business operations upon approval by
competent departments.)
R&D, production, processing, and online sales: paper
products, hygiene products, cosmetics, nonwoven
products, plastic products for daily use, chemical
products for daily use, metalware for daily use,
rubber products for daily use, and ceramics for daily Capital
Sun Daily
Yunfu, Yunfu, use; import and export of goods or technologies contribution
Necessities Co., 50.00% 50.00%
Guangdong Guangdong (excluding the import and export of goods and for
Ltd.
technologies prohibited by the State or involving establishment
administrative approval). (For items that must be
approved in accordance with the law, the company
may carry out business operations upon approval by
competent departments.)
General items: manufacture of paper products;
Internet sales (sales only on third-party platforms)
(excluding the sales of commodities requiring a Capital
Dolemi Sanitary
Zhongshan, Zhongshan, permit); sales of personal hygiene products; sales of contribution
Products Co., 60.00% 40.00%
Guangdong Guangdong household products, sales of hygiene products and for
Ltd.
disposable medical products; retail of cosmetics; sales establishment
of general merchandise; sales of plastic products;
sales of metal products; sales of rubber products;
156
C&S Paper Co., Ltd. Semi-annual Report 2023
manufacture of daily-use ceramic products. (The
company may carry out business operations
independently according to the law based on the
business license, except for items that must be
licensed according to the law.) (For items that must
be approved in accordance with the law, the company
may carry out business operations upon approval by
competent departments.)
Licensed items: manufacture of Class II medical
devices; import and export of goods; import and
export of technologies; manufacture of Class III
medical devices; operation of Class III medical
devices (for items that must be approved in
accordance with the law, companies may carry out
business operations upon approval by relevant
departments, and the specific business items are
subject to approval result). General items:
manufacture of paper products; sales of plastic
products; sales of paper products; Internet sales
(excluding the sales of commodities requiring a
permit); sales of daily necessities; sales of personal
Capital
hygiene products; sales of household products; sales
C&S (Jiangsu) Suqian, Suqian, contribution
of sanitary products and disposable medical products; 100.00%
Paper Co., Ltd. Jiangsu Jiangsu for
retail of cosmetics; wholesale of cosmetics; sales of
establishment
knitwear; wholesale of kitchen utensils and daily
groceries; sales of metal products; sales of rubber
products; manufacture of daily-sue ceramic products;
R&D of kitchen utensils and daily groceries; retail of
kitchen utensils and daily groceries; sewage treatment
and recycling; manufacture of Class I medical
devices; sales of Class I medical devices; sales of
Class II medical devices; sales of disinfectants
(excluding hazardous chemicals). (The company may
carry out business operations independently
according to the law based on the business license,
except for items that must be licensed according to
the law)
Technology development, technology consultation,
technology transfer, technology promotion, and
technical services; sales of paper products, daily
necessities, hygiene products, cosmetics, chemical
products (excluding hazardous chemicals), Class I
medical devices, Class II medical devices,
Beijing
disinfection products and non-medical masks. (The Capital
Bloomage
market entity may independently select business contribution
Jierou Beijing Beijing 51.00%
items and carry out business activities in accordance for
Biotechnology
with the law; for items that must be approved in establishment
Co., Ltd.
accordance with the law, the company may carry out
business operations upon approval by competent
departments based on contents of the approval; it is
prohibited to engage in business activities of items
prohibited and restricted by national and municipal
industrial policies.)
General items: sales of personal hygiene products;
sales of household products; sales of sanitary
products and disposable medical products; retail of
Zhengzhou cosmetics; sales of daily necessities; sales of plastic Capital
Dolemi Sanitary Zhengzhou, Zhengzhou, products; sales of paper products; sales of metal contribution
60.00%
Products Co., Henan Henan products; sales of rubber products; manufacture of for
Ltd. daily-use ceramic products (the company may carry establishment
out business operations independently according to
the law based on the business license, except for
items that must be licensed according to the law).
Xi’an Dolemi General items: sales of daily necessities; retail of Capital
Xi’an, Xi’an,
Sanitary cosmetics; sales of household goods; sales of office 60.00% contribution
Shaanxi Shaanxi
Products Co., supplies; sales of arts and crafts and etiquette for
157
C&S Paper Co., Ltd. Semi-annual Report 2023
Ltd. products (except ivory and its products); sales of establishment
building decoration materials; sales of knitwear; sales
of machinery and equipment; sales of instruments and
meters; retail of clothes and apparels; retail of shoes
and hats; sales of foods (only pre-packaged foods);
sales of sundries; sales of electronic products;
landscaping engineering construction; advertising
design and agency; network technology services;
marketing planning; convention and exhibition
services; etiquette services. (The company may carry
out business operations independently according to
the law based on the business license, except for
items that must be licensed according to the law)
Technology services, development, consultation,
Guangdong exchange, transfer, and promotion; paper
manufacturing; paper product manufacturing; paper Capital
Huashun
Jiagnmen Jiagnmen contribution
Material product sales. (For items that must be approved in 51%
Guangdong Guangdong for
Technology Co., accordance with the law, the company may carry out establishment
Ltd business operations upon approval by competent
departments.)
Licensed items: engineering construction; tap water
production and supply. (For items that must be
approved in accordance with the law, companies may
carry out business operations upon approval by
relevant departments, and the specific business items Business
are subject to the approval document or the permit combinations
Quxian Jiezhu
involving
Construction Dazhou Dazhou issued by competent department) General items:
100% enterprises
Development Sichuan Sichuan sewage treatment and recycling; heat production and under
Co., Ltd supply; solid waste treatment; paper product common
manufacturing; paper product sales. (The company control
may carry out business operations independently
according to the law based on the business license,
except for items that must be licensed according to
the law)
General items: technical services, technology
development, technical consultation, technical
exchange, technology transfer, technology promotion;
educational consulting services (excluding
educational and training activities that need to be
licensed); organization of cultural and artistic
exchange activities; fitness and leisure activities;
institutional nursing services (excluding medical
services); health consultation services (excluding
diagnosis and treatment services); elderly care
Guangdong services; healthcare services (non-medical); Capital
Laotongxue
Zhongshan Zhongshan traditional Chinese medicine healthcare services contribution
Information 100%
Guangdong Guangdong (non-medical); sales of health food (prepackaged); for
Technology Co.,
retail of household appliances; sales of sundries for establishment
Ltd
daily use; sales of spare parts of household
appliances; sales of household items; sales of paper
products; sales of Class I medical devices; sales of
Class II medical devices. (The company may carry
out business operations independently according to
the law based on the business license, except for
items that must be licensed according to the law.)
Licensed items: operation of Class III medical
devices. (For items that must be approved in
accordance with the law, companies may carry out
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C&S Paper Co., Ltd. Semi-annual Report 2023
business operations upon approval by relevant
departments, and the specific business items are
subject to the approval document or the permit issued
by competent department)
Description of the difference between the percentage of shares held in a subsidiary and the percentage of voting rights: None
Basis for holding 50% or less than of the voting rights but controlling the investee, or holding 50% or more of the voting rights but
not controlling the investee: None
Basis for controlling the important consolidated structured entities: None
Basis for determining whether the Company is an agent or a principal: None
Other descriptions: All shares held indirectly belong to the shares held by wholly-owned subsidiaries of the Company
(2) Important non-wholly-owned subsidiaries: None
The Company does not have important non-wholly-owned subsidiaries.
(3) Main financial information of important non-wholly-owned subsidiaries: None
(4) Significant restrictions on the use of the assets and the repayment of the debts of the enterprise group:
None
(5) Financial or other support provided to consolidated structured entities: None
2. Transactions in which the share of owner’s equity in a subsidiary change while control of the subsidiary is
still retained
(1) Description of changes in the share of owner’s equity in the subsidiary: None
(2) Impact of the transaction on the equity of minority shareholders and the equity attributable to owners of
the Parent Company: None
There are no transactions of the Company in which the share of owner’s equity in a subsidiary changes and
control of the subsidiary is retained.
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C&S Paper Co., Ltd. Semi-annual Report 2023
3. Interests in joint arrangements or associates
(1) Important joint ventures or associates: None
(2) Main financial information of important joint ventures: None
(3) Main financial information of important associates: None
(4) Summary financial information of unimportant joint ventures and associates: None
(5) Description of significant restrictions on the ability of joint ventures or associates to transfer funds to the
Company: None
(6) Excess losses incurred by joint ventures or associates: None
(7) Unconfirmed commitments related to the investment in joint ventures: None
(8) Contingent liabilities related to the investment in joint ventures or associates: None
4. Important joint operation: None
The Company does not have important joint operations.
5. Interests in unconsolidated structured entities: None
The Company does not have interests in unconsolidated structured entities.
6. Others: None
X. Risks Associated with Financial Instruments
The main financial instruments of the Company include monetary funds, notes receivable, accounts receivable,
notes payable, accounts payable, other payables, loans, etc. Please refer to relevant items of "Note VII" for detailed
information of all financial instruments. The risks associated with these financial instruments and the risk
management policies adopted by the Company to reduce these risks are as follows. The management of the
Company manages and monitors these risk exposures to ensure that the above risks are kept within control.
The Company adopts the sensitivity analysis method to analyze the possible impact of reasonable and possible
changes in risk variables on the profit and loss or shareholder equities in the current period. Since any risk variable
rarely changes in isolation and the correlation between the variables will have a significant effect on the ultimate
financial impact of changes in a certain risk variable, the following contents are under the consumption that changes
of a variable are independent.
The goal of the Company’s risk management is to strike a proper balance between risks and gains and to minimize
the negative impact of risks on the business performance of the Company while maximizing the interests of
shareholders and other equity investors. Based on this risk management goal, the basic strategy of the Company’s
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C&S Paper Co., Ltd. Semi-annual Report 2023
risk management is to determine and analyze all kinds of risks faced by the Company, clarify the minimum of risk
acceptance and conduct risk management, and monitor risks of all kinds in a timely and reliable manner to control
risks within the limits.
1. Credit risk
Credit risk refers to the risk of financial losses of one party caused by the failure of the other party to perform its
obligations. As of June 30, 2023, the largest credit exposure that may cause financial losses to the Company mainly
comes from the losses of the Company’s financial assets due to failure of the other contractual party to perform its
obligations.
In order to reduce credit risk, the Company only conducts transactions with recognized customers with good credit
status, and continuously monitors the accounts receivable through credit monitoring of existing customers and aging
analysis to ensure that the Company does not face the risk of bad debts and keep the overall credit risk within control.
Liquid funds of the Company are deposited in banks with high credit ratings, so the credit risk of liquid funds is
low.
2. Interest rate risk
Interest rate risk refers to the risk of fluctuations in the fair value or future cash flow of financial instruments due to
changes in market interest rates. The interest rate risk faced by the Company mainly comes from bank borrowings.
By developing a good relationship with banks and carrying out proper design of credit lines, types of credits, and
credit terms, the Company ensures sufficient bank credit lines to meet its various financing needs. The risk of interest
rate fluctuation can be reasonably reduced by shortening the term of a single loan and specially stipulating early
prepayment terms.
3. Foreign exchange risk
Foreign exchange risk refers to the risk of fluctuations in the fair value or future cash flow of financial instruments
due to changes in foreign exchange rates. The Company tries its best to match foreign currency income with foreign
currency expenditure to reduce foreign exchange risks.
Foreign exchange risks borne by the Company are mainly related to USD and HKD. Except for purchasing and
selling in USD and HKD by its overseas subsidiaries, other major business activities of the Company are priced and
settled in RMB. See "Note VII (82)" for the conversion of foreign currency financial assets and liabilities into RMB
as of June 30, 2023. During the reporting period, the Company generated exchange profit and loss of RMB
-18,928,998.16.
Sensitivity analysis of foreign exchange risk:
Analysis assumption: On the basis that all other variables remain constant on the balance sheet date, the possible,
reasonable changes of foreign exchange rate will have the following pre-tax effects on the Company’s profit and
loss and shareholders’ equity in the current period:
Unit：RMB
End of year
Item Impact on shareholders’
Impact on profit
equity
Appreciation of RMB against foreign currency by 1.00% -3,386,717.77 -3,386,717.77
Depreciation of RMB against foreign currency by 1.00% 3,386,717.77 3,386,717.77
4. Liquidity risk
Liquidity risk refers to the risk of capital shortage when an enterprise fulfills its obligation to settle accounts by
delivering cash or other financial assets. The Company’s policy is to ensure that it has sufficient cash to repay
mature debts. Liquidity risk is centrally controlled by the financial departments of the Company. The financial
departments monitor cash balances, negotiable securities that can be cashed in at any time, and carry out rolling
161
C&S Paper Co., Ltd. Semi-annual Report 2023
forecasts on cash flows in the next six months to ensure that the Company has sufficient funds to repay debts under
all reasonable forecasts.
Financial liabilities held by the Company as of June 30, 2023 analyzed based on the maturity period of undiscounted
remaining contractual obligations are as follows:
Unit：RMB
Item Within 1 year Over 1 year Total
Notes payable 326,437,678.21 326,437,678.21
Accounts payable 807,906,958.92 1,938,383.78 809,845,342.70
Other payables 946,901,905.18 3,413,268.53 950,315,173.71
Non-current liabilities due within one year 8,708,819.36 8,708,819.36
Lease liabilities 8,675,066.94 8,675,066.94
Total 2,089,955,361.67 14,026,719.25 2,103,982,080.92
XI. Disclosure of Fair Value
1. Fair value of assets and liabilities measured at fair value at the end of the reporting period: None
2. Basis for determining the market price of recurring and non-recurring fair value measurement items in
Level 1: None
3. Qualitative and quantitative information on important parameters and valuation techniques used for
recurring and non-recurring fair value measurement items in Level 2: None
4. Qualitative and quantitative information on important parameters and valuation techniques used for
recurring and non-recurring fair value measurement items in Level 3: None
5. Adjustment information and sensitivity analysis of unobservable parameters between the opening and
closing book values of recurring fair value measurement items of Level 3: None
6. For recurring fair value measurement items with transfer between different levels, reasons for such
transfer and policies for determining the time of conversion: None
7. Changes in valuation techniques within the reporting period and reasons for such changes: None
8. Fair value of financial assets and financial liabilities not measured at fair value: None
9. Others: None
XII. Related Parties and Related Party Transactions
1. Information on the Parent Company of the Company
Shareholding
Percentage of
percentage of
Name of Parent Registered Registered voting right of the
Principal businesses the Parent
Company address capital Parent Company to
Company to the
the Company
Company
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C&S Paper Co., Ltd. Semi-annual Report 2023
External investment; consulting of
Guangdong information on commodities
Zhongshan, RMB30
Zhongshun Paper circulation (exclusive of real estate, 28.60% 28.60%
Guangdong million
Group Co., Ltd. labor services, financial futures, and
studying abroad)
Information on the Company’s Parent Company
The ultimate controller of the Company is Mr. Deng Yingzhong, the father, and Mr. Deng Guanbiao and Mr. Deng Guanjie, whose
two sons.
2. Information on subsidiaries of the Company
See Note IX Equities in Other Entities for detailed information on the subsidiaries of the Company.
3. Information on the joint ventures and associates of the Company
For important joint ventures or associates, please refer to the notes for details.
Other description
The Company does not have interests in joint venture arrangements or associates.
4. Information on other related parties
Name of other related parties Relationship between other related parties and the Company
A company controlled by the Company’s actual controller/other shareholder
Chung Shun Co.
holding 5% or more of shares
A company controlled by the nephew and the husband of the niece of Mr. Deng
Guangzhou Zhongshun Trade Co., Ltd.
Yingzhong, the Company’s actual controller Mr. Deng Yingzhong
A company in which the Company’s actual controller Mr. Deng Yingzhong
Bama Zhongshun Health Products Co., Ltd.
serves as a director
A company controlled by the Company’s controlling shareholders in the past 12
Yantai Zhongshun Network Technology Co., Ltd.
months
A company jointly controlled by the Company’s actual controllers Mr. Deng
Shenzhen Zhongshun Caizhi Investment Co., Ltd.
Yingzhong, Mr. Deng Guanbiao and Mr. Deng Guanjie
A company in which the son of the Company’s Vice President Yue Yong holds
Pengzhou Enjoying Life Trading Co., Ltd.
50% equity
A company where the son of the Company’s Vice President Yue Yong holds
Sichuan West Enjoying Life Trading Co., Ltd.
50% equity
Chongqing Qinyue Trading Co., Ltd. A company in which the spouse of the brother of the Company’s Vice President
(Former: Chongqing Fuling District Qinyue Yue Yong controls and serves as the executive director, manager, and legal
Household Necessities Co., Ltd.) representative of the company
A company in which the Company’s actual controller Mr. Deng Guanbiao
Shenzhen Jinju Investment Co., Ltd.
serves as a director
A company in which the Company’s actual controller Mr. Deng Guanjie serves
Zhongshan Zhongshun Caizhi Trading Co., Ltd.
as the manager and executive director
Zhongshan Qianlai Network Technology Co., Ltd. A company controlled by the Company’s independent director Mr. Liu Die
Foshan Yingfang Jiayu Consulting Services Co., A company controlled by the Company’s supervisor Liang Yongliang and serves
Ltd. as the executive director, manager, and legal representative of the company
A company where the brother of Deng Yingzhong, an actual controller of the
Foshan Shunde District Taogang Trading Co., Ltd
company, holds 50% of the shares and serves as the legal representative
A company in which the mother-in-law of the Company’s actual controller Mr.
Meizhou Xinhong Electronics Co., Ltd. Deng Guanbiao serves as the General Manager, executive director and the legal
representative
A company in which the sibling-in-laws of the Company’s supervisor Zhang
Guangzhou Chenhui Paper Co., Ltd.
Gao act as the legal representative
A company in which the sibling-in-laws of the Company’s supervisor Zhang
Guangzhou Jiahui Enterprise Management Co.,
Gao controls and acts as the legal representative while Mr. Zhang’s spouse
Ltd.
serves as the executive director
163
C&S Paper Co., Ltd. Semi-annual Report 2023
A company in which the sibling-in-laws of the Company’s supervisor Zhang
China Paper Investment Co., Ltd.
Gao serve as directors in the past 12 months
A company in which the sibling-in-laws of the Company’s supervisor Zhang
Zhejiang FTZ Xinjiachang Trading Co., Ltd.
Gao acts as directors
Zhuhai High-tech Zone Shengda Engineering A company in which the son of the Company’s CFO Dong Ye serves as the legal
Consulting Service Center representative
A company in which the Company’s Board Secretary and Vice President serves
Zhongshan Jufengbao Trading Co., Ltd.
as the executive director, manager and legal representative
Guangdong Huichuang Zhiyuan Enterprise A company controlled by Chairman Liu Peng and served as the legal
Management Co., Ltd representative, manager, and executive director of the company
A company controlled by Vice President Lin Tiande and served as the legal
Jiangmen Yutongda Trading Co., Ltd
representative and executive director
A company in which the Company’s director Yu Ep. Rachel Jing acts as
Yingtan Dongwu Technology Co., Ltd
Chairman
Other description
Note: The Company’s directors, supervisors, senior managers and their close family members are related parties of
the Company.
5. Information on related party transactions
(1) Related party transactions for purchase and sale of goods, and provision and acceptance of labor services
Purchase of goods/acceptance of labor services：None
Table of sale of goods/provision of labor services
Unit: RMB
Content of related party
Related party Incurred in the current period Incurred in the prior period
transaction
Pengzhou Enjoying Life
Sale of goods 8,288.50
Trading Co., Ltd.
Sichuan West Enjoying Life
Sale of goods 111.50
Trading Co., Ltd.
Explanation of the related party transactions for purchase and sale of goods, and provision and acceptance of labor services：None
(2) Related entrusted management/contracting and entrusting management/contracting out: None
(3) Related lease
The Company as the lessor: None
The Company as the lessee:
Unit: RMB
Rental costs for Variable lease
simplified short- payments not
term leases and included in the Interest expense of Increased use right
Name Type of low value asset measurement of Rent paid lease liabilities assets
of leased leases (if lease liabilities (if undertaken
lessor assets applicable) applicable)
Incurre Incurre Incurre Incurre Incurre Incurre Incurre Incurre Incurre Incurre
d in the d in the d in the d in the d in the d in the d in the d in the d in the d in the
current prior current prior current prior current prior current prior
period period period period period period period period period period
Mr. Housin 1,400,3 1,473,9 61,859. 136,797 1,029,6
Deng g lease 23.75 25.82 28 .37 07.91
164
C&S Paper Co., Ltd. Semi-annual Report 2023
Yingzh
ong,
Mr.
Deng
Guanbi
ao and
Mr.
Deng
Guanjie
Explanation of related lease: None
(4) Related guarantee: None
(5) Interbank borrowing between related parties: None
(6) Asset transfer and debt reorganization between related parties: None
(7) Remuneration for key managers
Unit: RMB
Item Incurred in the current period Incurred in the prior period
Remuneration for key managers 9,939,572.23 13,310,774.14
(8) Other related party transactions
6. Receivables from and payables to related parties
(1) Receivables：None
(2) Payables
Unit: RMB
Book balance at the end of the Book balance at the
Project Related party
period beginning of the period
Contract liabilities Sichuan West Enjoying Life Trading Co., Ltd. 0.90 0.90
Contract liabilities Pengzhou Enjoying Life Trading Co., Ltd. 8.37 8.37
7. Commitments of related parties: None
8. Others: None
XIII. Share-based Payment
1. Overall information on share-based payment
√ Applicable □ Not applicable
Unit: RMB
165
C&S Paper Co., Ltd. Semi-annual Report 2023
The Company’s total amount of all
equity instruments granted in the 36,441,500.00
current period
The Company’s total amount of all
equity instruments exercised in the 744,955.00
current period
The Company’s total amount of all
equity instruments expired in the 6,082.00
current period
1. The exercise price for reserved stock options awarded by the Company under the
2018 Stock Option and Restricted Stock Incentive Plan as at the end of reporting period
is RMB13.703/share; the validity period is from the grant date of the stock options to
the date when all stock options are exercised or canceled, with a maximum period of
60 months.
Scope of exercise prices and remaining 2. The grant price for restricted shares awarded by the Company in the first grant under
contractual term of the Company’ stock the 2022 Stock Option and Restricted Stock Incentive Plan as at the end of reporting
options issued as at the end of the period is RMB6.32/share, and the validity period is from the registration completion
reporting period date of the first-granted restricted shares to the date when all the shares are unlocked or
repurchased and canceled, with a maximum period of 60 months. The exercise price
for stock options awarded in the first grant is RMB9.48 per share, and the validity
period is from the registration completion date of the first-granted stock opinions to the
date when all the options are exercised or canceled, with a maximum period of 60
months.
2. Equity-settled share-based payment
√ Applicable □ Not applicable
Unit: RMB
Method of determining the fair value of equity instruments at Restricted shares: the stock closing prices at the grant date
the grant date Stock options: Black-Scholes model for option pricing
Basis for determining the number of vested equity instruments Upon approval of the general meeting of shareholders
Reasons for significant differences between current estimates
None
and previous estimates
Cumulative amount of equity-settled share-based payments
148,368,269.99
recognized as capital surplus
Total fees confirmed by the equity-settled share-based payment
29,687,986.01
in the current period
3. Cash-settled share-based payment
□ Applicable √ Not applicable
4. Revision and termination of share-based payment
There was no revision and termination of share-based payment of the Company during the reporting period.
5. Others: None
XIV. Commitments and Contingencies
1. Significant commitments
Significant commitments on the balance sheet date
166
C&S Paper Co., Ltd. Semi-annual Report 2023
As at June 30, 2023, the Company had no significant commitments that should have been disclosed but are not
disclosed.
2. Contingencies
(1) Significant contingent matters on the balance sheet date
The situation of our company providing guarantees for subsidiaries:
Whether it is
Starting date of Guarantee
Guaranteed party Currency Guarantee amount related party
guarantee expiration date
guarantee?
C&S Hong Kong、Macao C&S、
USD 50,000,000.00 2022.11.14 2027.7.31 No
Zhong Shun International
Zhongshan Trading RMB 150,000,000.00 2022.11.23 2026.11.9 No
Zhongshan Trading RMB 200,000,000.00 2023.1.30 2029.1.29 No
Zhongshan Trading RMB 200,000,000.00 2023.6.14 2027.4.19 No
Zhongshan Trading RMB 100,000,000.00 2023.5.25 2027.4.18 No
Zhongshan Trading RMB 500,000,000.00 2023.4.26 2028.12.31 No
Zhongshan Trading RMB 50,000,000.00 2023.4.27 2027.4.27 No
Zhongshan Trading RMB 300,000,000.00 2022.12.8 2025.12.31 No
Zhongshan Trading RMB 150,000,000.00 2022.12.23 2026.9.22 No
Zhongshan Trading RMB 200,000,000.00 2022.5.17 2030.2.27 No
Zhongshan Trading RMB 200,000,000.00 2022.8.18 2030.12.31 No
Jiangmen C&S RMB 120,000,000.00 2022.11.23 2026.11.7 No
Jiangmen C&S RMB 150,000,000.00 2023.1.17 2026.11.29 No
Jiangmen C&S RMB 150,000,000.00 2023.6.14 2027.4.19 No
Jiangmen C&S RMB 100,000,000.00 2023.5.25 2027.4.18 No
Jiangmen C&S RMB 50,000,000.00 2020.12.23 2025.12.23 No
Yunfu Trading RMB 200,000,000.00 2022.11.23 2026.11.7 No
Yunfu Trading RMB 80,000,000.00 2020.4.14 2028.4.14 No
Yunfu Trading RMB 150,000,000.00 2023.6.15 2027.4.19 No
Yunfu Trading RMB 70,000,000.00 2023.1.17 2026.11.29 No
Yunfu Trading RMB 100,000,000.00 2023.5.25 2027.4.18 No
Hubei C&S RMB 100,000,000.00 2023.2.13 2030.11.2 No
Dazhou C&S RMB 100,000,000.00 2023.2.13 2029.11.2 No
Jiangmen C&S、Yunfu Trading、
RMB 220,000,000.00 2022.1.17 2026.1.17 No
Hubei C&S
C&S Hong Kong、Zhong Shun
HKD 203,000,000.00 2021.9.8 2024.9.8 No
International
C&S Hong Kong、Macao C&S HKD 400,000,000.00 2021.3.17 2025.12.31 No
C&S Hong Kong、Macao C&S USD 24,000,000.00 2020.3.27 2025.8..22 No
C&S Hong Kong、Zhong Shun
USD 30,000,000.00 2023.3.29 2026.3.29 No
International、Macao C&S
167
C&S Paper Co., Ltd. Semi-annual Report 2023
Whether it is
Starting date of Guarantee
Guaranteed party Currency Guarantee amount related party
guarantee expiration date
guarantee?
C&S Hong Kong、Zhong Shun
USD 63,500,000.00 2023.1.20 2026.1.20 No
International、Macao C&S
C&S Hong Kong、Zhong Shun
USD 30,000,000.00 2023.4.24 2026.2.22 No
International
C&S Hong Kong USD 20,000,000.00 2022.9.1 2024.9.1 No
C&S Hong Kong USD 10,000,000.00 2022.11.17 2029.10.28 No
Macao C&S USD 11,000,000.00 2018.3.23 2024.9.23 No
Macao C&S USD 10,000,000.00 2022.11.17 2029.10.28 No
Macao C&S USD 30,000,000.00 2021.11.12 2024.10.20 No
Macao C&S RMB 70,000,000.00 2018.8.15 2025.8.15 No
(2) Explanations are also necessary if the Company has no significant contingent matters to be disclosed
There are no significant contingent matters to be disclosed in the Company.
168
C&S Paper Co., Ltd. Semi-annual Report 2023
3. Others: None
XV. Events after Balance Sheet Date
1. Significant non-adjusting events: None
2. Profit distribution: None
3. Sales return: None
4. Explanation on other events after the balance sheet date: None
XVI. Other Significant Matters
1. Corrections to previous accounting errors
2. Debt restructuring: None
3. Assets replacing
4. Annuities plan: None
5. Operation discontinuation: None
6. Segment information
(1) Determination basis and accounting policies of reporting segments
The Company does not have operating segments with different economic features and hence has not identified
operating segments according to internal organization structure, management requirements and internal reporting
policies. Therefore, there was no information on reporting segments based on operating segments to be disclosed.
(2) Financial information on reporting segments: None
(3) Explanation on reasons if the Company has no reporting segments or is unable to disclose the total assets
and liabilities of the reporting segments: None
(4) Other description: None
7. Other important transactions and matters that may affect the decisions of investors: None
8. Others
External guarantees of the Company
169
C&S Paper Co., Ltd. Semi-annual Report 2023
In 2022, the Company signed the XIAOYIDA Business Cooperation Agreement with Bank of China Limited
Zhongshan Branch and Shanghai Junmeng E-commerce Co., Ltd. (No. 2022-XYDXY-33725001), under which the
bank offers a credit line of XIAOYIDA service up to RMB235 million to Shanghai Junmeng and the Company
provides a joint and several liabilities guarantee. The line of credit is valid from September 27, 2022 to August 4,
2023. As of June 30, 2023, Shanghai Junmeng E-commerce Co., Ltd. has a financing balance of RMB 90 million
in sales of XIAOYIDA business.
In 2022, Zhongshan Zhongshun Trading Co., Ltd., a subsidiary of the Company, signed the XIAOYIDA Business
Cooperation Agreement with Bank of China Limited Zhongshan Branch and Wuhan Jie Rou E-commerce Co., Ltd.
(No. 2022-XYDXY-33725002), under which the bank offers a credit line of XIAOYIDA service up to RMB150
million to Wuhan Jie Rou and the Company provides a joint and several liabilities guarantee. The line of credit is
valid from September 26, 2022 to August 3, 2023. As of June 30, 2023, Wuhan Jie Rou E-commerce Co., Ltd. has
a financing balance of RMB 88.6 million in sales of XIAOYIDA business.
XVII. Notes to Major Items of Financial Statements of the Parent Company
1. Accounts receivable
(1) Accounts receivable disclosure by category
Unit: RMB
Balance at the end of the period Balance at the beginning of the period
Impairment Impairment
Book balance Book balance
Category provision Book provision
Book value
Percenta Provision value Percentag Provision
Amount Amount Amount Amount
ge ratio e ratio
Including:
Accounts receivable
for which bad debt 102,751, 2,258,36 100,492,7 140,697,7 1,966,017 138,731,75
100.00% 2.20% 100.00% 1.40%
reserve is set aside in 123.49 4.23 59.26 70.14 .33 2.81
portfolios
Including:
Portfolio based on 73,836,8 2,258,36 71,578,46 61,917,49 1,966,017 59,951,481.
aging 71.86% 3.06% 44.01% 3.18%
25.99 4.23 1.76 9.22 .33 89
Portfolio based on 28,914,2 28,914,29 78,780,27 78,780,270.
related parties 28.14% 55.99%
97.50 7.50 0.92 92
102,751, 2,258,36 100,492,7 140,697,7 1,966,017 138,731,75
Total 100.00% 2.20% 100.00% 1.40%
123.49 4.23 59.26 70.14 .33 2.81
Bad debt reserve set aside in portfolios: 2,258,364.23
Unit: RMB
Balance at the end of the period
Name
Book balance Impairment provision Ratio of provision
Within the credit period 61,071,930.68 1,221,438.61 2.00%
Credit period - 1 year 9,505,875.50 475,293.79 5.00%
1 to 2 years 2,930,657.31 439,598.60 15.00%
2 to 3 years 210,740.10 63,222.03 30.00%
3 to 5 years 117,622.40 58,811.20 50.00%
170
C&S Paper Co., Ltd. Semi-annual Report 2023
Total 73,836,825.99 2,258,364.23
Description of reason for the portfolio:
Accounts receivable with the same aging have similar credit risk characteristics.
Description of reason for the portfolio:
If the bad debt reserve of accounts receivable is set aside according to general model of expected credit loss, please refer to the
disclosure method of other receivables to disclose relevant information on bad debt reserve:
□ Applicable √ Not applicable
Disclose by aging
Unit: RMB
Aging Book balance
Within 1 year (inclusive) 99,492,103.68
1 to 2 years 2,930,657.31
2 to 3 years 210,740.10
Over 3 years 117,622.40
3 to 4 years 117,622.40
Total 102,751,123.49
(2) Bad debt reserve that is set aside, recovered or transferred back in the reporting period
Provision of bad debt reserve of the reporting period:
Unit: RMB
Balance at the Amount of change in the reporting period
Balance at the
Category beginning of the Recovery or
Provision Write-off Others end of the period
period reversal
Accounts receivable 1,966,017.33 292,346.90 2,258,364.23
Total 1,966,017.33 292,346.90 2,258,364.23
(3) Accounts receivable actually written off in the reporting period
The Company did not have written-off accounts receivable in the reporting period.
(4) Top five debtors in closing balance of accounts receivable
Unit: RMB
Percentage in total balance of
Balance of accounts receivable Balance for bad debt reserve at
Name of institution accounts receivable at the end
at the end of the period the end of the period
of the period
1st 31,443,340.61 30.60% 645,652.01
2nd 28,296,177.06 27.54%
3rd 4,242,977.08 4.13% 116,436.57
4th 3,657,504.03 3.56% 81,155.74
5th 2,759,915.64 2.69% 55,198.31
Total 70,399,914.42 68.52%
171
C&S Paper Co., Ltd. Semi-annual Report 2023
(5) Amounts of assets and liabilities that are formed by the transfer and ongoing involvement of accounts
receivable
The Company has no accounts receivable derecognized due to the transfer of financial assets as at the end of the
reporting period.
(6) Accounts receivable derecognized due to transfer of financial assets
The Company has no accounts receivable derecognized due to transfer of financial assets.
2. Other receivables
Unit: RMB
Item Balance at the end of the period Balance at the beginning of the period
Other receivables 101,551,635.79 226,320,859.44
Total 101,551,635.79 226,320,859.44
(1) Interest receivable
1) Classification of interest receivable: None
2) Significant overdue interest: None
3) Provision of bad debt reserve
□ Applicable √ Not applicable
(2) Dividends receivable
1) Classification of dividends receivable: None
2) Significant dividends receivable exceeding one year: None
3) Provision of bad debt reserve
□ Applicable √ Not applicable
Other description: None
(3) Other receivables
1) Classification of other receivables by nature
Unit: RMB
Nature Book balance at the end of the period Book balance at the beginning of the period
172
C&S Paper Co., Ltd. Semi-annual Report 2023
Current accounts 99,440,532.11 223,230,988.36
Margins and deposits 573,671.00 345,165.60
Reserve 1,359,974.52 436,792.35
Others 512,657.58 2,663,363.48
Total 101,886,835.21 226,676,309.79
2) Provision of bad debt reserve
Unit: RMB
Phase I Phase II Phase III
Bad debt provision Expected credit losses in the Expected credit losses in Total
Expected credit loss in
whole duration (without the whole duration (with
the next 12 months
credit impairment) credit impairment)
Balance as at January 1, 2021 355,450.35 355,450.35
Balance as at January 1, 2021 in the
reporting period
Transferred-back in the reporting period -20,250.93 -20,250.93
Balance as at December 31, 2021 335,199.42 335,199.42
Description of changes in the book balance where there are significant changes in provision for the current period
□ Applicable √ Not applicable
Disclose by aging
Unit: RMB
Aging Book balance
Within 1 year (inclusive) 101,741,744.50
1 to 2 years 90,490.71
2 to 3 years 28,600.00
Over 3 years 26,000.00
Over 5 years 26,000.00
Total 101,886,835.21
3) Bad debt reserve that is set aside, recovered or transferred back in the reporting period
Provision of bad debt reserve of the reporting period:
Unit: RMB
Balance at the Amount of change in the reporting period
Balance at the end
Category beginning of Recovery or
Provision Write-off Others of the period
the period reversal
Other receivables 355,450.35 -20,250.93 335,199.42
Total 355,450.35 -20,250.93 335,199.42
4) Other receivables actually written off in the reporting period: None
5) Top five debtors in closing balance of other accounts receivable
Unit: RMB
Name of Nature of the Balance at the end Aging Percentage in total balance Balance of bad
173
C&S Paper Co., Ltd. Semi-annual Report 2023
institution amount of the period of other receivables at the debt reserve at the
end of the period end of the period
1st Current accounts 50,000,000.00 Within 1 year 49.07%
2nd Current accounts 45,675,960.94 Within 1 year 44.83%
3rd Current accounts 1,002,000.00 Within 1 year 0.98% 50,100.00
4th Current accounts 629,891.67 Within 1 year 0.62% 31,494.58
5th Others 398,499.92 Within 1 year 0.39% 19,925.00
Total 97,706,352.53 95.89% 101,519.58
6) Receivables involving government grants: None
7) Other receivables derecognized due to the transfer of financial assets: None
8) Amount of assets and liabilities that are formed by the transfer and ongoing involvement of other
receivables: None
3. Long-term equity investments
Unit: RMB
Balance at the end of the period Balance at the beginning of the period
Item Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Investment in subsidiaries 2,063,642,700.23 2,063,642,700.23 2,007,893,370.09 2,007,893,370.09
Total 2,063,642,700.23 2,063,642,700.23 2,007,893,370.09 2,007,893,370.09
(1) Investment in subsidiaries
Unit: RMB
Increase/decrease in the period Closing
Balance at the
balance of
beginning of the Closing balance
Investee Increase in Decrease in Impairmen impairme
period Others (book value)
investment investment t Provision nt
(Book value)
provision
Jiangmen
Zhongshun
699,279,941.09 418,173.42 699,698,114.51
Paper Co.,
Ltd.
Zhongshan
Zhongshun
97,017,154.32 3,762,092.33 100,779,246.65
Trading Co.,
Ltd.
Yunfu
Hengtai
30,201,334.69 30,201,334.69
Trading Co.,
Ltd.
C&S (Yunfu)
Paper Co., 658,739,470.31 1,191,459.81 659,930,930.12
Ltd.
C&S
(Zhongshan)
12,683,100.00 12,683,100.00
Paper Co.,
Ltd.
174
C&S Paper Co., Ltd. Semi-annual Report 2023
Sun Daily
Necessities 200,000.00 200,000.00
Co., Ltd.
C&S
(Sichuan)
177,190,962.29 6,094,059.24 183,285,021.53
Paper Co.,
Ltd.
C&S
(Dazhou) 39,000,000.
61,000,000.00 117,026.34 100,117,026.34
Paper Co., 00
Ltd.
C&S (Hubei)
Paper Co., 197,773,603.11 3,276,897.18 201,050,500.29
Ltd.
Zhejiang
Zhongshun
58,324,220.72 1,616,562.91 59,940,783.63
Paper Co.,
Ltd.
C&S
(Jiangsu)
6,302,118.41 6,302,118.41
Paper Co.,
Ltd.
Zhong Shun
International 900,563.53 156,032.58 1,056,596.11
Co., Ltd.
Dolemi
Sanitary
1,060.18 1,060.18
Products Co.,
Ltd.
Chengdu
Zhongshun
678,315.22 54,611.97 732,927.19
Paper Co.,
Ltd.
Xiaogan
C&S Trading 322,149.62 322,149.62
Co., Ltd.
Hangzhou Jie
Rou Trading 130,799.98 62,414.36 193,214.34
Co., Ltd.
Shanghai
Huicong
8,576.62 8,576.62
Paper Co.,
Ltd.
Beijing
Bloomage
Jierou
2,040,000.00 2,040,000.00
Biotechnol
ogy Co.,
Ltd.
Guangdong
Huashun
Material
5,100,000.00 5,100,000.00
Technolog
y Co., Ltd
合计 2,007,893,370.09 39,000,000. 16,749,330.1 2,063,642,700.2
175
C&S Paper Co., Ltd. Semi-annual Report 2023
00 4 3
(2) Investment in associates and joint ventures: None
(3) Other description: None
4. Operating income and operating cost
Unit: RMB
Incurred in the current period Incurred in the prior period
Item
Income Cost Income Cost
Principal business 787,073,336.16 728,588,036.18 1,040,228,094.53 934,724,115.97
Total 787,073,336.16 728,588,036.18 1,040,228,094.53 934,724,115.97
Information related to income:
Unit: RMB
Contract classification Branch 1 Branch 2 Total
By product type 787,073,336.16 787,073,336.16
Including:
Household paper 776,465,513.84 776,465,513.84
Personal care and others 10,607,822.32 10,607,822.32
By operating region 787,073,336.16 787,073,336.16
Including:
Domestic 787,073,336.16 787,073,336.16
Abroad
By market or customer
type
Including:
Contract type
Including:
By the time of goods
transfer
Including:
By contract term
Including:
By sales channel 787,073,336.16 787,073,336.16
Including:
Traditional 476,881,334.83 476,881,334.83
Non-traditional 310,192,001.33 310,192,001.33
Total 787,073,336.16 787,073,336.16
Information related to performance obligation: None
Information related to the transaction price apportioned to the remaining performance obligation:
The amount of income corresponding to the obligations of contract performance with an executed contract that is not performed or
fully performed at the end of the reporting period is RMB1,788,737.74, of which the income of RMB1,788,737.74 is expected to be
confirmed as income in the year of 2023.
5. Return on investment
Unit: RMB
Item Incurred in the current period Incurred in the prior period
176
C&S Paper Co., Ltd. Semi-annual Report 2023
Income from long-term equity-based
investment accounted for using the cost 454,700,000.00 491,775,000.00
method
Investment income from disposal of trading
financial assets 968,000.00
Others 990,155.36 136,145.00
Total 456,658,155.36 491,911,145.00
6. Others: None
XVIII. Supplementary Information
1.List of non-recurring profits and losses of the reporting period
√ Applicable □ Not applicable
Unit: RMB
Item Amount Description
Profits/losses from the disposal of non-current asset -2,960,777.02
Governmental grants reckoned into current profits/losses (not including
grants enjoyed in quota or ration according to national standards, which are 11,874,320.21
closely relevant to the company’s normal business)
Profits/losses from assets entrusted to others for investment or management 990,155.36
Except for effective hedging business related to the normal operation of the
company, fair value gains and losses arising from holding trading financial
assets and trading financial liabilities, as well as investment income 968,000.00
obtained from disposal of trading financial assets, trading financial
liabilities, and available for sale financial assets
Other non-operating income and expenses except for the aforementioned
2,680,646.89
items
Less: Influence of income tax 2,756,058.56
Total 10,796,286.88 --
Details of other profit and loss items that meet the definition of non-recurring profit and loss:
□ Applicable √ Not applicable
The Company has no other profit and loss items that meet the definition of non-recurring profit and loss.
Descriptions where the Company defines any non-recurring profit and loss items listed in the No. 1 Explanatory Announcement on
Information Disclosure of Companies Offering Securities to the Public—Non-recurring Profit and Loss as recurring profit and loss
items during the reporting period
□ Applicable √ Not applicable
2. Return on net assets and earnings per share
Earnings per share
Weighted average
Profit in the reporting period
return on net assets Basic earnings per share Diluted earnings per
(RMB/share) share (RMB/share)
Net profit attributable to the ordinary shareholders of the
Company 1.61% 0.06 0.06
Net profit attributable to the ordinary shareholders of the
Company after excluding non-recurring profit and loss 1.40% 0.06 0.06
177
C&S Paper Co., Ltd. Semi-annual Report 2023
3. Difference in accounting data under domestic and international accounting standards
(1) Net profit and net asset differences under International Financial Reporting Standards (IFRS) and
Chinese Accounting Standards (CAS)
□ Applicable √ Not applicable
(2) Net profit and net asset differences under foreign accounting standards and Chinese Accounting
Standards (CAS)
□ Applicable √ Not applicable
(3) Explanation of reasons for the differences between accounting data disclosed under domestic and overseas
accounting standards. If differences are adjusted based on data audited by overseas audit institutions, the
name of the institution should be noted.
4. Others: None
If there are any ambiguities, the Chinese version shall prevail.
178
