China Vanke Co., Ltd.
2013 Third Quarterly Report
§1 Important Notice
1.1 The Board, the Supervisory Committee, Directors, members of the Supervisory Committee and
senior management of the Company warrant that in respect of the information contained in this
Quarterly Report, there are no misrepresentations or misleading statements, or material omission, and
individually and collectively accept full responsibility for the authenticity, accuracy and completeness
of the information contained in this Quarterly Report.
1.2 None of the Directors, members of the Supervisory Committee and senior management fails to
assure or disputes with the authenticity, accuracy and completeness of the contents of this Quarterly
Report.
1.3 Director Qiao Shibo and Director Wei Bin were not able to attend the board meeting in person due
to their business engagements and had authorised Director Yu Liang to represent them and vote on
behalf of them. Director Chen Ying was not able to attend the board meeting in person due to his
business engagements and had authorised Director Xiao Li to represent him and vote on behalf of him.
Independent Director Zhang Liping was not able to attend the board meeting in person due to his
business engagements and had authorised Independent Director Elizabeth Law to represent him and
vote on behalf of him.
1.4 This quarterly financial report of the Company has not been audited.
1.5 The Company’s Chairman Wang Shi, Director and President Yu Liang, and Executive Vice
President and Supervisor of Finance Wang Wenjin declare that the financial report contained in this
Quarterly Report is warranted to be true and complete.
§2 Basic Corporate Information
2.1 Major accounting data and financial guidance
(Unit: RMB'000)
As at 30 September 2013 As at 31 December 2012 Change (+/-)
Total assets 461,418,138 379,094,856 21.72%
Equity attributable to the equity shareholders
68,265,638 63,825,554 6.96%
of the Company
Share capital (share) 11,014,872 10,995,553 0.18%
Net assets per share attributable to equity
6.20 5.80 6.77%
shareholders of the Company (RMB)
1
July to September January to
YOY change (+/-) YOY change (+/-)
2013 September 2013
Revenue 20,708,147 44.84% 59,648,956 37.89%
Profit attributable to equity shareholders of
1,603,914 18.39% 6,160,219 21.27%
the Company
Net cash inflow from operating activities - - (12,060,759) -245.53%
Net cash inflow from operating activities per
- - (1.09) -244.92%
share (RMB)
Basic earnings per share (RMB) 0.146 18.70% 0.560 21.21%
Diluted earnings per share (RMB) 0.146 18.70% 0.560 21.21%
Decreased by 0.06 Increased by 0.03
Return on equity 2.38% 9.31%
percentage point percentage point
Note: 1. The net assets and net profit used to calculate the above-mentioned indicators refer to the equity attributable to
equity shareholders of the Company and profit attributable to equity shareholders of the Company respectively.
2. The above-mentioned return on equity is calculated using weighted average method.
3. As some of the beneficiaries exercised their stock options, the Company's share capital therefore increased by
19,319,001 shares from January to September 2013.
2.2 Total number of shareholders and shareholdings of the top 10 shareholders of non-restricted
tradable shares as at the end of the reporting period
As at 30 September 2013, the total number of shareholders of the Company was 730,943 (including
713,492 holders of A shares and 17,451 holders of B shares).
Total number of shareholders as at the end of the reporting period 730,943
Shareholdings of the top 10 shareholders
Classification Percentage of Total Number of Number of
Name of shareholder of shareholder shareholdings number of restricted pledged or
shares held shares held lock-up shares
State-owned
China Resources Co., Limited (“CRC”) 14.70% 1,619,094,766 0 0
legal person
Liu Yuansheng Others 1.21% 133,791,208 0 0
China Life Insurance Company Limited –
Dividend Distribution–Individual Others 1.17% 128,697,824 0 0
Dividend-005L-FH002 Shen
Bosera Value Growth Securities Investment
Others 1.01% 111,237,491 0 0
Fund
China Minsheng Banking Corp. Ltd.－
Yinhua Shenzhen Stock Exchange 100 Others 1.00% 109,766,105 0 0
Index Classified Securities Investment Fund
HTHK/CMG FSGUFP-CMG FIRST Foreign
0.93% 102,874,948 0 0
STATE CHINA GROWTH FD shareholder
Bank of China－E Fund Shenzhen Stock
Others 0.81% 88,797,727 0 0
Exchange 100 Exchange-Traded Fund
Industrial and Commercial Bank of China –
Rongtong Shenzhen Stock Exchange 100 Others 0.80% 88,152,186 0 0
Index Securities Investment Fund
New China Life Insurance
Company–Dividend Distribution–Individual Others 0.71% 77,728,549 0 0
Dividend - 018L - FH002 Shen
Gao Hua-HSBC-GOLDMAN, SACHS
Others 0.62% 68,247,255 0 0
& CO
Remarks on strategic investor or ordinary
legal person becoming top 10 shareholders Nil
after placing of new shares
Shareholdings of the top 10 holders of non-restricted shares
Name of shareholder Number of non-restricted shares held Class of shares
2
China Resources Co., Limited (“CRC”) 1,619,094,766 Ordinary RMB-denominated shares (A shares)
Liu Yuansheng 133,791,208 Ordinary RMB-denominated shares (A shares)
China Life Insurance Company Limited –
Dividend Distribution–Individual 128,697,824 Ordinary RMB-denominated shares (A shares)
Dividend-005L-FH002 Shen
Bosera Value Growth Securities Investment
111,237,491 Ordinary RMB-denominated shares (A shares)
Fund
China Minsheng Banking Corp. Ltd.－
Yinhua Shenzhen Stock Exchange 100 109,766,105 Ordinary RMB-denominated shares (A shares)
Index Classified Securities Investment Fund
HTHK/CMG FSGUFP-CMG FIRST
102,874,948 Domestic listed foreign shares (B shares)
STATE CHINA GROWTH FD
Bank of China－E Fund Shenzhen Stock
88,797,727 Ordinary RMB-denominated shares (A shares)
Exchange 100 Exchange-Traded Fund
Industrial and Commercial Bank of China –
Rongtong Shenzhen Stock Exchange 100 88,152,186 Ordinary RMB-denominated shares (A shares)
Index Securities Investment Fund
New China Life Insurance
Company–Dividend Distribution–Individual 77,728,549 Ordinary RMB-denominated shares (A shares)
Dividend - 018L - FH002 Shen
Gao Hua-HSBC-GOLDMAN, SACHS
68,247,255 Ordinary RMB-denominated shares (A shares)
& CO
Remarks on the connected relationship or It is not known as to whether there are connections or persons deemed to be acting in concert
action in concert of the aforementioned under “the Measures for the Administration of the Takeover of Listed Companies” among the
shareholders above-mentioned shareholders.
Remarks on shareholders involved in Nil
securities margin trading
As at 30 September 2013, the total number of shares of the Company was 11,014,872,119 shares,
including 9,699,916,651 A shares and 1,314,955,468 B shares.
§3 Management Discussion and Analysis
During the reporting period, the sales area of commodity housing in China increased by 14.9%
year-on-year, while sales of commodity housing in 14 cities including Beijing, Shanghai, Shenzhen,
Guangzhou, Tianjin, Shenyang, Hangzhou, Nanjing, Chengdu, Wuhan, Dongguan, Foshan, Wuxi and
Suzhou remained modestly robust. However, owing to the relatively higher comparative figure of
2012 same period, the sales area of residential properties of the aforementioned 14 cities in the third
quarter dropped by 5.7% year-on-year.
In the third quarter of 2013, the approved pre-sales area of new housing in the above-mentioned cities
increased by 5.6% when compared with that in the second quarter. The supply of new housing in most
of the cities was rather abundant except for Beijing, which saw a relatively tight supply of salable
resources in the short term. The market’s demand and supply relationship was fairly reasonable. As at
the end of September, the duration for the market to absorb housing inventory in the 14 cities
increased slightly from 10.4 months at the end of June to 11.4 months. The relatively abundant
amount of new housing supply did not support the continued rise of housing prices.
During the reporting period, the Company continued to adhere to its product positioning with a focus
on end-users and implemented its active sales promotion strategy. In the third quarter, the Company
realized a sales area and sales amount of 3,823,000 sq m and RMB44.82 billion respectively,
representing year-on-year increases of 25.2% and 32.7% respectively. From January to September, the
Company’s accumulated sales area and sales amount amounted to 10,987,000 sq m and RMB128.50
billion respectively, representing year-on-year increases of 21.0% and 33.4% respectively.
3
In the third quarter of 2013, the Company realized a booked area and booked revenue of 1,922,000 sq
m and RMB20.28 billion respectively, representing year-on-year increases of 48.3% and 44.1%
respectively. Meanwhile, the Company realized revenue and net profit of RMB20.71 billion and
RMB1.60 billion respectively, representing year-on-year increases of 44.8% and 18.4% respectively.
From January to September 2013, the Company achieved an accumulated booked area of 5,806,000
sq m and booked revenue of RMB58.50 billion, representing year-on-year increases of 47.6% and
37.9% respectively; as well as revenue and net profit of RMB59.65 billion and RMB6.16 billion
respectively, representing year-on-year increases of 37.9% and 21.3% respectively.
As at the end of the reporting period, the Company had an area of 17,377,000 sq m sold but not yet
booked, which was stated in the consolidated statements as construction had yet to be completed. This
area had a contract amount of approximately RMB192.86 billion. The area and contract amount were
28.3% and 34.3% higher than those at the beginning of the year.
As at the end of September, among the Company’s different types of inventories, completed
properties (completed properties ready for sale) amounted to RMB17.83 billion, accounting for 5.3%.
A reasonable mix of inventories had been maintained.
Between January and September, the Company had a floor area of 13,623,000 sq m commenced
construction and a completed area of 6,516,000 sq m, representing year-on-year increases of 56.4%
and 48.7% respectively, representing the completion of 82.4% and 50.5% of the respective plans set at
the beginning of the year. As construction of a number of projects acquired this year gradually
commenced, it is expected that the actual area commencing construction for the full year may exceed
the area planned at the beginning of the year. Meanwhile, it is expected that the area to be completed
for the full year will be basically the same as that had been planned at the start of the year.
Since this year, land markets across China had showed significant difference in performance. In third-
and fourth-tier cities, which make up the majority of the country, there were not many changes in land
sales when compared with those of the same period last year. On the other hand, the land markets in
some popular cities continued to heat up, with intense auctions. The starting price, reserve price and
average actual selling price continued to rise, and reached new highs in recent years.
In view of business expansion, the Company replenished its land bank with a moderate number of
promising sites in major cities to meet its actual development needs during the reporting period. In the
third quarter, the Company acquired an aggregate of 32 new projects, with a total site area attributable
to China Vanke’s equity holding of approximately 2,680,000 sq m, corresponding to a planned GFA
attributable to the Company’s equity holding of approximately 7,750,000 sq m. Although a majority
of the projects acquired in the third quarter were located in the highly competitive first-tier cities, the
Company had not relaxed its investment standards. Instead, the Company adhered to its prudent
investment principles when making investment decisions, insisted on thorough consideration of the
rationality of land prices, and avoided those sites which created overly optimistic expectations and
excessive competition. As at the end of the reporting period, the GFA of the Company’s projects under
planning attributable to China Vanke’s equity holding amounted to 45,680,000 sq m, which was
sufficient to meet the Company’s development and operation needs in the coming two to three years.
4
In future, the Company will continue to focus on reasonable investment opportunities, while ensuring
operational soundness.
The Company’s persistent strategy of proactive sales and prudent investment has been keeping the
Company in a healthy financial and assets position. As at the end of the reporting period, the
Company’s cash and cash equivalents amounted to RMB37.06 billion, which was basically the same
as that of 2013 interim period. Excluding receipts in advance, the Company’s other liabilities
accounted for 41.52% of the Company’s total assets. The Company’s net gearing ratio dropped by
1.58 percentage points as compared to that of the interim period to 39.90%, which remained at a
relatively low level as compared to the industry average.
§4 Significant Events
4.1 Significant changes and reasons for such changes in major items of the accounting
statements and financial indicators of the Company
√Applicable □Not applicable
30/9/2013 31/12/2012 Change
Items Reasons for change
(RMB’000) (RMB’000) (+/-)
Expansion of scale of operation, increase
Inventories 337,823,979 253,622,152 33.20%
in acquired projects
Investment properties 2,080,347 1,714,136 21.36% Increase in investment properties
Interest in associates 4,708,238 2,915,844 61.47% Increase in investment of associates
Jan-Sep 2013 Jan-Sep 2012 Change
Items Reasons for change
(RMB’000) (RMB’000) (+/-)
Revenue 59,648,956 43,257,310 37.89% Increase in booked area
Cost of sales (43,043,695) (28,896,138) 48.96% Increase in booked area
Administrative expenses (1,990,281) (1,623,066) 22.62% Increase in sales area
Profit Attributable for Increase in booked profit of joint venture
1,316,925 1,066,285 23.51%
Non-controlling interests projects
4.2 Progress of significant events and analysis of their impact and solutions
√Applicable □Not applicable
5
On 8 April 2011, the first extraordinary general meeting of the Company in 2011 considered and passed the
Company’s A-Share Stock Option Incentive Scheme (Revised Draft). The Company’s A-Share Stock Option Incentive
Scheme (“Scheme”) was thereby implemented. On 9 May 2011, the registration of the grant of stock options was
completed. The Company granted 108,435,000 stock options to 810 beneficiaries. The abbreviation of the stock options is
Vanke JLC1, while the stock option code is 037015.
The initial exercise price of the stock options was RMB8.89. The Company implemented the proposal on dividend
distribution for the year 2010 on 27 May 2011, and distributed a cash dividend of RMB1.0 (including tax) to all
shareholders for every 10 existing shares held. In accordance with relevant regulations and the resolutions passed at the
shareholders meeting, the Board made adjustment to the exercise price of the stock options to RMB8.79. The Company
implemented the proposal on dividend distribution for the year 2011 on 5 July 2012, and distributed a cash dividend of
RMB1.3 (including tax) to all shareholders for every 10 existing shares held. Pursuant to the requirements, the exercise
price of the stock options was adjusted to RMB8.66. The Company implemented the proposal on dividend distribution for
2012 on 16 May 2013, and distributed a cash dividend of RMB1.8 (including tax) to all shareholders for every 10
existing shares held. The Company made another adjustment of the exercise price of the stock options pursuant to the
requirements and the adjusted exercise price was RMB8.48.
During July to September 2013, a total of 1,147,200 stock options were exercised. Owing to reasons including the
departure of some of the beneficiaries, an aggregate of 1,029,000 stock options were lapsed. As at the end of the reporting
period, the total number of stock options granted but not yet exercised amounted to 71,161,100.
The introduction of the Scheme complements the Company’s incentive instruments with a long-term plan, while
establishing a check-and-balance mechanism between shareholders and professional management team through linking
up their interests. The Scheme will further improve the Company’s corporate governance structure and strengthen the
Company’s competitiveness.
4.3 Implementation of the undertakings given by the Company, shareholders and beneficial
controllers
√ Applicable □Not applicable
Undertaking Details Implementation
China Resources National Corporation (“CRNC”) – the parent company
of CRC, being the Company’s original single largest shareholder and the
present single largest shareholder, gave a significant undertaking to the
Company in 2001: CRNC would provide as much support to the Company
CRNC has fulfilled its
Other undertakings as it did in the past, as long as such support was beneficial to the
undertakings.
Company’s development, and that it would remain impartial in the event
of any competition between the investment projects of the Company and
that of CRNC and its subsidiaries, and in the event of any disagreements
or disputes arising from horizontal competition.
4.4 Warning of and explanation for the accumulated net profit from the beginning of the year to
the end of the next reporting period forecast to be a probable loss or to be significantly differed
from that of the corresponding period of the previous year
□Applicable √Not applicable
4.5 Other major events that require disclosure
4.5.1 Securities investments
□Applicable √Not applicable
4.5.2 Equity interests held in other listed companies
√Applicable □Not applicable
(Unit: RMB)
Book Gains/(losse Changes in equity
Initial Percentage
Stock Stock value as at s) during attributable to equity
investment of
code abbreviation the end of during shareholders during
amount shareholdings
the period Jan-Sep 2013 Jan-Sep 2013
Tianjin Marine
600751 Shipping Co., Ltd. 143,600.00 0.02% 974,400.00 - 623,100.00
Total 143,600.00 0.02% 974,400.00 - 623,100.00
Note: Equity interests of Tianjin Marine Shipping Co., Ltd are legal person shares held by the Company over the years. Tianjin
Marine Shipping Co., Ltd completed the share reform during the first half of 2013
6
4.5.3 Investor relations activities such as meetings, communications and visits during the
reporting period
Issues
discussed
Type of activities Time Location Approach Classification of visitors and
information
provided
Merrill Lynch Face to face Investors including securities (I) Major
2013.7 Hong Kong
meeting meeting companies, funds, etc. issues
Hong Kong, Investors including securities discussed:
Interim results Face to face (1) The
2013.8 Shenzhen,(Shanghai companies, funds, individual
presentation meeting
, Beijing) investors, etc. Company’s
Face to face Investors including securities daily
CICC meeting 2013.8 Hong Kong operations;
meeting companies, funds, etc.
Credit Suisse Face to face Investors including securities (2) The
2013.8 Hong Kong Company’s
meeting meeting companies, funds, etc.
Face to face Investors including securities development
Citibank meeting 2013.8 Hong Kong strategies;
meeting companies, funds, etc.
Standard Chartered Face to face Investors including securities (3) The
2013.8 Hong Kong Company’s
meeting meeting companies, funds, etc.
Guotai Junan Face to face Investors including securities opinion on the
2013.8 Shenzhen changes in the
meeting meeting companies, funds, etc.
Guosen Securities Face to face Investors including securities industry.
2013.9 Shenzhen
meeting meeting companies, funds, etc.
UBS Securities Face to face Investors including securities (II) Major
2013.9 Beijing information
meeting meeting companies, funds, etc.
Face to face Investors including securities provided:
Macquarie meeting 2013.9 Beijing Published
meeting companies, funds, etc.
information
Ping An Securities Face to face Investors including securities
2013.9 Shenzhen including the
meeting meeting companies, funds, etc.
Company’s
CITIC Construction Face to face Investors including securities regular
2013.9 Shenzhen
meeting meeting companies, funds, etc.
reports.
Dongxing Securities Face to face Investors including securities
2013.9 Shanghai
meeting meeting companies, funds, etc.
Daiwa Securities Face to face Investors including securities
2013.9 Hong Kong
meeting meeting companies, funds, etc.
Face to face Investors including securities
CLSA meeting 2013.9 Hong Kong
meeting companies, funds, etc.
Standard Chartered Face to face Investors including securities
2013.9 Singapore
meeting meeting companies, funds, etc.
Note: The above-mentioned meetings included one-on-one meetings, small group meetings and large group
presentation. The Company received or met with investors from over 50 companies.
Shenyin Wanguo, Guotai
Shenzhen, Dongguan,
Junan, Minsheng Securities,
Guangzhou, Foshan,
CITIC Construction,
Zhuhai, Xiamen,
Macquarie, UBS Securities,
Fuzhou, Sanya,
Morgan Stanley, Goldman
Changsha, Shanghai,
During Sachs, CLSA Securities,
Hangzhou, Nanjing, Small
Securities the Daiwa Securities, BOCI,
Wuxi, Ningbo, group or
companies reporting CICC, Credit Suisse, Orient
Wenzhou, Hefei, one-on-one
period Securities, Barclays, CIMB
Beijing, Tianjin,
Securities, Haitong
Shenyang, Dalian,
International, DBS Vickers
Jinan, Wuhan,
(HK) Ltd, Jefferies, BNP,
Chengdu, Chongqing,
Chelsea Securities Limited,
etc.
China Galaxy International
Financial, etc.
Shenzhen, Dongguan, China Merchants Fund,
Guangzhou, Foshan, Bosera Fund, ABC-CA Fund,
Fund and other During Zhuhai, Xiamen, CCB Fund, China AMC,
Small
investment the Fuzhou, Sanya, Harvest Fund, Southern Fund,
group or
companies and reporting Changsha, Shanghai, Dacheng Fund, China Life,
one-on-one
individual investors period Hangzhou, Nanjing, Taikang Life, SWS MU Fund,
Wuxi, Ningbo, Galaxy AMC,
Wenzhou, Hefei, CIMB-Principal Asset
7
Beijing, Tianjin, Management Berhad,
Shenyang, Dalian, Antipodean Advisors,
Jinan, Wuhan, Steadfast Capital, Viking
Chengdu, Chongqing, Global, Lone Pine, Neptune
etc. Investment Managemen,
CIFM, Norges Bank, Capital
International, Blackrock
Investment UK, Morgan
Stanley Investment
Management, PIMCO, Artha
Capital, Tudor Investment,
First State, Lion Global,
Dodge & Cox Funds,
Henderson Global Investors,
Singapore, GSI Bermuda Ltd,
Templeton Emerging
Markets, SAC, Aeris Capital
AG, Clearbridge Advisors
LLC, Hermes Fund Mgrs Ltd,
Old Mutual Asset Mgrs
(South Africa)(Pty) Ltd,
Pioneer Investment Mgmt
Ltd, Tokio Marine Asset
Mgmt Co Ltd, United
Overseas Bank, APG, Invus
Group Ltd, Goldman Sachs
Asset Mgmt, Amiya Capital
LLP, Louis Dreyfus Inv
Group BV, Wellington Mgmt
LLC, Fidelity, Zeal Asset, JF
Asset Management, Invesco,
etc.
4.5.4 Other major events and their explanations
√Applicable □Not applicable
(1) The Company did not provide any funds for use by its controlling shareholder and its related parties, nor did the
Company provide any guarantee to third parties in violation of regulations and procedures.
(2) Corporate bonds of the Company
In 2008, the Company issued secured and unsecured bonds. Both of them bore a fixed interest rate with a 5-year
maturity. The issue size of the secured bonds and unsecured bonds was RMB 3 billion and RMB2.9 billion
respectively. Both corporate bonds were listed on the Shenzhen Stock Exchange with stock code 112005 and
112006 respectively, with stock short names of “08 Vanke G1” and “08 Vanke G2”.
During the reporting period, the Company’s corporate bonds matured, and the Company paid the principal due and
the fifth-year interest payment. “08 Vanke G1” and “08 Vanke G2” were delisted from Shenzhen Stock Exchange
on 29 August 2013.
(3) On 20 March 2013, the Company’s annual general meeting of 2012 authorised the Board to determine the
continuous cooperation with China Resources (Holdings) Co., Ltd. and its connected companies (collectively
“CRH”) within the following scope, including entering into a loan agreement with China Resources Bank of
Zhuhai Co., Ltd., using the funds under China Resources SZITIC Trust Co., Ltd. and Harvest Capital Partners
Limited, and joint investment with China Resources SZITIC Trust Co., Ltd. and Harvest Capital Partners Limited.
The total sum of the loan, the amount of funds to be utilised and the joint investment amount shall not be more
than RMB12.7 billion (i.e. not more than 20% of the Company’s audited net assets value as at the end of 2012).
The granted authority is valid for a period of two years commencing from the date of passing of the relevant
resolution in the annual general meeting.
During the reporting period, the details of cooperation were yet to work out.
(4) Establishment of internal control
As a key pilot company to implement the Basic Internal Control Norms for Enterprises and its implementation
guidelines, the Company continued to adopt a pragmatic internal control approach to establish the internal control
process in a systematic manner.
(5) Change of listing location of domestically listed foreign shares (“B shares”) of the Company and listing on the
main board of The Stock Exchange of Hong Kong Limited (“SEHK”) by way of introduction
On 19 January 2013, the Company announced its Proposal for Change of Listing Location of Domestically Listed
Foreign Shares of China Vanke Co., Ltd. and Listing & Trading on the Main Board of The Stock Exchange of
8
Hong Kong Limited by Way of Introduction. On 4 February, the Proposal was passed at the first extraordinary
general meeting in 2013. On 7 February, the Company received a confirmation letter regarding the processing of
the application for administrative licence issued by China Securities Regulatory Commission. The Company also
received a confirmation letter regarding the relevant matter from the SEHK on 15 February 2013. After the
Company announced its 2012 annual results on 28 February, the Company submitted additional information
including 2012 annual results for its application. The application is currently in progress.
The change of listing location of the Company’s B shares to SEHK is conducive to enhancing the Company’s
visibility, as well as enabling the Company to leverage overseas resources and markets to reinforce the Company’s
core competitiveness.
4.6 Investment in derivatives
√Applicable □Not applicable
In order to limit the risk associated with the fluctuations of interest rate, the
Company entered into an interest rate swap (“IRS”) agreement to hedge
Remarks on risk analysis and management
floating rate foreign currency loan. The Company would charge the
of derivative positions during the reporting
counterparty an interest according to a floating rate, in order to pay the
period (including but not limited to market
floating-rate interest to the original lender, while paying a fixed rate to the
risk, liquidity risk, credit risk, operational
counterparty.
risk and legal risk, etc.)
In terms of the time limit and amount of the foreign currency loan, IRS limits
the risk of fluctuations of interest rate through fixed forward rate.
Change in market price or fair value of the
derivatives invested during the reporting The effect of the change in the IRS value on the Company’s profit and loss
period, as well as the method, related during January to September amounted to RMB(387,926.35). The value of
assumptions and parameters used to the IRS was determined based on the fair value assessed on 30 September
analyze the fair value of derivatives should 2013.
be disclosed
Remarks on whether there has been a
material change in the accounting policy
and accounting measurement principles for
Nil
the Company’s derivatives during the
reporting period as compared with those of
the previous reporting period
The Company’s independent directors are of the view that financial
Special advice on derivative investment
instruments such as IRS prevent the possible loss associated with foreign
and risk control by independent directors,
currency loan in the event of significant fluctuations in interest rate. The
sponsors and financial advisors
relevant arrangement of the Company has been prudent and reasonable.
4.6.1 Derivative positions as at the end of the reporting period
√Applicable □Not applicable
(Unit: RMB)
Contract amount as at the
end of the period as a
Contract amount as Contract amount as
Profit/loss during percentage of the
Type of contracts at the beginning of at the end of the
Jan-Sep 2013 Company’s net assets as at
the year period
the end of the reporting
period
IRS 2,553,798,650.00 2,159,792,400.00 (387,926.35) 2.29%
Total 2,553,798,650.00 2,159,792,400.00 (387,926.35) 2.29%
9
Consolidated income statement
for the three months ended 30 September 2013
2013 2012
Jul.–Sep. Jul.–Sep.
RMB’000 RMB’000
Revenue 20,708,147 14,297,750
Cost of sales (15,542,231) (9,598,753)
Gross profit 5,165,916 4,698,997
Other revenue 101,736 202,279
Other net income 22,179 49,360
Distribution costs (890,568) (866,554)
Administrative expenses (759,680) (771,378)
Other operating expenses 8,679 (71,521)
Profit from operations 3,648,262 3,241,183
Finance costs (476,979) (474,305)
Share of profits less losses of associates 48,346 153,432
Share of profits less losses
of jointly controlled entities 73,385 50,721
Profit before taxation 3,293,014 2,971,031
Income tax (1,151,761) (1,360,337)
Profit for the period 2,141,253 1,610,694
Attributable to:
Equity shareholders of the Company 1,603,914 1,354,802
Non-controlling interests 537,339 255,892
Profit for the period 2,141,253 1,610,694
Basic earnings per share (RMB) 0.15 0.12
Diluted earnings per share (RMB) 0.15 0.12
10
Consolidated statement of comprehensive income
for the three months ended 30 September 2013
2013 2012
Jul.–Sep. Jul.–Sep.
RMB’000 RMB’000
Profit for the period 2,141,253 1,610,694
Other comprehensive income (after tax and
reclassification adjustments)
Exchange differences on translation of financial
statements of overseas subsidiaries 5,754 (54,547)
Available-for-sale securities: net movement in
the fair value reserve 174 -
5,928 (54,547)
Total comprehensive income for the period 2,147,181 1,556,147
Attributable to:
Equity shareholders of the Company 1,609,842 1,300,255
Non-controlling interests 537,339 255,892
Total comprehensive income for the period 2,147,181 1,556,147
11
Consolidated income statement
for the nine months ended 30 September 2013
2013 2012
Jan.–Sep. Jan.–Sep.
RMB’000 RMB’000
Revenue 59,648,956 43,257,310
Cost of sales (43,043,695) (28,896,138)
Gross profit 16,605,261 14,361,172
Other revenue 461,378 597,377
Other net income 55,380 124,047
Distribution costs (2,321,671) (2,104,936)
Administrative expenses (1,990,281) (1,623,066)
Other operating expenses (90,266) (184,567)
Profit from operations 12,719,801 11,170,027
Finance costs (1,155,583) (1,262,686)
Share of profits less losses of associates 247,045 409,913
Share of profits less losses
of jointly controlled entities 262,315 216,760
Profit before taxation 12,073,578 10,534,014
Income tax (4,596,434) (4,387,842)
Profit for the period 7,477,144 6,146,172
Attributable to:
Equity shareholders of the Company 6,160,219 5,079,887
Non-controlling interests 1,316,925 1,066,285
Profit for the period 7,477,144 6,146,172
Basic earnings per share (RMB) 0.56 0.46
Diluted earnings per share (RMB) 0.56 0.46
12
Consolidated statement of comprehensive income
for the nine months ended 30 September 2013
2013 2012
Jan.–Sep. Jan.–Sep.
RMB’000 RMB’000
Profit for the period 7,477,144 6,146,172
Other comprehensive income (after tax and
reclassification adjustments)
Exchange differences on translation of financial
statements of overseas subsidiaries 31,425 (127,920)
Available-for-sale securities: net movement in
the fair value reserve 623 (27,373)
32,048 (155,293)
Total comprehensive income for the period 7,509,192 5,990,879
Attributable to:
Equity shareholders of the Company 6,192,267 4,924,594
Non-controlling interests 1,316,925 1,066,285
Total comprehensive income for the period 7,509,192 5,990,879
13
Consolidated statement of financial position
at 30 September 2013
30 Sep 2013 31 Dec 2012
RMB’000 RMB’000
Non-current assets
Property, plant and equipment 3,433,645 3,132,540
Investment properties 2,080,347 1,714,136
Interest in associates 4,708,238 2,915,844
Interest in jointly controlled entities 4,392,218 4,043,247
Other financial assets 336,262 85,979
Other non-current assets 654,835 879,582
Goodwill 201,690 201,690
Deferred tax assets 3,855,821 3,219,894
19,663,056 16,192,912
Current assets
Inventories 337,823,979 253,622,152
Trade and other receivables 66,867,545 56,988,250
Pledged deposits 1,119,445 1,171,318
Cash and cash equivalents 35,944,113 51,120,224
441,755,082 362,901,944
Current liabilities
Loans and borrowings 38,903,262 35,557,359
Financial derivatives 13,144 25,761
Trade and other payables 285,301,077 215,529,570
Current taxation 5,945,216 8,720,876
330,162,699 259,833,566
Net current assets 111,592,383 103,068,378
Total assets less current liabilities 131,255,439 119,261,290
14
Consolidated statement of financial position
at 30 September 2013(continued)
30 Sep 2013 31 Dec 2012
RMB’000 RMB’000
Non-current liabilities
Loans and borrowings 35,812,363 36,036,070
Deferred tax liabilities 977,240 1,027,055
Provisions 61,276 44,292
Other non-current liabilities 38,021 15,678
36,888,900 37,123,095
NET ASSETS 94,366,539 82,138,195
CAPITAL AND RESERVES
Share capital 11,014,872 10,995,553
Reserves 57,250,766 52,830,001
Total equity attributable to equity shareholders
of the Company 68,265,638 63,825,554
Non-controlling interests 26,100,901 18,312,641
TOTAL EQUITY 94,366,539 82,138,195
15
Consolidated cash flow statement
for the nine months ended 30 September 2013
(Expressed in Renminbi Yuan)
2013 2012
Jan.–Sep. Jan.–Sep.
RMB’000 RMB’000
Operating activities
Cash received from customers 105,225,240 77,182,825
Cash generated from other operating activities 11,980,358 12,501,968
Cash paid to suppliers (96,576,964) (53,534,270)
Cash paid to and for employees (2,873,138) (2,445,782)
Cash paid for other taxes (7,690,660) (8,880,220)
Cash used in other operating activities (13,091,837) (22,763,230)
Cash used in/( generated from) operations (3,027,001) 2,061,291
PRC Corporate Income Tax (“CIT”)
and Hong Kong Profits Tax paid (5,204,358) (3,045,888)
Land Appreciation Tax (“LAT”) paid (3,829,400) (2,505,954)
Net cash used in operating activities (12,060,759) (3,490,551)
Investing activities
Acquisitions of subsidiaries, net of cash acquired
(956,101) (2,065,369)
Investment in associates and jointly
controlled entities (1,773,464) (338,450)
Acquisitions of additional interest in subsidiaries (201,915) (12,000)
Acquisitions of other investments (284,070) (121,043)
Acquisitions of property, plant and equipment (83,850) (112,266)
Net cash flow from disposals of subsidiaries 180,699 -
Proceeds from disposals of property, plant
and equipment 1,074 872
Proceeds from disposals of investments 242,441 4,000
Interest received
333,307 457,101
Dividends received 720,722 164,872
Net cash used in investing activities (1,821,157) (2,022,283)
16
Consolidated cash flow statement
for the nine months ended 30 September 2013
(Expressed in Renminbi Yuan)
2013 2012
Jan.–Sep. Jan.–Sep.
RMB’000 RMB’000
Financing activities
Contributions from non-controlling interests 4,354,994 891,650
Proceeds from bank loans and borrowings
32,196,991 30,520,606
from financial institutions
Proceeds from issuing of corporate bonds 4,850,919 -
Repayment of bank loans and borrowings
from financial institutions (35,526,887) (21,328,939)
Dividends and interest paid (7,127,790) (6,030,771)
Net cash used in/( generated from) financing
activities (1,251,773) 4,052,546
Effect of foreign exchange rate changes (42,422) (14,016)
Net decrease in cash and cash equivalents (15,176,111) (1,474,304)
Cash and cash equivalents at 1 January 51,120,224 33,614,112
Cash and cash equivalents at 30 September 35,944,113 32,139,808
17
