Shenzhen Shenbao Industrial Co., Ltd.
Semi-Annual Report 2011
A u g u s t 2 0 11
1
Contents
CHAPTERI. COMPANY PROFILE-------------------------------------------------------05
CHAPTERII. CHANGES IN SHARE CAPITAL AND PARTICULARS ABOUT
SHARES HELD BY MAIN SHAREHOLDERS------------------------------------------08
CHAPTER III. PARTICULARS ABOUT DIRECTORS, SUPERVISORS AND
SENIOR EXECUTIVES-----------------------------------------------------------------------13
CHAPTER IV. REPORT OF BOARD OF DIRECTORS-------------------------------14
CHAPTER V. SIGNIFICANT EVENTS---------------------------------------------------16
CHAPTER VI. FINANCIAL REPORT (UN-AUDITED)-------------------------------31
CHAPTER VII. DOCUMENTS AVAILABLE FOR REFERENCE-----------------114
2
Important Notice
Board of Directors and Supervisory Committee of Shenzhen Shenbao Industrial Co., Ltd.
(hereinafter referred to as the Company) and its directors, supervisors and senior
executives hereby confirm that there are no any important omissions, fictitious
statements or serious misleading information carried in this report, and shall take all
responsibilities, individual and/or joint, for the reality, accuracy and completion of the
whole contents.
No director, supervisor and senior executive stated that he (she) couldn’t ensure the
correctness, accuracy and completeness of the contents of the Semi-annual Report or
have objection to this report.
All the 9 directors attended the Board of Directors.
Chairman of the Board Mr. Zheng Yuxi, Current General Manager Mr. Yan Zesong,
previous General Manager Mr. Peng Ying and CFO Ms. Zeng Suyan hereby confirm that
the financial report of the semi-annual report 2011 is true and complete.
The 2011 semi-annual financial report of the Company has not been audited.
This report was prepared in both English and Chinese. Should be there any difference in
interpretation of the two versions, the Chinese version shall prevail.
3
Paraphrase
In reporting period, only if the contexts have their special meaning, the following short
forms refer to the following meanings:
Shenshenbao/the
Company/Listed Refers to Shenzhen Shenbao Industrial Co., Ltd
Company
Shenzhen Shenbao Huacheng Technology Co.,
Shenbao Huacheng Refers to Ltd
Wuyuan Jufangyong Refers to Wuyuan County Jufang Tea Industry Co., Ltd
Shenzhen Shenbao Sanjin Food Beverage
Shenbao Sanjing Refers to Development Co., Ltd
Shenbao Technology Refers to Huizhou Shenbao Technology Co., Ltd
Huizhou Shenbao Industrial Investment Co.,
Shenbao Investment Refers to Ltd
Guangdong Shenbao Refers to Guangdong Shenbao Food Co., Ltd
Shenbao Industry and Refers to Shenzhen Shenbao Industry and Trade Co., Ltd
Trade
Shenzhen Shenbao Property Management Co.,
Shenbao Property Refers to Ltd
Shenzhen Shenbao (Liaoyuan) Industry
Shenbao Liaoyuan Refers to Company
Shenzhen PepsiCo Refers to Shenzhen PepsiCo Beverage Co., Ltd
Changzhou Sanjing Refers to Changzhou Sanjing Grease Co., Ltd
Shenzhen Shenbao Real Estate Development
Shenbao Real Estate Refers to Co., Ltd
Shenbao (Xinmin) Food Refers to Shenzhen Shenbao (Xinmin) Food Co., Ltd
Shenzhen Agricultural Products Holding Co.,
Agricultural Products Refers to Ltd
Shenzhen Investment Refers to Shenzhen Investment Controlling Co., Ltd
Controlling
Jitai Company Refers to Shenzhen Jitai Industrial Development Co., Ltd
Shenzhen Zhonghua Bicycle (Group) Holding
Shenzhen Zhonghua Refers to Co., Ltd
Shengrun Company Refers to Guangdong Shengrun Group Holding Co., Ltd
Ms. Lin Yixiang, Mr. Xia Zhenzhong, Ms. Cao
4 related natural people Refers to Lijun, Ms. Zheng Lingna
CSRC Refers to Chia Securities Regulation Commission
Shenzhen Stock Refers to Shenzhen Stock Exchange
Exchange
Shenzhen SRC Refers to Shenzhen Securities Regulation Commission
Shenzhen Municipal People's Government
Shenzhen SAC Refers to State-owned Assets Supervision and
Administration Commission
Shenzhen Exchange Refers to Shenzhen United Property And Share Rights
Union Exchange
Li Xin Da Hua Refers to BDO Li Xin Da Hua CPA Co., Ltd
Article of Association Shenzhen Shenbao
Article of Association Refers to Industrial Co., Ltd
Yuan/yuan’ 0000 Refers to RMB (yuan)/RMB’ 0000
4
Chapter I. Company Profile
I. Basic information
(I). Legal Name of the Company
In Chinese: 深圳市深宝实业股份有限公司(Abbr. 深宝)
In English: SHENZHEN SHENBAO INDUSTRIAL CO., LTD. (Abbr.: SBSY)
(II). Legal Representative: Mr. Zheng Yuxi
(III). Secretary of the Board: Ms Li Yiyan
Securities Affairs Representative: Mr. Zheng Guibo
Liaison Address: Southern part of 23/F, No.26 Educational Technology Building,
Zizhuqidao, 4th Road Zhuzilin, Futian District, Shenzhen
Tel: 0755-82027522
Fax: 0755-82027522
E-mail: lyy@ sbsy.com.cn
E-mail: zhenggb@ sbsy.com.cn
(IV). Registered Address of the Company: Southern part of 20/F, Turret of Education
Technology Building, Zhuzilin, Futian District, Shenzhen
Office Address of the Company: South layer of 20/F, No.26 Turret of Education
Technology Building, Zizhuqidao, 4th Road Zhuzilin, Futian District, Shenzhen (the sign
in the elevator shows 23/F)
Post Code: 518040
Internet Web Site: http://www.sbsy.com.cn
E-mail for investors: shenbao@ sbsy.com.cn
(V). Newspapers Chosen for Disclosing the Information of the Company:
Securities Times, China Securities and Hong Kong Commercial Daily
Internet Web Site for Publishing the Semi-annual Report Designated by CSRC:
http://www.cninfo.com.cn
Place Where the Semi-annual Report is Prepared and Placed: Secretariat of the Board of
Directors
(VI). Stock Exchange Listed with: Shenzhen Stock Exchange
Short Form of the Stock: SHENSHENBAO – A, SHENSHENBAO-B
Stock Code: 000019, 200019
(VII). Other Relevant Information of the Company
1. The initial registration date and place: July 30, 1981, Shenzhen
The changed registration date and place: July 12, 2011, Shenzhen
2. Registration code for business license of corporation: 440301103223954
3. Number of taxation registration: GSDZi 440301192180754
DSDZi 440303192180754
4. Organization Code Certificate: 19218075－4
5. Name of the certified public accountants engaged by the Company:
BDO Li Xin Da Hua Certified Public Accountants Co., Ltd.
Address: 11/F., Tower B, United Plaza, No. 5022, Binhe Av. Futian District, Shenzhen
II. Major financial data and indexes
5
(I)Major financial data and indexes
Increase/decrease
at the end of this
report period
Items Unit 2011-6-30 2010-12-31 compared with
that in period-end
of last year
RM
Total assets 1,165,535,518.18 658,468,839.95 77.01%
B
Owners’ equity attributable RM
to shareholders of the listed 887,292,634.00 325,092,060.80 172.94%
B
company
Shar
Share capital 37.92%
e 250,900,154.00 181,923,088.00
Net assets per share RM
attributable to shareholders B/ 3.54 1.79 97.77%
of the listed Shar
company(RMB/Share) e
Increase/decrease
This report The same in this report
Items Unit period period of last period
(Jan. to Jun.) year year-on-year (%)
RM
Total operating income 139,922,991.06 98,031,142.11 42.73%
B
RM
Operating profit -8,639,594.03 -19,960,777.66 56.72%
B
RM
Total profit 8,733,411.67 -17,168,300.74 150.87%
B
Net profit attributable to RM
shareholders of the listed 4,396,354.98 -18,263,527.21 124.07%
B
company
Net profit attributable to
shareholders of the listed RM
company after deducting -12,866,651.90 -20,565,188.38 37.43%
B
non-recurring gains and
losses
RM
B/
Basic earnings per share 0.0242 -0.1004 124.07%
Shar
e
RM
B/
Diluted earnings per share 0.0242 -0.1004 124.07%
Shar
e
Weighted average return on % 1.34 -5.87 7.21%
equity (%)
Weighted average return on
equity after deducting % -3.93 -6.61 2.68
non-recurring gains and
losses (%)
Net cash flow arising from RM -6,132,118.35 -34.90%
operating activities B -8,272,410.63
RM
Net cash flow per share B/
arising from operating -0.0330 -0.0337 2.18%
Shar
activities e
6
Note: Items of non-recurring gains and losses deducted and the involved amounts are as
following:
Unit: RMB
Items of non-recurring gains and losses Amount
Gains and losses from the disposal of non-current assets -21,707.57
Governmental subsidies included in current gains and loss except for
those who was closely relevant to normal business and conformed to
310,048.00
national rules and those who was offered constantly according to
certain fixed quantity or fixed amount
Expect for effective hedge business relevant to normal operation
business, gains and loss from change of fair value arising from holding
tradable financial assets and tradable financial liabilities as well as -42,000.00
investment earnings from disposal of tradable financial assets, tradable
financial liabilities and financial assets available for sale.
other non-operating income and expenditure excluding the above
17,088,944.71
various items
effect from income tax -82,282.16
effect from minority shareholders’ equity 10,003.90
Total 17,263,006.88
(II) Differences between CAS and IAS
Unit: RMB
Net profit attributable to Owners’ equity attributable to
shareholders of listed company shareholders of listed company
Amount in the Amount in last Amount in the Amount in last
report period period report period period
IAS 4,396,354.98 -18,263,527.21 888,995,232.77 326,794,659.57
CAS 4,396,354.98 -18,263,527.21 887,292,634.00 325,092,060.80
Sub-items and total adjusted based on IAS:
1. Amortization
adjustment of equity --- --- 1,016,958.04 1,016,958.04
investment
difference
2. Cost adjustment
of transferring --- --- -381,359.27 -381,359.27
equity of Shenzhen
Pepsi
3. Other accounts --- --- 1,067,000.00 1,067,000.00
payable adjustment
Total amount of
differences between --- --- 1,702,598.77 1,702,598.77
CAS and IAS
In the first half of year 2011, the net profit attributable to owners of the
parent company calculated based on CAS was not different with the
Explanations on
differences between one calculated basedtheonshareholders’end of reporting period,parent
IAS; at the the
difference between equity attributable to
CAS and IAS company calculated based on CAS wasn’t the one calculated based on
IAS was listed in the above item of adjustment.
7
Chapter II. Changes in Share Capital and Particulars about Main
Shareholders
I. Changes in Shares
(I) Issuance and listing of stock
Approved by ZJXK [2011] No. 777 document of Reply about Approving the Non-Public
Issuing of Stocks of Shenzhen Shenbao Industrial Co., Ltd issued by CSRC, the
Company issued 68,977,066 shares of RMB ordinary share (Stock A) to 8 special
investors with price of 8.7 yuan per share, totally collecting RMB 600,100,474.20. The
net amount of actual raised capital was RMB 572,392,141.89 after deducting RMB
27,708,332.31 of issuing expense. Including, 4 related natural people namely Ms. Lin
Yixiang, Mr. Xia Zhenzhong, Ms. Cao Lijun and Ms. Zheng Lingna subscribed with their
gathering 48.33% equity holding from Shenbao Huacheng while another 4 investors
namely Shenzhen Tianzhong Investment Co., Ltd, Ms. Li Duruo, XinJiang Xiehe Equity
Investment Partner Corporation (limited partner) and Yinfu (Tianjin) Equity Investment
Management Partner Corporation (limited partner) subscribed in cash. Approved by
LXDHYZi [2011] No. 177 document of the Capital Verification Report issued by BOD
China Lixin Dahua CPA Co., Ltd, all the raised capital of this time of non-public issuing
had been paid up on Jun. 23 of 2011, which the Company had deposited them in specific
account. registration and entrust procedure over theses shares had been accomplished in
China Securities Depository and Clearing Co., Ltd. Branch in Shenzhen on Jun. 27 of
2011. On July 1 of 2011, they were registered and on July 4 of 2011 all the newly
increased shares were listed in Shenzhen Stock Exchange. The transfer procedure over
the 48.33% equity of Shenbao Huacheng was handled on June 8, 2011.
(II) Amount of shares and change
On July 12 of 2011, the commercial and industrial procedure over the newly increased
shares was handled thus share capital of the Company became 250,900,154 shares. The
nature of these new shares was restricted current shares. The predicted listing and trading
date of shares subscribed by 4 relevant natural people was July 4 of 2014 while the date
of the shares subscribed by other specific objects was July 4 of 2012. The particulars of
shares held by the 8 specific investors were as follow:
ration in Restrictio
Placing Amount of total shares n
No. Issuing object shares placing after the duration
(share) (yuan) issuing (month)
1 Lin Yixiang 2,561,002 22,280,717.40 1.02% 36
2 Xia Zhenzhong 2,134,917 18,573,777.90 0.85% 36
3 Cao Lijun 2,012,758 17,510,994.60 0.80% 36
4 Zheng Lingna 774,137 6,734,991.90 0.31% 36
115,300,003.8
5 Li Duruo 13,252,874 5.28% 12
0
Shenzhen
Tianzhong 217,359,999.6
6 24,983,908 9.96% 12
Investment Co., 0
Ltd
Xinjiang Xiehe 100,879,997.4
7 Equity Investment 11,595,402 4.62% 12
0
Partner
8
Corporation
(limited partner)
Yinfu (Tianjin)
Equity Investment
Management 101,459,991.6
8 11,662,068 4.65% 12
Partner 0
Corporation
(limited partner)
600,100,474.2
Total 68,977,066 27.49% --
0
Note: remaining of the latter 2 figures after decimal point based on rounded-up arrear
will lead difference between the summation of arrears and collective vale. It is the same
below.
Excluding the above events, in reporting period the Company had no change on total
amount of shares and structure owing to bonus shares, converted new shares, placing
shares, and combination, shares transferred from convertible bonds, capital decrease or
other factors. Till July 1 of 2011, the capital share of the Company was as follow:
(Till end of 1 July 2011) Unit: share
Before the change Increase / decrease this time (+, -) After the change
acc
Bo um
Proporti New shares nus ulat Oth
Amount Subtotal Amount Ratio
on (%) offering sha ion er
res fun
d
I. Restricted
14,553,847 8.00% 68,977,066 --- --- --- 68,977,066 83,530,913 33.29%
shares
1. State-owned
--- --- --- --- --- --- --- --- ---
shares
2. State-owned
legal
6,783,729 3.73% --- --- --- --- --- 6,783,729 2.70%
person's share
s
3. Other
domestic 7,770,118 4.27% 68,977,066 --- --- --- 68,977,066 76,747,184 30.59%
shares
Including:
Domestic
non-state-owne 7,770,118 4.27% 48,241,378 --- --- --- 48,241,378 56,011,496 22.32%
d legal person's
shares
Domestic
natural person's --- --- 20,735,688 --- --- --- 20,735,688 20,735,688 8.26%
shares
4. Foreign
--- --- --- --- --- --- --- --- ---
shares
Including: --- --- --- --- --- --- --- --- ---
9
Foreign legal
person's shares
Foreign natural
--- --- --- --- --- --- --- --- ---
person's shares
5. Executive
--- --- --- --- --- --- --- --- ---
stock
II. Unrestricted
167,369,241 92.00% --- --- --- --- --- 167,369,241 66.71%
shares
1. RMB
Ordinary 141,233,241 77.63% --- --- --- --- --- 141,233,241 56.29%
shares
2.
Domestically
26,136,000 14.37% --- --- --- --- --- 26,136,000 10.42%
listed foreign
shares
3. Overseas
listed foreign --- --- --- --- --- --- --- --- ---
shares
4. Others --- --- --- --- --- --- --- --- ---
Total
unrestricted 181,923,088 100.00% 68,977,066 --- --- --- 68,977,066 250,900,154 100%
shares
Note: the above sheet was complied based on the Share Structure Sheet of Listed
Companies offered by China Securities Registration and Clearing LLC Branch in
Shenzhen. Till July 1 of 2011, the 68,977,066 shares of non-public A Stock issued to the
8 specific investors had been registered.
II. Amount of shareholders of the Company totaled 23,845 in the end of report
period, including 19,282 A shares and 4,563 B shares.
III. Particulars about shares held by top ten shareholders and top ten shareholders
with unrestricted conditions (Ended Jun. 30, 2011)
Unit: Share
Total of shareholders 23,845
Particulars about shares held by the top ten shareholders
In July
1st
accoun
Nature Total Amount of Amount of
ted for
of amount of restricted shares pledged
Full Name of shareholder the
sharehol shares held shares held or frozen
propor
ders ( Share) (share) (share)
tion of
equity
(%)
10
SHENZHEN
AGRICULTURAL Other 19.09 47,895,097 7,770,118 0
RODUCTS CO., LTD.
State-ow
SHENZHEN
ned
INVESTMENT HOLDING 16.00 40,143,586 6,783,729 0
sharehol
CO., LTD.
der
ICBC-Yinhe Yintai
Financing Dividend Other 0.32 799,900 0 0
Securities Investment Fund
Zhou Cuiping Other 0.20 500,000 0 0
Li Wenwei Other 0.20 492,600 0 0
Huang Xiangdong Other 0.19 474,689 0 0
Lai Wei Other 0.15 375,500 0 0
Lu Yongming Other 0.14 345,461 0 0
Chen Chunfeng Other 0.14 341,880 0 0
Zhang Shu Other 0.13 335,631 0 0
Particulars about the shares held by the top ten unrestricted shareholders
Amount of shares of
Full Name of shareholder Type of shares
un-restricted held
SHENZHEN
AGRICULTURAL 40,124,979 A share
RODUCTS CO., LTD.
SHENZHEN
INVESTMENT HOLDING 33,359,857 A share
CO., LTD.
ICBC-Yinhe Yintai
Financing Dividend A share
Securities Investment Fund 799,900
Zhou Cuiping 500,000 A share
Li Wenwei 492,600 A share
Huang Xiangdong 474,689 B share
Lai Wei 375,500 A share
Lu Yongming 345,461 A share
Chen Chunfeng 341,880 A share
Zhang Shu 335,631 B share
11
STATE-OWNED ASSETS SUPERVISION &
ADMINISTRATION COMMISSION OF SHENZHEN
MUNICIPALITY GOVERNMENT directly held 21.52% equities
Explanation on associated
of Agricultural Products and indirectly held 5.22% equities of
relationship or accordant
Agricultural Products, and directly held 100% equities of
action among the top ten
Shenzhen Investment Holdings; except that, it is unknown
shareholders of circulation
whether there exists associated relationship or belongs to
share
accordant actionist regulated by Administration of the Takeover of
Listed Companies among the aforesaid listed other shareholders
or not.
Explanations on stipulated Stipulated period of shares
Shareholders’ names
period of rationed new held
shares held which were
participated by strategic
Naught Naught
investors or general legal
person
IV.Shares held by the top ten restricted shareholders and restricted conditions
(Ended as June 30, 2011)
Unit: Share
Amount
Amount of
Name of the of the
Date to be additional
No. restricted restricted Restricted condition
listed listed
shareholders shares
shares
held
SHENZHEN
AGRICULATURAL
1 7,770,118 7,770,118
PRODUCTS CO.,
LTD.
Note 1 Note 2
SHENZHEN
INVESTMENT
2 6,783,729 6,783,729
HOLDING CO.,
LTD.
Note 1: in the light of commitment Agricultural Products and Shenzhen Investment
Holding made in reform of listing non-tradable shares of listed companies, the amount of
restricted shares of the 2 shareholders were respectively 7,770,118 and 6,783,729,
totalling 14,553,847 taking up 8% of total share capital. While theses shares will keep in
restriction.
Note 2. Agriculture Product and Shenzhen Investment Holdings will comply with laws,
regulations and rules and fulfill statutory committed obligations in process of equity
allocation reform; previous shareholders of non-current share of the Company
Agriculture Product and Shenzhen Investment will sell the holding 6%-8% shares of the
total shares of the Company to the management in three years after implementation of
12
consideration according to the shares holding proportion after capital restructuring, thus
carry out longtime and effective motivation on the management. The above specific
measures and implementation details aiming at equity incentive of management was
researched and made by listed companies according to CSRC Measures for the
Administration of Listed Companies Equity Incentive and related rules of the country,
and it will be implemented after Shenzhen SAC exams and approves it. Circulating terms
of this part shares will be conducted conforming to related rules.
V. Particulars about the controlling shareholder
In the report period, the controlling shareholder of the Company remained unchanged.
Chapter III. Particulars about Directors, Supervisors and Senior
Executives
I. Particulars about the shares held by directors, supervisors, and senior executives
Ended the report period, directors, supervisors, and senior executives of the Company did
not hold the shares of the Company, and there were no changes during the report period.
II. New engagement or dismissal of directors, supervisors, and senior executives
In the report period, the Company did not newly engage or dismiss directors, supervisors,
and senior executives.
On July 1 of 2011, after approval of the 12th meeting of the 7th session of board of
directors, we agreed that Mr. Peng Ying resigned position of General Manager and to
engage Mr. Yan Zesong as General Manager of the Company from the day when the
suggestion passed in this board of directors to the expiration of the 7th board of directors.
(details could been seen from notices on the Securities Times, China Securities Journal,
Hong Kong Commercial Daily and Juchao information website.)
13
Chapter IV. Report of Board of Directors
I. Discussion and analysis of general operation of the Company during the report
period
In reporting period, the Company successively promoted development of core industry
namely tea industry and improved stable operation of traditional industry according to
annual operational plan. Faced with successive price growth of raw material for tea
industry and intensified market competition, we closely traced change on market,
optimized marketing strategy, paid more attention to technology R&D, strictly enhanced
management on products and control and deepened cost control. Thus the Company
validly avoided various unfavorable factors and ensured constant growth in sale of tea
products. Substantial growth of cost of domestic raw material and labor challenged
traditional industry dramatically. But the Company straightly faced the difficulties and
pressure, stably operated, intended for development thus boost stable operation of
various business of the traditional industry.
In reporting period, all the capital raised from non-public issue of A stock had been paid
up. After implementation of projects with raised capitals, the Company will continuously
promote development of tea industry on basis of strategic development goal. And we’ll
vigorously enhance R&D of technology, quality system construction, optimization of
products structure and target management. The Company will focus on improving
production of tea industry and sales scale, and actively explore development; production
and sale of tea material, perfect the tea industrial chain thus effectively boost core
competitiveness and constant profitability of the Company.
(I)Operation income, operation profit and net profit of the Company realized in this
report period
Operation income, operation profit, net profit as well as change year-on-year of the
Company from January to June of 2011:
Unit: RMB
The half year of The half year of Change
Item
2011 2010 year-on-year
Operation income 139,922,991.06 98,031,142.11 42.73%
Operation profit -8,639,594.03 -19,960,777.66 56.72%
Net profit attributable to
4,396,354.98 -18,263,527.21 124.07%
shareholders of listed company
(1)Operating income increased mainly due to sales income of tea products increased by
59.99% over last period;
(2)Operating profit increased mainly due to development of tea industry was in a good
state and sales income increased as well as net profit of Shenzhen PepsiCo decreased
dramatically over last period.
(II)Main business scope and operation status
The business scope included: producing canned food, beverage, native product; domestic
commerce, material supply and marketing; import and export business; the main business
14
of the Company belongs to food & beverage industry. Constitution of operation income
and operation profit is as follows:
1. Main business classified according to industry or product:
Unit: RMB
Increase/
Increase/
Classifie decrease Increase/
decrease
d in decrease
Gross in
accordin Operating Operating operatin in gross
margin operatin
g to revenue cost g margin
g cost
industrie revenue year-on-
year-on-
s year-on- year
year
year
Manufact
121,512,372.2
ure of 97,634,676.57 19.65% 59.99% 62.75% -1.36%
3
teas
Manufact
ure of
6,305,580.74 4,137,187.26 34.39% -22.22% -22.51% 0.24%
condimen
ts
Manufact
ure of soft 11,808,162.02 10,225,257.66 13.41% -13.61% 5.51% -15.69%
drinks
Classifie
d
accordin
g to
products
Tea 121,512,372.2
97,634,676.57 19.65% 59.99% 62.75% -1.36%
products 3
Sanjing
brand
6,305,580.74 4,137,187.26 34.39% -22.22% -22.51% 0.24%
condimen
ts
Soft
packing 11,808,162.02 10,225,257.66 13.41% -13.61% 5.51% -15.69%
drinks
(1)Operating income of tea industry increased mainly due to market demands and sales
volume improved;
(2)Operating income of condiment decreased mainly due to sales volume descended;
(3)Operating income of soft drinks decreased mainly due to constant low temperature
and decreased sales.
(4)Operating income of the above various industries decreased mainly due to cost of raw
material and labor increased.
2. Main business classified according to area
15
Unit: RMB
Change of operation income
Area Operation income
year-on-year
South China 37,039,819.46 18.93%
North China 15,667,889.12 209.61%
East China 52,199,066.56 31.13%
Export -84.51%
432,985.23
Other areas 34,579,754.62 79.88%
Total 139,919,514.99 42.73%
(1)Operating income in South China, Eastern China, Northern China and other regions
increased mainly due to customers in these regions purchased more tea products.
(2)Export amount decreased mainly due to export of Mei tea dramatically decreased.
(III) Explanation for change in profit constitution, main business and its structure,
as well as profit-making ability of main business in the report period
Increase/Decrease
Amount in this Amount in the in this period
Item Explanation
period last period compared to last
period
Sales income of
Operating 139,922,991.06 98,031,142.11 42.73% tea products
income increased
Purchase of raw
material
Operating increased, price
112,209,097.15 75,106,437.05 49.40%
cost of raw material
and cost of labor
increased
Sales income of
tea products in
this period
Sales expense 8,969,300.98 6,310,429.41 42.13% increased, sales
expense
correspondingly
increased
Net profit of
shareholding
enterprise
Investment Shenzhen
-265,249.23 -12,052,068.30 97.80%
income PepsiCo
decreased
dramatically
over last period
Received RMB
1381800 of
divided payment
from Guangdong
Non-operating Shengrun Group
17,433,557.36 2,814,041.99 519.52%
income Holding Co., Ltd
and RMB
2135000 of *ST
Shengrun A
(000030)
16
(IV)There is no other operation activity which brings significant influence upon
profit in the report period.
(V)Particulars about the share-join company from which the investment income
received by the Company influences its net profit over 10%
Shenzhen Pepsi-Cola Beverage Co., Ltd.: a joint stock company of the Company and the
Company holds 25% of its equity; the registration capital of this company amount to
US$ 12,250,000. The company is mainly engaged in manufacturing beverage products of
Pepsi Company, soft drinks of Chinese brands, other carbonic acid and non carbonic acid
beverage, sport articles of Pepsi-cola, as well as stationery articles of Pepsi-cola. And
these are almost produced and sold in Shenzhen, Dongguan, Huizhou, Shantou, and
Meizhou etc. Until the end of this period, the total assets of the company amounted to
RMB 787,270,546.76, 4.32% down compared to the same period of last year; from Jan.
to June, 2011, it realized main business income of RMB 940,550,033.88 and net profit of
RMB -1,078,114.68, respectively 23.41% up and 97.19% up over the same period of last
year.
(VI) Confirmation method, acquirement method, relevant estimation assumption,
model and setting for parameter of fair value
The assets of the Company confirmed by fair value refer to:
1. Attaining 150000 shares of stock of Gaiguoshi because of historic problem (previous
STAQ system purchased)
2. Attaining 2,135,071 shares of stock of *ST Shengrun A in accordance with ruling of
Shenzhen Mediate People’s Court.
The above assets will be calculated as tradable financial asset. In the light of relevant
rules of the Corporation Accounting Rules, the initial confirmation amount for
transactional financial assets is confirmed according to the fair value when they are
acquired, and the relevant expense occurred in the transaction should be recorded into
current gains and losses when transaction happens. On date of balance sheet, for
transactional financial assets, subsequent measures should be calculated according to fair
value, besides, the transaction expense which could occur when disposing the financial
assets should not be deducted. Variance of fair value of transaction financial assets
should be recorded into current gains and losses. (Details of gains and losses of the above
financial asset could be seen from Chapter V. Section IV Securities Investment).
(VII)Problems and countermeasures existed in operation of the Company
Problems existed:
1. Growth of production cost
Natural disaster brought an obvious growth in price of upper-stream raw materials of
manufacturing industry, thus purchase cost increased and profit space was compressed.
Possible measures:
Further deepen control on cost and expense; further optimize purchase management of
raw materials, and perfect supplier’s management mode.
2. Pressure from market
Market competitiveness intensified, thus market maintenance and exploring should be
17
focused on.
Possible measures:
Reinforce system construction of brand culture, stabilize current customers group and
sales channel, put more effort on marketing extension.
3. Return on investment
The successive loss of Shenzhen PepsiCo in the first half year of 2011 made a constant
impact on overall performance of the Company.
Possible measures:
The Company had transferred part of equity of Shenzhen PepsiCo. And then we will
closely pay attention to its production and operation. Based on change on performance,
we’ll adjust investment strategy, and try to promote development of main business and
improve overall performance.
4. Talents reserve
During process of extension of main business, we need a lot of human resource. Thus
rapid reserve and training of human resource is the key subject the Company faces.
Possible measures:
We should enhance construction of team and group, reinforce management of human
resource, and continuously pay attention to talent cultivation and engagement.
II. Investment of the Company
(I) Application of raised proceeds
The Company has not raised proceeds in the report period, nor proceeds raised in
previous period but last to use in this report period.
(II) The Company had no investment with non-raised proceeds in this period.
III. The Company has not made any amend in the operation plan for 2011 which
was disclosed in the Annual Report of 2010.
IV. The Company will timely fulfill the obligation of information disclosure
according to the performance process, such as the accumulated net profit from the
beginning of the year to the next period-end may be a loss and create a huge change
compared to the same period of last year.
V. The Semi-Annual financial report 2011 of the Company was not audited.
Chapter V. Significant Events
I. Corporate Governance
(I) Particulars about government governance
The Company persisted normal operation, constantly perfected and consummated the
governance structure of the Company and enhanced the Company's governance level
strictly in accordance with the requirements of the Company Law, Securities Law, and
Listed Rules of Shares of Shenzhen Stock Exchange, administrative regulations and
relevant standardized documents as well as the rules of Articles of Association.
18
According to standardized documents related to listed companies governance issued by
CSRC, the Board of Directors believed that the Company had built complete governance
structure and governance mechanism of legal person, there was no abnormal operation in
the Company, and the actual condition of the Company governance basically conformed
to the requirements.
(II) Proceedings of standardized system construction of internal control
On Feb. 18 of 2011, Shenzhen SRC issued the Notice to Relevant Working about
Experimental Unit of Normalized Internal Control of Listed Companies in Shenzhen
(SZJGSZi [2011] No. 31) which required that 83 listed companies namely 26 important
companies and 57 experimental companies should begin to implement the Internal
Control Normalization and comprehensively conduct the Basic Rules for Corporation
Internal Control and relevant supporting guidance (hereinafter referred as the Internal
Control Normalization). As one of experimental units, the Company showed high
attention to this and desired to take this opportunity of system construction of internal
control, and to comprehensively improve overall control on internal control and
prevention and anti-risk ability. We want to build long-term management system of
internal control, and successively carry out the following working:
1. We established a special leading group for internal control construction where
president of board of directors is the leader; general manager and president of board of
supervisors are vice-leaders while chargers of various divisions and enterprises are
members of the group. The group was made for being responsible for integration and
direction working such as construction and strategies of internal control system. The
leading group set up subordinate office responsible for specific implementation of daily
contact and working. At the same time, for purpose of actually improving overall internal
control, the Company engaged CAP rich in standardized management experience about
internal control to assist the special group to comprehensively clear internal control and
perfect internal control system of the Company.
2. The Company formulated the Standardized Implementation Program of Internal
Control (hereinafter referred as Implementation Program) which had been reviewed and
passed by the 11th meeting of the 7th session of board of directors. After that, the
Company strictly complied with the fixed Implementation Program, positively promoted
construction of internal control system.
3. In accordance with business traits and applicable business procedure of various
business entities for internal control system construction the Company determined, the
Company determined business procedures of various business entities based on influence
on accuracy, truth and completeness of the compiling of the financial report.
4. The Company recognized and analyzed the existing risks, determined key risks which
should be given most attention and preferential control, and formed risk listing of various
business procedures in accordance with possibility and influence of occurrence of risk.
And then we determined corresponding control goal and activities based on risk listing,
and recognized key controlling activities among them thus compiled and formed matrix
19
of risk control.
5. The Company took various business procedures as unit, carried out business research
and study through interview and spot inspection on chargers of the procedures and
business backbones. We cleared and analyzed internal control of main business
procedures of the Company and various business entities, and recognized the difference
between internal control of business procedures and the Internal Control Standards
through comparison with the Internal Control Standards. We conducted walking test,
estimated validity of design of internal control, complied draft of walking test and
recognizing and summing deficiency in internal control design, through attaining
relevant files and documents about business procedures. We compiled a test model of
internal control and took validity test on key internal control of business procedures.
Finally we summed up deficiency in internal control and formed list of deficiency,
analyzed and recognized key deficiency in internal control.
6. The Company occasionally carried out propaganda and education about normalized
internal control, took basic training about internal control and practice training on
executives and business backbones, and insisted on advertisement of internal control.
And then we further improved awareness of internal control and risk of relevant
personnel through conclusion of working about internal control.
In reporting period, the Company accomplished business procedures description, risk
control matrix, walking test, test model about execution validity and selection rule on
samples as well as compiling and walking test on separation sheet about incompatible
responsibility and description of business procedures. We completed compiling of
procedure about validity test, recognized and summed up deficiency in internal control of
the Company. In the subsequent working, the Company stably promoted system
construction of internal control strictly in accordance with requirements of the Notice to
Relevant Working about Experimental Units of Normalized Internal Control of Listed
Companies in Shenzhen (SZJGSZi [2011] No. 31) and the Implementation Program.
II. Implementation of profit distribution plan, common reserves capitalizing plan or
new shares issuing plan in the report period
The Company did not have profit distribution plan, common reserves capitalizing plan or
new shares issuing plan which were made in the past years and implemented in the report
period. The Annual Shareholders' General Meeting 2010 decided that the Company
neither implements profit distribution, nor transfer capital public reserve into share
capital. (Details could be found in Resolution Notice of Annual Shareholders' Meeting
2010 published in Securities Times, China Securities Journal, Hong Kong Commercial
Daily and Juchao Website dated May 21, 2011.)
In the first half year of 2011, the Company neither implements profit distribution, nor
transfer capital public reserve into share capital.
III. Lawsuits and Arbitrations
(I) The case concerning the joint-liability guarantee the Company provided for the RMB
20
7 million loan that Shenzhen China Bicycle Company (Holdings) Limited (hereinafter
referred to as Shen China) had got from China Construction Bank Shenzhen Branch
(hereinafter referred to as Construction Bank) has been closed with a reconciliation. In
the year 2003, the Company and Construction Bank reached the Agreement on Interest
Reduction and Cancellation, and according to the agreement, the Company had already
paid back the RMB 7 million in two times for Shen China and fulfilled its guarantee
liability (for details, please refer to Annual Report 2003 of the Company.); through the
verdict of (1999) YFJYZZi No. 26 Civil Judgment Document made by Guangdong High
People’s Court on the case concerning the joint-liability guarantee amounting to USD 0.8
million the Company provided for issue of Letter of Credit Shen China had applied for at
Bank of China Shenzhen Branch, the Company should shoulder joint repayment liability.
And ended the first half year of 2004, the Company had repaid RMB 6,631,600
(amounting to USD 0.8 million) for Shen China and fulfilled the guarantee responsibility
(for details, please refer to Semi-Annual Report 2004 of the Company.). Latter, on Jul. 22,
2004, the guarantee payment, which the Company had paid on its behalf, was enforced to
conduct by Shenzhen Intermediate People’s Court that the Company applied to.
To safeguard the rights and interests of the Company, the Company sued Shen China to
Shenzhen Intermediate People’s Court, and requested for a verdict to order Shen China to
repay RMB 7 million, which the Company had paid on its behalf, as well as to
compensate relevant loss arising from the capital occupancy in 2004. Shenzhen
Intermediate People’s Court judged and ordered Shen China to repay the RMB 7 million
the Company had paid on its behalf, and the interest arising during the period of capital
occupancy [(2004) SZFMECZi No.448]. Since Shen China had not fulfilled its
repayment duty according to the time and contents stipulated in the judgment document,
the Company applied to Shenzhen Intermediate People’s Court on Dec.20, 2004 for
compulsory enforcement. Shenzhen Intermediate People’s Court sent Shen China (2004)
SZFZZi No.1382 Civil Verdict and Mandamus, as well as (2005) SZFZZi No.208 Civil
Verdict and Mandamus on Jan.14, 2005, and ruled that the property of Shen China (RMB
14,131,575.92 as the limit) should be sealed up and frozen, and that Shen China should
fulfill the duties stipulated in effective legal papers or regulated by law within five days
from the day the Mandamus arrived. Should Shen China defaulted beyond the time limit,
Shenzhen Intermediate People’s Court would make compulsory enforcement according
to law (for details, please refer to notifications of the Company published on Securities
Times, Hong Kong Commercial Daily and Juchao Website dated Jul.30, 2004, Nov.20,
2004, Dec.16, 2004, Dec.29, 2004 and Jan.18, 2005.). Later, stipulated by the Higher
People’s Court of Guangdong, the aforesaid two lawsuits were conducted by Guangzhou
Railway Transportation Court, and the conductions were suspended in the report period
because of discovering no property clues. As soon as circumstances of execution
suspension ended, the Company may apply to Guangzhou Railway Transportation Court
for resumption of execution. The Company will exercise related rights by legal means.
(II) Lawsuits between the Company and Guangdong Sunrise Holdings Co., Ltd.
Lawsuits arising from joint liabilities guarantee the Company offered for Guangdong
Sunrise Holdings Co., Ltd. (the former Shenzhen Lionda Holdings Co., Ltd. hereinafter
21
referred to as Sunrise Company for short) referred to historic remaining guarantees
before 1999 the company and Shengrun Company were both controlled subsidiaries of
Shenzhen Investment Management Company. Details are as follow:
1. “Guarantee Contract” was entered into by the Company and Futian Sub-branch of
Shenzhen ICBC on 30 December 1998 for jointly liability of HK$3 million loans to
Shengrun Company from the Company.
2. “Guarantee Contract for Loans” was entered into by the Company and Nantou
Sub-branch of SDB on 30 June 1999 for jointly liability of HK$6 million loans to
Shengrun Company from the Company.
3. “Borrowing Contract” was entered into by the Shengrun Company and Nantou
Shenzhen branch of BOC on 31 December 1998 for HK$32 million borrowings; the
Company provided jointly liability for the aforesaid loans.
4. “Guarantee Contract” was entered into by the Company and Nanyuan Sub-branch of
GDB on 23 June 1999 for jointly liability of 8 million yuan loans to Shengrun Company
from the Company.
The possible losses arising from the above joint liability guarantee had been totally
accrued in 2007.
On Apr. 14 of 2010, Shenzhen Intermediate People’s Court (hereinafter referred to as
Shenzhen Zhongyuan) accepted application about restructure on Shengrun Company
raised up by Shenzhen Xingyaju Decoration Project Co., Ltd, and on May 5 of 2010
made the (2010) SZFMQCZZ No. 5-2 Civil Ruling which ruled that: since May 6 of
2010 the restructure on Shengrun Company could be started. According to relevant
requirements of application of creditors’ right, the Company applied creditors’ right to
managers of Shengrun Company as for accounts such as compensation principal and
relevant interest the above 4 guarantee cases concerned in Jun. of 2010.
In Sep. of 2010, the Company received the (2010) SZFMQCZZ No. 5-2 Civil Ruling
made by Shenzhen Zhongyuan which finally ruled that: confirmed the Creditors’ Right
Sheet on Restructure Plan of Guangdong Shengrun Group Holding Co., Ltd submitted by
managers of Shengrun Company on Aug. 13 of 2010 which confirmed 38 creditors with
equivalent RMB 2,063,084,247.96. They were all ordinary creditors’ right. The
Creditors’ Right Sheet on Restructure Plan of Guangdong Shengrun Group Holding Co.,
Ltd confirmed the creditors’ right on Shengrun Company was RMB 62,150,928.20.
(Details could be seen from Securities Times, China Security Journal, Hong Kong
Commercial Daily and Juchao website dated on Sep. 9 of 2010).
In Oct. of 2010, creditors of Shengrun Company held meeting which passed the Draft of
Restructure Plan of Guangdong Shengrun Group Holding Co., Ltd. According to
restructure plan of Shengrun Company, it is predicted that monetary discharge proportion
of ordinary creditors’ right was 2.16% and shares discharge proportion was 27.89%, thus
ordinary creditors could got 30.05% discharge totally. Till issuing date of this report, the
Company received discharge account RMB 1,381,832.66 and 2,135,071 A shares from
*ST Shengrun. (Details could be seen from Securities Times, China Security Journal,
Hong Kong Commercial Daily and Juchao website dated on Apr. 9 of 2011).
IV. Equity investment
22
Proportion
Gain/lo
Amount in total
Initial Book value ss of
Stock Stock Short form held at securities
No. investme at the end of the
category Code of stock period-en investmen
nt period report
d (shares) t at end of
period
period (%)
Stock (3rd 400005 Haiguoshi 272,288.0
1 150,000 262,500 1.49 -42,000
board) 9
*ST
17,334,869.
2 Stock 000030 Shengrun 0.00 2,135,071 98.51 0.00
55
A
Other stock investment held at the end of
— — — — —
report period
Gain/loss of disposed stock investment in
— — — — —
the report period
Total 272,288.0 17,597,369.
— 100% -42,000
9 55
In the report period, the Company had neither shareholding the equities of financial
enterprises such as other listed company, commercial bank, Securities Company,
insurance company, entrusted company and Futures Company, nor investment situations
such as shareholding the company which plans to be listed in stock exchange.
V. Material purchases, sales or disposal of assets
(I) There were no material purchases, sales or disposal of assets in the report period
(II) Planning to sell 15% equity of Shenzhen PepsiCo
After reviewing and approval of the 13th meeting of the 7th session of board of directors
held on July 19 of 2011, the Company planned to sell 15% equity of Shenzhen PepsiCo.
In the light of financial data of 2010, audited operating income of Shenzhen PepsiCo was
RMB 1569601300 while that recorded in consolidation statement of the Company was
RMB 229797400. Owing to it hasn’t reached 12 years since the Company sold 5% equity
of PepsiCo in Dec. of 2010, 20% equity of Shenzhen PepsiCo equaled to 136.61% in
audited operating income over the same period of the Company.
15% equity of PepsiCo was listed and sold in Shenzhen Exchange Union with listing
price RMB 144 million. The final transaction parties and transaction price can be
determined after being public listing and dealing in Shenzhen Exchange Union. There
exists still uncertainty in that the Company could find applicable accepters for the
significant asset sale through Shenzhen Exchange Union.
When the accepter and specific trading price were determined and audit of the targeted
asset was completed, the Company should hold board of directors and shareholders’
meeting again to review relevant proposals of significant asset sale.
Specific program about the equity transfer and audited financial data will be disclosed in
report of significant asset sale. The significant asset sale could be implemented only
when foreign business department of Shenzhen PepsiCo and CSRC and other approval
institution approved the program. There exists uncertainty whether the program is
23
approved or not.
VI. Significant related transactions in the report period.
In reporting period, events about significant related transaction of the Company are as
follow:
Approved by ZJXK [2011] No. 777 document of Reply about Approving the Non-Public
Issuing of Stocks of Shenzhen Shenbao Industrial Co., Ltd issued by CSRC, the
Company issued 68,977,066 shares of RMB ordinary share (Stock A) to 8 special
investors with price of 8.7 yuan per share, totally collecting RMB 600,100,474.20. The
net amount of actual raised capital was RMB 572,392,141.89 after deducting RMB
27,708,332.31 of issuing expense. Including, 4 related natural people namely Ms. Lin
Yixiang, Mr. Xia Zhenzhong, Ms. Cao Lijun and Ms. Zheng Lingna subscribed with their
gathering 48.33% equity holding from Shenbao Huacheng while another 4 investors
namely Shenzhen Tianzhong Investment Co., Ltd, Ms. Li Duruo, XinJiang Xiehe Equity
Investment Partner Corporation (limited partner) and Yinfu (Tianjin) Equity Investment
Management Partner Corporation (limited partner) subscribed in cash. Approved by
LXDHYZi [2011] No. 177 document of the Capital Verification Report issued by BOD
China Lixin Dahua CPA Co., Ltd, all the raised capital of this time of non-public issuing
had been paid up on Jun. 23 of 2011, which the Company had deposited them in specific
account. registration and entrust procedure over theses shares had been accomplished in
China Securities Depository and Clearing Co., Ltd. Branch in Shenzhen on Jun. 27 of
2011. On July 1 of 2011, they were registered and on July 4 of 2011 all the newly
increased shares were listed in Shenzhen Stock Exchange. The transfer procedure over
the 48.33% equity of Shenbao Huacheng was handled on Jun. 8 of 2011.
As for the non-public issuing, Mr. Yan Zesong once took post of supervisor in the
Company from Oct. 25 of 2006 to Dec. 29 of 2009, and Ms. Lin Yixiang, Mr. Xia
Zhenzhong and Ms. Cao Lijun are close relatives of Mr. Yan Zesong. Including, Mr. Xia
Zhenzhong and Ms. Cao Lijun are couples. Besides, Ms. Zheng Lingna and Mr. Yan
Zesong are partners. So based on relevant rules of the Stock Listing Rules issued by
Shenzhen Stock Exchange, Ms. Lin Yixiang, Mr. Xia Zhenzhong, Ms. Cao lijun and Ms.
Zheng Lingna are natural people and have related relationship with the Company. Thus
deed that the Company purchased 48.33% equity of Shenbao Huacheng from the 4
related natural people with capital raised from non-public stock issue formed a
significant related transaction.
Independent opinion of independent directors on this related transaction:
(I) Related transaction concerning this time of non-public issuance of stock conducted
legal granting procedure. The related transaction plan conformed to interest of the
Company, which won’t hurt interests of non-related shareholders especially middle and
small shareholders.
(II) In process of assets assessment on target equity, assessment institution was
independent, the supposed premise and conclusion of assessment were rational, and
assessment method was applicable.
(III) After completion of non-public issuance of stock, we'll wholly control Shenbao
Huacheng, enhance profitability of the Company, and thus benefit the long-term
24
development of the Company, conforming to interests of all the shareholders and the
Company. So we agreed this non-public issuance plan.
VII. Material contracts and the implementation
(I) The Company had not kept as custody contracted and leased assets of other
companies in the report period or happening in previous period but lasting to this
report period, or vice visa.
(II) Guarantee
Till the end of the report period, all the guarantees of the Company referred to those for
controlled subsidiaries, the Company totally provided guarantee of RMB 50.3237 million
for holding subsidiaries, taking up 5.67% of the net assets at the end of the report period.
There existed no particulars about offering guarantee for shareholders, actual controller
and related parties. Details were as follows:
Unit: RMB’ 0000
Guara
Relationshi Guaran
Name of unit ntee Starting Ending
Guarantor p with the tee
guaranteed amou date date
Company method
nt
Shenzhen
Shenzhen
Shenbao Joint
Shenbao Holding 2010-10 2011-10
Huacheng 2,000 responsi
Industrial Co., subsidiary -21 -21
Technology bility
Ltd
Co., Ltd.
Shenzhen
Shenzhen
Shenbao Joint
Shenbao Holding 2011-01 2011-12
Huacheng 1,000 responsi
Industrial Co., subsidiary -26 -26
Technology bility
Ltd
Co., Ltd.
Shenzhen
Shenzhen
Shenbao Joint
Shenbao Holding 2011-01 2011-12
Huacheng 532.37 responsi
Industrial Co., subsidiary -26 -26
Technology bility
Ltd
Co., Ltd.
Shenzhen
Shenzhen
Shenbao Joint
Shenbao Holding 2011-05 2012-05
Huacheng 1,500 responsi
Industrial Co., subsidiary -26 -26
Technology bility
Ltd
Co., Ltd.
(III) The Company had no entrusted financing in the report period.
VIII. Commitment Issues
Imple
Commitments Promisee Content of commitments menta
tion
Commitments Shenzhen Commitments made by the original Abided
25
for Share Agricultural non-tradable shareholders in the process of by the
Merger Reform Products Co., Share Merger Reform: 1. Shenzhen commi
Ltd. and Agricultural Products Co., Ltd. and Shenzhen tments
Shenzhen Investment Holdings Co., Ltd. will obey the
Investment laws, statutes and regulations, and perform the
Holdings statutory commitment obligations in the
Corporation process of Share Merger Reform; 2.Carrying
out an effective and long-term encouragement
to the management level, after the completion
of share merger reform, Shenzhen Agricultural
Products Co., Ltd. and Shenzhen Investment
Holdings Co., Ltd., the original non-tradable
shareholders of the Company, will sell their
possessed shares in 3 year to the management
team of the Company according to their share
holding proportion after the share merger
reform, which took up 6%-8% of the
Company’s total capital shares after the
implementation of pricing.
The aforesaid encouragement specific
measures and rules for implementation for the
management level was studied and formulated
by listed company according to The Measures
Governing Equity Incentive Plans of Listed
Companies of CSRC and national relevant
regulations, and were reported to the
State-owned Assets Supervision and
Administration Commission of Shenzhen
Municipality Government for examination and
approval and then implementation. The
circulation condition of this part of shares will
be implemented following relevant provisions.
Both of Agriculture Products Co. and
Investment Holdings Co. have been fulfilling
their statutory responsibilities for their
commitments. According to Trial Provisions
for Implementing Stock Option Incentive in
State-owned Controlling Listed Companies
(Domestic) issued jointly by State-owned
Assets Supervisory & Administration
Committee and the Ministry of Finance dated
December 6, 2006, the Company should detail
its stock option incentive plan for
management executives according to relevant
regulations. The non-tradable share holders
will push forward the implementation of stock
option incentive plan for executives within the
range allowed by relevant national laws and
regulations and in appropriate market
situation.
Commitments
made in
Acquisition
Report or —— —— ——
Reports on
Change in
Interests
Commitments —— —— ——
26
made in
Material Assets
Reorganization
Commitments —— —— ——
made in issuing
Other
commitments
(including —— —— ——
additional
commitments)
IX. Punishment and Reform of the directors, supervisors, executives as well as
actual controller of the Company in the report period
In the report, none of the directors, supervisors, executives as well as actual controller of
the Company was investigated, administrative punishment, criticized publicly by China
Securities Regulatory Commission, or publicly condemned by the Stock Exchange.
X. Special explanation and independent opinion on capital occupation of associated
parties and external guarantee of the Company issued by the independent directors:
According to Code of Corporate Governance for Listed Companies in China, Guidelines
for Independent Director of Listed Company Director of Listed Company, Notice
Concerning Some Issues on Regulating the Funds between Listed Companies and
Associated Parties and Listed Companies’ Provision of Guaranty to Other Parties and the
Articles of Association, as independent directors of the 6th Board of Shenzhen Shenbao
Industrial Co., Ltd., we made careful examination and check on the accumulative and
current capital occupation of associated parties and external guarantee as of Jun. 30,
2011, and checked the relevant content of the 2011 Semi-annual Report of the Company.
Now we present the special opinion and independent opinion as follows:
I. Special explanation
(I)During the report period, no controlling shareholder and other associated parties
occupies the capital of the Company, nor does that situation exists which happened in
previous periods lasted to this report period.
(II)Guarantee of the Company in the report period:
1 .Guarantees for holding subsidiaries
Till Jun. 30, 2011, the Company totally provided guarantee of RMB 50.3237 million for
holding subsidiaries, taking up 5.67% of the Company’s net assets. Details were as
follows:
Unit: RMB’0000
Name of Relationsh Guarant
Guarant unit Starting Ending Guarantee
guarante ipCompany amount
with the ee
or date date method
ed
Shenzhen
Shenzhen Shenbao Joint
Shenbao Huacheng Holding 2010-10- 2011-10- responsibili
2,000
Industrial Technolo subsidiary 21 21 ty
Co., Ltd. gy Co.,
Ltd.
27
Shenzhen
Shenzhen Shenbao Joint
Shenbao Huacheng Holding 2011-01- 2011-12-
1,000 responsibili
Industrial Technolo subsidiary 26 26 ty
Co., Ltd. gy Co.,
Ltd.
Shenzhen
Shenzhen Shenbao Joint
Shenbao Huacheng Holding 2011-01- 2011-12-
532.37 responsibili
Industrial Technolo subsidiary 26 26 ty
Co., Ltd. gy Co.,
Ltd.
Shenzhen
Shenzhen Shenbao Joint
Shenbao Huacheng Holding 2011-05- 2012-05-
1,500 responsibili
Industrial Technolo subsidiary 26 26 ty
Co., Ltd. gy Co.,
Ltd.
II. Independent opinion
(I)No controlling shareholder and other associated parties occupy the capital of the
Company.
(II) Decision and approval process of external security of the Company were lawful,
reasonable, and fair.
(III)The Company fulfills its obligation in time for information disclosure on external
guarantee.
(IV)The guarantee the Company provided for its holding subsidiaries was a necessary
and rational measure adopted by the Company for normal operation of its production and
operation activities. It was in line with the principle of maintaining the most interest of
the Company. No interest of the Company and its shareholders, especially the middle and
minor shareholders was hurt.
XI. Till the end of this report period, there was no commitment on restricted shares,
such as voluntarily postponing restricted term, setting or raising the lowest price for
decreasing holding, claimed by the shareholders holding over 5% equity of the
Company.
XII. There was no other event which had significant impact on the Company in the
reporting period
XIII. Accepting of investigations, communication and interview of the Company in
the report period
Reception time Reception Reception Reception Main contents discussed and
place method object offered material
Discussed particulars of
Hangzhou production and operation,
Meeting Galaxy strategy plan of the Company
room of Field Investment as well as prospect of
2011-5-9 the research Management investment by funds raised
Company Consulting about specialized additional
Co., Ltd. issue plan; the Company
didn’t disclose, reveal and
28
leave out significant
information to receipt object.
Soochow
Fund
Management
Co., Ltd.,
China Discussed particulars of
International production and operation,
Fund strategy plan of the Company
Management
Meeting as well as prospect of
Co., Ltd.,
room of Field investment by funds raised
2011-5-23 Guotai
the research about specialized additional
Junan
Company issue plan; the Company
Securities, didn’t disclose, reveal and
Guotai leave out significant
Fund, information to receipt object.
Shanghai
Zexi
Investment
Management
Co., Ltd.
Discussed particulars of
production and operation,
strategy plan of the Company
Wuhan
Meeting Technology asinvestment asby prospectraisedof
well
room of Field
2011-6-2 Innovation about specializedfundsadditional
the research Investment issue plan; the Company
Company Co., Ltd didn’t disclose, reveal and
leave out significant
information to receipt object.
Discussed particulars of
production and operation,
strategy plan of the Company
Meeting China as well as prospect of
room of Field International investment by funds raised
2011-6-3 the research Financial about specialized additional
Company Co., Ltd issue plan; the Company
didn’t disclose, reveal and
leave out significant
information to receipt object.
The Company and relevant obligor of information disclosure strictly accorded with the
requirements of Index of Listed Company’s Equal Information Disclosure of Shenzhen
Stock Exchange, and followed the principle of equal information disclosure, without any
behavior violating equal information disclosure.
XIV. Index of other significant events
No. of Issues of notice Name of newspaper and page Date
notice
Notice of performance China Securities B21; Securities
2011-01 prediction of the Times D21; Hong Kong 2011.1.28
Company Commercial Daily A10
2011-02
B7;
Notice of the Board of China Securities Hong Securities
Times B20; Kong 2011.4.9
Directors Commercial Daily A16
29
Express news about China Securities B12; Securities
2011-03 2010 Annual Times D30; Hong Kong 2011.4.15
Performance Commercial Daily A5
Express News to the 1st China Securities B12; Securities
2011-04 seasonal performance of Times D30; Hong Kong 2011.4.15
2011 Commercial Daily A5
Notice to the 11thth China Securities B62; Securities
2011-05 meeting of the 7 Times D40; Hong Kong 2011.4.29
session of board of Commercial Daily B15
directors
Notice toth decision made China Securities B62; Securities
2011-06 inth the 6 meeting of the Times D40; Hong Kong 2011.4.29
7 session of board of Commercial Daily B15
supervisors
2011-07 Summary of 2010 China Securities B61; Securities
Times D40; Hong Kong 2011.4.29
annual report Commercial Daily B11
2011-08
62;
Notice to change on China Securities Hong Securities
Times D40; Kong 2011.4.29
accounting policy Commercial Daily B15
Notice to holding 2010 China Securities B62; Securities
2011-09 annual shareholders’ Times D40; Hong Kong 2011.4.29
meeting Commercial Daily B15
2011-10 Full text of 2011 the 1st China Securities B61; Securities
Times D40; Hong Kong 2011.4.29
seasonal report Commercial Daily B15
Notice to Suspension of
non-public issue of A China Securities B8; Securities
2011-11 stock because approval Times D25; Hong Kong 2011.5.6
commission of CSRC Commercial Daily A21
approved the item
Notice to application for
approval of approval China Securities B2; Securities
2011-12 commission of CSRC Times D8; Hong Kong Commercial 2011.5.9
on non-public issue of Daily A22
A stock
Notice to decision made China Securities B2; Securities
2011-13 on 2010 annual Times B7; Hong Kong Commercial 2011.5.21
shareholders’ meeting Daily A5
Notice to approval of China Securities A30; Securities
2011-14 non-public issue by Times D4; Hong Kong Commercial 2011.5.27
CSRC Daily A4
Notice to relevant China Securities A24; Securities
2011-15 commitments about Times D6; Hong Kong Commercial 2011.7.1
non-public issue Daily A27
Notice to report and
2011-16 listing of the non-public Juchao information website 2011.7.1
issue stock
Notice to report and China Securities A24; Securities
2011-17 listing of the non-public Times D6; Hong Kong Commercial 2011.7.1
issue stock (summary) Daily A27
Notice to simple change China Securities A24; Securities
2011-18 on equity of the Times D6; Hong Kong Commercial 2011.7.1
Company Daily A28
Notice to simple change China Securities A24; Securities
2011-19 on equity of the Times D6; Hong Kong Commercial 2011.7.1
Company Daily A28
The above information were also all published in Juchao information website (http: // www.cninfo.
com. cn).
30
Chapter VI Notes to Accounting Statements for Semi-annual
Report of 2011
Section I. Financial Statement
Unless otherwise specified, RMB is used for record
Consolidated Balance Sheet for Shenzhen Shenbao Industrial Co., Ltd.
Assets Note V 2011-6-30 2011-1-1
Current assets:
Monetary funds (I) 587,792,262.16 60,540,179.32
Transactional financial assets (II) 17,597,369.55 304,500.00
Notes receivable - -
Account receivable (III) 45,930,990.59 60,924,949.75
Account paid in advance (IV) 5,213,825.94 6,545,149.29
Interest receivable - -
Dividend receivable - -
Other receivables (V) 19,140,659.59 56,556,386.04
Inventories (VI) 56,557,726.07 53,165,409.41
Non-current asset due within one year - -
Other current assets - -
Total current assets 732,232,833.90 238,036,573.81
Non-current assets:
Finance asset available for sales - -
Held-to-maturity investment - -
Long-term account receivable - -
Long-term equity investment (VII) 63,911,629.91 65,976,879.14
Investment real estate - -
Fixed assets (VIII) 150,928,519.89 154,620,846.11
Construction in progress (IX) 11,167,666.37 7,513,353.21
Engineering material - -
Disposal of fixed asset - -
Productive biological asset (X) 270,016.00 242,021.00
Oil and gas asset - -
Intangible assets (XI) 202,399,937.74 187,367,943.21
Expense on Research and
- -
Development
Goodwill - -
Long-term expenses to be apportioned (XII) 2,029,681.04 2,115,990.14
Deferred income tax asset (XIII) 2,595,233.33 2,595,233.33
Other non-current asset - -
Total non-current asset: 433,302,684.28 420,432,266.14
Total assets 1,165,535,518.18 658,468,839.95
Principal of the Company: Zheng Yuxi
Person in Charge of Accounting Works: Zeng Suyan
Person in Charge of Accounting Institution: Wang Zhiping
31
(Cont’)Consolidated Balance Sheet for Shenzhen Shenbao Industrial Co., Ltd.
Liability & Shareholders’ equity NoteV 2011-6-30 2011-1-1
Current liabilities:
Short-term loans (XV) 85,000,000.00 62,400,000.00
Transaction financial liabilities - -
Notes payable - -
Accounts payable (XVI) 21,188,555.41 38,992,403.72
Accounts received in advance (XVII) 1,531,203.73 2,150,632.12
Wage payable (XVIII) 1,723,341.49 3,298,879.27
Taxes payable (XIX) 2,015,764.66 4,651,110.52
Interest payable - -
Dividend payable (XX) 2,909,182.74 2,909,182.74
Other accounts payable (XXI) 78,331,778.72 77,081,960.91
Non-current liabilities due within 1
(XXII) 57,500,000.00 66,500,000.00
year
Other current liabilities (XXIII) 1,993,137.43 493,137.43
Total current liabilities 252,192,964.18 258,477,306.71
Non-current liabilities:
Long-term loans (XXIV) 26,000,000.00 27,000,000.00
Bonds payable - -
Long-term account payable - -
Special accounts payable - -
Projected liabilities - -
Deferred income tax liabilities - -
Other non-current liabilities (XXV) 49,920.00 49,920.00
Total non-current liabilities 26,049,920.00 27,049,920.00
Total liabilities 278,242,884.18 285,527,226.71
shareholders’ equity
share capital (XXVI) 250,900,154.00 181,923,088.00
Capital public reserve (XXVII) 568,700,222.51 79,873,070.29
Less: Inventory shares - -
Reasonable reserve - -
Surplus public reserve (XXVIII) 32,464,033.34 32,464,033.34
Provision of general risk - -
Retained profit (XXIX) 35,228,224.15 30,831,869.17
Balance difference of foreign
- -
currency translation
Total shareholder’s equity
887,292,634.00 325,092,060.80
attributable to parent company
Minority interests 47,849,552.44
Total shareholder’s equity 887,292,634.00 372,941,613.24
Total liabilities and shareholder’s
1,165,535,518.18 658,468,839.95
equity
Principal of the Company: Zheng Yuxi
Person in Charge of Accounting Works: Zeng Suyan
Person in Charge of Accounting Institution: Wang Zhiping
32
Consolidated Profit Statement for Shenzhen Shenbao Industrial Co., Ltd.
Item NoteV Jan.-June of 2011 Jan.-June of 2010
I. Total operating income 139,922,991.06 98,031,142.11
Including: Operating income (XXX) 139,922,991.06 98,031,142.11
II. Total operating cost 148,255,335.86 106,079,351.47
Including: Operating cost (XXX) 112,209,097.15 75,106,437.05
Operating tax and extras (XXXI) 896,845.51 431,774.87
Sales expenses (XXXII) 8,969,300.98 6,310,429.41
Administration expenses (XXXIII) 21,699,521.40 19,691,446.28
Financial expenses (XXXIV) 4,550,650.77 4,543,914.84
Losses of devaluation of asset (XXXV) (70,079.95) (4,650.98)
Add: Changing income of fair value(Loss
(XXXVI) (42,000.00) 139,500.00
is listed with “-”)
Investment income (XXXVII) (265,249.23) (12,052,068.30)
Including: Investment income on
(265,249.23) (12,550,001.25)
affiliated company and joint venture
III. Operating profit (8,639,594.03) (19,960,777.66)
Add: Non-operating income (XXXVIII) 17,433,557.36 2,814,041.99
Less: Non-operating expense (XXXIX) 60,551.66 21,565.07
Including: Disposal loss of non-current
60,551.66 15,050.02
asset
IV. Total Profit 8,733,411.67 (17,168,300.74)
Less: Income tax expense (XL) 1,674,051.00 53,230.14
V. Net profit 7,059,360.67 (17,221,530.88)
Incl: Net profit from mergered before
- -
consolidated
Net profit attributable to shareholder’s of
4,396,354.98 (18,263,527.21)
parent company
Minority shareholders’ gains and
2,663,005.69 1,041,996.33
losses
VI. Earnings per share
i. Basic earnings per share (XLI) 0.02 (0.10)
ii. Diluted earnings per share (XLI) 0.02 (0.10)
VII. Other consolidated income (XLII) -
VIII. Total consolidated income 7,059,360.67 (17,221,530.88)
Total consolidated income attributable to
4,396,354.98 (18,263,527.21)
owners of parent company
Total consolidated income attributable to
2,663,005.69 1,041,996.33
minority shareholders
33
Principal of the Company: Zheng Yuxi
Person in Charge of Accounting Works: Zeng Suyan
Person in Charge of Accounting Institution: Wang Zhiping
Consolidated Cash Flow Statement for Shenzhen Shenbao Industrial Co., Ltd.
Note Jan.-June of Jan.-June of
Item
V 2011 2010
I. Cash flows arising from operating activities:
Cash received from selling commodities and providing labor 177,726,719. 114,460,696.
services 69 41
Write-back of tax received 49,009.53 188,371.62
(XLI
Other cash received concerning operating activities 6,445,884.77 9,876,986.68
I)
184,221,613. 124,526,054.
Subtotal of cash inflow arising from operating activities
99 71
139,613,835. 83,962,650.3
Cash paid for purchasing commodities and receiving labor service
64 5
17,020,987.8 18,724,555.4
Cash paid to/for staff and workers
5 7
12,934,545.2
Taxes paid 6,157,716.15
6
(XLI 22,924,655.8 21,813,251.0
Other cash paid concerning operating activities
I) 7 9
192,494,024. 130,658,173.
Subtotal of cash outflow arising from operating activities
62 06
(8,272,410.6 (6,132,118.3
Net cash flows arising from operating activities
3) 5)
II. Cash flows arising from investing activities:
24,800,000.0
Cash received from recovering investment -
0
Cash received from investment income
Net cash received from disposal of fixed, intangible and other 13,051,728.0
2,718,835.00
long-term assets 0
Net cash received from disposal of subsidiaries and other units - -
Other cash received concerning investing activities - -
37,851,728.0
Subtotal of cash inflow from investing activities 2,718,835.00
0
17,789,197.6 75,269,397.2
Cash paid for purchasing fixed, intangible and other long-term assets
9 6
Cash paid for investment 1,200,000.00
(20,000,000.
Net increase of mortgaged loans
00)
34
Net cash received from subsidiaries and other units - -
Other cash paid concerning investing activities -
(2,210,802.3 76,469,397.2
Subtotal of cash outflow from investing activities
1) 6
40,062,530.3 (73,750,562.
Net cash flows arising from investing activities
1 26)
III. Cash flows arising from financing activities
512,499,992.
Cash received from absorbing investment -
40
Including: Cash received from absorbing minority shareholders’
- -
investment by subsidiaries
65,000,000.0 134,000,000.
Cash received from loans
0 00
Cash received from issuing bonds - -
55,756,182.0
Other cash received concerning financing activities
0
577,499,992. 189,756,182.
Subtotal of cash inflow from financing activities
40 00
52,400,000.0 137,500,000.
Cash paid for settling debts
0 00
Cash paid for dividend and profit distributing or interest paying 5,530,183.59 5,650,201.01
Including: Dividend and profit of minority shareholder paid by
- -
subsidiaries
Other cash paid concerning financing activities 4,099,501.38 -
62,029,684.9 143,150,201.
Subtotal of cash outflow from financing activities
7 01
515,470,307. 46,605,980.9
Net cash flows arising from financing activities
43 9
IV. Influence on cash and cash equivalents due to fluctuation in
(8,344.27)
exchange rate
547,252,082. (33,276,699.
V. Net increase of cash and cash equivalents
84 62)
40,540,179.3 90,613,421.7
Add: Balance of cash and cash equivalents at the period -begin
2 0
(XLI 587,792,262. 57,336,722.0
VI. Balance of cash and cash equivalents at the period -end
II) 16 8
Principal of the Company: Zheng Yuxi
Person in Charge of Accounting Works: Zeng Suyan
Person in Charge of Accounting Institution: Wang Zhiping
35
Balance Sheet for Shenzhen Shenbao Industrial Co., Ltd.
Assets Note XI 2011-6-30 2010-6-30
Current assets:
Monetary funds 564,324,133.25 43,617,846.34
Transactional financial assets 17,334,869.55 -
Notes receivable - -
Account receivable (I) 13,451.24 26,834.82
Account paid in advance - -
Interest receivable - -
Dividend receivable - -
Other receivables (II) 264,954,419.54 293,645,635.65
Inventories 951,531.42 824,287.66
Non-current asset due within one year - -
Other current assets - -
Total current assets 847,578,405.00 338,114,604.47
Non-current assets:
Finance asset available for sales - -
Held-to-maturity investment - -
Long-term account receivable - -
Long-term equity investment (III) 287,856,754.07 224,821,521.50
Investment real estate 25,086,337.67 25,501,779.89
Fixed assets 3,034,406.52 2,949,630.80
Construction in progress 5,723,542.10 4,657,647.12
Engineering material - -
Disposal of fixed asset - -
Productive biological asset 270,016.00 242,021.00
Oil and gas asset - -
Intangible assets 67,525,146.73 68,437,527.61
Expense on Research and Development - -
Goodwill - -
Long-term expenses to be apportioned 924,520.57 1,063,758.19
Deferred income tax asset 1,235,914.32 1,235,914.32
Other non-current asset - -
Total non-current asset 391,656,637.98 328,909,800.43
Total assets 1,239,235,042.98 667,024,404.90
Principal of the Company: Zheng Yuxi
Person in Charge of Accounting Works: Zeng Suyan
Person in Charge of Accounting Institution: Wang Zhiping
36
(Cont’)Balance Sheet for Shenzhen Shenbao Industrial Co., Ltd.
Liability & Shareholders’ equity Note XI 2011-6-30 2010-6-30
Current liabilities:
Short-term loans 30,000,000.00 19,000,000.00
Transaction financial liabilities - -
Notes payable - -
Accounts payable 326,088.46 172,066.01
Accounts received in advance - -
Wage payable 496,007.96 2,280,240.37
Taxes payable 72,912.61 79,815.08
Interest payable - -
Dividend payable 2,909,182.74 2,909,182.74
Other accounts payable 116,490,739.07 120,151,055.55
Non-current liabilities due within 1 year 57,500,000.00 66,500,000.00
Other current liabilities - -
Total current liabilities 207,794,930.84 211,092,359.75
Non-current liabilities:
Long-term loans 26,000,000.00 27,000,000.00
Bonds payable - -
Long-term account payable - -
Special accounts payable - -
Projected liabilities - -
Deferred income tax liabilities - -
Other non-current liabilities 49,920.00 49,920.00
Total non-current liabilities 26,049,920.00 27,049,920.00
Total liabilities 233,844,850.84 238,142,279.75
shareholders’ equity
share capital 250,900,154.00 181,923,088.00
Capital public reserve 583,510,721.44 80,095,645.55
Less: Inventory shares - -
Reasonable reserve - -
Surplus public reserve 32,464,033.34 32,464,033.34
Provision of general risk - -
Retained profit 138,515,283.36 134,399,358.26
Total shareholders’ equity 1,005,390,192.14 428,882,125.15
Total Liability & Shareholders’ equity 1,239,235,042.98 667,024,404.90
Principal of the Company: Zheng Yuxi
Person in Charge of Accounting Works: Zeng Suyan
Person in Charge of Accounting Institution: Wang Zhiping
37
Profit Statement for Shenzhen Shenbao Industrial Co., Ltd.
Note Jan.-June of Jan.-June of
Item
XI 2011 2010
I. operating income (IV) 1,434,424.23 1,347,753.85
Less: Operating cost (IV) 91,320.28 79,866.50
Operating tax and extras 66,000.00 62,610.08
Sales expenses 515,239.93 180,580.50
Administration expenses 11,040,603.19 6,860,925.37
Financial expenses 2,392,752.83 2,878,389.22
Losses of devaluation of asset 540.00
Add: Changing income of fair value(Loss is listed
- -
with “-”)
(14,014,997.9
Investment income (V) (265,249.23)
3)
Including: Investment income on affiliated company (12,550,001.2
(265,249.23)
and joint venture 5)
(12,937,281.2 (22,729,615.7
III. Operating profit
3) 5)
Add: Non-operating income 17,088,533.21 1,216,901.37
Less: Non-operating expense 35,326.88
Including: Disposal loss of non-current asset 35,326.88
(21,512,714.3
IV. Total Profit 4,115,925.10
8)
Less: Income tax expense
(21,512,714.3
V. Net profit 4,115,925.10
8)
VI. Earnings per share
i. Basic earnings per share - -
ii. Diluted earnings per share - -
VII. Other consolidated income -
(21,512,714.3
VIII. Total consolidated income 4,115,925.10
8)
Principal of the Company: Zheng Yuxi
Person in Charge of Accounting Works: Zeng Suyan
Person in Charge of Accounting Institution: Wang Zhiping
38
Cash Flow Statement for Shenzhen Shenbao Industrial Co., Ltd.
Note Jan.-June of Jan.-June of
Item
XI 2011 2010
I. Cash flows arising from operating activities:
Cash received from selling commodities and providing labor
1,413,364.27 161,000.50
services
Write-back of tax received - -
26,947,390.3
Other cash received concerning operating activities (VI) 4,239,039.14
2
27,108,390.8
Subtotal of cash inflow arising from operating activities 5,652,403.41
2
Cash paid for purchasing commodities and receiving labor
271,848.55 156,022.10
service
Cash paid to/for staff and workers 5,784,877.12 9,074,261.51
Taxes paid 919,246.61 477,632.30
20,208,017.3 44,966,320.9
Other cash paid concerning operating activities (VI)
3 6
27,183,989.6 54,674,236.8
Subtotal of cash outflow arising from operating activities
1 7
(21,531,586. (27,565,846.
Net cash flows arising from operating activities
20) 05)
II. Cash flows arising from investing activities:
24,800,000.0
Cash received from recovering investment -
0
Cash received from investment income
Net cash received from disposal of fixed, intangible and other 13,000,000.0
1,680,835.00
long-term assets 0
Net cash received from disposal of subsidiaries and other
- -
units
Other cash received concerning investing activities - -
37,800,000.0
Subtotal of cash inflow from investing activities 1,680,835.00
0
Cash paid for purchasing fixed, intangible and other 55,930,652.5
1,143,684.68
long-term assets 1
Cash paid for investment -
(20,000,000.
Net increase of mortgaged loans
00)
Net cash received from subsidiaries and other units - -
Other cash paid concerning investing activities -
Subtotal of cash outflow from investing activities (18,856,315. 55,930,652.5
39
32) 1
56,656,315.3 (54,249,817.
Net cash flows arising from investing activities
2 51)
III. Cash flows arising from financing activities
512,499,992.
Cash received from absorbing investment -
40
30,000,000.0 92,000,000.0
Cash received from loans
0 0
Cash received from issuing bonds - -
55,756,182.0
Other cash received concerning financing activities
0
542,499,992. 147,756,182.
Subtotal of cash inflow from financing activities
40 00
29,000,000.0 100,500,000.
Cash paid for settling debts
0 00
Cash paid for dividend and profit distributing or interest
3,818,933.23 4,718,700.90
paying
Other cash paid concerning financing activities 4,099,501.38
36,918,434.6 105,218,700.
Subtotal of cash outflow from financing activities
1 90
505,581,557. 42,537,481.1
Net cash flows arising from financing activities
79 0
IV. Influence on cash and cash equivalents due to
-
fluctuation in exchange rate
540,706,286. (39,278,182.
V. Net increase of cash and cash equivalents (VI)
91 46)
Add: Balance of cash and cash equivalents at the period 23,617,846.3 76,004,694.0
-begin 4 3
VI. Balance of cash and cash equivalents at the period 564,324,133. 36,726,511.5
(VI)
-end 25 7
Principal of the Company: Zheng Yuxi
Person in Charge of Accounting Works: Zeng Suyan
Person in Charge of Accounting Institution: Wang Zhiping
40
Statement of Change in Owners’ Equity for semi-annual of 2011
Amount of the Current Term Last Year
Owners’ equity attributable to the parent company Owners’ equity attributable to the parent company
Provision Minor Total of Provision Minor Total of
项目 Paid-up Less: Paid-up Less:
Capital Reasonable Surplus of Retained shareholders’ owners’ Capital Reasonable Surplus of Retained shareholders’ owners’
capital(Share inventory Others equity equity capital(Share inventory Others equity equity
reserves reserve reserves general profit reserves reserve reserves general profit
capital) shares capital) shares
risk risk
I. Balance at
the end of 181,923,088.00 79,873,070.29 32,464,033.34 30,831,869.17 47,849,552.44 372,941,613.24 181,923,088.00 80,564,909.22 32,464,033 25,144,224.38 45,244,179.29 365,340,434.23
last year
Plus: Change
of
accounting
policy
Correcting of
previous
errors
Others
II. Balance at
the
181,923,088.00 79,873,070.29 32,464,033.34 30,831,869.17 47,849,552.44 372,941,613.24 181,923,088.00 80,564,909.22 32,464,033.34 25,144,224.38 45,244,179.29 365,340,434.23
beginning of
current year
III. Changed
in current
term(Loss is 68,977,066.00 488,827,152.22 4,396,354.98 -47,849,552.44 514,351,020.76 -691,838.93 5,687,644.79 2,605,373.15 7,601,179.01
listed with
“-”)
(I) Net profit 4,396,354.98 2,663,005.69 7,059,360.67 5,687,644.79 3,297,744.70 8,985,389.49
(II) Other
consolidated -210,249.15 -210,249.15
income
Subtotal of 7,059,360.67
4,396,354.98 2,663,005.69 -210,249.15 5,687,644.79 3,297,744.70 8,775,140.34
(I) and (II)
(III) Owners
input and
withdraw of
68,977,066.00 488,827,152.22 (50,512,558.13) 507,291,660.09 -481,589.78 -692,371.55 -1,173,961.33
share capital
1. Capital
input by 68,977,066.00 503,415,075.89 572,392,141.89
shareholders
2. Share
payment
accounted -
into
shareholders’
equity
3. Others -14,587,923.67 (50,512,558.13) (65,100,481.80) -481,589.78 -692,371.55 -1,173,961.33
41
(IV) Profit
distribution
1. Providing
of surplus
reserves
2. Common
risk
provision
3. Dividend
to
shareholders
4. Others
(V) Internal
settlement of
shareholders’
equity
1. Capital
reserves
transferred to
share capital
2. Surplus
reserves
transferred to
share capital
3. Making up
losses by
surplus
reserves
4. Others
(VI)
Reasonable
reserve
1.
Withdrawal
in the report
period
2. Usage in
the report
period
(VII)
Others
IV. Balance
at the end of 250,900,154.00 568,700,222.51 32,464,033.34 35,228,224.15 887,292,634.00 181,923,088.00 79,873,070.29 32,464,033.34 30,831,869.17 47,849,552.44 372,941,613.24
this term
Principal of the Company: Zheng Yuxi
Person in Charge of Accounting Works: Zeng Suyan
Person in Charge of Accounting Institution: Wang Zhiping
42
Statement of Change in Owners’ Equity for semi-annual of 2011(Parent Company)
Amount of the Current Term Last Year
Provision Provision
Item Paid-up Less: Paid-up Less:
Capital Reasonable Surplus of Total of owners’ Capital Reasonable Surplus of Total of
capital(Share inventory Retained profit capital(Share inventory Retained profit
reserves reserve reserves general equity reserves reserve reserves general owners’ equity
capital) shares capital) shares
risk risk
I. Balance at
the end of 181,923,088.00 80,095,645.55 32,464,033.34 134,399,358.26 428,882,125.15 181,923,088.00 80,305,894.70 32,464,033.34 137,778,205.32 432,471,221.36
last year
Plus: Change
of
accounting
policy
Correcting of
previous
errors
Others
II. Balance at
the
181,923,088.00 80,095,645.55 32,464,033.34 134,399,358.26 428,882,125.15 181,923,088.00 80,305,894.70 32,464,033.34 137,778,205.32 432,471,221.36
beginning of
current year
III. Changed
in current
term(Loss is 68,977,066.00 503,415,075.89 4,115,925.10 576,508,066.99 -210,249.15 -3,378,847.06 -3,589,096.21
listed with
“-”)
(I) Net profit 4,115,925.10 4,115,925.10 -3,378,847.06 -3,378,847.06
(II) Other
consolidated -210,249.15 -210,249.15
income
Subtotal of
4,115,925.10 4,115,925.10 -210,249.15 -3,378,847.06 -3,589,096.21
(I) and (II)
(III)
Shareholder
input and 68,977,066.00 503,415,075.89 572,392,141.89
withdraw of
share capital
1. Capital
input by 68,977,066.00 503,415,075.89 572,392,141.89
shareholders
2. Share
payment
accounted
into
shareholders’
equity
3. Others
43
(IV) Profit
distribution
1. Providing
of surplus
reserves
2. Common
risk
provision
3. Dividend
to
shareholders
4. Others
(V) Internal
settlement of
shareholders’
equity
1. Capital
reserves
transferred to
share capital
2. Surplus
reserves
transferred to
share capital
3. Making up
losses by
surplus
reserves
4. Others
(VI)
Reasonable
reserve
1.
Withdrawal
in the report
period
2. Usage in
the report
period
(VII)
Others
IV. Balance
at the end of 250,900,154.00 583,510,721.44 32,464,033.34 138,515,283.36 1,005,390,192.14 181,923,088.00 80,095,645.55 32,464,033.34 134,399,358.26 428,882,125.15
this term
Principal of the Company: Zheng Yuxi
Person in Charge of Accounting Works: Zeng Suyan
Person in Charge of Accounting Institution: Wang Zhiping
44
Section II Notes of Financial Statement for semi-annual of 2011
I. Company profile
Shenzhen Shenbao Industrial Co., Ltd. (hereinafter referred to as the Company)
(formerly named Shenzhen Shenbao Canned Food Company), obtained approval
(Document (1991) No.978) from Shenzhen Municipal People’s Government to change to
the present name as at 1 August 1991. Then with the approval (Document (1991)No.126)
from People’s Bank of China, the Company began to list on Shenzhen Stock Exchange
and was granted the business license numbered Shen-Si-Zi N27358.
The Company initially issued 107,312,935 shares in the stock exchange. In 1992, one
bonus share was dispatched for each 10 shares held by its shareholders, thus totally
10,731,290 shares were increased. In 1993, one bonus share and one allotted share were
dispatched for each 10 shares held by its shareholders, thus totally 20,878,845 shares
were increased. Sequently, one bonus share was dispatched for each 10 shares held by
shareholders upon the basis of total share capital as at the end of 1996, and capitalizing
of capital reserves was carried out at one to ten basis, thus totally 27,784,614 shares were
increased. In 2001, based on the total share capital as at the end of 1999, 3 shares were
allotted for each 10 shares held by shareholders, and totally 15,215,404 shares were
alloted. The registered capital of the Company amounts to RMB181,923,088.
On 22 June 2011, the Company placed RMB ordinary share (A-Share) of 68,977,066
shares privately to specific targets with carrying value of 1.00 yuan each, placing
subscription price of 8.70 yuan per share. The placing totaling raised fund of
600,100,474.20 yuan and changed procedures for Industrial and Commerce has been
done on 12 July. Register capital for the Company currently amount to 250,900,154.00
yuan.
The Company belongs to food and beverage industry, with the following major
operations: production of food can, beverage and local products(business license of their
production base is applied additionally); domestic commerce and supply and marketing
of materials (excluding government controlled or dominated merchandises); import and
export business(transacted according to SMGSZZ No.080 document in respect of
authentication certificate for foreign trade enterprises); development and operation of
property on legally obtained land.
The Company’s main products are: tea series under “Jindiao” brand include instant tea
powder and tea concentrate; seasoning series under “Sanjing” brand include oyster sauce,
olive vegetable, and soy; beverages series under “Shenbao” brand include daisy tea,
lemon tea, and wax gourd tea.
II. Major accounting policy, accounting estimation and prior-period errors
(I)Basis of preparation of financial statements
Taking continuing operation as basis, the Company processed confirmation and
measurements according to the actual businesses and proceedings, by reference to
regulations of Accounting Standards for Enterprises-Basic Standards and other various
accounting standards, and then prepared financial statements on such basis.
(II)Statement for observation of Accounting Standard for Enterprise
The financial statements prepared by the Company are in accordance to requirements of
45
Accounting Standard for Enterprise, which truly and completely reflect the information
related to financial position, operational results and cash flow of the Company.
(III)Accounting period
One accounting period falls to the range starting from 1 January to 31 December.
(IV)Standard currency
The Company and its subsidiaries take RMB as the standard currency for bookkeeping.
(V)Accounting treatment for business combinations under the same control and
those not under the same control
1. Business combination under the same control
Assets and liabilities acquired by the Company during business combination are
measured by their carrying value recorded in the accounting book of the combined party
as at the combination date. The difference between the carrying value of the net assets
acquired through combination and the carrying value of combination consideration paid
(or total carrying value of shares in issue) shall be used to adjust capital reserve. When
the capital reserve is insufficient for offset, then the retained profit shall be adjusted.
Each direct expense related to business combination born by the Company, among other
things, the audit fee, valuation expense and law service expense paid for business
combination shall be written into current gains and losses upon happening.
Charge and commission arising from issuance of equity securities during business
combination shall be used for offsetting premium income of such securities. When such
premium income is not enough for offset, then it shall turn to retained profit for offset.
As for the combined parties which adopt different accounting policies from the Company,
the Company shall make relevant adjustment in accordance to its own accounting policy
as at the combination date, and offer confirmation by virtue of Accounting Standard for
Enterprise on this basis.
2. Business combination not under the same control
The Company measures the assets and liabilities paid or occurred or undertaken as
consideration for business combination at their fair value as at the purchase day.
Difference between fair value and carrying value shall be recorded in current gains and
losses.
Combined cost is allocated by the Company as at the purchase date.
Combined cost less the fair value of the recognizable net assets acquired from vendor
through combination is confirmed as goodwill if the result is positive, while as current
gains and losses if it is negative.
As for other various assets (except for intangible assets and not only limited to the assets
originally recognized by vendor) obtained by business combination from vendor, the
economic benefits brought by such assets are likely to flow into the Company, besides,
their fair value could be reliably measured. Thus, they shall be recognized separately and
measured at fair value; the intangible assets whose fair value could be reliably measured
shall be separately recognized as intangible assets and measured at fair value; As for
other various liabilities (except for contingent liabilities) obtained from vendor,
46
implementation of relevant obligations leads to that economic benefits are likely to flow
out from the Company, besides, their fair value could be reliably measured. Thus, they
shall be recognized separately and measured at fair value; the contingent liabilities
obtained from vendor whose fair value could be reliably measured shall be separately
recognized as liabilities and measured at fair value.
(6)Methods for preparation of consolidated financial statements
The consolidation scope of the consolidated financial statements of the Company is fixed
on the basis of control, and all subsidiaries have been consolidated.
The accounting policies and accounting period adopted by the subsidiaries taken into
account of the consolidation scope are in line with the Company. If it is not the same as
the Company, necessary adjustments will be made when preparing consolidated financial
statements according to the accounting policy and accounting period of the Company.
Based on the financial statements of the Company and its subsidiaries, the Company
prepares the consolidated financial statements by reference to other related information
after adjustment in its long-term equity investments to subsidiaries by equity method.
When consolidating financial statements, the Company shall offset all effects upon
consolidated balance sheet, consolidated profit statement, consolidated cash flow
statement and consolidated statement of changes in equity arising from the internal
transactions between the Company and each subsidiary and between various subsidiaries.
Balance between the current losses shared by minority shareholders of subsidiaries
exceeding the proportion shared by those shareholders in beginning owners’ equity of
those subsidiaries, the balance shall be used to offset minority’s equity of the Company.
During the report period, beginning amounts in consolidated balance sheet shall be
subject to adjustment if business combination under the same control results in additional
subsidiaries; income, expense and profit of such subsidiaries occurred during the whole
consolidation period shall be accounted into consolidated profit statement; and the cash
flow of subsidiaries occurred during the whole consolidation period shall be accounted
into consolidated cash flow statement.
During the report period, beginning amounts in consolidated balance sheet is not subject
to adjustment if business combination not under the same control results in additional
subsidiaries; income, expense and profit of such subsidiaries occurred during the period
commencing from purchase day to the end of reporting year shall be accounted into
consolidated profit statement; and the cash flow of such subsidiaries occurred during the
period commencing from purchase day to the end of reporting year shall be accounted
into consolidated cash flow statement.
During the report period, if the Company disposes subsidiaries, then the income, expense
and profit of the subsidiaries occurred during the period commencing from period-begin
to the disposal day shall be written into consolidated profit statement; and cash flow
arising during such period of such subsidiaries shall be written into consolidated cash
flow statement.
(VII)Recognition standards for cash and cash equivalents
When preparing cash flow statement, the Company recognized the stock cash and
deposits available for payment at any time as cash, and investments featuring with the
47
following four characters at the same time as cash equivalents: short term (expire within
3 months commencing from purchase day), active liquidity, easy to convert to
already-known cash, and small value change risks.
(VIII)Foreign currency business
When initially recognizing foreign currency business, the Company translates the foreign
currency amount to standard currency amount by virtue of spot exchange rate as at the
happening date of trade.
As at the balance sheet date, monetary items of foreign currency are translated at spot
exchange rate as at balance sheet day. Translation difference arising from difference
between the spot exchange rates respectively as at balance sheet day and initial
recognition day or previous balance sheet day, shall be written in current gains and losses.
As for non-monetary items denominated by foreign currency which are measured at
historical cost, translation is still subject to spot exchange rate as at happening day of
trade, without any change in the amount in standard currency.
(IX)Financial instruments
Financial instruments include financial assets, financial liabilities and equities
instruments.
1. Categories of financial instruments
According to the purposes held for financial assets and liabilities, the management
categorizes them into: financial assets or financial liabilities at fair value through current
gains and losses, including transactional financial assets or financial liabilities;
held-to-maturity investment; accounts receivable; financial assets available for sale; other
financial liabilities, etc.
2. Recognition evidence and measurement methods for financial instruments
(1) Financial assets (financial liabilities) at fair value through current gains and losses
Such assets bear initial recognition amounts at fair value (after deduction of cash
dividends declared but not granted yet or bond interests which arrives at settlement
moment but not collected yet) when being obtained, and relevant transaction expense
falls into current gains and losses.
Interests or cash dividends acquired during holding are recognized as investment income,
and movement of fair value is recorded in current gains and losses as at year end.
When disposing such assets or liabilities, the Company shall recognize the difference
between fair value and initial booking amount as investment income, and gains and
losses from movements of fair value shall be subject to adjustment at the same time.
(2)Held-to-maturity investment
Held-to-maturity investment bears initial recognition amount at aggregate of fair value
(after deduction of bond interests which arrives at settlement moment but not collected
yet) and relevant transactional expenses when being obtained.
When holding such investments, interest income is calculated and recognized according
to remaining amortized cost and effective interest rate, and then written into investment
income. Effective interest rate is recognized when obtaining such investments, and not
subject to change during the expected duration period or applicable shorter period.
When disposing such investments, the Company shall treat the balance between the
payment for obtaining such investments and carrying value thereof as investment
48
income.
(3)Financial assets available for sale
Financial assets available for sale bear initial recognition amount at aggregate of fair
value (after deduction of cash dividends declared but not granted yet or bond interests
which arrive at settlement moment but not collected yet) and relevant transactional
expenses when being obtained.
Interests or cash dividends acquired during holding are recognized as investment income.
They will be measured at fair value and movements of their fair values shall be recorded
in capital reserve (other capital reserve) at year end.
When disposing such assets, the Company shall treat the balance between the payments
for obtaining such financial assets and carrying value thereof as investment gains and
losses; meanwhile, the amounts correspondingly disposed due to accumulative
movements of fair value originally recorded in owners’ equity directly shall be reversed
out and recorded in investment gains and losses.
(4)Other financial liabilities
Other financial liabilities bear initial recognition amount at aggregate of fair value and
relevant transactional expenses. Subsequent measurement is conducted at amortized cost.
3. Confirmation evidence and measurement methods for transfer of financial assets
When transfer of financial assets occurs, the Company shall stop recognition of such
financial assets if all risks and remunerations related to ownership of such financial
assets have almost been transferred to the receiver; while shall continue to recognize such
financial assets if all risks and remunerations related to ownership of such financial
assets have almost been retained.
When judging whether or not the aforesaid terminal recognition condition for financial
assets is arrived at for transfer of financial assets, the Company generally adopts the
principle that substance overweighs format. The Company divides such transfer into
entire transfer and part transfer. As for the entire transfer meeting condition for
discontinued recognition, balance between the following two items is recorded in current
gains and losses:
(1)Carrying value of financial assets in transfer;
(2)Aggregate of the consideration received from transfer and accumulative movements of
fair value originally recorded in owners’ equity directly (applicable when financial assets
involved in transfer belong to financial assets available for sale).
As for the part transfer meeting condition for discontinued recognition, entire carrying
value of financial assets in transfer is shared by discontinued recognition part and
continued recognition part, in light of their respective fair value. Balance between the
following two items is recorded in current gains and losses:
(1)Carrying value of discontinued recognition part;
(2)Aggregate of the consideration of discontinued recognition part and amount of such
part attributable to accumulative movements of fair value originally recorded in owners’
equity directly (applicable when financial assets involved in transfer belong to financial
assets available for sale).
Financial assets are still subject to recognition if transfer of such assets doesn’t satisfy the
condition for discontinued recognition. And consideration received is recognized as
financial liability.
4. Recognized measures on the fair value of financial assets
The financial assets measured by fair value should be valued based on the quotation
49
which exists in the active market at period-end.
(X) Account receivable
Accounts receivable refer to trade receivables and other receivables. The Company
recognizes accounts receivable at their fair value when obtaining such accounts.
Subsequent measurement is conducted for accounts receivable at effective interest rate
and amortized cost.
The Company adopts the following standards for recognition of bad debt: ○debts which
can not be collected by settlement with bankruptcy properties or heritage of debtors who
face revoke, bankruptcy or death, and cash flow is in serious shortage; ○debts which are
past due while not settled by debtors and featured with obvious characteristics indicating
that it is not able to collect. Account receivable is recognized as bad debt losses if there
are obvious evidences indicating that the accounts are not possible to collect, and the
provision of bad debt reserve shall then be offset.
The Company adopts allowance method to calculate bad debt reserve which is likely to
happen.
1. Standards for recognized and withdrawal method on account receivable with
single significant item and withdrawal bed debt provision separately
Recognized standards for account receivable with single significant item and withdrawal
bed debt provision separately:
Standard for single significant item: amount occupied 10 percent (including 10 percent)
of the balance of account receivable.
Withdrawal method on bad debt provision for account receivable with single significant
item: conducted impairment testing separately, balance between the present value of
future cash flow and its carrying value, bad debt provision withdrawal and reckoned into
current gains/losses.
2. Standards for recognized and withdrawal method on bad debt provision of
account receivable withdrawal by age combination
(1) Combination of account receivable with no impairment is found after separately
testing.
(2) Withdrawal method recognized by the combination: way for the withdrawal of bad
debt is the age analysis method, standards as:
Aging Withdrawal Withdrawal proportion
proportion for for other account
account receivable receivable
Within one year (one year 0% 0%
included)
One to two years(two years 5% 5%
included)
Two to three years(three 10% 10%
years included)
Above three years 15% 15%
3. Reasons and withdrawal method etc. required disclosure for those account
receivable with minor single item but withdrawal bed debt provision single
50
The combination refers to the account receivable with minor single item but conducted
impairment testing separately without bad debt provision withdrawal by age analysis,
that according to actual situation of the Company.
Concerning the account receivable with minor single item of no impairment is found in
testing separately, withdrawal the bad debt provision by risk combination with the age.
(XI)Inventories
1. Classification
Inventories of the Company mainly are: stock goods, delivered goods, product-in-process,
raw materials, packing materials, low value consumables and materials for entrust
processing, etc.
2. Valuation
Inventories are priced at costs when purchased or delivered to stock, and by weighted
average method when delivered out from stock.
3. Recognized standards of the net realizable value for inventory and withdrawal
method on provision of inventory
After inventory at period-end, the inventories are accounted depending on which is lower
between the cost and the net realizable value or adjusted the provision of inventory.
The net realizable value of finished goods, products and sellable materials, in normal
business production, is measured as the residual value after deducting the estimated sales
expense and related taxes and fees from the estimated selling price; the net realizable
value of an item of inventories subject to further processing, in normal business
production, is measured as the residual value after deducting the sum of the estimated
costs of completion, sales expense and related taxes and fees from the estimated selling
price of the sellable item. The net realizable value of the quantity of inventories held to
satisfy firm sales or service contracts is based on the contract price. If the sales contracts
are for less than the inventory quantities held, the net realizable value of the excess is
based on general selling prices.
An impairment allowance, if any, is generally individually recognized for each type of
inventories at period-end except: For an individual impairment allowance, if any, is
recognized for the whole category of inventories of low value and large quantities; and
for an individual impairment allowance, if any, is recognized for a group of inventories,
which are held for the production and sales of products of a single territory and for
identical or similar usages or purposes, and which are indistinguishable from other types
of inventories within the group.
If the previous factors resulting in deduction of inventories values disappear, then such
deduction of value shall be reversed back from the original provision of inventory
depreciation reserve, and turns to current gains and losses.
4. Stocktaking
The Company adopts the perpetual stocktaking system.
5. Amortization of low-value consumables and packaging materials
(1) Installment amortization is applicable to low value consumables;
(2) Packing materials are recorded in production cost at once when being received.
(XII) Long-term equity investment
1. Recognition of investment cost
51
(1) Long-term equity investment formed from business combination
Long-term equity investment formed from business combination under the same control:
if the Company takes cash payment, transfers non-cash assets or undertakes debts and
issues equity securities as consideration for combination, the share of carrying value of
owner's equity of the merged party on the merger date shall be taken as the initial
investment cost for such long-term equity investment. Capital reserve is subject to
adjustment at difference between the initial investment cost and combination
consideration paid for the long-term equity investment; or otherwise adjust retained
profit if the capital reserve is not enough for offset. Each direct expense related to
business combination, among other things, the audit fee, valuation expense and law
service expense paid for business combination shall be written into current gains and
losses upon happening.
Long-term equity investment formed from business combination not under the same
control: the combination cost is the asset given, liabilities occurred or undertaken by the
Company for obtaining controlling power, and the fair value of equity securities issued
and various direct related expenses occurred for business combination. As for the kind of
business combination realized by multiple exchange transactions step by step, its
combination cost equals to aggregate of each single combination, including the fees paid
to advisers such as auditors, solicitors, values, consultants, etc. and other related
administrative expenses are accounted for through profit or loss for the reporting period
during which they are incurred; transaction costs incurred by the acquirer directly
attributable to the issuance of equity instruments or debt instruments, which are
consideration for the acquisition, are capitalized as part of the initial measurement of the
relevant equity instruments or debt instruments. For the future proceedings agreed in
combination contract which are likely to affect combination cost, if such proceedings are
expected to happen as at the purchase day and the affected amount over combination cost
could be reliably measured, it also shall be recorded in combination cost.
(2)Long-term equity investments obtained through other ways
For long-term equity investments obtained through payment with cash, then the actual
payment shall be viewed as initial investment cost.
For long-term equity investments obtained through issuance of equity securities, then the
fair value of such securities shall be viewed as initial investment cost.
For long-term equity investments input by investors, then the value agreed in investment
contract or agreement (after deduction of cash dividend or profit declared while not
granted yet) shall be viewed as initial investment cost, while excluding the value agreed
in contract or agreement is not fair valued.
Under the precedent condition that non-monetray assets exchanges are featured with
commercial nature and fair values of exchange-in or exchange-out assets can be reliably
measured, long-term equity investment exchange-in through non-monetary assets
exchange shall be recognized with initial investment cost on the basis of the fair value of
the assets exchange-out, unless there is obvious evidence showing that fair value of
exchange-in assets is more reliable; as for non-monetray assets exchanges not satisfying
such precedent condition, initial investment cost of exchange-in long-term equity
investment falls to the carrying value of exchange-out assets and relevant taxes payable.
For long-term equity investments obtained through debt reorgnization, its initial
investment cost is recognized based on fair value.
2. Subsequent measurement and recognition of gains and losses
52
(1) Subsequent measurement
As for long-term equity investment made by the Company to its subsidiaries, calculation
is conducted by cost method, while equity method is adopted for adjustment when
preparing consolidated financial statements.
Cost method is used for calculation when the Company has no common control or
significant influence over the invested units. Besides, such long-term equity investments
have no quotation in an active market and their fair values can’t be reliably measured.
Equity method is used for calculation when the Company has common control or
significant influence over the invested units. When initial investment cost is higher than
the share of fair value of net realizable assets of the invested unit, then the initial
investment cost of the long-term equity investment remains with no adjustment; while if
the aforesaid former is lower than the later, then difference shall be recorded in current
gains and losses.
Disposal of other changes in owners’ equity (except for changes in net gains and losses)
of the invested units: for other changes in owners’ equity (except for changes in net gains
and losses) of the invested units, with shareholding proportion held constant, the
Company computers how much it should share or undertake according to the
shareholding proportion, adjusts carrying value of such long-term equity investment and
increase or decrease capital reserve (other capital reserve) at the same time.
(2) Recognition of gains and losses
Under cost method, other than payment actually paid for obtaining investment or cash
dividend or profit included in consideration which has been declared while not granted
yet, the Company recognizes investment income according to its share in the cash
dividend or profit declared for grant by the invested unit.
Under equity method, when the Company is confirmed to share losses of the invested
units, the following order shall prevail for disposal: first of all, offset carrying value of
long-term equity investment. Second, for long-term equity investment whose carrying
value is not enough for offset, investment loss should be continued to recognize within
the limit of carrying value of other long-term equity which substantially forms net
investment to invested units, to offset carrying value of long-term items receivable. At
last, after the aforesaid treatment, if enterprise still bears additional duties according to
investment contract or agreement, projected liabilities are recognized in accordance to
the the obligations which are expected to undertake, and then recorded in current gains
and losses.
In the event that the invested unit realizes profit in later periods, the Company will adopt
disposal adversed to the above order after deduction the unrecognized share of loss, i.e.
write off the carrying value of the recognized projected liabilities, recover carrying value
of long-term equity which substantially forms net investment to invested unit and
long-term equity investment, and recognize investment income at the same time.
3. Evidence showing common control and significant influence with invested units
Common control over certain economic activity agreed by contract only exist when
investors who need to share control power on material financial and operation decisions
related to such economic activity make unanimous agreement, and then it is deemed as
53
common control implemented by other parties to invested unit; if a party has power to
join decision-making related to finance and operation of an enterprise, while no ability of
control or joint control with other parties upon establishement of such decisions, the
party is then deemed that it has significant influence upon invested unit.
4. Impairment testing and withdrawal of the impairment
For long-term equity investment with no significant influence, no quotation in active
market and whose fair value could not be reliably measured, its impairment reserve is
recognized based on the balnce between its carrying value and present value recognized
through discounted future cash flow of similar financial assets at the prevailing market
rate of return.
For other long-term equity investments (except for goodwill) formed from business
combination where impairment signs appear, if the measurement on the recoverable
amount shows that the recoverable amount of such long-term equity investment is lower
than its fair value, then the difference is recognized as impairment loss.
As for goodwill formed from business combination, impairment testing will be made
each year, no matter whether or not there is impairment indication.
Once impairment loss is recognized for long-term equity investment, there will be no
stand for any reversal.
(XIII) Investment real estate
Investment real estate is defined as the real estate with the purpose to earn rent or capital
appreciation or both, including the rented land use rights and the land use rights which
are held and prepared for transfer after appreciation, the rented buildings.
The Company adopts the cost model for measurement on current investment real estate.
Concerning the investment real estate measured by cost model, buildings for rent-used
adopts the same depreciation policies of fixed assets as the Company used; land use
rights for rent-used adopts the amortization policies same to intangible assets.
If the recoverable value of an asset is lower than its book value, relevant impairment
losses should be recognized.
Once impairment of investment real estate was recognized, it will not be written back in
the subsequent fiscal periods.
(XIV)Fixed assets
1. Recognition of fixed assets
Fixed assets is defined as the tangible assets which are held for the purpose of producing
goods, providing services, lease or for operation & management, and have more than one
year of service life. Fixed assets should be recognized for qualified the followed
conditions at the same time:
(1) It is probable that the economic benefits associated with the assets will flow into the
Company; and
(2) The cost of the assts can be measured reliably.
2. Depreciation on various fixed assets
Fixed assets are withdrawal by classification on the age average basis, according to the
categories, predicted service life and predicted net salvage, depreciation was recognized.
54
Depreciation term and annual depreciation of various fixed asets are as:
Depreciation Annual
Fixed asset categories Salvage value
term(year) depreciation ratio
Buildings: Consistenc– Production
35 years 5% 2.71%
buildings
– Non-production
40 years 5% 2.38%
buildings
Temporary buildings 9 years 5% 10.56%
Equipment & machinery 12 years 5% 7.92%
Transportation tools 9 years 5% 10.56%
Other equipment 6 years 5% 15.83%
3. Impairment test on fixed asset and providing of impairment provision
Judging the fixed assets at each period-end for probably evidence of impairment exists.
If evidence of impairment has been found on fixed assets, evaluate its recoverable value.
The recoverable value was determined by the higher one between the amount of fair
value of the fixed assets minors the net amount after disposal expenses and the current
value of predicted cash flow in future of the fixed assets.
While the recoverable amount of the fixed assets lower its carrying value, the carrying
value should be reduced counted as recoverable amount. The reduced amount recognized
as impairment losses for fixed assets reckoned into current gains and losses and
withdrawal relevant impairment losses for fixed assets.
After the impairment losses being recognized, depreciation of the impairment on fixed
assts should be adjusted correspondingly in future period. And during the rest of service
life, the fixed assts should be amortized the book value of fixed assts (with predicted net
salvage deducted) after adjustment systematically.
Once fixed asset impairment is recognized, it shall not be written back in subsequent
fiscal periods.
When evidence showing that impairment has occurred, the recoverable value shall be
assessed. Assessment of recoverable value is based on individual asset. If the
recoverable value was hard to evaluate separately, it shall be decided along with the
group of assets it belongs to.
(XV) Construction in process
1. Category of construction in process
Construction in process is calculated at categorized initiated projects.
2. Standard and point of time for construction in process carrying forward to fixed
assets
Fixed asset is booked with the entire expenditures occurred in the construction in process
till it arrives at predicted state for use. For those constructions in process of fixed assets
which have already arrived at the predicted state for use, while still with absence of
completion settlement, they shall be carried forward to fixed assets at the estimated value
based on engineering budget, construction cost or actual cost commencing from the date
of arrival of the predicted state for use. Meanwhile, they shall be also subject to the
depreciation policies applicable to fixed assets of the Company for provision of
depreciation. Once completion settlement is made, the original temporary estimated
value shall be adjusted at the effective cost. However, the original provision of
55
depreciation remains unchanged.
3. Methods of impairment testing and provision of impairment reserve for
construction in process
The Company makes judgment at end of each year on whether there is indication
showing that impairment is likely to happen in construction in process.
In case of existence of impairment indication in construction in process, the recoverable
amount thereof shall be estimated. And the recoverable amount is confirmed at fair value
of construction in process less the higher of net amount after disposal expense and
present value of predicted future cash flow of such construction in process.
In the event that the recoverable amount of construction in process is lower than its
carrying value, then the carrying value shall be reduced to the recoverable amount, and
the reduced part is recognized as impairment loss of such construction in process through
current gains and losses. Meanwhile, corresponding impairment reserve for construction
in process shall be provided.
Once impairment loss is recognized in construction in process, it will not be reversed in
subsequent accounting periods.
Should be there any indication showing possible impairment of one item construction in
process, enterprise will estimate its recoverable amount based on the single construction
in process. If enterprise has difficulty in estimating recoverable amount of such single
construction in process, it shall turn to estimation of the recoverable amount of the assets
portfolio to which such single construction in process belongs.
(XVI) Borrowing expenses
1. Recognition of the borrowing expenses capitalization
Borrowing expenses that attributed for purchasing or construction of assets that are
complying with capitalizing conditions start to be capitalized and counted as relevant
assts cost; other borrowing expenses, reckoned into current gains and losses after
expenses recognized while occurred.
Assets satisfying the conditions of capitalization are those assets of fixed, investment real
estate etc. which need a long period of time to purchase, construct, or manufacturing
before becoming usable.
Capitalizing for borrowing expenses by satisfying the followed at same time:
(1) Assets expense occurred, and paid as expenses in way of cash, non-cash assets
transfer or debt with interest taken for purchasing, constructing or manufacturing assets
that complying with capitalizing condition;
(2) Borrowing expenses have occurred;
(3) Necessary activities occurred for reaching predicted usable statues or sale-able status
for assets purchased, constructed or manufactured.
2. Period of capitalization
Capitalizing period was from the time star capitalizing until the time of suspended
capitalization. The period for borrowing expensed suspended excluded in the period.
If purchasing, construction, or manufacturing process of an asset satisfying the
conditions of capitalization reached its predicted usable status or sale-able status,
56
capitalization suspended for borrowing expenses.
If purchasing, construction, or manufacturing process of an asset satisfying the
conditions of capitalization completed projects and usable independently for part of the
projects, borrowing expenses for this kind of assts shall suspended capitalization.
If the assets have been completed in every part, but can be reached the useful status or
sale-able status while completed entirely, the borrowing expense shall be suspended for
capitalization while the assets completely finished in whole.
3. Period of suspended
If purchasing, construction, or manufacturing process of an asset satisfying the
conditions of capitalization is suspended abnormally for over 3 months, capitalizing of
borrowing expenses shall be suspended; the suspended assets that satisfying the
conditions of capitalization meets the necessary procedure of reaching predicted usable
status or sellable status, capitalizing of borrowing expenses shall be resumed. The
borrowing expenses occurred during the period of suspended shall reckon into current
gains and losses until the purchasing, construction, or manufacturing process is resumed
for capitalizing.
4. Calculation for capitalization amount
Interest expenses practically occurred at the current term of a special borrowing are
capitalized after deducting of the bank saving interest of unused borrowed fund or
provisional investment gains
Capitalization amounts of common borrowings are decided by the weighted average of
exceeding part of accumulated asset expenses over the special borrowing assets multiply
the capitalizing rate of common borrowings adopted. Capitalization rates are decided by
the weighted average of common borrowings.
For those expenses with discount or premium, determined the amortizable discount or
premium in every fiscal year by effective interest method, than adjusted interest amount
in every period
(XVII) Biological assets
1. Classification and measurement
Biological assets of the Company refer to the productive biological assets with initial
measurement by cost. The actual expenses occurred before reached its predicted
production purpose for productive biological assets recognized as cost; the subsequent
expenditure occurred after reached its predicted production purpose for productive
biological assets counted into current gains and losses.
2. Withdrawal method on depreciation of biological assets
Biological assets of the Company refer to the tea plants. For those productive biological
assts that reached it’s predicted productive purpose, withdrawal depreciation by average
age method. The service life was determined by the residual terms of the residual term of
land use after deducting the un-maturity period (5-year) of the tea plants with 5 percent
salvage value calculated. Reviewing the service life, predicted salvage vale and
depreciation method at year-end, if there have difference between the predicted number
and original estimated number or have major changes on way of profit earning, than
adjusted the service life or predicted salvage value or depreciation method as account
estimation variation.
3. Depreciation reserves on biological assets
57
At every end of the year, examine the productive biological assets, if there have evidence
showing that the net realizable vale of recovable amount for productive biological assets
lower its book value, than depreciation provision recognized by the losses provision of
productive biological assts withdrawal and reckoned into current gains and losses; Once
productive biological assets impairment loss was recognized, shall not be written back in
subsequent fiscal periods.
(XVIII) Intangible assets and R&D costs
1. Measurement
(1) Intangible assets are initially measured at cost while obtained.
For those intangible assets purchased from outside, the purchase value, relevant taxes and
other payments attributable to predicted purpose obtained should recognized as cost for
this assts. For those purchased amount that paid overdue exceeded the normal credit
condition, owns financing natures actually, the cost should be recognized based on the
current value while purchased
Intangible assets obtained by means of enterprise mergered under common control,
recognized book-keeping value by the book value of mergered party; Intangible assets
obtained by means of enterprise mergered under different control, recognized
book-keeping value by the its fair value.
For those cost of intangible assets development internally including: the used materials,
labor cost and register charge for development; amortization for other patent and
concession used and interest expense satisfying the capitalization condition during
process of development; other directly expense before reached its predicted useful
purpose.
(2) Subsequent measurement
Analysis and determined the service life for intangible assts while obtained.
Those intangible assets with limited useful life are evenly amortized on straight basis
from the date when they become useable to the end of expected useful life; for those
intangible assts without limited useful life predicted, amortized nothing due to intangible
assts without certain service life.
2. Particular about the estimation on intangible assets with limited service life
Item Predicted useful life Basis
Amortized the actual rest of life after Certificate
Land use right
certificate of land use right obtained of land use right
Actual
Manufacture
20-year situation of the
technology for patent
Company
At end of report term, revising will be performed on the useful life of intangible assets
with limited useful life and the methods of amortizing.
Being revising, the useful life and methods of amortizing for intangible assets at
period-end was same as the previously estimation.
3. Basis for intangible assets without certain service life:
No intangible assts without certain service life has been found in the period-end for the
Company.
4. Withdrawal for depreciation reserve of intangible assets
For those intangible assets with certain service life, conducting impairment testing at
period-end if there has clearly evidence of impairment.
Concerning the intangible assets without certain service life, conducted impairment
58
testing at every end of the term.
Estimated the recovable amount for those intangingble assets with impairment testing
conducted. The recoverable amount was determined by the higher one between the net
amount resulted from fair value for intangible assets minor disposal expenses and current
value of the predicted future cash flow.
If the recoverable amount lower its book value, than the book value shall reckoned as
recoverable amount. The minor amount recognized as depreciation losses for intangible
assets reckoned into current gains and losses. And withdrawal relevant impairment
reserves for intangible assets.
After impairment loses recognized, adjusted correspondingly in future period for
depletion or amortized expenses of intangible assets depreciated, make sure that the book
value (with predicted salvage value deduction) of intangible assets should systematically
amortized after adjustment in rest of the service life of intangible assets.
Once intangible asset impairment loss was recognized, shall not be written back in
subsequent fiscal periods.
When evidence showing that impairment has occurred, estimated its recoverable amount
by individual assets; if the recoverable value was hard to evaluate separately, it shall be
decided along with the group of assets it belongs to.
5. Detail standard for classification on research stage and exploitation stage
Research stage: stage of the investigation and research activities exercising
innovative-ness for new science or technology knowledge obtained and understanding.
Exploitation stage: stage of the activities that produced new or material advance
materials, devices and products that by research results or other knowledge adoption in
certain plan or design before the commercial production or usage.
The expenditure of the research stage in R&D project internally shall reckon into current
gains and losses while occurred.
6. Standards for capitalization satisfaction of expenditure in exploitation state
Intangible assets recognized for expenditure in exploitation stage by satisfying the
followed at same time:
(1) Owes feasibility in technology and completed the intangible assets for useful or for
sale;
(2) Owes the intention for completed the intangible assets and for sale purpose;
(3) Way of profit generated including: show evidence that the products generated from
the intangible assets owes a market or owes a market for itself; if the intangible assets
will use internally, than show evidence of useful-ness;
(4) Possess sufficient technique, financial resources and other resources for the
development of kind of intangible assets and has the ability for used or for sale;
(5) The expenditure attributable to the exploitation stage for intangible assets could be
measured reliably.
(XIX) Long-term deferred expenses
Long-term deferred expense is amortized at straight line method, averagely during the
beneficial period.
(XX)Income recognition
1. Recognition of the income from commodity sales
When main risks and rewards attached to the ownership of goods have been transferred
to the buyer, reserved neither continuous management power nor effective control over
the goods, incoming payment can be measured reliably, relative financial benefit possibly
inflow to the company, cost occurred or will occur can be reliably measured, sales
income of goods is recognized.
59
2. Basis on use right income for transaction assets
Financial benefit attached to the contract is possibly inflow to the company; Overall
income of the contract can be measured reliably. Determined the use right income for
transaction assts respectively as followed:
(1) Amount of interest income: determined by the time and effective interest rate of the
currency capital used by other people.
(2) Amount of income from use: determined by the charge time and calculation method
agreed in the relevant contract or agreement
3. Basis and methods on completion while determined income of labor provided and
income of construct contracts by percentage of completion
When the results of construct contracts can be reliably estimated, income and costs are
recognized at the percentage of completion at the balance sheet day. Percentage of
completion of the construction contracts are decided by estimation of completed work
and other whole work.
Total labor income provided determined by the amount of contract or agreement received
or receivable except the un-fair contract and agreement. At balance sheet date,
recognized current labor income provided by the amount resulted from the total labor
income provided multiplied by the amount of completion process after accumulative
labor income confirmed in previously accounting period deduction; meanwhile,
transferred current labor cost by amount of completion process after accumulative labor
income confirmed in previously accounting period deduction.
If the results of construction contract are not able to reliably estimated at balance sheet
date, treatment as:
(1) Labor cost occurred expected to be compensated; recognized labor income by amount
of labor cost occurred and transferred labor cost at same amount.
(2) Labor cost occurred un-expected to be compensated, reckoned the labor cost occurred
into current gains and losses without labor income recognized.
(XXI)Government grants
1. Type
Governments grants of the Company refer to the monetary and non-monetary assets
obtained from government for free, and are divided into those related to assets and others
related to revenues.
2. Accounting method
Government grants in relation to purchase of long-term assets such as fixed assets or
intangible assets shall be recognized as deferred income, and are recorded in
non-operating income according to service life of such constructed or purchased assets
by installments;
Government grants in relation to revenues, shall be recognized as deferred income upon
acquisition and recorded in current non-operating income during the periods in which
relevant expenses are recognized when such grants are for the purposes of compensating
relevant expenses or losses of an enterprise in future periods; and shall be directly
credited to current non-operating income upon acquisition when such grants are for the
purposes of compensating occurred relevant expenses or losses of an enterprise.
(XXII)Deferred income tax assets and deferred income tax liabilities
1. Reference for recognition of deferred income tax assets
Under the limit of the taxable income which is very likely to be obtained by the
Company for use of offsetting deductible temporary difference, the Company recognizes
the deferred income tax assets arising from such deductible temporary difference.
2. Reference for recognition of deferred income tax liabilities
60
The Company recognizes taxable temporary difference of current and prior periods
which should have been taxed while not paid yet as deferred income tax liabilities, while
other than the temporary differences formed from transactions constituted by
combination of goodwill and non-enterprises, meanwhile, such transactions bring no
affect on accounting profit and taxable income when happening.
(XXIII) Employeess’ remuneration
During accounting period, employees’ remuneration payable is recognized as liabilities
which are recorded in cost of products or services, currrent expense, or cost of fixed
assets or intangible assets in light of different beneficial parties. Subject to relevant
regulations, the Company provides insurance and public reserve according to certain
proportion of monthly salary, and pays them to labor and social security authorities
month by month, and credits relevant expenditures to current costs or expenses.
(XXIV) Predicted liability
Concerning the lawsuit, debt guarantee, deficit contract and restructuring events involved,
if fulfilling of the responsibility may lead to assets payment or labour provide and the
amount can be measured reliably, than predicted liability shall be recognized.
1. Recognition of predictive liabilities
Responsibilities connected to contingent issues and satisfied all of the following
conditions are recognized as predictive liabilities:
(1) The responsibility is a current responsibility undertaken by the Company;
(2) Fulfilling of the responsibility may lead to financial benefit outflow;
(3) The responsibility can be measured reliably for its value.
2. Measurement
Predictive liabilities shall conduct initial measurement by best estimation of expenditures
needed by fulfillment of current responsibilities.
While determined the best estimation, take the risks, uncertainty and periodic value of
currency that connected to the contingent issues into consideration.
For major influence from periodic value of currency, determined best estimation after
discount on future relevant cash out-flow.
Treatment for best estimation:
If the expenditure has a continuous range, and with similar possibility within the range,
the best estimation should determined by the middle value within the range, that is the
average amount between the up and low limit.
If the expenditure has no continuous range, or has a continuous range but with different
possibility within the range, the possibility amount shall determined as the best
estimation while single events involved by contingency; if many events were involved by
contingency, the best estimation shall be determined by various results and relevant
probability.
If the expenses for clearing of predictive liability is fully or partially compensated by a
third party, and the compensated amount can be definitely received, it is recognized
separated as asset. Though the compensated amount shall not greater than the book value
of the predictive liability
(XXV)Accounting method for disposal of income tax
The Company adopts balance sheet debt method to dispose income tax. Interest rate of
enterprise income tax is detailed in Note III.
(XXVI) Changes on major accounting policy and accounting estimation
1. Changes on accounting policy
No changes on accounting policy in the period for Company.
61
2. Changes on accounting estimation
No changes on accounting estimation in the period for Company.
(XXVII) Errors correction on previously period
There are no errors corrections on previously period in the report period.
III. Taxes
Major taxes applicable to he Company: VAT, business tax, urban maintenance and
construction tax, educational surtax and surcharge, enterprise income tax, and housing
property tax as well.
Tax rates for turnover tax: 17% for VAT, 5% for business tax, 1%, 5% or 7% of turnover
tax for urban maintenance and construction tax(the rate adjusted from 1% to 7% since
December 2010 in Shenzhen Areas; 5% adopts in Wuyuan; other areas except the
Shenzhen and Wuyuan adopts 7%), 3% of turnover tax for educational surtax and
surcharge.
Tax rate of enterprise income tax applicable to the Company and its holding subsidiaries
for this report period are as follows:
Name of company Note 2011 2010
The Company 24% 22%
Shenzhen Shenbao Huacheng Science and Controlling
15% 15%
Technology Co.,Ltd. (Shenbao Huacheng )* subsidiary
Branch of Shenbao
Including: Shantou Branch of Shenbao Huacheng 25% 25%
Huacheng
Controlling
Jufangyong Tea Industry Co., Ltd. in Wuyuan
subsidiary of 25% 25%
County (Wuyuan Jufangyong)
Shenbao Huacheng
Shenzhen Shenbao Sanjing Food & Beverage Wholly-owned
24% 22%
Development Co., Ltd. (Shenbao Sanjing) subsidiary
Including: Guangdong Shenbao Food Co., Ltd. Controlling
(Guangdong Shenbao) subsidiary of 25% 25%
Shenbao Sanjing
Huizhou Shenbao Technologies Co., Ltd. (Huizhou Wholly-owned
25% 25%
Shenbao Technologies) subsidiary
Shenzhen Shenbao Properties Management Co., Wholly-owned
24% 22%
Ltd. (Shenbao Properties) subsidiary
Shenzhen Shenbao Industrial Trading & Wholly-owned
Development Co., Ltd. (Shenbao Industrial subsidiary 24% 22%
Trading & Developmen)
Huizhou Shenbao Industrial Investment Co., Ltd. Wholly-owned
25% 25%
(Huizhou Shenbao Investment) subsidiary
* Shenbao Huacheng, a controlling subsidiary of the Company, has been granted High-tech Enterprise
Certification (No. GR200844200244) jointly promulgated by Shenzhen Technology & Information
Bureau, Bureau of Finance of Shenzhen, Shenzhen Municipal Bureau of State Taxation and
Shenzhen Municipal Bureau of Local Taxation as at the date of 2 March 2009. Such certificate was
released on 16 December 2008, with a valid term of 3 years. With relevant preferential policies
adopted by the State in favor of high-tech enterprises, all qualified high-tech enterprises are able to
enjoy the lower income tax rate of 15% for collection of enterprise income tax, capable for 3 years
commencing from the year when they are deemed as qualified. Shenbao Huacheng has favored from
this preferential policy from 2008 to 2010. Recently, Shenbao Huacheng handling with the
re-approval on high technology enterprises, enterprises income tax was paid on rate of 15% temporary.
62
IV. Business combination and consolidated financial statements
(I) Particular about subsidiary
1. Subsidiaries obtained by establishment or investment
Proportion of The
shares held balance
after the
parent
company’s
owner’s
equity
The writing
sum of down the
money excess of
in the current
Actual minorit loss
Place of investmen Proportio y equity undertaken
Minorit
Type registrati Nature of Register Business t amount n of Consolidati which by minority
Subsidiaries y
on business capital scope at Directl Indirectl voting on or not is used shareholder
equity
period-en y y right to write s of eth
d down subsidiary
the over the
minorit share
y enjoyed by
interest minority
shareholder
s in the
original
owners’
equity of
the
subsidiary
Shenzhen RMB Production RMB
Controlling
Shenbao Shenzhen Manufacture 103.451 and sales 118.551 100% --- 100% Yes --- --- ---
subsidiary
Huacheng 3 of 8
63
Science and million concentrate million
Technology d tea juice
Co.,Ltd.*1 and instant
tea powder
Production
Shenzhen and
Shenbao Sanjing operation
RMB RMB
Food & Wholly-own of drinks,
Shenzhen Manufacture 30.15 80.5208 100% --- 100% Yes --- --- ---
Beverage ed non-staple
million million
Development foods and
Co., Ltd. food
additives
Industrial
investment,
property
Huizhou manageme
Shenbao Wholly-own Huizhou Comprehensi RMB 4 nt, RMB 4
100% --- 100% Yes --- --- ---
Technologies ed GD ve million preparing million
Co., Ltd. the
production
project of
condiments
Shenzhen
Manageme
Shenbao
Wholly-own Property RMB 5 nt of RMB 5
Properties Shenzhen 51% 49% 100% Yes --- --- ---
ed management million self-owned million
Management
properties
Co., Ltd.*2
Shenzhen
Shenbao
RMB RMB
Industrial Wholly-own Commercial Commercia
Shenzhen 5.5 5.5 100% --- 100% Yes --- --- ---
Trading & ed wholesale l wholesale
million million
Development
Co., Ltd.
Huizhou Wholly-own Huizhou Information RMB 5 Industrial RMB 5
100% --- 100% Yes --- --- ---
Shenbao ed GD consultancy million investment million
64
Industrial s and
Investment Co., consultanc
Ltd. y of
logistics
informatio
n
Shenzhen
Shenbao(Liaoyu RMB To be RMB
an) Industrial Shareholdin 2.378 launched 0.576 53.5
Shenzhen --- --- 53.5% No --- --- ---
Co., Ltd. g milli for official millio %
(Shenbao on operation n
Liaoyuan) *3
*1. On 22 June 2011, the Company placed RMB ordinary share (A-Share) of 68,977,066 shares privately to specific targets with carrying value of 1.00 yuan each,
placing subscription price of 8.70 yuan per share. The placing totaling raised fund of 600,100,474.20 yuan. Among which, 4 natural persons purchased the privately
offering shares of the Company by 48.33 percent equity of Shenbao Huacheng held by hand with consideration of 65,100,481.80 yuan, at the same time Shenbao
Huacheng turned to be the wholly-owned subsidiary of the Company. Changed procedures for Industrial and Commerce has been done on 8 June 2011.
*2. Shenzhen Shenbao Properties Management Co., Ltd: its 49% equity interests were held by Shenzhen Shenbao Sanjing Food & Beverage Development Co., Ltd., a
wholly-owned subsidiary of the Company.
65
*3. Shenzhen Shenbao (Liaoyuan) Industrial Company: though it was not a short that the company
had been established for, it never conducted normal operation. Since its operation license has been
revoked, the Company has made full provision of long-term investment impairment reserve for the
investment made to such company. Financial statements of such company have not been included in
the consolidated financial statements.
V. Notes to main items of consolidated financial statements
(the following figures are denominated in RMB in absence of special indications)
(I) Monetary fund
At the end of term Beginning of term
Item Original translatio Converted into Original translat Converted into
currency n rate RMB currency ion rate RMB
Cash --- --- --- --- --- ---
RMB 375,974.70 1.0000 375,974.70 186,160.62 1.0000 186,160.62
HKD 4,690.83 0.8316 4,135.37 4,690.83 0.8509 4,135.37
USD 99.05 6.4716 655.98 99.05 6.6227 655.98
Sub-total --- --- 380,766.05 --- --- 190,951.97
Bank deposit --- --- --- --- --- ---
587,076,378.8
RMB 1.0000 587,076,378.86 40,296,049.96 1.0000 40,296,049.96
6
EURO 450.13 9.3612 3,964.17 449.89 8.8065 3,962.05
HKD 13,321.93 0.8316 11,709.90 13,321.11 0.8509 11,717.02
USD 49,360.21 6.4716 319,443.18 5,662.09 6.6227 37,498.32
Sub-total --- --- 587,411,496.11 --- --- 40,349,227.35
Other
monetary --- --- --- --- --- ---
funds
RMB --- --- --- 20,000,000.00 1.0000 20,000,000.00
Sub-total --- --- --- --- --- 20,000,000.00
Total --- --- 587,792,262.16 --- --- 60,540,179.32
Details of restricted monetary capital:
item Balance as at period-end Balance as at period-begin
Fixed deposit (saved in Ping An
--- 20,000,000.00
Bank)charged for borrowings
Total --- 20,000,000.00
Balance of monetary fund at period-end increase 527,252,082.84 yuan over that of period-beginning
with 870.91 percent up mainly due to capital of privately stock offering in this period was transferred
into the account.
(II) Transaction financial assets
66
Balance as at Method for recognition
Item Balance as at period-end
period-begin of fair value
Transactional equity
262,500.00 304,500.00 Market value
instrument investment
Financial assets measured by
fair value and with variation
17,334,869.55 --- Ruling
accounted into current
gains/losses *
Total 17,597,369.55 304,500.00
*Details found in Note*2 of (XXXVIII) contained in “Note V”.
(III) Account receivable
1. Account receivable classified according to categories
Balance as at period-end Balance as at period-begin
Portion Portion
categories Portion of bad Portion of bad
Bad debt Carrying Bad debt
Carrying value in total debt in total debt
provision value provision
% provisi % provisi
on % on %
I. Account
receivable with
single major amount
--- --- --- --- --- --- --- ---
and withdrawal bad
debt provision for
single item
II. Account
receivable
61,979,353.3
withdrawal bad debt 47,262,573.03 70.91 1,331,582.44 2.82 75.65 1,331,582.44 2.15
4
provision by age
combination
III. Account
receivable with
single minor amount 19,945,359.4 19,668,180.6
19,391,001.77 29.09 19,391,001.77 100.00 24.35 98.61
but withdrawal bad 8 3
debt provision for
single item
81,924,712.8 20,999,763.0
total 66,653,574.80 100.00 20,722,584.21 31.09 100.00 25.63
2 7
Explanation for categories of account receivable:
In combination, account receivable withdrawal bad debt provision by age combination
Balance as at period-end Balance as at period-begin
Proportio Proporti
age Portion n of bad Portion on of
Bad debt Carrying Bad debt
Carrying value in total debt in total bad debt
provision value provision
% provision % provisio
% n%
Within 1 year (1 37,695,682.59 79.76 --- --- 52,412,462.9 84.56 --- ---
67
year included) 0
1-2years (2years
551,314.93 1.17 13,168.94 2.39 551,314.93 0.89 13,168.94 2.39
included)
2-3years( 3 years
668,096.48 1.41 67,041.99 10.03 668,096.48 1.08 67,041.99 10.03
included)
over 3 years 8,347,479.03 17.66 1,251,371.51 14.99 8,347,479.03 13.47 1,251,371.51 14.99
61,979,353.3
Total 47,262,573.03 100.00 1,331,582.44 2.82 100.00 1,331,582.44 2.15
4
2 Account receivable with major single amount or minor amount but conducting
impairment testing independently at period-end:
Withdrawal
bad debt provision
Item of account receivable Carrying value proportion reasons
amount
(%)
Account receivable for
1,201,994.07 1,201,994.07 100.00 Hard to recover
sales of tea powder
Before 1998, formed due to
Account receivable for
18,189,007.70 18,189,007.70 100.00 history reasons, hard to
other sales
recover.
total 19,391,001.77 19,391,001.77 100.00
3. Changes of the bad debt provision for account receivable
amount amount decreased in this Carrying
Carrying balance period
item withdrawal in balance at
at period-begin
this period Turn-back Turn-off period-end
2011(this period) 20,999,763.07 --- 70,619.95 206,558.91 20,722,584.21
4. No arrear made by shareholders units holding over 5% (5% included) voting
rights of the Company appeared in the account receivables as at period-end
5. Account shall be receivable from related parties as at period-end
6. The top 5 arrears in account receivables as at period-end
Relationship with the Proportion in total
Name of the unit Amount Term
Company account receivable (%)
Customers I Major customer 4,836,162.00 within 1 year 7.26
Customers II Major customer 3,558,079.00 within 1 year 5.34
Customers III Major customer 2,727,170.00 within 1 year 4.09
Customers IV Major customer 2,153,240.00 within 1 year 3.23
Customers V Major customer 1,922,883.00 over 3 years 2.88
7. Balance of account receivable at period-end decrease 15,271,138.02 yuan over that
of period-begin with decrease rate of 18.66 percent. The decrease mainly due to the
amount for tea products have been received by Shenbao Huancheng, subsidiary of
the Company.
68
(IV) Account paid in advance
1. Aging analysis
Balance at period-end Balance at period-begin
A/C age
Amount Ratio% Amount Ratio%
within 1 year (1 year
4,780,178.19 91.68 6,111,501.54 93.37
included)
1 to 2 years (2 year
366,923.55 7.04 366,923.55 5.61
included)
2 to 3 years (3 year
16,657.20 0.32 16,657.20 0.25
included)
Over 3 years 50,067.00 0.96 50,067.00 0.77
Total 5,213,825.94 100.00 6,545,149.29 100.00
2. The top 5 units in account paid in advance
relationship with the Reasons for
Units amount Age
Company outstanding
Customers I Non-related party 1,141,136.64 within 1 year Goods not received
Customers II Non-related party 644,800.00 within 1 year Goods not received
custom tax paid in
Customers III Non-related party 206,274.68 within 1 year
advance
inspection fee paid
Customers IV Non-related party 144,380.00 within 1 year
in advance
consultancy fee paid
Customers V Non-related party 66,000.00 within 1 year
in advance
3. No arrear made by shareholders units holding over 5% (5% included) voting rights of
the Company appeared in the account paid in advance as at period-end.
4. Balance of account paid in advance at period-end decrease 1,331,323.35 yuan
over that of period-beginning with decrease rate of 20.34 percent for materials
amount paid in advance has been settlement by Shenbao Huacheng, subsidiary of
the Company.
(V) Other receivables
1. Other account receivable classified according to categories
Balance as at period-end Balance as at period-begin
Propor Portion Proport Portion
categories tion in of bad ion in of bad
Bad debt Bad debt
amount total debt amount total debt
provision provisi provision provisi
amoun amount
t (%) on %) (%) on %
I. Other account
receivable with
single major
amount and --- --- --- --- --- --- --- ---
withdrawal bad
debt provision
for single item
69
II. Other account
receivable
20,747,330.
withdrawal bad 54.24 1,606,670.64 7.74 58,163,056.68 76.87 1,606,670.64 2.76
23
debt provision by
age combination
III. Other
account
receivable with
single minor 17,503,936. 17,503,936.0 17,503,936.0
45.76 100.00 17,503,936.07 23.13 100.00
amount but 07 7 7
withdrawal bad
debt provision
for single item
38,251,266. 19,110,606.7 19,110,606.7
Total 100.00 49.96 75,666,992.75 100.00 25.26
30 1 1
Notes to category of other account receivable:
In combination, other account receivable withdrawal bad debt provision by age
combination
Balance as at period-end Balance as at period-begin
Proport Portion Proport Portion
age ion in of bad ion in of bad
Bad debt Bad debt
amount total debt amount total debt
provision provision
amount provisi amount provisi
(%) on % (%) on %
Within 1 year (1 43,603,713.3
6,188,526.86 29.83 --- --- 74.97 --- ---
year included) 1
1-2years (2years
2,554,390.34 12.31 127,723.85 5.00 2,554,930.34 4.39 127,723.85 5.00
included)
2-3years( 3 years
5,195,864.18 25.04 519,586.42 10.00 5,195,864.18 8.93 519,586.42 10.00
included)
over 3 years 6,808,548.85 32.82 959,360.37 14.09 6,808,548.85 11.71 959,360.37 14.09
20,747,330.2 1,606,670.6 58,163,056.6 1,606,670.6
Total 100.00 7.74 100.00 2.76
3 4 8 4
2. Other account receivable with major single amount or minor amount but
conducting impairment testing independently at period-end
Withdrawal
bad debt provision
Item Carrying value proportion reasons
amount
(%)
Account with over 3 Formed due to
years for recovered 17,503,936.07 17,503,936.07 100.00 history reasons, hard
difficulties to recover.
Total 17,503,936.07 17,503,936.07 100.00
3. Changes of the bad debt provision for other account receivable
Carrying Amount Amount decreased in Carrying
this period Other
Item balance at withdrawal in balance at
decreased
period-begi this period Turn-back Turn-off period-end
70
n
2011(this 19,110,606.71 540.00 --- 540.00 --- 19,110,606.71
period)
4. No arrear made by shareholders units holding over 5% (5% included) voting
rights of the Company appeared in the other receivables as at period-end.
5. Other receivable due from related parties as at period-end
Relationship with the Proportion in total other
Name of the unit Amount
Company account receivable (%)
Changzhou Sanjing Oil Co.,
Associated company 15,060,609.65 39.37
Ltd.
6. The top 5 amounts in other account receivables
Relationship Portion in
Name of the unit with the Nature of content Amount Book age total other
Company receivables %
Changzhou Sanjing Oil Co., Associated
current amount 15,060,609.65 1-3years 39.37
Ltd. company
Shenzhen Jinsailong Non-related equipment refund
820,000.00 over 3years 2.14
Equipment Company party receivable
Beijing H&J Consulting Co., Non-related
current amount 576,000.00 within 1 year 1.51
Ltd. party
Amount for land
Administration Committee of
Non-related purchased
Industrial Zone of Wuyuan 494,479.00 over 3years 1.29
party without
County
settlement
Turn-over capital
employee of for business of
Liu Cun 274,000.00 within 1 year 0.72
the Company office
representative
7. Balance of other account receivable at period-end decreased 37,415,726.45 yuan
over that of period-begin with decrease rate of 49.45 percent. Mainly because the
transfer balance payment receivable of RMB 23 million paid by PepsiCo (China)
Investment Corp. for 5% equity of Shenzhen Pepsi Coke-Cola Beverage Co., ltd.
held by the Company was received; and balance payment of RMB 12.95 million of
the land reserves fund have been received from Wuyuan Land Reserve Center, the
land reserves of 40,000 m2 residential lands located in Longtian Rd. Industrial Zone,
Ziyang Town, Wuyuan with serials of WGY(2009) No. 1383.
(VI) Inventory and inventory impairment provision
1. Classification
Balance at period-end Balance at period-begin
Item Depreciation Depreciation
Book balance Book value Book balance Book value
provision provision
18,165,152.1
Raw materials 21,741,903.93 3,576,751.78 23,266,921.98 3,576,751.78 19,690,170.20
5
71
Packaging
2,220,243.01 --- 2,220,243.01 230,347.83 --- 230,347.83
materials
Product in 15,409,617.2
15,409,617.24 --- 9,956,224.07 --- 9,956,224.07
process 4
Stock 18,837,027.9
19,302,165.02 465,137.05 19,749,782.75 465,137.05 19,284,645.70
products 7
Goods
160,748.03 --- 160,748.03 55,783.81 --- 55,783.81
delivered
Commission
processing 6,234,731.64 5,310,050.23 924,681.41 6,352,095.61 5,310,050.23 1,042,045.38
materials
Low value
840,256.26 --- 840,256.26 2,906,192.42 --- 2,906,192.42
consumable
56,557,726.0
Total 65,909,665.13 9,351,939.06 62,517,348.47 9,351,939.06 53,165,409.41
7
2. Inventory impairment provision
Kinds of Book-balance as Provision for Decrease during this period Book-balance as at
inventories at period-begin this period Reversal Written-off period-end
Raw materials 3,576,751.78 --- --- --- 3,576,751.78
Packaging
--- --- --- --- ---
materials
Stock products 465,137.05 --- --- --- 465,137.05
Commission
processing 5,310,050.23 --- --- --- 5,310,050.23
materials
Total 9,351,939.06 --- --- --- 9,351,939.06
3. No capitalizing amount of borrowing fees that reckoned into inventory costs in this period.
(VII) Long-term equity investment
Balance as at period-end Balance as at period-begin
Item Book Provision Carrying Book Provision
Carrying value
balance reserve value balance reserve
Investments under
66,724,129.91 2,870,000.00 63,854,129.91 68,789,379.14 2,870,000.00 65,919,379.14
equity method
Investments
to joint venture --- --- --- --- --- ---
company
Investments
66,724,129.91 2,870,000.00 63,854,129.91 68,789,379.14 2,870,000.00 65,919,379.14
to associates
Investments under 17,537,628.5
17,595,128.53 57,500.00 17,595,128.53 17,537,628.53 57,500.00
cost method 3
Other equity 17,480,000.0
17,537,500.00 57,500.00 17,537,500.00 17,480,000.00 57,500.00
investment 0
Investments
57,628.53 57,628.53 --- 57,628.53 57,628.53 ---
to subsidiaries
20,407,628.5
Total 84,319,258.44 63,911,629.91 86,384,507.67 20,407,628.53 65,976,879.14
3
72
1. Investments under equity method
(1) Investments to associates under equity method:
Share
Addit
in Initial Equity Cash
ional Investment Accumulated Balance at
Name registe investment changed this dividend
invest retrieved changes period-end
r cost term obtained
ment
capital
Shenzhen
Shenbao
49.14 2,870,000.0
(Xinmin) --- --- --- --- --- 2,870,000.00
% 0
Foods Co.,
Ltd.
Shenzhen
Pepsi
60,179,068. 63,854,129.9
Coke-Cola 25% --- --- (269,528.67) --- 3,675,061.85
06 1
Beverage
Co.,
Changzhou
13,500,000. (13,500,000.0
Sanjing Oil 33% --- --- --- --- ---
00 0)
Co.,
Shenzhen
Shenbao
1,800,000.0
Real Estate 20% --- 1,800,000.00 4,279.44 --- --- ---
0
Developmen
t Co., *
78,349,068. 66,724,129.9
Total --- 1,800,000.00 (265,249.23) --- (9,824,938.15)
06 1
* In this period, 20 percent equity of Shenzhen Shenbao Real Estate Development Co.
was transferred by the Company with investment gains of 1.8 million yuan received.
(2) Particular about joint-venture and associated enterprise
Ratio
Total operating
Registe Business Register of Total assets at Net profit this
Name income this
r place nature capital shares period-end period
period
held
Associated
enterprise
1. Shenzhen
Pepsi Shenzh Beverage US$ 12.5
25% 787,270,546.76 945,341,076.04 (1,078,114.68)
Coke-Cola en products million
Beverage Co.,
2. Changzhou Eatable
Chang RMB 45
Sanjing Oil vegetable oil 33% 16,240,846.89 1,444,579.05 (1,724,487.21)
zhou million
Co., and feed etc.
3.Shenzhen
Shenbao Shenzh License been 49.14
--- --- --- ---
(Xinmin) Foods en revoke %
Co., Ltd.
2. Investments under cost method
(1) Other equity investment under cost method-stock investment:
Categor Amount Portion in Initial Balance as Incre Decr Balance
Name of the Companie
y of of shares the investment at ase ease as at
73
shares registered cost period-begi durin durin period-e
capital n g this g this nd
perio perio
d d
Legal
Beijing Tiantan
person’ 33,333 --- 57,500.00 57,500.00 --- --- 57,500.00
Holdings Co., Ltd.*
shares
Sub-total 57,500.00 57,500.00 --- --- 57,500.00
*: These shares were legal person shares purchased through STAQ trading system. Its
former name was Beijing Shuanghesheng Five Star Beer Sanhuan Co., Ltd. The
Company was originally holding 55,000 shares as investment, and was changed to
33,333 shares after implementation of the share exchange and renaming program.
(2)Other equity investment and investment to subsidiaries under cost method
Incre Decre
ase ase
Inves Share in Initial
Balance as at durin durin Balance as at
Name of the Companies tment registere investment
period-begin g this g this period-end
term d capital costs
perio perio
d d
Shenzhen Sanjiu Weitai --- 0.95% 2,480,000.00 2,480,000.00 --- --- 2,480,000.00
Holdings Co., Ltd.
Shenzhen Taiji
Optical-Electric --- 3.77% 15,000,000.00 15,000,000.00 --- --- 15,000,000.00
Technologies Co., Ltd.
10
Shenbao Liaoyuan 53.50% 57,628.53 57,628.53 --- --- 57,628.53
years
Subtotal 17,537,628.53 17,537,628.53 --- --- 17,537,628.53
3. Impairment provision for long-term equity investment
Decrease during this period
Increase Carried Carried
Balance as at Balance as at
Company during this back for out for
period-begin Total period-end
period restoring of other
price reason
Shenzhen Taiji
Optical-Electric 15,000,000.00 --- --- --- --- 15,000,000.00
Technologies Co., Ltd *1
Shenzhen Sanjiu Weitai 2,480,000.00 --- --- --- --- 2,480,000.00
Holdings Co., Ltd.
Shenzhen Shenbao
(Xinmin) Foods Co., 2,870,000.00 --- --- --- --- 2,870,000.00
Ltd.*2
Shenzhen Liaoyuan *2 57,628.53 --- --- --- --- 57,628.53
Total 20,407,628.53 --- --- --- --- 20,407,628.53
*1: Since this company was established, it was improperly managed and in loss condition.
Impairment provision has been provided at the balance between the predicted retrievable
amount and the book value.
*2: These two companies have been established for years. At present they have been
revoked with business licenses. Due to that they haven’t been wounded up yet,
74
impairment provisions was provided in full upon them.
(VIII) Fixed assets and accumulated depreciation
1. Fixed assts
Balance as at Increase during Decrease during Balance as at
Item
period-begin this period this period period-end
1. Total book original value 255,224,084.21 1,377,737.59 3,776,678.42 252,825,143.38
Including: House buildings 106,760,867.61 159,073.02 --- 106,919,940.63
Machinery equipments 134,771,836.76 604,326.45 3,582,209.54 131,793,953.67
Transportation tools 6,966,221.99 277,199.00 148,707.00 7,094,713.99
Other equipments 6,725,157.85 337,139.12 45,761.88 7,016,535.09
2. Total accumulated
97,625,129.74 5,028,087.18 3,403,294.62 99,249,922.30
depreciation
Including: House buildings 7,589,834.89 1,421,319.24 --- 9,011,154.13
Machinery equipments 80,977,276.90 3,142,925.07 3,245,928.89 80,874,273.08
Transportation tools 4,550,987.04 233,828.07 141,271.65 4,643,543.46
Other equipments 4,507,030.91 230,014.80 16,094.08 4,720,951.63
3. Total net book value of
157,598,954.47 --- --- 153,575,221.08
fixed assets
Including: House buildings 99,171,032.72 --- --- 97,908,786.50
Machinery equipments 53,794,559.86 --- --- 50,919,680.59
Transportation tools 2,415,234.95 --- --- 2,451,170.53
Other equipments 2,218,126.94 --- --- 2,295,583.46
4. Total impairment
2,978,108.36 --- 331,407.17 2,646,701.19
provision
Including: House buildings --- --- --- ---
Machinery equipments 2,978,108.36 --- 331,407.17 2,646,701.19
Transportation tools --- --- --- ---
Other equipments --- --- --- ---
5. Total book value of fixed
154,620,846.11 --- --- 150,928,519.89
assets
Including: House buildings 99,171,032.72 --- --- 97,908,786.50
Machinery equipments 50,816,451.50 --- --- 48,272,979.40
Transportation tools 2,415,234.95 --- --- 2,451,170.53
Other equipments 2,218,126.94 --- --- 2,295,583.46
In the period, the amount transfer in fixed assets from construction in process was
437,636.21 yuan.
2. No idle fixed assets temporary at period-end.
3. There was no fixed asset leased in through financing leasing or leased out by
operation leasing as at period-end.
4. Fixed assets without un-completed property certificates at period-end
75
Reasons for un-completed Times expected for certificate
Item Book value certificate completed
Administration
comprehensive In process of handling Within the year of 2011
14,912,221.18
building of Huizhou
Huizhou spice
In process of handling Within the year of 2011
production plant 7,686,507.21
Huizhou equipment
1,514,370.49 In process of handling Within the year of 2011
plant
Huizhou beverage
10,371,685.46 In process of handling Within the year of 2011
production plant
Huizhou beverage
4,335,573.65 In process of handling Within the year of 2011
warehouse
Huizhou power
allocation room and
2,526,439.55 In process of handling Within the year of 2011
machinery fixed
room
Dormitory of the Handle after new policy
Shantou branch of 2,673,964.45 New plan for aged district carried out, the company
Shenzhen Huacheng plans for sale recently
5. Fixed assets used for mortgage or guarantee as at period-end were detailed in
Note VIII.
(IX) Construction in process
Balance as at period-end Balance as at period-begin
Item
Provision Provision
Book balance Carrying value Book balance Carrying value
reserve reserve
Shenbao Plaza
3,842,333.64 3,842,333.64 --- 3,842,333.64 3,842,333.64 ---
project
Pre-phase project
in respect of 5,700,863.10 --- 5,700,863.10 4,634,968.12 --- 4,634,968.12
Shenbao Building
Project of
production line
for Shantou
791,699.78 --- 791,699.78 791,699.78 --- 791,699.78
Branch of
Shenbao
Huacheng
Project of
environment
protection for
918,717.15 --- 918,717.15 --- --- ---
Shantou Branch
of Shenbao
Huacheng
Reform project
for production
line of Mingyou
1,386,747.81 --- 1,386,747.81 811,986.33 --- 811,986.33
Tea of
Jufangyong in
Wuyuan
Reform project
199,059.84 --- 199,059.84 --- --- ---
for production
76
line of beverage
Tea of
Jufangyong in
Wuyuan
Production line
project of
1,664,344.32 --- 1,664,344.32 1,027,232.15 --- 1,027,232.15
Shenbao
Huacheng
Other 1,409,424.11 903,189.74 506,234.37 1,150,656.57 903,189.74 247,466.83
15,913，
Total 4,745,523.38 11,167,666.37 12,258,876.59 4,745,523.38 7,513,353.21
189.75
77
1. Changes of major projects under construction
Decrease during Proporti
Increa this period on of Accumulati
Balance as Balance
se project ve amount Fund
at Transferr Progre as at
Project Budget during Other investme of interest sourc
period-beg ed to ss (%) period-e
this decrea nt in capitalizati e
in fixed nd
period se budget on
assets
(%)
Found in
Shenbao 4,634,968.12
1,065,894.
--- --- --- ---
explanati
--- on of (II) 5,700,863.10
98
Building in Note
IX
Productio
n line of RMB
1,074,748. Other
Shenbao 2.7 1,027,232.15
38
437,636.21 --- 110 95 ---
resource
1,664,344.32
Huachen million
g
Project of
environme
nt
protection RMB
Other
for 1.38 --- 918,717.15 --- --- 66.57 67 ---
resource
918,717.15
Shantou million
Branch of
Shenbao
Huacheng
Productio
n line of
RMB
Shantou Other
1.1 791,699.78 --- --- --- 72 75 ---
resource
791,699.78
Branch of
million
Shenbao
Huacheng
Reform of
the
productio
RMB1
n line of Other
.5 811,986.33 574,761.48 --- --- 92.45 93 ---
resource
1,386,747.81
Mingyou,
million
Wuyuan
Jufangyon
g
Reform
project for
productio
n line of RMB
Other
beverage 0.2 mi --- 199,059.84 --- --- 99.53 99.50 ---
resource
199,059.84
Tea of llion
Jufangyon
g in
Wuyuan
Tota 3,833,181.
--- 7,265,886.38
83
437,636.21 --- --- --- --- --- 10,661,432.00
l
(2)Impairment provision for construction in process
78
Balance as Increase Decrease Balance as
Project at during this during this at Reason for provision
period-begin period period period-end
Shenbao Plaza Changes of plan for
3,842,333.64 --- --- 3,842,333.64
project project design
Others 903,189.74 --- --- 903,189.74 Useless value
Total 4,745,523.38 --- --- 4,745,523.38
3. Particular about progress of the major construction in process
Progress
Project Remarks
(%)
Shenbao building --- Star no construction, minor expenses occurred in pre-phase
Parts of the equipment still in reform in first half year of 2011,
Production line of
95 should be carrying forward after the acceptance of equipment
Shenbao Huacheng
reform in second half year of 2011
Production line of Foundation facilities of the production line project were almost
Shantou Branch of 75 been installed; totally was accepted and settlement by some of
Shenbao Huacheng the equipment in place in 2nd half year of 2011
Environmentally of The project has finished 60 percent to 70percent; totally was
Shantou Branch of 67 accepted and settled by some of the equipment in place in 2nd
Shenbao Huacheng half year of 2011
Reform of the The installation for purchasing of equipment have been
production line of finished in 2010 partially; subsequent installation for
93
Mingyou, Wuyuan purchasing of equipment will finish in 2011 and stands for
Jufangyong acceptance.
Reform of the
production line of The project has been completed basically and ready for
99.5
beverage tea, acceptance procedures for settlement
Wuyuan Jufangyong
4. Balance of construction in process at period-end increase 3,654,313.16 yuan over that of
period-beginning with 29.81 percent up. Increase mainly because: production line of Shenbao
Huacheng increased 637,112.17 yuan; reform project for processing line of Wuyuan Minyou
Teas increased 574，761.48 yuan and environment project for Shantou Branch of Shenbao
Huacheng increased 918,717.15 yuan.
(X) Productive biological assets
1. Measured by cost
Balance at Increased in Decreased in the Balance at
Item
period-begin the period period period-end
Tea plant 242,021.00 27,995.00 --- 270,016.00
Total 242,021.00 27,995.00 --- 270,016.00
2. Impairment provision for productive biological assets
Increased
Balance at Decreased in Balance at Reasons for
Item in the
period-begin the period period-end withdrawal
period
Tea plant --- --- --- ---
79
Total --- --- --- ---
The Company withdrawal no impairment provision for productive biological assets
for no recoverable amount lower than its book value found at period-end.
(XI) Intangible assets
Balance at Increased in the Decreased in the Balance at
Item
period-begin period period period-end
I. Total of original value 203,231,136.20 17,770,016.85 --- 221,001,153.05
1. Land using right * 176,163,763.16 17,770,016.85 --- 193,933,780.01
2. Patent technologies 25,199,183.39 --- --- 25,199,183.39
3. Use right of forest 1,868,189.65 --- --- 1,868,189.65
II. Total accumulated
15,863,192.99 2,738,022.32 --- 18,601,215.31
amortization
1. Land using right 6,378,929.75 2,036,235.86 --- 8,415,165.61
2. Patent technologies 9,378,399.15 683,104.56 --- 10,061,503.71
3. Use right of forest 105,864.09 18,681.90 --- 124,545.99
III. Total of intangible asset
--- --- --- ---
impairment provisions
1. Land using right --- --- --- ---
2. Patent technologies --- --- --- ---
3. Use right of forest --- --- --- ---
IV. Total of intangible asset
187,367,943.21 --- --- 202,399,937.74
book value
1. Land using right 169,784,833.41 --- --- 185,518,614.40
2. Patent technologies 15,820,784.24 --- --- 15,137,679.68
3. Use right of forest 1,762,325.56 --- --- 1,743,643.66
* According to the general planning requirement from land planning dept of Huizhou City on
processing logistic zone of Shenbao products, road areas of 36,639.21 m2 was amortized by the
Company with expenses of 17,770,016.85 in total. The amount was transferred to land use right of
intangible assets in this period.
As indicated by the item-by-item inspection of the Company conducted at year-end, there was no such
event that the recoverable amount of intangible assets were lower than carrying value, thus no
impairment provision for construction in process was provided.
Book value of intangible assets used for mortgage or guarantee at period-end amounting to
124,037,977.21 yuan, more details found in Note VIII.
Among which, the followings were included in land use right:
Original value Remaining
Area of land Accumulated Balance as at
Location of land using amortization
(Squre meter) amortization period-end
right period
Shenzhen Tianbei 2,776.80 62,886,780.00 1,406,142.81 61,480,637.19 429 months
Huizhou Ruhu Town 14,073.00 6,912,605.17 457,527.04 6,455,078.13 549 months
Huizhou Ruhu Town 15,856.00 10,129,607.64 467,585.36 9,662,022.28 568 months
Huizhou Ruhu Town 11,282.90 5,542,118.45 366,818.10 5,175,300.35 549 months
Huizhou Ruhu Town 7,856.00 3,858,837.93 255,406.11 3,603,431.82 549 months
Huizhou Ruhu Town 17,860.00 8,772,765.47 580,646.29 8,192,119.18 549 months
Huizhou Ruhu Town 32,882.00 18,951,515.90 1,289,829.33 17,661,686.57 551 months
Huizhou Ruhu Town 50,038.00 31,966,782.74 1,771,340.74 30,195,442.00 526 months
80
Huizhou Ruhu Town 44,995.00 28,745,061.54 996,818.68 27,748,242.86 576 months
Huizhou Ruhu Town 5,157.00 3,294,550.11 114,248.11 3,180,302.00 576 months
Wuyuan County
Ziyang Town Industry 115,605.00 8,459,701.00 596,214.86 7,863,486.14 546 months
Zone
Wuyuan County
Ziyang Town 4,176.00 4,413,454.06 112,588.18 4,300,865.88 764 months
Dazhangshan Road
185,518,614.4
Total 193,933,780.01 8,415,165.61
0
(XII) Long-term deferred expense
Amortization Reasons
Balance at Increased in Other Balance at
Item during this for other
period-begin the period decrease period-end
period decrease
Office decoration fee 193,000.00 183,000.00 158,920.00 --- 217,080.00
3 years term of
comprehensive property 46,131.51 --- 12,034.26 --- 34,097.25
insurance
Decoration charge for
1,017,626.68 --- 127,203.36 --- 890,423.32
rented office
Project of maintenance
reform on canned
379,494.03 50,182.37 38,592.60 --- 391,083.80
warehouse and waste tea
house
Affiliated project of
resident area in 405,566.00 --- 41,244.00 --- 364,322.00
Jufangyong Wuyuan
Others 74,171.92 70,794.41 12,291.66 --- 132,674.67
Total 2,115,990.14 303,976.78 390,285.88 --- 2,029,681.04
(XIII) Deferred income tax assets
1. Recognized deferred income tax assets
Item Balance as at period-end Balance as at period-begin
Impairment provision for assets 2,595,233.33 2,595,233.33
Subtotal 2,595,233.33 2,595,233.33
2. Un-recognized deferred income tax assets
Item Balance as at period-end Balance as at period-begin
Deductible temporary difference 66,627,849.35 66,627,849.35
Total 66,627,849.35 66,627,849.35
3. The Company had no deductible losses in respect of unrecognized deferred
income tax assets.
(XIV) Asset impairment provision
81
Increase Decrease during this
Balance as at period Other Balance as at
Item during this
period-begin decrease period-end
period Reversal Written-off
Bad debt reserve 40,110,369.78 540.00 70,619.95 207,098.91 --- 39,833,190.92
Inventory impairment
9,351,939.06 --- --- --- --- 9,351,939.06
provision
Long-term equity
investment impairment 20,407,628.53 --- --- --- --- 20,407,628.53
provision
Fixed asset impairment
2,978,108.36 --- --- 331,407.17 --- 2,646,701.19
provision
Construction-in-proces
4,745,523.38 --- --- --- --- 4,745,523.38
s impairment provision
Impairment provision
for productive --- --- --- --- --- ---
biological assets
Total 77,593,569.11 540.00 70,619.95 538,506.08 --- 76,984,983.08
(XV) Short-term loans
Type of Loans Balance as at period-end Balance as at period-begin
Guarantee loans 55,000,000.00 ---
Mortgage loans --- 19,000,000.00
Guarantee + Mortgage loans --- 16,400,000.00
Guarantee + Mortgage loans 20,000,000.00 20,000,000.00
Collateral loan 10,000,000.00 7,000,000.00
Total 85,000,000.00 62,400,000.00
1. No short-term loans without payment on due above.
2. More details found in Note about mortgage and collateral for loans at period-end
(XVI) Account payables
Item Balance as at period-end Balance as at period-begin
within 1 year(1 year included) 18,072,795.21 35,876,643.52
1 to 2 years(2 year included) 189,934.07 189,934.07
2 to 3 years(3 year included) 322,696.86 322,696.86
Over 3 years 2,603,129.27 2,603,129.27
Total 21,188,555.41 38,992,403.72
1. No account payable to shareholders units holding over 5% (5% included) voting
shares of the Company was included in the balance as at year-end.
2. No account payable to related parties was included in the balance as at year-end.
3. Account payable in great amount aging over one year:
82
Creditor Amount Reason for unsettlement Remarks
Formed by a long period
Customer I 518,655.52 and no push for receivable Over 3 years
from customer
Formed by a long period
Customer II 515,892.30 and no push for receivable Over 3 years
from customer
4. Balance of account payable at period-end decrease 17,803,848.31 yuan over that of
period-beginning with 45.66 percent down. Mainly because the amount purchasing for raw
materials from Shenbao Huacheng was settled
(XVII) Account received in advance
Item Balance as at period-end Balance as at period-begin
Payment for goods received in
advance 1,531,203.73 2,150,632.12
Total 1,531,203.73 2,150,632.12
1. No account received in advance from shareholders units holding over 5% (5%
included) voting shares of the Company was included in the balance as at year-end.
2. No account received in advance from related parties was included in the balance
as at year-end.
(XVIII) Wages payable
1. Wages payable
Balance as at Increase during Decrease during Balance as at
Item
period-begin this period this period period-end
(1) Wage, bonus, allowance
2,275,290.72 12,551,433.17 14,018,629.35 808,094.54
and subsidy
(2) Employees’ welfare --- 1,475,482.91 1,475,482.91 ---
(3) Social security 46,118.39 2,336,086.34 2，435，984.72 (53,779.99)
(4) Trade union fee and
727,470.16 332,588.09 283,644.31 776,413.94
education fee
(5) Welfare for dismiss 250,000.00 --- 57,387.00 192,613.00
Total 3,298,879.27 16,695,590.51 18,271,128.29 1,723,341.49
2.Balacen of wages payable at period-end mainly was caused by the accrued salaries in current
month that distributed in early of next month; no particular of default wages been found
3. Balance of wages payable at period-end decrease 1,575,537.78 yuan over that of
period-beginning with 47.76 percent down. Mainly for the performance salaries for 2010 have
been paid in this period.
(XIX) Tax payable
Taxation Balance as at period-end Balance as at period-begin
VAT 406,601.60 2,320,200.47
Business tax 196,470.25 185,970.25
83
City construction tax 44,478.09 156,802.09
Enterprise income tax 1,176,432.03 1,762,866.95
Personal income tax 59,276.25 48,549.77
Property tax 36,483.74 47,767.49
Embankment fee 758.89 4,702.54
Education surtax 42,867.67 85,254.53
Other tax 52,396.14 38,996.43
Total 2,015,764.66 4,651,110.52
Balance of tax payable at period-end decrease 2,635,345.86 yuan over that of period beginning
with 56.66 percent down mainly due to the VAT payable at period-begin has been paid in this
period.
(XX) Dividend payable
Balance as at Balance as at Reasons for un-payment over one
Item
period-end period-begin year
Shares without trusted 218,212.60 218,212.60 ---
Shenzhen Investment Original largest shareholder, formed
2,690,970.14 2,690,970.14
Management Co., from left-over of historical guarantee
Total 2,909,182.74 2,909,182.74 ---
(XXI) Other payables
Aging analysis Balance as at period-end Balance as at period-begin
within 1 year(1 year included) 63,800,495.14 62,550,677.33
1 to 2 years(2 year included) 5,581,388.21 5,581,388.21
2 to 3 years(3 year included) 330,091.72 330,091.72
Over 3 years 8,619,803.65 8,619,803.65
Total 78,331,778.72 77,081,960.91
1. Others payable due to shareholders units holding over 5% (5% included) voting
shares of the Company at period-end
Unit Balance as at period-end Balance as at period-begin
Shenzhen Investment Management
3,510,297.20 3,510,297.20
Co.,
2. Others payable due to related parties at period-end
Unit Balance as at period-end Balance as at period-begin
Shenzhen Investment Management
3,510,297.20 3,510,297.20
Co.,
3. Explanation for others payable in great amount aging over one year
Relationship
Nature or Reasons for
Unit with the Amount
content un-payment
Company
Shenzhen Investment Original largest Incomings and 3,510,297.20 Historical
84
Management Co., shareholder outgoings reason
Total 3,510,297.20
4. Others payable in major amount
Relationship with Nature or Remar
Unit Amount Aging
the Company content ks
Construction of
Shenzhen Jitai Industrial Project Within 1
the Shenbao 60,108,931.13
Development Co., Ltd. amount year
Building
Huizhou Shengli Zhiye Business
Business 7,276,167.00 1-2years
Investment Co., Ltd. amount
Hainan Third Construction Project Within 1
Construction 4,401,099.22
Project Co., amount 工 year
Incomings
Shenzhen Investment Original largest Over 3
and 3,510,297.20
Management Co., shareholder years
outgoings
Explanation on other account payable with major amount: the land of 2,776.8 m2
located in Wenjin Rd.(N), Luohu District, Shenzhen(Land serial: H307-0018) was in
project development with Shenzhen Jitai Industrial Development CO., Ltd. The
additional land price of 55,756,182.00 yuan paid last period was the capital provided by
Shenzhen Jitai Industrial Development CO., Ltd., according to the Cooperation
Agreement for Construction Projects signed between the two parties which were listed as
the item of other account payable. More details found in Explanation (II) of Note (IX)
(XXII) Non-current liability due within one year
Borrowing condition Balance as at period-end Balance as at period-begin
Long-term loans due within
57,500,000.00 66,500,000.00
one year
Total 57,500,000.00 66,500,000.00
1. Classification on long-term loans due within one year
Borrowing condition Balance as at period-end Balance as at period-begin
Collateral loan 57,500,000.00 66,500,000.00
Total 57,500,000.00 66,500,000.00
2. Particular about the loans mortgage at period-end found in Note VIII
(XXIII) Other current liability
Balance as at Balance as at
Item Remarks
period-end period-begin
Research project on key technology for process
of the extracts from ARS nature high-essence 43,137.43 43,137.43 *1
green tea
Construction amount for 50 tons for clearly 450,000.00 450,000.00 *2
85
processing for Mingyou tea
Base of processing industrialized for tea and *3
1,500,000.00 ---
natural plant
Total 1,993,137.43 493,137.43
*1: On 31 March 2010, the Shenbao Huacheng- subsidiary of the Company, entered into the Contract
of Shenzhen Technology Plan Project with Shenzhen Science and Industry and Trading Information
Committee (“SZSITIC” for short). SZSITIC provided the fund of RMB 0.5 million for free to the
Company for research project on key technology for process of the extracts from ARS nature
high-essence green tea. Fund was received on 18 May 2010 by the Company. Till end of 31 December
2010, relevant expense occurred in this item amounting to RMB 456,862.57, and carrying forward
RMB 456,862.57 as the non-operating income.
*2: In December 2010, the business government grants amount of RMB 0.45 million for construction
of 50 tons for clearly processing Mingyou tea was received by sub-subsidiary of the
Company—Wuyuan Jufangyong from Comprehensive Development Industrial of Office of
Agricultural Development in Wuyuan County. The amount use for the plant reform of chill rom and
the purchase of production line for Mingyou green tea and equipment
*3: In 2011, Shenbao Huacheng, subsidiary of the Company, received the subsidy for modern
agriculture construction of 3.3 million yuan from Shenzhen Development & Reform Committee
(SFG[2011] No. 468). The subsidy mainly used in the project of industrialization base for processing
on tea and natural plants, 1.5 million yuan was received in this period.
(XXIV) Long-term loan
Borrowing condition Balance as at period-end Balance as at period-begin
Collateral loan 26,000,000.00 27,000,000.00
Total 26,000,000.00 27,000,000.00
1. None of the above loans were past due.
2. Particular about the loans mortgage at period-end found in Note VIII
(XXV) Other non-current liability
Balance as at
Item Balance as at period-end Remarks
period-begin
Subsidy for tea seeding of New Tea
49,920.00 49,920.00
Garden in Wangkou
Total 49,920.00 49,920.00
(XXVI) Share capital
The registered share capital in issue and paid-up share capital of the Company are listed
as follows:
Balance as at period-end Balance as at period-begin
Item
Shares Amount Shares Amount
A share (carrying value of
224,764,154 224,764,154.00 155,787,088 155,787,088.00
RMB 1 per share)
B share (carrying value of
26,136,000 26,136,000.00 26,136,000 26,136,000.00
RMB 1 per share)
Total 250,900,154 250,900,154.00 181,923,088 181,923,088.00
86
Change in share capital of the Company during this period:
Balance as at
Increased (decreased) in this period Balance as at period-end
period-begin
Shares
Bonu
Item converte
New shares s Oth
Amount Portion d from Sub-total Amount Portion
issued share ers
public
s
reserve
I. Shares with selling
restriction condition
(1)State-owned shares --- --- --- --- --- --- --- --- ---
(2)State-owned legal
6,783,729.00 3.73% --- --- --- --- --- 6,783,729.00 2.70%
person shares
(3)Other domestic
7,770,118.00 4.27% 68,977,066.00 --- --- --- 68,977,066.00 76,747,184.00 30.59%
shares
Including:
Domestic legal
7,770,118.00 4.27% 48,241,378.00 --- --- --- 48,241,378.00 56,011,496.00 22.32%
person shares
Domestic natural
--- --- 20,735,688.00 --- --- --- 20,735,688.00 20,735,688.00 8.26%
person shares
(4) Foreign shares --- --- --- --- --- --- --- --- ---
Total of shares with
selling restriction 14,553,847.00 8.00% 68,977,066.00 --- --- --- 68,977,066.00 83,530,913.00 33.29%
condition
II. Tradable shares
without selling
restriction condition
(1) RMB common
141,233,241.00 77.63% --- --- --- --- --- 141,233,241.00 56.29%
shares
(2)Domestic-listed
26,136,000.00 14.37% --- --- --- --- --- 26,136,000.00 10.42%
foreign shares
Total of tradable shares
without selling 167,369,241.00 92.00% --- --- --- --- --- 167,369,241.00 66.71%
restriction condition
100.00
Total 181,923,088.00 68,977,066.00 --- --- --- 68,977,066.00 250,900,154.00 100.00%
%
*On 22 June 2011, the Company placed RMB ordinary share (A-Share) of 68,977,066 shares
privately to specific targets with carrying value of 1.00 yuan each, placing
subscription price of 8.70 yuan per share. The placing totaling raised fund of
600,100,474.20 yuan. (Among which, 4 natural persons purchased the privately offering
shares of the Company by 48.33 percent equity of Shenbao Huacheng held by hand with
consideration of 65,100,481.80 yuan). Being placed this time, total register capital
of the Company turned to 250,900,154.00 yuan. Approved by LXDHYZi [2011] No. 177
document of the Capital Verification Report issued by BOD China Lixin Dahua CPA Co.,
Ltd, all the raised capital of this time of non-public issuing had been paid up on Jun.
23 of 2011, which the Company had deposited them in specific account. registration and
entrust procedure over theses shares had been accomplished in China Securities
Depository and Clearing Co., Ltd. Branch in Shenzhen on Jun. 27 of 2011. On July 1 of
2011, they were registered and on July 4 of 2011 all the newly increased shares were
listed in Shenzhen Stock Exchange.Commerce has been done on 12 July 2011. total register
87
capital of the Company turned to 250,900,154.00.
88
(XXVII) Capital reserves
Balance as at Increase during Decrease during Balance as at
Item
period-begin this period this period period-end
Share capital
78,583,100.73 503,415,075.89 14,587,923.67 567,410,252.95
premium
Other capital reserve 1,289,969.56 --- --- 1,289,969.56
Total 79,873,070.29 503,415,075.89 14,587,923.67 568,700,222.51
*Notes to capital reserve:
1. Share premium increase 503,415,075.89 yuan in this period for privately stock offering;
2. Capital reserve-share premium decrease 14,587,923.67 yuan in this period due to the influenced of
48.33 percent minority’s equity of Shenbao Huacheng, controlling subsidiary of the Company, was
acquired by the Company.
(XXVIII) Surplus reserves
Balance as at Increase during Decrease during Balance as at
Item
period-begin this period this period period-end
Statutory surplus
32,464,033.34 --- --- 32,464,033.34
reserves
Total 32,464,033.34 --- --- 32,464,033.34
(XXIX) Retained profit
Item Amount
Balance as at end of period year 30,831,869.17
Add: adjustment to amount as at period-begin ---
Balance as at period-begin of this period 30,831,869.17
Add: net profit attributable to parent company for this
4,396,354.98
period
Less: provision of statutory surplus reserve ---
provision of discretionary surplus reserve ---
Dividend payable for ordinary shares ---
Dividend of ordinary shares converted to share capital ---
Add: other transfer-in ---
Add: losses made up by surplus reserve ---
Balance as at period-end of this period 35,228,224.15
(XXX) Operating income and costs
89
Amount as at this period Amount as at previous period
Item
Operating income Operating cost Operating income Operating cost
Main business
139,919,514.99 111,997,121.49 98,031,142.11 75,021,441.08
income
Other business
3,476.07 211,975.66 --- 84,995.97
income
Total 139,922,991.06 112,209,097.15 98,031,142.11 75,106,437.05
1. Main business income and main business cost classified according to industry
Amount as at this period Amount as at previous period
Industry Main business Main business Main business Main business
income cost income cost
Industry 139,919,514.99 111,997,121.49 98,031,142.11 75,021,441.08
Total 139,919,514.99 111,997,121.49 98,031,142.11 75,021,441.08
2. Main business income and main business cost classified according to products
Amount as at this period Amount as at previous period
Products Main business Main business Main business Main business
income cost income cost
Soft beverage 11,808,162.02 10,225,257.66 13,667,904.30 9,691,178.74
Seasoning 6,305,580.74 4,137,187.26 8,107,447.50 5,338,677.44
Tea products 121,512,372.23 97,634,676.57 75,947,990.31 59,991,584.90
Lease service 293,400.00 --- 307,800.00 ---
Total 139,919,514.99 111,997,121.49 98,031,142.11 75,021,441.08
3. Main business income and main business cost classified according to areas
Amount as at this period Amount as at previous period
Classification of Main business Main business Main business Main business
main business income cost income cost
Export 432,985.23 247,480.34 2,795,908.37 2,205,942.26
Subtotal of overseas 432,985.23 247,480.34 2,795,908.37 2,205,942.26
South of China 37,039,819.46 29,123,437.81 31,145,354.86 21,404,733.84
North of China 15,667,889.12 13,167,130.92 5,060,539.44 3,549,388.65
East of China 52,199,066.56 38,617,349.50 39,805,869.61 31,832,091.46
Other regions 34,579,754.62 30,841,722.92 19,223,469.83 16,029,284.87
Subtotal of domestic 139,486,529.76 111,749,641.15 95,235,233.74 72,815,498.82
Total 139,919,514.99 111,997,121.49 98,031,142.11 75,021,441.08
4. Main business income from the top 5 customers
Total of main business Portion taken in all main business
Customers
income income of the Company (%)
90
Customer II 65,966,154.51 47.15
Customer I 30,068,452.10 21.49
Customer III 9,386,443.42 6.71
Customer IV 7,384,324.85 5.28
Customer V 6,961,374.48 4.98
Total 119,766,749.36 85.60
(XXXI) Operating tax and surcharges
Amount as at this Amount as at
Item Standard for taxation
period previous period
一 Income from normal labor
Business tax service, transportation and other 177,670.00 138,390.00
income * 5%
City maintenance Business tax and VAT paid * 1%,
426,826.49 136,794.91
and construction tax 5% or 7%
Education surtax Business tax and VAT paid * 3% 266,138.04 134,551.74
Other 26,210.98 22,038.22
Total 896,845.51 431,774.87
(XXXII) Sales expense
Item Amount as at this period Amount as at previous period
Wages and expenses for
employees 1,921,376.42 1,240,839.26
Leasing and utilities 223,152.07 55,500.00
Depreciation and amortization
charge 186,492.13 80,453.24
Charge of commodity transport 3,163,671.31 2,137,551.84
Sales discount and promotion
charge 2,006,818.11 1,809,427.44
Daily office charge 1,163,280.38 772,268.48
Other 304,510.56 214,389.15
Total 8,969,300.98 6,310,429.41
(XXXIII) Administrative expense
Item Amount as at this period Amount as at previous period
Wages and expenses for
employees 7,367,934.78 6,262,396.68
Leasing and utilities 852,764.66 1,019,729.87
91
Depreciation and amortization
charge 4,467,167.15 3,272,314.04
Agency and disclosure charge 1,542,040.00 927,440.80
Taxes 324,320.96 298,230.89
Daily office charge 4,862,929.27 4,421,761.22
manufacture suspension charge 464,902.68 2,453,538.50
Other 1,817,461.90 1,036,034.28
Total 21,699,521.40 19,691,446.28
(XXXIV) Financial expense
Item Amount as at this period Amount as at previous period
Interest expense 5,048,296.01 5,093,421.78
Less: interests income 590,837.15 597,361.52
Exchange loss 22,248.88 1,174.51
Less: Exchange gain --- ---
Other 70,943.03 46,680.07
Total 4,550,650.77 4,543,914.84
(XXXV) Asset impairment loss
Item Amount as at this period Amount as at previous period
Bad debt loss (70,079.95) ---
Inventory impairment loss --- (4,650.98)
Total (70,079.95) (4,650.98)
(XXXVI) Gains from change of fair value
Source of gains from change
Amount as at this period Amount as at previous period
of fair value
Transaction financial assets （42,000.00） 139,500.00
Total （42,000.00） 139,500.00
(XXXVII) Investment gains
1. Details of investment gains
Amount as at this Amount as at
Projects or invested units
period previous period
(1) Long-term equity investment gains recognized
--- ---
under cost method
(2) Long-term equity investment gains recognized
（269,528.67） (12,550,001.25)
under equity method (applicable for 2 units)
(3) Investment income from disposal of long-term
4,279.44 497,932.95
equity investment (applicable for 1 unit)
92
Total （265，249.23） ( 12,052,068.30)
2. Long-term equity investment gains calculated under equity method
Amount as at this Amount as at
Invested unit Reason for change
period previous period
Soaring of
Shenzhen PEPSI (269,528.67) (11,524,303.61)
economic benefits
Changzhou Sanjing Oil Co.,
--- (1,025,697.64)
Ltd.
Total (269,528.67) (12,550,001.25)
3. Explanation on investment gains
No material restriction will appear in recovery of investment income of the Company.
(XXXVIII) Non-operating income
Amount as at previous
Item Amount as at this period
period
Gains from disposal of non-current assets 34,564.65 611,353.87
Including: Gains from disposal of
34,564.65 611,353.87
fixed assets
Gains from disposal of
--- ---
construction in process
Gains from disposal of
--- ---
intangible assets
Government grant 310,048.00 *1 984,736.75
Income from government subsidy --- 1,216,901.37
Others 17,088,944.71 *2 1,050.00
Total 17,433,557.36 2,814,041.99
*1: Details of government grant
Amount as at this Amount as at previous Remark
item
period period s
Integration capital for tea
200,000.00 --- (1)
industry( discount loans for projects)
Project of ecological demonstration tea
--- 700,000.00
park of sustainable development
Grants for research project on key
technology for process of the extracts --- 189,596.75
from ARS nature high-essence green tea
Government grants for other projects 110,048.00 95,140.00
Total 310,048.00 984,736.75
(1)Sub-subsidiary of the Company—Wuyuan Jufangyong received the capital for tea
industry integration (financial discount loans) of 200,000.00 yuan from Financial Bureau
93
of Wuyuan County till end of 30 June 2011. Non-operating income was recognized as
200,000.00 yuan in this period.
*2: Guangdong Shengrun Group Holding Co., Ltd. (“Shengrun Company”) was judged
for reorganization by Intermediate People’s Court of Shenzhen in April 2010. The
Company applied for credit to manager of Shengrun Company, being rectified the credit
amount confirmed as 62,150,928.20 yuan. On 22 October 2010, the “Reorganization Plan
of Guangdong Shengrun Group Holding Co., Ltd.” was approved by ruling from
Intermediate People’s Court of Shenzhen, ordinary creditor’s discharge ratio for this
reorganization plan was: 2.16 percent for monetary discharge while 27.89 percent for
share discharge, totaling 30.05 percent discharge rate for ordinary creditors. According to
the first allocation plan for reorganization from manager of Shengrun Company on 11
January 2011, the Company received the first discharge amount of 1,381,832.66 yuan on
23 January 2011. On 1 April 2011, totaled 2,135,071 A share (including 237,665 shares
of unrestricted conditions with price of 9.07 yuan per share and 1,897,406 shares of
restricted conditions with 8.00 yuan per shares) of ST Shengrun. After deducting relevant
expenses 1,628,169.00 yuan, non-operating income for the Company was recognized as
17,088,533.21 yuan in this period.
(XXXIX) Non-operating expenses
Item Amount as at this period Amount as at previous period
Losses from disposal of non-current
60,551.66 15,698.07
assets
Including: Losses from disposal
60,551.66 15,698.07
of fixed assets
External donation expenditure --- ---
Including: Welfare donation --- ---
Others --- 5,867.00
Total 60,551.66 21,565.07
(XL) Income tax expense
Item Amount as at this period Amount as at previous period
Current income tax calculated by tax
1,674,051.00 53,230.14
law and relevant regulations
Adjustment on deferred income tax --- ---
Total 1,674,051.00 53,230.14
(XLI) Computer of basic earnings per share and diluted earnings per share
Calculation of basic earnings per share:
Basic earnings per share =P0÷S
S= S0＋S1＋Si×Mi÷M0–Sj×Mj÷M0-Sk
Among which: PO represents net profit attributable to shareholders of ordinary shares of
the Company or net profit (net of non-current gains and losses) attributable to
shareholders of ordinary shares of the Company; S represents the weighted average
number of ordinary shares in issue; SO represents aggregate of shares as at period-begin;
S1 represents share added due to conversion of public reserve to share capital or
allocation of share dividends during the report period; Si represents share added due to
94
new issuance of shares or shares converted from debts during the report period; Sj
represents shares decreased due to purchase-back of its own shares during the period; Sk
represents shares diluted during the period; MO represents number of months for the
period; Mi represents the accumulated months commencing from the month subsequent
upon shares addition to year-end of the period; Mj represents the accumulated months
commencing from the month subsequent upon shares deduction to year-end of the period.
Calculation of diluted earnings per share:
Diluted earnings per share= P1/(S0＋S1＋Si*Mi/M0–Sj*Mj/M0–Sk+weighted average
number of ordinary shares increased from (warrant+option+convertible bonds)
Among which: P1 represents net profit attributable to shareholders of ordinary shares of
the Company or net profit (net of non-current gains and losses) attributable to
shareholders of ordinary shares of the Company, and is subject to adjustment under
relevant regulations of Accounting Standard for Enterprises in light of the affect of
diluted potential ordinary shares. When computering diluted earnings per share, the
Company shall take into account the affects conducted by all diluted potential ordinary
shares upon net profit attributable to shareholders of ordinary shares of the Company or
net profit (net of non-current gains and losses) attributable to shareholders of ordinary
shares of the Company and weighted average shares. According to dilution degree (in
order from big to small), dilution shall be accounted in diluted earnings per share until
which arrives at its minimized amount.
1. Net profit attributable to shareholders of ordinary shares of the Company:
Basic EPS =4,396,354.98/（181,923,088.00+68,977,066*0）=0.0242
Diluted EPS =4,396,354.98/（181,923,088.00+68,977,066*0）=0.0242
2. Net profit (net of non-current gains and losses) attributable to shareholders of
ordinary shares of the Company:
Basic EPS =-12,866,651.90/（181,923,088.00+68,977,066*0）=-0.0707
Diluted EPS =-12,866,651.90/（181,923,088.00+68,977,066*0）=-0.0707
(XLII) Notes to statement of cash flow
1. Other cash received in relation to operation activities
Amount as at previous
Item Amount as at this period
period
Land payment of Oumingda Company 1,052,278.00 ---
Credit amount classified by manager of credit
1,381,832.66 ---
under Shengrun Company
Government grants received 1,810,048.00 1,645,140.00
Rental --- 307,800.00
Compensation for the plant relocation of
project of road breakthrough, Tianbei 2nd Rd.,
--- 5,278,067.00
Reform Office of Aged Urban and Aged
Village, Luohu District, Shenzhen
Current amount of Shenzhen Jitai Industrial
968,819.67 ---
Development Co., Ltd.
Other 1,232,906.44 2,645,979.68
Total 6,445,884.77 9,876,986.68
95
2. Other cash paid in relation to operation activities
Amount as at previous
Item Amount as at this period
period
Aggregate of incomings and outgoings of
1,803,391.35 1,570,156.85
external units with small amount
Attorney fees of Deheng Affairs 1,628,169.00 ---
Current account of Shenbao Real Estate
1,699,670.00 ---
Development Co.,
Consulting fee of Beijing H&J Consulting
576,000.00 ---
Co.,
Current account of Changzhou Sanjing Oil
--- 3,400.000.00
Co., Ltd.
Management and sales fees of the Company 14,086,691.39 13,311,597.74
Rent 806,563.98 491,400.00
Other 2,324,170.15 3,040,096.50
total 22,924,655.87 21,813,251.09
(XLIII) Supplementary information to statement of cash flow
1. Supplementary information to statement of cash flow
Amount as at this Amount as at
Item
period previous period
I.Net profit adjusted to cash flow of operation
activities
Net profit 7,059,360.57 (17,221,530.88)
Add: assets impairment losses (70,079.95) (4,650.98)
Depreciation of fixed assets, consumption of oil
assets and depreciation of productive biology 5,028,087.18
assets 4,512,793.11
Amortization of intangible assets 2,738,022.32 1,941,928.44
Amortization of long-term deferred expenses 390,285.88 171,312.14
Loss from disposal of fixed assets, intangible assets
25,575.51
and other long-term assets(gain is listed with “-”) (1,819,205.22)
Loss of disposing fixed assets(gain is listed with
---
“-”) ---
Loss from change of fair value(gain is listed with
42,000.00
“-”) (139,500.00)
Financial expenses (gain is listed with “-”) 5,530,183.59 4,543,914.84
Investment loss (gain is listed with “-”) 265,249.23 12,052,068.30
Decrease of deferred income tax asset( (increase is
listed with “-”) ---
Increase of deferred income tax liability (decrease
---
is listed with “-”) ---
Decrease of inventory (increase is listed with “-”) (3,328,118.84) (15,665,283.92)
96
Decrease of operating receivable accounts (increase
(15,667,173.88)
is listed with “-”) (18,906,825.47)
Increase of operating payable accounts (decrease is
(10,285,802.34)
listed with “-”) 24,402,861.29
Others --- ---
Net cash flow arising from operating activities (8,272,410.63) (6,132,118.35)
II. Material investment and financing not involved
in cash flow
Liabilities converted to capital --- ---
Convertible bond expire in 1 year --- ---
Fixed assets leased through financing --- ---
III.Net change of cash and cash equivalents
ce of cash at period end 587,792,262.16 57,336,722.08
Less: Initial balance of cash 40,540,179.32 90,613,421.70
Plus: Balance of cash equivalents at the period end --- ---
Less: Initial balance of cash equivalents --- ---
Net increasing of cash and cash equivalents 547,252,082.84 (33,276,699.62)
2. Constitution of cash and cash equivalent:
Item Balance as at period-end Balance as at period-begin
I. Cash 587,792,262.16 40,540,179.32
Including: stock cash 380,766.05 190,951.97
Bank deposit available for
587,411,496.11 40,349,227.35
payment at any time
Other monetary fund available
--- ---
for payment at any time
II. Cash equivalent --- ---
Including: bond investment matured
--- ---
within 3 months
III. Balance of cash and cash equivalent at
587,792,262.16 40,540,179.32
year-end
VI. Related Parties and Transactions
(I) Related Parties
1. Relationship
(1)Parent company of the Company
Relat Legal Proport Proportio
Parent Registratio Registere Organizat
ionsh Nature represe Business nature ion of n of
company n place d capital ion code
ip ntative shares voting
97
held to right to
the the
Compa Company
ny
Development,
Contr 22 floor, construction,
Shenzhen
ollin Tianle operation and RMB
Agricultu Stock Chen
g Building, management of 768,507,9 19217916
ral limited Shaoqu 19.09% 19.09%
share No.1021 agricultural products 00 3
Products (listing) n
holde Buji Road, retail market,
Co., Ltd.
r Shenzhen operation of market
leasing
(2) Basic information of the parent company
Related parties Relationship with the Company
Shenzhen Agricultural Products Co., Ltd. Controlling shareholder of the Company
State-owned Assets Supervision & Administration
Commission of Shenzhen Municipal (“SZ State-owned Actual controller of the Company
Assets”)
2. Subsidiary of the Company
Shares held Proportio
Legal
n of
Register Busines repre Register
Full name Type Nature Indir voting
place s nature senta capital Directly
ectly rights
tive
held
Shenzhen Shenbao Controlli
103.4513
Huacheng ng Limited Manufa Zhen
Shenzhen million 100% --- 100%
Technology Co., subsidiar liability cture Yuxi
yuan
Ltd. y
Shenzhen Shenbao
Limited
Sanjing Food Yao 30.15
Wholly-o liability Manufa
Beverage Shenzhen Xiao million 100% --- 100%
wned (corporate cture
Development Co., peng yuan
–owned)
Ltd .
Huizhou Shenbao Yao
Wholly-o Limited Huizhou, Compre 4 million
Technology Co., Xiao 100% --- 100%
wned liability GD hensive yuan
Ltd. peng
Shenzhen Shenbao Propert
Property Wholly-o Limited y Peng 5 million
Shenzhen 51% 49% 100%
Management Co., wned liability Manage Ying yuan
Ltd. ment
Shenzhen Shenbao Wholes
Industry & Trading ale of Guan
Wholly-o Limited 5.5 million
Co., Ltd. Shenzhen commer Lihu 100% --- 100%
wned liability yuan
cial and a
trade
Informa
Huizhou Shenbao Yao
Wholly-o Limited Huizhou, tion 5 million
Industrial Xiao 100% --- 100%
wned liability GD consulta yuan
Investment Co., Ltd. peng
nt
Shenzhen Shenbao Sharehol --- Shenzhen --- --- 237.80 53.5% --- 53.5%
98
(Liaoyuan) ding million
Industrial Co., yuan
(“Shenbao
Liaoyuan”)
3. Information related to joint ventures and associates of the Company are provided
in Note V(VII).1.
4. Particulars about other related parties
Other related parties Relation with the Company Organization code
Original largest shareholder of the
Shenzhen Investment Management Co., 767566421
Company
Zheng Yuxi, Peng Ying, Yan Zesong, Li Fang, Key administrators of the
---
Zeng Suyan, Li Yiyan, Lin Hong, etc. Company
(II)Related transaction
1. As for subsidiaries where controlling exists and which have been consolidated to
consolidation scope of the Company, transactions among them and transactions
occurred between parent company and subsidiaries have been all offset.
2. Related guarantee
Guarantee Whether being
Relation with the Start date of Due date of
Guarantor amount(RMB’000 implemented
Company guarantee guarantee
0) completely or not
Shenbao Controlling
2,000 2010-10-21 2011-10-21 Not
Huacheng *1 subsidiary
Shenbao Controlling
1,000 2011-01-26 2011-12-26 Not
Huacheng *2 subsidiary
Shenbao Controlling
532.37 2011-01-26 2011-12-26 Not
Huacheng *2 subsidiary
Shenbao Controlling
1,500 2011-05-26 2011-5-26 Not
Huacheng *3 subsidiary
*1 The Loan Contract for Current Capital Due within One Year was signed between the Shenbao
Huacheng, subsidiary of the Company, and Shenzhen Shennan Branch of China Everbright Bank on
21 October 2010 with RMB 20 million obtained as borrowing. Jointly liability was provided by the
Company for the above guarantee.
*2 Shenbao Huacheng, controlling subsidiary of the Company, entered into the Current Capital
Contract due within one year with Ping’ an Bank Co., Ltd. on 26 January 2011 with limit of 20
million yuan. Among which: Renminbi borrowing of 10 million yuan, credit ceiling of 10 million
yuan, balance at period-end of 10 million yuan in borrowing, balance of credit amounting to 5.3237
million yuan. The above said borrowing was provided with jointly liability by the Company.
*3 Shenbao Huacheng, controlling subsidiary of the Company, entered into the Current Capital
Contract due within one year with CGB on 26 May 2010 with limit of 30 million yuan. Totaled 15
million yuan was obtained as borrowed at period-end that with the jointly liability offered by the
Company.
3. Account receivable/payable for related parties
(1) Account receivable from related parties
99
Balance at period-end Balance at period-begin
Item Name of related party Contents Book Bad debt Book Bad debt
balance provision balance provision
Account of
Account Shenzhen Agricultural
goods --- --- 4,868.00 ---
receivable Products Co., Ltd.
receivable
Other Incomings
Changzhou Sanjing Oil
account and outgoings 15,060,609.65 1,147,877.21 14,667,540.28 1,147,877.21
Co., Ltd.
receivable and interest
Total 15,060,609.65 1,147,877.21 14,672,408.28 1,147,877.21
(2) Account payable to related parties
Balance at
Item Name of related party Contents Balance at period-end
period-begin
Other account Shenzhen Investment Incomings and
3,510,297.20 3,510,297.20
payable Management Co., Ltd. outgoings
Other account Shenzhen Shenbao Property
--- --- 1,699,670.00
payable Development Co., Ltd.
Dividend Shenzhen Investment Dividend for
2,690,970.14 2,690,970.14
payable Management Co., Ltd. previously years
Total 6,201,267.34 7,900,937.34
VII.Contingent events
Contingent events formed from outstanding lawsuits or arbitrations and influence
upon finance
(I) Lawsuits connected with Guangdong Shengrun Holding Co., Ltd.
1. “Guarantee Contract” was entered into by the Company and Futian Sub-branch of
Shenzhen ICBC on 30 December 1998 for jointly liability of HK$3 million loans to
Shengrun Company from the Company.
2. “Guarantee Contract for Loans” was entered into by the Company and Nantou
Sub-branch of SDB on 30 June 1999 for jointly liability of HK$6 million loans to
Shengrun Company from the Company.
3. “Borrowing Contract” was entered into by the Shengrun Company and Nantou
Shenzhen branch of BOC on 31 December 1998 for HK$32 million borrowings; the
Company provided jointly liability for the aforesaid loans.
4. “Guarantee Contract” was entered into by the Company and NanyuanSub-branch of
GDB on 23 June 1999 for jointly liability of 8 million yuan loans to Shengrun Company
from the Company.
The abovementioned events was part of the historic events that remains before 1999
under the circumstances of being controlling subsidiary of Shenzhen Investment
Management Co., Ltd, namely the Company and Shengrun Company. As at end of 2007,
the possibility losses occurred from the above mentioned guarantees was predicted by the
Company for withdrawal and the withdrawal has done.
Amounts paid for jointly liabilities abovementioned, was discharged by the first payment
that received from manager of Shengrun within the period. More detaisl found in *2 of
(XXXVIII) of Note V.
(II) Jointly liability for the guarantee offered to Shenzhen China Bicycle Company
(Holdings) Limited
The case concerning the joint-liability guarantee the Company provided for the RMB 7
100
million loans which Shenzhen China Bicycle Company (Holdings) Limited
(“ShenChina” for short) had obtained from Shenzhen Branch of China Construction
Bank (“Construction Bank” for short) has been closed with reconciliation. The
Agreement of Interest Reduction was signed between the Company and Construction
Bank in 2003, the RMB 7 million have been paid by the Company for ShenChina in two
phases and accomplished the jointly liability; Concerning the jointly-liability of the
Company for Letter of Credit Opening for ShenChina in Shenzhen Branch of Bank of
China with USD 0.8 million, being verdict by Civil Ruling of (1999) YFJYZZ No. 26
from Guangdong Higher People’s Court, the Company takes the jointly-liability for
payment. Till end of 30 June 2004, the RMB 6.6316 million (USD 0.8 million by
converted) have been paid by the Company for ShenChina and accomplished the jointly
liability; later on 22 July 2004, the Company applied to Shenzhen Intermediate People’s
Court for the enforcement on the above repayment.
In 2004, the Company brought a charge against ShenChina to Shenzhen Intermediate
People’s Court for compensated relevant losses on capital occupation and with RMB 7
million paid for pre-payment by the Company. Shenzhen Intermediate People’s Court
verdict that the RMB 7 million repaid by the Company for ShenChina should be paid to
the Company together with interest during capital occupation, (2004) SZFMECZ No.
448. Due to the failure implementation for the verdict on time and certain content from
ShenChina, the Company applied for enforcement to Shenzhen Intermediate People’s
Court on 20 December 2004. The Civil Ruling and Execution Order of (2004) SZFZZ No.
1382 and (2005) SZFZZ No. 208 were delivered to ShenChina on 14 January 2005 from
Shenzhen Intermediate People’s Court with verdict that: seal up and freeze the property
of ShenChina (limited as RMB 14,131,575.92) and order ShenChina performed the
effective-ness law documents and relevant obligations within five days since the
execution order received. Un-performed undue, the enforcement will exercise by
Shenzhen Intermediate People’s Court. Later, the abovementioned two executions was
appointed by the Court of Guangzhou Railway Transportation by Guangdong Hiher
People’s Court, and the case abortion due to no property clue been found. Execution
should be applied to Court of Guangzhou Railway Transportation for recover due to the
situation of abortion disappeared.
VIII.Assets with restricted ownership
Assets with restricted Original carrying Balance as at
Area (m2) Net carrying value
ownership value period-end
1.No.1-2 plants of Shenzhen
10,394.01 30,129,419.75 25,086,337.67 26,000,000.00
Henggang Huacheng
2.Aged plant of Jiangxi
--- 1,026,350.23 881,993.82
Wuyuan Jufangyong
2.Land in Dazhangshan
4,176.00 4,413,454.06 4,300,865.88 20,000,000.00
road,Ziyang Town, Wuyuan
2.Ruhu Town, Huizhou City 44,995.00 28,745,061.54 27,748,242.86
2.Ruhu Town, Huizhou City 5,157.00 3,294,550.11 3,180,302.00
3.Ruhu Town, Huizhou City 14,073.00 6,912,605.17 6,455,078.13 37,500,000.00
3.Ruhu Town, Huizhou City 15,856.00 10,129,607.64 9,662,022.28
3.Ruhu Town, Huizhou City 11,282.90 5,542,118.45 5,175,300.35
3.Ruhu Town, Huizhou City 7,856.00 3,858,837.93 3,603,431.82
3.Ruhu Town, Huizhou City 17,860.00 8,772,765.47 8,192,119.18
101
3.Ruhu Town, Huizhou City 32,882.00 18,951,515.90 17,661,686.57
3.Ruhu Town, Huizhou City 50,038.00 31,966,782.74 30,195,442.00
4.Land in Industry
115,605.00 8,459,701.00 7,863,486.14
Park,Ziyang Town, Wuyuan
4. Office building in Industry
2,012.30 3,256,622.03 3,127,714.03
Park,Ziyang Town, Wuyuan 10,000,000.00
4. Warehouse of raw
materials in Industrial Park, 4,425.00 2,892,590.07 2,761,734.86
Ziyang Town, Wuyuan
5.51.67% equities of
--- --- --- 20,000,000.00
Shenbao Huacheng
Total 168,351,982.09 155,895,757.59 113,500,000.00
1. On 31 May 2009, the Company entered into current capital loan contract with
Shenzhen Branch of Shanghai Pudong Development Bank, with term being 3 years and
amount being RMB 30 million, under which, it was agreed to repay principal of RMB
500,000 every 3 months and the remaining was going to be one-off repaid upon
expiration. The Company took Huacheng 1# and 2# plants (Certificate No.: 6000168852
and No.:6000168853) located in He’ao villige, Henggang town, Longgang district,
Shenzhen as pledge. As at period end, balance of loan was RMB 26 million.
2. On 29 December 2009, the Company entered into current capital loan contract with
Shenzhen Dongmen Branch of Communications Bank, with term being 2 years and
amount being RMB 20 million, under which, it was agreed to settle the loan by one-off
payment upon expiration. The Company took WGY(2009) No.1382 land and
constructions（WFCZZYZZ No. 9911751, No.9911752, No.9911753, NO. 9911754, No.
9911755 and No. 9911756）and land use right of HFGY (2009) No. 13021120005 and No.
13021120004 lands owned by Huizhou Technologies, the wholly-owned subsidiary of
the Company, as pledges. As at period end, balance of loan was RMB 20 million. The
loans have been expired on 27 December 2011, and re-classified as non-current liabilities
due within one year.
3. The Contract of Unified Credit Line was signed between the Company and Business
Dept. of Shenzhen Ping An Bank on 3 March 2010 with RMB 60 million loans contract.
The loans were 22 days and 17 months limited and RMB 1.5 million should be paid
evenly every month since 20 April 2010 by agreement. The remaining amount RMB 36
million was paid on 25 August 2011 due by one time in total. The land use right of
HFGY(2007) No. 13021120006, No. 13021120007, No. 13021120008, No. 1302112009,
No. 1302112010 and(2008)No.13021120002 and No.13021120009 owned by Huizhou
Shenbao Technology, amounting to 149,847.90 m2 , wholly-owned subsidiary of the
Company, were mortgaged by the Company. The balance at period-end for loans was
RMB 37.5 million.
4. On 11 May 2011, sub-subsidiary of the Company Wuyuan Jufangyong entered into a
current loan contract due within one year with Agricultural Development Bank of
Wuyuan County with comprehensive credit of 10 million yuan. Totaled 5 million yuan
was borrowed on 11 May 2011 and 5 million yuan borrowed on 10 June 2011, the
borrowings will pay on one time while the contract on due. The land use right of
WZZNo.9911447 and AZZ No.9911445 and WGY(2009)No.529 located in industrial
park, Jinjiting, Ziyang Town, Wuyuan Country owned by Wuyuan Jufangyuan of area
respectively as 2012.30 ㎡, 4424.83 ㎡ and 115,605 ㎡ were mortgaged for loans.
Balance of the borrowing at period-end was 10 million yuan.
102
5. The Contract of Current Capital Loans due within One Year was signed between the
subsidiary, Shenbao Huacheng and Shenzhen Shennan Branch of China Everbright Bank
on 21 October 2010 with RMB 20 million loans in contract. The 51.67 percent equity of
the Shenbao Huacheng held by the Company was pledged and the Company took the
jointly-liability for the guarantee.
IX. Significant events
(I) privately offering
Being approved by CSSRC on “Verified on Privately Offering of Shenzhen Shenbao
Industrial Co., Ltd.” (CSSRC Permit[2010] No.777), in report period, the Company
privately offered RMB ordinary share of 68,977,066 shares to 8 specific targets of Ms.
Lin Yixiang, Mr. Xia Zhenzhong, Ms. Cao Lijun, Ms. Zhen Lingna, Ms. Li Duruo,
Shengzhen Zhongtian Investment Co., Ltd., Xinjiang Xiehe Equity Investment Partner
Enterprise (Limited Partnership) and Yingfu (Tianjin) Equity Investment Management
Partner Enterprise (Limited Partnership). The “Verification Report” LXDHYZi[2011]
No.177 was issued by BDO China Li Xin Da Hua CPA Co., Ltd. on 23 June 2011. As at
end of 23 June 2011, totaled monetary fund of 600,100,474.20 yuan was raised by
Shenzhen Shenbao, raised fund actually amounting to 572,392,141.89 yuan after
deducting related expenses with issuance 27,708,332.31 yuan. Among which
68,977,066.00 yuan was reckoned into “Share Capital” while 503,415,075.89 yuan
reckoned into “Capital Reserve- Equity premium”. The fund being raised was planned to
the followed projects:
Total investment Capital plans to
Serial Item
(RMB’0000) invested(RMB’0000)
I Relevant project of tea industry 59,010.05 56,010.05
48.33 percent equity of Shenbao
1 6,510.05 6,510.05
Huacheng acquisition
Comprehensive project of tea industry
2 27,000.00 27,000.00
chain
Comprehensive use project of catechin
3 15,500.00 15,500.00
with 3,000 tons annual produced
4 Chain of the superior tea 6,000.00 3,000.00
5 R&D center for tea and natural plant 4,000.00 4,000.00
Expansion project on production line
II 6,900.00 1,229.17
for condiment
Total 65,910.05 57,239.22
(II) Events of Shenbao Building
According to “Cooperation Agreement for Construction Project” singed between the
Company and Shenzhen Jitai Industrial Development Co., Ltd. (Jitai Industrial for
short) .The land of (ZDNo. H307-0018) located in Wenjin Rd.(N), Luohu District,
Shenzhen was reused by the Company and Jitai Industrial for construction self-used
office building. In addition, no other means of investment should paid by the Company
and bear no any cost for the construction. Jitai Industrial bears the investment and whole
capital arising from construction. Based on the land assess value of H307-0018, RMB 42
million was determined as the property allocation portion for the construction projects.
Ratio of property allocation for the Company was: the proportion of RMB 42 million,
that determined by the land assess value for H307-0018, in total cost of construction
project (that is RMB 42 million + audited all capital investment for construction project
103
by Jitai Industrial); if the proportion lower than 20 percent, than the Company shares
minimum property allocation of 20%.
X. Subsequent events of balance sheet
According to the “Proposal of Agreed Guangdong Shenbao Food Co., Ltd. Mergered by
Huizhou Shenbao Technology Co., Ltd.”, SBD[2010] No.19, and with the purpose of
integrated resources in processing logistic zone of Huizhou Shenbao, satisfied
development requirement for business and implemented the development strategy of the
Company, the 7th Session of the Board consented Huizhou Shenbao Technology Co., Ltd,
subordinated wholly-owned subsidiary, to takeover Guangdong Shenbao Food Co., Ltd,
subordinated wholly-owned enterprise of the Company, as the non-listing body of
Huizhou Shenbao Technology Co., Ltd., relevant events have been handling.
XI. Notes to main items in financial statements of parent company
(I)Account receivable
1. Account receivable disclosed by categories
Balance as at period-end Balance as at period-begin
proport
proportion
ion of
categories Portion Portio of bad
Carrying Bad debt bad Carrying Bad debt
in total n in debt
value provision debt value provision
% total % provision
provisi
%
on %
I. Account
receivable with
single major
amount and --- --- --- --- --- --- --- ---
withdrawal bad
debt provision for
single item
II. Account
receivable
withdrawal bad 13,451.24 32.10 --- --- 26,834.82 48.54 --- ---
debt provision by
age combination
III. Account
receivable with
single minor
amount but 28,453.08 67.90 28,453.08 100.00 28,453.08 51.46 28,453.08 100.00
withdrawal bad
debt provision for
single item
Total 41,904.32 100.00 28,453.08 67.90 55,287.90 100.00 28,453.08 51.46
Explanation for categories of account receivable:
In combination, account receivable withdrawal bad debt provision by age
combination
104
Balance as at period-end Balance as at period-begin
Portion Portion
age Portion of bad Portion of bad
Carrying Bad debt Carrying Bad debt
in total debt in total debt
value provision value provision
% provisi % provisi
on % on %
Within 1 year (1
13,451.24 100.00 --- --- 26,834.82 100.00 --- ---
year included)
1-2years (2years
--- --- --- --- --- --- --- ---
included)
2-3years( 3 years
--- --- --- --- --- --- --- ---
included)
over 3 years --- --- --- --- --- --- --- ---
Total 13,451.24 100.00 --- --- 26,834.82 100.00 --- ---
2．Account receivable with major single amount or minor amount but conducting
impairment testing independently at period-end
bad debt Withdrawal
Item of account
Carrying value provision proportion reasons
receivable
amount (%)
Instrument factory
9,996.58 9,996.58 100.00 Hard to recover
of Potou Hubei
Guo Wenhui 18,456.50 18,456.50 100.00 Hard to recover
Total 28,453.08 28,453.08 100.00
3. Changes of the bad debt provision for account receivable
Carrying amount amount decreased in this period Carrying
item balance at withdrawal in this balance at
period-begin period Turn-back Turn-off period-end
2011(this period) 28,453.08 --- --- --- 28,453.08
4. No arrear made by shareholders units holding over 5% (5% included) voting
rights of the Company appeared in the account receivables as at period-end.
(II)Other receivables
1. Other account receivable classified according to categories
Balance as at period-end Balance as at period-begin
Portion Portion
Type of clients Portion of bad Portion of bad
Carrying Bad debt Carrying Bad debt
in total debt in total debt
value provision value provision
% provision % provision
% %
I. Other
account --- --- --- --- --- --- --- ---
receivable with
105
single major
amount and
withdrawal bad
debt provision
for single item
II. Other
account
receivable
266,261,728. 1,307,309.3 294,952,945 1,307,309.3
withdrawal bad 97.99 0.49 98.18 0.44
90 6 .01 6
debt provision
by age
combination
III. Other
account
receivable with
single minor 5,472,398.9 5,472,398.9 5,472,398.9
5,472,398.91 2.01 100.00 1.82 100.00
amount but 1 1 1
withdrawal bad
debt provision
for single item
271,734,127. 6,779,708.2 300,425,343 6,779,708.2
Total 100.00 2.49 100.00 2.26
81 7 .92 7
Explanation for categories of account receivable:
In combination, other account receivable withdrawal bad debt provision by age
combination
Balance as at period-end Balance as at period-begin
Portion Portion
age Portion of bad Portion of bad
Bad debt Carrying Bad debt
Carrying value in total debt in total debt
provision value provision
% provisi % provisio
on % n%
Within 1 year
(1 year 66,498,719.48 24.98 --- --- 95,189,395.59 32.27 --- ---
included)
1-2years
(2years 60,907,225.83 22.87 114,441.93 0.19 60,907,765.83 20.65 114,441.93 0.19
included)
2-3years( 3
74,751,119.27 28.07 446,756.15 0.60 74,751,119.27 25.34 446,756.15 0.60
years included)
over 3 years 64,104,664.32 24.08 746,111.28 1.16 64,104,664.32 21.73 746,111.28 1.16
1,307,309. 294,952,945.0 1,307,309.
Total 266,261,728.90 100.00 0.49 100.00 0.44
36 1 36
2. Other account receivable with major single amount or minor amount but conducting
impairment testing independently at period-end
bad debt Withdrawal
Item of other
Carrying value provision proportion reasons
account receivable
amount (%)
106
Other receivable
5,472,398.91 5,472,398.91 100.00 Unrecoverable
hard to recover
Total 5,472,398.91 5,472,398.91 100.00
3. Changes of the bad debt provision for other account receivable
amount amount decreased in this period Carrying
Carrying balance
item withdrawal in this balance at
at period-begin Turn-back Turn-off
period period-end
2011(this period) 6,779,708.27 540.00 --- 540.00 6,779,708.27
4. No arrear made by shareholders units holding over 5% (5% included) voting
rights of the Company appeared in the other account receivables as at period-end.
5. Other account shall be receivable from related parties
Relation with the Portion taken in total other
Unit Arrears
Company account receivable
Wholly-owned
Shenbao Technology 154,734,792.58 56.94
subsidiary
Wholly-owned
Shenbao Sanjing 59,800,000.00 22.01
subsidiary
Subsidiary of
Wuyuan Jufangyong 24,000,000.00 8.83
Shenbao Huacheng
Changzhou Sanjing Oil
Associate 15,060,609.65 5.54
Co., Ltd.
Controlling
Shenbao Huacheng 11,000,000.00 4.05
subsidiary
Shenbao Industry and Wholly-owned
530,589.19 0.20
Trading subsidiary
Total 265,125,991.42 97.57
6. The top 5 arrears in other account receivables as at period-end
Portion taken
Relationship with nature or in total other
Ranks for creditor Arrears Age
the Company content account
receivable
Incomings
Wholly-owned
Shenbao Technology and 154,734,792.58 1-3 years 56.94
subsidiary
outgoings
Incomings
Wholly-owned
Shenbao Sanjing and 59,800,000.00 1-2 years 22.01
subsidiary
outgoings
Subsidiary of Incomings
Wuyuan Jufangyong Shenbao and 24,000,000.00 within 1 year 8.83
Huacheng outgoings
Incomings
Changzhou Sanjing Oil and
Associate 15,060,609.65 1-3 years 5.54
Co., Ltd. outgoings
and interest
Controlling Incomings
Shenbao Huacheng 11,000,000.00 within 1 year 4.05
subsidiary and
107
outgoings
(III)Long-term equity investment
Balance as at period-end Balance as at period-begin
Item Book Provision Carrying Book Provision Carrying
balance reserve value balance reserve value
Investments under 66,724,129.9 2,870,000.0 63,854,129.9 68,789,379.1 2,870,000.0 65,919,379.1
equity method 1 0 1 4 0 4
Investments to joint
--- --- --- --- --- ---
venture company
Investments to 66,724,129.9 2,870,000.0 63,854,129.9 68,789,379.1 2,870,000.0 65,919,379.1
associates 1 0 1 4 0 4
Investments under 241,540,252. 17,537,628. 224,002,624. 176,439,770. 17,537,628. 158,902,142.
cost method 69 53 16 89 53 36
Other equity 25,360,000.0 17,480,000. 25,360,000.0 17,480,000.
7,880,000.00 7,880,000.00
investment 0 00 0 00
Investments to 216,180,252. 216,122,624. 151,079,770. 151,022,142.
57,628.53 57,628.53
subsidiaries 69 16 89 36
308,264,382. 20,407,628. 287,856,754. 245,229,150. 20,407,628. 224,821,521.
Total
60 53 07 03 53 50
1. Investments to Joint Venture Company and associates are detailed in Note V (VII)1.(2)
2. Investments under equity method are detailed in Note V (VII)1.1
3. Investments under cost method
(1) Other equity investment under cost method:
Portion Increase
Inves Decrease
Name of the in the Initial Balance as at during Balance as at
ment during
Companies registere investment co period-begin this period-end
ter this perio
d capital period
Shenzhen Sanjiu
Weitai Holdings Co., --- 0.95% 2,480,000.00 2,480,000.00 --- --- 2,480,000.00
Ltd.
Shenzhen Taiji
15,000,000.0 15,000,000.0
Optical-Electric --- 3.77% 15,000,000.00 --- ---
0 0
Technologies Co., Ltd.
30ye
Wuyuan Jufangyong 38% 7,880,000.00 7,880,000.00 --- --- 7,880,000.00
ars
25,360,000.0 25,360,000.0
Subtotal 25,360,000.00 --- ---
0 0
(2) Investments to subsidiaries under cost method
Portion
Name of Invest Increase Decrease
in the Initial Balance as at Balance as at
the ment during this during thi
registere investment cost period-begin period-end
Companies term period period
d capital
Shenbao 20
100% 80,520,842.36 80,520,842.36 --- --- 80,520,842.36
Sanjing years
Shenbao
30
Industrial 100% 5,500,000.00 5,500,000.00 --- --- 5,500,000.00
years
Trading &
108
Developme
n
Shenbao 25
51% 2,550,000.00 2,550,000.00 --- --- 2,550,000.00
Properties years
Shenbao 30 65,100,481.8
100% 53,451,300.00 53,451,300.00 --- 118,551,781.80
Huacheng years 0
Shenbao 50
100% 5,000,000.00 5,000,000.00 --- --- 5,000,000.00
Investment years
Huizhou
50
Shenbao 100% 4,000,000.00 4,000,000.00 --- --- 4,000,000.00
years
Technology
Shenbao 10yea
53.50% 57,628.53 57,628.53 --- --- 57,628.53
Liaoyuan rs
65,100,481.8
Subtotal 151,079,770.89 151,079,770.89 --- 216,180,252.69
0
*: Found more in (I) of Note IX.
4. Details about impairment reserve of long-term equity investment are set in Note
V (VII)3.
(IV)Operating income and operating cost
Amount as at this period Amount as at previous period
Item
Operating income Operating cost Operating income Operating cost
Main business income 234,424.23 91,320.28 147,753.85 79,866.50
Other business income 1,200,000.00 --- 1,200,000.00 ---
Total 1,434,424.23 91,320.28 1,347,753.85 79,866.50
1. Main business income and main business cost classified according to industry
Amount as at this period Amount as at previous period
Industry Main business Main business Main business Main business
income cost income cost
Industry 234,424.23 91,320.28 147,753.85 79,866.50
Total 234,424.23 91,320.28 147,753.85 79,866.50
2. Main business income and main business cost classified according to products
Amount as at this period Amount as at previous period
Products Main business Main business Main business Main business
income cost income cost
Tea products 234,424.23 91,320.28 147,753.85 79,866.50
Total 234,424.23 91,320.28 147,753.85 79,866.50
109
3. Main business income and main business cost classified according to areas
Amount as at this period Amount as at previous period
Areas Main business Main business Main business Main business
income cost income cost
South of China
234,424.23 91,320.28 147,753.85 79,866.50
(Shenzhen)
Total 234,424.23 91,320.28 147,753.85 79,866.50
4. Main business income in top five clients
Proportion in total main business
name or ranks Total main business income
income (%)
Customer I 51,051.28 21.78
Customer II 17,463.63 7.45
Customer III 16,858.97 7.19
Customer IV 10,439.32 4.45
Customer V 8,829.06 3.77
Total 104,642.26 44.64
(V)Investment income
1. Details of investment income
Amount as at this Amount as at
Project or unit
period previous period
(1) Investment income of long-term equity based on
--- ---
cost
(2) Investment income of long-term equity based on
(269,528.67) (12,550,001.25)
equity(2 units)
(3) Investment income from disposal of long-term
4,279.44 (1,464,996.68)
equity 1 unit)
Total (265,249.23) ( 14,014,997.93)
2. Investment income of long-term equity based on equity
Amount as at this Amount as at Reasons for
unit
period previous period changes
Soaring of economy
Shenzhen Pepsi Coka-Cola
(269,528.67) (11,524,303.61) benefit 经营效益
Beverage Co., ltd.
上升
110
Changzhou Sanjing Oil Co.,
--- (1,025,697.64)
ltd.
Total (269,528.67) (12,550,001.25)
3. Explanation on investment gains
No material restriction will appear in recovery of investment income of the
Company.
(VI)Supplementary information about statement of cash flow
Amount as at this Amount as at
Item
period previous period
I.Net profit adjusted to cash flow of operation activities
Net profit 4,115,925.10 (21,512,714.38)
Add: assets impairment reserve 540.00 ---
Depreciation of fixed assets, consumption of oil assets and
612,945.37 652,719.48
depreciation of productive biology assets
Amortization of intangible assets 912,380.88 190,782.00
Amortization of long-term deferred expenses 139,237.62 137,809.02
Loss from disposal of fixed assets, intangible assets and other
35,326.88 (1,222,901.37)
long-term assets(gain is listed with “-”)
Loss of disposing fixed assets(gain is listed with “-”) --- ---
Loss from change of fair value(gain is listed with “-”) --- ---
Financial expenses (gain is listed with “-”) 3,818,933.23 4,718,700.90
Investment loss (gain is listed with “-”) 265,249.23 14,014,997.93
Decrease of deferred income tax asset( (increase is listed with
--- ---
“-”)
Increase of deferred income tax liability (decrease is listed with
--- ---
“-”)
Decrease of inventory (increase is listed with “-”) (127,251.46) (100,537.21)
Decrease of operating receivable accounts (increase is listed with
(25,484,518.54) (25,361,401.41)
“-”)
Increase of operating payable accounts (decrease is listed with
(5,820,354.51) 916,698.99
“-”)
Others --- ---
Net cash flow arising from operating activities (21,531,586.20) (27,565,846.05)
II. Material investment and financing not involved in cash flow
Liabilities converted to capital --- ---
Convertible bond expire in 1 year --- ---
Fixed assets leased through financing --- ---
III.Net change of cash and cash equivalents
111
Balance of cash at period end 564,324,133.25 36,726,511.57
Less: Initial balance of cash 23,617,846.34 76,004,694.03
Plus: Balance of cash equivalents at the period end --- ---
Less: Initial balance of cash equivalents --- ---
Net increasing of cash and cash equivalents 540,706,286.91 (39,278,182.46)
XII.Supplementary information
(I) Item of current non-recurring gains and losses
Amount this
Item Remarks
period
Gains and loses from
disposal of non-current (21,707.57)
assets
Tax refund or exemption out
of authorization, with
absence of official ---
approval document or
accidentally
Government grant recorded
in current gains and
losses (other than such
government grant
which closely relates to
310,048.00
business of the
Company and is
enjoyed in accordance
to unified standard
amount or quantity)
Capital occupation fee
collected from
non-financial
---
enterprises recorded
incurrent gains and
losses
Income occurred when
investment cost paid by
enterprise for obtaining
subsidiaries, associates
and joint ventures are ---
lower than its share in
fair value of net
realizable assets of
invested units;
.Gains and losses from
exchange of ---
non-monetary assets
Gains and losses from
entrusted investment or ---
management assets
Various asset impairment
reserve provided for ---
force majeure, such as
112
natural disaster;
Gains and losses from debt
---
reorganization
Reorganization expenses,
such as expenditure for
---
allocation of employees
and integration fee
Gains and losses from
excess of transaction
which are conducted on ---
a non-fair-valued basis
over its fair value
Current net gains and losses
of subsidiaries occurred
from combination
under the same control ---
commencing from
period-begin to
combination date
Gains and losses from
contingent events
which has no relation ---
with normal business of
the Company
Gains and losses from
change of fair values of
held-for-transaction
financial assets and
financial liabilities
except for the effective
hedge business related
to normal business of (42,000.00)
the Company, and
investment income
from disposal of
transactional financial
assets and liabilities
and financial assets
available for sale
Reversal of impairment
reserve for account
---
receivable with separate
impairment testing
gains/ losses from external
---
entrustment loans
Gains and losses arising
from change of fair
value of investment
---
properties whose
follow-up measurement
are at fair value
Affect upon current
gains/losses arising
from the one-off
---
adjustment in subject to
requirement of laws
and rules in relation to
113
taxation and accounting
Income from entrusted
---
custody operation
Other non-operating income
and expenditure except 17,088,944.71
the abovementioned
Other item that satisfied the
definition of
---
non-recurring gains and
losses
Impact on income tax (82,282.16)
Impact on minority
shareholders’ equity 10,003.90
(After tax)
Total 17,263,006.88
(II)Return on equity and earnings per share:
1. Return on equity
Return on equity Earnings per share
Profit during period Diluted
Basic earnings
Weighted average earnings per
per share
share
Net profit attributable to
shareholders of ordinary shares of 1.34% 0.0242 0.0242
the Company
Net profit (net of non-current gains
and losses) attributable to
(3.93%) (0.0707) (0.0707)
shareholders of ordinary shares of
the Company
(1)Potential ordinary shares though without dilution this year while likely to be diluted in
later periods.
(2)No material change happened to numbers of ordinary shares in issue or potential
ordinary shares, within the period commencing from balance sheet date to approval date
for financial statements.
XIII. Difference on data between the CAS and IAS
Due to that Company issued B-shares, while preparing the financial report in accordance
with Accounting System for Business Enterprises, the Company still compiled the
financial statement based on IAS. The Company did not engage international certified
public accountants. The differences in net asset and net profit in the financial statement
based on CAS and IAS were as follows:
Net asset Net profit
In accordance with IAS 888,995,232.77 4,396,354.98
1. Adjustment on amortization of
(1,016,958.04) ---
differences of equity investment
2. Adjustment on cost of transferring
381,359.27 ---
Shenzhen Pepsi’s equity
3. Adjustment on other regulating (1,067,000.00) ---
114
fund of stock market payable:
4. Capitalization of interest of land
--- ---
use right
In accordance with Accounting
887,292,634.00 4,396,354.98
Standard for Business Enterprises
XIV. Approval for reporting of financial statements
The financial statements of the Company have obtained approval for reporting from the
board of directors of the Company as at 18 August 2011.
Chapter VII. Documents available for Reference
There are complete following documents in Secretariat of the Board of the Company
provided for reference upon demand of China Securities Regulatory Commission,
Shenzhen Stock Exchange and the shareholders of the Company, the documents
including:
1. Semi-annual Report and Summary of 2011 with the signatures of the Chairman;
2. Financial Statements with the signatures and seals of the legal representative, CFO, and
manager of the accounting department;
3. Original and official copies of all documents which have been disclosed on Securities
Times, China Securities Journal, and Hong Kong Commercial Daily in the report term.
Chairman of the Board: Zheng Yuyi
Shenzhen Shenbao Industrial Co., Ltd.
18 August 2011
115
