2019 Interim Report Summary of Shandong Chenming Paper Holdings Limited
Stock code: 000488 200488 Stock abbreviation: Chenming Paper Chenming B Announcement No.: 2019-088
2019 Interim Report Summary of
Shandong Chenming Paper Holdings Limited
I. IMPORTANT NOTICE
This interim report summary is extracted from the text of the interim report. For the full understanding of the operating
results, financial position and plan for further development, investors should carefully read the text of the interim report
published on the media as designated by the CSRC.
Non-standard auditor’s opinion
□ Applicable √ Not applicable
Plans for profit distribution on ordinary shares or conversion of capital reserves into share capital proposed to the Board
during the reporting period
□ Applicable √ Not applicable
The Company does not propose distribution of cash dividends or bonus shares, and there will be no increase of share
capital from reserves.
Plans for profit distribution on preference shares for the reporting period approved by the Board
□ Applicable √ Not applicable
II. BASIC INFORMATION ABOUT THE COMPANY
1. Company profile
晨鸣纸业 000488
晨鸣B 200488
Stock abbreviation 晨鸣优01 Stock code 140003
晨鸣优02 140004
晨鸣优03 140005
Stock exchanges on which the shares are
Shenzhen Stock Exchange
listed
Stock abbreviation 晨鸣纸业 Stock code 01812
Stock exchanges on which the shares are
The Stock Exchange of Hong Kong Limited
listed
Legal name in Chinese of the Company 山东晨鸣纸业集团股份有限公司
Legal short name in Chinese of the
晨鸣纸业
Company
Legal name in English of the Company (if
SHANDONG CHENMING PAPER HOLDINGS LIMITED
any)
Legal short name in English of the
SCPH
Company (if any)
Legal representative of the Company Chen Hongguo
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2019 Interim Report Summary of Shandong Chenming Paper Holdings Limited
2. Major accounting data and financial indicators
Retrospective adjustment to or restatement of the accounting data for prior years by the Company
□ Yes √ No
The Increase/decrease for the
The reporting corresponding reporting period as compared
period period of the prior to the corresponding period
year of the prior year
15,551,334,039.8
Revenue (RMB) 13,348,648,113.70 -14.16%
9
Net profit attributable to shareholders of the
509,795,572.29 1,784,631,025.31 -71.43%
Company (RMB)
Net profit after extraordinary gains or losses
attributable to shareholders of the Company 303,144,996.21 1,537,896,765.44 -80.29%
(RMB)
Net cash flows from operating activities
2,699,770,891.69 4,745,037,920.91 -43.10%
(RMB)
Basic earnings per share (RMB per share) 0.013 0.36 -96.39%
Diluted earnings per share (RMB per share) 0.013 0.36 -96.39%
Rate of return on net assets on weighted
0.21% 5.77% -5.56%
average basis
Increase/decrease as at the
As at the end of
As at the end of end of the reporting period
the reporting
the prior year as compared to the end of
period
the prior year
106,558,750,961.4 105,318,734,827.
Total assets (RMB) 1.18%
2 82
Net assets attributable to shareholders of the 25,048,731,454.7
24,468,978,032.01 -2.31%
Company (RMB) 9
Data specification for basic earnings per share, diluted earnings per share, and rate of return on weighted average
net assets:
Net profit attributable to shareholders of the Company does not exclude the effect of interest of perpetual bonds
and the dividends of preference shares paid and declared to be paid. When calculating financial indicators such as
earnings per share and the rate of return on net assets on weighted average basis, the interest for perpetual bonds from 1
January 2019 to 30 June 2019 of RMB96,202,739.73 and the dividend on preference shares paid and declared to be paid
in 2019 of RMB377,169,767.52 are deducted.
3. Total number of shareholders and shareholdings
Unit: share
Total number of shareholders of
Total number of 130,823, of which 110,298 were
preference shares with restored
shareholders of ordinary holders of A shares, 20,157 were
voting right as at the end of the 0
shares as at the end of the holders of B shares and 368 were
reporting period, if any (see Note
reporting period holders of H shares
8)
Shareholdings of shareholders interested in more than 5% of the shares of the Company or Top 10 shareholders
Change Share pledged or
Numb
Number of s Number locked-up
er of
ordinary (increas of
Percent restric
Nature of shares held e or non-restri Stat
age of ted
Name of shareholders shareholde at the end decreas ct us
shareho ordina
rs of the e) ordinary of Number
lding ry
reporting during shares shar
shares
period the held es
held
Reporti
2
2019 Interim Report Summary of Shandong Chenming Paper Holdings Limited
ng
period
State-owne Ple
CHENMING HOLDINGS 445,396,12 125000 445,396,1
d legal 15.33% 0 dge 333,499,836
COMPANY LIMITED 8 0 28
person d
Overseas
HKSCC NOMINEES 373,067,62 373,067,6
legal 12.84% -220250 0
LIMITED 5 25
person
Overseas
CHENMING HOLDINGS 364,131,56 364,131,5
legal 12.54% 0 0
(HONG KONG) LIMITED 3 63
person
State-owne
CENTRAL HUIJIN ASSET 60,206,85
d legal 2.07% 60,206,850 0 0
MANAGEMENT LTD. 0
person
AGRICULTURAL BANK Others
1,816,3 15,982,75
OF CHINA LIMITED - 0.55% 15,982,750 0
00 0
CHINA CSI 500 ETF
VANGUARD Overseas
12,912,35
EMERGING MARKETS legal 0.44% 12,912,357 0 0
7
STOCK INDEX FUND person
VANGUARD TOTAL Overseas
11,351,62
INTERNATIONAL STOCK legal 0.39% 11,351,620 354,212 0
0
INDEX FUND person
Domestic
Chen Hongguo nature 0.38% 11,080,044 935,600 0 2,770,011
person
Domestic
10,800,20
Chen Suiqiang nature 0.37% 10,800,200 899,050 0
0
person
Domestic
-1,114,4 10,610,32
Jin Xing nature 0.37% 10,610,329 0
21 9
person
A shareholder, Chenming Holdings (Hong Kong) Limited, which is an overseas legal person,
is a wholly-owned subsidiary of a shareholder, Shouguang Chenming Holdings Company
Related party relationship or Limited, which is a state-owned legal person. A shareholder, Chen Hongguo, is the legal
acting in concert among the representative, chairman and general manager of Chenming Holdings Company Limited.
above shareholders Save for the above, it is not aware that any other shareholders of tradable shares are persons
acting in concert and is also not aware that any other shareholders of tradable shares are
connected with each other.
Shareholdings of the top ten shareholders of non-restricted ordinary shares
Number of non-restricted
Class of shares
ordinary shares held as at
Name of shareholders
the end of the reporting
Class of shares Number
period
CHENMING HOLDINGS COMPANY
445,396,128 RMB ordinary shares 445,396,128
LIMITED
Overseas listed
HKSCC NOMINEES LIMITED 373,067,625 373,067,625
foreign shares
Domestic listed foreign
210,717,563
CHENMING HOLDINGS (HONG KONG) shares
364,131,563
LIMITED Overseas listed
153,414,000
foreign shares
CENTRAL HUIJIN ASSET
60,206,850 RMB ordinary shares 60,206,850
MANAGEMENT LTD.
Agricultural Bank of China Limited -
15,982,750 RMB ordinary shares 15,982,750
CSI500 Index Open-ended Fund
VANGUARD EMERGING MARKETS Domestic listed foreign
12,912,357 12,912,357
STOCK INDEX FUND shares
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2019 Interim Report Summary of Shandong Chenming Paper Holdings Limited
VANGUARD TOTAL INTERNATIONAL Domestic listed foreign
11,351,620 11,351,620
STOCK INDEX FUND shares
Chen Suiqiang 10,800,200 RMB ordinary shares 10,800,200
Domestic listed foreign
Jin Xing 10,610,329 10,610,329
shares
LSV EMERGING MARKETS EQUITY Domestic listed foreign
9,154,200 9,154,200
FUND, L.P. shares
Related party relationship or acting A shareholder, Chenming Holdings (Hong Kong) Limited, which is an overseas legal
in concert among the top ten person, is a wholly-owned subsidiary of a shareholder, Shouguang Chenming Holdings
ordinary shareholders of Company Limited, which is a state-owned legal person. Save for the above, it is not
non-restricted ordinary shares, and aware that any other shareholders of tradable shares are persons acting in concert. It is
between the top ten shareholders of also not aware that any other shareholders of tradable shares are related to each other.
non-restricted ordinary shares and
the top ten ordinary shareholders
Chenming Holdings Company Limited held 445,396,128 RMB ordinary shares, of
Securities margin trading of top 10
which 402,196,128 shares were held through ordinary account and 43,200,000 shares
ordinary shareholders
were held through credit guarantee security account.
4. Change of controlling shareholders or beneficial controllers
The change of controlling shareholders during the reporting period
□ Applicable √ Not Applicable
There was no change of controlling shareholders of the Company during the reporting period.
Change of beneficial owner during the reporting period
□ Applicable √ Not Applicable
There was no change of beneficial owner of the Company during the reporting period.
5. Total number of holders of preference shares and the shareholdings of top ten holders of
preference shares
√ Applicable □ Not Applicable
Unit: share
Total number of shareholders of preference shares as at the end
7
of the reporting period
Holders holdings more than 5% of the preference shares of the Company or top ten holders of preference shares
Changes Share pledged or
Number of
(increase locked-up
Preferenc preference
or
Nature of e shares held
Name of shareholders decrease) Status
shareholders sharehold at the end of
during the of Number
ing the reporting
reporting shares
period
period
Domestic
BEIJING YIBEN ZHONGXING
non-state-ow Pledge 12,500,00
INVESTMENT MANAGEMENT 27.78% 12,500,000 0
ned legal d 0
CO., LTD.
person
BANK OF COMMUNICATIONS
INTERNATIONAL TRUST CO.,
Others 22.44% 10,100,000 0
LTD. - HUILI NO.167 SINGLE
CAPITAL TRUST
BANK OF COMMUNICATIONS
MINTERNATIONAL TRUST CO.,
Others 14.22% 6,400,000 0
LTD. - HUILI NO.136 SINGLE
CAPITAL TRUST
QILU BANK CO., LTD. - QILU
BANK QUANXIN WEALTH Others 13.33% 6,000,000 0
MANAGEMENT PRODUCT
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2019 Interim Report Summary of Shandong Chenming Paper Holdings Limited
SERIES
Domestic
non-state-ow
HENGFENG BANK CO., LTD. 11.11% 5,000,000 0
ned legal
person
SHANGHAI STATE-OWNED State-owned
6.67% 3,000,000 0
ASSETS OPERATION CO., LTD. legal person
NCF - MINSHENG BANK –
CHINA FORTUNE
INTERNATIONAL TRUST –
Others 4.44% 2,000,000 0
CHINA FORTUNE TRUSTMIN
XIN NO. 11 SINGLE CAPITAL
TRUST
The aforesaid holders of preference shares, “BANK OF COMMUNICATIONS
Related party relationship or acting INTERNATIONAL TRUST CO., LTD. – UILI NO.167 SINGLE CAPITAL
in concert among the top ten holders TRUST” and “BANK OF COMMUNICATIONS INTERNATIONAL TRUST
of preference shares, and between CO., LTD. - HUILI NO.136 SINGLE CAPITAL TRUST”, are persons acting in
the top ten holders of preference concert. Save for the above, it is not aware that whether the remaining holders
shares and the of preference shares are persons acting in concert. It is also not aware that the
top ten holders of ordinary shares top ten holders of preference shares and the top ten holders of ordinary shares
are related to each other.
6. Corporate Bonds
Are there any corporate bonds offered to the public and listed on stock exchanges which do not become due as at the
date of approval of interim report or overdue but not fully settled?
Yes
(1) Basic information on corporate bonds
Outstanding
amount of
Bond Bond Issue Maturity Interest Payment
Name of bond the bonds
abbreviation code date date rate method
(RMB’0,000
)
Interest is paid
The public issuance
annually. The
of the corporate
principal
bonds of Shandong 17 17 21
amount and the
Chenming Paper Chenming 112570 August August 120,000 6.50%
last interest
Holdings Limited to Bond 01 2017 2022
payment will be
qualified investors in
paid on the
2017 (tranche I)
maturity date.
Interest is paid
The public issuance
annually. The
of the corporate
principal
bonds of Shandong 18
29 March 02 April amount and the
Chenming Paper Chenming 112641 90,000 7.28%
2018 2023 last interest
Holdings Limited to Bond 01
payment will be
qualified investors in
paid on the
2018 (tranche I)
maturity date.
Stock exchange on which corporate
Shenzhen Stock Exchange
bonds are listed or transferred
Online subscription: Public investors with A share security account opened
under China Securities Depository and Clearing Co., Ltd. Offline subscription:
Investor eligibility arrangement
Institutional investors with A share security account opened under China
Securities Depository and Clearing Co., Ltd.
Interest payment of corporate bonds
There was no interest payment during the reporting period.
during the reporting period
Performance of relevant terms during Both 17 Chenming Bond 01 and 18 Chenming Bond 01 attach with options for
the reporting period, for special the issuer to adjust the coupon rate and for investors to resell. The issuer has the
terms such as issuer or investor right to determine the adjustment to the coupon rate for the following 3 years at
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2019 Interim Report Summary of Shandong Chenming Paper Holdings Limited
option and interchangeable for the end of the second year and the adjustment to the coupon rate for the
corporate bonds (if any) following year as the end of the fourth year. After issuing the announcement on
whether the coupon rate of the relevant tranche of bonds will be adjusted and
the range of adjustment, the investors have the right to register for reselling
during the period as announced to resell all or part of the relevant tranche of
bonds held to the issuer at par value.
(2) Financial indicators as at the end of the reporting period
Unit: RMB’0,000
Increase/decrease as at the
As at the end of the As at the end of the end of the reporting period as
Item
reporting period prior year compared to the end of the
prior year
Gearing ratio 76.25% 75.43% 0.82%
Current ratio 77.56% 78.10% -0.54%
Quick ratio 70.30% 69.54% 0.76%
Increase/decrease of the
The corresponding reporting period as compared
Item The reporting period
period of the prior year to corresponding period of
the prior year
EBITDA interest coverage
1.64 2.70 -39.26%
ratio
Loans payment ratio 100.00% 100.00% 0.00%
Interest payment ratio 100.00% 100.00% 0.00%
Major reason for more than 30% in year-on-year change for the above accounting data and financial indicators:
√ Applicable □ Not Applicable
EBITDA interest coverage ratio recorded a decrease of 39.26%, which was mainly due to the year-on-year decrease of
profit during the reporting period.
III. Discussion and Analysis of Operations
1. Principal operations of the Company during the Reporting Period
Whether the Company needs to comply with the disclosure requirements of specific industries
No
(I) Principal activities of the Company during the reporting period
The Company is a large conglomerate principally engaged in pulp production and paper making with synergistic
development in finance, mining, forestry, logistics and construction materials. The Company is the only listed company
with A shares, B shares and H shares in China. It is among the top 100 listed companies in China and the top 10 star
enterprises in China, and is rated as one of the 50 most competitive blue chip companies in China. It has been honoured
over 200 titles above the provincial level including the China May 1st Labour Prize, the Top 10 Best Light Industry
Enterprises in China, Outstanding Contribution Prize in Business Administration in China and the National Spiritual
Civilisation Advanced Unit. Its key indicators in respect of business and economic efficiency have been in a leading
position in the industry in China for over 20 consecutive years. The machine-made paper business is the principal
activity and the major source of revenue and profit of the Company. During the reporting period, there was no
significant change in the principal activity of the Company.
Recently, the Company has committed itself to implementing the “forestry, pulp and paper integration” strategy. It
currently has three major pulp mills in Zhanjiang, Huanggang and Shouguang. It has the largest wood pulp production
capacity in China with annual production capacity of more than 4.2 million tonnes. It is the first integrated pulp and
paper enterprise in China to be able to produce wood pulp to meet its paper making demand and its pulp production
capacity and paper production capacity complement each other perfectly. Leveraging the integrated forestry, pulp and
paper project, the Company is the enterprise that offers the widest product range in the paper making industry, and its
products include culture paper, white paper board, coated paper, household paper, electrostatic copy paper and thermal
paper, with each major product ranking among the best in China in terms of market share.
The Company has scientific research institutions including the national enterprise technology centre, the
postdoctoral working station as well as state certified CNAS pulp and paper testing centre and has obtained over 150
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2019 Interim Report Summary of Shandong Chenming Paper Holdings Limited
national patents including 17 patents for invention, with 7 products selected as national new products and 35 products
filling the gap in China. The Company has obtained 21 Science and Technology Progress Awards above the provincial
level and undertaken five national science and technology projects and 26 provincial technological innovation projects.
The Company has obtained the ISO9001 quality certification, ISO14001 environmental protection certification and
FSC-COC certification, leading among its industry peers.
(I I) Management situation for the reporting period
During the reporting period, although the general operation of the Company is in good condition, the Company experienced
huge challenges as other paper making enterprises did in the complex and changing domestic and international economic situation.
Affected by various factors such as economic downturn, reduced market demand, tight supply and rising prices of raw materials, the
paper making industry experienced a decline in economic efficiency, increased difficulties in production and operation, and falling
paper prices. Accordingly, the Company achieved net profit of only RMB38.22 million in the first quarter, representing a decrease of
95.12% as compared to the corresponding period of prior year.
Since the second quarter, the market improved significantly. The prices of the major paper types had been on the rise, and the
benefits of the paper price rise were obvious. The Shouguang Meilun 510,000 tonne high-ended cultural paper project, the
Shouguang Headquarters cultural paper transformation project, the Shouguang Meilun 1,000,000 tonne chemical pulp project, the
Huanggang Chenming chemical pulp project and others invested and constructed by the Company were successively put into
operation with smooth operation in the second quarter, and gradually began to play their role. The profitability of the Company
improved significantly in the second quarter with a quarter-on-quarter increase of 1,157.95%.
In the first half of 2019, the Company completed the production of machine-made paper of 2.15 million tonnes with sales of
2.39 million tonnes and achieved revenue of RMB13,349 million, a year-on-year decrease of 14.16%. The Company recorded
operating costs of RMB9,754 million, a year-on-year decrease of 4.93%. Total profit and net profit attributable to equity holders of
the Company were RMB662 million and RMB510 million respectively, down by 70.12% and 71.43% from the prior year. The
Company’s total assets amounted to RMB106,559 million.
At present, the four major pulp and paper projects of the Company have been completed and commenced operation. There is
no major project expenditure in the future; and the financial leasing company continued to reduce its business scale, and finance
expenses will be effectively controlled. In the second half year, as the four major pulp and paper projects will operate at full capacity
and fully realised their benefits, the Company will achieve a balance between the pulp production capacity and paper production
capacity. The advantages of its pulp and paper integration will be obvious with significantly higher gross profit margin, thereby
effectively enhancing the overall profitability and risk aversion ability of the Company.
2. EVENTS RELATING TO THE FINANCIAL REPORT
(1) Reason for changes in accounting policies, accounting estimates and accounting methods as compared to
the financial report for the prior year
□ Applicable √ Not applicable
There was no change in accounting policies, accounting estimates and accounting methods of the Company during the
reporting period.
(2) Reason for retrospective restatement to correct major accounting errors during the reporting period
□ Applicable √ Not applicable
No retrospective restatement was made to correct major accounting errors during the reporting period.
(3) Reason for changes in scope of the consolidated financial statements as compared to the financial report
for the prior accounting period
√ Applicable □Not applicable
During the reporting period, the scope of consolidation increased and one new subsidiary was established, which was
Shanghai Chenming Pulp & Paper Sales Co., Ltd.
7
