Hubei Sanonda Co., Ltd.
The Third Quarterly Report 2010
§1. Important Notes
1.1 The Board of Directors, the Supervisory Committee and directors, supervisors and
senior management of Hubei Sanonda Co., Ltd. (hereinafter referred to as “the
Company”) hereby guarantee that this report contains no false information,
misleading statements or material omissions, and will, individually and collectively,
accept responsibility for the factuality, accuracy and completeness of this report.
1.2 The Financial Report of this third quarterly report has not been audited by a CPA
firm.
1.3 Mr. Li Zuorong, Person-in-charge of the Company, Mr. He Xuesong,
Person-in-charge of the accounting work and the accounting firm hereby confirm the
factuality and completeness of the Financial Report in this quarterly report.
§2. Company Profile
2.1 Main accounting data and financial indexes
Unit: (RMB) Yuan
As at 30 Sep. 2010 As at 31 Dec. 2009 Increase/decrease (%)
Total assets (RMB) 2,310,237,077.29 2,039,070,607.41 13.30%
Owners’ equity attributable to shareholders of
listed company (RMB)
1,104,792,446.63 1,087,987,662.96 1.54%
Share capital (share) 593,923,220.00 593,923,220.00 0.00%
Net assets per share attributable to
shareholders of listed company (RMB/share)
1.86 1.83 1.64%
Jul.-Sep. 2010
Increase/decrease
year-on-year (%)
Jan.-Sep.2010
Increase/decrease
year-on-year (%)
Total operation income (RMB) 397,545,395.33 1.55% 1,193,813,565.71 -13.29%
Net profit attributable to shareholders of listed
company (RMB)
3,613,543.38 85.56% 16,023,240.46 -65.22%
Net cash flows generated from operating
activities (RMB)
- - -63,187,626.08 -200.47%
Net cash flows per share generated from
operating activities (RMB/share)
- - -0.11 0.47%
Basic earnings per share (RMB/share) 0.0061 84.85% 0.0270 -65.21%Diluted earnings per share (RMB/share) 0.0061 84.85% 0.0270 -65.21%
Weighted average return on net assets (%) 0.33% 0.16% 1.46% -2.67%
Weighted average return on net assets after
deducting extraordinary gains and losses (%)
0.33% 0.16% 1.77% -2.37%
Items of non-recurring gains and losses
Amount from year-begin to the
end of this report period
Notes
Gains and losses from disposal of non-current assets 573,401.85
Other non-business income and expenses besides the above items -331,390.53
Other items that fit the definition of extraordinary gains and losses -4,850,000.00
Effect on income tax 1,151,997.17
Effect on minority interest 45,597.77
Total -3,410,393.74 -
2.2 Total number of shareholders at period-end and shareholding of top ten
shareholders holding tradable shares
Unit: share
Total number of shareholders at period-end 83,535 (including 57,699 A-share shareholders)
Shareholding of top ten shareholders holding tradable shares
Full name of shareholder
Number of tradable shares
held at period-end
Type of share
Sanonda Group Company 118,887,202 RMB ordinary shares
Administrative Bureau of State-owned Property of Qichun County 4,489,266 RMB ordinary shares
Li Dongliang 3,105,223 RMB ordinary shares
Yuan Haixiang 3,002,349 RMB ordinary shares
Huang Yangsheng 2,678,950 RMB ordinary shares
Rural Credit Cooperatives Union in Shashi District of Jingzhou 2,500,000 RMB ordinary shares
Luo Qian 2,435,666 RMB ordinary shares
Hong Qina 2,412,494 RMB ordinary shares
Zhou Baoping 2,254,327 RMB ordinary shares
Yang Shihui 2,184,089 RMB ordinary shares
§ 3 Significant Events
3.1 Particulars about major changes of main accounting statement items and financial
indicators, as well as reasons for the changes
√Applicable □InapplicableItem in
financial
statements
As at 30
Sep. 2010
Amount at
year-begin
Increase/
decrease
Ratio of
increase/
decrease
Main reasons for changes
Accounts
receivable
18,638 6,586 12,052 183.00% The credit was not due.
Construction
in progress
44,067 28,786 15,281 53.09%
Mainly because investment on the thermo-electricity
joint production project increased
Short-term
borrowings
20,754 3,990 16,764 420.16% Increase of capital needs for production and projects
Taxes payable -1,902 -446 -1,456 326.60% Increase of the pending deduct VAT on purchase
Non-current
liabilities due
within 1 year
16,000 9,500 6,500 68.42%
In order to increase current funds in for export of high
technical products in the Export-import Bank of
China, the Company borrowed RMB 115,000,000 due
within one year.
Jan.-Sep.
2010
Same
period of
last year
Increase/
decrease
Ratio of
increase/
decrease
Main reasons for changes
Investment
income
-
1,587
-1,587 -100.00%
There were income from subsidiary disposal at the
same period of last year.
Non-operating
income
117 539 -422 -78.24%
There were income from disposal of fixed assets at the
same period of last year
Total profit 2,574 5,675 -3,101 -54.65%
Considerable decrease of gross profit rate of leading
products
3.2 Progress and influence of significant events, as well as the analysis on solutions
□Applicable √Inapplicable
3.2.1 About non-standard opinion
□Applicable √Inapplicable
3.2.2 The Company offer capital to the controlling shareholder or other related
parties and provide external guarantees in violation of the prescribed procedures.
□Applicable √Inapplicable
3.2.3 Signing contract and execution of contract on routine operation
□Applicable √Inapplicable
3.2.4 Others
□Applicable √Inapplicable
3.3 Fulfillment of the commitment made by the Company, shareholders and the actual
controller
□Applicable √Inapplicable
3.4 Warnings of possible losses or major changes of the accumulative net profitachieved during the period from year-begin to the end of the next report period
compared with the same period of last year, as well as explanation on reasons
√Applicable □Inapplicable
Performance forecast Significant drop in the same direction
1 Jan. 2010-31 Dec. 2010
1 Jan. 2009-31 Dec.
2009
Increase/ decrease (%)
Estimated accumulative net
profit (RMB’0000)
0.00 -- 965.00 1,931.00 descend 50.00% -- 100.00%
Basic earnings per share
(RMB/share)
0.00 -- 0.0163 0.0325 descend 50.00% -- 100.00%
Notes to performance forecast
the weak agrochemical market may continue with overcapacity in the pesticide sector as a
whole, which will make it difficult for the Company to sell products and will lead to a price
drop for some products of the Company.
3.5 Other significant events
3.5.1 Particulars about securities investment
□Applicable √Inapplicable
3.5.2 Particulars about receiving investigation & research, communication and
interview in this report period
In the report period, the Company was in strict compliance with the Guide of
Shenzhen Stock Exchange on Fair Information Disclosure for Listed Companies. In
progress of reception of calls from minority investors’ calls, the Company explained
basic operating status, industrial development and supply & marketing of the
Company with principle of fair, equity and publicity. The Company never selectively,
secretly leaked significant information which was undisclosed to special object in
advance, which kept fair of information disclosure.
3.6 Investment of financial derivatives
□Applicable √Inapplicable
3.6.1 Financial derivatives held at the end of report period
□Applicable √Inapplicable
§4 Attachment
4.1 Balance Sheet
Prepared by Hubei Sanonda Co., Ltd. 30 Sep. 2010 Unit: RMB Yuan
Balance at period-end Balance at year-begin
Items
Consolidation Parent company Consolidation Parent company
Current assets:
Monetary capital 447,008,534.86 365,653,741.82 474,460,623.29 424,584,953.40Settlement funds
Landings to banks or other financial
institutions
Transaction monetary assets
Notes receivable 18,757,150.63 15,480,850.63 10,746,710.09 2,714,810.09
Accounts receivables 186,376,463.92 64,547,513.13 65,857,262.23 9,940,149.67
Prepayments 21,061,348.03 22,962,471.79 24,018,481.41 25,138,734.64
Premium receivables
Receivables from reinsures
Reinsurance contract reserve receivables
Interest receivables
Dividend receivables 3,275,227.72
Other receivables 20,457,653.95 146,209,510.74 19,220,669.32 97,072,583.33
Financial assets purchased under
agreements to resell
Inventories 263,471,444.93 220,289,161.32 198,762,663.23 146,279,805.97
Non-current assets due within 1 year
Other current assets
Total current assets 957,132,596.32 838,418,477.15 793,066,409.57 705,731,037.10
Non-current assets:
Loans and advances
Available-for-sale financial assets
Investments held to maturity
Long-term receivables
Long-term equity investments 11,378,382.63 49,533,405.95 11,378,382.63 49,533,405.95
Investment properties 4,988,600.50 4,988,600.50 5,116,012.50 5,116,012.50
Fixed assets 735,738,025.91 684,481,024.61 778,661,093.09 728,578,456.14
Construction in progress 440,670,431.40 423,144,357.59 287,858,631.17 281,349,294.67
Construction materials
Disposal of fixed assets 348,918.90 338,536.46
Production biological assets
Oil-gas assets
Intangible assets 147,478,392.04 134,122,973.02 150,488,348.86 136,774,286.23
Development expenditures
goodwillLong-term deferred expenses
Deferred tax assets 12,501,729.59 10,146,664.99 12,501,729.59 10,146,664.99
Other non-current assets
Total non-current assets 1,353,104,480.97 1,306,755,563.12 1,246,004,197.84 1,211,498,120.48
Total assets 2,310,237,077.29 2,145,174,040.27 2,039,070,607.41 1,917,229,157.58
CURRENT LIABILITIES:
Short-term borrowings 207,540,045.64 160,000,000.00 39,899,274.54 35,000,000.00
Borrowings from central bank
Deposits received and held for others
Borrowings from banks and other financial
institutions
Held-for-trading financial liabilities
Notes payable 5,000,000.00 5,000,000.00
Accounts payable 114,392,631.16 71,562,086.54 116,941,353.00 66,229,596.12
Advances from customers 31,439,372.98 17,528,796.17 30,731,258.63 18,309,739.93
Financial assets sold under agreements to
repurchase
Fees and commissions payables
Payroll payables 7,448,176.47 4,361,408.22 17,231,898.45 13,295,096.69
Taxes payable -19,020,806.24 -9,436,044.89 -4,458,696.03 2,208,088.91
Interest payables
Dividend payables 349,463.30 349,463.30 349,463.30 349,463.30
Other payables 65,791,680.70 43,364,257.76 39,413,834.96 27,182,609.39
Accounts due to reinsurance
Insurance contract reserves
Receiving from vicariously traded
securities
Receiving from vicariously sold securities
Non-current liabilities due within 1 year 160,000,000.00 160,000,000.00 95,000,000.00 95,000,000.00
Other current liabilities
Total current liabilities 567,940,564.01 447,729,967.10 340,108,386.85 262,574,594.34
Non-current liabilities
Long-term borrowings 606,560,000.00 606,560,000.00 579,560,000.00 579,560,000.00
Bonds payable
Long-term payables 9,840,000.00 9,840,000.00 9,840,000.00 9,840,000.00Special payables
Estimated liabilities
Deferred tax liabilities
Other non-current liabilities 9,209,677.27 6,990,000.00 9,209,677.27 6,990,000.00
Total non-current liabilities 625,609,677.27 623,390,000.00 598,609,677.27 596,390,000.00
Total liabilities 1,193,550,241.28 1,071,119,967.10 938,718,064.12 858,964,594.34
Owners’ equity (or shareholders’ equity)
Paid-in capital (or share capital) 593,923,220.00 593,923,220.00 593,923,220.00 593,923,220.00
Capital surplus 271,591,478.35 268,447,075.77 271,591,478.35 268,447,075.77
Less: treasury stock
Specific reserves 21,471,363.20 13,261,952.35 20,689,819.99 13,898,173.74
Surplus reserves 72,736,287.77 72,736,287.77 72,736,287.77 72,736,287.77
General risk provision
Retained earnings 145,070,097.31 125,685,537.28 129,046,856.85 109,259,805.96
Foreign exchange difference
Total owners’ equity attributable to holding
company
1,104,792,446.63 1,074,054,073.17 1,087,987,662.96 1,058,264,563.24
Minority interest 11,894,389.38 12,364,880.33
Total owner’s equity 1,116,686,836.01 1,074,054,073.17 1,100,352,543.29 1,058,264,563.24
Total liabilities & owner’s equity 2,310,237,077.29 2,145,174,040.27 2,039,070,607.41 1,917,229,157.58
4.2 Income Statement as of this report period
Prepared by Hubei Sanonda Co., Ltd. Jul.-Sep. 2010 Unit: RMB Yuan
This report period Same period of last year
Items
Consolidation Parent company Consolidation Parent company
1. Total operation revenue 397,545,395.33 301,393,561.22 391,469,870.34 265,327,896.10
Including: sales revenue 397,545,395.33 301,393,561.22 391,469,870.34 265,327,896.10
Interest income 0.00 0.00
Premium income 0.00 0.00
Fee and commission income 0.00 0.00
2. Total operation cost 392,700,921.83 299,269,598.80 411,539,316.38 284,125,686.30
Including: cost of sales 347,691,756.04 265,051,536.21 351,295,507.34 244,357,782.68
Interest expenses 0.00 0.00
Service charges and commission expenses 0.00 0.00
Payments on surrenders 0.00 0.00Claim expenses-net 0.00 0.00
Provision for insurance contract reserve-net 0.00 0.00
Policyholder dividends 0.00 0.00
Reinsurance expenses 0.00 0.00
Business taxes and surcharges 190,082.69 12,426.94 1,225,233.28 456,284.08
Selling expenses 15,638,039.67 11,168,033.90 15,145,653.28 12,651,387.79
Administrative expenses 20,713,947.28 15,008,968.04 27,284,640.88 18,625,465.88
Financial expenses 9,490,417.98 8,028,633.71 7,969,488.58 8,161,319.07
Impairment loss -1,023,321.83 8,618,793.02 -126,553.20
Add: gain/loss from changes in fair value (“-”
for loss)
-254,028.41 -254,028.41
Gain/loss from investment (“-” for loss) 14,425,386.25 -11,673,119.32
Including: investment gain from
associates and joint ventures
0.00 0.00
Gain/loss from foreign exchange difference
(“-” for loss)
0.00 0.00
3. Operation profit (“-” for loss) 4,844,473.50 2,123,962.42 -5,898,088.20 -30,724,937.93
Add: non-operating incomes 326,473.30 43,138.00 2,729,661.78 13,303.80
Less: non-operating expenses 356,554.62 11,685.00 380,900.92 84,253.99
Including: loss from disposal of non-current
assets
0.00 0.00
4. Total profit (“-” for total loss) 4,814,392.18 2,155,415.42 -3,549,327.34 -30,795,888.12
Less: income tax expenses 1,145,438.49 538,853.85 -4,689,403.16 -7,820,847.03
5. Net profit (“-” for total loss) 3,668,953.69 1,616,561.57 1,140,075.82 -22,975,041.09
Attributable to owners of parent company 3,613,543.38 1,616,561.57 1,947,346.35 -22,975,041.09
Minority interest 55,410.31 -807,270.53 0.00
6. Earnings per share
(1) Basic EPS 0.0061 0.0033 0.00
(2) Diluted EPS 0.0061 0.0033 0.00
7. Other composite income 0.00 0.00
8. Total composite income 3,668,953.69 1,616,561.57 1,140,075.82 -22,975,041.09
Attributable to owners of parent company 3,613,543.38 1,616,561.57 1,947,346.35 -22,975,041.09
Attributable to minority shareholders 55,410.31 -807,270.53 0.00
4.3 Income statement as of the period from year-begin to the end of report period
Prepared by Hubei Sanonda Co., Ltd. Jan.-Sep. 2010 Unit: RMB YuanThis report period Same period of last year
Items
Consolidation Parent company Consolidation Parent company
1. Total operation revenue 1,193,813,565.71 893,250,200.22 1,376,753,861.18 970,837,313.75
Including: sales revenue 1,193,813,565.71 893,250,200.22 1,376,753,861.18 970,837,313.75
Interest income
Premium income
Fee and commission income
2. Total operation cost 1,168,319,725.78 872,959,607.26 1,341,786,603.22 941,766,488.34
Including: cost of sales 1,028,061,805.10 772,977,391.93 1,161,832,163.33 822,220,315.65
Interest expenses
Service charges and commission expenses
Payments on surrenders
Claim expenses-net
Provision for insurance contract reserve-net
Policyholder dividends
Reinsurance expenses
Business taxes and surcharges 1,334,547.69 725,629.33 1,726,137.33 472,052.11
Selling expenses 42,285,757.77 27,450,949.99 54,487,576.60 36,142,778.53
Administrative expenses 53,240,481.60 33,627,906.87 74,024,523.21 46,819,724.10
Financial expenses 33,981,044.80 31,339,638.02 35,507,374.19 33,497,929.86
Impairment loss 9,416,088.82 6,838,091.12 14,208,828.56 2,613,688.09
Add: gain/loss from changes in fair value (“-”
for loss)
1,942,627.91 1,942,627.91
Gain/loss from investment (“-” for loss) 3,275,227.72 15,865,386.25 158,578.79
Including: investment gain from
associates and joint ventures
Gain/loss from foreign exchange difference
(“-” for loss)
3. Operation profit (“-” for loss) 25,493,839.93 23,565,820.68 52,775,272.12 31,172,032.11
Add: non-operating incomes 1,172,872.00 470,540.03 5,389,464.85 116,533.14
Less: non-operating expenses 930,860.68 41,890.25 1,416,456.25 947,887.52
Including: loss from disposal of non-current
assets
4. Total profit (“-” for total loss) 25,735,851.25 23,994,470.46 56,748,280.72 30,340,677.73
Less: income tax expenses 10,135,025.56 7,568,739.14 10,384,482.69 4,865,369.915. Net profit (“-” for total loss) 15,600,825.69 16,425,731.32 46,363,798.03 25,475,307.82
Attributable to owners of parent company 16,023,240.46 16,425,731.32 46,071,965.93 25,475,307.82
Minority interest -422,414.77 0.00 291,832.10
6. Earnings per share
(1) Basic EPS 0.0270 0.0776
(2) Diluted EPS 0.0270 0.0776
7. Other composite income 0.00 0.00
8. Total composite income 15,600,825.69 16,425,731.32 46,363,798.03 25,475,307.82
Attributable to owners of parent company 16,023,240.46 16,425,731.32 46,071,965.93 25,475,307.82
Attributable to minority shareholders -422,414.77 0.00 291,832.10 0.00
4.4 Cash flow statement as of the period from year-begin to the end of report period
Prepared by Hubei Sanonda Co., Ltd. Jan.-Sep. 2010 Unit: RMB Yuan
This report period Same period of last year
Items
Consolidation Parent company Consolidation Parent company
1. Cash flows from operating activities
Cash received from sales of goods or rending
of services
981,222,159.69 719,759,220.81 1,163,928,486.23 902,798,596.64
Net increase of deposits received from and
held for customers
Net increase of borrowings from central bank
Net increase of inter-bank loans from other
financial institutions
Cash received against original insurance
contract
Net Cash received from reinsurance
Net increase of client deposits and
investments
Net increase in disposal of held-for-trading
financial assets
Interests, handling charges and commission
received
Net increase of inter-bank funds received
Net increase of cash received under
repurchasing
Tax and fare refunded 34,764,433.34 27,913,224.94 13,185,559.35 8,308,471.59Other cash received from operating activities 43,593,526.36 16,729,892.70 46,105,093.37 43,687,149.29
Sub-total of cash inflow from operating
activities
1,059,580,119.39 764,402,338.45 1,223,219,138.95 954,794,217.52
Cash paid for goods and services 926,342,793.52 711,652,585.33 902,689,734.92 667,473,233.39
Net increase of loans and advances
Net increase of deposits in central bank, banks
and other financial institutions
Cash paid for original contract claim
Cash paid for interests, fees and commissions
Cash paid for policy dividends
Cash paid to and for employees 73,359,658.47 58,501,802.78 80,078,807.71 52,583,445.30
Taxes and fares paid 21,421,077.03 14,018,583.30 80,025,775.49 64,319,446.28
Other cash paid relating to operating activities 101,644,216.45 52,650,011.32 97,530,909.32 66,409,161.10
Sub-total of cash outflows from operating
activities
1,122,767,745.47 836,822,982.73 1,160,325,227.44 850,785,286.07
Net cash flow from operating activities -63,187,626.08 -72,420,644.28 62,893,911.51 104,008,931.45
2. Cash flows from investing activities
Cash received from return of investments 3,036,457.50 3,036,457.50
Cash received from investment income 885,500.00
Net cash received from disposal of fixed
assets, intangible assets and other long-term assets
116,800.87 68,984.87 3,569,562.00 55,721.00
Net cash received from disposal of
subsidiaries and other operating units
10,000,000.00 10,000,000.00 6,111,428.39 6,111,428.39
Other cash received relating to investing
activities
238,473.04 238,473.04 120,168.76 87,561.13
Sub-total of cash inflows of investing
activities
10,355,273.91 10,307,457.91 12,837,616.65 10,176,668.02
Cash paid for acquiring fixed assets,
intangible assets and other long-term assets
193,621,016.68 175,973,523.11 298,077,154.59 277,187,930.17
Cash paid for acquiring investments 15,600,000.00
Net increase of pledge loans
Net cash paid for acquisition of subsidiaries
and other operating units
Other cash paid relating to investing activities 318,396.94 318,396.94 1,673,183.07 1,462,536.37
Sub-total of cash outflows of investing
activities
193,939,413.62 176,291,920.05 299,750,337.66 294,250,466.54Net cash flow from investing activities -183,584,139.71 -165,984,462.14 -286,912,721.01 -284,073,798.52
3. Cash flows of financing activities
Cash received from absorbing investments 4,900,000.00
Including: Cash received from minority
shareholders of subsidiaries
4,900,000.00
Cash received from borrowings 507,474,801.94 410,000,000.00 715,752,278.26 585,000,000.00
Cash received from bonds issuing
Other cash received relating to financing
activities
4,664,022.65 4,133,978.31 7,107,221.37 6,330,554.85
Sub-total of cash inflows of financing
activities
512,138,824.59 414,133,978.31 727,759,499.63 591,330,554.85
Cash paid for settling debts 247,834,030.84 193,000,000.00 353,308,789.08 243,000,000.00
Cash paid for distribution of dividends or
profits or reimbursing interest
36,966,801.99 34,858,790.57 64,980,922.40 59,091,366.20
Including: dividends or profits paid to
minority shareholders by subsidiaries
1,154,633.12
Other cash paid relating to financing activities 8,018,314.40 6,801,292.90 7,095,902.61 5,921,176.58
Sub-total of cash outflows of financing
activities
292,819,147.23 234,660,083.47 425,385,614.09 308,012,542.78
Net cash flows of financing activities 219,319,677.36 179,473,894.84 302,373,885.54 283,318,012.07
4. Effect of foreign exchange rate changes
5. Net increase of cash and cash equivalents -27,452,088.43 -58,931,211.58 78,355,076.04 103,253,145.00
Add: cash and cash equivalents at the
beginning of this period
474,460,623.29 424,584,953.40 562,832,319.76 490,154,426.30
6. Cash and cash equivalents at period-end 447,008,534.86 365,653,741.82 641,187,395.80 593,407,571.30
4.5 Auditor’s report
Audit opinion: Unaudited
Chairman of the Board: Li Zuorong
Hubei Sanonda Co., Ltd.
21 Oct. 2010
