2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
HUBEI SANONDA CO., LTD.
2013 Semi-annual Report
August 2013
1
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
I. Important Reminders, Contents & Explanation
The Board of Directors, the Supervisory Committee as well as all directors, supervisors and senior
management staff of Hubei Sanonda Co., Ltd. (hereinafter referred to as “the Company”) warrant
that this report is factual, accurate and complete without any false record, misleading statement or
material omission. And they shall be jointly and severally liable for that.
All directors attended the board session for reviewing this report.
The Company plans not to distribute cash dividends or bonus shares or turn capital reserve into
share capital.
Mr. Li Zuorong, company principal, and Mr. He Xuesong, chief of the accounting work and chief of
the accounting organ (chief of accounting), hereby confirm that the Financial Report enclosed in
this report is factual, accurate and complete.
This report is prepared in both Chinese and English. Should there be any discrepancy between the
two versions, the Chinese version shall prevail.
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Contents
I. Important Reminders, Contents & Explanation ......................................................... 2
II. Company Profile ....................................................................................................... 5
III. Accouonting & Business Highlights ....................................................................... 7
IV. Report of the Board of Directors ............................................................................. 9
V. Significant Events ................................................................................................... 13
VI. Change in Shares & Shareholders ......................................................................... 19
VII. Directors, Supervisors & Senior Management Staff ........................................... 22
VIII. Financial Report ................................................................................................. 24
IX. Documents Available for Reference.................................................................... 117
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Explanation
Refers
Term Contents
to
Company/the Company Refers Hubei Sanonda Co., Ltd.
to
Refers
CSRC China Securities Regulatory Commission
to
Refers
SZSE Shenzhen Stock Exchange
to
Refers
Reporting period/the reporting period 1 Jan. 2013-30 Jun. 2013
to
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
II. Company Profile
I. Basic information of the Company
Stock abbreviation SLDA (SLDB) Stock code 000553（200553）
Stock exchange listed with Shenzhen Stock Exchange
Chinese name of the Company 湖北沙隆达股份有限公司
Abbr. of the Chinese name of
沙隆达
the Company (if any)
English name of the Company
HuBei Sanonda co., Ltd.
(if any)
Abbr. of the English name of
Sanonda
the Company (if any)
Legal representative of the
Li Zuorong
Company
II. For Contact
Company Secretary Securities Affairs Representative
Name Li Zhongxi Liang Jiqin
No. 93, Beijing East Road, Jingzhou, No. 93, Beijing East Road, Jingzhou,
Contact address
Hubei Hubei
Tel. 0716-8208632 0716-8208232
Fax 0716-8321099 0716-8321099
E-mail li_zhongxi@263.net freefly2006@263.net
III. Other information
1. Ways to contact the Company
Did any change occur to the registered address, office address and their postal codes, website address and email address of the
Company during the reporting period?
□ Applicable √ Inapplicable
The registered address, office address and their postal codes, website address and email address of the Company did not change
during the reporting period. The said information can be found in the 2012 Annual Report.
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
2. About information disclosure and where this report is placed
Did any change occur to information disclosure media and where this report is placed during the reporting period?
□ Applicable √ Inapplicable
The newspapers designated by the Company for information disclosure, the website designated by CSRC for disclosing this report
and the location where this report is placed did not change during the reporting period. The said information can be found in the 2012
Annual Report.
3. Change of the registered information
Did any change occur to the registered information during the reporting period?
□ Applicable √ Inapplicable
The registration date and place of the Company, its business license No., taxation registration No. and organizational code did not
change during the reporting period. The said information can be found in the 2012 Annual Report.
4. Other relevant information
Did any change occur to other relevant information during the reporting period?
□ Applicable √ Inapplicable
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
III. Accounting & Business Highlights
I. Major accounting data and financial indicators
Does the Company adjust retrospectively or restate accounting data of previous years due to change of the accounting policy or
correction of any accounting error?
□ Yes √ No
Reporting period Same period of last year YoY +/-（％）
Operating revenues (RMB Yuan) 1,519,688,317.22 1,116,755,277.07 36.08%
Net profit attributable to shareholders of
127,470,524.25 23,986,378.19 431.43%
the Company (RMB Yuan)
Net profit attributable to shareholders of
the Company after extraordinary gains and 128,673,087.74 23,972,136.64 436.76%
losses (RMB Yuan)
Net cash flows from operating activities
422,153,123.84 132,227,529.17 219.26%
(RMB Yuan)
Basic EPS (RMB Yuan/share) 0.2146 0.0404 431.19%
Diluted EPS (RMB Yuan/share) 0.2146 0.0404 431.19%
Weighted average ROE (%) 9.66% 2.05% 7.61%
As at the end of the
As at the end of last year YoY +/-（％）
reporting period
Total assets (RMB Yuan) 2,857,566,925.25 2,405,494,385.09 18.79%
Net assets attributable to shareholders of
1,350,626,822.89 1,255,536,761.52 7.57%
the Company (RMB Yuan)
II. Differences between accounting data under domestic and overseas accounting standards
1. Differences of net profit and net assets disclosed in financial reports prepared under international and
Chinese accounting standards
Unit: RMB Yuan
Net profit attributable to shareholders of the Net assets attributable to shareholders of the
Company Company
Reporting period Same period of last year Closing amount Opening amount
According to Chinese
127,470,524.25 23,986,378.19 1,350,626,822.89 1,255,536,761.52
accounting standards
Items and amounts adjusted according to international accounting standards
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
2. Differences of net profit and net assets disclosed in financial reports prepared under overseas and
Chinese accounting standards
Unit: RMB Yuan
Net profit attributable to shareholders of the Net assets attributable to shareholders of the
Company Company
Reporting period Same period of last year Closing amount Opening amount
According to Chinese
127,470,524.25 23,986,378.19 1,350,626,822.89 1,255,536,761.52
accounting standards
Items and amounts adjusted according to overseas accounting standards
3. Explain reasons for the differences between accounting data under domestic and overseas accounting
standards
III. Items and amounts of extraordinary gains and losses
Unit: RMB Yuan
Item Amount Explanation
Gains/losses on the disposal of non-current assets (including the
-585,412.68
offset part of asset impairment provisions)
Government grants recognized in the current period, except for
those acquired in the ordinary course of business or granted at
1,142,978.13
certain quotas or amounts according to the country’s unified
standards
Gain/loss on debt restructuring -152,001.61
Other non-operating income and expenses other than the above -1,971,021.99
Less: Income tax effects -391,364.54
Minority interests effects (after tax) 28,469.88
Total -1,202,563.49 --
Explain the reasons if the Company classifies an item as an extraordinary gain/loss according to the definition in the Explanatory
Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Extraordinary Gains and
Losses, or classifies any extraordinary gain/loss item mentioned in the said explanatory announcement as a recurrent gain/loss item
□ Applicable √ Inapplicable
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
IV. Report of the Board of Directors
I. Overview
In the first half of 2013, the pesticide market was in a cyclic recovery. Meanwhile, due to the fact that the government reinforced
environmental protection, some domestic pesticide enterprises had to operate at low capacity, with a decreased output. The Company
proactively dealt with the situation, seized opportunities, overcame difficulties and adjusted in time the production and operation
strategies. Meanwhile, it worked on production, promoted sales, enhanced production organization and management and promoted
improvement of the systems such as SHE, 5S, TPM and TQM. As a result, the main production devices worked stably at full
capacity and many economic indicators registered fast growth and record highs.
For the reporting period, the Company achieved operating revenues of RMB 1.52 billion, up 36.08% over the same period of last
year, including an export income of USD 128 million, representing a year-on-year growth of 34.28%; operating profit of RMB
172.21 million, up 376.59% from the same period of last year; and net profit attributable to owners of the Company of RMB 127.47
million, representing a year-on-year increase of 431.43%. The output of chemical pesticide (100% consistency) reached 33,200 tons,
increasing 58.79% when compared with the same period of last year. The considerable growth in profit was mainly because the
production and sales volume of the Company’s main products increased considerably from the same period of last year and the sales
prices were also on the rise.
II. Main business analysis
Overview
For the reporting period, the Company achieved operating revenues of RMB 1.52 billion, up 36.08% over the same period of last
year, which was mainly because the production and sales volume of the Company’s main products increased considerably from the
same period of last year and the sales prices were also on the rise.
YoY change of major financial data:
Unit: RMB Yuan
Reporting period Same period of last year YoY +/-% Main reasons for change
The production and sales
volume of the
Company’s main
products increased
Operating revenues 1,519,688,317.22 1,116,755,277.07 36.08%
considerably from the
same period of last year
and the sales prices were
also on the rise.
Operating revenues
Operating costs 1,210,871,838.98 956,561,172.05 26.59%
increased.
Operating revenues
Selling expenses 45,575,412.03 35,678,208.25 27.74%
increased and the
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
corresponding
transportation expenses
increased.
Administrative expenses 46,726,703.36 43,183,369.31 8.21%
Financial expenses 40,211,554.98 31,996,393.97 25.68% Exchange loss increased.
Income tax expenses 43,970,999.05 11,671,651.36 276.73% Total profit increased.
Net cash flows from Cash inflows from sales
422,153,123.84 132,227,529.17 219.26%
operating activities increased.
Net cash flows from
-62,633,549.10 -69,175,944.42 9.46%
investing activities
Dividend payments and
Net cash flows from
16,044,392.26 108,818,764.24 -85.26% loan repayments
financing activities
increased.
Net cash flows from
Net increase in cash and
374,541,119.91 171,987,974.01 117.77% operating activities
cash equivalents
increased.
Major changes to the profit structure or sources of the Company during the reporting period:
□ Applicable √ Inapplicable
No major changes occurred to the profit structure or sources of the Company during the reporting period.
Reporting period progress of the future development planning in the disclosed documents of the Company such as share-soliciting
prospectuses, offering prospectuses, asset reorganization reports, etc.:
□ Applicable √ Inapplicable
The Company did not mention any future planning for the reporting period in its disclosed documents such as share-soliciting
prospectuses, offering prospectuses, asset reorganization reports, etc.
Review the progress of the previously disclosed business plan in the reporting period:
As disclosed in the 2012 Annual Report, the Company planned to achieve sales revenues of RMB 2.5 billion for 2013. In the first
half of 2013, the Company achieved operating revenues of RMB 1.52 billion, accomplishing 60.8% of the annual target. In the
coming six months, the Company will try its best to organize production carefully to ensure all production devices operate safely and
stably and the sales demand is fully satisfied. It will keep improving management to increase the operation quality. It will also pay
close attention to the market, enhance marketing innovation, solve sales bottlenecks and improve sales management. At the same
time, it will carry forward technical innovation and accelerate projects to reach production objectives so that the annual production
and operation plan can be accomplished.
III. Breakdown of main business
Unit: RMB Yuan
Increase/decrease Increase/decrease Increase/decrease
of operating of operating costs of gross profit
Operating Gross profit rate
Operating costs revenues over the over the same rate over the same
revenues (%)
same period of period of last year period of last year
last year (%) (%) (%)
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Classified by industry:
Industry of
manufacturing
chemical raw
1,506,296,510.91 1,204,175,172.89 20.06% 39.06% 29.74% 5.75%
materials and
chemical
products
Classified by product:
Agriculture-appli
ed chemicals,
1,557,457,099.01 1,267,811,661.55 18.6% 37.08% 27.41% 6.18%
such as fertilizer
and pesticide
New chemical
materials and 8,363,760.70 4,721,396.56 43.55% 0.88% 10.92% -5.11%
special chemicals
Petroleum
chemical and 60,572,466.92 52,578,482.51 13.2% 4.56% 8.97% -3.51%
refining products
Basic
(chlor-alkali)
8,067,409.36 7,227,857.35 10.41% 138.58% 127.11% 4.53%
chemical
products
Internal offset
-128,164,225.08 -128,164,225.08
amount
Classified by region:
Domestic 851,193,234.06 677,842,526.40 20.37% 34.22% 26.63% 4.77%
Overseas 783,267,501.93 654,496,871.57 16.44% 37.04% 26.98% 6.62%
Internal offset
-128,164,225.08 -128,164,225.08
amount
IV. Core competitiveness analysis
The Company is mainly engaged in production and sale of pesticides and other chemicals, which belongs to a traditional industry
with full competition. In recent years, the Company has been sticking to technological improvement, reducing consumption of energy
and materials and increasing the product quality and yield. Meanwhile, it keeps improving the safety & environmental protection,
on-site, equipment and quality management systems to increase the production and management capability. It also enhances market
expansion, strengthens market management and keeps improving the marketing network. As a result, the market shares of its major
products expand steadily. At the same time, it accelerates projects and keeps improving the product strucutre, which is rewarded by
greater scale effects. In particular, the smooth operation of the thermoelectricity co-production project further enhances the overall
product supporting capability of the Company. No important change occurred to the core competitiveness of the Company during the
reporting period.
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
V. Investment analysis
1. Investments in equities of external parties
（1）Equity-holdings in financial enterprises
Gain/loss
Initial Opening Opening Closing Closing Closing in the
Enterprise Enterprise investment equity-hol equity-hol equity-hol equity-hol book value reporting Accountin Equity
name variety cost (RMB dings ding ratio dings ding ratio (RMB period g title source
Yuan) (share) (%) (share) (%) Yuan) (RMB
Yuan)
Purchase
Long-term
Hubei Commerci 20,000,000 8,008,982. 2,254,182. of
20,000,000 1.18% 20,000,000 1.18% equity
Bank al bank .00 63 43 corporate
investment
stock
20,000,000 8,008,982. 2,254,182.
Total 20,000,000 -- 20,000,000 -- -- --
.00 63 43
2. Analysis to main subsidiaries and stock-participating companies
Main subsidiaries and stock-participating companies:
Unit: RMB Yuan
Main
Company Company Registered Operating Operating
Industry products/ser Total assets Net assets Net profit
name variety capital revenues profit
vices
Chemical
Sanonda
raw Production
(Jingzhou)
material and of pesticides
Pesticides 6,723,316.3 2,181,759.9 15,953,584. -1,407,266. -1,025,179.
Subsidiary chemical and 30 million
and 9 1 31 71 08
product intermediate
Chemicals
manufacturi s
Co., Ltd.
ng industry
Import &
Hubei
export of
Sanonda
Trade pesticides 317,372,559 27,818,246. 108,779,940 2,469,288.5 1,830,677.2
Foreign Subsidiary 10 million
industry and .49 50 .37 3 5
Trading
intermediate
Co., Ltd.
s
Hubei Chemical Production
18,387,004. 18,390,773.
Sanonda Subsidiary raw and sales of 30 million -428,956.33 -870,846.50
42 40
Tianmen material and pesticides
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Agrochemic chemical
al Co., Ltd. product
manufacturi
ng industry
Chemical
raw
Jingzhou Production
material and
Longhua and sales of 40,778,768. 12,774,807. 63,633,716. -2,672,995. -2,330,431.
Subsidiary chemical 5 million
Petrochemic chemical 23 17 79 22 34
product
al Co., Ltd. products
manufacturi
ng industry
Chemical
raw Production
Jingzhou
material and and sale of
Hongxiang 188,118,968 22,162,268. 6,457,386.7 -3,895,755. -3,895,755.
Subsidiary chemical chemical 40 million
Chemical .05 02 9 08 08
product raw
Co., Ltd.
manufacturi materials
ng industry
3. Significant projects of investments with non-raised funds
Unit: RMB Ten thousand
Cumulative actual
Total planned Input for the
Project name input as at the Project progress Project earnings
investment reporting period
period-end
Salt mine sand salt
2,300 972 2,332 100% As expected
9#-platform 10 well
10,000 tons/year
pyridine and 16,130 612 11,717 99% Unfinished
derivatives
200,000-ton
ion-exchange
71,099 812 812 1.14% Unfinished
membrane caustic
soda (Phase I)
Total 89,529 2,396 14,861 -- --
VI. Predict the operating results of Jan.-Sept. 2013
Warning of possible loss or considerable YoY change of the accumulated net profit made during the period-begin to the end of the
next reporting period according to prediction, as well as explanations on the reasons:
□ Applicable √ Inapplicable
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
VII. Implementation of profit allocation during the reporting period
Profit allocation plan implemented during the reporting period, especially execution and adjustment of the cash dividend plan and the
plan for turning capital reserve into share capital:
√ Applicable □ Inapplicable
On 9 Apr. 2013, the “Profit Allocation Plan of the Company for 2012” was reviewed and approved at the 2012 Annual Shareholders’
General Meeting. According to the Plan, based on the total 593,923,220 shares of the Company as at 31 Dec. 2012, the Company
distributed a cash dividend of RMB 0.5 (tax included) for every 10 shares held by its shareholders; and there was no turning of
capital reserve into share capital. The announcement on implementation of the equity distribution for 2012 (No. 2013-28) was
disclosed on Securities Times, China Securities Journal, Ta Kung Pao (HK) and http://www.cninfo.com.cn on 1 Jun. 2013.
VIII. Particulars about researches, visits and interviews received in this reporting period
Main discussion and
Time of reception Place of reception Way of reception Visitor type Visitor materials provided by the
Company
1. Main discussion: routine
production and operation of
the Company.
SWS Research Co.,
7 Apr. 2013 Jingzhou Field research Institution 2. Materials provided by
Ltd.
the Company: disclosed
information such as
periodic reports
1. Main discussion: routine
production and operation of
China International the Company.
15 May 2013 Jingzhou Field research Institution Fund Management 2. Materials provided by
Co., Ltd. the Company: disclosed
information such as
periodic reports
V. Significant Events
I. Corporate governance
During the reporting period, the company continues to revise constantly, improve the internal management system and standardize
operations according to the Company Law and the China securities regulatory commission related regulations and requirements
issued by the Shenzhen stock exchange and other regulators. On March 13, 2013, the company held the 18th session of the sixth
session of the board of directors meeting; participants deliberate and approve The Company Related Transaction Management System;
on 17 April, 2013, the sixth session of the board of directors meeting; participants deliberate and approve The Management System of
14
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Company Director Supervisors Executives Shareholding and Changes.; On May 25,the 20session of the sixth session of the board of
directors meeting examined and approved The Revise of Company Directors and Senior Management Remuneration and Appraisal
Scheme.
The actual situation of the Company’s governance did not differ in principle from the Company Law and the relevant CSRC
requirements.
II. Significant Litigations and Arbitrations
□ Applicable √ Inapplicable
The company was not involved in any significant lawsuit or arbitration in this year.
III. Media query
□Applicable √Inapplicable
The company was not involved in any media query in this year.
IV. Bankruptcy or Reorganization Events
No
V. Transaction in Assets
1. Purchase of assets
Relationsh
Ratio of
ip between
the net
the
profit
transaction
Transacti contribut
Transacti Related party and
on Impact to the ed by the
on party Assets Progress Impact to the -party the
price(R company’s asset to Disclosure Disclosure
or purchase （note company（note transact Company
MB ten profit or loss the date(note 5) index
control d 2） 3） ion or (applicable
thousand （note 4） Compan
party not for
Yuan) y to the
related-par
total
ty
profit
transaction
(%)
s)
10% Apply to Disclosure
equity of the in China
Sanonda Shenzhen Securities
Sanonda
(jingzhou stock Journal,
Group
) 590.67 Yes exchange 5 July, 2013 securities
Corporati
pesticide listing times, Ta
on
chemical rules of Kung Pao
co., LTD paragraph and
and 1 of article www.cninfo.
15
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
10%f 10.1.3 com.
Hubei stock NO.2013-32
Sanonda
foreign
trade co.,
LTD
2. Sale of assets
Inapplicable
3. Business combination
Inapplicable
VI. Implementation and Influence of Equity Incentive Plan of the Company
Inapplicable
There is no implementation equity incentive plan in the company during the reporting period.
VII. Significant Related-party Transaction
1. Related-party transactions relevant to routine operation
Pricing Settlemen
Type of Content Transacti
principle Proportio t method
the of the on
of the n in same of the
Related Relations related-pa related-pa Transacti amount Market Disclosur Disclosur
related-pa kind of related-pa
party hip rty rty on price (ten price e date e index
rty transactio rty
transactio transactio thousand
transactio ns (%) transactio
n n yuan)
n n
Sanonda
Cash
Group Parent Raw Market
Purchase 228.2 0.19% remittanc
Corporati company material price
e
on
Hubei Associate
Jingzhou d
Low Cash
Huaxiang enterprise Market
Purchase consumpt 106.82 0.09% remittanc
Chemical s of price
ion goods e
s Co., parent
Ltd. company
Sanonda Parent Raw Market Cash
Sale 213.14 0.14%
Group company material price remittanc
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Corporati e
on
Jiangsu
Under
Anpon Cash
the same Market
Electroch Sale Pesticides 251.33 0.17% remittanc
ultimate price
emical e
controller
Co., Ltd
Hubei Associate
Jingzhou d Momentu
Cash
Huaxiang enterprise m Market
Sale 455.59 0.3% remittanc
Chemical s of chemical price
e
s Co., parent product
Ltd. company
Jiamusi
Under
Heilong Cash
the same Market
Agroche Sale Pesticides 443.5 0.29% remittanc
ultimate price
micals e
controller
Co., Ltd.
Shandong
Dacheng Under
Cash
Agroche the same Market
Sale Pesticides 244.42 0.16% remittanc
mical ultimate price
e
Corporat controller
ion
Makhtesh
Under
im Cash
the same Market
Chemical Sale Pesticides 879.78 0.58% remittanc
ultimate price
Works e
controller
Ltd.
Total -- -- 2,822.78 -- -- -- -- --
As for the prediction on the total amount of
Daily management transactions this year is expected to 77 million Yuan; 28.2278
routine related-party transactions to be
million Yuan is the actual prediction which is 36.66% of the year‘s prediction during
occurred in the reporting period by
the reporting period.
relevant types, the actual performance in
the reporting period
The company’s related transactions with related party shall be carried out in
Reason for significant difference between accordance with the principle of voluntary, equality and mutual benefit, fair, and will
the transaction price and the market price not harm the interests of the company
2. Related-party transactions regarding purchase and sales of assets
Related Relations Type of Content Pricing Book Assessed Market Transfer Settleme Transacti Disclosu Disclosu
17
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
party hip the of the principle value of value of fair price nt on profit re date re index
related-p related-p of the the transferr value (RMB method or
arty arty related-p transferr ed assets (RMB Ten of the loss(RM
transacti transacti arty ed assets (RMB Ten Thousan related-p B Ten
on on transacti (RMB Ten Thousan d) arty Thousan
on Ten Thousan d) transacti d)
Thousan d)） on
d)
Disclosu
re in
China
10% Securitie
equity of s
Sanonda Jingzhou Journal,
Cash 5
Group Parent Huaxian Market securitie
Purchase 50.75 291.37 291.37 remittan July,201
Corporat company g price s times,
ce 3
ion Chemica Ta Kung
ls Co., Pao and
Ltd www.cni
nfo.com.
NO.2013
-32
Disclosu
re in
China
Securitie
10% s
Sanonda equity of Journal,
Cash 5
Group Parent Sanonda Market securitie
Purchase 246.5 299.3 299.3 remittan July,201
Corporat company foreign price s times,
ce 3
ion trade co., Ta Kung
LTD Pao and
www.cni
nfo.com.
NO.2013
-32
The reasons of the differences between
Appreciation of land evaluation
transfer price and book value
Impacts on the company’s operating The transaction did not affect the range of consolidate statements of the company, and has
results and financial condition no significant impact on the company’s financial status and operating results.
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
3. Significant related-party transitions with joint investments
No
4. Significant credits and liabilities with related parties
Was there any non-operating credit or liability with any related party?
□ Yes √No
5. Other significant related-party transactions
Content of this period Last period
Type of the
Name of the the
Type related-party Proportion Proportion
company related-party Amount Amount
transaction (%) (%)
transaction
Sanonda Guarantee Guarantee fee Negotiated 2,880,000.00 32.43 3,,600,000.00 57.48
Group price
Corporation
China Guarantee Guarantee fee Negotiated 6,000,000.00 67.57 2,700,000.00 42.52
national price
chemical
agrochemical
corporation
Jingzhou Loan Loan Bank rate 11,000,000.00 100 10,000,000.00 100
Huaxiang
Chemicals
Co., Ltd.
Related inquiries of website for disclosure of provisional report of significant related-party
transaction
Disclosure date of provisional Name of website for disclosure of provisional
Name of provisional report
report report
Related transaction announcement of
insurance pay to the controlling shareholder China Securities Journal, securities times, Ta
15 Mar, 2013
and related parties No.2013-12 Kung Pao and www.cninfo.com
VIII Significant contracts and execution
1. Particulars about trusteeship, contract and lease
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
(1) Status of trust
Notes on status of trust
□Applicable √Inapplicable
Projects whose profits reach more than 10% of the total profits of the company during the reporting period.
□Applicable √Inapplicable
(2) Contract
Notes about contracting
□Applicable √Inapplicable
Projects whose profits reach more than 10% of the total profits of the company during the reporting period.
□Applicable √Inapplicable
(3) Particulars about leasing
Notes about leasing
During the reporting period, the seventh floor of the company’s office building is leased by Sanonda Group Corporation to use it as
their own office with an annual rent of 120,000 yuan.
Projects whose profits reach more than 10% of the total profits of the company in the reporting period.
□ Applicable √ Inapplicable
2. Guarantees provided by the company
Unit: ten thousand yuan
Guarantees provided by the company for external parties (excluding those for subsidiaries)
Disclosure
date on Guarante
Actual
relevant Actual e for a
Amount for occurrence date Type of Period of Executed
Guaranteed party announcem guarantee related
guarantee (date of guarantee guarantee or not
ent of amount party or
agreement)
guaranteed not
amount
Guarantees provided by the company for its subsidiaries
Disclosure Actual Guarante
Actual
date on Amount for occurrence date Type of Period of Executed e for a
Guaranteed party guarantee
relevant guarantee (date of guarantee guarantee or not related
amount
announcem agreement) party or
20
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
ent of not
guaranteed
amount
Hubei Sanonda
Foreign Trading Co., 15 Mar, Joint liability
35,780 14Mar, 2013 35,780 1 year No No
Ltd. 2013 guarantee
Total guarantee line approved for Total actual occurred amount
the subsidiaries during the of guarantee for the
35,780 35,780
reporting period subsidiaries during the
(B1) reporting period (B2)
Total guarantee line that has been
Total actual guarantee balance
approved for the subsidiaries at
35,780 for the subsidiaries at the end 35,780
the end of the reporting period
of the reporting period (B4)
(B3)
Total guarantee amount provided by the company (total of the above-mentioned two kinds of guarantees)
Total guarantee line approved Total actual occurred amount
during the reporting period 35,780 of guarantee during the 35,780
(A1+B1) reporting period (A2+B2)
Total guarantee line that has been
Total actual guarantee balance
approved at the end of the
35,780 at the end of the reporting 35,780
reporting period
period (A4+B4)
(A3+B3)
Proportion of total guarantee amount (A4+B4) to the net assets
26.49%
of the Company
Of which:
Amount of guarantee for shareholders, actual controller and
0
related parties (C)
Amount of debt guarantee provided for the guaranteed party
whose asset-liability ratio is not less than 70% directly or 35,780
indirectly (D)
Total amount of the above three guarantees (C+D+E) 35,780
Explanation on guarantee that adopts complex method
3. Other significant contracts
No
4. Other significant transaction
No
IX. Particulars about Engagement and Disengagement of CPA Firm
21
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Has this semi-annual report been audited?
□ Yes √ No
XI. Particulars about punishment and rectification
□ Yes √ No
Explaination on rectification
□Applicable √Inapplicable
XII. Explanation on other significant events
Expired on 11 Jan, 2013, the company ended the guarantee for Guangxi Hechi chemical co., LTD the details are announced on China
Securities Journal, securities times, Ta Kung Pao and www.cninfo.com.
22
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
VI. Change in Share Capital and Particulars about Shareholders
I. Particulars about the changes in share capital
Before the change Increase/decrease in the change (+,-) After the change
Capitalizat
Issuance ion of
Bonus Proportio
Number Proportion of new public Other Subtotal Number
shares n
shares reserve
fund
I. Shares subject to trading
34,230 0.01% 12,720 12,720 46,950 0.01%
moratorium
5. Shares held by senior
34,230 0.01% 12,720 12,720 46,950 0.01%
management staff
II. Shares not subject to 593,888,9 593,876,2
99.99% -12,720 -12,720 99.99%
trading moratorium 90 70
1. Ordinary shares 363,888,9 363,880,3
61.27% -8,620 -8,620 61.27%
denominated in RMB 90 70
2. Domestically listed 230,000,0 229,995,9
38.73% -4,100 -4,100 38.73%
foreign shares 00 00
593,923,2 593,923,2
III. Total shares 100% 100%
20 20
Reasons for changes in share
√Applicable □Inapplicable
Trading moratorium condition of 4880 shares subject to trading moratorium held by Mr. Deng Guobin previous director and vice
general manager of the company was cancelled after the expiration of half year of his resignation. Trading moratorium condition of
15000 shares subject to trading moratorium held by Mr. Wu Hairong was cancelled after resigning from his supervisor position for
six month. the new employment LiuZhiMing, assistant general manager holds 28500 shares of the company, the supervisors liujun
increases his B shares by 4100 shares.
Approval of share changes
□ Applicable √ Inapplicable
Transfers in share changes
Influence of share changes towards financial indexes in the latest year and latest period such as basic EPS and diluted EPS, and net
assets per share belonging to shareholder with ordinary share
□ Applicable √ Inapplicable
Other contents that the Company thinks necessary or is asked by securities regulators to be disclosed
□ Applicable √ Inapplicable
Changes of the Company’s share number and structure, as well as the corresponding changes in its asset-liability structure
23
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
□Applicable √Inapplicable
II. Total number of shareholders and their shareholding
Unit: share
Total number of shareholders at the
76,162（including: shareholder of A share 53,492）
reporting period
Particulars about shares held by shareholders with a shareholding percentage over 5%
Total Increase Number Pledged or frozen shares
Number
shares /decreas of
of
Name of Nature of Shareholding held at e during non-trad
tradable
shareholder shareholder percentage (%) the the able Status of shares Number of shares
shares
period-e reportin shares
held
nd g period held
SANONDA
State-owned legal 119,687, 119,687,
GROUP 20.15%
person 202 202
CORPORATION
STATE-OWNED
ASSETS
ADMINISTRATI On behalf of the 4,169,2 4,169,2
0.7%
ON BUREAU government 66 66
OF QICHUN
COUNTY
China Minsheng
Banking Co., Ltd.
- Changxin Profit
Increase Dynamic 3,699,8 3,699,8 3,699,8
Other 0.62%
Strategy Equity 37 37 37
Securities
Investment Fund
The Bank Of
China-Yinhua 3,322,2 3,322,2 3,322,2
Other 0.56%
Leading Strategy 54 54 54
Stock Fund
GUOTAI
JUNAN
Foreign legal 2,986,8 128272 2,986,8
SECURITIES(H 0.5%
person 10 0 10
ONGKONG)
LIMITED
24
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
ICBC-Fullgoal
Tianhui Selected 2,705,2 2,705,2 2,705,2
Other 0.46%
Growth Mixed 88 88 88
Type Fund(LOF)
JINGZHOU
SHASHI
Domestic
DISTRICT 2,500,0 2,500,0
non-state-owned 0.42%
UNION RURAL 00 00
legal person
CREDIT
COOPERATION
China
Construction
Bank - Rich
Macro Strategy
2,104,1 2,104,1 2,104,1
Flexible Other 0.35%
26 26 26
Configuration
Hybrid Securities
Investment Funds
LIU Domestic natural 2,007,8 2,007,8
0.34% 641,800
GUOCHENG person 00 00
Domestic natural 1,896,8 1,896,8 1,896,8
ZHENG ENYUE 0.32%
person 00 00 00
Strategic investors or the general
legal person due to the placement of
new shares become the top 10 No
shareholders（if any）(note 3)
The controlling shareholder SANONDA GROUP CORPORATION and the other
shareholders above are not related parties or acting-in-concert parties as prescribed in the
Explanation on associated Administrative Methods for Acquisition of Listed Companies. It is unknown whether the
relationship or/and persons other shareholders above are related parties or acting-in-concert parties as prescribed in the
Administrative Methods for Acquisition of Listed Companies.
Particulars about shares held by top 10 shareholders not subject to trading moratorium
Number of shares held not subject to trading Type of share
Name of shareholder
moratorium at the end of the period Type of share Number
SANONDA GROUP RMB ordinary
119,687,202 119,687,202
CORPORATION share
STATE-OWNED ASSETS 4,169,266 RMB ordinary 4,169,266
25
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
ADMINISTRATION BUREAU OF share
QICHUN COUNTY
China minsheng banking co., LTD. -
long letter ZengLi dynamic strategy RMB ordinary
3,699,837 3,699,837
equity securities investment fund share
The Bank Of China-Yinhua Leading RMB ordinary
3,322,254 3,322,254
Strategy Stock Fund share
GUOTAI JUNAN Domestically
SECURITIES(HONGKONG) 2,986,810 listed foreign 2,986,810
LIMITED share
ICBC-Fullgoal Tianhui Selected RMB ordinary
2,705,288 2,705,288
Growth Mixed Type Fund(LOF share
JINGZHOU SHASHI DISTRICT
RMB ordinary
UNION RURAL CREDIT 2,500,000 2,500,000
share
COOPERATION
China construction bank - rich
RMB ordinary
macro strategy flexible configuration 2,104,126 2,104,126
share
hybrid securities investment funds
Domestically
LIU GUOCHENG 2,007,800 listed foreign 2,007,800
share
Domestically
ZHENG EN YUE 1,896,800 listed foreign 1,896,800
share
Explanation on associated
relationship among the top ten Aforesaid shareholder STATE-OWNED ASSETS ADMINISTRATION BUREAU OF
shareholders of tradable share not QICHUN COUNTY representing the state held the shares of the company. The controlling
subject to trading moratorium, as shareholder SANONDA GROUP CORPORATION and the shareholders above are related
well as among the top ten parties or acting-in-concert parties as prescribed in the Administrative Methods for
shareholders of tradable share not Acquisition of Listed Companies. It is unknown whether the shareholders above are related
subject to trading moratorium and parties or acting-in-concert parties as prescribed in the Administrative Methods for
top ten shareholders, or explanation Acquisition of Listed Companies.
on acting-in-concert
Particular about shareholder
participate in the securities lending
No
and borrowing business ( if
any)( note 4)
Did any shareholder of the Company carry out an agreed buy-back in the reporting period?
□ Yes √ No
26
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
III. Change of the controlling shareholder or the actual controller
Change of the controlling shareholder in the reporting period
□ Applicable √ Inapplicable
Change of the actual controller in the reporting period
□ Applicable √ Inapplicable
27
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
VII. Directors, Supervisors & Senior Management Staff
I. Shareholding changes of directors, supervisors and senior management staff
√ Applicable □ Inapplicable
I. Changes in shareholding of directors, supervisors and senior management staffs
Amount of Amount of
Number of
shares shares Amount of Number of Number of
Shares held locked
increased at decreased at shares held locked locked
Tenure at the shares at the
Name Office title the the at the shares at the shares at the
status year-begin reporting
reporting reporting period-end year-begin period-end
(share) period
period period (share) (share) (share)
(share)
(share) (share)
Chairman
Li Zuorong Current 10,690 10,690
of the Board
Director,
Liu Anping On the post
GM
Director,
He Xuesong Current
CFO
Yin Hong Director On the post
Assistant to
Xie Chengli On the post
GM
Independent
Ai Qiuhong Current
Director
Zhang Independent
Current
Huide Director
Independent
Li Dejun Current
Director
Assistant to
Liu Jianhua Current
GM
Liu Assistant to
On post 28,500 28,500
Zhiming GM
Jiang
Supervisor Current
Chenggang
Liu Jun Supervisor Current 4,100 4,100
28
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Zhou Cheng Supervisor Current
Fu Liping Supervisor On the post
Ding
Supervisor On the post
Shaojun
Board
Li Zhongxi Current
Secretary
Zhang
Supervisor Former 3,660 3,660
Jianguo
Assistant to
Yang guang On the post
GM
Total -- -- 42,850 4,100 0 46,950 0 0 0
II. Changes in engagement and dismissal of Directors, Supervisors and Senior Management
Staffs within the reporting period
Name Position Type Date Reason
Liu Anping general manager On the post 6 Jan, 2013 Appointed general manager for the company
Vice general
Yin Hong On the post 6 Jan, 2013 Appointed vice general manager for the company
manager
Vice general
Xie Chenli On the post 6 Jan, 2013 Appointed vice general manager for the company
manager
After ZhiDaiHui elected the new employee supervisors,
Zhang Jianguo Supervisor Former 6 Jan, 2013 his resignation retake effect
Liu Zhiping Assistant to GM On the post 6 Jan, 2013 Appointed assistant to GM
contract
Yang Guang Assistant to GM 6 Jan, 2013 javascript:void(0);Career moves
termination
Supplemented as director of the sixth board of director to
Xie Chenli Supervisor On the post 24Jan, 2013
the company
Chairman of
Jiang Chenggang On the post 6 Jan, 2013 Elected as the 6th President of the board of supervisors
Supervisor
Supplemented as Supervisor of the sixth board of
Ding Shaojun Supervisor On the post 24 Jan, 2013
Supervisor to the company
Employee
Fu Liping On the post 6 Jan, 2013 ZhiDaiHui electied as supervisors for the company
Supervisor
29
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
VIII. Financial Report
I. Audit report
Has this semi-annual report been audited?
□ Yes √ No
The semi-annual financial report has not been audited.
II. Financial statements
Currency unit for the statements in the notes to these financial statements: RMB Yuan
1. Consolidated balance sheet
Prepared by Hubei Sanonda Co., Ltd
Unit: RMB Yuan
Item Closing balance Opening balance
Current Assets:
Monetary funds 565,722,485.68 175,181,365.77
Settlement reserves
Intra-group lendings
Transactional financial assets
Notes receivable 30,195,791.15 23,690,345.75
Accounts receivable 259,551,232.58 180,964,377.73
Accounts paid in advance 60,974,587.50 37,505,796.88
Premiums receivable
Reinsurance premiums receivable
Receivable reinsurance contract
reserves
Interest receivable
Dividend receivable
Other accounts receivable 18,933,187.01 18,815,365.79
Financial assets purchased under
agreements to resell
Inventories 352,802,676.87 366,759,772.17
Non-current assets due within 1 year
Other current assets
30
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Total current assets 1,288,179,960.79 802,917,024.09
Non-current assets:
Loans by mandate and advances
granted
Available-for-sale financial assets
Held-to-maturity investments
Long-term accounts receivable
Long-term equity investment 9,153,782.63 9,153,782.63
Investing property 4,274,612.50 4,394,812.50
Fixed assets 1,271,016,826.26 1,308,629,352.60
Construction in progress 126,586,329.51 121,263,645.49
Engineering materials
Disposal of fixed assets
Production biological assets
Oil-gas assets
Intangible assets 141,887,980.90 143,904,010.68
R&D expense
Goodwill
Long-term deferred expenses
Deferred income tax assets 16,467,432.66 15,231,757.10
Other non-current assets
Total of non-current assets 1,569,386,964.46 1,602,577,361.00
Total assets 2,857,566,925.25 2,405,494,385.09
Current liabilities:
Short-term borrowings 666,038,937.68 355,708,601.70
Borrowings from Central Bank
Customer bank deposits and due to
banks and other financial institutions
Intra-group borrowings
Transactional financial liabilities
Notes payable 100,000,000.00
Accounts payable 240,162,101.94 198,994,327.26
Accounts received in advance 96,896,413.68 59,448,030.30
Financial assets sold for repurchase
Handling charges and commissions
31
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
payable
Employee’s compensation payable 12,126,926.17 7,364,901.89
Tax payable 25,980,940.09 -19,105,426.98
Interest payable
Dividend payable 682,926.62 349,463.30
Other accounts payable 57,442,128.54 31,369,677.77
Reinsurance premiums payable
Insurance contract reserves
Payables for acting trading of
securities
Payables for acting underwriting of
securities
Non-current liabilities due within 1
236,990,000.00 409,550,000.00
year
Other current liabilities
Total current liabilities 1,436,320,374.72 1,043,679,575.24
Non-current liabilities:
Long-term borrowings 50,000,000.00 80,000,000.00
Bonds payable
Long-term payables 650,000.00 650,000.00
Specific payables
Estimated liabilities
Deferred income tax liabilities
Other non-current liabilities 15,166,111.11 16,309,089.24
Total non-current liabilities 65,816,111.11 96,959,089.24
Total liabilities 1,502,136,485.83 1,140,638,664.48
Owners’ equity (or shareholders’
equity)
Paid-up capital (or share capital) 593,923,220.00 593,923,220.00
Capital reserves 263,166,205.19 266,090,773.02
Less: Treasury stock
Specific reserves 13,855,812.85 13,825,364.46
Surplus reserves 92,680,039.14 92,680,039.14
Provisions for general risks
Retained profits 387,001,545.71 289,017,364.90
32
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Foreign exchange difference
Total equity attributable to owners of
1,350,626,822.89 1,255,536,761.52
the Company
Minority interests 4,803,616.53 9,318,959.09
Total owners’ (or shareholders’) equity 1,355,430,439.42 1,264,855,720.61
Total liabilities and owners’ (or
2,857,566,925.25 2,405,494,385.09
shareholders’) equity
Legal representative: Li Zuorong Person-in-charge of the accounting work: He Xuesong
Chief of the accounting division: He Xuesong
2. Balance sheet of the Company
Prepared by Hubei Sanonda Co., Ltd
Unit: RMB Yuan
Item Closing balance Opening balance
Current Assets:
Monetary funds 453,060,777.43 149,485,252.01
Transactional financial assets
Notes receivable 29,835,791.15 23,690,345.75
Accounts receivable 206,234,958.31 165,720,133.59
Accounts paid in advance 52,641,591.75 26,871,248.52
Interest receivable
Dividend receivable
Other accounts receivable 141,280,633.19 146,640,832.38
Inventories 318,726,969.07 343,538,912.44
Non-current assets due within 1 year
Other current assets
Total current assets 1,201,780,720.90 855,946,724.69
Non-current assets:
Available-for-sale financial assets
Held-to-maturity investments
Long-term accounts receivable
Long-term equity investment 89,226,741.36 83,320,011.36
Investing property 4,274,612.50 4,394,812.50
Fixed assets 1,193,588,027.77 1,228,280,759.41
33
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Construction in progress 38,285,314.14 39,081,376.28
Engineering materials
Disposal of fixed assets
Production biological assets
Oil-gas assets
Intangible assets 127,147,130.55 129,018,867.09
R&D expense
Goodwill
Long-term deferred expenses
Deferred income tax assets 10,927,217.95 10,255,355.43
Other non-current assets
Total of non-current assets 1,463,449,044.27 1,494,351,182.07
Total assets 2,665,229,765.17 2,350,297,906.76
Current liabilities:
Short-term borrowings 512,750,000.00 324,750,000.00
Transactional financial liabilities
Notes payable 100,000,000.00
Accounts payable 219,633,726.56 191,385,928.88
Accounts received in advance 92,478,824.25 63,203,757.83
Employee’s compensation payable 11,766,862.62 3,910,205.00
Tax payable 40,097,670.47 -3,364,366.14
Interest payable
Dividend payable 682,926.62 349,463.30
Other accounts payable 41,688,100.39 25,718,709.48
Non-current liabilities due within 1
236,990,000.00 409,550,000.00
year
Other current liabilities
Total current liabilities 1,256,088,110.91 1,015,503,698.35
Non-current liabilities:
Long-term borrowings 50,000,000.00 80,000,000.00
Bonds payable
Long-term payables 650,000.00 650,000.00
Specific payables
Estimated liabilities
34
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Deferred income tax liabilities
Other non-current liabilities 6,316,111.11 6,860,000.00
Total non-current liabilities 56,966,111.11 87,510,000.00
Total liabilities 1,313,054,222.02 1,103,013,698.35
Owners’ equity (or shareholders’
equity)
Paid-up capital (or share capital) 593,923,220.00 593,923,220.00
Capital reserves 263,799,837.18 263,799,837.18
Less: Treasury stock
Specific reserves 8,886,700.55 8,127,543.89
Surplus reserves 92,680,039.14 92,680,039.14
Provisions for general risks
Retained profits 392,885,746.28 288,753,568.20
Foreign exchange difference
Total owners’ (or shareholders’) equity 1,352,175,543.15 1,247,284,208.41
Total liabilities and owners’ (or
2,665,229,765.17 2,350,297,906.76
shareholders’) equity
Legal representative: Li Zuorong Person-in-charge of the accounting work: He Xuesong
Chief of the accounting division: He Xuesong
3. Consolidated income statement
Prepared by Hubei Sanonda Co., Ltd
Unit: RMB Yuan
Item Jan.-Jun. 2013 Jan.-Jun 2012
I. Total operating revenues 1,519,688,317.22 1,116,755,277.07
Including: Sales income 1,519,688,317.22 1,116,755,277.07
Interest income
Premium income
Handling charge and
commission income
II. Total operating cost 1,349,729,055.68 1,080,620,491.78
Including: Cost of sales 1,210,871,838.98 956,561,172.05
Interest expenses
Handling charge and
35
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
commission expenses
Surrenders
Net claims paid
Net amount withdrawn for the
insurance contract reserve
Expenditure on policy dividends
Reinsurance premium
Taxes and associate charges 1,055,982.69 486,326.30
Selling and distribution expenses 45,575,412.03 35,678,208.25
Administrative expenses 46,726,703.36 43,183,369.31
Financial expenses 40,211,554.98 31,996,393.97
Asset impairment loss 5,287,563.64 12,715,021.90
Add: Gain/(loss) from change in fair
value (“-” means loss)
Gain/(loss) from investment (“-”
2,254,182.43
means loss)
Including: share of profits in associates
and joint ventures
Foreign exchange gains (“-” means
loss)
III. Business profit (“-” means loss) 172,213,443.97 36,134,785.29
Add: non-operating income 1,231,751.57 851,481.06
Less: non-operating expense 2,797,209.72 848,745.45
Including: loss from non-current asset
614,366.72 327,787.29
disposal
IV. Total profit (“-” means loss) 170,647,985.82 36,137,520.90
Less: Income tax expense 43,970,999.05 11,671,651.36
V. Net profit (“-” means loss) 126,676,986.77 24,465,869.54
Including: Net profit achieved by
combined parties before the
combinations
Attributable to owners of the
127,470,524.25 23,986,378.19
Company
Minority shareholders’ income -793,537.48 479,491.35
VI. Earnings per share -- --
(I) Basic earnings per share 0.2146 0.0404
36
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
(II) Diluted earnings per share 0.2146 0.0404
Ⅶ. Other comprehensive incomes
Ⅷ. Total comprehensive incomes 126,676,986.77 24,465,869.54
Attributable to owners of the
127,470,524.25 23,986,378.19
Company
Attributable to minority
-793,537.48 479,491.35
shareholders
Legal representative: Li Zuorong Person-in-charge of the accounting work: He Xuesong
Chief of the accounting division: He Xuesong
4. Income statement of the Company
Prepared by Hubei Sanonda Co., Ltd
Unit: RMB Yuan
Item Jan.-Jun. 2013 Jan.-Jun 2012
I. Total sales 1,496,564,787.97 1,025,044,325.64
Less: cost of sales 1,204,298,974.60 886,916,094.18
Business taxes and surcharges 752,515.01 222,757.83
Distribution expenses 39,184,498.86 27,150,973.97
Administrative expenses 35,163,220.48 32,435,235.50
Financial costs 39,342,339.27 31,536,093.23
Impairment loss 1,928,293.40 9,241,029.13
Add: gain/(loss) from change in fair
value (“-” means loss)
Gain/(loss) from investment (“-” means
2,904,182.43 650,000.00
loss)
Including: income form investment on
associates and joint ventures
II. Business profit (“-” means loss) 178,799,128.78 38,192,141.80
Add: non-business income 632,662.33 851,481.06
Less: non-business expense 2,135,828.74 345,460.00
Including: loss from non-current asset
172,476.55 215,460.00
disposal
III. Total profit (“-” means loss) 177,295,962.37 38,698,162.86
Less: income tax expense 43,677,440.85 10,851,405.64
IV. Net profit (“-” means loss) 133,618,521.52 27,846,757.22
37
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
V. Earnings per share -- --
(I) Basic earnings per share
(II) Diluted earnings per share
VI. Other comprehensive income
VII. Total comprehensive income 133,618,521.52 27,846,757.22
Legal representative: Li Zuorong Person-in-charge of the accounting work: He Xuesong
Chief of the accounting division: He Xuesong
5. Consolidated cash flow statement
Prepared by Hubei Sanonda Co., Ltd
Unit: RMB Yuan
Item Jan.-Jun. 2013 Jan.-Jun 2012
I. Cash flows from operating activities:
Cash received from sale of
1,216,585,450.97 772,261,565.23
commodities and rendering of service
Net increase of deposits from
customers and dues from banks
Net increase of loans from the central
bank
Net increase of funds borrowed from
other financial institutions
Cash received from premium of
original insurance contracts
Net cash received from reinsurance
business
Net increase of deposits of policy
holders and investment fund
Net increase of disposal of tradable
financial assets
Cash received from interest, handling
charges and commissions
Net increase of intra-group
borrowings
Net increase of funds in repurchase
business
Tax refunds received 38,414,903.11 18,058,309.46
38
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Other cash received relating to
20,644,853.51 11,960,367.46
operating activities
Subtotal of cash inflows from operating
1,275,645,207.59 802,280,242.15
activities
Cash paid for goods and services 699,777,411.14 560,436,144.61
Net increase of customer lendings
and advances
Net increase of funds deposited in the
central bank and amount due from
banks
Cash for paying claims of the original
insurance contracts
Cash for paying interest, handling
charges and commissions
Cash for paying policy dividends
Cash paid to and for employees 70,993,456.21 67,251,511.33
Various taxes paid 43,519,631.33 16,861,139.30
Other cash payment relating to
39,201,585.07 25,503,917.74
operating activities
Subtotal of cash outflows from
853,492,083.75 670,052,712.98
operating activities
Net cash flows from operating activities 422,153,123.84 132,227,529.17
II. Cash flows from investing activities:
Cash received from withdrawal of
investments
Cash received from return on
2,254,182.43
investments
Net cash received from disposal of
fixed assets, intangible assets and other 248,934.00 12,000.00
long-term assets
Net cash received from disposal of
subsidiaries or other business units
Other cash received relating to
investing activities
Subtotal of cash inflows from
2,503,116.43 12,000.00
investing activities
Cash paid to acquire fixed assets,
65,136,665.53 69,187,944.42
intangible assets and other long-term
39
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
assets
Cash paid for investment
Net increase of pledged loans
Net cash paid to acquire subsidiaries
and other business units
Other cash payments relating to
investing activities
Subtotal of cash outflows from
65,136,665.53 69,187,944.42
investing activities
Net cash flows from investing activities -62,633,549.10 -69,175,944.42
III. Cash Flows from Financing
Activities:
Cash received from capital
contributions
Including: Cash received from
minority shareholder investments by
subsidiaries
Cash received from borrowings 703,440,215.57 517,328,770.69
Cash received from issuance of
bonds
Other cash received relating to
financing activities
Subtotal of cash inflows from financing
703,440,215.57 517,328,770.69
activities
Repayment of borrowings 595,669,879.59 352,586,762.89
Cash paid for interest expenses and
60,200,842.26 36,824,366.87
distribution of dividends or profit
Including: dividends or profit paid
350,000.00 350,000.00
by subsidiaries to minority shareholders
Other cash payments relating to
31,525,101.46 19,098,876.69
financing activities
Sub-total of cash outflows from
687,395,823.31 408,510,006.45
financing activities
Net cash flows from financing activities 16,044,392.26 108,818,764.24
IV. Effect of foreign exchange rate
-1,022,847.09 117,625.02
changes on cash and cash equivalents
V. Net increase in cash and cash
374,541,119.91 171,987,974.01
equivalents
40
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Add: Opening balance of cash and
175,181,365.77 219,587,687.99
cash equivalents
VI. Closing balance of cash and cash
549,722,485.68 391,575,662.00
equivalents
Legal representative: Li Zuorong Person-in-charge of the accounting work: He Xuesong
Chief of the accounting division: He Xuesong
6. Cash flow statement of the Company
Prepared by Hubei Sanonda Co., Ltd
Unit: RMB Yuan
Item Jan.-Jun. 2013 Jan.-Jun 2012
I. Cash flows from operating activities:
Cash received from sale of
1,180,407,638.73 710,865,542.67
commodities and rendering of service
Tax refunds received 32,620,291.11 12,650,502.53
Other cash received relating to
14,527,560.25 4,745,921.19
operating activities
Subtotal of cash inflows from operating
1,227,555,490.09 728,261,966.39
activities
Cash paid for goods and services 642,233,436.72 505,127,094.11
Cash paid to and for employees 61,740,235.42 57,747,772.92
Various taxes paid 38,874,866.67 12,731,963.09
Other cash payment relating to
33,820,822.19 39,041,881.71
operating activities
Subtotal of cash outflows from
776,669,361.00 614,648,711.83
operating activities
Net cash flows from operating activities 450,886,129.09 113,613,254.56
II. Cash flows from investing activities:
Cash received from retraction of
investments
Cash received from return on
2,254,182.43
investments
Net cash received from disposal of
fixed assets, intangible assets and other 248,934.00 12,000.00
long-term assets
Net cash received from disposal of
41
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
subsidiaries or other business units
Other cash received relating to
investing activities
Subtotal of cash inflows from
2,503,116.43 12,000.00
investing activities
Cash paid to acquire fixed assets,
intangible assets and other long-term 63,062,598.35 64,337,692.43
assets
Cash paid for investment 5,906,730.00
Net cash paid to acquire subsidiaries
and other business units
Other cash payments relating to
1,000,000.00
investing activities
Subtotal of cash outflows from
68,969,328.35 65,337,692.43
investing activities
Net cash flows from investing activities -66,466,211.92 -65,325,692.43
III. Cash Flows from Financing
Activities:
Cash received from capital
contributions
Cash received from borrowings 498,000,000.00 406,000,000.00
Cash received from issuance of
bonds
Other cash received relating to
financing activities
Subtotal of cash inflows from financing
498,000,000.00 406,000,000.00
activities
Repayment of borrowings 512,560,000.00 298,000,000.00
Cash paid for interest expenses and
57,358,841.82 35,424,094.23
distribution of dividends or profit
Other cash payments relating to
24,880,000.00 18,000,000.00
financing activities
Sub-total of cash outflows from
594,798,841.82 351,424,094.23
financing activities
Net cash flows from financing activities -96,798,841.82 54,575,905.77
IV. Effect of foreign exchange rate
-45,549.93 -64.22
changes on cash and cash equivalents
V. Net increase in cash and cash 287,575,525.42 102,863,403.68
42
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
equivalents
Add: Opening balance of cash and
149,485,252.01 178,056,420.12
cash equivalents
VI. Closing balance of cash and cash
437,060,777.43 280,919,823.80
equivalents
Legal representative: Chen Hongcheng Chief of the accounting work: Chen Jincai Chief of the accounting organ: Zheng Guangde
7. Consolidated Statement of Changes in Owners’ Equity
Prepared by Guangdong Rieys Group Company Ltd
Jan.-Jun. 2013
Unit: RMB Yuan
Jan.-Jun. 2013
Equity attributable to owners of the Company
Paid-up
Total
Item capital Minority
Less: General
Capital Specific Surplus Retaine owners’
(or treasury risk Others interests
reserve reserve reserve d profit equity
share stock reserve
capital)
I. Balance at the end of the 593,923 266,090, 13,825,3 92,680, 289,017, 9,318,959 1,264,855,
previous year ,220.00 773.02 64.46 039.14 364.90 .09 720.61
Add: change of accounting
policy
Correction of errors in
previous periods
Other
II. Balance at the beginning of 593,923 266,090, 13,825,3 92,680, 289,017, 9,318,959 1,264,855,
the year ,220.00 773.02 64.46 039.14 364.90 .09 720.61
III. Increase/ decrease in the -2,924,5 30,448.3 97,984,1 -4,515,34 90,574,718
period (“-” means decrease) 67.83 9 80.81 2.56 .81
127,470, -793,537. 126,676,98
(I) Net profit
524.25 48 6.77
(II) Other comprehensive
incomes
127,470, -793,537. 126,676,98
Subtotal of (I) and (II)
524.25 48 6.77
(III) Capital paid in and -2,924,5 -2,982,16 -5,906,730.
reduced by owners 67.83 2.17 00
43
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
1. Capital paid in by
owners
2. Amounts of share-based
payments recognized in
owners’ equity
-2,924,5 -2,982,16 -5,906,730.
3. Others
67.83 2.17 00
-29,486, -350,000. -29,836,34
(IV) Profit distribution
343.44 00 3.44
1. Appropriations to
surplus reserves
2. Appropriations to
general risk provisions
3. Appropriations to -29,486, -350,000. -29,836,34
owners (or shareholders) 343.44 00 3.44
4. Other
(V) Internal carry-forward of
owners’ equity
1. New increase of capital
(or share capital) from capital
public reserves
2. New increase of capital
(or share capital) from surplus
reserves
3. Surplus reserves for
making up losses
4. Other
30,448.3 -389,642. -359,194.5
(Ⅵ) Specific reserve
9 91 2
1. Withdrawn for the 5,317,74 324,559.1 5,642,304.
period 5.19 8 37
5,287,29 714,202.0 6,001,498.
2. Used in the period
6.80 9 89
(Ⅶ) Other
593,923 263,166, 13,855,8 92,680, 387,001, 4,803,616 1,355,430,
IV. Closing balance
,220.00 205.19 12.85 039.14 545.71 .53 439.42
Jan.-Jun. 2012
Unit: RMB Yuan
44
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Jan.-Jun. 2013
Equity attributable to owners of the Company
Paid-up
Total
Item capital Less: General Minority
Capital Specific Surplus Retaine owners’
(or treasury risk Others interests
reserve reserve reserve d profit equity
share stock reserve
capital)
I. Balance at the end of the 593,923 266,649, 17,847,0 80,383, 197,544, 9,118,830. 1,165,466,
previous year ,220.00 062.72 14.86 814.33 620.36 03 562.30
Add: retrospective
adjustment due to business
combination under the same
control
Add: change of accounting
policy
Correction of errors in
previous periods
Other
II. Balance at the beginning of 593,923 266,649, 17,847,0 80,383, 197,544, 9,118,830. 1,165,466,
the year ,220.00 062.72 14.86 814.33 620.36 03 562.30
III. Increase/ decrease in the -929,77 4,966,76 23,986,3 426,777.8 28,450,145
period (“-” means decrease) 7.70 7.50 78.19 8 .87
23,986,3 479,491.3 24,465,869
(I) Net profit
78.19 5 .54
(II) Other comprehensive
incomes
23,986,3 479,491.3 24,465,869
Subtotal of (I) and (II)
78.19 5 .54
(III) Capital paid in and -929,77 -70,222.3 -1,000,000.
reduced by owners 7.70 0 00
1. Capital paid in by
owners
2. Amounts of share-based
payments recognized in
owners’ equity
-929,77 -70,222.3 -1,000,000.
3. Others
7.70 0 00
-350,000. -350,000.0
(IV) Profit distribution
00 0
45
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
1. Appropriations to
surplus reserves
2. New increase of capital
(or share capital) from surplus
reserves
3. Surplus reserves for -350,000. -350,000.0
making up losses 00 0
4. Other
(V) Internal carry-forward of
owners’ equity
1. New increase of capital
(or share capital) from capital
public reserves
2. New increase of capital
(or share capital) from surplus
reserves
3. Surplus reserves for
making up losses
4. Other
4,966,76 367,508.8 5,334,276.
(Ⅵ) Specific reserve
7.50 3 33
1. Withdrawn for the 5,507,55 425,252.2 5,932,810.
period 8.29 5 54
540,790.
2. Used in the period 57,743.42 598,534.21
79
(Ⅶ) Other
593,923 265,719, 22,813,7 80,383, 221,530, 9,545,607 1,193,916,
IV. Closing balance
,220.00 285.02 82.36 814.33 998.55 .91 708.17
Legal representative: Li Zuorong Person-in-charge of the accounting work: He Xuesong
Chief of the accounting division: He Xuesong
8. Statement of changes in owners’ equity of the Company
Prepared by Hubei Sanonda Co., Ltd
Reporting period
Unit: RMB Yuan
Jan.-Jun. 2013
Item
Paid-up Capital Less: Specific Surplus General Retained Total
46
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
capital (or reserve treasury reserve reserve risk profit owners’
share stock reserve equity
capital)
I. Balance at the end of the 593,923,22 263,799,83 8,127,543. 92,680,039 288,753,56 1,247,284,
previous year 0.00 7.18 89 .14 8.20 208.41
Add: change of accounting
policy
Correction of errors in
previous periods
Other
II. Balance at the beginning of 593,923,22 263,799,83 8,127,543. 92,680,039 288,753,56 1,247,284,
the year 0.00 7.18 89 .14 8.20 208.41
III. Increase/ decrease in the 104,132,17 104,891,33
759,156.66
period (“-” means decrease) 8.08 4.74
133,618,52 133,618,52
(I) Net profit
1.52 1.52
(II) Other comprehensive
incomes
133,618,52 133,618,52
Subtotal of (I) and (II)
1.52 1.52
(III) Capital paid in and
reduced by owners
1. Capital paid in by owners
2. Amounts of share-based
payments recognized in owners’
equity
3. Others
-29,486,34 -29,486,34
(IV) Profit distribution
3.44 3.44
1. Appropriations to surplus
reserves
2. Appropriations to general
risk provisions
3. Appropriations to owners -29,486,34 -29,486,34
(or shareholders) 3.44 3.44
4. Other
(V) Internal carry-forward of
owners’ equity
47
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
1. New increase of capital
(or share capital) from capital
public reserves
2. New increase of capital
(or share capital) from surplus
reserves
3. Surplus reserves for
making up losses
4. Other
(Ⅵ) Specific reserve 759,156.66 759,156.66
4,714,992. 4,714,992.
1. Withdrawn for the period
42 42
3,955,835. 3,955,835.
2. Used in the period
76 76
(Ⅶ) Other
593,923,22 263,799,83 8,886,700. 92,680,039 392,885,74 1,352,175,
IV. Closing balance
0.00 7.18 55 .14 6.28 543.15
Jan.-Jun. 2012
Unit: RMB Yuan
Jan.-Jun. 2012
Paid-up
Less: General Total
Item capital (or Capital Specific Surplus Retained
treasury risk owners’
share reserve reserve reserve profit
stock reserve equity
capital)
I. Balance at the end of the 593,923,22 263,799,83 12,647,237 80,383,814 178,087,54 1,128,841,
previous year 0.00 7.18 .00 .33 4.90 653.41
Add: change of accounting
policy
Correction of errors in
previous periods
Other
II. Balance at the beginning of 593,923,22 263,799,83 12,647,237 80,383,814 178,087,54 1,128,841,
the year 0.00 7.18 .00 .33 4.90 653.41
III. Increase/ decrease in the 3,936,387. 27,846,757 31,783,145
period (“-” means decrease) 88 .22 .10
27,846,757 27,846,757
(I) Net profit
.22 .22
(II) Other comprehensive
48
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
incomes
27,846,757 27,846,757
Subtotal of (I) and (II)
.22 .22
(III) Capital paid in and
reduced by owners
1. Capital paid in by owners
2. Amounts of share-based
payments recognized in owners’
equity
3. Others
(IV) Profit distribution
1. Appropriations to surplus
reserves
2. Appropriations to general
risk provisions
3. Appropriations to owners
(or shareholders)
4. Other
(V) Internal carry-forward of
owners’ equity
1. New increase of capital
(or share capital) from capital
public reserves
2. New increase of capital
(or share capital) from surplus
reserves
3. Surplus reserves for
making up losses
4. Other
3,936,387. 3,936,387.
(Ⅵ) Specific reserve
88 88
4,198,329. 4,198,329.
1. Withdrawn for the period
75 75
2. Used in the period 261,941.87 261,941.87
(Ⅶ) Other
593,923,22 263,799,83 16,583,624 80,383,814 205,934,30 1,160,624,
IV. Closing balance
0.00 7.18 .88 .33 2.12 798.51
Legal representative: Li Zuorong Person-in-charge of the accounting work: He Xuesong
49
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Chief of the accounting division: He Xuesong
(III). Company profile
Hubei Sanonda Co., Ltd. (hereinafter referred to as "Company" or "the Company") is formerly
known as Hubei Sha City Pesticides Factory, a state-run enterprise set up in 1958. As approved by
the Hubei Commission for Economic System Reformation and other authorities, Hubei Sha City
Pesticides Factory was reorganized as Hubei Sanonda Co., Ltd., which marked Hubei’s first large
state-run industrial enterprise to adopt the stock system. On 8 Sept. 1992, upon the said
reorganization, the Company was formally established. Later, as approved by the People's
Government of Hubei Province and the China Securities Regulatory Commission (“CSRC”), the
Company issued 30,000,000 RMB-denominated ordinary shares ("A shares") to the public in Nov.
1993. And the total share capital of the Company was 104,933,900 shares after the public offering.
The Sha City Bureau for State-owned Assets Supervision and Administration is the first majority
shareholder of the Company, with a capital contribution of RMB 57,467,900, accounting for
54.77% of the Company’s total share capital. On 3 Dec. 1993, shares of the Company were listed in
the Shenzhen Stock Exchange.
In Apr. 1994, a dividend distribution plan was reviewed and approved at the 1993 Annual
Shareholders’ General Meeting. RMB 2.00 was distributed in cash for every 10 shares held by the
state and two bonus shares for every 10 shares held by individuals. The bonus shares were listed in
3 May 1994. And the Company’s total share capital rose to 113,988,000 shares after distribution of
the said bonus shares, with shares held by the first majority shareholder accounting for 50.42% of
the Company’s total shares.
In 1994, Jingzhou City and Sha City were combined and renamed as “Jingsha City”, Jiangling
County as “Jiangling District of Jingsha City”, and the Sha City Bureau for State-owned Assets
Supervision and Administration and the Jiangling County Bureau for State-owned Assets
Supervision and Administration (originally two shareholders of the Company) as “the Jingsha City
Bureau for State-owned Assets Supervision and Administration”. As such, the 50.42% and 1.93%
equity interests of the Company formerly held by the Sha City Bureau for State-owned Assets
Supervision and Administration and the Jiangling County Bureau for State-owned Assets
Supervision and Administration respectively were transferred to the Jingsha City Bureau for
State-owned Assets Supervision and Administration, which held 52.35% of the Company’s total
shares.
On 9 Aug. 1995, as approved at the Company’s 1994 Annual Shareholders’ General Meeting, the
Jingsha City Bureau for State-owned Assets Supervision and Administration transferred 3,002,700
shares it held in the Company (2.14% of the Company’s total shares) to the Qichun County Bureau
for State-owned Assets Supervision and Administration. After the said transfer, the Jingsha City
Bureau for State-owned Assets Supervision and Administration (the Company’s first majority
shareholder) held 50.21% of the Company’s total shares.
In Jul. 1995, the Company held the 1994 Annual Shareholders’ General Meeting, at which a share
allotment plan (three shares being allotted for every ten shares) was reviewed and approved. After
the said share allotment, the Company’s total number of shares rose to 139,970,500, with the
Jingsha City Bureau for State-owned Assets Supervision and Administration holding 44.66%.
In Nov. 1996, as approved by the “Document Zheng-Jian-Shang-Zi [1996] No.13” issued by CSRC,
the Company carried out the share allotment plan (three shares being allotted for every ten shares)
for the year 1996. A total of 41,991,100 shares of the Company were allotted, of which 19,552,900
shares were allotted for state-held shares and 22,438,200 shares for individual-held shares. After the
50
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
said share allotment, the Company’s total number of shares rose to 181,969,600. And the
shareholding ratio of every shareholder remained unchanged after the allotment.
In 1996, pursuant to the “E-Zheng-Ban-Han [1995] No.92 Reply of People’s Government of Hubei
Province on Authorizing Sanonda Group to Operate State-owned Assets”, in order to safeguard the
state-owned shares of the Company held by it, the Jingsha City Bureau for State-owned Assets
Supervision and Administration incorporated Sanonda Group and transferred the Company’s equity
interests it held to Sanonda Group. As such, Sanonda Group became the Company’s first majority
shareholder, holding 44.66% of the Company’s total shares.
From 29 Apr. to 5 May 1997, as approved by the “Zheng-Fa (1997) No.23 Document” issued by the
Securities Commission under the State Council, the Company issued 0.1 billion domestically-listed
foreign shares (B shares) of RMB 1.00 par value, which were listed in the Shenzhen Stock
Exchange for trading on 15 May 1997. And the Company exercised the over-allotment options of
15 million shares from 15 May to 21 May in the same year. After issuance of the said B shares, the
Company’s total number of shares rose to 296,961,600 shares, and the shareholding ratio of
Sanonda Group—the Company’s first majority shareholder—was changed to 27.52%.
On 20 May 2005, the Jingzhou City Bureau for State-owned Assets Supervision and Administration
and China National Agrochemical Corporation (a wholly-owned subsidiary under China National
Chemical Corporation) signed the “Agreement on Transferring Assets of Sanonda Group”. The
State-Owned Assets Supervision and Administration Commission of the People’s Government of
Hubei Province issued the “E-Guo-Zi-Chan-Quan [2005] No.177 Reply on Transferring
State-owned Assets of Sanonda Group with Compensation”. As a result, the People’s Government
of Jingzhou City was approved to transfer all state-owned assets of Sanonda Group to China
National Agrochemical Corporation with compensation, with the transfer base date on 31 Dec. 2004.
After the said transfer, Sanonda Group became a wholly-owned subsidiary under China National
Agrochemical Corporation.
In 2006, pursuant to the “Guo-Zi-Chan-Quan [2006] No.767 Reply of State-owned Assets
Supervision and Administration Commission under the State Council on Affairs Related to Share
Reform of Hubei Sanonda Co., Ltd.”, the “Share Reform Plan of Hubei Sanonda Co., Ltd.” was
reviewed and approved at the shareholders’ general meeting held on 8 Jul. 2006. And the share
reform was completed in Aug. 2006. With the base of 296,961,600 tradable shares, 2.2 shares were
paid to tradable A-share holders by non-tradable share holders as consideration for every 10
tradable A-shares, with the total number of shares paid by non-tradable share holders to tradable
share holders reaching 21,391,100,000 shares. After the share reform, the total number of the
Company’s shares remained unchanged, of which Sanonda Group held 61093,600 shares,
accounting for 20.57% of the Company’s total shares.
In Nov. 2006 and Mar. 2007, due to a dispute case concerning the provision of a loan guarantee by
the Company’s first majority shareholder—Sanonda Group—for an other company, 1.25 million
and 0.40 million state-owned corporate shares of the Company held by Sanonda Group were
forcibly transferred and auctioned by the court. After the auctions, shares of the Company held by
Sanonda Group were reduced to 59,443,600 shares, accounting for 20.02% of the Company’s total
shares.
In May 2007, the Company held the 2006 Annual Shareholders’ General Meeting, at which the
plan for turning capital reserve to share capital was reviewed and approved. As a result, 10 shares
were increased for every 10 shares held by all shareholders in Jul. 2007. After the increase, the
Company’s total number of shares rose to 593,923,200 shares. The first majority
shareholder—Sanonda Group—held 118,887,200 shares, accounting for 20.02% of the Company’s
total shares. And for the period up to 30 Jun. 2012, the share capital of the Company remained
51
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
unchanged.
On 16 Nov. 2012, Sanonda Group Co., Ltd. acquired 800,000 shares of the Company held by the
to-be-cancelled subsidiary—Jingzhou Sanonda Advertising Co., Ltd. through the block trading
market, then it held a total of 119,687,200 shares of the Company, accounting for 20.15% of the Company’s
total share capital, and up to 31 Dec. 2012, the share capital of the Company remained unchanged.
As at the balance sheet date, Legal representative of the Company: Li Zuorong; Registered address:
No.93, Beijing East Road, Jingzhou, Hubei Province, PRC; Stock abbreviation: Sanonda A/
Sanonda B; and Stock code: 000553/ 200553.
The Company and its subsidiaries (hereinafter referred to as “the Group”) is principally engaged in
pesticide products such as orthene, paraquate, glyphosate, trichlorphon, DDVP, omethoate,
triazophos, imidacloprid and carbofuran; chemical products such as spermine, liquid caustic soda,
liquefied chlorine gas and hydrochloric acid. The Company has the rights of handling import and
export business. And the Company has passed ISO9002 Quality System Certification and ISO14001
Environment Management System Certification.
The parent company of the Group is Sanonda Group and the ultimate parent company is China
National Chemical Corporation.
The financial statements for 2012 have been authorized to be issued by at the board session
held by the Company on 13 Mar. 2013.
(IV) Main accounting policies and estimates and corrections of previous accounting errors
1. Basis for the preparation of financial statements
With the going-concern assumption as the basis and based on transactions and other events that
actually occurred, the Group prepared financial statements in accordance with the Basic Standard
and 38 specific standards of Accounting Standards for Business Enterprises issued by Ministry of
Finance of the PRC on 15 February 2006, Application Guidance of Accounting Standard for
Business Enterprises, Interpretation of Accounting Standards for Business Enterprises and other
regulations issued thereafter (hereinafter referred to as “the Accounting Standards for Business
Enterprises”, “China Accounting Standards” or “CAS”), Rules for Preparation Convention of
Disclosure of Public Offering Companies No.15 – General Regulations for Financial Reporting
(revised in 2010) by China Securities Regulatory Commission.
In accordance with relevant provisions of the Accounting Standards for Business Enterprises, the
Group adopted the accrual basis in accounting. Except for some financial instruments, where
impairment occurred on an asset, an impairment reserve was withdrawn accordingly pursuant to
relevant requirements.
2. Statement of Compliance with the Accounting Standards for Business Enterprises
The financial statements prepared by the Group are in compliance with in compliance with the
Accounting Standards for Business Enterprises, which factually and completely present the
Company’s and the Group’s financial positions as at 30 Jun. 2012, business results and cash flows
for the first half year of 2012, and other relevant information. In addition, the Company’s and the
Group’s financial statements meet the requirements of disclosing financial statements and notes
thereto stated in the Rules for Preparation Convention of Disclosure of Public Offering Companies
No.15 – General Regulations for Financial Reporting (revised in 2010) by China Securities
52
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Regulatory Commission.
3. Fiscal period
The Group’s fiscal periods include fiscal years and fiscal periods shorter than a complete fiscal year.
The Group’s fiscal year starts on 1 Jan. and ends on 31 Dec. of every year according to the
Gregorian calendar. And the fiscal period of the financial report is from 1 Jan. to 30 Jun..
4. Bookkeeping base currency
Renminbi is the dominant currency used in the economic circumstances where the Company and its
domestic subsidiaries are involved. Therefore, the Company and its domestic subsidiaries use
Renminbi as their bookkeeping base currency. And the Group adopted Renminbi as the
bookkeeping base currency when preparing the financial statements for the reporting year.
Bookkeeping base currency for overseas subsidiaries
5. Accounting treatment methods for business combinations under the same control and those
not under the same control.
(1) Business combinations under the same control
A business combination under the same control is a business combination in which all of the
combining enterprises are ultimately controlled by the same party or the same parties both before
and after the business combination and on which the control is not temporary. In a business
combination under the same control, the party which obtains control of other combining enterprise(s)
on the combining date is the combining party, the other combining enterprise(s) is (are) the
combined party. The “combining date” refers to the date on which the combining party actually
obtains control on the combined party.
The assets and liabilities that the combining party obtains in a business combination shall be
measured on the basis of their carrying amount in the combined party on the combining date. As for
the balance between the carrying amount of the net assets obtained by the combining party and the
carrying amount of the consideration paid by it (or the total par value of the shares issued), the
additional paid-in capital (share premium) shall be adjusted. If the additional paid-in capital (share
premium) is not sufficient to be offset, the retained earnings shall be adjusted.
The direct cost for the business combination of the combining party shall be recorded into the
profits and losses at the current period.
(2) Business combinations not under the same control
A business combination not under the same control is a business combination in which the
combining enterprises are not ultimately controlled by the same party or the same parties both
before and after the business combination. In a business combination not under the same control,
the party which obtains the control on other combining enterprise(s) on the purchase date is the
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acquirer, and other combining enterprise(s) is (are) the acquiree.
For a business combination not under the same control, the combination costs shall include the fair
values, on the acquisition date, of the assets paid, the liabilities incurred or assumed and the equity
securities issued by the acquirer in exchange for the control on the acquiree, the expenses for audit,
legal services and assessment, and other administrative expenses, which are recorded into the
profits and losses in the current period. The trading expenses for the equity securities or debt
securities issued by the acquirer as the combination consideration shall be recorded into the amount
of initial measurement of the equity securities or debt securities. The involved contingent
consideration shall be recorded into the combination costs at its fair value on the acquiring date.
Where new or further evidences emerge, within 12 months since the acquiring date, against the
existing circumstances on the acquiring date and the contingent consideration thus needs to be
adjusted, the combined goodwill shall be adjusted accordingly. In a business combination realized
by two or more transactions of exchange, in the Group’s consolidated financial statements, as for
the equity interests that the Group holds in the acquiree before the acquiring date, they shall be
re-measured according to their fair values at the acquiring date; the positive difference between
their fair values and carrying amounts shall be recorded into the investment gains for the period
including the acquiring date; other comprehensive gains in relation to the equity interests that the
Group holds in the acquiree before the acquiring date shall be transferred into investment gains in
the current period; and the combination costs shall be the summation of the fair values at the
acquiring date of the equity interests that the Group holds in the acquiree before the acquiring date
and the fair values at the acquiring date of the equity interests that Group increases in the acquiree
on the acquiring date.
The combination costs of the acquirer and the identifiable net assets obtained by it in the
combination shall be measured according to their fair values at the acquiring date. The acquirer
shall recognize the positive balance between the combination costs and the fair value of the
identifiable net assets it obtains from the acquiree as business reputation. Where the combination
costs are less then the fair value of the identifiable net assets it obtains from the acquiree, the
acquirer shall re-examine the measurement of the fair values of the identifiable assets, liabilities and
contingent liabilities it obtains from the acquiree as well as the combination costs. If, after the
reexamination, the combination costs are still less than the fair value of the identifiable net assets it
obtains from the acquiree, the acquirer shall record the balance into the profits and losses of the
current period.
As for the deductible temporary differences the acquirer obtains from the acquiree which are not
recognized into deferred income tax liabilities due to their not meeting the recognition standards, if
new or further information shows that the relevant situation has existed on the acquiring date and
the economic benefits brought by the deductible temporary differences the acquirer obtains from the
acquiree on the acquiring date can be realized, they shall be recognized into deferred income tax
assets and the relevant goodwill shall be reduced. Where the goodwill is not sufficient to be offset,
the difference shall be recognized into the profits and losses in the current period. In other
circumstances than the above, where the deductible temporary differences are recognized into
deferred income tax assets on the acquiring date, they shall be recorded into the profits and losses in
the current period.
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6. Methods for preparing consolidated financial statements
(1) Preparation methods for consolidated financial statements
1) Principle for determining the consolidation scope
The consolidation scope for financial statements is determined on the basis of control. The term
“control” is the power of the Company to determine financial and business policies of an investee
and obtain benefits from the investee’s operating activities. The consolidated financial statements
comprise the financial statements of the Company and its subsidiaries. A subsidiary is an enterprise
or entity controlled by the Company.
2) Methods for preparing the consolidated financial statements
Subsidiaries are fully consolidated from the date on which the Group obtains control on their net
assets and operation decision-making and are de-consolidated from the date when such control
ceases. As for a disposed subsidiary, its operating results and cash flows before the disposal date
has been appropriately included in the consolidated income statement and cash flow statement; and
as for subsidiaries disposed in the current period, the opening items in the consolidated balance
sheet are not adjusted. For a subsidiary acquired in a business combination not under the same
control, its operating results and cash flows after the acquiring date have been appropriately
included in the consolidated income statement and cash flow statement, and the opening items and
comparative items in the consolidated financial statements are not adjusted. For a subsidiary
acquired in a business combination under the same control or a combined party obtained in a
takeover, its operating results and cash flows from the beginning of the reporting period of the
combination to the combination date have been appropriately included in the consolidated income
statement and cash flow statement, and the comparative items in the consolidated financial
statements are adjusted at the same time.
The financial statements of subsidiaries are adjusted in accordance with the accounting policies and
accounting period of the Company during the preparation of the consolidated financial statements,
where the accounting policies and the accounting periods are inconsistent between the Company
and subsidiaries. For a subsidiary acquired from a business combination not under the same control,
the individual financial statements of the subsidiary are adjusted based on the fair value of the
identifiable net assets at the acquisition date.
All significant inter-group balances, transactions and unrealized profits are offset in the
consolidated financial statements.
The portion of a subsidiary’s shareholders’ equity and the portion of a subsidiary’s net profits and
losses for the period not held by the Company are recognized as minority interests and minority
shareholder profits and losses respectively and presented separately under shareholders’ equity and
net profits in the consolidation financial statements. The portion of a subsidiary’s net profits and
losses for the period that belong to minority interests is presented as the item of “minority
shareholder profits and losses” under the bigger item of net profits in the consolidated financial
statements. Where the loss of a subsidiary shared by minority shareholders exceeds the portion
enjoyed by minority shareholders in the subsidiary’s opening owners’ equity, minority interests are
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
offset.
Where the Company losses control on its original subsidiaries due to disposal of some equity
investments or other reasons, the residual equity interests are re-measured according to the fair
value on the date when such control ceases. The summation of the consideration obtained from the
disposal of equity interests and the fair value of the residual equity interests, minus the portion in
the original subsidiary’s net assets measured on a continuous basis from the acquisition date that is
enjoyable by the Company according to the original shareholding percentage in the subsidiary, is
recorded in investment gains for the period when the Company’s control on the subsidiary ceases.
Other comprehensive incomes in relation to the equity investment in the original subsidiary are
transferred to investment gains for the period when such control ceases. And subsequent
measurement is conducted on the residual equity interests according to the No.2 Accounting
Standard for Business Enterprises —Long-term Equity Investments or the No.22 Accounting
Standard for Business Enterprises—Recognition and Measurement of Financial Instruments.
(2) As for the event about purchasing and then selling (or selling and then purchasing) equities of
the same subsidiary, the Company shall disclose relevant accounting treatment methods.
7. Recognition standard for cash and cash equivalents
In the Group’s understanding, cash and cash equivalents include cash on hand, any deposit that can
be used for cover, and short-term (usually due within 3 months since the day of purchase) and high
circulating investments, which are easily convertible into known amount of cash and whose risks in
change of value are minimal.
8. Foreign currency businesses and translation of foreign currency financial statements
(1) Foreign currency
1) Accounting treatments for translation of foreign currency transactions
As for a foreign currency transaction, the Company shall convert the amount in a foreign currency
into amount in its bookkeeping base at the spot exchange rate of the transaction date, while as for such
transactions as foreign exchange or involving in foreign exchange, the Company shall converted into
amount in the bookkeeping base currency at actual exchange rate the transaction is occurred.
(2) Accounting treatments for translation of foreign currency monetary items and non-monetary
items
On the balance sheet date, the foreign currency monetary items shall be translated at the spot
exchange rate on the balance sheet date. The exchange difference arising from the difference
between the spot exchange rate on the balance sheet date and the spot exchange rate at the time of
initial recognition or prior to the balance sheet date shall be recorded in the profits and losses in the
current period, excluding the following situations:
① the exchange difference arising from foreign currency loans related to acquisition of fixed assets
shall be treated at the principle of capitalization of borrowing costs;
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
② the exchange difference arising from change in the book balance of foreign currency monetary
items available for sale except the amortized costs shall be recorded into other comprehensive gains
and losses.
A foreign currency non-monetary item measured at the historical costs shall still be translated at the
spot exchange rate on the transaction date. Where the foreign nonmonetary items measured at the
fair value shall be converted into amount in its bookkeeping base currency at spot exchange rate,
the exchange gains and losses arising thereof shall be treated as change in fair value, and recorded
into the current period gains and losses or as other comprehensive gains and losses and recorded
into capital reserves.
(2) Translation of foreign currency financial statements
When it involves overseas business in preparing the consolidated financial statement, for the
translation difference of foreign currency monetary items of net investment in overseas business
arising from the change in exchange rate, it shall be recorded into the item of “difference of foreign
currency financial statement translation” under the owners’ equity; and be recorded into disposal
gains and losses at current period when disposing overseas business.
The foreign currency financial statement of overseas business should be translated in to RMB
financial statement by the following methods: The asset and liability items in the balance sheets shall
be translated at a spot exchange rate on the balance sheet date. Among the owner’s equity items,
except for the items as “undistributed profits”, other items shall be translated at the spot exchange rate
at the time when they are incurred. The income and expense items in the profit statements shall be
translated at the spot exchange rate of the transaction date. The undistributed profits at year-begin is
the undistributed profits at the end of last year after the translation; undistributed profits at year-end
shall be listed as various distribution items after the translation; after the translation, the balance
between assets and the sum of liabilities and owners’ equities shall be recorded into other
comprehensive gains and losses as difference of foreign currency translation, and individually listed
under the item of owners’ equity in the balance sheet. Where an enterprise disposes of an overseas
business without the control right, it shall shift the differences, which is presented under the items of
the owner’s equities in the balance sheet and which arises from the translation of foreign currency
financial statements relating to this overseas business, into the disposal profits and losses of the
current period by all or proportion of the disposed overseas business.
Foreign cash flow shall be translated at the spot exchange rate of the date of cash flow incurred. The
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
influence of exchange rate on the cash flow shall be adjustment item and individually listed in the
cash flow statement.
And the opening balance and the actual balance of last year shall be listed at the amounts after
translation of foreign currency financial statement in last year.
9. Financial instruments
The term "financial instruments" refers to the contracts under which the financial assets of an
enterprise are formed and the financial liability or right instruments of any other entity are formed.
(1) Classification of financial assets
Financial assets shall be classified into the following four categories when they are initially
recognized: (a) the financial assets which are measured at their fair values and the variation of
which is recorded into the profits and losses of the current period, (b) the investments which will be
held to their maturity; (c) loans and the account receivables; and (d) financial assets available for
sale.
(2) Recognition basis and measurements for financial instruments
① The financial assets which are measured at their fair values and the variation of which is
recorded into the profits and losses of the current period
Including transactional financial assets and the financial assets which are designated to be measured
at their fair value when they are initially recognized and of which the variation is recorded into the
profits and losses of the current period;
The financial assets meeting any of the following requirements shall be classified as transactional
financial assets：A. The purpose to acquire the said financial assets is mainly for selling them in the
near future; B. Forming a part of the identifiable combination of financial instruments which are
managed in a centralized way and for which there are objective evidences proving that the
enterprise may manage the combination by way of short-term profit making in the near future; C.
Being a derivative instrument, excluding the designated derivative instruments which are effective
hedging instruments, or derivative instruments to financial guarantee contracts, and the derivative
instruments which are connected with the equity instrument investments for which there is no
quoted price in the active market, whose fair value cannot be reliably measured, and which shall be
settled by delivering the said equity instruments.
The financial assets meeting any of the following requirements shall be designated as financial
assets which are measured at their fair values and the variation of which is recorded into the profits
and losses of the current period for initial recognition: A. the designation can eliminate or
significantly reduce the difference of relevant gains and losses between recognition and
measurement causing from different bases for measurement of financial assets; B. The official
written documents for risk management and investment strategies of the enterprise have clearly
stated that it shall ,manage, evaluate and report to important management personnel based on the
fair value, about the financial assets group or the group of financial assets & liabilities which the
financial assets are belong to.
For the financial assets which are measured at their fair values and the variation of which is
recorded into the profits and losses of the current period shall continue to be measured by fair value,
gains and losses of change in fair value, dividends and interest related with these financial assets
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
should be recorded into gains and losses of current period.
② Held-to-maturity investment
The term "held-to-maturity investment" refers to a non-derivative financial asset with a fixed date
of maturity, a fixed or determinable amount of repo price and which the enterprise holds for a
definite purpose or the enterprise is able to hold until its maturity.
For the held-to-maturity investment adopting actual interest rate method, which is measured at the
post-amortization costs, the profits and losses that arise when such financial assets or financial
liabilities are terminated from recognition, or are impaired or amortized, shall be recorded into the
profits and losses of the current period.
The actual interest rate method refers to the method by which the post-amortization costs and the
interest incomes of different installments or interest expenses are calculated in light of the actual
interest rates of the financial assets or financial liabilities (including a set of financial assets or
financial liabilities). The actual interest rate refers to the interest rate adopted to cash the future cash
flow of a financial asset or financial liability within the predicted term of existence or within a
shorter applicable term into the current carrying amount of the financial asset or financial liability.
When the actual interest rate is determined, the future cash flow shall be predicted on the basis of
taking into account all the contractual provisions concerning the financial asset or financial liability
(the future credit losses shall not be taken into account).and also the various fee charges, trading
expenses, premiums or reduced values, etc., which are paid or collected by the parties to a financial
asset or financial liability contract and which form a part of the actual interest rate.
③ Loans and the accounts receivables
Loans and the accounts receivables refer to non-derivative financial assets, which there is no
quotation in the active market, with fixed recovery cost or recognizable. Financial assets that are
defined as loans and the accounts receivables by the Group including notes receivables, accounts
receivables, interest receivable, dividends receivable and other receivables etc..
Loans and the accounts receivables are made follow-up measurement on the basis of
post-amortization costs employing the effective interest method. Gains or loss arising from the
termination recognition, impairment occurs or amortization shall be recorded into the profits and
losses of the current period.
④ Assets available for sales
Assets available for sales including non-derivative financial asset that has been assigned as assets
available for sales on the initial recognition and financial assets excluded those measured at fair
value and of which the variation into profits and losses of the current period, they are some financial
assets, loans and accounts receivables, held-to-maturity investment.
The Group shall make follow-up measurement to assets available for sales employing fair value.
Gains or loss in fair value changes deducted impairment loss and relevant exchange difference from
monetary financial assets of foreign currency and amortized cost shall be recorded into the profits
and losses of the current period, and shall be recorded into capital reserves as other comprehensive
income and be carried forward when the said financial assets stopped recognition, then it shall be
recorded into the profits and losses of the current period.
Interest receive during the holding of assets available for sales and cash dividends with distribution
announcement by invested companies, it shall be recorded into the profits and losses of the current
period.
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(3) Recognition basis and measurement of financial asset transfers
Financial asset that satisfies one of the following conditions, its recognition shall be stopped: (a) the
contracted right of receiving cash flow of the said financial assets ceases, and (b) the said financial
assets is transferred and nearly all of the risks and rewards related to the ownership is transferred
into the carrying party, and (c) the said asset is transferred, though the corporate neither transferred,
no retain nearly all of the risks and rewards related to the ownership, it gives up the control of the
said asset.
If the corporate neither transferred, no retain nearly all of the risks and rewards related to the
ownership and it does not give up the control of the said financial asset, then the recognition of
relevant asset is recorded according to the extent of its continuous involvement in the transferred
financial asset. The extent of its continuous involvement in the transferred financial asset refers to
the risk the corporate come across with the change in the value of financial asset.
If the transfer of an entire financial asset satisfies the conditions for stopping recognition, the book
value of the transferred financial asset and the sum of consideration received from the transfer, and
the accumulative amount of the changes of the fair value originally recorded in the owner's equities
shall be recorded in the profits and losses of the current period.
If the transfer of partial financial asset satisfies the conditions to stop the recognition, the entire
book value of the transferred financial asset shall, between the portion whose recognition has been
stopped and the portion whose recognition has not been stopped, be apportioned according to their
respective relative fair value, and the book value of the portion whose recognition has been stopped
and he sum of consideration of the portion whose recognition has been stopped, and the portion of
the accumulative amount of the changes in the fair value originally recorded in the owner's equities
which are corresponding to the portion whose recognition has been stopped shall be included into
the profits and losses of the current period.
(4) Termination of recognition of financial liabilities
Only when the prevailing obligations of a financial liability are relieved in all or in part may the
recognition of the financial liability be terminated in all or partly. Where the Group enters into an
agreement with a creditor so as to substitute the existing financial liabilities by way of any new
financial liability, and if the contractual stipulations regarding the new financial liability is
substantially different from that regarding the existing financial liability, it shall terminate the
recognition of the existing financial liability, and shall at the same time recognize the new financial
liability.
Where the recognition of a financial liability is totally or partially terminated, the Group shall
include into the profits and losses of the current period the gap between the carrying amount which
has been terminated from recognition and the considerations it has paid (including the non-cash
assets it has transferred out and the new financial liabilities it has assumed).
(5) Determination of the fair value of main financial assets and financial liabilities
Fair value refers to the price that both parties who are familiar with the situation are willing to
exchange assets or reimburse liabilities. As for the financial assets or financial liabilities for which
there is an active market, the quoted prices in the active market shall be used to determine the fair
values thereof. The quoted prices in the active market refers to the prices available from stock
exchange, broker’s agencies, guilds, pricing organization and etc., which represent the actual
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trading price under equal transaction. Where there is no active market for a financial instrument, the
enterprise concerned shall adopt value appraisal techniques, including the prices adopted by the
parties, who are familiar with the condition, in the latest market transaction upon their own free will,
the current fair value obtained by referring to other financial instruments of the same essential
nature, the cash flow capitalization method and the option pricing model, etc., to determine its fair
value.
(6) Methods for impairment test and withdrawal of impairment provision for financial assets
(excluding accounts receivable)
Except for financial assets that shall be recoded into profits and losses of the current period by
measuring at fair value and variations, the Group shall carry out impairment test, on all balance
sheet days, to book value of other financial assets, where there are objective evidences proving that
a financial asset has been impaired, make provision for impairment for such financial asset.
Where a financial asset measured on the basis of post-amortization costs is impaired, it shall
withdraw the impairment provision by the balance of the current value of the predicted future cash
flow (excluding the loss of future credits not yet occurred) less than the carrying amount of the said
financial asset. If there is any objective evidence proving that the value of the said financial asset
has been restored, and it is objectively related to the events that occur after such loss is recognized,
the impairment-related losses as originally recognized shall be reversed and be recorded into the
profits and losses of the current period.
If there is any objective evidence proving that a sellable financial asset is impaired, the
accumulative losses arising from the decrease of the fair value of the owner’s equity which was
directly included shall be transferred out and recorded into the impairment losses of the current
period. As for the sellable debt instruments whose impairment-related losses have been recognized,
if, within the accounting period thereafter, the fair value has risen and are objectively related to the
subsequent events that occur after the originally impairment-related losses were recognized, the
originally recognized impairment-related losses shall be reversed and be recorded into the profits
and losses of the current period. As for the sellable equity instrument investment whose
impairment-related losses have been recognized, the increase in fair value after balance sheet date
shall be directly recorded into shareholders’ equity.
(7) As for event about reclassifying the undue held-to-maturity investment into available-for-sale
financial assets, the Company shall state the basis of changes in holding purpose or ability
Naught
10. Recognition criteria and withdrawal methods for bad debts provision of accounts
receivable
The Group shall carry out an inspection, on the balance sheet day, on the carrying amount of
receivables. Where there is any objective evidence proving that such receivable has been impaired,
an impairment provision shall be made: ① A serious financial difficulty occurs to the debtor; ②
The debtor breaches any of the contractual stipulations, for example, fails to pay or delays the
payment of interests or the principal, etc.; ③ The debtor will probably become bankrupt or carry
out other financial reorganizations; ④ Other objective evidences indicating that such receivable
has been impaired.
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(1) Bad debt provision for individually significant accounts receivable
The Company defines an account receivable equivalent to or
Judgement basis or monetary standards of provision for bad debts of
above RMB 5 million as an account receivable which is
the individually significant accounts receivable
individually significant.
The Company shall carry out an independent impairment test
on an account receivable which is individually significant.
For a financial asset that is proved to have no signs of
impairment after the independent impairment test, the
Company shall put it into the financial asset group that has
Method of individual provision for bad debts of the individually
the similar credit risk and carry out an impairment test on the
significant accounts receivable
group as a whole. For an account receivable that is proved in
the independent impairment test to have been impaired, the
Company shall not put it into the financial asset group that
has the similar credit risk and carry out an impairment test on
the group as a whole.
(2) Accounts receivable for which bad debt provisions are made on the group basis
Withdrawal method of bad
Name of group debt provision on the group Recognition basis of group
basis
Account age groups Aging analysis method Divided according to ages of accounts receivable.
Divided according to the related-party relation between the
Related-party groups Other method debtor and the Company (usually the Company’s actual
controller and other enterprises controlled by it)
Divided according to the debtor’s reputation, the nature of the
account, safeguard measures, etc. (usually amounts due from the
Risk-free groups Other method government for purchases, reserve funds for employees, deposits
for contracts, accounts receivable arising from guarantee terms,
etc.)
In the groups, adopting aging analysis method to withdraw bad debt provision:
√ Applicable □ Inapplicable
Withdrawal proportion for accounts Withdrawal proportion for other accounts receivable
Age
receivable (%) (%)
Within 1 year (including 1 year) 5% 5%
1-2 years 10% 10%
2-3 years 30% 30%
3-4 years 50% 50%
4-5 years 50% 50%
Over 5 years 100% 100%
In the groups, adopting balance percentage method to withdraw bad debt provision
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□ Applicable √ Inapplicable
In the groups, adopting other methods to withdraw bad debt provision
□ Applicable √ Inapplicable
Name of group Notes of method
Accounts receivable between the parent company and its subsidiaries
Related-party groups included into the consolidated scope are not withdrawn the bad debt
provisions.
Bad debt provisions are made according to the specific identification
Risk-free groups
method.
(3) Accounts receivable with an insignificant single amount but for which the bad debt provision is
made individually
The Group carries out an independent impairment test on an account receivable
which is individually insignificant but has the following feature (for instance,
Reason of individually withdrawing bad debt
receivables over which there exist disputes against the opposite parties or receivables
provision
concerning lawsuits and arbitrations; and receivables of which there are obvious
signs indicating that debtors may not be able to fulfill repayment obligations).
The Group carries out an independent impairment test on an account receivable
which is individually insignificant but has the following feature. If there is any
objective evidence proving that the asset has been impaired (for instance, receivables
over which there exist disputes against the opposite parties or receivables concerning
Withdrawal method for bad debt provision
lawsuits and arbitrations; and receivables of which there are obvious signs indicating
that debtors may not be able to fulfill repayment obligations), the Group recognizes
impairment loss and makes bad-debt provisions according to the difference between
the present value of the asset’s future cash flow and the asset’s book value.
11. Inventory
(1) Classification
The inventories of the Group include raw materials, goods in process, merchandise on hand,
packaging materials, and low value consumables, etc.
(2) Pricing method for outgoing inventories
Pricing method: Weighted average method
Bulk chemical raw materials, goods in process and finished products shall be priced at actual cost,
while cost of sending out inventories shall be carried forward at the weighted average method.
Auxiliary material and packaging materials shall be priced at actual cost and be measured by
adopting planned cost; the difference between the actual cost and planned cost shall be recorded
into materials cost variance when measurement, which materials cost variance allocable thereto
shall be calculated based on materials cost difference rate at the end of month, and the planned cost
of sending out materials shall be adjusted as actual cost.
(3) Recognition basis of net realizable value and withdrawal method of depreciation reserves for
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inventories
Inventories shall be measured whichever is lower in accordance with the cost and the net realizable
value at the period-end. If the cost of inventories is higher than the net realizable value, the
provision for the loss on decline in value of inventories shall be made and be included in the current
profits and losses. If the factors causing any write-down of the inventories have disappeared, the
amount of write-down shall be resumed and be reversed from the provision for the loss on decline
in value of inventories that has been made. The reverse amount shall be included in the current
profits and losses. The net realizable value refers to in the daily business activity the amount after
deducting the estimated cost of completion, estimated sale expense and relevant taxes from the
estimated sale price of inventories.
(4) Inventory system for inventories:
Inventory system: Perpetual inventory system
The inventory system for inventories is perpetual inventory system.
(5) Amortization method of the low-value consumption goods and packing articles
Low-value consumption goods
Amortisation method: one-off amortization method
Low value consumables shall be recoded at actual cost and be amortized by employing the one-off
amortization method when claiming.
Packing articles
Amortisation method: other
Packaging materials shall be priced at actual cost and be measured by adopting planned cost; the
difference between the actual cost and planned cost shall be recorded into materials cost variance
when measurement, which materials cost variance allocable thereto shall be calculated based on
materials cost difference rate at the end of month, and the planned cost of sending out materials
shall be adjusted as actual cost.
12. Long-term equity investments
(1) Recognition of investment costs
As for long-term equity investments acquired by enterprise merger, if the merger is under the same
control, the share of the book value of the owner’s equity of the merged enterprise, on the date of
merger, is regarded as the initial cost of the long-term equity investment, and if the merger is not
under the same control, the sum of paid assets, occurred or assumed liabilities, and issued equity
securities by the purchasing party are included into costs of enterprise merger. Intermediary
expenses, such as the expenses for audit, assessment, and legal services, along with other relevant
administration fee, shall be recorded into the profits and losses of the current period. Transaction
costs arising from the issuance of equity securities or debt securities as merger consideration of the
purchasing party shall be recorded into the initially recognized amount of equity securities or debt
securities.
Other equity investments, except for the aforesaid long-term equity investments acquired by
enterprises merger, are initially measured according to costs, which can, in consideration of
different ways to obtain long-term equity investments, be respectively recognized by amount of
cash payment actually paid by the Group, fair value of equity securities issued by the Group, value
agreed upon investment contracts or investment agreements, fair value or original book value of
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surrendered assets in transactions of non-currency assets, and fair value of the long-term equity
investment itself. Costs, taxes and other necessary expenses directly relevant to the acquirement of
long-term equity investments are also recorded onto investment costs.
(2) Subsequent measurement and recognition method of gains and losses
For the long-term equity investments which the Company have no joint control or significant
influence over invested entities, and there is no offer in the active market and the fair value cannot
be reliably measured, shall be accounted by cost method. Long-term equity investments with joint
control or significant influence over invested entities shall be accounted by equity method.
Long-term equity investments, which have no control, joint control or significant influence over
invested entities, nevertheless of which the fair value can be reliably measured, shall be accounted
as financial assets available for sale or financial assets recognized with the fair value and the change
recognized in current gains and losses.
Besides, long-term equity investments that can implement control over invested entities are
accounted by cost method in financial statements of the Company.
① Long-term equity investments accounted by cost method
With the employment of cost method, long-term equity investments shall be valuated on the basis of
initial investment cost. Current investment income, except for actually paid amount during the
investment, and cash dividends or profits that have been declared but not yet been granted included
in the consideration, shall be ascertained in accordance with enjoyed cash dividends or profits
declared and granted by invested entities.
② Long-term equity investments accounted by equity method
With the employment of equity method, the initial investment cost of long-term equity investment
shall not be adjusted if the initial investment cost of long-term equity investment exceeds the share,
which should be enjoyed, of fair value of identifiable net assets of invested entities. Cost of
long-term equity investment shall be adjusted if the initial investment cost is less than the share,
which should be enjoyed, of fair value of identifiable net assets of invested entities, and the balance
between the two shall be recorded into profit or loss in the period in which it is incurred.
With the employment of equity method, profit or loss in the period in which it is incurred is the
share, which should be enjoyed or shared, of net gains and losses realized by invested entities in the
current year. When recognizing the share, which should be enjoyed, of net gains and losses of
invested entities, the recognition shall be implemented on the basis of fair value of all identifiable
assets of invested entities during the investment and after the adjustment of net profit of invested
entities during the account period with the accordance of accounting policies of the Group. As for
gains and losses of unrealized internal transactions among associated enterprises, contractual
enterprises and the Group, the part belonging to the Group after calculating by shareholding
proportion shall be offset, and the investment gains and losses shall be thus recognized on that basis.
Nevertheless, losses, which belong to impairment losses of transferred assets in line with provisions
stipulated in the Accounting Standards for Enterprises No. 8 - Asset Impairment, of realized internal
transactions between invested entities and the Group shall not be offset. As for other integrated
incomes of invested entities, the book value of long-term equity investments shall be
correspondently adjusted and recognized as other investment incomes，which shall thus be recorded
into capital reserves.
When recognizing the incurred net losses, which should be shared, of invested entities, the limit
shall be the down-to-zero amount of write-down of book value of long-term equity investments and
other long-term equity essentially forming net investment over invested entities. Besides, if the
Group has any liability of undertaking extra losses over invested entities, then the estimated debts
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shall be recognized in compliance with projected undertaken duties and recorded into gains and
losses of investment at the current period. If the invested entity realized net profits in subsequent
period, then the Group shall resume recognition of the shared amount of incomes after making up
unrecognized shared amount of losses with the shared amount incomes.
For the long-term equity investment on joint venture and associate held by the Company before
initially adopting the new accounting standard on 1 Jan. 2008, if there is debit balance of equity
investment relevant to such investment, which shall be recognized into profit or loss in the period in
which it is incurred with the amortised amount by straight-line method during the remaining period.
③ Acquisition of minority equity
During the preparation of consolidated financial statements, capital reserves shall be adjusted in
light of balance between long-term equity investments, which are newly increased because of the
purchase of minority stakes, and the share of net assets of subsidiaries, which should be enjoyed and
has been sustainably calculated since the acquisition date (or merger date) in accordance with newly
increased shareholding proportion. Retained earnings shall be adjusted if capital reserves are
insufficient to dilute.
④ Disposal of long-term equity investments
In consolidated financial statements, under the circumstance of keeping control power, the parent
company shall partially dispose long-term equity investments, and the balance between the disposed
price and the enjoyed net assets of subsidiaries correspondent to disposed long-term equity
investment shall be recorded into owners’ equity. If the partial disposal of parent company over
long-term equity investments of subsidiaries results in the loss of control over subsidiaries, in that
circumstance, it shall be managed according to relevant accounting policies stated in the Preparation
Method of Consolidated Financial Statements in Note IV. 4. (2).
As for disposal of long-term equity investment under other circumstances, the balance between
book value of disposed equity and its actually acquired price shall be included into profit or loss in
the period in which it is incurred. As for long-term equity investments with the employment of
equity method, other part of integrated incomes originally included in owners’ equity shall be
transferred to profit or loss in the period in which it is incurred in accordance with correspondent
proportion during the disposal. As for residual equity, it shall be recognized as long-term equity
investments or other relevant financial assets according to the book value, and shall be subsequently
measured according to accounting policies of the aforesaid long-term equity investments or
financial assets. Residual equity concerning accounting method transferred from cost method to
equity method shall be retrospectively restated and adjusted.
(3) Recognition basis for joint control and significant influence over invested entities
The term "control" means having the power to decide an enterprise's financial and operating policy
and obtain benefits from its business activities. The term "joint control" refers to the control over an
economic activity in accordance with the contracts and agreements, which does not exist unless the
investing parties of the economic activity with one an assent on sharing the control power over the
relevant important financial and operating decisions. The term "significant influences" refers to the
power to participate in making decisions on the financial and operating policies of an enterprise, but
not to control or do joint control together with other parties over the formulation of these policies.
When ascertaining whether or not it is able to control or have significant influences on an invested
entity, potential factors concerning the voting rights, such as investing enterprises, current
convertible corporate bonds, and current executable warrants of invested entities etc. have been
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taken into full consideration.
(4) Impairment test method and withdrawal method of impairment provision
The Group shall check out whether there is any sign of impairment of long-term equity investments
on each balance sheet date. Where any evidence shows that there is possible assets impairment, the
recoverable amount of the assets shall be estimated. If the recoverable amount of the asset is less
than its book value, then asset impairment provision will be withdrawn in line with the balance and
recorded into profit or loss in the period in which it is incurred.
Once the impairment losses of long-term equity investments are recognized, they can’t be reversed
during the subsequent accounting period.
13. Investment real estates
The term "investment real estates" refers to the real estate held for generating rent and/or capital
appreciation. Investment real estates of the Group include the right to use any land which has
already been rented; the right to use any land which is held and prepared for transfer after
appreciation; and the right to use any building which has already been rented.
The initial measurement of the investment real estate shall be made at its cost. Subsequent
expenditures incurred for an investment real estate is included in the cost of the investment real
estate when it is probable that economic benefits associated with the investment real estate will flow
to the Group and the cost can be reliably measured, otherwise the expenditure is recognised in profit
or loss in the period in which they are incurred.
The Group shall make a follow-up measurement to the investment real estates by employing the
cost pattern on the date of the balance sheet. An accrual depreciation or amortization shall be made
for the investment real estates in the light of the accounting policies of the use right of buildings or
lands.
As for impairment test method and withdrawal method of impairment provision of investment real
estates, the Group shall judge whether there is sign of impairment on the balance sheet date. Where
any evidence shows that there is possible assets impairment, the recoverable amount of the assets
shall be estimated. When impairment test result shows that the recoverable amount of the asset is
lower than its book value, impairment provision shall be withdrawn in accordance with the balance
and recorded into impairment loss.
When owner-occupied real estate or inventories are changed into investment real estate or
investment real estate is changed into owner-occupied real estate, whose book value prior to the
change shall be the entry value after the change?
When an investment real estate is changed to an owner-occupied real estate, it is transferred to fixed
assets or intangible assets at the date of such change. When an owner-occupied real estate is
changed to be held to earn rental or for capital appreciation, the fixed asset or intangible asset is
transferred to investment real estate at the date of such change. If the fixed asset or intangible asset
is changed into investment real estate measured by adopting the cost pattern, whose book value
prior to the change shall be the entry value after the change; if the fixed asset or intangible asset is
changed into investment real estate measured by adopting the fair value pattern, whose fair value on
the date of such change shall be the entry value after the change
An investment real estate is derecognised on disposal or when the investment real estate is
permanently withdrawn from use and no future economic benefits are expected from its disposal.
The amount of proceeds on sale, transfer, retirement or damage of an investment real estate less its
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carrying amount and related taxes and expenses is recognised in profit or loss in the period in which
it is incurred.
14. Fixed assets
(1) Conditions for recognition of fixed assets
The term "fixed assets" refers to the tangible assets that simultaneously possess the features as
follows: (a) they are held for the sake of producing commodities, rendering labor service, renting or
business management; and (b) their useful life is in excess of one fiscal year.
(2) Recognition basis and pricing method for fixed assets gained from finance lease
The "finance lease" shall refer to a lease that has transferred in substance all the risks and rewards
related to the ownership of an asset. The ownership of it may or may not eventually be transferred.
In calculating the depreciation of an asset gained from finance lease, the lessee should adopt the
depreciation policy for the fixed assets which are owned by the lessee. If it is reasonable to be
certain that the lessee will obtain the ownership of the leased asset when the lease term expires, the
leased asset shall be fully depreciated over its useful life. If it is not reasonable to be certain that the
lessee will obtain the ownership of the leased asset at the expiry of the lease term, the leased asset
shall be fully depreciated over the shorter one of the lease term or its useful life.
(3) Depreciation methods for various fixed assets
The initial measurement of a fixed asset shall be made at its cost with the consideration of the effect
of expected discard expenses. From the next month of bringing the fixed asset to the expected
conditions for use, it shall be made the depreciation by adopting the straight-line method during its
useful life. The useful life, expected net salvage value and annual depreciation ratio of various fixed
assets are as follows:
The categories Estimated useful life (years) Residual value (%) Annual depreciation rate (%)
Houses and buildings 15-24 4--6.53
Machinery 3-15 6.4--32.67
Electronic devices 9-18 4% 5.33--10.67
Vehicles 9 2% 10.89
(4) Testing method of impairment and withdrawal method of provision for impairment on fixed
assets
The Group shall judge whether there is sign of impairment on the balance sheet date. Where any
evidence shows that there is possible assets impairment, the Group shall estimate the recoverable
amount of the assets and make relevant impairment test.
When impairment test result shows that the recoverable amount of the asset is lower than its book
value, impairment provision shall be withdrawn in accordance with the balance and recorded into
impairment loss. The recoverable amount shall be determined on the basis of the higher one of the
net amount of the fair value of the asset minus the disposal expenses and the current value of the
expected future cash flow of the asset. Fair value of the asset shall be determined in light of the
price as stipulated in the sales agreement in the fair transaction. Where there is no sales agreement
but there is an active market of assets, the fair value shall be determined according to the price
bidden by the buyer of the asset. Where there is no sales agreement and no active market of assets,
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the fair value shall be estimated in light of the best information available. The disposal expenses
shall include the relevant legal expenses, relevant taxes, truckage as well as the direct expenses for
bringing the assets into a marketable state. The current value of the expected future cash flow of an
asset shall be determined by the discounted cash with an appropriate discount rate, on the basis of
the expected future cash flow generated during the continuous use or final disposal of an asset.
Impairment provision of the asset shall be calculated and determined on the basis of single item
asset. Where it is difficult to do so, the enterprise shall determine the recoverable amount of the
group assets on the basis of the asset group to which the asset belongs. The term "group assets”
refers to a minimum combination of assets that can independently generate the flow-in cash.
Once the impairment losses of the aforesaid assets are recognized, they can’t be reversed during the
subsequent accounting period.
(5) Other explanations
Subsequent expenditures incurred for a fixed asset are included in the cost of the fixed asset when it
is probable that economic benefits associated with the fixed asset will flow to the Group and its cost
can be reliably measured. The carrying amount of those parts that are replaced is derecognized and
all other subsequent expenditures are recognised in profit or loss in the period in which it is
incurred.
The amount of proceeds on sale, transfer, retirement or damage of a fixed asset net less its carrying
amount and related taxes and expenses is recognised in profit or loss in the period in which it is
incurred.
The Group will check the useful life, expected net salvage value and depreciation method of fixed
assets at least at the end of year, and there is any change, the change will be treated as the change of
accounting estimation.
15. Construction in progress
(1) Categories of construction in progress
Construction in progress of the Group includes self-operating project and construction contracted.
(2) Criteria and time point of construction in progress being carried forward as fixed assets
Time point of construction in progress being carried forward as fixed assets shall be recognized at
the time point that the construction reaches estimated usable status.
(3) Impairment test method and withdrawal method for impairment provision of construction in
progress
The Group shall judge whether there is sign of impairment on the balance sheet date. Where any
evidence shows that there is possible assets impairment, the Group shall estimate the recoverable
amount of the assets and make relevant impairment test.
When impairment test result shows that the recoverable amount of the asset is lower than its book
value, impairment provision shall be withdrawn in accordance with the balance and recorded into
impairment loss. The recoverable amount shall be determined on the basis of the higher one of the
net amount of the fair value of the asset minus the disposal expenses and the current value of the
expected future cash flow of the asset. Fair value of the asset shall be determined in light of the
price as stipulated in the sales agreement in the fair transaction. Where there is no sales agreement
but there is an active market of assets, the fair value shall be determined according to the price
bidden by the buyer of the asset. Where there is no sales agreement and no active market of assets,
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the fair value shall be estimated in light of the best information available. The disposal expenses
shall include the relevant legal expenses, relevant taxes, truckage as well as the direct expenses for
bringing the assets into a marketable state. The current value of the expected future cash flow of an
asset shall be determined by the discounted cash with an appropriate discount rate, on the basis of
the expected future cash flow generated during the continuous use or final disposal of an asset.
Impairment provision of the asset shall be calculated and determined on the basis of single item
asset. Where it is difficult to do so, the enterprise shall determine the recoverable amount of the
group assets on the basis of the asset group to which the asset belongs. The term "group assets”
refers to a minimum combination of assets that can independently generate flow-in cash.
Once the impairment losses of the aforesaid assets are recognized, they can’t be reversed during the
subsequent accounting period.
16. Borrowing costs
(1) Recognition principles for capitalization of borrowing costs
When the borrowing costs can be directly attributable to the construction or production of assets
eligible for capitalization, and the asset disbursements or the borrowing costs have already incurred,
and the construction or production activities which are necessary to prepare the asset for its
intended use or sale have already started, the capitalization of borrowing costs begins. When the
asset eligible for capitalization under acquisition and construction or production is ready for the
intended use or sale, the capitalization of the borrowing costs shall be ceased. Other borrowing
costs shall be recognized as expenses when incurred.
(2) Capitalization period of borrowing costs
When the asset eligible for capitalization under acquisition and construction or production is ready
for the intended use or sale, the capitalization of the borrowing costs shall be ceased. The borrowing
costs, which occurred after the asset eligible for capitalization under acquisition and construction or
production being ready for the intended use or sale, shall be recognized as expenses with the
occurring amount, and then recorded into current gains and losses.
(3) Period for ceasing capitalization of borrowing costs
Where the construction or production of asset eligible for capitalization is interrupted abnormally
and the interruption period lasts for more than 3 months, the capitalization of the borrowing costs
shall be suspended till the construction or production of the asset restarts.
(4) Calculation method of capitalized amount of borrowing costs
The amount of interests shall be capitalized in light of the actual cost incurred of the specially
borrowed loan at the current period minus the income of interests earned on the unused borrowing
loans as a deposit in the bank or as a temporary investment. The to-be-capitalized amount shall be
determined by multiplying the weighted average asset disbursement of the part of the accumulative
asset disbursements minus the general borrowing by the capitalization rate of the general borrowing
used. The capitalization rate shall be calculated and determined in light of the weighted average
interest rate of the general borrowing.
17. Biological assets
Naught
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18. Oil-gas assets
Naught
19. Intangible assets
(1) Pricing method of intangible assets
Intangible assets are initially measured according to its costs. Expenses relating to intangible assets
shall be recorded into cost of intangible assets if relevant economic profit is much likely to flow
into the Group and its cost can be reliably measured. Except for that, expenses of other items shall
be recorded into profit or loss in the period in which it is incurred when incurred.
(2) Estimated useful life of intangible assets with limited useful life
Intangible assets with limited service lives are averagely amortized by deducting the expected net
salvage value and the withdrawn accumulative amount of provision for the impairment from the
original value on a straight-line basis within their expected service lives beginning from the start of
its usage. At the end of the period, service lives and amortization method for intangible assets with
limited service lives shall be checked. If there’s any change, the change shall be disposed as a
change of the accounting estimates.
Item Estimated useful life Basis
Land use right 50 years Useful life listed in the land use right certificate
Software and special
Over 5 years Useful life predicted by the law or contract
technologies
(3) Judgment basis of intangible assets with uncertain useful life
Only if there is valid evidence showing the useful life of an intangible asset can’t be reasonably
estimated according to the available information, the intangible asset can be recognized as
intangible asset with uncertain useful life.
(4) Withdrawal of impairment provision of intangible assets
The Group shall judge whether there is sign of impairment on the balance sheet date. Where any
evidence shows that there is possible assets impairment, the Group shall estimate the recoverable
amount of the assets and make relevant impairment test. Intangible assets of good will or with
uncertain service lives, as well as intangible assets failing to reach the condition for use, shall be
subject to impairment tests every year, no matter whether there is any sign of possible assets
impairment.
When impairment test result shows that the recoverable amount of the asset is lower than its book
value, impairment provision shall be withdrawn in accordance with the balance and recorded into
impairment loss. The recoverable amount shall be determined on the basis of the higher one of the
net amount of the fair value of the asset minus the disposal expenses and the current value of the
expected future cash flow of the asset. Fair value of the asset shall be determined in light of the
price as stipulated in the sales agreement in the fair transaction. Where there is no sales agreement
but there is an active market of assets, the fair value shall be determined according to the price
bidden by the buyer of the asset. Where there is no sales agreement and no active market of assets,
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the fair value shall be estimated in light of the best information available. The disposal expenses
shall include the relevant legal expenses, relevant taxes, truckage as well as the direct expenses for
bringing the assets into a marketable state. The current value of the expected future cash flow of an
asset shall be determined by the discounted cash with an appropriate discount rate, on the basis of
the expected future cash flow generated during the continuous use or final disposal of an asset.
Impairment provision of the asset shall be calculated and determined on the basis of single item
asset. Where it is difficult to do so, the enterprise shall determine the recoverable amount of the
group assets on the basis of the asset group to which the asset belongs. The term "group assets”
refers to a minimum combination of assets that can independently generate the flow-in cash.
When making an impairment test, the carrying value of the goodwill presented separately in
financial statements shall be distributed to the asset group or combination of asset groups that can
benefit from the synergy effect of enterprise merger. If the impairment test shows that the
recoverable amount of the asset groups or combinations of asset groups containing good will is
lower than their carrying value, then the correspondent impairment loss shall be recognized. The
amount of the impairment loss shall first charge against the carrying value of the headquarter' assets
and good will which are apportioned to the asset group or combination of asset groups, then charge
it against the carrying value of other assets in proportion to the weight of other assets in the asset
group or combination of asset groups with the good will excluded.
Once the impairment losses of the aforesaid assets are recognized, they can’t be reversed during the
subsequent accounting period.
(5) Criteria of separating the research phase and development phase of internal R&D project
The expenditures for internal research and development projects of an enterprise shall be classified
into research expenditures and development expenditures.
(6) Calculation of the expenditures of internal R&D project
The expenditures for internal research and development projects of an enterprise shall be classified
into research expenditures and development expenditures.
The research expenditures shall be recorded into the profit or loss for the current period.
The development expenditures shall be confirmed as intangible assets when they satisfy the
following conditions simultaneously, and shall be recorded into profit or loss for the current period
when they don’t satisfy the following conditions.
① It is feasible technically to finish intangible assets for use or sale;
② It is intended to finish and use or sell the intangible assets;
③ The usefulness of methods for intangible assets to generate economic benefits shall be proved,
including being able to prove that there is a potential market for the products manufactured by
applying the intangible assets or there is a potential market for the intangible assets itself or the
intangible assets will be used internally;
④ It is able to finish the development of the intangible assets, and able to use or sell the intangible
assets, with the support of sufficient technologies, financial resources and other resources;
⑤ The development expenditures of the intangible assets can be reliably measured.
As for expenses that can’t be identified as research expenditures or development expenditures, the
occurred R & D expenses shall be all included in current profits and losses.
20. Amortization method of long-term deferred expenses
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The Group’s long-term deferred expenses are measured by the actual cost, and averagely amortized
over the beneficiary period. As for the long-term deferred expenses that can’t benefit for the future
accounting period, its amortized value shall be totally recorded into current gains and losses.
21. Assets transfer with repurchasing conditions
Naught
22. Estimated liabilities
(1) Recognition criteria of estimated liabilities
The obligation pertinent to a contingent event shall be recognized as an estimated liability when the
following conditions are satisfied simultaneously: (1) That obligation is a current obligation of the
Group; (2) It is likely to cause any economic benefit to flow out of the Group as a result of
performance of the obligation; (3) The amount of the obligation can be measured in a reliable way.
(2) Measurement of estimated liabilities
On the balance sheet date, with full consideration of the risks, uncertainty, time value of money, and
other factors pertinent to the contingent event, the estimated liabilities shall be initially measured in
accordance with the best estimate of the necessary expenses for the performance of the current
obligation.
When all or some of the expenses necessary for the liquidation of an estimated liability of the
Group is expected to be compensated by a third party, the compensation should be separately
recognized as an asset only when it is virtually certain that the reimbursement will be obtained. The
amount recognized for the reimbursement should not exceed the book value of the estimated
liability.
23. Share-based payment and equity instruments
Naught
24. Repurchase of shares of the Company
Naught
25. Revenues
(1) Criteria for recognition time of revenue from selling goods
Revenues from selling goods are recognized when the following conditions are met simultaneously:
1) the significant risks and rewards of ownership of the goods have been transferred to the buyer by
the Group; 2) the Group retains neither continuous management right that usually keeps relation
with the ownership nor effective control over the sold goods; 3) the relevant amount of revenues
can be measured in a reliable way; 4) the relevant economic benefits may flow into the enterprise;
and 5) the relevant costs incurred or to be incurred can be measured in a reliable way.
(2) Recognition basis of assignment of right to use assets revenue
When the economic benefits relevant to the assignment of right to use assets may flow into the
enterprise and the amount of revenue can be measured in a reliable way, the Company shall
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
recognize relevant revenue.
(3) Recognition basis of revenues from providing labor services
① Recognition basis of revenues from providing labor services on the condition that the Group can
reliably estimate the outcome of a transaction concerning the labor services it provides. If the Group
can, on the date of the balance sheet, reliably estimate the outcome of a transaction concerning the
labor services it provides, it recognizes the revenues from providing services employing the
percentage-of-completion method. And the outcome of a transaction concerning the providing of
labor services can be measured in a reliable way when the following conditions are met
simultaneously: 1) the amount of revenues can be measured in a reliable way; 2) the relevant
economic benefits are likely to flow into the enterprise; 3) the schedule of completion under the
transaction can be confirmed in a reliable way; and 4) the costs incurred or to be incurred in the
transaction can be measured in a reliable way.
② Recognition standards of revenues from providing labor services on the condition that the
Company can not reliably estimate the outcome of a transaction concerning the labor services it
provides
If the Group can not, on the date of the balance sheet, measure the result of a transaction concerning
the providing of labor services in a reliable way, it is to be conducted in accordance with the
following circumstances, respectively:
A. If the cost of labor services incurred is expected to be fully compensated, the revenues from
providing labor services are recognized in accordance with the amount received or expected to be
received, and the cost of labor services incurred is carried forward;
B. If the cost of labor services incurred is expected to be partially compensated, the revenues from
providing labor services are recognized in accordance with the compensated amount, and the cost of
labor services incurred is carried forward;
C. If the cost of labor services incurred is expected to be fully uncompensated, the cost incurred is
included in the current profits and losses, and no revenue from the providing of labor services may
be recognized.
(4) Recognition basis and method for the schedule of contracted project when recognizing the
revenue from providing labour services and construction contract by percentage-of-completion
method
The method for recognizing the schedule of completion in percentage-of-completion method:
it’s decided by the proportion of the costs incurred against the estimated total costs.
26. Government Subsidies
(1) Types
A government subsidy means the monetary or non-monetary assets obtained free by the Group from
the government, but excluding the capital invested by the government as the owner of the enterprise.
Government subsidies consist of the government subsidies pertinent to assets and government
subsidies pertinent to income.
(2) Accounting treatment method
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If a government subsidy is a monetary asset, it shall be measured in the light of the received or
receivable amount. If a government subsidy is a non-monetary asset, it shall be measured at its fair
value. If its fair value cannot be obtained in a reliable way, it shall be measured at its nominal
amount. The government subsidies measured at their nominal amounts shall be directly included in
the current profits and losses.
The government subsidies pertinent to assets shall be recognized as deferred income, equally
distributed within the useful lives of the relevant assets, and included in the current profits and
losses. The government subsidies pertinent to incomes used for compensating the related future
expenses or losses shall be recognized as deferred income and shall be included in the current
profits and losses during the period when the relevant expenses are recognized; or those subsidies
used for compensating the related expenses or losses shall be directly included in the current profits
and losses.
If it is necessary to refund any government subsidy which has been recognized, it shall be
treated respectively in accordance with the circumstances as follows: 1) If there is the deferred
income concerned, the book balance of the deferred income shall be offset against, but the
excessive part shall be included in the current profits and losses; and 2) If there is no deferred
income concerned to the government subsidy, it shall be directly included in the current profits and
losses.
27. Deferred income tax assets / Deferred income tax liabilities
(1) Recognition basis of deferred income tax assets
The deferred income tax assets are recognized in accordance with the difference (temporary
difference) between the tax bases and the book value. As for the deductible losses that can deduct
the taxable income in the future by the stipulations of tax law, relevant deferred income tax assets
shall be recognized. As for the temporary difference arising from the initial recognition of assets or
liabilities in the non-enterprise combination which neither affects the accounting profits nor the
deductable losses, relevant deferred income tax assets shall not be recognized. On the balance sheet
date, the deferred income tax assets shall be measured at the tax rate applicable to the period during
which the relevant assets are expected to be recovered. The deferred income tax assets shall be
recognized to the extent of the amount of the taxable income which it is most likely to obtain and
which can be deducted from the deductible temporary difference, deductible losses and taxes
deducted.
(2) Recognition basis of deferred income tax liabilities
The deferred income tax liabilities are recognized in accordance with the difference (temporary
difference) between the tax bases and the book value. As for the temporary difference arising from
the initial recognition of goodwill, relevant deferred income tax liabilities shall not be recognized.
As for the temporary difference arising from the initial recognition of liabilities in the
non-enterprise combination which neither affects the accounting profits nor the taxable income,
relevant deferred income tax liabilities shall not be recognized. On the balance sheet date, the
deferred income tax liabilities shall be measured at the tax rate applicable to the period during
which the relevant liabilities are expected to be settled.
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
28. Operating lease and financial lease
(1) Accounting treatments of operating lease
Business of operating leases recorded by the Group as the lessee:
The rent expenses from operating leases shall be recorded by the lessee in the relevant asset costs or
the profits and losses of the current period by using the straight-line method over each period of the
lease term. The initial direct costs shall be recognized as the profits and losses of the current period.
The contingent rents shall be recorded into the profits and losses of the current period in which they
actually arise.
Business of operating leases recorded by the Group as the lessor:
The rent incomes from operating leases shall be recognized as the profits and losses of the current
period by using the straight-line method over each period of the lease term. The initial direct costs
of great amount shall be capitalized when incurred, and be recorded into current profits and losses
in accordance with the same basis for recognition of rent incomes over the whole lease term. The
initial direct costs of small amount shall be recorded into current profits and losses when incurred.
The contingent rents shall be recorded into the profits and losses of the current period in which they
actually arise.
(2) Accounting treatments of financial lease
Business of finance leases recorded by the Group as the lessee:
On the lease beginning date, the Group shall record the lower one of the fair value of the leased
asset and the present value of the minimum lease payments on the lease beginning date as the
entering value in an account, recognize the amount of the minimum lease payments as the entering
value in an account of long-term account payable, and treat the balance between the recorded
amount of the leased asset and the long-term account payable as unrecognized financing charges.
Besides, the initial direct costs directly attributable to the leased item incurred during the process of
lease negotiating and signing the leasing agreement shall be recorded in the asset value of the
current period. The balance through deducting unrecognized financing charges from the minimum
lease payments shall be respectively stated in long-term liabilities and long-term liabilities due
within 1 year.
Unrecognized financing charges shall be adopted by the effective interest rate method in the lease
term, so as to calculate and recognize current financing charges. The contingent rents shall be
recorded into the profits and losses of the current period in which they actually arise.
Business of finance leases recorded by the Group as the lessor:
On the beginning date of the lease term, the Group shall recognize the sum of the minimum lease
receipts on the lease beginning date and the initial direct costs as the entering value in an account of
the financing lease values receivable, and record the unguaranteed residual value at the same time.
The balance between the sum of the minimum lease receipts, the initial direct costs and the
unguaranteed residual value and the sum of their present values shall be recognized as unrealized
financing income. The balance through deducting unrealized financing incomes from the finance
lease accounts receivable shall be respectively stated in long-term claims and long-term claims due
within 1 year.
Unrecognized financing incomes shall be adopted by the effective interest rate method in the lease
term, so as to calculate and recognize current financing revenues. The contingent rents shall be
recorded into the profits and losses of the current period in which they actually arise.
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
(3) Accounting treatments for those sold and leasing-back
Naught
29. Assets held for sale
Naught
30. Capitalization of assets
Naught
31. Hedging accounting
Naught
32. Changes in main accounting policies and estimates
Were the main accounting policies or estimates changed during the reporting period?
□Yes √No
(1) Change of accounting policies
Were the main accounting policies changed during the reporting period?
□Yes √No
(2) Change of accounting estimates
Were the main accounting estimates changed during the reporting period?
□Yes √No
33. Correction of previous accounting errors
Was any accounting error made in previous periods discovered in the reporting period?
□Yes √No
(1) Retrospective restatement method
Was any previous accounting error adopting retrospective restatement method discovered in the
reporting period?
□Yes √No
(2) Prospective application method
Was any previous accounting error adopting prospective application method discovered in the
reporting period?
□Yes √No
34. Other main accounting policies and estimates as well as compilation method of financial
statements
V. Taxation
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
1. Main taxes and tax rate
Category of taxes Tax basis Tax rate
VAT Taxable income 13% 17%
Business tax Taxable income 5%
Urban maintenance and construction tax Taxable circulating tax 5%， 7%
Enterprise income tax Taxable income 25%
Education surcharge Taxable circulating tax 3%
Income tax rate of each subsidiary and branch factory
The income tax rates adopted by each subsidiary and branch factory
2. Tax preference and official documents
Naught
3. Other notes
VI. Business combination and consolidated financial statement
1. Subsidiaries
Five subsidiaries were included into the consolidated scope of the Group in 2012.
(1) Subsidiaries obtained by establishment and investment
Unit: RMB Yuan
Balance
of
parent
Actual compan
amount The The Include y’s
of Other proporti proporti d in Deducti equity
Register Minorit
Subsidia Register Busines Busines investm essential on of on of consolid ble after
Type ed y
ries ed place s nature s scope ents at investm holding voting ated minority deductin
capital interest
the ent shares rights stateme interests g the
period-e （%） （%） nt differen
nd ce that
loss of
minority
interests
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
exceed
equity
obtained
by
minority
sharehol
ders
Sanonda Wholly-
(Jingzho owned Producti
u) subsidia on of
Pesticid ry Jingzho Manufa 30,000, pesticid 30,413,
100% 100% Yes
e & u cturing 000.00 e and 700.00
Chemic interme
al Co., diate
Ltd.
Wholly- Import
Hubei owned and
Sanonda subsidia export
Foreign ry Jingzho 10,000, of 11,993,0
Trading 100% 100% Yes
Trading u 000.00 pesticid 30.00
Co., e and
Ltd. interme
diate
Hubei Wholly-
Sanonda owned
Producti
Tianme subsidia
on and
n ry Tianme Manufa 30,000, 21,296,
sale of 100% 100% Yes
Agroche n cturing 000.00 323.32
pesticid
mical
e
Co.,
Ltd.
Jingzho Controll
u ed Producti
Longhu subsidia on and
a ry Jingzho Manufa 5,000,0 sale of 3,250,0 4,471,1
65% 65% Yes
Petroch u cturing 00.00 chemica 00.00 82.51
emicals l
Co., products
Ltd.
Other notes to subsidiaries obtained by establishment and investment:
(2) Subsidiary through business combination under the same control
Unit: RMB Yuan
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Balance
of
parent
compan
y’s
equity
after
Actual
deductin
amount The The Include
g the
of Other proporti proporti d in Deducti
Register Minorit differen
Subsidia Register Busines Busines investm essential on of on of consolid ble
Type ed y ce that
ries ed place s nature s scope ents at investm holding voting ated minority
capital interest loss of
the ent shares rights stateme interests
minority
period-e （%） （%） nt
interests
nd
exceed
equity
obtained
by
minority
sharehol
ders
Jingzho Producti
u on and
Controll
Hongxia sale of
ed Jingzho Manufa 40,000, 37,619, 332,434
ng chemica 98.5% 98.5% Yes
subsidia u cturing 000.00 905.41 .02
Chemic l raw
ry
als Co., material
Ltd. s
Other notes to subsidiaries obtained through business combination under the same control:
(3) Subsidiary through business combination not under the same control
Unit: RMB Yuan
Balance
Actual of
amount The The Include parent
of Other proporti proporti d in Deducti compan
Register Minorit
Subsidia Register Busines Busines investm essential on of on of consolid ble y’s
Type ed y
ries ed place s nature s scope ents at investm holding voting ated minority equity
capital interest
the ent shares rights stateme interests after
period-e （%） （%） nt deductin
nd g the
differen
80
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
ce that
loss of
minority
interests
exceed
equity
obtained
by
minority
sharehol
ders
Other notes to subsidiaries obtained through business combination not under the same control:
2. Special purpose entities or operating entities with control right formed by entrusted
operation or lease
Unit: RMB Yuan
Closing balance of assets and liabilities affirmed in consolidated
Name Business with the Company
statement
Other note about Special purpose entities or operating entities with control right formed by
entrusted operation or lease
3. Explanation on changes in consolidated scope
Explanation on changes in consolidated scope:
□ Applicable √ Inapplicable
4. Subsidiaries that newly combined into and not combined into consolidation scope in the
reporting period
Naught
5. Business combination under same control during the reporting period
Naught
6. Business combination not under same control during the reporting period
Naught
7. Subsidiaries reduced by selling equities without control right during the reporting period
Naught
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
8. The counter purchases in the reporting period
Naught
9. Mergers in the reporting period
Naught
10. Exchange rates of major items in financial statements for foreign entities
Naught
(VII) Notes on major items in consolidated financial statements of the Company
1. Monetary funds
Unit: RMB Yuan
Closing balance Opening balance
Item Amount in Exchange Amount in Exchange
Amount in RMB Amount in RMB
foreign currency rate foreign currency rate
Cash: -- -- 21,558.81 -- -- 1,347.21
RMB -- -- 21,558.81 -- -- 1,347.21
Bank deposit: -- -- 549,700,926.87 -- -- 175,180,018.56
RMB -- -- 538,465,380.55 -- -- 168,531,626.60
USD 1,818,432.09 6.1787 11,235,546.32 1,057,734.78 6.2855 6,648,391.96
Other monetary capitals -- -- 16,000,000.00 -- --
RMB -- -- 16,000,000.00 -- --
Total -- -- 565,722,485.68 -- -- 175,181,365.77
Special explanation shall be made for the accounts limited by being mortgaged, pledged or frozen,
deposited overseas or with potential collecting risks:
Monetary capitals at the period-end increased 222.94% comparing to the period-begin, mainly due
to returned money of sales in this period; other monetary capitals at the period-end were security
deposits of account receivable.
2. Trading financial assets
Naught
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
3. Notes receivable
(1) Category of notes receivable
Unit: RMB Yuan
Category Closing balance Opening balance
Bank acceptance bill 30,195,791.15 23,690,345.75
Total 30,195,791.15 23,690,345.75
(2) Notes receivable pledged at period-end
Naught
(3) Notes transferred to accounts receivable because drawer of the notes fails to execute the contract
or agreement, and undue notes endorsed to other parties at the end of the period
Notes transferred to accounts receivable because drawer of the notes fails to execute the contract or
agreement
Unit: RMB Yuan
Issuing equity Date of issuance Expiring day Amount Remark
Notes:
Undue notes endorsed to other parties by the Company
Unit: RMB Yuan
Issuing equity Date of issuance Expiring day Amount Remark
Zhongxing Energy
9 May 2013 8 November 2013 3,835,338.00
(Tianjing) Co., Ltd.
Beijing Jianghe Curtain
20 March 2013 19 September 2013 3,000,000.00
Wall Co., Ltd
Xiamen Airlines
20 March 2013 19 September 2013 3,000,000.00
Development Co., Ltd
Xiamen Airlines
20 March 2013 19 September 2013 3,000,000.00
Development Co., Ltd
Xiamen Airlines
20 March 2013 19 September 2013 3,000,000.00
Development Co., Ltd
Total -- -- 15,835,338.00 --
Notes:
Notes about trade acceptance which is discounted or pledged
4. Dividends receivable
Unit: RMB Yuan
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Whether relating
Increase in this Decrease in this Reason for
Item Opening amount Closing amount accounts occur
period period unrecoverable
impairment
Of which: -- -- -- -- -- --
Of which： -- -- -- -- -- --
Notes
5. Interest receivable
Naught
6. Accounts receivable
(1) Accounts receivable listed by categories
Unit: RMB Yuan
Closing balance Opening balance
Book balance Bad debt provision Book balance Bad debt provision
Category
Proportion Proportion Proportion Proportion
Amount Amount Amount Amount
(%) (%) (%) (%)
Accounts receivable for which bad debt provisions are made on the group basis
297,563,02 38,011,796. 214,802,0 33,837,698.6
Account age groups 99.41% 12.77% 100% 15.75%
9.20 62 76.42 9
297,563,02 38,011,796. 214,802,0 33,837,698.6
Subtotal of the groups 99.41% 12.77% 100% 15.75%
9.20 62 76.42 9
Accounts receivable with
insignificant single 1,763,470.0 1,763,470.0
amount and individually 0.59% 100%
withdrawn bad debt 0 0
provision
299,326,49 39,775,266. 214,802,0 33,837,698.6
Total -- -- -- --
9.20 62 76.42 9
Notes of categories of accounts receivable:
1. The Company defines an account receivable equivalent to or above RMB 5 million as an account
receivable which is individually significant.
2. Accounts receivable are divided into three categories by groups
(1) Related-party groups: Divided according to the related-party relation between the debtor and the
Company (usually the Company’s actual controller and other enterprises controlled by it);
(2) Risk-free groups: Divided according to the debtor’s reputation, the nature of the account,
safeguard measures, etc. (usually amounts due from the government for purchases, reserve funds for
employees, deposits for contracts, accounts receivable arising from guarantee terms, etc.);
(3) Account age groups: Divided according to ages of accounts receivable.
3. The Group carries out an independent impairment test on an account receivable which is
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
individually insignificant but has the following feature. If there is any objective evidence proving
that the asset has been impaired (for instance, receivables over which there exist disputes against the
opposite parties or receivables concerning lawsuits and arbitrations; and receivables of which there
are obvious signs indicating that debtors may not be able to fulfill repayment obligations), the
Group recognizes impairment loss and makes bad-debt provisions according to the difference
between the present value of the asset’s future cash flow and the asset’s book value.
Accounts receivable with significant single amount and individually withdrawn bad debt provision
□Applicable √Inapplicable
In the groups, accounts receivable adopting aging analysis method to withdraw bad debt provision:
√ Applicable □ Inapplicable
Unit: RMB Yuan
Closing balance Opening balance
Book balance Book balance
Aging Provision for bad Provision for bad
Proportion Proportion
Amount debts Amount debts
(%) (%)
Within 1 year
Including: -- -- -- -- -- --
Within 1 year 271,027,030.14 91.08% 13,551,351.51 186,966,192.96 87.04% 9,348,309.64
Subtotal of within
271,027,030.14 91.08% 13,551,351.51 186,966,192.96 87.04% 9,348,309.64
1 year
1-2 years 1,504,073.88 0.51% 150,407.39 3,079,076.37 1.43% 307,907.64
2-3 years 889,898.13 0.3% 266,969.45 601,638.40 0.28% 180,491.52
Over 3 years 24,142,027.05 8.11% 24,043,068.28 24,155,168.69 11.25% 24,000,989.89
3 to 4 years 113,044.44 0.04% 56,522.22 22,515.40 0.01% 11,257.70
4 to 5 years 84,873.10 0.03% 42,436.55 285,842.21 0.13% 142,921.11
Over 5 years 23,944,109.51 8.04% 23,944,109.51 23,846,811.08 11.11% 23,846,811.08
Total 297,563,029.20 -- 38,011,796.62 214,802,076.42 -- 33,837,698.69
In the groups, accounts receivable adopting balance percentage method to withdraw bad debt
provision:
□ Applicable √ Inapplicable
In the groups, accounts receivable adopting other methods to withdraw bad debt provision:
□ Applicable √ Inapplicable
Accounts receivable with insignificant single amount but individually withdrawn bad debt provision
at period-end:
√ Applicable □ Inapplicable
Unit: RMB Yuan
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Withdrawing proportion
Account receivable Balance of book value Provision for bad debt Reason for withdrawal
(%)
Account receivable of
1,763,470.00 1,763,470.00 100%
subsidiary
Total 1,763,470.00 1,763,470.00 -- --
(2) No accounts receivable reversed or recovered in the reporting period
Naught
(3) No accounts receivable that written off in the reporting period
Naught
(4) No shareholders with more than 5% (including 5%) of the voting shares of the Company in
accounts receivable in reporting period
Naught
(5) Accounts receivable due to the top five entities
Unit: RMB Yuan
Name of company Relationship Amount Term Proportion (%)
Foreign customer A Non-related customer 23,205,800.82 Within one year 7.75%
Foreign customer B Non-related customer 13,582,080.12 Within one year 4.54%
Foreign customer C Non-related customer 12,446,233.02 Within one year 4.16%
Foreign customer D Non-related customer 11,279,241.57 Within one year 3.77%
Domestic customer E Non-related customer 9,736,330.14 Within one year 3.25%
Total -- 70,249,685.67 23.47%
(6) Accounts receivable due from related parties
Unit: RMB Yuan
Name of company Relationship Amount Proportion (%)
Under the same control of China
Makhteshim Chemical Works
National Agrochemical 6,450,394.75 2.16%
Ltd.
Corporation
Klamusze Black Dragon Under the same control of China 5,011,500.40 1.67%
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Pesticide Chemical Co., Ltd National Agrochemical
Corporation
Under the same control of China
Shangdong Dacheng
National Agrochemical 42,000.00 0.01%
Agro-chemical Co., Ltd
Corporation
Total -- 11,503,895.15 3.84%
(7) Information of accounts receivable that terminated recognition
Naught
(8) If securitization is carried out on accounts receivable as the underlying assets, please list amount
of assets and liabilities arising from further involvement
Naught
7. Other accounts receivable
(1) Other accounts receivable disclosed by type
Unit: RMB Yuan
Closing balance Opening balance
Provision for doubtful Provision for doubtful
Book balance Book balance
Category debts debts
Proportio Proportio Proportion Proportio
Amount Amount Amount Amount
n (%) n (%) (%) n (%)
Other accounts receivable that provisions for bad debts by group
Account age groups 7,338,743.85 29.57% 5,881,277.64 80.14% 7,135,825.98 28.91% 5,870,435.77 82.27%
17,475,720.8 17,549,975.5
Risk-free groups 70.43% 71.09%
0 8
24,814,464.6 24,685,801.5
Subtotal of group 100% 5,881,277.64 23.7% 100% 5,870,435.77 23.78%
5 6
24,814,464.6 24,685,801.5
Total -- 5,881,277.64 -- -- 5,870,435.77 --
5 6
Notes of categories of other accounts receivable:
1. The Company defines an account receivable equivalent to or above RMB 5 million as an account
receivable which is individually significant.
2. Accounts receivable are divided into three categories by groups
(1) Related-party groups: Divided according to the related-party relation between the debtor and the
Company (usually the Company’s actual controller and other enterprises controlled by it);
(2) Risk-free groups: Divided according to the debtor’s reputation, the nature of the account,
safeguard measures, etc. (usually amounts due from the government for purchases, reserve funds for
employees, deposits for contracts, accounts receivable arising from guarantee terms, etc.);
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
(3) Account age groups: Divided according to ages of accounts receivable.
3. The Group carries out an independent impairment test on an account receivable which is
individually insignificant but has the following feature. If there is any objective evidence proving
that the asset has been impaired (for instance, receivables over which there exist disputes against the
opposite parties or receivables concerning lawsuits and arbitrations; and receivables of which there
are obvious signs indicating that debtors may not be able to fulfill repayment obligations), the
Group recognizes impairment loss and makes bad-debt provisions according to the difference
between the present value of the asset’s future cash flow and the asset’s book value.
Other accounts receivable with significant single amount and individually withdrawn bad debt
provision
□Applicable √Inapplicable
In the groups, other accounts receivable adopting aging analysis method to withdraw bad debt
provision:
√ Applicable □ Inapplicable
Unit: RMB Yuan
Closing balance Opening balance
Book balance Book balance
Aging
Proporti Bad debt provision Proporti Bad debt provision
Amount Amount
on (%) on (%)
Within 1 year
Including:
Within 1 year 1,265,596.30 17.25% 63,279.82 1,047,557.50 14.68% 52,377.87
Subtotal for those aging
1,265,596.30 17.25% 63,279.82 1,047,557.50 14.68% 52,377.87
within 1 year
1-2 years 199,960.65 2.72% 19,996.07 170,000.00 2.38% 17,000.00
2-3 years 89,761.60 1.22% 26,928.48 35,290.65 0.49% 10,587.20
Over 3 years 5,783,425.30 78.81% 5,771,073.28 5,882,977.83 82.45% 5,790,470.70
3-4 years 24,704.05 0.34% 12,352.03
4-5 years 185,014.26 2.59% 92,507.13
Over 5 years 5,758,721.25 78.47% 5,758,721.25 5,697,963.57 79.86% 5,697,963.57
Total 7,338,743.85 -- 5,881,277.64 7,135,825.98 -- 5,870,435.77
In the groups, other accounts receivable adopting balance percentage method to withdraw bad debt
provision:
□ Applicable √ Inapplicable
In the groups, other accounts receivable adopting other methods to withdraw bad debt provision:
√ Applicable □ Inapplicable
Unit: RMB Yuan
Name of group Book balance Provision for bad debts
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Risk-free group（export tax refunds） 17,354,786.34 0.00
Risk-free group (reserve funds) 120,934.46 0.00
Total 17,475,720.80 0.00
Other accounts receivable with insignificant single amount but individually withdrawn bad debt
provision at period-end:
□ Applicable √ Inapplicable
(2) No other accounts receivable reversed or recovered in the reporting period
Naught
(3) Other accounts receivable written off in the reporting period
Unit: RMB Yuan
Nature of other Amount of written Reason for written Whether it is caused by
Name of equity Time of written off
account receivable off off relating trades
Other notes about account receivable written off
(4) No other accounts receivable due from shareholders with more than 5% (including 5%) of the
voting shares of the Company in the reporting period
Unit: RMB Yuan
Closing amount Opening amount
Name of equity Amount of bad debt Amount of bad debt
Book balance Book balance
provision provision
(5) Nature or content of other accounts receivable with significant amount
Unit: RMB Yuan
Nature or details of the
Name of entity Amount Proportion of the total (%)
amount
State export tax rebate
Export tax rebates receivable 17,354,786.34 69.94%
receivable
Total 17,354,786.34 -- 69.94%
Notes:
(6) Information of top five other accounts receivable
Unit: RMB Yuan
Relationship with the Proportion of the total
Name of entity Amount Aging
Company (%)
Grants
receivable—export Non-related party 17,354,786.34 Within 1 year 69.94%
rebates
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Shantou Biyue Plastic
Non-related party 3,125,000.00 Over 5 years 12.59%
Co., Ltd.
Hubei Jingzhou Shashi
Agricultural Production Non-related party 548,500.00 Over 5 years 2.21%
Materials Co., Ltd.
Production Safety
Supervision Bureau of Non-related party 300,000.00 Over 5 years 1.21%
Jingzhou City
Ximen distribution Non-related party 295,307.95 Over 5 years 1.19%
Total -- 21,623,594.29 -- 87.14%
(7) Other account receivable due from related parties
Naught
(8) Information of other accounts receivable that terminated recognition
Naught
(9) If securitization is carried out on the other accounts receivable as the underlying asset, please
brief on the arrangement of relevant transactions.
Naught
8. Prepayment
(1) List by aging analysis
Unit: RMB Yuan
Closing balance Opening balance
Aging Proportion Proportion
Amount Amount
(%) (%)
Within 1 year 60,892,199.50 99.86% 37,503,196.88 99.99%
1-2 years 79,788.00 0.13%
2-3 years 2,600.00 0.01%
Over 3 years 2,600.00 0.01%
Total 60,974,587.50 -- 37,505,796.88 --
Notes of aging of prepayment:
It is mainly prepayment for raw materials, and most of which aged within one year.
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
(2) Information of the top 5 prepayment
Unit: RMB Yuan
Relationship with the
Name of entity Amount Aging Reason for unsettled
Company
Non-related-party Prepayment for raw
Supplier A 22,358,607.21 Within 1 year
supplier materials
Non-related-party Within 1 year Prepayment for raw
Supplier B 7,951,384.12
supplier materials
Non-related-party Within 1 year Prepayment for raw
Supplier C 7,335,000.00
supplier materials
Non-related-party Within 1 year Prepayment for raw
Supplier D 3,144,570.82
supplier materials
Non-related-party Within 1 year Prepayment for raw
Supplier E 2,187,410.82
supplier materials
Total -- 42,976,972.97 --
Notes of important companies of prepayment:
It is mainly bulk raw material suppliers
（(3) Information about amount due from shareholders with more than 5% (including 5%) of the
voting shares of the Company in prepayment
(4) Notes of prepayment
Note: The closing amount of prepayment increased by 62.57% over the opening amount, mainly
because prepayment to suppliers increased
9. Inventory
(1) Category
Unit: RMB Yuan
Closing balance Opening balance
Item Impairment of Impairment of
Book balance Book value Book balance Book value
inventories inventories
Raw materials 75,205,837.03 527,624.25 74,678,212.78 102,562,597.33 572,297.67 101,990,299.66
Goods in process 77,887,858.22 1,913,746.38 75,974,111.84 64,515,528.92 2,345,718.73 62,169,810.19
Inventory goods 200,247,869.83 3,766,837.93 196,481,031.90 205,166,694.12 5,537,576.37 199,629,117.75
Turnover material 5,669,320.35 5,669,320.35 2,970,544.57 2,970,544.57
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Total 359,010,885.43 6,208,208.56 352,802,676.87 375,215,364.94 8,455,592.77 366,759,772.17
(2) Provision for falling price of inventories
Unit: RMB Yuan
Withdrawal in the Decrease in the reporting period
Category Opening book value Closing book balance
reporting period Reversal Written off
Raw materials 572,297.67 58,676.89 103,350.31 527,624.25
Goods in process 2,345,718.73 -431,972.35 1,913,746.38
Inventory goods 5,537,576.37 -287,550.70 1,483,187.74 3,766,837.93
Total 8,455,592.77 -660,846.16 1,586,538.05 6,208,208.56
(3) Details of provision for falling price of inventories
Proportion of reversal of
Basis on provision for falling Reasons for reversal in provision for impairment of
Item
price of inventories reporting period inventories to closing balance
(%)
Book cost is higher than
Raw materials
realizable net value
Book cost is higher than
Inventory goods
realizable net value
Book cost is higher than
Goods in process
realizable net value
Book cost is higher than
Turnover material
realizable net value
Book cost is higher than
Consumable biological assets
realizable net value
Notes of inventory:
Inventories were all in normal condition and the falling price of inventory was due to the market
factor
10. Other current assets
Naught
11. Available-for-sale financial assets
Naught
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
12. Held-to-maturity investment
Naught
13. Long-term accounts receivable
Naught
14. Investment to joint ventures and associated enterprises
Naught
15. Long-term equity investment
(1) List of long-term equity investment
Unit: RMB Yuan
Explanati
on for
indifferen
ces Withdraw
between n
Sharehold Cash
Voting the impairme
Accounti Initial ing Impairme bonus in
Opening Increase/d Closing percentag sharehold nt
Investee ng investmen percentag nt the
balance ecrease balance e in ing provision
method t cost e in provision reporting
investee percentag in the
investee period
e and reporting
voting period
percentag
e in
investee
Hubei Cost 20,000,00 20,000,00 20,000,00 11,991,01 2,254,182
1.18% 1.18%
Bank method 0.00 0.00 0.00 7.37 .43
Hubei
Shendian
Mobile
Cost 564,000.0 564,000.0 564,000.0
and 0.6% 0.6%
method 0 0 0
Electric
Motor
Co., Ltd.
Guangxi
Cost 580,800.0 580,800.0 580,800.0
Zhongdin 1.41% 1.41%
method 0 0 0
g Holding
93
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Co., Ltd
21,144,80 21,144,80 21,144,80 11,991,01 2,254,182
Total -- -- -- --
0.00 0.00 0.00 7.37 .43
(2) Information of the limitation on the capability to transfer capital to investee
Naught
16. Investment property
(1) Investment property calculated by cost
Unit: RMB Yuan
Increase in the reporting Decrease in the
Item Opening book balance Closing book balance
period reporting period
I. Total original book
6,010,000.00 6,010,000.00
value
1. Houses & buildings 6,010,000.00 6,010,000.00
II. Accumulated
depreciation and
1,615,187.50 120,200.00 1,735,387.50
accumulated
amortization
1. Houses & buildings 1,615,187.50 120,200.00 1,735,387.50
III. Total net book
value of investment 4,394,812.50 -120,200.00 4,274,612.50
property
1. Houses & buildings 4,394,812.50 -120,200.00 4,274,612.50
V. Total book value of
4,394,812.50 -120,200.00 4,274,612.50
investment property
1. Houses & buildings 4,394,812.50 -120,200.00 4,274,612.50
Unit: RMB Yuan
The reporting period
Depreciation and amortization of the reporting period 120,200.00
(2) Investment property calculated by fair value
Unit: RMB Yuan
Fair value at Increase in this period Decrease in this period Fair value
Item the Self-own Loss and Transfer to at the
Purchase Disposition
period-begin real estate or gain for the be self-own period-end
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
inventory change of real estate
transfer fair value
Illustrate situations of investment real estate with changing measurement model and investment real
estate without certificate of title in the reporting period, and demonstrate the reason and expected
time of completion of investment real estate without certificate of title.
Notes: Depreciation amount totaled RMB 120,200.00 in the reporting period. The said asset is
Hubei Building in Shenzhen with an area of 780 square meters. The relevant property certificate is a
collective warrant, part of which belongs to the Company. Currently, the Company is unable to go
through formalities for changes of the collective warrant.。
17. Fixed assets
(1) Information
Unit: RMB Yuan
Opening book Decrease in the Closing book
Item Increase in the reporting period
balance reporting period balance
I. Total original book value 2,021,278,707.50 42,275,709.59 10,512,207.61 2,053,042,209.48
Including: Property and
681,767,539.15 4,787,866.43 783,238.20 685,772,167.38
buildings
Machineries 1,326,711,390.84 37,487,843.16 9,316,769.41 1,354,882,464.59
Vehicles 12,799,777.51 412,200.00 12,387,577.51
Opening book Increase in Withdrawal in Decrease in current Closing book
--
balance current period current period period balance
II. Accumulated
692,788,475.40 79,075,718.91 9,699,690.59 762,164,503.72
depreciation
Including: Property and
148,294,758.24 14,353,354.87 263,889.99 162,384,223.12
buildings
Machineries 536,142,857.00 64,022,768.05 9,023,600.60 591,142,024.45
Vehicles 8,350,860.16 699,595.99 412,200.00 8,638,256.15
Opening book Closing book
-- --
balance balance
III. The net book value of
1,328,490,232.10 -- 1,290,877,705.76
fixed assets
Including: Property and
533,472,780.91 -- 523,387,944.26
buildings
Machineries 790,568,533.84 -- 763,740,440.14
Vehicles 4,448,917.35 -- 3,749,321.36
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
IV. Total impairment
19,860,879.50 -- 19,860,879.50
provision
Including: Property and
7,898,332.18 -- 7,898,332.18
buildings
Machineries 11,962,547.32 -- 11,962,547.32
V. Total book value of fixed
1,308,629,352.60 -- 1,271,016,826.26
assets
Including: Property and
525,574,448.73 -- 515,489,612.08
buildings
Machineries 778,605,986.52 -- 751,777,892.82
Vehicles 4,448,917.35 -- 3,749,321.36
Depreciation amount of this reporting period was of RMB 79,075,718.91; RMB 32,215,001.56 was
transferred into fixed assets from construction project in the reporting period.
（(2) Temporary idle fixed assets
Naught
(3) Fixed assets leased in from financing lease
Naught
(4) Fixed assets leased out from operation lease
Naught
(5) Information of hold-for-sale fixed assets at period-end
Naught
(6) Information of fixed assets failed to accomplish certification of property
Naught
18. Construction in progress
(1)
Unit: yuan
Closing balance Opening balance
Item Impairment Impairment
Book balance Book value Book balance Book value
provision provision
10,000t /a pyridine and its
88,301,015.37 88,301,015.37 82,182,269.21 82,182,269.21
derivatives
Salt mine Shayan 13,604,728.89 13,604,728.89
96
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
No.9-Ping10 well project
4,000t/a methomy l and gas
2,009,361.65 2,009,361.65
expansion project
Remould the methanol
2,145,994.24 2,145,994.24
recovery tower No.1
Advance payment for the
20,283,536.40 20,283,536.40 21,321,291.50 21,321,291.50
project
The production and packing
2,496,174.75 2,496,174.75
plant of Acetyl powder
1,000 ton yellow phosphorus
322,387.70 322,387.70
storage tank project
20000t\a,4-D acid project
(condensation, acidification 1,107,456.21 1,107,456.21
and rectification)
The expansion and
reconstruction of the active
1,879,569.76 1,879,569.76
compound of 4,000 t/a
triazophos
The expansion and
reconstruction project of 809,884.33 809,884.33
2,000 t/a Isobutyl ester
The relocation of the system
of the extraction, desolation,
800,178.38 800,178.38
technically improvement and
amination
The preparation project of
2,053,569.44 2,053,569.44
4,000 glyphosate
The new construction project
of clean-water reservoirs in 176,975.81 176,975.81
the sewage disposal plant
The buried rebuilding of
110KV wires of the thermal 235,849.06 235,849.06
power plant
200,000 ton ionic membrane
8,119,732.30 8,119,732.30
caustic soda in stage I
Total 126,586,329.51 126,586,329.51 121,263,645.49 121,263,645.49
(2) Significant changes in construction in progress
Unit: yuan
Includin
Project
Increase Transferr g: Capitaliz
input Capitaliz Source
Name of Opening in ed to Other Project capitaliz ation of Closing
Budget percenta ation of of
project balance current fixed decrease process ation of interest balance
ge of interest funding
period assets interest rate (%)
budget
this
97
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
period
Salt
mine Borrowi
Shayan 23,000,0 13,604,7 9,715,59 23,320,3 640,014. 463,196. ngs and
101.39% 100 6.01%
No.9-Pin 00.00 28.89 5.35 24.24 46 55 self
g10 well finance
project
Remould
the Borrowi
methanol 3,400,00 2,145,99 1,403,61 3,549,61 111,284. 96,277.7 ngs and
104.4% 100 6.01%
recovery 0.00 4.24 6.70 0.94 13 7 self
tower finance
No.1
4,000t/a
methom Borrowi
yl and 5,200,00 2,009,36 3,335,70 5,345,06 146,849. 133,213. ngs and
102.79% 100 6.01%
gas 0.00 1.65 4.73 6.38 46 54 self
expansio finance
n project
Diacetyl
agricultu
ral
producti Borrowi
on and 2,800,00 2,496,17 35,704.6 35,704.6 ngs and 2,496,17
89.15% 89.15 6.01%
packagin 0.00 4.75 9 9 self 4.75
g finance
equipme
nt
powder
1,000
ton
yellow Borrowi
phosphor 4,250,00 322,387. ngs and 322,387.
7.59% 7.59 2,069.38 2,069.38 6.01%
us 0.00 70 self 70
storage finance
tank
project
The
preparati
Borrowi
on
4,670,00 2,053,56 15,945.7 15,945.7 ngs and 2,053,56
project 43.97% 43.97 6.01%
0.00 9.44 1 1 self 9.44
of 4,000
finance
glyphosa
te
98
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
The
relocatio
n of the
system
of the
extractio
Borrowi
n,
2,510,00 800,178. ngs and 800,178.
desolvati 31.88% 31.88 6,704.17 6,704.17 6.01%
0.00 38 self 38
on,
finance
technical
ly
improve
ment and
aminatio
n
200,000
ton ionic
Borrowi
membra
710,985, 8,119,73 ngs and 8,119,73
ne 1.14% 1.14
900.00 2.30 self 2.30
caustic
finance
soda in
stage I
10,000t
/a Borrowi
pyridine 161,300, 82,182,2 6,118,74 18,899,8 1,520,62 ngs and 88,301,0
72.64% 72.64 6.37%
and its 000.00 69.21 6.16 40.90 4.44 self 15.37
derivativ finance
es
918,115, 99,942,3 34,365,7 32,215,0 19,858,4 2,273,73 102,093,
Total -- -- -- --
900.00 53.99 05.51 01.56 12.90 6.25 057.94
Notes of changes in construction in progress:
(3) Impairment provision of construction in progress
Naught
(4) Information of procedures of significant construction in progress
Item Process Remark
The project has transferred into fixed
Salt mine Shayan No.9-Ping10 well project 100
assets
Remould the methanol recovery tower The project has transferred into fixed
100
No.1 assets
4,000t/a methomyl and gas expansion The project has transferred into fixed
100
project assets
The production and packing plant of
89.15 In progress
Acetyl powder
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
1,000 ton yellow phosphorus storage tank
7.59 In progress
project
The preparation project of 4,000
43.97 In progress
glyphosate
The relocation of the system of the
extraction, desolvation, technically 31.88 In progress
improvement and amination
200,000 ton ionic membrane caustic soda
1.14 In progress
in stage I
10,000t /a pyridine and its derivatives 72.64 In progress
(5) Notes of construction in progress:
19. Engineering materials
Naught
20. Clearance of fixed assets
Naught
21. Productive biological assets
Naught
22. Oil and gas assets
Naught
23. Intangible assets
(1) Information
Unit: yuan
Increase in the reporting Decrease in the
Item Opening balance Closing balance
period reporting period
I. Total original book value 215,899,507.03 215,899,507.03
Land use right 201,673,307.07 201,673,307.07
Non-patents 14,223,699.96 14,223,699.96
Patent 2,500.00 2,500.00
II. Total accrued
39,923,402.82 2,016,029.78 41,939,432.60
amortization
Land use right 34,365,369.61 1,689,529.76 36,054,899.37
Non-patents 5,555,533.21 326,500.02 5,882,033.23
Patent 2,500.00 2,500.00
III. Total net book value of
175,976,104.21 -2,016,029.78 173,960,074.43
intangible assets
Land use right 167,307,937.46 -1,689,529.76 165,618,407.70
Non-patents 8,668,166.75 -326,500.02 8,341,666.73
Patent
IV. Total impairment
32,072,093.53 32,072,093.53
provision
Land use right 32,072,093.53 32,072,093.53
Non-patents
Patent
100
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Total book value of
143,904,010.68 -2,016,029.78 141,887,980.90
intangible assets
Land use right 135,235,843.93 -1,689,529.76 133,546,314.17
Non-patents 8,668,166.75 -326,500.02 8,341,666.73
Patent
Amortization was of RMB 2,016,029.78 in the reporting period.
(2) Company development expense
Unit: yuan
Decrease
Item Opening balance Increase Recognized into Recognized as Closing balance
current gains/losses intangible assets
Development expense percentage of total expenditure of R&D projects in the reporting period.
Percentage intangible assets arising from inner R&D of the Company of closing book value of intangible assets.
Notes of R&D projects of the Company, those that include individual value of more than RMB 1 million and
recognized with a basis of assessed value, please disclose name of evaluation authority and method of evaluation:
Naught
24. Goodwill
Naught
25. Long-term amortization expense
Naught
26. Deferred tax assets and liabilities
(1) Deferred tax assets and liabilities are not listed as the net value after offset
Deferred tax assets and liabilities that already recognized
Unit: yuan
Item Closing balance Opening balance
Deferred income tax assets:
Provision for assets impairment 14,245,757.52 12,922,010.54
Special reserves 2,221,675.14 2,309,746.56
Subtotal 16,467,432.66 15,231,757.10
Deferred income tax liabilities:
List of unrecognized deferred income tax assets
Unit: yuan
Item Closing balance Opening balance
Deductible temporary differences 25,642,901.00 27,236,863.35
Total 25,642,901.00 27,236,863.35
Deductible losses of unrecognized deferred income tax assets will due in the following years
Unit: yuan
Year Closing balance Opening balance Remark
List of taxable differences and deductible differences items
101
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Unit: yuan
Temporary differences amount
Item
As at period-end As at period-begin
Taxable differences items
Deductible differences item
Property depreciation preparation 56,983,030.07 51,688,042.12
Special reserves 8,886,700.55 9,238,986.24
Subtotal 65,869,730.62 60,927,028.36
(2) Deferred income tax assets and liabilities are listed as the net value after offset
Components items of deferred income tax assets and liabilities after mutual set-off
Unit: yuan
Deductible or taxabl Deferred income tax Deductible or taxable
Deferred income tax
e temporary differen assets or liabilities temporary
assets or liabilities
Item ces after mutual set after mutual set-off at differences after
after mutual set-off at
-off at the end of t the opening of the mutual set-off at the
the end of the period
he period period opening of the period
Deferred income tax assets 16,467,432.66 65,869,730.62 15,231,757.10 60,927,028.36
Notes of deferred income tax assets and the deferred income tax liabilities
Unit: yuan
Item Amounts of the mutual set-off in the period
Notes of deferred income tax assets and the deferred income tax liabilities
27. List of provision for assets impairment
Unit: yuan
Opening book Decrease Closing book
Item Increase
balance Reversal Written off balance
I. Provision for bad debt 39,708,134.46 5,948,409.80 45,656,544.26
II. Provision for inventory
8,455,592.77 -660,846.16 1,586,538.05 6,208,208.56
falling price
III. Impairment provision of
11,991,017.37 11,991,017.37
long-term equity investment
IV. Impairment provision of
19,860,879.50 19,860,879.50
fixed assets
V. Impairment provision of
32,072,093.53 32,072,093.53
intangible assets
Total 112,087,717.63 5,287,563.64 1,586,538.05 115,788,743.22
Notes of the list of assets impairment:
The land of provision for impairment located at Jingzhou Xuetangzhou, with an area of 400, 000 m2. It was
provided by Jingzhou municipal government to offset discount amount in 2001 with an origin value of RMB
86,672,093.53. As an industrial land of fourth grade with a term of 50 years, the land has been idle since acquired.
In 2007, the Company made provision for impairment totaled RMB 32,072,093.53 by taking measure and
calculation of it. There were no sign of forward impairment in the reporting period.
28. Other non-current assets
Naught
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
29. Short-term loan
(1) Category
Unit: yuan
Category Closing balance Opening balance
Pledge loan 213,038,937.68 60,708,601.70
Mortgage loan 85,000,000.00 25,000,000.00
Guarantee loan 348,000,000.00 270,000,000.00
Credit loan 20,000,000.00
Total 666,038,937.68 355,708,601.70
Notes:
Pledge loan of the Company mainly was loan receiving from the pledge of accounts receivable.
Mortgage loan of the Company mainly was loan receiving from mortgage of house and buildings as well as land.
Guarantee loan of the Company mainly was loan receiving from guarantees provided by Sanonda Group
Corporation, China National Agrochemical Corporation and China National Chemical Corporation.
Credit loan of the Company mainly was loan receiving from the SG.
(2) List of unsettled mature short-term loan
Naught
30. Trading financial liabilities
Naught
31. Notes payable
Unit: yuan
Category Closing balance Opening balance
Bank acceptance 100,000,000.00
Total 100,000,000.00
RMB 100,000,000.00 will be due in next accounting period.
Notes of notes payable:
Newly increase of bank acceptance bill of the Group was mainly used for payment of raw materials, with a term
of 6 months.
32. Accounts payable
(1)
Unit: yuan
Item Closing balance Opening balance
Within 1 year 231,367,101.51 190,845,593.34
1 to 2 years 3,380,873.35 4,284,922.72
2 to 3 years 1,560,780.41 239,080.85
Over 3 years 3,853,346.67 3,624,730.35
Total 240,162,101.94 198,994,327.26
(2) The accounts payable to shareholders with more than 5% (including 5%) of the voting shares of the
Company
Naught
(3) Notes of the accounts payable aging over one year:
103
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Name of creditor Amount Reason Whether pay
back after
Balance Sheet
Date?
Tianjin Heqing Chemical Industry Co., Ltd. 900,000.00 Project No
uncompleted
Hubei Industrial Construction Group Co., Ltd. 835,937,69 Project No
uncompleted
Wuhan Changjiang Sand shipyard steamship company 750,000.00 Project No
uncompleted
Yuyang Lianhua Tongda Construction Engineering 365,871.65 Project No
Co., Ltd. uncompleted
Yichang Junma Electronic Equipment Engineering 246,295.85 Project No
Company uncompleted
Total 3,098,105.19
33. Advance from customers
(1)
Unit: yuan
Item Closing balance Opening balance
Within 1 year 94,849,592.66 57,748,349.15
1 to 2 years 466,664.08 234,053.64
2 to 3 years 161,954.29 127,728.32
Over 3 years 1,418,202.65 1,337,899.19
Total 96,896,413.68 59,448,030.30
(2) Advanced from customers from shareholders with more than 5% (including 5%) of the voting shares of
the Company
Unit: yuan
Name of entity Closing balance Opening balance
China National Agrochemical Corporation 0.00 35,183.75
Total 0.00 35,183.75
(3) Notes of significant advance from customers aging over one year:
Naught
34. Payroll payable
Unit: yuan
Item Opening book balance Increase Decrease Closing book balance
I. Salary, bonus,
6,510,205.00 48,254,178.12 47,650,604.62 7,113,778.50
allowance, subsidy
II. Employee welfare 1,953,190.69 1,953,190.69
III. Social insurance 560,000.00 18,019,427.76 13,930,791.66 4,648,636.10
Including: Medical 3,800,542.98 3,359,350.17 441,192.81
104
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
insurance premiums
Basic pension
9,592,079.25 8,341,994.11 1,250,085.14
benefits
Pension payments 2,820,917.64 198,933.13 2,621,984.51
Unemployment
560,000.00 978,455.06 1,322,420.92 216,034.14
insurance
Work-related injury
671,527.17 576,115.69 95,411.48
insurance
Maternity insurance 155,905.66 131,977.64 23,928.02
IV. Housing fund 31,791.62 6,472,300.00 6,482,660.00 21,431.62
V. Redemption for
terminations of labor 731,953.24 731,953.24
contract
VI. Others 262,905.27 324,430.68 244,256.00 343,079.95
Labour union budget
and employee 262,905.27 324,430.68 244,256.00 343,079.95
education budget
Other 7,364,901.89 75,755,480.49 70,993,456.21 12,126,926.17
RMB 0.00 is the amounts in arrears in the payroll payable.
The labor union budget and employee education budget is RMB 343,079.95, and the non-monetary benefits are
RMB 0.00, the compensation for terminating the labor contract is RMB 0.00.
The estimated distribution date and amount as well as other arrangements for payroll payable:
The balances of “Wages, bonuses, allowances and subsidies” among the payroll payable mainly are senior and
middle management staff bonuses, which would be issued after Aug, 2013.
35. Taxes payable
Unit: yuan
Item Closing balance Opening balance
VAT -10,278,424.90 -42,655,212.04
Consumption tax 91,401.66 59,199.71
Business tax 34,007,989.96 21,307,480.29
Corporate income tax 1,163,773.70 337,953.65
Personal income tax 201,051.45 12,579.10
Urban maintenance and construction tax 51,637.18 54,231.71
Resource tax 358,678.17 1,335,124.88
Property tax 486,578.43 164,233.63
Land use tax -101,745.56 278,982.09
Education surtax 25,980,940.09 -19,105,426.98
Notes of taxes payable: for the taxable income of branch companies and factories approved to be inter-adjusted by
their local tax authorities, the Company shall specified their calculation procedure.
36. Interest payable
Naught
37. Dividends payable
Unit: yuan
105
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Reason for unsettlement over 1
Name of company Closing balance Opening balance
year
State-owned Assets Supervision Individual shareholders didn’t
and Administration Commission of 432,926.62 224,463.30 withdraw cash dividends on
Qichun previous years
Individual shareholders didn’t
Jingzhou Shashi Rural Credit Union 250,000.00 125,000.00 withdraw cash dividends on
previous years
Total 682,926.62 349,463.30 --
Notes:
38. Other accounts payable
(1)
Unit: yuan
Item Closing balance Opening balance
Within 1 year 52,880,289.57 27,041,006.55
1 to 2 years 1,407,467.57 2,302,971.21
2 to 3 years 1,437,817.00 322,457.30
Over 3 years 1,716,554.40 1,703,242.71
Total 57,442,128.54 31,369,677.77
(2) Other accounts payable from shareholders with more than 5% (including 5%) of the voting shares of
the Company
Naught
(3) Notes of the other large amount accounts payable aging over 1 year
There were no other large accounts payables aging over 1 year at period-end of the Group.
(4) Notes of other accounts payable with significant amount
Other accounts payable as at period-end increased 83.11% than period-begin, mainly because the loan received
from the Huaxiang Company increased and the unpaid sales expenses increased in the reporting period.
39. Estimated liabilities
Naught
40. Non-current liabilities due within 1 year
(1)
Unit: yuan
Item Closing balance Opening balance
Long-term loan due within 1 year 230,000,000.00 402,560,000.00
Long-term accounts payable due within 1 year 6,990,000.00 6,990,000.00
Total 236,990,000.00 409,550,000.00
(2) Long-term loan due within 1 year
Long-term loan due within 1 year
Unit: yuan
Item Closing balance Opening balance
Guarantee loan 230,000,000.00 402,560,000.00
Total 230,000,000.00 402,560,000.00
106
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
RMB 000 of long-term loan due within 1 year was of mature loan with extended term.
Top five long-term loans due within 1 year
Unit: yuan
Closing balance Opening balance
Foreign Foreign
Creditor Starting date Ending date Currency Rate (%)
currency RMB balance currency RMB balance
balance balance
The
Export-impor 65,000,000.0 65,000,000.0
6, May, 2011 6, July, 2013 RMB 5.35%
t Bank of 0 0
China
The
Export-impor 85,000,000.0 85,000,000.0
3, Jun, 2011 6, July, 2013 RMB 5.35%
t Bank of 0 0
China
China
40,000,000.0 40,000,000.0
Construction 29, Aug,2008 28, Aug,2013 RMB 6.4%
0 0
Bank
China
40,000,000.0
Construction 10, Feb, 2009 9, Feb, 2014 RMB 6.4%
0
Bank
230,000,000. 190,000,000.
Total -- -- -- -- -- --
00 00
Mature loan of long-term loan due within 1 year:
Unit: yuan
Reason for Estimated settle
Creditor Amount of loan Overdue date Annual rate (%) Usage
unsettlement date
RMB** was paid back after Balance Sheet Date:
Notes of long-term borrowings due within 1 year:
(3) Bonds payable due within 1 year
Naught
(4) Long-term accounts payable due within 1 year
Unit: yuan
Creditor Term Initial amount Rate (%) Accrued interest Closing balance Conditions
Hubei Sanonda Acute toxic
5 years 6,990,000.00 6,990,000.00
Co., Ltd. pesticide project
Notes of long-term accounts payable due within 1 year:
The long-term payable due within 1 year in this year had already expired in 2012, which belongs to the unpaid
overdue payables.
41. Other current liabilities
Naught
42. Long-term loan
(1) Category of long-term loan
Unit: yuan
107
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Item Closing balance Opening balance
Guarantee loan 280,000,000.00 482,560,000.00
Less: long-term loan due within 1 year -230,000,000.00 -402,560,000.00
Total 50,000,000.00 80,000,000.00
Notes: Long-term loan were all guarantee loan received from guarantee provided by Sanonda Group Corporation,
China National Agrochemical Corporation and China National Chemical Corporation.
(2) The top five long-term loans
Unit: yuan
Closing balance Opening balance
Foreign Foreign
Creditor Starting date Ending date Currency Rate (%)
currency RMB amount currency RMB amount
amount amount
The
Export-impor 50,000,000.0
30, Jan, 2013 30, July,2014 RMB 5.84%
t Bank of 0
China
Industrial 31, May, 40,000,000.0
31, May,2015 RMB 6.9%
Bank 2010 0
China
20,000,000.0
Construction 10, Feb, 2009 9, Feb, 2014 RMB 6.9%
0
Bank
China Citic 11, July, 20,000,000.0
27, Jan, 2014 RMB 6.15%
Bank 2013 0
50,000,000.0 80,000,000.0
Total -- -- -- -- -- --
0 0
Notes of long-term loan: for the long-term loans arising from mature loans with extended term, the Company shall
explain the conditions of extension, principal, interest, expected repayment arrangement:
43. Bonds payable
Naught
44. Long-term payable
(1) The top five long-term payable
Unit: yuan
Conditions of
Unit Term Initial amount Rate (%) Accrued interest Closing balance
loan
Loan for
glyphosate 490,000.00 490,000.00
project
Borrowing for the
cooperation
project with 160,000.00 160,000.00
Guangzhou
Chemical
108
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Industry Research
Institute
(2) List of the financing lease payable under the long-term loan
Naught
45. Specific payable
Naught
46. Other non-current liabilities
Unit: yuan
Item Closing book balance Opening book balance
Pyridine project 8,850,000.00 8,850,000.00
Highly toxic pesticide production Line change and
4,271,666.67 4,660,000.00
replacement project
Special subsidies of sewage source processing 1,344,444.43 1,466,666.66
Special fund deferred of turn environmental
700,000.01 733,333.34
protection
Appropriation for CTC consuming and
599,089.24
eliminating project
Total 15,166,111.11 16,309,089.24
Notes of other non-current liabilities, including each government grants relevant to assets and income received in
the reporting period and their closing amounts:
47. Share capital
Unit: yuan
Increase/Decrease (+/-)
Opening Capitalization Closing
Issuing new
balance Bonus shares of public Other Subtotal balance
shares
reserves
Total shares 593,923,220.00 593,923,220.00
Notes of changes in share capital, for those action of increasing capital or decreasing capital in the reporting
period, the Company shall disclose the name of the accounting firm executing the capital verification and
document number of the capital verification report; for joint-stock companies running for less than three years,
only the net assets shall be specified for particulars before establishment; while for case of totally changing the
limited liability companies into joint-stock companies, capital verification on the establishment shall be specified:
48. Treasury stock
Notes of treasury stock:
49. Special reserves
Notes of treasury stock:
Item Opening Increase in Decrease in Closing
balance current period current period balance
Safty in production expense 13,825,364.46 5,317,745.19 5,287,296.80 13,855,812.85
Total 13,825,364.46 5,317,745.19 5,287,296.80 13,855,812.85
50. Capital reserves
109
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Unit: yuan
Item Opening balance Increase Decrease Closing balance
Capital premium (share
257,595,681.30 2,924,567.83 254,671,113.47
capital premium)
Other capital reserves 8,495,091.72 8,495,091.72
Total 266,090,773.02 2,924,567.83 263,166,205.19
Notes:
When the Company purchased minority shareholders’ equities of the subsidy—Sanonda (Jingzhou) Agr
ochemical Co., Ltd. and Hubei Sanonda Foreign Trade Co., Ltd. in this year, the newly gained long-ter
m equity investment and the identifiable net assets shares which according to calculation method of the
new shareholding percentage, should enjoy the differences between the identifiable net assets shares holdi
ng by the subsidies that constantly calculates from the purchasing date. Capital premium (share capital pr
emium) in the combined financial statement decreased by the amount of RMB 2,924,567.83.
51. Surplus reserves
Unit: yuan
Item Opening balance Increase Decrease Closing balance
Statutory surplus reserves 88,864,953.49 88,864,953.49
Discretional surplus reserves 3,815,085.65 3,815,085.65
Total 92,680,039.14 92,680,039.14
Notes of surplus reserves: for surplus reserves transferred to share capital, compensating losses and distributed as
dividends, relevant resolutions shall be explained:
52. Provision for general risk
Notes of provision for general risk:
53. Retained profits
Unit: yuan
Withdrawal or distributed
Item Amount
proportion
Opening balance of retained profits before
289,017,364.90 --
adjustments
Opening balance of retained profits after
289,017,364.90 --
adjustments
Add: Net profit attributable to owners of the
127,470,524.25 --
Company
Dividend of common stock payable 29,486,343.44
Closing retained profits 387,001,545.71 --
List of adjustment of opening retained profits:
1) RMB* opening retained profits was affected by retrospective adjustment conducted according to the
Accounting Standards for Business Enterprises and relevant new regulations.
2) RMB* opening retained profits was affected by changes on accounting policies.
3) RMB* opening retained profits was affected by correction of significant accounting errors.
4) RMB* opening retained profits was affected by changes in combination scope arising from same control.
5) RMB* opening retained profits was affected totally by other adjustments.
110
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Notes: as for IPO companies, if the accumulated profits were enjoyed by new and original shareholders according
to the resolutions made at the shareholders’ general meeting before public offering, the Company shall explain
clearly; if the accumulated profits were distributed before public offering and enjoyed by the original shareholders
according to the resolutions made at the shareholders’ general meeting, the Company shall clearly disclose the
audited profits of dividends payable enjoyed by the original shareholders.
54. Revenue and Cost of Sales
(1) Revenue, Cost of Sales
Unit: yuan
Item Reporting period Same period of last year
Sales of main business 1,506,296,510.91 1,083,164,933.46
Other operating income 13,391,806.31 33,590,343.61
Cost of sales 1,210,871,838.98 956,561,172.05
(2) Main business (Classified by industry)
Unit: yuan
Reporting period Same period of last year
Industry
Revenue of sales Costs of sales Revenue of sales Costs of sales
Manufacturing of chemical raw
material 1,506,296,510.91 1,204,175,172.89 1,083,164,933.46 928,161,925.69
and chemicals
Total 1,506,296,510.91 1,204,175,172.89 1,083,164,933.46 928,161,925.69
(3) Main business (Classified by product)
Unit: yuan
Reporting period Same period of last year
Product
Revenue of sales Costs of sales Revenue of sales Costs of sales
Agrochemicals such as
1,557,457,099.01 1,267,811,661.55 1,136,141,562.19 995,051,466.51
chemical fertilizer and pesticide
New chemical materials
8,363,760.70 4,721,396.56 8,290,427.16 4,256,668.64
and special chemicals
Petrochemicals and refining
60,572,466.92 52,578,482.51 57,932,775.77 48,252,498.08
and chemical products
Basic (chlor-alkali) chemicals 8,067,409.36 7,227,857.35 3,381,404.09 3,182,528.21
Internal offset amount -128,164,225.08 -128,164,225.08 -122,581,235.75 -122,581,235.75
Total 1,506,296,510.91 1,204,175,172.89 1,083,164,933.46 928,161,925.69
(4) Main business (Classified by area)
Unit: yuan
Reporting period Same period of last year
Area
Revenue of sales Costs of sales Revenue of sales Costs of sales
Home 851,193,234.06 677,842,526.40 634,193,164.65 535,297,331.31
Abroad 783,267,501.93 654,496,871.57 571,553,004.56 515,445,830.13
Internal offset amount -128,164,225.08 -128,164,225.08 -122,581,235.75 -122,581,235.75
Total 1,506,296,510.91 1,204,175,172.89 1,083,164,933.46 928,161,925.69
(5) The revenue of sales from the top five customers
Unit: yuan
111
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Customer Main business revenue Proportion of total business revenue (%)
Customer A of foreign accounts 112,253,102.94 7.39%
Customer B of foreign accounts 106,360,893.33 7%
Customer C of domestic accounts 68,362,599.73 4.5%
Customer D of domestic accounts 64,331,022.91 4.23%
Customer E of foreign accounts 47,513,952.00 3.12%
Total 398,821,570.91 26.24%
Notes:
55. Revenue from the construction contracts
Unit: yuan
Recognized
Incurred cumulative cumulative gross
Fixed price contract Contract item Amount Settled amount
costs profit (Losses
presented by “-”)
Recognized
Incurred cumulative cumulative gross
Cost plus contract Contract item Amount Settled amount
costs profit (Losses
presented by “-”)
Notes on construction contracts
56. Business tax and surcharges
Unit: yuan
Item Reporting period Same period of last year Calculation and payment standard
Business tax shall be paid at 5% of
Business tax 385,499.31 150,107.51
turnover
Urban maintenance and construction City maintenance construction tax shall
tax 357,626.09 196,195.08 be paid at 7% or 5% of circulating tax
payable of the current period.
Education surtax Extra charges for education shall be
153,268.32 106,928.11 paid at 3% of circulating tax payable of
the current period
Extra charges for local education shall
Local education surtax 98,861.49 33,095.60 be paid at 2% of circulating tax payable
of the current period
Other 60,727.48
Total 1,055,982.69 486,326.30 --
Notes:
57. Selling expenses
Unit: yuan
Item Reporting period Same period of last year
Traffic expenses 18,060,547.63 13,128,510.26
Export costs 15,507,210.21 10,816,947.14
Employee compensations 2,808,744.28 1,587,190.20
Packing expenses 1,464,854.07 1,338,666.46
112
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Terminal charges 1,990,585.40 1,055,040.22
Advertising and promotion expenses 484,265.77 683,839.20
Operating funds 652,245.52 1,187,209.41
Other 4,606,959.15 5,880,805.36
Total 45,575,412.03 35,678,208.25
58. Administration expenses
Unit: yuan
Item Reporting period Same period of last year
Employee compensations 18,993,196.34 17,408,802.30
Taxes 3,040,806.87 2,574,892.08
Depreciation expenses 2,966,158.50 2,474,937.36
Amortization of intangible assets 2,016,029.78 2,040,404.10
Entertainment expenses 1,467,162.48 1,572,292.00
Assets insurance fees 1,706,555.41 1,562,998.56
Utilities 1,698,913.58 1,403,920.15
Administrative expenses 963,403.31 1,146,339.27
Expenses on environmental protection 879,271.00 1,070,750.00
Other 12,995,206.09 11,928,033.49
Total 46,726,703.36 43,183,369.31
59. Financial expenses
Unit: yuan
Item Reporting period Same period of last year
Interest expenses 30,364,498.82 36,474,366.87
Interest incomes -1,985,918.11 -2,039,871.63
Amounts of interest capitalized -2,319,111.21 -8,621,877.34
Gains or losses on exchange 5,590,598.37 -370,901.34
Other 8,561,487.11 6,554,677.41
Total 40,211,554.98 31,996,393.97
60. Gains and losses from changes in fair value
Unit: yuan
Source Reporting period Same period of last year
Notes:
61. Investment income
(1) List of investment income
Unit: yuan
Item Reporting period Same period of last year
Long-term equity investment income accounted by
2,254,182.43
cost method
Total 2,254,182.43
(2) Long-term equity investment income accounted by cost method
Unit: yuan
Name of investee Reporting period Same period of last Reason for increase/decrease
113
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
year
Bank of Hubei 2,254,182.43
Total 2,254,182.43 --
(3) Long-term equity investment income accounted by equity method
Unit: yuan
Same period of last
Name of investee Reporting period Reason for increase/decrease
year
Notes of investment income: make notes if there is significant limitation for recovery of investment income. If
there isn’t the said limitation, notes too.
62. Impairment losses
Unit: yuan
Item Reporting period Same period of last year
I. Bad debts losses 5,948,409.80 7,164,574.34
II. Inventory falling price losses -660,846.16 5,550,447.56
Total 5,287,563.64 12,715,021.90
63. Non-operating gains
(1)
Unit: yuan
The amount included in the
Item Reporting period Same period of last year current non-recurring gains
and losses
Total gains from disposal of non-current
28,954.04 10,418.16 28,954.04
assets
Including：Gains from disposal of fixed
28,954.04 10,418.16 28,954.04
assets
Government grants 1,142,978.13 543,888.89 1,142,978.13
Penalty income 34,395.00 75,630.00 34,395.00
Other 25,424.40 221,544.01 25,424.40
Total 1,231,751.57 851,481.06
(2) List of government grants
Unit: yuan
Item Reporting period Same period of last year Note
ECQF [2006] No. 170 government
Grants for the project of replacing
388,333.34 388,333.34 grants for replacement of acute toxic
acute toxic pesticide in farming
pesticide in farming
Special subsidies of sewage source
122,222.22 122,222.22 JHBKW [2009]No. 15
processing
Special fund deferred of turn
33,333.33 33,333.33 Sewage treatment funds
environmental protection
Appropriation for CTC consuming Department of Environmental
599,089.24
and eliminating project Protection
Total 1,142,978.13 543,888.89 --
Notes:
64. Non-operating expenses
114
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Unit: yuan
The amount included in
Item Reporting period Same period of last year the current non-recurring
gains and losses
Loss on disposal of non-current assets 614,366.72 327,787.29
Including: Loss on disposal of fixed assets 614,366.72 327,787.29
Loss on debt reconstruction 152,001.61
Penalty, overdue fine 130,000.00
Other 2,030,841.39 390,958.16
Total 2,797,209.72 848,745.45
Notes:
65. Income tax expense
Unit: yuan
Item Reporting period Same period of last year
Current income tax expense accounted by tax and relevant
45,206,674.61 12,195,363.18
regulations
Adjustment of income tax -1,235,675.56 -523,711.82
Total 43,970,999.05 11,671,651.36
66. Calculation procedure of basic earnings per share and diluted earnings per share
EPS-basic refers to the current net profit attributable to common shareholders of the Company divided the
weighted average amount of outstanding issued common shares. The amount of newly issued common shares is
calculated from the date of consideration receivable in accordance with the detailed terms of the contract for
issuing shares.
The numerator of EPS-diluted is the current net profit attributable to common shareholders of the Company,
which is fixed by adjusting the following factors: (1) the interest of diluted potential common shares which is
recognized as the expenses of current period; (2) the gains and costs incurred from transferring the diluted
potential common shares; and (3) the influence on income tax from the above adjustment.
The denominator is the sum of the two items as follows: (1) the weighted average amount of common shares
issued by the Parent Company in EPS-basic; (2) the increased weighted average amount of common shares
assuming that diluted potential common shares were transferred to common shares.
While calculating the increased weighted average amount of common shares resulting from that diluted potential
common shares were transferred to issued common shares, the diluted potential common shares issued in previous
period are assumed to be transferred at current period; the diluted potential common shares issued in current
period are assumed to be transferred on the issuing date.
(1) Breakdown of basic earnings per share (EPS-basic) and diluted earnings per share (EPS-diluted) in current and
previous periods.
Profit as of reporting period The reporting period Same period of last year
EPS-basic EPS-diluted EPS-basic EPS-diluted
Net profits attributable to 0.2146 0.2146 0.0404 0.0404
common shareholders of the
Company
0.2166 0.2166 0.0404 0.0404
115
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Net profits attributable to
common shareholders of the
Company after deducting
non-recurring gains and
losses
(2) Explanation on counting process of EPS-basic and EPS-diluted
During the reporting period, there were no diluted potential common shares in the Company so that EPS-diluted
equaled to EPS-basic.
①When calculated the EPS-basic; the net profits attributable to common shareholders were as follows:
Item The reporting period Same period of last year
127,470,524.25 23,986,378.19
Net profit attributable to common
shareholders of the Company
Of which ： Net profit attributable to 127,470,524.25 23,986,378.19
continual operating
Net profit attributable to
discontinued operating
128,673,087.74 23,972,136.64
Net profit attributable to common
shareholders of the Company after
deducting non-recurring gains and losses
Of which ： Net profit attributable to 128,673,087.74 23,972,136.64
continual operating
②When calculated the EPS-basic, the denominator refers to the weighted average amount of outstanding issued
common shares, and the accounting process as follows:
Item The reporting period Same period of last year
593,923,220.00 593,923,220.00
Amount of outstanding issued common shares at year-begin
Add：weighted average amount of common shares issued in
this year
Deduct ： weighted average amount of common shares
repurchased in this year
Weighted average amount of outstanding issued common 593,923,220.00 593,923,220.00
shares at year-end
67. Other comprehensive income
Naught
68. Notes of Cash Flow Statement
(1) Other cash received relevant to operating activities
Unit: yuan
Item Amount
Interest income 1,985,918.11
Turnover accounts of Huaxiang Company 11,000,000.00
116
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Allowance for payment and others, etc. 7,658,935.40
Total 20,644,853.51
Notes:
(2) Other cash paid relevant to operating activities
Unit: yuan
Item Amount
Transportation fees 18,060,547.63
Pollution discharge fees 5,691,318.00
Insurance expenses 2,793,250.85
Terminal charges 1,990,585.40
Utilities 1,698,913.58
Entertainment expenses 1,467,162.48
Office expenses 963,403.31
Travel expenses 643,279.59
Vehicle use expenses 548,369.52
Other 5,344,754.71
Total 39,201,585.07
Notes:
(3) Other cash received relevant to investment activities
Naught
(4) Other cash paid relevant to investment activities
Naught
(5) Other cash received relevant to financing activities
Naught
(6) Other financial activities-related cash paid
Unit: yuan
Item Amount
Loan guarantee fees paying for Sanonda Group Co., Ltd. 2,880,000.00
Loan guarantee fees paying for China National Agrochemical Corporation 6,000,000.00
Purchasing consideration of subsidiaries under the same control 5,906,730.00
Fees for foreign exchange pledged without recourse 738,371.46
Margin of notes payable 16,000,000.00
Total 31,525,101.46
Notes:
69. Supplementary information to cash flow statement
(1) Supplementary information to cash flow statement
Unit: yuan
Supplemental information Reporting period Same period of last year
1. Reconciliation of net profit to net cash flows generated
-- --
from operating activities
Net profit 126,676,986.77 24,465,869.54
117
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Add: Provision for impairment of assets 5,287,563.64 12,715,021.90
Depreciation of fixed assets, of oil-gas assets, of productive
79,195,918.91 66,387,015.57
biological assets
Amortization of intangible assets 2,016,029.78 2,040,404.10
Losses on disposal of property, plant and equipment,
intangible assets and other -585,412.68 317,369.63
long-term assets (gains: negative)
Financial cost (income: negative) 38,686,606.16 34,133,741.20
Investment loss (gains: negative) -2,254,182.43
Decrease in deferred tax assets (increase: negative) -1,235,675.56 -523,711.82
Increase in deferred tax liabilities (decrease: negative) 16,204,479.51 17,366,916.08
Decrease in inventory (increase: negative) -114,627,321.89 -154,943,182.38
Decrease in accounts receivable from operating activities
272,788,131.62 130,268,085.35
(increase: negative)
Increase in accounts payable from operating activities
422,153,123.84 132,227,529.17
(decrease: negative)
Net cash flows generated from operating activities -- --
2. Significant investing and financing activities without
-- --
involvement of cash receipts and payments
3. Change of cash and cash equivalent: 549,722,485.68 391,575,662.00
Closing balance of Cash 175,181,365.77 219,587,687.99
Less: opening balance of cash 374,541,119.91 171,987,974.01
(2) Relevant information of acquisition or disposal of subsidiaries and other operation entities in the
reporting period
Unit: yuan
Supplemental information Reporting period Same period of last year
I. Relevant information on acquisition of subsidiaries and
-- --
other operation entities:
II. Relevant information on disposal of subsidiaries and
-- --
other operation entities
(3) Composition of cash and cash equivalents
Unit: yuan
Item Reporting period Same period of last year
I. Cash 549,722,485.68 175,181,365.77
Including: Cash on hand 21,558.81 1,347.21
Bank deposit on demand 549,700,926.87 175,180,018.56
II. Closing balance of cash and cash equivalents 549,722,485.68 175,181,365.77
Notes:
70. Notes on projects on statement of change in equity
Information on “other” item names when regulating the year end balance of last year and amount adjustment, and
retroactive adjustment incorporated and produced by the enterprise under the same control:
VIII. Accounting treatment of asset securitization business
118
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
1. Information on main transaction arrangement of asset securitization and clauses of accounting treatment
and bankruptcy remoteness
Naught
2. The Company does not have the control power, but of which in principle the company bears the risk with
special purpose.
Naught
IX. Related party and related Transaction
1. Information related to parent company of the Company
Unit: yuan
Proportion
Proportion
of voting
of share
rights The
held by
Name of Legal Name of owned by ultimate
Relationsh Registratio Business parent Organizati
parent Type representat parent parent controller
ip n of place scope company on code
company ive company company of the
against the
against the Company
Company
Company
(%)
(%)
Production
and
93 Beijing
Sanonda operation
East Road,
Group Parent State-owne Li of 240,661,00 17898778
Jingzhou, 20.15% 20.15% SASAC
Corporatio company d company Zuorong pesticide 0.00 9
Hubei
n and
Province
chemicals
products
Information on the parent company:
China National Chemical Corporation (hereinafter referred to as “Chemical Corporation”) holds 100.00%
equity of China National Chemical Corporation, and it’s a central enterprise under the control of SASA
C.
2. Information on subsidiaries of the Company
Unit: yuan
Legal Proportion Proportion
Business Registration Business Registered Organizatio
Name Type representati of holding of voting
Type of place scope capital n code
ve shares (%) rights (%)
Sanonda
(Jingzhou)
wholly-own Limited
Pesticides Deng Tian Manufacturi
ed Liability 30,000,000 100% 100% 181860033
and Guobin Xueqing ng
subsidiary Company
Chemicals
Co., Ltd.
Hubei wholly-own Limited Zhang
Li Zuorong Trading 10,000,000 100% 100% 706963167
Sanonda ed Liability Shaochun
119
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Foreign subsidiary Company
Trading
Co., Ltd.
Hubei
Sanonda Ti wholly-own Limited
Manufacturi
anmen ed Liability Tianmen Xie Chengli 30,000,000 100% 100% 181851778
ng
Agrochemic subsidiary Company
al Co., Ltd.
Jingzhou
wholly-own Limited
Longhua Pe Manufacturi
ed Liability Jingzhou Liu Anping 5,000,000 65% 65% 757019360
trochemical ng
subsidiary Company
Co., Ltd.
Jingzhou
wholly-own Limited
Huaxiang Manufacturi
ed Liability Jingzhou Yin Hong 40,000,000 98.5% 98.5% 178987789
Chemical ng
subsidiary Company
Co., Ltd.
3. Information on co-operated or joint operated of the Company
Unit: yuan
Legal Proportion Proportion
Business Registration Business Registered Relationshi Organizatio
Item representati of holding of voting
Type place scope capital p n code
ve shares (%) rights (%)
I. Co-operated
II. Joint operated
4. Information on other related parties
Name of other related parties Relationship with the Company Organization code
China National Chemical Finance Co., Ltd. Controlled by the same chemical group 10112351X
Hubei Jingzhou Huaxiang Chemical Co.,
Affiliated enterprise of parent company 73713373X
Ltd.
Guangxi Hechi Chemicals Co., Ltd. Controlled by the same chemical group 200887558
Jiangsu Anpon Electrochemical Co., Ltd. Controlled by the same chemical group 139433337
Bluestar (Beijing) Chemical Machinery
Controlled by the same chemical group 795955432
Co., Ltd.
Bluestar Environmental Engineering Co.,
Controlled by the same chemical group 71092737X
Ltd.
Makhteshim Chemical Works Ltd. Controlled by the same chemical group
Jiamusi Heilong Pesticide & Chemical
Controlled by the same chemical group 716686183
Corporation
Shandong Dacheng Pesticide & Chemical
Controlled by the same chemical group 164102345
Corporation
Information on other related parties
5. Transaction of related parties
(1) Information sheet of purchasing goods and receiving services
Unit: yuan
Name of company Content of related Pricing principle of Amount of this period Amount of last period
120
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
transaction related parties Proportio Proportio
n in n in
Amount transactio Amount transactio
ns of the ns of the
same kind same kind
Sanonda Group Purchase of raw
Market price 2,282,015.28 0.19% 1,426,054.20 0.15%
Corporation materials
Jingzhou Sanonda Purchase of wrappag
Market price 2,481,724.84 0.26%
Advertising Co., Ltd. e
Bluestar
Environmental Purchase of raw
Market price 13,500.00
Engineering Co., materials
Ltd.
China National
Purchase of raw
Agrochemical Market price 8,227,400.00 0.86%
materials
Corporation
Hubei Jingzhou
Low consumption
Huaxiang Chemical Market price 1,068,201.65 0.09%
goods
Co., Ltd.
List of sales of good and receive of service
Unit: yuan
Amount of this period Amount of last period
Proportio Proportio
Content of related Pricing principle of n in n in
Name of company
transaction related parties Amount transactio Amount transactio
ns of the ns of the
same kind same kind
Sales of chemical ma
Sanonda Group
terials Market price 2,131,405.13 0.14% 2,569,788.52 0.23%
Corporation
China National
Agrochemical Sales of pesticides Market price 3,972,713.50 0.35%
Corporation
Jiangsu Anpon
Electrochemical Co., Sales of pesticides Market price 2,513,274.34 0.17% 3,360,000.00 0.3%
Ltd.
Hubei Jingzhou
Sales of dynamic
Huaxiang Chemical Market price 4,555,930.97 0.3% 9,864,000.00 0.88%
chemical
Co., Ltd.
Jiamusi Heilong
Pesticide &
Sales of pesticides Market price 4,434,955.75 0.29%
Chemical
Corporation
121
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Shandong Dacheng
Pesticide &
Sales of pesticides Market price 2,444,247.79 0.16%
Chemical
Corporation
Makhteshim
Chemical Works Sales of pesticides Market price 8,797,829.52 0.58%
Ltd.
(2) Related deposit/contract
Naught
(3) Related leased items
Leased items of the company
Unit: yuan
The lease income
Category of Pricing evidence
Name of lesser Name of lessee Start date of lease End date of lease confirmed in the
leased assets of lease income
report period
Hubei Sanonda Sanonda Group 7th floor of the
1, Jan, 2011 31, Dec, 2013 Agreement 120,000.00
Co., Ltd. Company office building
Leased items of the company
Naught
(4) Related-party guarantee
Unit: yuan
Execution
Guarantor Secured party Guarantee amount Start date End date
accomplished or not
Sanonda Group
The Company 50,000,000.00 31, Oct, 2012 30, Nov, 2015 No
Corporation
Sanonda Group No
The Company 240,000,000.00 1, Feb, 2013 31, Jan, 2016
Corporation
Sanonda Group No
The Company 98,000,000.00 25, Dec, 2012 24, Dec, 2017
Corporation
China National No
Agrochemical The Company 300,000,000.00 3, Sep, 2012 3, Sep, 2015
Corporation
China National No
Agrochemical The Company 50,000,000.00 29, Jan, 2013 30, July, 2016
Corporation
China National No
Agrochemical The Company 150,000,000.00 6, May, 2011 6, July, 2015
Corporation
China National No
Chemical The Company 100,000,000.00 28, July, 2008 28, Aug, 2015
Corporation
China National The Company 100,000,000.00 28, July, 2008 9, Feb, 2016 No
122
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Chemical
Corporation
China National No
Chemical The Company 100,000,000.00 14, Mar, 2012 14, Mar, 2015
Corporation
China National No
Chemical The Company 100,000,000.00 12, Dec, 2012 12, Dec, 2016
Corporation
Hubei Sanonda No
The Company Foreign Trade Co., 61,200,000.00 31, Dec, 2012 29, Dec, 2013
Ltd.
Hubei Sanonda No
The Company Foreign Trade Co., 108,000,000.00 16, Dec, 2011 23, Jun, 2013
Ltd.
Hubei Sanonda No
The Company Foreign Trade Co., 27,000,000.00 4, Dec, 2009 4, Dec, 2014
Ltd.
Hubei Sanonda No
The Company Foreign Trade Co., 30,600,000.00 10, Dec, 2010 10, Dec, 2013
Ltd.
Hubei Sanonda No
The Company Foreign Trade Co., 27,000,000.00 9, Mar, 2011 8, Mar, 2014
Ltd.
Hubei Sanonda No
The Company Foreign Trade Co., 50,000,000.00 22, Jan, 2013 21, Jan, 2017
Ltd.
Hubei Sanonda No
The Company Foreign Trade Co., 27,000,000.00 26, Dec, 2012 30, Sep, 2013
Ltd.
Hubei Sanonda No
The Company Foreign Trade Co., 27,000,000.00 12, Mar, 2013 12, Mar, 2004
Ltd.
Information on related-party guarantee:
Mainly is the Guarantee for loans for the Hubei Sanonda Foreign Trade Co., Ltd. provided by the holding
subsidiaries, and it’s the maximum amount of guarantee offered by the Company’s trade finance act of opening
letters of credit and documentary credit etc, Guarantee for loans is mainly provided by Sanonda Group
Corporation, China National Agrochemical Corporation and China National Chemical Corporation.
(5) Inter-bank lending capital by related party
Naught
(6) Asset assignment and debt restructuring of related party
Unit: yuan
Transaction Transaction Pricing type for Amount for current period Amount for last period
Related party type by content by related related party Occupanc Occupanc
Amount Amount
related party transaction y of y of
123
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
party proportio proportio
n amount n amount
of similar of similar
transactio transactio
n (%) n (%)
(7) Other related transactions
Amount for current period Amount for last period
Occupanc Occupanc
Transaction y of y of
Transaction Pricing type for
type by proportio proportio
Related party content by related related party
related Amount n amount Amount n amount
party transaction
party of similar of similar
transactio transactio
n (%) n (%)
Shanonda Group Pay for guarantee
Guarantee Agreement price 2,880,000.00 32.43 3,600,000.00 52.48
Co., Ltd. fees
China National
Pay for guarantee
Agrochemical Guarantee Agreement price 6,000,000.00 67.57 2,700,000.00 42.52
fees
Corporation
Jingzhou
Huaxiang Bank borrowing
Loan Loan 11,000,000.00 100 10,000,000.00 100
Chemical Co., rates
Ltd.
Jingzhou
Huaxiang Bank borrowing
Interest Interest 422,500.00 100 466,666.32 100
Chemical Co., rates
Ltd.
6. Accounts receivable and payable of related parties
Accounts receivable and prepaid of listed related parties
Unit: yuan
Closing amount Opening amount
Item Related party Bad-debt provisio
Book balance Book balance Bad-debt provision
n
Makhteshim
Accounts payable 6,450,394.75 322,519.74 9,228,873.94 461,443.70
Chemical Works Ltd
Jiamusi Heilong
Accounts payable Pesticide & Chemical 5,011,500.40 250,575.02
Corporation
Accounts payable Shandong Dacheng 42,000.00 2,100.00
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Pesticide & Chemical
Corporation
Accounts payable and received in advance of listed related parties
Unit: yuan
Item Related party Closing amount Opening amount
Bluestar (Beijing) Chemical
Accounts payable 78,000.00 128,000.00
Machinery Co., Ltd.
China National Agrochemical
Accounts received in advance 0.00 35,183.75
Corporation
Hubei Jingzhou Huaxiang
Accounts received in advance 592,267.99
Chemical Co., Ltd.
Hubei Jingzhou Huaxiang
Other accounts payable 11,000,000.00
Chemical Co., Ltd.
X. Share-based payments
Naught
XI. Contingencies
1. Contingent liability and financial impacts caused by pending action or arbitration
Naught
2. Contingent liability and financial impacts caused by provision of guarantee for other company
Unit: yuan
Total guarantee
Overdue Guarantee Current status of
Guarantor Secured entities amount Guarantee type
amount way secured entities
(RMB ’0000)
I. Guarantee for subsidiaries
Hubei Sanonda Foreign 35,780.00 Joint Guarantee for trade Business-as-usu
The
Trading Co., Ltd. liability financing loan al
Company
guarantee
On January 11th, Guangxi Hechi Chemical Co., Ltd had paid back the interests and loans of Hechi branch of
Agricultural Bank of China, which guaranteed by the company in full. Up to now, the guarantee for the Guangxi
Hechi Chemical Co., Ltd by the company had terminated.
Other contingencies
The Company has no other contingencies that need to be disclosed.
XII. Commitments
1. Significant commitments
As of 30, Jun, 2013, the Group has no significant commitments needed to be disclosed.
2. Fulfillment of the previous commitments
Naught
XIII. Events after the balance sheet date
1. Significant events after the balance sheet date
Naught
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
2. List of profits distribution events after the balance sheet date
Naught
3. Other assets and liabilities events after the balance sheet date
On 29, July, 2013，the Company received the announcement from the China National Chemical Agroche
mical Corporation. Because the latter proposed planning significant matters which involving the Company,
for Safeguarding the interests of investors, after the application of the Company, the stork(Shanonda A
000553, Shanonda B 20553)had suspended from the opening order on 30, July, 2013, and would be resu
bmitted after the Company issues the relevant announcement.
XIV. Other significant events
1. Non-monetary assets exchange
Naught
2. Debt restructuring
The total losses owning to the debt restructuring of the subsidy of the Company—Shanonda (Jingzhou)
Agrochemical Co., Ltd. is RMB 152001.61 in this year. Because all kinds of the elements such as the ageing is
too long, the backlog of goods, products expired, transportation difficulties, damaged packaging, returns
difficulties, the relevant customers of the Company would face the risk of the uncollectible situation of payable
accounts. Through positive efforts, the Company had made several times of debt restructuring negotiations with
all relevant customers, and had reached effective debt restructuring negotiations agreements in the end. According
to the convention of the debt restructuring, the Company had reduced the accounts payable of the relevant entities
of RMB 152001.61,and the remain payments for goods had been took back.
3. Business combination
Naught
4. Leasing
Naught
5. Financial instruments which is outstanding and can be converted into shares at the period-end
Naught
6. Main contents and significant changes of the pension plan
Naught
7. Others
Naught
XV. Notes to the financial statements of Parent Company
1. Accounts receivable
(1) Accounts receivable
Unit: yuan
Closing balance Opening balance
Book value Provision for bad debts Book value Provision for bad debts
Items
Propo Proporti Proporti Proporti
Amount Amount Amount Amount
rtion on on on
Account receivable with consolidated provision for bad debt
66.58
Related group 144,363,480.70 162,630,166.79 93.94%
%
Aging group 72,457,494.77 33.42 10,586,017.16 14.61% 10,494,535.23 6.06% 7,404,568.43 70.56%
126
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
%
Subtotal of consolidation 216,820,975.47 100% 10,586,017.16 4.88% 173,124,702.02 100% 7,404,568.43 4.28%
Total 216,820,975.47 -- 10,586,017.16 -- 173,124,702.02 -- 7,404,568.43 --
Notes to type of account receivable:
1. According to the rules of the Company, the accounts receivable with the amount of RMB 5 million or more,
would be confirmed as individual significant receivable accounts.
2. Three categories of the receivable accounts according to the groups:
(1) Related group: Divided according to the relationship between the debtor and the Company etc (Always refers to the actual
controller of the Company and the other enterprises under its control);
(2) Risk-free group: Divided according to the debtor reputation, money properties, transaction safeguards etc (Always refers
to the accounts receivables of the government procurement funds, the staff impress contract deposit, the warranties setting
s etc)
(3) Aging group: Divided according to the aging of the accounts receivable;
3. The group had made individually impairment of the insignificant individual amounts which had the following characteris
tics. If there are objective evidences indicated that had impairment, according to the differences between the present value
of future cash flow and its book value, would be confirmed of the impairment losses and the provision for bad debts pr
eparation (For example: the accounts receivable of the litigation and arbitration owning to the disputation with the other p
arty; or there are evident signs indicated that the debtor would be not likely to fulfill the repayment obligations of receiva
bles)
Account receivable with large individual amount and provision for bad debt at the end of period
□ Applicable √ Not applicable
Account receivable in the consolidation with provision for bad debt by aging analysis method:
√ Applicable □ Not applicable
Unit: yuan
Closing balance Opening balance
Book balance Book balance
Aging Provision for bad Provision for bad
Proporti Proporti
Amount debts Amount debts
on on
Within 1 year
Including: -- -- -- -- -- --
Subtotal 64,435,861.67 88.93% 3,221,793.08 2,424,887.63 23.11% 121,244.38
1 to 2 years 443,852.05 0.61% 44,385.21 696,400.02 6.64% 69,640.00
2 to 3 years 308,204.15 0.42% 92,461.25 84,398.54 0.8% 25,319.56
Over 3 years 7,269,576.90 10.04% 7,227,377.63 7,288,849.04 69.45% 7,188,364.49
3 to 4 years 84,398.54 0.12% 42,199.27
4 to 5 years 200,969.11 1.91% 100,484.56
Over 5 years 7,185,178.36 9.92% 7,185,178.36 7,087,879.93 67.54% 7,087,879.93
Total 72,457,494.77 -- 10,586,017.16 10,494,535.23 -- 7,404,568.43
Account receivable in the consolidation with provision for bad debt by balance percentage method:
□ Applicable √ Not applicable
Account receivable in the consolidation with provision for bad debt by other method:
√Applicable □Not applicable
127
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Unit RMB Yuan
Name of group Book balance Bad debt provision
Related party combination 144,363,480.70 0.00
Total 144,363,480.70 0.00
Accounts receivable with insignificant single amount but independently withdrawn bad debts provision:
□ Applicable √ Inapplicable
(2) No accounts receivable returned or collected during the reporting period
(3) No accounts receivable actual offset during the reporting period
(4) No accounts receivable due from shareholders with 5% (including 5%) voting right of the Company
(5) Nature or content of other accounts receivable with significant amount
The other accounts receivable with significant amount are mainly the outgoing and incoming payment for goods by the subsidiary.
(6) Accounts receivable due to the top five entities
Unit: RMB Yuan
Occupancy rate of the
Relationship with the
Name of company Amount Period total amount of accounts
Company
receivable (%)
Hubei Sanonda Foreign
Related party of merger 112,469,473.53 Within one year 51.87%
Trading Co., Ltd.
Jingzhou Hongxiang
Related party of merger 31,894,007.17 Within one year 14.71%
Chemicals Co., Ltd.
Under the same control
Jiamusi Heilong
of the Chinese chemical 5,011,500.40 Within one year 2.31%
Agrochemicals Co., Ltd.
industry group co., LTD
Zhejiang Hangzhou
Xingzhi chemical co.,
Independent third party 3,289,876.29 Within one year 1.52%
LTD
Yunnan kunming
Independent third party 2,689,240.00 Within one year 1.24%
chemicals co., LTD
Total -- 155,354,097.39 -- 71.65%
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
（7）Accounts receivable due to the related parties
Unit: RMB Yuan
Occupancy rate of the total
Name of company Relationship with the Company Amount amount of accounts receivable
(%)
Hubei Sanonda Foreign
Subsidiary of the company 112,469,473.53 51.87%
Trading Co., Ltd.
Jingzhou Hongxiang
Subsidiary of the company 31,894,007.17 14.71%
Chemicals Co., Ltd.
Under the same control of the
Jiamusi Heilong
Chinese chemical industry 5,011,500.40 2.31%
Agrochemicals Co., Ltd.
group co., LTD
Under the same control of the
Shandong Dacheng
Chinese chemical industry 42,000.00 0.02%
agrochemical co., LTD
group co., LTD
Total -- 149,416,981.10 68.91%
2. Other accounts receivable
（1）Other accounts receivable
Unit: RMB Yuan
Closing balance Opening balance
Book balance Bad debt provision Book balance Bad debt provision
Category Propo Propo Propo Propo
Amount rtion Amount rtion Amount rtion Amount rtion
(%) (%) (%) (%)
Other accounts receivable withdrawn for provision of bad debt in the groups
95.53 95.68
Related-party group 140,055,853.07 145,446,597.26
% %
Risk-free group 100,049.49 0.07% 63,795.01 0.04%
82.55 82.63
Aging group 6,444,513.98 4.4% 5,319,783.35 6,507,313.11 4.28% 5,376,873.00
% %
Subtotal of the group 146,600,416.54 100% 5,319,783.35 3.63% 152,017,705.38 100% 5,376,873.00 3.54%
Total 146,600,416.54 -- 5,319,783.35 -- 152,017,705.38 -- 5,376,873.00 --
Explanation on categories of other accounts receivable
Other accounts receivable with insignificant single amount but independently withdrawn bad debts provision at period-end
□ Applicable √ Inapplicable
In the group, other accounts receivable withdrawn bad debt provision by adopting aging analysis
129
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
√Applicable □ Inapplicable
Unit: RMB Yuan
Closing balance Opening balance
Age Book balance Book balance
Proporti Bad debt provision Proporti Bad debt provision
Amount Amount
on (%) on (%)
Within 1 year
Including: -- -- -- -- -- --
Subtotal within
978,764.72 15.19% 48,938.23 1,016,623.85 15.62% 50,831.19
1 year
1-2 years 187,510.00 2.91% 18,751.00 100,000.00 1.54% 10,000.00
2-3 years 19,761.60 0.31% 5,928.48 35,210.65 0.54% 10,563.20
Over 3 years 5,258,477.66 81.59% 5,246,165.64 5,355,478.61 82.3% 5,305,478.61
3-4 years 24,624.05 0.38% 12,312.03
4-5 years 100,000.00 1.54% 50,000.00
Over 5 years 5,233,853.61 81.21% 5,233,853.61 5,255,478.61 80.76% 5,255,478.61
Total 6,444,513.98 -- 5,319,783.35 6,507,313.11 -- 5,376,873.00
In the group, the other accounts receivable using balance percentage method for withdrawing provisions for bad debt:
□ Applicable √ Inapplicable
In the group, the accounts receivable were using other methods for withdrawing provisions for bad debt:
√Applicable □Inapplicable
Unit: RMB Yuan
Name of group Book balance Bad debt provision
Related-party group 140,055,853.07 0.00
Risk-free group (Export tax refund receivable and
100,049.49 0.00
reserve funds)
Total 140,155,902.56 0.00
Other accounts receivable with insignificant single amount but independently withdrawn bad debts provision:
□ Applicable √ Inapplicable
(2) Other accounts receivable returned or collected during the reporting period
No
(3) No accounts receivable actual offset during the reporting period
No
130
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
(4) Other accounts receivable due from shareholders with 5% (including 5%) voting right of the Company
during the reporting period
No
(5) Nature or content of other accounts receivable with significant amount
No
(6) Other accounts receivable due to the top five entities
Unit: RMB Yuan
Proportion in the total
Relationship with the
Name of entity Amount Years other accounts receivable
Company
(%)
Jingzhou Hongxiang Subsidiary of the
140,000,000.00 1-2year 95.5%
Chemicals Co., Ltd. Company
Shantou Biyue Plastic
Non-related party 3,125,000.00 Over 5 year 2.13%
Co., Ltd.
Hubei Jingzhou Shashi
Agricultural Means of Non-related party 548,500.00 Over 5 year 0.37%
Production Co., Ltd.
Jingzhou production
Non-related party 300,000.00 Over 5 year 0.21%
safety supervision bureau
Jingzhou real estate
Non-related party 237,784.57 Within one year 0.16%
administration
Total -- 144,211,284.57 -- 98.37%
(7) Other accounts receivable due to the related parties
Unit: RMB Yuan
Proportion in the total other
Name of entity Relationship with the Company Amount
accounts receivable (%)
Sanonda (Jingzhou) Pesticide
Subsidiary of the company 55,853.07 0.04%
& Chemicals Co., Ltd.
Jingzhou Hongxiang
Subsidiary of the company 140,000,000.00 95.5%
Chemicals Co., Ltd.
Total -- 140,055,853.07 95.54%
3. Long-term equity investment
Unit: RMB Yuan
131
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Reasons
for
inconfor
mity Withdraw
Sharehold Voting
between al of
Increasin ing power Cash
Accounti Initial Sharehold Depreciat depreciati
Opening g or Closing proportio proportio dividends
Investee ng investmen ing ion on
balance decreasin balance n for n for for this
method t cost proportio reserves reserves
g amount investee investee period
n and for this
(%) (%)
Voting period
power
proportio
n
Sanonda
(Jingzhou
)
Pesticide Cost 25,500,00 27,500,00 2,913,700 30,413,70 24,500,00
100% 100%
& method 0.00 0.00 .00 0.00 0.00
Chemical
s Co.,
Ltd.
Hubei
Sanonda
Tianmen Cost 7,245,023 21,296,32 21,296,32
100% 100%
Agroche method .32 3.32 3.32
mical
Co., Ltd.
Jingzhou
Longhua
Cost 3,250,000 3,250,000 3,250,000 650,000.0
Petroche 65% 65%
method .00 .00 .00 0
micals
Co., Ltd.
Hubei
Sanonda
Cost 9,000,000 9,000,000 2,993,030 11,993,03
Foreign 100% 100%
method .00 .00 .00 0.00
Trading
Co., Ltd.
Hubei Cost 20,000,00 20,000,00 20,000,00 11,991,01 2,254,182
1.18% 1.18%
Bank method 0.00 0.00 0.00 7.37 .43
Hubei
Shendian Cost 564,000.0 564,000.0 564,000.0
0.6% 0.6%
Auto method 0 0 0
Motor
132
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Co., Ltd
Guangxi
Zhongdin Cost 580,800.0 580,800.0 580,800.0
1.41% 1.41%
g Holding method 0 0 0
Co., Ltd
Jingzhou
Hongxian
g Cost 37,619,90 37,619,90 37,619,90
98.5% 98.5%
Chemical method 5.41 5.41 5.41
s Co.,
Ltd.
103,759,7 119,811,0 5,906,730 125,717,7 36,491,01 2,904,182
Total -- -- -- --
28.73 28.73 .00 58.73 7.37 .43
Note
4. Operating revenue and operating cost
(1) Operating revenue
Unit: RMB Yuan
Item Amount of this period Amount of last period
Main operation revenue 1,460,017,357.58 1,004,601,707.14
Other operation revenue 36,547,430.39 20,442,618.50
Total 1,496,564,787.97 1,025,044,325.64
Main operating cost 1,204,298,974.60 886,916,094.18
(2) Main business (classified by industries)
Unit: RMB Yuan
Amount of this period Amount of last period
Name of Industries
Operating revenue Operating cost Operating revenue Operating cost
Manufacturing of chemical
1,460,017,357.58 1,174,092,436.40 1,004,601,707.14 870,151,801.30
raw material and chemicals
Total 1,460,017,357.58 1,174,092,436.40 1,004,601,707.14 870,151,801.30
(3) Main business (classified by products)
Unit: RMB Yuan
Amount of this period Amount of last period
Name of Products
Operating revenue Operating cost Operating revenue Operating cost
Agrochemicals such as 1,451,653,596.88 1,169,371,039.84 996,311,279.98 865,895,132.66
133
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
chemical fertilizer and
pesticide
New chemical material and
8,363,760.70 4,721,396.56 8,290,427.16 4,256,668.64
special chemicals
Total 1,460,017,357.58 1,174,092,436.40 1,004,601,707.14 870,151,801.30
(4) Main business (classified by regions)
Unit: RMB Yuan
Amount of this period Amount of last period
Name of region
Operating revenue Operating cost Operating revenue Operating cost
Domestic 746,239,308.85 583,055,078.00 537,302,205.33 449,298,299.75
Overseas 713,778,048.73 591,037,358.40 467,299,501.81 420,853,501.55
Total 1,460,017,357.58 1,174,092,436.40 1,004,601,707.14 870,151,801.30
(5) Operating revenue from the top five customers of the Company
Unit: RMB Yuan
Proportion in total
Name of customer Total operating revenue
operating revenue (%)
Foreign customer A 106,360,893.33 7.11%
Domestic customer B 68,362,599.73 4.57%
Foreign customer C 65,241,195.21 4.36%
Foreign customer D 64,331,022.91 4.3%
Foreign customer E 47,513,952.00 3.17%
Total 351,809,663.18 23.51%
Note
5. Investment income
(1) Details of investment income
Unit: RMB Yuan
Item Amount of this period Amount of last period
Long-term equity investment income assessed by cost
2,904,182.43 650,000.00
method
Total 2,904,182.43 650,000.00
(2) Long-term equity investment income assessed by cost method
Unit: RMB Yuan
134
2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Amount of last Reasons for the change of
Investee Amount of this period
period increase/decrease
Jingzhou Longhua Petrochemicals Co., Ltd. 650,000.00 650,000.00
Hubei Bank 2,254,182.43
Total 2,904,182.43 650,000.00 --
(3) Long-term equity investment income assessed by equity method
Unit: RMB Yuan
Amount of last Reasons for the change of
Investee Amount of this period
period increase/decrease
Note
6. Supplementary information to cash flow statement
Unit: RMB Yuan
Item Amount of this period Amount of last period
1. Reconciliation of net profit to net cash flows generated from
-- --
operating activities
Net profit 133,618,521.52 27,846,757.22
Add: Provision for impairment of assets 1,928,293.40 9,241,029.13
Depreciation of fixed assets, of oil-gas assets, of productive
75,545,987.60 64,100,706.10
biological assets
Amortization of intangible assets 1,871,736.54 1,893,403.20
Losses on disposal of fixed assets, intangible assets and other
143,522.51 205,041.84
long-term assets (gains: negative)
Financial cost (gains: negative) 35,999,561.54 35,722,472.77
Investment loss (gains: negative) -2,904,182.43 -650,000.00
Decrease in deferred income tax assets (gains: negative) -671,862.52 186,578.04
Decrease in inventory (gains: negative) 26,008,009.05 -4,724,415.70
Decrease in accounts receivable from operating activities (gains:
-70,194,773.24 -167,244,669.31
negative)
Increase in payables from operating activities (decrease: negative) 249,541,315.12 147,036,351.27
Net cash flows generated from operating activities 450,886,129.09 113,613,254.56
II. Investing and financing activities that do not involving
-- --
cash receipts and payment:
III. Net increase in cash and cash equivalents -- --
Closing balance of cash 437,060,777.43 280,919,823.80
Less: Opening balance of cash 149,485,252.01 178,056,420.12
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Net increase in cash and cash equivalents 287,575,525.42 102,863,403.68
7. Assets and liabilities in assessed value under reverse purchase
Naught
XIV. Supplementary information
1 Items and amounts of extraordinary gains and losses
Unit: RMB Yuan
Item Amount Note
Gain/loss on the disposal of non-current assets (including the
-585,412.68
offset part of the asset impairment provisions)
Government grants recognized in the current period, except for
those acquired in the ordinary course of business or granted at
1,142,978.13
certain quotas or amounts according to the government’s unified
standards
Debt restructuring gains or losses -152,001.61
Non-operating income and expense other than the above -1,971,021.99
Income tax effects -391,364.54
Minority interests effects (after tax) 28,469.88
Total -1,202,563.49 --
Explain the reasons if the Company classifies an item as an extraordinary gain/loss according to the definition in the Explanatory
Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Extraordinary Gains and
Losses, or classifies any extraordinary gain/loss item mentioned in the said explanatory announcement as a recurrent gain/loss item
□ Applicable √ Inapplicable
2. Differences between accounting data under domestic and overseas accounting standards
(1) Differences of net profit and net assets disclosed in financial reports prepared under international and
Chinese accounting standards
Unit: RMB Yuan
Net profit attributable to shareholders of the Net assets attributable to shareholders of the
Company Company
2013 2012 Closing amount Opening amount
According to Chinese
127,470,524.25 23,986,378.19 1,350,626,822.89 1,255,536,761.52
accounting standards
Items and amounts adjusted according to international accounting standards
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
(2) Differences of net profit and net assets disclosed in financial reports prepared under overseas and
Chinese accounting standards
Unit: RMB Yuan
Net profit attributable to shareholders of the Net assets attributable to shareholders of the
Company Company
2013 2012 Closing amount Opening amount
According to Chinese
127,470,524.25 23,986,378.19 1,350,626,822.89 1,255,536,761.52
accounting standards
Items and amounts adjusted according to international accounting standards
(3) Explain reasons for the differences between accounting data under domestic and overseas accounting
standards
3. Return on equity and earnings per share
Unit: RMB Yuan
The weighted average ROE EPS
Profit in the reporting period
(%) Basic EPS Basic EPS
Net profit attributable to the Company's
9.66% 0.2146 0.2146
common stock shareholders
Net profit attributable to shareholders of the
Company's common stock after deducting 9.75% 0.2166 0.2166
non-recurring gains and losses
4. Particulars on the abnormal conditions of main items in the financial statements of the Company and
relevant reasons
Unit: RMB Ten thousand
Yuan
Item 2013.6.30 2012.12.31 Increase /decrease amplitude
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
Other accounts payable 5,744 3,137 83.10%
Retained profit 38,700 28,902 33.90%
Note：
1. The money capital increased 222.94% compare to that in the opening period, mainly because the accounts
receivable of sale increased.
2. Accounts receivable increased 43.43% compare to that in the opening period, mainly because the revenue
of sale increased in the reporting period, and most of the settlement of export had right of recourse which
made the period of settlement longer.
3. Payment in advance increased 62.54% compare to that in the opening period, mainly because the payment
in advance of raw material increased in the reporting period.
4. Short-term loan increased 87.24%, mainly because the need of production technology reform amount.
5. Accounts received in advance increased 62.99% compare to the opening period, mainly because the accounts
received in advance from clients for goods in the reporting period.
6. Commission paid to the employee increased 64.81% compare to the opening period, mainly because of the
Senior and middle managers rewards and social security and other fees.
7. Tax payable increased 235.95% compare to that in the opening period, mainly because the payment of income
tax increased.
8. Other accounts payable increased 83.10% compare to that in the opening period, mainly because the company’s borrowing to
Huaxiang Company and the unpaid cost of sales increased in the reporting period.
9. Non-current liabilities with one year decreased 42.13% compare that to the opening period, mainly because the
company paid part of the long-term loan of non-current liabilities.
10. Long- term loan decreased 837.5% compare to that in the opening period, mainly because the company paid
part of the long-term loan in the reporting period.
11. Retained profit increased 33.9% compare to that in the opening period, mainly because the total amount of
profit increased in the reporting period.
Unit: RMB Ten thousand Yuan
Item 2013.6.30 2012.6.30 Increase
/decrease
amplitude
Operating revenue 151,969 111,676 36.08%
Operating tax and surcharge 106 49 116.33%
Asset impairment losses 529 1,272 -58.41%
Non-operating revenue 123 85 44.71%
Non-operating expenses 280 85 229.41%
Income tax expenses 4,397 1,167 276.78%
Net profits attributable to owners of the Company 12,747 2,399 431.35%
1.The operating revenue increased 36.08% on year-on-year basis, mainly because the sales and the price of the
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
products increased.
2. The operating tax and surcharge increased 116.33% on year-on-year basis, mainly because the operating
revenue increased compare to the same period last year.
3. The assets impairment loss decreased 58.41% on year-on-year basis, mainly because provision for decline in
value of inventory decreased in the reporting period.
4. The non-operating revenue increased 44.71% compare to the same period last year, mainly, because the
government subsidies increased in the reporting period.
5. The non-operating expense increased 229.41% compare to the same period last year, mainly because the
non-recourse interest expense increased in the reporting period.
6. The Income tax expenses increased 276.78% compare to the same period last year, mainly because the total
profit increased on years-on-year basis and the income tax increased.
7. Net profits attributable to owners of the Company increased 431.35%，on year-on-year basis, mainly because
the revenue of profit increased and the gross profit rate of sale increased compare to the same period last year.
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
IX. Documents Available For Reference
(I) Financial Statements carried with signatures and seals of Legal Representative and Accounting Principal, as
well as Head of the Accounting Organ;
(II) In the reporting period, originals of all documents of the Company ever disclosed publicly in media
designated by China Securities Regulatory Commission as well as the originals of all the public notices were
deposited in the office of the Company.
HUBEI SANONDA CO., LTD
Legal representative：Li Zuorong
12 August 2013
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2013 Semi-annual Report of Hubei Sanonda Co., Ltd.
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