ADAMA Ltd. Third Quarter Report 2021
Stock Code: 000553(200553) Stock Abbreviation: ADAMA A(B) Announcement No.2021-45
The Company and all members of its board of directors hereby confirm that all
information disclosed herein is true, accurate and complete with no false or misleading
statement or material omission.
ADAMA LTD.
THIRD QUARTER REPORT 2021
ADAMA Ltd. (hereinafter referred to as “the Company”) is a global leader in crop protection,
providing solutions to farmers across the world to combat weeds, insects and disease.
ADAMA has one of the widest and most diverse portfolios of active ingredients in the world,
state-of-the art R&D, manufacturing and formulation facilities, together with a culture that
empowers our people in markets around the world to listen to farmers and ideate from the
field. This uniquely positions ADAMA to offer a vast array of distinctive mixtures,
formulations and high-quality differentiated products, delivering solutions that meet local
farmer and customer needs in over 100 countries globally.
Please see important additional information and further details included in the
Annex.
October 2021
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ADAMA Ltd. Third Quarter Report 2021
Important Notice
The Company’s Board of Directors, Board of Supervisors, directors, supervisors and
senior managers confirm that the content of the Report is true, accurate and
complete and contains no false statements, misleading presentations or material
omissions, and assume joint and several legal liability arising therefrom.
Ignacio Dominguez, the person leading the Company (President and Chief Executive
Officer) as well as its legal representative and the person leading the accounting
function (acting Chief Financial Officer), hereby assert and confirms the truthfulness,
accuracy and completeness of the Financial Report.
All of the Company’s directors attended the board meeting for the review of this
Report.
This Report and its abstract have been prepared in both Chinese and English.
Should there be any discrepancy between the two versions, the Chinese version
shall prevail.
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ADAMA Ltd. Third Quarter Report 2021
I. Main accounting and financial results
1. Whether the Company performs any retroactive adjustments to, or restatements of, its accounting data of last year due
to change in accounting policies or correction of accounting errors
□ Yes√ No
End of Reporting Period End of last year +/- (%)
Total assets (RMB’000) 49,513,607 46,801,034 5.80%
Net assets attributable to shareholders
21,154,363 21,353,752 -0.93%
(RMB’000)
January -
July - September 2021 YoY +/- (%) September YoY +/- (%)
2021
Operating revenues
7,424,584 9.69% 22,488,364 7.65%
(RMB’000)
Net profit attributable to
shareholders of the
(370,952) -1917.59% (3,916) -101.74%
Company (RMB’000)
Net profit attributable to
shareholders of the
Company excluding
non-recurring profit and loss
(384,112) -3989.35% (61,989) -126.99%
(RMB’000)
Net cash flow from
operating activities
(RMB’000) 690,694 338.62% 2,181,987 56.75%
Basic EPS (RMB/share) (0.1592) -1951.39% (0.0017) -101.83%
Diluted EPS (RMB/share) N/A N/A N/A N/A
Weighted average return on
-1.73% -1.83% -0.02% -1.03%
net assets
Please see key additional information and further details included in the Annex
2. Non-Recurring profit/loss
√ Applicable □ Not applicable
Unit: RMB’000
July - September 2021 January - September
Item Note
2021
Gains/losses on the disposal of non-current assets
(6,813) 8,051
(including the offset part of asset impairment provisions)
Government grants recognized through profit or loss
(excluding government grants closely related to business of
11,138 31,768
the Company and given at a fixed quota or amount in
accordance with government’s uniform standards)
Recovery or reversal of provision for bad debts which is
assessed individually during the years 14,604 27,077
Other non-operating income and expenses other than the
above (1,852) 4,897
Less: Income tax effects 3,917 13,720
Total 13,160 58,073
Explanation of other profit or loss that meets the definition of non-recurring profit or loss
□ Applicable √ Not applicable
No such cases in the Reporting Period.
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ADAMA Ltd. Third Quarter Report 2021
Explanation of why the Company classified an item as non-recurring profit/loss according to the definition in the First
Explanatory Announcement on Information Disclosure for Companies Offering their Securities to the Public.
Non-recurring Profit and Loss, and reclassified any non-recurring profit/loss items are given as examples in the said
explanatory announcement to recurrent profit/loss
□ Applicable √ Not applicable
No such cases in the Reporting Period.
3. Changes in main accounting statement items and financial indicators in the Reporting Period, as well as reasons for the
changes
√ Applicable □ Not applicable
During the third quarter of 2021, crop prices of most of the major commodity crops remained elevated, supporting strong
crop protection demand in most regions. Demand was further aided by positive weather conditions in various regions,
including Australia, Europe and most of China. Dry conditions in the US, Brazil and Canada restrained production of some
crops and posed challenges for farmers in those regions.
Farmer incomes are generally expected to continue to improve as a result of high crop prices. However, farmers are
experiencing broad inflationary pressures across most of their inputs, including seeds, fertilizers, crop protection, fuel and
machinery.
During the quarter, availability of intermediates and active ingredients sourced from China was further constrained,
contributing further to the already high procurement prices amid strong global demand. Beginning in mid-September,
production of active ingredients and intermediates in China was more disrupted as a result of production suspensions due
to power rationing for industrial customers due to a power shortage in the country, as well as the "Dual Control" policy
measures to ensure the country’s energy reduction targets are met. Energy prices have been increasing outside of China
as well, with prices of natural gas, coal and oil all rising considerably.
Global freight and logistics costs remained significantly elevated during the third quarter of 2021, as COVID-19 continues
to disrupt port activity, resulting in container shortages, while demand for container shipping remains high. Similarly,
in-land logistics remain challenged as pandemic-related restrictions continue to create frictions in domestic supply lines.
Taken together, these constraints have impacted both availability of shipping and transportation resources, as well as
significantly increased their costs, a dynamic widely observed across all international trade-related industries.
The Company continues to actively manage its procurement and supply chain activities in order to mitigate these higher
procurement and logistics costs. It also endeavors to adjust its pricing wherever market conditions allow, to compensate
for these increased costs. Although intense competition in certain key markets continues to restrain the Company's ability
to do so in an effective and timely manner, the Company is starting to see positive price movements in certain regions,
most notably in China, as well as in North America and Latin America.
China Operations Update
The Company's manufacturing site in Jingzhou, Hubei (ADAMA Sanonda) continues on its path of gradually ramping up
production following the completion of the Relocation & Upgrade program at the site. This return to production at Sanonda
will progressively reduce the need for incurring additional procurement costs which the Company had endured while the
plant was previously suspended, and is expected to gradually reduce idleness charges as production and utilization levels
steadily rise over the coming months.
As a result of the recent institution of China's "Dual Control" energy restrictions, the Company's manufacturing facilities in
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ADAMA Ltd. Third Quarter Report 2021
Huai'An (ADAMA Anpon) and in Dafeng (ADAMA Huifeng), both in Jiangsu province, were suspended for a number of
weeks in September and October 2021 in advance of the Chinese Golden Week festival. As the restrictions have started
to be loosened in recent weeks, operations at these sites have since resumed, albeit at a more limited capacity. This
temporary suspension caused an increase in idleness costs during the quarter, and is expected to contribute to further
idleness charges in the coming quarters, until the power restrictions are lifted and production is able to resume fully.
The energy restrictions and resulting widespread production suspensions have contributed to a significant increase in
procurement costs of raw materials and intermediates, on top of the already high costs seen in recent months in the face
of strong underlying demand and relatively constrained supply. These costs are expected to remain elevated, and will
continue to impact the Company's profitability in the coming months. The Company endeavors, wherever possible and
supported by market conditions, to increase prices in order to mitigate the impact of the higher costs. In China, although
industry-wide supply shortages are causing increased procurement costs and posing challenges for the Company's
margins, the Company is also benefiting to some extent from the generally higher pricing environment in the sales of its
raw materials and intermediates, where it is seeing strong demand.
Same
January - Same period January -
period
September last year September
+/-% last year +/-%
2021 (000’RMB) 2021
(000’USD)
(000’RMB) (000’USD)
Operating income
22,488,364 20,889,623 7.65% 3,475,992 2,986,609 16.39%
(Revenues)
Cost of goods sold 16,143,819 14,757,406 9.39% 2,495,316 2,110,039 18.26%
Sales & Marketing
3,725,486 3,681,011 1.21% 575,816 526,484 9.37%
expenses
General &
Administrative 1,020,945 768,156 32.91% 157,812 109,877 43.63%
expenses
R&D expenses 340,888 280,212 21.65% 52,692 40,069 31.50%
Financial Expenses 1,107,975 1,191,155 -6.98% 171,273 170,242 0.61%
Gain (loss) from
Changes in Fair (328,167) 228,849 -243.40% (50,878) 32,905 -254.62%
Value
Investment Income
506,381 171,333 195.55% 78,409 24,295 222.74%
(loss)
Total Net Financial
Expenses and 929,761 790,973 17.55% 143,742 113,042 27.16%
Investment Income
Total profits 244,550 465,547 -47.47% 37,797 66,070 -42.79%
Income tax expenses 246,269 240,489 2.40% 38,054 34,277 11.02%
Net profit attributable
to shareholders of the (3,916) 225,058 -101.74% -595 31,793 -.8.101%
Company
EBITDA 2,619,409 3,068,857 -14.65% 404,900 438,459 -7.65%
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ADAMA Ltd. Third Quarter Report 2021
Q3 2021 Q3 2020
Q3 2021 Q3 2020 (000’RMB)
+/-% (000’USD) (000’USD) +/-%
(000’RMB)
Operating
income 7,424,584 6,768,583 9.69% 1,147,469 978,205 17.30%
(Revenues)
Cost of goods
5,437,109 4,852,936 12.04% 840,308 701,346 19.81%
sold
Sales &
Marketing 1,219,050 1,212,443 0.54% 188,399 175,224 7.52%
expenses
General &
Administrative 449,138 214,970 108.93% 69,421 31,067 123.46%
expenses
R&D expenses 113,948 92,027 23.82% 17,612 13,300 32.42%
Financial
659,185 348,363 89.22% 101,884 50,348 102.36%
Expenses
Gain (loss)
from Changes 336,415 (36,661) -1017.64% 51,993 -5,298 -1081.37%
in Fair Value
Investment
(21,375) 119,204 -117.93% (3,304) 17,227 -119.18%
Income (loss)
Total Net
Financial
Expenses and 344,145 265,820 29.47% 53,195 38,419 38.46%
Investment
income
Total profits (175,764) 16,700 -1152.48% -27,178 2,418 -1223.99%
Income tax
195,188 (3,709) -5362.55% 30,164 -534 -5748.69%
expenses
Net profit
attributable to
shareholders (370,952) 20,409 -1917.59% -57,342 2,952 -2042.48%
of the
Company
EBITDA 666,988 949,586 -29.76% 103,080 137,242 -24.89%
Note: Since the functional currency of main overseas subsidiaries is the USD, and the Company’s management review of
the Company’s performance is based on the USD results, following explanations and analysis are based on
USD-denominated numbers as listed above.
Analysis of Financial Highlights
(1) Revenues
Revenues in the third quarter grew by 17% (+10% in RMB terms) to $1,147 million, driven by a combination of
continued robust 14% volume growth, including the contribution of newly acquired companies, as well as
moderately higher prices and favorable exchange rate movements.
In the quarter, the Company delivered significant growth in Europe, with strong demand driven by high crop prices
being aided by supportive weather conditions in certain areas. The Company continues to grow strongly in China,
where sales of its branded, formulated portfolio were supported by new product launches and further bolstered by
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ADAMA Ltd. Third Quarter Report 2021
the contribution of newly acquired companies. The Company also benefited from strong demand and higher prices
for the sales of its raw materials and intermediates in the country. The Company delivered a strong performance in
North America, driven by a combination of significant volume growth and higher prices, as well as in Latin America,
led by Brazil, which saw robust demand and higher prices.
The accelerated growth in the quarter brought nine-month sales to a record-high of $3,476 million, an increase of
16% (+8% in RMB terms).
Regional Sales Performance
Q3 2021 Q3 2020 Change 9M 2021 9M 2020 Change
$m $m USD $m $m USD
Europe 220 181 21.8% 825 790 4.5%
North America 183 145 26.3% 628 518 21.4%
Latin America 372 335 11.1% 820 714 14.8%
Asia Pacific 194 148 31.6% 677 497 36.3%
Of which China 121 82 46.6% 380 250 52.0%
India, Middle East & Africa 178 170 4.6% 525 468 12.2%
Total 1,147 978 17.3% 3,476 2,987 16.4%
Europe: Sales were up by 20.3% in the third quarter and by 2.9% in the first nine months of the year, in constant
exchange rates (CER), compared with the corresponding periods last year.
In the third quarter, the Company saw significant growth across most of Europe, with strong demand driven by continued
high crop prices. Noteworthy performances were delivered in most markets of Central, Eastern and Northern Europe,
where supportive weather later in the quarter ensured a positive start to the autumn season, especially in oilseed rape,
winter cereals and sunflower.
In US dollar terms, sales were higher by 21.8% in the quarter and by 4.5% in the first nine months, compared to the
corresponding periods last year, reflecting the net impact of the strengthening of regional currencies.
North America: Sales were up by 26.0% in the third quarter and by 20.6% in the first nine months of the year, in CER
terms, compared with the corresponding periods last year.
The especially strong performance in the third quarter was driven by a combination of significant volume growth and
higher prices, as the Company sees robust demand in both the Agriculture as well as Consumer & Professional arms.
This pleasing result was achieved despite supply concerns in certain products. In Canada, the Company delivered a
pleasing performance, as higher insecticide applications compensated for reduced fungicide usage as a result of
drought in the prairies.
In US dollar terms, sales were higher by 26.3% in the quarter and by 21.4% in the first nine months, compared to the
corresponding periods last year, reflecting the strengthening of the Canadian Dollar.
Latin America: Sales grew by 9.2% in the third quarter and by 15.8% in the first nine months of the year, in CER terms,
compared to the corresponding periods last year.
The pleasing performance in the quarter was led by strong growth in Brazil, driven by robust demand and higher prices,
and benefiting from strong performance of newly launched products, as the country starts to reopen after the recent
improvement in the COVID situation in the country allowing resumption of normal commercial activities.
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ADAMA Ltd. Third Quarter Report 2021
In US dollar terms, sales in the region grew by 11.1% in the quarter, reflecting a strengthening in regional currencies
during the quarter compared to the parallel quarter in 2020. In the nine-month period, sales in the region grew by 14.8%
in US dollar terms, compared to the corresponding period last year, reflecting the somewhat weaker average currency
levels that prevailed during the first quarter of 2021 compared to the parallel quarter in 2020, which saw currency
weakness against the USD only late in the quarter at the outbreak of COVID-19.
Asia Pacific: Sales grew by 26.7% in the quarter and by 26.0% in the first nine months of the year, in CER terms,
compared to the corresponding periods last year.
The Company is growing strongly in Asia Pacific, led by China where the Company continues to grow sales of its
branded, formulated portfolio, supported by new product launches and bolstered by the acquisition of Huifeng’s
domestic commercial arm at the end of 2020. In China, although industry-wide supply shortages are causing increased
procurement costs and posing challenges for the Company's margins, the Company is also benefiting to some extent
from the generally higher pricing environment in the sales of its raw materials and intermediates where it is seeing
strong demand.
In the rest of APAC, the Company delivered a noteworthy performance in the Pacific region, enjoying positive seasonal
conditions and healthy demand as farmers benefit from the high crop prices. This more than offset somewhat softer
performance in South East Asian countries, where ongoing COVID restrictions continued to impact commercial activities,
and were further exacerbated by poor seasonal conditions in many countries, including floods in parts of Thailand.
In US dollar terms, sales in the region grew by 31.6% in the third quarter and by 36.3% in the first nine months of the
year, compared to the corresponding periods last year, reflecting the impact of the strengthening of regional currencies,
most notably the Australian Dollar and Chinese Renminbi.
India, Middle East and Africa: Sales grew by 2.9% in the quarter and by 10.9% in the first nine months of the year, in
CER terms, compared to the corresponding periods last year.
The moderate growth in the region in the quarter was led by a noteworthy performance in South Africa, where the
Company is benefiting from favorable cropping conditions and new product launches. However, growth in India is
slowing as farmers missed some applications due to volatile weather conditions following a previously strong start to the
monsoon season.
In US dollar terms, sales in the region grew by 4.6% in the quarter and by 12.2% in the first nine months of the year,
compared to the corresponding periods last year, reflecting the impact of the strengthening of regional currencies
compared to the USD, most notably the Israeli Shekel.
(2) Cost of Goods
Cost of Goods Sold in the third quarter was $840 million (RMB 5,437 million) (73.2 % of sales), compared to $701
million (RMB 4,853 million) (71.7 % of sales) reported in the corresponding quarter last year. In the first nine months,
Cost of Goods sold was $2,495 million (RMB 16,144 million) (71.8 % of sales), compared to $2,110 million (RMB
14,757 million) (70.6 % of sales) reported in the corresponding period last year.
The Company recorded certain extraordinary charges within its reported cost of goods sold, totaling approximately
$11 million (RMB 71 million) in the third quarter (Q3 2020: $ 10 million (RMB 68 million)) and $36 million (RMB 235
million) in the first nine months (9M 2020: $28 million (RMB 193 million)). These charges were largely related to its
continuing Relocation & Upgrade program, and include mainly excess procurement costs, both in quantity and cost
terms, incurred as the Company continued to fulfill demand for its products in order to protect its market position
through replacement sourcing at significantly higher costs from third-party suppliers.
Excluding the impact of the abovementioned extraordinary charges, the higher Cost of Goods sold, both in the
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ADAMA Ltd. Third Quarter Report 2021
quarter and in the first nine months, were driven by the impacts of higher logistics, procurement and production
costs as well as the effect of the strong RMB and ILS, the Company's main production currencies. The recent
temporary plant suspensions in China resulting from the country's Dual Control policy have further challenged
supply of raw materials, intermediates and active ingredients, serving to further exacerbate the impact of already
high procurement costs.
(3) Operating Expenses:
Operating expenses include Sales and Marketing, General and Administration and R&D.
Operating expenses in the third quarter were $275 million (RMB 1,782 million) (24% of sales) and $786 million
(RMB 5,087 million) (23% of sales) in the nine-month period, compared to $220 million (RMB 1,519 million) (22%
of sales) and $676 million (RMB 4,729 million) (23% of sales) in the nine-month period reported in the
corresponding periods last year.
The Company recorded certain non-operational, mostly non-cash, charges within its reported operating expenses,
mainly as follows:
(i) $4 million (RMB 28 million) in Q3 2021 (Q3 2020: $8 million (RMB 53 million)) and $19 million (RMB 122
million) in 9M 2021 (9M 2020: $23 million (RMB 160 million)) in non-cash amortization charges in respect of
Transfer assets received and written-up related to the 2017 ChemChina-Syngenta acquisition. The
proceeds from the Divestment of crop protection products in connection with the approval by the EU
Commission of the acquisition of Syngenta by ChemChina, net of taxes and transaction expenses, were
paid to Syngenta in return for the transfer of a portfolio of products in Europe of similar nature and economic
value. Since the products acquired from Syngenta are of the same nature, and with the same net economic
value as those divested, the Divestment and Transfer transactions had no net impact on the underlying
economic performance of the Company. These additional amortization charges will continue until 2032 but
at a reducing rate, yet will still be at a meaningful level until 2028;
(ii) $4 million (RMB 25 million) in Q3 2021 (Q3 2020: $3 million (RMB 19 million)) and $11 million (RMB 73
million) in 9M 2021 (9M 2020: $8 million (RMB 55 million)) in charges related mainly to the non-cash
amortization of intangible assets created as part of the Purchase Price Allocation (PPA) on acquisitions,
with no impact on the ongoing performance of the companies acquired, as well as other M&A-related costs.
(iii) $16 million (RMB 101 million) in Q3 2021 (Q3 2020: $1 million (RMB 9 million)) and $31 million (RMB 198
million) in 9M 2021 (9M 2020: $14 million (RMB 97 million)) in idleness charges largely related to
suspensions at the facilities being relocated as well as to the temporary suspension of the Jingzhou site in
Q1 2020 at the outbreak of COVID-19 in Hubei Province.
The higher aggregate amount of non-operational charges in Q3 and 9M 2020 then also included $11 million (RMB
79 million) and $34 million (RMB 240 million), respectively, in non-cash amortization charges related to the legacy
PPA of the 2011 acquisition of Adama Agricultural Solutions, which have now largely finished, and $1 million (RMB
4 million) and $10 million (RMB 70 million), respectively, in early retirement expenses. For further details on these
non-operational charges, please see the appendix to this report.
Excluding the impact of the abovementioned non-operational charges, the higher operating expenses in the
quarter and the nine-month period largely reflect the strong volume-driven growth of the business and the
additional operating expenses of the newly acquired companies, together with significantly higher global logistics
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ADAMA Ltd. Third Quarter Report 2021
and shipping costs, as well as the impact of generally stronger global currencies against the US dollar. In addition,
alongside the many benefits the Company enjoys from the collaboration with other companies in the Syngenta
Group, most notably in commercial cross-sales as well as in the areas of procurement and operations, ADAMA
recorded certain related expenses and charges.
(4) Financial Expenses
“Financial Expenses” alone mainly reflect interest payments on corporate bonds and bank loans as well as foreign
exchange gains/losses on the bonds and other monetary assets and liabilities before the Company carries out any
hedging. The impact of Financial Expenses (before hedging) is RMB 659 million and RMB 1,108 million ($102
million and $171 million) for the three and first nine months of 2021, respectively, compared with RMB 348 million
and RMB 1,191 million ($50 million and $170 million) for the corresponding periods in 2020.
Given the global nature of its operational activities and the composition of its assets and liabilities, the Company, in
the ordinary course of its business, uses foreign currency derivatives (forwards and options) to hedge the cash flow
risks associated with existing monetary assets and liabilities that may be affected by exchange rate fluctuations.
Net gains/losses from hedging of those positions, are recorded in “Gains/Losses from Changes in Fair Value”, and
are then transferred to “Investment Income” upon realization. The combined impact of the hedging transactions on
Gains/Losses from Changes in Fair Value and Investment Income is a net gain of RMB 314 million and RMB 174
million ($49 million and $27 million) in the three and first nine months of 2021, respectively, compared with RMB 22
million and RMB 326 million ($3 million and $46 million) in the corresponding period in 2020.
The aggregate of Financial Expenses, Gains/Losses from Changes in Fair Value and Investment Income
(hereinafter as “Total Net Financial Expenses and Investment Income”), which more comprehensively reflects the
financial expenses of the Company in supporting its main business and protecting its monetary assets/liabilities,
amounts to RMB 344 million and RMB 930 million ($53 million and $144 million) in the three and first nine months
of 2021, respectively, compared with RMB 266 million and RMB 791 million ($38 million and $113 million) in the
corresponding period in 2020.
The higher financial expenses in the quarter and the nine-month period were mainly driven by the net effect of the
increase in the Israeli CPI on the ILS-denominated, CPI-linked bonds, as well as higher non-cash charges related
to put options in respect of minority interests. These increases were partially offset by benefits on hedges in
respect of the RMB.
In addition, Investment Income also mainly includes an amount of RMB 4 million ($1 million) in respect of equity
accounted investees in the first nine months of 2021 compared with RMB 15 million ($2 million) and RMB 59
million ($9 million) capital gain from gaining control over an equity investee in the corresponding period in 2020,
bringing the total Gains/Losses from Changes in Fair Value and Investment Income to RMB 178 million ($28 million)
in the first nine months of 2021 compared with RMB 400 million ($57 million) in the corresponding period in 2020.
(5) Income Tax Expenses
The significantly higher tax expenses in the third quarter, and the resulting increase over the nine-month period,
reflects the incurring of higher taxes by the Company's high-growth selling entities in end-markets, as well as the
largely non-cash impact on the value of non-monetary tax assets of the more significant weakening of the BRL in
the third quarter of 2021 when compared to the same quarter in 2020. By contrast, over the nine-month period, the
deterioration of the BRL in 2020 was more significant than in 2021, resulting in a relatively lower impact over the
nine-month period in 2021.
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ADAMA Ltd. Third Quarter Report 2021
Changes in main assets and liabilities
Unit: RMB’000
Assets and liabilities September 30, December % change Explanation for any major change
2021 31, 2020
Cash at bank and on
4,956,080 3,863,886 28.27% Additional long-term loans and better collection
hand
Accounts receivable 9,005,729 8,766,869 2.72% No Significant change
Higher inventory levels due mainly to a shift in
geographic and portfolio sales mix, the
anticipation of further volume growth in coming
Inventories 11,345,025 10,338,273 9.74% quarters in the face of uncertain supply
conditions, the increase in procurement and
production costs, as well as the inclusion of
recent acquisitions
Increase is mainly due to transfer of China
Fixed assets 8,084,760 6,576,116 22.94%
relocation projects from CIP
Changes are mainly due to investments as part
Construction in progress 1,670,689 1,405,328 18.88%
of upgrade and relocation projects
Decrease is mainly due to collection of
58,745 95,329 -38.38%
Long term receivables long-term receivables
Short-term loans 1,146,246 1,205,498 -4.92% Additional long-term loans and better collection
Long-term loans 3,608,563 2,387,628 51.14% No Significant change
Derivative financial
282,478 1,560,788 -81.90% Realization and revaluation of derivatives
assets
Derivative financial
240,459 1,463,614 -83.57% Realization and revaluation of derivatives
liabilities
Mainly increase in liabilities in respect of
Other payables 1,672,441 1,075,721 55.47% securitization transaction and acquisition of
subsidiaries
Contractual liabilities 1,349,014 1,092,253 23.51% Seasonality increase mainly due to rebates
Non-current liabilities Increase due to long-term loan expected
1,746,360 1,272,581 37.23%
due within one year repayment in the coming twelve months
Increase due to new plan in one of the group
98,435 27,327 260.21%
Long term payable subsidiaries
Other non-current Increase due to a put option in respect of
1,367,666 434,030 215.11%
liabilities minority interests.
Due to the B-Shares repurchase and
Treasury shares - 60,357 100.00%
cancellation
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ADAMA Ltd. Third Quarter Report 2021
II. Information regarding the Shareholders
1. Total number of ordinary shareholders and preference shareholders who had resumed their voting
rights, and shareholdings of top 10 shareholders at the period-end
Unit: share
43,849
Total number of preference
(the number of ordinary A
Total number of ordinary shareholders at shareholders who had resumed
share shareholders is 29,959; 0
the end of the Reporting Period their voting right at the end of
the number of B share
the Reporting Period (if any)
shareholders is 13,890)
Shareholdings of top 10 shareholders
Number of Pledged or frozen shares
Nature of Shareholding Number of
Name of shareholder restricted shares
shareholder percentage shares held Status Number
held
Syngenta Group Co., Ltd. State-owned
78.47% 1,828,137,961 -- -- --
legal person
China Cinda Asset State-owned
1.34% 31,115,916 -- -- --
Management Co., Ltd. legal person
Portfolio No.503 of National
Others 0.77% 18,000,000 -- -- --
Social Security Fund
Huarong Ruitong Equity
State-owned
Investment Management Co., 0.55% 12,885,906 -- -- --
legal person
Ltd.
Hong Kong Securities Overseas
0.36% 8,275,503 -- -- --
Clearing Company Limited legal person
Bosera Funds-China
Merchants Bank- Bosera
Funds Xincheng No.2 Others 0.28% 6,500,000 -- -- --
Collective Asset
Management Plan
Bosera Funds-Postal
Savings Bank- Bosera Funds
Others 0.26% 6,000,000 -- -- --
Xincheng No.3 Collective
Asset Management Plan
China Universal
Fund-Industrial Bank-China
Universal-Strategic
Others 0.19% 4,400,000 -- -- --
Enhancement No.3
Collective Asset
Management Plan
State-owned Assets
State-owned
Administration Bureau of 0.18% 4,169,266 -- -- --
legal person
Qichun County
Zhu Shenglan Domestic
natural 0.18% 4,100,000 -- -- --
person
Shareholdings of top 10 non-restricted shareholders
Number of non-restricted Type of shares
Name of shareholder
shares held at the period-end Type Number
Syngenta Group Co., Ltd. 1,828,137,961 RMB ordinary share 1,828,137,961
China Cinda Asset Management Co., Ltd. 31,115,916 RMB ordinary share 31,115,916
Portfolio No.503 of National Social
18,000,000 RMB ordinary share 18,000,000
Security Fund
Huarong Ruitong Equity Investment
12,885,906 RMB ordinary share 12,885,906
Management Co., Ltd.
Hong Kong Securities Clearing Company
8,275,503 RMB ordinary share 8,275,503
Limited
Bosera Funds-China Merchants Bank-
Bosera Funds Xincheng No.2 Collective 6,500,000 RMB ordinary share 6,500,000
Asset Management Plan
Bosera Funds-Postal Savings Bank- 6,000,000 RMB ordinary share 6,000,000
12
ADAMA Ltd. Third Quarter Report 2021
Bosera Funds Xincheng No.3 Collective
Asset Management Plan
China Universal Fund-Industrial
Bank-China Universal-Strategic
4,400,000 RMB ordinary share 4,400,000
Enhancement No.3 Collective Asset
Management Plan
State-owned Assets Administration
4,169,266 RMB ordinary share 4,169,266
Bureau of Qichun County
Zhu Shenglan 4,100,000 RMB ordinary share 4,100,000
Syngenta Group Co., Ltd. is not related party or acting-in-concert party as
prescribed in the Administrative Methods for Acquisition of Listed Companies
Related or act-in-concert parties among
to other shareholders. It is unknown to the Company whether shareholders
the shareholders above
above are related parties or acting-in-concert parties as prescribed in the
Administrative Methods for Acquisition of Listed Companies.
Top 10 ordinary shareholders conducting Shareholder Zhu Shenglan held 4,100,000 shares of the Company through a
securities margin trading (if any) credit collateral securities trading account.
2. Total number of preference shareholders and shareholdings of the top 10 of such at the period-end
□ Applicable √ Not applicable
III. Other Significant Events
√Applicable □Not applicable
1. On August 30, 2021, the Company received the Notice of Sinochem Holdings Corporation Ltd. (“Sinochem Holdings”)
on the Initiation of Joint Restructuring Procedure released by Sinochem Holdings stating, that the latter decided to
initiate, starting from the date of the notice, the acquisition procedure for the listed companies associated with
Sinochem Group and ChemChina in accordance with the relevant provisions. On September 16, 2021, the Company
received a letter from Sinochem Holdings, stating that the industrial and commercial change registration on the
transfer of equity in ChemChina to Sinochem Holdings has been completed. After the completion of such transfer, the
controlling shareholder and the actual controller of the Company remained unchanged.
2. On September 28, 2021, the Company received the Shares Registration Confirmation Letter issued by China
Securities Depository and Clearing Corporation Limited forwarded by its controlling shareholder Syngenta Group,
approving that the registration procedures for the transfer of the 5.14% of the Company’s total share capital held by
Sanonda Holdings Co., Ltd. were completed, and the corresponding shares were transferred to Syngenta Group. After
the completion of such transfer, Syngenta Group holds 1,828,137,961 shares (accounting for 78.47% of the
Company’s total share capital). The controlling shareholder and the actual controller of the Company remained
unchanged.
The following are the relevant announcements disclosed on the website www.cninfo.com.cn.:
13
ADAMA Ltd. Third Quarter Report 2021
Announcements Disclosure date
Announcement on Equity Transfer of China National Chemical Corporation Ltd. at Nil Consideration
Aug 31, 2021
(Announcement No. 2021-38)
Abstract of Acquisition Report of ADAMA Ltd. Aug 31, 2021
Acquisition Report of ADAMA Ltd. Sep 4, 2021
Legal Opinions of Tian Yuan Law Firm on Acquisition Report of ADAMA Ltd. Sep 4, 2021
Legal Opinions of Tian Yuan Law Firm on Exemption of Sinochem Holdings Corporation Ltd. from Sep 4, 2021
Making a Tender Offer for the Acquisition of ADAMA Ltd.
Announcement on Completion of Industrial and Commercial Registration of Changes on Equity Sep 17, 2021
Transfer of China National Chemical Corporation Ltd. at Nil Consideration (Announcement No.
2021-39)
Announcement on the Completion of the Registration of the Transfer of State-owned Shares held by Sep 29, 2021
the Controlling Shareholder (Announcement No. 2021-40)
IV. Financial Statements
i. Financial Statements
1. Consolidated balance sheet
Prepared by ADAMA Ltd.
30 September 2021
Unit: RMB’000
September 30, December 31, September 30, December 31,
Item Item
2021 2020 2021 2020
Current assets: Current liabilities:
Cash at bank and on hand 4,956,080 3,863,886 Short-term loans 1,146,246 1,205,498
Financial assets held for
Derivative financial liabilities
trading 1,446 1,253 240,459 1,463,614
Derivative financial assets 282,478 1,560,788 Bills payable 247,466 369,791
Bills receivable 111,821 102,082 Accounts payable 5,083,736 4,557,006
Accounts receivable 9,005,729 8,766,869 Contract liabilities 1,349,014 1,092,253
Receivables financing 67,021 109,483 Employee benefits payable 1,143,946 1,208,834
Prepayments 407,672 406,008 Taxes payable 450,303 358,988
Other receivables 1,060,436 1,310,029 Other payables 1,672,441 1,075,721
Non-current liabilities due
Inventories
11,345,025 10,338,273 within one year 1,746,360 1,272,581
Other current assets 857,157 769,641 Other current liabilities 390,713 315,597
Total current assets 28,094,865 27,228,312 Total current liabilities 13,470,684 12,919,883
Non-current assets: Non-current liabilities:
Long-term receivables 58,745 95,329 Long-term loans 3,608,563 2,387,628
Long-term equity investments 16,019 14,081 Debentures payable 8,167,298 8,078,113
Other equity investments 151,795 152,200 Lease liabilities 368,110 379,190
Investment properties 3,088 4,364 Long-term accounts payable 98,435 27,327
Long-term employee benefits
Fixed assets
8,084,760 6,576,116 payables 751,494 645,755
Construction in progress 1,670,689 1,405,328 Provisions 192,076 163,251
Right-of-use assets 472,092 483,618 Deferred tax liabilities 334,918 331,942
Intangible assets 5,102,403 5,226,455 Other non-current liabilities 1,367,666 434,030
Goodwill 4,610,484 4,584,226 Total non-current liabilities 14,888,560 12,447,236
Deferred tax assets 838,513 773,673 Total liabilities 28,359,244 25,367,119
Other non-current assets 410,154 257,332 Shareholders’ equity:
Total non-current assets 21,418,742 19,572,722 Share capital 2,329,812 2,344,121
Total assets 49,513,607 46,801,034 Capital reserves 12,882,324 13,023,219
Less: Treasury shares - 60,357
Other comprehensive income (102,905) (72,055)
Special reserves 19,368 15,960
Surplus reserves 240,162 240,162
Retained earnings 5,785,602 5,862,702
Total equity attributed to the
shareholders of the company 21,154,363 21,353,752
Non-controlling interests - 80,163
Total equity 21,154,363 21,433,915
Total liabilities and equity 49,513,607 46,801,034
14
ADAMA Ltd. Third Quarter Report 2021
Ignacio Dominguez
Legal representative
Chief of the accounting work and Chief of the accounting organ
15
ADAMA Ltd. Third Quarter Report 2021
2. Consolidated income statement for the period from the year-beginning to the end of the Reporting Period
Unit: RMB’000
Item January-September, 2021 January-September, 2020
1. Total operating Income 22,488,364 20,889,623
Less: Cost of sales 16,143,819 14,757,406
Taxes and surcharges 82,359 67,447
Selling and Distribution expenses 3,725,486 3,681,011
General and Administrative expenses 1,020,945 768,156
Research and Development expenses 340,888 280,212
Financial expenses: 1,107,975 1,191,155
Including: Interest expense 462,725 522,253
Interest income 45,487 46,871
Add: Investment income (loss), net 506,381 171,333
Including: Income from investment in 4,408 14,691
associates and joint ventures
Gain (loss) from changes in fair value (328,167) 228,849
Credit impairment reversal (losses) 9,685 (8,871)
Asset Impairment losses (39,358) (107,528)
Gain from disposal of assets 9,246 7,521
2. Operating profit 224,679 435,540
Add: Non-operating income 46,564 48,328
Less: Non-operating expense 26,693 18,321
3. Total profit 244,550 465,547
Less: income tax expense 246,269 240,489
4. Net profit (1,719) 225,058
5.1 Classified by nature of operations
5.1.1 Continuing operations (1,719) 225,058
5.1.2 Discontinued operations - -
5.2 Classified by ownership
5.2.1 Shareholders of the Company (3,916) 225,058
5.2.2 Non-controlling interests 2,197 -
5. Other comprehensive income, net of tax (30,850) (569,158)
Other comprehensive income, net of tax attributable to shareholders (30,850) (569,158)
of the Company
5.1 Items that will not be reclassified into profit/loss (5,474) 19,890
5.1.1 Re-measurement of defined benefit plan liability (5,474) 19,890
5.1.2 FV changes in other equity investment - -
5.2 Items that were or will be reclassified to profit or loss (25,376) (589,048)
5.2.1 Effective portion of gains or loss of cash flow hedge 237,449 (105,575)
5.2.2 Translation differences of foreign financial statements (262,825) (483,473)
Other comprehensive income, net of tax attributable to - -
non-controlling interests
6. Total comprehensive income for the period (32,569) (344,100)
6.1 Total comprehensive income for the period attributable to (34,766) (344,100)
shareholders of the Company
6.2 Total comprehensive income for the period attributable to 2,197 -
non-controlling interests
7. Earnings per share
7.1 Basic earnings per share (RMB/ share) (0.0017) 0.0929
7.2 Diluted earnings per share (RMB/ share) N/A N/A
Ignacio Dominguez
Legal representative
Chief of the accounting work and Chief of the accounting organ
16
ADAMA Ltd. Third Quarter Report 2021
3. Consolidated cash flow statement for the period from the year-beginning to the end of the Reporting
Period
Unit: RMB’000
Item January-September, 2021 January-September, 2020
1. Cash flows from operating activities:
Cash received from sale of goods and rendering of services 21,454,588 19,666,330
Refund of taxes and surcharges 133,814 156,475
Cash received relating to other operating activities 563,811 653,446
Sub-total of cash inflows from operating activities 22,152,213 20,476,251
Cash paid for goods and services 14,368,965 13,839,037
Cash paid to and on behalf of employees 2,789,320 2,751,086
Payments of taxes and surcharges 344,129 289,260
Cash paid relating to other operating activities 2,467,812 2,204,868
Sub-total of cash outflows from operating activities 19,970,226 19,084,251
Net cash flows from operating activities 2,181,987 1,392,000
2. Cash flows from investing activities:
Cash received from disposal of investments 3,864 27,994
Cash received from returns of investments 867 54,304
Net cash received from disposal of fixed assets, intangible assets and other 19,964 17,615
long-term assets
Cash received from other investing activities 8,562 2,673
Sub-total of cash inflows from investing activities 33,257 102,586
Cash paid to acquire fixed assets, intangible assets and other 1,803,236 1,301,309
long-term assets
Net cash paid to acquire subsidiaries or other 655,039 96,207
business units
Cash paid for acquisition of investments - 51,435
Cash paid for other investing activities 86,228 47,739
Sub-total of cash outflows from investing activities 2,544,503 1,496,690
Net cash flows from investing activities (2,511,246) (1,394,104)
3. Cash flows from financing activities:
Cash received from borrowings 4,369,565 3,852,354
Cash received relating to other financing activities 522,649 74,843
Sub-total of cash inflows from financing activities 4,892,214 3,927,197
Cash repayment of borrowings 2,655,257 1,671,913
Cash payment for dividends, profit distributions or interest 490,113 411,063
Including: dividends paid to non-controlling interest 35,904 26,176
Cash paid relating to other financing activities 300,907 320,160
Sub-total of cash outflows from financing activities 3,446,277 2,403,136
Net cash flows from financing activities 1,445,937 1,524,061
4. Effect of foreign exchange rate changes on cash and cash (11,381) (147,850)
equivalents
5. Net increase (decrease) in cash and cash equivalents 1,105,297 1,374,107
Add: Cash and cash equivalents at the beginning of the period 3,835,071 4,319,907
6. Cash and cash equivalents at the end of the period 4,940,368 5,694,014
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ADAMA Ltd. Third Quarter Report 2021
ii. Adjustments of the financial statements
1. Opening balance adjustments due to adoption of new accounting standards for leases
□ Applicable √ Not applicable
2. Retrospective adjustments due to adoption of new accounting standards for leases
□ Applicable √ Not applicable
iii. Auditor’s report
Is this Report audited?
□ Yes √ No
This Report is unaudited.
Board of Directors
ADAMA Ltd.
October 28, 2021
18
