HUBEI SANONDA CO., LTD.
THE FIRST QUARTERLY REPORT 2009
§1 Important notes
1.1 The Board of Directors, the Supervisory Committee as well as directors,
supervisors and senior executives of Hubei Sanonda Co., Ltd (hereinafter referred to
as “the Company”) individually and jointly accepted responsibility for the correctness,
accuracy and completeness of the contents of this report and confirmed that there was
no false information, misleading statement or material omissions.
1.2 The Financial Report of the first quarterly report has not been audited.
1.3 Mr. Li Zuorong, Chairman of the Board of the Company, Mr. He Xuesong,
person in charge of accounting firm (chief accountant) and accounting work, hereby
confirmed that the Financial Report enclosed in the quarterly report is true and
complete.
§2 Company Profile
2.1 Main accounting data and financial indices
Unit: RMB Yuan
At the end of
report period
At the end of last
report period
Increase/decrease (%)
Total assets 2,329,370,006.14 2,049,481,852.69 13.66%
Owners’ equity attributable to parent company 1,129,873,617.41 1,098,558,871.77 2.85%
Share capital 593,923,220.00 593,923,220.00 0.00%
Net assets per share attributable to owners of parent companies 1.90 1.85 2.70%
This report period Last report period Increase/decrease (%)
Total operating income 521,912,403.83 540,873,419.02 -3.51%
Net profit attributable to owners of parent companies 31,314,745.64 25,995,111.15 20.46%
Net cash flow from operating activities 5,800,411.66 12,075,129.89 -51.96%
Net cash flow per share from operating activities 0.01 0.02 -50.00%
Basic earnings per share 0.0527 0.0438 20.32%
Diluted earnings per share 0.0527 0.0438 20.32%
Return on equity 2.77% 2.76% 0.01%
Return on equity after deducting non-recurring gain and losses 2.66% 2.76% -0.10%
Items of non-recurring gains and losses
Amount from the
year-begin to period-end
Gains and losses from disposal of non-current assets 2,224,100.00
Other non-operating income/expenses 90,330.00
Impact on income tax -578,607.50Impact on minority interest -481,780.58
Total 1,254,041.92
Explanation on items of non-recurring gains and losses
Gains and losses from disposal of non-current assets was that from disposal of fixed
assets.
2.2 Statement on total number of shares and shares held by the top ten shareholders
holding shares not subject to trading moratorium
Total number of shareholders at the period-end 113,029
Shares held by the top ten shareholders holding shares not subject to trading moratorium
Full name of shareholders
Shares not subject to trading
moratorium held at the period-end
Type of share
Haitong Securities Co., Ltd 9,778,543 RMB ordinary shares
Bank of China-Merchant Pioneer Securities Investment Fund 6,500,000 RMB ordinary shares
Qichun County Administration of State Property 4,489,266 RMB ordinary shares
Agricultural Bank of China-Schroeder silver hybrid selected stock
securities fund
4,300,000 RMB ordinary shares
Agricultural Bank of China- China Post Core Growth Stock Fund 3,522,924 RMB ordinary shares
China Merchants Bank Co., Ltd-CITIC Classical Allocation Fund 3,500,000 RMB ordinary shares
Bank of Communications-Schroeder Blue Chip Stock Securities
Investment Fund
3,450,065 RMB ordinary shares
Heng Seng Bank Limited 2,999,712 RMB ordinary shares
Bank of Communications-CITIC Dividend Selected Stock Fund 2,461,909 RMB ordinary shares
NORGES BANK 1,301,210 Domestically listed foreign shares
§3 Significant Events
3.1 Particular about large-margin changes of main accounting statement item and
financial indices and its reason
√Applicable □Inapplicable
Amount at the year-begin
Items
Amount at
the
period-end
(Amount of the same
period of last year)
Proportion of
increase/decrease
Main reason of change
Monetary capital 67,192 56,283 19.38% Mainly due to increase of borrowings
Notes receivable 2,337 862 171.12% Increase of acceptance settlement
Accounts receivable 14,656 8,268 77.27% Mainly due to increase of bill purchased
Advance accounts 4,308 1,592 170.66% Mainly for prepayment of project
Projects in construction 14,729 3,712 296.78% Increase of project investment
Short-term borrowings
33,100 18,700 77.01%
Increase of capital demand for technical
innovation of production
Long-term borrowings 37,756 29,756 26.89% Increase of project borrowings3.2 The progress and influence of
significant events and the analysis and explanation
on resolving proposal
□Applicable √Inapplicable
3.3 Execution of the commitment made by the Company, shareholders and the actual
controller
√Applicable □Inapplicable
Commitment Content Execution
Commitments of share merger reform
At the Annual Shareholders’ General Meeting 2006,
they proposed the proposal of capital conversion
from capital reserve which will distribute 10 shares
per 10 shares to all shareholders, and voted in favor
This commitment has
been accomplished on 9
Jul. 2007
Commitment of shares subject to trading moratorium
Shares held by Sanonda Group Company will not
listed for trade through Shenzhen Stock Exchange
within 36 months from the first trading date after
execution of share merger reform
In progress of execution
Commitments made in Acquisition Report or Report on
Changes in Equity
Commitments made in reorganization of significant assets
Commitments made when issuance of shares
Other commitments (including additional commitment)
3.4 Warnings of possible loss or large-margin change of the accumulated net profit
made during the period from the beginning of the year to the end of the next report
period compared with the same period of the last year according to prediction, as well
as explanations on the reasons
□Applicable √Inapplicable
3.5 Other significant events need to be explained
3.5.1 Securities investment
□Applicable √Inapplicable
Unit: RMB Yuan
No.
Type of
securities
Stock code Short form of stock
Initial
investment
Shares held
Book value at
year-end
Proportion in total
securities investment at
period-end (%)
Profit and loss
in the reporting
period
1 Stock 000717
Shuanghuan Science
and Technology
495,000.00 495,000.00 4,183,872.00 100.00% 0.00
Other securities investment held at period-end 0.00 - 0.00 0.00% 0.00
Gain and loss from sold securities in the report period - - - - 0.00
Total 495,000.00 - 4,183,872.00 100% 0.00Explanation on securities investment
There was no change during the report period
3.5.2 Statement on reception of investigations, communications and visits
Reception
date
Reception site Reception way Reception object
Topic discussed and information
provided
07 Feb. 2009 Meeting room of the Company Field research
Dongxing securities and
Yimi asset and Jianyin
investment securities
Production and operation status
of the Company
09 Feb. 2009 Meeting room of the Company Field research Shanghai securities
Production and operation status
of the Company
18 Feb. 2009 Meeting room of the Company Field research
Greatwall Fund and Bank
of communications and
New china asset
Production and operation status
of the Company
26 Feb. 2009 Meeting room of the Company Field research
Guangfa Securities and
Jinying Small Cap Fund
Production and operation status
of the Company
3.5.3 Explanation on other significant events
√Applicable □Inapplicable
§4 Attachment
4.1 Balance sheet
Prepared by Hubei Sanonda Co., Ltd 31 Mar. 2009 Unit: RMB Yuan
Balance at the period-end Balance at the year-begin
Items
Consolidation Parent company Consolidation Parent company
Current Assets:
Monetary funds 671,923,916.96 596,552,748.18 562,832,319.76 490,154,426.30
Settlement reserve
Dismantle fund
Transaction financial asset 4,183,872.00 4,183,872.00 4,183,872.00 4,183,872.00
Notes receivable 23,371,295.91 17,148,087.62 8,620,358.99 6,982,848.99
Account receivable 146,564,210.28 17,523,022.23 82,676,725.12 7,589,321.37
Account paid in advance 43,084,607.74 36,927,581.78 15,918,504.32 11,598,028.21
Premiums receivable
Reinsurance premiums receivable
Receivable reinsurance contract reserves
Interest receivable 0.00 0.00
Dividend receivable
Other account receivable 17,225,974.66 138,975,967.71 15,914,988.01 117,681,311.43
Buying back the sale of financial assetsInventories 324,725,565.28 215,974,175.53 346,551,634.75 233,367,834.29
Non-current assets due within 1 year
Other current assets
Total current assets 1,231,079,442.83 1,027,285,455.05 1,036,698,402.95 871,557,642.59
Non-current assets:
Loans and advance
Available for sale financial assets
Held to maturity investments
Long-term account receivable
Long-term equity investment 12,818,382.63 73,932,025.27 12,818,382.63 73,932,025.27
Investing property 5,356,412.50 5,356,412.50 5,356,412.50 5,356,412.50
Fixed assets 757,210,818.81 710,314,144.89 781,010,440.01 730,043,892.69
Construction in progress 147,291,937.56 141,043,026.60 37,121,583.37 31,539,313.21
Engineering material 0.00 0.00 7,580.83
Disposal of fixed assets 0.00 0.00
Production biological assets
Oil-gas assets
Intangible assets 157,971,842.69 115,058,668.48 158,813,608.07 115,835,981.98
Development expense
Goodwill
Long-term deferred expenses 0.00 14,273.21
Deferred tax assets 17,641,169.12 14,049,527.17 17,641,169.12 14,049,527.17
Other non-current assets
Total of non-current assets 1,098,290,563.31 1,059,753,804.91 1,012,783,449.74 970,757,152.82
Total assets 2,329,370,006.14 2,087,039,259.96 2,049,481,852.69 1,842,314,795.41
Current liabilities:：
Short-term borrowings 331,000,000.00 310,000,000.00 187,000,000.00 170,000,000.00
Borrowing from Central Bank
Deposits and sue to banks and other financial
institutions
Call loan received
Transaction financial liabilities
Notes payable 12,890,000.00 0.00 19,040,000.00 15,000,000.00
Account payable 127,900,468.37 78,041,205.08 102,784,556.06 66,963,994.66
Account received in advance 112,554,895.15 26,641,908.60 112,330,681.17 30,364,281.48
Financial assets sold for repurchase
Handling charges and commissions payable
Employee’s compensation payable 17,502,741.63 8,468,555.75 25,448,279.39 14,813,333.63
Tax payable 50,341,725.97 56,066,772.04 51,639,246.20 54,951,662.72
Interest payable 164,025.00
Dividend payable
Other account payable 56,769,270.28 26,468,339.96 43,139,725.39 16,757,176.12
Reinsurance premiums payableInsurance contract reserves
Money received for acting trading of securities
Money paid for acting underwriting of securities
Non-current liabilities due within 1 year 70,000,000.00 70,000,000.00 70,000,000.00 70,000,000.00
Other current liabilities
Total current liabilities 779,123,126.40 575,686,781.43 611,382,488.21 438,850,448.61
Non-current liabilities:
Long-term borrowings 377,560,000.00 377,560,000.00 297,560,000.00 297,560,000.00
Bonds payable
Long-term payables 9,840,000.00 9,840,000.00 9,840,000.00 9,840,000.00
Specific payables 2,761,170.00 0.00 2,761,170.00
Accrued liabilities
Deferred tax liabilities
Other non-current liabilities 11,549,512.89 6,990,000.00 11,549,512.89 6,990,000.00
Total non-current liabilities 401,710,682.89 394,390,000.00 321,710,682.89 314,390,000.00
Total liabilities 1,180,833,809.29 970,076,781.43 933,093,171.10 753,240,448.61
Owner’s equity (or shareholder’ equity)
Paid-up capital (or share capital) 593,923,220.00 593,923,220.00 593,923,220.00 593,923,220.00
Capital reserves 271,719,841.74 268,447,075.77 271,719,841.74 268,447,075.77
Less: Treasury stock 0.00 0.00
Surplus reserves 89,879,859.33 89,879,859.33 89,879,859.33 89,879,859.33
Provisions for general risks
Retained profits 174,350,696.34 164,712,323.43 143,035,950.70 136,824,191.70
Foreign exchange difference
Total owners' equity attributable to parent company 1,129,873,617.41 1,116,962,478.53 1,098,558,871.77
1,089,074,346.80
Minority interest 18,662,579.44 17,829,809.82
Total owner’s equity 1,148,536,196.85 1,116,962,478.53 1,116,388,681.59 1,089,074,346.80
Total liabilities and owner’s equity 2,329,370,006.14 2,087,039,259.96 2,049,481,852.69 1,842,314,795.41
4.2 Income statement
Prepared by Hubei Sanonda Co., Ltd Jan.-Mar. 2009 Unit: RMB Yuan
Amount of this period Amount of last period
Items
Consolidation Parent company Consolidation Parent company
I. Total sales 521,912,403.83 352,237,239.91 540,873,419.02 357,675,936.73
Including: Sales 521,912,403.83 352,237,239.91 540,873,419.02 357,675,936.73
Interest income
Premium income
Handling charges and commission income
II. Total cost of sales 481,083,194.32 314,954,643.90 508,952,217.64 328,646,107.65
Including: Cost of sales 421,242,622.40 273,861,359.11 435,733,801.43 284,435,205.52
Interests expenses
Handling charges and commission expensesCash surrender value
Net amount of claims
Net amount of withdrawn from the insurance contract
reserve
Expenditure on policy dividends
Reinsurance premium
Taxes and associate charges 248,463.05 9,764.56 394,504.84 70,775.46
Sales expenses 18,886,329.21 10,487,184.29 21,939,283.27 10,290,216.47
Administrative expenses 29,701,306.49 20,470,287.28 31,595,022.92 16,992,748.92
Financial expenses 11,004,473.17 10,126,048.66 12,422,058.06 9,989,614.16
Impairment loss 6,867,547.12 6,867,547.12
Add: Gain/(loss) from change in fair value (“-” means loss)
Gain/(loss) from investment (“-” means loss) 3,353,148.38 3,234,000.00
Including: income form investment on affiliated enterprise
and jointly enterprise
Foreign exchange difference (“-” means loss)
III. Business profit (“-” means loss) 40,829,209.51 37,282,596.01 35,274,349.76 32,263,829.08
Add: non-operation income 2,537,604.61 93,469.34 102,321.45 13,587.78
Less: non-business expense 223,174.61 191,889.71 38,209.98 35,963.74
Including: loss from non-current asset disposal
IV. Total profit (“-” means loss) 43,143,639.51 37,184,175.64 35,338,461.23 32,241,453.12
Less: Tax expense 10,996,124.25 9,296,043.91 8,834,615.31 8,060,363.28
V. Net profit (“-” means loss) 32,147,515.26 27,888,131.73 26,503,845.92 24,181,089.84
Attributable to parent company 31,314,745.64 25,995,111.15
Minority interest 832,769.62 508,734.77
VI. Earnings per share
(I) Basic earnings per share 0.0527 0.0438
(II) Diluted earnings per share 0.0527 0.0438
4.3 Cash flow statement
Prepared by Hubei Sanonda Co., Ltd Jan.-Mar. 2009 Unit: RMB Yuan
Amount of this period Amount of last period
Items
Consolidation Parent company Consolidation Parent company
I. Cash flows from operating activities:
Cash received from sale of commodities and rendering of service 376,908,926.51 309,942,640.55
435,467,128.71 330,868,206.49
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 businessNet increase of savings 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 borrowed inter-bank funds
Net increase of buy-back funds
Tax refunds received 1,816,790.64 0.00 11,134,602.08 7,272,494.00
Other cash received relating to operating activities 15,177,553.06 14,900,815.86 23,757,670.23 5,748,494.00
Subtotal of cash inflows from operating activities 393,903,270.21 324,843,456.41 470,359,401.02
343,889,194.49
Cash paid for goods and services 252,554,160.67 193,883,743.72 365,805,843.40 254,565,953.68
Net increase of customer lending and advance
Net increase of funds deposited in the central bank and amount due
from banks
Cash for paying claims of the original insurance contract
Cash for paying interest, handling charges and commissions
Cash for paying policy dividends
Cash paid to and for employees 22,895,737.23 16,333,589.53 23,281,896.76 11,320,531.62
Various taxes paid 26,098,825.20 22,539,994.33 10,911,446.53 1,193,069.81
Payment of cash relating to operating activities 86,554,135.45 85,774,867.08 58,285,084.44 32,106,603.08
Subtotal of cash outflows from operating activities 388,102,858.55 318,532,194.66 458,284,271.13
299,186,158.19
Net cash flows from operating activities 5,800,411.66 6,311,261.75 12,075,129.89 44,703,036.30
II. Cash Flows from investment activities:
Cash received from return of investments 0.00 0.00 5,234,000.00 5,234,000.00
Cash received from investment income 0.00 0.00 0.00 0.00
Net cash received from disposal of fixed assets, intangible assets and
other long-term assets
31,853.00 29,853.00 350,300.00 350,300.00
Net cash received from disposal of subsidiary or other operating
business units
0.00 0.00 0.00 0.00
Other cash received relating to investment activities
Subtotal of cash inflows from investment activities 31,853.00 29,853.00 5,584,300.00 5,584,300.00
Cash paid to acquire fixed assets, intangible assets and other
long-term assets
106,675,124.60 106,575,124.60 112,520,774.16 112,450,774.16
Cash paid to investment 5,100,000.00 5,100,000.00 0.00 0.00
Net increase of pledged loans
Net cash paid by subsidiaries and
Payment of cash relating to other investment activitiesSubtotal of cash outflows from investment activities
111,775,124.60 111,675,124.60 112,520,774.16 112,450,774.16
Net cash flows from investment activities -111,743,271.60 -111,645,271.60 -106,936,474.16 -106,866,474.16
III. Cash Flows from Financing Activities:
Cash received from absorbing investment 0.00 0.00 0.00 0.00
Including: Cash received from increase in minority interest
Cash received from borrowings 326,000,000.00 305,000,000.00 451,593,285.63 323,560,000.00
Cash received from issuance of bonds
Other cash received relating to financing activities 2,119,172.32 1,952,325.66 1,570,132.15 1,343,140.52
Subtotal of cash inflows from financing activities 328,119,172.32 306,952,325.66 453,163,417.78
324,903,140.52
Cash repayments of amounts borrowed 102,000,000.00 85,000,000.00 132,566,650.24 65,000,000.00
Cash paid interest expenses and distribution of dividends or profit 10,658,349.60 10,039,816.00
9,088,242.41 8,522,786.30
Including: dividends or profit paid to minority interest
Other cash payments relating to financing activities 426,365.58 180,177.93 2,852,061.21 2,427,717.67
Sub-total of cash outflows from financing activities 113,084,715.18 95,219,993.93 144,506,953.86
75,950,503.97
Net cash flow from financing activities 215,034,457.14 211,732,331.73 308,656,463.92 248,952,636.55
IV. Effect of foreign exchange rate changes on cash and cash
equivalents
V. Increase in cash and cash equivalents 109,091,597.20 106,398,321.88 213,795,119.65 186,789,198.69
Add: Cash and cash equivalents at year-begin 562,832,319.76 490,154,426.30 452,405,704.33 384,695,931.50
VI. Cash and cash equivalents at the period-end 671,923,916.96 596,552,748.18 666,200,823.98 571,485,130.19
4.4 Auditors’ report
Audit opinion: un-audited
