Wafangdian Bearing Company Ltd. Midyear Report of 2012
Midyear Report of 2012
Section 1. Important notice
The board of directors, the supervisory committee, the director, the supervisor and the top
management guaranteed no false record, false statement of misleading data or major omission in the
report, and took associated responsibilities of the truth, accuracy and completeness.
All directors attended the meeting.
The Midyear financial report was not audited.
Chairman Mr. Wang Lushun, finance controller Mrs. Sun Najuan and financial charger Mrs.
Yao Chunjuan guaranteed the truth, completeness of the financial report in the Midyear report.
Section 2. Brief introduction of the Company
1.Brief introduction of the Company
A Code B Code 200706
A short name B short name 瓦轴 B
Listed Security exchange
Shenzhen Security exchange stock
stock
Chinese name of the
瓦房店轴承股份有限公司
Company
Abbreviation of Chinese
瓦轴股份公司
name
English name of the
Wafangdian Bearing Company Limited
Company
Abbreviation of English
WBC
name
Legal representative of
Wang Lushun
the Company:
Correspondence address No. 1 Beigongji Street, Wafangdian City, Liaoning Province, China.
Post code 116300
Office address of the
No. 1 Beigongji Street, Wafangdian City, Liaoning Province, China.
Company
Post code 116300
Website http://www.zwz-bearing.com
E-mail zwz2308@126.com
2. Correspondence
Secretary of the Board of Directors of Authorized Stock and Security Affairs
the Company Representative
1
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Name Sun Najuan Su Shaoli
No. 1 Beigongji Street, Wafangdian No. 1 Beigongji Street, Wafangdian
Address
City, Liaoning Province, China. City, Liaoning Province, China.
Tel. 0411-39116369 0411-39116731
Fax 0411-39116738 0411-39116738
E-mail zwz2308@126.com zwz2308@126.com
3. Information disclosure
Newspaper Securities Times, Hong Kong Commercial Newspaper
Website for disclosing half-year report http://www.cninfo.com.cn
Preparation and liaison office of this report Investment and Securities Department of the Company
Section 3. Abstract of accounting data and business data
1.Abstract of accounting data and business data
1.1Main financial indexes
Unit: RMB Yuan
Indexes 2012.01.01-2012.06.30 2011.01.01-2011.06.30 +/- to previous
Operating income 1,617,746,695.03 1,757,865,663.28 -7.97%
Operating profit 31,868,660.6 59,374,200.82 -46.33%
Total profits 33,429,844.45 63,961,198.24 -47.73%
Net profit available for shareholders
30,377,280.34 53,579,496.41 -43.3%
of listing company
Net profit available for shareholders
of listing company with abnormal 28,816,096.49 48,992,498.99 -41.18%
incomes deducted
Net cash flows from operation
148,855,325.74 91,389,270.77 62.88%
activities
2012.06.30 2012.01.01 +/- to previous
Total assets 3,619,556,728.62 3,533,795,515.58 2.43%
Owners’ equity (shareholders’
1,520,136,919.21 1,489,759,638.87 2.04%
equity)
Capital stock 402,600,000 402,600,000 0%
Main financial indicators
Indexes 2012.01.01-2012.06.30 2011.01.01-2011.06.30 +/- to previous
Basic gains on per share 0.08 0.13 -38.46%
Diluted gains on per share 0.08 0.13 -38.46%
Basic gains on per share with abnormal
0.07 0.12 -41.18%
incomes deducted
Fully diluted net returns on net asset 2.02% 3.64% -1.62%
Weighted average net returns on net 2.02% 3.64% -1.62%
2
Wafangdian Bearing Company Ltd. Midyear Report of 2012
asset
Fully diluted net returns on net asset
1.91% 3.33% -1.42%
with abnormal incomes deducted
Weighted average net returns on net asset
1.91% 3.33% -1.42%
with abnormal incomes deducted
Net cash flow on per share gained from
0.37 0.23 60.87%
operation activities
2012.06.30 2012.01.01 +/- to previous
Net assets on per share available for
3.78 3.70 2.16%
shareholders
Debt Asset ratio 58% 57.27% 0.73%
2. There are no differences between the CAS in aspect of financial data.
3. The deducted abnormal profits and losses
Unit: RMB Yuan
The item of the abnormal profits and losses Amount
Profits and losses relating to disposal of fixed assets 644,282.54
Profits and losses relating to the debt restructure -183,894.73
Others non-operating revenue and expense besides the above items 1,100,796.04
Total 1,561,183.85
Section 4. The change of capital stock and stocks holding
by major shareholders
1. Information on shareholders and actual controller
1.1 The number of the total shareholders at the end of the report period:
At the end of the report period, there are 8,825registered shareholders.
1.2. The top 10 main shareholders
Top ten shareholders’ status
Non-circulation Impawned and frozen shares
Name Nature Proportion Total shares
shares status status
Wang Fangdian Bearing Group State-owned
60.61% 244,000,000 244,000,000
Corporation shareholder
Foreign
AKTIEBOLAGET SKF 19.7% 79,300,000 0 frozen 79,300,000
shareholder
Foreign
GAOLING FUND,L.P. 1.82% 7,325,355 0
shareholder
Huang Junyue Others 0.89% 3,600,000 0
Ma Yuancheng Others 0.18% 742,325 0
MAN,KWAI WING 文贵荣 Others 0.18% 713,101 0
Chen Zhongwu Others 0.13% 532,800 0
Hei Youxin Others 0.13% 512,559 0
Merchant securities Hong Kong State-owned
0.12% 483,538 0
Company shareholder
3
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Yang Yufei Others 0.12% 466,030 0
(1)Wafangdian Bearing Group Corporation(Compay’s parent company) hold 244 million shares, which takes up
60.61%,(2) AKTIEBOLAGET SKF is company’s strategic investor, who held 79.3 thousand shares, takes up
Statement of shareholders 19.7%. In the report period, the frozen period of the shares purchased by the company’s strategic investor
AKTIEBOLAGET SK expired in 1999, and has not dealt with the releasing-procedure in this report period.
(3)The other shares are current shareholders
The top 10 current shareholders
Name Amount Type
AKTIEBOLAGET SKF 79,300,000 B
GAOLING FUND,L.P. 7,325,355 B
Huang Junyue 3,600,000 B
Ma Yuancheng 742,325 B
MAN,KWAI WING 文贵荣 713,101 B
Chen Zhongwu 532,800 B
Hei Youxin 512,559 B
Merchant securities Hong Kong Company 483,538 B
Yang Yufei 466,030 B
YHG INVESTMENT, L.P. 409,218 B
There is no relationship and consistent activities between the first big
shareholder and the top ten current shareholders in the major ten shareholders of
The explanation on the relationship and consistent the company, The relationship among other shareholders, top ten current
activities between above shareholders shareholders, top ten current shareholders and other shareholders is not
clear .strategic investor or general legal person become the top 10 shareholder
because of ration new shares.
1.3 Introduction to the holding shareholders
Relationship of the property right and controlling between the Company and actual Controller:
4
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Dalian MunicipalGovernment State-owned Assets
Supervising and Managing committee
100%shareholding
DalanEquipment Manufacture
InnovationInvestmentCompany Investment Company ZhongChengCompany
9.5%shareholding 3.5%shareholding
87%shareholding
Wafangdian Bearing Group Company
60.6% shareholding
Wafangdian Bearing Company Ltd
5
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Section 5 Information on Directors, Supervisors, senior management and employees
Increase Decrea Shares Include: Get salary in the
Shares
in this se in Holding Limited share-holding
Holding share option
period this in shares company and
Name Position Sex Age Term in the in the Changing reason
period the associated
year-be year-ending
year-endi companies(Y/N)
ginning
ng
Wang Lushun Chairman Male 62 2006.6-2012.6 0 0 0 0 0 0 0 Yes
Cong Hong Vice-Chairman Male 54 2009.6-2012.6 0 0 0 0 0 0 0 Yes
Shao Yang General Manager Male 46 2009.8-2012.6 0 0 0 0 0 0 0 No
Zhang Xinghai Director Male 44 2009.6-2012.6 0 0 0 0 0 0 0 Yes
Secretaryof No
Sun Najuan Session,General Female 44 2009.6-2012.6 0 0 0 0 0 0 0
accountant
Chen Jiajun Director Male 46 2011.6-2012.6 0 0 0 0 0 0 0 Yes
Fang Bo Director Female 41 2009.6-2012.6 1500 0 0 1500 1125 0 0 Yes
Rakesh Yes
Director Male 61 2010.10-2012.6 0 0 0 0 0 0 0
Makhija
Wang Huabin Independent Director Male 72 2009.8-2012.6 0 0 0 0 0 0 0 No
Wang Keyi Independent Director Male 69 2009.6-2012.6 0 0 0 0 0 0 0 No
Zhang Qiluan Independent Director Male 56 2009.6-2012.6 0 0 0 0 0 0 0 No
Liu Yuping Independent Director Male 57 2009.6-2012.6 0 0 0 0 0 0 0 No
President of Yes
Sun Maolin Supervisory Male 49 2009.6-2012.6 0 0 0 0 0 0 0
Committee
Wang Longjie Supervisor Male 51 2009.6-2012.6 0 0 0 0 0 0 0 No
Qu Rongjun Supervisor Male 58 2009.6-2012.6 0 0 0 0 0 0 0 Yes
Meng Wei Supervisor Male 45 2011.6-2012.6 0 0 0 0 0 0 0 Yes
Yao Chunjuan Supervisor Female 47 2009.6-2012.6 0 0 0 0 0 0 0 NO
Gao Yongyang Vice-G.M. Male 60 2009.8-2012.6 0 6 0 0 0 0 0 0 NO
Hua Yuehong Vice-GM Male 45 2009.8-2012.6 0 0 0 0 0 0 0 NO
Total
Wafangdian Bearing Company Ltd. Midyear Report of 2012
2. Posts occupied by the directors and supervisors in the shareholding units
Get salary in
the
share-holding
Name shareholders’ units Position Beginning term company and
associated
companies(Y/N
)
Chairman of Board of Directors, General
Wang Lushun Wafangdian Bearing Group Corp. Ltd 1998.12.01 Yes
Manager
Board of Directors Wafangdian Bearing Vice-chairman Yes
Cong Hong 2009.05.01
Group Corp. Ltd
hang Xinghai Wafangdian Bearing Group Corp. Ltd General accountant 2009.06.01 Yes
Chen Jiajun Wafangdian Bearing Group Corp. Ltd Assistant of GM 2011.06.01 Yes
Sun Maolin Wafangdian Bearing Group Corp. Ltd VGM 2007.05.01 Yes
Vice Charger of Technique Center Yes
Qu Rongjun Wafangdian Bearing Group Corp. Ltd 2009.07.01
The Chairmen of labor union and the Yes
Meng Wei Wafangdian Bearing Group Corp. Ltd 2003.03.01
Clerk of Discipline Inspection
Rakesh President Yes
SKF Asia Regional Headquarters 2012.01.01
Makhija
Fang Bo SKF (China) Investment Co,. Ltd. Financial Charger 2002.04.01 Yes
Posts occupied by the directors and supervisors in other units
Name units Position Get salary in the company (Y/N)
Dalian SKF-Wazhou Company Limited, Dalian Koyo
Wazhou Automobile Bearing Company Limited, DaLian
Wang Lushun Chairman No
THKWaZhou industrial company limited,Wafangdian
Hongda CVJ Manufacturing Company Limited
Dalian SKF-Wazhou Company Limited, Director
Wafangdian Bearing Precision Forging Company
Limited, Wa Zhou LiaoYang bearing manufacturing
Shao Yang company limited, WBGC Slewing Bearing Company No
Limited. Dalian Wazhou Feng Yuan Machinery
Company Limited and Dalian Wazhou Jin Zhou Chairman
Machinery Company Limited.
Meng Wei WBGC Precision Special Bearing Company Limited GM No
3. Payment information of the directors, supervisors, and top management in the report period.
Decision process of payment of the directors, supervisors, and top
management
Basis of payment of the directors, supervisors, and top management
Actual payment of directors, supervisors, and top management Pay by month
4. Employee
Among the employees on-the-job 5,736
The number of retired workers whose relative expenses should 3,104
7
Wafangdian Bearing Company Ltd. Midyear Report of 2012
be assumed by the Company
Professional constitute
professional constitute Total number
Production 4,619
Sales 271
Technical 204
Financial 82
Administrative 560
Education degree
Education degree category Total number
High school and the following 4,496
college 800
Bachelor degree 431
Master 9
Section 6. Work report of Board meeting
1. The summary of the business in the current period:
1.1 The discussion and analysis on the operation situation in the current period
Affected by mac-economy environment in this report period, the market’ performance is not good,
orders reduce and sale revenue increased slowly. Cost increase, capital employment increase and benefit
decline. At this situation, company speed up setting up sale-net actively and adjusting product structure,
which lead to an increase on product quality and operation quality to ensure the profit.
In the first half-year of 2012, the company’s operating incomes reached up to 1,617,746,695.03 Yuan
with an decrease by 7.97% comparing with the previous period; the operating profits reached up to
31,868,660.60 Yuan with an decrease by 46.33% comparing with the previous period; the net profits
reached up to 30,377,280.34 Yuan with an decrease by 43.30% comparing with the previous period.
1.2 Focus on the problems, company take some active measures in H2,to ensure the economy
operation quality in H2,and improve company’s gain ability and market competition ability.
(1) Implementing market developing target and grabbing orders，developing and maintaining big
clients at same time developing new clients, implementing responsibility on developing area market and
developing export market activity.
(2) Improving orders’ implement ratio to meet the market’s need, Reform Company’s production plan
system, implementing “E” project speedily and improving production efficiency, Implementing the short,
adaptable and fast projects and improving the production guarantee ability on key process.
(3) Improving product quality and carrying out quality tackling and technology improvement
(4) Implement measures on reducing cost expense, which include improving material use ratio,
planning material use reasonably, manage outsourcing strictly and controlling raw material purchasing
price.
(5) Compressing capital employment roundly, which to prevent operation risk. Enhancing credit
management and clearing up A/R roundly. Adjust steels inventory structure by using articles being
processed and surplus products and compressing stock funds
1.3 The industry developing trend
8
Wafangdian Bearing Company Ltd. Midyear Report of 2012
(1) develop market and product development according to national development around 16 special
technology, organize and develop 14 important projects , and research supporting bearing for clients at the
same time.
(2) Ensure important strategies on import substitute for market development , such as steel industry, the
truck engine industry, cement mechanical alternatives such as import market supporting bearing, especially
in high speed railway, car market, big the multi-megawatt wind turbines and offshore wind power
generation market has the very good market prospect, and common development already make into force.
(3)Take the customer cost improvement, to provide high cost-effective products. The share in car
industry, railway industry, the wind power industry and the industrial equipment market rise steadily
1.4 The market competition
At present Wazhou is in the domestic market leading position, but domestic bearing market
competition becomes increasingly fierce, especially foreign brands enter the Chinese market, set up
factories in China to expand investment, technology research and development center. Preempted the
domestic market in the service and price, especially in steel, which make a great impact on machine tool
and is wind power market to my company's market development and market sales.
Operation performance on main subsidy and equity-holding company
（1）subsidy
Unit: Yuan
Actual
investment
Company Registere Nature of Registered Business Holdin Voting Consolid
Company type amount at
name d address operation capital scope the end of g % % ation
year
No.61,
Production
Weiguo Production and
and sales of
road, Baita sales of bearing
Liaoyang Bearing Limited bearing and 19,350,000 17,337,259.95 100% 100% Y
district and machinery
machinery
Liaoyang manufacturing
manufacturing
city
No.12,
Shisanli Production
yongsheng and sales of Planning to
Dalian Electrical
Limited street, bearing and 10,000,000 develope 45,478,956.37 100% 100% Y
Equipment
free trade machinery project
zone Dalian manufacturing
city
（2）equity-holding company
Unit: Yuan
Investee Enterpri Register Legal Busines Regiser Holding Voting Total Total Total Total Net profits in the H1
9
Wafangdian Bearing Company Ltd. Midyear Report of 2012
se ed represe s nature ed % % assets liabilitie net sales of 2012
nature address ntative capital as at s as at assets revenue
June 30 June 30 as at in the
2012 2012 June 30 H1 of
2012 2012
Joint venture
No.1, Wang Manufactu
Phrase Lushun re and
Chinese
1, sales of
-foreign
Dalian SKF Wazhou Gongji ball-surfac 140,000 23,475. 4,517.8 18,957. 9,802.2
equity 49% 49% 609.18
Bearings Co., Ltd. Street, e rolling ,000 63 1 82 7
joint
Wafang bearing
venture
dian
North
All of the risk factors may effect to the future development strategy and the realization of the
operation target
1) Countries perform prudent monetary policy, the whole society of funds is tense, and the customer
the solvency is low, accounts receivable up is an important risk.
2) Some host industries such as steel, automobiles, wind business customers transferred cost to the
component enterprise, the low price effected enterprise's profit level reduced
3) In view of the market competition situation, SKF, FAG, NSK bearing transnational companies to
speed up to the penetration and the pace of expansion in China, put forward the development in China
"multiply plan", the acceleration of the speed of the factory in China. The product also of small and
medium-sized bearing by ever give priority to turn to auto bearing, railway bearings, overloaded bearing,
aviation bearing, wind power bearing and steel equipment and other high-end products with bearing of
production, and gradually occupied the commanding heights of the technology, ZWZ bearing industry to
the independent status puts forward a serious challenge
4) Multinational bearing group cooperate with the large enterprise joint venture in domestic, signed a
strategic cooperation agreement, and strengthening the multinational companies in China's dominant
industry of monopoly status
2. The main business scope of the company and its actual situation
2.1 Composing of main business income and main business profit
Unit: Yuan
According to
+/-(%) of +/-(%) of
industry or Operating income Operating cost BOI +/-(%) of BOI
operating income operating cost
product
according to industry
Export 136,789,260.11 137,835,006.35 -0.76% 48.59% 47.67% 0.63%
Traffic bearing 495,964,564.24 440,341,915.64 11.22% -10.21% -9.7% -0.5%
Special-used
282,818,191.38 237,585,214.27 15.99% -1.84% -0.76% -0.92%
bearing
General-used
403,687,524.75 350,746,226.95 13.11% -0.31% -0.36% 0.04%
bearing
Industrial work 53,811,589.56 59,693,569.81 -10.93% -25.35% -18.08% -9.84%
10
Wafangdian Bearing Company Ltd. Midyear Report of 2012
according to the products
Bearing 1,319,259,540.48 1,166,508,363.21 11.58% -1.36% -0.5% -0.77%
Component 53,811,589.56 59,693,569.81 -10.93% -25.35% -18.08% -9.84%
2.2. Main business from region
Unit: RMB Yuan
Region Operating income Compared with previous period +/-(%)
Export 136,789,260.11 48.59%
Domestic 1,236,281,869.93 -6.17%
Statement of main business from area: The area divide into export and home according to main business area.
Statement of Composing of main business income: The variety divides into product, Component and Industrial work.
Operation problems.
1) Sales revenue increased slowly and the development on product structure adjustment is imbalanced.
2) Order in some production line decrease, the production task dissatisfaction with the load.
3) Capital employment is big and the contradiction of the money tense is still obviously.
2.3 Application of non-B-share fund item:
Unit: RMB’0000 Yuan
First disclosure Capital Process Gains
Items
time
In large-scale reconstruction
Reforming new machines to form production
project tapered cylindrical August18,2012 574 Complete 35%
line, increase big-middle bearing ability
bearings t
Perfect substance cage production ability and
Substance cage construction
August 18,2012 108 Complete 25% environment to improve production
project
efficiency.
August 18,2012 Forming high level roller production ability,
Roller construction project 745 Complete 36%
improve production level
August 18,2012 Implementing production reform on car
process, rubbing and assemble automatic, to
Railway Bearing construction
391 Complete 30% make the railway truck bearing production
project
machine and craft level reach to international
standard
Precision big-entad ball August 18,2012 Complete Newly increased 2 production lines, forming
789
bearing construction project 100% key production ability
Precision machine tool August 18,2012 Improving matching level between
370 Complete 80%
bearing construction project production and detection.
August 18,2012 Perfecting top grade car bearing production,
Trucks bearing project 2,036 Complete 60%
and product quality.
August 18,2012 Make sure normal production installation
Others 179 Complete 20%
operation
Total 5,192
Statement of non-B-share fund investment project
Company transform project with non-B-share fund which improve company’s production ability and market competition ability. At
present all projects are under process, and some of which have finished basically
11
Wafangdian Bearing Company Ltd. Midyear Report of 2012
2.4 The cash distribution situation
According to the relevant requirement of cash dividends, made in listing rules and the China securities
supervision and management committee, the company perfects the articles of association strictly, make a
positive cash share out bonus policy; ensure the implementation of the cash dividends and implementation
in system.
Company perform strict decision procedure share out bonus, ensure the legitimacy of share out bonus
and compliance. After the end of each accounting year, the board of directors of the company proposed bill
share out bonus, and submit the shareholders' assembly vote. The company shareholders meeting on the
profit distribution plan make resolution, the board of directors of the company in the shareholders' general
meeting is completed within 2 months after the dividend (or stock) of the distributed matters. The company
accepts all shareholders, independent directors and supervisors of the company dividends advice and
supervision. According to company profit to decide whether undertake metaphase dividends or not. If
because of its need, company temporary not to cash the distribution of profits, will be in regular reports
disclosed in the mid-year report.
2.5 Establishment and implementation of the insider inside registration management system
The company has set up a file approved by the board of directors in 1998 issued the wafangdian bearing
Co., LTD insider information management system ", established the insider information management
system, and implemented well.
For more than 10 years the insider's information scope and personnel change greatly, according to the
CSRC and new requirements made by Shenzhen stock department, the company from revised and with
"watts strands of hair [2011] no. 25" wen issued the wafangdian bearing Co., LTD insider information
insider management system ", in May 27, 2011 to clear the inside information, insider information the
insider's scope, procedures for registration, and confidentiality and the responsibility investigation matters,
and further strengthened the insider information management, and maintain the information disclosure of
openness, fairness and justice.
According to the "on the listed companies to establish the inside information management system of
the registration of insider provisions and" big securities regulatory hair [2011] 229 "documentation
requirements, the company once again strengthen the insider's insider information management to put on
the important relevant units and related personnel seriously study, implement, and strictly enforced. The
company further perfected the insider information management, prevent the happening of the insider
trading effectively.
According to the related regulations, the company truthfully and completely fill in the listed company
insider information source files, " take note of the insider information in the public record before the report
in time, the transmission, prepare, review and disclosure every link all inside information insider list, and
insider knowledge of inside information such as time related files. The directors, supervisors and senior
management, the functional departments, and their subsidiary company’s principal heads ready to
cooperate with inside information insider registration work, to notify the company insider information
insider and changes in the related. The board of directors of the company secretary specifically in charge of
inside information insider registration work
12
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Section 7 Important events
1. Practical situation of corporation government
The Company followed the regulations of Company Law, Corporation Government Rules, the AOA,
etc to regulate its operations and perfect its corporation government step by step.
(1)、Perfect governance structure. The shareholders' meeting, board of directors and the board of
supervisors accordance with the requirement in “company law”, “the governance of listed company
principles” and other laws and AOA", clarify the responsibility, doing own job, mutual coordination and
balance each other, make full play of the "three meeting" and the executive decision, supervision and
management role, and to ensure the corporate governance structure of standard operation
(2) The company made a internal control system, and forming internal control system on budget,
procurement, logistics, sales and others, and enforced strictly.
(3) The separated situation in the business, personnel, assets and financial institutions between the
company and the controlling shareholders
1) The company has independent operation ability, separated from controlling shareholders in
business.
2) The company have an independent labor personnel management system; in personnel, labor and
salary management. Expect the company's parent company Wafangdian Bearing Group chairman
concurrently the company's chairman, the general manager, deputy general manager and financial
administrator is separated from controlling shareholders.
3) The company has separated from controlling shareholders in Production system, auxiliary
production system, supporting facilities
4) The company has separated from controlling shareholders in financial with independent
accounting, independent pay tax in accordance with law
5) Company set up the organization independent from the controlling shareholders.
2. In the report period, the Company was not involved in any material lawsuits or arbitration
issues.
3. There is no significant asset purchase, sales, disposal and enterprise purchase issues in the
report period.
4. There are no significant items in the report period.
5. Significant associated transactions in the report period:
5.1 associated transactions related with daily operation
13
Wafangdian Bearing Company Ltd. Midyear Report of 2012
The reason of
Occupies
Related Related Principle of Amount by the same Profit Market price difference
Type Content Price Account way between actual
parties relationship price ‘0000 Yuan transactions effected ‘0000 Yuan price and
(%)
market price
Dalian SKF Procurement of Pay currency or accept
Wazhou Procurement of finished Negotiated
Associates 8,654 4.69% note in accordance with Under 5%
Bearing Co., the products price
goods negotiated date
Ltd.
Wafangdian Other
Bearing companies Procurement of Pay currency or accept
Procurement of
Precision Ball controlled by semi-finished Market price 480 0.26% note in accordance with Under 5%
the products
Manufacturing the same parent products negotiated date
Co., Ltd. company
Wafangdian Other
Bearing companies Procurement of Negotiated Pay currency or accept
Procurement of
Precision controlled by semi-finished price refer to 13,485 7.3% note in accordance with Under 5%
the products
Forging Co., the same parent products market price negotiated date
Ltd. company
Dalian
Other Procurement of
Wafangdian
companies finished Negotiated Pay currency or accept
Bearing Procurement of
controlled by price refer to 877 0.48% note in accordance with Under 5%
Equipment the products Goods and
the same parent market price negotiated date
Manufacturing labor
company
Co., Ltd.
Other
Wafangdian companies Procurement of Negotiated Pay currency or accept
Procurement of finished
Slewing controlled by price refer to 4,746 2.57% note in accordance with Under 5%
the products
Bearing Co.Ltd the same parent goods market price negotiated date
company
WBGC Other
Precision companies Procurement of Negotiated Pay currency or accept
Procurement of finished
transmission controlled by price refer to 6,894 3.73% note in accordance with Under 5%
the products
driving Bearing the same parent goods market price negotiated date
Co.,Ltd company
WBGC Other Procurement of Negotiated Pay currency or accept
Precision companies Procurement of finished
price refer to note in accordance with Under 5%
transmission controlled by the products market price negotiated date
goods
driving Bearing the same parent
14
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Co.,Ltd company
Da Lian
Wazhou Feng
Procurement of Negotiated Pay currency or accept
Yuan Other Related Procurement of
car work price refer to 5,348 2.9% note in accordance with Under 5%
Machinery party the products
piece market price negotiated date
Company
Limited
Da Lian
Wazhou Jin
Procurement of Negotiated Pay currency or accept
Zhou Other Related Procurement of
car work price refer to 5,022 2.72% note in accordance with Under 5%
Machinery party the products
piece market price negotiated date
Company
Limited
Subtotal 45,506 24.64%
Wafangdian Supply of
Bearing finished Negotiated Take currency or accept
Parent Supply of
price refer to -858 -0.53% note in accordance with Under 5%
Group company: products goods and market price negotiated date
Corporation material
Dalian Supply of
SKF-Wazhou Supply of semi-finished Negotiated Take currency or accept
Bearing Associates products and products, price refer to 2,975 1.84% note in accordance with Under 5%
Company labor material and market price negotiated date
Limited industrial work
Wafangdian Other
Bearing companies Take currency or accept
Supply of Supply of
Precision Ball controlled by Market price 437 0.27% note in accordance with Under 5%
products material
Manufacturing the same parent negotiated date
Co., Ltd company
Wafangdian Other
Bearing companies Negotiated Take currency or accept
Supply of Supply of
Precision controlled by price refer to 18,632 11.52% note in accordance with Under 5%
products material
Forging Co., the same parent market price negotiated date
Ltd. company
Dalian Other Supply of
finished Take currency or accept
Wafangdian companies Supply of
Market price 129 0.08% note in accordance with Under 5%
Bearing controlled by products goods and negotiated date
Equipment the same parent material
15
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Manufacturing company
Co., Ltd.
Other Supply of semi
Wafangdian companies Take currency or accept
Supply of finished
Slewing controlled by Market price 1,053 0.64% note in accordance with Under 5%
products goods and
Bearing Co.Ltd the same parent material
negotiated date
company
WBGC Other Supply of
Precision companies Supply of semi-finished Take currency or accept
transmission controlled by products and products, Market price 1,789 1.1% note in accordance with Under 5%
driving Bearing the same parent labor material and negotiated date
company industrial work
Co.,Ltd
WBGC Other Supply of
companies Supply of semi-finished Take currency or accept
precision
controlled by products and products, Market price 622 0.38% note in accordance with Under 5%
special bearing the same parent labor material and negotiated date
Co., Ltd company industrial work
Da Lian
Wazhou Jin Supply of
Supply of Take currency or accept
Zhou Other Related semi-finished
products and Market price 172 0.11% note in accordance with Under 5%
Machinery party products and
labor negotiated date
Company industrial work
Limited
Subtotal 24,949 15.14%
Total -- -- 70,455 -- -- -- --
The details of big goods rejected None
The necessary, constancy and the reason to trade with the
Qualified quality and reasonable price
associated parties but not other companies.
influence to listing company’s independence No influence to listing company’s independence
The extent does company depends on the associated parties and
None
related measures to solve it.
The actual performance of the daily associated transactions whose
total amount has been forecasted by classes in the reporting None
period.
Statement of associated transactions Related with daily operation
16
Wafangdian Bearing Company Ltd. Midyear Report of 2012
5.2 The sale of products (merchandise)or supply of labor and The purchase of products (merchandise)or receipt of labor
Unit: ‘0000 Yuan
The sale of products (merchandise)or supply of labor: The purchase of products (merchandise)or receipt of labor:
Related parties
Amount Percentage (%) Amount Percentage (%)
Equity-holding and ultimate actual controller
Incl: Wafangdian Bearing Group Corporation -8,581,155.49 -0.53%
Joint venture enterprise
Incl：Dalian SKF Wazhou Bearing Co.,
29,748,687.88 1.84% 86,536,401.16 4.69%
Ltd.(SKF Wazhou)
under the same equity holding enterparies
Incl：Wafangdian Bearing Precision Steel
Ball Manufacturing Co., Ltd.（Precision 4,365,001.45 0.27% 4,795,034.2 0.26%
Ball）
Wafangdian Bearing Precision Forging Co.,
186,322,652.28 11.52% 134,851,660.65 7.3%
Ltd.（Precision Forging）
Dalian WBGC Bearing Equipment
Manufacturing Co., Ltd.（Equipment 1,287,960.84 0.08% 8,773,401.12 0.48%
Manufacturing）
WBGC Slewing Bearing Co.,Ltd 10,525,530.76 0.64% 47,462,221.5 2.57%
WBGC transmission driving Bearing Co.,Ltd 17,888,650.88 1.1% 68,942,848.37 3.73%
WBGC Precision Specialty Bearing Co.,Ltd 6,216,993.25 0.38%
Other related parties
Dalian wazhou fengyuan machinery
53,480,698.48 2.9%
company
Dalian wazhou jinzhou machinery company 1,716,641.66 0.11% 50,220,644.83 2.72%
Total 249,490,963.51 15.14% 455,062,910.31 24.64%
17
Wafangdian Bearing Company Ltd. Midyear Report of 2012
6. Investigation, communication and interview, etc. in the report period
Time Site Method Object Content and documents supplied
Telephone The general information of the
February 2,2012 Office Private investor
communication company
Telephone The general information of the
February 24,2012 Office Private investor
communication n company
Telephone The general information of the
April 10,2012 Office Private investor
communication company
Telephone The general information of the
May 30,2012 Office Private investor
communication company
7. In the report period, information on the changing or dismissing of the certified public
accountants
The mid-year report is un-audited
8. The disclosure information
.
Information disclosure
Item Date Website
newspapers and layout
Wafangdian Bearing Company Limited
Announcement of receiving the"The first Times , A20
D50 of Securities
and second batch of New and High of Hong Kong Commercial March 23,2012 http://www.cninfo.com.cn
technology Enterprise of Da Lian Newspaper
Municipality in 2011
Times、A16
B67 of Securities
Wafangdian Bearing Company Limited
of Hong Kong Commercial April 21,2012 http://www.cninfo.com.cn
2011 Annual Report Abstract
Newspaper
Times、A16
B67 of Securities
The First Quarterly Report for 2012
Kong Commercial
of Hong April 21,2012 http://www.cninfo.com.cn
(Main Text)
Newspaper
Wafangdian Bearing Company Limited Times、A16
B67 of Securities
Announcement of Resolution of the 10 of Hong Kong Commercial April 21,2012 http://www.cninfo.com.cn
Meeting of 5th Board Session Newspaper
Wafangdian Bearing Company Limited Times、A16
B67 of Securities
Announcement of Resolution of the 9th Kong Commercial
of Hong April 21,2012 http://www.cninfo.com.cn
Meeting of 5th Board of Supervisors Newspaper
Announcement of the Company in 2011 the Times、A16
B67 of Securities
implementation of related party daily
transactions and estimated related daily of Hong Kong Commercial April 21,2012 http://www.cninfo.com.cn
transactions in 2012 Newspaper
Wafangdian Bearing Co., Ltd. Times、A20
D2 of Securities
Announcement of holding 2011 Annual Kong Commercial
of Hong May 30,2012 http://www.cninfo.com.cn
Shareholders’ Meeting Newspaper
Wafangdian Bearing Company Limited Times、A24
D14 of Securities
Announcement of Resolution of 2011 annual of Hong Kong Commercial June 20,2012 http://www.cninfo.com.cn
shareholders’ meeting Newspaper
18
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Section 7 Financial Statements (un-audited)
Wa Fangdian Bearing Co.,Ltd
Balance Sheet
2012.01.01---2012.06.30
Unit:RMByuan
2012.06.30 2011.12.31
Item
Consolidated Parent Consolidated Parent
Current assets：
Monetary capital 123,538,598.29 122,066,618.48 102,268,754.34 99,822,886.26
Settlement preparation cash
Borrowing capital
Trading financial assets
Notes receivables 242,813,248.25 239,683,248.25 134,514,385.38 133,080,700.75
Account receivables 1,021,519,948.21 1,032,265,592.86 948,225,066.12 986,005,682.37
Prepayment 17,857,918.72 16,925,576.92 52,716,821.34 42,733,044.64
Interests receivables
Dividend receivables
Other receivables 16,992,877.73 11,446,642.40 15,528,274.87 10,024,049.56
Inventories 1,112,109,223.57 1,037,502,464.71 1,196,538,970.43 1,113,765,356.87
Non current assets due within 1
year
Other current assets 2,862,419.12 2,862,419.12 5,729,224.48 5,729,224.48
Subtotal current assets 2,537,694,233.89 2,462,752,562.74 2,455,521,496.96 2,391,160,944.93
Non-current assets：
Long-term receivables
Long-term equity investment 95,064,038.62 152,258,840.19 92,489,891.01 149,684,692.58
Investment-purpose real estate
Fixed assets 569,798,681.22 453,817,526.17 581,464,704.26 462,781,080.04
Construction in process 276,849,231.62 276,660,775.12 261,981,026.05 261,978,608.05
Projects materials
Disposal of fixed assets
Productive biologic assets
Petro and gas assets
Intangible assets 129,834,461.74 129,834,461.74 131,979,409.06 131,979,409.06
exploitation expense
Reputation
Long-term prepaid expenses 826,598.29 826,598.29 869,505.00 869,505.00
Deferred income tax assets 9,489,483.24 9,489,483.24 9,489,483.24 9,489,483.24
Other non-current assets
1,022,887,684.75 1,016,782,777.97
Subtotal non-current assets
1,081,862,494.73 1,078,274,018.62
Total assets 3,619,556,728.62 3,485,640,247.49 3,533,795,515.58 3,407,943,722.90
19
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Current liabilities ：
Short-term loans 653,590,235.14 640,000,000.00 523,590,235.14 510,000,000.00
Trading financial liabilities
Notes payables 195,714,142.09 195,714,142.09 94,100,000.00 94,100,000.00
Account payables 985,589,322.57 885,876,833.93 1,039,300,493.29 955,695,514.30
Advances from customers 42,240,461.57 40,931,048.58 50,407,895.65 49,634,480.69
Fees and commission payables
Accrued payroll 24,043,991.45 15,034,194.76 29,508,584.94 20,368,041.18
Tax payables 17,360,714.92 13,014,441.27 1,923,642.12 4,172,462.78
Interests payables
Other payables 123,639,215.70 82,210,137.70 116,242,681.68 68,874,443.35
Provision for the insurance
contract
Non-current liabilities due
8,000,000.00 8,000,000.00 138,000,000.00 138,000,000.00
within 1 year
Other current liabilities
Subtotal current liabilities 2,050,178,083.44 1,880,780,798.33 1,993,073,532.82 1,840,844,942.30
Non-current liabilities ：
Long-term loans
Debenture payables
Long-term account payables 100,000.00 100,000.00
Special account payables 221,698.98 221,698.98 221,698.98 221,698.98
Predicted liabilities
Deferred income tax liabilities 246,635.79 246,635.79
Other non-current liabilities 48,673,391.20 48,673,391.20 50,394,009.12 50,394,009.12
Subtotal non-current liabilities 49,241,725.97 48,895,090.18 50,962,343.89 50,615,708.10
Total liabilities 2,099,419,809.41 1,929,675,888.51 2,044,035,876.71 1,891,460,650.40
Owner’s equity（shareholders’
equity）：
Capital stock 402,600,000.00 402,600,000.00 402,600,000.00 402,600,000.00
Capital public reserves 485,691,050.47 482,563,945.37 485,691,050.47 482,563,945.37
less：stock shares
Surplus public reserves 123,972,268.17 123,972,268.17 123,972,268.17 123,972,268.17
General provision for risk
Undistributed profits 507,873,600.57 546,828,145.44 477,496,320.23 507,346,858.96
Total owner’s equity available for
parent company 1,520,136,919.21 1,555,964,358.98 1,489,759,638.87 1,516,483,072.50
Minority owner’s equity
Total owner’s equity 1,520,136,919.21 1,555,964,358.98 1,489,759,638.87 1,516,483,072.50
Total liabilities and owner’s equity 3,619,556,728.62 3,485,640,247.49 3,533,795,515.58 3,407,943,722.90
20
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Wa Fangdian Bearing Co.,Ltd
Income statement
2012.01.01---2012.06.30
Unit:RMByuan
2012.06.30 2011.06.30
Item
Consolidated Parent Consolidated Parent
1.Total operating revenue 1,617,746,695.03 1,610,534,206.84 1,757,865,663.28 1,749,590,632.89
including：operating revenue
Interest revenue
2.Total operating cost 1,588,856,098.95 1,572,714,129.79 1,704,793,996.96 1,695,876,782.93
including：operating cost 1,433,460,380.71 1,426,359,883.98 1,549,779,169.18 1,548,503,038.12
Interest payment
Operating tax and adds 6,385,704.89 6,218,981.76 6,618,239.08 6,361,293.21
Sales expense 104,774,136.63 104,068,079.19 104,038,854.06 102,944,125.96
Administrative expense 30,125,540.59 22,269,686.56 31,813,142.30 25,779,116.76
Financial expense 13,815,248.96 13,502,411.13 12,337,942.40 12,082,558.94
Loss on depreciation of
assets 295,087.17 295,087.17 206,649.94 206,649.94
plus：gains on the changes of
fair value （loss as “-”）
Gains on investment（loss as “-”） 2,978,064.52
2,978,064.52 6,302,534.50 6,302,534.50
Including: the gains on
investment to affiliated and joint 2,978,064.52
stock companies 2,978,064.52 6,302,534.50 6,302,534.50
Gains on currency exchange（loss
as “-”）
31,868,660.60 40,798,141.57 59,374,200.82 60,016,384.46
3.Operating profits（loss as “-”）
plus：non-operating revenue 3,974,650.29 3,483,559.87 5,602,126.12 3,902,738.40
less：non-operating expenses 2,413,466.44 1,747,850.85 1,015,128.70 455,824.73
including：losses on disposal of
non-current assets 33,413.92 33,413.92
4.Total profits（loss as “-”） 33,429,844.45 42,533,850.59 63,961,198.24 63,463,298.13
Less: income tax 3,052,564.11 3,052,564.11 10,381,701.83 10,381,701.83
5.Net profits（net loss as “-”） 30,377,280.34 39,481,286.48 53,579,496.41 53,081,596.30
Net profits available for parent
company
Minority owner’s equity
6.Gains on per share
basic gains on per share 0.08 0.10 0.13 0.13
diluted gains on per share 0.08 0.10 0.13 0.13
7.Other comprehensive returns
8.Total comprehensive returns
Total comprehensive returns
21
Wafangdian Bearing Company Ltd. Midyear Report of 2012
available for parent company
Total comprehensive returns
available for minority shareholders
Wa Fangdian Bearing Co.,Ltd
Cash flow statement
2012.01.01---2012.06.30
Unit:RMByuan
2012.06.30 2011.06.30
Item
Consolidated Parent Consolidated Parent
1 Cash flow from operating
activities
Cash received from sales of
646,285,337.83 667,620,105.77 689,708,029.75 698,313,243.84
goods or rendering services
Refunds of taxes
Cash received relating to other
operating activities 7,671,109.14 7,671,109.14 7,890,682.24 2,891,329.49
Sub-total of cash inflows from
operating activities 653,956,446.97 675,291,214.91 697,598,711.99 701,204,573.33
Cash paid for goods or
270,585,561.67 325,756,259.45 346,607,556.83 379,929,312.04
receiving services
Cash paid to and on behalf of
employees 126,124,633.85 102,006,163.07 141,325,005.75 122,067,382.04
Tax payments 29,729,831.00 27,148,770.37 51,042,443.76 47,575,932.05
Cash paid relating to other
operating activities 78,661,094.71 71,161,503.32 67,234,434.88 59,132,811.67
Sub-total of cash outflows from
operating activities 505,101,121.23 526,072,696.21 606,209,441.22 608,705,437.80
Net Cash Flow from Operating
Activities 148,855,325.74 149,218,518.70 91,389,270.77 92,499,135.53
2 Cash Flow from Investing
Activities
Cash received from disposal of
403,916.91 403,916.91
investments
Cash received from investments
income
Net cash received from disposal
637,836.53
of fixed assets, intangible assets and 131,500.00
other long-term assets 705,000.00 637,836.53
Cash received from disposal of
subsidiary or other operating
business units
Cash received relating to other
investing activities
Sub-total of cash inflows 1,108,916.91 535,416.91 637,836.53 637,836.53
22
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Cash paid to acquire fixed
7,289,836.61 7,116,620.11 52,070,561.57 42,023,184.89
assets, intangible assets and other
long-term assets
Cash paid to acquire
investments
Net increase of the mortgage
loans
Cash payments relating to other
investing activities
Sub-total of cash outflows 7,289,836.61 7,116,620.11 52,070,561.57 42,023,184.89
Net Cash Flow from Investing
Activities -6,180,919.70 -6,581,203.20 -51,432,725.04 -41,385,348.36
3 Cash Flow from Financing
Activities
Cash received by investors
193,000,000.00
Cash received from borrowings 508,385,611.16 508,385,611.16 198,170,000.00
Cash from issuing debenture
Cash received relating to other
financing activities
Sub-total of cash inflows 508,385,611.16 508,385,611.16 198,170,000.00 193,000,000.00
Repayments of borrowings 600,770,466.67 599,860,466.67 193,000,000.00 193,000,000.00
Cash payment for dividends,
19,833,117.08 16,810,700.70
profits and the interests 19,934,095.89 17,083,336.79
Cash payments relating to other
financing activities
Sub-total of cash outflows 620,704,562.56 619,693,583.75 210,083,336.79 209,810,700.70
Net Cash Flow from Financing
Activities -112,318,951.40 -111,307,972.59 -11,913,336.79 -16,810,700.70
4 Effect of cash and cash
equivalents Foreign Currency
Translation 102,513.80 102,513.80 -161,610.20 -161,610.20
5 Net Increase (Decrease) in Cash
and Cash Equivalents 30,457,968.44 31,431,856.71 27,881,598.74 34,141,476.27
plus：the balance in the
period-beginning 62,187,956.71 59,742,088.63 52,057,009.69 43,756,831.34
6 The balance in the period-end 92,645,925.15 91,173,945.34 79,938,608.43 77,898,307.61
The annotation is enclosed as the complement of the above statements.
The balance sheet (consolidated and parent), the income statement (consolidated and parent) and the
cash flow statement (consolidated and parent) have been approved by the board meting held on
August 16, 2012.
Charger : Shao Yang Charger : Sun Najuan
23
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Wafangdian Bearing Co., Ltd.
The changes of owner’s equity (consolidated)
June 30, 2012
Unit: RMB yuan
Amount of this period Amount of previous period
Owner’s equity attributed to parent Owner’s equity attributed to parent
items Paid-in Reserves Minority Total Paid-in Reserves Minority Total
Minus: Undistrib Minus: Undistri
capital Capital Surplus for Other owner’s owner’s capital Capital Surplus for owner’s owner’s
stock uted equity equity (capital surplus stock reserves general buted Others equity equity
(capital surplus reserves general s
shares profits shares profits
stock) risks stock) risks
1.Balance in the previous
402,600,0 485,691,0 123,972,2 477,496,3 1,489,75 402,600, 485,691, 116,726,0 440,320, 1,445,33
year-end
00.00 50.47 68.17 20.23 9,638.87 000.00 050.47 55.56 203.69 7,309.72
Plus : the changes in
accounting standards
Correction to previous
2.Balance in current 402,600,0 485,691,0 123,972,2 477,496,3 1,489,75 402,600, 485,691, 116,726,0 440,320, 1,445,33
year-beginning 00.00 50.47 68.17 20.23 0.00 9,638.87 000.00 050.47 55.56 203.69 0.00 7,309.72
3.The increase or
decrease in this period 30,377,28 30,377,2 7,246,212 37,176,1 44,422,3
(decrease as -) - - - - - 0.34 - - 80.34 - - - .61 - 16.54 - - 29.15
(1)Net profits 30,377,28 30,377,2 60,526,3 60,526,3
0.34 0.00 80.34 29.15 - 29.15
（2）others
0.00 - 0.00 0.00
Total of (1) and (2) 30,377,28 30,377,2 60,526,3 60,526,3
0.00 0.34 0.00 80.34 0.00 29.15 0.00 29.15
(3) the investment or
withdrawal of the owner
1) the investment
2)the shares calculated
into the owner’s equity
3)others
-16,104,
(4) profits distribution
- - 7,246,212 -23,350, 000.00
24
Wafangdian Bearing Company Ltd. Midyear Report of 2012
.61 212.61
1 )withdrawal of surplus
7,246,212 -7,246,2
reserves
.61 12.61
2).withdrawal of reserves
for general risks
3)distribution to owners
-16,104, -16,104,
and shareholders
- 000.00 000.00
4)others
(5)owner’s equity
internally transferred
(1)transferring
capital reserves to
capital (capital
stock)
(2) transferring surplus
reserves to capital
(capital stock)
(3)Offsetting the loss by
surplus reserves
(4).Others
4.Balance in current 1,489,75
402,600,0 485,691,0 123,972,2 507,873,6 1,520,13 402,600, 485,691, 123,972,2 477,496,
period-end 9,638.87
00.00 50.47 68.17 00.57 0.00 6,919.21 000.00 050.47 68.17 320.23
Wafangdian Bearing Co., Ltd.
The changes of owner’s equity (Parent Company)
June 30, 2012
Unit: RMByuan
Amount of this period Amount of previous period
Owner’s equity attributed to parent Minority Total Owner’s equity attributed to parent Minority Total
items
Paid-in Capital Minus: Surplus Reserve Undistri Others owner’s owner’s Paid-in Capital Minus: Surplus Reserve Undistri Others owner’s owner’s
capital surplus stock reserves s for buted equity equity capital surplus stock reserves s for buted equity equity
25
Wafangdian Bearing Company Ltd. Midyear Report of 2012
(capital shares general profits (capital shares general profits
stock) risks stock) risks
1.Balance in the previous
402,600, 482,563, 123,972, 507,346, 1,516,48 402,600, 482,563, 116,726, 458,234, 1,460,12
year-end
000.00 945.37 268.17 858.96 3,072.50 000.00 945.37 055.56 945.44 4,946.37
Plus : the changes in
accounting standards
Correction to previous
2.Balance in current 402,600, 482,563, 123,972, 507,346, 1,516,48 402,600, 482,563, 116,726, 458,234, 1,460,12
year-beginning 000.00 945.37 268.17 858.96 3,072.50 000.00 945.37 055.56 945.44 4,946.37
3.The increase or decrease in 7,246,21
39,481,2 39,481,2 49,111,9 56,358,1
this period (decrease as -) 2.61
86.48 86.48 13.52 26.13
(1)Net profits 39,481,2 39,481,2 72,462,1 72,462,1
86.48 86.48 26.13 26.13
（2）others
- 0.00 0.00
39,481,2 39,481,2 72,462,1 72,462,1
Total of (1) and (2) 0.00
86.48 86.48 26.13 26.13
(3) the investment or
withdrawal of the owner
1) the investment
2)the shares calculated into the
owner’s equity
3)others
-16,104,
(4) profits distribution 7,246,21 -23,350,
000.00
2.61 212.61
1 )withdrawal of surplus
7,246,21 -7,246,2
reserves
2.61 12.61
2).withdrawal of reserves for
general risks
3)distribution to owners and -16,104,
-16,104,
shareholders 000.00
000.00
4)others
26
Wafangdian Bearing Company Ltd. Midyear Report of 2012
(5)owner’s equity internally
transferred
(1)transferring capital
reserves to capital
(capital stock)
(2) transferring surplus reserves
to capital (capital stock)
(3)Offsetting the loss by
surplus reserves
(4).Others
402,600, 482,563, 123,972, 546,828, 1,555,96 402,600, 482,563, 123,972, 507,346, 1,516,48
4.Balance in current period-end
000.00 945.37 268.17 145.44 4,358.98 000.00 945.37 268.17 858.96 3,072.50
27
Wafangdian Bearing Company Ltd. Midyear Report of 2012
3. General information
Wafangdian Bearing Company Limited (the “Company”) is a joint stock limited company established in the People’s
Republic of China (the “PRC”) on 20 March 1997. In the opinion of the directors, its parent and ultimate holding
company is Wafangdian Bearing Group Company Limited (“Wazhou Group”).
The Company’s B shares have been listed on the Shenzhen Stock Exchange since 25 March 1997.
The addresses of the registered office and principal place of business of the Company are No.1, Phrase 1, Gongji Street,
Wafangdian North, Liaoning Province, and the PRC.
The Company is principally engaged in the manufacturing and sale of bearing products, engineering equipment,
automobile spare parts and relating products.
The Company together with its subsidiaries is collectively referred to as the “Group”.
4. Main accounting policy, estimation and correction of previous errors
4.1 basis for financial statements preparation
The Group prepares the financial statements on the basis of going concern and actual transactions and events, and in
accordance with the Accounting Standards for Business Enterprises issued by the Ministry of Finance of the People’s
Republic of China, and based on the accounting policies and estimates in the note 4 ‘Significant accounting policies,
accounting estimates and method for preparation of consolidated financial statements’.
4.2 Complying with Accounting Standard for Business Enterprise
The financial statements are prepared by the Group according to the requirements of Accounting Standard for Business
Enterprise, and reflect the relative information for the financial position, operating performance, cash flow of the Group
truly and fully.
4.3 Accounting period
The Group adopts the Gregorian calendar year as accounting period, i.e. from Jan 1 to December 31.
4.4 Funcitonal currency
The Group adopts RMB as functional currency.
4.5 The accounting settling method of business combination
(1) Business combination under the same control
The assets and liabilities that the combining party obtains in a business combination under the same control should 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, the capital surplus shall be adjusted. If the capital surplus is not sufficient to be offset, the retained earnings shall be
adjusted.
（2）Business combination not under same control
For a business combination not under same control, the combination cost shall be the fair value, on the acquisition date, of
the assets paid, the liabilities incurred or assumed and equity securities issued by the acquirer in exchange for the control
of the acquiree. The difference when combination cost exceeds the fair value of identifiable net assets of acquiree should
be recognized as goodwill. If the combination cost is less than the he fair value of identifiable net assets of acquiree, the
difference should be recognized as current profit or loss.
4.6 Method of preparation of consolidated financial statements
Recognition principle of scope of consolidation: Scope of consolidated financial statements should include all subsidiaries
of the parent and the special purpose entities.
Accounting method of consolidated financial statements
The Group’s consolidated financial statements had been prepared in accordance with and related regulations. All material intragroup transaction and
balance had been eliminated in full. The parts of subsidiaries’ equity non-attributable to parent company shall be as
minority interest presented in the in the consolidated balance sheet within equity.
Where there are inconsistent accounting policies or accounting period, when preparing the consolidated financial
statements, the Group shall adjust the subsidiaries’ financial statements in accordance with the Group’s accounting
policies and accounting period.
For the subsidiary obtained under different control, when preparing the consolidated financial statements, the Group shall
adjust the separate financial statements based on the fair value of identifiable net assets at the purchase date; for the
subsidiaries combined by the Group under the same control, regard the subsidiaries that they have been existing since the
beginning of the period, and the assets, liabilities, operation performance and cash flows shall be consolidated into the
financial statements of the beginning of the combination period according to their original book value.
4.7 Cash and cash equivalent standard
The cash listed on the cash flow statements of the Group refers to cash on hand and bank deposit. The cash equivalents
refer to short-term (normally with original maturities of three months or less) and liquid investments which are readily
convertible to known amounts of cash and subject to an insignificant risk of changes in value.
4.8 Translation of foreign currency
(1) Foreign currency transaction
Foreign currency transactions are translated at the spot exchange rate issued by People’s Bank of China (“PBOC”) when
the transaction incurs. Monetary assets and liabilities in foreign currencies are translated into RMB at the exchange rate
prevailing at the balance sheet day. Exchange differences arising from the settlement of monetary items are charged as in
profit or loss for the period. Exchange differences of specific borrowings related to the acquisition or construction of a
fixed asset should be capitalized as occurred, before the relevant fixed asset being acquired or constructed is ready for its
intended uses. The foreign currency non-monetary items recorded at fair value are translated at the exchange rate issued
on the date of fair value recognized. Exchange differences are charged as profit and loss of change of fair value. The
foreign currency non-monetary items recorded at historical cost are translated at the exchange rate issued on the date when
the transaction incurs, and don’t change the RMB amount.
(2) Translation of foreign currency financial statements
The asset and liability items in the foreign currency balance sheet should be translated at a spot exchange rate at the
balance sheet date. Among the ower’s equity items except “undistributed profit”, others should be translated at the spot
exchange rate when they are incurred. The income and expense should be translated at spot exchange rate when the
transaction incurs. Translation difference of foreign currency financial statements should be presented separately under the
ower’s equity item. For the foreign currency monetary items that form substantially the oversea business net investment,
their exchange difference of movement of exchange rate should be presented separately as translation difference of
foreign currency financial statement under the ower’s equity item when prepare the consolidated financial statements.
When disposing an overseas business, the Group should shift the translation difference of foreign currency financial
statement related to the overseas business into the disposal profits and losses of current period. Foreign currency cash
flows are translated at the spot exchange rate on the day when the cash flows incur. The amounts resulted from change of
exchange rate are presented separately in the cash flow statement.
4.9 Financial tools
Financial tools means forming financial assets and financial liability as well as equity tools contract.
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Wafangdian Bearing Company Ltd. Midyear Report of 2012
（1）classification
The Group classifies its financial assets in the following categories: at fair value through profit or loss, loans and
receivables, held-to-maturity financial assets and available-for-sale. The classification depends on the purpose for which
the financial assets were acquired. Management determines the classification of its financial assets at initial recognition.
a)Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss are financial assets held for trading. A financial asset is classified in
this category if acquired principally for the purpose of selling in the short term. Derivatives are also categorised as held for
trading unless they are designated as hedges. Assets in this category are classified as current assets if expected to be
settled within 12 months; otherwise, they are classified as non-current.
b)Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an
active market. They are included in current assets, except for maturities greater than 12 months after the reporting period,
which are classified as non-current assets.
c)Held-to-maturity financial assets
Held-to-maturity financial assets are non-derivative financial assets with fixed or determinable payments and fixed
maturities that the Groups management has the positive intention and ability to hold to maturity. If the Group were to sell
other than an insignificant amount of held-to-maturity financial assets, the whole category would be tainted and
reclassified as available for sale. Held-to-maturity financial assets are included in non-current assets, except for those with
maturities less than 12 months from the end of the reporting period, which are classified as current assets.
d)Available-for-sale financial assets
Available-for-sale financial assets are non-derivatives that are either designated in this category or not classified in any of
the other categories. They are included in non-current assets unless the investment matures or management intends to
dispose of it within 12 months of the end of the reporting period.
（2）Recognition and measurement
1）Financial assets
Financial assets are recognized at fair value on the balance sheet when the Group becomes a party to the contractual
provisions of the financial instrument. Transaction costs of financial assets carried at the fair value through profit or loss
are expensed in the income statement;Transaction costs of other financial assets are included in financial assets at initial
recognition.
Available-for-sale financial assets are subsequently measured at fair value. Investments inequity instruments are measured
at cost when they do not have a quoted market price in an active market and whose fair value cannot be reliably measured.
Loans and receivables are measured at amortised cost using the effective interest method.
A gain or loss arising from change in fair value of an available-for-sale financial asset is recognised directly in equity,
except for impairment losses and foreign exchange gains and losses arising from the translation of monetary financial
assets. When such financial asset is derecognised, the cumulative gain or loss previously recognised in equity is
recognised in income statement. Interest on available for sale debt instrument, calculated using effective interest method,
and cash dividends declared by the investee on available-for-sale equity instruments are recognised as investment income
in income statement.
2）Financial liabilities
The financial liabilities are classified into the financial liability at fair value through profit or loss and other financial
liability for the initial recognition.
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Wafangdian Bearing Company Ltd. Midyear Report of 2012
The financial liabilities at fair value through profit or loss include the financial liabilities held for trading and the
designated financial liabilities at fair value through profit or loss when initial recognized. For this kind of financial
liabilities should be measured at fair value, variation of fair value should be recorded into the current profit or loss.
Other financial liabilities should be subsequently measured at amortization cost by adopting actual interest rate method.
（3）Recognition and measurement of financial assets derecognized
Financial assets are derecognized when: i) the contractual rights to receive the cash flows from the financial assets have
expired; or ii) all substantial risks and rewards of ownership of the financial assets have been transferred; or iii) the control
over the financial asset has been waived even if the Group does not transfer or retain nearly all of the risks and rewards
relating to the ownership of a financial asset.
On derecognition of a financial asset, the difference between the carrying amount and the aggregate of consideration
received and the accumulative amount of changes of fair value originally recorded in the owner’s equity is recognised in
the income statement.
（4）Determined conditions of financial liability termination
The financial liability obligations have been all or part of removed, then to confirm that the termination of the
financial liability or part of it.
Enterprise will be used to pay the assets of the financial liability to an institution or the establishment of a trust, repay
debts present obligations still exists, shall not be stopped to confirm that the financial liability, also can't stop
recognizing turn out assets.
Enterprise (debtor) between the obligee and the signed an agreement to undertake to replace a new financial liabilities
existing financial liabilities, and new financial debts and the existing financial liabilities in the different of the terms of
the contract shall be terminated the confirm the existing financial liabilities, and confirmed that the new financial
liability.
Enterprise of existing financial liabilities of all or part of the identical terms to make a substantial modification,
confirm the existing financial liabilities shall be terminated or in part, at the same time will amend the terms of
financial liability for a new financial liability.
（5）Fair value measurment of financial assets and liabilities
a) If the market for a fiancial instrument is active, an entity establishes fair value by using the quoted price in the active
market. In the active market, the Group meausres the fair value of its holding financial assets and contingent financial
liabilities by using the current quoted price; the Group measures the fair value of its contingent financial assets and
holding financial liabilties by using the curent quoted price. If there are no current quoted prices for the financial assets
and liabilties, and no significant change in the economic environment after the settlement date, the quoted prices of the
recent transactions should be used to measure the fair value of the financial assets and liabilties.
b) If the market for a financial instrument is not active, an entity establishes fair value by using a valuation technique.
Valuation techniques include using recent arm’s length market transactions between knowledgeable, willing parties, if
available, reference to the current fair value of another instrument that is substantially the same, discounted cash flow
analysis and option pricing models.
（6）Impairment of financial assets (exclude A/R)
The Group assesses the carrying amount of financial assets other than financial assets at fair value through profit or loss at
each balance sheet date. If there is objective evidence that the financial asset is impaired, the Group shall determine the
amount of any impairment loss accounts.
If an impairment loss on a financial asset carried at amortized cost has been incurred, the amount of loss is measured at the
difference between the asset’s carrying amount and the present value of estimated future cash flows (excluding future
credit losses that have not been incurred). If there is objective evidence that the value of the financial asset recovered and
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Wafangdian Bearing Company Ltd. Midyear Report of 2012
the recovery can be related objectively to an event occurring after the impairment was recognized, the previously
recognized impairment loss is reversed and the amount of reversal is recognized in income statement.
If objective evidence shows that impairment for available-for-sale financial assets will occur,the cumulative loss arising
from the decline in fair value that had been recognized directly in equity is removed from equity and recognized as
impairment loss. For an available for sale debt instrument, if there is objective evidence that the value of the financial
asset recovered and the recovery can be related objectively to an event occurring after the impairment was recognized, the
previously recognized impairment loss is reversed and the amount of reversal is recognized in income statement. For an
available for sale equity instrument, if there is objective evidence that the value recovered and the recovery can be
objectively related to an event occurring after the impairment loss recognized, the previously recognized impairment loss
is reversed and directly recognized in equity.
4.10 Recognition standard and calculate method for bad debts of receivables provision
The Group shall calculate the full provision for bad debts for the following receivables: debtor has been log-out,
bankruptcy, minus net asset, significant poor cash flow and significant nature disaster leads to discontinue production and
the debtors could not pay for the debts within the foreseeable time . Other solid evidences indicates that the receivables
cound not be paid or be of a slim chance.
The allowance method is applied to the potential loss of bad debt. The Group should make the impairment test separately
or in combination and accure the bad debt provisions which shall be recorded into current profit or loss at the end of the
period. If there is defined evidence for the receivables not to or not likely to be received, which shall be recognized as the
loss of bad debt and write off the accrued bad debts provisions after going through the approval procedure of the Group.
(1) Individually significant amounts of accounts receivable accrued bad debt provision as per portfolio
The receivables with more than RMB 3 million
Judgment basis or amount standards of
individual amount shall be recognized as the significant
individually significant amounts
receivables;
The accruing method of the receivables with The bad debt provisions shall be accrued based on the
individually significant amounts difference between current value of future cash flow and
the carrying amounts.
（2）Accounts receivable accrued bad debt provision by portfolio
The accrual method for
The basis of portfolio bad debt provision by Ground
portfolio
Use the accounting aging of the receivables as the
accounting aging credit risk characteristics to classify the portfolio.
Accounting aging
analysis method Accrue the bad debt provision by accounting aging
analysis method
Use the amount characteristics of the receivables , if the
transaction party is related parties characteristics need
Related parties Other method
to classify the portfolio. Accrue the bad debt provision
by individual identification method
Use the amount characteristics of the receivables, the
credit of transaction party, the nature of the amounts
Risk-free Other method and the safeguard mechanism of transaction as
characteristics to classify the portfolio. Accrue the bad
debt provision by individual identification method
In portfolio, using the accounting aging of the receivables as caculating bad debts provision
√ Applicable □ Inapplicable
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Wafangdian Bearing Company Ltd. Midyear Report of 2012
Accounting aging Accrual percentage of the receivables (%) Accrual percentage of other receivables (%)
Within 1 year 1% 1%
1-2 years 5% 5%
2-3 years 20% 20%
Over 3 years 50% 50%
3－4 years 50% 50%
4－5 years 50% 50%
Over 5 years 50% 50%
The other method is applied to accrualing of bad debts provision:
√ Applicable □ Inapplicable
Name Explanation
Related parties Accrue the bad debt provision by individual identification method
Risk-free Accrue the bad debt provision by individual identification method
（3）Individually insignificant amount accounts receivable but accrued bad debt provision as per portfolio
Accrual reason: The individual amount is not significant, but the accrued bad debt provision on the basis of portfolio can
not reflect its risk characteristic
Accrual method :The bad debt provisions should be accrued based on the difference between current value of future cash
flow and the carrying amount.
4.11 Inventories
（1） Classification of inventory: Inventories are classified as raw material, wrappage, low-valuable consumable,
working-in-progress, and finished goods etc.
（2）Pricing of inventories received and sent out:
□first-in first-out method (FIFO) √Weighted average method □Individual determination method □Other
（3）Inventory net realizable value determination basis and inventory depreciation provision method
For the finished goods, working in progress and raw material held for sale etc which shall be sold directly, the net
realizable value should be confirmed at the estimated selling price less estimated selling expenses and related tax and
expenses. The raw material held for production, its realizable value should be confirmed at the estimated selling price of
finished goods less estimated cost of completion, estimated selling expenses and related tax. The net realizable value of
inventories held for execution of sale contracts or labor contracts shall be calculated based on the contract price. If the
quantities of inventories in the Group are more than quantities if inventories subscribed in the sales contracts, the net
realizable value of the excessive part of the inventories should be calculated based on the general selling price.
At the balance sheet date inventory should be measured at the lower of the cost and net realizable value. For the
inventories which are damaged, fully or partly obsoleted and selling price below cost, the Group should calculate the
provision for impairment of inventories according to the estimated nonrecoverable part of cost. Finished goods and a large
amount raw materials should be calculated provision for impairment based on the difference of the cost exceed the
realizable value of single item. For raw and accessorial materials with a large quantities and lower unit price should be
calculated provison for impairment according to classify of inventory.
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Wafangdian Bearing Company Ltd. Midyear Report of 2012
（4）Inventories processed system
√perpetual inventory system □Regular inventory system □ Other
（5）Low-valued consumables and packaging amortize method
Low-valued consumables: amortize at one time
Packaging: amortize at one time
4.12 Long-term equity investment
（1）The initial investment cost is determined
The initial cost of long term equity investments formed in the merger of enterprise under the same control shall be
recognized at the share of the carry amounts of equity of the merged enterprise. The initial cost of long term equity
investments acquired in the merger of enterprise under the different control shall be recognized at fair value of the assets
paid, liabilities risen or charged, and equity securities issued.
Besides the long-term equity investments acquired by the merger of enterprises, the initial cost of a long-term equity
investment obtained by other means shall be ascertained in accordance with the provisions as follows:
(1) The initial cost of a long-term equity investment obtained by making payment in cash shall be the purchase cost which
is actually paid. The initial cost consists of the expenses directly relevant to the obtaining of the long-term equity
investment, taxes and other necessary expenses.
(2) The initial cost of a long-term equity investment obtained on the basis of issuing equity securities shall be the fair
value of the equity securities issued.
(3) The initial cost of a long-term equity investment of an investor shall be the value stated in the investment contract or
agreement except the unfair value stated in the contract or agreement.
(4) The initial cost of a long-term investment obtained by the exchange of non-monetary assets and the initial cost of a
long-term equity investment obtained by debts restructuring shall be ascertained in accordance with related Accounting
Standards for Enterprises.
（2）A follow-up measurement and profit and loss confirmation
For the long-term equity investment in subsidiaries of the Group shall be measured in accordance with the cost method,
and shall be adjusted when preparing consolidated financial statements in accordance with equity method. For the
long-term equity investment of joint venture shall be measured in accordance with equity method.
For the long-term equity investment of the investing enterprise that does not do joint control or does not have significant
influences on the invested entity, and has no offer in the active market and its fair value cannot be reliably measured
should be measured in accordance with cost method. For the long-term equity investment of the investing enterprise that
does not do joint control or does not have significant influences on the invested entity, and has offer in the active market
and its fair value can be reliably measured should be measured as the assets available for sale.
（3）Bsis of the invested entity with a common control, great impact on
Joint control refers to the control over an economic activity in accordance with contract. Any party of joint venture can not
separately control the business activity of joint venture. The decision related to principal operating activities need
unanimous consent from any party
Significant influence refers to the power to participate in making decisions on the financial and operating policies of
investee, but not to control or do joint control together with other parties over the formulation of these policies. Significant
influence confirm according to the Group holds the over 20% (including 20%) but lower than 50% voteing shares. Unless
there is evidence which indicate the Group can not participate in the decision of production and operating under the
conditions above.
（4）Depreciation measure method and depreciation provision calculation method
The long-term equity investment exist the impairment signs, which should be recognized as recoverable amount.
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Wafangdian Bearing Company Ltd. Midyear Report of 2012
The recoverable amount shall be determined by the higher one, which between the assets of the fair value of the asset
minus the disposal expenses and the net amount of the assets of the current value of the expected future cash flow.
Assets of the fair value of the asset minus the disposal expenses and the net amount of the assets of the current value of
the expected future cash flow, as long as there is a more than the carrying value of the asset, it shows that no asset
impairment has occurred.
The recoverable amount of the measurement results show that the recoverable amount of the asset is lower than its
carrying value, the carrying value of the asset shall be reduced to the recoverable amount, the amount of writedowns
confirm for the loss of asset impairment, and shall be recorded into the profits and losses of the current period, and the
corresponding provision for impairment of assets.
Loss of asset impairment once confirmed, in the future accounting period shall not return.
4.13 Fixed assets
（1）Recognition criteria of fixed assets
Fixed assets are defined as the tangible assets which are held for the purpose of producing goods, rendering services,
leasing or for operation & management, and have more than one year of useful life, and whose unit price is over
RMB2000.
（2）Fixed assets depreciation method
The Group withdraws depreciation for all fixed assets except for the fixed assets which had been fully depreciated and are
still being used. The Group withdraws depreciation by adopting straight-line method and depreciation rate of unit item on
monthly basis, and brings it cost or expenses in current period. Estimated net residual value rate is 3%, useful life,
depreciation rate as follows:
Category Useful life (years) net residual value rate(%) Annual depreciation rate (%)
Housing and Buildings 15-35 3% 2.77-6.47
Machinery equipments 10-15 3% 6.47-9.70
Electric equipments 4-8 3% 12.13-24.25
Transportation equipments 6 3% 16.17
Others equipments 7-18 3% 5.39-13.86
（3）Depreciation measure method and depreciation provision calculation method
The fixed assets exist the impairment signs, which should be recognized as recoverable amount.
The recoverable amount shall be determined by the higher one, which between the assets of the fair value of the asset
minus the disposal expenses and the net amount of the assets of the current value of the expected future cash flow.
Assets of the fair value of the asset minus the disposal expenses and the net amount of the assets of the current value of
the expected future cash flow, as long as there is a more than the carrying value of the asset, it shows that no asset
impairment has occurred.
The recoverable amount of the measurement results show that the recoverable amount of the asset is lower than its
carrying value, the carrying value of the asset shall be reduced to the recoverable amount, the amount of writedowns
confirm for the loss of asset impairment, and shall be recorded into the profits and losses of the current period, and the
corresponding provision for impairment of assets.
Loss of asset impairment once confirmed, in the future accounting period shall not return.
4.14 Construction in progress
（1）Classification
（2）Standard and time when the CIP transfer into fixed assets.
Since the construction in progress reached the expected usable situation, according to the project budget, cost or
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Wafangdian Bearing Company Ltd. Midyear Report of 2012
engineering cost, the estimated value of fixed assets carry forward, second month began to plan carry depreciation, to deal
with the final accounts of the completed project after formalities again to the original value of fixed assets difference
adjustment.
（3）Depreciation measure method and depreciation provision calculation method
The CIP exist the impairment signs, which should be recognized as recoverable amount.
The recoverable amount shall be determined by the higher one, which between the assets of the fair value of the asset
minus the disposal expenses and the net amount of the assets of the current value of the expected future cash flow.
Assets of the fair value of the asset minus the disposal expenses and the net amount of the assets of the current value of
the expected future cash flow, as long as there is a more than the carrying value of the asset, it shows that no asset
impairment has occurred.
The recoverable amount of the measurement results show that the recoverable amount of the asset is lower than its
carrying value, the carrying value of the asset shall be reduced to the recoverable amount, the amount of writedowns
confirm for the loss of asset impairment, and shall be recorded into the profits and losses of the current period, and the
corresponding provision for impairment of assets.
Loss of asset impairment once confirmed, in the future accounting period shall not return.
4.15. Borrowing costs
（1）Recognition principles on capitalisation of borrowing cost:
The Group should capitalizes the borrowing cost directly attributable to the acquisition, construction or production of a
qualifying asset and record borrowing cost into cost of related asset. The Group should recognize the other borrowing cost
as the current expense and charged it as profit and loss of current period. A qualifying asset refers to fixed asset,
investment property and inventory need be constructed for so long time to its intended use or sale.
（2）Duration of capitalisation of borrowing cost:
When expenditures and borrowing cost are being incurred, and activities that are necessary to put the asset available for
use or sale are in progress, the capitalisation of borrowing costs as part of the cost of a qualifying asset should commence.
(3)Duration of capitalization suspended
Capitalisation of borrowing costs should be suspended during extended periods in which active development is interrupted
and interruption period last for over 3 month. The borrowing cost incurred during the period should be recognized as
expenses and recorded into the profit and loss in the current period. When all the activities for bringing the asset to its
intended use or sale are completed, the capitalization of borrowing costs ceases, and the borrowing costs should be
recognized as an expense in the period incurred.
(4)Measurement of borrowing cost
As for specifically borrowed loans for the acquisition and construction or production of assets eligible for capitalization,
the to-be-capitalized amount of interests shall be determined as the difference of the actual cost incurred of the specially
borrowed loan at the present period minus the income of interests earned on the unused borrowing loans as a deposit in the
bank or as a temporary investment. Where a general borrowing is used for the acquisition and construction or production
of assets eligible for capitalization, the Group shall calculate and determine the to-be-capitalized amount of interests on
the general borrowing 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 at the weighted average interest rate of the general borrowing.
4.16. Intangible assets
（1）Measurement of intangible assets
The intangible assets of the Group refer to land use right, ERP system software. The cost of outsourcing intangible assets
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Wafangdian Bearing Company Ltd. Midyear Report of 2012
shall include the purchase price, relevant taxes and other necessary expenditures directly attributable to intangible assets.
The cost invested into intangible assets by investors shall be determined according to the stated value in the investment
contract or agreement, except for those of unfair value in the contract or agreement.
（2）Amortisation method and period
The Group shall amortise land use right on the basis of its useful life by adopting straight line method from the time of
acquiring. ERP system software and other intangible assets shall be amortised on the basis of shorter of estimated useful
life, stated beneficial year in the contract, and legal available year. The amortization amount should be recorded into the
cost or expense of relevant in the current period.
The Group shall check the estimated useful life and amortization method of intangible assets with limited useful life at the
end of each year, if any change has been made, it shall be adjusted. The Group shall check the estimated useful life of
intangible assets with uncertain useful life during the each accounting period. If there are evidences to prove the useful life
of intangible assets is limited, the Group shall estimate the useful life and amortize the intangible assets within estimated
useful life.
Name Useful life basis
land use right 50 Years Law regulation
ERP software 10 Years Contract regulation
Choose the shortest one among useful life, contract
Other 3 Years
regulation and law regulation
（3）Uncertain service life of intangible assets judgment basis
No definite contract or law the service life of intangible assets, and the comprehensive enterprise all aspects, through
the joint efforts, still do not reasonable to be certain that the intangible assets for economic benefits to the enterprise, the
time limit for just the intangible assets as uncertain service life of intangible assets.
（4）Intangible asstes impairment
The Intangible asstes exist the impairment signs, which should be recognized as recoverable amount.
The recoverable amount shall be determined by the higher one, which between the assets of the fair value of the asset
minus the disposal expenses and the net amount of the assets of the current value of the expected future cash flow.
Assets of the fair value of the asset minus the disposal expenses and the net amount of the assets of the current value of
the expected future cash flow, as long as there is a more than the carrying value of the asset, it shows that no asset
impairment has occurred.
The recoverable amount of the measurement results show that the recoverable amount of the asset is lower than its
carrying value, the carrying value of the asset shall be reduced to the recoverable amount, the amount of writedowns
confirm for the loss of asset impairment, and shall be recorded into the profits and losses of the current period, and the
corresponding provision for impairment of assets.
Loss of asset impairment once confirmed, in the future accounting period shall not return.
4.17. Long-term deferred expenses
Long-term deferred expenses of the Group refer to expenses which are paid and should be deferred over the future period.
The amortization period shall be more than one year (no including 1 year). The expenses should be amortized averagely
over the beneficial period. If the deferred expense can not take benefit for the future accounting period, the unamortized
balance of the deferred expenses should be transferred into the current profit or loss.
4.18. Contingent liabilities
The obligation pertinent to a contingency shall be recognized as an estimated debt when the following conditions are
satisfied simultaneously:
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Wafangdian Bearing Company Ltd. Midyear Report of 2012
(1) The 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; and
(3) The amount of the obligation can be measured reliably.
The estimated debts shall be initially measured in accordance with the best estimate of the necessary expenses for the
performance of the current obligation, and the Group shall take into full consideration of the risks, uncertainty, time value
of money, and other factors pertinent to the contingencies. If the time value of money is of great significance, the best
estimate amounts shall be determined after discounting the relevant future outflow of cash. The Group shall check the
book value of the estimated debts on the balance sheet date. If there is any exact evidence indicating that the book value
cannot really reflect the current best estimate amounts, the Group shall adjust the book value in accordance with the
current best estimate amounts.
4.19. Government grants
（1）Classification
1）Fund assets；2）Non-fund assets
（2）Accounting method
A government subsidy of the Group shall be recognized if the Group can meet the conditions for the government subsidy
and also can obtain the government subsidy. 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 (RMB 1).
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
shall be treated respectively in accordance with the indications as follows: (1) those subsidies used for compensating the
related future expenses or losses of the Group shall be recognized as deferred income and shall included in the current
profits and losses during the period when the relevant expenses are recognized; or (2) those subsidies used for
compensating the related expenses or losses incurred to the Group shall be directly included in the current profits and
losses.
4.20 Deferred tax assets and deferred tax liabilities
(1) Deferred tax assets
Deferred tax assets and deferred tax liability should be recognized at the differences (taxable temporary differences)
between the tax base of an asset or liability and its carrying amount. The Group shall recognize the deferred income tax
assets arising from a deductible temporary difference 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. At the balance sheet date, deferred
tax asset and deferred tax liability should be measured at applicable tax rate.
The Group shall recognize the deferred tax assets arising from a deductible temporary difference to the extent of the
amount of the taxable income which is most likely to obtain which can be deducted from the deductible temporary
difference. For the deferred tax assets which already have been recognized, where there is any evidence showing that the
Group is probably unable to acquire sufficient amount of taxable income tax in a future period to offset against the
deductible temporary difference, the book value of the deferred tax assets shall be deducted. Where it is likely to acquire
sufficient amount of taxable income tax, the amount deducted shall be reversed.
（2）Deferred tax liabilities
Deferred tax assets and deferred tax liability should be recognized at the differences (taxable temporary differences)
between the tax base of an asset or liability and its carrying amount. The Group shall recognize the deferred income tax
assets arising from a deductible temporary difference 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. At the balance sheet date, deferred
38
Wafangdian Bearing Company Ltd. Midyear Report of 2012
tax asset and deferred tax liability should be measured at applicable tax rate.
4.21. Operating Lease and financing lease
（1）accounting measurement of operating lease
The leases of the Group refer to operating lease.
The rents from operating leases shall be recorded by the lessee into 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.
（2）accounting measurement financing lease
□ Applicable √ inapplicable
5. Taxation
5.1. The main applicable tax and rate to the Group as follows:
Tax Tax base Tax rate
Value-added tax (VAT) Sales revenue or Purchase 17%
Consuming tax
Business tax Revenue from property lease 5%
City construction tax Value-added tax payables, business tax 7%
Enterprise income tax(EIT) Current period taxable profit 15%,25%
Real estate tax 70% of cost of own property or revenue 1.2% or 12%
from leasing property
Land use tax Land using right area RMB 6 per square meter
Education surcharge Value-added tax payables, business tax 3%
The enterprise income tax rate of Liaoyang Bearing (the company’s subsidiary) is 25%.
The enterprise income tax rate of Dalian Electrical Equipment (the company’s subsidiary) is 25%.
5.2. Tax preference and approval
The Company obtained the qualification of high and new technology enterprises on 14 Oct 2011.The Certificate number is
GR201121200028,and the period of validity is three years. According to the provisions of the tax law the Company can
enjoy the preferential tax policy of enterprise income tax rate of 15% in three years (including 2011) .
6. Business combination and consolidated financial statements
6.1. General situation of Subsidiaries
（1）Subsidiaries founded through the establishment or investments
Unit： Yuan
39
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Actual
investment
Company Registere Nature of Registered Business Holdin Voting Consolid
Company type amount at
name d address operation capital scope the end of g % % ation
year
No.61,
Production
Weiguo Production and
and sales of
road, Baita sales of bearing
Liaoyang Bearing Limited bearing and 19,350,000 17,337,259.95 100% 100% Y
district and machinery
machinery
Liaoyang manufacturing
manufacturing
city
No.12,
Shisanli Production
yongsheng and sales of Planning to
Dalian Electrical
Limited street, bearing and 10,000,000 develope 45,478,956.37 100% 100% Y
Equipment
free trade machinery project
zone Dalian manufacturing
city
7 Notes to consolidated financial statements
7.1 Cash and cash in bank
Unit: Yuan
2012.06.30 2012.01.01
Items Original currency Exchan Amount Original Exchange Amount
ge rate (RMB) currency rate (RMB)
Cash on hand -- -- 311,328.15 -- -- 328,678.6
RMB -- -- 311,328.15 -- -- 328,678.6
Cash in bank -- -- 92,334,597 -- -- 61,333,040.65
RMB -- -- 78,482,838.24 -- -- 57,150,212.26
USD 2,190,036.01 6.3249 13,851,758.76 663,846.18 6.3009 4,182,828.39
EUR
Other cash -- -- 30,892,673.14 -- -- 40,607,035.09
RMB -- -- 30,892,673.14 -- -- 40,607,035.09
Total -- -- 123,538,598.29 -- -- 102,268,754.34
7.2 Notes receivable
(1) Category of notes receivable
Unit: Yuan
40
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Items 2012.06.30 2012.01.01
Bank acceptance notes 210,089,816.49 133,575,438.81
Commercial acceptance notes 32,723,431.76 938,946.57
Total 242,813,248.25 134,514,385.38
(2) Notes receivable endorsed to other parties but not mature at the end of year
Unit: Yuan
Note issuer Issuing date Maturity Amount Note
Bo fang textile Limited
2012-02-21 2012-08-21 7,000,000
company
Nanfang Changjiang
vechile company 2012-05-16 2012-11-16 5,500,000
changzhou branch
Qiqihaer railway
2012-2-22 2012-08-21 5,000,000
equipment company
Tangshan railway
2012-04-24 2012-10-24 4,863,281.9
company
Haerbin raileay
2012-03-26 2012-09-19 4,000,000
equipment company
Amount -- -- 26,363,281.9 --
7.3 Accounts receivable
(1) Category of accounts receivable
Unit: Yuan
2012.06.30 2012.01.01
Provision for bad and Gross carrying Provision for bad and
Gross carrying amount
doubtful debts amount doubtful debts
Items
Percentage Percentage Percentage Percentage
Amount Amount Amount Amount
(%) (%) (%) (%)
Accounts receivable with
individual significant
3,910,00 3,910,00
amount and identification 3,910,007.43 0.37% 100% 0.39% 3,910,007.43 100%
7.43 7.43
separately bad debt
provision
Accounts receivable accrued bad debt provision by portfolio
Accounting aging 1,036,982,56 35,775,166. 946,195,50 36,092,616.3
96.64% 3.45% 94.62% 3.81%
0.53 64 4.88 2
portfolio
20,312,554.3 38,122,177
Related parties portfolio 1.89% 0 0% 3.81% 0 0%
2 .56
Risk-free portfolio
1,057,295,11 35,775,166. 984,317,68 36,092,616.3
Subtotal of portfolio 98.53% 3.38% 98.43% 3.67%
4.85 64 2.44 2
Accounts receivable with
11,813,753.9 11,813,753. 11,813,753 11,813,753.9
individual insignificant 1.1% 100% 1.18% 100%
4 94 .94 4
amount and identification
41
Wafangdian Bearing Company Ltd. Midyear Report of 2012
separately bad debt
provision
1,073,018,87 51,498,928. 1,000,041, 51,816,377.6
Total -- -- -- --
6.22 01 443.81 9
Explanation:
1） Accounts receivable with individual significant amount and identification separately bad debt provision；
2） Accounts receivable accrued bad debt provision by portfolio with accounting aging；
3） Accounts receivable with individual insignificant amount and identification separately bad debt provision
Accounts receivable with individual significant amount and identification separately bad debt provision at the ending
balance:
√ Applicable □ inapplicable
Unit: Yuan
Provision for bad Provision rate Reasons for
Company name Booking balance
debts (%) provision
Baoding North China Machine & A/R with over 5
3,910,007.43 3,910,007.43 100% years aging, unlikely
Electronic Equipment Ltd Co. to be collected
Total 3,910,007.43 3,910,007.43 --
Accounts receivable accrued the bad debt provisions under accounting aging analysis method
√ Applicable □ inapplicable
Unit: Yuan
2012.06.30 2012.01.01
Booking balance Booking balance
Aging Percentage Provision for bad Percentage Provision for bad
Amount debts Amount debts
(%) (%)
Within 1 year
Incl: -- -- -- -- -- --
Within 1 year 917,883,864.44 88.52% 9,178,838.64 812,580,398.61 85.88% 8,125,803.98
Subtotal 917,883,864.44 88.52% 9,178,838.64 812,580,398.61 85.88% 8,125,803.98
1 to 2 years 68,889,954.96 6.64% 3,444,497.75 82,021,197.63 8.67% 4,101,059.89
2 to 3 years 6,508,467.72 0.63% 1,301,693.54 6,437,339.6 0.68% 1,287,467.92
Over 3 years 43,700,273.41 4.21% 21,850,136.71 45,156,569.04 4.77% 22,578,284.53
3 to 4 years 30,590,191.39 2.95% 15,295,095.7 31,609,598.33 3.34% 15,804,799.17
4 to 5 years 8,740,054.682 0.84% 4,370,027.342 9,031,313.808 0.95% 4,515,656.906
Over 5 years 4,370,027.341 0.42% 2,185,013.671 4,515,656.904 0.48% 2,257,828.453
Total 1,036,982,560.53 -- 35,775,166.64 946,195,504.88 -- 36,092,616.32
By portfolio, accounts receivable accrued the bad debt provisions under other method
√ Applicable □ inapplicable
Unit: Yuan
Name Booking balance Provision for bad debts
Related parties portfolio 20,312,554.32 0
42
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Risk-free portfolio
Amount 20,312,554.32 0
Individually insignificant amount accounts receivable but accrued bad debt provision separately at the end of 30 June,
2012
√ Applicable □ inapplicable
Unit: Yuan
Proportion
Company name Booking balance Provision for bad debts Reasons for provision
(%)
Shenyang Sewerage A/R with over 5 years aging,
2,706,703.13 2,706,703.13 100%
Equipment Co.,Ltd unlikely to be collected
A/R with over 3 years aging,
Shen Yang General
2,452,138.58 2,452,138.58 100% forms a book difference
Bearing Co.,Ltd
between both sides
A/R with over 3 years aging,
Tiefa coal sector Group
2,352,760.15 2,352,760.15 100% forms a book difference
Company
between both sides
A/R with over 3 years aging
Shuangyashan Mining
1,368,257.55 1,368,257.55 100% forms a book difference.
industry Group Company
between both sides
A/R with over 3 years aging
Chongqing Sailimeng
650,758.88 650,758.88 100% forms a book difference.
electrical machine LLC
between both sides
A/R with over 3 years aging
Qingdao Qingte Zhongli
590,898.99 590,898.99 100% forms a book difference
axle Co.,Ltd
between both sides.
Other sporadic accounts A/R with over 5 years aging,
1,692,236.66 1,692,236.66 100%
receivable unlikely to be collected
Total 11,813,753.94 11,813,753.94 100% --
（2）Accounts receivable due from shareholders who hold 5% or more of the voting rights of the Company
√ Applicable □ inapplicable
Unit: Yuan
2012.06.30 2012.01.01
Company name Amount Provision for bad Amount Provision for bad
debt debt
Wazhou Group 7,523,401.47 0 25,365,740.94 0
43
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Total 7,523,401.47 0 25,365,740.94 0
（3）Accounts receivable due from the five biggest debtors of the Group are as follows:
Unit: Yuan
Relationship with the Percentage
Company name Amount Aging
Company in the total AR(%)
China Railway Materials
Unrelated party 54,672,480.56 Within 1 year 5.1%
Company
Hudong vehicle section
of Daqin railway Stock Unrelated party 26,717,017.96 Within 1 year 2.49%
Co.,Ltd
Dalian Huarui Company
Unrelated party 24,909,219.41 Within 1 year 2.32%
Limited
Xi’an fashite auto
Unrelated party 18,131,040.86 Within 1 year 1.69%
transmion company
Dalian Lohui commercial
Unrelated party 17,394,507.47 Within 1 year 1.62%
company
Amount -- 141,824,266.26 -- 13.22%
（4）Accounts receivable due from related parties
Unit: Yuan
Relationship with the Percentage in the total
Company name Amount
Company accounts receivable(%)
Wazhou Group Biggest shareholder 7,523,401.47 0.7%
Wafangdian precision forging Other companies controlled by
6,267,154.37 0.58%
company the same parent company
Wazhou Group Precision Other companies controlled by
6,521,998.48 0.61%
special Bearing Co., Ltd the same parent company
Total -- 20,312,554.32 1.89%
7.4 Other receivables
(1) The categories of other receivable
Unit: Yuan
2012.06.30 2012.01.01
Gross carrying Provision for bad Gross carrying Provision for bad and
Items amount and doubtful debts amount doubtful debts
Amount Percenta Amount Percenta Amount Percentag Amount Percenta
ge ge e ge
44
Wafangdian Bearing Company Ltd. Midyear Report of 2012
(%) (%) (%) (%)
The receivables with
individual significant
amount and
0 0 0 0
identification
separately bad debt
provision
Other receivables accrued bad debt provision by portfolio
Accounting aging 19,846,785.1 17,508,565.0
96.69% 3,533,925.62 17.81% 91.85% 3,533,925.62 20.18%
6 7
portfolio
Related parties
0 0% 0 0% 0 0% 0 0%
portfolio
Risk-free portfolio 680,018.19 3.31% 0 0% 1,553,635.42 8.15% 0 0%
20,526,803.3 19,062,200.4
Subtotal of portfolio 100% 3,533,925.62 17.22% 100% 3,533,925.62 18.54%
5 9
Other receivables
with individual
insignificant amount
0 0 0 0
and identification
separately bad debt
provision
Total 20,526,803.3
-- 3,533,925.62 --
19,062,200.4
-- 3,533,925.62 --
5 9
Explanation:
1) Other accounts receivable with individual significant amount and identification separately bad debt provision；
2) Other accounts receivable accrued bad debt provision by portfolio with accounting aging；
3) Other accounts receivable with individual insignificant amount and identification separately bad debt provision
Accounts receivable accrued the bad debt provisions under accounting aging analysis method
√ Applicable □ inapplicable
Unit: Yuan
2012.06.30 2012.01.01
Booking balance Booking balance
Aging Amount Perce Provision for Amount Perce Provision for bad
ntage bad debts ntage debts
(%) (%)
Within 1 year
Incl:
Within 1 year 12,424,811.9 62.6% 124,248.12 10,059,941.26 57.46% 100,599.41
Subtotal 12,424,811.9 62.6% 124,248.12 10,059,941.26 57.46% 100,599.41
1 to 2 years 535,550.85 2.71% 26,777.54 518,270.58 2.96% 25,913.53
45
Wafangdian Bearing Company Ltd. Midyear Report of 2012
2 to 3 years 201,037.5 1.01% 40,207.5 192,546.46 1.1% 38,509.29
Over 3 years 6,685,384.91 33.68% 3,342,692.46 6,737,806.77 38.48% 3,368,903.39
3 to 4 years 4,679,769.437 23.58% 2,339,884.722 4,716,464.739 26.94% 2,358,232.373
4 to 5 years 1,337,076.982 6.74% 668,538.492 1,347,561.354 7.7% 673,780.678
Over 5 years 668,538.491 3.37% 334,269.246 673,780.677 3.85% 336,890.339
Total 19,846,785.16 -- 3,533,925.62 17,508,565.07 -- 3,533,925.62
By portfolio, accounts receivable accrued the bad debt provisions under other method
√ Applicable □ inapplicable
Unit: Yuan
Name Booking balance Provision for bad debts
Related parties portfolio 0 0
Risk-free portfolio 680,018.19 0
Amount 680,018.19 0
Individually insignificant amount accounts receivable but accrued bad debt provision separately at the end of 30 June,
2012
□Applicable √ inapplicable
（2）Other receivables due from the five biggest debtors of the Group are as follows:
Unit: Yuan
Relationship with the % of the total OR
Company name Amount Aging
Company
Dalian Jinhua steel Unrelated party 800,000 Over 3 years 3.9%
material sales company
Dalian Steel company Unrelated party 736,160.12 Over 3 years 3.59%
Yingkou general use Unrelated party 547,402.41 1-2years 2.67%
bearing company
Baita xinghuo company Unrelated party 457,529.25 Over 3 years 2.23%
Shenyang electricity
Unrelated party 366,591.88 Over 3 years 1.79%
company
Total -- 2,907,683.66 -- 14.17%
7.5 Advances to suppliers
（1）The aging of advance to suppliers are analyzed below:
Unit: Yuan
2012.06.30 2012.01.01
Items
Amount Percentage(%) Amount Percentage(%)
Within 1 year 12,590,093.84 70.5% 46,097,537.36 87.44%
46
Wafangdian Bearing Company Ltd. Midyear Report of 2012
1 to 2 years 3,661,391.41 20.5% 4,567,917.29 8.67%
2 to 3 years 20,516.45 0.12% 52,493.34 0.1%
Over 3 years 1,585,917.02 8.88% 1,998,873.35 3.79%
Total 17,857,918.72 -- 52,716,821.34 --
（2）As at 30 June 2012, the five largest advances to supplies are set out below
Unit: Yuan
Relationship with the
Company name Amount Time Pending reason
Company
Daye Special Steel
Unrelated party 6,213,882.3 2012-5-10 Goods not yet reached
Company Limited
Fushun Special Steel
Unrelated party 2,407,922.57 2012-5-13 Goods not yet reached
Company Limited
Bengang panel Stock
Unrelated party 2,253,536.36 2012-6-5 Goods not yet reached
Co.,Ltd
Luoyang heavy steel
Unrelated party 1,917,700.3 2012-6-11 Goods not yet reached
factory
China railway material
Unrelated party 453,452.55 2012-5-9 Goods not yet reached
Tianjin company
Total Unrelated party 13,246,494.08 -- --
Explanation for advances to suppliers：They are mass material supplier, and the product are hot sales.
（3）Explanation for the amount for advances to suppliers: The material has not been received and settled in accounting.
7.6 Inventories
（1）Categories of inventories
Unit: Yuan
2012.06.30 2012.01.01
Item Booking Provision for Net book Booking Provision for Net book
balance decline value balance decline value
Raw materials 157,772,316.27 2,658,311.39 155,114,004.88 138,653,860.31 2,658,311.39 135,995,548.92
Working in progress 162,698,056.72 602,496.86 162,095,559.86 210,631,984.02 602,496.86 210,029,487.16
Finished goods 850,709,503.52 56,358,265.81 794,351,237.71 906,387,958.99 56,358,265.81 850,029,693.18
Turnover material 548,421.12 0 548,421.12 484,241.17 0 484,241.17
Consumable material
Total 1,171,728,297.63 59,619,074.06 1,112,109,223.57 1,256,158,044.49 59,619,074.06 1,196,538,970.43
47
Wafangdian Bearing Company Ltd. Midyear Report of 2012
（2）Provision for decline in the value of inventories
Unit: Yuan
Decrease
Booking balance at Booking balance at
Item the period-begining
Increase Others the period-ending
Reverse transferred
Raw materials 2,658,311.39 2,658,311.39
Working in progress 602,496.86 602,496.86
Finished goods 56,358,265.81 56,358,265.81
Turnover material 0 0
Consumable material
Total 59,619,074.06 0 0 0 59,619,074.06
Explanation for inventories: raw material, warppage, low-value consumable, working in process an finished goods.
7.7 Other current assets
Unit: Yuan
Item 2012.06.30 2012.01.01
Rental 368,893.69 255,384.29
Income tax 2,493,525.43 5,473,840.19
Total 2,862,419.12 5,729,224.48
7.8 Investment in Joint Venter
Unit: Yuan
Total Total
Total Net
Total net sales
Enterp Registe Legal Registe liabiliti profits
Business Holdin Voting assets assets revenue
Investee rise red represe red as at es as at in the
nature g % % June 30 as at in the
nature address ntative capital June 30 H1 of
2012 June 30 H1 of
2012 2012
2012 2012
Jonit venter
No.1, Wang Manufactu
Phrase Lushun re and
Chinese
1, sales of
-foreign
Dalian SKF Wazhou Gongji ball-surfac 140,000 23,475. 4,517.8 18,957. 9,802.2
equity 49% 49% 609.18
Bearings Co., Ltd. Street, e rolling ,000 63 1 82 7
joint
Wafang bearing
venture
dian
North
7.9 Long-term equity investments
48
Wafangdian Bearing Company Ltd. Midyear Report of 2012
（1）Details
Unit:Yuan
Difference
between
Original Increase/decre depreciation in
Investee Method 2012.01.01 2012.06.30 Holding % Voting % hodling and depreciation dividend
Amounts ase the period
voting
percentage
Shanghai ME
machine-electri
Cost method 2,000,000 2,000,000 0 2,000,000 4.76% 4.76% 0 0
cal equipment
chain Ltd.
Dalian SKF
Wazhou
Equity method 68,600,000 90,079,035.89 2,985,002.73 93,064,038.62 49% 49% 0 0
Bearings Co.,
Ltd.
Shanghai
Zhenxin
Wazhou
Equity method 400,000 410,855.12 -410,855.12 0 40% 40% 0 0
Machinery and
Electricity Co.,
Ltd.
Total -- 71,000,000 92,489,891.01 2,574,147.61 95,064,038.62 -- -- -- 0 0 0
49
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Explanation：
Shanghai Zhenxin Wazhou Machinery and Electricity Co., Ltd (the"Shanghai Zhenxin") is out of business
temporarily due to its poor operating performance and leasehold has expired. Since 2010, it began to close business, and
the liquidation is over. The Company has taken back RMB 400 thousand at the balance sheet date. Becasue the investment
10,855.12 Yuan according to equity method has taken back 3,916.91 Yuan, the difference 6,938.21 Yuan has been
calculated into the investment loss in the period.
7.10 Fixed assets
（1）Details
Unit: Yuan
Booking balnce as
Booking balnce as
Items Increase Decrease at the 30 June
at the 1 Jan 2012
2012
Cost 1,431,530,695.72 42,232,963.77 19,205,611.79 1,454,558,047.7
Incl: Buildings 317,596,891.85 2,356,501.14 2,332,191.14 317,621,201.85
Machinery 767,351,847.19 37,324,958.96 14,820,004.46 789,856,801.69
Transportation equipment 20,426,769.01 1,568,244.85 1,854,232.49 20,140,781.37
Electrical equipment 29,895,241.5 679,052.32 18,643 30,555,650.82
Others 296,259,946.17 304,206.5 180,540.7 296,383,611.97
Booking balnce as
Booking balnce as
-- Increase caculate Decrease at the 30 June
at the 1 Jan 2012
2012
Accumulated deprecation 846,581,051.8 50,001,670.3 0 15,280,134.28 881,302,587.82
Incl: Buildings 154,942,793.68 5,590,000.64 784,814.79 159,747,979.53
Machinery 460,458,736.38 32,547,390.82 12,536,783.7 480,469,343.5
Transportation equipment 14,529,418.04 977,201.29 1,795,479.74 13,711,139.59
Electrical equipment 25,693,265.62 870,075.83 17,363.22 26,545,978.23
Others 190,956,838.08 10,017,001.72 145,692.83 200,828,146.97
Booking balance Booking balance
-- as at the 1 Jan -- as at the 30 June
2012 2012
Net book value 584,949,643.92 -- 573,255,459.88
Incl: Buildings 162,654,098.17 -- 157,873,222.32
Machinery 306,893,110.81 -- 309,387,458.19
Transportation equipment 5,897,350.97 -- 6,429,641.78
Electrical equipment 4,201,975.88 -- 4,009,672.59
Others 105,303,108.09 -- 95,555,465
Provision for impairment 3,484,939.66 -- 3,456,778.66
50
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Inc: Buildings 0 -- 0
Machinery 3,283,780.15 -- 3,255,619.15
Transportation equipment 200,000 -- 200,000
Electrical equipment 0 -- 0
Others 1,159.51 -- 1,159.51
Booking value 581,464,704.26 -- 569,798,681.22
Incl: Buildings 162,654,098.17 -- 157,873,222.32
Machinery 303,609,330.66 -- 306,131,839.04
Transportation equipment 5,697,350.97 -- 6,229,641.78
Electrical equipment 4,201,975.88 -- 4,009,672.59
Others 105,301,948.58 -- 95,554,305.49
In the period, the increase includes the assets which were transferred from construction in progress amounted to
RMB25,614,951, and in the increase of accumulated depreciation, the amount accrued for current period was RMB
39,206,790.74.
（2）Fixed assets leisured temporary
Unit: Yuan
Accumulated Provision for
Items Cost Booking value remarks
deprecation impairment
Incl: Buildings 9,151,839 6,425,627.57 0 2,726,211.43
Machinery 30,324,495.15 24,925,089.51 3,212,255.32 2,187,150.32
Transportation
419,596.42 329,181.67 0 90,414.75
equipment
420,565.56 402,955.62 1,009.51 16,600.43
（3）Fixed assets of renting out under operating lease
√ Appilcable □ Inapplicable
Unit: Yuan
Items Book value
Buildings 40,210,815.34
Machinery
Transportation equipment
7.11 Construction in progress
51
Wafangdian Bearing Company Ltd. Midyear Report of 2012
（1）
Unit: Yuan
2012.06.30 2012.01.01
Items Book Provision for Provision for
Book value Book balance Book value
balance impairment impairment
Truck bearing factory
23,359,087.6 23,359,087.6 19,117,461.62 19,117,461.62
construction
Truck bearing factory
16,029,166.59 16,029,166.59 13,427,695 13,427,695
electirity installment
Truck taper bearing reform 44,949,993.67 44,949,993.67 32,264,417.46 32,264,417.46
Auto colunmn bearing reform 10,181,529.52 10,181,529.52 9,883,798.23 9,883,798.23
Medium sized deep groove
43,897,784.29 43,897,784.29 44,552,487.1 44,552,487.1
ball bearing product line
Special-large factory reform 3,721,026.15 3,721,026.15 3,564,271.89 3,564,271.89
Dalian industry park project 14,741,838.68 14,741,838.68 5,784,723.29 5,784,723.29
Improvement of
2,921,193.17 2,921,193.17 1,702,070.07 1,702,070.07
seven-finished products
precision roller reform 4,728,484.78 4,728,484.78 26,253,182 26,253,182
Improvement of plant 10,254,374.59 10,254,374.59 8,968,944.08 8,968,944.08
Improvement of finished
10,125,944.03 10,125,944.03 9,834,744.03 9,834,744.03
goods storage
Carbonization line 14,016,114.99 14,016,114.99 14,016,114.99 14,016,114.99
Heat treatment product line 1,598,665.57 1,598,665.57 1,456,147.57 1,456,147.57
Grinding product line 13,501,558.83 13,501,558.83 16,848,631.43 16,848,631.43
Improvement of grinding
14,466,961.01 14,466,961.01 10,321,267.77 10,321,267.77
machine
Digital Boring machine 3,335,501.54 3,335,501.54 4,793,544.27 4,793,544.27
Crane Project 3,250,186.34 3,250,186.34 3,250,186.34 3,250,186.34
Computer Project 2,241,942.02 2,241,942.02 1,475,745.59 1,475,745.59
Improvement of exploration
803,190.72 803,190.72 654,858.57 654,858.57
machinery
Installation of super finish
1,675,291.99 1,675,291.99 1,141,642.9 1,141,642.9
machine
Assembling line 16,045,874.21 16,045,874.21 16,025,784.87 16,025,784.87
Forked truck 1,613,954.92 1,613,954.92 1,613,954.92 1,613,954.92
Instruments 741,366.81 741,366.81 674,896.65 674,896.65
M250Grinding Machine
130,730.53 130,730.53 130,730.53 130,730.53
Improvement
New plant of liaoning bearing 2,418 2,418 2,418 2,418
Others 18,515,051.07 18,515,051.07 14,221,306.88 14,221,306.88
Total 276,849,231.62 0 276,849,231.62 261,981,026.05 0 261,981,026.05
52
Wafangdian Bearing Company Ltd. Midyear Report of 2012
（2）Change in the significant construction in progress
单位： 元
Including:
Transfrerred % of Accumulated Accumulated Interest
Construction Period-beginni Construction Source of
Budget Increase into fixed Decrease investment capitalized capitalized capitalization Period-ending
name ng progress (%) funds
assets rate(%)
against budget interest interest in the
period
Medium sized raise money
deep groove
62,672,000 44,552,487.1 47,946,677.19 48,601,380 76.5% 76.5% 56,272.66 18,629.49 4.79% by self or 43,897,784.29
ball bearing
product line loan
Truck taper raise money
bearing 51,311,483 32,264,417.46 41,293,828.13 103,076.92 28,505,175 80.5% 80.5% 489,076.18 148,010.24 4.79% by self or 44,949,993.67
reform loan
raise money
precision
4,419,065 26,253,182 2,649,778.46 23,421,871.45 752,604.23 60% 60% 2,789,335.11 929,778.37 4.79% by self or 4,728,484.78
roller reform
loan
Truck bearing raise money
factory 31,886,787 19,117,461.62 8,282,305.98 4,040,680 26% 26% 279,006.2 76,916.24 4.79% by self or 23,359,087.6
construction loan
raise money
Grinding
44,635,500 16,848,631.43 4,610,827.4 7,957,900 10.3% 10.3% 440,646.87 15,973.47 4.79% by self or 13,501,558.83
product line
loan
raise money
Assembling
21,644,000 16,025,784.87 15,595,089.34 108,000 15,467,000 72.1% 72.1% 53,845.97 17,251.35 4.79% by self or 16,045,874.21
line
loan
raise money
Carbonization
14,922,000 14,016,114.99 22,181.9 7,036.72 4.79% by self or 14,016,114.99
line
loan
Truck bearing raise money
factory
16,714,940 13,427,695 2,601,471.59 15.6% 15.6% 194,724.11 52,780.45 4.79% by self or 16,029,166.59
electirity
installment loan
Improvement 20,381,500 10,321,267.77 8,589,493.24 4,443,800 42.1% 42.1% 36,746.78 11,264.27 4.79% raise money 14,466,961.01
53
Wafangdian Bearing Company Ltd. Midyear Report of 2012
of grinding by self or
machine loan
Auto colunmn raise money
bearing 18,804,498 9,883,798.23 7,847,731.29 7,550,000 41.7% 41.7% 138,006.74 33,525.49 4.79% by self or 10,181,529.52
reform loan
Improvement raise money
of finished 11,608,368.6 9,834,744.03 1,625,200 1,334,000 14% 14% 193,390.96 29,029.27 4.79% by self or 10,125,944.03
goods storage loan
raise money
Improvement
12,619,796 8,968,944.08 6,379,360 104,549.49 4,989,380 50.6% 50.6% 889,729.94 176,068.46 4.79% by self or 10,254,374.59
of plant
loan
DaLian raise money
Industry Plant 30,234,980 5,784,723.29 10,342,183.78 220,068.39 1,165,000 34.2% 34.2% 8,031,503.05 25,173.53 4.79% by self or 14,741,838.68
Poject loan
raise money
Digital Boring
15,803,000 4,793,544.27 563,857.27 2,021,900 3.6% 3.6% 510,044.97 11,090.32 4.79% by self or 3,335,501.54
machine
loan
raise money
Special-large
3,315,000 3,564,271.89 1,410,344 243,589.74 1,010,000 42.5% 42.5% 1,615.55 538.52 4.79% by self or 3,721,026.15
factory reform
loan
raise money
Crane Project 3,723,136 3,250,186.34 182,414.31 5,583.21 4.79% by self or 3,250,186.34
loan
238,907,254.3 159,738,147.6 127,838,819.2 246,605,426.8
Total 364,696,053.6 24,201,155.99 -- -- 14,308,541.3 1,558,649.4 -- --
7 7 3 2
54
Wafangdian Bearing Company Ltd. Midyear Report of 2012
7.12 Intangible assets
（1）Details
Unit: Yuan
Items 2012.01.01 Increase Decrease 2012.06.30
Cost 154,344,084.79 0 0 154,344,084.79
Land use right 148,782,429.5 148,782,429.5
ERP software 4,985,843.33 4,985,843.33
Others 575,811.96 575,811.96
Amortization 22,364,675.73 2,144,947.32 0 24,509,623.05
Land use right 18,875,135.79 1,859,757.72 20,734,893.51
ERP software 2,991,505.65 249,292.14 3,240,797.79
Others 498,034.29 35,897.46 533,931.75
Net book value 131,979,409.06 0 2,144,947.32 129,834,461.74
Land use right 129,907,293.71 1,859,757.72 128,047,535.99
ERP software 1,994,337.68 249,292.14 1,745,045.54
Others 77,777.67 35,897.46 41,880.21
Provision for impairment 0 0 0 0
Land use right
ERP software
Others
Book value 131,979,409.06 0 2,144,947.32 129,834,461.74
Land use right 129,907,293.71 1,859,757.72 128,047,535.99
ERP software 1,994,337.68 249,292.14 1,745,045.54
Others 77,777.67 35,897.46 41,880.21
Note: The increased accumulated amortization of this year is including normal amortization of intangible assets for RMB 2,144,947.32.
7.13 Long-term deferred and prepaid expenses
Unit: Yuan
Items 2012.01.01 Increase Amortization Other decrease 2012.06.30 Reason
Right to use
860,513.47 33,915.18 826,598.29
premise
Heat fee etc 8,991.53 8,991.53 0
Total 869,505 0 42,906.71 0 826,598.29 --
55
Wafangdian Bearing Company Ltd. Midyear Report of 2012
7.14 Deferred tax assets and deferred tax liabilities
(1) Recognized deferred tax assets and deferred tax liabilities
√ Applicable □ inapplicable
Unit: Yuan
Item 2012.06.30 2012.01.01
Deferred tax assets
Provision for impairment of assets 9,489,483.24 9,489,483.24
Total 9,489,483.24 9,489,483.24
Deferred tax liabilities
Unrealized intragroup loss 246,635.79 246,635.79
Total 246,635.79 246,635.79
7.15 Details of provision for impairment of assets
Unit: Yuan
Decrease
Items 2012.01.01 Increase 2012.06.30
Reversal Others transfer
Provision for bad debts 55,350,303.31 317,449.68 55,032,853.63
Provision for decline in value
59,619,074.06 0 0 0 59,619,074.06
of inventories
Provision for impairment of
0 0
long-term equity investments
Provision for impairment of
3,484,939.66 28,161 3,456,778.66
fixed assets
Provision for impairment of
0 0 0
construction in progress
Provision for impairment of
0 0 0
intangible assets
Other
Total 118,454,317.03 0 0 345,610.68 118,108,706.35
7.16 Short-term loan
（1）Category of short-term loan
Unit: Yuan
Loan category 2012.06.30 2012.01.01
Mortgage loan 13,590,235.14 13,590,235.14
Guarantee loan 90,000,000
Credit loan 550,000,000 510,000,000
Total 653,590,235.14 523,590,235.14
56
Wafangdian Bearing Company Ltd. Midyear Report of 2012
（2）Short-term loan due but not repaid
Unit: Yuan
Reasonofoutstandingon
Creditor Amount Interest rate Purpose Expected paymentdate
schedule
Industrial and
Transferredtoassets managemen
Commercial Bank of 13,590,235.14 5.31%Production Uncertainty
frombank
China Liaoyang Branch
Total 13,590,235.14 -- -- -- --
A Pursuant to the loan contract signed between Liaoyang Bearings and Liaoyang Zhanqian Branch, the Industrial and
Commercial Bank of China, for the one year current loan of RMB 13,590,235.14 with annual interest rate of 5.31% for the
period from 21 August 2001 to 16 August 2002. The borrowing has been transferred into the Great Wall Capital
Management Company due to overdue.
The above short-term loan due but not repaid are still overdue at the balance sheet date.
7.17 Notes payable
Unit: Yuan
Items 2012.06.30 2012.01.01
Commercial acceptance notes 0 0
Bank acceptance notes 195,714,142.09 94,100,000
Total 195,714,142.09 94,100,000
7.18 Accounts payable
（1）
Unit: Yuan
Items 2012.06.30 2012.01.01
Within 1 year 868,817,203 937,328,476.94
over 1 year 116,772,119.57 101,972,016.35
Total 985,589,322.57 1,039,300,493.29
（2）Accounts payable is due to shareholders holding over 5% (including 5%) of the Company’s shares at the end
of period.
□applicable √ inapplicable
Note: Accounts payable with age over 1 year arise mainly due to the fact that the accounts payable related to materials
purchase and construction project has not been paid in time.
7.19 Advances from customers
（1）
Unit: Yuan
Items 2012.06.30 2012.01.01
Within 1 year 38,751,138.66 44,267,968.08
57
Wafangdian Bearing Company Ltd. Midyear Report of 2012
over 1 year 3,489,322.91 6,139,927.57
Total 42,240,461.57 50,407,895.65
（2）Advances from customers is due to shareholders holding over 5% (including 5%) of the Company’s shares at
the end of period.
□applicable √ inapplicable
7.20 Employee benefits payable
Unit: Yuan
Items 2012.01.01 Increase Decrease 2012.06.30
Salary, bonus,
allowance and 3,839,463.02 90,227,259.13 93,209,155.47 857,566.68
subsidy
Employee welfare 0 9,713,333.19 9,713,333.19 0
Social insurance 10,588,126.47 31,014,738.91 31,637,649.32 9,965,216.06
Including: Medical
19,885.64 7,523,920.59 7,518,597.57 25,208.66
insurance
Basis pension 9,963,797.07 19,474,125.9 20,065,907.31 9,372,015.66
Unemployment
315,390.13 1,840,379.29 1,865,606.98 290,162.44
insurance
Compo insurance 219,758.7 1,412,103.3 1,419,423.29 212,438.71
69,294.93 764,209.83 768,114.17 65,390.59
Maternity insurance
Housing fund 3,040,791.86 5,128,631.4 5,236,088.8 2,933,334.46
Compensation for
cancellation of 0 725,515 725,515
labour relationship
Other 12,040,203.59 96,182.98 1,848,512.32 10,287,874.25
Labour union
expenditure &
12,040,203.59 96,182.98 1,848,512.32 10,287,874.25
employee education
expenditure
Total 29,508,584.94 136,905,660.61 142,370,254.1 24,043,991.45
The amount in employee benefits payable is behind in payment
Labour union expenditure & employee education expenditure is 1,848,512.32 Yuan; non-cash fund amount is 7,856,666.5 Yuan; termination
compensation is 725,515 Yuan.
The employee benefits payable allocated by month.
7.21 Taxes payable
Unit: Yuan
58
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Items 2012.06.30 2012.01.01
Value-added tax 15,229,637.04 90,995.2
Consumer tax
Business tax 181,705.12 281,249.63
Enterprise income tax
Individual income tax 70,047.44 851,553.59
City maintenance and construction tax 1,042,035.82 272,928.4
Real estate tax -58,891.1 28,600
Land use tax -78,052 39,280
Stamp tax 137,597.6 135,645.48
Education surcharge 744,823.76 189,416.97
River toll fee 91,811.24 2,373.89
Others 0 31,598.96
Total 17,360,714.92 1,923,642.12
7.22 Other payables
（1）
Unit: Yuan
Items 2012.06.30 2012.01.01
Within 1 year 70,834,734.6 67,402,130.71
Over 1 year 52,804,481.1 48,840,550.97
Total 123,639,215.7 116,242,681.68
（2）Other payables due to shareholders who hold more than 5% (including 5%) of the Group’s shares
√applicable □inapplicable
Unit: Yuan
Company name 2012.06.30 2012.01.01
Wazhou Group 29,796,527.28 25,923,909.17
Total 29,796,527.28 25,923,909.17
（3）Expalnation on the other payables with age over 1 year
The other payables with age over 1 year are mainly due to Wazhou Group，and accounts payable of the company’s
subsidiary—Liaoyang Bearing with Liaoyang Baolin Real Estate Development Co., Ltd.
（4）Significant other payables at the end of the period
Unit: Yuan
Item Amount Aging Nature or contents
32,500,000.00 Within1 year,1-2years Current account
Liaoyang Baolin Real Estate Development
59
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Co., Ltd.
29,796,527.28 1-3 years and above Current account
Wazhou Group
Shen Yang town and country Building 5,952,436.61 Construction fee
within 1 year
Engineering Company
Liaoyang Baotai Building Engineering 3,107,486.66 Construction fee
within 1 year
Company
Dalian Meishanglian international logistics 2,915,979.81 Current account
within 1 year
company
Total 74,272,430.36
7.23 Non-current liabilities due within one year
（1）
Unit: Yuan
Item 2012.06.30 2012.01.01
Long-term loan due within one year 8,000,000 138,000,000
Long-term security due within one year
Long-term payable account due within one year
Total 8,000,000 138,000,000
（2）Long-term loan due within one year
Unit: Yuan
Category 2012.06.30 2012.01.01
Mortage loan
Guarantee loan 8,000,000 138,000,000
Credir loan
Total 8,000,000 138,000,000
As at 30 June 2012, the five largest long-term loan due within 1 year are set out below
Unit: Yuan
2012.06.30 2012.01.01
Interest rate
Creditor Starting date Maturity Currency (%) Currency Currency
RMB amount RMB amount
amount amount
China
development 2007-9-7 2012-10-20 CNY 7.05% 8,000,000 48,000,000
bank
Amount -- -- -- -- -- 8,000,000 -- 48,000,000
7.24 Special payables
Unit: Yuan
Item 2012.01.01 Increase Decrease 2012.06.30 Note
Special pollution treatment 221,698.98 0 0 221,698.98
60
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Total 221,698.98 0 0 221,698.98 --
Note: Special pollution treatment is the environmental protection subsidy granted by Wafangdian Bureau of Finance and Wafangdian
Bureau of Environment Protection for the treatment of waste water pursuant to the circular No.[2004]217.
7.25 Other non-current liabilities
Unit: Yuan
Item 2012.06.30 2012.01.01
Improvement subsidy* 4,053,500 4,422,000
Compensation for plants moving** 44,619,891.2 45,972,009.12
Total 48,673,391.2 50,394,009.12
Note: The improvement subsidy is the railway transportation bearing technologic improvement subsidy granted by Bureau
of Finance Liaoning province. The subsidy should be deferred over the useful life of related asset (i.e. 10 years). In 2011
the revenue should be recognized at RMB 737,000.00.
The compensation for Dalian plants moving is RMB 59,820,000.00, which is paid by Dalian State-owned Assets
Investment Business Group Company Limited. And the amount of making up for the removal loss of the current period is
RMB48,676,244.95；The rest is the removal compensation related with assets, which is amortized 18 years according to
the new fixed assets formed after the Dalian branch removal. The income confirmed in this year is RMB 2,704,235.80
7.26 Share capital
Unit: Yuan
Increase/ decrease（＋、－）
Transferring
2012.01.01 Issuing new Distributing 2012.06.30
capital reserves to s Others Subtotal
shares shares
capital
Total shares 402,600,000 0 402,600,000
7.27 Capital reserves
Unit: Yuan
Items 2012.01.01 Increase Decrease 2012.06.30
Share premium 201,956,446.52 201,956,446.52
Other capital reserves 283,734,603.95 283,734,603.95
Total 485,691,050.47 0 0 485,691,050.47
7.28 Surplus reserves
Unit: Yuan
Items 2012.01.01 Increase Decrease 2012.06.30
Statutory surplus reserve 103,381,649.26 103,381,649.26
Discretionary surplus reserve 20,590,618.91 20,590,618.91
Total 123,972,268.17 123,972,268.17
7.29 Undistributed profit
61
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Unit: Yuan
2012.06.30 2012.01.01
Item
Provision or Provision or
Amount Amount
distribution % distribution %
Undistributed profit as at 30
507,873,600.57 -- 477,496,320.23 --
June, 2012
7.30 Operating revenue & cost
（1）Operating revenue & cost
Unit: Yuan
Item 2012.01.01-2012.06.30 2011.01.01-2011.06.30
Revenue from main operation 1,373,071,130.04 1,409,588,079.02
Revenue from other operation 244,675,564.99 348,277,584.26
Operation cost 1,433,460,380.71 1,549,779,169.18
（2）Main operation - classified according to operation
√ applicable □ inapplicable
Unit: Yuan
2012.01.01-2012.06.30 2011.01.01-2011.06.30
Items
Sales revenue Cost of sales Sales revenue Cost of sales
Export 136,789,260.11 137,835,006.35 92,059,807.51 93,338,365.04
Transportation vehicle bearings 495,964,564.24 440,341,915.64 552,386,739.64 487,643,937.89
Special use bearings 282,818,191.38 237,585,214.27 288,116,927.78 239,407,962.19
General use bearings 403,687,524.75 350,746,226.95 404,943,846.52 352,000,103.57
Industrial Operations 53,811,589.56 59,693,569.81 72,080,757.57 72,863,731.1
Total 1,373,071,130.04 1,226,201,933.02 1,409,588,079.02 1,245,254,099.79
（3）Main operation - classified according to products
√applicable □ inapplicable
Unit: Yuan
2012.01.01-2012.06.30 2011.01.01-2011.06.30
Items
Sales revenue Cost of sales Sales revenue Cost of sales
Bearings 1,319,259,540.48 1,166,508,363.21 1,337,507,321.45 1,172,390,368.69
Components 53,811,589.56 59,693,569.81 72,080,757.57 72,863,731.1
Total 1,373,071,130.04 1,226,201,933.02 1,409,588,079.02 1,245,254,099.79
（4）Main operation - classified according to region
√ Applicable □ inapplicable
Unit : Yuan
Items 2012.01.01-2012.06.30 2011.01.01-2011.06.30
62
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Sales revenue Cost of sales Sales revenue Cost of sales
Export 136,789,260.11 137,835,006.35 92,059,807.51 93,338,365.04
Domestic 1,236,281,869.93 1,088,366,926.67 1,317,528,271.51 1,151,915,734.75
Total 1,373,071,130.04 1,226,201,933.02 1,409,588,079.02 1,245,254,099.79
（5）Sales revenue from top 5 customers
Unit : Yuan
Items Sales revenue Accounting for proportion of total
China railway material company 67,267,798.32 4.16%
China Heavy Vehicle Group Jinan
56,538,065.5 3.49%
Qiaoxiang Company Limited
China shenhua engery company
railway locomotive transport 31,837,377.78 1.97%
company
Gangzhou wazhou railway
30,019,104.99 1.86%
bearing sales company
Tian Jin municipality Hua Mei
24,615,160.65 1.52%
Wazhou selling Co.,Ltd
Total 210,277,507.24 13%
7.31 Operating taxes and surcharges
Unit : Yuan
Item The period amount Previous period amount Applicable tax rate (%)
Consumer tax
Business tax 392,064.6 263,731.81 5%
City construction tax 3,474,108.43 3,753,470.16 7%
Education surcharge 2,491,918.85 2,583,297.72 4%
Resource tax
Other 27,613.01 17,739.39
Total 6,385,704.89 6,618,239.08 --
7.32 Investment income
（1）Sources of investment income
Unit: Yuan
Item The period amount Previous period amount
Long-term equity investment income under cost
method
Long-term equity investment income under equity
2,985,002.73 6,302,534.5
method
Investment income from disposal of long-term
-6,938.21 0
equity investment
63
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Total 2,978,064.52 6,302,534.5
（3）Long-term equity investment income under equity method
Unit: Yuan
Previous period
Items The period amount Reason for change
amount
Incl: Dalian SKF Wazhou Bearings Co.,
2,985,002.73 6,302,534.5 The associates profits decreased
Ltd.
Total 2,985,002.73 6,302,534.5 --
7.33 Assets impairment losses
Unit: Yuan
Items The period amount Previous period amount
Loss of bad debts 295,087.17 206,649.94
Loss of long-term equity investment
Total 295,087.17 206,649.94
7.34 Non-operating income
（1）
Unit: Yuan
Item 2012.01.01-2012.06.30 2011.01.01-2012.06.30
Gains on disposal of non-current assets 644,282.54 4,558,735.3
Including: gains on disposal of fixed assets 644,282.54 4,558,735.3
gains on disposal of intangible asst\ets
Income from debt restructuring 1,448,127.73 342,225.97
Government grants 1,720,617.92 5,100
Penalty income 22,599.15 1,499
Others 139,022.95 694,565.85
Total 3,974,650.29 5,602,126.12
（2）details
Unit :Yuan
Item 2012.01.01-2012.06.30 2011.01.01-2012.06.30 Note
Improvement subsidy 368,500
Compensation for plants moving 1,352,117.92
Booth fees 5,100
Total 1,720,617.92 5,100 --
7.35 Non-operating expenses
Unit: Yuan
Item 2012.01.01-2012.06.30 2011.01.01-2012.06.30
Loss on disposal of non-current assets 33,413.92
64
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Including: Loss on disposal of fixed assets 33,413.92
Loss on disposal of intangible asst\ets
Income from debt restructuring 1,632,022.46 213,436.55
Others 781,443.98 768,278.23
Total 2,413,466.44 1,015,128.7
7.36 Income tax expenses
Unit: Yuan
Item 2012.01.01-2012.06.30 2011.01.01-2012.06.30
Current income tax expenses 3,052,564.11 10,381,701.83
Deferred income tax expenses
Total 3,052,564.11 10,381,701.83
7.37 Calculation of basic earnings per share and diluted earnings per share
Items No. The period Previous period
1 30,377,280.34 53,579,496.41
Net profit attributable to shareholders of parent
company
2 1,561,183.85 4,586,997.42
Non-operating profit and loss attributable to
shareholders of parent company
3=1-2 28,816,096.49 48,992,498.99
Net profit after deducting non-operating profit
and loss attributable to shareholders of parent
company
4 402,600,000.00 402,600,000.00
Total number of shares at the period begin
5 — —
The number of shares increased due to
transferring capital reserve into share capital or
dividend distribution of shares during report
period (Ⅰ)
6 — —
The number of shares increased due to issuance
of new shares or debt for equity swap during the
report period (Ⅱ)
7 — —
the number of shares (Ⅱ)from the next month
to the end of the report period for increase of
shares
8 — —
The number of months decreased due to stock
65
Wafangdian Bearing Company Ltd. Midyear Report of 2012
repurchase or draw back stock during the report
period
9 — —
The number of months from the next month to
the end of the report period for decrease of
shares
10 — —
The number of shares for decrease of shares
11 — —
Duration of the period in terms of month
12=4+5+6×7÷11 402,600,000.00 402,600,000.00
Weighted average number of ordinary shares
issued out -8×9÷11-10
EPS – basis (Ⅰ)
13=1÷12 0.08 0.13
EPS – basis (Ⅱ)
14=3÷12 0.07 0.12
Potential diluted interests of ordinary shares
recognized as expense
15 — —
Transfer fee
16 — —
EIT rate
17 — —
Weighted average amount of ordinary shares
increased due to warrant, share options
18 — —
EPS – diluted (Ⅰ)
19=[1+(15-16)×(1 0.08 0.13
EPS – diluted (Ⅱ)
-17)]÷(12+18)
19=[3+(15-16)×(1 0.07 0.12
Duration of the period in terms of month
-17)]÷(12+18)
合计
7.38 Notes to cash flow statement
（1）Cash receipt/payment of other operating/financing activities
Unit: Yuan
Item Amount
Return of reserve fund, deposit etc. 6,650,395.2
Interest income 1,020,713.94
Total 7,671,109.14
（2）Other cash paid relating to operating activities
Unit: Yuan
66
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Item Amount
Trademark use fee 9,000,000
Travel expenses 13,986,192.34
Rent expense 9,941,172.13
Freight service expense 14,306,806.02
Conference expense 9,955,624.8
Collection and payment for others 3,116,016.35
Office expense 3,909,744.1
Market developing expenses 1,158,248.67
Guard and fire fighting expense 1,620,000
Business promotion expense 2,129,419.62
Total 9,537,870.68
Total 78,661,094.71
7.39 Supplementary information of consolidated cash flow statement
（1）Supplementary information
Unit: Yuan
Item Amount in the period Amount in the previous period
1. Adjusting net profit into cash flows of operating
-- --
activities:
Net profit 30,377,280.34 53,579,496.41
Add: Provision for impairment of assets 295,087.17 206,649.94
Depreciation of fixed assets 39,206,790.74 42,261,896.82
Amortization of intangible assets 2,144,947.32 2,154,705.03
Amortization of long-term deferred expenses 42,906.71 120,402.96
Losses on disposal of fixed assets, intangible assets, and
-644,282.54 -4,525,321.38
long-term assets (income listed with”-”)
Financial expense (income listed with”-”) 13,815,248.96 12,337,942.4
Investment loss (income listed with”-”) -2,978,064.52 -6,302,534.5
Decrease of deferred tax assets(increase listed with”-”)
Increase of deferred tax liabilities(decrease listed
with”-”)
Decrease of inventories (increase listed with”-”) 84,429,746.86 -54,940,815.54
Decrease of operating receivables (increase listed
-191,225,781.9 -212,387,652.92
with”-”)
67
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Increase of operating payables (decrease listed with”-”) 173,391,446.6 258,884,501.55
Others
Net cash flows arising from operating activities 148,855,325.74 91,389,270.77
2. Significant investment and financing activities
-- --
unrelated to cash income and expenses
Liabilities transferred to capital
Convertible bonds within 1 year
Financing leased fixed assets
3. Net increase (decrease) of cash and cash equivalent -- --
Ending balance of cash 92,645,925.15 79,938,608.43
Less: Opening balance of cash 62,187,956.71 52,057,009.69
Add: Ending balance of cash equivalent
Less: Opening balance of cash equivalent
Net increase of cash and cash equivalent 30,457,968.44 27,881,598.74
（3）Cash and cash equivalents
Unit: Yuan
Item 2012.06.30 2012.01.01
Cash 92,645,925.15 62,187,956.71
Including: Cash on hand 311,328.15 328,678.6
Bank deposit used for paying at any moment 91,807,975.27 61,333,040.65
Other cash used for paying at any moment 526,621.73 526,237.46
Cash equivalents
Including: Bond investment due within 3 months
Closing balance of cash and cash equivalents 92,645,925.15 62,187,956.71
8 Related parties relationship and transactions
8.1 Parent company and ultimate controller
Unit: Yuan
Parent Legal
Relatiobn Enterpris Registere Business Registere Holding Voting ultimate Organization
representa
ship d capital (%) (%) controller code
company e nature d address tiv nature
68
Wafangdian Bearing Company Ltd. Midyear Report of 2012
No. 1
supervisin
North g and
Manufactu
Managing
re and
Gongji Committee
Wazhou sales of
Parent State-owne Wang 413,793,10 of Dalian
Street, bearing 60.61% 60.61% 24238666-3
company Lushun 0 Governme
Group d Limited and other
nt for
Wafangdia equipment
Stated
s
n City, Owned
Assets
Dalian
Note: Wafangdian Bearing Group Corporation is a state-owned sole venture company, the actual controller is
supervising and Managing Committee of Dalian Government for Stated Owned Assets, the office Address is No.576,
Zhongshan Road, Shahekou District Dalian City. And the director is Wang Chun.
8.2 Subsidiaries
Unit: Yuan
Legal
Subsidiarie Relatiobns Enterprise Registered Business Registered Holding Organizati
representat Voting (%)
s hip capital (%) on code
nature address iv nature
No.61, Manufactur
Weiguo e and sales
Liaoyang Stock road, Baita of bearing
Limited Shao Yang 19,350,000 100% 100% 12199127-7
Bearing holding district and
Liaoyang machine
city manufacture
No.12,
Manufactur
Shisanli
e and sales
Dalian yongsheng
Stock of bearing
Electrical Limited street, Shao Yang 10,000,000 100% 100% 55980608-0
holding and
Equipment free trade
machine
zone Dalian
manufacture
city
69
Wafangdian Bearing Company Ltd. Midyear Report of 2012
8.3 Information on Joint venture
Unit: Yuan
Total
Total net Total sales
Enterprise Registered Legal Holding Voting Total assets liabilities as assets as at revenue in Net profits
Business Registered Relationshi Organizati
Investee representat as at June at in the H1 of
nature address nature capital % % June 30 the H1 of p on code
ive 30 2012
June 30 2012
2012 2012
2012
Jonit
-- -- -- -- -- -- -- -- -- -- -- -- -- --
venture
No.1, Wang Lushun
Phrase 1, Manufacture
Dalian SKF Chinese-for
and sales of
Wazhou Gongji
eign equity ball-surface 140,000,000 49% 49% 23,475.63 4,517.81 18,957.82 9,802.27 609.18 联营企业 70218806-0
Bearings Street, rolling
Co., Ltd. joint venture
Wafangdian bearing
North
70
Wafangdian Bearing Company Ltd. Midyear Report of 2012
8.4 Other Related parties relationship information
Unit: Yuan
Name relationship Organization code
Dalian Wazhou Manufacturing Equipment Other companies controlled by the same parent
24239291-6
Co., Ltd company and ultimate controlling party
Dalian Manufacturing Equipment Other companies controlled by the same parent
69140874-1
investment Company Limited company and ultimate controlling party
Other companies controlled by the same parent
Wazhou Steel Ball Company 76078283-4
company and ultimate controlling party
Other companies controlled by the same parent
Wazhou Exact Forge Ltd. 76079407-7
company and ultimate controlling party
Wazhou Group Turnplate Bearing Ltd Other companies controlled by the same parent
66112524-9
company and ultimate controlling party
Wazhou Group Exact Transmission Other companies controlled by the same parent
66582213-x
Bearing Co., Ltd company and ultimate controlling party
Wazhou Group Precision special-use Other companies controlled by the same parent
56552248X
Bearing Company Limited company and ultimate controlling party
Da Lian Wazhou Jin Zhou Machine The GM of the WBC served as chairman of the
57605032-6
Co.,Ltd company
Da Lian Wazhou Fengyuan Machine The GM of the WBC served as chairman of the
57605568-8
Co.,Ltd company
8.5 Related party transactions
(1) Purchase of goods or labors
Unit: Yuan
2012.06.30 2011.06.30
Relative parties Content Principle of price
Amount % Amount %
Associates:
Including: Dalian Procurement of
SKF Wazhou finished Negotiated price 86,536,401.16 4.69% 104,807,746.88 5.58%
Bearings Co., Ltd. goods
Other companies
controlled by the
same parent company
Procurement of semi
Including: Wazhou finished Market price 4,795,034.2 0.26% 9,665,059.82 0.51%
Steel Ball Company
goods
Procurement of semi
Wazhou Exact Forge finished Market price 134,851,660.65 7.3% 239,449,854.41 12.74%
Ltd.,
goods
Dalian Wazhou Procurement of
Manufacturing finished Market price 8,773,401.12 0.48% 9,978,761.83 0.53%
Equipment Co., Ltd Goods
Procurement of
Wazhou Group finished Market price 47,462,221.5 2.57% 20,305,363.08 1.08%
Turnplate Bearing Ltd
Goods and labors
Wazhou Group Exact Procurement of Market price 68,942,848.37 3.73% 49,600,148.62 2.64%
71
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Transmission Bearing finished
Co., Ltd goods
Wazhou Group Procurement of
Precision special finished Market price 12,274,987.53 0.65%
Bearing Company
Limited goods
Other related parties
Da Lian Wazhou
Fengyuan Machine Procurement of lathes Market price 53,480,698.48 2.9% 0 0%
Co.,Ltd
Da Lian Wazhou Jin
Zhou Machine Procurement of lathes Market price 50,220,644.83 2.72% 0 0%
Co.,Ltd
Total 455,062,910.31 24.64% 446,081,922.17 23.73%
(2).Sales of goods and supply of labors
Unit: Yuan
Principle 2012.06.30 2011.06.30
Relative parties Content
of price Amount %
Parent company:
Including: Wazhou Sales of finished goods and
Market price -8,581,155.49 -0.53% 13,825,465.42 0.79%
Group materials
Associates: 0% 0%
Including: Dalian
Sales of semi finished goods
SKF Wazhou Negotiated price 29,748,687.88 1.84% 41,977,744.41 2.39%
and materials
Bearings Co., Ltd.
Other companies
controlled by the
0%
same parent
company
Including: Wazhou
Sales of materials Negotiated price 4,365,001.45 0.27% 6,120,820.86 0.35%
Steel Ball Company
Wazhou Exact Forge
Sales of materials Negotiated price 186,322,652.28 11.52% 212,642,796.07 12.09%
Ltd.,
Dalian Wazhou
Sales of finished goods and
Manufacturing Market price 1,287,960.84 0.08% 904,108.71 0.05%
materials
Equipment Co., Ltd
Wazhou Group
Sales of semi finished goods
Turnplate Bearing Market price 10,525,530.76 0.64% 51,948,101.86 2.96%
and materials
Ltd
Wazhou Group Sales of semi finished goods
Exact Transmission and materials and industrial Market price 17,888,650.88 1.1% 19,107,417.33 1.09%
Bearing Co., Ltd work
Wazhou Group
Sales of semi finished goods
Precision special
and materials and industrial Market price 6,216,993.25 0.38% 9,106,614.9 0.51%
Bearing Company
work
Limited
Other related parties 0%
Da Lian Wazhou Jin
Sales of materials and
Zhou Machine Market price 1,716,641.66 0.11% 0 0%
industrial work
Co.,Ltd
Total 249,490,963.51 15.14% 355,633,069.56 20.23%
72
Wafangdian Bearing Company Ltd. Midyear Report of 2012
(3) Assets rent out
Unit: Yuan
Mature Lease income
Category of Starting
Lessor Lessee Proportion Amount Basis of lease pricing recognized in the Influence to the company
assets rent out date date current period
The Wazhou Exact
Land 7,811m2 3,163,455 2012.01.01 2012.12.31 8Yuan/ m2 per year 00
Company Forge Ltd.,
The Wazhou Steel
Land 13,171 m2 5,597,675 2012.01.01 2012.12.31 8Yuan/ m2 per year 00
Company Ball Company
Lease expense=(lease assets
annual deprecation + estimate
The Wazhou Exact value* asset return
Building 9,177 m2 4,775,500 2012.01.01 2012.12.31 00
Company Forge Ltd., rate)/(1-operite tax rate-
rate*tax and additional tax
rate)
Wazhou
Lease expense=(lease assets
Group
annual deprecation + estimate
Precision
The value* asset return
special Building 6,534.4 m2 5,116,000 2012.01.01 2012.12.31 00
Company rate)/(1-operite tax rate-
Bearing
rate*tax and additional tax
Company
rate)
Limited
Lease expense=(lease assets
Da Lian
annual deprecation + estimate
Wazhou
The value* asset return
Fengyuan Building 1,791 m2 1,473,350.87 2012.01.01 2012.12.31 53,730 Take up0.16% of the total profit
Company rate)/(1-operite tax rate-
Machine
rate*tax and additional tax
Co.,Ltd
rate)
Lease expense=(lease assets
Da Lian annual deprecation + estimate
The Wazhou Jin value* asset return
Building 8,118 m2 8,887,474.07 2012.01.01 2012.12.31 243,540 Take up0.73% of the total profit
Company Zhou Machine rate)/(1-operite tax rate-
Co.,Ltd rate*tax and additional tax
rate)
Total 29,013,454.94 297,270 Take up0.89% of the total profit
73
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Assets under lease
Lease expense
Category Proportio Mature confirmed in Influence to the
Lessor Lessee Amount Starting date Basis of lease pricing
of assets n date the current company
period
Wazhou The 51,302.2
Land 7,182,308 2012.01.01 2012.12.31 8Yuan/ m2 per year 410,417.6 0
Group Company m2
Da Lian
Wazhou
Precision
Wazhou
dynamo Land 28,210 m2 11,735,360 2012.01.01 2012.12.31 8Yuan/ m2 per year 52,893.75 0
Group
car
bearing
Co.,Ltd
Lease expense=(lease assets
annual deprecation +
Wazhou
The estimate value* asset return
Steel Ball Building 2,592 m2 2,721,600 2012.01.01 2012.12.31 00
Company rate)/(1-operite tax rate-
Company
rate*tax and additional tax
rate)
Lease expense=(lease assets
annual deprecation +
Wazhou The 65,832.99 149,933,30 estimate value* asset return
Building 2012.01.01 2012.12.31 6,200,000 0
Group Company m2 0 rate)/(1-operite tax rate-
rate*tax and additional tax
rate)
Total 6,663,311.35
74
Wafangdian Bearing Company Ltd. Midyear Report of 2012
(4). Guarantee to associate parties
Unit: Yuan
Guarantor Guarantee Amount Beginning date Mature date The guarantee is over or not
WBGC The company 300,000,000.00 2007-3-7 2015-3-7 No(record: 1)
WBGC The company 46,460,000.00 2012-03-16 2013-3-15 No(record: 2)
WBGC The company 43,540,000.00 2012-03-23 2013-3-15 No(record: 2)
Statement:
Statement 1: The guarantee is WBGC provide to the company, since the company borrowed 300 million Yuan
from Country Development Bank, at the end of 2012.06.30, the loan is with amount of 8000 thousand Yuan.
Statement 2: The guarantee is WBGC provide to the company, since the company borrowed 90 million Yuan
from Import and Export Bank, at the end of 2012.06.30, the loan is with amount of 90 million Yuan.
8.6 Accounts receivable and payable due to related parties
(1)Accounts receivable due from related parties
Unit: Yuan
Items Related parties 2012.06.30 2012.01.01
Accounts receivable Wazhou Group 7,523,401.47 25,365,740.94
Accounts receivable Wazhou Group Turnplate Bearing Ltd 8,170,254.23
Accounts receivable Wazhou Exact Forge Ltd 6,267,154.37 0
Accounts receivable Wazhou Special precision Co., Ltd 6,521,998.48 3,956,619.13
Dalian wazhou Feng Yuan machinery
Accounts receivable 629,563.26
Co., LTD
Total 20,312,554.32 38,122,177.56
(2) payable due to related parties
Unit: Yuan
Items Related parties 2012.06.30 2012.01.01
Accounts payable Dalian SKF Wazhou Bearings Co., Ltd 102,228,644.99 129,040,585.45
Accounts payable Wazhou Exact Forge Ltd. 83,997,441.08
Accounts payable Wazhou Group Turnplate Bearing Ltd 21,292,462.65
Accounts payable Wazhou Steel Ball Company 1,502,986.51 4,068,575.67
Accounts payable Wazhou Group Precision Transmission Bearing
62,997,342.9 79,800,622.41
Company Limited
Accounts payable Dalian Wazhou Manufacturing Equipment Co.,
5,937,310.76 7,922,351.43
Ltd
Accounts payable Dalian wazhou Feng Yuan machinery Co., LTD 14,568,076.92
Accounts payable Dalian wazhou JinZhou machinery Co., LTD 7,545,880.44
Other payable Wazhou Group 29,796,527.28 25,923,909.17
9. Notes to the main items of the financial statements of parent company
9.1 Accounts receivable
75
Wafangdian Bearing Company Ltd. Midyear Report of 2012
（1）Accounts receivable
2012.06.30 2012.01.01
Items Booking balance Provision Booking balance Provision
Amount % Amount % Amount % Amount %
Other receivables with
individual significant
amount and identification 3,910,007.43 0.36% 3,910,007.43 100% 3,910,007.43 0.38% 3,910,007.43 100%
separately bad debt
provision
Other receivables accrued
bad debt provision by
portfolio
1,023,039,574.8
Accounting aging portfolio 94.77% 31,504,358.6 3.08% 932,091,668.42 90.18% 31,821,808.28 3.41%
5
Related parties portfolio 40,730,376.61 3.77% 85,735,822.23 8.3%
Risk-free portfolio
1,063,769,951.4
Subtotal of portfolio 98.54% 31,504,358.6 2.96% 1,017,827,490.65 98.48% 31,821,808.28 3.13%
6
Other receivables with
individual insignificant
amount and identification 11,813,753.94 1.09% 11,813,753.94 100% 11,813,753.94 1.14% 11,813,753.94 100%
separately bad debt
provision
1,079,493,712.8
Total -- 47,228,119.97 -- 1,033,551,252.02 -- 47,545,569.65 --
3
1）Individually significant amounts of accounts receivable accrued the bad debt provision separately at the end of
2012.06.30
Unit: Yuan
Provision for bad Proportion
Debtors name Booking balance Reasons for provision
debts (%)
Baoding North China Machine &
Electronic Equipment Ltd Co.
3,910,007.43 3,910,007.43 100.00 A/R with over 5 years
aging, unlikely to be
collected
Total 3,910,007.43 3,910,007.43 — —
76
Wafangdian Bearing Company Ltd. Midyear Report of 2012
2) Other receivable accrued the bad debt provisions in the portfolio as accounting aging analysis method
Unit: Yuan
Items 2012.06.30 2012.01.01
Amount % Provision Amount % Provision
Within 1 year 914,359,248.9 89.38% 9,143,592.49 807,014,942.85 86.58% 8,070,149.43
Subtotal within 1 year 914,359,248.9 89.38% 9,143,592.49 807,014,942.85 86.58% 8,070,149.43
1-2 years 66,741,929.89 6.52% 3,337,096.49 81,916,697.71 8.79% 4,095,834.89
2-3 years 6,485,094.71 0.63% 1,297,018.94 6,413,966.59 0.69% 1,282,793.32
Over 3 years 35,453,301.35 3.47% 17,726,650.68 36,746,061.27 3.94% 18,373,030.64
3-4 year 24,817,310.95 2.43% 12,408,655.48 25,722,242.89 2.76% 12,861,121.45
4-5 year 7,090,660.27 0.69% 3,545,330.136 7,349,212.254 0.79% 3,674,606.128
Over 5 years 3,545,330.135 0.35% 1,772,665.068 3,674,606.127 0.39% 1,837,303.064
Total 1,023,039,574.85 -- 31,504,358.6 932,091,668.42 -- 31,821,808.28
3) Other receivable accrued the bad debt provisions in the portfolio as accounting other method
Unit: Yuan
Items Booking balance Provision
Related parties portfolio 40,730,376.61 0
Risk-free portfolio 0 0
Total 40,730,376.61 0
4) Individually insignificant amount accounts receivable but accrued bad debt provision separately at the end of
2012.06.30
Unit: Yuan
Booking Provision for Proportion
Company name Reasons for provision
balance bad debts (%)
Shenyang Sewerage
2,706,703.13 2,706,703.13 100% A/R with over 5 years aging, unlikely to be collected
Equipment Co.,Ltd
Shen Yang General A/R with over 3 years aging, forms a book difference
2,452,138.58 2,452,138.58 100%
between both sides.
Bearing Co.,Ltd
Tiefa coal sector A/R with over 3 years aging, forms a book difference
2,352,760.15 2,352,760.15 100%
between both sides.
Group Company
A/R with over 3 years aging, forms a book difference
Shuangyashan Mining 1,368,257.55 1,368,257.55 100%
between both sides.
77
Wafangdian Bearing Company Ltd. Midyear Report of 2012
industry Group
Company
Chongqing Sailimeng A/R with over 3 years aging, forms a book difference
650,758.88 650,758.88 100%
between both sides.
electrical machine LLC
Qingdao Qingte A/R with over 3 years aging, forms a book difference
590,898.99 590,898.99 100%
between both sides.
Zhongli axle Co.,Ltd
Other sporadic accounts
1,692,236.66 1,692,236.66 100% A/R with over 5 years aging, unlikely to be collected
receivable
Total 11,813,753.94 11,813,753.94 100%
（2）Accounts receivable due from shareholders holding over 5% (including 5%) of the Company’s shares
Unit: Yuan
2012.06.30 2012.01.01
Debtor name Amount Provision for bad Amount Provision for bad debt
debt
Wazhou Group 7,523,401.47 0 25,365,740.94 0
Total 7,523,401.47 0 25,365,740.94 0
（3）Accounts receivable for the top 5 companies
Unit: Yuan
Relationship with the
Company name Amounts Aging % in the total AR
Company
China Railway Materials
Unrelated party 54,672,480.56 Within 1 year 5.06%
Company
Daqin railway Stock Co.,Ltd Unrelated party 26,717,017.96 Within 1 year 2.47%
Dalian Huarui Company Limited Biggest shareholder 24,909,219.41 Within 1 year 2.31%
Shanxi Fast Gearing Company
Unrelated party 18,131,040.86 Within 1 year 1.68%
Limited
Dalian Long Hui Industrial and
Unrelated party 17,394,507.47 Within 1 year 1.61%
Business Company Limtied
Total 141,824,266.26 13.14%
9.2 Other receivables
(1) The category of other receivable
Unit: Yuan
78
Wafangdian Bearing Company Ltd. Midyear Report of 2012
2012.06.30 2012.01.01
Items Booking balance Provision Booking balance Provision
Amount % Amount % Amount % Amount %
Other receivables with
individual significant
amount and identification 0 0% 0 0% 0 0% 0 0%
separately bad debt
provision
Other receivables accrued
bad debt provision by
portfolio
Accounting aging portfolio 11,760,123.06 94.53% 993,498.85 8.45% 10,216,033.67 92.73% 993,498.85 9.72%
Related parties portfolio 0 0% 0 0%
Risk-free portfolio 680,018.19 5.47% 0 0% 801,514.74 7.27%
Subtotal of portfolio 12,440,141.25 100% 993,498.85 7.99% 11,017,548.41 100% 993,498.85 9.02%
Other receivables with
individual insignificant
amount and identification 0 0% 0 0% 0 0% 0 0%
separately bad debt
provision
Total 12,440,141.25 -- 993,498.85 -- 11,017,548.41 -- 993,498.85 --
1) Other receivable accrued the bad debt provisions in the portfolio as accounting aging analysis method
Unit: Yuan
Items 2012.06.30 2012.01.01
Amount % Provision Amount % Provision
Within 1 year 9,311,114 79.18% 93,111.14 7,826,406.81 76.62% 78,264.07
Subtotal within 1 year 9,311,114 79.18% 93,111.14 7,826,406.81 76.62% 78,264.07
1-2 years 586,234.6 4.98% 29,311.73 492,921.58 4.82% 24,646.08
2-3 years 201,037.5 1.71% 40,207.5 192,546.46 1.88% 38,509.29
Over 3 years 1,661,736.96 14.13% 830,868.48 1,704,158.82 16.68% 852,079.41
3-4 year 1,163,215.872 9.89% 581,607.936 1,192,911.174 11.68% 596,455.59
4-5 year 332,347.392 2.83% 166,173.696 340,831.764 3.34% 170,415.88
79
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Over 5 years 166,173.696 1.41% 83,086.848 170,415.882 1.67% 85,207.94
Total 11,760,123.06 -- 993,498.85 10,216,033.67 -- 993,498.85
2) Other receivable accrued the bad debt provisions in the portfolio as accounting other method
Unit: Yuan
Items Booking balance Provision
Related parties portfolio
Risk-free portfolio 680,018.19 0
Total 680,018.19 0
(2) Other receivables from the top 5 debtors
Unit: Yuan
Relationship with the % of the
Detor name Amounts Aging
Company total OR
Xi’an Railway Bureau Unrelated party 100,000 Within 1 year 0.8%
Wu Han Railway Bureau Unrelated party 99,200 Within 1 year 0.8%
Lan Zhou Railway Bureau Unrelated party 90,000 Within 1 year 0.72%
Mei Shan Vehivle Unrelated party 30,000 Within 1 year 0.24%
Nan Vehicle car company in Shi Unrelated party 20,000 Within 1 year 0.16%
Jia Zhuang
Total 339,200 2.73%
80
Wafangdian Bearing Company Ltd. Midyear Report of 2012
9.3 Long-term equity investments
Unit: Yuan
Reason of
Difference Provision Provision for
Ending Share Voting impairment Cash bonus
Invest cost at the Beginning
Investee Calculate between for calculated in reporting
beginning balance alteration balance holding %
shareholding impairment period
% in reporting period
and voting
Shanghai ME
machine-electrical 2,000,00
cost method 2,000,000 2,000,000 0 4.76% 4.76% 0 0 0 0
equipment chain 0
Ltd.
17,337,2
Liaoyang Bearing cost method 17,337,259.95 17,337,259.95 0 100% 100% 0 0 0 0
59.95
Dalian Wazhou
Precision Motor Car 45,478,9
cost method 10,478,956.37 45,478,956.37 0 100% 100% 0 0 0 0
Bearing Company 56.37
Limited
Dalian SKF Wazhou 2,985,002.7 87,442,6
equity method 68,600,000 84,457,621.14 49% 49% 0 0 0 0
3 23.87
Bearings Co., Ltd.
Shanghai Zhenxin
Wazhou Machinery
equity method 400,000 410,855.12 -410,855.12 0 40% 40% 0 0 0 0
and Electricity Co.,
Ltd.
2,574,147.6 152,258,
Total -- 98,816,216.32 149,684,692.58 -- -- -- 0 0 0
1 840.19
81
Wafangdian Bearing Company Ltd. Midyear Report of 2012
9.4 Operating revenue and cost
（1） Operating revenue, cost
Unit: Yuan
Items 2012.06.30 2011.06.30
Revenue from main operation 1,363,566,348.39 1,382,011,740.04
Revenue from other operation 246,967,858.45 367,578,892.85
Cost from operation 1,426,359,883.98 1,548,503,038.12
Total 3,036,894,090.82 3,298,093,671.01
(2) Main operation - classified according to industry
Unit: Yuan
2012.06.30 2011.06.30
Items
Sales revenue Cost of sales Sales revenue Cost of sales
Export 136,789,260.11 137,835,006.35 92,059,807.51 93,338,365.04
Transportation vehicle bearings 488,355,468.26 432,201,256.81 552,386,739.64 477,264,199.14
Special use bearings 282,818,191.38 237,585,214.27 288,116,927.78 234,312,047.1
General use bearings 400,426,483.61 347,257,373.16 373,091,397.99 344,507,609.91
Industrial Operations 55,176,945.03 61,162,035.12 76,356,867.12 76,129,542.38
Total 1,363,566,348.39 1,216,040,885.71 1,382,011,740.04 1,225,551,763.57
(3) Main operation - classified according to product
Unit: Yuan
2012.06.30 2011.06.30
Items
Sales revenue Cost of sales Sales revenue Cost of sales
Bearings 1,308,389,403.36 1,154,878,850.59 1,305,654,872.92 1,149,422,221.19
Component 55,176,945.03 61,162,035.12 76,356,867.12 76,129,542.38
Total 1,363,566,348.39 1,216,040,885.71 1,382,011,740.04 1,225,551,763.57
(4) Main operation - classified according to region
Unit: Yuan
2012.06.30 2011.06.30
Items
Sales revenue Cost of sales Sales revenue Cost of sales
Export 136,789,260.11 137,835,006.35 92,059,807.51 93,338,365.04
82
Wafangdian Bearing Company Ltd. Midyear Report of 2012
2012.06.30 2011.06.30
Items
Sales revenue Cost of sales Sales revenue Cost of sales
Domestic 1,226,777,088.28 1,078,205,879.36 1,289,951,932.53 1,132,213,398.53
Total 1,363,566,348.39 1,216,040,885.71 1,382,011,740.04 1,225,551,763.57
(5) Sales revenue from top 5 customers
Unit: Yuan
Items Sales revenue Accounting for proportion of
total
China Heavy Vehicle Group Jinan Qiaoxiang Company Limited 67,267,798.32 4.18%
China Railway Materials Company 56,538,065.5 3.51%
Guang Zhou Wazhou Bearing selling Company 31,837,377.78 1.98%
FAW Car Limited Company 30,019,104.99 1.86%
China Railway Materials Company 24,615,160.65 1.53%
Total 210,277,507.24 13.06%
9.5 Investment income
(1) Details of investment income
Unit: Yuan
Items 2012.06.30 2011.06.30
Income from long-term equity investments under cost method 0 0
Income from long-term equity investments under equity
2,985,002.73 6,302,534.5
method
Income on disposal of long-term assets -6,938.21 0
Total 2,978,064.52 6,302,534.5
(2) Long-term equity investment income under equity method
Unit: Yuan
Items 2012.06.30 2011.06.30 Reason for change
Dalian SKF Wazhou Bearings Co.,
2,985,002.73 6,302,534.5 The associates profits decreased
Ltd.
Total 2,985,002.73 6,302,534.5
9.6 Supplementary information of consolidated cash flow statement
Unit: Yuan
83
Wafangdian Bearing Company Ltd. Midyear Report of 2012
Items 2012.06.30 2011.06.30
1. Adjusting net profit into cash flows of operating activities:
Net profit 39,481,286.48 53,081,596.3
Add: Provision for impairment of assets 295,087.17 206,649.94
Depreciation of fixed assets 34,454,208.48 38,557,132.9
Amortization of intangible assets 2,144,947.32 2,154,705.03
Amortization of long-term deferred expenses 42,906.71 120,402.96
Losses on disposal of fixed assets, intangible assets, and long-term assets
-642,321 -3,405,658.21
(income listed with”-”)
Losses on write-off of fixed assets (income listed with”-”)
Financial expense (income listed with”-”) 13,502,411.13 12,082,558.94
Investment loss (income listed with”-”) -2,978,064.52 -6,302,534.5
Decrease of deferred tax assets(increase listed with”-”)
Increase of deferred tax assets (decrease listed with”-”)
Decrease of inventories (increase listed with”-”) 76,262,892.16 -24,162,208.48
Decrease of operating receivables (increase listed with”-”) -162,988,482.94 -202,164,931.31
Increase of operating payables (decrease listed with”-”) 149,643,647.71 222,331,421.96
Others
Net cash flows arising from operating activities 149,218,518.7 92,499,135.53
2. Significant investment and financing activities unrelated to cash
income and expenses
Liabilities transferred to capital — —
Convertible bonds within 1 year — —
Financing leased fixed assets — —
3. Net increase (decrease) of cash and cash equivalent
Ending balance of cash 91,173,945.34 77,898,307.61
Less: Opening balance of cash 59,742,088.63 43,756,831.34
Add: Ending balance of cash equivalent
Less: Opening balance of cash equivalent
Net increase of cash and cash equivalent 31,431,856.71 34,141,476.27
84
Wafangdian Bearing Company Ltd. Midyear Report of 2012
10. Supplementary information
10.1 Return on equity and earnings per share
Unit: Yuan
Weighted average return Earnings per share (EPS)
Profit of report period on net assets (%) Basic Diluted EPS
EPS
Net profit attributable to shareholders of parent company 2.02% 0.08 0.13
Net profit after deducting non-recurring gains and losses attributable to
1.91% 0.07 0.12
shareholders of parent company
Chapter Eight. List of reference documents
List of reference documents
1. The Accounting statements of the first half year of 2012 which is with the signatures and seals of the legal representative, finance
controller and the director of accounting department of the Company.
2. Original documents and notices of the Company disclosed in newspapers designated by the Security Supervisory Committee of
China in report period.
Chairman of the Board: Wang Lushun
The delivery date approved by Board Meeting: August 16, 2012
85