Wafangdian Bearing Company Limited 2018 Midyear Report
Wafangdian Bearing Company Limited
2018 Midyear Report
2018-22
August 17, 2018
Wafangdian Bearing Company Limited 2018 Midyear Report
Chapter I. Important Prompts, Table of Contents, and Definitions
The Board of Directors, board of supervisors, directors, supervisors, and top management of the Company hereby
guarantee that there are no false record, misleading statements and important omission of the material in this report, and
assume the individual and associated responsibilities for the truth, accuracy and completeness of the contents.
Besides the following directors, all the other directors attended the Board meeting and discussed the report.
Name Post Reasons Assignee name
Sun Maolin Director Busy work Zhang Xinghai
Chen Jiajun Director Busy work Zhang Xinghai
The Company plans not to distribute cash dividends or bonus shares or turn capital reserve into share capital.
Chairman Meng Wei , General Accountant Ms. Sun Najuan and accounting charger Ms. Sun Najuan declare:
guarantee the truth and completeness of the financial report in the annual report.
The description of the future development in this report does not constitute a commitment for
investors. Investors are requested to pay attention to the risks involved in your investment.
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Wafangdian Bearing Company Limited 2018 Midyear Report
Table of Contents
Chapter I. Important Prompts, Table of Contents, and Definitions ........................................................................... 1
Chapter II.Company Profile ........................................................................................................................................ 4
Chapter III Business Summary ................................................................................................................................ 5
ChapterⅤ Significant Events ................................................................................................................................... 9
I、The relevant annual general meeting and extraordinary general meeting held in the report
period ............................................................................................................................................................... 9
i.Shareholders' General Meeting in the report period ................................................................... 9
ii.The shareholders of the preferred shareholders who have resumed the voting are
required to convene an extraordinary general meeting ................................................................ 9
Inapplicable .................................................................................................................................................... 9
IV Engagement/Disengagement of CPAs ................................................................................... 9
V、Notice of the Board of Directors and the Supervisory Committee on the "non -standard audit
report" of the accounting firm during the reporting period ................................................................... 9
Inapplicable ......................................................................................................................................................... 9
VI、The Board of Directors of the previous year, "non-standard audit report" the relevant
circumstances of the note ........................................................................................................................... 9
VII. Matters concerning Bankruptcy Reorganization Inapplicable VIII. Significant Lawsuits and
Arbitrations Inapplicable ......................................................................................................................................... 9
ChapterⅥ. Changes in Capital Stock and Shareholders ............................................................................................... 22
ChapterⅦ. Relevant information about preferred stock ........................................................................................... 23
ChapterⅧ. Directors, Supervisors, Senior Management and Staff ........................................................................... 23
Chapter VIII. Financial Report................................................................................................................................... 24
2
Wafangdian Bearing Company Limited 2018 Midyear Report
Glossary
Terms Defined as Description
Company,the Company Defined as Wafangdian Bearing Company Limited
Wazhou Group Defined as Wafangdian Bearing Group Company
the report period, the current
Defined as January 1,2018–June 30,2018
period, the current year
Liaozhou Co.,Ltd Defined as Wazhou Liaoyang Bearing Manufacture Co.,Ltd
Dalian motor Defined as Dalian motor Bearing Co.,Ltd
SRB company Defined as Wazhou spherial roller bearing company limited
Wafangdian Bearing Company Limited The Board of
The Board of Directors Defined as
Directors
Wafangdian Bearing Company Limited The
The Supervisory Committee Defined as
Supervisory Committee
Wafangdian Bearing Company Limited The
The Shareholders‘Meeting Defined as
Shareholders‘Meeting
Shen Jiao Suo Defined as Shen Zhen Stock Exchange
SRC Defined as China Securities Regulatory Commission
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Wafangdian Bearing Company Limited 2018 Midyear Report
Chapter II.Company Profile
I. Company Information
Abbreviated name of the Stock code: 200706
Wazhou B
stock
Listing location of the
Shenzhen Stock Exchange
Company‘s 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 the
Meng Wei
Company
Registered address No. 1 Beigongji Street, Wafangdian City, Liaoning Province, China.
P.C 116300
office address No. 1 Beigongji Street, Wafangdian City, Liaoning Province, China.
office P.C 116300
Website http//www.zwz-200706.com
E-mail zwz2308＠126.com
II.Contacts
Secretary of the Board Representative of StockA ffairs
Name Sun Najuan Ke Xin
No. 1 Beigongji Street, Wafangdian City, No. 1 Beigongji Street, Wafangdian City,
Correspondence address
Liaoning Province, China. Liaoning Province, China.
Consulting telephone 0411-39116369 0411-39116732
Fax 0411-39116738 0411-39116738
E-mail zwz2308＠126.com zwz2308＠126.com
III.Other information
i.The way to contact with compay
In the report period the Registered address ,P.C, office address,office P.C of the company is no change.Detials can be seen in
2016annual report.
ii.Place for information disclosure
In the report period the place for information disclosure is no change. is no change.Detials can be seen in 2017 annual report.
IV Financial Highlights
Are there any retrospective adjustments or restatement of financial information of previous year due to change of accounting
policies or correcting of accounting errors?
[ ] Yes [V] No
In RMB Yuan
4
Wafangdian Bearing Company Limited 2018 Midyear Report
+/-（％）comparing with the
current period previous period
previous period
Turnover(RMB) 1,074,867,981.68 1,135,500,575.33 -5.34%
Net profit attributable to shareholders of the
3,313,980.12 2,633,635.55 25.83%
listed company(Yuan)
Net profit attributable to the shareholders of
the listed company and after deducting of -1,544,284.08 -1,562,254.31 -1.15%
non-recurring gain/loss(RMB)
Net Cash flow generated by business
44,206,595.23 -76,606,258.56 -157.71%
operation (RMB)
Basic earnings per share(Yuan/share) 0.008 0.007 14.29%
Diluted earnings per share(Yuan/share) 0.008 0.007 14.29%
Net return on equity(%) 0.24% 0.19% 0.05%
End of 2018.06.30 End of 2017.12.31 Changed over last year (%)
Total Assets (RMB) 3,213,612,720.94 3,213,772,171.61 0.00%
Owner‘s Equity Attributed to Shareholders of
1,388,808,854.83 1,385,494,874.71 0.24%
ListedCompany(RMB)
V. Differences in accounting information under IAS and domestic accounting standard
No difference
VI. Non-recurring gain/loss items and amounts
In RMB Yuan
Items Amount Remarks
Gain/loss of non-current assets (includes the neutralized part of the
167,969.78
asset impairment provision drawn already)
Gains and losses included in the current period of government
subsidies, excluding those government grants which are closely related
2,155,428.15
to normal business and in line with national policy, or in accordance with
fixed standards or quantities
Debt restructuring gains and losses 1,371,568.42
Other non-business income and expenditures other than the above 1,665,190.73
Influenced amount of income tax 501,892.88
Total 4,858,264.20 --
For the Companys non-recurring gain/loss items as defined in the Explanatory Announcement No.1 on Information
Disclosure for Companies Offering their Securities to the Public–Non-recurring Gains and Losses and its non-recurring
gain/loss items as illustrated in the Explanatory Announcement No.1 on Information Disclosure for Companies Offering their
Securities to the Public–Non-recurring Gains and Losses which have been defined as recurring gains and losses, it is
necessary to explain the reason.
□Applicable√Inapplicable
Chapter III Business Summary
I Principal Businesses in the Reporting Period
The scope of operation is: manufacture and sales of bearings, bearing components mechanical equipment, bearing
maintenance and technology service, automobile parts and fittings and other related products, lease of mechanical equipment
and buildings, and inspection of bearings and other related mechanical equipment and measure instruments.
Company has strong manufacturing capability and quality assurance capabilities, extensive services in railway, automobile,
metallurgy, mining and other industries and fields.
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Wafangdian Bearing Company Limited 2018 Midyear Report
II.Significant Changes in the Prime Assets
Inapplicable
III.Analysis on Core Competitiveness
As the country's largest bearing technology and product r&d and manufacturing base, company has accumulated much
practice experience in the field of bearings and related areas, set up perfect bearing technology innovation system, maintain
close cooperation with domestic scientific research institutes, colleges and universities. As the main drafter of bearing industry
a number of standard, company control the latest technology development trend in the industry. In technology research and
development, product manufacturing, marketing , customer services and other aspects have established a significant
advantage.
Company improve responsiveness to the market and customer personalized demand, in line with customer's
personalized design and needs of manufacturing processes balancing cost, delivery time and customer,
The company has complete product service system and 24-hour dynamic service ability product operating site. And was
praised with a good image of the "ten value-added services" by the majority customers. Company has strong manufacturing
capability and quality assurance capabilities, extensive services in railway, automobile, metallurgy, mining, and other
industries and fields.
Company has established strategic cooperative relations with key customers in domestic equipment applications, carry out
the depth of marketing through involvement in customer value engineer, set firmly up the company's brand and influence in
the domestic bearing market, the company has won the certification qualification of important target markets in the
international market , the international popularity established preliminary.
Chapter IV Discussion and Analysis of the Management
I. Overview
In the first half of 2018, the company adhered to the "four advantages" operating principle.Focusing on customers, improving
product quality and service quality, focusing on internal management and external market, overcoming negative cost factors
such as raw material cost and staff salary increase, and maintaining the sustainable and healthy development of the
company.
By the end of this report, the total assets of the company were 3213.61 million yuan, 0.01% lower than the beginning of the
year. The net assets belonging to shareholders of the listed company were 1388.8 million yuan, up 0.24% compared with the
beginning of the year. Net profit attributable to shareholders of the parent company was 3.31 million yuan, up 25.83 percent
from the same period last year.
II Analysis on Principal Businesses
1. General
Refer to ―I. General‖ of ―Discussion and Analysis of the Management”
2. Revenue and Costs
(1)Revenue
In RMB Yuan
Item Report period Last report period Changed Change reason
by %YoY
Business Income 1,074,867,981.68 1,135,500,575.33 -5.34%
Business Cost 939,746,571.13 1,004,195,641.99 -6.42%
Sales Expenses 70,739,571.63 76,020,179.92 -6.95%
Management Expenses 34,075,703.49 31,245,721.82 9.06%
Mainly, the current period Dalian Wazhou
24,052,423.13 16,016,268.75 50.17% Precision motor bearing co. LTD and Wazhou
Precision spherical roller bearing co.LTD
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Wafangdian Bearing Company Limited 2018 Midyear Report
(Wafangdian) generated 5.68 million discount
interest on behalf of discount, and the
Financial Expenses exchange loss increased by 2.29 million yuan.
Tax Expenses -279,426.81
Spending on research and
development of the business 47,796,129.00 46,000,000.00 3.90%
income ratio
Net Cash Flows from Operating
44,206,595.23 -76,606,258.56
Activities
Net Cash Flows from Investing
420,700.50 -1,449,577.77
Activities
Mainly, the cash inflow generated by
Net Cash Flows from Financing fund-raising activities decreased by 125.82
-27,723,409.01 34,930,007.77 -179.37%
Activities million yuan and the financing cash outflow
decreased by 63.16 million yuan
Net Increase in Cash and Cash
16,785,382.31 -43,617,574.73
Equivalents
The profit structure or source change greatly
□Applicable √Inapplicable
Main business composition
In RMB Yuan
+/-(%) of
+/-(%) of
Operating income Operating cost BOI operating +/-(%) of BOI
operating cost
income
By Industries
Export 134,389,724.30 127,690,513.67 4.98% -10.18% -0.72% -9.06%
Civil
Including: Traffic
216,585,762.48 198,183,287.87 8.50% -18.80% -22.12% 3.90%
Bearing
Special Bearing 247,415,855.83 216,744,034.46 12.40% 10.36% 8.63% 1.40%
Common
331,625,015.47 255,948,501.83 22.82% 19.42% 19.33% 0.06%
Bearing
Industrial income 37,029,623.49 42,082,834.30 -13.65% -83.45% -35.71% -17.30%
Bearing 930,016,358.08 798,566,337.83 14.13% 1.27% 0.18% 0.94%
Industry
37,029,623.49 42,082,834.30 -13.65% -45.49% -35.71% -17.30%
operation
Civil 832,656,257.27 712,958,658.46 14.38% -0.47% -2.86% 2.12%
Foreign 134,389,724.30 127,690,513.67 4.98% -10.18% -0.72% -9.06%
III . Analysis on Non-Principal Businesses
None
IV. Situation of assets and liabilities
1. Major change in asset item
End of 2018.06.30 End of 2017.06.30
Percentage of Statement on major
Percent in Percent in
Amount Amount change(%) change
total asset total asset
Monetary capital 185,921,246.44 5.79% 111,589,576.25 3.18% 2.61%
Account
1,169,506,871.73 36.39% 1,311,182,169.81 37.41% -1.02%
receivable
Inventories 712,471,443.43 22.17% 767,894,842.95 21.91% 0.26%
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Wafangdian Bearing Company Limited 2018 Midyear Report
Investment
132,182,083.40 4.11% 4.11%
property
Fixed assets 665,943,050.67 20.72% 740,842,980.06 21.14% -0.42%
Construction in
84,338,838.27 2.62% 205,126,816.36 5.85% -3.23%
process
Short term loan 615,000,000.00 19.14% 654,900,000.00 18.69% 0.45%
V. Investment
None
VI. Sales of Significant Assets and Equity
1. Sales of Significant Assets
None
2. Sales of Significant Equity
Inapplicable
VII. Analysis on Principal Subsidiaries and Mutual Shareholding Companies
Leading
Operating
Company Company Principal products Total assets, in Net assets Turnover in Net profit (in
profit (in
name type business and CNY (CNY) CNY CNY)
CNY)
services
Product and
Sale
Liaoyang
Bearing and 19,350,0 110,753,525.5 -53,041,653 60,149,332.
Bearing Subsidiary -344,728.62 -356,139.09
machine-ele 00.00 9 .24 79
company
ctrical
equipment
Dalian Product and
10,000,0 110,413,170.8 14,766,764. 84,506,462.
Electrical Subsidiary Sale -5,929,398.11 -4,825,060.06
00.00 5 81 54
Equipment Bearing
Wzhou
precision Product and
spherical Sales
194,000, 253,642,512.5 208,671,83 70,148,872.
roller Subsidiary Spherical -9,818,360.26 -4,856,311.96
000.00 6 1.51 86
bearing(Wafa Roller
ngdian) Bearing
Co.,Ltd.
VIII. Structurized Entities Controlled by the Company
Inapplicable
IX. Estimates for operating results for January to September 2017
Inapplicable
X The company faces risks and response measures
From the perspective of enterprises, China's economy is now in a transitional stage, and the advantages of traditional
manufacturing industry are gradually decreasing. The cost of raw materials such as bearing steel, as well as production
materials such as water, electricity and land, and the labor cost is also rising.From the client side, the client is transferring the
cost to upstream enterprises, bearing profit narrowing and other issues are increasingly prominent. With the deepening
reform of the country, China's equipment manufacturing industry has ushered in new development opportunities, and China's
bearing industry has also ushered in a rare local substitute market.
In the first half of 20118, the company adhered to the "four advantages" operating principle.Focusing on customers, improving
product quality and service quality, focusing on internal management and external market, overcoming negative cost factors
such as raw material cost and staff salary increase, and maintaining the sustainable and healthy development of the
company.
In the economic environment, the company has gradually realized the transition from production orientation to demand
orientation,taking customer as the center, implement the structural adjustment, and comprehensively improve the marketing
competitiveness; Strengthen the management of "four not movings", "six not startings, five not movings",improve product
quality competitiveness; use price lever, implement management responsibility, improve operation quality; Strengthen capital
control and reduce business risks; Continuous improvement of innovation management improves the operation quality of
enterprises.
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Wafangdian Bearing Company Limited 2018 Midyear Report
ChapterⅤ Significant Events
I、The relevant annual general meeting and extraordinary general meeting held in the report
period
i.Shareholders' General Meeting in the report period
Investor Meeting Disclosure Disclosure
Meeting session Type
participation ratio Date Date index
2017 Annual Annual
http//www,cni
Shareholer’s Shareholer’s 80.36% 2018.05.18 2018.05.19
nfo,com,cn
Meeting Meeting
ii.The shareholders of the preferred shareholders who have resumed the voting are required
to convene an extraordinary general meeting
II. Preplan for Profit Distribution and Conversion of Capital Reserve into Share Capital in the
Reporting Period
Inapplicable
III Commitments finished in implementation by the Company, shareholders, actual
controller,acquirer, directors, supervisors, senior executives or other related parties in the
reporting period and commitments unfinished in implementation at the end of the reporting
period
Inapplicable
IV Engagement/Disengagement of CPAs
Inapplicable
V、Notice of the Board of Directors and the Supervisory Committee on the "non -standard
audit report" of the accounting firm during the reporting period
Inapplicable
VI、The Board of Directors of the previous year, "non-standard audit report" the relevant
circumstances of the note
Inapplicable
VII. Matters concerning Bankruptcy Reorganization
Inapplicable
VIII. Significant Lawsuits and Arbitrations
Inapplicable
IX. Penalty and Rectification
Inapplicable
X. Integrity of the Company and its Controlling Shareholder and Actual Controller
Inapplicable
XI. Implementation of the Company’s Equit Incentive Plan, Employee Stock Ownership Plan or
other Employee Incentive Measures
Inapplicable
XII. Important Related Transactions
1.The relate transactions related to the day-to-day operations.
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Wafangdian Bearing Company Limited 2018 Midyear Report
The
More
Percent
Relativ Approv than
age of
e al the The Way Disclos
Relative Principle Relativ accoun Market Disclosu
Relative parties Relationship Content Amoun amount approv Of ure
type of price e Price ted for price re Index
t(RMB’ (RMB’0 ed Account Date
similar
0000) 000) amount
deals(
or not
%)
Other Companies
controlled by the Merchandis
Cash
Wazhou precision same controlling e Component Justice and Market
share holders and 150 0.55% 500 No Payment or None
Steel Ball Company Procureme s Equity price
the ultimate The Knot
nt
controlling party
Other Companies
controlled by the
Cash
Wazhou precision same controlling Sales of Goods and Justice and Market
3 0.04% 200 No Payment or None
Steel Ball Compan share holders and goods Materials Equity price
The Knot
the ultimate
controlling party
Other Companies
controlled by the
Cash
Wazhou precision same controlling Justice and
Land rent Land rent cost 10 0.62% 20 No Payment or None
Steel Ball Compan share holders and Equity
The Knot
the ultimate
controlling party
Other Companies
controlled by the
Cash
Wazhou precision same controlling Provide Heat Justice and Market
47 6.18% 150 No Payment or None
Steel Ball Compan share holders and Service treatment Equity price
The Knot
the ultimate
controlling party
Other Companies
controlled by the Merchandis
Cash
Wazhou precision same controlling e Component Justice and Market
11,139 40.93% 23,000 No Payment or None
forging Ltd. share holders and Procureme s Equity price
The Knot
the ultimate nt
controlling party
10
Wafangdian Bearing Company Limited 2018 Midyear Report
Other Companies
controlled by the
Cash
Wazhou precision same controlling Sales of Justice and Market
Materials 4,615 61.72% 6,000 No Payment or None
forging Ltd. share holders and goods Equity price
The Knot
the ultimate
controlling party
Other Companies
controlled by the
Cash
Wazhou precision same controlling Justice and Market
House rent House rent 52 3.26% 110 No Payment or None
forging Ltd. share holders and Equity price
The Knot
the ultimate
controlling party
Other Companies
controlled by the
Cash
Wazhou precision same controlling Justice and
Land rent Land rent cost 31 1.94% 80 No Payment or None
forging Ltd. share holders and Equity
The Knot
the ultimate
controlling party
Other Companies
controlled by the Merchandis
Dalian Wazhou Cash
same controlling e Component Justice and Market
Manufacturing 639 2.35% 1,500 No Payment or None
share holders and Procureme s Equity price
Equipment Co., Ltd The Knot
the ultimate nt
controlling party
Other Companies
controlled by the
Dalian Wazhou Cash
same controlling Goods Justice and Market
Manufacturing Product 1,600 No Payment or None
share holders and Procureme Equity price
Equipment Co., Ltd The Knot
the ultimate
controlling party
Other Companies
controlled by the
Dalian Wazhou Cash
same controlling Sales of Justice and Market
Manufacturing Materials 7 0.10% 130 No Payment or None
share holders and goods Equity price
Equipment Co., Ltd The Knot
the ultimate
controlling party
Dalian Wazhou Other Companies Merchandis Cash
Justice and Market
Manufacturing controlled by the e Machine 34 40.90% 500 No Payment or None
Equity price
Equipment Co., Ltd same controlling Procureme The Knot
11
Wafangdian Bearing Company Limited 2018 Midyear Report
share holders and nt
the ultimate
controlling party
Other Companies
controlled by the Heat
Dalian Wazhou Cash
same controlling Provide Justice and Market
Manufacturing treatment、 16 2.17% 35 No Payment or None
share holders and Service Equity price
Equipment Co., Ltd pickling The Knot
the ultimate
controlling party
Other Companies
Wazhou Group controlled by the Merchandis
Cash
precision same controlling e Justice and Market
Product 4,796 28.86% 14,000 No Payment or None
Transmission share holders and Procureme Equity price
The Knot
Bearing Co., Ltd the ultimate nt
controlling party
Other Companies
Wazhou Group controlled by the
Cash
precision same controlling Sales of Component Justice and Market
1,905 63.26% 6,000 No Payment or None
Transmission share holders and goods s Equity price
The Knot
Bearing Co., Ltd the ultimate
controlling party
Other Companies
Wazhou Group controlled by the
Cash
precision same controlling Sales of Justice and Market
Materials 184 2.46% 800 No Payment or None
Transmission share holders and Materials Equity price
The Knot
Bearing Co., Ltd the ultimate
controlling party
Other Companies
Wazhou Group controlled by the Heat Cash
precision same controlling Provide Justice and Market
treatment、 3 0.33% 10 No Payment or None
Transmission share holders and Service Equity price
pickling The Knot
Bearing Co., Ltd the ultimate
controlling party
Other Companies
Wazhou Group controlled by the
Cash
Precision special same controlling Justice and
Land rent Land rent Cost 4 0.28% 9 No Payment or None
Bearing Company share holders and Equity
The Knot
Limited the ultimate
controlling party
12
Wafangdian Bearing Company Limited 2018 Midyear Report
Other Companies
Wazhou Group controlled by the
Cash
Precision special same controlling Sales of Justice and Market
Materials 27 0.36% 100 No Payment or None
Bearing Company share holders and Materials Equity price
The Knot
Limited the ultimate
controlling party
Other Companies
Wazhou Group controlled by the
Cash
Precision special same controlling Machine Machine Justice and
Cost 3 No Payment or None
Bearing Company share holders and rent rent Equity
The Knot
Limited the ultimate
controlling party
Other Companies
Wazhou Group controlled by the
Cash
Precision special same controlling House House Justice and Market
26 1.62% 50 No Payment or None
Bearing Company share holders and rent rent Equity price
The Knot
Limited the ultimate
controlling party
Other Companies
Wazhou Group controlled by the
Cash
Precision special same controlling Provide Heat Justice and Market
34 4.54% 70 No Payment or None
Bearing Company share holders and Service treatment Equity price
The Knot
Limited the ultimate
controlling party
Other Companies
Wazhou Group controlled by the Merchandis
Cash
Precision special same controlling e Justice and Market
Product 5 0.03% 0 Yes Payment or None
Bearing Company share holders and Procureme Equity price
The Knot
Limited the ultimate nt
controlling party
Other Companies
Wazhou Group controlled by the
Machine Cash
Equipment technical same controlling Justice and Market
Procureme Machine 49 59.10% 1,000 No Payment or None
engineering share holders and Equity price
nt The Knot
Company Limited the ultimate
controlling party
Wafangdian Tongda Other Related Merchandis Cash
Justice and Market
Bearing party e Product 4,251 25.58% 9,000 No Payment or None
Equity price
Manufacturing Co., Procureme The Knot
13
Wafangdian Bearing Company Limited 2018 Midyear Report
Ltd nt
Wafangdian Tongda Other Related
Cash
Bearing party Sales of Justice and Market
Materials 69 0.92% 100 No Payment or None
Manufacturing Co., Materials Equity price
The Knot
Ltd
Wafangdian Tongda Other Related
Cash
Bearing party Sales of Justice and Market
Product 1,000 No Payment or None
Manufacturing Co., Product Equity price
The Knot
Ltd
Wafangdian Tongda Other Related Heat Cash
Bearing party Provide Justice and Market
treatment、 10 No Payment or None
Manufacturing Co., Service Equity price
pickling The Knot
Ltd
Merchandis
Da Lian Wazhou Other Related Cash
e Component Justice and Market
Fengyuan Machine party 4,695 17.25% 10,000 No Payment or None
Procureme s Equity price
Co.,Ltd The Knot
nt
Da Lian Wazhou Other Related Cash
House House Justice and Market
Fengyuan Machine party 5 0.34% 10 No Payment or None
rent rent Equity price
Co.,Ltd The Knot
Merchandis
Da Lian Wazhou Jin Other Related Cash
e Component Justice and Market
Zhou Machine party 786 2.89% 800 No Payment or None
Procureme s Equity price
Co.,Ltd The Knot
nt
Da Lian Wazhou Jin Other Related Cash
House House Justice and Market
Zhou Machine party 40 2.53% 80 No Payment or None
rent rent Equity price
Co.,Ltd The Knot
Da Lian Wazhou Jin Other Related Cash
Provide Heat Justice and Market
Zhou Machine party 7 0.91% 20 No Payment or None
Service treatment Equity price
Co.,Ltd The Knot
Other Companies
controlled by the
Cash
Wazhou group (USA) same controlling Sales of Justice and Market
Product 2,523 37.56% 10,000 No Payment or None
bearing co., LTD share holders and goods Equity price
The Knot
the ultimate
controlling party
Wazhou group Other Companies Merchandis Justice and Market Cash
Product 3,555 21.39% 20,000 No None
high-end automobile controlled by the e Equity price Payment or
14
Wafangdian Bearing Company Limited 2018 Midyear Report
bearing co., LTD same controlling Procureme The Knot
share holders and nt
the ultimate
controlling party
Other Companies
controlled by the
Wazhou group Cash
same controlling Sales of Justice and Market
high-end automobile Product 3,178 47.31% 5,000 No Payment or None
share holders and goods Equity price
bearing co., LTD The Knot
the ultimate
controlling party
Other Companies
controlled by the
Wazhou group Cash
same controlling Sales of Justice and Market
high-end automobile Materials 526 7.03% 1,000 No Payment or None
share holders and Materials Equity price
bearing co., LTD The Knot
the ultimate
controlling party
Other Companies
controlled by the
Wazhou group Cash
same controlling Sales of Component Justice and Market
high-end automobile 696 23.10% 2,000 No Payment or None
share holders and goods s Equity price
bearing co., LTD The Knot
the ultimate
controlling party
Other Companies
controlled by the
Wazhou group Cash
same controlling House House Justice and Market
high-end automobile 240 15.11% 700 No Payment or None
share holders and rent rent Equity price
bearing co., LTD The Knot
the ultimate
controlling party
Other Companies
controlled by the
Wazhou group Cash
same controlling Machine Machine Justice and
high-end automobile Cost 477 30.08% 1,200 No Payment or None
share holders and rent rent Equity
bearing co., LTD The Knot
the ultimate
controlling party
Other Companies
Wazhou group controlled by the Heat Cash
Provide Justice and Market
high-end automobile same controlling treatment、 20 2.59% 25 No Payment or None
Service Equity price
bearing co., LTD share holders and pickling The Knot
the ultimate
15
Wafangdian Bearing Company Limited 2018 Midyear Report
controlling party
Other Companies
controlled by the Merchandis
Wazhou Group Cash
same controlling e Component Justice and Market
Precision Roller 6,915 25.41% 10,000 No Payment or None
share holders and Procureme s Equity price
limited company The Knot
the ultimate nt
controlling party
Other Companies
controlled by the
Wazhou Group Cash
same controlling Sales of Component Justice and Market
Precision Roller 409 13.59% 600 No Payment or None
share holders and goods s Equity price
limited company The Knot
the ultimate
controlling party
Other Companies
controlled by the
Wazhou Group Cash
same controlling House House Justice and Market
Precision Roller 24 1.54% 50 No Payment or None
share holders and rent rent Equity price
limited company The Knot
the ultimate
controlling party
Other Companies
controlled by the
Wazhou Group Cash
same controlling Machine Machine Justice and
Precision Roller Cost 492 31.00% 1,100 No Payment or None
share holders and rent rent Equity
limited company The Knot
the ultimate
controlling party
Other Companies
controlled by the
Wazhou Group Cash
same controlling Justice and
Precision Roller Land rent Land rent Cost 10 0.65% 21 No Payment or None
share holders and Equity
limited company The Knot
the ultimate
controlling party
Other Companies
controlled by the
Wazhou Group Cash
same controlling Provide Heat Justice and Market
Precision Roller 629 83.28% 1,500 No Payment or None
share holders and Service treatment Equity price
limited company The Knot
the ultimate
controlling party
Wazhou Group Other Companies Sales of Merchandis Justice and Market Cash
2,033 27.19% 2,500 No None
Precision Roller controlled by the Merchandis e Equity price Payment or
16
Wafangdian Bearing Company Limited 2018 Midyear Report
limited company same controlling e The Knot
share holders and
the ultimate
controlling party
Other Companies
controlled by the Merchandis
Wazhou Group Cash
same controlling e Component Justice and Market
Precision Retainer 2,888 10.61% 6,000 No Payment or None
share holders and Procureme s Equity price
Limited Company The Knot
the ultimate nt
controlling party
Other Companies
controlled by the
Wazhou Group Sales of Cash
same controlling Merchandis Justice and Market
Precision Retainer Merchandis 3 0.05% 900 No Payment or None
share holders and e Equity price
Limited Company e The Knot
the ultimate
controlling party
Other Companies
controlled by the
Wazhou Group Cash
same controlling Machine Machine Justice and
Precision Retainer Cost 124 7.79% 250 No Payment or None
share holders and rent rent Equity
Limited Company The Knot
the ultimate
controlling party
Other Companies
controlled by the
Wazhou Group Cash
same controlling Justice and
Precision Retainer Land rent Land rent Cost 13 0.83% 26 No Payment or None
share holders and Equity
Limited Company The Knot
the ultimate
controlling party
Other Companies
controlled by the
Wazhou Group Cash
same controlling Sales of Component Justice and Market
Precision Retainer 2 0.06% 100 No Payment or None
share holders and goods s Equity price
Limited Company The Knot
the ultimate
controlling party
Other Companies
Wazhou Group controlled by the Cash
Justice and Market
Precision Retainer same controlling House rent House rent 38 2.41% 80 No Payment or None
Equity price
Limited Company share holders and The Knot
the ultimate
17
Wafangdian Bearing Company Limited 2018 Midyear Report
controlling party
Other Companies
controlled by the
Wazhou Group Heat Cash
same controlling Provide Justice and Market
Precision Retainer treatment、 5 No Payment or None
share holders and Service Equity price
Limited Company pickling The Knot
the ultimate
controlling party
Other Companies
Wazhou Group controlled by the Merchandis
Cash
same controlling e Justice and Market
Wind power Bearing Product 948 5.71% 2,200 No Payment or None
share holders and Procureme Equity price
Ltd The Knot
the ultimate nt
controlling party
Other Companies
Wazhou Group controlled by the
Cash
same controlling Sales of Justice and Market
Wind power Bearing Product 681 10.14% 5,000 No Payment or None
share holders and goods Equity price
Ltd The Knot
the ultimate
controlling party
Other Companies
Wazhou Group controlled by the
Sales of Cash
same controlling Merchandis Justice and Market
Wind power Bearing Merchandis 8 0.10% 700 No Payment or None
share holders and e Equity price
Ltd e The Knot
the ultimate
controlling party
Other Companies
controlled by the
Kugel- und Cash
same controlling Sales of Justice and Market
Rollenlagerwerk Product 335 4.99% 700 No Payment or None
share holders and Product Equity price
Leipzig GmbH The Knot
the ultimate
controlling party
Other Companies
controlled by the
Wafangdian bearing Power Cash
same controlling Justice and
Power Limited Procureme warter Cost 15 1.49% 20 No Payment or None
share holders and Equity
Company nt The Knot
the ultimate
controlling party
Wafangdian bearing Other Companies Power Justice and Cash
electrictity Cost 900 86.47% 1,800 No None
Power Limited controlled by the Procureme Equity Payment or
18
Wafangdian Bearing Company Limited 2018 Midyear Report
Company same controlling nt The Knot
share holders and
the ultimate
controlling party
Other Companies
controlled by the
Wafangdian bearing Power Govern Cash
same controlling Justice and
Power Limited Procureme heating ment 125 12.04% 400 No Payment or None
share holders and Equity
Company nt price The Knot
the ultimate
controlling party
Other Companies
Wazhou Group controlled by the
Technology Cash
Bearing Engineering same controlling Receive Justice and Agree
Developme 153 47.74% 800 No Payment or None
technology research share holders and Service Equity ment
nt Service The Knot
center the ultimate
controlling party
The controlling
Cash
share holders and Lease of Lease of Justice and Market
Wazhou Group 675 71.61% 1,500 No Payment or None
the ultimate Houses Houses Equity price
The Knot
controlling party
The controlling
Cash
share holders and Lease of Lease of Justice and
Wazhou Group Cost 124 13.19% 400 No Payment or None
the ultimate land land Equity
The Knot
controlling party
The controlling
Cash
share holders and Lease of Lease of Justice and
Wazhou Group Cost 143 15.20% 400 No Payment or None
the ultimate Houses manchine Equity
The Knot
controlling party
The controlling
Sales of Cash
share holders and Merchandis Justice and Market
Wazhou Group Merchandis 2 0.02% 30 No Payment or None
the ultimate e Equity price
e The Knot
controlling party
The controlling
Security Cash
share holders and Provide Justice and Agree
Wazhou Group and Fire 38 11.74% 250 No Payment or None
the ultimate Service Equity ment
Service The Knot
controlling party
The controlling Merchandis Cash
Justice and Agree
Wazhou Group share holders and e Product 3,062 18.43% 15,000 No Payment or None
Equity ment
the ultimate Procureme The Knot
19
Wafangdian Bearing Company Limited 2018 Midyear Report
controlling party nt
The controlling
Cash
share holders and Provide Justice and Agree
Wazhou Group Trademark 130 40.52% 900 No Payment or None
the ultimate Service Equity ment
The Knot
controlling party
170,04
total -- -- 65,763 -- -- -- -- -- --
4
Details of the rejection of the goods
non
already sold in big amount
In case the total amount of the regularrelated transaction incurred in
thereporting period has been predicted basedon categories, state the
non
actual
implementation of the in the reportingperiod (if any)
Cause of the big difference between the
transaction price and the market reference In-applicable
price. (if applicable)
20
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-yearal Report
2. Related transactions concerning acquisition and sales of assets or equity
Inapplicable
3. Related transactions concerning joint investment in foreign countries
Inapplicable
4. Current Associated Rights of Credit and Liabilities
Applicable
Whether there are non - operating related debt and debt transactionsInapplicable
Inapplicable
5. Other Major Related Transactions
Inapplicable
XIII. Non-operational Occupancy of the Company’s Capital by the Controlling Shareholder
and its Related Parties
Inapplicable
XIV. Important Contracts and Implementation
1. Custody, Contacting and Leases
(1) Custody
Inapplicable
(2) Contracting
Inapplicable
(3) Leases
.Related lease: this part of the contents of the twelve, related party transactions and related party
transactions 5 (3) related to the lease"
2. Significant Guarantees
Inapplicable
3. Other Major Contracts
Inapplicable
XV. Social Responsibility
By the end of 2018, the project of "implementing road lighting project to facilitate rural revitalization and
development" will be launched.
First,to rpair the broken street lamp for three vilages in Wafangdian city,they are Zhaokou village in
Wawo town, Tianjia vilage in yuantai town, and Panda village in Taiyang street, about 210 lamps in total,
which cost about 170,000 yuan.
Second,to set up an e-commerce and wechat business sales platform for the farmers who plant
Chinese herbal medicine and vegetable in the above three villages, conduct knowledge training on
e-commerce and wechat business, and broaden the sales channels.
XVI. Notes to Other Signficiant Events
Inapplicable
XVII. Significant Events of the Company’s Subsidiaries
Inapplicable
21
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-yearal Report
ChapterⅥ. Changes in Capital Stock and Shareholders
I. Changes in Capital Stock
Before Changes Changes in Shares After Changes
Conversi
New
Shares Ratio Bonus on of Othe Subtota Ratio
Shares Shares
Shares Reserves rs l
Issued
to Share
1.Non-tradable Shares 244,000,000 60.61% 244,000,000 60.61%
a. Promoters’ Shares 244,000,000 60.61% 244,000,000 60.61%
Including：State-owned
244,000,000 60.61% 244,000,000 60.61%
share
2.Tradable shares 158,600,000 39.39% 158,600,000 39.39%
b.B shares 158,600,000 39.39% 158,600,000 39.39%
3.Total 402,600,000 100% 402,600,000 100%
Reason of Changes of Shares
□Applicable √ Inapplicable
The basic situation of stock change.
□Applicable √ Inapplicable
The transfer of shares of
□Applicable √ Inapplicable
Influence from the shareholding movements upon such financial indicators as earnings per share, net
asset per
share of the latest year and the latest accounting period
□Applicable √ Inapplicable
Other information as the Company considers necessary to be disclosed or demanded by the securities
regulatory
authority for disclosing:
□Applicable √ Inapplicable
II. Issuing and Listing
III. Shareholders and Actual Controlling Shareholder
1. Number of Shareholders and Shares
Unit: Share
Total number of shareholder at the end Total number of shareholder at the end of report
6,622 0
of report period period with preferred stock
Shareholders with 5% or above Shares
Current Impawned or Frozen Shares
Ratio Total shares Increase or Non-current
shares
Name Nature Decrease in shares held
held
（%） held
hereportperiod
Status Amount
Wafangdian
State-owned 244,000,0
Bearing Group 60.61% 244,000,000
shareholder 00
Corporation
AKTIEBOLAGET Foreign
19.70% 79,300,000
SKF shareholder
Domestic
Huang Junyue 1.52% 6,108,058
shareholder
BOCI
Foreign
SECURITIES 1.46% 5,876,753
shareholder
LIMITED
Hu Xiaofeng Domestic 0.47% 1,879,277
22
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-yearal Report
shareholder
GUOTAI JUNAN
SECURITIES(HO Foreign
0.35% 1,427,606
NGKONG) shareholder
LIMITED
Domestic
Jin Yunhua 0.33% 1,311,256
shareholder
MerchantsSecuriti
State-owned
es Limited Hong 0.22% 886,101
shareholder
Kong Company
Domestic
Chen Haitao 0.19% 750,896
shareholder
MAN,KWAI WING Foreign private
0.18% 713,101
文贵荣 shareholder
Explanation for the Affiliated
Relations or United Action of the
Top Ten Shareholders
Notes to relationship or ―action in
There was no relationship and consistent activities between the first big shareholder and other
concert‖among the top ten
shareholders or the top ten common stock holders;
shareholders.
Top Ten Tradable Shareholders
Category of Shares
Name Current shares held at end of year
Categories Amount
AKTIEBOLAGET SKF 79,300,000 B 79,300,000
Huang Junyue 6,108,058 B 6,108,058
BOCI SECURITIES LIMITED 5,876,753 B 5,876,753
Hu Xiaofeng 1,879,277 B 1,879,277
GUOTAI JUNAN B
1,427,606 1,427,606
SECURITIES(HONGKONG) LIMITED
Jin Yunhua 1,311,256 B 1,311,256
MerchantsSecurities Limited Hong B
886,101 886,101
Kong Company
Chen Haitao 750,896 B 750,896
MAN,KWAI WING 文贵荣 713,101 B 713,101
Ma Yuancheng 596,966 B 596,966
Explanation for the Affiliated Relations There was no relationship and consistent activities between the first big shareholder and
or United Action of the Top Ten other shareholders or the top ten common stock holders; The relationship among other
Shareholders and the Top Ten Tradable shareholders, top ten circulation shareholders, top ten circulation shareholders and other
Shareholders shareholders was not clear.
IV Change of Controlling Shareholder Actual Controller in the Report Period
□ Applicable √ Inapplicable
ChapterⅦ. Relevant information about preferred stock
ChapterⅧ. Directors, Supervisors, Senior Management and Staff
I. Shares holding change in Directors, Supervisors, Senior Management
Inapplicable
II. Changes of Directors, Supervisors and Senior Management
23
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-yearal Report
Name Position Type Date Reason
Zhang Shiyin Vice-GM resignment 2018.04.20 Work change
Wang Jiyuan Vice-GM enage 2018.04.24 Work change
Sun Kun Independent Director elected 2018.05.18 Work change
Chapter VIII. Financial Report
I. Audit Report
The financial report is unaudited
II. Financial Statement
1. Consolidated Balance Sheet.
Unit: RMB Yuan
Item Closing Balance Opening Balance
Current assets ：
Monetary fund 185,921,246.44 82,860,774.83
Financial assets held-for-trading
Bills receivable 91,540,918.33 209,923,835.91
Account receivable 1,169,506,871.73 1,128,338,013.69
Account paid in advance 43,335,666.85 39,863,576.53
Interest receivable
Dividend reciivable
Other receivables 25,480,796.33 21,895,381.98
Inventory 712,471,443.43 693,836,428.55
Non-current assets due within 1 year
Other current assets 751,154.78 5,386,473.92
Total current assets 2,229,008,097.89 2,182,104,485.41
Non-current assets
Financial assets available-for-sale 2,567,033.30 2,000,000.00
Investments held-to-maturity
Long-term receivable
Long-term equity investment
Investment property 132,182,083.40 136,874,108.05
Fixed assets 665,943,050.67 710,247,969.72
Construction in progress 84,338,838.27 82,689,318.94
Construction materials
Fixed assets disposal
Biological assets
Gas and petrol assets
Intangible assets 87,309,293.26 87,530,122.26
Development expenditure
Goodwill
Long-term prepaid expense 638,384.96 700,228.04
Deferred tax assets 11,625,939.19 11,625,939.19
Other non-current assets
Total non-current assets 984,604,623.05 1,031,667,686.20
Total assets 3,213,612,720.94 3,213,772,171.61
Current liabilities
Short-term loan 615,000,000.00 648,000,000.00
Note payable 364,974,289.06 299,483,279.00
Accounts payable 679,399,393.32 630,832,287.45
24
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-yearal Report
Accounts received in advance 22,508,002.18 31,634,532.72
Commission charge payable
Accrued payroll 15,886,068.57 16,660,148.64
Tax payable 5,292,297.13 13,849,972.32
Interest payable 157,000.00 1,190,100.00
Dividends payable
Other payables 78,991,210.94 92,123,093.92
Non-current liabilities due within I year 50,000,000.00
Other current liabilities 3,967,022.53 3,967,022.53
Total current liabilities 1,786,175,283.73 1,787,740,436.58
Non-current liabilities
Long-term loan
Debenture payable
Long-term payables 1,597,305.72 1,597,305.72
Special payables 296,698.98 296,698.98
Contingent liabilities
Deferred income 35,846,493.62 37,754,771.56
Deferred tax liabilities 888,084.06 888,084.06
Other non-current liabilities
Total non-current liabilities 38,628,582.38 40,536,860.32
Total liabilities 1,824,803,866.11 1,828,277,296.90
Owner’s equity (shareholders’ equity)
Capital stock 402,600,000.00 402,600,000.00
Capital public reserves 485,691,050.47 485,691,050.47
Less: treasury share
Surplus reserve 134,278,527.26 134,278,527.26
Undistributed profit 366,239,277.10 362,925,296.98
Difference of foreign currency translation
Equity attributable to parent company 1,388,808,854.83 1,385,494,874.71
Minority interest
Total owner’s equity 1,388,808,854.83 1,385,494,874.71
Total owner’s equity and liabilities 3,213,612,720.94 3,213,772,171.61
Chairman: Meng Wei General Accountant : Sun Najuan Accounting charger: Sun Najuan
2. Balance Sheet of Parent Company
Unit: RMB Yuan
Item Opening Balance Closing Balance
Current assets ：
Monetary fund 181,513,599.84 78,901,032.57
Financial assets held-for-trading
Bills receivable 84,603,506.93 203,511,631.58
Account receivable 1,155,178,274.15 1,113,118,255.50
Account paid in advance 39,959,944.37 37,510,877.11
Interest receivable
Dividend receivable
Other receivables 24,464,781.40 20,605,278.47
Inventory 638,697,620.68 622,177,633.83
Non-current assets due within 1 year
Other current assets 667,466.88 4,067,326.65
Total current assets 2,125,085,194.25 2,079,892,035.71
Non-current assets
Financial assets available-for-sale 2,567,033.30 2,000,000.00
Investments held-to-maturity
Long-term receivable
Long-term equity investment 211,583,897.67 211,583,897.67
25
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-yearal Report
Investment property 115,693,914.39 119,890,581.55
Fixed assets 455,157,838.76 490,076,503.07
Construction in progress 83,579,490.38 82,374,150.54
Construction materials
Fixed assets disposal
Biological assets
Gas and petrol assets
Intangible assets 68,922,814.86 68,788,824.54
Development expenditure
Goodwill
Long-term prepaid expense 419,616.13 453,531.31
Deferred tax assets 10,350,000.00 10,350,000.00
Other non-current assets
Total non-current assets 948,274,605.49 985,517,488.68
Total assets 3,073,359,799.74 3,065,409,524.39
Current liabilities
Short-term loan 615,000,000.00 648,000,000.00
Note payable 364,974,289.06 299,483,279.00
Accounts payable 560,069,736.52 511,083,367.33
Accounts received in advance 24,138,755.36 31,518,509.16
Accrued payroll 9,130,569.50 9,803,431.58
Tax payable 2,267,810.54 10,821,733.56
Interest payable 157,000.00 1,190,100.00
Dividends payable
Other payables 40,540,079.69 52,910,305.81
Non-current liabilities due within I year 50,000,000.00
Other current liabilities 3,869,474.53 3,869,474.53
Total current liabilities 1,620,147,715.20 1,618,680,200.97
Non-current liabilities
Long-term loan
Debenture payable
Long-term payables
Special payables 296,698.98 296,698.98
Contingent liabilities
Deferred income 31,651,929.62 33,560,207.56
Deferred tax liabilities
Other non-current liabilities
Total non-current liabilities 31,948,628.60 33,856,906.54
Total liabilities 1,652,096,343.80 1,652,537,107.51
Owner’s equity (shareholders’ equity)
Capital stock 402,600,000.00 402,600,000.00
Capital public reserves 485,678,443.26 485,678,443.26
Less: treasury share
Surplus reserve 134,278,527.26 134,278,527.26
Undistributed profit 398,706,485.42 390,315,446.36
Total owner’s equity 1,421,263,455.94 1,412,872,416.88
Total owner’s equity and liabilities 3,073,359,799.74 3,065,409,524.39
3. Consolidated Income Sheet.
Unit: RMB Yuan
Item Account for the current period Account for the prior period
1.Total operating income 1,074,867,981.68 1,135,500,575.33
Including: Operating revenue 1,074,867,981.68 1,135,500,575.33
Interest income
Handling charge and commission income
26
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-yearal Report
2.Total operating cost 1,077,193,585.45 1,137,410,071.24
Including: Operating cost 939,746,571.13 1,004,195,641.99
Interest expenses
Handling charge and commission income
Tax & surcharges for main operations 8,592,102.92 9,832,448.15
Selling expenses 70,739,571.63 76,020,179.92
Administrative expense 34,075,703.49 31,245,721.82
Financial expense 24,052,423.13 16,016,268.75
Loss of impairment of assets -12,786.85 99,810.61
Add: Gains of assets sale (loss with"-") 243,495.82 7,398.46
Other income(loss with "-") 2,155,428.15 2,438,777.94
3.Operating profit (loss with"-") 73,320.20 536,680.49
Add: Non-operating revenue 3,147,204.28 2,269,265.97
Including:income on disposal of non-current assets
Less: Non-operating cost 185,971.17 172,310.91
Including: loss on disposal of non-current assets
4.Total profit(loss with"-") 3,034,553.31 2,633,635.55
Less: Income tax expenses -279,426.81
5. Net profit(Loss with"-") 3,313,980.12 2,633,635.55
Net profit attributable to shareholders of parent company 3,313,980.12 2,633,635.55
Minority interests
6. Other comprehensive returns
7. Total comprehensive returns 3,313,980.12 2,633,635.55
Total comprehensive returns available for parent company 3,313,980.12 2,633,635.55
Total comprehensive returns available for minority
shareholders
6.Earnings per share
(1) Basic earnings per share 0.008 0.007
(2) Diluted earnings per share 0.008 0.007
Chairman: Meng Wei General Accountant : Sun Najuan Accounting charger: Sun Najuan
4. Income Sheet of Parent Company.
Unit: RMB Yuan
Item Account for the current period Account for the prior period
1.Total operating income 1,055,959,948.67 1,121,747,641.74
Less:Operating cost 929,170,023.73 999,817,155.16
Tax & surcharges for main operations 7,127,550.36 8,636,001.96
Selling expenses 69,335,868.71 74,810,685.74
Administrative expense 22,927,138.05 18,388,929.30
Financial expense 18,377,173.41 16,060,266.15
Loss of impairment of assets -12,786.85 99,810.61
Add: Gains of assets sale (loss with"-") 243,495.82 36,648.46
Other income(loss with "-") 1,926,877.94 2,423,777.94
2.Operating profit (loss with"-") 11,205,355.02 6,395,219.22
Add: Non-operating revenue 2,761,588.64 1,918,805.14
Less: Non-operating cost 5,855,331.41 182,450.85
Including: loss on disposal of non-current assets
3.Total profit(loss with"-") 8,111,612.25 8,131,573.51
Less: Income tax expenses -279,426.81
4. Net profit(Loss with"-") 8,391,039.06 8,131,573.51
Net profit attributable to shareholders of parent company 8,391,039.06 8,131,573.51
Minority interests
5. Other comprehensive returns
6. Total comprehensive returns 8,391,039.06 8,131,573.51
7.Earnings per share
(1) Basic earnings per share 0.021 0.020
27
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-yearal Report
(2) Diluted earnings per share 0.021 0.020
5. Consolidated Cash Flow Statement.
Unit: RMB yuan
Item Account for the current period Account for the prior period
1.Cash from operating activities
Cash received from sale of goods or Provideing of services 473,793,646.35 512,413,730.92
Refund of taxes and fares
Other cash received relating to operating activities 914,421.41 1,373,744.39
Sub-total of cash inflows 474,708,067.76 513,787,475.31
Cash paid for goods and services 214,448,371.39 371,323,998.46
Cash paid to or on behalf of the employees 119,948,971.31 119,257,067.02
Tax payments 40,270,692.83 47,104,172.58
Other cash paid relating to operating activities 55,833,437.00 52,708,495.81
Sub-total of cash outflows 430,501,472.53 590,393,733.87
Net cash flows from operating activities 44,206,595.23 -76,606,258.56
2.Cash flows from investing activities
Cash received from return of investment
Cash received from investment incomes
Net cash received from disposal of fixed assets, intangible
1,251,120.00 4,885,900.00
assets and other long-term assets
Proceeds from sale of subsidiaries and other operating
units
Other cash received relating to investing activities
Sub-total of cash inflows 1,251,120.00 4,885,900.00
Cash paid to acquire fixed assets, intangible assets and
830,419.50 6,335,477.77
other long-term assets
Cash paid to acquire investment
Net cash used in acquiring subsidiaries and other operating
units
Other cash paid relating to investing activities
Sub-total of cash outflows 830,419.50 6,335,477.77
Net cash flows from investment activities 420,700.50 -1,449,577.77
3.Cash flows from financing activities
Cash received from absorbing investment
Including: Cash received from increase in minority interest
Proceeds from borrowings 90,000,000.00 223,000,000.00
Other proceeds relating to financing activities 328,905,975.40 321,721,729.99
Sub-total of cash inflows 418,905,975.40 544,721,729.99
Repayment of borrowings 182,064,872.18 208,000,000.00
Distribution of dividends or profits & interest expenses 15,666,321.40 15,240,108.89
Including: dividends or profit paid to minority interest
Cash paid for other financing activities 248,898,190.83 286,551,613.33
Sub-total of cash outflows 446,629,384.41 509,791,722.22
Net cash flows from financing activities -27,723,409.01 34,930,007.77
4. Effects of foreign exchange rate changes on cash -118,504.41 -491,746.17
5.Net increases in cash and cash equivalents 16,785,382.31 -43,617,574.73
Add: cash and cash equivalent, at the beginning of year 58,043,497.54 142,233,376.52
6.Cash and cash equivalent at the end of the year 74,828,879.85 98,615,801.79
6. Cash Flow Statement Of Parent Company.
Unit: RMB yuan
Item Account for the current period Account for the prior period
1.Cash from operating activities
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Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-yearal Report
Cash received from sale of goods or Providing of services 467,167,711.85 505,013,167.86
Refund of taxes and fares
Other cash received relating to operating activities 859,015.98 1,036,362.56
Sub-total of cash inflows 468,026,727.83 506,049,530.42
Cash paid for goods and services 242,795,410.65 386,834,924.59
Cash paid to or on behalf of the employees 95,982,327.94 93,936,635.19
Tax payments 34,029,224.90 39,398,824.49
Other cash paid relating to operating activities 51,488,741.86 48,664,314.64
Sub-total of cash outflows 424,295,705.35 568,834,698.91
Net cash flows from operating activities 43,731,022.48 -62,785,168.49
2.Cash flows from investing activities
Cash received from return of investment
Cash received from investment incomes
Net cash received from disposal of fixed assets, intangible
1,251,120.00 4,876,900.00
assets and other long-term assets
Proceeds from sale of subsidiaries and other operating units
Other cash received relating to investing activities
Sub-total of cash inflows 1,251,120.00 4,876,900.00
Cash paid to acquire fixed assets, intangible assets and other
803,269.50 6,308,049.77
long-term assets
Cash paid to acquire investment
Net cash used in acquiring subsidiaries and other operating
units
Other cash paid relating to investing activities
Sub-total of cash outflows 803,269.50 6,308,049.77
Net cash flows from investment activities 447,850.50 -1,431,149.77
3.Cash flows from financing activities
Cash received from absorbing investment
Including: Cash received from increase in minority interest
Proceeds from borrowings 90,000,000.00 223,000,000.00
Other proceeds relating to financing activities 328,905,975.40 321,721,729.99
Sub-total of cash inflows 418,905,975.40 544,721,729.99
Repayment of borrowings 182,064,872.18 208,000,000.00
Distribution of dividends or profits & interest expenses 15,665,802.99 15,237,696.69
Including: dividends or profit paid to minority interest
Cash paid for other financing activities 248,898,190.83 286,551,613.33
Sub-total of cash outflows 446,628,866.00 509,789,310.02
Net cash flows from financing activities -27,722,890.60 34,932,419.97
4. Effects of foreign exchange rate changes on cash -118,504.41 -491,746.17
5.Net increases in cash and cash equivalents 16,337,477.97 -29,775,644.46
Add: cash and cash equivalent, at the beginning of year 54,083,755.28 118,675,591.71
6.Cash and cash equivalent at the end of the year 70,421,233.25 88,899,947.25
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Wafangdian Bearing Co., Ltd（Wazhou B） 2016 Mid-year Report
7. Consolidated Sheet Of Changes In Shareholder’s Equity
Unit: RMB Yuan
Amount in current period
Owner‘s equity attributable to parent company Minority
Item
Capital Capital public less：treasure General provision shareholders‘ Owner‘s equity
Surplus public reserves Undistributed profits Others
stock reserves stock for risk equity
402,600,000
1.Balance at the end of last year 485,691,050.47 134,278,527.26 362,925,296.98 1,385,494,874.71
.00
Add: changes in accounting
policies
Changes in previous errors
Others
2.Balance at the beginning of 402,600,000
485,691,050.47 134,278,527.26 362,925,296.98 1,385,494,874.71
this year .00
3. The changes in this year
3,313,980.12 3,313,980.12
（decrease with―-‖）
（1）Total of comprehensive
3,313,980.12 3,313,980.12
income
（2）Capital contribution and
reduction
1）Ordinary share
2）Capital contributed by other
equity instrument holders
3）Share-based payments
charged to equity
4）Others
(4）Profits distribution
1)Provision for surplus public
reserves
2)provision for general risks
3)distribution for
owner(shareholders)
4)others
(5 ） interior transference of
owner‘s equity
1)capital (capital
30
Wafangdian Bearing Co., Ltd（Wazhou B） 2016 Mid-year Report
stock)transferred by the capital
public reserves
2)capital (capital
stock)transferred by the surplus
public reserves
3)loss offset by the surplus
public reserves
4)others
4. Balance at the end of the 402,600,000
485,691,050.47 134,278,527.26 366,239,277.10 1,388,808,854.83
current period .00
Unit: RMB yuan
Amount in previous period
Owner‘s equity attributable to parent company Minority
Item Capital Capital public less：treasure General provision shareholders‘ Owner‘s equity
Surplus public reserves Undistributed profits
stock reserves stock for risk equity
1.Balance at the end of last 402,600,000
485,691,050.47 131,442,909.11 359,603,965.97 1,379,337,925.55
year .00
Add: changes in accounting
policies
Changes in previous errors
Others
2.Balance at the beginning of 402,600,000
485,691,050.47 131,442,909.11 359,603,965.97 1,379,337,925.55
this year .00
3. The changes in this year
2,835,618.15 3,321,331.01 6,156,949.16
（decrease with―-‖）
（1）Total of comprehensive
10,182,949.16 10,182,949.16
income
（2）Capital contribution and
reduction
1）Ordinary share
2）Capital contributed by other
equity instrument holders
3）Share-based payments
charged to equity
4）Others
(4）Profits distribution 2,835,618.15 -6,861,618.15 -4,026,000.00
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Wafangdian Bearing Co., Ltd（Wazhou B） 2016 Mid-year Report
1)Provision for surplus public
2,835,618.15 -2,835,618.15
reserves
2)provision for general risks
3)distribution for
owner(shareholders)
4)others
(5）interior transference of
owner‘s equity
1)capital (capital
stock)transferred by the capital
public reserves
2)capital (capital
stock)transferred by the surplus
public reserves
3)loss offset by the surplus
public reserves
4)others
4. Balance at the end of the 402,600,000
485,691,050.47 134,278,527.26 362,925,296.98 1,385,494,874.71
current period .00
8. Sheet Of Changes In Shareholder’s Equity Of Parent Compamy.
Unit: RMB yuan
Amount in current period
Item Capital public Surplus public reserves
Capital stock less：treasure stock Undistributed profits Owner‘s equity
reserves
1.Balance at the end of last year 402,600,000.00 485,678,443.26 134,278,527.26 390,315,446.36 1,412,872,416.88
Add: changes in accounting
policies
Changes in previous errors
Others
2.Balance at the beginning of
402,600,000.00 485,678,443.26 134,278,527.26 390,315,446.36 1,412,872,416.88
this year
3. The changes in this year
8,391,039.06 8,391,039.06
（decrease with―-‖）
（1）Total of comprehensive
8,391,039.06 8,391,039.06
income
（2）Capital contribution and
reduction
32
Wafangdian Bearing Co., Ltd（Wazhou B） 2016 Mid-year Report
1）Ordinary share
2）Capital contributed by other
equity instrument holders
3）Share-based payments
charged to equity
4）Others
(4）Profits distribution
1)Provision for surplus public
reserves
2)provision for general risks
3)distribution for
owner(shareholders)
4)others
(5 ） interior transference of
owner‘s equity
1)capital (capital
stock)transferred by the capital
public reserves
2)capital (capital
stock)transferred by the surplus
public reserves
3)loss offset by the surplus
public reserves
4)others
4. Balance at the end of the
402,600,000.00 485,678,443.26 134,278,527.26 398,706,485.42 1,421,263,455.94
current period
Unit: RMB yuan
Amount in previous period
Item Capital stock Capital public reserves less：treasure stock Surplus public reserves Undistributed profits Owner‘s equity
1.Balance at the end of last
402,600,000.00 485,678,443.26 131,442,909.11 368,820,883.02 1,388,542,235.39
year
Add: changes in accounting
policies
Changes in previous errors
Others
2.Balance at the beginning of
402,600,000.00 485,678,443.26 131,442,909.11 368,820,883.02 1,388,542,235.39
this year
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Wafangdian Bearing Co., Ltd（Wazhou B） 2016 Mid-year Report
3. The changes in this year
2,835,618.15 21,494,563.34 24,330,181.49
（decrease with―-‖）
（1）Total of comprehensive
28,356,181.49 28,356,181.49
income
（2）Capital contribution and
reduction
1）Ordinary share
2）Capital contributed by other
equity instrument holders
3）Share-based payments
charged to equity
4）Others
(4）Profits distribution 2,835,618.15 -6,861,618.15 -4,026,000.00
1)Provision for surplus public
2,835,618.15 -2,835,618.15
reserves
2)provision for general risks -4,026,000.00 -4,026,000.00
3)distribution for
owner(shareholders)
4)others
(5 ） interior transference of
owner‘s equity
1)capital (capital
stock)transferred by the capital
public reserves
2)capital (capital
stock)transferred by the surplus
public reserves
3)loss offset by the surplus
public reserves
4)others
4. Balance at the end of the
402,600,000.00 485,678,443.26 134,278,527.26 390,315,446.36 1,412,872,416.88
current period
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Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
III. 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 16 July, 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 19February, 1997.
The parent company is Wazhou Group. General shareholders meeting is the company‘s authority and have the resolution
power over company‘s business policy, financing, investment and profit appropriation etc.significant events in accordance
with relevant law. Board of directors is responsible for general meeting and has the power over the company‘s decision
making. Management is in charge of implementation of resolution made by general meeting and board meeting and is
responsible for operation management. The company has the following functional departments including: procurement
department, portfolio investment department, operating department, HR, marketing department, manufacturing and
construction department, quality control department, financial department and logistic department. Wholly owned subsidiaries
include Wazhou Liaoyang Bearing Manufacturing Co., Ltd(―Liaoyang Bearing‖), Dalian Wazhou Precision Electric Motor Car
Bearing (―DalianElectrical Motor‖),and Wazhou Precision of Spherical Roller Bearings(Wafangdian)Co., Ltd(―Spherical
Bearings‖).
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.Legal representative is Meng Wei.
The Company is principally engaged in the manufacturing and sale of bearing, bearing spare parts, engineering equipment,
automobile spare parts and relating products, bearing repair, maintenance and technology service etc and also in renting
mechanical equipment and estate, inspection of bearings, mechanical equipment, measuring instruments and meters.
IV. Basis for the preparation of financial statements
1 Basis for the preparation of financial statements
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‘.
V. Significant accounting policies, accounting estimates and method for preparation of consolidated financial
statements
1 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.
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Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
2 Accounting period
The Group adopts the Gregorian calendar year as accounting period, i.e. from Jan 1 to Dec 31.
3.Operating cycle
Normal operating cycle refers to the duration from purchasing the assets for manufactuing up to cash or cash
equivelant realisation. The group sets twelve months for one operating cycle and as the liquidity criterion for
assets and liability.
4 Funcitonal currency
The Group adopts RMB as functional currency.
5 Recording basis and pricing principle
The accrual basis shall be adopted for accounting treatment to follow the historical cost method, except that the financial
assets held for trading and sale are measured at fair value.
6 Business combination
Business combination refers to transaction or event bringing together two or more separate enterprises into one reporting
entity. The Group should recognize the acquired assets and liabilities at the combining date or acquisition date. The
combining date or acquisition date is the date when the Group acquired actually acquiree and combined party.
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.
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.
7 Method of preparation of consolidated financial statements
(1) Recognition principle of scope of consolidation
Scope of consolidated financial statements should include all subsidiaries of the parent and the special purpose entities.
(2) 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.
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Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
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.
8 Cash and cash equivalent
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.
9 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.
37
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
10 Financial assets and financial liabilities
(1) Financial assets
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
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.
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Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
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.
3) Impairment of financial assets
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 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)Derecognizing of financial assets
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.
(2) Financial liabilities
39
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
The financial liabilities are classified into the financial liability at fair value through profit or loss and other financial liability for
the initial recognition.
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) Fair value measurement of financial assets and liabilities
a) If the market for a financial instrument is active, an entity establishes fair value by using the quoted price in the active
market. In the active market, the Group measures 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 liabilities by using the current 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 liabilities.
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.
11 Accord receivables
(1) Individually significant amounts of accounts receivable accrued bad debt provision as per portfolio
Judgment basis or amount standards of The receivables with more than RMB 3 million individual amount shall be
individually significant amounts recognized as the significant receivables;
The accruing method of the receivables with The bad debt provisions shall be accrued based on the difference
individually significant amounts between current value of future cash flow and the carrying amounts.
(2) Accounts receivable accrued bad debt provision by portfolio
The basis of portfolio
Use the accounting aging of the receivables as the credit risk characteristics
Accounting aging
to classify the portfolio
Use the amount characteristics of the receivables , if the transaction party
Related parties
is related parties characteristics need to classify the portfolio
Use the amount characteristics of the receivables, the credit of transaction
Risk-free party, the nature of the amounts and the safeguard mechanism of
transaction as characteristics to classify the portfolio
1) The percentage of provision for bad debts based on the age of receivables as followings:
Accounting aging Accrual percentage of the Accrual percentage of other receivables (%)
receivables (%)
Within 1 year 1 1
1-2 years 5 5
2-3 years 20 20
40
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
Over 3 years 50 50
Related parties Accrue the bad debt provision by individual identification method
Risk-free Accrue the bad debt provision by individual identification method
2) The other methods is applied to actuating of bad debts provision
(3) Individually insignificant amount accounts receivable but accrued bad debt provision as per portfolio
The individual amount is not significant, but the accrued bad debt
Accrual reason
provision on the basis of portfolio can not reflect its risk characteristic
The bad debt provisions should be accrued based on the difference
Accrual method
between current value of future cash flow and the carrying amount.
12 Inventories
Classification of inventory: Inventories are classified as raw material, wrappage, low-valuable consumable,
working-in-progress, and finished goods etc.
Pricing of inventories received and sent out: The inventories are processed on perpetual inventory system, purchased and
stored based on their standard cost. The raw materials are priced daily on their standard costs. The differences between the
standard and actual costs is recorded into the costs of materials and for sending out according to proportion of storage and
sending out of materials, and adjust the planned costs of raw material into actual costs. The working-in-progress finished
goods are priced on their standard costs; the differences between the standard and actual costs are recorded into the costs of
working-in-progress and finished goods according to the receiving and sending out proportion, and finaly adjust the planned
costs into actual costs.
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.
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.
13.Long-term equity investment
41
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
Long-term equity investments include the equity investments which the Group can control, joint control or have significant
influence on the investee, or the Group can not control, joint control or significant influence on the investee and there is no
offer in the active market, fair value can not be reliably measured.
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.
The initial cost of long term equity investments formed in the merger of enterprise under the same control shall be recognized
at 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.
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.
14 Investment property
42
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
Investment property of the Company includes land and property. Cost model is adpoted.
Investment property is depreciated or amortized under straight line method. Estimated net residual value rate, useful life,
depreciation rate as follows:
Estimated
Useful life net residual Annual
Category
(years) value rate depreciation rate
(%)
Use right of land 40 8.33%
Including: Buildings 15 3 6.47%
Housing for production 30 3 3.23%
Housing for non-production 35 3 2.77%
15.Fixed asset
(1)Recognition criteria
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 RMB2,000.
Fixed assets shall be recognized when the economic benefit probably flows into the Group and its cost can be
measured reliably. Fixed assets include: building, machinery, transportation equipment, electronic equipment and
others.:
(2)Depreciation method
Estimated net
Useful
Category residual value Annual depreciation rate
life(years)
rate (%)
Housing and Buildings
Including: Buildings 15 3 6.47
Housing for productive 30 3 3.23
Housing for non-productive 35 3 2.77
Machinery equipments 10-15 3 6.47～9.70
Transportation equipments 6 3 16.17
Electronic equipments
Including: Computer 4 3 24.25
General testing instruments 7 3 13.86
Specialized electronic equipments 8 3 12.13
Automated controlling equipments 8 3 12.13
Automated controlling meters 8 3 12.13
Others equipments
43
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
Including: Industrial kiln 7 3 13.86
Tools & other production tools 9 3 10.78
Transmission equipments 15 3 6.47
Non-operational equipments and tools 18 3 5.39
16 Construction in progress
Measurement of CIP: Construction-in-progress is recognized at actual cost. Self-construction project is recognized at the cost
of material, labour cost and construction expenses. Contractual construction is recognized at project price which should be
paid. Installed construction is recognized at the value of equipment, installation and assembly cost. Besides above, the cost
of CIP comprises borrowing cost and profit and loss resulting from foreign exchange.
17 Borrowing costs
Recognition principles on capitalization 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.
Duration of capitalization 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 capitalization of borrowing costs as part of the cost of
a qualifying asset should commence. Capitalization 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.
18 Intangible assets
Measurement of intangible assets: The intangible assets of the Group refer to land use right, ERP system software. The cost
of outsourcing intangible assets 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.
Amortization method and period: The Group shall amortize 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 amortized 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.
19 Impairment of non-financial asset
44
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
The Group checks the long-term equity investment for its subsidiaries, association and joint venture, fixed asset,
construction-in-progress, intangible asset and others on each balance sheet date. There may be an impairment of asset when
one of following indications occurs. The Group should test impairments. The Group tests the impairment of goodwill,
intangible asset with uncertain useful life on the end of every year. When it is difficult to measure the recoverable amount of
asset, it should measure the recoverable amount of asset on the basis of asset group.
After impairment test, if the book value exceeds the recoverable amount of the asset, the difference should be recognized as
impairment loss. Once any loss of impairment is recognized, it shall not be reversed in the future accounting periods. The
recoverable amount of asset refers to the higher one of the net amount of the fair value of asset minus disposal expense and
the present value of estimated future cash flow of asset.
20 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.
21 Employee benefits
Employee compensation comprises short-term benefit, post-employment benefit, termination benefit and other long-term
employee‘s benefit.
Employee‘s payables include salary, bonus, allowance, welfare, social insurance, housing funds, labour union expense, staff
training expense,during the period in which the service rendered by the employees, the actually incurred short term employee
benefits shall be recognized as liability and shall be recognized in P&L or related cost of assets based on benefit objective
allocated from the service rendered by employees.
Post-employment benefits include the basic pension schemeand unemployment insurance etc. Based on the risk and
obligation borne by the Group, post-employment benefits are classified into defined contribution plan and defined benefit
plan.For defined contribution plan, liability shall be recognized based on the contributed amount made by the Group to
separate entity at the balance sheet date in exchange of employee service for the period and it shall be recorded into current
profit and loss account or relevant cost of assets in accordance with beneficial objective.
Termination benefits are employee benefits payable as a result of either an entity‘s decision to terminate an employee‘s
employment before the contract due date or an employee‘s decision to accept voluntary redundancy in exchange for those
benefits. An entity shall recognize the termination benefits as a liability and an expense at the earlier date when the entity
cannot unilateral withdraw the termination benefits due to employment termination plan or due to redundancy suggestion, or
when the entity can recognize the restricting cost or expense arising from paying termination benefits. For the termination
benefits that will not be expected to be fully paid within twelve months after the end of the reporting period, it shall be
accounted as other long-term employee benefit. For employee internally retired informally, termination benefits accounting
shall be applied. The Group shall recognized the planned wages and social insurance of retired employee in the current profit
and loss account when provision conditions are met, for the period since the termination of employee service rendered until
the formal retirement date.(termination benefit).
45
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
Other long-term employee benefit provided by the Group, shall be accounted for as defined contribution plan if the defined
contribution plan are met, otherwise shall be accounted for as defined benefit plan.
22 Contingent liabilities
The obligation pertinent to a contingency shall be recognized as an estimated debt when the following conditions are satisfied
simultaneously:
(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.
23 Principle of recognition of revenue
The revenue of the Group is mainly from selling goods, providing labour services and abalienating the right of use assets.
Recognition standards for revenue are as below:
(1) Recognition of revenue from selling good:
1) The significant risks and rewards of ownership of the goods have been transferred to the buyer;
2) The Group remains neither continuous management right that usually keeps relation with the ownership nor effective
control over the sold goods;
3) The amount of revenues can be measured reliably;
4) The relevant economic benefits are likely to flow into the Group; and
5) The incurred cost or intended cost can be measured reliably.
(2) Recognition of revenue from providing labour services:
1) Total revenue and total cost can be measured reliably; the relevant economic benefits are likely to flow into the Group; and
the stage of completion can be confirmed reliably;
2) If the Group can, on the date of the balance sheet day, reliably estimate the outcome of a transaction concerning the
labour services it provides, it shall recognize the revenue from providing services employing the stage of completion method.
If the outcome can not be estimated reliably and incurred cost can be offset, the revenue should be recognised by the
compensation. When the standards can not be satisfied, the revenue should not be recognised, and the incurred cost should
be recorded into the current profit and loss.
46
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
(3) Revenue from abalienating the use right of use assets
The revenue from abalienating of use right of assets shall be recognized, when the relevant economic benefits are likely to
flow into the Group, and the amount of revenues can be measured reliably.
24 Government grants
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.
25 Deferred tax assets and 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 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.
26 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.
VI Accounting treatment method of income tax
1. The main applicable tax and rate to the Group as follows:
Tax Tax base Tax rate
47
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
Value-added tax (VAT) Sales revenue or Purchase 17%,13%,11%,6%,3%
Business tax Revenue from property lease, examination fee, surcharge 5%
City construction tax Value-added tax payables, business tax 7%
Education surcharge Value-added tax payables, business tax 3%
Local education surcharge Value-added tax payables, business tax 2%
Enterprise income tax(EIT) Current period taxable profit 15%
70% of cost of own property or revenue from leasing
Real estate tax 1.2% or 12%
property
Land use tax Land using right area RMB 6 per square meter
Notes for tax principles with different EIT rate
Tax principles EIT rate
Wazhou Liaoyang Bearing construction Co.,Ltd 25%
Dalian Wazhou Precision Motor Car Bearing Company Limited 25%
Wazhou Precision of Spherical Roller Bearings(Wafangdian)Co., Ltd 25%
2. Tax preference
The company obtained the qualification of high and new technology enterprises at 29September, 2014.The Certificate
No is GF201421200004, and the validity duration is three years. According to the tax law, the company can be granted for
the preferential tax policy of enterprise income tax rate of 15% in three years.
VI. Taxation
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%，13%，11%，6%，3%
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%
Education surcharge Value-added tax payables, business tax 3%
Local education surcharge Value-added tax payables, business tax 2%
70% of cost of own property or revenue from
Real estate tax 1.2% or 12%
leasing property
Land use tax Land using right area RMB 6 per square meter
Notes for tax principles with different EIT rate
Tax principles EIT rate
Wazhou Liaoyang Bearing construction Co.,Ltd 25%
Dalian Wazhou Precision Motor Car Bearing Company Limited 25%
Wazhou Precision of Spherical Roller Bearings(Wafangdian)Co., Ltd 25%
48
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
2. Tax preference and approval
The company obtained the qualification of high and new technology enterprises at 29 November, 2017.The Certificate No is
GR201721200199, and the validity duration is five years. According to the tax law, the company can be granted for the
preferential tax policy of enterprise income tax rate of 15% in three years.
VII. Notes to consolidated financial statements
1. Cash and cash in bank
Item Closing Balance Opening Balance
Cash on hand 54,564.16 39,497.23
Cash in bank 74,774,315.69 58,004,000.31
Other cash and cash equivalents 111,092,366.59 24,817,277.29
Total 185,921,246.44 82,860,774.83
2 Notes receivable
(1) Category of notes receivable
Items 2018.07.30 2017.12.31
Bank acceptance notes 52,583,316.24 113,596,871.36
Commercial acceptance notes 38,957,602.09 96,326,964.55
Total 91,540,918.33 209,923,835.91
3 Accounts receivable
(1) Category of accounts receivable
Closing Balance
Items Booking balance Provision
Booking balance
Amount % Amount %
Accountsreceivable with
individual significant amount and
5,092,669.00 0.41% 5,092,669.00 100.00%
identification separately bad debt
provision
Accounts receivable identified
bad debt provision based on the 1,210,873,018.25 97.38% 41,366,146.52 4.27% 1,169,506,871.73
characters of credit risk portfolio
Accountsreceivable with
individual insignificant amount
27,541,279.51 2.21% 27,541,279.51 100.00%
and identification separately bad
debt provision
Total 1,243,506,966.76 100.00% 74,000,095.03 1,169,506,871.73
(Continued)
Opening balance
Items Booking balance Provision
Booking balance
Amount % Amount %
Accountsreceivable with
individual significant amount and 5,092,669.00 0.42% 5,092,669.00 100.00%
identification separately bad debt
49
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
provision
Accounts receivable identified
bad debt provision based on the 1,170,649,399.63 97.29% 42,311,385.94 4.79% 1,128,338,013.69
characters of credit risk portfolio
Accountsreceivable with
individual insignificant amount
27,541,279.51 2.29% 27,541,279.51 100.00%
and identification separately bad
debt provision
Total 1,203,283,348.14 100.00% 74,945,334.45 1,128,338,013.69
Accounts receivable accrued the bad debt provisions under accounting aging analysis method
Closing Balance
Aging Accounts Proportion
Provision for bad debts
receivable (%)
Within1 year 743,446,853.86 7,434,468.53 1.00%
1 to 2 years 148,770,792.90 7,438,539.65 5.00%
2 to 3 years 37,569,560.80 7,513,912.16 20.00%
Over 3 years 37,958,452.35 18,979,226.18 50.00%
Total 967,745,659.91 41,366,146.52
4 Advances to suppliers
(1) Aging of advances to suppliers
Items 2018.06.30 2017.12.31
Amount Percentage (%) Amount Percentage (%)
Within 1 year 30,289,202.64 69.89% 36,499,031.46 91.56%
1 to 2 years 12,152,505.50 28.04% 3,085,092.20 7.74%
2 to 3 years 531,192.28 1.23% 205,543.10 0.52%
Over 3 years 362,766.43 0.84% 73,909.77 0.18%
Total 43,335,666.85 -- 39,863,576.53 --
5. Dividends receivable
6 Other receivables
(1) The categories of other receivable
Closing Balance
Items Booking balance Provision
Booking balance
Amount % Amount %
Other receivables identified
bad debt provision based on
26,749,629.22 82.91% 1,268,832.89 8.70% 25,480,796.33
the characters of credit risk
portfolio
Accountsreceivable with
individual insignificant 5,513,140.92 17.09% 5,513,140.92 100.00%
amount and identification
50
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
separately bad debt
provision
Total 32,262,770.14 100.00% 6,781,973.81 25,480,796.33
(Continued)
Opening Balance
Provision Booking
Items Booking balance
balance
Amount % Amount %
Other receivables identified bad
debt provision based on the 23,164,214.87 80.78% 1,268,832.89 9.28% 21,895,381.98
characters of credit risk portfolio
Accountsreceivable with individual
insignificant amount and
5,513,140.92 19.22% 5,513,140.92 100.00%
identification separately bad debt
provision
Total 28,677,355.79 100.00% 6,781,973.81 21,895,381.98
(2) Other receivables accrued the bad debt provisions under accounting aging analysis method
Closing Balance
Aging Provision for bad Proportion
Other receivables
debts (%)
Within 1 year 6,962,467.41 69,624.67 1.00%
1-2 years 5,696,876.91 284,843.85 5.00%
2-3 years 165,641.74 33,128.35 20.00%
Over 3 years 1,762,472.04 881,236.02 50.00%
Total 14,587,458.10 1,268,832.89
(3) Other receivables categorized by nature
Nature Closing Balance Opening Balance
Other receivables 32,262,770.14 28,677,355.79
Total 32,262,770.14 28,677,355.79
7 Inventories
(1) Categories of inventories
2018.06.30 2017.12.31
Item Provision for Provision for
Cost Net book value Cost Net book value
decline declines
Raw materials 80,566,678.10 910,648.85 79,656,029.25 56,740,605.63 910,648.85 55,829,956.78
Finished
523,949,536.64 36,265,289.07 487,684,247.57 512,690,931.09 36,265,289.07 476,425,642.02
goods
Workingin
144,947,091.68 144,947,091.68 155,827,415.78 155,827,415.78
progress
51
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
Low value
184,074.93 184,074.93 5,753,413.97 5,753,413.97
consumables
Total 749,647,381.35 37,175,937.92 712,471,443.43 731,012,366.47 37,175,937.92 693,836,428.55
(2) Provision for decline in the value of inventories
Item Increase Decrease Closing Balance
Opening Balance Reverse/ Others
Accrual Other
Written- off transferred
Raw materials 910,648.85 910,648.85
Finished goods 36,265,289.07 36,265,289.07
Total 37,175,937.92 37,175,937.92
8 Other current assets
Item 2018.06.30 2017.12.31
VAT to be deducted 751,154.78 3,531,136.36
Prepaid income tax 1,855,337.56
Total 751,154.78 5,386,473.92
9. Available-for-sale financial assets
(1) Available-for-sale financial assets
Item Closing Balance Opening Balance
Booking balance Provision Book value Booking balance Provision Book value
Available-for-sale
2,567,033.30 2,567,033.30 2,000,000.00 2,000,000.00
equity instruments
Measured as cost
2,567,033.30 2,567,033.30 2,000,000.00 2,000,000.00
method
Total 2,567,033.30 2,567,033.30 2,000,000.00 2,000,000.00
10 Investment property
Item Property Land use right Total
I. Initial Cost 173,119,534.89 51,969,186.22 225,088,721.11
1. Opening Balance -
2. Increase
(1) Purchase
(2) Transferred from FA
3. Decrease
(1) Disposal
(2)Transfer to others
4. Closing Balance 173,119,534.89 51,969,186.22 225,088,721.11
II. Accumulated Depreciation
1. Opening Balance 75,125,524.13 13,089,088.93 88,214,613.06
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Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
Item Property Land use right Total
2. Increase 2,743,203.90 1,948,820.75 4,692,024.65
(1)Accrued
3. Decrease
(1) Disposal
(2)Transfer to others
4. Closing Balance 77,868,728.03 15,037,909.68 92,906,637.71
III. Impairment Reserve -
1. Opening Balance -
2. Increase -
3. Decrease
(1) Disposal
(2)Transfer to others
4. Closing Balance
IV. Book Value
1. Closing book value 95,250,806.86 36,931,276.54 132,182,083.40
2. Opening book value 97,994,010.76 38,880,097.29 136,874,108.05
11 Fixed assets
(1) Fixed assets by categories
Machinery Electronic Other
Item Building Transportation Device Equipment Total
Equipment
1. Initial Cost
199,245,477.0 1,706,827,814.9
(1) Opening Balance 253,663,547.33 1,164,347,666.68 17,533,982.52 72,037,141.35
6 4
(2) Increase 16,078.54 2,640,459.26 0.00 1,096,104.00 171,966.81 3,924,608.61
1) Purchase 10,180.18 748,114.70 547,090.44 171,722.32 1,477,107.64
2) Transferred from
5,898.36 1,892,344.56 549,013.56 244.49 2,447,500.97
construction-in-progress
3) Acquired from
business combination
(3) Decrease 24,410.26 323,582.96 689,162.92 1,037,156.14
1) Disposal 24,410.26 323,582.96 689,162.92 1,037,156.14
199,417,443.8 1,709,715,267.4
(4) Closing Balance 253,679,625.87 1,166,963,715.68 17,210,399.56 72,444,082.43
7 1
2.Accumulated
Depreciation
139,385,508.1
(1) Opening Balance 146,076,825.72 644,284,826.15 13,394,879.03 53,181,861.81 996,323,900.90
9
(2) Increase 4,172,514.79 37,194,966.96 463,037.51 2,109,494.92 4,166,373.45 48,106,387.62
1)Accrued 4,172,514.79 37,194,966.96 463,037.51 2,109,494.92 4,166,373.45 48,106,387.62
53
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
2) Other transfer
(3) Decrease 395.26 296,777.11 616,843.73 914,016.10
1) Disposal 395.26 296,777.11 616,843.73 914,016.10
143,551,881.6 1,043,516,272.4
4) Closing Balance 150,249,340.51 681,479,397.85 13,561,139.43 54,674,513.00
4 2
3. Impairment Reserve
(1) Opening Balance 255,944.32 255,944.32
(2) Increase
(3) Decrease
1) Disposal
(4) Closing Balance 255,944.32 255,944.32
4. Book Value
1. Closing book value 103,430,285.36 485,228,373.52 3,649,260.13 17,769,569.43 55,865,562.23 665,943,050.67
2. Opening book value 107,586,721.61 519,806,896.21 4,139,103.49 18,855,279.54 59,859,968.87 710,247,969.72
12 Construction in progress
(1) Details of Construction-in-progress
Closing Balance Opening Balance
Item
Book Balance Provision Book Balance Provision
Improvement of
seven-finished 30,739,383.45 30,739,383.45 30,689,629.52 30,689,629.52
products
Improvement of
one-finished 92,820.85 92,820.85 92,820.85 92,820.85
products
Dalian industry park
1,923,068.10 1,923,068.10 1,922,211.42 1,922,211.42
project
Improvement of
precision roller 10,634,263.21 10,634,263.21 11,340,473.99 11,340,473.99
branch
Improvement of
1,960,849.25 1,960,849.25 1,960,571.95 1,960,571.95
grinding machine
Improvement of
3,620,644.45 3,620,644.45 3,703,419.57 3,703,419.57
plant
Improvement of
11,873,079.37 11,873,079.37 10,195,223.88 10,195,223.88
railway
Improvement of
414,933.76 414,933.76 414,391.36 414,391.36
grinding machine
Improvement of
second-finished 1,483,761.06 1,483,761.06 1,483,761.06 1,483,761.06
products
Crane Project 2,735,507.63 2,735,507.63 2,734,957.91 2,734,957.91
Improvement of
2,220,709.81 2,220,709.81 2,220,662.31 2,220,662.31
special large branch
Computer Project 2,081,977.04 2,081,977.04 2,081,977.04 2,081,977.04
Overhaul factory
225,914.81 225,914.81 472,585.86 472,585.86
reconstruction
Heat treatment
160,940.46 160,940.46 160,551.84 160,551.84
product line
Automobile 1,016,610.51 1,016,610.51
54
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
improvement
Superfine machine
1,291,421.97 1,291,421.97
installation project
Overhaul of bainite
846,153.80 846,153.80
furnace
Refrigerated air
7,863.25 7,863.25 7,863.25 7,863.25
Dryer System
Three ton battery
192,307.70 192,307.70 192,307.70 192,307.70
fork truck
Sewage treatment
94,017.09 94,017.09 94,017.09 94,017.09
plant
low voltage switch
59,829.06 59,829.06 59,829.06 59,829.06
box
Information
transformation of
129,829.06 129,829.06 140,000.00 140,000.00
heat treatment
production line
Ipsen multipurpose
furnace overhaul 0.00 832,500.00 832,500.00
renovation
G17-15-07 Ball
bearing vibration 31,384.62 31,384.62 31,384.62 31,384.62
detector
G17-16-03 New
workshop
130,630.63 130,630.63 130,630.63 130,630.63
warehouse and
concrete road
G17-16-01
Environmental 153,153.15 153,153.15 153,153.15 153,153.15
improvement works
other 13,371,970.46 13,371,970.46 8,420,208.60 8,420,208.60
Total 84,338,838.27 84,338,838.27 82,689,318.94 82,689,318.94
13 Intangible assets
Item Land use right software Total
1.Initial cost
1). Opening balance 124,220,541.52 6,272,685.89 130,493,227.41
2).Increase 97,087.38 97,087.38
(1) Purchase 97,087.38 97,087.38
(2)Internaldevelopment
(3) Acquired by company
combination
3). Decrease
4). Closing balance 124,220,541.52 6,369,773.27 130,590,314.79
2. Amortization
1). Opening balance 36,823,081.84 6,140,023.31 42,963,105.15
2).Increase 1,545,146.91 71,983.31 1,617,130.22
(1)Accrual 1,545,146.91 71,983.31 1,617,130.22
(2)Transfer into
3). Decrease 1,299,213.84 1,299,213.84
55
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
4). Closing balance 37,069,014.90 6,212,006.62 43,281,021.53
3. Provision
for impairment
1). Opening balance
2).Increase
3). Decrease
4). Closing balance
4. Book value
1.Closing Book value 87,151,526.61 157,766.65 87,309,293.26
2.Opening Book value 87,397,459.68 132,662.58 87,530,122.26
14 Long-term deferred and prepaid expenses
Other
Item 2017.12.31 Increase Amortization 2018.06.30
decrease
Office house decoration 700,228.04 61,843.08 638,384.96
Total 700,228.04 61,843.08 638,384.96
15 Deferred tax assets and deferred tax liabilities
(1) Deferred tax assets without deduction
Item Closing Balance Opening Balance
Deductible temporary Deferred tax Deductible temporary Deferred tax
difference assets difference assets
Provision for impairment of assets 74,103,756.75 11,625,939.19 74,103,756.75 11,625,939.19
Total 74,103,756.75 11,625,939.19 74,103,756.75 11,625,939.19
(2) Deferred tax liabilities without deduction
Item Closing Balance Opening Balance
Taxable temporary Deferred tax Taxable Deferred tax
difference liabilities temporary liabilities
difference
Asset evaluation increment in
business combination without 5,920,560.37 888,084.06 5,920,560.37 888,084.06
the same control
Total 5,920,560.37 888,084.06 5,920,560.37 888,084.06
(3) The net value of deferred tax assets and deferred tax liabilities with deduction
Closing Balance Closing Balance Opening Balance of Opening Balance of
of deferred tax of deferred tax deferred tax assets deferred tax
Item assets and assets/deferred and liabilities with assets/deferred tax
liabilities with tax liabilities deduction liabilities
deduction
Deferred tax
11,625,939.19 11,625,939.19
assets
Deferred tax
888,084.06 888,084.06
liabilities
56
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
16 Short-term loan
(1) Category of short-term loan
Loan category 2018.06.30 2017.12.31
Credit loan 615,000,000.00 648,000,000.00
Total 615,000,000.00 648,000,000.00
17 Notes payable
Items 2018.06.30 2017.12.31
Commercial acceptance notes 362,918,752.32 295,396,000.00
Bank acceptance notes 2,055,536.74 4,087,279.00
Total 364,974,289.06 299,483,279.00
18 Accounts payable
(1) Accounts payable
Item Closing Balance Opening Balance
Loan 618,238,277.92 559,579,919.87
Project payments 44,673,609.65 50,109,631.21
Other 16,487,505.75 21,142,736.37
Total 679,399,393.32 630,832,287.45
19 Advances from customers
(1) Received in advance
Item Closing Balance Opening Balance
Loan 22,508,002.18 31,634,532.72
Total 22,508,002.18 31,634,532.72
20 Employee benefits payable
(1) Category of employee‘s payables
Item Opening Increase Decrease Closing Balance
Balance
Short-term
7,313,818.35 102,608,361.74 103,289,812.34 6,632,367.75
employee‘s payable
Welfare with deposit
9,346,330.29 14,423,053.67 14,515,683.14 9,253,700.82
and withdrawal plan
Total 16,660,148.64 117,031,415.41 117,805,495.48 15,886,068.57
(2) Short-term employee‘s payables
57
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
Item Opening Increase Decrease Closing
Balance Balance
Salaries, bonus,
allowance, and 204,820.34 75,980,585.34 76,028,894.31 156,511.37
subsidy
Welfare 3,200.00 7,824,726.68 7,824,726.68 3,200.00
Social insurance 595,786.05 8,786,783.06 8,785,404.46 597,164.65
Include: Medical
306,854.19 6,670,717.80 6,670,717.80 306,854.19
insurance
Industrial injury
218,079.54 1,232,985.63 1,231,607.03 219,458.14
insurance
Maternity
70,852.32 883,079.63 883,079.63 70,852.32
insurance
Housingfunds 2,267,654.57 9,947,105.26 10,431,740.64 1,783,019.19
Labour union and
4,242,357.39 69,161.40 219,046.25 4,092,472.54
training expense
Total 7,313,818.35 102,608,361.74 103,289,812.34 6,632,367.75
(3) Welfare with deposit and withdrawal plan
Item Opening Increase Decrease Closing Balance
Balance
Pension 9,010,407.61 14,036,744.84 14,129,374.31 8,917,778.14
Unemployment insurance 335,922.68 386,308.83 386,308.83 335,922.68
Total 9,346,330.29 14,423,053.67 14,515,683.14 9,253,700.82
21 Taxes payable
Item Closing Balance Opening Balance
Value-added tax 3,538,584.05 11,018,297.67
Individual income tax 222,312.20 140,904.05
Enterprise income tax
City maintenance and construction tax 323,209.56 982,277.76
Real estate tax 301,009.32 294,515.16
Land use tax 206,982.61 204,027.14
Stamp tax 81,712.41 109,592.56
Education surcharge 248,191.90 728,270.43
River toll fee 217.02 1,486.14
Others 370,078.06 370,601.41
Total
22 Interest payable
58
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
Item Closing Balance Opening Balance
Interest for long-term loan with instalments 65,300.00
Interest for short-term loan 157,000.00 1,124,800.00
Total 157,000.00 1,190,100.00
23 Other payables
Other payablescategorized by payments nature
Payments nature Closing Balance Opening Balance
Bid security deposits 1,321,570.00 1,118,409.62
Risk deposits from branch manager 259,777.75 259,777.75
Trademark fees 9,916,000.00 10,777,573.08
Others 67,493,863.19 79,967,333.47
Total 78,991,210.94 92,123,093.92
24 Non-current liabilities due within one year
(1)Non-current liabilities due within one year
Item Closing Balance Opening Balance
Long-term loan due within one year 90,000,000.00
Total 90,000,000.00
25 Other current liabilities
Item Closing Balance Opening Balance
Government subsidy within 1 year 3,967,022.53 3,967,022.53
Total 3,967,022.53 3,967,022.53
26 Long-term payables
(1) Long-term payablescategorized by payments nature
Payments nature Closing Balance Opening Balance
Equipment payments 100,000.00 100,000.00
Housing subsidy 1,497,305.72 1,497,305.72
27 Special payables
Items Opening Increase Decre Closing Formation Basis
Balance ase Balance
Granted by Wafangdian Bureau of
Special pollution Finance and Wafangdian Bureau of
221,698.98 221,698.98
treatment Environment Protection with approval
with ―WaCaiZhi Qi No.[2004]217‖
Dalian Financial Bureau and Municipal
Informatization
75,000.00 75,000.00 Office of Economic and Information
Construction
Technology Committee with approval
59
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
with ―Da CaiZhi Qi No. [2012]917‖ and
―Da Jing Xin Fa No. [2012]199‖
Total 296,698.98 296,698.98
28 Other non-current liabilities
(1) Category of deferred income
Item Opening Increase Decrease Closing
Formation Basis
Balance Balance
Government
37,754,771.56 1,908,277.94 35,846,493.62
subsidy
Total 37,754,771.56 1,908,277.94 35,846,493.62
(2) Government subsidy
Recorded Relate
Government Opening into non Other Closing d with
Increase
subsidy item Balance -operatio Change Balance asset/e
n income quity
Liaozhou Industry
development 4,194,564.00 4,194,564.00 asset
subsidies
Compensation for
Da Lian plants 27,042,358.18 1,352,117.94 25,690,240.24 asset
moving
Development of
intelligent
manufacturing 2,400,000.00 200,000.00 2,200,000.00 asset
equipment
subsidies
Improvement of
high-end bearing
1,889,280.00 236,160.00 1,653,120.00 asset
production
subsidies
Interest subsidy of
1,660,000.00 120,000.00 1,540,000.00 asset
grand axle load
Construction of
workshop for
568,569.38 568,569.38 asset
technology masters
subsidy
Total 37,754,771.56 1,908,277.94 35,846,493.62
29 Share capital
2017.12.31 Change for current period 2018.06.30
Issui Transferrin
Shareholders ng Distributi g capital
name/category Amounts % new ng reserves Others Subtotal Amounts %
share shares to share
s capital
402,600,00 100.0
Total shares — — — — — 402,600,000.00 100.00
0.00 0
60
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
30 Capital reserves
Items 2017.12.31 Increase Decrease 2018.06.30
Share premium 201,956,446.52 201,956,446.52
Other capital reserves 283,734,603.95 283,734,603.95
Total 485,691,050.47 485,691,050.47
31 Surplus reserves
Items 2017.12.31 Increase Decrease 2018.06.30
Statutory surplus reserve 113,687,908.35 113,687,908.35
Discretionary surplus reserve 20,590,618.91 20,590,618.91
Total 134,278,527.26 134,278,527.26
32 Undistributed profit
Item This period Last period
Closing balance before adjustment 362,925,296.98 359,603,965.97
Opening balance after adjustment 362,925,296.98 359,603,965.97
Add: Current net profit attributable to shareholders of
3,313,980.12 10,182,949.16
parent company
Less: Provision for statutory surplus reserves 2,835,618.15
Dividends payable for common shares 4,026,000.00
Closing balance of 366,239,277.10 362,925,296.98
33 Operating revenue & cost
Items This period Last period
Sales revenue Cost of sales Sales revenue Cost of sales
Revenue from
967,045,981.57 840,649,172.13 986,168,093.43 862,562,230.54
main operation
Revenue from
107,822,000.11 99,097,399.00 149,332,481.90 141,633,411.45
other operation
Total 1,074,867,981.68 939,746,571.13 1,135,500,575.33 1,004,195,641.99
34 Operating taxes and surcharges
Items This period Last period
Business tax
City construction tax 2,837,747.43 3,428,881.69
Education surcharge 1,871,171.22 2,425,208.91
Other 3,883,184.27 3,978,357.55
Total 8,592,102.92 9,832,448.15
61
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
35 Selling expenses
Items This period Last period
Transportation expense 15,584,316.08 20,935,762.98
Employee benefit 17,781,672.15 13,476,776.84
Travel expense 9,078,815.87 9,656,691.45
Conference expense 2,329,999.72 2,465,600.45
Trademark use fee 2,101,642.83 927,157.82
International Transportation expense 5,179,043.74 10,610,815.19
Other expense 18,684,081.24 17,947,375.19
Total 70,739,571.63 76,020,179.92
36 Administrative expenses
Items This period Last period
Employee benefit 18,773,771.75 17,708,196.38
Tax expense 17,251.55 511,493.60
Technology development expense 3,505,391.30 1,318,389.62
Intangible assets amortization 2,266,737.13 2,266,864.90
Depreciation expense 811,587.96 998,045.03
Business entertaining expense 338,336.74 403,673.93
Travel expense 533,425.68 397,589.98
Other expense 7,829,201.38 7,641,468.38
Total 34,075,703.49 31,245,721.82
37 Financial expenses
Items This period Last period
Interest expenses 22,726,199.79 16,282,310.02
Less: interest income 345,878.37 384,832.07
Add: Exchange losses 950,510.58 -1,336,112.98
Add: Others expenditure 721,591.13 1,454,903.78
Total 24,052,423.13 16,016,268.75
38 Assets impairment losses
Items This period Last period
Loss of bad debts -12,786.85 99,810.61
Total -12,786.85 99,810.61
39 Gain on assets disposal
Item current year prior year
62
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
Gain on disposal group classified as
243,495.82 7,398.46
held for sale
Gain on non-current assets disposal 243,495.82 7,398.46
Gain on fixed assets disposal 243,495.82 7,398.46
Total
40. Other income
Items current year prior year
Job stabilization subsidy 228,550.21
Labour union subsidy 15,000.00
International market development subsidy from Foreign Trade
147,000.00
bureau
Technology innovation subsidy in Liaoniing 368,500.00
Dalian sub-factory relocation subsidy 1,352,117.94 1,352,117.94
Improvement of high-end bearing production subsidies 236,160.00 236,160.00
Development of intelligent manufacturing equipment subsidies 200,000.00 200,000.00
Technical master studio development subsidy
Overhaul bearing project discounting interest subsidy 120,000.00 120,000.00
Insurance premium subsidy 18,600.00
Total 2,155,428.15 2,438,777.94
41 Non-operating income
(1) Non-operating income list
This period Last period Amounts recognized into
Item current non-recurring profit
or loss
Income from debt restructuring 1,456,952.01 1,356,259.02 1,456,952.01
Penalty income 1,570,251.86 832,777.00 1,570,251.86
Others 120,000.41 80,229.95 120,000.41
Total 3,147,204.28 2,269,265.97 3,147,204.28
42 Non-operating expenses
Item This period Last period
Loss from debt restructuring 85,383.59
Loss on disposal of non-current assets 75,526.04 5,970.42
Penalty loss 11,410.47 15,648.86
Others 13,651.07 150,691.63
Total 185,971.17 172,310.91
43 Income tax expenses
63
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
(1) Income tax expenses
Items current year prior year
Current income tax expenses -279,426.81
Total -279,426.81
(2) Accounting profit to income tax expense adjustment
Items Current year
Consolidated total profit this year 3,034,553.31
Income tax expenses at applicable tax rate -279,426.81
Income tax expense -279,426.81
44 Notes to cash flow statement
(1) Cash receipt/payment of other operating/investing/financing activities
1) Other cash received relating to operating activities
Items This period Last period
Other cash received relating to operating activities 914,421.41 1,373,744.39
Total 914,421.41 1,373,744.39
2) Other cash paid relating to operating activities
Items This period Last period
Other cash paid relating to operating
55,833,437.00 52,708,495.81
activities
Total 55,833,437.00 52,708,495.81
3) Other cash received relating to financial activities
Items This period Last period
Other cash paid relating to financial
328,905,975.40 321,721,729.99
activities
Total 328,905,975.40 321,721,729.99
4) Other cash paid relating to financial activities
Items This period Last period
Other cash paid relating to financial
248,898,190.83 286,551,613.33
activities
Total 248,898,190.83 286,551,613.33
45 Supplementary information of consolidated cash flow statement
Items This period Last period
1. Adjusting net profit into cash flows of operating activities:
Net profit 3,313,980.12 2,633,635.55
64
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
Add: Provision for impairment of assets -12,786.85 99,810.61
Depreciation of fixed assets 50,705,693.88 48,297,397.65
Amortization of intangible assets 2,266,737.13 2,266,864.90
Amortization of long-term deferred expenses 33,915.18 33,915.18
Losses on disposal of fixed assets, intangible assets, and
-243,495.82 -10,771.00
long-term assets (income listed with‖-‖)
Losses on write-off of fixed assets (income listed with‖-‖) 75,526.04
Financial expense (income listed with‖-‖) 24,052,423.13 16,016,268.75
Decrease of inventory (increase listed with‖-‖) -18,635,014.88 74,534,439.97
Decrease of operating receivables (increase listed with‖-‖) -156,396,318.53 -138,273,848.15
Increase of operating payables (decrease listed with‖-‖) 139,045,935.83 -82,203,972.02
Net cash flows arising from operating activities 44,206,595.23 -76,606,258.56
Cash and cash equivalents
Items This period Last period
Cash 74,828,879.85 58,043,497.54
Closing balance of cash and cash equivalents 74,828,879.85 58,043,497.54
VIII. Equity of Other Entities
1. Equity of subsidiaries
(1) Organization structure of group company
Share（%）
Name of subsidiary Location Registered Location Nature of operation Method
Direct Indirect
Wazhou Liaoyang Manufacturing and
Liaoyang Baita District acquisitio
Bearing construction Wafangdian selling bearing and 100
Weiguo Rd No.61 n
Co.,Ltd machines
Dalian Wazhou Precision Dalian Free Trade Zone Manufacturing and
investmen
Motor Car Bearing Wafangdian SanshiliYongsheng Rd selling bearing and 100
t
Company Limited No.12 machines
Wazhou Precision of
Manufacturing and
Spherical Roller WafangdianBeigongji St acquisitio
Wafangdian selling bearing and 100
Bearings(Wafangdian)Co. No.1 n
machines
, Ltd
IX Risk Related to Financial Instrument
The main financial instruments held by the group company are including investment in share equity, borrowing,
accounts receivable, and accounts payable. The details introduction about each financial instrument is referred to this
notes No.VI above. The related risks of these financial instruments and the risk management policy conducted to
reduce these risks by the group company are introduced as below. The Group management conducts to manage and
monitor these risks exposure and control these risks under certain risk level.
1. Objectives and policies of each risk management
The objectives of risk management conducted by the group company are to reach the balance between risk and
profit return by reducing the negative influence to operating performance to the minimum level as well as
65
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
maximising the shareholders‘ and other investors‘ profits. Based on these objectives, the basic risk management
policy is to recognize and analyse all sorts of risk that the group company faced with, to set up the proper risk
tolerance bottom line conducting risk management, as well as to monitor these risks in a timely and effective manner,
and to ensure these risks under the limit level.
(1) Market risk
1) Currency risk
The currency risk is referred as the risk caused by the fluctuation of exchange rate. The main currency risk that the
company faced with is related to the USD since the main export business is settled by USD. Other than the balance
of foreign currency presented in Note VI. 44, all assets and liabilities of company are presented in RMB On
December 31, 2015.The balance in foreign currency of assets and liabilities may cause currency risk with influence
to operating performance.
2) Interest risk
The main potential interest risk which is caused by the fluctuation of the cash flow of financial instruments is related
to the floating rate of bank loan (Note VI. 15). The policy that adopted by the Group is to maintain the floating rate of
loan.
(2) Credit risk
On 31 December, 2015, the Group‘s most probable credit risk exposure is from the financial loss primarily due to the
failure of fulfilling the obligation by one party of the contract. The impairment losses of company‘s financial assets
are including:
Among the book value of recognized financial assets in the consolidated statement of financial position, for the
financial instruments measured at fair value, their book values reflect the risk exposure, however, not maximum risk
level; the level is changing along with the fair value.
As the aim to reduce the credit risk, the Group sets up the credit department to ensure the credit limit, to examine
and approve the credit application, and to carry out monitor procedures to claim expired creditor‘s right. In addition,
at each of balance sheet date, the Group checks with every single process of receipt of receivable to ensure the
sufficiency of provision of bad debt. Therefore, the management of the Group believed the credit risk had been
minimized significantly.
The working capital has low level of credit risk since the cash is deposited in the banks with high credit reputation.
(3) Liquidity risk
As the management of liquidity risk, the Group‘s policy is to regularly monitor the sufficiency of cash and cash
equivalent, the liquidity requirements to ensure the normal operations, and the fluctuation of cash flow. The bank
loan activities are under monitoring by management to make sure to comply with the loan agreement.
The liquidity risk is referred as the Group failed to fulfil its financial obligations by the due date. The Group manages
the liquidity risk by the maintain sufficiency of working capital to cover the expired debt to avoid the unacceptable
losses or the damage of Group‘s reputation. The Group analyses the debt structure and due time periodically to
ensure the sufficiency of available cash flow. The bank loan activities are under monitoring by management to make
sure to comply with the loan agreement. At the same, the Group has consultation with financial organizations about
the financing activities to maintain the credit level and to reduce the credit risk.
X. Disclosure of Fair Value
XI Related Parties Relationship and Transactions
1 Parent company and ultimate controller
Parent Registered Business nature Registere Shareholding Voting power
company address d capital percentage percentage (%)
(%)
66
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
No. 1 North Gongji Manufacture and
Wazhou 413,793,1
Street, Wafangdian sales of bearing and 60.61 60.61
Group 00.00
City, Dalian other equipments
(2). Subsidiaries
Referring to the content in Note IX. 1. (1) Organization structure of group company
2 Other related parties
Name of related party Related party relationship
Dalian Wazhou Bearing Manufacturing Equipment Co., Other entity controlled by the same parent company and
Ltd ultimate controlling party
Other entity controlled by the same parent company and
Wazhou Precision Steel Ball Company
ultimate controlling party
Other entity controlled by the same parent company and
Wazhou Exact Forge Ltd.,
ultimate controlling party
Other entity controlled by the same parent company and
Wazhou Group Wind power Bearing Ltd
ultimate controlling party
Other entity controlled by the same parent company and
Wazhou Group Exact Transmission Bearing Co., Ltd
ultimate controlling party
Other entity controlled by the same parent company and
Wazhou Group Equipment Technology Project Co., Ltd.
ultimate controlling party
Other entity controlled by the same parent company and
Wazhou Group Special Precision Bearing Co., Ltd.
ultimate controlling party
Other entity controlled by the same parent company and
Liao Ning North Metal Materials supply Co., Ltd
ultimate controlling party
Other entity controlled by the same parent company and
Wazhou Group (USA) Bearing CO., Ltd.
ultimate controlling party
Other entity controlled by the same parent company and
Wazhou Group high-end auto bearing limited company
ultimate controlling party
Other entity controlled by the same parent company and
Wazhou Group Precision Roller limited companu
ultimate controlling party
Other entity controlled by the same parent company and
Wazhou Group Precision Retainer Limited Company
ultimate controlling party
Other entity controlled by the same parent company and
Kugel- und Rollenlagerwerk Leipzig GmbH
ultimate controlling party
Other entity controlled by the same parent company and
Wafangdian bearing Power Limited Company
ultimate controlling party
Wazhou Group Bearing Engineering technology Other entity controlled by the same parent company and
research center ultimate controlling party
Other entity controlled by the same parent company and
Wazhou Group Special Steel limited Company
ultimate controlling party
Dalian GONA Wazhou Auto Bearings Co., Ltd Other related party
Dalian Wazhou Jinzhou Machinery Co., Ltd Other related party
Wafangdian Tongda Bearing Manufacturing Co., Ltd Other related party
Dalian WazhouFengyuan Machinery Co., Ltd Other related party
3 Related party transactions
(1) Purchase of goods
67
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
Content current year Authorized Over or not prior year
Related party
amount
Wazhou Group Purchase of goods 30,619,927.27 150,000,000.00 No
Wazhou Exact Forge Ltd. Purchase of goods 111,393,715.62 230,000,000.00 No 77,936,367.41
Dalian Wazhou Jinzhou Machinery Purchase of goods
7,864,718.39 8,000,000.00 No 32,874,239.72
Co., Ltd
Dalian Wazhou Fengyuan Purchase of goods
46,955,706.73 100,000,000.00 No 40,745,644.79
Machinery Co., Ltd
Wazhou Group Exact Purchase of goods
47,958,716.67 140,000,000.00 No 35,651,638.02
Transmission Bearing Co., Ltd
Wazhou Group Equipment Purchase of goods
489,477.68 10,000,000.00 No 6,546,307.65
Technology Project Co., Ltd.
Dalian Wazhou Bearing Purchase of goods/
6,734,683.20 36,000,000.00 No 10,239,204.30
Manufacturing Equipment Co., Ltd equipments
Wafangdian Tongda Bearing Purchase of goods
42,508,436.34 90,000,000.00 No 35,967,883.00
Manufacturing Co., Ltd.
Wazhou Group Wind power Purchase of goods
9,484,876.58 22,000,000.00 No 67,903,907.05
Bearing Ltd
Wazhou Precision Steel Ball Purchase of goods
1,503,484.72 5,000,000.00 No 2,249,100.62
Company
Wafangdian bearing Power Purchase of goods
10,653,628.93 22,200,000.00 No 10,391,594.66
Limited Company
Wazhou Group Precision Roller Purchase of goods
69,149,890.34 100,000,000.00 No 47,821,095.07
limited company
Wazhou Group Precision Retainer Purchase of goods
28,884,389.11 60,000,000.00 No 27,936,491.52
Limited Company
Wazhou Group high-end auto Purchase of goods
35,549,549.22 200,000,000.00 No 64,029,180.29
bearing limited company
Wazhou Group Special Precision Purchase of goods
50,288.10 0.00 Yes
Bearing Co., Ltd.
Wazhou Group Bearing Purchase of reserve
Engineering technology research 1,531,492.08 8,000,000.00 No 1,518,389.62
cener
Wazhou Group Purchase of reserve 38 250 No 107
Wazhou Group Purchase of reserve 130 900 No 93
Total 453,012,980.98 1,215,700,000.00 No 462,911,043.72
(2) Sales of goods
Related party Content current year prior year
Wazhou Exact Forge Ltd., Sales of goods 46,150,623.18 88,377,746.34
Wazhou Group Sales of goods 15,499.77 111,453.04
Wazhou Group (USA) Bearing CO., Ltd. Sales of goods 25,230,262.57 33,462,342.95
Wazhou Group Exact Transmission Bearing Sales of goods
20,892,673.15 17,128,024.78
Co., Ltd
Dalian Wazhou Manufacturing Equipment Co., Sales of goods
74,038.35 137,745.81
Ltd
Wazhou Group Precision Wind power Bearing Sales of goods
6,887,104.50 15,125,611.60
Ltd
Wazhou Group Special Precision Bearing Co., Sales of goods
271,679.73 255,794.10
Ltd.
68
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
Sales of goods
Wazhou Precision Steel Ball Company 31,876.56 999,505.14
Dalian Wazhou Jinzhou Machinery Co., Ltd Sales of goods 3,661.80 29,615.00
Wafangdian Tongda Bearing Manufacturing Sales of goods
686,608.84 213,232.25
Co., Ltd.
Wazhou Group Precision Roller limited Sales of goods
24,423,093.18 24,734,923.69
company
Wazhou Group Precision Retainer Limited Sales of goods
51,663.87 1,810,068.24
Company
Wazhou Group high-end auto bearing limited Sales of goods
43,998,131.35 129,506,733.45
company
Kugel- und Rollenlagerwerk Leipzig GmbH Sales of goods 3,351,510.13 1,549,815.31
Wazhou Group high-end auto bearing limited provide labour
services 195,477.99 162,116.67
company
Wazhou Group Precision Roller limited provide labour
services 6,293,599.71 8,585,573.54
company
Wazhou Group Special Precision Bearing Co., provide labour
services 342,841.37 295,246.43
Ltd.
provide labour
Dalian Wazhou Jinzhou Machinery Co., Ltd 68,824.03 57,455.85
services
provide labour
Wazhou Precision Steel Ball Company 466,981.76 762,464.12
services
Wazhou Group Exact Transmission Bearing provide labour
services 25,261.57 29,875.05
Co., Ltd
Dalian Wazhou Manufacturing Equipment Co., provide labour
services 164,181.78 281,992.44
Ltd
Wafangdian Tongda Bearing Manufacturing provide labour
services 16,456.70
Co., Ltd.
Total 179,625,595.19 323,633,792.50
4 Assets rent out
Detials can be found in the part VII ―the important rlated party transactions‖ 1 ―The relate transactions related to the
day-to-day operations.‖
5 Related party assets transfer and debt structure reconstruction
6. Balances with related parties
(1) Accounts receivable due from related parties
Closing Balance Opening Balance
Item Related party
Book Balance Provision Book Balance Provision
Accounts Wazhou Exact Forge
2,687,126.33 9,357,030.29
receivable Ltd.,
Accounts Wazhou Group Precision
62,494,203.33 68,353,382.34
receivable Roller Limited Company
69
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
Closing Balance Opening Balance
Item Related party
Book Balance Provision Book Balance Provision
Accounts Wazhou Group (USA)
15,659,092.29 13,686,294.41
receivable Bearing CO., Ltd.
Wazhou Group Precision
Accounts
Retainer Limited 18,823,964.21 24,191,042.68
receivable
Company
Wazhou Group Special
Accounts
Precision Bearing Co., 4,568,598.65 4,724,144.07
receivable
Ltd.
Accounts Wazhou Group Limited
2,255,928.31 2,255,928.31
receivable Company
Wazhou Group Exact
Accounts
Transmission Bearing 11,484,768.27 3,714,337.85
receivable
Co., Ltd
Wazhou Group high-end
Accounts
auto bearing limited 121,981,082.84 157,299,071.76
receivable
company
Accounts Wazhou Special Steel
1,265,539.80 1,127,180.69
receivable Ball Company
Kugel- und
Accounts
Rollenlagerwerk Leipzig 1,216,618.52 2,843,173.17
receivable
GmbH
Wafangdian Tongda
Accounts
Bearing Manufacturing 71,061.68 149,884.33
receivable
Co., Ltd.
Accounts Dalian Wazhou Jinzhou
619,374.11 484,891.17
receivable Machinery Co., Ltd
Kugel- und
Prepaid Rollenlagerwerk Leipzig 3,368,086.16
GmbH
Wazhou bearing Power
Prepaid 5,099,826.27 1,340,370.00
limited Company
(2) Accounts payable due from related parties
Item Related party Closing Balance Opening Balance
Accounts payable Wazhou Group Wind Power Bearing Ltd 22,657,706.00 56,086,707.09
Accounts payable Wazhou Group Limited Company 24,265,359.57 3,552,228.26
Wazhou Group Equipment Technology
Accounts payable 13,882,010.02 17,010,528.77
Project Co., Ltd.
Wafangdian Tongda Bearing
Accounts payable 34,216,624.03 20,874,853.98
Manufacturing Co., Ltd.
Accounts payable Dalian Wazhou Jinzhou Machinery Co., Ltd 1,197,535.41 6,757,162.31
Dalian Wazhou Bearing Manufacturing
Accounts payable 4,060,208.41 8,447,383.10
Equipment Co., Ltd
Accounts payable Wazhou Exact Forge Ltd., 59,523,954.57 12,760,327.17
Dalian Wazhou Fengyuan Machinery Co.,
Accounts payable 22,457,937.48 25,856,222.75
Ltd
70
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
Item Related party Closing Balance Opening Balance
Wazhou Group Precision Retainer Limited
Accounts payable 1,632,766.91 6,692,821.86
Company
Accounts payable Wazhou Precision Steel Ball Company 3,546,738.23 3,486,892.33
Wazhou Group Precision Roller Limited
Accounts payable 4,884,537.36 3,403,327.15
Company
Accounts payable Wazhou Group (USA) Bearing CO., Ltd. 147,968.25
Wazhou Group Exact Transmission
Accounts payable 18,741,436.53 21,020,328.46
Bearing Co., Ltd
Accounts payable Wazhou bearing power limited company 544,121.00 311,333.62
Wazhou Group Bearing Engineering
Accounts payable 2,323,382.46 2,833,243.49
technology research center
Other payables Wazhou Group limited company 1,738,516.32 12,295,652.49
Dalian Wazhou Bearing Manufacturing
Other payables 431,088.45 431,088.45
Equipment Co., Ltd
Wazhou Group Equipment Technology
Other payables 953,000.00 953,000.00
Project Co., Ltd.
7. Contingency
As at June 30,2018, the Group does not have any other contingencies.
XIII. Share-Based Payment
XIV. Commitment and Contingency
As at June 30,2017, the Group does not have any other significant commitments.
XV. Events after the Balance Sheet Date
The Group does not have any other significant events after the Balance Sheet Date.
XVI. Other Significant Events
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Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
XVII. Notes to the Main Items of the Financial Statements of Parent Company
1 Accounts receivable
(1) Accounts receivable category
Closing Balance
Item Booking balance Provision
Booking balance
Amount % Amount %
Accounts receivable with bad debt
provision based on the characters of 1,196,362,584.79 98.43% 41,184,310.64 4.29% 1,155,178,274.15
credit risk portfolio
Accounts receivable with insignificant
100.00
individual amount and separate bad 19,049,504.15 1.57% 19,049,504.15
%
debt provision
100.00
Total 1,215,412,088.94 60,233,814.79 1,155,178,274.15
%
(Continued)
Opening Balance
Item Booking balance Provision
Booking balance
Amount % Amount %
Accounts receivable with bad debt
provision based on the characters 1,155,247,805.56 98.38% 42,129,550.06 4.80% 1,113,118,255.50
of credit risk portfolio
Accounts receivable with
insignificant individual amount and 19,049,504.15 1.62% 19,049,504.15 100.00%
separate bad debt provision
Total 1,174,297,309.71 100.00% 61,179,054.21 1,113,118,255.50
2) Accounts receivable accrued the bad debt provisions in the portfolio as accounting aging analysis method
Closing Balance
Aging Provision for bad Proportion
Accounts receivable
debts (%)
Within 1 year 736,656,401.91 7,366,564.02 1.00%
1-2 years 148,280,910.59 7,414,045.53 5.00%
2-3 years 37,842,019.47 7,568,403.89 20.00%
3-4 years 37,670,594.39 18,835,297.20 50.00%
Total 960,449,926.36 41,184,310.64
(2) Bad debt provision accrued and write-off (withdraw)
(3) Accounts receivable written off in current period
2 Other receivables
2. Other receivables
(1) The category of other receivables
Closing Balance
Items
Booking balance Provision Booking
72
Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
Amount % Amount % balance
Other receivables with bad debt provision based
25,464,888.40 83.46% 1,000,107.00 6.94% 24,464,781.40
on the characters of credit risk portfolio
Other receivables with insignificant individual
5,048,580.92 16.55% 5,048,580.92 100.00%
amount and separate bad debt provision
Total 100.00
30,513,469.32 6,048,687.92 24,464,781.40
%
(Continued)
Opening Balance
Items Booking balance Provision Booking balance
Amount % Amount %
Other receivables with bad debt provision based 1,000,107
21,605,385.47 81.06% 7.65% 20,605,278.47
on the characters of credit risk portfolio .00
Other receivables with insignificant individual 5,048,580
5,048,580.92 18.94% 100.00%
amount and separate bad debt provision .92
Total 100.00 6,048,687
26,653,966.39 20,605,278.47
% .92
1) Other receivables accrued the bad debt provisions in the portfolio as accounting aging analysis method
Closing Balance
Aging Provision for bad Proportion
Other receivables
debts (%)
Within 1 year 10,676,890.69 106,768.91 1.00%
1-2 years 1,938,203.70 96,910.19 5.00%
2-3 years 328,580.19 65,716.04 20.00%
3-4 years 1,461,423.72 730,711.86 50.00%
Total 14,405,098.30 1,000,107.00
(2) Other receivables categorized by nature
Nature Closing Balance Opening Balance
Other receivables 30,513,469.32 26,653,966.39
Total 30,513,469.32 26,653,966.39
3 Long-term equity investments
(1) Category of long-term equity investments
Item Closing Balance Opening Balance
Opening
Closing Balance Provision Book Value Provision Book Value
Balance
Investment into
211,583,897.67 211,583,897.67 211,583,897.67 211,583,897.67
subsidiaries
Total 211,583,897.67 211,583,897.67 211,583,897.67 211,583,897.67
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Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
(2) Investments into subsidiaries
Provision
Closing
Opening Closing carried
Subsidiaries names Increase Decrease Balance of
Balance Balance current
provision
period
Wazhou Liaoyang Bearing
17,337,259.95 17,337,259.95
construction Co.,Ltd
Dalian Wazhou Precision Motor Car
45,478,956.37 45,478,956.37
Bearing Company Limited
Wazhou Precision of Spherical
Roller Bearings(Wafangdian)Co., 148,767,681.35 148,767,681.35
Ltd
Total 211,583,897.67 211,583,897.67
4 Operating revenue and cost
Item This period Last period
Revenue Cost Revenue Cost
Revenue from main operation 952,060,623.14 832,879,338.83 972,513,250.78 857,675,134.61
Revenue from other operation 103,899,325.53 96,290,684.90 149,234,390.96 142,142,020.55
Total 1,055,959,948.67 929,170,023.73 1,121,747,641.74 999,817,155.16
XVII Supplementary Information to the Financial Statements
1. Non-operating profit or loss
Items Amount Notes
Gain or loss from disposal of non-current assets 167,969.78
Government grants recorded into profit or loss during current period 2,155,428.15
Profit or loss from debts restructuring 1,371,568.42
Others non-operating revenue and expense besides the above items 1,665,190.73
Effect from income tax 501,892.88
Total 4,858,264.20
2. Return on equity and earnings per share
Weighted average Earnings per share (EPS)
Profit of report period return on net assets Basic Diluted EPS
(%) EPS
Net profit attributable to shareholders of parent company 0.24% 0.008 0.008
Net profit after deducting non-recurring gains and losses
-0.11% -0.004 -0.004
attributable to shareholders of parent company
3. Differences in accounting information under IAS and domestic accounting standard
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Wafangdian Bearing Co., Ltd（Wazhou B） 2018 Mid-year Report
Chapter X. List of reference documents
1. The 2018 mid-yare Accounting statements 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.
75
