Lu Thai Textile Co., Ltd. Third Quarter Report 2017
LU THAI TEXTILE CO., LTD.
THIRD QUARTER REPORT 2017
October 2017
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
Part I Important Statements
The board of directors (the “Board”), the supervisory board (the “Supervisory Board”) as
well as the directors, supervisors and senior management of Lu Thai Textile Co., Ltd. (the
“Company”) hereby guarantee the factuality, accuracy and completeness of the contents of
this Report, and shall be jointly and severally liable for any false representation, misleading
statements or material omissions in this Report.
All the directors of the Company attended the board meeting for the review of this Report.
Liu Zibin, head of the Company, Zhang Hongmei, accounting head for this Report, and
Zhang Keming, head of the accounting department (head of accounting) of the Company,
hereby guarantee that the financial statements carried in this Report are factual, accurate and
complete.
This Report has been prepared in both Chinese and English. Should there be any
discrepancies or misunderstandings between the two versions, the Chinese version shall
prevail.
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
Part II Company Fundamentals
I Key Consolidated Operating Results
Indicate by tick mark whether the Company needs to retrospectively restate any of its accounting data.
□ Yes √ No
September 30, 2017 December 31, 2016 Change
Total assets (RMB) 9,519,311,781.79 9,407,103,263.34 1.19%
Equity attributable to owners of the parent (RMB) 7,039,665,999.44 6,937,985,729.19 1.47%
July-September January-September
YoY change YoY change
2017 2017
Net sales (RMB) 1,631,824,401.03 13.80% 4,622,284,097.46 8.37%
Net margin attributable to owners of the parent
197,038,648.01 -16.69% 590,108,629.56 1.54%
(RMB)
Net margin attributable to owners of the parent before
179,229,437.40 -19.60% 564,310,595.85 1.47%
exceptional gains and losses (RMB)
Net cash from operating activities (RMB) -- -- 834,029,908.57 -23.57%
Basic earnings per share (RMB/share) 0.21 -16.00% 0.64 3.23%
Diluted earnings per share (RMB/share) 0.21 -16.00% 0.64 3.23%
Weighted average return on equity (%) 2.83% -0.72% 8.41% -0.24%
Exceptional gains and losses:
√ Applicable □ Not applicable
Unit: RMB
Item January-September 2017 Note
Gains/Losses on disposal of non-current assets (inclusive of offset asset impairment
1,850,570.54
provisions)
Governmental subsidy recorded into current gains/losses (exclusive of
governmental subsidy closely relevant to business events, and quantified according 30,745,322.67
to national unified standards)
Gains/Losses on fair value changes of trading financial assets and liabilities &
investment income from disposal of trading financial assets and liabilities as well
3,567,478.35
as financial assets available for sale (exclusive of effective hedges related to normal
business operations of the Company)
Non-operating income and expense other than above 555,382.08
Less: Income tax effects 5,696,638.90
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
Minority interests effects (after tax) 5,224,081.03
Total 25,798,033.71 --
Explanation of why the Company classified an item as an exceptional gain/loss according to the definition in the Explanatory
Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Exceptional Gains and
Losses, or reclassified any exceptional gain/loss item given as an example in the said explanatory announcement as a recurrent
gain/loss:
□ Applicable √ Not applicable
No such cases in the Reporting Period.
II Total Number of Shareholders and Shareholdings of Top 10 Shareholders at Period-End
1. Numbers of Common Shareholders and Preference Shareholders with Resumed Voting Rights, and
Shareholdings of Top 10 Shareholders
Unit: share
Total number of common Total number of preference shareholders with
57,584 0
shareholders at period-end resumed voting rights at period-end (if any)
Top 10 shareholders
Restricted Pledged or frozen
Total shares
Nature of Shareholding shares held shares
Name of shareholder held at
shareholder percentage at
period-end Status Number
period-end
Domestic
Zibo Lucheng Textile Investment Co., Ltd. non-state-owned 15.21% 140,353,583
corporation
Foreign
Tailun (Thailand) Textile Co., Ltd. 12.82% 118,232,400 118,232,400
corporation
Foreign
Hong Kong Securities Clearing Co. Ltd 2.71% 25,000,508
corporation
State-owned
Central Huijin Assets Management Co., Ltd. 2.20% 20,315,300
corporation
Foreign
T.Rowe Price Intl Discovery Fund 2.16% 19,948,219
corporation
State-owned
China Securities Finance Corporation Limited 1.70% 15,679,091
corporation
Domestic
Hua’an New Silk Road Theme Equity
Non-stated-owned 1.11% 10,200,000
Securities Investment Fund
corporation
Hong Kong Monetary Authority －own Foreign
1.08% 9,978,984
funds corporation
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
Foreign
Lynas Asia Fund 0.90% 8,342,900
corporation
Foreign
BNP Paribas－own funds 0.80% 7,777,994
corporation
Top 10 non-restricted shareholders
Non-restricted shares held at Type of stock
Name of shareholder
period-end Type Number
RMB common
Zibo Lucheng Textile Investment Co., Ltd. 140,353,583 140,353,583
stock
RMB common
Hong Kong Securities Clearing Co. Ltd 25,000,508 25,000,508
stock
RMB common
Central Huijin Assets Management Co., Ltd. 20,315,300 20,315,300
stock
Domestically
T.Rowe Price Intl Discovery Fund 19,948,219 listed stock for 19,948,219
foreign investors
RMB common
China Securities Finance Corporation Limited 15,679,091 15,679,091
stock
Hua’an New Silk Road Theme Equity Securities Investment RMB common
10,200,000 10,200,000
Fund stock
Domestically
Hong Kong Monetary Authority －own funds 9,978,984 listed stock for 9,978,984
foreign investors
Domestically
Lynas Asia Fund 8,342,900 listed stock for 8,342,900
foreign investors
RMB common
BNP Paribas－own funds 7,777,994 7,777,994
stock
Domestically
RBC Emerging Markets Small Cap Equity Fund 6,785,384 listed stock for 6,785,384
foreign investors
Zibo Lucheng Textile Investment Co., Ltd. is the largest
shareholder of the Company and the actual controller. Tailun
(Thailand) Textile Co., Ltd. is the second largest shareholder as
well as sponsor of foreign capital of the Company. All of other
Related or acting-in-concert parties among shareholders above
shareholders are people holding circulating A share or circulating B
share and the Company is not able to confirm whether there is
associated relationship or concerted action among other
shareholders.
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
Top 10 common shareholders conducting securities margin
Naught
trading (if any)
Indicate by tick mark whether any of the top 10 common shareholders or the top 10 non-restricted common shareholders of the
Company conducted any promissory repo during the Reporting Period.
□ Yea √ No
No such cases in the Reporting Period.
2. Total Number of Preference Shareholders and Shareholdings of Top 10 of Them at Period-End
□ Applicable √ Not applicable
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
Part III Significant Events
I Changes in Key Consolidated Financial Statement Items and Reasons for Such Changes
√ Applicable □ Not applicable
(1) Construction in progress increased 91.17% from the December 31, 2016 amount to RMB295,683,932.33 on September 30, 2017,
due primarily to new construction projects of Xinsheng Thermal Power and Xinjiang Lu Thai Textile arising in the period January
through September 2017.
(2) Financial liabilities at fair value through gains/losses increased 100.00% from the December 31, 2016 amount to RMB796,400.00
on September 30, 2017, due primarily to increase in trading financial liabilities.
(3) Notes payable increased 100.00% from the December 31, 2016 amount to RMB5,850,646.86 on September 30, 2017, due
primarily to increase in trade acceptance bills payable.
(4) Taxes payable decreased 34.09% from the December 31, 2016 amount to RMB50,890,407.93 on September 30, 2017, due
primarily to decrease in income taxes and urban maintenance tax payable.
(5) Non-current liabilities due within one year increased 100.00% from the December 31, 2016 amount to RMB135,950,175.68 on
September 30, 2017, due primarily to the reclassification of long-term borrowings that became due within one year in the period
January through September 2017.
(6) Long-term borrowings decreased 100.00% from the December 31, 2016 amount to RMB0.00 on September 30, 2017, due
primarily to the reclassification of long-term borrowings that became due within one year as non-current liabilities due within one
year in the period January through September 2017.
(7) Other comprehensive income decreased 50.98% from the December 31, 2016 amount to RMB26,122,877.09 on September 30,
2017, due primarily to lower income from translation of foreign subsidiaries’ financial statements presented in foreign currencies.
(8) The year-over-year increase of 80.99% in taxes and surtaxes to RMB73,695,429.20 during the period January through September
2017 primarily resulted from the reclassification of the taxes sub-item under the administrative expense item as taxes and surtaxes as
per Financial Accounting Document [2016] No. 22—Value Added Tax Accounting Rules during the period January through
September 2017.
(9) The year-over-year increase of 69.11% in finance costs to RMB44,572,889.12 during the period January through September 2017
primarily resulted from greater foreign exchange losses.
(10) The year-over-year decrease of 30.54% in asset impairment losses to RMB3,350,210.60 during the period January through
September 2017 primarily resulted from a lower amount of inventory valuation allowances.
(11) The year-over-year decrease of 101.72% in gains on fair value changes to RMB-796,400.00 during the period January through
September 2017 primarily resulted from lower income from changes in the fair value of financial liabilities.
(12) The year-over-year increase of 111.18% in investment income to RMB4,803,678.35 during the period January through
September 2017 primarily resulted from greater gains on derivative financial instruments invested in.
(13) The year-over-year increase of 100.00% in other income to RMB30,565,322.67 during the period January through September
2017 primarily resulted from the reclassification of government subsidies arising from the Company’s ordinary course of business
(originally under non-operating income) as other income as per Accounting Standard No. 16 for Business Enterprises—Government
Subsidies.
(14) The year-over-year decrease of -70.64% in non-operating income to RMB9,846,350.62 during the period January through
September 2017 primarily resulted from the reclassification of government subsidies arising from the Company’s ordinary course of
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
business (originally under non-operating income) as other income as per Accounting Standard No. 16 for Business
Enterprises—Government Subsidies.
(15) The year-over-year decrease of -41.52% in non-operating expense to RMB7,260,398.00 during the period January through
September 2017 primarily resulted from decreased losses on disposal of non-current assets.
II Progress, Influence and Solutions Associated with Significant Events
□ Applicable √ Not applicable
III Commitments that the Company’s Actual Controller, Shareholders, Related Parties and
Acquirers, as well as the Company and Other Commitment Makers, Failed to Fulfill on Time
during Reporting Period
□ Applicable √ Not applicable
No such cases in the Reporting Period.
IV Forecast of 2017 Annual Operating Results
Warning of a possible loss on or a significant year-over-year change in accumulative net margin during the period the beginning of
the current year through the end of the next reporting period, as well as the reasons:
□ Applicable √ Not applicable
V Securities Investments
□ Applicable √ Not applicable
No such cases in the Reporting Period.
VI Investments in Derivative Financial Instruments
√ Applicable □ Not applicable
Unit: RMB'0,000
Proportion
Relate Openi Closin of closing
Impair Actual
d-part Initial ng Amount g investment
Type of Amount sold ment gain/loss
Relati y investme Beginning invest purchased in invest amount in
Operator derivative Ending date in Reporting provisi in
on transac nt date ment Reporting ment the
investment Period on (if Reportin
tion or amount amou Period amoun Company’s
any) g Period
not nt t closing net
assets (%)
Commer Forward
Non-re No 0 01/19/2017 09/29/2017 0 107,579.8 107,579.8 0 413.63
cial exchange
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
bank lated settlement
Commer Foreign
Non-re
cial No exchange 0 01/03/2017 09/05/2017 0 58,953.81 41,953.81 17,000 2.26% 25.49
lated
bank option
Forward
Commer
Non-re exchange
cial No 0 05/22/2017 07/14/2017 0 8,379.84 8,379.84 0 -7.49
lated transaction
bank
s
Commer Foreign
Non-re
cial No exchange 0 06/20/2017 06/30/2017 0 12,937.1 12,937.1 0 4.76
lated
bank swap
Total 0 -- -- 0 187,850.55 170,850.55 0 17,000 2.26% 436.39
Capital source for derivative
Own funds
investment
Lawsuit (if applicable) Naught
Disclosure date of board of directors
announcement on approval of 04/28/2017
derivative investment (if any)
Disclosure date of general meeting
of shareholders announcement on
approval of derivative investment
(if any)
The Company conducted derivatives products transaction in order for hedging. And the forward settlement
hedging was operated by installments, with the relevant amount not more than the planned derivatives products
transactions. And all derivatives products transaction was zero-deposit. Meanwhile, the Company had a
complete risk control system for sufficient analysis and prevention of possible risks such as risk of laws and
regulations, credit risk, operation risk and market risk.
1. Risk concerning laws and regulations:
The Company conducted derivatives products transaction in strict accordance with relevant laws and rules as
Analysis on risks and control
well as regulatory policies from government securities regulatory authorities, if there were no standard
measures of derivative products
operation procedures and strict approval procedures, it was easy to cause compliant and regulatory risks
held in the Reporting Period
existing in the validity and feasibility of contract, commitments and other legal documents signed. Risk control
(including but not limited to market
measures: The Company carefully studied and mastered laws, regulations and policies relevant to derivative
risk, liquidity risk, credit risk,
products transaction, formulated internal control rules for the forward settlement hedging business,
operation risk, law risk, etc.)
standardized the operation procedures. And strengthened the compliant examination on derivative products
investment business, and strictly abided by relevant laws, regulations and the Company’s internal management
rules.
2. Credit risk and liquidity risk:
When the contract matures, the Company couldn’t deliver as scheduled due to insufficient liquidity, and the
counterparty or the Company couldn’t fulfill the contract due to other aspects except the liquidity, which would
cause credit risk and further economic losses for the Company. Risk control measures: the Company chose the
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
powerful financial institutions with good reputation as the counterparty, and signed standard derivative
products transaction contract, as well as strictly controlled the credit risk of counterparty. The Company
conducted derivative investment transactions according to the relevant approval procedure, which was in line
with relevant laws, regulations, the Company’s Articles of Association, the Management Rules for Derivative
Investment of Lu Thai Textile Co., Ltd. and the Proposal on the Plan of the Company for Derivative
Transactions approved at the 7th Session of the 8th Board of Directors on April 26, 2017, and performed
relevant information disclosure responsibilities. The Company decided the up limit for the amount of
derivative products transaction according to the production and operation scale and the progress of foreign
exchange income for the Company, and delivered by phases. It was also possible to use extension of term and
other ways to ensure the fulfillment of contract as schedules upon the mature of contract, and wouldn’t cause
any loss of credit risk for the Company due to insufficient liquidity or other reasons.
3. Operation risk:
The derivative financial transactions had high specialty and complexity, so imperfect internal operation
procedures, staffs and external events would make the Company to undertake risks during the transaction. Risk
control measures: The Company promulgated strict authorization and approval system and perfect regulatory
mechanism, fixed the departments, operation procedures and approval procedures system to conduct derivative
products transaction, established special risk control positions, implemented strict authorization and post
checks and balances system, meanwhile, it improved the overall quality of relevant personnel through
strengthening the business training and professional ethics education for them. Besides, it established the
System of Reporting the Abnormal Situation Timely, formed an efficient risk management procedures, so as to
ensure to lower the operation risks to the maximum.
4. Market risk: since two years of "811 exchange rate reform", the central parity of RMB against US dollar
gradually formed the current price mechanism of "closing price + overnight basket of currency changes +
reverse cycle adjustment factor". The central parity has played a very good role in Price guideline, and the
effect of exchange rate reform is remarkable. In the short term, China's economy has gradually stabilized and
maintained high-speed growth. The internationalization of RMB is steadily advancing. Therefore, the RMB
exchange rate has neither the basis for devaluation nor the need for devaluation. In the long run, the dollar
index, customer trading behavior and market makers expectations are still key factors determining the future of
RMB exchange rate. In the future, the RMB exchange rate elasticity will increase, and the two-way fluctuation
will be obvious. Forward settlement and option business, which are greatly affected by exchange rate
fluctuations, are important derivatives transactions of the Company. Risk control measures: Although a more
flexible RMB exchange rate and the increased fluctuation range added to the operation difficulty, it provided a
certain opportunity. Therefore, the relevant personnel of the Company will actively analyze market changes,
carefully operate and hold positive opportunity, so as to try the best to reduce the market risks under the
condition of increased market difficulty.
Changes of market prices or fair 1. As of September 30, 2017, the Company held 7 undue financial derivatives contracts, with a total of USD26
values in the Reporting Period of million. The latest contract period will end in November 2017. Financial derivatives accounted for 2.26% of
the invested derivatives. And the the Company’s consolidated net assets at the end of the Reporting Period.
analysis on the fair value of the 2. During the period January through September 2017, the amount of the Company's due financial derivatives
derivatives should include the was equivalent to USD253,489,300, with proceeds of RMB4,363,900, of which due forward forex settlements
specific use methods and the amounted to USD157,881,800, with proceeds of RMB4,136,300; mature foreign exchange transactions were
relevant assumptions and equivalent to USD12,307,500, with a loss of RMB74,900; mature foreign exchange swaps amounted to
parameters. USD19 million, with proceeds of RMB47,600; and mature foreign currency options amounted to USD64.3
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
million, with proceeds of RMB254,900 after execution of contracts.
Whether significant changes
occurred to the Company’s
accounting policy and specific
No significant changes
accounting principles of derivatives
in the Reporting Period compared to
the previous Reporting Period
The Company’s independent directors Xu Jianjun, Zhao Yao, Bi Xiuli, Pan Ailing and Wang Xinyu,
concerning conducting derivatives business, have issued the following professional advice: We are of the
Specific opinion from independent opinion that it will strengthen the Company’s competitiveness to use derivative transactions with focus on
directors on the Company’s forward settlement and purchase as an effective tool to avoid foreign exchange risks, to strengthen the relevant
derivatives investment and risk internal control and to carry out the loss and risk prevention measures so as to improve the operation and
control management. In conducting derivative transactions with focus on forward settlement and purchase, the
Company follows a legal approval procedure, has sound relevant institutions and keeps the risks relatively
controllable. No harm has been done to the interests of the Company’s shareholders.
VII Visits Paid to the Company for Purposes of Research, Communication, Interview, etc.
during Reporting Period
√ Applicable □ Not applicable
Date of visit Way of visit Type of visitor About
08/30/2017 By phone Institution Company fundamentals
VIII Irregularities Arising from Provision of Guarantees for Third Parties
□ Applicable √ Not applicable
No such cases in the Reporting Period.
IX Occupation of the Company’s Funds by Its Controlling Shareholder or Related Parties for
Non-Operating Purposes
□ Applicable √ Not applicable
No such cases in the Reporting Period.
X Targeted Measures Taken to Help People Lift Themselves out of Poverty
The Company did not take such measures in the third quarter of the year and has no such plans for now.
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
Part IV Financial Statements
I Financial Statements
1. Consolidated Balance Sheet
Prepared by Lu Thai Textile Co., Ltd.
September 30, 2017
Unit: RMB
Item September 30, 2017 December 31, 2016
Current assets:
Cash on hand and at bank 664,007,740.98 662,967,785.49
Derivative financial assets
Notes receivable 65,749,428.30 84,161,909.91
Accounts receivable 304,887,703.37 293,129,727.93
Prepayments 152,861,983.08 212,487,501.51
Dividends receivable
Other accounts receivable 34,474,400.36 46,262,835.47
Financial assets purchased under agreements to resell
Inventories 1,890,682,210.49 1,816,700,441.85
Assets held for sale
Non-current assets due within one year
Other current assets 109,072,780.47 107,535,889.38
Total current assets 3,221,736,247.05 3,223,246,091.54
Non-current assets:
Available-for-sale financial assets 24,660,000.00 24,660,000.00
Held-to-maturity investments
Long-term accounts receivable 2,310,000.00 2,310,000.00
Long-term equity investments
Investment property 24,880,799.48 25,844,090.56
Fixed assets 5,093,113,348.63 5,244,335,459.80
Construction in progress 295,683,932.33 154,668,358.96
Engineering materials 143,497,488.76 117,120,463.50
Disposal of fixed assets
Productive living assets 1,314,468.02 1,381,292.75
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
Intangible assets 478,132,427.97 384,253,077.39
R&D expense
Goodwill 20,613,803.29 20,613,803.29
Long-term deferred expense 109,049,747.27 114,227,364.54
Deferred income tax assets 65,472,398.37 63,183,792.63
Other non-current assets 38,847,120.62 31,259,468.38
Total non-current assets 6,297,575,534.74 6,183,857,171.80
Total assets 9,519,311,781.79 9,407,103,263.34
Current liabilities:
Short-term borrowings 910,686,491.89 873,261,856.02
Financial liabilities at fair value through gains/losses 796,400.00
Derivative financial liabilities
Notes payable 5,850,646.86
Accounts payable 229,123,171.10 252,538,563.06
Advances received 103,748,135.51 89,451,314.62
Payroll payable 262,209,359.08 315,618,449.91
Taxes payable 50,890,407.93 77,214,706.67
Interest payable 1,493,933.99 1,165,730.47
Dividends payable 441,113.64 441,113.64
Other accounts payable 67,489,447.00 69,365,641.15
Non-current liabilities due within one year 135,950,175.68
Other current liabilities
Total current liabilities 1,768,679,282.68 1,679,057,375.54
Non-current liabilities:
Long-term borrowings 135,678,044.89
Long-term accounts payable
Long-term payroll payable 97,673,785.15 79,122,422.89
Special payables
Provisions
Deferred income 116,197,415.99 95,990,489.79
Deferred income tax liabilities 2,223,839.09 2,341,089.87
Other non-current liabilities 1,840,000.00 1,840,000.00
Total non-current liabilities 217,935,040.23 314,972,047.44
Total liabilities 1,986,614,322.91 1,994,029,422.98
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
Owners’ equity:
Share capital 922,602,311.00 922,602,311.00
Capital reserve 753,484,021.82 753,440,557.83
Less: Treasury shares
Other comprehensive income 26,122,877.09 53,293,544.89
Special reserve
Surplus reserve 888,761,783.04 888,761,783.04
Provisions for general risks
Retained earnings 4,448,695,006.49 4,319,887,532.43
Equity attributable to owners of the parent 7,039,665,999.44 6,937,985,729.19
Minority interests 493,031,459.44 475,088,111.17
Total owners’ equity 7,532,697,458.88 7,413,073,840.36
Total liabilities and owners’ equity 9,519,311,781.79 9,407,103,263.34
Legal representative: Liu Zibin Accounting head for this Report: Zhang Hongmei
Head of the accounting department: Zhang Keming
2. Parent Company Balance Sheet
Unit: RMB
Item September 30, 2017 December 31, 2016
Current assets:
Cash on hand and at bank 355,862,616.24 177,016,859.63
Financial assets at fair value through gains/losses
Derivative financial assets
Notes receivable 42,675,045.56 64,421,665.52
Accounts receivable 303,674,683.83 297,026,110.33
Prepayments 16,702,256.58 139,013,057.80
Interest receivable
Dividends receivable
Other accounts receivable 342,525,340.59 340,458,208.20
Inventories 1,234,631,072.97 1,086,364,931.72
Assets held for sale
Non-current assets due within one year
Other current assets 66,326,536.53 1,126,006.88
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
Total current assets 2,362,397,552.30 2,105,426,840.08
Non-current assets:
Available-for-sale financial assets 12,500,000.00 12,500,000.00
Held-to-maturity investments
Long-term accounts receivable
Long-term equity investments 1,718,956,616.04 1,711,021,866.04
Investment property 14,319,423.87 14,829,443.58
Fixed assets 2,836,580,993.63 3,019,132,803.64
Construction in progress 74,083,869.81 25,796,329.33
Engineering materials 8,100,222.03 663,894.82
Disposal of fixed assets
Productive living assets
Oil-gas assets
Intangible assets 227,427,941.39 229,433,475.02
R&D expense
Goodwill
Long-term deferred expense
Deferred income tax assets 58,069,929.44 62,042,513.61
Other non-current assets 32,021,313.12 8,831,098.34
Total non-current assets 4,982,060,309.33 5,084,251,424.38
Total assets 7,344,457,861.63 7,189,678,264.46
Current liabilities:
Short-term borrowings 587,762,670.98 503,005,010.24
Financial liabilities at fair value through gains/losses 340,500.00
Derivative financial liabilities
Notes payable 2,660,000.00
Accounts payable 152,492,638.17 158,737,347.81
Advances received 62,553,420.18 54,552,285.78
Payroll payable 195,928,957.34 240,389,712.34
Taxes payable 40,382,668.46 47,790,003.82
Interest payable 1,493,933.99 646,147.15
Dividends payable 441,113.64 441,113.64
Other accounts payable 25,377,074.63 19,309,386.42
Liabilities held for sale
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
Non-current liabilities due within one year
Other current liabilities
Total current liabilities 1,069,432,977.39 1,024,871,007.20
Non-current liabilities:
Long-term borrowings
Long-term payables
Long-term payroll payable 97,673,785.15 79,122,422.89
Special payables
Provisions
Deferred income 70,101,358.51 62,691,326.97
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities 167,775,143.66 141,813,749.86
Total liabilities 1,237,208,121.05 1,166,684,757.06
Owners’ equity:
Share capital 922,602,311.00 922,602,311.00
Capital reserve 759,836,702.91 759,793,238.92
Less: Treasury shares
Other comprehensive income
Special reserve
Surplus reserve 888,761,783.04 888,761,783.04
Retained earnings 3,536,048,943.63 3,451,836,174.44
Total owners’ equity 6,107,249,740.58 6,022,993,507.40
Total liabilities and owners’ equity 7,344,457,861.63 7,189,678,264.46
3. Consolidated Income Statement for July-September
Unit: RMB
Item July-September 2017 July-September 2016
1. Operating revenue 1,631,824,401.03 1,433,914,063.96
Including: Net sales 1,631,824,401.03 1,433,914,063.96
2. Operating expenses 1,412,304,915.71 1,150,074,108.90
Including: Cost of sales 1,168,416,403.13 931,426,457.61
Taxes and surtaxes 22,197,277.47 15,917,689.81
Selling expense 36,919,797.86 35,754,052.90
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
Administrative expense 168,529,612.71 153,044,613.01
Finance costs 13,877,588.58 6,546,510.69
Asset impairment losses 2,364,235.96 7,384,784.88
Add: Gains on fair value changes (“-” for losses) -1,907,100.00 15,450,886.80
Investment income (“-” for losses) 2,978,343.01 -9,313,278.13
Including: Share of gains/losses of associates and joint ventures
Exchange gains (“-” for losses)
Other income 19,984,685.38
3. Operating margin (“-” for losses) 240,575,413.71 289,977,563.73
Add: Non-operating income 5,401,592.64 12,347,357.12
Including: Gains on disposal of non-current assets 4,964,497.03 343,842.01
Less: Non-operating expense 1,340,575.40 4,696,674.72
Including: Losses on disposal of non-current assets 1,141,689.35 2,530,749.32
4. Gross margin (“-” for losses) 244,636,430.95 297,628,246.13
Less: Income tax expense 34,958,315.84 48,157,938.49
5. Net margin (“-” for losses) 209,678,115.11 249,470,307.64
Attributable to owners of the parent 197,038,648.01 236,519,891.59
Attributable to minority interests 12,639,467.10 12,950,416.05
6. Other comprehensive income, net of tax -12,385,575.90 4,893,753.80
Other comprehensive income, net of tax attributable to owners of
-12,385,575.90 4,893,753.80
the parent
6.1 Other comprehensive income that will not be reclassified
into gains/losses
6.1.1 Changes in net liabilities or assets with a defined benefit
plan upon re-measurement
6.1.2 Share of other comprehensive income of investees that
cannot be reclassified into gains/losses under equity method
6.2 Other comprehensive income to be subsequently reclassified
-12,385,575.90 4,893,753.80
into gains/losses
6.2.1 Share of other comprehensive income of investees that
will be reclassified into gains/losses under equity method
6.2.2 Gains/Losses on fair value changes of available-for-sale
financial assets
6.2.3 Gains/Losses on reclassifying held-to-maturity
investments into available-for-sale financial assets
6.2.4 Effective gains/losses on cash flow hedges
6.2.5 Currency translation differences -12,385,575.90 4,893,753.80
6.2.6 Other
17
Lu Thai Textile Co., Ltd. Third Quarter Report 2017
Other comprehensive income, net of tax attributable to minority
interests
7. Total comprehensive income 197,292,539.21 254,364,061.44
Attributable to owners of the parent 184,653,072.11 241,413,645.39
Attributable to minority interests 12,639,467.10 12,950,416.05
8. Earnings per share
8.1 Basic earnings per share 0.21 0.25
8.2 Diluted earnings per share 0.21 0.25
Where business mergers under the same control occurred in the current period, the net margin achieved by the merged parties before
the business mergers was RMB0.00, with the amount for the same period of last year being RMB0.00.
Legal representative: Liu Zibin Accounting head for this Report: Zhang Hongmei
Head of the accounting department: Zhang Keming
4. Parent Company Income Statement for July-September
Unit: RMB
Item July-September 2017 July-September 2016
1. Operating revenue 1,303,731,449.01 1,315,386,535.04
Less: Operating expenses 961,017,334.09 940,723,865.92
Taxes and surtaxes 17,222,805.08 11,201,820.01
Selling expense 24,575,700.30 21,763,178.49
Administrative expense 113,871,284.77 104,337,849.19
Finance costs 5,369,029.33 4,368,954.01
Asset impairment losses -5,188,148.15 6,584,893.25
Add: Gains on fair value changes (“-” for losses) -1,451,200.00 9,735,700.00
Investment income (“-” for loss) 2,993,963.01 8,176,633.62
Including: Share of gains/losses of associates and joint ventures
Other income 14,886,733.13
2. Operating margin (“-” for losses) 203,292,939.73 244,318,307.79
Add: Non-operating income 423,329.65 8,870,631.85
Including: Gains on disposal of non-current assets 59,955.79 157,408.00
Less: Non-operating expense 337,686.69 1,346,406.41
Including: Losses on disposal of non-current assets 273,302.41 966,221.16
3. Gross margin (“-” for losses) 203,378,582.69 251,842,533.23
Less: Income tax expense 31,561,713.67 32,559,112.92
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
4. Net margin (“-” for losses) 171,816,869.02 219,283,420.31
5. Other comprehensive income, net of tax
5.1 Other comprehensive income that will not be reclassified into
gains and losses
5.1.1 Changes in net liabilities or assets with a defined benefit plan
upon re-measurement
5.1.2 Share of other comprehensive income of investees that
cannot be reclassified into gains/losses under equity method
5.2 Other comprehensive income to be subsequently reclassified into
gains/losses
5.2.1 Share of other comprehensive income of investees that will
be reclassified into gains/losses under equity method
5.2.2 Gains/Losses on fair value changes of available-for-sale
financial assets
5.2.3 Gains/Losses on reclassifying held-to-maturity investments
into available-for-sale financial assets
5.2.4 Effective gains/losses on cash flow hedges
5.2.5 Currency translation differences
5.2.6 Other
6. Total comprehensive income 171,816,869.02 219,283,420.31
7. Earnings per share
7.1 Basic earnings per share 0.18 0.25
7.2 Diluted earnings per share 0.18 0.25
5. Consolidated Income Statement for January-September
Unit: RMB
Item January-September 2017 January-September 2016
1. Operating revenue 4,622,284,097.46 4,265,240,836.99
Including: Net sales 4,622,284,097.46 4,265,240,836.99
2. Operating expenses 3,926,259,381.41 3,560,005,447.57
Including: Cost of sales 3,218,355,617.76 2,868,826,048.69
Taxes and surtaxes 73,695,429.20 40,718,418.33
Selling expense 105,285,310.08 124,463,716.40
Administrative expense 480,999,924.65 494,816,568.17
Finance costs 44,572,889.12 26,357,253.37
Asset impairment losses 3,350,210.60 4,823,442.61
Add: Gains on fair value changes (“-” for losses) -796,400.00 46,397,456.20
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
Investment income (“-” for losses) 4,803,678.35 -42,954,499.35
Including: Share of gains/losses of associates and joint ventures
Exchange gains (“-” for losses)
Other income 30,565,322.67
3. Operating margin (“-” for losses) 730,597,317.07 708,678,346.27
Add: Non-operating income 9,846,350.62 33,540,794.44
Including: Gains on disposal of non-current assets 5,044,311.76 572,155.31
Less: Non-operating expense 7,260,398.00 12,415,314.62
Including: Losses on disposal of non-current assets 3,193,741.22 7,942,874.57
4. Gross margin (“-” for losses) 733,183,269.69 729,803,826.09
Less: Income tax expense 113,607,725.48 137,676,433.01
5. Net margin (“-” for losses) 619,575,544.21 592,127,393.08
Attributable to owners of the parent 590,108,629.56 581,161,076.32
Attributable to minority interests 29,466,914.65 10,966,316.76
6. Other comprehensive income, net of tax -27,170,667.80 17,283,510.42
Other comprehensive income, net of tax attributable to owners of the
-27,170,667.80 17,283,510.42
parent
6.1 Other comprehensive income that will not be reclassified into
gains/losses
6.1.1 Changes in net liabilities or assets with a defined benefit
plan upon re-measurement
6.1.2 Share of other comprehensive income of investees that
cannot be reclassified into gains/losses under equity method
6.2 Other comprehensive income to be subsequently reclassified
-27,170,667.80 17,283,510.42
into gains/losses
6.2.1 Share of other comprehensive income of investees that
will be reclassified into gains/losses under equity method
6.2.2 Gains/Losses on fair value changes of available-for-sale
financial assets
6.2.3 Gains/Losses on reclassifying held-to-maturity
investments into available-for-sale financial assets
6.2.4 Effective gains/losses on cash flow hedges
6.2.5 Currency translation differences -27,170,667.80 17,283,510.42
6.2.6 Other
Other comprehensive income, net of tax attributable to minority
interests
7. Total comprehensive income 592,404,876.41 609,410,903.50
Attributable to owners of the parent 562,937,961.76 598,444,586.74
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
Attributable to minority interests 29,466,914.65 10,966,316.76
8. Earnings per share
8.1 Basic earnings per share 0.64 0.62
8.2 Diluted earnings per share 0.64 0.62
Where business mergers under the same control occurred in the current period, the net margin achieved by the merged parties before
the business mergers was RMB0.00, with the amount for the same period of last year being RMB0.00.
6. Parent Company Income Statement for January-September
Unit: RMB
Item January-September 2017 January-September 2016
1. Operating revenue 3,786,055,037.81 3,684,048,403.41
Less: Operating expenses 2,727,698,358.16 2,635,365,848.72
Taxes and surtaxes 54,700,584.26 27,687,609.47
Selling expense 67,896,475.33 63,206,677.11
Administrative expense 324,306,711.39 344,966,347.49
Finance costs 13,738,799.16 21,307,487.42
Asset impairment losses -4,926,016.45 34,867,799.94
Add: Gains on fair value changes (“-” for losses) -340,500.00 39,527,800.00
Investment income (“-” for loss) 22,252,360.62 18,551,262.92
Including: Share of gains/losses of associates and joint ventures
Other income 20,055,788.46
2. Operating margin (“-” for losses) 644,607,775.04 614,725,696.18
Add: Non-operating income 2,710,209.13 17,060,151.08
Including: Gains on disposal of non-current assets 139,770.52 339,790.68
Less: Non-operating expense 4,596,651.72 2,854,467.72
Including: Losses on disposal of non-current assets 791,398.32 1,036,036.68
3. Gross margin (“-” for losses) 642,721,332.45 628,931,379.54
Less: Income tax expense 97,207,407.76 92,329,061.54
4. Net margin (“-” for losses) 545,513,924.69 536,602,318.00
5. Other comprehensive income, net of tax
5.1 Other comprehensive income that will not be reclassified into gains
and losses
5.1.1 Changes in net liabilities or assets with a defined benefit plan
upon re-measurement
5.1.2 Share of other comprehensive income of investees that cannot
be reclassified into gains/losses under equity method
21
Lu Thai Textile Co., Ltd. Third Quarter Report 2017
5.2 Other comprehensive income to be subsequently reclassified into
gains/losses
5.2.1 Share of other comprehensive income of investees that will be
reclassified into gains/losses under equity method
5.2.2 Gains/Losses on fair value changes of available-for-sale
financial assets
5.2.3 Gains/Losses on reclassifying held-to-maturity investments
into available-for-sale financial assets
5.2.4 Effective gains/losses on cash flow hedges
5.2.5 Currency translation differences
5.2.6 Other
6. Total comprehensive income 545,513,924.69 536,602,318.00
7. Earnings per share
7.1 Basic earnings per share 0.59 0.58
7.2 Diluted earnings per share 0.59 0.58
7. Consolidated Cash Flow Statement for January-September
Unit: RMB
Item January-September 2017 January-September 2016
1. Cash generated by or used in operating activities:
Cash generated by sale of commodities and rendering of service 4,572,921,342.11 4,451,363,023.15
Tax rebates received 160,047,008.71 165,676,563.92
Cash generated by other operating activities 86,665,078.72 57,644,929.87
Subtotal of cash generated by operating activities 4,819,633,429.54 4,674,684,516.94
Cash paid for goods and services 2,296,716,476.86 1,978,778,368.73
Cash paid to and for employees 1,187,553,253.81 1,137,718,925.60
Taxes paid 270,659,130.79 281,057,146.80
Cash used in other operating activities 230,674,659.51 185,894,867.97
Subtotal of cash used in operating activities 3,985,603,520.97 3,583,449,309.10
Net cash from operating activities 834,029,908.57 1,091,235,207.84
2. Cash generated by or used in investing activities:
Cash generated by disinvestments
Cash received as investment income 439,800.00
Net cash generated by disposal of fixed assets, intangible assets and
11,449,301.27 842,448.48
other long-term assets
Net cash generated by disposal of subsidiaries or other business units
22
Lu Thai Textile Co., Ltd. Third Quarter Report 2017
Cash generated by other investing activities 72,404,070.11 13,887,173.29
Subtotal of cash generated by investing activities 84,293,171.38 14,729,621.77
Cash paid to acquire fixed assets, intangible assets and other long-term
426,037,743.55 581,218,810.56
assets
Cash paid for investments 50,000,000.00
Net increase in pledged loans
Net cash paid to acquire subsidiaries and other business units
Cash used in other investing activities 54,534,930.05
Subtotal of cash used in investing activities 476,037,743.55 635,753,740.61
Net cash from investing activities -391,744,572.17 -621,024,118.84
3. Cash generated by or used in financing activities:
Cash received as capital contributions 500,000.00
Including: Cash received from minority shareholder investments by
500,000.00
subsidiaries
Cash received as borrowings 1,255,806,409.19 1,634,550,537.14
Cash generated by issuance of bonds
Cash generated by other financing activities 13,000,000.00 29,805,722.42
Subtotal of cash generated by financing activities 1,269,306,409.19 1,664,356,259.56
Repayment of borrowings 1,197,843,204.46 1,550,854,947.76
Cash paid for interest expenses and distribution of dividends or profit 491,099,353.46 489,969,687.54
Including: dividends or profit paid by subsidiaries to minority interests
Cash used in other financing activities 253,869,811.31
Sub-total of cash used in financing activities 1,688,942,557.92 2,294,694,446.61
Net cash from financing activities -419,636,148.73 -630,338,187.05
4. Effect of foreign exchange rate changes on cash and cash equivalents -13,870,445.11 6,874,499.12
5. Net increase in cash and cash equivalents 8,778,742.56 -153,252,598.93
Add: Opening balance of cash and cash equivalents 654,967,785.49 765,695,473.65
6. Closing balance of cash and cash equivalents 663,746,528.05 612,442,874.72
8. Parent Company Cash Flow Statement for January-September
Unit: RMB
Item January-September 2017 January-September 2016
1. Cash generated by or used in operating activities:
Cash generated by sale of commodities and rendering of service 3,755,654,197.80 3,650,560,016.13
Tax rebates received 111,127,591.41 133,011,154.02
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Lu Thai Textile Co., Ltd. Third Quarter Report 2017
Cash generated by other operating activities 34,568,683.53 18,157,684.20
Subtotal of cash generated by operating activities 3,901,350,472.74 3,801,728,854.35
Cash paid for goods and services 2,083,382,104.36 1,659,351,293.65
Cash paid to and for employees 850,651,997.04 834,261,504.20
Taxes paid 152,018,949.10 134,020,301.87
Cash used in other operating activities 116,969,182.67 101,580,257.81
Subtotal of cash used in operating activities 3,203,022,233.17 2,729,213,357.53
Net cash from operating activities 698,328,239.57 1,072,515,496.82
2. Cash generated by or used in investing activities:
Cash generated by disinvestments
Cash received as investment income 17,976,433.62 55,177,682.68
Net cash generated by disposal of fixed assets, intangible assets and
1,452,306.27 637,067.58
other long-term assets
Net cash generated by disposal of subsidiaries or other business units
Cash generated by other investing activities 299,727,304.86 2,473,750.44
Subtotal of cash generated by investing activities 319,156,044.75 58,288,500.70
Cash paid to acquire fixed assets, intangible assets and other long-term
69,903,614.65 139,406,268.44
assets
Cash paid for investments 57,934,750.00 137,814,270.00
Net cash paid to acquire subsidiaries and other business units
Cash used in other investing activities 328,724,000.00 37,432,400.00
Subtotal of cash used in investing activities 456,562,364.65 314,652,938.44
Net cash from investing activities -137,406,319.90 -256,364,437.74
3. Cash generated by or used in financing activities:
Cash received as capital contributions
Cash received as borrowings 961,360,949.88 1,246,734,806.62
Cash generated by issuance of bonds
Cash generated by other financing activities
Subtotal of cash generated by financing activities 961,360,949.88 1,246,734,806.62
Repayment of borrowings 873,419,137.33 1,252,422,309.64
Cash paid for interest expenses and distribution of dividends or profit 468,208,196.66 472,425,946.46
Cash used in other financing activities 430,854,881.31
Sub-total of cash used in financing activities 1,341,627,333.99 2,155,703,137.41
Net cash from financing activities -380,266,384.11 -908,968,330.79
4. Effect of foreign exchange rate changes on cash and cash equivalents -1,809,778.95 -1,843,889.67
24
Lu Thai Textile Co., Ltd. Third Quarter Report 2017
5. Net increase in cash and cash equivalents 178,845,756.61 -94,661,161.38
Add: Opening balance of cash and cash equivalents 177,016,859.63 361,326,403.14
6. Closing balance of cash and cash equivalents 355,862,616.24 266,665,241.76
II Auditor’s Report
Are the Q3 2017 financial statements audited?
□Yes √ No
These financial statements are unaudited.
Board Chairman (signature): Liu Zibin
Lu Thai Textile Co., Ltd.
October 27, 2017
25
