2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Financial Report
1. Audit report
Whether the semiannual report has been audited
□ Yes √ No
2. Financial statement
The unit in the statements of the financial annotations is RMB Yuan.
2.1 Consolidated balance sheet
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd. June 30, 2021 Unit: Yuan
Item Note June 30, 2021 December 31, 2020
Current assets:
Monetary fund 7.1 1,513,731,040 1,194,214,929
Settlement reserves
Lending funds
Tradable financial assets
Derivative financial assets
Bills receivable
Accounts receivable 7.2 169,236,257 183,853,362
Receivables financing 7.3 338,278,251 338,090,187
Advance payment 7.4 8,027,712 71,296,416
Premium receivable
Reinsurance accounts receivable
Receivable reserves for reinsurance contract
Other receivables 7.5 22,861,668 22,428,956
Including: Interest receivable
Dividends receivable
Redemptory monetary capital for sale
Inventories 7.6 2,920,940,415 2,945,548,651
Contract assets
Assets held for sale
Non-current assets due within one year
Other current assets 7.7 220,460,751 234,118,715
Total current assets 5,193,536,094 4,989,551,216
Non-current assets:
Offering loans and imprest
Debt investments
Other debt investments
Long-term receivables
Long-term equity investments 7.8 47,159,727 48,263,507
Other investments in equity instruments
Other non-current financial assets
Investment real estate 7.9 25,470,474 27,057,730
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Note June 30, 2021 December 31, 2020
Fixed assets 7.10 5,674,883,742 5,724,935,846
Construction in progress 7.11 670,705,216 635,495,152
Productive biological assets 7.12 190,183,036 192,173,536
Oil-and-gas assets
Right-of-use assets 7.13 110,547,744
Intangible assets 7.14 651,746,519 660,989,065
Development expenditure
Goodwill 7.15 132,938,212 132,938,212
Long-term prepaid expenses 7.16 332,133,295 314,465,855
Deferred income tax assets 7.17 181,479,059 206,241,275
Other non-current assets 7.18 158,377,754 170,370,147
Total non-current assets 8,175,624,778 8,112,930,325
Total assets 13,369,160,872 13,102,481,541
Current liabilities:
Short-term loans 7.19 716,361,680 689,090,715
Borrowings from the Central Bank
Loans from other banks and other financial institutions
Tradable financial liabilities
Derivative financial liabilities
Bills payable
Accounts payable 7.20 409,887,533 484,347,958
Advances from customers
Contract liabilities 7.21 108,304,501 135,073,280
Financial assets sold for repurchase
Deposits from customers and interbank
Receivings from vicariously traded securities
Receivings from vicariously sold securities
Employee remunerations payable 7.22 139,388,230 188,779,911
Taxes and dues payable 7.23 161,200,580 213,412,813
Other payables 7.24 683,062,474 386,105,526
Including: Interest payable 2,289,564 553,471
Dividends payable 274,507,652 1,003,125
Handling charges and commissions payable
Dividend payable for reinsurance
Liabilities held for sale
Non-current liabilities due within one year 7.25 125,279,691 133,311,890
Other current liabilities 7.26 14,000,154 14,820,653
Total current liabilities 2,357,484,843 2,244,942,746
Non-current liabilities:
Reserves for insurance contracts
Long-term borrowings 7.27 202,741,846 200,352,968
Bonds payable
Including: Preferred stock
Perpetual bonds
Lease liabilities 7.28 111,337,332
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Note June 30, 2021 December 31, 2020
Long-term accounts payable 7.29 64,000,000 86,000,000
Long-term employee remunerations payable
Estimated liabilities
Deferred income 7.30 45,454,375 52,653,609
Deferred income tax liabilities 7.17 11,873,395 12,022,613
Other non-current liabilities 7.31 2,078,971 2,078,971
Total non-current liabilities 437,485,919 353,108,161
Total liabilities 2,794,970,762 2,598,050,907
Owner’s equity:
Capital stock 7.32 685,464,000 685,464,000
Other equity instruments
Including: Preferred stock
Perpetual bonds
Capital surplus 7.33 524,968,760 524,968,760
Minus: Treasury stock
Other comprehensive income 7.34 -21,042,366 576,129
Special reserves
Surplus reserves 7.35 342,732,000 342,732,000
General risk preparation
Undistributed profit 7.36 8,801,095,552 8,714,091,755
Total owner’s equities attributable to the parent company 10,333,217,946 10,267,832,644
Minority equity 240,972,164 236,597,990
Total owner’s equities 10,574,190,110 10,504,430,634
Total liabilities and owner’s equities 13,369,160,872 13,102,481,541
Legal Representative: Zhou Hongjiang Accounting Supervisor: Jiang Jianxun Accounting Department Manager: Guo Cuimei
2.2 Balance sheet of the parent company
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd. Unit: Yuan
Item Note June 30, 2021 December 31, 2020
Current assets:
Monetary fund 616,538,061 267,548,326
Tradable financial assets
Derivative financial assets
Bills receivable
Accounts receivable 17.1 69,805
Receivables financing 31,148,514 13,920,000
Advance payment 1,475,764 171,709
Other receivables 17.2 271,659,240 580,131,798
Including: Interest receivable
Dividends receivable 200,000,000
Inventories 458,649,317 482,442,935
Contract assets
Assets held for sale
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Note June 30, 2021 December 31, 2020
Non-current assets due within one year
Other current assets 25,156,377 24,842,325
Total current assets 1,404,697,078 1,369,057,093
Non-current assets:
Debt investments
Other debt investments
Long-term receivables
Long-term equity investments 17.3 7,599,301,118 7,599,778,880
Other investments in equity instruments
Other non-current financial assets
Investment real estate 25,470,474 27,057,730
Fixed assets 235,857,615 243,634,747
Construction in progress 259,132 2,865,243
Productive biological assets 115,113,721 115,103,753
Oil and gas assets
Right-of-use assets 43,293,228
Intangible assets 79,416,810 80,789,731
Development expenditure
Goodwill
Long-term prepaid expenses
Deferred income tax assets 15,270,673 18,285,685
Other non-current assets 1,820,700,000 1,530,700,000
Total non-current assets 9,934,682,771 9,618,215,769
Total assets 11,339,379,849 10,987,272,862
Current liabilities:
Short-term loans 150,000,000 150,000,000
Tradable financial liabilities
Derivative financial liabilities
Bills payable
Accounts payable 43,145,258 76,470,081
Advances from customers
Contract liabilities
Employee remunerations 57,210,645 67,808,910
Taxes and dues payable 2,826,925 9,123,959
Other payables 664,761,829 521,505,947
Including: Interest payable 139,583 181,250
Dividends payable 274,185,600
Liabilities held for sale
Non-current liabilities due within one year 3,688,236
Other current liabilities
Total current liabilities 921,632,893 824,908,897
Non-current liabilities:
Long-term borrowings
Bonds payable
Including: Preferred stock
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Note June 30, 2021 December 31, 2020
Perpetual bonds
Lease liabilities 45,412,927
Long-term accounts payable
Long-term employee remuneration payable
Estimated liabilities
Deferred income 3,651,213 5,507,708
Deferred income tax liabilities 88,555
Other non-current liabilities 1,164,471 1,164,471
Total non-current liabilities 50,317,166 6,672,179
Total liabilities 971,950,059 831,581,076
Owner’s equity:
Capital stock 685,464,000 685,464,000
Other equity instruments
Including: Preferred stock
Perpetual bonds
Capital surplus 560,182,235 560,182,235
Minus: Treasury stock
Other comprehensive income
Special reserves
Surplus reserves 342,732,000 342,732,000
Undistributed profit 8,779,051,555 8,567,313,551
Total owner’s equities 10,367,429,790 10,155,691,786
Total liabilities and owner’s equities 11,339,379,849 10,987,272,862
Legal Representative: Zhou Hongjiang Accounting Supervisor: Jiang Jianxun Accounting Department Manager: Guo Cuimei
2.3 Consolidated profit statement
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd. Unit: Yuan
Item Note Sum of current period Sum of prior period
1. Total operating income 1,874,460,437 1,418,548,547
Including: Operating income 7.37 1,874,460,437 1,418,548,547
Interest income
Earned premium
Handling fee and commission income
2. Total operating costs 1,385,344,667 1,043,027,624
Including: Operating costs 7.37 761,513,544 574,858,339
Interest expenditure
Handling fees and commission expenditure
Premium rebate
Net amount of indemnity expenditure
Net amount of the withdrawn reserve fund for insurance
contract
Policy bonus payment
Amortized reinsurance expenditures
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Note Sum of current period Sum of prior period
Taxes and surcharges 7.38 100,220,017 88,443,822
Selling expenses 7.39 388,385,610 252,912,204
Administrative expenses 7.40 123,384,629 113,069,869
Research and development expenses 7.41 2,477,835 1,805,988
Financial expenses 7.42 9,363,032 11,937,402
Including: Interest expenses 14,239,535 14,891,310
Interest income 5,827,243 6,146,409
Plus: Other profit 7.43 21,978,695 50,780,231
Investment profit (loss is listed with “-") 7.44 -1,621,780 -1,170,685
Including: Investment profit for joint-run
-1,621,780 -1,170,685
business and joint venture
Financial assets measured at
amortized cost cease to be recognized
as income
Exchange income (loss is listed with “-")
Net exposure hedge income (loss is listed with
“-")
Income from fair value changes (loss is listed
with “-")
Credit impairment loss (loss is listed with “-") 7.45 -6,176,948 -533,145
Asset impairment loss (loss is listed with “-") 7.46 3,680,018 4,242,813
Income from asset disposal (loss is listed with 7.47
24,148
“-")
3. Operating profit (loss is listed with “-") 506,975,755 428,864,285
Plus: Non-operating income 7.48 2,488,778 6,686,519
Minus: Non-operating expenses 7.49 569,721 1,026,474
4. Total profits (total loss is listed with “-") 508,894,812 434,524,330
Minus: Income tax expenses 7.50 136,579,849 113,453,948
5. Net profit (net loss is listed with “-") 372,314,963 321,070,382
5.1 Classification by operation continuity
5.1.1 Net profit from continuing operation (net loss is
372,314,963 321,070,382
listed with “-")
5.1.2 Net profit from terminating operation (net loss
is listed with “-")
5.2 Classification by ownership
5.2.1 Net profit attributable to owner of the parent
371,821,819 318,640,075
company
5.2.2 Minority interest income 493,144 2,430,307
6. Net after-tax amount of other comprehensive income 7.51 -24,776,238 -5,765,822
Net after-tax amount of other comprehensive income
-21,618,495 -5,006,653
attributable to owner of the parent company
6.1 Other comprehensive income not to be reclassified
into profit and loss later
6.1.1 Changes after remeasuring and resetting the benefit
plans
6.1.2 Other comprehensive income not to be reclassified
into profit and loss under equity law
6.1.3 Changes in the fair value of other investments in
equity instruments
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Note Sum of current period Sum of prior period
6.1.4 Changes in the fair value of the enterprise's own
credit risk
6.1.5 Other
6.2 Other comprehensive income to be reclassified into
-21,618,495 -5,006,653
profit and loss later
6.2.1 Other comprehensive income to be reclassified into
profit and loss under equity law
6.2.2 Changes in the fair value of other debt investments
6.2.3 Amount of financial assets reclassified into other
comprehensive income
6.2.4 Provision for credit impairment of other credit
investments
6.2.5 Provision for cash-flow hedge
6.2.6 Difference in translation of Foreign Currency
-21,618,495 -5,006,653
Financial Statement
6.2.7 Other
Net after-tax amount of other comprehensive income
-3,157,743 -759,169
attributable to minority shareholders
7. Total comprehensive income 347,538,725 315,304,560
Attributable to owner of the parent company 350,203,324 313,633,422
Attributable to minority shareholders -2,664,599 1,671,138
8. Earnings per share:
8.1 Basic earnings per share 0.54 0.46
8.2 Diluted earnings per share 0.54 0.46
Legal Representative: Zhou Hongjiang Accounting Supervisor: Jiang Jianxun Accounting Department Manager: Guo Cuimei
2.4 Profit statement of the parent company
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd. Unit: Yuan
Item Note Sum of current period Sum of prior period
1. Operating income 17.4 206,300,566 152,950,515
Minus: Operating costs 17.4 169,012,171 143,241,194
Taxes and surcharges 11,779,088 4,379,365
Selling expenses
Administrative expenses 29,404,865 30,150,311
Research and development expenses 522,997 318,917
Financial expenses 1,903,108 934,777
Including: Interest expenses 3,316,692 2,807,750
Interest income 1,700,240 2,251,235
Plus: Other profit 3,949,823 1,819,890
Investment profit (loss is listed with “-") 17.5 494,528,070 87,474,604
Including: Investment profit for joint-run
-477,762
business and joint venture
Financial assets measured at
amortized cost cease to be recognized
as income (loss is listed with “-")
Net exposure hedge income (loss is listed with
“-")
Income from fair value changes (loss is listed
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Note Sum of current period Sum of prior period
with “-")
Credit impairment loss (loss is listed with “-") -443 -71,879
Asset impairment loss (loss is listed with “-") 671,511
Income from asset disposal (loss is listed with -30,921
“-")
2. Operating profit (loss is listed with “-") 492,124,866 63,820,077
Plus: Non-operating income 83,440 2,007,235
Minus: Non-operating expenses 371,527 525,000
3. Total profits (total loss is listed with “-") 491,836,779 65,302,312
Minus: Income tax expenses -376,545 -5,644,794
4. Net profit (net loss is listed with “-") 492,213,324 70,947,106
4.1Net profit from continuing operation (net loss is
492,213,324 70,947,106
listed with “-")
4.2 Net profit from terminating operation (net loss is
listed with “-")
5. Net after-tax amount of other comprehensive income
5.1 Other comprehensive income not to be reclassified
into profit and loss later
5.1.1 Changes after remeasuring and resetting the benefit
plans
5.1.2 Other comprehensive income not to be reclassified
into profit and loss under equity law
5.1.3 Changes in the fair value of other investments in
equity instruments
5.1.4 Changes in the fair value of the enterprise's own
credit risk
5.1.5 Other
5.2 Other comprehensive income to be reclassified into
profit and loss later
5.2.1 Other comprehensive income to be reclassified into
profit and loss under equity law
5.2.2 Changes in the fair value of other debt investments
5.2.3 Amount of financial assets reclassified into other
comprehensive income
5.2.4 Provision for credit impairment of other credit
investments
5.2.5 Provision for cash-flow hedge
5.2.6 Difference in translation of Foreign Currency
Financial Statement
5.2.7 Other
6. Total comprehensive income 492,213,324 70,947,106
7. Earnings per share:
7.1 Basic earnings per share 0.72 0.10
7.2 Diluted earnings per share 0.72 0.10
Legal Representative: Zhou Hongjiang Accounting Supervisor: Jiang Jianxun Accounting Department Manager: Guo Cuimei
2.5 Consolidated cash flow statement
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd. Unit: Yuan
Item Note Sum of current period Sum of prior period
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Note Sum of current period Sum of prior period
1. Cash flows from operating activities:
Cash received from sales of goods and rending of services 1,888,979,284 1,507,726,721
Net increase in customer and interbank deposits
Net increase in borrowings from central bank
Net increase in borrowings from other financial
institutions
Cash received from receiving insurance premium of
original insurance contract
Net cash received from reinsurance business
Net increase in policy holder deposits and investment
funds
Cash received from collecting interest, handling fees and
commissions
Net increase in borrowing funds
Net increase in repurchasement business funds
Net cash received for buying and selling securities
Tax refund received 25,489,549 23,217,782
Other cash received related to operating activities 7.52 26,262,022 47,768,202
Subtotal of cash flows of operating activities 1,940,730,855 1,578,712,705
Cash paid for goods and services 528,698,794 632,477,833
Net increase in customer loans and advances
Net increase in deposits in central bank and interbank
deposits
Cash paid to original insurance contract payments
Net increase in lending funds
Cash paid to interest, handling fees and commissions
Cash paid to policy bonus
Cash paid to and on behalf of employees 260,016,591 240,815,653
Cash paid for taxes and expenses 429,710,784 470,110,699
Other cash paid related to operating activities 7.52 266,369,537 251,827,272
Sub-total of cash outflows of operating activities 1,484,795,706 1,595,231,457
Net cash flow from operating activities 455,935,149 -16,518,752
2. Cash flow from investing activities:
Cash received from disinvestment
Cash received from withdrawal of fixed deposits 5,200,000 60,128,600
Cash received from obtaining investment income
Cash received from obtaining interest income 97,241 1,160,244
Cash received from disposal of fixed assets, intangible
11,531 2,760
assets and other long-term assets
Net cash received from disposal of branch and other
business unit
Other cash received related to investing activities
Subtotal of cash flows of investment activities 5,308,772 61,291,604
Cash paid to acquire fixed assets, intangible assets and
112,686,656 68,181,643
other long-term assets
Cash for investment 518,000 858,326
Cash paid for purchasing fixed deposits 5,200,000 35,200,000
Net increase in hypothecated loan
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Note Sum of current period Sum of prior period
Net cash paid for acquiring branch and other business unit
Other cash paid related to investment activities
Subtotal of cash outflows of investment activities 118,404,656 104,239,969
Net cash flow from investing activities -113,095,884 -42,948,365
3. Cash flow from financing activities
Cash received from acquiring investment 7,430,000
Including: cash received from acquiring minority
7,430,000
shareholders investment by branch
Cash received from acquiring loans 596,450,339 778,228,305
Other cash received related to financing activities 21,654,861
Subtotal cash flows of financing activities 625,535,200 778,228,305
Cash paid for paying debts 609,426,516 758,287,985
Cash paid for distributing dividend and profit or paying
11,683,409 24,177,706
interest
Including: dividend and profit paid to minority
1,551,687
shareholders by branch
Other cash paid related to financing activities 7,144,318
Subtotal of cash outflows of financing activities 628,254,243 782,465,691
Net cash flow from financing activities -2,719,043 -4,237,386
4. Influences of exchange rate fluctuation on cash and
-400,533 -307,959
cash equivalents
5. Net Increase in cash and cash equivalents 339,719,689 -64,012,462
Plus: balance at the beginning of the period of cash and
1,052,665,105 1,397,399,469
cash equivalents
6. Balance at the end of the period of cash and cash
1,392,384,794 1,333,387,007
equivalents
Legal Representative: Zhou Hongjiang Accounting Supervisor: Jiang Jianxun Accounting Department Manager: Guo Cuimei
2.6 Cash flow statement of the parent company
Compiling unit: Yantai Changyu Pioneer Wine Co., Ltd. Unit: Yuan
Item Sum of current period Sum of prior period
1. Cash flows from operating activities:
Cash received from sales of goods and rending of services 219,352,502 176,514,170
Tax refund received
Other cash received related to operating activities 4,587,865 14,486,373
Subtotal of cash flows of operating activities 223,940,367 191,000,543
Cash paid for goods and services 119,811,768 149,176,637
Cash paid to and on behalf of employees 31,143,555 25,497,870
Cash paid for taxes and expenses 22,678,777 2,648,464
Other cash paid related to operating activities 98,483,900 107,931,895
Sub-total of cash outflows of operating activities 272,118,000 285,254,866
Net cash flow from operating activities -48,177,633 -94,254,323
2. Cash flow from investing activities:
Cash received from disinvestment
Cash received from withdrawal of fixed deposits 5,200,000 15,200,000
Cash received from obtaining investment income 695,005,832 287,389,704
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Sum of current period Sum of prior period
Cash received from obtaining interest income 97,241
Net cash received from disposal of fixed assets, intangible assets and
47,954
other long-term assets
Net cash received from disposal of branch and other business unit
Other cash received related to investing activities
Subtotal of cash flows of investment activities 700,351,027 302,589,704
Cash paid to acquiring fixed assets, intangible assets and other
2,688,616 1,040,048
long-term assets
Cash for investment
Cash paid for purchasing fixed deposits 5,200,000 20,200,000
Net cash paid for acquiring branch and other business unit
Other cash paid related to investment activities 290,000,000 97,000,000
Subtotal of cash outflows of investment activities 297,888,616 118,240,048
Net cash flow from investing activities 402,462,411 184,349,656
3. Cash flow from financing activities
Cash received from acquiring investment
Cash received from acquiring loans 150,000,000 150,000,000
Other cash received related to financing activities
Subtotal cash flows of financing activities 150,000,000 150,000,000
Cash paid for debts 150,000,000 150,000,000
Cash paid to distribute dividend, profit or pay interest 2,442,943 2,748,375
Other cash paid related to financing activities 2,809,688
Subtotal of cash outflows of financing activities 155,252,631 152,748,375
Net cash flow from financing activities -5,252,631 -2,748,375
4. Influences of exchange rate fluctuation on cash and cash
equivalents
5. Net Increase in cash and cash equivalents 349,032,147 87,346,958
Plus: balance at the beginning of the period of cash and cash
182,123,070 623,116,542
equivalents
6. Balance at the end of the period of cash and cash equivalents 531,155,217 710,463,500
Legal Representative: Zhou Hongjiang Accounting Supervisor: Jiang Jianxun Accounting Department Manager: Guo Cuimei
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
2.7 Consolidated owner’s equity changing list
Unit: Yuan
This period
Owners’ equity of the parent company
Minority
Item Other equity instruments Minus: Other Total owners’
Capital Special Surplus General risk Undistributed shareholders’
Capital stock Preferred Perpetual
reserves
Treasury comprehensive
reserves reserves preparation profits
Other Subtotal equity
stock bonds
Other
stock income equity
1. Balance at the end of last year 685,464,000 524,968,760 576,129 342,732,000 8,714,091,755 10,267,832,644 236,597,990 10,504,430,634
Plus: Accounting policies changing -10,632,422 -10,632,422 -10,632,422
Previous error correction
Business combination under common
control
Other
2. Balance at the beginning of this year 685,464,000 524,968,760 576,129 342,732,000 8,703,459,333 10,257,200,222 236,597,990 10,493,798,212
3. Increased or decreased amount in this
period (reducing amount is listed with -21,618,495 97,636,219 76,017,724 4,374,174 80,391,898
“-")
3.1 Total comprehensive income -21,618,495 371,821,819 350,203,324 -2,664,599 347,538,725
3.2 Owners' invested and reduced
7,430,000 7,430,000
capital
3.2.1 Owner’ invested common stock 7,430,000 7,430,000
3.2.2 Other equity instrument holders’
invested capital
3.2.3 Amount of shares paid and
reckoned in owners' equity
3.2.4 Other
3.3 Profit distribution -274,185,600 -274,185,600 -391,227 -274,576,827
3.3.1 Accrued surplus reserves
3.3.2 Accrued general risk preparation
3.3.3 Distribution to owners (or
-274,185,600 -274,185,600 -391,227 -274,576,827
shareholders)
3.3.4 Other
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
This period
Owners’ equity of the parent company
Minority
Item Other equity instruments Minus: Other Total owners’
Capital Special Surplus General risk Undistributed shareholders’
Capital stock Preferred Perpetual Treasury comprehensive Other Subtotal equity
Other reserves reserves reserves preparation profits equity
stock bonds stock income
3.4 Internal transfer of owners' equity
3.4.1 Capital reserves transferred and
increased capital (or capital stock)
3.4.2 Surplus reserves transferred and
increased capital (or capital stock)
3.4.3 Surplus reserves covering deficit
3.4.4 Retained earnings carried over
from the benefit plan variation
3.4.5 Retained earnings carried over
from other comprehensive income
3.4.6 Other
3.5 Special reserves
3.5.1 Withdrawal in this period
3.5.2 Usage in this period
3.6 Other 0
4. Balance at the end of this period 685,464,000 524,968,760 -21,042,366 342,732,000 8,801,095,552 10,333,217,946 240,972,164 10,574,190,110
Unit: Yuan
Last period
Owners’ equity of the parent company
Minority
Item Other equity instruments Minus: Other Other Subtotal Total owners’
Capital Special Surplus General risk Undistributed shareholders’
Capital stock Preferred Perpetual
reserves
Treasury comprehensive
reserves reserves preparation profits
equity
stock bonds
Other
stock income equity
1. Balance at the end of last year 685,464,000 642,775,360 -4,235,583 342,732,000 8,735,513,044 10,402,248,821 271,876,064 10,674,124,885
Plus: Accounting policies changing
Previous error correction
Business combination under common
control
Other
2. Balance at the beginning of this year 685,464,000 642,775,360 -4,235,583 342,732,000 8,735,513,044 10,402,248,821 271,876,064 10,674,124,885
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Last period
Owners’ equity of the parent company
Minority
Item Other equity instruments Minus: Other Other Subtotal Total owners’
Capital Special Surplus General risk Undistributed shareholders’
Capital stock Preferred Perpetual
reserves
Treasury comprehensive
reserves reserves preparation profits
equity
stock bonds
Other
stock income equity
3. Increased or decreased amount in this
period (reducing amount is listed with -117,806,600 4,811,712 -21,421,289 -134,416,177 -35,278,074 -169,694,251
“-")
3.1 Total comprehensive income 4,811,712 470,860,587 475,672,299 2,561,399 478,233,698
3.2 Owners' invested and reduced
-117,806,600 -117,806,600 -34,679,936 -152,486,536
capital
3.2.1 Owner’ invested common stock
3.2.2 Other equity instrument holders’
invested capital
3.2.3 Amount of shares paid and
reckoned in owners' equity
3.2.4 Other -117,806,600 -117,806,600 -34,679,936 -152,486,536
3.3 Profit distribution -492,281,876 -492,281,876 -3,159,537 -495,441,413
3.3.1 Accrued surplus reserves
3.3.2 Accrued general risk preparation
3.3.3 Distribution to owners (or
-411,278,400 -411,278,400 -2,376,794 -413,655,194
shareholders)
3.3.4 Other
3.4 Internal transfer of owners' equity
3.4.1 Capital reserves transferred and
increased capital (or capital stock)
3.4.2 Surplus reserves transferred and
increased capital (or capital stock)
3.4.3 Surplus reserves covering deficit
3.4.4 Retained earnings carried over
from the benefit plan amount
3.4.5 Retained earnings carried over
from other comprehensive income
3.4.6 Other
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Last period
Owners’ equity of the parent company
Minority
Item Other equity instruments Minus: Other Other Subtotal Total owners’
Capital Special Surplus General risk Undistributed shareholders’
Capital stock Preferred Perpetual
reserves
Treasury comprehensive
reserves reserves preparation profits
equity
stock bonds
Other
stock income equity
3.5 Special reserves
3.5.1 Withdrawal in this period
3.5.2 Usage in this period
3.6 Other
4. Balance at the end of this period 685,464,000 524,968,760 576,129 342,732,000 8,714,091,755 10,267,832,644 236,597,990 10,504,430,634
2.8 Owner’s equity changing list of the parent company
Unit: Yuan
This period
Other equity instruments Minus: Other
Item Capital Special Surplus Undistributed Total owners’
Capital stock Preferred Perpetual Treasury comprehensive Other
Other reserves reserves reserves profits equity
stock bonds stock income
1. Balance at the end of last year 685,464,000 560,182,235 342,732,000 8,567,313,551 10,155,691,786
Plus: Accounting policies changing -6,289,720 -6,289,720
Previous error correction
Other
2. Balance at the beginning of this year 685,464,000 560,182,235 342,732,000 8,561,023,831 10,149,402,066
3. Increased or decreased amount in this
period (reducing amount is listed with 218,027,724 218,027,724
“-")
3.1 Total comprehensive income 492,213,324 492,213,324
3.2 Owners' invested and reduced capital
3.2.1 Owners’ invested common stock
3.2.2 Other equity instrument holder’
invested capital
3.2.3 Amount of shares paid and
reckoned in owners' equity
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
3.2.4 Other
3.3 Profit distribution -274,185,600 -274,185,600
3.3.1 Drew surplus reserves
3.3.2 Distribution to owners (or
-274,185,600 -274,185,600
shareholders)
3.3.3 Other
3.4 Internal transfer of owners' equity
3.4.1 Capital reserves transferred and
increased capital (or capital stock)
3.4.2 Surplus reserves transferred and
increased capital (or capital stock)
3.4.3 Surplus reserves covering deficit
3.4.4 Retained earnings carried over from
the benefit plan amount
3.4.5 Retained earnings carried over from
other comprehensive income
3.4.6 Other
3.5 Special reserves
3.5.1 Accrual in this period
3.5.2 Usage in this period
3.6 Other
4. Balance at the end of this period 685,464,000 560,182,235 342,732,000 8,779,051,555 10,367,429,790
Unit: Yuan
Last period
Item Other equity instruments Minus: Other
Capital Special Surplus Undistributed Total owners’
Capital stock Preferred Perpetual Treasury comprehensive Other
Other reserves reserves reserves profits equity
stock bonds stock income
1. Balance at the end of last year 685,464,000 557,222,454 342,732,000 8,619,977,577 10,205,396,031
Plus: Accounting policies changing
Previous error correction
Other
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
2. Balance at the beginning of this year 685,464,000 557,222,454 342,732,000 8,619,977,577 10,205,396,031
3. Increased or decreased amount in this
2,959,781 -52,664,026 -49,704,245
period (reducing amount is listed with “-")
3.1 Total comprehensive income 427,160,774 427,160,774
3.2 Owners' invested and reduced capital 2,959,781 2,959,781
3.2.1 Owners’ invested common stock
3.2.2 Other equity instrument holder’
invested capital
3.2.3 Amount of shares paid and reckoned
in owners' equity
3.2.4 Other 2,959,781 2,959,781
3.3 Profit distribution -479,824,800 -479,824,800
3.3.1 Drew surplus reserves
3.3.2 Distribution to owners (or
-479,824,800 -479,824,800
shareholders)
3.3.3 Other
3.4 Internal transfer of owners' equity
3.4.1 Capital reserves transferred and
increased capital (or capital stock)
3.4.2 Surplus reserves transferred and
increased capital (or capital stock)
3.4.3 Surplus reserves covering deficit
3.4.4 Retained earnings carried over from
the benefit plan amount
3.4.5 Retained earnings carried over from
other comprehensive income
3.4.6 Other
3.5 Special reserves
3.5.1 Accrual in this period
3.5.2 Usage in this period
3.6 Other
4. Balance at the end of this period 685,464,000 560,182,235 342,732,000 8,567,313,551 10,155,691,786
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
3. Company profile
Yantai Changyu Pioneer Wine Co., Ltd. (the “Company” or the “Joint-stock Company”) was
incorporated as a joint-stock limited company in accordance with the Company Law of the
People’s Republic of China (the “PRC”) in the merger and reorganization carried out by
Yantai Changyu Group Co., Ltd. (“Changyu Group”) with its assets and liabilities in relation
to wine business. The Company and its subsidiary companies (hereinafter collectively
referred to as the “Group”) are engaged in the production and sale of wine and brandy,
planting and purchase of grapes, development of tourism resources, etc. The registered
address of the Company is Yantai City, Shandong Province, and the office address of the
headquarters is 56 Dama Road, Zhifu District, Yantai City, Shandong Province.
As at June 30, 2021, the Company issued 685,464,000 shares accumulatively. Refer to Note
7.32 for details.
The parent company of the Group is Changyu Group incorporated in China, which was
ultimately and actually controlled by four parties, including Yantai Guofeng Investment
Holding Co., Ltd., ILLVA Saronno Holding Spa, International Finance Corporation and Yantai
Yuhua Investment & Development Co., Ltd.
The financial statement and the consolidated financial statement of the Company were
approved by the Board of Directors on August 24, 2021.
The details of scope of the consolidated financial statement in this period can be seen in Note
9 “Equity in other entities”. The details of scope changes of the consolidated financial
statement in this period can be seen in Note 8 “Changes of the consolidated scope”.
4. Preparation basis of financial statement
4.1 Preparation basis
The Group implements the Accounting Standards for Business Enterprises (including the new
and revised editions published in 2014) (“ASBE”) published by the Ministry of Finance and
relevant regulations thereof.
4.2 Continuous operation
The Group has appraised the ability of continuous operation for 12 months from June 30,
2021, and no issues or situations causing major doubts to this ability are found. Therefore, this
financial statement is prepared on the basis of the continuous operation assumption.
5. Main accounting policies and accounting estimates
5.1 Statement on compliance with ASBE
This financial statement fulfills the requirement of ASBE issued by the Ministry of Finance
and gives a true and integrated view of the consolidated financial status and the financial
status as at June 30, 2021, as well as the consolidated operating result, the operating result, the
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
consolidated cash flow and the cash flow of the Company from January to June 2021.
In addition, the financial statement of the Company also complies with the related disclosure
requirements for statement and its notes stipulated by Preparation Rules for Information
Disclosure by Companies Offering Securities to the Public No. 15 – General Provisions on
Financial Reports (2014 Revision) by the China Securities Regulatory Commission
(hereinafter referred to as the “CSRC”).
5.2 Accounting period
The accounting year is from January 1 to December 31 in Gregorian calendar.
5.3 Operating cycle
The operating cycle refers to the period from the enterprise purchases the assets used for
processing to the cash or cash equivalent is realized. The operating cycle of the Company is
12 months.
5.4 Recording currency
Since Renminbi (RMB) is the currency of the main economic environment in which the
Company and the domestic subsidiary companies thereof are situated, the Company and the
subsidiary companies thereof adopt RMB as the recording currency. The overseas subsidiary
companies thereof determine EUR, CLP and AUD as the recording currency according to the
main economic environment in which they are situated. The currency in this financial
statement prepared by the Group is RMB.
5.5 Accounting treatment method for business combination under common control and
non-common control
5.5.1 Business combination under common control
A business combination under common control is a business combination in which all of the
combining enterprises are ultimately controlled by the same party or same multiple parties
before and after the combination, and that control is not transitory. The assets and liabilities
obtained by the combining party in the business combination shall be measured on the basis
of the carrying amount in the ultimate controlling party's consolidated financial statement as
at the combination date. Where there is a difference between the carrying amount of the net
assets acquired and the carrying amount of the combination consideration paid (or the total
par value of the shares issued), the stock premium in capital surplus shall be adjusted. If the
stock premium in capital surplus is not sufficient to offset, the retained earnings shall be
adjusted. The direct related expenses incurred for the business combination shall be included
in the current profit and loss when incurred. The combination date is the date on which the
combining party actually obtains control of the combined party.
5.5.2 Business combination under non-common control
A business combination under non-common control is a business combination in which all of
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
the combining parties are not ultimately controlled by the same party or same multiple parties
before and after the combination. The sum of fair values of the assets paid by the Group, as
the acquirer, (including the acquiree’s equity the Group held before the acquisition date),
liabilities incurred or assumed, and the equity securities issued on the acquisition date in
exchange for the control over the acquiree, deducts the fair value of the acquiree’s identifiable
net assets acquired in the combination on the acquisition date. If the difference is positive, it
shall be recognized as goodwill; and if it is negative, it shall be included in the current profit
and loss. All the identifiable assets, liabilities and contingent liabilities which are obtained
from the acquiree and meet the recognition conditions shall be confirmed by the Group on the
acquisition date according to the fair value thereof. The acquisition date is the date on which
the acquirer actually obtains control of the acquiree.
For a business combination involving entities not under common control and achieved in
stages, the Group remeasures its previously-held equity interest in the acquiree to its
acquisition-date fair value and recognises any resulting difference between the fair value and
the carrying amount as investment income or other comprehensive income for the current
period. In addition, any amount recognised in other comprehensive income that may be
reclassified to profit or loss, in prior reporting periods relating to the previously-held equity
interest, and any other changes in the owners’ equity under equity accounting, are transferred
to investment income in the period in which the acquisition occurs. If equity interests of the
acquiree held before acquisition-date were equity instrument investments measured at fair
value through other comprehensive income, other comprehensive income recognised shall be
moved to retained earnings on acquisition-date.
5.6 Compiling methods of consolidated financial statement
5.6.1 General principles
The scope of consolidated financial statements is based on control and the consolidated
financial statements comprise the Company and its subsidiaries. Control exists when the
investor has all of following: power over the investee; exposure, or rights, to variable returns
from its involvement with the investee and has the ability to affect those returns through its
power over the investee. When assessing whether the Group has power, only substantive
rights (held by the Group and other parties) are considered. The financial position, financial
performance and cash flows of subsidiaries are included in the consolidated financial
statements from the date that control commences until the date that control ceases.
Non-controlling interests are presented separately in the consolidated balance sheet within
shareholders’ equity. Net profit or loss attributable to non-controlling shareholders is
presented separately in the consolidated income statement below the net profit line item. Total
comprehensive income attributable to non-controlling shareholders is presented separately in
the consolidated income statement below the total comprehensive income line item.
When the amount of loss for the current period attributable to the non-controlling
shareholders of a subsidiary exceeds the non-controlling shareholders’ share of the opening
owners’ equity of the subsidiary, the excess is still allocated against the non-controlling
interests.
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When the accounting period or accounting policies of a subsidiary are different from those of
the Company, the Company makes necessary adjustments to the financial statements of the
subsidiary based on the Company’s own accounting period or accounting policies. Intra-group
balances and transactions, and any unrealised profit or loss arising from intra-group
transactions, are eliminated when preparing the consolidated financial statements. Unrealised
losses resulting from intra-group transactions are eliminated in the same way as unrealised
gains, unless they represent impairment losses that are recognised in the financial statements.
5.6.2 Subsidiaries acquired through a business combination
Where a subsidiary was acquired during the reporting period, through a business combination
involving entities under common control, the financial statements of the subsidiary are
included in the consolidated financial statements based on the carrying amounts of the assets
and liabilities of the subsidiary in the financial statements of the ultimate controlling party as
if the combination had occurred at the date that the ultimate controlling party first obtained
control. The opening balances and the comparative figures of the consolidated financial
statements are also restated.
Where a subsidiary was acquired during the reporting period, through a business combination
involving entities not under common control, the identifiable assets and liabilities of the
acquired subsidiaries are included in the scope of consolidation from the date that control
commences, based on the fair value of those identifiable assets and liabilities at the
acquisition date.
5.6.3 Disposal of subsidiaries
When the Group loses control over a subsidiary, any resulting disposal gains or losses are
recognised as investment income for the current period. The remaining equity investment is
re-measured at its fair value at the date when control is lost, any resulting gains or losses are
also recognised as investment income for the current period.
When the Group loses control of a subsidiary in multiple transactions in which it disposes of
its long-term equity investment in the subsidiary in stages, the following are considered to
determine whether the Group should account for the multiple transactions as a bundled
transaction:
- arrangements are entered into at the same time or in contemplation of each other;
- arrangements work together to achieve an overall commercial effect;
- the occurrence of one arrangement is dependent on the occurrence of at least one other
arrangement;
- one arrangement considered on its own is not economically justified, but it is
economically justified when considered together with other arrangements.
If each of the multiple transactions does not form part of a bundled transaction, the
transactions conducted before the loss of control of the subsidiary are accounted for in
accordance with the accounting policy for partial disposal of equity investment in subsidiaries
where control is retained.
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If each of the multiple transactions forms part of a bundled transaction which eventually
results in the loss of control in the subsidiary, these multiple transactions are accounted for as
a single transaction. In the consolidated financial statements, the difference between the
consideration received and the corresponding proportion of the subsidiary’s net assets
(calculated continuously from the acquisition date) in each transaction prior to the loss of
control shall be recognised in other comprehensive income and transferred to profit or loss
when the parent eventually loses control of the subsidiary.
5.6.4 Changes in non-controlling interests
Where the Company acquires a non-controlling interest from a subsidiary’s non-controlling
shareholders or disposes of a portion of an interest in a subsidiary without a change in control,
the difference between the proportion interests of the subsidiary’s net assets being acquired or
disposed and the amount of the consideration paid or received is adjusted to the capital
reserve (share premium) in the consolidated balance sheet, with any excess adjusted to
retained earnings.
5.7 Determination standard of cash and cash equivalents
Cash and cash equivalents comprise cash on hand, demand deposit, and short-term highly
liquid investments which are readily convertible into known amount of cash with an
insignificant risk of changes in value.
5.8 Foreign currency transaction and foreign currency statement translation
When the Group receives capital in foreign currencies from investors, the capital is translated
to Renminbi at the spot exchange rate at the date of the receipt. Other foreign currency
transactions are, on initial recognition, translated to Renminbi at the spot exchange rates.
Monetary items denominated in foreign currencies are translated to Renminbi at the spot
exchange rate at the balance sheet date. The resulting exchange differences are generally
recognised in profit or loss, unless they arise from the re-translation of the principal and
interest of specific borrowings for the acquisition and construction of qualifying assets.
Non-monetary items that are measured at historical cost in foreign currencies are translated to
Renminbi using the exchange rate at the transaction date.
In translating the financial statements of a foreign operation, assets and liabilities of foreign
operation are translated to Renminbi at the spot exchange rate at the balance sheet date.
Equity items, excluding retained earnings and the translation differences in other
comprehensive income, are translated to Renminbi at the spot exchange rates at the
transaction dates. Income and expenses in the income statement are translated to Renminbi at
the spot exchange rates at the transaction dates. The resulting translation differences are
recognised in other comprehensive income. The translation differences accumulated in other
comprehensive income with respect to a foreign operation are transferred to profit or loss in
the period when the foreign operation is disposed.
5.9 Financial instruments
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Financial instruments include cash at bank and on hand, investments in debt and equity
securities other than those classified as long-term equity investments, receivables, payables,
loans and borrowings and share capital.
5.9.1 Recognition and initial measurement of financial assets and financial liabilities
A financial asset and financial liability is recognised in the balance sheet when the Group
becomes a party to the contractual provisions of a financial instrument.
A financial assets (unless it is a trade receivable without a significant financing component)
and financial liabilities is measured initially at fair value. For financial assets and financial
liabilities at fair value through profit or loss, any related directly attributable transaction costs
are charged to profit or loss; for other categories of financial assets and financial liabilities,
any related directly attributable transaction costs are included in their initial costs. Accounts
receivable containing no significant financing component are measured initially at transaction
prices determined by the accounting policies set out in Note 5.23.
5.9.2 Classification and subsequent measurement of financial assets
(a) Classification of financial assets
The classification of financial assets is generally based on the business model in which a
financial asset is managed and its contractual cash flow characteristics. On initial recognition,
a financial asset is classified as measured at amortised cost, at fair value through other
comprehensive income (“FVOCI”), or at fair value through profit or loss (“FVTPL”).
Financial assets are not reclassified subsequent to their initial recognition unless the Group
changes its business model for managing financial assets in which case all affected financial
assets are reclassified on the first day of the first reporting period following the change in the
business model.
A financial asset is measured at amortised cost if it meets both of the following conditions and
is not designated as at FVTPL:
- it is held within a business model whose objective is to hold assets to collect contractual
cash flows; and
- its contractual terms give rise on specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding.
A debt investment is measured at FVOCI if it meets both of the following conditions and is
not designated as at FVTPL:
- it is held within a business model whose objective is achieved by both collecting
contractual cash flows and selling financial assets; and
- its contractual terms give rise on specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding.
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On initial recognition of an equity investment that is not held for trading, the Group may
irrevocably elect to present subsequent changes in the investment’s fair value in other
comprehensive income. This election is made on an investment-by-investment basis. The
instrument meets the definition of equity from the perspective of the issuer.
All financial assets not classified as measured at amortised cost or FVOCI as described above
are measured at FVTPL. On initial recognition, the Group may irrevocably designate a
financial asset that otherwise meets the requirements to be measured at amortised cost or at
FVOCI as at FVTPL if doing so eliminates or significantly reduces an accounting mismatch
that would otherwise arise.
The business model refers to how the Group manages its financial assets in order to generate
cash flows. That is, the Group’s business model determines whether cash flows will result
from collecting contractual cash flows, selling financial assets or both. The Group determines
the business model for managing the financial assets according to the facts and based on the
specific business objective for managing the financial assets determined by the Group’s key
management personnel.
In assessing whether the contractual cash flows are solely payments of principal and interest,
the Group considers the contractual terms of the instrument. For the purposes of this
assessment, ‘principal’ is defined as the fair value of the financial asset on initial recognition.
‘Interest’ is defined as consideration for the time value of money and for the credit risk
associated with the principal amount outstanding during a particular period of time and for
other basic lending risks and costs, as well as a profit margin. The Group also assesses
whether the financial asset contains a contractual term that could change the timing or amount
of contractual cash flows such that it would not meet this condition.
(b) Subsequent measurement of financial assets
- Financial assets at FVTPL
These financial assets are subsequently measured at fair value. Net gains and losses, including
any interest or dividend income, are recognised in profit or loss unless the financial assets are
part of a hedging relationship.
- Financial assets at amortised cost
These assets are subsequently measured at amortised cost using the effective interest method.
A gain or loss on a financial asset that is measured at amortised cost and is not part of a
hedging relationship shall be recognised in profit or loss when the financial asset is
derecognised, through the amortisation process or in order to recognise impairment gains or
losses.
- Debt investments at FVOCI
These assets are subsequently measured at fair value. Interest income calculated using the
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
effective interest method, impairment and foreign exchange gains and losses are recognised in
profit or loss. Other net gains and losses are recognised in other comprehensive income. On
derecognition, gains and losses accumulated in other comprehensive income are reclassified
to profit or loss.
- Equity investments at FVOCI
These assets are subsequently measured at fair value. Dividends are recognised as income in
profit or loss. Other net gains and losses are recognised in other comprehensive income. On
derecognition, gains and losses accumulated in other comprehensive income are reclassified
to retained earnings.
5.9.3 Classification and subsequent measurement of financial liabilities
Financial liabilities are classified as measured at FVTPL or amortised cost by the Group.
- Financial liabilities at FVTPL
A financial liability is classified as at FVTPL if it is classified as held-for-trading (including
derivative financial liability) or it is designated as such on initial recognition.
Financial liabilities at FVTPL are subsequently measured at fair value and net gains and
losses, including any interest expense, are recognised in profit or loss, unless the financial
liabilities are part of a hedging relationship.
- Financial liabilities at amortised cost
These financial liabilities are subsequently measured at amortised cost using the effective
interest method.
5.9.4 Offsetting
Financial assets and financial liabilities are generally presented separately in the balance sheet,
and are not offset. However, a financial asset and a financial liability are offset and the net
amount is presented in the balance sheet when both of the following conditions are satisfied:
- The Group currently has a legally enforceable right to set off the recognised amounts；
- The Group intends either to settle on a net basis, or to realise the financial asset and settle
the financial liability simultaneously.
5.9.5 Derecognition of financial assets and financial liabilities
Financial asset is derecognised when one of the following conditions is met:
- the Group’s contractual rights to the cash flows from the financial asset expire;
- the financial asset has been transferred and the Group transfers substantially all of the
risks and rewards of ownership of the financial asset; or；
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
- the financial asset has been transferred, although the Group neither transfers nor retains
substantially all of the risks and rewards of ownership of the financial asset, it does not retain
control over the transferred asset.
Where a transfer of a financial asset in its entirety meets the criteria for derecognition, the
difference between the two amounts below is recognised in profit or loss:
- the carrying amount of the financial asset transferred measured at the date of
derecognition;
- the sum of the consideration received from the transfer and, when the transferred
financial asset is a debt investment at FVOCI, any cumulative gain or loss that has been
recognised directly in other comprehensive income for the part derecognised.
The Group derecognises a financial liability (or part of it) only when its contractual obligation (or part
of it) is extinguished.
5.9.6 Impairment
The Group recognises loss allowances for expected credit loss (ECL) on:
- financial assets measured at amortised cost;
- financial investments at fair value through other comprehensive income
Financial assets measured at fair value, including debt investments or equity securities at
FVPL, equity securities designated at FVOCI and derivative financial assets, are not subject
to the ECL assessment.
Measurement of ECLs
ECLs are a probability-weighted estimate of credit losses. Credit losses are measured as the
present value of all cash shortfalls (i.e. the difference between the cash flows due to the entity
in accordance with the contract and the cash flows that the Group expects to receive).
The maximum period considered when estimating ECLs is the maximum contractual period
(including extension options) over which the Group is exposed to credit risk.
Lifetime ECLs are the ECLs that result from all possible default events over the expected life
of a financial instrument.
12-month ECLs are the portion of ECLs that result from default events that are possible
within the 12 months after the balance sheet date (or a shorter period if the expected life of the
instrument is less than 12 months).
For accounts receivable, loss allowance always measured at an amount equal to lifetime ECLs.
ECLs on these financial assets are estimated using a provision matrix based on the Group’s
historical credit loss experience, adjusted for factors that are specific to the debtors and an
assessment of both the current and forecast general economic conditions at the balance sheet
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
date.
For assets other than accounts receivable that meet one of the following conditions, loss
allowance are measured at an amount equal to 12-month ECLs. For all other financial
instruments, the Group recognises a loss allowance equal to lifetime ECLs:
- If the financial instrument is determined to have low credit risk at the balance sheet date;
- If the credit risk on a financial instrument has not increased significantly since initial
recognition.
Financial instruments that have low credit risk
The credit risk on a financial instrument is considered low if the financial instrument has a
low risk of default, the borrower has a strong capacity to meet its contractual cash flow
obligations in the near term and adverse changes in economic and business conditions in the
longer term may, but will not necessarily, reduce the ability of the borrower to fulfil its
contractual cash flow obligations.
Significant increases in credit risk
In assessing whether the credit risk of a financial instrument has increased significantly since
initial recognition, the Group compares the risk of default occurring on the financial
instrument assessed at the balance sheet date with that assessed at the date of initial
recognition.
When determining whether the credit risk of a financial asset has increased significantly since
initial recognition and when estimating ECL, the Group considers reasonable and supportable
information that is relevant and available without undue cost or effort, including
forward-looking information. In particular, the following information is taken into account:
- failure to make payments of principal or interest on their contractually due dates;
- an actual or expected significant deterioration in a financial instrument’s external or
internal credit rating (if available);
- an actual or expected significant deterioration in the operating results of the debtor; and
- existing or forecast changes in the technological, market, economic or legal environment
that have a significant adverse effect on the debtor’s ability to meet its obligation to the
Group.
Depending on the nature of the financial instruments, the assessment of a significant increase
in credit risk is performed on either an individual basis or a collective basis. When the
assessment is performed on a collective basis, the financial instruments are grouped based on
shared credit risk characteristics, such as past due status and credit risk ratings.
The Group assumes that the credit risk on a financial asset has increased significantly if it is
more than 30 days past due.
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Credit-impaired financial assets
At each balance sheet date, the Group assesses whether financial assets carried at amortised
cost and debt investments at FVOCI are credit-impaired. A financial asset is ‘credit-impaired’
when one or more events that have a detrimental impact on the estimated future cash flows of
the financial asset have occurred. Evidence that a financial asset is credit-impaired includes
the following observable data:
- significant financial difficulty of the borrower or issuer;
- a breach of contract, such as a default or delinquency in interest or principal payments;
- for economic or contractual reasons relating to the borrower’s financial difficulty, the
Group having granted to the borrower a concession that would not otherwise consider;
- it is probable that the borrower will enter bankruptcy or other financial reorganisation; or
- the disappearance of an active market for that financial asset because of financial
difficulties.
Presentation of allowance for ECL
ECLs are remeasured at each balance sheet date to reflect changes in the financial
instrument’s credit risk since initial recognition. Any change in the ECL amount is recognised
as an impairment gain or loss in profit or loss. The Group recognises an impairment gain or
loss for all financial instruments with a corresponding adjustment to their carrying amount
through a loss allowance account, except for debt investments that are measured at FVOCI,
for which the loss allowance is recognised in other comprehensive income.
Write-off
The gross carrying amount of a financial asset is written off (either partially or in full) to the
extent that there is no realistic prospect of recovery. A write-off constitutes a derecognition
event. This is generally the case when the Group determines that the debtor does not have
assets or sources of income that could generate sufficient cash flows to repay the amounts
subject to the write-off. However, financial assets that are written off could still be subject to
enforcement activities in order to comply with the Group’s procedures for recovery of
amounts due.
Subsequent recoveries of an asset that was previously written off are recognised as a reversal
of impairment in profit or loss in the period in which the recovery occurs.
5.9.7 Equity instrument
The consideration received from the issuance of equity instruments net of transaction costs is
recognised in shareholders’ equity. Consideration and transaction costs paid by the Company
for repurchasing self-issued equity instruments are deducted from shareholders’ equity.
When the Company repurchases its own shares, those shares are treated as treasury shares. All
expenditure relating to the repurchase is recorded in the cost of the treasury shares, with the
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transaction recording in the share register. Treasury shares are excluded from profit
distributions and are presented as a deduction under shareholders’ equity in the balance sheet.
5.10 Inventories
5.10.1 Classification and cost
Inventories include raw materials, work in progress and reusable materials. Inventories are
initially measured at cost. Cost of inventories comprises all costs of purchase, costs of
conversion and other expenditure incurred in bringing the inventories to their present location
and condition. In addition to the purchase cost of raw materials, work in progress and finished
goods include direct labour costs and an appropriate allocation of production overheads.
Agricultural products harvested are reported in accordance with the CAS No.1 - Inventories.
5.10.2 Measurement method of cost of inventories
Cost of inventories is calculated using the weighted average method.
Consumables including low-value consumables and packaging materials are amortised when
they are used. The amortisation charge is included in the cost of the related assets or
recognised in profit or loss for the current period.
5.10.3 Basis for determining the net realisable value and method for provision for
obsolete inventories
At the balance sheet date, inventories are carried at the lower of cost and net realisable value.
Net realisable value is the estimated selling price in the ordinary course of business less the
estimated costs of completion and the estimated costs necessary to make the sale and relevant
taxes. The net realisable value of materials held for use in the production is measured based
on the net realisable value of the finished goods in which they will be incorporated. The net
realisable value of the inventory held to satisfy sales or service contracts is measured based on
the contract price, to the extent of the quantities specified in sales contracts, and the excess
portion of inventories is measured based on general selling prices.
Any excess of the cost over the net realisable value of each item of inventories is recognised
as a provision for impairment, and is recognised in profit or loss.
5.10.4 Inventory count system
The Group maintains a perpetual inventory system.
5.11 Long-term equity investments
5.11.1 Investment cost of long-term equity investments
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(a) Long-term equity investments acquired through a business combination
- The initial cost of a long-term equity investment acquired through a business combination
involving entities under common control is the Company’s share of the carrying amount of
the subsidiary’s equity in the consolidated financial statements of the ultimate controlling
party at the combination date. The difference between the initial investment cost and the
carrying amount of the consideration given is adjusted to the share premium in the capital
reserve, with any excess adjusted to retained earnings. For a long-term equity investment in a
subsidiary acquired through a business combination achieved in stages which do not form a
bundled transaction and involving entities under common control, the Company determines
the initial cost of the investment in accordance with the above policies. The difference
between this initial cost and the sum of the carrying amount of previously-held investment
and the consideration paid for the shares newly acquired is adjusted to capital premium in the
capital reserve, with any excess adjusted to retained earnings.
- For a long-term equity investment obtained through a business combination not involving
enterprises under common control, the initial cost comprises the aggregate of the fair value of
assets transferred, liabilities incurred or assumed, and equity securities issued by the Company,
in exchange for control of the acquiree. For a long-term equity investment obtained through a
business combination not involving entities under common control and achieved through
multiple transactions in stages which do not form a bundled transaction, the initial cost
comprises the carrying amount of the previously-held equity investment in the acquiree
immediately before the acquisition date, and the additional investment cost at the acquisition
date.
(b) Long-term equity investments acquired other than through a business combination
- A long-term equity investment acquired other than through a business combination is
initially recognised at the amount of cash paid if the Group acquires the investment by cash,
or at the fair value of the equity securities issued if an investment is acquired by issuing
equity securities.
5.11.2 Subsequent measurement of long-term equity investment
(a) Investments in subsidiaries
In the Company’s separate financial statements, long-term equity investments in subsidiaries
are accounted for using the cost method unless the investment is classified as held for sale.
Except for cash dividends or profit distributions declared but not yet distributed that have
been included in the price or consideration paid in obtaining the investments, the Company
recognises its share of the cash dividends or profit distributions declared by the investee as
investment income for the current period.
The investments in subsidiaries are stated in the balance sheet at cost less accumulated
impairment losses.
For the impairment of the investments in subsidiaries, refer to Note 5.21.
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In the Group’s consolidated financial statements, subsidiaries are accounted for in accordance
with the policies described in Note 5.6.
(b) Investments in joint ventures and associates
A joint venture is an arrangement whereby the Group and other parties have joint control and
rights to the net assets of the arrangement.
An associate is an enterprise the Group can exert significant influence on.
A long-term equity investment in a joint venture and associate is accounted for using the
equity method for subsequent measurement, unless the investment is classified as held for
sale.
The accounting treatments under the equity method adopted by the Group are as follows:
- Where the initial cost of a long-term equity investment exceeds the Group’s interest in the
fair value of the investee’s identifiable net assets at the date of acquisition, the investment is
initially recognised at cost. Where the initial investment cost is less than the Group’s interest
in the fair value of the investee’s identifiable net assets at the date of acquisition, the
investment is initially recognised at the investor’s share of the fair value of the investee’s
identifiable net assets, and the difference is recognised in profit or loss.
- After the acquisition of the investment in joint ventures and associates, the Group
recognises its share of the investee’s profit or loss and other comprehensive income as
investment income or losses and other comprehensive income respectively, and adjusts the
carrying amount of the investment accordingly. Once the investee declares any cash dividends
or profit distributions, the carrying amount of the investment is reduced by the amount
attributable to the Group. Changes in the Group’s share of the investee’s owners’ equity, other
than those arising from the investee’s net profit or loss, other comprehensive income or profit
distribution (referred to as “other changes in owners’ equity”), is recognised directly in the
Group’s equity, and the carrying amount of the investment is adjusted accordingly.
- In calculating its share of the investee’s net profits or losses, other comprehensive income
and other changes in owners’ equity, the Group recognises investment income and other
comprehensive income after making appropriate adjustments to align the accounting policies
or accounting periods with those of the Group based on the fair value of the investee’s
identifiable net assets at the date of acquisition. Unrealised profits and losses resulting from
transactions between the Group and its associates or joint ventures are eliminated to the extent
of the Group’s interest in the associates or joint ventures. Unrealised losses resulting from
transactions between the Group and its associates or joint ventures are eliminated in the same
way as unrealised gains but only to the extent that there is no impairment.
- The Group discontinues recognising its share of further losses of the investee after the
carrying amount of the long-term equity investment and any long-term interest that in
substance forms part of the Group’s net investment in the associate is reduced to zero, except
to the extent that the Group has an obligation to assume additional losses. If the joint venture
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or the associate subsequently reports net profits, the Group resumes recognising its share of
those profits only after its share of the profits equals the share of losses not recognised.
For the impairment of the investments in joint ventures and associates, refer to Note 5.21.
5.11.3 Criteria for determining the existence of joint control and significant impact over
an investee
Joint control is the contractually agreed sharing of control of an arrangement, which exists
only when decisions about the relevant activities (activities with significant impact on the
returns of the arrangement) require the unanimous consent of the parties sharing control.
The following factors are usually considered when assessing whether the Group can exercise
joint control over an investee:
- Whether no single participant party is in a position to control the investee’s related
activities unilaterally;
- Whether strategic decisions relating to the investee’s related activities require the
unanimous consent of all participant parties that sharing of control.
Significant influence is the power to participate in the financial and operating policy decisions
of an investee but does not have control or joint control over those policies.
5.12 Investment properties
Investment properties are properties held either to earn rental income or for capital
appreciation or for both. Investment properties are accounted for using the cost model and
stated in the balance sheet at cost less accumulated depreciation, amortisation and impairment
losses, and adopts a depreciation or amortisation policy for the investment property which is
consistent with that for buildings or land use rights, unless the investment property is
classified as held for sale. For the impairment of the investment properties, refer to Note 5.21.
Estimated useful life Residual value rate Depreciation rate
Category
(years) (%) (%)
Plant and buildings 20-40 years 0 - 5% 2.4%-5.0%
5.13 Fixed assets
5.13.1 Recognition of fixed assets
Fixed assets represent the tangible assets held by the Group for use in production of goods,
supply of services, for rental or for administrative purposes with useful lives over one
accounting year.
The cost of a purchased fixed asset comprises the purchase price, related taxes, and any
directly attributable expenditure for bringing the asset to working condition for its intended
use. The cost of self-constructed assets is measured in accordance with the policy set out in
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Note 5.14.
Where the parts of an item of fixed assets have different useful lives or provide benefits to the
Group in a different pattern, thus necessitating use of different depreciation rates or methods,
each part is recognised as a separate fixed asset.
Any subsequent costs including the cost of replacing part of an item of fixed assets are
recognised as assets when it is probable that the economic benefits associated with the costs
will flow to the Group, and the carrying amount of the replaced part is derecognised. The
costs of the day-to-day maintenance of fixed assets are recognised in profit or loss as incurred.
Fixed assets are stated in the balance sheet at cost less accumulated depreciation and
impairment losses.
5.13.2 Depreciation of fixed assets
The cost of a fixed asset, less its estimated residual value and accumulated impairment losses,
is depreciated using the straight-line method over its estimated useful life, unless the fixed
asset is classified as held for sale.
The estimated useful lives, residual value rates and depreciation rates of each class of fixed
assets are as follows:
Estimated useful Residual value rate Depreciation rate
Class
life (years) (%) (%)
Plant and buildings 20-40 years 0 - 5% 2.4%-5.0%
Machinery equipment 5-30 years 0 - 5% 3.2%-20.0%
Motor vehicles 4-12 years 0 - 5% 7.9%-25.0%
Useful lives, estimated residual values and depreciation methods are reviewed at least at each
year-end.
5.13.3 For the impairment of the fixed assets, refer to Note 5.20.
5.13.4 Disposal of fixed assets
The carrying amount of a fixed asset is derecognised:
- when the fixed asset is holding for disposal; or
- when no future economic benefit is expected to be generated from its use or disposal.
Gains or losses arising from the retirement or disposal of an item of fixed asset are determined
as the difference between the net disposal proceeds and the carrying amount of the item, and
are recognised in profit or loss on the date of retirement or disposal.
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5.14 Construction in progress
The cost of self-constructed assets includes the cost of materials, direct labour, capitalised
borrowing costs, and any other costs directly attributable to bringing the asset to working
condition for its intended use.
A self-constructed asset is classified as construction in progress and transferred to fixed asset
when it is ready for its intended use. No depreciation is provided against construction in
progress.
Construction in progress is stated in the balance sheet at cost less accumulated impairment
losses (see Note 5.21).
5.15 Borrowing costs
Borrowing costs incurred directly attributable to the acquisition, and construction or
production of a qualifying asset are capitalised as part of the cost of the asset. Other
borrowing costs are recognised as financial expenses when incurred.
During the capitalisation period, the amount of interest (including amortisation of any
discount or premium on borrowing) to be capitalised in each accounting period is determined
as follows:
- Where funds are borrowed specifically for the acquisition and construction or production
of a qualifying asset, the amount of interest to be capitalised is the interest expense calculated
using effective interest rates during the period less any interest income earned from depositing
the borrowed funds or any investment income on the temporary investment of those funds
before being used on the asset.
- To the extent that the Group borrows funds generally and uses them for the acquisition
and construction or production of a qualifying asset, the amount of borrowing costs eligible
for capitalisation is determined by applying a capitalisation rate to the weighted average of the
excess amounts of cumulative expenditure on the asset over the above amounts of specific
borrowings. The capitalisation rate is the weighted average of the interest rates applicable to
the general-purpose borrowings.
The effective interest rate is determined as the rate that exactly discounts estimated future
cash flow through the expected life of the borrowing or, when appropriate, a shorter period to
the initially recognised amount of the borrowings.
During the capitalisation period, exchange differences related to the principal and interest on a
specific-purpose borrowing denominated in foreign currency are capitalised as part of the cost
of the qualifying asset. The exchange differences related to the principal and interest on
foreign currency borrowings other than a specific-purpose borrowing are recognised as a
financial expense when incurred.
The capitalisation period is the period from the date of commencement of capitalisation of
borrowing costs to the date of cessation of capitalisation, excluding any period over which
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capitalisation is suspended. Capitalisation of borrowing costs commences when expenditure
for the asset is being incurred, borrowing costs are being incurred and activities of acquisition,
construction or production that are necessary to prepare the asset for its intended use are in
progress, and ceases when the assets become ready for their intended use. Capitalisation of
borrowing costs should cease when the qualifying asset being constructed or produced has
reached its expected usable or saleable condition. Capitalisation of borrowing costs is
suspended when the acquisition, construction or production activities are interrupted
abnormally for a period of more than three months.
5.16 Biological assets
The biological assets of the Group are productive biological assets.
Bearer biological assets are those that are held for the purposes of producing agricultural
produce, rendering of services or rental. Bearer biological assets in the Group are vines.
Bearer biological assets are initially measured at cost. The cost of self-grown or self-bred
bearer biological assets represents the necessary directly attributable expenditure incurred
before satisfying the expected production and operating purpose, including capitalised
borrowing costs.
Bearer biological assets, after reaching the expected production and operating purpose, are
depreciated using the straight-line method over its estimated useful life. The estimated useful
lives, estimated net residual value rates and depreciation rates of bearer biological assets are
as follows:
Estimated net residual Annual depreciation rate
Category Useful life (years)
rate (%) (%)
Vines 20 years 0% 5.0%
The Group evaluates the useful life and expected net salvage value by considering the normal
producing life of the bearer biological assets.
Useful lives, estimated residual values and depreciation methods of bearer biological assets
are reviewed at least at each year-end. Any changes should be treated as changes in
accounting estimates.
For a bearer biological asset that has been sold, damaged, dead or destroyed, any difference
between the disposal proceeds and the carrying amount of the asset (after tax deduction)
should be recognised in profit or loss for the period in which it arises.
5.17 Right-to-use assets
Right-to-use assets refer to the right vested in the Group as the lessee to use any leased assets
during the lease period. Upon the commencement the lease term, the Group recognizes
right-to-use assets and lease liabilities for leases as the lessee, provided that short-term leases
and leases of low-value assets subject to simplified treatment are excluded.
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The right-to-use assets of the Group are initially measured at cost. The said cost includes:
– Initially measured amount of leased liability;
– Amount of lease payments made on or before the commencement date of the lease term;
in case of any lease incentive, the related amount of such lease incentive having been enjoyed
shall be deducted;
– Initial direct costs incurred by the Group as the lessee;
– Costs that the Group expects to incur to disassemble and remove leased assets, restore the
site where leased assets are located or restore leased assets to the agreed condition under the
terms of the lease.
The Group employs the straight-line method to depreciate right-to-use assets. Where it can be
reasonably recognized that the ownership of leased assets will be obtained by the Group upon
expiration of the lease term, leased assets will be depreciated during the service life; where it
cannot be reasonably recognized, leased assets will be depreciated during the lease term or the
remaining service life of such leased assets by the Group, whichever is shorter.
The Group determines whether any right-to-use assets are impaired in accordance with the
provisions of Accounting Standard for Business Enterprises No. 8 - Impairment of Assets (the
“Standard"), and has identified impairment losses subject to accounting treatment.
When the Group remeasures lease liabilities according to the Standard, the book value of
right-to-use assets shall be adjusted accordingly. Where the book value of right-to-use assets
has been reduced to zero, but lease liabilities still need to be subject to further reduction, the
remaining amount shall be recognized in current profits and losses. Where any lease change
results in decreased lease scope or shortened lease term, the Group shall correspondingly
reduce the book value of right-to-use assets and recognize gains or losses related to the
partially or completely terminated lease in current profits and losses. Where any other lease
change results in remeasurement of lease liabilities, the Group shall correspondingly adjust
the book value of right-to-use assets.
5.18 Intangible assets
Intangible assets are stated in the balance sheet at cost less accumulated amortization (where
the estimated useful life is finite) and impairment losses (see Note 5.21). For an intangible
asset with finite useful life, its cost estimated less residual value and accumulated impairment
losses is amortised on the straight-line method over its estimated useful life, unless the
intangible asset is classified as held for sale.
The respective amortisation periods for intangible assets are as follows:
Item Amortisation period (years)
Land use rights 40-50 years
Software licenses 5-10 years
Trademark 10 years
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An intangible asset is regarded as having an indefinite useful life and is not amortised when
there is no foreseeable limit to the period over which the asset is expected to generate
economic benefits for the Group. At the balance sheet date, the Group had intangible assets
with infinite useful lives including the land use rights and trademarks. Land use rights with
infinite useful lives are permanent land use rights with permanent ownership held by the
Group under the relevant Chile and Australian laws arising from the Group’s acquisition of
Via Indómita, S.A., Via Dos Andes, S.A., and Bodegas Santa Alicia SpA. (collectively
referred to as the “Chile Indomita Wine Group”), and the acquisition of Kilikanoon Estate Pty
Ltd.( hereinafter referred to as the “Australia Kilikanoon Estate”), therefore there was no
amortisation. The right to use trademark refers to the trademark held by the Group arising
from the acquisition of the Chile Indomita Wine Group and the Australia Kilikanoon Estate
with infinite useful lives. The valuation of trademark was based on the trends in the market
and competitive environment, product cycle, and managing long-term development strategy.
Those bases indicated the trademark will provide net cash flows to the Group within an
uncertain period. The useful life is indefinite as it was hard to predict the period that the
trademark would bring economic benefits to the Group.
5.19 Goodwill
The initial cost of goodwill represents the excess of cost of acquisition over the acquirer’s
interest in the fair value of the identifiable net assets of the acquiree under a business
combination not involving entities under common control.
Goodwill is not amortised and is stated in the balance sheet at cost less accumulated
impairment losses (see Note 5.21). On disposal of an asset group or a set of asset groups, any
attributable goodwill is written off and included in the calculation of the profit or loss on
disposal.
5.20 Long-term deferred expenses
Long-term deferred expenses are amortised using a straight-line method within the benefit
period. The respective amortisation periods for such expenses are as follows:
Item Amortisation period
Land requisition fee 50 years
Land lease fee 50 years
Greening fee 5-20 years
Renovation fee 3-5 years
Others 3 years
5.21 Impairment of assets other than inventories and financial assets
The carrying amounts of the following assets are reviewed at each balance sheet date based on
internal and external sources of information to determine whether there is any indication of
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impairment:
- fixed assets
- construction in progress
- intangible assets
- Bearer biological assets
- investment properties measured using a cost model
- long-term equity investments
- goodwill
- long-term deferred expenses, etc.
- right-to-use assets
If any indication exists, the recoverable amount of the asset is estimated. In addition, the
Group estimates the recoverable amounts of goodwill and intangible assets with infinite
useful lives at each year-end, irrespective of whether there is any indication of impairment.
Goodwill is allocated to each asset group, or set of asset groups, that is expected to benefit
from the synergies of the combination for the purpose of impairment testing.
The recoverable amount of an asset (or asset group, set of asset groups) is the higher of its fair
value (see Note 5.22) less costs to sell and its present value of expected future cash flows.
An asset group is composed of assets directly related to cash-generation and is the smallest
identifiable group of assets that generates cash inflows that are largely independent of the
cash inflows from other assets or asset groups.
The present value of expected future cash flows of an asset is determined by discounting the
future cash flows, estimated to be derived from continuing use of the asset and from its
ultimate disposal, to their present value using an appropriate pre-tax discount rate.
An impairment loss is recognised in profit or loss when the recoverable amount of an asset is
less than its carrying amount. A provision for impairment of the asset is recognised
accordingly. Impairment losses related to an asset group or a set of asset groups are allocated
first to reduce the carrying amount of any goodwill allocated to the asset group or set of asset
groups, and then to reduce the carrying amount of the other assets in the asset group or set of
asset groups on a pro rata basis. However, such allocation would not reduce the carrying
amount of an asset below the highest of its fair value less costs to sell (if measurable), its
present value of expected future cash flows (if determinable) and zero.
Once an impairment loss is recognised, it is not reversed in a subsequent period.
5.22 Fair value measurement
Unless otherwise specified, the Group measures fair value as follows:
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an
orderly transaction between market participants at the measurement date.
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When measuring fair value, the Group takes into account the characteristics of the particular
asset or liability (including the condition and location of the asset and restrictions, if any, on
the sale or use of the asset) that market participants would consider when pricing the asset or
liability at the measurement date, and uses valuation techniques that are appropriate in the
circumstances and for which sufficient data and other information are available to measure
fair value. Valuation techniques mainly include the market approach, the income approach
and the cost approach.
5.23 Revenue
Revenue refers to the gross inflow of economic benefits formed during the course of the
ordinary activities of the Group, which may increase the shareholders’ equities and is
irrelevant to the invested capital of the shareholders.
The Group recognizes the revenue upon fulfillment of its performance obligations in the
contract, that is, the client obtains control right over the relevant goods or services.
If there are two or more performance obligations under the contact, which shall be fulfilled,
the Group will apportion the transaction price to various individual performance obligations
in accordance with the relative proportion of separate selling prices of various goods or
services under these performance obligations on the commencement date of the contract, and
measure and recognize the revenue in accordance with the transaction prices apportioned to
various individual performance obligations. The stand-alone selling price refers to the price at
which the Group sells goods or provides services to customers separately. If the stand-alone
selling price cannot be directly observed, the Group comprehensively considers all the
relevant information that can be reasonably obtained, and uses observable input values to the
greatest extent to estimate the stand-alone selling price.
For contracts with quality assurance clauses, the Group analyzes the nature of the quality
assurance provided. If quality assurance provides a separate service in addition to ensuring to
the client that the goods sold meet the established standards, the Group will treat it as an
individual performance obligation. Otherwise, the Group conducts accounting treatment in
accordance with the Accounting Standards for Business Enterprises No. 13 - Contingencies.
The transaction price refers to the amount of consideration that the Group expects to be
entitled to receive due to the transfer of goods or services to the client, excluding payments
received on behalf of third parties. The transaction price recognized by the Group does not
exceed the amount at which the accumulated recognized revenue will most likely not undergo
a significant reversal when the relevant uncertainty is eliminated. In the event that there is a
significant financing part in the contract, the Group determines the transaction price based on
the amount payable in cash when the client obtains control right over the relevant goods or
services. The difference between the transaction price and the contract consideration shall be
amortized by the effective interest method during the contract period. From the day of the
enforcement of the contract, the Group expects that the interval between the client's
acquisition of control right over the goods or services and the client's payment of the price
will not exceed one year, regardless of the significant financing part in the contract.
If the Group meets one of the following conditions, the fulfillment of its performance
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
obligations in a certain period will be deemed, or the fulfillment of its performance
obligations at a certain time point will be deemed:
- The client obtains and consumes the economic benefits while the Group fulfills the
performance obligation;
- The client manages to control the goods in process while the Group fulfills the
performance obligation.
- Goods produced during the performance period have irreplaceable purposes and the
Group is entitled to charge money for the performance accumulated and has been finished
until the current time within the whole contract period.
For any performance obligations fulfilled in a certain period, the Group will recognize
revenue within the certain period in accordance with the performance progress. If the
performance progress cannot be determined reasonably and costs incurred are expected to be
compensated of the Group, the revenue will be ascertained according to the costs incurred
until the performance progress is determined reasonably.
In terms of performance obligations fulfilled at a certain time point, the Group will recognize
revenue when the client gains control right over the relevant goods or services. When it comes
to determining whether a client has acquired the control right over goods or services, the
Group will consider the following conditions:
- The Group has the current right to receive payment for the goods or services;
- The Group has transferred the goods in kind to the client;
- The Group has transferred the legal ownership of the product or the main risks and
rewards of ownership to the client;
- The client has accepted the goods or services, etc.
For sales with sales return clauses, when the customer obtains control of the relevant goods,
the Group recognizes revenue based on the amount of consideration expected to be entitled to
receive due to the transfer of goods to the customer (that is, does not include the expected
amount to be refunded due to sales return), and recognizes liabilities based on the expected
amount to be refunded due to sales returns. At the same time, based on the book value at the
time of transfer of the goods expected to be returned, the Group recognizes as an asset the
balance after deducting the estimated cost of recovering the goods (including the value
impairment of the returned goods). Based on the book value of the transferred goods at the
time of transfer, the Group carries over as the cost the net amount after deducting the above
asset cost. On each balance sheet date, the Group re-estimates the future sales returns. If there
is any change, it shall be treated as a change in accounting estimates.
The Group has transferred the goods or services to the client and thus has the right to receive
corresponding consideration (and the right is dependable on factors other than time lapses) as
contract asset, which is subject to provision of impairment on the basis of expected credit loss.
The right enjoyed by the Group (only depends on time lapses) to receive consideration
unconditionally from the client shall be presented under account receivables. The Group
presents the obligation of transferring goods or services for the client due to the consideration
received or receivable as contract liabilities.
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The specific accounting policies related to the main activities of the Group’s revenue are
described as follows:
The Group’s sales revenue mainly comes from dealer sales. The revenue will be recognized
when the Group transfers control of the related products to the customer. According to the
business contract, for these transfers, the time when the product is confirmed and signed by
the customer shall be recognized as the confirming point of the sales revenue.
5.24 Contract cost
Contract cost includes incremental cost for being awarded the contract and performance cost
of the contract.
Incremental cost for being awarded the contract refers to the cost that the Group would not
need to pay if no such contracts are awarded (e.g. sales commissions, etc.). Where such cost is
expected to be recovered, the Group shall take it as the contract acquisition cost and recognize
it as an asset. Expenses incurred by the Group to be awarded contracts other than incremental
cost expected to be recovered shall be recognized in current profits and losses when incurred.
Any cost incurred by the Group for the performance of any contract that doesn't fall into the
scope of other businesses specified in the Standard such as inventory, but meets the following
conditions simultaneously, shall be taken as contract performance cost and recognized as an
asset.
– Where such cost is directly related to a current or anticipated contract, including direct
labor cost, direct material cost, manufacturing expenses (or similar expenses), costs clearly
specified to be borne by the customer and other costs incurred solely due to the contract;
– Where such cost includes resources to be used by the Group to fulfill future performance
obligations;
– Where such cost is expected to be recovered.
Assets recognized for contract acquisition cost and assets recognized for contract performance
cost (hereinafter referred to as “assets related to contract cost") shall be amortized on the same
basis as the revenue recognition of goods or services related to such assets and recognized in
current profits and losses. Where the amortization period of assets recognized for the contract
acquisition cost does not exceed one year, they shall be recognized in current profits and
losses.
Where the book value of assets related to contract costs is higher than the difference between
the following two items, the Group shall withdraw the impairment reserves of the excess part
and recognize it as the asset impairment loss:
– Residual consideration expected to be obtained arising from the transfer of goods or
services related to the assets by the Group;
– Cost estimated to be occurred for the transfer of the relevant goods or services.
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
5.25 Employee benefits
5.25.1 Short-term employee benefits
Employee wages or salaries, bonuses, social security contributions such as medical insurance,
work injury insurance, maternity insurance and housing fund, measured at the amount
incurred or accured at the applicable benchmarks and rates, are recognised as a liability as the
employee provides services, with a corresponding charge to profit or loss or included in the
cost of assets where appropriate.
5.25.2 Post-employment benefits – defined contribution plans
Pursuant to the relevant laws and regulations of the People’s Republic of China, the Group
participated in a defined contribution basic pension insurance plan in the social insurance
system established and managed by government organisations. The Group makes
contributions to basic pension insurance plans based on the applicable benchmarks and rates
stipulated by the government. Basic pension insurance contributions payable are recognised
as a liability as the employee provides services, with a corresponding charge to profit or loss
or included in the cost of assets where appropriate.
5.25.3 Termination benefits
When the Group terminates the employment with employees before the employment contracts
expire, or provides compensation under an offer to encourage employees to accept voluntary
redundancy, a provision is recognised with a corresponding expense in profit or loss at the
earlier of the following dates:
- When the Group cannot unilaterally withdraw the offer of termination benefits because of
an employee termination plan or a curtailment proposal;
- When the Group has a formal detailed restructuring plan involving the payment of
termination benefits and has raised a valid expectation in those affected that it will carry out
the restructuring by starting to implement that plan or announcing its main features to those
affected by it.
5.26 Lease liabilities
Upon the commencement the lease term, the Group recognizes right-to-use assets and lease
liabilities for leases as the lessee, provided that short-term leases and leases of low-value
assets subject to simplified treatment are excluded. The Group's lease liabilities shall be
initially measured at the present value of the outstanding lease payments on the
commencement date of the lease term.
When calculating the present value of the lease payment, the Group shall employ the interest
rate implicit in the lease as the discount rate; where the interest rate implicit in the lease
cannot be determined, the incremental lending rate of the Group (i.e., the lessee) shall be used
as the discount rate.
The interest rate implicit in the lease refers to an interest rate at which the sum of the present
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
value of the lessor's lease receipts and the present value of the unsecured residual value equals
the sum of the fair value of the leased asset and the lessor's initial direct costs. The
incremental lending rate of the Lessee refers to an interest rate payable by the Group as a
lessee in a similar economic environment in order to acquire assets with a value similar to that
of the right-to-use assets and to borrow funds under similar mortgage conditions during a
similar period.
The Group calculates the interest expense of lease liabilities in each period of the lease term
according to a fixed periodic rate, which will be included in current profits and losses or asset
cost. The variable lease payment not included in the measurement of lease liabilities shall be
recognized in current profits and losses and loss or related asset cost when they actually occur.
In case of any of following circumstances after the commencement date of the lease term, the
Group will remeasure lease liabilities at the present value of the lease payment after any
change:
– Where the amount payable anticipated changes according to the guaranteed residual
value;
– Where the index or ratio used for recognizing the lease payment changes;
– Where there is a change in the Group's assessment results of the option of purchase,
renewal option or option of termination of lease or the actual exercising of the termination of
the renewal option or option of termination of lease is inconsistent with the original
assessment result.
5.27 Government grants
Government grants are non-reciprocal transfers of monetary or non-monetary assets from the
government to the Group except for capital contributions from the government in the capacity
as an investor in the Group.
A government grant is recognised when there is reasonable assurance that the grant will be
received and that the Group will comply with the conditions attaching to the grant.
If a government grant is in the form of a transfer of a monetary asset, it is measured at the
amount received or receivable. If a government grant is in the form of a transfer of a
non-monetary asset, it is measured at fair value.
Government grants related to assets are grants whose primary condition is that the Group
qualifying for them should purchase, construct or otherwise acquire long-term assets.
Government grants related to income are grants other than those related to assets. A
government grant related to an asset is recognised as deferred income and amortised over the
useful life of the related asset on a reasonable and systematic manner as other income or
non-operating income. A grant that compensates the Company for expenses or losses to be
incurred in the future is recognised as deferred income, and included in other income or
non-operating income in the periods in which the expenses or losses are recognised, or
included in other income or non-operating income directly.
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5.28 Income tax
Current tax and deferred tax are recognised in profit or loss except to the extent that they
relate to a business combination or items recognised directly in equity (including other
comprehensive income).
Current tax is the expected tax payable calculated at the applicable tax rate on taxable income
for the year, plus any adjustment to tax payable in respect of previous years.
At the balance sheet date, current tax assets and liabilities are offset only if the Group has a
legally enforceable right to set them off and also intends either to settle on a net basis or to
realise the asset and settle the liability simultaneously.
Deferred tax assets and deferred tax liabilities arise from deductible and taxable temporary
differences respectively, being the differences between the carrying amounts of assets and
liabilities for financial reporting purposes and their tax bases, which include the deductible
losses and tax credits carried forward to subsequent periods. Deferred tax assets are
recognised to the extent that it is probable that future taxable profits will be available against
which deductible temporary differences can be utilised.
Deferred tax is not recognised for the temporary differences arising from the initial
recognition of assets or liabilities in a transaction that is not a business combination and that
affects neither accounting profit nor taxable profit (or deductible loss). Deferred tax is not
recognised for taxable temporary differences arising from the initial recognition of goodwill.
At the balance sheet date, deferred tax is measured based on the tax consequences that would
follow from the expected manner of recovery or settlement of the carrying amounts of the
assets and liabilities, using tax rates enacted at the balance sheet date that are expected to be
applied in the period when the asset is recovered or the liability is settled.
The carrying amount of a deferred tax asset is reviewed at each balance sheet date, and is
reduced to the extent that it is no longer probable that the related tax benefits will be utilised.
Such reduction is reversed to the extent that it becomes probable that sufficient taxable profits
will be available.
At the balance sheet date, deferred tax assets and deferred tax liabilities are offset if all of the
following conditions are met:
- the taxable entity has a legally enforceable right to offset current tax liabilities and current
tax assets;
- they relate to income taxes levied by the same tax authority on either: the same taxable
entity; or different taxable entities which intend either to settle the current tax liabilities and
current tax assets on a net basis, or to realise the assets and settle the liabilities simultaneously,
in each future period in which significant amounts of deferred tax liabilities or deferred tax
assets are expected to be settled or recovered.
5.29 Lease
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Lease refers to a contract in which it is agreed that the lessor transfers the use right of assets
to the lessee to get corresponding consideration within a certain period.
On the contract start/change date, the Group shall evaluate whether the contract is a lease or
includes a lease. Where either party thereto assigns one or more use rights of the recognized
assets under its control in a certain period to get consideration, the contract is a lease or
includes a lease. Unless there is any change in the terms and conditions thereof, the Group
shall not evaluate again whether the contract is a lease or includes a lease.
If the contract contains multiple separate leases at the same time, the lessee and lessor will
split the contract and have each separate lease separately subject to accounting treatment. If
the contract includes lease and non-lease parts at the same time, the lessee and the lessor will
split them separately.
5.29.1 Where the Group is the lessee
(a) See Notes III, 17 for the general accounting treatment of right-to-use assets;
(b) See Notes III, 26 for the general accounting treatment of leased liabilities;
(c) Short-term lease and lease of low-value assets
The Group does not recognize right-to-use assets and leased liabilities for short-term lease
and lease of low-value assets. Short-term lease refers to any lease with a lease term within 12
months from the beginning date of the lease term, excluding option of purchase. Lease of
low-value assets refers to low-value lease when a single lease asset is regarded as a new asset.
The Group shall include the lease payment of short-term lease and lease of low-value assets
into the current profits and losses or relevant asset costs according to the straight-line method
in each period of the lease term.
(d) Lease change
If there is any lease change and the following conditions are met at the same time, the Group
will have such a lease change subject to accounting treatment as a separate lease:
– Where such a lease change expands the scope of the lease by adding one or more use
rights to leased assets;
– Where the increased consideration is equivalent to the separate price of the expanded
portion of the scope of the lease adjusted according to the contract.
Where such a lease change is not regarded as a separate lease for accounting treatment, the
Group shall re-apportion the consideration of the contract after such a change, re-determine
the lease term, and re-measure the leased liabilities according to the present value of the lease
payment after the change and the revised discount rate on the effective date of such a lease
change.
Where any lease change results in decreased lease scope or shortened lease term, the Group
shall correspondingly reduce the book value of right-to-use assets and recognize gains or
losses related to the partially or completely terminated lease in current profits and losses.
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Where any other lease change results in remeasurement of leased liabilities, the Group shall
correspondingly adjust the book value of right-to-use assets.
5.29.2 The Group as the lessor
(a) Lease classification
From the inception of lease, the Group will divide leases into finance lease and operating
lease as the lessor. Finance lease refers to a lease in which almost all the risks and returns
related to the ownership of the leased asset are essentially transferred, regardless of whether
the ownership is finally transferred or not. Operating lease refers to other leases except for the
finance lease. When the Group is the sublease lessor, the sublease shall be classified based on
the right-to-use assets arising from the original lease.
(b) The Group will record operating lease business as the lessor.
During each period of the lease term, the Group recognizes lease receipts from operating
leases as rental revenue by using the straight-line method. The Group capitalizes initial direct
costs pertaining to operating leases upon their occurrence, and apportions them as per the
same basis used for recognizing the rental income within the lease term and includes them in
current profits and losses by period. The Group's variable lease receipts related to operating
leases that are not included in the lease receipts shall be recognized in current profits and
losses when they actually occur.
(c) Accounting treatment method of finance leases
From the commencement date of the lease term, the Group recognizes finance lease
receivables for finance leases and derecognizes the related assets. The Group regards the net
investment in a lease as the entry value of finance lease receivables at the time of initial
measurement of finance lease receivables. The net investment in a lease is the sum of the
present value of unguaranteed residual value and rental receipts not received yet on the
commencement date of the lease term which is subject to discounting at the interest rate
implicit in the lease term.
The Group calculates and recognizes the interest income in each period within the lease term
according to a fixed periodic rate. Derecognition and impairment of finance lease receivables
shall be subject to accounting treatment in accordance with Note V.9 hereto. The variable
lease payment which is not included in the net investment in a lease, shall be recognized in
current profits and losses when it actually occurs.
(d) Lease change
Where any finance lease of which the Group is the lessor changes and the following
conditions are met at the same time, the Group will have such a change subject to accounting
treatment as a separate lease:
- Where such a change expands the scope of the lease by adding one or more use rights to
leased assets;
- Where the increased consideration is equivalent to the separate price of the expanded
portion of the scope of the lease adjusted according to the contract.
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Where such a change of finance lease is not subject to accounting treatment as a separate
lease, the Group, as the lessor, will treat the changed lease in any of the following
circumstances.
- Where such a change becomes effective on the inception of lease and the lease will be
classified as an operating lease, the Group, as the lessor, will have it subject to accounting
treatment as a new lease from the effective date of such a lease change and take the net
investment in a lease prior to the effective date of such a lease change as the carrying
value of the leased asset.
- Where such a change becomes effective on the inception of lease and the lease will be
classified as a finance lease, the Group, as the lessor, will have it subject to accounting
treatment in accordance with the provisions regarding the modification or renegotiation of
contracts specified in the Accounting Standard for Business Enterprises No. 22 -
Recognition and Measurement Instruments. In other words, where a modification or
renegotiation of a lease contract does not result in the derecognition of finance lease
receivables, but a change in future cash flows, the carrying amount of such finance lease
receivables will be recalculated and the related gain or loss recognized in current profits
and losses. The carrying amount of finance lease receivables will be determined on the
basis of cash flows from the renegotiated or modified lease contract discounted at the
original discount rate of finance lease receivables or at the present value of the discount
rate recalculated in accordance with Article 23 of Accounting Standard for Business
Enterprises No. 24 - Hedge Accounting (2017), where applicable. For all costs and
expenses incurred by modifying or renegotiating the lease contract, the Group will adjust
the carrying amount of the modified finance lease receivables and amortize them over the
remaining term of such modified finance lease receivables.
In the event of any change in an operating lease of which the Group is the lessor, the Group
will have it subject to accounting treatment as a new lease from the effective date of the
change, and the amount of lease receipts received in advance or receivable relating to the
lease prior to such change will be taken as an amount received under the new lease.
5.29.3 Leaseback transaction
The Group assesses whether the transfer of assets in sale-and-leaseback transactions is a sale
in accordance with the principles described in Note V.23 hereto.
(a) The Group as the seller and lessee:
Where any asset transfer in sale and leaseback transactions falls into the range of sales, the
Company, as a lessee, will measure the right-to-use assets formed by sale and leaseback and
recognize profit or loss only related to the right transferred to the lessor according to the part
in the original asset book value relating to right-to-use assets gained by leaseback. Where any
asset transfer in sale and leaseback transactions does not fall into the range of sales, the
Company, as a lessee, will continue to recognize the transferred asset and a financial liability
equivalent to the transfer income. Please refer to Note V.9 hereto for details of accounting
treatment of financial liability.
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
(b) The Group as the buyer and lessor
Where any asset transfer in sale and leaseback transactions falls into the range of sales, the
Company, as the lessor, will have the purchase of assets subject to accounting treatment and
also have the lease of assets subject to the same in accordance with the aforementioned “(2)
The Group as the lessor". Where any asset transfer in sale and leaseback transactions does not
fall into the range of sales, the Company, as a lessor, will not recognize the transferred asset,
but recognize a financial asset equivalent to the transfer income. Please refer to Note V.9
hereto for details of accounting treatment of financial asset.
5.30 Assets held for sale
The Group classified a non-current asset or disposal group as held for sale when the carrying
amount of a non-current asset or disposal group will be recovered through a sale transaction
rather than through continuing use.
A disposal group refers to a group of assets to be disposed of, by sale or otherwise, together as
a whole in a single transaction and liabilities directly associated with those assets that will be
transferred in the transaction.
A non-current asset or disposal group is classified as held for sale when all the following
criteria are met:
- According to the customary practices of selling such asset or disposal group in similar
transactions, the non-current asset or disposal group must be available for immediate sale in
their present condition subject to terms that are usual and customary for sales of such assets or
disposal groups;
- Its sale is highly probable, that is, the Group has made a resolution on a sale plan and has
obtained a firm purchase commitment. The sale is to be completed within one year.
Non-current assets or disposal groups held for sale are stated at the lower of carrying amount
and fair value less costs to sell (except financial assets, deferred tax assets and investment
properties subsequent measured at fair value initially and subsequently. Any excess of the
carrying amount over the fair value less costs to sell is recognised as an impairment loss in
profit or loss.
5.31 Profit distributions
Dividends or profit distributions proposed in the profit appropriation plan, which will be
approved after the balance sheet date, are not recognised as a liability at the balance sheet date
but are disclosed in the notes separately.
5.32 Related parties
If a party has the power to control, jointly control or exercise significant influence over
another party, or vice versa, or where two or more parties are subject to common control or
joint control from another party, they are considered to be related parties. Related parties may
be individuals or enterprises. Enterprises with which the Company is under common control
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
only from the State and that have no other related party relationships are not regarded as
related parties.
In addition to the related parties stated above, the Group determines related parties based on
the disclosure requirements of Administrative Procedures on the Information Disclosures of
Listed Companies issued by the CSRC.
5.33 Segment reporting
The Group is principally engaged in the production and sales of wine, brandy, and sparkling
wine in China, France, Spain, Chile and Australia. In accordance with the Group's internal
organisation structure, management requirements and internal reporting system, the Group's
operation is divided into four parts: China, Spain, France, Chile and Australia. The
management periodically evaluates segment results, in order to allocate resources and
evaluate performances. In 2021, over 86% of revenue, more than 98% of profit and over 97%
of non-current assets derived from China / are located in China. Therefore the Group does not
need to disclose additional segment report information.
5.34 Significant accounting estimates and judgements
The preparation of the financial statements requires management to make estimates and
assumptions that affect the application of accounting policies and the reported amounts of
assets, liabilities, income and expenses. Actual results may differ from these estimates.
Estimates as well as underlying assumptions and uncertainties involved are reviewed on an
ongoing basis. Revisions to accounting estimates are recognised in the period in which the
estimate is revised and in any future periods affected.
5.34.1 Significant accounting estimates
Except for accounting estimates relating to depreciation and amortisation of assets such as
investment properties, fixed assets, bearer biological assets and intangible assets (see Notes
5.12, 13, 16 and 18) and provision for impairment of various types of assets (see Notes 7.2, 5,
6, 10, 11, 12, 13, 14 and Notes 17.1 and 2). Other significant accounting estimates are as
follows:
(i) Note 7.17 – Recognition of deferred tax asset;
(ii) Note 11. – Fair value measurements of financial instruments.
5.35 Changes in significant accounting policies and accounting estimates
5.35.1 Changes in significant accounting policies
The Ministry of Finance issued the Accounting Standard for Business Enterprises No. 21 -
Lease (Revised in 2018) (Cai Kuai [2018] No. 35) (hereinafter referred to as “Accounting
Standard No.21”) on December 7, 2018. After deliberation and approval at the seventh
meeting of the Eighth Board of Directors of the Company, the Group has implemented the
aforesaid Accounting Standard No.21 from January 1, 2021, and changed relevant accounting
policies as provided therein.
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
According to the Accounting Standard No.21, the Group has elected not to reassess whether a
contract existing prior to the date of initial execution is a lease or contains a lease.
The Group has elected to adjust only the cumulative impact number for lease contracts
outstanding as of January 1, 2020. For the cumulative impact amount of the first execution,
the amount of retained earnings and other relevant items in the financial statements at the
beginning of the first execution period (i.e. January 1, 2021) is adjusted, while the information
in the comparable period not adjusted.
On the date of initial execution of the Accounting Standard No.21 (i.e. January 1, 2021), the
Group's specific linking-up treatment and its impact are as follows:
The Group as the lessee
For operating leases on the date of initial execution, leased liabilities are measured as the
present value of the lessee's liability based on the present value of remaining lease payments
discounted at the incremental lending rate on the date of initial execution. The unpaid rentals
payable under the original lease standard, which were accrued on an accrual basis, are
included in the remaining lease payments.
For operating leases falling into the category of houses, buildings and structures prior to the
date of initial execution, the Group measures right-to-use assets in accordance with the
assumption that the Accounting Standard No.21 has been adopted from the commencement
date of the lease term and that the incremental lending rate on the date of initial execution is
taken as the discount rate. The Group conducts impairment tests on the right-to-use assets on
the date of initial execution without adjusting the book value of such assets.
The Group does not recognize right-to-use assets and leased liabilities for operating leases
where leased assets are low-value ones prior to the date of initial execution. For operating
leases other than low-value leases on the date of initial execution, the Group applies one or
more of the following simplified treatments depending on each lease:
- Any lease to be completed within 12 months after the date of initial execution, is regarded
as a short-term lease for treatment;
- When leased liabilities are measured, the same discount rate is used for leases with similar
characteristics;
- Right-to-use assets are measured with initial direct costs excluded;
- When there is any option to renew or option to terminate the lease, the lease term will be
recognized by the Group in accordance with actual exercising of the option and other
up-to-date states before the date of initial execution;
- As an alternative to the impairment test of right-to-use assets, whether a contract including
is an onerous contract is evaluated before the date of initial execution pursuant to the
Accounting Standard for Business Enterprises No.13 - Contingencies and the right-to-use
assets adjusted by the Group according to the loss reserves included in the balance sheet
before the date of initial execution;
- If a lease change occurs before the date of initial execution, the Group will have it subject
to accounting treatment according to the final arrangement of such a lease change.
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
The Group as the lessor
The Group does not need to adjust the amount of retained earnings and other related items in
the financial statements for leases in which the Group is the lessor at the beginning of the year
when the Accounting Standard No.21 is initially executed. The Group will conduct
accounting treatment in accordance with the Accounting Standard No.21 from the date of
initial execution.
The execution of the Accounting Standard No.21 on January 1, 2021 has no material impact
on financial statements of both the Group and the Company.
5.35.2 Changes in significant accounting estimates
Nil
5.35.3 Particulars of first implementation of new lease standards to adjust the first
implementation of related items in the financial statements at the beginning of the year
Consolidated Balance Sheet
Unit: Yuan
Item December 31, 2020 January 1, 2021 Adjustments
Current assets:
Monetary fund 1,194,214,929 1,194,214,929
Settlement reserves
Lending funds
Tradable financial assets
Derivative financial assets
Bills receivable
Accounts receivable 183,853,362 183,853,362
Receivables financing 338,090,187 338,090,187
Advance payment 71,296,416 71,296,416
Premium receivable
Reinsurance accounts receivable
Receivable reserves for reinsurance contract
Other receivables 22,428,956 22,428,956
Including: Interest receivable
Dividends receivable
Redemptory monetary capital for sale
Inventories 2,945,548,651 2,945,548,651
Contract assets
Assets held for sale
Non-current assets due within one year
Other current assets 234,118,715 234,118,715
Total current assets 4,989,551,216 4,989,551,216
Non-current assets:
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item December 31, 2020 January 1, 2021 Adjustments
Offering loans and imprest
Debt investments
Other debt investments
Long-term receivables
Long-term equity investments 48,263,507 48,263,507
Other investments in equity instruments
Other non-current financial assets
Investment real estate 27,057,730 27,057,730
Fixed assets 5,724,935,846 5,724,935,846
Construction in progress 635,495,152 635,495,152
Productive biological assets 192,173,536 192,173,536
Oil-and-gas assets
Right-of-use assets 104,654,936 104,654,936
Intangible assets 660,989,065 660,989,065
Development expenditure
Goodwill 132,938,212 132,938,212
Long-term prepaid expenses 314,465,855 306,090,617 -8,375,238
Deferred income tax assets 206,241,275 207,199,400 958,125
Other non-current assets 170,370,147 170,370,147
Total non-current assets 8,112,930,325 8,210,168,148 97,237,823
Total assets 13,102,481,541 13,199,719,364 97,237,823
Current liabilities:
Short-term loans 689,090,715 689,090,715
Borrowings from the Central Bank
Loans from other banks and other financial institutions
Tradable financial liabilities
Derivative financial liabilities
Bills payable
Accounts payable 484,347,958 479,305,382 -5,042,576
Advances from customers
Contract liabilities 135,073,280 135,073,280
Financial assets sold for repurchase
Deposits from customers and interbank
Receivings from vicariously traded securities
Receivings from vicariously sold securities
Employee remunerations payable 188,779,911 188,779,911
Taxes and dues payable 213,412,813 213,412,813
Other payables 386,105,526 386,105,526
Including: Interest payable 553,471 553,471
Dividends payable 1,003,125 1,003,125
Handling charges and commissions payable
Dividend payable for reinsurance
Liabilities held for sale
Non-current liabilities due within one year 133,311,890 141,497,136 8,185,246
Other current liabilities 14,820,653 14,820,653
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item December 31, 2020 January 1, 2021 Adjustments
Total current liabilities 2,244,942,746 2,248,085,416 3,142,670
Non-current liabilities:
Reserves for insurance contracts
Long-term borrowings 200,352,968 200,352,968
Bonds payable
Including: Preferred stock
Perpetual bonds
Lease liabilities 104,489,294 104,489,294
Long-term accounts payable 86,000,000 86,000,000
Long-term employee remunerations payable
Estimated liabilities
Deferred income 52,653,609 52,653,609
Deferred income tax liabilities 12,022,613 12,260,894 238,281
Other non-current liabilities 2,078,971 2,078,971
Total non-current liabilities 353,108,161 457,835,736 104,727,575
Total liabilities 2,598,050,907 2,705,921,152 107,870,245
Owner’s equity:
Capital stock 685,464,000 685,464,000
Other equity instruments
Including: Preferred stock
Perpetual bonds
Capital surplus 524,968,760 524,968,760
Minus: Treasury stock
Other comprehensive income 576,129 576,129
Special reserves
Surplus reserves 342,732,000 342,732,000
General risk preparation
Undistributed profit 8,714,091,755 8,703,459,333 -10,632,422
Total owner’s equities attributable to the parent company 10,267,832,644 10,257,200,222 -10,632,422
Minority equity 236,597,990 236,597,990
Total owner’s equities 10,504,430,634 10,493,798,212 -10,632,422
Total liabilities and owner’s equities 13,102,481,541 13,199,719,364 97,237,823
Balance Sheet of the Parent Company
Unit: Yuan
Item December 31, 2020 January 1, 2020 Adjustments
Current assets:
Monetary fund 267,548,326 267,548,326
Tradable financial assets
Derivative financial assets
Bills receivable
Accounts receivable
Receivables financing 13,920,000 13,920,000
Advance payment 171,709 171,709
Other receivables 580,131,798 580,131,798
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item December 31, 2020 January 1, 2020 Adjustments
Including: Interest receivable
Dividends receivable 200,000,000 200,000,000
Inventories 482,442,935 482,442,935
Contract assets
Assets held for sale
Non-current assets due within one year
Other current assets 24,842,325 24,842,325
Total current assets 1,369,057,093 1,369,057,093
Non-current assets:
Debt investments
Other debt investments
Long-term receivables
Long-term equity investments 7,599,778,880 7,599,778,880
Other investments in equity instruments
Other non-current financial assets
Investment real estate 27,057,730 27,057,730
Fixed assets 243,634,747 243,634,747
Construction in progress 2,865,243 2,865,243
Productive biological assets 115,103,753 115,103,753
Oil and gas assets
Right-of-use assets 44,816,966 44,816,966
Intangible assets 80,789,731 80,789,731
Development expenditure
Goodwill
Long-term prepaid expenses
Deferred income tax assets 18,285,685 18,285,685
Other non-current assets 1,530,700,000 1,530,700,000
Total non-current assets 9,618,215,769 9,663,032,735 44,816,966
Total assets 10,987,272,862 11,032,089,828 44,816,966
Current liabilities:
Short-term loans 150,000,000 150,000,000
Tradable financial liabilities
Derivative financial liabilities
Bills payable
Accounts payable 76,470,081 76,470,081
Advances from customers
Contract liabilities
Employee remunerations 67,808,910 67,808,910
Taxes and dues payable 9,123,959 9,123,959
Other payables 521,505,947 521,505,947
Including: Interest payable 181,250 181,250
Dividends payable
Liabilities held for sale
Non-current liabilities due within one year 3,624,896 3,624,896
Other current liabilities
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item December 31, 2020 January 1, 2020 Adjustments
Total current liabilities 824,908,897 828,533,793 3,624,896
Non-current liabilities:
Long-term borrowings
Bonds payable
Including: Preferred stock
Perpetual bonds
Lease liabilities 47,393,235 47,393,235
Long-term accounts payable
Long-term employee remuneration payable
Estimated liabilities
Deferred income 5,507,708 5,507,708
Deferred income tax liabilities 88,555 88,555
Other non-current liabilities 1,164,471 1,164,471
Total non-current liabilities 6,672,179 54,153,969 47,481,790
Total liabilities 831,581,076 882,687,762 51,106,686
Owner’s equity:
Capital stock 685,464,000 685,464,000
Other equity instruments
Including: Preferred stock
Perpetual bonds
Capital surplus 560,182,235 560,182,235
Minus: Treasury stock
Other comprehensive income
Special reserves
Surplus reserves 342,732,000 342,732,000
Undistributed profit 8,567,313,551 8,561,023,831 -6,289,720
Total owner’s equities 10,155,691,786 10,149,402,066 -6,289,720
Total liabilities and owner’s equities 10,987,272,862 11,032,089,828 44,816,966
Adjustment Explanation
The Company has implemented the new lease standard from January 1, 2021. According to
the stipulation of new lease standard, the Company has elected not to reassess whether a
contract existing prior to the date of initial execution is a lease or contains a lease. The
Company has elected to adjust only the cumulative impact number for lease contracts
outstanding as of January 1, 2021. For the cumulative impact amount of the first execution,
the amount of relevant items in the financial statements at the beginning of the first execution
period (i.e. January 1, 2021) is adjusted, while the information in the comparable period not
adjusted.
6. Taxes
6.1 The main taxes and tax rates are as follows:
Tax category Taxation basis Tax rates
Value added tax Levied on the balance between the 13%, 9%, 6% (China), 20% (France),
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
output tax calculated based on taxable 21% (Spain), 19% (Chile), 10%
income and the input tax allowed to be (Australia)
deducted in current period
10% of the price, 20% of the price and
Consumption tax Levied on taxable income
1,000 Yuan each ton (China)
City development tax Levied on circulation tax actually paid 7% (China)
25% (China), 28% (France), 28%
Corporate income tax Levied on taxable income
(Spain), 27% (Chile), 30% (Australia)
6.2 Tax incentives
Ningxia Changyu Grape Growing Co., Ltd. (“Ningxia Growing”), a subsidiary of the Group,
whose principal activity is grape growing, is incorporated in Ningxia Huizu Autonomous
Region. According to clause 27 of PRC Corporate Income Tax and clause 86 of PRC
Corporate Income Tax Measures for Implementation, Ningxia Growing enjoys an exemption
of corporate income tax.
Yantai Changyu Grape Growing Co., Ltd. (“Grape Growing”), a branch of the Company,
whose principal activity is grape growing, is incorporated in Zhifu District, Yantai City,
Shandong Province. According to clause 27 of PRC Corporate Income Tax and clause 86 of
PRC Corporate Income Tax Measures for Implementation, Grape Growing enjoys an
exemption of corporate income tax.
Grape Planting Branch of Yantai Changyu Wine R&D and Manufacturing Co., Ltd. (“R&D
and Growing”), a branch of the Company, whose principal activity is grape growing, is
incorporated in YEDA, Shandong Province. According to Clause 27 of PRC Corporate
Income Tax and Clause 86 of PRC Corporate Income Tax Measures for Implementation, R&D
and Growing enjoys an exemption of corporate income tax.
Beijing Changyu AFIP Agriculture Development Co., Ltd (“Agriculture Development”), a
subsidiary of the Group, whose principal activity is grape growing, is incorporated in Miyun
County, Beijing. According to clause 27 of the Corporate Income Tax Law of the People’s
Republic of China and clause 86 of the Implementation Rules of Enterprise Income Tax Law
of the People’s Republic of China, Agriculture Development enjoys an exemption of corporate
income tax.
Xinjiang Tianzhu Co., Ltd (“Xinjiang Tianzhu”), a subsidiary of the Company, is an enterprise
of wine production and sales incorporated in Shihezi City, Xinjiang Uygur Autonomous
Region. In accordance with the Announcement on Continuing the Enterprise Income Tax
Policies for the Large-Scale Development of Western China of the Ministry of Finance, the
State Taxation Administration and the National Development and Reform Commission
(Announcement No. 23 [2020] of the Ministry of Finance), Xinjiang Tianzhu is qualified to
enjoy preferential taxation policies, which means it can pay corporate income tax at a
preferential rate of 15% for the period from 2021 to 2030.
Xinjiang Babao Baron Chateau Co., Ltd. (“Shihezi Chateau”), a subsidiary of the Company, is
an enterprise of wine production and sales incorporated in Shihezi City, Xinjiang Uygur
Autonomous Region. In accordance with Announcement on Continuing the Enterprise Income
Tax Policies for the Large-Scale Development of Western China of the Ministry of Finance,
57
2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
the State Taxation Administration and the National Development and Reform Commission
(Announcement No. 23 [2020] of the Ministry of Finance), Shihezi Chateau is qualified to
enjoy preferential taxation policies, which means it can pay corporate income tax at a
preferential rate of 15% for the period from 2021 to 2030.
Chateau Changyu Moser XV Co., Ltd., Ningxia (“Ningxia Chateau”), a subsidiary of the
Company, is an enterprise of wine production and sales incorporated in Yinchuan City,
Ningxia Huizu Autonomous Region. In accordance with Announcement on Continuing the
Enterprise Income Tax Policies for the Large-Scale Development of Western China of the
Ministry of Finance, the State Taxation Administration and the National Development and
Reform Commission (Announcement No. 23 [2020] of the Ministry of Finance), Ningxia
Chateau is qualified to enjoy preferential taxation policies, which means it can pay corporate
income tax at a preferential rate of 15% for the period from 2021 to 2030.
Changyu (Ningxia) Wine Co., Ltd. (“Ningxia Wine”), a subsidiary of the Company, is an
enterprise of wine production and sales incorporated in Yinchuan City, Ningxia Huizu
Autonomous Region. In accordance with Announcement on Continuing the Enterprise Income
Tax Policies for the Large-Scale Development of Western China of the Ministry of Finance,
the State Taxation Administration and the National Development and Reform Commission
(Announcement No. 23 [2020] of the Ministry of Finance), Ningxia Wine is qualified to enjoy
preferential taxation policies, which means it can pay corporate income tax at a preferential
rate of 15% for the period from 2021 to 2030.
According to the provisions of the Announcement of the Ministry of Finance and the State
Taxation Administration on Continuing the Implementation of Certain Tax Preferential
Policies Responding to the COVID-19 Outbreak (Announcement No. 7 of [2021] of the
Ministry of Finance and the State Taxation Administration), the implementation period for the
preferential tax policies specified in the Announcement of the Ministry of Finance and the
State Administration of Taxation on Relavant Donation Tax Policies Supporting the
Prevention and Control of the Outbreak of Novel Coronavirus Pneumonia Caused by
COVID-19 (Annoucement No. 9 [2020] of the Ministry of Finance and the State Taxation
Administration) shall be extended until March 31, 2021. The Company’s Yantai Changyu
Wine Culture Museum Co., Ltd. (“Museum”) and other subsidiaries provide catering,
accommodation, tourism and other life services. Income from the provision of life services is
exempt from VAT from January 1, 2021 to March 31, 2021.
The Company’s subsidiary Xinjiang Changyu Wine Sales Co., Ltd. Weimeisi Tasting Center
Branch (“Xinjiang Tasting”) is a large-scale restaurant service company located in Shihezi
City, Xinjiang. According to the Announcement of the Ministry of Finance and the State
Taxation Administration on the Value-Added Tax Policies on Supporting the Resumption of
Work and Business of Individual Industrial and Commercial Households (No. 13 [2020]) and
the Announcement of the Ministry of Finance and the State Taxation Administration on
Continuing the Implementation of Certain Tax Preferential Policies Responding to the
COVID-19 Outbreak (Announcement No. 7 of [2021] of the Ministry of Finance and the State
Taxation Administration), it enjoys a preferential policy of 1% VAT collection rate for
small-scale taxpayers in 2021.
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7. Notes to items in the consolidated financial statement
7.1 Monetary capital
Unit: Yuan
Item Ending balance Beginning balance
Cash on hand 32,865 19,637
Bank deposit 1,468,546,985 1,128,882,937
Other monetary capital 45,151,190 65,312,355
Total 1,513,731,040 1,194,214,929
Including: Total overseas deposits 42,814,048 47,674,019
As at June 30, 2021, the restricted bank deposit details are listed as follows:
Unit: Yuan
Item Ending balance Beginning balance
Housing fund of the unit 2,641,994 2,684,407
Total 2,641,994 2,684,407
As at June 30, 2020, the details of other monetary funds are listed as follows:
Unit: Yuan
Item Ending balance Beginning balance
Pledge of fixed deposits by Yantai Changyu Wine Research,
20,000,000
Development and Manufacture Co., Ltd. (“R&D Company”)
Guaranteed deposits paid for the letter of credit 44,540,850 44,540,850
Account balance of Alipay 600,340 761,505
Guaranty money for ICBC platform 10,000 10,000
Total 45,151,190 65,312,355
As at June 30, 2021, the bank deposits of the Group including short-term fixed deposits
ranging from 3 months to 12 months amounted to RMB 73,553,062 Yuan (December 31,
2020: RMB 73,553,062), with the interest rates ranging from 1.5% to 2.25%.
7.2 Bills receivable
7.2.1 Classification of bills receivable
Unit: Yuan
Ending balance Beginning balance
Provision for bad Provision for bad
Type Book balance Book balance
debts debts
Book value Book value
Amount Proportion Amount Accrued Amount Proportion Amount Accrued
proportion proportion
Accounts
receivable
for which
provision for
bad debts is
accrued on a
single item
basis
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Accounts
receivable
for which
provision for
187,739,811 100% 18,503,554 9.86% 169,236,257 196,179,968 100% 12,326,606 6.30% 183,853,362
bad debts is
accrued on a
combined
basis
Total 187,739,811 100% 18,503,554 9.86% 169,236,257 196,179,968 100% 12,326,606 6.30% 183,853,362
Provision for bad debts accrued on a combined basis:
Unit: Yuan
Ending balance
Name
Book balance Provision for bad debts Accrued proportion
Amounts due from related
399,844 2,526.23 0.63%
parties
Amounts due from other
187,339,967 18,501,027.77 9.88%
customers
Total 187,739,811 18,503,554 --
Disclosed by age:
Unit: Yuan
Age Ending balance
Within 1 year (including 1 year) 178,544,958
1-2 years 6,193,356
2-3 years 3,001,497
Over 3 years
Total 187,739,811
As at June 30, 2021, the accounts receivable with ownership restrictions were RMB
44,245,910 Yuan (December 31, 2020: 28,557,991 Yuan). Please refer to Note 7.19 for details.
7.2.2 Provision for bad debts accrued, withdrawn or transferred back in this period
Provision for bad debts accrued in this period:
Unit: Yuan
Beginning Changes in this period
Ending
Type balance of the Withdrawn or
Accrued Cancelled balance
year transferred back
Accounts receivable for which
12,326,606 6,176,948 18,503,554
provision for bad debts is accrued
Total 12,326,606 6,176,948 18,503,554
7.2.3 Accounts receivable actually cancelled after verification in this period
Nil
7.2.4 Accounts receivable collected by the borrowers of top 5 units ranked by the ending
balance
Unit: Yuan
Percentage in total Ending balance of
Relationship with
Unit Amount Period accounts provision for bad
the Group
receivable and doubtful debts
60
2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Lianhua Supermarket
Third party 9,751,234 Within 1 year 5.20% 1,782,383
Holdings Co., Ltd.
Inland Trading Co Third party 8,342,885 Within 1 year 4.40% 114,255
Nonggongshang
Supermarket (Group) Co., Third party 6,978,820 Within 2 years 3.70% 5,844,945
Ltd.
Sainsburys Supermarkets
Third party 4,851,068 Within 1 year 2.60% 62,591
Ltd
COOP DENMARK A/S Third party 3,760,513 Within 1 year 2.00% 48,520
Total -- 33,684,520 -- 17.90% 7,852,694
7.2.5 Accounts receivable terminating recognition due to transfer of financial assets
Nil
7.2.6 Accounts receivable transferred and included in assets and liabilities
Nil
7.3 Receivables financing
Unit: Yuan
Item Ending balance Beginning balance
Bills receivable 338,278,251 338,090,187
Total 338,278,251 338,090,187
7.3.1 The pledged bills receivable of the Group at the end of the year
Nil
7.3.2 Outstanding endorsed bills that have not matured at the end of the year
Item Amount derecognised at year end
Bank acceptance bills 79,930,626
Total 79,930,626
As at June 30, 2021, bills endorsed by the Group to other parties which are not yet due at the
end of the period is RMB 79,930,626 Yuan (December 31, 2020: RMB 260,721,441 Yuan).
The notes are used for payment to suppliers and constructions. The Group believes that due to
good reputation of bank, the risk of notes not accepting by bank on maturity is very low,
therefore derecognise the note receivables endorsed. If the bank is unable to pay the notes on
maturity, according to the relevant laws and regulations of China, the Group would undertake
limited liability for the notes.
7.4 Advance payment
7.4.1 Advance payment listed by age
Unit: Yuan
61
2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Ending balance Beginning sum
Age
Amount Proportion Amount Proportion
Within 1 year 7,957,433 99.12% 70,977,636 99.60%
1-2 years 70,279 0.88% 318,780 0.40%
2-3 years
More than 3 years
Total 8,027,712 -- 71,296,416 --
7.4.2 Advance payment collected by the prepaid parties of top 5 units ranked by the
ending balance
Unit: Yuan
Percentage in the
Relationship with Reason for
Category of client Amount Age total advance
the Group unsettlement
payment%
Chile SOCIEDAD AGRICOLA
Third party 1,039,773 Within 1 year Prepayments 13.0%
REQUINGUA LTDA.
State Grid Shandong Electronic Prepaid
Third party 673,128 Within 1 year 8.4%
Power Yantai Company electricity fees
Yantai Yanghang Intelligent
Third party 150,008 Within 1 year Prepayments 1.9%
Technology Co., Ltd.
Sinopec Sales Co., Ltd. Shandong
Third party 130,000 Within 1 year Prepaid fuel cost 1.6%
Yantai Petroleum Branch
Chongqing Yirong Glass Products
Third party 79,000 Within 1 year Prepayments 1.0%
Co., Ltd.
Total -- 2,071,909 -- 25.90%
7.5 Other receivables
Unit: Yuan
Item Ending balance Beginning balance
Interest receivable
Dividends receivable
Other receivables 22,861,668 22,428,956
Total 22,861,668 22,428,956
Other receivables
7.5.1 Other receivables classified by nature
Unit: Yuan
Nature Ending book balance Beginning book balance
Deposit and guaranty money receivable 6,225,930 10,287,959
Consumption tax and added-value tax export rebate 7,453,412 8,254,195
Imprest receivable 519,647 124,878
Other 8,662,679 3,761,924
Total 22,861,668 22,428,956
7.5.2 Disclosed by age
Unit: Yuan
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Age Ending balance
Within 1 year (including 1 year) 16,935,627
1-2 years 1,027,718
2-3 years 986,592
More than 3 years 3,911,731
Total 22,861,668
7.5.3 Provision for bad debts accrued, withdrawn or transferred back in this period
The provision for bad debts accrued in this period was RMB 0 Yuan; and that withdrawn or
transferred back in this period was RMB 0 Yuan.
7.5.4 Other receivables actually cancelled after verification in this period
Nil
7.5.5 Other receivables collected by the borrowers of top 5 units ranked by the ending
balance
Unit: Yuan
Percentage in total Ending balance of
Ending
Unit Nature Age ending balance of other provision for bad
balance
accounts receivable debts
Sercicio de Impuestos Value-added tax
6,243,897 Within 1 years 27.30%
Internos export rebate
Lease payment in
Changyu Group 2,929,000 Within 1 years 12.80%
advance
YEDA Construction Construction
1,143,500 Over 3 years 5.00%
Industry Association guaranty money
Municipalidad de
Guaranty money 880,000 Within 1 year 3.80%
Casablanca
YEDA Finance Bureau Guaranty money 719,880 Over 3 years 3.10%
Total -- 11,916,277 -- 52.00%
7.5.6 Accounts receivable involving government subsidies
Nil
7.5.7 Other receivables that are terminated for recognition due to transfer of financial
assets
Nil
7.5.8 Other receivables transferred and then included in assets and liabilities
Nil
7.6 Inventories
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.6.1 Inventory classification
Unit: Yuan
Ending balance Beginning balance
Item Depreciation Depreciation
Book balance Book value Book balance Book value
provision provision
Raw materials 91,871,066 91,871,066 70,165,666 70,165,666
Goods in process 2,247,156,663 2,247,156,663 2,236,815,423 2,236,815,423
Commodity stocks 592,707,302 10,794,616 581,912,686 653,042,196 14,474,634 638,567,562
Total 2,931,735,031 10,794,616 2,920,940,415 2,960,023,285 14,474,634 2,945,548,651
7.6.2 Inventory depreciation provision
Unit: Yuan
Increase in this period Decrease in this period
Beginning
Item Transfer back or Ending balance
balance Accrual Other Other
write-off
Raw materials
Goods in process
Commodity stocks 14,474,634 3,680,018 10,794,616
Total 14,474,634 3,680,018 10,794,616
7.7 Other current assets
Unit: Yuan
Item Ending balance Beginning balance
Prepaid corporate income tax 27,948,958 16,087,815
Deductible input tax 190,766,318 215,812,506
Rent to be amortized 1,745,475 2,218,394
Total 220,460,751 234,118,715
7.8 Long-term equity investments
Unit: Yuan
Movements during the period Ending
Beginning balance of
Losses from Other Ending balance
Investee balance (book
Increase in Decrease investments omprehensive
Other Declare cash Accrual
(book value)
provision
value) equity dividend or provision for Others for
capital in capita under income
changing profit impairment impairment
equity-method adjustment
1. Joint ventures
SAS L&M
Holdings
42,019,654 -1,125,662 40,893,992
(“L&M
Holdings”)
Subtotal 42,019,654 -1,125,662 40,893,992
Weimeisi
(Shanghai)
Enterprise
Development 2,743,890 -479,955 2,263,935
Co., Ltd.
(“Weimeisi
Shanghai”)
Yantai Santai 3,499,963 2,193 3,502,156
Real Estate
64
2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Development
Co., Ltd.
Chengdu
Yufeng Brand
Management
518,000 -18,356 499,644
Co., Ltd.
(“Chengdu
Yufeng”)
Subtotal 6,243,853 518,000 -496,118 6,265,735
Total 48,263,507 518,000 -1,621,780 47,159,727
In October 2020, Yantai Changyu Pioneer International Limited (“Pioneer International”), a
subsidiary of the Group, signed an agreement with six institutional shareholders including
Chengdu Yukun Wine Partnership (Limited Partnership), Sichuan Xiangshanxing Technology
Co., Ltd. and Banniere BM (Shanghai) Co., Ltd. to jointly invest in the establishment of
Chengdu Yufeng Brand Management Co., Ltd. (“Chengdu Yufeng”). Pioneer International
contributes in currency RMB 518,000 Yuan, accounting for 10% of the shares of Chengdu
Yufeng. As per the Agreement and the Articles of Association, shareholders exercise their
voting rights in proportion to their capital contributions.
7.9 Investment real estate
7.9.1 Investment real estate by cost measurement method
Unit: Yuan
Houses and Construction in
Item Land use right Total
buildings progress
Ⅰ Original book value
1. Beginning balance 70,954,045 70,954,045
2. Increase in this period
2.1 Outsourcing
2.2 Transfer in from
inventories\fixed assets\
construction in progress
2.3 Business merger
increase
3. Decrease in this period
3.1 Disposal
3.2 Other transfer out
4. Ending balance 70,954,045 70,954,045
Ⅱ Accumulated
depreciation & accumulated
amortization
1. Beginning balance 43,896,315 43,896,315
2. Increase in this period 1,587,256 1,587,256
2.1 Accrual or
1,587,256 1,587,256
amortization
3. Decrease in this period
3.1 Disposal
3.2 Other transfer out
4. Ending balance 45,483,571 45,483,571
Ⅲ Impairment provision
65
2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Houses and Construction in
Item Land use right Total
buildings progress
1. Beginning balance
2. Increase in this period
2.1 Accrual
3. Decrease in this period
3.1 Disposal
3.2 Other transfer out
4. Ending balance
Ⅳ Book value
1. Ending book value 25,470,474 25,470,474
2. Beginning book value 27,057,730 27,057,730
7.10 Fixed assets
Unit: Yuan
Item Ending balance Beginning balance
Fixed assets 5,674,883,742 5,724,935,846
Disposal of fixed assets
Total 5,674,883,742 5,724,935,846
7.10.1 Particulars of fixed assets
Unit: Yuan
Houses and
Item Machinery equipment Transportation tools Total
buildings
Ⅰ Original book value:
1. Beginning balance 5,136,758,695 2,787,309,487 27,566,592 7,951,634,774
2. Increase in this period 35,695,914 63,007,012 125,621 98,828,547
2.1 Acquisition 22,526,967 60,753,925 125,621 83,406,513
2.2 Transfer in from
13,168,947 2,253,087 15,422,034
construction in progress
2.3 Business merger
increase
3. Decrease in this period 7,416,859 19,041,989 270,707 26,729,555
3.1 Disposal or
7,416,859 19,041,989 270,707 26,729,555
retirement
4. Ending balance 5,165,037,750 2,831,274,510 27,421,506 8,023,733,766
Ⅱ Accumulated
depreciation
1. Beginning balance 892,581,856 1,294,646,448 21,992,597 2,209,220,901
2. Increase in this period 66,332,617 74,456,405 947,047 141,736,069
2.1 Accrual 66,332,617 74,456,405 947,047 141,736,069
3. Decrease in this period 3,069,846 16,265,290 249,837 19,584,973
3.1 Disposal or
3,069,846 16,265,290 249,837 19,584,973
retirement
4. Ending balance 955,844,627 1,352,837,563 22,689,807 2,331,371,997
Ⅲ Impairment provision
1. Beginning balance 17,478,027 17,478,027
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Houses and
Item Machinery equipment Transportation tools Total
buildings
2. Increase in this period
2.1 Accrual
3. Decrease in this period
3.1 Disposal or
retirement
4. Ending balance 17,478,027 17,478,027
Ⅳ Book value
1. Ending book value 4,209,193,123 1,460,958,920 4,731,699 5,674,883,742
2. Beginning book value 4,244,176,839 1,475,185,012 5,573,995 5,724,935,846
As at June 30, 2021, the net value of the fixed assets with ownership restrictions was RMB
323,761,779 Yuan (December 31, 2020: RMB 333,748,819 Yuan). Please refer to Note 7.54
for details.
7.10.2 Particulars of temporarily idle fixed assets
Unit: Yuan
Original book Accumulated Depreciation
Item Book value Remarks
value depreciation reserves
Buildings 47,821,026 16,830,920 30,990,106
Machinery equipment 73,592,531 52,434,878 17,478,027 3,679,626
Other equipment 3,344,518 3,182,456 162,062
Total 124,758,075 72,448,254 17,478,027 34,831,794
7.10.3 Particulars of fixed assets under finance leases
Nil
7.10.4 Fixed assets under operating lease
Unit: Yuan
Item Ending book value
Machinery equipment 9,461
7.10.5 Particulars of fixed assets without property certificates
Unit: Yuan
Reason for not receiving the property
Item Book value
certificate
Industrial Production Center of the R&D Company 1,595,735,176 Under transaction
Dormitory Building, Main Building and Reception Building of
280,517,963 Under transaction
Chang’an Chateau
European Town, Main Building and Service Building of
173,174,563 Under transaction
Chateau AFIP
Fermentation Workshop and Wine Storage Workshop of
16,157,943 Under transaction
Xinjiang Tianzhu
Office Building and Packaging Workshop of Icewine Valley 9,231,659 Under transaction
Wine-making Workshop of Changyu (Jingyang) 5,303,366 Under transaction
Office Building, Laboratory Building and Workshop of 3,231,861 Under transaction
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Fermentation Center
Finished Goods Warehouse and Workshop of Kylin Packaging 2,170,155 Under transaction
Others 288,417 Under transaction
Total 2,085,811,103 Under transaction
7.11 Construction in progress
Unit: Yuan
Item Ending balance Beginning balance
Construction in progress 670,705,216 635,495,152
Engineering materials
Total 670,705,216 635,495,152
7.11.1 Particulars of construction in progress
Unit: Yuan
Ending balance Beginning balance
Item Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Research, Development & Manufacture
Center (“Changyu Wine City 662,298,797 662,298,797 589,010,299 589,010,299
Complex”)
Construction Project of Ningxia
438,090 438,090 420,440 420,440
Chateau
Construction Project of Chang’an
738,462 738,462
Chateau
Construction Project of Shihezi
2,420,681 2,420,681 7,626,393 7,626,393
Chateau
Construction Project of Sales Company 738,462 738,462 5,000 5,000
Construction Projects of Other
4,809,186 4,809,186 37,694,558 37,694,558
Companies
Total 670,705,216 670,705,216 635,495,152 635,495,152
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2021 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.11.2 Changes of major construction in progress in this period
Unit: Yuan
Transferred Including:
Proportion of Accumulative Capitalization
Other capitalized
Beginning Increase in to fixed decrease in Ending accumulative capitalized ratio of
Item Budget amount of Capital source
balance this period assets in this period balance project input amount of interest in this
interest in this
this period in budget interest period
period
Loans form financial
Changyu Wine City 1.2% and
4,505,780,000 589,010,299 73,288,498 662,298,797 81.60% 16,481,461 271,338 institutions and
Complex 4.3%
self-raised funds
Construction Project of
428,256,552 420,440 17,650 438,090 100% Self-raised funds
Ningxia Chateau
Construction Project of
698,120,331 7,626,393 4,930,395 12,556,788 0 100.40% Self-raised funds
Chang’an Chateau
Construction Project of
780,000,000 5,000 2,415,681 2,420,681 96.70% Self-raised funds
Shihezi Chateau
Construction Project of
164,513,550 738,462 738,462 99.60% Self-raised funds
Sales Company
Total 6,576,670,433 597,800,594 80,652,224 12,556,788 665,896,030 -- 16,481,461 271,338 --
As at June 30, 2021, there was no indication for impairment of construction in progress of the Group, so no provision for impairment was made.
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2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.12 Productive biological assets
7.12.1 Productive biological assets by cost measurement method
Unit: Yuan
Item Plantation Total
Immature Mature
Ⅰ Original book value
Beginning balance 7,607,557 248,758,101 256,365,658
Increase in this period 859,391 4,001,890 4,861,281
2.1 Outsourcing
2.2 Self cultivation 4,861,281 4,861,281
The immature turn to the mature -4,001,890 4,001,890
Decrease in this period
3.1 Disposal
3.2 Other
4. Ending balance 8,466,948 252,759,991 261,226,939
Ⅱ Accumulated depreciation
Beginning balance 64,192,122 64,192,122
Increase in this period 6,851,781 6,851,781
2.1 Accrual 6,851,781 6,851,781
Decrease in this period
3.1 Disposal
3.2 Other
4. Ending balance 71,043,903 71,043,903
Ⅲ Impairment provision
Beginning balance
Increase in this period
2.1 Accrual
Decrease in this period
3.1 Disposal
3.2 Other
4. Ending balance
Ⅳ Book value
Ending book value 8,466,948 181,716,088 190,183,036
Beginning book value 7,607,557 184,565,979 192,173,536
As at June 30, 2021, no ownership of the biological assets was restricted.
As at June 30, 2021, there was no indication for impairment of biological assets of the Group,
so no provision was made.
7.13 Right-to-use assets
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Unit: Yuan
Item Building Land Total
Ⅰ Original book value
Beginning balance 43,079,204 101,398,128 144,477,332
Increase in this period 13,042,435 13,042,435
Decrease in this period
Ending balance 56,121,639 101,398,128 157,519,767
Ⅱ Accumulated amortization
Beginning balance 7,353,773 32,468,623 39,822,396
Increase in this period 5,137,935 2,011,692 7,149,627
2.1 Accrual 5,137,935 2,011,692 7,149,627
Decrease in this period
3.1 Disposal
Ending balance 12,491,708 34,480,315 46,972,023
Ⅲ Impairment provision
Beginning balance
Increase in this period
2.1 Accrual
Decrease in this period
3.1 Disposal
Ending balance
Ⅳ Book value
1. Ending book value 43,629,931 66,917,813 110,547,744
2. Beginning book value 35,725,431 68,929,505 104,654,936
7.14 Intangible assets
7.14.1 Particulars of intangible assets
Unit: Yuan
Item Land use right Software use right Trademark Total
Ⅰ Original book value
Beginning balance 532,069,913 98,975,807 189,269,287 820,315,007
Increase in this period 1,355,331 1,355,331
2.1 Acquisition 1,355,331 1,355,331
2.2 Internal R&D
2.3 Business merger
increase
Decrease in this period
3.1 Disposal
Ending balance 532,069,913 100,331,138 189,269,287 821,670,338
Ⅱ Accumulated amortization
Beginning balance 100,498,469 44,325,044 14,502,429 159,325,942
Increase in this period 5,409,332 4,846,843 341,702 10,597,877
2.1 Accrual 5,409,332 4,846,843 341,702 10,597,877
Decrease in this period
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Item Land use right Software use right Trademark Total
3.1 Disposal
Ending balance 105,907,801 49,171,887 14,844,131 169,923,819
Ⅲ Impairment provision
Beginning balance
Increase in this period
2.1 Accrual
Decrease in this period
3.1 Disposal
Ending balance
Ⅳ Book value
1. Ending book value 426,162,112 51,159,251 174,425,156 651,746,519
2. Beginning book value 431,571,444 54,650,763 174,766,858 660,989,065
As at June 30, 2021, the net value of the intangible assets with ownership restrictions was
RMB 204,132,966 Yuan (December 31, 2020: RMB 206,920,456). Please refer to Note 7.54
for details.
7.14.2 Particulars of land use right of that not receiving the property certificate
Nil
7.15 Goodwill
7.15.1 Original book value of goodwill
Unit: Yuan
Name of the invested Increase in this period Decrease in this period
Beginning
unit or matter forming Formed by business Ending balance
balance Other Disposal Other
goodwill merger
Etablissements Roullet
Fransac (“Roullet 13,112,525 13,112,525
Fransac”)
Dicot Partners, S.L
92,391,901 92,391,901
(“Atrio Group”)
Indomita Wine
6,870,115 6,870,115
Company Chile, SpA
Kilikanoon Estate,
37,063,130 37,063,130
Australia
Total 149,437,671 149,437,671
7.15.2 Provision for impairment of goodwill
Unit: Yuan
Name of the invested Increase in this period Decrease in this period
Beginning
unit or matter forming Formed by business Ending balance
balance Other Disposal Other
goodwill merger
Etablissements Roullet
Fransac (“Roullet
Fransac”)
Dicot Partners, S.L
(“Atrio Group”)
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2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Indomita Wine
Company Chile, SpA
Kilikanoon Estate,
16,499,459 16,499,459
Australia
Total 16,499,459 16,499,459
7.16 Long-term unamortized expenses
Unit: Yuan
Increase in this Amortization in this
Item Beginning balance Other decrease Ending balance
period period
Land lease fees 42,965,977 712,443 42,253,534
Land acquisition
39,579,921 548,304 39,031,617
fees
Afforestation fees 138,185,253 4,388,818 133,796,435
Renovation costs 80,446,179 32,052,432 3,227,870 109,270,741
Other 4,913,287 4,246,622 1,378,941 7,780,968
Total 306,090,617 36,299,054 10,256,376 332,133,295
7.17 Deferred income tax assets/liabilities
7.17.1 Un-offset deferred income tax assets
Unit: Yuan
Ending Balance Beginning Balance
Item Deductible Deductible
Deferred income Deferred income
temporary temporary
tax assets tax assets
difference difference
Asset impairment provision 46,776,197 10,356,331 44,279,268 9,732,098
Unrealized profits from inter-company
212,321,254 53,080,313 313,043,226 78,260,807
transactions
Deductible loss 305,592,163 75,332,385 268,074,301 65,844,999
Unpaid bonus 114,040,653 28,510,163 147,824,610 36,956,152
Dismission welfare 13,397,290 3,349,323 16,274,352 4,068,588
Deferred income 45,454,376 9,826,084 52,653,609 11,378,631
Others 4,097,837 1,024,460 4,097,837 958,125
Total 741,679,770 181,479,059 846,247,203 207,199,400
7.17.2 Un-offset deferred income tax liabilities
Unit: Yuan
Ending Balance Beginning Balance
Item Taxable Taxable
Deferred income Deferred income
temporary temporary
tax liabilities tax liabilities
difference difference
Assets appraisal appreciation in business merger
37,134,158 11,635,114 49,156,771 12,022,613
under non-common control
Others 953,124 238,281 953,124 238,281
Total 38,087,282 11,873,395 50,109,895 12,260,894
7.17.3 Details of unconfirmed deferred income tax assets
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2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Unit: Yuan
Item Ending balance Beginning balance
Deductable temporary difference
Deductible loss 221,743,602 187,130,828
Total 221,743,602 187,130,828
7.17.4 Deductible losses of unconfirmed deferred income tax assets will expire in:
Unit: Yuan
Year Ending sum Beginning sum Remark
2021 25,008,263 25,008,263
2022 21,367,869 21,367,869
2023 22,801,737 22,801,737
2024 42,088,453 42,088,453
2025 75,864,506 75,864,506
2026 34,612,774
Total 221,743,602 187,130,828 --
7.18 Other non-current assets
Unit: Yuan
Ending balance Beginning balance
Item Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Royalty 158,377,754 158,377,754 170,370,147 170,370,147
Total 158,377,754 158,377,754 170,370,147 170,370,147
7.19 Short-term loans
7.19.1 Classification of short-term loans
Unit: Yuan
Item Ending balance Beginning balance
Pledge loan
Mortgage loan 115,493,615 55,724,891
Guaranteed loan 22,112,812 14,215,916
Fiduciary loan 578,755,253 619,149,908
Total 716,361,680 689,090,715
As at June 30, 2021, EUR mortgaged loan was Hacienday Viedos Marques del Atrio, S.L.U
(“Atrio”) factoring of accounts receivable from banks including Banco de Sabadell, S.A. of
EUR 5,756,539 (equivalent of RMB 44,245,910 Yuan) (December 31, 2020: RMB
28,557,993 Yuan).
As at June 30, 2021, USD mortgaged loan was Chile Indomita Wine Group mortgaged USD
11,125,000 (equivalent of RMB 71,247,705 Yuan) of its fixed assets to Banco Scotiabank
(December 31, 2020: RMB 26,162,960 Yuan).
On June 30, 2021, AUD guaranteed loan was Australia Kilikanoon Estate has borrowed from
ANZ Bank AUD 4,556,712 (equivalent of RMB 22,112,812 Yuan) (December 31, 2020:
RMB 14,215,916 Yuan), and it is guaranteed by this Company.
7.20 Accounts payable
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2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.20.1 List of accounts payable
Unit: Yuan
Item Ending balance Beginning balance
Accounts payable for materials, etc. 409,887,533 479,305,382
Total 409,887,533 479,305,382
7.20.2 Explanation of significant accounts payable aged more than one year
As at June 30, 2021, there were no significant accounts payable aged more than one year.
7.21 Contract liabilities
Unit: Yuan
Item Ending balance Beginning balance
Advances from customers 108,304,501 118,210,799
Withholding of goods with sales rebate 16,862,481
Total 108,304,501 135,073,280
7.22 Employee remunerations payable
7.22.1 List of employee remunerations payable
Unit: Yuan
Increase in this Decrease in this
Item Beginning balance Ending balance
period period
1. Short-term remuneration 172,176,085 184,482,600 230,765,275 125,893,410
2. Post-employment welfare – defined
329,474 22,026,390 22,258,334 97,530
contribution plan
3. Dismission welfare 16,274,352 3,831,246 6,708,308 13,397,290
4.Other welfare due within one year
Total 188,779,911 210,340,236 259,731,917 139,388,230
7.22.2 List of short-term remunerations
Unit: Yuan
Increase in this Decrease in this
Item Beginning balance Ending balance
period period
1. Salaries, bonuses, allowances and
170,277,311 159,884,889 206,177,612 123,984,588
subsidies
2. Staff welfare 1,734,723 9,520,020 9,179,045 2,075,698
3. Social insurance charges 340,733 6,938,923 7,271,571 8,085
Including: Medical insurance 340,733 6,159,617 6,492,265 8,085
Injury insurance 772,799 772,799
Maternity insurance 6,507 6,507
4. Housing fund 27,497 6,547,794 6,541,143 34,148
5. Union fee and staff education fee 1,874,792 1,590,974 1,595,904 1,869,862
6. Short-term compensated absences
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2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Increase in this Decrease in this
Item Beginning balance Ending balance
period period
7. Short-term profit-sharing plan
Minus: Those divided into non-current
2,078,971 2,078,971
liabilities
Total 172,176,085 184,482,600 230,765,275 125,893,410
7.22.3 List of defined contribution plan
Unit: Yuan
Item Beginning balance Increase Decrease Ending balance
1. Basic endowment insurance 329,464 21,461,355 21,693,299 97,520
2. Unemployment insurance 10 565,035 565,035 10
3. Enterprise annuity payment
Total 329,474 22,026,390 22,258,334 97,530
7.22.4 Dismission welfare
Unit: Yuan
Item Beginning balance Increase Decrease Ending balance
1. Compensation for server of labor
relation
2. Compensation for early retirement 16,274,352 3,831,246 6,708,308 13,397,290
Total 16,274,352 3,831,246 6,708,308 13,397,290
7.23 Taxes and dues payable
Unit: Yuan
Item Ending balance Beginning balance
Value added tax 13,683,762 25,853,102
Consumption tax 7,730,930 42,076,231
Corporate income tax 129,991,906 130,621,524
Individual income tax 329,670 614,344
Urban maintenance and construction tax 1,407,055 3,429,038
Education surcharges 1,043,473 2,498,374
Urban land use tax 2,271,394 2,327,666
Other 4,742,390 5,992,534
Total 161,200,580 213,412,813
7.24 Other payables
Unit: Yuan
Item Ending balance Beginning balance
Interest payable 2,289,564 553,471
Dividends payable 274,507,652 1,003,125
Other payables 406,265,258 384,548,930
Total 683,062,474 386,105,526
7.24.1 Interest payable
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2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Unit: Yuan
Item Ending balance Beginning balance
Interest of long-term loans with interest paid by
installment and principal paid on maturity
Interest of corporate bonds
Interest payable of short-term loans 2,289,564 553,471
Interest of preferred shares\ perpetual bonds
divided into financial liabilities
Other
Total 2,289,564 553,471
7.24.2 Dividends payable
Unit: Yuan
Item Ending balance Beginning balance
Ordinary stock dividends 274,185,600
Preferred stock dividends/sustainable debt dividends
divided into equity instruments
Other 322,052 1,003,125
Total 274,507,652 1,003,125
7.24.3 Other payables
7.24.3.1 Other payables listed by nature
Unit: Yuan
Item Ending balance Beginning balance
Dealer’s deposit payable 228,020,107 177,129,582
Equipment purchase and construction costs
41,353,043 51,381,563
payable
Transportation charges payable 2,385,516 26,061,359
Advertisement expenses payable 54,224,614 50,444,091
Employee cash deposit 359,282 359,282
Supplier’s deposit payable 13,526,594 14,836,302
Contracting fees payable 4,280,818 9,656,066
Other 62,115,284 54,680,685
Total 406,265,258 384,548,930
7.25 Non-current liabilities due within one year
Unit: Yuan
Item Ending balance Beginning balance
Long-term loans due within one year 94,001,441 111,311,890
Bonds payable due within one year
Long-term accounts payable due within
22,000,000 22,000,000
one year
Lease liabilities due within one year 9,278,250 8,185,246
Total 125,279,691 141,497,136
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2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.26 Other current liabilities
Item Ending balance Beginning balance
Unamortized VAT amount 14,000,154 14,820,653
Total 14,000,154 14,820,653
7.27 Long-term loans
7.27.1 Classification of long-term loans
Unit: Yuan
Item Ending balance Beginning balance
Pledged loan
Mortgage loan
Guaranteed loan 76,983,600 91,445,600
Fiduciary loan 219,759,687 220,219,258
Less: Long-term loans due within one year 94,001,441 111,311,890
Total 202,741,846 200,352,968
As at June 30, 2021, fiduciary loans (EUR) were EUR 28,591,461 borrowed by Atrio from
Banco Sabadell, Bankia, Banco Santander, BBVA and Caja Rural de Navarr etc. (equivalent
of RMB 219,759,687 Yuan) (December 31, 2020: RMB 220,219,258 Yuan). Guaranteed
loans (RMB) were long-term borrowings of RMB 18,750,000 Yuan of the R&D and
Manafacturing Company, a subsidiary of the Company (December 31, 2020: RMB
31,250,000 Yuan). Guaranteed loans (AUD) were Australia Kilikanoon Estate has borrowed
AUD 12,000,000 (equivalent of RMB 58,233,600 Yuan) (December 31, 2020: RMB
60,195,600 Yuan) from ANZ Bank and it is guaranteed by this Company.
7.28 Lease Liabilities
Unit: Yuan
Item Ending balance Beginning balance
Building 45,722,898 36,248,053
Land 74,892,684 76,426,487
Less: Lease liabilities due within one year 9,278,250 8,185,246
Total 111,337,332 104,489,294
7.29 Long-term accounts payable
Unit: Yuan
Item Ending balance Beginning balance
Long-term accounts payable 64,000,000 86,000,000
Special accounts payable
Total 64,000,000 86,000,000
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7.29.1 Long-term accounts payable listed by nature
Unit: Yuan
Item Ending balance Beginning balance
Agricultural Development Fund of China (“CADF”) 86,000,000 108,000,000
Less: Long-term payables due within one year 22,000,000 22,000,000
Balance of long-term payables 64,000,000 86,000,000
In 2016, Agricultural Development Fund invested RMB 305,000,000 Yuan in the Research,
Development & Manufacture Company, accounting for 37.9% of the registered capital.
According to the investment agreement, it is agreed that Agricultural Development Fund will
take back the investment fund in ten years and obtain fixed income according to year, which
is 1.2% of the remaining principal. Except for the above fixed income, the Agricultural
Development Fund shall not enjoy other profits of the Research, Development & Manufacture
Company or bear the losses of the Research, Development & Manufacture Company.
Accordingly, the investment of the Agricultural Development Fund in the Research,
Development & Manufacture Company is equity investment nominally, which is debt
investment (finance discount interest loan) in deed. The Group included the investment of the
Agricultural Development Fund in long-term accounts payable measured by amortized cost.
From January to June 2021, the Group gave back the principal of RMB 24,000,000 Yuan.
Refer to Note 7.54 for details of mortgaged and pledged assets.
7.30 Deferred income
Unit: Yuan
Increase in this Decrease in this
Item Beginning balance Ending balance Forming reason
period period
Governmental
52,653,609 7,199,234 45,454,375
subsidy
Total 52,653,609 7,199,234 45,454,375 --
Projects related to governmental subsidy
Unit: Yuan
Amount
of Amount Amount
Amount
subsidy included in included in
Beginning offset Other Ending Related to
Item of liabilities newly non-operating other
balance the cost changes balance assets/income
increased revenue in income in
expenses
in this this period this period
period
Industrial development
24,600,000 2,050,000 22,550,000 Related to assets
support project
Xinjiang industrial
revitalisation and
12,798,000 711,000 12,087,000 Related to assets
technological
transformation project
Fixed asset investment
reward of Shihezi 2,436,600 1,140,000 1,296,600 Related to assets
Chateau project
Shandong Peninsula
Blue Economic Area 2,000,000 1,000,000 1,000,000 Related to assets
construction funds
Special government
2,120,000 530,000 1,590,000 Related to assets
grant for infrastructure
Raw wine fermentation 434,700 434,700 Related to assets
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Amount
of Amount Amount
Amount
subsidy included in included in
Beginning offset Other Ending Related to
Item of liabilities newly non-operating other
balance the cost changes balance assets/income
increased revenue in income in
expenses
in this this period this period
period
project
Wine fermentation
capacity construction 2,400,000 200,000 2,200,000 Related to assets
(Huanren) project
Engineering
technology
transformation of 1,740,000 290,000 1,450,000 Related to assets
information system
project
Liquor electronic
1,191,150 333,527 857,623 Related to assets
tracking project
Special fund for
efficient water-saving 1,315,000 81,000 1,234,000 Related to assets
irrigation project
Subsidy for economic
and energy-saving
769,800 64,150 705,650 Related to assets
technological
transformation projects
Wine industry
186,000 93,000 93,000 Related to assets
development project
Subsidy for mechanic
development of
238,858 13,270 225,588 Related to assets
Penglai Daliuhang
Base
Cross-border Related to
201,801 126,887 74,914
e-commerce project income
Subsidy for boiler
Related to
reconstruction and 70,000 5,000 65,000
income
demolition
Prize for Yantai
Related to
Mayor’s Cup Industrial 50,000 25,000 25,000
income
Design Competition
Special fund for 2020
Related to
Yantai City Innovation 101,700 101,700
income
Driven Development
Total 52,653,609 7,199,234 45,454,375
7.31 Other non-current liabilities
Unit: Yuan
Item Ending balance Beginning balance
Employee remunerations payable 2,078,971 2,078,971
Total 2,078,971 2,078,971
As at June 30, 2021, the employee remunerations payable referred to the job security deposit
deducted from the year-end bonus of the employees higher than sales manager of the Group
in proportion, which will be paid from 2021 to 2023 as predicted.
7.32 Share capital
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Unit: Yuan
Increase or decrease (+,-) in this period
Beginning Ending
balance Newly issued Allocated Share transferred from balance
Other Subtotal
shares shares accumulation fund
Total shares 685,464,000 685,464,000
7.33 Capital reserves
Unit: Yuan
Decrease in this
Item Beginning balance Increase in this period Ending balance
period
Capital premium (Share
519,052,172 519,052,172
capital premium)
Other capital reserves 5,916,588 5,916,588
Total 524,968,760 524,968,760
7.34 Other comprehensive income
Unit: Yuan
Amount incurred in this period
Minus: Minus:
amount amount
Amount included in included in
Beginning incurred other other Minus: Attributable Attributable Ending
Item before comprehensive comprehensive income to parent to minority
balance balance
income tax income before income before tax company shareholders
in this and transferred and transferred expenses after tax after tax
period to profit or to retained
loss in this earnings in
period this period
1. Other
comprehensive
income not to be
reclassified into
profit and loss later
Including: Changes
after remeasuring
and resetting the
benefit plans
Other
comprehensive
income not to be
reclassified into
profit and loss under
equity law
Changes in
the fair value of
other investments in
equity instruments
Changes in
the fair value of the
enterprise's own
credit risk
2. Other
comprehensive
income to be 576,129 -24,776,238 -21,618,495 -3,157,743 -21,042,366
reclassified into
profit and loss later
Including: Other
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Amount incurred in this period
Minus: Minus:
amount amount
Amount included in included in
Beginning incurred other other Minus: Attributable Attributable Ending
Item before comprehensive comprehensive income to parent to minority
balance balance
income tax income before income before tax company shareholders
in this and transferred and transferred expenses after tax after tax
period to profit or to retained
loss in this earnings in
period this period
comprehensive
income to be
reclassified into
profit and loss under
equity law
Changes in
the fair value of
other debt
investments
Amount of
financial assets
reclassified into
other comprehensive
income
Provision for
credit impairment of
other credit
investments
Provision for
cash-flow hedge
Difference in
translation of
576,129 -24,776,238 -21,618,495 -3,157,743 -21,042,366
Foreign Currency
Financial Statement
Total other
comprehensive 576,129 -24,776,238 -21,618,495 -3,157,743 -21,042,366
income
7.35 Surplus reserves
Unit: Yuan
Decrease in this
Item Beginning balance Increase in this period Ending balance
period
Legal surplus reserves 342,732,000 342,732,000
Free surplus reserves
Reserve fund
Enterprise expansion fund
Other
Total 342,732,000 342,732,000
7.36 Undistributed profit
Unit: Yuan
Item Ending balance Beginning balance
Undistributed profit at the end of prior period before adjustment 8,714,091,755 8,735,513,044
Total Undistributed profit at the beginning of the period before adjustment -10,632,422
82
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
(increase listed with+ , and decrease listed with -)
Undistributed profit at the beginning of the period after adjustment 8,703,459,333 8,735,513,044
Plus: Net profit for owner of the parent company 371,821,819 470,860,587
Minus: Drawn legal surplus
Drawn free surplus
Drawn common risk provision
Common dividend payable 274,185,600 492,281,876
Common dividend transferred to share capital
Undistributed profit at the end of period 8,801,095,552 8,714,091,755
As a result of the implementation of the new lease standard by the Group in 2021, the
undistributed profit at the beginning of 2021 was reduced by RMB 10,632,422 Yuan.
7.37 Operating income and operating cost
Unit: Yuan
Amount incurred in this period Amount incurred in prior period
Item
Income Cost Income Cost
Main business 1,841,427,492 753,630,446 1,395,214,715 567,783,470
Other business 33,032,945 7,883,098 23,333,832 7,074,869
Total 1,874,460,437 761,513,544 1,418,548,547 574,858,339
7.37.1 Details of operating income
Unit: Yuan
Amount incurred in this period
Item
Income Cost
Main business 1,841,427,492 753,630,446
Other business 33,032,945 7,883,098
Total 1,874,460,437 761,513,544
Including: Income from contracts 1,873,414,304 760,879,897
Income from house rents 1,046,133 633,647
7.37.2 Situation of income from contracts
Unit: Yuan
Contract classification Amount incurred in this period
Type of merchandise
Alcoholic beverage 1,841,427,492
Others 31,986,812
Classified by the time of merchandise transfer
Revenue recognized at a point in time 1,873,414,304
7.38 Taxes and surcharges
Unit: Yuan
83
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Amount incurred in this period Amount incurred in prior period
Consumption tax 58,366,205 49,392,779
Urban maintenance and construction tax 11,929,833 9,447,918
Education surcharges 8,695,431 6,850,290
Building tax 13,513,343 14,066,376
Land use tax 5,585,762 5,870,612
Stamp duty 1,806,604 2,293,353
Other 322,839 522,494
Total 100,220,017 88,443,822
7.39 Selling expenses
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Salary and welfare expenses 129,002,823 99,508,170
Marketing expenses 108,808,265 56,163,925
Labor expenses 16,356,442 5,717,581
Depreciation expenses 29,724,959 26,350,204
Storage and lease expenses 13,455,458 18,435,218
Advertisement expenses 19,485,798 9,212,729
Trademark use fees 11,313,578 8,953,500
Travel expenses 9,275,034 8,368,347
Design & production expenses 9,396,703 1,595,262
Conference expenses 6,652,432 2,447,005
Water, electricity and gas charges 4,969,919 4,491,631
Other 29,944,199 11,668,632
Total 388,385,610 252,912,204
7.40 Management expenses
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Employee remunerations 32,695,621 27,711,146
Depreciation expenses 38,197,467 36,815,081
Contracting expenses 3,852,345 6,687,337
Repair expenses 6,025,536 4,750,072
Office expenses 6,964,669 5,617,017
Amortization expenses 9,827,020 10,475,529
Afforestation fees 6,759,616 6,910,323
Safe production costs 5,159,685 2,506,681
Rental expenses 2,789,523 4,659,247
Business entertainment expenses 1,938,253 1,480,213
Public security & clean-keeping
3,339,145 2,957,475
expenses
Travel expenses 675,373 424,412
Other 5,160,376 2,075,336
Total 123,384,629 113,069,869
84
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.41 R&D expenses
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
R&D expenses 2,477,835 1,805,988
Total 2,477,835 1,805,988
7.42 Financial expenses
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Interest expenditure 14,239,535 14,891,310
Minus: Interest income 5,827,243 6,146,409
Plus: Commission charges 1,020,633 2,216,930
Exchange gain or loss -69,893 975,571
Total 9,363,032 11,937,402
7.43 Other income
Unit: Yuan
Source of other income Amount incurred in this period Amount incurred in prior period
Supporting fund for industrial development 2,050,000 2,050,000
Reward for investment in fixed assets 1,140,000 1,140,000
Special fund for construction of peninsula blue economic
1,000,000 1,000,000
zone
Other – related to assets 2,750,646 3,497,505
Special fund for supporting corporate development 14,283,100 38,279,579
Other – related to income 754,949 4,813,147
Total 21,978,695 50,780,231
7.44 Investment income
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Investment income from long-term equity by equity
-1,621,780 -1,170,685
method
Investment income from disposal of long-term equity
Investment income gained from trading financial assets
during the holding period
Investment income gained from disposal of trading
financial assets
Dividend income gained from other equity instruments
during the holding period
Gains generated from the remaining equity remeasured as
per fair value after the loss of control
Interest income gained from equity inverstment during the
holding period
Interest income gained from other equity inverstments
during the holding period
Investment income gained from disposal of other equity
inverstments
Total -1,621,780 -1,170,685
85
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.45 Loss on impairment of credit
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Loss on bad debts of accounts receivable -6,176,948 -533,145
Total -6,176,948 -533,145
7.46 Loss on impairment of assets
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
1. Loss on bad debts
2. Inventory falling price loss and loss on
3,680,018 4,242,813
impairment of contrct execution cost
3. Loss on impairment of long-term equity
investment
4. Loss on impairment of investment real estate
5. Loss on impairment of fixed assets
6. Loss on impairment of engineering materials
7. Loss on impairment of construction in progress
8. Loss on impairment of productive biological
assets
9. Loss on impairment of oil and gas assets
10. Loss on impairment of intangible assets
11. Loss on impairment of goodwill
12. Loss on impairment of contract assets
13. Other
Total 3,680,018 4,242,813
7.47 Income from asset disposal
Unit: Yuan
Source of income from asset disposal Amount incurred in this period Amount incurred in prior period
Income from disposal of fixed assets 24,148
Total 24,148
7.48 Non-operating income
Unit: Yuan
Amount incurred in Amount incurred in Amount included in the current
Item
this period prior period non-recurring profits/losses
Gains on debt recombination
Gains on exchange of non-monetary
assets
Grains on donations
Governmental subsidy
Gains on breakage and scrap of
364 364
non-current assets
Others 2,488,414 6,686,519 2,488,414
Total 2,488,778 6,686,519 2,488,778
86
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
7.49 Non-operating expenses
Unit: Yuan
Amount incurred in Amount incurred in Amount included in the current
Item
this period prior period non-recurring profits/losses
Loss on debt recombination
Loss on exchange of
non-monetary assets
Donation 500,000
Loss on breakage and scrap of
45,482 45,482
non-current assets
Fine, penalty and overdue fine
paid due to violation of laws and 152,960 31,123 152,960
administrative regulations
Others 371,279 495,351 371,279
Total 569,721 1,026,474 569,721
7.50 Income tax expenses
7.50.1 List of income tax expenses
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior
period
Current income tax expenses 111,247,007 63,239,625
Deferred income tax expenses 25,332,842 50,214,323
Total 136,579,849 113,453,948
7.50.2 Adjustment process of accounting profit and income tax expenses
Unit: Yuan
Item Amount incurred in this period
Total profit 508,894,812
Income tax expenses calculated according to the legal/applicable tax rate 127,223,703
Influence of different tax rates applicable to subsidiary -1,400,313
Influence of income tax in the term before adjustment 647,740
Influence of nontaxable income
Influence of non-deductible costs, expenses and losses 1,662,644
Influence of deductible loss from use of unconfirmed deferred income tax assets in prior -207,119
period of deductible temporary difference or deductible loss of unconfirmed deferred
Influence 8,653,194
income tax assets in this period
Income tax expense 136,579,849
7.51 Other comprehensive income
Refer to Note 7.34 for details.
7.52 Items of cash flow statement
7.52.1 Other cash received related to operating activities
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Governmental subsidy income 14,779,461 40,851,851
87
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Amount incurred in this period Amount incurred in prior period
Interest income 4,075,142 3,923,939
Net amercement income 71,929 269,694
Other 7,335,490 2,722,718
Total 26,262,022 47,768,202
7.52.2 Other cash paid related to operating activities
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Selling expenses 218,063,727 210,590,989
Administrative expenses 41,685,752 37,212,155
Other 6,620,058 4,024,128
Total 266,369,537 251,827,272
7.52.3 Other cash received related to financing activities
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Interest income from pledged time deposits by
1,654,861
R&D Company
Time deposits pledged by R&D Company for
20,000,000
long-term loans
Total 21,654,861
7.52.4 Other cash paid related to financing activities
Unit: Yuan
Item Amount incurred in this period Amount incurred in prior period
Cash paid to repay the principal and interest of
7,144,318
the lease liability
Total 7,144,318
7.53 Supplementary information to cash flow statement
7.53.1 Supplementary information to cash flow statement
Unit: Yuan
Supplementary materials Amount incurred in this period Amount incurred in prior period
1. Cash flows from operating activities calculated
-- --
by adjusting the net profit:
Net profit 372,314,963 321,070,382
Plus: Provision for impairment of assets 2,496,930 -3,709,668
Depreciation of fixed assets, oil-and-gas assets
150,175,106 143,934,894
and productive biological assets
Depreciation of right-of-use assets 7,149,627
Amortization of intangible assets 10,597,877 11,171,783
Amortization of long-term deferred expenses 10,256,376 7,822,994
Losses on disposal of fixed assets, intangible
assets and other long-term assets (profit listed -39,641
with “－”)
88
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Supplementary materials Amount incurred in this period Amount incurred in prior period
Losses on retirement of fixed assets (profit listed 45,118 157,985
with “－”)
Losses on fair value change (profit listed with
“－”)
Financial costs (profit listed with “－”) 12,767,220 13,316,860
Investment losses (profit listed with “－”) 1,621,780 1,170,685
Decrease in deferred income tax assets (increase 25,720,341 50,602,610
listed with “-”)
Increase of deferred income tax liabilities -387,499 -388,287
(decrease listed with “－”)
Decrease in inventories (increase listed with “-”) 28,288,254 -41,362,368
Decrease in operating receivables (increase listed 9,205,099 196,861,272
with “-”)
Increase in operating payable (decrease listed with -174,316,043 -717,128,253
“-”)
Other
Net cash flows from operating activities 455,935,149 -16,518,752
2. Significant investment and financing activities -- --
not involving cash deposit and withdrawal:
Debt transferred into assets
Convertible corporate bond due within 1 year
Fixed assets under financing lease
3. Net changes of cash and cash equivalent: -- --
Ending balance of cash 1,392,384,794 1,333,387,007
Minus: Beginning balance of cash 1,052,665,105 1,397,399,469
Plus: Ending balance of cash equivalent
Minus: Beginning balance of cash equivalent
Net increase amount of cash and cash equivalent 339,719,689 -64,012,462
7.53.2 Composition of cash and cash equivalents
Unit: Yuan
Item Ending balance Beginning balance
1. Cash 1,392,384,794 1,052,665,105
Including: Cash on hand 32,865 19,637
Bank deposits on demand 1,392,351,929 1,052,645,468
Other monetary capital on demand
Due from central bank available for payment
Due from the industry
Inter-bank lending
2. Cash equivalents
Including: Bond investment due within three months
3. Balance of cash and cash equivalents at the end of
1,392,384,794 1,052,665,105
period
Including: Restricted use of parent company or
subsidiaries in the group
7.54 Assets with ownership or use right restrictions
89
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Unit: Yuan
Item Ending book value Reason for restriction
47,793,184 L/C deposit, frozen balance of Alipay, housing fund
Monetary capital
and guaranty money for deposit in unit card
Accounts receivable 44,245,910 Pledge of short-term loans
323,761,779 Pledge of short-term loans, long-term loans and
Fixed assets
long-term accounts payable
Intangible assets 204,132,966 Pledge of long-term accounts payable
Total 619,933,839 --
7.55 Monetary items of foreign currency
7.55.1 Monetary items of foreign currency
Ending balance at foreign Ending balance at RMB
Item Converted exchange rate
currency equivalent
Monetary capital -- -- 22,907,583
Including: USD 2,782,429 6.4601 17,974,767
EUR 641,776 7.6862 4,932,816
HKD
Accounts receivable -- -- 42,053,884
Including: USD 4,881,079 6.4601 31,532,258
EUR 854,020 7.6862 6,564,169
CAD 42,789 5.2097 222,918
GBP 417,687 8.9410 3,734,539
Short-term borrowing -- -- 100,874,462
Including: USD 15,615,000 6.4601 100,874,462
EUR
HKD
7.55.2 The Company’s overseas subsidiaries determine their functional currency based on the
currency in the main economic environment in which they operate. The functional currency of
Atrio and Francs Champs Participations SAS ("Farshang Holdings") is Euro, the functional
currency of Chile Indomita Wine Group is Chilean Peso, and the functional currency of
Australia Kilikanoon Estate is Australian Dollar.
8. Changes in scope of consolidation
Actual
Foundation Nature of Registered
Full name of investing unit Equity acquisition mode contribution
date business capital
amount
Tianjin Changyu Yixin Acquired by establishment January 22, Sales RMB 10 5,100,000
Digital Technology Co., Ltd. or investment 2021 Million Yuan
Shanghai Changyu Guoqu Acquired by establishment March 30, Sales RMB 6 3,060,000
Digital Technology Co., Ltd. or investment 2021 Million Yuan
Yantai Christon Catering Co., Acquired by establishment March 23, Catering RMB 1
Ltd. or investment 2021 industry Million Yuan
90
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
9. Equity in other entities
9.1 Equity in the subsidiaries
9.1.1 Constitution of enterprise group
Proportion of
Principal business Business shareholding
Name of subsidiary Registration place Acquisition mode
location nature
Direct Indirect
Acquired from a
Xinjiang Tianzhu Wine
Shihezi, Xinjiang, Shihezi, Xinjiang, business combination
Co., Ltd. (“Xinajing Manufacturing 60%
China China under non-common
Tianzhu”)
control
Acquired from a
Etablissements Roullet
business combination
Fransac (“Roullet Cognac, France Cognac, France Trading 100%
under non-common
Fransac”)
control
Acquired from a
Dicot Partners, S.L business combination
Navarre, Spain Navarre, Spain Sales 90%
(“Dicot”) under non-common
control
Via Indómita,S.A.,Via
Dos Andes,S.A., and Acquired by
Bodegas Santa Alicia SpA. Santiago, Chile Santiago, Chile Sales 85% establishment or
(“Chile Indomita Wine investment
Group”)
Acquired from a
Kilikanoon Estate Pty Ltd
Adelaide, Adelaide, business combination
(“Australia Kilikanoon Sales 97.50%
Australia Australia under non-common
Estate”)
control
Beijing Changyu Sales and Acquired by
Distribution Co., Ltd. Beijing, China Beijing, China Sales 100% establishment or
(“Beijing Sales”) investment
Yantai Kylin Packaging Acquired by
Yantai, Shandong, Yantai, Shandong,
Co., Ltd. (“Kylin Manufacturing 100% establishment or
China China
Packaging”) investment
Yantai Chateau Acquired by
Yantai, Shandong, Yantai, Shandong,
Changyu-Castel Co., Ltd. Manufacturing 70% establishment or
China China
(“Chateau Changyu”) (b) investment
Changyu (Jingyang) Wine Acquired by
Xianyang, Xianyang,
Co., Ltd. (“Jingyang Manufacturing 90% 10% establishment or
Shaanxi, China Shaanxi, China
Wine”) investment
Yantai Changyu Pioneer Acquired by
Yantai, Shandong, Yantai, Shandong,
Wine Sales Co., Ltd. Sales 100% establishment or
China China
(“Sales Company”) investment
Langfang Development
Acquired by
Zone Castel-Changyu Langfang, Hebei, Langfang, Hebei,
Manufacturing 39% 10% establishment or
Wine Co., Ltd. (“Langfang China China
investment
Castel”)
Changyu (Jingyang) Wine Acquired by
Xianyang, Xianyang,
Sales Co., Ltd. (“Jingyang Sales 10% 90% establishment or
Shaanxi, China Shaanxi, China
Sales”) investment
Langfang Changyu Acquired by
Langfang, Hebei, Langfang, Hebei,
Pioneer Wine Sales Co., Sales 10% 90% establishment or
China China
Ltd. (“Langfang Sales”) investment
Shanghai Changyu Sales Shanghai, China Shanghai, China Sales 100% Acquired by
and Distribution Co., Ltd. establishment or
91
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Proportion of
Principal business Business shareholding
Name of subsidiary Registration place Acquisition mode
location nature
Direct Indirect
(“Shanghai Sales”) investment
Beijing Changyu AFIP
Acquired by
Agriculture development Miyun, Beijing, Miyun, Beijing,
Sales 100% establishment or
Co., Ltd. (“Agriculture China China
investment
Development”)
Beijing Chateau Changyu Acquired by
AFIP Global Co., Ltd. Beijing, China Beijing, China Manufacturing 91.53% establishment or
(“AFIP”) (c) investment
Yantai Changyu Wine Acquired by
Yantai, Shandong, Yantai, Shandong,
Sales Co., Ltd. (“Wines Sales 90% 10% establishment or
China China
Sales”) investment
Yantai Changyu Pioneer Acquired by
Yantai, Shandong, Yantai, Shandong,
International Co., Ltd. Sales 70% 30% establishment or
China China
(“Pioneer International”) investment
Hangzhou Changyu Wine Acquired by
Hangzhou, Hangzhou,
Sales Co., Ltd. Sales 100% establishment or
Zhejiang, China Zhejiang, China
(“Hangzhou Changyu”) investment
Ningxia Changyu Grape Acquired by
Yinchuan,
Growing Co., Ltd. Ningxia, China Planting 100% establishment or
Ningxia, China
(“Ningxia Growing”) investment
Huanren Changyu Acquired by
Benxi, Liaoning, Benxi, Liaoning,
National Wines Sales Co., Sales 100% establishment or
China China
Ltd. (“National Wines”) investment
Liaoning Changyu Golden
Acquired by
Icewine Valley Co., Ltd. Benxi, Liaoning, Benxi, Liaoning,
Manufacturing 51% establishment or
(“Golden Icewine Valley”) China China
investment
(d)
Yantai Development Zone
Acquired by
Changyu Trading Co., Ltd. Yantai, Shandong, Yantai, Shandong,
Sales 100% establishment or
(“Development Zone China China
investment
Trading”)
Yantai Changyu Fushan Acquired by
Yantai, Shandong, Yantai, Shandong,
Trading Company Sales 100% establishment or
China China
(“Fushan Trading”) investment
Acquired by
Beijing AFIP Meeting Miyun, Beijing, Miyun, Beijing,
Services 100% establishment or
Center (“Meeting Center”) China China
investment
Acquired by
Beijing AFIP Tourism and Miyun, Beijing, Miyun, Beijing,
Tourism 100% establishment or
Culture (“AFIP Tourism”) China China
investment
Changyu (Ningxia) Wine Acquired by
Co., Ltd. (“Ningxia Ningxia, China Ningxia, China Manufacturing 100% establishment or
Wine”) investment
Yantai Changyu Chateau Acquired by
Yantai, Shandong, Yantai, Shandong, Wholesale and
Tinlot Co., Ltd. (“Chateau 65% 35% establishment or
China China retail
Tinlot”) investment
Xinjiang Chateau
Acquired by
Changyu Baron Balboa Shihezi, Xinjiang, Shihezi, Xinjiang,
Manufacturing 100% establishment or
Co., Ltd. (“Chateau China China
investment
Shihezi”)
Ningxia Chateau Changyu Acquired by
Yinchuan, Yinchuan,
Moser XV Co., Ltd. Manufacturing 100% establishment or
Ningxia, China Ningxia, China
(“Chateau Ningxia”) investment
Shaanxi Chateau Changyu Xianyang, Xianyang,
Manufacturing 100% Acquired by
Rena Co., Ltd. (“Chateau Shaanxi, China Shaanxi, China establishment or
92
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Proportion of
Principal business Business shareholding
Name of subsidiary Registration place Acquisition mode
location nature
Direct Indirect
Chang’an”) investment
Yantai Changyu Wine
Acquired by
Research & Development Yantai, Shandong, Yantai, Shandong,
Manufacturing 85.32% establishment or
Centre Co., Ltd. (“R&D China China
investment
Centre”) (e)
Changyu (HuanRen) Wine Acquired by
Benxi, Liaoning, Benxi, Liaoning, Wine-making
Co., Ltd. (“Huan Ren 100% establishment or
China China project
Wine”) investment
Xinjiang Changyu Sales Acquired by
Shihezi, Xinjiang, Shihezi, Xinjiang,
Co., Ltd. (“Xinjiang Sales 100% establishment or
China China
Sales”) investment
Ningxia Changyu Trading Acquired by
Yinchuan, Yinchuan,
Co., Ltd. (“Ningxia Sales 100% establishment or
Ningxia, China Ningxia, China
Trading”) investment
Shaanxi Changyu Rena Acquired by
Xianyang, Xianyang,
Wine Sales Co., Ltd. Sales 100% establishment or
Shaanxi, China Shaanxi, China
(“Shaanxi Sales”) investment
Penglai Changyu Wine Acquired by
Penglai, Penglai,
Sales Co., Ltd. (“Penglai Sales 100% establishment or
Shandong, China Shandong, China
Wine”) investment
Laizhou Changyu Wine Acquired by
Laizhou, Laizhou,
Sales Co., Ltd. (“Laizhou Sales 100% establishment or
Shandong, China Shandong, China
Sales”) investment
Francs Champs Acquired by
Investment
Participations SAS Cognac, France Cognac, France 100% establishment or
and trading
(“Francs Champs”) investment
Yantai Roullet Fransac Wine Acquired by
Yantai, Shandong, Yantai, Shandong,
Sales Co., Ltd. (“Yantai Roullet Sales 100% establishment or
Fransac”) China China
investment
Yantai Changyu Wine Acquired by
Yantai, Shandong, Yantai, Shandong,
Sales Co., Ltd. (“Wine Sales 100% establishment or
China China
Sales Company”) investment
Shaanxi Chateau Changyu Acquired by
Xianxin, Shaanxi, Xianxin, Shaanxi,
Rena Tourism Co., Ltd. Tourism 100% establishment or
China China
(“Chateau Tourism”) investment
Longkou Changyu Wine Acquired by
Yantai, Shandong, Yantai, Shandong,
Sales Co., Ltd. (“Longkou Sales 100% establishment or
China China
Sales”) investment
Acquired by
Changyu Cultural Tourism Yantai, Shandong, Yantai, Shandong,
Tourism 100% establishment or
Company China China
investment
Acquired by
Yantai, Shandong, Yantai, Shandong,
Museum Tourism 100% establishment or
China China
investment
Yantai Changyu Cultural
Acquired by
Tourism Product Sales Yantai, Shandong, Yantai, Shandong,
Tourism 100% establishment or
Co., Ltd. (“Cultural China China
investment
Sales”)
Yantai Changyu Window
Acquired by
of International Wine City Yantai, Shandong, Yantai, Shandong,
Tourism 100% establishment or
Co. Ltd. (“Window of China China
investment
Wine City”)
Yantai Chateau Koya Acquired by
Yantai, Shandong, Yantai, Shandong,
Brandy Co., Ltd. Manufacturing 100% establishment or
China China
("Chateau Koya") investment
93
2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Proportion of
Principal business Business shareholding
Name of subsidiary Registration place Acquisition mode
location nature
Direct Indirect
Changyu (Shanghai)
Acquired by
International Digital
Shanghai, China Shanghai, China Sales 100% establishment or
Marketing Center Co.,
investment
Ltd. ("Digital Marketing")
Tianjin Changyu Yixin Acquired by
Digital Technology Co., Tianjin, China Tianjin, China Sales 51% establishment or
Ltd. (“Tianjin Yixin”) (a) investment
Shanghai Changyu Guoqu
Acquired by
Digital Technology Co.,
Shanghai, China Shanghai, China Sales 51% establishment or
Ltd. (“Shanghai Guoqu”)
investment
(a)
Yantai Christon Catering Acquired by
Yantai, Shandong, Yantai, Shandong,
Co., Ltd. (“Christon Catering 100% establishment or
China China
Catering”) (a) investment
(a) Companies above were newly established in 2021.
Explanation for difference between the proportion of shareholding and proportion of voting
power in the subsidiaries:
(b) Chateau Changyu is a Sino-foreign joint venture established by the Group and a foreign
investor, accounting for 70% of Changyu Chateau’s equity interest. Through agreement
arrangement, the Group has the full power to control Changyu Chateau’s strategic operating,
investing and financing policies. The agreement arrangement will be terminated on December
31, 2022.
(c) AFIP is a limited liability company jointly established by the Group and Yantai De’an and
Beijing Qinglang. In June 2019, Yantai Dean transferred 1.31% of its equity to Yantai
Changyu.After the equity change, the Group holds 91.53% of its equity. Through agreement
arrangement, the Group has the full power to control AFIP’s strategic operating, investing and
financing policies. The agreement arrangement will be terminated on September 2, 2024.
(d) Icewine Valley is a Sino-foreign joint venture established by the Group and a foreign
investor, whose 51% of the shares are held by the Group. The Group exercises full control
over the operation, investment and financing policies of Icewine Valley by contract
arrangement. The contract arrangement will expire on December 31, 2021.
(e) The Research, Development & Manufacture Company is a joint venture established by the
Group and Agricultural Development Fund, whose 85.32% of the shares were held by the
Group on June 30, 2021. As stated in Note 7.29, the Group exercises full control over the
operation, investment and financing policies of the Research, Development & Manufacture
Company by contract arrangement. The contract arrangement will expire on May 22, 2026.
Up to June 30, 2021, the remaining investment of the Agricultural Development Fund
accounted for 14.68% of the registered capital.
9.1.2 Important non-wholly-owned subsidiaries
Unit: Yuan
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Shareholding Profit/loss attributable Other comprehensive Dividend declared to Balance of minority
Name of proportion of to minority income attributable to be distributed to shareholder’s
subsidiary minority shareholders in this minority shareholders minority shareholders interest at the end of
shareholders period in this period in this period period
Xinjiang Tianzhu 40% -638,269 45,479,831
AFIP 8.47% 56,409,393
Icewine Valley 49% 33,319,062
Indomita Wine 15% 364,412 -2,566,658 53,807,100
Explanation for difference between the proportion of shareholding and proportion of voting
power of the minority shareholders in the subsidiaries: See details in Note 9.1.1.
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2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
9.1.3 Main financial information of important non-wholly-owned subsidiaries
Unit: Yuan
Ending balance Beginning balance
Name of subsidiary Non-current Current Non-current Total Non-current Current Non-current Total
Current assets Total assets Current assets Total assets
assets liabilities liabilities liabilities assets liabilities liabilities liabilities
Xinjiang Tianzhu 23,275,992 44,658,909 67,934,901 -175,687 5,336,115 5,160,428 24,223,370 45,465,308 69,688,678 -17,583 5,336,115 5,318,532
AFIP 253,132,832 423,282,099 676,414,931 36,226,455 3,518,784 39,745,239 248,357,550 434,045,076 682,402,626 41,910,462 41,910,462
Icewine Valley 42,114,240 23,277,409 65,391,649 28,328,190 28,328,190 27,638,263 24,246,983 51,885,246 9,967,686 9,967,686
Indomita Wine 205,193,993 316,329,347 521,523,340 145,456,750 9,794,949 155,251,699 231,503,343 291,345,642 522,848,985 132,100,755 9,794,949 141,895,704
Unit: Yuan
Amount incurred in this period Amount incurred in prior period
Name of
Total comprehensive Operating cash Total comprehensive
subsidiary Operating income Net profit Operating income Net profit Operating cash flow
income flow income
Xinjiang Tianzhu 18,349 -1,595,672 -1,595,672 -347,811 -3,171,133 -3,171,133 -756,855
AFIP 102,787,989 2,945,093 2,945,093 13,822,216 50,688,043 -2,919,024 -2,919,024 -1,954,062
Icewine Valley 9,007,185 -4,854,101 -4,854,101 2,755,011 7,365,586 -4,410,928 -4,410,928 733,935
Indomita Wine 91,401,584 2,429,411 -14,681,641 13,380,180 78,507,227 3,664,211 -3,634,807 29,108,449
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9.2 Equity in joint ventures or associates
Summary financial information of unimportant joint ventures and associates
Unit: Yuan
Ending balance/ amount incurred in Beginning balance / amount incurred
this period in prior period
Joint ventures -- --
Total book value of investment 40,893,992 42,019,654
Total of the following items calculated
-- --
according to the shareholding ratio
-- Net profit -1,125,662 -1,961,476
-- Other comprehensive income
-- Total comprehensive income -1,125,662 -1,961,476
Associates: -- --
Total book value of investment 6,265,735 6,243,853
Total of the following items calculated
-- --
according to the shareholding ratio
-- Net profit -496,118 -256,147
-- Other comprehensive income
-- Total comprehensive income -496,118 -256,147
10. Risks related to financial instruments
The Group has exposure to the following main risks from its use of financial instruments in
the normal course of the Group’s operations:
- Credit risk
- Liquidity risk
- Interest rate risk
- Foreign currency risk
The following mainly presents information about the Group’s exposure to each of the above
risks and their sources, their changes during the year, and the Group’s objectives, policies and
processes for measuring and managing risks, and their changes during the year.
The Group aims to seek appropriate balance between the risks and benefits from its use of
financial instruments and to mitigate the adverse effects that the risks of financial instruments
have on the Group’s financial performance. Based on such objectives, the Group’s risk
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management policies are established to identify and analyse the risks faced by the Group, to
set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk
management policies and systems are reviewed regularly to reflect changes in market
conditions and the Group’s activities.
10.1 Credit risk
Credit risk is the risk that one party to a financial instrument will cause a financial loss for the
other party by failing to discharge an obligation. The Group’s credit risk is primarily
attributable to cash at bank, receivables, debt investments and derivative financial instruments
entered into for hedging purposes. Exposure to these credit risks are monitored by
management on an ongoing basis.
The cash at bank of the Group is mainly held with well-known financial institutions.
Management does not foresee any significant credit risks from these deposits and does not
expect that these financial institutions may default and cause losses to the Group.
As at June 30, 2021, the Group's maximum exposure to credit risk which will cause a
financial loss to the Group due to failure to discharge an obligation by the counterparties.
In order to minimise the credit risk, the Group has adopted a policy to ensure that all sales
customers have good credit records. According to the policy of the Group, credit review is
required for clients who require credit transactions. In addition, the Group continuously
monitors the balance of account receivable to ensure there’s no exposure to significant bad
debt risks. For transactions that are not denominated in the functional currency of the relevant
operating unit, the Group does not offer credit terms without the specific approval of the
Department of Credit Control in the Group. In addition, the Group reviews the recoverable
amount of each individual trade debt at each balance sheet date to ensure that adequate
impairment losses are made for irrecoverable amounts. In this regard, the management of the
Group considers that the Group's credit risk is significantly reduced.
Since the Group trades only with recognised and creditworthy third parties, there is no
requirement for collateral. Concentrations of credit risk are managed by
customer/counterparty, by geographical region and by industry sector. As at June 30, 2021,
17.9% of the Group trade receivables are due from top five customers (December 31, 2020:
20.3%). There is no collateral or other credit enhancement on the balance of the trade
receivables of the Group.
10.2 Liquidity risk
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Liquidity risk is the risk that an enterprise will encounter difficulty in meeting obligations that
are settled by delivering cash or another financial asset. The Group and its individual
subsidiaries are responsible for their own cash management, including short-term investment
of cash surpluses and the raising of loans to cover expected cash demands (subject to approval
by the Group’s board when the borrowings exceed certain predetermined levels). The Group’s
policy is to regularly monitor its liquidity requirements and its compliance with lending
covenants, to ensure that it maintains sufficient reserves of cash, readily realisable marketable
securities and adequate committed lines of funding from major financial institutions to meet
its liquidity requirements in the short and longer term.
10.3 Interest rate risk
Interest-bearing financial instruments at variable rates and at fixed rates expose the Group to
cash flow interest rate risk and fair value interest risk, respectively. The Group determines the
appropriate weightings of the fixed and floating rate interest-bearing instruments based on the
current market conditions and performs regular reviews and monitoring to achieve an
appropriate mix of fixed and floating rate exposure.
(1) As at June 30, 2021, the Group held the following interest-bearing financial instruments:
Fixed rate instruments:
Unit: Yuan
June 30, 2021 December 31, 2020
Item
Effective interest rate Amounts Effective interest rate Amounts
Financial assets
- Cash at bank 1.5%-2.25% 73,553,062 1.5% - 2.75% 93,553,062
Financial liabilities
- Short-term loans 0.35%-1.38% -166,361,680 0.35% - 3.28% -139,090,715
- Long-term loans (including the
0.95%-3.28% -219,759,687 1% - 3.28% -280,414,858
portion due within one year)
- Long-term payables (including the
1.20% -86,000,000 1.20% -108,000,000
portion due within one year)
Total -398,568,305 -433,952,511
Variable rate instruments:
Unit: Yuan
June 30, 2021 December 31, 2020
Item
Effective interest rate Amounts Effective interest rate Amounts
Financial assets
- Cash at bank 0.3%-1.75% 1,440,145,113 0.3% - 1.0% 1,100,642,230
Financial liabilities
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June 30, 2021 December 31, 2020
Item
Effective interest rate Amounts Effective interest rate Amounts
- Short-term loans 1-year LPR -550,000,000 1-year LPR -550,000,000
- Long-term loans (including the
90% of 5-year LPR -76,983,600 90% of 5-year LPR -31,250,000
portion due within one year)
Total 813,161,513 519,392,230
(2) Sensitivity analysis
Management of the Group believes interest rate risk on bank deposit is not significant,
therefore does not disclose sensitivity analysis for interest rate risk.
As at June 30, 2021, based on assumptions above, it is estimated that a general increase of 50
basis points in interest rates, with all other variables held constant, would decrease the
Group’s equity by RMB 2,351,189 Yuan (2020: RMB 2,179,688 Yuan), and net profit by
RMB 2,351,189 Yuan (2020: RMB 2,179,688 Yuan).
The sensitivity analysis above indicates the instantaneous change in the net profit and equity
that would arise assuming that the change in interest rates had occurred at the balance sheet
date and had been applied to re-measure those financial instruments held by the Group which
expose the Group to fair value interest rate risk at the balance sheet date. In respect of the
exposure to cash flow interest rate risk arising from floating rate non-derivative instruments
held by the Group at the balance sheet date, the impact on the net profit and equity is
estimated as an annualised impact on interest expense or income of such a change in interest
rates.
10.4 Foreign currency risk
In respect of cash at bank and on hand, accounts receivable and payable, short-term loans denominated
in foreign currencies other than the functional currency, the Group ensures that its net exposure is kept
to an acceptable level by buying or selling foreign currencies at spot rates when necessary to address
short-term imbalances.
(1) As at June 30, 2021, the Group’s exposure to currency risk arising from recognised assets or
liabilities denominated in foreign currencies is presented in the following tables. For presentation
purposes, the amounts of the exposure are shown in Renminbi, translated using the spot rate at the
balance sheet date. Differences resulting from the translation of the financial statements
denominated in foreign currency are excluded.
Unit: Yuan
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2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
June 30, 2020 December 31, 2019
Item Balance at foreign Balance at RMB Balance at foreign Balance at RMB
currency equivalent currency equivalent
Monetary capital 22,907,583 14,053,435
- USD 2,782,429 17,974,767 1,492,923 9,744,604
- EUR 641,776 4,932,816 536,926 4,308,831
Accounts receivable 42,053,884
- USD 4,881,079 31,532,258
- EUR 854,020 6,564,169
- CAD 42,789 222,918
- GBP 417,687 3,734,539
Short-term borrowings 100,874,462 81,524,728
- USD 15,615,000 100,874,462 12,490,000 81,524,728
(2) Sensitivity analysis
Assuming all other risk variables remained constant, a 5% strengthening of the Renminbi
against the US dollar and Euro at June 30, 2021 would have impact on the Group’s equity and
net profit by the amount shown below, whose effect is in Renminbi and translated using the
spot rate at the year-end date:
Unit: Yuan
Item Equity Net profit
June 30, 2021
USD 4,144,985 4,144,985
EUR -246,641 -246,641
CAD -11,146 -11,146
GBP -186,727 -186,727
Total 1,795,650 1,795,650
December 31, 2020
USD 3,589,006 3,589,006
EUR -215,442 -215,442
Total 3,373,564 3,373,564
A 5% weakening of the Renminbi against the US dollar and Euro dollar at June 30, 2021
would have had the equal but opposite effect to the amounts shown above, on the basis that all
other variables remained constant.
11. Fair value disclosure
All financial assets and financial liabilities held by the Group are carried at amounts not
materially different from their fair value at June 30, 2021.
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12. Related parties and related transactions
12.1 Particulars of the parent company of the Company
Proportion of Proportion of
Name of parent shareholding of the voting powers of
Registration place Business nature Registered capital
company parent company in the parent company
the Company in the Company
Manufacturing
Changyu Group Yantai City 50,000,000 50.40% 50.40%
industry
From January to June 2021, there was no fluctuation in the registered capital of the parent
company and its share in equity interest and voting right.
12.2 Particulars of the subsidiaries of the Company
See particulars of the subsidiaries of the Company in Note 9.
12.3 Information about joint ventures and associates of the Company
Other joint ventures and associates that have related party transactions with the Group during
this period or that formed balance when having related party transactions with the Group
during the prior period are as follows:
Name of entity Relationship with the Company
L&M Holdings Joint venture of the Group
Weimeisi Shanghai Joint venture of the Group
Chengdu Yufeng Joint venture of the Group
12.4 Particulars of other related parties
Name of other related parties Relationship between other related parties and the Company
Yantai God Horse Packing Co., Ltd. (“God Horse Packing”) A company controlled by the same parent company
Yantai Zhongya Medical Health Wine Co., Ltd. (“Zhongya
A company controlled by the same parent company
Medical”)
Mirefleurs Subsidiaries of the joint venture
CHATEAU DE LIVERSAN (“LIVERSAN”） Subsidiaries of the joint venture
12.5 Related transactions
12.5.1 Related transactions of purchasing and selling goods and providing and receiving
services
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List of purchasing goods/receiving services
Unit: Yuan
Related parties Related transactions Amount incurred in this period Amount incurred in prior period
God Horse Packing Purchasing goods 35,161,524 35,624,517
Zhongya Medical Purchasing goods 164,039 574,791
Weimeisi Shanghai Purchasing goods 90,265
List of selling goods/providing services
Unit: Yuan
Related parties Related transactions Amount incurred in this period Amount incurred in prior period
Zhongya Medical Selling goods 1,456,492 1,349,021
God Horse Packing Selling goods 6,538 1,915
Chengdu Yufeng Selling goods 1,639,925
The price of transactions between the Group and the related parties are based on the
negotiated price.
12.5.2 Related trusteeship/contracting and mandatory administration/outsourcing
Nil
12.5.3 Leasing with related parties
The Group as a lessor:
Unit: Yuan
Rental income recognized in Rental income recognized in
Name of the lessee Type of leased assets
this period prior period
God Horse Packing Office building and plant 774,705 746,275
Zhongya Medical Office building 271,428
The Group as a lessee:
Unit: Yuan
Name of the lessor Type of leased assets Rent recognized in this period Rent recognized in prior period
Changyu Group Office building and plant 7,254,692 3,595,583
12.5.4 Related guarantee
Nil
12.5.5 Inter-bank borrowing and lending of related parties
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Nil
12.5.6 Asset transfer and debt recombination of related parties
Nil
12.5.7 Other related transactions
Unit: Yuan
Related party Item Amount incurred in this period Amount incurred in prior period
Changyu Group Trademark use fee 11,313,578 8,977,248
The price of transactions between the Group and the related parties are based on the
negotiated price.
12.6 Accounts receivable and payable of the related parties
12.6.1 Accounts receivable
Unit: Yuan
Ending balance Beginning balance
Item Related parties Provision for Provision for
Book balance Book balance
bad debts bad debts
Accounts receivable Zhongya Medical 399,844 2,526 714,995 3,175
Accounts receivable Wei Meisi Shanghai 1,553,316 6,898
Advance payment God Horse Packing 126,818
Other receivables Changyu Group 2,929,000
Other receivables Zhongya Medical 285,000 522,936
Other non-current assets Changyu Group 158,377,754 170,370,147
12.6.2 Accounts payable
Unit: Yuan
Item Related parties Ending book balance Beginning book balance
Accounts payable God Horse Packing 18,870,829 33,421,165
Accounts payable Zhongya Medical 15,684 455,176
Accounts payable Changyu Group 19,434,600 19,434,600
Accounts payable Weimeisi Shanghai 101,800
Liabilities of contracts Chengdu Yufeng 611,004
Other accounts payable God Horse Packing 450,000
Liabilities of lease Changyu Group 36,360,128
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13. Share-based payment
Nil
14. Commitment and contingency
14.1 Significant commitment
Unit: Yuan
Item Ending balance Beginning balance
Making long-term asset commitments 169,379,500 249,379,500
14.2 Contingency
As of the balance sheet date, the Group didn’t have any contingency to be disclosed.
15. Matters after balance sheet
15.1 Important non-adjusting events
Nil
15.2 Profit distribution
Unit: Yuan
Profits or dividends to be distributed 274,185,600
Allocated profits or dividends approved to declare upon discussion 274,185,600
15.3 Other statement of events after the balance sheet date
According to the decision of the Shareholders’ Meeting dated May 27, 2021, based on the
issued capital stock of 685,464,000 shares in 2020, the Group allocated RMB 4 Yuan in cash
(including tax) for every 10 shares to all shareholders with the total cash dividends of RMB
274,185,600 Yuan. Such cash dividends were distributed on July 13, 2021 and July 15, 2021
respectively.
16. Other important matters
Nil
17. Notes on major items in financial statements of the parent company
17.1 Accounts receivable
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17.1.1 Accounts receivable disclosed by type
Unit: Yuan
Ending balance Beginning balance
Book balance Provision for bad debts Book balance Provision for bad debts
Type Book Book
Accrued Accrued
Amount Proportion Amount value Amount Proportion Amount value
proportion proportion
Accounts receivable for
which provision for bad
debts is accrued on a single
item basis
Accounts receivable for bad
debts is accrued on a 70,248 100% 443 0.63% 69,805
combined basis
Total 70,248 100% 443 0.63% 69,805
Provision for bad debts accrued on a combined basis:
Unit: Yuan
Ending balance
Name
Book balance Provision for bad debts Accrued proportion
Amounts due from related parties 70,248 443 0.63%
Total 70,248 443 --
Disclosed by age:
Unit: Yuan
Age Ending balance
Within 1 year (including 1 year) 70,248
1-2 years
2-3 years
Over 3 years
Total 70,248
17.1.2 Provision for bad debts accrued, withdrawn or transferred back in this period
Unit: Yuan
Changes in this period
Beginning Ending
Type Withdrawn or
balance Accrued Cancelled balance
transferred back
Accounts receivable for which provision for
443 443
bad debts is accrued by credit risk features
Total 443 443
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17.1.3 Accounts receivable actually cancelled after verification in this period
Nil
17.1.4 Accounts receivable collected by the borrower of top 5 units ranked by the ending
balance
Unit: Yuan
Ending balance of accounts Proportion in total ending Ending balance of bad debt
Unit name
receivable balance of accounts receivable reserves
Zhongya Medicine and Health
70,248 100% 443
Care Wine Company
Total 70,248 100%
17.1.5 Accounts receivable derecognized due to transfer of financial assets
Nil
17.1.6 Accounts receivable transferred and included in assets and liabilities
Nil
17.2 Other receivables
Unit: Yuan
Item Ending balance Beginning balance
Interest receivable
Dividends receivable 200,000,000
Other receivables 271,659,240 380,131,798
Total 271,659,240 580,131,798
17.2.1 Dividends receivable
Unit: Yuan
Item (or the invested unit) Ending balance Beginning balance
Dividends receivable from subsidiaries 200,000,000
Total 200,000,000
17.2.2 Other receivables
17.2.2.1 Particulars of other receivables classified by nature
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Unit: Yuan
Nature Ending book balance Beginning book balance
Accounts receivable from subsidiaries 270,047,970 379,375,427
Accounts receivable from related parties 1,017,250 522,936
Other 594,020 233,435
Total 271,659,240 380,131,798
17.2.2.2 Disclosed by age
Unit: Yuan
Age Ending balance
Within 1 year (including 1 year) 271,639,240
1-2 years
2-3 years
More than 3 years 20,000
Total 271,659,240
17.2.2.3 Provision for bad debts accrued, withdrawn or transferred back in this period
The provision for bad debts accrued in this period was RMB 0 Yuan.
17.2.2.4Accounts receivable actually cancelled after verification in this period
Nil
17.2.2.5 Other accounts receivable collected by the borrower of top 5 units ranked by the
ending balance
Unit: Yuan
Percentage in the
Ending balance
total ending
Unit Nature of fund Ending balance Age of provision for
balance of other
bad debts
accounts receivable
Sales combination Internal incomings and outgoings 229,035,379 Within 1 year 84.30%
R&D combination Internal incomings and outgoings 17,933,959 Within 1 year 6.60%
Wine Sales Internal incomings and outgoings 9,954,634 Within 1 year 3.70%
Digital Marketing Internal incomings and outgoings 6,649,870 Within 1 year 2.40%
Laizhou Sales Internal incomings and outgoings 895,993 Within 1 year 0.30%
Total -- 264,469,835 -- 97.3%
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2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
17.2.2.6 Accounts receivable related to governmental subsidy
Nil
17.2.2.7 Other accounts receivable derecognized due to transfer of financial assets
Nil
17.2.2.8 Other accounts receivable transferred and included in assets and liabilities
Nil
17.3 Long-term equity investment
Unit: Yuan
Ending balance Beginning balance
Item Impairment Impairment
Book balance Book value Book balance Book value
reserve reserve
Investment in subsidiaries 7,593,535,027 7,593,535,027 7,593,535,027 7,593,535,027
Investment in associated enterprises
5,766,091 5,766,091 6,243,853 6,243,853
and joint ventures
Total 7,599,301,118 7,599,301,118 7,599,778,880 7,599,778,880
17.3.1 Investment in subsidiaries
Unit: Yuan
Increase and decrease in this period Ending
Beginning Ending
balance of
Invested unit balance (book Increase in Decrease in Provision for balance (book
Others provision for
value) investment investment impairment accrued value)
impairment
Xinjiang Tianzhu 60,000,000 60,000,000
Kylin Packaging 23,176,063 23,176,063
Changyu Chateau 28,968,100 28,968,100
Pioneer International 3,500,000 3,500,000
Ningxia Growing 36,573,247 36,573,247
National Wine 2,000,000 2,000,000
Icewine Valley 30,440,500 30,440,500
AFIP 588,389,444 588,389,444
Sales Company 7,200,000 7,200,000
Langfang Sales 100,000 100,000
Langfang Castel 19,835,730 19,835,730
Wine Sales 4,500,000 4,500,000
Shanghai Marketing 1,000,000 1,000,000
Beijing Marketing 850,000 850,000
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2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Increase and decrease in this period Ending
Beginning Ending
balance of
Invested unit balance (book Increase in Decrease in Provision for balance (book
Others provision for
value) investment investment impairment accrued value)
impairment
Jingyang Sales 100,000 100,000
Jingyang Wine 900,000 900,000
Ningxia Wine 222,309,388 222,309,388
Ningxia Chateau 453,463,500 453,463,500
Chateau Tinlot 212,039,586 212,039,586
Shihezi Chateau 812,019,770 812,019,770
Chang’an Chateau 803,892,258 803,892,258
R&D Company 3,288,906,445 3,288,906,445
Huanren Wine 22,200,000 22,200,000
Wine Sales Company 5,000,000 5,000,000
Francs Champs 236,025,404 236,025,404
Marques del Atrio 233,142,269 233,142,269
Indomita Wine 274,248,114 274,248,114
Kilikanoon Estate,
129,275,639 129,275,639
Australia
Digital Marketing 1,000,000 1,000,000
Changyu Cultural
92,479,570 92,479,570
Tourism Company
Total 7,593,535,027 7,593,535,027
17.3.2 Investment in associates
Unit: Yuan
Increase and decrease in this period
Investment Ending
Beginning gains and Ending
Other Declared Provision balance of
balance Decrease losses Other balance
Invested unit Increase in comprehensive cash for provision
(book in recognized changes Others (book
investment income dividend impairment for
value) investment under the in equity value)
adjustment or profit accrued impairment
equity
method
Weimeisi
2,743,890 2,193 2,746,083
Shanghai
Yantai Santai
Real Estate
3,499,963 -479,955 3,020,008
Development
Co., Ltd.
Total 6,243,853 -477,762 5,766,091
17.4 Operating income and operating cost
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Unit: Yuan
Amount incurred in this period Amount incurred in prior period
Item
Income Cost Income Cost
Main business 189,490,544 153,868,830 132,995,774 125,288,367
Other business 16,810,022 15,143,341 19,954,741 17,952,827
Total 206,300,566 169,012,171 152,950,515 143,241,194
17.4.1 Details of operating income
Unit: Yuan
Amount incurred in this period
Item
Income Cost
Main business 189,490,544 153,868,830
Other business 16,810,022 15,143,341
Total 206,300,566 169,012,171
Including: Income from contracts 205,254,433 168,378,524
Income from house rents 1,046,133 633,647
17.4.2 Situation of income from contracts
Unit: Yuan
Contract classification Amount incurred in this period
Type of merchandise
- Alcoholic beverage 189,490,544
- Others 15,763,889
Classified by the time of merchandise transfer
- Revenue recognized at a point in time 205,254,433
17.5 Investment income
Unit: Yuan
Amount incurred in Amount incurred in
Item
this period prior period
Income from long-term equity investment by cost method 495,005,832 87,474,604
Income from long-term equity investment by equity method -477,762
Investment income from disposal of long-term equity investment
Investment income of the financial assets measured at their fair values and the
variation of which is recorded into the current profits and losses during the
holding period
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Amount incurred in Amount incurred in
Item
this period prior period
Investment income gained from disposal of the financial assets measured at
their fair values and the variation of which is recorded into the current profits
and losses
Investment income of held-to-maturity investment during the holding period
Investment income of financial assets held for sale during the holding period
Investment income gained from disposal of financial assets held for sale
Gains generated from the remaining equity remeasured as per fair value after
the loss of control
Total 494,528,070 87,474,604
18. Supplementary materials
18.1 List of non-current profits/losses in this period
Unit: Yuan
Item Amount Remark
Profits/losses on disposal of non-current assets
Tax return, deduction and exemption approved beyond the authority or
without formal approval document
Governmental subsidy included in the current profits/losses (excluding those
closely related to the enterprise business and enjoyed in accordance with the 21,978,695
unified standard quota or ration of the state)
Payment for use of funds by non-financial enterprises included in the current
profits/losses
Income obtained when the investment cost obtained by the enterprise from
subsidiaries, joint-run business and joint venture is less than the fair value of
the net identifiable assets obtained from the invested units when the
investment is made
Profits/losses on exchange of non-monetary assets
Profits/losses on entrusting other people to make investment or manage assets
Asset impairment provision accrued due to force majeure such as natural
disaster
Profits/losses on debt restructuring
Enterprise reorganization expenses such as staffing expenditure and
integration expenses, etc.
Profits/losses on those beyond the fair value generated from transactions with
unfair transaction price
Current net profits/losses on subsidiaries acquired from a business
combination under common control from the beginning to the consolidation
date
Profits/losses on contingencies irrelated to the normal business of the
Company
Profits/losses on changes of fair value of tradable financial assets, derivative
financial assets, tradable financial liabilities and derivative financial
liabilities, and investment income from disposal of tradable financial assets,
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2020 Semiannual Report of Yantai Changyu Pioneer Wine Co., Ltd.
Item Amount Remark
derivative financial assets, tradable financial liabilities, derivative financial
liabilities and other investment in creditor's rights, excluding effective
hedging operations relevant to the normal business of the Company
Transfer-back of accounts receivable with single impairment test and
provision for impairment of contract assets
Profits/losses on external entrusted loans
Profits/losses on fair value changes of investment real estate with fair value
mode for follow-up measurement
Influence of the one-time adjustment of the current profits/losses in
accordance with tax and accounting laws and regulations on the current
profits/losses
Trustee fee income from entrusted operation
Other non-operating income and expenditure besides the above items 1,919,057
Other profits/losses conforming to the definition of non-current profits/losses
Minus: Influenced amount of income tax 5,737,342
Influenced amount of minority shareholders’ equity 14,633
Total 18,145,777 --
18.2 Return on net assets and earnings per share
Earnings per share
Weighted average return on
Profit incurred in this period Basic EPS Diluted EPS
net assets
(Yuan/Share) (Yuan/Share)
Net profit attributable to common
3.57% 0.54 0.54
shareholders of the Company
Net profit attributable to common
shareholders of the Company deducting 3.40% 0.52 0.52
non-incidental profits/losses
18.3 Accounting data difference under domestic and foreign accounting standard
18.3.1 Net profits & net assets difference disclosed in the financial report according to
the international accounting standard and Chinese accounting standard
Unit: Yuan
Net profits Net assets
Amount incurred in Amount incurred in prior
Ending balance Beginning balance
this period period
In accordance with the
371,821,819 318,640,075 10,333,217,946 10,257,200,222
Chinese accounting standard
Item & amount adjusted in accordance with the international accounting standard:
In accordance with the
international accounting 371,821,819 318,640,075 10,333,217,946 10,257,200,222
standard
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