Foshan Huaxin Packaging Co., Ltd. Interim Report 2018 (Summary)
Stock Code: 200986 Stock Name: Huaxin Packaging-B Announcement No. 2018-052
FOSHAN HUAXIN PACKAGING CO., LTD.
INTERIM REPORT 2018 (SUMMARY)
Part I Important Notes
This Summary is based on the full text of the 2018 Interim Report of Foshan Huaxin Packaging Co., Ltd. (together with its
consolidated subsidiaries, the “Company”, except where the context otherwise requires). In order for a full understanding of the
Company’s operating results, financial condition and future development plans, investors should carefully read the aforesaid full text,
which has been disclosed together with this Summary on the media designated by the China Securities Regulatory Commission (the
“CSRC”).
Objections raised by any of the directors, supervisors or senior management against any contents in this Report or its summary:
Name Office title Objection and explanation of why
Statement of objection:
Except for the following directors, all the other directors attended in person the Board meeting for the review of this Report and its
summary.
Reason for not attending
Name Office title Proxy
meeting in person
Independent auditor’s modified opinion:
□ Applicable √ Not applicable
Board-approved interim cash and/or stock dividend plan for ordinary shareholders:
□ Applicable √ Not applicable
The Company has no interim dividend plan, either in the form of cash or stock.
Board-approved interim cash and/or stock dividend plan for preferred shareholders:
□ Applicable √ Not applicable
This Report and its summary have been prepared in both Chinese and English. Should there be any discrepancies or
misunderstandings between the two versions, the Chinese versions shall prevail.
Part II Key Corporate Information
1. Stock Profile
Stock name Huaxin Packaging-B Stock code 200986
Stock exchange for stock listing Shenzhen Stock Exchange
Contact information Board Secretary Securities Representative
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2018 (Summary)
Name Ding Guoqiang Shi Hui
2/F, Block 7, 3 Keyang Road, Luoge Park, 2/F, Block 7, 3 Keyang Road, Luoge Park,
Chancheng Economic Development Zone, Chancheng Economic Development Zone,
Office address
Nanzhuang Town, Chancheng District, Nanzhuang Town, Chancheng District,
Foshan, Guangdong Province, P.R.China Foshan, Guangdong Province, P.R.China
Tel. 0756-8666976 0756-8666978
E-mail address dinggq@htrh-paper.com shih@htrh-paper.com
2. Key Financial Information
Indicate by tick mark whether there is any retrospectively restated datum in the table below.
□ Yes √ No
H1 2018 H1 2017 Change (%)
Operating revenue (RMB) 1,747,156,340.92 1,567,199,202.22 11.48%
Net profit attributable to the listed
-15,299,762.79 12,487,648.99 -222.52%
company’s shareholders (RMB)
Net profit attributable to the listed
company’s shareholders before exceptional -19,203,743.87 10,079,841.69 -290.52%
items (RMB)
Net cash generated from/used in operating
68,792,986.11 -607,133,297.57 111.33%
activities (RMB)
Basic earnings per share (RMB/share) -0.0303 0.0247 -222.67%
Diluted earnings per share (RMB/share) -0.0303 0.0247 -222.67%
Weighted average return on equity (%) -0.78% 0.63% -1.41%
30 June 2018 31 December 2017 Change (%)
Total assets (RMB) 5,545,611,825.09 5,426,368,352.69 2.20%
Equity attributable to the listed company’s
1,945,505,839.28 1,982,859,436.21 -1.88%
shareholders (RMB)
3. Shareholders and Their Holdings at Period-End
Unit: share
Number of preferred
Number of ordinary shareholders 13,665 shareholders with resumed 0
voting rights (if any)
Top 10 shareholders
Name of Nature of Shareholding Number of Pledged or frozen shares
Non-tradable shares
shareholder shareholder percentage shares Status Shares
FOSHAN
HUAXIN State-owned
65.20% 329,512,030 329,512,030
DEVELOPME legal person
NT CO., LTD.
GUOTAI
JUNAN
SECURITIES Foreign legal
0.62% 3,157,453 0
(HONG person
KONG)
LIMITED
WU Domestic
0.51% 2,561,991 0
HAOYUAN natural person
Domestic
CAI YUJIU 0.33% 1,675,799 0
natural person
MIAO JUN Domestic 0.30% 1,522,200 0
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2018 (Summary)
natural person
NORGES Foreign legal
0.27% 1,352,720 0
BANK person
ESSENCE
INTERNATION
AL
Foreign legal
SECURITIES 0.24% 1,205,252 0
person
(HONG
KONG) CO.,
LTD.
KGI ASIA Foreign legal
0.23% 1,161,959 0
LIMITED person
FOSHAN
CHAN BEN DE
State-owned
ASSET 0.23% 1,139,420 1,139,420
legal person
MANAGEMEN
T CO., LTD
Domestic
ZHANG LI 0.20% 1,011,300 0
natural person
Connected or acting-in-concert It is unknown whether there is among the above shareholders any connected parties or
parties among shareholders acting-in-concert parties as defined in the Administrative Measures for the Acquisition of Listed
above Companies.
Shareholders conducting margin
N/A
trading (if any)
4. Change of Controlling Shareholder or Actual Controller in Reporting Period
Change of the controlling shareholder in the Reporting Period:
□ Applicable √ Not applicable
The controlling shareholder remained the same in the Reporting Period.
Change of the actual controller in the Reporting Period:
□ Applicable √ Not applicable
The actual controller remained the same in the Reporting Period.
5. Number of Preferred Shareholders and Shareholdings of Top 10 of Them
□ Applicable √ Not applicable
No preferred shareholders in the Reporting Period.
6. Corporate bonds
Does the Company have any corporate bonds publicly offered on the stock exchange, which were undue before the date of this
Report’s approval or were due but could not be redeemed in full?
No.
Part III Operating Performance Discussion and Analysis
1. Business Overview of Reporting Period
Is the Company subject to any disclosure requirements for special industries?
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2018 (Summary)
No.
(1) Operating Results of Reporting Period
In the first half of 2018, according to the management direction of “Improve Efficiency through Reform and Increase Earnings
through Cost Reduction”, the Company made great efforts to “Reduce Inventories, Receivables and Expenditure, Improve Efficiency
and Control Costs”. It firmly pushed forward reform on its operational structure to break down barriers inside the Company and
improve its operational efficiency. Meanwhile, it has rebuilt its marketing system towards value creation through bold reforms. In
addition, it spent great effort on reforming its R&D department to strengthen the driving force of technology for the Company’s
continuous growth. However, high price levels of wood pulp and other materials across the globe, as well as the depreciation of the
Chinese yuan caused great pressure on the Company’s cost control.
For the Reporting Period, the Company recorded operating revenue of RMB1,747.1563 million, profit before taxation of
RMB-29.9999 million and net profit attributable to the listed company’s shareholders of RMB-15.2998 million. As at the end of the
Reporting Period, the Company’s total assets stood at RMB5,545.6118 million, with a gearing ratio of 36.03%.
(2) Management Measures during the Reporting Period
A. Implemented the reform of organizational structure and optimized the internal assessment mechanism
In the first half of the year, the Company carried out its organizational restructuring with the goal of “layer reduction, functional
conclusion, and management flattening”, improved the efficiency of the Company’s operation and management, and adjusted the
internal assessment system to improve the work enthusiasm of all employees.
B. Conducted the marketing mechanism reform to stimulate the potential
In accordance with the overall reform thought of New Era and New Marketing, the Company carried out a comprehensive reform of
the marketing system, optimized and highlighted the core function of marketing. The management mode was changed from the
product-based horizontal cross-regional management to the regional-oriented management with the product line playing its
supporting role.
The marketing appraisal system was also optimized and reformed, and a new performance appraisal mechanism was implemented to
stimulate the development of new orders. At the same time, the Company established the marketing mechanism to implement the
lowliest place elimination, reward the diligent and punish the lazy and carry out the flexible promotion system.
C. Finished product logistics business was outsourced to save the logistics fees
In the first half of the year, the Company focused on “Four New” concept -- New Reform Measures, New Management Methods,
New Management Thoughts, and New Activation Mechanism and actively reduced inventories, receivables and expenditure,
improved efficiency and controlled costs. Meanwhile, the finished goods logistics business was also outsourced, which largely
reduced the (per ton) cost of the Company’s paper in the first half of the year.
D. Enhanced the technology’s leading role and improved the performance of R&D
The Company reorganized the organizational structure of the technology center, independently operated the new product R&D
functions and the daily process maintenance functions, and highlighted various core functions of the technology research and
development. At present, more than ten kinds of new products are being researched, and breakthrough has been made in some
products.
(3) Management methods for the second half of the year
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2018 (Summary)
In the second half of the year, the Company will still focus on reducing inventories, receivables and expenditure, improving
efficiency and controlling costs, proceed from stimulating the potential, improving the data effectiveness and further determining the
subject of responsibility, and vigorously promote PMO in order to internally improve the efficiency and reduce costs, and externally
expand the market (core task) and continuously enhance the management level.
2. Matters Related to Financial Reporting
(1) Changes in Accounting Policies, Accounting Estimates or Measurement Methods Compared to Last
Accounting Period
□ Applicable √ Not applicable
No such changes.
(2) Retrospective Restatements due to Correction of Material Accounting Errors in Reporting Period
□ Applicable √ Not applicable
No such cases.
(3) Changes in Scope of Consolidated Financial Statements Compared to Last Accounting Period
□ Applicable √ Not applicable
No such changes.
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