CHINA MERCHANTS PORT GROUP CO., LTD.
ANNUAL REPORT 2020
Date of disclosure: 31 March 2021
China Merchants Port Group Co., Ltd. Annual Report 2020
Chairman’s Statement
Dear shareholders,
I hereby present to you the annual report of China Merchants Port Group Co., Ltd. and its
subsidiaries (the “Company”) for the year ended 31 December 2020. On behalf of the Board, I
would like to express my sincere gratitude to all of you for your long-term support to the Company.
The Company is a crucial vehicle for CMG to implement the “Belt and Road” Initiative promoted
by China and the “Guangdong-Hong Kong-Macao Greater Bay Area” strategy. The Company is
also the headquarters of CMG’s port sector and tier one capital operation and management platform
for the CMG’s port assets, playing a key role in the consolidation and synergistic development of
CMG’s port assets. The Company has become the world’s leading port investor, developer and
operator.
Looking ahead, the Company will take actions and strive to be a world-class comprehensive port
service provider. While expanding the port ecosystem with a focus on core port businesses and
promoting the construction of “Intelligent Port” under the guidance of technology innovation; it will
proactively take part in international port investment, development and operation, so as to optimize
the port network system on a continuous basis and achieve balanced development on a regional
level. By offering professional top-notch solutions, it will become customers’ first choice of partner
for cooperation, creating greater value for the Company, enhancing return for shareholders and
contributing to the healthy development of the port industry and the continuous growth of the global
trade.
Review for the year
In 2020, under the multiple impacts of the COVID-19 pandemic, anti-globalization and geopolitical
risks, the overall global economy experienced recession to some degree. Weak consumption,
shrinking trade and fluctuations in exchange rates, along with other uncertainties, imposed
challenges to the daily operation and management of businesses. Despite the complex and difficult
external environment, the Company firmly adhered to the strategic principle of “leveraging on its
long-term strategy, tapping the current edges, driving through technology and embracing changes”.
Apart from coping with the pandemic proactively, it pursued various key construction projects in a
steady manner, including the construction of homebased ports, overseas expansion and digital
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China Merchants Port Group Co., Ltd. Annual Report 2020
innovation, and successfully accomplished its strategic goals and various operational objectives of
the year.
In terms of port operation, the container port business delivered a container throughput totaled
121.71 million twenty-foot equivalent units (TEUs) in 2020, up 7.8% year-on-year. Looking into
the regional performance, container throughput handled by the Company’s ports in Mainland China
totaled 85.76 million TEUs, up 1.0% year-on-year. Ports in Hong Kong and Taiwan handled a
combined container throughput of 7.16 million TEUs, down 0.7% year-on-year, while overseas
projects handled a total container throughput of 28.78 million TEUs, up 38.1% year-on-year. Bulk
cargo volume handled by the Company’s ports decreased by 7.1% year-on-year to 450 million tons,
among which the Company’s ports in Mainland China handled a total bulk cargo volume of 448
million tons, down 7.1% year-on-year, and the overseas port projects handled a total bulk cargo
volume of 5.83 million tons, down 7.2% year-on-year. Among the major ports, container
throughput handled in West Shenzhen Port Zone in China was 11.84 million TEUs, up 3.6% year-
on-year. SIPG handled a container throughput of 43.50 million TEUs, representing a year-on-year
increase of 0.5%. For overseas projects, CICT in Sri Lanka delivered a year-on-year growth of
1.9% by handling a container throughput of 2.93 million TEUs. LCT in Togo handled a container
throughput of 1.36 million TEUs, representing a growth of 20.5% year-on-year. Kumport in Turkey
handled a container throughput of 1.22 million TEUs, representing a decrease of 5.1% year-on-year.
TCP in Brazil handled a container throughput of 0.98 million TEUs, representing a year-on-year
increase of 7.4%. Benefiting from the inclusion of the eight newly acquired ports, Terminal Link
SAS (TL) handled a container throughput of 21.13 million TEUs in the year, up 59.4% year-on-year.
In terms of key priorities, firstly, the Company pursued the development of homebase ports to
fully promote the construction of world-class leading ports and achieve the strategic goal of
building a strong transportation country. West Shenzhen Port Zone has closely followed the
development strategy of Guangdong-Hong Kong-Macao Greater Bay Area and continued to
enhance its comprehensive capability. For overseas homebase ports, CICT and HIPG took full
advantages of the synergy of port zones and developed themselves into international shipping
centers in South Asia. Secondly, overseas expansion has achieved substantial progress. The delivery
procedures of 8 terminals arising from the equity acquisition of 10 terminals, with superior quality,
from CMA CGM through TL were completed. At the same time, the Company introduced Fujian
3
China Merchants Port Group Co., Ltd. Annual Report 2020
Transportation Maritime Silk Road Investment and Management Co. Limited (福建省交通海丝投
资管理有限公司) as the strategic investor of HIPG. Thirdly, digital innovation continued to bear
fruits. With the delivery and acceptance of the first berth, the Mawan Intelligent Port construction
project will be developed into a benchmark for the intelligence upgrade of traditional terminals at
home and abroad. The innovative development of the complex port in the Guangdong-Hong Kong-
Macao Greater Bay Area greatly increased the turnover efficiency of terminals and containers. The
Company proactively worked with leading Internet technology companies to explore the
construction of an open platform for intelligent ports. It also invested and established China
Merchants Port (Shenzhen) Industrial Innovation Private Equity Investment Fund (招商港口（深
圳 ） 产 业 创 新 私 募 股 权 投 资 基 金 ) in collaboration with China Merchants Venture, which
enhanced the industry ecosystem through integration between the industry and the financial sector.
Outlook
Looking into 2021, the successful research, development and rollout of the COVID-19 vaccines
will support the resumption of global economic and social activities and the world’s economy is
likely to recover. The year 2021 follows China’s conclusion of building a moderately prosperous
society in 2020 and marks the first year of the “14th Five-Year” Plan and 2035 Vision. China will
take the initiative to adapt to the new environment and new challenges. Adhering to the new
development philosophy, it will promote high-quality economic and social development by
intensifying the supply-side restructuring, paying attention to demand-side management and
establishing the new dual circulation development pattern. As the first country to witness a rapid
economic rebound from the pandemic, China will continue to lead global economic recovery in
2021. It will accelerate the establishment of the new development pattern, in which the domestic
economic cycle is the mainstay and the domestic and international economic cycles boost each
other. The macro policy will remain consistent, stable and sustainable, while supply-side reform and
demand-side management will further strengthen organic growth drivers. The industry will see
opportunities arising from innovation policy in key areas such as the Yangtze River Delta,
Guangdong-Hong Kong-Macao Greater Bay Area and Hainan Free Trade Port. In addition, with the
steady progress of the “New Infrastructure” project, port investment will maintain stable growth.
The construction of leading ports will facilitate green and intelligent port development, and port
transformation and upgrade will support sustainable industry growth. The Company will firmly
4
China Merchants Port Group Co., Ltd. Annual Report 2020
adhere to the overall operation philosophy of “making progress amid stability”, consistently
implement the new development concepts and insist on the strategic principle of “leveraging on its
long-term strategy, tapping the current edges, driving through technology and embracing changes”.
It will adhere to the dual-core-driven operating model of “marketization + digitization”, while
taking the initiative to respond actively and make breakthroughs on key missions, exploring
potential in the process of reform and innovation, and enhancing market competitiveness with
dedication, so as to become a world-class comprehensive port service provider and generate greater
returns for shareholders.
In 2021, the Company will focus on the following tasks:
Firstly, the Company will spare no effort to promote the development of world-class leading
ports to implement the strategy of building a strong transportation country. It will refine and
optimize the future development goals and action plans for West Shenzhen Port Zone and boost
comprehensive capabilities in line with the development strategy of the Guangdong-Hong Kong-
Macao Greater Bay Area. Through better resource allocation, enhancement of the management
basis, expansion of ancillary and value-added services, and improvement of service standards, it
will develop a port ecosystem for win-win outcomes. At the same time, it will be fully committed to
further incorporating intelligence elements into Mawan Intelligent Port and developing West
Shenzhen Port Zone into a globally leading intelligent port in Guangdong-Hong Kong-Macao
Greater Bay Area and the world, thereby achieving business innovation and increasing its influence
in the region. In terms of overseas homebase ports, CICT and HIPG will focus on port business and
strengthen cooperation with shipping companies, so as to enhance business synergy, capitalize on
the collaborative advantages between port zones and evolve into world-class shipping centers in
South Asia.
Secondly, the Company will enhance the overall planning for business abroad in line with the
overseas layout of “East-West routes, South-North routes, regions along the Belt and Road
Initiative”. Apart from completing the delivery procedures for the remaining two terminals of
CMA CGM, it will improve the operating effectiveness and efficiency of overseas projects by
optimizing their management and control system and tapping into the location advantages of ports
abroad. In the face of the current complex international dynamic, it will keep abreast of changes in
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China Merchants Port Group Co., Ltd. Annual Report 2020
the trade environment and continuously search for port investment opportunities in fast-growing
regions.
Thirdly, the Company will strengthen technology empowerment to create an innovative port
ecosystem. Taking technology innovation as an entry point, it will optimize and complement the
comprehensive port service model to support long-term growth through technology empowerment.
With a view to support new business, the Company will establish new business models in the
Development and Research Center of CMPort to extend its business to the upstream and
downstream of the industrial and value chain. It will also enhance the operating effectiveness and
efficiency of current assets through technological and management innovation, and boost
production and operation of ports and terminals by improving intelligent terminal operation via the
“CM Chip” platform. With the “CM ePort” platform, the Company will innovate a business model
to provide better customer service at ports. By establishing an intelligent management platform, it
will also enhance comprehensive port management.
Fourthly, the Company will promote comprehensive port development. It will closely follow
changes in the trade environment, seize opportunities brought by the adjustment of the global
industrial chain, and utilize favorable policies to exploit the market. By adequately integrating the
resources from the port industrial chain, value chain, logistics chain and innovation chain, it will
explore the PPC comprehensive development model and seek for sustainable business development
through “investment introduction to industrial parks and comprehensive land development”.
Fifthly, the Company will further develop the operating management and control system for
sustainable value creation. It will continue to follow strategic guidance and optimize management
and control on a regular basis. It will also establish an entire lifecycle management system for assets
to enhance construction quality and management of major engineering projects. By the ongoing
improvement of business management standards and the applicable range of regulation, it aims to
develop a world-class operating and management system, with sustainable value, and a value-
oriented management headquarters.
Appreciation
In 2020, facing the complex environment, various risks and challenges, the Company adhered to its
strategic directives, took the initiative to embrace changes, and thus recorded positive results for
various tasks and its operating performances have been growing steadily. All of these could not be
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China Merchants Port Group Co., Ltd. Annual Report 2020
accomplished without the dedication from all of our staff and the support from our shareholders,
investors, business partners, and those in the society who have taken to heart the Company’s
interest. For this, I would like to extend my most sincere appreciation and deepest gratitude.
Deng Renjie
Chairman
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China Merchants Port Group Co., Ltd. Annual Report 2020
Part I Important Notes, Table of Contents and Definitions
The Board of Directors (or the “Board”), the Supervisory Committee as well as the directors,
supervisors and senior managers of China Merchants Port Group Co., Ltd. (hereinafter referred to
as the “Company”) hereby guarantee the factuality, accuracy and completeness of the contents of
this Report and its summary, and shall be jointly and severally liable for any misrepresentations,
misleading statements or material omissions therein.
Bai Jingtao, the Company’s legal representative, Lu Yongxin, the Company’s Acting Chief
Financial Officer, and Sun Ligan, the person-in-charge of the accounting organ hereby guarantee
that the financial statements carried in this Report are factual, accurate and complete.
All the Company’s directors have attended the Board meeting for the review of this Report and its
summary.
Any forward-looking statements such as future plans or development strategies mentioned herein
shall not be considered as the Company’s promises to investors. And investors are reminded to
exercise caution when making investment decisions. Possible risks faced by the Company and
countermeasures have been explained in “Part IV Operating Performance Discussion and Analysis”
herein, which investors are kindly reminded to pay attention to.
Securities Times, Shanghai Securities News, Ta Kung Pao (HK) and www.cninfo.com.cn have been
designated by the Company for information disclosure. And all information about the Company
shall be subject to what’s disclosed on the aforesaid media. Investors are kindly reminded to pay
attention to these media.
The Board has approved a final dividend plan as follows: based on 1,922,365,124 shares, a cash
dividend of RMB3.80 (tax inclusive) per 10 shares is to be distributed to shareholders, with no
bonus issue from either profit or capital reserves.
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 version shall prevail.
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China Merchants Port Group Co., Ltd. Annual Report 2020
Table of Contents
Chairman’s Statement..................................................................................................2
Part I Important Notes, Table of Contents and Definitions..................................... 8
Part II Corporate Information and Key Financial Information...........................12
Part III Business Summary........................................................................................19
Part IV Operating Performance Discussion and Analysis.....................................25
Part V Significant Events........................................................................................... 60
Part VI Share Changes and Shareholder Information.........................................103
Part VII Preferred Shares........................................................................................ 113
Part VIII Convertible Corporate Bonds.................................................................114
Part IX Directors, Supervisors, Senior Management and Staff.......................... 115
Part X Corporate Governance................................................................................ 134
Part XI Corporate Bonds.........................................................................................152
Part XII Financial Statements (See attached)....................................................... 157
Part XIII Documents Available for Reference.......................................................158
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China Merchants Port Group Co., Ltd. Annual Report 2020
Definitions
Term Definition
China Merchants Port Group Co., Ltd., formerly known as “Shenzhen Chiwan
The “Company”, “CMPort” or “we”
Wharf Holdings Limited”
Shenzhen Chiwan Wharf Holdings Limited (stock name: Chiwan Wharf/
Chiwan Wharf
Chiwan Wharf-B; stock code: 000022/200022)
CMG China Merchants Group Co., Limited
China Merchants Group (H.K.) Limited, a CMG wholly-owned subsidiary in
CMG Hong Kong
Hong Kong
CMPID China Merchants Port Investment Development Company Limited
CMPort Holdings China Merchants Port Holdings Company Limited (00144.HK)
Broadford Global Broadford Global Limited, a wholly-owned subsidiary of CMG Hong Kong
China Merchants Gangtong Development (Shenzhen) Co., Ltd., a Broadford
CMGD
Global majority-owned subsidiary in Shenzhen
CWH (H.K.) Chiwan Wharf Holdings (Hong Kong) Limited
Sinotrans Guangdong Sinotrans Guangdong Co., Ltd.
Zhanjiang Infrastructure Investment Zhanjiang Infrastructure Construction Investment Group Co., Ltd.
CND Group China Nanshan Development (Group) Inc.
CMB China Merchants Bank Co., Ltd.
CMSK China Merchants Shekou Industrial Zone Holdings Co., Ltd.
Malai Storage Shenzhen Malai Storage Co., Ltd.
CM Qianhai Industrial Shenzhen China Merchants Qianhai Industrial Development Co., Ltd.
CMI China Merchants Investment Limited
Liaoning Port Group Liaoning Port Group Co., Ltd.
SIPG Shanghai International Port (Group) Co., Ltd.
CMICT Ningbo Daxie China Merchants International Container Terminal Co., Ltd.
Ningbo Port Ningbo Zhoushan Port Company Limited
Zhangzhou Port Zhangzhou China Merchants Port Co., Ltd.
Shantou Port Shantou CMPort Group Co., Ltd.
Tianjin Port Container Terminal Tianjin Port Container Terminal Co., Ltd.
TICT Tin-Can Island Container Terminal Ltd.
CMA CMA CGM SA
TL Terminal Link S.A.S.
Zhanjiang Port Zhanjiang Port (Group) Co., Ltd.
Xiamen Port Zhangzhou China Merchants Xiamen Port Affairs Co., Ltd.
Chiwan Container Terminal Co., Ltd., a majority-owned subsidiary of the
CCT
Company
Kumport Kumport Liman Hizmetleri ve Lojistik Sanayi ve Ticaret Anonim Sirketi
Port of Newcastle Port of Newcastle
TCP TCP Participaes S.A
CICT Colombo International Container Terminals Ltd.
PDSA Port de Djibouti S.A.
HIPG Hambantota International Port Group
Cyber Chic Cyber Chic Company Limited
10
China Merchants Port Group Co., Ltd. Annual Report 2020
Haixing Harbor Shenzhen Haixing Harbor Development Co., Ltd.
Dalian Port Dalian Port (PDA) Company Limited
Shunde New Port Guangdong Yide Port Limited
China Merchants Northeast Asia Development Investment Co., Ltd. (tentative
Northeast Asia Investment
name, final name subject to the officially registered one)
Jinyu Rongtai Shenzhen Jinyu Rongtai Investment Development Co., Ltd.
China Merchants Venture China Merchants Venture Capital Management Co., Ltd.
China Merchants Venture Fund Shenzhen China Merchants Venture Capital Fund Center (Limited Partnership)
CMHIT China Merchants Holdings (International) Information Technology Co., Ltd.
Jifa Logistics Dalian Port Jifa Logistics Co., Ltd.
DPCD Dalian Port Container Development Co., Ltd.
Yingkou Port Group Yingkou Port Group Co., Ltd.
DPN Dalian Port Logistics Network Co., Ltd.
YPIT Yingkou Port Information Technology Co., Ltd.
CMHD China Merchants Holdings Djibouti
Orienture Holdings (Djibouti) FZE (tentative name, final name subject to the
OHD
officially registered one)
Djibouti New Co (tentative name, final name subject to the officially registered
DNC
one)
Red Sea World (tentative name, final name subject to the officially registered
RSW
one)
Chiwan Wharf’s purchase of 1,313,541,560 ordinary CMPort Holdings shares
The “Assets Purchase via Share Offering”
from CMID via share offering
State-Owned Assets Supervision and Administration Commission of the State
SASAC of the State Council
Council
CSRC China Securities Regulation Commission
Shenzhen CSRC Shenzhen Bureau of China Securities Regulatory Commission
SZSE Shenzhen Stock Exchange
The “Company Law” The Company Law of the People’s Republic of China
The “Securities Law” The Securities Law of the People’s Republic of China
The “Articles of Association” The Articles of Association of China Merchants Port Group Co., Ltd.
The “Stock Listing Rules” The Stock Listing Rules of the Shenzhen Stock Exchange
The cninfo website www.cninfo.com.cn
CM ePort The wharf e-commerce platform, i.e. the unified customer service platform
TEU Twenty Foot Equivalent Unit
Expressed in the Chinese currency of Renminbi
RMB
Expressed in tens of thousands of Renminbi
RMB’0,000
Expressed in hundreds of millions of Renminbi
RMB’00,000,000
(unless otherwise specified)
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China Merchants Port Group Co., Ltd. Annual Report 2020
Part II Corporate Information and Key Financial Information
I Corporate Information
CM Port Group/
Stock name Stock code 001872/201872
CM Port Group B
Stock exchange for stock listing Shenzhen Stock Exchange
Company name in Chinese 招商局港口集团股份有限公司
Abbr. 招商港口
Company name in English (if any) China Merchants Port Group Co., Ltd.
Abbr. (if any) CMPort
Legal representative Bai Jingtao
23-25/F, China Merchants Port Plaza, 1 Gongye 3rd Road, Zhaoshang
Registered address
Street, Nanshan, Shenzhen, PRC
Zip code 518067
23-25/F, China Merchants Port Plaza, 1 Gongye 3rd Road, Zhaoshang
Office address
Street, Nanshan, Shenzhen, PRC
Zip code 518067
Company website http://www.cmp1872.com
Email address Cmpir@cmhk.com
II Contact Information
Board Secretary Securities Representative
Name Li Yubin (Acting) Hu Jingjing
24/F, China Merchants Port Plaza, 1 24/F, China Merchants Port Plaza, 1
Address Gongye 3rd Road, Zhaoshang Street, Gongye 3rd Road, Zhaoshang Street,
Nanshan, Shenzhen, PRC Nanshan, Shenzhen, PRC
Tel. +86 755 26828888 +86 755 26828888
Fax +86 755 26886666 +86 755 26886666
Email address Cmpir@cmhk.com Cmpir@cmhk.com
III Media for Information Disclosure and Place where this Report Is Lodged
Newspapers designated by the Company for information Securities Times, Shanghai Securities News, Ta
disclosure Kung Pao
Website designated by CSRC for publication of this Report http://www.cninfo.com.cn
Place where this Report is lodged Board Office
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China Merchants Port Group Co., Ltd. Annual Report 2020
IV Change to Company Registered Information
Unified social credit code 91440300618832968J
On 14 December 2018, the Company changed its business scope registered with the
industrial and commercial administration. The new business scope includes:
construction, management and operation of ports and wharves; bonded warehousing
of various goods for import and export; development, construction and operation of
supporting parks in ports; loading, unloading, transshipment, warehousing and
transportation of international and domestic goods and processing of goods;
devanning and LCL operations, cleaning, repairing, manufacturing and leasing of
containers; international freight forwarding; vehicle and ship leasing; the provision
Change to principal of ship and port services including the provision of fuels, supplies and daily
activity of the Company necessities for ships; ship towing (no operation using foreign ships); leasing and
since going public (if
any) repair services of port facilities, equipment and machinery; import and export of
various goods and technologies on a self-operation or agency basis, excluding the
goods and technologies restricted or forbidden for import and export by the state;
port logistics and port information technology consulting services; technical
development and services in respect of modern logistics information systems; supply
chain management and related services; design of logistics plans; engineering project
management; development, research and consulting services in respect of port
engineering technologies. (In respect of any operations that require approval
according to law, the approval must be obtained before operation).
1. On 8 June 2018, as the ownership of 209,687,067 Chiwan Wharf shares formerly
held by CND Group and 161,190,933 Chiwan Wharf shares formerly held by Malai
Storage was officially transferred to CMGD, CMGD, holding 57.52% of the
Company’s outstanding share capital, became the controlling shareholder of the
Company. Meanwhile, CMG remains the actual controller of the Company.
Every change of
controlling shareholder 2. On 26 December 2018, the Company issued RMB-denominated ordinary shares
since incorporation (if (A-shares) at RMB21.46/share to CMPID for the acquisition of the 1,313,541,560
any)
CMPort Holdings ordinary shares that it held. Upon the Acquisition, the Company’s
total share capital has become 1,793,412,378 shares. Meanwhile, as Broadford
Global controls an 87.81% aggregated voting right in the Company (direct interests
and interests through CMPID and CMGD), it is the direct controlling shareholder of
the Company. Meanwhile, CMG remains the actual controller of the Company.
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China Merchants Port Group Co., Ltd. Annual Report 2020
V Other Information
The independent audit firm hired by the Company:
Name Deloitte Touche Tohmatsu Certified Public Accountants LLP
Office address 30/F, 222 Yan An Road East, Huangpu District, Shanghai, P.R.C.
Accountants writing
Li Weihua, Zhang Min
signatures
The independent sponsor hired by the Company to exercise constant supervision over the Company
in the Reporting Period:
□ Applicable √ Not applicable
The independent financial advisor hired by the Company to exercise constant supervision over the
Company in the Reporting Period:
□ Applicable √ Not applicable
VI Key Financial Information
Indicate by tick mark whether there is any retrospectively restated datum in the table below.
□ Applicable √ Not applicable
2020-over-
2020 2019 2018
2019 change
Operating revenue
12,618,529,996.02 12,123,829,423.74 4.08% 9,703,394,622.58
(RMB)
Net profit
attributable to the
listed company’s 2,065,322,969.66 2,898,192,168.84 -28.74% 1,090,418,910.77
shareholders
(RMB)
Net profit
attributable to the
listed company’s
shareholders 1,262,830,563.26 1,037,766,875.23 21.69% 516,155,803.81
before exceptional
gains and losses
(RMB)
Net cash generated 5,495,800,917.01 5,501,873,415.94 -0.11% 4,288,575,424.84
from/used in
14
China Merchants Port Group Co., Ltd. Annual Report 2020
operating activities
(RMB)
Basic earnings per
1.07 1.59 -32.70% 0.61
share (RMB/share)
Diluted earnings
per share 1.07 1.59 -32.70% 0.61
(RMB/share)
Weighted average
return on equity 5.66% 8.71% -3.05% 3.88%
(%)
Change of 31
December, 2020
31 December, 2020 31 December, 2019 over 31 31 December, 2018
December, 2019
(%)
Total assets
168,543,611,777.21 156,696,917,845.87 7.56% 128,018,084,415.68
(RMB)
Equity attributable
to the listed
company’s 37,117,806,052.18 35,972,804,419.42 3.18% 30,760,475,412.93
shareholders
(RMB)
Indicate by tick mark whether the lower of the net profit attributable to the listed company’s
shareholders before and after exceptional gains and losses was negative for the last three accounting
years, and the latest independent auditor’s report indicated that there was uncertainty about the
Company’s ability to continue as a going concern.
□ Yes √ No
Indicate by tick mark whether the lower of the net profit attributable to the listed company’s
shareholders before and after exceptional gains and losses was negative.
□ Yes √ No
VII Accounting Data Differences under China’s Accounting Standards for Business
Enterprises (CAS) and International Financial Reporting Standards (IFRS) and Foreign
Accounting Standards
1. Net Profit and Equity under CAS and IFRS
□ Applicable √ Not applicable
No difference for the Reporting Period.
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China Merchants Port Group Co., Ltd. Annual Report 2020
2. Net Profit and Equity under CAS and Foreign Accounting Standards
□ Applicable √ Not applicable
No difference for the Reporting Period.
3. Reasons for Accounting Data Differences between Domestics and Foreign Accounting
Principle: Not applicable
VIII Key Financial Information by Quarter
Unit: RMB
Q1 Q2 Q3 Q4
Operating revenue 2,886,025,618.74 3,036,471,539.74 3,239,264,119.14 3,456,768,718.40
Net profit attributable to the
listed company’s 149,871,785.99 482,926,799.84 642,339,845.93 790,184,537.90
shareholders
Net profit attributable to the
listed company’s
199,867,940.76 344,723,973.78 605,513,230.59 112,725,418.13
shareholders before
exceptional gains and losses
Net cash generated
from/used in operating 847,165,371.60 1,224,260,773.32 1,665,387,875.49 1,758,986,896.60
activities
Indicate by tick mark whether any of the quarterly financial data in the table above or their
summations differs materially from what have been disclosed in the Company’s quarterly or
semiyearly reports.
□ Yes √ No
IX Exceptional Gains and Losses
Unit: RMB
Item 2020 2019 2018 Note
Gain or loss on disposal of
non-current assets (inclusive
1,480,572,929.90 4,794,562,782.79 6,512,480.64 -
of impairment allowance
write-offs)
Government subsidies
charged to current profit or
loss (exclusive of government
subsidies given in the 238,216,977.76 162,587,042.38 14,050,544.16 -
Company’s ordinary course of
business at fixed quotas or
amounts as per the
government’s uniform
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China Merchants Port Group Co., Ltd. Annual Report 2020
standards)
Capital occupation charges on
non-financial enterprises that
232,906,880.87 19,571,040.36 - -
are charged to current profit or
loss
Current profit or loss on
subsidiaries obtained in
business combinations
involving enterprises under - - 2,685,592,888.44 -
common control from the
period-beginning to
combination dates, net
Gain or loss on fair-value
changes in held-for-trading
and derivative financial assets
and liabilities & income from
disposal of held-for-trading
and derivative financial assets
-409,658,173.58 66,075,363.30 - -
and liabilities and other
investments in debt
obligations (exclusive of the
effective portion of hedges
that arise in the Company’s
ordinary course of business)
Reversed portions of
impairment allowances for
accounts receivable and
46,709,066.77 - - -
contract assets which are
tested individually for
impairment
Custodian fees earned from
1,886,792.45 - - -
entrusted operation
Non-operating income and
-42,615,710.20 482,165,418.73 -3,767,817.73 -
expense other than the above
Gain resulted
from
revaluation to
the fair value
of the
Other gains and losses that
original
meet the definition of 753,988,749.80 732,644,357.06 -121,311,211.59
holding
exceptional gain/loss
shares of
CMICT due
to the
acquisition in
2020
Less: Income tax effects 241,651,237.66 1,504,203,995.96 3,010,149.89 -
Non-controlling
1,257,863,869.71 2,892,976,715.05 2,003,803,627.07 -
interests effects (net of tax)
Total 802,492,406.40 1,860,425,293.61 574,263,106.96 --
Explanation of why the Company reclassifies recurrent gain/loss as an exceptional gain/loss item
defined or listed in the Explanatory Announcement No. 1 on Information Disclosure for Companies
17
China Merchants Port Group Co., Ltd. Annual Report 2020
Offering Their Securities to the Public—Exceptional Gain/Loss Items:
□ Applicable √ Not applicable
No such cases for the Reporting Period.
18
China Merchants Port Group Co., Ltd. Annual Report 2020
Part III Business Summary
I Principal Activity of the Company in the Reporting Period
1. Main business scope and business models
The Company is principally engaged in the handling, warehousing and transportation of containers
and bulk cargoes, as well as the provision of other ancillary services. It principally operates 24
container berths and 18 bulk cargo berths in the ports in West Shenzhen and Dongguan Machong, 9
container berths, 2 bulk cargo berths, 10 general cargo berths, and 1 coal-handling specific berth in
Shantou Port, 2 container berths and 33 bulk cargo berths in Zhanjiang Port, 4 multi-purpose berths
in Shunde Port, 2 container berths and 6 bulk cargo berths in Zhangzhou Port, 4 container berths in
Ningbo Daxie, 4 container berths in CICT, Sri Lanka, 4 multi-purpose berths, 2 oil berths and 4
container berths in HIPG, Sri Lanka, 3 container berths in LCT, Togo, and 4 container berths in
TCP, Brazil. Moreover, the Company invests in container hubs in Shanghai and Tianjin and
expands its layout to ports in Asia, Africa, Europe, Oceania, South America and North America.
The major business segments of China Merchants Port Group Co., Ltd. are as follows:
Business Segments Applications
Container handling and warehousing: the Company provides ship berthing, loading
and discharging services to ship companies, offers container storage service to ship
companies and cargo owners and provides overhead box services to tractor
companies. The Company also engages in the businesses of division or merger of
Cargo handling
and warehousing cargoes in containers, container leasing and container maintenance;
Bulk cargo handling and warehousing: the Company is engaged in bulk cargo
handling and transportation in port zones, as well as storage services in yards. The
major types of cargoes handled include food, steel, woods and sandstones.
The ancillary port-related services of the Company mainly include tugboat berthing
Ancillary port- assistance and barge services at the arrival of ships to the ports, tallying in the course
related services
of cargo handling, and supply of shore power and freshwater for vessels.
Bonded logistics The Company provides various services for clients (including logistics companies,
operations trading companies or cargo owners), for example, warehouse/yard leasing, loading
19
China Merchants Port Group Co., Ltd. Annual Report 2020
and unloading in warehouses/yards, customs clearance and division or merger of
cargoes at terminals. It also provides documentation services for tractors arriving or
leaving the bonded logistics parks.
2. Development stage and cyclical characteristic of the industry in which the Company
operates and its industry position during the reporting period
The port industry is a crucial cornerstone industry for national economic and social development,
and is closely linked to global economy and trade. In 2020, as the COVID-19 pandemic spread
across the world, the global economy took a heavy hit, resulting in a complex and unfavorable
international political and economic landscape. In the first half of the year, the shrinking seaborne
freight volume of global container throughput, due to the pandemic, posed challenges to port
production. During the second half of the year, most of the countries reopened their economy, so
the port and shipping market began to recover. With the full resumption of operation and production
in China, import and export rebounded by degrees and domestic port production grew steadily. The
pandemic has also accelerated the digitalization of the port and shipping industry, which will bring
new development opportunities for cost reduction, efficiency enhancement and innovation in the
business model.
The Company is the largest port developer, investor and operator in the PRC and the leading
comprehensive port service provider in the world, with a well-developed port network at major hub
locations along coastal China. It has also successfully established presences in Asia, Africa, Europe,
Mediterranean, Oceania, South America and North America. By its proactive, sound and efficient
operating style, the Company capitalizes on its global port portfolio, professional management
experience, the self-developed state-of-the-art terminal operation system and integrated logistics
management platform for exports and imports, thereby providing its customers with timely and
efficient port and maritime logistics services along with comprehensive and modern integrated
logistics solutions. In addition, the Company also invests in bonded logistics operation and launches
integrated park development business, facilitates the transformation and upgrade of port industry,
20
China Merchants Port Group Co., Ltd. Annual Report 2020
develops comprehensive port services, increases its industry competitiveness, and creates greater
value through the synergies of the existing terminal network.
II Significant Changes in Major Assets
1. Significant Changes in Major Assets
Major assets Main reason for significant changes
Equity
No significant change
assets
Fixed assets No significant change
Intangible
No significant change
assets
Construction
No significant change
in progress
2. Major Assets Overseas
Control Return As % of the Material
Asset value Locatio measures to generated Company’s impairment
Asset Source Operations
(RMB’0,000) n protect (RMB’0,00 net asset risk
asset safety 0) value (yes/no)
Appointing
Port director,
Acquired
Equity Hong investment supervisor
via share 14,005,085.57 506,441.23 87.92% No
assets Kong and and senior
offering
operations manageme
nt
Other
N/A
information
III. Core competitiveness analysis
1. Commitment to the development pattern of the global industrial chain and the national
“Belt and Road” cooperation initiative to build and capability to allocate and operate its
global port network.
As an important carrier for domestic and overseas port investment and operation of CMG, the
Company gained in-depth insight into the current states, trends and driving factors of the global
industrial chain. Based on the insight, it followed the development pattern of the global industrial
chain and seized the significant policy opportunities arising from the key “Belt and Road” initiative
21
China Merchants Port Group Co., Ltd. Annual Report 2020
and the building of the Guangdong-Hong Kong-Macao Greater Bay Area to actively build a global
port network and arrange for the investment and allocation of global resources.
In recent years, through mergers, acquisitions, restructuration, renovation of old ports, and building
of new ports, the Company has been consistently improving its modern port chain with global
coverage, enhancing the value of the port industry, and pushing forward balanced regional
development. Leveraging the West Shenzhen homebase port, the Company provided a
comprehensive and integrated logistic service platform for the development of the Guangdong-
Hong Kong-Macao Greater Bay Area. After years of overseas development, CMPort has extended
the port and park-related business across Southeast Asia, South Asia, Africa, Europe, Oceania, etc.
Its port network comprises 50 ports which are located in 26 countries and regions on six continents.
Adhering to the principle of “extensive consultation, joint development and shared benefits”,
CMPort has developed local-based business operation and formed a community of shared future
with stakeholders from countries and regions along the “Belt and Road” initiative to explore
development opportunities with concerted efforts. At the same time, the diversified investment and
operation of port assets at home and abroad have also effectively enhanced its capabilities of
resisting risks of industry fluctuations, trade fictions and unexpected events.
2. Centering on end customers, developing comprehensive logistics service, securing the safety
of the global supply chain for Chinese enterprises.
The Company aims at increasing its global presence with shipping routes across five continents. As
both the shipping and port sectors gradually shifted to forming alliances, the Company actively
integrated its domestic and overseas port assets and capitalized on its relatively complete global port
network to provide more comprehensive and effective integrated logistics service solutions for the
global supply chain to satisfy customer needs, forming its unique competitive strength. Based on
the West Shenzhen homebase port and the Shunde New Port, it built the first complex port in the
Greater Bay Area to meet the unsatisfied customer needs, promoting the development of the
Guangdong-Hong Kong-Macao Greater Bay Area. While safeguarding the global industrial chain
for Chinese industrial enterprises, it also secured supply for people’s livelihood in the country
through the import and domestic trade business, thereby accelerating the formation of China’s new
development pattern, the domestic economic cycle as the mainstay and the domestic and
international economic cycles boosting each other.
22
China Merchants Port Group Co., Ltd. Annual Report 2020
3. Long history and sound shareholder background
Established in 1872, which is 149 years ago, CMG has become an exemplary model for Chinese
enterprises and developed strong brand power. It is also a key state-owned enterprise under the
direct administration of the PRC central government. Headquartered in Hong Kong, CMG is an
integrated enterprise with diversified businesses and one of the four major Chinese enterprises in
Hong Kong. Currently, it is mainly engaged in three core industries namely transportation, finance,
and real estate, while focusing on four key sectors including infrastructure and equipment
manufacturing, logistics and shipping, integrated finance, and comprehensive development of cities
and parks. CMG has been rated as a Grade A enterprise in the Operating Results Assessment of the
State-owned Assets Supervision and Administration Commission of the State Council for 16
consecutive years and is a central state-owned enterprise that owns two Fortune 500 companies.
Being a crucial player and facilitator of the national “Belt and Road” initiative, CMG has
accelerated its international development and preliminarily formed a relatively complete network of
overseas ports, logistics, finance, and park business. The sound shareholder background and ample
domestic and overseas resources of CMG have provided strong support to CMPort for constructing
a global port cooperation platform with international vision and global expansion capabilities and
ultimately becoming a world-class comprehensive port service provider.
4. Innovative development and identification of and adaptation to changes
To maximize return for shareholders, the Company strived for “technology-led and innovation-
driven” growth philosophy. Through in-depth industry researches and analysis of management,
model and technology development trend, it gains insights into changing customer demands and
meets future challenges with innovative development.
Taking port business as the core and leveraging the synergy of different port zones as well as city-
industry integration, the Company is actively exploring and facilitating the comprehensive port
development model of “Port-Park-City”. Based on the traditional loading and discharging and
ancillary services at ports, it established the comprehensive development model that offered high
value-added services to enterprises. By gathering talents, data, funds and commodities, the
Company provided economic support for urban development, continued to innovate industry
development model, and expanded regional coverage and influence, thereby driving urban upgrade
and development. Currently, the Company has participated in promoting the port-oriented regional
23
China Merchants Port Group Co., Ltd. Annual Report 2020
comprehensive development and construction in various overseas regions and has achieved phased
progresses. At the same time, the innovative business development model introduces the elements
of China Merchants to urban development and helps foster new profit growth points for the
Company. In response to current development needs, the Company has launched the intelligence-
integrated comprehensive port services. The nine major intelligent elements of the Mawan
Intelligent Port have been shaped into intelligence-integrated products available for duplication and
promotion. Meanwhile, the Company has been developing an intelligence management platform to
ensure its internal management up to date. During the pandemic, its innovation platform and
technology application achieved notable breakthroughs.
5. Extensive experience in professional port management with sound and efficient operating
style
Adhering to the proactive, sound and efficient operating style and benefiting from its global port
assets and resources portfolio, the Company is committed to providing customers with timely and
efficient port and maritime logistics services as well as professional and first-class solutions, and
has become the preferred partner for customers and an important gateway for the country’s foreign
trade, thereby making due contributions to the country’s foreign trade development. At the same
time, the Company also made an extensive investment in bonded logistics business to expand its
port value chain and enhance industrial value. Taking advantages of the synergy of its existing
terminal network, the Company created values for both its customers and shareholders.
The Company has earned itself good reputation across the industry by its professional management
experience accumulated for years, its self-developed global leading terminal operating system and
integrated logistics management platform for import and export, its extensive maritime logistics
support system with all-rounded modern integrated logistics solutions, and its high-quality
engineering management and reliable service offerings.
24
China Merchants Port Group Co., Ltd. Annual Report 2020
Part IV Operating Performance Discussion and Analysis
I Overview
1. External Environment Analysis
(1) Macroeconomic environment
In 2020, the increasingly complex international environment was characterized by the significant
increase in uncertainties and the far-reaching and unprecedented impact brought by COVID-19.
According to the “World Economic Outlook” report published by the International Monetary Fund
in January 2021, the global economy is expected to shrink by 3.5% year-on-year in 2020.
Developed economies and emerging economies are expected to decline by 4.9% and 2.4%
respectively, while the America and Eurozone economies are expected to record a decrease of 3.4%
and 7.2% respectively due to the severe impact from COVID-19 pandemic. The COVID-19
pandemic started to spread across East and Southeast Asia in early 2020. Since the second quarter,
America and Europe have become the pandemic epicenters and witnessed the second and third
waves of the outbreak, posing serious challenges to global economic recovery. Facing the
complicated and difficult international environment, China organized and promoted pandemic
prevention and control along with economic and social development. Its efforts not only effectively
facilitated the restoration of normal production and everyday life, but also yielded significant
strategic achievements in disease prevention and control. In the meantime, China accelerated the
establishment of the new development pattern in which the domestic economic cycle is the
mainstay and the domestic and international economic cycles boost each other. As a result, the
national economy recovered steadily and recorded an annual GDP growth of 2.3% in 2020, making
China the only major economy with positive economic growth in the world. In the second half of
2020, the infrastructure constructions, along with other fixed asset investments, provided greater
supports to economy recovery and China recorded better-than-expected growth in foreign trade
driven by regional trade and cooperation. Consumption demand gradually picked up and the
economy showed positive signs of recovery. Overall, China’s economy maintained its upward trend
in the long-run. To achieve high-quality economic growth, China will intensify the supply-side
25
China Merchants Port Group Co., Ltd. Annual Report 2020
restructuring and pay attention to demand-side management in the meantime. According to the
statistics published by the General Administration of Customs, China’s total import and export
value amounted to RMB32.16 trillion in 2020, representing an increase of 1.9% year-on-year.
Among which, the export value was RMB17.93 trillion, representing an increase of 4.0% year-on-
year, while the import value was RMB14.23 trillion, representing a decrease of 0.7% year-on-year.
Trade surplus amounted to RMB3.7 trillion, representing an increase of 27.4% year-on-year.
(2) Market environment of the port and shipping industry
In 2020, the global container shipping market suffered from volatile demand. During the first half
of the year, the container shipping market was severely impacted by the pandemic, which resulted
in the idling of shipping capacity to a certain extent. In the second half of the year, various countries
implemented economic stimulus policies and commerce demand rebounded. These factors, coupled
with high demand in traditional peak season and the shortage of containers, led to ongoing strong
demand in the container shipping market and the utilization of idle capacity in a gradual pace. The
significant improvement in business performances of shipping companies in general was driven by
rising freight rates.
The COVID-19 pandemic led to the decline in global port container throughput in 2020. According
to data from Alphaliner, the global container port throughput amounted to 827 million TEUs in
2020, down by 1.4% year-on-year. Benefiting from the success in domestic pandemic prevention
and control, China’s import and export for foreign trade stabilized rapidly and continued to grow,
while the domestic port production maintained an upward trend in general. According to the
information published by the Ministry of Transport of the People’s Republic of China, the
accumulated port container throughput in China amounted to 264 million TEUs in 2020,
representing a year-on-year increase of 1.2%.
2. Port Business Review
(1) Overview of port business
In 2020, the Company’s ports handled a total container throughput of 121.71 million TEUs, up by
7.8% year-on-year. Bulk cargo volume handled by the Company’s ports decreased by 7.1% year-
on-year to 450 million tons. During the Reporting Period, operating revenue of the Company
amounted to RMB12.619 billion, representing a year-on-year increase of 4.08%.
Table 4-1 Throughput of the Company and changes in 2020
Item 2020 2019 Changes
Container throughput (’0,000 TEU) 12,171 11,293 7.8%
Among which: Mainland China 8,576 8,488 1.0%
26
China Merchants Port Group Co., Ltd. Annual Report 2020
Hong Kong and Taiwan 716 721 -0.7%
Overseas 2,878 2,084 38.1%
Bulk cargo throughput (hundred
4.5 4.9 -7.1%
million tonnes)
Among which: Mainland China 4.48 4.83 -7.1%
Overseas 0.058 0.063 -7.2%
Note: 1. The statistics represented the total throughput of the holding subsidiaries, associates
and joint ventures of the Company. 2. Discrepancies between totals and sums of sub-items listed are
due to rounding.
For container business, the Company’s ports in China handled container throughput of 85.76
million TEUs, representing a year-on-year increase of 1.0%. Ports in Hong Kong and Taiwan
regions contributed total container throughput of 7.16 million TEUs, indicating a decrease of 0.7%
year-on-year. The total container throughput handled by the Company’s overseas ports grew by
38.1% year-on-year to 28.78 million TEUs, mainly benefiting from the inclusion of the eight newly
acquired terminals by TL and the business growth of LCT in Togo and TCP in Brazil. In terms of
bulk cargo business, the Company’s ports in Mainland China handled a bulk cargo volume of 448
million tons, down 7.1% year-on-year. Overseas ports handled a bulk cargo volume of 5.83 million
tons, down 7.2% year-on-year, mainly due to the decrease in throughput at PDSA in Djibouti and
Kumport in Turkey.
(2) Operation condition of port business by region
Table 4-2 Container throughput of the Company and changes in 2020
(in ’0,000 TEU)
Region and port company 2020 2019 Changes
West Shenzhen Port
Holding 1,184 1,142 3.6%
Zone
company
Pearl River Shunde New Port 43 30 44.1%
Delta
Joint stock Chu Kong River Trade
106 109 -3.4%
company Terminal
Yangtze River Joint stock
SIPG Group 4350 4,330 0.5%
Delta company
27
China Merchants Port Group Co., Ltd. Annual Report 2020
Holding
Ningbo Daxie 332 329 0.9%
company
Tianjin Port Container
787 447 75.8%
Terminal
Joint stock
Bohai Rim
company
QQCTU 810 792 2.2%
Dalian Port 654 1,022 -36.0%
Zhangzhou Port 32 42 -25.4%
South-East
Holding
region of
company Shantou Port 159 134 18.9%
Mainland China
South-West
Holding
region of Zhanjiang Port 122 111 10.1%
company
Mainland China
Holding
company/ CMCS/
556 557 -0.2%
Joint stock Modern Terminals
Hong Kong and company
Taiwan
Joint stock Taiwan Kao Ming
160 164 -2.2%
company Container
CICT 293 288 1.9%
Holding
TCP 98 92 7.4%
company
LCT 136 113 20.5%
Overseas TL 2113 1,325 59.4%
Joint stock Kumport 122 128 -5.1%
company PDSA 86 92 -6.3%
TICT 30 47 -35.3%
Total 12,171 11,293 7.8%
Note: 1. Due to the restructuring of Tianjin Five Continents International Container Terminal
Co., Ltd., a former joint stock company of the Company, the Company has adjusted the statistical
caliber of Tianjin Port Container Terminal and included it in the statistics since September 2019; 2.
Since April 2020, the Company has newly included the business volume of eight new terminals
28
China Merchants Port Group Co., Ltd. Annual Report 2020
acquired by TL, a joint stock company of the Company; 3. Discrepancies between totals and sums
of sub-items listed are due to rounding.
Table 4-3 Bulk cargo volume handled by the Company and changes in 2020
(in ’0,000 tonnes)
Region and port company 2020 2019 Changes
West Shenzhen Port
1,807 1,300 39.0%
Zone
Holding
Pearl River company Dongguan Machong 1,548 1,227 26.2%
Delta Shunde New Port 395 226 74.4%
Joint stock Chu Kong River Trade
308 353 -12.8%
company Terminal
Yangtze River Joint stock
SIPG Group 7,565 11,515 -34.3%
Delta company
QQTU 1,629 1,559 4.5%
Qingdao Port
6,315 5,990 5.4%
Joint stock Dongjiakou
Bohai Rim
company Dalian Port 13,124 13,204 -0.6%
Laizhou Harbour
2,056 2,272 -9.5%
Affairs
Zhangzhou Port 633 814 -22.3%
South-East
Holding Xia Men Bay
region of 65 27 137.7%
company Terminals
Mainland China
Shantou Port 314 709 -55.7%
South-West
Holding
region of Zhanjiang Port 9,087 9,117 -0.3%
company
Mainland China
Holding
HIPG 124 50 145.6%
company
Overseas Kumport 7 10 -35.9%
Joint stock
company PDSA 453 568 -20.2%
Total 45,430 48,908 -7.1%
Note: 1. HIPG has included liquid bulk cargo in the statistics of its business volume since 2020;
2. Discrepancies between totals and sums of sub-items listed are due to rounding.
Pearl River Delta region
The Company’s terminals in West Shenzhen Port Zone handled a total container throughput of
11.84 million TEUs, up by 3.6% year-on-year. Bulk cargo volume handled amounted to 18.07
29
China Merchants Port Group Co., Ltd. Annual Report 2020
million tons, up by 39.0% year-on-year. Chu Kong River Trade Terminal handled a total container
throughput of 1.06 million TEUs and a bulk cargo volume of 3.08 million tons, down by 3.4% and
12.8% year-on-year respectively, mainly due to the suspension of certain foreign trade routes
affected by the pandemic. Dongguan Machong Terminal handled bulk cargo volume of 15.48
million tons, up by 26.2% year-on-year, mainly due to the significant increase in imported grains in
the region. Guangdong Yide Port Limited (Shunde New Port) handled a container throughput of
0.43 million TEUs, up by 44.1% year-on-year, mainly due to the steady increase in foreign trade
volume with the commencement of foreign trade business since July 2019. It also handled a bulk
cargo volume of 3.95 million tons, up by 74.4% year-on-year, mainly due to further market
expansion.
Yangtze River Delta region
SIPG handled a container throughput of 43.50 million TEUs, up by 0.5% year-on-year. Bulk cargo
volume handled declined by 34.3% year-on-year to 75.65 million tons because of the impact of the
pandemic and adjustment of business structure. Ningbo Daxie China Merchants International
Terminals Co., Ltd. (Ningbo Daxie) handled a container throughput of 3.32 million TEUs,
representing an increase of 0.9% year-on-year.
Bohai Rim region
Qingdao Qianwan United Container Terminal Co., Ltd. (QQCTU) handled a container throughput
of 8.10 million TEUs, representing an increase of 2.2% year-on-year. Qingdao Qianwan West Port
United Terminal Co., Ltd. (QQTU) handled a bulk cargo volume of 16.29 million tons, representing
an increase of 4.5% year-on-year. Because the rising domestic demand for iron ore led to the
increase in the foreign trade volume of iron ore, Qingdao Port Dongjiakou Ore Terminal Co., Ltd.
handled a bulk cargo volume of 63.15 million tons, indicating an increase of 5.4% year-on-year.
Dalian Port (PDA) Company Limited handled a container throughput of 6.54 million TEUs,
representing a decrease of 36.0% year-on-year, mainly due to the impact of the pandemic and
adjustment of business structure. Bulk cargo volume handled decreased by 0.6% year-on-year to
131 million tons. Due to intensifying regional competition and environmental policy, Laizhou
Harbour Affairs handled a bulk cargo volume of 20.56 million tons, representing a year-on-year
decrease of 9.5%. Since the Company participated in the merger of container terminals in Tianjin
30
China Merchants Port Group Co., Ltd. Annual Report 2020
which was completed in August 2019, Tianjin Port Container Terminal Co., Ltd. contributed a
container throughput of 7.87 million TEUs, representing a year-on-year increase of 75.8%.
South-East region of Mainland China
Zhangzhou China Merchants Port Co., Ltd. (“Zhangzhou Port”) handled a container throughput of
0.32 million TEUs, decreased by 25.4% year-on-year, while its bulk cargo volume handled
decreased by 22.3% year-on-year to 6.33 million tons, which is mainly affected by the pandemic
and the environmental policies in the hinterland. Since May 2019, Xia Men Bay China Merchants
Terminals Co., Ltd. (Xia Men Bay Terminals) has initiated its official operation and handled a bulk
cargo volume of 0.65 million tons, up by 137.7% year-on-year. Shantou China Merchants Port
Group Co., Ltd. handled a container throughput of 1.59 million TEUs, up by 18.9% year-on-year,
mainly due to the growth in the volume of domestic trade containers and a bulk cargo volume of
3.14 million tons, down by 55.7% year-on-year, dragged down by the impact of local environmental
policies and the vacation of old ports.
South-West region of Mainland China
Zhanjiang Port (Group) Co., Ltd. handled a container throughput of 1.22 million TEUs, up by
10.1% year-on-year, mainly attributable to the expansion of new shipping routes and the new
domestic transshipment business. It also handled a bulk cargo volume of 90.87 million tons, down
by 0.3% year-on-year.
Hong Kong and Taiwan regions
Modern Terminals Limited and China Merchants Container Services Limited in Hong Kong
delivered an aggregate container throughput of 5.56 million TEUs, down by 0.2% year-on-year.
Kao Ming Container Terminal Corp. in Kaohsiung, China Taiwan, handled a total container
throughput of 1.60 million TEUs, representing a decrease of 2.2% year-on-year.
Overseas operation
In Sri Lanka, CICT handled a container throughput of 2.93 million TEUs, up by 1.9% year-on-year;
the bulk cargo volume handled by HIPG was 1.24 million tons, increased by 145.6% year-on-year,
mainly due to the growth in cement business in the second half of the year. Its RO-RO volume was
0.375 million vehicles, down by 8.5% year-on-year, mainly due to the pandemic, the suspension of
automobile production in Indian factories, and decline in the local vehicle imported. Container
31
China Merchants Port Group Co., Ltd. Annual Report 2020
throughput handled by LCT in Togo increased by 20.5% year-on-year to 1.36 million TEUs, which
was mainly due to the transfer of some transshipment routes from regions seriously impacted by the
pandemic to LCT in Togo by shipping companies. Container throughput handled by TICT in
Nigeria was 0.30 million TEUs, representing a decrease of 35.3% year-on-year, mainly due to the
decrease in import demand affected by the pandemic and the drop of oil prices. Given the declining
import and export demand in the hinterland, PDSA in Djibouti handled a container throughput of
0.86 million TEUs, down by 6.3% year-on-year, and a bulk cargo volume of 4.53 million tons,
down by 20.2% year-on-year. TL handled a container throughput of 21.13 million TEUs, up by
59.4% year-on-year, which was mainly benefitted from the container throughput handled by the
new eight ports whose acquisition was completed in March 2020. Container throughput handled by
Kumport in Turkey was 1.22 million TEUs, representing a decrease of 5.1% year-on-year; while
bulk cargo volume handled was 70 thousand tons, down by 35.9% year-on-year, which was mainly
due to the decline of marble exports affected by the pandemic. Benefitted from the increase in
import and export container volume driven by the growth in the trade of agricultural and meat
products, TCP in Brazil handled a container throughput of 0.98 million TEUs, up by 7.4% year-on-
year.
3. Implementation of business plan during the reporting period
During the Reporting Period, the Company continued to pursue its strategic focus. It adhered to the
strategic directives and the general operation philosophy of “enhancing core capability, insisting on
both quality and efficiency, capitalizing on opportunities of this era, and striving to become a
world’s leading enterprise” with an unwavering aspiration to reinforce its foundation and made
innovation with a pragmatic attitude. Striving to achieve breakthroughs in seven key aspects,
namely the building of homebase ports, business expansion, innovative development,
comprehensive development, operation management, capital operation, and marketing and
commerce, the Company actively implemented various key tasks and maintained steady growth in
all business segments in 2020.
In terms of the development of homebase ports, the Company accelerated the building of world-
class ports in line with the national “Outline for the Construction of a Strong Transportation
Country” and the “Guiding Opinions on the Construction of World-Class Ports” promulgated by
32
China Merchants Port Group Co., Ltd. Annual Report 2020
nine Chinese ministries. Closely following the national development strategy of Guangdong-
Hong Kong-Macao Greater Bay Area. West Shenzhen Port Zone promoted high-value-added
business with routes and supply chain resources and pushed forward the launch of regular night
service along the Tonggu Channel as soon as possible to enhance its navigation capacity and
competitiveness. As for Mawan Intelligent Port, two berths, each with a capacity of 200,000 tons,
would be in place after the construction is completed, and one of the berths was delivered and
accepted on 26 August, 2020. The Company will continue to develop, at full stretch, West Shenzhen
Port Zone into an international leading intelligent port in Guangdong-Hong Kong-Macao Greater
Bay Area and the world. In terms of the development of overseas homebase ports, CICT and HIPG
adopted a market-oriented approach to enhance service capability and expand value-added services.
They strengthened the sound momentum of growth, deepened business synergy and collaboration,
improved overall planning, and established cooperation with the port segment of major shipping
companies, thereby facilitating industry development and boosting regional influence.
In respect of business expansion, the Company completed the acquisition of equity interests in 8 out
of 10 target terminals through TL, which is the associate company of the Company, on 26 March
2020. After completion of the investments, the Company expanded its port business into Southeast
Asia, Middle East, Europe, Middle East, and the Caribbean, which further optimized its global port
network.
In pursuit of innovative development, the Company proactively supported the construction of
intelligent ports and the port ecosystem. As to the intelligent port development, the first berth of the
Mawan Intelligent Port construction project has been delivered and accepted, and has become the
first automated container terminal upgraded and transformed from a traditional multi-purpose
terminal in China. The project embodied smart technology, social and economic contributions by
incorporating nine major intelligent elements, namely “CM Chip”, “CM ePort”, artificial
intelligence, 5G network application, Beidou system, automation, intelligent ports, blockchain, and
green and low-carbon development. It was recognized as a key research and development project by
the Ministry of Science and Technology and would be developed into a model for intelligence
upgrade of traditional terminals at home and abroad. In terms of service expansion, the Company
creatively developed the complex port in the Guangdong-Hong Kong-Macao Greater Bay Area. By
33
China Merchants Port Group Co., Ltd. Annual Report 2020
combining blockchain, big data, artificial intelligence, and cloud computing, it established the
customs and logistics platform for the Greater Bay Area via technology empowerment, so as to
promote the healthy and sustainable growth of cross-border trade in the region. For the incubation
of business innovation, the Company took initiative to cooperate with leading Internet technology
companies to explore the establishment of the open intelligent port platform. Regarding the
integration between industry and finance, it invested and established China Merchants Port
(Shenzhen) Industrial Innovation Private Equity Investment Fund (招商港口（深圳）产业创新私
募股权投资基金) in collaboration with China Merchants Venture, the fund of which will capitalize
on the integration between the industrial and the financial sector to promote technological
innovation and transformation, and then optimize the industry ecosystem.
In terms of comprehensive development, the Company took a key step forward in the
implementation of the PPC model. Focusing on the Djibouti Zone and the HIPG Zone in Sri Lanka,
it further improved the international network layout and the synergy among overseas businesses.
Until the end of 2020, HIPG industrial park and Djibouti International Free Trade Zone have
entered into contracts with 26 and 114 enterprise tenants, respectively. Despite the adverse impact
of the pandemic, it made great progress in the introduction of business and investment.
In terms of operation management, the Company, guided by “empowerment, professionalism and
value” and surrounded by five core elements, namely “management standard, professional team,
closed-loop procedure, information system and benchmark enhancement”, established an operation
management system with sustainable value creation, gradually formulated standards for all
functional modules, and managed to build a world-class value-oriented headquarters. Taking into
account the strategic positioning of its various business segments, the Company, adhering to the
principles of differentiation and controllable risks and pushing forward full-cycle asset management,
procurement management, and performance evaluation mechanism, continuously promoted the
healthy development of its subsidiaries. Besides, focusing on execution quality, the Company
intensified the tasks on quality and efficiency improvement and strived to implement related
measures to achieve in-depth integration between quality and efficiency improvement and strategic
objectives.
34
China Merchants Port Group Co., Ltd. Annual Report 2020
In terms of capital operation, the Company promoted regularized dual-platform capital operation
and adhered to the working concept of revitalizing existing assets and optimizing asset structure. It
introduced Fujian Transportation Maritime Silk Road Investment and Management Co. Limited (福
建省交通海丝投资管理有限公司) as the strategic investor of HIPG, with a view to tapping into
synergy by optimizing the asset profile and the corporate governance structure. Following its
strategic goals, it utilized the dual platform and realized growth in asset size and profit volume
through consolidating the financial statements of Ningbo Daxie and optimizing the tax structure and
liability management.
In terms of marketing and commerce, the Company continued to organize and make plans of
business promotion and marketing campaigns for domestic and international customers. During the
pandemic, it maintained proactive communication with customers to ensure smooth business
operation. Leveraging its terminal resources across Northern and Southern China, it optimized the
route network and built the boutique shipping routes. It also participated in major events such as the
China International Import Expo and the China Marine Economy Expo to build the brand image of
CMPort.
II Core Business Analysis
1. Overview
Changes in key financial indicators in the Reporting Period are as follows:
Unit: RMB
Item 2020 2019 Change (%) Reason for the change
The adding of entities to the
Operating revenue 12,618,529,996.02 12,123,829,423.74 4.08% consolidated financial statements
for the current year
The adding of entities to the
Cost of sales 7,873,749,854.85 7,648,920,919.71 2.94% consolidated financial statements
for the current year
The adding of entities to the
Administrative expense 1,584,882,935.02 1,509,520,581.66 4.99% consolidated financial statements
for the current year
Decrease in financing costs and
Finance costs 1,232,729,624.82 1,936,269,737.53 -36.33% increase in exchange gains in the
current year
35
China Merchants Port Group Co., Ltd. Annual Report 2020
Asset disposal income
Transfer of land to the
1,489,206,502.32 4,794,562,782.79 -68.94%
government in last year
Net cash generated
from/used in operating 5,495,800,917.01 5,501,873,415.94 -0.11%-
activities
2. Revenue and Cost Analysis
(1) Breakdown of Operating Revenue
Unit: RMB
2020 2019
As % of total As % of total Change
Operating revenue operating Operating revenue operating revenue (%)
revenue (%) (%)
Total 12,618,529,996.02 100% 12,123,829,423.74 100% 4.08%
By operating division
Port operations 12,047,724,502.59 95.48% 11,547,072,185.86 95.24% 4.34%
Bonded
logistics 417,391,441.86 3.31% 411,410,069.19 3.39% 1.45%
service
Property
development 153,414,051.57 1.22% 165,347,168.69 1.36% -7.22%
and investment
By operating segment
Mainland
China, Hong
9,117,570,900.78 72.26% 8,872,027,132.24 73.18% 2.77%
Kong and
Taiwan
Other
countries and 3,500,959,095.24 27.74% 3,251,802,291.50 26.82% 7.66%
regions
(2) Operating Division, Product Category or Operating Segment Contributing over 10% of
Operating Revenue or Operating Profit
Unit: RMB
YoY
change in
Gross YoY change YoY change
gross
Operating revenue Cost of sales profit in operating in cost of
profit
margin revenue (%) sales (%)
margin
(%)
By operating division
Port
12,047,724,502.59 7,407,129,837.37 38.52% 4.34% 3.08% 0.75%
operations
By operating segment
36
China Merchants Port Group Co., Ltd. Annual Report 2020
Mainland
China, Hong
9,117,570,900.78 6,080,095,490.47 33.31% 2.77% 1.87% 0.59%
Kong and
Taiwan
Other
countries and 3,500,959,095.24 1,793,654,364.38 48.77% 7.66% 6.73% 0.45%
regions
Core business data of the prior year restated according to the changed statistical caliber for the
Reporting Period:
□ Applicable √ Not applicable
(3) Whether Revenue from Physical Sales Is Higher than Service Revenue
□ Yes √ No
(4) Execution Progress of Major Signed Sales Contracts in the Reporting Period
□ Applicable √ Not applicable
(5) Breakdown of Cost of Sales
Unit: RMB
2020 2019
Operating As % of total As % of total Change
Item
division Cost of sales cost of sales Cost of sales cost of sales (%)
(%) (%)
Loading
Port and
7,407,129,837.37 94.07% 7,185,667,723.72 93.94% 3.08%
operations unloading
services
Bonded
Logistics
logistics 245,350,697.54 3.12% 240,230,706.61 3.14% 2.13%
service
service
Property
development
Properties 221,269,319.94 2.81% 223,022,489.38 2.92% -0.79%
and
investment
Total 7,873,749,854.85 100.00% 7,648,920,919.71 100.00% 2.94%
(6) Changes in the Scope of Consolidated Financial Statements for the Reporting Period
√ Yes □ No
Ningbo Daxie China Merchants International Container Terminal Co., Ltd. (CMICT) was added to
the consolidated financial statements of the Company for the Reporting Period due to the business
37
China Merchants Port Group Co., Ltd. Annual Report 2020
combination of the Company and CMICT which were not under common control.
(7) Major Changes to the Business Scope or Product or Service Range in the Reporting Period
□ Applicable √ Not applicable
(8) Major Customers and Suppliers
Major customers:
Total sales to top five customers (RMB) 3,455,856,420.54
Total sales to top five customers as % of total sales of
27.39%
the Reporting Period (%)
Total sales to related parties among top five customers
2.71%
as % of total sales of the Reporting Period (%)
Top five customers:
Sales revenue
No. Customer contributed for the As % of total sales revenue (%)
Reporting Period (RMB)
1 Customer A 1,589,271,780.94 12.59%
2 Customer B 617,460,483.80 4.89%
3 Customer C 561,057,263.91 4.45%
4 Customer D 346,126,608.76 2.74%
5 Customer E 341,940,283.12 2.71%
Total -- 3,455,856,420.54 27.39%
Other information about major customers:
The company has an associated relationship with China COSCO Shipping Group Co., Ltd. among
the top five customers. Fu Gangfeng, the original chairman of the company (resigned as the
chairman of the company on January 31, 2020, less than 12 months after his resignation) served as
China Director and General Manager of Ocean Shipping Group Co., Ltd. Except for the above-
mentioned related relationships, the company and its directors, supervisors, senior managers, core
technical personnel, shareholders holding more than 5% of the shares and other related parties have
no direct or indirect interest in China COSCO Shipping Group Co., Ltd.
Major suppliers:
Total purchases from top five suppliers (RMB) 914,089,834.55
Total purchases from top five suppliers as % of
17.02%
total purchases of the Reporting Period (%)
Total purchases from related parties among top 0.00%
five suppliers as % of total purchases of the
38
China Merchants Port Group Co., Ltd. Annual Report 2020
Reporting Period (%)
Top five suppliers:
Purchase in the
No. Supplier As % of total purchases (%)
Reporting Period (RMB)
1 Supplier A 331,650,786.48 6.17%
2 Supplier B 180,249,953.38 3.36%
3 Supplier C 169,857,064.55 3.16%
4 Supplier D 119,928,727.26 2.23%
5 Supplier E 112,403,302.88 2.09%
Total -- 914,089,834.55 17.02%
Other information about major suppliers:
□ Applicable √ Not applicable
3. Expense
Unit: RMB
Change Reason for any significant
2020 2019
(%) change
Administrative
1,584,882,935.02 1,509,520,581.66 4.99% -
expense
Increase in exchange gains as a
result of exchange rate changes,
Finance costs 1,232,729,624.82 1,936,269,737.53 -36.33% and increase in interest income
due to the new US dollar loan
to TL
Higher expenses on various
R&D expense 156,024,113.54 123,853,344.29 25.97%
R&D projects
4. R&D Investments
In 2020, the Company made active efforts to promote intelligent ports and build a port ecosystem.
As the first automated terminal in China which is upgraded from a traditional bulk cargo terminal,
Mawan Intelligent Port has seen its Berth No. 3 successfully delivered. Being a combination of nine
intelligent factors, namely intelligent technologies, social and economic benefits, the integrated
“CMCore”, “CM ePort”, artificial intelligence, the application of 5G network, the Beidou System,
automation, intelligent port, and blockchain, as well as green and low-carbon development, the port
is considered a model for the automation of traditional ports at home and abroad. In terms of service
extension, the innovative business model of complex port is launched for the Guangdong-Hong
39
China Merchants Port Group Co., Ltd. Annual Report 2020
Kong-Macao Greater Bay Area. Through the comprehensive application of technologies such as
blockchain, big data, artificial intelligence and cloud computing, an innovative customs clearance
logistics platform is put in place for the Greater Bay Area to facilitate the healthy and sustainable
development of cross-board trade in the area. With respect to business innovation and development,
the Company actively cooperates with Internet technology tycoons to explore the construction of an
open intelligent port platform.
Details about R&D investments:
2020 2019 Change (%)
Number of R&D
874 611 43.04%
personnel
R&D personnel as % of
6.06% 4.29% 1.77%
total employees
R&D investments (RMB) 209,496,430.84 155,131,267.35 35.04%
R&D investments as %
1.66% 1.28% 0.38%
of operating revenue
Capitalized R&D
53,472,317.30 31,277,923.06 70.96%
investments (RMB)
Capitalized R&D
investments as % of total 25.52% 20.16% 5.36%
R&D investments
Reasons for any significant YoY change in the percentage of R&D investments in operating revenue:
□ Applicable √ Not applicable
Reason for any sharp variation in the percentage of capitalized R&D investments and rationale:
□ Applicable √ Not applicable
5. Cash Flows
Unit: RMB
Item 2020 2019 Change (%)
Subtotal of cash generated from
13,560,142,641.73 13,483,810,093.83 0.57%
operating activities
Subtotal of cash used in operating
8,064,341,724.72 7,981,936,677.89 1.03%
activities
Net cash generated from/used in
5,495,800,917.01 5,501,873,415.94 -0.11%
operating activities
Subtotal of cash generated from
12,531,582,996.10 11,616,175,588.24 7.88%
investing activities
Subtotal of cash used in investing 19,424,700,092.60 13,553,166,249.84 43.32%
40
China Merchants Port Group Co., Ltd. Annual Report 2020
activities
Net cash generated from/used in
-6,893,117,096.50 -1,936,990,661.60 -255.87%
investing activities
Subtotal of cash generated from
37,578,675,786.12 18,233,144,655.78 106.10%
financing activities
Subtotal of cash used in financing
32,184,203,323.64 19,466,847,993.77 65.33%
activities
Net cash generated from/used in
5,394,472,462.48 -1,233,703,337.99 537.26%
financing activities
Net increase in cash and cash
4,057,461,307.33 2,340,876,491.12 73.33%
equivalents
Explanation of why any of the data above varies significantly on a year-on-year basis:
Subtotal of cash used in investing activities rose 43.32% year-on-year, primarily driven by the
payment for the mandatory convertible bonds of TL and an increase in investments in other
companies.
Net cash generated from investing activities declined 255.87% year-on-year, primarily driven by a
year-on-year increase in cash used in investing activities.
Subtotal of cash generated from financing activities rose 106.10% year-on-year, primarily driven by
changes in the financings for investment projects.
Subtotal of cash used in financing activities rose 65.33% year-on-year, primarily driven by a year-
on-year increase in cash repayments of borrowings.
Net cash generated from financing activities rose 537.26% year-on-year, primarily driven by a
much faster growth in cash generated from financing activities than in cash used in financing
activities.
The net increase of cash and cash equivalents rose 73.33% year-on-year, primarily driven by the
comprehensive influence of each activity of cash flows.
Explanation of why net cash generated from/used in operating activities varies significantly from
net profit of the Reporting Period:
□ Applicable √ Not applicable
III. Analysis of Non-main Businesses
Unit: RMB
Amount As % of Main source/reason Exceptional or recurrent
41
China Merchants Port Group Co., Ltd. Annual Report 2020
total profit
Share of the profit of joint
Investment
4,905,975,438.22 72.13% ventures and associates, Recurrent
income
mainly Shanghai Port
Gain/loss on
Compensation income of
disposal of 1,489,206,502.32 21.90% Exceptional
land readjustment
assets
IV. Analysis of Assets and Liabilities
1. Significant Changes in Asset Composition
Indicate whether the Company has adopted the new accounting standards governing revenue and
leases since 2020 and restated the beginning amounts of relevant financial statement line items in
the year.
□ Applicable √ Not applicable
Unit: RMB
31 December 2020 1 January 2020
Change in
As % of As % of Reason for any
percentag
Amount total Amount total significant change
e (%)
assets assets
Funds pooled for project
payment in 2021 and
Monetary
11,791,424,734.63 7.00% 7,734,948,210.26 4.94% 2.06% repayment of bank
assets
borrowings in the
beginning of the year
Other
3,557,195,461.26 2.11% 2,129,378,252.50 1.36% 0.75% Land compensation
receivables
Other current Maturity of structured
433,666,201.42 0.26% 2,298,792,661.70 1.47% -1.21%
assets deposit
Long-term New loan financing for
3,887,949,993.10 2.31% 1,098,831,799.90 0.70% 1.61%
receivables project
Acquisition of 8
Long-term terminals from CMA,
equity 66,231,923,423.45 39.30% 57,916,539,383.26 36.96% 2.34% investment in Northeast
investments Asia Investment, and
consolidation of CMICT
Other non-
Consolidation of CMICT
current 910,807,452.56 0.54% 2,385,363,537.39 1.52% -0.98%
in the current year
financial assets
Transfer of the
Guangdong-Macau
Construction in
5,381,430,606.18 3.19% 6,334,141,441.88 4.04% -0.85% Phase II project of
progress
Shantou Port to fixed
assets
Goodwill impairment
Goodwill 6,675,939,930.13 3.96% 8,023,659,694.81 5.12% -1.16%
allowances
Current portion
Repayment of mature
of non-current 3,564,465,137.37 2.11% 6,104,339,856.79 3.90% -1.79%
borrowings
liabilities
Issue of short-term
Other current
2,383,668,985.94 1.41% 885,956,581.63 0.57% 0.84% commercial papers to
liabilities
raise financings
Long-term 1,228,461,573.69 0.73% 1,935,245,003.21 1.24% -0.51% Decrease in rebates of
42
China Merchants Port Group Co., Ltd. Annual Report 2020
payables port construction fees
2. Assets and Liabilities at Fair Value
Unit: RMB
Impair
Cumulative
Gain/loss on -ment
fair-value
fair-value allowance Purchased in the Sold in the
Item Beginning amount changes Other changes Ending balance
changes in the for the Reporting Period Reporting Period
charged to
Reporting Period Reporting
equity
Period
Financial
assets
Held-for-
trading
financial
assets
2,385,363,537.39 269,099,721.85 - - 2,625,398,611.55 -310,000,000.00 -3,208,888,969.64 1,760,972,901.15
(excluding
derivative
financial
assets)
Other
equity
163,561,272.00 - 216,691.00 - - - 17,689,094.74 181,467,057.74
instrument
investment
Subtotal of
financial 2,548,924,809.39 269,099,721.85 216,691.00 - 2,625,398,611.55 -310,000,000.00 -3,191,199,874.90 1,942,439,958.89
assets
Receivables
260,760,537.45 - - - - - -43,310,571.04 217,449,966.41
financing
Total of the
2,809,685,346.84 269,099,721.85 216,691.00 - 2,625,398,611.55 -310,000,000.00 -3,234,510,445.94 2,159,889,925.30
above
Financial
4,059,686,208.87 -680,381,987.28 - - - -741,328,044.50 250,419,464.44 2,888,395,641.53
liabilities
Details of other changes:
N/A
Significant changes to the measurement attributes of the major assets in the Reporting Period:
□ Yes √ No
3. Restricted Asset Rights as at the Period-End
The restricted monetary assets were RMB11,528,570.90 of security deposits.
The carrying value of fixed assets as collateral for bank loans was RMB341,931,071.09.
The carrying value of construction in progress as collateral for bank loans was RMB43,751,101.60;
and the carrying value of intangible assets as collateral for bank loans was RMB218,825,477.36.
The carrying value of equities and interests collateral for bank loans was RMB2,485,702,767.56.
43
China Merchants Port Group Co., Ltd. Annual Report 2020
V. Investments Made
1. Total Investment Amount
Amount in 2020 (RMB) Amount in 2019 (RMB) Change (%)
Equity investment 5,706,331,715.60 7,898,674,384.09 -27.76%
Non-equity investment 2,728,598,026.38 3,515,540,735.97 -22.38%
2. Major Equity Investments Made in the Reporting Period
Unit: RMB’0,000
Return on Any
Way Investment Disclos Index to
Investme The Anticip investmen legal
Name of of Funding Joint Term of Type of progress as at ure disclosed
Principal activity nt Company ated t in the matter
Investee invest source investor investment products the balance date (if information
amount ’s interest income Reporting involv
ment sheet date any) (if any)
Period ed
Investment and
asset
management;
land
development
services;
industrial park
management
services; supply
of power, heating
and water;
engineering
management
Term of
services; Liaonin www.cninf
operation:
Northeast property Incor g Port o.com.cn
Self- 50 years, 7 Apr.
Asia management; porat 100,000 22.22% Group Equity Completed 0.00 778.63 No (Announce
funded renewable 2020 ment No .
Investment plant leases; ed and
upon 2020-025)
meeting, CMSK
expiry
exhibition and
related services;
business
management
consulting
services. (where
an administrative
permit is
required
according to law,
it must be
obtained before
operation.)
CMPort Investing in
(Shenzhen equities of non- China
) Industrial listed and listed Mercha
Innovation port-related nts
www.cninf
Private companies with Venture
Incor Term of o.com.cn
Equity respect to Self- and 1 Dec.
porat 30,000 49.99% Fund: 7 Equity Ongoing 0.00 0.00 No (Announce
Investment technology funded China 2020 ment No .
ed years
Fund innovation, Mercha 2020-085)
Partnershi business model nts
p (Limited innovation, trade Venture
Partnershi digitalization, Fund
p) etc.
Total -- -- 130,000 -- -- -- -- -- -- 0.00 778.63 -- -- --
44
China Merchants Port Group Co., Ltd. Annual Report 2020
3. Major Non-Equity Investments Ongoing in the Reporting Period
Unit: RMB
Reason for
Accumula
not
Fixed tive
Way reaching
assets Input amount in Accumulative actual Estimated realized
of Industry Capital the
Item investm the Reporting input amount as of the Progress return on revenues
invest involved resources schedule
ent or Period period-end investment as of the
ment and
not period-
anticipated
end
income
Haixing
Harbor 1#-
Support
4# berths Self-funded
Self- activities for
renovation Yes 485,237,057.61 1,544,226,816.60 and loan- 54.16% 0.00 0.00 N/A
built water
project— funded
transportation
water
engineering
HIPG
container
and oil Support
Self-funded
terminals Self- activities for
Yes 143,384,534.55 1,550,440,336.85 and loan- 56.00% 0.00 0.00 N/A
and tank built water
funded
zone transportation
renovation
project
Machong
Port 2# and
3# berths Support
Self-funded
and bulk Self- activities for
Yes 165,851,858.79 487,050,717.25 and loan- 78.56% 0.00 0.00 N/A
grain built water
funded
warehouse transportation
phase III
project
Zhanjiang
Port Support
Self-funded
Xiashan Self- activities for
Yes 230,330,096.08 464,639,005.10 and loan- 62.98% 0.00 0.00 N/A
Port built water
funded
General transportation
Wharf
General
Cargo
Support
project of Self-funded
Self- activities for
Zhanjiang Yes 112,037,664.03 366,583,393.31 and loan- 40.49% 0.00 0.00 N/A
built water
Port funded
transportation
Donghai
Island
Total -- -- -- 1,136,841,211.06 4,412,940,269.11 -- -- 0.00 0.00 --
4. Financial Investments
(1) Securities Investments
Unit: RMB
Ac
Va cou Ac Ca
rie Na nti Sold
Cumulative co pit
ty me ng Gain/loss on fair in the
Code of fair value Gain/loss in the un al
of of Initial investment me Beginning carrying value changes in Purchased in the Repo Ending carrying
securiti changes Reporting tin res
se sec cost asu value the Reporting Reporting Period rting value
es recorded into Period g ou
cu urit re Period Perio
equity ite rce
riti ies me d
m s
es nt
mo
45
China Merchants Port Group Co., Ltd. Annual Report 2020
del
Do
Tr
me
Fai adi
sti
r ng Se
c/o Nin
val fin lf-
ve gbo
601018 592,183,095.14 ue 1,548,914,671.20 183,843,813.95 - 1,465,398,611.55 - 52,532,104.65 - an ow
rse Por
me cia ne
as t
tho l d
St
d ass
oc
ets
k
Do
Tr
me
Fai adi
sti
Qin r ng Se
c/o
gda val fin lf-
ve
06198 o 124,405,138.80 ue 204,263,917.11 -27,141,455.82 - - - 8,036,071.58 166,225,139.77 an ow
rse
Por me cia ne
as
t tho l d
St
d ass
oc
ets
k
Do
Tr
me
Fai adi
sti
Qin r ng Se
c/o
gda val fin lf-
ve
601298 o 331,404,250.30 ue 616,000,000.00 104,160,000.00 - - - 22,433,600.00 720,160,000.00 an ow
rse
Por me cia ne
as
t tho l d
St
d ass
oc
ets
k
Ot
he
r
Do
eq
me
Fai uit
sti Jian
r y Se
c/o gsu
val ins lf-
ve Exp
600377 1,120,000.00 ue 11,220,000.00 - -324,900.00 - - 460,000.00 10,786,800.00 tru ow
rse ress
me me ne
as wa
tho nt d
St y
d in
oc
ve
k
st
me
nt
Ot
he
r
Do
eq
me
Fai uit
sti
Petr r y Se
c/o
och val ins lf-
ve
400032 emi 3,500,000.00 ue 382,200.00 - - - - - 382,200.00 tru ow
rse
cal me me ne
as
A1 tho nt d
St
d in
oc
ve
k
st
me
nt
Ot
he
r
Do
eq
me
Fai uit
sti
r y Se
c/o Gu
val ins lf-
ve ang
400009 27,500.00 ue 17,000.00 - - - - - 17,000.00 tru ow
rse Jian
me me ne
as 1
tho nt d
St
d in
oc
ve
k
st
me
nt
46
China Merchants Port Group Co., Ltd. Annual Report 2020
Total 1,052,639,984.24 -- 2,380,797,788.31 260,862,358.13 -324,900.00 1,465,398,611.55 0.00 83,461,776.23 897,571,139.77 -- --
(2) Investments in Derivative Financial Instruments
□ Applicable √ Not applicable
5. Use of Funds Raised
(1) Overall Usage of Funds Raised
Unit: RMB’0,000
Proporti
Amount
on of
The usage of funds
Total funds Accumulativ accumul
Way Total funds and raised
Total funds used in the Accumulativ e funds with ative Total unused
Year of with usage destination idle for
raised Current e fund used usage funds funds
raising changed of unused over
Period changed with
funds two
usage
years
changed
Deposited
Private
in funds
2019 place 221,282.91 307,473.46 520,882.19 0 18,599.73 8.41% 88,478.69 0
raising
ment
account
Total -- 221,282.91307,473.46 520,882.19 0 18,599.73 8.41% 88,478.69 -- 0
Explanation of overall usage of funds raised
As approved in the document “ZJXK [2018] No. 1750” of CSRC, CMPort issued 128,952,746 RMB ordinary shares (A Share) at
RMB 17.16 per share through private placement on Shenzhen Stock Exchange. The total fund raised was RMB2,212,829,121.36,
and after deducting fees associated with the issuance of shares, the net fund raised was RMB2,185,997,340.15. As of 23 October
2019, the aforementioned fund was fully paid, which was verified by BDO China Shu Lun Pan Certified Public Accounts LLP with
a capital verification report (XKSBZ [2019] No. ZI10673). As of 31December 2020, a total of RMB5,208,821,925.44 in the
Company’s fund account had been used, including: (1) RMB582,722,414.48 for replacing the self-funding spent on fundraising
investment projects in advance; (2) RMB749,267,729.75 as raised fund invested after the fund was paid, including an investment of
RMB749,267,729.75 in the Haixing Harbor renovation project (Phase II) (2019: RMB324,533,139.29; 2020:
RMB424,734,590.46); (3) RMB26,831,781.21 for paying issue fees; (4) RMB3,850,000,000.00 for purchasing structured deposits
(2019: RMB1,200,000,000.00; 2020: RMB2,650,000,000.00). As of 31 December 2020, the net amount of interest income
generated from the fund account is RMB1,938,427.36 after deducting surcharges (2019: RMB795,775.14; 2020:
RMB1,142,652.22); the amount of structured deposits redeemed is RMB3,050,000,000.00 (2019: RMB100,000,000.00; 2020:
RMB2,950,000,000.00); the amount of income from structured deposits is RMB28,841,232.88 (2019: RMB302,465.75; 2020:
RMB28,538,767.13); as of 31 December 2020, the balance amount deposited in the fund-raising account is RMB884,786,856.16.
(2) Commitment Projects of Fund Raised
Unit: RMB’0,000
Accumulat
Investment Whether
Changed or Investment Investme ive Date of
Committed Realized Whether occurred
not Committed amount nt amount investment schedule as reaching
investment project income in the reached significant
(including investment after in the amount as the period- intended
and super raise Reporting anticipated changes in
partial amount adjustment Reporting of the end (3)＝ use of the
fund arrangement Period income project
changes) (1) Period period-end (2)/(1) project
feasibility
(2)
Committed investment project
Supporting
transformation N/A
Yes 18,599.73 - - - - - No No
project of Han (Note 1)
Port
47
China Merchants Port Group Co., Ltd. Annual Report 2020
Transformation
30 June N/A
project of Haixing No 200,000 218,599.73 42,473.46 133,199.01 60.93% No No
2021 (Note 2)
Harbor (Phase II)
Subtotal of
committed -- 218,599.73 218,599.73 42,473.46 133,199.01 -- -- -- -- --
investment project
Super raise fund arrangement
N/A
Subtotal of super
raise fund -- - - - - -- -- 0 -- --
arrangement
Total -- 218,599.73 218,599.73 42,473.46 133,199.01 -- -- 0 -- --
Note 1: Based on the estimated construction progress of supporting transformation project of Han Port, US$ 79 million and
USD281 million were planned to be used to build an oil wharf and a tank area respectively in 2019 and 2020; USD12.48 million
and 179.6 million were planned to be used to acquire quay cranes, yard cranes and other operating equipment respectively in 2019
Condition and
and 2020. The funds were estimated to be fully spent by 2020. So far the project has been delayed. In order to further optimize its
reason for not
internal resource allocation, increase the utilization efficiency of funds and safeguard shareholders’ rights and interests, the
reaching the
Company used RMB185,997,300 of the fund raised in transformation project of Haixing Harbor (Phase II). As of 31 December
schedule and
2020, a total of RMB0 had been invested in supporting transformation project of Han Port. 2. Transformation project of Haixing
anticipated
Harbor (Phase II) is currently under construction and thus has not generated income.
income (by
Note 2: Due to adjustments to government planning, the delayed delivery of the Xiaoyetian site, the COVID-19 pandemic,
specific items)
changes to engineering design, etc. since the start of its construction, the date of reaching the intended use of the Transformation
project of Haixing Harbor (Phase II) has been adjusted from Q4 2020 to Q2 2021. This project is currently under construction and
thus has not generated income.
Notes of
condition of
significant
N/A
changes occurred
in project
feasibility
Amount, usage
and schedule of N/A
super raise fund
Changes in
implementation
N/A
address of
investment project
Adjustment of
implementation
N/A
mode of
investment project
BDO China Shu Lun Pan Certified Public Accountants LLP verified the upfront investment with self-pooled funds in raised funds
investment projects, and issued the XKSSBZ [2019] No. 10423 The Audit Report on the Upfront Investment with Self-Pooled
Upfront
Funds in raised Funds Investment Project of Shenzhen Haixing Harbor Development Co., Ltd. dated 12 November 2019. As of 31
investment and
October 2019, the upfront investment with self-pooled funds in raised funds investment projects amounted to RMB582.7224
transfer of
million. In December 2019, pursuant to the Proposal on the Swap of Raised Funds and Upfront Investment of Self-Pooled Funds
investment project
approved at the 11th Extraordinary Meeting of the 9th Board of Directors in 2019, the Company has completed the swap of the
aforesaid funds.
Idle fund
supplementing the
N/A
current capital
temporarily
Amount of
surplus in project
N/A
implementation
and the reasons
Usage and
destination of Unused fund was deposited in the fund-raising account.
unused funds
On 22 November 2019, the 11th Extraordinary Meeting of the 9th Board of Directors in 2019 reviewed and approved the Proposal
Problems incurred
on the Implementation of Cash Management by the Usage of Idle Raised Funds, which agreed the Company to carry out cash
in fund using and
management by using idle funds of no more than RMB1.2 billion. The quota was valid within 12 months of the date when the
disclosure or
said proposal was approved by the Board. And the cash management amount would be returned to the account of raised funds
other condition
upon the expiry.
48
China Merchants Port Group Co., Ltd. Annual Report 2020
On 30 November 2020, the Second Extraordinary Meeting of the 10th Board of Directors in 2020 and the Second Extraordinary
Meeting of the 10th Supervisory Committee in 2020 reviewed and approved the Proposal on the Implementation of Cash
Management by the Usage of Idle Raised Funds, which agreed the Company to carry out cash management by using idle funds of
no more than RMB800 million. The quota was valid within 12 months of the date when the said proposal was approved by the
Board. And the cash management amount would be returned to the account of raised funds upon the expiry.
As of 31 December 2020, the Company has purchased structured deposits of RMB3,850,000,000.00 (2019:
RMB1,200,000,000.00; 2020: RMB2,650,000,000.00) at CMB Shenzhen New Times Sub-branch with its temporarily idle raised
funds, among which RMB3,050,000,000.00 has been redeemed (income for 2019: RMB302,465.75; income for 2020:
RMB28,538,767.13), and the residual RMB800,000,000.00 was still deposited in the structured deposits account.
(3) Changes in Items of Funds Raised
Unit: RMB’0,000
Reali Whether
Whet
Corres zed occurred
Amount of Actual Accumulati her
pondin Investment inco significa
planned investment ve reach
Items g schedule Date of reaching me in nt
funds amount in investment ed
after original as the intended use of the the changes
invested the amount as antici
changes commit period-end project Repo in
after Reporting the period- pated
ted (3)=(2)/(1) rting project
changes (1) Period end (2) inco
items Perio feasibilit
me
d y
Suppor
Transform
ting
ation
transfor
project of
mation 218,599.73 42,473.46 133,199.01 60.93% 30 June 2021 0 No No
Haixing
project
Harbor
of Han
(Phase II)
Port
Total -- 218,599.73 42,473.46 133,199.01 -- -- 0 -- --
The usage of unused fund of RMB185.9973 million in supporting
transformation project of HIPG was changed to the construction of
transformation project of Haixing Harbor (Phase II). The matters of partial
Notes of reasons for changes, changes in fund raised investment has been approved by the Proposal on Partial
decision-making procedures and Changes in Usage of Fund Raised, which was reviewed and approved on the 11th
information disclosure (by Extraordinary Meeting of the 9th Board of Directors in 2019 on 22 November
specific items) 2019. The Announcement of Partial Changes in Usage of Fund Raised
(Announcement No. 2019-85) has been disclosed on website
www.cninfo.com.cn on 26 November 2019. As of 31 December 2020, the
amount with usage changed was RMB185.9973 million.
Due to adjustments of government planning, the delayed delivery of the
Condition and reason for not Xiaoyetian site, the COVID-19 pandemic, changes to engineering design, etc.
reaching the schedule and since the start of its construction, the date of reaching the intended use of the
anticipated income (by specific Transformation project of Haixing Harbor (Phase II) has been adjusted from Q4
items) 2020 to Q2 2021. This project is currently under construction and thus has not
generated income.
Notes of condition of significant
changes occurred in project N/A
feasibility after changes
49
China Merchants Port Group Co., Ltd. Annual Report 2020
VI. Sale of Major Assets and Equity Interests
1. Sale of Major Assets
□ Applicable √ Not applicable
No such cases in the Reporting Period.
2. Sale of Major Equity Interests
□ Applicable √ Not applicable
VII. Major Subsidiaries
Major fully/majority-owned subsidiaries and those minority-owned subsidiaries with an over 10%
effect on the Company’s net profit
Unit: RMB
Relat
ionsh
ip Principal
Name with activity Registered capital Total assets Net assets Operating revenue Operating profit Net profit
the
Com
pany
Port
China business,
Merchants bonded
Port Subsi logistics 42,521,339,893.42
140,050,855,725.44 92,907,480,373.35 7,956,928,250.59 5,984,205,211.47 5,064,412,321.79
Holdings diary and (HKD)
Company property
Limited investmen
t
Business
Shanghai
Joint related to
Internatio
stock port,
nal Port 23,173,674,650.00 155,924,749,976.52 95,979,599,650.80 26,119,460,820.07 10,586,267,534.26 9,183,403,328.66
comp container
(Group)
any and
Co., Ltd.
terminal
Subsidiaries obtained or disposed in the Reporting Period
How subsidiary was obtained or Effects on overall operations and
Subsidiary
disposed in the Reporting Period operating performance
Control realization to CMICT and
Ningbo Daxie China Merchants investment income recognized of
Business combination not under
International Container Terminal long-term equity investment at fair
the same control
Co., Ltd. value under the original equity
method
Notes of major holding companies and joint stock companies
There is no information on major holding companies and joint stock companies for the Company to
disclose during the Reporting Period.
50
China Merchants Port Group Co., Ltd. Annual Report 2020
VIII. Structured Bodies Controlled by the Company
Applicable √ Not applicable
IX. Outlook for the Future Development of the Company
1. Layout and trends of the industry
Looking into 2021, the pandemic remains the most significant uncertainty. Nonetheless, with the
gradual rollout of vaccines, the effect of the pandemic on global economic and social activities will
diminish and the world’s economy is expected to fully recover. As the economy and trade return to
normal, the economic growth of developed economies will increase steadily in 2021. Subject to
COVID-19 vaccine distribution progress, emerging markets and developing economies face
uncertainties in economic development. The social and political turmoil in certain emerging
economies will drag down economic growth, notably in regions such as the Middle East and North
Africa. In January 2021, the IMF predicted the global economy to grow by 5.5% in 2021,
representing an increase of 9.0% year-on-year. In particular, the developed economies will grow at
4.3%, up 9.2 percentage point as compared to that of 2020; and the emerging markets and
developing economies will grow at 6.3%, up 8.7 percentage point as compared to that of 2020.
Global trade volume (including goods and services) will grow by 8.1%, up 17.7 percentage points
as compared to that of 2020.
The year 2021 follows China’s completion of building a moderately prosperous society in 2020 and
marks the first year of the “14th Five-Year” Plan and 2035 Vision. China will take the initiative to
adapt to the new environment and new challenges. Adhering to the new development philosophy, it
will promote high-quality economic and social development by intensifying the supply-side
restructuring, paying attention to demand-side management, and establishing the new dual
circulation development pattern. As the first country to witness a rapid economic rebound from the
pandemic, China will continue to lead global economic recovery in 2021. According to IMF’s latest
report, China’s economic growth rate will rebound to 8.1% in 2021, making it one of the fastest-
growing major economies.
In 2021, the global container shipping market continues to face uncertainties to some extents.
Supply and demand imbalance of global shipping capacity, container shortage, and port congestion
will support the upward trend in the shipping market and result in a chain reaction to freight rates
and schedule reliability. If the COVID-19 pandemic is brought under control over time, shipping
routes, shipping capacity, and quantity supply of containers may be back to normal and the freight
51
China Merchants Port Group Co., Ltd. Annual Report 2020
rates of container transportation may decrease correspondingly. Global economic recovery, along
with other positive factors, is expected to drive demand for seaborne freight.
In 2021, China will further open up its economy and implement policies and measures that favor
foreign trade. Through broader, more extensive and in-depth opening up, China will establish the
new dual circulation development pattern for the domestic and international economic cycles
boosting each other. As the free trade zone pilot system plays an increasingly important role in
innovation, trade and investment will be more convenient. Besides, the signing of the Regional
Comprehensive Economic Partnership (RCEP) Agreement and the organizing of China
International Import Expo will strengthen the cooperation between China and its trading partners,
increasing momentum for commodity import and export and benefiting the port industry. Moreover,
the ongoing progress in the construction of intelligent ports and green ports will also inject new
energy into the development of the port industry.
2. Development strategies of the Company
The Company is striving to become a world-class comprehensive port service provider. The
Company will firmly adhere to the strategic principle of “leveraging on its long-term strategy,
tapping the current edges, driving through technology and embracing changes” and the goal of
quality development to accelerate the technology-powered innovation, realize a scientific global
layout with balanced development, provide first-class professional solutions, and seek more returns
for shareholders, the efforts of which will in turn support the development of local economy and
industries and make positive contributions to the port industry.
Firstly, in respect of domestic strategies, the Company will, by seizing the opportunities arising
from the supply-side restructuring and based on “regional consolidation and enhancement of
synergy”, consistently seek for opportunities of consolidation and cooperation across the five major
port clusters along the coastal regions, in order to further expanding and improving its domestic
port network layout. The Company is expected to lead a new direction in the consolidation of
regional ports with a key focus on constantly improving the quality of port development with every
effort.
Secondly, in respect of overseas strategies, the Company will continue to capitalize on the
opportunities arising from the national “Belt and Road” initiative promoted and the international
industrial transfers, and adapt to the trend of deploying mega-vessels and forming shipping alliances.
Emphasis will be placed on the development of global major hub ports and gateway ports as well as
those regions with high market potential, fast-growing economy and promising development
52
China Merchants Port Group Co., Ltd. Annual Report 2020
prospect. The Company will grasp opportunities in port, logistics, and related infrastructure
investment and enhance its global port network persistently.
Thirdly, in respect of innovation strategies, adhering to the principle of “driving through technology
and embracing changes”, the Company will continuously increase its investment in innovation and
establish a foothold in the technology high ground to support the future port development. By
means of technological innovation and management innovation, it will significantly enhance the
efficiency and profitability of port operation and become a leading enterprise in the intelligence
transformation of traditional ports. It will also enrich the comprehensive port services through
business model innovation.
3. Business plans for 2021
In 2021, the Company will continuously commit itself to the overall operation philosophy of
“making progress amid stability”, firmly adhere to the strategic principle of “leveraging on its long-
term strategy, tapping the current edges, driving through technology and embracing changes”,
promote quality and efficiency improvement with related measures, and implement risk prevention
with a focus on system development. In pursuit of high-quality growth, it will accelerate
technology-led and innovation-driven development, so as to strive towards its vision of becoming
the “world-class comprehensive port service provider”.
In terms of the construction of homebase ports, the Company will press ahead at full steam with the
development of world-class leading ports to implement the strategy of building a strong
transportation country. It will refine and optimize the future development goals and action plans for
West Shenzhen Port Zone and boost comprehensive capabilities in line with the development
strategy of the Guangdong-Hong Kong-Macao Greater Bay Area. Through better resource
allocation, enhancement of the management basis, expansion of ancillary and value-added services,
and improvement of service standards, it will develop a port ecosystem for win-win outcomes. At
the same time, it will further incorporate intelligence elements into Mawan Intelligent Port to
achieve business innovation and increase regional influence. In terms of overseas homebase ports,
CICT and HIPG will continue to focus on port business and strengthen cooperation with shipping
companies, so as to enhance business synergy, capitalize on the collaborative advantages between
port zones, and evolve into international shipping centers in South Asia. HIPG will push forward
the growth of all business segments and work on the introduction of business and investment into
industrial parks.
In terms of the overseas business, the Company will stick to the overall development plan for
53
China Merchants Port Group Co., Ltd. Annual Report 2020
projects abroad, “East-West routes, South-North routes, regions along the Belt and Road Initiative”.
Apart from completing the delivery procedures for the remaining two terminals of CMA CGM, it
will optimize the construction of the overseas management and control system and improve the
operating effectiveness and efficiency of overseas projects by optimizing their management system.
In the face of the current complex international dynamic, it will keep abreast of changes in the trade
environment and continuously monitor port consolidation opportunities within the region.
In terms of comprehensive development, the Company will closely follow changes in the trade
environment, seize opportunities brought by the adjustment of the global industrial chain, and tap
into favorable policies to exploit the market. By fully integrating the resources from the port
industrial chain, value chain, logistics chain, and innovation chain, it will explore the PPC
comprehensive development model and seek for sustainable business development through
“investment introduction to industrial parks and comprehensive land development”.
In terms of innovative development, the Company will focus on innovation-driven and technology-
empowered industrial transformation and upgrade. Leveraging the Development and Research
Center of CMPort, it will develop the technology innovation ecosystem of CMPort and export port
technology innovation programmes, with an aim to build the integrated industry, education, and
research platform. Centering on the “CM Chip” platform, it will develop three leading products in
the industries, including CTOS (Container Terminal Operation System), BTOS (Bulk Cargo
Terminal Operation System), and LPOS (Logistic Park Operation System), to realize intelligent
production and operation within the terminals. The “CM ePort” platform will innovate the service
models through the improvement of the information service system of port zones and the
“Port+Internet” approach, and explore and develop an open intelligent port platform.
In terms of operation management, the Company will continue to follow strategic guidance and
optimize management and control. It will also further boost management and control efficiency.
The Company will establish an entire lifecycle asset management system to enhance construction
quality and management of major projects. By the ongoing improvement of business management
standards, it will develop a world-class operating management system that creates sustainable value
and a value-oriented management headquarters.
In terms of marketing and commerce, the Company will continue to cooperate with major shipping
companies, optimize port environment, enhance interaction with end-customers, improve customer
loyalty, and strengthen direct control and influence over cargo sources, so as to boost the market
competitiveness of CMPort. In line with the national dual circulation pattern, it will establish the
54
China Merchants Port Group Co., Ltd. Annual Report 2020
interconnected system of “two ports and one shipping route” in Northern and Southern China to
create synergy between these two regions, develop and upgrade new shipping routes, and encourage
business collaboration of ports within all cargo regions, promoting domestic trade businesses.
Capital expenditure plans:
In 2021, the Company will formulate capital expenditure plans according to business development
needs. Key investment projects include Haixing Harbor upgrade and reconstruction project,
Machong Port Bulk Grain Phase III Project, Zhanjiang Port Xiashan Port General Terminal Project,
and the construction of HIPG container terminal in Sri Lanka, etc.
4. Possible risks and counter measures
(1) Risk of macroeconomic fluctuations
Internationally, volatile epidemic situation, global economic fluctuation, and political turmoil cast
uncertainties over the global economic and business environment. Given the continued and repeated
impact of the pandemic on the global economy, the effectiveness of pandemic control measures and
relief policies rolled out in various countries will affect global economic recovery. Following the
pandemic, the new round of easy monetary policies will increase global debt level and emerging
markets will become more vulnerable. Traditional and non-traditional risks, such as natural
disasters and geopolitical uncertainties, may aggregate volatility in the international financial
market. Such risks of uncertainties will shock China’s foreign trade market, container shipping
market, and bulk commodity demand, and pose certain challenges to the Company’s overseas
investment and layout planning.
Domestically, lack of a sound foundation for economic recovery, China’s economic growth still
faces uncertainties as a result of the pandemic, the Sino-US friction, and the effectiveness of
vaccine distribution. In addition, the pandemic has accelerated the implementation of technological
innovation policies in the national level and amplified the demand and urgency of the digitalization
in the shipping industry.
Facing the risk of macroeconomic fluctuations, especially the risks imposed on foreign trade and
import and export business by the COVID-19 pandemic and the Sino-US trade friction, the
Company will take the initiative to identify and respond to changes. Firstly, it will work in full
swing to support the national 14th Five-year Plan and achieve high-quality growth by facilitating
transformation and upgrade of enterprises in the post-pandemic era. Secondly, it will follow the
national “Belt and Road” initiative and the strategies on building a strong transportation country,
developing the Guangdong-Hong Kong-Macao Greater Bay Area, and realizing the integrated
55
China Merchants Port Group Co., Ltd. Annual Report 2020
development of Yangtze River Delta, so as to help construct the new national dual circulation
development pattern. Thirdly, it will seize the opportunities arising from a new round of high-level
opening up policies to drive the sustainable development of port-related business under the
economic globalization trend. Fourthly, it will enhance capacity building of risk identification,
warning, and elimination, and continue to follow up on the development of the global industrial
chain and trade movements to adjust business operating strategies appropriately to effectively
prevent, control, and reduce external risks.
(2) Policy risks
The policy risks in the port industry can be either positive or negative to the industry. On the one
hand, national strategies such as the key “Belt and Road” initiative and the development of the
Guangdong-Hong Kong-Macao Greater Bay Area will introduce favorable policies to the industrial
development; on the other hand, policies and initiatives of the government for reducing costs and
improving efficiency in logistics, anti-monopoly, and environmental protection may exert pressure
on the profitability of the port industry.
Facing the policy risks, on one hand, the Company will proactively practice the key “Belt and Road”
initiative and a series of national strategies to seize the opportunities arising from these policies; on
the other hand, in response to the negative risks, the Company will improve its operation
management capability by continuously enhancing quality and efficiency and strengthening
resource allocation, and will constantly optimize strategic initiatives to actively seek new profit
growth driver and improve the sustainable profitability.
(3) Operation management risks
Amidst the current favorable environment of domestic and overseas regional ports integration, the
Company has swiftly strengthened its main port business and successfully made investments,
mergers, and acquisitions of a number of domestic and overseas ports. At the same time, the
Company faces unfavorable conditions of ports in certain regions such as massive port asset
investment in certain regions, relatively low operation efficiency and investment returns, and etc.
The major risks include: (1) investment decision-making will be riskier and more difficult under the
current complicated external environment; (2) the Company’s internationalized operation
management system still needs to be improved and the Company shall strengthen the benefits of
integration through management output and other ways to accommodate with its own rapid
development and expansion; (3) the risk control system shall be consistently established and
optimized to constantly improve management efficiency.
In terms of the Company’s internal operation management risks, the Company will: (1) increase
customer loyalty and seize market opportunities based on three improvement elements, namely
“market, resources, services”; (2) improve internal control system to take further precautions in risk
56
China Merchants Port Group Co., Ltd. Annual Report 2020
control and reinforce the stringent restrictions on internal control, ensuring effective risk
identification and control and consolidating the foundation of risk control; and (3) optimize risk
warning system to precisely keep abreast of the new developments with an aim to seize the prime
opportunities for risk control.
X. Communications with the Investment Community such as Researches, Inquiries and
Interviews
1. During the Reporting Period
Type
Way of of Index to basic
Date Place communi commu Object of communication information of
cation nicatio researches
n party
Industrial Securities, Changjiang
Securities, UBS, Shanghai Life
Insurance, Oriental Alpha Fund,
China Securities, China COSCO,
CICC, Ever Bloom, Xingyin
Fund, Huaxi Securities, Huashang
Fund, Hua’an Fund, Huatai
China Securities, Sichuan Development
16 April Merchants Teleconfer Institut
Fund, Guotai Junan, GTS Fund,
2020 Port encing ion
TF Fund, CPIC, Pacific
Building
Securities, Pacific Assets, Ping’an
Securities, China Merchants Main discussions:
Securities, Zheshang Securities, the basic condition
Haitong Securities, Shenwan of operations,
Hongyuan Securities, Green investments made
Court Capital, Juli Investment, and the financial
Western Securities condition of the
China Company;
One-on- Materials provided:
Merchants Institut Golden Eagle Fund
29 May 2020 one None
Port ion Baoying Fund
meeting
Building Index: SZSE EasyIR
China (http://irm.cninfo.co
One-on- m.cn/ircs/index)
Merchants Institut Haitong Securities and Golden Eagle
9 July 2020 one
Port ion Fund
meeting
Building
Changjiang Securities, Huaxi
Securities, Haitong Securities,
China Zheshang Securities, Huarong
31 August Merchants Teleconfer Institut Securities, Golden Eagle Fund,
2020 Port encing ion Baoying Fund, Lion Fund, Zeyuan
Building Capital, Xianhu Investment,
Shanyuan Fund, and GHY
Environment Water (GHY)
57
China Merchants Port Group Co., Ltd. Annual Report 2020
Investment
conference
10 September Institut
Shanghai of Changjiang Securities
2020 ion
securities
firm
China
Communic
22 September Merchants Institut
ation on Ping An Asset Management
2020 Port ion
phone
Building
One-on-
4 November Institut
Shenzhen one Cinda-CBA Fund
2020 ion
meeting
Investment
conference
11 November Institut
Chengdu of Huaxi Securities
2020 ion
securities
firm
By phone,
1 January, or written
China
2020 to inquiry (the
Merchants Individ
31 EasyIR Individual investors
Port ual
December, platform of
Building
2020 SZSE or
email)
Times of communications 145
Number of institutions communicated with 50
Number of individuals communicated with 137
Number of other communication parties 0
Tip-offs or leakages of substantial supposedly-confidential information during
No
communications
2. Period-end to Disclosure Date
Type
Way of of Index to basic
Date Place commun commu Object of communication information of
ication nicatio researches
n party
By Main discussions:
phone, the basic condition
or of operations,
written investments made
China
inquiry and the financial
1 January 2021 Merch
(the condition of the
to 30 March ants Individ
EasyI Individual investors Company;
2021 Port ual
R
Buildin Materials provided:
platfor
g None
m of
SZSE Index: SZSE EasyIR
or (http://irm.cninfo.co
email) m.cn/ircs/index)
Times of communications 17
Number of institutions communicated with 1
58
China Merchants Port Group Co., Ltd. Annual Report 2020
Number of individuals communicated with 16
Number of other communication parties 0
Tip-offs or leakages of substantial supposedly-confidential information during
No
communications
59
China Merchants Port Group Co., Ltd. Annual Report 2020
Part V Significant Events
I. Profit Distributions to Ordinary Shareholders (in the Form of Cash and/or Stock)
Formulation, execution or adjustments of profit distribution policy for ordinary shareholders,
especially cash dividend policy, in Reporting Period
Pursuant to the CSRC Guideline for Listed Companies No.3-Cash Dividends of Listed Companies
and the Notice of CSRC on Further Implementing Matters Related to Cash Dividends of Listed
Companies, the Articles of Association clarifies the specific profit distribution policy, decision-
making procedures and mechanism, adjustment of profit distribution policy, implementation of
profit distribution plan, and profit distribution for foreign shares. During the Reporting Period, the
Company executed the profit distribution policy in strict compliance with the Articles of
Association.
Special statement about the cash dividend policy
In compliance with the Company’s Articles of
Yes
Association and resolution of general meeting
Specific and clear dividend standard and ratio Yes
Complete decision-making procedure and mechanism Yes
Independent directors faithfully performed their duties
Yes
and played their due role
Non-controlling interests are able to fully express their
opinion and desire and their legal rights and interests Yes
are fully protected
In case of adjusting or changing the cash dividend
policy, the conditions and procedures involved are in Not applicable
compliance with applicable regulations and transparent
The profit distributions to ordinary shareholders, either in the form of cash or stock, in the
past three years (including the Reporting Period)
1. Dividend Payout Plan for 2018
As audited by Deloitte Touche Tohmatsu Certified Public Accountants LLP, the consolidated net
profit attributable to the Company as the parent for 2018 and the net profit of the Company as the
parent stood at RMB1, 090,418,910.77 and RMB71, 014,741.10 respectively.
(1) According to the Company Law and the Articles of Association of the Company, the Company
set aside RMB7,101,474.11 of profit as statutory reserve. The accumulative distributable profit of
the Company as the parent at the end of 2018 was RMB259,943,085.16.
(2) Base on the total 1,793,412,378 shares as at the end of 2018, a cash dividend of RMB1.14 (tax
60
China Merchants Port Group Co., Ltd. Annual Report 2020
included) was to be distributed for every 10 shares, totaling RMB204,449,011.09.
After the above-mentioned distribution, the retained earnings of the Company as the parent would
be RMB55,494,074.07.
The Board of Directors of the Company published the implementation announcement on dividend
payout for 2018 on Securities Times and Ta Kung Pao (HK) dated 3 July 2019, and completed the
dividend payout for the A-share and B-share holders on 10 July 2019 and 12 July 2019 respectively.
2. Dividend Payout Plan for 2019
As audited by Deloitte Touche Tohmatsu Certified Public Accountants LLP, the consolidated net
profit attributable to the Company as the parent for 2019 and the net profit of the Company as the
parent stood at RMB2, 898,192,168.84 and RMB1, 031,693,987.55 respectively.
(1) According to the Company Law and the Articles of Association of the Company, the Company
set aside RMB103,169,398.76 of profit as statutory reserve. The accumulative distributable profit of
the Company as the parent at the end of 2019 was RMB983,693,068.62.
(2) Base on the total 1,922,365,124 shares as at the end of 2019, a cash dividend of RMB4.60 (tax
included) was to be distributed for every 10 shares, totaling RMB884,287,957.04.
After the above-mentioned distribution, the retained earnings of the Company as the parent would
be RMB99,405,111.58.
The Board of Directors of the Company published the implementation announcement on dividend
payout for 2019 on Securities Times and Ta Kung Pao (HK) dated 9 July 2020, and completed the
dividend payout for the A-share and B-share holders on 15 July 2020 and 17 July 2020 respectively.
3. Dividend Payout Plan for 2020
As audited by Deloitte Touche Tohmatsu Certified Public Accountants LLP, the consolidated net
profit attributable to the Company as the parent for 2020 and the net profit of the Company as the
parent stood at RMB2,065,322,969.66 and RMB2,603,450,148.53 respectively.
(1) According to the Company Law and the Articles of Association of the Company, the Company
intends to set aside RMB260,345,014.85 of profit as statutory reserve. The accumulative
distributable profit of the Company as the parent at the end of 2020 was RMB2,442,510,245.26.
61
China Merchants Port Group Co., Ltd. Annual Report 2020
(2) Base on the total 1,922,365,124 shares as at the end of 2020, a cash dividend of RMB3.80 (tax
included) is to be distributed for every 10 shares, totaling RMB730,498,747.12.
After the above-mentioned distribution, the retained earnings of the Company as the parent will be
RMB1,712,011,498.14.
The above profit distribution plan still needs to be submitted to the 2020 Annual General Meeting
for approval.
Cash dividend for ordinary shareholders in the past three years (including the Reporting Period)
Unit: RMB
Net profit
Cash
attributable to
dividend
ordinary
s in other Total cash
Cash shareholders of
A as % of forms C as % of B dividends D as % of B
Year dividends (tax the listed
B (%) (such as (%) (including other (%)
inclusive) (A) company in
share forms) (D)
consolidated
repurcha
statements for
se) (C)
the year (B)
2020 730,498,747.12 2,065,322,969.66 35.37% 0.00 0.00% 730,498,747.12 35.37%
2019 884,287,957.04 2,898,192,168.84 30.51% 0.00 0.00% 884,287,957.04 30.51%
2018 204,449,011.09 1,090,418,910.77 18.75% 0.00 0.00% 204,449,011.09 18.75%
The Company was profitable in the Reporting period and the positive profits of the Company as the
parent attributable to ordinary shareholders while the distribution plan of cash dividend for ordinary
shareholders was not proposed.
Applicable √ Not applicable
II. Final Dividend Plan for the Reporting Period
Bonus shares/10shares (share) 0
Cash dividend/10 shares (RMB) (tax inclusive) 3.8
Bonus issue from capital reserves (share/10 shares) 0
Share base (share) 1,922,365,124
Total cash dividends (RMB) (tax inclusive) 730,498,747.12
Cash dividends in other forms (such as share
0.00
repurchase) (RMB)
Total cash dividends (including other forms)
730,498,747.12
(RMB)
Distributable profits (RMB) 2,442,510,245.26
Cash dividends (including other forms) as % of 100%
total profits to be distributed (%)
62
China Merchants Port Group Co., Ltd. Annual Report 2020
Details of the cash dividends
As the Company is in the mature stage of development with significant capital expenditures arrangement, when distributing profits,
the proportion of cash dividends in this profit distribution shall be 40% at least.
Details of final dividend plan for the Reporting Period
As audited by Deloitte Touche Tohmatsu Certified Public Accountants LLP, the consolidated net profit attributable to the Company
as the parent for 2020 stood at RMB2,065,322,969.66 and the net profit of the Company as the parent at RMB2,603,450,148.53.
(1) According to the Company Law and the Articles of Association of the Company, the Company intends to set aside
RMB260,345,014.85of profit as statutory reserve. The accumulative distributable profit of the Company as the parent at the end of
2020 was RMB2,442,510,245.26.
(2) Base on the total 1,922,365,124 shares as at the end of 2020, a cash dividend of RMB3.80 (tax included) is to be distributed for
every 10 shares, totaling RMB730,498,747.12.
After the above-mentioned distribution, the retained earnings of the Company as the parent will be RMB1,712,011,498.14.
The above profit distribution plan still needs to be submitted to the 2020 Annual General Meeting for approval.
III. Fulfillment of Commitments
1. Commitments of the Company’s Actual Controller, Shareholders, Related Parties, and
Acquirers, as well as the Company Itself and other Entities Fulfilled in the Reporting Period
or Ongoing at the Period-end
Date of
Type of Term of Fulfill
Commitment Promisor Details of commitment commitment
commitment commitment ment
making
The
commitment
on
safeguarding
independenc
e of CMPort
is effective
for a long
Commitment time; the
s on Commitment on safeguarding independence of CMPort commitment
CMGD horizontal made by CMGD and its person acting in concert on regulating
and competition, Broadford Global: to safeguard the independence of 15 March related-party Ongoi
Broadfor related-party finance, institutions, business and personnel of CMPort 2018 transactions ng
d Global transaction as well as independence and integrity of assets of is effective
and capital CMPort. during the
Commitment occupation period when
s made in CMGD and
acquisition its persons
documents acting in
or concert
shareholding possess
alteration control
documents power over
the Company
Commitment on regulating related-party transaction The
made by CMGD and corresponding persons acting in commitment
concert- Broadford Global: 1. CMGD/Broadford on
Commitment Global will make a great effort to reduce related-party safeguarding
s on transaction between CMGD/Broadford Global and its independenc
CMGD horizontal related parties as well as CMPort. Inevitable business e of CMPort
and competition, dealings or transactions shall be conducted as per 15 March is effective Ongoi
Broadfor related-party marketization principle and fair price and the obligation 2018 for a long ng
d Global transaction of information disclosure shall be fulfilled pursuant to time; the
and capital provisions; 2. CMGD/Broadford Global and its related commitment
occupation parties ensure they will strictly observe related on regulating
stipulations of laws, regulations, normative documents related-party
and Articles of Association of CMPort and equally transactions
execute shareholders' rights and fulfill shareholders' is effective
63
China Merchants Port Group Co., Ltd. Annual Report 2020
obligations together with other shareholders in line during the
with legal program as well as won't seek improper period when
interest with actual controller's status or damage CMGD and
legitimate interest of CMPort and other shareholders; 3. its persons
The above commitment is continuously effective acting in
during the period when CMGD/Broadford Global has concert
the right to control CMPort. In case of losses incurred possess
by CMGD/Broadford Global failing to fulfill the above control
commitment to CMPort, CMGD will bear power over
corresponding compensation responsibility. the Company
Commitment on regulating related-party transaction: 1.
China Merchants Group will try its best to reduce
related-party transaction between it and its related
parties and CMPort. Inevitable business dealings or
transactions shall be conducted as per marketization
principle and fair price and the obligation of
information disclosure shall be fulfilled pursuant to
Commitment
provisions; 2. China Merchants Group ensure they will
s on Effective
strictly observe related stipulations of laws, regulations,
horizontal until no-
normative documents and Articles of Association of
competition, 15 March longer to be Ongoi
CMG CMPort and equally execute shareholders' rights and
related-party 2018 the actual ng
fulfill shareholders' obligations together with other
transaction controller of
shareholders in line with legal program as well as won't
and capital the Company
seek improper interest with actual controller's status or
occupation
damage legitimate interest of CMPort and other
shareholders; 3. The above commitment is continuously
effective during the period when China Merchants
Group has the right to control CMPort. In case of losses
incurred by China Merchants Group failing to fulfill the
above commitment to CMPort, China Merchants Group
will bear corresponding compensation responsibility.
1. CMPort shares obtained by purchasing assets with
shares issued this time are forbidden to be transferred
or transacted in the market before the latter one
between the date arising 36 months after the date when
CMPort shares gained by CMPID based on this
transaction are registered under the name of CMPID
and the date when fulfillment of compensation
obligations set forth in the Impairment Compensation
Agreement for Issuing Shares To Purchase Assets
signed by and between CMPID and CMPort, separately
and its supplementary agreement (if any) is over
(except for repurchasing or presenting shares pursuant
to Impairment Compensation Agreement for Issuing
Shares To Purchase Assets and its supplementary
agreement (if any)); 2. In case of closing price of
Commitment Commitment CMPort stocks being lower than issue price for
s made in on restriction consecutive 20 transaction days within 6 months after 26 December Ongoi
CMPID completion of the transaction or such closing price 25 June 2022
time of asset on share 2018 ng
restructuring trading being lower than issue price at the end of the 6th month
after completion of the transaction, the lockup period of
CMPort stocks held by CMPID will be automatically
lengthened for at least 6 months; 3. CMPort shares
which derive from consideration shares obtained by
CMPID based on the transaction during the lockup
period due to CMPort distributing stock dividend and
capital reserve converted into increased capital shall be
subject to the commitment regarding the above
restricted stock trade period; 4. In case that the
transaction is placed on file for investigation and
prosecution by judiciary authorities as well as
registered and investigated by CSRC because false
record, misleading statement or important omission
happens to provided or disclosed information, CMPID
won't transfer its shares with rights and interests at
CMPort before case investigation conclusion is drawn;
64
China Merchants Port Group Co., Ltd. Annual Report 2020
5. In case that lockup period set forth in the
commitment is inconsistent with regulatory opinions
from securities market supervision department or
lockup period required by related provisions, CMPID
shall adjust the above lockup period pursuant to
regulatory opinions from relevant securities market
supervision department and related provisions. 6. After
the above lockup period expires, CMPID shall observe
provisions of laws and regulations, related rules of
Shenzhen Stock Exchange as well as Articles of
Association of CMPort in case of reducing shares held
by it.
Commitment on avoiding horizontal competition: 1.
CMPID and other enterprise controlled by CMPID fail
to engage in or participate in business or activity which
is similar with and constitutes or likely constitutes
competitive relation with main business conducted by
CMPort and the enterprise controlled by it now; 2.
CMPID will try its best to promote CMPID and other
enterprise controlled by CMPID not to directly or
indirectly engage in or participate in or assist to engage
in or participate in any business or activity which
constitutes or likely constitutes competitive relation
with main business conducted by CMPort and the
enterprise controlled by it now and in the future
independently or together with others; 3. In case of
discovering any new business opportunity which
constitutes or likely constitutes direct or indirect
competitive relation with main business of CMPort or
the enterprise controlled by it, CMPID or CMPID and
other enterprise controlled by it will immediately notify
CMPort in written as well as make a great effort to
promote such business opportunity to be provided to
CMPort or the enterprise controlled by it firstly
according to reasonable and fair terms and conditions;
Commitment 4. In case of CMPort or the enterprise controlled by it
Effective
s on waiving such competitive new business opportunity
until no-
horizontal and CMPID or/and other enterprise controlled by it
longer to be
competition, engaging in such competitive business, CMPort or the Ongoi
CMPID 26 July 2018 the largest
related-party enterprise controlled by it will have the right to ng
shareholder
transaction purchase any stock rights, assets or other rights and
of the
and capital interests in the above competitive business from
Company
occupation CMPID or/and other enterprise controlled by it once or
several times at any moment, or CMPort will select
entrusted operation, leasing or contract operation of
assets or businesses of CMPID or/and other enterprise
controlled by it in the above competitive business as
per the mode permitted by national laws and
regulations; 5. When CMPID and other enterprise
controlled by it plans to transfer, sell, rent out, conduct
licensed use of or transfer or allow to use assets and
businesses which constitutes or likely constitutes direct
or indirect competitive relationship with main business
of CMPort or the enterprise controlled by it in other
way, CMPID and other enterprise controlled by it will
provide the right of priority assignment to CMPort or
the enterprise controlled by it and promise to make a
great effort to promote other enterprise controlled by
CMPID provide CMPort or the enterprise controlled by
it with the right of priority assignment under the above
situation; 6. As of the date when the commitment letter
is provided, CMPID promises to compensate all actual
losses, damages and expenses arising from violation of
any clause in the commitment letter by CMPID or the
enterprise controlled by it to CMPort or the enterprise
controlled by it.
65
China Merchants Port Group Co., Ltd. Annual Report 2020
Commitment on regulating related-party transaction: 1.
CMPID and other enterprise controlled by it will make
a great effort to avoid and reduce related-party
transaction between CMPort and economic entity
controlled by it; 2. CMPID and other enterprise
controlled by it will exercise stockholder's rights in
accordance with related provisions of relevant laws and
regulations as well as Articles of Association of
CMPort and fulfill the obligation of vote avoidance at
the moment of voting for related-party transactions
involved by CMPID and other enterprise controlled by
it at the stockholders' meeting; 3. As for related-party
transaction which is inevitable or occurs due to
Commitment
reasonable reason, CMPID will carry out transaction Effective
s on
pursuant to the principle of openness, fairness and until no-
horizontal
justice for market transaction and based on fair and longer to be
competition, Ongoi
CMPID reasonable market price, perform related-party 26 July 2018 the largest
related-party ng
transaction decision-making process and legally fulfill shareholder
transaction
information disclosure obligation to safeguard benefits of the
and capital
of CMPort and other shareholders of CMPort in line Company
occupation
with provisions of laws, regulations, normative
documents and Articles of Association of CMPort; 4.
It's ensured that no legitimate interest of CMPort and
other shareholders of CMPort is damaged by related-
party transaction based on status and influence of
CMPort; 5. CMPID will promote other enterprise
controlled by it to observe the commitment of
Subparagraph 1-4; 6. In case of CMPID and other
enterprise controlled by it violating the above
commitment, causing rights and interests of CMPort
and its shareholders are damaged, CMPID will take
corresponding compensation responsibility according
to law.
Commitment about keeping independence of CMPort:
1. After the transaction is completed, CMPID will
strictly observe related provisions regarding
independence of listed Companies from CSRC and
won't violate standard operating procedures of CMPort
based on the first majority shareholder, conduct
excessive intervention of operation and management
activities of CMPort and its subsidiary, embezzle
benefits of CMPort and its subsidiary or damage
Commitment legitimate interest of CMPort and other shareholders; 2.
Effective
s on CMPID will ensure CMPort is independent from
until no-
horizontal CMPID and related parties in the aspects of business,
longer to be
competition, asset, finance, personnel and institution; 3. CMPID Ongoi
CMPID 26 July 2018 the largest
related-party ensures independence of CMPort, CMPID and other ng
shareholder
transaction enterprise controlled by it fail to occupy capitals and
of the
and capital resources of CMPort based on violation in any way and
Company
occupation will strictly observe provisions of rules and regulations
for avoiding occupation of related party funds from
CMPort as well as related laws, regulations and
normative documents; 4. The commitment letter takes
effect as of the signature date of CMPID as well as is
legally binding upon CMPID. CMPID ensures it will
strictly fulfill various commitments in the commitment
letter and will take corresponding legal responsibility
for losses incurred to CMPort due to violation of
related commitment.
Commitment Commitment on avoiding horizontal competition: 1. Effective
s on China Merchants Group and the enterprise controlled until no-
horizontal by it (excluding CMPort Holdings and the enterprise longer to be Ongoi
CMG competition, controlled it) fail to engage in or participate in any 26 July 2018
the actual ng
related-party business or activity which is similar with and controller of
transaction constitutes or likely constitute direct or indirect the Company
and capital competitive relationship with main business conducted
66
China Merchants Port Group Co., Ltd. Annual Report 2020
occupation by CMPort and the enterprise controlled by it now; 2.
China Merchants Group will try its best to promote
enterprises controlled by it(except for CMPort and the
enterprise controlled by it) not to directly or indirectly
engage in or participate in or assist to engage in or
participate in any business or activity which constitutes
or likely constitutes competitive relation with main
business conducted by CMPort and the enterprise
controlled by it now and in the future independently or
together with others; 3. In case of discovering any new
business opportunity which constitutes and likely
constitutes direct or indirect competitive relation with
main business of CMPort or the enterprise controlled
by it, China Merchants Group or enterprise controlled
by it(except for CMPort and the enterprise controlled
by it) will immediately notify CMPort in written as
well as make a great effort to promote such business
opportunity to be provided to CMPort or the enterprise
controlled by it firstly according to reasonable and fair
terms and conditions; 4. In case of CMPort or the
enterprise controlled by it waives such competitive new
business opportunity and China Merchants Group or
the enterprise controlled by it (except for CMPort and
the enterprise controlled by it) engaging in such
competitive business, CMPort or the enterprise
controlled by it will be entitled to purchase any
equities, assets and other rights and interests in the
above competitive business from China Merchants
Group or the enterprise controlled by it (except for
CMPort and the enterprise controlled by it) once or
several times at any moment or CMPort will select
entrusted operation, leasing or contract operation of
assets or businesses of China Merchants Group or the
enterprise controlled by it (except for CMPort and the
enterprise controlled by it) in the above competitive
business according to the mode permitted by national
laws and regulations; 5. When China Merchants Group
and the enterprise controlled by it (except for CMPort
and the enterprise controlled by it) plans to transfer,
sell, lease, allow to use or transfer or allow to use asset
and business which constitutes or likely constitutes
direct or indirect competitive relationship with main
business of CMPort or the enterprise controlled by it in
other way, China Merchants Group and the enterprise
controlled by it (except for CMPort and the enterprise
controlled by it) will provide the right of priority
assignment for CMPort or the enterprise controlled by
it and promise to make a great effort to promote the
enterprise controlled by China Merchants Group to
provide the of priority assignment for CMPort or the
enterprise controlled by it under the above situation; 6.
As of the date when the commitment letter is provided,
China Merchants Group promises to compensate all
actual losses, damages and expenses arising from
violation of any clause in the commitment letter by
China Merchants Group or the enterprise controlled by
it to CMPort or the enterprise controlled by it.
Commitment Commitment on regulating related-party transaction: 1.
s on China Merchants Group and other enterprise controlled Effective
horizontal by it will make a great effort to avoid and reduce until no-
competition, related-party transaction between CMPort and longer to be Ongoi
CMG economic entity controlled by it; 2. China Merchants 26 July 2018
related-party the actual ng
transaction Group and other enterprise controlled by it will controller of
and capital exercise stockholder's rights in accordance with related the Company
occupation provisions of relevant laws and regulations as well as
Articles of Association of CMPort and fulfill the
67
China Merchants Port Group Co., Ltd. Annual Report 2020
obligation of vote avoidance at the moment of voting
for related-party transactions involved by China
Merchants Group and other enterprise controlled by it
at the stockholders' meeting; 3. As for related
transaction which is inevitable or occurs due to
reasonable reason, China Merchants Group will carry
out transaction pursuant to the principle of openness,
fairness and justice for market transaction and based on
fair and reasonable market price, perform related-party
transaction decision-making process and legally fulfill
information disclosure obligation to safeguard benefits
of CMPort and other shareholders of CMPort in line
with provisions of laws, regulations, normative
documents and Articles of Association of CMPort; 4.
It's ensured that no legitimate interest of CMPort and
other shareholders of CMPort is damaged by related-
party transaction based on status and influence of
CMPort; 5. China Merchants Group promotes other
enterprise controlled by it to observe the commitment
set forth in Subparagraph 1-4 above; 6. In case of China
Merchants Group and other enterprise controlled by it
violating the above commitment, causing rights and
interests of CMPort and its shareholders are damaged,
China Merchants Group will take corresponding
compensation responsibility according to law.
Commitment about keeping independence of CMPort:
1. After the transaction is completed, China Merchants
Group will strictly observe related provisions regarding
independence of listed companies from CSRC and
won't violate standard operating procedures of CMPort
based on actual controller's status, conduct excessive
intervention of operation and management activities of
CMPort and its subsidiary, embezzle benefits of
CMPort and its subsidiary or damage legitimate interest
of CMPort and other shareholders; 2. China Merchants
Commitment Group will ensure CMPort is independent from China
s on Merchants Group and related parties in the aspects of Effective
horizontal business, asset, finance, personnel and institution; 3. until no-
competition, China Merchants Group ensures independence of longer to be Ongoi
CMG 26 July 2018
related-party CMPort, China Merchants Group and other enterprise the actual ng
transaction controlled by it fail to occupy capitals and resources of controller of
and capital CMPort based on violation in any way and will strictly the Company
occupation observe provisions of rules and regulations for avoiding
occupation of related party funds from CMPort as well
as related laws, regulations and normative documents;
4. The commitment letter takes effect as of the
signature date of China Merchants Group as well is
legally binding upon China Merchants Group. China
Merchants Group ensures it will strictly fulfill various
commitments in the commitment letter and will take
corresponding legal responsibility for losses incurred to
listed Company due to violation of related
commitment.
Commitment letter about perfecting the property
ownership certificate for land and house property of
CMPort Holdings and the enterprise subordinate to it:
1. China Merchants Group will spare no effort to assist, Effective
promote and drive CMPort Holdings and the enterprise until no-
Other subordinate to it to standardize, perfect and solve longer to be Ongoi
CMG 26 July 2018
commitment ownership defects of properties such as land and house the actual ng
property; 2. The following situations happen to CMPort controller of
Holdings and the enterprise subordinate to it before the Company
completion of the transaction: (1) Land use right of
ownership certificate which is being handled, the house
property failing to be timely handled (except for results
incurred by force majeure, law, policy, government
68
China Merchants Port Group Co., Ltd. Annual Report 2020
administration behavior and change in planned use of
the land instead of CMPort Holdings and the enterprise
subordinate to it); Or (2) Land use right of ownership
certificate, the property ownership certificate failing to
be handled (except for results incurred by force
majeure, law, policy, government administration
behavior and change in planned use of the land of
CMPort Holdings and the enterprise subordinate to it);
Or (3) In case of nonstandard other land use right and
house property (except for results incurred by force
majeure, law, policy, government administration
behavior and change in planned use of the land instead
of CMPort Holdings and the enterprise subordinate to
it) and encountering actual losses (including but not
limited to compensation, fine, expenditure and benefit
lost), China Merchants Group will timely and fully
compensate CMPort.
Commitment letter about real estate leased by CMPort
Holdings and the enterprise subordinate to it: In case of
nonstandard situation of the leased property
significantly influencing use of CMPort Holdings and
the Company subordinate to it to engage in operation of
normal business, China Merchants Group will actively
take effective measures (including but not limited to
arranging to provide the property with identical or
similar conditions to be used for operation of related
Company) to promote business operation of related
Effective
Company to be conducted normally and alleviate or
until no-
eliminate adverse effect; In case of nonstandard of the
Other longer to be Ongoi
CMG leased property causing CMPort Holdings and the 26 July 2018
commitment the actual ng
enterprise subordinate to it produce actual additional
controller of
expenditures or losses (such as third-party
the Company
compensation), China Merchants Group will actively
coordinate and negotiate with other related party to
support normal operation of CMPort Holdings and the
enterprise subordinate to it to the great extent and avoid
or control continuous enlargement of the damage; At
the same time, China Merchants Group agrees
compensate CMPort Holdings and the enterprise
subordinate to it in cash for actual losses incurred to
CMPort Holdings and the enterprise subordinate to it
for this reason to relieve or eliminate adverse effect.
Commitment letter about allotted land of the enterprise
subordinate to China Merchants Port Holdings
Company Limited from China Merchants Group: In
case that the above allotted land is withdrawn or needs
to be translated into assignment land due to policy
adjustment in the future after the transaction is
completed, China Merchants Group will actively
coordinate with CMPort and related companies such as
Effective
China Merchants Group International Port (Qingdao)
until no-
Co., Ltd. and Shantou CMPort Group Co., Ltd. to
Other longer to be Ongoi
CMG handle the transfer procedure or take other feasible 26 July 2018
commitment the actual ng
countermeasures. In case of any actual loss (excluding
controller of
land-transferring fees or rent, fees paid for taking rural
the Company
land, ownership registration fees, taxes and dues and
other related expenses to be paid by Chiwan Wharf or
above-mentioned related companies according to
provisions of laws and regulations) incurred to CMPort
or above-mentioned related companies for this reason,
China Merchants Group will timely and fully
compensate actual loss incurred to CMPort or above-
mentioned related companies.
Other Commitment letter about undertaking the accreditation 14 Effective Ongoi
CMG
commitment fees of property ownership certificate for the perfection September until no- ng
69
China Merchants Port Group Co., Ltd. Annual Report 2020
of the land and house property of CMPort Holdings and 2018 longer to be
the enterprise subordinate to it: In case of defective the actual
land use right and house property involved by the controller of
Company subordinate to CMPort Holdings on account the Company
of operation (namely land use right and house property
of the Company subordinate to CMPort Holdings
without complete ownership certificate existing before
the transaction is completed), incurring registration fees
such as taxes and dues, compensation and fine in the
process of perfecting legal procedures of defective land
use right and house property by the subordinate to
CMPort Holdings, China Merchants Group will timely
and fully compensate to the Company subordinate to
CMPort Holdings for undertaking.
Commitment letter about related matters of CMPort
after the transaction is completed: After the transaction
is completed, Chiwan Wharf will become port business
asset management headquarters and domestic capital
operation platform of China Merchants Group, deeply Three to five
participate in integration of domestic regional port years and
assets and enlarge the scale of domestic listed assets to CMG is the
make net profit of CMPort Holdings (00144.HK) actual
30
Other enjoyed as per the rights and interests in the controller of Ongoi
CMG September
commitment consolidated statement of listed Company in recent one the Company ng
2018
fiscal year fail to exceed 50% net profit of consolidated
statement of the listed Company and net asset of
CMPort Holdings (00144.HK) enjoyed in light of rights
and interests in the consolidated statement of listed
Company in recent one fiscal year fail to exceed 30%
net asset in the consolidated statement of the listed
Company within 3-5 years after the transaction is
completed.
China Merchants Group and all its directors,
supervisors and administrative officers ensure the
transaction report, its abstract, other information
provided for the transaction and application document
are true, accurate and complete without false record,
misleading statement or important omission as well as
take individual and joint legal liability for false record,
misleading statement or important omission. If the
information provided or disclosed by this transaction is
suspected of false records, misleading statements or
major omissions, and is investigated by the judicial
authorities or investigated by the China Securities
Regulatory Commission (CSRC), the directors,
supervisors or senior managers of China Merchants
Group do not transfer the shares that have interests in
listed Company, and submit the written application and
Other stock account of the suspension of the transfer to the Effective Ongoi
CMG 26 July 2018
commitment Board of Directors of the CMPort within two trading continuously ng
days after receiving the filing inspection notice, and the
Board of Directors shall apply for lock-up on behalf of
the CMG Hong Kong to the Stock Exchange and
Registration and Settlement Company. In case of
failing to file a locking application within two
transaction days and after the Board of Directors is
authorized for verification, identity information and
account information on directors, supervisors or
administrative officers of China Merchants Group will
be directly submitted to Stock Exchange and
Registration and Settlement Company with locking
applied; In case of Board of Directors failing to submit
identity information and account information on
directors, supervisors or administrative officers of
China Merchants Group to Stock Exchange and
Registration and Settlement Company, Stock Exchange
70
China Merchants Port Group Co., Ltd. Annual Report 2020
and Registration and Settlement Company will be
authorized to directly lock related shares. In case that
the situation of violating laws and rules is found upon
investigation conclusion, directors, supervisors or
administrative officers of China Merchants Group
promise locked shares are voluntarily used for
compensating related investors.
1. CMG Hong Kong ensures related information
provided for the transaction is true, accurate and
complete without false record, misleading statement or
important omission; 2. CMG Hong Kong ensures the
data provided to CMPort and all intermediary organs
participating in the transaction is true, accurate and
complete original written data or data copy. Data copy
is consistent with original data and signature and seal
of all the documents are true. The signatory of such
documents is legally authorized and effectively signs
such documents without any false record, misleading
statement or important omission; 3. CMG Hong Kong
ensures descriptions and confirmations issued for the
transaction is true, accurate and complete without false
record, misleading statement or important omission; 4.
CMG Hong Kong ensures that statutory disclosure and
report obligation has been performed, and no contracts,
agreements, arrangements or miscellaneous that should
have been disclosed exists; 5. The CMG Hong Kong
made the commitment that if the information provided
or disclosed by this transaction is suspected of false
records, misleading statements or major omissions, and
is investigated by the judicial authorities or investigated
by the China Securities Regulatory Commission
(CSRC), it does not transfer the shares that have
interests in listed Company, and submit the written
CMG application and stock account of the suspension of the
Other Effective Ongoi
Hong transfer to the Board of Directors of the CMPort within 26 July 2018
commitment continuously ng
Kong two trading days after receiving the filing inspection
notice, and the Board of Directors shall apply for lock-
up on behalf of the CMG Hong Kong to the Stock
Exchange and Registration and Settlement Company. In
case of failing to file a locking application within two
transaction days and after the Board of Directors is
authorized for verification, identity information and
account information on CMG Hong Kong will be
directly submitted to Stock Exchange and Registration
and Settlement Company with locking applied; In case
of Board of Directors failing to submit identity
information and account information on CMG Hong
Kong to Stock Exchange and Registration and
Settlement Company, Stock Exchange and Registration
and Settlement Company will be authorized to directly
lock related shares. If the investigation finds that there
is a violation of the law, CMG Hong Kong committed
to lock the shares voluntarily for the relevant investor
compensation; 6. If CMG Hong Kong promises to
related document, data and information provided in the
reorganization process aren't true, accurate or complete
or are with false record, misleading statement or
important omission, CMG Hong Kong is willing to
legally bear corresponding legal responsibility; 7. In
case of CMG Hong Kong violating the above promise,
incurring losses to CMPort, CMG Hong Kong will take
corresponding compensation responsibility.
1. CMPID ensures related information provided for the
Other transaction is true, accurate and complete without false 26 July 2018 Effective Ongoi
CMPID
commitment record, misleading statement or important omission; 2. continuously ng
CMPID ensures the data provided to CMPort and all
71
China Merchants Port Group Co., Ltd. Annual Report 2020
intermediary organs participating in the transaction is
true, accurate and complete original written data or data
copy. Data copy is consistent with original data and
signature and seal of all the documents are true. The
signatory of such documents is legally authorized and
effectively signs such documents without any false
record, misleading statement or important omission; 3.
CMPID ensures description and confirmation provided
for the transaction are true, accurate and complete
without any false record, misleading statement or
important omission; 4. CMPID ensures that statutory
disclosure and report obligation has been performed,
and no contracts, agreements, arrangements or
miscellaneous that should have been disclosed exists; 5.
The CMPID made the commitment that if the
information provided or disclosed by this transaction is
suspected of false records, misleading statements or
major omissions, and is investigated by the judicial
authorities or investigated by the China Securities
Regulatory Commission (CSRC), it does not transfer
the shares that have interests in CMPort, and submit the
written application and stock account of the suspension
of the transfer to the Board of Directors of the CMPort
within two trading days after receiving the filing
inspection notice, and the Board of Directors shall
apply for lock-up on behalf of the CMG Hong Kong to
the Stock Exchange and Registration and Settlement
Company. If the application for lock-up is not
submitted within two transaction days, the Board of
Directors is authorized to verify and submit the identity
information and account information of CMPID
directly to the Stock Exchange and Registration and
Settlement Company and apply for lock-up; If the
Board of Directors fails to submit the identity
information and account information of the CMPID to
the Stock Exchange and Registration and Settlement
Company, then the Stock Exchange and Registration
and Settlement Company shall be authorized to directly
lock the relevant shares. If the investigation finds that
there is a violation of the law, CMPID committed to
lock the shares voluntarily for the relevant investor
compensation; 6. If CMPID promises to related
document, data and information provided in the
reorganization process aren't true, accurate or complete
or are with false record, misleading statement or
important omission, CMPID is willing to legally bear
corresponding legal responsibility; 7. In case of
CMPID violating the above commitment, incurring
losses to CMPort, CMPID will take corresponding
compensation responsibility.
1. CMPort Holdings ensures related information
provided for the transaction is true, accurate and
complete without false record, misleading statement or
important omission; 2. CMPort Holdings ensures the
data provided to CMPort and all intermediary organs
participating in the transaction is true, accurate and
complete original written data or data copy. Data copy
CMPort Other is consistent with original data and signature and seal 26 July 2018 Effective Ongoi
Holdings commitment of all the documents are true. The signatory of such continuously ng
documents is legally authorized and effectively signs
such documents without any false record, misleading
statement or important omission; 3. CMPort Holdings
ensures description and confirmation provided for the
transaction are true, accurate and complete without any
false record, misleading statement or important
omission; 4. CMPort Holdings ensures that statutory
72
China Merchants Port Group Co., Ltd. Annual Report 2020
disclosure and report obligation has been performed,
and no contracts, agreements, arrangements or
miscellaneous that should have been disclosed exists; 5.
CMPort Holdings made the commitment that if the
information provided or disclosed by this transaction is
suspected of false records, misleading statements or
major omissions, and is investigated by the judicial
authorities or investigated by the China Securities
Regulatory Commission (CSRC); CMPort Holdings
committed that if CMPort Holdings violated the
above promise, incurring losses to CMPort, CMPort
Holdings will take corresponding compensation
responsibility.
1. China Merchants Group ensures related information
provided for the transaction is true, accurate and
complete without false record, misleading statement or
important omission; 2. China Merchants Group ensures
the data provided to CMPort and all intermediary
organs participating in the transaction is true, accurate
and complete original written data or data copy. Data
copy is consistent with original data and signature and
seal of all the documents are true. The signatory of such
documents is legally authorized and effectively signs
such documents without any false record, misleading
statement or important omission; 3. China Merchants
Group ensures descriptions and confirmations issued
for the transaction is true, accurate and complete
without false record, misleading statement or important
omission; 4. China Merchants Group ensures that
statutory disclosure and report obligation has been
performed, and no contracts, agreements, arrangements
or miscellaneous that should have been disclosed
exists; 5. China Merchants Group made the
commitment that if the information provided or
disclosed by this transaction is suspected of false
records, misleading statements or major omissions, and
is investigated by the judicial authorities or investigated
by the China Securities Regulatory Commission
Other (CSRC), it does not transfer the shares that have Effective Ongoi
CMG 26 July 2018
commitment interests in CMPort, and submit the written application continuously ng
and stock account of the suspension of the transfer to
the Board of Directors of the CMPort within two
trading days after receiving the filing inspection notice,
and the Board of Directors shall apply for lock-up on
behalf of China Merchants Group to the Stock
Exchange and Registration and Settlement Company. In
case of failing to file a locking application within two
transaction days and after the Board of Directors is
authorized for verification, identity information and
account information of China Merchants Group will be
directly submitted to Stock Exchange and Registration
and Settlement Company with locking applied; In case
of Board of Directors failing to submit identity
information and account information of China
Merchants Group to Stock Exchange and Registration
and Settlement Company, Stock Exchange and
Registration and Settlement Company will be
authorized to directly lock related shares. If the
investigation finds that there is a violation of the law,
China Merchants Group committed to lock the shares
voluntarily for the relevant investor compensation; 6. If
China Merchants Group promises to related document,
data and information provided in the reorganization
process aren't true, accurate or complete or are with
false record, misleading statement or important
omission, China Merchants Group is willing to legally
73
China Merchants Port Group Co., Ltd. Annual Report 2020
bear corresponding legal responsibility; In case of
China Merchants Group violating the above promise,
incurring losses to CMPort, China Merchants Group
will take corresponding compensation responsibility.
Chiwan Wharf and all its directors, supervisors and
administrative officers ensure the transaction report, its
abstract, other information provided for the transaction
and application document are true, accurate and
complete without false record, misleading statement or
important omission as well as take individual and joint
legal liability for false record, misleading statement or
important omission. If the information provided or
disclosed by this transaction is suspected of false
records, misleading statements or major omissions, and
is investigated by the judicial authorities or investigated
by the China Securities Regulatory Commission
(CSRC), the directors, supervisors, or senior managers
of Chiwan Wharf do not transfer the shares that have
interests in CMPort, and submit the written application
Chiwan and stock account of the suspension of the transfer to
Wharf the Board of Directors of the CMPort within two
and all trading days after receiving the filing inspection notice,
directors, and the Board of Directors shall apply for lock-up on
Other Effective Ongoi
superviso behalf of them to the Stock Exchange and Registration 26 July 2018
commitment continuously ng
rs and and Settlement Company. In case of failing to file a
senior locking application within two transaction days and
managem after the Board of Directors is authorized for
ent verification, identity information and account
information on directors, supervisors or administrative
officers of Chiwan Wharf will be directly submitted to
Stock Exchange and Registration and Settlement
Company with locking applied; In case of Board of
Directors failing to submit identity information and
account information on directors, supervisors or
administrative officers of Chiwan Wharf to Stock
Exchange and Registration and Settlement Company,
Stock Exchange and Registration and Settlement
Company will be authorized to directly lock related
shares. In case that the situation of violating laws and
rules is found upon investigation conclusion, directors,
supervisors or administrative officers of Chiwan Wharf
promise locked shares are voluntarily used for
compensating related investors.
CND Group will irrevocably and unconditionally
agrees it will ensure transferee of such land use right
China and its successor and assignee will be fully exempted 20 March
Nanshan from responsibility for the above matters in case of 2001; 18
Develop Other CMPort encountering losses, needing to bear expenses June 2003; Effective Ongoi
ment commitment and liabilities, undergoing claim for compensation or 29 continuously ng
(Group) needing to file a lawsuit due to any actual or potential September
Inc. illegal and unenforceable issues incurred by land use 2004
agreement and relevant documents signed and to be
Other signed by it.
commitment
s made to In order to properly solve the issue regarding the
minority ownership of the land of 270,692 square meters
shareholders transferred to CMPort by CND Group as a
China contribution, CND Group hereby irrevocably
Nanshan undertakes as follows:
Develop Other 1. CND Group affirms the historical fact that it Effective Ongoi
2 July 2020
ment commitment contributed to the restructuring and listing of Chiwan continuously ng
(Group) Wharf with the right to use 270,692 square meters of
Inc. land in 1993. Besides, it affirms that the 270,692 square
meters of land has been transferred to CMPort
(formerly known as Chiwan Wharf) and the right to use
the land is owned by CMPort. 2. CND Group will
74
China Merchants Port Group Co., Ltd. Annual Report 2020
continue keeping the original undertaking and ensure
that the signing of the relevant agreement will not
damage CMPort's rights and interests of 148,119 square
meters of land transferred in 1993 to CMPort (formerly,
Chiwan Wharf) as a contribution. 3. CND Group will
continue giving full play to its advantages to fully
support land-related authorities in Shenzhen City to
secure CMPort's right to use the 270,692 square meters
of land. Moreover, CND Group will continue to
actively assist CMPort in going through the
corresponding procedures for the change of ownership
of property rights and perfect legal procedures related
to the right to use the land (e.g., defining the boundary
line of land, land surveying, and claiming for the
certificate of land). In addition, CND Group undertakes
to cover all costs incurred accordingly (including the
land premium). 4. All consequent losses to CMPort
shall be borne by CND Group, should the latter break
the above undertaking. Furthermore, CND Group will
shoulder all liabilities for damage, if the asset integrity
of the listed company, CMPort, is damaged.
1. The company has agreed not to transfer the shares
subscribed within twelve months from the end date of
the issue (which refers to the listing date of the stock
issued) by CMPort. It has requested the Board of
CMPort to apply with the Shenzhen Branch of China
Securities Depository and Clearing Co., Ltd. (CSDC)
for locking the shares subscribed by the company to
China- Commitment
make sure that the aforementioned shares held by the
Africa of shares
company will not be transferred within twelve months
Develop lock-up and 4 November 3 November Expir
from the end date of the issue. 2. Except for the sell
ment share 2019 2020 ed
permitted by regulatory authorities that does not
Fund Co., reduction
constitute nonperformance or incomplete performance
Ltd. plan
of the aforementioned commitment, the company
undertakes that it will authorize CSDC to transfer the
fund from the sell into its account to be owned by all its
shareholders if it violates the aforementioned
commitment. 3. The company declares that it will
faithfully fulfill its commitment and bear corresponding
legal liabilities.
1. The company has agreed not to transfer the shares
subscribed within twelve months from the end date of
the issue (which refers to the listing date of the stock
issued) by CMPort. It has requested the Board of
CMPort to apply with the Shenzhen Branch of China
Securities Depository and Clearing Co., Ltd. (CSDC)
for locking the shares subscribed by the company to
Shenzhen
Commitment make sure that the aforementioned shares held by the
Infrastruc
of shares company will not be transferred within twelve months
ture
lock-up and from the end date of the issue. 2. The company 4 November 3 November Expir
Investme
share committed that as not fulfilling nonperformance or 2019 2020 ed
nt Fund
reduction incomplete performance of the aforementioned
Partnershi
plan commitment, the company shall compensate the direct
p (LP)
economic loss of other shareholders. The company
undertakes that if it violates the aforementioned
commitment, it will authorize CSDC to transfer the
fund from the sale into its account to be owned by all
shareholders. 3. The company declares that it will
faithfully fulfill its commitment and bear corresponding
legal liabilities.
Whether
fulfilled on Yes
time
Specific N/A
reasons for
75
China Merchants Port Group Co., Ltd. Annual Report 2020
failing to
fulfill
commitment
s on time
and plans for
next step
(if any)
2. Where there Had Been an Earnings Forecast for an Asset or Project and the Reporting
Period Was still within the Forecast Period, Explain why the Forecast Has Been Reached for
the Reporting Period.
Applicable √ Not applicable
IV. Occupation of the Company’s Capital by the Controlling Shareholder or Its Related
Parties for Non-Operating Purposes
Applicable √ Not applicable
During the Reporting Period, the controlling shareholder or its related parties did not occupy capital
or repay for non-operating purposes. Deloitte Touche Tohmatsu Certified Public Accountants LLP
issued the Special Report on Occupation of the Company’s Capital by the Controlling Shareholder
and Other Related Parties, and refer to www.cninfo.com.cn for details.
V. Explanations Given by the Board of Directors, the Supervisory Board and the Independent
Directors (if any) Regarding the Independent Auditor's “Modified Opinion” on the Financial
Statements of the Reporting Period
□ Applicable √ Not applicable
VI. YoY Changes to Accounting Policies, Estimates and Methods
On 14 April 2020, the Company held the 7th Meeting of the 9th Board of Directors and the 7th
Meeting of the 9th Supervisory Committee, where the Proposal on Changes in Accounting
Estimation of the Depreciable Life of Some Fixed Assets was considered and approved. In
accordance with the Accounting Standards for Business Enterprises No. 4 - Fixed Assets and the
Company’s related regulations, the Company reviewed the expected service life of its fixed assets
based on their performance and use conditions, and decided to make adjustment to the depreciable
life of some fixed assets to make it more reasonable, thus reflecting the Company’s financial
conditions and operating results in a more objective and fair manner. For the specific content, please
76
China Merchants Port Group Co., Ltd. Annual Report 2020
refer to the Announcement on Changes in Accounting Estimates of Depreciation Period of Partial
Fixed Assets (Announcement No.: 2020-037) published on www.cninfo.com.cn on 16 April 2020.
On 19 June 2020, the Ministry of Finance issued Provisions on the Accounting Treatment of the
COVID-19 Pandemic-related Rental Concessions in Cai Kuai [2020] File No.10 (hereinafter
referred to as "File No.10"). It's specified in File No. 10 that, for rental concessions, provided that
certain conditions are satisfied, an enterprise can conduct accounting treatment according to
Accounting Standards for Business Enterprises No. 21 — Leases, or adopt the simplified method
specified in File No.10. Where the enterprise adopts the simplified method, it's unnecessary to
assess whether there is lease changes or re-assess the lease classifications. The enterprise shall
apply the option to all the similar lease contracts and shall not change it arbitrarily.
For further information, please refer to (III) Changes in Significant Accounting Policies and
Accounting Estimates in Part XII Financial Statements for details.
VII. Retrospective Restatements due to Correction of Material Accounting Errors in the
Reporting Period
□ Applicable √ Not applicable
No such cases in the Reporting Period.
VIII. YoY Changes to the Scope of the Consolidated Financial Statements
On 19 November 2020, Cyber Chic, a subsidiary of the Company, and the other shareholders of
CMICT (Ningbo Port and CITIC Port Investment Co., Ltd.) resolved by way of shareholders'
resolutions to establish the Budget Committee, and entered into a Cooperation Agreement with
Ningbo Port (the “Cooperation Agreement”). The Budget Committee comprised three directors.
Each of the shareholders of CMICT nominated one director to be a member of the Budget
Committee, and the director nominated by Cyber Chic was the chairman. The Budget Committee is
primarily responsible for approving CMICT 's annual business plans, annual financial budgets and
final accounts, and after-tax profit distribution plans. Any matters to be considered by the Budget
Committee shall be approved by a two-thirds majority.
Pursuant to the Cooperation Agreement, Cyber Chic and Ningbo Port will consult and communicate
77
China Merchants Port Group Co., Ltd. Annual Report 2020
among themselves to reach consensus before exercising their shareholders' rights. If the parties to
the Cooperation Agreement cannot reach consensus on any matter in relation to CMICT’s
operations and management, the matter shall be decided in accordance with the opinion of Cyber
Chic. No consideration was payable by either party under the Cooperation Agreement. Upon the
completion of the Cooperation Agreement, Cyber Chic and Ningbo Port together had an over-50%
interest in CMICT. Accordingly, the Company has included CMICT into its consolidated financial
statements since 19 November 2020, and CMICT has since become a subsidiary instead of a joint
venture of the Company, with the Company’s interest in CMICT remaining the same.
IX. Engagement and Disengagement of Independent Auditor
Current independent auditor
Deloitte Touche Tohmatsu Certified Public
Name of the domestic independent auditor
Accountants LLP
The Company’s payment to the domestic independent auditor
639.53
(RMB’0,000)
How many consecutive years the domestic independent auditor
9
has provided audit service for the Company
Names of the certified public accountants from the domestic
Li Weihua, Zhang Min
independent auditor writing signatures on the auditor’s report
How many consecutive years the certified public accountants
2
have provided audit service for the Company
Name of the overseas independent auditor (if any) Deloitte Touche Tohmatsu
The Company’s payment to the overseas independent auditor
362.26
(RMB’0,000) (if any)
How many consecutive years the overseas independent auditor
9
has provided audit service for the Company (if any)
Names of the certified public accountants from the overseas
independent auditor writing signatures on the auditor’s report (if Yu Jianmin
any)
How many consecutive years the certified public accountants
1
have provided audit service for the Company (if any)
Indicate by tick mark whether the independent auditor was changed for the Reporting Period.
□ Yes √ No
Independent auditor, financial advisor or sponsor engaged for the audit of internal controls:
Approved by the 7th Meeting of the 9th Board of Directors in 2020 and 2019 Annual General
Meeting of the Company, the Company was allowed to continuously engage Deloitte Touche
Tohmatsu Certified Public Accountants LLP as the 2020 independent auditor for the audit of annual
financial statements and internal control in the 2020. The audit price for 2020 annual financial
statements was RMB9.6379 million and the price for internal control was RMB0.38 million. The
total expense on aforesaid two audit work was RMB10.0179 million.
78
China Merchants Port Group Co., Ltd. Annual Report 2020
X. Possibility of Delisting after Disclosure of this Report
□ Applicable √ Not applicable
XI. Insolvency and Reorganization
□ Applicable √ Not applicable
No such cases in the Reporting Period.
XII. Major Legal Matters
□ Applicable √ Not applicable
No such cases in the Reporting Period.
Other legal matters
Situation of
Whether Trial results and
Lawsuit execution of Disclo Disclo
Basic situation of form into Process of lawsuit influences of
amount (RMB judgment of sure sure
lawsuit (arbitration) estimated (arbitration) lawsuit
‘0,000) lawsuit date index
liabilities (arbitration)
(arbitration)
Summary of Brazil Relatively low
21,310.97 Yes In progress - - -
TCP Case (note) risk
Summary of other
matters not meeting
Part was
the disclosure Relatively low
6,043.20 No completed, and - - -
standards for major risk
part is in progress
lawsuits
(arbitrations)
Note: This represents the significant contingent liabilities arising from the litigations between TCP and its
subsidiaries and local tax authority, employee or former employee of TCP and its subsidiaries in Brazil at as the
year end. According to the latest estimates of the Company’s management, the possible compensation is
RMB213,109,668.45 but it is not likely to cause outflow of economic benefits from the Company. Therefore, the
contingent liabilities arising from the above pending litigations are not recognized as provisions. The counter-
bonification where the Company as the beneficiary will be executed by the former TCP shareholder that disposed
the shares. According to the counter-bonification agreement, the former TCP shareholder need to make counter-
bonification to the Company in respect of the above contingent liabilities, with the compensation amount not
exceeding pre-determined amount and specified period.
XIII. Punishments and Rectifications
□ Applicable √ Not applicable
No such cases in the Reporting Period.
XIV. Credit Quality of the Company as well as Its Controlling Shareholder and Actual
Controller
□ Applicable √ Not applicable
79
China Merchants Port Group Co., Ltd. Annual Report 2020
XV. Equity Incentive Plans, Employee Stock Ownership Plans or Other Incentive Measures
for Employees
The Company is implementing the stock option incentive plan, and the review and approval
procedures carried out in connection with the Stock Option Incentive Plan are as follows:
(1) At the 2nd Meeting of the Nomination, Remuneration and Appraisal Committee of the 9th Board
of Directors in 2019 held on 10 October 2019, the following proposals were considered and
approved, including Stock Option Incentive Plan of CMPort (Draft) (hereinafter referred to as the
“Stock Option Incentive Plan (Draft)”) and its summary, Stock Option Incentive Plan of CMPort
(Phase I) (Draft) (hereinafter referred to as the “Stock Option Incentive Plan (Phase I) (Draft)”) and
its summary, Management Measures for the Stock Option Incentive Plan of CMPort (hereinafter
referred to as the “Management Measures for the Stock Option Incentive Plan”), Appraisal
Measures for Implementing the Stock Option Incentive Plan and Implementation Appraisal
Measures of Stock Option Incentive Plan by China Merchants Port Group Co., Ltd. (hereinafter
referred to as “Implementation Appraisal Measures of Stock Option Incentive Plan”).
(2) At the 9th Extraordinary Meeting of the 9th Board of Directors in 2019 held on 11 October 2019,
the following proposals were reviewed and approved, including Stock Option Incentive Plan (Draft)
and its summary, Stock Option Incentive Plan (Phase I) (Draft) and its summary, Management
Measures for the Stock Option Incentive Plan, Implementation Appraisal Measures of Stock Option
Incentive Plan, and Proposal on Requesting the General Meeting to Authorize the Board of
Directors to Go Through Share Incentive Procedures, and independent directors expressed
independent opinions. At the 2nd Extraordinary Meeting of the 9th Supervisory Committee in 2019
held on the same day, the following proposals were reviewed and approved, including Stock Option
Incentive Plan (Draft) and its summary, Stock Option Incentive Plan (Phase I) (Draft) and its
summary, Management Measures for the Stock Option Incentive Plan, and Implementation
Appraisal Measures of Stock Option Incentive Plan, and the List of Incentive Objects under the
Stock Option Incentive Plan (Phase I) was reviewed with opinions expressed. Refer to the relevant
announcements (Announcement No. 2019-069, No. 2019-070) disclosed on www.cninfo.com.cn for
details.
(3) On 3 January 2020, the Company received Approval on the Implementation of Stock Option
Incentive Plan of CMPort (GZKF [2019] No. 748) issued by the State-owned Assets Supervision
80
China Merchants Port Group Co., Ltd. Annual Report 2020
and Administration Commission of the State Council from China Merchants Group, the actual
controller of the Company. In principle, approval was given to the Company for its implementation
of the Stock Option Incentive Plan and performance appraisal goals under the Plan. Refer to the
relevant announcement (Announcement No. 2020-001) disclosed on www.cninfo.com.cn for details.
(4) At the 1st Extraordinary Meeting of the 9th Board of Directors in 2020 held on 9 January 2020,
Stock Option Incentive Plan (Phase I) (Revised Draft) and its summary were reviewed and
approved, and independent directors expressed independent opinions. At the 1st Extraordinary
Meeting of the 9th Supervisory Committee in 2020 held on the same day, Stock Option Incentive
Plan (Phase I) (Revised Draft) and its summary were reviewed and approved and List of Incentive
objects under the Stock Option Incentive Plan (Phase I) (After Adjustment) was reviewed with
opinions expressed. Refer to the relevant announcements (Announcement No. 2020-002, No. 2020-
003, No. 2020-004) disclosed on www.cninfo.com.cn for details.
(5) On 20 January 2020, the Company disclosed the Announcement on Notes of the Supervisory
Committee on the Review and Publicity of the List of Incentive Objects under the Stock Option
Incentive Plan (Phase I). The Supervisory Committee reviewed the list of incentive objects for the
first grant. The Company published the names and positions of the incentive objects for the first
grant of the stock option in its internal OA system from 10 January to 19 January 2020. By the end
of the publicity, the Company’s Supervisory Committee had not received any objection against the
incentive objects for the first grant. Refer to the relevant announcement (Announcement No. 2020-
009) disclosed on www.cninfo.com.cn for details.
(6) At the 1st Extraordinary General Meeting of 2020 held on 3 February 2020, the following
proposals were considered and approved, including Stock Option Incentive Plan (Draft) and its
summary, Stock Option Incentive Plan (Phase I) (Revised Draft) and its summary, Management
Measures for the Stock Option Incentive Plan, Implementation Appraisal Measures of Stock Option
Incentive Plan, and Proposal on Requesting the General Meeting to Authorize the Board of
Directors to Go Through Share Incentive Procedures. The Company’s Stock Option Incentive Plan
was approved and the Board of Directors was authorized to determine the grant date, grant stock
option to the incentive objects when they meet the conditions and go through all procedures
required for the grant. On the same day, the Company disclosed Self-inspection Report on the
81
China Merchants Port Group Co., Ltd. Annual Report 2020
Trading of the Company’s Shares by Insiders and Incentive Objects of the Stock Option Incentive
Plan (Phase I) according to its verification of the trading engaged by the insiders and incentive
objects. Refer to the relevant announcement (Announcement No. 2020-011) disclosed on
www.cninfo.com.cn for details.
(7) At the 2nd Extraordinary Meeting of the 9th Board of Directors in 2020 and the 2nd Extraordinary
Meeting of the 9th Supervisory Committee in 2020 held on 3 February 2020, the Proposal on the
Grant of Stock Option (the First Grant) to Incentive Objects of the Stock Option Incentive Plan of
the Company was considered and approved respectively. The Company’s Board of Supervisors
reviewed the list of incentive objects under the Stock Option Incentive Plan (Phase I) on the grant
date and expressed opinions, and independent directors expressed independent opinions. Refer to
the relevant announcements (Announcement No. 2020-012, No. 2020-013, No. 2020-014) disclosed
on www.cninfo.com.cn for details.
(8) On 14 March 2020, the Company has completed registration for the grant of stock option (the
first grant) under the Stock Option Incentive Plan (Phase I). Refer to the Announcement on
Completion of the Grant of Stock Option (the First Grant) under the Stock Option Incentive Plan
(Phase I) of the Company (Announcement No. 2020-020) disclosed on www.cninfo.com.cn for
details.
(9) At the 1st Extraordinary Meeting of the 10th Board of Directors in 2021 and the 1st Extraordinary
Meeting of the 10th Supervisory Committee in 2021 held on 29 January 2021, the Proposal on
Adjusting the Exercise Price of the First Grant under the Stock Option Incentive Plan (Phase I) and
the Proposal on the Grant of Stock Option (the Reserved) to Incentive Objects of the Stock Option
Incentive Plan (Phase I) of the Company were considered and approved respectively. The
Supervisory Committee reviewed the list of incentive objects for the reserved stock options under
the Stock Option Incentive Plan (Phase I) on the grant date, and independent directors expressed
independent opinions. Refer to the relevant announcements (Announcement No. 2021-007, No.
2021-008) disclosed on www.cninfo.com.cn for details.
(10) On 9 February 2021, the Company disclosed the Announcement on Notes of the Supervisory
Committee on the Review and Publicity of the List of Incentive Objects for the Reservation under
the Stock Option Incentive Plan (Phase I) (Announcement No. 2021-009). The Company published
82
China Merchants Port Group Co., Ltd. Annual Report 2020
the names and positions of the incentive objects for reserved stock options in its internal OA system
from 29 January 2021 to 8 February 2021. By the end of the publicity, the Company’s Supervisory
Committee had not received any objection against the incentive objects for reserved stock options.
Refer to the relevant announcement (Announcement No. 2021-009) disclosed on
www.cninfo.com.cn for details.
(11) 5 March 2021, the Company has completed registration for the grant of stock option (the
reserved) under the Stock Option Incentive Plan (Phase I). Refer to the Announcement on
Completion of the Grant of Stock Option (the Reserved) under the Stock Option Incentive Plan
(Phase I) of the Company (Announcement No. 2021-013) disclosed on www.cninfo.com.cn for
details.
XVI. Major Related-Party Transactions
1. Continuing Related-Party Transactions
As %
of the
Relat
total Obtainabl
ionsh Type Approved Over
value Way e market
ip of Specific Pricing Total value transaction the Index to
Related Transacti of all of price for
with trans transactio principl (RMB’0,00 line approve Disclosure date disclosed
party on price the settle same-type
the actio n e 0) (RMB’0,0 d line or information
same- ment transactio
Com n 00) not
type ns
pany
transact
ions
CHINA
COSCO www.cninfo
Affili Lease,
SHIPPIN Rend Settle .com.cn
ated labor
G er Market d (Announce
legal service, 47,308.92 47,308.92 43.66% 37,799.33 Yes 47,308.92 16 April 2020
GROUP servi price month ment
perso testing
and its ce ly No.2020-
n fee, etc.
subsidiar 031)
ies
Rend
er
China servi
Unde
Merchant ce to
r the Labor
s Shekou relate www.cninfo
contr cost,
Industrial d Settle .com.cn
ol of lease
Zone party Market d (Announce
ultim expense 8,715.03 8,715.03 7.56% 16,127.05 No 8,715.03 16 April 2020
Holdings and price month ment
ate of land
Co., Ltd. lease ly No.2020-
share and
and its land 031)
holde houses
subsidiar to
r
ies relate
d
party
Rend
er
servi Labor
Antong ce to cost, www.cninfo
Affili
Holdings relate freight Settle .com.cn
ated
Co., Ltd. d forwardin Market d (Announce
legal 12,779.54 12,779.54 12.90% 9,154.30 Yes 12,779.54 16 April 2020
and its party g agent, price month ment
perso
subsidiar and Port ly No.2020-
n
ies recei service 031)
ve charge
servi
ce
83
China Merchants Port Group Co., Ltd. Annual Report 2020
Total -- -- 68,803.49 -- 63,080.68 -- -- -- -- --
Large-amount sales return in
None
detail
The Proposal on Recognition of 2019 Daily Related-party Transaction and the Forecast of 2020 Daily Related-party
Transaction was reviewed and approved on the 7th Meeting of the 9th Board of Directors on 14 April 2020, which
Give the actual situation in the
allowed the Company and subsidiaries to conduct daily business transactions with related-parties, transactions
Reporting Period (if any) where
including office leasing, software procurement and labor cost. The amount of daily related-party transactions in 2020
an estimate had been made for
is estimated to be RMB975 million. The actual amount of the above related-parties daily transactions was RMB1.153
the total value of continuing
billion. Due to the actual market demand and business development requirement, there were differences existed
related-party transactions by type
because of the normal management adjustment, without major influences to the daily operation and performance of
to occur in the Reporting Period
the Company. Refer to Announcement on Recognition of Daily Related-party Transactions in 2020 and the Forecast
of Daily Related-party Transactions in 2021 disclosed on www.cninfo.com.cn dated 31 March 2021.
Reason for any significant
difference between the
N/A
transaction price and the market
reference price (if applicable)
2. Related-Party Transactions Regarding Purchase or Sales of Assets or Equity Interests
□ Applicable √ Not applicable
3. Related Transactions Regarding Joint Investments in Third Parties
Registered Net
Total assets
Related capital of Net assets of profit of
Co- Name of of investees
relation Main business of investees investees investees investees
investor investees (RMB’0,00
ship (RMB’0,0 (RMB’0,000) (RMB’0,
0)
00) 000)
Investment and assets
management; land
development services; park
management service;
Under China electricity, heat power and
the Merchants water supply; engineering
ultimate Northeast management service; property
Liaoning
control Asia management; plant leasing;
Port Group 450,000 450,276.51 450,207.39 207.39
of same Developm meetings, exhibitions and
Co., Ltd.
actual ent relevant services;
controll Investmen management consulting
er t Co., Ltd. services. (for project subject
to approval of laws, business
activities are allowed to carry
out with the approval of
relevant departments
Investment and assets
management; land
development services; park
management service;
Under China electricity, heat power and
China
the Merchants water supply; engineering
Merchants
ultimate Northeast management service; property
Shekou
control Asia management; plant leasing;
Industrial 450,000 450,276.51 450,207.39 207.39
of same Developm meetings, exhibitions and
Zone
actual ent relevant services;
Holdings
controll Investmen management consulting
Co., Ltd.
er t Co., Ltd. services. (for project subject
to approval of laws, business
activities are allowed to carry
out with the approval of
relevant departments
China Under China Mainly engage in investments
Merchants the Merchants in equity of listed and unlisted 60,012 - - -
Venture ultimate Port enterprises; the investment
Capital control (Shenzhen direction of fund mainly
84
China Merchants Port Group Co., Ltd. Annual Report 2020
Manageme of same ) involves in wharf-related
nt Co., Ltd. actual Industrial industries, technological
controll Innovatio innovation, business model
er n Private innovation and trade
Equity digitalization projects
Investmen
t Fund
Partnershi
p (Limited
Partnershi
p)
China
Merchants
Port
Shenzhen
(Shenzhen Mainly engage in investments
China Under
) in equity of listed and unlisted
Merchants the
Industrial enterprises; the investment
Venture ultimate
Innovatio direction of fund mainly
Capital control
n Private involves in wharf-related 60,012 - - -
Fund of same
Equity industries, technological
Center actual
Investmen innovation, business model
(Limited controll
t Fund innovation and trade
Partnership er
Partnershi digitalization projects
)
p (Limited
Partnershi
p)
4. Credits and Liabilities with Related Parties
Whether there are credits and liabilities with non-operating related parties
√Yes □ No
Credits receivable with related parties
Whether
Recovered in Interest in
there is
Beginning Increased in the the Ending
occupation
Related Related Forming balance the Reporting Reporting Interest Reporting balance
on non-
party relationship reason (RMB’0,00 Period Period rate Period (RMB’0,000
operating
0) (RMB’0,000) (RMB’0,000 (RMB’0,00 )
capital or
) 0)
not
Other
China company
Merchants under the
Bank
Group control of the No 89,006.52 953,449.44 885,563.54 1.64% 1,707.16 156,892.42
deposits
Finance same
Co., Ltd. controlling
shareholder
The ultimate
controlling Bank
China
shareholder deposits/
Merchants No 298,084.80 2,619,690.22 2,642,778.01 2.03% 2,507.79 274,997.01
has major Structural
Bank
influence on deposits
it
Effects of credits with
related parties on the
The above credits receivables with related parties were mainly deposits in financial institutions that
Company’s operating
have no major influence on the Company’s operating results and financial conditions.
results and financial
conditions
Liabilities payable with related parties
Beginning Increased in Recovered in Interest in Ending
Related Forming
Related party balance the Reporting the Reporting Interest rate the Reporting balance
relationship reason
(RMB’0,000) Period Period Period (RMB’0,000)
85
China Merchants Port Group Co., Ltd. Annual Report 2020
(RMB’0,000) (RMB’0,000) (RMB’0,000)
Other
company
China
under the
Merchants
control of the Borrowing 121,756.34 318,718.02 121,976.02 4.00% 4,021.81 318,498.34
Group Finance
same
Co., Ltd.
controlling
shareholder
The ultimate
controlling
China
shareholder
Merchants Borrowing 9,009.30 1,894 0 3.41% 282.09 10,903.32
has major
Bank
influence on
it
Effects of liabilities with
related parties on the The above liabilities payables with related parties were mainly financial institution loans that have no
Company’s operating results major influence on the Company’s operating results and financial conditions.
and financial conditions
5. Other Major Related-Party Transactions
(1) The Company established Northeast Asia Investment through investments together with its
related parties Liaoning Port Group and CMSK. The registered capital of Northeast Asia Investment
is RMB4.5 billion, among which RMB1 billion is subscribed by the Company accounting for
22.22% of the registered capital.
(2) The Company and subsidiaries opened the accounts at China Merchants Bank. In 2020, the
maximum outstanding of deposits at China Merchants Bank did not exceed RMB5 billion and the
maximum loan balance did not exceed RMB10 billion.
(3) The Company intends to lend its self-raised funds to Jinyu Rongtai, China Merchants Port
Development (Shenzhen) Co., Ltd., Zhangzhou Port, and Shunde New Port that are wholly-
owned/majority-owned subsidiaries of CMPort Holdings, a majority-owned subsidiary of the
Company, and provide financial assistance to CMPort (Zhoushan) RoRo Logistics Co., Ltd.,
another majority-owned subsidiary of the Company, to supplement working capital and replace
loans. The Company disclosed the Announcement on Financial Assistance to Subsidiaries and
Related-party Transactions on 30 April 2020. The above financial assistance was deliberated and
passed at the 4th Extraordinary Meeting of the 9th Board of Directors in 2020 and 2019 Annual
General Meeting of Shareholders. Thus far, the above financial assistance has not been
implemented.
(4) The Company, its related party, China Merchants Venture, and China Merchants Venture Fund
managed by China Merchants Venture plan to jointly invest and establish China Merchants Port
86
China Merchants Port Group Co., Ltd. Annual Report 2020
(Shenzhen) Industry Innovation Private Equity Investment Fund Partnership (Limited Partnership)
(This is a tentative name. The ultimate name is subject to industrial and commercial registration.)
The investment fund will invest in quality projects in wharf-related industries, the innovation of
technologies and business models, and trade digitalization. China Merchants Venture will serve as
the fund manager.
The AUM of the fund is RMB600.12 million, wherein China Merchants Venture, as the fund
manager, general partner, and managing partner plans to contribute RMB120,000, while CMPort, as
a limited partner, and China Merchants Venture Fund, as a limited partner, intend to contribute
RMB300 million each. The fund plans to engage Shenzhen Chiwan Port Development Co., Ltd., a
wholly-owned subsidiary of the Company, as its investment consultant.
(5) China Merchants Holdings (International) Information Technology Co., Ltd. (CMHIT), a
majority-owned subsidiary of the Company, intends to attract investors, Jifa Logistics and Yingkou
Port Group, through an increase in capital and share. Jifa Logistics, Dalian Port Container
Development Co., Ltd. (DPCD), and Yingkou Port Group are majority-owned subsidiaries of the
Company's related party, Liaoning Port Group. Particularly, Jifa Logistics, DPCD, and Yingkou Port
Group will use 29.40%, 49.63% of their shares in DPN, and 100% of the equity in Yingkou Port
Information Technology Co., Ltd. (YPIT) respectively to increase the capital of CMHIT. Upon
completion of this capital increase, the registered capital of CMHIT will be changed to RMB87,
848,200. The equity ratios of the Company, CMPort Holdings, Jifa Logistics, DPCD, and Yingkou
Port Group in CMHIT will become 13.18%, 43.74%, 13.26%, 22.38%, and 7.44%, respectively.
The sum of the equity ratios of the Company and CMPort Holdings will reach 56.92%, while that of
the rest shareholders will reach 43.08%. CMHIT will remain a majority-owned subsidiary of the
Company. DPN and YPIT will become CMHIT's majority-owned subsidiary and wholly-owned
subsidiary, respectively.
(6) CMHD, an indirect wholly-owned subsidiary of CMPort Holdings that is a majority-owned
subsidiary of the Company, proposes to jointly invest to incorporate RSW in Djibouti, together with
OHD, an indirect wholly-owned subsidiary of Dafeng International Co., Ltd. that is a wholly-owned
subsidiary of the company's related party, CMSK, and DNC, a wholly-owned subsidiary of Great
Horn Investment Holding S.A.S., a non-related party of the Company. The registered capital of
87
China Merchants Port Group Co., Ltd. Annual Report 2020
RSW in the first phase will be the amount in DJF equivalent to USD14,000. DNC, CMHD, and
OHD will hold 60%, 23.5%, and 16.5% of the equity, respectively. In this phase, DNC, CMHD, and
OHD will contribute USD8,400, USD3,290, and USD2,310 with their own funds. Upon registration
and incorporation of RSW, DNC, CMHD, and OHD will raise the registered capital of RSW. They
will start the second phase of contribution of USD120 million in total to RSW. Specifically, DNC,
CMHD, and OHD will contribute USD72 million, USD28.2 million, and USD19.8 million, with
their equity ratios will remain unchanged.
Information on the disclosure website for current announcements on significant related-party
transactions:
Name of provisional reports Disclosure date Website
Announcement on Establishing a Joint Venture
www.cninfo.com.cn (Announcement
and Related-party Transaction jointly with 7 April 2020
No. 2020-025)
Related Parties through Investments
Announcement on Deposit and Loan of Related-
www.cninfo.com.cn (Announcement
party Transaction in 2020 at China Merchants 16 April 2020
No. 2020-032)
Bank
Announcement on Financial Assistance and www.cninfo.com.cn (Announcement
30 April 2020
Related-party Transaction to the Subsidiary No. 2020-045)
Announcement on Establishing a Investment
www.cninfo.com.cn (Announcement
Fund and Related-party Transaction jointly with 1 December 2020
No. 2020-085)
Related Parties through Investments
Announcement on Capital Increase in the
www.cninfo.com.cn (Announcement
Subsidiary and Related-party Transaction by the 19 December 2020
No. 2020-089)
Related Parties
Announcement on Establishing a Joint Venture
and Related-party Transaction by the Majority- www.cninfo.com.cn (Announcement
30 December 2020
owned Subsidiary jointly with Related Parties No. 2020-091)
through investments
XVII. Major Contracts and Execution thereof
1. Entrustment, Contracting and Leases
(1) Entrustment
Details of entrustment
On 13 December 2018, the Company held the 10th Extraordinary Meeting of the 9th Board of
Directors, on which the Proposal on Signing Custody Agreement of Equity of Liaoning Port Group
Co., Ltd. between the Company and China Merchants (Liaoning) Port Development Co., Ltd. was
reviewed and approved. The Company was allowed to sign the Custody Agreement of Equity of
Liaoning Port Group Co., Ltd. with China Merchants (Liaoning) Port Development Co, Ltd., the
88
China Merchants Port Group Co., Ltd. Annual Report 2020
indirect wholly-owned subsidiary of CMG, and made an appointment that China Merchants
(Liaoning) Port Development entrusted all 49.9% shares of Liaoning Port Group Co., Ltd. held by it
as of 13 December 2018 to the Company for management.
Project which generates profit or loss reaching over 10% of total profits of the Company during the
Reporting Period
□ Applicable √ Not applicable
No such cases in the Reporting Period.
(2) Contracting
□ Applicable √ Not applicable
No such cases in the Reporting Period.
(3) Leases
□ Applicable √ Not applicable
No such cases in the Reporting Period.
2. Major guarantees
(1) Guarantees
Unit: RMB’0,000
Guarantees provided by the Company and its subsidiaries for external parties (exclusive of those for subsidiaries)
Disclosure Guarant
date of the Actual Actual Having ee for a
guarantee Line of Type of Term of
Obligor occurrence guarantee expired related
line
guarantee guarantee guarantee
announce date amount or not party or
ment
not
General About 20
Terminal Link SAS N/A 7,100.40 11 June 2013 7,100.40 Not Not
guarantee years
KHOR AMBADO 30 March Joint- About 13
18,791.78 24 May 2019 11,312.58 Not Yes
FZCO 2019 liability years
Total actual balance of
Total approved line for such
such guarantees at the
guarantees at the end of the 25,892.18 18,412.98
end of the Reporting
Reporting Period (A3)
Period (A4)
Guarantee between the Company to its subsidiaries
Disclosure Actual Actual Having Guarant
Line of Type of Term of
Obligor date of the occurrence guarantee expired ee for a
guarantee guarantee guarantee
guarantee date amount or not related
89
China Merchants Port Group Co., Ltd. Annual Report 2020
line party or
announce not
ment
Chiwan Wharf
16 April Joint- About 1
Holdings (Hong 400,000.00 28 July 2020 150,000.00 Not Not
2020 liability year
Kong) Limited
Zhanjiang Port 16 April
200,000.00 - -- - - -
(Group) Co., Ltd. 2020
Total approved line for such Total actual amount of
guarantees in the Reporting 600,000 such guarantees in the 150,000
Period (B1) Reporting Period (B2)
Total actual balance of
Total approved line for such
such guarantees at the
guarantees at the end of the 600,000 150,000
end of the Reporting
Reporting Period (B3)
Period (B4)
Guarantees provided between subsidiaries
Disclosure
Guarante
date of the
Actual Actual Having e for a
guarantee Line of Type of Term of
Obligor occurrence guarantee expired related
line guarantee guarantee guarantee
date amount or not party or
announce
not
ment
China Merchants
International 16 April
59,010.00 - -- - - -
Terminal (Qingdao) 2020
Co., Ltd.
Shenzhen Jinyu
Rongtai Investment 12 January Joint- About 10
N/A 80,000.00 72,000.00 Not Not
Development Co., 2017 liability years
Ltd.
China Merchants
International Joint- About 10
N/A 2,500.00 30 June 2016 2,500.00 Not Not
(China) Investment liability years
Co., Ltd.
China Merchants
4 May General About 10
Finance Company 326,246.24 4 May 2012 326,246.24 Not Not
2012 guarantee years
Limited
China Merchants
3 August 3 August General About 10
Finance Company 326,246.24 326,246.24 Not Not
2015 2015 guarantee years
Limited
90
China Merchants Port Group Co., Ltd. Annual Report 2020
CMHI Finance 6 August 6 August General About 5
587,243.23 587,243.23 Not Not
(BVI) Co., Ltd 2018 2018 guarantee years
CMHI Finance 6 August 6 August General About 10
391,495.49 391,495.49 Not Not
(BVI) Co., Ltd 2018 2018 guarantee years
26 Septe General About 3
CMHI Finance 9 October 2 Not Not
mber 202 555,000.00 391,495.49 guarantee years
(BVI) Co., Ltd 020 General About 5
0 Not Not
130,498.50 guarantee years
COLOMBO
INTERNATIONAL
16 September General About 13
CONTAINER N/A 228,307.12 6,577.87 Not Not
2012 guarantee years
TERMINALS
LIMITED
COLOMBO
INTERNATIONAL
16 September General
CONTAINER N/A 9,787.39 9,787.39 Infinite Not Not
2012 guarantee
TERMINALS
LIMITED
COLOMBO
INTERNATIONAL
16 September General
CONTAINER N/A 16,312.31 16,312.31 Infinite Not Not
2012 guarantee
TERMINALS
LIMITED
Lome Container General About 9
N/A 8,024.99 June 2015 1,376.29 Not Not
Terminal Co., Ltd.
guarantee years
Lome Container General About 9
N/A 8,024.99 June 2015 1,376.29 Not Not
Terminal Co., Ltd. guarantee years
Lome Container General About 9
N/A 8,024.99 June 2015 1,376.29 Not Not
Terminal Co., Ltd. guarantee years
China Merchants
Port Development Joint- About 5
N/A 320,000.00 31 July 2017 58,000.00 Not Not
(Shenzhen) Co., liability years
Ltd.
TCP - TERMINAL
DE
General About 6
CONTElNERES N/A 37,653.00 19 April 2018 23,329.80 Not Not
guarantee years
DE PARANAGUA
S/A.
TCP - TERMINAL
DE
7 November General About 6
CONTElNERES N/A 53,724.18 53,724.18 Not Not
2016 guarantee years
DE PARANAGUA
S/A.
Shenzhen Haixing 30 March Joint- About 18
327,000.00 26 June 2019 16,150.08 Not Not
Harbor 2019 liability years
91
China Merchants Port Group Co., Ltd. Annual Report 2020
Development Co.,
Ltd.
Zhanjiang Port 16 April
80,000.00 - -- - - -
(Group) Co., Ltd. 2020
Hambantota 30 Dece
International Port mber 202 231,559.00 - -- - - -
Group (Pvt) Ltd. 0
CHINA
30
MERCHANTS
December 18,441.00 - -- - - -
HOLDINGS
2020
(DJIBOUTI) FZE
TCP - TERMINAL
DE 26 Septe
CONTElNERES mber 202 35,000.00 - -- - - -
DE PARANAGUA 0
S/A.
Kong Rise
16 April
Development 110,000.00 - -- - - -
2020
Limited
Total approved line for such Total actual amount of
guarantees in the Reporting 1,089,010.00 such guarantees in the 521,993.98
Period (C1) Reporting Period (C2)
Total actual balance of
Total approved line for such
such guarantees at the
guarantees at the end of the 3,819,600.17 2,415,735.67
end of the Reporting
Reporting Period (C3)
Period (C4)
Total guarantee amount (total of the three kinds of guarantees above)
Total guarantee line approved Total actual guarantee
in the Reporting Period 1,689,010.00 amount in the Reporting
671,993.98
(A1+B1+C1) Period (A2+B2+C2)
Total actual guarantee
Total approved guarantee line at
balance at the end of the
the end of the Reporting Period 4,445,492.35 2,584,148.65
Reporting Period
(A3+B3+C3)
(A4+B4+C4)
Total actual guarantee amount (A4+B4+C4) as % of the
69.62%
Company’s net assets
Of which:
Balance of guarantees provided for shareholders, actual
11,312.58
controller and their related parties (D)
Balance of debt guarantees provided directly or indirectly 2,452,091.74
92
China Merchants Port Group Co., Ltd. Annual Report 2020
for obligors with an over 70% debt/asset ratio (E)
Amount by which the total guarantee amount exceeds 50%
728,258.34
of the Company’s net assets (F)
Total of the three amounts above (D+E+F) 3,191,662.65
Joint responsibilities possibly borne in the Reporting Period
None
for undue guarantees (if any)
Provision of external guarantees in breach of the prescribed
None
procedures (if any)
Particulars of guarantees adopting complex methods
□ Applicable √ Not applicable
(2) Irregularities in Provision of Guarantees
□ Applicable √ Not applicable
No such cases in the Reporting Period.
3. Cash Entrusted to Other Entities for Management
(1) Cash Entrusted for Wealth Management
□ Applicable √ Not applicable
No such cases in the Reporting Period.
(2) Entrusted Loans
Overview of entrusted loans in the Reporting Period
Unit: RMB’0,000
Amount Capital resources Undue balance Overdue amount
3,430 Self-owned funds 3,430 0
Particulars of entrusted loans with single significant amount or low security, bad liquidity, and no
capital preservation
□ Applicable √ Not applicable
Whether there is the case where the principal cannot be recovered at maturity or other case which
may cause impairment for entrusted loans
□ Applicable √ Not applicable
4. Continuing Major Contracts
□ Applicable √ Not applicable
5. Other Major Contracts
□ Applicable √ Not applicable
93
China Merchants Port Group Co., Ltd. Annual Report 2020
No such cases in the Reporting Period.
XVIII. Corporate Social Responsibilities
1. Fulfillment of Social Responsibilities
Always upholding the principle of sustainable development and performing its social
responsibilities proactively, the Company promotes its sustainable development with efforts in
continuously strengthening environment governance, safeguarding the rights and interests of its
employees, attaching importance to occupational health, participating in charitable activities, and
responding to targeted poverty alleviation.
The Company is always committed to take on historical missions and has a strong sense of social
responsibilities. During our journey of growth and development, we never steer away from the
original goal. We take the lead to address social problems, continue to seek for the matching point
for mutual development with the society and explore appropriate models for conducting charitable
business that meets the needs of the current generation. By leveraging our core strengths to launch
professional charitable activities, support regional development and preserve fine cultures, we will
incorporate social development needs into our daily operation activities and join hands with even
more partners to create a harmonious society and promote social progress. Refer to Corporate
Social Responsibility Report of China Merchants Port Group Co., Ltd. in 2020 for the fulfillment of
social responsibilities in the Reporting Period for details.
2. Measures Taken for Targeted Poverty Alleviation
(1) Plan of Targeted Poverty Alleviation
In 2020, the Company exerted multiple efforts for poverty alleviation. First, it vigorously
implemented the national strategy of "eradicating poverty in China". Second, it adhered to the
general ideas and requirements of China Merchants Group (CMG) for poverty alleviation. Third, it
actively participated in education- and industry-based poverty alleviation and infrastructure
construction. Fourth, the Company earnestly tackled difficulties in poverty alleviation. Fifth, a long-
acting mechanism for poverty alleviation was formulated. Lastly, the annual plan for poverty
alleviation was implemented. Looking ahead, the Company will respond to the call of the central
government, continue driving rural revitalization, and consolidate the results of poverty alleviation.
94
China Merchants Port Group Co., Ltd. Annual Report 2020
Such combination of poverty alleviation results and rural revitalization will be effectively boost
rural revitalization.
(2) Overview of Annual Targeted Poverty Alleviation
During the epidemic in 2020, the Company spent RMB3.76 million on purchasing agricultural
products from poverty-stricken areas through the agriculture-promoting brand, "27° Nong",
including taros from Qichun County, Hubei, mineral water from Yecheng County, Xinjiang, and
Wuding and Yongde Counties, Yunnan. Meanwhile, the Company adopted several measures, such
as poverty alleviation based on industry, employment, education, health, and consumption as well
as helping and supporting projects, to push targeted poverty alleviation forward. It not only "gave
fish to the poor", but also "taught them how to fish". It assisted designated poverty-stricken villages
in getting rid of poverty.
(3) Results of Targeted Poverty Alleviation
Since the initiation of targeted poverty alleviation, the Company has enthusiastically responded to
the China Merchants Group by supporting four designated poverty-stricken counties, namely,
Weining County, Guizhou, Qichun County, Hubei, and Yecheng and Shache Counties, Xinjiang. (In
2020, the latter three counties were included in the list of counties requiring strict supervision and
united efforts in fighting poverty.) In the meantime, the Company actively guided its subordinate
enterprises to perform targeted poverty alleviation. For instance, Zhanjiang Port has helped "Mingli
Village" shake off poverty: All 121 people in 43 poverty-stricken households met the "Eight
Criteria" of Poverty Elimination (source of income, house, basic medical security, compulsory
education, roads, drinking water, electricity, and TV) for being lifted out of poverty. Annual per
capita income surged from less than RMB3,500 to over RMB13,000. The poverty elimination rate
was 100%.
The specific inputs and results of the Company regarding the poverty alleviation in 2020 are as
follows:
Unit of
Index Amount/implementation
measurement
I. Overall situation - -
Of which: 1. Fund RMB’0,000 506
2. Materials converted to cash RMB’0,000 -
II. Subitem investment - -
95
China Merchants Port Group Co., Ltd. Annual Report 2020
1. Industrial development poverty alleviation - -
Of which: 1.1 Type of plan of industrial Agriculture and forestry industrial poverty
-
development poverty alleviation alleviation
1.2 Number of plan of industrial
Unit 2
development poverty alleviation
1.3 Number of persons out of poverty
Person 121
which were helped to set up file card
2. Transfer employment poverty alleviation - -
2.1 Number of persons of vocational
Person -
training
3. Relocation poverty alleviation - -
4. Educational poverty alleviation - -
Of which: 4.1 Investment amount for poor
RMB’0,000 46
students supported
4.2 Number of poor students
Person 23
supported
5. Healthcare poverty alleviation - -
6. Ecological protection poverty alleviation - -
7. Basic living standard guarantee - -
Of which: 7.1 Investment amount for three kinds
RMB’0,000 -
of left-behind person
7.2 Assistant number of three kinds of
Person -
left-behind person
8. Social poverty alleviation - -
8.1 Investment amount of targeted
RMB’0,000 -
poverty alleviation
9. Other plans - -
Of which: 9.1 Investment amount RMB’0,000 460
Purchasing agricultural products, poverty
9.2 Notes alleviation of the poorest, infrastructure
construction, etc.
In 2020, the poverty alleviation task force
stationed in Mingli Village made up of
Zhanjiang Port and Zhanjiang Municipal
Development and Reform Bureau received
III. Awards received (content, level) - the commendation from Zhanjiang Leading
Group for Poverty Alleviation and
Development and was awarded the title of
“2019 Zhanjiang Municipal Advanced Unit
for Poverty Alleviation Work”.
3. Issues Related to Environmental Protection
Whether the Company or any of its subsidiaries is identified as a major polluter by the
environmental protection authorities?
No.
The Company strictly conformed to laws and regulations related to environmental protection,
revised and perfected management policies for environmental protection, organized training on
environmental protection, and assessed environmental risks. What's more, it intensified on-site
management and control, reinforced routine inspection over environmental protection, and
96
China Merchants Port Group Co., Ltd. Annual Report 2020
strengthened environmental protection assessment to further improve environmental protection
management.
The philosophy of green development is deeply rooted in the Company. The emission of all
pollutants is strictly controlled by law. Pollutant disposal is compliant. Energy-saving technologies,
such as the "smart transformation of the bucket-wheel stacker reclaimer", the "smart bulk cargo
continuous conveyor system", and "shore-based power supply to ships", have been developed and
applied to constantly enhance energy efficiency. Green and low-carbon ports are created to boost
global climate governance. Furthermore, biodiversity protection practices such as the monitoring,
investigation, and compensation of the marine ecology were carried out. The Company created
green ports of harmonious co-existence with nature. It also cooperated with multiple parties in the
green field to improve sustainable development. For the Company's efforts of environmental
protection during the Reporting Period, please see the Corporate Social Responsibility Report of
CMPort for 2020.
XIX Other Significant Events
Information Disclosure Index
In the Reporting Period, the Company disclosed the following significant events on Securities
Times, Shanghai Securities News, Ta Kung Pao (HK), and www.cninfo.com.cn:
97
China Merchants Port Group Co., Ltd. Annual Report 2020
Announce
Date Title
ment No.
Announcement on Approval of Stock Option Incentive Plan by State-
2020-001 3 January 2020 owned Assets Supervision and Administration Commission of the State
Council
Announcement on Resolutions of the 1st Special Meeting of the 9th Board
2020-002 10 January 2020
of Directors in 2020
Announcement on Resolutions of the 1st Special Meeting of the 9th
2020-003 10 January 2020
Supervisory Committee in 2020
Announcement on Notes and Revision of Stock Option Incentive Plan of
2020-004 10 January 2020 China Merchants Port Group Co., Ltd. (Phase I) (Revised Draft) and its
Abstract
2020-005 10 January 2020 Reminder of Convening the 1st Extraordinary General Meeting of 2020
Report of the Public Call for Proxy Voting Rights of Independent
2020-006 10 January 2020
Directors
Announcement on Voluntary Information Disclosure of Business Volume
2020-007 16 January 2020
Data of December 2019
2020-008 20 January 2020 Announcement on an Estimated Growth in 2019 Annual Results
Announcement on Notes of the Supervisory Committee on the Review
2020-009 20 January 2020 and Publicity of the List of Incentive Objects under the Stock Option
Incentive Plan (Phase I)
Announcement on the Change of the Company’s Registered Information
2020-010 22 January 2020
with the Industrial and Commercial Administration
Announcement on Resolutions of the 1st Extraordinary General Meeting
2020-011 4 February 2020
of 2020
Announcement on Resolutions of the 2nd Special Meeting of the 9th
2020-012 4 February 2020
Board of Directors in 2020
Announcement on Resolutions of the 2nd Special Meeting of the 9th
2020-013 4 February 2020
Supervisory Committee in 2020
Announcement on the Grant of Stock Option (the First Grant) to
2020-014 4 February 2020
Incentive Objects of the Stock Option Incentive Plan of the Company
Self-inspection Report on the Trading of the Company’s Shares by
2020-015 4 February 2020 Insiders and Incentive Objects of the Stock Option Incentive Plan (Phase
I)
Announcement on Resignation of Chairman of the Board and
2020-016 4 February 2020
Election of New Chairman of the Board
Announcement on Voluntary Information Disclosure of Business Volume
2020-017 14 February 2020
Data of January 2020
Reminder of the Issuance of 2020 Phase I Super-short-term Financing
2020-018 21 February 2020
Bonds
Announcement on Issued Result of 2020 Phase I Super-short-term
2020-019 27 February 2020
Financing Bonds
2020-020 14 March 2020 Announcement on Completion of the Grant of Stock Option (the First
98
China Merchants Port Group Co., Ltd. Annual Report 2020
Grant) under the Stock Option Incentive Plan (Phase I) of the Company
Announcement on Voluntary Information Disclosure of Business Volume
2020-021 14 March 2020
Data of February 2020
2020-022 30 March 2020 2019 Annual Results Preview
Announcement on the Disclosure of the 2019 Annual Results by the
2020-023 30 March 2020
Majority-Owned Subsidiary (Unaudited)
Announcement on Resolutions of the 3rd Special Meeting of the 9th Board
2020-024 7 April 2020
of Directors in 2020
Announcement on Establishment Joint Ventures by Joint Investment
2020-025 7 April 2020
with Related Party and Related-party Transactions
Announcement on Retirement and Application of Resignation of
2020-026 8 April 2020
Employee Supervisor
2020-027 11 April 2020 2020 First Quarter Performance Forecast
Announcement on Resolutions of the 7th Meeting of the 9th Board of
2020-028 16 April 2020
Directors
Announcement on Resolutions of the 7th Special Meeting of the 9th
2020-029 16 April 2020
Supervisory Committee
Abstract of 2019 Annual Report (Chinese Version)
2020-030 16 April 2020
Abstract of 2019 Annual Report (English Version)
Announcement on the Confirmation of the Continuing Related-Party
2020-031 16 April 2020
Transactions in 2019 and the Estimation of Such Transactions in 2020
Announcement on the Related-Party Transaction Regarding Making
2020-032 16 April 2020
Deposits in and Obtaining Loans from China Merchants Bank in 2020
Announcement on the External Guarantee Progress of a Majority-Owned
2020-033 16 April 2020 Subsidiary of the Company in 2019 and the Expected New External
Guarantee Line in the Next 12 Months
2020-034 16 April 2020 Announcement on 2019 Profit Distribution Plan
2020-035 16 April 2020 Special Report on Deposit and Usage of Raised Fund in 2019
2020-036 16 April 2020 Announcement on Reappointment of Accounting Firm in 2020
Announcement on Changes in Accounting Estimates of Depreciation
2020-037 16 April 2020
Period of Partial Fixed Assets
Announcement on Providing Financial Aid by Majority-owned
2020-038 16 April 2020
Subsidiaries
Announcement on the Disclosure of the 2019 Annual Results by a
2020-039 16 April 2020
Majority-Owned Subsidiary
Announcement on the Online Investor Communication on the 2019
2020-040 16 April 2020
Annual Results to Be Held
Announcement on Voluntary Information Disclosure of Business Volume
2020-041 16 April 2020
Data of March 2020
Reminder of the Issuance of 2020 Phase II Super-short-term Financing
2020-042 24 April 2020
Bonds
2020-043 30 April 2020 Announcement on the Resolutions of the 4th Extraordinary Meeting of
99
China Merchants Port Group Co., Ltd. Annual Report 2020
the 9th Board of Directors of 2020
The Text of the First Quarter Report 2020 (Chinese Version)
2020-044 30 April 2020
The Text of the First Quarter Report 2020 (English Version)
Announcement on Providing Financial Aid for Subsidiaries and Related-
2020-045 30 April 2020
party Transactions
2020-046 30 April 2020 Reminder of Convening the 2019 Annual General Meeting
2020-047 30 April 2020 Announcement on Resignation of Chief Financial Officer
Announcement on Issue Results of 2020 Phase II Super-short-term
2020-048 6 May 2020
Financing Bonds
Announcement on Voluntary Information Disclosure of Business Volume
2020-049 16 May 2020
Data of April 2020
2020-050 23 May 2020 Announcement on Resolutions of the 2019 Annual General Meeting
Announcement on Resolutions of the 1st Meeting of the 10th Board of
2020-051 23 May 2020
Directors
Announcement on Resolutions of the 1st Meeting of the 10th Supervisory
2020-052 23 May 2020
Committee
Announcement on Completion of General Election of the Board of
2020-053 23 May 2020 Directors and Supervisory Committee and Appointment of Senior
Executives and Securities Affairs Representatives
Reminder of the Issuance of 2020 Phase III Super-short-term Financing
2020-054 2 June 2020
Bonds
Announcement on Issue Results of 2020 Phase III Super-short-term
2020-055 8 June 2020
Financing Bonds
Announcement on Voluntary Information Disclosure of Business Volume
2020-056 12 June 2020
Data of May 2020
2020-057 9 July 2020 Announcement on 2019 Dividends Distribution Implementation
2020-058 11 July 2020 Announcement on an Estimated Growth in the H1 2020 Results
Announcement on Voluntary Information Disclosure of Business
2020-059 11 July 2020
Volume Data of June 2020
2020-060 28 July 2020 Reminder of the Issuance of Support Letter to Antong Holdings Co., Ltd.
Announcement on Voluntary Information Disclosure of Business
2020-061 15 August 2020
Volume Data of July 2020
2020-062 15 August 2020 Announcement on New Media for Information Disclosure
Announcement on Resolutions of the 2nd Meeting of the 10th Board of
2020-063 29 August 2020
Directors
Announcement on Resolutions of the 2nd Meeting of the 10th Supervisory
2020-064 29 August 2020
Committee
Abstract of Interim Report 2020
2020-065 29 August 2020
Abstract of Interim Report 2019 (English Version)
2020-066 29 August 2020 Special Report on Deposit and Usage of Raised Fund in H1 2020
Announcement on the Disclosure of the 2020 Interim Results by a
2020-067 29 August 2020
Majority-Owned Subsidiary
100
China Merchants Port Group Co., Ltd. Annual Report 2020
Announcement on the Online Investor Communication on the 2020
2020-068 29 August 2020
Interim Results
Announcement on Voluntary Information Disclosure of Business
2020-069 15 September 2020
Volume Data of August 2020
2020-070 26 September 2020 Announcement on Adjusting the Guarantee Line among Subsidiaries
Announcement on the Issuance of Overseas Dollar Bonds by the Wholly-
2020-071 10 October 2020
owned Subsidiary of the Majority-owned Subsidiary
Announcement on Voluntary Information Disclosure of Business
2020-072 15 October 2020
Volume Data of September 2020
Announcement on the Additional Issuance of Overseas Dollar Bonds by
2020-073 22 October 2020
the Wholly-owned Subsidiary of the Majority-owned Subsidiary
Announcement on Resolutions of the 1st Special Meeting of the 10th
2020-074 31 October 2020
Board of Directors in 2020
The Text of the Third Quarter Report 2020
2020-075 31 October 2020
The Text of the Third Quarter Report 2020 (English Version)
Reminder of Asset Acquisition and Supporting Fund Raising by Share
2020-076 2 November 2020 Issuance and the Related-party Transaction Regarding the Issuance of
Restricted Shares for Raising Supporting Funds
Announcement on Voluntary Information Disclosure of the Joint Stock
2020-077 5 November 2020 Company Formally Being the Reorganization Investor of Antong
Holdings Co., Ltd.
Reminder of Issuance 2020 Phase IV Super & Short-term Commercial
2020-078 12 November 2020
Paper
Announcement on Issue Results of 2020 Phase IV Super & Short-term
2020-079 14 November 2020
Commercial Paper
Announcement on Voluntary Information Disclosure of Business
2020-080 14 November 2020
Volume Data of October 2020
Announcement on the Due Payment of 2020 Phase I Super & Short-term
2020-081 19 November 2020
Commercial Paper (Epidemic Prevention and Control Bond)
Announcement on Resolutions of the 2nd Special Meeting of the 10th
2020-082 1 December 2020
Board of Directors in 2020
Announcement on Resolutions of the 2nd Special Meeting of the 10th
2020-083 1 December 2020
Supervisory Committee in 2020
2020-084 1 December 2020 Announcement on Cash Management with Idle Raised Funds
Announcement on Establishing an Investment Fund and Related-party
2020-085 1 December 2020
Transaction Jointly with Related Parties through Investments
Announcement on Participation of 2020 Online Collective Reception
2020-086 4 December 2020 Activity for investors of Shenzhen Honest and Trustworthy and
Respectable Listed Companies
Announcement on Voluntary Information Disclosure of Business
2020-087 16 December 2020
Volume Data of November 2020
Announcement on Resolutions of the 3rd Special Meeting of the 10th
2020-088 19 December 2020
Board of Directors in 2020
101
China Merchants Port Group Co., Ltd. Annual Report 2020
Announcement on Capital Increase in the Subsidiary and Related-party
2020-089 19 December 2020
Transaction by Related Parties
Announcement on Resolutions of the 4th Special Meeting of the 10th
2020-090 30 December 2020
Board of Directors in 2020
Announcement on Establishing a Joint Venture and Related-party
2020-091 30 December 2020 Transaction by Majority-owned Subsidiary Jointly with Related Parties
through Investments
2020-092 30 December 2020 Announcement on Adjusting the Guarantee Line among Subsidiaries
XX Significant Events of Subsidiaries
On 25 November 2019, CMPort Holdings signed a memorandum of agreement with CMA,
according to which, CMA intended to transfer the equity assets of 10 ports it held to Terminal Link
(TL). To complete the transfer, CMPort Holdings would provide TL with a financing of no more
than US$968 million, including guaranteed long-term loans of no more than US$500 million with a
term of eight years and mandatory convertible securities of no more than US$468 million for the
subscription of TL. At the maturity of the long-term loans, CMA would provide the cash required
for repaying the loans by injecting capital in TL and all the convertible securities held by CMPort
Holdings would be converted into TL’s equity mandatorily. On 26 March 2020, CMPort Holdings
completed the acquisition of Phase I eight target ports, with the subscription of mandatory
convertible securities and prepayment of the loans amounting to approximately US$815 million.
102
China Merchants Port Group Co., Ltd. Annual Report 2020
Part VI Share Changes and Shareholder Information
I. Share Changes
1. Share Changes
Unit: share
Before Increase/decrease in the Reporting Period (+/-) After
Shares
Shares
as
as
dividen
dividend
Percenta New d Percentag
Shares converte Other Subtotal Shares
ge (%) issues convert e (%)
d from
ed
capital
from
reserves
profit
I. Restricted shares1,277,770,996 66.47% 0 0 0 -129,112,852 -129,112,852 1,148,658,144 59.75%
1. Shares held by
0 0.00% 0 0 0 0 0 0 0.00%
state
2. Shares held by
state-owned legal 128,952,746 6.71% 0 0 0 -128,952,746 -128,952,746 0 0.00%
person
3. Shares held by
other domestic 169,602 0.01% 0 0 0 -160,106 -160,106 9,496 0.00%
investors
Including: Shares
held by domestic 0 0.00% 0 0 0 0 0 0 0.00%
legal person
Shares
held by domestic 169,602 0.01% 0 0 0 -160,106 -160,106 9,496 0.00%
natural person
4. Shares held by
1,148,648,648 59.75% 0 0 0 0 0 1,148,648,648 59.75%
foreign investors
Including: Shares
held by foreign 1,148,648,648 59.75% 0 0 0 0 0 1,148,648,648 59.75%
legal person
Shares
held by foreign 0 0.00% 0 0 0 0 0 0 0.00%
natural person
II. Unrestricted
644,594,128 33.53% 0 0 0 129,112,852 129,112,852 773,706,980 40.25%
shares
1. RMB ordinary
464,858,324 24.18% 0 0 0 128,961,746 128,961,746 593,820,070 30.89%
shares
2. Domestically
179,735,804 9.35% 0 0 0 151,106 151,106 179,886,910 9.36%
listed foreign shares
3. Overseas listed
0 0.00% 0 0 0 0 0 0 0.00%
foreign shares
4. Other 0 0.00% 0 0 0 0 0 0 0.00%
III. Total shares 1,922,365,124 100.00% 0 0 0 0 0 1,922,365,124 100.00%
Reasons for share changes:
(1) Change of directors, supervisors and senior management; (2) Restrictions on shares held by the
Company’s shareholders Shenzhen Infrastructure Investment Fund Partnership (Limited Partnership)
and China-Africa Development Fund are released.
Approval of share changes:
103
China Merchants Port Group Co., Ltd. Annual Report 2020
□ Applicable √ Not applicable
Transfer of share ownership:
□ Applicable √ Not applicable
Progress on any share repurchases:
□ Applicable √ Not applicable
Progress on reducing the repurchased shares by means of centralized bidding:
□ Applicable √ Not applicable
Effects of share changes on the basic and diluted earnings per share, equity per share attributable to
the Company’s ordinary shareholders and other financial indicators of the prior year and the prior
accounting period, respectively:
□ Applicable √ Not applicable
Other information that the Company considers necessary or is required by the securities regulator to
be disclosed:
□ Applicable √ Not applicable
2. Changes in Restricted Shares
Unit: share
Number
Number of Number of Number of
of Date of
Name of restricted released restricted
increased Reason for restriction restriction
shareholders shares at the restricted shares at the
restricted release
period-begin shares period-end
shares
China
Merchants
According to relevant
Port
laws and regulations and
Investment 1,148,648,648 0 0 1,148,648,648 June 2022
the shareholder
Development
commitment
Company
Limited
SHENZHEN
INFRASTR
UCTURE
INVESTME
NT FUND-
SHENZHEN
According to relevant
INFRASTR
laws and regulations and November
UCTURE 64,850,182 0 64,850,182 0
the shareholder 2020
INVESTME
commitment
NT FUND
PARTNERS
HIP
(LIMITED
PARTNERS
HIP)
CHINA- 64,102,564 0 64,102,564 0 According to relevant November
104
China Merchants Port Group Co., Ltd. Annual Report 2020
AFRICA laws and regulations and 2020
DEVELOPM the shareholder
ENT FUND commitment
According to the Articles
of Association and the December
Yuan Yuhui 10,530 3,510 14,040 0
relevant laws and 2020
regulations
According to the Articles
of Association and the December
Ni Keqin 21,909 7,302 29,211 0
relevant laws and 2020
regulations
According to the Articles
Zheng of Association and the
9,496 0 0 9,496 -
Shaoping relevant laws and
regulations
According to the Articles
Zhang of Association and the December
55,712 0 55,712 0
Jianguo relevant laws and 2020
regulations
According to the Articles
Zhao of Association and the December
48,716 0 48,716 0
Chaoxiong relevant laws and 2020
regulations
According to the Articles
of Association and the December
Wang Yongli 3,739 0 3,739 0
relevant laws and 2020
regulations
According to the Articles
Yao of Association and the December
19,500 0 19,500 0
Shenglan relevant laws and 2020
regulations
Total 1,277,770,996 10,812 129,123,664 1,148,658,144 -- --
Note: China Merchants Investment Development Company Limited (CMID) (Chinese name: 招 商 局 投 资 发 展 有 限 公 司 ) was
renamed China Merchants Port Investment Development Company Limited (CMPID) (Chinese name: 招商局港口投资发展有限公
司) on 8 July 2020.
II. Issuance and Listing of Securities
1. Securities (Exclusive of Preferred Shares) Issued in the Reporting Period
□ Applicable √ Not applicable
2. Changes to Total Shares, Shareholder Structure and Asset and Liability Structures
□ Applicable √ Not applicable
3. Existing Staff-Held Shares
□ Applicable √ Not applicable
III Shareholders and Actual Controller
1. Shareholders and Their Shareholdings at the Period-End
105
China Merchants Port Group Co., Ltd. Annual Report 2020
Unit: share
Number of
preferred
Number of
shareholders
ordinary
Number of Number of preferred with resumed
shareholders at
ordinary shareholders with voting rights at
shareholders at
32,872 the month-end 32,743 resumed voting rights at 0
the month-end
0
prior to the
the period-end the period-end (if any) prior to the
disclosure of this
disclosure of
Report
this Report (if
any)
5% or greater shareholders or top 10 shareholders
Increase/dec
Shareholdi Total shares
Name of Nature of rease in the Restricted Unrestricted Shares in pledge or
ng held at the
shareholder shareholder Reporting shares held shares held frozen
percentage period-end
Period
CHINA
MERCHANTS
PORT
Foreign legal
INVESTMENT 59.75% 1,148,648,648 0 1,148,648,648 0 0
person
DEVELOPMENT
COMPANY
LIMITED
CHINA
MERCHANTS
GANGTONG State-owned
19.29% 370,878,000 0 0 370,878,000 0
DEVELOPMENT legal person
(SHENZHEN)
CO., LTD.
SHENZHEN
INFRASTRUCTU
RE
INVESTMENT
FUND-
Fund and
SHENZHEN
wealth
INFRASTRUCTU 3.37% 64,850,182 0 0 64,850,182 0
management
RE
products
INVESTMENT
FUND
PARTNERSHIP
(LIMITED
PARTNERSHIP)
CHINA-AFRICA
State-owned
DEVELOPMENT 3.33% 64,102,564 0 0 64,102,564 0
legal person
FUND
BROADFORD
State-owned
GLOBAL 2.88% 55,314,208 0 0 55,314,208 0
legal person
LIMITED
CMBLSA RE
FTIF
Foreign legal
TEMPLETON 0.54% 10,410,926 -19,565,670 0 10,410,926 Unknown
ASIAN GRW FD person
GTI 5496
Foreign legal
NORGES BANK 0.15% 2,802,863 0 0 2,802,863 Unknown
person
HONG KONG
SECURITIES Foreign legal
CLEARING 0.14% 2,707,901 1,522,020 0 2,707,901 Unknown
COMPANY LTD. person
CHINA
MERCHANTS State-owned
SECURITIES 0.14% 2,606,355 93,000 0 2,606,355 Unknown
(HK) CO., LTD. legal person
106
China Merchants Port Group Co., Ltd. Annual Report 2020
Domestic
MAI SHUQING 0.11% 2,129,247 -247,500 0 2,129,247 Unknown
natural person
Strategic investors or general legal
person becoming top-ten
N/A
shareholders due to placing of new
shares (if any)
China Merchants Gangtong Development (Shenzhen) Co., Ltd. is a majority-owned subsidiary
Related or acting-in-concert parties of Broadford Global Limited, and Broadford Global Limited is the controlling shareholder of
among the shareholders above China Merchants Port Investment Development Company Limited. The Company does not
know whether the other unrestricted shareholders are related parties or not.
Above shareholders involved in
entrusting/being entrusted and None
giving up voting rights
Top 10 unrestricted shareholders
Shares by type
Name of shareholder Unrestricted shares held at the period-end
Type Shares
CHINA MERCHANTS RMB
GANGTONG DEVELOPMENT 370,878,000 ordinary 370,878,000
(SHENZHEN) CO., LTD. share
SHENZHEN INFRASTRUCTURE
INVESTMENT FUND-
RMB
SHENZHEN INFRASTRUCTURE
64,850,182 ordinary 64,850,182
INVESTMENT FUND
share
PARTNERSHIP (LIMITED
PARTNERSHIP)
RMB
CHINA-AFRICA
64,102,564 ordinary 64,102,564
DEVELOPMENT FUND
share
Domesti
cally
BROADFORD GLOBAL
55,314,208 listed 55,314,208
LIMITED
foreign
share
Domesti
cally
CMBLSA RE FTIF TEMPLETON
10,410,926 listed 10,410,926
ASIAN GRW FD GTI 5496
foreign
share
Domesti
cally
NORGES BANK 2,802,863 listed 2,802,863
foreign
share
RMB
HONG KONG SECURITIES
2,707,901 ordinary 2,707,901
CLEARING COMPANY LTD.
share
Domesti
cally
CHINA MERCHANTS
2,606,355 listed 2,606,355
SECURITIES (HK) CO., LTD.
foreign
share
RMB
MAI SHUQING 2,129,247 ordinary 2,129,247
share
SHEN ZHEN QIAN HAI HUA RMB
2,005,091 2,005,091
SHAN CAPITAL CO.,Ltd-HUA ordinary
107
China Merchants Port Group Co., Ltd. Annual Report 2020
SHAN YONG XU PRIVATE share
EQUITY MANAGEMENT
Related or acting-in-concert parties
among top 10 unrestricted public
China Merchants Gangtong Development (Shenzhen) Co., Ltd. is a majority-owned subsidiary
shareholders, as well as between
of Broadford Global Limited. The Company does not know whether the other unrestricted
top 10 unrestricted public
shareholders are related parties or not.
shareholders and top 10
shareholders
Top 10 ordinary shareholders
involved in securities margin N/A
trading (if any)
Indicate by tick mark whether any of the top 10 ordinary shareholders or the top 10 unrestricted
ordinary shareholders of the Company conducted any promissory repo during the Reporting Period.
□ Yes √ No
No such cases in the Reporting Period.
2. Controlling Shareholder
Nature of the controlling shareholder: Controlled by a central state-owned legal person
Type of the controlling shareholder: legal person
Legal
Name of controlling representative
Date of establishment Unified social credit code Principal activity
shareholder /person in
charge
Port services,
bonded logistic
and cold chain
BROADFORD GLOBAL Li Jianhui,
27 November 2017 68550019-000-11-17-2 services,
LIMITED Sun Ligan
property
development and
investment
Shareholdings of the
controlling shareholder in
other listed companies at N/A
home or abroad in this
Reporting Period
Change of the controlling shareholder in the Reporting Period:
□ Applicable √ Not applicable
No such cases in the Reporting Period.
3. Actual Controller and Its Acting-in-Concert Parties
Nature of the actual controller: Central institution for state-owned assets management
Type of the actual controller: legal person
Name of Legal
Unified
actual representat Date of
social credit Principal activity
controlle ive/person establishment
code
r in charge
Lease and agency of water/land passenger-cargo
China transportation, water/land conveyance and facilities;
Miao
Merchan 14 October 1986 10000522-0 investment and management of port and storage
Jianmin
ts Group business; salvage, refloatation and tugboat; industrial
production; construction, repairing, checking and
108
China Merchants Port Group Co., Ltd. Annual Report 2020
marketing of shipping, offshore petroleum drilling
equipment; repairing and checking of drilling platform
and drilling container; overall contracting of
water/land construction projects and the related
offshore petroleum development projects, and their
construction organization and logistic services;
procurement, supply and sale of water/land
communication and transportation equipment; export
and import business of transportation; investment and
management of finance, insurance, trust, securities,
futures business; investment and management of
tourism, hotels, catering services and relevant service;
real estate development, management and consultancy
of property; investment and management of petroleum
and chemical industry; investment and operation of
infrastructure of communication; overseas assets
management. Development and management of
Shenzhen Shekou Industrial Zone and Fujian
Zhangzhou Development Zone. (The market body
shall independently choose business items and carry
out business activities according to law. For items
requiring approval according to law, the market body
must obtain approval from related authorities before
carrying out the business activities. The market body
shall not engage in business activities that are banned
and restricted in the national and municipal industrial
policies.)
China Merchants Group holds:
78.29% shares of Yingkou Port Services Co., Ltd.;
75.00% shares of Dalian Port (PDA) Company Limited;
74.35% China Merchants Land Limited;
68.72% shares of China Merchants Expressway Network &Technology Holdings Co., Ltd;
64.94% shares of China Merchants Port Holdings Company Limited;
63.98% shares of China Merchants Shekou Industrial Zone Holdings Co., Ltd.;
57.64% shares of Sinotrans Limited;
Sharehol
54.39% shares of China Merchants Energy Shipping Co., Ltd;
dings of
51.16% shares of China Merchants Property Operation & Service Co., Ltd.;
the
44.17% shares of China Merchants Securities Co. Ltd.;
actual
33.50% shares of China Merchants Commercial Real Estate Investment Trust;
controlle
29.97% shares of China Merchants Bank Co., Ltd;
r in
29.94% shares of Anhui Expressway Company Limited;
other
27.59% shares of China Merchants China Direct Investments Limited;
listed
27.47% shares of Nanjing Tanker Corporation;
compani
26.55% shares of Shanghai International Port (Group) Co., Ltd;
es at
24.88% shares of Sichuan Expressway Company Limited;
home or
24.60% shares of China International Marine Containers (Group) Ltd;
abroad
19.08% shares of Jinzhou Port Co., Ltd.;
in this
17.75% shares of Fujian Expressway Development Co., Ltd;
Reportin
16.52% shares of Heilongjiang Transport Development Co., Ltd;
g Period
16.32% shares of Hubei Chutian Smart Communication Co., Ltd.;
16.29% shares of Shandong Hi-speed Co., Ltd;
15.43% shares of Henan Zhongyuan Expressway Co., Ltd;
14.04% shares of Jilin Expressway Co., Ltd;
13.86% shares of Guangxi Wuzhou Communications Co., Ltd;
12.36% shares of China Great Wall Securities Co., Ltd.;
11.69% shares of Jiangsu Expressway Company Limited;
8.04% shares of Xiandai Investment Co., Ltd;
109
China Merchants Port Group Co., Ltd. Annual Report 2020
6.68% shares of Shenzhen Expressway Co., Ltd;
6.03% shares of S.F. Holding Co., Ltd.;
5.00% shares of Ningbo Zhoushan Port Company Limited;
2.36% shares of Qingdao Port International Co., Ltd;
1.20% shares of Oriental Times Media Co., Ltd;
1.02% shares of Sinotrans & CSC Phoenix Co., Ltd.;
0.53% shares of China Shipbuilding Industry Company Limited;
0.38% shares of Sino-Ocean Group Holding Limited;
0.16% shares of CMMB Vision Holdings Limited;
0.14% shares of Sinopec Engineering (Group) Co., Ltd.;
0.07% shares of Haitong Securities Co., Ltd.;
0.05% shares of China Energy Engineering Corporation Limited;
0.02% shares of Bank of Tianjin Co., Ltd.;
0.01% shares of Shenwan Hongyuan Group Co., Ltd.
Change of the actual controller during the Reporting Period:
□ Applicable √ Not applicable
No such cases in the Reporting Period.
Ownership and control relations between the actual controller and the Company:
Indicate by tick mark whether the actual controller controls the Company via trust or other ways of
asset management.
□ Applicable √ Not applicable
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China Merchants Port Group Co., Ltd. Annual Report 2020
4. Other 10% or Greater Corporate Shareholders
Legal
Name of
representat
corporate Date of establishment Registered capital Business scope or management activities
ive/person
shareholders
in charge
China
Merchants
Port
Li Jianhui, HKD28,287,989,2 Investment management of equities and
Investment 15 November 2013
Sun Ligan 41 others
Development
Company
Limited
Provision of management services for
ports (without involving special
administrative measures on the access of
foreign investment); port information
inquiries, economic information
consultation, economic information
consultation, corporate management
consultation, business information
consultation, brand management
consultation and logistics information
consultation (excluding restricted items in
each case); technical development and
sales of ship machinery and equipment;
technical services in respect of port
loading and unloading equipment;
supporting businesses in respect of the
design, sales, import and export of loading
China and unloading tools, mechanical and
Merchants electrical products and non-ferrous metal
Gangtong Deng products (excluding precious metals)
16 January 2018 RMB9.446 million
Development Weidong (Commodities that involve state trading,
(Shenzhen) quota, license and special administrative
Co., Ltd. regulations shall be operated through the
application pursuant to related state
regulations); technical development and
technical services in respect of modern
logistics information systems; supply
chain management and related supporting
services; design of logistics plans;
planning of corporate image; planning of
cultural exchange activities (without
involving special administrative measures
on the access of foreign investment);
marketing planning; and planning of
brand image. (In each case, any item
forbidden by laws, administrative
regulations and the State Council shall be
excluded and restricted items shall be
operated upon the attainment of the
permission)
5. Limitations on Shareholding Decrease by the Company’s Controlling Shareholder, Actual
Controller, Reorganizer and Other Commitment Makers
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China Merchants Port Group Co., Ltd. Annual Report 2020
For details, see III. Fulfillment of commitments in Part V Significant Events of this report
112
China Merchants Port Group Co., Ltd. Annual Report 2020
Part VII Preferred Shares
□ Applicable √ Not applicable
No preferred shares in the Reporting Period.
113
China Merchants Port Group Co., Ltd. Annual Report 2020
Part VIII Convertible Corporate Bonds
□ Applicable √ Not applicable
No convertible corporate bonds in the Reporting Period.
114
China Merchants Port Group Co., Ltd. Annual Report 2020
Part IX Directors, Supervisors, Senior Management and Staff
I Change in Shareholdings of Directors, Supervisors and Senior Management
Decrea
Increas
Beginn se in Other Endin
Incu e in the
ing the increas g
mben Gen Reporti
Name Office title Age Start of tenure End of tenure shareh Reporti e/decre shareh
t/For der ng
olding ng ase olding
mer Period
(share) Period (share) (share)
(share)
(share)
Incu
Deng Chairman of Mal
mben 51 December 2018 May 2023 0 0 0 0 0
Renjie the Board e
t
Vice Chairman Incu
Bai Mal September
of the Board mben 55 May 2023 0 0 0 0 0
Jingtao e 2017
and CEO t
Incu
Yan Mal
Director mben 48 December 2018 May 2023 0 0 0 0 0
Shuai e
t
Incu
Song Mal
Director mben 58 December 2018 May 2023 0 0 0 0 0
Dexing e
t
Incu
Zhang Director, COO Mal
mben 50 December 2018 May 2023 0 0 0 0 0
Yi and GM e
t
Incu
Gao Independent Mal
mben 65 May 2020 May 2023 0 0 0 0 0
Ping director e
t
Wang Incu
Independent Mal
Zhenm mben 54 May 2020 May 2023 0 0 0 0 0
director e
in t
Incu Fe
Independent
Li Qi mben mal 50 May 2020 May 2023 0 0 0 0 0
director
t e
Chairman of
Incu
Liu the Mal
mben 49 December 2018 May 2023 0 0 0 0 0
Yingjie Supervisory e
t
Committee
Incu Fe
Hu Qin Supervisor mben mal 54 December 2018 May 2023 0 0 0 0 0
t
e
Incu
Yang Mal
Supervisor mben 54 December 2018 May 2023 0 0 0 0 0
Yuntao e
t
Incu Fe
Gong
Supervisor mben mal 32 May 2020 May 2023 0 0 0 0 0
Man
t e
Incu
Mal
Xu Jia Supervisor mben 39 May 2020 May 2023 0 0 0 0 0
e
t
115
China Merchants Port Group Co., Ltd. Annual Report 2020
Zheng Incu
Mal
Shaopi Vice GM mben 58 December 2018 May 2023 12,661 0 2,840 0 9,821
e
ng t
Lu Incu
Vice GM and Mal
Yongxi mben 51 December 2018 May 2023 0 0 0 0 0
Acting CFO e
n t
Vice GM and
Incu
Li Acting Mal
mben 49 December 2018 May 2023 0 0 0 0 0
Yubin Secretary of e
t
the Board
Incu
Xu Mal
Vice GM mben 49 October 2020 May 2023 0 0 0 0 0
Song e
t
Incu
Liu General Mal
mben 47 August 2020 May 2023 0 0 0 0 0
Libing Counsel e
t
Fu Former
Form Mal
Gangfe Chairman of 54 December 2018 January 2020 0 0 0 0 0
er e
ng the Board
Former Form Mal
Su Jian 49 December 2018 March 2021 0 0 0 0 0
Director er e
Former
Yuan Form Mal
Independent 70 June 2017 May 2020 14,040 0 0 0 14,040
Yuhui er e
director
Former
Su Form Mal
Independent 57 June 2017 May 2020 0 0 0 0 0
Qiyun er e
director
Li Former
Form Mal
Chang Independent 52 June 2017 May 2020 0 0 0 0 0
er e
qing director
Fe
Ni Former Form
mal 56 June 2017 May 2020 29,211 0 0 0 29,211
Keqin Supervisor er
e
Zheng Former Form Mal
50 June 2017 May 2020 0 0 0 0 0
Linwei Supervisor er e
Former Vice
Huang GM and
Form Mal
Chuanj Former 38 December 2018 January 2021 0 0 0 0 0
er e
ing Secretary of
the Board
Fe
Wen Form
Former CFO mal 55 December 2018 April 2020 0 0 0 0 0
Ling er
e
Total -- -- -- -- -- -- 55,912 0 2,840 53,072
II Change of Directors, Supervisors and Senior Management
Type of
Name Office title Date of change Reason for change
change
Chairman of
Deng Renjie Elected 3 February 2020 -
the Board
Vice Chairman
Bai Jingtao Elected 14 April 2020 -
of the Board
Zhang Yi Director Elected 22 May 2020 -
Independent
Gao Ping Elected 22 May 2020 -
director
116
China Merchants Port Group Co., Ltd. Annual Report 2020
Wang Independent
Elected 22 May 2020 -
Zhenmin director
Independent
Li Qi Elected 22 May 2020 -
director
Gong Man Supervisor Elected 22 May 2020 -
Xu Jia Supervisor Elected 22 May 2020 -
General
Liu Libing Elected 27 August 2020 -
Counsel
Xu Song Vice GM Elected 29 October 2020 -
Chairman of
Fu Gangfeng Left 31 January 2020 Job change
the Board
Wen Ling CFO Left 29 April 2020 Retirement
Left for
Independent
Yuan Yuhui expiration of 22 May 2020 Change of the Board
director
appointment
Left for
Independent
Su Qiyun expiration of 22 May 2020 Change of the Board
director
appointment
Left for
Independent
Li Changqing expiration of 22 May 2020 Change of the Board
director
appointment
Left for
Change of the Supervisory
Ni Keqin Supervisor expiration of 22 May 2020
Committee
appointment
Left for
Change of the Supervisory
Zheng Linwei Supervisor expiration of 22 May 2020
Committee
appointment
Vice GM and
Huang
Secretary of Left 15 January 2021 Job change
Chuanjing
the Board
Su Jian Director Left 5 March 2021 Job change
III Biographical Information
Professional backgrounds, major work experience and current duties in the Company of the
incumbent directors, supervisors and senior management:
Deng Renjie, Chairman of the Board, graduated from Beijing Electronic Science&Technology
Institute, majoring in computing, and obtained a bachelor degree, later graduated from Dalian
Maritime University, majoring in international economic law, and obtained master’s degree. Deng
Renjie now holds the post of the Vice GM of China Merchants Group Company Limited, President
of Liaoning Port Group Co., Ltd., the Company’s Chairman of the Board, Vice President of the 8th
Council of China Highway and Transportation Society & Vice President of the 7th Council of China
Transportation Association. Deng Renjie has successively held the posts of Researcher of General
Office of Ministry of Communications, Deputy Director of General Office of Hunan Provincial
Party Committee, Deputy Secretary General of Hunan Provincial Party Committee, Deputy
117
China Merchants Port Group Co., Ltd. Annual Report 2020
Secretary General of Party Committee of Xinjiang Autonomous Region, Assistant President of
China Merchants Group Company Limited, Director of General Manager’s Office, and Chairman of
the Board of China Merchants Expressway Network & Technology Holdings Co., Ltd. Deng Renjie
has been being the Vice Chairman of the Board of the Company from December 2018 to January
2020, and has been being the Chairman of the Board of the Company since February 2020.
Bai Jingtao, Vice Chairman of the Board and Chief Executive Officer, Professor Level Senior
Engineer, graduated from Department of Water Conservancy of Tianjin University and obtained
bachelor’s degree in port and waterway engineering. Later Bai Jingtao studied at Graduate School
of Wuhan University of Technology, Graduate School of Shanghai Maritime University and
obtained master’s degree in management science and engineering, doctor’s degree in transportation
planning and management respectively. Bai Jingtao now holds the post of the Company’s Director,
CEO and Party Secretary, Managing Director of China Merchants Port Holdings Company Limited
(CM Port Holdings). Bai Jingtao has successively held the posts of Assistant Engineer of CCCC
Water Transportation Consultants Co., Ltd, Principal Staff of Division of Engineering Management
and Division of Infrastructure Management of Ministry of Communications, Deputy Director and
Director of Division of Infrastructure Management and Division of Water Transport of Ministry of
Communications, Vice GM of China Merchants Zhangzhou Development Zone Co., Ltd, Deputy
Director of Xiamen Port Authority, Vice GM of China Merchants International Company Limited,
Executive Deputy Director of Management Committee of China Merchants Zhangzhou Economic
and Technological Development Zone, GM of China Merchants Zhangzhou Economic and
Technological Development Zone Company Limited and GM of Liaoning Port Group Co., Ltd. Bai
Jingtao has been being the Director of the Company since September 2017 and the Director and
Chief Executive Officer of the Company since December 2018, and has been being the Vice
Chairman of the Board and Chief Executive Officer of the Company since April 2020.
Yan Shuai, Director, graduated from Harbin Engineering University, majoring in industrial
automation, and obtained bachelor’s degree in engineering. Later Yan Shuai obtained master’s
degree in management at Beijing University of Aeronautics and Astronautics. Yan Shuai now holds
the posts of Director of Human Resources Department. Yan Shuai has successively held the posts of
Deputy Researcher of General Office of the State Council of the People’s Republic of China
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China Merchants Port Group Co., Ltd. Annual Report 2020
Second Secretariat, Vice President of China Merchants Group Finance Co., Ltd., Deputy Director
(principal person) of Human Resources Department of China Merchants Group Company Limited.
Yan Shuai has been being the Director of the Company since December 2018.
Song Dexing, Director, Senior Engineer, graduated from Department of Mechanics of Wuhan
University of Technology (former name is Wuhan Institute of Water Transportation Engineering),
and obtained bachelor’s degree in engineering. Later Song Dexing obtained master’s degree,
majoring in transportation planning at Wuhan University of Technology and doctor’s degree in
management, majoring in administrative management at Huazhong University of Science and
Technology. Song Dexing now holds the posts of Business Director of Transportation & Logistics,
Minister of Transportation & Logistics Business Department/Beijing Headquarters of China
Merchants Group Company Limited, GM, Secretary of Party Committee of SINOTRANS&CSC.
Song Dexing has successively held the posts of Secretary of Youth League Committee, Engineer of
Water Transport Planning & Design Institute of Ministry of Communications, Principal Staff of
Division of Transport of Ministry of Communications, Deputy Director, Director of Container
Office of Division of Water Transport of Ministry of Communications, Deputy Mayor of Luoyang
Municipal People’s Government (temporary post), Deputy Director of China Waterborne Transport
Research Institute, Deputy Director, Director of Yangtze Three Gorges Navigation Administration,
Deputy Director, Director of Division of Water Transport of Ministry of Communications, Director
of Bureau of Water Transport of Ministry of Transport (Director of Taiwanese Affairs Office of the
ministry), Vice Chairman of the Board, Member of Party Committee, Deputy Secretary of Party
Committee, Secretary of Committee for Discipline Inspection of SINOTRANS&CSC, General
Manager of SINOTRANS&CSC, Director of Department of Comprehensive Logistics Business of
China Merchants Group Company Limited. Song Dexing has been being the Director of the
Company since December 2018.
Zhang Yi, Director, Chief Operational Officer and General Manager, graduated from Wuhan
Institute of Water Transportation Engineering and obtained bachelor’s degree in transportation
management engineering. Later Zhang Yi obtained doctor’s degree in engineering at Wuhan
University of Technology. Zhang Yi now holds the post of Director, the GM & COO of the
Company, Deputy General Manager of China Merchants Port Holdings Company Limited (CM
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China Merchants Port Group Co., Ltd. Annual Report 2020
Port Holdings). Zhang Yi has successively held the posts of Planner of Planning Division of
Zhanjiang Port Authority, Deputy Director of Planning Development Division of Zhanjiang Port
Authority, Assistant Director of Zhanjiang Port Authority, Director, President, Chairman of the
Board, Secretary of Party Committee of Zhanjiang Port Group Company Limited. Zhang Yi has
been being the GM&COO of the Company since December 2018. Zhang Yi has been being the
Director, COO and GM of the Company since May 2020.
Gao Ping, Independent Director, obtained Executive Master of Business Administration from the
University of International Business and Economics (UIBE). He is also a senior engineer and senior
political worker. His former titles included first mate, Management Section Chief, and HR Manager
at Shanghai Ocean Shipping Co., Ltd., HR General Manager at COSCO Container Lines Co., Ltd.,
General Manager at the Crew Department of COSCO (H.K.) Shipping Co., Ltd., Deputy General
Manager at COSCO (H.K.) Shipping Co., Ltd., Deputy General Manager at Shenzhen Ocean
Shipping Co., Ltd. under COSCO (H.K.) Shipping Co., Ltd., General Manager at the Organization
Department/HR Department of China COSCO SHIPPING Corporation Limited (COSCO
SHIPPING Group), part-time supervisor of the Board of Supervisors of Large Key State-owned
Enterprises dispatched by the State Council to COSCO SHIPPING Group, Secretary of the Party
Committee and Deputy General Manager at COSCO Shipping Lines Co., Ltd., member of 11th and
12th Shanghai Committees of the Chinese People's Political Consultative Conference (CPPCC), and
Deputy Director of the Committee for Economic Affairs of the Shanghai Committee of the CPPCC.
He has been an independent director of the Company since May 2020.
Wang Zhenmin, Independent Director, graduated from the Renmin University of China and
specialized in Constitution. He is also an expert receiving a special allowance from the State
Council. Moreover, he is a professor of the School of Law, Dean of the Institute of State
Governance Studies, Tsinghua University, and Director of the Center for Hong Kong and Macao
Research, Tsinghua University. He used to work as a lecturer, associate professor, and Deputy
Director of the Department of Law, Deputy Dean and Dean of the School of Law, Tsinghua
University, and Director of the Department of Law of the Liaison Office of the Central People's
Government in the Hong Kong S.A.R. He has been an independent director of the Company since
May 2020.
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China Merchants Port Group Co., Ltd. Annual Report 2020
Li Qi, Independent Director, graduated from Guanghua School of Management, Peking
University, and majored in Business Management. Currently, she is an associate professor at the
Department of Accounting of the Guanghua School of Management, Peking University. She
worked as a teaching assistant and lecturer at the Department of Accounting and Assistant to the
Dean and Deputy Secretary of the Party Committee of the Guanghua School of Management,
Peking University. She has been an independent director of the Company since May 2020.
Liu Yingjie, Chairman of the Supervisory Committee, graduated from Capital University of
Economics and Business, majoring in accounting, and obtained bachelor’s degree in economics. Liu
Yingjie now holds the post of Director of Risk Control Department/Law and Compliance
Department and Director of Audit Center of China Merchants Group. Liu Yingjie has successively
held the posts of Deputy Director, Director of Division of Comprehensive Audit of Supervision
Department of COSCO, Director of Division of Computer Audit, Assistant Director, Deputy
Director of Risk Control Department/Audit Department of China Merchants Group. Liu Yingjie has
been being the Chairman of the Supervisory Committee of the Company since December 2018.
Hu Qin, Supervisor, graduated from Peking University, majoring in international law, and obtained
master’s degree in law. Later Hu Qin studied at NUS Business School and obtained master’s degree
in management. Hu Qin now holds the post of Deputy Director of Risk Control Department/Law
&Compliance and Senior Director of China Merchants Group. Hu Qin has successively held the
posts of Deputy General Manager of Planning Department of China Merchants Shekou Industrial
Zone Company Limited, General Manager and General Counsel of Department of Legal Affairs,
General Counsel of China Merchants Shekou Industrial Zone Holdings Co., Ltd., Deputy Director
of Risk Control Department of China Merchants Group, Deputy Director of Legal Department. Hu
Qin has been being the Supervisor of the Company Since December 2018.
Yang Yuntao, Supervisor, graduated from Jilin University, majoring in international law, and
obtained bachelor’s degree in law. Later Yang Yuntao studied at School of Law, University of
International Business and Economics, and obtained doctor’s degree in law. Yang Yuntao now holds
the posts of Deputy General Manager and General Counsel of China Merchants Energy Shipping
Co., Ltd.,. Yang Yuntao has successively held the posts of Deputy General Manager of Port
Business Department of Sino-Trans China National Foreign Trade Transportation Corporation,
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China Merchants Port Group Co., Ltd. Annual Report 2020
General Manager of Law Department, Director, Deputy President (principal person) of
SINOTRANS (Hong Kong) Group Company Limited, Non-Executive Director of SINOTRANS
Limited, General Manager of Law Department of Sino-Trans China Foreign Trade Transportation
(Group) Corporation, General Manager, Deputy General Counsel, General Counsel of Law
Department of SINOTRANS & CSC, Deputy Director of Transportation & Logistics Business
Department/Beijing Headquarters of China Merchants Group Company Limited. Yang Yuntao has
been being the Supervisor of the Company since December 2018.
Gong Man, Supervisor, obtained her master's degree in accounting from the Dongbei University of
Finance & Economics. She serves as the Manager at the Financial Management Department of
China Merchants Port Group Co., Ltd. and accountant at the Financial Department of Shekou
Container Terminal Co., Ltd. She has been a supervisor of the Company since May 2020.
Xu Jia, Supervisor, graduated from the Wuhan University of Technology and obtained a master's
degree in Control Theory and Control Engineering. He is the Manager at the Operations
Management Department of China Merchants Port Group Co., Ltd. He worked as a Senior System
Planning Engineer and Project Planning Director at the Engineering Technology Department of
Shekou Container Terminal Co., Ltd. He has been a supervisor of the Company since May 2020.
Zheng Shaoping, Vice General Manager, graduated from Dalian Maritime University for
postgraduate, majoring in international maritime law. Later Zheng Shaoping obtained master’s
degree in business administration at The University of Wales. He now acts as the Vice President of
the Company, the Executive Director and Vice General Manager of China Merchants Port Holdings
Company Limited. He once acted as the Vice General Manager of Shenzhen Chiwan Wharf
Holdings Limited & General Manager of Chiwan Wharf Container Company, Vice General
Manager and Director of Shenzhen Chiwan Wharf Holdings Limited, General Manager and
Director of Shenzhen Chiwan Wharf Holdings Limited, General Manager and Vice Chairman of the
Board of Shenzhen Chiwan Wharf Holdings Limited, General Manager and Chairman of the Board
of Shenzhen Chiwan Wharf Holdings Limited, Vice General Manager of China Nanshan
Development (Group) Inc., Vice General Manager and Executive Director of China Merchants
Holdings （ International ） Company Limited, Vice General Manager (General Manager Level)
and Executive Director of China Merchants Holdings （International） Company Limited. He has
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China Merchants Port Group Co., Ltd. Annual Report 2020
been being the Vice President of the Company since December 2018.
Lu Yongxin, Vice GM and Acting CFO, graduated from Dalian University of Technology, and
obtained bachelor’s degree in English for science and technology. Later Lu Yongxin graduated from
Curtin University and obtained master’s degree in project management. Lu Yongxin now holds the
post of Deputy GM of the Company, Deputy General Manager of China Merchants Port Holdings
Company Limited (CM Port Holdings). Lu Yongxin has successively held the posts of Assistant
General Manager of Zhenhua Construction Co. Ltd., Deputy Director of CHEC (Beijing) Head
Office, Deputy General Manager of Research & Development Department of China Merchants Port
Holdings Company Limited (CM Port Holdings), General Manager of Overseas Business
Department, Assistant General Manager. Lu Yongxin has been dispatched to Terminal Link in
France to act as CFO and Senior Vice President. Lu Yongxin has been as the Deputy GM of the
Company since December 2018 and the Acting CFO of the Company since May 2020.
Li Yubin, Vice GM and Acting Secretary of the Board, graduated from Tianjin University,
majoring in Harbor and Cannel Engineering with the bachelor of engineering degree, Tianjin
University, majoring in engineering management, and obtained master’s degree. Later Li Yubin
graduated from The University of Hong Kong and obtained doctor’s degree in real estate and
construction. Li Yubin now holds the post of Deputy GM and Chief Digital Officer of the Company
and Deputy General Manager of China Merchants Port Holdings Company Limited (CM Port
Holdings). Li Yubin has successively held the posts of Deputy General Manager of Road and
Bridge Project of China Harbor Company in Bangladeshi Office, Project Director of Overseas
Business Department of CHEC, Assistant General Manager of Planning and Commerce Department,
R&D Department and Overseas Branches Department of China Merchants Holdings (International)
Company Limited, General Manager, Deputy General Economist of Strategy and Operation
Management Department of China Merchants Port Holdings Company Limited (CM Port Holdings)
&General Manager and Chairman of the Board of China Merchants Bonded Logistics Co., Ltd. and
the Chief Representative of Representative Office of China Merchants Group in Djibouti. Li Yubin
has been acting the Vice GM of the Company since December 2018 and the Acting Secretary of the
Board of the Company since January 2021.
Xu Song, Vice GM, holds a bachelor's degree in Material Management of the Huazhong University
123
China Merchants Port Group Co., Ltd. Annual Report 2020
of Science and Technology, Master of Business Administration (MBA) of the Dongbei University
of Finance & Economics, Master of International Business (MIB) of the Coventry University, and
Ph.D. in Transportation Planning and Management of the Dalian Maritime University. He is also a
Senior Economist. He used to work as Deputy General Manager at Dalian Port Container Co., Ltd.;
Deputy General Manager and General Manager at Dalian Port Jifa Logistics Co., Ltd.; Secretary of
the Party Committee and General Manager at Dalian Port Container Co., Ltd.; General Manager at
Dalian Port Northern Huanghai Sea Port Cooperative Management Company; General Manager at
Dalian Port (PDA) Company Limited; Deputy General Manager, director, and General Manager and
Deputy Secretary of the Party Committee of Dalian Port; and Deputy General Manager and member
of the Party Committee of Liaoning Port Group Co., Ltd. He has been Deputy General Manager of
the Company since October 2020.
Liu Libing, General Counsel, graduated from the Department of Philosophy, School of Philosophy,
Wuhan University with a Bachelor in Philosophy. Later, he pursued further study at Sun Yat-sen
University School of Law and obtained a Master of Laws. He served as a secretary at China
Construction Third Engineering Bureau Group Co., Ltd., Director-general at China Construction
Shenzhen Decoration Co., Ltd., Production Supervisor at Shenzhen Foxconn (Group) Company,
apprentice lawyer and lawyer at City Development Law Firm, Shenzhen Branch, Manager at the
Legal Affairs Department and Senior Manager of China Merchants Property Development Co., Ltd.,
Manager at the Legal Affairs Department of China Merchants Group Co., Limited, Senior Manager
at the Risk Management Department of China Merchants Group Co., Limited, and Senior Manager
of the General Office and head of the Secretariat of the Board of Directors at China Merchants
Group Co., Limited. He has been the General Counsel of the Company since August 2020.
Offices held concurrently in shareholding entities:
□ Applicable √ Not applicable
Offices held concurrently in other entities:
Remuner
ation or
Office held in
Name Other entity Start of tenure End of tenure allowanc
the entity
e from
the entity
Deng
China Merchants Group Co., Limited Vice GM March 2015 Yes
Renjie
Deng Chairman of November
Liaoning Port Group No
Renjie the Board 2018
124
China Merchants Port Group Co., Ltd. Annual Report 2020
Deng Chairman of
Yingkou Port Group Co., Ltd. April 2019 No
Renjie the Board
Chairman of
Deng the
China Merchants Steamship Co., Ltd. June 2017 March 2020 No
Renjie Supervisory
Committee
Deng
China Merchants Steamship Co., Ltd. Director March 2020 No
Renjie
Deng December
China Merchants Group (H.K.) Limited Director No
Renjie 2015
Deng Chairman of
Dalian Port Group Corporation Limited May 2019 No
Renjie the Board
Bai
Liaoning Port Group Director April 2020 No
Jingtao
Bai
Terminal Link Director June 2017 No
Jingtao
Vice
Bai
Shanghai International Port (Group) Co., Ltd. Chairman of June 2016 No
Jingtao
the Board
Bai China Merchants Taiping Bay Development April 2020
Director No
Jingtao Investment Co., Ltd.
Bai China Merchants Northeast Asia April 2020
Director No
Jingtao Development Investment Co., Ltd.
Yan China Merchants Group (Shanghai) Co.,
Director July 2016 No
Shuai Limited
Director of
Song Transportatio
China Merchants Group Co., Limited May 2019 No
Dexing n & Logistics
Business
Minister of
Transportatio
n & Logistics
Division/
Song
China Merchants Group Co., Limited Minister of August 2018 No
Dexing
the
Headquarters
of the Group
in Beijing
Song
SINOTRANS&CSC GM June 2016 Yes
Dexing
Song Executive September
SINOTRANS&CSC Yes
Dexing director 2016
Song Chairman of
Nanjing Port (Group) Co., Ltd. October 2017 April 2020 No
Dexing the Board
Vice
Song
China Merchants Energy Shipping Co., Ltd. Chairman of August 2018 No
Dexing
the Board
Song September
Liaoning Port Group Director No
Dexing 2019
Vice
Song
Sinotrans Limited Chairman of June 2018 No
Dexing
the Board
Song Executive December
Sinotrans Limited No
Dexing director 2016
Zhang
Liaoning Port Group Director July 2020 No
Yi
125
China Merchants Port Group Co., Ltd. Annual Report 2020
Zhang
Liaoning Port Group GM April 2020 No
Yi
China Merchants Taiping Bay Development Vice
Zhang
Investment Co., Ltd. Chairman of April 2020 No
Yi
the Board
Zhang China Merchants Northeast Asia
Director April 2020 No
Yi Development Investment Co., Ltd.
Zhang China Merchants Hainan Development & December
Director No
Yi Investment Co., Ltd. 2018
Chairman of
Liu the
Sinotrans Limited March 2019 No
Yingjie Supervisory
Committee
Chairman of
Liu the
China Merchants Group Finance Co., Ltd. August 2019 No
Yingjie Supervisory
Committee
Chairman of
Liu the November
China Yangtze Shipping Group Co., Ltd. No
Yingjie Supervisory 2017
Committee
China Merchants Port Investment
Hu Qin Supervisor May 2015 No
Development Company Limited
China Merchants Shekou Industrial Zone
Hu Qin Supervisor May 2017 No
Holdings Co., Ltd.
China Merchants Hainan Development & December
Hu Qin Supervisor No
Investment Co., Ltd. 2018
Yang December
China Yangtze Shipping Group Co., Ltd. Director No
Yuntao 2018
Vice GM &
Yang December
China Merchants Energy Shipping Co., Ltd. General Yes
Yuntao 2020
Counsel
Zheng
Ningbo Daxie China Merchants International
Shaopin Director April 2014 No
Container Terminal Co., Ltd.
g
Zheng
Shaopin Ningbo Zhoushan Port Company Limited Director April 2015 No
g
Zheng
September
Shaopin Tianjin Port Container Terminal Co., Ltd. Director No
2019
g
Zheng
China Merchants International Container
Shaopin Director October 2019 No
Terminal (Qingdao) Co., Ltd.
g
Zheng
Qingdao Port China Merchants International
Shaopin Director October 2016 No
Container Terminal Co., Ltd.
g
Zheng
Qingdao Port Dongjiakou Ore Terminal Co.,
Shaopin Director March 2017 No
Ltd.
g
Zheng
Shaopin Shanghai International Port (Group) Co., Ltd. Director May 2014 No
g
Zheng
Shenzhen China Merchants Qianhai Industrial
Shaopin Director August 2016 No
Development Co., Ltd.
g
126
China Merchants Port Group Co., Ltd. Annual Report 2020
Zheng
Chairman of September
Shaopin Antong Holdings Co., Ltd. No
the Board 2019
g
Zheng
China Merchants Antong Logistics Chairman of September
Shaopin No
Management Co., Ltd. the Board 2019
g
Lu Kumport Liman Hizmetleri ve Lojistik San. Chairman of December
No
Yongxin ve Tic. A.. the Board 2019
Lu Chairman of November
LOME CONTAINER TERMINAL S.A. No
Yongxin the Board 2019
Lu
Terminal Link Director March 2020 No
Yongxin
Vice
Lu
Tin-can Island Container Terminal Ltd Chairman of July 2019 No
Yongxin
the Board
Li Yubin MODERN TERMINALS LIMITED Director March 2015 No
Li Yubin Shenzhen Lianyongtong Terminal Co., Ltd. Director January 2014 No
Silk Road Yishang Information Technology Chairman of
Li Yubin January 2019 No
Co., Ltd. the Board
Offices of directors, supervisor, and senior management held concurrently in other entities exclude
Note
offices held in the Company and subsidiaries within the consolidation scope.
Punishments imposed in the recent three years by the securities regulator on the incumbent directors,
supervisors and senior management as well as those who left in the Reporting Period:
□ Applicable √ Not applicable
IV Remuneration of Directors, Supervisors and Senior Management
Decision-making procedure, determination basis and actual payments of remuneration for directors,
supervisors and senior management:
Decision-making procedure for the remuneration of directors, supervisors and senior management:
Remunerations for the Company’s directors, supervisors and senior management shall be nominated
by the Board of Directors and determined upon review of the Remuneration and Appraisal
Committee. Allowance for the 9th Independent Directors is RMB150,000/year (tax included), which
has been approved at the 3rd Extraordinary General Meeting of 2018. Allowance for the 10th
Independent Directors is RMB150,000/year (tax included), which has been approved at the 2019
Annual General Meeting.
Determining basis for the remuneration of directors, supervisors and senior management: The
modes and amounts of the remuneration for directors, supervisors and senior management are
determined according to the market levels with the post value, responsibilities, etc. taken into
account.
Actual payment for the remuneration of directors, supervisors and senior management: Salaries and
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China Merchants Port Group Co., Ltd. Annual Report 2020
independent director allowances were paid to directors, supervisors and senior executives on a
monthly basis. And the other bonuses were paid all at one time according to the performance of
each of them.
Remuneration of directors, supervisors and senior management for the Reporting Period
Total before-tax
Any
remuneration
Incumbent/For remuneration
Name Office title Gender Age from the
mer from related
Company
party
( RMB’0,000)
Deng
Chairman of the Board Male 51 Incumbent 0 Yes
Renjie
Bai Vice Chairman of the
Male 55 Incumbent 305 No
Jingtao Board and CEO
Yan Shuai Director Male 48 Incumbent 0 Yes
Song
Director Male 58 Incumbent 0 Yes
Dexing
Zhang Yi Director, COO and GM Male 50 Incumbent 271 No
Gao Ping Independent director Male 65 Incumbent 9 No
Wang
Independent director Male 54 Incumbent 9 No
Zhenmin
Li Qi Independent director Female 50 Incumbent 9 No
Liu Chairman of the
Male 49 Incumbent 0 Yes
Yingjie Supervisory Committee
Hu Qin Supervisor Female 54 Incumbent 0 Yes
Yang
Supervisor Male 54 Incumbent 0 Yes
Yuntao
Gong
Supervisor Female 32 Incumbent 33 No
Man
Xu Jia Supervisor Male 39 Incumbent 33 No
Zheng
Vice GM Male 58 Incumbent 260 No
Shaoping
Lu
Vice GM and Acting CFO Male 51 Incumbent 210 No
Yongxin
Vice GM and Acting
Li Yubin Male 49 Incumbent 333 No
Secretary of the Board
Xu Song Vice GM Male 49 Incumbent 29 No
Liu
General Counsel Male 48 Incumbent 45 No
Libing
Fu Former Chairman of the
Male 54 Former 0 Yes
Gangfeng Board
Su Jian Former Director Male 49 Former 0 Yes
Yuan Former Independent
Male 70 Former 6 No
Yuhui director
Former Independent
Su Qiyun Male 57 Former 6 No
director
Li
Former Independent
Changqin Male 52 Former 6 No
director
g
Ni Keqin Former Supervisor Female 56 Former 83 No
Zheng Male
Former Supervisor 50 Former 85 No
Linwei
128
China Merchants Port Group Co., Ltd. Annual Report 2020
Former Vice GM and
Huang
Former Secretary of the Male 38 Former 233 No
Chuanjing
Board
Former CFO
Wen Ling Female 55 Former 89 No
Total -- -- -- 2,054 --
Equity incentives for directors, supervisors and senior management in the Reporting Period:
On 3 February 2020, the Company held the 1st Extraordinary General Meeting of 2020, at which the
following matters were reviewed and approved: Stock Options Incentive Plan (Draft) and its
Abstract, Stock Options Incentive Plan (Phase I) (Revised Draft) and its Abstract, Management
Method for Stock Options Incentive Plan, Examination Method for Implementation of Stock
Options Incentive Plan and Proposal on Authorization to the Board to Handle Matters in Relation to
Stock Options Incentive. The details about the stock options granted to directors and senior
management of the Company in the incentive plan are as follows:
Shares
granted (ten As % of total As % of total share
No. Name Office title
thousand granted capital
shares)
Vice Chairman of the Board
1 Bai Jingtao 42.0 2.37% 0.022%
and CEO
2 Yan Shuai Director 42.0 2.37% 0.022%
3 Zhang Yi Director, COO and GM 35.0 1.97% 0.018%
Zheng
4 Vice GM 35.0 1.97% 0.018%
Shaoping
5 Lu Yongxin Vice GM and Acting CFO 24.0 1.35% 0.012%
Vice GM and Acting
6 Li Yubin 24.0 1.35% 0.012%
Secretary of the Board
Former Vice GM and
Huang
7 Former Secretary of the 24.0 1.35% 0.012%
Chuanjing
Board
8 Wen Ling Former CFO 24.0 1.35% 0.012%
142 core managers 1,205.8 68.02% 0.627%
88 core management backbones and technical
264.0 14.89% 0.137%
backbones of core businesses
Shares reserved 53.0 3% 0.028%
Total 1,772.8 100% 0.922%
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China Merchants Port Group Co., Ltd. Annual Report 2020
At the 1st Extraordinary Meeting of the 10th Board of Directors in 2021 and the 1st Extraordinary
Meeting of the 10th Supervisory Committee in 2021 held on 29 January 2021, Proposal on the Grant
of Stock Option (the Reserved) to Incentive Objects of the Stock Option Incentive Plan (Phase I) of
the Company was considered and approved respectively. The stock options granted to directors and
senior management of the Company for the incentive plan are as follows:
Number of
stock
As % of total share
options As % of total
No. Name Office title capital
granted (ten granted
thousand
shares)
1 Xu Song Vice GM 24 1.35% 0.012%
2 Liu Libing General Counsel 5 0.29% 0.003%
1 core manager 24 1.35% 0.012%
Total 3 people 53 2.99% 0.028%
V Employees
1. Number, Functions and Educational Backgrounds of Employees
Number of in-service employees of the Company as the
330
parent
Number of in-service employees of major subsidiaries 15,289
Total number of in-service employees 15,619
Total number of paid employees in the Reporting Period 15,619
Number of retirees to whom the Company as the parent or
9,513
its major subsidiaries need to pay retirement pensions
Functions
Function Employees
Production 8,358
Sales 592
Technical 3,472
Financial 556
Administrative 2,641
Total 15,619
Educational backgrounds
Educational background Employees
Master’s degree and above 541
Bachelor’s degree 4,034
Junior college 3,801
Technical secondary school and below 7,243
Total 15,619
2. Employee Remuneration Policy
The Company perfected the remuneration incentive mechanism that was market-oriented,
commensurate with economic benefits, and connected with labor productivity, in line with the
principle of giving priority to efficiency and taking count of equity simultaneously, in order to
reinforce vitality and power. By optimizing the remuneration system, the Company effectively
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China Merchants Port Group Co., Ltd. Annual Report 2020
raised its market competitiveness and attracted and retained excellent management personnel and
business backbone. Besides, new incentive mechanisms were proposed. Mid- and long-term
incentives were combined with short-term ones to achieve long-term development. The human
resources management system was fully optimized and streamlined during the development of a
smart HR management platform. Standardized procedures for objective setting, communication,
inspection, and feedback were formulated, based on a smart performance system. Business
assessment results were considered as an important basis of bonuses to fully mobilize the
enthusiasm of employees. In 2020, the Company successfully introduced the employee incentive
scheme. The employee incentive scheme in the first phase was granted. A mechanism for sharing of
profits and risks among the Company and its shareholders and employees was created. The plan
was favorable to improve shareholder value and safeguard owners' rights and interests. Additionally,
it supported strategy implementation and long-term sustainable development of the Company.
Middle and senior management personnel and core elites received targeted incentives.
Amid the adverse impact of the COVID-19 epidemic in 2020, the Company endeavored to
consolidate its internal strength. Quality, effectiveness, and per capita efficiency were strengthened
by deeply exploring relevant indicators like the profit rate of labor costs and adopting effective
measures. Externally, the Company fully utilized preferential policies, such as reduction and
exemption of social insurance and fiscal subsidies, to relieve operating pressure and orderly resume
work and production. During the special period of epidemic prevention and control, the Company
strove to perform its corporate social responsibilities and gave top priority to the health and safety
of its employees. It cared about both the physical and mental health of its employees and provided
its employees and their family members with psychological guidance. In addition, special funds
were input to prevent and control the virus and minimize the impact. More incentives were granted
to front-line staff engaging in pandemic prevention and control. Advanced models were
commended. The Company spared no effort for employee care.
3. Employee Training Plans
Focusing on its strategic goals, the Company is dedicated to creating a platform for the development
and promotion of global port professionals, provides domestic and foreign employees with learning
opportunities, opens channels for global career development and helps employees to keep
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China Merchants Port Group Co., Ltd. Annual Report 2020
improving themselves with the development of the Company. Meanwhile, it provides its peers with
opportunities of coming to China for exchange to share knowledge and values. In 2020, CMPort
(i.e., the Company) rapidly adjusted its training methods in consideration of the pandemic. Online
training replaced offline intensive training. Over 700 courses were uploaded to the online platform,
most of which were anti-pandemic information and knowledge. The online learning demand of
employees during the pandemic was effectively satisfied through posts and exams. Average monthly
active users accounted for 96.2% of the total employees. Meanwhile, the online platform was fully
applied to training. All members utilized the online platform to produce livestreaming and online
courses and develop internal quality courses. As a result, the coverage of training during the
pandemic was expanded. Companies deepened collaboration in training. Pandemic prevention and
control across the Group were strongly promoted. The pandemic was alleviated in the second half
of 2020. The Company integrated internal and external training resources to offer a series of
training programs centering on key topics. For example, senior executives were organized to learn
new infrastructure construction. The Financial Talent Cultivation Program of the Company was
launched. The Company joined hands with professional institutions to improve the professional and
common skills of employees through internal, public, livestreaming, and online courses.
Several sessions of the "China Merchants C-Blue Training Program" (hereinafter referred to as the
"C-Blue Program") have been held by CMG, winning good reputation and results. The COVID-19
epidemic in 2020 posed challenges to the C-Blue Program. As the epidemic could not be contained
within a short time, CMPort overcame difficulties and cooperated with the University of Djibouti to
jointly create innovative online courses. On 17 November 2020, the China Merchants C-Blue
Training Program-Sailing (Djibouti Session) kicked off in the China Merchants Port Plaza and the
University of Djibouti by videoconference, which was recognized by the Ministry of Transport of
the People's Republic of China and the Ministry of Higher Education and Research of Djibouti. The
C-Blue Program-Sailing not only demonstrated CMG’s mission and sincerity of "promote the
progress of the times with commercial success" to the world, but also cultivated talent reserve for
the global port and shipping industry and contributed to the quality economic development of
countries along the "Belt and Road" Initiative.
4. Labor Outsourcing
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China Merchants Port Group Co., Ltd. Annual Report 2020
Total man-hours (hour) N/A
Total remuneration paid (RMB) RMB1,192,878,137.75
133
China Merchants Port Group Co., Ltd. Annual Report 2020
Part X Corporate Governance
I General Information of Corporate Governance
Ever since its establishment, the Company has been in strict compliance with the Company
Law and Securities Law, as well as relevant laws and regulations issued by CSRC. And it has timely
formulated and amended its relevant management rules according to the Code of Corporate
Governance for Listed Companies, which are conscientiously and carefully executed. An effective
system of internal control has thus taken shape in the Company. Details about corporate governance
within the Reporting Period are set out as below:
1. During the Reporting Period, the Company revised two systems. The Company revised the Rules
of Procedures for Office Meetings based on the actual operation situation, in which formal
participants and formal persons present have been supplemented. Meanwhile, in accordance with
the requirement of legal system building from SASAC and newly issued Guidelines of Shenzhen
Stock Exchange for Standard Operations of Listed Companies, the Company revised the Working
Articles of Audit Committee of the Board of Directors, in which the Company increased the
description of responsibilities related to promoting the legal system building and strengthened the
function of the Board in the legal system building. The detailed information is as follows:
Name of system Review Disclosure
System revised
Rules of Procedures for Office Meetings Has been
Has been reviewed and approved on the 2nd
Meeting of the 10th Board of Directors held disclosed on
Working Articles of Audit Committee of the Board of Cninfo in
Directors on 27 August 2020.
time
2. The special action of "performing entity responsibilities, improving governance, and achieving
quality development" was implemented
The Company implemented the special action of "performing entity responsibilities, improving
governance, and achieving quality development", in conformity with the Notice of Shenzhen CSRC
on Promoting Listed Companies Within Jurisdiction to Perform Entity Responsibilities, Improve
Governance, and Achieve Quality Development (S.Z.J.G.S.Z. [2020] No. 128, hereinafter referred
to as the "Notice"), in order to implement the Opinions of State Council on Further Improving
Quality of Listed Companies (G.F. [2020] No. 14, hereinafter referred to as the "Opinions"). The
134
China Merchants Port Group Co., Ltd. Annual Report 2020
main work content is as follows:
Upon receipt of the Notice, the Company timely forward it to the controlling shareholder and
persons acting in concert. Meanwhile, directors, supervisors, and senior executives of the Company
and its important subsidiaries were organized to learn the Opinions and the Notice. The Company
performed deep self-inspection, after conscientiously streamlining 10 requirements, including
"improving corporate governance, prohibiting financial frauds, completely eradicating illegal
guarantee and fund embezzlement, constantly strengthening prevention and control of insider
dealing, actively mobilizing substantial shareholders to prevent and mitigate the risk of the pledge
of stock rights, reasonably and steadily conducting M&As and restructuring, conscientiously
disclosing information on changes in interest in shares of listed companies, performing all
commitments in a legal and compliant manner, prudently engaging auditors, and highlighting
investor relation management". Besides, it compiled the Self-inspection Report on Promoting Listed
Companies to Perform Entity Responsibilities, Improve Governance, and Achieve Quality
Development (hereinafter referred to as the "Report").
The self-inspection did not identify any violations by the Company. Hence, the Company will
improve the following aspects: First, it will further enhance its corporate governance and
standardized operation. It will continuously improve relevant internal control policies and establish
and perfect the corporate governance structure and the internal control system in accordance with
the latest laws, regulations, and regulatory requirements as well as its actual situation. Second,
training and publicity of relevant regulations will be reinforced. The Proposal on Promoting Listed
Companies to Perform Entity Responsibilities, Improve Governance, and Achieve Quality
Development (Announcement No.: 2020-088, see the Cninfo website for details) was considered
and approved at the 3rd Extraordinary Meeting of the 10th Board of Directors in 2020. In addition,
the Report was submitted to the Shenzhen CSRC.
The Company will seize opportunities brought by this special action and keep in mind "Four Awes"
and the Four Bottom Lines of "no disclosure of false information, no insider dealing, no
manipulation of market prices, and no damage to interests of listed companies". It will continue to
intensify standardized operation and disclose quality information. Additionally, it will attach more
importance to listed company governance, shareholder returns, improvement of financial
135
China Merchants Port Group Co., Ltd. Annual Report 2020
information quality, and investor relationship management, further improving the quality of listed
companies. The Company will endeavor to boost the steady and wholesome progress of the capital
market and achieve more win-win success amid the benign interaction in the capital market.
3. Shareholders and shareholders’ general meeting: the Company ensures that all the shareholders,
especially minority shareholders, are equal and could enjoy their full rights. The Company called
and held shareholders’ general meeting strictly in compliance with the Rules for Shareholders’
General Meeting.
4. Relationship between the controlling shareholder and the Company: controlling shareholder of
the Company acted in line with rules during the reporting period, did not intervened the decisions,
productions or operations of the Company directly or indirectly in exceeding the authority of the
shareholders’ general meeting, and did not occupy any funds of the Company.
5. Directors and the Board of Directors: the Company elected directors in strict accordance with the
Articles of Association. Number and composition of members of the Board were in compliance
with relevant laws and regulations; all Directors attend Board meetings and shareholders’ general
meeting in a serious and responsible manner and participated enthusiastically relevant training so as
to know better about laws and regulations as well as the rights, obligations and liabilities of
Directors. The Company The Company set up the Audit Committee as approved by The 1st
Extraordinary General Meeting of 2004 and the Nomination, Remuneration and Evaluation
Committee and Strategy Committee as approved by the 2005 Annual General Meeting, with a view
to ensuring the efficient operation and scientific decision-making of the Board of Directors.
6. Supervisors and the Supervisory Committee: number and composition of the members of the
Supervisory Committee were in compliance with the requirements of laws and regulations. The
supervisors diligently and seriously performed their duties and obligations, took responsible
attitudes to all shareholders and supervised the financial affair as well as the performance by the
Company’s Directors, managers and other senior executives of their duties in compliance with the
laws and regulations.
7. Stakeholders: the Company fully respected and safeguarded the legal rights and interests of the
banks and other creditors, staff, clients and other stakeholders so as to develop the Company in a
consistent and healthy way.
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China Merchants Port Group Co., Ltd. Annual Report 2020
8. Information disclosure and transparency: As the department for the management of information
disclosure, the Board of Directors of the Company is responsible for managing the information
disclosure matters of the Company. Chairman of the Board assumes a central role in managing the
information disclosure matters of the Company while the Board Secretary is responsible for
organizing and coordinating such matters. The Board Secretary of the Company is responsible for
the management of investor relationships. Unless expressly authorized and trained, other directors,
supervisors, senior management members and staff members of the Company should avoid
speaking on behalf of the Company in investor relationship activities. The Company disclosed
relevant information in a true, accurate, complete and timely way in strict accordance with the
requirements of laws, regulations and the Articles of Association, formulated the Management
Rules on Information Disclosure, the Management System on Inside Information and Insiders and
the Rules on the Management of Investors Relations, and designated Securities Times, Shanghai
Securities News, Ta Kung Pao and http://www.cninfo.com.cn as its newspaper and website for
information disclosure, so as to ensure all shareholders have equal opportunity to obtain the
information.
9. Corporate governance mechanisms and rules that the Company has already established:
Articles of Association of the Company, Rules of Procedure for General Meetings, Working Articles
of Audit Committee of the Board of Directors, Working Rules of Annual Report for Audit
Committee of the Board of Directors, Working Articles for Nomination, Remuneration and
Evaluation Committee of the Board of Directors; Working Articles of Strategy Committee of the
Board of Directors, Working System for Independent Directors, Working Rules of Annual Report
for Independent Directors, Rules of Procedure for Supervisory Board, Working Articles of Chief
Executive Officer, Management System for Company Shares held by Directors, Supervisors and
Senior Executives and Its Changes, Management System of Foreign Investment, Management
System of Related Transactions, Management System of Fund-raising, Management Rules on
Information Disclosure, Rules of Accountability for Significant Mistakes in Annual Report
Information Disclosure, Management System on Inside Information and Insiders, Internal Audit
System, Management System of Investors’ Relations, Specific System for Engaging Accountants,
Management Method of Financial Tools, Management System on Person in Charge of Finance and
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China Merchants Port Group Co., Ltd. Annual Report 2020
CFO, Information Disclosure Management Rules for the Inter-bank Debt Financing Instrument,
Management System of External Guarantees, Working Articles of Board Secretary, Management
System of Securities Investments, Management System of Subsidiaries, Management Method of
Donations, Rules of Procedures for Office Meeting etc. There isn’t difference between the actual
circumstances of the Company and all established systems.
Since the foundation, the Company was consistently in strict accordance with Company Law and
relevant laws and regulations to make a standard operation, continued business-running in line with
relevant requirements of Corporate Governance Principle for Listed Companies and earnestly made
effort to protect profit and interests of shareholders and stakeholders.
Indicate by tick market whether there is any material incompliance with the regulatory documents
issued by the CSRC governing the governance of listed companies.
□ Yes √ No
No such cases in the Reporting Period.
II The Company’s Independence from Its Controlling Shareholder in Business, Personnel,
Asset, Organization and Financial Affairs
The Company is absolutely independent in business, personnel, assets, finance and organization
from its controlling shareholder. Details are set out as follows.
Separation in business: The Company has its own assets, personnel, qualifications and ability to
carry out operating activities and is able to operate independently in the market. Separation in
personnel: The Company has basically separated its staff from its controlling shareholder. No senior
management staff of the Company holds positions at controlling shareholder of the Company.
Separation in assets: The Company possesses its own self-governed assets and domicile. Separation
in organization: The Company has established and improved the corporate governance structure
according to law and has an independent and complete organizational structure. Separation in
finance: The Company has set up its own financial department as well as normative accounting
system and the financial management system on its subsidiaries. The Company has its own bank
accounts and does not share the same bank account with its controlling shareholder. The Company
has been paying tax in accordance with the laws and regulations on its own behalf.
III Horizontal Competition
138
China Merchants Port Group Co., Ltd. Annual Report 2020
□ Applicable √ Not applicable
IV Annual and Special General Meetings Convened during the Reporting Period
1. General Meeting Convened during the Reporting Period
Investor
Index to disclosed
Meeting Type participatio Date of the meeting Disclosure date
information
n ratio
For the resolution
The 1st announcement
Extraordinary Extraordinary (No. 2020-011),
88.69% 3 February 2020 4 February 2020
General Meeting General Meeting see
of 2020 http://www.cninf
o.com.cn
For the resolution
announcement
The 2019 Annual Annual General (No. 2020-050),
90.18% 22 May 2020 23 May 2020
General Meeting Meeting see
http://www.cninf
o.com.cn
2. Special General Meetings Convened at the Request of Preferred Shareholders with
Resumed Voting Rights
□ Applicable √ Not applicable
V Performance of Duty by Independent Directors in the Reporting Period
1. Attendance of Independent Directors at Board Meetings and General Meetings
(1) General Election of Independent Directors
For the expiration of appointments of the independent directors of the 9th Board of Directors Mr.
Yuan Yuhui, Mr. Su Qiyun and Mr. Li Changqing, the Company held the 2019 Annual General
Meeting for the general election of the Board on 22 May 2020, on which, Mr. Gao Ping, Mr. Wang
Zhenmin and Mrs. Li Qi were elected as the independent directors of the 10th Board of Directors.
(2) Attendance of Independent Directors at Board Meetings and General Meetings
Attendance of the 9th independent directors at board meetings and general meetings
The
Total
independent
number of Board
Board Board director
board Board meetings the
meetings meetings failed to General
Independent meetings the meetings independent
attended by attended attend two meetings
director independent attended on director
telecommuni through a consecutive attended
director was site failed to
cation proxy board
eligible to attend
meetings
attend
(yes/no)
Yuan Yuhui 5 1 4 0 0 No
Su Qiyun 5 1 4 0 0 No 2
Li Changqing 5 1 4 0 0 No
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China Merchants Port Group Co., Ltd. Annual Report 2020
Attendance of the 10th independent directors at board meetings and general meetings
The
Total
independent
number of Board
Board Board director
board Board meetings the
meetings meetings failed to General
Independent meetings the meetings independent
attended by attended attend two meetings
director independent attended on director
telecommuni through a consecutive attended
director was site failed to
cation proxy board
eligible to attend
meetings
attend
(yes/no)
Gao Ping 6 2 4 0 0 No
Wang Zhenmin 6 2 4 0 0 No 1
Li Qi 6 2 4 0 0 No
Why any independent director failed to attend two consecutive board meetings:
□ Applicable √ Not applicable
2. Objections Raised by Independent Directors on Matters of the Company
Indicate by tick mark whether any independent directors raised any objections on any matter of the
Company.
□ Yes √ No
No such cases in the Reporting Period.
3. Other Information about the Performance of Duty by Independent Directors
Indicate by tick mark whether any suggestions from independent directors were adopted by the
Company.
√ Yes □ No
Specification of whether suggestions from independent directors are adopted or not adopted by the
Company
During the Reporting Period, all independent directors of the Company show their probity and self-
discipline, fulfill their duties in line with their expertise and experience; earnestly and diligently
perform their duties. The independent directors actively asked for information about the Company’s
business and operation, protected the interests of minority shareholders, brought their roles as
independent directors into full play by participating in discussions on reports reviewed at board
meetings and other issues of the Company, and proposed professional suggestions on standard
governance and production operation which had been adopted by the Company. They carefully
reviewed and issued independent opinions in written form on significant events such as material
related-party transactions in accordance with relevant requirements and had played an important
role in scientific decision-making of the Board. In accordance with the requirements of CSRC and
Shenzhen Stock Exchange, the “Working Rules for Independent Directors” and the “Working Rules
for Independent Directors Concerning Annual Reports”, they performed their obligations with due
diligence and fully oversaw the preparation and disclosure of the Annual Report of the Company.
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For details of performance by independent directors of their duties, please refer to the Work Report
of Independent Directors for 2020 as disclosed at http://www.cninfo.com.cn.
VI Performance of Duty by Specialized Committees under the Board in the Reporting Period
(I) Performance of the Audit Committee of the Board of Directors
The members of the 9th Audit Committee include Independent Director Li Changqing (convener),
Director Su Jian, and Independent Director Su Qiyun. The member of the 10th Audit Committee
include Independent Director Li Qi (convener), Director Su Jian, and Independent Director Wang
Zhenmin. During the Reporting Period, the Audit Committee of the Board worked in line with the
requirements of CSRC and Articles of Association, Working Rules for the Audit Committee of the
Board (hereinafter referred to as the “Working Rules”) and the Working Practices for the Audit
Committee of the Board on Annual Report (hereinafter referred to as the “Working Practices”),
performed their duties, and gave full play of their expertise and experience to earnestly examine the
Company's annual audit, review of financial statement, internal control, and other significant
financial information, and provide the Board of Directors’ scientific and efficient decision-making
with professional support.
1. Particulars about the Meetings
During the Reporting Period, the Audit Committee of the Board held a total of six meetings, with
details as follows:
(1) The 1st Meeting of the Audit Committee of the 9th Board of Directors for 2020
On 14 April 2020, it was held at Conference Room 25A, China Merchants Port Plaza, Shekou
Industry 3rd Road, Shenzhen in the form of on-site combining with network, at which the following
proposals were reviewed and approved unanimously:
Proposal on Work Report of Accounting Firm for 2019;
Proposal on Financial Report of 2019;
Proposal on Renewal of Appointment of Accounting Firm for 2020;
Proposal on Anti-fraud Risk Assessment Report for 2019;
Proposal on Internal Auditing Report for 2019;
Proposal on Internal Auditing Plan for 2020;
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Special Explanation on the Deposit and Usage of Raised Fund for 2019;
Proposal on Working Report of the Audit Committee of the Board in 2019.
(2) The 2nd Meeting of the Audit Committee of the 9th Board of Directors for 2020
On 28 April 2020, it was held by telecommunication meeting at which the following proposals were
reviewed and approved unanimously:
Proposal on Internal Auditing Report for the First Quarter of 2020;
Proposal on the Deposit and Usage of Raised Fund for the First Quarter of 2020.
(3) The 1st Meeting of the Audit Committee of the 10th Board of Directors for 2020
On 22 May 2020, it was held by telecommunication meeting at which the Proposal on Electing the
Convener of the Audit Committee of the 10th Board of Directors and Determining the Contact
Person of the Working Group was reviewed and approved unanimously.
(4) The 2nd Meeting of the Audit Committee of the 10th Board of Directors for 2020
On 27 August 2020, it was held at Conference Room 25A, China Merchants Port Plaza, Shekou
Industry 3rd Road, Shenzhen on site, at which the following proposals were reviewed and approved
unanimously:
Proposal on Interim Financial Report for 2020;
Proposal on Internal Auditing Report for the Second Quarter of 2020;
Proposal on Inspection Report for the Deposit and Usage of Raised Fund for the First Half of 2020.
(5) The 3rd Meeting of the Audit Committee of the 10th Board of Directors for 2020
On 29 October 2020, it was held by telecommunication meeting at which the following proposals
were reviewed and approved unanimously：
Proposal on Internal Auditing Report for the Third Quarter of 2020;
Proposal on Inspection Report for the Deposit and Usage of Raised Fund for the Third Quarter of
2020.
(6) The 4th Meeting of the Audit Committee of the 10th Board of Directors for 2020
On 30 December 2020, it held at Conference Room 25B, China Merchants Port Plaza, Shekou
Industry 3rd Road, Shenzhen in the form of on-site combining with network, at which the Audit
Report on the Company’s Finance and Internal Control by Deloitte Touche Tohmatsu Certified
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China Merchants Port Group Co., Ltd. Annual Report 2020
Public Accountants LLP for 2020 was debriefed by the Committee members.
2. Performance of Duties to the Audit Work of Financial Statements of the Company
In accordance with relevant requirements of CSRC and Shenzhen Stock Exchange, the specific
working rules and procedure for the Audit Committee, during the reporting period, the Audit
Committee of the Board of the Company oversaw the audit work of Financial Statements of the
Company for 2019 with due diligence, details of which are as follows:
(1) Before the auditors started their work, the Audit Committee discussed with the principal auditor
of the accounting firm and determined, inter alia, the timing schedule for the auditing work of the
financial statements for the year.
(2) The Audit Committee expressed its audit opinions two times on the financial statements of the
Company for 2019.
During the Reporting Period, the Audit Committee expressed its audit opinions two times on the
financial statements of the Company for 2019 in accordance with relevant requirements from CSRC.
The Audit Committee reviewed the Financial Statements prepared by the Company and issued the
following opinions before the Auditors started their work: the Company was in full compliance
with relevant laws, regulations and the Articles of Association of the Company, the units and items
of the Company's financial statements to be consolidated were complete, and the consolidation
basis thereof was accurate and the information included in the Financial Statements submitted by
the Company was objective, comprehensive and true. The Company's accounting policies were
properly adopted and the accounting estimates made were reasonable. No significant mistake or
omission has been identified so far. Due to the time-lag between this review of Financial Statements
and the dates of the Auditors' Report, we suggest the Finance Department to focus on and deal with
subsequent events properly in accordance with the New Enterprises Accounting Standards to ensure
the fairness, truthfulness and completeness of the Financial Statements.
After the Auditors issued their preliminary audit opinions, the Audit Committee reviewed the
Financial Statements again and issued the following opinions: the Company prepared the Financial
Statement in full compliance with the New Enterprise Accounting Standards and relevant
provisions of the financial control system of the Company. The procedures for the preparation of
the Financial Statements were reasonable and proper, giving a true and fair view of the Company's
assets, liabilities, equity interests and operation results as at 31 December 2019. Information
included in the Financial Statements was objective and complete. Financial Statements for 2019
which was preliminarily audited by Deloitte Touche Tohmatsu Certified Public Accountants LLP
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China Merchants Port Group Co., Ltd. Annual Report 2020
may be submitted for review at the 7th Meeting of the 9th Board of Directors.
(3) Supervision over the Auditing Work of the Accounting Firm
During the Reporting Period, the Audit Committee issued two letters to Deloitte Touche Tohmatsu
Certified Public Accountants LLP to urge them to produce their audit recommendation on the
financial statements and the summary statement of adjusting events in a timely manner to help our
financial staff finish the preparation of financial statements and related notes for 2019 as soon as
possible, so as to ensure the annual audit and information disclosure proceed as scheduled.
(4) Opinions on the Auditing Work Performed by the Accountants for the previous year
During the auditing period, the Audit Committee of the Board focused on the problems discovered
in the process of auditing, urged auditors to finish the preparation of their report within a prescribed
period of time and ensured the truthfulness, accuracy and completeness of the annual report. The
Certified Public Accountants issued a standard unqualified audit report on 15 April 2020. The Audit
Committee considered that the Certified Public Accountants conducted the audit work of 2019 in
accordance with China’s Independent Auditing Standards, the audit time was sufficient, the
deployment of the auditors was appropriate, and their practicing capability was excellent, and that
the audit report issued sufficiently reflected the Company's financial condition as at 31 December
2019 and its operation results and cash flows for the year 2019 and the audit conclusion made was
in line with the actual situation of the Company.
3. Paying attention to the Internal Control and Internal Audit Work of the Company
During the reporting period, the Audit Committee made standards and requirements to the Audit
Office's report submitted, fully understood the sound establishment and implementation of internal
control system, and focused on problems and suggestions provided by the Audit Office. In addition,
the Audit Committee advised on the improvement for the work of the Audit Department and the
Company relating to internal control for the next year.
(II) Performance of the Nomination, Remuneration and Evaluation Committee
The members of the 9th Nomination, Remuneration and Evaluation Committee include Independent
Director Yuan Yuhui (Convener), Director Yan Shuai and Independent Director Su Qiyun. The
member of the 10th Nomination, Remuneration and Evaluation Committee include Independent
Director Gao Ping (Convener), Director Yan Shuai and Independent Director Wang Zhenmin.
During the Reporting Period, members of the Nomination, Remuneration and Evaluation
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Committee earnestly performed their duties, investigated the equity incentive plan and examined
the remuneration of directors, supervisors and senior executives in term of the requirements and
stipulations of CSRC, Articles of Association, Working Rules of the Nomination, Remuneration
and Evaluation Committee, and responsibilities and obligations empowered by the Board of
Directors.
During the Reporting Period, the Nomination, Remuneration and Evaluation Committee under the
Board of Directors held a total of four meetings, details of which are as follows:
1. On 14 April 2020, the 1st Meeting of the Nomination, Remuneration and Evaluation Committee
of the 9th Board of Directors for 2020 was held at Conference Room 25A, China Merchants Port
Plaza, Shekou Industry 3rd Road, Shenzhen in the form of on-site combining with network, at which
the following proposals were reviewed and approved unanimously:
Proposal on Working Report of the Nomination, Remuneration and Evaluation Committee of the
Board for 2019;
Proposal on Report on the Remuneration of the Directors, Supervisors and Senior Management
Staff for 2019;
Proposal on Inspecting the Candidates for Directors.
2. On 22 May 2020, the 1st Meeting of the Nomination, Remuneration and Evaluation Committee of
the 10th Board of Directors for 2020 was held by telecommunication meeting at which the following
proposals were reviewed and approved unanimously：
Proposal on Electing the Convener of the Nomination, Remuneration and Evaluation Committee of
the 10th Board of Directors and Determining the Group Leader;
Proposal on Appointment of Senior Management.
3. On 27 August 2020, the 2nd Meeting of the Nomination, Remuneration and Evaluation
Committee of the 10th Board of Directors for 2020 was held at Conference Room 25A, China
Merchants Port Plaza, Shekou Industry 3rd Road, Shenzhen in the form of on-site combining with
network, at which the Proposal on Appointment of General Counsel was reviewed and approved
unanimously.
4. On 29 October 2020, the 3rd Meeting of the Nomination, Remuneration and Evaluation
Committee of the 10th Board of Directors for 2020 was held by telecommunication meeting at
which the Proposal on Appointment of Vice GM was reviewed and approved unanimously：
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(III) Performance of the Strategy Committee
The members of Strategy Committee of the 9th Board of Directors include Chairman of the Board
Deng Renjie (Convener), Vice Chairman of the Board Bai Jingtao, director Song Dexing,
independent director Yuan Yuhui, and independent director Li Changqing. The members of
Strategy Committee of the 10th Board of Directors include Chairman of the Board Deng Renjie
(Convener), Vice Chairman of the Board Bai Jingtao, Director Yan Shuai, Director Song Dexing,
Director Zhang Yi, Independent Director Gao Ping, and Independent Director Li Qi. During the
Reporting Period, members of the Strategy Committee in line with the requirements of CSRC,
Article of Association, and the stipulation of Working Rules of the Strategy Committee earnestly
performed their duties, conducted research and advised on the investment plans and assets operation
projects related to the medium to long term development strategy of the Company.
During the Reporting Period, the Strategy Committee under the Board of Directors held a total of
two meetings, details of which are as follows:
1. On 14 April 2020, the 1st Meeting of the Strategy Committee of the 9th Board of Directors for
2020 was held at Conference Room 25A, China Merchants Port Plaza, Shekou Industry 3rd Road,
Shenzhen in the form of on-site combining with network, at which the following proposals were
reviewed and approved unanimously：
Proposal on Working Report of the Strategy Committee of the Board in 2019;
Proposal on Five-Year Strategic Plan of the Company from 2020 to 2024.
2. On 22 May 2020, the 1st Meeting of the Strategy Committee of the 10th Board of Directors for
2020 was held by telecommunication meeting at which the Proposal on Electing the Convener of
the Strategy Committee of the 10th Board of Directors and Determining the Leader of the
Investment Evaluation Group was reviewed and approved unanimously.
VII Performance of Duty by the Supervisory Committee
Indicate by tick mark whether the Supervisory Committee found any risk to the Company during its
supervision in the Reporting Period.
□ Yes √ No
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China Merchants Port Group Co., Ltd. Annual Report 2020
The Supervisory Committee raised no objections in the Reporting Period.
VIII Appraisal of and Incentive for Senior Management
The Company has a mature assessment mechanism and system covering all senior management
personnel. The annual comprehensive assessment combines qualitative and quantitative methods
with the dimensions including performance, competence, self-discipline, etc. The assessment results
of senior management serve as an important basis for appointment and motivation. The Company
adjusts and determines the post salary of senior managers based on the factors including operation
status, position served and assessment results, and determines the performance bonus of managers
through the factors including annual comprehensive ability assessment, annual key performance
indicators appraisal and three-year strategic appraisal results.
The Company strives to be "superior to the market average and peers" regarding as the assessment
and distribution of performance bonuses for senior executives. Senior executives are expected to
compare with themselves chronologically and with their peers horizontally. Short-term KPI
assessment and long-term strategy assessment complement each other. The comprehensive
assessment results of corporate performance are linked with the performance bonuses of senior
executives so as to give full play to the incentive and guiding effects of remuneration. Accordingly,
senior executives pay attention to the short-term performance in the current period or year and the
mid- and long-term development of the Company. In 2020, the Company introduced the employee
incentive scheme and developed a mechanism for the sharing of profits and risks to fully mobilize
the enthusiasm of senior executives.
IX Internal Control
1. Material Internal Control Weaknesses Identified for the Reporting Period
□ Yes √ No
2. Internal Control Self-Evaluation Report
Disclosure date of the internal control self-evaluation report 31 March 2021
For details, see
Index to the disclosed internal control self-evaluation report
www.cninfo.com.cn
Evaluated entities’ combined assets as % of consolidated total assets 97.60%
Evaluated entities’ combined operating revenue as % of consolidated operating
98.70%
revenue
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Identification standards for internal control weaknesses
Weaknesses in internal
Type control over financial Weaknesses in internal control not related to financial reporting
reporting
Great defect Significant defect Common defect
Development direction Development direction Development direction
substantially deviates partly deviates from the slightly deviates from
from the strategic goals, strategic goals, the strategic goals,
investment direction, investment direction, investment direction,
and business structure, and business structure, and business structure,
If a defect or defect commercial modeled. commercial modeled. commercial modeled.
group give rise to the which completely which unable to which completely can't
unable to support the support the realization fully support the
following events which
realization of strategic of strategic goals at a realization of strategic
cannot be prevented or goals larger extent goals
found and made Strategy implementation Strategy implementation Strategy implementation
rectification, the defect is blocked, almost all is blocked, most of is blocked, part of
or defect group are indicators of strategy indicators of strategy indicators of strategy
implementation cannot implementation cannot implementation cannot
recognized as completed as planned completed as planned completed as planned
significant defects: Lead to break off of Lead to break off of Some daily business is
(1) Malpractices of common common influenced, lead to break
business/service or it business/service or it off of common
directors, supervisors
takes half year or above takes three months or business/service or it
and senior to recover the break off half year below to takes three months
management: of common recover the break off of below to recover the
business/service common break off of common
(2) The Company make
business/service business/service
correction to the Badly damage the In a large extent, damage the working
Nature
standard financial report issued; working enthusiasm of damage the working enthusiasm of all the
(3) Certified Public all the employees, will enthusiasm of all the employees, reduce work
give rise to large scale employees, reduce work efficiency, have some
Accountant find that group events or heavy efficiency, have greatly adverse effect to
there is a significant damage to enterprises adverse effect to enterprises culture and
error in the financial culture and enterprises enterprises culture and enterprises cohesion
report, however, the cohesion enterprises cohesion
The employee's ability The employee's ability The employee's ability
internal control did not
and professional skills and professional skills and professional skills
discover it when universally cannot meet in some significant in some fields cannot
conducting internal the enterprise fields cannot meet the meet the enterprise
control; development needs by a enterprise development development
large margin needs
(4) The Audit Negative news spread in Negative news spread in
Negative news spread in
Committee under the the field of the entire the field of the entire
Board and Internal business the field of the entire
(including business, or was paid
Audit Service's extending to industry attention or reported by business, have small
supervision to the chain),or was paid the local media the damage to the reputation
internal control is attention by the national recovery of reputation
of the enterprise, the
invalid. media or public media, will take three to six recovery of reputation
the recovery of months
reputation will take will take three months
more than six months below
The enterprise's internal The enterprise's internal The enterprise's internal
confidential information confidential information confidential information
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China Merchants Port Group Co., Ltd. Annual Report 2020
leakage which badly leakage which affect the leakage which affect the
affect the enterprise's enterprise's competitive enterprise's competitive
competitive capacity in capacity in the market, capacity in the market,
the market, or affect the or affect the competitive or affect the competitive
competitive capacity in capacity in management capacity in management
management in a large extent in a general extent
The judging standard was the net profits attributable to the parent
Company's shareholders in the consolidated financial statements audited in
last year.
Great defect Significant defect Common defect
Have a significant Have a greater adverse Have an adverse impact
adverse impact on the impact on the asset on the asset turnover
asset turnover ability, turnover ability, which ability, which lead to
which lead to total asset lead to total asset total asset turnover rate
turnover rate lowed 20% turnover rate lowed10% lowed10% below
above (Including to 20% (Including
20％） 10%）
Had significant adverse Had larger adverse Had adverse impact to
impact to the annual impact to the annual the annual operation
operation profits or operation profits or profits or cause decrease
cause decrease of annual cause decrease of annual of annual operation
The judging standard operation profits when operation profits when profits when at 1%
was the net profits at 5% (including 5%) at 1% (including 1%) to below of judging
attributable to the above of judging 5% judging standard standard
parent Company's standard
shareholders in the Had significant adverse Had larger adverse Had adverse impact to
consolidated financial impact to decrease of impact to decrease of decrease of inflow of
statements audited in inflow of total cash flow inflow of total cash flow total cash flow or
last year. Misstatement or increase of outflow or increase of outflow increase of outflow
total cash flow when at total cash flow when at total cash flow when at
Quantitative amount ≥ 5% above of
standard judging standard was 10% (including 10%) 5% (including 5%) to 5% below of judging
great defect; 5% above of judging 10% above of judging standard
judging standard ＞1% standard standard
misstatement amount Great investment Larger investment Great investment
mistake incurred which mistake incurred which mistake incurred which
was significant defect;
misstatement amount cause direct economy cause direct economy cause direct economy
losses when at 5% losses when at 1% losses when at 1%
＜1% below of judging
(including 5%) above of (including 1%)to 5% of below of judging
standard was general
judging standard or the judging standard or the standard or the return on
standard.
return on investment return on investment investment less than
more than 40% lower less than 30%(including 30% lower than
than expected 30% to 40%) lower than expected
expected
10 death or above , or 3 deaths above to 10 less than 3 deaths or
50 people serious injury, deaths below , or more above , or less than 10
or direct economy losses than 10 people but less people serious injury, or
when at 5% (including than 50 people serious direct economy losses
5%) above of judging injury, or direct when at 1% below of
standard economy losses when at judging standard
1% (including 1%) to
5% of judging standard
Asset integrity cannot Asset integrity cannot Asset integrity cannot
be ensured, when assets be ensured, when assets be ensured, when assets
losses at 5% (including losses at 1% losses at 1% below of
5%) above of judging (including 1%)to 5% of judging standard
standard judging standard
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China Merchants Port Group Co., Ltd. Annual Report 2020
A large number of great Several commercial Irreconcilable
commercial disputes, disputes, civil lawsuits, commercial disputes,
civil lawsuits and and had obviously civil lawsuits happened
negative influences can't influence in a certain sometimes, cause a
eliminate in a short area and period, may certain influences in
period of time, may pay pay compensation at 1% local, may pay
compensation at 5% (including 1%) to 5% of compensation at 1%
(including 5%) above of judging standard below of judging
judging standard standard
A serious violation of A serious violation of Violation of laws and
laws and regulations, laws and regulations, regulations, investigated
investigated by investigated by by government
government department government department department and legal
and legal department, and legal department, department, may pay
cause prosecution and may pay compensation compensation at
class action, may pay at 0.5% (including 0.5% below of judging
compensation at 2% 0.5%) to 2% of judging standard
(including 2%) above of standard
judging standard
Number of material weaknesses in internal control over financial reporting 0
Number of material weaknesses in internal control not related to financial reporting 0
Number of serious weaknesses in internal control over financial reporting 0
Number of serious weaknesses in internal control not related to financial reporting 0
Note: The percentages of evaluated entities’ combined assets and operating revenue to consolidated
total assets and operating revenue have been deducted the corresponding financial data of the
merged company.
X Independent Auditor’s Report on Internal Control
Opinion paragraph in the independent auditor’s report on internal control
We believe that China Merchants Port Group Co., Ltd. has maintained effective internal control over financial
reporting in all material respects as of 31 December 2020 as per the Basic Rules for Enterprise Internal Control
and relevant regulations.
Independent auditor’s report on internal control
Disclosed
disclosed or not
Disclosure date 31 March 2021
Index to such report disclosed For details, see www.cninfo.com.cn
Type of the auditor’s opinion Unmodified unqualified opinion
Material weaknesses in internal control not related to
None
financial reporting
Indicate by tick mark whether any modified opinion is expressed in the independent auditor’s report
on the Company’s internal control.
□ Yes √ No
Indicate by tick mark whether the independent auditor’s report on the Company’s internal control is
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consistent with the internal control self-evaluation report issued by the Company’s Board.
√ Yes □ No
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China Merchants Port Group Co., Ltd. Annual Report 2020
Part XI Corporate Bonds
Does the Company have any corporate bonds publicly offered on the stock exchange, which were
outstanding before the date of this Report’s approval or were due but could not be redeemed in full?
Yes
I. Basic Information of the Corporate Bonds
Bonds
Release Maturity balance Interest
Name Abbr. Code Way of redemption
date date (RMB’0 rate
,000)
Simple interest is
2020 adopted and
Public calculated by year.
Offering of No compound
Corporate interest is
Bonds of calculated. Interests
China are paid once every
20 CMPort 7 July 8 July 3.36
Merchants 149170 200,000 year and principals
01 2020 2023 %
Port Group paid in lump sum at
Co., Ltd. maturity. In the last
(for installment, the
qualified interests are paid
investors) together with
(Phase I) principal
repayment.
Listed or transferred
trading place of the List on the SZSE.
Company bonds
The Company’s bonds are publicly issued to eligible investors who comply with
Appropriate arrangement the Measures for Issuance and Trading of Corporate Bonds and have opened an
of the investors eligible A-share securities account with Shenzhen Branch of China Securities
Depository and Clearing Co., Ltd. (CSDC).
Interest payment during
During the Reporting Period, “20 CMPort 01” did not enter the payment period.
the Reporting Period
Execution of the relevant
regulations during the
Reporting Period such as
the affiliated option
clause of the issuers or
Not applicable
investors, special clauses
such as the exchangeable
regulations of the
Company bonds (if
applicable)
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China Merchants Port Group Co., Ltd. Annual Report 2020
II. List of the Bond Trustee and the Rating Organization
Bond trustee:
18F CITIC
Securities
Tower,
CITIC No.8 Chen
Office Contact Contact 0755-
Name Securities Zhongxin Tianya and
address person number 23835062
Co., Ltd. 3rd Road, Feng Yuan
Futian
District,
Shenzhen
Rating organization executed the tracking rating of the corporate bonds of the Reporting Period:
China Chengxin International Credit Office 60101, Building 1, No.2 Nanzhugan
Name
Rating Co., Ltd. address hutong, Dongcheng District, Beijing
Alternation reasons, execution
process and influences on the
investors’ interests etc. if there was
alternation of the bond trustees and Not applicable
the credit rating agencies engaged
by the Company during the
Reporting Period (if applicable)
III. List of the Usage of the Raised Funds of the Corporate Bonds
The Company has used the raised funds strictly in accordance with the
terms in the prospectus for current bonds, related provisions and
List of the usage of the raised
requirements in the Measures for Issuance and Trading of Corporate
funds and the execution process of
Bonds and the Bonds Listing Rules of the Shenzhen Stock Exchange. It
the Company bonds
has not engaged in any violations in respect of the use and management
of the raised funds.
Ending balance (RMB’0,000) 0
The Company deposits raised funds in a dedicated account and strictly
Operating situation of the raised
performs internal approval procedures for the use of raised funds to
funds special account
ensure designated use of designated money.
Whether the usage of the raised
funds met with the usage, using
Yes
plan and other agreements
committed on the prospectus
IV. Rating Situation of the Corporate Bonds Information
On 24 June 2020, China Chengxin International Credit Rating Co., Ltd. (CCXI) issued a credit
rating notice (XPWHZ [2019] No. G564). CCXI granted the corporate credit rating of AAA to the
Company with a rating outlook of Stable, and the credit rating of AAA to the “2020 Public Offering
of Corporate Bonds of China Merchants Port Group Co., Ltd. (for qualified investors) (Phase I)”.
During the Reporting Period, there was no rating difference in the corporate credit ratings of other
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China Merchants Port Group Co., Ltd. Annual Report 2020
bonds and debt financing instruments issued by the Company in China.
V. Credit-adding Mechanism, Repayment Plan and Other Repayment Guarantee Measures of
the Corporate Bonds
(I) Changes in the credit enhancement mechanism, debt repayment plans and other debt repayment
guarantee measures
During the Reporting Period, there was no significant change in the credit mechanism, debt
repayment plans and other debt repayment guarantee measures for the Company’s bonds.
(II) Regarding the credit enhancement mechanism
During the Reporting Period, the Company’s bonds had no surety bond, mortgage or pledge and no
other method of credit enhancement.
(III) Debt repayment plans or other debt repayment guarantee measures taken
To fully and effectively safeguard the rights and interests of bond holders, the Company has
developed a series of work plans for the timely and full repayment of its bonds, including
designating dedicated departments and personnel, arranging funds for debt repayment, developing
and strictly executing fund management plans, properly organizing and coordinating, fully exerting
the role of the bond trustee, and strictly performing the information disclosure obligation. These
plans have formed a set of guarantee measures for the safe payment of interests and repayment for
the bonds.
(IV) Dedicated debt repayment account
The Company has set up a dedicated corporate bond account for its bonds. It has signed a tripartite
fund regulation agreement with the trustee and the fund custodian bank to guarantee the full and
timely payment of interests and repayment of principals for its bonds.
VI. Convene Situation of the Bonds Holders Meeting during the Reporting Period
During the Reporting Period, no bonds holders meeting was convened.
VII. List of the Duty Execution of the Bonds Trustee during the Reporting Period
The bond trustee of “20 CMPort 01” is CITIC Securities. As at the issue date of this Report since
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China Merchants Port Group Co., Ltd. Annual Report 2020
the issue of “20 CMPort 01”, the trustee CITIC Securities had performed continuous tracking and
supervision on the Company’s credit status, the use of the funds raised under the Company’s bonds,
and the implementation of the debt repayment guarantee measures strictly in accordance with
relevant laws, regulations and the provisions of the Bond Trusteeship Agreement. It had reminded
the Company to fulfill its obligations specified in the prospectus, proactively performed its duties as
the bond trustee, and safeguarded the legitimate rights and interests of the bond holders.
As at the issue date of this Report, there had been no conflict of interests in the trustee’s
performance of duties. The trustee had yet issued the report on the trusteeship affairs.
VIII. The Major Accounting Data and the Financial Indicators of the Recent 2 Years of the
Company up the Period-end
Unit: RMB’0,000
Item 2020 2019 Increase/decrease
EBITDA 1,176,301.96 1,576,181.91 -25.37%
Current ratio 82.99% 68.44% 14.55%
Debt/asset ratio 37.30% 39.38% -2.08%
Quick ratio 82.27% 68.00% 14.27%
Debt/EBITDA ratio 18.71% 25.54% -6.83%
Interest cover (times) 3.38 5.09 -33.60%
Cash-to-interest cover
4.14 3.95 4.81%
(times)
EBITDA-to-interest cover
5.84 7.42 -21.29%
(times)
Debt repayment ratio (%) 100.00% 100.00% -
Interest payment ratio (%) 100.00% 100.00% -
Main reason of the above accounting data and the financial indicators with the YoY change
exceeded 30%
√ Applicable □ Not applicable
The interest cover (times) declined 33.60% compared with last year mainly due to a decrease in
total profit.
IX. Overdue Debts of the Company
□ Applicable √ Not applicable
No such cases in the Reporting Period.
X. List of the Interest Payment of Other Bonds and Debt Financing Instruments during the
Reporting Period
During the Reporting Period, the Company paid interests in due course for other bonds and debt
financing instruments without any delay or failure in the payment of interests and repayment of
155
China Merchants Port Group Co., Ltd. Annual Report 2020
principals.
XI. List of the Acquired Bank Credit Lines, Usage and the Repayment of the Bank Loans
The Company had maintained good credit records with different banks and other financial
institutions. As at the end of December 2020, the Company had been granted a credit of RMB56.2
billion by banks, of which RMB15.9 billion had been used. During the Reporting Period, the
Company had used the funds strictly according to the banks’ loan requirements and fully repaid
bank loans in due course.
XII. List of the Execution of the Agreements or the Commitments Related to the Company
Bonds Raising Specification during the Reporting Period
The Company had strictly carried out the content specified in the prospectus of its bonds, with no
incident of harming the rights and interests of the bond investors.
XIII. Significant Events Occurring during the Reporting Period
Refer to Part V Significant Events of this Report.
XIV. Whether there was Guarantor of the Corporate Bonds
□ Yes √ No
156
China Merchants Port Group Co., Ltd. Annual Report 2020
Part XII Financial Statements (See attached)
I Independent Auditor’s Report
Type of the independent auditor’s opinion Standard and unqualified auditor's report
Date of signing this report 30 March 2021
Deloitte Touche Tohmatsu Certified Public
Name of the independent auditor
Accountants LLP
Reference number of Audit Report De Shi Bao (Shen) Zi (21) No.P02174
Name of the certified public accountants Li Weihua, Zhang Min
157
China Merchants Port Group Co., Ltd. Annual Report 2020
Part XIII Documents Available for Reference
I. Financial Statements carrying the signatures and stamps of the Company Principal, the
Chief Financial Officer and the person in charge of accounting firm;
II. Original copy of the Auditor's Report stamped by the accounting firm and signed and
stamped by registered accountants;
III. Original copies of all documents and the announcements thereof disclosed in the reporting
period on “Securities Times” and “Ta Kung Pao”.
For and on behalf of the Board
Bai Jingtao
Legal representative of
China Merchants Port Group Co., Ltd.
Dated 31 March 2021
158
CHINA MERCHANTS PORT GROUP CO., LTD.
FINANCIAL STATEMENTS AND AUDITOR'S REPORT
FOR THE YEAR ENDED 31 DECEMBER 2020
CHINA MERCHANTS PORT GROUP CO., LTD.
FINANCIAL STATEMENTS AND AUDITOR'S REPORT
FOR THE YEAR ENDED 31 DECEMBER 2020
CONTENTS Pages
AUDITOR'S REPORT 1-6
THE CONSOLIDATED AND COMPANY'S BALANCE SHEETS 7 - 10
THE CONSOLIDATED AND COMPANY'S INCOME STATEMENTS 11 - 12
THE CONSOLIDATED AND COMPANY'S CASH FLOW STATEMENTS 13 - 14
THE CONSOLIDATED AND COMPANY'S STATEMENTS OF CHANGES IN
SHAREHOLDERS' EQUITY 15 - 18
NOTES TO ITEMS OF THE FINANCIAL STATEMENTS 19 - 176
AUDITOR'S REPORT
De Shi Bao (Shen) Zi (21) No. P02174
(Page 1 of 6)
To all the shareholders of China Merchants Port Group Co., Ltd.,
I. Audit Opinion
We have audited the accompanying financial statements of China Merchants Port Group Co., Ltd. (hereinafter referred to
as "the Company"), which comprise the consolidated and company balance sheets as at 31 December 2020, and the
consolidated and company's income statements, the consolidated and company's cash flow statements and the consolidated
and company's statements of changes in shareholders' equity for the year then ended, and the notes to the financial
statements.
In our opinion, the accompanying financial statements of the Company present fairly, in all material respects, the
consolidated and company's financial position as of 31 December 2020, the consolidated and company's results of
operations and cash flows for the year then ended in accordance with the Accounting Standards for Business Enterprises.
II. Basis for the Opinion
We conducted our audit in accordance with the Auditing Standards for the Chinese Certified Public Accountants. Our
responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial
Statements section of our report. We are independent of the Company in accordance with the Auditing Standards for the
Chinese Certified Public Accountants, and we have fulfilled our other ethical responsibilities in accordance with the
standards. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
III. Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the
financial statements of the current year. These matters were addressed in the context of our audit of the financial statements
as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We determine
the followings are key audit matters that need to be addressed in our report.
1. Subsequent measurement of long-term equity investment in associates and joint ventures
As disclosed in Notes (V) 13 to the consolidated financial statements, on December 31, 2020, the book value of China
Merchants Port Group’s long-term equity investment in associates amounted to RMB 57,371,179,717.36, accounting for
54% of the total shareholder’s equity. In 2020, the investment income from associates recognized by the equity method
amounts to RMB 3,630,921,407.38, accounting for 66% of the consolidated net profit. Since the amount of investment
income recognized by China Merchants Port Group for associates this year is significant, and its correctness depends on the
financial status and operating results of the investee, we determine the above-mentioned subsequent measurement of the
long-term equity investment in associates as a merger key audit matters of financial statements.
-1-
AUDITOR'S REPORT - continued
De Shi Bao (Shen) Zi (21) No. P02174
(Page 2 of 6)
III. Key Audit Matters - continued
1. Subsequent measurement of long-term equity investment in associates and joint ventures -
continued
Principal audit procedures we performed for key audit matters are as follows:
(1) Understood the certified public accountants of major associates/joint ventures and evaluated
their independence and professional competence;
(2) Identified and assessed the risk of material misstatement in the financial statements of the major
associates/joint ventures from the perspective of auditing the consolidated financial statements
of the Company by reading the financial statements of the major associates/joint ventures and
discussing with the management the financial performance of the major associates/joint
ventures and the significant judgments and estimates made in the preparation of the financial
statements;
(3) Discussed with the component certified public accountants of the major associates/joint
ventures their assessment of the component audit risk, the identification of key audit areas and
the implementation of the corresponding audit procedures to evaluate whether the audit of the
component certified public accountants was appropriate;
(4) Evaluated whether the audit evidence obtained by the component certified public accountants
was sufficient and appropriate by reviewing the audit documents of the component certified
public accountants of the major associates/joint ventures when we deemed necessary.
(5) Verified whether the accounting policies and accounting periods adopted by the associates/joint
ventures were consistent with the Company's. If not, checked whether the financial statements
of the associates/joint ventures have been adjusted according to the accounting policies and
accounting period of the Company, and recognized the amount of investment income under
equity method on that basis.
2. Goodwill impairment
As disclosed in Notes (V) 22 to the consolidated financial statements, as at 31 December 2020, the goodwill in the
consolidated financial statements of the Company was RMB 6,675,939,930.13. The management of the Company used the
net amount of fair value less costs of disposal or the present value of the estimated future cash flows to determine the
recoverable amount of the relevant asset group when testing the goodwill for impairment, of which the fair value
assessment is based on the market approach, and the forecast of future cash flows and the calculation of the present value
included key assumptions, such as income growth rate, gross profit margin, discount rate, etc. We identified the goodwill
impairment as a key audit matter of the consolidated financial statements due to the significant amount of goodwill and that
the management needs to make significant judgments and estimates when conducting goodwill impairment testing.
-2-
AUDITOR'S REPORT - continued
De Shi Bao (Shen) Zi (21) No. P02174
(Page 3 of 6)
III. Key Audit Matters - continued
2. Goodwill impairment - continued
Principal audit procedures we performed for key audit matters are as follows:
(1) Assessed reasonability of division of asset group and combination of asset group management made by
management;
(2) Referred to industry practice to assess whether the management's approach in cash flows forecast is appropriate and
whether the assumptions used are reasonable;
(3) Compared the data used in cash flow forecast with historical data and budget data approved by the management,
and assessed the reasonableness of the data used;
(4) Compared the growth rate of the business volume in the forecast period with the growth rate of the historical
business volume and evaluated its appropriateness.
(5) Understood the basis for management to determine the growth rate of the business in the subsequent forecast period
and assessed its appropriateness;
(6) Assessed the appropriateness of the discount rate adopted by the management in combination with market risk-free
interest rates, risk factors, etc.;
(7) Use the work of internal evaluation experts to evaluate the appropriateness of management's assessment method of
the recoverable amount of the asset group, and evaluate the reasonableness of the discount rate used by the
management in predicting the present value of the cash flow and the growth rate of the subsequent forecast period.
(8) Reviewed whether the calculation of the present value of future cash flows was correct.
(9) Reviewed whether the method used to assess the fair value less costs of disposal was appropriate.
(10) Assess the adequacy and appropriateness of the disclosure of the goodwill impairment test.
IV. Other Information
The Company is responsible for the other information. The other information comprises the information included in the
2020 annual report, but does not include the consolidated financial statements and our auditor's report.
Our opinion on the financial statements does not cover the other information and we do not express any form of assurance
conclusion.
-3-
AUDITOR'S REPORT - continued
De Shi Bao (Shen) Zi (21) No. P02174
(Page 4 of 6)
IV. Other Information - continued
In combination with our audit of the financial statements, our responsibility is to read the other information and, in doing
so, consider whether the other information is materially inconsistent with the financial statements or our knowledge
obtained in the audit or otherwise appears to be materially misstated.
If, based on the audit work performed, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.
V. Responsibilities of the Management and Those Charged with Governance for the Financial Statements
The management of the Company is responsible for the preparation of the financial statements that give a true and fair view
in accordance with Accounting Standards for Business Enterprises, and for the design, performance and maintenance of
such internal control that is necessary to enable the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the management is responsible for assessing the Company's ability to continue as a
going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting
unless the management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to
do so.
These charged with governance are responsible for overseeing the Company's financial reporting process.
VI. Auditor's Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements are free from material
misstatement, whether due to fraud or error, and to issue an auditor's report that includes an audit opinion. Reasonable
assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Auditing Standards
for the Chinese Certified Public Accountants will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could expected influence
the economic decisions taken based on these financial statements by reasonable users.
As part of an audit in accordance with Auditing Standards for the Chinese Certified Public Accountants, we exercise
professional judgment and maintain professional skepticism throughout the audit. We also:
-4-
AUDITOR'S REPORT - continued
De Shi Bao (Shen) Zi (21) No. P02174
(Page 5 of 6)
VI. Auditor's Responsibilities for the Audit of the Financial Statements - continued
(1) Identified and assessed the risks of material misstatement of the financial statements, whether due to fraud or error,
designed and performed audit procedures responsive to those risks, and obtained audit evidence that was sufficient
and appropriate to form our opinion. The risk of not detecting a material misstatement resulting from fraud was
higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
(2) Understood audit-related internal control in order to design audit procedures that were appropriate in the
circumstances.
(3) Evaluated the appropriateness of accounting policies applied and the reasonableness of accounting estimates and
related disclosures made by the management.
(4) Concluded on the appropriateness of the directors' application of the going concern basis of accounting. Based on
audit evidence obtained, concluded on whether the material uncertainty of events or conditions that may cause cast
significant doubt on the Company's ability to continue as a going concern existed. If we concluded that a material
uncertainty existed, we were required to draw attention in our auditor's report to the related disclosures in the
financial statements or to modify our opinion, if such disclosures were inadequate. Our conclusions were based on
the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause
the Company to cease to continue as a going concern.
(5) Evaluated the overall presentation (including the disclosures), structure and content of the financial statements, and
whether the financial statements represented the underlying transactions and events in a manner that achieved fair
presentation.
(6) Obtained sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Company to express an opinion on the financial statements. We were responsible for the
direction, supervision and performance of the group audit. We remained solely responsible for our audit opinion.
We communicated with those charged with governance over audit scope, time arrangement and significant audit findings,
including any significant deficiencies of internal control that we identified through audit.
We also provided those charged with governance with a statement that we had complied with relevant ethical requirements
of independence, and communicated with those charged with governance over all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, related safeguards.
-5-
AUDITOR'S REPORT - continued
De Shi Bao (Shen) Zi (21) No. P02174
(Page 6 of 6)
VI. Auditor's Responsibilities for the Audit of the Financial Statements - continued
From the matters communicated with those charged with governance, we determined those matters that were of most
significance in the audit of the financial statements of the current year and were therefore the key audit matters. We
described these matters in our auditor's report unless law or regulation precluded public disclosure about the matter or
when, in extremely rare circumstances, we determined that a matter should not be addressed in our report because the
adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such
communication.
Deloitte Touche Tohmatsu CPA LLP Chinese Certified Public Accountant
(Engagement Partner)
Shanghai, China
Li Weihua
Chinese Certified Public Accountant
Zhang Min
30 March 2021
The auditor’s report and the accompanying financial statements are English translations of the Chinese auditor’s report
and statutory financial statements prepared under accounting principles and practices generally accepted in the People’s
Republic of China. These financial statements are not intended to present the financial position and results of operations
and cash flows in accordance with accounting principles and practices generally accepted in other countries and
jurisdictions. In case the English version does not conform to the Chinese version, the Chinese version prevails.
-6-
CHINA MERCHANTS PORT GROUP CO., LTD.
AT 31 DECEMBER 2020
Consolidated Balance Sheet
RMB
Item Notes Closing balance Opening balance
Current Assets:
Cash and bank balances (V) 1 11,791,424,734.63 7,734,948,210.26
Held-for-trading financial assets (V) 2 850,165,448.59 -
Notes receivable (V) 3 3,891,994.84 38,192,250.02
Accounts receivable (V) 4 1,372,650,236.16 1,356,460,129.90
Receivables financing (V) 5 217,449,966.41 260,760,537.45
Prepayments (V) 6 49,220,850.11 55,034,019.81
Other receivables (V) 7 3,557,195,461.26 2,129,378,252.50
Inventories (V) 8 211,366,458.88 163,980,192.08
Assets held for sale (V) 9 337,442,757.28 188,404,228.34
Non-current assets due within one year (V) 10 67,692,473.44 808,893,013.06
Other current assets (V) 11 433,666,201.42 2,298,792,661.70
Total current assets 18,892,166,583.02 15,034,843,495.12
Non-current Assets:
Long-term receivables (V) 12 3,887,949,993.10 1,098,831,799.90
Long-term equity investments (V) 13 66,231,923,423.45 57,916,539,383.26
Investments in other equity instruments (V) 14 181,467,057.74 163,561,272.00
Other non-current financial assets (V) 15 910,807,452.56 2,385,363,537.39
Investment properties (V) 16 5,558,755,275.21 5,760,262,674.40
Fixed assets (V) 17 29,471,583,624.56 27,519,962,529.29
Construction in progress (V) 18 5,381,430,606.18 6,334,141,441.88
Right-of-use assets (V) 19 9,087,215,717.60 9,633,325,390.46
Intangible assets (V) 20 18,766,092,163.81 19,693,715,554.10
Development expenditure (V) 21 64,237,735.23 37,399,092.28
Goodwill (V) 22 6,675,939,930.13 8,023,659,694.81
Long-term prepaid expenses (V) 23 874,842,472.68 711,911,011.67
Deferred tax assets (V) 24 420,731,058.30 300,435,502.27
Other non-current assets (V) 25 2,138,468,683.64 2,082,965,467.04
Total non-current assets 149,651,445,194.19 141,662,074,350.75
TOTAL ASSETS 168,543,611,777.21 156,696,917,845.87
-7-
CHINA MERCHANTS PORT GROUP CO., LTD.
AT 31 DECEMBER 2020
Consolidated Balance Sheet - continued
RMB
Item Notes Closing balance Opening balance
Current liabilities:
Short-term borrowings (V) 26 10,483,775,548.93 9,439,099,793.47
Notes payable (V) 27 7,081,772.32 76,455,949.01
Accounts payable (V) 28 599,112,028.98 591,112,466.39
Receipts in advance (V) 29 39,510,127.90 28,826,687.37
Contract liabilities (V) 30 148,044,541.70 85,831,002.52
Employee benefits payable (V) 31 712,085,622.15 634,718,784.64
Taxes payable (V) 32 2,368,662,556.37 1,898,076,342.74
Other payables (V) 33 2,456,700,897.60 2,223,754,677.96
Non-current liabilities due within one year (V) 34 3,564,465,137.37 6,104,339,856.79
Other current liabilities (V) 35 2,383,668,985.94 885,956,581.63
Total current liabilities 22,763,107,219.26 21,968,172,142.52
Non-current Liabilities:
Long-term borrowings (V) 36 7,406,322,693.80 6,313,735,540.33
Bonds payable (V) 37 21,090,545,845.56 20,930,681,967.19
Including: Preferred shares - -
Perpetual bonds - -
Lease liabilities (V) 38 1,327,423,748.05 1,647,129,968.61
Long-term payables (V) 39 1,228,461,573.69 1,935,245,003.21
Long-term employee benefits payable (V) 40 507,714,699.46 471,482,138.63
Provisions (V) 41 100,406,745.66 76,242,559.95
Deferred income (V) 42 1,112,887,683.90 1,147,752,857.17
Deferred tax liabilities (V) 24 4,347,553,142.73 3,961,752,749.17
Other non-current liabilities (V) 43 2,982,220,894.03 3,254,515,306.85
Total non-current liabilities 40,103,537,026.88 39,738,538,091.11
TOTAL LIABILITIES 62,866,644,246.14 61,706,710,233.63
Shareholders' equity:
Share capital (V) 44 1,922,365,124.00 1,922,365,124.00
Capital reserve (V) 45 22,805,069,335.49 22,296,485,467.35
Other comprehensive income (V) 46 -826,697,303.06 -355,944,565.91
Special reserve (V) 47 10,201,178.30 12,386,734.70
Surplus reserve (V) 48 890,690,322.28 630,345,307.43
Unappropriated profit (V) 49 12,316,177,395.17 11,467,166,351.85
Total shareholders' equity attributable to shareholders
37,117,806,052.18 35,972,804,419.42
of the parent
Minority interests 68,559,161,478.89 59,017,403,192.82
TOTAL SHAREHOLDERS' EQUITY 105,676,967,531.07 94,990,207,612.24
TOTAL LIABILITIES AND
168,543,611,777.21 156,696,917,845.87
SHAREHOLDERS' EQUITY
The accompanying notes form part of the financial statements.
The financial statements on pages 7 to 176 were signed by the following:
Bai Jingtao Lu Yongxin Sun Ligan
____________________ ____________________ ____________________
Legal Representative Chief Financial Officer Head of Accounting Department
-8-
CHINA MERCHANTS PORT GROUP CO., LTD.
AT 31 DECEMBER 2020
Balance Sheet of the Company
RMB
Item Notes Closing balance Opening balance
Current Assets:
Cash and bank balances 753,590,556.77 690,685,211.42
Held-for-trading financial assets 800,000,000.00 -
Prepayments 32,236.27 -
Other receivables (XV) 1 1,102,712,752.04 805,534,763.27
Other current assets 2,574,148.83 1,107,292,458.33
Total current assets 2,658,909,693.91 2,603,512,433.02
Non-current Assets:
Long-term receivables 8,667,950.38 61,004,284.75
Long-term equity investments (XV) 2 37,236,798,123.55 30,266,376,582.23
Investments in other equity instruments 155,610,830.00 155,688,635.00
Other non-current financial assets - -
Fixed assets 748,147.75 672,842.27
Construction in progress 3,502,416.12 5,803,169.37
Intangible assets 56,760,723.98 54,692,581.18
Long-term prepaid expenses 1,572,660.89 -
Deferred tax assets 1,846,793.34 928,465.21
Total non-current assets 37,465,507,646.01 30,545,166,560.01
TOTAL ASSETS 40,124,417,339.92 33,148,678,993.03
-9-
CHINA MERCHANTS PORT GROUP CO., LTD.
AT 31 DECEMBER 2020
Balance Sheet of the Company - continued
RMB
Item Notes Closing balance Opening balance
Current Liabilities:
Short-term borrowings 2,174,486,432.93 300,378,812.50
Employee benefits payable 27,085,844.52 6,000,000.00
Taxes payable 208,459,425.46 209,282,889.78
Other payables 460,457,238.16 628,013,119.77
Non-current liabilities due within one year 33,040,000.00 35,832,000.00
Other current liabilities 2,224,519,555.57 715,766,708.20
Total current liabilities 5,128,048,496.64 1,895,273,530.25
Non-current Liabilities:
Bonds payable 2,000,000,000.00 -
Deferred tax liabilities 43,419,526.51 35,164,858.75
Total non-current liabilities 2,043,419,526.51 35,164,858.75
TOTAL LIABILITIES 7,171,468,023.15 1,930,438,389.00
SHAREHOLDERS' EQUITY
Share capital 1,922,365,124.00 1,922,365,124.00
Capital reserve 27,591,847,402.73 27,576,242,527.73
Other comprehensive income 105,536,222.50 105,594,576.25
Surplus reserve 890,690,322.28 630,345,307.43
Unappropriated profit 2,442,510,245.26 983,693,068.62
TOTAL SHAREHOLDERS' EQUITY 32,952,949,316.77 31,218,240,604.03
TOTAL LIABILITIES AND SHAREHOLDERS'
40,124,417,339.92 33,148,678,993.03
EQUITY
The accompanying notes form part of the financial statements.
- 10 -
CHINA MERCHANTS PORT GROUP CO., LTD.
FOR THE YEAR ENDED 31 DECEMBER 2020
Consolidated Income Statement
RMB
Amount incurred Amount incurred
Item Notes in the current in the prior
period period
I. Operating income (V) 50 12,618,529,996.02 12,123,829,423.74
Less: Operating costs (V) 50 7,873,749,854.85 7,648,920,919.71
Taxes and surcharges (V) 51 151,196,943.57 172,556,579.92
Administrative expenses (V) 52 1,584,882,935.02 1,509,520,581.66
Research and development expenses 156,024,113.54 123,853,344.29
Financial expenses (V) 53 1,232,729,624.82 1,936,269,737.53
Including: Interest expense 1,949,882,376.69 2,089,837,594.54
Interest income 325,387,744.56 252,060,018.58
Add: Other income (V) 54 204,965,113.28 162,101,113.10
Investment income (V) 55 4,905,975,438.22 4,619,173,755.42
Including: Income from investments in associates and joint
(V) 55 3,988,916,963.08 3,727,850,763.22
ventures
Gains from changes in fair value (Loss is marked with "-" ) (V) 56 -411,508,773.58 66,483,266.48
Gains from impairment of credit (Loss is marked with "-" ) (V) 57 -458,595,661.31 -50,249,409.77
Gains from impairment of assets (Loss is marked with "-" ) (V) 58 -551,370,042.53 25,051.16
Gains on disposal of assets (Loss is marked with "-" ) (V) 59 1,489,206,502.32 4,794,562,782.79
II. Operating profit 6,798,619,100.62 10,324,804,819.81
Add: Non-operating income (V) 60 81,639,060.54 553,103,360.41
Less: Non-operating expenses (V) 61 79,003,740.77 70,452,012.40
III. Gross profit 6,801,254,420.39 10,807,456,167.82
Less: Income tax expenses (V) 62 1,275,686,369.83 2,640,538,894.62
IV. Net profit 5,525,568,050.56 8,166,917,273.20
(I) Categorization by continuity of operation
1. Net profit from continuing operation 5,525,568,050.56 8,166,917,273.20
2. Net profit from discontinued operation - -
(II) Categorization by attribution of ownership
1. Net profit attributable to shareholders of the parent 2,065,322,969.66 2,898,192,168.84
2. Profit or loss attributable to minority shareholders 3,460,245,080.90 5,268,725,104.36
V. Other comprehensive income, net of tax (V) 64 -1,849,656,940.86 -1,096,285,894.51
Other comprehensive income attributable to owners of the parent, net of tax -470,752,737.15 -443,076,984.15
(I) Other comprehensive income that will not be reclassified to profit or loss -1,552,867.01 9,090,184.52
1. Changes from remeasurement of the defined benefit plan 10,248,546.35 1,069,722.83
2. Other comprehensive income that cannot be reclassified to profit or loss
-11,817,008.06 4,830,921.62
under the equity method
3. Fair value changes of investments in other equity instruments 15,594.70 3,189,540.07
(II) Other comprehensive income that will be reclassified subsequently to
-469,199,870.14 -452,167,168.67
profit or loss
1. Other comprehensive income that can be reclassified to profit or loss
90,675,445.06 -59,050,164.54
under the equity method
2. Translation differences of financial statements denominated in foreign
-559,875,315.20 -393,117,004.13
currencies
Other comprehensive income attributable to minority interests, net of tax -1,378,904,203.71 -653,208,910.36
VI. Total comprehensive income attributable to: 3,675,911,109.70 7,070,631,378.69
Shareholders of the parent 1,594,570,232.51 2,455,115,184.69
Minority shareholders 2,081,340,877.19 4,615,516,194.00
VII. Earnings per share
(I) Basic earnings per share 1.07 1.59
(II) Diluted earnings per share 1.07 1.59
The accompanying notes form part of the financial statements.
- 11 -
CHINA MERCHANTS PORT GROUP CO., LTD.
FOR THE YEAR ENDED 31 DECEMBER 2020
Income Statement of the Company
RMB
Amount incurred Amount incurred
Item Notes in the current in the prior
period period
I. Operating income (XV) 3 6,653,002.66 92,042,598.05
Less: Operating costs (XV) 3 2,265,959.64 76,084,023.73
Taxes and surcharges 2,520,271.63 1,839,217.71
Administrative expenses 133,748,040.20 60,487,851.03
Financial expenses 59,313,221.11 41,936,976.49
Including: Interest expense 87,576,683.75 42,810,942.02
Interest income 38,511,845.95 15,909,363.66
Add: Other income 355,292.70 955,987.32
Investment income (XV) 4 2,975,643,847.56 1,306,222,961.66
Including: Income from investments in associates and joint
(XV) 4 57,647,049.81 70,092,131.84
ventures
Gains (losses) from changes in fair value 33,096,476.05 -
II. Operating profit 2,817,901,126.39 1,218,873,478.07
Add: Non-operating income 5,001.83 57,049.23
Less: Non-operating expenses - 81,092.18
III. Gross profit 2,817,906,128.22 1,218,849,435.12
Less: Income tax expenses 214,455,979.69 187,155,447.57
IV. Net profit 2,603,450,148.53 1,031,693,987.55
V. Other comprehensive income, net of tax -58,353.75 2,956,451.25
(I) Other comprehensive income that cannot be reclassified to profit or loss -58,353.75 2,956,451.25
1. Changes from remeasurement of the defined benefit plan - -
2. Other comprehensive income that cannot be reclassified to profit or loss
- -
under the equity method
3. Fair value changes of investments in other equity instruments -58,353.75 2,956,451.25
(II) Other comprehensive income that will be reclassified to profit or loss - -
1. Other comprehensive income that can be reclassified to profit or loss
- -
under the equity method
2. Translation differences of financial statements denominated in foreign
- -
currencies
VI. Total comprehensive income 2,603,391,794.78 1,034,650,438.80
The accompanying notes form part of the financial statements.
- 12 -
CHINA MERCHANTS PORT GROUP CO., LTD.
FOR THE YEAR ENDED 31 DECEMBER 2020
Consolidated Cash Flow Statement
RMB
Amount incurred in Amount incurred in
Item Notes
the current period the prior period
I. Cash Flows from Operating Activities:
Cash receipts from sales of goods and rendering of services 12,701,740,372.72 12,294,529,982.73
Receipts of tax refunds 42,485,481.75 23,569,265.92
Other cash receipts relating to operating activities (V) 65(1) 815,916,787.26 1,165,710,845.18
Sub-total of cash inflows 13,560,142,641.73 13,483,810,093.83
Cash payments for goods purchased and services received 3,470,983,798.59 3,593,786,248.69
Cash payments to and on behalf of employees 2,778,912,137.24 2,621,068,087.09
Payments of various types of taxes 1,062,476,005.92 957,382,790.97
Other cash payments relating to operating activities (V) 65(2) 751,969,782.97 809,699,551.14
Sub-total of cash outflows 8,064,341,724.72 7,981,936,677.89
Net Cash Flows from Operating Activities (V) 66(1) 5,495,800,917.01 5,501,873,415.94
II. Cash Flows from Investing Activities:
Cash receipts from disposals and recovery of investments 9,137,020,345.82 -
Cash receipts from investments income 1,551,111,503.37 1,804,725,809.65
Net cash receipts from disposal of fixed assets, intangible assets
389,937,931.20 6,274,482,747.66
and other long-term assets
Net cash receipts from disposal of subsidiaries and other
- 1,000,000.00
operating units
Other cash receipts relating to investing activities (V) 65(3) 1,453,513,215.71 3,535,967,030.93
Sub-total of cash inflows 12,531,582,996.10 11,616,175,588.24
Cash payments to acquire or construct fixed assets, intangible
2,728,598,026.38 3,515,540,735.97
assets and other long-term assets
Cash payments to acquire investments 13,686,331,715.60 7,898,674,384.09
Net cash payments for acquisitions of subsidiaries and other
(V) 65(4) - -
business units
Other cash payments relating to investing activities (V) 65(5) 3,009,770,350.62 2,138,951,129.78
Sub-total of cash outflows 19,424,700,092.60 13,553,166,249.84
Net Cash Flows from Investing Activities -6,893,117,096.50 -1,936,990,661.60
III. Cash Flows from Financing Activities:
Cash receipts from capital contributions 5,347,041,408.13 2,213,530,171.90
Including: Cash receipts from capital contributions from
5,347,041,408.13 27,255,000.00
Minority shareholder of subsidiary
Cash receipts from borrowings 24,095,846,198.30 14,306,287,000.87
Cash receipts from issue of bonds 6,197,833,243.33 -
Other cash receipts relating to financing activities (V) 65(6) 1,937,954,936.36 1,713,327,483.01
Sub-total of cash inflows 37,578,675,786.12 18,233,144,655.78
Cash repayments of borrowings 26,923,924,070.90 15,402,220,794.12
Cash payments for distribution of dividends or profits or
4,417,717,782.78 4,022,043,402.10
settlement of interest expenses
Including: Payments for distribution of dividends or profits to
1,586,039,122.85 1,745,724,195.29
Minority shareholder of subsidiary
Other cash payments relating to financing activities (V) 65(7) 842,561,469.96 42,583,797.55
Sub-total of cash outflows 32,184,203,323.64 19,466,847,993.77
Net Cash Flows from Financing Activities 5,394,472,462.48 -1,233,703,337.99
IV. Effect of Foreign Exchange Rate Changes on Cash and
60,305,024.35 9,697,074.77
Cash Equivalents
V. Net Increase in Cash and Cash Equivalents 4,057,461,307.34 2,340,876,491.12
Add: Opening balance of Cash and Cash Equivalents (V) 66(2) 7,714,157,995.87 5,373,281,504.75
VI. Closing Balance of Cash and Cash Equivalents (V) 66(2) 11,771,619,303.21 7,714,157,995.87
The accompanying notes form part of the financial statements.
- 13 -
CHINA MERCHANTS PORT GROUP CO., LTD.
FOR THE YEAR ENDED 31 DECEMBER 2020
Cash Flow Statement of the Company
RMB
Amount incurred in Amount incurred in
Item Notes
the current period the prior period
I. Cash Flows from Operating Activities:
Cash receipts from sales of goods and rendering of 104,722,961.87
-
services
Other cash receipts relating to operating activities 88,581,495.56 246,055,628.30
Sub-total of cash inflows 88,581,495.56 350,778,590.17
Cash payments for goods purchased and services received - 36,211,750.68
Cash payments to and on behalf of employees 56,294,477.30 85,120,511.18
Payments of various types of taxes 211,434,912.21 20,158,391.66
Other cash payments relating to operating activities 61,598,017.83 53,795,218.14
Sub-total of cash outflows 329,327,407.34 195,285,871.66
Net Cash Flows from Operating Activities -240,745,911.78 155,492,718.51
II. Cash Flows from Investing Activities:
Cash receipts from disposals and recovery of investments 2,950,000,000.00 -
Cash receipts from investment income 1,530,980,750.04 57,727,526.33
Other cash receipts relating to investing activities 297,303,477.07 612,722,414.48
Sub-total of cash inflows 4,778,284,227.11 670,449,940.81
Cash payments to acquire or construct fixed assets, 8,035,563.48
1,526,872.01
intangible assets and other long-term assets
Cash payments to acquire investments 5,567,604,695.27 8,000,000.00
Net cash payments for acquisitions of subsidiaries and other 386,159,390.00
3,006,793,109.07
business units
Other cash payments relating to investing activities 436,450,231.63 2,060,171,330.96
Sub-total of cash outflows 9,012,374,907.98 2,462,366,284.44
Net Cash Flows from Investing Activities -4,234,090,680.87 -1,791,916,343.63
III. Cash Flows from Financing Activities:
Cash receipts from capital contributions - 2,186,275,171.90
Cash receipts from borrowings 2,372,563,339.18 2,160,000,000.00
Cash receipts from issue of bonds 6,197,833,243.33 -
Other cash receipts relating to financing activities 544,400,000.00 -
Sub-total of cash inflows 9,114,796,582.51 4,346,275,171.90
Cash repayments of borrowings 3,233,786,000.00 2,167,116,843.58
Cash payments for distribution of dividends or profits or 239,800,502.62
905,286,543.64
settlement of interest expenses
Other cash payments relating to financing activities 437,554,375.82 1,593,549.44
Sub-total of cash outflows 4,576,626,919.46 2,408,510,895.64
Net Cash Flows from Financing Activities 4,538,169,663.05 1,937,764,276.26
IV. Effect of Foreign Exchange Rate Changes on Cash and -497,294.65
-427,725.05
Cash Equivalents
V. Net Increase in Cash and Cash Equivalents 62,905,345.35 300,843,356.49
Add: Opening Balance of Cash and Cash Equivalents 690,685,211.42 389,841,854.93
VI. Closing Balance of Cash and Cash Equivalents 753,590,556.77 690,685,211.42
The accompanying notes form part of the financial statements.
- 14 -
CHINA MERCHANTS PORT GROUP CO., LTD.
FOR THE YEAR ENDED 31 DECEMBER 2020
Consolidated Statement of Changes in Shareholders' Equity
RMB
2020
Equity attributable to shareholders of the parent
Item Other Total shareholders'
Minority interests
Share capital Capital reserve comprehensive Unappropriated equity
income Special reserve Surplus reserve profit
I. Closing balance of the preceding year 1,922,365,124.00 22,296,485,467.35 -355,944,565.91 12,386,734.70 630,345,307.43 11,467,166,351.85 59,017,403,192.82 94,990,207,612.24
Add: Changes in accounting policies - - - - - - - -
Corrections of prior period errors - - - - - - - -
Business combination involving
- - - - - - - -
enterprises under common control
Others - - - - - - - -
II. Opening balance of the year 1,922,365,124.00 22,296,485,467.35 -355,944,565.91 12,386,734.70 630,345,307.43 11,467,166,351.85 59,017,403,192.82 94,990,207,612.24
III. Changes for the year - 508,583,868.14 -470,752,737.15 -2,185,556.40 260,345,014.85 849,011,043.32 9,541,758,286.07 10,686,759,918.83
(I) Total comprehensive income - - -470,752,737.15 - - 2,065,322,969.66 2,081,340,877.19 3,675,911,109.70
(II) Owners' contributions and reduction in
- 508,583,868.14 - - - - 9,813,153,124.68 10,321,736,992.82
capital
1. Ordinary shares contributed by
- - - - - - - -
shareholders
2. Capital contribution from holders of
- - - - - - 5,347,041,408.13 5,347,041,408.13
other equity instruments
3. Share-based payment recognized in
- 10,096,607.62 - - - - 9,116,783.96 19,213,391.58
shareholders' equity
4. Others - 498,487,260.52 - - - - 4,456,994,932.59 4,955,482,193.11
(III) Profit distribution - - - - 260,345,014.85 -1,217,861,842.98 -2,342,313,102.40 -3,299,829,930.53
1. Transfer to surplus reserve - - - - 260,345,014.85 -260,345,014.85 - -
2. Transfer to general risk reserve - - - - - - - -
3. Distributions to shareholders - - - - - -884,287,957.04 -2,241,431,859.76 -3,125,719,816.80
4. Others - - - - - -73,228,871.09 -100,881,242.64 -174,110,113.73
(IV) Transfers within shareholders' equity - - - -1,549,916.64 - 1,549,916.64 - -
1. Capitalization of capital reserve - - - - - - - -
2. Capitalization of surplus reserve - - - - - - - -
3. Loss offset by surplus reserve - - - - - - - -
4. Others - - - -1,549,916.64 - 1,549,916.64 - -
(V) Special reserve - - - -635,639.76 - - -10,422,613.40 -11,058,253.16
1. Transfer to special reserve in the
- - - 57,538,524.86 - - 49,446,114.15 106,984,639.01
period
2. Amount utilized in the period - - - -58,174,164.62 - - -59,868,727.55 -118,042,892.17
(VI) Others - - - - - - - -
IV. Closing balance of the year 1,922,365,124.00 22,805,069,335.49 -826,697,303.06 10,201,178.30 890,690,322.28 12,316,177,395.17 68,559,161,478.89 105,676,967,531.07
- 15 -
CHINA MERCHANTS PORT GROUP CO., LTD.
FOR THE YEAR ENDED 31 DECEMBER 2020
Consolidated Statement of Changes in Shareholders' Equity - continued
RMB
2019
Equity attributable to shareholders of the parent
Item Other Total shareholders'
Minority interests
Share capital Capital reserve comprehensive Unappropriated equity
income Special reserve Surplus reserve profit
I. Closing balance of the preceding year 1,793,412,378.00 19,426,912,957.05 88,925,978.57 8,231,080.43 527,175,908.67 8,915,817,110.21 49,656,450,459.88 80,416,925,872.81
Add: Changes in accounting policies - - - - - -41,018,077.68 -80,367,183.77 -121,385,261.45
Corrections of prior period errors - - - - - - - -
Business combination involving
- - - - - - - -
enterprises under common control
Others - - - - - - - -
II. Opening balance of the year 1,793,412,378.00 19,426,912,957.05 88,925,978.57 8,231,080.43 527,175,908.67 8,874,799,032.53 49,576,083,276.11 80,295,540,611.36
III. Changes for the year 128,952,746.00 2,869,572,510.30 -444,870,544.48 4,155,654.27 103,169,398.76 2,592,367,319.32 9,441,319,916.71 14,694,667,000.88
(I) Total comprehensive income - - -443,076,984.15 - - 2,898,192,168.84 4,615,516,194.00 7,070,631,378.69
(II) Owners' contributions and reduction in
128,952,746.00 2,869,572,510.30 - - - - 6,867,048,857.78 9,865,574,114.08
capital
1. Ordinary shares contributed by
128,952,746.00 2,058,595,347.69 - - - - 27,255,000.00 2,214,803,093.69
shareholders
2. Capital contribution from holders of
- - - - - - - -
other equity instruments
3. Share-based payment recognized in
- - - - - - - -
shareholders' equity
4. Others - 810,977,162.61 - - - - 6,839,793,857.78 7,650,771,020.39
(III) Profit distribution - - - - 103,169,398.76 -307,618,409.85 -2,040,721,489.06 -2,245,170,500.15
1. Transfer to surplus reserve - - - - 103,169,398.76 -103,169,398.76 - -
2. Transfer to general risk reserve - - - - - - - -
3. Distributions to shareholders - - - - - -204,449,011.09 -2,040,721,489.06 -2,245,170,500.15
4. Others - - - - - - - -
(IV) Transfers within shareholders' equity - - -1,793,560.33 - - 1,793,560.33 - -
1. Capitalization of capital reserve - - - - - - - -
2. Capitalization of surplus reserve - - - - - - - -
3. Loss offset by surplus reserve - - - - - - - -
4. Others - - -1,793,560.33 - - 1,793,560.33 - -
(V) Special reserve - - - 4,155,654.27 - - -523,646.01 3,632,008.26
1. Transfer to special reserve in the
- - - 108,062,435.41 - - 115,436,394.98 223,498,830.39
period
2. Amount utilized in the period - - - -103,906,781.14 - - -115,960,040.99 -219,866,822.13
(VI) Others - - - - - - - -
IV. Closing balance of the year 1,922,365,124.00 22,296,485,467.35 -355,944,565.91 12,386,734.70 630,345,307.43 11,467,166,351.85 59,017,403,192.82 94,990,207,612.24
The accompanying notes form part of the financial statements.
- 16 -
CHINA MERCHANTS PORT GROUP CO., LTD.
FOR THE YEAR ENDED 31 DECEMBER 2020
Statement of Changes in Shareholders' Equity of the Company
RMB
2020
Item Other comprehensive Total shareholders'
Share capital Capital reserve income Special reserve Surplus reserve Unappropriated profit equity
I. Closing balance of the preceding year 1,922,365,124.00 27,576,242,527.73 105,594,576.25 - 630,345,307.43 983,693,068.62 31,218,240,604.03
Add: Changes in accounting policies - - - - - - -
Corrections of prior period errors - - - - - - -
Others - - - - - - -
II. Opening balance of the year 1,922,365,124.00 27,576,242,527.73 105,594,576.25 - 630,345,307.43 983,693,068.62 31,218,240,604.03
III. Changes for the year - 15,604,875.00 -58,353.75 - 260,345,014.85 1,458,817,176.64 1,734,708,712.74
(I) Total comprehensive income - - -58,353.75 - - 2,603,450,148.53 2,603,391,794.78
(II) Owners' contributions and reduction in
- 15,604,875.00 - - - - 15,604,875.00
capital
1. Ordinary shares contributed by
- - - - - - -
shareholders
2. Share-based payment recognized in
- 15,604,875.00 - - - - 15,604,875.00
shareholders' equity
3. Others - - - - - - -
(III) Profit distribution - - - - 260,345,014.85 -1,144,632,971.89 -884,287,957.04
1. Transfer to surplus reserve - - - - 260,345,014.85 -260,345,014.85 -
2. Transfer to general risk reserve - - - - - - -
3. Distributions to shareholders - - - - - -884,287,957.04 -884,287,957.04
4. Others - - - - - - -
(IV) Transfers within shareholders' equity - - - - - - -
1. Capitalization of capital reserve - - - - - - -
2. Capitalization of surplus reserve - - - - - - -
3. Loss offset by surplus reserve - - - - - - -
4. Others - - - - - - -
(V) Special reserve - - - - - - -
1. Transfer to special reserve in the period - - - - - - -
2. Amount utilized in the period - - - - - - -
(VI) Others - - - - - - -
IV. Closing balance of the year 1,922,365,124.00 27,591,847,402.73 105,536,222.50 - 890,690,322.28 2,442,510,245.26 32,952,949,316.77
- 17 -
CHINA MERCHANTS PORT GROUP CO., LTD.
FOR THE YEAR ENDED 31 DECEMBER 2020
Statement of Changes in Shareholders' Equity of the Company - continued
RMB
2019
Item Other comprehensive Total shareholders'
Share capital Capital reserve income Special reserve Surplus reserve Unappropriated profit equity
I. Closing balance of the preceding year 1,793,412,378.00 25,517,647,180.04 102,638,125.00 470,465.59 527,175,908.67 259,943,085.16 28,201,287,142.46
Add: Changes in accounting policies - - - - - -325,594.24 -325,594.24
Corrections of prior period errors - - - - - - -
Others - - - - - - -
II. Opening balance of the year 1,793,412,378.00 25,517,647,180.04 102,638,125.00 470,465.59 527,175,908.67 259,617,490.92 28,200,961,548.22
III. Changes for the year 128,952,746.00 2,058,595,347.69 2,956,451.25 -470,465.59 103,169,398.76 724,075,577.70 3,017,279,055.81
(I) Total comprehensive income - - 2,956,451.25 - - 1,031,693,987.55 1,034,650,438.80
(II) Owners' contributions and reduction in
128,952,746.00 2,058,595,347.69 - - - - 2,187,548,093.69
capital
1. Ordinary shares contributed by
128,952,746.00 2,058,595,347.69 - - - - 2,187,548,093.69
shareholders
2. Share-based payment recognized in
- - - - - - -
shareholders' equity
3. Others - - - - - - -
(III) Profit distribution - - - - 103,169,398.76 -307,618,409.85 -204,449,011.09
1. Transfer to surplus reserve - - - - 103,169,398.76 -103,169,398.76 -
2. Transfer to general risk reserve - - - - - - -
3. Distributions to shareholders - - - - - -204,449,011.09 -204,449,011.09
4. Others - - - - - - -
(IV) Transfers within shareholders' equity - - - - - - -
1. Capitalization of capital reserve - - - - - - -
2. Capitalization of surplus reserve - - - - - - -
3. Loss offset by surplus reserve - - - - - - -
4. Others - - - - - - -
(V) Special reserve - - - -470,465.59 - - -470,465.59
1. Transfer to special reserve in the period - - - 919,167.67 - - 919,167.67
2. Amount utilized in the period - - - -1,389,633.26 - - -1,389,633.26
(VI) Others - - - - - - -
IV. Closing balance of the year 1,922,365,124.00 27,576,242,527.73 105,594,576.25 - 630,345,307.43 983,693,068.62 31,218,240,604.03
The accompanying notes form part of the financial statements.
- 18 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(I) GENERAL INFORMATION OF THE COMPANY
China Merchants Port Group Company Limited was a stock limited company incorporated in Shenzhen, Guangdong
Province, on 16 January 1993.
The headquarters of the Company is located in Shenzhen, Guangdong Province. The Company and its subsidiaries
(collectively the "Group") are principally engaged in the rendering of port service, bonded logistics service and other
businesses such as property development and investment.
The Company's and consolidated financial statements have been approved by the Board of Directors on 29 March
2021.
See Notes (VII) "Equity in Other Entities" for details of the scope of consolidated financial statements in the current
year. See Note (VI) "Changes in Scope of Consolidation" for details of changes in the scope of consolidated financial
statements in the current period.
(II) BASIS OF PREPARATION OF FINANCIAL STATEMENTS
Basis of preparation of financial statements
The Group has adopted the Accounting Standards for Business Enterprises ("ASBE") issued by the Ministry of
Finance ("MoF"). In addition, the Group has disclosed relevant financial information in accordance with Information
Disclosure and Presentation Rules for Companies Offering Securities to the Public No. 15 - General Provisions on
Financial Reporting (Revised in 2014).
Going concern
As at 31 December 2020, the Group had total current liabilities in excess of total current assets of RMB
3,870,940,636.24. On 31 December 2020, the Group had available and unused line of credit amounting to RMB
45,605,365,637.62, which is greater than the balance of the net current liabilities. The Group can obtain financial
support from the available line of credit when needed. Therefore, the financial statements have been prepared on a
going concern basis.
Basis of accounting and principle of measurement
The Group has adopted the accrual basis of accounting. Except for certain financial instruments which are measured
at fair value, the Group adopts the historical cost as the principle of measurement of the financial statements. Upon
being restructured into a stock company, the fixed assets and intangible assets initially contributed by the state-owned
shareholders are recognized based on the valuation amounts confirmed by the state-owned assets administration
department. Where assets are impaired, provisions for asset impairment are made in accordance with the relevant
requirements.
- 19 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(II) BASIS OF PREPARATION OF FINANCIAL STATEMENTS - continued
Basis of accounting and principle of measurement - continued
Where the historical cost is adopted as the measurement basis, assets are recorded at the amount of cash or cash
equivalents paid or the fair value of the consideration given to acquire them at the time of their acquisition. Liabilities
are recorded at the amount of proceeds or assets received or the contractual amounts for assuming the present
obligation, or, at the amounts of cash or cash equivalents expected to be paid to settle the liabilities in the normal
course of business.
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, regardless of whether that price is directly observable or
estimated using valuation technique. Fair value measurement and/or disclosure in the financial statements are
determined according to the above basis.
Fair value measurements are categorized into Level 1, 2 or 3 based on the degree to which the inputs to the fair value
measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which
are described as follows:
Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities that
the entity can access at the measurement date;
Level 2 inputs are inputs, other than quoted prices included within Level 1, that are
observable for the asset or liability, either directly or indirectly; and
Level 3 inputs are unobservable inputs for the asset or liability.
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES
All the following significant accounting policies and accounting estimates are based on the Accounting Standards for
Business Enterprises ("ASBE").
1. Statement of compliance with the ASBE
The financial statements of the Company have been prepared in accordance with the ASBE, and present truly and
completely, the Company’s and consolidated financial position as of 31 December 2020, and the Company’s and
consolidated results of operations, the Company’s and consolidated shareholders' equity and cash flows for the year
then ended.
2. Accounting period
The Group has adopted the calendar year as its accounting year, e.g. from 1 January to 31 December.
- 20 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
3. Operating cycle
An operating cycle refers to the period since when an enterprise purchases assets for processing purpose till the
realization of those assets in cash or cash equivalents. The Group are principally engaged in the rendering of port
service, bonded logistics service and other businesses such as property development and investment with one year
being an operating cycle.
4. Functional currency
Renminbi ("RMB") is the currency of the primary economic environment in which the Company and its domestic
subsidiaries operate. Therefore, the Company and its domestic subsidiaries choose RMB as their functional currency.
The Company's subsidiaries choose their functional currency on the basis of the primary economic environment in
which they operate. The Company adopts RMB to prepare its financial statements.
5. The accounting treatment of business combinations involving or not involving enterprises under
common control
Business combinations are classified into business combinations involving enterprises under common control and
business combinations not involving enterprises under common control.
5.1 Business combinations involving enterprises under common control
A business combination involving enterprises under common control is a business combination in which all of the
combining enterprises are ultimately controlled by the same party or parties both before and after the combination,
and that control is not transitory.
Assets and liabilities obtained shall be measured at their respective carrying amounts as recorded by the combining
entities at the date of the combination. The difference between the carrying amount of the net assets obtained and the
carrying amount of the consideration paid for the combination is adjusted to the share premium in capital reserve. If
the share premium is not sufficient to absorb the difference, any excess shall be adjusted against retained earnings.
Costs that are directly attributable to the combination are charged to profit or loss in the period in which they are
incurred.
5.2 Business combinations not involving enterprises under common control and goodwill
A business combination not involving enterprises under common control is a business combination in which all of the
combining enterprises are not ultimately controlled by the same party or parties before and after the combination.
- 21 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
5. The accounting treatment of business combinations involving or not involving enterprises under common
control - continued
5.2 Business combinations not involving enterprises under common control and goodwill - continued
The cost of combination is the aggregate of the fair values, at the acquisition date, of the assets given, liabilities
incurred or assumed, and equity securities issued by the acquirer, in exchange for control of the acquire. Where a
business combination not involving enterprises under common control is achieved in stages that involve multiple
transactions, the cost of combination is the sum of the consideration paid at the acquisition date and the fair value at
the acquisition date of the acquirer's previously held interest in the acquiree. The intermediary expenses (fees in
respect of auditing, legal services, valuation and consultancy services, etc.) and other administrative expenses
attributable to the business combination are recognized in profit or loss in the periods when they are incurred.
The acquiree's identifiable assets, liabilities and contingent liabilities acquired by the acquirer in a business
combination that meet the recognition criteria shall be measured at fair value at the acquisition date.
When a business combination contract provides for the acquirer's recovery of consideration previously paid
contingent on one or multiple future event(s), the Group recognises the contingent consideration provided in the
contract as an asset, as part of the consideration transferred in the business combination, and includes it in the cost of
business combination at the fair value at the acquisition date. Within 12 months after the acquisition, where the
contingent consideration needs to be adjusted as new or further evidences are obtained in respect of the circumstances
existed at the acquisition date, the adjustment shall be recognised and the amount originally recognised in goodwill or
non-operating income shall be adjusted. A change in or adjustment to the contingent consideration under other
circumstances shall be accounted for in accordance with Accounting Standard for Business Enterprise No. 22 -
Financial Instruments: Recognition and Measurement and Accounting Standard for Business Enterprises No. 13 -
Contingencies. Any change or adjustment is included in profit or loss for the current period.
Where the cost of combination exceeds the acquirer's interest in the fair value of the acquiree's identifiable net assets,
the difference is treated as an asset and recognized as goodwill, which is measured at cost on initial recognition.
Where the cost of combination is less than the acquirer's interest in the fair value of the acquiree's identifiable net
assets, the acquirer reassesses the measurement of the fair values of the acquiree's identifiable assets, liabilities and
contingent liabilities and measurement of the cost of combination. If after that reassessment, the cost of combination
is still less than the acquirer's interest in the fair value of the acquiree's identifiable net assets, the acquirer recognizes
the remaining difference immediately in profit or loss for the current period.
- 22 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
5. The accounting treatment of business combinations involving or not involving enterprises under common
control - continued
5.2 Business combinations not involving enterprises under common control and goodwill - continued
If either the fair values of identifiable assets, liabilities and contingent liabilities acquired in a combination or the cost
of business combination can be determined only provisionally by the end of the period in which the business
combination was effected, the acquirer recognises and measures the combination using those provisional values. Any
adjustments to those provisional values within twelve months after the acquisition date are treated as if they had been
recognised and measured on the acquisition date.
Goodwill arising on a business combination is measured at cost less accumulated impairment losses, and is presented
separately in the consolidated financial statements.
6. Preparation method of consolidated financial statements
6.1 Preparation method of consolidated financial statements
The scope of consolidation in the consolidated financial statements is determined on the basis of control. Control
exists when the investor has power over the investee; is exposed, or has rights, to variable returns from its
involvement with the investee; and has the ability to use its power over the investee to affect its returns. The Group
reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes of the above
elements of the definition of control.
Consolidation of a subsidiary begins when the Group obtains control over the subsidiaries and ceases when the Group
loses control of the subsidiary.
For a subsidiary already disposed of by the Group, the operating results and cash flows before the date of disposal
(the date when control is lost) are included in the consolidated income statement and consolidated statement of cash
flows, as appropriate.
For subsidiaries acquired through a business combination involving enterprises not under common control, the
operating results and cash flows from the acquisition date (the date when control is obtained) are included in the
consolidated income statement and consolidated statement of cash flows, as appropriate.
No matter when the business combination occurs in the reporting period, subsidiaries acquired through a business
combination involving enterprises under common control or the party being absorbed under merger by absorption are
included in the Group's scope of consolidation as if they had been included in the scope of consolidation from the
date when they first came under the common control of the ultimate controlling party. Their operating results and
cash flows from the date when they first came under the common control of the ultimate controlling party are
included in the consolidated income statement and consolidated statement of cash flows, as appropriate.
- 23 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
6. Preparation method of consolidated financial statements - continued
6.1 Preparation method of consolidated financial statements - continued
The significant accounting policies and accounting periods adopted by the subsidiaries are determined based on the
uniform accounting policies and accounting periods set out by the Company.
Where the accounting policies / accounting periods adopted by subsidiaries are inconsistent with those of the
Company, appropriate adjustments are made to the subsidiaries' financial statements in accordance with the
accounting policies of the Company.
All significant intra-group balances and transactions are eliminated on consolidation.
The portion of subsidiaries' equity that is not attributable to the parent is treated as minority interests and presented as
"minority interests" in the consolidated balance sheet under shareholders' equity. The portion of net profits or losses
of subsidiaries for the period attributable to minority interests is presented as "minority interests" in the consolidated
income statement under the "net profit" line item.
When the amount of loss for the period attributable to the minority shareholders of a subsidiary exceeds the minority
shareholders' portion of the opening balance of shareholders' equity of the subsidiary, the excess amount is still
allocated against minority interests.
Acquisition of minority interests or disposals of interests in a subsidiary that do not result in the loss of control over
the subsidiary are accounted for as equity transactions. The carrying amounts of the parent's interests and minority
interests are adjusted to reflect the changes in their relative interests in the subsidiary. The difference between the
amount by which the minority interests are adjusted and the fair value of the consideration paid or received is
adjusted to capital reserve. If the capital reserve is not sufficient to absorb the difference, the excess are adjusted
against retained earnings.
For the stepwise acquisition of equity interest till acquiring control after a few transactions and leading to business
combination not involving enterprises under common control, this should be dealt with based on whether this belongs
to 'package deal': if it belongs to 'package deal', transactions will be dealt as transactions to acquire control. If it
does not belong to 'package deal', transactions to acquire control on acquisition date will be under accounting
treatment, the fair value of acquirees' shares held before acquisition date will be revalued, and the difference between
fair value and book value will be recognized in profit or loss of the current period; if acquirees' shares held before
acquisition date involve in changes of other comprehensive income and other equity of owners under equity method,
this will be transferred to income of acquisition date.
- 24 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
6. Preparation method of consolidated financial statements - continued
6.1 Preparation method of consolidated financial statements - continued
When the Group loses control over a subsidiary due to disposal of equity investment or other reasons, any retained
interest is re-measured at its fair value at the date when control is lost. The difference between (i) the aggregate of the
consideration received on disposal and the fair value of any retained interest and (ii) the share of the former
subsidiary's net assets cumulatively calculated from the acquisition date according to the original proportion of
ownership interests is recognized as investment income in the period in which control is lost, and the goodwill is
offset accordingly. Other comprehensive income associated with investment in the former subsidiary is reclassified to
investment income in the period in which control is lost.
When the Group loses control of a subsidiary in two or more arrangements (transactions), terms and conditions of the
arrangements (transactions) and their economic effects are considered. One or more of the following indicate that
the Group shall account for the multiple arrangements as a 'package deal': (i) they are entered into at the same time
or in contemplation of each other; (ii) they form a complete transaction designed to achieve an overall commercial
effect; (iii) the occurrence of one transaction is dependent on the occurrence of at least one other transaction; (iv) one
transaction alone is not economically justified, but it is economically justified when considered together with other
transactions. Where the transactions of disposal of equity investments in a subsidiary until the loss of control are
assessed as a package deal, these transactions are accounted for as one transaction of disposal of a subsidiary with
loss of control. Before losing control, the difference of consideration received on disposal and the share of net assets
of the subsidiary continuously calculated from acquisition date is recognized as other comprehensive income. When
losing control, the cumulated other comprehensive income is transferred to profit or loss of the period of losing
control. If the transactions of disposal of equity investments in a subsidiary are not assessed as a package deal, these
transactions are accounted for as unrelated transactions.
7. Classification of joint arrangements and the accounting treatments of joint operations
There are two types of joint arrangements - joint operations and joint ventures. The classification of joint
arrangements under is determined based on the rights and obligations of parties to the joint arrangements by
considering the structure, the legal form of the arrangements, the contractual terms agreed by the parties to the
arrangement. A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement
have rights to the assets, and obligations for the liabilities, relating to the arrangement. A joint venture is a joint
arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the
arrangement.
Investments in joint ventures are accounted for using the equity method by the Group, which is detailed in Notes (III)
16.3.2, "Long-term equity investments accounted for using the equity method".
- 25 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
7. Classification of joint arrangements and the accounting treatments of joint operations - continued
The Group as a joint operator recognizes the following items in relation to its interest in a joint operation: (1) its
solely-held assets, including its share of any assets held jointly; (2) its solely-assumed liabilities, including its share
of any liabilities incurred jointly; (3) its revenue from the sale of its share of the output arising from the joint
operation; (4) its share of the revenue from the sale of the output by the joint operation; and (5) its solely-incurred
expenses, including its share of any expenses incurred jointly. The Group accounts for the recognized assets,
liabilities, revenues and expenses relating to its interest in a joint operation in accordance with the requirements
applicable to the particular assets, liabilities, revenues and expenses.
8. Recognition criteria of cash and cash equivalents
Cash comprises cash on hand and deposits that can be readily withdrawn on demand. Cash equivalents are the
Group's short-term(generally due within 3 months since the acquisition date), highly liquid investments that are
readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.
9. Transactions denominated in foreign currencies and translation of financial statements denominated
in foreign currencies
9.1 Transactions denominated in foreign currencies
A foreign currency transaction is recorded, on initial recognition, by applying the spot exchange rate on the date of
the transaction.
At the balance sheet date, foreign currency monetary items are translated into functional currency using the spot
exchange rates at the balance sheet date. Exchange differences arising from the differences between the spot
exchange rates prevailing at the balance sheet date and those on initial recognition or at the previous balance sheet
date are recognized in profit or loss for the period, except that (1) exchange differences related to a specific-purpose
borrowing denominated in foreign currency that qualify for capitalization are capitalized as part of the cost of the
qualifying asset during the capitalization period; (2) exchange differences related to hedging instruments for the
purpose of hedging against foreign currency risks are accounted for using hedge accounting; (3) exchange differences
arising from changes in the carrying amounts (other than the amortised cost) of monetary items at fair value through
other comprehensive income are recognised as other comprehensive income.
When the consolidated financial statements include foreign operation(s), if there is foreign currency monetary item
constituting a net investment in a foreign operation, exchange difference arising from changes in exchange rates are
recognized as "exchange differences arising on translation of financial statements denominated in foreign currencies "
in other comprehensive income, and in profit and loss for the period upon disposal of the foreign operation.
- 26 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
9. Transactions denominated in foreign currencies and translation of financial statements denominated
in foreign currencies - continued
9.1 Transactions denominated in foreign currencies - continued
Foreign currency non-monetary items measured at historical cost are translated to the amounts in functional currency
at the spot exchange rates on the dates of the transactions; the amounts in functional currency remain unchanged.
Foreign currency non-monetary items measured at fair value are re-translated at the spot exchange rate on the date the
fair value is determined. Difference between the re-translated functional currency amount and the original functional
currency amount is treated as changes in fair value (including changes of exchange rate) and is recognized in profit
and loss or as other comprehensive income.
9.2 Translation of financial statements denominated in foreign currencies
For the purpose of preparing the consolidated financial statements, financial statements of a foreign operation are
translated from the foreign currency into RMB using the following method: assets and liabilities on the balance
sheet are translated at the spot exchange rate prevailing at the balance sheet date; shareholders' equity items except for
unappropriated profit are translated at the spot exchange rates at the dates on which such items arose; all items in the
income statement as well as items reflecting the distribution of profits are translated at the average exchange rates of
the accounting period of the consolidated financial statements; the opening balance of unappropriated profit is the
translated closing balance of the previous year's unappropriated profit; the closing balance of unappropriated profit is
calculated and presented on the basis of each translated income statement and profit distribution item. The difference
between the translated assets and the aggregate of liabilities and shareholders' equity items is recognized as other
comprehensive income and included in shareholders' equity.
Cash flows arising from a transaction in foreign currency and the cash flows of a foreign subsidiary are translated at
average exchange rate during the accounting period of consolidated financial statements. The effect of exchange rate
changes on cash and cash equivalents is regarded as a reconciling item and presented separately in the cash flow
statement as "effect of exchange rate changes on cash and cash equivalents".
The closing balances and the comparative figures of previous year are presented at the translated amounts in the
previous year's financial statements.
On disposal of the Group's entire interest in a foreign operation, or upon a loss of control over a foreign operation due
to disposal of certain interest in it or other reasons, the Group transfers the accumulated exchange differences arising
on translation of financial statements of this foreign operation attributable to the owners' equity of the Company and
presented under owners' equity, to profit or loss in the period in which the disposal occurs.
- 27 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
9. Transactions denominated in foreign currencies and translation of financial statements denominated
in foreign currencies - continued
9.2 Translation of financial statements denominated in foreign currencies - continued
In case of a disposal of part equity investments or other reason leading to lower interest percentage in foreign
operations but does not result in the Group losing control over a foreign operation, the exchange differences arising
from the translation of foreign currency financial statements related to this disposed part are re-attributed to minority
interests and are not recognized in profit and loss. For partial disposals of equity interests in foreign operations which
are associates or joint ventures, the proportionate share of the accumulated exchange differences arising on translation
of financial statements of foreign operations is reclassified to profit or loss.
10. Financial instruments
The Group recognizes a financial asset or a financial liability when it becomes a party to the contractual provisions of
a financial instrument.
All regular way purchases or sales of financial assets are recognized and derecognized on a trade date basis.
Financial assets and financial liabilities are initially measured at fair value. For financial assets and financial liabilities
at fair value through profit or loss, relevant transaction costs are directly recognized in profit or loss; transaction costs
relating to other categories of financial assets and financial liabilities are included in the value initially recognized.
For accounts receivable recognized that do not contain a significant financing component or a financing component
included in the contracts less than one year which are not considered by the Group, which are within the scope of
Accounting Standard for Business Enterprises No.14 - Revenue (hereinafter referred to as "revenue standards"),
transaction prices defined in the standards shall be adopted on initial recognition.
The effective interest method is a method that is used in the calculation of the amortized cost of a financial asset or a
financial liability and in the allocation of the interest income or interest expense in profit or loss over the relevant
period.
The effective interest rate is the rate that exactly discounts estimated future cash flows through the expected life of the
financial asset or financial liability to the gross carrying amount of a financial asset or to the amortized cost of a
financial liability. When calculating the effective interest rate, the Group estimates future cash flows by considering
all the contractual terms of the financial asset or financial liability (for example, prepayment, extension, call option or
similar options) but shall not consider the expected credit losses.
- 28 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
The amortized cost of a financial asset or a financial liability is the amount of a financial asset or a financial liability
initially recognized net of principal repaid, plus or less the cumulative amortized amount arising from amortization of
the difference between the amount initially recognized and the amount at the maturity date using the effective interest
method, net of cumulative credit loss allowance (only applicable to financial assets).
10.1 Classification, recognition and measurement of financial assets
Subsequent to initial recognition, the Group's financial assets of various categories are subsequently measured at
amortized cost, at fair value through other comprehensive income or at fair value through profit or loss.
If contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding, and the financial asset is held within a business model
whose objective is to hold financial assets in order to collect contractual cash flows, such asset is classified into
financial assets measured at amortized cost, which include cash and bank balances, notes receivable, accounts
receivable, other receivables, debt investments, and long-term receivables and etc.
Financial assets that meet the following conditions are subsequently measured at fair value through other
comprehensive income ("FVTOCI"): the financial asset is held within a business model whose objective is achieved
by both collecting contractual cash flows and selling; and the contractual terms of the financial asset give rise on
specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
Financial assets at FVTOCI are presented as other debt investments. Other debt investments due within one year
(inclusive) since the balance sheet date are presented as non-current assets due within one year. Other debt
investments due within one year (inclusive) upon acquisition are presented as other current assets.
On initial recognition, the Group may irrevocably designate non-trading equity instruments, other than contingent
consideration recognized through business combination not involving enterprises under common control, as financial
assets at FVTOCI on an individual basis. Such financial assets at FVTOCI are presented as other equity instrument.
A financial asset is classified as held for trading if one of the following conditions is satisfied:
It has been acquired principally for the purpose of selling in the near term; or
On initial recognition it is part of a portfolio of identified financial instruments that the
Group manages together and there is objective evidence that the Group has a recent actual
pattern of short-term profit-taking; or
It is a derivative that is not a financial guarantee contract or designated and effective as a
hedging instrument.
- 29 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.1 Classification, recognition and measurement of financial assets - continued
Financial assets measured at fair value through profit or loss ("FVTPL") include those classified as financial assets at
FVTPL and those designated as financial assets at FVTPL.
Any financial assets that does not qualify for amortized cost measurement or measurement
at FVTOCI or designated at FVTOCI are classified into financial assets at FVTPL.
Upon initial recognition, in order to eliminate or significantly reduce accounting mismatch
and qualified hybrid financial instrument combines financial asset with embedded
derivatives, the Group will irrevocably designated it as financial liabilities at FVTPL.
Financial assets at FVTPL assets other than derivative financial assets are presented as "held-for-trading financial
assets". Such financial assets at FVTPL which may fall due more than one year (or without fixed term) since the
balance sheet date and will be held more than one year are presented as other non-current financial assets.
10.1.1 Financial assets measured at amortized cost
Financial assets measured at amortized cost are subsequently measured at amortized cost using the effective interest
method. Gain or loss arising from impairment or derecognition is recognized in profit or loss.
For financial assets measured at amortized cost, the Group recognizes interest income using effective interest method.
The Group calculates and recognizes interest income through book value of financial assets multiplying effective
interest, except for the following circumstances:
For purchased or originated credit-impaired financial assets with credit impairment, the
Group calculates and recognizes its interest income based on amortized cost of the financial
asset and the effective interest through credit adjustment since initial recognition.
10.1.2 Financial assets at FVTOCI
Impairment losses or gains related to financial assets at FVTOCI, interest income measured using effective interest
method and exchange gains or losses are recognized into profit or loss for the current period, except for the above
circumstances, changes in fair value of the financial assets are included in other comprehensive income. Amounts
charged to profit or loss for every period equal to the amount charged to profit or loss as it is measured at amortized
costs. When the financial asset is derecognized, the cumulative gains or losses previously recognized in other
comprehensive income shall be removed from other comprehensive income and recognized in profit or loss.
- 30 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.1 Classification, recognition and measurement of financial assets - continued
10.1.2 Financial assets at FVTOC I - continued
Changes in fair value of non-trading equity instrument investments designated as financial assets at FVTOCI are
recognized in other comprehensive income, and the cumulative gains or losses previously recognized in other
comprehensive income allocated to the part derecognized are transferred and included in retained earnings. During
the period in which the Group holds the non-trading equity instrument, revenue from dividends is recognized in profit
or loss for the current period when (1) the Group has established the right of collecting dividends; (2) it is probable
that the associated economic benefits will flow to the Group; and (3) the amount of dividends can be measured
reliably.
10.1.3 Financial assets at FVTPL
Financial assets at FVTPL are subsequently measured at fair value. Gain or loss arising from changes in fair values
and dividends and interests related to the financial assets are recognized in profit or loss.
10.2 Impairment of financial instruments
The Group makes accounting treatment on impairment and recognizes loss allowance for expected credit losses
("ECL") on financial assets measured at amortized cost, financial assets classified as at FVTOCI, lease receivables,
contract assets, loan commitments that are not financial liabilities at FVTPL, financial liabilities not measured at
FVTPL, financial guarantee contracts arising from transfer of financial assets which does not satisfy derecognition
criteria or continuing involvement of transferred financial assets.
The Group makes a loss allowance against amount of lifetime ECL of the contract assets, notes receivable and
accounts receivable arising from transactions adopting the Revenue Standard as well as lease receivables arising from
transactions adopting ASBE No. 21- Leases.
For other financial instrument, other than purchased or originated credit-impaired financial assets, the Group assesses
changes in credit risks of the relevant financial asset since initial recognition at each balance sheet date. If the credit
loss of the financial instrument has been significantly increased since initial recognition, the Group will make a loss
allowance at an amount of expected credit loss during the whole life; if not, the Group will make a loss allowance for
the financial instrument at an amount in the future 12-month expected credit losses. Except for the financial assets
classified as at FVTOCI, increase in or reversal of credit loss allowance is included in profit or loss as loss/gain on
impairment. For the financial assets classified as at FVTOCI, the Group recognizes credit loss allowance in other
comprehensive income and recognizes the loss/gain on impairment in profit or loss, while the Group does not
decrease the carrying amount of such financial assets in the balance sheet.
- 31 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.2 Impairment of financial instruments - continued
The Group has makes a loss allowance against amount of expected credit losses during the whole life in the prior
accounting period. However, at the balance sheet date, the credit risk on a financial instrument has not increased
significantly since initial recognition; the Group will measure the loss allowance for that financial instrument at an
amount in the future 12-month expected credit losses. Reversed amount of loss allowance arising from such
circumstances shall be included in profit or loss as impairment gains.
10.2.1 Significant increase of credit risk
In assessing whether the credit risk has increased significantly since initial recognition, the Group compares the risk
of a default occurring on the financial instrument as at the reporting date with the risk of a default occurring on the
financial instrument as at the date of initial recognition. For loan commitments, the date that the Group becomes a
party to the irrevocable commitment is considered to be the date of initial recognition in the application of criteria
related to the financial instrument for impairment.
In particular, the following information is taken into account when assessing whether credit risk has increased
significantly:
(1) Significant changes in internal price indicators of credit risk as a result of a change in credit risk;
(2) Other changes in the rates or terms of an existing financial instrument that would be significantly different if
the instrument was newly originated or issued at the balance sheet date (such as more stringent covenants,
increased amounts of collateral or guarantees, or higher income coverage).
(3) Significant changes in external market indicators of credit risk for a particular financial instrument or similar
financial instruments with the same expected life. These indicators include the credit spread, the credit swap
prices for the borrower, the length of time or the extent to which the fair value of a financial asset has been
less than its amortized cost and other market information related to the borrower, such as changes in the
price of a borrower’s debt and equity instruments.
(4) Significant changes in actual or expected external credit rating for the financial instruments;
(5) An actual or expected internal credit rating downgrade for the borrower
(6) Adverse changes in business, financial or economic conditions that are expected to cause a significant
change in the debtor’s ability to meet its debt obligations;
(7) An actual or expected significant change in the operating results of the debtor;
(8) Significant increases in credit risk on other financial instruments of the same borrower;
(9) Significant adverse change in the regulatory, economic, or technological environment of the debtor;
- 32 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.2 Impairment of financial instruments - continued
10.2.1 Significant increase of credit risk - continued
(10) Significant changes in the value of the collateral supporting the obligation or in the quality of third-party
guarantees or credit enhancements, which are expected to reduce the debtor’s economic incentive to make
scheduled contractual payments or to otherwise have an effect on the probability of a default occurring.
(11) Significant changes in circumstances expected to reduce the debtor’s economic incentive to make scheduled
contractual payments;
(12) Expected changes in the loan documentation including an expected breach of contract that may lead to
covenant waivers or amendments, interest payment holidays, interest rate step-ups, requiring additional
collateral or guarantees, or other changes to the contractual framework of the financial instrument;
(13) Significant changes in the expected performance and behavior of the debtor;
(14) Changes in the entity’s credit management approach in relation to the financial instrument;
(15) Past due of contract payment.
The Group assumes that the credit risk on a financial instrument has not increased significantly since initial
recognition if the financial instrument is determined to have lower credit risk at the balance sheet date. A financial
instrument is determined to have lower credit risk if: i) it has a lower risk of default, ii) the borrower has a strong
capacity to meet its contractual cash flow obligations in the near term and iii) 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.
10.2.2 Credit-impaired financial assets
When the Group expected occurrence of one or more events which may cause adverse impact on future cash flows of
a financial asset, the financial asset will become a credit-impaired financial assets. Objective evidence that a financial
asset is impaired includes but not limited to the following observable events:
(1) Significant financial difficulty of the issuer or debtor;
(2) A breach of contract by the debtor, such as a default or delinquency in interest or principal payments;
(3) The creditor, for economic or legal reasons relating to the debtor’s financial difficulty, granting a concession
to the debtor;
(4) It becoming probable that the debtor will enter bankruptcy or other financial reorganizations;
(5) The disappearance of an active market for that financial asset because of financial difficulties of the issuer or
the debtor;
(6) Purchase or originate a financial asset with a large scale of discount, which reflects facts of credit loss
incurred.
- 33 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.2 Impairment of financial instruments - continued
10.2.3 Determination of expected credit loss
Lease receivables are assessed for ECL individually by the Group. In addition, the Group uses provision matrix to
calculate ECL for notes receivable, accounts receivable, other receivables, contract assets, debt investments and other
debt investments based on a portfolio basis. The Group classifies financial instruments into different groups based on
common risk characteristics. Common credit risk characteristics include credit risk rating, the date of initial
recognition, remaining contractual maturity, industry of borrower and geographical location of the borrower etc.
The Group determines expected credit losses of relevant financial instruments using the following methods:
For a financial asset, a credit loss is the present value of the difference between the contractual cash flows that
are due to the Group under the contract and the cash flows that the Group expects to receive;
For a lease receivable, a credit loss is the present value of the difference between the contractual cash flows
that are due to the Group under the contract and the cash flows that the Group expects to receive;
For undrawn loan commitments (refer to Note III, 10.4.1.3 for the detail of accounting policies), the ECL is the
present value of the difference between the contractual cash flows that are due to the Group if the holder of the
loan commitments draws down the loan, and the cash flows that the Group expects to receive if the loan is
drawn down. The Group's estimation of the ECL for loan commitments is consistent with its expectation of the
loan commitments drawn down.
For a financial guarantee contract (refer to Note III, 10.4.1.3 for the detail of accounting policies ), the
expected losses is the present value of the expected payments to reimburse the holder for a credit loss that it
incurs less any amounts that the Group expects to receive from the holder, the debtor or any other party.
For a financial asset with credit-impaired at the balance sheet date, but not purchased or originated credit-
impaired, a credit losses is the difference between the asset’s gross carrying amount and the present value of
estimated future cash flows discounted at the financial asset’s original effective interest rate.
The factors reflected in methods of measurement of expected credit losses include an unbiased and probability-
weighted amount that is determined by evaluating a range of possible outcomes; time value of money; reasonable and
supportable information about past events, current conditions and forecasts on future economic status at balance sheet
date without unnecessary additional costs or efforts.
- 34 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.2 Impairment of financial instruments - continued
10.2.4 Write-down of financial assets
When the Group will no longer reasonably expect that the contractual cash flows of financial assets can be collected
in aggregate or in part, the Group will directly write down the carrying amount of the financial asset, which
constitutes derecognition of relevant financial assets.
10.3 Transfer of financial assets
The Group will derecognize a financial asset if one of the following conditions is satisfied: (i) the contractual rights
to the cash flows from the financial asset expire; (ii) the financial asset has been transferred and substantially all the
risks and rewards of ownership of the financial asset is transferred to the transferee; or (iii) although the financial
asset has been transferred, the Group neither transfers nor retains substantially all the risks and rewards of ownership
of the financial asset but has not retained control of the financial asset.
If the Group neither transfers nor retains substantially all the risks and rewards of ownership of a financial asset, and
it retains control of the financial asset, the Group will recognize the financial asset to the extent of its continuing
involvement in the transferred financial asset and recognize an associated liability. The Group will measure relevant
liabilities as follows:
For transferred financial assets carried at amortized cost, the carrying amount of relevant liabilities is the
carrying amount of financial assets transferred with continuing involvement less amortized cost of the Group's
retained rights (if the Group retains relevant rights upon transfer of financial assets) with addition of amortized
cost of obligations assumed by the Group (if the Group assumes relevant obligations upon transfer of financial
assets). Relevant liabilities are not designated as financial liabilities at fair value through profit or loss.
For transferred financial assets carried at fair value, the carrying amount of relevant financial liabilities is the
carrying amount of financial assets transferred with continuing involvement less fair value of the Group's
retained rights (if the Group retains relevant rights upon transfer of financial assets) with addition of fair value
of obligations assumed by the Group (if the Group assumes relevant obligations upon transfer of financial
assets). Accordingly, the fair value of relevant rights and obligations shall be measured on an individual basis.
- 35 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.3 Transfer of financial assets - continued
For a transfer of a financial asset in its entirety that satisfies the derecognition criteria, the difference between (1) the
carrying amount of the financial asset transferred and (2) the sum of the consideration received from the transfer and
accumulated changes in fair value initially recorded in other comprehensive income is recognized in profit or loss.
For the non-tradable equity instrument designated as financial assets at FVTOCI, cumulative gain or loss that has
been recognized in other comprehensive income should be removed from other comprehensive income but be
recognized in retained earnings.
For a part of transfer of a financial asset that satisfies the derecognition criteria, the carrying amount of the transferred
financial asset is allocated between the part that is derecognized and the part that is continuously involved, based on
the respective fair values of those parts on transfer date. The difference between (1) the sum of the consideration
received for the part derecognized and any cumulative gain or loss allocated to the part derecognized which has been
previously recognized in other comprehensive income; and (2) the carrying amount allocated to the part derecognized
on derecognition date; is recognized in profit or loss. For the non-tradable equity instrument designated as financial
assets at FVTOCI, cumulative gain or loss that has been recognized in other comprehensive income should be
removed from other comprehensive income but be recognized in retained earnings.
For a transfer of a financial asset in its entirety that does not satisfy the derecognition criteria, the Group will
continuously recognize the transferred financial asset in its entirety. Considerations received due to transfer of assets
should be recognized as a liability upon receipts.
10.4 Classification of financial liabilities and equity instruments
Financial instruments issued by the Group are classified into financial liabilities or equity instruments on the basis of
the substance of the contractual arrangements and the economic nature not only its legal form, together with the
definition of financial liability and equity instruments on initial recognition.
10.4.1 Classification, recognition and measurement of financial liabilities
On initial recognition, financial liabilities are classified into financial liabilities at FVTPL and other financial
liabilities.
10.4.1.1 Financial liabilities at FVTPL
Financial liabilities at FVTPL consist of financial liabilities held for trading (including derivatives classified as
financial liabilities) and those designated as at FVTPL. Except for derivative financial liabilities presented separately,
the financial liabilities at FVTPL are presented as held-for-trading financial liabilities.
- 36 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.4 Classification of financial liabilities and equity instruments - continued
10.4.1 Classification, recognition and measurement of financial liabilities- continued
10.4.1.1 Financial liabilities at FVTPL- continued
A financial liability is classified as held for trading if one of the following conditions is satisfied:
It has been acquired principally for the purpose of repurchasing in the near term; or
On initial recognition it is part of a portfolio of identified financial instruments that the
Group manages together and there is objective evidence that the Group has a recent actual
pattern of short-term profit-taking; or
It is a derivative that is not a financial guarantee contract or designated and effective as a
hedging instrument.
A financial liability may be designated as at FVTPL on initial recognition when one of the following conditions is
satisfied: (i) Such designation eliminates or significantly reduces accounting mismatch; or (ii) The Group makes
management and performance evaluation on a fair value basis, in accordance with the Group's formally documented
risk management or investment strategy, and reports to key management personnel on that basis. (iii) The qualified
hybrid financial instrument combines financial asset with embedded derivatives.
Transaction financial liabilities are subsequently measured at fair value. Any gains or losses arising from changes in
the fair value and any dividend or interest expenses paid on the financial liabilities are recognized in profit or loss.
The amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of that
liability shall be presented in other comprehensive income, other changes in fair values are included in profit or loss
for the current period. Upon the derecognition of such liability, the accumulated amount of change in fair value that is
attributable to changes in the credit risk of that liability, which is recognized in other comprehensive income, is
transferred to retained earnings. Any dividend or interest income earned on the financial liabilities are recognized in
profit or loss. If the impact of the change in credit risk of such financial liability dealt with in the above way would
create or enlarge an accounting mismatch in profit or loss, the Group shall present all gains or losses on that liability
(including the effects of changes in the credit risk of that liability) in profit or loss.
Financial liabilities are measured at FVTPL when the financial liabilities is arising from contingent consideration
recognized by the Group as an acquirer in a business combination not involving enterprises under common control.
- 37 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.4 Classification of financial liabilities and equity instruments - continued
10.4.1 Classification, recognition and measurement of financial liabilities- continued
10.4.1.2 Other financial liabilities
Except for financial liabilities, financial guarantee contracts and loan commitments arising from transfer of financial
assets that do not meet the derecognition criteria or those arising from continuing involvement in the transferred
financial assets, other financial liabilities are subsequently measured at amortized cost, with gain or loss arising from
derecognition or amortization recognized in profit or loss.
That the Group and its counterparty modify or renegotiate the contract does not result in derecognition of a financial
liability subsequently measured at amortized cost but result in changes in contractual cash flows, the Group will
recalculate the carrying amount of the financial liability, with relevant gain or loss recognized in profit or loss. The
Group will determine carrying amount of the financial liability based on the present value of renegotiated or modified
contractual cash flows discounted at the financial liability's original effective interest rate. For all costs or expenses
arising from modification or renegotiation of the contract, the Group will adjust the modified carrying amount of the
financial liability and make amortization during the remaining term of the modified financial liability.
10.4.1.3 Financial guarantee contracts and loan commitments
A financial guarantee contract is a contract that requires the issuer to make specified payments to reimburse the
holder of the contract for a loss it incurs because a specified debtor fails to make payment when due in accordance
with the original or modified terms of a debt instrument. Subsequent to initial recognition, financial guarantee
contracts that are not designated as financial liabilities at fair value through profit or loss or financial liabilities arising
from transfer of financial assets that do not meet the derecognition criteria or those arising from continuing
involvement in the transferred financial assets, and loan commitments to provide a loan at a below-market interest
rate, which are not designated at fair value through profit or loss, are measured at the higher of: (1) amount of loss
provision; and (2) the amount initially recognized less cumulative amortization amount determined based on the
revenue standard.
10.4.2 Derecognition of financial liabilities
The Group derecognizes a financial liability (or part of it) when the underlying present obligation (or part of it) is
discharged. An agreement between the Group (the debtor) and the creditor to replace the original financial liability
with a new financial liability with substantially different terms is accounted for as an extinguishment of the original
financial liability and the recognition of a new financial liability.
- 38 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.4 Classification of financial liabilities and equity instruments - continued
10.4.2 Derecognition of financial liabilities - continued
When the Group derecognizes a financial liability or a part of it, it recognizes the difference between the carrying
amount of the financial liability (or part of the financial liability) derecognized and the consideration paid (including
any non-cash assets transferred or new financial liabilities assumed) in profit or loss.
10.4.3 Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of
its liabilities. Equity instruments issued (including refinanced), repurchased, sold and cancelled by the Group are
recognized as changes of equity. Changes of fair value of equity instruments is not recognized by the Group.
Transaction costs related to equity transactions are deducted from equity.
The Group recognizes the distribution to holders of the equity instruments as distribution of profits, dividends paid do
not affect total amount of shareholders' equity.
10.5 Derivatives and embedded derivatives
Derivatives include forward exchange contracts, currency swaps, interest rate swaps and foreign exchange options,
etc. Derivatives are initially measured at fair value at the date when the derivative contracts are entered into and are
subsequently re-measured at fair value.
Derivatives embedded in hybrid contracts with a financial asset host are not separated by the Group. The hybrid
contract shall apply to the relevant accounting standards regarding the classification of financial assets as a whole.
Derivatives embedded in hybrid contracts with hosts that are not financial assets are separated and treated as separate
derivatives by the Group when they meet the following conditions:
(1) the economic characteristics and risks of the embedded derivative are not closely related to those of the host
contract;
(2) a separate instrument with the same terms as the embedded derivative would meet the definition of a
derivative.
(3) the hybrid contracts are not measured at fair value through profit or loss.
- 39 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.5 Derivatives and embedded derivatives - continued
For the embedded derivative separated from the host contracts, the Group accounts for the host contracts in the hybrid
contracts with applicable accounting standards. When the embedded derivatives whose fair value cannot be measured
reliably by the Group according to the terms and conditions of the embedded derivatives, the fair value of such
derivatives are measured at the difference between the fair value of the hybrid contracts and the fair value of the host
contracts.
By adopting the above method, if the embedded derivative cannot be measured on a stand-alone basis at the time
when acquired or at subsequent balance sheet dates, the hybrid instrument is designated as financial instruments at
fair value through profit or loss as a whole.
10.6 Offsetting financial assets and financial liabilities
Where the Group has a legal right that is currently enforceable to set off the recognized financial assets and financial
liabilities, and intends either to settle on a net basis, or to realize the financial asset and settle the financial liability
simultaneously, a financial asset and a financial liability shall be offset and the net amount is presented in the balance
sheet. Except for the above circumstances, financial assets and financial liabilities shall be presented separately in the
balance sheet and shall not be offset.
10.7 Reclassification of financial instruments
When the Group changes the business model to manage the financial assets, the financial assets affected will be
reclassified and no financial liabilities will be reclassified.
The financial assets are reclassified by the Group and are accounted for prospectively since the date of reclassification
(i.e. the first date of the initial reporting period after the business model of which the financial assets are reclassified
by the enterprise is changed).
Where a financial asset at amortised cost is reclassified as a financial assets at fair value through profit or loss
("FVTPL") by the Group, such financial asset is measured at fair value at the date of reclassification and the
difference between the original carrying amount and the fair value is recognized in profit or loss for the period.
Where a financial asset at amortised cost is reclassified as a financial asset at fair value through other comprehensive
income ("FVTOCI") by the Group, such financial asset is measured at the fair value at the date of reclassification, and
the difference between the original amount and the fair value is recognized in other comprehensive income.
- 40 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.7 Reclassification of financial instruments- continued
Where a financial asset at FVTOCI is reclassified as a financial asset at amortised cost by the Group, the accumulated
gains or losses previously recognized in other comprehensive income are transferred out and the fair value is adjusted
as the fair value at the date of reclassification. The adjusted fair value is recognized as the new carrying amount, as if
the financial asset had been measured at amortised cost.
Where a financial asset at FVTOCI is reclassified as a financial asset at FVTPL by the Group, such financial asset
continues to be accounted for at fair value. At the same time, the accumulated gains or losses previously recognized
in other comprehensive income are transferred to profit or loss for the period.
Where a financial asset at FVTPL is reclassified as a financial asset at amortised cost by the Group, the fair value at
the date of reclassification is recognized as the new account balance.
Where a financial asset at FVTPL is reclassified as a financial asset at FVTOCI by the Group, such financial asset
continues to be measured at fair value.
Where a financial asset at FVTPL is reclassified, the effective interest rate is determined on the basis of the fair value
of the financial asset at the date of reclassification.
11. Accounts receivable
The Group makes internal credit ratings on customers and determines expected losses rate of notes receivable,
accounts receivable and other receivables. Basis for determining ratings and the expected losses rates are as follows:
Internal credit Average expected loss rate
Basis for determining portfolio
rating (%)
Customers can make repayments within credit term and have
good credit records based on historical experience. The
A 0.00-0.10
probability of default on payment of due amounts is extremely
low in the foreseeable future.
The customer may have overdue payment based on historical
B 0.10-0.30
experience but they can make repayments.
The evidences indicate that the overdue credit risks of the
C customer are significantly increased and there is probability of 0.30-50.00
default on payment.
The evidences indicate that the accounts receivable are impaired
D or the customer has significant financial difficulty. The amounts 50.00-100.00
cannot be recovered in the foreseeable future.
- 41 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
12. Receivables financing
Notes receivable classified to hedging instruments for the purpose of hedging, should be listed as receivables
financing within one year (including one year). If the term above one year, it should be listed as other investment on
bonds. Related accounting policies refer to Note III, 10.
13. Inventories
13.1 Categories of inventories
Inventories include raw materials, merchandise and others. Inventories are initially measured at cost. Cost of
inventories comprises all costs of purchase, costs of conversion and other expenditures incurred in bringing the
inventories to their present location and condition.
13.2 Valuation method of inventories upon delivery
The actual cost of inventories upon delivery is calculated using the weighted average method.
13.3 Basis for determining net realizable value of inventories and provision methods for decline in value of
inventories
At the balance sheet date, inventories are measured at the lower of cost and net realizable value. If the cost of
inventories is higher than the net realizable value, a provision for decline in value of inventories is made. Net
realizable value is the estimated selling price in the ordinary course of business less the estimated costs of completion,
the estimated costs necessary to make the sale and relevant taxes. Net realizable value is determined on the basis of
clear evidence obtained, after taking into consideration the purposes of inventories being held and effect of post
balance sheet events.
Provision for decline in value of other inventories is made based on the excess of cost of inventory over its net
realizable value on an item-by-item basis.
After the provision for decline in value of inventories is made, if the circumstances that previously caused inventories
to be written down below cost no longer exist so that the net realizable value of inventories is higher than their cost,
the original provision for decline in value is reversed and the reversal is included in profit or loss for the period.
13.4 Inventory count system
The perpetual inventory system is maintained for stock system.
- 42 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
13. Inventories - continued
13.5 Amortization methods for low cost and short-lived consumable items and packaging materials
Packaging materials and low cost and short-lived consumable items are amortized using the immediate write-off
method.
14. Contract assets
14.1 Recognition and criteria of contract assets
A contract asset represents the Group's right to consideration in exchange for goods or services that the Group has
transferred to a customer, and such right depends on factors other than the passage of time. The Group's unconditional
right (only the passage of time is required) to consideration from the customer is separately presented as " accounts
receivable".
14.2 Determination and accounting treatments of expected credit losses ("ECL") for contract assets
Refer to Note III,10.2 " Impairment of financial instruments" for determination and accounting treatments of expected
credit losses for contract assets.
15. Assets held for sale
When the Group withdraw the book value of certain assets or disposal group mainly through disposal instead of
continual application, the assets should be classified as held-for-sale assets.
Assets or disposal group classified as held-for-sale assets should meat following conditions: (1) The current status
is available for immediate distribution according to similar transactions of this category of assets or disposal group; (2)
The transaction is likely to occur, i.e. the Group has made its resolution over the distribution arrangements and
acquired purchase commitment. Also the distribution is going to be fulfilled within a year.
If the holding company loses control of its subsidiary for reasons like subsidiary disposal, in regardless of whether the
holding company still keeps part of equity investment, once the proposed investment disposal meets the requirements
of being classified as available for sale assets in the holding company's individual statement, all assets and liabilities
of the subsidiary should be classified as held-for-sale in consolidated financial statement.
- 43 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
15. Assets held for sale - continued
The group's non-current assets and disposal group are measured at the lower of book value and the net value of fair
value less costs to sell. Once the book value is higher than the net value of fair value less costs to sell, the book value
should be adjusted to the net value and the excess should be recognized as impairment losses and provision for held-
for-sale assets impairment should be made. A gain and a reverse in the previous provision for held-for-sale assets
impairment can be recognized for any increase in fair value less costs to sell at subsequent balance sheet dates, to the
extent that it is not in excess of the cumulative impairment loss that has been recognized. Asset impairment losses
recognized before such assets are classified as held for sale will not be reversed.
Non-current held-for-sale assets is not subject to depreciation and amortization. The creditor interest and other
expenses of disposal group classified as held-for-sale asset should still be recognized.
Once the associate or joint venture equity investment is completely or partly classified as held-for-sale assets, the
classified part of the investment is not subject to equity method measurement.
If an asset or a disposal group has been classified as held for sale but the recognition criteria for non-current assets
held for sale are no longer met, the Group shall cease to classify the asset or disposal group as held for sale. It shall be
measured at the lower of (1) the carrying amount before the asset or disposal group was classified as held for sale,
adjusted for any depreciation, amortisation or impairment that would have been recognised had the asset or disposal
group not been classified as held for sale; and (2) the recoverable amount at the date of the decision not to sell.
For equity investments in associates or joint ventures that are classified as held for sale but the recognition for non-
current assets held for sale are no longer met, such investments are accounted for retrospectively using the equity
method from the date when they classified as held for sale. The financial statements for the held-for-sale period are
adjusted accordingly.
16. Long-term equity investments
16.1 Basis for determining joint control and significant influence over investee
Control is archived when the Group has the power over the investee and has rights to variable returns from its
involvement with the investee; and has the ability to use its power to affect its returns. Joint control is the
contractually agreed sharing of control over an economic activity, and exists only when the strategic financial and
operating policy decisions relating to the activity require the unanimous consent of the parties sharing control.
Significant influence is the power to participate in the financial and operating policy decisions of the investee but is
not control or joint control over those policies. When determining whether an investing enterprise is able to exercise
control or significant influence over an investee, the effect of potential voting rights of the investee (for example,
warrants and convertible debts) held by the investing enterprises or other parties that are currently exercisable or
convertible shall be considered.
- 44 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
16. Long-term equity investments - continued
16.2 Determination of initial investment cost
For a long-term equity investment acquired through a business combination involving enterprises under common
control, the investment cost of the long-term equity investment is the attributable share of the carrying amount of the
shareholders' equity of the acquiree at the date of combination. The difference between the initial investment cost and
the carrying amount of cash paid, non-cash assets transferred and liabilities assumed shall be adjusted to capital
reserve. If the balance of capital reserve is not sufficient, any excess shall be adjusted to retained earnings. If the
consideration of the combination is satisfied by the issue of equity securities, the initial investment cost of the long-
term equity investment shall be the share of party being absorbed of the owners' equity in the consolidated financial
statements of the ultimate controlling party at the date of combination. The aggregate face value of the shares issued
shall be accounted for as share capital. The difference between the initial investment cost and the aggregate face value
of the shares issued shall be adjusted to capital reserve. If the balance of capital reserve is not sufficient, any excess
shall be adjusted to retained earnings. Where equity interests in an acquiree are acquired in stages through multiple
transactions ultimately constituting a business combination involving entities under common control, the acquirer
shall determine if these transactions are considered to be a "package deal". If yes, these transactions are accounted for
as a single transaction where control is obtained. If no, the initial investment cost of the long-term equity investment
is the share of book value of owners' equity of the acquired entity in the ultimate controlling party's consolidated
financial statements at the date of combination. The difference between the initial investment cost and the sum of
carrying amount of equity investments previously held in the acquiree and the new investment cost is adjusted to
capital reserve. If the balance of capital reserve is not sufficient to absorb the difference, any excess is adjusted to
retained earnings. Other comprehensive income recognized for the previously held equity investments by accounting
treatment of equity method or available-for-sale financial assets is not subject to accounting treatment temporarily.
For a long-term equity investment acquired through business combination not involving enterprises under common
control, the investment cost of the long-term equity investment acquired is the cost of acquisition.
The absorbing party's or purchaser's intermediary expenses (fees in respect of auditing, legal services, valuation and
consultancy services, etc.) and other administrative expenses attributable to the business combination are recognized
in profit or loss in the periods when they are incurred.
The long-term equity investment acquired otherwise than through a business combination is initially measured at its
cost. When the entity is able to exercise significant influence or joint control (but not control) over an investee due to
additional investment, the cost of long-term equity investments is the sum of the fair value of previously-held equity
investments determined in accordance with Accounting Standard for Business Enterprises No.22 - Financial
Instruments: Recognition and Measurement (ASBE No. 22) and the additional investment cost.
- 45 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
16. Long-term equity investments - continued
16.3 Subsequent measurement and recognition of profit or loss
16.3.1 Long-term equity investments accounted for using the cost method
Long-term equity investments in subsidiaries are accounted for using the cost method in the Company's separate
financial statements. A subsidiary is an investee that is controlled by the Group.
Under the cost method, a long-term equity investment is measured at initial investment cost. Additional or
withdrawing investment would affect the cost of long-term equity investment. Investment income is recognized in the
period in accordance with the attributable share of cash dividends or profit distributions declared by the investee.
16.3.2 Long-term equity investments accounted for using the equity method
Except associate and joint venture investment completely or partly classified as available for sale, and The Group
accounts for investment in associates and joint ventures using the equity method. An associate is an entity over which
the Group has significant influence and a joint venture is a joint arrangement whereby the parties that have joint
control of the arrangement have rights to the net assets of the joint arrangement.
Under the equity method, where the initial investment cost of a long-term equity investment exceeds the Group's
share of the fair value of the investee's identifiable net assets at the time of acquisition, no adjustment is made to the
initial investment cost. Where the initial investment cost is less than the Group's share of the fair value of the
investee's identifiable net assets at the time of acquisition, the difference is recognized in profit or loss for the period,
and the cost of the long-term equity investment is adjusted accordingly.
- 46 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
16. Long-term equity investments - continued
16.3 Subsequent measurement and recognition of profit or loss - continued
16.3.2 Long-term equity investments accounted for using the equity method - continued
Under the equity method, the Group recognizes its share of the other comprehensive income and net profit or loss of
the investee for the period as other comprehensive income and investment income or loss respectively for the period,
and the carrying amount of the long-term equity investment is adjusted accordingly. The carrying amount of the
investment shall be reduced by the portion of any profit distributions or cash dividends declared by the investee that is
distributed to the investing enterprise. The investing enterprise shall adjust the carrying amount of the long-term
equity investment for other changes in owners' equity of the investee (other than net profits or losses, other
comprehensive income and profit distribution), and include the corresponding adjustment in capital reserve. The
Group recognizes its share of the investee's net profit or loss based on the fair value of the investee's individually
identifiable assets at the acquisition date after making appropriate adjustments. Where the accounting policies and
accounting period adopted by the investee are different from those of the investing enterprise, the investing enterprise
shall adjust the financial statements of the investee to conform to its own accounting policies and accounting period,
and recognize other comprehensive income and investment income or losses based on the adjusted financial
statements. Unrealized profits or losses resulting from the Group's transactions and assets invested or sold that are not
recognized as business transactions with its associates and joint ventures are recognized as investment income or loss
to the extent that those attributable to the Group's, equity interest are eliminated. However, unrealized losses resulting
from the Group's transactions with its associates and joint ventures which represent impairment losses on the
transferred assets are not eliminated.
The Group discontinues recognizing its share of net losses of the investee after the carrying amount of the long-term
equity investment together with any long-term interests that in substance form part of its net investment in the
investee are reduced to zero. Except that if the Group has incurred obligations to assume additional losses, a provision
is recognized according to the obligation expected, and recorded in the investment loss for the period. Where net
profits are subsequently made by the investee, the Group resumes recognizing its share of those profits only after its
share of the profits exceeds the share of losses previously not recognized.
16.4 Disposal of long-term equity investments
On disposal of a long-term equity investment, the difference between the proceeds actually received and receivable
and the carrying amount is recognized in profit or loss for the period.
For long-term equity investments accounted for using the equity method, if the remaining interest after disposal is
still accounted for using the equity method, other comprehensive income previously recognized for using the equity
method is accounted for on the same basis as would have been required if the investee had directly disposed of related
assets or liabilities, and transferred to profit or loss for the period on a pro rata basis; owners' equity recognized due to
changes in other owners' equity of the investee (other than net profit or loss, other comprehensive income and profit
distribution) is transferred to profit or loss for the period on a pro rata basis.
- 47 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
16. Long-term equity investments - continued
16.4 Disposal of long-term equity investments - continued
For long-term equity investments accounted for using the cost method, if the remaining interest after disposal is still
accounted for using the cost method, other comprehensive income previously recognized for using the equity method
or in accordance with the standards for the recognition and measurement of financial instruments before obtaining the
control over the investee, is accounted for on the same basis as would have been required if the investee had directly
disposed of related assets or liabilities, and transferred to profit or loss for the period on a pro rata basis; changes in
other owners' equity in the investee's net assets recognized under the equity method (other than net profit or loss,
other comprehensive income and profit distribution) is transferred to profit or loss for the period on a pro rata basis.
17. Investment properties
Investment property is property held to earn rentals or for capital appreciation or both. It includes a land use right that
is leased out; a land use right held for transfer upon capital appreciation; and a building that is leased out.
An investment property is measured initially at cost. Subsequent expenditures incurred for such investment property
are included in the cost of the investment property if it is probable that economic benefits associated with an
investment property will flow to the Group and the subsequent expenditures can be measured reliably, other
subsequent expenditures are recognized in profit or loss in the period in which they are incurred.
The Group uses the cost model for subsequent measurement of investment property, and adopts a depreciation or
amortization policy for the investment property which is consistent with that for buildings or land use rights.
An investment property is derecognized upon disposal or when the investment property is permanently withdraw
from use and no future economic benefits are expected from the disposal.
When an investment property is sold, transferred, retired or damaged, the Group recognizes the amount of any
proceeds on disposal net of the carrying amount and related taxes in profit or loss for the period.
- 48 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
18. Fixed assets
18.1 Recognition criteria for fixed assets
Fixed assets are tangible assets that are held for use in the production or supply of goods or services, for rental to
others, or for administrative purposes, and have useful lives of more than one accounting year. A fixed asset is
recognized only when it is probable that economic benefits associated with the asset will flow to the Group and the
cost of the asset can be measured reliably. Fixed assets are initially measured at cost. Upon being restructured into a
stock company, the fixed assets initially contributed by the state-owned shareholders are recognized based on the
valuation amounts confirmed by the state-owned assets administration department.
Subsequent expenditures incurred for the fixed asset are included in the cost of the fixed asset and if it is probable that
economic benefits associated with the asset will flow to the Group and the subsequent expenditures can be measured
reliably. Meanwhile the carrying amount of the replaced part is derecognized. Other subsequent expenditures are
recognized in profit or loss in the period in which they are incurred.
18.2 Depreciation method
A fixed asset is depreciated over its useful life using the straight-line method starting from the month subsequent to
the one in which it is ready for intended use. The useful life, estimated net residual value rate and annual depreciation
rate of each category of fixed assets are as follows:
Estimated Estimated Annual
Category
useful lives residual value (%) depreciation rate (%)
Port and terminal facilities 5-50 years 5.00 1.90-19.00
Buildings and structures 10-50 years 5.00 1.90-9.50
Machinery and equipment, furniture and
3-20 years 5.00 4.75-31.67
fixture and other equipment
Motor vehicles and cargo ships 5-25 years 5.00 3.80-19.00
Estimated net residual value of a fixed asset is the estimated amount that the Group would currently obtain from
disposal of the asset, after deducting the estimated costs of disposal, if the asset were already of the age and in the
condition expected at the end of its useful life.
18.3 Other explanations
If a fixed asset is upon disposal or no future economic benefits are expected to be generated from its use or disposal,
the fixed asset is derecognized. When a fixed asset is sold, transferred, retired or damaged, the amount of any
proceeds on disposal of the asset net of the carrying amount and related taxes is recognized in profit or loss for the
period.
The Group reviews the useful life and estimated net residual value of a fixed asset and the depreciation method
applied at least once at each financial year-end, and account for any change as a change in an accounting estimate.
- 49 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
19. Construction in progress
Construction in progress is measured at its actual costs. The actual costs include various construction expenditures
during the construction period, borrowing costs capitalized before it is ready for intended use and other relevant costs.
Construction in progress is not depreciated. Construction in progress is transferred to a fixed asset when it is ready for
intended use.
20. Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying asset are capitalized
when expenditures for such asset and borrowing costs are incurred and activities relating to the acquisition,
construction or production of the asset that are necessary to prepare the asset for its intended use or sale have
commenced. Capitalization of borrowing costs ceases when the qualifying asset being acquired, constructed or
produced becomes ready for its intended use or sale. Capitalization of borrowing costs is suspended during periods in
which the acquisition, construction or production of a qualifying asset is interrupted abnormally and when the
interruption is for a continuous period of more than 3 months. Capitalization is suspended until the acquisition,
construction or production of the asset is resumed. Other borrowing costs are recognized as an expense in the period
in which they are incurred.
Where funds are borrowed under a specific-purpose borrowing, the amount of interest to be capitalized is the actual
interest expense incurred on that borrowing for the period less any bank interest earned from depositing the borrowed
funds before being used on the asset or any investment income on the temporary investment of those funds. Where
funds are borrowed under general-purpose borrowings, the Group determines the amount of interest to be capitalized
on such borrowings by applying a capitalization rate to the weighted average of the excess of cumulative expenditures
on the asset over the amounts of specific-purpose borrowings. The capitalization rate is the weighted average of the
interest rates applicable to the general-purpose borrowings. During the capitalization period, exchange differences
related to a specific-purpose borrowing denominated in foreign currency are all capitalized. Exchange differences in
connection with general-purpose borrowings are recognized in profit or loss in the period in which they are incurred.
21. Intangible assets
21.1 Valuation method and useful life of intangible assets
An intangible asset is measured initially at cost. Upon being restructured into a stock company, the intangible assets
initially contributed by the state-owned shareholders are recognized based on the valuation amounts confirmed by the
state-owned assets administration department. Except for port operation rights, when an intangible asset with a finite
useful life is available for use, its original cost is amortized over its estimated useful life The terminal operating rights
are amortized using the output method, that is, amortized through periods according to the ratio of the estimated
minimum guaranteed throughput to the estimated minimum guaranteed total throughput during the operation period.
When the estimated minimum guaranteed throughput cannot be measured reliably, the straight-line method will be
used for amortization. An intangible asset with uncertain useful life will not be amortized. The amortization method,
useful life and estimated net residual value of various intangible assets are as follows:
- 50 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
21. Intangible assets - continued
21.1 Valuation method and useful life of intangible assets - continued
Category Amortization Method Useful Life (year) Residual value (%)
Land use rights Straight-line method 40-50 -
Terminal operating right Output/Straight-line method 30-35 -
Others Straight-line method 5-50 -
For an intangible asset with a finite useful life, the Group reviews the useful life and amortization method at the end
of the year, and makes adjustments when necessary.
21.2 Internal research and development expenditure
Expenditure during the research phase is recognised as an expense in the period in which it is incurred.
Expenditure during the development phase that meets all of the following conditions at the same time is recognised as
intangible asset. Expenditure during development phase that does not meet the following conditions is recognised in
profit or loss for the period.
(1) it is technically feasible to complete the intangible asset so that it will be available for use or sale;
(2) the Group has the intention to complete the intangible asset and use or sell it;
(3) the Group can demonstrate the ways in which the intangible asset will generate economic benefits, including
the evidence of the existence of a market for the output of the intangible asset or the intangible asset itself or,
if it is to be used internally, the usefulness of the intangible asset;
(4) the availability of adequate technical, financial and other resources to complete the development and the
ability to use or sell the intangible asset; and
(5) the expenditure attributable to the intangible asset during its development phase can be reliably measured.
If the expenditures cannot be distinguished between the research phase and development phase, the Group recognises
all of them in profit or loss for the period. The costs of intangible assets generated by the internal research only
include the total expenditure incurred for the period from the time point of capitalization to the intangible assets are
ready for intended use. For the identical intangible asset, the expenditures recorded as expenses before they qualify
for capitalization during the development process are not adjusted.
- 51 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
22. Impairment of long-term assets
The Group assesses at the balance sheet date whether there is any indication that the long-term equity investments,
investment properties measured at cost method, construction in progress, fixed assets, right-of-use assets and
intangible assets with a finite useful life may be impaired. If there is any indication that such assets may be impaired,
recoverable amounts are estimated for such assets. Intangible assets with indefinite useful life and intangible assets
not yet available for use are tested for impairment annually, irrespective of whether there is any indication that the
assets may be impaired.
Recoverable amount is estimated on individual basis. If it is not practical to estimate the recoverable amount of an
individual asset, the recoverable amount of the asset group to which the asset belongs will be estimated. The
recoverable amount of an asset is the higher of its fair value less costs of disposal and the present value of the future
cash flows expected to be derived from the asset.
If the recoverable amount of an asset or an asset group is less than its carrying amount, the deficit is accounted for as
an impairment loss and is recognized in profit or loss.
Goodwill is tested for impairment at least at the end of each year. For the purpose of impairment testing, goodwill is
considered together with the related assets groups, i.e., goodwill is reasonably allocated to the related assets groups or
each of assets groups expected to benefit from the synergies of the combination. In testing an assets group with
goodwill for impairment, an impairment loss is recognized if the recoverable amount of the assets group or sets of
assets groups (including goodwill) is less than its carrying amount. The impairment loss is firstly allocated to reduce
the carrying amount of any goodwill allocated to such assets group or sets of assets groups, and then to the other
assets of the group pro-rata basis on the basis of the carrying amount of each asset (other than goodwill) in the group.
Once the impairment loss of above-mentioned asset is recognized, it shall not be reversed in any subsequent period.
23. Long-term prepaid expenses
Long-term prepaid expenses represent expenses incurred that should be borne and amortized over the current and
subsequent periods (together of more than one year). Long-term prepaid expenses are amortized using the straight-
line method over the expected periods in which benefits are derived.
24. Contract liabilities
A contract liability represents the Group’s obligation to transfer goods or services to a customer for which the Group
has received consideration (or an amount of consideration is due) from the customer. A contract asset and a contract
liability relating to the same contract are accounted for and presented on a net basis.
- 52 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
25. Employee benefits
25.1 Accounting treatment of short-term employee benefits
Actually occurred short-term employee benefits are recognized as liabilities, with a corresponding charge to the profit
or loss for the period or in the costs of relevant assets in the accounting period in which employees provide services to
the Group. Staff welfare expenses incurred by the Group are recognized in profit or loss for the period or the costs
of relevant assets based on the actually occurred amounts when it actually occurred. Non-monetary staff welfare
expenses are measured at fair value.
Payment made by the Group of social security contributions for employees such as premiums or contributions on
medical insurance, work injury insurance and maternity insurance, etc. and payments of housing funds, as well as
union running costs and employee education costs provided in accordance with relevant requirements, are calculated
according to prescribed bases and percentages in determining the amount of employee benefits and recognized as
relevant liabilities, with a corresponding charge to the profit or loss for the period or the costs of relevant assets in the
accounting period in which employees provide services.
25.2 Accounting treatment of post-employment benefits
Post-employment benefits are classified into defined contribution plans and defined benefit plans.
During the accounting period of rendering service to employees of the Group, amount which should be paid
according to defined contribution plans is recognized as liabilities, and recognized in profit or loss or related costs of
assets.
For defined benefit plans, the Group calculates defined benefit plan obligations using projected unit credit method
and the service cost resulting from employee service in the current period is recorded in profit or loss or the cost of
related assets. Defined benefit costs are categorized as follows:
Service cost (including current service cost, past service cost, as well as gains and losses on
settlements);
Net interest of net liabilities or assets of defined benefit plan (including interest income of
planned assets, interest expenses of defined benefit plan liabilities and effect of asset ceiling);
and
Changes arising from remeasurement of net liabilities or net assets of defined benefit plans.
- 53 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
25. Employee benefits - continued
25.2 Accounting treatment of post-employment benefits - continued
Service costs and net interest of net liabilities and net assets of defined benefit plans are recognized in profit or loss of
current period or costs of related assets. Remeasurement of the net defined benefit liability (asset) (including actuarial
gains and losses, the return on plan assets, excluding amounts included in net interest on the net defined benefit
liability (asset), and any change in the effect of the asset ceiling, excluding amounts included in net interest on the net
defined benefit liability (asset)) are recognized in other comprehensive income.
25.3 Accounting treatment of termination benefits
When the Group provides termination benefits to employees, employee benefit liabilities are recognized for
termination benefits, with a corresponding charge to the profit or loss for the period at the earlier of: (1) when the
Group cannot unilaterally withdraw the offer of termination benefits because of the termination plan or a curtailment
proposal; and (2) when the Group recognizes costs or expenses related to restructuring that involves the payment of
termination benefits.
26. Provisions
Provisions are recognized when the Group has a present obligation related with contingencies, it is probable that the
Group will be required to settle that obligation causing an outflow of economic benefits, and a reliable estimate can
be made of the amount of the obligation.
The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation
at balance sheet date, taking into account the risks, uncertainties and time value of money surrounding the obligation.
When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is
the present value of those cash flows where the effect of the time value of money is material.
When some or all of the economic benefits required to settle a provision are expected to be recovered from a third
party, a receivable is recognized as an asset if it is virtually certain that reimbursement will be received and the
amount of the receivable should not exceed the carrying amount of provisions.
27. Revenue
The Group's revenue is mainly from the following business types:
(1) Port service;
(2) Bonded logistics service
(3) Other business such as property development and investment.
- 54 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
27. Revenue - continued
The Group recognizes revenue based on the transaction price allocated to such performance obligation when a
performance obligation is satisfied, i.e. when "control" of the goods or services underlying the particular performance
obligation is transferred to the customer. A performance obligation represents the commitment that a good and service
that is distinct shall be transferred by the Group to the customer. Transaction price refers to the consideration that the
Group is expected to charge due to the transfer of goods or services to the customer, but it does not include payments
received on behalf of third parties and amounts that the Group expects to return to the customer.
If one of the following criteria is met and it is a performance obligation performed over time, the Group recognizes
the revenue within a certain period of time according to the progress of the performance: (1) the customer
simultaneously receives and consumes the benefits provided by the Group's performance as the Group performs; (2)
the customer is able to control the goods under construction in the course of the Group's performance; (3) the goods
produced by the Group during the performance of the contract are irreplaceable and the Group has the right to charge
for the accumulated part of the contract that has been performed so far during the whole contract period. Otherwise,
the Group recognizes revenue at a certain point in time when "control" of the goods or services is transferred to the
customer.
The Group adopts output method, i.e. the value of goods or services transferred to customers to determine the
appropriate progress of performance. Where the progress cannot be determined reasonably, the revenue is recognized
based on the amount of cost that is expected to be compensated based on the cost already incurred, until the progress
of performance is reasonably determined.
If the contract includes two or more performance obligations, at contract inception, the Group allocates the
transaction price to single performance obligation according to relative proportion of the stand-alone selling prices of
the goods or services promised by single performance obligation. However, where there is conclusive evidence that
the contract discount or variable consideration is only related to one or more (not all) performance obligations in the
contract, the Group shall allocate the contract discount or variable consideration to relevant one or more performance
obligations. The stand-alone selling price is the price at which the Group would sell a promised good or service
separately to a customer. If a stand-alone selling price is not directly observable, the Group shall consider all
information that is reasonably available to the Group and maximize the use of observable inputs and apply estimates
methods consistently in similar circumstances.
For contracts that contain variable consideration (e.g. sales discount), the Group estimates the amount of
consideration using either the expected value or the most likely amount. The transaction price that includes variable
consideration is only to the extent that it is highly probable that such an inclusion will not result in a significant
revenue reversal in the future when the uncertainty is subsequently resolved. At the end of each reporting period, the
Group reevaluates the variable consideration included in the transaction price.
- 55 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
27. Revenue - continued
For non-cash consideration from customer, the Group recognizes the transaction price based on the fair value of the
non-cash consideration. Where the fair value of the non-cash consideration cannot be reasonably estimated, the Group
recognizes the transaction price indirectly by reference to the stand-alone price of the promised goods or services
promised transferred to the customer.
If the contract includes significant financing component, the Group determines the transaction price based on the
amount payable under the assumption that the customer pays that amount payable in cash when "control" of the
goods or services is obtained by the customer. The difference between the transaction price and the contract
consideration shall be amortized within the contract period using effective interest rate. If the Group expects, at
contract inception, that the period between when the Group transfers a promised good or service to a customer and
when the customer pays for that good or service will be one year or less, the Group needs not to consider the
significant financing component.
The Group determines whether it is a principal or an agent at the time of the transaction based on whether it owns the
"control" of the goods or services before the transfer of such goods or services to the customer. The Group is a
principal if it controls the specified good or service before that good or service is transferred to a customer, and the
revenue shall be recognized based on the total consideration received or receivable; otherwise, the Group is an agent,
and the revenue shall be recognized based on the amount of commission or handling fee that is expected to be
charged, and such amount is determined based on the net amount of the total consideration received or receivable
after deducting the prices payable to other related parties or according to the established commission amount or
proportion.
Where payment is received in advance, the advance payment received shall be recorded as a liability and recognized
as revenue when the relevant performance obligation is satisfied. The above amount will be recognized as revenue
proportionately in accordance with the model of contractual rights exercised by the customer if (1) the Group's
advance payment does not need to be returned, (2) the customer may waive all or part of its contractual rights, and (3)
the Group expects to be entitled to the amount related to the contractual rights waived by the customer. Otherwise, the
balance of the liabilities is recognized as revenue by the Group only when the possibility of the customer requesting
the satisfaction of the remaining performance obligations is extremely remote.
28. Contract costs
28.1 Costs to fulfill a contract
If the costs incurred in fulfilling a contract are not within the scope of other standard other than the revenue standard,
the Group shall recognized an asset from the costs incurred to fulfill a contract only if those costs meet all of the
following criteria: (1) the costs relate directly to a contract or to an anticipated contract that the Group can
specifically identify; (2) the costs generate or enhance resources of the entity that will be used in satisfying
performance obligations in the future; and (3) the costs are expected to be recovered. The asset mentioned above shall
be amortized on a basis that is consistent with the transfer to the customer of the goods or services to which the asset
relates and recognized in profit or loss for the period.
- 56 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
28. Contract costs - continued
28.2 Impairment of contract costs
In determination of impairment losses of assets related to contract costs, firstly impairment losses of other assets
related to the contract recognized based on other relevant accounting standards; secondly, the Group shall recognized
an impairment loss to the extent that the carrying amount of an asset exceeds: (1) the remaining amount of
consideration that the Group expects to receive in exchange for the goods or services to which the asset relates; (2)
the estimated costs that relate to providing those goods or services.
The Group shall, after the impairment has been provided, recognized in profit or loss a reversal of some or all of an
impairment loss previously recognized when the impairment conditions no longer exist or have improved. The
increased carrying amount of the asset shall not exceed the carrying amount that would have been determined if no
impairment loss had been recognized previously.
29. Types and accounting treatments of government grants
Government grants are transfer of monetary assets or non-monetary assets from the government to the Group at no
consideration. A government grant is recognized only when the Group can comply with the conditions attached to the
grant and the Group will receive 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.
29.1 Accounting treatment of government grants related to assets
Government grants, such as special funds for modern logistics project and special funds for energy-saving and
emission reduction of transportation, are government grants related to assets as they are all related to the construction
and use of assets.
A government grant related to an asset is recognized as deferred income, and evenly amortized to profit or loss over
the useful life of the related asset.
29.2 Accounting treatment of government grants related to income
The Group's government grant, such as financial support funds of business tax converted to VAT and reward for
energy saving, if used to compensate the related expenses or losses to be incurred in subsequent periods, is
determined to be government grant relating to income.
A government grant relating to income, if used to compensate the related cost, expenses or losses to be incurred in
subsequent periods, is determined as deferred income and recognized in profit or loss over the periods in which the
related costs are recognized; if used to compensate the related cost, expenses or losses already incurred, is recognized
immediately in profit or loss for the period.
- 57 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
29. Types and accounting treatments of government grants - continued
29.2 Accounting treatment of government grants related to income - continued
A government grant relating to the Group's daily activities, is recognized in other income in line with the nature of
economic transaction. A government grant not relating to the Group's daily activities, is recognized in non-operating
income.
30. Deferred tax assets/ deferred tax liabilities
The income tax expenses include current income tax and deferred income tax.
30.1 Current income tax
At the balance sheet date, current income tax liabilities (or assets) for the current and prior periods are measured at
the amount expected to be paid (or recovered) according to the requirements of tax laws.
30.2 Deferred tax assets and deferred tax liabilities
For temporary differences between the carrying amounts of certain assets or liabilities and their tax base, or between
the nil carrying amount of those items that are not recognized as assets or liabilities and their tax base that can be
determined according to tax laws, deferred tax assets and liabilities are recognized using the balance sheet liability
method.
Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets for
deductible temporary differences are recognized to the extent that it is probable that taxable profits will be available
against which the deductible temporary differences can be utilized. However, for temporary differences associated
with the initial recognition of goodwill and the initial recognition of an asset or liability arising from a transaction,
which is not a business combination that affects neither the accounting profit nor taxable profits (or deductible losses)
at the time of transaction, no deferred tax asset or liability is recognized.
For deductible losses and tax credits that can be carried forward, deferred tax assets are recognized to the extent that it
is probable that future taxable profits will be available against which the deductible losses and tax credits can be
utilized.
Deferred tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries
and associates, and interests in joint ventures, except where the Group is able to control the timing of the reversal of
the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.
Deferred tax assets arising from deductible temporary differences associated with such investments and interests are
only recognized to the extent that it is probable that there will be taxable profits against which to utilize the benefits
of the temporary differences and they are expected to reverse in the foreseeable future.
- 58 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
30. Deferred tax assets/ deferred tax liabilities - continued
30.2 Deferred tax assets and deferred tax liabilities - continued
At the balance sheet date, deferred tax assets and liabilities are measured at the tax rates applicable in the period in
which the asset is realized or the liability is settled according to tax laws.
Current and deferred tax expenses or income are recognized in profit or loss for the period, except when they arise
from transactions or events that are directly recognized in other comprehensive income or in equity, in which case
they are recognized in other comprehensive income or in equity, and when they arise from business combinations, in
which case they adjust the carrying amount of goodwill.
At the balance sheet date, the carrying amount of deferred tax assets is reviewed and reduced if it is no longer
probable that sufficient taxable profits will be available in the future to allow the benefit of deferred tax assets to be
utilized. Any such reduction in amount is reversed when it becomes probable that sufficient taxable profits will be
available.
30.3 Income tax offsetting
When the Group has a legal right to settle on a net basis and intends either to settle on a net basis or to realize the
assets and settle the liabilities simultaneously, current tax assets and current tax liabilities are offset and presented on
a net basis.
When the Group has a legal right to settle current tax assets and liabilities on a net basis, and deferred tax assets and
deferred tax liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or
different taxable entities which intend either to settle current tax assets and liabilities on a net basis or to realize the
assets and liabilities simultaneously, in each future period in which significant amounts of deferred tax assets or
liabilities are expected to be reversed, deferred tax assets and deferred tax liabilities are offset and presented on a net
basis.
31. Leases
Lease is a contract that conveys the right to use an asset for a period of time in exchange for consideration.
For contracts that are signed or modified after the date of initial application, at inception/modification of the contracts,
the Group assesses whether the contract is, or contains, a lease. Unless the terms and conditions of the contract are
changed, the Group does not reassess whether a contract is, or contains, a lease.
- 59 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
31. Leases - continued
31.1 The Group as Lessee
31.1.1 Separating components of a lease
If a contract contains a lease component and one or more non-lease components, the Group allocates the
consideration in the contract to each lease component on the basis of the relative stand-alone price of the lease
components and the aggregate stand-alone price of the non-lease components.
31.1.2 Right-of-use assets
Except for short-term leases and leases for which the underlying asset is of low value, at the commencement date of
the lease, the Group recognises a right-of-use assets. The commencement date of the lease is the date on which a
lessor makes an underlying asset available for use by the Group. The Group measures the right-of-use assets at cost.
The cost of the right-of-use assets comprises:
the amount of the initial measurement of the lease liabilities;
any lease payments made at or before the commencement date, less any lease incentives;
any initial direct costs incurred by the Group;
an estimate of costs to be incurred by the lessee in dismantling and removing the underlying
asset, restoring the site on which it is located or restoring the underlying asset to the
condition required by the terms and conditions of the lease.
Right-of-use assets are depreciated by the Group in accordance with the ASBE No.4 Fixed Assets. If the Group is
reasonably certain, that the lease will transfer ownership of the underlying asset to the Group by the end of the lease
term, the right-of-use assets is depreciated from the commencement date to the end of the useful life of the underlying
asset. Otherwise, the right-of-use assets is depreciated from the commencement date to the earlier of the end of the
useful life of the right-of-use assets or the end of the lease term.
The Group applies ASBE No. 8 Impairment of Assets, to determine whether the right-of-use assets are impaired and
to account for any impairment loss identified.
31.1.3 Lease liabilities
Except for short-term leases and leases for which the underlying asset is of low value, at the commencement date of
the lease, the Group measures the lease liabilities at the present value of the lease payments that are not paid at that
date. If the interest rate implicit in the lease cannot be readily determined, the lessee shall use the lessee's incremental
borrowing rate.
The lease payments comprise the following payments by the Group for the right to use the underlying asset during the
lease term:
- 60 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
31. Leases - continued
31.1 The Group as Lessee - continued
31.1.3 Lease liabilities - continued
fixed payments (including in-substance fixed payments), less any lease incentives;
variable lease payments that depend on an index or a rate;
the exercise price of a purchase option if the Group is reasonably certain to exercise that
option;
payments for terminating the lease, if the lease term reflects the Group exercising an option
to terminate the lease;
amounts expected to be payable by the Group under residual value guarantees.
Variable lease payments that depend on an index or a rate, are initially measured using the index or rate as at the
commencement date. Variable lease payments not included in the measurement of the lease liabilities, are recognised
in profit or loss, or in the cost of relevant assets, in the period of those payments.
Interest on the lease liabilities in each period during the lease term is calculated by a constant periodic rate of interest
on the remaining balance of the lease liabilities and recognized in the current profit and loss or the cost of the relevant
assets.
After the commencement date, if one of the following occurs, the lease liability is remeasured by the Group with the
adjustment to the right-of-use asset. If the carrying amount of the right-of-use asset is reduced to zero and there is
further reduction in the measurement of the lease liability, the remaining remeasurement should be recognized in
profit or loss.
there is a change in the lease term, or in the assessment of an option to purchase the
underlying asset, the Group remeasures the lease liabilities, on the basis of the revised lease
term and the revised discount rate;
there is a change in the amounts expected to be payable under a residual value guarantee, or
in future lease payments resulting from a change in an index or a rate used to determine
those payments, the Group remeasures the lease liabilities, on the basis of the revised lease
payments and the unchanged discount rate, unless the change in the lease payments results
from a change in floating interest rates, in which case a revised discount is applied to the
present value.
- 61 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
31. Leases - continued
31.1 The Group as Lessee - continued
31.1.4 Short-term leases and leases for which the underlying asset is of low value
The Group elects not to recognise right-of-use assets or lease liabilities for short-term leases and leases for which the
underlying asset is of low value, i.e. port and terminal facilities, buildings, machinery and equipment, furniture and
fixture and other equipment, motor vehicles and cargo ships, other short-term leases and leases for which the
underlying asset is of low value. A shorts-term lease is a lease that, at the commencement date, has a lease term of 12
months or less. A lease for which the underlying asset is of low value is that, the value of the underlying asset is low
when it is new. For short-term leases and leases for which the underlying asset is of low value, the Group recognises
the lease payments associated with those leases as an expense or cost of relevant asset on a straight-line basis over the
lease term.
31.1.5 Lease modifications
A lease modification should be accounted for as a separate lease if both of the following apply:
the modification increases the scope of the lease by adding the right to use one or more
underlying assets; and
the consideration for the lease increases by an amount commensurate with the stand-alone
price for the increase in scope and any appropriate adjustments to that stand-alone price
according to the circumstances of the particular contract
For a lease medication that is not accounted for as a separate lease, at the effective date of the lease modification, the
Group should allocate the consideration in the modified contract, determine the lease term of the modified lease and
remeasure the lease liability by discounting the revised payments using a revised discount rate.
For lease modifications that decrease the scope of the lease or narrow the term of the lease, the Group should decrease
the carrying amount of the right-of-use asset with any gain or loss relating to the partial or full termination of the
lease should be recognized in profit or loss. For remeasurement of lease liabilities from all other lease modifications,
a corresponding adjustment is made to the carrying amount of the right-of-use asset.
31.2.1 Separating components of a lease
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards
of ownership. All other leases are classified as operating leases.
- 62 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
31. Leases - continued
31.2 The Group as Lessor - continued
31.2.2 Classification of leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards
of ownership. All other leases are classified as operating leases.
31.2.2.1 The Group as lessor under operating leases
The Group recognises lease payments from operating leases as income on a straight-line basis. The Group capitalises
initial direct costs incurred in obtaining an operating lease and recognises those costs as an expense over the lease
term on the same basis as the lease income.
Variable lease receipts relating to an operating lease not included in the lease receipts are recognized in profit or loss
by the Group when incurred.
31.2.2.2 The Group as lessor under finance leases
At the commencement date, the Group recognizes a finance lease receivable at the amount equal to the net investment
in the lease with finance lease assets derecognized. The net investment in the lease is the sum of any unguaranteed
residual value and lease payments receivable from the commencement date, discounted at the interest rate implicit in
the lease.
The amount of the lease payments receivable refers to the amount that the Group should collect from the lessee for
the purpose of transferring the leased assets during the lease term, including:
fixed payments (including in-substance fixed payments) paid by the lessee, less any lease
incentives;
variable lease payments that depend on an index or a rate;
the exercise price of a purchase option, provided that it is reasonably determined that the
lessee will exercise the option;
the lessee exercises the amount to be paid for the termination of the lease option, provided
that the lease term reflects the lessee's exercise of the option to terminate the lease;
the residual value of the guarantee provided by the lessee, the party concerned with the
lessee and the independent third party with the financial ability to perform the guarantee
obligation.
- 63 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
31. Leases - continued
31.2 The Group as Lessor - continued
31.2.2 Classification of leases - continued
31.2.2.2 The Group as lessor under finance leases - continued
Variable payments receivable not included in the net investment in the lease are recognized in profit or loss when
they arise.
Interest income for each period over the lease term is recognized by the Group at the fixed periodic rate.
31.2.3 Subleases
As a lessor of the sublease, the Group accounts for the original lease contract and the sublease contract as two
separate contracts. The Group classifies the subleases based on the right-of-use assets generating from the original
lease rather than the underlying assets of the original lease.
31.2.4 Lease modifications
The Group accounts for a modification to an operating lease as a new lease from the effective date of the modification,
considering any lease advances or receivables relating to the original lease as the lease receipts for the new lease.
The Group should account for a modification to a finance lease as a separate lease if both:
the modification increases the scope of the lease by adding the right to use one or more
underlying assets; and
the consideration for the lease increases by an amount commensurate with the stand-alone
price for the increase in scope with any appropriate adjustment to that stand-alone price
For a modification to a finance lease that is not accounted for as a separate lease, the Group should account for the
modification as follows:
if the lease would have been classified as an operating lease had the modification been effect
at the inception date, the Group should account for the lease modification as a new lease
from the effective date of the modification, and measure the carrying amount of the
underlying asset as the net investment in the lease before the effective date of the lease
modification.
If the lease would have been classified as an operating lease if the modification had been in
effect at the inception date, the Group should apply the requirements of contract
modification and renegotiation under the ASBE No. 22 Financial Instruments: Recognition
and Measurement.
- 64 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
31. Leases - continued
31.2 The Group as Lessor - continued
31.2.5 Sale and leaseback transactions
31.2.5.1 The Group as the seller-lessee
The Group applies the requirements of the revenue standard to determine whether the transfer of an asset is accounted
for as a sale of that asset. If the transfer of an asset does not constitute a sale, the Group should continue to recognize
the transferred assets and should recognize a financial liability equal to the transfer proceeds applying ASBE No. 22
Financial Instruments: Recognition and Measurement. If the transfer of an asset is a sale, the Group should
measure the right-of-use asset arising from the leaseback at the proportion of the previous carrying amount of the
asset that relates to the right of use, and recognize only the amount of any gain or loss that relates to the rights
transferred to the lessor.
32. Exchange of Non-Monetary Assets
Where a non-monetary assets transaction satisfies the following conditions at the same time, it should calculated
based on fair value. The transaction is commercial in nature and the fair value of the assets received or surrendered
can be measured reliably. The fair value of the assets surrendered and relevant payable taxes shall be regarded as the
transaction cost of the assets received. For assets surrendered, the difference between the fair value and the carrying
value of the asset surrendered shall be recorded into the profit or loss of the current period. If any exact evidence
showing that the fair value of the assets received is more reliable, the cost of assets received and surrendered shall be
calculated as different way. For assets received, its cost shall be calculated based on fair value of assets received and
relevant payable taxes. For the assets surrendered, the difference between the fair value of the assets received and the
carrying value of the asset surrendered shall be recorded into the profit or loss of the current period.
Where a non-monetary assets transaction does not meet the conditions as prescribed, the carrying value and relevant
payable taxes of the assets surrendered shall be the cost of the assets received and no profit or loss is recognized.
33. Discontinued Operation
Discontinued operation refers to the separately identifiable components that have been disposed of or classified as
held for sale and meet one of the following conditions: :
(1) The component represents an independent main business or a major business area;
(2) This component is a part of a related plan that intends to dispose an independent main business or a separate
main operating area;
(3) This component is a subsidiary acquired exclusively for resale.
- 65 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
33. Discontinued Operation - continued
Profits or losses from discontinued operations are presented separately in the income statement from continuing
operations. Profits and losses from operations or disposals (e.g. impairment losses and reversals of discontinued
operations) are presented under discontinued operations. For discontinued operations presented in the current period,
the information previously under continuing operations is presented under discontinued operations by the Group in
the financial statements for the comparable accounting period.
34. Safety Production Cost
According to the Administrative Rules on Provision and Use of Enterprise Safety Production Cost jointly issued by
the Ministry of Finance and the State Administration of Work Safety on 14 February 2012 (filed as Cai Qi [2012] No.
16), safety production cost set aside by the Group is directly included in the cost of relevant products or recognized in
profit or loss for the period, as well as the special reserve. When safety production cost set aside is utilized, if the
costs incurred can be categorized as expenditure, the costs incurred should be charged against the special reserve. If
the costs set aside are used to build up fixed assets, the costs should be charged to construction in progress, and
reclassified to fixed assets when the safety projects are ready for intended use. Meantime, expenditures in building up
fixed assets are directly charged against the special reserve with the accumulated depreciation recognized at the same
amount. Depreciation will not be made in the future period on such fixed assets.
35. Critical judgments in applying accounting policies and key assumptions and uncertainties in
accounting estimates
In the application of accounting policies as set out in Note (III), the Company is required to make judgments,
estimates and assumptions about the carrying amounts of items in the financial statements that cannot be measured
accurately, due to the internal uncertainty of the operating activities. These judgments, estimates and assumptions are
based on historical experiences of the Company's management as well as other factors that are considered to be
relevant. Actual results may differ from these estimates.
The Company regularly reviews the judgments, estimates and assumptions on a going concern basis. Changes in
accounting estimates which only affect the current period should be recognized in current period; changes which not
only affect the current but the future periods should be recognized in current and future periods. At the balance sheet
date, key assumptions and uncertainties that are likely to lead to significant adjustments to the book values of assets
and liabilities in the future are:
Goodwill impairment
For the purpose of impairment testing, the present value of the expected future cash flows of the assets group or
portfolio including goodwill shall be calculated, and such expected future cash flows shall be estimated. Meantime, a
pre-tax rate shall be determined that should reflect the time value of money on the current market and the specific
interest risks.
- 66 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
35. Critical judgments in applying accounting policies and key assumptions and uncertainties in
accounting estimates - continued
Recognition of deferred income tax
The Group calculates and makes provision for deferred tax liabilities according to the profit distribution plan of
subsidiaries, associates and the joint ventures subject to the related law. For retained earnings which are not allocated
by the investment company, since the profits will be used to invest the company's daily operation and future
development, no deferred tax liabilities are recognized. If the actually distributed profits in the future are more or less
than those expected, corresponding deferred tax liabilities will be recognized or reversed at the earlier of profits
distribution date and the declaration date, in the profit and loss of the current period.
Deferred tax assets are recognized based on the deductible temporary difference and the corresponding tax rate, to the
extent that it has become probable that future taxable profit will be available for the deductible temporary difference.
If in the future the actual taxable income does not coincide with the amount currently expected, the deferred tax assets
resulting will be recognized or reversed in the period when actually incurred, in profit or loss.
(1) Changes in accounting estimates and reasons
The Proposal on the Change in Accounting Estimates of Depreciation Periods of Certain Fixed Assets is deliberated
and adopted at the 7th session of the 9th Board of Directors and the 7th session of the 9th Board of Supervisor held on
14 April 2020. The Company has reviewed the estimated useful lives of fixed assets based on their current
performance and usage conditions. In order to more objectively and fairly reflect the Group's financial position and
results of operations, the Company has decided to change the accounting estimates for the depreciation periods of
certain fixed assets, with the main adjustments as follows:
1) The depreciation period of port and channel facilities in port and terminal facilities is changed from 40 years
to 40-50 years, and the depreciation period of railway lines is changed from 50 years to 40 years.
2) The depreciation period of civil support facilities in houses and buildings is changed from 10 years to 25
years.
3) The depreciation period of electromechanical equipment in machinery equipment, furniture & fixtures and
other equipment is changed from 5 years to 5 years, 8 years or 10 years.
4) The depreciation period of special operation ships in motor vehicles and cargo ships is changed from 20
years to 18 years, and that of special operation auxiliary ships is changed from 20 years to 20 years.
- 67 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
35. Critical judgments in applying accounting policies and key assumptions and uncertainties in
accounting estimates - continued
Recognition of deferred income tax - continued
(2) Impact of changes in accounting estimates
The above adjustments to depreciation periods of fixed assets are implemented from 1 April 2020.
According to "Accounting Standards for Business Enterprises No. 28 - Changes in Accounting Policies and
Accounting Estimates and Corrections of Errors", the adjustment to the depreciation periods of fixed assets is a
change in accounting estimate, which should be dealt with using the prospective application method without
retrospective adjustment and will not have any impact on the financial position and results of operations of the Group
in previous years.
As a result of the above change in accounting estimates, the Group's depreciation expense of fixed assets increased by
RMB20.29 million, net profit attributable to the parent company decreased by RMB5.19 million and shareholders'
equity attributable to the parent company decreased by RMB5.19 million for the year 2020. The above changes in
accounting estimates have no impact on the Company.
36. Changes in significant accounting estimates
(1) Changes in accounting estimates and reasons
The Proposal on the Change in Accounting Estimates of Depreciation Periods of Certain Fixed Assets is deliberated
and adopted at the 7th session of the 9th Board of Directors and the 7th session of the 9th Board of Supervisor held on
14 April 2020. The Company has reviewed the estimated useful lives of fixed assets based on their current
performance and usage conditions. In order to more objectively and fairly reflect the Group's financial position and
results of operations, the Company has decided to change the accounting estimates for the depreciation periods of
certain fixed assets, with the main adjustments as follows:
1) The depreciation period of port and channel facilities in port and terminal facilities is changed from 40 years
to 40-50 years, and the depreciation period of railway lines is changed from 50 years to 40 years.
2) The depreciation period of civil support facilities in houses and buildings is changed from 10 years to 25
years.
3) The depreciation period of electromechanical equipment in machinery equipment, furniture & fixtures and
other equipment is changed from 5 years to 5 years, 8 years or 10 years.
4) The depreciation period of special operation ships in motor vehicles and cargo ships is changed from 20
years to 18 years, and that of special operation auxiliary ships is changed from 20 years to 20 years.
The above changes in the depreciation periods of fixed assets are within the scope of the Group's
accounting policy on depreciation of fixed assets.
- 68 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
36. Changes in significant accounting estimates - continued
(2) Financial impact of changes in accounting estimates
The above adjustments to depreciation periods of fixed assets are implemented from 1 April 2020.
According to "Accounting Standards for Business Enterprises No. 28 - Changes in Accounting Policies and
Accounting Estimates and Corrections of Errors", the adjustment to the depreciation periods of fixed assets is a
change in accounting estimate, which should be dealt with using the prospective application method without
retrospective adjustment and will not have any impact on the financial position and results of operations of the Group
in previous years.
As a result of the above change in accounting estimates, the Group's depreciation expense of fixed assets increased by
RMB20.29 million, net profit attributable to the parent company decreased by RMB5.19 million and shareholders'
equity attributable to the parent company decreased by RMB5.19 million for the year 2020. The above changes in
accounting estimates have no impact on the Company.
37. Changes in significant accounting policies
(1) Interpretation of the Accounting Standards for Business Enterprises No. 13
On 10 December 2019, the Ministry of Finance issued Interpretation of the Accounting Standards for Business
Enterprises No. 13 in Cai Kuai [2019] File No. 21 (hereinafter referred to as " Interpretation No. 13"). Question 1 of
Interpretation No. 13 further supplemented the Accounting Standards for Business Enterprises No. 36- Related Party
Disclosure and clarified that the following constitute related parties: (1) An enterprise and the joint venture or
associated enterprise of any other member unit of the enterprise group to which the enterprise is affiliated (including
the parent company and subsidiaries); (2) An enterprise's joint venture and the enterprise's any other joint venture or
associated enterprise. Question 2 of Interpretation No. 13 modified the Accounting Standards for Business Enterprises
No. 20 - Business Combinations, which provided the definition of business and added guidance on whether the
processing process is material, and introduced an optional concentration test to simplify the assessment purpose. The
aforesaid provisions have no significant impact on the financial statements of the Group and the Company for 2020.
- 69 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(III) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
37. Changes in significant accounting policies - continued
(2) Provisions on the Accounting Treatment of the COVID-19 Pandemic-related Rental Concessions
On 19 June 2020, the Ministry of Finance issued Provisions on the Accounting Treatment of the COVID-19
Pandemic-related Rental Concessions in Cai Kuai [2020] File No.10 (hereinafter referred to as "File No.10"). It's
specified in File No. 10 that, for rental concessions, provided that certain conditions are satisfied, an enterprise can
conduct accounting treatment according to Accounting Standards for Business Enterprises No. 21—Leases, or adopt
the simplified method specified in File No.10. Where the enterprise adopts the simplified method, it's unnecessary to
assess whether there is lease changes or re-assess the lease classifications. The enterprise shall apply the option to all
the similar lease contracts and shall not change it arbitrarily.
The Group determined to adopt the simplified method for all the rental concessions that fall into the applicable scope.
The relevant rental concessions handled with the simplified method have no impact on the Company's profits and
losses in the current period of 2020, and it's impact on the Group's profits or losses of 2020 is shown as below:
RMB
Item 2020
Operating income -22,310,378.46
Operating cost -293,348.62
Administrative expenses -85,515.23
Non-operating income -4,940,601.35
Income tax expenses -6,320,851.75
Net profit -20,551,264.21
Total comprehensive income -20,551,264.21
(IV) TAXES
1. Major taxes and tax rates
Taxes Tax basis Tax rate
Taxable income 16.5%-34% (Note 1)
Enterprise income tax
Dividend income tax 5%,10%,25% (Note 2)
Income from sale of goods 9%-13%
Income from transportation, loading and unloading business
Value-added Tax 6%
and part of modern service industries
("VAT") (Note 3)
Income from sale of real estate, property management, real
5%
estate lease, etc.
Social contribution tax
Income 0.65%-7.6%
(Note 4)
Deed tax Land use right and property transfer amount 3%-5%
Property tax 70% of cost of property or rental income 1.2% or 12%
City maintenance and
VAT paid 1%-7%
construction tax
Education surtax VAT paid 3%
- 70 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(IV) TAXES - continued
1. Major taxes and tax rates - continued
Note 1: The Group's enterprise income tax is calculated based on the current tax rate stipulated by local tax laws.
Among them, the Company are subject to an enterprise income tax rate of 25%, the subsidiaries set up in
Hong Kong are subject to an enterprise income tax rate of 16.5%, the majority of subsidiaries set up in
China are subject to an enterprise income tax rate of 25% and certain others are subject to the preferential
tax rate for small and micro enterprises of 20%, and the other overseas subsidiaries are subject to
enterprise income tax rates between 28% and 34%.
Note 2: Foreign investors who receive dividends of profits from Chinese subsidiaries in 2008 and thereafter
generally shall pay withholding income tax at a rate of 10% in accordance with the relevant provisions of
the PRC enterprise income tax. For companies incorporated in certain regions (including Hong Kong and
Singapore), if the companies are actual owners holding more than 25% interest in the subsidiaries in China,
they will enjoy a preferential tax rate of 5%.
The Company obtains dividends distributed by overseas subsidiaries and should pay enterprise income tax
at a rate of 25% in accordance with relevant Chinese tax laws. The Company obtains taxable income
outside of China, and the amount of income tax that has been paid abroad can be offset with the current
taxable amount. The credit limit is the taxable amount calculated in accordance with the provisions of the
Enterprise Income Tax Law.
Note 3: The VAT amount is the balance of the output tax less the deductible input tax, and the output tax is
calculated in accordance with the sales income and the corresponding tax rate stipulated in the relevant tax
laws of China.
Note 4: The social contribution tax is the tax paid by the overseas subsidiaries of the Group to the local
government.
2. Tax preference
Some subsidiaries of the Group in China are recognized as high-tech enterprises or encouraged industrial enterprises in
the region and are subject to an enterprise income tax rate of 15%. The Group's subsidiaries outside China may be
subject to enterprise income tax preference in accordance with relevant local tax policies.
The Company and some of its subsidiaries were exempted from paying house property tax and urban land use tax, etc.
for the first quarter of 2020 in accordance with the Notice on the Issuance of Several Measures to Respond to the
COVID-19 Pandemic and Support Enterprises in Weathering Hard Times issued by local people's governments.
- 71 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS
1. Cash and bank balances
Item Closing balance Opening balance
Cash 570,307.93 331,305.65
RMB 31,555.69 122,990.39
USD 146,078.94 55,429.82
HKD 24,653.41 28,354.40
BRL 5,997.01 8,872.81
Others 362,022.88 115,658.23
Bank deposit (Note1) 11,420,083,598.40 7,423,112,193.18
RMB 7,458,567,108.92 4,868,888,181.56
USD 817,495,062.65 1,597,545,919.28
EUR 770,193,517.95 528,103,576.51
BRL 273,701,827.77 310,275,686.79
HKD 2,076,664,153.73 76,041,665.91
AUD 557,797.36 -
Others 22,904,130.02 42,257,163.13
Other cash and bank balances (Note 2) 370,770,828.30 311,504,711.43
RMB 370,726,535.43 311,504,711.43
HKD 44,292.87 -
Total 11,791,424,734.63 7,734,948,210.26
Including: The total amount of funds deposited
5,313,591,920.43 3,511,266,717.03
overseas
Note 1: The bank deposits of the Group deposited overseas and restricted for remittance to China at the end of the
year totalled nil (at the end of the previous year: nil).
Note 2: The structured deposits in other cash and bank balances that can be readily withdrawn on demand at the end
of the year totalled RMB 357,120,261.94, the restricted deposit totalled RMB 11,528,570.90, and the
balance of the securities margin account was RMB 2,121,995.46.
2. Held-for-trading financial assets
Item Closing balance Opening balance
Financial assets at FVTPL 850,165,448.59 -
Including: Debt investment instruments - -
Equity investment instruments 165,448.59 -
Structural deposits 850,000,000.00 -
Total 850,165,448.59 -
- 72 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
3. Notes receivable
(1) Category of notes receivable
Category Closing balance Opening balance
Bank acceptance 745,000.16 13,290,478.02
Commercial acceptance 3,146,994.68 24,901,772.00
Total 3,891,994.84 38,192,250.02
Less: Provision for credit losses (Note) - -
Carrying amount 3,891,994.84 38,192,250.02
Note: The Group believes that the acceptor of its bank acceptance and commercial acceptance have high credit
ratings with no significant credit risks; therefore, no provision for credit loss is made.
(2) As at 31 December 2020, there are no notes receivable pledged.
(3) As at 31 December 2020, there are no notes receivable endorsed or
discounted which are not yet due at the balance sheet date.
(4) As at 31 December 2020, there are no notes reclassified to accounts receivable due to the drawers' inability
to settle the note.
(5) The Group has no notes receivable written off in 2020.
4. Accounts receivable
(1) Accounts receivable disclosed by aging
Closing balance
Aging Accounts Provision for
Proportion (%)
receivable credit loss
Within 1 year 1,329,489,121.52 18,744,736.21 1.41
More than 1 year but not exceeding 2 years 75,815,966.83 16,737,219.64 22.08
More than 2 years but not exceeding 3 years 2,782,945.61 474,387.92 17.05
More than 3 years 39,639,520.65 39,120,974.68 98.69
Total 1,447,727,554.61 75,077,318.45
(2) Disclosure of accounts receivable by categories
Expected Closing balance Opening balance
Credit
credit loss Carrying Provision for Carrying Provision for
rating Book value Book value
rate (%) amount credit loss amount credit loss
A 0.00-0.10 659,544,396.52 301,903.39 659,242,493.13 552,947,162.60 236,251.00 552,710,911.60
B 0.10-0.30 520,087,318.71 639,654.91 519,447,663.80 730,397,420.98 2,106,455.92 728,290,965.06
C 0.30-50.00 207,630,761.65 23,911,382.65 183,719,379.00 70,292,155.38 1,703,501.79 68,588,653.59
D 50.00-100.00 60,465,077.73 50,224,377.50 10,240,700.23 101,658,746.76 94,789,147.11 6,869,599.65
Total 1,447,727,554.61 75,077,318.45 1,372,650,236.16 1,455,295,485.72 98,835,355.82 1,356,460,129.90
- 73 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
4. Accounts receivable - continued
(3) Changes in provision for credit loss of accounts receivable
Lifetime expected Lifetime expected
Item credit loss (not credit loss (credit- Total
credit-impaired) impaired)
At 1 January 2020 4,046,208.71 94,789,147.11 98,835,355.82
Carrying amount of accounts receivable at 1 January 2020
-- Transferred to credit-impaired accounts receivables - - -
-- Reversed to not credit-impaired accounts receivable - - -
Provision for the year 22,198,343.29 12,592,586.51 34,790,929.80
Reversal for the year -870,975.22 -53,139,001.51 -54,009,976.73
Transfer-out from derecognition of financial
- -3,287,015.26 -3,287,015.26
assets(including direct write-down)
Other changes -520,635.83 -731,339.35 -1,251,975.18
At 31 December 2020 24,852,940.95 50,224,377.50 75,077,318.45
(4) Accounts receivable written off in the year
Written-off
Item
amount
Yantai Jinquan International Shipping Agency LLC Shenzhen Branch 289,193.50
Shandong Province Yantai International Marine Shipping Company Shenzhen Branch 2,997,821.76
Total 3,287,015.26
(5) The top five balances of accounts receivable at the end of the year
classified by debtor
Proportion of
the amount to Closing balance
Closing
Name of entity Aging the total of provision for
balance
accounts credit loss
receivable (%)
Within 1 year, more than 1 year but not
Client A 213,605,473.08 exceeding 2 years, more than 2 year but 14.75 213,605.47
not exceeding 3 years, more than 3 years
Client B 78,767,592.24 Within 2 years 5.44 13,358,983.64
Client C 63,238,786.43 Within 1 year 4.37 63,238.79
Client D 56,326,325.71 Within 1 year 3.89 56,326.33
Client E 34,581,743.22 Within 2 years 2.39 5,865,063.65
Total 446,519,920.68 30.84 19,557,217.88
5. Receivables financing
(1) Receivables financing classification
Opening
Items Closing balance
balance
Bank acceptance measured by fair value 217,449,966.41 260,760,537.45
- 74 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
5. Receivables financing - continued
(2) On 31 December 2020, the Group has no pledged receivables financing.
(3) On 31 December 2020, The Group has endorsed or discounted and has not
yet matured the financing of receivables on the balance sheet date.
Closing balance Opening balance
Item
Derecognized Recognized Derecognized Recognized
Bank acceptance measured by fair value 129,866,604.18 - 129,391,886.08 -
6. Prepayments
(1) Aging analysis of prepayment
Closing balance Opening balance
Aging
Amount Proportion (%) Amount Proportion (%)
Within 1 year 48,508,252.83 98.55 50,341,341.46 91.47
More than 1 year but not exceeding 2 years 581,084.82 1.18 4,533,596.99 8.24
More than 2 years but not exceeding 3 years - - - -
More than 3 years 131,512.46 0.27 159,081.36 0.29
Total 49,220,850.11 100.00 55,034,019.81 100.00
(2) As at 31 December 2020, the Group has no significant prepayments aged
more than one year.
(3) The top five balances of prepayments at the end of the year classified
by entities
Proportion of the
Relationship with closing balance to
Name of entity 31 December 2020
the Company the total
prepayments (%)
Saham Assurance Togo S.A. Non-related party 11,437,000.52 23.23
Chubb Seguros Brasil S.A. Non-related party 2,671,202.65 5.43
Uptime Group Non-related party 1,997,591.63 4.06
Fairfax Brasil Seguros Corporativos S.A. Non-related party 1,964,254.53 3.99
CCCC First Harbour Consultants Co.,
Non-related party 1,614,912.75 3.28
Ltd.
Total 19,684,962.08 39.99
7. Other receivables
7.1 Summary of other receivables
Item Closing balance Opening balance
Interest receivable - 159,794.48
Dividend receivable 258,137,208.69 459,352,522.24
Other receivables 3,299,058,252.57 1,669,865,935.78
Total 3,557,195,461.26 2,129,378,252.50
- 75 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
7. Other receivables - continued
7.2 Interest receivable
(1) Classification of interest receivable
Item Closing balance Opening balance
Interest receivable from related parties - 159,954.43
Total - 159,954.43
Less: Provision for credit loss - 159.95
Book value - 159,794.48
(2) As at 31 December 2020, the Group has no significant overdue interest.
7.3 Dividend receivable
(1) Presentation of dividend receivable
Name of investee Closing balance Opening balance
China Nanshan Development (Group) Incorporation ("Nanshan
210,831,000.00 313,435,420.00
Group")
Tin-Can Island Container Terminal Ltd 33,289,037.77 82,625,546.31
Qingdao Qianwan United Container Terminal Co., Ltd. - 50,000,000.00
Others 14,275,566.52 13,751,368.26
Total 258,395,604.29 459,812,334.57
Less: Provision for credit loss 258,395.60 459,812.33
Book value 258,137,208.69 459,352,522.24
(2) Significant dividend receivable aged more than 1 year
Closing balance
Closing
Name of investee Aging Why unrecovered of provision for
balance
credit losses
Undergoing relevant
More than 1 year
formalities and expected to
Nanshan Group 140,554,000.00 but not exceeding 140,554.00
be recovered at the end of
2 years
2021
- 76 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
7. Other receivables - continued
7.3 Dividend receivable - continued
(3) Changes in provision for credit loss of dividends receivable
Stage 1 Stage 2 Stage 3
Lifetime expected Lifetime expected
Item Expected credit Total
credit loss (not credit- credit loss (credit-
loss in 12 months
impaired) impaired)
At 1 January 2020 459,812.33 - - 459,812.33
Carrying amount of dividends receivable at 1 January 2020
--Transfer to Stage 2 - - - -
--Transfer to Stage 3 - - - -
-- Reverse to Stage 2 - - - -
--Reverse to Stage 1 - - - -
Provision for the year - - - -
Reversal for the year -201,416.73 - - -201,416.73
Transfer-out on derecognition of
financial assets( including direct - - - -
write-down)
Other changes - - - -
At 31 December 2020 258,395.60 - - 258,395.60
7.4 Other receivables
(1) Other receivables disclosed by aging
Closing balance
Aging
Other receivables Provision for credit loss Proportion (%)
Within 1 year 2,490,939,969.22 833.00 -
More than 1 year but not exceeding 2 years 966,120,027.06 306,461,787.82 31.72
More than 2 years but not exceeding 3 years 13,122,683.91 81,664.02 0.62
More than 3 years 350,606,928.00 215,187,070.78 61.38
Total 3,820,789,608.19 521,731,355.62
(2) Disclosure of other receivables by nature
Item Closing balance Opening balance
Land compensation (Note 1) 2,742,032,000.00 521,246,000.00
Operation compensation (Note 2) 687,057,815.03 669,121,539.36
Temporary payments 159,559,495.82 334,617,193.32
Compensation for profit or loss on transition 38,312,376.24 35,317,035.66
Deposits 20,162,834.12 21,309,320.77
Others 173,665,086.98 124,618,962.15
Total 3,820,789,608.19 1,706,230,051.26
Less: Provision for credit loss 521,731,355.62 36,364,115.48
Book value 3,299,058,252.57 1,669,865,935.78
- 77 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
7. Other receivables - continued
7.4 Other receivables - continued
(2) Disclosure of other receivables by nature - continued
Note 1: On 5 November 2019, Shantou China Merchants Port Group Co., Ltd. (hereinafter referred to as "Shantou
Port") entered into the Contract for the Acquisition of State-Owned Land Use Rights in Shantou with
Shantou Land Reserve Center. Pursuant to the contract, the land and attached buildings of approximately
370.96 mu located in Zhuchi Deepwater Port on the south of Zhongshan East Road of Shantou should be
returned to Shantou Land Reserve Center by Shantou Port, which is amounting to RMB1,558,032,000.00.
Among them, 183.63 mu of land have been transferred in 2020and attached buildings were transferred in
2019, and the remaining 187.33 mu of land and attached buildings has been transferred in 2020, with the
carrying amount of RMB188,404,228.34 and the consideration of compensation of approximately
RMB786,786,000.00. After deduction of transaction costs, the gains on compensation were recognized in
RMB561,650,519.31. As at 31 December 2020, the land compensation totalling RMB1,208,032,000.00
has not yet been recovered.
On 21 August 2020, Shantou Port entered into the Contract for the Acquisition of State-Owned Land Use
Rights in Shantou with Land Reserve Center of Shantou Haojiang District. Pursuant to the contract, the
land and attached buildings of approximately 152.34 mu located in Yutianwen, Queshi, Haojiang District,
Shantou, should be returned to Land Reserve Center of Shantou Haojiang District by Shantou Port, which
is amounting to RMB250,000,000.00. The transfer of above-mentioned land and attached buildings was
completed before 31 December 2020, with the net book value of RMB163,735,397.39. After deduction of
transaction costs, the gains on compensation were recognized in RMB57,521,085.00. As at 31 December
2020, the land compensation totalling RMB200,000,000.00 has not yet been recovered.
On 22 December 2020, Shantou Port entered into the Contract for the Acquisition of State-Owned Land
Use Rights in Shantou with Shantou Land Reserve Center. Pursuant to the contract, the land and attached
buildings of approximately 648.78 mu located in Zhuchi Deepwater Port of Shantou should be returned to
Shantou Land Reserve Center by Shantou Port, which is amounting to RMB2,724,876,000.00. Among
them, 320 mu of land and attached buildings were transferred by 31 December 2020, with the carrying
amount of RMB356,612,428.85 and the consideration of compensation is RMB1,344,000,000.00. After
deduction of transaction costs, the gains on compensation were recognized in RMB912,690,740.68. As at
31 December 2020, the land compensation totalling RMB1,334,000,000.00 has not yet been recovered,
and the remaining 328.78 mu of land and attached buildings have not been transferred, which are
presented as assets held for sale by the Group.
- 78 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
7. Other receivables - continued
7.4 Other receivables - continued
(2) Disclosure of other receivables by nature - continued
Note 2: It is the operation compensation amounting to RMB687,057,815.03 that the subsidiaries of the Company
should collect from the holding companies of minority shareholders. The aforesaid amount has been
overdue. Therefore, the Group made a corresponding credit impairment loss of RMB477,037,952.97.
(3) Provision for credit loss on other receivables
As part of the Group's credit risk management, the Group conducts internal credit ratings for its customers and
determines the expected loss rate for other receivables for each rating. Such expected average loss rates are based on
actual historical impairments and taking into account the current and future economic conditions.
- 79 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
7. Other receivables - continued
7.4 Other receivables - continued
(3) Provision for credit loss on other receivables - continued
As at 31 December 2020, the credit risk and expected credit loss of other receivables of each category of customers are presented as below:
Closing balance Opening balance
Lifetime
Expected credit Lifetime Lifetime
Credit rating Lifetime expected Expected credit expected
loss rate (%) Expected credit expected credit expected credit
credit loss (credit- Total loss in 12 credit loss Total
loss in 12 months loss (not credit- loss (not credit-
impaired) months (credit-
impaired) impaired)
impaired)
A 0.00-0.10 3,098,532,380.95 - - 3,098,532,380.95 1,669,968,696.05 - - 1,669,968,696.05
B 0.10-0.30 - - - - - - - -
C 0.30-50.00 - - - - - - - -
D 50.00-100.00 - - 722,257,227.24 722,257,227.24 - - 36,261,355.21 36,261,355.21
Account balance 3,098,532,380.95 - 722,257,227.24 3,820,789,608.19 1,669,968,696.05 - 36,261,355.21 1,706,230,051.26
Provision for credit loss 95,128.38 - 521,636,227.24 521,731,355.62 102,760.27 - 36,261,355.21 36,364,115.48
Book value 3,098,437,252.57 - 200,621,000.00 3,299,058,252.57 1,669,865,935.78 - - 1,669,865,935.78
- 80 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
7. Other receivables - continued
7.4 Other receivables - continued
(4) Changes in provision for credit loss of other receivables
Stage 1 Stage 2 Stage 3
Expected credit Lifetime expected Lifetime expected
Item Total
loss in 12 credit loss (not credit loss (credit-
months credit-impaired) impaired)
At 1 January 2020 102,760.27 - 36,261,355.21 36,364,115.48
Carrying amount of other receivables at 1 January 2020
--Transfer to Stage 2 - - - -
--Transfer to Stage 3 -17,528.45 - 17,528.45 -
-- Reverse to Stage 2 - - - -
--Reverse to Stage 1 - - - -
Provision for the year 66,893.25 - 477,037,952.97 477,104,846.22
Reversal for the year -56,996.69 - -1,081,532.21 -1,138,528.90
Transfer-out on derecognition of
financial assets( including direct write- - - - -
down)
Other changes - - 9,400,922.82 9,400,922.82
At 31 December 2020 95,128.38 - 521,636,227.24 521,731,355.62
(5) In the period from 1 January 2020 to 31 December 2020, the Group has no
other receivables written off.
(6) The top five balances of other receivables at the end of the year
classified by debtor
Proportion of the
Provision for credit
amount to the
Name of entity Nature Closing balance Aging loss at the end of
other receivable
the year
(%)
Within 1 year, more
Entity 1 Land compensation 2,542,032,000.00 than 1 year but not 66.53 39,052.09
exceeding 2 years
more than 1 year but not
Operation
Entity 2 687,057,815.03 exceeding 2 years, more 17.98 486,432,815.03
compensation
than 3 years
Entity 3 Land compensation 200,000,000.00 Within 1 year 5.23 3072.51
Entity 4 Temporary payments 57,607,520.00 More than 3 years 1.51 5,760.75
Entity 5 Temporary payments 43,551,875.85 More than 5 years 1.14 4,355.19
Total 3,530,249,210.88 92.39 486,485,055.57
- 81 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
8. Inventories
(1) Categories of inventories
Closing balance Opening Balance
Provision for Provision for
Item Carrying Carrying
decline in value Book value decline in value Book value
amount amount
of inventories of inventories
Raw materials 168,127,613.81 884,061.15 167,243,552.66 147,548,980.01 1,918,890.33 145,630,089.68
Finished goods 31,606,387.22 - 31,606,387.22 4,944,593.66 - 4,944,593.66
Revolving
- - - - - -
materials
Others 12,516,519.00 - 12,516,519.00 13,405,508.74 - 13,405,508.74
Total 212,250,520.03 884,061.15 211,366,458.88 165,899,082.41 1,918,890.33 163,980,192.08
(2) Provision for decline in value of inventories
Decrease
Item 1 January 2020 Provision 31 December 2020
Reversal Write-off
Raw materials 1,918,890.33 - 947,694.12 87,135.06 884,061.15
(3) As at 31 December 2020, the Group has no capitalized borrowing cost in
the balance of inventories.
9. Assets held for sale
Carrying amount Fair value at Estimated disposal
Item Schedule
at closing balance closing balance expenses
Long-term assets held for sale 337,442,757.28 1,380,876,000.00 5,608,306.69 Before 30 June 2021
Less: Provision for
impairment of assets held for -
sale
Carrying amount 337,442,757.28
Note: Refer to Note (V) 7.4(2) for details.
10. Non-current assets due within one year
Item Closing balance Opening balance
Long-term receivables due within one year 67,760,233.67 809,702,715.78
Less: Provision for credit loss 67,760.23 809,702.72
Carrying amount 67,692,473.44 808,893,013.06
- 82 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
11. Other current assets
(1) Categories of other current assets
Item Closing balance Opening balance
Structural deposits 102,749,431.10 2,000,298,176.18
Including: Principal 100,000,000.00 1,991,000,000.00
Interest receivable 2,749,431.10 9,298,176.18
Prepaid taxes 47,556,756.97 31,612,381.68
Others(Note) 283,360,013.35 266,882,103.84
Total 433,666,201.42 2,298,792,661.70
Less: Provision for credit loss - -
Book value 433,666,201.42 2,298,792,661.70
Note: It's mainly the VAT credits of domestic subsidiaries.
12. Long-term receivables
(1) Details of long-term receivables
Closing balance Opening balance
Item Provision for Provision for
Account balance Book value Account balance Book value
credit loss credit loss
Principal and interest of
286,330,144.62 286,330.14 286,043,814.48 1,025,631,435.87 1,025,631.44 1,024,605,804.43
receivables for cooperation
Advances to shareholders (Note) 3,663,271,923.98 3,663,271.92 3,659,608,652.06 869,503,011.54 869,503.01 868,633,508.53
Financing lease deposits 10,000,000.00 10,000.00 9,990,000.00 14,500,000.00 14,500.00 14,485,500.00
Total 3,959,602,068.60 3,959,602.06 3,955,642,466.54 1,909,634,447.41 1,909,634.45 1,907,724,812.96
Less: Long-term receivables
67,760,233.67 67,760.23 67,692,473.44 809,702,715.78 809,702.72 808,893,013.06
due within 1 year
Long-term receivables due over 1
3,891,841,834.93 3,891,841.83 3,887,949,993.10 1,099,931,731.63 1,099,931.73 1,098,831,799.90
year
Note: The addition this year is mainly the payment made by Direct Achieve Investments Limited, a subsidiary of
the Company, for the acquisition of the terminal, on the behalf of its associate, Terminal Link SAS. As at 31
December 2020, the total principal and interest are equivalent to RMB2,797,354,060.41, please refer to Note
(V) 13 for details.
- 83 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
12. Long-term receivables - continued
(2) Provision for credit loss on long-term receivables
Stage 1 Stage 2 Stage 3
Item Lifetime expected credit Total
Expected credit loss Lifetime expected credit
loss (not credit-
in 12 months loss (credit-impaired)
impaired)
At 1 January 2020 1,909,634.45 - - 1,909,634.45
Carrying amount of other current assets at 1 January 2020
--Transfer to Stage 2 - - - -
--Transfer to Stage 3 - - - -
-- Reverse to Stage 2 - - - -
--Reverse to Stage 1 - - - -
Provision for the year 2,791,910.10 - - 2,791,910.10
Reversal for the year -741,942.49 - - -741,942.49
Transfer-out on derecognition of
financial assets( including direct - - - -
write-down)
Other changes - - - -
At 31 December 2020 3,959,602.06 - - 3,959,602.06
(3) As at 31 December 2020, there are no long-term receivables derecognized
due to the transfer of financial assets.
(4) There are no assets and liabilities arising from the transfer or
continuing involvement of long-term receivables at 31 December 2020.
- 84 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
13. Long-term equity investments
Changes for the year
Effect of
Accou Reconciling Closing
Provisi translation of
nting Investment items from Cash dividends or 31 December balance of
Investees 1 January 2020 Other equity on for financial
metho Increase Decrease profit under other profits announced Others 2020 provision for
movements impair statements
d equity method comprehensiv of issuance impairment
ment denominated in
e income
foreign currencies
I. Joint ventures
Equity
Euro-Asia Oceangate S.à r.l. 2,635,767,875.28 - - 71,938,690.26 - - - - - -174,410,003.58 2,533,296,561.96 -
method
Equity
Port of Newcastle 2,199,996,246.66 - - -7,767,864.73 5,561,700.43 - -106,920,517.08 - - 58,179,379.39 2,149,048,944.67 -
method
Qingdao Qianwan United Equity
1,504,764,906.58 - - 102,594,175.95 - - -100,000,000.00 - - - 1,507,359,082.53 -
Container Terminal Co., Ltd. method
Ningbo Daxie Merchants
International Terminals Co., Ltd. Equity
853,995,291.23 - - 112,101,331.18 - 3,703,504.36 - -969,800,126.77 - - - -
(hereinafter referred to as method
"Ningbo Daxie") (Note 1)
Yantai Port Group Laizhou Port
Co., Ltd. (formerly known as Equity
792,062,228.58 - - 24,750,032.44 - - -33,980,174.52 - - - 782,832,086.50 -
"China Overseas Harbour Affairs method
(Laizhou) Co., Ltd.")
Fujian Zhaohang Logistics
Management Partnership (limited Equity
- 450,000,000.00 - 2,283,105.00 - - - - - - 452,283,105.00 -
partnership) ("Zhaohang method
Logistics") (Note 2
Equity
Others 1,405,640,017.89 - - 52,096,085.60 19,869,062.92 -1,978.10 -20,835,178.59 - - -20,844,084.29 1,435,923,925.43 -
method
Subtotal 9,392,226,566.22 450,000,000.00 - 357,995,555.70 25,430,763.35 3,701,526.26 -261,735,870.19 -969,800,126.77 - -137,074,708.48 8,860,743,706.09 -
II. Associates
Shanghai International Port Equity
23,918,042,867.55 - - 2,234,593,249.98 142,216,652.43 -37,597,358.33 -899,371,516.97 - - 3,899,286.75 25,361,783,181.41 -
(Group) Co., Ltd. method
Equity
Nanshan Group 5,090,137,515.66 - - 424,745,838.41 -18,284,905.75 -31,623,552.67 -74,028,000.00 - - - 5,390,946,895.65 -
method
Equity
Terminal Link SAS(Note 3) 4,212,404,575.41 2,746,841,398.03 - 312,427,210.29 -33,697,616.56 - - - - -434,422,522.26 6,803,553,044.91 -
method
Liaoning Port Co., Ltd. (formerly
known as " Dalian Port (PDA) Equity
3,293,260,555.78 - - 169,692,898.03 2,865,701.41 7,108,981.80 -57,009,456.00 - - 40,045,832.60 3,455,964,513.62 621,818,684.80
Company Limited" and renamed method
on 28 January 2021)
Shenzhen China Merchants Qia
Equity
nhai Industrial Development 6,841,066,224.12 - - 335,639,784.43 - - - - - - 7,176,706,008.55 -
method
Co., Ltd.
Ningbo Zhoushan Port Company Equity
- - - - - - - 3,098,292,286.95 - - 3,098,292,286.95 -
Limited (Note 4) method
China Merchants Northeast Asia
Equity
Development & Investment Co., - 1,000,000,000.00 - 7,786,285.71 - - - - - - 1,007,786,285.71 -
method
Ltd. (Note 5)
Equity
Others 5,169,401,078.52 70,665,700.00 -92,584,800.00 146,036,140.53 70,804,284.42 72,409,190.38 -75,291,321.55 - - -285,292,771.74 5,076,147,500.56 -
method
Subtotal 48,524,312,817.04 3,817,507,098.03 -92,584,800.00 3,630,921,407.38 163,904,115.95 10,297,261.18 -1,105,700,294.52 3,098,292,286.95 - -675,770,174.65 57,371,179,717.36 621,818,684.80
Total 57,916,539,383.26 4,267,507,098.03 -92,584,800.00 3,988,916,963.08 189,334,879.30 13,998,787.44 -1,367,436,164.71 2,128,492,160.18 - -812,844,883.13 66,231,923,423.45 621,818,684.80
- 85 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
13. Long-term equity investments - continued
Note 1: Refer to Note (VI) 1 for details.
Note 2: In September 2020, the Company entered into limited partnership agreements with AVIC Trust Co., Ltd.,
Quanzhou Transportation Development Property Investment Co., Ltd etc. Under these agreements, the
Company invested RMB 450 million to participate in the establishment of Zhaohang Logistics. As a
limited partner, the Company can appoint one of the five members of the management committee.
According to the provisions of the limited partnership agreement, Zhaohang Logistics will be controlled
by all the partners jointly.
Note 3: On 25 November 2019, the subsidiary of the Company, China Merchants Port Holdings Company
("CMPort") has signed the shareholders’ agreement with the associate Terminal Link SAS and its
shareholder CMA CGM S.A. According to this agreement, CMPort intends to subscribe for mandatory
convertible bonds of USD468 million and grant a loan facility of USD500 million to Terminal Link SAS
in order to support Terminal Link SAS' acquisition plan of 10 target terminals. On 26 March 2020, the
Company subscribed mandatory convertible bonds, equivalent to RMB2,746,841,398.03. Meanwhile,
Direct Achieve Investments Limited, a subsidiary of the Company, provided a long-term loan to Terminal
Link SAS for the terminal acquisition project and charged interest to Terminal Link SAS at an interest rate
of 6%. As of 31 December 2020, the Company's long-term receivable of aggregate principal and interest
from Terminal Link SAS, equivalent to RMB2,797,354,060.41.
Note 4: The Company acquired 383 million shares of Ningbo Zhoushan Port Company Limited with its own funds
through centralized bidding on the Shanghai Stock Exchange during the year. As of 31 December 2020,
the Company and China Merchants International Terminals (Ningbo) Co., Ltd., a subsidiary of the
Company, held a total of 5% equity interest in Ningbo Zhoushan Port Company Limited and could
appoint one director among the 12 members of the board of directors. Therefore, the Company has
significant influence on Ningbo Zhoushan Port Company Limited And the company would change its
equity investment in Ningbo Zhoushan from other equity instrument investment to long-term equity
investment in associates
Note 5: On 3 April 2020, the Company entered into a joint investment agreement with Liaoning Port Group Co.,
Ltd. and China Merchants Shekou Holdings Co., Ltd., pursuant to which the Company invested RMB1
billion to participate in the establishment of China Merchants Northeast Asia Development & Investment
Co., Ltd., with a 22.22% shareholding, and may appoint one director among the five members of the board
of directors.
- 86 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
14. Investments in other equity instruments
(1) Details of investments in other equity instruments
Investees Closing balance Opening balance
China Ocean Shipping Agency (Shenzhen) Co., Ltd. 144,424,830.00 144,069,435.00
Others 37,042,227.74 19,491,837.00
Total 181,467,057.74 163,561,272.00
(2) Details of non-trading equity instruments
Amounts Why
transferred to transferred to
Dividends income retained retained
Accumulated Why designated as
Item recognized for earnings from earnings from
gains/losses FVTOIC
the year other other
comprehensive comprehensive
income income
The intention of
China Ocean Shipping Agency holding is neither for
7,891,500.00 130,914,830.00 - N/A
(Shenzhen) Co., Ltd. sale nor profits in
short-term
The intention of
holding is neither for
Others 676,750.21 9,199,796.00 - N/A
sale nor profits in
short-term
Total 8,568,250.21 140,114,626.00 -
15. Other non-current financial assets
Item Closing balance Opening balance
Financial assets at FVTPL 910,807,452.56 2,385,363,537.39
Including: Investments in equity instruments 910,807,452.56 2,385,363,537.39
Including: Ningbo Zhoushan Port Co., Ltd. (Note) - 1,548,914,671.20
Qingdao Port International Co., Ltd. 886,385,139.77 820,263,917.11
Others 24,422,312.79 16,184,949.08
Note: Refer to Note (V) 13 for details.
- 87 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
16. Investment properties
(1) Investment properties measured under cost method
Buildings and
Item Land use rights Total
structures
I. Total original carrying amount
1. Balance at 1 January 2020 105,727,492.82 6,291,738,452.02 6,397,465,944.84
2. Increase for the year - 206,574.38 206,574.38
(1) Purchase - 206,574.38 206,574.38
3. Decrease for the year - 13,724,755.35 13,724,755.35
(1) Disposal - 1,071,645.35 1,071,645.35
(2) Transfer to held-for-sale - 12,653,110.00 12,653,110.00
4. Balance at 31 December 2020 105,727,492.82 6,278,220,271.05 6,383,947,763.87
II. Accumulated depreciation and amortisation
1. Balance at 1 January 2020 31,252,512.29 605,950,758.15 637,203,270.44
2.Increase for the year 2,282,103.95 187,672,206.29 189,954,310.24
(1) Provision for the year 2,282,103.95 187,672,206.29 189,954,310.24
3. Decrease for the year - 1,965,092.02 1,965,092.02
(1) Disposal - 489,845.42 489,845.42
(2) Transfer to held-for-sale - 1,475,246.60 1,475,246.60
4. Balance at 1 January 2020 33,534,616.24 791,657,872.42 825,192,488.66
III. Impairment provision
1. Balance at 1 January 2020 - - -
2. Increase for the year - - -
3. Decrease for the year - - -
4. Balance at 31 December 2020 - - -
IV. Book value
1. At 31 December 2020 72,192,876.58 5,486,562,398.63 5,558,755,275.21
2. At 1 January 2020 74,474,980.53 5,685,787,693.87 5,760,262,674.40
(2) Investment properties without ownership certificates
Item Closing balance Opening balance
Buildings, structures, and land use rights 19,256,400.05 40,255,588.09
17. Fixed assets
17.1 Summary of fixed assets
Item Closing balance Opening balance
Fixed assets 29,469,832,876.56 27,519,109,906.41
Disposal of fixed assets 1,750,748.00 852,622.88
Total 29,471,583,624.56 27,519,962,529.29
- 88 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
17. Fixed assets - continued
17.2 Fixed assets
(1) Details of fixed assets
Machinery and
equipment,
Port and terminal Buildings and Motor vehicles
Item furniture and Total
facilities structures and cargo ships
fixture and other
equipment
I. Total original carrying amount
1.Balance at 1 January 2020 26,835,227,578.81 1,619,692,941.54 13,688,077,920.51 2,039,216,861.04 44,182,215,301.90
2.Increase for the year 4,524,798,470.75 369,350,604.72 2,213,225,703.62 164,937,079.91 7,272,311,859.00
(1)Purchase 71,684,688.10 700,802.12 114,357,577.13 13,029,518.26 199,772,585.61
(2)Transfer from development expenditure 1,408,916.16 - - - 1,408,916.16
(3)Transfer from construction in progress 1,754,888,222.69 142,301,793.67 476,726,701.65 106,199,438.61 2,480,116,156.62
(4) Transfer from right-of-use assets - - 307,458,506.08 38,350,000.00 345,808,506.08
(5) Effect of changes in the scope of
2,696,816,643.80 226,348,008.93 1,314,682,918.76 7,358,123.04 4,245,205,694.53
consolidation
3.Decrease for the year 718,395,304.50 47,101,576.44 380,761,375.46 28,965,159.53 1,175,223,415.93
(1) Disposal or retirement 445,859,279.24 15,456,387.45 295,286,035.68 28,965,159.53 785,566,861.90
(2) Transfer to construction in progress 50,622,456.67 31,645,188.99 83,619,288.11 - 165,886,933.77
(3) Transfer to held for sale assets (Note) 221,913,568.59 - 1,856,051.67 - 223,769,620.26
4. Reclassification 33,350,877.05 -84,290,946.10 50,940,069.05 - -
5. Effect of changes in foreign exchange -817,227,476.73 -11,017,342.84 -340,786,841.33 -44,002,772.02 -1,213,034,432.92
6.Balance at 31 December 2020 29,857,754,145.38 1,846,633,680.88 15,230,695,476.39 2,131,186,009.40 49,066,269,312.05
II. Accumulated depreciation
1.Balance at 1 January 2020 7,595,730,173.47 398,455,580.82 7,776,172,621.82 835,082,151.24 16,605,440,527.35
2.Increase for the year 1,717,137,050.23 112,325,736.21 1,917,530,741.07 141,926,361.56 3,888,919,889.07
(1) Provision 834,686,032.22 66,028,685.87 803,408,657.69 107,037,420.27 1,811,160,796.05
(2) Transfer from right-of-use assets - - 170,414,913.99 29,164,345.13 199,579,259.12
(3) Effect of changes in the scope of
882,451,018.01 46,297,050.34 943,707,169.39 5,724,596.16 1,878,179,833.90
consolidation
3.Decrease for the year 344,308,285.21 23,249,291.57 259,760,512.01 27,358,236.10 654,676,324.89
(1) Disposal or retirement 211,350,460.07 4,417,031.71 258,199,762.47 27,358,236.10 501,325,490.35
(2) Transfer to construction in progress 24,461,742.42 18,832,259.86 - - 43,294,002.28
(3) Transfer to held for sale assets (Note) 108,496,082.72 - 1,560,749.54 - 110,056,832.26
4. Reclassification -5,413,861.57 -17,320,060.74 22,733,922.31 - -
5. Effect of changes in foreign exchange -130,349,585.98 -2,208,633.67 -158,886,817.90 -9,330,036.71 -300,775,074.26
6. Balance at 31 December 2020 883,2795,490.94 468,003,331.05 9,297,789,955.29 940,320,239.99 19,538,909,017.27
III. Impairment provision
1. Balance at 1 January 2020 57,419,468.96 - 245,399.18 - 57,664,868.14
2. Increase for the year - - - - -
3. Disposal or retirement for the year - - -137,449.92 - -137,449.92
4. Reclassified amount for the year - 63,906.47 -63,906.47 - -
5. Balance at 31 December 2020 57,419,468.96 63,906.47 44,042.79 - 57,527,418.22
IV. Book value
1. Book value at 31 December 2020 20,967,539,185.48 1,378,566,443.36 5,932,861,478.31 1,190,865,769.41 29,469,832,876.56
2. Book value at 1 January 2020 19,182,077,936.38 1,221,237,360.72 5,911,659,899.51 1,204,134,709.80 27,519,109,906.41
Note: Refer to Note (V) 7.4 for details.
(2) The Group has no fixed assets that are temporarily idle as at 31
December 2020.
- 89 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
17. Fixed assets - continued
17.2 Fixed assets - continued
(3) Fixed assets leased out under operating leases
Book value at 31 Book value at 31
Item
December 2020 December 2019
Buildings and structures 291,567,507.17 312,602,129.37
Port and terminal facilities 79,578,478.13 12,233,139.52
Machinery and equipment, furniture and fixture and
8,646,797.33 63,964.98
other equipment
Commercial housing 4,757,652.18 -
Motor vehicles and cargo ships - 17,754.72
Total 384,550,434.81 324,916,988.59
(4) Fixed assets without ownership certificates
Book value at 31 Book value at 31
Item
December 2020 December 2019
Buildings, structures, port and terminal facilities 1,751,680,587.08 1,652,483,135.07
(5) Other issues
Item Amount Remark
Cost of fixed assets fully depreciated but still in use at
3,939,760,874.98
the end of the year
Cost of fixed assets temporarily idle at the end of the
-
year
Fixed assets disposed and retired in the year
Cost of fixed assets disposed and retired in the year 785,566,861.90
Net value of fixed assets disposed and retired in the
284,103,921.63
year
Loss on disposal or retirement of fixed assets in the
-45,180,168.60
year
17.3 Disposal of fixed assets
Item Closing balance Opening balance
Machinery and equipment, furniture and fixture and
1,216,187.48 848,410.93
other equipment
Motor vehicles and cargo ships 17,000.05 4,211.95
Port and terminal facilities 517,560.47 -
Total 1,750,748.00 852,622.88
- 90 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
18. Construction in progress
18.1 Summary of construction in progress
Item Closing balance Opening balance
Construction in progress 5,366,181,331.72 6,318,389,715.70
Materials for construction of fixed assets 15,249,274.46 15,751,726.18
Total 5,381,430,606.18 6,334,141,441.88
18.2 Construction in progress
(1) Details of construction in progress
Closing balance Opening balance
Item Carrying Provision for Carrying Provision for
amount impairment Book value amount impairment Book value
Port and terminal
4,662,213,617.98 - 4,662,213,617.98 5,713,564,853.28 787,181.96 5,712,777,671.32
facilities
Berths and yards 336,353,712.35 - 336,353,712.35 296,933,093.52 - 296,933,093.52
Infrastructure 197,699,601.64 - 197,699,601.64 175,423,610.37 - 175,423,610.37
Ship under
58,674,526.32 - 58,674,526.32 80,042,167.50 - 80,042,167.50
construction
Others 111,239,873.43 - 111,239,873.43 53,213,172.99 - 53,213,172.99
Total 5,366,181,331.72 - 5,366,181,331.72 6,319,176,897.66 787,181.96 6,318,389,715.70
- 91 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
18. Construction in progress - continued
18.2 Construction in progress - continued
(2) The top ten balances of construction in progress
Proportion of
Interest
accumulated Amount of Including:
Other Effect of changes Constructio capitalizatio
Increase for the Transfer to fixed construction accumulated capitalized
Item Budget amount 1 January 2020 decreases for in foreign 31 December 2020 n progress n rate for Capital source
year assets investment in capitalized interest for the
the year exchange (%) the current
budget interest year
year (%)
(%)
Reconstruction project of container, oil
2,851,020,136.97 1,058,989,758.99 485,237,057.61 - - - 1,544,226,816.60 54.16 54.16 40,818,524.04 35,011,773.08 4.13 Self-funding and loan
terminal and tank area, HIPG
Hydraulic structure engineering for the
reconstruction project of Berth 1# - 4#, 2,639,607,386.75 1,407,055,802.30 143,384,534.55 85,936,753.07 405,379,918.39 -72,157,673.43 986,965,991.96 56.00 56.00 537,530.59 537,530.59 2.55 Self-funding and loan
Haixing Terminal
Phase III project for the bulk grain
warehouses at Berth 2# and 3#, Mayong 620,000,000.00 321,198,858.46 165,851,858.79 - - - 487,050,717.25 78.56 78.56 2,552,884.46 2,535,928.90 4.38 Self-funding and loan
Port Area
General cargo terminal project at Donghai
737,792,300.00 234,308,909.02 230,330,096.08 - - - 464,639,005.10 62.98 62.98 14,018,717.36 11,153,244.13 4.79 Self-funding and loan
Island Port Area of Zhanjiang Port
Universal terminal project at Xiashan Port
905,348,400.00 254,545,729.28 112,037,664.03 - - - 366,583,393.31 40.49 40.49 31,484,883.79 10,995,102.59 4.79 Self-funding and loan
Area of Zhanjiang Port
Phase I reconstruction project for the old
tank area of the Petrochemical Department 218,378,500.00 178,983,632.92 3,485,964.32 - - - 182,469,597.24 83.56 83.56 5,024,262.73 - - Self-funding and loan
of Zhanjiang Port
Phase I expansion project for the container
terminal at Baoman Port Area, Zhanjiang 2,412,810,000.00 155,695,498.79 316,981.13 - - - 156,012,479.92 6.47 6.47 964,740.46 - - Self-funding and loan
Port
Phase I project for the stuffing and
destuffing service area of Baoman Port 606,521,505.83 134,029,761.00 3,045,453.56 - - - 137,075,214.56 22.60 22.60 16,689,500.56 - - Self-funding and loan
Area, Zhanjiang Port
Reconstruction project for Yard 16# of the
120,120,000.00 1,492,394.31 97,845,222.36 - - - 99,337,616.67 82.70 82.70 - - - Self-funding
bulk cargo terminal, Zhanjiang Port
Berth #1 project for Shantou Guang'ao
190,000,000.00 - 68,846,809.70 - - - 68,846,809.70 36.24 36.24 298,799.22 298,799.22 4.79 Self-funding and loan
Port Area
Total 11,301,598,229.55 3,746,300,345.07 1,310,381,642.13 85,936,753.07 405,379,918.39 -72,157,673.43 4,493,207,642.31 112,389,843.21 60,532,378.51
- 92 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
18. Construction in progress - continued
18.3 Materials for construction of fixed assets
Closing balance Opening balance
Item Carrying Provision for Carrying Provision for
amount impairment Book value amount impairment Book value
Materials for construction
15,249,274.46 - 15,249,274.46 15,751,726.18 - 15,751,726.18
of fixed assets
19. Right-of-use assets
(1) Details of right-of-use assets
Machinery and
equipment,
Motor
Port and terminal Buildings and furniture and
Item vehicles and Others Total
facilities structures fixture and
cargo ships
other
equipment
I. Cost
1. Balance at 1 January
6,689,402,526.61 186,206,419.38 767,725,299.95 45,970,740.24 2,846,079,467.04 10,535,384,453.22
2020
2. Increase for the year 484,770,470.31 11,433,840.25 7,672,321.67 - 2,673,929.81 506,550,562.04
(1) Purchase 484,770,470.31 11,433,840.25 7,672,321.67 - 2,673,929.81 506,550,562.04
3. Decrease for the year 23,874,770.86 28,210,371.94 309,391,492.48 38,350,000.00 4,302,156.07 404,128,791.35
(1) Termination of lease 23,874,770.86 28,210,371.94 309,391,492.48 38,350,000.00 4,302,156.07 404,128,791.35
4. Effect of changes in
-377,928,574.94 -8,767,271.15 2,616.89 - -182,308,916.92 -569,002,146.12
foreign exchange
5.Balance at 31 December
6,772,369,651.12 160,662,616.54 466,008,746.03 7,620,740.24 2,662,142,323.86 10,068,804,077.79
2020
II. Accumulated
depreciation
1.Balance at 1 January
378,840,364.31 36,980,701.16 231,571,742.64 30,948,956.19 223,717,298.46 902,059,062.76
2020
2.Increase for the year 238,125,255.25 19,582,502.81 50,762,871.87 1,958,694.54 45,315,531.18 355,744,855.65
(1) Provision 238,125,255.25 19,582,502.81 50,762,871.87 1,958,694.54 45,315,531.18 355,744,855.65
3. Decrease for the year 7,197,030.47 25,070,374.43 172,347,900.39 29,164,345.13 4,159,351.13 237,939,001.55
(1) Termination of lease 7,197,030.47 25,070,374.43 172,347,900.39 29,164,345.13 4,159,351.13 237,939,001.55
4. Effect of changes in
-21,008,481.15 -1,077,275.10 -682,790.90 - -15,508,009.52 -38,276,556.67
foreign exchange
5.Balance at 31 December
588,760,107.94 30,415,554.44 109,303,923.22 3,743,305.60 249,365,468.99 981,588,360.19
2020
III. Impairment provision
1. Balance at 1 January
- - - - - -
2020
2. Increase for the year - - - - - -
3. Decrease for the year - - - - - -
4. Balance at 31 December
- - - - - -
2020
IV. Book value
1. Book value at 31
6,183,609,543.18 130,247,062.10 356,704,822.81 3,877,434.64 2,412,776,854.87 9,087,215,717.60
December 2020
2. Book value at 1 January
6,310,562,162.30 149,225,718.22 536,153,557.31 15,021,784.05 2,622,362,168.58 9,633,325,390.46
2020
- 93 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
19. Right-of-use assets - continued
(2) Amount recognized in profit or loss
Category Amount incurred in the year
Depreciation expenses of right-of-use assets (Note 1) 355,744,855.65
Interest expenses on lease liabilities (Note 2) 99,173,836.07
Expenses for short-term leases 63,007,327.53
Expenses for leases of low value assets 139,397.25
Variable lease payments not included in the measurement of lease liabilities
-
(Note 3)
Revenue from sublease of right-of-use assets 19,006,077.17
Note 1: In 2020, no depreciation expenses of right-of-use assets is capitalized.
Note 2: In 2020, no interest expenses of lease liabilities are capitalized.
Note 3: In 2020, no variable lease payments were included in the measurement of lease liabilities.
(3) The total cash outflows in relation to leases for the current year
amount to RMB 512,864,681.32.
(4) The lease terms of the lease assets of the Group are as follows:
Category Lease term
Port and terminal facilities 1-99 years
Buildings and structures 1-5 years
Machinery and equipment, furniture and fixture and other equipment 1-6 years
Motor vehicles and cargo ships 5 years
Others 1-35 years
(5) The Group has an option to purchase port and terminal facilities,
machinery and equipment and cargo ships at the end of the extension
period at a rate that is below market rates.
- 94 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
20. Intangible assets
(1) Details of intangible assets
Land use rights Terminal
Items Others Total
(Note 2) management rights
I. Total original carrying amount
1.Balance at 1 January 2020 13,324,673,654.68 10,223,755,868.87 1,148,257,126.44 24,696,686,649.99
2.Increase for the year 1,242,316,513.14 103,112,803.75 121,314,553.21 1,466,743,870.10
(1) Purchase 588,985.17 103,112,803.75 61,993,003.31 165,694,792.23
(2) Effect of changes in the scope of
1,241,727,527.97 - 46,191,467.18 1,287,918,995.15
consolidation
(3) Other increase - - 13,130,082.72 13,130,082.72
3.Decrease for the year 621,368,889.28 7,368,180.44 2,304,520.38 631,041,590.10
(1) Disposal 376,891,493.94 - 2,165,163.07 379,056,657.01
(2) Transfer to held-for-sale assets (Note 1) 243,458,641.73 - - 243,458,641.73
(3) Other decrease 1,018,753.61 7,368,180.44 139,357.31 8,526,291.36
4.Effect of changes in foreign
-20,217,599.85 -1,323,287,930.95 -166,921,137.02 -1,510,426,667.82
exchange
5.Balance at 31 December 2020 13,925,403,678.69 8,996,212,561.23 1,100,346,022.25 24,021,962,262.17
II. Accumulated amortization
1.Balance at 1 January 2020 3,161,151,683.32 1,481,484,521.65 360,334,890.92 5,002,971,095.89
2.Increase for the year 326,872,826.32 230,075,828.24 94,373,946.52 651,322,601.08
(1) Provision 310,861,507.98 230,075,828.24 68,603,128.84 609,540,465.06
(2) Effect of changes in the scope of
16,011,318.34 - 25,770,817.68 41,782,136.02
consolidation
(3) Other increase - - - -
3.Decrease for the year 79,084,466.90 - 2,220,063.91 81,304,530.81
(1) Disposal 47,911,526.84 - 2,165,163.07 50,076,689.91
(2) Transfer to held-for-sale assets (Note 1) 30,906,535.82 - - 30,906,535.82
(3) Other decrease 266,404.24 - 54,900.84 321,305.08
4.Effect of changes in foreign
-9,473,349.26 -267,559,789.29 -40,085,929.25 -317,119,067.80
exchange
5.Balance at 31 December 2020 3,399,466,693.48 1,444,000,560.60 412,402,844.28 5,255,870,098.36
III. Impairment provision
1.Balance at 1 January 2020 - - - -
2.Increase for the year - - - -
3.Decrease for the year - - - -
4.Balance at 31 December 2020 - - - -
IV. Book value
1. Book value at 31 December 2020 10,525,936,985.21 7,552,212,000.63 687,943,177.97 18,766,092,163.81
2. Book value at 1 January 2020 10,163,521,971.36 8,742,271,347.22 787,922,235.52 19,693,715,554.10
Note 1: Refer to Note (V) 7.4 for details.
Note 2: The Group obtained the land use rights of berths and yards covering an area of 1,049,946.00 m2 in Chiwan
Port Area from Nanshan Group (the plot is within Chiwan watershed, including a land of 2.2 km2 invested
by the shareholder of Nanshan Group--Shenzhen Investment Holdings Co., Ltd. in Nanshan Group as its
contribution, and the plot formed from marine reclamation by Nanshan Group), whose original cost is
RMB 1,400,288,984.00 and useful life is 20-50 years. Among them, the land use rights for an area of
270,692.00 m2 (whose original cost is RMB 122,623,476.00) were invested Nanshan Group in the
Company as its contribution and the rest land use rights were acquired by the Group from Nanshan Group
through long-term lease.
- 95 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
20. Intangible assets - continued
(1) Details of intangible assets - continued
Note 2: - continued
At present, since Nanshan Group haven't obtained the land use rights of the land within the Chiwan
watershed, including the land provided by Nanshan Group through investment contribution and lease, the
Group cannot obtain the ownership certificates for the relevant land and the buildings and structures on the
aforesaid land.
On 20 March 2001, 18 June 2003, 29 September 2004, and 2 July 2020, Nanshan Group made the
following commitments for all the land use rights that it had obtained on the dates: Nanshan Group will
irrevocably and unconditionally agree that, such land use rights belong to the Group. If the Group suffer
any loss, or shall bear expenses and liabilities, or is subject to any claim for compensation, or is involved
in any lawsuit due to any actual or potential illegality and unenforceability of any land use agreement that
is signed or will be signed by the Group, Nanshan Group undertakes that, the transferees of such land use
rights and their successors shall be sufficiently held harmless. Therefore, the management of the Company
holds that the relevant assets have no significant impairment risk although the relevant ownership
certificates are not obtained and the Group will not have any major contingent liabilities because of that.
The management of the Company has been aware of that Nanshan Group is actively negotiating with the
relevant government authorities about the outstanding issues of the related land. Currently, the date when
the Group can obtain the ownership certificates for the relevant land and buildings and structures on the
land cannot be reliably estimated.
As at 31 December 2020, the lease agreement for the land use rights of 194,293.90 m2 land among the
aforesaid land (the original cost of which is RMB137,749,984.16) has expired.
(2) Land use rights without ownership certificates on 31 December 2020:
Book value at this Book value at last
Item
year end year end
Land use rights 1,051,555,795.12 1,163,098,978.96
- 96 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
21. Development expenses
Decrease in the current year
Increase in the Transfer to Transfer to
Item 1/1/2020 Transfer to 31.12/2020
current year intangible profit or loss
fixed assets
assets for the year
CTOS upgrading - 71,725,843.56 - - 71,725,843.56 -
Development and application of automatic
control systems for heavy oil, diesel, gasoline, 4,834,850.03 14,855,085.10 - - - 19,689,935.13
and methanol processes
"China Merchants Chip" ICT integrated R&D
for the automatic and semi-automatic container - 14,440,326.99 - - 14,440,326.99 -
terminal (subsystem of the Haixing Project)
Customs Clearance Platform for Combined
- 16,886,500.00 - - 16,886,500.00 -
Ports of Shenzhen
The R&D and implementation project for the
"China Merchants Chip" Cloud Smart Platform - 5,021,649.98 - - 5,021,649.98 -
V1.0 (for bulk cargos)
Key technical research for the device used to
15,830,956.74 4,825,168.41 - - - 20,656,125.15
load crude oil to a train
Dust suppression device for bulk grains
- 3,152,932.65 - - 3,152,932.65 -
(RD201904)
Others 16,733,285.51 53,364,165.96 - 1,408,916.16 44,796,860.36 23,891,674.95
Total 37,399,092.28 184,271,672.65 - 1,408,916.16 156,024,113.54 64,237,735.23
22. Goodwill
(1) Carrying amount of goodwill
Amount of
Investee 1/1/2020 Increase Decrease changes in 31/12/2020
foreign exchange
TCP Participaes S.A.
3,546,466,476.18 - - -983,899,222.44 2,562,567,253.74
("TCP")
Mega Shekou Container Terminals
1,815,509,322.42 - - - 1,815,509,322.42
Limited
China Merchants Port Holdings 993,992,000.00 - - - 993,992,000.00
Shantou Port 552,317,736.65 - - - 552,317,736.65
Zhanjiang Port (Group) Co., Ltd.
418,345,307.68 - - - 418,345,307.68
("Zhanjiang Port")
Shenzhen Mawan Project 408,773,001.00 - - - 408,773,001.00
Ningbo Daxie (Note) - 188,497,194.41 - - 188,497,194.41
Others 288,255,850.88 - - - 288,255,850.88
Total 8,023,659,694.81 188,497,194.41 - -983,899,222.44 7,228,257,666.78
Note: The addition in this year represents the goodwill arising from the Group's acquisition of Ningbo Daxie not
under common control in November 2020, as detailed in Note (VI) 1.
(2) Provisions for goodwill impairments
Effect of changes in
Investee 1/1/2020 Increase Decrease 31/12/2020
foreign exchange
Shantou Port - 552,317,736.65 - - 552,317,736.65
- 97 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
22. Goodwill - continued
(3) Information of assets group or portfolio of assets group to which the
goodwill belongs
The Group takes the ability to independently generate cash inflows, manage the way of production and operation
activities (mainly by geographic areas) and unified decision on the use and disposal of the assets as the criteria to
determine assets group or portfolio of assets group, and performs impairment test of goodwill for the assets group or
portfolio of assets group as determined. As at 31 December 2020, the assets group or portfolio of assets group
determined by the Group include: TCP; Mega Shekou Container Terminals Limited, including Shekou Container
Terminals Ltd., Shenzhen Lianyunjie Container Terminals Co., Ltd., Anxunjie Container Terminals (Shenzhen) Co.,
Ltd.; CMPort; Shantou Port; Zhanjiang port; Shenzhen Mawan Project, including Shenzhen Mawan Port Waterway
Co., Ltd., Shenzhen Magang Godown & Wharf Co., Ltd. (hereinafter referred to as "Magang Godown & Wharf");
Ningbo Daxie.
(4) Impairment test of goodwill and key parameters
When testing the goodwill for impairment, the Group compares the carrying amount of related assets group and
portfolio of assets group (including goodwill) with the recoverable amount. If the recoverable amount is less than the
carrying amount, the difference is included in profit or loss for the period. The Group determines the recoverable
amount of the assets group and portfolio of assets group that generate goodwill at fair value less cost of disposal or at
present value of expected future cash flows. The fair value is determined using market approach. The present value
of cash flows is estimated based on the forecast of cash flows for 5 years to 28 years detailed forecast period and
subsequent forecast period. The estimated future cash flows for the detailed forecast period are based on the business
plan established by the management; the expected future cash flows for the subsequent forecast period are determined
in conjunction with the level of the final year of the detailed forecast period, combined with the Group's business
plans, industry trends and inflation rates. The growth rate adopted will not exceed the long-term average growth rate
of the country where the assets group and portfolio of assets group are located. The key assumptions used by the
Group in estimating the present value of future cash flows include growth rate and discount rate etc. The pre-tax
discount rate and the growth rate for subsequent forecasted period adopted in 2020 are around 11.19% - 16.78% and
2.7%-3.0% respectively. The parameters of key assumptions determined by the Group's management are in line with
the Group's historical experience or external source of information.
(5) Effect of impairment test of goodwill
During the year, the Group assessed the recoverable amount of the asset group or set of asset groups which including
the goodwill and determined that the goodwill of Shantou Port was impaired by an amount of RMB552,317,736.65.
- 98 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
23. Long-term prepaid expenses
Effect of
changes in the Increase for the Amortization in
Item 1/1/2020 Other changes 31/12/2020
scope of year the year
consolidation
Tonggu channel widening
525,516,089.84 - - 23,656,287.85 -10,012,815.00 491,846,986.99
project (Note 1)
Relocation project of Nanhai
39,049,767.97 - 1,780,994.09 1,061,913.76 - 39,768,848.30
Rescue Bureau
Expenditures for the
improvement of leased fixed 17,778,884.18 - 1,255,355.00 1,555,016.15 - 17,479,223.03
assets
West public channel
widening project, West port 80,470,088.60 - 161,697,157.65 2,965,546.15 10,012,815.00 249,214,515.10
area (Note 2)
Others 49,096,181.08 9,924,686.56 34,146,022.07 16,243,578.85 -390,411.60 76,532,899.26
Total 711,911,011.67 9,924,686.56 198,879,528.81 45,482,342.76 -390,411.60 874,842,472.68
Note 1: This represent the Group's actual expenses on the Shenzhen Western Port Area Tonggu Channel 210-270
Meters Widening Project. According to relevant resolutions of Shenzhen Municipal Government, the
expenses incurred for the 210-240M widening project are born by the enterprise and government on 60%
to 40% principle, and the expenses incurred for the 240-270M widening project are born by the enterprise
and government on 50% to 50% principle. The Company's subsidiary has included the expenses on
deepening the channel in the item of "long-term prepaid expenses", and amortized such expenses over the
expected useful lives of two widening projects of 35 and 40 years using straight-line method since the
completion of each project in 2008 and 2019, respectively.
Note 2: This represent the Group's actual expenses on the Shenzhen Western Port Area Public Channel Widening
Project, of which the widening of 240-270 meters in the first section was completed on 1 June 2019 and
the widening of 240-270 meters in the second and third sections was completed on 5 November 2020.
According to relevant resolutions of Shenzhen Municipal Government, the expenses incurred for the
project are born by the enterprise and government on 50% to 50% principle. The Company's subsidiary
has included the expenses on deepening the channel in the item of "long-term prepaid expenses", and
amortized such expenses over the expected useful life of 40 years using straight-line method since the
completion of each section of the channel widening project.
- 99 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
24. Deferred tax assets and deferred tax liabilities
(1) Deferred tax assets without offsetting
Closing balance Opening balance
Item Deductible Deductible
temporary Deferred tax assets temporary Deferred tax assets
differences differences
Unrealized profit 782,637,004.71 190,978,844.60 805,528,482.59 196,545,362.77
Depreciation of fixed assets 121,474,197.24 30,363,658.82 108,244,052.41 27,227,981.18
Deductible losses 375,133,696.59 121,834,055.80 79,034,267.56 19,758,566.89
Provision for credit loss 43,779,732.38 11,029,547.41 71,636,378.50 17,881,386.96
Provisions 83,415,919.34 22,408,962.33 60,976,862.88 16,601,394.38
Deferred income 40,760,480.40 9,289,713.04 40,272,757.15 9,737,699.40
Amortization of computer software 11,007,022.11 2,751,755.53 13,630,227.66 3,407,556.91
Organization costs 8,436,714.76 2,109,178.68 10,905,997.08 2,726,499.27
Provision for impairment losses of assets 884,061.15 221,015.29 1,918,890.31 479,722.58
Others 121,790,935.17 29,744,326.80 29,120,031.36 6,069,331.93
Total 1,589,319,763.85 420,731,058.30 1,221,267,947.50 300,435,502.27
(2) Deferred tax liabilities without offsetting
Closing balance Opening balance
Item Taxable temporary Deferred tax Taxable temporary Deferred tax
differences liabilities differences liabilities
Withholding dividend income tax 28,188,540,389.01 1,925,457,143.90 24,219,415,080.67 1,735,339,232.65
Fair value adjustment of assets acquired
8,566,522,113.13 1,925,197,755.69 7,989,044,772.81 1,812,240,254.17
by business combination
Changes in fair value of other non-current
1,625,996,080.95 225,877,441.96 1,434,338,833.65 186,123,245.82
financial assets
Depreciation of fixed assets 826,231,081.71 217,461,491.73 731,584,120.16 166,830,773.03
Changes in fair value of investments in
140,581,630.00 35,145,407.50 140,659,435.00 35,164,858.75
other equity instruments
Others 87,206,887.29 18,413,901.95 110,838,382.96 26,054,384.75
Total 39,435,078,182.09 4,347,553,142.73 34,625,880,625.25 3,961,752,749.17
(3) Deferred tax assets or liabilities that are presented at the net amount
after offsetting
Balance of deferred Balance of deferred
Offset amount of Offset amount of
tax assets or tax assets or
deferred tax assets deferred tax assets
Item liabilities after liabilities after
and liabilities at the and liabilities at the
offsetting at the end offsetting at the end
end of the year end of last year
of this year of last year
Deferred tax assets - 420,731,058.30 - 300,435,502.27
Deferred tax liabilities - 4,347,553,142.73 - 3,961,752,749.17
(4) Details of unrecognized deferred tax assets
Item Closing balance Opening balance
Deductible temporary differences 428,572,235.55 503,037,805.60
Deductible losses 2,512,461,574.84 2,289,500,649.57
Total 2,941,033,810.39 2,792,538,455.17
- 100 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
24. Deferred tax assets and deferred tax liabilities - continued
(4) Details of unrecognized deferred tax assets - continued
The Group recognizes deferred income tax assets to the extent of future taxable income that is likely to be obtained to
offset the deductible temporary differences and deductible losses. For the excess of deductible temporary differences
and deductible losses over future taxable income, no deferred tax assets is recognized.
(5) Deductible losses for unrecognized deferred tax assets will be expired
in the following years:
Year Closing balance Opening balance
2020 - 182,809,604.33
2021 244,394,853.17 244,394,853.17
2022 628,805,890.89 615,440,669.35
2023 793,817,471.45 745,889,729.49
2024 507,534,486.68 500,926,253.51
2025 337,871,725.27 -
No expiration date 37,147.38 39,539.72
Total 2,512,461,574.84 2,289,500,649.57
25. Other non-current assets
Item Closing balance Opening balance
Dachanwan port area Phase II land replacement
916,884,222.49 916,884,222.49
payment (Note 1)
Advances for the channel project (Note 2) 940,472,488.75 896,848,920.76
Prepayments for land use rights 132,334,704.86 132,334,704.86
Prepayments for fixed assets 32,623,333.85 90,186,071.12
Prepayments for terminal franchise 31,113,113.10 30,356,842.78
Others 85,040,820.59 16,354,705.03
Total 2,138,468,683.64 2,082,965,467.04
Note 1: It is the lands located in Shenzhen Qianhaiwan Logistics Park which has been returned to government in
2019 by the Company’s subsidiaries Antongjie Terminal Services (Shenzhen) Co., Ltd. (“ATJ”) and
Ansujie Terminal Services (Shenzhen) Co., Ltd. (“ASJ”). Qianhai Administration replaces 55% land and
corresponding shoreline (with a land area of approximately 531,300 square meters) included in the total
areas of T102-0166 and T102-0167 held by ATJ and ASJ to Dachanwan Port Area Phase II. As at 31
December 2020, the change of land use rights of Dachanwan Port Area Phase II has not been completed.
Note 2: This represent that the Company's subsidiary Zhanjiang Port, upon its reorganization into a joint stock
company in 2007, signed the Channel Arrangement Agreement with State-owned Assets Supervision and
Administration Commission of Zhanjiang ("Zhanjiang SASAC") and China Merchants International
Terminal (Zhanjiang) Co., Ltd. According to the agreement, the channel belongs to Zhanjiang SASAC,
therefore the Group included the advances of channel project that should be repaid by Zhanjiang SASAC
in other non-current assets.
- 101 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
26. Short-term borrowings
(1) Classification of short-term borrowings
Item Closing balance Opening balance
Credit loan 8,976,788,882.26 9,439,099,793.47
Guaranteed loan (Note 1) 1,506,986,666.67 -
Total 10,483,775,548.93 9,439,099,793.47
Note 1: The Company provided guarantee for the loan.
(2) At 31 December 2020, the Group has no short-term borrowings that were
overdue.
27. Notes payable
Category Closing balance Opening balance
Bank acceptance 1,600,100.00 2,529,389.61
Commercial acceptance 5,481,672.32 73,926,559.40
Total 7,081,772.32 76,455,949.01
28. Accounts payable
(1) Details of accounts payable are as follows:
Item Closing balance Opening balance
Service fee 146,212,519.71 133,134,547.67
Construction fee 114,557,864.74 173,811,112.97
Material purchase 144,277,086.08 146,969,853.48
Rental fee 7,494,989.48 13,897,329.66
Equipment payments 16,905,379.88 15,947,499.80
Others 169,664,189.09 107,352,122.81
Total 599,112,028.98 591,112,466.39
(2) Significant accounts payable aged more than one year
Carrying amount at the Reason for outstanding
Name
end of the year or carry-forward
The government planning
project has not been
Shenzhen Land and Resources Bureau 21,642,795.50 completed, and the
ownership certificate is
not handled
- 102 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
29. Receipts in advance
(1) Summary of receipts in advance
Item Closing balance Opening balance
Equity transfer fee received in advance 20,492,849.00 -
Management fee received in advance 10,350,161.96 -
Ship transfer fee received in advance 3,450,560.00 -
Rental fee received in advance 2,715,835.65 13,409,679.80
Service fee received in advance - 10,500,836.06
Others 2,500,721.29 4,916,171.51
Total 39,510,127.90 28,826,687.37
(2) There is no significant receipts in advance aged more than one year at
the end of the year
30. Contract liabilities
(1) Summary of contract liabilities
Item Closing balance Opening balance
Port charges received in advance 78,789,466.29 63,954,147.44
Warehousing fee received in advance 18,460,680.90 -
Service fee received in advance 48,813,245.81 17,396,130.82
Others 1,981,148.70 4,480,724.26
Total 148,044,541.70 85,831,002.52
(2) There was no significant change in the book value of contract
liabilities during the year.
(3) There is no significant contract liabilities aged more than one year at
the end of the year.
(4) Qualitative and quantitative analysis of contract liabilities
The contract liability mainly represents the amount received by the Group to provide port services to customers. The
payment is collected according to the contractual payment time. The Group recognizes contract revenue based on the
progress of the contract. The contract liabilities will be recognized as income after the Group fulfills its performance
obligations.
- 103 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
30. Contract liabilities - continued
(5) Revenue recognized in the year and included in the carrying amount of
contract liabilities at the beginning of the year
An amount of RMB 70,660,631.25 included in the book value of contract liabilities at the beginning of 2020 has
been recognized as revenue in the current year, including contract liabilities arising from settled but unfinished
construction resulting from the contract of receipt of service fee in advance amounting to RMB 5,296,400.84,
contract liabilities arising from settled but unfinished construction resulting from the contract of receipt of port
charges in advance amounting to RMB 61,515,581.17 , and contract liabilities arising from settled but unfinished
construction resulting from other contracts amounting to RMB 3,848,649.24.
31. Employee benefits payable
(1) Employee benefits payable
Effect of changes
Increase in the Decrease in the
Item 1/1/2020 in the scope of 31/12/2020
current year current year
consolidation
1. Short-term benefits 630,356,614.44 42,603,096.98 2,683,167,538.71 2,649,640,006.43 706,487,243.70
2. Post-employment benefits -
5,015,323.78 1,908,108.13 165,280,891.31 165,986,638.38 6,217,684.84
defined contribution plan
3. Termination benefits - - 24,658,398.01 24,658,398.01 -
4. Other benefits due within a
- - 4,387,916.25 4,387,916.25 -
year
5. Others -653,153.58 -3,982.30 4,751,405.94 4,713,576.45 -619,306.39
Total 634,718,784.64 44,507,222.81 2,882,246,150.22 2,849,386,535.52 712,085,622.15
(2) Short-term benefits
Effect of changes
Increase in the Decrease in the
Item 1/1/2020 in the scope of 31/12/2020
current year current year
consolidation
I. Wages and salaries, bonuses, 604,864,369.83 39,288,352.03 2,221,370,860.93 2,191,143,734.26 674,379,848.53
allowances and subsidies
II. Staff welfare - - 126,699,782.20 126,699,782.20 -
III. Social insurance charges 9,636,773.03 2,788,350.45 129,801,742.05 126,132,738.79 16,094,126.74
Including: Medical insurance 8,317,044.95 2,750,575.62 105,632,132.49 101,834,602.65 14,865,150.41
Work injury - 6,287.60 9,007,542.06 9,007,571.52 6,258.14
insurance
Maternity - 31,487.23 6,094,575.77 6,095,261.41 30,801.59
insurance
Others 1,319,728.08 - 9,067,491.73 9,195,303.21 1,191,916.60
IV. Housing funds - -454,068.00 156,097,308.32 156,133,562.21 -490,321.89
V. Labor union and employee 15,855,471.56 980,462.50 40,068,412.17 40,400,755.91 16,503,590.32
education funds
VI. Other short-term benefits 0.02 - 9,129,433.04 9,129,433.06 -
Total 630,356,614.44 42,603,096.98 2,683,167,538.71 2,649,640,006.43 706,487,243.70
- 104 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
31. Employee benefits payable - continued
(3) Defined contribution plan - continued
Effect of changes
Increase in the Decrease in the
Item 1/1/2020 in the scope of 31/12/2020
current year current year
consolidation
I. Basic pension 4,900,268.87 1,912,600.29 82,978,065.44 83,677,975.96 6,112,958.64
II. Unemployment insurance 0.01 64,354.90 1,260,949.37 1,261,276.04 64,028.24
III. Enterprise annuity 115,054.90 -68,847.06 81,041,876.50 81,047,386.38 40,697.96
Total 5,015,323.78 1,908,108.13 165,280,891.31 165,986,638.38 6,217,684.84
The Company and its subsidiaries participates in the social security contributions and the unemployment insurance
plan established by government institutions as required. According to such plans, the Group contributes in proportion
to the local government. Except for the above-mentioned deposit fees, the Group have no outstanding contributions to
be paid to the social security contributions and the unemployment insurance plan. The corresponding expenses are
included in the current profit and loss or the cost of related assets when incurred.
32. Taxes payable
Item Closing balance Opening balance
Enterprise income tax 2,319,560,340.66 1,843,381,355.01
VAT 12,385,746.69 11,377,223.08
Other taxes 36,716,469.02 43,317,764.65
Total 2,368,662,556.37 1,898,076,342.74
33. Other payables
(1) Summary of other payables
Item Closing balance Opening balance
Interest payable - -
Dividends payable 54,255,854.79 150,286,550.81
Other payables 2,402,445,042.81 2,073,468,127.15
Total 2,456,700,897.60 2,223,754,677.96
(2) Dividends payable
Item Closing balance Opening balance
Ordinary share dividends 54,255,854.79 150,286,550.81
Including: Sri Lanka Ports Authority 34,255,854.79 31,392,997.47
China Merchants Zhangzhou Development
20,000,000.00 -
Zone Co., Ltd.
Yihai Kerry Golden Arowana Cereals, Oils
- 37,402,426.09
and Foodstuffs Co., Ltd.
Soifer Participaes Societárias S.A. - 14,141,088.03
Pattac Empreendimentos e Participaes
- 4,597,020.40
S.A.
Tuc Participacoes Portuarias S.A. - 4,597,018.82
Modern Terminals Limited - 58,156,000.00
As at 31 December 2020, the Group has no dividend payable with aging over one year.
- 105 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
33. Other payables - continued
(3) Other payables
(a) Disclosure of other payables by nature
Item Closing balance Opening balance
Amount payable for construction and quality warranty 1,044,197,364.04 1,053,340,753.66
Deposits 359,957,933.44 162,460,889.01
Customer discount 119,368,121.44 117,736,418.62
Prepaid expenses 229,817,005.45 110,741,377.48
Port construction and security fee 55,085,280.96 58,732,330.62
Balance of land use rights transfer 11,295,700.00 14,538,738.00
Others 582,723,637.48 555,917,619.76
Total 2,402,445,042.81 2,073,468,127.15
(b) Significant other payables with aging over 1 year
Company name Closing balance Reason for outstanding or carry-forward
Transport Commission of Shenzhen Municipality 60,152,353.49 To be paid upon confirmation by both parties
The contracted settlement condition has not been
China First Metallurgical Group Co., Ltd. 47,280,549.63
reached
Wuxi Huadong Heavy Machinery Co., Ltd. 44,295,045.47 To be paid upon confirmation by both parties
Shanghai Zhenhua Heavy Industries Co., Ltd. 35,382,190.55 To be paid upon confirmation by both parties
The contracted settlement condition has not been
CCCC Fourth Harbor Engineering Co., Ltd. 34,845,078.73
reached
Shantou Transportation Bureau 31,358,355.47 To be paid upon confirmation by both parties
The contracted settlement condition has not been
CCCC-FHDI Engineering Co.,Ltd. 21,878,790.74
reached
Qingdao Maritime Bureau 20,713,982.12 To be paid upon confirmation by both parties
Zhanjiang Transportation Bureau 17,524,972.24 To be paid upon confirmation by both parties
The contracted settlement condition has not been
Suhua Construction Group Co., Ltd. 14,483,683.52
reached
Quality warranty, the contracted settlement condition
China Merchants Real Estate (Shenzhen) Co., Ltd. 14,305,122.78
has not been reached
The contracted settlement condition has not been
CCCC Third Harbor Engineering Co., Ltd. 12,663,285.33
reached
Shenzhen Municipal Special Fund for Development of
12,238,226.14 To be paid upon confirmation by both parties
Bulk Cement
Shantou Finance Bureau 10,000,000.00 To be paid upon confirmation by both parties
Jiangmen Southern Transport Machinery Engineering The contracted settlement condition has not been
7,890,163.70
Co., Ltd. reached
The contracted settlement condition has not been
Harman Technology (Shenzhen) Co., Ltd. 5,917,392.48
reached
Total 390,929,192.39
- 106 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
34. Non-current liabilities due within one year
Item Closing balance Opening balance
Long-term loans due within one year 2,074,906,728.26 2,954,701,198.90
Including: Credit loan 749,046,479.86 1,294,054,756.85
Guaranteed loan 739,805,701.02 1,119,153,332.94
Mortgage loan 586,054,547.38 541,493,109.11
Bonds payable due within one year 1,042,773,072.37 1,889,505,167.46
Long-term payable due within one year 3,562,994.44 61,107,722.82
Long-term employee benefits payable due within one
36,811,951.00 31,950,000.00
year
Lease liabilities due within one year 322,827,694.67 341,240,327.95
Other non-current liabilities due within one year 83,582,696.63 825,835,439.66
Total 3,564,465,137.37 6,104,339,856.79
35. Other current liabilities
Item Closing balance Opening balance
Short-term bonds payable 2,215,478,001.40 712,345,315.07
Accrued professional agency fee 138,158,158.51 143,346,356.53
Others 30,032,826.03 30,264,910.03
Total 2,383,668,985.94 885,956,581.63
- 107 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
35. Other current liabilities - continued
Changes of short-term bonds payable:
Amount issued Interest Amortization of
Term of the Repayment in
Name of bond Face value Date of issue Amount of issue 1/1/2020 in the current accrued based premiums or 31/12/2020
bond the current year
year on par value discounts
1.50% RMB 1.3 billion Super &
1,300,000,000.00 29/4/2020 180 days 1,300,000,000.00 - 1,300,000,000.00 9,616,438.36 - 1,309,616,438.36 -
Short-term Commercial Paper
1.99% RMB1 billion Super &
1,000,000,000.00 5/6/2020 270 days 1,000,000,000.00 - 1,000,000,000.00 11,418,032.80 - - 1,011,418,032.80
Short-term Commercial Paper
2.50% RMB700 million Super &
700,000,000.00 26/2/2020 266 days 700,000,000.00 - 700,000,000.00 12,718,579.23 - 712,718,579.23 -
Short-term Commercial Paper
3.08% RMB700 million Super &
700,000,000.00 4/6/2019 270 days 700,000,000.00 712,345,315.07 - 3,559,602.96 - 715,904,918.03 -
Short-term Commercial Paper
2.50% RMB1.2 billion Super &
1,200,000,000.00 13/11/2020 180 days 1,200,000,000.00 - 1,200,000,000.00 4,059,968.60 - - 1,204,059,968.60
Short-term Commercial Paper
Total 4,900,000,000.00 4,900,000,000.00 712,345,315.07 4,200,000,000.00 41,372,621.95 - 2,738,239,935.62 2,215,478,001.40
- 108 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
36. Long-term borrowings
(1) Classification of long-term borrowings
Item Closing balance Opening balance
Credit borrowings 5,258,127,800.86 3,368,772,302.71
Guaranteed borrowings (Note 1) 1,629,960,889.64 2,857,916,427.60
Mortgage borrowings (Note 2) 2,593,140,731.56 3,041,748,008.91
Total 9,481,229,422.06 9,268,436,739.22
Less: Long-term borrowings due within one year 2,074,906,728.26 2,954,701,198.89
Including: Credit borrowings 749,046,479.86 1,294,054,756.85
Guaranteed borrowings 739,805,701.02 1,119,153,332.93
Mortgage borrowings 586,054,547.38 541,493,109.11
Long-term borrowings due after one year 7,406,322,693.80 6,313,735,540.33
During the year, the annual interest rate of the borrowing ranges from 1.20% to 5.78%.
Note 1: The loan was guaranteed by Shenzhen Magang Godown & Wharf Co., Ltd., China Merchants Port Service
(Shenzhen) Co., Ltd, and CMPort.
Note 2: As at 31 December 2020, the Group obtained the long-term loan of RMB 2,593,140,731.56 (31 December
2019: RMB 3,041,748,008.91) with its entire equity in Colombo International Container Terminals
Limited (hereinafter referred to as "CICT"), and the entire equity in Thesar Maritime Limited, (hereinafter
referred to as "TML"), and the land use rights, fixed assets and construction in progress held by
Guangdong Yide Port Co., Ltd. (hereinafter referred to as "Yide Port"), the land use rights of Shenzhen
Haixing Harbor Development Co., Ltd. (hereinafter referred to as "Shenzhen Haixing"), as well as the
sea area use rights of Dongguan Chiwan Port Service Co., Ltd. (hereinafter referred to as "Chiwan Port"),
mortgaged as collaterals.
Details of mortgage borrowings are as follows:
Opening
Company name Closing balance Collateral
balance
The Group's entire equity in Colombo
China Development Bank Corporation 1,027,981,472.96 1,358,129,654.07
International Container Terminals Limited
International Finance Corporation 364,480,624.59 449,103,214.20
African Development Bank 167,372,490.13 206,294,203.06
Nederlandse Financierings-Maatschappij voor
137,905,387.30 169,887,745.22
Ontwikkelingslanden N.V.
The Group's entire equity in Thesar Maritime
The Opec Fund For International Development 118,146,703.89 145,656,886.91
Limited
Societe de Promotion et de Participation pour
118,218,277.06 145,613,216.49
la Cooperation Economique S.A.
Deutsche Investitions-und
98,452,963.64 121,392,394.29
Entwicklungsgesellschaft MBH
Land use rights of Shenzhen Haixing Harbor
Bank of China Qianhai Shekou Branch 241,370,822.05 241,388,867.03
Development Co., Ltd (see note (V) 63)
Land use rights, fixed assets and construction in
China Construction Bank Shunde Branch 210,178,757.55 184,264,872.07
progress of Yide Port (see note (V) 63)
Sea area use rights of Dongguan Chiwan Warf
China Merchants Bank Dongguan Branch 109,033,232.39 20,016,955.57
Co., Ltd. (see note (V) 63)
Total 2,593,140,731.56 3,041,748,008.91
- 109 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
37. Bonds payable
(1) Bonds payable
Item Closing balance Opening balance
4.375%, USD 900 million corporate bond 5,948,107,858.02 6,349,018,876.27
5.000%, USD 600 million corporate bond 3,950,488,734.13 4,218,874,981.43
4.750%, USD 500 million corporate bond 3,314,305,348.22 3,541,255,065.51
5.000%, USD 500 million corporate bond 3,280,606,167.04 3,500,281,169.59
4.890% RMB 2.5 billion corporate bond 2,585,407,534.25 2,585,072,602.74
3.360% RMB 2 billion corporate bond 2,033,040,000.00 -
IPCA + 7.8164% BRL428 million corporate bond 620,162,618.74 810,150,534.24
4.980% RMB 400 million corporate bond 401,200,657.53 401,200,657.53
3.500% USD 200 million corporate bond - 1,414,333,247.34
Total 22,133,318,917.93 22,820,187,134.65
Less: Bonds payable due within one year 1,042,773,072.37 1,889,505,167.46
Bonds payable due after one year 21,090,545,845.56 20,930,681,967.19
- 110 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
37. Bonds payable - continued
(2) Changes of bonds payable
Amount issued Interest accrued Amortization of
Term of Repayment in Effect of changes
Name of bonds Face value Date of issue Amount of issue 1/1/2020 in the current based on par premiums or 31/12/2020
the bond the current year in foreign exchange
year value discounts
4.375%, USD 900 million
USD 900,000,000.00 2018-8-6 5 years USD 900,000,000.00 6,349,018,876.27 - 271,646,628.75 10,416,483.30 271,646,628.75 -411,327,501.55 5,948,107,858.02
corporate bond
5.000%, USD 600 million
USD 600,000,000.00 2018-8-6 10 years USD 600,000,000.00 4,218,874,981.43 - 206,968,860.00 4,815,463.94 206,968,860.00 -273,201,711.24 3,950,488,734.13
corporate bond
4.750%, USD 500 million
USD 500,000,000.00 2015-8-3 10 years USD 500,000,000.00 3,541,255,065.51 - 163,850,347.57 2,259,134.10 163,850,347.50 -229,208,851.46 3,314,305,348.22
corporate bond
5.000%, USD 500 million
USD 500,000,000.00 2012-5-4 10 years USD 500,000,000.00 3,500,281,169.59 - 172,474,050.00 6,760,030.70 172,474,050.00 -226,435,033.25 3,280,606,167.04
corporate bond
4.890% RMB 2.5 billion
RMB 2,500,000,000.00 2017-4-21 5 years RMB 2,500,000,000.00 2,585,072,602.74 - 122,584,931.51 - 122,250,000.00 - 2,585,407,534.25
corporate bond
3.360% RMB2
RMB 2,000,000,000.00 2020-7-8 3 years RMB 2,000,000,000.00 - 2,000,000,000.00 33,040,000.00 - - - 2,033,040,000.00
billioncorporate bond
IPCA + 7.8164% BRL428 5 years/6
BRL 428,047,000.00 2016-11-7 BRL 428,047,000.00 810,150,534.24 - 88,607,823.56 9,446,052.30 56,605,942.56 -231,435,848.80 620,162,618.74
million corporate bond years
4.980% RMB 400 million
RMB 400,000,000.00 2018-12-10 3 years RMB 400,000,000.00 401,200,657.53 - 19,920,000.00 - 19,920,000.00 - 401,200,657.53
corporate bond
3.500% USD 200 million
USD 200,000,000.00 2015-8-3 5 years USD 200,000,000.00 1,414,333,247.34 - 28,573,196.35 1,230,286.37 1,428,085,134.00 -16,051,596.06 -
corporate bond
Total 22,820,187,134.65 2,000,000,000.00 1,107,665,837.74 34,927,450.71 2,441,800,962.81 -1,387,660,542.36 22,133,318,917.93
Less: Bonds payable due
1,889,505,167.46 1,042,773,072.37
within one year
Bonds payable due after one
20,930,681,967.19 21,090,545,845.56
year
- 111 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
38. Lease liabilities
Category Closing balance Opening balance
Lease payment 2,452,042,889.87 2,934,104,267.67
Unrecognized financing cost -801,791,447.15 -945,733,971.11
Total 1,650,251,442.72 1,988,370,296.56
Less: Lease liabilities due within one year 322,827,694.67 341,240,327.95
Lease liabilities due after one year 1,327,423,748.05 1,647,129,968.61
39. Long-term payables
(1) Summary of long-term payables
Item Closing balance Opening balance
Long-term payables 1,192,028,415.01 1,447,802,228.74
Special payables 39,996,153.12 548,550,497.29
Total 1,232,024,568.13 1,996,352,726.03
Less: Long-term payables due within one year 3,562,994.44 61,107,722.82
Long-term payables due after one year 1,228,461,573.69 1,935,245,003.21
(2) Long-term payables
Item Closing balance Opening balance
Terminal management rights (Note 1) 749,658,074.16 881,239,309.85
Payable to Minority shareholder of subsidiary (Note 2) 437,238,325.33 407,092,971.69
Borrowings from related parties (Note 3) - 150,000,000.00
Others 5,132,015.52 9,469,947.20
Total 1,192,028,415.01 1,447,802,228.74
Less: Long-term payables due within one year 3,562,994.44 61,107,722.82
Long-term payables due after one year 1,188,465,420.57 1,386,694,505.92
Note 1: As at 12 August 2011, the Group reached a 35-year building, operation and transfer agreement through the
subsidiary Colombo International Container Terminals Limited and the Sri Lanka Port Authority on the building,
operation, management and development of the Colombo Port South Container Terminal (hereinafter referred to as
for "BOT"). The above-mentioned terminal operating rights purchase amount is determined by discounting the
amount to be paid in the future using the prevailing market interest rate according to the BOT agreement. As at 31
December 2020, the amount is RMB 749,658,074.16.
Note 2: It is an unsecured loan from minority shareholder of Thesar Maritime Limited, a subsidiary of the Company,
with an annual interest rate of 4.65%.
- 112 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
39. Long-term payables - continued
(2) Long-term payables - continued
Note 3: At 9 December 2019, Xiamen Bay Port Affairs (hereinafter referred to as "ZCMG"), a subsidiary of the
Company, and China Merchants Finance Lease (Tianjin) Co., Ltd. entered into a 72-month sale-and-
leaseback agreement in respect of the sale-and-leaseback assets, with a consideration of RMB
150,000,000.00. ZCMG is the seller and lessee of the leased assets. As China Merchants Finance Lease
(Tianjin) Co., Ltd. has no control over the leased assets, the transfer of assets in the sale-and-leaseback
transaction is not a sale and the cash receipts are accounted for as financial liabilities, i.e. borrowings from
related parties. According to the agreement, the interest rate for the borrowings is 4.75% and the
borrowing period is 72 months. ZCMG have repaid the aforesaid borrowings in July 2020.
(3) Special payables
Effect of
Increase in the changes in the Decrease in the
Item 1/1/2020 31/12/2020 Reason
current year scope of current year
consolidation
Refunds of port
545,346,468.32 - - 511,074,910.02 34,271,558.30 Note 1
construction fee
Employee housing
3,204,028.97 648,796.63 - - 3,852,825.60 Note 2
fund
Innovation workshop
- 773,274.28 1,098,494.94 - 1,871,769.22
for model workers
Total 548,550,497.29 1,422,070.91 1,098,494.94 511,074,910.02 39,996,153.12
Note 1: This represents the refund of the construction fee received by the Group from the Ministry of Transport,
Shenzhen Municipal Transportation Bureau. According to the "Port Construction Fee Management
Measures" promulgated by the Ministry of Finance, this payment is dedicated to the construction of water
transport infrastructure. The decrease in the year is mainly caused by the transfer of port construction fee
refund for the Company's subsidiary Zhanjiang Port, amounting to RMB510,107,118.35, to capital reserve.
Note 2: This represent the repairing fund for public areas and public facilities and equipment established after the
Group's selling the public-owned house on the collectively allocated land to employees. The fund is
contributed by all the employees having ownership of the house according to the rules, and is specially
managed and used for specific purpose.
- 113 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
40. Long-term employee benefits payable
(1) Long-term employee benefits payable
Item Closing balance Opening balance
Post-employment benefits - net liabilities of defined benefits plan 429,830,989.42 454,383,940.25
Termination benefits 40,939,305.56 49,048,198.38
Others (Note) 73,756,355.48 -
Total 544,526,650.46 503,432,138.63
Less: Long-term employee benefits payable due within one year 36,811,951.00 31,950,000.00
Long-term employee benefits payable due after one year 507,714,699.46 471,482,138.63
Note: It's the employee setting cost of the Company's subsidiary Shantou Port in connection with land acquisition
and reservation.
(2) Changes of defined benefits plan
Present value of defined benefits plan obligation:
Item 2020 2019
I. Opening balance 454,383,940.25 385,323,310.21
II. Defined benefits cost included in profit or loss for 25,714,051.83
35,512,520.40
the period
1. Current service cost 19,803,282.73 10,244,780.50
2. Past service cost - -180,000.00
3. Interest adjustment 15,709,237.67 15,649,271.33
III. Defined benefits cost included in other -1,513,131.31
-35,245,220.38
comprehensive income
1. Actuarial gains (losses) -35,016,155.14 -1,552,580.61
2. Effect of exchange rate changes -229,065.24 39,449.30
IV. Other changes -24,820,250.85 44,859,709.52
1. Benefits paid -24,820,250.85 -31,910,290.48
2. Changes in the scope of consolidation - 76,770,000.00
V. Closing balance 429,830,989.42 454,383,940.25
The Company's subsidiaries provide the registered retirees and in-service staff with supplementary post-employment
benefit plans.
The Group hired a third-party actuary to estimate the present value of its above-mentioned retirement benefit plan
obligations in an actuarial manner based on the expected cumulative welfare unit method. The Group recognizes the
Group's liabilities based on the actuarial results. The relevant actuarial gains or losses are included in other
comprehensive income and cannot be reclassified into profit or loss in the future. Past service costs are recognized in
profit or loss for the period in which the plan is revised. The net interest is determined by multiplying the defined
benefit plan net debt or net assets by the appropriate discount rate.
- 114 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
41. Provisions
Item Closing balance Opening balance Reason
Estimated expenses on land acquisition and
66,138,336.08 45,897,100.00
reservation for Shangtou Port
Pending litigation (Note) 17,277,583.26 15,079,762.88 Note
Sales discount 16,990,826.32 15,265,697.07
Total 100,406,745.66 76,242,559.95
Note: This represent the estimated compensation amount that the Company's subsidiary TCP may need to pay due
to the pending litigation.
42. Deferred income
Increase in the Decrease in the
Item 1/1/2020 31/12/2020
current year current year
Government grants 1,146,325,779.95 5,015,833.38 39,362,069.29 1,111,979,544.04
Unrealized sale-and-
1,427,077.22 - 518,937.36 908,139.86
leaseback income
Total 1,147,752,857.17 5,015,833.38 39,881,006.65 1,112,887,683.90
Items involving government grants are as follows:
New Recognized in Related to assets
Liabilities 1/1/2020 31/12/2020
subsidies other income /related to income
Refund from marine reclamation land 375,169,820.39 - 19,349,167.92 355,820,652.47 Related to assets
Channel widening project 493,050,681.48 - 9,577,456.38 483,473,225.10 Related to assets
Special subsidies for facilities and equipment 245,274,225.80 1,440,000.00 6,486,652.82 240,227,572.98 Related to assets
Government subsidies for intelligent system 13,171,314.54 3,575,833.38 2,236,545.82 14,510,602.10 Related to assets
Refund of land transfer charges 6,680,000.00 - 111,333.35 6,568,666.65 Related to assets
Green low carbon port project 982,730.02 - 421,170.00 561,560.02 Related to assets
Others 11,997,007.72 - 1,179,743.00 10,817,264.72 Related to assets
Total 1,146,325,779.95 5,015,833.38 39,362,069.29 1,111,979,544.04
43. Other non-current liabilities
Item Closing balance Opening balance
TCP operating rights liability (Note 1) 2,888,395,641.53 3,326,952,857.86
Actuarial cost for the calculation of pension benefits difference for
162,810,000.00 -
the public security bureau staff (Note 2)
Berth priority call right (Note 3) 14,597,949.13 20,664,537.64
Obligation to minority shareholders due to acquisition - 732,733,351.01
Total 3,065,803,590.66 4,080,350,746.51
Less: Other non-current liabilities due within one year 83,582,696.63 825,835,439.66
Including: TCP operating rights liability 67,272,696.63 93,102,088.65
Actuarial cost for the calculation of pension
benefits difference for the public security bureau staff 16,310,000.00 -
(Note 2)
Obligation to minority shareholders due to
- 732,733,351.01
acquisition
Other non-current liabilities due after one year 2,982,220,894.03 3,254,515,306.85
- 115 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
43. Other non-current liabilities - continued
Note 1: As at 23 February 2018, CMPort, a subsidiary of the Company, acquired a 90% stake in TCP
and incorporate it into the consolidated financial statements of the Group. TCP has operation right the port
of Paranagua up to 2048. At 31 December 2020, the payment to acquire the port operation rights is
calculated based on local comprehensive price index.
Note 2: Refer to Note (V) 49 for details.
Note 3: This represents the berth priority call right as agreed in the contract entered into with the clients in 2003,
with total amount of USD 14 million. The Group must give priority to the berthing requirements of the
contracted customers during the contract period. The Group amortized the berth priority right within 20
years using straight-line method. In 2020, the amount included in operating income is RMB 6,066,588.51.
44. Share capital
Changes for the year
Item Opening balance Capitalizatio Closing balance
New issue of Bonus
n of surplus Others Sub-total
share (note) issue
reserve
2020
I. Restricted tradable
shares
1. State-owned shares - - - - - - -
2. State-owned legal -
128,952,746.00 - - - -128,952,746.00 -
person shares 128,952,746.00
3. Other domestic shares 169,602.00 - - - -160,106.00 -160,106.00 9,496.00
4. Foreign shares 1,148,648,648.00 - - - - - 1,148,648,648.00
Total restricted tradable -
1,277,770,996.00 - - - -129,112,852.00 1,148,658,144.00
shares 129,112,852.00
II. Non-restricted tradable
shares
1. Ordinary shares
464,858,324.00 - - - 128,961,746.00 128,961,746.00 593,820,070.00
denominated in RMB
2. Foreign capital shares
179,735,804.00 - - - 151,106.00 151,106.00 179,886,910.00
listed domestically
3. Foreign capital shares
- - - - - - -
listed overseas
4. Others - - - - - - -
Total non-restricted
644,594,128.00 - - - 129,112,852.00 129,112,852.00 773,706,980.00
tradable shares
III. Total shares 1,922,365,124.00 - - - - - 1,922,365,124.00
- 116 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
44. Share capital - continued
Changes for the year
Opening Capitalization
Item New issue of Bonus Closing balance
balance of surplus Others Sub-total
share (note) issue
reserve
2019
I. Restricted tradable
shares
1. State-owned shares - - - - - - -
2. State-owned legal
- 128,952,746.00 - - - 128,952,746.00 128,952,746.00
person shares
3. Other domestic shares 212,156.00 - - - -42,554.00 -42,554.00 169,602.00
4. Foreign shares 1,148,648,648.00 - - - - - 1,148,648,648.00
Total restricted tradable
1,148,860,804.00 128,952,746.00 - - -42,554.00 128,910,192.00 1,277,770,996.00
shares
II. Non-restricted tradable
shares
1. Ordinary shares
464,855,324.00 - - - 3,000.00 3,000.00 464,858,324.00
denominated in RMB
2. Foreign capital shares
179,696,250.00 - - - 39,554.00 39,554.00 179,735,804.00
listed domestically
3. Foreign capital shares
- - - - - - -
listed overseas
4. Others - - - - - - -
Total non-restricted
644,551,574.00 - - - 42,554.00 42,554.00 644,594,128.00
tradable shares
III. Total shares 1,793,412,378.00 128,952,746.00 - - - 128,952,746.00 1,922,365,124.00
45. Capital Reserve
Item Opening balance Increase Decrease Closing balance
2020
Capital premium 22,183,597,895.33 731,489,964.17 218,667,827.13 22,696,420,032.37
Including: Capital contributed by investors 7,012,992,483.94 - - 7,012,992,483.94
Differences arising from business
combination involving enterprises under 13,311,099,845.41 - - 13,311,099,845.41
common control
Differences arising from acquisition of
419,130,116.03 514,196,692.81 218,667,827.13 714,658,981.71
minority interests (Note 1)
Others (Note 2) 1,440,375,449.95 217,293,271.36 - 1,657,668,721.31
Other capital Reserve 112,887,572.02 10,096,607.62 14,334,876.52 108,649,303.12
Including: Transfer from capital reserve under the
-2,781,133.00 - - -2,781,133.00
previous accounting system
Unexercised share-based payment - 10,096,607.62 - 10,096,607.62
Other changes of owners' equity of the
investee under equity method other than
changes in net profit or loss, profit 115,668,705.02 - 14,334,876.52 101,333,828.50
distribution and other comprehensive
income
Total 22,296,485,467.35 741,586,571.79 233,002,703.65 22,805,069,335.49
2019
Capital premium 19,429,694,090.05 2,770,861,727.22 16,957,921.94 22,183,597,895.33
Including: Capital contributed by investors 4,954,397,136.25 2,058,595,347.69 - 7,012,992,483.94
Differences arising from business
combination involving enterprises under 13,311,099,845.41 - - 13,311,099,845.41
common control
Others 1,164,197,108.39 712,266,379.53 16,957,921.94 1,859,505,565.98
Other capital Reserve -2,781,133.00 129,059,971.90 13,391,266.88 112,887,572.02
Including: Transfer from capital reserve under the
-2,781,133.00 - - -2,781,133.00
previous accounting system
Other changes of owners' equity of the
investee under equity method other than
changes in net profit or loss, profit - 129,059,971.90 13,391,266.88 115,668,705.02
distribution and other comprehensive
income
Total 19,426,912,957.05 2,899,921,699.12 30,349,188.82 22,296,485,467.35
- 117 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
45. Capital Reserve - continued
Note 1: Changes for the year include:
(1) The Company chose to acquire the dividends attributable to CMPort in lieu of shares, which increased the
capital reserve by RMB376,103,644.71. Refer to Note (VII) 2 for details.
(2) The Company's subsidiary CMPort acquired 10% of the equity of TCP through its controlling subsidiary
Kong Rise Development Limited. The difference of the payment made for the equity acquisition after
deducting the share of the subsidiary's net assets calculated by the acquired proportion of equity and the fair
value of the relevant put options and their changes was RMB534,509,477.23. The Company reduced its
capital reserve according to its shareholding in CMPort by RMB218,667,827.13. Refer to Note (VII) 2
for details.
(3) The Company's subsidiary CMPort transferred 23.5294% of the equity of its subsidiary Gainpro Resources
Limited (hereinafter referred to as "Gainpro") to Fujian Transportation Maritime Silk Road Investment and
Management Co. Limited (hereinafter referred to as "Fujian Transportation Maritime Silk Road"). The
difference of the received cash consideration after deducting the share of the subsidiary's net assets
calculated by the proportion of transferred equity was RMB 332,114,112.80. The Company increased its
capital reserve according to its shareholding in CMPort by RMB138,093,048.10. Refer to Note (VII) 2 for
details.
Note 2: The increase for the year is mainly the transfer of the refunded port construction fund of the Company's
subsidiary Zhanjiang Port from the special payables to the capital reserve. The Company increased its
capital reserve according to its shareholding in the subsidiary by RMB216,138,382.34.
- 118 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
46. Other comprehensive income
2020
Less: Amount
included in Less: Other
other comprehensive
Post-tax income Post-tax income income carried
Item Opening balance comprehensive Closing balance
Pre-tax amount Less: Income attributable to attributable to forward to
income in the
for the year tax expense the parent minority retained
prior periods
company owner shareholders earnings
transferred to
profit or loss in
this period
2020
I. Other comprehensive income that will not be reclassified subsequently
82,969,758.27 6,911,190.88 - -33,528.75 -1,552,867.01 8,497,586.64 - 81,416,891.26
to profit or loss
Including: Changes arising from remeasurement of defined benefits plan 1,069,722.83 35,016,155.14 - - 10,248,546.35 24,767,608.79 - 11,318,269.18
Other comprehensive income that can't be transferred to profit
4,830,921.62 -28,307,578.26 - - -11,817,008.06 -16,490,570.20 - -6,986,086.44
or loss under equity method
Changes in fair value of other equity instruments 77,069,113.82 202,614.00 - -33,528.75 15,594.70 220,548.05 - 77,084,708.52
II. Other comprehensive income that will be reclassified subsequently to
-438,914,324.18 -1,856,601,660.49 - - -469,199,870.14 -1,387,401,790.35 - -908,114,194.32
profit or loss
Including: Other comprehensive income that may be transferred to profit
-58,950,164.54 217,642,457.56 - - 90,675,445.06 126,967,012.50 - 31,725,280.52
or loss under equity method
Translation differences of financial statements denominated in
-379,964,159.64 -2,074,244,118.05 - - -559,875,315.20 -1,514,368,802.85 - -939,839,474.84
foreign currencies
Total other comprehensive income -355,944,565.91 -1,849,690,469.61 - -33,528.75 -470,752,737.15 -1,378,904,203.71 - -826,697,303.06
- 119 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
46. Other comprehensive income - continued
2019
Less: Amount
included in Less: Other
other comprehensive
Post-tax income Post-tax income income carried
Item Opening balance comprehensive Closing balance
Pre-tax amount Less: Income attributable to attributable to forward to
income in the
for the year tax expense the parent minority retained
prior periods
company owner shareholders earnings
transferred to
profit or loss in
this period
2019
I. Other comprehensive income that will not be reclassified subsequently
75,673,134.08 19,605,662.56 - 985,483.75 9,090,184.52 9,529,994.29 1,793,560.33 82,969,758.27
to profit or loss
Including: Changes arising from remeasurement of defined benefits plan - 1,552,580.61 - - 1,069,722.83 482,857.78 - 1,069,722.83
Other comprehensive income that can't be transferred to profit
- 13,161,546.95 - - 4,830,921.62 8,330,625.33 - 4,830,921.62
or loss under equity method
Changes in fair value of other equity instruments 75,673,134.08 4,891,535.00 - 985,483.75 3,189,540.07 716,511.18 1,793,560.33 77,069,113.82
II. Other comprehensive income that will be reclassified subsequently to
13,252,844.49 -1,114,906,073.32 - - -452,167,168.67 -662,738,904.65 - -438,914,324.18
profit or loss
Including: Other comprehensive income that may be transferred to profit
100,000.00 -146,982,017.86 - - -59,050,164.54 -87,931,853.32 - -58,950,164.54
or loss under equity method
Translation differences of financial statements denominated in
13,152,844.49 -967,924,055.46 - - -393,117,004.13 -574,807,051.33 - -379,964,159.64
foreign currencies
Total other comprehensive income 88,925,978.57 -1,095,300,410.76 - 985,483.75 -443,076,984.15 -653,208,910.36 1,793,560.33 -355,944,565.91
- 120 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
47. Special reserve
Opening
Item Increase Decrease Closing balance
balance
2020
Production safety reserve 12,386,734.70 57,538,524.86 59,724,081.26 10,201,178.30
2019
Production safety reserve 8,231,080.43 108,062,435.41 103,906,781.14 12,386,734.70
48. Surplus reserve
Item Opening balance Increase Decrease Closing balance
2020
Statutory surplus reserve 630,345,307.43 260,345,014.85 - 890,690,322.28
2019
Statutory surplus reserve 527,175,908.67 103,169,398.76 - 630,345,307.43
49. Unappropriated profit
Proportion of
Item Amount appropriation or
allocation
2020
Unappropriated profit at the end of last year 11,467,166,351.85
Add: Net profit of the year attributable to shareholders
2,065,322,969.66
of the parent
Pension Benefits -73,228,871.09 Note 1
Others 1,549,916.64
Less: Appropriation to statutory surplus reserve 260,345,014.85
Appropriation to discretionary surplus reserve -
Appropriation to general risk reserve -
Ordinary shares' dividends payable 884,287,957.04 Note 2
Ordinary shares' dividends converted into share
-
capital
Unappropriated profit at the end of the year 12,316,177,395.17
- 121 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
49. Unappropriated profit - continued
Proportion of
Item Amount appropriation or
allocation
2019
Unappropriated profit at the end of prior year before
8,915,817,110.21
adjustment
Adjustment of total unappropriated profit at the
-41,018,077.68
beginning of year
Unappropriated profit at the beginning of year after
8,874,799,032.53
adjustment
Add: Net profit attributable to shareholders of the
2,898,192,168.84
Company for the year
Others 1,793,560.33
Less: Appropriation to statutory surplus reserve 103,169,398.76
Appropriation to discretionary surplus reserve -
Appropriation to general risk reserve -
Ordinary shares' dividends payable 204,449,011.09
Ordinary shares' dividends converted into share
-
capital
Unappropriated profit at the end of the year 11,467,166,351.85
Note 1: In accordance with the Notice on Issuing the Plan for Deeping Administration System Reform of Port &
Channel Public Security Authorities (No.327 [2017], State Commission Office of Public Sectors Reform)
and the Notice on Issuing the Implementation Plan for Deeping Administration System Reform of Port &
Channel Public Security Authorities (No.221 [2018], Guangdong Commission Office of Public Sectors
Reform), in 2020, Zhanjiang Port, a subsidiary of the Company, transferred the Zhanjiang Port Public
Security Bureau to Zhanjiang Municipal Government, which are fully taken over by the Zhanjiang
Municipal Public Security Bureau. The relevant assets of the former Zhanjiang Port Public Security
Bureau, totalling RMB11,372,339.22, were transferred to Zhanjiang Municipal Government, the police in-
service were transitioned to civil servants in accordance with national regulations, the retired police were
included in the jurisdiction of the pension insurance of state organs and public institutions, and the
difference between the original standard of pension benefits and the retirement benefits of the Zhanjiang
municipal police (hereinafter referred to as the "pension benefits difference") shall be borne by Zhanjiang
Port. Zhanjiang Port engaged Towers Watson Consulting (Shenzhen) Co., Ltd. to perform actuarial
calculations on the difference in pension benefits of retired police, and accrued relevant liabilities of
RMB162,810,000.00 on the actuarial results. In accordance with Notice by the Ministry of Finance on
Financial Management Issues Relating to the Separation of Social Functions of Enterprises (No. 62 [2005],
Cai Qi), the above-mentioned matters resulted in a total elimination of RMB174,110,113.73 from the
unappropriated profit of Zhanjiang Port for the year, and a corresponding elimination of
RMB73,228,871.09 from the unappropriated profit of the Company in proportion to the Company's equity
interest in Zhanjiang Port.
- 122 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
49. Unappropriated profit - continued
Note 2: According to the resolution of shareholders meeting on 22 May 2020, the Company distributes cash
dividends of RMB 4.60 (inclusive of tax) for every 10 shares, totalling to RMB884,287,957.04 on the
basis of the total shares of 1,922,365,124 shares at the end of 2019.
Note 3: Profit distribution after the balance sheet date
According to the profit distribution plan for 2020, approved by the [10th] board of directors at the [3th]
meeting on 29/03/2021, the Company, based on the total shares of 1,922,365,124 on the 31 December
2020, would distribute cash dividends at an amount of RMB730,498,747.12. The above profit distribution
plan has yet been approved by shareholders meeting.
50. Operating income and operating costs
(1) Operating income and operating costs
Amount incurred in the current period Amount incurred in the prior period
Item
Income Cost Income Cost
Principal operation 12,465,115,944.45 7,652,480,534.91 11,958,482,255.05 7,425,898,430.33
Other operations 153,414,051.57 221,269,319.94 165,347,168.69 223,022,489.38
Total 12,618,529,996.02 7,873,749,854.85 12,123,829,423.74 7,648,920,919.71
(2) Revenue from contracts
Bonded logistics
Categories of contracts Ports operation Other operations Total
operation
Mainland China, Hong Kong
8,572,810,408.71 391,346,440.50 153,414,051.57 9,117,570,900.78
and Taiwan area
- Pearl River Delta 5,103,018,820.66 266,096,953.36 153,414,051.57 5,522,529,825.59
- Yangtze River Delta 73,413,401.10 - - 73,413,401.10
- Bohai Rim 62,661,236.23 125,249,487.14 - 187,910,723.37
- Other areas 3,333,716,950.72 - - 3,333,716,950.72
Other countries 3,474,914,093.88 26,045,001.36 - 3,500,959,095.24
Total 12,047,724,502.59 417,391,441.86 153,414,051.57 12,618,529,996.02
- 123 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
50. Operating income and operating costs - continued
(3) Description of performance obligations
The Group provides wharf service, bonded logistics service and other services. These services are obligations
performed over a period of time. For wharf services, as the handling time for containers and bulk cargos is short, the
management believes that it is not necessary to recognize revenue according to the progress towards the completion
of contract and it is an appropriate method to recognize the fulfilment of performance obligation and revenue upon
the completion of the service. For bonded logistics service and other services, the customers evenly obtains and
consumes the economic benefits from the Group's performance of contract, meanwhile the charging rules as agreed in
the contract terms usually adopt daily/month/yearly basis. During the process of rendering services, the Group
recognizes revenue using straight-line method. Part of the Group's handling contracts are established with discount
terms, i.e. the customers whose business volume reaches agreed level, are granted with preferential charge rate or
discount. At the end of the year, as the business quantity finally realized within the contract period is uncertain, the
contract consideration is subject to variable factors. The management included this part of discount in provisions.
Details are set out in Note (V) 41. The Group's revenue contract does not have significant financing components.
(4) At the end of the year, the variable consideration of RMB16,990,826.32
(31 December 2019: RMB15,265,697.07) arising from sales discount is not
included in the transaction price due to the restriction requirements
relating to variable considerations.
51. Taxes and surcharges
Amount incurred in the Amount incurred in the
Item
current period prior period
Property tax 57,039,293.40 45,998,786.01
Land use tax 33,997,061.02 32,116,936.18
Stamp duty 7,540,714.68 4,948,743.36
City construction and maintenance tax 6,960,172.96 6,188,074.98
Education surcharges and local education surcharges 5,198,771.63 4,866,915.60
Others (Note) 40,460,929.88 78,437,123.79
Total 151,196,943.57 172,556,579.92
Note: Others mainly represent (1) Program of Social Integration and Contribution for the Financing of Social
Security (tax on enterprise income) and Tax on Services (tax based on services rendered) borne by TCP, a
subsidiary of the Company, totalled BRL23,076,661.64 (equivalent to RMB34,531,567.04) for the year. (2)
The environmental protection tax borne by Zhanjiang Port, a subsidiary of the Company, amounted to
RMB5,357,096.48 for the year.
- 124 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
52. Administrative expenses
Amount incurred in Amount incurred in
Item
the current period the prior period
Employee's salary 1,089,142,762.24 980,074,507.53
Depreciation expenses 83,029,752.43 74,954,306.82
Fees paid to agencies 72,867,327.15 55,258,915.07
Amortization of intangible assets 63,903,389.47 58,414,351.33
Others 275,939,703.73 340,818,500.91
Total 1,584,882,935.02 1,509,520,581.66
53. Financial expenses
Amount incurred in Amount incurred in
Item
the current period the prior period
Interest expense 1,915,963,616.06 2,018,175,947.65
Less: Capitalized interest expenses 65,255,075.44 35,175,196.89
Less: Interest income 325,387,744.56 252,060,018.58
Exchange differences 99,173,836.07 106,836,843.78
Handling fee 19,293,388.81 56,876,221.78
Others -415,864,228.16 37,236,030.34
Interest expenses of lease liabilities 4,805,832.04 4,379,909.45
Total 1,232,729,624.82 1,936,269,737.53
54. Other income
Amount incurred in Amount incurred in
Item
the current period the prior period
Central special financial fund for the development of the rental
73,356,900.00 -
housing market
Transferred from allocation of deferred income 39,362,069.29 37,903,296.88
Additional deduction of VAT 17,977,697.02 13,268,318.27
Government subsidies for business development 16,666,657.00 71,492,270.22
Refund of unemployment insurance premium 13,701,836.63 -
Special fund for innovation 11,662,568.44 9,802,600.00
Subsidies for preventing epidemics 6,670,018.69 -
Facility construction fund 5,799,000.00 5,448,613.20
Special fund for operation 4,530,545.00 8,402,815.28
Steady post subsidies 4,286,036.86 1,985,363.23
Refund of withholding taxes 2,655,040.88 6,903,526.71
Air environment quality improvement subsidy 1,544,768.00 -
Value-added tax levied and immediately returned for software
1,438,961.78 -
products
Special fund for promoting high-quality development of
- 1,000,000.00
economy
Others 5,313,013.69 5,894,309.31
Total 204,965,113.28 162,101,113.10
- 125 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
55. Investment income (loss is marked with "-")
(1) Details of investment income:
Amount incurred Amount incurred
Item in the current in the prior
period period
Long-term equity investments income under equity method 3,988,916,963.08 3,727,850,763.22
Including: Long-term equity investments income of associates under
3,630,921,407.38 3,259,151,741.65
equity model
Including: Long-term equity investments income of joint venture under
357,995,555.70 468,699,021.57
equity model
Gains from remeasurement of previously held equity at fair value upon
753,988,749.80 845,432,476.22
obtaining the control(Note)
Investment income on held-for-trading financial assets 10,181,238.09 -
Investment income on other non-current financial assets 83,138,043.43 127,790,790.54
Investment income on disposal of other non-current financial assets
1,850,600.00 -407,903.18
(loss is marked with "-")
Dividend income on other equity instruments 8,568,250.21 10,942,760.11
Interest income on debt investments 59,331,593.61 20,352,987.67
Others - -112,788,119.16
Total 4,905,975,438.22 4,619,173,755.42
Note: Refer to Note (VI) 1 for details.
(2) Details of long-term equity investments income under equity method
Amount incurred Amount incurred
Investee in the current in the prior Reason for changes
period period
Shanghai International Port (Group) Co.,
2,234,593,249.98 2,425,921,985.71 Changes in net profit of investee
Ltd.
Nanshan Group 424,745,838.41 242,285,185.34 Changes in net profit of investee
Shenzhen China Merchants Qianhai
335,639,784.43 -5,514,066.49 Changes in net profit of investee
Industrial Development Co., Ltd.
Terminal Link SAS 312,427,210.29 280,560,341.83 Changes in net profit of investee
Liaoning Port Co., Ltd. 169,692,898.03 148,347,321.32 Changes in net profit of investee
Ningbo Daxie 112,101,331.18 120,498,548.83 Changes in net profit of investee
Qingdao Qianwan United Container
102,594,175.95 142,602,575.17 Changes in net profit of investee
Terminal Co., Ltd.
Modern Terminals Limited 79,503,339.53 65,866,911.57 Changes in net profit of investee
Euro-Asia Oceangate, S.a` r.l. 71,938,690.26 71,820,758.28 Changes in net profit of investee
Zhanjiang Merchants Port City Investment
47,450,708.28 -8,749,223.97 Changes in net profit of investee
Co., Ltd.
Others 98,229,736.74 244,210,425.63 Changes in net profit of investee
Total 3,988,916,963.08 3,727,850,763.22
- 126 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
56. Gains on changes in fair value (loss is marked with "-")
Amount incurred Amount incurred
Item in the current in the prior
period period
Held-for-trading financial assets -226,508.15 -
Other non-current financial assets 269,099,721.85 431,344,898.81
Including: Financial assets at fair value through profit or loss 269,099,721.85 431,344,898.81
Other non-current liabilities -680,381,987.28 -364,861,632.33
Including: Financial liabilities at fair value through profit or loss -680,381,987.28 -364,861,632.33
Total -411,508,773.58 66,483,266.48
57. Gains on impairment of credit (loss is marked with "-")
Amount incurred Amount incurred
Item in the current in the prior
period period
I. Gains on impairment of credit of accounts receivable (loss is marked
19,219,046.93 -51,878,244.38
with "-")
II. Gains on impairment of credit of other receivables (loss is marked
-475,764,740.63 1,682,076.71
with "-")
III. Gains on impairment of credit of long-term receivables (loss is
-2,049,967.61 -1,082,720.15
marked with "-")
IV. Others - 1,029,478.05
Total -458,595,661.31 -50,249,409.77
58. Gains from impairment of assets (loss is marked with "-")
Amount incurred Amount incurred
Item in the current in the prior
period period
Gains from decline in value of inventories 947,694.12 25,051.16
Losses on goodwill impairments -552,317,736.65 -
Total -551,370,042.53 25,051.16
59. Gains on disposal of assets (loss is marked with "-")
Amount included in
Amount incurred Amount incurred
non-recurring profit
Item in the current in the prior
or loss for the
period period
current year
Gains on disposal of non-current assets (Note) 1,489,206,502.32 4,794,562,782.79 1,489,206,502.32
Including: Gains on disposal of fixed assets (loss
-50,184,379.22 6,759,787.47 -50,184,379.22
is marked with "-")
Gains on disposal of intangible assets 1,480,715,445.14 1,108,671,001.98 1,480,715,445.14
Gains on disposal of construction in progress 59,164,336.00 47,902,373.19 59,164,336.00
Others -488,899.60 3,631,229,620.15 -488,899.60
Note: It mainly represents the compensation gains of RMB1,531,862,344.99 from land acquisition and reservation
of Shantou Port, a subsidiary of the Company. Please refer to Note (V) 7 for details.
- 127 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
60. Non-operating income
Amount included in
Amount incurred Amount incurred
non-recurring profit
Item in the current in the prior
or loss for the
period period
current year
Government subsidy 53,884,602.38 485,929.28 53,884,602.38
Insurance compensation received 3,548,709.63 - 3,548,709.63
Gains from the retirement of damaged non-
3,272,216.69 3,431,545.27 3,272,216.69
current assets
Compensation received for contracts violation 3,074,739.23 14,444,165.81 3,074,739.23
Exempted account currents 2,603,213.36 2,026,044.81 2,603,213.36
Operation compensation - 488,492,798.26 -
Others 15,255,579.25 44,222,876.98 15,255,579.25
Total 81,639,060.54 553,103,360.41 81,639,060.54
61. Non-operating expenses
Amount included in
Amount incurred Amount incurred
non-recurring profit
Item in the current in the prior
or loss for the
period period
current period
Donations 29,768,154.87 31,344,046.81 29,768,154.87
Stability maintenance housing subsidy 13,500,000.00 - 13,500,000.00
Losses on retirement of non-current assets 11,905,789.11 24,459,845.75 11,905,789.11
Compensation, liquidated damages and penalties 9,131,029.28 5,574,036.67 9,131,029.28
Litigation loss 7,992,269.39 438,712.24 7,992,269.39
Others 6,706,498.12 8,635,370.93 6,706,498.12
Total 79,003,740.77 70,452,012.40 79,003,740.77
62. Income tax expenses
Amount incurred Amount incurred
Item in the current in the prior
period period
Current income tax expenses 1,303,748,401.73 2,308,373,316.21
Deferred income tax expenses -28,062,031.90 332,165,578.41
Total 1,275,686,369.83 2,640,538,894.62
- 128 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
62. Income tax expenses - continued
Reconciliation of income tax expenses to the accounting profit is as follows:
Amount incurred
Item in the current
period
Gross profit 6,801,254,420.39
Income tax expenses calculated at 25% 1,700,313,605.10
Effect of non-deductible cost, expenses and losses 452,645,594.53
Accrued income tax expenses 757,856,918.42
Effect of deductible temporary differences and deductible losses for which the deferred tax
79,218,381.58
assets are not recognized in current period
Effect of tax-free income (Note) -1,048,022,499.09
Effect of tax incentives and changes of tax rate -309,332,989.66
Effect of different tax rates of subsidiaries operating in other jurisdictions -262,775,668.86
Effect of utilizing deductible losses for which the deferred tax assets were not recognized
-33,602,540.09
in prior period
Effect of adjustments to prior-year income tax -22,647,137.52
Changes in the opening balance of deferred tax assets/ liabilities due to tax adjustments -12,996,277.16
Others -24,971,017.42
Income tax expenses 1,275,686,369.83
Note: This mainly represents the tax effect on investment income from joint venture and associates.
63. Assets with restricted ownership or use right
Item Closing balance Opening balance
Cash and bank balances (Note 1) 11,528,570.90 15,648,978.15
Equity investment in Colombo International Container Terminals
1,626,554,439.58 1,591,452,920.23
Limited (Note 2)
Equity investment in Thesar Maritime Limited (Note 2) 859,148,327.98 799,684,707.77
Fixed assets (Note 3) 341,931,071.09 349,612,960.23
Intangible assets (Note 3) 218,825,477.36 345,131,760.52
Construction in progress (Note 3) 43,751,101.60 23,840,920.42
Total 3,101,738,988.51 3,125,372,247.32
Note 1: Details of restricted cash and bank balances are set out in Note (V) 1.
Note 2: Details of mortgaged equity and interests are set out in Note (V) 36.
Note 3: Yide Port mortgaged its land use rights, fixed assets and construction in progress to obtain bank
borrowings; Shenzhen Haixing Harbor Development Co., Ltd. mortgaged its land use rights to
obtain bank borrowings; Dongguan Chiwan Warf Co., Ltd. mortgaged its sea area use right to
obtain bank borrowings. Details of mortgage borrowings are set out in Note (V) 36.
- 129 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
64. Other comprehensive income
Details are set out in Note (V) 46.
65. Items in cash flow statement
(1) Other cash receipts relating to operating activities:
Amount incurred Amount incurred
Item in the current in the prior
period period
Government grants 203,870,741.85 614,567,707.23
Interest income 196,435,428.56 212,679,224.25
Guarantees and deposits 64,688,970.41 30,791,091.36
Insurance indemnities 11,043,593.46 4,565,218.67
Rentals 10,735,793.35 16,310,934.86
Refund of port construction fee and service charges 1,660,916.38 2,803,216.00
Compensation from contracts - 13,860,280.30
Others 327,481,343.25 270,133,172.51
Total 815,916,787.26 1,165,710,845.18
(2) Other cash payments relating to operating activities
Amount incurred Amount incurred
Item in the current in the prior
period period
Operating expenses such as operating costs and
183,167,316.54 201,645,233.00
administration expense etc.
Advance payment 139,587,590.26 177,076,380.78
Guarantees and deposits 34,084,841.10 20,638,334.19
Rentals 23,217,510.11 31,228,253.07
Port construction fee 11,661,727.63 26,478,534.06
Port charges 7,481,400.21 8,187,025.59
Harbor dues on cargo - 3,138,152.55
Others 352,769,397.12 341,307,637.90
Total 751,969,782.97 809,699,551.14
- 130 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
65. Items in cash flow statement - continued
(3) Other cash receipts relating to investing activities
Amount incurred Amount incurred
Item in the current in the prior
period period
Recovered principal for the advances of the project 825,670,000.00 -
Net cash receipts by acquiring subsidiaries and other
317,470,188.12 845,457,228.45
business entities (Note)
Received compensation for the transition period of
87,104,514.28 -
Zhanjiang Port
Recovered lendings 33,282,119.52 1,018,695,828.48
Zhanjiang Port Transition Compensation 3,803,477.07 -
Recovered restricted deposits in the acquisition of the
- 1,001,472,400.00
Hambantota Port
Recovered principal of structural deposits that cannot
- 314,000,000.00
be withdrawn at any time
Receipt from credit assignment - 356,137,574.00
Others 186,182,916.72 204,000.00
Total 1,453,513,215.71 3,535,967,030.93
Note: Refer to Note (V) 65(4) for details.
(4) Net cash receipts for acquiring subsidiaries and other operating units
Amount incurred
Item in the current
period
Cash and cash equivalents paid for business combination in the current year -
Including: Ningbo Daxie -
Less: Cash and cash equivalents held by subsidiaries at the acquisition date 317,470,188.12
Including: Ningbo Daxie 317,470,188.12
Net cash payments for acquisition of subsidiaries -317,470,188.12
Including: Ningbo Daxie -317,470,188.12
(5) Other cash payments relating to investing activities
Amount incurred Amount incurred
Item in the current in the prior
period period
Structured deposit that is not readily for withdrawal - 1,610,000,000.00
Debt transfer payment - 356,137,574.00
Related party borrowings 3,009,744,121.38 104,390,000.00
Supplementary payment of tax on significant assets
- 68,423,555.78
restructuring
Others 26,229.24 -
Total 3,009,770,350.62 2,138,951,129.78
- 131 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
65. Items in cash flow statement - continued
(6) Other cash receipts relating to financing activities
Amount incurred Amount incurred
Item in the current in the prior
period period
Proceeds of CMPort from disposal of part of equity of
1,851,325,647.36 1,713,327,483.01
subsidiaries
Equity capital recovered from minority shareholders for
82,129,289.00 -
Shantou Port
Recovered financing lease deposits 4,500,000.00 -
Total 1,937,954,936.36 1,713,327,483.01
(7) Other cash payments relating to financing activities
Amount incurred Amount incurred
Item in the current in the prior
period period
Amount paid by CMPort for the acquisition of minority
755,398,999.97 -
shareholders' equities
Payments for the liquidation of Shantou Port's
82,129,289.00 -
subsidiaries
Bonds issuance cost - 6,600,000.00
Repayment of advances of shareholders - 1,592,783.29
Others 5,033,180.99 34,391,014.26
Total 842,561,469.96 42,583,797.55
- 132 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
66. Supplementary information to the cash flow statement
(1) Supplementary information to the cash flow statement
Amount incurred Amount incurred
Supplementary information in the current in the prior
period period
1. Reconciliation of net profit to cash flows from operating
activities:
Net profit 5,525,568,050.56 8,166,917,273.20
Add: Provision for impairment losses of assets 551,370,042.53 -25,051.16
Provision for impairment losses of credit 458,595,661.31 50,249,409.77
Depreciation of fixed assets 1,811,160,796.05 1,681,007,226.50
Depreciation of investment property 189,954,310.24 190,418,170.86
Depreciation of right-of-use assets 355,744,855.65 328,886,210.72
Amortization of intangible assets 609,540,465.06 632,626,770.16
Amortization of long-term prepaid expenses 45,482,342.76 31,586,968.21
Losses on disposal of fixed assets, intangible assets and other
long-term assets (gain is marked with "-")
-1,489,206,502.32 -4,794,562,782.79
Losses on retirement of fixed assets, intangible assets and other
long-term assets
8,633,572.42 24,459,845.75
Losses on changes in fair value (gain is marked with "-") 411,508,773.58 -66,483,266.48
Financial expenses 1,305,513,925.66 2,127,073,624.88
Investment loss (gain is marked with "-") -4,905,975,438.22 -4,619,173,755.42
Decrease in deferred tax assets (increase is marked with "-") -120,295,556.03 -191,905,933.39
Increase in deferred tax liabilities 92,233,524.13 524,071,511.80
Decrease in inventories (increase is marked with "-") -38,670,837.40 -11,704,381.63
Decrease in operating receivables (increase is marked with "-") -449,965,094.91 -2,391,266,937.99
Increase in operating payables 1,134,608,025.94 3,819,698,512.95
Net cash flows from operating activities 5,495,800,917.01 5,501,873,415.94
2. Significant investing and financing activities that do not involve
cash receipts and payments:
Conversion of debt into capital - -
Convertible bonds due within one year - -
Fixed assets acquired under finance leases - -
3. Net changes in cash and cash equivalents:
Closing balance of cash 11,771,619,303.21 7,714,157,995.87
Less: Opening balance of cash 7,714,157,995.87 5,373,281,504.75
Add: Closing balance of cash equivalents - -
Less: Opening balance of cash equivalents - -
Net increase in cash and cash equivalents 4,057,461,307.34 2,340,876,491.12
(2) Cash and cash equivalents
Item Closing balance Opening balance
I. Cash 11,771,619,303.21 7,714,157,995.87
Including: Cash on hand 570,307.93 331,305.65
Bank deposits available for payment at any time 11,418,758,567.44 7,422,490,058.00
Other monetary funds available for payment at any
352,290,427.84 291,336,632.22
time
II. Cash equivalents - -
III. Balance of cash and cash equivalents at the end of the year 11,771,619,303.21 7,714,157,995.87
- 133 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
67. Foreign currency monetary items
Closing balance of
Item Exchange rate Closing amount in RMB
foreign currency
Cash and bank balances 1,905,475,474.78
Including: HKD 56,199,956.09 0.8416 47,297,883.05
USD 56,276,436.51 6.5249 367,198,120.58
EUR 45,659,283.84 8.0250 366,415,752.82
RMB 1,124,563,718.33 1.0000 1,124,563,718.33
Accounts receivable 203,448,369.46
Including: HKD 3,821,664.96 0.8416 3,216,313.23
USD 4,757,977.91 6.5249 31,045,330.06
EUR 21,082,458.09 8.0250 169,186,726.17
Other receivables 1,065,027,108.18
Including: HKD 30,806,619.51 0.8416 25,926,850.98
USD 9,905,236.96 6.5249 64,630,680.64
EUR 94,429,498.59 8.0250 757,796,726.18
RMB 216,672,850.38 1.0000 216,672,850.38
Non-current assets due within one year 51,286,674.10
Including: USD 7,860,147.14 6.5249 51,286,674.10
Long-term receivables 2,746,067,386.31
Including: USD 420,859,689.24 6.5249 2,746,067,386.31
Short-term borrowings 1,320,810,000.00
Including: HKD 200,000,000.00 0.8416 168,320,000.00
USD 100,000,000.00 6.5249 652,490,000.00
RMB 500,000,000.00 1.0000 500,000,000.00
Accounts payable 30,525,030.58
Including: HKD 4,562,063.34 0.8416 3,839,432.51
USD 31,136.44 6.5249 203,162.16
EUR 3,299,260.30 8.0250 26,476,563.91
RMB 5,872.00 1.0000 5,872.00
Other payables 766,503,180.60
Including: HKD 40,249,878.84 0.8416 33,874,298.03
USD 78,182,967.43 6.5249 510,136,044.18
EUR 16,901,281.16 8.0250 135,632,781.31
RMB 86,860,057.08 1.0000 86,860,057.08
Non-current liabilities due within one
426,641,874.26
year
Including: USD 6,821,555.12 6.5249 44,509,965.01
EUR 36,975,000.00 8.0250 296,724,375.00
RMB 85,407,534.25 1.0000 85,407,534.25
Long-term borrowings 3,170,840,790.00
Including: USD 229,600,000.00 6.5249 1,498,117,040.00
EUR 124,950,000.00 8.0250 1,002,723,750.00
RMB 670,000,000.00 1.0000 670,000,000.00
Bonds payable 18,720,930,378.52
Including: USD 2,486,004,441.22 6.5249 16,220,930,378.52
RMB 2,500,000,000.00 1.0000 2,500,000,000.00
Long-term payables 1,188,465,420.57
Including: EUR 54,484,576.49 8.0250 437,238,325.33
USD 115,132,353.79 6.5249 751,227,095.24
- 134 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(V) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
68. Government grants
Amount included in
Presentation
Type Amount Item profit or loss for the
account
period
Special central budget for the development of the rental housing
Related to income 73,356,900.00 Other income 73,356,900.00
market
Related to income Non-operating
52,970,000.00 Subsidiaries of introducing investment 52,970,000.00
income
Related to income 16,666,657.00 Government subsidies for business development Other income 16,666,657.00
Related to income 13,701,836.63 Refund of unemployment insurance premium Other income 13,701,836.63
Related to income 11,662,568.44 Special fund for innovation Other income 11,662,568.44
Related to income 6,670,018.69 Subsidies for preventing epidemics Other income 6,670,018.69
Related to income 5,799,000.00 Subsidies for the construction of shore-to-ship power supply system Other income 5,799,000.00
Deferred
Related to income 5,015,833.38 Subsidies of intelligent system and facilities and equipment -
income
Related to income 4,530,545.00 Special fund for operation Other income 4,530,545.00
Related to income 4,286,036.86 Steady post subsidies Other income 4,286,036.86
Related to income 1,544,768.00 Air environment quality improvement subsidy Other income 1,544,768.00
value-added tax levied and immediately returned for software
Related to income 1,438,961.78 Other income 1,438,961.78
products
Related to income 5,313,013.69 Others Other income 5,313,013.69
Non-operating
Related to income 914,602.38 Others 914,602.38
income
Total 203,870,741.85 198,854,908.47
69. Lease
Undiscounted lease receipts subsequent to the balance sheet date are as follows:
Maturity analysis of undiscounted lease receipts 31/12/2020
1st year subsequent to the balance sheet date 286,233,247.28
2nd year subsequent to the balance sheet date 136,732,886.83
3rd year subsequent to the balance sheet date 95,628,740.71
4th year subsequent to the balance sheet date 79,209,529.00
5th year subsequent to the balance sheet date 72,940,772.30
Subsequent years 317,212,150.30
Total 987,957,326.42
Note 1: The operating leases where the Group as the lessor are related to port and terminal facilities, machinery
equipment, vehicles, land and buildings, with lease terms ranging from 1 month to 50 years and option to
renew the lease of port and terminal facilities, machinery equipment, land and buildings. The Group
considers that as the leased assets are properly used, the unguaranteed balance of such assets does not
constitutes material risk of the Group.
Note 2: For 2020, the revenue relating to operating lease amounts to RMB 366,100,557.24; there is no revenue
relating to variable lease payment that is not included in lease receipts.
- 135 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(VI) CHANGES IN SCOPE OF CONSOLIDATION
1. Business combination not involving enterprises under common control for
the year
Basis for Acquiree's Acquiree's net
Date on which
Proportion of determining income from profit from
the Acquisition
Name of acquiree Acquisition cost equity Acquisition date the acquisition date acquisition date
investment is method to the end of the to the end of the
acquired (%) acquisition
acquired year year
date
19 November Concerted action Transfer of de
Ningbo Daxie 1,723,788,876.57 45.00 19 November 2020 73,403,212.42 27,286,541.83
2020 agreement facto control
Note: On 19 November 2020, Cyber Chic Company Limited, the subsidiary of the Company and the other
shareholders of Ningbo Daxie China Merchants International Terminals Co. Ltd. ( Ningbo Zhoushan and
CITIC Port Investmetn Co.,Ltd) establish the Budget Committee through resolutions of shareholder
meeting, and entered into a Cooperation Agreement with Ningbo Zhoushan Port Company Limited
("Ningbo Port"),
The Budget Committee consists of three directors, one nominated by each shareholder to be a member of
the Budget Committee and the director nominated by Cyber Chic Company Limited to be the
Chairman.The Budget Committee is mainly responsible for the examination and approval of Ningbo
Daxie's annual business plan, annual financial budget and final accounts, and after-tax profit distribution
plan.Any matter considered by the Budget Committee shall be approved by a two-thirds majority.
Pursuant to the cooperation agreement, Cyber Chic Company Limited and Ningbo Zhoushan will consult
and communicate to reach a common action prior to the exercise of shareholder rights.If both parties fail
to reach a consensus on the operation and management of Ningbo Daxie, it will be decided according to
the opinion of Cyber Chic Company Limited.No consideration will be paid by either party under the
Cooperation Agreement.
After the signing of the cooperation agreement, Cyber Chic Company Limited and Ningbo Zhoushan
jointly own more than 50% of the shares of Ningbo Daxie.Therefore, as of November 19, 2020, the Group
will include Ningbo Daxie into the consolidated scope of consolidated financial statements, Ningbo Daxie
will also be transformed from a joint venture company of the Group into a subsidiary of the Group, with
the same shareholding ratio.
2. Combination cost and goodwill
Combination cost Ningbo Daxie
Cash -
Fair value of previously held equity at acquisition date 1,723,788,876.57
Others -
Total combination cost 1,723,788,876.57
Less: Share of fair value of net identifiable assets 1,535,291,682.16
Goodwill 188,497,194.41
- 136 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(VI) CHANGES IN SCOPE OF CONSOLIDATION - continued
3. Business combination not involving enterprises under common control
(1) Identifiable assets, liabilities of the acquiree at acquisition date
Ningbo Daxie
Fair value at acquisition Carrying amount at
date acquisition date
Assets:
Current assets 452,190,770.34 452,190,770.34
Investments in other equity instruments 17,689,094.74 17,744,912.00
Fixed assets 2,367,025,860.63 1,762,938,008.76
Construction in progress 22,262,821.75 22,262,821.75
Intangible assets 1,246,136,859.13 174,638,339.40
Long-term prepaid expenses 9,924,686.56 9,924,686.56
Liabilities:
Current liabilities 283,489,650.27 283,489,650.27
Special payables 1,098,494.94 1,098,494.94
Deferred tax liabilities 418,882,654.24 -
Net assets 3,411,759,293.70 2,155,111,393.60
Less: Minority interests - -
Net assets acquired 3,411,759,293.70 2,155,111,393.60
(2) Operating results and net cash flows of the acquiree from the
acquisition date to the end of the year of business combination
Acquisition date to the
end of the year of
Item
business combination
Ningbo Daxie
Operating income 73,403,212.42
Operating cost and expenses 42,281,862.79
Gross profit 32,101,813.91
Net profit 27,286,541.83
Net cash flows from operating activities 36,940,631.77
Net cash flows from investing activities -3,002,033.17
Net cash flows from financing activities -117,688,708.33
Net increase in cash and cash equivalents (decrease is marked with "-") -83,750,109.73
(3) Gains or losses from remeasurement of equity held prior to acquisition
date at fair value
Gains or losses Method of Amount transferred from
Carrying
Fair value of from determining the fair other comprehensive
amount of
Name of the previously held remeasurement value of previously income to investment
previously held
acquiree equity at the of previously held equity at income in respect of the
equity at the
acquisition date held equity at acquisition date and equity held prior to the
acquisition date
fair value key assumptions acquisition date
Asset-based
Ningbo Daxie 969,800,126.77 1,723,788,876.57 753,988,749.80 -
valuation
- 137 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(VII) EQUITY IN OTHER ENTITIES
1. Interests in subsidiaries
(1) Composition of the Group
Proportion of
Principal Registered capital
Place of ownership Interest
Name of the subsidiary place of Nature of business (RMB'0000, unless Acquisition method
incorporation (%)
business otherwise specified)
Direct Indirect
Shenzhen Chiwan International Freight Agency Shenzhen, Logistics support Established through
Shenzhen, PRC 550 100.00 -
Co., Ltd. PRC services investment
Hong Kong, Hong Kong, Established through
Chiwan Wharf Holdings (Hong Kong) Ltd. Investment holding HKD1,000,000 100.00 -
PRC PRC investment
Dongguan, Dongguan, Logistics support Established through
Dongguan Shenchiwan Port Affairs Co., Ltd. 45,000.00 85.00 -
PRC PRC services investment
Dongguan, Dongguan, Logistics support Established through
Dongguan Shenchiwan Wharf Co., Ltd. 40,000.00 100.00 -
PRC PRC services investment
Business combination
Shenzhen, Logistics support
Shenzhen Chiwan Harbor Container Co. Ltd. Shenzhen, PRC 28,820.00 100.00 - involving enterprises under
PRC services
common control
Business combination
Shenzhen, Logistics support
Shenzhen Chiwan Port Development Co., Ltd. Shenzhen, PRC 1,500.00 100.00 - involving enterprises under
PRC services
common control
Business combination
Shenzhen, Logistics support
Chiwan Container Terminal Co., Ltd. Shenzhen, PRC USD95,300,000 55.00 20.00 involving enterprises under
PRC services
common control
Business combination
Shenzhen, Logistics support
Shenzhen Chiwan Tugboat Co., Ltd. Shenzhen, PRC 2,400.00 100.00 - involving enterprises under
PRC services
common control
Business combination
Hong Kong, Hong Kong, Logistics support
Chiwan Shipping (Hong Kong) Limited HKD80,0000 100.00 - involving enterprises under
PRC PRC services
common control
Business combination
Hong Kong, Hong Kong,
CMPort(Note 1) Investment holding 41.85 - involving enterprises under
PRC PRC HKD42,521,339,900
common control
Business combination
Shenzhen, Logistics support
China Merchants Bonded Logistics Co., Ltd. Shenzhen, PRC 70,000.00 40.00 60.00 involving enterprises under
PRC services
common control
China Merchants Holdings (International)
Business combination
Information Technology Company Limited Shenzhen,
Shenzhen, PRC IT services 5,000.00 23.16 76.84 involving enterprises under
(hereinafter referred to as "International PRC
common control
Information Technology Company")
Business combination
China Merchants International (China) Shenzhen,
Shenzhen, PRC Investment holding USD30,000,000 - 100.00 involving enterprises under
Investment Co., Ltd. PRC
common control
Business combination
China Merchants International Container Qingdao, Logistics support
Qingdao, PRC USD206,300,000 - 100.00 involving enterprises under
Terminal (Qingdao) Co., Ltd. PRC services
common control
Business combination
Hong Kong, Hong Kong, Logistics support
China Merchants Container Services Limited HKD500,000 - 100.00 involving enterprises under
PRC PRC services
common control
Business combination
Shenzhen, Logistics support
China Merchants Port (Shenzhen) Co., Ltd. Shenzhen, PRC 55,000.00 - 100.00 involving enterprises under
PRC services
common control
Project supervision Business combination
Shenzhen,
Shenzhen Haiqin Project Management Co., Ltd. Shenzhen, PRC services 300 - 100.00 involving enterprises under
PRC
common control
Preparation for the Business combination
Shenzhen,
ATJ Shenzhen, PRC warehousing project HKD100,000,000 - 100.00 involving enterprises under
PRC
common control
Preparation for the Business combination
Shenzhen,
ASJ Shenzhen, PRC warehousing project HKD1,000,000 - 100.00 involving enterprises under
PRC
common control
Business combination
China Merchants International Terminal Qingdao, Logistics support
Qingdao, PRC USD44,000,000 - 90.10 involving enterprises under
(Qingdao) Co., Ltd. PRC services
common control
Business combination
Colombo International Container Terminals Logistics support
Sri Lanka Sri Lanka USD150,000,100 - 85.00 involving enterprises under
Limited services
common control
Business combination
Shenzhen, Logistics support
Magang Godown & Wharf (Note 2) Shenzhen, PRC 33,500.00 - 100.00 involving enterprises under
PRC services
common control
Business combination
Shenzhen, Logistics support
Shenzhen Mawan Port Services Co., Ltd. Shenzhen, PRC 20,000.00 - 100.00 involving enterprises under
PRC services
common control
Business combination
Zhangzhou, Zhangzhou, Logistics support
Zhangzhou China Merchants Tugboat Co., Ltd. 1,500.00 - 100.00 involving enterprises under
PRC PRC services
common control
Business combination
Zhangzhou, Zhangzhou, Logistics support
Zhangzhou China Merchants Port Co., Ltd. 100,000.00 - 60.00 involving enterprises under
PRC PRC services
common control
Business combination
Zhangzhou, Zhangzhou, Logistics support
ZCMG (note 2) 44,450.00 - 31.00 involving enterprises under
PRC PRC services
common control
Business combination
Shenzhen, Logistics support
Shekou Container Terminals Ltd. Shenzhen, PRC HKD618,201,200 - 100.00 involving enterprises under
PRC services
common control
- 138 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(VII) EQUITY IN OTHER ENTITIES - continued
1. Interests in subsidiaries - continued
(1) Composition of the Group - continued
Proportion of
Principal Registered capital ownership Interest
Place of
Name of the subsidiary place of Nature of business (RMB'0000, unless Acquisition method
incorporation (%)
business otherwise specified)
Direct Indirect
Business combination
Shenzhen Lianyunjie Container Terminals Co., Shenzhen, Logistics support
Shenzhen, PRC 60,854.90 - 100.00 involving enterprises under
Ltd. PRC services
common control
Business combination
Anxunjie Container Terminals (Shenzhen) Co., Shenzhen, Logistics support
Shenzhen, PRC 127,600.00 - 100.00 involving enterprises under
Ltd. PRC services
common control
Business combination
Anyunjie Port Warehousing Service (Shenzhen) Shenzhen, Preparation for the
Shenzhen, PRC 6,060.00 - 100.00 involving enterprises under
Co., Ltd. PRC warehousing project
common control
Business combination
Shenzhen Haixing Harbor Development Co., Shenzhen, Logistics support
Shenzhen, PRC 53,072.92 - 67.00 involving enterprises under
Ltd PRC services
common control
Business combination
Shenzhen, Logistics support
Shenzhen Lianyongtong Terminal Co., Ltd. Shenzhen, PRC USD7,000,000 - 100.00 involving enterprises under
PRC services
common control
Business combination
Foshan, Logistics support
Yide Port Foshan, PRC 21,600.00 - 51.00 involving enterprises under
PRC services
common control
Business combination
British
Mega Shekou Container Terminals Limited British Virgin Investment holding USD120.00 - 80.00 involving enterprises under
Virgin
common control
Business combination
Thesar Maritime Limited Cyprus Cyprus Investment holding EUR5,000.00 - 100.00 involving enterprises under
common control
The Business combination
The Republic Logistics support
Lome Container Terminal S.A. Republic of XOF200,000,000 - 100.00 involving enterprises under
of Togo services
Togo common control
Business combination
British
Gainpro British Virgin Investment holding USD1.00 - 76.47 involving enterprises under
Virgin
common control
Business combination
Hambantota International Port Group Logistics support
Sri Lanka Sri Lanka USD794,000,000 - 85.00 involving enterprises under
(Private)Limited services
common control
Business combination
Shantou, Logistics support
Shantou port Shantou, PRC 12,500 - 60.00 involving enterprises under
PRC services
common control
Business combination
Shenzhen, Property lease
JYRT Shenzhen, PRC 80,000 - 100.00 involving enterprises under
PRC service, etc.
common control
Business combination
Shenzhen, Property lease
QHW Shenzhen, PRC 20,000 - 100.00 involving enterprises under
PRC service, etc.
common control
Business combination
Shenzhen, Investment
Juzhongzhi Investment (Shenzhen) Co., Ltd. Shenzhen, PRC 4,000 - 75.00 involving enterprises under
PRC consultation
common control
Business combination
Shenzhen, Logistics support
Shenzhen Lianda Tugboat Co., Ltd. Shenzhen, PRC 200 - 60.29 involving enterprises under
PRC services
common control
Business combination
China Ocean Shipping Tally Zhangzhou Co., Zhangzhou, Zhangzhou, Logistics support
200 - 84.00 involving enterprises under
Ltd. PRC PRC services
common control
Business combination
Logistics support
China Merchants Holdings (Djibouti) FZE Djibouti Djibouti USD38,140,000 - 100.00 involving enterprises under
services
common control
Business combination
Xinda Resources Limited (hereinafter referred British
British Virgin Investment holding USD107,620,000 - 77.45 involving enterprises under
to as "Xinda") Virgin
common control
Business combination
Hong Kong, Hong Kong,
Kong Rise Development Limited Investment holding USD107,620,000 - 100.00 involving enterprises under
PRC PRC
common control
Business combination not
Logistics support
TCP Brazil Brazil BRL 68,851,600 - 100.00 involving enterprises under
services
common control
Business combination
Hong Kong, Hong Kong,
Direcet Achieve Investments Limited Investment holding USD814,781,300 - 100.00 involving enterprises under
PRC PRC
common control
Zhoushan, Logistics support
CMPort (Zhoushan) RoRo Logistics Co., Ltd. Zhoushan, PRC 17,307.86 51.00 - Assets acquisition
PRC services
Shenzhen Haixing Logistics Development Co., Shenzhen, Logistics support
Shenzhen, PRC 7,066.79 - 67.00 Assets acquisition
Ltd. PRC services
Business combination not
Zhanjiang, Zhanjiang, Logistics support
Zhanjiang Port 587,420.91 3.42 54.93 involving enterprises under
PRC PRC services
common control
Business combination not
Zhanjiang Port International Container Terminal Zhanjiang, Zhanjiang, Logistics support
60,000.00 - 80.00 involving enterprises under
Co., Ltd. PRC PRC services
common control
- 139 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(VII) EQUITY IN OTHER ENTITIES - continued
1. Interests in subsidiaries - continued
(1) Composition of the Group - continued
Proportion of
Principal Registered capital ownership Interest
Place of
Name of the subsidiary place of Nature of business (RMB'0000, unless Acquisition method
incorporation (%)
business otherwise specified)
Direct Indirect
Business combination not
Zhanjiang Port Petrochemical Terminal Co., Zhanjiang, Zhanjiang, Logistics support
18,000.00 - 50.00 involving enterprises under
Ltd. PRC PRC services
common control
Business combination not
China Ocean Shipping Tally Co., Ltd., Zhanjiang, Zhanjiang, Logistics support
300 - 84.00 involving enterprises under
Zhanjiang PRC PRC services
common control
Business combination not
Zhanjiang Port Donghaidao Bulk Cargo Zhanjiang, Zhanjiang, Logistics support
5,000.00 - 100.00 involving enterprises under
Terminal Co., Ltd. PRC PRC services
common control
Business combination not
Zhanjiang Port Bonded Service Co., Ltd., Zhanjiang, Zhanjiang, Logistics support
300 - 100.00 involving enterprises under
Guangdong PRC PRC services
common control
Business combination not
Zhanjiang, Zhanjiang, Logistics support
Guangdong Zhanjiang Port Logistics Co., Ltd. 10,000.00 - 100.00 involving enterprises under
PRC PRC services
common control
Business combination not
Zhanjiang, Zhanjiang, Logistics support
Zhanjiang Port Haichuan Trading Co., Ltd. 200 - 100.00 involving enterprises under
PRC PRC services
common control
Business combination not
Guangdong Zhanjiang Port Longteng Shipping Zhanjiang, Zhanjiang, Logistics support
9,000.00 - 70.00 involving enterprises under
Co., Ltd. PRC PRC services
common control
Business combination
Ningbo, Logistics support
Ningbo Daxie (Note 4) Ningbo, PRC 120,909.00 - 45.00 involving enterprises under
PRC services
common control
Shantou, Logistics support Established through
Shantou Harbor Towage Service Co., Ltd. Shantou, PRC 1,000.00 - 100.00
PRC services investment
Note 1: On 19 June 2018, the Company and China Merchants Group (Hong Kong) Co., Ltd. ("CMHK") entered
into "Agreement of Concerted Action on China Merchants Port Holdings Company Limited". According
to the agreement, CMHK unconditionally keeps consistent with the Company when voting for the matters
discussed at the general shareholders meeting of CMPort in respect of its voting power of CMPort as
entrusted, and performs the voting as per the Company's opinion.
For July and October 2020, CMPort respectively distributed 2019 dividends and 2020 interim dividends to
shareholders. The shareholders may select to receive the dividends all in cash or shares, or receive the
dividends part in cash and part in new shares. The Company and CMHK select to receive all its share of
dividends from the shareholding in CMPort in the form of scrip dividends. Upon the completion of above
distribution of CMPort, the Company's share in CMPort increased from 1,411,014,033 shares to
1,532,248,957 shares, accounting for 41.85% (previously 40.91%) of the total issued shares of CMPort.
The proportion of shares held by CMHK changed from 21.86% to 22.36%. Therefore, the Company has
total 64.21% voting power of CMPort and has control over CMPort.
- 140 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(VII) EQUITY IN OTHER ENTITIES - continued
1. Interests in subsidiaries - continued
(1) Composition of the Group - continued
Note 2: At the shareholders' meeting held on 17 July 2020, Magang Godown&Wharf a subsidiary of the Company,
approved an absorption agreement with Shenzhen Mawan Port Services Co., Ltd.,
("Mawan Port Services"), another subsidiary of the Company. According to the agreement, Mahaang
Warehouse Code continues as a going concern by absorbing Mawan Port Services which was cancelled
with the settlement date 30 November 2020.
On 22 July 2020, Magang Godown&Wharf and Mawan Port Services, subsidiaries of the Company,
published separate announcements in Shenzhen Special Zone Daily to explain the debt settlement or debt
guarantee of Magang Godown&Wharf and Mawan Port Services, and the debts of both parties before the
merger will continue to be repaid by the existing Magang Godown&Wharf after the merger.
On 13 November 2020, the registration modification with the administration for industry and commerce of
Magang Godown&Wharf and the registration cancellation with the administration for industry and
commerce of Mawan Port Services, subsidiaries of the Company, were completed.
Note 3: The Group and China Merchants Zhangzhou Development Zone Co., Ltd. entered into "Equity Custody
Agreement", according to which China Merchants Zhangzhou Development Zone Co., Ltd. entrusted its
29% equity of ZCMG to the Group for operation and management. Therefore, the Group has 60% voting
power of ZCMG and includes it in the scope of consolidation of the consolidated financial statements.
Note 4: Details are set out in Note (VI) 1.
(2) Material non-wholly-owned subsidiaries
Profit or loss Balance of
Dividends distributed
Proportion of ownership attributable to
Name of the to minority minority interests
interest held by the minority
subsidiary shareholders in the at the end of the
minority shareholders (%) shareholders in the
current year year
current year
CMPort 58.15 3,290,341,491.53 1,271,963,608.20 63,082,766,307.07
- 141 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(VII) EQUITY IN OTHER ENTITIES - continued
1. Interests in subsidiaries - continued
(3) Significant financial information of material non-wholly-owned subsidiaries
Closing balance Opening balance
Name of the
subsidiary Non-current Current Non-current Non-current Current Non-current
Current assets Total assets Total liabilities Current assets Total assets Total liabilities
assets liabilities liabilities assets liabilities liabilities
CMPort 14,625,774,694.50 125,425,081,030.94 140,050,855,725.44 13,055,907,214.63 34,087,468,137.34 47,143,375,351.97 11,159,452,476.24 119,576,502,129.38 130,735,954,605.62 13,858,924,526.23 35,059,524,441.90 48,918,448,968.13
2020 2019
Name of the subsidiary Total Cash flows from Total Cash flows from
Operating income Net profit Operating income Net profit
comprehensive income operating activities comprehensive income operating activities
CMPort 7,956,928,250.59 5,064,412,321.79 3,204,689,765.86 3,629,199,456.13 7,845,242,646.62 7,421,484,985.59 6,327,276,475.35 3,944,044,766.09
- 142 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(VII) EQUITY IN OTHER ENTITIES - continued
2. Transactions resulting in changes in ownership interests in subsidiaries
without losing control over the subsidiaries
(1) Description of changes in ownership interests in subsidiaries
During the year, the Group's ownership interests in CMPort changed from 40.91% to 41.85%. Details are set out in
Note (VII) 1 (1).
In February 2018, China Merchants Port Holdings, a subsidiary of the Company, through its controlling subsidiary
Kong Rise Development Limited, acquired a 90% equity interest in TCP. Under the agreement, the minority
shareholder of TCP holds an option to sell its 10% equity interest in TCP to Kong Rise Development Limited, a
subsidiary of the Group and the controlling shareholder of TCP, at the higher of the market price or BRL 320 million
(the "Put Option"). On 23 February 2020, the minority shareholders of TCP gave notice of exercise to Kong Rise
Development Limited, after which China Merchants Port Holdings increased its capital to Xinda, the wholly-owned
controlling shareholder of Kong Rise Development Limited, by USD107 million, Xinda increased its capital to Kong
Rise Development Limited by USD107 million, and Kong Rise Development Limited paid the minority shareholder
of TCP the full amount of USD107 million for the equity acquisition of approximately RMB755,398,999.97. As of
31 December 2020, the relevant equity transaction has been completed. Upon completion of this transaction, the
shareholding of Kong Rise Development Limited in TCP changed from 90% to 100% and the shareholding of China
Merchants Port Holdings in Xinda changed from 74.9485% to 77.4536%.
In June 2020, China Merchants Port Holdings, a subsidiary of the Company, as seller, Fujian Transportation Maritime
Silk Road, as buyer, and Fujian Provincial Transportation Group Co., Ltd., as guarantor, entered into the "Contract
for Share Transfer of GAINPRO RESOURCES LIMITED", under which China Merchants Port Holdings transferred
about 23.53% of equity in its wholly-owned subsidiary Gainpro and 23.53% of the shareholder loans it provided to
Gainpro to Fujian Transportation Maritime Silk Road with a transaction consideration of USD268,000,000.00. As of
31 December 2020, the relevant equity transaction has been completed. After the completion of this transaction, the
shareholding of China Merchants Port Holdings in Gainpro changed from 100% to 76.47%.
- 143 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(VII) EQUITY IN OTHER ENTITIES - continued
2. Transactions resulting in changes in ownership interests in subsidiaries
without losing control over the subsidiaries - continued
(2) Effect of the transaction on minority interests and equity attributable
to owners of the Company
CMPort TCP Gainpro
Acquisition cost/disposal consideration
- Cash - 755,398,999.97 1,851,325,647.36
- Fair value of non-cash assets 974,063,967.07 - -
Less: Fair value of put options recognized at the
- 170,321,779.31 -
acquisition of TCP controlling interest
Less: Changes in the fair value of put options - 65,259,562.57 -
Less: Shareholder loans transferred to Fujian
- - 1,587,526,138.69
Transportation Maritime Silk Road
Total acquisition cost and disposal consideration 974,063,967.07 519,817,658.09 263,799,508.67
Less: Share of net assets of subsidiaries calculated based
on the proportion of equity acquired to the equity 1,350,167,611.78 -14,691,819.14 -68,314,604.13
disposed
Difference -376,103,644.71 534,509,477.23 332,114,112.80
Including: Adjustment to capital Reserve 376,103,644.71 -534,509,477.23 332,114,112.80
Adjustment to surplus reserve - - -
Adjustment to unappropriated profit - - -
3. Interests in joint ventures and associates
(1) Material joint ventures or associates
Proportion of ownership
Principal Accounting method of
Place of interests held by the Group
Investee place of Nature of business investments in
registration (%)
business associates
Direct Indirect
Associates
Shanghai International Port and container
Shanghai, PRC Shanghai, PRC - 26.77 Equity method
Port (Group) Co., Ltd. terminal business
- 144 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(VII) EQUITY IN OTHER ENTITIES - continued
4. Key financial information of material associates
Shanghai International Port (Group) Co., Ltd.
Closing balance / Opening balance/
Item Amount incurred Amount incurred
in the current in the prior
period period
Current assets 43,653,716,114.59 40,399,631,516.67
Including: Cash and cash equivalents 20,689,734,592.59 17,900,365,675.69
Non-current assets 112,271,033,861.93 101,777,664,401.29
Total assets 155,924,749,976.52 142,177,295,917.96
Current liabilities 22,405,787,626.17 19,339,272,490.14
Non-current liabilities 37,539,362,699.55 32,049,165,771.78
Total liabilities 59,945,150,325.72 51,388,438,261.92
Minority interests 8,461,734,212.94 8,732,108,869.09
Equity attributable to shareholders of the parent company 87,517,865,437.86 82,056,748,786.95
Share of net assets calculated based on the proportion of
23,428,532,577.72 21,966,591,650.27
ownership interests
Adjustments
-Goodwill 2,076,585,747.12 2,076,585,747.12
-Others -143,335,143.43 -125,134,529.84
Carrying amounts of equity investments in associates 25,361,783,181.41 23,918,042,867.55
Fair value of publicly quoted equity investments in
28,345,709,190.02 35,788,783,813.22
associates
Operating income 26,119,460,820.07 36,101,631,985.21
Net profit 9,183,403,328.66 9,925,845,382.34
Other comprehensive income 657,555,565.18 -197,209,230.86
Total comprehensive income 9,840,958,893.84 9,728,636,151.48
Dividends received from associates in the current year 899,371,516.97 955,194,576.56
5. Summarized financial information of immaterial associates and joint
ventures
Opening balance/
Closing balance/Amount
Item Amount accumulated
accumulated in the year
last year
Joint ventures:
Total carrying amount of investments 8,860,743,706.09 9,392,226,566.22
Aggregate of following items calculated based on the
proportion of ownership interest
- Net profit 357,995,555.70 468,699,021.57
- Other comprehensive income 25,430,763.35 -18,718,479.76
- Total comprehensive income 383,426,319.05 449,980,541.81
Associates:
Total carrying amount of investments 32,009,396,535.95 24,606,269,949.49
Aggregate of following items calculated based on the
proportion of ownership interest
- Net profit 1,396,328,157.40 833,229,755.94
- Other comprehensive income 21,687,463.52 -71,060,470.70
- Total comprehensive income 1,418,015,620.92 762,169,285.24
6. The investees where the Group holds long-term equity investments are not
restricted to transfer funds to the Group.
- 145 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(VIII) RISKS ASSOCIATED WITH FINANCIAL INSTRUMENTS
1. Currency risk
Currency risk is the risk that losses will occur because of changes in foreign exchange rates. The Group's exposure to
the currency risk is primarily associated with HKD, USD and EUR. Except for part of the purchases and sales, the
Group's other principal activities are denominated and settled in RMB. As at 31 December 2020, the balance of the
Group's assets and liabilities are both denominated in functional currency, except that the assets and liabilities set out
below are recorded using foreign currency. Currency risk arising from the foreign currency balance of assets and
liabilities may have impact on the Group's performance.
Item Closing balance Opening balance
Cash and bank balances 1,214,901,554.08 829,827,620.81
Accounts receivable 34,261,643.29 134,801,300.52
Other receivables 1,004,843,484.23 558,948,223.20
Long-term receivables - 9,800,295.76
Short-term borrowings 668,320,000.00 1,304,398,148.00
Accounts payable 4,286,809.14 30,431,392.31
Other payables 201,395,071.52 261,684,252.87
Non-current liabilities due within one year 382,131,909.25 261,401,461.04
Long-term borrowings 670,000,000.00 976,546,725.00
Bonds payable 2,500,000,000.00 2,500,000,000.00
Long-term payables 440,659,667.97 431,361,402.17
The Group closely monitors the effects of changes in the foreign exchange rates on the Group's currency risk
exposures. According to the current risk exposure and judgment of the exchange rate movements, management
considers it is unlikely that the exchange rate changes in the future one year will result in significant loss to the Group.
Sensitivity analysis on currency risk
The assumption for the sensitivity analysis on currency risk is that all the cash flow hedges and hedges of a net
investment in a foreign operation are highly effective. On the basis of the above assumption, where all other variables
are held constant, the reasonably possible changes in the foreign exchange rate may have the following pre-tax effect
on the profit or loss for the period and shareholders' equity:
Closing balance Opening balance
Effect on Effect on
Item Changes in exchange rate Effect Effect
shareholders' shareholders'
on profits on profits
equity equity
All foreign currencies 5% increase against RMB -577,260.66 -577,260.66 -17,661,467.60 -17,661,467.60
All foreign currencies 5% decrease against RMB 577,260.66 577,260.66 17,661,467.60 17,661,467.60
All foreign currencies 5% increase against USD 1,578,468.63 1,578,468.63 -7,574,539.96 -7,574,539.96
All foreign currencies 5% decrease against USD -1,578,468.63 -1,578,468.63 7,574,539.96 7,574,539.96
All foreign currencies 5% increase against HKD -131,469,479.65 -131,469,186.05 -97,677,880.50 -97,677,880.50
All foreign currencies 5% decrease against HKD 131,469,479.65 131,469,186.05 97,677,880.50 97,677,880.50
All foreign currencies 5% increase against FCFA -171,067.13 -171,067.13 -41,707,232.31 -41,707,232.31
All foreign currencies 5% decrease against FCFA 171,067.13 171,067.13 41,707,232.31 41,707,232.31
- 146 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(VIII) RISKS ASSOCIATED WITH FINANCIAL INSTRUMENTS - continued
2. Interest rate risk - changes in cash flows
Risk of changes in cash flows of financial instruments arising from interest rate changes is mainly related to bank
loans with floating interest rate. (See Note (V) 26 and Note (V) 36). The Group continuously and closely monitors the
impact of interest rate changes on the Group's interest rate risk. The Group's policy is to maintain these borrowings at
floating rates. Presently, the Group has no arrangement such as interest rate swaps etc.
Sensitivity analysis of interest rate risk
Sensitivity analysis of interest rate risk is based on the following assumptions:
Fluctuations of market interest rate can affect the interest income or expense of a financial
instrument with floating interest rate;
For a financial instrument at fair value with fixed interest rate, the fluctuations of market interest
rate can only affect its interest income or expense;
For a derivative financial instrument designated as hedging instrument, the fluctuations of market
interest rate affect its fair value, and all interest rate hedging are expected to be highly effective;
The changes in fair value of derivative financial instruments and other financial assets and
liabilities are calculated using cash flow discounting method by applying the market interest rate at
balance sheet date.
On the basis of above assumptions, where the other variables held constant, the pre-tax effect of possible and
reasonable changes in interest rate on the profit or loss for the period and shareholders' equity are as follows:
Closing balance Opening balance
Changes in Effect on Effect on
Item
interest rate Effect on profits shareholders' Effect on profits shareholders'
equity equity
Short-term borrowings and
1% increase -133,940,312.35 -133,940,312.35 -126,905,885.92 -126,905,885.92
long-term borrowings
Short-term borrowings and
1% decrease 133,940,312.35 133,940,312.35 126,905,885.92 126,905,885.92
long-term borrowings
3. Liquidity risk
In the management of the liquidity risk, the Group monitors and maintains a level of cash and cash equivalents
deemed adequate by the management to finance the Group's operations and mitigate the effects of fluctuations in cash
flows. The management monitors the utilisation of bank borrowings and ensures compliance with loan covenants.
As of 31 December 2020, the Group had total current liabilities in excess of total current assets of
RMB3,870,940,636.24. As at 31 December 2020, the Group has available unutilized loan facility of
RMB45,605,365,637.62 which is more than current liabilities. Therefore, the Group's management believes that the
Group has no significant liquidity risk.
- 147 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(VIII) RISKS ASSOCIATED WITH FINANCIAL INSTRUMENTS - continued
3. Liquidity risk - continued
The following is the maturity analysis for financial assets and financial liabilities held by the Group which is based on
undiscounted remaining contractual obligations:
Item Carrying amount Gross amount Within 1 year 1 to 5 years Over 5 years
Short-term borrowings 10,483,775,548.93 10,589,325,476.51 10,589,325,476.51 - -
Notes payable 7,081,772.32 7,081,772.32 7,081,772.32 - -
Accounts payable 599,112,028.98 599,112,028.98 599,112,028.98 - -
Other payables 2,456,700,897.60 2,456,700,897.60 2,456,700,897.60 - -
Non-current liabilities due
3,511,343,186.37 4,990,744,868.69 4,990,744,868.69 - -
within one year
Other current liabilities 2,383,668,985.94 2,397,840,643.47 2,397,840,643.47 - -
Long-term borrowings 7,406,322,693.80 8,295,674,700.92 - 6,597,478,594.75 1,698,196,106.17
Bonds payable 21,090,545,845.56 23,576,837,902.76 - 19,195,987,479.27 4,380,850,423.49
Lease liabilities 1,327,423,748.05 2,054,269,999.66 - 804,396,870.36 1,249,873,129.30
Long-term payables 1,188,465,420.57 1,289,219,203.17 - 26,864,969.61 1,262,354,233.56
Other non-current
2,821,122,944.90 2,821,122,944.90 - 246,057,524.18 2,575,065,420.72
liabilities
(IX) DISCLOSURE OF FAIR VALUE
1. Closing balance of assets and liabilities measured at fair value
Fair value at the end of the year
Level 1 Level 2 Level 3
Item
Measured at Measured at Measured at fair Total
fair value fair value value
Measurements at fair value
continuously
Held-for-trading financial assets 165,448.59 - 850,000,000.00 850,165,448.59
Receivables financing - 217,449,966.41 - 217,449,966.41
Other equity instrument investments 10,786,800.00 - 170,680,257.74 181,467,057.74
Other non-current financial assets 886,385,139.77 - 24,422,312.79 910,807,452.56
Total assets measured at fair value
897,337,388.36 217,449,966.41 1,045,102,570.53 2,159,889,925.30
continuously
Other non-current liabilities - - 2,888,395,641.53 2,888,395,641.53
Total liabilities measured at fair value
- - 2,888,395,641.53 2,888,395,641.53
continuously
2. Basis for determining the market price of items continuously measured at
level 1 fair value
The market prices of other equity instrument investments and other non-current financial assets are determined at the
closing price of the equity instrument at Shanghai Stock Exchange and Hong Kong Stock Exchange at 31 December
2020.
- 148 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(IX) DISCLOSURE OF FAIR VALUE - continued
3. Qualitative and quantitative information of valuation techniques and key
parameters adopted for items continuously measured at level 2 fair value
Fair value at the end
Item Valuation techniques Inputs
of this year
Receivables financing 217,449,966.41 Cash flow discounting Discount rate
The fair value of non-listed equity instruments included in equity instruments at fair value through profit or loss is
determined using the valuation techniques such as listed company comparison approach etc. During the valuation, the
Group needs to make estimates in respect of market volatility and relevance etc., select appropriate discount rate and
take into consideration of adjustment of discount and premium.
4. Qualitative and quantitative information of valuation techniques and key
parameters adopted for items continuously measured at level 3 fair value
Fair value at the end
Item Valuation techniques Inputs
of this year
Held-for-trading financial assets 850,000,000.00 Cash flow discounting Discount rate
Other equity instrument investments 170,680,257.74 Net worth method Carrying amount
Other non-current financial assets 2,000,000.00 Cash flow discounting Discount rate
Other non-current financial assets 667,822.80 Net worth method Carrying amount
Listed company comparison
Other non-current financial assets 21,754,489.99 Share price
approach
Other non-current liabilities 2,888,395,641.53 Cash flow discounting Discount rate
The fair value of non-listed equity instruments included in equity instruments at fair value through profit or loss or
other comprehensive income is determined using the valuation techniques such as cash flow discounting method, net
worth method, listed company comparison approach etc. During the valuation, the Group needs to make estimates in
respect of the future cash flows, credit risk, market volatility and relevance etc., select appropriate discount rate and
take into consideration of adjustment of discount and premium.
5. Fair value of financial assets and financial liabilities not measured at
fair value
The financial assets and liabilities not measured at fair value mainly include: notes receivable, accounts receivable,
other receivables, short-term borrowings, notes payable, accounts payable, other payables, long-term borrowings,
bonds payable, lease liabilities and long-term payables etc.
The Group's management believes that the carrying amounts of financial assets and financial liabilities at amortized
cost in the financial statements approximate their fair values.
The fair value of bonds payable traded in active market is determined at the quoted price in the active market. The
fair values of long-term borrowings, long-term payables and bonds payable not traded in active market are
determined at the present value of contractual future cash flows discounted using the interest rate for providing nearly
the same cash flows to entity with comparable credit rating under the same conditions.
- 149 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(X) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS
1. Parent of the Company
Proportion of the
Proportion of the
Related party Place of Company's ownership
Name of the parent Type of the entity Nature of business Issued share capital Company's voting power
relationship registration interests held by the
held by the parent (%)
parent (%)
Broadford Global Limited Parent company Private limited company (share limited) Hong Kong Investment holding HKD 21,120,986,262 2.88 81.92 (Note)
Note: Broadford Global Limited directly holds 2.88% equity of the Company, and indirectly holds 19.29% and 59.75% equity of the Company through the subsidiaries China
Merchants Gangtong Development (Shenzhen) Co., Ltd. and China Merchants Port Investment Development Company Limited (formerly known as China Merchants
Investment Development Co., Ltd.) respectively. The ultimate controlling shareholder of the Company is China Merchants Group.
2. Subsidiaries of the Company
Details of the subsidiaries of the Company are set out in Note (VII) 1.
- 150 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(X) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
3. Associates and joint ventures of the Company
Details of the Company's significant joint ventures and associates are set out in Note (VII) 3.
Other joint ventures or joint ventures that occurred related party transactions and formed balances with the Group this
year are as follows:
Name of joint venture or associate Relationship with the Company
Port of Newcastle and its subsidiaries Joint venture
Guizhou East Land Port Operation Co., Ltd. Joint venture
Previously a joint venture
Guangdong Zhanjiang Port Longteng Shipping Co., Ltd.
(currently a subsidiary)
Previously a joint venture
Ningbo Daxie (Note 1)
(currently a subsidiary)
Qingdao Qianwan United Container Terminal Co., Ltd. Joint venture
Qingdao Qianwan West Port United Wharf Co., Ltd. Joint venture
Qingdao Qianwan New United Container Terminal Co., Ltd. Joint venture
COSCO Logistics (Zhanjiang) Co., Ltd. Joint venture
China Merchants Antong Logistics Management Company Joint venture
China Ocean Shipping Agency (Zhanjiang) Co., Ltd Joint venture
Yantai Port Group Laizhou Port Co., Ltd. Joint venture
Qingdao Wutong Century Supply Chain Co., Ltd. Joint venture
Kumport Liman Hizmetleri ve Lojistik Sanayi ve Ticaret Anonim irketi Joint venture
Doraleh Multi-purpose Port Associate
Great Horn Development Company FZCo Associate
International Djibouti Industrial Parks Operation FZCo Associate
Port de Djibouti S.A. Associate
Terminal Link SAS Associate
Tin-Can Island Container Terminal Ltd Associate
Guizhou Qiandongnan Continental Land Port Operation Co., Ltd. Associate
Nanshan Group and its subsidiaries Associate
Shanghai International Port (Group) Co., Ltd. Associate
Shenzhen Baohong E-Commerce Integrated Services Co., Ltd. Associate
Tianjin Haitian Bonded Logistics Co., Ltd. Associate
Modern Terminals Limited Associate
Zhanjiang CMHK Investment Co., Ltd. Associate
Zhanjiang Xiagang United Development Co., Ltd. Associate
Zhangzhou COSCO Shipping Agency Co., Ltd. Associate
Chu Kong River Trade Terminal Co. Ltd. Associate
Dalian Port Logistics Technology Co. Ltd. Associate
China United Tally Co., Ltd. Shantou Associate
Shantou International Container Terminals Limited Associate
Shenzhen Bay Electricity Industry Co., Ltd. Associate
- 151 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(X) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
4. Other related parties of the Company
Name of other related parties Relationship with the Company
Yihai Kerry Golden Arowana Cereals, Oils and Foodstuffs Co., Minority shareholder of subsidiary
Ltd.
Zhanjiang Infrastructure Construction Investment Group Co., Ltd. Minority shareholder of subsidiary
Zhoushan Blue Ocean Investment Co., Ltd. Minority shareholder of subsidiary
Sri Lanka Ports Authority Minority shareholder of subsidiary
Antong Holdings Co., Ltd. and its subordinate companies (Note 2) Same related natural person
China COSCO Shipping Group and its subsidiaries (Note 2) Same related natural person
CMHK Controlled by the same ultimate controlling shareholder
Sinotrans (NZ) Limited Controlled by the same ultimate controlling shareholder
Sinotrans Guangdong Co., Ltd. Controlled by the same ultimate controlling shareholder
China Marine Shipping Agency Guangdong Co., Ltd. Controlled by the same ultimate controlling shareholder
Hoi Tung (Shanghai) Company Limited Controlled by the same ultimate controlling shareholder
South China Sinotrans Supply Chain Management Co., Ltd. Controlled by the same ultimate controlling shareholder
EuroAsia Dockyard Enterprise and Development Limited Controlled by the same ultimate controlling shareholder
Qingdao Bonded Logistics Park Sinotrans Warehousing Logistics Controlled by the same ultimate controlling shareholder
Co., Ltd.
Qingdao Sinotrans Supply Chain Management Co., Ltd. Controlled by the same ultimate controlling shareholder
Penavico Shenzhen Warehousing Co., Ltd. Controlled by the same ultimate controlling shareholder
Shenzhen Nanyou (Holdings) Ltd. Controlled by the same ultimate controlling shareholder
Sinotrans Shenzhen Qianhai Supply Chain Management Ltd. Controlled by the same ultimate controlling shareholder
Shenzhen Qianhai Shekou Free Trade Investment Development Controlled by the same ultimate controlling shareholder
Co. Ltd.
Shenzhen West Port Security Service Company Controlled by the same ultimate controlling shareholder
China Merchants Landmark (Shenzhen) Co., Ltd. Controlled by the same ultimate controlling shareholder
China Merchants International Shipping Agency (Shenzhen) Co., Controlled by the same ultimate controlling shareholder
Ltd.
China Merchants Real Estate (Shenzhen) Co., Ltd. Controlled by the same ultimate controlling shareholder
China Merchants (Shenzhen) Power Supply., Ltd. Controlled by the same ultimate controlling shareholder
China Merchants Shenzhen Ro-Ro Shipping Co., Ltd. Controlled by the same ultimate controlling shareholder
China Merchants Commercial Property Investment (Shenzhen) Controlled by the same ultimate controlling shareholder
Co., Ltd.
China Merchants Property Management (Shenzhen) Co., Ltd. Controlled by the same ultimate controlling shareholder
China Marine Shipping Agency Shenzhen Co., Ltd. Controlled by the same ultimate controlling shareholder
Yiu Lian Dockyards (Shekou) Limited Controlled by the same ultimate controlling shareholder
Yiu Lian Dockyards Limited Controlled by the same ultimate controlling shareholder
China Merchants Houlder Insurance Consulting Co., Ltd. Controlled by the same ultimate controlling shareholder
China Merchants International Cold Chain (Shenzhen) Company Controlled by the same ultimate controlling shareholder
Limited
China Merchants Group Finance Company Limited Controlled by the same ultimate controlling shareholder
China Merchants Port Investment Development Company Limited Controlled by the same ultimate controlling shareholder
China Merchants Life Insurance Company Limited Controlled by the same ultimate controlling shareholder
China Merchants Finance Lease (Tianjin) Co., Ltd. Controlled by the same ultimate controlling shareholder
China Merchants Shekou Industrial Zone Holdings Co., Ltd. Controlled by the same ultimate controlling shareholder
China Merchant Food (China) Co., Ltd. Controlled by the same ultimate controlling shareholder
China Merchants Tongshang Finance Lease Co., Ltd. Controlled by the same ultimate controlling shareholder
China Merchants Logistics Group Qingdao Co., Ltd. Controlled by the same ultimate controlling shareholder
China Merchants Zhangzhou Development Zone Power Supply Controlled by the same ultimate controlling shareholder
Co., Ltd.
China Merchants Securities Co., Ltd. Controlled by the same ultimate controlling shareholder
China Traffic Import and Export Co., Ltd. Controlled by the same ultimate controlling shareholder
China Merchants Your Cellar (Shenzhen) Co., Ltd. Controlled by the same ultimate controlling shareholder
China Marine Shipping Agency Guangdong Co., Ltd. Controlled by the same ultimate controlling shareholder
- 152 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(X) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
4. Other related parties of the Company - continued
Name of other related parties Relationship with the Company
China Merchants Healthcare (Qichun) Co., Ltd. Controlled by the same ultimate controlling shareholder
China Ocean Shipping Tally Shenzhen Co., Ltd. Controlled by the same ultimate controlling shareholder
Sinotrans Air Transportation Development Co., Ltd. Controlled by the same ultimate controlling shareholder
Sinotrans Central China Co., Ltd. Controlled by the same ultimate controlling shareholder
Portx.cn Controlled by the same ultimate controlling shareholder
Sinotrans (HK) Shipping Limited Controlled by the same ultimate controlling shareholder
Sinoway Shipping Ltd. Controlled by the same ultimate controlling shareholder
China Merchants (Liaoning) Port Development Co., Ltd. Controlled by the same ultimate controlling shareholder
China Merchants Heavy Industry (Jiangsu) Co., Ltd. Controlled by the same ultimate controlling shareholder
Sinotrans Shantou Co., Ltd. Controlled by the same ultimate controlling shareholder
China Merchants Holdings (Hong Kong) Company Limited Controlled by the same ultimate controlling shareholder
Guangzhou Hangshang Int'l Shipping Agency Co., Ltd. Controlled by the same ultimate controlling shareholder
Shenzhen China Merchants Shekou Asset Management Co., Ltd. Controlled by the same ultimate controlling shareholder
China Yangtze Shipping Group Wuhan Real Estate Co., Ltd. Controlled by the same ultimate controlling shareholder
China Merchants Apartment Development (Shenzhen) Co., Ltd. Controlled by the same ultimate controlling shareholder
Shenzhen Wanhai Mansion Management Co., Ltd. Controlled by the same ultimate controlling shareholder
China Merchants Godown, Wharf & Transportation Co., Ltd. Controlled by the same ultimate controlling shareholder
China Merchants-Logistics Shenzhen Co., Ltd. Controlled by the same ultimate controlling shareholder
China Merchants Zhangzhou Development Zone Co., Ltd. Controlled by the same ultimate controlling shareholder
China Ocean Shipping Agency Shenzhen Controlled by the same ultimate controlling shareholder
China Marine Shipping Agency Ningbo Co., Ltd. Controlled by the same ultimate controlling shareholder
Sinotrans Container Lines (Hong Kong) Company Limited Controlled by the same ultimate controlling shareholder
Sinotrans Container Lines Co., Ltd. Controlled by the same ultimate controlling shareholder
Hoi Tung Innotek (Shenzhen) Co., Ltd. Controlled by the same ultimate controlling shareholder
Shenzhen Science and Technology University Phase II Real Estate Original controlled by the ultimate controlling shareholder
Management Co., Ltd.
With significant influence from the ultimate controlling
Khor Ambado FZCo
shareholder
With significant influence from the ultimate controlling
Djibouti International Hotel Company
shareholder
With significant influence from the ultimate controlling
China Merchant Bank Co., Ltd.
shareholder
With significant influence from the ultimate controlling
Shenzhen China Merchants Port Trade Center for Sea-land Materials
shareholder
Note 1: Refer to Note (VI) 1. It's no longer a related party of the Group since 19 November 2020.
Note 2: The Company's former Chairman Fu Gangfeng (resigned on 31 January 2020) worked as the director and
general manager of China COSCO Shipping Corporation Limited within 12 months after his departure.
From 1 January 2020 to 27 March 2020, the Company's deputy general manager Zheng Shaoping worked
both as the senior management personnel of the Company and as the Chairman of the Board of Antong
Holding Co., Ltd. From September 25 to October 11, 2020, the Company's Deputy General Manager
Zheng Shaoping worked as the Company's senior management and the member of board of directors of
Antong Holdings Co., Ltd. From October 12, 2020 to December 31, 2020, the Company's Deputy General
Manager Zheng Shaoping, served both as the senior management of the company and as the chairman of
Antong Holding Co., Ltd. Therefore, the related party transactions and balances for the period in which
the aforesaid two persons were the director, senior management personnel of China COSCO Shipping
Corporation Limited and Antong Holdings Co., Ltd. and for the 12 months after such period are disclosed.
- 153 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(X) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions
(1) Rendering and receipt of service
Pricing method
and decision Amount incurred Amount incurred
Related party Content of transaction procedures of in the current in the prior
related period period
transactions
Receipt of service:
Nanshan Group and its subsidiaries Service expenditure Negotiation 29,612,136.31 59,399,028.43
Shenzhen Bay Electricity Industry Co., Ltd. Service expenditure Negotiation 29,148,667.42 -
Qingdao Qianwan West Port United Wharf Co., Ltd. Service expenditure Negotiation 16,335,069.80 18,116,312.14
Hoi Tung (Shanghai) Company Limited Service expenditure Negotiation 9,886,142.11 1,472,835.51
Yiu Lian Dockyards Limited Service expenditure Negotiation 9,274,213.41 11,822,773.93
China Merchants Commercial Property Investment (Shenzhen)
Service expenditure Negotiation 6,616,945.42 8,063,768.58
Co., Ltd.
China Merchants Property Management (Shenzhen) Co., Ltd. Service expenditure Negotiation 844,512.39 2,496,785.30
COSCO Logistics (Zhanjiang) Co., Ltd. Service expenditure Negotiation 5,078,367.51 5,302,779.67
China Merchants Zhangzhou Development Zone Power Supply
Service expenditure Negotiation 4,548,046.20 5,050,730.12
Co., Ltd.
Shenzhen West Port Security Service Company Service expenditure Negotiation 4,159,456.50 -
China Marine Shipping Agency Shenzhen Co., Ltd. Service expenditure Negotiation 2,403,262.96 2,998,142.60
China Merchants Your Cellar (Shenzhen) Co., Ltd. Service expenditure Negotiation 2,201,965.59 1,887,287.74
Djibouti International Hotel Company Service expenditure Negotiation 2,028,556.99 -
China Marine Shipping Agency Guangdong Co., Ltd. Service expenditure Negotiation 1,994,707.90 98,489.92
China Merchants Life Insurance Company Limited Service expenditure Negotiation 1,828,798.25 1,674,762.08
China Merchant Food (China) Co., Ltd. Service expenditure Negotiation 1,790,459.66 7,720.06
China Merchants Logistics Group Qingdao Co., Ltd. Service expenditure Negotiation 1,506,882.06 4,291,294.93
China Merchants Healthcare (Qichun) Co., Ltd. Service expenditure Negotiation 1,473,607.08 -
China Ocean Shipping Tally Shenzhen Co., Ltd. Service expenditure Negotiation 1,208,224.86 1,168,331.49
Dalian Port Logistics Technology Co., Ltd. Service expenditure Negotiation 1,068,592.04 -
China Merchants Houlder Insurance Consulting Co., Ltd. Service expenditure Negotiation 273,247.88 2,475,979.40
China Traffic Import and Export Co., Ltd. Service expenditure Negotiation 224,342.82 1,076,783.22
Sinotrans Air Transportation Development Co., Ltd. Service expenditure Negotiation - 1,178,932.56
China Merchants (Shenzhen) Power Supply Co., Ltd. Service expenditure Negotiation - 2,611,504.71
Other related parties Service expenditure Negotiation 5,120,243.27 5,718,581.57
China Merchants Property Management (Shenzhen) Co., Ltd. Property utilities Negotiation 7,567,376.65 19,706,450.63
Nanshan Group and its subsidiaries Property utilities Negotiation - 5,923,767.12
Other related parties Property utilities Negotiation 1,269,101.74 2,114,730.66
China Merchants Finance Lease (Tianjin) Co., Ltd. Lease service fee Negotiation - 6,447,169.81
Purchase of wealth
China Merchants Bank Co., Ltd. Negotiation 850,000,000.00 -
management products
China Merchants Group Finance Company Limited Interest expense Negotiation 40,218,054.32 42,581,045.29
China Merchant Bank Co., Ltd. Interest expense Negotiation 2,820,905.00 3,618,321.05
Port de Djibouti S.A. Interest expense Negotiation - 7,364,273.28
Total 1,040,501,886.14 224,668,581.80
- 154 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(X) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions - continued
(1) Rendering and receipt of service - continued
Pricing method
and decision Amount incurred Amount incurred
Related party Content of transaction procedures of in the current in the prior
related period period
transactions
Rendering of service:
China COSCO Shipping Group and its subsidiaries Service revenue Negotiation 473,089,186.47 128,551,617.88
COSCO Logistics (Zhanjiang) Co., Ltd. Service revenue Negotiation 138,294,236.96 142,786,686.45
Antong Holdings Co., Ltd. and its subordinate companies Service revenue Negotiation 127,713,616.40 30,031,214.77
China Marine Shipping Agency Guangdong Co., Ltd. Service revenue Negotiation 61,942,724.25 33,230,929.57
China Marine Shipping Agency Zhanjiang Co., Ltd Service revenue Negotiation 53,774,870.23 48,467,968.01
Qingdao Qianwan United Container Terminal Co., Ltd. Service revenue Negotiation 49,104,741.77 54,976,948.20
Shantou International Container Terminals Limited Service revenue Negotiation 15,018,042.39 -
China Ocean Shipping Agency Shenzhen Service revenue Negotiation 11,872,191.59 22,026,784.26
Port de Djibouti S.A. Service revenue Negotiation 10,943,478.47 -
China Merchants Ocean Shipping Agency ShenZhen Service revenue Negotiation 10,407,471.90 5,516,336.45
Shenzhen Baohong E-Commerce Integrated Services Co., Ltd. Service revenue Negotiation 9,183,840.58 7,624,557.93
Yiu Lian Dockyards (Shekou) Limited Service revenue Negotiation 6,825,979.02 5,818,220.17
China Merchants International Cold Chain (Shenzhen) Company
Service revenue Negotiation 6,781,159.20 6,487,127.00
Limited
Penavico Shenzhen Warehousing Co., Ltd. Service revenue Negotiation 6,450,089.03 424,691.17
Sinotrans Container Lines Co., Ltd. Service revenue Negotiation 5,752,204.72 4,173,590.92
South China Sinotrans Supply Chain Management Co., Ltd. Service revenue Negotiation 5,730,351.44 3,574,103.34
Sinotrans Shenzhen Qianhai Supply Chain Management Ltd. Service revenue Negotiation 5,366,080.32 1,073,773.97
China Marine Shipping Agency Shenzhen Co., Ltd. Service revenue Negotiation 4,566,415.18 7,924,860.20
Ningbo Daxie Service revenue Negotiation 4,212,324.06 3,973,305.23
Portx.cn Service revenue Negotiation 3,627,717.89 -
Sinotrans (HK) Shipping Limited Service revenue Negotiation 3,516,284.75 -
Qingdao Qianwan West Port United Wharf Co., Ltd. Service revenue Negotiation 3,403,438.43 9,297,044.19
Qingdao Qianwan United Container Terminal Co., Ltd. Service revenue Negotiation 3,147,064.19 3,165,271.40
China Marine Shipping Agency Guangdong Co., Ltd. Service revenue Negotiation 2,771,236.94 637,333.96
Sinoway Shipping Ltd. Service revenue Negotiation 2,380,557.22 101,246.40
Guizhou Qiandongnan Continental Land Port Operation Co., Ltd. Service revenue Negotiation 2,006,774.37 4,995,026.14
China Merchants (Liaoning) Port Development Co., Ltd. Service revenue Negotiation 1,886,792.45 -
China Merchants Port Investment Development Company
Service revenue Negotiation 1,870,575.47 -
Limited
Guizhou East Land Port Operation Co., Ltd. Service revenue Negotiation 1,854,382.19 5,538,484.09
Qingdao Bonded Logistics Park Sinotrans Warehousing Logistics
Service revenue Negotiation 1,777,701.97 1,855,239.95
Co., Ltd.
China Merchants Heavy Industry (Jiangsu) Co., Ltd. Service revenue Negotiation 1,771,945.79 54,339.62
Shantou Zhonglian Tally Co., Ltd. Service revenue Negotiation 1,720,385.71 -
Shanghai International Port (Group) Co., Ltd. Service revenue Negotiation 1,631,054.72 1,588,035.85
Yantai Port Group Laizhou Port Co., Ltd. Service revenue Negotiation 1,448,756.38 1,775,122.48
Doraleh Multi-purpose Port Service revenue Negotiation 1,396,158.59 1,062,268.33
Zhanjiang CMHK Investment Co., Ltd. Service revenue Negotiation 1,226,801.94 -
International Djibouti Industrial Parks Operation
Service revenue Negotiation 1,219,559.23 5,109,432.57
FZCo
Terminal Link SAS Service revenue Negotiation 1,203,144.53 1,362,717.34
Zhangzhou COSCO Shipping Agency Co., Ltd. Service revenue Negotiation 1,171,144.27 2,465,482.40
Sinotrans Central China Co., Ltd. Service revenue Negotiation 1,097,750.34 -
Sinotrans Container Lines (Hong Kong) Co., Ltd. Service revenue Negotiation 1,049,302.38 2,211,004.97
China Merchants-Logistics Shenzhen Co., Ltd. Service revenue Negotiation 1,007,155.73 1,267,111.56
Qingdao Sinotrans Supply Chain Management Co., Ltd. Service revenue Negotiation 902,612.31 1,643,202.86
Nanshan Group and its subsidiaries Service revenue Negotiation 822,683.39 1,000,829.05
Sinotrans Shantou Co., Ltd. Service revenue Negotiation 747,042.39 1,142,737.27
CMHK Service revenue Negotiation 126,500.00 1,412,000.00
Qingdao Wutong Century Supply Chain Co., Ltd. Service revenue Negotiation 99,572.06 2,061,301.86
Great Horn Development Company FZCo Service revenue Negotiation - 2,492,673.00
Khor Ambado FZCo Service revenue Negotiation - 13,593,100.08
Kumport Liman Hizmetleri ve Lojistik Sanayi ve
Service revenue Negotiation - 1,200,615.17
Ticaret Anonim irketi
Sinotrans (NZ) Limited Service revenue Negotiation - 6,191,950.42
- 155 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(X) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions - continued
(1) Rendering and receipt of service - continued
Pricing method
and decision Amount incurred Amount incurred
Related party Content of transaction procedures of in the current in the prior
related period period
transactions
Rendering of service:
Guangdong Zhanjiang Port Longteng Shipping Co., Ltd. Service revenue Negotiation 4,250,943.39
Shenzhen China Merchants Shekou Asset Management Co., Ltd. Service revenue Negotiation - 2,297,545.50
Shenzhen Zhaogang Sea and Land Material Trade Center Service revenue Negotiation - 2,026,044.81
Other related parties Service revenue Negotiation 10,373,324.37 8,690,168.35
Port of Newcastle and its subsidiaries Interest income Negotiation 61,452,466.62 62,584,543.33
Zhanjiang CMHK Investment Co., Ltd. Interest income Negotiation 34,310,102.60 48,716,656.41
China Merchant Bank Co., Ltd. Interest income Negotiation 25,077,926.86 26,074,287.83
Terminal Link SAS Interest income Negotiation 130,683,767.31 56,993.75
China Merchants Group Finance Company Limited Interest income Negotiation 17,071,627.25 7,814,725.11
Tianjin Haitian Bonded Logistics Co., Ltd. Interest income Negotiation 1,507,141.63 1,394,695.28
Khor Ambado FZCo Interest income Negotiation - 18,187,714.88
Other related parties Interest income Negotiation 39,343.77 3,811.07
Total 1,334,428,800.02 761,984,416.19
(2) Leases with related parties
The Group as the lessor:
Pricing method
and decision Lease income Lease income
Name of the lessee Type of leased assets procedures of recognized in recognized in
related the current year the prior year
transactions
Qingdao Qianwan West Port United Wharf Co.,
Port and terminal facilities Negotiation 9,530,634.40 4,571,984.36
Ltd.
Qingdao Bonded Logistics Park Sinotrans
Buildings and structures Negotiation 5,246,389.08 3,816,263.45
Warehousing & Logistics Co., Ltd.
China Merchant Food (China) Co., Ltd. Buildings and structures Negotiation 4,979,293.98 5,675,752.58
China Traffic Import and Export Co., Ltd. Buildings and structures Negotiation 4,791,084.02 3,943,926.21
Qingdao Sinotrans Supply Chain Management
Buildings and structures Negotiation 3,937,228.69 2,678,324.75
Co., Ltd.
Yiu Lian Dockyards (Shekou) Limited Buildings and structures Negotiation 2,612,180.18 2,441,075.14
Nanshan Group and its subsidiaries Buildings and structures Negotiation 2,451,852.32 2,698,718.83
Qingdao Qianwan United Container Terminal
Buildings and structures Negotiation 2,402,484.55 -
Co., Ltd.
China Merchants Securities Co., Ltd. Buildings and structures Negotiation 2,364,578.34 2,330,741.02
Qingdao Wutong Century Supply Chain Co.,
Buildings and structures Negotiation 960,707.68 1,082,330.31
Ltd.
Buildings and structures, land
Other related parties Negotiation 6,612,178.37 3,441,589.35
use rights
Total 45,888,611.61 32,680,706.00
- 156 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(X) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions - continued
(2) Leases with related parties - continued
The Group as the lessee:
Lease term (disclose the
Other significant lease
Name of the lessor Type of leased assets Rental (year) period covered by
terms
contract)
China Merchants Finance Lease (Tianjin) Port and terminal 19 March 2018 -26
103,616,724.54 N/A
Co., Ltd. facilities March 2024
Machinery
China Merchants Finance Lease (Tianjin) 30 November 2018 -30
equipment, port and 63,602,263.89 N/A
Co., Ltd. November 2024
terminal facilities
Buildings and 1 January 2019 - 31
Nanshan Group and its subsidiaries 57,094,005.40 N/A
structures December 2023
China Merchants Tongshang Finance Machinery 31 October 2017 -27
46,381,918.54 N/A
Lease Co., Ltd. equipment October 2023
China Merchants Shekou Industrial Zone Port and terminal 1 January 2020 - 31
35,385,536.56 N/A
Holdings Co., Ltd. facilities December 2021
China Merchants Tongshang Finance Machinery 26 December 2016 -15
17,717,147.04 N/A
Lease Co., Ltd. equipment November 2022
EuroAsia Dockyard Enterprise and Port and terminal 1 January 2020 - 31
14,633,851.19 N/A
Development Limited facilities December 2020
China Merchants Shekou Industrial Zone 1 January 2020 - 31
Other 5,823,873.60 N/A
Holdings Co., Ltd. December 2020
With progressively
Shenzhen Qianhai Shekou Free Trade 1 March 2020 - 31 decreasing rent, and the
Other 4,169,811.20
Investment Development Co. Ltd. December 2020 lease terminated in
September 2020
1 January 2018 - 31 Attached with renewal
Nanshan Group and its subsidiaries Other 3,198,846.84
December 2018 option
Buildings and 1 January 2019 -31 Attached with renewal
Nanshan Group and its subsidiaries 3,101,220.22
structures December 2019 option
China Merchants Commercial Property Buildings and 1 January 2018 - 31
2,632,960.86 N/A
Investment (Shenzhen) Co., Ltd. structures December 2020
1 May 2015 -30 April
Nanshan Group and its subsidiaries Other 2,619,047.62 N/A
2020
1 January 2020 - 31
Shenzhen Nanyou (Holdings) Co., Ltd. Other 1,995,553.20 N/A
December 2020
1 January 2016 - 31 Attached with renewal
Nanshan Group and its subsidiaries Other 1,817,704.08
December 2018 option
Buildings and 1 July 2019 - 31 Attached with renewal
Nanshan Group and its subsidiaries 1,468,461.12
structures December 2019 option
China Merchants Commercial Property Buildings and 1 January 2018 - 31
1,339,191.69 N/A
Investment (Shenzhen) Co., Ltd. structures December 2020
China Merchants International Cold Chain Port and terminal 1 May 2018 – 30 April
990,257.55 N/A
(Shenzhen) Company Limited facilities 2021
China Merchants Commercial Property Buildings and 1 January 2018 - 31 Attached with renewal
877,680.00
Investment (Shenzhen) Co., Ltd. structures December 2020. option
China Merchants International Cold Chain Buildings and 22 March 2020 -28
819,000.00 N/A
(Shenzhen) Company Limited structures February 2021
China Merchants International Cold Chain Buildings and 22 March 2019 -21
777,000.00 N/A
(Shenzhen) Company Limited structures March 2020
China Merchants Commercial Property Buildings and 1 September 2018 - 31
687,796.80 N/A
Investment (Shenzhen) Co., Ltd. structures December 2020
Buildings and 1 January 2019 - 31 Attached with renewal
Nanshan Group and its subsidiaries 639,738.84
structures December 2023 option
Shenzhen Qianhai Shekou Free Trade 10 February 2020 -31
Other 485,224.52 N/A
Investment Development Co. Ltd. May 2020
- 157 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(X) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions - continued
(2) Leases with related parties - continued
The Group as the lessee: - continued
Lease term (disclose the
Other significant lease
Name of the lessor Type of leased assets Rental (year) period covered by
terms
contract)
Buildings and 1 May 2019 - 31 Attached with renewal
Nanshan Group and its subsidiaries 352,656.00
structures December 2019 option
1 January 2017 -25
Nanshan Group and its subsidiaries Other 346,575.86 N/A
August 2021
China Yangtze Shipping Group Wuhan Buildings and 15 April 2019 -14 The contract has
310,196.16
Real Estate Co., Ltd. structures January 2021 terminated
1 January 2017 - 31 Attached with renewal
Nanshan Group and its subsidiaries Other 230,502.86
December 2020. option
1 January 2020 -31 The contract has
Shenzhen Nanyou (Holdings) Co., Ltd. Other 218,999.99
July 2020 terminated
China Merchants Commercial Property Buildings and 25 August 2018 - 31
218,326.32 N/A
Investment (Shenzhen) Co., Ltd. structures December 2020
Buildings and 1 May 2019 - 31 Attached with renewal
Nanshan Group and its subsidiaries 147,490.74
structures December 2019 option
China Merchants Apartment Development Buildings and 1 January 2020 - 31
133,680.00 N/A
(Shenzhen) Co., Ltd. structures December 2020
Shenzhen Wanhai Mansion Management Buildings and 15 June 2018 -14 June Progressively increasing
101,620.00
Co., Ltd. structures 2021 rent
China Merchants Landmark (Shenzhen) Buildings and 15 June 2018 -14 June Progressively increasing
101,620.00
Co., Ltd. structures 2021 rent
China Merchants Godown, Wharf & Motor vehicles and 1 January 2020 - 28
95,152.23 N/A
Transportation Co., Ltd. cargo ships February 2020
Port and terminal 1 January 2019 - 31 Attached with renewal
Nanshan Group and its subsidiaries 93,981.20
facilities December 2023 option
China Merchants Commercial Property Buildings and 25 August 2018 - 31
76,421.87 N/A
Investment (Shenzhen) Co., Ltd. structures December 2020
China Merchants-Logistics Shenzhen Co., Buildings and 1 June 2019 – 30 April
41,360.00 N/A
Ltd. structures 2020
Buildings and 1 January 2015 -31 Attached with renewal
Nanshan Group and its subsidiaries 22,080.00
structures December 2015 option
Total 374,365,478.53
(3) Related party guarantees
The Group as the guarantor
The guarantee has
Secured party Credit Line Guaranteed amount Commencement date Maturity
been completed or not
2020
Terminal Link SAS (Note 1) 71,003,968.05 71,003,968.05 1 June 2013 2033 No
Khor Ambado FZCo (Note 2) 187,917,834.24 113,125,755.69 24 May 2019 2032 No
Total 258,921,802.29 184,129,723.74
2019
Terminal Link SAS (Note 1) 24,982,114.97 12,241,236.33 1 June 2013 2019 Yes
Terminal Link SAS (Note 1) 80,305,197.15 80,305,197.15 1 June 2013 2033 No
Khor Ambado FZCo (Note 2) 200,914,560.00 118,398,397.00 24 May 2019 2032 No
Port de Djibouti S.A. 343,160,000.00 24,192,780.00 14 June 2016 14 June 2019 Yes
Total 649,361,872.12 235,137,610.48
- 158 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(X) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions - continued
(3) Related party guarantees - continued
The Group as the guarantor - continued
Note 1: CMA CGM S.A. is another shareholder of Terminal Link SAS, an associate of the Group. The Group has
made a commitment to CMA CGM S.A. that the Group will provides guarantee for its bank loan financing
to the associate Terminal Link SAS and other liabilities to the extent of the Group's 49% ownership
interest in the company. The actual guaranteed amount is RMB71,003,968.05 on 31 December 2020. If
any guarantee liability occurs, the Group will compensate CMA CGM S.A.
Note 2: Khor Ambado FZCo is a related company of the Group's common ultimate controlling shareholder. The
Group provides guarantee for its bank loans and other liabilities, the actual amount of which as at 31
December 2020 is RMB 113,125,755.69.
(4) Borrowings and loans with related parties
Commencement
Related party Amount Maturity date Description
date
2020
Borrowings
China Merchants Group Finance Company Limited 1,301,430,000.00 22 October 2020 21 October 2021 Fixed annual interest rate of 3.6000%
China Merchants Group Finance Company Limited 672,821,155.13 28 December 2020 27 January 2021 Fixed annual interest rate of 3.4500%
China Merchants Finance Lease (Tianjin) Co., Ltd. 200,235,277.84 14 April 2020 13 April 2024 Fixed annual interest rate of 4.0500%
China Merchants Group Finance Company Limited 200,235,277.78 25 September 2020 24 September 2021 Fixed annual interest rate of 3.8500%
China Merchants Group Finance Company Limited 192,039,573.34 30 December 2020 29 December 2021 Fixed annual interest rate of 3.7100%
China Merchants Group Finance Company Limited 76,929,960.60 25 March 2020 12 March 2029 Fixed annual interest rate of 4.5050%
China Merchants Group Finance Company Limited 70,086,890.22 22 June 2020 21 June 2024 Fixed annual interest rate of 1.2000%
China Merchants Group Finance Company Limited 50,606,027.37 5 June 2020 2 March 2021 Fixed annual interest rate of 1.9900%
China Merchants Group Finance Company Limited 50,056,680.56 21 May 2020 20 May 2021 Fixed annual interest rate of 3.7100%
China Merchants Group Finance Company Limited 40,000,000.00 20 December 2020 31 October 2023 Fixed annual interest rate of 1.2000%
China Merchants Group Finance Company Limited 47,000,000.00 6 January 2020 7 October 2024 Fixed annual interest rate of 4.5125%
China Merchants Group Finance Company Limited 30,035,291.66 4 December 2020 20 May 2021 Fixed annual interest rate of 3.7100%
China Merchants Group Finance Company Limited 10,000,000.00 3 November 2020 12 May 2021 Fixed annual interest rate of 2.5000%
China Merchants Group Finance Company Limited 1,500,000.00 17 December 2020 10 December 2028 Fixed annual interest rate of 4.4100%
Total 2,942,976,134.50
Lendings
Terminal Link SAS 2,975,444,121.38 26 March 2020 26 March 2028 Fixed annual interest rate of 6.0000%
Port of Newcastle and its subsidiaries 815,144,304.00 30 May 2020 23 July 2023 Fixed annual interest rate of 8.0000%
Tianjin Haitian Bonded Logistics Co., Ltd. 34,300,000.00 3 January 2020 2 January 2023 Fixed annual interest rate of 4.7500%
Total 3,824,888,425.38
2019
Borrowings
China Merchants Group Finance Company Limited 300,378,812.51 2 December 2019 1 December 2020 Fixed annual interest rate of 4.1325%
China Merchants Group Finance Company Limited 270,548,281.28 22 April 2019 21 April 2020 Fixed annual interest rate of 4.3500%
China Merchants Financial Leasing (Tianjin) Co., Ltd. 150,000,000.00 23 December 2019 23 December 2025 Fixed annual interest rate of 4.7500%
China Merchants Group Finance Company Limited 150,000,000.00 27 August 2019 26 August 2020 Fixed annual interest rate of 4.1325%
China Merchants Group Finance Company Limited 56,483,984.71 1 July 2019 1 July 2034 Fixed annual interest rate of 4.6550%
China Merchants Group Finance Company Limited 50,061,625.00 4 June 2019 3 June 2020 Fixed annual interest rate of 4.3500%
China Merchants Group Finance Company Limited 50,000,000.00 29 July 2019 28 July 2022 Fixed annual interest rate of 4.5125%
China Merchants Group Finance Company Limited 47,000,000.00 14 October 2019 13 October 2024 Fixed annual interest rate of 4.7500%
China Merchants Group Finance Company Limited 33,052,804.00 22 July 2019 21 July 2020 Fixed annual interest rate of 4.3500%
China Merchants Group Finance Company Limited 29,000,000.00 18 October 2019 17 October 2023 Fixed annual interest rate of 4.7500%
China Merchants Group Finance Company Limited 28,000,000.00 15 January 2019 14 January 2024 Fixed annual interest rate of 4.7500%
China Merchants Group Finance Company Limited 23,000,000.00 10 June 2019 14 January 2024 Fixed annual interest rate of 4.7500%
China Merchants Group Finance Company Limited 10,000,000.00 28 December 2019 31 October 2023 Fixed annual interest rate of 1.2000%
China Merchants Group Finance Company Limited 6,000,000.00 22 July 2019 21 July 2020 Fixed annual interest rate of 4.3500%
China Merchants Group Finance Company Limited 1,000,000.00 24 December 2019 23 December 2020 Fixed annual interest rate of 4.3500%
Total 1,204,525,507.50
Lendings
China Merchants Antong Logistics Management
50,000,000.00 24 September 2019 24 September 2021 Fixed interest rate of 8.5000%
Company
- 159 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(X) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions - continued
(5) Asset transfer from related parties
Pricing method and Amount Amount
Content of decision procedures accumulated accumulated
Related party
transaction of related in the current in the prior
transactions period period
Hoi Tung (Shanghai) Company Limited Machinery equipment Negotiation 8,202,477.87 5,891,378.30
Hoi Tung Innotek (Shenzhen) Co., Ltd. Machinery equipment Negotiation 1,946,000.00 738,053.10
China Merchants Property Management Ordinary office
Negotiation - 710,229.95
(Shenzhen) Co., Ltd. equipment
Khor Ambado FZCo Intangible assets Negotiation - 190,885,258.20
Ordinary office
Other related parties Negotiation 83,584.00 330,810.79
equipment
Total 10,232,061.87 198,555,730.34
(6) Compensation for key management personnel
Amount incurred Amount incurred
Item in the current in the prior
period period
Compensation for key management personnel 20,552,276.50 26,856,013.14
6. Amounts due from/to related parties
(1) Amounts due from related parties
Item Related party Closing balance Opening balance
China Merchant Bank Co., Ltd. 1,899,970,131.14 1,451,996,464.50
Cash and bank balances China Merchants Group Finance Company Limited 1,568,924,175.58 890,065,186.36
Total 3,468,894,306.72 2,342,061,650.86
Held-for-trading financial
China Merchant Bank Co., Ltd. 850,000,000.00 -
assets
China COSCO Shipping Group and its subsidiaries 120,615,548.37 60,545,437.55
Antong Holdings Co., Ltd. and its subordinate companies 10,508,254.42 60,112,564.13
China Marine Shipping Agency Guangdong Co., Ltd. 7,777,640.18 3,583,505.77
China Marine Shipping Agency Ningbo Co., Ltd. 7,773,568.86 -
COSCO Logistics (Zhanjiang) Co., Ltd. 4,326,223.02 7,728,194.66
Guizhou East Land Port Operation Co., Ltd. 3,612,221.02 4,043,600.57
Khor Ambado FZCo 2,774,015.84 3,113,788.09
Shenzhen Baohong E-Commerce Integrated Services Co.,
2,641,391.12 4,643,545.31
Ltd.
Qingdao Qianwan West Port United Wharf Co., Ltd. 2,007,669.18 2,986,271.27
Port de Djibouti S.A. 1,497,611.83 1,689,447.85
Great Horn Development Company FZCo 1,427,020.52 2,771,510.50
Accounts receivable
Sinotrans Container Lines Co., Ltd. 1,148,569.75 1,746,120.89
Guizhou Qiandongnan Continental Land Port Operation
1,061,604.20 2,010,137.38
Co., Ltd.
South China Sinotrans Supply Chain Management Co.,
1,035,675.13 1,808,219.75
Ltd.
China Ocean Shipping Agency Shenzhen 843,054.75 5,609,630.60
China Marine Shipping Agency Shenzhen Co., Ltd. 322,016.25 1,058,089.50
Yantai Port Group Laizhou Port Co., Ltd. - 1,853,183.12
Zhanjiang CMHK Investment Co., Ltd. - 1,536,503.45
Qingdao Qianwan United Container Terminal Co., Ltd. - 4,424,422.68
Other related parties 8,041,402.85 5,130,480.00
Total 177,413,487.29 176,394,653.07
- 160 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(X) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
6. Amounts due from/to related parties - continued
(1) Amounts due from related parties - continued
Item Related party Closing balance Opening balance
Nanshan Group and its subsidiaries 210,831,000.00 313,724,861.31
Chu Kong River Trade Terminal Co., Ltd. 57,607,520.00 61,317,510.00
Tin-Can Island Container Terminal Ltd 33,289,037.77 82,625,546.31
Zhanjiang Infrastructure Construction Investment Group
31,513,558.59 31,513,558.59
Co., Ltd.
Port de Djibouti S.A. 23,248,597.69 24,832,398.83
COSCO Logistics (Zhanjiang) Co., Ltd. 13,378,666.52 13,751,368.26
Zhoushan Blue Ocean Investment Co., Ltd. 4,996,989.39 -
Shenzhen Qianhai Shekou Free Trade Investment
4,000,000.00 -
Development Co. Ltd.
Other receivables
China Merchants Shenzhen Ro-Ro Shipping Co., Ltd. 2,899,163.95 2,899,163.95
China Merchants (Liaoning) Port Development Co., Ltd. 2,000,000.00 -
EuroAsia Dockyard Enterprise and Development Limited 1,422,660.84 1,514,281.82
China Merchants Commercial Property Investment
1,068,658.39 1,068,658.39
(Shenzhen) Co., Ltd.
Sinotrans Guangdong Co., Ltd. - 3,803,477.07
Tianjin Haitian Bonded Logistics Co., Ltd. 220,500.00 33,282,119.52
Qingdao Qianwan United Container Terminal Co., Ltd. - 50,000,000.00
Other related parties 3,961,060.53 4,199,662.93
Total 390,437,413.67 624,532,606.98
Prepayments Other related parties 244,729.25 1,414,261.04
Other current assets China Merchant Bank Co., Ltd. - 1,528,851,492.46
Terminal Link SAS 51,286,674.10 -
Non-current assets due
Port of Newcastle and its subsidiaries 16,473,559.57 809,702,715.78
within one year
Total 67,760,233.67 809,702,715.78
Terminal Link SAS 2,746,067,386.31 9,800,295.76
Port of Newcastle and its subsidiaries 815,144,304.00 -
Zhanjiang CMHK Investment Co., Ltd. 286,330,144.62 1,025,631,435.87
China Merchants Finance Lease (Tianjin) Co., Ltd. 10,000,000.00 14,500,000.00
Long-term receivables
China Merchants Antong Logistics Management
- 50,000,000.00
Company
Tianjin Haitian Bonded Logistics Co., Ltd. 34,300,000.00 -
Total 3,891,841,834.93 1,099,931,731.63
(2) Amounts due to related parties
Item Related party Closing balance Opening balance
China Merchants Group Finance Company Limited 2,646,853,256.33 841,079,404.24
Short-term borrowings China Merchant Bank Co., Ltd. - 70,093,041.67
Total 2,646,853,256.33 911,172,445.91
Other current liabilities China Merchants Group Finance Company Limited 60,606,027.37 -
Nanshan Group and its subsidiaries 9,220,434.36 10,747,794.44
Qingdao Qianwan West Port United Wharf Co., Ltd. 6,381,033.57 7,641,839.79
EuroAsia Dockyard Enterprise and Development Limited 2,994,548.16 2,974,168.52
Yiu Lian Dockyards Limited 2,271,520.48 1,676,082.11
Accounts payable
China Marine Shipping Agency Shenzhen Co., Ltd. 1,264,544.50 535,279.71
China Merchants Logistics Group Qingdao Co., Ltd. 21,834.03 1,006,844.56
Other related parties 558,566.85 3,078,887.88
Total 22,712,481.95 27,660,897.01
Port de Djibouti S.A. 10,350,122.63 -
Receipts in advance Other related parties 606,631.45 600,535.85
Total 10,956,754.08 600,535.85
Antong Holdings Co., Ltd. and its subordinate companies 6,774,086.39 521,882.13
China Marine Shipping Agency Guangdong Co., Ltd. 2,304,015.01 3,577,148.00
Contract liabilities
Other related parties 3,264,592.40 1,932,142.96
Total 12,342,693.80 6,031,173.09
- 161 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(X) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
6. Amounts due from/to related parties - continued
(2) Amounts due to related parties - continued
Item Related party Closing balance Opening balance
Port de Djibouti S.A. 175,497,252.70 -
Terminal Link SAS 89,905,681.62 88,978,919.98
Sri Lanka Ports Authority 34,255,854.79 31,392,997.47
China Merchants Port Investment Development Company
26,418,918.90 -
Limited
China Merchants Zhangzhou Development Zone Co.,
20,000,000.00 -
Ltd.
China Merchants Real Estate (Shenzhen) Co., Ltd. 14,305,122.78 20,762,053.30
China Merchants Commercial Property Investment
8,447,512.23 8,947,256.82
(Shenzhen) Co., Ltd.
China Merchants Investment and Development Co., Ltd. 2,910,544.27 -
Shenzhen Baohong E-Commerce Integrated Services Co.,
2,634,014.09 199,894.69
Ltd.
Zhanjiang Xiagang United Development Co., Ltd. 1,433,730.78 1,433,990.57
Other payables China Merchant Food (China) Co., Ltd. 1,161,179.14 1,264,171.10
Penavico Shenzhen Warehousing Co., Ltd. 1,127,339.68 554,335.48
Sinotrans Shenzhen Qianhai Supply Chain Management
1,013,738.40 492,259.78
Ltd.
China Merchants Property Management (Shenzhen) Co.,
223,640.00 9,264,823.90
Ltd.
COSCO Logistics (Zhanjiang) Co., Ltd. 101,708.65 1,258,811.65
China Merchants Shekou Industrial Zone Holdings Co.,
10,000.00 11,305,700.00
Ltd.
Modern Terminals Limited - 59,038,373.05
China Merchants Finance Lease (Tianjin) Co., Ltd. - 11,250,000.00
Yihai Kerry Golden Arowana Cereals, Oils and
- 37,402,426.09
Foodstuffs Co., Ltd.
Other related parties 6,457,095.12 28,926,796.51
Total 385,903,333.15 312,472,810.39
China Merchants Finance Lease (Tianjin) Co., Ltd. 138,409,402.75 145,861,850.10
China Merchants Tongshang Finance Lease Co., Ltd. 58,348,704.99 56,146,040.22
Nanshan Group and its subsidiaries 54,030,933.00 52,656,827.70
EuroAsia Dockyard Enterprise and Development Limited 13,406,128.42 14,269,498.38
China Merchants Shekou Industrial Zone Holdings Co.,
39,512,425.01 5,454,253.54
Ltd.
Non-current liabilities due China Merchants Commercial Property Investment
- 5,579,040.25
within one year (Shenzhen) Co., Ltd.
China Merchants Landmark (Shenzhen) Co., Ltd. - 1,242,022.25
Shenzhen Science and Technology University Phase II
3,263,992.11
Real Estate Management Co., Ltd.
China Merchants Group Finance Company Limited 51,423,306.47 -
Other related parties 348,523.44 1,770,041.27
Total 355,479,424.08 286,243,565.82
Other non-current liabilities Nanshan Group and its subsidiaries 944,011.06 1,564,380.59
China Merchants Group Finance Company Limited 426,100,835.53 376,483,984.71
Long-term borrowings China Merchant Bank Co., Ltd. 109,033,232.39 20,000,000.00
Total 535,134,067.92 396,483,984.71
Long-term payables China Merchants Finance Lease (Tianjin) Co., Ltd. - 144,000,000.00
Total - 144,000,000.00
China Merchants Finance Lease (Tianjin) Co., Ltd. 358,333,616.46 491,666,949.79
Nanshan Group and its subsidiaries 114,304,842.23 167,685,128.23
China Merchants Tongshang Finance Lease Co., Ltd. 104,616,135.92 161,829,816.02
Lease liabilities China Merchants Shekou Industrial Zone Holdings Co.,
- 5,691,513.57
Ltd.
Other related parties - 1,880,637.25
Total 577,254,594.61 828,754,044.86
- 162 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(XI) SHARE-BASED PAYMENTS
1. Overall share-based payments
Total equity instruments granted by the Company in the year 17,198,000
Total equity instruments exercised by the Company in the year None
Total equity instruments of the Company that became invalid in the year None
The range of the exercise price of the stock options externally issued by
Exercise price: RMB17.80;
the Company at the end of the year and the remaining term of the
The remaining term of the contract: 73 months
contract
The range of the exercise price of the other equity instruments externally
issued by the Company at the end of the year and the remaining term of None
the contract
2. Share-based payments settled by equity
The method used to determine the fair value of equity instruments on the The cost of granted stock options was estimated
day of granting using the Black Scholes Model.
On each balance sheet date in the waiting period,
the best estimate was made and the estimated
number of exercisable equity instruments was
The basis for determining the number of exercisable equity instruments
modified according to the latest changes in the
number of employees who can exercise the rights
and other subsequent information.
Reasons for the significant difference between the estimates of this year
N/A
and the estimates of last year
The aggregate amount of share-based payments settled by equity that is
10,096,607.62
included in the capital reserve
Total expenses recognized for the share-based payments settled by equity
19,213,391.58
in the year
Pursuant to the Official Reply on the Implementation of the Stock Option Incentive Plan of China Merchants Port
Group Co., Ltd. by State-owned Assets Supervision and Administration Commission of the State Council, (No. 748
[2019], SASAC), and which was deliberated and approved by the 1st Extraordinary General Meeting of the Company
in 2020 on 3 February 2020, the Company implemented a stock option plan with effect from 3 February 2020 to grant
238 incentive recipients 17,198,000 stock options with an exercise price of RMB17.80 per share; subject to the
fulfilment of the exercise conditions,40% of the stock options will be exercisable two years after the grant date,30%
will be exercisable three years after the grant date and 30% will be exercisable four years after the grant date, and can
be exercised to subscribe for shares of the Company within one year, one year and three years from the exercise date,
respectively; each stock option entitles the holder to subscribe for one common share of the Company.
- 163 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(XII) COMMITMENTS AND CONTINGENCIES
1. Significant commitments
Item 31/12/2020 31/12/2019
Commitments that have been entered into but have not
been recognized in the financial statements
- Commitment to make contributions to the investees 11,500,000.00 -
- Commitment to acquire and construct long-term assets 2,682,977,514.73 3,767,236,258.74
- Commitment to invest port construction 1,004,960,692.18 6,758,563,544.21
- Others 20,831,652.14 354,959,845.19
Total 3,720,269,859.05 10,880,759,648.14
2. Contingencies
Item 31/12/2020 31/12/2019
Contingent liabilities brought by external litigations
213,109,668.45 274,299,826.26
(Note 1)
Guarantee for borrowings of related parties (Note 2) 184,129,723.74 198,703,594.15
Total 397,239,392.19 473,003,420.41
Note 1: This represents the significant contingent liabilities arising from the litigations between TCP and its
subsidiaries and local tax authority, employee or former employee of TCP and its subsidiaries in Brazil at
as the year end. According to the latest estimates of the Group's management, the possible compensation is
RMB213,109,668.45 but it is not likely to cause outflow of economic benefits from the Group. Therefore,
the contingent liabilities arising from the above pending litigations are not recognized as provisions. The
counter-bonification where the Group as the beneficiary will be executed by the former TCP shareholder
that disposed the shares. According to the counter-bonification agreement, the former TCP shareholder
need to make counter-bonification to the Group in respect of the above contingent liabilities, with the
compensation amount not exceeding pre-determined amount and specified period.
Note 2: Till December 31, 2020, the guarantees provided by the Group for related parties are detailed in Note X,
5(3).
On December 31, 2020, the directors of the Group evaluated the default risks of related companies on the
above-mentioned loan financing and other liabilities, and believed that the risks were not significant and
the possibility of guaranteed payments was very small.
Except for the above-mentioned contingencies, as of December 31, 2020, the Group had no other major
guarantees and other contingencies that need to be explained.
- 164 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(XIII) EVENTS AFTER THE BALANCE SHEET
1. Coronavirus Disease 2019
Since the outbreak of coronavirus disease 2019 ("COVID-19") in China in January 2020, the control and prevention
of COVID-19have been carried out throughout the country. The Group actively responded and implemented the
regulations and requirements on COVID-19of the government.
It is expected that COVID-19 and control measures will still have temporary influence on the Group's production and
management in 2021. However, the impact of COVID-19 on economy depends on the progress, effectiveness and
duration of our pandemic prevention and control work.
The Group continues to pay close attention to the development of COVID-19, assesses the impact on the financial
position and operating results of the Group. The Group will strengthen the prevention and control of the pandemic
and carry out normal business operations proactively and orderly.
2. Capital increase for International Information Technology Company
On 18 December 2020, the Company and China Merchants Port Holdings, a subsidiary of the Company, China
Merchants Holdings (International) Information Technology Company Limited ("CMHIT"), a subsidiary of the
Company, Dalian Port Jifa Logistics Co., Ltd. ("Jifa Logistics"), Dalian Port Container Development Co., Ltd.
("Dalian Port Container") and Yingkou Port Group Corporation (hereinafter referred to as "Yingkou Port Group")
entered into the "Agreement on Equity Subscription and Capital Increase" for CMHIT.
According to the "Agreement on Equity Subscription and Capital Increase", Jifa Logistics and Dalian Port Container
respectively used their shares in Dalian Port Logistics Network Co., Ltd. (hereinafter referred to as "DPN"), making
up 29.40% and 49.63%, and Yingkou Port Group used 100% shares of Yingkou Gangxin Technology Co., Ltd.
(hereinafter referred to as "Gangxin Technology") in its possession to increase the capital of CMHIT. Before and
after the combination, CMHIT, DPN, and Gangxin Technology were all under the ultimate control of the Company's
ultimate controlling shareholder China Merchants Group and such control was not temporary.
The aforesaid capital increase has been completed on 9 February 2021. After the increase, the Company, China
Merchants Port Holdings, Jifa Logistics, Dalian Port Container, and Yingkou Port Group respective held 13.18%,
43.74%, 13.26%, 22.38% and 7.44% of the shares of CMHIT. CMHIT is still a holding subsidiary of the Company.
- 165 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(XIII) EVENTS AFTER THE BALANCE SHEET - continued
3. Liaoning Port Co., Ltd.'s merger of Yingkou Port Liability Co., Ltd. by
absorption
On 6 January 2021, the merger of Yingkou Port Liability Co., Ltd. by the Company's associate Liaoning Port Co., Ltd.
by absorption was approved by the CSRC in the Reply on Approving the Merger of Yingkou Port Liability Co., Ltd.
by Liaoning Port Co., Ltd. by absorption and the Supporting Fund Raising (No. 3690 [2020], CSRC). On 29 January
2021, Shanghai Securities Exchange terminated the listing of the shares of Yingkou Port Liability Co., Ltd. and the
new A shares of Liaoning Port Co., Ltd. issued to the previous shareholders of Yingkou Port Liability Co., Ltd. were
listed for circulation on 9 February 2021. After the completion of the aforesaid transaction, the shareholding of the
Group in Liaoning Port Co., Ltd. is diluted from 21.05% to 12.00%, but Liaoning Port Co., Ltd. is still an associate of
the Group, while the Group can designate 2 candidates out of the 9 members of the board of directors of Liaoning
Port Co., Ltd.
(XIV) OTHER SIGNIFICANT EVENTS
1. Segment reporting
(1) Basis for determining reporting segments and accounting policies
The key management team of the Company is regarded as the CODM, who reviews the Group's internal reports in
order to assess performance, allocate resources and determine the operating segments.
The CODM manages the Group's operations by divisions from both business and geographic perspectives.
In respect of business segments, management assesses the performance of the Group's business operations including
ports operation, bonded logistics operation and other operations.
Ports operation
Ports operation includes container terminal operation, bulk and general cargo terminal operation operated by the
Group and its associates and joint ventures. The Group's reportable segments of the ports operation are as follows:
(a) Mainland China, Hong Kong and Taiwan
Pearl River Delta
Yangtze River Delta
Bohai Rim
Others
(b) Other locations outside of Mainland China, Hong Kong and Taiwan
- 166 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(XIV) OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(1) Basis for determining reporting segments and accounting policies - continued
Bonded logistics operation
Bonded logistics operation includes logistics park operation, ports transportation and airport cargo handling operated
by the Group and its associates and joint ventures.
Other operations
Other operations mainly include property development and investment and construction of modular housing operated
by the Group's associates, property investment operated by the Group and corporate function.
Each of the segments under ports operation include the operations of a number of ports in various locations within
one geographic location, each of which is considered as a separate operating segment by the CODM. For the
purpose of segment reporting, these individual operating segments have been aggregated into reportable segments on
geographic basis in order to present a more systematic and structured segment information. To give details of each
of the operating segments, in the opinion of the directors of the Company, would result in particulars of excessive
length.
Bonded logistics operation and other operations include a number of different operations, each of which is considered
as a separate but insignificant operating segment by the CODM. For segment reporting, these individual operating
segments have been aggregated according to the natures of their operations to give rise to more meaningful
presentation.
There are no material sales or other transactions between the segments.
As at 31 December 2020, around 73% of the Group's non-current assets other than financial instruments and deferred
tax assets are located in Chinese Mainland.
- 167 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(XIV) OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(2) Segment financial information
Segment financial information for 2020 is as follows:
Ports operation
Mainland China, Hong Kong and Taiwan Bonded logistics Unallocated
Item Others Total
Pearl River Yangtze River Other locations Sub-total operation amount
Bohai Rim Others
Delta Delta
Operating income 5,103,018,820.66 73,413,401.10 62,661,236.23 3,333,716,950.72 3,474,914,093.88 12,047,724,502.59 417,391,441.86 153,414,051.57 - 12,618,529,996.02
Operating cost 2,868,604,331.58 40,965,225.12 48,645,796.45 2,681,846,267.01 1,767,068,217.21 7,407,129,837.37 245,350,697.54 221,269,319.94 - 7,873,749,854.85
Segment operating profit
2,234,414,489.08 32,448,175.98 14,015,439.78 651,870,683.71 1,707,845,876.67 4,640,594,665.22 172,040,744.32 -67,855,268.37 - 4,744,780,141.17
(loss is marked with "-")
Adjustments:
Taxes and surcharges 26,848,292.01 1,525,681.36 1,155,694.87 48,249,699.24 34,531,713.98 112,311,081.46 20,652,317.30 18,092,487.86 141,056.95 151,196,943.57
Administrative expense 480,217,540.48 14,189,057.25 9,379,082.71 473,751,196.10 249,846,408.69 1,227,383,285.23 42,007,434.87 1,093,821.55 314,398,393.37 1,584,882,935.02
R&D expenses 134,862,028.30 3,968,928.76 - 15,724,656.48 - 154,555,613.54 - - 1,468,500.00 156,024,113.54
Financial expenses 144,531,069.38 -14,347,282.70 -9,466,114.16 133,937,742.90 44,368,823.84 299,024,239.26 16,272,850.96 19,152,258.84 898,280,275.76 1,232,729,624.82
Other income 68,057,789.94 1,752,751.59 33,397.31 51,406,035.35 - 121,249,974.19 10,173,062.64 73,365,149.56 176,926.89 204,965,113.28
Investment income 206,990,240.85 3,122,680,492.45 351,638,093.79 103,533,080.19 357,882,216.11 4,142,724,123.39 19,641,031.91 743,610,282.92 - 4,905,975,438.22
Gains from changes in
fair value (loss is marked 33,063,464.71 150,747,337.90 77,018,544.18 8,043,866.90 -680,381,987.27 -411,508,773.58 - - - -411,508,773.58
with "-")
Impairment gains of
credit (loss is marked -6,981,966.51 1,020,000.00 - 28,130,653.65 -477,897,709.00 -455,729,021.86 -2,866,639.45 - - -458,595,661.31
with "-")
Impairment gains of
assets (loss is marked 947,694.12 - - -552,317,736.65 - -551,370,042.53 - - - -551,370,042.53
with "-")
Gains from disposal of
assets (loss is marked 5,187,792.01 507,040.19 -1,441.50 1,600,635,718.61 311,438.49 1,606,640,547.80 305,861.36 -117,707,200.00 -32,706.84 1,489,206,502.32
with "-")
Operating profit (loss is
1,755,220,574.03 3,303,819,413.44 441,635,370.14 1,219,639,007.04 579,012,888.49 7,299,327,253.14 120,361,457.65 593,074,395.86 -1,214,144,006.03 6,798,619,100.62
marked with "-")
- 168 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(XIV) OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(2) Segment financial information - continued
Segment financial information for 2020 is as follows: - continued
Ports operation
Mainland China, Hong Kong and Taiwan Bonded logistics Unallocated
Item Others Total
Pearl River Yangtze River Other locations Sub-total operation amount
Bohai Rim Others
Delta Delta
Non-operating income 43,255,084.67 43,196.21 440,831.36 31,641,529.53 1,889,443.67 77,270,085.44 198,116.16 1,391,661.99 2,779,196.95 81,639,060.54
Non-operating expenses 2,960,035.34 813,550.98 25,948.75 22,767,505.78 25,707,516.11 52,274,556.96 42,000.00 - 26,687,183.81 79,003,740.77
Gross profit (loss is
1,795,515,623.36 3,303,049,058.67 442,050,252.75 1,228,513,030.79 555,194,816.05 7,324,322,781.62 120,517,573.81 594,466,057.85 -1,238,051,992.89 6,801,254,420.39
marked with "-")
Income tax expenses 601,626,798.98 169,174,798.29 62,114,619.13 493,406,817.80 -52,337,554.93 1,273,985,479.27 15,094,962.21 15,750,266.73 -29,144,338.38 1,275,686,369.83
Net profit (loss is marked
1,193,888,824.38 3,133,874,260.38 379,935,633.62 735,106,212.99 607,532,370.98 6,050,337,302.35 105,422,611.60 578,715,791.12 -1,208,907,654.51 5,525,568,050.56
with "-")
Segment assets 29,429,571,613.29 31,908,794,260.42 7,246,173,514.37 28,817,067,046.45 44,448,666,487.24 141,850,272,921.77 3,315,494,460.32 18,756,757,172.64 4,621,087,222.48 168,543,611,777.21
Total assets in the financial statements 168,543,611,777.21
Segment liabilities 14,603,582,775.85 1,603,641,824.41 143,181,803.40 8,354,597,807.60 9,659,518,990.29 34,364,523,201.55 583,644,968.76 1,372,383,302.75 26,546,092,773.08 62,866,644,246.14
Total liabilities in the financial statements 62,866,644,246.14
Supplementary
information:
Depreciation and
868,406,726.45 16,840,576.77 2,019,814.39 986,324,667.31 843,174,817.50 2,716,766,602.42 97,449,874.10 175,099,107.40 22,567,185.84 3,011,882,769.76
Amortization
Interest income 40,043,816.95 2,611,662.90 2,863,089.15 61,729,133.61 203,403,087.34 310,650,789.95 1,372,300.78 1,105,725.59 12,258,928.24 325,387,744.56
Interest expense 205,070,654.67 2,716,578.54 - 194,085,313.44 312,694,424.90 714,566,971.55 20,355,642.89 34,988,377.32 1,179,971,384.93 1,949,882,376.69
Investment income from
long-term equity
136,557,365.02 2,329,321,018.47 321,168,422.22 80,736,626.43 357,882,216.11 3,225,665,648.25 19,641,031.91 743,610,282.92 - 3,988,916,963.08
investment under equity
method
Long-term equity
investment under equity 4,141,735,655.77 28,460,075,468.21 6,275,998,231.07 604,585,694.21 13,303,915,012.11 52,786,310,061.37 736,196,163.40 12,709,417,198.68 - 66,231,923,423.45
method
Non-current assets other
than long-term equity 21,716,318,098.15 4,256,897,677.23 24,886,574.80 19,427,332,228.33 24,705,573,985.43 70,131,008,563.94 2,226,903,590.34 5,238,035,244.36 422,618,810.40 78,018,566,209.04
investment
- 169 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(XIV) OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(2) Segment financial information - continued
Segment financial information for 2019 is as follows:
Ports operation
Bonded
Mainland China, Hong Kong and Taiwan
Item logistics Others Unallocated amount Total
Pearl River Yangtze River Other locations Sub-total
Bohai Rim Others operation
Delta Delta
Operating income 5,196,613,368.06 - 65,287,182.79 3,048,109,069.32 3,237,062,565.69 11,547,072,185.86 411,410,069.19 165,347,168.69 - 12,123,829,423.74
Operating cost 3,008,092,503.04 - 54,620,318.87 2,442,406,257.78 1,680,548,644.03 7,185,667,723.72 240,230,706.61 223,022,489.38 - 7,648,920,919.71
Segment operating profit
2,188,520,865.02 - 10,666,863.92 605,702,811.54 1,556,513,921.66 4,361,404,462.14 171,179,362.58 -57,675,320.69 - 4,474,908,504.03
(loss is marked with "-")
Adjustments:
Taxes and surcharges 28,208,048.74 902,080.83 1,226,820.81 41,913,977.40 74,183,581.47 146,434,509.25 10,405,578.38 15,266,911.26 449,581.03 172,556,579.92
Administrative expense 367,421,172.07 14,629,856.34 11,286,215.13 427,071,045.26 240,768,795.97 1,061,177,084.77 40,794,239.92 1,086,063.41 406,463,193.56 1,509,520,581.66
R&D expenses 119,506,939.75 - - 4,346,404.54 - 123,853,344.29 - - - 123,853,344.29
Financial expenses 186,473,966.41 3,557,959.06 -1,031,714.93 140,511,147.67 343,853,815.52 673,365,173.73 27,521,546.75 43,602,750.59 1,191,780,266.46 1,936,269,737.53
Other income 74,072,845.73 1,224,999.96 136,812.67 53,835,650.36 - 129,270,308.72 22,545,823.25 6,361.40 10,278,619.73 162,101,113.10
Investment income 160,825,470.54 2,569,882,989.42 415,798,097.77 772,742,553.30 439,240,848.69 4,358,489,959.72 23,454,651.74 237,229,143.96 - 4,619,173,755.42
Gains from changes in
fair value (loss is marked 10,933.07 154,574,350.85 297,972,325.74 -21,212,710.87 -364,861,632.31 66,483,266.48 - - - 66,483,266.48
with "-")
Impairment gains of
credit (loss is marked -2,704,122.79 - 96,054.01 -47,117,070.21 -510,363.77 -50,235,502.76 -13,907.01 - - -50,249,409.77
with "-")
Impairment gains of
assets (loss is marked 25,051.16 - - - - 25,051.16 - - - 25,051.16
with "-")
Gains from disposal of
assets (loss is marked 4,172,962,308.96 - 13,069.99 620,155,605.55 764,083.94 4,793,895,068.44 -3,047.02 - 670,761.37 4,794,562,782.79
with "-")
Operating profit (loss is
5,892,103,224.72 2,706,592,444.00 713,201,903.09 1,370,264,264.80 972,340,665.25 11,654,502,501.86 138,441,518.49 119,604,459.41 -1,587,743,659.95 10,324,804,819.81
marked with "-")
- 170 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(XIV) OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(2) Segment financial information - continued
Segment financial information for 2019 is as follows: - continued
Ports operation
Bonded
Mainland China, Hong Kong and Taiwan Unallocated
Item logistics Others Total
Pearl River Yangtze River Other locations Sub-total amount
Bohai Rim Others operation
Delta Delta
Non-operating income 15,167,367.31 - 920,329.94 19,125,548.43 512,078,201.39 547,291,447.07 458,318.63 1,086,658.83 4,266,935.88 553,103,360.41
Non-operating expenses 13,328,509.27 4,069.14 8,922.44 25,023,662.84 14,345,696.95 52,710,860.64 57,151.76 50,000.00 17,634,000.00 70,452,012.40
Gross profit (loss is
5,893,942,082.76 2,706,588,374.86 714,113,310.59 1,364,366,150.39 1,470,073,169.69 12,149,083,088.29 138,842,685.36 120,641,118.24 -1,601,110,724.07 10,807,456,167.82
marked with "-")
Income tax expenses 1,922,260,744.88 134,247,591.99 91,985,992.66 224,620,829.53 92,650,917.92 2,465,766,076.98 31,835,647.68 13,078,333.18 129,858,836.78 2,640,538,894.62
Net profit (loss is marked
3,971,681,337.88 2,572,340,782.87 622,127,317.93 1,139,745,320.86 1,377,422,251.77 9,683,317,011.31 107,007,037.68 107,562,785.06 -1,730,969,560.85 8,166,917,273.20
with "-")
Segment assets 29,586,087,542.86 26,729,937,567.14 7,140,466,913.27 26,167,362,772.28 43,499,664,358.95 133,123,519,154.50 3,343,718,019.81 17,831,744,436.63 2,397,936,234.93 156,696,917,845.87
Total assets in the financial statements 156,696,917,845.87
Segment liabilities 10,648,908,871.15 700,175,249.44 140,580,616.21 9,017,491,838.33 11,995,283,584.80 32,502,440,159.93 757,665,748.51 1,010,340,736.41 27,436,263,588.78 61,706,710,233.63
Total liabilities in the financial statements 61,706,710,233.63
Supplementary
information:
Depreciation and
900,796,294.39 - 2,052,884.92 878,442,775.96 796,377,578.73 2,577,669,534.00 92,199,834.15 174,521,673.45 20,134,304.85 2,864,525,346.45
Amortization
Interest income 42,470,222.92 257,234.76 1,203,144.96 70,701,815.50 83,372,904.82 198,005,322.96 1,266,345.18 1,469,124.45 51,319,225.99 252,060,018.58
Interest expense 183,085,034.75 2,926,671.54 - 203,657,696.95 392,724,564.47 782,393,967.71 28,245,233.91 38,016,163.44 1,241,182,229.48 2,089,837,594.54
Investment income from
long-term equity
129,628,862.78 2,530,919,159.03 347,650,565.12 19,727,531.90 439,240,848.69 3,467,166,967.52 23,454,651.74 237,229,143.96 - 3,727,850,763.22
investment under equity
method
Long-term equity
investment under equity 2,592,565,388.68 24,772,038,158.14 6,078,963,750.12 640,212,907.12 11,061,215,279.18 45,144,995,483.24 768,727,807.74 12,002,816,092.28 - 57,916,539,383.26
method
Non-current assets other
than long-term equity 21,153,911,773.00 294,462,264.01 27,181,862.66 21,955,658,532.67 28,203,528,560.52 71,634,742,992.86 2,302,277,585.20 5,405,248,897.19 455,073,380.68 79,797,342,855.93
investment
- 171 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(XIV) OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(2) Segment financial information - continued
The Group's revenue by geographical areas of operations and information about its non-current assets other than
financial instruments and deferred tax assets presented based on the geographical areas in which the assets are located
as follows:
Amount incurred in Amount incurred in
Revenue from external transactions
the current period the prior period
Mainland China, Hong Kong and Taiwan 9,117,570,900.78 8,872,027,132.24
Pearl River Delta 5,522,529,825.59 5,629,472,123.72
Yangtze River Delta 73,413,401.10 -
Bohai Rim 187,910,723.37 194,445,939.20
Others 3,333,716,950.72 3,048,109,069.32
Other locations 3,500,959,095.24 3,251,802,291.50
Total 12,618,529,996.02 12,123,829,423.74
Total non-current assets Closing balance Opening balance
Mainland China, Hong Kong and Taiwan 105,086,211,442.75 96,489,027,270.44
Pearl River Delta 45,433,724,023.01 43,196,515,110.55
Yangtze River Delta 32,716,973,145.44 25,066,500,422.16
Bohai Rim 6,903,596,351.63 6,686,470,964.43
Others 20,031,917,922.67 21,539,540,773.30
Other locations 39,164,278,189.74 41,224,854,968.75
Total 144,250,489,632.49 137,713,882,239.19
(3) Degree of reliance on major customers
The total operating income derived from the top five clients of the Group is RMB 3,455,856,420.54, accounting for
27.39% of the Group's total operating income.
(XV) NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS
1. Other receivables
1.1 Summary of other receivables
Item Closing balance Opening balance
Interest receivable - -
Dividends receivable 311,297,793.86 207,259,421.40
Other receivables 791,414,958.18 598,275,341.87
Total 1,102,712,752.04 805,534,763.27
- 172 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(XV) NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS -continued
1. Other receivables - continued
1.2 Dividends receivable
(1) Disclosure of dividends receivable
Company name Closing balance Opening balance
Dongguan Shenchiwan Port Affairs Co., Ltd. - 103,355,370.74
Dongguan Shenchiwan Wharf Co., Ltd. 147,233,909.98 88,196,930.66
China Merchants Bonded Logistics Co., Ltd. 15,707,120.00 15,707,120.00
Chiwan Wharf Holdings (Hong Kong) Ltd. 147,680,363.88 -
Jiangsu Expressway Company Limited 460,000.00 -
Shenzhen Petrochemical Industry (Group) Co., Ltd. 216,400.00 -
Total 311,297,793.86 207,259,421.40
Less: Provision for credit loss - -
Carrying amount 311,297,793.86 207,259,421.40
(2) Significant dividends receivable with aging over 1 year
Closing
Item Reason for outstanding Impaired or not
balance
Dongguan Shenchiwan Wharf In processing and expected to be
147,233,909.98 No
Co., Ltd. received in 2021
China Merchants Bonded In processing and expected to be
15,707,120.00 No.
Logistics Co., Ltd. received in 2021
Total 162,941,029.98
1.3 Other receivables
(1) Disclosure of other receivables by aging
Closing balance
Aging Provision for credit Proportion of
Other receivables
loss provision (%)
Within 1 year 463,637,726.23 - -
1 to 2 years 327,777,231.95 - -
2 to 3 years - - -
Over 3 years 383,456.60 383,456.60 100.00
Total 791,798,414.78 383,456.60
(2) Provision for credit loss of other receivables
As part of the Company's credit risk management, the Company performs internal credit rating on customers, and
determines the expected loss ratio of other receivables under each credit rating. Such expected average loss ratio is
based on historical actual impairment and taking into consideration of current and expected future economic
conditions.
- 173 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(XV) NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS -continued
1. Other receivables - continued
1.3 Other receivables - continued
(2) Provision for credit loss of other receivables - continued
At 31 December 2020, the credit risk and expected credit loss of other receivables by categories of customers are as
follows:
Closing balance Opening balance
Expected Lifetime Lifetime
Credit rating credit loss Lifetime ECL Lifetime ECL
ECL ECL
ratio (%) 12-month ECL (credit- Total 12-month ECL (not credit- Total
(not credit- (credit-
impaired) impaired)
impaired) impaired)
A 0.00-0.10 791,414,958.18 - - 791,414,958.18 598,275,341.87 - - 598,275,341.87
B 0.10-0.30 - - - - - - - -
C 0.30-50.00 - - - - - - - -
D 50.00-100.00 - - 383,456.60 383,456.60 - - 383,456.60 383,456.60
Carrying amount 791,414,958.18 - 383,456.60 791,798,414.78 598,275,341.87 - 383,456.60 598,658,798.47
Provision for
- - 383,456.60 383,456.60 - - 383,456.60 383,456.60
credit loss
Book value 791,414,958.18 - - 791,414,958.18 598,275,341.87 - - 598,275,341.87
(3) Changes in provision for credit loss of other receivables
Stage I Stage II Stage III
Item Lifetime ECL Lifetime ECL Total
12-month ECL
(not credit-impaired) (credit-impaired)
Balance at 1 January 2020 - - 383,456.60 383,456.60
Carrying amount of other receivables at 1 January 2020
-- transfer to stage II - - - -
-- transfer to stage III - - - -
-- transfer back to stage II - - - -
-- transfer back to stage I - - - -
Provision for the year - - - -
Reversal - - - -
Transfer out due to
derecognition of financial assets - - - -
(including direct write-down)
Other changes - - - -
Balance at 31 December 2020 - - 383,456.60 383,456.60
(4) Other receivables by nature
Item Closing balance Opening balance
Amounts due from related parties 785,752,325.78 571,663,096.21
Advances 3,862,191.69 26,283,930.19
Deposits - -
Others 2,183,897.31 711,772.07
Total 791,798,414.78 598,658,798.47
Less: Provision for credit loss 383,456.60 383,456.60
Book value 791,414,958.18 598,275,341.87
(5) There is no other receivables write-off during this year.
- 174 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(XV) NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS -continued
1. Other receivables - continued
(6) The top five balances of other receivables classified by debtor
Proportion of the
Closing balance of
amount to the closing
Company name Nature Closing balance Aging provision for
balance of other
credit loss
receivables (%)
Shenzhen Haixing Harbor Loan to related
785,752,325.78 Within 2 years 99.24 -
Development Co., Ltd. parties
China Merchants (Liaoning) Port Advance payments
2,000,000.00 Within 1 year 0.25 -
Development Co., Ltd. for account current
Shenzhen Shekou Local Taxation
Other 711,772.07 Above 3 years 0.09 383,456.60
Bureau
Broadford (Shenzhen) Port Advance payments
89,862.49 Within 1 year 0.01 -
Development Co., Ltd. for account current
China Merchants Apartment
Advance payments
Development (Shenzhen) Co., 14,068.00 Within 1 year - -
for account current
Ltd.
Total 788,568,028.34 99.59 383,456.60
- 175 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(XV) NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS - continued
2. Long-term equity investments
Changes for the year
Reconciling Announced Closing balance
Investee 1/1/2020 Investment items from 31/12/2020 of impairment
Other equity distribution of Impairment
Increase Decrease income under other Others provision
movements cash dividends or provision
equity method comprehensive
profit
income
I. Subsidiary
Shenzhen Chiwan International Freight Agency
5,500,000.00 - - - - - - - - 5,500,000.00 -
Co., Ltd.
Shenzhen Chiwan Harbor Container Co. Ltd. 250,920,000.00 - - - - - - - - 250,920,000.00 -
Shenzhen Chiwan Port Development Co., Ltd. 206,283,811.09 - - - - - - - - 206,283,811.09 -
CWHK 1,070,000.00 - - - - - - - - 1,070,000.00 -
Shenzhen Chiwan Tugboat Co., Ltd. 24,000,000.00 - - - - - - - - 24,000,000.00 -
Chiwan Container Terminal Co., Ltd. 421,023,199.85 - - - - - - - - 421,023,199.85 -
Dongguan Shenchiwan Port Affairs Co., Ltd. 186,525,000.00 - - - - - - - - 186,525,000.00 -
Dongguan Shenchiwan Wharf Co., Ltd. 175,000,000.00 - - - - - - - - 175,000,000.00 -
Chiwan Shipping (Hong Kong) Limited 1,051,789.43 - - - - - - - - 1,051,789.43 -
CMPort (Note 1) 27,286,943,610.42 985,995,529.57 - - - - - - - 28,272,939,139.99 -
CMPort (Zhoushan) RoRo Logistics Co., Ltd. 149,709,800.00 - - - - - - - - 149,709,800.00 -
Zhanjiang port (Note 2) 371,530,912.93 3,010,294,615.59 - - - - - - - 3,381,825,528.52 -
Subtotal 29,079,558,123.72 3,996,290,145.16 - - - - - - - 33,075,848,268.88 -
II. Associate
International Information Technology Company 20,643,611.18 - - 3,190,099.79 - - - - - 23,833,710.97 -
China Merchants Bonded Logistics Co., Ltd. 365,855,724.95 - - 18,791,432.65 - - - - - 384,647,157.60 -
China Merchants Northeast Asia Development &
- 1,000,000,000.00 - 7,786,285.71 - - - - - 1,007,786,285.71 -
Investment Company(Note 3)
Ningbo Zhoushan Port Company Limited(Note 3) - - - - - - - - 1,500,464,520.87 1,500,464,520.87 -
Subtotal 386,499,336.13 1,000,000,000.00 - 29,767,818.15 - - - - 1,500,464,520.87 2,916,731,675.15 -
III. Joint venture
Yantai Port Group Laizhou Port Co., Ltd. 792,062,228.58 - - 24,750,032.44 - - -33,980,174.52 - - 782,832,086.50 -
China Merchants Antong Logistics Management 8,256,893.80 - - 846,094.22 - - - - - 9,102,988.02 -
Company
Fujian Zhaohang Logistics Management
- 450,000,000.00 - 2,283,105.00 - - - - - 452,283,105.00 -
Partnership (Limited Partnership)(Note 3)
Subtotal 800,319,122.38 450,000,000.00 - 27,879,231.66 - - -33,980,174.52 - - 1,244,218,179.52 -
Total 30,266,376,582.23 5,446,290,145.16 - 57,647,049.81 - - -33,980,174.52 - 1,500,464,520.87 37,236,798,123.55 -
Note 1: Details are set out in Note (VII) 1.
Note 2: In 2020, the Company acquired 27.35% of the shares of Zhanjiang Port, which was previously held by its subsidiary Chiwan Wharf Holdings (Hong Kong) Ltd.
Note 3: Details are set out in Note (V) 13.
- 176 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
(Unless otherwise specified, the monetary unit shall be RMB.)
(XV) NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS -
continued
3. Operating income and operating costs
Amount incurred in Amount incurred in
Item the current period the prior period
Revenue Cost Revenue Cost
Principal operating - - 75,207,466.30 75,438,994.71
Other operating 6,653,002.66 2,265,959.64 16,835,131.75 645,029.02
Total 6,653,002.66 2,265,959.64 92,042,598.05 76,084,023.73
4. Investment income
(1) Details of investment income
Amount incurred in Amount incurred in
Item
the current period the prior period
Income from long-term equity investments under cost method 2,871,566,529.89 1,221,470,436.60
Long-term equity investments income under equity method 57,647,049.81 70,092,131.84
Income from other equity instruments investments 8,567,900.00 10,822,585.00
Income from held-for-trading financial assets 13,161,408.95 -
Income from debt investments 24,700,958.91 3,837,808.22
Total 2,975,643,847.56 1,306,222,961.66
(2) Income from long-term equity investments under cost method
Reason for changes
Amount incurred in Amount incurred in
Investee comparing with prior
the current period the prior period
year
Changes in profit
CWHK 1,347,680,363.88 -
distribution of investee
Changes in profit
CMPort 982,379,582.35 1,116,334,395.76
distribution of investee
Changes in profit
Chiwan Container Terminal Co., Ltd. 275,313,936.56 105,136,040.84
distribution of investee
Changes in profit
Shenzhen Chiwan Harbor Container Co. Ltd. 121,071,884.15 -
distribution of investee
Changes in profit
Dongguan Shenchiwan Port Affairs Co., Ltd. 60,234,278.79 -
distribution of investee
Changes in profit
Dongguan Shenchiwan Wharf Co., Ltd. 59,036,979.32 -
distribution of investee
Changes in profit
Shenzhen Chiwan Tugboat Co., Ltd. 25,604,356.23 -
distribution of investee
Shenzhen Chiwan International Freight Changes in profit
245,148.61 -
Agency Co., Ltd. distribution of investee
Total 2,871,566,529.89 1,221,470,436.60
- 177 -
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
1. BREAKDOWN OF NON-RECURRING PROFIT OR LOSS
Item Amount Remarks
Losses on disposal of non-current assets 1,480,572,929.90
Tax refunds or reductions with ultra vires approval or without official
-
approval documents
Government grants recognized in profit or loss (except for grants that
are closely related to the Company's business and are in amounts and 238,216,977.76
quantities fixed in accordance with the national standard)
Money lending income earned from non-financial institutions in profit
232,906,880.87
or loss
The excess of attributable fair value of identifiable net assets over the
-
consideration paid for subsidiaries, associates and joint ventures
Gains or losses on exchange of non-monetary assets -
Gains or losses on entrusted investments or assets management -
Provision of impairment losses for each asset due to force majeure, e.g.
-
natural disasters
Gains or losses on debt restructuring -
Business restructuring expenses, e.g., expenditure for layoff of
-
employees, integration expenses, etc.
Gains or losses relating to the unfair portion in transactions with unfair
-
transaction price
Net profit or loss of subsidiaries recognized as a result of business
combination of enterprises under common control from the beginning -
of the period up to the business combination date
Gains or losses arising from contingencies other than those related to
-
normal operating business
Gains from changes of fair value of held-for-trading financial assets,
derivative financial assets, other non-current financial assets, held-for-
trading financial liabilities, derivative financial liabilities other than
effective hedging operation relating to the Company's normal -409,658,173.58
operations, and the investment income from disposal of the above held-
for-trading financial assets/financial liabilities and other debt
investments
Reversal of provision for accounts receivable that are tested for credit
46,709,066.77
loss individually
Gains or losses on entrusted loans -
Gains or losses on changes in the fair value of investment properties
-
that are subsequently measured using the fair value model
Effects on profit or loss of one-off adjustment to profit or loss for the
period according to the requirements by tax laws and accounting laws -
and regulations
Custodian fees earned from entrusted operation 1,886,792.45
Other non-operating income or expenses other than above -42,615,710.20
Other profit or loss that meets the definition of non-recurring profit or
753,988,749.80
loss (note)
Tax effects -241,651,237.66
Effects of minority interest (after tax) -1,257,863,869.71
Total 802,492,406.40
Note: This mainly represents the gains from remeasurement of previously held equity at fair value upon the
Group's acquisition of Ningbo Daxie.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
2. RETURN ON NET ASSETS AND EARNINGS PER SHARE ("EPS")
The return on net assets and EPS have been prepared by Shenzhen Chiwan Wharf Co., Ltd. in accordance with
Information Disclosure and Presentation Rules for Companies Making Public Offering No. 9 - Calculation and
Disclosure of Return on Net Assets and Earnings per Share (revised in 2010) issued by China Securities Regulatory
Commission.
Weighted average EPS
Item return on net
Basic EPS Diluted EPS
assets (%)
Net profit attributable to ordinary shareholders 5.6628 1.0744 1.0744
Net profit attributable to ordinary shareholders after
3.4625 0.6569 0.6569
deducting non-recurring profit or loss
