Stock Code: 600320 900947 Stock Name: Zhenhua Heavy Zhenhua B-share
Shanghai Zhenhua Heavy Industries Co., Ltd.
Annual Report 2020
CONTENTS
Section I Definitions 03
Section II Company Profile and Principal Financial Indexes 04
Section III Business Profile 08
Section IV Discussion and Analysis of the Performance 10
Section V Important Events 19
Section VI Changes in Ordinary Shares and Shareholders' Situation 34
Section VII Preferred Shares 38
Section VIII Directors, Supervisors, Senior Executives and Employees 39
Section IX Corporate Governance 45
Section X Related Information on Corporate Bonds 47
Section XI Financial Report 48
Section XII List of Reference Documents 199
Important Notice
1 The Board of Directors, Board of Supervisors, directors, supervisors and senior executives
of the Company hereby guarantee the truthfulness, accuracy and completeness of the
contents carried in this annual report, guarantee no false record, serious misleading
statement or great omission carried in this annual report and guarantee to assume the
legal responsibilities jointly and separately.
2 All directors of the Company are present at the board meeting.
3 Ernst & Young LLP. (Special General Partnership) issues the standard audit report without
qualified opinion for the Company.
4 Liu Chengyun, the chairman of the Company, Zhu Xiaohuai, person in charge of
accounting work, and Sun Guangbo, person in charge of accounting agency (accountant
in charge) hereby declare that the financial statements in this Annual Report are true,
accurate and complete.
5 Proposal for profit distribution or common reserves capitalizing during the reporting period
reviewed by the board of directors
Considering the Company’s business plan and the capital demand in 2021, in order
to ensure the Company’s long-term healthy and sustainable development, the profit
distribution proposal for 2020 is as follows: the Company will neither distribute the profits
nor transfer the capital public reserves into the paid-in capital.
6 Risk declaration of forward-looking statements
□Applicable √ Not Applicable
7 Does the Company have non-operating funds occupied by the holding shareholder and its
related parties?
No
8 Does the Company provide the external guarantees in breach of the stipulated decision-
making procedure?
No
9 Whether more than half of the directors cannot guarantee the authenticity, accuracy and
completeness of the annual report disclosed by the Company?
No
10 Major Risk Warning
The company has described the related potential risks in this annual report. Investors may
pay attention to the same. Please refer to discussion and analysis of the performance
and related chapters for the risks the company may be confronted with in the future
development.
11 Others
□Applicable √ Not Applicable
2
2020
Section I Definitions
I. Definitions
The terms used in this report shall be defined as follows, unless otherwise specified:
Definitions of high frequency terms
Company, the Company Refers to Shanghai Zhenhua Heavy Industries Co., Ltd.
CCCC Refers to China Communications Construction Company Ltd.
CCCG Refers to China Communications Construction Group Co., Ltd.
CCCG HK Refers to CCCG (HK) Holding Limited
Reporting period Refers to From Jan. 1, 2020 to Dec. 31, 2020
3
Section II Company Profile and Principal Financial Indexes
1 Company Information
Company name in Chinese 上海振华重工（集团）股份有限公司
Abbreviation of the Company name in Chinese 振华重工
Company name in English SHANGHAI ZHENHUA HEAVY INDUSTRIES CO.,LTD.
Abbreviation of the Company name in English ZPMC
Legal representative of the Company Liu Chengyun
2 Contact Information
Secretary of the Board of Directors
Name Sun Li
Address No. 3261, Dongfang Road, Shanghai
Telephone 021-50390727
Fax 021-31193316
E-mail IR@ZPMC.COM
3 Basic Information
Registered address No.3470, Pudong South Road, Shanghai
Postal code of registered address 200125
Office address No. 3261, Dongfang Road, Shanghai
Postal code of office address 200125
Website http://www.zpmc.com
E-mail IR@ZPMC.COM
4 Information disclosure and placement location
Newspaper designated by the Company for information
Shanghai Securities News, Hong Kong Wen Wei Po
disclosure
Website designated by China Securities Regulatory
Commission (CSRC) for publishing the annual report of the www.sse.com.cn
Company
Placement location of the annual report of the Company Securities Affairs Office
4
2020
5 Stock information
Stock Information
Stock type Stock exchange Stock abbreviation Stock code Stock abbreviation before change
A-share Shanghai Stock Exchange (SSE) Zhenhua Heavy 600320 ZPMC Industries
B-share Shanghai Stock Exchange (SSE) Zhenhua B-share 900947 -
6 Other relevant information
Name Ernst & Young LLP (Special General Partnership)
Public accounting
Room 01-12, Floor 17th, Ernst & Young Tower Oriental Plaza, No.1
firm engaged by the Office address
East Changan Street, Dongcheng District, Beijing
Company (domestic)
Signed by the Accountants Liu Wei, Gu Chengli
7 Main accounting data and financial indexes in recent three years
(I) Main accounting data
Unit: Yuan Currency: CNY
Year-on-year
Main accounting data 2020 2019 2018
change (%)
Operating revenue 22,655,141,652 24,595,587,883 -7.89 21,812,389,644
Operating revenue after deducting the business income
unrelated to primary business and the income without 22,396,639,375 / / /
commercial substance
Net profit attributable to the shareholders of the listed
422,240,299 514,930,143 -18.00 443,005,092
company
Net profit attributable to the shareholders of the listed
-58,462,207 311,117,615 -118.79 121,335,528
company after deducting the non-recurring profits and losses
Net cash flows from operating activities 819,389,020 1,290,213,109 -36.49 553,943,979
At the end of At the end of Year-on-year At the end of
2020 2019 change (%) 2018
Net assets attributable to the shareholders of the listed
14,570,822,140 15,543,404,014 -6.26 15,185,861,952
company
Total assets 79,320,644,540 74,410,783,300 6.60 70,598,364,627
(II) Major financial indexes
Major financial indexes 2020 2019 Year-on-year change (%) 2018
Basic earnings per share (RMB/share) 0.080 0.098 -18.37 0.084
Diluted earnings per share (RMB/share) 0.080 0.098 -18.37 0.084
Basic earnings per share after deducting non-
-0.011 0.059 -118.64 0.023
recurring profits and losses (RMB/share)
Weighted average ROE (%) 3.04 3.39 -0.35 2.92
Weighted average ROE after deducting non-recurring
-0.43 2.06 -2.49 0.80
profits and losses (%)
5
Notes to the main accounting data and financial indexes in the past 3 years before the end of the reporting period
□Applicable √ Not Applicable
1 Differences in accounting data under domestic and overseas accounting standards
1.Difference in net profits and net assets attributable to the shareholders of the listed company in the financial statement
synchronously disclosed under the international and national accounting standards
□Applicable √ Not Applicable
2.Difference in net profits and net assets attributable to the shareholders of the listed company in the financial statement
synchronously disclosed under the domestic and overseas accounting standards
□Applicable √ Not Applicable
3.Explanation for differences between the domestic and overseas accounting standards:
□Applicable √ Not Applicable
1 Main financial data in 2020 by quarters
Unit: Yuan Currency: CNY
Q1 Q2 Q3 Q4
(Jan. to Mar.) (Apr. to Jun.) (Jul. to Sep.) (Oct. to Dec.)
Operating revenue 4,415,427,928 4,715,971,907 5,341,644,401 8,182,097,416
Net profit attributable to the shareholders of the listed company -92,971,034 109,610,761 175,488,612 230,111,960
Net profit attributable to the shareholders of the listed company
100,767,019 28,640,017 -58,544,317 -129,324,926
after deducting the non-recurring profits and losses
Net cash flows from operating activities -375,004,585 419,553,753 23,089,584 751,750,268
Notes to differences between the quarterly data and the data in periodically disclosed reports
Applicable √ Not Applicable
10 Non-recurring profit and loss items and amount
√ Applicable □ Not Applicable
Unit: Yuan Currency: CNY
Amount in Note Amount in Amount in
Non-recurring profit and loss items
2020 (if applicable) 2019 2018
Profit or loss from disposal of non-current assets 36,620,758 49,091,913 155,557,716
Government subsidies included in current profits and losses except
for government subsidies closely related to the Company business, in
97,849,026 93,271,980 114,412,517
line with national policies and obtained by quota or quantity at unified
state standards
Profit or loss on changes in fair values of held-for-trading financial
assets, derivative financial assets, held-for-trading financial liabilities
and derivative financial liabilities, and investment income obtained
from disposal of held-for-trading financial assets, derivative financial 356,116,979 146,517,397 74,200,750
assets, held-for-trading financial liabilities, derivative financial
liabilities and other credit investment, except for effective hedging
operations associated with the company's normal operations
Reversal of provision for impairment of receivables subject to
78,007,100 150,327,138
separate impairment test
Other non-operating revenue and expenses except for the above-
4,718,614 -18,553,180 -67,069,856
mentioned items
Affected amount of minority equity -15,226,311 -23,013,076 -30,908,588
Affected amount of income tax -77,383,660 -43,502,506 -74,850,113
Total 480,702,506 203,812,528 321,669,564
6
2020
11 Items measured at fair value
√ Applicable □ Not Applicable
Unit: Yuan Currency: CNY
Impact on
December 31, December 31, Current
Item current
2019 2020 change
profits
Jiangxi Huawu Brake Co., Ltd. 132,211,332 228,142,450 95,931,118 81,991,399
Qingdao Port International Co., Ltd. 510,671,771 415,582,601 -95,089,170 -58,710,297
China Railway Signal & Communication Corporation Limited 479,560,537 269,294,333 -210,266,204 -150,959,680
Shenwan Hongyuan Group Co., Ltd. 1,119,345 1,154,324 34,979 47,226
COSCO Shipping Holdings Co., Ltd. 585,555,555 679,011,665 93,456,110 423,923,787
Derivative financial assets 22,235,244 0 -22,235,244 3,153,419
Derivative financial liabilities -7,312,741 -458,882 6,853,859 5,825,780
Equity instrument investment 8,438,278 8,438,278 0 0
Hunan Fengri Power & Electric Co., Ltd. 24,348,689 22,685,894 -1,662,795 0
CCCC Highway Bridges National Engineering Research
17,649,136 19,319,276 1,670,140 0
Centre Co., Ltd.
CCCC National Engineering Research Center of Dredging
9,005,378 8,000,908 -1,004,470 0
Technology and Equipment Co., Ltd.
Shenyang Weichen Crane Equipment Co., Ltd. (Former
name: Shanghai Zhenhua Port Machinery (Group) Shenyang 2,865,664 4,197,036 1,331,372 938,696
Elevator Co., Ltd.)
Ningbo Weilong Port Machinery Co., Ltd. (Former name:
7,241,610 6,565,227 -676,383 5,108,263
ZPMC Ningbo Transmission Machinery Co., Ltd)
ZPMC Longchang Lifting Equipment Co., Ltd (Former name:
Shanghai Zhenhua Port Machinery (Group) Longchang 870,791 737,410 -133,381 125,025
Lifting Equipment Co., Ltd.)
CCCC Tianhe Mechanical Equipment Manufacturing Co.,Ltd. - 330,094,057 330,094,057 3,627,322
Total 1,794,460,589 1,992,764,577 198,303,988 315,070,940
12 Others
□Applicable √ Not Applicable
7
Section III Business Profile
I. Main business, business model of the Company and the industrial profile during the reporting period
The Company is a famous heavy-duty equipment manufacturer, and a state-owned listed company on A and B shares,
with the headquarters in Shanghai and multiple production bases in Shanghai and Nantong. It is also the biggest port heavy-
duty machinery equipment manufacturer in the world. The business scope of ZPMC mainly covers: marine heavy industry,
heavy special steel structure, marine transportation and installation, system integration, engineering general contracting,
electrical product, software development and integration, investment and financing business, integrated services. While
constantly consolidating its traditional business advantages, it is also actively expanding smart industries, livelihood
consumption, integrated development and digital industries.
The business scope of the Company covers: design, construction, installation and contracting of large port loading and
unloading system and equipment, offshore heavy equipment, engineering machinery, engineering vessels and large metal
structural parts and their parts and components; ship repair; leasing of equipment; leasing of self-owned houses; leasing of
self-produced crane; sales of the products made by the sales company; international sea transportation by special purpose
vessels that can be transported with the whole equipment; specialized contracting of steel structure engineering; construction
of electric construction engineering; and construction of electromechanical installation and construction engineering; research
and development, installation and sales of oil and gas exploration equipment and mechanical engineering equipment;
design of marine engineering buildings; technology development, technical consulting, technical services, and technology
transfer in the fields of computer software and information, computer network, mechanical technology, environmental
protection technology, new energy technology, intelligent technology; installation and maintenance of railway and urban rail
transportation equipment and accessories; property management; loading, unloading, handling and storage; parking lot
(warehouse) operation and management; import and export business of goods and technologies (In case of quota, license
management, special regulations, quality inspection, safety inspection and construction qualification requirements involved,
it shall not carry out the business activities before obtaining the corresponding qualifications or licenses in accordance with
the relevant national regulations).[Items subject to approval according to law can be carried out only after such approval is
granted by the competent authorities]
In recent years, the traditional ports are gradually upgraded towards automation, digitization and intelligence, and are
transforming to the new operation mode of “smart port” and “green port”. Accordingly, the port machinery and equipment are
also developing towards high efficiency, automation, digitization, intelligence, “green” model and environmental protection. By
increasing the investment in scientific and technological research and development, deepening the cooperation with strategic
customers and cross-industry cooperation, ZPMC has actively expanded new business fields and further strengthened its
competitive advantage while consolidating its leading position in the industry.
II. Explanation for major changes in prime assets of the Company during the reporting period
□Applicable √ Not Applicable
III. Analysis of the core competitiveness during the reporting period
√ Applicable □ Not Applicable
1 Leading R & D capability
The Company has adhered to the top-level design of scientific and technological innovation and made overall planning
of the science and technology innovation system. The design and R&D center of the Company has been building a scientific
and technological innovation system with the ZPMC characteristics from many aspects, actively expanded the cooperation
space of open innovation alliance, focused on the key technical challenges in the development, strengthened the organic
connection of innovation chain and industrial chain with the market demand, and has built an open technology innovation
alliance or collaborative innovation platform with many domestic and foreign universities, scientific research institutions and
enterprises.
In 2020, the Company applied for 231 patents, including 99 invention patents and 132 utility models, and was granted
186 patents, including 39 invention patents and 140 utility models; it was also granted 5 international patents, 41 software
copyright registrations, and 2 drawing works registrations. In 2020, the “Research and Application of Key Technologies for
Yangshan Phase IV Super-Large Automated Container Terminal” won the Grand Prize of the Award for Progress in Science
and Technology of Shanghai City, and the “Research and Application of Key Technologies of Super-Large Quayside Bridge
for 3E Container Ships” won the Second Prize of the Award for Progress in Science and Technology of Shanghai City.
Furthermore, the Company has actively participated in national, industrial and local standardization activities and undertook
63 international, national, industrial, local and group standards, of which 40 have been issued.
8
2020
2 Intelligent manufacturing capability in continuous upgrading
In order to improve the product quality and production efficiency, with intelligent equipment and intelligent workshop
as the breakthrough points, the Company has carried out pilot transformation and upgrading of intelligent manufacturing in
several production bases. The automation and intelligent manufacturing were firstly implemented in the key manufacturing
of standardized parts, such as box girder components related steel structure and mechanical accessories in query-side
container crane which was the main product of the Company. In the way of promotion, the Company took the construction
of intelligent workshop as the starting point to make experiments in building the automated, information-based and efficient
production process for quayside bridge box girder components; through the introduction of advanced processing equipment
with data acquisition function such as built-in PLC, intelligent welding robot, RGV unmanned transport vehicle and other
intelligent equipment, as well as in combination with information integration technology, it realized the interconnection
between equipment and the visual management of production site. Through the preliminary building of intelligent workshop,
it solved the problem of low automation level in large-scaled lifting equipment manufacturing industry, greatly reduced the
over dependence on workers, reduced labor cost, and provided guarantee for the control of the quality stability of products,
which was of great reference significance for promoting the adjustment and upgrading of related industrial structure in the
same industry.
3 Global marketing network and digital supply chain platform
The Company has always focused on global development, actively explored the world market, and constantly
strengthened the global network layout of overseas branches. It has established 28 overseas branches in the world,
established good partnership and solid cooperation foundation with local enterprises and upstream and downstream
enterprises of the industry, and continuously exerted its localization advantages. Based on its global operation and service
network, the Company has provided integrated and lean operation and lifecycle service for global customers in a fast,
accurate and comprehensive way. The Company has a service team composed of more than 1000 high-quality professionals
on the site all over the world, which can provide efficient solutions and perfect spare parts service support and supply goods
to the world in the shortest time. Terminexus, a wholly-owned subsidiary of the Company, has built the first digital supply
chain platform in port machinery industry.
9
Section IV Discussion and Analysis of the Performance
I. Discussion and Analysis of the Performance
In 2020, under the guidance of the long-term goal of building a world excellent company with international
competitiveness and the established strategies, the Company has overcome COVID-19 and other unfavorable factors,
enhanced the confidence in development, persisted in reform and innovation, and promoted the epidemic prevention and
control, production and capacity resume, market extension, reform and innovation, environmental protection construction,
risk resolution, poverty alleviation and Party building, which ensured the stable development of the Company.
During the reporting period, the port machinery business of the Company went on expanding and stabilized the basic
development of the Company. The Company products have entered 104 nations and regions, and the Company has won the
bidding for some key projects including Adani, Maersk (Ivory Coast), COSCO Haikou and Xiuying Port. Intelligent straddle
carrier, ship loader and reach stacker development by the Company have achieved “zero” breakthrough in the market.
In offshore business, inventory elimination and new signing of projects were advanced simultaneously, and the sales of
core accessories such as shield machine gearbox were good. In steel structure business, it has implemented many high-
quality projects, including Ivory Coast Bridge, Vanuatu Bridge, Guangdong Jieyang wind power pipe pile, Xiamen Second
Passage, etc. The offshore service business has actively expanded the business in the field of offshore wind power general
contracting. The electrical business has been promoted in an orderly manner, and EZ electronic control has entered 83
nations and regions; the advantages of PV brand are gradually emerging; the intelligent manufacturing project has made
great progress. The integrated service business directly faced the challenge of the spread of overseas epidemic, and
completed the main tasks of comprehensive production and operation objectives. In investment business, the secondary
operation of existing project has achieved remarkable results.
Emerging business made new progress. In smart parking business, it won Hengyang smart parking project and the
multi-storey parking project of Shanghai Shuguang Hospital, and the economic benefits gradually improved. In the livelihood
consumption business, it has actively explored such fields as old residential area renovation, smart campus construction,
and the leasing and sales of prefabricated construction modules, among which the scale of service car business in Xiong’an
area further increased. The integrated development business continued to improve the qualification, the transformation
advantages of main business continued to show, and the key projects are implemented and progressing orderly. The digital
business is gradually expanding, and the operation quality and efficiency of Terminexus e-commerce platform continues to
be optimized.
II.Performance during the reporting period
During the reporting period, the Company realized the operating revenue amounting to RMB 22,655,000,000,
representing a year-on-year decrease of 7.89%; the net profit attributable to the shareholders of the listed company was
RMB 422,000,000, with a year-on-year decrease of 18%; the basic earnings per share was RMB 0.08,with a year-on-year
decrease of 18.37%.
1 Analysis of the performance
1. Analysis table of changes in the related items in profit statement and cash flow statement
Unit: Yuan Currency: CNY
Item Amount in the current period Amount in the same period of the last year Change (%)
Operating revenue 22,655,141,652 24,595,587,883 -7.89
Operating cost 19,413,265,254 20,590,531,322 -5.72
Selling and distribution expenses 105,763,639 122,517,036 -13.67
General and administrative expenses 937,700,839 1,095,131,287 -14.38
Research and development expenditures 737,468,137 887,096,178 -16.87
Financial expenses 1,117,741,864 1,496,586,414 -25.31
Investment income 413,517,783 174,600,552 136.84
Credit impairment loss -138,083,561 -38,761,593 N/A
Assets impairment loss -213,647,223 -52,494,284 N/A
Income from disposal of assets 6,755,688 49,091,913 -86.24
Net cash flows from operating activities 819,389,020 1,290,213,109 -36.49
Net cash flows from investing activities -1,204,413,136 -1,547,161,450 N/A
Net cash flows from financing activities 349,410,948 141,933,820 146.18
10
2020
2. Analysis of revenue and cost
√ Applicable □ Not Applicable
The decrease in operating revenue was mainly caused by the delay of some foreign projects affected by the epidemic.
The decrease in operating cost was mainly caused by the decrease in operating revenue.
The decrease in selling and distribution expenses was mainly caused by the decrease in travel expenses affected by
the epidemic.
The decrease in general and administrative expenses was mainly caused by the decrease in employee compensation.
The decrease in the research and development expenditures was mainly caused by the decrease in the expensed
expenditures for research and development projects of the Company.
The decrease in financial expenses was mainly caused by the decrease in interest expense on bank loans of the
Company.
The increase in the investment income was mainly caused by the increase in the investment income from the disposal
of held-for-trading financial assets of the Company.
The change in credit impairment loss was mainly caused by the increase in the Company’s provision for bad debts of
accounts receivable.
The change in asset impairment loss was mainly caused by the increase in the Company’s provision for inventory
depreciation.
The decrease in the income from disposal of assets was mainly caused by the decrease in the net gains from the
disposal of fixed assets.
The changes in the net cash flows from operating activities were mainly caused by the decrease of tax returns received
by the Company.
The changes in the net cash flows from investing activities were mainly caused by the investment recovery by the
Company and the increase in the cash received from investment income.
The changes in the net cash flows from financing activities were mainly caused by the increase in cash received by the
Company from bank borrowings.
(1) Main businesses by sectors, products and regions
Unit: Yuan Currency: CNY
Main business by products
Gross Year-on- year Year-on-year Year-on-year
Operating
Product Operating cost profit rate change in operating change in change in gross
revenue
(%) revenue (%) operating cost (%) profit rate (%)
Port machinery 14,457,042,916 11,813,606,078 18.28 -12.16 -10.78 -1.27
Heavy-duty equipment 1,062,669,195 994,642,219 6.40 -28.76 -18.35 -11.93
“Building-Transfer”
project and engineering 2,365,760,874 2,220,603,949 6.14 -7.74 -8.58 +0.87
construction
Steel structure and related
3,277,507,651 3,170,269,443 3.27 20.97 23.29 -1.82
income
Marine transport and others 1,233,658,739 1,106,003,124 10.35 24.72 15.27 +7.36
Main business by regions
Gross Year-on- year Year-on-year Year-on-year
Operating
Region Operating cost profit rate change in operating change in change in gross
revenue
(%) revenue (%) operating cost (%) profit rate (%)
Chinese Mainland 12,945,383,848 11,967,807,784 7.55 4.85 6.85 -1.73
Chinese Mainland (export
1,061,063,332 760,474,241 28.33 52.22 117.67 -21.55
sales)
Europe 2,604,103,174 2,329,595,327 10.54 -23.78 -22.06 -1.97
Asia (excluding Chinese
3,289,553,492 2,404,009,133 26.92 -5.20 -3.18 -1.52
Mainland)
North America 1,345,494,819 948,458,084 29.51 -39.01 -44.78 +7.37
South America 444,522,956 451,059,902 -1.47 -53.85 -47.20 -12.77
Africa 468,958,316 264,264,072 43.65 -38.41 -48.55 +11.10
Oceania 237,559,438 179,456,270 24.46 -32.66 -42.45 +12.85
Notes to the main business by sectors, products and regions
1)The amount listed in “Mainland China (export sales)” in “Main business by regions” was the main operation income
11
from the export sales of this Company to the overseas subsidiaries of the Company and then sales to the related projects of
the domestic customers.
2)Affected by the outbreak of COVID-19, the Company’s overseas projects were delayed, resulting in the decrease in
overseas operating revenue by regions.
(2) Analysis table of cost-volume-profit relationship
□Applicable √ Not Applicable
(3) Cost analysis table
Unit: Yuan
By products
Proportion in Proportion of the one Year-
Amount in the
Amount in the total cost in in the same period of on-year
Product Items of cost structure same period of Notes
current period the current the last year in total change
the last year
period (%) costs (%) (%)
Raw material cost, labor Normal operating
Port machinery 11,813,606,078 61.19 13,240,912,286 64.85 -10.78
cost and production cost fluctuations
Heavy-duty Raw material cost, labor Normal operating
994,642,219 5.15 1,218,182,031 5.97 -18.35
equipment cost and production cost fluctuations
Engineering Raw material cost, labor Normal operating
2,220,603,949 11.50 2,428,961,159 11.90 -8.58
construction projects cost and production cost fluctuations
Steel structure and Raw material cost, labor Normal operating
3,170,269,443 16.42 2,571,473,994 12.59 23.29
related income cost and production cost fluctuations
Marine transport Raw material cost, labor Normal operating
1,106,003,124 5.73 959,513,561 4.70 15.27
and others cost and production cost fluctuations
Other information about cost analysis
None
(4) Particulars about main customers and suppliers
√ Applicable □ Not Applicable
The sales volume of top 5 customers was RMB 4.18657 billion, accounting for 19% of total annual sales volume; the
sales volume of the related parties in that of top 5 customers was RMB 897.72 million, accounting for 4% of total annual
sales volume.
The purchase amount of top 5 suppliers was RMB 2.95671 billion, accounting for 12% of total annual purchase amount;
the purchase of the related parties in that of top 5 suppliers was RMB 645.33 million, accounting for 3% of total annual
purchase amount.
Other description
None
3. Expenses
√ Applicable □ Not Applicable
The decrease in selling and distribution expenses was mainly caused by the decrease in travel expenses affected by
the epidemic.
The decrease in general and administrative expenses was mainly caused by the decrease in employee compensation.
The decrease in the research and development expenditures was mainly caused by the decrease in the expensed
expenditures for research and development projects of the Company.
The decrease in financial expenses was mainly caused by the decrease in interest expense on bank loans of the
Company.
4. Investment in R&D
(1) Detail table of investment in R&D
√ Applicable □ Not Applicable
Unit: Yuan
Current expensed investment in R&D 737,468,137
Current capitalized investment in R&D 111,203,919
Total investment in R&D 848,672,056
Proportion of total investment in R&D in operating revenue (%) 3.75
Number of R&D employees in the Company 1,617
Proportion of number of R&D employees in the total employees of the Company (%) 18.6
Proportion of capitalized investment in R&D (%) 13.10
12
2020
(2) Explanation
□Applicable √ Not Applicable
5. Cash flow
√ Applicable □ Not Applicable
The net cash flows from operating activities were RMB 819 million, mainly caused by the decrease of tax returns
received by the Company. The net cash flows from investing activities were RMB -1.204 billion, mainly caused by the
investment recovery and the increase in cash received from investment income. The net cash flows from financing activities
were RMB 349 million, mainly caused by the increase in the cash received from borrowings by the Company.
2 Explanation for the significant changes in profits due to non-main business
□Applicable √ Not Applicable
3 Analysis of assets and liabilities
√ Applicable □ Not Applicable
1. Assets and liabilities
Unit: Yuan
Proportion of the Proportion of the
Amount at Amount at Year- on-
amount at the end amount at the end of
Item the end of the the end of the year change Notes
of the current period the previous period
current period previous period (%)
in total assets (%) in the total assets (%)
Accounts receivable 7,227,065,255 9.11 4,966,175,528 6.67 45.53
Inventories 22,325,839,116 28.15 8,561,251,580 11.51 160.78
Outstanding payments for
— 0.00 12,434,158,624 16.71 -100
construction completed
Contract assets 2,063,296,890 2.60 — 0.00 N/A
Non-current assets due within one
1,884,370,444 2.38 1,313,203,581 1.76 43.49
year
Deferred income tax assets 752,960,672 0.95 486,197,635 0.65 54.87
Other non-current assets 837,004,289 1.06 161,337,287 0.22 418.79
Other non-current financial assets 330,094,057 0.42 — 0.00 N/A
Advances to suppliers 4,893,675 0.01 822,987,986 1.11 -99.41
Contract liabilities 11,195,309,083 14.11 — 0.00 N/A
Amount settled for uncompleted work — 0.00 1,679,950,879 2.26 -100
Payroll payable 188,799,969 0.24 329,978,281 0.44 -42.78
Other payables 481,065,700 0.61 711,389,996 0.96 -32.38
Non-current liabilities due within
1,374,465,319 1.73 7,287,484,513 9.79 -81.14
one year
Long-term borrowings 16,850,299,742 21.24 8,413,339,986 11.31 100.28
Estimated liabilities 261,072,318 0.33 484,000,772 0.65 -46.06
Other description
The increase in accounts receivable was mainly caused by the adjustment of the beginning amount under new revenue
standard.
The increase in inventories was mainly caused by the reclassification of outstanding payments for construction
completed under new revenue standard implemented by the Company.
The decrease in outstanding payments for construction completed was mainly caused by the reclassification of
outstanding payments for construction completed under new revenue standard implemented by the Company.
The increase in contract assets was mainly caused by the reclassification of outstanding payments for construction
completed under new revenue standard implemented by the Company.
The increase in the non-current assets due within one year was mainly caused by the increase in the long-term
receivables due within one year.
The increase in deferred income tax assets was mainly caused by the impact of the adjustment of undistributed profits
at the beginning of the year under new revenue standard on enterprise income tax.
13
The increase in other non-current assets was mainly caused by the reclassification of the contract warranty balance
under new revenue standard implemented by the Company.
The increase in other non-current financial assets was mainly caused by the fair value of the remaining equity after the
Company lost the control of Tianhe Mechanical Equipment Manufacturing Co., Ltd.
The decrease in advances from customers was mainly caused by the reclassification of advances from customers under
new revenue standard implemented by the Company.
The increase in contract liabilities was mainly caused by the reclassification of amount settled for uncompleted work and
advances from customers under new revenue standard implemented by the Company.
The decrease in amount settled for uncompleted work was mainly caused by the reclassification of amount settled for
uncompleted work under new revenue standard implemented by the Company.
The decrease in payroll payable was mainly caused by the decrease in the accrued bonus of the Company.
The decrease in other payables was mainly caused by the Company’s payment of investment funds and other funds to
CCCC.
The decrease in the non-current liabilities due within one year was mainly caused by the decrease in the long-term bank
borrowings due within one year.
The increase in long-term borrowings was mainly caused by the increase in long-term bank borrowings of the Company.
The decrease in estimated liabilities was mainly caused by the decrease in estimated after-sales service cost of the
products.
2. Particulars about main restricted assets by the end of the reporting period
√ Applicable □ Not Applicable
Book value at the
Item Reason for restriction
end of the period
Special fund, letter of guarantee from the bank and guarantee fund for L/C collected
Monetary funds 50,332,396
from the overseas projects and deposited in the overseas supervision account
Fixed assets 2,821,018,550 Collateral for loan
Long-term receivables 5,614,309,162 Hypothecation for loan
Total 8,485,660,108 /
3. Other description
□Applicable √ Not Applicable
4 Analysis of operational information of the industry
√ Applicable □ Not Applicable
During the reporting period, the value of the newly concluded contracts by the Company on the port machinery was
USD 2.933 billion, which was basically the same as that in 2019. The value of the newly concluded contracts on marine
engineering products and steel structure was USD 1.041 billion, with a year-on-year decrease of 28.84%, among which the
one on steel structure was USD 503 million. The value of the newly concluded contracts on investment business was RMB
2.886 billion, with a year-on-year increase of 41.7%.
In the port machinery industry, affected by COVID-19, the investment progress of overseas customers is slowing down,
and the number of overseas orders is decreasing. Due to the development needs, domestic customers have increased
their investments in port machinery and equipment, and the proportion of newly signed domestic orders has increased.
The increase in market demand for traditional new equipment has slowed down. Businesses such as the construction of
automated terminals, after-sales maintenance and renovation of existing equipment have become new bright spots in the
market. With the official commercialization of 5G technology, the cutting-edge technologies such as 5G, artificial intelligence
and big data will accelerate the transformation and upgrading of the port and shipping industry.
In the offshore industry, as the country attaches more importance to the development of the marine economy, the
demand for offshore supporting services such as energy exploitation, transportation, and installation will increase to a certain
extent, but the trend of international oil prices still brings uncertainty to the recovery time of the offshore industry.
The steel structure industry benefited from the increase in investment in infrastructure, and the overall situation of the
industry is more optimistic. At present, the Company focuses on the development of large, heavy and special steel structure
business, and the development trend is sound. However, due to the low access threshold, the competition is fiercer, and the
efficiency needs to be further improved.
The investment industry continues to be optimized, driving the entire industry chain to a new development track.
Domestic investment in industries such as manufacturing, infrastructure, and green energy has entered a stage of high-
quality development. For a long period of time in the future, funds will continue to be biased towards the common benefit of
14
2020
supply and demand, advanced manufacturing and livelihood construction with multiplier effects, infrastructure construction,
and other fields.
For emerging industries, the exploration and application of 5G and digital technologies will continue to empower
manufacturing. The reconstruction of old communities, the construction of prefabricated buildings, and the construction of
smart cities are in line with the needs of the times and present strong development potential. With the support of national
policies, the integrated development industry has gradually optimized its market environment, gradually consolidated its
industrial foundation and integrated its content.
5 Analysis of investment
1. Overall analysis of external equity investment
√ Applicable □ Not Applicable
Investment amount by the end of reporting period 5,027,018,064
Changes in investment amount (RMB) 382,244,511
Investment amount in the same period of the last year 4,644,773,553
Change in investment amount (%) 8.23
(1) Significant equity investment
□Applicable √ Not Applicable
(2) Significant non-equity investment
□Applicable √ Not Applicable
(3) Financial assets measured at fair value
√ Applicable □ Not Applicable
Stock equity held in other listed companies
Changes in
Initial Initial Final Book value Profit or loss
Stock owners’ equity Accounting Source of
Stock code investment shareholding shareholding at the end of in reporting
abbreviation during the subject shares
cost ratio (%) ratio (%) the period period
reporting period
Held-for-trading Purchase on
03969 CRSC 617,854,000 1.16 1.16 269,294,333 -150,959,680 -150,959,680
financial assets market
Held-for-trading Purchase on
06198 Qingdao Port 308,515,588 1.59 1.59 415,582,601 -58,710,297 -58,710,297
financial assets market
Held-for-trading
300095 Huawu Stock 11,071,606 5.88 5.88 228,142,450 81,991,399 81,991,399 Contribution
financial assets
COSCO
Held-for-trading
601919 SHIPPING 420,000,000 0.91 0.45 679,011,665 423,923,787 423,923,787 Subscription
financial assets
HOLDINGS
Stock equity held in financial enterprises
Changes
Initial Initial Final Book value at Profit or loss in owners’
Object Accounting Source of
investment shareholding shareholding the end of the in reporting equity during
name subject shares
cost ratio ratio period period the reporting
period
Shenwan Held-for-trading
200,000 ﹤0.01 ﹤0.01 1,154,324 47,226 47,226 Subscription
Hongyuan financial assets
6 Sales of significant assets and equities
□Applicable √ Not Applicable
15
7 Analysis of the primary holding companies and the joint-stock companies
√ Applicable □ Not Applicable
Unit: Yuan
Registered Net profit/
Company Name Main product or services Assets size
capital (loss)
Construction and installation of large-scale port equipment,
engineering vessels, offshore heavy equipment, mechanical
Shanghai Zhenhua Heavy
equipment, gear box for wind power generation equipment; large-
Industries Group (Nantong) 738,878,329 1,833,587,488 89,433,610
sized reverse branch, transmission mechanism, dynamic positioning,
Transmitter Co., Ltd.
large-sized anchor windlass, offshore oil platform lifting device and
components; design and manufacturing of the accessories.
Nanjing Ninggao New Channel Engaged in the construction, investment and management of
100,000,000 595,688,068 26,778,436
Construction Co., Ltd Nanjing-Gaochun new channel project.
Operation of international offshore sea transportation; ordinary
Shanghai Zhenhua Shipping Co.,
cargo liner traffic in the middle and lower reaches of Yangtze River; 120,000,000 1,775,588,202 59,592,964
Ltd
transportation of port machinery.
Shanghai Zhenhua Port Design, manufacturing and sales of port machinery, engineering
HKD 50,000,000 10,870,885,678 35,397,463
Machinery (Hong Kong) Co., Ltd. vessel, steel structure and other parts
Sales of port loading and unloading machine, bulk cargo and
container machine, port engineering vessels (including floating
Shanghai Zhenhua Heavy
engineering crane), material handling mechanical products and
Industries Port Machinery General 2,184,730,000 3,225,607,726 48,936,687
parts, sales and technical services, installation and maintenance,
Equipment Co., Ltd.
technical consultation of all types of machine and equipment, key
parts of the raw materials and accessories equipment.
Installation of heavy port equipment, engineering vessels, heavy
Nantong Zhenhua Heavy metal structure and its parts; manufacturing and installation of gear
Equipment Manufacturing Co., box, container yard crane, super heavy-duty bridge steel structure, 2,500,000,000 6,287,765,184 12,140,203
Ltd. heavy marine machinery equipment; leasing of cranes; specialized
contracting of steel structures etc.
ZPMC Qidong Marine Engineering
Machinery manufacturing 303,000,000 2,565,416,604 -188,832,950
Co., Ltd.
Agency of international land transport, air transport, ocean
shipping and domestic freight; sales of large-scale port equipment,
engineering vessel equipment and marine materials at home
Shanghai Zhenhua Ocean
and abroad; construction of ocean engineering and leasing of 100,000,000 871,685,063 17,615,479
Engineering Service Co., Ltd
engineering vessels; import and export of goods and technologies,
transit trade, trade between enterprises and trade agency within the
free trade zone.
Zhenhua Pufeng Wind Energy
Installation of offshore wind turbine USD 16,326,531 186,954 -2,207,576
(HongKong) Co., Ltd.
CCCC Financial Leasing Co., Ltd. Finance lease 5,000,000,000 47,306,443,892 526,789,103
China Communications
Construction of port, waterway, highway and bridge. USD 50,000,000 235,069,766 -7,042,723
constructionUSA. Inc
CCCC Estate Yixing Co., Ltd. Real estate development 900,000,000 1,460,500,234 29,913,101
Fabrication and installation of steel structure; construction of
the foundation for offshore wind power facilities, installation and
Jiangsu Longyuan Zhenhua
maintenance of equipment; construction and maintenance of 260,000,000 3,471,495,984 30,359,575
Marine Engineering Co., Ltd
submarine cable system, construction of marine engineering;
installation and maintenance of equipment and leasing of equipment.
Greenland Heavylift (Hongkong)
Marine transport USD 91,975,158 2,074,726,597 -54,103,269
Limited
8 Particulars about structured entities controlled by the Company
□Applicable √ Not Applicable
III. Discussion and analysis of the future development of the Company
1 Industrial structure and trend
√ Applicable □ Not Applicable
The development of port machinery industry is closely related to the development of shipping industry. The recovery
and high-quality development of shipping industry will further promote the port construction, in particular, the trend of digital
16
2020
development and the demand for epidemic prevention and control will speed up the intelligent development of ports.
The proposal of “building a maritime power” has brought new opportunities for the development of offshore industry.
As one of the new energy sources, offshore wind power will attract enterprises to increase resource investment and
construction, and further promote the collaborative development of offshore engineering equipment manufacturing and
marine economy.
Under the background of rapid development of 5G and other emerging technologies, “new infrastructure” has become
an important driving force for the transformation of traditional infrastructure and the development of digital economy in China
and even in the world. The new integrated development mode of public transport and urban construction fields such as
railway, highway and airport will bring opportunities for the transformation and upgrading of traditional infrastructure industry.
The “Belt and Road” initiative has been recognized and supported by the countries along the line. It is in the deep
development period and brings new dynamic to the adjustment of regional planning, the optimization of industrial layout and
the reconstruction of supply value. The new development pattern of “Mutual promotion of domestic and international dual
circulation, with domestic grand circulation being the mainstay” will accelerate the construction and development of important
national strategic areas, and will also bring huge market opportunities for the transformation and upgrading of manufacturing
industry, the development of smart industry, people’s livelihood consumption business, and digital industry, etc.
2 Development strategy of the Company
√ Applicable □ Not Applicable
By taking “equipment manufacturing” as the entity, “capital operation” and “Internet” as two wings, it aims to build “Flag +
Flagship” of Chinese national industry. “One Entity with Two Wings” strategy is a new strategy for transformation and upgrade
of the Company after objectively analyzing the development stage and orientation of the Company, based on national and
industrial development trend at present and in future, around “Industry 4.0” and “Made in China 2025”, by firmly seizing
the development opportunities of the reform of state-owned enterprises “Double Hundred Action”, in combination with the
development features of equipment manufacturing industry. “Capital operation” will help the Company to extend the industrial
chain of the port machine business and create the whole industrial chain of marine heavy industry and offshore wind power;
help the Company and the customers as well as the partners to form a community of a shared future with the capital as the
tie. The digitized transformation and upgrade of the Company under “Internet” can accelerate the upgrade of the information
system in an all-round way and create the cloud platform through the top information-oriented design of the Company to offer
more convenient, efficient, intelligent and integrated service to the global customers. Meanwhile, by using 5G technology as
a carrier, we continue to enrich the concept of "Internet" and use smart port construction as a breakthrough to further expand
the rich connotation of "+ 5G" and apply 5G technology to various fields such as strategy, design, manufacturing, products,
services, etc. to promote the quality revolution, efficiency revolution, power revolution of the Company.
3 Operation plan
√ Applicable □ Not Applicable
Guided by the new development concept for businesses, the Company will closely follow the national development
strategy, seize the new market opportunities brought by the new development pattern, and continuously enhance its core
competitiveness through scientific market research, comprehensive deepening of reform, and increasing scientific and
technological innovation.
For port machinery business of the Company, it will aim to maintain the leading position in the industry, and seize the
global intelligent terminal development opportunity to popularize the intelligent terminal; in the meanwhile, it will pay close
attention to the new changes in the industry, the new needs of users and the new trends of competitors brought by the
domestic port integration; make overall arrangement of the internal resources, innovate the business model, increase the
communication with users, and implement high-end differentiated competition. Offshore business will adhere to differentiated
development and promote the implementation of high-quality offshore projects based on the industry development trend
while improving the performance ability and promoting the resolution of offshore asset risks. Steel structure business will
focus on the opportunities such as economic dual circulation, aim at key areas, expand business channels and enhance
the added value of steel structure products. The marine service business will rationalize the allocation of resources on
the premise of ensuring the competitive advantage of the Company’s primary business, and will pay great attention to the
latest policies of the state on offshore wind power business, and achieve economic benefits with professional industrial
chain through strategic cooperation and differentiated competition. Electrical business will systematically summarize and
analyze the existing business, steadily promote electrical related business, and continue to promote EZ brand. For general
contracting business, it will give full play to the advantages of the existing projects, actively expand other projects in the
region and improve the business scale. For investment business, it will further highlight the main business, strengthen the
lifecycle management of investment projects, and improve the scientificity and rate of return of the investment.
In emerging industries, the smart industry should take advantage of the development trend of artificial intelligence, big
data, cloud computing and other technologies, and continue to march into the field of intelligent transportation and smart
city construction. People’s livelihood consumption should seize the mass market and promote differentiated development.
Integrated development should follow the national policy, identifies the market position, and fully embodies the corporate
17
social responsibility. Digital industry should grasp the development trend of 5G, continuously accumulate data, and take the
advantages of data to create scale and efficiency.
4 Potential risks
√ Applicable □ Not Applicable
Market risk: it mainly includes macroeconomic and industry cycle fluctuation risk. The main business of the Company
is closely related to the operation and development of macro economy and the industry cycle of the shipping industry. The
slowdown of global economy, the trade friction between China and USA and the challenges from the deglobalization trend
on the global economy impose some uncertainties on the development of the Company. Although the shipping industry is
slightly resuscitative, the recovery speed is still uncertain, and the Company’s upstream customers are still cautious about
the new capital investment in ports and terminals.
Countermeasures: the Company will establish a management system for the scientific study and judgment of the macro
political and economic situation, identify the systematic risks in time, and make risk response plans in advance. In the
meanwhile, the Company will focus on user needs, optimize products, improve services, look for increment from the stock,
and continuously optimize its business structure and profit model.
Financial risk: it mainly includes interest rate and exchange rate change risk. The Company’s interest rate risk mainly
comes from interest-bearing liabilities. In addition, a certain proportion of overseas business brings a certain scale of foreign
exchange revenue and expenditure to the Company.
Countermeasures: the Company will strengthen the dynamic study and judgment of capital situation, further strengthen
the overall capital management, broaden financing channels and rationalize financing costs. For exchange rate risk control,
the Company will control exchange rate risks through locking in the forward exchange rate, gradually reduce the foreign
exchange liabilities, pay attention to the research on policies and strategies of foreign exchange risk management, closely
concern the changes in exchange rates, regularly analyze the trend of exchange rate, strictly conduct the approval procedure
related to the transaction of the financial derivatives, do well in statistics of the products, currencies and exchange rates,
further tamp the basic work of the foreign exchange management and reduce the Company’s exchange rate risk.
Since its outbreak, COVID-19 has had a certain impact on the Company’s production and operation. The company is
deeply aware of the arduousness, complexity and long-term nature of epidemic prevention and control, and will always take
epidemic prevention and control as the primary guarantee for promoting the daily production and operation of the enterprise.
The Company will pay close attention to and analyze the epidemic situation at home and abroad, and carry out normalized
epidemic prevention and control.
5 Others
□Applicable √Not applicable
V. Explanation for non-disclosure in accordance with the accounting standard due to being not applicable to the
provisions of the standard or state secret and business secrete and other special reasons
□Applicable √Not applicable
18
2020
Section V Important Events
I. Proposal for profit distribution of ordinary shares or convention of capital reserves into bonus shares
1 Formulation, implementation or adjustment of cash dividend distribution policies
√Applicable □Not applicable
According to the requirements of the Circular on Further Implementation of Relevant Matters Concerning Cash
Dividend Distribution of Listed Companies (ZJF [2012] No. 37) issued by the CSRC, as proposed by the 10th meeting of
the Company’s fifth session of Board held on August 21, 2012, amendments were made to the Articles of Association of the
Company concerning profit distribution and cash dividends policy, and as a result, the dividend distribution standard and
proportion became clearer, related decision making process and mechanism were compete, and the minority shareholders’
legal rights and interests were fully protected, giving them the opportunity to fully express their views and demands.
On August 18, 2020, the A-share profit distribution plan of the Company for 2019 was completed by distributing
dividends in cash.
On August 27, 2020, the B-share profit distribution plan of the Company for 2019 was completed by distributing
dividends in cash.
2 The Company’s plan or proposal for profit distribution of ordinary shares, plan or proposal for the convention
of capital reserves into bonus shares in recent 3 years (including the reporting period)
Unit: Yuan Currency: CNY
Net profit attributable
Ratio of the net profit
Bonus to the ordinary
Dividend for Shares attributable to the
Year for shares Amount of shareholders of the
every 10 shares converted for ordinary shareholders
dividend for every cash dividend listed company in the
(Yuan) (tax every 10 shares of the listed company
distribution 10 shares (tax included) consolidated statement
included) (share) in the consolidated
(share) in the year for dividend
statements (%)
distribution
2020 0 0 0 0 422,240,299 0
2019 0 0.5 0 263,417,675 514,930,143 51.16
2018 0 0.5 0 263,417,675 443,005,092 59.46
3 Shares repurchased by offer in cash and included in cash dividends
□Applicable √Not applicable
4 If the profit is positive in the reporting period and the profit of the parent company available for distribution
to the ordinary shareholders is positive but the Company does not represent the plan or proposal for profit
distribution of ordinary shares in cash, the Company shall disclose in detail the reasons and the purpose and use
plan of the undistributed profit
√Applicable □Not applicable
The reason for not representing the plan or proposal for profit distribution of ordinary
Purpose and use plan of the
shares in cash though the profit is positive and the profit of the parent company available
undistributed profit
for distribution to the ordinary shareholders is positive in the reporting period
According to the relevant provisions of the Circular on Further Implementation of Relevant Matters
Concerning Cash Dividend Distribution of Listed Companies and the Regulatory Guidelines for Listed
Companies No. 3 - Cash Dividends of Listed Companies issued by the CSRC, and the articles of
For business development.
association, in order to ensure the long-term healthy and sustainable development of the Company and
safeguard the shareholders’ long-term interests, the Company will not distribute profits or transfer capital
reserve to share capital in view of the business performance in 2020.
19
II. Fulfillment of commitments
1 Commitments of the actual controller, shareholders, related parties, acquirer, companies of the Company in the
reporting period or ongoing at the period-end
□Applicable √Not applicable
2 If there is earnings forecast for the assets or projects of the Company and the reporting period is still in the
earnings forecast period, the Company shall explain whether the asset or project reaches the original earnings
forecast and give the reasons
□Reached □Failing to reach √Not applicable
3 Fulfillment of commitments on the performance and its impacts on goodwill impairment test
□Applicable √Not applicable
III. Fund occupation and progress in returning scheme during the reporting period
□Applicable √Not applicable
IV. Explanation of the Company for Accounting Firm’s “auditors’ report with nonstandard opinions”
□Applicable √Not applicable
V. Analysis and explanation of the Company of the causes and the impacts of the major changes in accounting
policies and accounting estimates or correction of significant accounting errors
1 Analysis and explanation of the Company on the causes and the impacts of the changes in accounting policies
and accounting estimates
√Applicable □Not applicable
See V.44 in Section XI for details.
2 Analysis and explanation of the cause of correction of significant accounting errors and their impacts by the
Company
□Applicable √Not applicable
3 Communication with former CPA firm
□Applicable √Not applicable
4 Other description
□Applicable √Not applicable
VI. Engagement and dismissal of the public accounting firm
Unit: Yuan Currency: CNY
Now engaging
Name of the domestic accounting firm Ernst & Young LLP. (Special General Partnership)
Remuneration of domestic accounting firm 4,700,000
Audit term of the domestic accounting firm 5
Name Remuneration
Accounting firm performing internal control audit Ernst & Young LLP. (Special General Partnership) 450,000
Particulars about the engagement and dismissal of the accounting firm
□Applicable √Not applicable
20
2020
Particulars about reappointment of the accounting firm in the auditing period
□Applicable √Not applicable
VII. Risk of suspension of the listing
1 Cause for shares suspended from listing
□Applicable √Not applicable
2 Countermeasures to be taken by the Company
□Applicable √Not applicable
VIII. Termination of the listing and its reasons
□Applicable √Not applicable
IX. Events related to bankruptcy and reorganization
□Applicable √Not applicable
X. Major lawsuit and arbitration issues
√Existence of major lawsuit and arbitration in the year □No major lawsuit or arbitration in the year
1 Lawsuit and arbitration already disclosed in provisional announcement, without follow-up progress
□Applicable √Not applicable
2 Lawsuit and arbitration not disclosed in provisional announcement, or with follow-up progress
√Applicable □Not applicable
Unit: 10,000Yuan Currency: CNY
In the reporting period:
Estimated
Party Amount Results of Execution of
Type of liabilities and Progress
Plaintiff Defendant bearing involved the lawsuit adjudication
lawsuit and Background of the lawsuit (arbitration) amount caused in lawsuit
(applicant) (respondent) joint in lawsuit (arbitration) of lawsuit
arbitration by lawsuit (arbitration)
liabilities (arbitration) and impacts (arbitration)
(arbitration) or not
At the end of February 2014, the Company
completed the acquisition of the former
Jiangsu Daoda Ocean Engineering Co.,
Ltd through capital increase and held 67%
of the shares. At the same time, it was
Shanghai agreed that the losses of the company,
Zhenhua was borne by the former shareholders
Heavy including Nantong Huafu Port Co., Ltd, Li
Nantong
Industries Aidong and Zhao Xiaohua before February
Huafu Port
Co., Ltd, 28, 2014. During the subsequent business The case is still
Co., Ltd, Li None Lawsuit 36,872.22 0 Not yet judged Not yet judged
and ZPMC process, it was found that the former Daoda pending
Aidong, and
Qidong Company untruthfully disclosed some
Zhao Xiaohua
Marine matters of lawsuit or debts, resulting in a
Engineering series of losses of the Company. Through
Co., Ltd. the related audit and readjustment etc., it
was deemed that the loss of RMB 368.7222
million Yuan should be in borne in the
former shareholders and the lawsuit was
prosecuted again after an inconclusive
press for payment.
3 Other description
□Applicable √Not applicable
XI. Punishment to the listed Company and its directors, supervisors, senior executives, controlling shareholder,
actual controller and acquirer and the rectification
□Applicable √Not applicable
XII. Particulars about the credit conditions of the Company and its controlling shareholder and the actual controller
during the reporting period
□Applicable √Not applicable
21
XIII. The Company’s equity incentive plan, employee stock ownership plan or other incentives to the employees and
their impacts
1 Related incentives disclosed in provisional announcement, without progress or change in follow-up
implementation
□Applicable √Not applicable
2 Incentives not disclosed in provisional announcement or with follow-up progress
Equity incentive
□Applicable √Not applicable
Other description
□Applicable √Not applicable
Information about employee stock ownership plan
□Applicable √Not applicable
Other incentives
□Applicable √Not applicable
XIV. Material related transactions
1 Related transactions relevant to routine business
1. Events disclosed in provisional announcement, without progress or changes in follow-up implementation
□Applicable √Not applicable
2. Events disclosed in the provisional announcement, with progress or changes in follow-up implementation
□Applicable √Not applicable
3. Events not disclosed in provisional announcements
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Reason
Proportion for great
Pricing in the Settlement differences
Type of Price of
Content of related principle Amount of related amount mode of between
Related party Relationship related related Market price
transaction of related transaction of similar associated the bargain
transaction transaction
transaction transactions transaction price and
(%) market
price
China Road & Bridge Holding subsidiary of Selling goods/ Project income/ Pricing based
897,728,442 897,728,442 0.30 Cash 897,728,442 /
Corporation parent company other inflows lease of assets on market price
CCCC Third Harbor Holding subsidiary of Selling goods/ Project income/ Pricing based
424,401,835 424,401,835 0.14 Cash 424,401,835 /
Engineering Co., Ltd. parent company other inflows lease of assets on market price
CCCC Second Harbor Holding subsidiary of Selling goods/ Project income/ Pricing based
283,456,305 283,456,305 0.10 Cash 283,456,305 /
Engineering Co., Ltd. parent company other inflows lease of assets on market price
Jiangsu Longyuan Zhenhua Selling goods/ Project income/ Pricing based
Joint venture 231,829,678 231,829,678 0.08 Cash 231,829,678 /
Marine Engineering Co., Ltd other inflows lease of assets on market price
Road & Bridge International Holding subsidiary of Selling goods/ Project income/ Pricing based
229,793,506 229,793,506 0.08 Cash 229,793,506
Co., Ltd. parent company other inflows lease of assets on market price
CCCC Third Highway Holding subsidiary of Selling goods/ Project income/ Pricing based
173,821,696 173,821,696 0.06 Cash 173,821,696 /
Engineering Co., Ltd. parent company other inflows lease of assets on market price
CCCC Second Highway Holding subsidiary of Selling goods/ Project income/ Pricing based
138,705,156 138,705,156 0.05 Cash 138,705,156 /
Engineering Co., Ltd. parent company other inflows lease of assets on market price
CCCC Electrical and Mechanical Holding subsidiary of Selling goods/ Project income/ Pricing based
88,938,053 88,938,053 0.03 Cash 88,938,053 /
Engineering Co., Ltd. parent company other inflows lease of assets on market price
China Communications Holding subsidiary of Selling goods/ Project income/ Pricing based
78,205,835 78,205,835 0.03 Cash 78,205,835 /
Construction Company Ltd. parent company other inflows lease of assets on market price
CCCC First Harbor Consultants Holding subsidiary of Selling goods/ Project income/ Pricing based
69,444,739 69,444,739 0.02 Cash 69,444,739 /
Co., Ltd. parent company other inflows lease of assets on market price
CCCC Tianjin Industry and Holding subsidiary of Selling goods/ Project income/ Pricing based
50,952,323 50,952,323 0.02 Cash 50,952,323 /
Trade Co., Ltd. parent company other inflows lease of assets on market price
ZPMC-OTL Marine Contractor Selling goods/ Project income/ Pricing based
Joint venture 38,016,390 38,016,390 0.01 Cash 38,016,390 /
Limited other inflows lease of assets on market price
Selling goods/ Project income/ Pricing based
ZPMC Southeast Asia Pte. Ltd Associated company 37,632,123 37,632,123 0.01 Cash 37,632,123 /
other inflows lease of assets on market price
22
2020
Reason
Proportion for great
Pricing in the Settlement differences
Type of Price of
Content of related principle Amount of related amount mode of between
Related party Relationship related related Market price
transaction of related transaction of similar associated the bargain
transaction transaction
transaction transactions transaction price and
(%) market
price
The First Construction
Holding subsidiary of Selling goods/ Project income/ Pricing based
Company of CCCC Second 36,724,138 36,724,138 0.01 Cash 36,724,138 /
parent company other inflows lease of assets on market price
Harbor Engineering Co., Ltd
CCCC - SHEC Third Highway Holding subsidiary of Selling goods/ Project income/ Pricing based
34,008,547 34,008,547 0.01 Cash 34,008,547 /
Engineering Co., Ltd. parent company other inflows lease of assets on market price
Installation Engineering Co.,
Holding subsidiary of Selling goods/ Project income/ Pricing based
Ltd. of CCCC First Harbor 22,123,894 22,123,894 0.01 Cash 22,123,894 /
parent company other inflows lease of assets on market price
Engineering Co. Ltd.
CCCC First Harbor Engineering Holding subsidiary of Selling goods/ Project income/ Pricing based
20,139,620 20,139,620 0.01 Cash 20,139,620 /
Co., Ltd. parent company other inflows lease of assets on market price
CCCC First Highway Holding subsidiary of Selling goods/ Project income/ Pricing based
14,921,008 14,921,008 0.01 Cash 14,921,008 /
Engineering Co., Ltd. parent company other inflows lease of assets on market price
China Harbor Engineering Co., Holding subsidiary of Selling goods/ Project income/ Pricing based
13,927,295 13,927,295 0.00 Cash 13,927,295 /
Ltd. parent company other inflows lease of assets on market price
CCCC Tunnel Engineering Co., Holding subsidiary of Selling goods/ Project income/ Pricing based
12,218,362 12,218,362 0.00 Cash 12,218,362 /
Ltd. parent company other inflows lease of assets on market price
CCCC Yancheng Construction Holding subsidiary of Selling goods/ Project income/ Pricing based
11,855,952 11,855,952 0.00 Cash 11,855,952 /
Development Co., Ltd. parent company other inflows lease of assets on market price
CCCC Shanghai Equipment Holding subsidiary of Selling goods/ Project income/ Pricing based
8,761,075 8,761,075 0.00 Cash 8,761,075
Engineering Co., Ltd. parent company other inflows lease of assets on market price
The Third Engineering Company
Holding subsidiary of Selling goods/ Project income/ Pricing based
of CCCC Fourth Harbor 6,559,140 6,559,140 0.00 Cash 6,559,140
parent company other inflows lease of assets on market price
Engineering Co., Ltd
CCCC First Highway Electrification Holding subsidiary of Selling goods/ Project income/ Pricing based
6,129,210 6,129,210 0.00 Cash 6,129,210
Engineering Co., Ltd parent company other inflows lease of assets on market price
No.3 Co. of The Second
Holding subsidiary of Selling goods/ Project income/ Pricing based
Navigational Engineering 5,053,060 5,053,060 0.00 Cash 5,053,060
parent company other inflows lease of assets on market price
Bureau, CCCC
CCCC - SHEC Electrical Holding subsidiary of Selling goods/ Project income/ Pricing based
4,731,690 4,731,690 0.00 Cash 4,731,690
Engineering Co., Ltd. parent company other inflows lease of assets on market price
CCCC Tianhe Mechanical
Holding subsidiary of Selling goods/ Project income/ Pricing based
Equipment Manufacturing Co., 4,698,839 4,698,839 0.00 Cash 4,698,839
parent company other inflows lease of assets on market price
Ltd
Beijing Rate Electronic Holding subsidiary of Selling goods/ Project income/ Pricing based
3,550,889 3,550,889 0.00 Cash 3,550,889
Technology Developing Co., Ltd. parent company other inflows lease of assets on market price
CCCC Xi’an Road Construction Holding subsidiary of Selling goods/ Project income/ Pricing based
1,327,434 1,327,434 0.00 Cash 1,327,434
Machinery Co., Ltd. parent company other inflows lease of assets on market price
CCCC International Shipping Holding subsidiary of Selling goods/ Project income/ Pricing based
1,044,785 1,044,785 0.00 Cash 1,044,785
Co., Ltd parent company other inflows lease of assets on market price
Road & Bridge International Holding subsidiary of Selling goods/ Project income/ Pricing based
78,509 78,509 0.00 Cash 78,509
Co., Ltd. parent company other inflows lease of assets on market price
No.2 Engineering Co., Ltd. Consigned
Holding subsidiary of Receipt of Pricing based
of CCCC Third Harbor processing for the 691,422,066 691,422,066 0.32 Cash 691,422,066 /
parent company services on market price
Engineering Co., Ltd. Company
Consigned
CCCC Fourth Highway Holding subsidiary of Receipt of Pricing based
processing for the 306,195,275 306,195,275 0.14 Cash 306,195,275 /
Engineering Co., Ltd. parent company services on market price
Company
Consigned
CCCC Second Harbor Holding subsidiary of Receipt of Pricing based
processing for the 301,152,978 301,152,978 0.14 Cash 301,152,978 /
Engineering Co., Ltd. parent company services on market price
Company
Consigned
CCCC Third Harbor Holding subsidiary of Receipt of Pricing based
processing for the 204,828,721 204,828,721 0.10 Cash 204,828,721 /
Engineering Co., Ltd. parent company services on market price
Company
Consigned
CCCC First Highway Holding subsidiary of Receipt of Pricing based
processing for the 201,690,439 201,690,439 0.09 Cash 201,690,439 /
Engineering Co., Ltd. parent company services on market price
Company
Consigned
Holding subsidiary of Receipt of Pricing based
CCCC Tianjin Dredging Co., Ltd. processing for the 100,525,545 100,525,545 0.05 Cash 100,525,545 /
parent company services on market price
Company
Consigned
CCCC Third Highway Holding subsidiary of Receipt of Pricing based
processing for the 60,479,325 60,479,325 0.03 Cash 60,479,325 /
Engineering Co., Ltd. parent company services on market price
Company
Consigned
Receipt of Pricing based
ZPMC Southeast Asia Pte. Ltd Associated company processing for the 59,340,652 59,340,652 0.03 Cash 59,340,652 /
services on market price
Company
Shanghai Communications Consigned
Holding subsidiary of Receipt of Pricing based
Construction Contracting Co., processing for the 36,281,828 36,281,828 0.02 Cash 36,281,828 /
parent company services on market price
Ltd. Company
23
Reason
Proportion for great
Pricing in the Settlement differences
Type of Price of
Content of related principle Amount of related amount mode of between
Related party Relationship related related Market price
transaction of related transaction of similar associated the bargain
transaction transaction
transaction transactions transaction price and
(%) market
price
No. 2 Engineering Co., Ltd. Consigned
Holding subsidiary of Receipt of Pricing based
of CCCC Fourth Highway processing for the 32,430,368 32,430,368 0.02 Cash 32,430,368 /
parent company services on market price
Engineering Co., Ltd. Company
CCCC Water Transportation Consigned
Holding subsidiary of Receipt of Pricing based
Planning and Design Institute processing for the 26,070,990 26,070,990 0.01 Cash 26,070,990 /
parent company services on market price
Co., Ltd. Company
Consigned
Road & Bridge East China Holding subsidiary of Receipt of Pricing based
processing for the 23,620,159 23,620,159 0.01 Cash 23,620,159 /
Engineering Co., Ltd. parent company services on market price
Company
Consigned
CCCC Second Highway Holding subsidiary of Receipt of Pricing based
processing for the 21,674,421 21,674,421 0.01 Cash 21,674,421 /
Engineering Co., Ltd. parent company services on market price
Company
Consigned
CCCC First Highway Fifth Holding subsidiary of Receipt of Pricing based
processing for the 17,768,785 17,768,785 0.01 Cash 17,768,785 /
Engineering Co., Ltd. parent company services on market price
Company
Consigned
CCCC Worldcom (Chongqing) Holding subsidiary of Receipt of Pricing based
processing for the 14,309,194 14,309,194 0.01 Cash 14,309,194 /
Heavy Industries Co., Ltd. parent company services on market price
Company
Consigned
China Road & Bridge Holding subsidiary of Receipt of Pricing based
processing for the 10,988,748 10,988,748 0.01 Cash 10,988,748 /
Corporation parent company services on market price
Company
Consigned
CCCC Second Highway Holding subsidiary of Receipt of Pricing based
processing for the 5,420,288 5,420,288 0.00 Cash 5,420,288 /
Consultants Co., Ltd. parent company services on market price
Company
Consigned
China Communications Holding subsidiary of Receipt of Pricing based
processing for the 4,388,549 4,388,549 0.00 Cash 4,388,549 /
Construction Company Ltd. parent company services on market price
Company
Consigned
CCCC Third Harbor Consultants Holding subsidiary of Receipt of Pricing based
processing for the 3,577,982 3,577,982 0.00 Cash 3,577,982 /
Co., Ltd. parent company services on market price
Company
ZPMC Mediterranean Liman Consigned
Holding subsidiary of Receipt of Pricing based
Makinalari Ticaret Anonim processing for the 3,690,480 3,690,480 0.00 Cash 3,690,480 /
parent company services on market price
Sirketi Company
CCCC Tianhe Mechanical Consigned
Holding subsidiary of Receipt of Pricing based
Equipment Manufacturing Co., processing for the 1,834,862 1,834,862 0.00 Cash 1,834,862 /
parent company services on market price
Ltd Company
Shanghai China
Consigned
Communications Water Holding subsidiary of Receipt of Pricing based
processing for the 1,748,853 1,748,853 0.00 Cash 1,748,853 /
Transportation Design & parent company services on market price
Company
Research Co., Ltd.
Consigned
CCCC First Harbor Consultants Holding subsidiary of Receipt of Pricing based
processing for the 1,293,585 1,293,585 0.00 Cash 1,293,585 /
Co., Ltd. parent company services on market price
Company
Consigned
CCCC Xingyu Technology Co., Holding subsidiary of Receipt of Pricing based
processing for the 1,291,516 1,291,516 0.00 Cash 1,291,516 /
Ltd parent company services on market price
Company
Consigned
Shanghai Waterway Logistics Holding subsidiary of Receipt of Pricing based
processing for the 1,009,174 1,009,174 0.00 Cash 1,009,174 /
Co., Ltd parent company services on market price
Company
Installation Engineering Co., Consigned
Holding subsidiary of Receipt of Pricing based
Ltd. of CCCC First Harbor processing for the 908,257 908,257 0.00 Cash 908,257 /
parent company services on market price
Engineering Co. Ltd. Company
Consigned
CCCC Highway Consultants Holding subsidiary of Receipt of Pricing based
processing for the 258,180 258,180 0.00 Cash 258,180 /
Co., Ltd. parent company services on market price
Company
CCCC Marine Engineering & Consigned
Holding subsidiary of Receipt of Pricing based
Technology Research Center processing for the 207,203 207,203 0.00 Cash 207,203 /
parent company services on market price
Co., Ltd. Company
CCCC WuHan Harbour Consigned
Holding subsidiary of Receipt of Pricing based
Engineering Design and processing for the 68,807 68,807 0.00 Cash 68,807 /
parent company services on market price
Research Co., Ltd. Company
CCCC Shanghai Harbor Consigned
Holding subsidiary of Receipt of Pricing based
Engineering Design & Research processing for the 55,046 55,046 0.00 Cash 55,046 /
parent company services on market price
Institute Co., Ltd. Company
CCCC Shanghai Equipment Holding subsidiary of Purchase of Providing materials Pricing based
645,334,160 645,334,160 0.73 Cash 645,334,160 /
Engineering Co., Ltd. parent company goods for the Company on market price
ZPMC Changzhou Coatings Purchase of Providing materials Pricing based
Associated company 83,224,897 83,224,897 0.09 Cash 83,224,897 /
Co., Ltd goods for the Company on market price
CCCC Tianjin Industry and Holding subsidiary of Purchase of Providing materials Pricing based
66,687,672 66,687,672 0.08 Cash 66,687,672 /
Trade Co., Ltd. parent company goods for the Company on market price
24
2020
Reason
Proportion for great
Pricing in the Settlement differences
Type of Price of
Content of related principle Amount of related amount mode of between
Related party Relationship related related Market price
transaction of related transaction of similar associated the bargain
transaction transaction
transaction transactions transaction price and
(%) market
price
Installation Engineering Co.,
Holding subsidiary of Purchase of Providing materials Pricing based
Ltd. of CCCC First Harbor 61,964,860 61,964,860 0.07 Cash 61,964,860 /
parent company goods for the Company on market price
Engineering Co. Ltd.
Shanghai Jiangtian Industrial Holding subsidiary of Purchase of Providing materials Pricing based
10,044,735 10,044,735 0.01 Cash 10,044,735 /
Co., Ltd. parent company goods for the Company on market price
Chongqing Yongjiang
Expressway Investment and Holding subsidiary of Purchase of Providing materials Pricing based
9,557,213 9,557,213 0.01 Cash 9,557,213 /
Construction Co., Ltd of FHEC parent company goods for the Company on market price
of CCCC
CCCC Shanghai Channel Holding subsidiary of Purchase of Providing materials Pricing based
3,466,483 3,466,483 0.00 Cash 3,466,483 /
Equipment Industry Co., Ltd. parent company goods for the Company on market price
China Communications Holding subsidiary of Purchase of Providing materials Pricing based
2,254,606 2,254,606 0.00 Cash 2,254,606 /
Construction Company Ltd. parent company goods for the Company on market price
CCCC National Engineering
Holding subsidiary of Purchase of Providing materials Pricing based
Research Center of Dredging 2,151,725 2,151,725 0.00 Cash 2,151,725 /
parent company goods for the Company on market price
Technology and Equipment Co., Ltd.
CNPC & CCCC Petroleum Holding subsidiary of Purchase of Providing materials Pricing based
2,047,752 2,047,752 0.00 Cash 2,047,752 /
Sales Co., Ltd. parent company goods for the Company on market price
CCCC (Xiamen) Information Holding subsidiary of Purchase of Providing materials Pricing based
20,971 20,971 0.00 Cash 20,971 /
Co., Ltd parent company goods for the Company on market price
Total / / 5,972,066,878 / / /
Details of large amount of sales returns
The Proposal on Estimating Routine Related Transactions for Years 2019-2021 was approved upon deliberation at the first
provisional general meeting in 2019 of the Company. In 2020, the amount of the annual related transactions in the normal
Explanation for related
business between the Company and its subsidiaries and China Communications Construction Co., Ltd. and its subsidiaries
transactions
did not exceed RMB 10 billion. The Annual General Meeting had authorized the Company’s management to handle the
relevant specific matters.
2 Related transactions arising from acquisition or offering of assets or stock equity
1. Events disclosed in provisional announcement, without progress or changes in follow-up implementation
□Applicable √Not applicable
2. Events disclosed in the provisional announcement, with progress or changes in follow-up implementation
□Applicable √Not applicable
3. Events not disclosed in provisional announcements
□Applicable √Not applicable
4. Where agreed performance is involved, the performance achievement during the reporting period should be
disclosed
□Applicable √Not applicable
3 Material related transactions with joint external investments
1. Events disclosed in provisional announcement, without progress or changes in follow-up implementation
√Applicable □Not applicable
Summary of events Query index
th th
On August 28, the 16 meeting of the 7 board of directors deliberated and Website of Shanghai Stock Exchange: www.sse.com.cn, and
passed the Proposal on Capital Increase and Related Party Transactions of Shanghai Securities News and Hong Kong Wen Wei Po on
CCCC Yancheng Construction Development Co., Ltd. August 29, 2020
On August 28, the 16th meeting of the 7th board of directors deliberated and Website of Shanghai Stock Exchange: www.sse.com.cn, and
passed the Proposal on Giving up the Priority of Capital Increase Right of Shanghai Securities News and Hong Kong Wen Wei Po on
Subsidiaries and Related Party Transactions August 29, 2020
25
2. Events disclosed in the provisional announcement, with progress or changes in follow-up implementation
□Applicable √Not applicable
3. Events not disclosed in provisional announcements
□Applicable √Not applicable
4 Current associated rights of credit and liabilities
1. Events disclosed in provisional announcement, without progress or changes in follow-up implementation
□Applicable √Not applicable
2. Events disclosed in the provisional announcement, with progress or changes in follow-up implementation
□Applicable √Not applicable
3. Events not disclosed in provisional announcements
□Applicable √Not applicable
5 Others
□Applicable √Not applicable
XV. Material contracts and their performance
1 Trusteeship, contracting and leasing matters
1. Trusteeship
□Applicable √Not applicable
2. Contracting
□Applicable √Not applicable
3. Leasing
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Basis for Impacts of
Amount Starting Termination Related
Name of Leased Income from determining income from
Name of lessee involved in date of date of transaction Relationship
lessor assets leasing income from leasing on the
leased assets leasing leasing or not
leasing Company
Shanghai Zhenlong
The Asset Management Lease of August 10,
240,593,148.00 July 9, 2025 47,718,300.00 Agreed 47,718,300.00 No Other
Company Co., Ltd, and other houses 2012
companies
Leasing explanation
None
2 Guarantee
√Applicable □Not applicable
Unit: Yuan Currency: CNY
External guarantee of the Company (excluding guarantee to the subsidiaries)
Relation between Fulfillment Guarantee
Date of guarantee Starting Due Amount of Counter
the guarantor Guaranteed Guaranteed Type of of the Overdue by the
Guarantor (signing date of date of date of overdue guarantee Relationship
and the listed party amount guarantee guarantee or not related party
agreement) guarantee guarantee guarantee or not
company or not or not
Total amount of guarantee incurred during the reporting period (excluding guarantee to the
subsidiaries)
Total balance of guarantee at the end of the reporting period (A) (excluding guarantee to the
subsidiaries)
Guarantee of the Company and its subsidiaries to the subsidiaries
Total amount of guarantee to the subsidiaries incurred during the reporting period -241,324,194
Total balance of guarantee to the subsidiaries at the end of the reporting period (B) 1,810,341,787
Total amount of guarantee of the Company (including guarantee to the subsidiaries)
Total amount of guarantee (A+B) 1,810,341,787
Proportion of total amount of guarantee in the net assets of the Company (%) 10.60
26
2020
Including:
Amount of guarantee to the shareholders, the actual controller and related parties (C)
Amount of debt guarantee directly or indirectly provided to the guaranteed party with the asset-
1,446,253,214
liability ratio over 70% (D)
Amount of guarantee exceeding 50% of net assets (E)
Total guarantee amount of the above three items (C+D+E) 1,446,253,214
Explanation for the joint and several repayment liabilities for the undue guarantee
The Proposal for Providing Financing Guarantee to the Subsidiary Shanghai Zhenhua Port Machinery
(Hong Kong) Co., Ltd. Was approved upon deliberation by the Company at the 1st provisional general
meeting for 2008 held in September 22, 2008, which agreed to provide the financial support to the
Description of guarantee subsidiary in Hong Kong and provided the guarantee with the upper limit of USD 500 million for the
loan it applied for through the bank. Guarantees provided by the Company to subsidiaries during the
reporting period refer to the guarantees to subsidiaries in Hong Kong. Other guarantee matters were
approved upon deliberation at the 30th meeting of the 5th Board of Directors.
3 Consigned cash assets management
1. Consigned financing
(1) General information of consigned financing
□Applicable √Not applicable
Other information
□Applicable √Not applicable
(2) Information on individual consigned financing
□Applicable √Not applicable
Other information
□Applicable √Not applicable
(3) Provision for impairment of consigned financing
□Applicable √Not applicable
2. Consigned loans
(1) General information of consigned loans
□Applicable √Not applicable
Other information
□Applicable √Not applicable
(2) Individual consigned loans
□Applicable √Not applicable
Other information
□Applicable √Not applicable
(3) Provision for impairment of consigned loans
□Applicable √Not applicable
3. Other information
□Applicable √Not applicable
4 Other material contracts
□Applicable √Not applicable
XVI. Particulars about other important events
□Applicable √Not applicable
XVII. Particulars about actively performing social responsibilities
1 Poverty alleviation of the listed company
√Applicable □Not applicable
1. Targeted poverty alleviation program
√Applicable □Not applicable
According to the requirements of the “Decision of the Central Committee of the Communist Party of China and the
State Council on Winning the Battle Against Poverty”, in order to implement the enterprise social responsibility, the Company
established a leading group for poverty alleviation and development and actively carried out the targeted poverty alleviation,
and completed the task of partner assistance in Tue Township, Lanping County, Nujiang Prefecture, Yunnan Province.
2. Summary of annual targeted poverty alleviation
√Applicable □Not applicable
27
In 2020, taking the principle of “Poverty Alleviation after Education” as the main working concept, the Company
centralized the resource to donate a number of indoor and outdoor facilities for Tue Town Kindergarten, including desks and
chairs, siesta bed, all-in-one teaching machine, water dispenser and suspended floor, by which the local education resource
lack was improved. In the early stage of the outbreak of COVID-19, the Company donated a batch of materials to Lanping
County where Tue Town is located to help them fight against COVID-19. It ordered a batch of work clothes from the clothing
companies in Yingjisha County, Xinjiang to create employment and increase income for the filed and registered households,
and actively cooperated with the designated poverty alleviation villages and towns to carry out the training on appropriate
traditional Chinese medicine technology for rural doctors and the training on industrialization development of plateau
characteristic agricultural products. In addition, the Company carried out the poverty alleviation through consumption and
employment there, and participated in the free construction project of Nujiang Dukou Bridge, helping the local infrastructure
construction. The Company won the title of “Targeted Poverty Alleviation Star Enterprise granted” by Lanpei County
Committee of the CPC and Lanping County People’s government in 2020.
3. Effectiveness of targeted poverty alleviation
√Applicable □Not applicable
Unit: 10,000Yuan Currency: CNY
Indicators Amount and progress
I. General condition
Including: 1. Funds 178.08
II. Itemized investment
1. Transfer employment for poverty alleviation
Including: 1.1 Investment in vocational skills training 2.85
1.2 Number of trainees for vocational skills training (person/time) 28
1.3 Number of employed people from filed and registered poor
5
households (person)
2. Poverty alleviation through education
2.1 Investment in improving the education resources in poor areas 41.74
3. Poverty alleviation through health improvement
Including: 3.1 investment in medical and health resources in poor areas 2.51
4. Other items
Overall poverty alleviation funds of CCCG: RMB 600,000;
cost of customized work clothes from Yingjisha County,
Xinjiang: RMB 381,200; poverty alleviation funds from
4.1 Description of other items external units: RMB 50,000; purchase of agricultural
products from poor areas: RMB 206,200; joint investment
in poverty alleviation through consumption with external
units: RMB 72,400
III. Awards (content and level)
Targeted Poverty Alleviation Star Enterprise (county-level)
4. Subsequent targeted poverty alleviation program
√Applicable □Not applicable
In combination with the poverty alleviation requirements of “Continuing to take responsibilities, to implement policies,
to provide support and to supervise after overcoming poverty”, the Company will continue to improve its political position,
enhance the social responsibility as a central enterprise, strengthen the support and publicity, and help Tue Township in
Lanping county to continue to do a good job in compulsory education and labor transfer in the “post poverty alleviation” era,
so as to improve its hematopoietic capacity and create a development outlook with high level of labor force and good quality
of the whole people.
Based on the investigations of poverty alleviation, the Company plans to carry out the poverty alleviation work in 2021 in
the following aspects:
I. Poverty alleviation through Party Building. The Party branch of ZPMC will carry out partner assistance with Yongchang
Community Party branch of Lanping County and Tue Township Party branch.
II. Poverty alleviation through education. By using big data and other methods, it will establish a student growth
database for Tue Center Primary School and Zhenhua Kindergarten to record the growth status, and will develop new “post
poverty alleviation” measures with modern means. At the same time, the Company will strengthen the one-to-one support
propaganda in ZPMC and will continue to do well in poverty alleviation education.
28
2020
III. Poverty alleviation through employment. The Company will provide industrial worker jobs for the surplus labor force
in Tue Township and provide relevant training and teaching, so as to help them grow rapidly and to provide assistance for the
Company’s production base and domestic and foreign port and terminal production operations.
2 Fulfillment of social responsibility
√Applicable □Not applicable
The Company actively performed the social responsibility, enhanced the responsibility management to create the
benefit for shareholders, upgraded the operation quality to create the high quality products for users, responded to the
“Belt and Road” initiative and “Made in China 2025 Strategy” with the actual action, implemented the development strategy
with equipment manufacturing as the center and capital operation and Internet+ as two wings. In addition to the traditional
dominant plates such as port machinery, ocean engineering, system EPC and ocean transportation of heavy cargoes, the
Company also developed the intelligent industry, livelihood consumption, integrated development and digital industry, to
make contribution to the development of entity economy and the construction of the well-off society.
Adhering to the concept of "open development and all-win harmony", the Company speeded up the pace of "going
global", actively promoted the layout of overseas regional centers, and built Terminexus digital intelligent platform, to provide
faster and more efficient services to global users. Every year, the Company may hold the forum on intelligent solutions of
wharf to discuss the development plan with the global professionals. The Company made full use of the platform of China
International Import Expo to achieve mutual benefit and common development with global enterprises.
The Company paid more attention to the green and sustainable development, actively invested in the research and
development of green products, promoted the "change from oil into electricity" technology of dock equipment, and optimized
the environmental protection properties of existing equipment; built intelligent terminals to achieve "zero emission" from
terminals and provided equipment support for the development of clean energy such as solar and wind power. The Company
further increased the investment in environmental protection, improved the existing production equipment and facilities,
and innovate the green production process; strengthened the long-term mechanism for green environmental protection
management, created the environmental protection culture with vitality, set up the special training for environmental
protection, enhance the environmental protection awareness of the staff, and laid a green foundation for promoting the high-
quality development of the Company.
The Company always adhered to the principle of "people-oriented", strengthened the humanistic care for employees,
built a career development platform for employees; strengthened the communication with the community where the
Company is located through activities such as party building and association building; released the Social Responsibility
Report regularly to show the development trend of the enterprise; carried out the targeted poverty alleviation, promoted the
poverty alleviation month by month, and implemented fixed-point poverty alleviation tasks.
3 Environmental Information
1. Information about environmental protection of the Company and its subsidiaries as the key pollutant
discharge units published by environmental protection department
√Applicable □Not applicable
(1) Emission information
√Applicable □Not applicable
During the reporting period, under the guidance of Xi Jinping's ecological civilization thought, the Company
conscientiously implemented the significant national and local decisions and arrangements on eco-environmental protection,
and actively promoted the environmental compliance regulation action and took environmental pollution control as the key
work in the year-round. The Company implemented the subject responsibility and leadership responsibility at all levels,
took the initiative to improve the position and awareness of ecological environmental protection, adhered to the general
requirements of “full coverage, zero tolerance, strict law enforcement and practical effect”, studied and solved the outstanding
problems that restricted the environmental protection work of the Company in accordance with the national laws, regulations
and industry standards, and promoted the environmental rectification and improved the environmental management level.
During the reporting period, the total permitted amount of main pollutants in waste gas of the Company and its major
subsidiaries: 1.13 tons of sulfur dioxide, 2.41 tons of nitrogen oxide, 71.10 tons of particulate matter (total amount control
implemented in some subsidiaries), and 309.27 tons of VOCs; annual actual emissions: 1.09 tons of sulfur dioxide, 2.10
tons of nitrogen oxide, 69.32 tons of particulate matter (actual emissions of the subsidiaries implementing total amount
control: 23.89 tons), and 254.92 tons of VOCs; total permitted amount of main pollutants in wastewater: 480.33 tons of COD
and 35.51 tons of ammonia nitrogen; annual actual emissions: 178.80 tons of COD and 10.32 tons of ammonia nitrogen.
All indicators were in line with the total emission control indicators of the emission permit. According to the supervision
monitoring by environmental protection department and the self-monitoring of the enterprise, all kinds of pollutants
discharged by the Company meet the corresponding emission limits specified in the national “Integrated Emission Standard
of Air Pollutants” (GB 16297-1996), “Integrated Wastewater Discharge Standard” (GB8978-1996), “Emission Standards
of Pollutants for Shipbuilding Industry” (DB31/934-2015), “Emission Standards for Odor Pollutants” (GB14554-1993),
“Integrated Emission Standard of Air Pollutants” (DB31/933-2015), “Emission Standards for Odor Pollutants” (DB31/1025-
2016), “Integrated Emission Standard of Air Pollutants” (GB 16297-1996), “Emission Standard of Air Pollutants for Boiler”
29
(DB31/387-2018), and the “Integrated Emission Standard of Air Pollutants” (DB31/933-2015) of Shanghai City, “Emission
Standard of Air Pollutants for Industrial Kiln and Furnace” (DB31/860-2014), “Integrated Wastewater Discharge Standard”
(DB31/199-2018) and “Emission Standard for Industrial Enterprises Noise at Boundary” (GB12348-2008).
For details of the pollutant emissions of the Company and major subsidiaries, see the table below:
Name of main Over-
Name of the Number Total Permitted
pollutant and Emission Distribution Emission standard
company or of Applicable pollutant emission standards emissions emissions
characteristic mode of outlets concentration emissions
subsidiary outlets in 2020 in 2020
pollutant in 2020
SO2 Emission Standards of Pollutants for Shipbuilding 1.09 1.13 None
Industry (DB31/934-2015), Integrated Emission
NOx Standard of Air Pollutants (DB31/933-2015) of 2.1 2.41 None
Pretreatment,
Shanghai City, Emission Standards for Odor
Shanghai 62 sand washing
Meeting Pollutants (DB31/1025-2016), Emission Standard
Zhenhua Heavy Particulate matter Organized and coating 12.86 18.74 None
relevant of Air Pollutants for Boiler (DB31/387-2018), and
Industries Co., Ltd. emission Emission Standard of Air Pollutants for Industrial Kiln
standards
Changxing Branch and Furnace (DB31/860-2014)
VOCs 142.95 146.5475 None
COD Wastewater Integrated Wastewater Discharge Standard 22.17 189.4 None
2
Ammonia nitrogen outlet (DB31/199-2018) 0.22 14.25 None
Integrated Emission Standard of Air Pollutants
Shanghai Zhenhua Particulate matter 3.51 21.133 None
Pretreatment, Meeting (DB31/933-2015), Emission Standards for Odor
Port Machinery Organized
10 sand washing relevant Pollutants (DB31/1025-2016), and Emission Standard
Heavy Industries emission
and coating standards of Air Pollutants for Industrial Kiln and Furnace
Co., Ltd. VOCs 43.68 60.02 None
(DB31/860-2014) of Shanghai City
Shanghai Zhenhua Particulate matter 6.686 30.14 None
Pretreatment, Meeting
Heavy Industries Port Organized Integrated Wastewater Discharge Standard
9 sand washing relevant
Machinery General emission (DB31/199-2018)
VOCs and coating standards 30.5144 45.56 None
Equipment Co., Ltd.
Particulate matter Sand 4.486 - None
Integrated Emission Standard of Air Pollutants (GB
17 washing and
16297-1996)
Shanghai VOCs coating 30.1405 33.36 None
Meeting
Zhenhua Heavy Organized
relevant
Industries Co., Ltd. COD emission 122.613 139.364 None
standards Integrated Wastewater Discharge Standard (GB8978-
Nantong Branch Wastewater
2 1996), Wastewater Quality Standards for Discharge to
Ammonia outlet
Municipal Sewers (GB/T31962-2015) 2.841 11.23 None
nitrogen
Particulate matter Pretreatment, 40.921 - None
Integrated Emission Standard of Air Pollutants (GB
18 sand washing
16297-1996)
Nantong Zhenhua VOCs and coating 2.668 17.187 None
Meeting
Heavy Equipment Organized
relevant
Manufacturing emission
COD standards 24.616 127.218 None
Co., Ltd. Integrated Wastewater Discharge Standard (GB8978-
Wastewater
1 1996), Wastewater Quality Standards for Discharge to
Ammonia outlet
Municipal Sewers (GB/T31962-2015) 6.624 8.64 None
nitrogen
Particulate matter Integrated Emission Standard of Air Pollutants (GB 0.0209 - None
Pretreatment,
16297-1996), Emission Standard of Air Pollutants for
ZPMC 11 sand washing
Boiler (GB13271-2014), and Emission Standard of Air
Transmission VOCs and coating Meeting 0.7361 - None
Organized Pollutants for Industrial Kiln and Furnace (GB9078-1996)
Machinery relevant
emission
(Nantong) Co., COD standards 2.95 - None
Integrated Wastewater Discharge Standard (GB8978-
Ltd. Wastewater
1 1996), Wastewater Quality Standards for Discharge to
Ammonia outlet
Municipal Sewers (GB/T31962-2015) 0.2467 - None
nitrogen
Reference standards: Integrated Emission Standard
Particulate matter of Air Pollutants (DB31/933-2015) of Shanghai 0.835 1.09 None
Pretreatment,
City, Emission Control Standard of Volatile Organic
10 sand washing
Compounds for Industrial Enterprises (DB12/524-
ZPMC Qidong and coating
VOCs Meeting 2014) of Tianjin City, and Emission Standards for 4.227 6.6 None
Marine Organized
relevant Odor Pollutants (GB14554-1993)
Engineering Co., emission
standards
Ltd.
COD Integrated Wastewater Discharge Standard (GB8978- 6.451 24.35 None
Wastewater
1 1996), Wastewater Quality Standards for Discharge to
Ammonia outlet
Municipal Sewers (GB/T31962-2015) 0.384 1.39 None
nitrogen
Remark: - in the table indicates that the enterprise does not implement total amount control
(2) Construction and operation of pollution control facilities
√Applicable □Not applicable
Based on the existing laws and regulations and the requirements of industrial policies, the Company and its subsidiaries
have comprehensively carried out environmental compliance rectification activities, strengthened the performance of duties
for ecological environmental protection, guided employees to give full play to their subjective initiative, and strengthened
supervision, so as to ensure the compliance and control of the control objectives.
According to the latest environmental protection requirements and the distribution of pollution sources, the Company
and its subsidiaries strengthened the comprehensive treatment of waste gas and wastewater pollutants during the reporting
period. Changxing Base (including Shanghai Zhenhua Heavy Industries Co., Ltd. Changxing Branch, Shanghai Zhenhua
Port Machinery Heavy Industries Co., Ltd., Shanghai Zhenhua Heavy Industries Port Machinery General Equipment Co.,
30
2020
Ltd.) has mainly implemented the rectification project of waste gas treatment facilities in painting workshop, workshop and
outfield welding fume treatment rectification project, non-road mobile machinery renovation project, rainwater and sewage
diversion reconstruction project, initial rainwater collection and treatment project, ambient air automatic monitoring system
construction project, the upgrading of environmental protection facilities for galvanizing workshop of Changxing Branch,
painting shed construction project, hazardous waste warehouse construction project, and paint work construction project,
etc. Nantong Zhenhua Heavy Equipment Manufacturing Co., Ltd has focused on the new paint workshop project and
installed three VOCs automatic monitoring systems. Shanghai Zhenhua Heavy Industries Co., Ltd Nantong Branch, ZPMC
Transmission Machinery (Nantong) Co., Ltd and ZPMC Qidong Marine Engineering Co., Ltd have completed the installation
of 5 VOCs automatic monitoring systems, and promoted the renovation of painting line.
The Company has attached great importance to the operation and management of environmental protection facilities,
established a complete management system, formulated and improved the management system, and all subsidiaries have
worked in strict accordance with ISO14001 environmental management system standards. At present, the environmental
control facilities of the Company have fully covered the waste gas, waste water, noise and solid wastes, and all kinds of
pollution control facilities are in normal operation.
(3) Environmental impact assessment (EIA) of construction project and other administrative licenses for environmental
protection
√Applicable □Not applicable
All the new, reconstruction and expansion projects of the Company strictly implement the relevant management
regulations of “Three Simultaneities” for environmental protection of national and local construction projects, and the projects
have gone through the procedures of environmental impact assessment and completion acceptance. See the table below for
details:
Name of the
EIA approval
company or Project name
/ acceptance
subsidiary
Changxing Island Base construction project of Shanghai Zhenhua Port Machinery Co., Ltd
ZPMC Changxing Island Inland Expansion Project
New 0# Outer Terminal Project of Shanghai Zhenhua Heavy Industries Co., Ltd Changxing Production Base
Acceptance
3# Outer Terminal Project of ZPMC Changxing Base
Shanghai completed
Zhenhua 5# Terminal Project of ZPMC Changxing Island Production Base
Heavy ZPMC Changxing Hot Dip Galvanizing Project
Industries 4# Terminal Reconstruction Project of Shanghai Zhenhua Heavy Industries Co., Ltd Changxing Base
Co., Ltd.
Changxing Intelligent manufacturing workshop for crane box of automated terminal of Shanghai Zhenhua Heavy
Branch Industries Co., Ltd
New hazardous wastes warehouse project of Shanghai Zhenhua Heavy Industries Co., Ltd Changxing EIA approval
Branch has been
obtained
New paint shop project of Changxing Base
2# Gas Station Project of Shanghai Zhenhua Heavy Industries Co., Ltd Changxing Base
Changxing Island Base construction project of Shanghai Zhenhua Port Machinery Co., Ltd
Shanghai ZPMC Changxing Island Inland Expansion Project Acceptance
Zhenhua Port Added integrated workshop of Changxing Export Base Land Expansion Project Phase II completed
Machinery
Intelligent welding line construction project for super large lifting parts
Heavy
Industries Co., Intelligent production transformation and upgrading of port machinery parts EIA approval
Ltd. Technical improvement project of painting automatic production line has been
B4 painting workshop of Axle Business Department obtained
Changxing Island manufacturing base project of Shanghai Port Machinery Manufacturing Plant
Shanghai
Zhenhua Adjustment of the Changxing Island manufacturing base project of CCCC Shanghai Port Machinery
Acceptance
Heavy Manufacturing Plant
completed
Industries Port Changxing Island manufacturing base project (extra-heavy shipping terminal and approach bridge) of
Machinery Shanghai Port Machinery Manufacturing Plant
General
Equipment EIA approval
Paint warehouse reconstruction project of Shanghai Zhenhua Heavy Industries Port Machinery General
Co., Ltd. has been
Equipment Co., Ltd.
obtained
31
Name of the
EIA approval
company or Project name
/ acceptance
subsidiary
Shanghai Port
Machinery New projects of Shanghai Port Machinery Equipment Manufacturing Co., Ltd
Acceptance
Heavy
completed
Industry Co.,
Product adjustment project of Shanghai Port Machinery Equipment Manufacturing Co., Ltd
Ltd
Annual output of 75 rail cranes, 8 bridge cranes or ship unloaders project
Annual output of 150 container yard bridges, 20,000t/a extra-heavy bridge steel structure and 10,000t/a Acceptance
Shanghai offshore heavy machinery and equipment project completed
Zhenhua 40 mu living quarter project of Nantong Zhenhua Heavy Equipment Manufacturing Co., Ltd.
Heavy
Construction
Industries Co.,
in batches;
Ltd. Nantong
Supporting project of new A-class warehouse and self-use diesel supply point of Nantong Zhenhua Heavy partial
Branch
Equipment Manufacturing Co., Ltd acceptance
has been
completed
Nantong new production base project of Nantong Zhenhua Heavy Equipment Manufacturing Co., Ltd.
Nantong Sheet pile revetment terminal of Nantong New Production Base of Nantong Zhenhua Heavy Equipment
Manufacturing Co., Ltd. Acceptance
Zhenhua completed
Heavy Nantong Zhenhua 110kV factory substation project
Equipment Supporting living quarter project of Nantong Zhenhua Heavy Equipment Manufacturing Co., Ltd.
Manufacturing
Co., Ltd. EIA approval
Expansion of 100,000t/a sand washing paint steel components to 200,000t/a and 2980t stainless steel and
has been
nonferrous metal pipe fittings project of Nantong Zhenhua Heavy Equipment Manufacturing Co., Ltd.
obtained
Gearbox factory project of Shanghai Zhenhua Port Machinery (Group) Co. Ltd (Nantong Zhenhua Heavy
ZPMC Equipment Manufacturing Co., Ltd.) Nantong Base Acceptance
Transmission New large parts processing workshop and 4 # dormitory project of ZPMC Transmission Machinery (Nantong) completed
Machinery Co., Ltd.
(Nantong) EIA approval
Co., Ltd. 5,000t/a marine pile legs and environmental protection equipment upgrading project of ZPMC Transmission
has been
Machinery (Nantong) Co., Ltd.
obtained
ZPMC Qidong
Marine Production project of products under 100,000 tons, including product tanker, chemical tanker, bulk carrier Acceptance
Engineering and marine engineering products of ZPMC Qidong Marine Engineering Co., Ltd. completed
Co., Ltd.
According to the requirements of the “Interim Provisions on the Administration of Pollutant Emission Permit” and
the “Technical Specification for Application and Issuance of Pollutant Emission Permit” of the state, the Company and its
subsidiaries have successively applied for pollutant emission permits since 2015 and applied for the change of pollutant
emission permits according to regulations, and have obtained the “Pollutant Emission Permit” issued by local ecological
and environmental protection department. In strict accordance with the requirements of emission permit, the Company
continued to discharge pollutant as permitted, carried out self-monitoring, established accounts, reported regularly and made
information public.
(4) Emergency proposal for environmental accident
√Applicable □Not applicable
In order to prevent the occurrence of sudden environmental pollution incidents and to control and deal with them quickly and
effectively after the occurrence, in accordance with the “Environmental Protection Law of the People’s Republic of China”, “Law
of the People’s Republic of China on the Prevention and Control of Water Pollution”, “Law of the People's Republic of China on
the Prevention and Control of Atmospheric Pollution”, “Law of the People's Republic of China on the Prevention and Control of
Solid Waste Pollution”, “Measures for the Administration of Recording the Emergency Plan for Emergent Environmental Events of
Enterprises and Institutions (Trial Implementation)”, “Guidelines for the Compilation of Risk Assessment Report on Environmental
Emergencies in Enterprises (Trial Implementation)”, the Company assessed the existing environmental risks, prepared the
emergency plans for subsidiaries, and filed them with the local ecological and environmental protection department. During the
reporting period, Shanghai Zhenhua Heavy Industries Co., Ltd. Changxing Branch, Shanghai Zhenhua Port Machinery Heavy
Industries Co., Ltd, and Shanghai Zhenhua Heavy Industries Co., Ltd. Nantong Branch started and completed the revision,
evaluation and filing of the emergency plan for environmental emergencies.
32
2020
(5) Self-monitoring scheme for environment
√Applicable □Not applicable
In accordance with the requirements of the emission permits and technical guidelines for self-monitoring of pollutant
discharge units, all subsidiaries have carried out regular self-monitoring of environmental protection, and released self-
monitoring information on provincial and municipal information disclosure platforms such as national pollution source
monitoring information management and sharing platform and Shanghai enterprise information disclosure platform.
During the reporting period, the Company has built five new boundary environmental monitoring stations in Changxing
base (including Shanghai Zhenhua Heavy Industries Co., Ltd. Changxing Branch, Shanghai Zhenhua Port Machinery Heavy
Industries Co., Ltd., Shanghai Zhenhua Heavy Industries Port Machinery General Equipment Co., Ltd.), which have been
equipped with advanced environmental monitoring equipment to improve the accuracy of monitoring; the Company has
changed the monitoring management mode, taken monitoring, over standard analysis, rectification, tracking and supervision
as the important functions of environmental monitoring, and realized the closed-loop management of over standard
problems. In the meanwhile, it conscientiously carried out self-monitoring and released self-monitoring data and related
information in a timely, complete and truthful manner according to national and local requirements. The self-monitoring
announcement rate in the reporting period reached 100%.
(6) Other environmental information to be disclosed
□Applicable √Not applicable
2. Particulars about the environmental protection of the companies other than those defined as key pollutant-
discharge entities
√Applicable □Not applicable
The main pollutants of the subsidiaries other than the key emission entities such as Shanghai Port Machinery Heavy
Industry Co., Ltd, subordinate to the Company: wastewater (COD, ammonia nitrogen), waste gas (particulate matter, VOCs),
solid waste, noise, etc. Discharge mode: the wastewater was discharged up to the standard after treatment and some units
have set up sewage treatment facilities; the atmospheric pollutants such as the particulate matter and VOCs in waste gas
were discharged in the manner of organized discharge; it is required to renovate spraying exhaust gas treatment facilities
and provide workshop dust removal devices, etc.; the solid wastes and the hazardous wastes were handed over to the
qualified entities for treatment; plant boundary noise was discharged up to the standard.
3. Description of the reasons for failing to disclose the environmental information by the companies other than
the key pollutant discharge entities
□Applicable √Not applicable
4. Description of the follow-up progress and changes in the contents of environmental information disclosed
during the reporting period
□Applicable √Not applicable
(IV) Other description
√Applicable □Not applicable
In August 2020, All-China Environment Federation sued the Company and Shanghai Zhenhua Heavy Industries Co.,
Ltd. Changxing Branch to Shanghai No. 3 Intermediate People’s Court for air pollution liability dispute, with the case No.
(2020) H 03 MC 274. Changxing Branch and the Company attached great importance to this event and established a special
working group to actively communicate with the Federation. So far, the Court has not arranged any trial procedures.
XVIII. Information about convertible corporate bonds
□Applicable √Not applicable
33
Section VI Changes in Ordinary Shares and Shareholders' Situation
I. Changes in ordinary shares capital
1 Table of changes in ordinary shares
1. Table of changes in ordinary shares
The total number of shares of the Company's ordinary shares and the structure of its share capital remained unchanged
during the reporting period.
2. Notes to changes in ordinary shares
□Applicable √Not applicable
3. Effect of changes in ordinary shares on financial indicators such as earnings per share and net asset per
share for the latest year and period (if any)
□Applicable √Not applicable
4. Other contents that the Company deems necessary to be disclosed or required to be disclosed by the
securities regulatory authority
□Applicable √Not applicable
2 Changes in shares with restrictive conditions for sales
□Applicable √Not applicable
II. Issuance and listing of securities
1 Securities issuance by the reporting period
□Applicable √Not applicable
Particulars about the issuance of securities during the reporting period (for bonds of different interest rates within the
duration, please state them respectively)
□Applicable √Not applicable
2 Changes in total ordinary shares of the Company and the shareholder structure, as well as the assets and liabilities
□Applicable √Not applicable
3 Existing internal employee ownership
□Applicable √Not applicable
III. Shareholders and actual controller
1 Total number of shareholders
Total of ordinary shareholders by the end of the reporting period 228,621
Total of ordinary shareholders by the end of the month previous to the disclosure date of annual report 232,566
34
2020
2 Table of the shares held by top 10 shareholders, top 10 holders of marketable shares (or shareholders without
trading limited conditions) by the end of reporting period
Unit: share
Shares held by top 10 shareholders
Number of Number of Pledge or freezing
Changes in condition
shares held at shares with Nature of
Name of shareholder(in full) the reporting Ratio (%)
the end of the trading limited Share Number shareholder
period
period conditions held status of shares
Overseas
CCCG (HK) Holding Limited 0 916,755,840 17.401 0 NA 0
legal person
China Communications Construction State-owned
0 855,542,044 16.239 0 NA 0
Company Ltd. legal person
China Communications Construction Group State-owned
0 663,223,375 12.589 0 NA 0
Co., Ltd. legal person
Central Huijin Asset Management Co., Ltd. 0 89,378,640 1.70 Unknown Unknown
Bosera Fund - Agricultural Bank of China -
Bosera China Securities Financial Assets 0 19,855,920 0.38 Unknown Unknown
Management Plan
E FUND Management- Agricultural Bank
of China - E FUND Management China 0 19,855,920 0.38 Unknown Unknown
Securities Financial Assets Management Plan
Dacheng Fund- Agricultural Bank of China
- Dacheng China Securities Financial Asset 0 19,855,920 0.38 Unknown Unknown
Management Plan
Harvest Fund - Agricultural Bank of China -
0 19,855,920 0.38 Unknown Unknown
Harvest CSI Asset Management Plan
GF Fund- Agricultural Bank of China - GF China
0 19,855,920 0.38 Unknown Unknown
Securities Financial Assets Management Plan
Lombarda China Fund- Agricultural Bank
of China - Lombarda China Fund China 0 19,855,920 0.38 Unknown Unknown
Securities Financial Assets Management Plan
China Asset Management- Agricultural Bank
of China - China Asset Management China 0 19,855,920 0.38 Unknown Unknown
Securities Financial Assets Management Plan
Yinhua Fund- Agricultural Bank of China
- Yinhua China Securities Financial Asset 0 19,855,920 0.38 Unknown Unknown
Management Plan
China Southern Asset Management-
Agricultural Bank of China - China Southern
0 19,855,920 0.38 Unknown Unknown
Asset Management China Securities Financial
Asset Management Plan
ICBC Credit Suisse Fund- Agricultural Bank of
China - ICBC Credit Suisse China Securities 0 19,855,920 0.38 Unknown Unknown
Financial Asset Management Plan
Shareholdings of top 10 shareholders without trading limited conditions
Number of non- Type and number of shares
Name of shareholder restrictive circulation
shares held Category Quantity
Foreign
CCCG (HK) Holding Limited 916,755,840 shares listed
domestically
RMB ordinary
China Communications Construction Company Ltd. 855,542,044
shares
35
Shareholdings of top 10 shareholders without trading limited conditions
Number of non- Type and number of shares
Name of shareholder restrictive circulation
shares held Category Quantity
RMB ordinary
China Communications Construction Group Co., Ltd. 663,223,375
shares
RMB ordinary
Central Huijin Asset Management Co., Ltd. 89,378,640
shares
Bosera Fund - Agricultural Bank of China - Bosera China Securities RMB ordinary
19,855,920
Financial Assets Management Plan shares
E FUND Management- Agricultural Bank of China - E FUND Management RMB ordinary
19,855,920
China Securities Financial Assets Management Plan shares
Dacheng Fund- Agricultural Bank of China - Dacheng China Securities RMB ordinary
19,855,920
Financial Asset Management Plan shares
Harvest Fund - Agricultural Bank of China - Harvest CSI Asset RMB ordinary
19,855,920
Management Plan shares
GF Fund- Agricultural Bank of China - GF China Securities Financial RMB ordinary
19,855,920
Assets Management Plan shares
Lombarda China Fund- Agricultural Bank of China - Lombarda China RMB ordinary
19,855,920
Fund China Securities Financial Assets Management Plan shares
China Asset Management- Agricultural Bank of China - China Asset RMB ordinary
19,855,920
Management China Securities Financial Assets Management Plan shares
Yinhua Fund- Agricultural Bank of China - Yinhua China Securities RMB ordinary
19,855,920
Financial Asset Management Plan shares
China Southern Asset Management- Agricultural Bank of China -
RMB ordinary
China Southern Asset Management China Securities Financial Asset 19,855,920
shares
Management Plan
ICBC Credit Suisse Fund- Agricultural Bank of China - ICBC Credit Suisse RMB ordinary
19,855,920
China Securities Financial Assets Management Plan shares
Among the above top 10 shareholders, CCCG (HK) Holding
Limited, China Communications Construction Group Co.,
Ltd. and China Communications Construction Company
Notes to the related relation or consistent actions of the above-mentioned Ltd. are related companies. It was unknown to the
shareholders Company whether there was related relation or concerted
actor specified in the Management Method on Information
Disclosure for Shareholding Change of the Shareholders of
Listed Companies.
Explanation on preferred stock holders with recovered voting rights and
number of stocks held by them
Shareholding quantity of top ten shareholders with sales restriction and the sales restriction
□Applicable √Not applicable
3 Strategic investors or legal persons becoming the top 10 shareholders due to placement of new shares
□Applicable √Not applicable
36
2020
IV. Controlling shareholders and actual controllers
1 Controlling shareholder
1. Legal person
√Applicable □Not applicable
Name China Communications Construction Group Co., Ltd.
Company principal or legal representative Wang Tongzhou
Date of Establishment December 8, 2005
Construction of overseas projects and international bidding projects at home; general
contracting for construction of various special ships, leasing and maintenance of special
ship and construction machines; offshore towage and professional services related to the
ocean engineering; technical consultant services regarding the ship and the supporting port
equipment; engaging in the general contracting of construction projects for ports, channels,
highways and bridges both home and abroad (including technical and economic consultation
Main business
of engineering, feasibility study, survey, design, construction, supervision, procurement
and supply for related complete set of equipment or materials, and equipment installation);
undertaking the general contracting of the construction of industrial and civil works, railway,
metallurgy, petrochemical, tunnel, power, mine, water conservancy, and municipal works;
import and export business; real estate development and property management; investment
and management of transportation, hotel and tourism industries.
CCCG holds 57.99% of the stock equity of CCCC (601800.SH) and it is the controlling
shareholder. CCCG holds 100% of the stock equity of CCCG Real Estate Group Co., Ltd.;
CCCG Real Estate Group Co., Ltd holds 100% of the stock equity of Zhongzhu Real Estate
Development Co., Ltd. Zhongzhu Real Estate Development Co., Ltd holds 53.32% of the
Equities of other domestic and overseas
stock equity of CCCG Real Estate Co., Ltd (name used before: Chongqing Industries,
public companies during the reporting
Zhongfang Real Estate) (000726.SZ) and it is the controlling shareholder. CCCG and its
period
controlling subsidiaries totally hold 28.91% of the stock equity of Greentown Holding Co., Ltd
(03900.HK) and are the controlling shareholders. CCCG and its subsidiaries hold 29.99% of
the stock equity of Shanghai Zhenhua Heavy Industries Co., Ltd (600320.SH) and it is the
controlling shareholder.
Notes to other circumstances
2. Natural persons
□Applicable √Not applicable
3. Particulars about no controlling shareholder in the Company
□Applicable √Not applicable
4. Index and date of change in the controlling shareholder during the reporting period
□Applicable √Not applicable
5. Chart for the property and controlling relationships between the Company and the controlling shareholders
√Applicable □Not applicable
CCCG
Shareholding ratio100% Shareholding ratio 57.99%
CCCG HK CCCC
Shareholding ratio 17.4012% Shareholding ratio 12.5888% Shareholding ratio 16.2393%
Shanghai Zhenhua Heavy Industries, Co., Ltd.
37
2 Actual controller
1. Legal person
□Applicable √Not applicable
2. Natural person
□Applicable √Not applicable
3. Particulars about no actual controller in the Company
□Applicable √Not applicable
4. Index and date of change in the actual controller during the reporting period
□Applicable √Not applicable
5. Block diagram of ownership and control relation between the Company and the actual controller
√Applicable □Not applicable
State-owned Assets Supervision and
Administration Commission of the State Council
Shareholding ratio 90%
CCCG
Shareholding ratio 100% Shareholding ratio 57.99%
CCCG HK CCCC
Shareholding ratio 17.4012% Shareholding ratio 12.5888% Shareholding ratio 16.2393%
Shanghai Zhenhua Heavy Industries, Co., Ltd.
6. Control over the Company by the actual controller via trust or other ways of assets management
□Applicable √Not applicable
3 Other information about Controlling shareholders and actual controllers
□Applicable √Not applicable
V. Other legal person shareholder holding more than 10%
□Applicable √Not applicable
VI. Particulars about restriction on reduction in shares held
□Applicable √Not applicable
Section VII Preferred Shares
□Applicable √Not applicable
38
2020
Section VIII Directors, Supervisors, Senior Executives and Employees
I. Shareholding variation and remuneration
1 Changes in shares held by current and resigned directors, supervisors and senior executives during the
reporting period and their remunerations
√Applicable □Not applicable
Unit: share
Number Number Total remuneration Remuneration
Change
of shares of shares before tax from from the
Starting Expiry in Reason
held held at the Company related
Name Post (Note) Sex Age date of date of shares of
at the the end during the party of the
tenure tenure in the change
beginning of the reporting period Company or
year
of year year (RMB’0,000) not
General
Mar. 3, June 25,
manager
2021 2021
Liu (president)
Male 52 0 0 0 0 Yes
Chengyun Director,
Mar. 19, June 25,
chairman of
2021 2021
the board
Director, vice June 26, June 25,
Liu Qizhong Male 57 0 0 0 66.69 No
president 2018 2021
Zhu June 26, June 25,
Director, CFO Male 52 0 0 0 69.09 No
Xiaohuai 2018 2021
Sheng Independent May 28, June 25,
Male 51 0 0 0 12 No
Leiming director 2019 2021
Independent May 28, June 25,
Zhang Hua Male 48 0 0 0 12 No
director 2019 2021
Independent June 26, June 25,
Yang Jun Male 64 0 0 0 12 No
director 2018 2021
Zhao Independent June 26, June 25,
Male 45 0 0 0 12 No
Zhanbo director 2018 2021
Independent June 26, June 25,
Ji Linhong Male 59 0 0 0 12 No
director 2018 2021
Independent June 26, June 25,
Bai Yunxia Female 48 0 0 0 12 No
director 2018 2021
Supervisor,
chairman of June 26, June 25,
Wang Cheng Male 48 0 0 0 69.09 No
the board of 2018 2021
supervisors
Xiang June 26, June 25,
Supervisor Male 45 0 0 0 75.17 No
Xudong 2018 2021
June 29, June 25,
You Hua Supervisor Male 58 0 0 0 0 Yes
2020 2021
Aug. 22, June 25,
Liu Jianbo Vice president Male 58 0 0 0 69.09 No
2018 2021
Aug. 22, June 25,
Zhou Qi Vice president Male 49 0 0 0 67.48 No
2018 2021
Aug. 22, June 25,
Chen Bin Vice president Male 47 107,328 107,328 0 67.38 No
2018 2021
Shan Aug. 22, June 25,
Vice president Male 57 0 0 0 67.89 No
Jianguo 2018 2021
Aug. 22, June 25,
Zhang Jian Vice president Male 52 0 0 0 69.09 No
2018 2021
Aug. 22, June 25,
Fei Guo Chief engineer Male 59 0 0 0 67.54 No
2018 2021
Chief Aug. 22, June 25,
Li Ruixiang Male 46 0 0 0 69.04 No
economist 2018 2021
39
Number Number Total remuneration Remuneration
Change
of shares of shares before tax from from the
Starting Expiry in Reason
held held at the Company related
Name Post (Note) Sex Age date of date of shares of
at the the end during the party of the
tenure tenure in the change
beginning of the reporting period Company or
year
of year year (RMB’0,000) not
Chief legal
counsel,
secretary of the Aug. 22, June 25,
Sun Li Male 49 0 0 0 66.70 No
board, chief 2018 2021
compliance
officer
Former director
June 26, Mar. 19,
Zhu Lianyu and chairman Male 51 427,200 427,200 0 86.56 No
2018 2021
of the board
Huang Former director June 26, Feb. 26,
Male 46 0 0 0 85.84 No
Qingfeng and president 2018 2021
Zhang June 26, Oct. 30,
Former director Male 61 0 0 0 0 Yes
Hongwen 2018 2020
Former
June 26, Sept. 4,
Dai Wenkai director, vice Male 54 0 0 0 53.30 No
2018 2020
president
Zhang Former June 26, June 1,
Male 59 24,311 24,311 0 83.61 No
Minghai supervisor 2018 2020
Total / / / / / 558,839 558,839 0 / 1,205.56 /
Name Main working experiences
Born in 1969, male, master, senior economist, senior engineer. He began his career in August, 1989 and has successively served as deputy
director of CCCC Fourth Harbor Engineering Co., Ltd, vice general manager of CCCC Investment Co., Ltd, secretary of the Party committee,
chairman and general manager of CCCC Nansha Investment Development Co., Ltd. and CCCC Urban Investment Holding Co., Ltd,
Liu general manager and secretary of CPC Working Committee of CCCC South China regional headquarters, general manager of the Strategic
Chengyun Development Department of China Communications Construction Company Ltd. (CCCC), general manager of the Investment Division of CCCC,
director of the board office and general manager of the Strategic Development Department of China Communications Construction Group Co.,
Ltd. (CCCG) and CCCC. Currently, he is the assistant to the general manager of CCCG, and chairman and general manager (president) of the
Company.
Liu Born in 1964, male, bachelor, senior economist. He successively served as the manager of Operating Department and the vice president of the
Qizhong Company, and serves as the director of the Company since March 2004. Currently, he is the director and vice president of the Company.
Born in 1969, male, master of MBA, senior accountant. He began his career in July 1991 and successively served as the section member and
vice section manager of Financial Division of CCCC Shanghai Dredging Co., Ltd, vice director of Budget and Finance Department, vice manager
Zhu
(in charge of the work) or manager of Finance Department, and member of commission for disciplinary inspection of CCCC Shanghai Dredging
Xiaohuai
Co., Ltd, and the director, chief accountant and Party committee standing member of CCCC Shanghai Dredging Co. Ltd. Currently, he is the
director and CFO of the Company.
Born in 1970, male, doctor of laws, senior lawyer. He successively served as a lawyer assistant and lawyer in Shanghai Foreign Trade Law
Sheng Firm, a teacher of civil and commercial law in East China University of Political Science and Law, a senior partner and chief lawyer of Shanghai
Leiming Zhongmao Law Firm, and co-chairman, senior partner and lawyer in the head office management committee of Guantao Law Firm. Currently, he
is the independent director of the Company.
Zhang Born in 1973, male, Ph.D. Economics, associate professor of finance. He successively served as a researcher, lecturer, assistant professor and
Hua associate professor at China Europe International Business School. Currently, he is the independent director of the Company.
Born in 1957, male, master degree. He successively served as intermediate and senior court judge of Shanghai Court, president and
member of the judicial committee member, Property Trade Operation Director of Shanghai United Property Rights Exchange. Now he is the
assistant president of Shanghai United Property Rights Exchange, general manager of Beijing HQ, director of Financial Property Rights Trade
Yang Jun Center, arbitrator of China International Economic and Trade Arbitration Commission, Shanghai International Economic and Trade Arbitration
Commission, arbitrator of Shanghai Arbitration Commission, Shanghai Financial Arbitration Court, expert of China domain name dispute
resolution center, director of Intellectual Property Association of China Law Society, director of Company Law Research Society of Shanghai Law
Society, director of Shanghai Patent/Trademark/Copyright Association. Currently, he is the independent director of the Company.
Born in 1976, male, Ph. D. He had served as a teacher in School of Software, Peking University since 2005 and now he is a professor. He is
Zhao
mainly engaged in the research in Internet business model innovation and corporate development strategy. Currently, he is the independent
Zhanbo
director of the Company.
Born in 1962, male, Ph. D. He successively served as the assistant and the lecturer of Department of Precision Instrument of Tsinghua
University; assistant professor of Department of Precision Engineering of Faculty of Engineering of the University of Tokyo, the Postdoctoral
Researcher in Ministry of Education, Culture, Sports, Science and Technology of Japan. He had acted as vice director of Department of
Precision Instrument of Tsinghua University, vice director of Department of Mechanical Engineering of Tsinghua University, director of Design
Ji Linhong
Engineering Research Institute of Tsinghua University, director of Experiment & Teaching Center of Mechanical Engineering, and vice director
of State Key Lab of Tribology, Tsinghua University and so on. Now he serves as a professor and a doctoral tutor in Department of Mechanical
Engineering, Tsinghua University. He is mainly engaged in digitalized design and system optimization of complicated mechanical system and the
intelligent and biological mechanical design. Currently, he is the independent director of the Company.
40
2020
Name Main working experiences
Born in October 1973, female, Ph. D from Xiamen University, post-doctor in accounting of Guanghua School of Management, Peking University,
professor of accounting, doctoral tutor, engaged in work in 1995. She successively served as the assistant engineer of Kaiyuan Group under
Bai
Xi’an Jiaotong University, lecturer of School of Economics and Management of Tongji University, research scholar of CKGSB. Now, she acts
Yunxia
as the director of Department of Accounting, School of Economics and Management, Tongji University and the research scholar of Investment
Center of CKGSB. Currently, she is the independent director of the Company.
Born in 1973, male, master of engineering, senior political worker. He successively served as the vice secretary or secretary of league
committee, and vice secretary or secretary of Party Branch of No. 2 Engineering Co., Ltd of CCCC Third Harbor Engineering Co., Ltd; vice
director and director of Organization Department of CCCC Third Harbor Engineering Co., Ltd; secretary of the Party Committee and vice general
Wang
manager of No. 2 Engineering Co., Ltd of CCCC Third Harbor Engineering Co., Ltd; chairman of board of supervisors, vice secretary of the Party
Cheng
Committee, secretary of Committee for Discipline Inspection and chairman of labor union of CCCC Third Harbor Engineering Co., Ltd. Currently,
he is the vice secretary of the Party Committee, secretary of Commission for Disciplinary Inspection, chairman of labor union and chairman of
board of supervisors of the Company.
Born in 1976, male, bachelor, senior engineer. He successively served as the designer of No.2 Design Institute of Jiangnan Shipyard (Group)
Xiang Co., Ltd, vice director and vice manager of the Quality Department of ZPMC, and general manager of ZPMC Inspection Co., Ltd. Currently, he
Xudong is the staff representative supervisor of the board of supervisors, vice general manager of ZPMC Port Machinery Group, and the secretary of the
Party committee and executive vice general manager of Changxing Branch.
Born in 1963, male, bachelor, senior accountant. He successively served as the assistant director and deputy director of Finance Department
of China Harbour Engineering Company Limited, and finance manager of CHUWA Bussan Company Limited (Japan); general manager of the
Finance Department and director of Capital Settlement Center, deputy chief accountant and general manager of Finance Department of China
You Hua Harbour Engineering Company(Group); general manager of Capital Department and director of Capital Settlement Center of CCCG; director
and chief accountant of China Harbour Engineering Company Limited; director, vice general manager and chief accountant of CCCC Investment
Co., Ltd; director, general manager and deputy Secretary of Party Committee of CCCC Finance Co., Ltd. Since December 2019, he has been a
full-time outside director of CCCG. He is now a supervisor of the Company.
Born in 1963, male, bachelor, senior engineer. He successively served as the engineer at technological office of Shanghai Port Machinery Plant;
assistant director in engineering technology department of Shanghai Container Dock Co. Ltd., project director of ship operation department and
Liu Jianbo
chief engineer of engineering department of Shanghai ZPMC, and vice general manager of and general manager of ZPMC Changxing Base.
Currently, he is the vice president of the Company.
Born in 1972, male, EMBA, professor-level senior engineer. He successively served as the technician, manager, deputy chief engineer, general
Zhou Qi
manager of the Electric Appliance Office and chief engineer of the Company. Currently, he is the vice president of the Company.
Born in 1974, male, EMBA, senior engineer. He successively served as the project quality leader of Quality Control Division, vice manager of
tire crane office of quality control division, manager of quality control division, vice general manager and general manager of quality inspection
Chen Bin
company, vice director and vice chief engineer of quality safety office, manager of quality safety division, supervisor and president assistant of
the Company. Currently, he is the vice president and safety director of the Company.
Born in 1964, male, bachelor, senior engineer. He successively served as the technician in Shanghai Port Machinery Manufacturing Plant, the
Shan engineer and chief engineer of ZPMC Machinery Office, general manager and vice chief engineer of No.4 design office of design company, vice
Jianguo director and director of ZPMC Machinery Office, manager of budget assessment department and the dean of ZPMC Land-based Heavy Industry
Research & Design Institute. Currently, he is the vice president of the Company.
Born in 1969, male, MBA, senior engineer. He successively served as the technician, production planner and assistant director of No. 2
Panel beater of Shanghai Port Machinery Manufacturing Plant, director of gearbox branch of Shanghai Port Machinery Manufacturing Plant,
Zhang
vice director and member of the Party committee of Shanghai Port Machinery Manufacturing Plant, vice general manager of Shanghai Port
Jian
Machinery Heavy Industry Co., Ltd, general manager and president assistant of ZPMC Operation Office. Currently, he is the vice president of the
Company.
Born in 1962, male, EMBA, professor-level senior engineer. He successively served as the engineer of Shanghai Port Machinery Plant, electrical
Fei Guo engineer of the Technology Department, director of No. 5 Electrical Office, vice chief engineer, chief engineer, director of Development Office
and vice president of ZPMC. Currently, he is the chief engineer of the Company.
Born in 1975, male, bachelor, senior economist. He successively served as the director of Technical Process Department, trainee manager
of Manufacturing Department and manager of Quality Assurance Department of Zhangjiagang Base of Shanghai Port Machinery Plant;
Li project leader, office manager, vice director of Quality Safety Office, vice general manager and general manager of mechanical supporting
Ruixiang base, secretary of Party Branch, vice chief economist, general manager of budget assessment department, general manager of Material and
Equipment Procurement Department and president assistant of ZPMC quality inspection company. Currently, he is the chief economist of the
Company.
Born in 1972, male, EMBA, senior engineer. He successively served as the project leader and vice manager of Operation Department, vice
Sun Li director of Operation Office and director of Off-Shore Office, general manager assistant, vice president and director of the Company. Currently,
he is the chief legal counsel, secretary of the board and chief compliance officer of the Company.
Born in 1970, male, Ph.D., professor-level senior engineer. He began his career in September 1992 and successively served as the engineer,
equipment leader of overseas projects, vice chief of Marine Machine Department, manager of Enterprise Development Department of CCCC
Zhu
First Harbor Engineering Co., Ltd; the general manager of CCCC International Shipping Co., Ltd and the vice general manager of the Equipment
Lianyu
Manufacturing Marine Heavy Industry Department of China Communications Construction Co., Ltd. He resigned as director and chairman of the
board of the Company on March 19, 2021.
Born in 1975, male, EMBA, senior engineer. He began his career in July 1996 and successively served as the chief of Quality Inspection
Department, vice director of Quality Inspection No.2 Department, vice general manager of quality inspection company, vice general manager of
Huang
after-sales service department, general manager of quality inspection company; vice director of Off-Shore Office, vice director and director of
Qingfeng
Quality Safety Office, director of Product Service Center, president assistant, vice president and president of the Company. He resigned as the
director and president of the Company on Feb. 26, 2021.
41
Name Main working experiences
Born in 1960, male, bachelor, senior engineer; engaged in work in August 1983. He successively served as the vice general manager of CHEC
International Engineering Branch, vice general manager of Overseas Division and manager of Integrated Department of CHEC Group, vice
general manager of Engineering Management Department and Operation & Management Department of China Communications Construction
Zhang
Co., Ltd, vice general manager and general manager of Capital Construction Department (Dredging Department) and the executive general
Hongwen
manager and general manager of Port Dredging Business Department of CCCC, as well as the director, executive general manager, temporary
member of the Party committee and non-executive director of CCCC Dredging (Group) Co., Ltd. He resigned as the director of the Company on
Oct. 30, 2020.
Born in 1967, male, master of physics, EMBA, senior engineer. He began his career in March 1993 and successively served as the director of
Dai
Operation Management Office and vice president of the Company. He resigned as the director and vice president of the Company on Sept. 4,
Wenkai
2020.
Born in 1962, male, bachelor, professor-level senior engineer. He successively served as the engineer of Technology Division of Shanghai Port
Zhang Machinery Plant; mechanical office designer, vice manager and vice chief engineer of Shanghai Zhenhua Heavy Industries Co., Ltd., general
Minghai manager of Shore Bridge No.1 Company of Mechanical Office, and general manager of Land-based Heavy Industry Co., Ltd. He resigned as the
supervisor of the Company on June 1, 2020 and is now serving as the chief designer of the Company.
Notes to other circumstances
□Applicable √Not applicable
2 Equity incentives awarded to the directors and senior executives during the reporting period
□Applicable √Not applicable
II. Incumbency of current and resigned directors, supervisors and senior executives during the reporting period
1 Position at the shareholder entity
√Applicable □Not applicable
Name of in- Starting date of Expiration date
Name of shareholding entity Position
service staff tenure of tenure
China Communications Construction
Liu Chengyun General manager assistant March 5, 2021
Group Co., Ltd.
Statement of the position held in shareholding entity
2 Statement of the position held in other entities
√Applicable □Not applicable
Starting Expiration
Name of in- Position held in other
Name of other entities date of date of
service staff entities
tenure tenure
Zhao Zhanbo School of Software, Peking University Professor
Professor and doctoral
Ji Linhong Department of Mechanical Engineering, Tsinghua University
supervisor
Shanghai United Assets and Equity Exchange, Financial Assets
Exchange, Shanghai International Economic and Trade Arbitration
Assistant president,
Commission, Shanghai Arbitration Commission, Shanghai Court of
general manager,
Yang Jun Financial Arbitration, Chinese Domain Name Dispute Settlement
director, arbitrator,
Center, Intellectual Property Association of China Law Society,
expert, director
Company Law Association of Shanghai Law Society, Shanghai Patent/
Trademark/Copyright Association.
Director of Accounting
School of Economics and Management of Tongji University, Investment
Bai Yunxia Department, research
Centre of Cheung Kong Graduate School of Business
scholar
Researcher, lecturer,
Zhang Hua China Europe International Business School assistant professor and
associate professor
Sheng Shanghai Foreign Trade Law Firm, East China University of Political Senior partner, lawyer,
Leiming Science and Law, Shanghai Zhongmao Law Firm, Guantao Law Firm. teacher, etc.
Statement of the position held in other entities
42
2020
III. Remuneration of directors, supervisors and senior executives
√Applicable □Not applicable
In accordance with the regulations of Articles of Association, the
Decision-making process for the remuneration of directors, remuneration of directors and supervisors are subject to the general
supervisors and senior executives meeting of shareholders and the remuneration of the senior executives
are assessed and approved by the chairman and president.
Basis for deciding the remuneration of remuneration of directors, The basic salary plus performance bonus are assessed in combination
supervisors and senior executives with the quantitative index of production and operation, etc.
Actual payout of remuneration for directors, supervisors and All in-service and resigned director, supervisor and senior executives
senior executives are paid by the Company within the reporting period.
Total remuneration actually obtained by all directors, supervisors
RMB 12,055,600.00
and senior executives at the end of reporting period
IV. Change in directors, supervisors and senior executives
√Applicable □Not applicable
Name Post Change Reason of change
Liu Chengyun Director, chairman of the board, general manager (president) Elected Job adjustment
Zhu Lianyu Director, chairman of the board Resigned Job adjustment
Huang Qingfeng Director, president Resigned Job adjustment
Zhang Hongwen Director Resigned Age reason
Dai Wenkai Director, vice president Resigned Individual reason
Zhang Minghai Supervisor Resigned Job adjustment
V. Punishments by securities regulatory authority in recent three years
□Applicable √Not applicable
VI. Particulars about the employees in the parent company and the main subsidiaries
1 Particulars about employees
Number of in-service employees of the parent company 3,109
Number of in-service employees of the main subsidiaries 5,593
Total of in-service employees 8,702
Number of retired employees required to be paid by the parent company and its major subsidiaries
Specialties
Category Number of staff
Production staff 3,258
Sales staff 277
Technical staff 4,247
Financial staff 163
Administrative staff 757
Total 8,702
Education background
Education level Number (person)
Doctor 18
Master 707
Undergraduate 4,220
Junior College 2,001
Technical secondary school 567
High school and below 1,189
Total 8,702
43
2 Remuneration policies
√Applicable □Not applicable
In line with the Company’s development strategy, it continuously perfected the remuneration distribution incentive
system, perfected the performance assessment system and established and improved the performance assessment system
based on the different properties and characteristics of each entity and division; promoted the salary incentive system closely
linking the performance distribution with the unit or division performance, value contribution, industrial characteristics, growth
phase and similar factors, and comprehensively linking the staff performance with position duty and value contribution, and
thus initially established the distribution mode integrating with the market.
3 Training plan
√Applicable □Not applicable
In line with the Company’s development strategy, the Company gradually established a rigid staff training system with
systematic, directional and continuous features. The Company sets up the all-staff annual educational and training plan
at the beginning of each year and implements it according to the plan to improve the business skill level and professional
quality of staff at various levels.
4 Labor outsourcing
√Applicable □Not applicable
Total of labor outsourcing hours 7,310,088 hours
Total of labor outsourcing remuneration RMB 392,856,400.00
VII. Others
□Applicable √Not applicable
44
2020
Section IX Corporate Governance
I.Related information about corporate governance
√Applicable □Not applicable
During the reporting period, the Company strictly followed the regulations specified in the Company law, Securities
Law, Stock Listing Rules, Articles of Association and the legal requirements of China Securities Regulatory Commission
to standardize the Company’s daily operation, further established and improved the internal control system, improved
the internal control management and corporate governance structure, strengthened the insider information management,
strengthened the information disclosure, continuously improved the company governance, made efforts to improve the
construction of legal person governance structure, and gradually established a modern enterprise system, earnestly
protected the legal rights and interests of the Company and all the shareholders, ensuring the sustainable and stable
development.
After self-inspection, the staffs who know the insider information didn’t trade the stocks of the Company before major
price information is disclosed. There is no difference between the company governance and the regulations of China
Securities Regulatory Commission.
Whether there is important difference between corporate governance and the requirements of relevant regulations of
China Securities Regulatory Commission; if any, please give the reason.
□Applicable √Not applicable
II. Brief introduction to the general meeting of shareholders
Query index of the website specified for Date of disclosure for
Session of meeting Convening date
publishing resolutions publishing resolutions
General Meeting of Shareholders www.sse.com.cn, enter the stock code to
June 29, 2020 June 30, 2020
in 2019 search
Particulars about the general meeting of shareholders
□Applicable √Not applicable
III. Duty performance of directors
1 Attendance of the directors at the board meetings and the general meeting of shareholders
Attendance
at the general
Attendance at Board Meetings
meeting of
Independent shareholders
Director
director or Times of Personal Times of
Name Times of
not meetings Times of Times of absence attendance in
attendance Times of
should be personal attendance by for two the general
through a absence
attended in attendance telecommunication consecutive meeting of
proxy
this year times shareholder
Zhu Lianyu No 5 5 5 0 0 No 1
Huang
No 5 5 5 0 0 No 1
Qingfeng
Zhang
No 4 4 4 0 0 No 0
Hongwen
Liu Qizhong No 5 5 5 0 0 No 1
Dai Wenkai No 4 4 4 0 0 No 1
Zhu Xiaohuai No 5 5 5 0 0 No 1
Sheng
Yes 5 5 5 0 0 No 1
Leiming
Zhang Hua Yes 5 5 5 0 0 No 1
Yang Jun Yes 5 5 5 0 0 No 1
Zhao Zhanbo Yes 5 5 5 0 0 No 0
45
Attendance
at the general
Attendance at Board Meetings
meeting of
Independent shareholders
Director
director or Times of Personal Times of
Name Times of
not meetings Times of Times of absence attendance in
attendance Times of
should be personal attendance by for two the general
through a absence
attended in attendance telecommunication consecutive meeting of
proxy
this year times shareholder
Ji Linhong Yes 5 5 5 0 0 No 0
Bai Yunxia Yes 5 5 5 0 0 No 0
Explanations for personal absence from the meeting for two consecutive times
□Applicable √Not applicable
Times of the board meetings convened in current year 5
Including: times of on-site meetings 0
Times of meetings convened through telecommunication 5
Times of meetings convened on-site and through telecommunication 0
2 Objections from independent directors against related issues of the Company
□Applicable √Not applicable
3 Others
□Applicable √Not applicable
IV. As for the important suggestions and advices raised by the special interest committees under the Board of
Directors while performing their duties in the reporting period, where there is any objection, the details shall be
disclosed
□Applicable √Not applicable
V. Description of the risks found by the board of supervisors
□Applicable √Not applicable
VI. Particulars about the inability of the Company and its controlling shareholders to guarantee the independence
and keep independent operation capacity with regard to business, personnel, assets, institution, finance, etc.
□Applicable √Not applicable
Where there is horizontal competition, the corresponding solutions, job schedule and follow-up wok plan of the Company
□Applicable √Not applicable
VII. Establishment and implementation of the assessment mechanism and incentive mechanism for senior
executives during the reporting period
√Applicable □Not applicable
The Company appoints the directors, supervisors and senior executives in accordance with the provisions of Company
Law and the Articles of Association, has built up a preliminary cultivation, selection, supervision, assessment, reward
and punishment, constraint system for the Company’s senior executives suitable for the actual situation. The Company
formulated corresponding administrative methods for senior executives. According to the production and development need
of the Company, the senior executives are appointed, resigned and assessed following the principles of “being from top to
bottom integrating the virtue and talent”, and are subject to annual appraisal by the Company according to the due diligence
and job performance. The Company will gradually improve the existing performance evaluation system and salary system,
and promote medium and long term incentive system for all senior executives and the core technical personnel of the
Company, to continue to stimulate the enthusiasm of the senior executives, to create new achievements, and to ensure the
benefit maximization and standard operation of the Company.
46
2020
VIII. Disclosure of self-evaluation report on internal control or not
√Applicable □Not applicable
Ernst & Young LLP (special general partnership), engaged by the Company, had audited the effectiveness of the internal
control of the financial statement as of December 31, 2020 and issued a standard internal control audit report with clean
opinion (see the attachment to the announcement for details).
Description of the important deficiencies in internal control during the reporting period
□Applicable √Not applicable
IX. Particulars about the audit report on internal control
√Applicable □Not applicable
Ernst & Young LLP (special general partnership), engaged by the Company, had audited the effectiveness of the internal
control of the financial statement as of December 31, 2020 and issued a standard internal control audit report with clean
opinion (see the attachment to the announcement for details).
Audit report on internal control disclosed or not: Yes
Opinion type of internal control audit report: standard with clean opinion
X.Others
□Applicable √Not applicable
Section X Related Information on Corporate Bonds
□Applicable √Not applicable
47
Section XI Financial Report
I. Auditors’ Report
√Applicable □Not applicable
Auditors' Report
Ernst & Young (2021) SZ No.61249778_B01
Shanghai Zhenhua Heavy Industries Co., Ltd.
All shareholders of Shanghai Zhenhua Heavy Industries Co., Ltd.:
1 Opinion
We have audited the financial statements of Shanghai Zhenhua Heavy Industries Co., Ltd. (hereinafter referred to as
the "Company"), which comprise the consolidated balance sheet and the Company's balance sheet as at December 31,
2020, the consolidated income statement and the Company's income statement, the consolidated statement of changes in
shareholders’ equity and the Company's statement of changes in owners’ equity and the consolidated statement of cash
flows and the Company's statement of cash flows for the year then ended as well as the notes to the financial statements.
In our opinion, the financial statements of the Company attached are prepared, in all material respects, in accordance
with the Accounting Standards for Business Enterprises, and fairly present the consolidated financial position and the
Company's financial position as at December 31, 2020 and the consolidated operating results and cash flows and the
Company's operating results and cash flows for the year then ended.
2 Basis for Our Opinions
We conducted our audit in accordance with Chinese Certified Public Accountants Auditing Standards. Our
responsibilities under those standards are further described in the Auditors' Responsibilities for the Audit of the Financial
Statements section of this auditors' report. According to the Code of Ethics for Certified Public Accountants of China, we are
independent of the Company, and we have fulfilled other responsibilities in the aspect of code of ethics. We believe that the
audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
3 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 for the current period. The response to these matters is based on the overall audit of the financial
statements and the formation of audit opinions. We do not express our opinions on these matters separately. The following
description of how our audit addressed the key audit matter is also against this background.
We have fulfilled the responsibilities stated in “Responsibilities of Certified Public Accountant for Auditing of Financial
Statement” in this report, including the responsibilities related to these key auditing matters. Correspondingly, our auditing
work includes the implementation of the auditing procedure designed for dealing with the great misstatement risks of the
financial statement to be evaluated. The results from the implementation of the auditing procedure by us, including the
procedure to be implemented for the following key auditing matters, offers a foundation for releasing the auditing opinions of
the financial statements.
48
2020
Key Audit Matters: How our audit addressed the key audit matter:
1. Inventory depreciation reserves
Shanghai Zhenhua Heavy Industries Co., Ltd. is mainly engaged in
manufacturing the port container crane; in addition, it is also engaged in the
Our procedure mainly included knowing and testing
manufacture of bulk handling machine, offshore heavy-duty machine and large-
the validity of the control related to the provision of
sized steel structure. Its inventories mainly include engineering raw materials,
inventory depreciation reserves and the method of
outsourcing parts and components, products in the process and inventory
calculating the net realizable value of the Group. We
goods. Since the production cycle of the products is relatively long, the net
also implemented the related auditing procedures over
realizable value of the related inventory may fluctuate with the change in the
the inventory such as supervision of inventory to verify
market demand, resulting in the inventory depreciation risks. The management
whether the management had marked the inventory
sets aside the inventory depreciation reserves according to the balance of
with slow turnover and defectives and taken into full
the inventory cost and the net realizable value. The net realizable value is
account in provision of inventory depreciation reserves.
determined as per the estimated selling price of the inventory minus the cost,
In addition, we obtained the computation sheet of
the estimated selling expenses and the related taxes that may occur in the
provision of inventory depreciation reserves from the
completion on the assumption that the management layer adopts a certain
management, rechecked the calculation method and
estimate and hypothesis in determining the net realizable value. In case of
result. As to the key elements taken into consideration
difference between the actual figure and the originally estimated figure, the
by the management in calculating the net realizable
related balance will affect the book value of the inventory and the depreciation
value, including the estimated selling price and the
loss in the estimated fluctuation.
cost that may occur till completion, we evaluated the
As of December 31, 2020, in the consolidated financial statements, the balance
hypothesis and the estimates through analyzing the
of inventories was RMB 23.32 billion and the reserve for inventory depreciation
related historical data and comparing the after-date
was RMB 990 million; in the financial statements of the Company, the balance
data of Shanghai Zhenhua Heavy Industries Co.,
of inventories was RMB 19.95 billion and the reserve for inventory depreciation
Ltd. We also rechecked the disclosure of inventory
was RMB 1 billion.
depreciation reserves in financial statements.
The accounting policy and other disclosures regarding the inventory are stated
in Note V (15), Note V (43) and Note VII (9) of the financial statement.
2.Provision for bad debts of accounts receivable
The accounts receivable of Shanghai Zhenhua Heavy Industries Co., Ltd. is
mainly from the business contract on port machine and ocean engineering Our procedure mainly included the evaluation of
manufacturing. Since it involves large contracted value, long construction the accounting estimate relating to the depreciation
period, relatively complicated technical parameters, the implementation of the reserves, such as the financial status and credit
contract may be affected by the periodicity of the economic environment. The rating of the counterpart; checked the account age
accounts receivable has certain risk in the recovery in case of any dispute of accounts receivable and historical repayment
in contract or the industry is in recession. The provisions for bad debts of record and evaluated whether the financial problems
accounts receivable are recognized on the basis of estimated credit losses, of the counter party had effects on the recovery of
involving major judgment and estimates. The management of analyzed the accounts receivable; for the accounts receivable
the financial position of counter parties, guarantee acquired for accounts evaluated based on the portfolio, we rechecked the
receivable, historical repayment records of accounts receivable, as well as the management's setting of credit risk features portfolio,
credit rating and future economic situations of counter parties for evaluating the checked the key information such as account age
credit risk of accounts receivable. and credit record of each portfolio by sampling, and
As of December 31, 2020, in the consolidated financial statements, the balance rechecked the basis of management's evaluation of
of accounts receivable was RMB 9.10 billion and the provision for bad debts credit risk and expected credit loss amount based
of accounts receivable was RMB 1.87 billion; in the financial statements of the on the credit risk features portfolio, including testing
Company, the balance of accounts receivable was RMB 17.14 billion and the historical default data and checking the actual credit
provision for bad debts of accounts receivable was RMB 1.80 billion. loss in the current year; rechecked the disclosure of
The accounting policy and other disclosures regarding the provision for bad bad debt provision for accounts receivable in financial
debts of accounts receivable are stated in Note V (12), Note V (43), Note VII (5) statements.
and Note XVII (1) of the financial statements.
49
Key Audit Matters: How our audit addressed the key audit matter:
3. Revenue recognition
Our procedure mainly included evaluating and testing
the management's internal control related to revenue
recognition. Selected the sales contract with significant
amount, checked the important contract terms related
Most of the revenue of Shanghai Zhenhua Heavy Industries Co., Ltd. comes to revenue recognition according to the five step
from the one of the construction contracts on the large-sized port equipment, requirements of the new revenue standard, and
heavy equipment, steel structure and construction projects customized by the evaluated the management’s accounting judgment
customer. and estimate on performance obligations, revenue
Since January 1, 2020, the new revenue standard has been applied, and the recognition amount (including variable consideration)
management has read and analyzed the contracts of various revenue types and the recognition at a certain time point or within
according to the requirements of five step method. The performance obligations a period of time. Through selecting the samples, we
included in the manufacturing contract on large-sized port equipment, heavy verified whether the contract revenue recognized in the
equipment and some steel structure products did not meet the conditions of year conformed to the revenue recognition conditions;
performance obligations within a certain period of time, therefore, based on implemented the cutoff check procedure to validate
comprehensive consideration of various factors, the revenue was recognized the revenue was confirmed in the proper accounting
at the time of control transfer of relevant products. period. For the revenue recognized in a certain period
In 2020, in the consolidated financial statements, the operating revenue was of time, we evaluated the judgment and estimate of the
RMB 22.66 billion; in the financial statements of the Company, the operating total contract cost and total processing amount made
revenue was RMB 21.79 billion. by the management, and made sampling to calculate
The accounting policy and other disclosures regarding the operating revenue and check the income determined by the occurred
are stated in Note V (38), Note V (43), Note V (44), Note VII (74) and Note XVII contract cost and the expected total contract cost
(4) of the financial statements. again; implemented the analysis procedure against
the changes in revenue and gross profit of various
businesses; rechecked the disclosure of revenue
recognition in financial statements.
4 Other Information
The management of Shanghai Zhenhua Heavy Industries Co., Ltd. shall be responsible for other information. The other
information comprises information of the annual report, but excludes the financial statements and our auditors' report.
Our opinion on the financial statements does not cover the other information, and we do not and will not express any
form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information identified
above 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 work we have performed on the other information that we obtained prior to the date of this auditors'
report, we conclude that there is a material misstatement of this other information, we are required to report that fact. In this
regard, we have nothing to report.
5 Responsibilities of the Management and Those Charged with Governance for the Financial Statements
The Management is responsible for preparing the financial statements in accordance with the requirements of
Accounting Standards for Business Enterprises to achieve a fair presentation, and for designing, implementing and
maintaining internal control that is necessary to ensure that the financial statements are free from material misstatements,
whether due to frauds or errors.
In preparing the financial statements, the Management is responsible for assessing the Company’s going-concern
ability, disclosing the matters related to going concern (if applicable) and using the going-concern assumption, unless the
Management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company's financial reporting process.
6 Auditors' Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditors' report that includes our opinion. Reasonable
assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the audit standards
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 reasonably be expected to influence the economic decisions of users
taken on the basis of these financial statements.
50
2020
During the process of an audit conducted in accordance with audit standards, we exercise professional judgment and
maintain professional scepticism throughout the audit. Meanwhile, we also implement the following work:
(1)Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error,
design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate
to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for
one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of
internal control.
(2)Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances.
(3)Evaluate the appropriateness of accounting policies used by and the reasonableness of accounting estimates and
related disclosures made by the management.
(4)Conclude on the appropriateness of the Management's use of the going concern basis of accounting. Based on
the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant
doubt on the ability of Shanghai Zhenhua Heavy Industries Co., Ltd. to continue as a going concern. If we conclude that a
material uncertainty exists, we are required to, in our auditors' report, draw attention of the users of statements to the related
disclosures in the financial statements; if such disclosures are inadequate, we should modify our opinion. Our conclusions
are based on the audit evidence obtained up to the date of our auditors' report. However, future events or conditions may
cause Shanghai Zhenhua Heavy Industries Co., Ltd. to cease to continue as a going concern.
(5)Evaluate the overall presentation, structure and content (including the disclosures) of the financial statements, and
evaluate whether the financial statements represent the underlying transactions and events in a manner that achieves fair
presentation.
(6)Obtain 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 are responsible for the direction, supervision and
performance of the group audit, and bear full responsibility for our audit opinion.
We communicate with those charged with governance regarding the planned scope and timing of the audit, significant
audit findings and other matters, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them in regard to all relationships and other matters that
may reasonably be thought to affect our independence, and related safeguards (if applicable).
From the matters communicated with those charged with governance, we determine those matters that were of most
significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe
these matters in our auditors' report unless law or regulation precludes public disclosure about the matter or when, in
extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse
consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Ernst & Young LLP. Certified Public Accountant of China: Liu Wei
(Special General Partnership) (Engagement Partner)
Certified Public Accountant of China:Gu Chengli
Beijing, China March 30, 2021
51
II. Financial Report
Consolidated Balance Sheet
As at December 31, 2020
Prepared by: Shanghai Zhenhua Heavy Industries Co., Ltd. Unity: Yuan Currency: CNY
Item Note As at December 31, 2020 As at December 31, 2019
Current assets:
Monetary funds VII (1) 2,948,074,736 3,310,297,451
Settlement provisions -
Lending funds -
Held-for-trading financial assets VII (2) 1,601,623,650 1,739,792,062
Derivative financial assets -
Notes receivable VII (4) 753,000 5,650,000
Accounts receivable VII (5) 7,227,065,255 4,966,175,528
Receivables financing VII (6) 362,006,319 406,408,604
Advances to suppliers VII (7) 767,426,147 935,878,777
Premiums receivable -
Reinsurance accounts receivable -
Reserves for reinsurance contract receivable -
Other receivables VII (8) 913,410,163 1,176,561,508
Including: Interest receivable -
Dividend receivable 1,072,390
Financial assets purchased under agreements to resell -
Inventories VII (9) 22,325,839,116 8,561,251,580
Contract assets VII (10) 2,063,296,890 -
Outstanding payments for construction completed 12,434,158,624
Assets held for sale -
Non-current assets due within one year VII (12) 1,884,370,444 1,313,203,581
Other current assets VII (13) 708,484,102 720,183,574
Total current assets 40,802,349,822 35,569,561,289
Non-current assets:
Disbursement of loans and advances
Debt investment
Other debt investments
Long-term receivables VII (16) 5,077,114,342 5,227,728,420
Long-term equity investments VII (17) 3,042,232,884 2,873,673,745
Other equity instrument investment VII (18) 61,505,751 61,981,268
Other non-current financial assets VII (19) 330,094,057 -
Investment properties VII (20) 467,607,519 418,425,533
Fixed assets VII (21) 19,820,601,397 21,454,967,299
Construction in progress VII (22) 4,520,147,819 4,380,489,888
Productive biological assets -
Oil and gas assets -
Right-of-use assets -
Intangible assets VII (26) 3,347,450,714 3,506,541,366
Development expenditures -
Goodwill VII (28) 261,072,463 268,434,934
Long-term deferred expenses VII (29) 502,811 1,444,636
52
2020
Consolidated Balance Sheet(Continued)
As at December 31, 2020
Prepared by: Shanghai Zhenhua Heavy Industries Co., Ltd. Unity: Yuan Currency: CNY
Item Note As at December 31, 2020 As at December 31, 2019
Deferred income tax assets VII (30) 752,960,672 486,197,635
Other non-current assets VII (31) 837,004,289 161,337,287
Total non-current assets 38,518,294,718 38,841,222,011
Total assets 79,320,644,540 74,410,783,300
Current liabilities:
Short-term borrowings VII (32) 17,795,076,565 22,001,319,380
Borrowings from the Central Bank -
Borrowing funds -
Held-for-trading financial liabilities VII (33) 458,882 7,312,741
Derivative financial liabilities -
Notes payable VII (35) 3,600,725,892 3,420,945,451
Accounts payable VII (36) 7,773,903,147 7,869,378,365
Advances from customers VII (37) 4,893,675 822,987,986
Contract liabilities VII (38) 11,195,309,083
Financial assets sold for repurchase -
Deposits from customers and interbank -
Acting trading securities -
Acting underwriting securities -
Amount settled for uncompleted work 1,679,950,879
Payroll payable VII (39) 188,799,969 329,978,281
Tax payable VII (40) 160,782,931 144,506,742
Other payables VII (41) 481,065,700 711,389,996
Including: Interest payable -
Dividends payable 352,598 31,701,965
Fees and commissions payable -
Dividend payable for reinsurance
Liabilities held for sale
Non-current liabilities due within a year VII (43) 1,374,465,319 7,287,484,513
Other current liabilities -
Total current liabilities 42,575,481,163 44,275,254,334
Non-current liabilities:
Reserve fund for insurance contracts -
Long-term borrowings VII (45) 16,850,299,742 8,413,339,986
Bonds payable -
Including: preferred stock -
Perpetual bond -
Lease liabilities -
Long-term payables VII (48) 1,632,757,932 1,741,945,636
Long-term payroll payable -
Estimated liabilities VII (50) 261,072,318 484,000,772
Deferred income VII (51) 388,756,001 458,722,579
Deferred income tax liabilities 106,666,671 89,856,727
53
Consolidated Balance Sheet(Continued)
As at December 31, 2020
Prepared by: Shanghai Zhenhua Heavy Industries Co., Ltd. Unity: Yuan Currency: CNY
Item Note As at December 31, 2020 As at December 31, 2019
Other non-current liabilities VII (52) 430,372,502 376,626,821
Total non-current liabilities 19,669,925,166 11,564,492,521
Total liabilities 62,245,406,329 55,839,746,855
Owners’ equity (or shareholders’ equity):
Paid-in capital (or share capital) VII (53) 5,268,353,501 5,268,353,501
Other equity instruments VII (54) 500,000,000 -
Including: preferred stock -
Perpetual bond 500,000,000 -
Capital reserves VII (55) 4,834,854,332 4,834,854,332
Less: treasury stock -
Other comprehensive income VII (57) -62,927,398 23,530,451
Special reserves VII (58) 1,936,153 3,615,638
Surplus reserves VII (59) 1,651,418,547 1,761,198,709
General risk preparation -
Undistributed profits VII (60) 2,377,187,005 3,651,851,383
Total owners' equities attributable to the owners of parent
14,570,822,140 15,543,404,014
company
Minority equity 2,504,416,071 3,027,632,431
Total owners’ equity (or shareholders' equity) 17,075,238,211 18,571,036,445
Total liabilities and owners’ equity (or shareholders' equity) 79,320,644,540 74,410,783,300
Legal Representative: Person in charge of Person in charge of
accounting work: accounting agency:
54
2020
Balance Sheet of the Parent Company
As at December 31, 2020
Prepared by: Shanghai Zhenhua Heavy Industries Co., Ltd. Unity: Yuan Currency: CNY
Item Note As at December 31, 2020 As at December 31, 2019
Current assets:
Monetary funds 1,902,199,066 2,009,711,462
Held-for-trading financial assets 907,154,115 717,766,887
Derivative financial assets
Notes receivable 753,000 5,650,000
Accounts receivable XVII (1) 15,333,326,224 11,188,977,446
Receivables financing 306,365,354 372,373,708
Advances to suppliers 4,628,860,061 2,516,366,730
Other receivables XVII (2) 5,505,896,413 7,850,320,715
Including: Interest receivable -
Dividend receivable -
Inventories 18,950,680,070 8,605,357,557
Contract assets 1,133,865,802
Outstanding payments for construction completed 7,399,709,689
Assets held for sale
Non-current assets due within one year 16,068,800 16,068,800
Other current assets 320,289,945 242,069,645
Total current assets 49,005,458,850 40,924,372,639
Non-current assets:
Debt investment
Other debt investments
Long-term receivables 274,746,933 349,516,318
Long-term equity investments XVII (3) 8,725,608,053 8,748,485,729
Other equity instrument investment 61,505,751 61,981,268
Other non-current financial assets 330,094,057 -
Investment properties 467,607,519 418,425,533
Fixed assets 4,016,049,591 4,484,852,694
Construction in progress 659,009,550 352,334,608
Productive biological assets
Oil and gas assets
Right-of-use assets
Intangible assets 1,507,604,347 1,537,053,308
Development expenditures
Goodwill
Long-term deferred expenses
Deferred income tax assets 717,095,880 461,638,248
Other non-current assets 533,182,276 -
Total non-current assets 17,292,503,957 16,414,287,706
Total assets 66,297,962,807 57,338,660,345
Current liabilities:
Short-term borrowings 14,351,318,050 16,511,846,099
Held-for-trading financial liabilities
Derivative financial liabilities
Notes payable 3,897,225,892 4,115,677,123
55
Balance Sheet of the Parent Company(Continued)
As at December 31, 2020
Prepared by: Shanghai Zhenhua Heavy Industries Co., Ltd. Unity: Yuan Currency: CNY
Item Note As at December 31, 2020 As at December 31, 2019
Accounts payable 5,364,410,446 4,097,874,390
Advances from customers 490,409,652
Contract liabilities 10,446,873,026
Amount settled for uncompleted work 2,053,025,876
Payroll payable 173,661,671 312,443,598
Tax payable 26,049,457 24,536,759
Other payables 1,083,925,556 1,223,412,212
Including: Interest payable -
Dividends payable 352,598 352,598
Liabilities held for sale -
Non-current liabilities due within one year 709,198,148 5,454,698,322
Other current liabilities
Total current liabilities 36,052,662,246 34,283,924,031
Non-current liabilities:
Long-term borrowings 14,777,075,334 6,446,433,319
Bonds payable -
Including: preferred stock -
Perpetual bond -
Lease liabilities -
Long-term payables -
Long-term payroll payable -
Estimated liabilities 253,696,912 470,724,247
Deferred income 302,910,467 329,345,661
Deferred income tax liabilities -
Other non-current liabilities 16,723,794 21,272,925
Total non-current liabilities 15,350,406,507 7,267,776,152
Total liabilities 51,403,068,753 41,551,700,183
Owners’ equity (or shareholders’ equity):
Paid-in capital (or share capital) 5,268,353,501 5,268,353,501
Other equity instruments 500,000,000.00 -
Including: preferred stock -
Perpetual bond 500,000,000.00 -
Capital reserves 4,914,468,683 4,914,468,683
Less: treasury stock -
Other comprehensive income -22,498,704 8,348,107
Special reserves -
Surplus reserves 1,650,910,274 1,760,690,436
Undistributed profits 2,583,660,300 3,835,099,435
Total owners’ equity (or shareholders' equity) 14,894,894,054 15,786,960,162
Total liabilities and owners’ equity (or shareholders' equity) 66,297,962,807 57,338,660,345
Legal Representative: Person in charge of Person in charge of
accounting work: accounting agency:
56
2020
Consolidated Income Statement
January to December in 2020
Prepared by: Shanghai Zhenhua Heavy Industries Co., Ltd. Unity: Yuan Currency: CNY
Item Note 2020 2019
I. Total operating revenue VII (61) 22,655,141,652 24,595,587,883
Including: Operating revenue 22,655,141,652 24,595,587,883
Interest income -
Premiums earned -
Fee and commission income -
II. Total operating cost 22,418,218,004 24,299,890,918
Including: operating costs VII (61) 19,413,265,254 20,590,531,322
Interest expenses -
Fee and commission expense -
Surrender value -
Net amount of compensation payout -
Net reserves for insurance liabilities -
Policy holder dividend expense -
Reinsurance expenses -
Taxes and surcharges VII (62) 106,278,271 108,028,681
Selling and distribution expenses VII (63) 105,763,639 122,517,036
General and administrative expenses VII (64) 937,700,839 1,095,131,287
Research and development expenditures VII (65) 737,468,137 887,096,178
Financial expenses VII (66) 1,117,741,864 1,496,586,414
Including: interest expenses 1,343,245,061 1,702,292,369
Interest income 369,113,644 331,452,183
Plus: other incomes VII (67) 93,228,051 88,459,588
Income from investment (loss expressed with “-”) VII (68) 413,517,783 174,600,552
Including: Income from investment of joint venture and cooperative enterprise 138,892,946 110,724,316
Income from derecognition of financial assets measured at amortized
cost
Exchange gain (loss expressed with “-”)
Net exposure hedging gain (loss expressed with “-”)
Income from fair value changes (loss expressed with “-”) VII (70) 94,172,456 88,019,844
Credit impairment losses (loss expressed with “-”) VII (71) -138,083,561 -38,761,593
Assets impairment losses (loss expressed with “-”) VII (72) -213,647,223 -52,494,284
Income from disposal of assets (loss expressed with “-”) VII (73) 6,755,688 49,091,913
III. Operating profits (loss expressed with “-”) 492,866,842 604,612,985
Plus: non-operating income VII (74) 17,337,499 16,462,710
Less: non-operating expenditure VII (75) 7,997,910 30,203,498
IV. Total profits (total loss expressed with “-”) 502,206,431 590,872,197
Less: income tax expenses VII (76) 86,071,000 93,750,584
V. Net profits (net loss expressed with “-”) 416,135,431 497,121,613
(I) Classified by business continuity
1. Net profits from ongoing operation (net loss expressed with “-”) 416,135,431 497,121,613
2. Net profits from discontinuing operation (net loss expressed with “-”)
(II) Classified by ownership
1. Net profit attributable to the shareholders of parent company (net loss expressed with “-”) 422,240,299 514,930,143
2. Minority interests (net loss expressed with “-”) -6,104,868 -17,808,530
57
Consolidated Income Statement(Continued)
January to December in 2020
Prepared by: Shanghai Zhenhua Heavy Industries Co., Ltd. Unity: Yuan Currency: CNY
Item Note 2020 2019
VI. Net of tax of other comprehensive income -109,245,376 22,021,165
(I) Net amount of after-tax other comprehensive income attributable to the owners of the
-86,457,849 15,806,812
parent company
1. Other comprehensive income that can't be reclassified into profit and loss -404,189 5,656,529
(1) Remeasure the variation of net indebtedness or net asset of defined benefit plan -
(2) Other comprehensive income that can't be reclassified into profit and loss in the invested
-
enterprise under equity method
(3) Fair value change of other equity instrument investments -404,189 5,656,529
(4) Fair value change of enterprise credit risks -
2. Other comprehensive income that will be reclassified into profit and loss -86,053,660 10,150,283
(1) Other comprehensive income that will be reclassified into profit and loss in the invested
-28,663,890 -2,004,706
enterprise under equity method
(2) Fair value change of other debt investments
(3) Amount of financial assets reclassified into other comprehensive income
(4) Provision for credit impairment of other debt investments
(5) Cash flow hedging reserve
(6) Translation reserve -57,389,770 12,154,989
(7) Others -
(II) Net of tax of other comprehensive income attributable to the minority shareholders -22,787,527 6,214,353
VII. Total comprehensive income 306,890,055 519,142,778
(I) Total comprehensive income belonging to parent company 335,782,450 530,736,955
(II) Total comprehensive income belonging to minority shareholders -28,892,395 -11,594,177
VIII. Earnings per share:
(I) Basic earnings per share (Yuan/share) 0.08 0.10
(II) Diluted earnings per share (Yuan/share) 0.08 0.10
In case of business combination under common control in current period, the net profit realized by the combined party
before combination was RMB 0, and the net profit realized by the combined party in the previous period was RMB 0.
Legal Representative: Person in charge of Person in charge of
accounting work: accounting agency:
58
2020
Income Statement of Parent Company
January to December in 2020
Prepared by: Shanghai Zhenhua Heavy Industries Co., Ltd. Unity: Yuan Currency: CNY
Item Note 2020 2019
I. Operating revenue XVII (4) 21,792,572,077 25,040,304,430
Less: operating costs XVII (4) 19,380,258,843 22,072,761,466
Taxes and surcharges 45,189,858 46,993,017
Selling and distribution expenses 85,994,613 95,598,294
General and administrative expenses 434,987,831 443,039,394
Research and development expenditures 588,658,451 733,613,874
Financial expenses 1,547,343,795 1,196,403,287
Including: interest expenses 1,050,532,128 1,287,736,007
Interest income 25,876,907 25,417,765
Plus: other incomes 54,518,751 66,222,311
Income from investment (loss expressed with “-”) XVII (5) 486,388,303 107,761,737
Including: Income from investment of joint venture and cooperative enterprise 134,225,470 106,972,779
Income from derecognition of financial assets measured at amortized cost
Net exposure hedging gain (loss expressed with “-”)
Income from fair value changes (loss expressed with “-”) 403,444,667 151,121,780
Credit impairment losses (loss expressed with “-”) -122,341,214 -16,036,863
Assets impairment losses (loss expressed with “-”) -207,234,914 -59,200,823
Income from disposal of assets (loss expressed with “-”) 6,340,002 4,536,497
II. Operating profits (loss expressed with “-”) 331,254,281 706,299,737
Plus: non-operating income 5,366,069 5,369,991
Less: non-operating expenditure 3,261,214 6,293,977
III. Total profits (total loss expressed with “-”) 333,359,136 705,375,751
Less: income tax expenses -4,564,696 61,014,198
IV. Net profits (loss expressed with “-”) 337,923,832 644,361,553
(I) Net profits from ongoing operation (net loss expressed with “-”) 337,923,832 644,361,553
(II) Net profits from discontinuing operation (net loss expressed with “-”) -
V. Net of tax of other comprehensive income -30,846,811 4,035,024
(I) Other comprehensive income that can't be reclassified into profit and loss -404,189 5,656,529
1. Remeasure the variation of net indebtedness or net asset of defined benefit plan -
2. Other comprehensive income that can't be reclassified into profit and loss in the invested
-
enterprise under equity method
3. Fair value change of other equity instrument investments -404,189 5,656,529
4. Fair value change of enterprise credit risks -
(II) Other comprehensive income that will be reclassified into profit and loss -30,442,622 -1,621,505
1. Other comprehensive income that will be reclassified into profit and loss in the invested
-28,663,890 -2,004,706
enterprise under equity method
2. Fair value change of other debt investments
3. Amount of financial assets reclassified into other comprehensive income
4. Provision for credit impairment of other debt investments
5. Cash flow hedging reserve
6. Translation reserve -1,778,732 383,201
7. Others -
VI. Total comprehensive income 307,077,021 648,396,577
VII. Earnings per share:
(I) Basic earnings per share (Yuan/share)
(II) Diluted earnings per share (Yuan/share)
Legal Representative: Person in charge of Person in charge of
accounting work: accounting agency:
59
Consolidated Statement of Cash Flows
January to December in 2020
Prepared by: Shanghai Zhenhua Heavy Industries Co., Ltd. Unity: Yuan Currency: CNY
Item Note 2020 2019
I. Cash flow from operating activities:
Cash from selling commodities or offering labor 24,070,729,586 23,025,755,641
Net increase of customer deposit and deposit from other banks -
Net increase of borrowings from central bank -
Net increase of borrowing funds from other financial institutions -
Cash from obtaining original insurance contract premium -
Net cash received from reinsurance business -
Net increase in the deposits and investment of insured -
Cash from interest, handling charges and commissions -
Net increase of borrowing funds -
Net increase of repurchase of business funds -
Net cash from acting trading securities -
Refund of tax and levies 851,809,553 1,271,698,523
Other cash received related to operating activities 338,290,726 329,767,258
Subtotal cash inflows from operating activities 25,260,829,865 24,627,221,422
Cash paid for goods purchased and services received 21,342,869,982 19,942,201,097
Net increase of customer loans and advances
Net increase of amount due from central bank and interbank
Cash paid for original insurance contract claims payment
Net increase of lending funds
Cash paid for interest, handling charges and commissions
Cash paid for policy dividend
Cash paid to and for employees 2,178,947,468 2,190,735,091
Taxes and fees paid 326,093,816 296,562,379
Other cash paid related to operating activities 593,529,579 907,509,746
Subtotal cash outflows from operating activities 24,441,440,845 23,337,008,313
Net cash flows from operating activities 819,389,020 1,290,213,109
II. Cash flows from investment activities:
Cash from investment withdrawal 209,790,000 50,000,000
Cash from investment income 267,656,685 73,626,236
Net cash received from disposal of fixed assets, intangible assets and other long-term assets 20,727,181 283,066,093
Net cash from disposal of subsidiaries and other business units -
Other cash received related to investment activities 337,058,520 267,388,460
Subtotal cash inflows from investment activities 835,232,386 674,080,789
Cash paid for purchase of fixed assets, intangible assets and other long-term assets 1,638,904,437 1,735,742,239
Cash paid for investments 134,489,526 485,500,000
Net increase in hypothecated loan -
Net cash paid for obtaining subsidiaries and other business units -
Other cash paid related to investment activities 266,251,559 -
Subtotal cash outflows from investment activities 2,039,645,522 2,221,242,239
Net cash flow from investment activities -1,204,413,136 -1,547,161,450
III. Cash flows from financing activities:
Cash from absorption of investments 379,445,000 808,250,000
60
2020
Consolidated Statement of Cash Flows(Continued)
January to December in 2020
Prepared by: Shanghai Zhenhua Heavy Industries Co., Ltd. Unity: Yuan Currency: CNY
Item Note 2020 2019
Including: cash received from subsidies’ absorption of minority shareholders’ investment 379,445,000 808,250,000
Cash received from issuance of other equity instruments 500,000,000
Cash received from borrowings 41,091,924,772 31,773,610,203
Other cash received related to financing activities 698,202,619 819,334,975
Subtotal cash inflows from financing activities 42,669,572,391 33,401,195,178
Cash repayments of amounts borrowed 39,243,737,056 29,962,425,560
Cash paid for distribution of dividends, profits or interest expenses 1,666,808,625 2,053,070,224
Including: dividends and profits paid by subsidiaries to minority shareholders 46,431,030 973,150
Other cash paid related to financing activities 1,409,615,762 1,243,765,574
Subtotal cash outflows from financing activities 42,320,161,443 33,259,261,358
Net cash flows from financing activities 349,410,948 141,933,820
IV. Impact of exchange rate movements on cash and cash equivalents -134,669,468 34,052,125
V. Net increase of cash and cash equivalents -170,282,636 -80,962,396
Plus: beginning balance of cash and cash equivalents 3,068,024,976 3,148,987,372
VI. Ending balance of cash and cash equivalents 2,897,742,340 3,068,024,976
Legal Representative: Person in charge of Person in charge of
accounting work: accounting agency:
61
Statement of Cash Flows of the Parent Company
January to December in 2020
Prepared by: Shanghai Zhenhua Heavy Industries Co., Ltd. Unity: Yuan Currency: CNY
Item Note 2020 2019
I. Cash flow from operating activities:
Cash from selling commodities or offering labor 21,198,017,154 20,652,573,566
Refund of tax and levies 824,627,008 1,240,029,186
Other cash received related to operating activities 272,781,596 311,770,463
Subtotal cash inflows from operating activities 22,295,425,758 22,204,373,215
Cash paid for goods purchased and services received 20,992,122,517 17,781,170,677
Cash paid to and for employees 1,113,852,152 1,045,121,920
Taxes and fees paid 71,734,723 74,252,976
Other cash paid related to operating activities 530,324,494 694,695,689
Subtotal cash outflows from operating activities 22,708,033,886 19,595,241,262
Net cash flows from operating activities -412,608,128 2,609,131,953
II. Cash flows from investment activities:
Cash from investment withdrawal 540,351,396 579,983
Cash from investment income 289,106,953 10,538,958
Net cash received from disposal of fixed assets, intangible assets and other long-term assets 13,953,970 59,069,806
Net cash from disposal of subsidiaries and other business units -
Other cash received related to investment activities - 9,674,112
Subtotal cash inflows from investment activities 843,412,319 79,862,859
Cash paid for purchase of fixed assets, intangible assets and other long-term assets 464,585,090 121,396,662
Cash paid for investments 471,062,850 453,354,150
Net cash paid for obtaining subsidiaries and other business units -
Other cash paid related to investment activities -
Subtotal cash outflows from investment activities 935,647,940 574,750,812
Net cash flow from investment activities -92,235,621 -494,887,953
III. Cash flows from financing activities:
Cash from absorption of investments -
Cash received from issuance of other equity instruments 500,000,000
Cash received from borrowings 34,915,443,955 23,196,312,114
Other cash received related to financing activities -
Subtotal cash inflows from financing activities 35,415,443,955 23,196,312,114
Cash repayments of amounts borrowed 33,153,717,317 23,435,344,092
Cash paid for distribution of dividends, profits or interest expenses 1,409,748,744 1,641,001,571
Other cash paid related to financing activities 203,727,816 407,455,030
Subtotal cash outflows from financing activities 34,767,193,877 25,483,800,693
Net cash flows from financing activities 648,250,078 -2,287,488,579
IV. Impact of exchange rate movements on cash and cash equivalents -58,610,469 12,864,249
V. Net increase of cash and cash equivalents 84,795,860 -160,380,330
Plus: beginning balance of cash and cash equivalents 1,770,070,810 1,930,451,140
VI. Ending balance of cash and cash equivalents 1,854,866,670 1,770,070,810
Legal Representative: Person in charge of Person in charge of
accounting work: accounting agency:
62
Consolidated Statement of Changes in Owners’ Equity
January to December in 2020
Prepared by: Shanghai Zhenhua Heavy Industries Co., Ltd. Unity: Yuan Currency: CNY
2020
Equity attributable to the owners of the parent company
Item Other equity instruments Minority Total owners’
Paid-in capital Other
Capital Less: treasury Special Surplus General risk Undistributed equity equity
(or share Preferred Perpetual comprehensive Others Sub-total
Others reserves stock reserves reserves preparation profits
capital) stock bond income
I. Balance at the end of the last year 5,268,353,501 4,834,854,332 23,530,451 3,615,638 1,761,198,709 3,651,851,383 15,543,404,014 3,027,632,431 18,571,036,445
Plus: changes in accounting policies -143,572,545 -1,399,694,619 -1,543,267,164 -71,475,128 -1,614,742,292
Prior period error correction
Business combination under common control
Others
II. Beginning balance in current year 5,268,353,501 4,834,854,332 23,530,451 3,615,638 1,617,626,164 2,252,156,764 14,000,136,850 2,956,157,303 16,956,294,153
III. Increase/decrease in the current year (“-” for decrease) 500,000,000 -86,457,849 -1,679,485 33,792,383 125,030,241 570,685,290 -451,741,232 118,944,058
(I) Total comprehensive income -86,457,849 422,240,299 335,782,450 -28,892,395 306,890,055
(II) Owner’s invested and decreased capital 500,000,000 500,000,000 237,775,830 737,775,830
1. Common stock invested by the owners
2. Capital invested by other equity instrument holders 500,000,000 500,000,000 500,000,000
3. Amount of share-based payment included in the owner’s equity
4. Disinvestment by minority shareholders of subsidiaries -141,669,170 -141,669,170
5. Investments received by subsidiaries from minority shareholders 379,445,000 379,445,000
6. Others
(III) Disposal of subsidiaries -614,227,994 -614,227,994
(IV) Profit distribution 33,792,383 -297,210,058 -263,417,675 -46,431,030 -309,848,705
1. Withdrawal of surplus reserves 33,792,383 -33,792,383
2. Withdrawal of general risk preparation
3. Distribution of owners (or shareholders) -263,417,675 -263,417,675 -46,431,030 -309,848,705
4. Others
(V) Internal transfer of owner’s equity
1. Capital surplus transfer to paid-in capital (or capital stock)
2. Earned surplus transfer to paid-in capital (or capital stock)
3. Earned surplus covering the deficit
4. Carryforward retained earnings in variation of defined benefit plan
5. Carryforward retained earnings of other comprehensive income
6. Others
(VI) Special reserves -1,679,485 -1,679,485 34,357 -1,645,128
1. Amount withdrawn in the current year 82,412,828 82,412,828 2,590,987 85,003,815
2. Amount used in the current year 84,092,313 84,092,313 2,556,630 86,648,943
(VII) Others
IV. Balance at the end of the current year 5,268,353,501 500,000,000 4,834,854,332 -62,927,398 1,936,153 1,651,418,547 2,377,187,005 14,570,822,140 2,504,416,071 17,075,238,211
2020
63
64
Consolidated Statement of Changes in Owners’ Equity(Continued)
January to December in 2020
Prepared by: Shanghai Zhenhua Heavy Industries Co., Ltd. Unity: Yuan Currency: CNY
2019
Equity attributable to the owners of the parent company
Item Other equity instruments Minority Total owners’
Paid-in capital Other
Capital Less: treasury Special Surplus General risk Undistributed equity equity
(or share Preferred Perpetual comprehensive Others Sub-total
Others reserves stock reserves reserves preparation profits
capital) stock bond income
I. Balance at the end of the last year 5,268,353,501 - - - 4,648,919,658 - 223,853,860 3,019,173 1,696,762,554 - 3,344,953,206 - 15,185,861,952 2,426,634,780 17,612,496,732
Plus: changes in accounting policies - - - - - - -216,130,221 - - - 119,821,864 - -96,308,357 -9,011,824 -105,320,181
Prior period error correction
Business combination under common control
Others
II. Beginning balance in current year 5,268,353,501 - - - 4,648,919,658 7,723,639 3,019,173 1,696,762,554 - 3,464,775,070 - 15,089,553,595 2,417,622,956 17,507,176,551
III. Increase/decrease in the current year (“-” for decrease) - 185,934,674 15,806,812 596,465 64,436,155 187,076,313 - 453,850,419 610,009,475 1,063,859,894
(I) Total comprehensive income - - - - - - 15,806,812 - - - 514,930,143 - 530,736,955 -11,594,177 519,142,778
(II) Owner’s invested and decreased capital - - - - 185,934,674 - - - - - - - 185,934,674 622,315,326 808,250,000
1. Common stock invested by the owners
2. Capital invested by other equity instrument holders
3. Amount of share-based payment included in the owner’s equity
4. Others
5. Investments received by subsidiaries from minority shareholders - - 185,934,674 185,934,674 622,315,326 808,250,000
(III) Profit distribution 64,436,155 - -327,853,830 - -263,417,675 -973,150 -264,390,825
1. Withdrawal of surplus reserves 64,436,155 - -64,436,155 -
2. Withdrawal of general risk preparation
3. Distribution of owners (or shareholders) - - - - - - - - - - -263,417,675 - -263,417,675 -973,150 -264,390,825
4. Others
(IV) Internal carry-forward of owners’ equity
1.Capital surplus transfer to paid-in capital (or capital stock)
2. Earned surplus transfer to paid-in capital (or capital stock)
3. Earned surplus covering the deficit
4. Carryforward retained earnings in variation of defined benefit plan
5. Carryforward retained earnings of other comprehensive income
6. Others
(V) Special reserves - - - - - - - 596,465 - - - - 596,465 261,476 857,941
1. Amount withdrawn in the current year - - - - - - - 71,228,319 - - - - 71,228,319 4,507,523 75,735,842
2. Amount used in the current year - - - - - - - 70,631,854 - - - - 70,631,854 4,246,047 74,877,901
(VI) Others
IV. Balance at the end of the current year 5,268,353,501 - - - 4,834,854,332 - 23,530,451 3,615,638 1,761,198,709 - 3,651,851,383 - 15,543,404,014 3,027,632,431 18,571,036,445
Legal Representative: Person in charge of Person in charge of
accounting work: accounting agency:
Statement of Changes in Owners’ Equity of the Parent Company
January to December in 2020
Prepared by: Shanghai Zhenhua Heavy Industries Co., Ltd. Unity: Yuan Currency: CNY
2020
Other equity instruments Other
Item Paid-in capital (or Less: treasury Special Undistributed Total owners’
Preferred Capital reserves comprehensive Surplus reserves
share capital) Perpetual bond Others stock reserves profits equity
stock income
I. Balance at the end of the last year 5,268,353,501 4,914,468,683 8,348,107 1,760,690,436 3,835,099,435 15,786,960,162
Plus: changes in accounting policies -143,572,545 -1,292,152,909 -1,435,725,454
Prior period error correction
Others
II. Beginning balance in current year 5,268,353,501 4,914,468,683 8,348,107 1,617,117,891 2,542,946,526 14,351,234,708
III. Increase/decrease in the current year (“-” for decrease) 500,000,000 -30,846,811 33,792,383 40,713,774 543,659,346
(I) Total comprehensive income -30,846,811 337,923,832 307,077,021
(II) Owner’s invested and decreased capital 500,000,000 500,000,000
1. Common stock invested by the owner
2. Capital invested by other equity instrument holders 500,000,000 500,000,000
3. Amount of share-based payment included in the owner’s equity
4. Others
(III) Profit distribution 33,792,383 -297,210,058 -263,417,675
1. Withdrawal of surplus reserves 33,792,383 -33,792,383
2. Distribution of owners (or shareholders) -263,417,675 -263,417,675
3. Others
(IV) Internal transfer of owner’s equity
1. Capital surplus transfer to paid-in capital (or capital stock)
2. Earned surplus transfer to paid-in capital (or capital stock)
3. Earned surplus covering the deficit
4. Carryforward retained earnings in variation of defined benefit plan
5. Carryforward retained earnings of other comprehensive income
6. Others
(V) Special reserves
1. Amount withdrawn in the current year 46,142,567 46,142,567
2. Amount used in the current year 46,142,567 46,142,567
(VI) Others
IV. Balance at the end of the current year 5,268,353,501 500,000,000 4,914,468,683 -22,498,704 1,650,910,274 2,583,660,300 14,894,894,054
2020
65
66
Statement of Changes in Owners’ Equity of the Parent Company(Continued)
January to December in 2020
Prepared by: Shanghai Zhenhua Heavy Industries Co., Ltd. Unity: Yuan Currency: CNY
2019
Paid-in capital Other equity instruments Other
Item Capital Less: treasury Special Surplus Undistributed Total owners’
(or share comprehensive
Preferred stock Perpetual bond Others reserves stock reserves reserves profits equity
capital) income
I. Balance at the end of the last year 5,268,353,501 - - - 4,914,468,683 - 71,258,509 - 1,696,254,281 3,520,430,440 15,470,765,414
Plus: changes in accounting policies -66,945,426 - - -1,838,728 -68,784,154
Prior period error correction
Others
II. Beginning balance in current year 5,268,353,501 - - - 4,914,468,683 - 4,313,083 - 1,696,254,281 3,518,591,712 15,401,981,260
III. Increase/decrease in the current year (“-” for decrease) - - - - - - 4,035,024 - 64,436,155 316,507,723 384,978,902
(I) Total comprehensive income - - - - - - 4,035,024 - - 644,361,553 648,396,577
(II) Owner’s invested and decreased capital
1. Common stock invested by the owner
2. Capital invested by other equity instrument holders
3. Amount of share-based payment included in the owner’s equity
4. Others
(III) Profit distribution - - - - - - - - 64,436,155 -327,853,830 -263,417,675
1. Withdrawal of surplus reserves - - - - - - - - 64,436,155 -64,436,155 -
2. Distribution of owners (or shareholders) - - - - - - - - - -263,417,675 -263,417,675
3. Others
(IV) Internal transfer of owner’s equity
1. Capital surplus transfer to paid-in capital (or capital stock)
2. Earned surplus transfer to paid-in capital (or capital stock)
3. Earned surplus covering the deficit
4. Carryforward retained earnings in variation of defined benefit plan
5. Carryforward retained earnings of other comprehensive income
6. Others
(V) Special reserves
1. Amount withdrawn in the current year - - - - - - - 43,399,676 - - 43,399,676
2. Amount used in the current year - - - - - - - 43,399,676 - - 43,399,676
(VI) Others - - - - - - - - - - -
IV. Balance at the end of the current year 5,268,353,501 - - - 4,914,468,683 - 8,348,107 - 1,760,690,436 3,835,099,435 15,786,960,162
Legal Representative: Person in charge of Person in charge of
accounting work: accounting agency:
2020
III. Company profile
1 Company profile
√Applicable □Not applicable
Shanghai Zhenhua Heavy Industries Co., Ltd. (hereinafter referred to as “the Company”) is a joint-stock company limited
established on September 8, 1997 through restructuring Shanghai Zhenhua Port Machinery Company Limited (hereinafter
referred to as “Zhenhua Company”). Both the registration place and the address of the headquarters are in Shanghai City, P. R.
China.
As approved by ZWFZ (1997) No.42 Document issued by the Securities Commission under the State Council, the
Company issued 100 million domestically-listed shares held by the foreign investors (B-share) from July 15, 1997 till July 17,
1997. The B-shares were listed for trading at Shanghai Stock Exchange on Aug. 5, 1997.
As approved by ZJFXZ (2000) No. 200 Document of China Securities Regulatory Commission, the Company
additionally issued of 88 million common shares (RMB denominated) (A-share) held by the domestic investors in December
2000. The A-shares were listed for trading at Shanghai Stock Exchange on Dec. 21, 2000.
As approved by ZJFXZ (2004) No.165 Document of China Securities Regulatory Commission, the Company additionally
issued 114,280,000 A-shares held by the domestic investors on December 23, 2004. The additionally issued A-shares were
listed at Shanghai Stock Exchange respectively for trading on December 31, 2004 and January 31, 2005.
As approved by ZJFXZ (2007) No. 346 Document of China Securities Regulatory Commission, the Company
additionally issued 125,515,000 A-shares held by the domestic investors on October 15, 2007. The additionally issued
A-shares were listed at Shanghai Stock Exchange for trading on October 23, 2007 and January 23, 2008 respectively.
As approved by ZJXKZ (2009) No.71 Document of China Securities Regulatory Commission, the Company privately
placed 169,794,680 A-shares on Sept. 22, 2008 to its controller China Communications Construction Co., Ltd. (hereinafter
referred to as “China Communications Corporation”). A-shares privately placed were the tradable shares with limited trading
conditions. From Mar. 20, 2012 on, the term of trading limitation expired for above-mentioned A-shares which were listed at
Shanghai Stock Exchange for trading.
By December 31, 2020, after all issuances of the shares and bonus shares distributed in the past year, the total shares
of the Company amounted to 5,268,353,501 shares, par value per share was RMB 1. The share capital totaled up to RMB
5,268,353,501.
On December 18, 2005, China Road and Bridge Construction Group General Company and the Company’s former
controlling shareholder China Harbor Construction (Group) General Company were merged into China Communications
Construction (Group) Co. Ltd after restructuring (hereafter referred to as “CCCG”). In accordance with the Official Reply to
Overall Reorganization and Overseas-listed and Domestically-listed Share of China Communications Construction Co. Ltd.
(GZGG [2006] No.1063 Document) by State-owned Assets Supervision and Administration Commission of the State Council
on Aug. 16, 2006, the reorganization proposal of China Communications Construction (Group) Co., Ltd approved in the
Official Reply to the Issues Concerning Management of State-owned Stock Equity of China Communications Construction
Co. Ltd. (GZCQ [2006] No.1072 Document) on Sept. 30, 2006 and the Official Reply to Approval of China Communications
Construction Co. Ltd.’s Announcement of Purchase Report of Road and Bridge Construction Co. Ltd. and Shanghai
Zhenhua Port Machinery (Group) Co. Ltd. and Exemption of Their Obligations for Purchase by Offer (ZJGSZ [2006] No.
227 Document), CCCG solely initiated the incorporation of China Communications Construction Co. Ltd. on Oct. 8, 2006
and invested the stock equity of the Company held into the newly incorporated China Communications Co., Ltd. With the
completion of reorganization, China Communications Co., Ltd thus became the controlling shareholder of the Company.
In 2016, the Company was granted the Uniform Social Credit Code of 91310000607206953D.
On July 18, 2017, the board of directors of China Communications Construction Co., Ltd. discussed and approved
the Proposal for Transfer of Some Shares of Shanghai Zhenhua Heavy Industries (Group) Co., Ltd by Agreement and
Associated Transaction and agreed to transfer totally 1,316,649,346 shares of this Company held by it to CCCG and CCCG
(Hong Kong) Holdings Co., Ltd. (hereinafter referred to as “CCCG Hong Kong”), accounting for 29.990% of the total shares
of this Company, after that, China Communications Construction Co., Ltd. held 16.239% of the stock equity of this Company.
The transfer and registration of shares was accomplished on December 27, 2017. On the date of the transfer of shares,
CCCG directly held 552,686,146 A-shares of this Company (accounting for 12.589% of the total shares of this Company),
indirectly held 763,963,200 B-shares of this Company through CCCG (Hong Kong) (accounting for 17.401% of the total
shares of the Company) and held 712,951,703 A-shares of this Company through China Communications Construction Co.,
Ltd. (accounting for 16.239% of the total shares of this Company), as a result, it became the controlling shareholder of the
Company.
The Company and its subsidiaries (hereinafter collectively referred to as “the Group”) was mainly engaged in design,
construction, installation and contracting of large-sized port handling system and equipment, offshore heavy-duty equipment,
engineering machinery, engineering vessel and large-sized metal structural members and their parts and components; repair
of vessel; leasing of self-produced crane, sales of the self-produced products; international shipment by available special
transportation vessel and specialized contracting for steel structure engineering.
The financial statements have been approved by the resolution of the Board of Directors of the Company on March 30,
2021.
67
2 Scope of consolidated financial statements
√Applicable □Not applicable
The consolidation scope of the consolidated financial statements is determined based on control. For the changes in the
current period and the main subsidiaries included in the scope of consolidation, please see Note IX.
IV. Basis of preparation for financial statements
1 Basis of preparation
The financial statements are prepared on the basis of the Accounting Standards for Business Enterprise– Basic
Standards issued by the Ministry of Finance and the subsequently issued and revised specific accounting principles,
guidelines, explanations and other related regulations (hereinafter collectively referred to as “Accounting Standards for
Business Enterprise”).
2 Going concern
√Applicable □Not applicable
The financial statements of the Company have been presented on a going concern basis.
As of December 31, 2020, the current liabilities of the Group were about RMB 1.8 billion beyond the current assets.
At the time of preparing the financial statements for the current year, in view of the facts that the Group has obtained the
bank credit line and the financing record and it has established good cooperation relationship with all banks and financial
institutions with good operation status, the Board of Directors of the Company believes that, the Group may continue
acquiring sufficient financing sources and operating cash flows to guarantee the funds required for operation, repayment
of expired debts and capital expenditures. Therefore, the Board of Directors of the Company firmly believes to prepare the
annual financial statements for the current year on a basis of going-concern.
While preparing the financial statements, except for some financial instruments, the valuation principle of historical cost
shall be adopted. If the assets are impaired, the provision for impairment is made in accordance with relevant provisions.
V. Principal accounting policies and accounting estimates
Specific accounting policies and accounting estimates tips
√Applicable □Not applicable
The Company determines the specific accounting policies and accounting estimates based on actual production and
operation characteristics, which are mainly reflected in the provision for bad debts receivable, inventory valuation methods,
business accounting of construction contracts, depreciation of fixed assets, amortization of intangible assets, measurement
model of investment properties and income recognition and measurement and so on.
1 Statement on compliance with the Accounting Standards for Business Enterprises
The financial statements meet the requirements of the Accounting Standards for Business Enterprises, and truly and
completely reflect the financial position of the Company and the Group as at December 31, 2020, and the operating results
and cash flows for the year then ended.
2 Accounting period
The Group adopts calendar year as the accounting year, which commences on January from the 1, and ends on
December 31 of each year.
3 Operating cycle
□Applicable √Not applicable
4 Functional currency
RMB is the recording currency of the Group and also the currency used in the financial statements. Unless otherwise
specified, the financial statements are presented in RMB.
The subsidiaries, joint ventures and associates under the Group shall, on the basis of the main economic environment
in which they operate, decide their own recording currency, and convert them into RMB when preparing financial statements.
5 Accounting treatment of business combination under common control and not under common control
√Applicable □Not applicable
Business combinations are classified into business combination under common control and business combination not
under common control.
Business combination under common control
The business combination under common control is a business combination in which all of the combining enterprises
68
2020
are ultimately controlled by the same party or the same parties both before and after the business combination and on which
the control is not temporary. In a business combination under common control, the party which obtains control of other
combining enterprise on the combination date is the absorbing party, the other combining enterprise is the combined party.
The combination date refers to the date on which the combining party actually obtains control on the combined party.
The assets and liabilities that the combining party obtains in a business combination under common control(including the
goodwill formed by the acquisition of the combined party by the ultimate controlling party), are subject to the corresponding
accounting treatment in accordance with the carrying amount in the financial statements of the ultimate controlling party
on the combination date. The difference between the carrying amount of the net assets obtained from the combination and
the carrying amount of the consideration paid (or total par value of the shares issued) for the combination is treated as an
adjustment to capital premium in the capital reserves and the capital reserves carried out under the former system. If the
capital premium is not sufficient to absorb the difference, the remaining balance is adjusted against retained earnings.
Business combination not under common control
The business combination not under common control is a business combination in which all of the combining enterprises
are not controlled by the same party or the same parties before and after the combination. As for the business combination
not under common control, the party which obtains the control of other combining enterprises on the acquisition date is the
acquirer, and the other combining enterprises is the acquiree. The acquisition date refers to the date on which the acquirer
actually obtains control on the acquiree.
The identifiable assets, liabilities and contingent liabilities obtained of the acquiree in the business combination not
under common control shall be measured at fair value on the acquisition date.
The positive balance between the sum of the fair value of the combined consideration paid (or fair value of the issued
equity securities) and the fair value of the held stock equity of the acquiree before the acquisition date and the fair value of
the identifiable net assets obtained in the combination from the acquiree is confirmed as goodwill, and shall be accounted
for subsequent measurement after subtracting the accumulated impairment losses from the cost. If the sum of the fair value
of the combined consideration paid (or fair value of the issued equity securities) and the fair value of the held stock equity of
the acquiree before the acquisition date is smaller than the fair value of the identifiable net assets of the acquiree obtained
in the combination, firstly recheck the measurement of the fair value of the identifiable assets, liabilities and contingent
liabilities obtained from the acquiree, and the fair value of the combined consideration paid (or fair value of the issued equity
securities), and the fair value of the held stock equity of the acquiree before the acquisition date, after that, if the sum the
fair value of the combined consideration paid (or fair value of the issued equity securities) and the fair value of the held stock
equity of the acquiree before the acquisition date is still smaller than the fair value of the identifiable net assets obtained in
combination from the acquiree, the balance shall be included in the current profit or loss.
6 Preparation of consolidated financial statements
√Applicable □Not applicable
The consolidation scope of consolidated financial statements is determined on the basis of control, covering the financial
statements of the Company and all the subsidiaries. A subsidiary is a subject which is controlled by the Company (including
the enterprise, the separable part of the invested entity, and the structural entity controlled by the Company).
When preparing the consolidated financial statements, the subsidiary adopts the accounting period and the accounting
policies consistent with the Company. Assets, liabilities, equity, income, expenses and cash flows arising from all transactions
between the Group’s internal companies are fully offset at the time of combination.
If the current losses borne by the minority shareholders of the subsidiary exceed the shares held by the minority
shareholders in the initial shareholders’ equity of the subsidiary, the balance still offsets the minority’s equity.
For the subsidiaries acquired in business combination not under common control, the operating results and the cash flows
of the acquiree shall be included in the consolidated financial statements on the date of acquisition of control till the termination of
control. When preparing the consolidated financial statements, the financial statements of subsidiaries shall be adjusted based on
the fair value of various identifiable assets, liabilities and contingent liability confirmed on the acquisition date.
For the subsidiaries acquired in business combination under common control, the operating results and the cash flows
of the combined party shall be included in the consolidated financial statements at the beginning of the combination period.
When preparing the consolidated financial statements, relevant items of the previous financial statements shall be adjusted
and the reporting entity formed after the consolidation is regarded as existed since the ultimate controlling party begins to
implement control.
If changes in the relevant facts and circumstances lead to changes in one or more control elements, the Group will re-
evaluate whether or not the investee is controlled.
The Group disposes of the equity investment in the subsidiaries step by step through multiple transactions until the
loss of control. If the above-mentioned transactions are part of a package transaction, the transactions are treated as a
transaction dealing with the equity investment of the subsidiary and losing control. However, before the loss of control, the
difference between the disposal price and the book value of the long-term equity investment corresponding to the disposed
equity is recognized as other comprehensive income in individual financial statements and transferred to the current profit
or loss when the control is lost. If the above-mentioned transactions are not part of a package transaction, accounting
treatment shall be carried out for each transaction separately according to whether the control is lost or not. If the control is
lost, the remaining equity is re-measured at fair value at the date when control is lost. The difference between the sum of the
69
consideration received on disposal and the fair value of remaining equity and the share of the former subsidiary's net assets
cumulatively calculated from the acquisition date according to the original proportion of shareholders' equity, is included in
the profit or loss in the period in which control is lost. If goodwill is involved, the amount of the goodwill shall be deducted
when calculating and determining the profit or loss on the disposal of the subsidiary. Other comprehensive income related
to the equity investment of the original subsidiary shall be accounted on the same basis as the subsidiary’s direct disposal
of relevant assets or liabilities when the control is lost. The shareholders’ equity recognized due to changes in shareholders’
equity other than net profit or loss, other comprehensive income and profit distribution related to the original subsidiary shall
be transferred to current profit or loss when the control is lost.
7 Classification of joint venture arrangement and methods of joint operation accounting treatment
□Applicable √Not applicable
8 Recognition criteria of cash and cash equivalents
Cash is the Group’s cash on hand and the deposits that can be readily drawn on demand. Cash equivalents are short-
term, highly liquid investments held by the Group that are readily convertible to known account of cash and which are subject
to an insignificant risk of changes in value.
9 Foreign currency transactions and transaction of financial statements denominated in foreign currency
√Applicable □Not applicable
In the case of a foreign currency transaction, the Group translates the amount of foreign currency into the amount of the
recording currency.
At the time of initial confirmation, the amount of foreign currency transaction shall be translated into the amount of the
recording currency at the spot rate of the transaction date. On the date of balance sheet, the currency exchange rate of the
currency denominated items shall be translated at the spot rate on the date of balance sheet. The transaction difference of
settlement and monetary items arising therefrom, in addition to the difference arising from foreign currency special borrowing
relating to the assets of which the purchase and construction conform to the capitalized conditions, which shall be handled
in accordance with the principle of capitalization of borrowing costs, shall be included in the current profit or loss. The foreign
currency non-currency items calculated on historical cost basis are still translated at spot rate on the date of transaction,
not changing the amount of its recording currency. The foreign currency non-monetary items measured at fair value shall
be translated at the spot rate on fair value determination date, and the difference arising therefrom shall be included in the
current profit or loss or other comprehensive income according to the nature of the non-monetary items.
In the case of overseas business, the Group translates its recording currency into RMB in preparing the financial
statements: for assets/liabilities in the balance sheet, spot exchange rate on the date of balance sheet is used for translation.
As for the items under the shareholders’ equity, except for those under “undistributed profits”, other items are translated using
the spot exchange rate at the time of occurrence; the income and expense items in the income statement shall be translated
at the spot exchange rate of the transaction. The conversion difference of foreign currency statements arising from above
translation shall be recognized as other comprehensive income. When disposing overseas operations, other comprehensive
income related to the overseas operation shall be transferred into the current profits and losses, partial disposal shall be
calculated according to the proportion of disposal.
Foreign currency cash flows shall be translated at the spot exchange rate on the day of occurrence of the cash flow.
Cash flow from overseas subsidiaries is translated at the spot exchange rate on the day of occurrence of the cash flow.
Effect of changes in exchange rate on cash amount is shown separately in the cash flow statements as an adjustment item.
10 Financial instruments
√Applicable □Not applicable
Financial instrument is the contract that forms the financial assets of an enterprise and the financial liabilities or equity
instruments of the other entities.
Recognition and de-recognition of financial instruments
The Group recognizes a financial asset or financial liability when becoming a party to a financial instrument contract.
Once the following conditions are satisfied, the Group will de-recognize financial assets (or part of financial assets or of
a portfolio of similar financial assets), i.e. writing off from its account and balance sheet:
(1) The right to receive cash flows from financial assets expires;
(2) The right to receive the cash flow from financial asset has been transferred, or have assumed the obligation in the
“pass-through agreement” to pay the collected cash flow timely to the third party in full; and (a) has transferred substantially
almost all the risks and rewards of ownership of the financial asset, or (b) although does not transfer or retain substantially
nearly all of the risks and rewards of ownership of the financial asset, but has given up the control over the financial asset.
In the event that the liability of a financial liability has been fulfilled, cancelled or expired, the financial liabilities shall be
de-recognized. If the existing financial liability is replaced by the same creditor with another financial liabilities of virtually
entirely different terms, or the terms of the existing liabilities are almost entirely modified substantially, such substitutions
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or modifications will be handled as the derecognition of the original liability and the recognition of new liabilities, and the
difference will be included in current profit or loss.
In case of trading financial assets in the conventional way, such financial assets will be recognized and de-recognized
on the trading day. Trading financial assets in the conventional way refers to collecting or delivering financial assets within
the time limit prescribed in the law or the prevailing practice in accordance with the terms and conditions of the contract.
Trading day is the date on which the Group commits to buy or sell financial assets.
Classification and measurement of financial assets
At the initial recognition, the Group's financial assets, based on the Group's management model of financial assets and
the contract cash flow characteristics of financial assets, are classified as financial assets measured at fair value through the
current profit or loss, financial assets measured at amortized cost, and financial assets measured at fair value through the
other comprehensive income.
Financial assets are measured at fair value at initial recognition, while the accounts receivable or notes receivable
arising from sales of goods or rendering of services, excluding the significant financing composition or the financial
composition for over one year, are initially measured at the transaction price.
For financial assets measured at fair value through the current profit or loss, relevant transaction costs are directly
included in the current profit or loss, while the transaction costs relevant to other financial assets are included in the initial
recognition amount.
The subsequent measurement of financial assets depends on the classification thereof:
Investment in debt instruments measured at cost
Financial assets simultaneously meet the following conditions are classified as the financial assets measured at
amortized cost: the management model of such financial assets aims at the collection of contract cash flows; according to
the terms in the contract for such financial assets, the cash flows generating on the special date are paid at the interest for
the principal and the unpaid principal. Such financial assets are recognized as interest income by the effective rate method,
and the gains or losses from the derecognition, modification or impairment thereof are in the current profit or loss.
Investment in debt instruments measured at fair value through other comprehensive income
If financial assets meet the following conditions at the same time, the Group classifies them as financial assets at fair
value through other comprehensive income: the Group’s business model for the management of the financial assets is
aimed at both the collection of contract cash flow and the sale of the financial assets; the contractual terms of the financial
asset stipulate that the cash flow generated at a particular date is only the payment of the principal and interest based on the
outstanding principal amount. The interest income of such financial assets is recognized by the effective interest method. At
derecognition of financial assets, the accumulated gains or losses previously included in other comprehensive income are
transferred from the other comprehensive income to the current profit or loss.
Investment in equity instruments measured at fair value through the other comprehensive income
The Group irrevocably chooses to designate some non-trading equity instruments as the financial assets measured
at fair value through the other comprehensive income, and only include the relevant dividends revenue (except for that
partially recovered as the investment cost) in the current profit or loss, and the subsequent changes in fair values in the other
comprehensive income, without the provision for impairment. At derecognition of financial assets, the accumulated gains
or losses previously included in other comprehensive income are transferred from the other comprehensive income to the
retained earnings.
Financial assets measured at fair value through the current profit or loss
The financial assets other than the financial assets measured at amortized cost and the financial assets measured at
fair value through the other comprehensive income are classified as the financial assets measured at fair value through the
other comprehensive income. For such financial assets, the subsequent measurement is made at fair value, and changes in
fair value are included in the current profit or loss.
Classification and measurement of financial liabilities
At the initial recognition, the Group’s financial liabilities are classified as: financial liabilities measured at fair value
through the current profit or loss, and other financial liabilities. For financial liabilities measured at fair value through the
current profit or loss, relevant transaction costs are directly included in the current profit or loss, while the transaction costs
relevant to other financial liabilities are included in the initial recognition amount.
The subsequent measurement of financial liabilities depends on the classification thereof:
Financial liabilities measured at fair value through the current profit or loss
Financial liabilities measured at fair value through the current profit or loss include the trading financial liabilities (including
the derivative instruments belonging to financial liabilities), and the financial liabilities measured at fair value through the
current profit or loss. The subsequent measurement of the trading financial liabilities (including the derivative instruments
belonging to financial liabilities) is made at fair value, and changes in fair value are included in the current profit or loss. For
the financial liabilities measured at fair value through the current profit or loss, the subsequent measurement is made at fair
value, and the changes in fair value are included in the current profit or loss except that the changes in fair value caused
by the changes in the Group's credit risks are included in the other comprehensive income; if including the changes in fair
value caused by the changes in the Group's credit risks in the other comprehensive income may cause or exacerbate the
accounting mismatch in profit or loss, the Group will include all changes in fair value (including the amounts affected by the
changes in the Group’s credit risks) in the current profit or loss.
71
Other financial liabilities
The subsequent measurement of such financial liabilities is made at amortized cost by the effective rate method.
Impairment of financial instruments
Based on the expected credit losses, the Group makes the provision for impairment and recognizes the loss provisions
for the financial assets measured amortized cost and the investment in debt instruments measured at fair value through the
other comprehensive income.
For the receivables excluding significant financing component, the Group measures the loss provision based on the
amount equivalent to the expected credit loss over the whole duration by the simplified measurement method.
Except for the above financial assets subject to the simplified measurement method, on each balance sheet date,
the Group makes assessment on whether the credit risk in financial assets has had significant increase after the initial
recognition. If the credit risk does not significantly increase after the initial recognition, standing at the first level, the Group
will measure the loss provision based on the amount of expected credit loss over the next 12 months, and calculate the
interest income based on the book balance at the effective interest rate; if the credit risk has significantly increased after
the initial recognition without any credit impairment, standing at the second level, the Group will measure the loss provision
based on the amount equivalent to the expected credit loss over the whole duration; in case of any credit impairment after
the initial recognition, standing at the third level, the Group will measure the loss provision based on the amount of expected
credit loss over the whole duration, and calculate the interest income based on the amortized cost at the effective interest
rate. For financial instruments only with relatively low credit risk on the balance sheet date, the Group assumes that such
credit risk does not significantly increase after the initial recognition.
The Group evaluates the expected credit loss of financial instruments individually and by portfolio. After taking the credit
risk characteristics of different customers into account, the Group evaluated the expected credit loss on accounts receivable
by the aging portfolio.
For the Group’s disclosure of the judgment standards for significant increase of credit risk, definition of assets with credit
impairment and assumption of the measurement of expected credit loss, see Note X for details.
When the Group ceases to expect reasonably the contract cash flows of financial assets which can be recovered in
whole or in part, the Group will directly write off the book balance of such financial assets.
Financial instrument offset
Financial assets and financial liabilities are presented in the balance sheet at the net amount after mutual offset when
the following conditions are met simultaneously: possess the legal right to offset the recognized amount and such right is
currently executable; intend to settle at net amount, or cash such financial assets or liquidate such financial liabilities.
Financial guarantee contracts
A financial guarantee contract refers to the contract where the issuer shall pay the specific amount to the contract holder
suffering losses when the specific debtor fails to repay debts according to the financial guarantee clauses. The financial
guarantee contracts are measured at fair value at initial recognition. Financial guarantee contracts other than those the
financial liabilities measured at fair value through the current profit or loss are subsequently measured at the higher between
the amount of expected credit loss reserve determined on the balance sheet date and the balance of the initially recognized
amount deducting the accumulated amortization amount determined in the revenue recognition principle.
Derivative financial instruments
The Group carries out the exchange rate risk hedging by using derivative financial instruments, such as the forward
exchange contract and the foreign exchange option contract. Derivative financial instruments are initially measured at
their fair values on date of signing relevant derivative transaction contracts and subsequently measured at their fair
values. Derivative financial instrument with positive fair value is recognized as an asset, and that with negative fair value is
recognized as a liability.
Gains or losses from changes in fair values of derivative instruments are directly included in the current profit or loss,
unless they are related to the hedging accounting.
Transfer of financial assets
If the Group has transferred nearly all the risks and rewards associated with the ownership of financial assets to the
transferee, such financial assets will be de-recognized; if the Group retains nearly all the risks and rewards associated with
the ownership of financial assets, such financial assets will continuously recognized.
If the Group neither transfers nor retains nearly all the risks and rewards associated with the ownership of the financial
assets, the following treatments will be adopted based on different circumstances: if the Group has given up its control
over the financial assets, the financial assets will be derecognized, and the assets and liabilities arising therefrom will be
recognized; if the Group does not give up its control over the financial assets, the financial assets will be recognized to the
extent of its continuing involvement in the transferred financial assets, while relevant liabilities are recognized accordingly.
11 Notes receivable
Determination and accounting treatment of the expected credit loss of notes receivable
□Applicable √Not applicable
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12 Accounts receivable
Determination and accounting treatment of the expected credit loss of accounts receivable
□Applicable √Not applicable
13 Receivables financing
□Applicable √Not applicable
14 Other receivables
Determination and accounting treatment of the expected credit loss of other receivables
□Applicable √Not applicable
15 Inventories
√Applicable □Not applicable
Inventories include the raw materials, outsourcing components and parts, goods in process, stock commodities and
contract performance cost.
Inventories are initially measured at the cost. The inventory cost includes the procurement cost, processing cost and
other cost. The actual cost of inventory in transit is determined by the weighted average method.
Perpetual inventory system is adopted for inventories.
On the balance sheet date, the inventory is measured at its cost or its net realizable value, whichever is lower; if the
cost is higher than the net realizable value, the provision for inventory depreciation will be made and included in the current
profit or loss. If the previous factor for the provision for inventory depreciation has been eliminated, resulting that the net
realizable value of the inventory is higher than the cost of the same, the amount written down will be reversed in the amount
of provision for inventory depreciation originally made, and the reversed amount will be included in the current profit or loss.
The net realizable value, in the routine activities, refers to amount of the estimated selling price of inventory minus
the estimated cost to completion, estimated selling expense and relevant taxes and surcharges. At the time of making the
provision for inventory depreciation, the provision for depreciation of raw materials is made by category, and that of goods in
process, stock commodities and contract performance cost is made by each single inventory item.
Construction contract (only applicable to year 2019)
For large port equipment, heavy equipment and steel products as well as construction projects customized for
customers, as the commencement dates and the completion dates are usually in different accounting years, the Group
accounts for their revenue and costs by the construction contract.
(a) If the outcome of a construction contract can be estimated reliably, the revenue and cost of such construction
contract will be recognized on the balance sheet date based on the progress of completion by the percentage-of-completion
method. The outcome of a construction contract can be estimated reliably means that the economic benefit relevant to
the contract is likely to flow in the Group, and the actually incurred contract cost can be clearly distinguished and reliably
measured; for fixed price contracts, the following conditions should be also met: The total contract revenue can be reliably
measured, and the progress of completion and the cost to complete the contract can be reliably determined. Total contract
revenue includes the initial cost specified in the contract and the revenue from contract change, claim and award. The Group
determines the progress of contract completion by the following ways:
(i) For large port equipment, the progress of completion is determined at the percentage of completion corresponding to
the time-point for recognizing the revenue of the construction contract at the end of the period. The Group has determined
the following three revenue recognition time-points:
Time-point 1: The manufacturing of main steel structure has been completed and set upright;
Time-point 2: The product manufacturing, installation and preliminary debugging have been completed, the factory
qualification certificates for products have been issued, the bill of loading has been obtained, and the product delivery has
been prepared;
Time-point 3: The products have been delivered to the purchaser upon the purchaser’s inspection, and the delivery
certificate issued by the purchaser has been obtained.
The Group analyzes construction contracts completed in the previous year by the category of product, and determines
the percentage of completion to be recognized at each revenue recognition time-point, based on the proportion of the cost at
the each revenue recognition time-point mentioned above in the total actual cost, and takes such percentage of completion
as that to be recognized at each revenue recognition time-point in the current period.
(ii) For heavy equipment and construction projects, the completion of completion is determined based on the proportion
of the contract cost accumulated incurred in the total estimated contract costs. The accumulated incurred contract cost does
not include the relevant contract costs in the future activities.
(iii) For steel structure manufacturing, the progress of completion is determined based on the proportion of the
accumulatively completed processing tonnage in the total estimated processing tonnage.
(b) If the outcome of an individual construction contract cannot be estimated reliably, the treatment will be taken
separately in following situations:
73
(iv) If the contract cost is recoverable, it will be recognized based on the actual contract cost recoverable as the contract
expense in the period when such cost is incurred.
(v) If the contract cost is not recoverable, it will be recognized as contract expense when it is incurred, without contract
revenue recognition.
(c) If the total estimated contract cost is more than the total estimated contract revenue, the estimated loss will be
immediately recognized as the current profit or loss.
(d) For the contract price by installment, the settled price is presented, and will be reversed based on relevant
accumulated incurred cost and the accumulated recognized gross profit after the settlement of construction contract. On
the balance sheet date, the difference between the sum of the accumulated incurred cost and the accumulated recognized
gross profit and the settled price (the former is larger) is presented as the completed but not settled construction payment in
the current assets; in case the latter is larger, such difference will be presented as the settled but not completed construction
payment in the current liabilities.
16 Contract assets
(1) Recognition method and criteria of contract assets
√Applicable □Not applicable
The Group presents contract assets or liabilities in the balance sheet according to the relationship between the
fulfillment of performance obligations and customer payments. After offsetting the contract assets and contract liabilities
under the same contract, the Group presents them in net amount.
Contract assets
Contract assets refer to the right to receive consideration for goods or services transferred to customers, and the right
depends on factors other than the passage of time.
For details of the Group’s determination and accounting treatment method of expected credit loss of contract assets,
please refer to Note V.
(2) Determination and accounting treatment of the expected credit loss of contract assets
□Applicable √Not applicable
17 Assets held for sale
□Applicable √Not applicable
18 Debt investment
(1) Determination and accounting treatment of the expected credit loss of debt investment
□Applicable √Not applicable
19 Other debt investment
(1) Determination and accounting treatment of the expected credit loss of other debt investment
□Applicable √Not applicable
20 Long-term receivables
(1) Determination and accounting treatment of the expected credit loss of long-term receivables
□Applicable √Not applicable
21 Long-term equity investments
√Applicable □Not applicable
Long-term equity investments include the equity investments in subsidiaries, joint ventures and associates.
Long-term equity investments are initially measured at the initial investment cost. The initial investment cost of a long-
term equity investment acquired through the business combination under common control is recognized at book value of
owners' equity acquired from the combinee on the combination date in the consolidated financial statements of the ultimate
controller; the difference between the initial investment cost and the book value of the combination consideration is used to
adjust the capital reserves (if the capital reserves are insufficient to offset, the retained earnings will be offset); for the other
comprehensive income before the combination date, at the disposal of such investment, the accounting treatment identical
to that for the direct treatment of relevant assets or liabilities by the investee is adopted; the shareholders’ equity recognized
on account of the change in other shareholders’ equity of the investee other than net profit or loss, other comprehensive
income and profit distribution is transferred in the current profit or loss at the disposal of such investment; in which, after such
disposal, if such investment is still the long-term equity investment, it will be carried forward in proportion; if it is converted
into the financial instrument, it will be carried forward in full.
The initial investment cost of a long-term equity investment acquired through business combination not under common
control is recognized at the combination cost (if the business combination not under common control is realized through
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2020
several transactions by step, the sum of the book value of the equity investment of the acquiree held before the acquisition
date and the cost of investment newly added on the acquisition date is recognized as the initial investment cost), and the
combination cost includes the asset paid by the acquiree, liability incurred or borne by the acquiree, and the fair values of
issued equity securities; for the other comprehensive income held before the acquisition date and recognized due to the
accounting under equity method, at the disposal of such investment, the accounting treatment identical to that for the direct
treatment of relevant assets or liabilities by the investee is adopted; the shareholders’ equity recognized on account of the
change in other shareholders’ equity of the investee other than net profit or loss, other comprehensive income and profit
distribution is transferred in the current profit or loss at the disposal of such investment; in which, after such disposal, if such
investment is still the long-term equity investment, it will be carried forward in proportion; if it is converted into the financial
instrument, it will be carried forward in full. The accumulated changes in fair values of the equity investments held before the
acquisition date, which was included in the other comprehensive income as the financial instruments, are fully transferred
in the retained earnings (from 2019) or the current profit or loss (before 2019), on the accounting at cost. For long-term
equity investments acquired not through business combination, their initial investment costs are determined by the following
ways: if the long-term equity investment is acquired through cash payment, the initial investment cost will be the sum of the
acquisition price actually paid and the costs, taxes and other necessary costs, which are directly relevant to the long-term
equity investment; if the long-term equity investment is acquired by issuing equity securities, the initial investment cost will be
the fair value of the equity securities issued.
The long-term equity investments where the Company could control the investee shall be accounted in individual
financial statements of the Company under the cost method. Control means the power owned over the investee and enjoys
the variable return through participating in activities related to the investee, and has the ability to affect its return by using the
power over the investee.
Under the cost method, long-term equity investments are valuated at initial investment cost. The Company shall
increase or recover the investment to adjust the cost of long-term equity investments. Cash dividends or profits declared and
distributed by the investee should be recognized as investment income in the current period.
If the Group has joint control over or significant influence on the investees, long-term equity investments are accounted
for with the equity method. Joint control refers to the control shared over an arrangement in accordance with the relevant
stipulations, and the decision-making of related activities of the arrangement should not be made before the party sharing
the control right agrees the same. Significant influence refers to the power to participate in making decisions on the financial
and operating policies of the investee, but not the power to control, or jointly control, the formulation of such policies with
other parties.
For long-term equity investments measured under the equity method, if the initial investment costs are higher than the
investor's attributable share of the fair value of the investee's identifiable net assets, the initial costs of the long-term equity
investments shall be recognized; if the initial investment costs are lower than the investor's attributable share of the fair value
of the investee's identifiable net assets, the difference shall be recognized in current profit and loss and at the same time the
adjustment will be made to the initial costs of the long-term equity investments.
Where the equity method is adopted, after the long-equity investments are acquired, the Company shall, according to
the shares of net profit and loss and other comprehensive income realized by the investee which the Company shall enjoy
or bear, recognize the profit and loss on the investments and other comprehensive income and adjust the book value of the
long-term equity investments. When recognizing the share of net profit or loss of the investee that the Group shall enjoy,
based on fair value of various identifiable assets and others of the investee on acquisition and according to accounting
policies and accounting periods of the Group, the Group shall write off the part of incomes from internal transactions with
associates and joint ventures which are attributable to the investor according to the shareholding ratio (but the loss from
internal transactions is the asset impairment loss, its total amount shall be recognized) and then recognize the profit and
loss on investments on such basis, except those assets investments or sale constitute business. The Group shall, in the
light of the profits or cash dividends that the investee declares to distribute, calculate the part it should share and reduce the
book value of the long-term equity investment correspondingly. Recognition of the net loss in the investee shall be within
the limit that the book value of long-term equity investments and other long-term interests which substantially form the net
investment in the investee are reduced to zero, unless the Group is obliged to bear extraneous losses; For other changes
in shareholder's equity of the investee excluding net losses or profits, other comprehensive income or profit distribution, the
book value of long-term equity investments will be adjusted and included in shareholder's equity.
For disposal of long-term equity investments, the difference between the book value and the actual price shall be
included in the current investment income. For long-term equity investments recognized under equity method, when the
equity method is no longer adopted due to the disposal, accounting treatment should be made for other comprehensive
income previously recognized under the equity method by using the same basis for the investee to directly dispose the
relevant assets or liabilities. Shareholder's equity recognized from the investee's changes in other shareholder’s equity
other than net profit or loss, other comprehensive income and profit distribution should all transferred to the current profits
or losses. If the equity method is still adopted, the relevant other comprehensive income accounted by the original equity
method shall be accounted on the same basis as the invested entity's direct disposal of relevant assets or liabilities, and shall
be transferred to the current profit or loss in proportion. The shareholders’ equity recognized due to changes in shareholders’
equity of the investee other than net profit or loss, other comprehensive income and profit distribution shall be transferred to
the current profit or loss according to corresponding proportion.
75
The Group disposes of the equity investment in the subsidiaries step by step through multiple transactions until the
loss of control. If the above-mentioned transactions are part of a package transaction, the transactions are treated as a
transaction dealing with the equity investment of the subsidiary and losing control. However, before the loss of control, the
difference between the disposal price and the book value of the long-term equity investment corresponding to the disposed
equity is recognized as other comprehensive income in individual financial statements and transferred to the current profit or
loss when the control is lost. If the above-mentioned transactions are not part of a package transaction, accounting treatment
shall be carried out for each transaction separately. If the control is lost, in the individual financial statements, for the
remaining equity, if the remaining equity after disposal can jointly control or has a significant impact on the original subsidiary,
it shall be recognized as long-term equity investment, and the accounting treatment shall be carried out according to relevant
provisions on the conversion of cost method into equity method; otherwise, it shall be recognized as a financial instrument,
and the difference between the fair value and the book value on the date of loss of control is included in the current profit or
loss.
22 Investment properties
Investment properties refer to properties that are held for the purposes of earning rental income, capital appreciation, or
some combination thereof, including land use rights and buildings that have been leased out.
The investment property shall be initially measured at cost. Subsequent expenses related to investment properties, if
the economic benefits associated are likely to flow in and its cost can be measured reliably, should be recorded in the cost of
investment property. Otherwise, such subsequent expenses should be included in current profits or losses upon occurrence.
The subsequent measurement of an investment property shall be conducted by the Group under the cost method, and
the land use right and buildings shall be amortized and depreciated according to the expected useful life and net residual
rate of the investment property. The expected useful lives, net residual value rate and annual depreciation (amortization) rate
of the investment properties are as follows:
Estimated useful lives Estimated net residual value rate Annual depreciation (amortization) rate
Buildings 30 years 0% 3.3%
Determined according to the estimated
Land use right Land useful lives 0% net residual value and useful life for
the land useful lives
The Group shall review estimated useful lives, estimated net residual value and depreciation (amortization) methods of
the investment properties at the end of each year and shall make adjustment when necessary.
When an investment property is changed for self-use, upon change, the investment property shall be converted into
fixed assets or intangible assets. When the self-use property is changed to earn rentals or for capital appreciation, upon
change, fixed assets or intangible assets shall be converted into investment properties. When there is a conversion, the book
value before the conversion shall be regarded as the book value after the conversion.
23 Fixed assets
(1) Recognition criteria
√Applicable □Not applicable
Fixed assets will only be recognized when the economic benefits relating to the fixed assets may flow into the Group
and the costs of the fixed assets can be measured reliably. If the subsequent disbursements relevant to a fixed asset meet
the recognition conditions, they shall be recorded in the cost of fixed asset, and the book value of the replaced part shall be
derecognized; otherwise, they shall be recorded in the current profits and losses.
Fixed assets are initially measured at cost. The costs of externally acquired fixed assets comprise their purchase prices,
related taxes and surcharges and any attributable expenditure incurred to prepare the asset for its intended use.
(2) Depreciation method
Except for the fixed assets form by using withdrawn safe production costs, the provisions for the depreciation of fixed
assets are made by straight-line method, and the useful lives, expected net salvage value and annual depreciation rates of
various fixed assets are as follows:
√Applicable □Not applicable
Depreciation Estimated net residual Annual
Category Useful lives
method value rate depreciation rate
Buildings and constructions Straight-line method 20-40 years 0% 2.5%-5%
Mechanical equipment Straight-line method 3-20 years 0% 5%-33.3%
Office and electronic equipment Straight-line method 3-5 years 0% 20%-33.3%
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Depreciation Estimated net residual Annual
Category Useful lives
method value rate depreciation rate
Transportation facilities (excluding ship) Straight-line method 5 years 0% 20%
Ship Straight-line method 10-30 years 5%/10% 3%-9.5%
(3) Identification basis, valuation and depreciation method of fixed assets under financing lease
√Applicable □Not applicable
The fixed assets acquired under financing leases adopt the same depreciation policies for the provision for the
depreciation of leased assets as those of its own fixed assets. Where it can be reasonably certain that the Company will
obtain ownership of the leased asset at the expiry of the lease term, the leased assets are depreciated over the useful life;
where it cannot be reasonably certain that the Company can obtain ownership of the leased asset at the end of the lease
term, the leased assets are depreciated at the shorter of the lease term and the use life of the leased assets.
The Group shall review useful lives, estimated net residual value and depreciation methods of the fixed assets at the
end of each year and shall make adjustment when necessary.
24 Construction in progress
√Applicable □Not applicable
The Group recognizes the cost of the construction in progress at the actually incurred expenditures, including all types
of necessary expenditures incurred during the construction period, the capitalized borrowing costs incurred prior to the time
when the construction is brought to the expected conditions for use and other relevant costs.
The construction in progress is converted into fixed assets after it reaches the expected conditions for use.
25 Borrowing costs
√Applicable □Not applicable
Borrowing costs refer to the interest and other relevant costs of the Company due to borrowings, including the interest of
borrowings, the amortization of discount or premium, auxiliary expenses, exchange differences incurred by foreign currency
borrowings, etc.
The Group capitalizes the borrowing costs of acquisition or construction or production which may directly belong to
assets that are eligible for capitalization; and other borrowing costs are included in the current profit or loss. Assets eligible
for capitalization refer to fixed assets, investment property, inventories and other assets which may reach their intended use
or sale status only after long-time acquisition and construction or production activities.
The borrowing costs shall not be capitalized unless they simultaneously meet the following requirements:
(1) The asset disbursements have already incurred;
(2) The borrowing costs have already incurred; and
(3) Purchase, construction or manufacturing activities that are necessary to prepare the asset for its intended use or
sale have already started;
Capitalization of borrowing costs should cease when the acquired and constructed or produced assets eligible for
capitalization have reached the working condition for their intended use or sale. The borrowing costs incurred thereafter shall
be included in the current profit or loss.
During the period of capitalization, the capitalized amount on interest of each accounting period shall be determined in
accordance with the following provisions:
(1) The interest of special borrowings to be capitalized should be determined according to the actually incurred interest
expenses in the current period less the interest income on deposits or the investment income;
(2) The interest of general borrowings to be capitalized should be calculated by multiplying the weighted average of
asset disbursements of the part of accumulated asset disbursements exceeding special borrowings by the weighted average
rate of used general borrowings.
If the acquisition and construction or production activities of assets eligible for capitalization are abnormally interrupted
due to the matters other than necessary procedures for such assets to reach the working conditions for its intended use or
sale and such circumstance lasts for more than three months, the capitalization of borrowing costs should be suspended.
Borrowing costs incurred during the interruption are recognized as the current profit or loss and continue to be capitalized
until the acquisition, construction or production of the asset restarts.
26 Biological assets
□Applicable √Not applicable
27 Oil and gas assets
□Applicable √Not applicable
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28 Right-of-use assets
□Applicable √Not applicable
29 Intangible assets
(1) Valuation method, service life and impairment test
√Applicable □Not applicable
Intangible assets will be recognized only when relevant economic benefits may well flow into the Group and the costs
of intangible assets can be measured reliably, and initially measured at costs. However, if the fair value of the intangible
assets acquired in the business combination not under common control can be reliably measured, it should be recognized
as intangible assets and measured at fair value separately. When the Company reconstructs its corporate system, for the
intangible assets invested by the shareholders of the state-owned shares, the evaluation value confirmed by the state-owned
assets management department shall be served as the book value.
The useful life of an intangible asset is determined based on the period during which it can bring economic benefits to
the Group. If the said period cannot be predicted, it will be recognized as an intangible asset with indefinite useful life.
The useful lives of all kinds of intangible assets are determined as follows:
Useful life
Land use right Land useful lives
Software use fees 5 years
Proprietary technology 10 years
The land use rights acquired by the Group are usually accounted as intangible assets. For the plants and other buildings
developed and constructed by the Company, relevant land use rights and constructions shall be respectively accounted as
intangible assets and fixed assets. For externally purchased land and buildings, the related payments are distributed in the
land use right and buildings; those difficult to be distributed shall be all handled as fixed assets.
For the intangible assets with limited useful life, their amount shall be amortized at the straight-line method over its
useful life. The Group will reexamine the useful lives and amortization method of intangible assets with limited useful lives,
and make adjustments when necessary at the end of each year.
(2) Accounting policy of internal R & D expenditures
√Applicable □Not applicable
The Group's expenditures for its internal research and development projects are classified into research expenditures
and development expenditures. The expenditures in research phase will be included in the current profit or loss on
occurrence. The development expenditures will be capitalized only when all of the following conditions are satisfied
simultaneously: It is feasible technically to finish intangible assets for use or sale; It is intended to finish and use or sell the
intangible assets; The usefulness of methods for intangible assets to generate economic benefits shall be proved, including
being able to prove that there is a potential market for the products manufactured by applying the intangible assets or there
is a potential market for the intangible assets itself or the intangible assets will be used internally; It is able to finish the
development of the intangible assets, and able to use or sell the intangible assets, with the support of sufficient technologies,
financial resources and other resources; and the expenditures attributable to the intangible asset during its development
phase can be measured reliably. Development expenditures that do not meet the above conditions are included in the
current profit or loss on occurrence.
30 Asset impairment
√Applicable □Not applicable
The Group recognizes the asset impairment under the following methods except for inventories, contract assets and
assets related to contract cost, deferred income tax and financial assets:
The Group shall, on the balance sheet date, make a judgment on whether there is any indication that the assets may
impair. If such indication does exist, the Group shall estimate the recoverable amount and carry out an impairment test.
Impairment tests for goodwill caused by business combination shall be conducted at the end of every year whether they
have signs of impairment or not. Impairment tests for intangible assets not reaching usable condition shall be conducted
every year.
The recoverable amounts of assets are the higher of their fair values less costs to sell and the present values of the
future cash flows expected to be derived from the assets. The Group shall, on the basis of single item assets, estimate the
recoverable amount. Where it is difficult to do so, it shall determine the recoverable amount of the group assets on the basis
of the asset group to which the asset belongs. The recognition of an asset group shall base on whether the main cash inflow
generated from the asset group is independent of those generated from other assets or other group assets.
Where the recoverable amount of an asset or an asset group is lower than its book value, the book value of the asset or
asset group shall be written down to their recoverable amounts. The write-downs are recorded into the current profit or loss
and the provision for asset impairment are made accordingly at the same time.
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When the Company makes an impairment test of goodwill, it shall, as of the purchasing day, apportion the book value of
the goodwill formed by business combination to the relevant asset groups by a reasonable method. Where it is difficult to do
so, it shall be apportioned to the relevant portfolio of asset groups .The related asset group or combination of asset groups
shall be the asset group or combination of asset groups that can benefit from the synergy effect of business combination,
and shall be smaller than the reporting segments as determined by the Group.
When making an impairment test on the relevant asset groups or combination of asset groups containing goodwill, if any
indication shows that the asset groups or combinations of asset groups related to the goodwill may be impaired, the Group
shall first conduct an impairment test on the asset groups or combinations of asset groups not containing goodwill, calculate
the recoverable amount and recognize the corresponding impairment loss. Then, the Group shall conduct an impairment test
on the asset groups or asset groups portfolio containing goodwill, and compare it book value and recoverable amount: if the
recoverable amount is lower than book value, the amount of impairment losses should be firstly used to deduct book value
of goodwill allocated to the asset group or the asset group portfolio, and then deduct book value of other assets according to
the proportion of the book value of other assets other than the goodwill in the asset group or the asset group portfolio.
Once the loss of assets impairment is recognized, it is not allowed to be reversed even if the value can be recovered in
subsequent period.
31 Long-term deferred expenses
√Applicable □Not applicable
Long-term deferred expenses shall be amortized at the straight-line method, and the amortization period is set out as
follows:
Amortization period
Improvement of fixed assets acquired under the operating lease Expected beneficial period
32 Contract liabilities
(1) Recognition method of contract liabilities
√Applicable □Not applicable
The Group presents contract assets or liabilities in the balance sheet according to the relationship between the
performance of contract obligations and customer payments. After offsetting the contract assets and contract liabilities under
the same contract, the Group presents them in net amount.
Contract liabilities
Contract liability refers to the obligation to transfer goods or services to customers for the consideration received or
receivable from customers, such as the money received by enterprises before transferring the promised goods or services.
33 Employee compensation
Employee compensations refer to multiform remuneration or compensation offered of the Group in order to get services
provided by its employees or sever the labor relation. Employee compensation mainly includes short-term employee
compensation, post-employment benefits, dismissal benefits and other long-term employee benefits. The welfare provided
by the Company to employees' spouses, children, dependents, family dependants of the deceased employee and other
beneficial owners also belong to employee compensation.
Short-term compensation
(1) Accounting treatment of short-term compensation
√Applicable □Not applicable
During the accounting period of an employee' providing services, the short-term compensation actually incurred is
recognized as liabilities and includes them in the current profit or loss or the related asset costs.
(2) Accounting treatment of post-employment benefits
√Applicable □Not applicable
The employees of the Group participated in the endowment insurance and unemployment insurance managed by the
local government, and also participated in the enterprise annuity, and the corresponding expenses were included in the
relevant asset costs or the current profit or loss when incurred.
(3) Accounting treatment of termination benefits
□Applicable √Not applicable
(4) Accounting treatment of other long-term employee benefits
□Applicable √Not applicable
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34 Lease liabilities
□Applicable √Not applicable
35 Estimated liabilities
√Applicable □Not applicable
Except for contingent consideration and contingent liabilities assumed in business combination not under the same
control, when the obligations related to contingencies meet the following conditions, the Group recognizes them as estimated
liabilities:
(1) This obligation is a present obligation of the Group;
(2) The performance of such obligation is likely to result in outflow of economic benefits from the Group;
(3) The amount of the obligation can be measured reliably.
The estimated liabilities are initially measured as the best estimate of expenses required for the performance of relevant
present obligations by considering comprehensively the risks with respect to contingencies, uncertainties and the time value
of money. On each balance sheet date, the Group shall review the book value of estimated liabilities. The Company shall
make corresponding adjustments to reflect the current best estimate if there is any conclusive evidence indicating that such
book value cannot reflect the current best estimate.
36 Share-based payment
□Applicable √Not applicable
37 Preferred shares, perpetual bonds and other financial instruments
√Applicable □Not applicable
After the maturity of the perpetual bonds issued by the Group, the Group has the right to extend them for an unlimited
number of times. For the coupon interest of the perpetual bonds, the Group has the right to postpone the payment, and the
group has no contractual obligation to pay cash or other financial assets. They are classified as equity instrument.
38 Revenue
(1) Accounting policies for revenue recognition and measurement
√Applicable □Not applicable
Revenue from contracts with customers (applicable from January 1, 2020)
The Group recognizes revenue when it fulfills the performance obligation in the contract, that is, when the customer
obtains control over the relevant goods or services. The acquisition of control of relevant goods or services means to be able
to dominate the use of the goods or the rendering of the services and obtain almost all the economic benefits from them.
Manufacturing contracts on large-sized port equipment, heavy equipment and steel structure products
The manufacturing contracts on large-sized port equipment, heavy equipment and steel structure products between
the Group and customers usually only include the performance obligations of transferring large-sized port machinery and
equipment, heavy equipment and steel structure products customized for customers.
The large-sized port equipment, heavy equipment and steel structure products provided by the Group during the
performance of the contract are irreplaceable, however, most of the large-sized port equipment, heavy equipment sales
contracts and the manufacturing contracts of some steel structure products do not stipulate that the Group has the right
to collect money for the performance part that has been completed so far in the whole contract period. This part of the
contract does not meet the performance obligation conditions within a certain period of time, and the Group takes it as
the performance obligation at a certain point of time. The Group generally recognizes the revenue at the time point of
control transfer of relevant port machinery and equipment, heavy equipment and steel structure products on the basis of
comprehensive consideration of the following factors: the current right to receive payment of goods, the transfer of main risks
and rewards in the ownership of goods, the transfer of legal ownership of goods, the transfer of physical assets of goods,
and the acceptance of the goods by customers.
In addition, based on the terms of sales contracts on individual large-sized port equipment and heavy equipment and
the manufacturing contracts on some steel structure products, the Group has the right to collect money for the performance
part that has been completed so far during the whole contract period. The Group takes it as the performance obligation to
perform in a certain period of time, and recognizes the revenue according to the performance progress. Based on input
method, the Group determines the corresponding performance progress of large-sized port equipment and heavy equipment
contracts according to the proportion of the cost incurred in the total estimated cost. By output method, the Group determines
the performance progress of the steel structure manufacturing contract according to the proportion of the accumulated
processing tons to the estimated total processing tons.
Contracts on rendering of shipping and lifting services
The service contracts between the Group and its customers mainly involve special shipping services and hoisting
services. The revenue of special shipping services rendered by the Group is recognized by time period method, and the
progress of performance obligations is determined according to the proportion of the number of days transported in the total
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estimated days of transportation. The revenue of shipping service shall be recognized when the service is completed.
Material sales contract
The material sales contract between the Group and customers usually only includes the performance obligation of
transferring spare parts and other materials. The Group generally recognizes the revenue at the time of control transfer of
relevant spare parts and other materials on the basis of comprehensive consideration of the following factors: the current
right to receive payment of goods, the transfer of main risks and rewards in the ownership of goods, the transfer of legal
ownership of goods, the transfer of physical assets of goods, and the acceptance of the goods by customers.
Rendering of building services
The building service contract between the Group and customers usually includes the performance obligation of
infrastructure construction. As the customer can control the assets under construction during the performance by the Group,
the Group takes them as the performance obligations within a certain period of time, and recognizes the revenue according
to the performance progress, except that the performance progress cannot be reasonably determined. By input method,
the Group determines the performance progress of the services based on the cost incurred. If the performance progress
cannot be reasonably determined and the cost incurred by the Group is expected to be compensated, the revenue shall be
recognized according to the cost amount incurred until the performance progress can be reasonably determined.
Build and transfer contract (BT contract)
Activities under the BT contracts usually include build and transfer. With respect to the building services provided by the
Group, during the building period, the revenue of construction service contracts is recognized in accordance with the above
accounting policies. The construction contract revenue is measured at the fair value of the consideration receivable, and the
“long-term receivables” are recognized and measured at the same time by effective interest rate method and the amortized
cost, and offset upon receipt of payment of the project owner.
Franchise contract (“BOT” contract)
The activities under BOT contract usually include build, operate and transfer. At the build stage, the contract revenue
of construction services shall be recognized in accordance with the above accounting policies for providing build service
contracts. The revenue of construction contract is measured at the fair value of the consideration received or receivable, and
the financial assets or intangible assets are recognized while the revenue is recognized as follows:
(1) Within a certain period after the completion of the infrastructure as stipulated in the contract, if the Group can
unconditionally collect a certain amount of monetary funds or other financial assets from the contract awarding party, the
financial assets are recognized at the same time as revenue;
(2) According to the contract, the Group has the right to collect fees from the service recipients within a certain period of
operation after the completion of the relevant infrastructure. However, if the amount of fees is uncertain, the right does not
constitute an unconditional right to receive cash, the Group recognizes the intangible assets while recognizing the revenue,
and amortizes it by traffic flow method or straight-line method in the period from the date of completion acceptance of the
project to the expiration of operation period and its extension period or the termination of franchise.
If the Group does not provide actual construction services but contracts infrastructure construction to other parties, the
revenue from construction services will not be recognized; they are respectively recognized as financial assets or intangible
assets according to the project price paid in the construction process as well as the contract provisions.
In the operation stage, when services are provided, recognize the corresponding revenue; Daily maintenance or
repair expenses incurred shall be recognized as current expenses. Daily maintenance or repair expenses incurred shall be
recognized as current expenses.
According to the provisions of the contract, in order to maintain a certain service capacity of the relevant infrastructure
or maintain a certain state of use before it is handed over to the contract awarding party, the current obligations undertaken
by the Group in the estimated expenses are recognized as an estimated liability.
Variable consideration
If there is variable consideration in the contract, the Group shall determine the best estimate of variable consideration
according to the expected value or the most likely amount, but the transaction price including variable consideration shall
not exceed the amount that the accumulated recognized revenue is highly unlikely to have a significant reversal when the
relevant uncertainty is eliminated. On each balance sheet date, the Group re-estimates the amount of variable consideration
to be included in the transaction price.
Warranty obligations
According to the contract and legal provisions, the Group provides quality assurance for the goods sold or the assets
built. For the guarantee type quality assurance that the goods sold to customers meet the established standards, the
Company shall perform accounting treatment in accordance with Note VII. For the service quality assurance for a separate
service provided in addition to guaranteeing that the goods sold meet the established standards, the Group shall take it as
a single performance obligation, allocate part of the transaction price to the service quality assurance according to relative
proportion of the single selling price of the goods and service quality assurance, and recognize the revenue when the
customer acquires service control right. In assessing whether quality assurance provides a separate service in addition to
ensuring that the goods sold meet established standards, the Group shall consider whether the quality assurance is legal
requirement, quality assurance period and the nature of the Group’s commitment to perform the tasks.
Principal responsible person/agent
The Group determines whether it is the principal responsible person or the agent in the transaction according to whether
81
it has the right to control the goods or services before transferring them to customers. In case the Group can control the
goods and other products before transferring them to customers, the Group shall be the principal responsible person and
recognize the revenue according to the total consideration received or receivable. Otherwise, the Group shall be the agent
and recognize the revenue according to the amount of commission fees or handling charges that it is expected to be entitled
to receive, and the amount shall be recognized according to the net amount of the total consideration received or receivable
after deducting the price payable to other relevant parties, or according to the fixed commission amount or proportion.
Contract changes
When there are changes in the sales contract or construction contract between the Group and the customer:
(1) If the contract changes increase the clearly distinguishable goods or construction services and contract price, and
the added contract price reflects the separate price of the new goods or construction services, the Group will take such
contract change as a separate contract for accounting;
(2) If the contract change does not fall under the above (1), and there is a clear distinction between the transferred
goods or construction services and the non-transferred goods or construction services on the date of contract change, the
Group will regard it as the termination of the original contract, in the meanwhile, the non-performance part of the original
contract and the changes will be incorporated into a new contract for accounting treatment;
(3) If the contract change does not fall under the above (1), and there is no clear distinction between the transferred
goods or construction services and the non-transferred goods or construction services on the date of contract change, the
Group will take the changes as an integral part of the original contract for accounting treatment. As for the impact on the
recognized revenue, the current revenue shall be adjusted on the date of contract change.
(2) Differences in revenue recognition accounting policies caused by different business models of similar businesses
□Applicable √Not applicable
39 Contract cost
√Applicable □Not applicable
The Group’s assets related to contract cost include contract performance cost and contract acquisition cost. According
to the liquidity, they are presented in inventories, other current assets and other non-current assets respectively.
If the incremental cost incurred by the Group to get the contract is expected to be recovered, it shall be recognized as
an asset as the contract acquisition cost, unless the amortization period of the asset does not exceed one year.
The cost incurred by the Group in performing the contract, which is not applicable to the specification scope of
inventories, fixed assets or intangible assets and meets the following conditions simultaneously, shall be recognized as an
asset as the contract performance cost:
(1) The cost is directly related to a current or expected contract, including direct labor, direct materials, manufacturing
expenses (or similar expenses), costs clearly borne by the customer and other costs incurred solely as a result of the
contract;
(2) The cost increases the enterprise’s resources for fulfilling its performance obligations in the future;
(3) The cost is expected to be recovered.
The Group’s assets related to contract cost are amortized on the same basis as the recognition of income related to the
assets, and are included in the current profit or loss.
If the book value of the assets related to contract cost is higher than the difference between the following two items, the
Group will make provision for impairment of the excess part and recognize it as the loss of asset impairment:
(1) The remaining consideration expected to be obtained by the enterprise due to the transfer of goods or services
related to the assets;
(2) The cost expected to be incurred for the transfer of relevant goods or services
If the factors of impairment in the previous period change later, so that the difference between (1) and (2) is higher than
the book value of the asset, the original provision for impairment of the asset shall be reversed and included in the current
profit or loss, but the book value of the asset after reversal shall not exceed the book value of the asset on the reversal date
without provision for impairment.
Revenue (applicable to 2019)
Revenue shall be recognized when related benefits are likely to flow into the Group, the amount can be reliably
calculated, and the following conditions are met synchronously.
(a) Revenue from sales of large-scale port equipment, ocean heavy equipment, product of steel structure and
construction project is recognized by the percentage-of-completion method. Please refer to Note III. 10.
(b) Revenue from ship transportation is recognized at the completion of the voyage.
(c) Income is recognized at the time of delivery for the sale of spare goods or parts and other materials.
(d) The interest income is recognized based on the time and effective interest rate for others to use the monetary funds
of the Group.
(e) The revenue from operating lease is recognized in each period under the straight-line method during the lease term.
(f) Activities under the construction and transfer of contracts usually include construction and transfer. With respect to
the construction projects for which the Group is responsible, during the construction period, in accordance with principals of
the construction contract, when the outcome can be reliably estimated, the construction contract revenue is measured at the
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fair value of the consideration receivable, with long-term receivables recognized at the same time and offset upon receipt of
payment of the project owner.
40 Government subsidies
√Applicable □Not applicable
Government subsidies shall be recognized only if the Company is able to comply with the conditions for the government
subsidies, and is likely to receive the government subsidies. If a government subsidy is a monetary asset, it shall be
measured at the amount received or receivable. If a government subsidy is a non-monetary asset, it shall be measured at its
fair value; and if its fair value cannot be obtained in a reliable way, it shall be measured at a nominal amount.
If the government subsidies shall be used for the construction or the generation in otherwise of the long-term assets as
required by the government documents, they are the assets-related government subsidies; If government documents have
no relevant provisions, and such government subsidies are based on the condition of the construction or the generation in
otherwise of the long-term assets judged on the basis of basic conditions required for obtaining such government subsidies,
they shall be deemed as the assets-related government subsidies, other government subsidies in addition to the said ones
shall be deemed as the income-related government subsidies.
Income-related government subsidies which are used to compensate for relevant costs or losses in subsequent periods
will be recognized as deferred income, and will be included in the current profit or loss or be used to write off relevant costs
in the period when relevant costs or losses are recognized.
If assets-related government subsidies are recognized as deferred income, they shall be included in profit or loss
by stages by a reasonable and systematic method within the useful lives of relevant assets. (However, the government
subsidies measured at nominal amounts are directly included in the current profit or loss); if the relevant assets are sold,
transferred, scrapped or damaged before the end of their useful lives, the undistributed balance of relevant deferred income
is transferred to the profit or loss from the current period of asset disposal.
41 Deferred income tax assets/deferred income tax liabilities
√Applicable □Not applicable
Income tax includes the income tax of the current period and deferred income tax. Except that the adjusted goodwill
arising from business combination or the deferred income tax related to transactions or events directly recognized in
shareholder’s equity shall be included in shareholder’s equity, other current income tax and deferred income tax shall be
included in current profit and loss as income tax expenses.
The current income tax liabilities or assets incurred in the current period or prior periods shall be measured by the Group
in light of the expected payable or refundable amount of income taxes according to the tax law.
Deferred income tax is accrued under the balance sheet liability method by the Group based on the temporary difference
between book value of assets and liabilities on the balance sheet date and tax base, as well as the balance between the
book value of items which have not been recognized as assets or liabilities but the tax base can be determined according to
the tax law and the tax base.
Taxable temporary differences are recognized as deferred income tax liabilities, except that:
(1) Taxable temporary differences are generated in the following transactions: the initial recognition of goodwill, or the
initial recognition of assets or liabilities arising from transactions with the following characteristics: the transaction is not
a business combination and will not affect accosting profits, nor affect the taxable income or deductible losses when the
transaction occurs.
(2) For taxable temporary differences related to the investments in subsidiaries, joint ventures and associates, the time
for the reversal of the taxable temporary differences can be controlled and the taxable temporary differences are likely not to
be reversed in the foreseeable future.
For deductible temporary differences, deductible losses and tax credits that can be carried forward to subsequent
periods, deferred tax assets arising therefrom are recognized to the extent that future taxable income will be probable to be
available against the deductible temporary differences, deductible losses and tax credits, unless the deductible temporary
differences arise from the following transactions:
(1) The deductible temporary difference is generated in the following transaction: the transaction is not a business
combination and it will affect neither accounting profits nor the taxable income (or deductible losses) when occurred.
(2) For the deductible temporary differences arising from investments in subsidiaries, associates and joint ventures,
the deferred income tax assets will be accordingly recognized when meeting the following conditions at the same time:
the temporary differences may be reversed in the foreseeable future and they can be used to offset the taxable income of
deductible temporary differences in the future.
On the balance sheet date, the Company shall measure deferred income tax assets and deferred income tax liabilities
at the applicable tax rate during the period for expected recovery of assets or settlement of liabilities and reflect the impacts
of the income tax by means of expected recovery of assets or settlement of liabilities on the balance sheet date.
On the balance sheet date, the Group reviews the book value of deferred income-tax assets. If it is unlikely to obtain
sufficient taxable income to offset the benefit of the deferred income-tax assets, the book value of the deferred income-tax
assets will be written down. On the balance sheet date, the Group re-evaluates unrecognized deferred income tax assets,
83
and deferred income tax assets are recognized to the extent that it is likely to obtain sufficient taxable income for all or part
of the deferred income tax assets to be reversed.
Deferred income tax assets and deferred income tax liabilities meeting the following conditions simultaneously will be
presented by net amount after offset: when the Company has the statutory right to balance current income tax assets and
current income tax liabilities with net amounts, and deferred income tax assets and deferred income tax liabilities are related
to the income tax which are imposed on the same taxpayer by the same tax collection authority or on different taxpayers,
but, in each important future period in connection with the reversal of deferred income tax assets and liabilities, the involved
taxpayer intends to settle the current income tax assets and liabilities on a net amount basis, or obtain assets at the time of
discharging liabilities.
42 Lease
(1) Accounting treatment methods of operating lease
√Applicable □Not applicable
Lease under which all the risks and rewards related to the ownership of assets are materially transferred is recognized
as financing lease, with the rest as operating lease.
As the leasee of operating lease
Rental payment for operating lease in each stage during the rental period should be included into related asset costs or
the current profit or loss by the straight-line method;
As a lessor of operating lease
Rental income from the operating lease in each stage during the lease term should be recognized as the current profit
or loss by the straight-line method.
(2) Accounting treatment methods of finance lease
√Applicable □Not applicable
As the lessee of finance lease
At the commencement of the lease term, assets acquired under finance lease shall be recorded at the lower of their fair
values and the present values of the minimum lease payments, and the Company shall recognize the book value of long-
term payables at the minimum lease payments, and shall record the differences between book value of the leased assets
and the long-term payables as unrecognized finance charges, which are amortized at the effective interest method in each
stage during the lease term. The contingent rental is included in the current profits or losses when actually occurring.
Leaseback
Leaseback for financing purposes will be treated as a whole, which is accounted by mortgage loan, on the condition that
asset sale is related to lease transaction and can be repurchased when the lease term expires, that is to say, the accounting
treatment shall be conducted as per mortgage loan.
(3) Determination and accounting treatment methods of lease under the new lease standard
□Applicable √Not applicable
43 Other accounting policies and accounting estimates
√Applicable □Not applicable
1.Profit distribution
The Company's cash dividends are recognized as liabilities after approval at the general meeting.
2.Work safety expenses
The Company withdraws the work safety expenses according to provisions, includes them in the cost of related products
or the current profit or loss, and includes them in special reserves at the same time. The costs are handled separately
depending on whether they form fixed assets: when withdrawn work safety expenses are used within the prescribed
range and belong to expenses, such costs shall be directly deducted from special reserves; where a fixed asset is formed,
the expenses incurred through collection are recognized as the fixed asset when it is ready for its intended use, and the
equivalent special reserve is written off and the equivalent accumulated depreciation is confirmed.
3.Fair value measurement
The Group measures the derivative financial instruments and equity instrument investment at fair value on each
balance sheet date. Fair value is the price received from sales of an asset or paid for transfer of a liability by a market
participant in an orderly transaction on the measurement date. The Group measures the relevant assets or liabilities at
fair value, assuming that the sale of assets or transfer of liabilities is orderly carried out in the main market of the relevant
assets or liabilities. Where there is no main market, the Group should assume that the transaction is carried out in the most
advantageous market related to the assets or liabilities. The main market (or the most advantageous market) is the trading
market that can be entered by the Company on the measurement date. The Group adopts the assumption used for realizing
its utmost economic benefit when the market participants price the asset or liability.
84
2020
When the Company measures non-financial assets at fair value, it should consider a market participant’s ability to
generate economic benefit by using the asset or by selling it to another market participant who will use the asset in its
highest and best use.
When the Group uses the valuation techniques, it has considered the valuation techniques that are applicable in the
current situation and are supported by enough available data and other information. The Company gives priority to the
observable inputs when using valuation techniques, and those unobservable inputs are used only under the circumstance
when it is impossible or unobservable inputs to obtain relevant observable inputs.
For assets and liabilities measured at or disclosed by their fair value in the financial statements, the level of the
measurement result of fair value shall subject to the lowest level which the input having great significance to the entire
measurement of fair value belongs to: Level 1 inputs refer to quoted prices (unadjusted) in active markets for identical assets
or liabilities available on the measurement date; Level 2 inputs refer to inputs that are directly or indirectly observable for the
assets or liabilities other than Level 1 inputs; Level 3 inputs refer to unobservable inputs of the relevant assets or liabilities.
On each balance sheet date, the Group reevaluates the assets and liabilities continuously measured at fair value and
recognized in the financial statements in order to determine whether there is a conversion among the levels of fair value
measurement.
4.Significant accounting judgment and estimate
The preparation of financial statements requires the management to make judgments, estimates and assumptions.
These judgments, estimates and assumptions will affect the reported amounts and disclosures of income, expenses, assets
and liabilities, and the disclosure of contingent liabilities on the balance sheet date. The results from the uncertainties of
these assumptions and estimates may lead to significant adjustments to the book amount of assets or liabilities that are
affected in the future.
Judgment
Determination of the performance progress of construction contracts (only applicable to transfer of control over a period
of time)
The Group determines the performance progress of the construction contracts by input method. To be more specific,
the Group determines the performance progress according to the proportion of the cumulative actual construction cost
to the estimated total cost, while the cumulative actual cost includes the direct cost and indirect cost in the process of
transferring goods to customers. The Group believes that the construction contract price with customers is determined on
the basis of construction cost, and the proportion of the actual construction cost to the estimated total cost can truly reflect
the performance progress of construction services. In view of the long duration of construction contracts, which may span
several accounting periods, the Group will recheck and revise the budget with the progress of the construction contracts, and
adjust the amount of revenue recognized accordingly.
Uncertainty of estimation
The following are other key sources of the uncertainty of the key assumptions and estimates in the future on the balance
sheet date, which may lead to major adjustments in the book value of the assets and liabilities of next fiscal year.
Impairment of financial instruments and contract assets
The Group adopts the expected credit loss model to assess the impairment of financial instruments and contract
assets. The application of the expected credit loss model requires significant judgments and estimates. It must consider
all reasonable and evidence-based information, including forward-looking information. In making such judgments and
estimates, the Group infers expected changes in debtors' credit risk based on historical repayment data combined with
economic policies, macroeconomic indicators, industry risks and other factors. Different estimates may affect the provision
for impairment, and the amount of impairment that has been provided may be not equal to the actual amount of future
impairment losses.
Inventory impairments
The management shall estimate the net realizable value of inventories in time so as to estimate the provision for
depreciation of inventories. If any event or circumstance changes, it is necessary to use the estimate to make the provision
for depreciation of inventories if the inventory is not likely to realize the relevant value. If the expected amount is different
from the original estimate, the relevant difference will affect the book value of the inventories and the impairment loss during
the estimated change.
Impairment of non-current assets other than financial assets (other than goodwill)
On the balance sheet date, the Group judges whether there are any signs of possible impairment of non-current
assets other than financial assets. Non-current assets other than financial assets are tested for impairment when there is
an indication showing that their book amounts are irrecoverable. When the book value of an asset or asset group is higher
than the recoverable amount, that is, the higher of the net amount from fair value less the disposal expense and the present
value of the estimated future cash flow, it indicates that the impairment occurred. The net amount after the fair value minus
the disposal expenses is determined by reference to the sales agreement price of similar assets in the fair trade or the
observable market price, minus the incremental cost directly attributable to the disposal of the asset. When estimating the
present value of future cash flows, management must estimate the expected future cash flows of the asset or asset group
and select an appropriate discount rate to determine the present value of future cash flows.
85
Impairment of goodwill
The Group tests whether the goodwill is impaired at least annually. This requires an estimate of the present value of
the future cash flows of the asset group or combination of asset groups to which goodwill is allocated. When estimating
the present value of future cash flows, the Group needs to estimate the cash flow generated by future asset groups or
combination of asset groups, and select the appropriate discount rate to determine the present value of future cash flows.
See Note VII (28) for details.
Fair value of unlisted equity investments
The valuation of unlisted equity investments is an estimated future cash flow discounted at the current discount rate
of other financial instruments with similar contract terms and risk characteristics. This requires the Group to estimate the
expected future cash flow, credit risk, fluctuation and discount rate; therefore, there is some uncertainty.
44 Changes in significant accounting policies and accounting estimates
(1) Changes in significant accounting policies
√Applicable □Not applicable
The contents
and reasons of Remarks (the name and amount of the statement items
Examination and approval procedures
the changes of which subject to important influence)
accounting policy
The new revenue standard establishes a new revenue
recognition model for regulating the revenue generated by
contracts with customers. According to the new revenue
standard, the way of revenue recognition should reflect the
mode of the entity transferring goods or providing services
to customers, and the amount of revenue should reflect the
amount of consideration that the entity is expected to be entitled
to due to the transfer of such goods and services to customers.
In the meanwhile, the new revenue standard also regulates the
judgment and estimation of every link of revenue recognition.
The new revenue standard requires that, on the enforcement
date of the contract, the subject should evaluate the contract,
identify the individual performance obligations contained in the
contract, and determine whether the individual performance
obligations are performed within a certain period of time or at
a certain point of time. If one of the following conditions is met,
In 2017, the Ministry of Finance issued the the performance obligation shall be performed within a certain
revised “Accounting Standard for Business period of time; otherwise, the performance obligation shall be
Enterprises No.14 – Revenue” (hereafter performed at a certain point of time: (I) The customer acquires
referred to as “new revenue standard”). The and consumes the economic benefits brought by the enterprise’s
Group has been made accounting treatment performance at the same time of the enterprise’s performance;
according to the new standards since January (II) The customer can control the goods or services under
New revenue
1, 2020. According to the convergence construction during the performance of the contract by the
standard
provisions, the information of the comparable enterprise; (III) The goods or services produced in the process of
period will not be adjusted, and the difference performance have irreplaceable uses, and the enterprise has the
between the first day implementation of the right to collect payment for the performance part that has been
new standards and the current standards is completed so far throughout the contract period. The Group only
retroactively adjusted to the retained earnings adjusts the cumulative impact of contracts not yet completed
at the beginning of 2020. on January 1, 2020. For the contract changes before January
1, 2020, the Group shall adopt the simplified treatment method
for accounting treatment according to the final arrangement
after the contract change and the relevant provisions of the new
standard. For large-sized port machinery, heavy equipment
and steel structure products manufacturing business, the
Group recognized the revenue by the completion percentage of
construction contract before January 1, 2020. From January 1,
2020, after analysis by the Group, the performance obligations
contained in the contracts of large-sized port machinery, heavy
equipment and some steel structure products manufacturing did
not meet the above conditions for performance obligations within
a certain period of time, therefore, based on the comprehensive
consideration of various factors, the revenue was recognized
at the time of control transfer of related products. The above
changes resulted in the adjustment of the balance sheets of the
Group and the Company as at January 1, 2020.
Other description
86
2020
The main impacts of the adjustments caused by the above changes in accounting policies on the financial statements
are as follows:
The Group
2020
Book value Impact of new revenue standard Book value
December 31, 2019 Reclassification Remeasurement January 1, 2020
Accounts receivable 4,966,175,528 - 3,539,747,960 8,505,923,488
Other receivables 1,176,561,508 - 34,480,793 1,211,042,301
Inventories 8,561,251,580 12,434,158,624 76,838,858 21,072,249,062
Outstanding payments for
12,434,158,624 (12,434,158,624) - -
construction completed
Contract assets - - 987,717,554 987,717,554
Deferred income tax assets 486,197,635 - 282,425,445 768,623,080
Other non-current assets 161,337,287 - 899,448,701 1,060,785,988
Advances from customers (822,987,986) 656,237,558 - (166,750,428)
Contract liabilities - (2,336,188,437) (7,404,631,245) (9,740,819,682)
Amount settled for uncompleted work (1,679,950,879) 1,679,950,879 - -
Other current liabilitie - - (30,770,358) (30,770,358)
Surplus reserves (1,761,198,709) - 143,572,545 (1,617,626,164)
Undistributed profits (3,651,851,383) - 1,399,694,619 (2,252,156,764)
Minority equity (3,027,632,431) - 71,475,128 (2,956,157,303)
The Company
2020
Book value Impact of new revenue standard Book value
December 31, 2019 Reclassification Remeasurement January 1, 2020
Accounts receivable 11,188,977,446 - 3,208,920,449 14,397,897,895
Other receivables 7,850,320,715 - 34,480,793 7,884,801,508
Inventories 8,605,357,557 7,399,709,689 99,402,083 16,104,469,329
Outstanding payments for
7,399,709,689 (7,399,709,689) - -
construction completed
Contract assets - - 817,100,259 817,100,259
Deferred income tax assets 461,638,248 - 250,834,238 712,472,486
Other non-current assets - - 899,448,701 899,448,701
Advances from customers (490,409,652) 490,409,652 - -
Contract liabilities - (2,543,435,528) (6,745,911,977) (9,289,347,505)
Amount settled for uncompleted work (2,053,025,876) 2,053,025,876 - -
Surplus reserves (1,760,690,436) - 143,572,545 (1,617,117,891)
Undistributed profits (3,835,099,435) - 1,292,152,909 (2,542,946,526)
(2) Changes in accounting estimates
□Applicable √Not applicable
(3) The first implementation of new revenue standard and new lease standard for the adjustment of the financial
statements at the beginning of the first execution year since 2020
√Applicable □Not applicable
87
Consolidated Balance Sheet
Unit: Yuan Currency: CNY
Item December 31, 2019 January 1, 2020 Adjustments
Current assets:
Monetary funds 3,310,297,451 3,310,297,451
Settlement provisions
Lending funds
Held-for-trading financial assets 1,739,792,062 1,739,792,062
Derivative financial assets
Notes receivable 5,650,000 5,650,000
Accounts receivable 4,966,175,528 8,505,923,488 3,539,747,960
Receivables financing 406,408,604 406,408,604
Advances to suppliers 935,878,777 935,878,777
Premiums receivable
Reinsurance accounts receivable
Reserves for reinsurance contract receivable
Other receivables 1,176,561,508 1,211,042,301 34,480,793
Including: Interest receivable - -
Dividend receivable 1,072,390 1,072,390
Financial assets purchased under agreements to resell
Inventories 8,561,251,580 21,072,249,062 12,510,997,482
Outstanding payments for construction completed 12,434,158,624 - -12,434,158,624
Contract assets 987,717,554 987,717,554
Assets held for sale
Non-current assets due within one year 1,313,203,581 1,313,203,581
Other current assets 720,183,574 720,183,574
Total current assets 35,569,561,289 40,208,346,454 4,638,785,165
Non-current assets:
Disbursement of loans and advances
Debt investment
Other debt investments
Long-term receivables 5,227,728,420 5,227,728,420
Long-term equity investments 2,873,673,745 2,873,673,745
Other equity instrument investment 61,981,268 61,981,268
Other non-current financial assets
Investment properties 418,425,533 418,425,533
Fixed assets 21,454,967,299 21,454,967,299
Construction in progress 4,380,489,888 4,380,489,888
Productive biological assets
Oil and gas assets
Right-of-use assets
Intangible assets 3,506,541,366 3,506,541,366
Development expenditures
Goodwill 268,434,934 268,434,934
Long-term deferred expenses 1,444,636 1,444,636
88
2020
Item December 31, 2019 January 1, 2020 Adjustments
Deferred income tax assets 486,197,635 768,623,080 282,425,445
Other non-current assets 161,337,287 1,060,785,988 899,448,701
Total non-current assets 38,841,222,011 40,023,096,157 1,181,874,146
Total assets 74,410,783,300 80,231,442,611 5,820,659,311
Current liabilities:
Short-term borrowings 22,001,319,380 22,001,319,380
Borrowings from the Central Bank
Borrowing funds
Held-for-trading financial liabilities 7,312,741 7,312,741
Derivative financial liabilities
Notes payable 3,420,945,451 3,420,945,451
Accounts payable 7,869,378,365 7,869,378,365
Advances from customers 822,987,986 166,750,428 -656,237,558
Contract liabilities 9,740,819,682 9,740,819,682
Amount settled for uncompleted work 1,679,950,879 - -1,679,950,879
Financial assets sold for repurchase
Deposits from customers and interbank
Acting trading securities
Acting underwriting securities
Payroll payable 329,978,281 329,978,281
Tax payable 144,506,742 144,506,742
Other payables 711,389,996 711,389,996
Including: Interest payable
Dividends payable 31,701,965 31,701,965
Fees and commissions payable
Dividend payable for reinsurance
Liabilities held for sale
Non-current liabilities due within a year 7,287,484,513 7,287,484,513
Other current liabilities 30,770,358 30,770,358
Total current liabilities 44,275,254,334 51,710,655,937 7,435,401,603
Non-current liabilities:
Reserve fund for insurance contracts
Long-term borrowings 8,413,339,986 8,413,339,986
Bonds payable
Including: preferred stock
Perpetual bond
Lease liabilities
Long-term payables 1,741,945,636 1,741,945,636
Long-term payroll payable
Estimated liabilities 484,000,772 484,000,772
Deferred income 458,722,579 458,722,579
Deferred income tax liabilities 89,856,727 89,856,727
Other non-current liabilities 376,626,821 376,626,821
89
Item December 31, 2019 January 1, 2020 Adjustments
Total non-current liabilities 11,564,492,521 11,564,492,521
Total liabilities 55,839,746,855 63,275,148,458 7,435,401,603
Owners’ equity (or shareholders’ equity):
Paid-in capital (or share capital) 5,268,353,501 5,268,353,501
Other equity instruments
Including: preferred stock
Perpetual bond
Capital reserves 4,834,854,332 4,834,854,332
Less: treasury stock
Other comprehensive income 23,530,451 23,530,451
Special reserves 3,615,638 3,615,638
Surplus reserves 1,761,198,709 1,617,626,164 -143,572,545
General risk preparation
Undistributed profits 3,651,851,383 2,252,156,764 -1,399,694,619
Total owners' equities attributable to the owners of parent
15,543,404,014 14,000,136,850 -1,543,267,164
company
Minority equity 3,027,632,431 2,956,157,303 -71,475,128
Total owners’ equity (or shareholders' equity) 18,571,036,445 16,956,294,153 -1,614,742,292
Total liabilities and owners’ equity (or shareholders'
74,410,783,300 80,231,442,611 5,820,659,311
equity)
Notes to the adjustment of each item:
□Applicable √Not applicable
Balance Sheet of the Parent Company
Unit: Yuan Currency: CNY
Item December 31, 2019 January 1, 2020 Adjustments
Current assets:
Monetary funds 2,009,711,462 2,009,711,462
Held-for-trading financial assets 717,766,887 717,766,887
Derivative financial assets
Notes receivable 5,650,000 5,650,000
Accounts receivable 11,188,977,446 14,397,897,895 3,208,920,449
Receivables financing 372,373,708 372,373,708
Advances to suppliers 2,516,366,730 2,516,366,730
Other receivables 7,850,320,715 7,884,801,508 34,480,793
Including: Interest receivable
Dividend receivable
Inventories 8,605,357,557 16,104,469,329 7,499,111,772
Outstanding payments for construction completed 7,399,709,689 - -7,399,709,689
Contract assets 817,100,259 817,100,259
Assets held for sale
Non-current assets due within one year 16,068,800 16,068,800
Other current assets 242,069,645 242,069,645
Total current assets 40,924,372,639 45,084,276,223 4,159,903,584
90
2020
Item December 31, 2019 January 1, 2020 Adjustments
Non-current assets:
Debt investment
Other debt investments
Long-term receivables 349,516,318 349,516,318
Long-term equity investments 8,748,485,729 8,748,485,729
Other equity instrument investment 61,981,268 61,981,268
Other non-current financial assets
Investment properties 418,425,533 418,425,533
Fixed assets 4,484,852,694 4,484,852,694
Construction in progress 352,334,608 352,334,608
Productive biological assets
Oil and gas assets
Right-of-use assets
Intangible assets 1,537,053,308 1,537,053,308
Development expenditures
Goodwill
Long-term deferred expenses
Deferred income tax assets 461,638,248 712,472,486 250,834,238
Other non-current assets 899,448,701 899,448,701
Total non-current assets 16,414,287,706 17,564,570,645 1,150,282,939
Total assets 57,338,660,345 62,648,846,868 5,310,186,523
Current liabilities:
Short-term borrowings 16,511,846,099 16,511,846,099
Held-for-trading financial liabilities
Derivative financial liabilities
Notes payable 4,115,677,123 4,115,677,123
Accounts payable 4,097,874,390 4,097,874,390
Advances from customers 490,409,652 - -490,409,652
Contract liabilities 9,289,347,505 9,289,347,505
Amount settled for uncompleted work 2,053,025,876 - -2,053,025,876
Payroll payable 312,443,598 312,443,598
Tax payable 24,536,759 24,536,759
Other payables 1,223,412,212 1,223,412,212
Including: Interest payable - -
Dividends payable 352,598 352,598
Liabilities held for sale
Non-current liabilities due within one year 5,454,698,322 5,454,698,322
Other current liabilities
Total current liabilities 34,283,924,031 41,029,836,008 6,745,911,977
Non-current liabilities:
Long-term borrowings 6,446,433,319 6,446,433,319
Bonds payable
Including: preferred stock
Perpetual bond
91
Item December 31, 2019 January 1, 2020 Adjustments
Lease liabilities
Long-term payables
Long-term payroll payable
Estimated liabilities 470,724,247 470,724,247
Deferred income 329,345,661 329,345,661
Deferred income tax liabilities
Other non-current liabilities 21,272,925 21,272,925
Total non-current liabilities 7,267,776,152 7,267,776,152
Total liabilities 41,551,700,183 48,297,612,160 6,745,911,977
Owners’ equity (or shareholders’ equity):
Paid-in capital (or share capital) 5,268,353,501 5,268,353,501
Other equity instruments
Including: preferred stock
Perpetual bond
Capital reserves 4,914,468,683 4,914,468,683
Less: treasury stock
Other comprehensive income 8,348,107 8,348,107
Special reserves
Surplus reserves 1,760,690,436 1,617,117,891 -143,572,545
Undistributed profits 3,835,099,435 2,542,946,526 -1,292,152,909
Total owners’ equity (or shareholders' equity) 15,786,960,162 14,351,234,708 -1,435,725,454
Total liabilities and owners’ equity (or shareholders'
57,338,660,345 62,648,846,868 5,310,186,523
equity)
Notes to the adjustment of each item:
□Applicable √Not applicable
(4) Description of the retrospective adjustment of previous comparative data under the initial implementation of new
revenue standard and new lease standard since 2020
□Applicable √Not applicable
45 Others
□Applicable √Not applicable
VI. Taxes
1 Main tax categories and tax rates
Main tax categories and tax rates
√Applicable □Not applicable
Category of tax Basis of tax computation Tax rate
The taxable income from the sales of the products in domestic market is subject
to the output tax as per 13%; the products for export adopt the method of “tax
exemption, tax deduction and tax reimbursement” and the applicable tax rate is
13%. The Group’s income from the marine transport is applicable to VAT, and
the output tax is calculated as per 9%; the income from leasing of the equipment
VAT is applicable to the is applicable to VAT and the output tax is calculated as per 13% of the taxable
VAT sales of the Group’s income; the income from the sales of the equipment is applicable to the simple
products collection measures of VAT and the tax rate is subject to the reduced tax rate
of 2%; the Group’s income from the leasing of the housing is applicable to the
simple collection measures of VAT and the tax rate is 5%; the item “B-T” is
applicable to VAT and the output tax on the taxable income is collected at 9%.
The above output tax shall calculate and pay VAT after deducting the amount of
input tax deductible, except for the applicable VAT’s simple collection method.
92
2020
Category of tax Basis of tax computation Tax rate
Consumption tax / /
Sales tax / /
Urban maintenance and Calculated and paid according to 7% and 3% of the actual turnover tax paid
VAT paid
construction tax respectively.
The enterprise income tax is calculated and paid in accordance with the Enterprise
Income Tax Law of People’s Republic of China (hereinafter referred to as the
The enterprise income
“Income Tax Law”). In accordance with relevant regulations in the Administrative
tax is calculated and paid
Measures for Certification of New and High Technology Enterprises (GKFH [2016]
in accordance with the
No.32), the Guidelines for the Administration of Qualification Accreditation of
Enterprise Income Tax Law
Enterprise income tax High-tech Enterprises (GKFH [2016] No.195), and the Circular on Announcing
of People’s Republic of
the Recognition List of the Second Batch of High-tech Enterprises of Shanghai in
China (hereinafter referred
2017, the Company was awarded the High-tech Enterprise Certificate (Certificate
to as the “Income Tax
Number: GR201831002345) in November 2017 with the valid term of 3 years.
Law”).
The application for new certificate in 2020 has been publicized. The Company
actually applied the enterprise income tax rate of 15% this year (2019: 15%).
Where there are taxpayers with different enterprise income tax rates, the disclosure shall be stated
√Applicable □Not applicable
Name of taxpayer Income tax rate (%)
The Company 15%
Shanghai Zhenhua Port Machinery Heavy Industries Co., Ltd. 25%
Shanghai Zhenhua Port Machinery (Hong Kong) Co., Ltd. 16.50%
Shanghai Zhenhua Shipping Co., Ltd 25%
Nantong Zhenhua Heavy Equipment Manufacturing Co., Ltd. 25%
Shanghai Zhenhua Heavy Industries Group (Nantong) Transmitter Co., Ltd. 15%
ZPMC Electric Co., Ltd. 15%
Shanghai Zhenhua Ocean Engineering Service Co., Ltd 25%
ZPMC Machinery Equipment Services Co., Ltd. 25%
Shanghai Zhenhua Heavy Industries Port Machinery General Equipment Co., Ltd. 25%
Shanghai Port Machinery Heavy Industry Co., Ltd 25%
ZPMC Zhangjiagang Port Machinery Co., Ltd. 25%
ZPMC Qidong Marine Engineering Co., Ltd. 25%
Jiahua Shipping Co., Ltd. 16.50%
Zhenhua Pufeng Wind Energy (HongKong) Co., Ltd. 16.50%
CCCC Tianhe Mechanical Equipment Manufacturing Co., Ltd 15%
Nanjing Ninggao New Channel Construction Co., Ltd 25%
CCCC Investment & Development Qidong Co., Ltd. 25%
CCCC Liyang Urban Investment and Construction Co., Ltd. 25%
CCCC (Huaian) Construction Development Co., Ltd. 25%
CCCC Zhenjiang Investment Construction Management Development Co., Ltd. 25%
CCCC Rudong Construction Development Co., Ltd. 25%
ZPMC Netherlands Coperatie U.A. 25%
ZPMC Netherlands B.V. 25%
Verspannen B.V. 25%
ZPMC Espana S.L. 30%
ZPMC Italia S.r.l 24%
ZPMC GmbH Hamburg 32.25%
ZPMC Lanka Company (Private) Limited 24%
93
Name of taxpayer Income tax rate (%)
ZPMC North America Inc. 8.84%
ZPMC Korea Co., Ltd. 20%
ZPMC Engineering Africa (Pty) Ltd. 28%
ZPMC Engineering (India) Private Limited 22%
ZPMC Southeast Asia Holding Pte. Ltd. 17%
ZPMC Engineering (Malaysia) Sdn. Bhd. 24%
ZPMC Australia Company (Pty) Ltd. 30%
ZPMC Brazil Servio Portuários LTDA 25%
ZPMC Limited Liability Company 20%
ZPMC NA East Coast lnc. 8.84%
ZPMC Middle East FZE 0%
ZPMC UK LD 20%
Greenland Heavylift (Hong Kong) Limited 16.5%
GPO Grace Limited 0%
GPO Amethyst Limited 0%
GPO Sapphire Limited 0%
GPO Emerald Limited 0%
GPO Heavylift Limited 0%
GPO Heavylift AS 0%
GPO Heavylift Pte Ltd 17%
ZPMC Latin America Holding Corporation 25%
Terminexus Co., Ltd. 16.5%
CCCC Yongjia Construction Development Co., Ltd. 25%
CCCC Zhenhua Lvjian Technology (Ningbo) Co., Ltd. 25%
ZPMC Hotel Co., Ltd. 25%
Xiong’an Zhenhua Co., Ltd. 25%
ZPMC Fuzhou Offshore Construction Co., Ltd. 25%
CCCC (Dongming) Investment and Construction Co., Ltd. 25%
Remark 1: Shanghai Zhenhua Heavy Industries Group (Nantong) Heavy Gear Reducer Co., Ltd won the Hi-tech
Enterprise Certificate (No. GR201932001426) in 2019, with the valid term of 3 years. Shanghai Zhenhua Port Machinery
Heavy Industries Co., Ltd. was recognized as a hi-tech enterprise in December, 2019 and won the Hi-tech Enterprise
Certificate (No.: GR201931004259) with the valid term of 3 years. The company's tax rate was 15% last year and 15% this
year. Shanghai Zhenhua Heavy Industries Electric Co., Ltd was recognized as a hi-tech enterprise in November, 2017 and
won the Hi-tech Enterprise Certificate (No.: GR202031001911) after reexamination in November, 2020, with the valid term
of 3 years. CCCC Tianhe Mechanical Equipment Manufacturing Co., Ltd. was recognized as hi-tech enterprise in August,
2015 and won the Hi-tech Enterprise Certificate (No. GR201832001451) after reexamination in 2018, with the valid term of 3
years. In accordance with relevant provisions in Article 28 of the Income Tax Law, the actually applicable enterprise income
tax rate for these companies in this year was 15% (2019: 15%).
2 Tax preferences
□Applicable √Not applicable
3 Others
□Applicable √Not applicable
VII.Notes to the main items of the consolidated financial statements
1 Monetary funds
√Applicable □Not applicable
94
2020
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Cash on hand 1,063,472 1,469,655
Bank deposits 2,896,678,868 3,066,555,321
Other monetary funds 50,332,396 242,272,475
Total 2,948,074,736 3,310,297,451
Including: total amount of overseas deposits 829,760,121 888,185,684
As at December 31, 2020, the other monetary funds, including the restricted deposit of RMB 50,332,396 (as at
December 31, 2019: RMB 242,272,475), were the money appropriated that was collected from the overseas projects and
deposited in the overseas regulatory accounts and the cash deposit deposited for application to the bank for the letter of
credit and letter of guarantee.
As at December 31, 2020, the overseas monetary fund deposited by the Group was RMB 829,760,121 (Dec. 31, 2019:
RMB 888,185,684).
As at December 31, 2020, the bank deposits were current deposits. The interest income from current deposits is
calculated as per the interest rate of the current deposits.
2 Held-for-trading financial assets
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Financial assets measured at fair value
1,601,623,650 1,739,792,062
through the current profit or loss
Including:
Equity instrument investment
Derivative financial assets – equity options 8,438,278 8,438,278
Investments in shares of listed companies 1,593,185,372 1,709,118,540
Derivative financial assets – forward foreign
22,235,244
exchange contracts and options
Financial assets designated to be measured
at fair value through the current profit or loss
Including:
Total 1,601,623,650 1,739,792,062
Other description:
√Applicable □Not applicable
(i) As at December 31, 2020, the held-for-trading financial assets - derivative financial assets – equity options held by
the Group refers to the fair value of the right obtained at the time of acquiring Greenland Heavylift (Hong Kong) Limited to
purchase 1% of its equity of at the price of USD 1.
(ii) As at December 31, 2020, the listed company share investments held by the Group include 5.88% equity of Jiangxi
Huawu Brake Co., Ltd., 1.59% equity of Qingdao Port International Co., Ltd., 1.16% equity of CRSC, 0.45% equity of
COSCO Shipping Holdings Co., Ltd. and 0.001% equity of Shenwan Hongyuan Group Co., Ltd.
3 Derivative financial assets
□Applicable √Not applicable
4 Notes receivable
(1) Presentation of notes receivable by category
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Commercial acceptance bill 753,000 5,650,000
Total 753,000 5,650,000
95
(2) Notes receivable pledged by the Company at the end of the period
□Applicable √Not applicable
(3) Notes receivable endorsed or discounted by the Company at the end of the period and not yet due on the balance
sheet date
□Applicable √Not applicable
(4) Notes transferred to accounts receivable by the Company at the end of the period due to drawer’s failure in
performance
□Applicable √Not applicable
(5) Disclosure by bad debt calculation method
□Applicable √Not applicable
Individual provision for bad debts:
□Applicable √Not applicable
Provision for bad debts by portfolio:
□Applicable √Not applicable
If the provision for bad debts is calculated based on the general model of expected credit loss, please refer to other
receivables for disclosure:
□Applicable √Not applicable
(6) Provision for bad debts
□Applicable √Not applicable
(7) Notes receivable actually written off in the current period
□Applicable √Not applicable
Other description
□Applicable √Not applicable
5 Accounts receivable
(1) Disclosure by aging
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Aging December 31, 2020
Within 1 year
Including: subitem within 1 year
Sub-total of items within 1 year 6,178,309,160
1- 2 years 1,012,042,953
2- 3 years 314,526,234
Over 3 years
3- 4 years 177,871,594
4- 5 years 334,395,800
Over 5 years 1,084,691,181
Total 9,101,836,922
(2) Disclosure by bad debt calculation method
√Applicable □Not applicable
Unit: Yuan Currency: CNY
December 31, 2020
Book balance Provision for bad debts
Category
Proportion Proportion of Book value
Amount Amount
(%) provision (%)
Provision for bad debts accrued on
660,986,510 7 529,388,510 80 131,598,000
an individual basis
Including:
Provision for bad debts by portfolio 8,440,850,412 93 1,345,383,157 16 7,095,467,255
Including
Total 9,101,836,922 / 1,874,771,667 / 7,227,065,255
96
2020
December 31, 2019
Book balance Provision for bad debts
Category
Proportion Proportion of Book value
Amount Amount
(%) provision (%)
Provision for bad debts accrued on
753,396,385 7 591,042,385 78 162,354,000
an individual basis
Including:
Provision for bad debts by portfolio 9,529,023,401 93 1,185,453,913 12 8,343,569,488
Including
Total 10,282,419,786 / 1,776,496,298 / 8,505,923,488
Individual provision for bad debts:
√Applicable □Not applicable
Unit: Yuan Currency: CNY
December 31, 2020
Name Provision for bad Proportion of
Book balance Reason for provision
debts provision (%)
Accounts receivable 1 277,613,400 146,015,400 53 Counterparty financial shortage
Accounts receivable 2 187,863,245 187,863,245 100 Contract dispute
Accounts receivable 3 93,954,000 93,954,000 100 Counterparty financial shortage
Accounts receivable 4 42,979,947 42,979,947 100 Contract dispute
Accounts receivable 5 26,099,665 26,099,665 100 Contract dispute
Accounts receivable 6 11,037,000 11,037,000 100 Contract dispute
Accounts receivable 7 8,103,043 8,103,043 100 Contract dispute
Accounts receivable 8 6,980,371 6,980,371 100 Contract dispute
Accounts receivable 9 3,300,179 3,300,179 100 Contract dispute
Accounts receivable 10 2,236,498 2,236,498 100 Contract dispute
Accounts receivable 11 819,162 819,162 100 Contract dispute
Total 660,986,510 529,388,510 80 /
Description of individual provision for bad debts:
√Applicable □Not applicable
As at December 31, 2019, the accounts receivables with individual provision for bad debts are as follows:
Provision for bad Estimated credit
Book balance Reason for provision
debts loss ratio %
Accounts receivable 1 324,708,000 162,354,000 50 Counterparty financial shortage
Accounts receivable 2 182,958,900 182,958,900 100 Contract dispute
Accounts receivable 3 158,184,500 158,184,500 100 Counterparty financial shortage
Accounts receivable 4 27,904,870 27,904,870 100 Contract dispute
Accounts receivable 5 26,911,147 26,911,147 100 Contract dispute
Accounts receivable 6 10,748,869 10,748,869 100 Contract dispute
Accounts receivable 7 7,815,500 7,815,500 100 Contract dispute
Accounts receivable 8 7,463,174 7,463,174 100 Contract dispute
Accounts receivable 9 3,582,135 3,582,135 100 Contract dispute
Accounts receivable 10 2,224,013 2,224,013 100 Contract dispute
Accounts receivable 11 895,277 895,277 100 Contract dispute
Total 753,396,385 591,042,385
97
Provision for bad debts by portfolio:
□Applicable √Not applicable
If the provision for bad debts is calculated based on the general model of expected credit loss, please refer to other
receivables for disclosure:
□Applicable √Not applicable
(3) Provision for bad debts
□Applicable √Not applicable
The recovered or reversed provision for bad debts with significant amount:
□Applicable √Not applicable
(4) Accounts receivable actually written off in the current period
□Applicable √Not applicable
(5) Top 5 accounts receivable in terms of ending balance presented by debtor
√Applicable □Not applicable
As at December 31, 2020, top 5 accounts receivable in terms of ending balance presented by debtor summarized and
analyzed as follows:
Proportion in total balance of
Balance Provision for bad debts
accounts receivable %
Total accounts receivable of top 5 balances 1,810,933,879 432,753,771 20
As at December 31, 2019, top 5 accounts receivable in terms of ending balance presented by debtor summarized and
analyzed as follows:
Proportion in total balance of
Balance Provision for bad debts
accounts receivable %
Total accounts receivable of top 5 balances 1,305,425,250 367,432,657 20
(6) Accounts receivable derecognized due to the transfer of financial assets
□Applicable √Not applicable
(7) Amount of assets and liabilities formed by transferring accounts receivable and continuing involvement
□Applicable √Not applicable
Other description:
√Applicable □Not applicable
Changes in the provision for bad debts of accounts receivable are as follows:
Adjustments
Reduction of
December 31, for changes January 1, Provision in Reversal in December 31,
consolidation
2019 in accounting 2020 2020 2020 2020
scope
policies
2020 1,677,451,836 99,044,463 1,776,496,299 416,571,263 (279,106,645) (39,189,250) 1,874,771,667
2019 1,529,308,221 111,908,301 1,641,216,522 206,632,546 (170,397,232) - 1,677,451,836
Accounts receivable with provision for bad debts accrued by credit risk features portfolio are as follows:
2020 2019
Book balance Estimated Expected credit Book balance Estimated Expected credit
of estimated credit loss loss for the entire of estimated credit loss loss for the
default ratio (%) duration default ratio (%) entire duration
Within 1 year 6,154,544,858 5 293,763,096 3,725,543,945 2 91,032,730
1-2 years 965,250,727 20 190,547,180 602,231,607 13 80,579,861
2-3 years 213,806,234 29 61,516,189 449,964,072 20 89,520,636
3-4 years 177,715,234 63 111,926,196 246,662,162 29 70,797,046
4-5 years 177,122,400 42 75,011,044 175,572,099 68 119,983,513
Over 5 years 752,410,959 81 612,619,452 690,257,094 92 634,495,665
Total 8,440,850,412 1,345,383,157 5,890,230,979 1,086,409,451
98
2020
6 Receivables financing
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Bank acceptance bill 362,006,319 406,408,604
Total 362,006,319 406,408,604
Increase or decrease and changes in fair value of receivables financing in the current period:
□Applicable √Not applicable
If the provision for bad debts is calculated based on the general model of expected credit loss, please refer to other
receivables for disclosure:
□Applicable √Not applicable
Other description:
√Applicable □Not applicable
Notes receivable that had been endorsed or discounted and not matured on the balance sheet date are as follows:
2020 2019
Amount Amount not Amount Amount not
derecognized derecognized derecognized derecognized
Bank acceptance bill 571,531,799 - 738,496,754 -
7 Advances to suppliers
(1) Presentation of advances to suppliers by account age
√Applicable □Not applicable
Unit: Yuan Currency: CNY
December 31, 2020 December 31, 2019
Account age
Amount Proportion (%) Amount Proportion (%)
Within 1 year 486,471,381 64 603,532,662 64
1-2 years 192,424,837 25 267,030,956 29
2-3 years 48,275,668 6 54,362,644 6
Over 3 years 40,254,261 5 10,952,515 1
Total 767,426,147 100 935,878,777 100
Explanation of the reasons why the advances to suppliers with the aging over one year and a significant amount is not
settled in time:
As at December 31, 2020, the advances to suppliers of the Company with the aging over one year was RMB
280,954,766 (as at December 31, 2019: RMB 332,346,115), mainly the advances to suppliers for the procurement of
imported parts, which has not been yet settled because the purchased imported parts have not yet received.
(2) Top 5 advances to suppliers in terms of ending balance presented by prepaid object
√Applicable □Not applicable
As at December 31, 2020, top 5 advances to suppliers in terms of ending balance presented by debtor summarized and
analyzed as follows:
Amount Proportion in total advances to suppliers %
Total advances to suppliers of top 5 balances 140,561,799 18
As at December 31, 2019, top 5 advances to suppliers in terms of ending balance presented by debtor summarized and
analyzed as follows:
Amount Proportion in total advances to suppliers %
Total advances to suppliers of top 5 balances 354,954,218 38
99
Other description
□Applicable √Not applicable
8 Other receivables
Item presentation
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Interest receivable
Dividends receivable 1,072,390
Other receivables 913,410,163 1,209,969,911
Total 913,410,163 1,211,042,301
Other description:
□Applicable √Not applicable
Interest receivable
(1) Classification of interest receivable
□Applicable √Not applicable
(2) Significant overdue interest
□Applicable √Not applicable
(3) Provision for bad debts
□Applicable √Not applicable
Other description:
□Applicable √Not applicable
Dividends receivable
(4) Dividends receivable
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item (or invested entity) December 31, 2020 December 31, 2019
CCCC Nanjing Traffic Engineering Management Co., Ltd. 1,072,390
Total 1,072,390
(5) Significant dividends receivable aging over 1 year
□Applicable √Not applicable
(6) Provision for bad debts
□Applicable √Not applicable
Other description:
□Applicable √Not applicable
Other receivables
(7) Disclosure by aging
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Aging December 31, 2020
Within 1 year
Including: subitem within 1 year
Sub-total of items within 1 year 836,659,903
1-2 years 26,116,212
2-3 years 82,447,437
Over 3 years
3-4 years 193,114,103
4-5 years 1,556,265
Over 5 years 12,274,182
Total 1,152,168,102
100
2020
(8) Classification by nature of funds
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Nature of funds December 31, 2020 December 31, 2019
Unpaid taxes receivable 558,720,119 410,468,098
Secured repayment 164,124,678 164,124,678
Bid and performance bond 88,706,025 291,599,548
Advance payment receivable on behalf of
84,615,765 95,480,544
the third party
Money on call for product field service 33,945,802 43,035,827
Lease payment receivable 33,434,667 33,434,668
Customs-related security deposit 33,365,314 38,241,878
Staff borrowings receivable 20,309,050 23,557,060
Export rebates 166,044 214,352,290
Deposit receivable 10,000 2,946,042
Others 134,770,638 130,868,274
Total 1,152,168,102 1,448,108,907
(9) Provision for bad debts
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Stage I Stage II Stage III
Estimated credit Expected credit loss for Expected credit loss for
Provision for bad debts Total
losses over the the entire duration (no the entire duration (credit
next 12 months credit impairment) impairment has occurred)
Balance as at January 1, 2020 9,710,907 228,428,089 238,138,996
Balance as at January 1, 2020 in
current period
--Transferred to Stage II
--Transferred to Stage III
--Reversal to Stage II
--Reversal to Stage I
Provision in the current period 1,281,361 1,281,361
Reversal in the current period -662,418 -662,418
Write-off in the current period
Charge-off in the current period
Other changes
Balance as at December 31, 2020 10,329,850 228,428,089 238,757,939
Description of significant changes in book balance of other receivables with changes in loss provision in the current
period
□Applicable √Not applicable
The amount of provision for bad debts in the current period and the basis for assessing whether the credit risk of
financial instruments has increased significantly:
□Applicable √Not applicable
(10) Provision for bad debts
□Applicable √Not applicable
(11) Other receivables actually written off in the current period
□Applicable √Not applicable
101
(12) Top 5 other receivables in terms of ending balance presented by debtor
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Proportion in the Balance of provision
December 31,
Name Nature Aging total balance of other for bad debts at the
2020
receivables (%) end of the year
Other receivables 1 Secured repayment 164,124,678 3-4 years 14 164,124,678
Other receivables 2 Advance payment 54,318,681 4-5 years 5 52,427,770
Other receivables 3 Performance bond 34,800,000 2-3 years 3
Lease payment
Other receivables 4 33,434,668 Within 1 year 3
receivable
Customs-related
Other receivables 5 33,365,315 Within 1 year 3
security deposit
Total / 320,043,342 / 28 216,552,448
(13) Receivables involving government subsidies
□Applicable √Not applicable
(14) Other receivables derecognized due to transfer of financial assets
□Applicable √Not applicable
(15) Amount of assets and liabilities formed by transferring other receivables and continuing involvement
□Applicable √Not applicable
Other description:
□Applicable √Not applicable
9 Inventories
(1) Classification
√Applicable □Not applicable
Unit: Yuan Currency: CNY
December 31, 2020 December 31, 2019
Provision for inventory Provision for inventory
Item depreciation/ depreciation/
Book balance Provision for Book value Book balance Provision for Book value
impairment of contract impairment of contract
performance cost performance cost
Raw materials 3,118,133,185 54,960,402 3,063,172,783 3,370,311,931 76,456,971 3,293,854,960
Goods in process 20,113,138,980 939,360,778 19,173,778,202 18,795,106,546 1,021,070,136 17,774,036,410
Stock commodities 14,573,887 - 14,573,887 4,357,692 - 4,357,692
Revolving materials
Consumptive biological
assets
Contract performance
74,314,244 - 74,314,244
cost
Total 23,320,160,296 994,321,180 22,325,839,116 22,169,776,169 1,097,527,107 21,072,249,062
(2) Provision for inventory depreciation and provision for impairment of contract performance cost
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Increase in the current period Decrease in the current period
December 31, December 31,
Item Reversal or write-
2019 Provision Other Other 2020
off
Raw materials 76,456,971 20,717,774 42,214,343 54,960,402
Goods in process 1,021,070,136 358,911,278 440,620,636 939,360,778
102
2020
Increase in the current period Decrease in the current period
December 31, December 31,
Item Reversal or write-
2019 Provision Other Other 2020
off
Stock commodities
Revolving materials
Consumptive biological
assets
Contract performance cost
Total 1,097,527,107 379,629,052 482,834,979 994,321,180
(3) Description of the amount of capitalized borrowing costs included in ending balance of inventories
□Applicable √Not applicable
(4) Description of the current amortization amount of contract performance cost
□Applicable √Not applicable
Other description
√Applicable □Not applicable
Provision for inventory depreciation is as follows:
Reasons for provision for depreciation
Specific basis for determination of net
of inventories reversed or written-off in
realizable values
the current year
Product price fall results in raw materials
Raw materials and outsourced parts and and outsourced parts and components
Value recovery or external sales
components Difference between the net realizable value
and its book value
Difference between the net realizable value
Goods in process Value recovery or self-use
and the book value of goods in process
The write-off of provision for depreciation of goods in process mainly included the drilling platforms and floating cranes
originally planned for sale, which were changed for self-use according to the resolution of the Company’s management.
Total amount of possible penalties for failure to fulfill the obligations as contracted:
2020 2019
Valid letter of guarantee signed by the bank 12,587,156,263 11,500,477,841
Letter of guarantee not signed by the bank 6,717,974,498 7,293,181,242
Total 19,305,130,761 18,793,659,083
10 Contract assets (Applicable since Jan. 1, 2020)
(1) Particulars about contract assets
√Applicable □Not applicable
Unit: Yuan Currency: CNY
December 31, 2020 December 31, 2019
Item Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Warranty balance recognized at the time
877,580,462 43,597,676 833,982,786 435,489,867 16,195,461 419,294,406
of control transfer
Outstanding payments for construction
1,272,225,639 42,911,535 1,229,314,104 568,423,148 - 568,423,148
completed
Total 2,149,806,101 86,509,211 2,063,296,890 1,003,913,015 16,195,461 987,717,554
(2) Amount of and reason for significant changes in book value during the reporting period
□Applicable √Not applicable
103
(3) Provision for impairment of contract assets in current period
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Provision in the current Reversal in the Write-off/charge-off in the
Item Reason
period current period current period
Warranty balance recognized at the
35,823,814 4,231,421 - /
time of control transfer
Outstanding payments for
38,721,357 - /
construction completed
Total 74,545,171 4,231,421 - /
If the provision for bad debts is calculated based on the general model of expected credit loss, please refer to other
receivables for disclosure:
□Applicable √Not applicable
Other description:
√Applicable □Not applicable
Remark 1: When the Group sells equipment to customers and provides relevant installation services, it constitutes a single
performance obligation. When the Group recognizes revenue at the time of fulfilling its performance obligations, the Company’s
unconditional (i.e., only depending on the passage of time) right to collect consideration from customers shall be presented as
receivables. The non-invoiced contract warranty balance is the right to conditionally collect the consideration from the customer.
Therefore, the Company recognizes the non-invoiced contract receivables as contract assets, and the contract assets will form
unconditional collection right after the expiration of the warranty and will be transferred to the receivables.
Remark 2: The Group provides customers with infrastructure construction services and steel structure product
manufacturing, and recognizes revenue within a period of time to form contract assets. The contract assets will form
unconditional collection right at the time of project settlement and are transferred in receivables. The customers shall settle
accounts with the Group on the performance progress of engineering construction services and the delivery of steel structure
products under contract provisions, and pay the contract price according to the credit period specified in the contract after
settlement. The part of the income amount recognized by the Group according to the performance progress exceeding the
settled price is recognized as contract assets, and the part of the settled price exceeding the income amount recognized by
the Group according to the performance progress is recognized as contract liabilities.
The contract assets with provision for impairment loss by credit risk features portfolio are as follows:
2020
Book balance of estimated Estimated credit loss in the
Estimated credit loss rate (%)
default entire duration
Within 1 year 2,089,790,091 3 69,984,114
1-2 years 22,579,760 13 3,032,663
2-3 years 15,189,774 24 3,623,174
Over 3 years 22,246,476 44 9,869,260
Total 2,149,806,101 86,509,211
In this year, the performance progress of relevant construction contracts of the Group increased, and some of the
performance progress had not been settled, resulting in the increase in the book value of contract assets.
11 Assets held for sale
□Applicable √Not applicable
12 Non-current assets due within one year
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Debt investment due within one year
Other debt investments due within one year
Long-term receivables due within one year 1,884,370,444 1,313,203,581
Total 1,884,370,444 1,313,203,581
104
2020
Important debt investment and other debt investments due at the end of the period:
□Applicable √Not applicable
Other description
None
13 Other current assets
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Contract acquisition cost - -
Return cost receivable - -
Input tax to be deducted 688,621,455 704,526,288
Prepaid income tax 19,862,647 15,657,286
Total 708,484,102 720,183,574
Other description
None
14 Debt investment
(1) Particulars about debt investment
□Applicable √Not applicable
(2) Important debt investment at the end of the period
□Applicable √Not applicable
(3) Provision for impairment
□Applicable √Not applicable
The amount of provision for impairment in the current period and the basis for assessing whether the credit risk of
financial instruments has increased significantly
□Applicable √Not applicable
Other description
□Applicable √Not applicable
15 Other debt investments
(1) Particulars about other debt investments
□Applicable √Not applicable
(2) Important other debt investments at the end of the period
□Applicable √Not applicable
(3) Provision for impairment
□Applicable √Not applicable
The amount of provision for impairment in the current period and the basis for assessing whether the credit risk of
financial instruments has increased significantly
□Applicable √Not applicable
Other description:
□Applicable √Not applicable
16 Long-term receivables
(1) Long-term receivables
√Applicable □Not applicable
Unit: Yuan Currency: CNY
December 31, 2020 December 31, 2019
Provision Discount
Item Provision
Book balance for bad Book value Book balance Book value rate range
for bad debt
debt
Financing lease
Including: Unrealized financing
income
105
December 31, 2020 December 31, 2019
Provision Discount
Item Provision
Book balance for bad Book value Book balance Book value rate range
for bad debt
debt
Goods sold on installment
Services provided on installment
Receivables from “Building –
Transfer” project
- Principal 6,555,235,454 6,555,235,454 6,140,109,748 6,140,109,748
- Interest receivable 371,433,599 371,433,599 349,937,720 349,937,720
Accounts receivable from the projects
34,815,733 34,815,733 50,884,533 50,884,533
of collection of payment by installment
Less: Long-term receivables due
-1,884,370,444 -1,884,370,444 -1,313,203,581 -1,313,203,581
within one year
Total 5,077,114,342 5,077,114,342 5,227,728,420 5,227,728,420 /
As at December 31, 2020 and December 31, 2019, the account receivable from “Building – Transfer” project was the
principal invested in above “Building– Transfer” project by the Group, and the amount of interest receivable was the financing
return recognized based on the contract.
As at December 31, 2020, the long-term accounts receivable were RMB 5,614,309,162 (as at December 31, 2019: RMB
4,482,230,928), which had been pledged to the bank as the guarantee for the long-term borrowings of RMB 1,947,736,154 (as
at December 31, 2019: Long-term borrowings of RMB 1,420,127,942).
(2) Provision for bad debts
□Applicable √Not applicable
The amount of provision for bad debts in the current period and the basis for assessing whether the credit risk of
financial instruments has increased significantly
□Applicable √Not applicable
(3) Long-term receivables derecognized due to transfer of financial assets
□Applicable √Not applicable
(4) Amount of assets and liabilities formed by transferring long-term receivables and continuing involvement
□Applicable √Not applicable
Other description
√Applicable □Not applicable
Aging analysis of long-term receivable is as follows:
Item 2020 2019
Within 1 year 1,499,350,642 1,189,304,357
1-2 years 1,104,671,995 1,633,251,803
2-3 years 1,467,238,387 1,996,302,110
Over 3 years 2,890,223,762 1,722,073,731
Sub-total 6,961,484,786 6,540,932,001
Less: Long-term receivables due within one year 1,884,370,444 1,313,203,581
Total 5,077,114,342 5,227,728,420
17 Long-term equity investments
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Increase/decrease in the current period
Provision for
December 31, Profit or loss Adjustment Cash dividends December 31, impairment at
Invested entity Further Reduced on investments of other Changes in or profit Provision for
2019 Other 2020 the end of the
investment investment under the equity comprehensive other equity declared to be impairment year
method income distributed
I. Joint ventures
Jiangsu Longyuan Zhenhua
260,880,653 15,179,788 276,060,441
Marine Engineering Co., Ltd
106
2020
Increase/decrease in the current period
Provision for
December 31, Profit or loss Adjustment Cash dividends December 31, impairment at
Invested entity Further Reduced on investments of other Changes in or profit Provision for
2019 Other 2020 the end of the
investment investment under the equity comprehensive other equity declared to be impairment year
method income distributed
CCCC Tianhe Xi’an Equipment
36,170,279 -366,861 -35,803,418
Manufacturing Co., Ltd. (ii)
ZPMC Mediterranean Liman
Makinalari Ticaret Anonim 3,735,189 -3,165,847 569,342
Sirketi
ZPMC-OTL MARINE
- - - - - - - - - - -
CONTRACTOR LIMITED
Zhenhua Marine Energy (HK)
- - - - - - - - - - -
Co., Ltd. (i)
Cranetech Global Sdn. Bhd. 746,700 -114,520 632,180
CCCC Nanjing Traffic
Engineering Management Co., 11,279,238 9,899 -11,289,137
Ltd. (ii)
Sub-total 312,812,059 11,542,459 -47,092,555 277,261,963
II. Associates
CCCC Financial Leasing Co.,
1,785,702,878 118,432,798 -1,271,676 -19,713,242 1,883,150,758
Ltd (iii)
CCCC Estate Yixing Co., Ltd. 183,660,541 5,982,621 -2,700,000 186,943,162
CCCC South American
186,678,840 -2,462,090 -23,615,519 160,601,231
Regional Company SARL
China Communications
60,719,949 -1,690,256 -3,776,695 55,252,998
Construction USA Inc.
CCCC Marine Engineering &
Technology Research Center 16,730,804 185,678 16,916,482
Co., Ltd.
ZPMC Changzhou Coatings
17,635,277 2,241,634 -3,984,470 15,892,441
Co., Ltd.
ZPMC Southeast Asia Pte. Ltd 1,670,322 -14,674 1,655,648
CCCC Yancheng Construction
289,766,242 128,750,000 418,516,242
Development Co., Ltd.
Suzhou Chuanglian Electric
11,941,407 5,153,633 17,095,040
Drive Co., Ltd.
Shanghai Ocean Engineering
Equipment Manufacturing 6,355,426 -485,085 5,870,341
Innovation Center Co., Ltd.
CCCC Xiongan Urban
Construction Development 1,500,000 6,228 1,506,228
Co., Ltd. (iv)
Shanghai Xingyi Construction
1,570,350 1,570,350
Technology Co., Ltd.
Sub-total 2,560,861,686 131,820,350 127,350,487 -28,663,890 -26,397,712 2,764,970,921
Total 2,873,673,745 131,820,350 138,892,946 -28,663,890 -26,397,712 -47,092,555 3,042,232,884
Other description
Joint ventures:
(i) On May 5, 2014, the subsidiary of the Company and the partner invested to establish Zhenhua Marine Energy
(Hong Kong) Co., Ltd (Zhenhua Marine Energy). The registered capital is USD 5,969,998. The subsidiary of the Company
contributed USD 3,044,699 with the shareholding ratio of 51%. Zhenhua Marine Energy focused on the vessel transportation
business. Based on the regulations of the shareholder agreement, the important events of such company shall be agreed
by at least 75% shareholders via voting. Hence, the Group has no control right but jointly controls Zhenhua Marine Energy
together with the partner.
(ii) On June 4, 2020, CCCC, the controlling shareholder of the Company, increased the investment amounting to RMB
1,000,000,000 to CCCC Tianhe Mechanical Equipment Manufacturing Co., Ltd., the holding subsidiary of the Company.
On the same day, the persons acting in concert agreement between CCCC and the Company was terminated. Therefore,
on June 4, 2020, the proportion of voting rights enjoyed by the Company was changed to 16.52%, and the Company no
longer had control over CCCC Tianhe Mechanical Equipment Manufacturing Co., Ltd. Since June 4, 2020, the Group would
no longer include CCCC Tianhe Mechanical Equipment Manufacturing Co., Ltd. into the scope of combination. Therefore,
the two joint ventures of CCCC Tianhe Mechanical Equipment Manufacturing Co., Ltd., i.e. CCCC Tianhe Xi'an Equipment
Manufacturing Co., Ltd. and CCCC Nanjing Traffic Engineering Management Co., Ltd., are no longer joint ventures of the
Group at the end of this year.
107
Associates:
(i) On May 31, 2016, the Company and other shareholders increased the capital amounting to RMB 420,000,000 to
CCCC Financial Leasing Co., Ltd. in the same proportion. After the capital increase, the investment costs of the Company to
CCCC Financial Leasing Co., Ltd. Increased to RMB 1,500,000,000 with the unchanged shareholding ratio of 30%.
(iv) On June 23, 2020, the Company invested to establish CCCC Xiongan Urban Construction Development Co., Ltd.
The registered capital was RRMB 100,000,000. The Company contributed RMB 15,000,000 with the shareholding ratio of
15%. The company was mainly engaged in the engineering construction. According to relevant provisions of the Articles of
Association, the Company has the right to appoint one director to CCCC Xiongan Urban Construction Development Co., Ltd,
and can exert significant influence on the company.
18 Other equity instrument investment
(1) Particulars about other equity instrument investment
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Hunan Fengri Power & Electric Co., Ltd. 22,685,894 24,348,689
CCCC Highway Bridges National Engineering Research Centre Co., Ltd. 19,319,276 17,649,136
CCCC National Engineering Research Center of Dredging Technology
8,000,908 9,005,378
and Equipment Co., Ltd.
Ningbo Weilong Port Machinery Co., Ltd. (Former name: ZPMC Ningbo
6,565,227 7,241,610
Transmission Machinery Co., Ltd)
Shenyang Weichen Crane Equipment Co., Ltd. (Former name: Shanghai
4,197,036 2,865,664
Zhenhua Port Machinery (Group) Shenyang Elevator Co., Ltd.)
ZPMC Longchang Lifting Equipment Co., Ltd (Former name: Shanghai
Zhenhua Port Machinery (Group) Longchang Lifting Equipment Co., 737,410 870,791
Ltd.)
Total 61,505,751 61,981,268
(2) Equity instrument investment not held for trading
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount Reasons for
Reasons for financial
Dividend of other transferring
assets designated
income comprehensive other
Accumulated Accumulated to be measured at
Item recognized income comprehensive
gains losses fair value through
in the current transferred income into
other comprehensive
period to retained retained
income
earnings earnings
Hunan Fengri Power & Strategic investment,
2,687,734
Electric Co., Ltd. long-term holding
CCCC Highway Bridges
National Engineering Strategic investment,
6,319,276
Research Centre Co., long-term holding
Ltd.
CCCC National
Engineering Research
Strategic investment,
Center of Dredging 1,600,908
long-term holding
Technology and
Equipment Co., Ltd.
Ningbo Weilong Port
Machinery Co., Ltd.
Strategic investment,
(Former name: ZPMC 5,269,227
long-term holding
Ningbo Transmission
Machinery Co., Ltd)
108
2020
Amount Reasons for
Reasons for financial
Dividend of other transferring
assets designated
income comprehensive other
Accumulated Accumulated to be measured at
Item recognized income comprehensive
gains losses fair value through
in the current transferred income into
other comprehensive
period to retained retained
income
earnings earnings
Shenyang Weichen
Crane Equipment Co.,
Ltd. (Former name:
Strategic investment,
Shanghai Zhenhua 2,697,036
long-term holding
Port Machinery (Group)
Shenyang Elevator Co.,
Ltd.)
ZPMC Longchang
Lifting Equipment Co.,
Ltd (Former name:
Strategic investment,
Shanghai Zhenhua 62,590
long-term holding
Port Machinery (Group)
Longchang Lifting
Equipment Co., Ltd.)
21st Century Science
Strategic investment,
and Technology 30,000,000
long-term holding
Investment Co., Ltd.
Other description:
□Applicable √Not applicable
19 Other non-current financial assets
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Financial assets measured at fair value through the current profit or loss 330,094,057 -
Total 330,094,057 -
Other description:
√Applicable □Not applicable
On December 31, 2020, the Group’s financial assets measured at fair value through the current profit or loss are the fair
value of the Company’s 16.52% equity in CCCC Tianhe Mechanical Equipment Manufacturing Co., Ltd.
20 Investment properties
Measurement model of investment properties
(1) Investment properties with cost measurement mode
Unit: Yuan Currency: CNY
Buildings and Construction in
Item Land use right Total
constructions progress
I. Original book value
1. Balance as at December 31, 2019 397,820,689 209,845,794 607,666,483
2. Increase in current period 68,064,517 68,064,517
(1) Outsourcing
(2) Transfer-in of inventories, fixed assets and
construction in progress
(3) Increase in business combination
(4) Debt restructuring for debt repayment 68,064,517 68,064,517
3. Decrease in current period
109
Buildings and Construction in
Item Land use right Total
constructions progress
(1) Disposal
(2) Other transfer-out
4. Balance as at December 31, 2020 465,885,206 209,845,794 675,731,000
II. Accumulative depreciation and amortization
1. Balance as at December 31, 2019 123,057,915 66,183,035 189,240,950
2. Increase in current period 13,511,735 5,370,796 18,882,531
(1) Provision or amortization 13,511,735 5,370,796 18,882,531
3. Decrease in current period
(1) Disposal
(2) Other transfer-out
4. Balance as at December 31, 2020 136,569,650 71,553,831 208,123,481
III. Provision for impairment
1. Balance as at December 31, 2019
2. Increase in current period
(1) Provision
3. Decrease in current period
(1) Disposal
(2) Other transfer-out
4. Balance as at December 31, 2020
IV. Book value
1. Book value at the end of the period 329,315,556 138,291,963 467,607,519
2. Book value at the beginning of the period 274,762,774 143,662,759 418,425,533
(2) Investment property without certificate of title
□Applicable √Not applicable
Other description
√Applicable □Not applicable
Remark 1: the newly added property in this year is the property received from customers in debt restructuring for
debt repayment. The book value is recognized by the fair value of the abandoned creditor's rights and other costs directly
attributable to the assets such as taxes. As of December 31, 2020, the ownership of the property has been changed.
21 Fixed assets
Item presentation
□Applicable √Not applicable
Other description:
□Applicable √Not applicable
Fixed assets
(1) Particulars about fixed assets
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Office and Transportation
Buildings and Machinery
Item electronic facilities Ship Total
constructions equipment
equipment (Excluding ship)
I. Original book value
1. Balance as at December
11,569,317,816 8,430,886,826 270,788,319 258,377,194 13,994,101,710 34,523,471,865
31, 2019
2. Increase in current period 30,571,004 734,689,502 30,120,874 16,609,972 1,229,829,911 2,041,821,263
(1) Purchase 11,773,442 228,582,283 27,602,740 16,609,972 3,835,965 288,404,402
110
2020
Office and Transportation
Buildings and Machinery
Item electronic facilities Ship Total
constructions equipment
equipment (Excluding ship)
(2) Transfer-in of construction
18,797,562 506,107,219 2,518,134 1,225,993,946 1,753,416,861
in progress
(3) Increase in business
combination
3. Decrease in current period 449,722,197 2,280,519,036 16,859,344 17,921,204 212,005,670 2,977,027,451
(1) Disposal or scrap 458,447 72,668,322 2,853,592 8,113,117 970,879 85,064,357
(2) Reduction of consolidation
449,263,750 2,207,850,714 14,005,752 9,808,087 2,680,928,303
scope
(3) Exchange rate changes 211,034,791 211,034,791
4. Balance as at December
11,150,166,623 6,885,057,292 284,049,849 257,065,962 15,011,925,951 33,588,265,677
31, 2020
II. Accumulated depreciation
1. Balance as at December
4,038,333,249 5,539,517,778 207,931,042 184,292,139 3,098,430,358 13,068,504,566
31, 2019
2. Increase in current period 362,200,339 290,031,654 17,748,088 10,952,920 537,087,321 1,218,020,322
(1) Provision 362,200,339 290,031,654 17,748,088 10,952,920 537,087,321 1,218,020,322
3. Decrease in current period 87,675,328 370,458,172 11,352,967 17,146,267 32,227,874 518,860,608
(1) Disposal or scrap 227,588 59,443,047 2,575,139 8,113,117 733,974 71,092,865
(2) Reduction of consolidation
87,447,740 311,015,125 8,777,828 9,033,150 416,273,843
scope
(3) Exchange rate changes 31,493,900 31,493,900
4. Balance as at December
4,312,858,260 5,459,091,260 214,326,163 178,098,792 3,603,289,805 13,767,664,280
31, 2020
III. Provision for impairment
1. Balance as at December
31, 2019
2. Increase in current period
(1) Provision
3. Decrease in current period
(1) Disposal or scrap
4. Balance as at December
31, 2020
IV. Book value
1. Book value at the end of
6,837,308,363 1,425,966,032 69,723,686 78,967,170 11,408,636,146 19,820,601,397
the period
2. Book value at the
7,530,984,567 2,891,369,048 62,857,277 74,085,055 10,895,671,352 21,454,967,299
beginning of the period
(2) Temporary idle fixed assets
□Applicable √Not applicable
(3) Fixed assets acquired under finance leases
□Applicable √Not applicable
(4) Fixed assets leased out through operating lease
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item Book value at the end of the period
Vessel 4,314,276,451
111
(5) Fixed assets without certificate of title
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item Book value Reasons for pending certificate of title
Buildings and constructions 880,944,048 The handling of relevant formalities is still in process.
Other description:
√Applicable □Not applicable
As at December 31, 2020, the following fixed assets were taken as loan mortgage:
Borrowings
Original price Book value
Nature Amount
Vessel 3,329,529,889 2,821,018,550 Long-term payables 1,807,890,037
As at December 31, 2019, the following fixed assets were taken as loan mortgage:
Borrowings
Original price Book value
Nature Amount
Machinery equipment 1,387,867,681 255,113,376 Long-term payables 89,262,318
Vessel 6,634,000,717 5,439,133,909 Long-term payables 2,161,280,894
Total 8,021,868,398 5,694,247,285 2,250,543,212
As at December 31, 2020 and December 31, 2019, the book values of fixed assets for operating lease were as follows:
2020 2019
Machinery equipment - 783,490,756
Vessel 4,314,276,451 1,622,945,798
Total 4,314,276,451 2,406,436,554
As at December 31, 2020, the fixed assets with pending certificate of title were as follows:
Book value Reasons for pending certificate of title
The handling of relevant formalities is still
Buildings and constructions 880,944,048
in process.
Liquidation of fixed assets
□Applicable √Not applicable
22 Construction in progress
Item presentation
□Applicable √Not applicable
Other description:
□Applicable √Not applicable
Construction in progress
(1) Particulars about construction in progress
√Applicable □Not applicable
Unit: Yuan Currency: CNY
December 31, 2020 December 31, 2019
Item Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Infrastructure construction of Nantong
144,172,138 144,172,138 98,623,383 98,623,383
Base
112
2020
December 31, 2020 December 31, 2019
Item Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Infrastructure construction of
115,534,831 115,534,831 80,973,129 80,973,129
Changxing Base
Large machinery and engineering
equipment of the base under 4,127,886,615 4,127,886,615 4,052,729,743 4,052,729,743
construction
Office building and ancillary facilities 29,401 29,401
Shield machine parts project 28,416,002 28,416,002
Infrastructure construction of Nanhui
3,451,124 3,451,124 3,061,744 3,061,744
Base
Large mechanical reconstruction and
129,103,111 129,103,111 116,656,486 116,656,486
upgrading project
Total 4,520,147,819 4,520,147,819 4,380,489,888 4,380,489,888
(2) Changes of major construction in progress
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount
Proportion of Including:
transferred Other Cumulative Capitalization rate
cumulative capitalization
December 31, Increase in the into fixed decreases in December Construction amount of for the interest in
Project Budget project of the interest Fund source
2019 current period assets in the current 31, 2020 progress interest the current period
investment in in the current
the current period capitalized (%)
budget (%) period
period
Infrastructure
Self-owned
construction of 7,817,201,771 98,623,383 62,448,765 16,900,010 144,172,138 85 85
funds
Nantong Base
Infrastructure Self-owned
construction of 8,678,930,500 80,973,129 38,654,498 4,014,003 78,793 115,534,831 83 83 23,531,836 funds and bank
Changxing Base borrowings
Large machinery
and engineering Self-owned
equipment of 8,362,817,390 4,052,729,743 970,168,945 463,797,781 431,214,292 4,127,886,615 98 98 213,369,676 53,531,666 3.48 funds and bank
the base under borrowings
construction
Office building and Self-owned
34,798,370 29,401 86,842 116,243 99 99
ancillary facilities funds
Self-owned
Shield machine
140,796,531 28,416,002 9,431,135 7,701,302 30,145,835 93 93 5,762,616 funds and bank
parts project
borrowings
Infrastructure
Self-owned
construction of 531,736,425 3,061,744 10,207,567 9,818,187 3,451,124 89 89
funds
Nanhui Base
Large mechanical
Self-owned
reconstruction and 1,200,868,710 116,656,486 105,882,437 48,999,335 44,436,477 129,103,111 76 76
funds
upgrading project
Total 26,767,149,697 4,380,489,888 1,196,880,189 551,346,861 505,875,397 4,520,147,819 / / 242,664,128 53,531,666 / /
(3) Provision for impairment of construction in progress in the current period
□Applicable √Not applicable
Other description
□Applicable √Not applicable
Engineering materials
(4) Particulars about engineering materials
□Applicable √Not applicable
113
23 Productive biological assets
(1) Productive biological assets with cost measurement model
□Applicable √Not applicable
(2) Productive biological assets measured by fair value
□Applicable √Not applicable
Other description
□Applicable √Not applicable
24 Oil and gas assets
□Applicable √Not applicable
25 Right-of-use assets
□Applicable √Not applicable
26 Intangible assets
(1) Particulars about intangible assets
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Land use Nonproprietary Software Proprietary
Item Patent right Total
right technology use fee technology
I. Original book value
1. Balance as at December
4,297,078,828 75,619,611 65,296,171 4,437,994,610
31, 2019
2. Increase in current period 18,805,594 18,805,594
(1) Purchase 18,487,863 18,487,863
(2) Internal R & D
(3) Increase in business
combination
(4) Transfer-in of construction
317,731 317,731
in progress
3. Decrease in current period 96,727,232 96,727,232
(1) Disposal
(2) Reduction of consolidation
96,727,232 96,727,232
scope
4. Balance as at December
4,200,351,596 94,425,205 65,296,171 4,360,072,972
31, 2020
II. Accumulated amortization
1. Balance as at December
818,093,843 51,245,791 62,113,610 931,453,244
31, 2019
2. Increase in current period 86,880,884 6,887,365 1,609,730 95,377,979
(1) Provision 86,880,884 6,887,365 1,609,730 95,377,979
3. Decrease in current period 14,208,965 14,208,965
(1) Disposal
(2) Reduction of consolidation
14,208,965 14,208,965
scope
4. Balance as at December
890,765,762 58,133,156 63,723,340 1,012,622,258
31, 2020
III. Provision for impairment
114
2020
Land use Nonproprietary Software Proprietary
Item Patent right Total
right technology use fee technology
1. Balance as at December
31, 2019
2. Increase in current period
(1) Provision
3. Decrease in current period
(1) Disposal
4. Balance as at December
31, 2020
IV. Book value
1. Book value at the end of
3,309,585,834 36,292,049 1,572,831 3,347,450,714
the period
2. Book value at the
3,478,984,985 24,373,820 3,182,561 3,506,541,366
beginning of the period
At the end of the period, the proportion of intangible assets formed through internal R&D in the balance of intangible
assets is 0.
In 2020, total technology research and development expenses of the Group amounted to RMB 737,468,137 (2019:
RMB 887,096,178). These technology research and development expenses are not capitalized.
(2) Land use right without certificate of title
□Applicable √Not applicable
Other description:
□Applicable √Not applicable
27 Development expenditures
□Applicable √Not applicable
28 Goodwill
(1) Original book value of goodwill
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Increase in current
Name of the invested Decrease in current period
period December 31,
entity or the matters December 31, 2019
Formed by Business 2020
forming goodwill Disposal Other
combination
ZPMC Qidong Marine
149,212,956 149,212,956
Engineering Co., Ltd.
Verspannen B.V. 5,412,807 5,412,807
Greenland Heavy lift
113,809,171 7,362,471 106,446,700
(HongKong) Limited
Total 268,434,934 7,362,471 261,072,463
Remark 1: The decrease in the current year was caused by the translation differences of foreign currency statement.
(2) Provision for impairment of goodwill
□Applicable √Not applicable
(3) Information about the asset group or portfolio of the goodwill
□Applicable √Not applicable
115
(4) Explain the goodwill impairment test process, key parameters (such as the growth rate during forecast period when
estimating the present value of future cash flow, growth rate during stable period, profit rate, discount rate, forecast period, if
applicable) and the recognition method of goodwill impairment loss
□Applicable √Not applicable
(5) Impact of goodwill impairment test
□Applicable √Not applicable
Other description
√Applicable □Not applicable
As at December 31, 2020, the Group had no provision for the impairment of goodwill. When the impairment test is
conducted, the book value of goodwill is amortized to the asset group portfolio expected to benefit from the synergistic effect
of business combination.
The goodwill acquired through business combination has been distributed to the following asset groups for impairment test:
Heavy equipment asset group
Semi-submerged ship transport assets group of Greenland Heavylift (Hongkong) Limited (GHHL)
Heavy equipment asset group
The recoverable amount of heavy equipment asset group is measured based on the five-year budget approved by the
management and shall be measured with cash flow forecast method. Cash flow over 5-year period shall be calculated based
on the estimated growth rate.
The main assumptions of the future cash flow discount method:
Growth rate during forecast period 8.12%-33.44%
Perpetual growth rate 3%
Gross profit rate 15.27%
Pre-tax discount rate 12.9%
GHHL semi-submerged ship transport assets group
The recoverable amount of GHHL semi-submerged ship transport assets group combination is determined based on
the expected future cash flow of the asset group, and the expected future cash flow is determined according to the cash flow
forecast based on the transport service contract revenue expected to be obtained within the service life of vessel.
The main assumptions of the future cash flow discount method:
Number of customized short-distance and long-distance transport
3 /year/vessel
service contracts expected to be obtained
Vessel utilization rate of general charter party 65%
Charter rate of general charter party USD 68,000/ day
Pre-tax discount rate 11.9%
The distributions of the book value of goodwill to asset groups are as follows:
GHHL semi-submerged ship
Heavy equipment asset group Total
transport assets group
2020 2019 2020 2019 2020 2019
Book amount of goodwill 154,625,763 154,625,763 106,446,700 113,809,171 261,072,463 268,434,934
The perpetual growth rate adopted by management does not exceed the industry's long-term average growth rate.
Based on the historical experience and the forecasts of market development, the management determines the budget
gross profit rate and adopts the pretax interest rate which can reflect the specific risk of relevant asset group portfolio as the
discount rate. The above assumptions are used to analyze the recoverable amount of the asset group portfolio.
116
2020
29 Long-term deferred expenses
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Increase in the Amortization in Other
Item December 31, 2019 December 31, 2020
current period the current period decreases
Improvement expenditure of
fixed assets under operating 1,444,636 5,744,148 2,892,382 3,793,591 502,811
lease
Total 1,444,636 5,744,148 2,892,382 3,793,591 502,811
Other description:
2019
December Increase in the Amortization in Other December 31,
31, 2019 current year the current year decreases 2020
Improvement expenditure of fixed
5,112,664 - (3,668,028) - 1,444,636
assets under operating lease
30 Deferred income tax assets/liabilities
(1) Deferred income tax assets before offsetting
√Applicable □Not applicable
Unit: Yuan Currency: CNY
December 31, 2020 December 31, 2019
Item Deductible temporary Deferred income Deductible temporary Deferred income
differences tax assets differences tax assets
Provision for impairment of assets 2,828,618,698 424,967,341 4,365,778,693 654,866,804
Unrealized profits of internal
131,655,187 19,748,278 60,082,114 12,012,332
transactions
Deductible loss 1,966,910,762 295,036,614 384,592,112 57,688,817
Estimated liabilities 253,696,912 38,054,537 470,724,247 70,608,637
Wages and salaries unpaid 29,765,369 4,464,805 28,462,182 4,269,327
Interest unpaid 16,209,697 2,431,454 37,098,343 5,564,751
Deferred income 63,738,135 9,560,720
Unrealized contract gross profit 431,033,663 64,655,049 202,110,980 30,316,647
Changes in fair value of held-for-
7,312,741 1,096,911
trading financial liabilities
Total 5,657,890,288 849,358,078 5,619,899,547 845,984,946
(2) Deferred income tax liabilities before offsetting
√Applicable □Not applicable
Unit: Yuan Currency: CNY
December 31, 2020 December 31, 2019
Item Taxable temporary Deferred income Taxable temporary Deferred income
differences tax liabilities differences tax liabilities
Asset evaluation increment from business
111,575,168 16,736,275 126,855,063 19,028,259
combination not under common control
Changes in fair value of other debt investments - - - -
Changes in fair value of other equity investment 18,511,592 2,776,739 18,987,108 2,848,066
Changes in fair value of held-for-trading
686,586,358 103,059,339 373,507,095 57,055,388
financial assets
Depreciation of fixed assets 482,995,412 80,491,724 535,071,991 88,286,880
Total 1,299,668,530 203,064,077 1,054,421,257 167,218,593
117
(3) Deferred income tax assets or liabilities presented by net amount after offset
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Balance of deferred Offset amount of Balance of deferred
Offset amount of
income tax assets deferred income tax income tax assets and
deferred income tax
Item and liabilities after assets and liabilities liabilities after offset
assets and liabilities at
offset at the end of at the beginning of at the beginning of
the end of the period
the period the period the period
Deferred income tax assets 96,397,406 752,960,672 77,361,866 768,623,080
Deferred income tax liabilities 96,397,406 106,666,671 77,361,866 89,856,727
(4) Details of unrecognized deferred income tax assets
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Deductible temporary differences 184,855,083 222,990,045
Deductible losses 1,676,785,029 1,671,758,752
Total 1,861,640,112 1,894,748,797
(5) The deductible losses on the unrecognized deferred income tax assets will become due in the following years
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Year December 31, 2020 December 31, 2019 Remark
2020 368,426,916
2021 69,696,906 99,087,307
2022 248,507,784 252,840,194
2023 562,790,591 576,831,247
2024 374,573,088 374,573,088
2025 421,216,660
Total 1,676,785,029 1,671,758,752 /
Other description:
□Applicable √Not applicable
31 Other non-current assets
√Applicable □Not applicable
Unit: Yuan Currency: CNY
December 31, 2020 December 31, 2019
Item Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Contract acquisition cost - - - - - -
Return cost receivable - - - - - -
Contract warranty balance
551,442,577 18,260,301 533,182,276 938,482,329 39,033,628 899,448,701
receivable
Advance payment for vessels 134,070,905 - 134,070,905 132,563,749 - 132,563,749
Outstanding payments for
169,751,108 - 169,751,108 - - -
construction completed
118
2020
December 31, 2020 December 31, 2019
Item Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Advance payment for office
- - - 28,773,538 28,773,538
buildings
Total 855,264,590 18,260,301 837,004,289 1,099,819,616 39,033,628 1,060,785,988
Other description:
The changes in the provision for impairment of the contract warranty balance receivable are as follows:
Adjustments Balance at the
Provision in Balance at
Balance at the for changes beginning of Reversal in the
the current the end of the
end of last year in accounting the current current year
year current year
policies year
2020 - 39,033,628 39,033,628 16,743,103 (37,516,430) 18,260,301
32 Short-term borrowings
(1) Classification of short-term borrowings
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Pledged borrowings
Mortgage borrowings
Guaranteed borrowings 2,321,035,033 1,363,293,671
Fiduciary borrowings 15,474,041,532 20,638,025,709
Total 17,795,076,565 22,001,319,380
Description of the classification of short-term borrowings:
As at December 31, 2020, the annual interest rate on the aforesaid borrowings ranges from 0.50% to 5.66% (as at
December 31, 2019: 2.7% to 5.66%).
(i) As at December 31, 2020, the bank guarantee loan amounting to USD 171,651,399, equivalent to RMB 1,120,008,214
(as at December 31, 2019: USD 195,420,669, equivalent to RMB 1,363,293,671) was the bank loans borrowed by the
subsidiary of the Company, which was guaranteed by the letter of guarantee issued by the bank for the Company within the
scope of credit.
As at December 31, 2020, the bank guarantee loan amounting to RMB 1,201,026,819 (as at December 31, 2019: 0) was
the bank loans borrowed by the Company, with joint and several liability repayment guarantee provided by its subsidiaries.
(2) Overdue outstanding short-term borrowings
□Applicable √Not applicable
The important overdue outstanding short-term borrowings are as follows:
□Applicable √Not applicable
Other description
□Applicable √Not applicable
33 Held-for-trading financial liabilities
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Increase in current Decrease in current
Item December 31, 2019 December 31, 2020
period period
Held-for-trading financial
liabilities
119
Increase in current Decrease in current
Item December 31, 2019 December 31, 2020
period period
Financial liabilities measured
at fair value through the
current profit or loss
Derivative financial liabilities 7,312,741 458,882
Total 7,312,741 458,882
Other description:
□Applicable √Not applicable
34 Derivative financial liabilities
□Applicable √Not applicable
35 Notes payable
(1) Presentation of notes payable
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Type December 31, 2020 December 31, 2019
Commercial acceptance bill
Bank acceptance bill 3,600,725,892 3,420,945,451
Total 3,600,725,892 3,420,945,451
The total amount of notes payable due and unpaid at the end of the period was RMB 0.
36 Accounts payable
(1) Presentation of accounts payable
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Payables for material purchase and product
7,293,306,336 7,095,705,902
manufacturing
Equipment and vessel purchase payables 236,939,531 361,370,347
Quality guarantee deposit payable 203,484,597 352,114,025
Infrastructure payables 36,176,452 55,685,497
Port charge payable 3,996,231 4,502,594
Total 7,773,903,147 7,869,378,365
(2) Important accounts payable aging over 1 year
□Applicable √Not applicable
Other description
√Applicable □Not applicable
Aging analysis of accounts payable is as follows:
2020 2019
Proportion in total Proportion in total
Amount Amount
amount% amount%
Within 1 year 6,313,738,368 81 6,173,075,498 78
Over 1 year 1,460,164,779 19 1,696,302,867 22
Total 7,773,903,147 100 7,869,378,365 100
120
2020
As at December 31, 2020, the accounts payable with the aging over 1 year were mainly the payables for imported parts,
which had not been taken for final settlement.
37 Advances from customers
(1) Presentation of advances from customers
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Advances from customers for goods (i) - -
Advances for lease payment 4,893,675 166,750,428
Total 4,893,675 166,750,428
(i) The advances from customers for goods in this year shall be accounted as contract liabilities after the implementation
of new revenue standard.
(2) Important advances from customers with the aging over 1 year
□Applicable √Not applicable
Other description
√Applicable □Not applicable
Aging analysis of advances from customers is as follows:
2020 2019
Proportion in Proportion in total
Amount Amount
total amount% amount%
Within 1 year 4,893,675 100 728,030,570 88
Over 1 year - - 94,957,416 12
Total 4,893,675 100 822,987,986 100
38 Contract liabilities (Applicable from January 1, 2020)
(1) Particulars about contract liabilities
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Advances from customers for goods 10,747,054,468 9,407,248,317
Amount settled for uncompleted work 448,254,615 333,571,365
Total 11,195,309,083 9,740,819,682
(2) Amount of and reason for significant changes in book value during the reporting period
□Applicable √Not applicable
Other description:
√Applicable □Not applicable
In the current year, the products corresponding to the advances from customers for goods by the Group have not been
delivered, resulting in an increase in the book value of contract liabilities.
39 Payroll payable
(1) Presentation of payroll payable
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Increase in current Decrease in current
Item December 31, 2019 December 31, 2020
period period
I. Short-term compensation 329,928,711 1,814,781,525 1,955,910,267 188,799,969
121
Increase in current Decrease in current
Item December 31, 2019 December 31, 2020
period period
II. Post-employment benefits -
49,570 219,730,336 219,779,906 -
defined contribution plans
III. Dismissal benefits
IV. Other benefits due within
one year
Total 329,978,281 2,034,511,861 2,175,690,173 188,799,969
(2) Presentation of short-term compensation
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Increase in current Decrease in current
Item December 31, 2019 December 31, 2020
period period
I. Salaries, bonuses, allowances
293,726,618 1,456,926,078 1,597,165,890 153,486,806
and subsidies
II. Employee welfare 15,537 58,302,543 58,318,080
III. Social insurance premium 30,589 111,962,438 111,984,923 8,104
Including: medical insurance
25,794 97,829,362 97,847,862 7,294
premium
Work-related injury insurance
2,118 4,535,010 4,537,128
premium
Maternity insurance premium 2,677 9,598,066 9,599,933 810
IV. Housing provident funds 20,539 147,698,483 147,710,962 8,060
V. Union expenditures and
36,135,428 27,337,248 28,175,677 35,296,999
employee education expenses
VI. Short-term paid absence
VII. Short-term profit sharing plan
VIII. Other short-term
12,554,735 12,554,735
compensation
Total 329,928,711 1,814,781,525 1,955,910,267 188,799,969
(3) Presentation of defined contribution plans
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Increase in Decrease in
Item December 31, 2019 December 31, 2020
current period current period
1. Basic endowment insurance premium 48,140 126,565,169 126,613,309
2. Unemployment insurance premium 1,430 855,312 856,742
3. Enterprise annuity payment
4. Supplementary endowment insurance
92,309,855 92,309,855
premium
Total 49,570 219,730,336 219,779,906
Other description:
□Applicable √Not applicable
122
2020
40 Tax payable
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
VAT 31,497,623 19,182,496
Consumption tax
Sales tax
Enterprise income tax 85,855,884 84,488,181
Individual income tax 11,361,113 14,648,581
Urban maintenance and construction tax 1,397,325 445,032
Education surtax 1,295,006 381,574
Others 29,375,980 25,360,878
Total 160,782,931 144,506,742
Other description:
Not applicable
41 Other payables
Item presentation
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Interest payable
Dividends payable 352,598 31,701,965
Other payables 480,713,102 679,688,031
Total 481,065,700 711,389,996
Other description:
□Applicable √Not applicable
Interest payable
(1) Presentation by category
□Applicable √Not applicable
Dividends payable
(2) Presentation by category
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Common stock dividends
Preferred stock/perpetual debt dividends classified as
equity instruments
Preferred stock/perpetual debt dividends-XXX
Preferred stock/perpetual debt dividends-XXX
Dividends payable - CCCC Tianjin Dredging Co., Ltd. 25,079,494
Dividends payable - Chuwa Bussan Co. Ltd. 6,269,873
Dividends payable - Hong Kong Zhenhua Engineering
346,005 346,005
Co., Ltd.
123
Item December 31, 2020 December 31, 2019
Dividends payable - Macau Zhenhua Harbour
6,593 6,593
Construction Co., Ltd.
Total 352,598 31,701,965
Other explanations, including important dividends payable that have not been paid for more than one year, the reasons
for non-payment shall be disclosed:
As at December 31, 2020, the reason for the dividend payable with the aging over 1 year amounting to RMB 352,598 (as
at December 31, 2019: RMB 31,701,965) was that the shareholders of the Company had not requested for actual payment
by the Group.
Other payables
(1) Other payables presented by nature
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Engineering deposit and quality guarantee deposit 230,926,693 227,040,148
Investment section payable to CCCC (i) 100,971,833
Amounts due to related parties 84,675,989 77,381,454
Special payables 16,022,785 16,971,821
Others 149,087,635 257,322,775
Total 480,713,102 679,688,031
(2) Important other payables with the aging over 1 year
□Applicable √Not applicable
Other description:
√Applicable □Not applicable
(i) The Group completed the cancellation of a subsidiary in 2011. RMB 25,971,833 in the balance was the investment
liquidation fund payable by the Group and attributable to CCCC who was another shareholder of the subsidiary; meanwhile,
the Group completed the merger and acquisition of the subsidiary of CCCC under the common control in 2015, and RMB
75,000,000 in the balance was the purchase fund payable by the Group to CCCC. As of December 31, 2020, all relevant
payments have been completed.
Aging analysis of other payables is as follows:
2020 2019
Amount Proportion % Amount Proportion %
Within 1 year 349,708,190 73 501,239,668 74
Over 1 year 131,004,912 27 178,448,363 26
Total 480,713,102 100 679,688,031 100
As at December 31, 2020, the other payables with the aging over 1 year were mainly the payable deposit and quality
guarantee deposit collected from outsourcing engineering team and payables to related party.
42 Liabilities held for sale
□Applicable √Not applicable
43 Non-current liabilities due within one year
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Long-term borrowings due within one year 914,366,451 6,533,318,585
Bonds payable due within one year
124
2020
Item December 31, 2020 December 31, 2019
Long-term payables due within one year 460,098,868 754,165,928
Lease liabilities due within one year
Total 1,374,465,319 7,287,484,513
Other description:
None
44 Other current liabilities
Other current liabilities
□Applicable √Not applicable
Increase or decrease of short-term bonds payable:
□Applicable √Not applicable
Other description:
□Applicable √Not applicable
45 Long-term borrowings
(1) Classification of long-term borrowings
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Pledged borrowings 1,947,736,154 1,420,127,942
Mortgage borrowings
Guaranteed borrowings 797,215,505 3,689,523,034
Fiduciary borrowings 15,019,714,534 9,837,007,595
Less: Long-term borrowings due within one
year
Fiduciary borrowings -239,762,214 -2,966,074,277
Guaranteed borrowings -470,970,505 -3,219,523,034
Pledged borrowings -203,633,732 -347,721,274
Total 16,850,299,742 8,413,339,986
Description of the classification of long-term borrowings:
None
Other description, including interest rate range:
√Applicable □Not applicable
As at December 31, 2020, the annual interest rate on the aforesaid borrowings ranges from 1.20% to 5.46% (as at
December 31, 2019: 2.95% to 5.46%).
(i) As at December 31, 2020, the bank guarantee loan amounting to USD 50,000,000, equivalent to RMB 326,245,000 (as
at December 31, 2019: USD 50,518,682, equivalent to RMB 352,428,432), was the bank loan borrowed by the Company's
subsidiary Shanghai Zhenhua Port Machinery (Hong Kong) Co., Ltd. and the guarantee was provided by the Company. The
interest shall be paid quarterly and the principal shall be repaid on July 10, 2023.
As at December 31, 2020, the bank guarantee loan amounting to RMB 470,970,505 (as at December 31, 2019: RMB
1,973,532,215), was the bank loan borrowed by the Company. The Company’s subsidiary ZPMC Port Machinery General
Equipment Co., Ltd., provided the joint and several liability repayment guarantee. The interest shall be paid quarterly and the
principal will be due on November 10, 2021.
(ii) As at December 31, 2020, the total amount of multiple pledged loans amounting to RMB 1,947,736,154 (as at
December 31, 2019: RMB 1,420,127,942) took the long-term accounts receivable of the “building-transfer” project of the
Group as pledge. The interest shall be paid quarterly, and the principal shall be repaid between July 29, 2021 and August 27,
2033 (as at December 31, 2019: the principal shall be repaid between December 15, 2020 and December 23, 2029).
125
46 Bonds payable
(1) Bonds payable
□Applicable √Not applicable
(2) Increase or decrease of bonds payable: (excluding preferred shares, perpetual bonds and other financial instruments
classified as financial liabilities)
□Applicable √Not applicable
(3) Conditions and time for conversion of convertible bonds
□Applicable √Not applicable
(4) Description of other financial instruments classified as financial liabilities
Basic information of outstanding preferred shares, perpetual bonds and other financial instruments at the end of the
period
□Applicable √Not applicable
Changes in outstanding preferred shares, perpetual bonds and other financial instruments at the end of the period
□Applicable √Not applicable
Description of the basis for classifying other financial instruments as financial liabilities:
□Applicable √Not applicable
Other description:
□Applicable √Not applicable
47 Lease liabilities
□Applicable √Not applicable
48 Long-term payables
Item presentation
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Long-term payables
Special payables
Leaseback financing fund (i) 1,807,890,037 2,250,543,212
"Building - transfer” project fund (ii) 139,682,456 139,682,457
Project quality guarantee deposit 145,284,307 105,885,895
Less: Leaseback financing fund due within one
-460,098,868 -754,165,928
year
Total 1,632,757,932 1,741,945,636
Other description:
√Applicable □Not applicable
(i) As at December 31, 2020, the long-term payables of RMB 1,807,890,037 (December 31, 2019: RMB 2,250,543,212)
were obtained from the vessel with the book value of RMB 2,821,018,550 (as at December 31, 2019: vessels of RMB
5,439,133,909, machinery equipment of RMB 255,113,376) in leaseback way from the financial leasing company, with
the maturity date from December 5, 2021 to September 24, 2031 (December 31, 2019: from April 11, 2020 to September
24, 2031). The Group will pay the leaseback financing fund on schedule each year to the financial leasing company in
accordance with the contract terms. The Group takes the above series of transactions as mortgage loans for accounting
treatment.
(ii) The Group and the construction party of “building-transfer” project agreed that part of the project payments would be
paid to the construction party after the final acceptance of the “building-transfer” project within a certain term.
Long-term payables
(1) Presentation of long-term payables by nature
□Applicable √Not applicable
Special payables
(2) Presentation of special payables by nature
□Applicable √Not applicable
49 Long-term payroll payable
□Applicable √Not applicable
126
2020
50 Estimated liabilities
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2019 December 31, 2020 Causes
External guarantee
Pending litigation
Product quality guarantee deposit
Restructuring obligations
Loss contracts to be executed
Refund payable
Estimated after-sale service cost 481,342,622 261,072,318
Others 2,658,150
Total 484,000,772 261,072,318 /
Other description, including relevant important assumptions and estimates of important estimated liabilities:
None
51 Deferred income
Deferred income
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Increase in Decrease in
Item December 31, 2019 December 31, 2020 Causes
current period current period
Government subsidies 360,656,713 66,115,003 73,932,916 352,838,800
Land compensation 98,065,866 62,148,665 35,917,201
Total 458,722,579 66,115,003 136,081,581 388,756,001 /
As at December 31, 2020, liability items involved in government subsidies:
√Applicable □Not applicable
Unit: Yuan Currency:CNY
Amount
Amount
New included
included
subsidy in non-
December in other Other December 31, Assets related /
Liability item amount operating
31, 2019 income changes 2020 income related
in current income
in current
period in current
period
period
Hoisting and pipe laying
47,450,000 47,450,000 Income related
ship R&D project
Automated dock R&D
37,455,000 -9,405,000 28,050,000 Income related
project
Offshore deep water
environmental protection
intelligent fishing ground 20,000,000 20,000,000 Income related
construction project in
Fujian
Intelligent transportation
system of Automatic 16,800,000 16,800,000 Income related
navigation vehicle
127
Amount
Amount
New included
included
subsidy in non-
December in other Other December 31, Assets related /
Liability item amount operating
31, 2019 income changes 2020 income related
in current income
in current
period in current
period
period
Deep sea drilling ship
and auxiliary equipment 14,860,000 1,340,000 16,200,000 Income related
research project
Research and
demonstration project of
crane boom structure and its 16,000,000 -800,000 15,200,000 Income related
test with low cost and large
bearing capacity at sea
Intelligent manufacturing
workshop for crane box of 14,171,796 14,171,796 Income related
automated terminal
Key technology research
project of bottom-
12,400,000 12,400,000 Income related
supported offshore wind
power installation platform
10,000t semi-submerged
12,506,667 -560,000 11,946,667 Income related
ship R&D project
Comprehensive
standardization of
intelligent manufacturing 11,700,000 11,700,000 Income related
of marine engineering
equipment
High skill training facilities
and equipment funding 10,964,700 10,964,700 Income related
project
Transportation
emplacement system 10,000,000 10,000,000 Income related
R&D project
Floating crane R&D
12,659,000 -2,740,400 9,918,600 Income related
project
Architecture design and
testing tools development
of the next generation
11,210,000 -1,600,000 9,610,000 Income related
of intelligent operation
platform for automated
container terminals
Drilling platform R&D
9,390,000 9,390,000 Income related
project
Research and
development of large-
8,533,000 -432,000 8,101,000 Income related
scale underwater robot
work-system
Manufacturing process
optimization R&D project in 8,000,000 8,000,000 Income related
marine engineering field
R&D and application
demonstration project
for the intelligent coating
8,000,000 8,000,000 Income related
system of the main
structure of large port
machinery
128
2020
Amount
Amount
New included
included
subsidy in non-
December in other Other December 31, Assets related /
Liability item amount operating
31, 2019 income changes 2020 income related
in current income
in current
period in current
period
period
Self-elevating platform
6,190,000 6,190,000 Income related
central control system
Retractable boarding
trestle system R&D 4,448,300 1,551,700 6,000,000 Income related
project
Unmanned driving
technology piercing and
5,850,000 5,850,000 Income related
intelligent group control
system project
Development and
industrialization of large
5,572,000 5,572,000 Income related
deep water crane piping
ship
Marine engineering
positioning system R&D 4,472,885 4,380,000 -3,423,391 5,429,494 Income related
project
Collaborative innovation
in the industrial chain of
core components for high- 2,100,000 1,050,000 3,150,000 Income related
end marine engineering
equipment
Key technology research
and development, system
integration and application 2,985,000 2,985,000 Income related
of intelligent horizontal
transport vehicle
Finishing intelligent
production line of special
2,560,000 2,560,000 Income related
gear shaft for port
machinery
Research and application
of key technologies for
intelligent maintenance
3,280,000 -800,000 2,480,000 Income related
system for automatic
container handling
equipment
Intelligent manufacturing
2,280,000 2,280,000 Income related
line for crane box
Design and manufacturing
technology of stinger
2,400,000 -288,000 2,112,000 Income related
for deepwater subsea
pipeline laying system
Soft set hybrid cloud
system construction project
of the Economic and 1,990,000 1,990,000 Income related
Information Technology
Commission in 2019
Research on the
technology and application
3,960,000 -2,110,000 1,850,000 Income related
of marine environmental
protection coatings
129
Amount
Amount
New included
included
subsidy in non-
December in other Other December 31, Assets related /
Liability item amount operating
31, 2019 income changes 2020 income related
in current income
in current
period in current
period
period
Port outdoor trackless
navigation heavy load 4,070,000 -2,320,000 1,750,000 Income related
project
Automatic transfer
equipment and supporting 1,540,000 1,540,000 Income related
technology
Research on the heave
motion compensation 1,088,000 1,088,000 Income related
technology of mining pipe
Intelligent transportation
equipment and supporting
990,000 990,000 Income related
technology for multimodal
transportation
Research and introduction
of key technologies for
three-dimensional VOCs 1,600,000 -640,000 960,000 Income related
observation, traceability
and near-zero emission
Industrial Internet based
on Beidou time and space 760,500 760,500 Income related
benchmark service
AGV Eight-wheel 180
degree rotary electric 860,000 -160,000 700,000 Income related
differential AGV
Development of HIL
test platform for key
500,000 500,000 Income related
control system of marine
engineering ships
Precise shape control,
performance control,
manufacturing and
assembly technology 200,000 200,000 Income related
for high-speed precision
heavy duty herringbone
gear
Special equipment
research project for the
construction of immersed 180,000 180,000 Income related
tube tunnel of Shenzhen-
Zhongshan Access
Development of intelligent
operation system for 144,123 144,123 Income related
dredging vessel
Multi-method integration
technology development
and demonstration 126,000 126,000 Income related
application project for
innovation chain
Two ISO international
standards development 60,000 60,000 Income related
projects approved in 2018
130
2020
Amount
Amount
New included
included
subsidy in non-
December in other Other December 31, Assets related /
Liability item amount operating
31, 2019 income changes 2020 income related
in current income
in current
period in current
period
period
Intelligent equipment for
1,245,000 -1,245,000 Income related
container yard
Others 68,133,065 6,764,980 -38,784,960 -8,624,165 27,488,920 Income related
Total 360,656,713 66,115,003 -56,158,751 -17,774,165 352,838,800
Other description:
√Applicable □Not applicable
Remark 1: the government subsidies of RMB 556,923 and land compensation of RMB 60,448,960 in decreases in this
year was due to the change of consolidation scope.
The above government subsidies are related to income.
Land compensation refers to the land compensation acquired by a subsidiary of the Company, which shall be amortized
over the 50 years’ land use term.
52 Other non-current liabilities
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Contract liabilities
Output tax to be carried forward 430,372,502 376,626,821
Total 430,372,502 376,626,821
Other description:
On balance sheet date, the revenue of some construction contracts and interest income of “building-transfer” projects of
the Company had not reached the time point of the VAT liability.
53 Share capital
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Increase/decrease (+/-)
December 31, Conversion
New shares Share Sub- December 31,
2019 of reserves Others
issued donation total 2020
into share
Total shares 5,268,353,501 5,268,353,501
Other description:
None
54 Other equity instruments
(1) Basic information of outstanding preferred shares, perpetual bonds and other financial instruments at the end of the
period
√Applicable □Not applicable
As of December 31, 2020, the details of the Group’s outstanding perpetual bonds are as follows:
Accounting Issue Maturity or
Date of issue Interest rate Number Amount
classification price renewal
Perpetual medium-
term notes
131
Accounting Issue Maturity or
Date of issue Interest rate Number Amount
classification price renewal
Second issue
of medium-term
notes of Shanghai December 24, Equity
5.06% 100 5,000,000 500,000,000 Undue
Zhenhua Heavy 2020 instrument
Industries Co., Ltd.
in the year 2020
The Group issued the perpetual notes on December 24, 2020, with a term of 2+N (2) years, which will survive for a
long time before the Group redeems in accordance with the terms of issue, and will mature when the issuer redeems in
accordance with the terms of issue. The initial coupon of perpetual notes is 5.06%. In accordance with the terms of issue
of medium-term notes, the Company has the right to distribute cash interest annually at annual interest rate and has no
contractual obligation to repay the principal or pay any interest free of charge. Except for compulsory interest payment,
on each interest payment date of medium-term notes, the Group may, at its own option, postpone the payment of current
interest and all deferred interest and its fruits in accordance with this clause to the next interest payment date, and is not
limited by the number of deferred interest payments. On the reset date of the coupon rate of medium-term notes, the
Company has the right to redeem the medium-term notes at face value plus interest payable (including all deferred interest
payments). The Group deems that the notes do not meet the definition of financial liabilities and therefore classifies it as
other equity instruments.
(2) Changes in outstanding preferred shares, perpetual bonds and other financial instruments at the end of the period
√Applicable □Not applicable
Increase in current Decrease in current
Outstanding Beginning Ending
period period
financial
Book Book
instruments Amount Amount Book value Amount Amount Book value
value value
Second issue
of medium-term
notes of Shanghai
5,000,000 500,000,000 5,000,000 500,000,000
Zhenhua Heavy
Industries Co., Ltd. in
the year 2020
Total 5,000,000 500,000,000 5,000,000 500,000,000
Description of the increase and decrease of other equity instruments in the current period, reasons for changes, and
basis for relevant accounting treatment:
□Applicable √Not applicable
Other description:
□Applicable √Not applicable
55 Capital reserves
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Increase in Decrease in
Item December 31, 2019 December 31, 2020
current period current period
Capital premium (Share capital
4,537,774,553 4,537,774,553
premium)
Other capital reserves
Business combination under common
-16,203,111 -16,203,111
control
Purchase of minority interest -711,345 -711,345
Absorption of minority shareholders’
185,934,674 185,934,674
investments by subsidiaries
132
2020
Increase in Decrease in
Item December 31, 2019 December 31, 2020
current period current period
Transfer-in of capital reserves under
128,059,561 128,059,561
the original system
Total 4,834,854,332 4,834,854,332
Other description, including the increase and decrease in the current period and the reasons for changes:
None
56 Treasury stock
□Applicable √Not applicable
57 Other comprehensive income
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in the current period
Less: amount Less: amount
previously previously
included in included in
Attributable
December 31, the other the other Attributable December
Item to the
2019 comprehensive comprehensive Less: to the parent 31, 2020
Pre-tax amount minority
income and income and income tax company
equity after
currently currently after tax
tax
transferred to transferred
the profit or to retained
loss earnings
I. Other
comprehensive
income that can't -13,860,957 -475,517 -71,328 -404,189 -14,265,146
be reclassified into
profit and loss
Including: Remeasure
the variation of net
indebtedness or
net asset of defined
benefit plan
Other comprehensive
income that can't
be reclassified into
profit and loss in the
invested enterprise
under equity method
Fair value change of
other equity instrument -13,860,957 -475,517 -71,328 -404,189 -14,265,146
investments
Fair value change of
enterprise credit risks
II. Other
comprehensive
income that will be 37,391,408 -108,841,187 -86,053,660 -22,787,527 -48,662,252
reclassified into
profit and loss
Including: Other
comprehensive
income that will be
reclassified into -9,051,692 -28,663,890 -28,663,890 -37,715,582
profit and loss in the
invested enterprise
under equity method
Fair value change of
other debt investments
Amount of financial
assets reclassified into
other comprehensive
income
Provision for credit
impairment of other
debt investments
Cash flow hedging
reserve
133
Amount incurred in the current period
Less: amount Less: amount
previously previously
included in included in
Attributable
December 31, the other the other Attributable December
Item to the
2019 comprehensive comprehensive Less: to the parent 31, 2020
Pre-tax amount minority
income and income and income tax company
equity after
currently currently after tax
tax
transferred to transferred
the profit or to retained
loss earnings
Translation reserve 46,443,100 -80,177,297 -57,389,770 -22,787,527 -10,946,670
Total other
comprehensive 23,530,451 -109,316,704 -71,328 -86,457,849 -22,787,527 -62,927,398
income
Other description, including the adjustment of the initial recognition amount of the effective part of profit or loss of cash
flow hedging converted into the hedged item:
None
58 Special reserves
√Applicable □Not applicable
2020
Unit: Yuan Currency: CNY
Increase in current Decrease in current
Item December 31, 2019 December 31, 2020
period period
Work safety expenses 3,615,638 82,412,828 84,092,313 1,936,153
Total 3,615,638 82,412,828 84,092,313 1,936,153
2019
December 31, 2019 Increase Decrease December 31, 2020
Work safety expenses 3,019,173 71,228,319 (70,631,854) 3,615,638
Other description, including the increase and decrease in current period and the reasons for changes:
According to the relevant requirements of the Administrative Measures for the Withdrawal and Use of Work Safety
Expenses, the enterprises engaged in large - scale machinery manufacture and engineering construction shall withdraw the
work safety expenses according to the standards. The increase and decrease in current year was the work safety expenses
withdrawn and used by the Group for the reporting year in accordance with relevant requirements.
59 Surplus reserves
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Balance at the Changes in Increase
December 31, Decrease in December 31,
Item end of the last accounting in current
2019 current period 2020
year policies period
Statutory surplus reserves 1,468,820,041 -143,572,545 1,325,247,496 33,792,383 1,359,039,879
Discretionary surplus
292,378,668 - 292,378,668 292,378,668
reserves
Reserve fund
Enterprise development
fund
Others
Total 1,761,198,709 -143,572,545 1,617,626,164 33,792,383 1,651,418,547
Description of surplus reserves, including the increase and decrease in current period and the reasons for changes:
134
2020
In accordance with the Company Law of the People Republic of China, the Company’s Article of Association and the
resolutions of the Board of Directors, the Company withdrew 10% of its net profit as statutory surplus reserves. When the
accumulated amount of statutory surplus reserves reaches 50% or more of the share capital, the Company can stop the
withdrawal.
The statutory surplus reserves can be used to compensate loss upon approval, or to increase share capital. The
statutory surplus reserves withdrawn by the Company amounted to RMB 33,792,383 in 2020 (2019: RMB 64,436,155).
60 Undistributed profits
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item Current period Previous period
Undistributed profits at the end of previous period before adjustment 3,651,851,383 3,344,953,206
Total undistributed profits at the beginning of the adjustment period
-1,399,694,619 119,821,864
(increase +, decrease -)
Undistributed profits at the beginning of the period after adjustment 2,252,156,764 3,464,775,070
Plus: Net profit attributable to owners of the parent company 422,240,299 514,930,143
Less: withdrawal of statutory surplus reserves 33,792,383 64,436,155
Withdrawal of discretionary surplus reserve
Withdrawal of general risk preparation
Common stock dividends payable 263,417,675 263,417,675
Common stock dividends converted to share capital
Undistributed profits at the end of the period 2,377,187,005 3,651,851,383
Details of undistributed profit at the beginning of adjustment period:
1. Due to the retroactive adjustment of Accounting Standards for Business Enterprises and related new regulations, the
impact on undistributed profits at the beginning of the period was RMB 0.
2. The impact of changes in accounting policies on undistributed profits at the beginning of the period was RMB -1,399,694,619.
3. The impact of correction of major accounting errors on undistributed profits at the beginning of the period was RMB 0.
4. The impact of change of consolidation scope caused by the common control on undistributed profits at the beginning
of the period was RMB 0.
5. The total impacts of other adjustment on undistributed profits at the beginning of the period were RMB 0.
61 Operating revenue and operating costs
(1) Operating revenue and operating costs
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in the current period Amount incurred in the previous period
Item
Revenue Cost Revenue Cost
Primary business 22,396,639,375 19,305,124,813 24,212,854,752 20,419,043,031
Other business 258,502,277 108,140,441 382,733,131 171,488,291
Total 22,655,141,652 19,413,265,254 24,595,587,883 20,590,531,322
Primary business revenue and cost are presented as below:
2020 2019
Primary business Primary business Primary business Primary business
revenue cost revenue cost
Port machinery 14,457,042,916 11,813,606,078 16,458,563,164 13,240,912,286
Heavy equipment 1,062,669,195 994,642,219 1,491,597,749 1,218,182,031
"Building-transfer" project and
2,365,760,874 2,220,603,949 2,564,145,018 2,428,961,159
engineering construction
135
2020 2019
Primary business Primary business Primary business Primary business
revenue cost revenue cost
Steel structures and related revenue 3,277,507,651 3,170,269,443 2,709,430,977 2,571,473,994
Vessel shipping and others 1,233,658,739 1,106,003,124 989,117,844 959,513,561
Total 22,396,639,375 19,305,124,813 24,212,854,752 20,419,043,031
Other business revenue and cost are presented as below:
2020 2019
Other business Other business
Other business cost Other business cost
revenue revenue
Sales of materials 71,730,251 68,201,530 84,343,163 76,180,525
Equipment leasing and others 186,772,026 39,938,911 298,389,968 95,307,766
Total 258,502,277 108,140,441 382,733,131 171,488,291
(2) Details of operating revenue
Unit: Yuan Currency: CNY
Amount incurred in the Amount incurred in the
Item
current period previous period
Operating revenue 22,655,141,652 /
Less: business income unrelated to primary business 258,502,277 /
Less: income without commercial substance /
Operating revenue after deducting the business income unrelated
22,396,639,375 /
to primary business and the income without commercial substance
(3) Income from contracts
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Classification of Contract XXX-Division Total
Type of goods
Port machinery 14,457,042,916
Steel structures and related revenue 3,277,507,651
"Building-transfer" project and engineering construction 2,365,760,874
Heavy equipment 1,062,669,195
Vessel shipping and others 966,389,544
Sales of materials and others 183,277,589
By region of operation
Chinese Mainland 12,861,392,242
Europe 2,604,103,174
Asia (excluding Chinese Mainland) 3,289,553,492
North America 1,345,494,819
Chinese Mainland (export sales) 1,061,063,332
Africa 468,958,316
South America 444,522,956
Oceania 237,559,438
Market or customer type
Contract type
136
2020
Classification of Contract XXX-Division Total
Revenue recognized at a certain point of time
Port machinery 14,457,042,916
Heavy equipment 1,062,669,195
Steel structure and related income 1,704,177,499
Sales of materials and others 547,116,273
Revenue recognized in a certain period of time
“Building-transfer” project and engineering construction 2,365,760,874
Steel structure and related income 1,573,330,152
Shipping 602,550,860
By time of goods transfer
By contract term
By sales channel
Total 22,312,647,769
Description of income from contracts:
□Applicable √Not applicable
(4) Performance obligations
√Applicable □Not applicable
The information about the performance obligations of the Group is as follows:
Sales of port machinery, heavy equipment and steel structure products
The Group performs its obligations when delivering port machinery to customers and obtaining pre-delivery certificate
or other relevant delivery certificates. The Group performs its obligations when delivering heavy equipment to customers and
obtaining the handover protocol or other relevant delivery certificate. For the steel structure product manufacturing contract
that meets the performance obligations within a certain period of time, the Group performs its performance obligations within
the time of transferring the steel structure product; for the steel structure product manufacturing contract that does not meet
the performance obligation within a certain period of time, the Group performs its performance obligations when the steel
structure product is delivered and signed by the owner. The contract price is usually paid according to the payment schedule
agreed in the contract. After the delivery of the goods, the customer usually retains a certain proportion of the quality
guarantee deposit, which is usually paid after the expiration of the quality guarantee period. The Group provides guaranteed
warranty for the above products.
Building services
The Group performs its performance obligations within the time of providing services, and the contract price is usually
paid within 30 days after the settlement of the project. The customer usually retains a certain proportion of the quality
guarantee deposit, which is usually paid after the expiration of the quality guarantee period.
Shipping services
The Group performs its performance obligations within the time of providing transportation services. The contract price
is usually paid within the period from 3 days before unloading to 30 days after unloading.
(5) Apportionment to remaining performance obligations
□Applicable √Not applicable
Other description:
The revenue recognized in the current year and included in the book value of contract liabilities at the beginning of the
year is as follows:
2020
Advances from customers for goods 5,570,531,698
Amount settled for uncompleted work 289,457,020
Total 5,859,988,718
The revenue recognized in the current year for the performance obligations that have been performed (or partially
performed) in the previous period is as follows:
137
2020
“Building-transfer” project and engineering construction 2,208,312,044
Steel structure and related income 69,275,266
Total 2,277,587,310
62 Taxes and surcharges
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in the Amount incurred in the
Item
current period previous period
Consumption tax
Sales tax
Urban maintenance and construction tax 10,671,136 5,291,413
Educational surtax 8,659,201 4,625,393
Resource tax
Housing property tax 45,516,534 52,880,028
Land use tax 20,586,848 24,137,152
Vehicle and vessel use tax
Stamp duty 17,975,543 16,163,330
Others 2,869,009 4,931,365
Total 106,278,271 108,028,681
Other description:
None
63 Selling and distribution expenses
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in the Amount incurred in the
Item
current period previous period
Employee compensation 72,513,095 74,574,647
Travel expenses 9,813,222 20,877,895
Advertising and publicity costs 5,750,174 6,112,880
Sales and service fees 3,639,283 6,028,717
Bidding and tendering expenses 2,474,607 4,381,065
Exhibition fees 2,363,964 2,028,918
Office expenses 2,352,391 1,854,211
Others 6,856,903 6,658,703
Total 105,763,639 122,517,036
Other description:
None
64 General and administrative expenses
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in the Amount incurred in the
Item
current period previous period
Employee compensation 447,298,395 574,875,380
138
2020
Amount incurred in the Amount incurred in the
Item
current period previous period
Amortization of intangible assets 95,379,020 98,274,728
Depreciation of fixed assets 76,563,986 78,096,567
Travel expenses 59,283,191 79,287,298
Office expenses 53,476,219 66,065,944
Expenses from employment of intermediaries 48,556,452 26,042,989
Management and security fees 23,042,397 23,138,964
Management and cleaning fees 15,830,539 14,822,114
Consulting fees 13,457,793 16,504,530
Informatization expenses 12,013,428 12,571,622
Entertainment expenses 11,040,364 14,982,731
Insurance expenses 8,970,976 13,347,013
Maintenance cost 6,972,417 6,151,691
Others 65,815,662 70,969,716
Total 937,700,839 1,095,131,287
Other description:
Not applicable
65 Research and development expenses
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in the Amount incurred in the
Item
current period previous period
Employee compensation 391,087,521 422,157,374
Processing expenses 105,358,575 173,591,786
Depreciation expenses 92,450,574 133,479,779
Materials expenses 82,490,115 97,624,849
Product design expenses 1,046,746 5,968,051
Others 65,034,606 54,274,339
Total 737,468,137 887,096,178
Other description:
None
66 Financial expenses
√Applicable □Not applicable
Unit: Yuan Currency:CNY
Amount incurred in the Amount incurred in the
Item
current period previous period
Interest expenses 1,396,776,727 1,746,843,552
Less: Capitalized amount of interest -53,531,666 -44,551,183
Less: interest income -369,113,644 -331,452,183
Exchange losses 85,689,295 15,933,055
Others 57,921,152 109,813,173
Total 1,117,741,864 1,496,586,414
139
Other description:
The capitalized amounts of borrowing costs have been included in the construction in progress.
67 Other income
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in the Amount incurred in the
Item
current period previous period
Fiscal appropriation (i) 72,103,587 68,173,798
Technological subsidy (ii) 19,425,763 17,850,797
Land compensation (iii) 1,698,701 2,434,993
Total 93,228,051 88,459,588
Other description:
(i) and (ii) are related to income, while (iii) is related to assets.
68 Investment income
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in the Amount incurred in the
Item
current period previous period
Income from long-term equity investment calculated under the equity
138,892,946 110,724,316
method
Investment income from disposal of long-term equity investment 27,195,895
Investment income from held-for-trading financial assets during the
45,769,202 63,766,921
holding period
Dividend income from other equity instrument investment during holding 6,171,983
Interest income from debt investment during holding
Interest income from other debt investment during holding
Investment income from disposal of held-for-trading financial assets 195,487,757 109,315
Investment income from disposal of other equity instrument investment
Investment income from disposal of debt investment
Investment income from disposal of other debt investment
Total 413,517,783 174,600,552
Other description:
None
69 Net exposure hedging gain
□Applicable √Not applicable
70 Income from fair value change
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in the Amount incurred in the
Sources of income from fair value change
current period previous period
Held-for-trading financial assets
Including: income from fair value change of derivative financial
instruments
140
2020
Amount incurred in the Amount incurred in the
Sources of income from fair value change
current period previous period
Stock investment of listed companies 93,856,832 117,579,147
Derivative financial instruments - Forward exchange contract 7,312,741 -44,481,806
Derivative financial instruments - Foreign exchange option contract -11,264,555 22,235,244
Held-for-trading financial assets
Including: Derivative financial instruments - Forward exchange
-7,312,741
contract
Investment property measured at fair value
Other non-current financial assets 4,267,438
Total 94,172,456 88,019,844
Other description:
None
71 Credit impairment loss
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in the Amount incurred in the
Item
current period previous period
Loss on bad debts of notes receivable
Loss on bad debts of accounts receivable 137,464,618 36,235,314
Loss on bad debts of other receivables 618,943 2,526,279
Loss on impairment of debt investment
Loss on impairment of other debt investment
Loss on bad debts of long-term receivables
Loss on impairment of contract assets
Total 138,083,561 38,761,593
Other description:
None
72 Assets impairment losses
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in the Amount incurred in the
Item
current period previous period
I. Bad debt loss
II.Loss on price falling of inventory and impairment loss of contract
164,106,800 -71,619,476
performance costs
III. Impairment loss of long-term equity investment
IV. Impairment loss of investment property
V. Impairment loss of fixed assets
VI. Impairment loss of engineering materials
VII. Impairment loss of construction in progress
VIII. Impairment loss of productive biological assets
IX. Impairment loss of oil and gas assets
X. Impairment loss of intangible assets
XI. Goodwill impairment loss
141
Amount incurred in the Amount incurred in the
Item
current period previous period
XII. Others
XIII. Impairment loss of contract assets 49,540,423
XIV. Estimated contract losses 124,113,760
Total 213,647,223 52,494,284
Other description:
None
73 Income from disposal of assets
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in the Amount incurred in the
Item
current period previous period
Income from disposal of fixed assets 6,755,688 49,091,913
Total 6,755,688 49,091,913
Other description:
None
74 Non-operating income
Non-operating income
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount Amount included in
Amount incurred in the
Item incurred in the non-recurring profit or
current period
previous period loss in current period
Total gains from disposal of non-current assets
Including: gains from disposal of fixed assets
Gains from disposal of intangible assets
Gains from debt restructuring
Gains from exchange of non-monetary assets
Accepting donations
Government subsidies 4,620,975 4,812,392 4,620,975
Revenue from insurance indemnity 60,000
Others 12,716,524 11,590,318 12,716,524
Total 17,337,499 16,462,710 17,337,499
Government subsidies included in current profit or loss
□Applicable √Not applicable
Other description:
□Applicable √Not applicable
142
2020
75 Non-operating expenditure
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount included in
Amount incurred in the Amount incurred in the
Item non-recurring profit or
current period previous period
loss in current period
Total loss on disposal of non-current assets
Including: Loss on disposal of fixed assets
Loss on disposal of intangible assets
Loss on debt restructuring
Loss on exchange of non-monetary assets
Overdue fine payment 3,139,745 1,213,012 3,139,745
Amercement outlay 2,080,000 5,535,000 2,080,000
External donations 768,149 128,984 768,149
Lawsuit compensation 21,781,220
Others 2,010,016 1,545,282 2,010,016
Total 7,997,910 30,203,498 7,997,910
Other description:
Supplementary information on the classification by nature of the operating costs, selling and distribution expenses,
general and administrative expenses, and research and development expenses of the Group is as follows:
2020 2019
Used raw materials and low-cost consumables 21,607,174,313 15,704,636,157
Changes in goods in process and inventories (7,257,183,881) -
Employee compensation 2,034,511,861 2,216,065,862
Depreciation and amortization expenses 1,335,173,214 1,330,738,630
Outsourcing expenses 1,424,619,572 1,378,775,266
Transportation expenses 576,522,583 589,854,221
On-site installation expenses 206,431,154 257,412,249
Rental fees 264,369,240 218,357,687
After-sale cost 260,202,215 240,972,483
Energy cost 216,052,124 216,602,224
Travel expenses 69,096,413 100,165,193
Office expenses 55,828,610 67,920,155
Expenses from employment of intermediaries 48,556,452 26,042,989
Informatization expenses 12,013,428 12,571,622
Entertainment expenses 11,040,364 14,982,731
Bidding and tendering expenses 2,474,607 2,028,918
Other expenses 327,315,600 318,149,436
Total 21,194,197,869 22,695,275,823
143
76 Income tax expenses
(1) Table of income tax expenses
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in the Amount incurred in the
Item
current period previous period
Current income tax expenses 84,990,560 72,527,877
Deferred income tax expenses 1,080,440 21,222,707
Total 86,071,000 93,750,584
(2) Accounting profit and income tax expenses adjustment process
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item Amount incurred in the current period
Total profits 502,206,431
The income tax expenses calculated based on statutory/applicable tax rates 75,330,965
Influences caused by different tax rates adopted by subsidiaries 27,065,779
Influences caused by adjustment on income tax of previous periods
Influences on non-taxable income
Influences caused by non-deductible cost, expenses and losses 3,672,781
Influences caused by non-confirmation of deductible losses of deferred income tax assets
Influences caused by non-confirmation of deductible temporary differences or deductible
54,361,762
losses in current period
Profit or loss attributable to joint ventures and associates -20,833,942
Tax-free income -12,270,940
Adjustment to final settlement in previous years 15,130,141
Use of deductible losses in previous years -21,891,855
Additional deduction of technological development expenses -34,493,691
Income tax expenses 86,071,000
Other description:
□Applicable √Not applicable
77 Other comprehensive income
□Applicable √Not applicable
78 Cash flow statement items
(1) Other cash received related to operating activities
√Applicable □Not applicable
Unit: Yuan Currency:CNY
Amount incurred in the Amount incurred in the
Item
current period previous period
Customs deposit recovered 198,238,436 215,598,140
Cash received from government subsidies and rewards 117,022,985 99,690,746
Employee loan recovered 3,248,010 4,949,202
Cash received from the revenue from fines 11,083,645 7,820,315
Others 8,697,650 1,708,855
Total 338,290,726 329,767,258
144
2020
Description of other cash received related to operating activities：
None
(2) Other cash paid related to operating activities
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in the Amount incurred in the
Item
current period previous period
Customs deposit paid 193,361,873 190,498,482
Expenditures on selling and distribution expenses, general and
231,503,637 480,355,112
administrative expenses, and research and development expenses
Financial expenses and handling charges 45,869,065 72,827,220
Subsidy for research and development paid to cooperative units 17,217,242 6,075,000
Others 105,577,762 157,753,932
Total 593,529,579 907,509,746
Description of other cash paid related to operating activities :
None
(3) Other cash received related to investing activities
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in the Amount incurred in the
Item
current period previous period
Interest income 337,058,520 267,388,460
Total 337,058,520 267,388,460
Description of other cash received related to investing activities:
None
(4) Other cash paid related to investing activities
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in the Amount incurred in the
Item
current period previous period
Net cash outflows from disposal of subsidiaries 243,269,060
Others 22,982,499
Total 266,251,559
Description of other cash paid related to operating activities :
None
(5) Other cash received related to financing activities
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in the Amount incurred in the
Item
current period previous period
Restricted bank deposits recovered 265,853,823 311,887,883
Loan recovered from related parties 343,565,000 -
Loan recovered from third parties 88,783,796 507,447,092
Total 698,202,619 819,334,975
Description of other cash received related to financing activities:
None
145
(6) Other cash paid related to financing activities
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in the Amount incurred in the
Item
current period previous period
Restricted bank deposits paid 384,225,265 265,853,823
L/G expenditures on overseas loan under domestic guarantee 7,948,606 27,092,719
Disinvestment by minority shareholders 141,669,170
Related-party loan repaid 539,394,461 864,135,544
Third-party loan repaid 336,378,260 86,683,488
Total 1,409,615,762 1,243,765,574
Description of other cash paid related to financing activities :
None
79 Further information on cash flow statement
(1) Further information on cash flow statement
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item Current amount Previous amount
1. Reconciliation from net profits to cash flows from operating activities:
Net profit 416,135,431 497,121,613
Plus: provision for impairment of assets 213,647,223 52,494,284
Credit impairment loss 138,083,561 38,761,593
Depreciation of fixed assets, oil and gas assets and productive
1,236,902,853 1,227,429,642
biological assets
Amortization of right to use assets
Amortization of intangible assets 98,270,361 103,308,988
Amortization of long-term deferred expenses
Losses on disposal of fixed assets, intangible assets and other long-
-6,755,688 -49,091,913
term assets (gains expressed with “-”)
Loss on retirement of fixed assets (gains expressed with “-”)
Loss from fair value change(gains expressed with “-”) -94,172,456 -88,019,844
Financial expenses(gains expressed with “-”) 888,739,777 1,547,048,645
Investment losses (gains expressed with “-”) -413,517,783 -174,600,552
Decrease in deferred income tax assets (increase expressed with “-”) -15,800,832 66,615,331
Increase in deferred income tax liabilities (decrease expressed with “-”) 16,881,272 -45,392,624
Decrease in inventories (increase expressed with “-”) -3,780,048,380 -3,151,985,115
Increase in construction contract payment (increase expressed with “-”) -766,839,149 -531,000,142
Decrease in operating receivables (increase expressed with “-”) 288,132,036 440,854,132
Increases in operating payables (decrease expressed with “-”) 2,601,410,279 1,356,072,606
Others - -
Increase in special reserves (decrease expressed with “-”) -1,679,485 596,465
Net cash flow from operating activities 819,389,020 1,290,213,109
2. Significant investment and financing activities not involving cash deposit and withdrawal:
Conversion of debt into capital
Convertible bonds due within one year
146
2020
Item Current amount Previous amount
Fixed assets under financing lease
3. Net changes in cash and cash equivalents:
Ending balance of cash 2,897,742,340 3,068,024,976
Less: Beginning balance of cash 3,068,024,976 3,148,987,372
Plus: Ending balance of cash equivalents
Less: Beginning balance of cash equivalents
Net decrease of cash and cash equivalents -170,282,636 -80,962,396
Endorsement transfer of notes:
2020 2019
Endorsement transfer of bank acceptance bill received from sales of
2,339,442,721 3,777,188,521
goods and rendering of services
(2) Net cash paid to acquire subsidiaries in current period
□Applicable √Not applicable
(3) Net cash received from disposal of subsidiaries in current period
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item Amount
Cash or cash equivalents received in current period from the disposal of subsidiaries in
current period
Less: Cash and cash equivalents held by the Company on the date of loss of control 243,269,060
Plus: Cash or cash equivalents received in current period from disposal of subsidiaries in
previous periods
Net cash received from disposal of subsidiaries -243,269,060
Other description:
None
(4) Composition of cash and cash equivalents
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
I. Cash 2,897,742,340 3,068,024,976
Including: cash on hand 1,063,472 1,469,655
Bank deposit readily available for payment 2,896,678,868 3,066,555,321
Other monetary capital readily available for payment
Deposits with central bank available for payment
Deposits in other banks
Borrowings from other banks
II. Cash equivalents
Including: bond investment due within three months
III. Balance of cash and cash equivalents at the end of period
Including: restricted cash and cash equivalents of parent company
or subsidiaries within the Group
Other description:
□Applicable √Not applicable
147
80 Notes to items in statement of owner's equity
State the name of "other" items and the amount of adjustment to the ending balance of previous year:
□Applicable √Not applicable
81 Assets with ownership or use rights restricted
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item Book value at the end of the period Reason of restriction
Special payment collected for overseas project and
deposited in overseas supervision account and the margin
Monetary funds 50,332,396
deposit deposited for applying to the bank for letter of
credit and bank guarantee (Remark 1)
Notes receivable
Inventories
Fixed assets 2,821,018,550 Loan mortgage (Remark 2)
Intangible assets
Long-term receivables 5,614,309,162 Loan mortgage (Remark 3)
Total 8,485,660,108 /
Other description:
Remark 1: As at December 31, 2020, other monetary funds, including the restricted monetary fund of RMB 50,332,396
(as at December 31, 2019: RMB 242,272,475), were the special payment collected for overseas project and deposited in
overseas supervision account and the margin deposit deposited by the Group for applying to the bank for letter of credit and
bank guarantee.
Remark 2: As at December 31, 2020, the vessel with the book value of RMB 2,821,018,550 (December 31, 2019: the
vessel of RMB 5,439,133,909 and the mechanical equipment of RMB 255,133,376) had been used for leaseback with the
financial leasing company, with the financing term of 3 - 12 years.
Remark 3: As at December 31, 2020, the long-term receivables of “building-transfer” project of RMB 5,614,309,162
(December 31, 2019: RMB 4,482,230,928) were used as the pledge for obtaining bank loans.
82 Foreign currency monetary items
(1) Foreign currency monetary items
√Applicable □Not applicable
Unit: Yuan
Ending foreign Conversion exchange Ending balance,
Item
currency balance rate converted into RMB
Monetary fund - -
Including: USD 284,621,149 6.5249 1,857,124,535
EUR 21,496,911 8.0250 172,512,711
RUB 469,178,931 0.0877 41,146,992
KRW 5,627,507,523 0.0060 33,765,045
ZAR 41,730,270 0.4458 18,603,354
GBP 847,807 8.8903 7,537,259
INR 82,319,932 0.0888 7,310,010
AUD 712,077 5.0163 3,571,992
AED 1,661,187 1.7761 2,950,434
BRL 1,853,351 1.2065 2,236,068
MYR 1,314,236 1.6173 2,125,514
SGD 374,437 4.9314 1,846,499
148
2020
Ending foreign Conversion exchange Ending balance,
Item
currency balance rate converted into RMB
HKD 1,531,549 0.8416 1,288,952
LKR 32,292,562 0.0350 1,130,240
NZD 625 4.7050 2,941
CAD 272 5.1161 1,392
Accounts receivable - -
Including: USD 374,387,622 6.5249 2,442,841,795
EUR 107,941,563 8.0250 866,231,043
AED 96,858,817 1.7761 172,030,945
QAR 30,087,793 1.7926 53,935,378
KRW 7,719,068,270 0.0060 46,314,410
CAD 5,547,053 5.1161 28,379,278
GBP 1,741,378 8.8903 15,481,373
ZAR 29,992,419 0.4458 13,370,620
SGD 2,255,198 4.9314 11,121,283
SAR 6,132,536 1.7390 10,664,480
LKR 254,249,951 0.0350 8,898,748
HKD 7,519,443 0.8416 6,328,363
RUB 47,976,112 0.0877 4,207,505
INR 38,282,299 0.0888 3,399,468
AUD 623,830 5.0163 3,129,318
Other receivables - -
Including: USD 9,348,737 6.5249 60,999,574
RUB 273,019,534 0.0877 23,943,813
AUD 2,359,498 5.0163 11,835,950
EUR 932,593 8.025 7,484,059
ZAR 9,029,448 0.4458 4,025,328
LKR 110,692,230 0.035 3,874,228
INR 30,626,146 0.0888 2,719,602
KRW 147,541,759 0.006 885,251
HKD 562,294 0.8416 473,227
OMR 4,828 16.949 81,830
SGD 6,284 4.9314 30,989
Accounts payable - -
Including: USD 174,128,625 6.5249 1,136,171,865
EUR 43,917,097 8.0250 352,434,703
SGD 2,267,441 4.9314 11,181,659
GBP 580,777 8.8903 5,163,282
JPY 74,922,247 0.0632 4,735,086
ZAR 9,827,538 0.4458 4,381,116
RUB 35,112,520 0.0877 3,079,368
HKD 725,778 0.8416 610,815
AUD 27,427 5.0163 137,582
LKR 3,861,701 0.0350 135,160
CAD 22,295 5.1161 114,063
149
Ending foreign Conversion exchange Ending balance,
Item
currency balance rate converted into RMB
Other payables - -
Including: USD 17,792,515 6.5249 116,094,381
RUB 237,855,556 0.0877 20,859,932
EUR 31,681 8.0250 254,240
HKD 15,000 0.8416 12,624
Short-term borrowings - -
Including: USD 177,060,425 6.5249 1,155,301,567
EUR 115,017,835 8.0250 923,018,126
Long-term borrowings - -
Including: USD 150,000,000 6.5249 978,735,000
Long-term payables due within one year - -
Including: USD 70,514,317 6.5249 460,098,868
Long-term payables - -
Including: USD 206,561,199 6.5249 1,347,791,169
Other description:
None
(2) Description of overseas business entities, including the disclosure of main overseas business locations, recording
currency and selection basis for important overseas business entities, as well as the reasons for changes in recording
currency
□Applicable √Not applicable
83 Hedging
□Applicable √Not applicable
84 Government subsidies
(1) Basic information of government subsidies
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount included in current
Type Amount Item
profit or loss
Fiscal appropriation unrelated to daily
4,620,975 4,620,975
activities/ fiscal appropriation
(2) Return of government subsidies
□Applicable √Not applicable
Other description:
Not applicable
85 Others
□Applicable √Not applicable
VIII. Changes in consolidation scope
1 Business combination not under common control
□Applicable √Not applicable
150
2020
2 Business combination under common control
□Applicable √Not applicable
3 Counter purchase
□Applicable √Not applicable
4 Disposal of subsidiaries
Whether there is single disposal of investment in subsidiaries, i.e. loss of control:
□Applicable √Not applicable
Other description:
√Applicable □Not applicable
Shareholding Proportion of voting Reasons for
Registration
Business nature ratio of the Group rights enjoyed by the not being a
place
(%) group in total (%) subsidiary
CCCC Tianhe
Mechanical Equipment
Changshu City, Machine
Manufacturing Co., Ltd 32.51 55.98 Remark 1
Jiangsu Province manufacturing
(hereafter referred to as
“CCCC Tianhe”)
Remark 1: On June 4, 2020, CCCC, an affiliated company controlled by the same parent company, increased the investment
amounting to RMB 1,000,000,000 to CCCC Tianhe Mechanical Equipment Manufacturing Co., Ltd., the holding subsidiary of
the Company. On the same day, CCCC signed the capital and share increase agreement with CCCC Tianjin Dredging Co., Ltd.
(shareholder of the Company and CCCC Tianhe) and Chuwa Bussan Co. Ltd.; as stipulated in the agreement, the persons acting
in concert agreement between CCCC and ZPMC was terminated. According to the latest articles of association of CCCC Tianhe,
CCCC has the right to appoint all directors of CCCC Tianhe. Therefore, on June 4, 2020, the proportion of voting rights enjoyed
by CCCC was changed to 61.12% and the proportion of voting rights enjoyed by the Company was changed to 16.52%, so the
Company no longer had control over CCCC Tianhe. Since June 4, 2020, CCCC Tianhe would no longer be included into the
scope of combination of the Group, but would be accounted as financial assets measured at fair value through current profit or
loss. Relevant financial information of CCCC Tianhe is listed as follows:
May 31, 2020 December 31, 2019
Book value Book value
Current assets 2,748,975,021 2,278,000,630
Non-current assets 2,935,704,801 2,838,524,895
Current liabilities (3,649,803,130) (3,456,472,738)
Non-current liabilities (1,124,687,149) (645,270,749)
Total 910,189,543 1,014,782,038
Less: Minority equity (614,227,994) (684,876,398)
Less: Fair value of remaining equity (325,826,619)
Gains from disposal 29,865,070
Disposal consideration -
From the beginning of the year to the disposal date
Operating revenue 283,306,846
Operating cost 166,238,694
Net loss (1,224,958)
5 Changes in consolidation scope due to other reasons
Description of the changes (such as new subsidiary, liquidation of subsidiary) in consolidation scope due to other
reasons and relevant information:
□Applicable √Not applicable
151
6 Others
□Applicable √Not applicable
IX. Interests in other entities
1 Interests in subsidiaries
(1) Subsidiaries of the Group:
√Applicable □Not applicable
Registration Business Shareholding ratio (%) Way of
Name of subsidiary Principal place of business
place nature Direct Indirect acquisition
Shanghai Zhenhua Port Machinery Chongming, Machine Establishment
Chongming, Shanghai 94.76%
Heavy Industries Co., Ltd. Shanghai manufacturing by investing
Shanghai Zhenhua Port Machinery Establishment
Hong Kong Hong Kong Shipping 100.00%
(Hong Kong) Co., Ltd. by investing
Pudong New Establishment
Shanghai Zhenhua Shipping Co., Ltd. Pudong New Area, Shanghai Shipping 55.00%
Area, Shanghai by investing
Nantong
Nantong Zhenhua Heavy Equipment Nantong City, Jiangsu Machine Establishment
City, Jiangsu 100.00%
Manufacturing Co., Ltd. Province manufacturing by investing
Province
Nantong
ZPMC Transmission Machinery Nantong City, Jiangsu Machine Establishment
City, Jiangsu 50.75%
(Nantong) Co., Ltd. Province manufacturing by investing
Province
Electric
Pudong New equipment Establishment
ZPMC Electric Co., Ltd. Pudong New Area, Shanghai 100.00%
Area, Shanghai research and by investing
development
Yangshan
Shanghai Zhenhua Ocean Engineering Yangshan Bonded Port Area, Establishment
Bonded Port Shipping 100.00%
Service Co., Ltd Shanghai by investing
Area, Shanghai
ZPMC Machinery Equipment Services Pudong New Technical Establishment
Pudong New Area, Shanghai 100.00%
Co., Ltd. Area, Shanghai consultancy by investing
Rotterdam, Establishment
ZPMC Netherlands Coperatie U.A. Rotterdam, Netherlands Trade sales 100.00%
Netherlands by investing
Rotterdam, Establishment
ZPMC Netherlands B.V. Rotterdam, Netherlands Trade sales 100.00%
Netherlands by investing
Business
Rotterdam, Machine combination not
Verspannen B.V. Rotterdam, Netherlands 100.00%
Netherlands manufacturing under common
control
Los Barrios, Establishment
ZPMC Espana S.L. Los Barrios, Spain Trade sales 100.00%
Spain by investing
Vado Ligure Establishment
ZPMC Italia S.r.l. Vado Ligure Port, Italy Trade sales 100.00%
Port, Italy by investing
Hamburg, Establishment
ZPMC GmbH Hamburg Hamburg, Germany Trade sales 100.00%
Germany by investing
ZPMC Lanka Company (Private) Colombo, Sri Establishment
Colombo, Sri Lanka Trade sales 70.00%
Limited Lanka by investing
Establishment
ZPMC North America Inc. Delaware, USA Delaware, USA Trade sales 100.00%
by investing
Establishment
ZPMC Korea Co., Ltd. Pusan, Korea Pusan, Korea Trade sales 100.00%
by investing
Kwazulu-
Kwazulu-Natal Province, Natal Province, Establishment
ZPMC Engineering Africa (Pty) Ltd. Trade sales 100.00%
Republic of South Africa Republic of by investing
South Africa
ZPMC Engineering (India) Private Maharashtra Establishment
Maharashtra State, India Trade sales 100.00%
Limited State, India by investing
152
2020
Registration Business Shareholding ratio (%) Way of
Name of subsidiary Principal place of business
place nature Direct Indirect acquisition
ZPMC Southeast Asia Holding Pte. Establishment
Singapore Singapore Trade sales 100.00%
Ltd. by investing
ZPMC Engineering (Malaysia) Sdn. Establishment
Malaysia Malaysia Trade sales 70.00%
Bhd. by investing
New South Establishment
ZPMC Australia Company (Pty) Ltd. New South Wales, Australia Trade sales 100.00%
Wales, Australia by investing
Business
Shanghai Zhenhua Heavy Industries
Pudong New Machine combination
Port Machinery General Equipment Pudong New Area, Shanghai 100.00%
Area, Shanghai manufacturing under common
Co., Ltd.
control
Business
Shanghai Port Machinery Heavy Pudong New Machine combination
Pudong New Area, Shanghai 74.02%
Industry Co., Ltd Area, Shanghai manufacturing under common
control
Business
Zhangjiagang
ZPMC Zhangjiagang Port Machinery Zhangjiagang City, Jiangsu Machine combination
City, Jiangsu 90.00%
Co., Ltd. Province manufacturing under common
Province
control
Nanjing City,
Nanjing Ninggao New Channel Nanjing City, Jiangsu Engineering Establishment
Jiangsu 100.00%
Construction Co., Ltd Province construction by investing
Province
Business
Nantong
ZPMC Qidong Marine Engineering Nantong City, Jiangsu Machine combination not
City, Jiangsu 67.00%
Co., Ltd. Province manufacturing under common
Province
control
Establishment
Jiahua Shipping Co., Ltd. Hong Kong Hong Kong Shipping 70.00%
by investing
Zhenhua Pufeng Wind Energy Establishment
Hong Kong Hong Kong Shipping 51.00%
(HongKong) Co., Ltd. by investing
Rio DE Janeiro, Establishment
ZPMC Brazil Servio Portuários LTDA Rio DE Janeiro, Brazil Trade sales 80.00%
Brazil by investing
Establishment
ZPMC Limited Liability Company Moscow, Russia Moscow, Russia Trade sales 85.00%
by investing
Establishment
ZPMC NA East Coast lnc. Virginia Delaware, USA Trade sales 100.00%
by investing
Nantong
CCCC Investment & Development Nantong City, Jiangsu Engineering Establishment
City, Jiangsu 49.36%
Qidong Co., Ltd. (Remark 1) Province construction by investing
Province
Liyang City,
CCCC Liyang Urban Investment and Engineering Establishment
Liyang City, Jiangsu Province Jiangsu 48.00%
Construction Co., Ltd. (Remark 2) construction by investing
Province
Establishment
ZPMC UK LD Cardiff, UK Cardiff, UK Trade sales 100.00%
by investing
Establishment
ZPMC Middle East Fze Dubai, UAE Dubai, UAE Trade sales 100.00%
by investing
Huaian City,
CCCC (Huaian) Construction Engineering Establishment
Huaian City, Jiangsu Province Jiangsu 71.57%
Development Co., Ltd. construction by investing
Province
CCCC Zhenjiang Investment Zhenjiang
Zhenjiang City, Jiangsu Engineering Establishment
Construction Management City, Jiangsu 70.00%
Province construction by investing
Development Co., Ltd. Province
Wenzhou
CCCC Yongjia Construction Wenzhou City, Zhejiang Engineering Establishment
City, Zhejiang 80.00%
Development Co., Ltd. Province construction by investing
Province
Ningbo City,
CCCC Zhenhua Lvjian Technology Ningbo City, Zhejiang Engineering Establishment
Zhejiang 40.00%
(Ningbo) Co., Ltd. (Remark 3) Province construction by investing
Province
153
Registration Business Shareholding ratio (%) Way of
Name of subsidiary Principal place of business
place nature Direct Indirect acquisition
Business
Pudong New Hotel and combination not
ZPMC Hotel Co., Ltd. Pudong New Area, Shanghai 100.00%
Area, Shanghai catering under common
control
Rudong
CCCC Rudong Construction Rudong City, Jiangsu Engineering Establishment
City, Jiangsu 14.80% 55.36%
Development Co., Ltd. Province construction by investing
Province
ZPMC Latin America Holding Establishment
Panama Panama Trade sales 100.00%
Corporation by investing
Technical Establishment
Terminexus Co., Ltd. Hong Kong Hong Kong 100.00%
consultancy by investing
Business
Greenland Heavylift (Hong Kong) combination not
Hong Kong Hong Kong Shipping 50.00%
Limited (Remark 4) under common
control
Business
combination not
GPO Grace Limited Marshall Islands Marshall Islands Shipping 100.00%
under common
control
Business
combination not
GPO Amethyst Limited Marshall Islands Marshall Islands Shipping 100.00%
under common
control
Business
combination not
GPO Sapphire Limited Marshall Islands Marshall Islands Shipping 100.00%
under common
control
Business
combination not
GPO Emerald Limited Marshall Islands Marshall Islands Shipping 100.00%
under common
control
Business
combination not
GPO Heavylift Limited Cayman Islands Cayman Islands Shipping 60.00%
under common
control
Business
combination not
GPO Heavylift AS Oslo, Norway Oslo, Norway Shipping 100.00%
under common
control
Business
combination not
GPO Heavylift Pte Ltd Singapore Singapore Shipping 100.00%
under common
control
Baoding City, Intelligent Establishment
Xiong’an Zhenhua Co., Ltd. Baoding City, Hebei Province 100.00%
Hebei Province service by investing
Maritime
ZPMC Fuzhou Offshore Construction Fuzhou City, Establishment
Fuzhou City, Fujian Province engineering 100.00%
Co., Ltd. Fujian Province by investing
construction
Heze City,
CCCC (Dongming) Investment and Heze City, Shandong Engineering Establishment
Shandong 70.00%
Construction Co., Ltd. Province construction by investing
Province
Drilling Establishment
Zhenhai No. 2 Drilling Limited Hong Kong Hong Kong 100.00%
services by investing
Drilling Establishment
Zhenhai No.3 Drilling Limited Hong Kong Hong Kong 100.00%
services by investing
154
2020
Registration Business Shareholding ratio (%) Way of
Name of subsidiary Principal place of business
place nature Direct Indirect acquisition
Drilling Establishment
Zhenhai No. 5 Drilling Limited Hong Kong Hong Kong 100.00%
services by investing
Drilling Establishment
Zhenhai No. 6 Drilling Limited Hong Kong Hong Kong 100.00%
services by investing
The shareholding ratio in subsidiaries is different from the proportion of voting rights:
None
The basis for holding half or less of the voting rights but still controlling the invested entity, and the basis for holding
more than half of the voting rights but not controlling the invested entity:
None
The basis for control of the important structured entities included in the consolidation scope:
None
Basis for determining whether the Company is an agent or a principal:
None
Other description:
Remark 1: By signing the agreement for concerted action with CCCC Tianjin Dredging Co., Ltd., the Group had obtained
95% voting power in the board of shareholders and 100% voting power in the board of directors of such company (CCCC
Investment & Development Qidong Co., Ltd.). In accordance with the regulations of the articles of association of such
company, the Group had obtained the control right thereof, thus, such company was included in the Group’s sconsolidation
scope.
Remark 2: By signing the agreement for concerted action with CCCC Shanghai Dredging Co. Ltd. and CCCC East
China Investment Co., Ltd., the Group had obtained 76% voting power in the board of shareholder and 71% voting power
in the board of directors of such company (CCCC Liyang Urban Investment and Construction Co., Ltd.). In accordance with
the regulations of the articles of association of such company, the Group had obtained the control rights thereof, thus, such
company was included in the Groups’ consolidation scope.
Remark 3: By signing the agreement for concerted action with CCCC Highway Consultants Co. Ltd. and CCCC
Equipment Manufacturing Marine Heavy Industry Division, the Group had obtained 50% voting power in the board of
shareholders and 60% voting power of the board of directors of such company (CCCC Zhenhua Lvjian Technology (Ningbo)
Co., Ltd.). In accordance with the regulations of the articles of association of such company, the Group had obtained the
control right thereof, thus, such company was included in the Group’s consolidation scope.
Remark 4: In accordance with the acquisition agreement, the Group held two of the four seats in the board of directors
of such company (Greenland Heavylift (Hong Kong) Limited), including chairman of the board. As required in the articles of
association of such company, the chairman of the board has super voting power when the voting of the board is deadlocked.
In addition, Group also has the right to buy 1% equity of such company at USD 1 at any time in the future. Therefore, the
Group has the substantial control over such company, and such company was included in the Group’s consolidation scope
for the financial statements.
(2) Major non-wholly-owned subsidiaries
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Profit or loss Balance of minority
Shareholding Dividends declared to
attributable to the shareholders' equity
Name of subsidiary ratio of minority minority shareholders
minority shareholder at the end of the
shareholder in current period
in current period period
ZPMC Transmission Machinery
49.25% 44,043,728 -31,907,452 826,201,602
(Nantong) Co., Ltd.
CCCC Zhenjiang Investment
Construction Management 30% 9,907,132 -14,523,578 203,991,836
Development Co., Ltd.
Greenland Heavylift
50% -44,329,031 248,026,815
(HongKong) Limited
Description of the difference between the shareholding ratio of minority shareholders and the proportion of voting right
ratio in subsidiaries:
□Applicable √Not applicable
155
Other description:
√Applicable □Not applicable
Subsidiaries with significant minority equity:
2020
Capital Special Accumulated
Shareholding Profit or loss Dividends
contributed / reserves minority
ratio of attributable to paid to
(withdrawn) withdrawn equity at the
minority the minority minority
by minority by minority end of the
shareholder shareholder shareholder
shareholder shareholder year
ZPMC Transmission
Machinery (Nantong) 49.25% 200,000,000 44,043,728 (31,907,452) - 826,201,602
Co., Ltd.
CCCC Zhenjiang
Investment Construction
30.00% (141,669,170) 9,907,132 (14,523,578) - 203,991,836
Management
Development Co., Ltd.
Greenland Heavylift
50.00% - (44,329,031) - - 248,026,815
(HongKong) Limited
2019
Changes in
Profit
accounting Special
Shareholding Capital or loss Accumulated
policies - Dividends paid reserves
ratio of contributed attributable minority equity
Application of to minority withdrawn
minority by minority to the at the end of
new financial shareholder by minority
shareholder shareholder minority the year
instrument shareholder
shareholder
standard
CCCC Tianhe
Mechanical Equipment 67.49% - (6,011,469) 48,481,428 - 53,477 684,876,399
Manufacturing Co., Ltd
ZPMC Transmission
Machinery (Nantong) 49.25% 614,065,326 - - - - 614,065,326
Co., Ltd.
CCCC Zhenjiang
Investment
Construction 30.00% - - 14,514,024 - - 350,277,452
Management
Development Co., Ltd.
Greenland Heavylift
50.00% - - (2,667,244) (973,150) - 292,355,846
(HongKong) Limited
(3) Main financial information of major non-wholly-owned subsidiaries
√Applicable □Not applicable
Unit: Yuan Currency: CNY
December 31, 2020
Name of subsidiary Current Non-current Current Non-current
Total assets Total liabilities
assets assets liabilities liabilities
CCCC Zhenjiang Investment
Construction Management 733,178,647 14,701 733,193,348 -53,220,561 -53,220,561
Development Co., Ltd.
Greenland Heavylift
121,027,739 1,953,698,858 2,074,726,597 -455,304,675 -1,130,294,502 -1,585,599,177
(HongKong) Limited
ZPMC Transmission
1,439,325,230 394,262,258 1,833,587,488 -156,331,859 - -156,331,859
Machinery (Nantong) Co., Ltd.
156
2020
December 31, 2020
Name of subsidiary Current Non-current Current Non-current
Total assets Total liabilities
assets assets liabilities liabilities
CCCC Tianhe Mechanical
Equipment Manufacturing
Co., Ltd
December 31, 2019
Name of subsidiary Current Non-current Current Non-current
Total assets Total liabilities
assets assets liabilities liabilities
CCCC Zhenjiang Investment
Construction Management 377,510,693 853,738,541 1,231,249,234 -63,657,726 -63,657,726
Development Co., Ltd.
Greenland Heavylift
105,658,741 2,139,263,095 2,244,921,836 -429,544,507 -1,233,274,882 -1,662,819,389
(HongKong) Limited
ZPMC Transmission
Machinery (Nantong) Co., 1,061,226,741 393,323,378 1,454,550,119 -207,716,971 -207,716,971
Ltd.
CCCC Tianhe Mechanical
Equipment Manufacturing 2,245,394,111 2,871,131,414 5,116,525,525 -3,456,472,738 -645,270,749 -4,101,743,487
Co., Ltd
Amount incurred in the current period
Name of subsidiary Operating Total comprehensive Cash flows from
Net profit
revenue income operating activities
CCCC Zhenjiang Investment Construction
33,023,773 33,023,773 517,498,836
Management Development Co., Ltd.
Greenland Heavylift (HongKong) Limited 261,736,949 -54,103,269 -88,658,061 6,619,732
ZPMC Transmission Machinery (Nantong) Co., Ltd. 736,059,047 89,433,610 89,433,610 66,499,450
CCCC Tianhe Mechanical Equipment
Manufacturing Co., Ltd
Amount incurred in the previous period
Name of subsidiary Operating Total comprehensive Cash flows from
Net profit
revenue income operating activities
CCCC Zhenjiang Investment Construction
48,380,079 48,380,079 -256,615,368
Management Development Co., Ltd.
Greenland Heavylift (HongKong) Limited 245,078,363 -16,628,814 -7,122,338 95,869,438
ZPMC Transmission Machinery (Nantong) Co., Ltd. 650,913,183 47,393,360 47,393,360 14,617,991
CCCC Tianhe Mechanical Equipment
1,163,944,626 71,810,934 71,810,934 55,406,683
Manufacturing Co., Ltd
Other description:
None
(4) Major restrictions on the use of assets of enterprise group and the repayment of debts of enterprise group
□Applicable √Not applicable
(5) Financial support or other supports provided to structured entities included in the scope of consolidated financial
statements
□Applicable √Not applicable
Other description:
□Applicable √Not applicable
2 Transactions in which the owner's equity share of a subsidiary changes and the subsidiary is still under control
□Applicable √Not applicable
157
1.Equity in joint ventures and associates
√Applicable □Not applicable
(1) Major joint ventures or associates
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Principal Shareholding ratio (%)
Registration Accounting
Name of joint venture or associate place of Business nature
place Direct Indirect treatment
business
Joint ventures
Jiangsu Longyuan Zhenhua Marine Marine engineering
Jiangsu Nantong, Jiangsu 50% Equity method
Engineering Co., Ltd construction
ZPMC Mediterranean Liman Istanbul, Technical service
Istanbul, Turkey 50% Equity method
Makinalari Ticaret Anonim Sirketi Turkey for port equipment
Zhenhua Marine Energy (HK) Co., Ltd. Hong Kong Hong Kong Shipping 51% Equity method
Technical service
Cranetech Global Sdn.Bhd. Malaysia Malaysia 49.99% Equity method
for port equipment
ZPMC-OTL MARINE CONTRACTOR
Hong Kong Hong Kong Shipping 50% Equity method
LIMITED
Associates
Marine technology
CCCC Marine Engineering & Pudong New Area,
Shanghai development and 25% Equity method
Technology Research Center Co., Ltd. Shanghai
consulting
Real estate
CCCC Estate Yixing Co., Ltd. Jiangsu Wuxi, Jiangsu 20% Equity method
development
Changzhou,
ZPMC Changzhou Coatings Co., Ltd Jiangsu Paint manufacture 20% Equity method
Jiangsu
Pudong New Area,
CCCC Financial Leasing Co., Ltd Shanghai Finance lease 30% Equity method
Shanghai
CCCC Yancheng Construction Engineering project
Jiangsu Yancheng, Jiangsu 25% Equity method
Development Co., Ltd. construction
Suzhou Chuanglian Electric Drive Co., Electric equipment
Jiangsu Suzhou, Jiangsu 20% Equity method
Ltd. manufacturing
Port, channel,
China Communications Construction
USA USA highway and bridge 24% Equity method
USA Inc.
construction
Port, channel,
CCCC South American Regional
USA USA highway and bridge 17% Equity method
Company SARL
construction
ZPMC Southeast Asia Pte. Ltd. Singapore Singapore Trade sales 40% Equity method
Shanghai Ocean Engineering Development of
Equipment Manufacturing Innovation Shanghai China ocean engineering 8.97% Equity method
Center Co., Ltd. technology
Shanghai Xingyi Construction Building
Shanghai Shanghai 30% Equity method
Technology Co., Ltd. engineering
CCCC Xiongan Urban Construction Engineering project
Hebei Xiongan, Hebei 15.00% Equity method
Development Co., Ltd. construction
Description of the difference between shareholding ratio and proportion of voting rights in joint venture or associates:
None
Basis for holding less than 20% of voting rights but having significant influence, or holding 20% or more of voting rights
but not having significant influence:
None
(2) Main financial information of major joint ventures:
□Applicable √Not applicable
158
2020
(3) Main financial information of major associates:
√Applicable □Not applicable
Unit: Yuan Currency: CNY
December 31, 2020/Amount incurred December 31, 2019/Amount incurred in
in the current period the previous period
CCCC Financial CCCC Financial CCCC Financial CCCC Financial
Leasing Co., Ltd Leasing Co., Ltd Leasing Co., Ltd Leasing Co., Ltd
Current assets 22,819,943,898 - 19,939,324,543 -
Non-current assets 24,486,499,994 - 21,339,769,559 -
Total assets 47,306,443,892 - 41,279,094,102 -
Current liabilities -20,424,045,460 - -21,496,787,586 -
Non-current liabilities -16,947,008,625 - -11,265,256,085 -
Total liabilities -37,371,054,085 - -32,762,043,671 -
Minority equity 2,697,430,648 - 2,565,417,538 -
Other equity instrument - Perpetual bond 998,000,000 - - -
Shareholders’ equity attributable the parent
6,239,959,159 - 5,951,632,893 -
company
Share of net assets held based on shareholding
1,883,150,758 - 1,785,702,878 -
ratio
Adjustments - - - -
--Goodwill - - - -
--Unrealized profits of internal transactions - - - -
--Others - - - -
Book value of equity investment in associates 1,883,150,758 - 1,785,702,878 -
Fair value of equity investment in associates with
- - - -
public offer
Operating revenue - 2,740,010,098 - 2,052,054,187
Financial expenses-interest income - 17,688,700 - 18,917,032
Financial expenses - interest expenses - 52,265,036 - 51,051,246
Income tax expenses - 214,170,405 - 126,731,537
Net profit - 526,789,103 - 386,156,164
Net profit from discontinuing operation - - - -
Other comprehensive income - - - -
Net of tax of other comprehensive income - -4,238,920 - 1,034,782
Total comprehensive income - 522,550,183 - 387,190,946
Total comprehensive income attributable to the
- 390,537,074 - 298,442,527
parent company
Dividends received from associates in the current
- - - -
year
Dividends distributed - 102,210,808 - 32,500,000
Including: dividends distributed to investors of
- 36,500,000 - -
other equity instruments
Other description
None
159
(4) Summary of financial information of insignificant joint ventures and associates:
√Applicable □Not applicable
Unit: Yuan Currency: CNY
December 31, 2019/Amount
December 31, 2020/Amount
incurred in the previous
incurred in the current period
period
Joint ventures:
Total book value of investment 277,261,963 312,812,059
Total number of following items by shareholding ratio
-- Net profit 11,542,458 17,192,511
-- Other comprehensive income
-- Total comprehensive income 11,542,458 17,192,511
Associates:
Total book value of investment 881,820,163 775,158,808
Total number of following items by shareholding ratio
-- Net profit 8,917,689 4,309,481
-- Other comprehensive income -27,392,214 -2,315,141
-- Total comprehensive income -18,474,525 1,994,340
Other description
None
(5) Description of the significant restrictions on the ability of joint ventures or associates to transfer funds to the
Company
□Applicable √Not applicable
(6) Excess loss of joint ventures or associates
□Applicable √Not applicable
(7) Unrecognized commitments related to joint venture investment
□Applicable √Not applicable
(8) Contingent liabilities related to investment in joint ventures or associates
□Applicable √Not applicable
3 Significant joint operation
□Applicable √Not applicable
4 Equity in structured entities not included in the scope of consolidated financial statements
Description of structured entities not included in the scope of consolidated financial statements:
□Applicable √Not applicable
5 Others
□Applicable √Not applicable
X. Risks related to financial instruments
√Applicable □Not applicable
1 Classification of financial instruments
The book values of various financial instruments on the balance sheet date:
160
2020
2020
Financial assets
Financial assets measured at Financial assets measured at
fair value through the current Measured at fair value through the other
Total
profit or loss amortized cost comprehensive income
Standard Designated Standard Designated
Monetary funds - - 2,948,074,736 - - 2,948,074,736
Held-for-trading financial
1,601,623,650 - - - - 1,601,623,650
assets
Notes receivable - - 753,000 - - 753,000
Receivables financing - - - 362,006,319 - 362,006,319
Accounts receivable - - 7,227,065,255 - - 7,227,065,255
Other receivables - - 321,158,686 - - 321,158,686
Non-current assets due
- - 1,884,370,444 - - 1,884,370,444
within one year
Investment in other equity
- - - - 61,505,751 61,505,751
instruments
Long-term receivables - - 5,077,114,342 - - 5,077,114,342
Other non-current financial
330,094,057 - - - - 330,094,057
assets
1,931,717,707 - 17,458,536,463 362,006,319 61,505,751 19,813,766,240
Financial liabilities
Financial liabilities measured at fair Financial liabilities
value through the current profit or loss measured at Total
Standard Designated amortized cost
Short-term borrowings - - 17,795,076,565 17,795,076,565
Held-for-trading financial liabilities 458,882 458,882
Notes payable - - 3,600,725,892 3,600,725,892
Accounts payable - - 7,773,903,147 7,773,903,147
Other payables - - 465,042,916 465,042,916
Non-current liabilities due within one year - - 1,374,465,319 1,374,465,319
Long-term borrowings - - 16,850,299,742 16,850,299,742
Long-term payables - - 1,632,757,932 1,632,757,932
458,882 - 49,492,271,513 49,492,730,395
2019
Financial assets
Financial assets measured at Financial assets measured at
fair value through the current Measured at fair value through the other
Total
profit or loss amortized cost comprehensive income
Standard Designated Standard Designated
Monetary funds - - 3,310,297,451 - - 3,310,297,451
Held-for-trading financial
1,739,792,062 - - - - 1,739,792,062
assets
Notes receivable - - 5,650,000 - - 5,650,000
161
Financial assets measured at Financial assets measured at
fair value through the current Measured at fair value through the other
Total
profit or loss amortized cost comprehensive income
Standard Designated Standard Designated
Receivables financing - - - 406,408,604 - 406,408,604
Accounts receivable - - 4,966,175,528 - - 4,966,175,528
Other receivables - - 546,907,645 - - 546,907,645
Non-current assets due
- - 1,313,203,581 - - 1,313,203,581
within one year
Investment in other equity
- - - - 61,981,268 61,981,268
instruments
Long-term receivables - - 5,227,728,420 - - 5,227,728,420
1,739,792,062 - 15,369,962,625 406,408,604 61,981,268 17,578,144,559
Financial liabilities
Financial liabilities measured at fair Financial liabilities
value through the current profit or loss measured at amortized Total
Standard Designated cost
Short-term borrowings - - 22,001,319,380 22,001,319,380
Held-for-trading financial liabilities 7,312,741 - - 7,312,741
Notes payable - - 3,420,945,451 3,420,945,451
Accounts payable - - 7,869,378,365 7,869,378,365
Other payables - - 694,418,175 694,418,175
Non-current liabilities due within one year - - 7,287,484,513 7,287,484,513
Long-term borrowings - - 8,413,339,986 8,413,339,986
Long-term payables - - 1,741,945,636 1,741,945,636
7,312,741 - 51,428,831,506 51,436,144,247
2 Transfer of financial assets
Transferred financial assets derecognized as a whole but involved continuously
As at December 31, 2020, the book value of the bank acceptance bill given by the Group upon endorsement to the
supplier for accounts payable settlement amounted to RMB 571,531,799 (December 31, 2019: RMB 738,496,754). As at
December 31, 2020, the maturity term of such bill was 1 - 12 months. In accordance with the relevant provisions of the
Negotiable Instruments Law, if the acceptance bank refuses to pay, the bill holder shall be entitled to recourse to the Group
(“continue to be involved”).The Group considered that it had transferred almost all risks and rewards of such bill, therefore,
the aforesaid book value and the book value of relevant settled accounts payable should be derecognized as a whole.
The maximum losses and undiscounted cash flows that continue to be involved were equal to the book value. The Group
considered that the fair value with continuous involvement was insignificant.
In 2020, the Group failed to recognized relevant gain or loss on the date of transfer of the above financial assets (Year
2019: None).The Group had no income or expense which had been recognized for the current year or accumulatively
as it had been derecognized as a whole but continued to be involved in the financial assets. The endorsement of bank
acceptance bill receivable happened in this year evenly.
3 Financial instrument risks
Various financial instrument risks the Group faces during the routine activities mainly include the credit risk, liquidity risk
and market risk (including the exchange rate risk and interest rate risk). Main financial instruments of the Group include the
monetary funds, equity investment, borrowings, notes receivable, accounts receivable, accounts receivable financing, long-
term receivables, notes payable and accounts payable.
The Group's overall risk management plan is targeted at the unpredictability of financial market, trying to minimize the
potential adverse influence on the Group’s financial results.
162
2020
Credit risk
The Group manages the credit risks by the classification of portfolios. The credit risk is mainly from accounts receivable
financing, accounts receivable, other receivables and long-term receivables.
Other financial assets of the Group include monetary funds, held-for-trading financial assets, other equity investment
instruments and other non-current financial assets, of which credit risks are from the counterpart's default, and the maximum
exposure is equal to the book amount of these instruments.
The Group only trade with the authorized third parties in good standing. Credit risks are managed in a centralized
manner by customer/counterpart, geographic region and industry. As the Group’s customers of accounts receivable and
long-term receivables are widely dispersed across sectors and industries, there is no significant credit risk concentration
within the Group. The Group did not hold any collateral or other credit enhancements for the balance of accounts receivable
and long-term receivables, but did the same for the balance of long-term receivables.
As the counterparts of monetary funds, receivables financing and derivative financial instruments are banks in good
standing and having relatively higher credit rating, these financial instruments have low credit risk.
In addition, as for the receivables financing, accounts receivable financing, accounts receivable, other receivables, and
long-term accounts receivable, the Group has set relevant policies to control the credit risk exposure. The Group, based on
the customers' financial positions, the possibility of obtaining guarantees from the third party, credit records and other factors
such as the current market conditions, evaluates the credit qualifications of customers and set the credit period accordingly.
The Group will monitor customers’ credit records periodically; as for the customers with bad credit records, the Group will
take measures, such as requesting a payment in writing, shortening the credit period or canceling the credit term, to ensure
that the Group's overall credit risks are within the controllable scope.
Judgment criteria for significant increase in credit risk
On each balance sheet date, the Group will evaluate the credit risks of relevant financial instruments to confirm whether
they have had significant increase or not after the initial recognition. On such confirmation, the Group will consider the
reasonable and well-founded information which can be obtained without paying unnecessary surcharge or effort, including
the information on qualitative and quantitative analysis based on the Group’s historical date, external credit risk rating and
perspectiveness. Based on the individual financial instrument or portfolio of financial instruments with similar credit risk
characteristics, the Group determines the changes in default risk in financial instruments during the estimated duration by
comparing the default risks in financial instruments on the balance sheet date with those on the initial recognition date.
In case of one or more quantitative or qualitative standards, the Group will consider that the credit risk of a financial
instrument has had significant increase:
(1) The quantitative standard mainly refers to the situation that the reporting date is overdue for certain days.
(2) The qualitative standard mainly refers to the situation that the debtor encounters any significant and adverse
operating or financial change, or prepares the list of warning customers.
Definition of assets with credit impairment
In order the determine whether there is credit impairment, the Group adopts a definition standard to keep pace with the
internal credit risk management target regarding relevant financial instruments, and takes the quantitative and qualitative
indicators into account. The Group mainly considers the following factors on evaluating whether the debtor has had credit
impairment:
(1)The issuer or the debtor suffers significant financial difficulties;
(2)The debtor violates any contract, such as default or delay in repayment of interest or principal;
(3)Considering the economic or contractual reasons relevant to the debtor’s financial difficulty, the debtor makes
concession which it will not make in any other circumstance;
(4)The debtor is likely to go bankrupt or carry out other financial reorganization;
(5)The active market of such financial assets disappears due to the issuer’s or the debtor’s financial difficulty;
(6)A financial asset is purchased or generated through the substantial discount, and such discount reflects the fact of
credit loss.
The credit impairment of financial assets may be caused by several events, not just one event which can be individually
identified.
Parameters for the measurement of expected credit loss
Based on the information whether the credit risk has had significant increase or there is credit impairment, the Group
makes the provision for impairment of expected credit losses of various assets for 12 months or the entire duration. Key
parameters for the measurements of expected credit loss include the probability of default, loss given default and exposure
at default. Considering the quantitative analysis on historical statistical data (including the rating of the counterpart, way of
guarantee and category of collateral) and prospective information, the Group builds models for probability of default, loss
given default and exposure at default.
163
Relevant definitions:
(1)The probability of default refers to the probability that the debtor may fail to perform the payment obligation over the
next 12 months or the entire duration. The Group’s probability of default is adjusted based on the credit loss model, adding
the prospective information to reflect the debtor's probability of default in the current macroeconomic environment;
(2)The loss given default refers to the expectation made by the Group regarding the degree of loss on default risk
exposure. As the type of counterpart, way of recourse and priority as well as collateral may be different, the loss given default
may also be different. The loss given default refers to the percentage of the risk exposure loss at default, calculated based
on the term of future 12 months or the entire duration;
(3)The exposure at default refers to the amount paid by the Group at default over the next 12 months or the entire
remaining duration.
The prospective information is involved in the evaluation on significant change in credit risk and the calculation of
expected credit loss. Through the historical data analysis, the Group identifies the key economic indicators affecting the
credit risks in various types of business and the expected credit loss.
The impact of these economic indicators on the probability of default and the loss given default is different for different
type of business. In such course, the Group makes the reference to the authoritative predictive values, expect these
economic indicators based on results of those values, and determine the impact of these economic indicators on the
probability of default and the loss given default.
2020
The maximum risk exposure and the year-end classification of credit risk degrees regarding the Group’s financial assets
and contract assets are as follows:
Estimated credit loss
Estimated credit loss in the entire lifecycle
over the next 12 months Total
Stage I Stage II Stage III Simple method
Monetary funds 2,948,074,736 - - - 2,948,074,736
Held-for-trading financial assets 1,601,623,650 - - - 1,601,623,650
Notes receivable 753,000 - - - 753,000
Accounts receivable - - - 7,227,065,255 7,227,065,255
Contract assets - - - 2,063,296,890 2,063,296,890
Receivables financing 362,006,319 - - - 362,006,319
Other receivables 836,659,904 76,750,259 913,410,163
Non-current assets due within one year 1,884,370,444 - - - 1,884,370,444
Other non-current financial assets 330,094,057 - - - 330,094,057
Other non-current assets - - - 702,933,384 702,933,384
Long-term receivables 5,077,114,342 - - - 5,077,114,342
13,040,696,452 76,750,259 - 9,993,295,529 23,110,742,240
2019
Estimated credit loss
Estimated credit loss in the entire lifecycle
in future 12 months Total
Stage I Stage II Stage III Simple method
Monetary funds 3,310,297,451 - - - 3,310,297,451
Held-for-trading financial assets 1,739,792,062 - - - 1,739,792,062
Notes receivable 5,650,000 - - - 5,650,000
Accounts receivable - - - 4,966,175,528 4,966,175,528
Receivables financing 406,408,604 - - - 406,408,604
Other receivables 1,097,763,737 78,797,771 - - 1,176,561,508
Non-current assets due within one year 1,313,203,581 - - - 1,313,203,581
Long-term receivables 5,227,728,420 - - - 5,227,728,420
13,100,843,855 78,797,771 - 4,966,175,528 18,145,817,154
164
2020
Liquidity risk
Subsidiaries within the Group are responsible for their own cash-flow prospects. The financial section of the head
office continues to monitor the short-term and long-term capital demands at the group level after collecting the cash flows
prospects of all subsidiaries, to guarantee the sufficient cash reserve and cashable securities. Meanwhile, the financial
section of the head office continues to monitor the financial and non-financial indicators prescribed in credit-granting
agreements and loan agreements, to ensure that the Group can get sufficient line of credit from major financial institutions,
so as to satisfy the short-term and long-term capital demands of all subsidiaries of the Group.
As at December 31, 2020, the various financial liabilities of the Group are listed as follows by due dates based on
undiscounted contracted cash flows (including principal and interest):
2020
Within 1 year 1-2 years 2-5 years Over 5 years Total
Short-term borrowings 18,041,418,617 - - - 18,041,418,617
Held-for-trading financial liabilities 458,882 - - - 458,882
Notes payable 3,600,725,892 - - - 3,600,725,892
Accounts payable 7,773,903,147 - - - 7,773,903,147
Other payables 481,065,700 - - - 481,065,700
Non-current liabilities due within one
1,480,593,478 - - - 1,480,593,478
year
Long-term borrowings - 2,448,871,944 14,087,369,245 1,621,865,690 18,158,106,879
Long-term payables - 555,681,491 579,063,124 805,440,349 1,940,184,964
31,378,165,716 3,004,553,435 14,666,432,369 2,427,306,039 51,476,457,559
As at December 31, 2019, the various financial liabilities of the Group are listed as follows by due dates based on
undiscounted contracted cash flows (including principal and interest):
2019
Within 1 year 1-2 years 2-5 years Over 5 years Total
Short-term borrowings 22,371,944,008 - - - 22,371,944,008
Held-for-trading financial liabilities 7,312,741 - - - 7,312,741
Notes payable 3,420,945,451 - - - 3,420,945,451
Accounts payable 7,869,378,365 - - - 7,869,378,365
Other payables 711,389,996 - - - 711,389,996
Non-current liabilities due within one
7,533,454,596 - - - 7,533,454,596
year
Long-term borrowings - 2,959,780,013 5,249,838,271 879,572,205 9,089,190,489
Long-term payables - 683,803,609 535,717,708 609,414,984 1,828,936,301
41,914,425,157 3,643,583,622 5,785,555,979 1,488,987,189 52,832,551,947
Market risk
Interest rate risk
The Group’s interest rate risk is mainly from such long-term interest-bearing liabilities as long-term bank borrowings and
long-term payables. Floating-rate financial liabilities expose the Group to cash flow interest rate risk while fixed-rate financial
liabilities expose the Group to fair value interest rate risk. The Group determines the relative proportion of contracts with
fixed interest rate and contracts with floating interest rate according to the current market environment. As at December 31,
2020, the Group’s long-term interest-bearing liabilities mainly were the floating rate contracts priced in USD, and the fixed
rate contracts priced in RMB.
The market interest rate fluctuating risks that the Group encounters are mainly relevant to the long-term liabilities where
the interest is calculated at the floating interest rate.
The finance department in the headquarters of the Group continues monitoring and controlling the interest rate level of
the Group. The increase in interest rate will increase the costs of the new interest-bearing debts and the interest expenses
of interest-bearing debts failing to be paid up by the Group and subject to the interest calculation at floating interest rate,
and will, significantly and adversely, affect the Group's financial results; the management will control partial interest rate risk
based on the newest market situation through the swap contract and other interest rate swap arrangements. In 2020 and
2019, the Group had no interest rate swap arrangement.
165
The following table shows the sensitivity analysis of the interest rate risk, reflecting the effect of the reasonable and
possible changes in the interest rate on net profit or loss (through the impact on loan with floating interest rate) and the net
amount of other comprehensive income after tax, based on the assumption of no change in other variables.
2020
Base point Net profit or loss Net of tax of other comprehensive Total shareholders' equity
Increase / (Decrease) Increase / (Decrease) income Increase / (Decrease) Increase / (Decrease)
RMB 100 (34,223,642) - (34,223,642)
RMB (100) 34,223,642 - 34,223,642
2019
Base point Net profit or loss Net of tax of other comprehensive Total shareholders' equity
Increase / (Decrease) Increase / (Decrease) income Increase / (Decrease) Increase / (Decrease)
RMB 100 (58,026,976) - (58,026,976)
RMB (100) 58,026,976 - 58,026,976
Exchange rate risk
The Group is exposed to transactional exchange rate risk. Such risks are due to sales or purchases made by the
operating entity in currencies other than its functional currency. The Group’s main production is within the territory of China,
but its sales and purchase is settled in USD. However, there still were foreign exchange risks in the foreign currency assets
and liabilities and future foreign currency transactions that have been recognized by the Group (foreign currency assets and
liabilities and foreign currency transactions are priced mainly in USD). The finance department of the Headquarters of the
Group is responsible for supervising the scale of the Group's foreign currency transactions and foreign currency assets and
liabilities to minimize the foreign exchange risks.
The following table is a sensitivity analysis of exchange rate risk, reflecting the assumption that all other variables will
remain the same, when the USD exchange rate changes reasonably and possibly, it will affect the net profit or loss (due to
the change in fair value of monetary assets and liabilities) and other comprehensive income, net of tax (due to the change in
fair value of forward foreign exchange contract).
2020
USD exchange rate Net profit or loss Net of tax of other comprehensive Total shareholders' equity
Increase / (Decrease) Increase / (Decrease) income Increase / (Decrease) Increase / (Decrease)
RMB appreciation
1% 15,995,421 - 15,995,421
against USD
RMB depreciation
(1%) (15,995,421) - (15,995,421)
against USD
2019
USD exchange rate Net profit or loss Net of tax of other comprehensive Total shareholders' equity
Increase / (Decrease) Increase / (Decrease) income Increase / (Decrease) Increase / (Decrease)
RMB appreciation
1% 40,098,106 - 40,098,106
against USD
RMB depreciation
(1%) (40,098,106) - (40,098,106)
against USD
Price risk of equity instrument investment
The price risk of equity instrument investment refers to the risk that the fair value of equity securities decreases due
to the change of stock index level and individual securities value. As at December 31, 2020, the Group was exposed to
the price risk of equity instrument investment arising from the individual equity instrument investment classified as equity
instrument investment measured at fair value through the current profit or loss. The listed equity instrument investment
held by the Group is listed on the stock exchanges of Shanghai, Shenzhen and Hong Kong, and measured at the market
quotation on the balance sheet date.
The market stock indexes of the following stock exchanges at the closing of the trading day closest to the balance sheet
date, as well as their respective highest and lowest closing points in the year:
166
2020
At the end of 2020 Highest / lowest in 2020 At the end of 2019 Highest / lowest in 2019
Shanghai - A-share index 3,649 3,912/2,774 3,196 3,426/2,580
Shenzhen - A-share index 2,438 2,442/1,683 1,802 1,865/1,303
Hong Kong - Hang Seng Index 27,231 29,175/21,139 28,190 30,157/25,064
The following table shows the sensitivity of the Group's net profit or loss to the change of 1% of the fair value of equity
instrument investment (based on the book value on the balance sheet date) under the assumption that all other variables
remain unchanged.
2020
Book value Increase / Increase / (decrease) Increase /
of equity (decrease) in net of tax of other (decrease) in total
instrument in net profit comprehensive shareholders'
investment or loss income equity
Equity instrument investment
Shanghai - equity instrument investment measured at fair
679,011,665 5,771,599 - 5,771,599
value through the current profit or loss
Shenzhen - equity instrument investment measured at fair
229,296,774 1,949,023 - 1,949,023
value through the current profit or loss
Hong Kong - equity instrument investment measured at fair
684,876,933 5,718,722 - 5,718,722
value through the current profit or loss
Investment in unlisted equity instruments measured at fair
value
- Equity instrument investment measured at fair value through
330,094,057 2,805,799 - 2,805,799
the current profit or loss
- Equity instrument investment measured at fair value through
61,505,751 - 522,799 522,799
the other comprehensive income
2019
Book value Increase / Increase / (decrease) Increase /
of equity (decrease) in net of tax of other (decrease) in total
instrument in net profit comprehensive shareholders'
investment or loss income equity
Equity instrument investment
Shanghai - equity instrument investment measured at fair value
585,555,555 4,977,222 - 4,977,222
through the current profit or loss
Shenzhen - equity instrument investment measured at fair
133,330,676 1,132,191 - 1,132,191
value through the current profit or loss
Hong Kong - equity instrument investment measured at fair
990,232,309 8,268,440 - 8,268,440
value through the current profit or loss
Investment in unlisted equity instruments measured at fair
value
- Equity instrument investment measured at fair value through
61,981,268 - 526,841 526,841
the other comprehensive income
4 Capital management
The Group’s objectives of capital management policy are to safeguard the Group’s ability to continue as a going concern
in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to
reduce the cost of capital.
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders,
return capital to shareholders, issue new shares or sell assets to reduce debt.
The total capital of the Group is the shareholders' equity as listed in the consolidated balance sheet. The Group is not
subject to external mandatory capital requirements and makes use of the asset-liability ratio to monitor capital. This ratio
is calculated by the net debt divided by total capital. The net debt is the total borrowing (including Short-term borrowings
listed in the consolidated balance sheet, other non-current liabilities due within one-year, Long-term borrowings, other
payables and interest-bearing liabilities in long-term payables) minus cash and cash equivalents. The total capital is the total
shareholders’ equity plus net debt.
167
As at December 31, 2020 and December 31, 2019, the liability ratio of the Group is listed as follows:
2020 2019
Debt ratio 67% 67%
XI. Fair value disclosure
1 Ending fair value of assets and liabilities measured at fair value
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Ending fair value
Item Fair value Fair value Fair value
measurement measurement measurement Total
at level 1 at level 2 at level 3
I. Continuous fair value measurement
(I) Held-for-trading financial assets 1,593,185,372 8,438,278 1,601,623,650
1. Financial assets measured at fair value through the current profit
1,593,185,372 8,438,278 1,601,623,650
or loss
(1) Debt instrument investment
(2) Equity instrument investments
(3) Derivative financial assets 8,438,278 8,438,278
(4) Equity of listed companies 1,593,185,372 1,593,185,372
2. Financial assets designated to be measured at fair value through
the current profit or loss
(1) Debt instrument investment
(2) Equity instrument investments
(II) Other debt investment
(III) Investment in other equity instruments 61,505,751 61,505,751
(IV) Investment property
1. Land use right for lease
2. Buildings for lease
3. Land use right held for transfer after appreciation
(V) Biological assets
1. Consumptive biological assets
2. Productive biological assets
(VI) Receivables financing 362,006,319 - 362,006,319
(VII) Other non-current financial assets 330,094,057 330,094,057
Total assets measured with continuous fair value continuously 1,593,185,372 362,006,319 400,038,086 2,355,229,777
(VI) Held-for-trading financial liabilities
1. Financial liabilities measured at fair value through current profit or
loss
Including: Trading bonds issued
Derivative financial liabilities
Others
2. Financial liabilities designated to be measured at fair value through
the current profit or loss
Forward foreign exchange contract 458,882 458,882
Total liabilities measured with continuous fair value continuously 458,882 458,882
II. Non-continuous fair value measurement
168
2020
Ending fair value
Item Fair value Fair value Fair value
measurement measurement measurement Total
at level 1 at level 2 at level 3
(I) Assets held for sale
Total assets not continuously measured at fair value
Total liabilities not continuously measured at fair value
2 The basis for determining the market value of continuous and non-continuous fair value measurement items at level 1
□Applicable √Not applicable
3 Valuation techniques and the qualitative and quantitative information of important parameters for continuous
and non-continuous fair value measurement items at level 2
√Applicable □Not applicable
The Group regards the date when the conversion of levels occurs as the time point of the conversion of all levels. There
was no conversion among levels in this year.
Where there is an active market traded for a financial instrument, the Group shall adopt the quoted price in the active
market to determine the fair value thereof; where there is no active market traded for a financial instrument, the Group shall
adopt value appraisal techniques to determine its fair value. The valuation models used are discounted cash flow model and
market comparable company model. The input value of valuation techniques mainly includes the weighted average cost of
capital, liquidity discount, price to book ratio of comparable companies.
Relevant information about the measurement of fair value at level 2 is as follows:
2020 Observable input value
Valuation technique
Fair value Name Scope
Receivables financing 362,006,319 Discounted cash flow model Similar open market lending rate 4.4%
Held-for-trading financial liabilities
- ZAR Forward foreign exchange
458,882 Discounted cash flow model ZAR-USD forward foreign exchange 15.0022 to 15.2013
contract
4 Valuation techniques and the qualitative and quantitative information of important parameters for continuous
and non-continuous fair value measurement items at level 3
√Applicable □Not applicable
The significant and unobservable input value of fair value measurement at Level 3 is as follows:
2020 Unobservable input value
Valuation technique
Fair value Name Weighted average
Held-for-trading financial assets –
8,438,278 Discounted cash flow model Weighted average capital cost 11%
equity instrument investments
Investment in other equity Market comparable Liquidity discount 29%-37%
61,505,751
instruments company model P/B ratio of comparable company 1.3-2.18
Market comparable Liquidity discount 29%
Other non-current financial assets 330,094,057
company model P/B ratio of comparable company 1.43
5 For continuous fair value measurement items at level 3, the adjustment information between beginning and
ending book value and the sensitivity analysis of unobservable parameters
□Applicable √Not applicable
6 For continuous fair value measurement items, if there is conversion between different levels in the current
period, the reasons for conversion and the policies for determining the conversion time
□Applicable √Not applicable
169
7 Changes in valuation technology in the current period and reasons for changes
□Applicable √Not applicable
8 Fair values of financial assets and financial liabilities not measured at fair value
□Applicable √Not applicable
9 Others
√Applicable □Not applicable
Assets and liabilities disclosed at fair value
The management has evaluated the monetary funds, accounts receivables, notes payable and accounts payable, and
the fair value is equal to the book value due to short remaining term.
The long-term receivables of the Group are the receivables with floating rate, and the difference between the book value
and fair value is small.
As for the long-term borrowings and long-term payables, the book value shall be determined by the future cash flow specified
in the contract after discounting according to the interest rate which has comparable credit rating on the market and provides
almost the same cash flow under the same conditions, and the difference between the book value and such fair value is small.
Adjustment and level conversion of fair value measurement
In this year, there was no transfer of fair value measurement of financial assets and financial liabilities between level 1
and level 2, and there was no transfer into or out of the level 3.
XII Related parties and related party transactions
1 Parent company
√Applicable □Not applicable
Unit: 10,000 Yuan Currency: CNY
Registration Registered Shareholding ratio in Voting ratio in the
Parent company Business nature
place capital the Company (%) Company (%)
China Communications Port project contracting and
Beijing City 585,542 46.229 46.229
Construction Group Co., Ltd. related business
Description of the parent company of the Company
None
The final controlling party of the Company is the China Communications Construction Group Co., Ltd.
Other description:
None
2 Subsidiaries
For details of subsidiaries of the Company, please refer to the notes.
√Applicable □Not applicable
For details of subsidiaries, please refer to Note IX (1).
3 Joint ventures and associates
For details of major joint ventures and associates, please refer to Note IX (2).
□Applicable √Not applicable
Other joint ventures or associates that have related party transactions with the Company in the current period or formed
balance in the previous period are as follows
□Applicable √Not applicable
Other description
□Applicable √Not applicable
4 Other related parties
√Applicable □Not applicable
Name of other related parties Relationship with related party
China Communications Construction Company Ltd. Controlled by the same parent company
China Harbour Engineering Co., Ltd. Controlled by the same parent company
CCCC Finance Company Ltd. Controlled by the same parent company
170
2020
Name of other related parties Relationship with related party
CCCC Second Highway Engineering Co., Ltd. Controlled by the same parent company
CCCC Second Highway Consultants Co., Ltd. Controlled by the same parent company
CCCC Second Harbor Engineering Co., Ltd. Controlled by the same parent company
CCCC Second Harbor Consultants Co., Ltd. Controlled by the same parent company
CCCC Third Highway Engineering Co. Ltd. Controlled by the same parent company
CCCC Third Harbor Engineering Co., Ltd. Controlled by the same parent company
CCCC Third Harbor Consultants Co., Ltd. Controlled by the same parent company
CCCC Fourth Highway Engineering Co., Ltd. Controlled by the same parent company
CCCC Fourth Harbor Engineering Co., Ltd Controlled by the same parent company
CCCC Fourth Harbor Consultants Co., Ltd. Controlled by the same parent company
CCCC First Highway Engineering Co., Ltd. Controlled by the same parent company
CCCC First Highway Consultants Co., Ltd. Controlled by the same parent company
CCCC First Harbor Engineering Co., Ltd. Controlled by the same parent company
CCCC-FHEC Urban Traffic Engineering Co., Ltd. Controlled by the same parent company
CCCC First Harbor Consultants Co., Ltd. Controlled by the same parent company
CCCC - SHEC Second Highway Engineering Co., Ltd. Controlled by the same parent company
CCCC - SHEC Third Highway Engineering Co., Ltd. Controlled by the same parent company
CCCC - SHEC Fourth Highway Engineering Co., Ltd. Controlled by the same parent company
CCCC - SHEC Railway Construction Co., Ltd Controlled by the same parent company
CCCC - SHEC Electrical Engineering Co., Ltd. Controlled by the same parent company
CCCC SHEC Chengdu Urban Construction Engineering Co., Ltd. Controlled by the same parent company
No.2 Engineering Co., Ltd. of CCCC Second Harbor Engineering Co., Ltd. Controlled by the same parent company
No.3 Co. of The Second Navigational Engineering Bureau, CCCC Controlled by the same parent company
No.4 Engineering Co., Ltd. of CCCC Second Harbor Engineering Co., Ltd. Controlled by the same parent company
The First Construction Company of CCCC Second Harbor Engineering Co., Ltd Controlled by the same parent company
CCCC-SHEC Construction Engineering Co., Ltd Controlled by the same parent company
Zhen Hwa Harbour Construction Co., Ltd. Controlled by the same parent company
Beijing Rate Electronic Technology Developing Co., Ltd. Controlled by the same parent company
CCCC Guidu Highway Construction Co., Ltd. Controlled by the same parent company
Road & Bridge International Co., Ltd. Controlled by the same parent company
Shanghai Waterway Logistics Co., Ltd Controlled by the same parent company
Shanghai Jiangtian Industrial Co., Ltd. Controlled by the same parent company
Shanghai Communications Construction Contracting Co., Ltd. Controlled by the same parent company
Shanghai Interlink Road & Bridge Engineering Co., Ltd. Controlled by the same parent company
Shanghai Zhensha Longfu Machinery Co., Ltd. Controlled by the same parent company
Shanghai China Communications Water Transportation Design & Research Co., Ltd. Controlled by the same parent company
CCCC Tianjin Dredging Co., Ltd. Controlled by the same parent company
Wuhan Hangke Logistics Company Limited Controlled by the same parent company
Hong Kong Marine Construction Limited Controlled by the same parent company
Zhenhua Engineering Co., Ltd. Controlled by the same parent company
Xiangtan CCCC Infrastructure Investment and Construction Co., Ltd. Controlled by the same parent company
Yueyang Chenglingji New Port Co., Ltd. Controlled by the same parent company
China Communications Materials & Equipment Co., Ltd. Controlled by the same parent company
China Road & Bridge Corporation Controlled by the same parent company
China Highway Engineering Consultants Corporation Controlled by the same parent company
Chuwa Risheng (Beijing) International Trade Co., Ltd Controlled by the same parent company
Chuwa Bussan Co., Ltd. Controlled by the same parent company
CCCC (Xiamen) Information Co., Ltd Controlled by the same parent company
171
Name of other related parties Relationship with related party
CCCC (Zhoushan) Dredging Co., Ltd. Controlled by the same parent company
CCCC North Industrial Co., Ltd. Controlled by the same parent company
CCCC Highway Consultants Co., Ltd. Controlled by the same parent company
CCCC Highway Bridges National Engineering Research Centre Co., Ltd. Controlled by the same parent company
CCCC Guangzhou Dredging Co., Ltd. Controlled by the same parent company
CCCC International (Hong Kong) Holdings Limited Controlled by the same parent company
CCCC International Shipping Co., Ltd Controlled by the same parent company
CCCC Marine Engineering & Technology Research Center Co., Ltd. Controlled by the same parent company
CCCC East China Investment Co., Ltd. Controlled by the same parent company
CCCC Electrical and Mechanical Engineering Co., Ltd. Controlled by the same parent company
CCCC Infrastructure Maintenance Group Co., Ltd. Controlled by the same parent company
Road & Bridge East China Engineering Co., Ltd. Controlled by the same parent company
Road & Bridge South China Engineering Co., Ltd Controlled by the same parent company
Road & Bridge International Co., Ltd. Controlled by the same parent company
CCCC Nanjing Traffic Engineering Management Co., Ltd. Controlled by the same parent company
CCCC Financial Leasing (Guangzhou) Co., Ltd Controlled by the same parent company
CCCC Financial Leasing Co., Ltd Controlled by the same parent company
No.2 Engineering Co., Ltd. of CCCC Third Harbor Engineering Co., Ltd. Controlled by the same parent company
No.3 Engineering Co., Ltd. of CCCC Third Harbor Engineering Co., Ltd. Controlled by the same parent company
Construction Materials Co., Ltd, CCCC Third Harbor Engineering Co., Ltd. Controlled by the same parent company
Xing An Ji Engineering Co., Ltd. of CCCC Third Harbor Engineering Co., Ltd. Controlled by the same parent company
CCCC Shanghai Harbor Engineering Design & Research Institute Co., Ltd. Controlled by the same parent company
CCCC Shanghai Dredging Co., Ltd. Controlled by the same parent company
CCCC Shanghai Channel Equipment Industry Co., Ltd. Controlled by the same parent company
CCCC Shanghai Equipment Engineering Co., Ltd. Controlled by the same parent company
CCCC Worldcom (Chongqing) Heavy Industries Co., Ltd. Controlled by the same parent company
CCCC National Engineering Research Center of Dredging Technology and Equipment Co.,
Controlled by the same parent company
Ltd.
CCCC Water Transportation Planning and Design Institute Co., Ltd. Controlled by the same parent company
No. 2 Engineering Co., Ltd. of CCCC Fourth Highway Engineering Co., Ltd. Controlled by the same parent company
No.2 Engineering Co., Ltd. of CCCC Fourth Harbor Engineering Co., Ltd. Controlled by the same parent company
The Third Engineering Company of CCCC Fourth Harbor Engineering Co., Ltd Controlled by the same parent company
CCCC Tunnel Engineering Company Limited Controlled by the same parent company
Hainan Industry Co., Ltd. of CCCC Tianjin Dredging Co., Ltd. Controlled by the same parent company
Binhai Environmental Protection Dredging Co., Ltd. of CCCC Tianjin Dredging Co., Ltd. Controlled by the same parent company
CCCC Tianhe Mechanical Equipment Manufacturing Co., Ltd Controlled by the same parent company
CCCC Tianhe Xi’an Equipment Manufacturing Co., Ltd. Controlled by the same parent company
CCCC Tianjin Port Waterway Prospection & Design Research Institute Co., Ltd. Controlled by the same parent company
CCCC Tianjin Industry and Trade Co., Ltd. Controlled by the same parent company
CCCC Tianjin Dredging Co., Ltd. Controlled by the same parent company
CCCC WuHan Harbour Engineering Design and Research Co., Ltd. Controlled by the same parent company
CCCC Xi’an Road Construction Machinery Co., Ltd. Controlled by the same parent company
CCCC Xingyu Technology Co., Ltd Controlled by the same parent company
CCCC Xiongan Financial Leasing Co., Ltd Controlled by the same parent company
CCCC Yancheng Construction Development Co., Ltd. Controlled by the same parent company
No.8 Engineering Co., Ltd. of CCCC First Highway Engineering Co., Ltd. Controlled by the same parent company
No. 6 Engineering Co., Ltd. of CCCC First Highway Engineering Co., Ltd. Controlled by the same parent company
No. Three Engineering Co., Ltd. of CCCC First Highway Engineering Co., Ltd. Controlled by the same parent company
172
2020
Name of other related parties Relationship with related party
CCCC First Highway Fifth Engineering Co., Ltd. Controlled by the same parent company
CCCC First Highway Electrification Engineering Co., Ltd Controlled by the same parent company
Haiwei Engineering Construction Co., Ltd., of FHEC of CCCC Controlled by the same parent company
Chongqing Yongjiang Expressway Investment and Construction Co., Ltd of FHEC of
Controlled by the same parent company
CCCC
Installation Engineering Co., Ltd. of CCCC First Harbor Engineering Co. Ltd. Controlled by the same parent company
No.2 Engineering Co., Ltd. of CCCC First Harbor Engineering Co., Ltd. Controlled by the same parent company
No.1 Engineering Co., Ltd. of CCCC First Harbor Engineering Co., Ltd. Controlled by the same parent company
CCCC Leasing Jiahua No.2 Co. Ltd. Controlled by the same parent company
CCCC Leasing Jiahua No.1 Co., Ltd. Controlled by the same parent company
CNPC & CCCC Petroleum Sales Co., Ltd. Controlled by the same parent company
Hainan CCCC Fourth Harbor Construction Co., Ltd. Controlled by the same parent company
Electrification Co., Ltd. of CCCC Tunnel Engineering Company Limited Controlled by the same parent company
CTTIC Shanghai Co., Ltd. Controlled by the same parent company
Friede & Goldman, Llc. Controlled by the same parent company
Other description
None
5 Related party transactions
(1) Purchase and sales of goods, and rendering and receipt of labor services
Purchase of goods/receipt of labor services
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in Amount incurred in
Related party Content of transaction
the current period the previous period
No.2 Engineering Co., Ltd. of CCCC Third Harbor Engineering
Receipt of labor services 691,422,066 1,559,123,096
Co., Ltd.
CCCC Fourth Highway Engineering Co., Ltd. Receipt of labor services 306,195,275 326,099,884
CCCC Second Harbor Engineering Co., Ltd. Receipt of labor services 301,152,978 44,626,778
CCCC Third Harbor Engineering Co., Ltd. Receipt of labor services 204,828,721 138,044,572
CCCC First Highway Engineering Co., Ltd. Receipt of labor services 201,690,439 -
CCCC Tianjin Dredging Co., Ltd. Receipt of labor services 100,525,545 30,385,226
CCCC Third Highway Engineering Co. Ltd. Receipt of labor services 60,479,325 102,954,724
ZPMC Southeast Asia Pte. Ltd Receipt of labor services 59,340,652 31,842,242
Shanghai Communications Construction Contracting Co., Ltd. Receipt of labor services 36,281,828 3,843,677
No. 2 Engineering Co., Ltd. of CCCC Fourth Highway
Receipt of labor services 32,430,368 -
Engineering Co., Ltd.
CCCC Water Transportation Planning and Design Institute
Receipt of labor services 26,070,990 44,003,688
Co., Ltd.
Road & Bridge East China Engineering Co., Ltd. Receipt of labor services 23,620,159 -
CCCC Second Highway Engineering Co., Ltd. Receipt of labor services 21,674,421 -
CCCC First Highway Fifth Engineering Co., Ltd. Receipt of labor services 17,768,785 -
CCCC Worldcom (Chongqing) Heavy Industries Co., Ltd. Receipt of labor services 14,309,194 -
China Road & Bridge Corporation Receipt of labor services 10,988,748 9,772,546
CCCC Second Highway Consultants Co., Ltd. Receipt of labor services 5,420,288 12,744,480
China Communications Construction Company Ltd. Receipt of labor services 4,388,549 6,970,318
ZPMC Mediterranean Liman Makinalari Ticaret Anonim Sirketi Receipt of labor services 3,690,480 9,022,814
CCCC Third Harbor Consultants Co., Ltd. Receipt of labor services 3,577,982 400,000
CCCC Tianhe Mechanical Equipment Manufacturing Co., Ltd Receipt of labor services 1,834,862 -
173
Amount incurred in Amount incurred in
Related party Content of transaction
the current period the previous period
Shanghai China Communications Water Transportation
Receipt of labor services 1,748,853 1,008,394
Design & Research Co., Ltd.
CCCC First Harbor Consultants Co., Ltd. Receipt of labor services 1,293,585 128,440
CCCC Xingyu Technology Co., Ltd Receipt of labor services 1,291,516 -
Shanghai Waterway Logistics Co., Ltd Receipt of labor services 1,009,174
Installation Engineering Co., Ltd. of CCCC First Harbor
Receipt of labor services 908,257 7,202,999
Engineering Co. Ltd.
CCCC Highway Consultants Co., Ltd. Receipt of labor services 258,180 -
CCCC Marine Engineering & Technology Research Center
Receipt of labor services 207,203 1,599,377
Co., Ltd.
CCCC WuHan Harbour Engineering Design and Research
Receipt of labor services 68,807 -
Co., Ltd.
CCCC Shanghai Harbor Engineering Design & Research
Receipt of labor services 55,046 -
Institute Co., Ltd.
No.2 Engineering Co., Ltd. of CCCC Fourth Harbor
Receipt of labor services - 166,442,076
Engineering Co., Ltd.
Xing An Ji Engineering Co., Ltd. of CCCC Third Harbor
Receipt of labor services - 126,919,874
Engineering Co., Ltd.
No.3 Co. of The Second Navigational Engineering Bureau,
Receipt of labor services - 37,974,356
CCCC
CCCC - SHEC Second Highway Engineering Co., Ltd. Receipt of labor services - 32,728,018
CCCC Shanghai Dredging Co., Ltd. Receipt of labor services - 27,320,344
China Communications Materials & Equipment Co., Ltd. Receipt of labor services - 17,482,045
CCCC Shanghai Equipment Engineering Co., Ltd. Receipt of labor services - 4,533,910
CCCC Highway Bridges National Engineering Research
Receipt of labor services - 2,449,541
Centre Co., Ltd.
CCCC First Highway Consultants Co., Ltd. Receipt of labor services - 1,153,073
CCCC (Zhoushan) Dredging Co., Ltd. Receipt of labor services - 350,748
No. Three Engineering Co., Ltd. of CCCC First Highway
Receipt of labor services - 343,394
Engineering Co., Ltd.
CCCC Fourth Harbor Engineering Co., Ltd Receipt of labor services - 86,849
CCCC Shanghai Equipment Engineering Co., Ltd. Purchase of goods 645,334,160 51,424,063
ZPMC Changzhou Coatings Co., Ltd. Purchase of goods 83,224,897 145,138,516
CCCC Tianjin Industry and Trade Co., Ltd. Purchase of goods 66,687,672 1,669,824
Installation Engineering Co., Ltd. of CCCC First Harbor
Purchase of goods 61,964,860 -
Engineering Co. Ltd.
Shanghai Jiangtian Industrial Co., Ltd. Purchase of goods 10,044,735 9,429,667
Chongqing Yongjiang Expressway Investment and
Purchase of goods 9,557,213 -
Construction Co., Ltd of FHEC of CCCC
CCCC Shanghai Channel Equipment Industry Co., Ltd. Purchase of goods 3,466,483 320,806
China Communications Construction Company Ltd. Purchase of goods 2,254,606 -
CCCC National Engineering Research Center of Dredging
Purchase of goods 2,151,725 -
Technology and Equipment Co., Ltd.
CNPC & CCCC Petroleum Sales Co., Ltd. Purchase of goods 2,047,752 1,475,121
CCCC (Xiamen) Information Co., Ltd Purchase of goods 20,971 -
Chuwa Bussan Co., Ltd. Purchase of goods - 36,202,211
CCCC Tianjin Port Waterway Prospection & Design Research
Purchase of goods - 9,951,061
Institute Co., Ltd.
CCCC Tianjin Dredging Co., Ltd. Purchase of goods - 5,475,264
174
2020
Amount incurred in Amount incurred in
Related party Content of transaction
the current period the previous period
CCCC North Industrial Co., Ltd. Purchase of goods - 3,841,523
CCCC Marine Engineering & Technology Research Center
Purchase of goods - 2,451,616
Co., Ltd.
China Communications Materials & Equipment Co., Ltd. Purchase of goods - 380,531
CCCC Third Harbor Consultants Co., Ltd. Purchase of goods - 353,982
China Road & Bridge Corporation Purchase of goods - 64,214
Sales of goods/rendering of labor services
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in Amount incurred in
Related party Content of transaction
the current period the previous period
China Road & Bridge Corporation Sales of goods/other inflows 897,728,442 1,678,140,641
CCCC Third Harbor Engineering Co., Ltd. Sales of goods/other inflows 424,401,835 113,127,045
CCCC Second Harbor Engineering Co., Ltd. Sales of goods/other inflows 283,456,305 337,523,772
Jiangsu Longyuan Zhenhua Marine Engineering Co., Ltd Sales of goods/other inflows 231,829,678 248,918,845
Road & Bridge International Co., Ltd. Sales of goods/other inflows 229,793,506 95,683,938
CCCC Third Highway Engineering Co. Ltd. Sales of goods/other inflows 173,821,696 30,678,385
CCCC Second Highway Engineering Co., Ltd. Sales of goods/other inflows 138,705,156 230,557,910
CCCC Electrical and Mechanical Engineering Co., Ltd. Sales of goods/other inflows 88,938,053 124,928,355
China Communications Construction Company Ltd. Sales of goods/other inflows 78,205,835 231,935,329
CCCC First Harbor Consultants Co., Ltd. Sales of goods/other inflows 69,444,739 -
CCCC Tianjin Industry and Trade Co., Ltd. Sales of goods/other inflows 50,952,323 -
ZPMC-OTL MARINE CONTRACTOR LIMITED Sales of goods/other inflows 38,016,390 -
ZPMC Southeast Asia Pte. Ltd Sales of goods/other inflows 37,632,123 -
The First Construction Company of CCCC Second Harbor
Sales of goods/other inflows 36,724,138 -
Engineering Co., Ltd
CCCC - SHEC Third Highway Engineering Co., Ltd. Sales of goods/other inflows 34,008,547 26,395,514
Installation Engineering Co., Ltd. of CCCC First Harbor
Sales of goods/other inflows 22,123,894 28,657,101
Engineering Co. Ltd.
CCCC First Harbor Engineering Co., Ltd. Sales of goods/other inflows 20,139,620 6,829,633
CCCC First Highway Engineering Co., Ltd. Sales of goods/other inflows 14,921,008 126,158,585
China Harbour Engineering Co., Ltd. Sales of goods/other inflows 13,927,295 45,102,497
CCCC Tunnel Engineering Company Limited Sales of goods/other inflows 12,218,362 6,135,411
CCCC Yancheng Construction Development Co., Ltd. Sales of goods/other inflows 11,855,952 -
CCCC Shanghai Equipment Engineering Co., Ltd. Sales of goods/other inflows 8,761,075 -
The Third Engineering Company of CCCC Fourth Harbor
Sales of goods/other inflows 6,559,140 -
Engineering Co., Ltd
CCCC First Highway Electrification Engineering Co., Ltd Sales of goods/other inflows 6,129,210 -
No.3 Co. of The Second Navigational Engineering Bureau,
Sales of goods/other inflows 5,053,060 3,750,000
CCCC
CCCC - SHEC Electrical Engineering Co., Ltd. Sales of goods/other inflows 4,731,690 -
CCCC Tianhe Mechanical Equipment Manufacturing Co., Ltd Sales of goods/other inflows 4,698,839 -
Beijing Rate Electronic Technology Developing Co., Ltd. Sales of goods/other inflows 3,550,889 -
CCCC Xi’an Road Construction Machinery Co., Ltd. Sales of goods/other inflows 1,327,434 -
CCCC International Shipping Co., Ltd Sales of goods/other inflows 1,044,785 -
Road & Bridge International Co., Ltd. Sales of goods/other inflows 78,509 -
CCCC Financial Leasing Co., Ltd Sales of goods/other inflows - 667,073,687
CCCC Tianjin Dredging Co., Ltd. Sales of goods/other inflows - 26,539,740
CCCC Marine Engineering & Technology Research Center Co., Ltd. Sales of goods/other inflows - 8,345,339
175
Amount incurred in Amount incurred in
Related party Content of transaction
the current period the previous period
Hong Kong Marine Construction Limited Sales of goods/other inflows - 7,992,047
CCCC Fourth Highway Engineering Co., Ltd. Sales of goods/other inflows - 7,874,250
No.3 Engineering Co., Ltd. of CCCC Third Harbor
Sales of goods/other inflows - 7,230,066
Engineering Co., Ltd.
No.4 Engineering Co., Ltd. of CCCC Second Harbor
Sales of goods/other inflows - 6,037,290
Engineering Co., Ltd.
Shanghai Communications Construction Contracting Co., Ltd. Sales of goods/other inflows - 12,236
Total 2,950,779,528 4,065,627,616
Description of related party transactions of purchase and sales of goods, rendering and receipt of labor services
□Applicable √Not applicable
(2) Trusteeship/contracting and entrustment/outsourcing
Trusteeship/contracting of the Company:
□Applicable √Not applicable
Description of the trusteeship/contracting with related parties
□Applicable √Not applicable
Entrustment/outsourcing of the Company
□Applicable √Not applicable
Management/outsourcing with related parties
□Applicable √Not applicable
(3) Leases with related parties
The Company as the lessor
□Applicable √Not applicable
The Company as the lessee:
□Applicable √Not applicable
Description of leases with related parties
□Applicable √Not applicable
(4) Guarantees with related parties
The company as the guarantor
□Applicable √Not applicable
The company as the guaranteed party
□Applicable √Not applicable
Description of the guarantees with related parties
□Applicable √Not applicable
(5) Lendings with related parties
□Applicable √Not applicable
(6) Assets transfer and debt restructuring of related parties
□Applicable √Not applicable
(7) Remuneration of key management personnel
√Applicable □Not applicable
Unit: 10,000 Yuan Currency: CNY
Item Amount incurred in the current period Amount incurred in the previous period
Remuneration of key management personnel 1,206 1,161
(8) Other related party transactions
√Applicable □Not applicable
1) Paying dividends to related parties
2020 2019
CCCC International (Hong Kong) Holdings Limited 45,837,792 -
China Communications Construction Company Ltd. 42,777,102 42,777,102
CCCG 33,161,169 33,161,169
CCCC Second Harbor Engineering Co., Ltd. 9,682,385 -
CCCC Highway Consultants Co., Ltd. 2,420,596 -
CCCC East China Investment Co., Ltd. 2,420,596 -
176
2020
2020 2019
Zhenhua Engineering Co., Ltd. - 44,921,036
Zhen Hwa Harbour Construction Co., Ltd. - 916,756
136,299,640 121,776,063
2) Deposits in (withdrawal of deposits from) related parties
2020 2019
CCCC Finance Company Ltd. (360,641,890) 433,312,793
China Communications Construction Company Ltd. - (3,733,158)
(360,641,890) 429,579,635
3) Borrowings from related parties
2020 2019
CCCC Finance Company Ltd. 2,500,000,000 50,000,000
CCCC Financial Leasing Co., Ltd 413,000,000 413,361,212
CCCC Leasing Jiahua No.1 Co., Ltd. 338,980,000 -
CCCC Xiongan Financial Leasing Co., Ltd 70,000,000 -
CCCC Financial Leasing (Guangzhou) Co., Ltd 51,000,000 -
3,372,980,000 463,361,212
4) Interest collected from related parties
2020 2019
CCCC Finance Company Ltd. 297,806 465,261
China Communications Construction Company Ltd. - 2,101,285
297,806 2,566,546
5) Interest paid to related parties
2020 2019
CCCC Finance Company Ltd. 13,871,667 18,245,229
CCCC Financial Leasing Co., Ltd 13,795,110 26,460,645
CCCC Leasing Jiahua No.1 Co., Ltd. 8,537,825 46,946,944
CCCC Leasing Jiahua No.2 Co. Ltd. 8,537,825 14,691,723
CCCC Xiongan Financial Leasing Co., Ltd 834,444 -
CCCC Financial Leasing (Guangzhou) Co., Ltd 482,639 -
46,059,510 106,344,541
6 Accounts receivable and payable by related parties
(1) Receivables
√Applicable □Not applicable
Unit: Yuan Currency: CNY
December 31, 2020 December 31, 2019
Item Related parties Book Provision for Book Provision for
balance bad debt balance bad debt
Accounts receivable CCCC Third Harbor Engineering Co., Ltd. 175,013,189 - 48,017,218 -
Jiangsu Longyuan Zhenhua Marine Engineering
Accounts receivable 162,823,292 - 204,812,244 -
Co., Ltd
Accounts receivable CCCC First Harbor Engineering Co., Ltd. 121,988,778 - 130,700,172 -
Accounts receivable CCCC Second Harbor Engineering Co., Ltd. 110,819,885 - 112,525,256 -
177
December 31, 2020 December 31, 2019
Item Related parties Book Provision for Book Provision for
balance bad debt balance bad debt
No.1 Engineering Co., Ltd. of CCCC First Harbor
Accounts receivable 59,832,510 - 59,832,510 -
Engineering Co., Ltd.
Accounts receivable CCCC Second Highway Engineering Co., Ltd. 56,896,049 - 104,419,393 -
Accounts receivable China Communications Construction Company Ltd. 41,920,389 - 44,091,360 -
Accounts receivable CCCC Electrical and Mechanical Engineering Co., Ltd. 29,971,240 - -
Accounts receivable CCCC - SHEC Fourth Highway Engineering Co., Ltd. 29,418,356 - -
Accounts receivable CCCC First Harbor Consultants Co., Ltd. 28,927,082 - 13,290,419 -
Accounts receivable China Harbour Engineering Co., Ltd. 24,508,151 - 7,338,237 -
Accounts receivable ZPMC-OTL MARINE CONTRACTOR LIMITED 23,195,911 - 33,140,688 -
Accounts receivable Road & Bridge International Co., Ltd. 21,011,580 55,526,242 -
The First Construction Company of CCCC Second
Accounts receivable 17,956,828 - 21,712,500 -
Harbor Engineering Co., Ltd
Accounts receivable CCCC Tianjin Industry and Trade Co., Ltd. 17,469,938 - 5,058,290 -
ZPMC Mediterranean Liman Makinalari Ticaret
Accounts receivable 15,791,610 - 19,559,532 -
Anonim Sirketi
Accounts receivable ZPMC Southeast Asia Pte. Ltd 15,550,746 - 3,097,777 -
Accounts receivable Friede & Goldman, Llc. 15,517,772 - 17,890,465 -
Xiangtan CCCC Infrastructure Investment and
Accounts receivable 15,052,800 - 15,052,800 -
Construction Co., Ltd.
Accounts receivable CCCC Third Harbor Consultants Co., Ltd. 13,766,470 - 150,000 -
Binhai Environmental Protection Dredging Co., Ltd.
Accounts receivable 13,550,085 - -
of CCCC Tianjin Dredging Co., Ltd.
Accounts receivable Zhenhua Marine Energy (HK) Co., Ltd. 11,235,878 - 12,013,016 -
Accounts receivable CCCC Fourth Harbor Engineering Co., Ltd 10,500,000 - 12,750,000 -
Accounts receivable Chuwa Risheng (Beijing) International Trade Co., Ltd 10,498,227 - -
Accounts receivable CCCC International Shipping Co., Ltd 10,116,795 - -
Accounts receivable CCCC Fourth Harbor Consultants Co., Ltd. 7,398,000 - 14,796,000 -
No. 6 Engineering Co., Ltd. of CCCC First Highway
Accounts receivable 6,098,300 - 6,098,300 -
Engineering Co., Ltd.
Accounts receivable Road & Bridge International Co., Ltd. 4,343,950 - 6,953,532 -
Accounts receivable CCCC - SHEC Second Highway Engineering Co., Ltd. 3,225,975 - 8,125,713 -
Accounts receivable Shanghai Interlink Road&Bridge Engineering Co., Ltd. 1,900,000 - - -
CCCC Tianhe Mechanical Equipment
Accounts receivable 1,798,872 - -
Manufacturing Co., Ltd
CCCC First Highway Electrification Engineering
Accounts receivable 1,714,091 - - -
Co., Ltd
Accounts receivable CCCC - SHEC Third Highway Engineering Co., Ltd. 1,015,313 - 1,015,313 -
Accounts receivable CCCC - SHEC Railway Construction Co., Ltd 727,743 - - -
No.2 Engineering Co., Ltd. of CCCC Second
Accounts receivable 499,367 - 6,199,367 -
Harbor Engineering Co., Ltd.
Installation Engineering Co., Ltd. of CCCC First
Accounts receivable 386,912 - 1,311,259 -
Harbor Engineering Co. Ltd.
Accounts receivable CCCC Xi’an Road Construction Machinery Co., Ltd. 350,000 - - -
Accounts receivable Shanghai Jiangtian Industrial Co., Ltd. 340,862 - - -
Accounts receivable Beijing Rate Electronic Technology Developing Co., Ltd. 303,954 - - -
Accounts receivable CCCC Shanghai Dredging Co., Ltd. 286,500 - - -
Accounts receivable Road & Bridge South China Engineering Co., Ltd 232,040 - 13,178,839 -
Accounts receivable CCCC Third Highway Engineering Co. Ltd. 156,370 - 11,363,591 -
178
2020
December 31, 2020 December 31, 2019
Item Related parties Book Provision for Book Provision for
balance bad debt balance bad debt
No.3 Co. of The Second Navigational Engineering
Accounts receivable 142,296 - 23,938,106 -
Bureau, CCCC
Accounts receivable CCCC Financial Leasing Co., Ltd 117,643 - 226,485,073 -
Hainan Industry Co., Ltd. of CCCC Tianjin Dredging
Accounts receivable 107,834 - 2,156,675 -
Co., Ltd.
Accounts receivable CCCC Guangzhou Dredging Co., Ltd. 69,200 - 69,200 -
Accounts receivable CCCC Guidu Highway Construction Co., Ltd. 63,951 - 79,332 -
Accounts receivable Yueyang Chenglingji New Port Co., Ltd. 53,121 - 48,680 -
Accounts receivable CCCC Tunnel Engineering Company Limited - - 92,085,891 -
Accounts receivable CCCC First Highway Engineering Co., Ltd. - - 43,230,857 -
Accounts receivable China Road & Bridge Corporation - - 18,076,000 -
CCCC Marine Engineering & Technology Research
Accounts receivable - - 12,822,927 -
Center Co., Ltd.
Accounts receivable Hainan CCCC Fourth Harbor Construction Co., Ltd. - - 6,200,000 -
Accounts receivable CCCC Shanghai Equipment Engineering Co., Ltd. - - 6,000,000 -
Accounts receivable CCCC-FHEC Urban Traffic Engineering Co., Ltd. - - 4,303,584 -
Accounts receivable CCCC Fourth Highway Engineering Co., Ltd. - - 4,000,000 -
No. Three Engineering Co., Ltd. of CCCC First
Accounts receivable - - 1,126,432 -
Highway Engineering Co., Ltd.
Accounts receivable CCCC - SHEC Electrical Engineering Co., Ltd. - - 770,321 -
Xing An Ji Engineering Co., Ltd. of CCCC Third
Accounts receivable - - 331,860 -
Harbor Engineering Co., Ltd.
Electrification Co., Ltd. of CCCC Tunnel
Accounts receivable - - 172,787 -
Engineering Company Limited
No.2 Engineering Co., Ltd. of CCCC First Harbor
Accounts receivable - - 130,500 -
Engineering Co., Ltd.
Receivables
Road & Bridge International Co., Ltd. 21,000,000 - - -
financing
Receivables No.4 Engineering Co., Ltd. of CCCC Second
10,000,000 - - -
financing Harbor Engineering Co., Ltd.
Receivables
CCCC Second Highway Engineering Co., Ltd. 8,000,000 - - -
financing
Receivables CCCC - SHEC Second Highway Engineering Co.,
8,000,000 - - -
financing Ltd.
Receivables CCCC Tianhe Mechanical Equipment
2,482,170 - - -
financing Manufacturing Co., Ltd
Receivables
CCCC Third Highway Engineering Co. Ltd. 1,789,772 - -
financing
Receivables
CCCC Third Harbor Engineering Co., Ltd. 1,000,000 - - -
financing
Receivables
CCCC First Harbor Engineering Co., Ltd. 500,000 - 4,000,000 -
financing
Receivables
Road & Bridge East China Engineering Co., Ltd. - - 46,389,055 -
financing
Receivables
CCCC Second Harbor Engineering Co., Ltd. - - 15,998,000 -
financing
Receivables
CCCC Fourth Harbor Engineering Co., Ltd - - 8,045,547 -
financing
Receivables CCCC Electrical and Mechanical Engineering Co.,
- - 2,000,000 -
financing Ltd.
179
December 31, 2020 December 31, 2019
Item Related parties Book Provision for Book Provision for
balance bad debt balance bad debt
Other receivables Zhenhua Marine Energy (HK) Co., Ltd. 164,124,678 164,124,678 164,124,678 164,124,678
Other receivables ZPMC Southeast Asia Pte. Ltd 13,890,516 - 13,890,516 -
Other receivables CCCC Yancheng Construction Development Co., Ltd. 1,801,634 - 3,357,729 -
Other receivables China Communications Construction Company Ltd. 518,781 - 47,845,576 -
Other receivables China Road & Bridge Corporation 215,492 - - -
Other receivables Shanghai Jiangtian Industrial Co., Ltd. 77,552 - 77,552 -
Haiwei Engineering Construction Co., Ltd., of
Other receivables 500 - - -
FHEC of CCCC
Other receivables CCCC Financial Leasing Co., Ltd - - 20,000,000 -
Other receivables CCCC Third Harbor Engineering Co., Ltd. - - 11,312,360 -
Other receivables CCCC East China Investment Co., Ltd. - - 9,129,287 -
Other receivables CCCC First Highway Fifth Engineering Co., Ltd. - - 8,897,903 -
Other receivables CCCC Highway Consultants Co., Ltd. - - 4,629,287 -
No.3 Engineering Co., Ltd. of CCCC Third Harbor
Other receivables - - 3,975,000 -
Engineering Co., Ltd.
Other receivables CCCC Tianhe Xi’an Equipment Manufacturing Co., Ltd. - - 3,199,744 -
Other receivables CCCC Second Highway Consultants Co., Ltd. - - 3,180,000 -
Other receivables CCCC Third Highway Engineering Co. Ltd. - - 3,132,473 -
CCCC Marine Engineering & Technology Research
Other receivables - - 1,100,000 -
Center Co., Ltd.
Installation Engineering Co., Ltd. of CCCC First
Other receivables - - 600,000 -
Harbor Engineering Co. Ltd.
Other receivables CCCC Second Highway Engineering Co., Ltd. - - 200,000 -
Other receivables CCCC Tunnel Engineering Company Limited - - 60,000 -
Other receivables Shanghai Zhensha Longfu Machinery Co., Ltd. - - 21,503 -
Other receivables CCCC Second Harbor Engineering Co., Ltd. - - 10,000
Other receivables ZPMC Changzhou Coatings Co., Ltd. - - 4,214
Advances to
Road & Bridge East China Engineering Co., Ltd. 23,200,357 - -
suppliers
Advances to CCCC Shanghai Channel Equipment Industry Co.,
9,347,000 - - -
suppliers Ltd.
Advances to CCCC National Engineering Research Center of
8,264,000 - - -
suppliers Dredging Technology and Equipment Co., Ltd.
Advances to
CCCC Second Harbor Consultants Co., Ltd. 731,601 - - -
suppliers
Advances to CCCC Marine Engineering & Technology Research
717,739 - 767,382 -
suppliers Center Co., Ltd.
Advances to
CCCC-SHEC Construction Engineering Co., Ltd 2,000 - - -
suppliers
Advances to
ZPMC Southeast Asia Pte. Ltd - - 102,910 -
suppliers
Jiangsu Longyuan Zhenhua Marine Engineering
Contract assets 29,068,026 - - -
Co., Ltd
Contract assets CCCC Second Harbor Engineering Co., Ltd. 21,898,621 - - -
Contract assets CCCC Financial Leasing Co., Ltd 14,770,690 - - -
Contract assets CCCC Second Highway Engineering Co., Ltd. 13,468,405 - - -
Contract assets CCCC First Harbor Engineering Co., Ltd. 12,588,620 - - -
Contract assets Road & Bridge International Co., Ltd. 11,001,670 - - -
180
2020
December 31, 2020 December 31, 2019
Item Related parties Book Provision for Book Provision for
balance bad debt balance bad debt
Contract assets CCCC - SHEC Second Highway Engineering Co., Ltd. 10,821,112 - - -
Contract assets CCCC Electrical and Mechanical Engineering Co., Ltd. 10,050,000 - - -
Contract assets CCCC Third Harbor Engineering Co., Ltd. 9,530,062 - - -
Contract assets CCCC First Harbor Consultants Co., Ltd. 3,472,237 - - -
Contract assets Road & Bridge South China Engineering Co., Ltd 3,064,962 - - -
Contract assets CCCC Tianjin Industry and Trade Co., Ltd. 1,528,570 - - -
Contract assets CCCC Third Highway Engineering Co. Ltd. 973,366 - - -
Long-term
CCCC Third Highway Engineering Co. Ltd. - - 797,873 -
receivables
(2) Payables
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Ending book Beginning book
Item Related parties
balance balance
Accounts payable CCCC Second Harbor Engineering Co., Ltd. 195,112,843 27,440,101
Accounts payable CCCC Third Harbor Engineering Co., Ltd. 190,480,435 154,812,290
Accounts payable CCCC Fourth Highway Engineering Co., Ltd. 154,901,564 218,797,193
Accounts payable CCCC First Highway Engineering Co., Ltd. 82,536,113 71,000,831
Accounts payable CCCC Tianjin Dredging Co., Ltd. 42,519,453 78,800,497
Accounts payable CCCC Shanghai Equipment Engineering Co., Ltd. 42,317,791 81,410,402
Accounts payable Shanghai Communications Construction Contracting Co., Ltd. 25,385,550 13,225,998
Accounts payable Installation Engineering Co., Ltd. of CCCC First Harbor Engineering Co. Ltd. 24,122,512 77,599
Accounts payable CCCC Second Highway Consultants Co., Ltd. 24,021,890 25,578,962
Accounts payable No.1 Engineering Co., Ltd. of CCCC First Harbor Engineering Co., Ltd. 23,818,225 23,818,225
Accounts payable CCCC Shanghai Channel Equipment Industry Co., Ltd. 20,550,148 -
Accounts payable CCCC Second Highway Engineering Co., Ltd. 16,875,119 -
Accounts payable ZPMC Southeast Asia Pte. Ltd 16,356,162 7,070,528
Accounts payable Shanghai Jiangtian Industrial Co., Ltd. 16,153,063 13,898,988
Accounts payable CCCC Worldcom (Chongqing) Heavy Industries Co., Ltd. 15,597,022 -
Accounts payable ZPMC Changzhou Coatings Co., Ltd. 12,809,629 15,695,707
CCCC National Engineering Research Center of Dredging Technology and
Accounts payable 12,460,428 5,205,113
Equipment Co., Ltd.
Accounts payable CCCC First Harbor Consultants Co., Ltd. 9,925,376 8,694,176
Accounts payable No.3 Engineering Co., Ltd. of CCCC Third Harbor Engineering Co., Ltd. 7,815,018 7,815,018
Accounts payable CCCC Shanghai Dredging Co., Ltd. 7,571,156 13,133,517
Accounts payable No. 2 Engineering Co., Ltd. of CCCC Fourth Highway Engineering Co., Ltd. 7,089,932 -
Accounts payable CCCC Tianjin Industry and Trade Co., Ltd. 5,449,146 3,589,681
Accounts payable Xing An Ji Engineering Co., Ltd. of CCCC Third Harbor Engineering Co., Ltd. 4,327,352 4,327,352
Accounts payable Jiangsu Longyuan Zhenhua Marine Engineering Co., Ltd 4,318,500 10,136,028
Accounts payable CCCC Marine Engineering & Technology Research Center Co., Ltd. 3,325,742 12,919,599
Accounts payable Friede & Goldman, Llc. 2,582,443 -
Accounts payable CCCC Tianhe Mechanical Equipment Manufacturing Co., Ltd 2,000,000 -
Accounts payable ZPMC Mediterranean Liman Makinalari Ticaret Anonim Sirketi 1,615,788 336,127
Accounts payable CNPC & CCCC Petroleum Sales Co., Ltd. 821,582 391,056
Accounts payable No.2 Engineering Co., Ltd. of CCCC Third Harbor Engineering Co., Ltd. 800,000 1,600,000
181
Ending book Beginning book
Item Related parties
balance balance
Shanghai China Communications Water Transportation Design & Research
Accounts payable 740,000 538,750
Co., Ltd.
Accounts payable CCCC First Harbor Engineering Co., Ltd. 517,150 15,754,549
Chongqing Yongjiang Expressway Investment and Construction Co., Ltd of
Accounts payable 323,990 -
FHEC of CCCC
Accounts payable Zhenhua (Singapore) Engineering Co., Ltd 202,231 -
Accounts payable CCCC Third Highway Engineering Co. Ltd. 176,730 81,247,665
Accounts payable CCCC (Xiamen) Information Co., Ltd 101,136 -
Accounts payable CCCC Third Harbor Consultants Co., Ltd. 100,000 385,980
Accounts payable CCCC WuHan Harbour Engineering Design and Research Co., Ltd. 75,000 700,000
Accounts payable CCCC Shanghai Harbor Engineering Design & Research Institute Co., Ltd. 60,000 -
Accounts payable No.2 Engineering Co., Ltd. of CCCC Fourth Harbor Engineering Co., Ltd. - 125,024,626
Accounts payable CCCC - SHEC Second Highway Engineering Co., Ltd. - 30,900,741
Accounts payable No.3 Co. of The Second Navigational Engineering Bureau, CCCC - 28,660,487
Accounts payable CCCC - SHEC Third Highway Engineering Co., Ltd. - 10,012,230
Accounts payable CCCC Water Transportation Planning and Design Institute Co., Ltd. - 6,547,891
Accounts payable CCCC North Industrial Co., Ltd. - 3,228,777
Accounts payable CCCC Highway Bridges National Engineering Research Centre Co., Ltd. - 2,670,000
Accounts payable CCCC Tunnel Engineering Company Limited - 1,477,308
Accounts payable CCCC First Highway Consultants Co., Ltd. - 574,560
Accounts payable CCCC Electrical and Mechanical Engineering Co., Ltd. - 501,000
Accounts payable Construction Materials Co., Ltd, CCCC Third Harbor Engineering Co., Ltd. - 150,000
Accounts payable China Communications Materials & Equipment Co., Ltd. - 30,000
Accounts payable CTTIC Shanghai Co., Ltd. - 120,000
Notes payable CCCC Shanghai Equipment Engineering Co., Ltd. 41,823,373 42,912,082
Notes payable CCCC Third Harbor Engineering Co., Ltd. 15,918,000 -
Notes payable CCCC Tianjin Industry and Trade Co., Ltd. 13,100,000 66,393,976
Notes payable ZPMC Changzhou Coatings Co., Ltd. 11,800,000 -
Notes payable CCCC Second Highway Engineering Co., Ltd. 6,750,000 -
Notes payable Road & Bridge East China Engineering Co., Ltd. 3,000,000 -
Shanghai China Communications Water Transportation Design & Research
Notes payable 432,500 -
Co., Ltd.
CCCC National Engineering Research Center of Dredging Technology and
Notes payable - 2,322,000
Equipment Co., Ltd.
Notes payable No. Three Engineering Co., Ltd. of CCCC First Highway Engineering Co., Ltd. - 374,300
Notes payable CCCC (Zhoushan) Dredging Co., Ltd. - 246,887
Contract liabilities China Road & Bridge Corporation 741,065,613 -
Contract liabilities CCCC Electrical and Mechanical Engineering Co., Ltd. 257,469,485 -
Contract liabilities Xiangtan CCCC Infrastructure Investment and Construction Co., Ltd. 106,194,690 -
Contract liabilities CCCC First Harbor Engineering Co., Ltd. 52,141,593 -
Contract liabilities CCCC Financial Leasing Co., Ltd 41,277,876 -
Contract liabilities No.1 Engineering Co., Ltd. of CCCC First Harbor Engineering Co., Ltd. 30,995,575 -
Contract liabilities Jiangsu Longyuan Zhenhua Marine Engineering Co., Ltd 16,871,857 -
Contract liabilities CCCC Third Highway Engineering Co. Ltd. 13,387,655 -
Contract liabilities CCCC Second Harbor Engineering Co., Ltd. 10,492,066 -
Contract liabilities CCCC Third Harbor Engineering Co., Ltd. 4,488,752 -
Contract liabilities China Harbour Engineering Co., Ltd. 818,899 -
Contract liabilities ZPMC Southeast Asia Pte. Ltd 489,368 -
182
2020
Ending book Beginning book
Item Related parties
balance balance
Contract liabilities Cranetech Global Sdn. Bhd. 217,932 -
Contract liabilities Xing An Ji Engineering Co., Ltd. of CCCC Third Harbor Engineering Co., Ltd. 200,000 -
Contract liabilities No.2 Engineering Co., Ltd. of CCCC First Harbor Engineering Co., Ltd. 188,679 -
Contract liabilities CCCC Shanghai Equipment Engineering Co., Ltd. 100,000 -
Contract liabilities Friede & Goldman, Llc. 11,830 -
Contract liabilities CCCC Second Highway Engineering Co., Ltd. 3,706 -
Contract liabilities No.2 Engineering Co., Ltd. of CCCC Fourth Harbor Engineering Co., Ltd. 71 -
Advances from
CCCC Tunnel Engineering Company Limited - 124,057,549
customers
Advances from Binhai Environmental Protection Dredging Co., Ltd. of CCCC Tianjin Dredging
- 53,943,315
customers Co., Ltd.
Advances from
No.3 Co. of The Second Navigational Engineering Bureau, CCCC - 13,651,291
customers
Advances from
Wuhan Hangke Logistics Company Limited - 5,801,268
customers
Advances from
CCCC Second Harbor Engineering Co., Ltd. - 4,005,140
customers
Advances from
CCCC First Highway Engineering Co., Ltd. - 4,000,000
customers
Advances from
CCCC Yancheng Construction Development Co., Ltd. - 1,340,000
customers
Advances from
No.8 Engineering Co., Ltd. of CCCC First Highway Engineering Co., Ltd. - 1,200,000
customers
Advances from
CCCC SHEC Chengdu Urban Construction Engineering Co., Ltd. - 942,101
customers
Advances from
Road & Bridge International Co., Ltd. - 832,675
customers
Advances from
ZPMC-OTL MARINE CONTRACTOR LIMITED - 749,244
customers
Advances from
Friede & Goldman, Llc. - 713,623
customers
Advances from
CCCC Third Harbor Engineering Co., Ltd. - 600,000
customers
Advances from
No. Three Engineering Co., Ltd. of CCCC First Highway Engineering Co., Ltd. - 600,000
customers
Advances from
Jiangsu Longyuan Zhenhua Marine Engineering Co., Ltd - 366,574
customers
Advances from
China Harbour Engineering Co., Ltd. - 346,318
customers
Advances from
CranetechGlobalSdn.Bhd. - 233,005
customers
Advances from
CCCC Shanghai Equipment Engineering Co., Ltd. - 100,000
customers
Advances from Transportation Construction Engineering Branch of CCCC Third Harbor
- 56,758
customers Engineering Co., Ltd.
Other payables CCCC Third Harbor Engineering Co., Ltd. 5,365,564 804,250
Other payables CCCC Fourth Highway Engineering Co., Ltd. 5,039,639 -
Other payables CCCC Third Highway Engineering Co. Ltd. 4,924,698 3,006,596
Other payables Shanghai Jiangtian Industrial Co., Ltd. 4,586,085 4,586,085
Other payables CCCC East China Investment Co., Ltd. 4,130,000
Other payables CCCC Tianjin Dredging Co., Ltd. 2,000,000 28,187,053
Other payables CCCG 1,649,724 1,600,544
183
Ending book Beginning book
Item Related parties
balance balance
Other payables No. 2 Engineering Co., Ltd. of CCCC Fourth Highway Engineering Co., Ltd. 1,491,318 -
Other payables CCCC Electrical and Mechanical Engineering Co., Ltd. 665,174 665,174
Other payables Zhenhua Engineering Co., Ltd. 346,005 346,005
Other payables Jiangsu Longyuan Zhenhua Marine Engineering Co., Ltd 335,537 250,329
Other payables CCCC Second Harbor Engineering Co., Ltd. 295,750 1,051,750
Other payables ZPMC Changzhou Coatings Co., Ltd. 107,100 108,592
Other payables CCCC Shanghai Equipment Engineering Co., Ltd. 100,000 89,000
Other payables CCCC Shanghai Harbor Engineering Design & Research Institute Co., Ltd. 30,000 -
Other payables Zhen Hwa Harbour Construction Co., Ltd. 6,593 6,593
Other payables China Communications Construction Company Ltd. 116 101,284,894
Other payables Chuwa Bussan Co., Ltd. - 6,269,873
Other payables CCCC Tunnel Engineering Company Limited - 4,000,000
Other payables China Harbour Engineering Co., Ltd. - 3,625,000
Other payables Road & Bridge East China Engineering Co., Ltd. - 448,442
Other payables CCCC Water Transportation Planning and Design Institute Co., Ltd. - 319,340
Other payables CNPC & CCCC Petroleum Sales Co., Ltd. - 300,000
Other payables Shanghai Zhensha Longfu Machinery Co., Ltd. - 150,124
Other payables No.2 Engineering Co., Ltd. of CCCC Fourth Harbor Engineering Co., Ltd. - 100,000
Other payables CCCC First Harbor Engineering Co., Ltd. - 87,893
Other payables CCCC Infrastructure Maintenance Group Co., Ltd. - 72,477
Other payables CCCC Nanjing Traffic Engineering Management Co., Ltd. - 21,288
Short-term
CCCC Finance Company Ltd. 2,501,498,333 -
borrowings
Short-term
CCCC Financial Leasing Co., Ltd 415,625,023 414,863,968
borrowings
Short-term
CCCC Xiongan Financial Leasing Co., Ltd 70,134,444 -
borrowings
Short-term
CCCC Financial Leasing (Guangzhou) Co., Ltd 51,145,242 -
borrowings
Long-term
CCCC Finance Company Ltd. - 500,483,333
borrowings
Non-current liabilities
CCCC Leasing Jiahua No.1 Co., Ltd. 231,789,305 412,592,400
due within one year
Non-current liabilities
CCCC Financial Leasing Co., Ltd - 203,727,814
due within one year
Non-current liabilities
CCCC Leasing Jiahua No.2 Co. Ltd. 123,040,972 63,782,400
due within one year
Long-term payables CCCC Leasing Jiahua No.1 Co., Ltd. 217,496,667 131,551,200
Long-term payables CCCC Tianjin Dredging Co., Ltd. 139,682,457 139,682,457
Long-term payables CCCC Second Harbor Engineering Co., Ltd. 60,830,418 82,663,041
Long-term payables CCCC Fourth Highway Engineering Co., Ltd. 39,558,526 -
Long-term payables CCCC Third Harbor Engineering Co., Ltd. 32,345,147 16,923,594
Long-term payables No. 2 Engineering Co., Ltd. of CCCC Fourth Highway Engineering Co., Ltd. 9,520,885 -
Long-term payables CCCC - SHEC Third Highway Engineering Co., Ltd. 2,012,230 -
Long-term payables CCCC Tunnel Engineering Company Limited 877,307 -
Long-term payables CCCC - SHEC Second Highway Engineering Co., Ltd. 125,862 -
Long-term payables CCCC Leasing Jiahua No.2 Co. Ltd. - 131,551,201
Long-term payables No.2 Engineering Co., Ltd. of CCCC Fourth Harbor Engineering Co., Ltd. - 7,788,241
184
2020
7 Commitments with related parties
√Applicable □Not applicable
The Group's commitments related to related party contracted for but not provided in the balance sheet as at the balance
sheet date:
Rendering of services for the Group by related parties 2020 2019
CCCC Third Harbor Engineering Co., Ltd. 1,196,441,876 1,274,486,284
CCCC Tianjin Dredging Co., Ltd. 846,472,448 681,997,993
CCCC First Highway Engineering Co., Ltd. 779,111,939 1,386,937,372
CCCC First Highway Fifth Engineering Co., Ltd. 388,366,210 -
No.2 Engineering Co., Ltd. of CCCC Fourth Highway Engineering Co., Ltd. 305,931,400 -
No.1 Engineering Co., Ltd. of CCCC First Harbor Engineering Co., Ltd. 56,568,996 56,568,996
Shanghai Communications Construction Contracting Co., Ltd. 9,650,296 -
CCCC Tunnel Engineering Company Limited 158,070 158,070
CCCC Fourth Highway Engineering Co., Ltd. - 338,361,768
CCCC Shanghai Dredging Co., Ltd. - 45,932,122
3,582,701,235 3,784,442,605
Standby leasing agreement signed with the related parties
On December 16, 2015, the Company signed ship rental standby agreement with CCCC Leasing Jiahua No.1 Co., Ltd
and CCCC Leasing Jiahua No.2 Co., Ltd (collectively referred to as “CCCC Jiahua”), with the rental term from March 5, 2016
to December 5, 2021.The contract would come into effect when the ship rental agreement signed by the subsidiary of the
Company and CCCC Jiahua couldn’t be performed normally. As at December 31, 2020, the maximum payment amount of
the contract was RMB 246,081,944 (as at December 31, 2019: RMB 390,667,201).
Lease assets to related parties 2020 2019
Zhenhua Marine Energy (Hong Kong) Co., Ltd. 575,994,244 891,356,781
2020 2019
China Road & Bridge Corporation 588,402,357 830,028,535
CCCC Second Harbor Engineering Co., Ltd. 519,496,777 53,549,590
Jiangsu Longyuan Zhenhua Marine Engineering Co., Ltd 399,731,755 15,936,240
CCCC Third Harbor Engineering Co., Ltd. 355,392,406 5,470,566
CCCC Second Highway Engineering Co., Ltd. 292,697,870 182,569,664
Road & Bridge International Co., Ltd. 247,634,918 -
CCCC Third Highway Engineering Co. Ltd. 179,310,027 -
CCCC First Harbor Engineering Co., Ltd. 160,455,055 1,795,091
CCCC Tianjin Industry and Trade Co., Ltd. 119,409,937 -
Road & Bridge International Co., Ltd. 89,878,258 -
China Highway Engineering Consultants Corporation 85,327,728 -
CCCC Fourth Harbor Engineering Co., Ltd 56,200,000 -
Installation Engineering Co., Ltd. of CCCC First Harbor Engineering Co. Ltd. 13,919,210 -
CCCC Electrical and Mechanical Engineering Co., Ltd. 11,561,947 35,920,354
CCCC First Harbor Consultants Co., Ltd. 10,594,847 -
The First Construction Company of CCCC Second Harbor Engineering Co., Ltd 5,875,862 -
China Communications Construction Company Ltd. 3,988,354 153,839,131
CCCC Shanghai Equipment Engineering Co., Ltd. 1,423,925 -
CCCC Financial Leasing Co., Ltd - 54,987,809
China Harbour Engineering Co., Ltd. - 22,547,495
Friede & Goldman, Llc. - 21,714,704
No.3 Co. of The Second Navigational Engineering Bureau, CCCC - 14,538
3,141,301,233 1,378,373,717
185
8 Others
√Applicable □Not applicable
Monetary funds deposited in the related parties
2020 2019
CCCC Finance Company Ltd. 75,000,000 435,344,084
XIII Share-based payment
1 General of share based payment
□Applicable √Not applicable
2 Equity-settled share-based payments
□Applicable √Not applicable
3 Cash-settled share-based payments
□Applicable √Not applicable
4 Modification and termination of share-based payment
□Applicable √Not applicable
5 Others
□Applicable √Not applicable
XIV Commitments and contingencies
1 Significant commitments
√Applicable □Not applicable
Significant external commitments, nature and amount on the balance sheet date
(1) Matters related to capital expenditure commitments
Commitments related to capital expenditure contracted for but not provided in the financial statements as at the balance
sheet date:
2020 2019
Buildings and constructions, machinery equipment 707,709,990 591,419,876
(2) Commitments related to operating lease
According to the irrecoverable operating lease contract concluded, the Group will at least pay rental as follows:
2020 2019
Within 1 year 21,723,707 32,650,110
1-2 years 11,694,538 20,566,302
2-3 years 294,541 11,239,044
Over 3 years 4,500 132,596
33,717,286 64,588,052
(3) L/C commitments
The Group had entrusted the bank to issue several L/Cs to purchase imported components and parts. As at December
31, 2020, the unpaid amount under the L/Cs was about RMB 1,397,778,837 (as at December 31, 2019: RMB 1,698,125,301).
2 Contingencies
(1) Significant contingencies on the balance sheet date
√Applicable □Not applicable
In August 2020, All-China Environment Federation sued the Company and Shanghai Zhenhua Heavy Industries Co.,
Ltd. Changxing Branch (hereinafter referred to as “Changxing Branch”) to Shanghai No. 3 Intermediate People’s Court for air
pollution liability dispute, with the case No. (2020) H 03 MC 274.
186
2020
Changxing Branch and the Company attached great importance to this event and established a special working group
to actively communicate with the Federation. The Company and the Federation reached a settlement intention and jointly
expressed such intention to the court. On January 25, 2021, Shanghai No. 3 Intermediate People’s Court entrusted Nanjing
Institute of Environmental Sciences, MEE (hereinafter referred to as “Nanjing Institute”) to evaluate the damages, deductible
exemption items and deductible deduction items involved in this case. According to the current progress, the Company
judges that the case is likely to be settled by settlement. According to the current practice of environmental civil public
interest litigation in China, the Company preliminarily judges that if the deductible items are supported by the court, the
amount of alternative restoration costs will be reduced to a certain extent.
As of the approval date of the financial statements, Nanjing Institute has not yet carried out the appraisal work, the
settlement agreement has not been reached, and the case has not entered the formal hearing stage. Therefore, the
Company is unable to make a reliable estimate of the result of the case and the possibility and amount of the loss caused by
the case. The Company will continue to follow up the impact of the case.
(2) If the company has no significant contingencies to be disclosed, it shall also explain:
□Applicable √Not applicable
3 Others
□Applicable √Not applicable
XV Post balance sheet events
1 Significant non-adjustment events
□Applicable √Not applicable
2 Profit distribution
□Applicable √Not applicable
3 Sales return
□Applicable √Not applicable
4 Description of other post balance sheet events
□Applicable √Not applicable
XVI.Other significant events
1 Correction of previous accounting errors
(1) Retrospective restatement
□Applicable √Not applicable
(2) Prospective application
□Applicable √Not applicable
2 Debt restructuring
√Applicable □Not applicable
The group and the debtor signed the Debt Repayment Framework Agreement, which agreed to use a newly developed
commercial property and three sets of self-owned equipment of the debtor to offset the loan owed. When the debt-offsetting
assets had no right defects and the ownership change had been completed, the rights and obligations of both parties shall
be terminated, and the claims and debts shall be extinguished. As of December 31, 2020, the ownership transfer of the debt-
offsetting property had been completed. The Group recognized the fair value of the abandoned claims according to the fair
value of the property received, and reversed the bad debt provision for accounts receivable of RMB 64,230,500.
3 Assets exchange
(1) Non-monetary assets exchange
□Applicable √Not applicable
(2) Other assets exchange
□Applicable √Not applicable
187
4 Pension plan
□Applicable √Not applicable
5 Discontinuing operations
□Applicable √Not applicable
6 Segments
(1) Determination basis and accounting policies of reporting segment
√Applicable □Not applicable
The Group determines operating segments based on internal organization structure, management requirements and internal
reporting system, determines reporting segments based on operating segments, and disclose the information of the segments.
Operating segment refers to the component part of the Group that meet the following requirements: (1) it can generate
income and expenses in daily activities; (2) the management of the Group can regularly evaluate its operating results
to determine its allocation of resources and to evaluate its performance; (3) the Group is able to obtain its accounting
information regarding financial position, operating results and cash flows, etc. If two or more operating segments have similar
economic characteristics, and have met a certain conditions, they will be merged into one operating segment.
The Group identified the business as an operating segment for analysis and assessment based on internal organization
structure, management requirement and internal report system.
(2) Financial information of reporting segment
□Applicable √Not applicable
(3) If the Company has no reporting segments or cannot disclose the total assets and liabilities of each reporting
segment, the reasons shall be stated
□Applicable √Not applicable
(4) Other description
√Applicable □Not applicable
Product and labor information
Income from external transactions
2020 2019
Port machinery 14,457,042,916 16,458,563,164
Heavy equipment 1,062,669,195 1,491,597,749
“Building-transfer” project and engineering construction 2,365,760,874 2,564,145,018
Steel structure and related income 3,277,507,651 2,709,430,977
Shipping and others 1,233,658,739 989,117,844
Sales of materials 71,730,251 84,343,163
Equipment lease and others 186,772,026 298,389,968
22,655,141,652 24,595,587,883
Geographic information
Income from external transactions
2020 2019
Chinese Mainland 13,203,886,125 12,728,821,429
Asia (excluding Chinese Mainland) 3,289,553,492 3,469,961,193
Europe 2,604,103,174 3,416,405,499
North America 1,345,494,819 2,205,954,534
Africa 468,958,316 761,455,510
South America 444,522,956 963,140,369
Chinese Mainland (export sales) 1,061,063,332 697,069,989
Oceania 237,559,438 352,779,360
22,655,141,652 24,595,587,883
The income from external transaction is attributable to where the customer is located.
188
2020
Total non-current assets
2020 2019
Chinese Mainland 18,150,805,488 22,450,499,096
Asia (excluding Chinese Mainland) 9,939,268,779 7,270,356,589
Others 66,235,993 41,013,037
28,156,310,260 29,761,868,722
The non-current assets are attributable to where they are located, excluding financial assets, long-term equity
investment, goodwill, deferred income tax assets and other non-current assets.
7 Other significant transactions and events with impacts on investors' decisions
□Applicable √Not applicable
8 Others
□Applicable √Not applicable
XVII. Notes to main items of the financial statements of the parent company
1 Accounts receivable
(1) Disclosure by aging
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Aging Ending book balance
Within 1 year
Including: subitem within 1 year
Sub-total of items within 1 year 14,603,912,380
1-2 years 783,348,172
2-3 years 215,669,424
Over 3 years
3-4 years 140,879,067
4-5 years 333,537,300
Over 5 years 1,059,689,113
Total 17,137,035,456
(2) Disclosure by bad debt calculation method
√Applicable □Not applicable
Unit: Yuan Currency: CNY
December 31, 2020 December 31, 2019
Category Book balance Provision for bad debts Book balance Provision for bad debts
Book value Book value
Proportion Proportion of Proportion Proportion of
Amount Amount Amount Amount
(%) provision (%) (%) provision (%)
Provision for bad debts accrued on an
660,986,510 4 529,388,510 80 131,598,000 753,396,385 5 591,042,385 78 162,354,000
individual basis
Including:
Provision for bad debts by portfolio 16,476,048,946 96 1,274,320,722 8 15,201,728,224 15,325,782,241 95 1,090,238,346 7 14,235,543,895
Including
Total 17,137,035,456 / 1,803,709,232 / 15,333,326,224 16,079,178,626 / 1,681,280,731 / 14,397,897,895
189
Individual provision for bad debts:
√Applicable □Not applicable
Unit: Yuan Currency: CNY
December 31, 2020
Name
Book balance Provision for bad debts Proportion of provision (%) Reason for provision
Accounts receivable 1 277,613,400 146,015,399 53 Counterparty financial shortage
Accounts receivable 2 187,863,245 187,863,246 100 Contract dispute
Accounts receivable 3 93,954,000 93,954,000 100 Counterparty financial shortage
Accounts receivable 4 42,979,947 42,979,947 100 Contract dispute
Accounts receivable 5 26,099,665 26,099,665 100 Contract dispute
Accounts receivable 6 11,037,000 11,037,000 100 Contract dispute
Accounts receivable 7 8,103,043 8,103,043 100 Contract dispute
Accounts receivable 8 6,980,371 6,980,371 100 Contract dispute
Accounts receivable 9 3,300,179 3,300,179 100 Contract dispute
Accounts receivable 10 2,236,498 2,236,498 100 Contract dispute
Accounts receivable 11 819,162 819,162 100 Contract dispute
Total 660,986,510 529,388,510 80 /
Description of individual provision for bad debts:
√Applicable □Not applicable
As at December 31, 2019, the accounts receivables with individual provision for bad debts are as follows:
Book balance Provision for bad debts Estimated credit loss ratio % Reason for provision
Accounts receivable 1 324,708,000 162,354,000 50 Counterparty financial shortage
Accounts receivable 2 182,958,900 182,958,900 100 Contract dispute
Accounts receivable 3 158,184,500 158,184,500 100 Counterparty financial shortage
Accounts receivable 4 27,904,870 27,904,870 100 Contract dispute
Accounts receivable 5 26,911,147 26,911,147 100 Contract dispute
Accounts receivable 6 10,748,869 10,748,869 100 Contract dispute
Accounts receivable 7 7,815,500 7,815,500 100 Contract dispute
Accounts receivable 8 7,463,174 7,463,174 100 Contract dispute
Accounts receivable 9 3,582,135 3,582,135 100 Contract dispute
Accounts receivable 10 2,224,013 2,224,013 100 Contract dispute
Accounts receivable 11 895,277 895,277 100 Contract dispute
753,396,385 591,042,385
Provision for bad debts by portfolio:
□Applicable √Not applicable
If the provision for bad debts is calculated based on the general model of expected credit loss, please refer to other
receivables for disclosure:
□Applicable √Not applicable
(3) Provision for bad debts
□Applicable √Not applicable
The recovered or reversed provision for bad debts with significant amount:
□Applicable √Not applicable
(4) Accounts receivable actually written off in the current period
□Applicable √Not applicable
Write-off of important accounts receivable
□Applicable √Not applicable
(5) Top 5 accounts receivable in terms of ending balance presented by debtor
√Applicable □Not applicable
As at December 31, 2020, top 5 accounts receivable in terms of ending balance presented by debtor summarized and
analyzed as follows:
190
2020
Proportion in total balance of
Balance Provision for bad debts
accounts receivable %
Total accounts receivable of top 5 balances 9,712,993,888 242,665,746 57
As at December 31, 2019, top 5 accounts receivable in terms of ending balance presented by debtor are summarized
and analyzed as follows:
Proportion in total balance of
Balance Provision for bad debts
accounts receivable %
Total accounts receivable of top 5 balances 6,205,808,563 30,765,484 49
(6) Accounts receivable derecognized due to the transfer of financial assets
□Applicable √Not applicable
(7) Amount of assets and liabilities formed by transferring accounts receivable and continuing involvement
□Applicable √Not applicable
Other description:
√Applicable □Not applicable
Accounts receivable with provision for bad debts accrued by credit risk features portfolio are as follows:
2020 2019
Expected credit Expected credit
Book balance of Estimated credit Book balance of Estimated credit
loss for the entire loss for the entire
estimated default loss ratio (%) estimated default loss ratio (%)
duration duration
Within 1 year 14,580,148,080 2 243,597,549 8,402,385,557 1 72,727,500
1-2 years 736,555,945 30 224,110,942 1,158,723,629 4 51,346,322
2-3 years 114,949,424 39 44,717,622 1,354,366,423 5 69,254,171
3-4 years 140,722,707 68 96,047,068 253,416,207 29 73,708,832
4-5 years 176,263,900 36 64,286,079 182,871,427 69 126,053,375
Over 5 years 727,408,890 83 601,561,462 674,551,153 90 606,600,750
16,476,048,946 1,274,320,722 12,026,314,396 999,690,950
Changes in the provision for bad debts of accounts receivable are as follows:
Adjustments
December 31, December 31,
for changes in January 1, 2020 Provision in 2020 Reversal in 2020
2019 2020
accounting policies
2020 1,590,733,335 90,547,396 1,681,280,731 400,585,712 (278,157,211) 1,803,709,232
2019 1,496,719,907 74,767,027 1,571,486,934 188,332,979 (169,086,578) 1,590,733,335
2 Other receivables
Item presentation
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item December 31, 2020 December 31, 2019
Interest receivable
Dividends receivable
Other receivables 5,505,896,413 7,884,801,508
Total 5,505,896,413 7,884,801,508
Other description:
□Applicable √Not applicable
Interest receivable
(1) Classification of interest receivable
□Applicable √Not applicable
(2) Significant overdue interest
□Applicable √Not applicable
191
(3) Provision for bad debts
□Applicable √Not applicable
Other description:
□Applicable √Not applicable
Dividends receivable
(4) Dividends receivable
□Applicable √Not applicable
(5) Significant dividends receivable aging over 1 year
□Applicable √Not applicable
(6) Provision for bad debts
□Applicable √Not applicable
Other description:
□Applicable √Not applicable
Other receivables
(1) Disclosure by aging
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Aging December 31, 2020
Within 1 year
Including: subitem within 1 year
Sub-total of items within 1 year 5,445,670,956
1-2 years 10,638,902
2-3 years 45,823,753
Over 3 years
3-4 years 3,769,928
4-5 years 999,828
Over 5 years 9,318,653
Total 5,516,222,020
(2) Classification by nature of funds
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Nature of funds December 31, 2020 December 31, 2019
Current accounts between subsidiaries 4,966,655,270 7,080,666,063
Taxes on outstanding payment receivable 369,871,269 212,681,400
Bid and performance bonds 58,732,928 230,696,849
Lease payment receivable 33,434,668 33,434,668
Money on call of on-site product service 30,242,063 30,215,954
Staff loan receivable 19,913,638 23,009,961
Customs deposits 33,365,315 38,241,878
Export tax refund 214,352,290
Others 4,006,869 21,502,445
Total 5,516,222,020 7,884,801,508
(3) Provision for bad debts
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Stage I Stage II Stage III
Estimated credit Expected credit loss for the Expected credit loss for
Provision for bad debt Total
losses over the next entire duration (no credit the entire duration (credit
12 months impairment) impairment has occurred)
Balance as at January 1, 2020 4,425,519 5,900,088 10,325,607
Balance as at January 1, 2020 in
current period
192
2020
Stage I Stage II Stage III
Estimated credit Expected credit loss for the Expected credit loss for
Provision for bad debt Total
losses over the next entire duration (no credit the entire duration (credit
12 months impairment) impairment has occurred)
--Transferred to Stage II
--Transferred to Stage III
--Reversal to Stage II
--Reversal to Stage I
Provision in the current period
Reversal in the current period
Write-off in the current period
Charge-off in the current period
Other changes
Balance as at December 31, 2020 4,425,519 5,900,088 10,325,607
Description of significant changes in book balance of other receivables with changes in loss provision in the current
period:
□Applicable √Not applicable
The amount of provision for bad debts in the current period and the basis for assessing whether the credit risk of
financial instruments has increased significantly:
□Applicable √Not applicable
(4) Provision for bad debts
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Changes in current period
December 31, December 31,
Category Recovery or Write-off or
2019 Provision Other changes 2020
reversal charge-off
10,325,607 10,325,607
Total 10,325,607 10,325,607
Those with significant reversal or recovery amount of provision for bad debts:
□Applicable √Not applicable
(5) Other receivables actually written off in the current period
□Applicable √Not applicable
(6) Top 5 other receivables in terms of ending balance presented by debtor
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Proportion in the Balance of provision
Name Nature December 31, 2020 Aging total balance of other for bad debts as at
receivables (%) December 31, 2020
Current accounts of the
Other receivables 1 2,986,812,658 Within 1 year 54
subsidiaries
Current accounts of the
Other receivables 2 772,089,126 Within 1 year 14
subsidiaries
Current accounts of the
Other receivables 3 514,133,383 Within 1 year 9
subsidiaries
Current accounts of the
Other receivables 4 334,014,913 Within 1 year 6
subsidiaries
Current accounts of the
Other receivables 5 105,053,738 Within 1 year 2
subsidiaries
Total / 4,712,103,818 / 85
(7) Receivables involving government subsidies
□Applicable √Not applicable
(8) Other receivables derecognized due to transfer of financial assets
□Applicable √Not applicable
193
(9) Amount of assets and liabilities formed by transferring other receivables and continuing involvement
□Applicable √Not applicable
Other description:
□Applicable √Not applicable
3 Long-term equity investments
√Applicable □Not applicable
Unit: Yuan Currency: CNY
December 31, 2020 December 31, 2019
Item Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Investment in
5,703,647,701 5,703,647,701 5,935,939,243 5,935,939,243
subsidiaries
Investment in joint
3,021,960,352 3,021,960,352 2,812,546,486 2,812,546,486
ventures and associates
Total 8,725,608,053 8,725,608,053 8,748,485,729 8,748,485,729
(1) Investment in subsidiaries
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Increase Decrease Provision for Balance of provision
December 31, December 31,
Invested entity in current in current impairment in for impairment as at
2019 2020
period period current period December 31, 2020
Shanghai Zhenhua Heavy Industries Port Machinery General
2,201,086,744 2,201,086,744
Equipment Co., Ltd.
Nanjing Ninggao New Channel Construction Co., Ltd 100,000,000 100,000,000
Nantong Zhenhua Heavy Equipment Manufacturing Co., Ltd. 1,154,936,900 1,154,936,900
ZPMC Transmission Machinery (Nantong) Co. Ltd. 300,000,000 206,112,853 506,112,853
CCCC Zhenjiang Investment Construction Management
707,000,000 330,561,396 376,438,604
Development Co., Ltd.
CCCC Tianhe Mechanical Equipment Manufacturing Co., Ltd 242,542,999 242,542,999
ZPMC Qidong Marine Engineering Co., Ltd. 203,000,000 203,000,000
CCCC Liyang Urban Investment and Construction Co., Ltd. 243,000,000 120,000,000 363,000,000
Shanghai Zhenhua Shipping Co., Ltd. 140,260,673 140,260,673
Shanghai Zhenhua Ocean Engineering Service Co., Ltd 100,000,000 100,000,000
ZPMC Electric Co., Ltd. 50,000,000 50,000,000
CCCC Investment & Development Qidong Co., Ltd. 192,500,000 192,500,000
ZPMC North America Inc. 18,564,520 18,564,520
ZPMC Netherlands Coperatie U.A. 29,366,084 29,366,084
Shanghai Zhenhua Port Machinery Heavy Industries Co., Ltd. 9,964,200 9,964,200
ZPMC Machinery Equipment Services Co., Ltd. 7,000,000 7,000,000
ZPMC Lanka Company (Private) Limited 6,183,978 6,183,978
ZPMC Middle East Fze 5,271,120 5,271,120
ZPMC Zhangjiagang Port Machinery Co., Ltd. 4,518,000 4,518,000
ZPMC Limited Liability Company 10,172,070 10,172,070
ZPMC Southeast Asia Holding Pte. Ltd. 12,513,114 12,513,114
ZPMC Engineering Africa (Pty) Ltd. 3,084,000 3,084,000
ZPMC Engineering (India) Private Limited 2,953,200 2,953,200
ZPMC Brazil Servio PortuáriosLTDA 2,936,771 2,936,771
ZPMC Korea Co., Ltd. 6,398,059 6,398,059
ZPMC UK LD 2,797,921 2,797,921
ZPMC Australia Company (Pty) Limited 2,708,500 2,708,500
CCCC Rudong Construction Development Co., Ltd. 36,664,600 36,664,600
CCCC Yongjia Construction Development Co., Ltd. 128,000,000 128,000,000
CCCC Zhenhua Lvjian Technology (Ningbo) Co., Ltd. 4,000,000 4,000,000
ZPMC Latin America Holding Corporation 3,307,850 3,307,850
ZPMC GmbH Hamburg 207,940 207,940
ZPMC Fuzhou Offshore Construction Co., Ltd. 5,000,000 5,000,000
CCCC (Dongming) Investment and Construction Co., Ltd. 14,700,000 14,700,000
Total 5,935,939,243 340,812,853 573,104,395 5,703,647,701
194
2020
(2) Investment in joint ventures and associates
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Increase/decrease in the current period Balance of
Profit or loss Adjustment provision for
December 31, Changes Cash dividends or Provision December
Invested entity Further Reduced on investments of other impairment as
2019 in other profit declared to for Others 31, 2020
investment investment under the equity comprehensive at December
equity be distributed impairment 31, 2020
method income
I. Joint ventures
Jiangsu Longyuan Zhenhua Marine
260,880,653 15,179,788 276,060,441
Engineering Co., Ltd
ZPMC Mediterranean Liman
3,735,189 -3,165,847 569,342
Makinalari Ticaret Anonim Sirketi
Sub-total 264,615,842 12,013,941 276,629,783
II. Associates
CCCC Marine Engineering &
16,730,804 185,678 16,916,482
Technology Research Center Co., Ltd.
ZPMC Changzhou Coatings Co., Ltd. 18,315,964 2,241,634 3,984,471 16,573,127
CCCC Estate Yixing Co., Ltd. 183,660,541 5,982,621 2,700,000 186,943,162
CCCC Financial Leasing Co., Ltd 1,785,702,878 118,432,798 -1,271,676 19,713,242 1,883,150,758
CCCC Yancheng Construction
289,766,242 128,750,000 418,516,242
Development Co., Ltd.
China Communications Construction
60,719,949 -1,690,256 -3,776,695 55,252,998
USA Inc.
CCCC South American Regional
186,678,840 -2,462,090 -23,615,519 160,601,231
Company SARL
Shanghai Ocean Engineering
Equipment Manufacturing Innovation 6,355,426 -485,085 5,870,341
Center Co., Ltd.
CCCC Xiongan Urban Construction
1,500,000 6,228 1,506,228
Development Co., Ltd.
Sub-total 2,547,930,644 130,250,000 122,211,528 -28,663,890 26,397,713 2,745,330,569
Total 2,812,546,486 130,250,000 134,225,469 -28,663,890 26,397,713 3,021,960,352
Other description:
Not applicable
4 Operating revenue and operating costs
(1) Operating revenue and operating costs
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in the current period Amount incurred in the previous period
Item
Revenue Cost Revenue Cost
Primary businesses 19,422,614,728 17,180,562,029 22,756,923,775 19,937,920,290
Other business 2,369,957,349 2,199,696,814 2,283,380,655 2,134,841,176
Total 21,792,572,077 19,380,258,843 25,040,304,430 22,072,761,466
2020 2019
Revenue from Costs of primary Revenue from Costs of primary
primary business business primary business business
Port machinery 12,828,666,254 10,833,429,447 15,145,230,759 12,686,901,266
Heavy equipment 2,083,801,661 2,044,333,654 3,127,014,201 2,999,144,824
Steel structure and related income 3,260,709,435 3,164,491,825 2,695,894,313 2,622,346,875
“Building-transfer” project and engineering
1,249,437,378 1,138,307,103 1,788,784,502 1,629,527,325
construction
19,422,614,728 17,180,562,029 22,756,923,775 19,937,920,290
195
Other business revenue and cost are listed as follows:
2020 2019
Revenue from other Costs of other Revenue from Costs of other
business businesses other business businesses
Sales of materials 1,860,879,295 1,857,809,286 1,873,183,009 1,875,749,099
Equipment lease and others 509,078,054 341,887,528 410,197,646 259,092,077
2,369,957,349 2,199,696,814 2,283,380,655 2,134,841,176
(2) Income from contracts
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Classification of Contract XXX-Division Total
Type of goods
Port machinery 12,828,666,254
Steel structure and related income 3,260,709,435
Sales of materials and others 2,305,490,116
Engineering construction project 1,249,437,378
Heavy equipment 2,083,801,661
By region of operation
Chinese Mainland 13,378,873,641
Europe 2,414,485,764
Asia (excluding Chinese Mainland) 2,810,063,459
North America 1,087,667,642
Chinese Mainland (export sales) 1,061,063,332
South America 390,569,869
Africa 372,464,436
Oceania 212,916,701
Market or customer type
Contract type
Revenue recognized at a certain point of time
Port machinery 12,828,666,254
Sales of materials and others 2,305,490,116
Heavy equipment 2,083,801,661
Steel structure and related income 1,695,443,076
Revenue recognized in a certain period of time
Engineering construction project 1,249,437,378
Steel structure and related income 1,565,266,359
By time of goods transfer
By contract term
By sales channel
Total 21,728,104,844
Description of income from contracts:
□Applicable √Not applicable
(3) Performance obligations
□Applicable √Not applicable
(4) Apportionment to remaining performance obligations
□Applicable √Not applicable
Other description:
None
196
2020
5 Investment income
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Amount incurred in Amount incurred in the
Item
the current period previous period
Income from long-term equity investments calculated under cost method 66,771,535 788,958
Income from long-term equity investments calculated under equity method 134,225,469 106,972,779
Investment income from disposal of long-term equity investment 83,283,620
Investment income from held-for-trading financial assets during the holding period 449,951
Dividend income from other equity instrument investment during holding 6,169,971
Interest income from debt investment during holding
Interest income from other debt investment during holding
Investment income from disposal of held-for-trading financial assets 195,487,757
Investment income from disposal of other equity instrument investment
Investment income from disposal of debt investment
Investment income from disposal of other debt investment
Total 486,388,303 107,761,737
Other description:
None
6 Others
□Applicable √Not applicable
XVIII Supplementary information
1 Items of non-recurring profit or loss in current period
√Applicable □Not applicable
Unit: Yuan Currency: CNY
Item Amount Remarks
Profit or loss from disposal of non-current assets 36,620,758
Tax refunds, exemptions and reductions with ultra vires approval or without official approval documents
Government grants included in the current profit or loss (except for the one closely related to the operations of
97,849,026
the Company and gained constantly at a fixed amount or quantity according to certain standard)
Capital occupation fees charged to the non-financial enterprises and included in current profit or loss
Profit generated when the Company’s investment cost in acquiring the subsidiary, affiliated company and joint
venture is less than the fair value of the recognizable net assets of the invested unit at the time of acquiring
Profit or loss from non-monetary assets exchange
Profit or loss from the assets entrusted to others for investment or management
Provisions for impairment of assets accrued due to force majeure such as natural disaster
Profit or loss from debt reorganization
Cost for enterprise reorganization, such as staffing expenses and integration fees
Profit or loss in excess of the fair value generated in transaction with unfair price
Current net profit or loss of the subsidiary generated from the business combination under common control from
the beginning of the period to the combination date
Profit or loss from the contingencies, unrelated to the normal business of the Company
Profit or loss on changes in fair values of held-for-trading financial assets, derivative financial assets, held-
for-trading financial liabilitiesand derivative financial liabilities, and investment income obtained from disposal
of held-for-trading financial assets, derivative financial assets, held-for-trading financial liabilities, derivative 356,116,979
financial liabilities and other credit investment, except for effective hedging operations associated with the
company's normal operations
Reversal of provision for impairment of receivables and contract assets subject to separate impairment test 78,007,100
Profit or loss from external entrusted loans
197
Item Amount Remarks
Profit or loss on changes in fair value of investment property by follow-up measurement in fair value mode
Impact on current profit or loss due to one-off adjustment to current profit or loss according to the requirements
of tax and accounting laws and regulations
Custody fees of entrusted operation
Other non-operating revenue and expenses except for the above-mentioned items 4,718,614
Other profit or loss items that conform to the definition of non- recurring profit or loss
Affected amount of income tax -77,383,660
Affected amount of minority equity -15,226,311
Total 480,702,506
For the non-recurring profit or loss items defined by the Company according to the "Explanatory Announcement on
Information Disclosure of Companies Offering Securities to the Public No. 1 - Non-recurring Profit or Loss", and the recurring
profit or loss items defined by the non-recurring profit or loss items listed in "Explanatory Announcement on Information
Disclosure of Companies Offering Securities to the Public No. 1 – Non-recurring Profit or Loss”, reasons shall be explained.
□Applicable √Not applicable
2 Return on net assets and earnings per share
√Applicable □Not applicable
Earnings per share
Weighted average rate of
Profit in the reporting period Basic earnings Diluted earnings
return on net assets (%)
per share per share
Net profit attributable to ordinary shareholders of the Company 3.04 0.08 0.08
Net profit attributable to ordinary shareholders of the Company
-0.43 -0.01 -0.01
after deducting non-recurring profits and losses
3 Differences in accounting data under domestic and overseas accounting standards
□Applicable √Not applicable
4 Others
□Applicable √Not applicable
198
2020
Section XII List of Reference Documents
List of Reference Financial statements affixed with the signature and seal of legal representative, person in charge of accounting
Documents work and person in charge of accounting agency
List of Reference Original auditors' report stamped by the accounting firm and signed and stamped with the certified public
Documents accountants.
List of Reference Original copies of the documents and announcement of the Company published on the newspaper designated
Documents by the CSRC in the reporting period.
Chairman: Liu Chengyun
Date of reporting approved by the Board of Directors: March 30, 2021
Revision information
□Applicable √Not applicable
199
