ANNOUNCEMENT OF INTERIM RESULTS 2020
Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.
(A joint stock limited company incorporated in the People's Republic of China with limited liability)
(Stock Code: 0042)
UNAUDITED RESULTS ANNOUNCEMENT FOR
THE SIX MONTHS ENDED 30 JUNE 2020
The Board of Directors (the "Board") and the directors (the "Directors") of the Northeast Electric Development Company Limited (the "Company") hereby announce the unaudited interim results of the Company and its subsidiaries (the "Group") as of 30 June 2020.
Chapter 1 IMPORTANT NOTICE
- The Board, Supervisory Committee, Directors, Supervisors and senior management of the Company hereby confirm that there are no false representations, misleading statements or material omissions contained in this report, and they, severally and jointly, accept full responsibility for the truthfulness, accuracy and completeness of the contents of this interim report.
- The Company's Chairman Zhu Jie, Chief Financial Officer Wang Kai and Chief Accounting Officer Wang Kai hereby represent: guaranteeing the truthfulness, accurateness and integrity of the financial reports in the interim report.
- This announcement has been considered and approved by the seventeenth meeting of the 9th Board convened on 28 August 2020. All Directors attended the Board meeting in person to consider and approve this report.
- The Group prepared the Unaudited Results Announcement for the Six Months Ended 30 June 2020 in accordance with the PRC GAAP and IFRS. The audit committee of the Board has reviewed and confirmed the Company's interim results announcement for 2020. The audit committee has approved the financial accounting principles, standards and methods adopted by the Company for the unaudited interim accounts for the six months ended 30 June 2020.
- The Company proposes not to distribute cash dividend, issue bonus share, or capitalise from capital reserves.
- The consolidated turnover is RMB37,838,800.
- The profit attributable to equity holders of the Company is RMB-11,818,400.
- Earnings per share attributable to equity holders of the Company are RMB-0.0135.
- Unless otherwise stated, Renminbi is the only monetary unit in this announcement.
- This announcement is made pursuant to Rule 13.49(6) of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited and Paragraph 46 of Note 16 thereto.
NORTHEAST DEVELOPMENTELECTRIC LTD.CO.,
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NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
1.11 Definitions
CSRC | China Securities Regulatory Commission |
De facto controller of the | Hainan Liberation Commonweal Foundation |
Company | |
Beijing Haihongyuan | Beijing Haihongyuan Investment Management Co., Ltd., |
a substantial shareholder of the Company | |
NEE, the Company | Northeast Electric Development Company Limited |
Fuxin Busbar | Fuxin Enclosed Busbar Co., Ltd., a subsidiary of the |
Company | |
NEE Chengdu | Northeast Electric (Chengdu) Electric Engineering |
Design Co., Ltd., a subsidiary of the Company | |
Garden Lane Hotel | Hainan Garden Lane Flight Hotel Management Co., |
Ltd., a subsidiary of the Company | |
HNA Hotel (Hong Kong) | HNA Hotel Group (Hong Kong) Co., Ltd., a related |
party of the Company | |
HNA Group | HNA Group Co., Ltd., a related party of the Company |
Shenyang Intermediate | Shenyang Municipal Intermediate People's Court of |
People's Court | Liaoning |
Hainan First Intermediate | The First Intermediate People's Court of Hainan |
People's Court | Province |
Tiexi SASAB | Tiexi District State-owned Assets Supervision and |
Administration Bureau of Shenyang | |
Shenyang HVS, Shenyang High | Shenyang High Voltage Switchgear Co., Ltd. |
Voltage Switchgear |
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Chapter 2 CORPORATE PROFILE
2.1 Basic information
Stock abbreviation of A shares | ST Northeast Electric | A shares stock code | 000585 |
Place of the listing of A Shares | Shenzhen Stock Exchange | ||
Stock abbreviation of H shares | Northeast Electric | H shares stock code | 0042 |
Place of the listing of H shares | The Stock Exchange of Hong Kong Limited | ||
Legal Chinese name | 東北電氣發展股份有限公司 | ||
Chinese abbreviation | 東北電氣 | ||
Legal English name | Northeast Electric Development Company Limited | ||
English abbreviation | NEE | ||
Legal representative | Zhu Jie |
2.2 Contact person and contact information
Secretary to the Board | Representative for securities affairs | |
Name | Ding Jishi | Zhu Xinguang, Ju Meng |
Address | 22nd Floor, HNA Plaza, No.7 Guoxing | 22nd Floor, HNA Plaza, No.7 Guoxing |
Road, Meilan District, Haikou City, | Road, Meilan District, Haikou City, | |
Hainan Province | Hainan Province | |
Telephone | 0898-68876008 | 0898-68876008 |
Fax | 0898-68876033 | 0898-68876033 |
dbdqdshbgs@hnair.com | nemm585@sina.com |
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2.3 Additional information
Registered address | Room A1-1077, 5th Floor, Building A, |
Entrepreneurship Incubation Center, Haikou | |
National High-tech Zone, No.266 Nanhai Avenue, | |
Haikou City, Hainan Province | |
Postal code | 571152 |
Office address | 22nd Floor, HNA Plaza, No.7 Guoxing Road, Meilan |
District, Haikou City, Hainan Province | |
Postal code | 570203 |
Website | www.nee.com.cn |
E-mail address | dbdqdshbgs@hnair.com |
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
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Chapter 3 PRINCIPAL FINANCIAL DATA AND INDICATORS
- Principal financial data and indicators prepared under the PRC GAAP
Amount for | Increase/decrease in | ||
Amount for | the same | the reporting period | |
the reporting | period of | compared with the same | |
period | last year | period of last year | |
Operating incomes (RMB) | 37,838,750.59 | 45,163,758.53 | -16.22% |
Net profits attributable to shareholders | |||
of the listed company (RMB) | -11,818,431.23 | -3,924,330.74 | N/A |
Net profits attributable to shareholders | |||
of the listed company after extraordinary | |||
items (RMB) | -13,119,309.96 | -3,924,330.74 | N/A |
Net cash flows arising from operating | |||
activities (RMB) | 61,702,699.13 | -2,091,919.29 | N/A |
Basic earnings per share (RMB/Share) | -0.0135 | -0.0045 | N/A |
Diluted earnings per share (RMB/Share) | -0.0135 | -0.0045 | N/A |
Weighted average return on net assets | N/A | N/A | N/A |
As at | Increase/decrease in | ||
the end of | As at | the reporting period | |
the reporting | the end of | compared with the end | |
period | last year | of last year | |
Total assets (RMB) | 474,674,913.01 | 477,041,464.23 | -0.50% |
Net assets attributable to shareholders | |||
of the listed company (RMB) | -67,768,465.95 | -56,590,261.98 | N/A |
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Extraordinary items
Unit: RMB | |
Item | Amount |
Government subsidy included in the current profits and losses (closely related to | |
business of the enterprise, excluding the government subsidy enjoyed fully or | |
quantitatively according to uniform standards of the country) | 668,955.66 |
Other non-operating income and expense other than the above items | 1,076,332.82 |
Less: Effect of income tax | 436,322.12 |
Impact on minority interests (after tax) | 8,087.63 |
Total | 1,300,878.73 |
- Principal financial data and indicators prepared in accordance with the International Financial Reporting Standards (IFRS)
Condensed Consolidated Statement of Profit or Loss
Unit: RMB'000 | |||
Reporting period | The same period | ||
(January-June) | of previous year | ||
Turnover | 37,838 | 45,163 | |
Profit before tax | (11,594) | (3,388) | |
Taxation | (280) | (520) | |
LTD. | Profit after tax | (11,874) | (3,909) |
Minority Interests | (56) | 15 | |
CO., | |||
Profits attributable to shareholders | (11,818) | (3,924) | |
NORTHEAST ELECTRIC DEVELOPMENT | |||
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Condensed Consolidated Statement of Financial Position
Unit: RMB'000 | ||
At the end of this | At the end of | |
reporting period | previous year | |
Total assets | 474,675 | 477,387 |
Total liabilities | 537,015 | 528,494 |
Shareholders' equity | (62,340) | (51,107) |
- Description of differences in figures under domestic and foreign accounting standards
There are no differences in net profits and net assets prepared under the PRC GAAP and IFRS.
LTD.CO.,
DEVELOPMENTELECTRIC
NORTHEAST
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Chapter 4 C H A N G E S I N SHAREHOLDER
S H A R E S A N D INFORMATION
4.1 Changes in shares
Unit: Share
Before the change | Increase/decrease (+, -) arising from the change | After the change | |||||||||
Conversion of | |||||||||||
Issue of new | capital reserve | ||||||||||
Number | Percentage | shares | Bonus issue | into shares | Others | Subtotal | Number | Percentage | |||
I. Shares subject to trading moratorium | 5,999,022 | 0.69% | 0 | 0 | 0 | 0 | 0 | 5,999,022 | 0.69% | ||
1. | State-owned shares | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% | |
2. | State-owned legal person shares | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% | |
3. | Other domestic shares | 5,999,022 | 0.69% | 0 | 0 | 0 | 0 | 0 | 5,999,022 | 0.69% | |
Including: Domestic legal person shares | 5,999,022 | 0.69% | 0 | 0 | 0 | 0 | 0 | 5,999,022 | 0.69% | ||
Domestic natural person shares | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% | ||
4. | Foreign shares | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% | |
Including: Overseas legal person shares | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% | ||
Overseas natural person shares | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% | ||
II. Shares not subject to trading moratorium | 867,370,978 | 99.31% | 0 | 0 | 0 | 0 | 0 | 867,370,978 | 99.31% | ||
LTD. | |||||||||||
1. | Renminbi ordinary shares | 609,420,978 | 69.78% | 0 | 0 | 0 | 0 | 0 | 609,420,978 | 69.78% | |
CO., | |||||||||||
2 Foreign shares listed domestically | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% | ||
DEVELOPMENTELECTRICNORTHEAST | |||||||||||
3. | Foreign shares listed overseas | 257,950,000 | 29.53% | 0 | 0 | 0 | 0 | 0 | 257,950,000 | 29.53% | |
4. | Others | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 0 | 0.00% | |
III. Total shares | 873,370,000 | 100.00% | 0 | 0 | 0 | 0 | 0 | 873,370,000 | 100.00% | ||
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4.2 Number of shareholders and shareholding
Unit: Share | ||||||||||
Total number of ordinary shareholders | Total number of preferred shareholders with voting rights restored at the | |||||||||
at the end of the reporting period | 55,036 | end of the reporting period (if any) | 0 | |||||||
Shareholdings of ordinary shareholders holding more than 5% of the total share capital or the top ten ordinary shareholders | ||||||||||
Number of | Number of | Number of | Shares pledged or frozen | |||||||
ordinary | ordinary | ordinary | ||||||||
shares as at | Increase/ | shares held | shares held not | |||||||
the end of the | decrease in the | subject to | subject to | |||||||
reporting | reporting | trading | trading | Status of | ||||||
Name of shareholder | Nature of shareholder | Percentage | period | period | moratorium | moratorium | shares | Number | ||
HKSCC Nominees Limited | Overseas legal person | 29.44% | 257,097,899 | -60,000 | 0 | 257,097,899 | ||||
Beijing Haihongyuan Investment | Domestic | 9.33% | 81,494,850 | 0 | 0 | 81,494,850 | Pledged | 81,494,850 | ||
Management Co., Ltd. | non-state-owned | |||||||||
legal person | ||||||||||
Zhao Rui | Domestic natural person | 0.71% | 6,167,810 | +3,432,100 | 0 | 6,167,810 | ||||
Jin Lei | Domestic natural person | 0.66% | 5,723,710 | +5,723,710 | 0 | 5,723,710 | ||||
Fu Lianjun | Domestic natural person | 0.57% | 4,974,489 | 0 | 0 | 4,974,489 | ||||
Huang Tao | Domestic natural person | 0.54% | 4,675,609 | +4,675,609 | 0 | 4,675,609 | ||||
Miao Haonan | Domestic natural person | 0.51% | 4,428,812 | +2,236,802 | 0 | 4,428,812 | ||||
Gao Yan | Domestic natural person | 0.44% | 3,834,094 | +3,834,094 | 0 | 3,834,094 | ||||
Shi Yubo | Domestic natural person | 0.41% | 3,568,200 | +8,200 | 0 | 3,568,200 | ||||
Shenzhen Zhongda Software | Domestic | 0.41% | 3,550,000 | 0 | 0 | 3,550,000 | ||||
Development Co., Ltd. | non-state-owned | |||||||||
legal person | ||||||||||
A strategic investor or ordinary legal person becoming a top ten | ||||||||||
ordinary shareholder after placing of new shares (if any) | Nil | |||||||||
Explanation on the connected relationship or concerted action | So far as the Company is aware, there is no connected relationship among the above shareholders or are parties acting in | |||||||||
of the above shareholders | concert as required in the Measures for the Administration of the Takeover of Listed Companies. | |||||||||
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Shareholdings of the top ten holders of ordinary shares not subject to trading moratorium | |||||
Number of ordinary shares | Type of shares | ||||
held not subject to trading | |||||
moratorium at the end of | |||||
Name of shareholder | the reporting period | Class of shares | Number | ||
HKSCC Nominees Limited | 257,097,899 | Overseas listed | 257,097,899 | ||
foreign shares | |||||
Beijing Haihongyuan Investment | 81,494,850 | RMB ordinary | 81,494,850 | ||
Management Co., Ltd. | shares | ||||
Zhao Rui | 6,167,810 | RMB ordinary | 6,167,810 | ||
shares | |||||
Jin Lei | 5,723,710 | RMB ordinary | 5,723,710 | ||
shares | |||||
Fu Lianjun | 4,974,489 | RMB ordinary | 4,974,489 | ||
shares | |||||
Huang Tao | 4,675,609 | RMB ordinary | 4,675,609 | ||
shares | |||||
Miao Haonan | 4,428,812 | RMB ordinary | 4,428,812 | ||
shares | |||||
Gao Yan | 3,834,094 | RMB ordinary | 3,834,094 | ||
shares | |||||
Shi Yubo | 3,568,200 | RMB ordinary | 3,568,200 | ||
shares | |||||
Xu Lirong | 3,487,200 | RMB ordinary | 3,487,200 | ||
LTD. | shares | ||||
Explanation on the connected relationship | So far as the Company is aware, there is no connected relationship | ||||
CO., | |||||
or concerted action among the top ten | among the top ten holders of ordinary shares not subject to trading | ||||
DEVELOPMENT | holders of ordinary shares not subject to | moratorium or between them and the top ten ordinary shareholders or | |||
trading moratorium and that between them | are parties acting in concert as required in the Measures for the | ||||
and the top ten ordinary shareholders | Administration of the Takeover of Listed Companies. | ||||
Explanation on the top ten ordinary | Nil | ||||
shareholders involved in securities margin | |||||
NORTHEAST ELECTRIC | trading business | ||||
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Notes:
- Based on the information that is publicly available as at the latest practicable date prior to the publishing of this interim report and within the knowledge of the Directors, there was sufficient public float of the Company's shares.
- Save as disclosed above, as at 30 June 2020, the Directors were not aware that any person (excluding Directors, Supervisors, or chief executives (if applicable) or senior management of the Company, the "Senior Management") had any interests or short positions in the shares or underlying shares (as the case may be) of the Company which were required to be notified to the Company and the Hong Kong Stock Exchange pursuant to Divisions 2 and 3 of Part XV of the Securities and Futures Ordinance ("SFO") in Chapter 571 of the Laws of Hong Kong, any interests which were required to be recorded in the register pursuant to Section 336 of the SFO, or was a substantial shareholder of the Company (as defined in the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Listing Rules")).
- During the reporting period, neither the Company nor any of its subsidiaries had purchased, sold or redeemed any of the Company's shares.
- There is no provision for pre-emptive rights under the laws of the PRC and the Articles of Association of the Company.
- As of 30 June 2020, the Company did not issue any convertible securities, options, warrants or any other similar right.
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NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
Chapter 5 P R O F I L E S O F D I R E C T O R S ,
S U P E R V I S O R S A N D S E N I O R MANAGEMENT
-
Changes in shareholdings of Directors, supervisors and senior management
There was no change in shareholdings during the reporting period. - Changes in Directors, supervisors and senior management
Name | Position | Type | Date | Reason | |
Li Rui | Vice Chairman, general manager | Resigned | 10 | January 2020 | Work adjustment |
Ma Yun | Director | Resigned | 19 | May 2020 | Work adjustment |
Liu Huafen | Director | Resigned | 19 | May 2020 | Work adjustment |
Wang Hongyu | Independent Director | Elected | 29 | June 2020 | Operational needs |
Wang Yongfan | Director | Elected | 29 | June 2020 | Operational needs |
Li Guoqing | Director | Elected | 29 | June 2020 | Operational needs |
Guo Qianli | Director | Elected | 29 | June 2020 | Operational needs |
5.3 Equity interest of Directors, supervisors and senior management
Save as disclosed above and to the knowledge of the Directors, senior management and supervisors of the Company, as at 30 June 2020, none of the Directors, senior management and supervisors had any interests or short positions in the shares, underlying shares and/or debentures (as the case may be) of the Company and/or any of its associated corporations (within the meaning of Part XV of the SFO, Chapter 571 of the Laws of Hong Kong) which were required to be notified to the Company and the Hong Kong Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests or short positions which are taken to have by such Directors, senior management and supervisors under provisions of the SFO), or which were required to be recorded in the register maintained by the Company pursuant to Section 352 of the SFO, or which were required to be notified to the Company and the Hong Kong Stock Exchange pursuant to the "Model Code for Securities Transactions by Directors of Listed Issuers" in Appendix X to the Listing Rules.
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Chapter 6 SUMMARY OF BUSINESS
-
Overview
The Company has been primarily engaged in the R&D, design, production and sales businesses of products related to power transmission and transformation equipment. Our main products are enclosed busbars that are mainly applied to the power system field to enhance the transmission efficiency of power transmission lines and support the transmission of high power electric energy. Enclosed busbar plays an important role in the power system. Besides, Hainan Garden Lane Flight Hotel Management Co., Ltd., a holding company of the Company, actively expanded its hotel management, catering and accommodation businesses during the reporting period.
There was no material change in the principal business of the Company during the reporting period.
During the reporting period, the turnover calculated under the PRC GAAP and IFRS was RMB37,838,800, representing a decrease of 16.22% as compared to RMB45,163,700 for the corresponding period of the previous year; earnings attributable to shareholders after tax and minority interests amounted to RMB-11,818,400, with earnings per share of RMB-0.0135.
No dividend was paid during the period and the Directors do not recommend the payment of the interim dividend for the six months ended 30 June 2020. - Business review for the first half of 2020
In the first half of 2020, the COVID-19 outbreak has wreaked havoc on global economy and trade. Coupled with the rising protectionism and anti-globalization movement, the prospects for the recovery of the world economy are gloomy. In the face of the ordeal brought by the COVID-19 epidemic and the complicated and changeable domestic and overseas environment, the whole country corporately promoted the epidemic prevention and control as well as the economic and social development. As a result, the epidemic prevention and control continued to improve, and the resumption of work, production, business and market was accelerated. In the first half of 2020, China's economy recorded growth despite an earlier decline. Economic growth turned from negative to positive with key indicators resuming growth and economic performance recovering steadily in the second quarter. Also, given the strong supply to basic needs for the people and generally positive market expectations, the overall situation of social development was stable.
In the first half of this year, the production and operations of the machinery industry were back to track generally, with key indicators achieving a significant rebound. The overall development environment of the industry is promising, while the trend of the main sectors, which account for more than 80% of the machinery industry, tends to be positive. It is expected that the economic operation of the machinery industry for the whole year will show a gradual rebound after suffering a decline, with an expectation for the industrial added value, operating income, total profits and other indicators to achieve a slight positive growth.
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NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
The Company has primarily engaged in the R&D, design, production and sales businesses of products related to power transmission and transformation equipment in recent years. Our main products are enclosed busbars that are mainly applied to the power system field to enhance transmission capacity of the power transmission line, and support the transmission of high power electric energy. Enclosed busbar plays an important role in the power system. Besides, Hainan Garden Lane Flight Hotel Management Co., Ltd., a holding company of the Company, actively expanded its hotel management, catering and accommodation businesses during the reporting period.
During the reporting period, the hotel industry in which the Company operates was greatly hit by COVID-19, combined with the impact of macro-economic structural adjustments on the power transmission and distribution equipment industry, the industry experienced excess production capacity and intense market competition. The Company has therefore faced increasing operational pressure. In the face of such a complex and difficult situation, all personnel of the Company adhered to the overall work plan, worked diligently to fulfill their duties, and strived to achieve breakthroughs. Under the leadership of the Board, the Company properly dealt with various challenges, fully implemented the resolutions approved at the general meeting and by the Board, optimized its industrial distribution, enhanced operation management, and steadily advanced various work activities.
During the reporting period, the operating income of the Company amounted to RMB37,838,800, representing a decrease of RMB7,325,000 or 16.22% compared with the same period of last year.
Major works during the reporting period are as follows:
-
Risk warning on delisting for A shares of the Company
According to the Audit Report of Northeast Electric Development Co., Ltd. issued by Mazars Certified Public Accountants LLP on 29 April 2020 (Mazars Shen Zi [2020] No. 170018), the Company recorded an operating income of RMB102,341,085.77, a net profit attributable to shareholders of the listed company of RMB-40,165,739.76, and a net asset attributable to shareholders of the listed company of RMB-56,590,261.98 in 2019. Shenzhen Stock Exchange implemented a risk warning on delisting for A shares of the Company from the commencement of trading on 6 May 2020, subject to Rule 13.2.1 of the Listing Rules of Shenzhen Stock Exchange.
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-
Acquisition of minority interests in Chongqing Hotel
To further explore hotel-related businesses of the listed Company, Garden Lane Hotel, a holding company of the Company, entered into the Equity Transfer Agreement of Chongqing HNA Hotel Investment Co., Ltd., (hereinafter referred to as "Chongqing Hotel) with HNA Hotel Holding Group Company Limited (hereinafter referred to as "HNA Hotel Holding") on 26 April 2020 (for more details, please refer to the Announcement on the Acquisition of Minority Interests in Chongqing HNA Hotel Investment Co., Ltd. and Connected Transaction (announcement No.: 2020-013)). According to the Asset Valuation Report on Market Value of Equities to be Purchased by Hainan Garden Lane Flight Hotel Management Co., Ltd Involving the Entire Equities of Chongqing HNA Hotel Investment Co., Ltd. [ZWZXPZZ (2020) No. 5005-1] issued by Zhong Wei Zheng Xin (Beijing) Asset Appraisal Co., Ltd., the appraised value of the net assets of Chongqing Hotel was RMB163,338,600 based on the valuation date of 31 December 2019. Garden Lane Hotel paid RMB48.9 million in cash as consideration to acquire 15 million shares from HNA Hotel Holding, accounting for 30% equity interests of Chongqing Hotel. Such an acquisition of equity interest in Chongqing Hotel helped the listed company expand hotel business and enabled the Company to strengthen business cooperation through equity cooperation, realize effective distribution of resources, and further optimize capacities in risk tolerance and continuing operation. The transaction used the internal funds of the Company, so it would not result in a change in the scope of the Company's consolidated financial statements, adversely affect the Company's financial position and results of operations, be detrimental to the interests of the Company and all shareholders, or have a material impact on the Company.
- Government's expropriation of the South Plant of the Company's subsidiary Fuxin Enclosed Busbar Co., Ltd.
After Fuxin Enclosed Busbar Co., Ltd. (hereinafter referred to as "Fuxin Busbar"), a holding subsidiary of the Company, was relocated to the new plant at No. 369 Yulong Road, Hexi Village, Sihe Township, Xihe District, Fuxin in 2018, its South Plant (including land, industrial properties, structures and supporting facilities) at No. 46 Xinhua Road, Haizhou District, Fuxin, Liaoning Province falls into the expropriation scope planned and approved by Fuxin People's Government. For the purposes of active cooperation with the implementation of urban planning and protecting the interests of all shareholders and core assets of the listed company at the same time, Fuxin Busbar entered into the Agreement on Compensation for Land Expropriation (for more details, please refer to the Announcement on the Expropriation of the South Plant of the Subsidiary Fuxin Enclosed Busbar Co., Ltd. by the Government (announcement No.: 2020-014)) with Haizhou House Expropriation Office of Fuxin (hereinafter referred to as "Expropriation Office", a public institution under Haizhou District People's Government of Fuxin), pursuant to which, the Expropriation Office expropriated the above-mentioned plant owned by Fuxin Busbar. The total compensation for Fuxin Busbar as a result of the expropriation is RMB44 million. The Proposal on the Expropriation of the South Plant of the Subsidiary Fuxin Enclosed Busbar Co., Ltd. by the Government was considered and approved at the thirteenth meeting of the 9th Board of the Company held on 26 April 2020 and the annual general meeting for 2019 held on 29 June 2020, respectively.
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NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
(IV) Termination of non-public issuance of H shares
In view of the fact that the Share Subscription Agreement for the non-public issuance of H shares entered into by the Company and HNA Hotel Group (Hong Kong) Company Limited on 5 April 2017 has been terminated automatically due to the expiration on 30 June 2020, the Company held the 16th meeting of the ninth Board and the 11th meeting of the ninth Supervisory Committee on 14 July 2020 to consider and approve the Resolution on the Termination of Non-public Issuance of H Shares and the Withdrawal of Relevant Application Documents, and determined to terminate the non-public issuance and to apply to the CSRC for withdrawing the application documents for the non-public issuance of H shares. On 27 August 2020, the Company received the Notice of the CSRC on Terminating the Review on Application of Administrative Permission issued by the CSRC, in which the CSRC decided to determine the review on application of administrative permission made by the Company in accordance with relevant provisions of Article 20 of the Regulations of the China Securities Regulatory Commission on the Implementation Procedures of Administrative Permission. (For details, please refer to the Announcement on the Receipt of Notice of the CSRC on Terminating the Review on Application of Administrative Permission (Announcement No.: 2020-044))
-
Progress of material litigations
1. Shenyang Tiexi District State-owned Assets Supervision and Administration Bureau vs. the Company for the payment of allowance for staff. On 12 June 2018, the case was heard in the Shenyang Intermediate People's Court. On 18 July, the Shenyang Intermediate People's Court issued the Civil Judgment ((2017) Liao 01 Min Chu No.430). The Shenyang Intermediate People's Court held that when the plaintiff Tiexi SASAB reclaimed its rights to NEE on 21 July 2016, it had been more than two years of statute of limitations. The Shenyang Intermediate People's Court rejected the claim that the plaintiff Tiexi SASAB requested the defendant NEE to pay arrears of RMB28.53 million, interest and liquidated damages. The Shenyang Intermediate People's Court judged as follows: (1) The defendant Shenyang HVS shall pay the plaintiff Tiexi SASAB arrears of RMB24.99 million and liquidated damages of RMB1,249,500 within 15 days from the date when the judgment takes effect; (2) Reject the other claims of the plaintiff Tiexi SASAB. The case acceptance fee of RMB230,526 shall be borne by the defendant Shenyang HVS. If any party concerned disagrees with this judgment, it may submit an appeal to the court within 15 days from the date of service of the judgment and appeal to the Liaoning Provincial Higher People's Court. The plaintiff Tiexi SASAB has appealed to Shenyang Intermediate People's Court during the appeal period. In the early December 2018, Liaoning Provincial Higher People's Court accepted the appeal. On 8 May 2019, the case was tried in the second instance. On 21 August 2019, the Civil Order ((2018) Liao Min Zhong No. 1032) was issued by Liaoning Provincial Higher People's Court, ruling as follows: The Civil Judgment ((2017) Liao 01 Min Chu No. 430) issued by Shenyang Municipal Intermediate People's Court of Liaoning shall be abrogated; A retrial for this case shall be performed by Shenyang Municipal Intermediate People's Court of Liaoning. The case has been transferred from Shenyang Intermediate People's Court to the jurisdiction of Hainan First Intermediate People's Court on 11 February 2020 and has come to trial on 10 August 2020. No judgment has yet been made.
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2. The legal proceeding involving the subsidiary Fuxin Enclosed Busbar Co., Ltd. 74.4% of the equity in New Northeast Electric (Shenyang) High-voltage Insulated Switchgears Co., Ltd. (formerly known as Shenyang Suntime High Voltage Electric Co., Ltd.) (the "Underlying Equity") was held by Fuxin Busbar prior to 22 September 2008. Due to the enforcement of the final judgment ((2008) Min Er Zhong Zi No. 23) made by the Supreme People's Court on 5 September 2008 for the case of China Development Bank and under the coordination, Fuxin Busbar returned the Underlying Equity to Shenyang High Voltage Switchgear Co., Ltd. ("Shenyang HVS") free of charge, and completed the change of equity registration on 22 September 2008 as required by the local industrial and commercial administration. Therefore, the Underlying Equity held by Fuxin Busbar was returned to Shenyang HVS free of charge. However, according to the enforcement ruling issued by the Supreme People's Court on 31 August 2017 ((2017) Zui Gao Fa Zhi Fu No. 27), "the fact that the return of the Underlying Equity free of charge under the coordination of NEE cannot be ascertained". Given the failure of Shenyang HVS to pay the outstanding consideration of USD16 million for equity transfer constituted a breach of contract, the plaintiff Fuxin Busbar, in order to protect its interests, raised litigation against the above 2 defendants, namely, Shenyang HVS and NEE, claiming for the return of the consideration for the transfer of the Underlying Equity. The Higher People's Court of Hainan Province accepted the case on 30 November 2018 (case No.: (2018) Qiong Min Chu No. 69), and delivered the documents such as pleadings to Shenyang HVS on 3 January 2019. The written judgment of the first instance was received on 20 May 2019. As the defendants did not appeal within the announcement period, the judgment of the first instance has come into effect since 7 August 2019 and NEE bears no joint and several liabilities.
6.3 Analysis of core competitiveness
Thanks to the long-term accumulation in many aspects such as product quality, brand culture, R&D capability, technology, management service and marketing over the years, the Company shows some advantages and industrial competitiveness, which can be seen in the close association between the development of the industry where the Company operates and macroeconomic policies of the State; a certain association between the market and macroeconomic development; advanced production equipment and strong manufacturing capabilities of power transmission and distribution products; accumulation of technological strength and high professional technological level; sound internal control system and standardized corporate governance; certain product development capabilities and investment and financing capabilities.
There were no material changes in the core competitiveness of the Company during the reporting period.
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NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
- Risks faced by the Company and measures
-
Market risks arising from macro-economic environment
The industry in which the Company operates is closely connected with the demands of the power equipment industry. The prosperous level of the industry is also directly pegged with the national economy. Given its significant impact on the Company, we will keep focusing on the impact of the national macroeconomy and the global economy over the industry. At the same time, as the hotel management industry where the Company operates was notably influenced by the epidemic in the first half of 2020, it is estimated that the epidemic will continue to have a significant impact on the operations of the Company for some time to come. Hence, the Company will carry out relevant epidemic prevention and control in strict accordance with the requirements of the relevant government departments while trying to apply for government support policies. - Risk of market competition
Enclosed busbars produced and hotel-related businesses operated by the Company are its principal activities. Intensifying market competition creates an adverse impact on the average profit margin of the industry. The Company will continue to improve its technology, strengthen innovation ability, scale up production, and enhance the efficiency of operation and management, along with efforts to prevent the decrease in operating income, gross margin of products and services as well as profitability caused by the outbreak of the epidemic, thereby strengthening the sustainable operation capacity of the Company. - Risk of strategic transformation
To facilitate the sustainable development of the Company in the mid and long term, the Company is seeking strategic transformation by tapping into such a modern service industry as hotel. The Company may have the risk of strategic transformation slippage, and even failure, provided that the transformation is not carried out as early as possible for various reasons. The Company will actively promote the related work, while developing relevant businesses to realize strategic transformation gradually through various methods.
-
Market risks arising from macro-economic environment
- Prospects for the second half of the year
Centered on the annual business objectives and work tasks for 2020, the Company's management will adopt comprehensive measures to change the loss-making situation by enhancing the operation efficiency and core competitiveness. For details, please see "Prospect of Future Development" set out in the Annual Report 2019. By virtue of seizing opportunities and making full use of the capital market, the Company will fine tune its main business and operating strategy and actively increase the operating income and profits from relevant businesses in the upstream and downstream of hotel operation, in a bid to enhance the sustained profitability and comprehensive competitive strength of the listed company, promote its development and offer maximum protection to the interests of all shareholders, the minority shareholders in particular.
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Chapter 7 DISCUSSION AND ANALYSIS OF
BUSINESS CONDITION
Analysis of principal business prepared under the PRC GAAP
7.1 Overview
The Company has been primarily engaged in the R&D, design, production and sales businesses of products related to power transmission and transformation equipment in recent years. Our main products are enclosed busbars that are mainly applied to the power system field to enhance the transmission efficiency of power transmission lines and support the transmission of high power electric energy. Enclosed busbar plays an important role in the power system. Besides, Garden Lane Hotel, a holding subsidiary of the Company, actively expanded its hotel management, catering and accommodation businesses during the reporting period.
There was no material change in the principal business of the Company during the reporting period.
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7.2 Analysis of changes in major financial information
Unit: RMB | |||||
Increase/ | |||||
decrease | |||||
Amount for | Amount for | compared with | |||
the reporting | the same period | the same period | |||
period | of last year | of last year | Reason for increase/decrease | ||
Operating incomes | 37,838,750.59 | 45,163,758.53 | -16.22% | A decrease in the income of Garden | |
Lane Hotel due to the impact of the | |||||
epidemic | |||||
Operating costs | 26,403,071.53 | 21,417,642.83 | 23.28% | An increase in the cost of Fuxin Busbar | |
corresponding to an increase in the | |||||
income | |||||
Selling expenses | 14,515,293.80 | 17,393,737.95 | -16.55% | A decrease in the selling expense of | |
Garden Lane Hotel | |||||
Administrative expenses | 9,990,199.47 | 11,127,965.17 | -10.22% | Strict control over the administrative | |
expenses by the Company | |||||
Financial expenses | -171,294.11 | -908,599.98 | N/A | A decrease in the interests on deposits | |
Income tax expenses | 280,256.09 | 520,173.40 | -46.12% | A decrease in the profits of Garden | |
Lane Hotel | |||||
Net cash flow from operating | 61,702,699.13 | -2,091,919.29 | N/A | Maturity of time deposits | |
activities | |||||
Net cash flow from investing | -48,435,719.34 | -160,513.12 | N/A | Payment of the consideration for the | |
activities | acquisition of equity of Chongqing Hotel | ||||
LTD. | in the current period | ||||
Net cash flow from financing | -10,725,709.27 | -2,186,838.29 | N/A | Repayment of the principal of short-term | |
CO., | |||||
activities | borrowings and interests thereon in the | ||||
DEVELOPMENTELECTRICNORTHEAST | current period | ||||
Net increase of cash and | 2,575,299.44 | -4,438,175.88 | N/A | Combined effect of all the above factors | |
cash equivalents | |||||
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7.3 Main business composition
7.3.1 Composition of operating income
Unit: RMB | |||||
Increase/ | |||||
The reporting period | The same period of last year | decrease | |||
compared with | |||||
Percentage | Percentage | ||||
the same | |||||
of operating | of operating | period of last | |||
Amount | income | Amount | income | year | |
Total operating income | 37,838,750.59 | 100% | 45,163,758.53 | 100% | -16.22% |
By industry | |||||
Power transmission | |||||
and transformation | 26,700,933.95 | 70.57% | 16,259,273.32 | 36.00% | 64.22% |
Catering services | 11,137,816.64 | 29.43% | 28,904,485.21 | 64.00% | -61.47% |
By product | |||||
Enclosed busbars | 26,700,933.95 | 70.57% | 16,259,273.32 | 36.00% | 64.22% |
Catering services | 11,137,816.64 | 29.43% | 28,904,485.21 | 64.00% | -61.47% |
By region | |||||
Mainland China | 37,838,750.59 | 100.00% | 45,163,758.53 | 100.00% | -16.22% |
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7.3.2 Industry, product or region accounting for more than 10% of the operating income or profit of the Company
Unit: RMB | ||||||
Increase/ | ||||||
decrease in | Increase/ | Increase/ | ||||
operating | decrease in | decrease in | ||||
income | operating cost | gross margin | ||||
compared | compared | compared | ||||
with the same | with the same | with the same | ||||
Operating | period of | period of | period of | |||
income | Operating cost | Gross margin | last year | last year | last year | |
By industry | ||||||
Power transmission and | ||||||
transformation | 26,700,933.95 | 24,245,271.69 | 9.20% | 64.22% | 140.58% | -75.81% |
Catering services | 11,137,816.64 | 2,157,799.84 | 80.63% | -61.47% | -80.97% | 32.68% |
By product | ||||||
Enclosed busbars | 26,700,933.95 | 24,245,271.69 | 9.20% | 64.22% | 140.58% | -75.81% |
Catering services | 11,137,816.64 | 2,157,799.84 | 80.63% | -61.47% | -80.97% | 32.68% |
By region | ||||||
Mainland China | 37,838,750.59 | 26,403,071.53 | 30.22% | -16.22% | 23.28% | -42.52% |
Explanation on the increase/decrease of more than 30% compared with the same period of last year:
- The income of Fuxin Busbar increased in the first half of 2020 due to the increased output, and the costs increased correspondingly. The products sold in the current period are mainly products with low gross profits, resulting in lower gross margin.
- The income of Garden Lane decreased in the first half of 2020 due to the impact of the epidemic, along with a decrease in the cost. The gross margin increased due to a greater decrease in cost than in revenue.
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7.4 Significant changes in the composition of assets
Unit: RMB | ||||||
As at the end of | As at the end of | |||||
the reporting period | the same period of last year | |||||
As a percentage | As a percentage | |||||
of total assets | of total assets | Increase/ | ||||
Amount | (%) | Amount | (%) | decrease (%) | Explanation for significant change | |
Monetary fund | 81,839,967.09 | 17.24% | 140,874,668.42 | 26.06% | -8.82% | Payment of the consideration for the |
acquisition of 30% equity of | ||||||
Chongqing Hotel | ||||||
Account receivable | 32,219,606.85 | 6.79% | 30,517,139.65 | 5.64% | 1.15% | Increase along with the increase in |
the business of enclosed busbar | ||||||
products | ||||||
Inventories | 21,042,672.60 | 4.43% | 13,179,608.97 | 2.44% | 1.99% | Increase in production input by Fuxin |
Busbar during the period | ||||||
Fixed assets | 48,141,448.22 | 10.14% | 49,711,031.80 | 9.19% | 0.95% | Accumulated depreciation of fixed |
assets as normal | ||||||
7.5 Assets and liabilities at fair value
Unit: RMB | ||||||||
Gain/loss on | Cumulative | |||||||
Amount at the | changes in fair | changes in fair | Impairment for | |||||
beginning of the | value for the | value recorded in | the current | Purchase in the | Sale in the | Amount at the | ||
Item | period | current period | equity | period | current period | current period | Other changes | end of the period |
Financial assets | ||||||||
Other equity investments | 198,078,808.21 | 198,078,808.21 | ||||||
Total | 198,078,808.21 | 198,078,808.21 | ||||||
Financial liabilities | 0.00 | 0.00 | ||||||
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7.6 Restricted assets as at the end of the reporting period
Unit: RMB
Book value at the end | ||
Item | of the year | Reasons for restriction |
Monetary fund - other monetary funds | 3,236,900.00 | Performance guarantee |
Intangible assets - land use right | 12,210,281.05 | Mortgage loan |
Total | 15,447,181.05 | |
7.7 Disposal of major assets
During the reporting period, there is no disposal of major assets.
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7.8 Analysis of major controlling company and invested company
Unit: RMB | ||||||||
Principal | Registered | Operating | ||||||
Company name | Company type | business | capital | Total asset | Net asset | income | Operating profit | Net profit |
Northeast Electric | Subsidiary | Trading | USD20 million | 74,162,190.22 | 58,608,855.51 | 0 | -17,454.56 | -17,454.56 |
Development (HK) Co., Ltd. | ||||||||
Gaocai Technology Co., Ltd. | Subsidiary | Investment | USD1 | 87,259,821.14 | 5,131,730.31 | 0 | -9,782.86 | -9,782.86 |
Shenyang Kaiyi | Subsidiary | Manufacturing of | RMB1 million | 50,128,330.25 | -55,092,470.97 | 0 | -622,139.23 | -622,146.74 |
Electric Co., Ltd. | electrical | |||||||
equipment | ||||||||
Fuxin Enclosed Busbar | Subsidiary | Manufacturing of | USD8.5 million | 116,447,719.90 | -38,953,588.69 | 26,700,933.95 | -3,669,042.61 | -3,680,664.59 |
Co., Ltd. | enclosed busbars | |||||||
Hainan Garden Lane Flight | Subsidiary | Public space | RMB50 million | 362,012,372.75 | 199,488,400.86 | 11,137,816.64 | -5,858,727.70 | -5,051,021.55 |
Hotel Management Co., Ltd. | business | |||||||
Northeast Electric (Chengdu) | Subsidiary | Electric power | RMB10 million | 13,276,988.15 | 6,986,499.28 | 0 | -10,699.20 | -10,699.20 |
Electric Engineering Design | engineering | |||||||
Co., Ltd. | ||||||||
HNA Tianjin Center | Invested company | Property leasing, | RMB269,887,709 | 3,788,998,719.70 | 1,183,854,920.91 | 28,592,825.50 | -2,488,964.70 | -2,728,364.40 |
Development Co., Ltd. | hotel catering | |||||||
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NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
Analysis of the financial status of the Company in accordance with Appendix 16 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited
Share capital
During the reporting period, there is no change in the share capital of the Company.
Reserve
Details of the annual changes in the reserves of the Company and the Group are set out in the financial statements and the statement of changes in shareholders' equity.
Distributable reserve
As at 30 June 2020, according to the relevant regulations, the Company's distributable reserve is RMB-2,071,138,368.70. Pursuant to the resolution approved at the Board meeting on 28 August 2020, the Board proposes not to distribute cash dividend, issue bonus share, or capitalize from capital reserves during the year.
Analysis of loans and borrowings
The Group's short-term borrowings were nil, primarily because the secured loans borrowed from the Bank of China by our subsidiary Fuxin Busbar were settled.
Working capital and financial resources
The net cash generated from the Group's operating activities for the half year ended 30 June 2020 was approximately RMB61,703,000 (2019: net cash generated from operating activities of approximately RMB9,597,000).
As at 30 June 2020, the Group had bank deposits and cash (including pledged bank balances) of approximately RMB81,840,000 (2019: RMB135,275,000) and had no bank loans (2019: bank loans of RMB10,500,000).
As of 30 June 2020, the Group had current liabilities of RMB424,915,000, non-current liabilities of RMB112,101,000, and shareholders' deficit attributable to shareholders of the Company of RMB67,768,000. Details of the capital structure of the Group are set out in the financial report of the Company's interim report.
The Company's funding needs have no obvious seasonal patterns.
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Capital expenditure
The Group's funds can meet the capital requirements of the capital expenditure plan and daily operations.
Capital structure
The Company's sources of funds are mainly operating cash inflows and loans of substantial shareholders. As at 30 June 2020, the Group's short-term bank borrowings were nil, and the cash and cash equivalents were RMB81,840,000 (2019: RMB135,275,000). Borrowings bear fixed interest rates, and no hedging instruments are hedged.
The Group's policy is to manage its capital to ensure that the Group's entities are able to continue to operate while maximizing returns to shareholders by optimizing the ratio of liabilities and equity. The overall strategy of the Group has remained unchanged from previous years.
Prospects for new business
Details of the prospects for new business are set out in "Prospects for the second half of the year" of "Discussion and Analysis of Business Condition".
Significant investments held and the performance of such investments
Details of significant investments held and the performance of these investments are set out in "Analysis of Major Controlling Company and Invested Company" of "Discussion and Analysis of Business Condition".
Significant investments and sales
Details of significant investments and sales are set out in "Disposal of major assets" of "Discussion and Analysis of Business Condition".
Segmental information of results
Details of segmental information of results are set out in the "Main Business Composition" of "Discussion and Analysis of Business Condition".
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Assets pledge
As of 30 June 2020, the Company had fixed assets and net land value with a fair value of RMB12 million and the carrying amount of RMB12 million respectively for mortgages.
Plan for major investment or acquisition of capital assets in the future
As of the latest practicable date prior to the publication of this report, the Company has no relevant plans.
Gearing ratio
As of 30 June 2020, the Group's gearing ratio (calculated as total liabilities/total assets) was 113% (2019: 111%).
Risks of exchange rate fluctuation and any related hedges
The Group's assets and liabilities are denominated in Renminbi, so the risk of exchange rate changes has little impact on the Group. The Group has taken the following measures in reducing the risk of exchange rate fluctuations: (1) increase the export price of products to reduce the risk of exchange rate fluctuations; (2) agree with the other party in advance in case of large export contracts that the risks of exchange rate fluctuations shall be borne by both parties when the exchange rate fluctuation exceeds the limit of agreed scope; (3) strive to sign forward agreements with financial institutions to lock up exchange rates and avoid risks.
Contingent liabilities
As of 30 June 2020, the Company had no material contingent liabilities.
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Chapter 8 Significant Events
-
Personnel changes
Please refer to "Chapter 5 Profiles of Directors, Supervisors and Senior Management". - Staff of the Company and remuneration policy
As at 30 June 2020, the number of employees on the payroll of the Company was 158. The total salary of employees was RMB9.64 million in the first half of 2020 (the number of employees of the Group was 162 and the total salary of employees was RMB27,865,000 in 2019).
The remuneration of the employees of the Company includes their salaries, bonuses and other fringe benefits. The Company has different rates of remuneration for different employees, which are determined based on their performance, experience, position and other factors in compliance with the relevant PRC laws and regulations. - Corporate governance structure
At present, the actual corporate governance structure basically complies with the related requirements of securities regulators. - Profit distribution plan and its implementation
The Company proposes not to distribute cash dividend, issue bonus share, or capitalise from capital reserves. - Commitments performed during the reporting period and not yet performed as of the end of the reporting period by the de facto controller, shareholders, connected parties, acquirers of the Company and the Company
The Company did not have any commitments performed during the reporting period and not yet performed as of the end of the reporting period by the de facto controller, shareholders, connected parties, acquirers of the Company and the Company during the reporting period.
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8.6 Explanation given by the Board on the relevant situation of the "Non-standard Audit Report" of the previous year
NEE has engaged Mazars Certified Public Accountants LLP as the auditor of the Company for the year of 2019. Mazars Certified Public Accountants LLP issued an unqualified audit report for the Company's financial report for 2019 with paragraphs regarding material uncertainties on the Company's ability to continue as a going concern.
-
Matters relating to the audit opinion
NEE recorded accumulated net loss of RMB-2,059,319,937.47 and equity attributable to shareholders of the parent of RMB-56,590,261.98 at the end of 2019. As of 31 December 2019, NEE's current liabilities exceeded its current assets by RMB231,083,200.33. Meanwhile, the Company faced compensation of RMB272 million for resolved litigation cases. These matters indicate there are major uncertainties regarding the Company as a going concern, however, without any effect on the published audit opinions.
- Explanation given by the Board on the relevant situation of the "Non-standard Audit Report" of the previous year
The Board holds that the above audit opinion objectively and truthfully reflects the financial position of the Company and its risks as a going concern. In order to enhance the sustained development and profitability, improve the asset quality, promote the long-term and healthy development, and strive to remove the risk warning on delisting, the Company has taken the following measures to improve its ability to continue as a going concern:
- Beijing Haihongyuan Investment Management Co., Ltd. ("Beijing Haihongyuan"), the parent of the Group, has issued a letter of commitment of financial support, undertaking to provide financial support unconditionally for the Group for one year from the issuance date of the letter, including funds and guarantees to help supplement working funds of the Group.
- Further optimise the principal business through equity financing, actively seek opportunities for expanding new business segments, and enhance the Group's core competitiveness and sustainable development capabilities.
- Coping with the market changes and demands, proactively adjust product structure and industrial upgrading, accelerate the transformation to a modern service industry, and optimise overall industrial distribution; develop new client bases, improve and strengthen sales system, and enhance the profitability of the main business;
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- Research, explore and develop hotel, catering and accommodation businesses based on the wholly-owned subsidiary Hainan Garden Lane Flight Hotel Management Co., Ltd., and utilise the resources and talent advantages of the substantial shareholders in the modern service industry to launch new businesses and develop new industries, thereby expanding the business scope of the listed company, improving its asset portfolio, and bringing fresh energy into its sustained operation.
- Enhance overall budget management and cost control, exert strict control over various expenditures and expenses, lower the operation costs, and maximise the profitability of the principal business.
- In strict accordance with the requirements for standard operation of listed companies, the Group continuously improves working standards and perfects the internal control system, establishes and improves the operation organisation, continuously improves various internal control systems, strengthens risk control measures, and reduces the Company's operational risks, so as to enable the Group's internal control system to be more operable, to prevent damage to the interests of the listed company and shareholders, and to ensure the realisation of the Group's business objectives.
With the aforesaid measures, the management of the Group deems it reasonable to prepare the financial statements on the basis of continuous operations. The Board of the Group has conducted a thorough and detailed evaluation on the Group's ability to continue as a going concern by reviewing the future working capital forecast of the Group prepared by the management, and deems that the Group will be able to acquire enough funding resources to ensure working capital and expensing needs. Therefore, the Board agreed with the preparation of the financial statements on the basis of continuous operations.
The Board will continue to pay attention to and supervise the management of the Company so that they actively take effective measures to improve the Company's ability to continue as a going concern and protect the legitimate rights and interests of the Company and investors.
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8.7 Litigation
-
Tiexi District State-owned Assets Supervision and Administration Bureau of Shenyang vs. the Company for the payment of allowance for staff
Please refer to "6.2 Business Review for the First Half of 2020 - (V) Progress of material litigations". - Legal proceedings involving the subsidiary Fuxin Enclosed Busbar Co., Ltd.
Please refer to "6.2 Business Review for the First Half of 2020 - (V) Progress of material litigations". - The litigation brought by China Development Bank
The Supreme People's Court issued an enforcement order ((2017) Zui Gao Fa Zhi Fu No.27) in August 2017 to reject the reconsideration request made by NEE and affirm the enforcement order of Beijing Higher People's Court (2015) Gao Zhi Yi Zi No.52. The enforcement order was final. The case was transferred to Hainan First Intermediate People's Court on 21 June 2019. The ruling of the case is being implemented and no actual performance has been carried out. - The litigation on the application made by Fushun Electric Porcelain Manufacturing Co., Ltd. (the "Fushun Electric Porcelain") for adjudicating NEE as a person subject to enforcement
The Company received the Notice of Appearance [(2019) Qiong 96 Min Chu No.381] on adjudicating NEE as a person subject to enforcement by Fushun Electric Porcelain, the bill of indictment, and other related litigation materials served by the First Intermediate People's Court of Hainan Province on 16 July 2019. At present, relevant departments are preparing for relevant evidence to actively respond to the litigation. As the lawsuit has not yet been heard and the final judgment of the court has not been reached, so the negative impact on the Company's current profits or subsequent profits cannot be determined for the time being. For more details, please refer to the announcement dated 23 July 2019.
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8.8 Integrity of the Company, its controlling shareholders and de facto controller
The de facto controller of the Company is Hainan Liberation Commonweal Foundation. Through verifying the information published on CREDITCHINA.GOV.CN, the National Enterprise Credit Information Publicity System, and http://zxgk.court.gov.cn/, Hainan Liberation Commonweal Foundation, the de facto controller of the Company, has not been included in the List of Enterprises with Abnormal Business Operation, the list (blacklist) of or dishonest enterprises in material non-compliance with the laws or the list of persons subject to enforcement due to dishonesty.
Hainan Liberation Commonweal Foundation, the de facto controller of the Company, has not carried out external financing activities and has no behavior of dishonesty or breach of contract on debts.
- Material connected transactions
- There are no material connected transactions in the Company during the reporting period.
- The subsidiary Garden Lane Hotel's acquisition of 30% equity interests in Chongqing Hotel constituted a connected transaction. Please refer to "(II) Acquisition of minority interests in Chongqing Hotel - 6.2 Business Review for the First Half of 2020".
-
Controlling shareholders and their connected parties' use of capital of the listed company for non-operating purposes
Controlling shareholders and their connected parties did not use any capital of the listed company for non-operating purposes during the reporting period. - Significant contracts and their execution
During the reporting period, the Company did not enter into any material trust, contracting or lease arrangement. - Guarantees
As at the end of the reporting period, the actual balance of the external guarantee provided by the Company totaled RMB30 million, with Jinzhou Power Capacitors Co., Ltd. as the collateral.
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
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ANNOUNCEMENT OF INTERIM RESULTS 2020
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
-
Corporate governance
During the reporting period, the listed issuer strictly complied with the code provisions of Corporate Governance Code as set out in Appendix 14 and had no deviations from the code provisions, except for the following deviations:
Code Provision A.2.1 stipulates that the roles of chairman and chief executive should be separate and should not be performed by the same individual. Due to the resignation of Mr. Li Rui, the former general manager of the Company, Mr. Zhu Jie, the Chairman, is acting as the general manager now.
For more details on the implementation, please refer to the Corporate Governance Report disclosed in the Annual Report 2019. After the issuance of the annual report, the compliance and execution of the Code by the listed issuer remained unchanged. - Model Code for Securities Transactions by Directors
The Company takes the Model Code for Securities Transactions by Directors of Listed Issuers (the "Model Code") under the Listing Rules of Hong Kong Stock Exchange as a code of conduct for Directors' securities transactions; after accepting specific inquiries, all members of the Board of the Company confirmed that they had complied with the Model Code during their tenure as the Directors.
The Board has formulated guidelines on the trading of securities of listed companies by "directors and relevant employees". The Office of the Board has given written notices in advance to insiders (including the Company's Directors, supervisors, senior management, controlling shareholders, de facto controllers and their connected parties, as defined in the Listing Rules) stating that purchase and sales of shares of the Company shall comply with relevant regulations and forbidding the insiders to purchase or sell the shares with inside information: no transactions of the Company's securities shall be carried out during the price-sensitive timeframe within 30 days, a lock-up period from 28 July 2020 to 28 August 2020, prior to the results announcement.
All Directors confirmed that: During the reporting period, they had adhered to the guidelines, and neither they nor their connected parties conducted securities transactions of the Company.
The Company has complied with Rules 3.10(1), 3.10(2) and 3.10A of the Listing Rules relating to the appointment of a sufficient number of independent non-executive Directors and at least one independent non-executive Director with appropriate professional qualifications or accounting or related financial management expertise. The Company has appointed three independent non-executive Directors including one with financial management expertise, of whom the biographical details are set out in the Annual Report 2019 of the Company.
The Company has been in place an audit committee under the Board in accordance with Rule 3.21 of the Listing Rules.
34
ANNOUNCEMENT OF INTERIM RESULTS 2020
8.15 Others
Purchase, sale or redemption of shares
During the reporting period, the Company and its subsidiaries did not purchase, sell and redeem any shares of the Company.
Loans to an entity
At the end of the reporting period, neither the Company nor its subsidiaries have granted loans to any entity.
Pledge of shares by controlling shareholder
At the end of the reporting period, the controlling shareholder of the Company did not pledge all or part of its equities in the Company to guarantee the Company's debts or warranty.
Terms included in the loan agreements under which the controlling shareholder shall fulfil specific responsibilities
At the end of the reporting period, the Company and its subsidiaries did not encounter any situation where the controlling shareholder should fulfil specific responsibilities according to the terms included in the loan agreements.
Breach of loan agreements
At the end of the reporting period, the Company and its subsidiaries did not have any breach of loan agreements.
Provision of financial assistance and guarantee to affiliates
At the end of the reporting period, the Company and its subsidiaries did not provide any financial assistance and guarantee to affiliates.
Share option scheme
During the reporting period, the Company and its subsidiaries did not have any share option scheme.
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
35
ANNOUNCEMENT OF INTERIM RESULTS 2020
Directors, supervisors and chief executive's interests in the shares, underlying shares and debentures of the Company
For details of Directors, supervisors and chief executives' interests in the shares, underlying shares and debentures of the Company, please see "Equity interest of Directors, supervisors and senior management" under "Profiles of Directors, Supervisors and Senior Management".
Audit of interim results
The unaudited results for the six months ended 30 June 2020 were prepared by the Group in accordance with the PRC GAAP and IFRS.
The audit committee under the Board of the Company has reviewed and confirmed the interim results announcement of the Company for 2020.
The audit committee has approved the financial accounting principles, standards and methods adopted by the Company for the unaudited interim accounts for the six months ended 30 June 2020.
8.16 Subsequent events
None
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
36
ANNOUNCEMENT OF INTERIM RESULTS 2020
Chapter 9 F I N A N C I A L S T A T E M E N T S (PREPARED UNDER THE IFRS)
Condensed Consolidated Statement of Comprehensive Income
For the six months ended 30 June 2020
Six months ended 30 June | ||
2020 | 2019 | |
(Unaudited) | (Unaudited) | |
RMB'000 | RMB'000 | |
Revenue | 37,839 | 45,164 |
Cost of sales and services | (26,403) | (21,418) |
Gross profit | 11,436 | (23,746) |
Other revenue and other income | 2,779 | 1,859 |
Selling expenses | (14,515) | (17,394) |
Administrative and other operating expenses | (10,433) | (11,740) |
Gain on disposal of subsidiaries | - | - |
Gain on disposal of a plant | - | - |
Reversal (Provision) of loss allowance on | ||
- trade and rental receivables | - | - |
- other receivables | - | 831 |
Finance costs | (861) | (691) |
Share of results of an associate | - | - |
Loss before taxation | (11,594) | (3,389) |
Income tax expenses | (280) | (520) |
Loss for the period | (11,874) | (3,909) |
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
37
ANNOUNCEMENT OF INTERIM RESULTS 2020
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
Condensed Consolidated Statement of Comprehensive Income (continued)
For the six months ended 30 June 2020
Six months ended 30 June
2020 | 2019 | |
(Unaudited) | (Unaudited) | |
RMB'000 | RMB'000 | |
Other comprehensive income | ||
Items that are reclassified or may be reclassified subsequently to | ||
profit or loss | ||
Exchange difference on translation of foreign operations | 111 | 346 |
Other comprehensive income for the period, net of tax | 111 | 346 |
Total comprehensive loss for the period | (11,763) | (3,563) |
Loss for the period attributable to: | ||
Equity holders of the Company | (11,818) | (3,924) |
Non-controlling interests | (56) | 15 |
Loss for the period | (11,874) | (3,909) |
Total comprehensive loss for the period attributable to: | ||
Equity holders of the Company | (11,707) | (3,578) |
Non-controlling interests | (56) | 15 |
Total comprehensive loss for the period | (11,763) | (3,563) |
Loss per share | RMB cents | RMB cents |
Basic and diluted | (1.35) | (0.45) |
38
ANNOUNCEMENT OF INTERIM RESULTS 2020
Condensed Consolidated Statement of Financial Position
As at 30 June 2020
As at | As at | |
30 June 2020 | 31 December 2019 | |
(Unaudited) | (Audited) | |
RMB'000 | RMB'000 | |
Non-current assets | ||
Property, plant and equipment | 48,141 | 49,843 |
Investment properties | 14,600 | 16,012 |
Right-of-use assets | 6,491 | 9,737 |
Land use right | 14,499 | 14,675 |
Intangible assets | - | - |
Goodwill | - | - |
Interest in an associate | - | - |
Designated FVOCI | 198,079 | 198,079 |
Deposits | 4,840 | 4,840 |
286,650 | 293,186 | |
Current assets | ||
Inventories | 21,043 | 16,910 |
Trade, bills and rental receivables | 32,397 | 27,113 |
Prepayment, deposits and other receivables | 50,083 | 4,774 |
Tax recoverable | 2,662 | 129 |
Cash at a financial institution | 72,425 | 70,574 |
Cash at banks and in hand | 9,415 | 64,701 |
188,025 | 184,201 | |
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
39
ANNOUNCEMENT OF INTERIM RESULTS 2020
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
Condensed Consolidated Statement of Financial Position (continued)
As at 30 June 2020
As at | As at | |
30 June 2020 | 31 December 2019 | |
(Unaudited) | (Audited) | |
RMB'000 | RMB'000 | |
Current liabilities | ||
Trade payables | 29,987 | 17,926 |
Contract liabilities | 6,522 | 10,241 |
Other payables | 375,067 | 362,786 |
Employment benefits payables | 3,403 | 3,276 |
Tax payables | 835 | 742 |
Interest-bearing borrowings | - | 10,500 |
Lease liabilities | 9,100 | 9,813 |
424,914 | 415,284 | |
Net current liabilities | (236,889) | (231,083) |
Total assets less current liabilities | 49,761 | 62,103 |
Non-current liabilities | ||
Provisions | 72,100 | 72,100 |
Government grants | 27,145 | 23,623 |
Lease liabilities | 12,856 | 17,487 |
112,101 | 113,210 | |
NET LIABILITIES | (62,340) | (51,107) |
Capital and reserves | ||
Share capital | 873,370 | 873,370 |
Reserves | (941,138) | (929,960) |
Equity attributable to equity holders of the Company | (67,768) | (56,590) |
Non-controlling interests | 5,428 | 5,483 |
TOTAL DEFICITS | (62,340) | (51,107) |
40
ANNOUNCEMENT OF INTERIM RESULTS 2020
Condensed Consolidated Statement of Changes in Equity
For the six months ended 30 June 2020
Equity attributable to equity holders of the Company | ||||||||||
Reserves | ||||||||||
Investment | ||||||||||
revaluation | Non- | |||||||||
Share | Capital | Surplus | reserve | Exchange | Accumulated | controlling | Total | |||
capital | reserve | reserve | (non-recycling) | reserve | losses | Total reserves | Sub-total | interests | equity | |
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |
RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | |
As at 1 January 2020 | 873,370 | 1,082,848 | 108,587 | (35,096) | (26,979) | (2,059,320) | (929,960) | (56,590) | 5,483 | (51,107) |
Loss for the period | - | - | - | - | - | (11,818) | (11,818) | (11,818) | (55) | (11,873) |
Other comprehensive income | ||||||||||
Exchange differences on translation of | ||||||||||
foreign operations | - | - | - | - | 111 | - | 111 | 111 | - | 111 |
Total other comprehensive income | ||||||||||
for the period | - | - | - | - | 111 | - | 111 | 111 | - | 111 |
Total comprehensive loss for the | ||||||||||
period | - | - | - | - | 111 | (11,818) | (11,707) | (11,707) | (55) | (11,762) |
Transactions with equity holders of the | ||||||||||
Company | ||||||||||
Contributions and distributions: | ||||||||||
Changes in ownership interests | - | 529 | - | - | - | - | 529 | 529 | - | 529 |
As at 30 June 2020 (unaudited) | 873,370 | 1,083,377 | 108,587 | (35,096) | (26,868) | (2,071,138) | (941,138) | (67,768) | 5,428 | (62,340) |
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
41
ANNOUNCEMENT OF INTERIM RESULTS 2020
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
Condensed Consolidated Statement of Changes in Equity (continued)
For the six months ended 30 June 2020
Equity attributable to equity holders of the Company | ||||||||||
Reserves | ||||||||||
Investment | ||||||||||
revaluation | Non- | |||||||||
Share | Capital | Surplus | reserve | Exchange | Accumulated | controlling | Total | |||
capital | reserve | reserve | (non-recycling) | reserve | losses | Total reserves | Sub-total | interests | equity | |
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |
RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | |
As at 1 January 2019 | 873,370 | 1,074,828 | 108,587 | (2,206) | (26,806) | (2,019,154) | (864,751) | 8,619 | 13,497 | 22,116 |
Loss for the period | - | - | - | - | - | (3,924) | (3,924) | (3,924) | 16 | (3,908) |
Other comprehensive income | ||||||||||
Exchange differences on translation of | ||||||||||
foreign operations | - | - | - | - | 346 | - | 346 | 346 | - | 346 |
Total other comprehensive income | ||||||||||
for the period | - | - | - | - | 346 | - | 346 | 346 | - | 346 |
Total comprehensive loss for the | ||||||||||
period | - | - | - | - | 346 | (3,924) | (3,578) | (3,578) | 16 | (3,562) |
Transactions with equity holders of | ||||||||||
the Company | ||||||||||
Contributions and distributions: | ||||||||||
Changes in ownership interests in | ||||||||||
subsidiaries that do not result in | ||||||||||
a loss of control | - | 8,015 | - | - | - | - | 8,015 | 8,015 | (8,015) | - |
As at 30 June 2019 (unaudited) | 873,370 | 1,082,843 | 108,587 | (2,206) | (26,460) | (2,023,078) | (860,314) | 13,056 | 5,498 | 18,554 |
42
ANNOUNCEMENT OF INTERIM RESULTS 2020
Condensed Consolidated Cash Flow Statement
For the six months ended 30 June 2020
Six months ended 30 June | ||||
2020 | 2019 | |||
(Unaudited) | (Unaudited) | |||
RMB'000 | RMB'000 | |||
OPERATING ACTIVITIES | ||||
Cash generated from (used in) operations | 4,885 | (2,037) | ||
Income taxes paid | (1,025) | (1,217) | ||
Interest received | 992 | - | ||
Net cash generated from (used in) operating activities | 4,852 | (3,254) | ||
Purchase of property, plant and equipment | - | (161) | ||
Cash paid for investments | (48,436) | - | ||
Net cash used in investing activities | (48,436) | (161) | ||
FINANCING ACTIVITIES | ||||
Repayment of bank and other loans | (10,500) | - | ||
Repayment of lease liabilities | - | (2,055) | ||
Interest paid | (226) | (131) | ||
Net cash used in financing activities | (10,726) | (2,186) | ||
Net decrease in cash and cash equivalents | (54,310) | (5,601) | ||
Cash and cash equivalents at the beginning of the reporting period | 58,954 | 69,518 | ||
Effect on exchange rate changes on cash and cash equivalents | 34 | 1 | ||
LTD. | ||||
Cash and cash equivalents at the end of the reporting period, | ||||
represented by bank balances and cash | 4,678 | 63,918 | ||
NORTHEAST ELECTRIC DEVELOPMENT CO., | ||||
43 | ||||
ANNOUNCEMENT OF INTERIM RESULTS 2020
Chapter 10 F I N A N C I A L S T A T E M E N T S (PREPARED UNDER THE PRC GAAP)
-
AUDIT REPORT
Has the interim report been audited?
□ Yes √ No
The interim report of the Company has not been audited.
-
FINANCIAL STATEMENTS
Unit in the financial statements of the notes to financial statements: RMB
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
44
ANNOUNCEMENT OF INTERIM RESULTS 2020
1. CONSOLIDATED BALANCE SHEET
Prepared by: NORTHEAST ELECTRIC DEVELOPMENT CO., LTD. 30 June 2020
Unit: RMB | ||||
Items | 30 June 2020 | 31 December 2019 | ||
Current assets: | ||||
Cash and cash equivalents | 81,839,967.09 | 135,274,303.72 | ||
Reserved deposits | ||||
Loans to banks and other financial institutions | ||||
Financial assets held for trading | ||||
Derivative financial assets | ||||
Notes receivable | 177,692.20 | |||
Accounts receivable | 32,219,606.85 | 27,140,493.40 | ||
Receivables financing | ||||
Prepayment | 265,294.42 | 1,019,555.51 | ||
Premiums receivable | ||||
Reinsurance accounts receivable | ||||
Reinsurance contract reserves receivable | ||||
Other receivables | 49,817,907.41 | 759,602.00 | LTD. | |
Incl.: Interest receivable | ||||
NORTHEAST ELECTRIC DEVELOPMENT CO., | ||||
Dividends receivable | ||||
45 | ||||
ANNOUNCEMENT OF INTERIM RESULTS 2020
1. CONSOLIDATED BALANCE SHEET (Continued)
Prepared by: NORTHEAST ELECTRIC DEVELOPMENT CO., LTD. 30 June 2020
Unit: RMB | |||
Items | 30 June 2020 | 31 December 2019 | |
Financial assets purchased under agreements to resell | |||
Inventories | 21,042,672.60 | 16,909,715.61 | |
Contract assets | |||
Assets held for sale | |||
Non-current asset due within 1 year | |||
Other current assets | 2,662,339.32 | 2,751,718.63 | |
Total current assets | 188,025,479.89 | 183,855,388.87 | |
Non-current assets: | |||
Loans and advances | |||
Debt investments | |||
Other debt investments | |||
Long-term receivables | |||
Long-term equity investments | |||
LTD. | Other equity instrument investments | 198,078,808.21 | 198,078,808.21 |
Other non-current financial assets | |||
CO., | |||
Investment real estate | |||
DEVELOPMENTELECTRICNORTHEAST | |||
Fixed assets | 48,141,448.22 | 49,802,006.47 | |
46
ANNOUNCEMENT OF INTERIM RESULTS 2020
1. CONSOLIDATED BALANCE SHEET (Continued)
Prepared by: NORTHEAST ELECTRIC DEVELOPMENT CO., LTD. 30 June 2020
Unit: RMB | ||
Items | 30 June 2020 | 31 December 2019 |
Construction in progress | ||
Bearer biological assets | ||
Oil and gas assets | ||
Right-of-use assets | 21,090,852.30 | 25,749,336.93 |
Intangible assets | 14,498,524.39 | 14,675,394.97 |
Development expenditures | ||
Goodwill | ||
Long-term deferred expenses | 40,728.78 | |
Deferred income tax assets | ||
Other non-current assets | 4,839,800.00 | 4,839,800.00 |
Total non-current assets | 286,649,433.12 | 293,186,075.36 |
Total assets | 474,674,913.01 | 477,041,464.23 |
Current liabilities: | ||
Short-term borrowings | 10,500,000.00 | |
Borrowings from central bank | ||
Borrowings from banks and other financial institutions | ||
Financial liabilities held for trading | ||
Derivative financial liabilities | ||
Notes payable | ||
Accounts payable | 29,987,363.52 | 18,436,024.06 |
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
47
ANNOUNCEMENT OF INTERIM RESULTS 2020
1. CONSOLIDATED BALANCE SHEET (Continued)
Prepared by: NORTHEAST ELECTRIC DEVELOPMENT CO., LTD. 30 June 2020
Unit: RMB | |||
Items | 30 June 2020 | 31 December 2019 | |
Receipts in advance | |||
Contract liabilities | 6,522,273.11 | 10,233,056.45 | |
Proceeds from sale of repurchased financial assets | |||
Deposits from customers and interbank | |||
Deposit for agency security transaction | |||
Deposit for agency security underwriting | |||
Employee compensation payable | 3,403,100.41 | 3,275,574.02 | |
Taxes payable | 834,859.59 | 1,346,933.20 | |
Other payables | 375,066,974.14 | 362,381,183.75 | |
Incl.: Interest payable | 17,363.75 | ||
Dividends payable | |||
Fees and commissions payable | |||
Reinsurance accounts payable | |||
LTD. | Liabilities held for sale | ||
Non-current liabilities due within 1 year | 9,100,084.26 | 8,765,817.72 | |
CO., | |||
Other current liabilities | |||
DEVELOPMENTELECTRICNORTHEAST | |||
Total current liabilities | 424,914,655.03 | 414,938,589.20 | |
48
ANNOUNCEMENT OF INTERIM RESULTS 2020
1. CONSOLIDATED BALANCE SHEET (Continued)
Prepared by: NORTHEAST ELECTRIC DEVELOPMENT CO., LTD. 30 June 2020
Unit: RMB | ||||
Items | 30 June 2020 | 31 December 2019 | ||
Non-current liabilities: | ||||
Provision for insurance contracts | ||||
Long-term borrowings | ||||
Bonds payable | ||||
Incl.: Preferred shares | ||||
Perpetual bonds | ||||
Lease liabilities | 12,856,485.87 | 17,486,748.75 | ||
Long-term payables | ||||
Long-term employee compensation payable | ||||
Estimated liabilities | 72,099,690.00 | 72,099,690.00 | ||
Deferred revenue | 27,144,948.32 | 23,623,291.13 | ||
Deferred income tax liabilities | ||||
Other non-current liabilities | ||||
Total non-current liabilities | 112,101,124.19 | 113,209,729.88 | NORTHEAST ELECTRIC DEVELOPMENT CO., LTD. | |
Total liabilities | 537,015,779.22 | 528,148,319.08 | ||
49 | ||||
ANNOUNCEMENT OF INTERIM RESULTS 2020
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
1. CONSOLIDATED BALANCE SHEET (Continued)
Prepared by: NORTHEAST ELECTRIC DEVELOPMENT CO., LTD. 30 June 2020
Unit: RMB | ||
Items | 30 June 2020 | 31 December 2019 |
Owners' equity: | ||
Share capital | 873,370,000.00 | 873,370,000.00 |
Other equity instruments | ||
Incl.: Preferred shares | ||
Perpetual bonds | ||
Capital reserve | 1,083,377,417.59 | 1,082,848,805.11 |
Less: Treasury stock | ||
Other comprehensive income | -61,964,639.24 | -62,076,254.02 |
Special reserve | ||
Surplus reserve | 108,587,124.40 | 108,587,124.40 |
Provision for general risk | ||
Retained profits | -2,071,138,368.70 | -2,059,319,937.47 |
Total equity attributable to owners of the parent company | -67,768,465.95 | -56,590,261.98 |
Minority interests | 5,427,599.74 | 5,483,407.13 |
Total owners' equity | -62,340,866.21 | -51,106,854.85 |
Total liabilities and owners' equity | 474,674,913.01 | 477,041,464.23 |
Legal representative: Zhu Jie | Chief financial officer: Wang Kai | Chief accounting officer: Wang Kai |
50
ANNOUNCEMENT OF INTERIM RESULTS 2020
2. BALANCE SHEET OF PARENT COMPANY
Unit: RMB | ||
Items | 30 June 2020 | 31 December 2019 |
Current assets: | ||
Cash and cash equivalents | 4,164.92 | 893.51 |
Financial assets held for trading | ||
Derivative financial assets | ||
Notes receivable | ||
Accounts receivable | ||
Receivables financing | ||
Prepayment | ||
Other receivables | 255,373,741.54 | 258,324,138.60 |
Incl.: Interest receivable | ||
Dividend receivable | ||
Inventories | ||
Contract assets | ||
Assets held for sale | ||
Non-current asset due within 1 year | ||
Other current assets | 608,094.92 | 566,304.82 |
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
51
ANNOUNCEMENT OF INTERIM RESULTS 2020
2. BALANCE SHEET OF PARENT COMPANY (Continued)
Unit: RMB | |||
Items | 30 June 2020 | 31 December 2019 | |
Total current assets | 255,986,001.38 | 258,891,336.93 | |
Non-current assets: | |||
Debt investments | |||
Other debt investments | |||
Long-term receivables | |||
Long-term equity investments | 56,436,473.03 | 56,436,473.03 | |
Other equity instrument investments | |||
Other non-current financial assets | |||
Investment real estate | |||
Fixed assets | 24,281.98 | 25,826.92 | |
Construction in progress | |||
Bearer biological assets | |||
Oil and gas assets | |||
Right-of-use assets | |||
Intangible assets | |||
Development expenditures | |||
LTD. | |||
Goodwill | |||
Long-term deferred expenses | 40,728.78 | ||
CO., | |||
Deferred income tax assets | |||
DEVELOPMENTELECTRICNORTHEAST | |||
Other non-current assets | |||
Total non-current assets | 56,460,755.01 | 56,503,028.73 | |
Total assets | 312,446,756.39 | 315,394,365.66 | |
52
ANNOUNCEMENT OF INTERIM RESULTS 2020
2. BALANCE SHEET OF PARENT COMPANY (Continued)
Unit: RMB | ||||
Items | 30 June 2020 | 31 December 2019 | ||
Current liabilities: | ||||
Short-term borrowings | ||||
Financial liabilities held for trading | ||||
Derivative financial liabilities | ||||
Notes payable | ||||
Accounts payable | ||||
Advances from customers | ||||
Contract liabilities | 581,743.59 | 581,743.59 | ||
Employee compensation payable | 1,010,964.10 | 1,059,047.18 | ||
Taxes payable | 302,287.21 | 339,467.85 | ||
Other payables | 336,165,905.80 | 337,074,394.71 | ||
Incl.: Interest payable | ||||
Dividends payable | ||||
Liabilities held for sale | ||||
Non-current liabilities due within 1 year | ||||
Other current liabilities | ||||
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD. | ||||
Total current liabilities | 338,060,900.70 | 339,054,653.33 | ||
53 | ||||
ANNOUNCEMENT OF INTERIM RESULTS 2020
2. BALANCE SHEET OF PARENT COMPANY (Continued)
Unit: RMB | ||
Items | 30 June 2020 | 31 December 2019 |
Non-current liabilities: | ||
Long-term borrowings | ||
Bonds payable | ||
Incl.: Preferred shares | ||
Perpetual bonds | ||
Lease liabilities | ||
Long-term payables | ||
Long-term employee compensation payable | ||
Estimated liabilities | 72,099,690.00 | 72,099,690.00 |
Deferred revenue | ||
Deferred income tax liabilities | ||
Other non-current liabilities | ||
Total non-current liabilities | 72,099,690.00 | 72,099,690.00 |
Total liabilities | 410,160,590.70 | 411,154,343.33 |
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
54
ANNOUNCEMENT OF INTERIM RESULTS 2020
2. BALANCE SHEET OF PARENT COMPANY (Continued)
Unit: RMB | ||
Items | 30 June 2020 | 31 December 2019 |
Owners' equity: | ||
Share capital | 873,370,000.00 | 873,370,000.00 |
Other equity instruments | ||
Incl.: Preferred shares | ||
Perpetual bonds | ||
Capital reserve | 996,249,779.94 | 995,721,167.46 |
Less: Treasury stock | ||
Other comprehensive income | ||
Special reserve | ||
Surplus reserve | 108,587,124.40 | 108,587,124.40 |
Retained profits | -2,075,920,738.65 | -2,073,438,269.53 |
Total owners' equity | -97,713,834.31 | -95,759,977.67 |
Total liabilities and owners' equity | 312,446,756.39 | 315,394,365.66 |
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
55
ANNOUNCEMENT OF INTERIM RESULTS 2020
3. CONSOLIDATED INCOME STATEMENT
Unit: RMB | ||||
Amount for | Amount for | |||
Items | the first half of 2020 | the first half of 2019 | ||
I. | Total operating income | 37,838,750.59 | 45,163,758.53 | |
Incl.: Operating income | 37,838,750.59 | 45,163,758.53 | ||
Interest income | ||||
Premiums earned | ||||
Fee and commission income | ||||
II. | Total operating cost | 51,178,021.60 | 49,613,580.90 | |
Incl.: Operating cost | 26,403,071.53 | 21,417,642.83 | ||
Interest expense | ||||
Fee and commission expense | ||||
Surrender value | ||||
Net payment of insurance claims | ||||
Net provision of insurance reserve | ||||
Premium bonus expenditures | ||||
Reinsurance expenses | ||||
Taxes & surcharges | 440,750.91 | 582,834.93 | ||
LTD. | Cost of sales | 14,515,293.80 | 17,393,737.95 | |
Administrative expenses | 9,990,199.47 | 11,127,965.17 | ||
CO., | ||||
Research and development expenses | ||||
DEVELOPMENTELECTRICNORTHEAST | ||||
Financial expenses | -171,294.11 | -908,599.98 | ||
Incl.: Interest expenses | 824,460.43 | 632,355.00 | ||
Interest income | 1,031,574.82 | 1,600,318.15 | ||
56
ANNOUNCEMENT OF INTERIM RESULTS 2020
3. CONSOLIDATED INCOME STATEMENT (Continued)
Unit: RMB | ||||
Amount for | Amount for | |||
Items | the first half of 2020 | the first half of 2019 | ||
Add: Other income | 668,955.66 | 243,907.98 | ||
Investment income ("-" represents loss) | ||||
Incl.: Investment income from associates and joint | ||||
ventures | ||||
Income from derecognition of financial assets at | ||||
amortised cost ("-" represents loss) | ||||
Foreign exchange gains ("-" represents loss) | ||||
Net exposure hedge income ("-" represents loss) | ||||
Gains on the changes in fair value ("-" represents loss) | ||||
Credit impairment loss ("-" represents loss) | 830,784.80 | |||
Loss on asset impairment ("-" represents loss) | ||||
Gain on disposal of assets ("-" represents loss) | ||||
III. Operational profit ("-" represents loss) | -12,670,315.35 | -3,375,129.59 | ||
Add: Non-operating income | 1,078,350.37 | 15,943.26 | ||
Less: Non-operating expenses | 2,017.55 | 29,365.81 | ||
IV. Total profit ("-" represents total loss) | -11,593,982.53 | -3,388,552.14 | ||
Less: Income tax expenses | 280,256.09 | 520,173.40 | NORTHEAST ELECTRIC DEVELOPMENT CO., LTD. | |
57 | ||||
ANNOUNCEMENT OF INTERIM RESULTS 2020
3. CONSOLIDATED INCOME STATEMENT (Continued)
Unit: RMB | ||||
Amount for | Amount for | |||
Items | the first half of 2020 | the first half of 2019 | ||
V. Net profit ("-" represents net loss) | -11,874,238.62 | -3,908,725.54 | ||
A. Classified by business continuity | ||||
1. | Net profit from continuing operations | |||
("-" represents net loss) | -11,874,238.62 | -3,908,725.54 | ||
2. | Net profit from discontinued operations | |||
("-" represents net loss) | ||||
B. Classified by ownership | ||||
1. | Net profit attributable to owners of the parent company | -11,818,431.23 | -3,924,330.74 | |
2. | Profit or loss attributable to minority interests | -55,807.39 | 15,605.20 | |
VI. Net other comprehensive income after tax | 111,614.78 | 346,094.29 | ||
Net other comprehensive income attributable to owners of the | ||||
parent company after tax | 111,614.78 | 346,094.29 | ||
A. Other comprehensive income not reclassifiable | ||||
to profit or loss | ||||
1. | Remeasurement of changes in defined benefit plans | |||
2. | Other comprehensive income not reclassifiable to profit or | |||
loss under the equity method | ||||
LTD. | 3. | Changes in fair value of other equity instruments | ||
investment | ||||
CO., | ||||
4. | Changes in the fair value of the Company's own credit risk | |||
DEVELOPMENTELECTRICNORTHEAST | ||||
5. | Others | |||
58
ANNOUNCEMENT OF INTERIM RESULTS 2020
3. CONSOLIDATED INCOME STATEMENT (Continued)
Unit: RMB | |||||
Amount for | Amount for | ||||
Items | the first half of 2020 | the first half of 2019 | |||
B. Other comprehensive income reclassifiable to profit or loss | 111,614.78 | 346,094.29 | |||
1. | Other comprehensive income reclassifiable to profit and | ||||
loss under the equity method | |||||
2. | Changes in the fair value of other debt investments | ||||
3. | Amount of financial assets reclassified into other | ||||
comprehensive income | |||||
4. | Credit impairment provisions for other debt investments | ||||
5. | Cash flow hedge reserve | ||||
6. | Exchange difference on translation of foreign financial | ||||
statements | 111,614.78 | 346,094.29 | |||
7. | Others | ||||
Net other comprehensive income attributable to minority | |||||
interests after tax | |||||
VII. Total comprehensive income | -11,762,623.84 | -3,562,631.25 | |||
Total comprehensive income attributable to owners of the | |||||
parent company | -11,706,816.45 | -3,578,236.45 | |||
Total comprehensive income attributable to minority interests | -55,807.39 | 15,605.20 | |||
VIII. Earnings per share | LTD. | ||||
(I) Basic earnings per share | -0.0135 | -0.0045 | |||
CO., | |||||
(II) Diluted earnings per share | -0.0135 | -0.0045 | |||
NORTHEAST ELECTRIC DEVELOPMENT | |||||
59 | |||||
ANNOUNCEMENT OF INTERIM RESULTS 2020
4. INCOME STATEMENT OF PARENT COMPANY
Unit: RMB | ||||
Amount for the first | Amount for the first | |||
Items | half of 2020 | half of 2019 | ||
I. | Total operating income | 0.00 | 0.00 | |
Less: Operating cost | 2,482,469.19 | 5,499,074.25 | ||
Taxes & surcharges | ||||
Cost of sales | ||||
Administrative expenses | 2,478,916.69 | 5,495,067.51 | ||
Research and development expenses | ||||
Financial expenses | 3,552.50 | 4,006.74 | ||
Incl.: Interest expenses | ||||
Interest income | ||||
Add: Other income | ||||
Investment income ("-" represents loss) | ||||
Incl.: Investment income from associates and | ||||
joint ventures | ||||
Income from derecognition of financial assets at | ||||
amortised cost ("-" represents loss) | ||||
Net exposure hedge income ("-" represents | ||||
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD. | loss) | |||
60
ANNOUNCEMENT OF INTERIM RESULTS 2020
4. INCOME STATEMENT OF PARENT COMPANY (Continued)
Unit: RMB | ||
Amount for the first | Amount for the first | |
Items | half of 2020 | half of 2019 |
Gains on the changes in fair value ("-" | ||
represents loss) | ||
Credit impairment loss ("-" represents loss) | ||
Loss on asset impairment ("-" represents loss) | ||
Gain on disposal of assets ("-" represents loss) | ||
II. Operational profit ("-" represents loss) | -2,482,469.19 | -5,499,074.25 |
Add: Non-operating income | 0.07 | |
Less: Non-operating expenses | ||
III. Total profit ("-" represents total loss) | -2,482,469.12 | -5,499,074.25 |
Less: Income tax expenses | ||
IV. Net profit ("-" represents net loss) | -2,482,469.12 | -5,499,074.25 |
(I) Net profit from continuing operations | ||
("-" represents net loss) | -2,482,469.12 | -5,499,074.25 |
(II) Net profit from discontinued operations ("-" | ||
represents net loss) | ||
V. Net other comprehensive income after tax | ||
A. Other comprehensive income not reclassifiable | ||
to profit or loss | ||
1. Remeasurement of changes in defined | ||
benefit plans | ||
2. Other comprehensive income not reclassifiable | ||
to profit or loss under the equity method | ||
3. Changes in the fair value of other equity | ||
instruments investment | ||
4. Changes in the fair value of the Company's | ||
own credit risk | ||
5. Others | ||
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
61
ANNOUNCEMENT OF INTERIM RESULTS 2020
4. INCOME STATEMENT OF PARENT COMPANY (Continued)
Unit: RMB | ||||
Amount for the first | Amount for the first | |||
Items | half of 2020 | half of 2019 | ||
B. Other comprehensive income reclassifiable to profit | ||||
or loss | ||||
1. | Other comprehensive income reclassifiable to | |||
profit and loss under the equity method | ||||
2. | Changes in the fair value of other debt | |||
investments | ||||
3. | Amount of financial assets reclassified into other | |||
comprehensive income | ||||
4. | Credit impairment provisions for other debt | |||
investments | ||||
5. | Cash flow hedge reserve | |||
6. | Exchange difference on translation of foreign | |||
financial statements | ||||
7. | Others | |||
VI. Total comprehensive income | -2,482,469.12 | -5,499,074.25 | ||
VII. Earnings per share: | ||||
(I) Basic earnings per share | ||||
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD. | (II) Diluted earnings per share | |||
62
ANNOUNCEMENT OF INTERIM RESULTS 2020
5. CONSOLIDATED CASH FLOW STATEMENT
Unit: RMB | |||||
Amount for the | Amount for the | ||||
Items | first half of 2020 | first half of 2019 | |||
I. | Cash flow from operating activities: | ||||
Cash received from sales of goods or rendering of services | 34,140,434.98 | 38,986,746.98 | |||
Net increase in deposits from customers and interbank | |||||
Net increase in borrowings from central bank | |||||
Net increase in borrowings from other financial institutions | |||||
Cash received from premiums under original insurance | |||||
contracts | |||||
Cash received from reinsurance business, net | |||||
Net increase in policyholders' deposits and investment | |||||
Cash from interests, fees and commissions | 992,292.57 | ||||
Net increase in borrowings from banks and other financial | |||||
institutions | |||||
Net increase in income from repurchase transactions | |||||
Cash received from securities brokerage services, net | |||||
Tax refunds received | |||||
Other cash receipts relating to operating activities | 83,322,917.49 | 14,822,608.85 | |||
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD. | |||||
Sub-total of cash inflows from operating activities | 118,455,645.04 | 53,809,355.83 | |||
63 | |||||
ANNOUNCEMENT OF INTERIM RESULTS 2020
5. CONSOLIDATED CASH FLOW STATEMENT (Continued)
Unit: RMB | ||
Amount for the | Amount for the | |
Items | first half of 2020 | first half of 2019 |
Cash paid to goods purchased and labor service received | 25,687,390.51 | 17,595,768.96 |
Net increase in customers' loans and advances | ||
Net increase in deposits with central bank and inter-bank | ||
Cash paid for compensation payout under original insurance | ||
contracts | ||
Net increase in loans to banks and other financial institutions | ||
Cash paid for interests, fees and commissions | 5,815.57 | |
Cash paid for policy dividends | ||
Cash paid to and for employees | 8,625,644.27 | 11,062,378.49 |
Payments of taxes and surcharges | 1,024,700.09 | 1,217,294.47 |
Other cash payments relating to operating activities | 21,409,395.47 | 26,025,833.20 |
Sub-total of cash outflows for operating activities | 56,752,945.91 | 55,901,275.12 |
Net cash flow from operating activities | 61,702,699.13 | -2,091,919.29 |
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
64
ANNOUNCEMENT OF INTERIM RESULTS 2020
5. CONSOLIDATED CASH FLOW STATEMENT (Continued)
Unit: RMB | ||||
Amount for the | Amount for the | |||
Items | first half of 2020 | first half of 2019 | ||
II. Cash flow from investing activities: | ||||
Cash from disinvestments | ||||
Cash received from return of investments | ||||
Net cash received from disposal of fixed assets, intangible | ||||
assets and other long-term assets | ||||
Net cash received from disposal of subsidiaries and other | ||||
operating units | ||||
Other cash receipts relating to investing activities | ||||
Sub-total of cash inflows from investing activities | ||||
Cash paid in purchase/construction of fixed assets, intangible | ||||
assets and other long-term assets | 160,513.12 | |||
Cash paid for investment | 48,435,719.34 | |||
Net increase of mortgaged loans | ||||
Net cash paid for acquisition of subsidiaries and other | ||||
operating units | ||||
Other cash payments relating to investing activities | ||||
Sub-total of cash outflows for investing activities | 48,435,719.34 | 160,513.12 | ||
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD. | ||||
Net cash flow from investing activities | -48,435,719.34 | -160,513.12 | ||
65 | ||||
ANNOUNCEMENT OF INTERIM RESULTS 2020
5. CONSOLIDATED CASH FLOW STATEMENT (Continued)
Unit: RMB | ||||
Amount for the | Amount for the | |||
Items | first half of 2020 | first half of 2019 | ||
III. | Cash flow from financing activities: | |||
Cash received by absorbing investment | ||||
Incl.: Cash received by subsidiaries from minority interests | ||||
Cash received from borrowings | ||||
Other cash receipts relating to financing activities | ||||
Sub-total of cash inflows from financing activities | ||||
Cash paid for repayments of debts | 10,500,000.00 | |||
Cash paid for dividends, profits distribution or interests | 225,709.27 | 131,478.61 | ||
Incl.: Dividends and profits paid by subsidiaries to minority | ||||
interests | ||||
Other cash payments relating to financing activities | 2,055,359.68 | |||
Sub-total of cash outflows for financing activities | 10,725,709.27 | 2,186,838.29 | ||
Net cash flow from financing activities | -10,725,709.27 | -2,186,838.29 | ||
IV. | Effect of changes in foreign currency rates on cash and | |||
cash equivalents | 34,028.92 | 1,094.82 | ||
V. | Net increase in cash and cash equivalent | 2,575,299.44 | -4,438,175.88 | |
LTD. | ||||
Add: Balance of cash and cash equivalents at beginning of | ||||
CO., | period | 74,527,767.65 | 84,724,338.23 | |
VI. | Balance of cash and cash equivalents at end of period | 77,103,067.09 | 80,286,162.35 | |
NORTHEAST ELECTRIC DEVELOPMENT | ||||
66
ANNOUNCEMENT OF INTERIM RESULTS 2020
6. CASH FLOW STATEMENT OF PARENT COMPANY
Unit: RMB | |||||
Amount for the | Amount for the | ||||
Items | first half of 2020 | first half of 2019 | |||
I. | Cash flow from operating activities | ||||
Cash received from sales of goods or rendering of services | |||||
Tax refunds received | |||||
Other cash receipts relating to operating activities | 3,020,491.01 | 7,511,146.05 | |||
Sub-total of cash inflows from operating activities | 3,020,491.01 | 7,511,146.05 | |||
Cash paid to goods purchased and labor service received | |||||
Cash paid to and for employees | 2,009,400.18 | 4,138,706.20 | |||
Payments of taxes and surcharges | |||||
Other cash payments relating to operating activities | 1,007,819.42 | 3,425,100.17 | |||
Sub-total of cash outflows for operating activities | 3,017,219.60 | 7,563,806.37 | |||
Net cash flow from operating activities | 3,271.41 | -52,660.32 | |||
II. | Cash flow from investing activities: | ||||
Cash from disinvestments | |||||
Cash received return of investments | |||||
Net cash received from disposal of fixed assets, intangible | |||||
assets and other long-term assets | |||||
LTD. | |||||
Net cash received from disposal of subsidiaries and other | |||||
operating units | CO., | ||||
Other cash receipts relating to investing activities | |||||
DEVELOPMENTELECTRICNORTHEAST | |||||
Sub-total of cash inflows from investing activities | |||||
67 | |||||
ANNOUNCEMENT OF INTERIM RESULTS 2020
6. CASH FLOW STATEMENT OF PARENT COMPANY (Continued)
Unit: RMB | ||||
Amount for the | Amount for the | |||
Items | first half of 2020 | first half of 2019 | ||
Cash paid in purchase/construction of fixed assets, intangible | ||||
assets and other long-term assets | ||||
Cash paid for investment | ||||
Net cash paid for acquisition of subsidiaries and other | ||||
operating units | ||||
Other cash payments relating to investing activities | ||||
Sub-total of cash outflows for investing activities | ||||
Net cash flow from investing activities | ||||
III. | Cash flow from financing activities: | |||
Cash received by absorbing investment | ||||
Cash received from borrowings | ||||
Other cash receipts relating to financing activities | ||||
Sub-total of cash inflows from financing activities | ||||
Cash paid for repayments of debts | ||||
Cash paid for dividends, profits distribution or interests | ||||
Other cash payments relating to financing activities | ||||
LTD. | ||||
Sub-total of cash outflows for financing activities | ||||
CO., | ||||
Net cash flow from financing activities | ||||
DEVELOPMENT | IV. | Effect of changes in foreign currency rates on cash and | ||
cash equivalents | -696.38 | |||
V. | Net increase in cash and cash equivalents | 3,271.41 | -53,356.70 | |
Add: Balance of cash and cash equivalents at beginning of | ||||
ELECTRICNORTHEAST | period | 893.51 | 131,150.21 | |
VI. | Balance of cash and cash equivalents at end of period | 4,164.92 | 77,793.51 | |
68
7. CONSOLIDATED STATEMENT OF CHANGES IN OWNER'S EQUITY
Amount for the current period
Unit: RMB
Amount for the first half of 2020 | |||||||||||||||||||||
Equity attributable to shareholders of the parent company | |||||||||||||||||||||
Other equity instruments | |||||||||||||||||||||
Less: | Other | Total | |||||||||||||||||||
Capital | Treasury | comprehensive | Special | Surplus | Provision for | Retained | Minority | shareholders' | |||||||||||||
Items | Share capital | Preferred | Perpetual | Others | reserve | stock | income | reserve | reserve | general risks | profits | Others | Subtotal | interests | equity | ||||||
I. | Balance at end of last year | 873,370,000.00 | 1,082,848,805.11 | -62,076,254.02 | 108,587,124.40 | -2,059,319,937.47 | -56,590,261.98 | 5,483,407.13 | -51,106,854.85 | ||||||||||||
Add: Changes in accounting policies | |||||||||||||||||||||
Corrections to previous errors | |||||||||||||||||||||
Effect of business combination | |||||||||||||||||||||
under common control | |||||||||||||||||||||
Others | |||||||||||||||||||||
II. | Balance at beginning of year | 873,370,000.00 | 1,082,848,805.11 | -62,076,254.02 | 108,587,124.40 | -2,059,319,937.47 | -56,590,261.98 | 5,483,407.13 | -51,106,854.85 | ||||||||||||
III. | Changes in the current period | ||||||||||||||||||||
("-" represents loss) | 528,612.48 | 111,614.78 | -11,818,431.23 | -11,178,203.97 | -55,807.39 | -11,234,011.36 | |||||||||||||||
(I) | Total comprehensive income | 111,614.78 | -11,818,431.23 | -11,706,816.45 | -55,807.39 | -11,762,623.84 | |||||||||||||||
(II) | Increase/Decrease of capital from | ||||||||||||||||||||
shareholders | 528,612.48 | 528,612.48 | 528,612.48 | ||||||||||||||||||
1. | Ordinary shares invested by | ||||||||||||||||||||
shareholders | |||||||||||||||||||||
2. | Capital contributed by holders | ||||||||||||||||||||
of other equity instrument | |||||||||||||||||||||
3. | Shares payment taken into | ||||||||||||||||||||
shareholder's equity | |||||||||||||||||||||
4. | Others | 528,612.48 | 528,612.48 | 528,612.48 | |||||||||||||||||
(III) | Distribution of profit | ||||||||||||||||||||
1. | Appropriation of surplus reserves | ||||||||||||||||||||
2. | Appropriation of general risk | ||||||||||||||||||||
provision | |||||||||||||||||||||
3. | Distribution to shareholders | ||||||||||||||||||||
4. | Others | ||||||||||||||||||||
2020 RESULTS INTERIM OF ANNOUNCEMENT
69
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
70 | NORTHEAST ELECTRIC DEVELOPMENT CO., LTD. |
7. CONSOLIDATED STATEMENT OF CHANGES IN OWNER'S EQUITY (Continued)
Amount for the previous period (Continued)
Unit: RMB | ||||||||||||||||||||
Amount for the first half of 2020 | ||||||||||||||||||||
Equity attributable to shareholders of the parent company | ||||||||||||||||||||
Other equity instruments | ||||||||||||||||||||
Less: | Other | Total | ||||||||||||||||||
Capital | Treasury | comprehensive | Special | Surplus | Provision for | Retained | Minority | shareholders' | ||||||||||||
Items | Share capital | Preferred | Perpetual | Others | reserve | stock | income | reserve | reserve | general risks | profits | Others | Subtotal | interests | equity | |||||
(IV) | Transfer within equity | |||||||||||||||||||
1. | Transfer-in from capital reserves | |||||||||||||||||||
2. | Transfer-in from surplus reserves | |||||||||||||||||||
3. | Loss covered by surplus | |||||||||||||||||||
reserves | ||||||||||||||||||||
4. | Changes in defined benefit plan | |||||||||||||||||||
transferred to retained earnings | ||||||||||||||||||||
5. | Other comprehensive income | |||||||||||||||||||
transferred to retained earnings | ||||||||||||||||||||
6. | Others | |||||||||||||||||||
(V) | Special reverses | |||||||||||||||||||
1. | Appropriation of the special | |||||||||||||||||||
reverses | ||||||||||||||||||||
2. | Usage of the special reverses | |||||||||||||||||||
(VI) | Others | |||||||||||||||||||
IV. Balance at end of period | 873,370,000.00 | 1,083,377,417.59 | -61,964,639.24 | 108,587,124.40 | -2,071,138,368.70 | -67,768,465.95 | 5,427,599.74 | -62,340,866.21 | ||||||||||||
2020 RESULTS INTERIM OF ANNOUNCEMENT
7. CONSOLIDATED STATEMENT OF CHANGES IN OWNER'S EQUITY (Continued)
Amount for the previous period
Unit: RMB | ||||||||||||||||
Amount for the first half of 2019 | ||||||||||||||||
Equity attributable to shareholders of the parent company | ||||||||||||||||
Other equity instruments | Less: | Other | Total | |||||||||||||
Treasury | comprehensive | Special | Surplus | Provision for | Retained | shareholders' | ||||||||||
Items | Share capital | Preferred | Perpetual | Others | Capital reserve | stock | income | reserve | reserve | general risks | profits | Others | Subtotal | Minority interests | equity | |
I. | Balance at end of last year | 873,370,000.00 | 1,074,828,788.67 | -29,012,497.21 | 108,587,124.40 | -2,019,154,197.71 | 8,619,218.15 | 13,497,161.81 | 22,116,379.96 | |||||||
Add: Changes in accounting policies | ||||||||||||||||
Corrections to previous errors | ||||||||||||||||
Effect of business combination under | ||||||||||||||||
common control | ||||||||||||||||
Others | ||||||||||||||||
II. | Balance at beginning of year | 873,370,000.00 | 1,074,828,788.67 | -29,012,497.21 | 108,587,124.40 | -2,019,154,197.71 | 8,619,218.15 | 13,497,161.81 | 22,116,379.96 | |||||||
III. | Changes in the current period | |||||||||||||||
("-" represents loss) | 8,014,911.19 | 346,094.29 | -3,924,330.74 | 4,436,674.74 | -7,999,305.99 | -3,562,631.25 | ||||||||||
(I) Total comprehensive income | 346,094.29 | -3,924,330.74 | -3,578,236.45 | 15,605.20 | -3,562,631.25 |
- Increase/Decrease of capital from
shareholders | 8,014,911.19 | 8,014,911.19 | -8,014,911.19 |
- Ordinary shares invested by shareholders
- Capital contributed by holders of other equity instrument
- Shares payment taken into
shareholder's equity | -8,014,911.19 |
4. Others | 8,014,911.19 |
71 | NORTHEAST ELECTRIC DEVELOPMENT CO., LTD. |
2020 RESULTS INTERIM OF ANNOUNCEMENT
72 | NORTHEAST ELECTRIC DEVELOPMENT CO., LTD. |
7. CONSOLIDATED STATEMENT OF CHANGES IN OWNER'S EQUITY (Continued)
Amount for the previous period (Continued)
Unit: RMB | |||||||||||||||
Amount for the first half of 2019 | |||||||||||||||
Equity attributable to shareholders of the parent company | |||||||||||||||
Other equity instruments | Less: | Other | Total | ||||||||||||
Treasury | comprehensive | Special | Surplus | Provision for | Retained | shareholders' | |||||||||
Items | Share capital | Preferred | Perpetual | Others | Capital reserve | stock | income | reserve | reserve | general risks | profits | Others | Subtotal | Minority interests | equity |
- Distribution of profit
- Appropriation of surplus reserves
- Appropriation of general risk provision
- Distribution to shareholders
- Others
(IV) Transfer within equity
- Transfer-infrom capital reserves
- Transfer-infrom surplus reserves
- Loss covered by surplus reserves
- Changes in defined benefit plan transferred to retained earnings
- Other comprehensive income transferred to retained earnings
- Others
- Special reverses
- Appropriation of the special reverses
- Usage of the special reverses (VI) Others
IV. | Balance at end of period | 873,370,000.00 | 1,082,843,699.86 | -28,666,402.92 | 108,587,124.40 | -2,023,078,528.45 | 13,055,892.89 | 5,497,855.82 | 18,553,748.71 |
2020 RESULTS INTERIM OF ANNOUNCEMENT
8. STATEMENT OF CHANGES IN OWNER'S EQUITY OF PARENT COMPANY
Amount for the current period
Unit: RMB | |||||||||||||||||
Amount for the first half of 2020 | |||||||||||||||||
Other equity instruments | Less: | Other | Total | ||||||||||||||
Share | Capital | Treasury | comprehensive | Special | Surplus | shareholders' | |||||||||||
Items | capital | Preferred | Perpetual | Others | reserve | stock | income | reserve | reserve | Retained profits | Others | equity | |||||
I. Balance at end of last year | 873,370,000.00 | 995,721,167.46 | 108,587,124.40 | -2,073,438,269.53 | -95,759,977.67 | ||||||||||||
Add: Changes in accounting policies | |||||||||||||||||
Corrections to previous errors | |||||||||||||||||
Others | |||||||||||||||||
II. Balance at beginning of year | 873,370,000.00 | 995,721,167.46 | 108,587,124.40 | -2,073,438,269.53 | -95,759,977.67 | ||||||||||||
III. Changes in the current period ("-" | |||||||||||||||||
represents loss) | 528,612.48 | -2,482,469.12 | -1,953,856.64 | ||||||||||||||
(I) | Total comprehensive income | -2,482,469.12 | -2,482,469.12 | ANNOUNCEMENT | |||||||||||||
(II) | Increase/Decrease of capital from | ||||||||||||||||
shareholders | 528,612.48 | 528,612.48 | |||||||||||||||
1. | Ordinary shares invested by | ||||||||||||||||
shareholders | |||||||||||||||||
2. | Capital contributed by holders | ||||||||||||||||
of other equity instrument | |||||||||||||||||
OF | |||||||||||||||||
3. | Shares payment taken into | ||||||||||||||||
INTERIM | |||||||||||||||||
shareholder's equity | |||||||||||||||||
4. | Others | 528,612.48 | 528,612.48 | ||||||||||||||
(III) | Distribution of profit | RESULTS | |||||||||||||||
1. | Appropriation of surplus | ||||||||||||||||
reserves | |||||||||||||||||
2. | Distribution to shareholders | ||||||||||||||||
2020 | |||||||||||||||||
3. | Others | ||||||||||||||||
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8. STATEMENT OF CHANGES IN OWNER'S EQUITY OF PARENT COMPANY (Continued)
Amount for the current period (Continued)
Unit: RMB | ||||||||||||||||
Amount for the first half of 2020 | ||||||||||||||||
Other equity instruments | Less: | Other | Total | |||||||||||||
Share | Capital | Treasury | comprehensive | Special | Surplus | shareholders' | ||||||||||
Items | capital | Preferred | Perpetual | Others | reserve | stock | income | reserve | reserve | Retained profits | Others | equity | ||||
(IV) | Transfer within equity | |||||||||||||||
1. | Transfer-in from capital | |||||||||||||||
reserves | ||||||||||||||||
2. | Transfer-in from surplus | |||||||||||||||
reserves | ||||||||||||||||
3. | Loss covered by surplus | |||||||||||||||
reserves | ||||||||||||||||
4. | Changes in defined benefit | |||||||||||||||
plan transferred to retained | ||||||||||||||||
earnings | ||||||||||||||||
5. | Other comprehensive income | |||||||||||||||
transferred to retained earnings | ||||||||||||||||
6. | Others | |||||||||||||||
(V) | Special reverses | |||||||||||||||
1. | Appropriation of the special | |||||||||||||||
reverses | ||||||||||||||||
2. | Usage of the special reverses | |||||||||||||||
(VI) | Others | |||||||||||||||
IV. Balance at end of period | 873,370,000.00 | 996,249,779.94 | 108,587,124.40 | -2,075,920,738.65 | -97,713,834.31 | |||||||||||
2020 RESULTS INTERIM OF ANNOUNCEMENT
8. STATEMENT OF CHANGES IN OWNER'S EQUITY OF PARENT COMPANY (Continued)
Amount for the previous period
Unit: RMB | |||||||||||||||||
Amount for the first half of 2019 | |||||||||||||||||
Other equity instruments | Less: | Other | Total | ||||||||||||||
Share | Capital | Treasury | comprehensive | Special | Surplus | Retained | shareholders' | ||||||||||
Items | capital | Preferred | Perpetual | Others | reserve | stock | income | reserve | reserve | profits | Others | equity | |||||
I. Balance at end of last year | 873,370,000.00 | 995,721,167.46 | 108,587,124.40 | -2,062,911,369.67 | -85,233,077.81 | ||||||||||||
Add: Changes in accounting policies | |||||||||||||||||
Corrections to previous errors | |||||||||||||||||
Others | |||||||||||||||||
II. Balance at beginning of year | 873,370,000.00 | 995,721,167.46 | 108,587,124.40 | -2,062,911,369.67 | -85,233,077.81 | ||||||||||||
III. Changes in the current period | -5,499,074.25 | -5,499,074.25 | |||||||||||||||
("-" represents loss) | |||||||||||||||||
(I) | Total comprehensive income | -5,499,074.25 | -5,499,074.25 | ||||||||||||||
(II) | Increase/Decrease of capital from | ANNOUNCEMENT | |||||||||||||||
shareholders | |||||||||||||||||
1. | Ordinary shares invested by | ||||||||||||||||
shareholders | |||||||||||||||||
2. | Capital contributed by holders | ||||||||||||||||
of other equity instrument | |||||||||||||||||
3. | Shares payment taken into | ||||||||||||||||
shareholder's equity | OF | ||||||||||||||||
4. | Others | ||||||||||||||||
INTERIM | |||||||||||||||||
(III) | Distribution of profit | ||||||||||||||||
1. | Appropriation of surplus | ||||||||||||||||
reserves | |||||||||||||||||
2020RESULTS | |||||||||||||||||
2. | Distribution to shareholders | ||||||||||||||||
3. | Others | ||||||||||||||||
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8. STATEMENT OF CHANGES IN OWNER'S EQUITY OF PARENT COMPANY (Continued)
Amount for the previous period (Continued)
Unit: RMB | ||||||||||||||||
Amount for the first half of 2019 | ||||||||||||||||
Other equity instruments | Less: | Other | Total | |||||||||||||
Share | Capital | Treasury | comprehensive | Special | Surplus | Retained | shareholders' | |||||||||
Items | capital | Preferred | Perpetual | Others | reserve | stock | income | reserve | reserve | profits | Others | equity | ||||
(IV) | Transfer within equity | |||||||||||||||
1. | Transfer-in from capital | |||||||||||||||
reserves | ||||||||||||||||
2. | Transfer-in from surplus | |||||||||||||||
reserves | ||||||||||||||||
3. | Loss covered by surplus | |||||||||||||||
reserves | ||||||||||||||||
4. | Changes in defined benefit | |||||||||||||||
plan transferred to retained | ||||||||||||||||
earnings | ||||||||||||||||
5. | Other comprehensive income | |||||||||||||||
transferred to retained earnings | ||||||||||||||||
6. | Others | |||||||||||||||
(V) | Special reverses | |||||||||||||||
1. | Appropriation of the special | |||||||||||||||
reverses | ||||||||||||||||
2. | Usage of the special reverses | |||||||||||||||
(VI) | Others | |||||||||||||||
IV. Balance at end of period | 873,370,000.00 | 995,721,167.46 | 108,587,124.40 | -2,068,410,443.92 | -90,732,152.06 | |||||||||||
2020 RESULTS INTERIM OF ANNOUNCEMENT
Legal representative: Zhu Jie | Chief financial officer: Wang Kai | Chief accounting officer: Wang Kai |
ANNOUNCEMENT OF INTERIM RESULTS 2020
-
Explanation of changes in accounting policy, accounting estimates and accounting methods in comparison with the financial report of the previous year
There is no change in accounting policy, accounting estimates and accounting methods in comparison with the financial report of the previous year. - Description of retrospective restatement of major accounting errors in the reporting period
There was no retrospective restatement of major accounting errors in the reporting period. - Description of changes in the coverage of the consolidated statements as compared to the financial report for the previous year
There is no change in the coverage of the consolidated statements as compared to the financial report for the previous year. - Others
10.4.1 Business distribution
All of the Group's incomes and profits were from the domestic market, so the Group's management considers there is no need to prepare the divisional statement.
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ANNOUNCEMENT OF INTERIM RESULTS 2020
NORTHEAST ELECTRIC DEVELOPMENT CO., LTD.
10.4.2 Taxation
Main taxation category and tax rate of the Company
Category | Tax Base | Tax Rate |
VAT | The taxable income is calculated at the tax rates | 16%, 13%, 6% |
of 16%, 13%, 6%, and the VAT payable is | ||
determined by the output VAT net of deductible | ||
input VAT of the period. | ||
Urban construction & | At 7% of the turnover tax actually paid. | 7% |
maintenance tax | ||
Corporate income tax | At 25% of the taxable income payable. | 25%, 16.5% |
Educational surcharge | At 5% of the turnover tax actually paid. | 5% |
Notes:
- For Northeast Electric Development (Hong Kong) Limited, a wholly-owned subsidiary of the Company registered in HKSAR of the PRC, the profits tax rate is 16.5%.
- Gaocai Technology Co., Ltd. is a wholly-owned subsidiary, registered in the British Virgin Islands. No corporate income tax is imposed on it.
- The corporate income tax of Shenyang Kaiyi Electric Co., Ltd., a subsidiary of the Company, is collected in a way of verification.
10.4.3 Net profit
The reporting | The same period | |
period | of last year | |
Net profit attributable to shareholders of the parent | -11,818,431.23 | -3,924,330.74 |
company (RMB) | ||
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ANNOUNCEMENT OF INTERIM RESULTS 2020
10.4.4 Earnings per share
The reporting | The same period | |
period | of last year | |
Basic earnings per share (RMB/share) | -0.0135 | -0.0045 |
Diluted earnings per share (RMB/share) | -0.0135 | -0.0045 |
- Dividends
No dividends were paid or proposed for the six months ended 30 June 2020 (for the six months ended 30 June 2019: Nil), and no dividend was proposed from the end of the reporting period. - Share capital
The reporting | The same period | |
period | of last year | |
Total share capital (RMB) | 873,370,000.00 | 873,370,000.00 |
10.5 Publication of the interim report on the internet websites of The Stock Exchange of Hong Kong Limited and the Company
All information about the interim report as required by Appendix 16 to the Listing Rules will be published on the Hong Kong Stock Exchange's website (http://www.hkex.com.hk) and the Company's website (http://www.nee.com.cn) in due course.
By order of the Board
Zhu Jie
Chairman
Haikou, Hainan Province, the PRC
28 August 2020
As at the date of the Announcement, the Board of Directors comprises of six executive directors, namely Mr. Zhu Jie, Mr. Wang Yongfan, Mr. Bao Zongbao, Mr. Su Weiguo, Mr. Guo Qianli and Mr. Li Guoqing; and three independent non-executive directors, namely Mr. Li Ming, Mr. Fang Guangrong and Mr. Wang Hongyu.
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NEE - Northeast Electric Development Co. Ltd. published this content on 28 August 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 28 August 2020 09:22:11 UTC