CHINA HAISHENG JUICE HOLDINGS CO., LTD INTERIM
2020 Interim Report
Contents
Corporate Information | 2 |
Highlights | 3 |
Management Discussion and Analysis | 4 |
Other Information | 13 |
Condensed Consolidated Statement of Profit or Loss and | |
Other Comprehensive Income | 19 |
Condensed Consolidated Statement of Financial Position | 21 |
Condensed Consolidated Statement of Changes in Equity | 23 |
Condensed Consolidated Statement of Cash Flows | 25 |
Notes to the Condensed Interim Consolidated | |
Financial Statements | 26 |
Interim Report 2020 | 1 |
Corporate Information
Stock Code
359
Executive Directors:
Mr. Gao Liang (Chairman)
Mr. Wang Junqing
Mr. Wang Yasen
Mr. Wang Linsong
Independent non-executive directors:
Mr. Zhao Boxiang
Mr. Liu Zhongli
Ms. Huang Liqiong
Company Secretary
Mr. Terence Sin Yuen Ko, FCCA
Authorised Representatives
Mr. Gao Liang
Mr. Terence Sin Yuen Ko, FCCA
Audit Committee Members
Ms. Huang Liqiong (Chairman)
Mr. Zhao Boxiang
Mr. Liu Zhongli
Remuneration Committee Members
Mr. Zhao Boxiang (Chairman)
Mr. Liu Zhongli
Ms. Huang Liqiong
Nomination Committee Members
Mr. Gao Liang (Chairman)
Mr. Liu Zhongli
Mr. Zhao Boxiang
Ms. Huang Liqiong
Registered Office
Cricket Square
Hutchins Drive
P.O. Box 2681
Grand Cayman KY1-1111
Cayman Islands
Head Office and Principal Place of Business in Hong Kong
Room B, 3rd Floor Eton Building
288 Des Voeux Road Central Hong Kong
Website Address
www.chinahaisheng.com
Principal Share Registrar and Transfer Office
Royal Bank of Canada Trust Company (Cayman) Limited
4th Floor, Royal Bank House
24 Shedden Road, George Town Grand Cayman KY1-1110 Cayman Islands
Hong Kong Branch Share Registrar and Transfer Office
Computershare Hong Kong Investor
Services Limited
Shops 1712-1716, 17th Floor
Hopewell Centre
183 Queen's Road East, Wanchai
Hong Kong
Principal Bankers
Agriculture Bank of China
The Export-Import Bank of China
2 China Haisheng Juice Holdings Co., Ltd.
Highlights
HIGHLIGHTS
- For the six months ended 30 June 2020, the Group's unaudited turnover decreased from approximately RMB503.4 million to approximately RMB425.1 million, representing a decrease of approximately 15.6% over the same period of last year.
- For the six months ended 30 June 2020, the Group's unaudited loss attributable to owners of the Company increased from approximately RMB79.9 million to approximately RMB85.8 million, representing an increase of approximately 7.4% over the same period of last year.
- The Board does not recommend the payment of an interim dividend for the six months ended 30 June 2020 (2019: Nil).
Interim Report 2020 | 3 |
Management Discussion and Analysis
Financial review
The Board announces that, for the six months ended 30 June 2020, the Group recorded an unaudited turnover of approximately RMB425.1 million, representing a decrease of approximately 15.6% over the same period of last year. Gross profit margin for the six months ended 30 June 2020 was approximately 21.4%, as compared with 27.8% for the same period of last year. The Group's unaudited loss attributable to owners of the Company increased from approximately RMB79.9 million to approximately RMB85.8 million, representing an increase of approximately 7.4% over the same period of last year.
For the period under review, turnover decreased by approximately 15.6% to approximately RMB425.1 million. Such decrease was mainly attributable to the fact that the demand for juice in domestic and foreign markets has decreased because of the adverse effect of COVID-19. Meanwhile, the agricultural income has increased slightly.
For the period under review, the gross profit margin of the Group decreased from approximately 27.8% to approximately 21.4% which was mainly attributable to slower commodity circulation during the epidemic. But the prolonged storage period of fresh fruits affected their selling prices. Therefore, the gross profit margin of fresh fruits decreased compared to the same period last year. Compared with the same period of last year, the gross profit margin for juice increased slightly due to the price fluctuations in raw material.
Other income decreased by approximately 13.4% to approximately RMB96.5 million. Such decrease was mainly attributable to the decrease in government subsidies recognized during the period under review.
Distribution costs decreased by approximately 22.4% to approximately RMB100.8 million during the period under review. Such decrease was mainly attributable to (i) the reduction or exemption of employees' social security that companies should pay during the epidemic, and
- the increase in distribution channels in wholesale markets and the decrease in promotional expense for the sale of apples and other fruits.
4 China Haisheng Juice Holdings Co., Ltd.
Management Discussion and Analysis
Administrative expenses decreased by approximately 10.2% to approximately RMB113.5 million during the period under review. The decrease in administrative expenses was mainly attributable to that the government reduced or exempted tax and employees' social security that companies should pay during the epidemic.
Finance costs of the Group amounted to approximately RMB78.2 million in the period under review, representing an increase of approximately 6.3% over the same period of last year. The increase is attributable to the increase in the Group's bank loans during the period.
As a result of the foregoing, the Group's unaudited loss attributable to owners of the Company increase from approximately RMB79.9 million to approximately RMB85.8 million, representing an increase of approximately 7.4% over the same period of last year.
Liquidity, financial resources, capital structure and gearing
The treasury policy of the Group is centrally managed and controlled at the corporate level. As at 30 June 2020, the Group's bank and other borrowings, bills payable and lease liabilities amounted to approximately RMB5,727.8 million (as at 31 December 2019: RMB4,960.0 million), among which, approximately RMB2,420.5 million were secured by way of charge on the Group's assets. Approximately RMB1,946.0 million of the sum were due within one year and approximately RMB3,781.8 million of the sum were due within two to five years. The whole sum were denominated in RMB.
30 June | 31 December | |
2020 | 2019 | |
RMB'000 | RMB'000 | |
(Unaudited) | (Audited) | |
Bank loans | 3,410,763 | 2,473,748 |
Other borrowings | 969,875 | 968,128 |
Loan from government | 234,570 | 159,550 |
Bills payable | 87,899 | 186,000 |
Lease liabilities | 1,024,712 | 1,172,618 |
5,727,819 | 4,960,044 | |
Interim Report 2020 | 5 |
Management Discussion and Analysis
Among the bank loans, other borrowings and loan from government, approximately RMB2,504.7 million of the sum were fixed-rate borrowings while approximately RMB2,110.5 million were variable-rate borrowings. The interest rate for the variable-rate borrowings is based on London Interbank Offered Rate/The People's Bank of China Base Lending Rate plus a margin for both years.
As at 30 June 2020, the cash and bank balances including pledged bank deposits amounted to approximately RMB452.2 million (as at 31 December 2019: RMB315.3 million).
The Group monitors capital using gearing ratio, which is net debt divided by the total equity. Net debt is calculated as bank loans, loan from government, bills payable, other borrowings and lease liabilities less pledged bank deposits and cash and cash equivalents as shown in the consolidated statement of financial position. Total equity comprises all components of equity. The Group aims to maintain the gearing ratio at a reasonable level. At 30 June 2020, the gearing ratio was 250.2%.
Significant investments held and material acquisition and disposals
- On 16 January 2020, 陝西超越農業有限公司 (Shaanxi Chaoyue Agriculture Company Limited*) ("Shaanxi Chaoyue"), a non-wholly owned subsidiary of the Company, entered into a joint venture agreement ("Agreement I") with 古浪縣扶貧產業開發有限公 司 (Gulang County Poverty Alleviation Industrial Development Company Limited*) ("Gulang Poverty Alleviation"), an independent third party at the time of the Agreement I, pursuant to which Shaanxi Chaoyue and Gulang Poverty Alleviation have agreed to establish a joint venture company in the PRC ("JV Company I") with a registered capital of RMB40 million and each of Shaanxi Chaoyue and Gulang Poverty Alleviation has agreed to contribute to the registered capital of the JV Company I at RMB32 million and RMB8 million, respectively. Shaanxi Chaoyue and Gulang Poverty Alleviation will own 80% and 20% of the equity interests of the JV Company I, respectively, after the capital contributions.
- For identification purpose only
6 China Haisheng Juice Holdings Co., Ltd.
Management Discussion and Analysis
- On 17 March 2020, Shaanxi Chaoyue, a non-wholly owned subsidiary of the Company, entered into a joint venture agreement ("Agreement II") with 寧縣聚農蘋果產業資金專 業合作社 (Ningxian Junong Apple Industry Fund Professional Cooperative*) ("Ningxian Junong"), 寧縣金農農業扶貧開發有限公司 (Ningxian Jinnong Agriculture Poverty Alleviation and Development Co., Ltd.*) ("Ningxian Jinnong") and 寧縣果業局 (the Fruit Industry Bureau of Ning County*) ("Fruit Industry Bureau") (save for Ningxian Junong being a substantial shareholder of an indirectly non-wholly owned subsidiary of the Company, Ningxian Jinnong and the Fruit Industry Bureau were independent third parties at the time of the Agreement II), pursuant to which Shaanxi Chaoyue, Ningxian Junong, Ningxian Jinnong and the Fruit Industry Bureau have agreed to establish a joint venture company in the PRC ("JV Company II") with a registered capital of RMB50 million and each of Shaanxi Chaoyue, Ningxian Junong, Ningxian Jinnong and the Fruit Industry Bureau has agreed to contribute RMB39 million, RMB2 million, RMB3 million and RMB6 million, respectively, to the registered capital of the JV Company II. Shaanxi Chaoyue, Ningxian Junong, Ningxian Jinnong and the Fruit Industry Bureau will own 78%, 4%, 6% and 12% of the equity interests of the JV Company II, respectively, after the capital contributions.
- On 16 April 2020, Shaanxi Chaoyue, a non-wholly owned subsidiary of the Company, entered into a joint venture agreement ("Agreement III") with 綏江縣中春農業綜合開 發有限公司 (Suijiang County Zhongchun Agriculture Development Company Limited*) ("Zhongchun Agriculture"), an independent third party at the time of the Agreement III, pursuant to which Shaanxi Chaoyue and Zhongchun Agriculture have agreed to establish a joint venture company in the PRC ("JV Company III") with a registered capital of RMB30 million and each of Shaanxi Chaoyue and Zhongchun Agriculture has agreed to contribute to the registered capital of the JV Company III at RMB21 million and RMB9 million, respectively. Shaanxi Chaoyue and Zhongchun Agriculture will own 70% and 30% of the equity interests of the JV Company III, respectively, after the capital contributions.
- For identification purpose only
Interim Report 2020 | 7 |
Management Discussion and Analysis
- On 7 May 2020, 威寧超越農業有限公司 (Weining Chaoyue Agriculture Company Limited*) ("Weining Chaoyue"), a non-wholly owned subsidiary of the Group, entered into a joint venture agreement ("Agreement IV") with 昭通市昭陽區農業投資發 展有限公司 (Zhaotong Zhaoyang Agricultural Investment Development Co., Ltd.*) ("Zhaoyang Agriculture"), a non-controlling shareholder of an indirectly non-wholly owned subsidiary of the Company , pursuant to which Weining Chaoyue and Zhaoyang Agriculture have agreed to establish a joint venture company in the PRC ("JV Company IV") with a registered capital of RMB50 million and each of Weining Chaoyue and Zhaoyang Agriculture has agreed to contribute to the registered capital of the JV Company IV at RMB15 million and RMB35 million, respectively. Weining Chaoyue and Zhaoyang Agriculture will own 30% and 70% of the equity interests of the JV Company IV, respectively, after the capital contributions.
Save as disclosed above, there were no significant investments held by the Company, nor were there any material acquisitions or disposals of subsidiaries, associates and joint ventures as of 30 June 2020.
Events after the Reporting Period
On 3 July 2020, Shaanxi Chaoyue, 武威市涼州區金希望農業發展有限公司 (Wuwei Liangzhou Golden Hope Agriculture Development Company Limited*) (previously known as 武威涼州農業產業扶貧開發有限責任公司) ("Wuwei Agriculture") and 武威海越現代農業 有限公司 (Wuwei Haiyue Modern Agriculture Company Limited*) ("Wuwei Haiyue") entered into a capital increase agreement (the "Capital Increase Agreement") pursuant to which Wuwei Agriculture has agreed to make a capital contribution to the registered capital of the Wuwei Haiyue so as to increase the registered capital of the Wuwei Haiyue from RMB213.0 million to RMB236.7 million.
Upon completion of the capital increase, each of Shaanxi Chaoyue and Wuwei Agriculture will hold approximately 90% and 10% equity interests in Wuwei Haiyue, respectively.
- For identification purpose only
8 China Haisheng Juice Holdings Co., Ltd.
Management Discussion and Analysis
Capital commitments
As at 30 June 2020, the Group has approximately RMB409.2 million capital commitments (as at 31 December 2019: RMB484.8 million).
Exposure to fluctuations in exchange rates
US dollar is one of the major settlement currencies for sales of the Group. The fluctuation of the exchange rate of US dollar against RMB during the period under review has no significant impact on the Group's financial position.
Pledge of assets
As at 30 June 2020, the Group pledged property, plant and equipment, bearer plants, prepaid lease payments, pledged bank deposits, inventories and value added tax recoverable for security of the Group's borrowings and obligation under finance lease with carrying account of approximately RMB2,442.0 million (as at 31 December 2019: RMB2,634.5 million).
Contingent Liabilities
The Group had no material contingent liabilities as at 30 June 2020.
Future plans for material investments and capital assets
At 30 June 2020, the Group did not have other plans for material investments or capital assets.
Interim Report 2020 | 9 |
Management Discussion and Analysis
Business review
Fruit drink processing
In the first half of 2020, the novel coronavirus ("COVID-19") pandemic had a huge impact on the global economy. Although our government formulated a series of measures which rapidly and effectively brought the pandemic under control, the adverse effects on various industries due to the suspension of work and production of many businesses during the initial period of the outbreak are difficult to eliminate in the short term.
Under the impact of the COVID-19 pandemic, the Group suspended production and operation for over a month with revenue from sales of juice concentrates decreased as compared with the same period of last year. In face of the pandemic, the management promptly formulated proactive response measures to ensure that the Group is able to go through such difficult times. Firstly, the Group adjusted its market structure amid an unstable international environment to mitigate the impacts of the pandemic and China-US trade tension. Meanwhile, it increased the gross profit of fruit juice processing through stringent cost control and improvement of product mix. Moreover, the Group strengthened management and control of expenses, and reduced administrative expenses.
During the reporting period, regarding end-user drinks, the Group reviewed market opportunities and adjusted brand strategy for end-user drinks. While optimizing and upgrading the "Eden View" juice drinks, the Group launched the "Pure Twig" and "Language of Fruit" drink series to satisfy different consumer groups and increase product penetration. Furthermore, the Group extended beyond traditional retail channels through cross-industry cooperation and promoting the positive image and value of its brands through multiple platforms in an effort to steadily expand end-user market.
10 China Haisheng Juice Holdings Co., Ltd.
Management Discussion and Analysis
Modernised agriculture
In recent years, the Group has expanded its agricultural business, and established a whole industrial chain structure including varieties selection, seedling breeding and building modern planting demonstration garden as well as operations of later stages such as sorting, packing and sales. The Group expanded the scale and distribution of its modernised planting bases in line with its strategic goals and unceasingly enhanced planting management standard and operation efficiency. As time goes by, the scale of the Group's agricultural assets increased and it biological assets have gradually matured with increasing productivity and sales performance. As a result, the Group's competitiveness in the fresh fruit market has gradually emerged.
The coronavirus pandemic led to the suspension of offline stores of most shopping malls and supermarkets during February and March 2020 in China. The Group's sales of fresh fruits were also affected. Nevertheless, the Group accelerated sales and expanded sales channels after resumption of work and production, and achieved remarkable results. During the reporting period, total revenue from sales of fresh fruit products increased 45% as compared with the same period of last year, of which revenue from sales of cherry tomatoes and apples increased over 82% and 62% respectively as compared with the same period of last year and revenue from sales of blue cherries was over 50 times of the same period of last year. During the reporting period, the Group focused on constructing the intelligent glass greenhouse projects in Jiangsu Province and Gansu Province. It is expected that 450,000 square metres of production area will be added to the glass greenhouse of the Group in this year, underpinning a good foundation for the future revenue growth.
In planting management, the Group tried for the first time to use drone remote sensing technology to carry out scientific, digital and refined management of the bases, which together with data analysis, enabled management plans to be adjusted and optimised timely, with expenses controlled reasonably, unit cost decreased and profitability increased. During the reporting period, the Group widely explored resources of foreign new varieties, and proactively selected premium varieties and registered 13 new cherry trademarks, 4 apple trademarks and 1 apple seedling trademark. The introduction of new varieties and registration of trademarks will provide quality and rare fresh fruit products to the domestic high-end fresh fruit market and enhance the competitiveness and brand influence of the Group's fresh fruit products.
Interim Report 2020 11
Management Discussion and Analysis
Regarding the expansion of sales channels, the Group actively promoted its star products "Pure Twig" and "Eden View" through online media, raising their market shares and brand recognition further, which also provided an effective support for the increase of product sales.
Prospect
According to the data published by National Bureau of Statistics, the spreading of the pandemic in China has been basically curbed and good progress is made in resumption of work and production. The impact of the pandemic on the economy of China is temporary and the long- term positive trend of its economy remained unchanged.
In the future, for fruit juice processing business, the Group will match changes of the market, increase investment in research and development, and keep on launching products that meet the market demand. Meanwhile, in line with its strategic goals the Group will promote the implementation of modernised agricultural projects, and constantly optimise products and management techniques to provide effective support for rapid development in agricultural business. As always, we firmly believe that with time and hard work, we will eventually reap fruitful results.
12 China Haisheng Juice Holdings Co., Ltd.
Other Information
Interim Dividend
The Board does not recommend the payment of an interim dividend for the six months ended 30 June 2020 (2019: Nil).
Purchase, Sale or Redemption of the Company's Listed Securities
There was no purchase, sale or redemption by the Company or any of its subsidiaries, of the Company's listed securities during the six months ended at 30 June 2020.
Directors' and Chief Executive's Interests and Short Position in Shares and Underlying Shares
As at 30 June 2020, the interests and short positions of the Directors and chief executive of the Company in the shares, underlying shares and debentures of the Company and its associated corporation (within the meaning of Part XV of the Securities and Futures Ordinance ("SFO")) as recorded in the register required to be kept by the Company pursuant to section 352 of the SFO, or as otherwise notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers ("Model Code") in the Listing Rules, were as follows:
Interim Report 2020 13
Other Information
Long position
Number and class | Approximate | |||||
Name of | of securities directly | percentage of | ||||
Name | the company | Capacity | or indirectly held | shareholding | ||
(Note 3) | ||||||
Mr. Gao Liang | The Company | Beneficial owner | 8,600,000 | Shares | 0.67% | |
Interest of controlled | ||||||
corporation | 459,061,238 | Shares(Note 1) | 35.59% | |||
Interest of spouse | 4,724,660 | Shares(Note 2) | 0.37% | |||
472,385,898 | Shares | 36.63% | ||||
Notes:
- As at 30 June 2020, the 459,061,238 Shares were held by Think Honour International Limited ("Think Honour"), the entire issued share capital of which was held by Mr. Gao Liang. Accordingly, Mr. Gao Liang was deemed to be interested in the 459,061,238 Shares held by Think Honour by virtue of the SFO.
- As at 30 June 2020, the 4,724,660 shares were held by Ms. Xie Haiyan who is the spouse of Mr. Gao Liang. Accordingly, Mr. Gao Liang was deemed to be interested in the 4,724,660 Shares held by Ms. Xie Haiyan.
- The percentage was compiled based on the total number of issued shares of the Company as at 30 June 2020 (i.e. 1,289,788,000 ordinary shares).
Save as disclosed above, as at 30 June 2020, none of the Directors or chief executive of the Company had any interest or short position in the shares, underlying shares and debentures of the Company and its associated corporation that was required to be recorded pursuant to section 352 of the SFO, or as otherwise notified to the Company and the Stock Exchange pursuant to the Model Code.
14 China Haisheng Juice Holdings Co., Ltd.
Other Information
Substantial Shareholders' and Other Person's Interests in Shares and Underlying Shares
As at 30 June 2020, the interests and short positions of every person, other than a Director or chief executive of the Company, in the shares and underlying shares of the Company as recorded in the register required to be kept by the Company pursuant to section 336 of the SFO were as follows:
Number and class | Approximate | ||||||
Name of | of securities directly | percentage of | |||||
Name | the company | Capacity | or indirectly held | shareholding | |||
(Note 4) | |||||||
Ms. Xie Haiyan | The Company | Interest of spouse | 467,661,238 | Shares(Note 1) | 36.26% | ||
Beneficial owner | 4,724,660 | Shares(Note 2) | 0.37% | ||||
472,385,898 Shares | 36.63% | ||||||
Think Honour | The Company | Beneficial owner | 459,061,238 | Shares(Note 2) | 35.59% | ||
Tiandi Yihao Beverage | The Company | Interest of controlled | 227,996,000 | Shares(Note 3) | 17.68% | ||
Co., Ltd. | corporation | ||||||
Shenzhen Tiandi Win-Win | The Company | Interest of controlled | 227,996,000 | Shares(Note 3) | 17.68% | ||
Investment Management | corporation | ||||||
Co., Limited | |||||||
Tiandi Win-Win Investment | The Company | Beneficial owner | 227,996,000 | Shares(Note 3) | 17.68% | ||
Management Co., Limited |
Interim Report 2020 15
Other Information
Notes:
- Ms. Xie Haiyan is the spouse of Mr. Gao Liang. Ms. Xie Haiyan is deemed to be interested in the 467,661,238 shares in which Mr. Gao Liang is deemed to be interested by virtue of the SFO.
- The entire issued share capital of Think Honour was held by Mr. Gao Liang.
- Tiandi Win-Win Investment Management Co., Limited is a wholly-owned subsidiary of Shenzhen Tiandi Win-Win Investment Management Co., Limited which is a wholly-owned subsidiary of Tiandi Yihao Beverage Co., Ltd. Pursuant to the SFO, Shenzhen Tiandi Win-Win Investment Management Co., Limited and Tiandi Yihao Beverage Co., Ltd. are deemed to be interested in the 227,996,000 Shares held by Tiandi Win-Win Investment Management Co., Limited.
- The percentage was compiled based on the total number of issued shares of the Company as at 30 June 2020 (i.e. 1,289,788,000 ordinary shares).
Save as disclosed above, as at 30 June 2020, the Directors or chief executive of the Company were not aware of any other person or parties having an interest and/or short positions in the shares or underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or which were recorded in the register required to be kept by the Company pursuant to section 336 of the SFO.
Corporate Governance Practices
During the six months ended 30 June 2020, The Company has complied, saved for the deviations discussed below, with the principles and provisions as set out in the code provisions contained in the Corporate Governance Code (which is set out in the Appendix 14 of the Listing Rules) by establishing formal and transparent procedures to protect and maximise the interests of shareholders of the Company during the period under review.
16 China Haisheng Juice Holdings Co., Ltd.
Other Information
Code Provision A.2.1 providing for the roles of the chairman and chief executive officer (or chief executive) to be performed by different individuals (the "First Deviation"). At present, the Company does not have a competent candidate for the position of chief executive officer. Mr. Gao Liang, therefore, acts as the chairman and chief executive officer of the Company. Code Provision A.6.7 (the "Second Deviation") providing for the independent non-executive directors ("INED(s)") of the Company, inter alia, attend general meetings. Code Provision E.1.2 (the "Third Deviation") providing for the chairman of the board (the "Chairman") to attend the annual general meeting of the Company (the "AGM") and to invite the chairman of audit, remuneration and nomination committees to attend. Regarding the Second Deviation and the Third Deviation, the Chairman and two INEDs, namely Mr. Zhao Boxiang (chairman of remuneration committee) and Ms. Huang Liqiong (chairman of audit committee), were absent from the last annual general meeting of the Company held on 22 June 2020 due to their other important engagements at the relevant time.
Compliance of the Model Code for Securities
The Company has adopted the Model Code set out in Appendix 10 to the Listing Rules as its own code of conduct regarding Directors' securities transactions. All Directors have confirmed, following specific enquiry by the Company, that they have complied with the required standards set out in the Model Code throughout the review period.
Directors' Interests in a Competing Business
None of the Directors or their respective associates has any competing interests which need to be disclosed pursuant to Rule 8.10 of the Listing Rules.
Interim Report 2020 17
Other Information
Staff and Remuneration Policies
As at 30 June 2020, the Group had 2,830 (as at 31 December 2019: 3,199) employees. The Group mainly determines staff remuneration in accordance with market terms and individual qualifications.
The emoluments of the Directors are reviewed and recommended by the remuneration committee, and decided by the Board, as authorised by the shareholders at the annual general meeting, in accordance with the Group's operating results, individual performance and comparable market statistics.
Review of Results by Audit Committee
The unaudited interim results for the six months ended 30 June 2020 was reviewed by the audit committee of the Company.
By order of the Board
China Haisheng Juice Holding Co., Ltd
Mr. Gao Liang
Chairman
Xi'an, the People's Republic of China, 28 August, 2020
18 China Haisheng Juice Holdings Co., Ltd.
Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income
For the six months ended 30 June 2020 | |||
(Unaudited) | |||
Six months ended 30 June | |||
2020 | 2019 | ||
NOTES | RMB'000 | RMB'000 | |
Revenue | 4 | 425,055 | 503,412 |
Cost of sales | (334,203) | (363,684) | |
Gross profit | 90,852 | 139,728 | |
Other income | 96,516 | 111,461 | |
Other gains and losses | 3,104 | 5,357 | |
Impairment losses for trade receivables | (1,815) | - | |
Change in fair value due to biological | |||
transformation | 43,056 | - | |
Distribution and selling expenses | (100,817) | (129,866) | |
Administrative expenses | (113,537) | (126,364) | |
Other operating expenses | (23,751) | (2,945) | |
Finance costs | (78,217) | (73,595) | |
Share of results of an associate | (11) | (226) | |
Loss before taxation | (84,620) | (76,452) | |
Taxation | 6 | (3,938) | (4,187) |
Loss for the period | 7 | (88,558) | (80,639) |
Other comprehensive expense | |||
Items that may be reclassified subsequently | |||
to profit or loss: | |||
Exchange difference arising on | |||
translation of foreign operations | (158) | (94) | |
Other comprehensive expense for the period | (158) | (94) | |
Total comprehensive expense for the period | (88,716) | (80,733) | |
Interim Report 2020 19
Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income
For the six months ended 30 June 2020
(Unaudited) | |||
Six months ended 30 June | |||
2020 | 2019 | ||
NOTES | RMB'000 | RMB'000 | |
Loss for the period attributable to: | |||
Owners of the Company | (85,797) | (79,922) | |
Non-controlling interests | (2,761) | (717) | |
(88,558) | (80,639) | ||
Total comprehensive expense attributable to: | |||
Owners of the Company | (85,955) | (80,016) | |
Non-controlling interests | (2,761) | (717) | |
(88,716) | (80,733) | ||
Dividends | 8 | - | - |
Loss per share (RMB cents) | |||
Basic and diluted | 9 | (6.65) cents | (6.20) cents |
20 China Haisheng Juice Holdings Co., Ltd.
Condensed Consolidated Statement of Financial Position
At 30 June 2020 | |||
30 June | 31 December | ||
2020 | 2019 | ||
(Unaudited) | (Audited) | ||
NOTES | RMB'000 | RMB'000 | |
NON-CURRENT ASSETS | |||
Property, plant and equipment | 10 | 4,043,795 | 3,655,665 |
Right-of-use assets | 1,896,786 | 1,843,999 | |
Bearer plants | 11 | 1,952,976 | 1,504,886 |
Investment in an associate | 7,442 | 7,453 | |
Biological assets | 68,426 | 69,336 | |
Prepayments for acquisition of bearer plants | 23,372 | 30,156 | |
Deposits for acquisition of property, plant | |||
and equipment | 119,747 | 30,598 | |
Total non-current assets | 8,112,544 | 7,142,093 | |
CURRENT ASSETS | |||
Biological assets | 42,340 | 40,679 | |
Inventories | 12 | 658,737 | 780,393 |
Trade and other receivables | 13 | 485,926 | 408,349 |
Amounts due from related companies | 164 | 164 | |
Pledged bank deposits | 55,809 | 144,320 | |
Bank balances and cash | 396,400 | 170,972 | |
Total current assets | 1,639,376 | 1,544,877 | |
CURRENT LIABILITIES | |||
Trade and other payables | 14 | 1,653,630 | 1,469,646 |
Bills payables | 87,899 | 186,000 | |
Current tax liabilities | 1,000 | 1,221 | |
Dividend payable to non-controlling | |||
shareholders of a subsidiary | 63 | 63 | |
Bank and other borrowings | 1,715,175 | 1,422,631 | |
Lease liabilities | 142,927 | 185,866 | |
Deferred government grants | 3,574 | 15,134 | |
Total current liabilities | 3,604,268 | 3,280,561 | |
Interim Report 2020 21
Condensed Consolidated Statement of Financial Position
At 30 June 2020
30 June | 31 December | |
2020 | 2019 | |
(Unaudited) | (Audited) | |
NOTES | RMB'000 | RMB'000 |
Net current liabilities | (1,964,892) | (1,735,684) |
Total assets less current liabilities | 6,147,652 | 5,406,409 |
NON-CURRENT LIABILITIES | ||
Bank and other borrowings | 2,900,033 | 2,178,795 |
Lease liabilities | 881,785 | 986,752 |
Deferred government grants | 225,430 | 213,986 |
Deferred tax liabilities | 31,536 | 31,536 |
Total non-current liabilities | 4,038,784 | 3,411,069 |
NET ASSETS | 2,108,868 | 1,995,340 |
CAPITAL AND RESERVES | ||
Equity attributable to owners | ||
of the Company | ||
Share capital | 13,296 | 13,296 |
Reserves | 1,124,214 | 1,162,422 |
1,137,510 | 1,175,718 | |
Non-controlling interests | 971,358 | 819,622 |
TOTAL EQUITY | 2,108,868 | 1,995,340 |
22 China Haisheng Juice Holdings Co., Ltd.
Condensed Consolidated Statement of Changes in Equity
For the six months ended 30 June 2020
Attributable to Owners of the Company | |||||||||||
Share | Statutory | Non- | |||||||||
Share | Share | option | Special | Translation | surplus | Other | Retained | controlling | Total | ||
capital | premium | reserve | reserve | reserve | reserve | reserve | profits | Total | interests | equity | |
RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | |
At 1 January 2019 (audited) | 13,296 | 212,838 | - | 258,722 | (191) | 220,098 | (13,426) | 548,927 | 1,240,264 | 580,447 | 1,820,711 |
Loss for the period (unaudited) | - | - | - | - | - | - | - | (79,922) | (79,922) | (717) | (80,639) |
Exchange differences arising on | |||||||||||
translation of foreign operations | |||||||||||
(unaudited) | - | - | - | - | (94) | - | - | - | (94) | - | (94) |
Total comprehensive income/ | |||||||||||
(expense) for the period | |||||||||||
(unaudited) | - | - | - | - | (94) | - | - | (79,922) | (80,016) | (717) | (80,733) |
Contribution from minority | |||||||||||
shareholder of subsidiaries | |||||||||||
(unaudited) | - | - | - | - | - | - | - | - | - | 100,688 | 100,688 |
Change in ownership interest in | |||||||||||
subsidiaries without loss of | |||||||||||
control (unaudited) | - | - | - | - | - | - | 33,778 | - | 33,778 | - | 33,778 |
Appropriated from accumulated | |||||||||||
profits (unaudited) | - | - | - | - | - | - | - | - | - | - | - |
At 30 June 2019 (unaudited) | 13,296 | 212,838 | - | 258,722 | (285) | 220,098 | 20,352 | 469,005 | 1,194,026 | 680,418 | 1,874,444 |
Interim Report 2020 23
Condensed Consolidated Statement of Changes in Equity
For the six months ended 30 June 2020
Attributable to Owners of the Company | |||||||||||
Share | Statutory | Non- | |||||||||
Share | Share | option | Special | Translation | surplus | Other | Retained | controlling | Total | ||
capital | premium | reserve | reserve | reserve | reserve | reserve | profits | Total | interests | equity | |
RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | |
At 1 January 2020 (audited) | 13,296 | 212,838 | - | 258,722 | (146) | 245,960 | (13,426) | 458,474 | 1,175,718 | 819,622 | 1,995,340 |
Loss for the period (unaudited) | |||||||||||
- | - | - | - | - | - | - | (85,797) | (85,797) | (2,761) | (88,558) | |
Exchange differences arising on | |||||||||||
translation of foreign operations | |||||||||||
(unaudited) | - | - | - | - | (158) | - | - | - | (158) | - | (158) |
Total comprehensive income/ | |||||||||||
(expense) for the period | |||||||||||
(unaudited) | - | - | - | - | (158) | - | - | (85,797) | (85,955) | (2,761) | (88,716) |
Contribution from minority | |||||||||||
shareholder | |||||||||||
of subsidiaries (unaudited) | - | - | - | - | - | - | 47,747 | - | 47,747 | 154,497 | 202,244 |
Change in ownership interest in | |||||||||||
subsidiaries without loss of | |||||||||||
control (unaudited) | - | - | - | - | - | - | - | - | - | - | - |
Appropriated from accumulated | |||||||||||
profits (unaudited) | - | - | - | - | - | - | - | - | - | - | - |
At 30 June 2020 (unaudited) | |||||||||||
13,296 | 212,838 | - | 258,722 | (304) | 245,960 | 34,321 | 372,677 | 1,137,510 | 971,358 | 2,108,868 | |
24 China Haisheng Juice Holdings Co., Ltd.
Condensed Consolidated Statement of Cash Flows
For the six months ended 30 June 2020
(Unaudited)
Six months ended 30 June
20202019
RMB'000 RMB'000
Net cash generated from operating activities
Net cash used in investing activities Purchases of property, plant and equipment Purchases of bearer plants
Payments for right-of-use assets Decrease in pledged bank deposits Other investing activities
Net cash generated from financing activities New bank and other borrowings raised Repayment of bank and other borrowings Payments of lease liabilities
Capital contributions from non-controlling interests Interest paid on bank and other borrowings Other financing activities
Increase in cash and cash equivalents
Effect of foreign exchange rate changes
Cash and cash equivalent at 1 January
Cash and cash equivalent at 30 June, representing bank balances and cash
208,436 | 187,943 |
(527,472) | (636,550) |
(443,135) | (108,313) |
(135,557) | - |
88,511 | 86,923 |
5,776 | 4,008 |
(1,011,877) | (653,932) |
1,279,784 | 1,627,018 |
(266,002) | (976,666) |
(79,261) | (216,540) |
202,244 | 134,466 |
(108,030) | (85,536) |
- | 50,495 |
1,028,735 | 533,237 |
225,294 | 67,248 |
134 | - |
170,972 | 309,033 |
396,400 | 376,281 |
Interim Report 2020 25
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended 30 June 2020
1. GENERAL
The Company is incorporated in the Cayman Islands as an exempted company with limited liability. The address of the registered office of the Company is Cricket Square, Hutchins Drive, P.O. Box 2681, Grand Cayman KY1-1111, the Cayman Islands and its principal place of business in Hong Kong is located at Room B, 3/F., Eton Building, 288 Des Voeux Road Central, Hong Kong. The Company's shares are listed on the Main Board of The Stock Exchange of Hong Kong Limited (the "Stock Exchange").
The Company is an investment holding company while its subsidiaries are principally engaged in (i) the manufacture and sale of fruit juice concentrate and related products and (ii) plantation and sale of apples, apple saplings and other fruits.
The Group's principal operations are conducted in the People's Republic of China (the "PRC"). The condensed consolidated interim financial statements are presented in Chinese Renminbi ("RMB"), which is also the functional currency of the Company.
2. PREPARATION OF THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
- Basis of preparation
These condensed consolidated interim financial statements have been prepared in accordance with the applicable disclosure requirements of Appendix 16 to the Rules Governing the Listing of Securities on the Stock Exchange (the "Listing Rule") and with International Accounting Standard 34 (IAS 34) "Interim Financial Reporting".
- Going concern
The Group incurred an unaudited net loss of approximately RMB85,797,000 during the period ended 30 June 2020 and, as of that date, the Group had unaudited net current liabilities of approximately RMB1,964,892,000. This condition indicates the existence of a material uncertainty which may cast significant doubt on the Group's ability to continue as a going concern. Therefore, the Group may be unable to realise its assets and discharge its liabilities in normal course of business.
26 China Haisheng Juice Holdings Co., Ltd.
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended 30 June 2020
The Group continues to adopt the going concern basis in preparing these condensed consolidated interim financial statements. The Group meets its day- to-day working capital requirements through its bank facilities. Most of the bank borrowings as at 30 June 2020 that are repayable within the next 12 months are subject to renewal and the directors are confident that these borrowings can be renewed upon expiration based on the Group's past experience and credit history.
The current economic conditions continue to create uncertainty particularly over (a) the level of demand for the Group's products; and (b) the availability of bank and other finance for the foreseeable future. In order to strengthen the Group's liquidity in the foreseeable future, the Group has taken the following measures:
- negotiating with banks and other financial institutions in advance for renewal and obtaining new banking facilities;
- the directors of the Company have been taking various cost control measures to tighten the costs of operations; and
- the Group has been implementing various strategies to enhance the Group's revenue and profitability.
The Group's forecasts and projections, taking account of reasonably possible changes in trading performance, show that the Group should be able to operate within the level of its current facilities. After making enquiries, the directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future.
3. PRINCIPAL ACCOUNTING POLICIES
The accounting policies used in the preparation of the condensed consolidated interim financial statements are consistent with those used in the annual financial statements for the financial year ended 31 December 2019, except for the adoption of the standards, amendments and interpretations issued by the IASB mandatory for annual periods beginning 1 January 2020. The effect of the adoption of these standards, amendments and interpretations was not material to the Group's results of operations or financial position.
Interim Report 2020 27
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended 30 June 2020
4. REVENUE
The following is analysis of the Group's revenue for the six months ended 30 June 2020:
Revenue from external customers
(Unaudited)
Six months ended 30 June
20202019
RMB'000 RMB'000
Sale of fruit juice concentrate and related | ||
products | 205,672 | 300,750 |
Sale of apples, apple saplings and other fruits | 219,383 | 202,662 |
425,055 | 503,412 | |
5. SEGMENT INFORMATION
The Group has two operating segments as follows:
Fruit juice operation - Manufacture and sale of fruit juice concentrate and related products
Agriculture operation - Plantation and sale of apples, apple saplings and other fruits
The Group's reportable segments are strategic business units that offer different products and services. They are managed separately because each business requires different technology and marketing strategies.
The accounting policies of the operating segments are the same as the Group's accounting policies. Segment profits or losses do not include other income, share of loss of an associate, unallocated other gains and losses, administrative expenses, finance costs and income tax expense.
The Group accounts for intersegment sales and transfers as if the sales or transfers were to third parties, i.e. at current market prices.
28 China Haisheng Juice Holdings Co., Ltd.
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended 30 June 2020
Information about operating segment profit or loss:
Fruit juice operation | Agriculture operation | Total | ||||
(Unaudited) | (Unaudited) | (Unaudited) | ||||
Six months ended 30 June | Six months ended 30 June | Six months ended 30 June | ||||
2020 | 2019 | 2020 | 2019 | 2020 | 2019 | |
RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | RMB'000 | |
Segment revenue | ||||||
Revenue from external customers | 205,672 | 300,750 | 219,383 | 202,662 | 425,055 | 503,412 |
Intersegment revenue | - | - | 155 | 260 | 155 | 260 |
Reportable segment revenue | 205,672 | 300,750 | 219,538 | 202,922 | 425,210 | 503,672 |
Less: intersegment revenue | (155) | (260) | ||||
Consolidated revenue | 425,055 | 503,412 | ||||
Segment results | (56,361) | (28,213) | (29,898) | (64,427) | (86,259) | (92,640) |
Other income | 96,516 | 111,461 | ||||
Share of loss of an associate | (11) | (226) | ||||
Unallocated amounts: | ||||||
Other gains and losses | - | (12) | ||||
Administrative expenses | (16,649) | (21,440) | ||||
Finance costs | (78,217) | (73,595) | ||||
Consolidated loss before tax | (84,620) | (76,452) | ||||
Interim Report 2020 29
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended 30 June 2020
Geographical information:
The Group's operations are mainly located in the PRC.
The Group's revenue from external customers by location of customers and information about its non-current assets by location of assets are detailed below:
Revenue from external | ||||
customers | Non-current assets | |||
(Unaudited) | (Unaudited) | (Audited) | ||
Six months ended 30 June | 30 June | 31 December | ||
2020 | 2019 | 2020 | 2019 | |
RMB'000 | RMB'000 | RMB'000 | RMB'000 | |
United States of America | ||||
(the "USA") | 35,124 | 40,720 | 1,535 | 1,547 |
Canada | 1,436 | 2,817 | - | - |
PRC | 306,416 | 345,935 | 8,111,009 | 7,140,546 |
South Africa | 89 | 5,743 | - | - |
Saudi Arabia | 8,561 | 8,716 | - | - |
Japan | 49,385 | 59,100 | - | - |
Australia | 587 | 11,068 | - | - |
Russia | 8,551 | 14,223 | - | - |
Others | 14,906 | 15,091 | - | - |
425,055 | 503,412 | 8,112,544 | 7,142,093 | |
30 China Haisheng Juice Holdings Co., Ltd.
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended 30 June 2020
Information about major products:
(Unaudited) | ||
Six months ended 30 June | ||
2020 | 2019 | |
RMB'000 | RMB'000 | |
Apple juice | 112,357 | 165,240 |
Other juice | 93,315 | 135,510 |
Fresh fruits | 204,480 | 141,496 |
Apple saplings | 6,260 | 46,800 |
Others | 8,643 | 14,366 |
425,055 | 503,412 | |
Information of assets and liabilities for operating segments are not provided to the Company's directors, being the chief operating decision maker, for their review. Therefore, no analysis of the Group's assets and liabilities by operating segments are presented.
Interim Report 2020 31
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended 30 June 2020
6. INCOME TAX EXPENSE
(Unaudited) | ||
Six months ended 30 June | ||
2020 | 2019 | |
RMB'000 | RMB'000 | |
Current tax | ||
PRC Enterprise Income tax ("EIT") | 3,928 | 3,608 |
Other jurisdiction | 10 | 579 |
3,938 | 4,187 | |
Deferred tax | - | - |
3,938 | 4,187 | |
The Company is not subject to taxation in the Cayman Islands, which does not levy tax on the income of the Company. No provision for Hong Kong Profits Tax has been made as the Group's income neither arises in, nor is derived from Hong Kong.
Under the Law of the PRC on EIT (the "EIT Law") and Implementation Regulation of the EIT Law, the tax rate of the PRC subsidiaries is 25%. Pursuant to the relevant regulations applicable to enterprises situated in the western regions of the PRC, the PRC subsidiaries enjoy a preferential tax rate of 15% for 2018 and 2019. The PRC subsidiaries need to apply for the preferential tax rate every year. The PRC subsidiaries will need to apply for the preferential tax rate for 2020.
32 China Haisheng Juice Holdings Co., Ltd.
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended 30 June 2020
According to relevant EIT Law and Implementation Regulation of the EIT Law, certain subsidiaries in fruit juice operation of the Group in the PRC are exempted from EIT on profits derived from preliminary processing of agriculture products for the years ended 31 December 2018 and 2019, subject to annual review by the local PRC tax authority of the Company's subsidiaries and any future changes in the relevant tax exemption policies or regulations. The PRC subsidiaries will need to apply for the exemption of EIT for 2020.
According to relevant EIT Law and Implementation Regulation of the EIT Law, certain subsidiaries in agriculture operation of the Group in the PRC are exempted from EIT on profits derived from fruits cultivation for the years ended 31 December 2018 and 2019, subject to annual review by the local PRC tax authority of the Company's subsidiaries and any future changes in the relevant tax exemption policies or regulations. The PRC subsidiaries will need to apply for the exemption of EIT for 2020.
A subsidiary of the Company, Haisheng International Inc., is a limited liability company incorporated in the USA on 21 January 2005 and is subject to corporate and federal tax at progressive rates from 15% to 35%.
Interim Report 2020 33
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended 30 June 2020
7. LOSS FOR THE PERIOD
Loss for the period has been arrived at after charging (crediting):
(Unaudited) | ||||
Six months ended 30 June | ||||
2020 | 2019 | |||
RMB'000 | RMB'000 | |||
Directors' emoluments | ||||
1,193 | 1,248 | |||
Salaries, wages and other benefits | 160,202 | 140,676 | ||
Retirement benefits scheme contributions | 10,409 | 15,883 | ||
Share-based payment expenses | - | - | ||
Total staff costs | 171,804 | 157,807 | ||
Less: staff costs capitalised into inventories | (13,188) | (20,053) | ||
Less: staff cost capitalised into cost | ||||
of bearer plant | (32,739) | (33,750) | ||
125,877 | 104,004 | |||
Amortisation of right-of-use assets | ||||
20,829 | 8,414 | |||
Less: amount capitalised into cost of bearer | ||||
plants/biological assets | (20,829) | (6,268) | ||
- | 2,146 | |||
Depreciation of property, plant and equipment | ||||
67,674 | 62,932 | |||
Less: amount capitalised into cost of bearer | ||||
plants/biological assets | (24,913) | (22,902) | ||
42,761 | 40,030 | |||
Operating lease charges for land and buildings | - | 2,099 | ||
Depreciation of bearer plants | 10,374 | 1,262 | ||
Cost of inventories sold | 334,203 | 363,684 | ||
Loss on disposals of property, plant and | ||||
equipment | 6,518 | 1,170 | ||
34 China Haisheng Juice Holdings Co., Ltd.
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended 30 June 2020
8. DIVIDEND
The Board does not recommend the payment of an interim dividend for the six months ended 30 June 2020 (2019: Nil).
9. LOSS PER SHARE
The calculation of basic loss per share attributable to owners of the Company is based on the unaudited loss for the period attributable to owners of the Company of approximately RMB85,797,000 (2019: RMB79,922,000) and the weighted average number of ordinary shares of 1,289,788,000 (2019: 1,289,788,000) in issue during the period.
As there are no dilutive potential ordinary shares as at 30 June 2019 and 30 June 2020, the diluted loss per share is equal to the basic loss per share.
10. PROPERTY, PLANT AND EQUIPMENT
During the period under review, the Group incurred approximately RMB465,641,000 on acquisition of property, plant and equipment.
11. BEARER PLANTS
During the period under review, the Group incurred approximately RMB525,253,000 on acquisition of bearer plants.
12. INVENTORIES
30 June | 31 December | |
2020 | 2019 | |
RMB'000 | RMB'000 | |
(Unaudited) | (audited) | |
Raw materials and consumables | 190,038 | 255,398 |
Work in progress | 158,186 | 106,923 |
Finished goods | 310,513 | 418,072 |
658,737 | 780,393 | |
Interim Report 2020 35
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended 30 June 2020
13. TRADE AND OTHER RECEIVABLES
30 June | 31 December | |
2020 | 2019 | |
RMB'000 | RMB'000 | |
(Unaudited) | (audited) | |
Trade receivables | 207,384 | 178,310 |
Less: allowance for doubtful debts | (5,095) | (3,280) |
202,289 | 175,030 | |
Bills receivable | 910 | 1,084 |
Value added tax recoverable and other tax | ||
recoverable | 36,342 | 42,690 |
Receivable from disposal of saplings | - | - |
Advances to suppliers | 17,366 | 22,150 |
Other receivables, deposits and prepayments | 229,019 | 167,395 |
485,926 | 408,349 | |
Note: As at 30 June 2020, value added tax recoverable and deposit and other receivables of approximately RMBNil (31 December 2019: RMBNil) and RMB11,392,000 (31 December 2019: RMB12,452,000) were pledged as securities for lease liabilities and bank and other borrowings respectively.
The Group's trading terms with customers are mainly on credit. The credit terms generally range from 30 to 90 days. Each customer has a maximum credit limit. For new customers, payment in advance is normally required. The Group seeks to maintain strict control over its outstanding receivables. Overdue balances are reviewed regularly by the directors.
36 China Haisheng Juice Holdings Co., Ltd.
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended 30 June 2020
The ageing analysis of trade receivables, based on the invoice date, and net of allowance, is as follows:
30 June | 31 December | |
2020 | 2019 | |
RMB'000 | RMB'000 | |
(Unaudited) | (Audited) | |
0 to 90 days | 163,034 | 145,246 |
91-180 days | 19,087 | 18,528 |
181 to 365 days | 11,771 | 7,578 |
Over 1 year | 8,397 | 3,678 |
202,289 | 175,030 | |
14. TRADE AND OTHER PAYABLES
30 June | 31 December | |
2020 | 2019 | |
RMB'000 | RMB'000 | |
(Unaudited) | (Audited) | |
Trade payables | 675,608 | 708,368 |
Payable for acquisition of property, plant and | ||
equipment | 287,037 | 295,072 |
Contract liabilities | 134,577 | 81,889 |
Accrued salaries | 72,698 | 70,945 |
Accrued interest | 28,406 | 13,158 |
Value added tax and other tax payables | 4,755 | 11,399 |
Other payables and accruals | 450,549 | 288,815 |
1,653,630 | 1,469,646 | |
Less: other liabilities - non-current portion | - | - |
1,653,630 | 1,469,646 | |
Interim Report 2020 37
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended 30 June 2020
The Group is allowed a credit period ranged from 90 to 180 days from its suppliers. The ageing analysis of trade payables, based on the date of receipt of goods, is as follows:
30 June | 31 December | |
2020 | 2019 | |
RMB'000 | RMB'000 | |
(Unaudited) | (Audited) | |
0 to 90 days | 226,723 | 361,690 |
91-180 days | 96,256 | 160,162 |
181 to 365 days | 222,455 | 65,007 |
Over 1 year | 130,174 | 121,509 |
675,608 | 708,368 | |
15. CAPITAL COMMITMENTS
Capital commitments contracted for at the end of the reporting period but not yet incurred are as follows:
30 June | 31 December | |
2020 | 2019 | |
RMB'000 | RMB'000 | |
(Unaudited) | (Audited) | |
Property, plant and equipment | 290,955 | 412,882 |
Bearer plants | 88,839 | 42,543 |
Capital contribution to an associate | 29,400 | 29,400 |
409,194 | 484,825 | |
38 China Haisheng Juice Holdings Co., Ltd.
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