广西能源(600310) - 2018 Q2 - 季度财报

Part I Definitions of Common Terms This chapter defines common terms used in the report, including company names, related party names, subsidiary names, and reporting period definitions, to ensure clear understanding of the content - “Company,” “the Company,” and “Guidong Electric Power” all refer to Guangxi Guidong Electric Power Co., Ltd[11] - The “reporting period” refers to January-June 2018[11] Part II Company Information This chapter presents the company's basic registration information, including its Chinese name, abbreviation, foreign name, and legal representative - The company's Chinese name is Guangxi Guidong Electric Power Co., Ltd., abbreviated as Guidong Electric Power, with Qin Min as its legal representative[14] Contact Person and Contact Information This chapter provides contact information for the company's Board Secretary and Securities Affairs Representative, including names, addresses, phone numbers, faxes, and email addresses - The Board Secretary is Lu Peijun, and the Securities Affairs Representative is Liang Sheng, both located at No. 12 Pingan West Road, Hezhou City, Guangxi[15] Brief Introduction to Changes in Basic Information This chapter discloses basic company information such as registered address, office address, postal code, and company website - The company's registered and office address is No. 12 Pingan West Road, Hezhou City, Guangxi, postal code 542899[16] Brief Introduction to Changes in Information Disclosure and Document Storage Locations This chapter specifies the designated newspapers and website for company information disclosure, as well as the report storage location - The company's designated newspapers for information disclosure are "Shanghai Securities News" and "Securities Daily," and the designated website is www.sse.com.cn[17](index=17&type=chunk) Brief Introduction to Company Shares This chapter introduces the company's stock type, listing exchange, stock abbreviation, and code - The company's A-shares are listed on the Shanghai Stock Exchange, with stock abbreviation “Guidong Electric Power” and stock code 600310[18] Key Accounting Data and Financial Indicators During the reporting period, the company's operating revenue significantly increased, but net profit attributable to shareholders and non-recurring net profit sharply declined, primarily due to reduced self-generated power, increased purchased power, and electricity price reduction policies Key Accounting Data | Key Accounting Data | This Reporting Period (Jan-Jun) | Same Period Last Year | Change from Same Period Last Year (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 6,558,474,962.18 | 4,085,752,565.60 | 60.52 | | Net Profit Attributable to Listed Company Shareholders | 2,345,682.67 | 5,521,622.34 | -57.52 | | Net Profit Attributable to Listed Company Shareholders After Deducting Non-recurring Gains and Losses | -330,036.05 | 1,595,869.41 | -120.68 | | Net Cash Flow from Operating Activities | -43,362,646.56 | -247,772,810.42 | N/A | | End of This Reporting Period | End of Last Year | Change from End of Last Year (%) | | | Net Assets Attributable to Listed Company Shareholders | 1,778,342,584.72 | 2,038,565,512.71 | -12.77 | | Total Assets | 13,849,005,018.45 | 12,753,786,654.20 | 8.59 | Key Financial Indicators | Key Financial Indicators | This Reporting Period (Jan-Jun) | Same Period Last Year | Change from Same Period Last Year (%) | | :--- | :--- | :--- | :--- | | Basic Earnings Per Share (Yuan/share) | 0.0028 | 0.0067 | -58.21 | | Diluted Earnings Per Share (Yuan/share) | 0.0028 | 0.0067 | -58.21 | | Basic Earnings Per Share After Deducting Non-recurring Gains and Losses (Yuan/share) | -0.0004 | 0.0019 | -121.05 | | Weighted Average Return on Net Assets (%) | 0.11 | 0.21 | Decrease of 0.10 percentage points | | Weighted Average Return on Net Assets After Deducting Non-recurring Gains and Losses (%) | -0.02 | 0.06 | Decrease of 0.08 percentage points | - The increase in operating revenue was primarily due to the expanded sales scale of wholly-owned subsidiaries Guangxi Yongsheng and Guisheng Company[21] - The year-on-year decrease in net profit was mainly due to a reduction in highly profitable self-generated power, an increase in higher-cost purchased power, and electricity price reduction policies leading to decreased gross profit from the main power business[21] Non-recurring Gains and Losses Items and Amounts This chapter discloses the detailed composition and amount of non-recurring gains and losses during the reporting period, totaling 2,675,718.72 yuan Non-recurring Gains and Losses Items | Non-recurring Gains and Losses Items | Amount (Yuan) | Notes (if applicable) | | :--- | :--- | :--- | | Gains or losses from disposal of non-current assets | 129,643.29 | | | Government grants recognized in current profit or loss | 732,540.68 | | | Gains or losses from changes in fair value of trading financial assets and liabilities, and investment income from disposal of trading financial assets, liabilities, and available-for-sale financial assets | -526,767.88 | | | Other non-operating income and expenses apart from the above | 3,940,234.02 | Income from liquidated damages, etc | | Impact on minority interests | -716,988.15 | | | Income tax impact | -882,943.24 | | | Total | 2,675,718.72 | | Part III Main Business, Operating Model, and Industry Situation The company's main businesses are power generation and sales, and oil product trading; the power business benefits from a "generation-grid integration" advantage but is significantly affected by natural climate, while the oil product trading business actively expands its market and industry chain - The company's main businesses are power generation and sales, and oil product trading[26] - The power business is a local power enterprise integrating hydropower generation, supply, and distribution, possessing a "generation-grid integration" advantage[27] - In the first half of 2018, the company's self-owned hydropower plants generated 850 million kWh, a year-on-year decrease of 10.43%; electricity sales were 1.978 billion kWh, a year-on-year increase of 8.92%; and purchased electricity increased by 22.23% year-on-year[28] - Oil product trading is conducted by wholly-owned subsidiary Guangxi Yongsheng, utilizing its wholesale franchise qualification to expand into East China, North China, and Northeast China markets, and promoting gas station network construction[28] - The overall supply and demand in the power industry are relaxed, with national electricity consumption growing by 9.4% and power generation by 8.3% year-on-year[28] - The company's hydropower generation is highly constrained by natural climate, requiring purchased electricity during dry seasons[29] - The oil product trading market is highly competitive, with Guangxi Yongsheng deploying retail terminals through leasing, self-construction, and cooperative operations[29] Significant Changes in Major Assets During the reporting period, the company's long-term equity investments, available-for-sale financial assets, and construction in progress all underwent significant changes, with long-term equity investments increasing, available-for-sale financial assets decreasing, and construction in progress increasing - Long-term equity investments increased by 37.5723 million yuan, primarily including subscription for Guangxi Chaochao New Material, acquisition of Hydrocore Corporation equity, and subscription for Guangxi Construction Industrialization equity[30] - Available-for-sale financial assets decreased by 284.5579 million yuan, mainly due to changes in the fair value of Guohai Securities shares[30] - Construction in progress increased by 381.4684 million yuan, mainly due to an increase in projects under construction by the company and its subsidiaries[30] Analysis of Core Competencies The company's core competencies remained largely unchanged, primarily reflected in its power concession rights, regional market advantages, "generation-grid integration" operating model, mature management experience, hydropower clean energy advantages, and listed company financing platform advantages - The company holds power concession rights and an independent power supply service area[31] - The market region is stable, forming an interconnected power exchange pattern with neighboring provinces and regions[31] - The "generation-grid integration" operating model ensures market advantages in regional power supply[31] - Possesses a decision-making and management team with decades of mature power management experience[31] - Hydropower is a clean energy source, unaffected by raw material prices, offering long-term stable operational advantages[31] - As a listed company, it has financing platform advantages[31] Part IV Overview of Operations In the first half of 2018, the company faced significant operational pressure, including reduced self-generated power due to low water levels at hydropower plants, increased purchased electricity, decreased industrial power load, electricity price reductions, and rising financing costs. The company actively responded, making progress in both its main power business and oil product trading business - In the first half, rainfall and water inflow in the company's hydropower plant basins were low, leading to a 10.43% year-on-year decrease in self-generated power[33] - Total purchased electricity was 1.179 billion kWh, a year-on-year increase of 16.16%[33] - Operating revenue was 6.558 billion yuan, a year-on-year increase of 60.52%, with trade sales revenue at 5.541 billion yuan, a year-on-year increase of 67.79%[33] - Net profit attributable to owners of the parent company was 2.3457 million yuan, a year-on-year decrease of 58.21%[33] - Actively promoted power project construction, acquired Shaanxi Changxing Photovoltaic Technology Company, and advanced transmission and transformation projects[34] - Oil product trading and other trade businesses achieved operating revenue of 5.541 billion yuan and net profit of 35.1796 million yuan, realizing growth in both quality and quantity[34] - Invested in new building industrial chain businesses, including Minshang Stone Industry, Chaochao New Material, and Construction Industrialization Company[34] - Compressed management hierarchy to improve management efficiency[35] Analysis of Main Business Operating revenue and costs significantly increased due to the expanded sales scale of oil product trading, financial expenses rose due to increased borrowings, and net profit was affected by reduced gross profit from the main power business Analysis of Changes in Financial Statement Items | Item | Current Period Amount | Same Period Last Year Amount | Change Ratio (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 6,558,474,962.18 | 4,085,752,565.60 | 60.52 | | Operating Cost | 6,162,969,507.75 | 3,771,348,554.83 | 63.42 | | Financial Expenses | 200,798,921.40 | 148,330,480.99 | 35.37 | | Asset Impairment Losses | 1,711,863.55 | -367,419.89 | N/A | | Investment Income | 3,235,359.27 | 14,404,765.05 | -77.54 | | Non-operating Income | 5,480,835.73 | 3,085,975.93 | 77.60 | | Income Tax Expense | 25,962,772.52 | 18,417,157.70 | 40.97 | | Net Cash Flow from Operating Activities | -43,362,646.56 | -247,772,810.42 | N/A | | Net Cash Flow from Investing Activities | -473,162,220.03 | -827,697,944.28 | N/A | | Net Cash Flow from Financing Activities | 557,093,616.22 | 289,766,131.83 | 92.26 | - Changes in operating revenue and costs were mainly due to the expanded sales scale of wholly-owned subsidiaries Guangxi Yongsheng and Guisheng Company[37] - Changes in financial expenses were mainly due to increased company borrowings[37] - The increase in net cash flow from operating activities was mainly due to increased cash received by Guangxi Yongsheng from sales of goods and provision of services[37] - The decrease in investment income was mainly due to reduced investment gains/losses from associates and joint ventures[37] - Significant changes in profit composition were mainly due to reduced self-generated power, increased purchased power, and electricity price reduction policies leading to decreased gross profit from the main power business[38] Analysis of Assets and Liabilities At the end of the reporting period, the company's asset and liability structure changed significantly, with substantial increases in accounts receivable, inventories, non-current liabilities due within one year, and long-term payables, while notes receivable, employee benefits payable, interest payable, and bonds payable decreased. Both total assets and total liabilities grew, and the asset-liability ratio increased Changes in Assets and Liabilities | Item Name | Period-End Amount | Period-End Proportion of Total Assets (%) | Prior Period-End Amount | Prior Period-End Proportion of Total Assets (%) | Change from Prior Period-End (%) | Explanation | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Notes Receivable | 108,184,565.04 | 0.78 | 181,329,092.33 | 1.42 | -40.34 | Increase in bank acceptance bill maturity and acceptance | | Accounts Receivable | 426,339,954.53 | 3.08 | 169,708,685.05 | 1.33 | 151.22 | Increase in receivables from parent company and wholly-owned subsidiary Guangxi Yongsheng | | Other Receivables | 582,096,325.26 | 4.20 | 392,929,844.02 | 3.08 | 48.14 | Increase in inter-company receivables | | Inventories | 1,090,499,205.83 | 7.87 | 781,243,827.08 | 6.13 | 39.59 | Increase in inventories at wholly-owned subsidiaries Guisheng Company and Tianxiang Company | | Notes Payable | 824,672,460.06 | 5.95 | 575,771,738.71 | 4.51 | 43.23 | Increase in notes payable at wholly-owned subsidiaries Guangxi Yongsheng and Guisheng Company | | Accounts Payable | 408,402,484.45 | 2.95 | 90,648,135.72 | 0.71 | 350.54 | Increase in payables at wholly-owned subsidiaries Guangxi Yongsheng and Guisheng Company | | Employee Benefits Payable | 2,045,985.65 | 0.01 | 31,823,110.19 | 0.25 | -93.57 | Payment of employee benefits payable at the beginning of the period | | Interest Payable | 92,586,124.81 | 0.67 | 183,618,455.62 | 1.44 | -49.58 | Increase in interest paid on bonds payable this period | | Non-current Liabilities Due Within One Year | 3,932,235,337.25 | 28.39 | 492,850,000.00 | 3.86 | 697.86 | Increase in bonds and borrowings due within one year | | Bonds Payable | - | 0.00 | 3,462,896,422.79 | 27.15 | -100.00 | Parent company bonds payable reclassified to non-current liabilities due within one year | | Long-term Payables | 800,000,000.00 | 5.78 | - | 0.00 | 100.00 | Increase in amounts owed by parent company to Guangdong Yuecai Trust Co., Ltd | | Specific Payables | 65,558,919.07 | 0.47 | 108,975,852.95 | 0.85 | -39.84 | Decrease in specific payables at controlling subsidiary Guiyuan Company | | Deferred Income Tax Liabilities | 62,880,026.71 | 0.45 | 105,692,142.84 | 0.83 | -40.51 | Impact of fair value changes in Guohai Securities | | Deferred Income | 15,587,872.10 | 0.11 | 10,883,850.18 | 0.09 | 43.22 | Controlling subsidiary Guiyuan Company received government matching funds | | Other Comprehensive Income | 332,446,530.11 | 2.40 | 574,320,761.65 | 4.50 | -42.11 | Impact of fair value changes in Guohai Securities | - At the end of the reporting period, total assets were 13.849 billion yuan, an 8.59% increase from the end of the previous year; net assets attributable to listed company shareholders were 1.778 billion yuan, a 12.77% decrease from the end of the previous year[20] - The asset-liability ratio was 83.40%, an increase of 3.16 percentage points from the end of the previous year, mainly due to increased company borrowings[136] Major Asset Restrictions At the end of the reporting period, some of the company's monetary funds, fixed assets, and intangible assets were restricted due to bill deposits, litigation preservation deposits, and mortgages, with a total restricted amount of 661 million yuan Major Asset Restrictions | Item | Period-End Book Value (Yuan) | Reason for Restriction | | :--- | :--- | :--- | | Monetary Funds | 119,268,111.89 | Bill deposits, litigation preservation deposits | | Fixed Assets | 535,883,998.08 | Mortgage | | Intangible Assets | 6,014,855.93 | Mortgage | | Total | 661,166,965.90 | / | Analysis of Investment Status During the reporting period, the company's total external equity investments decreased by 30.13% year-on-year, but it still made several significant equity and non-equity investments and held financial assets measured at fair value - External equity investment amounted to 77.5396 million yuan, a 30.13% decrease from the same period last year[45] - Significant equity investments include the acquisition of 90% equity in Shaanxi Changxing Photovoltaic Technology, subsidiary Xidian Company's acquisition of 40% equity in Hydrocore Corporation, and a 20% stake in Guangxi Construction Industrialization Co., Ltd[46][47] Significant Equity Investments | Investee Company Name | Main Business | Planned Investment Amount (Ten Thousand Yuan) | Actual Investment Amount in This Reporting Period (Ten Thousand Yuan) | Cumulative Actual Investment Amount (Ten Thousand Yuan) | Proportion of Investee's Equity | Source of Funds | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Shaanxi Changxing Photovoltaic Technology Co., Ltd. | Construction and sales of photovoltaic power plants; manufacturing and sales of photovoltaic power generation equipment, etc. | 3,375.00 | 0 | 0 | 90% | Self-raised | | Hydrocore Corporation | Development, operation, and maintenance rights of Ibulao Hydropower Project | 2,320.96 | 2,320.96 | 2,320.96 | 40% | Self-raised | | Guangxi Construction Industrialization Co., Ltd. | Production and sales of building components; real estate development, sales, and property management, etc. | 2,000.00 | 2,000.00 | 2,000.00 | 20% | Self-raised | | Sichuan Xidian Electric Power Design Co., Ltd. | Survey, design, and supervision of transmission and transformation projects, water conservancy and hydropower projects, and industrial and civil construction projects, etc. | 15,912.00 | 1,632.00 | 15,912.00 | 51% | Self-raised | | Shaanxi Guixing Electric Power Co., Ltd. | Investment, construction, and operation management of power and other energy projects, etc. | 1,040.00 | 501.00 | 501.00 | 52% | Self-raised | | Guangxi Chaochao New Material Co., Ltd. | Research, development, and production of new materials for new housing construction, etc. | 2,541.88 | 1,300.00 | 2,541.88 | 30% | Self-raised | | Total | / | 27,189.84 | 7,753.96 | 23,275.84 | / | / | - Significant non-equity investments include the Hezhou Aluminum Electronic Industry Power Workshop Project, Power Dispatching Building Project (Guidong Plaza), Petrochemical Storage Project, etc., with several projects still under construction[49] Significant Non-Equity Investments | Project Name | Project Amount (Ten Thousand Yuan) | Amount Invested in This Reporting Period (Ten Thousand Yuan) | Cumulative Actual Investment Amount (Ten Thousand Yuan) | Project Progress (%) | Project Revenue Status | | :--- | :--- | :--- | :--- | :--- | :--- | | Wholly-owned subsidiary Guixu Energy invested in and constructed Hezhou Aluminum Electronic Industry Power Workshop Project | 294,452.00 | 17,767.64 | 228,147.92 | 71 | Incomplete | | Investment and construction of Power Dispatching Building Project (Guidong Plaza) | 63,438.85 | 8,215.86 | 23,967.28 | 38 | Incomplete | | Wholly-owned subsidiary Guangxi Yongsheng invested in and constructed Petrochemical Storage Project | 15,247.62 | 3,106.35 | 6,538.35 | 50 | Incomplete | | JiangKou Switching Station to Tiantang Substation 110 kV Transmission Line Project | 11,748.24 | 665.70 | 8,479.03 | 90 | Incomplete | | Wholly-owned subsidiary Guixu Energy invested in and constructed Phase I of Xindu Railway Station Modern Logistics Park in Guangdong-Guangxi Industrial Cooperation Demonstration Zone | 17,900.00 | 488.23 | 7,705.14 | 60 | Incomplete | | 110 kV Shiti Transmission and Transformation Project | 6,252.30 | 22.61 | 6,220.31 | 90 | Incomplete | | Hezhou Aluminum Electronic Industry Project (Phase I) 220 kV Transmission Line Project | 24,856.00 | 2,958.12 | 20,806.32 | 96 | Incomplete | | 220 kV Fulong Transmission and Transformation Project | 18,859.53 | 522.08 | 13,333.92 | 98 | Incomplete | | 220 kV Litou Transmission and Transformation Project | 14,518.22 | 1,219.45 | 4,415.05 | 25 | Incomplete | | Wholly-owned subsidiary Guixu Energy invested in and constructed Hezhou Aluminum Electronic Industry Power Workshop Railway Special Line | 51,700.00 | 3,080.86 | 42,069.21 | 76 | Incomplete | | Technical Transformation | 5,800.00 | 851.08 | 851.08 | N/A | N/A | | Shangcheng Electric Power Datian Hydropower Station Project | 23,650.44 | 277.62 | 23,475.07 | 55 | Incomplete | | Total | 548,423.20 | 39,175.59 | 386,008.69 | / | | - Financial assets measured at fair value are mainly Guohai Securities shares, with a fair value change of 264.3127 million yuan at period-end[51] Analysis of Major Holding and Participating Companies The company owns 21 wholly-owned and controlled subsidiaries and 14 associate companies; some subsidiaries performed exceptionally well, such as Guangxi Yongsheng Petrochemical Co., Ltd. with a 96.99% net profit increase, while some hydropower subsidiaries saw performance decline due to low water levels. The company also plans to dissolve Minfeng Industrial - The company owns 21 wholly-owned and controlled subsidiaries, with main businesses covering power, oil product trading, new building industrial chain, etc[52] - Guangxi Guineng Electric Power Co., Ltd. reported a net profit of 18.5187 million yuan, a year-on-year increase of 236.34%[53] - Pingle Guijiang Electric Power Co., Ltd. reported a net profit of 19.0779 million yuan, a year-on-year decrease of 12.54%[54] - Zhaoping Guihai Electric Power Co., Ltd. reported a net profit of 12.9868 million yuan, a year-on-year decrease of 7.00%[54] - Hezhou Shangcheng Electric Power Co., Ltd. reported a net loss of 2.7148 million yuan, with losses increasing by 0.3946 million yuan[55] - Guangxi Hezhou Minfeng Industrial Co., Ltd. reported a net profit of 1.5765 million yuan, a year-on-year decrease of 77.78%; the company plans to dissolve Minfeng Company[55][56] - Guangxi Yongsheng Petrochemical Co., Ltd. reported a net profit of 31.3105 million yuan, a year-on-year increase of 96.99%, mainly due to expanded sales scale[59][76] - Guangxi Guisheng Energy Co., Ltd. reported a net profit of 4.4359 million yuan, a year-on-year increase of 129.70%[60] - Hezhou Guiyuan Water Conservancy and Electric Power Co., Ltd. reported a net profit of 11.9960 million yuan, a year-on-year increase of 164.68%, primarily by expanding its electricity market[62][76] - Wuzhou Guijiang Electric Power Co., Ltd. reported a net profit of 13.2217 million yuan, a year-on-year decrease of 34.93%[63] - Guangdong Guidong Electric Power Co., Ltd. reported a net profit of 1.4492 million yuan, a year-on-year increase of 1,262.03%[65] - Sichuan Xidian Electric Power Design Co., Ltd. reported a net profit of 17.7053 million yuan[66] - Associate companies include Guohai Securities, Guilin Bank, Liuzhou Guanghe Microfinance, and 11 others, totaling 14 companies[68] - During the reporting period, the company received a 2017 annual cash dividend of 12.8372 million yuan from Guohai Securities, accounting for 51.36% of the company's net profit for January-June 2018[69] - Changes in company subsidiaries include the acquisition of equity in Shaanxi Changxing Photovoltaic Technology, the transfer of Guangxi Yongsheng's equity in Guisheng Energy and Deqing Xinghai Gas Station, and the transfer of Guisheng Energy's equity in Guangdong Guisheng New Energy[76] Other Disclosure Matters This chapter discloses potential risks faced by the company, including operational risks, industry competition risks, accounts receivable recovery risks, market and electricity price policy adjustment risks, investment risks, and financing environment change risks, along with corresponding countermeasures - The cumulative net profit from the beginning of the year to the end of the next reporting period is uncertain due to the planned sale of some Guohai Securities shares[77] - Operational risks primarily stem from the single power source structure of the electricity business, which is highly susceptible to natural factors, potentially leading to reduced power generation and increased purchase costs[79] - Industry competition risks arise from the deepening reform of the power system and intensified market competition[79] - Accounts receivable recovery risks mainly involve historical outstanding receivables of wholly-owned subsidiary Guangxi Yongsheng[80] - Market and electricity price policy adjustment risks may affect the company's electricity sales and profitability[80] - Investment risks include lower-than-expected returns on external investments and the suspension of the power workshop project under construction by wholly-owned subsidiary Guixu Energy[81] - Changes in the financing environment lead to stricter corporate credit conditions, rising financing costs, and increased financing difficulty[83] - The company will address risks by optimizing dispatch, expanding markets, strengthening internal controls, adjusting operating strategies, reinforcing investment project supervision, and broadening financing channels[79][80][81][82][83] Part V Shareholders' Meeting Information This chapter discloses the convening date and resolution publication information of the 2017 Annual Shareholders' Meeting - The 2017 Annual Shareholders' Meeting was held on May 18, 2018, with resolutions published on www.sse.com.cn and disclosed on May 19, 2018[85] Profit Distribution or Capital Reserve Conversion Plan During the reporting period, the company did not formulate a profit distribution or capital reserve to share capital conversion plan - The company's proposed semi-annual profit distribution plan or capital reserve to share capital conversion plan is “No”[85] Accounting Firm Information The company's 2017 financial statements received an unqualified audit opinion with an emphasis of matter paragraph from Daxin Certified Public Accountants, highlighting the significant impact of the suspended power workshop project under construction by wholly-owned subsidiary Guixu Energy. The company is actively coordinating to resume construction - Daxin Certified Public Accountants issued an unqualified audit report with an emphasis of matter paragraph on the company's 2017 financial statements[87] - The emphasis of matter concerns the power workshop project under construction by wholly-owned subsidiary Guixu Energy, which is currently suspended; if it cannot be resumed, it will have a significant impact on the company's operating results and financial position[87] - The company is actively communicating with various levels of government and competent authorities to secure support for resuming the power workshop project and has reached an agreement on the transfer of unit capacity indicators[88] Significant Litigation and Arbitration Matters During the reporting period, wholly-owned subsidiary Guangxi Yongsheng was involved in multiple sales contract dispute lawsuits; some cases had final rulings dismissing appeals, while others were accepted but not yet heard - In the sales contract dispute case of Guangxi Yongsheng vs. Guangzhou Zhongyou Runao Petrochemical Co., Ltd. and Zhenghai Holding Group Co., Ltd., the final ruling dismissed Guangxi Yongsheng's appeal and upheld the original ruling[89] - Guangxi Yongsheng filed a lawsuit against CNOOC Guangxi Energy Co., Ltd. regarding a sales contract dispute with Nanning Xixiangtang District People's Court, which has accepted the case but has not yet held a hearing[89] - Guangxi Yongsheng filed a lawsuit against Cangzhou Jiantou Modern Logistics Co., Ltd. regarding a sales contract dispute with Cangzhou Intermediate People's Court in Hebei Province, which has accepted the case but has not yet held a hearing[89] Significant Related Party Transactions During the reporting period, the company engaged in related party transactions for goods sales and office space leasing related to ordinary operations, with a significant amount in electricity sales Occurrence of Routine Related Party Transactions | Related Party Transaction Type | Classified by Product or Service | Related Party | Estimated Amount for 2018 (Ten Thousand Yuan) | Cumulative Transaction Amount with Related Party in Jan-Jun 2018 (Ten Thousand Yuan) | % of Total Estimated Annual Amount | | :--- | :--- | :--- | :--- | :--- | :--- | | Sales of Goods | Electricity Sales | Guangxi Zhengrun Development Group Co., Ltd. Wuzhou Grand Hotel | 90 | 33.29 | 39.99 | | Sales of Goods | Electricity Sales | Guangxi Zhengrun New Material Technology Co., Ltd. | 1,430 | 755.80 | 52.85 | | Sales of Goods | Electricity Sales | Guangxi Hezhou Guidong Electronic Technology Co., Ltd. | 18,650 | 9,699.82 | 52.01 | | Sales of Goods | Electricity Sales | Guangxi Zhengrun Riqing High Purity Aluminum Technology Co., Ltd. | 350 | 152.88 | 43.68 | | Other Related Party Transactions | Office Space Lease | Guangxi Zhengrun Development Group Co., Ltd. | 154.33 | 93.32 | 60.47 | | Other Related Party Transactions | Production and Office Space Lease | Hezhou Babu Water Conservancy and Electric Power Co., Ltd. | 152.55 | 12.90 | 8.46 | | Total | | | 20,826.88 | 10,748.01 | | Significant Contracts and Their Performance During the reporting period, the company was primarily involved in guarantees for subsidiaries and multiple bank loan contracts, cumulatively repaying 1.849 billion yuan in financial institution loans, with new borrowings totaling 1.97255 billion yuan, and total guarantees accounting for 35.74% of the company's net assets Total Company Guarantees | Total Company Guarantees | Amount (Yuan) | Proportion (%) | | :--- | :--- | :--- | | Total Guarantees (A+B) | 821,719,180.00 | | | Proportion of Total Guarantees to Company Net Assets (%) | | 35.74 | | Debt Guarantees Provided Directly or Indirectly for Guaranteed Parties with Asset-Liability Ratio Exceeding 70% (D) | 731,719,180.00 | | | Total of the Above Three Guarantee Amounts (C+D+E) | 731,719,180.00 | | - During the reporting period, the company cumulatively repaid 1.84931 billion yuan in financial institution loans and borrowed a total of 1.97255 billion yuan from financial institutions[96] - The company signed working capital loan contracts with multiple banks, with loan amounts ranging from 46 million yuan to 200 million yuan, mostly for a one-year term[96][97][98][99][100][101] - Company subsidiary Wuzhou Guijiang Company signed a fixed asset loan contract of 68 million yuan with Bank of Communications, with a ten-year term[98] - The company signed a fixed asset loan contract of 85 million yuan with Industrial and Commercial Bank of China, with a ten-year term, for the construction of the JiangKou Switching Station to Tiantang Substation 110 kV Transmission Line Project[100] Listed Company Poverty Alleviation Work The company continues its targeted poverty alleviation efforts through "one-on-one" assistance, tailored approaches, technical support, and industrial poverty alleviation, planning to lift all impoverished households out of poverty by the end of 2020. During the reporting period, the company donated 80,000 yuan to support the development of village collective economies - The company's targeted poverty alleviation work adopts a "unit head + liaison person" assistance model, providing "one-on-one" support to impoverished households[102] - Plans to pre-lift 15 households out of poverty by the end of 2018, striving to achieve complete poverty eradication by the end of 2020[102] - During the reporting period, the company donated 80,000 yuan to support the development of village collective economies, such as planting moringa and traditional Chinese medicine, in Xinchun Village, Xianhui Township[103] Achievements in Targeted Poverty Alleviation | Indicator | Quantity and Implementation Status | | :--- | :--- | | I. Overall Situation | | | Of which: 1. Funds | 80,000 yuan | | 2. Value of Materials | 7,812 yuan | | 3. Number of Registered Impoverished People Helped to Escape Poverty (persons) | 5 persons | - Subsequent plans include focused tracking and support for pre-lifted and un-lifted households, and monitoring the effectiveness of donated fund utilization[106] Environmental Information The company and its subsidiaries are not classified as key polluting entities, are committed to safe production and environmental protection, and adhere to a green and environmentally friendly production philosophy through measures such as scientifically allocating unit loads, reducing energy and water consumption, and preventing electromagnetic pollution - The company and its subsidiaries are not classified as key polluting entities by environmental protection departments[107] - The company focuses on safe production and environmental protection, adhering to the path of sustainable development[107] - Adopts measures such as scientifically and reasonably allocating unit loads, reducing energy and water consumption, conserving energy resources, and preventing electromagnetic pollution from the grid[107] Other Significant Matters During the reporting period, the company's accounting policies changed, involving adjustments to the presentation of government grants and asset disposal gains/losses. Additionally, progress on Guangxi Yongsheng's accounts receivable, the proposed dissolution of Minfeng Company, sale-and-leaseback financing, accounts receivable transfer and repurchase financing, the temporary suspension of controlling shareholder equity transfer, and the planned sale of Guohai Securities shares were disclosed - Accounting policy changes involve "Accounting Standard for Business Enterprises No. 16 – Government Grants" and "Notice of the Ministry of Finance on Revising and Issuing the Format of Financial Statements for General Enterprises," reclassifying government grants related to daily activities into other income and adjusting the presentation of asset disposal gains/losses[108][109] - Guangxi Yongsheng prepaid 151.84 million yuan to Liuzhou Zhengling Heavy-duty CNC Machine Tool Co., Ltd. and its related enterprises, with part offset by equity transfer payments; related work is ongoing[110] - Guangxi Yongsheng won the contract dispute case against Guangxi Nanning Taixie Gan Trading Co., Ltd[111] - In the accounts receivable dispute case between Guangxi Yongsheng and Guangxi Tietou Guanxin Industrial Co., Ltd., the second instance judgment revoked the first instance judgment and dismissed Guangxi Yongsheng's claims[111][112] - The company plans to dissolve its wholly-owned subsidiary Guangxi Hezhou Minfeng Industrial Co., Ltd.; related work is ongoing[112] - The company plans to conduct sale-and-leaseback financing with China Merchants Financial Leasing (Tianjin) Co., Ltd., with a total financing amount not exceeding 500 million yuan, which has not yet been implemented[112] - The company has signed agreements with Guangdong Yuecai Trust Co., Ltd. regarding accounts receivable transfer and repurchase financing business[113] - Hezhou Municipal People's Government and Guangxi Investment Group Co., Ltd. signed a cooperation agreement, planning to use Guangxi Zhengrun Development Group Co., Ltd., the controlling shareholder of Guidong Electric Power, as a cooperation platform to jointly promote in-depth cooperation in energy and other industries[113] - The Hezhou SASAC's plan to gratuitously transfer 85% of Zhengrun Group's equity held by Nongtou Group to Hetou Group has been suspended[114] - The company plans to provide total financial support of up to 5 billion yuan to its wholly-owned and controlled subsidiaries[114] - The company plans to sell some Guohai Securities shares, with the total sale amount not exceeding 5% of Guohai Securities' total share capital; currently, no sales have occurred[115] Part VI Changes in Share Capital During the reporting period, there were no changes in the company's total share capital or share capital structure - During the reporting period, there were no changes in the company's total share capital or share capital structure[118] Shareholder Information As of the end of the reporting period, the total number of ordinary shareholders was 39,849. The controlling shareholder, Guangxi Zhengrun Development Group Co., Ltd., held 50.03% of the shares, with no pledge or freeze status - As of the end of the reporting period, the total number of ordinary shareholders was 39,849[120] Top Ten Shareholders' Shareholding | Shareholder Name | Period-End Shareholding (shares) | Proportion (%) | Pledge or Freeze Status | Shareholder Nature | | :--- | :--- | :--- | :--- | :--- | | Guangxi Zhengrun Development Group Co., Ltd. | 414,147,990 | 50.03 | None | State-owned Legal Person | | Song Jianbo | 12,556,400 | 1.52 | Unknown | Unknown | | Chen Guangyang | 12,111,697 | 1.46 | Unknown | Unknown | | Guangxi Hezhou Guangze Capital Investment Co., Ltd. | 10,663,536 | 1.29 | Unknown | State-owned Legal Person | | Lin Min | 8,485,271 | 1.03 | Unknown | Unknown | | Hong Kong Securities Clearing Company Limited | 7,513,279 | 0.91 | Unknown | Unknown | | Agricultural Bank of China Co., Ltd. - Invesco Great Wall CSI 300 Enhanced Index Securities Investment Fund | 7,159,814 | 0.86 | Unknown | Unknown | | China Securities Finance Corporation Limited | 3,537,900 | 0.43 | Unknown | Unknown | | Zhao Yitong | 2,686,000 | 0.32 | Unknown | Unknown | | Li Xiaodong | 2,526,803 | 0.31 | Unknown | Unknown | - Controlling shareholder Guangxi Zhengrun Development Group Co., Ltd. and Guangxi Hezhou Guangze Capital Investment Co., Ltd. are both under the actual control of Hezhou SASAC[123] Part VII Preferred Shares Information Part VIII Information on Directors, Supervisors, and Senior Management Part IX Basic Information on Corporate Bonds The company issued four tranches of corporate bonds, totaling 2.828 billion yuan, all of which have completed interest payments on schedule Basic Information on Corporate Bonds | Bond Name | Abbreviation | Code | Issue Date | Maturity Date | Bond Balance (Yuan) | Interest Rate (%) | Trading Venue | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Guangxi Guidong Electric Power Co., Ltd. 2011 Corporate Bonds (Tranche 1) | 11 Guidong 01 | 122138 | April 16, 2012 | April 16, 2019 | 600,000,000.00 | 6.3% | Shanghai Stock Exchange | | Guangxi Guidong Electric Power Co., Ltd. 2011 Corporate Bonds (Tranche 2) | 11 Guidong 02 | 122145 | June 20, 2012 | June 20, 2019 | 228,015,000.00 | 5.3% | Shanghai Stock Exchange | | Guangxi Guidong Electric Power Co., Ltd. 2016 Corporate Bonds (Tranche 1) | 16 Guidong 01 | 135219 | February 4, 2016 | February 4, 2021 | 1,000,000,000.00 | 6.3% | Shanghai Stock Exchange | | Guangxi Guidong Electric Power Co., Ltd. 2016 Corporate Bonds (Tranche 2) | 16 Guidong 02 | 135248 | March 1, 2016 | March 1, 2021 | 1,000,000,000.00 | 5.7% | Shanghai Stock Exchange | - During the reporting period, the company's 2011 corporate bonds (first and second tranches) and 2016 corporate bonds (first and second tranches) all completed interest payments[128] Corporate Bond Trustee Management and Rating Agency Information This chapter discloses the contact information and office addresses of the corporate bond trustees (Guosen Securities and Guohai Securities) and credit rating agency (United Credit Rating Co., Ltd.) - The bond trustee for 11 Guidong 01 and 11 Guidong 02 is Guosen Securities Co., Ltd[129][130] - The bond trustee for 16 Guidong 01 and 16 Guidong 02 is Guohai Securities Co., Ltd[129][130] - The credit rating agency for all four tranches of bonds is United Credit Rating Co., Ltd[130] Use of Corporate Bond Proceeds The two tranches of corporate bonds issued by the company raised a total of 3 billion yuan, with a net amount of 2.966 billion yuan after deducting issuance expenses, all used to repay bank loans, settle company debts, supplement working capital, and fund project construction, consistent with the uses promised in the prospectus - The two tranches of corporate bonds issued in April and June 2012 raised 1 billion yuan, with a net amount of 986 million yuan, all used to repay the company's bank loans[131] - The two tranches of corporate bonds issued in February and March 2016 raised 2 billion yuan, with a net amount of 1.98 billion yuan, all used to repay company debts, supplement working capital, and fund project construction[131] Corporate Bond Rating Status United Credit Rating Co., Ltd. maintained the company's "AA" long-term corporate credit rating and the credit ratings for all bond tranches, with a "stable" outlook - United Credit Rating Co., Ltd. maintained the company's "AA" long-term corporate credit rating, with a "stable" outlook[132] - Maintained the "AA" bond credit ratings for "16 Guidong 01" bond, "16 Guidong 02" bond, "11 Guidong 01" bond, and "11 Guidong 02" bond[132] Corporate Bond Enhancement Mechanism and Repayment Plan During the reporting period, no credit enhancement measures were adopted for the company's corporate bonds, the repayment plan was consistent with the prospectus, and annual interest payments were made on schedule - During the reporting period, no credit enhancement measures were adopted for the corporate bonds issued by the company[133] - The repayment plan is consistent with the content agreed upon in the prospectus, with no significant changes[133] - During the reporting period, the company paid the annual interest on schedule[133] Corporate Bond Trustee Performance Guosen Securities and Guohai Securities, as corporate bond trustees, strictly fulfilled their duties, continuously monitored the company's operating and financial conditions, and disclosed trustee reports, safeguarding the legitimate rights and interests of bondholders - Guosen Securities and Guohai Securities both strictly fulfilled their trustee duties in accordance with the agreements[134] - The trustees continuously monitored the company's operating conditions, financial status, and creditworthiness, and disclosed trustee reports[134] Corporate Bond Related Financial Indicators At the end of the reporting period, the company's current ratio and quick ratio decreased, and the asset-liability ratio increased, mainly due to increased non-current liabilities due within one year and increased borrowings. The EBITDA interest coverage ratio slightly decreased Corporate Bond Related Financial Indicators | Key Indicator | End of This Reporting Period | End of Last Year | Change from End of Last Year (%) | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | Current Ratio | 55.69% | 76.91% | Decrease of 21.22 percentage points | Mainly due to increased non-current liabilities due within one year | | Quick Ratio | 43.52% | 57.86% | Decrease of 14.34 percentage points | Mainly due to increased non-current liabilities due within one year | | Asset-Liability Ratio (%) | 83.40 | 80.24 | Increase of 3.16 percentage points | Mainly due to increased company borrowings | | Loan Repayment Rate (%) | 100.00 | 100.00 | N/A | | | This Reporting Period (Jan-Jun) | Same Period Last Year | Change from Same Period Last Year (%) | Reason for Change | | | EBITDA Interest Coverage Ratio | 1.48 | 1.57 | -5.73 | Mainly due to decreased company profit | | Interest Payment Rate (%) | 100.00 | 100.00 | N/A | | Interest Payment and Redemption of Other Debt Financing Instruments As of the end of the reporting period, all non-public directed debt financing instruments issued by the company had paid interest on schedule - The first tranche of non-public directed debt financing instruments for 2015 (100 million yuan, 3-year term, 5% interest rate) has paid interest on schedule[138] - The first tranche of non-public directed debt financing instruments for 2016 (650 million yuan, 3-year term, 5.5% interest rate) has paid interest on schedule[138] Bank Credit Facilities As of June 30, 2018, the company's total bank credit facilities were 6.284 billion yuan in RMB and 100 million USD, with 5.392 billion yuan and 66 million USD utilized, respectively - As of June 30, 2018, the company's total bank RMB credit facility was 6.284 billion yuan, with 5.392 billion yuan utilized[139] - The total USD credit facility was 100 million USD, with 66 million USD utilized[139] - Repaid bank loans of 1.849 billion yuan and 60 million USD[139] Performance of Corporate Bond Prospectus Covenants During the reporting period, the company strictly fulfilled the relevant covenants and commitments in the corporate bond prospectus, paid interest on time, and did not harm the interests of bond investors - The company strictly fulfilled the relevant covenants and commitments in the corporate bond prospectus[140] - Paid corporate bond interest on time, without harming the interests of bond investors[140] Impact of Significant Matters on Operations and Solvency As of the end of the reporting period, the company's loan balance was 8.528 billion yuan, an increase of 39 million yuan from the end of 2017, with new borrowings accounting for 1.55% of net assets at the end of 2017. External guarantees totaled 822 million yuan, accounting for 32.62% of net assets at the end of 2017. These new borrowings and guarantees are within the scope of normal operating activities and have no significant impact on the company's solvency - As of the end of the reporting period, the company's loan balance was 8.528 billion yuan, an increase of 39 million yuan from the end of 2017[141] - Cumulative new borrowings accounted for 1.55% of the company's net assets of 2.52 billion yuan at the end of 2017[141] - External guarantees (all provided for subsidiaries) amounted to 822 million yuan, accounting for 32.62% of the company's net assets at the end of 2017[141] - The aforementioned new borrowings and guarantees are within the scope of the company's normal operating activities and have no significant impact on the company's solvency[141] Part X Financial Statements This chapter includes the company's 2018 semi-annual consolidated and parent company balance sheets, income statements, and cash flow statements, as well as consolidated and parent company statements of changes in equity, comprehensively presenting the financial position and operating results at the end of the reporting period - Provides consolidated balance sheet, parent company balance sheet, consolidated income statement, parent company income statement, consolidated cash flow statement, parent company cash flow statement, consolidated statement of changes in equity, and parent company statement of changes in equity[145][148][152][156][158][161][165][170] Company Basic Information This chapter introduces the company's establishment, history of share capital changes, business scope, and approval status of financial statements - The company was approved to issue A-shares on January 9, 2001, and listed on the Shanghai Stock Exchange on February 28, with stock abbreviation “Guidong Electric Power” and code “600310”[174] - Share capital has undergone multiple changes, totaling 827,775,000.00 yuan as of the end of the reporting period[175] - Business scope includes power generation, power supply, power investment and development, water supply, transportation construction, and infrastructure development[176] - The financial report was approved for issuance by the Board of Directors on August 20, 2018[176] Scope of Consolidated Financial Statements A total of 20 subsidiaries were included in the scope of consolidation this period, an increase of four from the previous year - A total of 20 subsidiaries were included in the scope of consolidation this period, an increase of four subsidiaries compared to the previous year[177] Basis of Financial Statement Preparation The company's financial statements are prepared on a going concern basis, in accordance with the Accounting Standards for Business Enterprises issued by the Ministry of Finance and significant accounting policies and estimates, and possess the ability to continue as a going concern for at least 12 months - Financial statements are prepared on a going concern basis, adhering to Accounting Standards for Business Enterprises[178] - The company possesses the ability to continue as a going concern for at least 12 months from the end of this reporting period[179] Significant Accounting Policies and Estimates This chapter details the company's specific accounting policies and estimation methods for accounting periods, operating cycles, functional currency, business combinations, consolidated financial statement preparation, joint arrangements, cash and cash equivalents, foreign currency transactions, financial instruments, receivables, inventories, long-term equity investments, investment properties, fixed assets, construction in progress, borrowing costs, intangible assets, impairment of long-term assets, long-term deferred expenses, employee benefits, provisions, revenue, government grants, deferred income tax assets/liabilities, and leases - Adheres to Accounting Standards for Business Enterprises, accurately and completely reflecting financial information[181] - The accounting year is from January 1 to December 31 of the Gregorian calendar, with an operating cycle of 12 months[182][183] - Financial instruments are classified as financial assets measured at fair value with changes recognized in profit or loss, held-to-maturity investments, receivables, available-for-sale financial assets, etc[193] - Provision for doubtful accounts receivable is made using individual significant amounts and by grouping based on credit risk characteristics (aging analysis method)[197][198] - Inventories are classified as raw materials, finished goods, semi-finished goods, spare parts, low-value consumables, etc.; issued inventories are valued using the weighted average method, and impairment provisions are made for individual inventory items[200] - Long-term equity investments in subsidiaries are accounted for using the cost method, while investments in associates and joint ventures are accounted for using the equity method[202] - Fixed assets are depreciated using the straight-line method, with depreciation periods and residual value rates determined by asset category[206] - Revenue recognition standards vary by business type (electricity sales, trading, liquor sales, power survey and design, consulting services, general contracting, engineering management services)[224][225][226][227][228] - Government grants are classified as asset-related or income-related, recognized as deferred income or directly in profit or loss, respectively[229][230] Taxation This chapter discloses the company's main tax categories and rates, including VAT, consumption tax, urban maintenance and construction tax, corporate income tax, and education surcharge. Some subsidiaries enjoy corporate income tax incentives for Western Development, prepaying at a 15% tax rate Main Tax Categories and Rates | Tax Category | Tax Basis | Tax Rate | | :--- | :--- | :--- | | Value-Added Tax | 17% of taxable income less deductible input tax (changed to 16% after May 1) | 17% (16%), 6%, 3% | | Consumption Tax | Taxable consumption tax income | 20% plus 0.5 yuan/500 grams | | Urban Maintenance and Construction Tax | Amount of turnover tax payable | 7%, 5%, 1% | | Corporate Income Tax | Taxable income | 25%, 15% | | Education Surcharge | Amount of turnover tax payable | 5% | - The company and some subsidiaries enjoy corporate income tax incentives for Western Development, provisionally prepaying at a 15% income tax rate[236] - The newly added subsidiary Sichuan Xidian Electric Power Design Co., Ltd.'s Mianyang branch qualifies as a small-profit enterprise, paying corporate income tax at a 20% rate, with taxable income reduced by 50%[237] Notes to Consolidated Financial Statement Items This chapter provides detailed notes and explanations for various assets, liabilities, owners' equity, income, and expense items in the consolidated financial statements, including period-end balances, beginning balances, reasons for changes, and recognition methods - Monetary funds at period-end totaled 1.951 billion yuan, with other monetary funds primarily consisting of bank acceptance bill deposits and litigation preservation deposits[239] - Accounts receivable at period-end totaled 426 million yuan, an increase of 151.22% from the beginning of the period, mainly due to increased receivables from the parent company and Guangxi Yongsheng[41][247] - Inventories at period-end totaled 1.09 billion yuan, an increase of 39.59% from the beginning of the period, mainly due to increased inventories at Guisheng Company and Tianxiang Company, including construction costs for the "Guidong Plaza" project and Guixu Energy's agency construction projects[41][267] - Long-term equity investments at period-end totaled 628 million yuan, increasing by 56.20955 million yuan this period, primarily including investments in Hydrocore Corporation