晋西车轴(600495) - 2018 Q2 - 季度财报

Section 1 Definitions This section defines key terms used throughout the report, including the Company and its related entities - Key terms are defined, including the Company (Jinxi Axle Company Limited), its controlling shareholder (Jinxi Industries Group Co, Ltd), Norinco Group (China North Industries Group Corporation Limited), and Binggong Finance (Binggong Finance Co, Ltd)[9] Section 2 Company Profile and Key Financial Indicators This section provides the company's basic information, contact details, and key financial data for the reporting period Company Information This section provides the basic registration information for Jinxi Axle Company Limited Company Basic Information | Indicator | Content | | :--- | :--- | | Company Chinese Name | 晋西车轴股份有限公司 | | Company Chinese Abbreviation | 晋西车轴 | | Company English Name | JINXI AXLE COMPANY LIMITED | | Company English Name Abbreviation | JXAC | | Company Legal Representative | Zhang Chaohong | Contacts This section lists the contact information for the company's Board Secretary and Securities Affairs Representative Contact Persons and Methods | Position | Name | Contact Address | Phone | Fax | Email | | :--- | :--- | :--- | :--- | :--- | :--- | | Board Secretary | Zhou Haihong | No 5, North Lane, Heping North Road, Taiyuan | (0351) 6629027 | (0351) 6628286 | zhh@jinxiaxle.com | | Securities Affairs Representative | Gao Hong | No 5, North Lane, Heping North Road, Taiyuan | (0351) 6628286 | (0351) 6628286 | gh@jinxiaxle.com | Changes in Basic Information The company's basic information, such as registered address and website, remained unchanged during the reporting period - No changes were made to the company's basic information during the reporting period[13] Information Disclosure and Report Availability This section specifies the company's designated information disclosure channels, which did not change during the period Information Disclosure Channels | Item | Content | | :--- | :--- | | Designated newspapers for information disclosure | China Securities Journal, Securities Times | | Designated website for semi-annual report by CSRC | www.sse.com.cn | | Location for semi-annual report availability | Company's Securities Department | | Index for inquiry of changes during the reporting period | None | Company Stock Profile This section provides the listing information for the company's stock Company Stock Information | Stock Type | Stock Exchange | Stock Ticker | Stock Code | Previous Stock Ticker | | :--- | :--- | :--- | :--- | :--- | | A-Share | Shanghai Stock Exchange | Jinxi Axle | 600495 | | Key Accounting Data and Financial Indicators During the period, revenue decreased by 14.46% year-over-year, while net profit attributable to shareholders grew by 103.65%, and net cash flow from operating activities turned negative Key Accounting Data (H1 2018) | Key Accounting Data | Current Period (Jan-Jun) | Prior Year Period | Change YoY (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 551,805,666.81 | 645,089,776.46 | -14.46 | | Net Profit Attributable to Shareholders | 27,110,213.48 | 13,312,250.93 | 103.65 | | Net Profit Attributable to Shareholders (Excluding Non-recurring Items) | 4,365,811.20 | 3,320,384.10 | 31.49 | | Net Cash Flow from Operating Activities | -31,717,265.81 | 145,617,504.45 | -121.78 | | As of the end of the reporting period | | | | | Net Assets Attributable to Shareholders | 3,136,730,087.36 | 3,121,127,049.49 | 0.50 | | Total Assets | 3,976,441,038.41 | 3,838,442,762.55 | 3.60 | Key Financial Indicators (H1 2018) | Key Financial Indicators | Current Period (Jan-Jun) | Prior Year Period | Change YoY (%) | | :--- | :--- | :--- | :--- | | Basic Earnings Per Share (RMB/Share) | 0.02 | 0.01 | 100.00 | | Diluted Earnings Per Share (RMB/Share) | 0.02 | 0.01 | 100.00 | | Basic EPS (Excluding Non-recurring Items) (RMB/Share) | 0.004 | 0.003 | 33.33 | | Weighted Average Return on Equity (%) | 0.87 | 0.43 | Increased by 0.44 percentage points | | Weighted Average ROE (Excluding Non-recurring Items) (%) | 0.14 | 0.11 | Increased by 0.03 percentage points | Non-recurring Profit and Loss Items and Amounts This section details non-recurring profit and loss items totaling RMB 22.74 million, which significantly impacted net profit Non-recurring Profit and Loss Items (H1 2018) | Non-recurring Profit and Loss Item | Amount (RMB) | | :--- | :--- | | Gains and losses on disposal of non-current assets | -301,263.41 | | Government grants recognized in current profit or loss (excluding those closely related to normal business operations and received based on standard quotas or quantities) | 837,871.44 | | Other non-operating income and expenses beyond the above items | 294,719.29 | | Other profit and loss items that meet the definition of non-recurring profit and loss | 23,995,273.43 | | Income tax impact | -2,082,198.47 | | Total | 22,744,402.28 | Section 3 Company Business Summary This section outlines the company's primary operations, business model, industry context, and core competitive strengths Main Business, Operating Model, and Industry Overview The company develops and sells railway vehicle components and precision forgings through a vertically integrated model, facing new opportunities from the national freight increment action plan - The company's main business includes the R&D, manufacturing, sales, and technical consulting services for railway vehicle components (axles, bolsters, side frames, wheelsets, bogies), precision forgings, and precision castings[22] - The company operates under a vertically integrated business model, covering R&D, manufacturing, sales, and after-sales service, positioning it as a specialized manufacturer with a comprehensive industry chain[22] - China Railway Corporation's "2018-2020 Freight Increment Action Plan" aims to increase national railway freight volume to 4.79 billion tons by 2020, a 30% increase from 2017, which is expected to significantly boost demand for railway freight cars and locomotives over the next three years[23] Major Changes in Main Assets No significant changes occurred in the company's main assets during the reporting period - No major changes occurred in the company's main assets during the reporting period[24] Core Competitiveness Analysis With nearly four decades of experience, the company holds a leading domestic market share in railway axles and maintains a strong international competitive position - The company has consistently ranked first in the domestic industry for its R&D capabilities, technical standards, product quality, production scale, and market share in railway axle products[24] - The company represents China's competitiveness in this sector on the international stage, with its core competitiveness continuing to strengthen during the reporting period[24] Section 4 Management Discussion and Analysis This section discusses the company's operational performance, financial condition, investment activities, and risk factors for the reporting period Business Overview The company achieved orderly production and R&D progress, reporting revenue of RMB 552 million, a 14.46% decrease, and net profit of RMB 27.11 million, a 103.65% increase - In the first half of the year, the company generated operating revenue of RMB 551.81 million, a year-over-year decrease of 14.46%[27] - Net profit attributable to shareholders for the first half of the year was RMB 27.11 million, a year-over-year increase of 103.65%[27] Analysis of Main Business Operations Revenue and costs declined due to lower sales, while financial expenses fell sharply due to reduced exchange losses, and operating cash flow turned negative from decreased sales collections Analysis of Changes in Financial Statement Items (H1 2018) | Item | Current Period (RMB) | Prior Year Period (RMB) | Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 551,805,666.81 | 645,089,776.46 | -14.46 | | Operating Costs | 448,038,432.17 | 544,374,480.80 | -17.70 | | Selling Expenses | 11,568,160.25 | 14,631,621.22 | -20.94 | | Administrative Expenses | 82,771,257.99 | 78,667,928.33 | 5.22 | | Finance Expenses | 436,239.36 | 2,292,589.49 | -80.97 | | Net Cash Flow from Operating Activities | -31,717,265.81 | 145,617,504.45 | -121.78 | | Net Cash Flow from Investing Activities | -56,128,412.46 | -5,131,816.87 | — | | Net Cash Flow from Financing Activities | 19,755,275.00 | -38,173,586.00 | — | | R&D Expenditure | 35,468,109.50 | 28,646,759.65 | 23.81 | - The decrease in operating revenue and costs was primarily due to lower sales volumes of railway axles and vehicles[29] - The change in finance expenses was mainly driven by reduced net foreign exchange losses and increased interest income compared to the prior period[29] - The decline in net cash flow from operating activities was primarily caused by a decrease in cash collections from sales[29] - The increase in R&D expenditure was mainly due to increased investment after the subsidiary Jinxi Equipment officially commenced production[29] Analysis of Assets and Liabilities The company's balance sheet saw significant shifts, including a 48.88% drop in notes receivable, a 39.33% rise in fixed assets, and a 47.00% decrease in construction in progress Changes in Assets and Liabilities (H1 2018) | Item Name | End of Period (RMB) | % of Total Assets | End of Prior Period (RMB) | % of Total Assets | Change (%) | Explanation | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Notes Receivable | 75,930,139.10 | 1.91 | 148,546,340.72 | 3.87 | -48.88 | Mainly due to the collection of matured notes | | Accounts Receivable | 446,096,033.37 | 11.22 | 324,568,184.39 | 8.46 | 37.44 | Mainly due to increased outstanding payments for railway vehicle products | | Prepayments | 46,753,053.87 | 1.18 | 32,401,712.46 | 0.84 | 44.29 | Mainly due to increased prepayments for materials | | Interest Receivable | 15,726,863.05 | 0.40 | 3,587,292.11 | 0.09 | 338.40 | Mainly due to increased interest from wealth management products | | Other Receivables | 16,521,342.68 | 0.42 | 6,973,701.42 | 0.18 | 136.91 | Mainly due to an increase in inter-company transactions | | Fixed Assets | 1,033,220,547.42 | 25.98 | 741,556,859.74 | 19.32 | 39.33 | Mainly due to the capitalization of the completed rail transit and high-end equipment manufacturing base project | | Construction in Progress | 271,079,584.41 | 6.82 | 511,494,367.71 | 13.33 | -47.00 | Mainly due to the capitalization of the completed rail transit and high-end equipment manufacturing base project | | Short-term Borrowings | 20,000,000.00 | 0.50 | 0 | - | - | Subsidiary Jinxi Equipment obtained a new short-term loan from Binggong Finance | | Accounts Payable | 325,011,971.53 | 8.17 | 227,267,619.02 | 5.92 | 43.01 | Mainly due to increased payables for materials | | Advances from Customers | 56,641,829.99 | 1.42 | 40,377,085.59 | 1.05 | 40.28 | Mainly due to increased prepayments received for axle products | | Employee Benefits Payable | 11,017,742.19 | 0.28 | 7,891,705.76 | 0.21 | 39.61 | Mainly due to unreimbursed payments for basic pension insurance | | Taxes Payable | 5,023,480.56 | 0.13 | 15,332,970.13 | 0.40 | -67.24 | Mainly due to a decrease in VAT and corporate income tax payable | | Other Payables | 52,012,484.50 | 1.31 | 25,571,231.29 | 0.67 | 103.40 | Mainly due to increased payables for construction projects | | Special Reserves | 2,352,723.20 | 0.06 | 1,781,955.83 | 0.05 | 32.03 | Mainly due to an increase in the balance of safety production funds | Investment Analysis The company did not engage in any major equity or non-equity investments during the reporting period - The company had no significant equity investments, non-equity investments, or financial assets measured at fair value during the reporting period[35] Analysis of Major Subsidiaries and Investees The main subsidiary, Jinxi Railway Vehicle, reported revenue of RMB 383 million and net profit of RMB 36 million, while two other subsidiaries incurred net losses Operating Performance of Major Subsidiaries and Investees (H1 2018) | Company Name | Main Products | Registered Capital (RMB 10k) | Operating Revenue (RMB 10k) | Net Profit (RMB 10k) | Total Assets (RMB 10k) | Net Assets (RMB 10k) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Jinxi Railway Vehicle Co, Ltd | Railway vehicles, wheelsets (axles), bogies | 13,000 | 38,260 | 3,603 | 99,498 | 56,112 | | Baotou North Railway Products Co, Ltd | Railway axles, small and medium-sized forgings | 6,640 | 1,330 | -1,547 | 26,096 | -8,092 | | Jinxi Equipment Manufacturing Co, Ltd | Railway vehicle parts, castings, forgings, precision forgings | 40,000 | 2,938 | -1,368 | 49,537 | 36,551 | Potential Risks The company faces risks from policy changes, market competition, product quality, and currency fluctuations, and has implemented corresponding mitigation strategies - Policy and Industry Risks: The company's business is highly susceptible to national industrial policies and macroeconomic conditions, with potential adverse effects from changes in monetary policy, railway investment scale, and raw material costs; countermeasures include strengthening communication and adjusting marketing strategies[38] - Market Competition and Operational Risks: A global economic slowdown and US-China trade friction may impact the profitability and market share of foreign trade products; countermeasures include market research, product structure optimization, and enhancing technological innovation[38][39] - Product Quality Risks: The quality of railway and urban rail transit products is critical to operational safety, and quality issues could have severe negative consequences; countermeasures include reinforcing quality control systems and improving after-sales service[39] - Exchange Rate Fluctuation Risks: Global economic volatility and changes in monetary policy could increase foreign exchange risks in international trade, reducing export competitiveness; countermeasures include monitoring financial markets, using currency hedging, and strengthening capital management[39][40] Section 5 Important Matters This section covers significant corporate events during the period, including shareholder meetings, dividend policies, commitments, and environmental information Shareholder Meetings The company held its first extraordinary general meeting of 2018 and its 2017 annual general meeting during the reporting period Shareholder Meeting Details | Meeting | Date Held | Resolution Publication Website | Publication Date | | :--- | :--- | :--- | :--- | | 2018 First Extraordinary General Meeting | March 27, 2018 | www.sse.com.cn | March 29, 2018 | | 2017 Annual General Meeting | May 16, 2018 | www.sse.com.cn | May 17, 2018 | Profit Distribution or Capitalization of Capital Reserve Plan The company will not distribute profits or capitalize its capital reserve for the first half of the year - The company's semi-annual profit distribution or capitalization of capital reserve plan is "No", with zero bonus shares, dividends, or capitalization per 10 shares[43] Fulfillment of Commitments The controlling shareholder, Jinxi Industries Group, continued to strictly fulfill its long-term commitments to resolve horizontal competition and property title defects - Jinxi Industries Group Co, Ltd has made a long-term commitment not to engage in business that competes with Jinxi Axle and to bear all losses resulting from any breach of this commitment[44] - Jinxi Industries Group Co, Ltd has made a long-term commitment to resolve the issue of eight workshops lacking property certificates due to the separation of land and building rights and to compensate for any related penalties[44] Appointment and Dismissal of Accounting Firm No changes were made to the company's accounting firm during the period, and no "non-standard audit report" was issued for the previous year's financial statements - The company did not appoint or dismiss any accounting firm during the reporting period[45] Bankruptcy and Reorganization Matters The company had no bankruptcy or reorganization matters during the reporting period - The company had no bankruptcy or reorganization matters during the reporting period[46] Major Litigation and Arbitration The company was not involved in any major litigation or arbitration during the reporting period - The company was not involved in any major litigation or arbitration during the reporting period[46] Penalties and Rectifications No penalties or rectification orders were issued to the company or its key personnel during the reporting period - The company, its directors, supervisors, senior management, controlling shareholder, and actual controller were not subject to any penalties or rectifications during the reporting period[46] Integrity Status The company and its controlling shareholder maintained a good integrity record with no unfulfilled court judgments or overdue major debts - During the reporting period, the company and its controlling shareholder and actual controller had no unfulfilled court judgments or large overdue debts[46] Equity Incentive and Employee Stock Ownership Plans The company did not implement any equity incentive plans, employee stock ownership plans, or other employee incentive measures - The company had no equity incentive plans, employee stock ownership plans, or other employee incentive measures during the reporting period[47] Major Related-Party Transactions The company's routine related-party transactions included a planned sale of goods to Taiyuan Huanjin Renewable Energy Co, Ltd for an estimated RMB 50 million, with no progress during the period - The company's 2018 routine related-party transaction plan included an estimated sale of products and goods worth RMB 50 million to Taiyuan Huanjin Renewable Energy Co, Ltd, with no progress on this transaction during the reporting period[47] Major Contracts and Their Performance The company had no external guarantees but provided guarantees to its subsidiaries, with an outstanding balance of RMB 165 million, representing 6.04% of net assets Company's Total Guarantee Amount (H1 2018) | Indicator | Amount (RMB) | | :--- | :--- | | Total guarantees provided to subsidiaries during the reporting period | 99,276,644.07 | | Outstanding guarantee balance for subsidiaries at the end of the period (B) | 165,418,097.10 | | Total guarantee amount (A+B) | 165,418,097.10 | | Total guarantee amount as a percentage of company's net assets (%) | 6.04 | Poverty Alleviation Efforts The company fulfilled its social responsibilities by providing assistance totaling RMB 66,600 to employees in need and plans to continue these efforts - During the reporting period, the company provided assistance and medical mutual aid to 23 employees in difficulty, 19 of their children, and 37 hospitalized employees, with a total amount of RMB 66,600[51] Precision Poverty Alleviation Results (H1 2018) | Indicator | Amount and Details | | :--- | :--- | | I. Overall Situation: Funds | RMB 66,600 | | II. Itemized Investment: Education - Amount for subsidizing students in poverty | RMB 10,500 | | II. Itemized Investment: Education - Number of students subsidized | 19 | | II. Itemized Investment: Other Projects - Amount invested | RMB 56,100 | | II. Itemized Investment: Other Projects Description | During the reporting period, the company provided assistance to employees in difficulty and medical aid to hospitalized employees | - The company plans to continue improving its assistance mechanism and carry out integrated support work including poverty alleviation, educational grants, and employee mutual insurance[55] Environmental Information The company adheres to environmental regulations, ensuring compliant pollutant discharge through process controls and the use of clean energy in its new manufacturing base - The company's main pollutants are wastewater, exhaust gas, and solid waste; production wastewater is recycled, domestic sewage is treated, exhaust gas is filtered, and solid waste is comprehensively utilized or properly disposed of[56] - The rail transit and high-end equipment manufacturing base project is equipped with dust removal facilities and uses clean energy (natural gas), significantly reducing pollutant emissions[57] - The company has established comprehensive environmental risk prevention measures and emergency plans, conducting regular drills to ensure preparedness[58] Other Major Matters No changes in accounting policies or estimates, nor any major accounting error corrections, occurred during the reporting period - There were no changes in the company's accounting policies, estimates, or methods during the reporting period[59] - No major accounting errors requiring retrospective restatement were identified during the reporting period[59] Section 6 Changes in Common Stock and Shareholder Information This section details the company's share capital structure and provides information on its major shareholders Share Capital Changes The company's total number of shares and share capital structure remained unchanged during the reporting period - The company's total number of shares and share capital structure did not change during the reporting period[60] Shareholder Information As of the period end, Jinxi Industries Group held a 30.79% stake as the controlling shareholder, with several other state-owned entities among the top ten shareholders Top Ten Shareholders (End of H1 2018) | Shareholder Name | Shares Held at Period End | Percentage (%) | Shareholder Type | | :--- | :--- | :--- | :--- | | Jinxi Industries Group Co, Ltd | 372,014,755 | 30.79 | State-owned legal entity | | Wang Yong | 7,466,400 | 0.62 | Other | | Wang Yan | 3,690,000 | 0.31 | Other | | Yu Yajie | 2,881,295 | 0.24 | Other | | Shanxi Jiangyang Chemical Co, Ltd | 2,641,153 | 0.22 | State-owned legal entity | | Liu Jian | 2,560,000 | 0.21 | Other | | Guo Mingyue | 1,855,400 | 0.15 | Other | | Guo Chengliang | 1,110,000 | 0.15 | Other | | China North Industries Materials North China Co, Ltd | 1,721,088 | 0.14 | State-owned legal entity | | Dou Zhenjiang | 1,568,882 | 0.13 | Other | - As of the end of the reporting period, the ultimate controller of Jinxi Industries Group Co, Ltd, Shanxi Jiangyang Chemical Co, Ltd, and China North Industries Materials North China Co, Ltd is China North Industries Group Corporation Limited[63] Section 7 Preferred Stock Information The company had no preferred stock-related matters during the reporting period - The company had no preferred stock-related matters during the reporting period[66] Section 8 Directors, Supervisors, and Senior Management This section details changes in the holdings and composition of the company's board of directors, board of supervisors, and senior management team Changes in Shareholdings There were no changes in the shareholdings of current or former directors, supervisors, and senior management during the reporting period - The shareholdings of current and former directors, supervisors, and senior management remained unchanged during the reporting period[66] Changes in Directors, Supervisors, and Senior Management The company elected its sixth-term Board of Directors and Board of Supervisors and appointed new senior management, resulting in multiple personnel changes Changes in Directors, Supervisors, and Senior Management | Name | Position | Change Type | | :--- | :--- | :--- | | Zhang Chaohong | Chairman | Elected | | Yao Junkui | Director | Elected | | Kong Jionggang | Director | Elected | | Zhang Guoping | Director | Elected | | Zheng Weijun | Independent Director | Elected | | Li Gang | Independent Director | Elected | | Liu Xiaohong | Independent Director | Elected | | Yao Zhong | Chairman of the Supervisory Board | Elected | | Xing Jianzhong | Supervisor | Elected | | Zhang Shuzhen | Employee Supervisor | Elected | | Kong Jionggang | General Manager | Appointed | | Zhou Haihong | Board Secretary | Appointed | | Cheng Ping | Deputy General Manager | Appointed | | Wu Buwen | Deputy General Manager | Appointed | | Han Qiushi | Chief Financial Officer | Appointed | | Liu Tie | Deputy General Manager | Appointed | | Si Jinheng | Deputy General Manager | Appointed | | Pan Pingying | Director | Resigned | | Zhi Huisheng | Deputy General Manager | Resigned | | Liu Tiancheng | Deputy General Manager | Resigned | | Lv Xianlong | Deputy General Manager | Resigned | - On May 16, 2018, the company held its 2017 Annual General Meeting to elect the sixth Board of Directors and Supervisory Board, followed by the appointment of senior management on May 21, 2018[66] Section 9 Corporate Bonds The company had no corporate bond-related matters during the reporting period - The company had no corporate bond-related matters during the reporting period[69] Section 10 Financial Report This section presents the unaudited financial statements, accounting policies, and detailed notes for the reporting period Audit Report This semi-annual report has not been audited - This semi-annual report is unaudited[70] Financial Statements This section contains the consolidated and parent company financial statements for the first half of 2018, including the balance sheet, income statement, cash flow statement, and statement of changes in equity Consolidated Balance Sheet As of June 30, 2018, consolidated total assets were RMB 3.98 billion, an increase of 3.60%, while total liabilities grew by 17.07% to RMB 840 million - As of June 30, 2018, the company's consolidated total assets were RMB 3.98 billion, an increase of 3.60% from the beginning of the year[17][72] - As of June 30, 2018, the company's consolidated total liabilities were RMB 839.71 million, an increase of 17.07% from the beginning of the year[72] - As of June 30, 2018, equity attributable to parent company shareholders was RMB 3.14 billion, an increase of 0.50% from the beginning of the year[17][72] Parent Company Balance Sheet As of June 30, 2018, the parent company's total assets were RMB 3.08 billion, up 2.41%, while total liabilities increased by 22.89% to RMB 341 million - As of June 30, 2018, the parent company's total assets were RMB 3.08 billion, an increase of 2.41% from the beginning of the year[76] - As of June 30, 2018, the parent company's total liabilities were RMB 340.54 million, an increase of 22.89% from the beginning of the year[76] - As of June 30, 2018, the parent company's total equity was RMB 2.74 billion, an increase of 0.33% from the beginning of the year[76] Consolidated Income Statement For H1 2018, consolidated revenue was RMB 552 million, down 14.46% YoY, while net profit attributable to parent company shareholders rose 103.65% to RMB 27.11 million - For H1 2018, the company's consolidated total operating revenue was RMB 551.81 million, a year-over-year decrease of 14.46%[78] - For H1 2018, net profit attributable to parent company shareholders was RMB 27.11 million, a year-over-year increase of 103.65%[79] - For H1 2018, basic earnings per share was RMB 0.02, a year-over-year increase of 100%[79] Parent Company Income Statement For H1 2018, the parent company's revenue was RMB 186 million, down 21.98% YoY, while net profit was RMB 21.13 million, up 0.87%, supported by a 39.78% increase in investment income - For H1 2018, the parent company's operating revenue was RMB 185.88 million, a year-over-year decrease of 21.98%[81] - For H1 2018, the parent company's net profit was RMB 21.13 million, a year-over-year increase of 0.87%[81] - For H1 2018, the parent company's investment income was RMB 34.18 million, a year-over-year increase of 39.78%[81] Consolidated Cash Flow Statement For H1 2018, net cash flow from operating activities was -RMB 31.72 million, a 121.78% YoY decrease, while financing cash flow turned positive to RMB 19.76 million - For H1 2018, the company's consolidated net cash flow from operating activities was -RMB 31.72 million, a year-over-year decrease of 121.78%[83] - For H1 2018, consolidated net cash flow from investing activities was -RMB 56.13 million, compared to -RMB 5.13 million in the prior year period, mainly due to increased purchases of wealth management products[29][83] - For H1 2018, consolidated net cash flow from financing activities was RMB 19.76 million, compared to -RMB 38.17 million in the prior year period, mainly due to new short-term borrowings by the subsidiary Jinxi Equipment[29][83] Parent Company Cash Flow Statement For H1 2018, the parent company's operating cash flow was -RMB 28.49 million, a 134.25% YoY decrease, while investing cash flow turned negative to -RMB 40.93 million - For H1 2018, the parent company's net cash flow from operating activities was -RMB 28.49 million, a year-over-year decrease of 134.25%[87] - For H1 2018, the parent company's net cash flow from investing activities was -RMB 40.93 million, compared to RMB 2.98 million in the prior year period[87] - For H1 2018, the parent company's net cash flow from financing activities was RMB 0, compared to -RMB 38.17 million in the prior year period[87] Consolidated Statement of Changes in Equity For H1 2018, consolidated total equity increased by RMB 15.60 million, driven by net profit and an increase in special reserves, partially offset by profit distribution - Total comprehensive income attributable to parent company shareholders for the period was RMB 27.11 million[90] - During the period, RMB 10.33 million was transferred to surplus reserve, and RMB 12.08 million was distributed as dividends to owners[90] - Special reserves increased by RMB 0.57 million during the period[89][91] Parent Company Statement of Changes in Equity For H1 2018, the parent company's total equity increased by RMB 9.14 million, driven by net profit and an increase in special reserves, partially offset by profit distribution - Total comprehensive income for the parent company for the period was RMB 21.13 million[97] - During the period, RMB 10.33 million was transferred to surplus reserve, and RMB 12.08 million was distributed as dividends to owners[97] - Special reserves increased by RMB 95,241 during the period[97][98] Company Basic Information Jinxi Axle, established in 2000, operates in the transportation equipment manufacturing industry with a total share capital of 1.21 billion shares and several key subsidiaries - Jinxi Axle Company Limited was established in 2000 with the approval of the State Economic and Trade Commission, with an initial registered capital of RMB 62.91 million[100] - After several additional share issuances and capitalization of reserves, the company's total share capital reached 1.208 billion shares as of July 9, 2015[101][102] - The company's business scope includes the production and sale of railway vehicle components, axles, and precision forgings, classifying it within the transportation equipment manufacturing industry[103] - The scope of consolidation includes subsidiaries such as Jinxi Railway Vehicle Co, Ltd, Baotou North Railway Products Co, Ltd, Jinxi Equipment Manufacturing Co, Ltd, and Jinxi Axle International Limited[104][105] Basis of Preparation of Financial Statements The financial statements are prepared on a going concern basis in accordance with China's Accounting Standards for Business Enterprises, using the accrual basis and historical cost principle - 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 relevant CSRC disclosure rules[106] - The company uses the accrual basis of accounting, and the financial statements are prepared under the historical cost principle, except for certain financial instruments[106] - There are no events or conditions that cast significant doubt on the company's ability to continue as a going concern for at least 12 months from the end of the reporting period[107] Significant Accounting Policies and Estimates This section details the company's specific accounting policies and significant estimates for revenue recognition, business combinations, financial instruments, fixed assets, and other key areas - The company has formulated specific accounting policies and estimates for revenue recognition and other areas based on its operational characteristics in the railway vehicle components and precision forgings business[108] - The company's financial statements comply with the requirements of corporate accounting standards, presenting a true and fair view of its financial position, operating results, and cash flows[109] - The company makes judgments, estimates, and assumptions for items that cannot be precisely measured, including lease classification, bad debt provisions, inventory write-downs, fair value of financial instruments, impairment of long-term assets, depreciation, and deferred taxes[193][194][195][196][197][198] Taxes The company's main taxes include VAT and corporate income tax, with the company and a key subsidiary benefiting from a reduced 15% income tax rate as high-tech enterprises Main Taxes and Rates | Tax Type | Tax Basis | Rate | | :--- | :--- | :--- | | Value-Added Tax (VAT) | Output tax is calculated based on taxable income at the applicable rate, net of deductible input tax for the current period | | | Urban Maintenance and Construction Tax | Actual amount of turnover tax paid | 7% | | Corporate Income Tax | Taxable income | 15%, 25% | | Education Surcharge | Actual amount of turnover tax paid | 3%, 2% | | Water Conservancy Construction Fund | Based on operating revenue | 0.1% | Corporate Income Tax Rates for Different Entities | Taxpayer Name | Income Tax Rate (%) | | :--- | :--- | | Jinxi Axle Company Limited | 15 | | Jinxi Railway Vehicle Co, Ltd | 15 | | Baotou North Railway Products Co, Ltd | 25 | | Jinxi Equipment Manufacturing Co, Ltd | 25 | | Jinxi Axle International Limited | 0 | | Jinxi Axle (Hong Kong) Co, Limited | 16.50 | - The company and its subsidiary Jinxi Railway Vehicle Co, Ltd are recognized as high-tech enterprises and are subject to a reduced corporate income tax rate of 15% from 2017 to 2019[200] Notes to the Consolidated Financial Statements This section provides detailed disclosures for each item in the consolidated financial statements, including cash, receivables, inventory, fixed assets, and liabilities, with explanations for significant changes Cash and Cash Equivalents At period-end, cash and cash equivalents totaled RMB 207 million, a decrease of 26.81%, with RMB 6.44 million restricted for use as various deposits Cash and Cash Equivalents Details | Item | Period-End Balance (RMB) | Beginning Balance (RMB) | | :--- | :--- | :--- | | Cash on Hand | | 891.45 | | Bank Deposits | 200,394,399.02 | 269,292,701.27 | | Other Cash Equivalents | 6,436,439.53 | 13,275,611.83 | | Total | 206,830,838.55 | 282,569,204.55 | | Of which: total funds held overseas | 329,265.99 | 325,285.64 | - Other cash equivalents include RMB 6.44 million used as guarantee deposits, acceptance bill deposits, and letter of credit deposits, which are restricted in use[204] Notes Receivable At period-end, notes receivable totaled RMB 75.93 million, a 48.88% decrease, with RMB 6.40 million in notes endorsed or discounted but not yet matured Notes Receivable by Type | Item | Period-End Balance (RMB) | Beginning Balance (RMB) | | :--- | :--- | :--- | | Bank Acceptance Notes | 51,178,466.30 | 129,596,653.00 | | Commercial Acceptance Notes | 24,751,672.80 | 18,949,687.72 | | Total | 75,930,139.10 | 148,546,340.72 | Notes Receivable Endorsed or Discounted but Not Matured at Period-End | Item | Derecognized Amount at Period-End (RMB) | Not Derecognized Amount at Period-End (RMB) | | :--- | :--- | :--- | | Bank Acceptance Notes | 6,164,280.00 | | | Commercial Acceptance Notes | 239,600.00 | | | Total | 6,403,880.00 | | Accounts Receivable At period-end, the carrying value of accounts receivable was RMB 446 million, a 37.44% increase, with the top five customers accounting for 77.11% of the total balance Accounts Receivable by Category (End of H1 2018) | Category | Book Balance (RMB) | Provision for Bad Debts (RMB) | Carrying Value (RMB) | | :--- | :--- | :--- | :--- | | Accounts receivable with provision for bad debts made on a portfolio basis | 486,427,492.66 | 40,331,459.29 | 446,096,033.37 | | Total | 486,427,492.66 | 40,331,459.29 | 446,096,033.37 | Accounts Receivable with Provision for Bad Debts by Aging Analysis | Aging | Accounts Receivable (RMB) | Provision for Bad Debts (RMB) | Provision Rate (%) | | :--- | :--- | :--- | :--- | | Within 1 year | 439,743,433.74 | | | | 1 to 2 years | 5,445,486.85 | 1,089,097.37 | 20.00 | | 2 to 3 years | 3,992,420.30 | 1,996,210.15 | 50.00 | | Over 3 years | 37,246,151.77 | 37,246,151.77 | 100.00 | | Total | 486,427,492.66 | 40,331,459.29 | 8.29 | - The provision for bad debts made during the period amounted to RMB 1.09 million[213] - The total amount of the top five accounts receivable at period-end was RMB 375.11 million, representing 77.11% of the total accounts receivable balance[213] Prepayments At period-end, prepayments totaled RMB 46.75 million, a 44.29% increase, with the top five suppliers accounting for 91.23% of the total balance Prepayments by Aging | Aging | Amount (RMB) | Percentage (%) | | :--- | :--- | :--- | | Within 1 year | 25,694,573.42 | 54.96 | | 1 to 2 years | 272,550.34 | 0.58 | | 2 to 3 years | 6,301,126.84 | 13.48 | | Over 3 years | 14,484,803.27 | 30.98 | | Total | 46,753,053.87 | 100.00 | - The increase in prepayments was mainly due to higher advance payments for materials[33] - The total amount of the top five prepayments at period-end was RMB 42.65 million, representing 91.23% of the total prepayments balance[216] Interest Receivable At period-end, interest receivable totaled RMB 15.73 million, a significant increase of 338.40%, primarily due to higher income from wealth management products Interest Receivable by Type | Item | Period-End Balance (RMB) | Beginning Balance (RMB) | | :--- | :--- | :--- | | Interest on guarantee deposits | 686,904.41 | 686,904.41 | | Income from wealth management products | 15,039,958.64 | 2,900,387.70 | | Total | 15,726,863.05 | 3,587,292.11 | - The increase in interest receivable was mainly due to higher interest income from wealth management products[33] Other Receivables At period-end, the carrying value of other receivables was RMB 16.52 million, a 136.91% increase, with the top five balances accounting for 74.00% of the total Other Receivables by Category (End of H1 2018) | Category | Book Balance (RMB) | Provision for Bad Debts (RMB) | Carrying Value (RMB) | | :--- | :--- | :--- | :--- | | Other receivables with provision for bad debts made on a portfolio basis | 19,684,694.29 | 3,163,351.61 | 16,521,342.68 | | Total | 19,684,694.29 | 3,163,351.61 | 16,521,342.68 | Other Receivables by Nature | Nature of receivable | Period-End Book Balance (RMB) | Beginning Book Balance (RMB) | | :--- | :--- | :--- | | Petty cash | 2,920,311.18 | 2,937,452.68 | | Deposits | 644,735.56 | 674,410.84 | | Advances to employees | 545,285.92 | 586,193.42 | | Reclassified from prepayments | 536,182.54 | 536,182.54 | | Inter-company and other transactions | 15,038,179.09 | 5,468,960.90 | | Total | 19,684,694.29 | 10,203,200.38 | - The increase in other receivables was mainly due to an increase in inter-company transactions[33] - The total amount of the top five other receivables at period-end was RMB 14.57 million, representing 74.00% of the total other receivables balance[222] Inventories At period-end, the carrying value of inventories was RMB 645 million, a 9.27% increase, with a total provision for inventory write-down of RMB 43.66 million Inventories by Category (End of H1 2018) | Item | Book Balance (RMB) | Provision for Write-down (RMB) | Carrying Value (RMB) | | :--- | :--- | :--- | :--- | | Raw Materials | 343,514,797.73 | 4,105,386.91 | 339,409,410.82 | | Work in Progress | 137,015,395.85 | 5,759,065.86 | 131,256,329.99 | | Finished Goods | 207,772,309.40 | 33,799,231.62 | 173,973,077.78 | | Total | 688,302,502.98 | 43,663,684.39 | 644,638,818.59 | Changes in Provision for Inventory Write-down | Item | Beginning Balance (RMB) | Increase during the period (RMB) | Decrease during the period (RMB) | Period-End Balance (RMB) | | :--- | :--- | :--- | :--- | :--- | | Raw Materials | 5,038,023.01 | | 932,636.10 | 4,105,386.91 | | Work in Progress | 5,759,065.86 | | | 5,759,065.86 | | Finished Goods | 35,902,046.08 | 309,110.28 | 2,411,924.74 | 33,799,231.62 | | Total | 46,699,134.95 | 309,110.28 | 3,344,560.84 | 43,663,684.39 | Other Current Assets At period-end, other current assets totaled RMB 869 million, a 3.57% increase, primarily comprising RMB 830 million in wealth management products Other Current Assets by Type | Item | Period-End Balance (RMB) | Beginning Balance (RMB) | | :--- | :--- | :--- | | Deductible VAT input tax | 36,810,695.03 | 22,331,000.24 | | Input tax to be deducted | 703,471.05 | 570,239.88 | | Input tax to be certified | 123.81 | 111,604.34 | | Prepaid corporate income tax | 1,374,665.95 | 5,956,802.72 | | Wealth management products | 829,999,999.72 | 810,000,000.00 | | Total | 868,888,955.56 | 838,969,647.18 | Available-for-Sale Financial Assets At period-end, available-for-sale financial assets totaled RMB 179 million, unchanged from the beginning of the year, mainly consisting of investments in related financial institutions Available-for-Sale Financial Assets Measured at Cost at Period-End | Investee | Period-End Book Balance (RMB) | Shareholding (%) | Cash Dividend for the Period (RMB) | | :--- | :--- | :--- | :--- | | Binggong Finance Co, Ltd | 139,000,000.00 | 2.84 | 10,800,000.00 | | Shanghai Zhongbing Guotai Junan Investment Center (Limited Partnership) | 40,000,000.00 | 7.67 | | | Total | 179,000,000.00 | / | 10,800,000.00 | Fixed Assets At period-end, the carrying value of fixed assets was RMB 1.03 billion, a 39.33% increase, mainly due to the transfer of assets from construction in progress - The original value of fixed assets increased by RMB 322.23 million during the period, of which RMB 322.16 million was transferred from construction in progress[236] - Accumulated depreciation increased by RMB 30.05 million during the period[236] - The carrying value of fixed assets at period-end was RMB 1.03 billion, an increase of 39.33% from the beginning of the year[237] Construction in Progress At period-end, the carrying value of construction in progress was RMB 271 million, a 47.00% decrease, as the rail transit and high-end equipment manufacturing base project was partially completed and capitalized Construction in Progress Details (End of H1 2018) | Project | Book Balance (RMB) | Carrying Value (RMB) | | :--- | :--- | :--- | | Railway vehicle tank manufacturing and inspection workshop construction | 151,777.77 | 151,777.77 | | Rail transit and high-end equipment manufacturing base project | 226,015,725.88 | 226,015,725.88 | | Other | 44,912,080.76 | 44,912,080.76 | | Total | 271,079,584.41 | 271,079,584.41 | - The decrease in construction in progress was mainly due to the partial completion and capitalization of the rail transit and high-end equipment manufacturing base project[33] - The rail transit and high-end equipment manufacturing base project has a cumulative investment of 80.12% of its budget and is 95% complete[241] Intangible Assets At period-end, the carrying value of intangible assets was RMB 98.44 million, primarily consisting of land use rights and non-patented technology Intangible Assets Details (End of H1 2018) | Item | Period-End Carrying Value (RMB) | Beginning Carrying Value (RMB) | | :--- | :--- | :--- | | Land use rights | 96,806,395.37 | 97,890,961.85 | | Software | | | | Non-patented technology | 1,637,446.58 | 2,324,591.22 | | Total | 98,443,841.95 | 100,215,553.07 | - During the period, the original value of intangible assets increased by RMB 64,717, and accumulated amortization increased by RMB 1.84 million[243] Deferred Tax Assets/Liabilities At period-end, un-offset deferred tax assets totaled RMB 8.64 million, a 5.74% increase, mainly arising from provisions for bad debts and inventory write-downs Un-offset Deferred Tax Assets (End of H1 2018) | Item | Deductible Temporary Differences (RMB) | Deferred Tax Assets (RMB) | | :--- | :--- | :--- | | Provision for bad debts on receivables | 27,778,409.47 | 4,277,032.08 | | Provision for inventory write-down | 22,521,255.56 | 3,378,188.33 | | Employee benefits payable | 5,230,466.99 | 980,132.45 | | Total | 55,530,132.02 | 8,635,352.86 | Other Non-Current Assets At period-end, other non-current assets totaled RMB 34.68 million, a 14.29% decrease, consisting mainly of prepayments for construction and equipment Other Non-Current Assets Details | Item | Period-End Balance (RMB) | Beginning Balance (RMB) | | :--- | :--- | :--- | | Prepayments for construction and equipment | 34,675,667.00 | 40,455,891.47 | | Total | 34,675,667.00 | 40,455,891.47 | Short-term Borrowings At period-end, short-term borrowings totaled RMB 20 million, all of which were guaranteed loans obtained by the subsidiary Jinxi Equipment Short-term Borrowings by Type | Item | Period-End Balance (RMB) | Beginning Balance (RMB) | | :--- | :--- | :--- | | Guaranteed borrowings | 20,000,000.00 | | | Total | 20,000,000.00 | | - Short-term borrowings consist of a new RMB 20 million loan obtained by the subsidiary Jinxi Equipment from Binggong Finance during the period[29][33] Notes Payable At period-end, notes payable totaled RMB 304 million, a 12.72% decrease, with RMB 2.18 million in notes past due but unpaid Notes Payable by Type | Type | Period-End Balance (RMB) | Beginning Balance (RMB) | | :--- | :--- | :--- | | Commercial acceptance notes | 97,958,780.54 | 165,348,812.76 | | Bank acceptance notes | 205,740,869.81 | 182,611,377.08 | | Total | 303,699,650.35 | 347,960,189.84 | - The total amount of notes payable past due but unpaid at the end of the period was RMB 2.18 million[249] Accounts Payable At period-end, accounts payable totaled RMB 325 million, a 43.01% increase, mainly due to higher payables for materials Accounts Payable Details | Item | Period-End Balance (RMB) | Beginning Balance (RMB) | | :--- | :--- | :--- | | Material costs | 276,257,001.14 | 200,134,126.67 | | Labor costs | 21,906,747.55 | 13,959,082.66 | | Repair costs | 5,075,984.77 | 5,373,553.00 | | Other miscellaneous fees | 21,772,238.07 | 7,800,856.69 | | Total | 325,011,971.53 | 227,267,619.02 | - The increase in accounts payable was mainly due to higher payables for materials[33] Significant Accounts Payable with Aging Over 1 Year | Creditor | Period-End Balance (RMB) | Reason for non-payment | | :--- | :--- | :--- | | Inner Mongolia North Heavy Industries Group Co, Ltd | 22,651,186.06 | Unsettled | | Beijing Nankou SKF Railway Bearing Co, Ltd | 2,413,880.00 | Unsettled | | Total | 25,065,066.06 | / | Advances from Customers At period-end, advances from customers totaled RMB 56.64 million, a 40.28% increase, mainly due to higher prepayments received for axle products Advances from Customers Details | Item | Period-End Balance (RMB) | Beginning Balance (RMB) | | :--- | :--- | :--- | | Payments for goods | 56,641,829.99 | 40,377,085.59 | | Total | 56,641,829.99 | 40,377,085.59 | - The increase in advances from customers was mainly due to higher prepayments received for axle products[33] Significant Advances from Customers with Aging Over 1 Year | Customer | Period-End Balance (RMB) | Reason for non-settlement | | :--- | :--- | :--- | | Taiyuan Huanjin Renewable Energy Co, Ltd | 20,446,000.00 | Contract not yet completed | | Daqin Railway Co, Ltd Taiyuan North Depot | 5,913,545.70 | Contract not yet completed | | Qingdao Ebara Environmental Equipment Co, Ltd | 5,291,940.00 | Contract not yet completed | | Wuxi Xuelang Environmental Technology Co, Ltd | 1,664,300.00 | Contract not yet completed | | Total | 33,315,785.70 | / | Employee Benefits Payable At period-end, employee benefits payable totaled RMB 11.02 million, a 39.61% increase, mainly due to unreimbursed pension insurance payments Employee Benefits Payable Details | Item | Beginning Balance (RMB) | Increase during the period (RMB) | Decrease during the period (RMB) | Period-End Balance (RMB) | | :--- | :--- | :--- | :--- | :--- | | I. Short-term benefits | 5,513,684.09 | 72,163,731.96 | 71,246,167.50 | 6,431,248.55 | | II. Post-employment benefits - defined contribution plans | 1,602,562.10 | 8,458,064.32 | 6,356,632.02 | 3,703,994.40 | | III. Termination benefits | 775,459.57 | 238,981.39 | 131,941.72 | 882,499.24 | | Total | 7,891,705.76 | 80,860,777.67 | 77,734,741.24 | 11,017,742.19 | - The increase in employee benefits payable was mainly due to unreimbursed payments for basic pension insurance[33] Taxes Payable At period-end, taxes payable totaled RMB 5.02 million, a 67.24% decrease, primarily due to lower VAT and corporate income tax payable Taxes Payable Details | Item | Period-End Balance (RMB) | Beginning Balance (RMB) | | :--- | :--- | :--- | | Value-Added Tax | | 5,975,789.17 | | Corporate Income Tax | 609,115.13 | 2,515,139.05 | | Personal Income Tax | 152,148.49 | 444,841.62 | | Urban Maintenance and Construction Tax | | 418,305.24 | | Land Use Tax | 4,260,079.20 | 5,680,105.59 | | Education Surcharge | | 298,789.46 | | Water Conservancy Construction Fund | 2,137.74 | | | Total | 5,023,480.56 | 15,332,970.13 | - The decrease in taxes payable was mainly due to lower VAT and corporate income tax payable[33] Dividends Payable At period-end, the company had dividends payable on common stock amounting to RMB 12.08 million Dividends Payable Details | Item | Period-End Balance (RMB) | Beginning Balance (RMB) | | :--- | :--- | :--- | | Common stock dividends | 12,081,908.86 | | | Total | 12,081,908.86 | | Other Payables At period-end, other payables totaled RMB 52.01 million, a 103.40% increase, mainly due to higher payables for construction projects Other Payables by Nature | Item | Period-End Balance (RMB) | Beginning Balance (RMB) | | :--- | :--- | :--- | | Deposits received | 520,000.00 | 520,000.00 | | Payables for construction projects | 48,640,637.55 | 23,415,637.29 | | Risk deposits | 559,800.00 | 257,800.00 | | Other | 2,292,046.95 | 1,377,794.00 | | Total | 52,012,484.50 | 25,571,231.29 | - The increase in other payables was mainly due to higher payables for construction projects[33] Long-term Employee Benefits Payable At period-end, long-term employee benefits payable totaled RMB 4.01 million, an 88.82% increase, representing future termination benefits for early-retired employees Long-term Employee Benefits Payable Details | Item | Period-End Balance (RMB) | Beginning Balance (RMB) | | :--- | :--- | :--- | | II. Termination benefits | 4,008,343.19 | 2,122,800.11 | | Total | 4,008,343.19 | 2,122,800.11 | - Termination benefits payable more than twelve months after the balance sheet date are classified as long-term employee benefits payable[270] Special Payables At period-end, special payables totaled RMB 4.25 million, unchanged from the beginning of the year, consisting of funds for civilian product technology development Special Payables Details | Item | Beginning Balance (RMB) | Increase during the period (RMB) | Decrease during the period (RMB) | Period-End Balance (RMB) | | :--- | :--- | :--- | :--- | :--- | | 2016 Group Company Civilian Product Technology Development Fund | 1,500,000.00 | | | 1,500,000.00 | | 2017 Group Company Civilian Product Technology Development Fund | 2,750,000.00 | | | 2,750,000.00 | | Total | 4,250,000.00 | | | 4,250,000.00 | - Special payables primarily consist of funds allocated by China North Industries Group Corporation Limited for civilian product technology development projects[271] Deferred Income At period-end, deferred income totaled RMB 45.96 million, primarily consisting of government grants for various technology and manufacturing projects Deferred Income Details | Item | Beginning Balance (RMB) | Increase during the period (RMB) | Decrease during the period (RMB) | Period-End Balance (RMB) | Reason | | :--- | :--- | :--- | :--- | :--- | :--- | | Government grants | 46,542,111.32 | 250,000.00 | 828,571.44 | 45,963,539.88 | | | Total | 46,542,111.32 | 250,000.00 | 828,571.44 | 45,963,539.88 | / | Projects Involving Government Grants | Liability Item | Beginning Balance (RMB) | New Grants (RMB) | Recognized as Non-operating Income (RMB) | Period-End Balance (RMB) | Asset-related/Income-related | | :--- | :--- | :--- | :--- | :--- | :--- | | Blanken wheelset R&D and trial production grant | 6,080,000.00 | | | 6,080,000.00 | Asset-related | | 2016 Green Manufacturing System Integration Fund | 13,500,000.00 | | | 13,500,000.00 | Asset-related | | Key Complex Casting Green Manufacturing Process and Equipment Fund | 10,000,000.00 | | | 10,000,000.00 | Asset-related | | 2017 Shanxi Province Technical Transformation Fund | 500,000.00 | | | 500,000.00 | Asset-related | | EMU and heavy-haul freight car axle development and industrialization project | 843,540.00 | | | 843,540.00 | Income-related | | "Steel for key railway vehicle components in harsh environments" project | 290,000.00 | 250,000.00 | | 540,000.00 | Income-related | | Key industry revitalization and technical transformation central budget investment project | 15,328,571.32 | | 828,571.44 | 14,499,999.88 | Asset-related | | Total | 46,542,111.32 | 250,000.00 | 828,571.44 | 45,963,539.88 | / | Share Capital At period-end, the company's total share capital was 1.21 billion shares, with no changes during the reporting period Share Capital Details | Item | Beginning Balance (RMB) | Change during the period (+, -) | Period-End Balance (RMB) | | :--- | :--- | :--- | :--- | | Total Shares | 1,208,190,886.00 | | 1,208,190,886.00 | Capital Reserve At period-end, the company's capital reserve totaled RMB 1.16 billion, unchanged from the beginning of the year, primarily consisting of share premium Capital Reserve Details | Item | Beginning Balance (RMB) | Increase during the period (RMB) | Decrease during the period (RMB) | Period-End Balance (RMB) | | :--- | :--- | :--- | :--- | :--- | | Share premium | 1,160,026,973.28 | | | 1,160,026,973.28 | | Other capital reserves | 108,113.24 | | | 108,113.24 | | Total | 1,160,135,086.52 | | | 1,160,135,086.52 | Other Comprehensive Income At period-end, other comprehensive income was RMB 25,734, reflecting a slight increase due to foreign currency translation differences Other Comprehensive Income Details | Item | Beginning Balance (RMB) | Amount for the period (RMB) | Period-End Balance (RMB) | | :--- | :--- | :--- | :--- | | II. OCI to be reclassified to profit or loss | 21,768.28 | 3,965.88 | 25,734.16 | | Of which: Foreign currency translation differences | 21,768.28 | 3,965.88 | 25,734.16 | | Total Other Comprehensive Income | 21,768.28 | 3,965.88 | 25,734.16 | Special Reserves At period-end, special reserves totaled RMB 2.35 million, a 32.03% increase, mainly due to a higher balance in the safety production fund Special Reserves Details | Item | Beginning Balance (RMB) | Increase during the period (RMB) | Decrease during the period (RMB) | Period-End Balance (RMB) | | :--- | :--- | :--- | :--- | :--- | | Safety production fund | 1,781,955.83 | 2,742,804.77 | 2,172,037.40 | 2,352,723.20 | | Total | 1,781,955.83 | 2,742,804.77 | 2,172,037.40 | 2,352,723.20 | - The increase in special reserves was mainly due to a higher balance in the safety production fund[34] Surplus Reserve At period-end, the surplus reserve totaled RMB 199 million, a 5.47% increase, following a transfer of RMB 10.33 million to the discretionary surplus reserve Surplus Reserve Details | Item | Beginning Balance (RMB) | Increase d