WLGF(SH:603779)2018-08-28 16:00Financial Performance - The company's operating revenue for the first half of 2018 was CNY 405,622,043.88, representing a 2.81% increase compared to CNY 394,516,602.22 in the same period last year[19]. - The net profit attributable to shareholders for the first half of 2018 was CNY 29,638,423.19, which is a 12.82% increase from CNY 26,269,501.18 in the previous year[19]. - The net profit after deducting non-recurring gains and losses was CNY 30,799,060.64, up 14.36% from CNY 26,931,804.88 year-on-year[19]. - The company's total assets at the end of the reporting period were CNY 1,900,338,794.16, a 0.86% increase from CNY 1,884,113,805.57 at the end of the previous year[19]. - The net assets attributable to shareholders at the end of the reporting period were CNY 1,393,090,504.48, reflecting a 0.25% increase from CNY 1,389,555,220.74 at the end of the previous year[19]. - The weighted average return on net assets decreased to 2.11%, down 1.19 percentage points from 3.30% in the same period last year[20]. - The company reported a net cash flow from operating activities of -CNY 22,849,952.85, compared to CNY 30,929,623.10 in the same period last year, indicating a significant change in cash flow[19]. - The company achieved a significant reduction in financial expenses, decreasing by 49.83% compared to the previous year[38]. - The company reported a net cash flow from financing activities of CNY 18,096,537.11, compared to a negative cash flow in the previous year[38]. - The company reported a total profit of ¥42,561,856.00, up from ¥40,834,960.46, indicating a rise of 4.2%[94]. - The basic and diluted earnings per share remained stable at ¥0.13 for both periods[94]. - The company experienced a net increase in retained earnings of CNY 3,535,283.74 during the current period[106]. Market and Business Strategy - The company continues to focus on wine production and sales, with a complete industry chain from grape planting to sales[22]. - The domestic wine market is on an upward trend, with significant potential for growth in the domestic wine industry due to increasing consumer demand for high-quality products[23]. - The company has established its own organic grape planting bases in Gansu and Australia, enhancing its raw material supply capabilities[27]. - The company completed 20% of the progress on the 60,000-ton grape wine processing project in Australia during the reporting period[35]. - The company has a comprehensive marketing network covering the entire country, primarily based on a dealer model[28]. - The company plans to strengthen its existing market and explore new markets to increase market share[45]. - The company’s main business includes the processing and sales of wine and fruit wine, with a focus on expanding its market presence[115]. Costs and Expenses - The increase in operating costs is primarily due to the rise in revenue, especially from mid-to-high-end products[39]. - Sales expenses increased mainly due to higher promotional costs during the reporting period[39]. - Management expenses rose to ¥26,464,807.69 from ¥20,967,996.63, an increase of 26.2%[93]. - The company reported an increase in sales expenses to ¥114,301,344.50 from ¥106,871,142.14, reflecting a rise of 6.7%[93]. Cash Flow and Investments - The net cash flow from operating activities decreased due to increased payments for imported raw wine[39]. - The net cash flow from investing activities decreased due to increased investment in a 60,000-ton premium grape raw wine processing project in the Australian subsidiary[39]. - Cash outflow from investing activities totaled CNY 117,777,659.49, significantly higher than CNY 32,600,269.80 in the previous period[100]. - Cash inflow from financing activities was CNY 145,499,807.44, down from CNY 235,578,858.85 in the previous period, a decrease of approximately 38.3%[100]. Shareholder Information - Shareholders are allowed to reduce their holdings by up to 15% after a two-year lock-up period, with a minimum selling price not lower than the IPO price[52]. - The company plans to repurchase shares with a minimum of 10 million yuan if the stock price falls below the net asset value for 20 consecutive trading days[52]. - The controlling shareholder will also increase their stake in the company with at least 10 million yuan[52]. - The company has committed to not transferring or entrusting the management of its shares for 36 months post-IPO[51]. Environmental and Social Responsibility - The company has committed to ongoing technical guidance for local farmers to enhance income and improve living standards in impoverished areas[66]. - The company paid annual salaries of CNY 68,000 for two teachers at Suwu Mountain Primary School in Minqin County, a poverty-stricken area[62]. - The company purchased 3,026 tons of grapes from local farmers in Minqin County, totaling CNY 7.764 million, and plans to continue purchasing grapes this year[62]. - The company invested CNY 34,000 in poverty alleviation projects, including CNY 34,000 for improving educational resources in impoverished areas[64]. Compliance and Governance - The financial report was approved by the board of directors on August 28, 2018, ensuring compliance with accounting standards[116]. - The company maintains a continuous operation capability for at least 12 months following the reporting period[120]. - The company has no significant changes in profit composition or sources during the reporting period[40]. - There were no major litigation or arbitration matters during the reporting period[55]. Asset Management - The company has a total of CNY 76,770,295.07 in restricted assets due to collateralized loans[42]. - The total amount of guarantees provided by the company to subsidiaries during the reporting period was RMB 15,000,000[59]. - The total balance of guarantees to subsidiaries at the end of the reporting period was RMB 71,748,150[59]. - The company provided guarantees for its subsidiary Weilong Wines (Australia) Pty Ltd's vineyard to secure a loan from RABO Bank[59]. Accounting Policies - The company prepares consolidated financial statements in accordance with the relevant accounting standards, including eliminating intercompany transactions and unrealized profits[135]. - The company recognizes its share of assets and liabilities in joint operations according to relevant accounting standards[137]. - The company accounts for investments in joint ventures based on the level of influence it has over the joint venture[140]. - The company recognizes impairment losses on available-for-sale financial assets when the fair value declines significantly, defined as a cumulative drop exceeding 20%[158].