红旗连锁(002697) - 2014 Q2 - 季度财报

Important Notes, Table of Contents and Definitions This section provides essential disclaimers, the report's detailed table of contents, and definitions of key terms for clarity Important Notes The company's board of directors, supervisory board, and senior management guarantee the truthfulness, accuracy, and completeness of the semi-annual report content - The company's board of directors, supervisory board, and senior management guarantee the truthfulness, accuracy, and completeness of the semi-annual report content, with no false records, misleading statements, or major omissions, and assume individual and joint legal responsibility[3] - The profit distribution plan approved by this board meeting is to distribute a cash dividend of 0.54 Yuan (including tax) per 10 shares and transfer 10 shares from capital reserves per 10 shares, based on the company's total share capital of 400,000,000 shares as of June 30, 2014[4] Table of Contents This chapter lists the detailed directory structure of the 2014 semi-annual report, covering all content from important notes to the catalogue of documents for reference Definitions This chapter provides definitions for common terms used in the report, including company names, subsidiary names, relevant laws, regulations, and financial measurement units - The reporting period refers to January 1, 2014, to June 30, 2014[9] - "Company" or "the Company" refers to Chengdu Hongqi Chain Co., Ltd[9] - Names and definitions of several subsidiaries, including Hongqi Advertising, Hongqi Wholesale, and Sichuan Hongqi, are listed[9] Company Profile This section introduces the company's fundamental information, including its stock details, legal representatives, and contact information Company Basic Information This chapter introduces the company's basic overview, including its stock abbreviation, stock code, listing exchange, and legal representative - Company stock abbreviation: Chengdu Hongqi Chain Co., Ltd., stock code: 002697, listing exchange: Shenzhen Stock Exchange[12] - Company Chinese name: Chengdu Hongqi Chain Co., Ltd., Chinese abbreviation: Hongqi Chain[12] - Company legal representative: Cao Shiru[12] Contact Information and Information Disclosure This chapter provides contact information for the company's board secretary and securities affairs representative, confirming no changes in contact details or disclosure during the reporting period - Board Secretary: Cao Zengjun, contact number: 13808011321, email: zj@hqls.com.cn[13] - Securities Affairs Representative: Peng Longkai, contact number: 18980808880, email: shibaxueshi001@qq.com[13] - The company's registered address, office address, website, email, information disclosure newspaper, designated website, and registration status remained unchanged during the reporting period[14][15][16] Summary of Accounting Data and Financial Indicators This section presents a concise overview of the company's key financial performance and position indicators for the reporting period Key Accounting Data and Financial Indicators This chapter summarizes the company's key accounting data and financial indicators for the current reporting period, comparing them with the same period last year Key Accounting Data and Financial Indicators Comparison | Indicator | Current Reporting Period (Yuan) | Prior Year Same Period (Yuan) | YoY Change | | :--- | :--- | :--- | :--- | | Operating Revenue | 2,380,081,185.38 | 2,181,658,694.20 | 9.10% | | Net Profit Attributable to Shareholders of Listed Company | 106,227,233.29 | 103,086,596.10 | 3.05% | | Net Profit Attributable to Shareholders of Listed Company (Excluding Non-recurring Gains/Losses) | 82,054,173.82 | 101,771,791.47 | -19.37% | | Net Cash Flow from Operating Activities | 122,992,929.61 | 150,366,123.33 | -18.20% | | Basic Earnings Per Share (Yuan/share) | 0.27 | 0.26 | 3.85% | | Diluted Earnings Per Share (Yuan/share) | 0.27 | 0.26 | 3.85% | | Weighted Average Return on Net Assets | 5.82% | 5.93% | -0.11% | | Period-end Indicators | Current Period-end (Yuan) | Prior Year-end (Yuan) | Period-end YoY Change | | Total Assets | 2,907,601,287.25 | 2,861,347,501.34 | 1.62% | | Net Assets Attributable to Shareholders of Listed Company | 1,867,063,528.62 | 1,781,636,295.33 | 4.79% | Non-recurring Gains and Losses and Amounts This chapter details the composition and amounts of non-recurring gains and losses during the reporting period, with investment income and government subsidies being the primary sources Non-recurring Gains and Losses and Amounts | Item | Amount (Yuan) | Explanation | | :--- | :--- | :--- | | Gains or losses from disposal of non-current assets (including the write-off of impairment provisions) | -1,566,853.70 | | | Government subsidies recognized in profit or loss for the current period (excluding those closely related to the company's ordinary operations and enjoyed at fixed or quantitative standards set by the state) | 4,055,501.71 | This period received funds for emergency commodity supply key contact enterprises, fiscal support funds, social security and employment subsidies, fresh agricultural product projects for rural commercial circulation system construction, funds for new community convenience stores and superimposed service functions in the commercial circulation industry, incentives for commercial retail enterprises to expand agricultural product sales, incentives for convenience chain enterprises to open new stores, and support for convenience chain enterprises to expand sales | | Fair value changes and investment income from disposal of trading financial assets, trading financial liabilities, and available-for-sale financial assets, excluding effective hedge accounting related to normal business operations | 25,746,438.35 | The company recovered investments from matured short-term bank wealth management products purchased in 2013, obtaining investment income of 25.746 million Yuan | | Other non-operating income and expenses apart from the above items | 107,191.14 | | | Less: Income tax impact | 4,169,218.03 | | | Total | 24,173,059.47 | -- | Board of Directors' Report This section details the company's operational performance, business analysis, core competencies, investment activities, and future outlook Overview of Operations This chapter outlines the macroeconomic environment and market conditions during the reporting period, summarizing the company's operational strategies and achievements - During the reporting period, the national economy maintained stable growth, with Sichuan Province's total retail sales of consumer goods increasing by 13.0% year-on-year, commodity retail sales by 13.5%, and retail sales of grain, oil, food, beverages, tobacco, and alcohol by 19.1% year-on-year[27] - In the first half of the year, the company opened 66 new stores with a total new area of 9,709.38 square meters, bringing the total number of stores to 1,507 by the end of the reporting period[27] - Despite the impact of the macroeconomic environment leading to reduced operating profits from high-margin products like tobacco and alcohol, the company's market share did not decrease, and both operating revenue and net profit achieved growth[28] - The company achieved capital returns through wealth management and continuously enriched its product structure, increased value-added service projects, and strengthened e-commerce platform expansion[28] Main Business Analysis This chapter analyzes the changes in the company's main business financial data, including operating revenue, costs, expenses, and cash flow, explaining the primary reasons for these variations Key Financial Data Year-on-Year Changes | Indicator | Current Reporting Period (Yuan) | Prior Year Same Period (Yuan) | YoY Change | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue | 2,380,081,185.38 | 2,181,658,694.20 | 9.10% | Store expansion, growth in mature stores, and improved internal operational management | | Operating Cost | 1,742,908,395.39 | 1,591,335,530.91 | 9.52% | Increase in operating revenue led to a corresponding increase in operating costs | | Selling Expenses | 485,725,564.59 | 417,821,715.28 | 16.25% | Increased rent for new and renewed stores, and increased advertising and promotional expenses | | Administrative Expenses | 34,048,726.21 | 36,293,625.54 | -6.19% | Changes in personnel structure led to a decrease in administrative expenses | | Financial Expenses | 355,100.25 | -165,308.54 | 314.81% | Decrease in interest from fixed-term bank deposits | | Net Cash Flow from Operating Activities | 122,992,929.61 | 150,366,123.33 | -18.20% | Increase in store rent and promotional expenses within selling expenses during the reporting period | | Net Cash Flow from Investing Activities | 5,842,247.24 | -263,044,510.05 | -102.22% | Recovery of principal and income from previously purchased wealth management products and continued purchase of wealth management products in the current period | | Net Cash Flow from Financing Activities | -20,800,000.00 | -44,051,300.00 | -52.78% | Due to dividend distribution in the prior period | | Net Increase in Cash and Cash Equivalents | 108,035,176.85 | -156,729,686.72 | -168.93% | Increased wealth management income received and reduced dividend distribution compared to the prior period | - During the reporting period, the company opened 66 new stores, upgraded and renovated 96 stores, and actively developed vegetable and fruit bases, private label products, and fast-food services[32] Main Business Composition This chapter analyzes the composition of the company's main business revenue, costs, and gross profit margin across industry, product, and regional dimensions Main Business Composition by Industry | Industry | Operating Revenue (Yuan) | Operating Cost (Yuan) | Gross Profit Margin | | :--- | :--- | :--- | :--- | | Commercial | 2,172,036,053.00 | 1,742,908,395.39 | 19.76% | Main Business Composition by Product | Product | Operating Revenue (Yuan) | Operating Cost (Yuan) | Gross Profit Margin | | :--- | :--- | :--- | :--- | | Daily Necessities | 413,656,295.31 | 328,568,788.18 | 20.57% | | Tobacco and Alcohol | 598,609,599.27 | 476,613,505.93 | 20.38% | | Food | 1,159,770,158.42 | 937,726,101.28 | 19.15% | Main Business Composition by Region | Region | Operating Revenue (Yuan) | Operating Cost (Yuan) | Gross Profit Margin | | :--- | :--- | :--- | :--- | | Chengdu Urban Area | 1,385,340,094.59 | 1,096,720,223.64 | 20.83% | | Suburban Districts | 730,733,393.35 | 600,130,215.66 | 17.87% | | Secondary Urban Areas | 55,962,565.06 | 46,057,956.09 | 17.70% | Core Competitiveness Analysis This chapter elaborates on the company's six core competencies, including its industry benchmark status, differentiated service strategy, internet strategy, efficient supply chain, store replication capability, and unique corporate culture - As the first convenience chain supermarket listed on China's A-share market, the company achieved a 6.19% year-on-year decrease in administrative expenses during the reporting period through internal management improvements[36] - The company adheres to a "products plus services" differentiated competition strategy, having launched nearly 60 value-added services such as utility bill collection, ticket sales, and express parcel collection, effectively enhancing store customer attraction[36] - Actively promoting its internet strategy, the company collaborated with WeChat to build a convenient life application platform, launched "Hongqi Fast Food" ordering and payment functions, and established its own electronic shelves and Hongqi online shopping platform, striving to create a local O2O platform in Sichuan[37] - The company possesses an efficient supply chain and business extension, having built three logistics and distribution centers (Xihe, Cuanqiao, Hongguang) and a cold chain system, enabling centralized warehousing and distribution for most goods, and developing private label products like Hongqi Bread and Hongqi Fast Food, extending into upstream industries[37][38] - The company has an efficient store development and management team, with headquarters providing unified management for all stores, ensuring store opening progress and enhancing brand image[38] - Adhering to the principles of "honest business, convenience for people" and "innovation," the company has formed a synergy for healthy and sustainable development through five major initiatives: "enterprise party building, corporate culture construction, informatization construction, network construction, and logistics and distribution construction"[38][39] Investment Status Analysis This chapter analyzes the company's investment activities, including external equity investments, wealth management, and the use of raised funds, showing that the company primarily generated returns through wealth management and continued to advance its fundraising projects External Equity Investment - During the reporting period, the company had no external investments, did not hold equity in financial enterprises, and had no securities investments[40][41][42] Wealth Management, Derivative Investments, and Entrusted Loans Wealth Management Activities | Trustee Name | Product Type | Entrusted Investment Amount (10,000 Yuan) | Start Date | End Date | Actual Principal Recovered in Current Period (10,000 Yuan) | Actual Profit/Loss in Reporting Period (10,000 Yuan) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Chengdu Rural Commercial Bank Co., Ltd. | Principal-protected floating income | 5,000 | October 28, 2013 | April 28, 2014 | 5,000 | 149.59 | | Chengdu Rural Commercial Bank Co., Ltd. | Principal-protected floating income | 5,000 | November 12, 2013 | May 12, 2014 | 5,000 | 141.33 | | Chengdu Bank Co., Ltd. Changshun Branch | Guaranteed income (principal and income guaranteed) | 50,000 | December 19, 2013 | June 19, 2014 | 50,000 | 1,620.55 | | Chengdu Rural Commercial Bank Co., Ltd. | Principal-protected floating income | 11,000 | December 18, 2013 | June 18, 2014 | 11,000 | 329.1 | | Chengdu Rural Commercial Bank Co., Ltd. | Principal-protected floating income | 10,000 | December 26, 2013 | June 26, 2014 | 10,000 | 334.08 | | Total | | 158,857 | | | 81,000 | 2,574.65 | - During the reporting period, the company had no derivative investments or entrusted loans[46][47] Use of Raised Funds - The total raised funds amounted to 889.066 million Yuan, with 26.6008 million Yuan invested during the reporting period, and a cumulative investment of 283.1309 million Yuan[49] - The supermarket expansion and technical renovation project originally planned to open 918 convenience supermarkets, 8 medium-sized supermarkets, and 2 large supermarkets within three years; as of December 31, 2013, 555 expanded stores were completed, and the project is expected to be completed as planned[50][52] - Over-raised funds of 272.7398 million Yuan have not yet had a specific usage plan formulated[52] - The company used no more than 302 million Yuan of idle raised funds and 290 million Yuan of over-raised funds to purchase short-term principal-protected wealth management products issued by commercial banks, with 574 million Yuan purchased as of June 30, 2014[52] Analysis of Major Subsidiaries and Associates Major Subsidiary Financial Data (Chengdu Hongqi Chain Wholesale Co., Ltd.) | Indicator | Amount (Yuan) | | :--- | :--- | | Registered Capital | 500,000.00 | | Total Assets | 668,935,087.56 | | Net Assets | 42,655,868.43 | | Operating Revenue | 1,239,067,911.67 | | Operating Profit | 48,816,163.09 | | Net Profit | 41,483,304.84 | 2014 January-September Operating Performance Forecast This chapter provides the company's forecast for its operating performance from January to September 2014, expecting positive growth in net profit attributable to shareholders due to increased sales revenue - The estimated change in net profit attributable to shareholders of the listed company for January-September 2014 is a 3.00% to 6.00% increase[59] - The estimated net profit range attributable to shareholders of the listed company for January-September 2014 is 136.7959 million Yuan to 140.7802 million Yuan[59] - The main reason for the performance change is the company's sales revenue growth compared to the same period last year[59] Profit Distribution Implementation and Plan This chapter discloses the implementation of the company's 2013 annual profit distribution plan and announces the profit distribution plan for the current reporting period - The 2013 annual profit distribution plan was implemented on June 9, 2014, distributing a cash dividend of 0.52 Yuan (including tax) per 10 shares to all shareholders, based on a total share capital of 400 million shares[60] - The profit distribution plan for the current reporting period is to distribute a cash dividend of 0.54 Yuan (including tax) per 10 shares and transfer 10 shares from capital reserves per 10 shares[63] - The share capital base for the distribution plan is 400,000,000 shares, with a total cash dividend of 21.6 million Yuan, representing 100.00% of the total profit distribution[63] Survey Reception Status This chapter records the company's reception of institutional and individual surveys, communications, and interviews during the reporting period, primarily focusing on the company's development prospects and operational status - During the reporting period, the company received surveys from institutions and individuals including Ping An Securities, Industrial Securities, Yuanta Polaris Investments, Cathay Investments, and KGI Securities Co., Ltd[64] - The main content of the surveys involved discussions on the company's development prospects and operational status[64] Significant Matters This section covers critical corporate governance aspects, major transactions, related party dealings, and commitments impacting the company Corporate Governance Status This chapter explains that the company strictly complied with relevant laws and regulations during the reporting period, continuously improved its corporate governance structure, standardized operations, and strengthened communication with investors and information disclosure - The company strictly adhered to relevant laws, regulations, and normative documents such as the "Company Law," "Securities Law," and "Shenzhen Stock Exchange Stock Listing Rules," continuously establishing and improving its corporate governance structure and standardizing company operations[66] - The company strengthened communication with investors and fulfilled its information disclosure obligations in accordance with the law, ensuring the truthfulness, timeliness, accuracy, and completeness of information disclosure, and effectively safeguarding the interests of all shareholders[66] Major Litigation, Arbitration, and Media Scrutiny This chapter confirms that the company had no major litigation or arbitration matters, nor was it subject to widespread media scrutiny during the reporting period - The company had no major litigation or arbitration matters during this reporting period[67] - The company had no matters of widespread media scrutiny during this reporting period[68] Asset Transaction Matters This chapter discloses the company's asset acquisition and disposal activities during the reporting period, including the progress of trademark and commercial property acquisitions and the sale of self-owned properties Asset Acquisition Status - The company's acquisition of trademark No. 1672783 from Asset Company is still in progress and has not been completed[70] - The company's acquisition of commercial properties at No. 4, Fuyu Road, Liucheng Town, Wenjiang District (Units 1, 2, 3) from Sichuan Gaodi Auction Co., Ltd. for 16.244 million Yuan is in progress, with title transfer not yet completed[71] Asset Disposal Status - The company sold commercial properties located at 1st Floor, No. 18 Dong'an North Road, Jinjiang District, Chengdu to Li Fei, Liu Jieke, and Zhu Lina on December 2, 2013, for a transaction price of 33.2719 million Yuan[72] Major Related Party Transactions This chapter discloses the company's daily operating transactions with related parties during the reporting period, primarily involving procurement of goods and property leases, confirming no other major related party transactions Related Party Transactions Related to Daily Operations | Related Party | Related Transaction Type | Related Transaction Content | Pricing Principle for Related Transactions | Amount (10,000 Yuan) | | :--- | :--- | :--- | :--- | :--- | | Sun System Printing | Related Procurement | Purchase of plastic bags | Market price | 31.66 | | Cao Shiru | Related Lease | Lease of property | Agreed pricing | 36.77 | | Cao Shixin | Related Lease | Lease of property | Agreed pricing | 11.08 | | Hongqi Assets | Related Lease | Lease of property | Agreed pricing | 218.03 | | Total | | | | 297.54 | - During the reporting period, the company had no related party transactions involving asset acquisition or disposal, no related party transactions involving joint external investments, no related party creditor-debtor relationships, and no other major related party transactions[76][77][78][79] Major Contracts and Their Performance This chapter describes the company's store leasing situation and confirms the absence of trusteeship, contracting, guarantees, or other major contracts or transactions during the reporting period - As of June 30, 2014, the company operated 1,507 stores, of which 101 were self-owned properties, and the remainder were leased properties, with an average area of 206 square meters per store, not constituting a major lease[83] - During the reporting period, the company had no trusteeship, contracting, or guarantee situations, nor any other major contracts or transactions[81][82][84][85][86] Commitments This chapter lists the various commitments made by the company and its shareholders holding 5% or more of the shares, confirming that all commitments are being fulfilled in a timely manner - The company's actual controller Cao Shiru and shareholder Cao Zengjun made long-term commitments regarding share lock-up arrangements, voluntary share lock-up, avoidance of horizontal competition, related party transactions, assumption of social security and provident fund make-up risks, potential fiscal subsidy risks, trademark transfer, potential lease risks, and transfer of related leased properties from Chengdu Hongqi Asset Management (Group) Co., Ltd., all of which are currently being fulfilled[87][88][89] - Chengdu Hongqi Chain Co., Ltd. made a long-term commitment regarding company dividend matters, which is currently being fulfilled[88] Appointment and Dismissal of Accounting Firms This chapter describes the audit of the company's semi-annual financial report, confirming that Lixin Certified Public Accountants (Special General Partnership) issued a standard unqualified audit opinion and no change in accounting firms occurred during the reporting period - The semi-annual financial report was audited by Lixin Certified Public Accountants (Special General Partnership), and the audit opinion type is a standard unqualified audit opinion[108] - The audit fee was 0.3 million Yuan[90] - There was no change in the accounting firm for the semi-annual financial report audit[90] Share Changes and Shareholder Information This section outlines changes in the company's share capital structure and provides details on its major shareholders Share Changes This chapter details the company's total share capital, the composition of restricted and unrestricted shares, and confirms no changes in total share capital during the reporting period - The company's total share capital remained unchanged at 400,000,000 shares during the reporting period[95] - The number of restricted shares is 246,005,550 shares, accounting for 61.50%[95] - The number of unrestricted shares is 153,994,450 shares, accounting for 38.50%[95] Shareholder Numbers and Shareholding Status This chapter lists the shareholding status of shareholders holding 5% or more and the top 10 shareholders, including their shareholding percentage, nature of shares, number of shares held, and restricted share status, also explaining the related party relationships among major shareholders Shareholding Status of Shareholders Holding 5% or More or Top 10 Shareholders | Shareholder Name | Shareholding Percentage | Shareholder Nature | Number of Shares Held at Period-end | Number of Restricted Shares Held | Number of Unrestricted Shares Held | | :--- | :--- | :--- | :--- | :--- | :--- | | Cao Shiru | 55.35% | Domestic Natural Person | 221,400,000 | 221,400,000 | 0 | | Cao Zengjun | 6.15% | Domestic Natural Person | 24,600,000 | 24,600,000 | 0 | | Bank of China - Changsheng Tongzhi Advantage Growth Mixed Securities Investment Fund | 0.63% | Other | 2,538,094 | 0 | 2,538,094 | | National Social Security Fund 105 Portfolio | 0.50% | Other | 1,999,943 | 0 | 1,999,943 | | Wang Jiangtao | 0.44% | Domestic Natural Person | 1,766,181 | 0 | 1,766,181 | | Lü Jianrong | 0.38% | Domestic Natural Person | 1,519,007 | 0 | 1,519,007 | | Gao Yang | 0.25% | Domestic Natural Person | 1,004,000 | 0 | 1,004,000 | | Beijing Haideng Saisi Coating Equipment Center | 0.21% | Domestic Non-state-owned Legal Person | 838,900 | 0 | 838,900 | | Fang Min | 0.20% | Domestic Natural Person | 788,300 | 0 | 788,300 | | Sichuan Trust Co., Ltd. - Hongying No. 16 Securities Investment Collective Fund Trust Plan | 0.19% | Other | 775,600 | 0 | 775,600 | - The company's actual controller, Ms. Cao Shiru, and Mr. Cao Zengjun are mother and son[98] Changes in Controlling Shareholder or Actual Controller This chapter confirms that there were no changes in the company's controlling shareholder or actual controller during the reporting period - The company's controlling shareholder did not change during the reporting period[100] - The company's actual controller did not change during the reporting period[100] Preferred Share Information This chapter confirms the absence of preferred shares and related activities during the reporting period, including issuance, listing, shareholder status, repurchase, conversion, voting rights restoration or exercise, and relevant accounting policies - During the reporting period, the company had no issuance or listing of preferred shares[103] - The company had no preferred share shareholder numbers or shareholding status, preferred share repurchase or conversion, restoration or exercise of preferred share voting rights, or accounting policies and reasons for preferred shares during the reporting period[103] Directors, Supervisors, and Senior Management Information This section details the shareholdings and changes in the composition of the company's board, supervisory board, and senior management Shareholding Changes of Directors, Supervisors, and Senior Management This chapter confirms that there were no changes in the shareholdings of the company's directors, supervisors, and senior management during the reporting period - The shareholdings of the company's directors, supervisors, and senior management did not change during the reporting period[104] Changes in Directors, Supervisors, and Senior Management This chapter discloses the changes in the company's directors, supervisors, and senior management during the reporting period, including the departure of an independent director and a deputy general manager - Independent Director Yu Haizong resigned on April 25, 2014, due to personal reasons[105] - Deputy General Manager Feng Shihua was dismissed on January 17, 2014, due to retirement[105] Financial Report This section comprises the audited financial statements, including balance sheets, income statements, cash flow statements, and notes to the financial statements Audit Report This chapter describes the audit of the company's semi-annual financial report, confirming that Lixin Certified Public Accountants (Special General Partnership) issued a standard unqualified audit opinion - The semi-annual report was audited by Lixin Certified Public Accountants (Special General Partnership), and the audit opinion type is a standard unqualified audit opinion[108] - The audit report was signed on August 12, 2014, by certified public accountants Zhang Yu and Yuan Jingyan[108] Financial Statements This chapter includes the company's 2014 semi-annual consolidated and parent company balance sheets, income statements, cash flow statements, and statements of changes in owners' equity, comprehensively presenting the company's financial position, operating results, and cash flow Consolidated Balance Sheet Consolidated Balance Sheet Key Items | Item | Period-end Balance (Yuan) | Period-beginning Balance (Yuan) | | :--- | :--- | :--- | | Monetary Funds | 540,035,472.34 | 432,000,295.49 | | Accounts Receivable | 7,275,251.55 | 6,060,865.37 | | Inventories | 594,543,527.99 | 644,053,412.42 | | Available-for-sale Financial Assets | 778,570,000.00 | 810,000,000.00 | | Fixed Assets | 700,492,545.50 | 669,773,427.38 | | Total Assets | 2,907,601,287.25 | 2,861,347,501.34 | | Accounts Payable | 785,383,529.04 | 791,024,115.72 | | Total Liabilities | 1,040,537,758.63 | 1,079,711,206.01 | | Total Owners' Equity Attributable to Parent Company | 1,867,063,528.62 | 1,781,636,295.33 | Parent Company Balance Sheet Parent Company Balance Sheet Key Items | Item | Period-end Balance (Yuan) | Period-beginning Balance (Yuan) | | :--- | :--- | :--- | | Monetary Funds | 468,120,915.98 | 327,717,749.86 | | Accounts Receivable | 22,229,715.43 | 13,367,345.22 | | Inventories | 322,152,629.65 | 342,424,555.55 | | Available-for-sale Financial Assets | 778,570,000.00 | 810,000,000.00 | | Fixed Assets | 646,269,732.20 | 616,554,799.03 | | Total Assets | 2,740,164,166.15 | 2,693,410,626.22 | | Accounts Payable | 196,127,849.08 | 202,743,209.68 | | Total Liabilities | 879,135,021.00 | 918,754,516.23 | | Total Owners' Equity | 1,861,029,145.15 | 1,774,656,109.99 | Consolidated Income Statement Consolidated Income Statement Key Items | Item | Current Period Amount (Yuan) | Prior Period Amount (Yuan) | | :--- | :--- | :--- | | Total Operating Revenue | 2,380,081,185.38 | 2,181,658,694.20 | | Total Operating Costs | 2,282,944,174.53 | 2,061,870,521.54 | | Operating Profit | 122,883,449.20 | 120,733,378.14 | | Total Profit | 125,479,288.35 | 121,335,001.65 | | Net Profit | 106,227,233.29 | 103,086,596.10 | | Basic Earnings Per Share | 0.27 | 0.26 | Parent Company Income Statement Parent Company Income Statement Key Items | Item | Current Period Amount (Yuan) | Prior Period Amount (Yuan) | | :--- | :--- | :--- | | Operating Revenue | 1,232,800,493.71 | 1,128,099,872.91 | | Operating Profit | 113,447,313.40 | 107,402,938.82 | | Net Profit | 107,173,035.16 | 102,668,330.35 | Consolidated Cash Flow Statement Consolidated Cash Flow Statement Key Items | Item | Current Period Amount (Yuan) | Prior Period Amount (Yuan) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 122,992,929.61 | 150,366,123.33 | | Net Cash Flow from Investing Activities | 5,842,247.24 | -263,044,510.05 | | Net Cash Flow from Financing Activities | -20,800,000.00 | -44,051,300.00 | | Net Increase in Cash and Cash Equivalents | 108,035,176.85 | -156,729,686.72 | | Period-end Cash and Cash Equivalents Balance | 537,035,472.34 | 1,022,562,531.36 | Parent Company Cash Flow Statement Parent Company Cash Flow Statement Key Items | Item | Current Period Amount (Yuan) | Prior Period Amount (Yuan) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 89,600,591.20 | 179,475,390.44 | | Net Cash Flow from Investing Activities | 71,602,574.92 | -243,825,443.99 | | Net Cash Flow from Financing Activities | -20,800,000.00 | -44,051,300.00 | | Net Increase in Cash and Cash Equivalents | 140,403,166.12 | -108,401,353.55 | | Period-end Cash and Cash Equivalents Balance | 465,120,915.98 | 963,811,283.05 | Consolidated Statement of Changes in Owners' Equity Consolidated Statement of Changes in Owners' Equity Key Items | Item | Period-beginning Balance (Yuan) | Current Period Change Amount (Yuan) | Period-end Balance (Yuan) | | :--- | :--- | :--- | :--- | | Paid-in Capital (or Share Capital) | 400,000,000.00 | 0 | 400,000,000.00 | | Capital Reserve | 844,028,452.36 | 0 | 844,028,452.36 | | Surplus Reserve | 63,337,947.41 | 10,717,303.52 | 74,055,250.93 | | Undistributed Profit | 474,269,895.56 | 74,709,929.77 | 548,979,825.33 | | Total Owners' Equity Attributable to Parent Company | 1,781,636,295.33 | 85,427,233.29 | 1,867,063,528.62 | Parent Company Statement of Changes in Owners' Equity Parent Company Statement of Changes in Owners' Equity Key Items | Item | Period-beginning Balance (Yuan) | Current Period Change Amount (Yuan) | Period-end Balance (Yuan) | | :--- | :--- | :--- | :--- | | Paid-in Capital (or Share Capital) | 400,000,000.00 | 0 | 400,000,000.00 | | Capital Reserve | 844,776,635.95 | 0 | 844,776,635.95 | | Surplus Reserve | 63,087,947.41 | 10,717,303.52 | 73,805,250.93 | | Undistributed Profit | 466,791,526.63 | 75,655,731.64 | 542,447,258.27 | | Total Owners' Equity | 1,774,656,109.99 | 86,373,035.16 | 1,861,029,145.15 | Company Basic Information This chapter details the company's registration information, business scope, and organizational structure, including its name, registered capital, legal representative, main business, and wholly-owned subsidiaries - Company name: Chengdu Hongqi Chain Co., Ltd., business license registration number: 510100000053347, establishment date: June 22, 2000, registered capital: 400 million Yuan, legal representative: Cao Shiru[137][138] - The business scope covers wholesale and retail, property leasing, warehousing and distribution, household services, photography and developing, import and export business, medical device sales, internet sales, tobacco and alcohol retail, telecom bill payment agency, wholesale and retail of pre-packaged food and dairy products, pastry production, and information services[139] - The company owns eleven wholly-owned subsidiaries, including Chengdu Hongqi Chain Wholesale Co., Ltd. and Chengdu Wuhou District Hongqi Chain Co., Ltd[140] Key Accounting Policies, Accounting Estimates, and Prior Period Errors This chapter elaborates on the company's financial statement preparation basis, accounting standards, accounting period, functional currency, and key accounting policies and estimates, also disclosing changes in accounting estimates and corrections of prior period errors Changes in Accounting Policies - The company's main accounting policies did not change during this reporting period[214] Changes in Accounting Estimates - The company changed the depreciation period for buildings and structures from 20 years to 20-40 years, increasing total profit by 6.253 million Yuan[213][216] - The company changed the estimated useful life for secondary (or more) renovation and improvement expenditures for newly opened other types of venues and existing stores from 2 years to 3 years, increasing total profit by 4.673 million Yuan[213][216] Correction of Prior Period Accounting Errors - In its 2013 annual financial statements, the company reported year-end prepaid rent as prepaid accounts, which did not meet the definition of current assets, and has since made retrospective adjustments[217][218] Impact of Prior Period Accounting Error Correction on 2013 Consolidated Financial Statements | Statement Item | Amount Before Adjustment (Yuan) | Correction Amount (Yuan) | Amount After Adjustment (Yuan) | | :--- | :--- | :--- | :--- | | Prepaid Accounts | 232,496,380.72 | -79,904,536.86 | 152,591,843.86 | | Other Non-current Assets | 0 | 79,904,536.86 | 79,904,536.86 | Taxes This chapter lists the company's main tax categories and rates, and explains the enterprise income tax preferential policies enjoyed by the company and its eligible subsidiaries under the Western Development Strategy Company's Main Tax Categories and Rates | Tax Category | Tax Basis | Tax Rate | | :--- | :--- | :--- | | Value-Added Tax | Calculated based on sales of goods and taxable services as stipulated by tax laws, with output tax minus deductible input tax as VAT payable | 0%, 6%, 13%, 17% | | Business Tax | Levied on taxable operating revenue | 5% | | Urban Maintenance and Construction Tax | Levied on actual business tax, value-added tax, and consumption tax paid | 5%, 7% | | Enterprise Income Tax | Taxable income | 15%, 25% | - The company and its eligible wholly-owned subsidiaries provisionally accrue enterprise income tax at a 15% rate for January-June 2014, based on documents such as the "Notice on Tax Policies Related to Deepening the Implementation of the Western Development Strategy" (Cai Shui [2011] No. 58)[222][223] Business Combinations and Consolidated Financial Statements This chapter details the basic information of the company's subsidiaries, confirming that all subsidiaries are included in the consolidated financial statements and that the scope of consolidation did not change during the reporting period - The company owns 11 wholly-owned subsidiaries, including Chengdu Hongqi Chain Wholesale Co., Ltd., with 100% shareholding and voting rights, all included in the consolidated financial statements[225][226][227] - The scope of consolidation did not change during the reporting period[232] Notes to Major Items in Consolidated Financial Statements This chapter provides detailed notes on major asset, liability, owners' equity, revenue, cost, expense, and cash flow items in the consolidated financial statements, explaining their composition, changes, and related accounting treatments - The period-end balance of monetary funds is 540.035 million Yuan, of which 3 million Yuan is restricted cash[239] - The period-end balance of available-for-sale financial assets is 778.57 million Yuan, primarily consisting of bank wealth management products purchased by the company[300] - The period-end balance of long-term deferred expenses is 31.091 million Yuan, mainly for renovation and improvement expenditures for leased stores[349] - The period-end balance of deferred income tax assets is 0.567 million Yuan, primarily arising from bad debt provisions and accrued but unredeemed loyalty card points[350] - The period-end balance of employee compensation payable is 10.855 million Yuan, a 36.33% decrease from the beginning of the period, mainly due to the distribution of employee year-end bonuses accrued in 2013[368][549] - Operating revenue for the current period was 2.380 billion Yuan, and operating cost was 1.742 billion Yuan[403] - Investment income for the current period was 25.746 million Yuan, mainly from investment income obtained during the holding period of available-for-sale financial assets[422] - Non-operating income for the current period was 4.184 million Yuan, primarily government subsidies[430] - Non-operating expenses for the current period were 1.588 million Yuan, mainly losses from disposal of non-current assets[433][434] - Basic earnings per share was 0.27 Yuan[437] Related Parties and Related Party Transactions This chapter details the company's related party relationships and transactions with related parties during the reporting period, including procurement, leasing, and accounts receivable/payable, ensuring transparency of related party transactions - The company's actual controller Cao Shiru, her brother Cao Shizhong, nephew Cao Daijun, and shareholder Cao Zengjun (holding 5% or more) are all related parties[458] - Major related party transactions include purchasing plastic bags from Chengdu Sun System Printing Co., Ltd. for 0.316 million Yuan, and leasing commercial properties from Cao Shiru, Cao Shixin, and Hongqi Assets, with total lease expenses recognized in this reporting period amounting to 2.579 million Yuan[460][466][467] - The company's accounts receivable from related parties primarily consist of prepayments, totaling 2.475 million Yuan from Cao Shiru, Hongqi Assets, and Cao Shixin at period-end[475] - The company's accounts payable to related parties primarily consist of accounts payable, totaling 0.212 million Yuan to Chengdu Sun System Printing Co., Ltd. at period-end[476] Post-Balance Sheet Events This chapter discloses the profit distribution events that occurred after the balance sheet date, specifically the company's proposed cash dividend and capital reserve to share capital transfer plan - Post-balance sheet profit distribution: A plan to distribute a cash dividend of 0.54 Yuan (including tax) per 10 shares to all shareholders, with no bonus shares, and to transfer 10 shares from capital reserves per 10 shares, based on 400,000,000 shares[63][481][482] Supplementary Information This chapter provides supplementary information, including details of non-recurring gains and losses, return on net assets, and earnings per share, along with explanations for abnormal changes in major financial statement items Current Period Non-recurring Gains and Losses Details Current Period Non-recurring Gains and Losses Details | Item | Amount (Yuan) | | :--- | :--- | | Gains or losses from disposal of non-current assets (including the write-off of impairment provisions) | -1,566,853.70 | | Government subsidies recognized in profit or loss for the current period (excluding those closely related to the company's ordinary operations and enjoyed at fixed or quantitative standards set by the state) | 4,055,501.71 | | Fair value changes and investment income from disposal of trading financial assets, trading financial liabilities, and available-for-sale financial assets, excluding effective hedge accounting related to normal business operations | 25,746,438.35 | | Other non-operating income and expenses apart from the above items | 107,191.14 | | Less: Income tax impact | 4,169,218.03 | | Total | 24,173,059.47 | Return on Net Assets and Earnings Per Share Return on Net Assets and Earnings Per Share | Profit for the Reporting Period | Weighted Average Return on Net Assets | Basic Earnings Per Share | Diluted Earnings Per Share | | :--- | :--- | :--- | :--- | | Net profit attributable to ordinary shareholders of the company | 5.82% | 0.27 | 0.27 | | Net profit attributable to ordinary shareholders of the company after deducting non-recurring gains and losses | 4.50% | 0.21 | 0.21 | Explanation of Abnormal Changes in Major Financial Statement Items - Other receivables increased by 90.31% compared to the end of the previous year, mainly due to an increase in mobile points redemption amounts in the current period[549] - Deferred income tax assets increased by 200.31% compared to the end of the previous year, mainly due to an increase in sales points awards in the current period[549] - Employee compensation payable decreased by 36.33% compared to the end of the previous year, mainly because employee year-end bonuses accrued in 2013 were distributed in the current period[549] - Financial expenses increased by 314.81% compared to the end of the previous year, mainly due to a decrease in interest from fixed-term bank deposits[550] - Investment income increased by 262.39% compared to the end of the previous year, mainly due to increased purchases of wealth management products and higher investment income received[550] - Non-operating expenses decreased by 58.30% compared to the end of the previous year, mainly due to more donations in the previous period[550] - Net cash flow from investing activities increased by 102.22% compared to the end of the previous year, mainly due to continued purchases of wealth management products in the current period[550] - Net cash flow from financing activities decreased by 52.78% compared to the end of the previous year, mainly due to higher dividend distribution in the previous period[550] - Net increase in cash and cash equivalents increased by 168.93% compared to the end of the previous year, mainly due to increased wealth management income received and reduced dividend distribution compared to the previous period[550] Catalogue of Documents for Reference This chapter lists all supporting documents available for review, ensuring transparency and accessibility of information - Documents for reference include the resolutions of the 17th meeting of the Second Board of Directors, the 12th meeting of the Second Supervisory Board, the audit report stamped by Lixin Certified Public Accountants (Special General Partnership) and signed by certified public accountants, financial statements signed and stamped by the company's legal representative, the person in charge of accounting work, and the head of the accounting department (accounting supervisor), and the originals of all company documents and announcements publicly disclosed on the information disclosure platform designated by the China Securities Regulatory Commission during the reporting period[553]