王府井(600859) - 2021 Q4 - 年度财报

Important Notes This section confirms the report's authenticity and outlines the 2021 profit distribution plan - The Board of Directors, Board of Supervisors, and all directors, supervisors, and senior management guarantee the truthfulness, accuracy, and completeness of this annual report[2] - ShineWing Certified Public Accountants (Special General Partnership) issued a standard unqualified audit opinion for the company[3] 2021 Annual Profit Distribution Plan | Distribution Plan | Details | | :--- | :--- | | Cash Dividend | A cash dividend of RMB 4 (tax inclusive) will be distributed for every 10 shares held | | Total Dividend Amount | Based on the total share capital of 1,132,841,451 shares as of December 31, 2021, the total proposed cash dividend is RMB 453,136,580.40 (tax inclusive) | | Dividend Payout Ratio | The cash dividend payout ratio for the year is 33.81% | | Capital Reserve Capitalization | No capitalization of capital reserves into share capital will be conducted this year | Definitions This section provides definitions for key terms and abbreviations used throughout the report Company Profile and Key Financial Indicators This section presents the company's basic information and key financial performance indicators for the past three years Company Information This chapter provides the basic corporate information, contact details, and information disclosure channels for Wangfujing Group Co, Ltd Company Basic Information | Item | Content | | :--- | :--- | | Chinese Name | 王府井集团股份有限公司 | | Stock Ticker | Wangfujing | | Stock Code | 600859 | | Listing Exchange | Shanghai Stock Exchange | | Legal Representative | Du Baoxiang | Key Accounting Data and Financial Indicators for the Last Three Years The company's performance grew significantly in 2021, with revenue up 10.55% and net profit attributable to parent up 295.61% 2021 Key Accounting Data (Restated) | Indicator | 2021 (RMB) | 2020 (RMB) | YoY Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 12,753,081,424.86 | 11,535,553,782.42 | 10.55 | | Net Profit Attributable to Parent | 1,340,242,115.52 | 338,778,553.18 | 295.61 | | Non-recurring Net Profit Attributable to Parent | 942,585,380.43 | 407,549,361.38 | 131.28 | | Net Cash Flow from Operating Activities | 2,772,010,556.15 | 707,893,702.71 | 291.59 | | Total Assets | 39,150,581,109.27 | 28,597,807,986.37 | 36.90 | | Net Assets Attributable to Parent | 19,347,010,440.78 | 15,619,138,591.57 | 23.87 | 2021 Key Financial Indicators (Restated) | Indicator | 2021 | 2020 | Change | | :--- | :--- | :--- | :--- | | Basic Earnings Per Share (RMB/Share) | 1.364 | 0.347 | 293.08% | | Weighted Average Return on Equity (%) | 8.858 | 2.161 | Increased by 6.697 percentage points | - Prior period comparative data in the consolidated financial statements were restated due to the completion of business combinations under common control, including the share-swap merger with Beijing Shoushang Group Co, Ltd and the acquisition of Shaanxi Saite Guomao Department Store[18] Quarterly Financial Data The company's quarterly data for 2021 shows the highest net profit attributable to parent in the fourth quarter, reaching RMB 579 million 2021 Key Quarterly Financial Data (Unit: RMB) | Indicator | Q1 | Q2 | Q3 | Q4 | | :--- | :--- | :--- | :--- | :--- | | Operating Revenue | 3,455,277,792.89 | 3,119,776,017.40 | 3,006,841,246.77 | 3,171,186,367.80 | | Net Profit Attributable to Parent | 315,491,696.51 | 251,121,752.68 | 194,452,144.88 | 579,176,521.45 | | Non-recurring Net Profit Attributable to Parent | 235,668,823.86 | 222,977,571.79 | 102,754,955.24 | 381,184,029.54 | | Net Cash Flow from Operating Activities | 381,498,869.93 | 681,860,509.07 | 926,340,586.15 | 782,310,591.00 | Non-recurring Gains and Losses The company's non-recurring gains and losses totaled RMB 398 million in 2021, primarily from the net profit of subsidiaries in business combinations under common control 2021 Key Non-recurring Items (Unit: RMB) | Item | 2021 Amount | | :--- | :--- | | Net profit of subsidiaries from the beginning of the period to the merger date in business combinations under common control | 579,214,032.88 | | Gains and losses from contingent events unrelated to the company's normal business operations | -53,061,258.54 | | Other non-operating income and expenses besides the above items | 35,687,946.50 | | Gains from changes in fair value and disposal of financial instruments | 27,206,735.57 | | Total | 397,656,735.09 | Management Discussion and Analysis This section provides management's analysis of the company's operating results, industry landscape, and future outlook Discussion and Analysis of Operations In 2021, the company achieved strong operating results through innovative management and cost reduction despite the pandemic and restructuring pressures - The company boosted sales and efficiency by creating unique marketing IPs, opening 4 new stores, and introducing over 2,150 new brands and 560 regional first stores[24] - The company continued to promote its self-operated businesses, with progress in projects like Regalo (buyer's select shop), Faya (sports brands), and Beijing Youli (time-honored brands collection)[25] - The duty-free business advanced with companies established in Beijing and Hainan and a team of over 180 people, but no specific projects were operational by the end of the reporting period[25] Industry Overview China's retail industry recovered steadily in 2021, showing trends of supply chain digitalization and channel diversification - The retail industry showed a divergent trend: outlets and shopping centers recovered rapidly, while department stores recovered slowly and supermarkets were significantly impacted by online competition[27] - National policies promoting the duty-free industry, combined with changing consumption patterns, created significant growth potential for the duty-free market[27] Company Business Overview The company's main business comprises merchandise sales and rental income, operating 74 large retail stores across 35 cities in China Overview of Main Business Segments | Format | Number of Stores | Operating Model | Revenue Source | | :--- | :--- | :--- | :--- | | Department Store | 38 | Mainly concessionaire | Merchandise retail sales | | Outlet | 14 | Mainly concessionaire | Merchandise retail sales | | Shopping Center | 22 | Mainly leasing | Rental income | | Supermarket | 15 (JV) | Mainly direct sales | Merchandise retail sales | | Specialty Store | 441 (incl. franchise) | Agency/Franchise | Merchandise retail sales | | Online Business | - | Multiple models | Online sales (over RMB 1 billion annually) | | Duty-Free Business | 0 (in preparation) | Licensed operation | - | Core Competitiveness Analysis Wangfujing's core competitiveness lies in its status as one of China's largest retail groups with a comprehensive portfolio and a 67-year history - The company is one of the largest and most diversified retail groups in China, owning well-known brands like Wangfujing Department Store, Shopping Center, Outlet, Scitech Outlet, and Yansha[30] - It has a vast membership system with over 18 million members, forming a solid performance base[30] - The merger with Shoushang Group expanded market share, and obtaining the duty-free license will create a "taxed + duty-free" dual-driven model[31] Principal Business Activities In 2021, the company achieved operating revenue of RMB 12.75 billion, a year-on-year increase of 10.55% Analysis of Main Business Operations In 2021, operating revenue increased by 10.55% while operating costs decreased by 2.95% year-on-year Key Items from Income Statement and Cash Flow Statement | Item | Current Period (RMB) | Prior Year Period (RMB) | Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 12,753,081,424.86 | 11,535,553,782.42 | 10.55 | | Operating Costs | 7,378,722,863.39 | 7,603,285,005.18 | -2.95 | | Financial Expenses | 362,561,935.53 | 377,766.15 | 95,875.23 | | Net Cash Flow from Operating Activities | 2,772,010,556.15 | 707,893,702.71 | 291.59 | | Net Cash Flow from Investing Activities | 962,733,509.07 | 361,931,354.00 | 166.00 | | Net Cash Flow from Financing Activities | 863,768,280.55 | -2,537,665,205.59 | N/A | Main Business Performance by Format (RMB) | Format | Operating Revenue | Operating Costs | Gross Margin (%) | Revenue YoY Change (%) | | :--- | :--- | :--- | :--- | :--- | | Department Store | 7,109,462,753.87 | 4,469,349,698.51 | 37.14 | 9.91 | | Shopping Center | 2,061,167,327.11 | 1,020,425,877.78 | 50.49 | 19.79 | | Outlet | 1,606,931,040.82 | 486,824,177.86 | 69.70 | 30.53 | | Supermarket | 492,731,160.56 | 421,494,771.63 | 14.46 | 13.97 | | Specialty Store | 1,791,103,023.92 | 1,513,592,439.69 | 15.49 | -3.45 | - Financial expenses increased significantly by 95,875.23% year-on-year, primarily due to lease financing costs arising from the adoption of the new lease standard[46] Analysis of Assets and Liabilities As of year-end 2021, total assets reached RMB 39.15 billion, an increase of 36.9% from the beginning of the year Key Items from Balance Sheet | Item | Ending Balance (RMB) | Beginning Balance (RMB) | Change (%) | Main Reason | | :--- | :--- | :--- | :--- | :--- | | Cash and Cash Equivalents | 14,302,816,451.19 | 9,685,646,323.51 | 47.67 | Raised supporting funds from merger and redeemed wealth management products | | Trading Financial Assets | 0.00 | 1,739,439,326.05 | -100.00 | Redeemed bank structured deposits and wealth management products | | Right-of-use Assets | 6,751,220,530.85 | 0.00 | 100.00 | Adoption of new lease standard | | Lease Liabilities | 7,308,549,546.04 | 0.00 | 100.00 | Adoption of new lease standard | | Capital Reserve | 10,088,745,543.86 | 6,512,322,143.31 | 54.92 | Raised supporting funds from merger | - As of the end of the reporting period, the company had RMB 1.676 billion in restricted assets, mainly comprising funds for single-purpose prepaid cards and investment properties pledged for loans[53] Analysis of Industry-Specific Operational Information As of year-end 2021, the company operated 74 stores with a total gross floor area of 4.34 million square meters Store Distribution by Region | Region | Number of Stores | Total GFA (million sqm) | | :--- | :--- | :--- | | North China | 24 | 1.15 | | Southwest China | 20 | 0.98 | | Northwest China | 14 | 0.87 | | Central China | 10 | 0.63 | | Northeast China | 3 | 0.38 | | East China | 2 | 0.15 | | South China | 1 | 0.19 | | Total | 74 | 4.34 | - In 2021, 4 new stores were opened: Chengdu Wangfujing Discovery Shopping Center, Meishan Wangfujing Shopping Center, Wangfujing Outlet Pingyuan Town, and Wangfujing Outlet Ruyi Town[62] - The company added 11 stores in North, Northwest, and Southwest China through the merger with Shoushang Group[62] Analysis of Investment Status During the reporting period, the company's total external equity investment amounted to RMB 599 million - External equity investments of RMB 599 million were primarily used to establish duty-free, outlet, and shopping center project companies in locations such as Hainan and Beijing[63][65] - The company completed the share-swap merger with Shoushang Group and raised supporting funds, increasing total share capital to 1,132,841,451 shares; integration efforts have effectively enhanced market share[70] Discussion and Analysis of Future Development Looking ahead to 2022, the company anticipates continued recovery in the domestic consumer market but faces multiple risks Company Development Strategy The company will accelerate and enhance its "5+2" retail ecosystem, focusing on developing shopping centers and outlets while advancing its duty-free business - The core strategy is to perfect the "5+2" retail ecosystem, accelerating the development of shopping centers and outlets, and fully promoting the duty-free business[81] 2022 Business Plan In 2022, the company plans to secure its annual profit targets and accelerate the transformation of its traditional department store format - New store preparations: Taiyuan Outlet and Suzhou Shopping Center are expected to officially open in 2022[83] - Existing project transformation: The company will focus on upgrading the Xidan project and the Golden Street Shopping Center project[83] Potential Risks The company faces four main risks: operational risks from macroeconomic uncertainty, intense industry competition, management risks from expansion, and risks of underperformance in new business ventures - The company faces four major risks: macroeconomic, industry competition, management and operational, and new business implementation[84] - It is specifically noted that the duty-free business faces the risk of underperformance as projects have not yet been launched due to the recurring pandemic and stalled international travel recovery[85] Corporate Governance This section details the company's corporate governance structure, practices, and information on its board and management Overview of Corporate Governance During the reporting period, the company strictly complied with relevant laws and regulations, continuously improving its corporate governance structure and internal control system - The company's governance structure is sound, with clear responsibilities for its authority, decision-making, and supervisory bodies, operating in compliance with regulatory requirements[87] - During the reporting period, the Board of Directors consisted of 13 directors (including 5 independent directors) and held 13 meetings; the Board of Supervisors consisted of 3 supervisors and held 10 meetings[88] Directors, Supervisors, and Senior Management This chapter discloses details on the shareholdings, remuneration, and work experience of current and former directors, supervisors, and senior management Pre-tax Remuneration of Selected Executives in 2021 (RMB 10,000) | Name | Position | Total Remuneration | | :--- | :--- | :--- | | Du Baoxiang | Chairman | 100.44 | | Shang Xiping | Director, President | 100.44 | | Zhang Jianguo | Executive Vice President | 90.40 | | Du Jianguo | Director, Vice President | 85.37 | - During the reporting period, the company appointed Wang Jian, Ren Jiangping, and Zhu Jie as Vice Presidents and Wu Jun as CFO to meet operational needs following the merger with Shoushang Group[102][107] Environmental and Social Responsibility This section outlines the company's initiatives and performance related to environmental protection and social responsibility Environmental Information As a retail enterprise, the company is not classified as a key pollutant-discharging unit by environmental authorities - The company is not a key pollutant-discharging unit and achieved a CO2 emission reduction of approximately 4,322 tons during the reporting period through energy-saving measures[135] Social Responsibility Work The company actively fulfills its social responsibilities in areas such as business integrity, consumer protection, and employee welfare - The company adheres to business integrity and has received an AAA credit rating from third-party rating agencies[137] - During the reporting period, the company and its subsidiaries paid a total of RMB 1.438 billion in various taxes and fees[137] Significant Matters This section discloses significant corporate events during the reporting period, including commitments and major related-party transactions Fulfillment of Commitments During the reporting period, the company and relevant parties strictly fulfilled all commitments - The commitment by the controlling shareholder, BTG, to resolve horizontal competition with Shoushang Group was fulfilled through the completion of the share-swap merger in 2021[90][141] Significant Related-Party Transactions The company engaged in several significant related-party transactions during the reporting period - Routine related-party transactions mainly involved financial services (deposits, loans) with the finance company of the controlling shareholder, BTG, as well as property leasing[160][161][171] - To facilitate the restructuring, the former Shoushang Group transferred equity in Beijing Yixing Commercial Investment and Beijing Wanfang Xidan Shopping Center to related parties[72][163] - The company's completion of the share-swap merger with Shoushang Group and the associated fundraising constituted a major related-party transaction[174] Changes in Share Capital and Shareholders This section details changes in the company's share capital and provides an overview of its shareholder structure Changes in Share Capital The company's total share capital underwent significant changes during the reporting period Share Capital Changes (Unit: Shares) | Item | Before Change | Change | After Change | | :--- | :--- | :--- | :--- | | Restricted Shares | 0 | +155,353,430 | 155,353,430 | | Unrestricted Shares | 776,250,350 | +201,237,671 | 977,488,021 | | Total Shares | 776,250,350 | +356,591,101 | 1,132,841,451 | - The increase in share capital was mainly due to two parts: the issuance of approximately 201 million new shares for the share-swap merger with Shoushang Group and a private placement of approximately 155 million shares to raise supporting funds[183] Shareholders and Ultimate Controller As of the end of 2021, the company had a total of 97,467 common shareholders Top Five Shareholders as of the Reporting Period End | Shareholder Name | Number of Shares | Percentage (%) | Share Status | | :--- | :--- | :--- | :--- | | Beijing Tourism Group Co, Ltd | 372,776,396 | 32.91 | Partially restricted | | Sanpower Group Nanjing Investment Management Co, Ltd | 87,325,918 | 7.71 | Pledged 87,325,918 shares | | Beijing Jingguorui State-owned Enterprise Reform and Development Fund (Limited Partnership) | 50,454,800 | 4.45 | - | | Chengdu Industrial Capital Holding Group Co, Ltd | 38,449,875 | 3.39 | - | | Beijing State-owned Capital Operation and Management Co, Ltd | 36,668,575 | 3.24 | Restricted | - The company's controlling shareholder is BTG, and the ultimate controller is the Beijing Municipal SASAC, with no changes during the reporting period[189][198] Bond-related Matters This section provides information on the company's outstanding bonds, including credit ratings and repayment status Bond Overview During the reporting period, the company had one outstanding medium-term note, "19 Wangfujing Group MTN001" Outstanding Medium-Term Note Details | Bond Ticker | Code | Issue Date | Maturity Date | Bond Balance (RMB billion) | Coupon Rate (%) | | :--- | :--- | :--- | :--- | :--- | :--- | | 19 Wangfujing Group MTN001 | 101901016 | 2019-8-2 | 2022-8-2 | 2.00 | 3.66% | - The company's first medium-term note of 2018, amounting to RMB 500 million, was fully repaid with principal and interest on August 20, 2021[201] - Shanghai Brilliance Credit Rating & Investors Service Co, Ltd assigned an AAA rating to both the company and its outstanding bonds, with a stable outlook[206] Financial Report This section presents the audited financial statements for the fiscal year, including the auditor's report and key accounting policies Auditor's Report ShineWing Certified Public Accountants issued a standard unqualified audit opinion on the company's 2021 financial statements - Audit Firm: ShineWing Certified Public Accountants (Special General Partnership)[217] - Audit Opinion: Standard unqualified opinion[209] - Key Audit Matters: - Revenue Recognition: Due to its nature as a key performance indicator, there is an inherent risk of improper recognition by management - Goodwill Impairment: Due to the significant amount of goodwill (RMB 858 million) and the significant judgments and assumptions involved in impairment testing - First-time Adoption of the New Lease Standard: Due to its significant impact on multiple items in the financial statements[212][213] Financial Statements This section contains the consolidated and parent company balance sheets, income statements, cash flow statements, and statements of changes in equity for 2021 Consolidated Balance Sheet Summary (December 31, 2021) | Item | Amount (RMB) | | :--- | :--- | | Total Assets | 39,150,581,109.27 | | Total Liabilities | 19,047,732,498.33 | | Equity Attributable to Parent Company Owners | 19,347,010,440.78 | Consolidated Income Statement Summary (2021) | Item | Amount (RMB) | | :--- | :--- | | Total Operating Revenue | 12,753,081,424.86 | | Operating Profit | 1,905,834,860.74 | | Total Profit | 1,906,307,439.56 | | Net Profit | 1,378,280,898.73 | | Net Profit Attributable to Parent Company Shareholders | 1,340,242,115.52 | Significant Accounting Policies and Estimates This chapter details the significant accounting policies and estimates followed in preparing the financial statements, with the most important change being the adoption of the new lease standard - The company adopted the new lease standard starting January 1, 2021, and retrospectively adjusted the opening balances of retained earnings and related financial statement items[153][316] Impact of First-time Adoption of New Lease Standard on Opening Financial Statements (Adjustment Amount, RMB) | Item | Adjustment Amount | | :--- | :--- | | Right-of-use Assets | +7,613,976,793.91 | | Lease Liabilities | +8,211,770,887.70 | | Non-current Liabilities Due within One Year | +895,793,013.16 | | Prepayments | -225,522,934.81 | | Retained Earnings | -1,220,843,255.60 | Notes to Consolidated Financial Statements This chapter provides detailed notes and explanations for key items in the consolidated financial statements - Cash and cash equivalents at year-end were RMB 14.30 billion, a significant increase from the beginning of the year, mainly due to fundraising from the merger with Shoushang Group and the redemption of structured deposits[335] - Upon the first-time adoption of the new lease standard, the company recognized right-of-use assets with a carrying amount of RMB 6.75 billion and lease liabilities with a carrying amount of RMB 7.31 billion at year-end[389][433] - The carrying amount of goodwill was RMB 893 million, primarily from the acquisition of the Springland Department Store asset group; an impairment provision of RMB 35.03 million was made against Regalo International Trading (Shanghai) Co, Ltd[393][394]