COFCO CAPITAL(SZ:002423)2023-08-29 16:00Share Capital and Registered Capital - The company's total issued shares as of June 30, 2023, amounted to 2,304,105,575 shares[15] - The company's registered capital is RMB 2,304,105,575.00, with the main office located in Beijing[58] Revenue Recognition and Income Sources - The company's revenue recognition includes insurance business income, commission income, investment contract management fee income, asset management fee income, and interest income[8] - The company's related-party insurance business generated premium income of 10,345.38 million RMB[67] - The company's related-party insurance business resulted in insurance claims of 1,485.18 million RMB[67] - The company's related-party futures business generated sales and procurement revenue of 44,845.62 million RMB[67] - The company's related-party futures business generated fee income of 1,339.53 million RMB[67] - The company's total operating revenue for the first half of 2023 was RMB 11.75 billion, a significant increase from RMB 9.04 billion in the same period last year[129] Lease Accounting - For short-term leases and low-value asset leases, the company does not recognize right-of-use assets and lease liabilities, instead recognizing lease payments on a straight-line basis over the lease term[2] Tax and Deferred Tax Assets - The company's deferred tax assets are recognized based on the likelihood of future taxable income to offset deductible temporary differences, deductible losses, and tax credits[12] - The company's subsidiaries have varying income tax rates, ranging from 15% to 25%[47] - The company revises deferred tax recognition exemptions under the "Accounting Standards for Business Enterprises No. 18 - Income Taxes," clarifying the scope of initial recognition exemptions[169] Financial Assets and Liabilities - The company's financial assets and liabilities are initially measured at fair value, with transaction costs either expensed or capitalized depending on the classification[17] - The company classifies financial assets based on their business model and cash flow characteristics, with debt instruments categorized into three measurement categories: amortized cost, fair value through other comprehensive income, and fair value through profit or loss[182][183] - The company determines the fair value of financial instruments using recent market prices or valuation methods when market prices are unavailable, minimizing the use of company-specific parameters[166] - The company applies hedge accounting for fair value hedges, ensuring that the hedging relationship meets specific criteria, including economic relationship and hedge effectiveness[170] - The company measures loss provisions for financial instruments based on expected credit losses, with Stage 1 requiring a 12-month expected credit loss and Stage 3 requiring a lifetime expected credit loss for impaired financial instruments[187] - Debt instruments classified as fair value through other comprehensive income (FVOCI) are measured at fair value, with changes in fair value recognized in other comprehensive income until derecognition[190] - Financial assets that do not meet the criteria for amortized cost or FVOCI are classified as fair value through profit or loss (FVTPL)[193] - The company classifies equity instruments as FVTPL unless irrevocably designated as FVOCI, with the policy of designating equity investments not held for trading as FVOCI[200] - The company assesses expected credit losses using forward-looking information and confirms related loss provisions at each reporting date[196] - For financial asset transfers that do not meet derecognition criteria, the company recognizes a financial liability based on the consideration received and subsequently recognizes all expenses arising from the liability[192] - The company recognizes interest income for financial assets that become credit-impaired after initial recognition based on their amortized cost and effective interest rate[195] - The company derecognizes financial assets partially when the transfer meets derecognition criteria, recognizing the difference between the consideration received and the allocated carrying amount in profit or loss[197] Insurance Business - The company's insurance business includes life insurance, long-term health insurance, and annuity insurance, with a 0.3% fee on business income, and 0.05% for investment-linked insurance[22] - The company's life insurance and long-term health insurance reserves are calculated based on the insurer's obligations for ongoing policies, with liabilities recognized for policyholder surplus in participating insurance accounts[28] - Short-term health insurance and accident insurance require a 0.8% contribution based on business income[40] - Investment-linked insurance accounts are measured at fair value and reported as separate account assets[39] - Risk margin calculation considers factors such as expense, incidence, mortality, lapse rate, discount rate, and universal insurance premium lapse rate[38] - The discount rate assumption for participating insurance contracts as of June 30, 2023, was 4.85%, consistent with the rate used on December 31, 2022[114] - The risk margin for non-life insurance unearned premium reserves was determined to be 3%, based on industry guidance[115] Trust and Asset Management Business - The company's trust business manages trust assets separately from its own assets, with each trust project independently accounted for and reported[22] - The company's asset management business operates based on internal organizational structure and management requirements, with segment information disclosed accordingly[25] - Trust compensation reserve is 5% of the annual net profit after tax, capped at 20% of the registered capital[43] Risk Reserves and Capital Guarantees - The company's general risk reserve is calculated at 10% of the annual net profit for certain subsidiaries, used for risk compensation and not for dividends or capital increases[32] - Risk reserve for factoring business must not be less than 1% of the outstanding balance of financing factoring business at the end of the period[34] - Capital guarantee deposits are 20% of the registered capital, as stipulated by the Insurance Law of China[41] Financial Performance and Cash Flow - The company's total assets amounted to RMB 129.79 billion, with non-current assets totaling RMB 59.35 billion[91] - The company's total liabilities included short-term borrowings of RMB 546.15 million and trade payables of RMB 429.02 million[91] - The company's total equity investments amounted to RMB 11.00 billion, with other equity instrument investments at RMB 7.64 billion[91] - The company's total debt investments amounted to RMB 8.18 billion, with other debt investments at RMB 31.10 billion[91] - The company's total long-term receivables amounted to RMB 3.91 billion, with long-term equity investments at RMB 3.82 billion[91] - The company's total fixed assets amounted to RMB 94.05 million, with construction in progress at RMB 920.23 million[91] - The company's total intangible assets amounted to RMB 1.52 billion, with goodwill at RMB 0[91] - The company's total deferred tax assets amounted to RMB 490.14 million, with other non-current assets at RMB 872.67 million[91] - The company's total current liabilities amounted to RMB 546.15 million, with trade payables at RMB 429.02 million[91] - The company's total non-current liabilities amounted to RMB 10.15 billion, with long-term borrowings at RMB 0[91] - Total liabilities increased to 2,190,882,841.88 RMB, up from 1,945,280,287.33 RMB in the previous period[93] - Total owner's equity stood at 16,291,351,722.46 RMB, slightly higher than 16,069,049,456.98 RMB in the previous period[93] - Operating income for the first half of 2023 was 234,120.02 RMB, a significant decrease from 626,331.11 RMB in the same period last year[110] - Net profit for the first half of 2023 was 494,576,171.57 RMB, compared to 255,486,589.35 RMB in the same period last year[110] - Investment income for the first half of 2023 was 442,576,356.67 RMB, up from 386,886,121.41 RMB in the same period last year[110] - Fair value change income for the first half of 2023 was 154,215,294.93 RMB, a significant improvement from a loss of 121,062,215.20 RMB in the same period last year[110] - Net cash flow from operating activities for the first half of 2023 was 419,896,005.23 RMB, a substantial improvement from a negative cash flow of 46,241,467.12 RMB in the same period last year[112] - Cash received from investment returns for the first half of 2023 was 61,529,351.61 RMB, compared to 433,917,164.69 RMB in the same period last year[112] - Net profit attributable to shareholders increased by RMB 310.25 million in the first half of 2023, reaching RMB 607.50 million[133] - Total assets as of June 30, 2023, amounted to RMB 18.48 billion, compared to RMB 18.01 billion at the end of 2022[128] - The company's long-term equity investments remained stable at RMB 15.96 billion during the first half of 2023[128] - Other comprehensive income decreased by RMB 87.94 million in the first half of 2023, primarily due to changes in fair value of financial assets[133] - Total liabilities decreased slightly to RMB 2.16 billion as of June 30, 2023, from RMB 2.19 billion at the end of 2022[128] - The company's total equity increased by RMB 222.30 million in the first half of 2023, reaching RMB 16.29 billion[133] - Investment activities resulted in a net cash outflow of 6,475,921,239.78 yuan, a decrease from the previous year's outflow of 8,012,460,791.83 yuan[150] - Financing activities generated a net cash inflow of 1,962,451,369.22 yuan, compared to 5,024,821,713.33 yuan in the previous year[150] - The net increase in cash and cash equivalents was 204,755,968.12 yuan, significantly lower than the previous year's increase of 2,286,963,863.13 yuan[150] - The ending balance of cash and cash equivalents was 14,523,794,201.95 yuan, slightly lower than the previous year's balance of 14,616,143,909.63 yuan[150] - The company received 2,273,862,000.00 yuan from other financing-related activities, a decrease from 5,437,223,000.00 yuan in the previous year[150] - The company paid 49,008,710,366.23 yuan for investments, an increase from 43,685,170,890.65 yuan in the previous year[150] - The company received 1,343,457,886.36 yuan from investment returns, a decrease from 1,454,286,042.88 yuan in the previous year[150] - The company paid 257,341,163.29 yuan for dividends, profits, or interest payments, an increase from 224,527,231.42 yuan in the previous year[150] - The company's cash outflow for investment activities totaled 49,372,406,348.28 yuan, an increase from 44,014,592,350.41 yuan in the previous year[150] - The company's cash inflow from financing activities totaled 2,459,073,616.65 yuan, a decrease from 5,770,257,480.37 yuan in the previous year[150] Legal and Regulatory Matters - COFCO Trust won a lawsuit with a claim amount of 6,270.47 million RMB, and the second-instance judgment has taken effect[66] - COFCO Trust won another lawsuit with a claim amount of 5,084.22 million RMB, and the second-instance judgment has taken effect[66] - COFCO Trust won a third lawsuit with a claim amount of 8,064 million RMB, and the second-instance judgment has taken effect[66] - COFCO Trust won a financial loan contract dispute with a claim amount of 92,112.36 million RMB, and the first-instance judgment has taken effect[66] - COFCO Trust won a stock pledge dispute with a claim amount of 4,590.03 million RMB, and the first-instance judgment has taken effect[66] Corporate Social Responsibility and Rural Revitalization - The company established a rural revitalization charity trust to support agricultural development[60] - COFCO Futures and COFCO Trust jointly conducted rural revitalization research in Beijing's Daxing District and signed a strategic cooperation agreement with the Daxing District Agriculture and Rural Affairs Bureau to support rural revitalization[61] Financial Reporting and Accounting Standards - The company's financial statements are prepared in accordance with the "Basic Standards for Enterprise Accounting" and other specific accounting standards issued by the Ministry of Finance, ensuring compliance and accurate reflection of the company's financial status[157][158] - The company uses RMB as its functional currency for financial reporting[173] - The company consolidates financial statements by offsetting significant internal transactions and balances within the group, with minority interests separately presented in the consolidated financial statements[176] - The company assesses the risk of impairment for assets such as construction in progress and land use rights, estimating recoverable amounts when impairment indicators are present[185] - The company uses the spot exchange rate on the balance sheet date for translating foreign currency assets and liabilities, with exchange rate differences recorded in other comprehensive income[179] - The company's cash flow statement includes cash and cash equivalents, defined as highly liquid investments with maturities of three months or less[178] - For subsidiaries acquired under common control, the company includes their operating results and cash flows from the beginning of the period in the consolidated financial statements[188] - The company adjusts capital reserves or retained earnings for the difference between the disposal consideration and the corresponding share of the subsidiary's net assets when partially disposing of a subsidiary without losing control[188] Inflation and Economic Assumptions - The company's inflation rate assumption is 2.5% annually, affecting expense assumptions[56] Subsidiary Activities and Ownership Structure - The company's subsidiary, COFCO Futures, plans to issue up to RMB 500 million in subordinated bonds to professional investors in 2023[121] - COFCO Capital's ownership structure changed significantly in 2018-2019 through a major asset restructuring with COFCO Group[134]