Stock Code: 002242 Stock Abbreviation: Joyoung Report No.2019-065 Joyoung Co., Ltd Abstract of Third Quarterly Report of 2019 Section I Important StatementsThis is an abstract of Third Quarterly Report of 2019 (hereinafter referred to as the“Report”). Investors are kindly reminded to read the complete version of the Report onthe website which is designated by the China Securities Regulatory Commission to getcomplete information about operational results, financial statements and future plans ofthe company.In the event of any discrepancy between the abstract and the full document of theReport, the full document version shall prevail.The Board of Directors, the Supervisory Committee as well as all the directors,supervisors and senior management staff of Joyoung Co., Ltd. (hereinafter referred toas the “Company”) have warranted that this Report contains no false record, misleadingstatement or material omission. And they shall be jointly and severally liable for thefactuality, accuracy and completeness of the information given in this Report.All directors attended the board meeting that reviewed this Report.Xuning WANG, Legal Representative of the Company; Jiantiao QIU, CFO of theCompany, and Miao Miao, Chief Accountant of Accounting Institution, declared that thequarterly financial statements should be true, accurate and complete. Section II Company Profile 1. Key Accounting Data and Financial Indicators Whether the Company performed a retroactive adjustment to or restatement of accounting data □ Yes √ No | 30 September 2019 | 31 December 2018 | Flux (%) | | Total assets (RMB Yuan) | 6,228,140,934.50 | 6,660,086,381.54 | -6.49% | | Net assets attributable to shareholders of the Company (RMB Yuan) | 3,530,015,847.75 | 3,810,291,395.62 | -7.36% | | From 1 July 2019 to 30 September 2019 | Flux (%) | From 1 January 2019 to 30 September 2019 | Flux (%) | | Operating revenues (RMB Yuan) | 2,068,019,945.39 | 14.98% | 6,254,990,267.26 | 15.02% | | Net profits attributable to shareholders of the Company (RMB Yuan) | 211,822,515.10 | 6.35% | 617,827,914.32 | 8.54% | | Net profits attributable to shareholders of the Company before non-recurring gains and losses (RMB Yuan) | 205,099,809.10 | 18.68% | 582,586,867.39 | 25.20% | | Net cash flow from operating activities (RMB Yuan) | 745,207,988.94 | 282.40% | 922,017,459.40 | 120.33% | | Basic earnings per share (RMB Yuan /share) | 0.28 | 7.69% | 0.81 | 9.46% | | Diluted earnings per share (RMB Yuan /share) | 0.28 | 7.69% | 0.81 | 9.46% | | Weighted average ROE | 5.49% | 0.33% | 16.01% | 1.26% |
Non-recurring gains and losses item and amount Unit: RMB yuan | Item | From 1 January 2019 to 30 September 2019 | Note | | Profit or loss from disposal of non-current assets (including the write off of the provision for impairment of assets) | 5,499,793.46 | | | Government Grant included in the current profit and loss (closely related to the business of the company, exclusive of the quota and quantitative grant according to the national uniform standards) | 26,734,353.98 | | | Except for effectively hedging business related to normal business operations of the Company, profit or loss arising from the change in the fair value of held-for-trading financial assets and liabilities, as well as investment profit or loss produced from the disposal of held-for-trading financial assets and liabilities and available-for-sale financial assets | 13,522,115.34 | |
| Other Non-Operating income and expenses besides those mentioned above | -1,784,214.94 | | | Less: Corporate income tax | 8,584,653.27 | | | Minority interests (after tax) | 146,347.64 | | | Total | 35,241,046.93 | -- |
There were no such non-recurring items that should be reclassified to the recurring items, according to the <Explanatory AnnouncementNo. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Non-Recurring Profits and Losses> 2. Total number of shareholders and shareholdings of the top ten shareholders at the period-end 2.1 Total number of common shareholders, total number of preferred shareholders with resumed voting rights at theend of the Reporting Period and shareholdings of the top ten common shareholders at the period-end Unit: share | Total number of common shareholders at the end of the Reporting Period | 27,044 | Total number of preferred shareholders with resumed voting rights at the end of the Reporting Period (if any) | 0 | | Top 10 common shareholders | | Name of shareholder | Nature of shareholder | Shareholding percentage | Total shares held at the period-end | Number of restricted shares held | Pledged or frozen shares | | Status | Number | | Shanghai Lihong Enterprise Management Limited | Domestic non-state-owned corporation | 50.11% | 384,523,746 | | Pledged | 339,272,626 | | Bilting Developments Limited | Foreign corporation | 16.93% | 129,924,090 | | | | | Central Huijin Investment Ltd. | State-owned corporation | 4.99% | 38,310,500 | | | | | Hong Kong Securities Clearing Co., Ltd. | Foreign corporation | 2.50% | 19,218,928 | | | | | E Fund Management Co., Ltd. - Social Insurance Fund Portfolio No. 1104 | Others | 1.55% | 11,930,073 | | | | | Basic Pension Insurance Fund Portfolio No. 1206 | Others | 0.54% | 4,136,381 | | | | | AEGON INDUSTRIAL Fund Management Co., Ltd. - Industrial Bank Co., Ltd. - AEGON INDUSTRIAL - Stock Dividend Specific Multi-Client Asset Management Plan | Others | 0.52% | 3,979,442 | | | | | National Social Security Fund Portfolio No. 502 | Others | 0.46% | 3,508,647 | | | |
| Agricultural Bank of China Co., Ltd. - CSI 500 Exchange Trade Fund | Others | 0.43% | 3,299,581 | | | | | Basic Pension Insurance Fund Portfolio No. 1205 | Others | 0.40% | 3,041,324 | | | | | Top 10 non-restricted common shareholders | | Name of shareholder | Number of non-restricted shares held | Type of shares | | Type of shares | Number | | Shanghai Lihong Enterprise Management Limited | 384,523,746 | RMB common stock | 384,523,746 | | Bilting Developments Limited | 129,924,090 | RMB common stock | 129,924,090 | | Central Huijin Investment Ltd. | 38,310,500 | RMB common stock | 38,310,500 | | Hong Kong Securities Clearing Co., Ltd. | 19,218,928 | RMB common stock | 19,218,928 | | E Fund Management Co., Ltd. - Social Insurance Fund Portfolio No. 1104 | 11,930,073 | RMB common stock | 11,930,073 | | Basic Pension Insurance Fund Portfolio No. 1206 | 4,136,381 | RMB common stock | 4,136,381 | | AEGON INDUSTRIAL Fund Management Co., Ltd. - Industrial Bank Co., Ltd. - AEGON INDUSTRIAL - Stock Dividend Specific Multi-Client Asset Management Plan | 3,979,442 | RMB common stock | 3,979,442 | | National Social Security Fund Portfolio No. 502 | 3,508,647 | RMB common stock | 3,508,647 | | Agricultural Bank of China Co., Ltd. - CSI 500 Exchange Trade Fund | 3,299,581 | RMB common stock | 3,299,581 | | Basic Pension Insurance Fund Portfolio No. 1205 | 3,041,324 | RMB common stock | 3,041,324 | | Related or acting-in-concert parties among shareholders above | Shanghai Lihong Enterprise Management Co., Ltd. and Builting Developments Limited, both controlled by Mr. Xuning WANG, are defined as acting-in-concert parties by the Administrative Measures for the Takeover of Listed Companies. Other than the aforementioned related and acting-in-concert parties, the Company is uncertain about whether there are related or acting-in-concert parties among shareholders above. | | Explanation on the top 10 common shareholders participating in securities margin trading (if any) | N/A |
The company's top 10 common shareholders and the top 10 common shareholders with unrestricted in terms of sale hadn’t engage inthe agreed repurchase transactions during the reporting period. 2.2 Total Number of Preferred Shareholders and TOP 10 Preferred Shareholders and Their Shareholdings □ Applicable √ Not applicable Section III Significant Events 1. Major Changes of Main Items in Financial Statements and Financial Indicators Within the ReportPeriod, as well as the Reasons for the Changes Unit: RMB yuan | Item | From 1 January 2019 to 30 September 2019 | From 1 January 2018 to 30 September 2018 | Flux (%) | Notes |
| General and administrative expenses | 254,647,689.31 | 179,761,212.35 | 41.66% | Mainly due to the increase on wages and business travel expenses of administrative staff and amortization of stock incentive expenses |
| Financial expenses | -6,979,286.19 | -16,077,864.78 | -56.59% | Mainly due to less foreign exchange gains |
| Investment income | 52,824,492.32 | 131,355,402.02 | -59.79% | Mainly due to the disposal of subsidiary and the dividends from associated companies |
| Including: income from associated companies and joint ventures | 3,453,253.98 | 39,720,292.24 | -91.31% | Mainly due to the dividends from associated companies |
| Credit impairment losses | -8,577,774.25 | | 100.00% | Mainly due to the changes of accounting policy that receivables and other receivables are included in credit impairment losses | | | | | | Asset impairment losses | -7,617,071.36 | -12,166,788.52 | -37.39% |
| Add: Gains on changes in fair value | 1,587,949.57 | | 100.00% | Mainly due to the changes of foreign exchange rate during the reporting period, which resulted in the changes in other non-current financial assets fair value |
| Gains on disposal of assets | 6,298,909.35 | 12,719,572.17 | -50.48% | Mainly due to less disposal of assets in the reporting period |
| Non-operating expenses | 12,184,310.83 | 6,374,674.57 | 91.14% | Mainly due to the increase on donation expenditures |
| Minority interests | -10,247,044.56 | -3,853,695.47 | -165.90% | Mainly due to that the Company’s subsidiary was still at a loss |
| Other comprehensive income | 7,424,903.36 | -2,274,842.44 | 426.39% | Mainly due to the fluctuation in exchange rate in the reporting period |
| Total comprehensive income attributable to minority interests | -10,247,044.56 | -3,853,695.47 | -165.90% | Mainly due to that the Company’s subsidiary was still at a loss |
| Item | From 1 January 2019 to 30 September 2019 | From 1 January 2018 to 30 September 2018 | Flux (%) | Notes |
| Net cash flow from operating activities | 922,017,459.40 | 418,462,966.54 | 120.33% | Mainly due to the increase on income, resulting in an increase on cash inflows |
| Net cash received from disposal of fixed assets, intangible assets and other long-term assets | 579,500.00 | 47,390,251.34 | -98.78% | Mainly due to the government's compensation to the land and building on ground in Zhangqiu, Shandong during 1 January 2018 to 30 September 2018 |
| Net cash received from disposal of subsidiaries and other business units | | 103,683,299.35 | -100.00% | Mainly due to the disposal of Joyoung Suzhou company during 1 January 2018 to 30 September 2018 |
| Cash paid to acquire fixed assets, intangible assets and other long-term assets | 35,473,059.50 | 128,722,563.33 | -72.44% | Mainly due to the reduction of the purchasing of fixed assets in the reporting period |
| Cash paid to acquire investments | 20,748,877.88 | 50,493,008.25 | -58.91% | Mainly due to the reduction of investing activities in the reporting period |
| Cash paid relating to other investing activities | 1,393,000,000.00 | 955,000,000.00 | 45.86% | Mainly due to the increase on financial products purchases during the reporting period |
| Net cash flow from investing activities | -551,880,575.39 | 186,253,647.00 | -396.31% | Mainly due to the increase on financial products purchases during the reporting period |
| Cash received from capital contributions | | 24,500,000.00 | -100.00% | Mainly due to the acquisition 51% shareholders of SharkNinja (China), resulting in an increase in minority shareholder input during 1 January 2018 to 30 September 2018 |
| Cash received relating to other financing activities | 210,000,000.00 | 4,800,000.00 | 4275.00% | Mainly due to bills discounting this reporting period |
| Cash paid relating to other financing activities | 219,566,986.11 | 164,092,818.96 | 33.81% | Mainly due to the increase of security deposit paid for bill pledge |
| Effect of foreign exchange rate changes on cash and cash equivalents | 6,219,240.13 | 13,698,259.12 | -54.60% | Mainly due to less exchange gains in the reporting period |
| Item | 30 September 2019 | 1 January 2019 | Flux (%) | Notes |
| Notes receivable | 1,254,860,625.68 | 2,401,908,241.50 | -47.76% | Mainly due to the honouring of notes receivable in the reporting period |
| Accounts receivable | 481,165,200.39 | 170,334,201.29 | 182.48% | Mainly due to the increase on income |
| Advances to suppliers | 95,056,320.75 | 50,140,039.04 | 89.58% | Mainly due to advance payments to suppliers to secure the price of materials |
| Including: interest receivable | 8,772,130.27 | 1,087,939.73 | 706.31% | Mainly due to the increase of financial products in the reporting period, resulting in the increase of interest receivable |
| Other current assets | 721,819,911.36 | 212,098,049.34 | 240.32% | Mainly due to the increase of financial products in the reporting period |
| Available-for-sale financial assets | | 453,798,187.73 | -100.00% | Mainly due to the change of accounting policy that equity |
| Other equity instrument investments | 250,667,645.89 | | 100.00% | investments are included in “other equity instrument investments” and “other non-current financial assets” | | | | | | Other non-current financial assets | 289,111,242.71 | | 100.00% |
| Construction in progress | 15,062,768.93 | 9,525,015.95 | 58.14% | Mainly due to the increase of a small number of construction projects in the reporting period |
| Deferred tax assets | 51,231,924.10 | 98,823,262.64 | -48.16% | Mainly due to paying the expenses recognized by the end of the last reporting period in the reporting period |
| Notes payable | 749,962,721.17 | 398,577,915.90 | 88.16% | Mainly due to the increase of notes payable issued through the Supply Chain Finance in the reporting period |
| Advances from customers | 272,182,091.82 | 539,246,286.69 | -49.53% | Mainly due to the transfer from advances from customers to payments |
| Employee benefits payable | 19,588,204.65 | 199,388,479.30 | -90.18% | Mainly due to paying the yearly bonus recognized by the end of 2018 in the reporting period |
| Taxes payable | 57,892,277.64 | 139,042,561.43 | -58.36% | Mainly due to tax payment in the reporting period |
| Other payables | 478,960,492.21 | 186,129,378.79 | 157.33% | Mainly due to the recognition of the semi-annual dividends |
| Including: dividends payable | 383,656,000.00 | | 100.00% | Mainly due to the recognition of the semi-annual dividends |
| Other current liabilities | 34,285.69 | | 100.00% | Mainly due to the reclassification of patent royalties resulted from the finish of its amortization within one year |
| Deferred tax liabilities | 15,308,571.84 | 349,699.95 | 4277.63% | Mainly due to the changes of accounting policies during the reporting period, which resulted in the increase in FVTPL&FVOCI fair value as well as tax liabilities on future disposal |
| Other non-current liabilities | | 2,279,999.98 | -100.00% | Mainly due to the reclassification of patent royalties into other current liabilities resulted from the finish of its amortization within one year |
| Less: treasury stock | 3,402,960.00 | 4,999,960.00 | -31.94% | Because the company has exercised the circulation of its incentive restricted stock in the reporting period |
| Other comprehensive income | 24,734,354.69 | -1,179,916.24 | 2196.28% | Mainly due to the changes of accounting policies during the reporting period, which resulted in the change in FVOCI fair value. |
| Minority interests | 9,321,593.20 | 19,568,637.77 | -52.36% | Mainly due to that the Company’s subsidiary was still at a loss |
2. Analysis of the Progress of Important Matters and Their Impact and SolutionsThe 20th meeting of the 4th Board of Directors held on August 13, 2019 and the 2nd Extraordinary Shareholders'Meeting of 2019 held on September 11, 2019 reviewed and approved the Proposal on the Distribution of Profits of theSemi-annual 2019. The Company intends to deduct the 59,000 repurchased and then cancelled shares from the Company's total share capital of 767,371,000 by the end of June 2019. That is, based on 767,312,000 shares, the Company intends todistribute cash dividends of 5 yuan (tax inclusive) per 10 shares to all shareholders with a total of RMB 383,656,000 yuan cashdividends, with no stock dividend and no capital reserves converted into share capital. | Overview of important matters | Date of disclosure | Website index for disclosed reports | | 2019 semi-annual distribution of profits | 15 August 2019 | Please refer to Report No. 2019-054 on Cninfo website (http://www.cninfo.com.cn). |
The implementation of share-buyback The Company's 14th meeting of the 4th Board of Directors held in October 2018 and the first Extraordinary ShareholdersMeeting of 2018 held in November 2018 reviewed and approved the Preparation of Some Public Shares Buyback. TheCompany intended to use no less than RMB 40 million yuan and no more than (including) RMB 80 million yuan self-ownedfunds to buy back some of the Company's shares in centralized competitive biddings. The buy-back price will not exceed RMB20 yuan/share (adjusted to RMB 18.70 yuan/share after the 2018 annual and the 2019 semi-annual distributions of profits).The share buyback time limit is no more than 12 months from its date of approval by the shareholder meeting. By the end ofthe reporting period, the Company had not bought back any shares.The implementation of reducing buy-back shares through centralized competitive bidding □ Applicable √ Not applicable 3. Commitments Made by the Actual Controller, Shareholders, Related Parties, Purchasers and OtherRelevant Parties That Have not been Fulfilled the Correspondent Promise Within the Reporting Period □ Applicable √ Not applicable 4. Financial Assets Measured at Fair Value Unit: RMB yuan | Classes of assets | Initial Capital Investment | Gains on changes in fair value | Accumulated changes in fair value recognized in equity | Amount purchased in the reporting period | Amount disposed in the reporting period | Accumulated investment income | Amount by the end of the reporting period | Source of fund | | Funds | 232,420,187.73 | 1,587,949.57 | 61,506,044.80 | 0.00 | -7,741,551.59 | 90,391,983.01 | 289,111,242.71 | Self-owned capital | | Others | 221,378,000.00 | 6,038,296.19 | 29,289,645.89 | | | | 250,667,645.89 | Self-owned capital | | Total | 453,798,187.73 | 7,626,245.76 | 90,795,690.69 | 0.00 | -7,741,551.59 | 90,391,983.01 | 539,778,888.60 | -- |
5. Illegal external guarantee □ Applicable √ Not applicable 6. The Non-operating Funds Occupation of the Controlling Shareholders and Its Related Parties □ Applicable √ Not applicable 7. Trust Investment Unit: 10,000 RMB yuan | Type | Source of fund for trust investment | Amount of recorded trust investment | Premature balance | Overdue balance | | Bank financial products | Self-owned capital | 87,300 | 35,074.76 | 0 | | Trust financial products | Self-owned capital | 52,000 | 32,000 | 0 | | Total | 139,300 | 67,074.76 | 0 |
The specific situation of high-risk, low security, poor liquidity or non-guarantee trust investment of significant amount □ Applicable √ Not applicable Trust investment is expected to be unable to recover the principal or other circumstances that may result in impairment □ Applicable √ Not applicable 8. Registration Forms for Research, Communication and Interviews During the Reporting Period. | Date | Reception method | Reception object type | Basic information index | | 02 July 2019 | On site | Institution | Please refer to the company’s activity record for investor relationships on 2 and 5 July 2019 on Cninfo website. | | 05 July 2019 | On site | Institution | | 15 August 2019 | Call | Institution | Please refer to the company’s activity record for investor relationships on 15 and 16 August 2019 on Cninfo website. | | 16 August 2019 | On site | Institution | | 16 September 2019 | On site | Institution | Please refer to the company’s activity record for investor relationships on 16 September 2019 on Cninfo website. | | 18 September 2019 | On site | Institution | Please refer to the company’s activity record for investor relationships on 18 September 2019 on Cninfo website. |
|
