Shenzhen China Bicycle Company (Holdings) Limited
Summary of Semi-Annual Report 2020I. Important NoticeThe summary is abstract from full-text of semi-annual report, for more details of operating results, financial condition and futuredevelopment plan of the Company; investors should found in the full-text of semi-annual report that published on media appointedby CSRC.Other directors attending the Meeting for semi-annual report deliberation except for the followed
| Name of director absent | Title for absent director | Reasons for absent | Attorney |
Prompt of non-standard audit opinion
□ Applicable √ Not applicable
Profit distribution pre-plan of common stock or capitalizing of common reserves pre-plan deliberated by the Board in the reportingperiod
□ Applicable √ Not applicable
The Company has no plans of cash dividend distributed, no bonus shares and has no share converted from capital reserve.Profit distribution pre-plan of preferred stock deliberated and approved by the Board in the reporting period
□ Applicable √ Not applicable
II. Company profile
1. Company Profile
| Short form of the stock | *ST Zhonghua –A, *ST Zhonghua –B | Stock code | 000017, 200017 | |
| Stock exchange for listing | Shenzhen Stock Exchange | |||
| Person/Way to contact | Secretary of the Board | Rep. of security affairs | ||
| Name | Sun Longlong | Yu Xiaomin, Zhong Xiaojin | ||
| Office add. | 501 Zhongxin Technology Building, No.31 Bagua Rd., Bagualing, Futian District, Shenzhen | 501 Zhongxin Technology Building, No.31 Bagua Rd., Bagualing, Futian District, Shenzhen | ||
| Tel. | 0755-25516998,28181666 | 0755-25516998,28181666 | ||
| dmc@szcbc.com | dmc@szcbc.com | |||
2. Main accounting data and financial indexes
Whether it has retroactive adjustment or re-statement on previous accounting data or not
□Yes √ No
| Current period | Same period of last year | Increase/decrease in this report y-o-y | |
| Operating revenue (RMB) | 42,656,355.21 | 38,274,433.02 | 11.45% |
| Net profit attributable to shareholders of the listed company (RMB) | 2,797,643.50 | -798,946.17 | -450.17% |
| Net profit attributable to shareholders of the listed company after deducting non-recurring gains and losses (RMB) | 2,197,907.57 | -910,390.17 | -341.42% |
| Net cash flow arising from operating activities (RMB) | 1,350,395.94 | -8,901,256.74 | -115.17% |
| Basic earnings per share (RMB/Share) | 0.0051 | -0.0014 | -464.29% |
| Diluted earnings per share (RMB/Share) | 0.0051 | -0.0014 | -464.29% |
| Weighted average ROE | 32.84% | -5.74% | 38.58% |
| End of current period | End of last period | Increase/decrease in this report-end over that of last period-end | |
| Total assets (RMB) | 74,493,806.65 | 62,733,602.58 | 18.75% |
| Net assets attributable to shareholder of listed company (RMB) | 9,917,039.80 | 7,119,396.30 | 39.30% |
3. Number of shares and shares held
In Share
| Total common stock shareholders in reporting period-end | 44,039 | Total preference shareholders with voting rights recovered at end of reporting period (if applicable) | 0 | ||||||
| Top ten shareholders | |||||||||
| Full name of Shareholders | Nature of shareholder | Proportion of shares held | Shareholding numbers | Amount of restricted shares held | Number of share pledged/frozen | ||||
| State of share | Amount | ||||||||
| Shenzhen Guosheng Energy Investment Development Co., Ltd. | Domestic non-State-owned legal person | 11.52% | 63,508,747 | 0 | |||||
| UOB Koy Hian (Hong Kong) Co., | Foreign legal person | 2.89% | 15,907,850 | 0 | |||||
| Ltd. | ||||||
| Guosen Securities (Hong Kong) brokerage Co., Ltd. | Foreign legal person | 2.52% | 13,909,425 | 0 | ||
| Shenwan Hongyuan Securities (Hong Kong) Co., Ltd. | Foreign legal person | 1.51% | 8,303,272 | 0 | ||
| Li Huili | Domestic nature person | 0.71% | 3,891,124 | 0 | ||
| Xu Hongbo | Domestic nature person | 0.58% | 3,187,419 | 0 | ||
| Ge Zhiqiong | Domestic nature person | 0.58% | 3,177,952 | 0 | ||
| LI SHERYN ZHAN MING | Foreign natural person | 0.57% | 3,157,600 | 0 | ||
| CMS Hong Kong Co., Ltd | State-owned legal person | 0.54% | 2,999,676 | 0 | ||
| Special Account for Property Disposal of Bankrupt Enterprise of CBC | Domestic non-State-owned legal person | 0.47% | 2,602,402 | 0 | ||
| Explanation on associated relationship among the aforesaid shareholders | Li Huili, spouse of the Ji Hanfei, the actual controller of the Company- Shenzhen Guosheng Energy Investment Development Co., Ltd., holding B-share of the Company on behalf of Shenzhen Guocheng Energy Investment Development Co., Ltd., beyond that, the Company has no idea of whether other circulated shareholders belong to concerted action persons ruled in the Administration Norms for Information Disclosure of Change on Shareholding of Shareholders of Listed Companies. | |||||
| Shareholders involving margin business (if applicable) | N/A | |||||
4. Changes of controlling shareholders or actual controller
Changes of controlling shareholders in reporting period
□ Applicable √ Not applicable
Changes of controlling shareholders had no change in reporting period.Changes of actual controller in reporting period
□ Applicable √ Not applicable
Changes of actual controller in reporting period had no change in reporting period.
5. Total preferred stock shareholders of the Company and shares held by top ten shareholders withpreferred stock held
□ Applicable √ Not applicable
No preferred stock in reporting period.
6. Corporation Bonds
Whether the Company has a corporation bonds that issuance publicly and listed on stock exchange and withoutdue on the date when annual report approved for released or fail to cash in full on dueNo
III. Discussion and analysis by the Management Team
1. Introduction of operation in the reporting period
The sudden novel coronavirus epidemic brought serious threats to the lives and health of people in all countries, and caused severeimpacts on the world economy. The social economy faced serious difficulties and the company's operations face with special risks. Inresponse to the epidemic, under the leadership of the party and government, the people of the whole country have taken effectiveprevention and control measures based on their own conditions and achieved positive results. While doing a good job in theprevention and control of the epidemic, the government, enterprises, and employees have made concerted efforts to restore economicand social development and enterprise production and operation. The government has taken multiple measures to stabilize people'slivelihood and enterprises and employment, and the company increased revenue and cut expenditures to ensure business and stabilityand survival and development. The government's assistance measures for enterprises include extending holidays, returning socialsecurity to stabilize employment, issuing post-stabilization subsidies, exempting enterprise pension insurance, issuing anti-epidemicsubsidies, providing loan discounts and liquidity support, etc. The company's measures include extending holidays, strengtheningdisinfection and epidemic prevention, home office, flexible office and other measures, doing everything possible to maintainupstream and downstream business, adopting capital vitalization, optimizing and adjusting business premises, and reducing expensesto ensure corporate cash flow, creating conditions to ensure the health of employees, the stability of the team, the stability of thesociety and the guarantee of employment, and contributing the enterprise’s strength for success of the epidemic prevention andcontrol. With the joint efforts of the government, enterprises, and employees, the company's business operations began to graduallyrecover at the end of the first quarter. So far, the business recovery has been generally smooth. The company will continue to do agood job in epidemic prevention and control and the recovery and development of enterprise production and operation.
In first half of 2020, combine actual condition of financially insecure after reorganization, on the one hand, we adhere to traditionalbusiness model development, in combination with the new national standard of safety technical specifications for electric bicycle, theCompany carry out R&D works on the products. Optimize and adjust the product structure and sales mode transformation, activelyexpand the e-commerce business model in accordance with the e-commerce transformation of business team and controllable cost ofinternal & external connections, so as to realize the stable development of e-commerce for retail business; at the same time, based onthe long-term process of the electric bicycle business, the follow-up research of related industrial projects and technologyapplications in the upstream and downstream of the industrial chain have been carried out accordingly, and on the basis of extensivebusiness contacts and businesses in previous years, it continued to expand the lithium battery material business to enrich the mainbusiness. On the one hand, continued to promote the development of the jewelry gold supply chain business and expand the businessdimension. In August 2019, the company and Shenzhen Zuankinson Jewelry Co., Ltd. jointly invested 6.5 million yuan to establishShenzhen Xinsen Jewelry and Gold Supply Chain Co., Ltd., the company holding 65% of the shares as the controlling shareholder ofShenzhen Xinsen Jewelry and Gold Supply Chain Co., Ltd., while Zuankinson Jewelry holding 35% of the shares. According to theactual situation of business development, in February 2020, the two parties decided to increase the capital of Shenzhen XinsenJewelry and Gold Supply Chain Co., Ltd. to 20 million yuan in the same proportion, and the relevant registered capital have been inplace in June 2020. In order to meet the future operation and development needs of Shenzhen Xinsen Jewelry and Gold Supply ChainCo., Ltd., and enhance its financial strength, comprehensive competitiveness and anti-risk ability, the company signed a capitalincrease contract with the joint venture Shenzhen Zuankinson Jewelry and Gold Supply Chain Co., Ltd. in August 2020, and onceagain increased capital to Shenzhen Xinsen Jewelry and Gold Supply Chain Co., Ltd. in the same proportion, and the registered
capital was increased from 20 million yuan to 200 million yuan, of which the company increased capital of 117 million yuan, whichwould be successively invested in accordance with its own funds and the availability of funds raised from the non-public issuance ofA shares; Zuankinson Jewelry newly increased capital of 63 million yuan, totaling 180 million yuan. On August 21, 2020, thecompany's 2020 second extraordinary general meeting of shareholders reviewed and approved the above capital increase. On the onehand, we strived to promote the selection of the company's restructuring party and plan for the non-public issuance of stocks, hopingto improve the company's business strength and development potential.
In terms of planning for the non-public issuance of stocks, the company started planning for the non-public issuance of stocks in July2016, and hired brokers, lawyers and accountants and other intermediary agencies to cooperate in various tasks. Since then, thenineteenth (temporary) meeting, the twenty-second (temporary) meeting, the twenty-sixth (temporary) meeting of the ninth board ofdirectors and the second extraordinary general meeting of the company in 2017 reviewed and approved the proposals related to thenon-public issuance of stocks. In combination with the capital market and the actual situation of the company, from January toFebruary 2018, the fourth (temporary) meeting of the company's tenth board of directors and the company's first extraordinarygeneral meeting of shareholders in 2018 reviewed and approved the Proposal on Adjusting the Scheme of the Company's Non-publicIssuance of A Shares, and the Proposal on Preplanning for the Company’s Non-public Issuance of A Shares (Third Revised Draft)and other related proposals. According to the above proposals, the total amount of funds raised in this non-public issuance of sharesshould not exceed 750 million yuan, after deducting the issuance costs, it is planned to invest 680 million yuan in the "online andoffline marketing network platform construction upgrade project", and it is planned to invest 70 million yuan in the "R&D centerconstruction project". On April 21, 2020, the company held the nineteenth (interim) board meeting of the tenth session of the boardof directors, and reviewed and approved the "Proposal on the Termination of Agreement of the Conditionally Effective ShareSubscription Agreement (Second Revised Draft) Signed with the Original Subscription Object" and the "Proposal on the Preplanningfor the Non-public Issuance of A Shares by Shenzhen China Bicycle (Holdings) Co., Ltd.", etc. The company terminated thenon-public issuance of shares matter in 2016 and at the same time launched the preplanning for non-public issuance of A shares in2020, and planned to raise funds of total amount not exceeding 450 million yuan through non-public issuance of shares from 5specific investors, including Wansheng Industrial Holdings (Shenzhen) Co., Ltd., Fuzhou Zuankinson Jewelry Co., Ltd., ShenzhenYilian Jinchuang Technology Co., Ltd., Shenzhen Hualinglong Jewelry Co., Ltd. and Shenzhen Jindaogu Jewelry Co., Ltd., and allthe funds would be used to supplement working capital after deducting the issuance costs. At present, the company's non-publicissuance plan of 2020 has been reviewed and approved by the company's shareholders meeting, and the follow-up still needs to beapproved by the China Securities Regulatory Commission. Related work is in progress.
In the context of the still sluggish domestic traditional manufacturing industry, the company insisted on accelerating its ownprofessional transformation and e-commerce transformation in accordance with the guidelines of "Made in China 2025", strived toexpand business dimensions to enrich main business, strengthened structural adjustments, and strengthened quality management,intensified cost and expense management and control, and strived to improve the ability of traditional enterprises to adapt to the neweconomic normal and the ability to participate in market competition. Through all kinds of work hard, in first half of 2020, theCompany achieved operating revenue of 42.6564 million yuan, net profit amounted to 3.4206 million yuan and the net profitattributable to shareholder of listed company amounted to 2.7976 million yuan.As the operating revenue with jewellery concerned in first half of 2020 accounts for more than 30% of the operating revenue of theCompany, the Company shall comply with the disclosure requirement of “Guidelines on Industry Information Disclosure ofShenzhen Stock Exchange No. 11- Listed Company Engaged in Jewelry-related Business”, specific information are as:
(1) Operation of the physical store in reporting period
During the reporting period, gold and jewelry business of the Company mainly provides supply chain management and services inthe vertical field of gold and jewelry, it connects with the downstream gold jewelry brand and does not have the physical stores.
(2) Operation of the on-line sales in reporting period
The Company does not have on-line sales in the Period
(3) Inventory in the reporting period
As of end of the Period, balance of inventory from jewelry business amounted to 32,115,676,800 yuan, a 19.21% down comparedwith that of period-begin, types of the inventory includes:
In 10 thousand yuan
| Item | Types | Amount | Proportion |
| Finished goods | Jewelry | 327,919.84 | 10.21% |
| Gold jewelry | — | — | |
| Other | — | — | |
| Total | 327,919.84 | 10.21% | |
| Raw materials | Gold | — | — |
| Platinum | — | — | |
| Diamond | 753,891.51 | 23.47% | |
| Total | 753,891.51 | 23.47% | |
| Wrappage | 16,754.16 | 0.52% |
| Goods in process | 2,113,002.17 | 65.79% | |
| Total | 3,211,567.68 | 100.00% |
2. Relevant items involving financial report
(1) Particulars about the changes in aspect of accounting policy, estimates and calculation methodcompared with the financial report of last fiscal period
√ Applicable □ Not applicable
| The contents and reasons of accounting policy changes | Examination and approval procedures |
| According to the regulations of "Accounting Standards for Business Enterprises No. 14 - Revenue" of the Ministry of Finance, domestic listed companies are required to implement this accounting standard from January 1, 2020. The Company has implemented the "Accounting Standards for Business Enterprises No. 14 - Revenue" (CK [2017] No. 22) revised by the Ministry of Finance from January 1, 2020. | Deliberated and approved by 24th session of 10th BOD |
In accordance with the relevant regulations for the connection of the old and new standards, no adjustments are made to comparableperiod information, and the cumulative impact of the implementation of the new standards adjusts the amount of retained earnings atthe beginning of the period and other related items in the financial statements. The specific impact of the implementation of the newrevenue standard on the Company is that the contract-related advance receipts are changed from the "advance receipts" item to the"contract liabilities" item in presentation.
(2) Major accounting errors within reporting period that needs retrospective restatement
□ Applicable √ Not applicable
No major accounting errors within reporting period that needs retrospective restatement for the Company in reporting period.
(3) Particulars about the change of consolidation range compared with the financial report of last fiscalperiod
□ Applicable √ Not applicable
The Company had no particular about the change of consolidation range compared in reporting period.
Board of Directors ofShenzhen China Bicycle Company (Holdings) Limited
27 August 2020