CHINA MERCHANTS PORT GROUP CO., LTD.
ANNUAL REPORT 2023
Date of disclosure: 2 April 2024
Chairman’s Statement
Dear Shareholders,I hereby present to you the annual report of China Merchants Port Group Co., Ltd. and its subsidiaries(the Company or CMPort) for the year ended 31 December 2023. On behalf of the Board, I wouldlike to express my sincere gratitude to all of you for your long-term support to the Company.The Company is a crucial vehicle for China Merchants Group to implement the development tasks ofthe "14th Five-Year Plan" and the strategy of Guangdong-Hong Kong-Macao Greater Bay Area.Serving not only as the core enterprise of China Merchants Group's port sector, the Company is alsothe capital operation and management platform for the group's global port assets, hence playing a keyrole in the consolidation and synergistic development of China Merchants Group’s port assets. TheCompany has become a world-leading port investor, developer and operator.By implementing new development concepts based on the new development stage and building a newdevelopment pattern, CMPort will strive to promote its high-quality development and become a high-quality worldclass comprehensive port service provider. While cultivating innovative businesses witha focus on core port businesses, strengthening the supporting role of scientific and technologicalinnovation and building an independent and controllable terminal operating system, it will strive tobuild a smart and diverse port ecosystem. By actively exploring and participating in global portresource integration opportunities, optimizing the port network system on a continuous basis andstrengthening external and internal coordination, we will provide customers with more economical,higher-quality, and more efficient service solutions and deepen strategic cooperation with customers,thus creating greater value for the Company and more returns for shareholders, and making animportant contribution to maintaining the safety, stability, and smoothness of the supply chain.REVIEW FOR THE YEARIn 2023, the global economy continued to step a slow recovery from the influence of geopolitics andthe conflict between Russia and Ukraine, showing some resilience. Extreme situations such aseconomic recession and deep-seated financial crisis that the international community was worriedabout have not occurred, but economic activity remains at a weak level and sluggish economicrecovery still plagues most countries. Global economic growth has been keeping up a slower anduneven development as divergence among nations was increasingly intensifying, especially inemerging markets and developing economies. With the differentiation between regions becomingapparent and uncertainties increasing, which brought great challenges to the daily operation andmanagement of enterprises. Facing the complicated external environment, the Company took "high-quality development" as its central task and "lean operation and global layout" as its guidance, tosolidly advance endogenous growth as well as innovation and upgrading and give a strong andeffective respond to the impact of unexpected factors, hence successfully completed various businesstasks and enjoyed a good situation of high-quality development.Financial performance: In 2023, the Company achieved operating income of RMB15.75 billion anda total profit of RMB8.8 billion. The net profit attributable to the parent company was RMB3.57billion, up by 6.98% year-on-year, and the operating performance increased steadily, handing over a
satisfactory answer.Business performance: In terms of container business, the Company handled a total containerthroughput of 180.195 million TEUs in 2023, up by 23.5% year-on-year, of which the containerthroughput handled by mainland port projects was 140.306 million TEUs, up by 33.4% year-on year;In terms of bulk cargo business, the Company handled a bulk cargo volume of 1,250 million tonnesin 2023, representing an increase of 69.6% year-on-year, mainly because the Company, as a strategicinvestor, completed the subscription for the A Shares of Ningbo Port issued under the non-publicissuance of A Shares in 2021, and the business volume of Ningbo Port has been included in theCompany's statistics from October 2022, bringing 31.374 million TEUs of containers and 490 milliontonnes of bulk cargo increments in 2023.In terms of key priorities, first, we achieved new breakthroughs in overseas expansion. The Companyinvested in the construction of the South Asia Commercial and Logistics Hub to further enhance thecore competitiveness of overseas homebase ports. China Merchants Port, the holding subsidiary ofthe Company, signed a contract to acquire the equity of PT Nusantara Pelabuhan Handal Tbk (NPH)in Indonesia, which made an important breakthrough in the layout of Southeast Asia and will furthershare the opportunities from the rapid development of the RCEP region. Second, we made a newprogress in the homebase port position. In 2023, the Company not only increased its domestic andoverseas homebase port market share, but also further improved its service efficiency indicators andcustomer satisfaction, with explosive growth in HIPG RoRo and oil and gas businesses. Third, weexplore new benefits in cost control. In 2023, adhering to the concept of "all costs are controllable"and advocating the cost control culture of "macro-cost control concept" and "little by little makesextraordinary", the Company formulated a combined action plan for quality and efficiencyimprovement to promote cost optimization in multiple dimensions and effectively promote profitimprovement. Fourth, we achieved new achievements in smart technology. As CTOS progresses toversion 5.0 and serves 15 customer companies in 6 countries, its influence continued to grow. "CMePort " achieved full coverage of domestic main ports and terminals, providing customers one-stopintelligent services. Smart Management Platform (SMP) won the special prize of the 2023 Scienceand Technology Prize of China Port and Harbors Association. Fifth, ESG construction took a newstep. In 2023, the Company was selected into the "ESG-Pioneer 100 Index of Central Enterprises (央企ESG.先锋100指数)" and "China Securities Times ESG Top 100 Index (中证证券时报ESG百强指数)", and ranked in the list of "Most Valued ESG Top 100 of Chinese Listing Companies". Oursubsidiary China Merchants Port's Morgan Stanley Capital International (MSCI) rating is "BB",having its rating rose two levels in a row.OUTLOOKLooking forward to 2024, the global economic recovery process is expected to remain slow anduneven, and the impact of major international events such as the Russia-Ukraine conflict, thePalestinian-Israeli conflict and the Red Sea crisis will remain for a long time. Global polarizationcontinues to expand. Global economic and trade growth is at historically low levels, with a markedslowdown in the growth of developed economies and a projected relatively modest decline in thegrowth of emerging markets and developing economies. At the same time, large-scale global electionswill bring more uncertainty, and the global political and economic situation will be complicated. 2024
is a critical year for China to implement the "14th Five-Year Plan". China will stay committed to thegeneral principle of making advances while maintaining stable performance and its economicrecovery is poised to undergo consolidation and strengthening and effectively improve the quality ofthe economy and promote its growth within a reasonable range. It is expected that the gradualimplementation of various economic stabilization policies along with the continuous release of theeffects of various trade agreements, China will further enhance the flow of elements of cross-bordertrade, strengthen the momentum of commodity import and export, and provide new growthopportunities for the port industry. In addition, the coordinated digital and green transformation anddevelopment of the port will also inject new vitality into the port industry.2024 is a critical year to achieve the goals and tasks of the "14th Five-Year Plan". By focusing ondigital intelligence technology and green technology to improve core competitiveness, the Companywill take on the responsibility in this new journey to play the role of supporting functions of theindustry, thereby enhancing its core capabilities. First, we will always stick to our original intentionsand build strategic strength in unison with unbreakable faith. By strengthening the construction ofheadquarters capacity and enhancing the expansion capacity of overseas terminals, we will continueto push forward the implementation of various strategies. Second, consolidating what it has achievedand break new ground, play it by ear and, improve innovation and advance reform to create a leadingforce. We will strengthen collaborative innovation to transform and upgrade the port's main businessby creating differentiated competitive advantages in digital intelligence technology and seizing thegreen technology development trend. Third, we will intensively cultivate and continue to optimize tobuild professional strength with lean operations. By insisting on quality and efficiency improvement,and completing the Center of Excellence (COE) working mechanism and team building, we willimplement lean management in all aspects to strengthen cost control and strive to reduce costs andincrease efficiency, so as to establish a professional, efficient and strong operation and managementheadquarters. Four, we will forge ahead and develop as a whole to build a high-quality developmentwhich is supported. We will co-ordinate the construction of strong ports, key projects, party buildingwork and safe production, thereby pushing forward the high-quality development of CMPort to a newlevel!APPRECIATIONIn 2023, facing the tough external situation and a range of risk challenges, CMPort has adhered tostrategic guidance and focused on endogenous growth as well as innovation and upgrading tosignificantly improve its lean operational capabilities and accelerate the pace of global restructuring,while all key tasks have progressed smoothly and performance has maintained a steady and upwardtrend. All of these could not be accomplished without the dedication of all of our staff and the supportfrom our shareholders and investors, business partners and those in the society who have taken toheart the Group’s interest. For this, I would like to extend my most sincere appreciation and deepestgratitude.
Feng BomingChairman
Part I Important Notes, Table of Contents and DefinitionsThe Board of Directors (or the “Board”), the Supervisory Committee as well as the directors,supervisors and senior managers of China Merchants Port Group Co., Ltd. (hereinafter referred to asthe “Company”) hereby guarantee the factuality, accuracy and completeness of the contents of thisReport and its summary, and shall be jointly and severally liable for any misrepresentations,misleading statements or material omissions therein.Xu Song, the Company’s legal representative, Tu Xiaoping, the Company’s Chief Financial Officer,and Hu Shaode, the person-in-charge of the accounting organ hereby guarantee that the financialstatements carried in this Report are factual, accurate and complete.All the Company’s directors have attended the Board meeting for the review of this Report and itssummary.Any forward-looking statements such as future plans or development strategies mentioned hereinshall not be considered as the Company’s promises to investors. And investors are reminded toexercise caution when making investment decisions. Possible risks faced by the Company andcountermeasures have been explained in “Part III Management Discussion and Analysis” herein,which investors are kindly reminded to pay attention to.Securities Times, China Securities Journal, Shanghai Securities News, and www.cninfo.com.cn havebeen designated by the Company for information disclosure. And all information about the Companyshall be subject to what’s disclosed on the aforesaid media. Investors are kindly reminded to payattention to these media.The Board has approved a final dividend plan as follows: based on the latest total 2,499,462,404shares, a cash dividend of RMB5.80 (tax inclusive) per 10 shares is to be distributed to shareholders,with no bonus issue from either profit or capital reserves.This Report and its summary have been prepared in both Chinese and English. Should there be anydiscrepancies or misunderstandings between the two versions, the Chinese version shall prevail.
Table of Contents
Chairman’s Statement ...... 1
Part I Important Notes, Table of Contents and Definitions ...... 4
Part II Corporate Information and Key Financial Information ...... 9
Part III Management Discussion and Analysis ...... 17
Part IV Corporate Governance ...... 62
Part V Environmental and Social Responsibility ...... 106
Part VI Significant Events ...... 114
Part VII Share Changes and Shareholder Information ...... 149
Part VIII Preference Shares ...... 159
Part IX Bonds ...... 160
Part X Financial Statements ...... 173
Documents Available for ReferenceI. Financial Statements carrying the signatures and stamps of the Company Principal, the ChiefFinancial Officer and the person in charge of accounting firm;II. The 2023 Auditor's Report stamped by the accounting firm and signed and stamped byregistered accountants; andIII. Original copies of all documents and the announcements thereof disclosed in the ReportingPeriod on Securities Times, China Securities Journal, Shanghai Securities News, Ta Kung Pao(HK) and www.cninfo.com.cn.
Definitions
Term
| Term | Definition |
| The “Company”, “CMPort” or “we” | China Merchants Port Group Co., Ltd., formerly known as “Shenzhen Chiwan Wharf Holdings Limited” |
| CMG | China Merchants Group Co., Limited |
| CMPort Holdings | China Merchants Port Holdings Company Limited (00144.HK) |
| CMGD | China Merchants Gangtong Development (Shenzhen) Co., Ltd., a Broadford Global majority-owned subsidiary in Shenzhen |
| CND Group | China Nanshan Development (Group) Inc. |
| Chiwan Wharf | Shenzhen Chiwan Wharf Holdings Limited (stock name: Chiwan Wharf/ Chiwan Wharf-B; stock code: 000022/200022) |
| Malai Storage | Shenzhen Malai Storage Co., Ltd. |
| CMPID | China Merchants Port Investment Development Company Limited |
| The “Assets Purchase via Share Offering” | Chiwan Wharf’s purchase of 1,313,541,560 ordinary CMPort Holdings shares from CMPID via share offering |
| Broadford Global | Broadford Global Limited, a wholly-owned subsidiary of CMG Hong Kong |
| CSRC | China Securities Regulation Commission |
| TEU | Twenty Foot Equivalent Unit |
| RCEP | Regional Comprehensive Economic Partnership |
| CM ePort | The wharf e-commerce platform, i.e. the unified customer service platform |
| Shunde New Port | Guangdong Yide Port Limited |
| Dongguan Machong | Dongguan Chiwan Port Service Co., Ltd. |
| SIPG | Shanghai International Port (Group) Co., Ltd. |
| CMICT | Ningbo Daxie China Merchants International Container Terminal Co., Ltd. |
| Ningbo Port | Ningbo Zhoushan Port Company Limited |
| Liaoning Port/ Dalian Port | Liaoning Port Co., Ltd., formerly known as Dalian Port (PDA) Company Limited |
| Yingkou Port | Yingkou Port Co., Ltd. |
| QQCTU | Qingdao Qianwan United Container Terminal Co., Ltd. |
| QQTU | Qingdao Qianwan United Terminal Co., Ltd. |
| Qingdao Dongjiakou | Qingdao Port Dongjiakou Ore Terminal Co., Ltd. |
| Laizhou Port | Yantai Port Group Laizhou Port Co. LTD |
| Tianjin Port Container Terminal | Tianjin Port Container Terminal Co., Ltd. |
| Shantou Port | Shantou CMPort Group Co., Ltd. |
| Zhangzhou Port | Zhangzhou China Merchants Port Co., Ltd. |
| Xiamen Port | Zhangzhou China Merchants Xiamen Port Affairs Co., Ltd. |
| Zhanjiang Port | Zhanjiang Port (Group) Co., Ltd. |
| CMCS | China Merchants Container Services Limited |
| Modern Terminals | Modern Terminals Limited |
| Taiwan Kao Ming Container | Kao Ming Container Terminal Corp. |
CICT
| CICT | Colombo International Container Terminals Ltd. |
| HIPG | Hambantota International Port Group |
| TCP | TCP Participa??es S.A. |
| LCT | Lome Container Terminal Ltd. |
| TICT | Tin-Can Island Container Terminal Ltd. |
| PDSA | Port de Djibouti S.A. |
| Kumport | Kumport Liman Hizmetleri ve Lojistik Sanayi ve Ticaret Anonim Sirketi |
| TL | Terminal Link S.A.S. |
| CMBL | China Merchants Bonded Logistics Co., Ltd. |
| China Merchants Hoi Tung | China Merchants Hoi Tung Trading Company Limited |
| NPH | PT Nusantara Pelabuhan Handal TBK |
| Haixing Harbor | Shenzhen Haixing Harbor Development Co., Ltd. |
| SASAC of the State Council | State-Owned Assets Supervision and Administration Commission of the State Council |
| CMB | China Merchants Bank Co., Ltd. |
| Seaport Group | Zhejiang Provincial Seaport Investment & Operation Group Co. Ltd. |
| Ningbo Zhoushan Port Group | Ningbo Zhoushan Port Group Co., Ltd. |
| Cyber Chic | Cyber Chic Company Limited, a wholly-owned subsidiary of the Company’s majority-owned subsidiary China Merchants Port Holdings Company Limited |
| The cninfo website | www.cninfo.com.cn |
| SZSE | Shenzhen Stock Exchange |
| The “Articles of Association” | The Articles of Association of China Merchants Port Group Co., Ltd. |
| RMB RMB’0,000 RMB’00,000,000 | Expressed in the Chinese currency of Renminbi Expressed in tens of thousands of Renminbi Expressed in hundreds of millions of Renminbi (unless otherwise specified) |
Note: In this Report, certain total numbers may not be exactly equal to the summation of their sub-item numbers as a result of roundoff.
Part II Corporate Information and Key Financial InformationI Corporate Information
Stock name
| Stock name | CM Port Group/ CM Port Group B | Stock code | 001872/201872 |
| Stock exchange for stock listing | Shenzhen Stock Exchange | ||
| Company name in Chinese | 招商局港口集团股份有限公司 | ||
| Abbr. | 招商港口 | ||
| Company name in English | China Merchants Port Group Co., Ltd. | ||
| Abbr. | CMPort | ||
| Legal representative | Xu Song | ||
| Registered address | 23-25/F, China Merchants Port Plaza, 1 Gongye 3rd Road, Zhaoshang Street, Nanshan, Shenzhen, PRC | ||
| Zip code | 518067 | ||
| Changes of registered address | On 14 December 2018, the Company completed the formalities with the competent industrial and commercial administration to change its registered address from “8/F, Chiwan Petroleum Plaza, Zhaoshang Street, Nanshan, Shenzhen, PRC” to “23-25/F, China Merchants Port Plaza, 1 Gongye 3rd Road, Zhaoshang Street, Nanshan, Shenzhen, PRC”. | ||
| Office address | 23-25/F, China Merchants Port Plaza, 1 Gongye 3rd Road, Zhaoshang Street, Nanshan, Shenzhen, PRC | ||
| Zip code | 518067 | ||
| Company website | http://www.cmp1872.com | ||
| Email address | Cmpir@cmhk.com | ||
II Contact Information
| Board Secretary | Securities Representative | |
| Name | Li Yubin | Hu Jingjing |
| Address | 24/F, China Merchants Port Plaza, 1 Gongye 3rd Road, Zhaoshang Street, Nanshan, Shenzhen, PRC | 24/F, China Merchants Port Plaza, 1 Gongye 3rd Road, Zhaoshang Street, Nanshan, Shenzhen, PRC |
| Tel. | +86 755 26828888 | +86 755 26828888 |
| Fax | +86 755 26886666 | +86 755 26886666 |
| Email address | Cmpir@cmhk.com | Cmpir@cmhk.com |
III Media for Information Disclosure and Place where this Report Is Lodged
| Stock exchange website where this Report is disclosed | http://www.szse.cn |
Media and website where this Report isdisclosed
| Media and website where this Report is disclosed | Securities Times, China Securities Journal, Shanghai Securities News, and www.cninfo.com.cn |
| Place where this Report is lodged | Board Office |
IV Change to Company Registered Information
| Unified social credit code | 91440300618832968J |
| Change to principal activity of the Company since going public (if any) | On 14 December 2018, the Company changed its business scope registered with the industrial and commercial administration. The new business scope includes: construction, management and operation of ports and wharves; bonded warehousing of various goods for import and export; development, construction and operation of supporting parks in ports; loading, unloading, transhipment, warehousing and transportation of international and domestic goods and processing of goods; devanning and LCL operations, cleaning, repairing, manufacturing and leasing of containers; international freight forwarding; vehicle and ship leasing; the provision of ship and port services including the provision of fuels, supplies and daily necessities for ships; ship towing (no operation using foreign ships); leasing and repair services of port facilities, equipment and machinery; import and export of various goods and technologies on a self-operation or agency basis, excluding the goods and technologies restricted or forbidden for import and export by the state; port logistics and port information technology consulting services; technical development and services in respect of modern logistics information systems; supply chain management and related services; design of logistics plans; engineering project management; development, research and consulting services in respect of port engineering technologies. (In respect of any operations that require approval according to law, the approval must be obtained before operation). |
| Every change of controlling shareholder since incorporation (if any) | 1. On 8 June 2018, as the ownership of 209,687,067 Chiwan Wharf shares formerly held by CND Group and 161,190,933 Chiwan Wharf shares formerly held by Malai Storage was officially transferred to CMGD, CMGD, holding 57.52% of the Company’s outstanding share capital, became the controlling shareholder of the Company. Meanwhile, CMG remains the actual controller of the Company. 2. On 26 December 2018, the Company issued RMB-denominated ordinary shares (A-shares) at RMB21.46/share to CMPID for the acquisition of the 1,313,541,560 CMPort Holdings ordinary shares that it held. Upon the Acquisition, the Company’s total share capital has become 1,793,412,378 shares. Meanwhile, as Broadford Global controls an 87.81% aggregated voting right in the Company (direct interests and interests through CMPID and CMGD), it is the direct controlling shareholder of the Company. Meanwhile, CMG remains the actual controller of the Company. 3. Zhejiang Provincial Seaport Investment & Operation Group Co., Ltd. subscribed for 576,709,537 shares of the Company offered in a non-public manner at RMB18.50 per share. The subscribed shares were floated on Shenzhen Stock Exchange on 12 October 2022. Upon the Acquisition, Broadford Global directly holds the Company’s equity and controls an |
63.02% aggregated voting right in the Company through controllingCMPID and CMGD. Broadford Global is the direct controlling shareholderof the Company. Meanwhile, CMG remains the actual controller of theCompany.
V Other InformationThe independent audit firm hired by the Company:
63.02% aggregated voting right in the Company through controllingCMPID and CMGD. Broadford Global is the direct controlling shareholderof the Company. Meanwhile, CMG remains the actual controller of theCompany.Name
| Name | Deloitte Touche Tohmatsu Certified Public Accountants LLP |
| Office address | 30/F, 222 Yan An Road East, Huangpu District, Shanghai, P.R.C. |
| Accountants writing signatures | Li Weihua, and Wang Hongmei |
The independent sponsor hired by the Company to exercise constant supervision over the Companyin the Reporting Period:
| Name | Office address | Representatives | Period of supervision |
| China International Capital Corporation Limited | 27/F and 28/F, Tower 2, China World Trade Center, 1 Jianguomenwai Avenue, Chaoyang District, Beijing | Wu Jiaqing, and Peng Yanzhe | 12 October 2022 - 31 December 2023 |
| China Merchants Securities Co., Ltd. | No.111, Fuhua Yi Road, Futian Street, Futian District, Shenzhen, Guangdong, P.R.China | Wang Dawei, and Li Mingze | 12 October 2022 - 31 December 2023 |
VI Key Financial InformationIndicate by tick mark whether there is any retrospectively restated datum in the table below.
√ Yes □ No
On November 30, 2022, the Ministry of Finance promulgated the Interpretation of AccountingStandards for Business Enterprises No. 16, in which the provision that "deferred income tax relatedto assets and liabilities arising from single transactions does not apply to the accounting treatmentof initial recognition exemption" took effect on January 1, 2023. The Company has implementedthe above provisions since January 1, 2023, adopted the retrospective adjustment method foraccounting treatment, and restated the comparative annual financial statements.
| 2023 | 2022 | 2023-over- 2022 change | 2021 | |||
| Before | Restated | Restated | Before | Restated | ||
| Operating revenue (RMB) | 15,750,475,780.22 | 16,230,489,127.55 | 16,230,489,127.55 | -2.96% | 15,283,808,174.60 | 15,283,808,174.60 |
| Net profit attributable to the listed | 3,571,800,762.16 | 3,337,446,222.82 | 3,338,693,816.70 | 6.98% | 2,685,829,204.07 | 2,685,752,918.53 |
company’sshareholders (RMB)
| company’s shareholders (RMB) | ||||||
| Net profit attributable to the listed company’s shareholders before exceptional gains and losses (RMB) | 3,339,226,783.73 | 3,345,170,153.81 | 3,365,017,880.33 | -0.77% | 2,355,700,274.23 | 2,373,623,431.15 |
| Net cash generated from/used in operating activities (RMB) | 6,579,606,635.17 | 6,920,377,390.35 | 6,920,377,390.35 | -4.92% | 6,510,326,570.48 | 6,510,326,570.48 |
| Basic earnings per share (RMB/share) | 1.43 | 1.61 | 1.61 | -11.18% | 1.40 | 1.40 |
| Diluted earnings per share (RMB/share) | 1.43 | 1.61 | 1.61 | -11.18% | 1.40 | 1.40 |
| Weighted average return on equity (%) | 6.35% | 7.54% | 7.54% | -1.19% | 6.99% | 6.99% |
| 31 December 2023 | 31 December 2022 | Change of 31 December 2023 over 31 December 2022 (%) | 31 December 2021 | |||
| Before | Restated | Restated | Before | Restated | ||
| Total assets (RMB) | 198,557,296,667.26 | 197,525,530,887.76 | 197,587,102,447.31 | 0.49% | 175,984,101,168.66 | 176,040,600,182.21 |
| Equity attributable to the listed company’s shareholders (RMB) | 58,847,592,947.55 | 54,267,143,304.02 | 54,291,425,886.65 | 8.39% | 39,801,188,662.13 | 39,822,241,022.30 |
Indicate by tick mark whether the lower of the net profit attributable to the listed company’sshareholders before and after exceptional gains and losses was negative for the last three accounting
years, and the latest independent auditor’s report indicated that there was uncertainty about theCompany’s ability to continue as a going concern.
□ Yes √ No
Indicate by tick mark whether the lower of the net profit attributable to the listed company’sshareholders before and after exceptional gains and losses was negative.
□ Yes √ No
The total share capital at the end of the last trading session before the disclosure of this Report:
Total share capital at the end of the last trading sessionbefore the disclosure of this Report (share)
| Total share capital at the end of the last trading session before the disclosure of this Report (share) | 2,499,462,404 |
Fully diluted earnings per share based on the latest total share capital above:
| Fully diluted earnings per share based on the latest total share capital above (RMB/share) | 1.4290 |
VII Accounting Data Differences under China’s Accounting Standards for BusinessEnterprises (CAS) and International Financial Reporting Standards (IFRS) and ForeignAccounting Standards
1. Net Profit and Equity under CAS and IFRS
□ Applicable √ Not applicable
No difference for the Reporting Period.
2. Net Profit and Equity under CAS and Foreign Accounting Standards
□ Applicable √ Not applicable
No difference for the Reporting Period.
3. Reasons for Accounting Data Differences between Domestics and Foreign AccountingPrinciple
□ Applicable √ Not applicable
VIII Key Financial Information by Quarter
Unit: RMB
| Q1 | Q2 | Q3 | Q4 | |
| Operating revenue | 3,693,584,257.97 | 4,101,677,313.02 | 3,960,045,863.71 | 3,995,168,345.52 |
| Net profit attributable to the listed company’s shareholders | 850,039,606.18 | 1,052,295,153.25 | 1,246,983,201.06 | 422,482,801.67 |
| Net profit attributable to the listed company’s shareholders before exceptional gains and losses | 724,465,592.72 | 1,076,927,780.43 | 1,201,169,655.63 | 336,663,754.95 |
| Net cash generated from/used in operating activities | 699,050,929.84 | 1,611,794,376.12 | 1,578,995,551.67 | 2,689,765,777.54 |
Indicate by tick mark whether any of the quarterly financial data in the table above or theirsummations differs materially from what have been disclosed in the Company’s quarterly or semi-yearly reports.
□ Yes √ No
IX Exceptional Gains and Losses
Unit: RMB
| Item | 2023 | 2022 | 2021 | Note |
| Gain or loss on disposal of non-current assets (inclusive of impairment allowance write-offs) | 231,205,985.85 | -104,372,804.10 | 233,551,553.79 | The subsidiary of the Company was publicly listed on the Beijing Equity Exchange to transfer 45% of the equity of Ningbo Daxie, and recognized the long-term equity investment disposal income of 205,336,602.02 yuan, which was recognised as exceptional gain this year. |
| Government grants recognised in current profit or loss (exclusive of those that are closely related to the Company's normal business operations and given in accordance with defined criteria and in compliance with government policies, and have a | 149,238,503.34 | 150,227,881.76 | 270,061,990.27 | - |
continuing impacton the Company'sprofit or loss)
| continuing impact on the Company's profit or loss) | ||||
| Gain or loss on fair-value changes in financial assets and liabilities held by a non-financial enterprise, as well as on disposal of financial assets and liabilities (exclusive of the effective portion of hedges that arise in the Company’s ordinary course of business) | 73,352,800.52 | -129,033,650.11 | 221,242,275.17 | The price of Qingdao Port shares held by Company has increased compared to the beginning of the year, and the fair value loss has decreased year-on-year due to the conversion of Antong Holdings to equity method accounting. |
| Capital occupation charges on a non-financial enterprise that are charged to current profit or loss | 194,897,544.80 | 189,123,975.49 | 232,343,789.35 | - |
| Reversed portions of impairment allowances for receivables which are tested individually for impairment | 52,962,785.14 | 18,730,660.58 | 93,196.96 | - |
| Current profit or loss on subsidiaries obtained in business combinations involving enterprises under common control from the period-beginning to combination dates, net | - | - | -3,255,790.50 | - |
| Custodian fees earned from entrusted operation | - | - | 1,663,396.22 | - |
| Non-operating income and expense other than the above | 12,810,280.19 | 216,674,035.87 | -4,065,501.22 | - |
| Other gains and losses that meet the definition of exceptional gain/loss | - | -213,574,591.16 | - | - |
| Less: Income tax effects | 145,340,260.29 | 6,703,875.74 | 175,837,436.29 | - |
Non-controllinginterests effects (netof tax)
| Non-controlling interests effects (net of tax) | 336,553,661.12 | 147,395,696.22 | 463,667,986.37 | - |
| Total | 232,573,978.43 | -26,324,063.63 | 312,129,487.38 | -- |
Particulars about other gains and losses that meet the definition of exceptional gain/loss:
□ Applicable √ Not applicable
No such cases for the Reporting Period.Explanation of why the Company reclassifies recurrent gain/loss as an exceptional gain/loss itemlisted in the Explanatory Announcement No. 1 on Information Disclosure for Companies OfferingTheir Securities to the Public—Exceptional Gain/Loss Items:
□ Applicable √ Not applicable
No such cases for the Reporting Period.
Part III Management Discussion and AnalysisI. Industry Overview of the Company during the reporting period
1. External environment analysis
(1) Macroeconomic environment
In 2023, the global economy showed its resilience to some extent. Even though some extremecircumstances of the international community’s concern, such as economic recession and deep-rootedfinancial crisis, were not observed, most countries have been plagued by the sluggish economicrecovery. In view of the continuous adjustment of the global economic landscape, severe geopoliticalsituations, frequent regional conflicts, a rampant backlash against globalization, the markedly risingunilateralism and protectionism, price fluctuations in the commodity market, persistent inflation andthe accumulated global financial market risks, the global economic development has been faced withrisks and challenges. The widening global divergence, especially in emerging markets and developingeconomies, has become increasingly pronounced among regions, bringing more uncertainties toglobal economic development and not conducive to a sound recovery of the global economy.According to the “World Economic Outlook” published by the International Monetary Fund (“IMF”)in January 2024, the global economy in 2023 was expected to increase by 3.1% year-on-year,representing a decrease of 0.4 percentage points. Specifically, developed economies were expectedto grow by 1.6%, representing a decrease of 1.0 percentage points year-on-year, while emergingmarkets and developing economies were expected to grow by 4.1%, keeping flat year-on-year.According to the report published by the U.S. Department of Commerce, the U.S. GDP grew by 2.5%year-on-year in 2023, up 0.6% quarter-on-quarter. According to statistics of Eurostat, affected by thetechnical recession experienced by the economy, in 2023, the Eurozone GDP was expected to growby 0.5% year-on-year, among which German GDP dropped by 0.3% year-on-year, and in the fourthquarter of 2023, French GDP kept flat quarter-on-quarter, up 0.9% year-on-year in the year. In thethird quarter, Japanese GDP recorded its first negative quarterly growth since 2023, and was expectedto drop by 0.5% quarter-on-quarter. With the improvement of exports and private consumption, in thefourth quarter of 2023, South Korea's GDP grew by 0.6% quarter-on-quarter, and up 1.4% year-on-year in the year. In terms of global trade, the volume of global trade was expected to grow by 0.8%in 2023, far below half the forecast in April 2023, which was mainly due to a slowdown in tradeaffected by inflation in developed countries and certain regions.
In the face of a complex and interwoven international environment, China has adhered to the generalprinciple of seeking progress while maintaining stability, made solid efforts to promote high-qualitydevelopment and focused on expanding domestic demand, improving the economic structure,boosting confidence and preventing and defusing risks, which could be seen from the constantlyeffective macro-control policies and increasingly improved market demand. According to thestatistics of the National Bureau of Statistics of China, China’s GDP increased by 5.2% in 2023,taking the lead among the global major economies in terms of economic growth. On the whole, Chinahas survived under the external economic downward pressure, continued to stabilize the scale and
improve the structure, constantly gathered positive strength through various precise and targeteddomestic policies, showing an overall positive development trend. According to the statisticspublished by the General Administration of Customs of the People's Republic of China, the total valueof imports and exports of trade in goods in China amounted to RMB41.76 trillion in 2023,representing an increase of 0.2% year-on-year, among which the total export value was RMB23.77trillion, representing an increase of 0.6% year-on-year, and the total import value was RMB17.99trillion, representing a decrease of 0.3% year-on-year.
The global industrial and supply chain showed a development trend toward fragmentation andregionalization. RCEP has continually delivered policy dividends within two years after its being intoeffect, and industrial cooperation among its members has been constantly deepened, which has furtherresulted in the significantly reduced intra-regional trade costs, providing real benefits to participantsand helping stabilize regional economic development through win-win cooperation. In 2023, theRMB-denominated imports and exports of China, Singapore, Vietnam, Australia and other membersincreased by 2.2%, 5.0% and 9.8%, respectively. The development of digital intelligence technologiessuch as big data, artificial intelligence, cloud computing, Internet of Things and blockchain providenew directions for the international economy and trade, reduce information asymmetry issues arisingin trade, change the international supply-demand relationship, exert a profound impact on the trademodel, structure and pattern, and gradually promote and improve the platform-based trade ecosystem,which will further improve the utilization rate of production factors and the efficiency of tradeoperations.
Looking ahead to 2024, the global economy will maintain its slow growth but remain to be sluggish,with a moderate recovery in international trade. The global economy maintained its slow recoverydue to uncertainties arising from macro-systemic risks. If the "black swan" events such as the spreadof the conflict between Russia and Ukraine concur and increase, it may result in inflation and thereoccurrence of strong unpredictable fluctuations in bulk commodities, which may disturb theeconomic growth of various countries. On the other hand, the recovery of the services sector and thedecline in core inflation provide favorable support for the economic development in 2024. The IMFexpects the global economy to grow by 3.1% in 2024, among which advanced economies, emergingmarket and developing economies grow by 1.5% and 4.1%, respectively.
In 2024, in order to further promote economic recovery, there are certain difficulties and challengesto be overcome by China, mainly including insufficient effective demand, overcapacity in someindustries, weak social expectations, numerous latent risks, blockades in the domestic economiccirculation and rising complexity, severity and uncertainty in the external environment, which willexert certain pressure on economic growth. However, relying on China's mature and completeindustrial and supply chain production advantage and hypermarket superiority, China’s imports andexports occupy a vital position in the international market, plus the coordinated development of thedigital economy and the green economy, laying a good foundation for accelerating the constructionof a modern industrial system. In the next stage, the Chinese government will continue to take thedomestic market as the mainstay while letting domestic and foreign markets boost each other, and theopen and huge Chinese market will continue to support the economy through its imports and exports.
(2) Market environment of the port and shipping industry
The international shipping industry has been deeply affected by the remodeling of the global industrialand supply chain, resulting in significant adjustment of the route layout in 2023. In order to ensurethe security and stability of the supply chain, developed countries have implemented strong policyintervention in the global industrial and supply chain that has been in good and long-time operation,promoting chain links to develop toward short chain, nearshoring and friendshoring. Due to theconcurrence and increase of "black swan" events such as the spread of the conflict between Russiaand Ukraine, a chain effect such as route detour and a surge in shipping costs/freight rates triggeredby "Houthi factor (胡塞因素)", the maritime interests of several countries have been damaged. Thetransshipment of the global trade in goods has also been interfered, with increased instabilities inglobal shipping and global supply chain.
In 2023, uncertainties in the container market increased, resulting in a supply-demand imbalance incontainer shipping market. On the demand side, the purchasing managers' index (PMI) for the globalmanufacturing fell back, and the overall demand for container shipping was weak. The Baltic andInternational Maritime Council (BIMCO) forecast global container traffic growth of -0.5% to 0.5%in 2023. On the supply side, the global shipyards delivered a total of 350 container ships in 2023,with a total capacity of 2.20 million TEU, breaking the record of 1.70 million TEU delivered in 2015,nearly double the number and total capacity delivered last year, and the supply of capacity faroutweighs the growth of demand, thus there is less room and possibility for container freight rates torise in the short term. It is expected that more capacity will be unleashed in 2024, and shippingcompanies will face greater pressure on the operation. Therefore, such companies will focus on costcontrol and business diversification to ensure profits, including optimizing fleet capacity, reducingcharter costs, slow sailing, extending to both ends of the shipping logistics chain and investing inzero-carbon fields.
Affected by the global economy and trade and the international shipping industry, the global majorhub locations recorded a weak growth of container throughput, but the production situation of Asianports presented a certain resilience, in the second half of 2023, except for the continuous decline incontainer throughput in European and American ports, the container throughput in major ports inother regions was back to growth. Drewry, a shipping consultancy, expected global port throughputgrowth of 3% between 2024 and 2027. The total container business volume handled at global majorhub locations decreased slightly, mainly due to significant business volume decline in Europe andNorth America. According to the statistics of Alphaliner, a shipping consultancy, the total containerthroughput of the world's top 20 ports amounted to 277.99 million TEUs for the first three quartersof 2023, representing a decrease of 0.4% year-on-year, and the container throughput growth variedamong regions. Benefiting from the overall recovery of China's economic performance, the effect ofeconomy-driven trade has been lasting, and the foreign trade maintains its stable growth and qualityimprovement, and the business volume handled by ports in mainland China keeps its growth trend,still ranking the world. According to the data released by the National Bureau of Statistics, in 2023,China's mainland ports completed a cumulative container throughput of 310.34 million TEU, anincrease of 4.9%. The cumulative cargo throughput of 17 billion tons, an increase of 8.2%.
(3) The Company’s industry position
The Company is a leading global port investor, developer and operator. As one of the top portoperators in the world, the Company has the resource endowment and unique advantages to build aworld-class comprehensive port service provider. In terms of scale, as at the end of the reportingperiod, the Company has established a relatively complete port network across major hub locationsalong coastal China, with its presence in 51 ports in 26 countries and regions including Asia, Africa,Europe, Oceania, South and North America. In 2023, according to the statistics of Alphaliner, theCompany's equity throughput of containers ranked third among the global port operators in terms ofthe growth of top 20 ports in the third quarter. In terms of quality, the master terminals controlled bythe Company have occupied various market and regional leading positions, continued to promoteESG construction, and strived to create an ESG port benchmark in the industry. In addition, leveragingon the good ground of port technology and based on the CTOS system self-developed by CMPort,the Company has worked out the worldwide first full-case, full-time, all-regime and multi-factortraditional container terminal upgrading solution, and has built the trade facilitation platform for theGuangdong-Hong Kong-Macao Greater Bay Area through blockchain technology, which has beenextended to 30 terminals to help enhance the trade facilitation level in the Greater Bay Area. In termsof performance, the Company has continually promoted high-quality development and has been anindustry leader in terms of net profit margin and overall labour productivity and other indicators.
II. Principal activities of the Company during the reporting period
The Company's core business includes major port business and comprehensive development business,and the nurturing business includes smart technology business and ecological extension business.
The major port business includes containers and bulk cargo handling and warehousing services. TheCompany has established a comprehensive port network across the hub locations along coastal China,and the terminals which the Company invested in or invested in and managed are located in hublocations across Hong Kong, Taiwan, Shenzhen, Ningbo, Shanghai, Qingdao, Tianjin, Dalian,Zhangzhou, Zhanjiang, and Shantou, as well as in Asia, Africa, Europe, Oceania, South and NorthAmerica, amongst others. In terms of port investment, the Company puts emphasis on its presence inglobal major hub locations, gateway ports and regions with huge market potential, rapid economicgrowth and promising development, in order to capture investment opportunities in ports, logisticsand related infrastructure and further improve the global port network.
In terms of the comprehensive development business, leveraging on the innovative park businessmodels and services, the Company conducts in-depth exploration of synergy value between ports andparks, and provides customers with diversified value-added services, including warehousing leasing,customs clearance, division or merger of cargoes, documentation services, amongst others, inShenzhen Qianhaiwan Bonded Port Zone, Qingdao Qianwan Bonded Port Zone, Tianjin DongjiangBonded Port Zone, Djibouti International Free Trade Zone, Hambantota Industrial Park,.
In terms of the smart technology business, the Company utilizes cutting-edge digital technology tofully leverage its advantages of big data and rich application scenarios, drives its industrial
digitalization and digital industrialization, and provides customers with premium port servicesthrough smart port solutions, an open platform for smart ports and smart port technology operations.
In terms of the ecological extension business, which is based on ports as the core and includes porttugboat service, tallying business and engineering supervision and management business, theCompany integrates the port ecological service resources, promotes the collaboration and cooperationbetween the upstream and downstream of the port logistics value chain and lays a key focus on theopenness and sharing of resources, to advance the smooth trade development as well as the efficientoperation of the logistics, information flow and capital flow of the port service chain and further helpcustomers reduce costs and increase efficiency.
The main business segments of the Company are as follows:
Businesssegments
| Business segments | Business content | |
| Core business | Major port business | Port investment: ●The Company puts emphasis on its presence in global major hub locations, gateway ports and regions with huge market potential, rapid economic growth and promising development, in order to capture investment opportunities in ports, logistics and related infrastructure, and further improve the global port network. Port operation: ●Containers: The Company provides ship berthing, loading and unloading services to ship companies, offers container storage service to ship companies and cargo owners and provides overhead box services to tractor companies. The Company also engages in the businesses of division or merger of cargoes in containers, container leasing and container maintenance; ●Bulk cargoes: the Company is engaged in bulk cargo handling and transportation in port zones, as well as storage services in yards. The major types of cargoes handled include food, steel, woods and sandstones. |
| Comprehensive development business | The Company provides various services, including warehouse/yard leasing, loading and unloading in warehouses/yards, customs clearance and division or merger of cargoes at terminals, intermodal transportation, logistics and transportation and value-added warehousing services for clients (including logistics companies, trading companies or cargo owners). Relying on the port-surrounding land resources, the Company conducts the comprehensive development to enhance the land value as well as the value of commercial properties, and provides its customers with quality property leasing and other related services. | |
| Nurturing business | Smart technology | The Company focuses on smart port solutions, an open platform for smart ports and smart port technology operation, accelerates the |
business
| business | industry upgrading from "digitization" to "digital intelligence", continues to empower the core businesses of port production, management, service and ecology, and injects new momentum into port enterprises through digital technology. |
| Ecological extension business | The business is based on ports as the core and includes port tugboat service, tallying business and engineering supervision and management business, and the Company integrates the port ecological service resources, promotes the collaboration and cooperation between the upstream and downstream of the port logistics value chain and lays a key focus on the openness and sharing of resources, to advance the smooth trade development as well as the efficient operation of the logistics, information flow and capital flow of the port service chain and further help customers reduce costs and increase efficiency. |
III. Core Competitiveness Analysis
1. Sound shareholder background and resource integration capability
CMG, the de facto controller of the Company, was the Hundred Years' central State-owned enterprisesstarting with port shipping logistics business that owns excellent reputation and resources availablein the industry.
Founded in 1872, CMG is an integrated and diversified key enterprise under the direct administrationof the PRC central government, also a one of the four major Chinese enterprises in Hong Kong withtwo global companies counted on Fortune Global 500 list. Currently, it mainly focuses on three coreindustries, namely transportation & logistics, integrated finance and comprehensive development ofcities and industrial zones. In recent years, CMG successively realized the transformation from thesethree primary industries to the three major platforms of industrial management, financial services,investment and capital operation, and also began to deploy its footprint in big health, testing and othersectors.
CMG’s Transportation & Logistics Business Department includes port, highway, energy shipping,logistics, naval architecture and marine engineering businesses, and has a wide range of coordinatedspace for industrial chain service. Acceleration of international development and improvement onlogistics network layout will effectively bolster CMPort’s capabilities related to create a world-classport investment and operation platform which can gives a global push as well as an interconnectedinternational port comprehensive service system.
2. Professional and high-efficiency global port investment capability
The Company focuses on port investment, grasps global trend and seizes opportunities in region toachieve full-process and full-cycle management on investments.
As an important carrier for domestic and overseas port investment and operation of CMG, CMPorthas over 20 years of experience for port investment and over 10 years thereof for overseas investment.
A scientific and professional investment management system has been set up with a research teamspecialized in investment global which owns a wealth of experience in policy research, industryanalysis, risk control, fund raising, post-investment management. The Company continues to work indevelopment of global industrial supply chain, keeps up with major strategic opportunities indomestic and dynamic investment opportunities in overseas and properly invests in hub and gatewaysof strategic significance around the world.
The Company strives to balance its investment portfolio within the regional and life cycle of ports.Adhering to the principle of “extensive consultation, joint development and shared benefits”, itsoverseas business has developed local-based business operation and formed a community of sharedfuture based on the consolidation of connectivity and cooperation and expanded new internationalcooperation, to the greater extent that capability strengthened in coping with various risks such asindustry fluctuations, trade conflicts and emergencies.
3. Fleshing out the port comprehensive management capability
The Company has committed to port operation and improved comprehensive management capabilitythrough application of digital intelligence technology and integrated platform.
The Company endeavors to operation management of port business for years, based on digitalmanagement and cost control with aiming at improving quality and efficiency, and thus forms anindustry-leading port operational management system. Self-developed Smart Management Platform(“SMP”) is a united platform that runs through the whole process, connects the whole scene, anddocks the whole system of the enterprise, so as to achieve comprehensive digital management ofbusiness process. It provides a one-stop operating model for the Decision-making personnel,Management and Executive to support the management decision based on the presentation andanalysis of global business core data. In addition, the Company keeps applying measures of costcontrol and forms a complete system thereof, and achieves cost savings and efficiency gains inpractice and effectivity manner with respect of process optimization, resource conservation,technological innovation, realizing its potential according to such policy and optimized allocation.The port comprehensive management capability of the Group sustained for years has marked a goodreputation in the industry.
4. Continuously optimized supply chain comprehensive service capability
The Company adheres to create values on the port-centered blockchain as well as the port-linkedlogistics chain.
With the objective of becoming a high-quality and world-class comprehensive port service provider,the Company keeps enhancing corporate value. Firstly, in respect of the advanced comprehensivedevelopment capability, taking port business as the core and leveraging the synergy of different portzones as well as city-industry integration, the Company explores the comprehensive port developmentmodel of “Port-Park-City”. Based on the traditional loading and discharging and ancillary services atports, it gradually established the comprehensive development model offering high value-added
services to enterprises. Currently, the Company has participated in promoting the comprehensive portdevelopment model of “Port-Park-City” in various overseas regions and has achieved remarkableresults and helped foster new profit growth points for the Company. Secondly, in respect of moderncomprehensive logistics service capability, in view that the shipping and port sectors gradually shiftedto form alliances, the Company is actively integrating its domestic and overseas port assets andcapitalises on its relatively complete global port network to provide customers with comprehensiveport logistics service solutions, forming its unique competitive strength based on resources such asmaritime logistics, land transportation, storage, logistics and trading from CMG.
5. Self-innovative intelligent port construction capability
The Company rises to the call of the industry, pushing for traditional industrial upgrading, and itsprogress sets the direction of intelligent port construction.
The Company sticks into the promotion of digitalization transformation, leads technologiesinnovation and industrial application by combining with new technology and development andreleases overall solutions for smart ports featuring CMPort’s characteristics. In terms of the coreproduction system between the port and the park, although the self-developed system of CMIT, ahigh-tech enterprise under the Company broke the monopoly of foreign suppliers, it still stresses theimportance of intensifying related scientific research, with strengths concentrated on new structureand intelligent upgrade of CTOS system. In terms of industrial network platform construction, wehave updated comprehensive service platform to 3.0 version, i.e., “CM ePort 3.0” which is based onglobal port network of the Company to provide the port shipping logistics industry with the one-stopport integrating services including intelligent logistics, intelligent port as well as intelligent financeand business. The construction of intelligent port ecology circle leverages such system for achievinginnovation of port business model. In terms of the construction of intelligent port, Mawan Smart Portof the Company taking a lead from traditional bulk terminals upgraded to 5G intelligent port thatintegrating 5G, Beidou system, artificial intelligence, automation and other scientific and intelligencetechnologies. It has greatly improved productivity, green degree and management level of the portand achieved good economic and social benefits. With the SMP as the main achievement, "Researchand Application of Comprehensive Smart Management Platform for Large Port Groups based on BigData Analysis" of CMPort was awarded the special prize of the 2023 Science and Technology Prizeof China Port and Harbors Association, playing a demonstration role in the industry.
IV. Core business analysis
1. Port business review
(1) Overview of port business
In 2023, the Company’s ports handled a total container throughput of 180.195 million TEUs, up
23.5% year-on-year, and a bulk cargo volume of 1,250 million tonnes, up 69.6% year-on-year, whichwas mainly thanks to the business volume of Ningbo Port included in the Company since October2022, contributing business increment of the Company with container throughput of 31.374 million
TEUs and bulk cargo throughput of 490 million TEUs in the year. For container business, theCompany’s ports in Mainland China handled a container throughput of 140.306 million TEUs,representing a year-on-year increase of 33.4%, and ports in Hong Kong and Taiwan regionscontributed a total container throughput of 5.825 million TEUs, representing a year-on-year decreaseof 15.5%, with the total container throughput handled by the Company’s overseas ports of 34.064million TEUs, representing a year-on-year increase of 0.6%. In terms of bulk cargo business, theCompany’s ports in Mainland China handled a bulk cargo volume of 1,248 million tonnes, up 70.0%year-on-year, with the bulk cargo volume handled by the Company’s overseas ports of 6.915 milliontonnes, up 25.2% year-on-year.
Table 3-1 Throughput of the Company and changes in 2023
Item
| Item | 2023 | 2022 | Changes |
| Container throughput (’0,000 TEU) | 18,019.5 | 14,594.8 | 23.5% |
| Among which: Mainland China | 14,030.6 | 10,517.4 | 33.4% |
Hong Kong and Taiwan
| Hong Kong and Taiwan | 582.5 | 689.7 | -15.5% |
Overseas
| Overseas | 3,406.4 | 3,387.7 | 0.6% |
| Bulk cargo volume (’0,000 tonnes) | 125,449.6 | 73,953.4 | 69.6% |
| Among which: Mainland China | 124,758.1 | 73,400.8 | 70.0% |
Overseas
| Overseas | 691.5 | 552.6 | 25.2% |
Note: 1. The statistics represents the total throughput of the holding subsidiaries, associates and jointventures of the Company; 2. On September 2022, the Company being a strategic investor hascompleted the subscription of 2021 non-public A share issuance of Ningbo Port, representing holding
23.08% equities of Ningbo Port in total and became the second largest shareholder of such company.As such, the Company has been including the business volume of Ningbo Port since October 2022.
(2) Operation condition of port business by region
Table 3-2 Container throughput of the Company and changes in 2023 (in’0,000 TEU)
| Region and port company | 2023 | 2022 | Changes | ||
| Pearl River Delta | Holding company | West Shenzhen Port Zone | 1,358.2 | 1,332.3 | 1.9% |
| Shunde New Port | 38.5 | 41.0 | -6.0% | ||
| Joint stock company | Chu Kong River Trade Terminal | 87.9 | 87.1 | 0.9% | |
| Yangtze River Delta | Joint stock company | SIPG Group | 4,915.8 | 4,730.0 | 3.9% |
| Joint stock company | Ningbo Zhoushan Port | 4,272.0 | 1,134.6 | 276.5% | |
Bohai Rim
| Bohai Rim | Joint stock company | Tianjin Port Container Terminal | 822.2 | 848.1 | -3.1% |
| QQCTU | 1,065.0 | 934.9 | 13.9% | ||
| Liaoning Port Co., Ltd. | 1,143.8 | 1,089.7 | 5.0% | ||
| South-East region | Holding company | Zhangzhou Port | 35.6 | 33.2 | 7.2% |
| Shantou Port | 164.4 | 163.0 | 0.9% | ||
| South-West region | Holding company | Zhanjiang Port | 127.1 | 123.4 | 3.0% |
Hong Kong andTaiwan
| Hong Kong and Taiwan | Holding company /Joint stock company | CMCS/Modern Terminals | 415.5 | 484.9 | -14.3% |
| Joint stock company | Taiwan Kao Ming Container | 167.0 | 204.8 | -18.5% | |
| Overseas | Holding company | CICT | 324.8 | 321.5 | 1.0% |
| TCP | 125.3 | 115.6 | 8.4% | ||
| LCT | 160.1 | 160.3 | -0.1% | ||
| Joint stock company | TL | 2,544.1 | 2,575.9 | -1.2% | |
| Kumport | 131.7 | 120.9 | 8.9% | ||
| PDSA | 88.7 | 63.5 | 39.7% | ||
| TICT | 31.7 | 30.0 | 5.7% | ||
| Total | 18,019.5 | 14,594.8 | 23.5% | ||
Note: On September 2022, the Company being a strategic investor has completed the subscription of2021 non-public A share issuance of Ningbo Port, representing holding 23.08% equities of NingboPort in total and became the second largest shareholder of such company. As such, the Company hasbeen including the business volume of Ningbo Port since October 2022.
Table 3-3 Bulk cargo volume handled by the Company and changes in 2023 (in’0,000 tonnes)
| Region and port company | 2023 | 2022 | Changes | ||
| Pearl River Delta | |||||
| Holding company | West Shenzhen Port Zone | 1,616.1 | 1,860.5 | -13.1% | |
| Dongguan Machong | 1,701.6 | 1,501.5 | 13.3% | ||
| Shunde New Port | 660.9 | 627.1 | 5.4% | ||
| Joint stock company | Chu Kong River Trade Terminal | 398.7 | 424.8 | -6.1% | |
Yangtze River
Delta
| Yangtze River Delta | Joint stock company | SIPG Group | 8,401.0 | 7,817.0 | 7.5% |
| Joint stock company | Ningbo Zhoushan Port | 64,533.0 | 15,094.0 | 327.5% |
Bohai Rim
| Bohai Rim | Joint stock company | QQTU | 1,392.2 | 1,363.8 | 2.1% |
| Qingdao Port Dongjiakou | 7,463.7 | 7,221.1 | 3.4% | ||
| Liaoning Port Co., Ltd. | 25,126.6 | 25,442.4 | -1.2% | ||
| Laizhou Harbour Affairs | 2,021.3 | 1,907.5 | 6.0% |
South-Eastregion
| South-East region | Holding company | Zhangzhou Port | 916.6 | 838.3 | 9.3% |
| Xia Men Bay Terminals | 619.6 | 607.5 | 2.0% | ||
| Shantou Port | 461.6 | 381.4 | 21.0% | ||
| South-West region | Holding company | Zhanjiang Port | 9,445.0 | 8,313.9 | 13.6% |
Overseas
| Overseas | Holding company | HIPG | 245.6 | 129.4 | 89.8% |
| Joint stock company | Kumport | 44.8 | 14.5 | 208.4% | |
| PDSA | 401.1 | 408.6 | -1.8% | ||
| Total | 125,449.6 | 73,953.4 | 69.6% | ||
Note: On September 2022, the Company being a strategic investor has completed the subscription of2021 non-public A share issuance of Ningbo Port, representing holding 23.08% equities of NingboPort in total and became the second largest shareholder of such company. As such, the Company hasbeen including the business volume of Ningbo Port since October 2022.
Pearl River Delta region
The West Shenzhen Port Zone handled a total of container throughput of 13.582 million TEUs, up
1.9% year-on-year, and a bulk cargo volume of 16.161 million tonnes, down 13.1% year-on-year,which was influenced by business structure adjustment in West Shenzhen Port Zone. Shunde NewPort handled a container throughput of 0.385 million TEUs, down 6.0% year-on-year, which wasmainly influenced by the supply and demand in the international shipping market with the lowerdemand for import and export from Europe and America; and a bulk cargo volume of 6.609 milliontonnes, up 5.4% year-on-year, mainly benefiting from the increase of steel volume driven by risingdemand from manufacturing enterprises. Dongguan Machong handled a bulk cargo volume of 17.016million tonnes, representing an increase of 13.3% year-on-year, mainly due to the expansion of grain-forage market. Chu Kong River Trade Terminal handled a total of container throughput of 0.879million TEUs, up 0.9% year-on-year, and a bulk cargo volume of 3.987 million tonnes, down 6.1%year-on-year.
Yangtze River Delta region
SIPG handled a container throughput of 49.158 million TEUs, up 3.9% year-on-year, and a bulk cargovolume of 84.01 million tonnes, up 7.5% year-on-year, mainly due to the lower base in the sameperiod last year. Ningbo Zhoushan Port handled a container throughput of 42.72 million TEUs, and abulk cargo volume of 645.33 million tonnes.
Bohai Rim region
QQCTU delivered a container throughput of 10.65 million TEUs, up 13.9% year-on-year, mainlybenefiting from the adjustment of business policies and more routes. QQTU delivered a bulk cargovolume of 13.922 million tonnes, up 2.1% year-on-year. Qingdao Port Dongjiakou handled a bulkcargo volume of 74.637 million tonnes, representing a year-on-year increase of 3.4%. Liaoning PortCo., Ltd. handled a container throughput of 11.438 million TEUs, up 5.0% year-on-year, mainlybenefiting from the recovery of vessels in the foreign trade routes; and a bulk cargo volume of 251.266million tonnes, down 1.2% year-on-year. Laizhou Harbour Affairs handled a container throughput of
20.213 million tonnes, representing a year-on-year increase of 6.0%, mainly benefiting from theexpansion of crude oil business. Tianjin Port Container Terminal handled a container throughput of
8.222 million TEUs, representing a year-on-year decrease of 3.1%.
South-East region
Zhangzhou Port handled a container throughput of 0.356 million TEUs, up 7.2% year-on-year, mainlybenefiting from sources expansion of weighted boxes in hinterland trade and increased routes andincrement brought by sea-rail joint transportation, and a bulk cargo volume of 9.166 million tonnes,up 9.3% year-on-year, which was mainly due to the supportive policies of food and wood business.Xia Men Bay Terminals handled a bulk cargo volume of 6.196 million tonnes, representing a year-on-year increase of 2.0%. Shantou Port handled a container throughput of 1.644 million TEUs, up
0.9% year-on-year, and a bulk cargo volume of 4.616 million tonnes, up 21.0% year-on-year, mainlybenefiting from business growth in coal import.
South-West region
Zhanjiang Port handled a container throughput of 1.271 million TEUs, up 3.0% year-on-year, and abulk cargo volume of 94.45 million tonnes, up 13.6% year-on-year, mainly benefiting from expansionof iron ore, coal and food business.
Hong Kong and Taiwan regions
CMCS and Modern Terminals in Hong Kong delivered a total of container throughput of 4.155million TEUs, representing a year-on-year decrease of 14.3%, which was influenced by annuallydecreased transfer business in Hong Kong and recovery of domestic supply business to Hong Kong.Kao Ming Container in Taiwan handled a total of container throughput of 1.67 million TEUs,representing a year-on-year decrease of 18.5%, mainly caused by decreased transfer business.
Overseas regions
In Sri Lanka, CICT handled a container throughput of 3.248 million TEUs, representing a year-on-year increase of 1.0%, which represents increased market share and unchanged competitive advantagein regional markets. HIPG handled bulk cargo volume of 2.456 million tonnes, up 89.8% year-on-year, mainly benefiting from expansion of oil and gas business; RO-RO volume handled by HIPG
was 0.7 million vehicles, up 25% year-on-year, consolidating its position as the regional transfercentre. TCP in Brazil handled a container throughput of 1.253 million TEUs, representing a year-on-year increase of 8.4%, mainly benefiting from further business structure optimization and increasedmarket shares of weighted boxes and refrigerators. LCT in Togo handled a container throughput of
1.601 million TEUs, representing a year-on-year decrease of 0.1%. TICT in Nigeria handled acontainer throughput of 0. 317 million TEUs, representing a year-on-year increase of 5.7%. Port deDjibouti S.A. (PDSA) in Djibouti handled a container throughput of 0.887 million TEUs, up 39.7%year-on-year, mainly benefiting from expansion of international transfer business, and a bulk cargovolume of 4.01 million TEUs, down by 1.8% year-on-year. In Turkey, Kumport handled a containerthroughput of 1.317 million TEUs, up 8.9% year-on-year, mainly benefiting from new-added airline,and a bulk cargo volume of 0.448 million tonnes, up 208.4% year-on-year, mainly benefiting fromincreasingly rising building materials exported. Terminal Link handled a container throughput of
25.441 million TEUs, representing a year-on-year decrease of 1.2%.
2. Implementation of business plan during the Reporting Period
During the Reporting Period, in face of the complicated and changing situation for global supplychain, the Company adhered to the general thrust of seeking progress while maintaining stability,continued to overcome challenges and record steady growth by focusing on “high-qualitydevelopment” and endogenous growth as well as innovation and upgrade, made breakthrough in“finely developing in Southeast Asia” and progress in lean operation as well as continuously brokethrough the bottlenecks of homebase ports, and achieved better performance with higher quality withrespect to construction of homebase ports, technological innovation, market expansion, operationmanagement, deepening reform, comprehensive development, ESG construction and other aspects.
(1) As for the construction of homebase ports, strengthening regional position and extendingvalue chain. The business volume of the West Shenzhen homebase port recorded a steady growth.The container business created a record high in its market share in foreign trade in the Guangdong-Hong Kong-Macao Greater Bay Area, representing a better performance than the overall level of theGuangdong-Hong Kong-Macao Greater Bay Area. In addition, the coordinated ports model in theGuangdong- Hong Kong-Macau Greater Bay Area has been promoted to other regions on an ongoingbasis. The Company efficiently propelled the development of the coordinated ports system coveringthe West Shenzhen Port Zone and the river ports in the Pearl River Delta region by integrating thefunctions of the blockchain platform of the coordinated port and the barge scheduling platform of thePearl River Delta region, which helped significantly streamline trade and logistics development inthe Greater Bay Area; With further consolidating the leading position of bulk cargo operations, theCompany continued to rank first in terms of its domestic market share of imported wheat, meals andcompound fertilizer. For Sri Lanka homebase port, the Company continued to promote theconstruction of the international shipping hubs in South Asia. CICT continued to optimize thestructure of shipping routes by focusing on local volume of containers and consolidating thefoundation and created a record high in terms of its market share of local containers; the Companycontinued to extend its industry chain and build a logistics ecosphere. With the official initiating oftrade and logistics project in South Asia, the Company made efforts to transform it into a new businessgrowth point. HIPG continued to strengthen its core competitiveness by enhancing its foundation of
RORO operations and actively exploring RORO value-added services, and also collaborated withSinopec in joint marketing of fuel oil , which contributed to a new breakthrough in refueling for mainchannel ships and a history high in the business volume of RORO vehicles and fuel oil.
(2) In terms of technological innovation, promoting digital innovation and constructing smartport. CMIT, a subsidiary of the Company, continued to increase investment in R&D of technologies,steadily implemented the critical task to implement the structural upgrade of the Container TerminalOperation System (CTOS) of Ministry of Transport, continued to optimize the proposal ofautonomous driving technology, sped up the R&D and promotion of products of comprehensiveservice platform of “CM ePort”, and constantly promoted management delegation of the SmartManagement Platform (SMP). In 2023, significant results were made in implementing the criticaltask of CTOS; “CM ePort” succeeded in entirely covering the domestic master terminals controlledby the Company to provide customers with one-stop intelligent services; The construction of database of CMPort, business process platform, data indicator platform and global monitoring center hasbeen finished on the “SMP” platform, and was comprehensively applied into the process managementand operation analysis of enterprises. The project won the first prize in the operation managementcategory of the first State-Owned Enterprise Digital Scene Professional Competition by SASAC andthe Special Award for Science and Technology Progress Award issued by the China Ports & HarboursAssociation in 2023.
(3) In terms of overseas expansion, implementing key projects and making breakthroughs inkey areas. In April 2023, an agreement on the South Asia Commercial and Logistics Hub in ColomboPort was officially signed. The project, with a total investment of US$392 million, is implemented byadopting the “Build-Operate-Transfer (BOT)” model, will provide a superior logistics andwarehousing facility, and will offer the full gamut of services such as container disassembling andloading, bonded warehousing, free port operations, warehouse leasing and harbour trade logistics.The project will not only significantly improve the logistics services there, but will also attract morebusiness and container volumes to Colombo Port, further strengthening the position of Colombo Portas an important hub in South Asia. In November 2023, China Merchants Port (a holding subsidiaryof the Company) acquired 51% of the shares of PT Nusantara Pelabuhan Handal Tbk (NPH) at aconsideration of approximately US$61.20 million and will become its controlling shareholder. NPHis a company listed on the Indonesia Stock Exchange and principally engaged in the provision ofcontainer, multipurpose and general terminal services and provision of engineering services for portequipment. It operates two container terminals at Jakarta Port, the largest port in Indonesia. Thisacquisition is a great progress for the Company to expand its business in Southeast Asia and willfurther enable the Company to share the dividends brought by the rapid development of the RCEPregion.
(4) In terms of operation management, facilitating intelligence-driven operation and deepeninglean management. By taking SMP as a starting point, the Company built a one-stop comprehensivemanagement platform of CMPort, supporting the business analysis of all modules, namely containers,bulk cargos, logistics park, comprehensive development and intelligent technology. SMP takes digitaltechnology as the key force and applies smart tools to drive the transformation of means, modes andconcepts of the operation and management of CMPort. At present, the Company has substantially
realized the classification and management of information of lifetime of assets, the standardizationand online presence of major business processes. Besides, the Company also optimizes theengineering management system and strengthens lifecycle management of major projects; optimizesits profitability and constantly developed measures to enhance its quality and efficiency; optimizesand reshapes its business and financial analysis framework to strictly control the increase of cost andexpenses; deepens cost control to form a normalization mechanism of cost reduction and higherefficiency. The streamline operation of the Company has achieved phased results.
(5) In terms of deepening reform, deeply implementing the “Double-Hundred Action” andstimulating Company vitality. The Company has deeply implemented the “Double-HundredAction”. By focusing on "improving the core competitiveness of the enterprise and enhancing corefunctions", the Company developed a reform implementation plan of the "Double Hundred Action"for CMPort (2023-2025) and working record, specifying the goals, tasks, timetable and road map inthe next round of reform. In 2023, the Company has achieved full coverage of tenure system andcontractual management, improved the market-oriented salary distribution mechanism, strengthenedthe performance salary dual benchmarking, and explored the construction of a diversified andinternational incentive system that combines short and medium term incentives, and supplementscash and equity incentives. In May 2023, SASAC of the State Council released the special appraisalresults of “Double-Hundred Enterprises” of 2022 and the Company received “Excellent” title for itsoutstanding achievements and remarkable reform results.
(6) In terms of comprehensive development, domestic parks advancing together and overseasparks developing against the trend. China Merchants Bonded has achieved effective utilization ofnew warehouses at a rate of over 95%. The export service platform for new energy vehicles hasperformed well. Qingdao Bonded has maintained a stable occupancy rate, and diversified self-operated business, achieving a doubled inbound logistics year-on-year. The Hambantota PortIndustrial Park has further explored the market, and realized a significant improvement on the qualityof customers. In 2023, 12 new customers have signed contracts to settle in the park, contributing to atotal of 51 companies settled in; the Djibouti International Free Trade Zone has signed contracts with351 companies, with container yard fully occupied and warehouse occupied over 96%.
(7) In terms of ESG construction, actively implementing the ESG concept and having wonmultiple awards. In 2023, under the guidance of the ESG strategic plan, the Company furtherimproved the comprehensive ESG management system, compiled an ESG work manual andpromoted the ESG upgrade of overseas projects. By focusing on main port business and industrypriorities, the Company fully leveraged its sufficient resources to promote more distinctive ESGpractices. The Company has been selected into the "China ESG Listed Companies First 100" list and"China Top 100 ESG Listed Companies", and has also been included in the "CSI Securities TimesESG Top 100 Index". In 2023, the MSCI rating of China Merchants Port (the Company's holdingsubsidiary), was upgraded by two levels from "CCC" to "BB".
3. Revenue and Cost Analysis
(1) Breakdown of Operating Revenue
Unit: RMB
| 2023 | 2022 | Change (%) | |||
| Operating revenue | As % of total operating revenue (%) | Operating revenue | As % of total operating revenue (%) | ||
| Total | 15,750,475,780.22 | 16,230,489,127.55 | -2.96% | ||
| By operating division | |||||
| Port operations | 15,036,273,586.66 | 95.47% | 15,626,802,064.84 | 96.28% | -3.78% |
| Bonded logistics service | 532,670,444.04 | 3.38% | 445,592,537.09 | 2.75% | 19.54% |
| Property development and investment | 181,531,749.52 | 1.15% | 158,094,525.62 | 0.97% | 14.82% |
| By operating segment | |||||
| Mainland China, Hong Kong and Taiwan | 10,958,608,605.93 | 69.58% | 12,105,380,701.20 | 74.58% | -9.47% |
| Other countries and regions | 4,791,867,174.29 | 30.42% | 4,125,108,426.35 | 25.42% | 16.16% |
(2) Operating Division, Product Category, Operating Segment or Sales Model Contributingover 10% of Operating Revenue or Operating Profit
Unit: RMB
| Operating revenue | Cost of sales | Gross profit margin | YoY change in operating revenue (%) | YoY change in cost of sales (%) | YoY change in gross profit margin (%) | |
| By operating division | ||||||
| Port operations | 15,036,273,586.66 | 8,796,081,230.13 | 41.50% | -3.78% | -3.90% | 0.08% |
| By operating segment | ||||||
| Mainland China, Hong Kong and Taiwan | 10,958,608,605.93 | 7,201,809,031.78 | 34.28% | -9.47% | -7.22% | -1.60% |
| Other countries and regions | 4,791,867,174.29 | 2,116,377,675.97 | 55.83% | 16.16% | 12.09% | 1.60% |
Core business data of the prior year restated according to the changed statistical caliber for theReporting Period:
□ Applicable √ Not applicable
(3) Whether Revenue from Physical Sales Is Higher than Service Revenue
□ Yes √ No
(4) Execution Progress of Major Signed Sales and Purchase Contracts in the Reporting Period
□ Applicable √ Not applicable
(5) Breakdown of Cost of Sales
Unit: RMB
Operatingdivision
| Operating division | Item | 2023 | 2022 | Change (%) | ||
| Cost of sales | As % of total cost of sales (%) | Cost of sales | As % of total cost of sales (%) | |||
| Port operations | Loading and unloading services | 8,796,081,230.13 | 94.40% | 9,153,516,391.90 | 94.85% | -3.90% |
| Bonded logistics service | Logistics service | 289,816,313.93 | 3.11% | 280,270,213.56 | 2.90% | 3.41% |
| Other | Properties | 232,289,163.69 | 2.49% | 216,675,107.48 | 2.25% | 7.21% |
(6) Changes in the Scope of Consolidated Financial Statements for the Reporting Period
√ Yes □ No
On 8 August 2023, the transfer of 45% equity interest in Ningbo Daxie China Merchants InternationalTerminals Co., Ltd. (hereinafter referred to as “Ningbo Daxie”) by the Company’s subsidiary CyberChic Company Limited through public tender was completed. The Company no longer holds equityinterests in Ningbo Daxie, which is thus no longer a subsidiary within the scope of the Company'sconsolidated financial statements.The Company’s subsidiary China Merchants International Technology Co., Ltd. (hereinafter referredto as “CMIT”) transferred 100% equity interests in Yingkou Port Information Technology Co., Ltd.(hereinafter referred to as “YPIT”) and 79.03% equity interests in Dalian Port Logistics Network Co.,Ltd. (hereinafter referred to as “DPN”) to Liaoning Port Co., Ltd. (hereinafter referred to as “Liaoning
Port”). YPIT and DPN completed the alteration of their registered information with the competentindustrial and commercial administration in association with the aforesaid transaction in November2023. As such, YPIT and DPN are no longer subsidiaries within the scope of the Company'sconsolidated financial statements.
(7) Major Changes to the Business Scope or Product or Service Range in the Reporting Period
□ Applicable √ Not applicable
(8) Major Customers and Suppliers
Major customers:
Total sales to top five customers (RMB)
| Total sales to top five customers (RMB) | 4,223,089,383.16 |
| Total sales to top five customers as % of total sales of the Reporting Period (%) | 26.81% |
| Total sales to related parties among top five customers as % of total sales of the Reporting Period (%) | 0.00% |
Top five customers:
| No. | Customer | Sales revenue contributed for the Reporting Period (RMB) | As % of total sales revenue (%) |
| 1 | Customer A | 2,007,111,746.88 | 12.74% |
| 2 | Customer B | 754,791,701.68 | 4.79% |
| 3 | Customer C | 737,970,284.02 | 4.69% |
| 4 | Customer D | 396,722,960.42 | 2.52% |
| 5 | Customer E | 326,492,690.16 | 2.07% |
| Total | -- | 4,223,089,383.16 | 26.81% |
Other information about major customers:
□ Applicable √ Not applicable
Major suppliers:
| Total purchases from top five suppliers (RMB) | 789,890,887.34 |
| Total purchases from top five suppliers as % of total purchases of the Reporting Period (%) | 12.33% |
| Total purchases from related parties among top five suppliers as % of total purchases of the Reporting Period (%) | 0.00% |
Top five suppliers:
| No. | Supplier | Purchase in the Reporting Period (RMB) | As % of total purchases (%) |
| 1 | Supplier A | 329,518,663.16 | 5.14% |
| 2 | Supplier B | 141,671,251.97 | 2.21% |
| 3 | Supplier C | 139,554,424.91 | 2.18% |
| 4 | Supplier D | 96,633,378.98 | 1.51% |
| 5 | Supplier E | 82,513,168.32 | 1.29% |
| Total | -- | 789,890,887.34 | 12.33% |
Other information about major suppliers:
□ Applicable √ Not applicable
4. Expense
Unit: RMB
| 2023 | 2022 | Change (%) | Reason for any significant change | |
| Administrative expense | 1,776,641,155.38 | 1,765,094,736.51 | 0.65% | - |
| Finance costs | 1,839,113,328.14 | 2,258,713,672.42 | -18.58% | Mainly due to the impact of exchange rate changes, the net exchange loss caused by foreign exchange adjustment decreased year-on-year |
| R&D expense | 223,739,072.07 | 287,706,178.70 | -22.23% | Mainly due to the decrease in R&D expenditure this year |
5. R&D Investments
| Main R&D project | Project purpose | Project progress | Objective to be achieved | Expected impact on the Company |
| Project for developing the core technology in TOS for automated container terminal | Develop a new generation of automated production management system for container terminal, that is controlled in an integrated, intelligent and coordinated manner, applicable to traditional container terminals. Adopt multi-platform, | It is now under development. | Comprehensively create a new generation of CTOS product based on microservice architecture driven by big data, with the focus on the digitalised and intelligent upgrading of traditional container terminals. | Have standardised product functions with external applications designed with more plugins. Meet customer needs at a low cost and be more efficient in replication and promotion. |
distributed andmicroservicearchitecture, drivenby big data, anddevelop corealgorithms andmakebreakthroughsbased on AItechnology andoperationsoptimisationtechnology, toreshape theintelligentintegrated operationand control modeand technologysystem of containerterminals.
| distributed and microservice architecture, driven by big data, and develop core algorithms and make breakthroughs based on AI technology and operations optimisation technology, to reshape the intelligent integrated operation and control mode and technology system of container terminals. | ||||
| Intelligent bulk cargo wharves | It aims to address the difficulties of the production organization and intelligent management of the bulk cargo wharves and focus on efficiency improvement, cost control, security guarantee, standardized management, and environmental protection to drive sustainable and green development of the port. | It has been put into operation and will be improved on an on-going basis. | Its objective is to realize routine dual-flow loading, unloading, and mixing, significantly improve loading capacity while improving the capabilities of the wharves and mixing operation, and reduce wharf operating personnel. | The implementation capacity can be driven to improve and a green port can be constructed through technical transformation, thus creating intelligent bulk cargo wharves. |
| R&D of the CM ePort V3.0 product | As the port business handling platform for external customers of each port of the CM Port Group, it aims to maximumly realize the online processing of offline business processes of the port’s customers. | It has been applied to nine wharves. | Its objective is to realize the online operation of the ship service module, documentation service module, container service module, bulk cargo service module, commercial service module, regulation service module, inquiry services, and customer services. | The dispersive customer service demands of each wharf will be integrated to become the unified external customer service portal of the CM Port Group. |
| Energy and carbon management platform | The professional management system is used for accurate collection and refined | It has been released. | Build eight major business modules, including comprehensive cockpit, enterprise information | Manage and monitor carbon emissions more effectively, facilitating the adoption of appropriate energy- |
management ofenergyconsumption dataof subordinate unitsunder CM PortGroup, whichempowers it toenhance theeffectiveness ofenergy and carbonmanagementthrough statistics,measurement andanalysis on carbonemissions.
| management of energy consumption data of subordinate units under CM Port Group, which empowers it to enhance the effectiveness of energy and carbon management through statistics, measurement and analysis on carbon emissions. | management, data collection, energy and carbon analysis, early warning center, knowledge center, project management and control, and back-office management. Roll out functions such as remote docking of electrical energy data and one-button push of the Group’s energy saving and environmental protection management system. | saving and emission reduction measures. Be able to follow progress in the implementation of emission reduction projects. Perform environmental protection responsibility to promote sustainable development. | ||
| R&D project for unmanned driving dispatch system supporting mixed traffic | Develop the solution of autonomous driving system at the terminal, and dispatch the fleet to ensure the mixed traffic of automatic driving vehicles and manned vehicles. | It is now under development. | Build a set of scheduling and management system for unmanned container truck fleet, where the existing production system CTOS at the terminal can connect with unmanned trucks, to manage the unmanned truck fleet in a unified manner and conduct the horizontal automated transportation within the port area. | Enrich the functions of CTOS products to enhance the support for terminals in horizontal automated transportation scenario and significantly improve the intelligent level and core competitiveness of such products. Support both the upgrading of traditional terminals and the production and operation of fully automated terminals in terms of horizontal transportation automation. |
| Function enhancement of the intelligent whole-field dispatching module of tractors | Based on the Mawan Smart Port system, it aims to utilize such technologies as AI, 5G, Beidou positioning, and digital twin technology to dispatch tractors within the whole field of the three ports of West Shenzhen to improve tractor efficiency. | It is now under development and fine-tuning. | Its objective is to visualize the positions of all tractors at the port in the transportation process and optimize and improve the efficiency of tractors in West Shenzhen ports. | It will improve the overall efficiency of tractors in West Shenzhen ports as well as the safe production environment, save energy, reduce carbon emissions, and reduce the cost of a single container. |
| Visual security information platform of the South China | Make port facility security more intelligent, build the framework of digital security | It is now under development. | Facilitate the digital upgrading of port security through information technology and provide more | Build digitalised port security to support heavy and complex security work by strengthening security |
ManagementCenter
| Management Center | management information platform, and integrate various security modules. Provide interfaces for later interconnection with managing units to realize data sharing for safety supervision and real-time management of internal safety information. | comprehensive, accurate and real-time security management information. | monitoring and standardizing security business operation procedures. | |
| Customs clearance project for the Greater Bay Area Blockchain | It aims to connect all customs offices in the Greater Bay Area, achieve mutual connectivity, mutual trust and mutual recognition among customs areas, and realize dynamic and real-time monitoring of goods declaration, release, inspection and arrival and departure at hub ports. | It is now under customized development, optimization and expansion. | Its objective is to establish core port logistics data standards and platforms with blockchain network technology as the basis of scientific and technological innovation to simplify the cargo clearance procedures, enhance the comprehensive competitive strength of ports, and realize the innovation of supervision technology and mode. | It will facilitate the expansion of waterway transport transfer business in the Guangdong-Hong Kong-Macao Greater Bay Area, improve the dominant role and core competitiveness of Shenzhen Western Port Area in the market, innovate the technology application of smart port scenarios, extend and expand intelligent financial services, and contribute to the sustainable and healthy development of intelligent port new ecology. |
Details about R&D personnel:
| 2023 | 2022 | Change (%) | |
| Number of R&D personnel | 758 | 1,028 | -26.26% |
| R&D personnel as % of total employees | 5.52% | 6.51% | -0.99% |
| Education background | —— | —— | —— |
| Bachelor’s degree | 431 | 665 | -35.19% |
| Master’s degree | 51 | 73 | -30.14% |
| Doctoral degree | 2 | 2 | 0% |
| Others | 274 | 288 | -4.86% |
| Age structure | —— | —— | —— |
| Below 30 | 182 | 209 | -12.92% |
| 30~40 | 312 | 401 | -22.19% |
| Over 40 | 264 | 418 | -36.84% |
Note: The data of R&D personnel from 2022 will be counted according to the index definition of Ministry ofTransport.Details about R&D investments:
| 2023 | 2022 | Change (%) | |
| R&D investments (RMB) | 243,835,440.24 | 295,509,765.04 | -17.49% |
| R&D investments as % of operating revenue | 1.55% | 1.82% | -0.27% |
| Capitalized R&D investments (RMB) | 54,083,098.04 | 38,808,729.08 | 39.36% |
| Capitalized R&D investments as % of total R&D investments | 22.18% | 13.13% | 9.05% |
Reasons for any significant change to the composition of the R&D personnel and the impact:
Affected by the transfer of Ningbo Daxie and the split of CMIT, the number of R&D personnel of thecompany declined in 2023. Excluding the above factors, the number of R&D personnel of thecompany will be 618 in 2022, an increase of 22.65% in 2023.Reasons for any significant YoY change in the percentage of R&D investments in operating revenue:
□ Applicable √ Not applicable
Reason for any sharp variation in the percentage of capitalized R&D investments and rationale:
□ Applicable √ Not applicable
6. Cash Flows
Unit: RMB
| Item | 2023 | 2022 | Change (%) |
| Subtotal of cash generated from operating activities | 17,000,495,102.94 | 17,929,072,211.60 | -5.18% |
| Subtotal of cash used in operating activities | 10,420,888,467.77 | 11,008,694,821.25 | -5.34% |
| Net cash generated from/used in operating activities | 6,579,606,635.17 | 6,920,377,390.35 | -4.92% |
| Subtotal of cash generated from investing activities | 35,753,871,407.49 | 43,633,757,210.28 | -18.06% |
| Subtotal of cash used in investing activities | 31,986,686,794.41 | 57,597,705,841.12 | -44.47% |
Net cash generatedfrom/used in investingactivities
| Net cash generated from/used in investing activities | 3,767,184,613.08 | -13,963,948,630.84 | 126.98% |
| Subtotal of cash generated from financing activities | 35,969,147,411.79 | 59,806,176,788.35 | -39.86% |
| Subtotal of cash used in financing activities | 43,953,840,588.20 | 52,289,938,319.06 | -15.94% |
| Net cash generated from/used in financing activities | -7,984,693,176.41 | 7,516,238,469.29 | -206.23% |
| Net increase in cash and cash equivalents | 2,451,304,159.48 | 839,954,233.26 | 191.84% |
Explanation of why any of the data above varies significantly on a year-on-year basis:
Cash used in investing activities declined 44.47% year-on-year, primarily driven by the decreasedequity investments and structured deposits purchases.Net cash generated from investing activities rose 126.98% year-on-year, primarily driven by a biggerreduction in cash used in investing activities than in cash generated from investing activities.Cash generated from financing activities declined 39.86% year-on-year, primarily driven by thereceipt of funds raised through a private placement of A-stock shares last year, with no comparablefund raising activities in the current year.Net cash generated from financing activities declined 206.23% year-on-year, primarily driven by alarger reduction in cash generated from financing activities than in cash used in financing activities.The net increase in cash and cash equivalents increased 191.84% year-on-year, mainly driven by thecombined impact of operating, financing and investing cash flows.Explanation of why net cash generated from/used in operating activities varies significantly from netprofit of the Reporting Period:
□ Applicable √ Not applicable
V Analysis of Non-main Businesses
Unit: RMB
| Amount | As % of total profit | Main source/reason | Recurrent or not |
Investmentincome
| Investment income | 6,348,676,940.80 | 72.15% | Income from investments in associates and joint ventures, which were mainly due to the net profit of Shanghai Port this year | Yes |
| Change in fair value gain or loss | 73,352,800.52 | 0.83% | - | Not |
| Asset impairment | -191,297,311.28 | -2.17% | Mainly due to the provision of asset impairment losses | Not |
| Non-operating income | 87,302,024.12 | 0.99% | - | Not |
| Non-operating expense | 97,072,840.72 | 1.10% | - | Not |
| Other income | 224,389,260.77 | 2.55% | Mainly due to obtain government subsidies | Not |
| Gain/loss on disposal of assets | 36,759,532.61 | 0.42% | - | Not |
VI Analysis of Assets and Liabilities
1. Significant Changes in Asset Composition
Unit: RMB
| 31 December 2023 | 1 January 2023 | Change in percentage (%) | Main reason for any significant change | |||
| Amount | As % of total assets | Amount | As % of total assets | |||
| Monetary assets | 16,079,646,178.24 | 8.10% | 13,615,928,739.40 | 6.89% | 1.21% | Changes in expenditures on operating, investing and financing activities |
| Accounts receivable | 1,103,901,466.25 | 0.56% | 1,276,149,689.44 | 0.65% | -0.09% | Deconsolidation of CMICT and enhanced collection of payments |
| Inventory | 218,898,192.87 | 0.11% | 225,122,821.48 | 0.11% | 0.00% | - |
| Investment real estate | 4,958,374,968.79 | 2.50% | 5,123,690,119.56 | 2.59% | -0.09% | - |
| Long-term equity investment | 96,666,117,776.27 | 48.68% | 92,364,293,919.05 | 46.75% | 1.93% | The swift to the equity method for the measurement |
of theinvestment inAntongHoldings, aswell as shareof profits anddividendsfrom investeeenterprises
| of the investment in Antong Holdings, as well as share of profits and dividends from investee enterprises | ||||||
| Fixed assets | 28,986,538,326.35 | 14.60% | 32,033,326,083.50 | 16.21% | -1.61% | Deconsolidation of CMICT and the provision for depreciation |
| Projects under construction | 2,909,817,281.46 | 1.47% | 2,413,844,407.64 | 1.22% | 0.25% | Increased engineering inputs |
| Right assets | 9,441,668,311.22 | 4.76% | 9,342,642,222.33 | 4.73% | 0.03% | - |
| Short-term borrowings | 15,714,045,288.97 | 7.91% | 7,164,338,366.18 | 3.63% | 4.28% | Increased short-term borrowings |
| Contract liability | 142,080,101.00 | 0.07% | 141,899,551.03 | 0.07% | 0.00% | - |
| Long-term payables | 18,227,543,954.71 | 9.18% | 12,390,099,177.85 | 6.27% | 2.91% | Increased long-term borrowings |
| Lease liability | 1,001,172,206.92 | 0.50% | 948,350,914.04 | 0.48% | 0.02% | - |
| Held-for-trading financial assets | 4,568,806,108.84 | 2.30% | 2,998,781,599.63 | 1.52% | 0.78% | Changes in structured deposits |
| Notes receivable | 325,150,195.09 | 0.16% | 36,395,000.00 | 0.02% | 0.14% | Increased bank acceptance bills |
| Non-current assets due within one year | 17,451,380.98 | 0.01% | 902,225,293.93 | 0.46% | -0.45% | Renewal of PON shareholder advance due within one year, which was transferred to long-term receivables |
| Long-term receivables | 3,856,466,116.99 | 1.94% | 5,661,327,499.07 | 2.87% | -0.93% | Recovery of TL shareholder loan and Renewal of PON shareholder advance |
Other non-currentfinancialassets
| Other non-current financial assets | 877,576,442.83 | 0.44% | 1,745,740,896.41 | 0.88% | -0.44% | The swift to the equity method for the measurement of the investment in Antong Holdings |
| Non-current liabilities due within one year | 6,817,404,289.25 | 3.43% | 11,641,223,688.95 | 5.89% | -2.46% | Decreased bonds payable due within one year |
| Other current liabilities | 2,143,842,534.53 | 1.08% | 3,161,147,525.96 | 1.60% | -0.52% | Decreased super-short-term financings |
Indicate whether overseas assets account for a high proportion of total assets.
√ Applicable □ Not applicable
| Asset | Source | Asset value (RMB’0,000) | Location | Operations | Control measures to protect asset safety | Return generated (RMB’0,000) | As % of the Company’s net asset value | Material impairment risk (yes/no) |
| Equity assets | Acquired via share offering | 15,123,090.34 | Hong Kong | Port investment and operations | Appointing director, supervisor and senior management /According to the political, economic and legal environment of different countries and regions, establish a targeted internal control system and early warning system. | 646,669.76 | 83.59% | No |
| Other information | N/A | |||||||
2. Assets and Liabilities at Fair Value
Unit: RMB
Item
| Item | Beginning amount | Gain/loss on fair-value changes in the Reporting Period | Cumulative fair-value changes through equity | Impairment allowance made in the Reporting Period | Purchased in the Reporting Period | Sold in the Reporting Period | Other changes | Ending amount |
| Financial assets | ||||||||
| Held-for-trading financial assets (exclusive of derivative financial assets) | 2,998,781,599.63 | 49,197,662.35 | - | - | 29,767,450,209.48 | 28,197,763,397.26 | -48,859,965.36 | 4,568,806,108.84 |
| Other non-current financial assets | 1,745,740,896.41 | 24,155,138.17 | - | - | - | 2,000,000.00 | -890,319,591.75 | 877,576,442.83 |
| Other equity instrument investment | 171,945,275.02 | - | 3,205,467.88 | - | - | - | -17,689,094.74 | 157,461,648.16 |
| Subtotal of financial assets | 4,916,467,771.06 | 73,352,800.52 | 3,205,467.88 | - | 29,767,450,209.48 | 28,199,763,397.26 | -956,868,651.85 | 5,603,844,199.83 |
Receivablesfinancing
| Receivables financing | 163,766,913.10 | - | - | - | - | - | -161,765,243.64 | 2,001,669.46 |
| Total of the above | 5,080,234,684.16 | 73,352,800.52 | 3,205,467.88 | - | 29,767,450,209.48 | 28,199,763,397.26 | -1,118,633,895.49 | 5,605,845,869.29 |
| Financial liabilities | - | - | - | - | - | - | - | - |
Details of other changes:
Other changes in trading financial assets were mainly due to changes in structured deposits.The main reasons for other changes in investments in other equity instruments were due to thedisposal of Ningbo Daxie.Other changes in other non-current financial assets were primarily attributable to the transfer ofequity investments in Antong Holdings to long-term equity investment in associates.Other changes in receivables financing are primarily attributable to changes in receivablesfinancing.
Significant changes to the measurement attributes of the major assets in the Reporting Period:
□ Yes √ No
3. Restricted Asset Rights as at the Period-End
The restricted monetary assets were RMB46,535,456.14 of security deposits and the frozen funds.The carrying value of fixed assets as collateral for bank loans was RMB291,001,239.59.The carrying value of intangible assets as collateral for bank loans was RMB457,654,685.65.VII Investments Made
1. Total Investment Amount
| Investment Amount in 2023 (RMB) | Investment Amount in 2022 (RMB) | Change (%) |
| 1,935,029,905.71 | 19,688,903,358.82 | -90.17% |
2. Major Equity Investments Made in the Reporting Period
□ Applicable √ Not applicable
3. Major Non-Equity Investments Ongoing in the Reporting Period
□ Applicable √ Not applicable
4. Financial Investments
(1) Securities Investments
Unit: RMB
Varietyofsecurities
| Variety of securities | Code of securities | Name of securities | Initial investment cost | Accounting measurement model | Beginning carrying value | Gain/loss on fair value changes in the Reporting Period | Cumulative fair value changes recorded into equity | Purchased in the Reporting Period | Sold in the Reporting Period | Gain/loss in the Reporting Period | Ending carrying value | Accounting item | Funding source |
| Stock | 6198 | Qingdao Port | 124,405,138.80 | Fair value method | 139,233,775.66 | 16,703,109.95 | - | - | - | 11,040,295.43 | 158,062,729.23 | Other non-current financial assets | Own funds |
| Stock | 601298 | Qingdao Port | 331,404,250.30 | Fair value method | 628,320,000.00 | 63,840,000.00 | - | - | - | 30,161,600.00 | 692,160,000.00 | Other non-current financial assets | Own funds |
Stock
| Stock | 400032 | Petrochemical A1 | 3,500,000.00 | Fair value method | 382,200.00 | - | - | - | - | - | 382,200.00 | Other equity instrument investment | Own funds |
| Stock | 400009 | Guang Jian 1 | 27,500.00 | Fair value method | 17,000.00 | - | - | - | - | - | 17,000.00 | Other equity instrument investment | Own funds |
| Stock | 600179 | Antong Holdings | 391,956.73 | Fair value method | 950,457,051.17 | -57,896,503.19 | - | - | - | - | - | Note | Own funds |
| Total | 459,728,845.83 | -- | 1,718,410,026.83 | 22,646,606.76 | 0.00 | 0.00 | 0.00 | 41,201,895.43 | 850,621,929.23 | -- | -- | ||
Note: As at 31 December 2023, the Company and a subsidiary of the Company, Zhanjiang ZhongliOcean Shipping Tallying Co., LTD., held a combined 6.83% equity interest in Antong Holdings andassigned one director to Antong Holdings, thus the Company had a significant influence on AntongHoldings and its equity investment in Antong Holdings was changed from other non-currentfinancial assets to long-term equity investment in associates.
(2) Investments in Derivative Financial Instruments
□ Applicable √ Not applicable
5. Use of Funds Raised
(1) Overall Usage of Funds Raised
Unit: RMB’0,000
Year
| Year | Way of raising | Total funds raised | Net proceeds | Total funds used in the Current Period | Accumulative fund used | Total funds with usage changed | Accumulative funds with usage changed | Proportion of accumulative funds with usage changed | Total unused funds | The usage and destination of unused funds | Amount of funds raised idle for over two years |
| 2022 | Private placement | 1,066,912.64 | 1,063,253.33 | 852,717.05 | 2,313,092.05 | 0 | 0 | 0% | 0 | -- | 0 |
| Total | -- | 1,066,912.64 | 1,063,253.33 | 852,717.05 | 2,313,092.05 | 0.00 | 0 | - | 0 | -- | 0 |
| Explanation of overall usage of funds raised | |||||||||||
| Pursuant to the Reply of China Securities Regulatory Commission on the Approval of the Private Placement of China Merchants Port Group Co., Ltd. (ZJXK [2022] No. 1657), the Company issued, in a private placement, a total of 576,709,537 shares of RMB-denominated ordinary shares (A-shares) to specified investors at a fixed price of RMB18.50/share, raising a total of RMB10,669,126,434.50, with the net amount after deducting issuance costs (exclusive of tax) being RMB10,632,533,330.40. The actual amount deposited in the raised funds account was RMB10,642,126,434.50 (inclusive of to-be-deducted other issuance costs of RMB9,593,104.10. Following the arrival of the aforesaid funds on 15 September 2022, Deloitte Touche Tohmatsu Certified Public Accountants LLP verified the funds raised in the private placement on 16 September 2022 and issued a Capital Verification Report (DSB (Y) Z (22) No. 00471). As of 31 December 2023, a total of RMB23,130,920,541.98 of raised funds had been used, including: (1) RMB10,727,170,541.98 used after the arrival of the raised funds, including RMB7,600,000,000.00 for supplementing working capital and repaying debts in 2022 and RMB3,127,170,541.98 for supplementing working capital and repaying debts in 2023; (2) RMB3,750,000.00 for paying issuance costs; (3) RMB7,800,000,000.00 for purchasing structured deposits (2022: RMB4,900,000,000.00; 2023: RMB2,900,000,000.00); (4) RMB500,000,000.00 for purchasing seven days call deposits (2022: RMB200,000,000.00; 2023: RMB300,000,000.00); (5) RMB4,100,000,000.00 for purchasing term deposits (2022: RMB1,900,000,000.00; 2023: RMB2,200,000,000.00). As of 31 December 2023, the interest income in the account of raised funds minus service charges stood at RMB24,371,574.15 (2022: RMB17,445,775.40; 2023: RMB6,925,798.75); the amount of structured deposits redeemed was RMB7,800,000,000.00 (2022: RMB4,100,000,000.00; 2023: RMB3,700,000,000.00); the amount of income from structured deposits was RMB31,427,525.11 (2022: RMB10,056,182.64; 2023: RMB21,371,342.47); the amount of term deposits redeemed was RMB4,100,000,000.00 (2023: RMB4,100,000,000.00); the amount of income from term deposits was RMB28,079,452.66 (2023: RMB28,079,452.66); the amount of seven days call deposits redeemed was RMB500,000,000.00 (2023: RMB500,000,000.00); and the amount of income from seven days call deposits was RMB4,915,555.56 (2023: RMB4,915,555.56). As of 31 December 2023, the raised funds had been used up, and the balance in the account of raised funds was nil. So far, the account of raised funds has been cancelled. | |||||||||||
(2) Commitment Projects of Fund Raised
Unit: RMB’0,000
| Committed investment project and super raise fund arrangement | Changed or not (including partial changes) | Committed investment amount | Investment amount after adjustment (1) | Investment amount in the Reporting Period | Accumulative investment amount as of the period-end (2) | Investment schedule as the period-end (3)＝(2)/(1) | Date of reaching intended use of the project | Realized income in the Reporting Period | Whether reached anticipated income | Whether occurred significant changes in project feasibility |
| Committed investment project | ||||||||||
Replenishing workingcapital andrepayingdebt
| Replenishing working capital and repaying debt | No | 1,063,253.33 | 1,063,253.33 | 312,717.05 | 1,072,717.05 | 100.89% | - | N/A | N/A | N/A |
| Subtotal of committed investment project | -- | 1,063,253.33 | 1,063,253.33 | 312,717.05 | 1,072,717.05 | -- | -- | N/A | -- | -- |
| Super raise fund arrangement | ||||||||||
| N/A | ||||||||||
| Subtotal of super raise fund arrangement | -- | - | - | - | - | -- | -- | 0 | -- | -- |
| Total | -- | 1,063,253.33 | 1,063,253.33 | 312,717.05 | 1,072,717.05 | -- | -- | N/A | -- | -- |
| Condition and reason for not reaching the schedule and anticipated income (by specific items) | N/A | |||||||||
| Notes of condition of significant changes occurred in project feasibility | N/A | |||||||||
| Amount, usage and schedule of super raise fund | N/A | |||||||||
| Changes in implementation address of investment project | N/A | |||||||||
| Adjustment of implementation mode of investment project | N/A | |||||||||
| Upfront investment and transfer of investment project | N/A | |||||||||
| Use of idle raised funds for cash management purposes | On September 29, 2022, the Company held the 7th Temporary meeting of the 10th Board of Directors in 2022 and the 4th Temporary meeting of the 10th Board of Supervisors in 2022, deliberating and passing the Motion on Using Idle Raised Funds for Cash Management, and agreed that the Company would use idle raised funds with a total amount not exceeding RMB10 billion for cash management. The funds in the above quota can be used on a rolling basis, and the quota is valid for 12 months from the date of the approval of the proposal by the Board of Directors of the Company, and the idle cash management of the raised funds will be returned to the raised funds account after the expiration. As of December 31, 2023, the Company used temporarily idle raised funds to purchase structured deposits of RMB7.8 billion, of which: RMB4.9 billion in 2022 and RMB2.9 billion in 2023; Purchase a seven-day notice deposit of RMB500 million, including RMB200 million in 2022 and RMB300 million in 2023; Purchased time deposits of RMB4.1 billion, including RMB1.9 billion in 2022 and RMB2.2 billion in 2023. The aforementioned structured deposits, seven-day notice deposits and time deposits have all been redeemed. During the year, cash management generated revenue of RMB54.3664 million. | |||||||||
| Amount of surplus in project implementation and the reasons | Income from wealth management and interest income | |||||||||
Usage anddestinationof unusedfunds
| Usage and destination of unused funds | N/A (account cancelled) |
| Problems incurred in fund using and disclosure or other condition | N/A |
(3) Re-purposed Raised Funds
□ Applicable √ Not applicable
The company did not change the project of raising funds in the Reporting Period.VIII Sale of Major Assets and Equity Investments
1. Sale of Major Assets
□ Applicable √ Not applicable
No such cases in the Reporting Period.
2. Sale of Major Equity Investments
| Transaction party | Equity investment sold | Date of sale | Transaction price (RMB’0,000) | Net profit contributed to the Company from the period-begin to the date of sale (RMB’0,000) | Effect on the Company | Ratio of the net profit contributed by the sale of the equity investment to the Company’s total profit (%) | Pricing principle | Related-party transaction or not | Relationship between the transaction party and the Company | Equity investment involved has been all transferred or not | Executed as scheduled or not; if not, give reasons and measures taken | Disclosure date | Index to disclosed information |
| Ningbo Zhoushan Port Company Limited | 45% equity interests in Ningbo Daxie China Merchants Internationa | 8 August 2023 | 1,845,000,000 | Effective utilisation of asset resources, realisation of asset | Through public tender | No | N/A | Yes | Yes | 22 March 2023 | Announcement No. 2023-021 on the Transfer of 45% Equity Interest in Ningbo |
lContainerTerminalCo.,Ltd.
| l Container Terminal Co., Ltd. | value and optimisation of geographical locations | Daxie China Merchants International Terminals Co., Ltd. by a Majority-owned Subsidiary through Public Tender, Announcement No. 2023-046 on Progress of the Transfer of 45% Equity Interest in Ningbo Daxie China Merchants International Terminals Co., Ltd. by a Majority-owned Subsidiary through Public Tender, and Announcement No. 2023-063 on Progress of the Transfer of 45% Equity Interest |
inNingboDaxieChinaMerchantsInternationalTerminals Co.,Ltd. by aMajority-ownedSubsidiarythroughPublicTenderonwww.cninfo.com.cn
IX Major SubsidiariesMajor fully/majority-owned subsidiaries and those minority-owned subsidiaries with an over 10%effect on the Company’s net profit
Unit: RMB
inNingboDaxieChinaMerchantsInternationalTerminals Co.,Ltd. by aMajority-ownedSubsidiarythroughPublicTenderonwww.cninfo.com.cnName
| Name | Relationship with the Company | Principal activity | Registered capital | Total assets | Net assets | Operating revenue | Operating profit | Net profit |
| Shanghai International Port (Group) Co., Ltd. | Joint stock company | Business related to port, container and terminal | 23,284,144,750.00 | 203,575,515,172.97 | 136,186,412,306.99 | 37,551,570,005.56 | 16,208,778,069.60 | 14,007,787,452.35 |
| China Merchants Port Holdings Company Limited | Subsidiary | Port business, bonded logistics and property investment | 48,730,938,830.02(HKD) | 151,230,903,375.40 | 104,970,107,380.42 | 10,503,277,811.44 | 7,531,020,573.54 | 6,466,697,575.11 |
| Ningbo Zhoushan Port Company Limited (note) | Joint stock company | Business related to port, integrated logistics, and trade sales | 19,454,388,399.00 | 112,329,401,000.00 | 80,698,048,000.00 | 25,993,200,000.00 | 6,207,455,000.00 | 5,156,174,000.00 |
Subsidiaries obtained or disposed in the Reporting Period:
Subsidiary
| Subsidiary | How subsidiary was obtained or disposed in the Reporting Period | Effects on overall operations and operating performance |
| Dalian Port Logistics Network Co., Ltd. | Transfer upon negotiation | No significant impact |
| Yingkou Port Information Technology Co., Ltd. | Transfer upon negotiation | No significant impact |
| Ningbo Daxie China Merchants International Container Terminal Co., Ltd. | Transfer upon negotiation | No significant impact |
| FORTUNE CENTRE GROUP LIMITED | Newly incorporated | No significant impact |
| SOUTH ASIA COMMERCIAL AND LOGISTICS HUB LIMITED | Newly incorporated | No significant impact |
| Zhanjiang Zhangang Technology Co., LTD | De-registered | No significant impact |
Notes of major holding companies and joint stock companiesThere is no information on major holding companies and joint stock companies for the Company todisclose during the Reporting Period.X. Structured Bodies Controlled by the Company? Applicable √ Not applicableXI Outlook for the Future Development of the Company
1. Layout and trends of the industry
In terms of the international economy and trade, the global economic structure continues to undergoprofound adjustments, and the impact of major international events such as the Russia-Ukraineconflict, the Palestinian-Israeli conflict and the Red Sea crisis will remain for a long time. Thewidening global divergence, especially in emerging markets and developing economies, has becomeincreasingly pronounced among regions. Meanwhile, the elections in major countries will bring moreuncertainty to the world, which have an adverse effect on the steady recovery of the global economy.However, the recovery of service industry and the decline of core inflation will be favorablesupporting factors for economic development for the coming year.
In terms of the domestic economy and trade, China continues to advance the “14th Five-Year Plan”in a strong and orderly manner. By adhering to the general tone of striving for progress whilemaintaining stability, China accelerates its construction of a new development pattern and focuses onpromoting high-quality development to comprehensively deepen reform and opening-up whileimplementing the new development philosophy fully, accurately and comprehensively. China willconsolidate and strengthen the positive trend of economic recovery and continuously promoteeffective economic improvement in quality and reasonable growth in quantity. With policies tostabilize economy gradually implemented and effects of trade agreements continuously released, the
liquidity of transnational trade elements will be further improved, the momentum of import and exportof commodities will be strengthened, economy and trade will stay within a reasonable ambit and thesteady development of port industry will be promoted.
In recent years, across the world are spreading unprecedented changes. Port, as a major carrier andpart of international trade flow, has played a significant role in global trade and transport systems.Global port operators have seized opportunities of the times, made efforts to improve the quality ofport services, continuously enlarged the sphere of influence of the ports, strengthened thecollaborative effects with other logistics participants and provided clients with higher-quality andmore comprehensive logistics solutions. Resources competition among international ports willcontinue, which will bring new opportunities and challenges to the port industry. In the future, theport industry will develop towards the following trends:
(1) Globalization of port network. With the pushed process of international economic integration andthe exacerbated competition in port markets globalization, the demand for port transformation andupgrade is no longer a desperate pursuit to maximize port handling capacity and corporate economicbenefits. Instead, it makes the maximization of the long-term value of ports a target. The Companyshould continue to complete and enrich the globalization layout of ports, identify acquisition projectswith investing potential, actively explore ports with strategic significance, and further improve thecompetence, influence and sustainability of the corporate.
(2) Integration of port services. The prominent issue of global supply chain and the acceleration ofregionalization and localization of industrial chain have further driven the expansion and reform ofthe port industry. While focusing on the major port business, the Company should actively expand itsport expansion business, carry out innovative port commercial modes, propose professional andcustomized logistics solutions, and provide clients with logistics services that are more flexible,secure and efficient.
(3) Digitalization of port operation. Port digitalization extent is outperforming the impact of physicalinfrastructure upgrades in increasing the port production efficiency. The breakthrough and innovationof digital techniques will accelerate the upgrade of the industry from “digitalization” to “digitalintelligence” and continuously empower the core businesses, such as the production, management,services and ecology of the port. Digital technology infuses the port enterprises with new momentum.
(4) Green and low-carbon ports. Port is a traditional tremendous source of energy consumption andcarbon emission. Governments around the world and international institutions have made a newrequest for green transformation to achieve the “Double Reduction” goal for energy consumption andtotal amount of emission. In IMO Preliminary Strategy for Greenhouse Gas Emission Reduction fromShips, the International Maritime Organization required that, the average carbon emission intensityper unit of transport work of global shipping industry shall decrease by at least 40% by 2030compared with 2008. The green and low-carbon transformation of port industry is not only in linewith the strategic demand by the country, but also makes an important contribution to the global greenenvironment and sustainable development.
2. Development strategy
The Company is committed to becoming a world-class comprehensive port service provider, baseitself in a new stage of development, implement the new development philosophy fully and faithfully.In pursuit of high-quality growth, it will accelerate technological leadership and innovation-drivendevelopment, achieve global scientific layout and balanced development, provide first-classcomprehensive port service professional solutions, seek more returns for shareholders, support localeconomic and industrial development, and contribute to the development of the port industry.
Firstly, in respect of the domestic homebase port strategies, the Company will seize the opportunityarising from the supply-side reform and based on the goal of “regional consolidation andenhancement of synergy”, seek for opportunities for consolidation and cooperation on an ongoingbasis across the five main coastal regions with a view to further expanding and improving the portsnetwork layout within China. The Group will lead a new direction for the consolidation of regionalports with a key focus on constantly improving the quality of port development with its best efforts.
Secondly, in respect of the overseas strategies, the Company will correctly understand and capitalizeon the opportunities arising from the international industrial transfers, at the same time adapting tothe trend of deploying mega-vessels and forming shipping alliances. Emphasis will be placed on thedevelopment of global major hub ports and gateway ports as well as areas with high market potential,fast-growing economy and promising development prospect. The Company will grasp opportunitiesin ports, logistics and related infrastructures investment for the on-going enhancement of its globalport network.
Thirdly, in respect of the innovation strategies, the Company will adhere to the principle of “drivingthrough technology and embracing changes”, under which the Company could support the future portdevelopment through increasing the investment in innovation and holding the technology high ground.By means of technological innovation and innovative management, it will significantly enhance theefficiency and effectiveness of port operation, which will help the Company transform from "scale-driven" to "quality-driven" and the business structure change from "simple port handling and storage"to "comprehensive services based on the main port business", supporting the Company's new leapfrogdevelopment with innovation, and continuously improving the Company's driving force ofdevelopment.
Fourthly, in respect of the digital strategies, the Company firmly grasps the development opportunitiesof "industrial digitization" and "digital industrialization", uses digitization as an entry point toempower the Company's production and operation, market expansion, operation management, andcapital operation. In line with the development trends of the times and the industry, the Company usesdigital technology to carry out all-round transformation of traditional port terminals to promoteindustrial optimization and upgrading. Relying on the stock assets and business of the ports, with thecore purpose of improving quality and efficiency, the Company improves the scientization andelaboration of production operation, customer service, operation management and decision-making,and promotes the comprehensive upgrade of port management and service intelligence.
Fifthly, in respect of the lean operation strategies, the Company continues to optimize its operationand management model to focus on the planning, allocation, organization and use of resources byadhering to the market orientation, taking resources as the core, and aiming to refine resourceallocation and enhance resource efficiency. The Company promotes the construction of acomprehensive management system covering the entire life cycle of resource demand assessment,resource allocation, production organization, risk management and control, sustainability and valuetree assessment, thereby facilitating the Company’s effective qualitative improvement and reasonablevolume growth through lean operation management and providing sustained momentum for theCompany's high-quality development.
Sixthly, in respect of the low-carbon strategies, the Company will firmly grasp the developmentopportunity of green industrial transformation and thoroughly implement the concept of greendevelopment, actively fulfil social responsibilities to continuously optimize the energy structure ofthe ports. It will improve its modern green port management system and mechanism, enrich the greenenergy supply scenarios, widely promote the concept of green investment and strive to build a newgeneration of green and smart ports with low energy consumption and low pollution.
3. Business plans for 2024
In 2024, the Company will continue to adhere to the general tone of making progress whilemaintaining stability. It takes "endogenous growth", "innovation and upgrade" and “global layout” asits development pace in accordance with the overall work policy of "seeking progress whilemaintaining stability, promoting stability through progress, and establishing the new beforeabolishing the old". Focusing on "improving the core competitiveness of the enterprise and enhancingcore functions", we will establish a lean operation management system for high-quality development.The Company will promote innovation in business models and technology empowerment, constantlyimproving its global network layout. The Company will continue to push forward the overall high-quality development and accelerate the construction of a world-class enterprise.
(1) Adhering to the strategic guidance, promoting the construction of leading port.
Focusing on the development strategic goals and tasks for the new decade, the Company will continueto drive the implementation of its various strategies. First, the Company will continuously refine andoptimize the “innovation strategies”, “digital strategies”, “lean operation strategies” and “low-carbonstrategies”. Second, we will constantly promote our domestic homebase port strategies. By optimizingthe collection and transportation infrastructure, expanding support resources outside the port,enhancing regional synergistic development and implementing green and low-carbon development,the West Shenzhen homebase port will continue to promote the construction of leading port, therebyfurther enhancing the competitiveness of homebase ports. Third, the Company will accelerate theadvancement of overseas strategies. With the objective of becoming a world-class enterprise, CICTactively respond to surrounding competition to fully leverage its strengths, consolidate and enhancethe main business capabilities of container ports, accelerate the construction of South Asia's trade andlogistics centre, and thereby expand the port's comprehensive logistics business. HIPG will focus onoil and gas, ro-ro trucks, bulk cargo, maritime services, regional container transshipment and park
development, and accelerating the construction of the “Six Centres” of Han Port.
(2) Strengthening lean management and promoting organic growth.
The Company will conduct internal reform based on the concept of lean management to reduce costsand increase efficiency: (1) enhancing financial management capabilities. The Company will build aworld-class financial management system, set up a lean operation team and explore new measures toreduce costs; (2) improving our capital operation capability. The Company will perfect a portfolio ofaction plan for quality and efficiency improvement, and constantly improve the efficiency of capitaloperation as well as the cash return of investment projects; (3) building up our operation andmanagement capabilities. The Company will establish professional, efficient and strong operation andmanagement headquarters, comprehensively implement lean management, strengthen cost control,focus on reducing costs and increasing efficiency, deepen reform and strengthen headquarters control;
(4) boosting our asset management capabilities. The Company will further optimize the life cyclemanagement system of projects, and gradually develop terminal handling capability and establishcost control and operation management model.
(3) Adhering to innovation-driven development and promoting industrial upgrading.
The Company will be committed to innovation-driven development and promote technology-empowered transformation and upgrading. Leveraging on the Research Institute of CMPort forTechnological Innovation and Development, the Company will develop the ecosystem for technologyand innovation, and generate smart solutions for ports to build the integrated platform for industry,education and research. Through “CMCore” platform, the Company will develop three major leadingproducts for the industry, including Container Terminal Operation System (“CTOS”), Bulk CargoTerminal Operation System (“BTOS”) and Logistic Park Operation System (“LPOS”), striving tointelligentize the production and operation within the terminals. Based on a major project approvedby the Ministry of Transport of the PRC, the Company has successfully completed a new structuraldesign for “CTOS” and achieved phased objectives. The “CM ePort” platform will innovate theservice models by improving the information service system and adopting the “Port + Internet”approach for the port to explore and develop an open platform for intelligent ports. "SMP" willcombine data management, the deepening of management, and AI LLM research and application topromote the intelligent business and management.
(4) Exploring the global layout and offering additional room for development.
The Company will further expand its international footprint and conduct resource integration, andsteadily offer additional room for development: (1) striving to promote the integration of domesticports to achieve business increments. The Company will constantly advance strategic cooperationwith SIPG Group and Zhejiang Seaport Group; (2) being “deeply rooted in Hong Kong” and makingfresh progress. The Company will promote the business model innovation and transformation andupgrading of CMCS, CMBL, China Merchants Hoi Tung and other enterprises, continue to focus onand follow up the merger and acquisition opportunities of port and logistics-related assets in HongKong; (3) being “intensively rooted in Southeast Asia” and making new breakthroughs. The Company
will facilitate the completion of the NPH project in Indonesia and constantly seek opportunities toinvest in port projects in Southeast Asia; (4) being “finely rooted in Middle East and Latin America”and further making headway. The Company will update regional investment strategy timely based onmarket changes and keep up with potential projects.
(5) Deepening reform and promoting high-quality development.
The Company will take the new round of state-owned enterprise reform deepening and upgradingaction as an opportunity to promote the reform of the system and mechanism and promote the high-quality development of the Company: (1) promoting the implementation of working record andreform plan of the “Double-Hundred Action”, and continuing to improve the high-qualitydevelopment as a listed company. The Company will give full play to the functions and powers of theboard of directors, establish a team of full-time external directors and improve the standard of theboard building at subsidiaries level; (2) deepening employment and institutional reform. TheCompany will further reform the system of posts, improve the talent introduction mechanism,strengthen the employer branding, further optimize management methods for total remunerations andthe medium - and long-term incentive mechanism, and further improve the overseas talentmanagement mechanism; (3) practicing ESG in depth. The Company will continue to perfect the ESGmanagement system, adopt good practices on ESG information disclosure, strengthen investorcommunication, build C Blue public-welfare brand, and continue to promote the green and low-carbon development of the Company.
4. Possible risks and counter measures
(1) Risk of macroeconomic fluctuations
Internationally, in view of the rising external risks and challenges, plus several combined andinterwoven factors, the uncertainties arising from the global economic recovery have increased. Dueto the tight supply of international crude oil and natural gas, the scale of government debt in developedeconomies repeatedly reaching new highs, high benchmark interest rates in Europe and the UnitedStates, currency devaluation faced by developing countries and the reshaping of the industrial andsupply chain, the global economic growth and commodity trade market have been exposed to shocks,bringing challenges to the Company’s overseas operations and investments. Domestically, theeconomy has gradually recovered and maintained its long-term positive growth trend. However,external demand has significantly declined affected by high inflation, high interest rates and high debt,and domestic consumer demand remains to be boosted, plus continually unstable real estate market,which will exert multiple pressure on the economy.
Amidst the complex external environment, the Company insists on emphasizing top-level design, andhas a deeper insight into the global development trend and adheres to the global thinking in planningthe future development. The Company will optimize the global layout through the transformation andupgrading of ports, intensify efforts in key and core technologies and enhance the momentum ofoverall development; grasp the policy environment of high-level opening-up to the outside world,gradually improve the regular and long-term internal collaboration system, further enhance the
connectivity with trade, promote the smooth flow of goods and resources of production factors on alarger scale, and expand the service scope and hinterland areas of ports; closely follow the changesin the global market, keep an eye on major international geopolitical development as well as thereconstruction of global industrial and supply chain, timely adjust the Company's business strategies,accurately grasp the trend and prevent the occurrence of major external risk events.
(2) Policy risks
There are diverse policy risks in the port industry. Internationally, due to the frequent occurrence ofstrike actions in docks arising from inflation, the dock operation in some developed countries hasbeen confronted with a risk of halt, resulting in a pile-up of cargos and shipment delays. Such asituation, with the concurrence of the contradiction between operators and labor, may force thegovernment roll out new policies and measures. Domestically, China adopts a more proactiveopening-up strategy, develops a deeper pattern of opening-up, promotes the optimization andupgrading of trade in goods, innovates the development mechanism of trade in services, developsdigital trade and introduces a series of policies conducive to import and export trade.
Facing the potential policy risks, on the one hand, the Company will strengthen the policy research,firmly grasp policy opportunities. On the other hand, the Company will improve quality and increaseefficiency and strengthen the allocation of resources to enhance operational management, constantlyimprove profitability and effectively respond to and resolve risks.
(3) Operation management risks
The Company actively seeks the investment opportunities of domestic and overseas ports, expandsits network to several regions and countries in the world through mergers and acquisitions,acquisitions, equity swaps and other ways to provide comprehensive services for global customers.With the deepening of the globalization process and the adverse changes in the macro environment,the Company is facing negative conditions such as increased difficulties in the operation andmanagement of ports in some regions and lower returns on investment and operational efficiency.The main risks include: (1) the uncertainty and complexity of the place where the Company operates,which further increases the risk of investment decisions and the difficulty of investment, operationand management; (2) international exchange rate fluctuations affecting different regions. A two-wayfluctuation of the RMB exchange rate is obvious, and this year it presented the trend of rising-falling-rising, while in emerging economies, the imported inflationary pressure has caused the fluctuationsof exchange rate and capital market; (3) increased operation and management difficulties in view ofdifferent business operations between domestic ports and overseas ports.
In view of the Company's internal business management risks, the Company will (1) enhancecompetitiveness based on three elements, namely “market, resources and services” , increase existingcustomer loyalty, take the initiative to identify new customers and grasp market opportunities; (2)improve the construction of the internal control and compliance system, strengthen the legalempowerment of business capabilities, ensuring effective risk identification and control andconsolidating the foundation of risk control; (3) improve the risk warning system, continue to
strengthen risk identification, early warning and resolution capabilities, do a good job in key riskprevention and management in a stable and orderly manner, and continuously improve the Company'srisk prevention capabilities; (4) actively explore and innovate the international operation managementmodel, make good use of digital technology to build smart platforms, and improve the overalloperation.XII Communications with the Investment Community such as Researches, Inquiries andInterviews
Date
| Date | Place | Way of communication | Type of communication party | Object of communication | Index to basic information of researches |
| 4 April 2023 | China Merchants Port Building | Teleconferencing | Institution | Representatives from institutions, such as Huachuang Securities, Zheshang Securities, Industrial Securities, Shenwan Hongyuan Securities, Essence Securities, BOC International (China) Co., Ltd., Western Securities, Sinolink Securities, Everbright Securities, Harvest Fund, Bosera Fund, UBS | Main discussions: the basic condition of operations, investments made and the financial condition of the Company; Materials provided: None Index: SZSE EasyIR (http://irm.cninfo.com.cn/ircs/index) |
| 6 April 2023 | China Merchants Port Building | Online communication on network platform | Institution+Individual | All investors | |
| 10 May 2023 | China Merchants Port Building | One-on-one meeting | Institution | Huachuang Securities, Zheshang Securities, Harmony Capital, China Life Insurance, HZBank Wealth Management, Jinxin Fund, Deyun Asset Management, Minsen Investment, Hengli Fund | |
| 31 August 2023 | China Merchants Port Building | Conference call | Institution | Huachuang Securities, ZTF Securities, Bosera Fund, BOCOM Schroders, Essence Securities, Capital Securities, Hazel Investment, Golden Eagle Fund, Orient Securities, Industrial Securities, Changjiang Securities, Shanghai Securities, Fulida Asset, Zheshang Securities, and Northeast Securities |
4 September 2023
| 4 September 2023 | China Merchants Port Building | Conference call | Institution |
Orient Securities, ChinaSecurities, TianfengSecurities, Harvest Fund,Citic-prudential Fund,BOSC AssetManagement, IGWTInvestment, Sun LifeEverbright AssetManagement, andTaiping AssetManagement
| 8 September 2023 | China Merchants Port Building | Online communication on network platform | Institution+Individual | All investors | |
| 15 November 2023 | China Merchants Port Building | Online communication on network platform | Institution+Individual | All investors | |
| 1 January 2023-31 December 2023 | China Merchants Port Building | By phone, or written inquiry (the EasyIR platform of SZSE or email) | Individual | Individual investors | Main discussions: the basic condition of operations, investments made and the financial condition of the Company; Materials provided: None |
| Times of communications | 85 | ||||
| Number of institutions communicated with | 45 | ||||
| Number of individuals communicated with | 85 | ||||
| Number of other communication parties | 0 | ||||
| Tip-offs or leakages of substantial supposedly-confidential information during communications | No | ||||
XIII Implementation of the action plan of "Double Improvement of Quality Reporting"Whether the company disclosed the action plan of "Double Improvement of Quality Reporting".
□ Yes √ No
Part IV Corporate Governance
I General Information of Corporate GovernanceEver since its establishment, the Company has been in strict compliance with the Company Law andSecurities Law, as well as relevant laws and regulations issued by CSRC. And it has timely formulatedand amended its relevant management rules according to the Code of Corporate Governance forListed Companies, which are conscientiously and carefully executed. An effective system of internalcontrol has thus taken shape in the Company. Details about corporate governance are set out as below:
1. Establishment of systems:
(1) Corporate governance mechanisms and rules that the Company has already established: Articlesof Association of the Company, Rules of Procedure for General Meetings, Rules of Procedure for theBoard of Directors, Working Articles of Audit Committee of the Board of Directors, Working Rulesof Annual Report for Audit Committee of the Board of Directors, Working Articles for Nomination,Remuneration and Evaluation Committee of the Board of Directors; Working Articles of Strategy andSustainability Committee of the Board of Directors, Working System for Independent Directors,Working Rules of Annual Report for Independent Directors, Rules of Procedure for the SupervisoryCommittee, Working Articles of Chief Executive Officer, Management System for Company Sharesheld by Directors, Supervisors and Senior Executives and Its Changes, Management System ofOutward Investment, Management System of Related-party Transactions, Management System ofFund-raising, Management Rules on Information Disclosure, Rules of Accountability for SignificantMistakes in Annual Report Information Disclosure, Management System on Inside Information andInsiders, Internal Audit System, Management System of Investors’ Relations, Specific System forEngaging Accountants, Management Method of Financial Tools, Management System on Person inCharge of Finance and CFO, Information Disclosure Management Rules for the Inter-bank DebtFinancing Instrument, Management System of External Guarantees, Working Articles of BoardSecretary, Management System of Securities Investments, Management System of Subsidiaries,Management Method of Donations, Rules of Procedures for Office Meeting, Management System onthe Authorization of the Board of Directors, Liabilities Management System, etc. There isn’tdifference between the actual circumstances of the Company and all established systems.
(2) System establishment and revisions: As per the relevant regulations of the China SecuritiesRegulatory Commission and the Shenzhen Stock Exchange, between the beginning of the ReportingPeriod and the date of disclosure of this report, the Company revised 11 systems and created 4 newsystems, with the relevant information disclosed on www.cninfo.com.cn, demonstrating sound andeffective systems. And details are as follows:
Mechanism
| Mechanism | Approval |
| Management Methods for the Remunerations of Managers, Management Methods for Professional Managers, Management Methods for the Tenure and Contract-based System, and Liabilities Management System | Approved at the 1st Extraordinary Meeting of the 10th Board of Directors in 2023 on 19 January 2023 |
| Working Articles of Audit Committee of the Board of Directors, Working Articles for Nomination, Remuneration and Evaluation Committee of the Board of Directors; Working Articles of Strategy and Sustainability Committee of the Board of Directors, Working Articles of Chief Executive Officer, Management System of Investors’ Relations, and Performance Appraisal Methods for Managers | Approved at the 5th Extraordinary Meeting of the 11th Board of Directors in 2023 on 25 October 2023 |
| Articles of Association of the Company, Rules of Procedure for the Board of Directors, Working System for Independent Directors, and Management Method of Donations | Approved at the 2nd Extraordinary General Meeting of 2023 on 5 December 2023 |
| Rules of Procedures for Office Meeting | Approved at the 6th Extraordinary Meeting of the 11th Board of Directors in 2023 on 28 December 2023 |
2. Shareholders and shareholders’ general meeting: the Company ensures that all the shareholders,especially minority shareholders, are equal and could enjoy their full rights. The Company called andheld shareholders’ general meeting strictly in compliance with the Rules for Shareholders’ GeneralMeeting.
3. Relationship between the controlling shareholder and the Company: controlling shareholder of theCompany acted in line with rules during the reporting period, did not intervened the decisions,productions or operations of the Company directly or indirectly in exceeding the authority of theshareholders’ general meeting, and did not occupy any funds of the Company.
4. Directors and the Board of Directors: the Company elected directors in strict accordance with theArticles of Association. Number and composition of members of the Board were in compliance with
relevant laws and regulations. During the Reporting Period, the Company successfully completed thegeneral election of the Board of Directors. During the Reporting Period, the Board of Directorsimplemented six powers including rights to make decisions on medium- and long-term development,select and engage Management members, evaluate performance of Management members, managethe remuneration of Management members, manage the distribution of employees and manage majorfinancial affairs in accordance with the Implementation of the Functions and Powers of the Board ofDirectors, strengthening the ability of the Board of Directors to exercise their rights and fulfil theirresponsibilities. All directors of the Company fulfilled their responsibilities loyally and diligently,actively attending the Board Meeting and the General Meeting, expressing views and discussing onproposals submitted to and deliberated by the Board during the Reporting Period. Proposalsdeliberated by the Board were all agreed. The Board of Directors of the Company has set up the AuditCommittee, the Nomination, Remuneration and Evaluation Committee, and the Strategy andSustainable Development Committee. During the Reporting Period, each committee gave full play toits professional functions, researched each professional affairs, offered views and advice, assisted theBoard in carrying out works, and actively came up with ideas, providing strong guarantee for thescientific and efficient decision-making of the Board.
5. Supervisors and the Supervisory Committee: number and composition of the members of theSupervisory Committee were in compliance with the requirements of laws and regulations. Duringthe Reporting Period, the Company successfully completed the general election of the SupervisoryCommittee. The supervisors diligently and seriously performed their duties and obligations, tookresponsible attitudes to all shareholders and supervised the financial affair as well as the performanceby the Company’s Directors, managers and other senior executives of their duties in compliance withthe laws and regulations.
6. Stakeholders: the Company fully respected and safeguarded the legal rights and interests of thebanks and other creditors, staff, clients and other stakeholders so as to develop the Company in aconsistent and healthy way.
7. Information disclosure and transparency: As the department for the management of informationdisclosure, the Board of Directors of the Company is responsible for managing the informationdisclosure matters of the Company. Chairman of the Board assumes a central role in managing the
information disclosure matters of the Company while the Board Secretary is responsible fororganizing and coordinating such matters. The Board Secretary of the Company is responsible for themanagement of investor relationships. Unless expressly authorized and trained, other directors,supervisors, senior management members and staff members of the Company should avoid speakingon behalf of the Company in investor relationship activities. The Company disclosed relevantinformation in a true, accurate, complete and timely way in strict accordance with the requirementsof laws, regulations and the Articles of Association, formulated the Management Rules onInformation Disclosure, the Management System on Inside Information and Insiders and the Ruleson the Management of Investors Relations, and designated Securities Times, China Securities Journal,Shanghai Securities News, and http://www.cninfo.com.cn as its newspaper and website forinformation disclosure, so as to ensure all shareholders have equal opportunity to obtain theinformation.Since the foundation, the Company was consistently in strict accordance with Company Law andrelevant laws and regulations to make a standard operation, continued business-running in line withrelevant requirements of Corporate Governance Principle for Listed Companies and earnestly madeeffort to protect profit and interests of shareholders and stakeholders.Indicate by tick market whether there is any material incompliance with the laws, administrativeregulations and regulations issued by the CSRC governing the governance of listed companies.
□ Yes √ No
No such cases in the Reporting Period.II The Company’s Independence from Its Controlling Shareholder and Actual Controller inAsset, Personnel, Financial Affairs, Organization and BusinessThe Company is absolutely independent in business, personnel, assets, finance and organization fromits controlling shareholder and actual controller. Details are set out as follows.Separation in business: The Company has its own assets, personnel, qualifications and ability to carryout operating activities and is able to operate independently in the market. Separation in personnel:
The Company has basically separated its staff from its controlling shareholder. No senior managementstaff of the Company holds positions at controlling shareholder of the Company. Separation in assets:
The Company possesses its own self-governed assets and domicile. Separation in organization: The
Company has established and improved the corporate governance structure according to law and hasan independent and complete organizational structure. Separation in finance: The Company has setup its own financial department as well as normative accounting system and the financialmanagement system on its subsidiaries. The Company has its own bank accounts and does not sharethe same bank account with its controlling shareholder. The Company has been paying tax inaccordance with the laws and regulations on its own behalf.III Horizontal Competition
□ Applicable √ Not applicable
IV Annual and Special General Meetings Convened during the Reporting Period
1. General Meeting Convened during the Reporting Period
Meeting
| Meeting | Type | Investor participation ratio | Date of the meeting | Disclosure date | Index to disclosed information |
| The 2022 Annual General Meeting | Annual General Meeting | 90.81% | 22 May 2023 | 23 May 2023 | For the resolution announcement (No. 2023-045), see http://www.cninfo.com.cn |
| The 1st Extraordinary General Meeting of 2023 | Extraordinary General Meeting | 90.75% | 31 July 2023 | 1 August 2023 | For the resolution announcement (No. 2023-060), see http://www.cninfo.com.cn |
| The 2nd Extraordinary General Meeting of 2023 | Extraordinary General Meeting | 90.49% | 5 December 2023 | 6 December 2023 | For the resolution announcement (No. 2023-088), see http://www.cninfo.com.cn |
2. Special General Meetings Convened at the Request of Preferred Shareholders with Resumed
Voting Rights
□ Applicable √ Not applicable
V Directors, Supervisors and Senior Management
1. General Information
Name
| Name | Gender | Age | Office title | Incumbent/Former | Start of tenure | End of tenure | Beginning shareholding (share) | Increase in the Reporting Period (share) | Decrease in the Reporting Period (share) | Other increase/decrease (share) | Ending shareholding (share) | Reason for share change |
| Feng Boming | Male | 54 | Chairman of the Board | Incumbent | July 2023 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
| Xu Song | Male | 52 | Vice Chairman of the Board and CEO | Incumbent | July 2023 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
| Yan Gang | Male | 51 | Vice Chairman of the Board | Incumbent | May 2022 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
| Lu Yongxin | Male | 54 | Director, Chief Operation Officer, and General Manager | Incumbent | July 2023 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
| Li Zhanglin | Male | 57 | Director | Incumbent | January 2024 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
| Li Qing | Male | 54 | Director | Incumbent | January 2024 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
| Wu Changpan | Male | 54 | Director | Incumbent | December 2022 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
| Lyu Yiqiang | Male | 47 | Director | Incumbent | December 2022 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
| Gao Ping | Male | 68 | Independent director | Incumbent | May 2020 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
| Li Qi | Female | 53 | Independent director | Incumbent | May 2020 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
| Zheng Yongkuan | Male | 46 | Independent director | Incumbent | May 2021 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
| Chai Yueting | Male | 60 | Independent director | Incumbent | December 2022 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
| Yang Yuntao | Male | 57 | Chairman of the Supervisory Committee | Incumbent | October 2021 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
| Fu Bulin | Male | 52 | Supervisor | Incumbent | April 2022 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
| Xu Jia | Male | 42 | Supervisor | Incumbent | May 2020 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
| Lei Yuanyuan | Female | 34 | Supervisor | Incumbent | May 2023 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
| Tu Xiaoping | Male | 58 | CFO | Incumbent | May 2021 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
| Li Yubin | Male | 52 | Deputy General Manager | Incumbent | December 2018 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
Board Secretary
| Board Secretary | Incumbent | April 2021 | May 2026 | |||||||||
| Liu Bin | Male | 55 | Deputy General Manager | Incumbent | September 2022 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
| Zhu Weida | Male | 55 | Deputy General Manager | Incumbent | April 2023 | May 2026 | ||||||
| Li Wenbo | Male | 44 | Deputy General Manager | Incumbent | August 2023 | May 2026 | ||||||
| Liu Libing | Male | 50 | General Counsel (Chief Compliance Officer) | Incumbent | August 2020 | May 2026 | 0 | 0 | 0 | 0 | 0 | N/A |
| Deng Renjie | Male | 54 | Former Chairman of the Board | Former | December 2018 | July 2023 | 0 | 0 | 0 | 0 | 0 | N/A |
| Wang Xiufeng | Male | 53 | Former Vice Chairman of the Board and CEO | Former | August 2021 | July 2023 | 0 | 0 | 0 | 0 | 0 | N/A |
| Zhang Rui | Male | 58 | Former Director | Former | April 2022 | January 2024 | 0 | 0 | 0 | 0 | 0 | N/A |
| Liu Weiwu | Male | 59 | Former Director | Former | May 2021 | January 2024 | 0 | 0 | 0 | 0 | 0 | N/A |
| Gong Man | Female | 35 | Former Supervisor | Former | May 2020 | April 2023 | 0 | 0 | 0 | 0 | 0 | N/A |
| Total | -- | -- | -- | -- | -- | -- | 0 | 0 | 0 | 0 | 0 | -- |
Indicate by tick mark whether any directors or supervisors left or any senior management weredisengaged during the Reporting Period
√ Yes □ No
During the Reporting Period, the directors, supervisors and senior management of the Company leftmainly for job change. For more details, please see the table below.Change of Directors, Supervisors and Senior Management
| Name | Office title | Type of change | Date of change | Reason for change |
| Gong Man | Employee Supervisor | Resigned | 7 April 2023 | Job change |
| Zhu Weida | Deputy General Manager | Appointed | 29 April 2023 | Appointed |
| Lei Yuanyuan | Employee Supervisor | Elected | 22 May 2023 | Elected |
| Deng Renjie | Director, Chairman of the Board | Resigned | 10 July 2023 | Job change |
| Wang Xiufeng | Director, Vice Chairman of the Board and CEO | Resigned | 10 July 2023 | Job change |
| Xu Song | Chief Operation Officer, and General Manager | Resigned | 14 July 2023 | Reappointment |
| Xu Song | CEO | Appointed | 14 July 2023 | Appointed |
| Lu Yongxin | Deputy General Manager | Resigned | 14 July 2023 | Reappointment |
| Lu Yongxin | Chief Operation Officer, and General Manager | Appointed | 14 July 2023 | Appointed |
| Feng Boming | Director, Chairman of the Board | Elected | 31 July 2023 | Elected |
Xu Song
| Xu Song | Vice Chairman of the Board | Elected | 31 July 2023 | Elected |
| Lu Yongxin | Director | Elected | 31 July 2023 | Elected |
| Li Wenbo | Deputy General Manager | Appointed | 16 August 2023 | Appointed |
| Liu Libing | Chief Compliance Officer | Appointed | 16 August 2023 | Appointed |
| Zhang Rui | Director | Resigned | 8 January 2024 | Job change |
| Liu Weiwu | Director | Resigned | 8 January 2024 | Job change |
| Li Zhanglin | Director | Elected | 31 January 2024 | Elected |
| Li Qing | Director | Elected | 31 January 2024 | Elected |
2. Biographical Information
Professional backgrounds, major work experience and current duties in the Company of theincumbent directors, supervisors and senior management:
Feng Boming, Chairman of the Board, and economist, graduated from the University of HongKong, with a master’s degree in business administration. He is currently Chairman of the Company,Deputy General Manager of China Merchants Group Limited, Chairman of Liaoning Port Group Co.,Ltd., Chairman of the Board of Directors and a non-executive director of China Merchants PortHoldings Company Limited, Chairman of China Merchants Energy Shipping Co., Ltd., and Chairmanof Sinotrans Limited. He served as Manager of the Commercial Department of COSCO ShippingLines Co., Ltd., General Manager of COSCO Shipping (Hong Kong) MERCURY, General Managerof the Operation and Management Department of COSCO Shipping Holdings (Hong Kong), GeneralManager of COSCO Shipping Lines (Wuhan) Co., Ltd./COSCO Logistics (Wuhan) Co., Ltd.,Director of the Strategic Management Implementation Office of China COSCO Shipping (Group)Company, General Manager of the Strategic and Enterprise Management Department of COSCOShipping Corporation Limited, executive director and Chairman of the Board of Directors of COSCOShipping Ports Ltd., executive director of COSCO Shipping Holdings Co., Ltd. and Oriental Overseas(International) Limited, non-executive director of COSCO Shipping Energy Transportation Co., Ltd.,COSCO Shipping Development Co., Ltd., COSCO Shipping International (Hong Kong) Co., Ltd.,Qingdao Port International Co., Ltd. and Piraeus Port Authority S.A., as well as director of COSCO
Shipping (Hong Kong) Co., Ltd., COSCO Shipping Investment Holdings Co., Limited, HainanHarbor & Shipping Holding Co., Ltd., COSCO Shipping Bulk Co., Ltd., and Chairman and non-executive director of Sinotrans Limited. Mr. Feng has been the Chairman of the Board of theCompany since July 2023.Xu Song, Vice Chairman of the Board, CEO, a senior Economist, holds a bachelor's degree inMaterial Management of the Huazhong University of Science and Technology, Master of BusinessAdministration (MBA) of the Dongbei University of Finance & Economics, Master of InternationalBusiness (MIB) of the Coventry University, and Ph.D. in Transportation Planning and Managementof the Dalian Maritime University. Currently, he serves as the Vice Chairman of the Board and CEOof the Company, as well as the Vice Chairman and CEO of China Merchants Port Holdings CompanyLimited. He used to work as Deputy General Manager at Dalian Port Container Co., Ltd.; DeputyGeneral Manager and General Manager at Dalian Port Jifa Logistics Co., Ltd.; General Manager atDalian Port Container Co., Ltd.; General Manager at Dalian Port Northern Huanghai Sea PortCooperative Management Company; General Manager at Dalian Port (PDA) Company Limited;Deputy General Manager, director, and General Manager of Dalian Port; Deputy General Managerof Liaoning Port Group Co., Ltd.; Deputy General Manager, General Manager and COO of theCompany; Director of Liaoning Port Co., Ltd. He has been Director of the Company since September2022, Vice Chairman of the Board and CEO of the Company since July 2023.Yan Gang, Vice Chairman of the Board, graduated from Xiamen University with a bachelor’s ininternational trade, and completed an MBA program co-created by the Maastricht School ofManagement (Maastricht, the Netherlands) and Shanghai Maritime University. He now serves asVice Chairman of the Board of the Company, non-executive director of China Merchants PortHoldings Company Limited, member of Commercial (Third) Functional Constituency of theLegislative Council of the Hong Kong Special Administrative Region of the People’s Republic ofChina, Vice Chairman of Panel on Economic Development of the Legislative Council of the HongKong Special Administrative Region of the People’s Republic of China, and member of the Maritime
and Port Development Committee of Hong Kong Maritime and Port Board. He served as the seniorlogistic manager in Neptune Orient Lines Limited and Hong Kong Swire Group, Chief CommercialSupervisor, Deputy General Manager, Executive Deputy General Manager and General Manager ofShekou Container Terminals Limited, Deputy General Manager, Chief Commercial Officer andManaging Director of China Merchants Port Holdings Company Limited, Chief Representative ofthe Representative Office of China Merchants Group Limited in the Baltic Sea, General Manager ofGreat Stone Industrial Park, Deputy General Manager, Chief Operating Officer and General Managerof China Merchants Port Group Co., Ltd., and the member of the Pilotage Advisory Committee ofMarine Department of the Government of the Hong Kong Special Administrative Region and theLogistic Service Advisory Committee of Hong Kong Trade Development Council. He has served asa Director of the Company since April 2022 and Vice Chairman of the Board of the Company sinceMay 2022.Lu Yongxin, Director, COO and General Manager, graduated from Dalian University ofTechnology, and obtained bachelor’s degree in English for science and technology. Later Lu Yongxingraduated from Curtin University and obtained master’s degree in project management. Lu Yongxinnow serves as Director, COO and General Manager of the Company, as well as Executive Directorand Managing Director of China Merchants Port Holdings Company Limited. Lu Yongxin hassuccessively held the posts of Assistant General Manager of Zhenhua Construction Co. Ltd., DeputyDirector of General Manager’s Office of China Harbour Engineering Company Limited (Presiding),Deputy General Manager of Research & Development Department of China Merchants Port HoldingsCompany Limited, General Manager of Overseas Business Department, Assistant General Managerand Deputy General Manager of the company, Deputy General Manager of the Company. Lu Yongxinhas been dispatched to Terminal Link in France to act as CFO and Senior Vice President. Lu Yongxinhas been as the Director, COO and General Manager of the Company since July 2023.Li Zhanglin, Director, and senior economist, graduated from the School of Statistics of RenminUniversity of China, with a master’s degree in economics. He is currently a director of the Company,
a full-time external director sent by China Merchants Group Corporation Limited and a supervisor ofChina Merchants Expressway Network & Technology Holdings Co., Ltd. He served as AssistantGeneral Manager of the Enterprise Planning Department, Deputy Director of the ComprehensiveTransportation Department/Overseas Business Department, and Deputy Director of theTransportation and Logistics Department of China Merchants Group Corporation Limited, andDeputy General Manager of Sinotrans Limited, and worked at the Planning Department of theMinistry of Transportation, and the Securities Management Department of China MerchantsExpressway Network & Technology Holdings Co., Ltd.. Mr. Li has been Chairman of the Board ofDirectors of the Company since January 2024.Li Qing, Director, graduated from Sichuan Normal College, majoring in Political Economy, with abachelor’s degree in Philosophy. He is currently a director of the Company, a full-time externaldirector sent by China Merchants Group Corporation Limited and a supervisor of China MerchantsHainan Development & Investment Co., Ltd. He served as Assistant General Manager of the BusinessDevelopment Department of China Merchants Group Corporation Limited and Deputy Director ofMajor Project Office and Director of Qianhai Office, Assistant Director of Capital OperationDepartment of China Merchants Group Corporation Limited and Deputy Director of Major Officeand Director of Qianhai Office, Assistant Director and Deputy Director of Regional DevelopmentDepartment of China Merchants Group Corporation Limited, and Assistant Director and DeputyDirector of Qianhai Shekou FTZ Office, as well as Deputy Director of Industrial DevelopmentDepartment/Business Collaboration Department of China Merchants Group Corporation Limited. Mr.Li has been Chairman of the Board of Directors of the Company since January 2024.Wu Changpan, Director, graduated from the Power Plant and Power System major of HangzhouElectric Power College and Human Resource major of Central China Normal University. He nowserves as a Director of the Company and Director of Investment Development Department inZhejiang Provincial Seaport Investment & Operation Co., Ltd. and Ningbo Zhoushan Port Group Co.,Ltd. Mr. Wu has served as Deputy Director and Director of Comprehensive Office of ZhejiangElectric Power Construction Company, Deputy Director and Director of Comprehensive Office of
Zhejiang Electric Power Construction Co., Ltd., Deputy Director and Director of Investment andDevelopment Department of Ningbo Zhoushan Port Group Co., Ltd. He has served as a Director ofthe Company since December 2022.Lyu Yiqiang, Director, graduated from the Management School of Wuhan University ofTransportation and Technology with bachelor’s degree in management engineering and the School ofEconomics & Management in Shanghai Maritime University with master’s degree in businessadministration. He now serves as a Director of the Company and the Director of Production SafetyDepartment in Zhejiang Provincial Seaport Investment & Operation Co., Ltd. and Ningbo ZhoushanPort Group Co., Ltd. Mr. Lyu has served in the warehouse yard team and as a staff member of MaterialDivision of Beilun Container Company of Ningbo Port Authority, a Market Director of CommerceDepartment and Duty Manager of Operations Department of Ningbo Beilun International ContainerTerminals, Deputy Head of Container Division of Business Department of Ningbo Port CompanyLimited, General Manager of Ningbo Xinggang International Shipping Agency Co., Ltd., DeputyGeneral Manager of Zhejiang Yiwu Port Co., Ltd., and General Manager of Suzhou ModernTerminals Co., Ltd. He has served as a Director of the Company since December 2022.Gao Ping, Independent Director, obtained Executive Master of Business Administration from theUniversity of International Business and Economics (UIBE). He is also a senior engineer and seniorpolitical worker. Currently, he serves as an Independent Director in the Company. His former titlesincluded first mate, Management Section Chief, and HR Manager at Shanghai Ocean Shipping Co.,Ltd., HR General Manager at COSCO Container Lines Co., Ltd., General Manager at the CrewDepartment of COSCO (H.K.) Shipping Co., Ltd., Deputy General Manager at COSCO (H.K.)Shipping Co., Ltd., Deputy General Manager at Shenzhen Ocean Shipping Co., Ltd. under COSCO(H.K.) Shipping Co., Ltd., General Manager at the Organization Department/HR Department ofChina COSCO SHIPPING Corporation Limited (COSCO SHIPPING Group), Deputy GeneralManager at COSCO Shipping Lines Co., Ltd., member of 11th and 12th Shanghai Committees of theChinese People's Political Consultative Conference (CPPCC), and Deputy Director of the Committeefor Economic Affairs of the Shanghai Committee of the CPPCC. He has served as an IndependentDirector of the Company since May 2020.
Li Qi, Independent Director, graduated from Guanghua School of Management, Peking Universitywith a PhD degree in Business Administration. Currently, she serves as an Independent Director inthe Company, as well as an associate professor at the Department of Accounting of the GuanghuaSchool of Management, Peking University. She worked as a teaching assistant and lecturer at theDepartment of Accounting of the Guanghua School of Management, Peking University, Assistant tothe Dean and Deputy Secretary of CPC of the Guanghua School of Management, Peking University.She has been an independent director of the Company since May 2020.Zheng Yongkuan, Independent Director, graduated from China University of Political Science andLaw with bachelor's degree in law, a master's degree in civil and commercial law and doctor degreein civil and commercial law. He is now an Independent Director in the Company, as well as aprofessor of Law School, Head of Civil and Commercial Law Teaching and Research Section andDirector of Tort Law Research Center in Xiamen University. He is also a director of Civil LawResearch Institute of China Law Society, Vice President of Civil and Commercial Law ResearchInstitute of Fujian Law Society, arbitrator of Xiamen Arbitration Commission, arbitrator of QuanzhouArbitration Commission, a lawyer of Fidelity Law Firm, and an Independent Director of Fujian DeerTechnology Corp. He has been an assistant professor and associate professor in Law School, XiamenUniversity. He has served as an independent director of the Company since May 2021.Chai Yueting, Independent Director, graduated from the Department of Automation of TsinghuaUniversity with a master’s degree and a doctoral degree in engineering. He now serves as anIndependent Director of the Company, doctoral mentor in automation in Tsinghua University,Director of National Engineering Laboratory for E-Commerce Technologies, Leader of the ExpertTeam for Modern Services of the Ministry of Science and Technology of the People’s Republic ofChina, E-Commerce Standardization Team of the Standardization Administration and Expert Teamof Expert Advisory Committee for Development of National E-Commerce Demonstration Cities,editor of the international, academic journal International Journal of Crowd Science, and IndependentDirector of Xinfangsheng Digital Intelligence Technology Co., Ltd. Mr. Chai has served as a memberof the 2nd and 3rd Expert Advisory Committee of State Informatization. He serves as an IndependentDirector of the Company since December 2022.Yang Yuntao, Chairman of the Supervisory Committee, graduated from Jilin University, majoringin international law, and obtained bachelor’s degree in law. Later Yang Yuntao studied at School ofLaw, University of International Business and Economics, and obtained doctor’s degree in law. He is
now Chairman of the Supervisory Committee of the Company, and Head of the Risk ManagementDepartment/Legal Compliance Department/Audit Department of CMG. Yang Yuntao hassuccessively held the posts of Deputy General Manager of Port Business Department of Sino-TransChina National Foreign Trade Transportation Corporation, General Manager of Law Department,Director, Deputy President (principal person) of SINOTRANS (Hong Kong) Group CompanyLimited, Non-Executive Director of SINOTRANS Limited, General Manager of Law Department ofSino-Trans China Foreign Trade Transportation (Group) Corporation, General Manager, DeputyGeneral Counsel, General Counsel and General Manager of Law Department of SINOTRANS &CSC, Deputy Director of Transportation & Logistics Business Department/Beijing Headquarters ofChina Merchants Group Company Limited., Deputy Director of Shipping Business ManagementPreparatory Office of China Merchants Group, Deputy General Manager and General Counsel ofChina Merchants Energy Shipping Co., Ltd.,. Yang Yuntao has been being the Supervisor of theCompany since December 2018 and the Chairman of the Supervisory Committee of the Companysince October 2021.Fu Bulin, Supervisor, intermediate accountant, graduated from the Accounting Department ofShanghai Maritime University with a bachelor’s degree in economics, and a master’s degree inbusiness management from the University of South Australia. He now serves as a Supervisor of theCompany and Deputy Director of Audit Department in China Merchants Group Limited. Mr. Fu hasserved as an Accounting Department Chief of the China Merchants Zhangzhou Development ZonesCo., Ltd., Deputy Director, Manager and Senior Manager of Audit Department of the ChinaMerchants Group Limited, and Assistant of the General Manager of Audit Department, Assistant ofthe Head of Risk Management Department and Deputy Director of the Audit Centre of ChinaMerchants Group Limited. He serves as a Supervisor of the Company since April 2022.Xu Jia, Supervisor, graduated from the Wuhan University of Technology and obtained a master'sdegree in Control Theory and Control Engineering. Currently, he is a supervisor and the DeputyGeneral Manager at the Operations Management Department of the Company. He worked as a SeniorSystem Planning Engineer and Project Planning Director at the Engineering Technology Department
of Shekou Container Terminal Co., Ltd. He has been a supervisor of the Company since May 2020.Lei Yuanyuan, Supervisor, graduated from Shanxi University of Finance and Economics and witha bachelor’s degree in financial management and in finance. She is currently a supervisor of theCompany and the Senior Manager of the Financial Management Department/Capital OperationDepartment. She served as Accountant, the Reporting Director and Capital Director in the FinanceDepartment of Shenzhen Chiwan Wharf Holdings Limited and Deputy Function Manager, FunctionManager in the Finance Management Department/Capital Operation Department of China MerchantsPort Group Co., Ltd. She has been a supervisor of the Company since May 2023.Tu Xiaoping, Chief Financial Officer, senior accountant, graduated from Shanghai MaritimeUniversity with a bachelor's degree in economics, majoring in financial accounting, and a master'sdegree in management from Zhongnan University of Economics and Law, majoring in administrationmanagement. He currently serves as the Chief Financial Officer of the Company, as well as anExecutive Director and the Chief Financial Officer of China Merchants Port Holdings CompanyLimited. He worked as accountant in Finance Division of Anhui Jianghai Transportation Company,Deputy Head of Finance Division of Anhui Ocean Shipping Co., Ltd., a clerk in the FinanceDepartment of Hong Kong Ming Wah Shipping Company Limited, Deputy Manager of the FinanceDepartment of China Merchants Group Cangma Transportation Co., Ltd., Manager of FinanceDepartment and Chief Financial Officer of China Merchants Real Estate Co., Ltd., Manager ofFinance Department of China Merchants Real Estate Group Co., Ltd., Chief Financial Officer andDeputy General Manager of Shenzhen Merchants Venture Co., Ltd., General Manager of FinanceDepartment, China Merchants Shekou Industrial Zone Co., Ltd., CFO, Deputy General Manager andParty Secretary of China Merchants Logistics Group Co., Ltd., General Manager and Deputy PartySecretary of China Yangtze Shipping Group Co., Ltd. He has served as the Chief Financial Officerof the Company since May 2021.Li Yubin, Deputy General Manager and Board Secretary, graduated from Tianjin University,majoring in Harbor and Cannel Engineering with the bachelor of engineering degree, Tianjin
University, majoring in engineering management, and obtained master’s degree. Later Li Yubingraduated from The University of Hong Kong and obtained doctor’s degree in real estate andconstruction. Li Yubin now serves as Deputy General Manager and Board Secretary of the Company,as well as Deputy General Manager of China Merchants Port Holdings Company Limited. Li Yubinused to be Deputy General Manager of Road and Bridge Project of China Harbor Company inBangladeshi Office, Project Director of Overseas Business Department of CHEC, Assistant GeneralManager of Planning and Commerce Department, R&D Department and Overseas BranchesDepartment of China Merchants Holdings (International) Company Limited, General Manager,Deputy General Economist of Strategy and Operation Management Department of China MerchantsPort Holdings Company Limited (CM Port Holdings) &General Manager and Chairman of the Boardof China Merchants Bonded Logistics Co., Ltd., the Chief Representative of Representative Officeof China Merchants Group in Djibouti, the Chief Digital Officer of China Merchants Port Group Co.,Ltd., and Vice Chairman of the Board of Tianjin Haitian Bonded Logistics Co,. Ltd. Li Yubin hasbeen the Deputy General Manager of the Company since December 2018 and the Board Secretary ofthe Company since April 2021.Liu Bin, Deputy General Manager, graduated from Zhongnan University of Economic and Lawwith a bachelor’s degree in economic law and a master’s degree in business management from DalianUniversity of Technology. He now serves as the Deputy General Manager of the Company andDeputy Chief Economist of China Merchants Port Holdings Company Limited. Mr. Liu has servedas the Deputy General Manager of Business Management Department, Ministry of Commerce andCorporate Strategy and Development Department and General Manager of AdministrationDepartment, Human Resource Department and Supervision Department in China Merchants PortHoldings Company Limited, Director and General Manager of Shenzhen Chiwan Wharf HoldingsLimited, and Director of Shenzhen Goodten Interlink Technology Co., Ltd. He serves as a DeputyGeneral Manager of the Company since September 2022.Li Wenbo, Deputy General Manager, Intermediate Economist, Engineer, graduated from theSchool of Mechanical Engineering, Hefei University of Technology, majoring in Mechanical Designand Manufacturing. He now serves as Deputy General Manager of the Company and Deputy General
Manager of China Merchants Port Holdings Company Limited. He served as the Assistant to theGeneral Manager/Director of the Human Resources Department of Sinotrans Limited, the DeputyDirector, Director, Assistant to the Head of the Personnel Department under the Human ResourcesDepartment of China Merchants Group Corporation Limited, and Director of PersonnelDepartment/Cadre Supervision Department, Assistant to the Director of the Human ResourcesDepartment and Director of Cadre Department, Deputy Director of the Human Resources Departmentand Director of Cadre Department. He has been the Deputy General Manager of the Company sinceAugust 2023.Zhu Weida, Deputy General Manager, holds a bachelor degree in engineering in ElectricalAutomation from the Department of Computer and Automation of Wuhan Institute of WaterTransportation Engineering and a master degree in engineering in mechanical engineering from theSchool of Automation, Wuhan University of Technology. Currently, he is Deputy General Managerof the Company. He served as Deputy General Manager of Beilun Ore Terminal under NingboZhoushan Port Company Limited, General Manager of Zhoushan Quhuang Port Development andConstruction Co., Ltd, General Manager of Zhoushan Shulanghu Terminal Co., Ltd, Director ofCorporate Management (Audit) Department and Comprehensive Supervision Department ofZhejiang Provincial Seaport Investment & Operation Group Co., Ltd and Ningbo Zhoushan PortGroup Co., Ltd.. He has been Deputy General Manager of the Company since April 2023.Liu Libing, General Counsel (Chief Compliance Officer), graduated from the Department ofPhilosophy, School of Philosophy, Wuhan University with a Bachelor in Philosophy. Later, hepursued further study at Sun Yat-sen University School of Law and obtained a Master of Laws.Currently, he serves as General Counsel and Chief Compliance Officer of the Company, Supervisorof Shanghai International Port (Group) Co., Ltd. He used to work as Publicity Secretary of thePolitical Work Department of China Construction Third Engineering Bureau, Deputy Secretary ofParty Branch (deputy section level) and Deputy Director of Party Committee Office of ShenzhenDecoration Design Engineering Co., Ltd. of China Construction Third Bureau, Production Supervisorof Shenzhen Foxconn (Group) Company, lawyer assistant and full-time lawyer at Shenzhen Office
of Shanghai City Development Law Firm, and full-time lawyer at Guangdong Sun LawFirm.Manager at the Legal Affairs Department and Senior Manager of China Merchants PropertyDevelopment Co., Ltd., Manager at the Legal Affairs Department of China Merchants Group Co.,Limited, Senior Manager at the Risk Management Department of China Merchants Group Co.,Limited, and Senior Manager of the General Office and head of the Secretariat of the Board ofDirectors at China Merchants Group Co., Limited. He has been the General Counsel of the Companysince August 2020. He has been the Chief Compliance Officer of the Company since August 2023.Offices held concurrently in shareholding entities:
□ Applicable √ Not applicable
Offices held concurrently in other entities:
Name
| Name | Other entity | Office held in the entity | Start of tenure | End of tenure | Remuneration or allowance from the entity |
| Feng Boming | China Merchants Group Co., Limited | Deputy General Manager | March 2022 | Yes | |
| Feng Boming | Liaoning Port Group Co., Ltd. | Chairman of the Board | August 2022 | No | |
| Feng Boming | China Merchants Energy Shipping Co., Ltd | Chairman of the Board | July 2023 | No | |
| Feng Boming | SINOTRANS&CSC Holdings Co.,Ltd. | Chairman of the Board | December 2023 | No | |
| Feng Boming | Sinotrans Limited | Chairman of the Board | August 2022 | July 2023 | No |
| Xu Song | Liaoning Port Co., Ltd. | Director | November 2021 | September 2023 | No |
| Xu Song | China Merchants Taiping Bay Development Investment Co., Ltd. | Director | July 2023 | No | |
| Xu Song | China Nanshan Development (Group) Incorporation | Director | September 2023 | No | |
| Xu Song | Shenzhen Chiwan Industrial Development Co. Ltd. | Director | September 2023 | No | |
| Lu Yongxin | Tin-can Island Container Terminal Ltd | Vice Chairman of the Board | July 2019 | No | |
| Lu Yongxin | Terminal Link S.A.S. | Director | March 2020 | No | |
| Li Zhanglin | China Merchants Group Co., Limited | Full-time outside directors assigned | December 2023 | Yes | |
| Li Zhanglin | China Merchants Expressway Network & Technology Holdings Co., Ltd. | Supervisor | March 2022 | No |
Li Qing
| Li Qing | China Merchants Group Co., Limited | Full-time outside directors assigned | December 2023 | Yes | |
| Li Qing | China Merchants Hainan Development & Investment Co., Ltd. | Director | June 2023 | No | |
| Wu Changpan | Zhejiang Provincial Seaport Investment & Operation Group Co., Ltd. | Director of Investment Development | September 2022 | Yes | |
| Wu Changpan | Ningbo Zhoushan Port Group Co., Ltd. | Director of Investment Development | September 2022 | Yes | |
| Wu Changpan | East Harbor Investment Development Group Co., Ltd. | Director | June 2017 | No | |
| Wu Changpan | Zhejiang Zhongao Modern Industrial Park Co., Ltd. | Director | April 2016 | No | |
| Wu Changpan | Zhejiang Zhidi Holdings Co., Ltd. | Director | August 2019 | No | |
| Wu Changpan | Zhejiang Aozhou Cattle Industry Co., Ltd | Director | September 2016 | No | |
| Lyu Yiqiang | Zhejiang Provincial Seaport Investment & Operation Group Co., Ltd. | Director of Production Safety Department | December 2021 | Yes | |
| Lyu Yiqiang | Ningbo Zhoushan Port Group Co., Ltd. | Director of Production Safety Department | December 2021 | Yes | |
| Lyu Yiqiang | Hangzhou Port Group Co., Ltd. | Director | June 2022 | No | |
| Lyu Yiqiang | Ningbo Electronic Port Co., Ltd. | Chairman of the Board | February 2023 | No | |
| Li Qi | Peking University | Associate Professor | August 2005 | Yes | |
| Li Qi | Guangdong Nanyue Bank Co.,Ltd. | Independent Director | November 2020 | Yes | |
| Li Qi | Shanghai Nagamori Machinery Co., Ltd. | Independent Director | July 2023 | Yes | |
| Zheng Yongkuan | Xiamen University | Professor | August 2019 | Yes | |
| Zheng Yongkuan | Civil Law Research Institute of China Law Society | Director | June 2017 | No | |
| Zheng Yongkuan | Civil and Commercial Law Research Institute of Fujian Law Society | Vice President | November 2020 | No | |
| Zheng Yongkuan | Xiamen Arbitration Commission | Arbitrator | April 2008 | No |
ZhengYongkuan
| Zheng Yongkuan | Quanzhou Arbitration Commission | Arbitrator | January 2019 | No | |
| Zheng Yongkuan | Fidelity Law Firm | Lawyer | December 2017 | No | |
| Zheng Yongkuan | Fujian Deer Technology Corp. | Independent Director | April 2022 | Yes | |
| Chai Yueting | Tsinghua University | Researcher | August 2001 | Yes | |
| Chai Yueting | General Expert Group of Modern Service Industry, Ministry of Science and Technology | Group Leader | May 2018 | No | |
| Chai Yueting | E-Commerce Standardization Work Group of Standardization Administration | Group Leader | August 2016 | No | |
| Chai Yueting | Expert Group of National E-Commerce Model City Creation Work Expert Advisory Committee | Group Leader | January 2015 | No | |
| Chai Yueting | Beijing Block Chain Expert Group | Member | June 2020 | No | |
| Chai Yueting | International Journal of Crowd Science | Editor | January 2017 | No | |
| Chai Yueting | Xinfang Shengshuzhi Technology Co., Ltd. | Independent Director | November 2022 | Yes | |
| Yang Yuntao | China Merchants Group Co., Limited | Minister of Risk Management Department/Legal Compliance Department/Audit Department | September 2021 | No | |
| Yang Yuntao | China Yangtze Shipping Group Co., Ltd. | Chairman of the Supervisory Committee | October 2021 | No | |
| Yang Yuntao | China Merchants Shekou Industrial Zone Holdings Co., Ltd. | Supervisor | March 2022 | No | |
| Yang Yuntao | China Merchants Expressway Network & Technology Holdings Co., Ltd. | Chairman of the Supervisory Committee | March 2022 | No | |
| Fu Bulin | China Merchants Group Co., Limited | Vice Minister of Audit Department | September 2017 | Yes | |
| Fu Bulin | China Yangtze Shipping Group Co., Ltd. | Supervisor | June 2023 | No | |
| Fu Bulin | Sinotrans Limited | Supervisor | July 2023 | No | |
| Fu Bulin | China Merchants Sharing Service Co. Ltd. | Supervisor | November 2021 | No | |
| Fu Bulin | China Merchants Investment Development Co., Ltd. | Supervisor | October 2022 | No | |
| Tu Xiaoping | China Nanshan Development (Group) Incorporation | Chairman of the Supervisory Committee | February 2022 | No |
TuXiaoping
| Tu Xiaoping | Shenzhen Chiwan Industrial Development Co. Ltd. | Chairman of the Supervisory Committee | February 2022 | No | |
| Tu Xiaoping | Shenzhen China Merchants Qianhai Industrial Development Co., L | Director | April 2022 | No | |
| Li Yubin | Silk Road Yishang Information Technology Co., Ltd. | Chairman of the Board | January 2019 | No | |
| Li Yubin | Shenzhen Gangteng Internet Technology Co., Ltd. | Chairman of the Board | January 2022 | No | |
| Li Yubin | Asia Airfreight Terminal Company Limited | Vice Chairman of the Board | December 2022 | No | |
| Li Yubin | Laos Vientiane Saysettha Operation and Management Co., Ltd. | Director | June 2022 | No | |
| Li Yubin | Tianjin Haitian Bonded Logistics Co., Ltd. | Vice Chairman of the Board | June 2022 | November 2023 | No |
| Li Yubin | Liaoning Port Co., Ltd. | Director | August 2023 | No | |
| Liu Bin | China Merchants Port International College SZPU Haisi College | President of the Council, President | October 2020 | No | |
| Liu Bin | SPIC Yuetong Qiyuan Core Power Technology Co., Ltd. | Director | July 2021 | No | |
| Liu Bin | Shenzhen Goodten Interlink Technology Co., Ltd. | Director | January 2022 | August 2023 | No |
| Li Wenbo | Tianjin Port Container Terminal Co., Ltd. | Director | August 2023 | No | |
| Liu Libing | Shanghai International Port (Group) Co., Ltd. | Supervisor | October 2022 | No | |
| Note | Offices of directors, supervisor, and senior management held concurrently in other entities exclude offices held in the Company and subsidiaries within the consolidation scope. | ||||
Punishments imposed in the recent three years by the securities regulator on the incumbent directors,supervisors and senior management as well as those who left in the Reporting Period:
□ Applicable √ Not applicable
3. Remuneration of Directors, Supervisors and Senior ManagementDecision-making procedure, determination basis and actual payments of remuneration for directors,supervisors and senior management:
Decision-making procedure for the remuneration of directors, supervisors and senior management:
Remunerations for the Company’s directors, supervisors and senior management shall be nominatedby the Board of Directors and determined upon review of the Remuneration and Appraisal Committee.Allowance for the 10
thIndependent Directors is RMB150,000/year (tax included), which has beenapproved at the 2019 Annual General Meeting. Allowance for the 11
thIndependent Directors is
RMB150,000/year (tax included), which has been approved at the 2022 Annual General Meeting.Determining basis for the remuneration of directors, supervisors and senior management: The modesand amounts of the remuneration for directors, supervisors and senior management are determinedaccording to the market levels with the post value, responsibilities, etc. taken into account.Actual payment for the remuneration of directors, supervisors and senior management: Salaries andindependent director allowances were paid to directors, supervisors and senior executives on amonthly basis. And the other bonuses were paid all at one time according to the performance of eachof them.Remuneration of directors, supervisors and senior management for the Reporting Period
Name
| Name | Gender | Age | Office title | Incumbent/Former | Total before-tax remuneration from the Company ( RMB’0,000) | Any remuneration from related party |
| Feng Boming | Male | 54 | Chairman of the Board | Incumbent | 0 | Yes |
| Xu Song | Male | 52 | Vice Chairman of the Board and CEO | Incumbent | 251 | No |
| Yan Gang | Male | 51 | Vice Chairman of the Board | Incumbent | 232 | No |
| Lu Yongxin | Male | 54 | Director, Chief Operation Officer, and General Manager | Incumbent | 223 | No |
| Li Zhanglin | Male | 57 | Director | Incumbent | 0 | Yes |
| Li Qing | Male | 54 | Director | Incumbent | 0 | Yes |
| Wu Changpan | Male | 54 | Director | Incumbent | 0 | Yes |
| Lyu Yiqiang | Male | 47 | Director | Incumbent | 0 | Yes |
| Gao Ping | Male | 68 | Independent director | Incumbent | 15 | No |
| Li Qi | Female | 53 | Independent director | Incumbent | 15 | No |
| Zheng Yongkuan | Male | 46 | Independent director | Incumbent | 15 | No |
| Chai Yueting | Male | 60 | Independent director | Incumbent | 15 | No |
| Yang Yuntao | Male | 57 | Chairman of the Supervisory Committee | Incumbent | 0 | Yes |
| Fu Bulin | Male | 52 | Supervisor | Incumbent | 0 | Yes |
| Xu Jia | Male | 42 | Supervisor | Incumbent | 68 | No |
LeiYuanyuan
| Lei Yuanyuan | Female | 34 | Supervisor | Incumbent | 30 | No |
| Tu Xiaoping | Male | 58 | CFO | Incumbent | 244 | No |
| Li Yubin | Male | 52 | Deputy General Manager, Board Secretary | Incumbent | 174 | No |
| Liu Bin | Male | 55 | Deputy General Manager | Incumbent | 198 | No |
| Li Wenbo | Male | 44 | Deputy General Manager | Incumbent | 43 | No |
| Zhu Weida | Male | 55 | Deputy General Manager | Incumbent | 0 | Yes |
| Liu Libing | Male | 50 | General Counsel (Chief Compliance Officer) | Incumbent | 165 | No |
| Deng Renjie | Male | 54 | Former Chairman of the Board | Former | 0 | Yes |
| Wang Xiufeng | Male | 53 | Former Vice Chairman of the Board and CEO | Former | 169 | No |
| Zhang Rui | Male | 58 | Former Director | Former | 0 | Yes |
| Liu Weiwu | Male | 59 | Former Director | Former | 0 | Yes |
| Gong Man | Female | 35 | Former Supervisor | Former | 37 | No |
| Total | -- | -- | -- | -- | 1,894 | -- |
Other notes
□ Applicable √ Not applicable
VI Performance of Duty by Directors in the Reporting Period
1. Board Meeting Convened during the Reporting Period
| Meeting | Date of the meeting | Disclosure date | Meeting resolutions |
| The 1st Extraordinary Meeting of the 10th Board of Directors in 2023 | 19 January 2023 | 20 January 2023 | The meeting deliberated on and passed: 1. Proposal on Adjusting the Exercise Prices of the Stock Option Incentive Plan (Phase I) of the Company 2. Proposal on Adjusting the Numbers of Qualified Awardees and Stock Options to Be Granted of the Stock Option Incentive Plan (Phase I) of the Company 3. Proposal on the Failure to Meet the Exercise Conditions for the Second Exercise Schedule of the Stock Options (the First Batch to be Granted) under the Company’s Stock Option Incentive Plan (Phase I) 4. Proposal on the Failure to Meet the Exercise Conditions for the First Exercise Schedule of the Stock Options (the Reserved Batch to be Granted) under the Company’s Stock Option Incentive Plan (Phase I) |
5. Proposal on Cancelling Some Stock Options under the Company’s StockOption Incentive Plan (Phase I)
6. Proposal on the Formulation of the Management Measures for theRemuneration of Management Members
7. Proposal on the Formulation of the Management Measures forProfessional Managers
8. Proposal on the Formulation of the Management Measures for TermSystem and Contractual Management
9. Proposal on the Revision of the Management Measures for Donations toExternal Beneficiaries
10. Proposal on the Formulation of Liabilities Management System
| 5. Proposal on Cancelling Some Stock Options under the Company’s Stock Option Incentive Plan (Phase I) 6. Proposal on the Formulation of the Management Measures for the Remuneration of Management Members 7. Proposal on the Formulation of the Management Measures for Professional Managers 8. Proposal on the Formulation of the Management Measures for Term System and Contractual Management 9. Proposal on the Revision of the Management Measures for Donations to External Beneficiaries 10. Proposal on the Formulation of Liabilities Management System | |||
| The 2nd Extraordinary Meeting of the 10th Board of Directors in 2023 | 20 March 2023 | 21 March 2023 | The meeting deliberated on and passed: Proposal on the Public Transfer of 45% of CMICT’s Equity by the Majority-Owned Subsidiary |
| The 7th Meeting of the 10th Board of Directors | 31 March 2023 | 4 April 2023 | The meeting deliberated on and passed: 1. Proposal on the 2022 Report on the Work of the Board of Directors 2. Proposal on the 2022 Report on Business Operations 3. Proposal on the 2022 Report on Financial Accounts 4. Proposal on the Company’s Shareholder Return Plan for the Three Years (2022-2024) 5. Proposal on the 2022 Profit Distribution and Dividend Payout Plan 6. Proposal on the Annual Report 2022 and Abstract 7. Proposal on the 2022 Report on Sustainable Development 8. Proposal on the 2022 Annual Internal Control Evaluation Report 9. Proposal on Anti-fraud Risk Assessment Report for 2022 10. Proposal on the 2022 Inspection Report on the Provision of Guarantees, Related-Party Transactions, Securities Investment and Derivatives Transactions and the Provision of Financial Assistance 11. Proposal on the 2022 Law-Based Development Report (including the Report on the Development of the Compliance Management System) 12. Proposal on the 2023 Investment Plan 13. Proposal on the 2023 Report on Donation Budget 14. Proposal on the Company’s Five-Year Strategic Plan for 2023-2027 15. Proposal on the Confirmation of the Continuing Related-Party Transactions in 2022 and the Estimation of Such Transactions in 2023 16. Proposal on Business at China Merchants Bank Such as Deposits and Loans and Related-Party Transactions in 2023 |
17. Proposal on Confirming External Guarantee Progress of the Company in
2022 and the Expected New External Guarantee Line in the Next 12 Months
18. Proposal on Bank Credit Line and Financing Plan for FinancialInstitutions in 2023
19. Proposal on Reviewing the General Authorization of the Company to Issue
Bond Products
20. Proposal on the Risk Assessment Report of China Merchants GroupFinance Co., Ltd. Dated 31 December 2022
21. Proposal on the Special Report on Deposit and Usage of Raised Fund in
2022
22. Proposal on Renewal of Appointment of Accounting Firm for 2023
23. Proposal on the Renewal of Liability Insurance for Directors, Supervisors
and Senior Management
24. Proposal on the Election of the Board of Directors
25. Proposal on the Nomination of Independent Director Candidates
26. Proposal on the Allowance and Expense of Independent Directors
| 17. Proposal on Confirming External Guarantee Progress of the Company in 2022 and the Expected New External Guarantee Line in the Next 12 Months 18. Proposal on Bank Credit Line and Financing Plan for Financial Institutions in 2023 19. Proposal on Reviewing the General Authorization of the Company to Issue Bond Products 20. Proposal on the Risk Assessment Report of China Merchants Group Finance Co., Ltd. Dated 31 December 2022 21. Proposal on the Special Report on Deposit and Usage of Raised Fund in 2022 22. Proposal on Renewal of Appointment of Accounting Firm for 2023 23. Proposal on the Renewal of Liability Insurance for Directors, Supervisors and Senior Management 24. Proposal on the Election of the Board of Directors 25. Proposal on the Nomination of Independent Director Candidates 26. Proposal on the Allowance and Expense of Independent Directors | |||
| The 3rd Extraordinary Meeting of the 10th Board of Directors in 2023 | 6 April 2023 | 7 April 2023 | The meeting deliberated on and passed: Proposal on the Related-Party Transaction Regarding Conducting Financial Leasing between Majority-owned Subsidiaries and Related Parties |
| The 4th Extraordinary Meeting of the 10th Board of Directors in 2023 | 28 April 2023 | 29 April 2023 | The meeting deliberated on and passed: 1. Proposal on the First Quarter Report 2023 2. Proposal on the Extension of Financial Assistance Provided by Majority-owned Subsidiaries 3. Proposal on the Extension of Financial Assistance Provided by Majority-owned Subsidiaries and Related-Party Transactions to their Equity-participating Companies 4. Proposal on the Appointment of Mr. Zhu Weida as Deputy General Manager 5. Proposal on the Schedule and Agenda of the 2022 Annual General Meeting |
| The 1st Extraordinary Meeting of the 11th Board of Directors in 2023 | 14 July 2023 | 15 July 2023 | The meeting deliberated on and passed: 1. Proposal on the Appointment of Senior Management 2. Proposal on the Appointment of Securities Affairs Representative 3. Proposal on the Adjustment of a Partially-owned Subsidiary’s Related-party Guarantee for Its Equity-participating Company 4. Proposal on the By-election of Director 5. Proposal on the Schedule and Agenda of the First Extraordinary General Meeting in 2023 |
The 2
nd
ExtraordinaryMeeting of the
thBoard ofDirectors in2023
| The 2nd Extraordinary Meeting of the 11th Board of Directors in 2023 | 31 July 2023 | 1 August 2023 | The meeting deliberated on and passed: 1. Proposal on the Election of Chairman and Vice Chairman of the 11th Board of Directors 2. Proposal on the Election of Members of Audit Committee of the 11th Board of Directors 3. Proposal on the Election of Members of Nomination, Remuneration and Appraisal Committee of the 11th Board of Directors 4. Proposal on the Election of Members of Strategy and Sustainable Development Committee of the 11th Board of Directors 5. Proposal on the Convener of Audit Committee of the 11th Board of Directors 6. Proposal on the Convener of Nomination, Remuneration and Appraisal Committee of the 11th Board of Directors 7. Proposal on the Convener of Strategy and Sustainable Development Committee of the 11th Board of Directors |
| The 3rd Extraordinary Meeting of the 11th Board of Directors in 2023 | 16 August 2023 | 17 August 2023 | The meeting deliberated on and passed: 1. Proposal on the Appointment of Deputy General Manager 2. Proposal on the Appointment of Chief Compliance Officer |
| The 1st Meeting of the 11th Board of Directors | 29 August 2023 | 31 August 2023 | The meeting deliberated on and passed: 1. Proposal on the Semi-Annual Report 2023 and Abstract 2. Proposal on the Risk Assessment Report of China Merchants Group Finance Co., Ltd. Dated 30 June 2023 3. Proposal on the Special Report on Deposit and Usage of Raised Fund in H1 2023 4. Proposal on Inspection Report on the Provision of Guarantees, Related-Party Transactions, Securities Investment and Derivatives Transactions and the Provision of Financial Assistance for H1 2023 |
| The 4th Extraordinary Meeting of the 11th Board of Directors in 2023 | 26 September 2023 | 26 September 2023 | The meeting deliberated on and passed: Proposal on the Transfer and Acquisition of Equity Interests in Relevant Subsidiaries and Related-party Transactions |
| The 5th Extraordinary Meeting of the 11th Board of Directors in 2023 | 25 October 2023 | 26 October 2023 | The meeting deliberated on and passed: 1. Proposal on the Third Quarter Report 2023 2. Proposal on Amending the Articles of Association of the Company 3. Proposal on Revising the Rules of Procedure for the Board of Directors 4. Proposal on Revising the Working System for Independent Directors 5. Proposal on Revising the Working Articles of Audit Committee of the Board of Directors |
6. Proposal on Revising the Working Articles of Nomination, Remunerationand Appraisal Committee of the Board of Directors
7. Proposal on Revising the Working Articles of Strategy and SustainableDevelopment Committee of the Board of Directors
8. Proposal on Revising the Working Articles of Chief Executive Officer
9. Proposal on Revising the Management System of Investors’ Relations
10. Proposal on Revising the Measures for Appraising the BusinessPerformance of Management Members
11. Proposal on Convening the Company’s 2nd Extraordinary GeneralMeeting in 2023
| 6. Proposal on Revising the Working Articles of Nomination, Remuneration and Appraisal Committee of the Board of Directors 7. Proposal on Revising the Working Articles of Strategy and Sustainable Development Committee of the Board of Directors 8. Proposal on Revising the Working Articles of Chief Executive Officer 9. Proposal on Revising the Management System of Investors’ Relations 10. Proposal on Revising the Measures for Appraising the Business Performance of Management Members 11. Proposal on Convening the Company’s 2nd Extraordinary General Meeting in 2023 | |||
| The 6th Extraordinary Meeting of the 11th Board of Directors in 2023 | 28 December 2023 | 29 December 2023 | The meeting deliberated on and passed: 1. Proposal on Revising the Rules of Procedures for Office Meeting 2. Proposal on the Results of Performance Appraisal of Management Members for 2022 and Remuneration Encashment Programme |
2. Attendance of Directors at Board Meetings and General Meetings
| Attendance of directors at board meetings and general meetings | |||||||
| Director | Total number of board meetings the director was eligible to attend | Board meetings attended on site | Board meetings attended by telecommunication | Board meetings attended through a proxy | Board meetings the director failed to attend | The director failed to attend two consecutive board meetings (yes/no) | General meetings attended |
| Feng Boming | 7 | 3 | 4 | 0 | 0 | No | 2 |
| Xu Song | 12 | 4 | 8 | 0 | 0 | No | 3 |
| Yan Gang | 12 | 3 | 9 | 0 | 0 | No | 3 |
| Zhang Rui | 12 | 3 | 9 | 0 | 0 | No | 3 |
| Liu Weiwu | 12 | 3 | 9 | 0 | 0 | No | 3 |
| Lu Yongxin | 7 | 3 | 4 | 0 | 0 | No | 2 |
| Wu Changpan | 12 | 0 | 12 | 0 | 0 | No | 3 |
| Lyu Yiqiang | 12 | 0 | 12 | 0 | 0 | No | 3 |
| Gao Ping | 12 | 3 | 9 | 0 | 0 | No | 3 |
| Li Qi | 12 | 4 | 8 | 0 | 0 | No | 3 |
| Zheng Yongkuan | 12 | 4 | 8 | 0 | 0 | No | 3 |
| Chai Yueting | 12 | 4 | 8 | 0 | 0 | No | 3 |
| Deng Renjie | 5 | 1 | 4 | 0 | 0 | No | 1 |
| Wang Xiufeng | 5 | 1 | 4 | 0 | 0 | No | 1 |
Why any director failed to attend two consecutive board meetings:
None
3. Objections Raised by Directors on Matters of the Company
Indicate by tick mark whether any directors raised any objections on any matter of the Company.
□ Yes √ No
No such cases in the Reporting Period.
4. Other Information about the Performance of Duty by DirectorsIndicate by tick mark whether any suggestions from directors were adopted by the Company.
√ Yes □ No
Specification of whether suggestions from directors are adopted or not adopted by the CompanyDuring the Reporting Period, all the directors of the Company carried out their work conscientiouslyand responsibly in strict accordance with the Company Law, Securities Law, Listed CompanyGovernance Standards, Self-Regulatory Guidelines No. 1 for Companies Listed on Shenzhen StockExchange - Standard Operation of Listed Companies on the Main Board, Articles of Association andRules of Procedure of the Board of Directors. Based on the Company's reality, they put forwardrelevant opinions on the Company's major governance and operation decisions, and reachedconsensus through full communication and discussion. They resolutely supervised and promoted theimplementation of the resolutions of the Board of Directors to ensure scientific, timely and efficientdecision-making and fully safeguard the legitimate rights and interests of the Company and allshareholders.VII Performance of Duty by Specialized Committees under the Board in the Reporting Period
Committee
| Committee | Member | Nu | Date of the meeting | Meeting | Contents | Other | Details |
Profile of Specialized Committee under the Board as at the end of the period
| Profile of Specialized Committee under the Board as at the end of the period | |||
| No. | Specialized Committee | Member | Convener |
| 1 | Strategy and Sustainable Development Committee | Feng Boming, Xu Song, Yan Gang, Li Zhanglin, Li Qing, Lu Yongxin, Gao Ping, Li Qi, Chai Yueting | Feng Boming |
| 2 | Audit Committee | Li Qi, Chai Yueting, Zheng Yongkuan | Li Qi |
| 3 | Nomination, Remuneration and Evaluation Committee | Gao Ping, Feng Boming, Zheng Yongkuan | Gao Ping |
mberofmeetingsconvened
| mber of meetings convened | information about the performance of duty | about matters with objections (if any) | |||||
| The 10th Strategy and Sustainable Development Committee | Deng Renjie, Wang Xiufeng, Yan Gang, Zhang Rui, Xu Song, Gao Ping, Li Qi, Chai Yueting | 1 | 30 March 2023 | The 1st Meeting of the Strategy Committee of the 10th Board of Directors for 2023 | The meeting reviewed: 1. Proposal on the Report on Performance of Duty by the Strategy and Sustainable Development Committee of the Board of Directors in 2022 2. Proposal on the 2022 Report on Sustainable Development 3. Proposal on the Company’s Five-Year Strategic Plan for 2023-2027 | Unanimous vote | None |
| The 11th Strategy and Sustainable Development Committee | Feng Boming, Xu Song, Yan Gang, Zhang Rui, Lu Yongxin, Gao Ping, Li Qi, Chai Yueting | 1 | 31 July 2023 | The 1st Meeting of the Strategy Committee of the 11th Board of Directors for 2023 | The meeting reviewed: Proposal on the Election of Convener of Strategy and Sustainable Development Committee of the 11th Board of Directors and Confirmation of the Head of Investment Review Team | Unanimous vote | None |
| Audit Committee of the Board of Directors | Li Qi, Liu Weiwu, Zheng Yongkuan | 6 | 30 March 2023 | The 1st Meeting of the Audit Committee of the 10th Board of Directors for 2023 | The meeting reviewed: 1. Proposal on the Report on Performance of Duty by the Audit Committee of the Board of Directors in 2022 2. Proposal on Work Report of Accounting Firm for 2022 3. Proposal on the Financial Report of 2022 | Unanimous vote | None |
4. Proposal on Renewal of Appointment
of Accounting Firm for 2023
5. Proposal on Anti-fraud Risk
Assessment Report for 2022
6. Proposal on Internal Auditing Report
for 2022
7. Proposal on Internal Auditing Plan
for 2023
8. Proposal on Inspection Report on
Deposit and Usage of Raised Fund in2022
9. Proposal on Inspection Report on the
Provision of Guarantees, Related-PartyTransactions, Securities Investment andDerivatives Transactions and theProvision of Financial Assistance for2022
10. Proposal on the 2022 Law-Based
Development Report (including theReport on the Development of theCompliance Management System)
| 4. Proposal on Renewal of Appointment of Accounting Firm for 2023 5. Proposal on Anti-fraud Risk Assessment Report for 2022 6. Proposal on Internal Auditing Report for 2022 7. Proposal on Internal Auditing Plan for 2023 8. Proposal on Inspection Report on Deposit and Usage of Raised Fund in 2022 9. Proposal on Inspection Report on the Provision of Guarantees, Related-Party Transactions, Securities Investment and Derivatives Transactions and the Provision of Financial Assistance for 2022 10. Proposal on the 2022 Law-Based Development Report (including the Report on the Development of the Compliance Management System) | ||||
| 28 April 2023 | The 2nd Meeting of the Audit Committee of the 10th Board of Directors for 2023 | The meeting reviewed: 1. Proposal on Internal Audit Report for the First Quarter of 2023 2. Proposal on Inspection Report on Deposit and Usage of Raised Fund in the First Quarter of 2023 | Unanimous vote | None |
| 31 July 2023 | The 1st Meeting of the Audit Committee of the 11th Board of Directors for 2023 | The meeting reviewed: Proposal on the Election of Convener of Audit Committee of the 11th Board of Directors and the Confirmation of Contact of Working Group | Unanimous vote | None |
| 29 August 2023 | The 2nd Meeting of the Audit Committee of the 11th Board of Directors for 2023 | The meeting reviewed: 1. Proposal on Financial Report for H1 2023 2. Proposal on Internal Audit Report for the Second Quarter of 2023 3. Proposal on Inspection Report on Deposit and Usage of Raised Fund in H1 2023 4. Proposal on Inspection Report on the Provision of Guarantees, Related-Party Transactions, Securities Investment and Derivatives Transactions and the | Unanimous vote | None |
Provision of Financial Assistance forH1 2023
| Provision of Financial Assistance for H1 2023 | |||||||
| 25 October 2023 | The 3rd Meeting of the Audit Committee of the 11th Board of Directors for 2023 | The meeting deliberated on and passed: 1. Proposal on the Third Quarter Report 2023 2. Proposal on Internal Audit Report for the Third Quarter of 2023 3. Proposal on Inspection Report on Deposit and Usage of Raised Fund in the Third Quarter of 2023 4. Proposal on the Selection of Accounting Firm for 2024 | Unanimous vote | None | |||
| 29 December 2023 | The 4th Meeting of the Audit Committee of the 11th Board of Directors for 2023 | Meet with accountants to negotiate the schedule for the audit of the 2023 Annual Financial Report | Meeting and communication with accountants | None | |||
| The 10th Nomination, Remuneration and Evaluation Committee of the Board of Directors | Gao Ping, Deng Renjie, Zheng Yongkuan | 3 | 19 January 2023 | The 1st Meeting of the Nomination, Remuneration and Evaluation Committee of the 10th Board of Directors for 2023 | The meeting reviewed: 1. Proposal on the Formulation of the Management Measures for the Remuneration of Management Members 2. Proposal on the Formulation of the Management Measures for Professional Managers 3. Proposal on the Formulation of the Management Measures for Term System and Contractual Management | Unanimous vote | None |
| 30 March 2023 | The 2nd Meeting of the Nomination, Remuneration and Evaluation Committee of the 10th Board of Directors for 2023 | The meeting reviewed: 1. Proposal on Report on Performance of Duty by the Nomination, Remuneration and Appraisal Committee of the Board of Directors in 2022 2. Proposal on the Remuneration of Directors, Supervisors and Senior Management in 2022 3. Proposal on the Inspection of Director Candidates 4. Proposal on the Allowance and Expense of Independent Directors | Unanimous vote | None |
28 April 2023
| 28 April 2023 | The 3rd Meeting of the Nomination, Remuneration and Evaluation Committee of the 10th Board of Directors for 2023 | The meeting reviewed: Proposal on the Appointment of Mr. Zhu Weida as Deputy General Manager | Unanimous vote | None | |||
| The 11th Nomination, Remuneration and Evaluation Committee of the Board of Directors | Gao Ping, Feng Boming, Zheng Yongkuan | 4 | 31 July 2023 | The 1st Meeting of the Nomination, Remuneration and Evaluation Committee of the 11th Board of Directors for 2023 | The meeting reviewed: Proposal on the Election of Convener of Nomination, Remuneration and Appraisal Committee of the 11th Board of Directors and the Confirmation of Head of Working Group | Unanimous vote | None |
| 16 August 2023 | The 2nd Meeting of the Nomination, Remuneration and Evaluation Committee of the 11th Board of Directors for 2023 | The meeting reviewed: 1. Proposal on the Appointment of Deputy General Manager 2. Proposal on the Appointment of Chief Compliance Officer | Unanimous vote | None | |||
| 25 October 2023 | The 3rd Meeting of the Nomination, Remuneration and Evaluation Committee of the 11th Board of Directors for 2023 | The meeting reviewed: Proposal on Revising the Measures for Appraising the Business Performance of Management Members | Unanimous vote | None | |||
| 28 December 2023 | The 4th Meeting of the Nomination, Remuneration and Evaluation Committee of the 11th Board of Directors for 2023 | The meeting reviewed: Proposal on the Results of Performance Appraisal of Management Members for 2022 and Remuneration Encashment Programme | Unanimous vote | None |
VIII Performance of Duty by the Supervisory CommitteeIndicate by tick mark whether the Supervisory Committee found any risk to the Company during itssupervision in the Reporting Period.
□ Yes √ No
The Supervisory Committee raised no objections in the Reporting Period.
IX Employees
1. Number, Functions and Educational Backgrounds of Employees
Number of in-service employees of theCompany as the parent as at the end of theperiod
| Number of in-service employees of the Company as the parent as at the end of the period | 303 |
| Number of in-service employees of major subsidiaries as at the end of the period | 14,147 |
| Total number of in-service employees | 14,450 |
| Total number of paid employees in the Reporting Period | 15,315 |
| Number of retirees to whom the Company as the parent or its major subsidiaries need to pay retirement pensions | 9,659 |
| Functions | |
| Function | Employees |
| Production | 7,769 |
| Sales | 545 |
| Technical | 3,044 |
| Financial | 524 |
| Administrative | 2,568 |
| Total | 14,450 |
| Educational backgrounds | |
| Educational background | Employees |
| Master’s degree and above | 554 |
| Bachelor’s degree | 3,921 |
| Junior college | 3,682 |
| Technical secondary school and below | 6,293 |
| Total | 14,450 |
2. Employee Remuneration Policy
In 2023, in the face of the severe external situation and a series of risks and challenges, the Company,in line with the general principle of seeking progress while maintaining stability and made everyeffort to implement development measures. Through continuous optimization of the remunerationincentive mechanism, the Company promoted the in-depth integration of human efficiencyenhancement and business development, boosting its high-quality development.The Company optimized revenue distribution mechanism, launched benchmarking of performanceand remuneration, improved remuneration strategy at the appropriate time, and enhanced theefficiency of resource allocation. Efforts were made to improve the diversified incentive system bycombining short-term and medium- and long-term incentives, equity incentives and cash-basedincentives, to create a mechanism for employees and the Company to share benefits and risks. The
Company adopted targeted incentives by stratification and classification, supported by theimprovement in performance appraisal and incentive mechanism, adhered to the concept ofperformance-oriented market-based income distribution, and strengthened the connection withappraisal. The Company continuously and effectively play the role of remuneration incentives byestablishing a dynamic remuneration adjustment mechanism linked to the appraisal. Theremuneration distribution policy is more favourable to the excellent team and outstanding employeeswho create value, talents who make remarkable contributions and the difficult, dirty, dangerous, andtiring front-line positions, as well as technology innovation talents and value creators.Based on the principles of internationalization, localization and being market-oriented, the Companybuilt an international talent incentive system combining differentiated management and all-roundprotection, ensuring the effective operation of the management mode featuring “professionalisedlong-term assignment, policy-based short-term assignment, and young reserve talents”. It exploredthe development of incentive mechanism for a technology-based enterprise, introduced specialincentive measures for technology innovation talents, and strengthened the incentive orientation ofvalue creation based on knowledge, technology and other innovation elements, providing policysupport and system guarantee for technology innovation. The Company focused on the establishmentof a long-term incentive mechanism, explored the feasibility of phased implementation of the equityincentive plan and the applicability of medium- and long-term incentive instruments. Based on this,it actively advanced medium- and long-term incentive plans for Senior Management and keyemployees, effectively mobilizing motivation and creativity and injecting vitality into it.
3. Employee Training Plans
In 2023, the Company vigorously planned and implemented various talent development projects witha focus on its talent development strategies and business development needs. It also established ateam of high-quality internal trainers and developed high-quality courses. The above measures helpedcultivate young cadres with excellent professional ability, innovative spirit and global vision, thusboosting the talent building of the Company.First, the Company continued to carry out the youth cadre class project, strengthened the industry’sinternal course training system, and organized 115 young cadres to study and explore port-relatedbusiness in depth. Through a series of leadership course training such as non-authority influence andcomprehensive communication, the Company improved the comprehensive management ability in atargeted manner, and helped to build high-quality young cadres who are proficient in business, goodat management, and have a global vision.
Second, its overseas strategies were actively promoted and its digitalised strategies implemented. Toexpand the Company’s overseas business, thematic seminars and external resource empowermentwere carried out in order to conduct targeted training projects. It invited professional professors fromkey national institutions to give lectures and exchange ideas, and organised overseas political,economic and cultural courses, enhancing the staff’s understanding of cross-culture communicationand their ability to communicate and collaborate with partners with different cultural backgrounds.In addition, the Company invited its experts in digitalisation to conduct internal training to deepenemployees’ understanding of digitally-enabled business and to enhance their awareness of digitalsecurity.Third, it continued to improve the quality of internal trainers and expand the size of the team. In 2023,the Company launched the third phase of its trainer training project, and established a long-termeffective mechanism to encourage more managers and business experts to join in the ranks of internaltrainers. Through course review and teaching in lieu of training, 30 new internal trainers were addedand 30 high-quality courses were released. At the same time, the Company effectively leveraged thesynergy of training, and sent more quality internal training courses to subordinate companies,ensuring the sharing of high-quality training resources to benefit more employees.
4. Labor Outsourcing
Total man-hours (hour)
| Total man-hours (hour) | N/A |
| Total remuneration paid (RMB) | 1,204,882,561.08 |
X Final Dividend Plan of the Company for the Reporting Period
1. Formulation, execution or adjustments of profit distribution policy for shareholders,especially cash dividend policy, in the Reporting PeriodPursuant to the CSRC Guideline for Listed Companies No.3-Cash Dividends of Listed Companiesand the Notice of CSRC on Further Implementing Matters Related to Cash Dividends of ListedCompanies, the Articles of Association clarifies the specific profit distribution policy, decision-making procedures and mechanism, adjustment of profit distribution policy, implementation of profitdistribution plan, and profit distribution for foreign shares. During the Reporting Period, the Companyexecuted the profit distribution policy in strict compliance with the Articles of Association.
| Special statement about the cash dividend policy | |
| In compliance with the Company’s Articles of Association and resolution of general meeting | Yes |
| Specific and clear dividend standard and ratio | Yes |
| Complete decision-making procedure and mechanism | Yes |
Independent directors faithfully performed their dutiesand played their due role
| Independent directors faithfully performed their duties and played their due role | Yes |
| Specific reasons and the next steps it intends to take to enhance the investor return level if the Company has not made cash dividend: | Not applicable |
| Non-controlling interests are able to fully express their opinion and desire and their legal rights and interests are fully protected | Yes |
| In case of adjusting or changing the cash dividend policy, the conditions and procedures involved are in compliance with applicable regulations and transparent | Not applicable |
2. The Company was profitable in the Reporting period and the positive profits of the Companyas the parent attributable to shareholders while the distribution plan of cash dividend forshareholders was not proposed.? Applicable √ Not applicable
3. Final Dividend Plan for the Reporting Period
| Bonus shares/10shares (share) | 0 |
| Cash dividend/10 shares (RMB) (tax inclusive) | 5.8 |
| Bonus issue from capital reserves (share/10 shares) | 0 |
| Share base (share) | 2,499,462,404 |
| Total cash dividends (RMB) (tax inclusive) | 1,449,688,194.32 |
| Cash dividends in other forms (such as share repurchase) (RMB) | 0.00 |
| Total cash dividends (including other forms) (RMB) | 1,449,688,194.32 |
| Distributable profits (RMB) | 1,999,000,567.57 |
| Cash dividends (including other forms) as % of total profits to be distributed (%) | 100% |
| Details of the cash dividends | |
| As the Company is in the mature stage of development with significant capital expenditures arrangement, when distributing profits, the proportion of cash dividends in this profit distribution shall be 40% at least. | |
| Details of final dividend plan for the Reporting Period | |
| As audited by Deloitte Touche Tohmatsu Certified Public Accountants LLP, the consolidated net profit attributable to the Company as the parent for 2023 stood at RMB3,571,800,762.16 and the net profit of the Company as the parent at RMB940,631,145.26. (1) According to the Company Law and the Articles of Association of the Company, when distributing the current year's after-tax profits, the Company shall draw 10% of the profits for the company's statutory reserve fund. This withdrawal of surplus reserve for the Company is RMB94,063,114.53. The accumulative distributable profit of the Company as the parent at the end of 2023 was RMB1,999,000,567.57. (2) Base on the latest total 2,499,462,404 shares, a cash dividend of RMB5.80 (tax included) is to be distributed for every 10 shares, totalling RMB1,449,688,194.32, with no bonus issue from either profit or capital reserves. After the above-mentioned distribution, the retained earnings of the Company as the parent will be RMB549,312,373.25. If there is a change in the total share capital of the company during the period from the disclosure of the distribution plan to its implementation due to the listing of new shares, the grant and exercise of equity incentives, convertible bonds to shares conversion, share repurchases, etc., the total distribution amount for the year 2023 will be adjusted accordingly based on the principle that the distribution amount per share remains unchanged. The above profit distribution plan still needs to be submitted to the 2023 Annual General Meeting for approval. | |
XI Equity Incentive Plans, Employee Stock Ownership Plans or Other Incentive Measures forEmployees
1. Equity incentive
The Company’s review and approval procedures carried out in connection with the Stock OptionIncentive Plan are as follows:
(1) The 1st Extraordinary Meeting of the 10th Board of Directors in 2023 and 1st ExtraordinaryMeeting of the 10th Supervisory Committee in 2023 of the Company, held on 19 January 2023,reviewed and approved the Proposal on Adjusting the Exercise Prices of the Stock Option IncentivePlan (Phase I) of the Company, the Proposal on Adjusting the Numbers of Qualified Awardees andStock Options to Be Granted of the Stock Option Incentive Plan (Phase I) of the Company, theProposal on the Failure to Meet the Exercise Conditions for the Second Exercise Schedule of theStock Options (the First Batch to be Granted) of the Stock Option Incentive Plan (Phase I) of theCompany, the Proposal on the Failure to Meet the Exercise Conditions for the First Exercise Scheduleof the Stock Options (the Reserved Portion) of the Stock Option Incentive Plan (Phase I) of theCompany, and the Proposal on Cancelling Some Stock Options in the Stock Option Incentive Plan(Phase I) of the Company.. Independent directors gave independent opinions of agreement. TheSupervisory Committee of the Company verified the proposals and gave opinions. For details, see therelevant announcements disclosed by the Company on Cninfo (www.cninfo.com.cn) (AnnouncementNo. 2023-005, 2023-006, 2023-007, 2023-008 and 2023-009).
(2) On 7 February 2023, upon the review and confirmation of Shenzhen Branch of China SecuritiesDepository and Clearing Corporation Limited, the Company completed the cancellation of somestock options in the stock option incentive plan (phase I). For more details, please refer to theAnnouncement on Completing the Cancellation of Some Stock Options in the Stock Option IncentivePlan (Phase I) of the Company (Announcement No. 2023-010) disclosed by the Company on Cninfo(www.cninfo.com.cn).Equity Incentives for Directors and Senior Management
Name
| Name | Office title | Share options held at the period-begin | Share options granted in the Reporting Period | Shares feasible to exercise during the Reporting Period | Shares exercised during the Reporting Period | Exercise price of exercised shares during the Reporting Period (RMB/share) | Share options held at the period-end | Market price at the period-end (RMB/share) | Number of restricted shares held at the period-begin | Number of released shares for the Reporting Period | Number of restricted shares newly granted during the Reporting Period | The grant price of restricted shares (RMB/share) | Number of restricted shares held at the period-end |
| Xu Song | Vice Chairman | 240,000 | - | - | - | - | 120,000 | - | - | - | - | - | - |
oftheBoard andCEO
| of the Board and CEO | |||||||||||||
| Yan Gang | Vice Chairman of the Board | 102,000 | - | - | - | - | 51,000 | - | - | - | - | - | - |
| Lu Yongxin | Chief Operation Officer, and General Manager | 144,000 | - | - | - | - | 72,000 | - | - | - | - | - | - |
| Li Yubin | Deputy General Manager, and Board Secretary | 144,000 | - | - | - | - | 72,000 | - | - | - | - | - | - |
| Liu Bin | Deputy General Manager | 60,000 | - | - | - | - | 30,000 | - | - | - | - | - | - |
| Liu Libing | General Counsel (Chief Compliance Officer) | 50,000 | - | - | - | - | 25,000 | - | - | - | - | - | - |
| Total | -- | 740,000 | - | - | - | -- | 370,000 | -- | - | - | - | -- | - |
| Remark (if any) | On 7 February 2023, upon the review and confirmation of Shenzhen Branch of China Securities Depository and Clearing Corporation Limited, the Company completed the cancellation of above stock options. 120,000 shares, 51,000 shares, 72,000 shares, 72,000 shares, 30,000 shares and 25,000 shares of share options respectively held by Mr. Xu Song, Mr. Yan Gang, Mr. Lu Yongxin, Mr. Li Yubin, Mr. Liu Bin and Mr. Liu Libing had been cancelled | ||||||||||||
Appraisal of and Incentive for Senior ManagementIn 2023, the Company continuously carried out the tenure system and contractual management,
realized comprehensive coverage and adhered to rigid remuneration realization. The Company has amature assessment mechanism and system covering all senior management personnel. The annualcomprehensive assessment combines qualitative and quantitative methods with the dimensionsincluding performance, competence, self-discipline, etc. The assessment results of seniormanagement serve as an important basis for appointment and motivation. The Company adjusts anddetermines the post salary of senior management based on the factors including operation status,position served and assessment results, and determines the performance bonus of senior managementthrough the factors including annual comprehensive ability assessment, annual key performanceindicators appraisal and three-year strategic appraisal results.The performance-based bonus scheme for Senior Management members was optimized based on thedistinctive principle of “outperforming the market and the peers”, through the comparison withthemselves and benchmarking with their peers and the complementation of short-term KPI appraisaland long-term strategic assessment. That ensured the Company’s business performance was stronglylinked to the performance bonus of Senior Management members, giving full play to the incentiveand guiding role of remuneration. To promote the implementation of the Company’s medium- andlong-term incentive plan, it encouraged Senior Management to focus on the short-term performanceof the year and the development of its medium- and long-term performance.
2. Employee Stock Ownership Plans
□ Applicable √ Not applicable
3. Other Incentive Measures for Employees
□ Applicable √ Not applicable
XII Establishment and Implementation of Internal Control System in the Reporting Period
1. Establishment and Implementation of Internal Control SystemDuring the Reporting Period, to boost operational efficiency and results, the Company continuouslyimproved and optimized its existing internal control system in strict compliance with laws,regulations, and external regulatory requirements and taking into consideration its actual status. Inthe process, it was guided by risk management, based itself on procedure streamlining, and focusedon critical control activities.During the Reporting Period, the Company prepared the Handbook of Internal Control Workflow of
CMPort, in which it specified the workflow of the principal business and corresponding authority andresponsibilities and regulated critical control processes, including the setting of internal institutions,the responsibilities and authority for major positions, and the approval procedures. By refining theinternal control workflow, the Company’s internal control management was substantially improved.CMPort achieved full coverage of internal control management during the Reporting Period. Itsupervised and inspected the internal control systems of nine subordinate companies. Concurrently,all subordinate companies conducted internal control self-assessments on a quarterly basis andprepared the internal control weakness checklist in accordance with the annual internal control planof CMPort and focusing on internal control elements including corporate governance, authorizationmanagement, job responsibilities and process activities. By the end of 2023, all internal controlweaknesses are rated as general weaknesses, and no material weaknesses were identified. For thegeneral weaknesses, the Company designated the person responsible for the remediation, developeda remediation plan, and followed up on the remediation progress regularly.The Company prepared the 2023 Internal Control Assessment Report in accordance with the BasicRules for Enterprise Internal Control and its supporting guidelines, other regulatory requirements forinternal control, and the Company’s internal control policies and assessment methods. The conclusionof the report is as follows: By the identification of material weaknesses in the internal control overthe Company’s financial reporting, as at the base day of the internal control assessment report (31December 2023), no material weaknesses were identified in the internal control over the Company’sfinancial reporting. Therefore, the Board of Directors believed that the Company had maintainedeffective internal control over financial reporting in all material respects as per the Basic Rules forEnterprise Internal Control and relevant regulations. According to the identification of materialweaknesses in the Company’s internal control over non-financial reporting, there were no materialweaknesses in the internal control over non-financial reporting as at the base day of the internalcontrol assessment report. Between the base day and the issuance day of the internal controlassessment report, there were no factors that affected the assessment conclusion about theeffectiveness of the internal control.
2. Material Internal Control Weaknesses Identified for the Reporting Period
? Yes √ NoXIII Management and Control over Subsidiaries for the Reporting PeriodThe Company, guided by “empowerment, professionalism and value”, established an operationmanagement system with sustainable value creation, gradually formulated standards for all functionalmodules, and managed to build a world-class value-oriented headquarters. Taking into account thestrategic positioning of its subsidiaries, the Company, adhering to the principles of differentiation andcontrollable risks and pushing forward full-cycle asset management, procurement management, andperformance evaluation mechanism, continuously promoted the healthy development of itssubsidiaries. Besides, focusing on execution quality, the Company intensified the tasks on quality andefficiency improvement and strived to implement related measures to achieve in-depth integrationbetween quality and efficiency improvement and strategic objectives.XIV Internal Control Self-Evaluation Report and Independent Auditor’s Report on InternalControl
Disclosure date of the internal control self-evaluation report
| Disclosure date of the internal control self-evaluation report | 2 April 2024 | |||
| Index to the disclosed internal control self-evaluation report | For details, see www.cninfo.com.cn | |||
| Evaluated entities’ combined assets as % of consolidated total assets | 100.00% | |||
| Evaluated entities’ combined operating revenue as % of consolidated operating revenue | 100.00% | |||
| Identification standards for internal control weaknesses | ||||
| Type | Weaknesses in internal control over financial reporting | Weaknesses in internal control not related to financial reporting | ||
| Nature standard | If a defect or defect group give rise to the following events which cannot be prevented or found and made rectification, the defect or defect group are recognized as significant defects: (1) Malpractices of directors, supervisors | Great defect | Significant defect | Common defect |
| Development direction substantially deviates from the strategic goals, and investment direction, business structure and business model are completely unable to support the realization of strategic goals | Development direction partly deviates from the strategic goals, and investment direction, business structure and business model are unable to support the realization of strategic goals at a larger extent | Development direction slightly deviates from the strategic goals, and investment direction, business structure and business model are unable to fully support the realization of strategic goals | ||
| Strategy implementation is blocked, almost all indicators of strategy | Strategy implementation is blocked, most of indicators of strategy | Strategy implementation is blocked, part of indicators of strategy | ||
and seniormanagement:
(2) The Company make
correction to thefinancial report issued;
(3) Certified Public
Accountant find thatthere is a significanterror in the financialreport, however, theinternal control did notdiscover it whenconducting internalcontrol;
(4) The Audit
Committee under theBoard and InternalAudit Service'ssupervision to theinternal control isinvalid.
| and senior management: (2) The Company make correction to the financial report issued; (3) Certified Public Accountant find that there is a significant error in the financial report, however, the internal control did not discover it when conducting internal control; (4) The Audit Committee under the Board and Internal Audit Service's supervision to the internal control is invalid. | implementation cannot completed as planned | implementation cannot completed as planned | implementation cannot completed as planned |
| Lead to break off of common business/service or it takes half year or above to recover the break off of common business/service | |||
Lead to break off ofcommonbusiness/service or ittakes three months orhalf year below torecover the break off ofcommonbusiness/service
| Some daily business is influenced, lead to break off of common business/service or it takes three months below to recover the break off of common business/service | ||
| Badly damage the working enthusiasm of all the employees, will give rise to large scale group events or heavy damage to enterprises culture and enterprises cohesion | In a large extent, damage the working enthusiasm of all the employees, reduce work efficiency, have greatly adverse effect to enterprises culture and enterprises cohesion | damage the working enthusiasm of all the employees, reduce work efficiency, have some adverse effect to enterprises culture and enterprises cohesion |
| The employee's ability and professional skills universally cannot meet the enterprise development needs by a large margin | The employee's ability and professional skills in some significant fields cannot meet the enterprise development needs | The employee's ability and professional skills in some fields cannot meet the enterprise development |
| Negative news spread in the field of the entire business (including extending to industry chain),or was paid attention by the national media or public media, the recovery of reputation will take more than six months | Negative news spread in the field of the entire business, or was paid attention or reported by the local media the recovery of reputation will take three to six months | Negative news spread in the field of the entire business, have small damage to the reputation of the enterprise, the recovery of reputation will take three months below |
| The enterprise's internal confidential information leakage which badly affect the enterprise's competitive capacity in the market, or affect the competitive capacity in management |
The enterprise's internalconfidential informationleakage which affect theenterprise's competitivecapacity in the market,or affect the competitivecapacity in managementin a large extent
| The enterprise's internal confidential information leakage which affect the enterprise's competitive capacity in the market, or affect the competitive capacity in management in a general extent | ||||
| Quantitative standard | The judging standard was the net profits attributable to the parent Company's shareholders in the consolidated financial statements audited in last year. Misstatement amount ≥ 5% above of judging standard was great defect; 5% judging standard ＞1% misstatement amount | The judging standard was the net profits attributable to the parent Company's shareholders in the consolidated financial statements audited in last year. | ||
| Great defect | Significant defect | Common defect | ||
| Have a significant adverse impact on the asset turnover ability, which lead to total asset turnover rate lowed 20% above (Including 20％） | Have a greater adverse impact on the asset turnover ability, which lead to total asset turnover rate lowed 10% to 20% (Including 10%） | Have an adverse impact on the asset turnover ability, which lead to total asset turnover rate lowed 10% below | ||
| Had significant adverse impact to the annual | Had larger adverse impact to the annual | Had adverse impact to the annual operation | ||
was significant defect;misstatement amount＜1% below of judgingstandard was generalstandard.
| was significant defect; misstatement amount ＜1% below of judging standard was general standard. | operation profits or cause decrease of annual operation profits when at 5% (including 5%) above of judging standard | operation profits or cause decrease of annual operation profits when at 1% (including 1%) to 5% judging standard | profits or cause decrease of annual operation profits when at 1% below of judging standard |
| Had significant adverse impact to decrease of inflow of total cash flow or increase of outflow total cash flow when at 10% (including 10%) above of judging standard | Had larger adverse impact to decrease of inflow of total cash flow or increase of outflow total cash flow when at 5% (including 5%) to 10% above of judging standard | Had adverse impact to decrease of inflow of total cash flow or increase of outflow total cash flow when at 5% below of judging standard | |
| Great investment mistake incurred which cause direct economy losses when at 5% (including 5%) above of judging standard or the return on investment more than 40% lower than expected | Larger investment mistake incurred which cause direct economy losses when at 1% (including 1%)to 5% of judging standard or the return on investment less than 30%(including 30% to 40%) lower than expected | Great investment mistake incurred which cause direct economy losses when at 1% below of judging standard or the return on investment less than 30% lower than expected | |
| 10 death or above , or 50 people serious injury, or direct economy losses when at 5% (including 5%) above of judging standard | 3 deaths above to 10 deaths below , or more than 10 people but less than 50 people serious injury, or direct economy losses when at 1% (including 1%) to 5% of judging standard | less than 3 deaths or above , or less than 10 people serious injury, or direct economy losses when at 1% below of judging standard | |
| Asset integrity cannot be ensured, when assets losses at 5% (including 5%) above of judging standard | Asset integrity cannot be ensured, when assets losses at 1% (including 1%)to 5% of judging standard | Asset integrity cannot be ensured, when assets losses at 1% below of judging standard | |
| A large number of great commercial disputes, civil lawsuits and negative influences can't eliminate in a short period of time, may pay compensation at 5% (including 5%) above of judging standard | Several commercial disputes, civil lawsuits, and had obviously influence in a certain area and period, may pay compensation at 1% (including 1%) to 5% of judging standard | Irreconcilable commercial disputes, civil lawsuits happened sometimes, cause a certain influences in local, may pay compensation at 1% below of judging standard | |
| A serious violation of laws and regulations, investigated by government department and legal department, cause prosecution and class action, may pay compensation at 2% (including 2%) above of judging standard | A serious violation of laws and regulations, investigated by government department and legal department, may pay compensation at 0.5% (including 0.5%) to 2% of judging standard | Violation of laws and regulations, investigated by government department and legal department, may pay compensation at 0.5% below of judging standard |
Number of material weaknesses in internal control over financial reporting
| Number of material weaknesses in internal control over financial reporting | 0 |
| Number of material weaknesses in internal control not related to financial reporting | 0 |
| Number of serious weaknesses in internal control over financial reporting | 0 |
| Number of serious weaknesses in internal control not related to financial reporting | 0 |
Note: The percentages of evaluated entities’ combined assets and operating revenue to consolidatedtotal assets and operating revenue have been deducted the corresponding financial data of the mergedcompany.
| Opinion paragraph in the independent auditor’s report on internal control | |
| We believe that China Merchants Port Group Co., Ltd. has maintained effective internal control over financial reporting in all material respects as of 31 December 2023 as per the Basic Rules for Enterprise Internal Control and relevant regulations. | |
| Independent auditor’s report on internal control disclosed or not | Disclosed |
| Disclosure date | 2 April 2024 |
| Index to such report disclosed | For details, see www.cninfo.com.cn |
| Type of the auditor’s opinion | Unmodified unqualified opinion |
| Material weaknesses in internal control not related to financial reporting | None |
Indicate by tick mark whether any modified opinion is expressed in the independent auditor’s reporton the Company’s internal control.? Yes √ NoIndicate by tick mark whether the independent auditor’s report on the Company’s internal control isconsistent with the internal control self-evaluation report issued by the Company’s Board.
√ Yes ? No
XV Rectifications of Problems Identified by Self-inspection in the Special Action for ListedCompany GovernanceUpon a comprehensive self-inspection, the Company has adhered to the combination of the leadershipof the Communist Party of China and corporate governance throughout operations and complied withrelevant laws, regulations, and normative documents, such as improving the internal governancemechanism, refining the governance system, and disclosing information in an open and transparentmanner.
Part V Environmental and Social ResponsibilityI Major Environmental Issues
1. Policies and industry standards pertaining to environmental protectionDuring the Reporting Period, the Company and its subsidiaries with heavy pollutant discharge needsabode by laws and regulations related to environmental protection throughout routine production andoperation, including the Environmental Protection Law of the People’s Republic of China, the Lawof the People’s Republic of China on the Prevention and Control of Atmospheric Pollution, the Lawof the People’s Republic of China on Prevention and Control of Water Pollution, the Law of thePeople’s Republic of China on the Prevention and Control of Solid Waste Pollution, the Law of thePeople’s Republic of China on Noise Pollution Prevention and Control, the Law of the People’sRepublic of China on the Prevention and Control of Soil Pollution, the Law of the People’s Republicof China on Environmental Impact Assessment, and Regulation on the Administration of Permittingof Pollutant Discharges of the People’s Republic of China. They also strictly complied with nationaland industry standards pertaining to environmental protection, such as Standard for Fugitive Emissionof Volatile Organic Compounds, Technical Specification for Setting Identification Signs of HazardousWaste, Standard for Pollution Control on Hazardous Waste Storage, Discharge Standard ofPollutants for Municipal Wastewater Treatment Plant, Emission Standard of Air Pollutant for BulkPetroleum Terminals, Emission Standard for Noise of Industrial Enterprises at Boundary.
2. Administrative permit for the purpose of environmental protectionThe environmental impacts of the construction projects of domestic enterprises controlled by theCompany were assessed as required. Additionally, all domestic pollutant discharge units haveobtained administrative permits for pollutant discharge as per laws and regulations and dischargedpollutants by the administrative permits for pollutant discharge in a legal and compliant manner. All
units of the Company with heavy pollutant discharge needs have obtained the national pollutantdischarge permit and specific information on the pollutant discharge permit number is as follows:
(1) The First Branch of Zhanjiang Port (Group) Co., Ltd.: 914408008943759949001R
(2) Zhanjiang Port Petrochemical Terminal Co., Ltd.: 914408007247840152001R
3. The regulations for industrial emissions and the particular requirements for controllingpollutant emissions those are associated with production and operational activities
Nameof thecompany orsubsidiarycompan
y
| Name of the company or subsidiary company | Types of major and characteristic pollutants | Names of major and characteristic pollutants | Discharge method | Outlet quantity | Outlet distribution | Discharge concentration (mg/kg) | Pollutant discharge standards | Total discharge | Total discharge approved | Excessive discharge |
| The First Branch of Zhanjiang Port (Group) Co., Ltd. (Key noise discharge unit) | Noise | Noise | Fugitive | -- | -- | Daytime: 57db Night: 50db | Emission Standard for Noise of Industrial Enterprises at Boundary (GB12348-2008)- Standards for Category 3 | -- | -- | No excessive discharge |
| Zhanjiang Port Petrochemical Terminal Co., Ltd. (Key air pollutant discharge unit) (Exhaust emission) | Air pollutants (Plant boundary) | VOC | Fugitive | -- | -- | 2.5mg/m3 | Emission Limits of Air Pollutants (DB44/27-2001) | 227.671t | 274.96t/a | No excessive discharge |
| Methanol | Fugitive | -- | -- | 2L | ||||||
| Malodor | Fugitive | -- | -- | <10 | Emission Standards for Odor Pollutants (GB14554-93) | |||||
| Air pollutants (In-plant) | VOC | Fugitive | -- | -- | 1.93mg/m3 | Emission Limits of Air Pollutants (DB44/27-2001) | ||||
| VOC | Organized (Intermittent discharge) | 2 | North of the car loading dock | 1469mg/m3 | Emission Standards for Air Pollutants from Oil Storage Depots (GB20950-2020) |
Methanol
| Methanol | Organized (Intermittent discharge) | 1 | North of the car loading dock | 50mg/m3 | Emission Limits of Air Pollutants (DB44/27-2001) |
4. Treatment of pollutants
During the Reporting Period, the pollution treatment facilities for wastewater and exhaust gas of theenterprises controlled by the Company ran normally, with pollutants discharged in a compliantmanner. In terms of equipment and facilities improvements, a new wastewater treatment station hasbeen put into operation, bringing the total number of treatment stations to 38, resulting in an annualincrease in wastewater treatment capacity of 700,000 tons/year, which eventually reached 24.92million tons per year. Besides, with respect to the VOCs control, the Company has actively completedvolatile organic compounds recycling facilities at 10,000-ton ship loading berths and conductedgovernance work to ensure that facilities for volatile organic compounds ran normally. Moreover,sound-proof walls were well maintained to ensure that the noise at the plant boundary met thestandards. Information on units with heavy pollutant discharge needs controlled by the Company isas follows:
(1) The first branch of Zhanjiang Port (Group) Co., Ltd.
In sewage treatment, it has a production sewage treatment system, with a treatment capacity of 5,800m3/d. The treated sewage is used for watering and dust control in the port area.In dust control management, the Company used water spray, water mist spray, sprinklers, 15 spraytowers, 33 mobile remote fog machines, and two mobile dust suppression funnels, and other facilitiesto meet the demand for dust control throughout the operation. The stockpiles were fully covered, andthe dust control management of static storage and dynamic operation was strengthened to reduce dustemissions to the maximum.In noise reduction, the Company from the source adopted measures including equipment maintenance,road repair to reduce noise generation; in the process, it optimised on-site operational layout andadjustment of operating hours, to reduce the impact of noise by management means; in the end, it
built a 160-meter-long, 12-meter-high dust-free and sound-proof wall along the factory, to control thenoise impact.In solid waste management, an intelligent monitoring system for solid waste was installed, and oneroom for storing hazardous waste was set up, which is protected against thunder, wind, rain, sunlight,and seepage according to the requirements. A qualified third party was entrusted to transport thehazardous waste in a timely and compliant manner.
(2) Zhanjiang Port Petrochemical Terminal Co., Ltd.
In sewage treatment, it has two production wastewater treatment systems and one domesticwastewater treatment system.In waste gas management, Zhanjiang Port Petrochemical Terminal Co., Ltd. completed the oil andgas recycling equipment project for three 1,000-ton ship loading berths, automobile platforms andtrain platforms, and then responded to the new requirements of the country by accomplishing theconstruction of oil and gas recycling equipment for 10,000-ton ship loading berths and putting theminto use during the reporting period.In solid waste management, an intelligent monitoring system for solid waste was installed, and tworooms for storing hazardous waste was set up, which is protected against thunder, wind, rain, sunlight,and seepage according to the requirements. A qualified third party was entrusted to transport thehazardous waste in a timely and compliant manner.
5. Environmental self-monitoring program
During the Reporting Period, enterprises under the Company that are subject to the pollutantdischarge permits formulated self-monitoring plans as per laws, regulations, and pollutant dischargepermits. As a result, the monitoring results indicated that all indicators met the standards. Informationon units with heavy pollutant discharge needs controlled by the Company is as follows:
(1) The First Branch of Zhanjiang Port (Group) Co., Ltd. has developed a noise self-monitoring plan,by which it conducts noise monitoring every quarter. All indicators meet requirements, and the
monitoring report will be submitted to local ecological and environmental authorities.
(2) Zhanjiang Port Petrochemical Terminal Co., Ltd. has developed an air self-monitoring plan, bywhich it conducts air monitoring every quarter. All indicators meet requirements, and the monitoringreport will be submitted to local ecological and environmental authorities.
6. Contingency plan for environmental emergencies
During the Reporting Period, the Contingency Plan for Environmental Emergencies of the Companycontinued to be effective, and all enterprises controlled by the Company prepared a contingency planfor environmental emergencies as required. Units with heavy pollutant discharge needs filedenvironmental emergencies at local ecological and environmental bureaus as required. Details aboutthe filing number of contingency plan for environmental emergencies are as follows:
(1) The First Branch of Zhanjiang Port (Group) Co., Ltd.: 440803-2021-0025-M
(2) Zhanjiang Port Petrochemical Terminal Co., Ltd.: 440803-2021-0040-H
7. Input in environmental governance and protection and payment of environmental protectiontaxThe Company constantly increases its input into environmental protection to make sure that variouspollutants constantly meet the standards and thus contribute to business sustainability. During theReporting Period, the Company spent RMB169 million on environmental protection and paidRMB5.73 million for environmental protection tax in full in time as per laws and regulations.
8. Measures taken to decrease carbon emission in the Reporting Period and correspondingeffectsCMPort vigorously responds to and implements the national requirements as well as the requirementsof CMG for carbon peak and carbon neutrality, implements energy saving and carbon reductionstrictly in accordance with the Action Plan of CMPort for Achieving Carbon Peak and CarbonNeutrality formulated and helps the effective implementation of the goal of “achieving carbon peakby 2028 and carbon neutrality by 2060”. During the Reporting Period, the Company’s 57 carbon
reduction projects achieved a carbon reduction of 8,000 tons.
9. Administrative penalties for environmental problems during the Reporting Period
□ Applicable √ Not applicable
10. Other environmental information that should be disclosed
None
11. Other information related to environmental protection
NoneII Corporate Social Responsibility (CSR)The Company highlighted and practiced corporate social responsibilities. While improving businessperformance and creating benefits for shareholders, the Company earnestly performed its socialresponsibilities for employees, society and environment, and promoted the sustainable developmentof the enterprise and society. Furthermore, it continued to build the “Shaping Blue Dreams Together(C-Blue)” charity brand. By leveraging its core strengths to launch domestic and overseas charitableactivities, support community development and advance cultural exchange, the Companyincorporated social development needs into its daily operation activities and joint hands with morepartners to create a harmonious society and promote social progress.The main achievements in 2023 are as follows:
1. Overseas, Colombo International Container Terminals Ltd. (CICT) and Hambantota InternationalPort Group (HIPG) jointly initiated the program, “China Merchants Silk Road Love Villages”, whichsuccessively achieved results in Kenda Village, Sri Lanka. Moreover, community activity centers,medical and health care centers, crop cultivation bases, poultry breeding bases and otherinfrastructures were constructed. This benefits more than 6,000 villagers, creating nearly 800 jobs forthe local community. Through technical training for villagers, the people can enjoy the dividendsbrought by enterprise development. These measures assist local people in exploring a replicable andsustainable path out of poverty, to truly perform the principle of “teaching a man to fish is better thangiving him a fish”. After achieving fruitful results in Kenda Village, the Village will be taken as asuccessful example to gradually explore the path of sustainable development in impoverished ruralareas overseas, so as to benefit more villages in Sri Lanka. TCP Brazil, in conjunction withprofessional organizations, continuously carried out monitoring of dolphin and sea turtle populationsin the area around the terminal, and mobilized employee volunteers to participate in mangrove
cleanup and protection to collect waste garbage from the mangrove forests along the Ittibel River andin the area. These actions have helped to avoid adverse impacts on local marine biota, and deeplyperformed biodiversity conservation.Domestically, the Company successfully hosted the Children’s Growth Camp of the C-Blue RuralEducation Charity Programme in Lianping, Heyuan, Weining, Guizhou and Xuwen, Zhanjiang.Through innovative C-Blue cloud classroom and other forms of activities, it helped rural schoolsaccess high-quality urban education resources, committed to promoting rural revitalization througheducation. The Company continued to implement the “C Blue Training Programme”, cultivating 63trainees from 30 countries in 2023. It also participated in the case exhibition at people-to-peopleexchange sessions under the Third Belt and Road Forum for International Cooperation. ZhanjiangPort, the Company’s subsidiary, offered community volunteer services vigorously. For instance, ittook care of left-behind children through the childcare volunteer service of “Spring Breeze forSeedlings”. Shantou CM Port Group organized six public welfare events for three hours, including“activities of ‘Love for the Motherland, Love for the Hometown and Love for the Port’ by schoolsand enterprises”, “taking green and harmonious actions to be an environmental protection guard forhometown”, “practical exercise of fire extinguishers and teaching of cardio-pulmonary resuscitation”,“maker competition”, “delivering warmth to households”, and “shaping good mindsets to be apositive teenager”. Through these activities, the Company practiced the ESG concept and physicallycontributed to sustainable development. The West Shenzhen port actively organized its employees toparticipate in volunteer activities, such as environmental protection public welfare activities, unpaidblood donation, and parent-child volunteer service activities, encouraging them to assume their socialresponsibilities as the Company’s employees and play their roles as role models.Please refer to Sustainable Development Report of China Merchants Port Group Co., Ltd. in 2023 forthe fulfilment of social responsibilities in the Reporting Period for details.III Consolidation and Expansion of Poverty Alleviation Outcomes, and Rural RevitalizationIn 2023, Zhanjiang Port subordinate to the Company, followed the general requirements of the ruralrevitalization strategy featuring “industrial prosperity, ecological livability, rural civilization,effective governance and affluent life”, adhered to the concepts of China Merchants’ povertyalleviation, public welfare and harmonious development, and carried forward its fine tradition of“serving the society with sincerity and responsibility”. It assumed its social responsibility byconstantly sending working groups to fully cooperate with Zhanjiang City to implement the strategyof rural revitalization to solidly promote the improvement in the rural living environment, and to
make every effort to effectively connect the results of poverty alleviation and rural revitalization, soas to make positive contributions to rural revitalization in Zhanjiang City.Zhanjiang Port has been committed to providing practical assistance and doing good deeds forvillagers. In 2023, in the paired Haian Town for rural revitalisation, there are a total of 11 projects ofvarious types that were completed and are being implemented. The cultural publicity project for ruralrevitalisation was launched on both sides of avenues in Xuwen County, Haian Township, XingleiVillage. The cultivation of civilised rural style, good family style, and honest resident style is viewedas an important task to inject cultural confidence for rural revitalization, boosting spirit and enhancingcohesion. The working group has repeatedly worked with village leaders to understand the livingconditions of poverty-stricken and low-income households, updated the system data of more than 30poverty-stricken households in a timely manner, and formulated targeted assistance initiative of “onepolicy for one household”. The staff stationed in the town actively participated in the work ofimproving the human environment in the town and village as well as in the work of creating a civilizedcity and clean town, and gave the Spring Festival and Mid-Autumn Festival condolences forhouseholds in difficulty, which covered those monitored to prevent poverty, old party members andchildren in difficulty. On-site assessment activities were conducted on 36 natural villages in the townin various aspects such as environmental improvement, rural landscape, public services, andgrassroots governance. Good results were achieved in the improvement of the living environment ineach village. Apart from that, Zhanjiang Port Group also carried out sewage road cleaning project forLonghua Village around the port, as well as a hard bottoming project for roads in Baoman Village.
Part VI Significant EventsI Fulfilment of Commitments
1. Commitments of the Company’s Actual Controller, Shareholders, Related Parties, andAcquirers, as well as the Company Itself and other Entities Fulfilled in the Reporting Period orOngoing at the Period-end
Commitm
ent
| Commitment | Promisor | Type of commitment | Details of commitment | Date of commitment making | Term of commitment | Fulfilment |
| Commitments made in acquisition documents or shareholding alteration documents | CMGD and Broadford Global | Commitments on horizontal competition, related-party transaction and capital occupation | Commitment on safeguarding independence of CMPort made by CMGD and its person acting in concert Broadford Global: to safeguard the independence of finance, institutions, business and personnel of CMPort as well as independence and integrity of assets of CMPort. | 15 March 2018 | The commitment on safeguarding independence of CMPort is effective for a long time; the commitment on regulating related-party transactions is effective during the period when CMGD and its persons acting in concert possess control power over the Company | Ongoing |
| CMGD and Broadford Global | Commitments on horizontal competition, related-party transaction and capital occupation | Commitment on regulating related-party transaction made by CMGD and corresponding persons acting in concert- Broadford Global: 1. CMGD/Broadford Global will make a great effort to reduce related-party transaction between CMGD/Broadford Global and its related parties as well as CMPort. Inevitable business dealings or transactions shall be conducted as per marketization principle and fair price and the obligation of information disclosure shall be fulfilled pursuant to provisions; 2. CMGD/Broadford Global and its related parties ensure they will strictly observe related stipulations of laws, regulations, normative documents and Articles of Association of CMPort and equally execute shareholders' rights and fulfil shareholders' obligations together with other shareholders in line with legal program as well as won't seek improper interest with actual controller's status or damage legitimate interest of CMPort and other shareholders; 3. The above commitment is continuously effective during the period when CMGD/Broadford Global has the right to control CMPort. In case of losses incurred by | 15 March 2018 | The commitment on safeguarding independence of CMPort is effective for a long time; the commitment on regulating related-party transactions is | Ongoing |
CMGD/Broadford Global failing to fulfil the above commitmentto CMPort, CMGD will bear corresponding compensationresponsibility.
| CMGD/Broadford Global failing to fulfil the above commitment to CMPort, CMGD will bear corresponding compensation responsibility. | effective during the period when CMGD and its persons acting in concert possess control power over the Company | |||||
| CMG | Commitments on horizontal competition, related-party transaction and capital occupation | Commitment on regulating related-party transaction: 1. China Merchants Group will try its best to reduce related-party transaction between it and its related parties and CMPort. Inevitable business dealings or transactions shall be conducted as per marketization principle and fair price and the obligation of information disclosure shall be fulfilled pursuant to provisions; 2. China Merchants Group ensure they will strictly observe related stipulations of laws, regulations, normative documents and Articles of Association of CMPort and equally execute shareholders' rights and fulfil shareholders' obligations together with other shareholders in line with legal program as well as won't seek improper interest with actual controller's status or damage legitimate interest of CMPort and other shareholders; 3. The above commitment is continuously effective during the period when China Merchants Group has the right to control CMPort. In case of losses incurred by China Merchants Group failing to fulfil the above commitment to CMPort, China Merchants Group will bear corresponding compensation responsibility. | 15 March 2018 | Effective until no-longer to be the actual controller of the Company | Ongoing | |
| Commitments made in time of asset restructuring | CMPID | Commitments on horizontal competition, related-party transaction and capital occupation | Commitment on avoiding horizontal competition: 1. CMPID and other enterprise controlled by CMPID fail to engage in or participate in business or activity which is similar with and constitutes or likely constitutes competitive relation with main business conducted by CMPort and the enterprise controlled by it now; 2. CMPID will try its best to promote CMPID and other enterprise controlled by CMPID not to directly or indirectly engage in or participate in or assist to engage in or participate in any business or activity which constitutes or likely constitutes competitive relation with main business conducted by CMPort and the enterprise controlled by it now and in the future independently or together with others; 3. In case of discovering any new business opportunity which constitutes or likely constitutes direct or indirect competitive relation with main business of CMPort or the enterprise controlled by it, CMPID or CMPID and other enterprise controlled by it will immediately notify CMPort in written as well as make a great effort to promote such business opportunity to be provided to CMPort or the enterprise controlled by it firstly according to reasonable and fair terms and conditions; 4. In case of CMPort or the enterprise controlled by it waiving such competitive new business opportunity and CMPID or/and other enterprise controlled by it engaging in such competitive business, CMPort or the enterprise controlled by it will have the right to purchase any stock rights, assets or other rights and interests in the above competitive business from CMPID or/and other enterprise controlled by it once or several times at any moment, or CMPort will select entrusted operation, leasing or contract operation of assets or businesses of CMPID or/and other enterprise controlled by it in the above competitive business as per the mode permitted by national laws and regulations; 5. When CMPID and other enterprise controlled by it plans to transfer, sell, rent out, conduct licensed use of or transfer or allow to use assets and businesses | 26 July 2018 | Effective until no-longer to be the largest shareholder of the Company | Ongoing |
which constitutes or likely constitutes direct or indirectcompetitive relationship with main business of CMPort or theenterprise controlled by it in other way, CMPID and otherenterprise controlled by it will provide the right of priorityassignment to CMPort or the enterprise controlled by it andpromise to make a great effort to promote other enterprisecontrolled by CMPID provide CMPort or the enterprisecontrolled by it with the right of priority assignment under theabove situation; 6. As of the date when the commitment letter isprovided, CMPID promises to compensate all actual losses,damages and expenses arising from violation of any clause in thecommitment letter by CMPID or the enterprise controlled by itto CMPort or the enterprise controlled by it.
| which constitutes or likely constitutes direct or indirect competitive relationship with main business of CMPort or the enterprise controlled by it in other way, CMPID and other enterprise controlled by it will provide the right of priority assignment to CMPort or the enterprise controlled by it and promise to make a great effort to promote other enterprise controlled by CMPID provide CMPort or the enterprise controlled by it with the right of priority assignment under the above situation; 6. As of the date when the commitment letter is provided, CMPID promises to compensate all actual losses, damages and expenses arising from violation of any clause in the commitment letter by CMPID or the enterprise controlled by it to CMPort or the enterprise controlled by it. | |||||
| CMPID | Commitments on horizontal competition, related-party transaction and capital occupation | Commitment on regulating related-party transaction: 1. CMPID and other enterprise controlled by it will make a great effort to avoid and reduce related-party transaction between CMPort and economic entity controlled by it; 2. CMPID and other enterprise controlled by it will exercise stockholder's rights in accordance with related provisions of relevant laws and regulations as well as Articles of Association of CMPort and fulfil the obligation of vote avoidance at the moment of voting for related-party transactions involved by CMPID and other enterprise controlled by it at the stockholders' meeting; 3. As for related-party transaction which is inevitable or occurs due to reasonable reason, CMPID will carry out transaction pursuant to the principle of openness, fairness and justice for market transaction and based on fair and reasonable market price, perform related-party transaction decision-making process and legally fulfil information disclosure obligation to safeguard benefits of CMPort and other shareholders of CMPort in line with provisions of laws, regulations, normative documents and Articles of Association of CMPort; 4. It's ensured that no legitimate interest of CMPort and other shareholders of CMPort is damaged by related-party transaction based on status and influence of CMPort; 5. CMPID will promote other enterprise controlled by it to observe the commitment of Subparagraph 1-4; 6. In case of CMPID and other enterprise controlled by it violating the above commitment, causing rights and interests of CMPort and its shareholders are damaged, CMPID will take corresponding compensation responsibility according to law. | 26 July 2018 | Effective until no-longer to be the largest shareholder of the Company | Ongoing |
| CMPID | Commitments on horizontal competition, related-party transaction and capital occupation | Commitment about keeping independence of CMPort: 1. After the transaction is completed, CMPID will strictly observe related provisions regarding independence of listed Companies from CSRC and won't violate standard operating procedures of CMPort based on the first majority shareholder, conduct excessive intervention of operation and management activities of CMPort and its subsidiary, embezzle benefits of CMPort and its subsidiary or damage legitimate interest of CMPort and other shareholders; 2. CMPID will ensure CMPort is independent from CMPID and related parties in the aspects of business, asset, finance, personnel and institution; 3. CMPID ensures independence of CMPort, CMPID and other enterprise controlled by it fail to occupy capitals and resources of CMPort based on violation in any way and will strictly observe provisions of rules and regulations for avoiding occupation of related party funds from CMPort as well as related laws, regulations and normative documents; 4. The commitment letter takes effect as of the signature date of CMPID as well as is legally binding upon CMPID. CMPID ensures it will strictly fulfil various commitments in the commitment letter and will take corresponding legal responsibility for losses incurred to CMPort due to violation of related commitment. | 26 July 2018 | Effective until no-longer to be the largest shareholder of the Company | Ongoing |
| CMG | Commitments on horizontal competitio | Commitment on avoiding horizontal competition: 1. China Merchants Group and the enterprise controlled by it (excluding CMPort Holdings and the enterprise controlled it) fail to engage in or participate in any business or activity which is similar with | 26 July 2018 | Effective until no-longer to be the | Ongoing |
n, related-partytransactionand capitaloccupation
| n, related-party transaction and capital occupation | and constitutes or likely constitute direct or indirect competitive relationship with main business conducted by CMPort and the enterprise controlled by it now; 2. China Merchants Group will try its best to promote enterprises controlled by it (except for CMPort and the enterprise controlled by it) not to directly or indirectly engage in or participate in or assist to engage in or participate in any business or activity which constitutes or likely constitutes competitive relation with main business conducted by CMPort and the enterprise controlled by it now and in the future independently or together with others; 3. In case of discovering any new business opportunity which constitutes and likely constitutes direct or indirect competitive relation with main business of CMPort or the enterprise controlled by it, China Merchants Group or enterprise controlled by it(except for CMPort and the enterprise controlled by it) will immediately notify CMPort in written as well as make a great effort to promote such business opportunity to be provided to CMPort or the enterprise controlled by it firstly according to reasonable and fair terms and conditions; 4. In case of CMPort or the enterprise controlled by it waives such competitive new business opportunity and China Merchants Group or the enterprise controlled by it (except for CMPort and the enterprise controlled by it) engaging in such competitive business, CMPort or the enterprise controlled by it will be entitled to purchase any equities, assets and other rights and interests in the above competitive business from China Merchants Group or the enterprise controlled by it (except for CMPort and the enterprise controlled by it) once or several times at any moment or CMPort will select entrusted operation, leasing or contract operation of assets or businesses of China Merchants Group or the enterprise controlled by it (except for CMPort and the enterprise controlled by it) in the above competitive business according to the mode permitted by national laws and regulations; 5. When China Merchants Group and the enterprise controlled by it (except for CMPort and the enterprise controlled by it) plans to transfer, sell, lease, allow to use or transfer or allow to use asset and business which constitutes or likely constitutes direct or indirect competitive relationship with main business of CMPort or the enterprise controlled by it in other way, China Merchants Group and the enterprise controlled by it (except for CMPort and the enterprise controlled by it) will provide the right of priority assignment for CMPort or the enterprise controlled by it and promise to make a great effort to promote the enterprise controlled by China Merchants Group to provide the of priority assignment for CMPort or the enterprise controlled by it under the above situation; 6. As of the date when the commitment letter is provided, China Merchants Group promises to compensate all actual losses, damages and expenses arising from violation of any clause in the commitment letter by China Merchants Group or the enterprise controlled by it to CMPort or the enterprise controlled by it. | actual controller of the Company | |||
| CMG | Commitments on horizontal competition, related-party transaction and capital occupation | Commitment on regulating related-party transaction: 1. China Merchants Group and other enterprise controlled by it will make a great effort to avoid and reduce related-party transaction between CMPort and economic entity controlled by it; 2. China Merchants Group and other enterprise controlled by it will exercise stockholder's rights in accordance with related provisions of relevant laws and regulations as well as Articles of Association of CMPort and fulfil the obligation of vote avoidance at the moment of voting for related-party transactions involved by China Merchants Group and other enterprise controlled by it at the stockholders' meeting; 3. As for related transaction which is inevitable or occurs due to reasonable reason, China Merchants Group will carry out transaction pursuant to the principle of openness, fairness and justice for market transaction and based on fair and reasonable market | 26 July 2018 | Effective until no-longer to be the actual controller of the Company | Ongoing |
price, perform related-party transaction decision-making processand legally fulfil information disclosure obligation to safeguardbenefits of CMPort and other shareholders of CMPort in linewith provisions of laws, regulations, normative documents andArticles of Association of CMPort; 4. It's ensured that nolegitimate interest of CMPort and other shareholders of CMPortis damaged by related-party transaction based on status andinfluence of CMPort; 5. China Merchants Group promotes otherenterprise controlled by it to observe the commitment set forthin Subparagraph 1-4 above; 6. In case of China Merchants Groupand other enterprise controlled by it violating the abovecommitment, causing rights and interests of CMPort and itsshareholders are damaged, China Merchants Group will takecorresponding compensation responsibility according to law.
| price, perform related-party transaction decision-making process and legally fulfil information disclosure obligation to safeguard benefits of CMPort and other shareholders of CMPort in line with provisions of laws, regulations, normative documents and Articles of Association of CMPort; 4. It's ensured that no legitimate interest of CMPort and other shareholders of CMPort is damaged by related-party transaction based on status and influence of CMPort; 5. China Merchants Group promotes other enterprise controlled by it to observe the commitment set forth in Subparagraph 1-4 above; 6. In case of China Merchants Group and other enterprise controlled by it violating the above commitment, causing rights and interests of CMPort and its shareholders are damaged, China Merchants Group will take corresponding compensation responsibility according to law. | |||||
| CMG | Commitments on horizontal competition, related-party transaction and capital occupation | Commitment about keeping independence of CMPort: 1. After the transaction is completed, China Merchants Group will strictly observe related provisions regarding independence of listed companies from CSRC and won't violate standard operating procedures of CMPort based on actual controller's status, conduct excessive intervention of operation and management activities of CMPort and its subsidiary, embezzle benefits of CMPort and its subsidiary or damage legitimate interest of CMPort and other shareholders; 2. China Merchants Group will ensure CMPort is independent from China Merchants Group and related parties in the aspects of business, asset, finance, personnel and institution; 3. China Merchants Group ensures independence of CMPort, China Merchants Group and other enterprise controlled by it fail to occupy capitals and resources of CMPort based on violation in any way and will strictly observe provisions of rules and regulations for avoiding occupation of related party funds from CMPort as well as related laws, regulations and normative documents; 4. The commitment letter takes effect as of the signature date of China Merchants Group as well is legally binding upon China Merchants Group. China Merchants Group ensures it will strictly fulfil various commitments in the commitment letter and will take corresponding legal responsibility for losses incurred to listed Company due to violation of related commitment. | 26 July 2018 | Effective until no-longer to be the actual controller of the Company | Ongoing |
| CMG | Other commitment | Commitment letter about perfecting the property ownership certificate for land and house property of CMPort Holdings and the enterprise subordinate to it: 1. China Merchants Group will spare no effort to assist, promote and drive CMPort Holdings and the enterprise subordinate to it to standardize, perfect and solve ownership defects of properties such as land and house property; 2. The following situations happen to CMPort Holdings and the enterprise subordinate to it before completion of the transaction: (1) Land use right of ownership certificate which is being handled, the house property failing to be timely handled (except for results incurred by force majeure, law, policy, government administration behavior and change in planned use of the land instead of CMPort Holdings and the enterprise subordinate to it); Or (2) Land use right of ownership certificate, the property ownership certificate failing to be handled (except for results incurred by force majeure, law, policy, government administration behavior and change in planned use of the land of CMPort Holdings and the enterprise subordinate to it); Or (3) In case of nonstandard other land use right and house property (except for results incurred by force majeure, law, policy, government administration behavior and change in planned use of the land instead of CMPort Holdings and the enterprise subordinate to it) and encountering actual losses (including but not limited to compensation, fine, expenditure and benefit lost), China Merchants Group will timely and fully compensate CMPort. | 26 July 2018 | Effective until no-longer to be the actual controller of the Company | Ongoing |
| CMG | Other commitme | Commitment letter about real estate leased by CMPort Holdings and the enterprise subordinate to it: In case of nonstandard | 26 July 2018 | Effective until no- | Ongoi |
nt
| nt | situation of the leased property significantly influencing use of CMPort Holdings and the Company subordinate to it to engage in operation of normal business, China Merchants Group will actively take effective measures (including but not limited to arranging to provide the property with identical or similar conditions to be used for operation of related Company) to promote business operation of related Company to be conducted normally and alleviate or eliminate adverse effect; In case of nonstandard of the leased property causing CMPort Holdings and the enterprise subordinate to it produce actual additional expenditures or losses (such as third-party compensation), China Merchants Group will actively coordinate and negotiate with other related party to support normal operation of CMPort Holdings and the enterprise subordinate to it to the great extent and avoid or control continuous enlargement of the damage; At the same time, China Merchants Group agrees compensate CMPort Holdings and the enterprise subordinate to it in cash for actual losses incurred to CMPort Holdings and the enterprise subordinate to it for this reason to relieve or eliminate adverse effect. | longer to be the actual controller of the Company | ng | ||
| CMG | Other commitment | Commitment letter about allotted land of the enterprise subordinate to China Merchants Port Holdings Company Limited from China Merchants Group: In case that the above allotted land is withdrawn or needs to be translated into assignment land due to policy adjustment in the future after the transaction is completed, China Merchants Group will actively coordinate with CMPort and related companies such as China Merchants Group International Port (Qingdao) Co., Ltd. and Shantou CMPort Group Co., Ltd. to handle the transfer procedure or take other feasible countermeasures. In case of any actual loss (excluding land-transferring fees or rent, fees paid for taking rural land, ownership registration fees, taxes and dues and other related expenses to be paid by Chiwan Wharf or above-mentioned related companies according to provisions of laws and regulations) incurred to CMPort or above-mentioned related companies for this reason, China Merchants Group will timely and fully compensate actual loss incurred to CMPort or above-mentioned related companies. | 26 July 2018 | Effective until no-longer to be the actual controller of the Company | Ongoing |
| CMG | Other commitment | Commitment letter about undertaking the accreditation fees of property ownership certificate for the perfection of the land and house property of CMPort Holdings and the enterprise subordinate to it: In case of defective land use right and house property involved by the Company subordinate to CMPort Holdings on account of operation (namely land use right and house property of the Company subordinate to CMPort Holdings without complete ownership certificate existing before the transaction is completed), incurring registration fees such as taxes and dues, compensation and fine in the process of perfecting legal procedures of defective land use right and house property by the subordinate to CMPort Holdings, China Merchants Group will timely and fully compensate to the Company subordinate to CMPort Holdings for undertaking. | 14 September 2018 | Effective until no-longer to be the actual controller of the Company | Ongoing |
| CMG | Other commitment | Commitment letter about related matters of CMPort after the transaction is completed: After the transaction is completed, Chiwan Wharf will become port business asset management headquarters and domestic capital operation platform of China Merchants Group, deeply participate in integration of domestic regional port assets and enlarge the scale of domestic listed assets to make net profit of CMPort Holdings (00144.HK) enjoyed as per the rights and interests in the consolidated statement of listed Company in recent one fiscal year fail to exceed 50% net profit of consolidated statement of the listed Company and net asset of CMPort Holdings (00144.HK) enjoyed in light of rights and interests in the consolidated statement of listed Company in recent one fiscal year fail to exceed 30% net asset in the consolidated statement of the listed Company within 3-5 years | 30 September 2018 | Three to five years and CMG is the actual controller of the Company | Ongoing |
after the transaction is completed.
| after the transaction is completed. | |||||
| CMG | Other commitment | China Merchants Group and all its directors, supervisors and administrative officers ensure the transaction report, its abstract, other information provided for the transaction and application document are true, accurate and complete without false record, misleading statement or important omission as well as take individual and joint legal liability for false record, misleading statement or important omission. If the information provided or disclosed by this transaction is suspected of false records, misleading statements or major omissions, and is investigated by the judicial authorities or investigated by the China Securities Regulatory Commission (CSRC), the directors, supervisors or senior managers of China Merchants Group do not transfer the shares that have interests in listed Company, and submit the written application and stock account of the suspension of the transfer to the Board of Directors of the CMPort within two trading days after receiving the filing inspection notice, and the Board of Directors shall apply for lock-up on behalf of the CMG Hong Kong to the Stock Exchange and Registration and Settlement Company. In case of failing to file a locking application within two transaction days and after the Board of Directors is authorized for verification, identity information and account information on directors, supervisors or administrative officers of China Merchants Group will be directly submitted to Stock Exchange and Registration and Settlement Company with locking applied; In case of Board of Directors failing to submit identity information and account information on directors, supervisors or administrative officers of China Merchants Group to Stock Exchange and Registration and Settlement Company, Stock Exchange and Registration and Settlement Company will be authorized to directly lock related shares. In case that the situation of violating laws and rules is found upon investigation conclusion, directors, supervisors or administrative officers of China Merchants Group promise locked shares are voluntarily used for compensating related investors. | 26 July 2018 | Effective continuously | Ongoing |
| CMG Hong Kong | Other commitment | 1. CMG Hong Kong ensures related information provided for the transaction is true, accurate and complete without false record, misleading statement or important omission; 2. CMG Hong Kong ensures the data provided to CMPort and all intermediary organs participating in the transaction is true, accurate and complete original written data or data copy. Data copy is consistent with original data and signature and seal of all the documents are true. The signatory of such documents is legally authorized and effectively signs such documents without any false record, misleading statement or important omission; 3. CMG Hong Kong ensures descriptions and confirmations issued for the transaction is true, accurate and complete without false record, misleading statement or important omission; 4. CMG Hong Kong ensures that statutory disclosure and report obligation has been performed, and no contracts, agreements, arrangements or miscellaneous that should have been disclosed exists; 5. The CMG Hong Kong made the commitment that if the information provided or disclosed by this transaction is suspected of false records, misleading statements or major omissions, and is investigated by the judicial authorities or investigated by the China Securities Regulatory Commission (CSRC), it does not transfer the shares that have interests in listed Company, and submit the written application and stock account of the suspension of the transfer to the Board of Directors of the CMPort within two trading days after receiving the filing inspection notice, and the Board of Directors shall apply for lock-up on behalf of the CMG Hong Kong to the Stock Exchange and Registration and Settlement Company. In case of failing to file a locking application within two transaction days and after the Board of Directors is authorized for verification, identity information and account information on CMG Hong Kong will | 26 July 2018 | Effective continuously | Ongoing |
be directly submitted to Stock Exchange and Registration andSettlement Company with locking applied; In case of Board ofDirectors failing to submit identity information and accountinformation on CMG Hong Kong to Stock Exchange andRegistration and Settlement Company, Stock Exchange andRegistration and Settlement Company will be authorized todirectly lock related shares. If the investigation finds that there isa violation of the law, CMG Hong Kong committed to lock theshares voluntarily for the relevant investor compensation; 6. IfCMG Hong Kong promises to related document, data andinformation provided in the reorganization process aren't true,accurate or complete or are with false record, misleadingstatement or important omission, CMG Hong Kong is willing tolegally bear corresponding legal responsibility; 7. In case ofCMG Hong Kong violating the above promise, incurring lossesto CMPort, CMG Hong Kong will take correspondingcompensation responsibility.
| be directly submitted to Stock Exchange and Registration and Settlement Company with locking applied; In case of Board of Directors failing to submit identity information and account information on CMG Hong Kong to Stock Exchange and Registration and Settlement Company, Stock Exchange and Registration and Settlement Company will be authorized to directly lock related shares. If the investigation finds that there is a violation of the law, CMG Hong Kong committed to lock the shares voluntarily for the relevant investor compensation; 6. If CMG Hong Kong promises to related document, data and information provided in the reorganization process aren't true, accurate or complete or are with false record, misleading statement or important omission, CMG Hong Kong is willing to legally bear corresponding legal responsibility; 7. In case of CMG Hong Kong violating the above promise, incurring losses to CMPort, CMG Hong Kong will take corresponding compensation responsibility. | |||||
| CMPID | Other commitment | 1. CMPID ensures related information provided for the transaction is true, accurate and complete without false record, misleading statement or important omission; 2. CMPID ensures the data provided to CMPort and all intermediary organs participating in the transaction is true, accurate and complete original written data or data copy. Data copy is consistent with original data and signature and seal of all the documents are true. The signatory of such documents is legally authorized and effectively signs such documents without any false record, misleading statement or important omission; 3. CMPID ensures description and confirmation provided for the transaction are true, accurate and complete without any false record, misleading statement or important omission; 4. CMPID ensures that statutory disclosure and report obligation has been performed, and no contracts, agreements, arrangements or miscellaneous that should have been disclosed exists; 5. The CMPID made the commitment that if the information provided or disclosed by this transaction is suspected of false records, misleading statements or major omissions, and is investigated by the judicial authorities or investigated by the China Securities Regulatory Commission (CSRC), it does not transfer the shares that have interests in CMPort, and submit the written application and stock account of the suspension of the transfer to the Board of Directors of the CMPort within two trading days after receiving the filing inspection notice, and the Board of Directors shall apply for lock-up on behalf of the CMG Hong Kong to the Stock Exchange and Registration and Settlement Company. If the application for lock-up is not submitted within two transaction days, the Board of Directors is authorized to verify and submit the identity information and account information of CMPID directly to the Stock Exchange and Registration and Settlement Company and apply for lock-up; If the Board of Directors fails to submit the identity information and account information of the CMPID to the Stock Exchange and Registration and Settlement Company, then the Stock Exchange and Registration and Settlement Company shall be authorized to directly lock the relevant shares. If the investigation finds that there is a violation of the law, CMPID committed to lock the shares voluntarily for the relevant investor compensation; 6. If CMPID promises to related document, data and information provided in the reorganization process aren't true, accurate or complete or are with false record, misleading statement or important omission, CMPID is willing to legally bear corresponding legal responsibility; 7. In case of CMPID violating the above commitment, incurring losses to CMPort, CMPID will take corresponding compensation responsibility. | 26 July 2018 | Effective continuously | Ongoing |
| CMPort Holdings | Other commitment | 1. CMPort Holdings ensures related information provided for the transaction is true, accurate and complete without false record, misleading statement or important omission; 2. CMPort | 26 July 2018 | Effective continuously | Ongoing |
Holdings ensures the data provided to CMPort and allintermediary organs participating in the transaction is true,accurate and complete original written data or data copy. Datacopy is consistent with original data and signature and seal of allthe documents are true. The signatory of such documents islegally authorized and effectively signs such documents withoutany false record, misleading statement or important omission; 3.CMPort Holdings ensures description and confirmation providedfor the transaction are true, accurate and complete without anyfalse record, misleading statement or important omission; 4.CMPort Holdings ensures that statutory disclosure and reportobligation has been performed, and no contracts, agreements,arrangements or miscellaneous that should have been disclosedexists; 5. CMPort Holdings made the commitment that if theinformation provided or disclosed by this transaction issuspected of false records, misleading statements or majoromissions, and is investigated by the judicial authorities orinvestigated by the China Securities Regulatory Commission(CSRC); CMPort Holdings committed that if CMPort Holdingsviolated the above promise, incurring losses to CMPort, CMPortHoldings will take corresponding compensation responsibility.
| Holdings ensures the data provided to CMPort and all intermediary organs participating in the transaction is true, accurate and complete original written data or data copy. Data copy is consistent with original data and signature and seal of all the documents are true. The signatory of such documents is legally authorized and effectively signs such documents without any false record, misleading statement or important omission; 3. CMPort Holdings ensures description and confirmation provided for the transaction are true, accurate and complete without any false record, misleading statement or important omission; 4. CMPort Holdings ensures that statutory disclosure and report obligation has been performed, and no contracts, agreements, arrangements or miscellaneous that should have been disclosed exists; 5. CMPort Holdings made the commitment that if the information provided or disclosed by this transaction is suspected of false records, misleading statements or major omissions, and is investigated by the judicial authorities or investigated by the China Securities Regulatory Commission (CSRC); CMPort Holdings committed that if CMPort Holdings violated the above promise, incurring losses to CMPort, CMPort Holdings will take corresponding compensation responsibility. | |||||
| CMG | Other commitment | 1. China Merchants Group ensures related information provided for the transaction is true, accurate and complete without false record, misleading statement or important omission; 2. China Merchants Group ensures the data provided to CMPort and all intermediary organs participating in the transaction is true, accurate and complete original written data or data copy. Data copy is consistent with original data and signature and seal of all the documents are true. The signatory of such documents is legally authorized and effectively signs such documents without any false record, misleading statement or important omission; 3. China Merchants Group ensures descriptions and confirmations issued for the transaction is true, accurate and complete without false record, misleading statement or important omission; 4. China Merchants Group ensures that statutory disclosure and report obligation has been performed, and no contracts, agreements, arrangements or miscellaneous that should have been disclosed exists; 5. China Merchants Group made the commitment that if the information provided or disclosed by this transaction is suspected of false records, misleading statements or major omissions, and is investigated by the judicial authorities or investigated by the China Securities Regulatory Commission (CSRC), it does not transfer the shares that have interests in CMPort, and submit the written application and stock account of the suspension of the transfer to the Board of Directors of the CMPort within two trading days after receiving the filing inspection notice, and the Board of Directors shall apply for lock-up on behalf of China Merchants Group to the Stock Exchange and Registration and Settlement Company. In case of failing to file a locking application within two transaction days and after the Board of Directors is authorized for verification, identity information and account information of China Merchants Group will be directly submitted to Stock Exchange and Registration and Settlement Company with locking applied; In case of Board of Directors failing to submit identity information and account information of China Merchants Group to Stock Exchange and Registration and Settlement Company, Stock Exchange and Registration and Settlement Company will be authorized to directly lock related shares. If the investigation finds that there is a violation of the law, China Merchants Group committed to lock the shares voluntarily for the relevant investor compensation; 6. If China Merchants Group promises to related document, data and information provided in the reorganization process aren't true, accurate or complete or are with false record, misleading statement or important omission, China Merchants Group is willing to legally bear corresponding legal | 26 July 2018 | Effective continuously | Ongoing |
responsibility; In case of China Merchants Group violating theabove promise, incurring losses to CMPort, China MerchantsGroup will take corresponding compensation responsibility.
| responsibility; In case of China Merchants Group violating the above promise, incurring losses to CMPort, China Merchants Group will take corresponding compensation responsibility. | ||||||
| Chiwan Wharf and all directors, supervisors and senior management | Other commitment | Chiwan Wharf and all its directors, supervisors and administrative officers ensure the transaction report, its abstract, other information provided for the transaction and application document are true, accurate and complete without false record, misleading statement or important omission as well as take individual and joint legal liability for false record, misleading statement or important omission. If the information provided or disclosed by this transaction is suspected of false records, misleading statements or major omissions, and is investigated by the judicial authorities or investigated by the China Securities Regulatory Commission (CSRC), the directors, supervisors, or senior managers of Chiwan Wharf do not transfer the shares that have interests in CMPort, and submit the written application and stock account of the suspension of the transfer to the Board of Directors of the CMPort within two trading days after receiving the filing inspection notice, and the Board of Directors shall apply for lock-up on behalf of them to the Stock Exchange and Registration and Settlement Company. In case of failing to file a locking application within two transaction days and after the Board of Directors is authorized for verification, identity information and account information on directors, supervisors or administrative officers of Chiwan Wharf will be directly submitted to Stock Exchange and Registration and Settlement Company with locking applied; In case of Board of Directors failing to submit identity information and account information on directors, supervisors or administrative officers of Chiwan Wharf to Stock Exchange and Registration and Settlement Company, Stock Exchange and Registration and Settlement Company will be authorized to directly lock related shares. In case that the situation of violating laws and rules is found upon investigation conclusion, directors, supervisors or administrative officers of Chiwan Wharf promise locked shares are voluntarily used for compensating related investors. | 26 July 2018 | Effective continuously | Ongoing | |
| Other commitments made to minority shareholders | China Nanshan Development (Group) Inc. | Other commitment | CND Group will irrevocably and unconditionally agrees it will ensure transferee of such land use right and its successor and assignee will be fully exempted from responsibility for the above matters in case of CMPort encountering losses, needing to bear expenses and liabilities, undergoing claim for compensation or needing to file a lawsuit due to any actual or potential illegal and unenforceable issues incurred by land use agreement and relevant documents signed and to be signed by it. | 20 March 2001; 18 June 2003; 29 September 2004 | Effective continuously | Ongoing |
| China Nanshan Development (Group) Inc. | Other commitment | In order to properly solve the issue regarding the ownership of the land of 270,692 square meters transferred to CMPort by CND Group as a contribution, CND Group hereby irrevocably undertakes as follows: 1. CND Group affirms the historical fact that it contributed to the restructuring and listing of Chiwan Wharf with the right to use 270,692 square meters of land in 1993. Besides, it affirms that the 270,692 square meters of land has been transferred to CMPort (formerly known as Chiwan Wharf) and the right to use the land is owned by CMPort. 2. CND Group will continue keeping the original undertaking and ensure that the signing of the relevant agreement will not damage CMPort's rights and interests of 148,119 square meters of land transferred in 1993 to CMPort (formerly, Chiwan Wharf) as a contribution. 3. CND Group will continue giving full play to its advantages to fully support land-related authorities in Shenzhen City to secure CMPort's right to use the 270,692 square meters of land. Moreover, CND Group will continue to actively assist CMPort in going through the corresponding procedures for the change of ownership of property rights and perfect legal procedures related to the right to use the land (e.g., defining the boundary line of | 2 July 2020 | Effective continuously | Ongoing |
land, land surveying, and claiming for the certificate of land). Inaddition, CND Group undertakes to cover all costs incurredaccordingly (including the land premium). 4. All consequentlosses to CMPort shall be borne by CND Group, should the latterbreak the above undertaking. Furthermore, CND Group willshoulder all liabilities for damage, if the asset integrity of thelisted company, CMPort, is damaged.
| land, land surveying, and claiming for the certificate of land). In addition, CND Group undertakes to cover all costs incurred accordingly (including the land premium). 4. All consequent losses to CMPort shall be borne by CND Group, should the latter break the above undertaking. Furthermore, CND Group will shoulder all liabilities for damage, if the asset integrity of the listed company, CMPort, is damaged. | ||||||
| 首次公开发行或再融资时所作承诺 | CMG | Commitments when refinancing | CMPort issued 576,709,537 RMB ordinary shares (A shares) to specific targets in a non-public manner, and the fund raised in this non-public offering is RMB10,917,111,500. In order to ensure that the compensation measures for the dilution of immediate returns in this non-public offering can be effectively implemented, in accordance with the Opinions of the General Office of the State Council on Further Strengthening the Work of Protection of the Legitimate Rights and Interests of Minority Investors in the Capital Markets (G.B.F. [2013 No. 110), the Guiding Opinions on Matters concerning the Dilution of Immediate Return in Initial Public Offering, Refinancing and Material Asset Restructuring (Announcement of the China Securities Regulatory Commission [2015] No. 31) and other laws, regulations and normative documents, as the controlling shareholder and actual controller of the issuer of the non-public offering, I hereby make a commitment as follows concerning the dilution of immediate returns and compensation measures in connection with the non-public offering: 1. I will not interfere in the operation and management activities of the Company beyond its authority and will not encroach on its interests. 2. From the date of issuance of this commitment to the completion of the non-public offering of the Company, if the regulatory authority has other requirements on the measures to compensate the returns and the relevant provisions of the commitment, and the commitment cannot meet the relevant requirements of the regulatory authority, I will make a supplementary commitment in accordance with relevant regulations. | 13 July 2021 | Effective continuously | Ongoing |
| CMG | Commitments when refinancing | CMPort issued 576,709,537 RMB ordinary shares (A shares) to specific targets in a non-public manner, and the fund raised by this non-public offering is RMB10,917,111,500, which will be subscribed by Seaport Group in a lump sum in cash. As the actual controller of CMPort, the company hereby make a commitment as follows: In connection with this non-public offering, the company does not provide financial assistance, compensation, promise of benefits or other similar arrangements to Seaport Group, directly or through its stakeholders. | 16 November 2021 | Effective continuously | Ongoing | |
| Broadford Global | Commitments when refinancing | CMPort issued 576,709,537 RMB ordinary shares (A shares) to specific targets in a non-public manner, and the fund raised in this non-public offering is RMB10,917,111,500. In order to ensure that the compensation measures for the dilution of immediate returns in this non-public offering can be effectively implemented, in accordance with the Opinions of the General Office of the State Council on Further Strengthening the Work of Protection of the Legitimate Rights and Interests of Minority Investors in the Capital Markets (G.B.F. [2013 No. 110), the Guiding Opinions on Matters concerning the Dilution of Immediate Return in Initial Public Offering, Refinancing and Material Asset Restructuring (Announcement of the China Securities Regulatory Commission [2015] No. 31) and other laws, regulations and normative documents, as the controlling shareholder and actual controller of the issuer of the non-public offering, I hereby make a commitment as follows concerning the dilution of immediate returns and compensation measures in connection with the non-public offering: 1. I will not interfere in the operation and management activities of the Company beyond its authority and will not encroach on its interests. | 13 July 2021 | Effective continuously | Ongoing |
2. From the date of issuance of this commitment to thecompletion of the non-public offering of the Company, if theregulatory authority has other requirements on the measures tocompensate the returns and the relevant provisions of thecommitment, and the commitment cannot meet the relevantrequirements of the regulatory authority, I will make asupplementary commitment in accordance with relevantregulations.
| 2. From the date of issuance of this commitment to the completion of the non-public offering of the Company, if the regulatory authority has other requirements on the measures to compensate the returns and the relevant provisions of the commitment, and the commitment cannot meet the relevant requirements of the regulatory authority, I will make a supplementary commitment in accordance with relevant regulations. | |||||
| Broadford Global | Commitments when refinancing | CMPort issued 576,709,537 RMB ordinary shares (A shares) to specific targets in a non-public manner, and the fund raised by this non-public offering is RMB10,917,111,500, which will be subscribed by Seaport Group in a lump sum in cash. As the controlling shareholder of CMPort, the company hereby make a commitment as follows: In connection with this non-public offering, the company does not provide financial assistance, compensation, promise of benefits or other similar arrangements to Seaport Group, directly or through its stakeholders. | 16 November 2021 | Effective continuously | Ongoing |
| Directors and senior management of CMPort | Commitments when refinancing | CMPort issued 576,709,537 RMB ordinary shares (A shares) to specific targets in a non-public manner, and the fund raised in this non-public offering is RMB10,917,111,500. In order to ensure that the compensation measures for the dilution of immediate returns in this non-public offering can be effectively implemented, in accordance with the Opinions of the General Office of the State Council on Further Strengthening the Work of Protection of the Legitimate Rights and Interests of Minority Investors in the Capital Markets (G.B.F. [2013 No. 110), the Guiding Opinions on Matters concerning the Dilution of Immediate Return in Initial Public Offering, Refinancing and Material Asset Restructuring (Announcement of the China Securities Regulatory Commission [2015] No. 31) and other laws, regulations and normative documents, as a director and senior management member of the issuer of the non-public offering, I hereby make a commitment as follows concerning the dilution of immediate returns and compensation measures in connection with the non-public offering: 1. I will not transfer benefits to other units or individuals for free or under unfair conditions, nor will I damage the interests of the Company in other ways. 2. I will regulate my personal business consumption behavior. 3. I will not use the Company's assets to engage in investment and consumption activities unrelated to the performance of my duties. 4. The salary system formulated by the board of directors or the remuneration committee is linked to the implementation of the Company's return compensation measures. 5. If the Company intends to implement equity incentives, the exercise conditions of such equity incentive are linked to the implementation of the Company's return compensation measures. 6. From the date of issuance of this commitment to the completion of the non-public offering of the Company, if the regulatory authority has other requirements on the measures to compensate the returns and the relevant provisions of the commitment, and the commitment cannot meet the relevant requirements of the regulatory authority, I will make supplementary commitments in accordance with relevant regulations. | 13 July 2021 | Effective continuously | Ongoing |
| CMPort | Commitments when refinancing | CMPort issued 576,709,537 RMB ordinary shares (A shares) to specific targets in a non-public manner, the fund raised in this non-public offering is RMB10,917,111,500. In order to further ensure the use of the funds raised in this non-public offering, the Company makes statements as follows: 1. The Company intends to use the proceeds of this non-public share offering to supplement working capital and repay debts, and it does not involve real estate development projects. | 29 September 2021 | Effective continuously | Ongoing |
2. The fund raised by the Company in this non-public offering
shall not be used for real estate development or in a disguisedform.
| 2. The fund raised by the Company in this non-public offering shall not be used for real estate development or in a disguised form. | ||||||
| CMPort | Commitments when refinancing | CMPort issued 576,709,537 RMB ordinary shares (A shares) to specific targets in a non-public manner, and the fund raised by this non-public offering is RMB10,917,111,500, which will be subscribed by Seaport Group in a lump sum in cash. The Company hereby makes commitments as follows: In connection with this non-public offering, the Company does not make a commitment on guarantee income or disguised guarantee income to Seaport Group, nor does it provide financial assistance, compensation, promise of benefits or other similar arrangements to Seaport Group, directly or through its stakeholders. | 29 September 2021 | Effective continuously | Ongoing | |
| CMPort | Commitments when refinancing | CMPort issued 576,709,537 RMB ordinary shares (A shares) to specific targets in a non-public manner, and the fund raised by this non-public offering is RMB10,917,111,500. The Company hereby makes the following commitments regarding the Qualification Certificate of Real Estate Development Enterprise of the People's Republic of China (Number: SH.F.K.Z. (2017) No. 879) obtained by Shenzhen Jinyu Rongtai Investment Development Co., Ltd (hereinafter referred to as "Jinyu Rongtai"), a wholly-owned subsidiary of the Company: The Company will actively coordinate Jinyu Rongtai to handle the cancellation of the aforesaid real estate development qualification certificate. Within 30 days after approval of relevant laws and regulations, regulatory regulations and competent housing authorities, Jinyu Rongtai will apply to the competent housing department for the cancellation of real estate development qualification registration. Before the cancellation or expiration of the qualification, the Company and Jinyu Rongtai will not use the qualification to engage in real estate development and operation and other related businesses. After qualification cancellation or invalidity, qualification renewal or new real estate development qualification will not be handled. | 19 November 2021 | Effective continuously | Ongoing | |
| CMPort | Commitments when refinancing | CMPort issued 576,709,537 RMB ordinary shares (A shares) to specific targets in a non-public manner, and the fund raised by this non-public offering is RMB10,917,111,500, which will be subscribed by Zhejiang Provincial Seaport Investment & Operation Group Co., Ltd. in a lump sum in cash. The Company makes commitments in connection with the fund raised in this non-public offering as follows: The proceeds from this non-public offering of shares will not flow into China Nanshan Development (Group) Co., Ltd. through any direct or indirect means. | 16 December 2021 | Effective continuously | Ongoing | |
| CMPort | Commitments when refinancing | CMPort issued 576,709,537 RMB ordinary shares (A shares) to specific targets in a non-public manner, and the fund raised by this non-public offering is RMB10,917,111,500, which will be subscribed by Zhejiang Provincial Seaport Investment & Operation Group Co., Ltd. in a lump sum in cash. The Company hereby makes commitments as follows: Prior to the completion of the use of the fund raised in this non-public offering or within 36 months after the fund is raised, no additional investment (including capital increase, loan, guarantee and capital investment in other forms) shall be made in industrial funds and M&A funds that do not conform to the Company's upstream and downstream industrial chain or the Company's main business and strategic development direction. | 7 January 2022 | Effective continuously | Ongoing | |
| 其他承诺 | CMPort | Commitments when subscribing shares of Ningbo Port | Ningbo Port issued A shares to CMPort in a non-public manner. As the subscription target of Ningbo Port's 2021 non-public offering of A-shares, CMPort irrevocably makes the following statements and commitments: Ningbo Port's 2021 non-public offering of A-shares is Ningbo Port's non-public offering of A-shares to CMPort. After the completion of Ningbo Port's non-public offering of A-shares to CMPort, the business relationship and management relationship between Ningbo Zhoushan Port Group, Seaport Group and the | 13 July 2021 | Effective continuously | Ongoing |
subordinate enterprises controlled by them and Ningbo Port willnot change substantially, and it will not lead to new or potentialcompetition in the same industry between Ningbo Port andNingbo Zhoushan Port Group, Seaport Group and thesubordinate enterprises controlled by them. Assuming that3,646,971,029 shares are issued (i.e., 23.07% of the total sharecapital prior to issuance), after the completion of Ningbo Port'snon-public offering of A-shares to CMPort, CMPort holds
20.98% shares of Ningbo Port and 2.10% shares of Ningbo Port
through China Merchants Ningbo. Thus, CMPort holds 23.08%shares of Ningbo Port in total. It will not lead to changes in thecontrolling shareholder and actual controller of Ningbo Port, soit will not lead to new or potential competition between NingboPort and CMPort and its controlling shareholder and actualcontroller.CMPort warrants that it has the right to enter into this Letter ofStatements and Commitments, and once this Letter of Statementsand Commitments is entered into by CMPort, it will constitutean effective, legal and binding responsibility upon the CMPort,and this Letter of Statements and Commitments will remain validand irrevocable during the period when CMPort is as ashareholder of Ningbo Port. CMPort warrants that it will strictlyfulfil all commitments in this Letter of Statements andCommitments. In case of any loss caused to Ningbo Port due toits violation of this Letter of Statements and Commitments,CMPort will bear relevant legal responsibilities.
| subordinate enterprises controlled by them and Ningbo Port will not change substantially, and it will not lead to new or potential competition in the same industry between Ningbo Port and Ningbo Zhoushan Port Group, Seaport Group and the subordinate enterprises controlled by them. Assuming that 3,646,971,029 shares are issued (i.e., 23.07% of the total share capital prior to issuance), after the completion of Ningbo Port's non-public offering of A-shares to CMPort, CMPort holds 20.98% shares of Ningbo Port and 2.10% shares of Ningbo Port through China Merchants Ningbo. Thus, CMPort holds 23.08% shares of Ningbo Port in total. It will not lead to changes in the controlling shareholder and actual controller of Ningbo Port, so it will not lead to new or potential competition between Ningbo Port and CMPort and its controlling shareholder and actual controller. CMPort warrants that it has the right to enter into this Letter of Statements and Commitments, and once this Letter of Statements and Commitments is entered into by CMPort, it will constitute an effective, legal and binding responsibility upon the CMPort, and this Letter of Statements and Commitments will remain valid and irrevocable during the period when CMPort is as a shareholder of Ningbo Port. CMPort warrants that it will strictly fulfil all commitments in this Letter of Statements and Commitments. In case of any loss caused to Ningbo Port due to its violation of this Letter of Statements and Commitments, CMPort will bear relevant legal responsibilities. | |||||
| CMPort | Commitments when subscribing shares of Ningbo Port | CMPort fully subscribed the shares issued through non-public offering by Ningbo Port with cash. It is expected that after the issuance, CMPort and its subsidiary China Merchants Ningbo will hold about 23.08% of shares of Ningbo Port in total. CMPort and Ningbo Port continue to be independent from each other in assets, personnel, finance, organization and business. The A-shares issued by Ningbo Port to CMPort through non-public offering will not affect the independent operation ability of Ningbo Port. The statements on the independent operation of Ningbo Port after the completion of its non-public offering of A-shares to CMPort are as follows: i. Independent assets After the non-public offering of A-shares by Ningbo Port to CMPort, Ningbo Port still has complete and independent ownership of all its assets, which are strictly separated from the assets of CMPort and completely operated independently. There is no mixed operation, unclear assets, or fund or assets occupied by CMPort. ii. Independent personnel After the non-public offering of A-shares by Ningbo Port to CMPort, Ningbo Port will continue to have an independent and complete labor and personnel management system, which is completely independent from CMPort. The selection of directors, supervisors, managers and other senior management personnel recommended by CMPort to Ningbo Port shall be carried out through legal procedures. CMPort shall not interfere with the personnel appointment and removal decisions made by the board of directors and the general meeting of Ningbo Port. iii. Independent finance After the non-public offering of A-shares by Ningbo Port to CMPort, Ningbo Port will continue to maintain an independent financial accounting department, operate an independent accounting system and independent a financial management system. It will keep its independent bank account and will not share the bank account with CMPort. It will pay taxes independently and make independent financial decisions, and CMPort will not interfere in the use of funds of Ningbo Port. CMPort will not interfere with the use of funds of Ningbo Port in any illegal or rule-violating way, and Ningbo Port will not provide guarantee for other enterprises controlled by CMPort. | 13 July 2021 | Effective continuously | Ongoing |
No Ningbo Port's financial employee will work part-time inCMPort.iv. Independent organizationsNingbo Port will continue to maintain a sound corporategovernance structure of joint-stock company. It has anindependent and complete organizational structure. Its generalmeeting, board of directors, independent directors, board ofsupervisors and senior management exercise their functions andpowers independently in accordance with laws, regulations andarticles of association. It is in no subordinate or controllingrelationship with the functional departments of other enterprisescontrolled by CMPort.v. Independent businessNingbo Port has an independent management system, assets,personnel, venues and brands to carry out businessindependently, and the ability to operate independently andcontinuously in the market. CMPort will not intervene in NingboPort's business activities other than the exercise of its rights as ashareholder.
| No Ningbo Port's financial employee will work part-time in CMPort. iv. Independent organizations Ningbo Port will continue to maintain a sound corporate governance structure of joint-stock company. It has an independent and complete organizational structure. Its general meeting, board of directors, independent directors, board of supervisors and senior management exercise their functions and powers independently in accordance with laws, regulations and articles of association. It is in no subordinate or controlling relationship with the functional departments of other enterprises controlled by CMPort. v. Independent business Ningbo Port has an independent management system, assets, personnel, venues and brands to carry out business independently, and the ability to operate independently and continuously in the market. CMPort will not intervene in Ningbo Port's business activities other than the exercise of its rights as a shareholder. | |||||
| CMPort | Commitments when subscribing shares of Ningbo Port | Ningbo Port issued A-shares to CMPort in a non-public manner. As the subscription target of Ningbo Port's 2021 non-public offering of A-shares, CMPort makes the following commitments: The fund used by CMPort to subscribe for the 2021 non-public offering of A-shares by Ningbo Port in accordance with the Share Subscription Agreement between Ningbo Zhoushan Port Company Limited and China Merchants Port Group Co., Ltd. is self-owned fund or self-raised fund. There is no external fund raising, proxy holding, structural arrangement or direct or indirect use of funds of Ningbo Zhoushan Port Company Limited and its related parties for this subscription. There is no financial support, compensation, promise of income or other arrangements by Ningbo Zhoushan Port Company Limited or its controlling shareholder or actual controller to CMPort directly or through its stakeholders. | 13 July 2021 | Effective continuously | Ongoing |
| CMPort | Commitments when subscribing shares of Ningbo Port | CMPort fully subscribed the shares issued through non-public offering by Ningbo Port with cash. It is expected that after the issuance, CMPort and its subsidiary China Merchants Ningbo will hold about 23.08% of shares of Ningbo Port in total. CMPort's statements on non-transfer within 36 months after completion of subscription are as follows: The shares non-publicly offered by Ningbo Port that CMPort subscribes shall not be transferred within 36 months from the date of the end of the non-public offering of A-shares by Ningbo Port to CMPort. The shares derived from the company's distribution of stock dividends and the conversion of capital reserve fund into equity regarding the shares subscribed for by CMPort through this non-public offering shall also comply with the above lock-in arrangement. | 13 July 2021 | Effective continuously | Ongoing |
| CMPort | Commitments when subscribing shares of Ningbo Port | CMPort makes the following commitments regarding the reduction of shares involved in the 2021 non-public offering of A-shares by Ningbo Port: 1. CMPort, its persons acting in concert and related parties controlled by CMPort have not reduced their holdings of shares of Ningbo Port from the six months prior to benchmark pricing date of Ningbo Port's 2021 non-public offering of A-shares to the date of issuance of this Letter of Commitment. 2. CMPort, its persons acting in concert and related parties controlled by CMPort will not have the plan to reduce their holdings of shares of Ningbo Port from the date of issuance of this Letter of Commitment to the six months after the completion of Ningbo Port's 2021 non-public offering of A-shares. 3. CMPort, its persons acting in concert and related parties controlled by CMPort will not violate Article 44 of the Securities Law of the People's Republic of China. 4. In case of any violation of the above commitments, the income from the reduction in holdings of shares of Ningbo Port obtained | 18 November 2021 | Effective continuously | Ongoing |
by CMPort, its persons acting in concert and related partiescontrolled by CMPort will all be owned by Ningbo Port, and theybear the legal liabilities arising therefrom according to law.
| by CMPort, its persons acting in concert and related parties controlled by CMPort will all be owned by Ningbo Port, and they bear the legal liabilities arising therefrom according to law. | ||||||
| CMPort | Commitments when subscribing shares of Ningbo Port | Ningbo Port intends to offer 3,646,971,029 RMB-denominated ordinary shares (A shares) to CMPort in a non-public manner, and the Company intends to participate in the subscription as a strategic investor and undertakes as follows: In addition to becoming a strategic investor of Ningbo Port via subscribing for the shares offered in a non-public manner this time, the Company does not subscribe for the shares offered in a non-public manner by any listed company in the same industry as Ningbo Port as a strategic investor and will not do so within 36 months upon obtaining the shares offered by Ningbo Port in a non-public manner this time. | 28 July 2022 | Effective continuously | Ongoing | |
| Whether fulfilled on time | Yes | |||||
| Specific reasons for failing to fulfil commitments on time and plans for next step (if any) | N/A | |||||
2. Where there Had Been an Earnings Forecast for an Asset or Project and the ReportingPeriod Was still within the Forecast Period, Explain why the Forecast Has Been Reached forthe Reporting Period.? Applicable √ Not applicableII Occupation of the Company’s Capital by the Controlling Shareholder or Its Related Partiesfor Non-Operating Purposes? Applicable √ Not applicableDuring the Reporting Period, the controlling shareholder or its related parties did not occupy capitalor repay for non-operating purposes. Deloitte Touche Tohmatsu Certified Public Accountants LLPissued the Special Report on Occupation of the Company’s Capital by the Controlling Shareholder,the Actual Controller and Other Related Parties, and please refer to www.cninfo.com.cn for details.III Irregularities in the Provision of Guarantees
□ Applicable √ Not applicable
No such cases in the Reporting Period.IV Explanations Given by the Board of Directors Regarding the Independent Auditor’s
“Modified Opinion” on the Financial Statements of the Latest Period
□ Applicable √ Not applicable
V Explanations Given by the Board of Directors, the Supervisory Committee and IndependentDirectors (if any) Regarding the Independent Auditor’s “Modified Opinion” on the FinancialStatements of the Reporting Period
□ Applicable √ Not applicable
VI YoY Changes to Accounting Policies, Estimates or Correction of Material AccountingErrorsOn 30 November 2022, the Ministry of Finance issued the Interpretation No. 16 of the AccountingStandards for Business Enterprises (C.K. [2022] No. 31, hereinafter referred to as “Interpretation No.16”). In Interpretation No. 16, the provision that “accounting processing under initial recognition andexemption is not applicable to deferred income taxes related to assets and liabilities incurred from asingle transaction” will enter into force on 1 January 2023. The Company has implemented thisprovision from 1 January 2023 in accordance with the relevant rules and regulations of the Ministryof Finance mentioned above. For details, please refer to the Announcement on Changes in AccountingPolicies (Announcement No. 2023-043) published by the Company on 29 April 2023 onwww.cninfo.com.cn.For details of the impact of changes in accounting policies and accounting estimates, please refer to“VI. Changes in significant accounting policies and estimates” in the “Section X Financial Report”of the Report.VII YoY Changes to the Scope of the Consolidated Financial StatementsThe Proposal on the Transfer of 45% Equity Interest in Ningbo Daxie China Merchants InternationalTerminals Co., Ltd. by a Majority-owned Subsidiary through Public Tender was approved at theSecond Extraordinary Meeting of the 10
th
Board of Directors of the Company in 2023 dated 20 March2023. As such, CYBER CHIC COMPANY LIMITED (hereinafter referred to as “CYBER CHIC”),
a subsidiary of the Company, was approved to transfer its 45% equity interest in Ningbo Daxie ChinaMerchants International Container Terminal Co., Ltd. (hereinafter referred to as “CMICT”) throughpublic tender on the China Beijing Equity Exchange. On 20 April 2023, CYBER CHIC put its 45%equity interest in CMICT to a public tender on the China Beijing Equity Exchange. On 19 May 2023,Ningbo Zhoushan Port Company Limited (hereinafter referred to as “Ningbo Zhoushan Port”)became the transferee, with a transaction price of RMB1,845 million. On 25 May 2023, CYBERCHIC and Ningbo Zhoushan Port entered into the Equity Transaction Contract. On 8 August 2023,CMICT changed its registered information with the competent industrial and commercialadministration and received its new business license upon the equity transfer, with its name changedto “Ningbo Daxie Container Terminal Co., Ltd.” (hereinafter refer to as “Ningbo Daxie”). As such,the equity transfer has been completed and CYBER CHIC no longer holds equity interest in NingboDaxie, and Ningbo Daxie is no longer a subsidiary within the scope of the Company’s consolidatedfinancial statements.On 26 September 2023, the Company held the 4th Extraordinary Meeting of the 11th the Board ofDirectors for 2023 to review and approve the Proposal on the Transfer and Acquisition of EquityInterests in Relevant Subsidiaries and Related-party Transactions (the “Transaction”). Accordingly,China Merchants International Technology Company Limited (CMIT) subordinate to the Company,transferred 100% share of Yingkou Port Information Technology Co., Ltd. (YPIT), and 79.03% shareof Dalian Port Logistics Network Co., Ltd. (DPN) to Liaoning Port Co., Ltd. (Liaoning Port). Besides,the Company acquired 22.3779%, 13.2563% and 7.4495% (43.0837% in aggregate) of the share inCMIT held respectively by Dalian Port Container Development Co., Ltd. (DPCD), Dalian Port JifaLogistics Co., Ltd. (Jifa Logistics) and Yingkou Port Group Co., Ltd. (Yingkou Port Group). DPCD,Jifa Logistics and Yingkou Port Group are all majority-owned subsidiaries of the related party,Liaoning Port Group Co., Ltd. (Liaoning Port Group) Limited. In November 2023, YPIT and DPNcompleted the business registration changes in connection with the Transaction. As a result, YPITand DPN were no longer subsidiaries included in the Company’s consolidated financial statements.
VIII Engagement and Disengagement of Independent AuditorCurrent independent auditor
Name of the domestic independent auditor
| Name of the domestic independent auditor | Deloitte Touche Tohmatsu Certified Public Accountants LLP |
| The Company’s payment to the domestic independent auditor (RMB’0,000) | 708.83 |
| How many consecutive years the domestic independent auditor has provided audit service for the Company | 12 |
| Names of the certified public accountants from the domestic independent auditor writing signatures on the auditor’s report | Li Weihua, Wang Hongmei |
| How many consecutive years the certified public accountants have provided audit service for the Company | 2 |
| Name of the overseas independent auditor (if any) | Deloitte Touche Tohmatsu |
| The Company’s payment to the overseas independent auditor (RMB’0,000) (if any) | 343.45 |
| How many consecutive years the overseas independent auditor has provided audit service for the Company (if any) | 12 |
| Names of the certified public accountants from the overseas independent auditor writing signatures on the auditor’s report (if any) | Hu Jinghua |
| How many consecutive years the certified public accountants have provided audit service for the Company (if any) | 3 |
Indicate by tick mark whether the independent auditor was changed for the Reporting Period.? Yes √ NoIndependent auditor, financial advisor or sponsor engaged for the audit of internal controls:
Approved by the 7th Meeting of the 10th Board of Directors in 2023 and 2022 Annual GeneralMeeting of the Company, the Company was allowed to continuously engage Deloitte ToucheTohmatsu Certified Public Accountants LLP as the 2023 independent auditor for the audit of annualfinancial statements and internal control in the 2023. The audit price for 2023 annual financialstatements was RMB10,112,800 and the price for internal control was RMB410,000. The totalexpense on aforesaid two audit work was RMB10,522,800.IX Possibility of Delisting after Disclosure of this Report? Applicable √ Not applicableX Insolvency and Reorganization? Applicable √ Not applicableNo such cases in the Reporting Period.XI Major Legal Matters
? Applicable √ Not applicableNo such cases in the Reporting Period.Other legal matters
Basic situation oflawsuit (arbitration)
| Basic situation of lawsuit (arbitration) | Lawsuit amount (RMB ‘0,000) | Whether form into estimated liabilities | Process of lawsuit (arbitration) | Trial results and influences of lawsuit (arbitration) | Situation of execution of judgment of lawsuit (arbitration) | Disclosure date | Disclosure index |
| Summary of Brazil TCP Case (note) | 94,621.84 | Partly | In progress | Relatively low risk | - | - | - |
| Summary of other matters not meeting the disclosure standards for major lawsuits (arbitrations) | 112,024.47 | Partly | In progress | Relatively low risk | - | - | - |
Note: The major contingent liabilities of TCP and its subsidiaries due to pending litigation with local tax authorities,employees or former employees in Brazil, according to the latest estimates of the Company's management, thepotential compensation amount is RMB946,218,359.48 and is unlikely to result in the outflow of economic benefitsfrom the Company. As a result, the Company does not recognize estimated liabilities for contingent liabilities arisingfrom the aforementioned pending litigation. A counter-compensation agreement in favour of the Company will beexecuted by the original TCP shareholder selling the shares, pursuant to which the original TCP Shareholder isrequired to compensate the Company for the said contingent liability up to a pre-determined amount and for aspecified period.
XII Punishments and Rectifications? Applicable √ Not applicableNo such cases in the Reporting Period.XIII Credit Quality of the Company as well as Its Controlling Shareholder and ActualController? Applicable √ Not applicableXIV Major Related-Party Transactions
1. Continuing Related-Party Transactions
| Related party | Relationship with the Company | Type of transaction | Specific transaction | Pricing principle | Transaction price (RMB’0,000) | Total value (RMB’0,000) | As % of the total value of all the same-type transactions | Approved transaction line (RMB’0,000) | Over the approved line or not | Way of settlement | Obtainable market price for same-type transactions (RMB’0,000) | Disclosure date | Index to disclosed information |
Liaoning PortGroupCo.,Ltd. anditssubsidiaries
| Liaoning Port Group Co., Ltd. and its subsidiaries | Under the control of ultimate shareholder | Render service and lease to related party, receive service and lease from related party | Lease, labor cost, information service income, etc. | Market price | 12,761.45 | 12,761.45 | 18.88% | 24,983.17 | No | Settled monthly | 12,761.45 | 4 April 2023 | www.cninfo.com.cn (Announcement No. 2023-028) |
| Sinotrans Limited and its subsidiaries | Under the control of ultimate shareholder | Render service and lease to related party, receive service from related party | Labor cost, demurrage, lease, etc. | Market price | 14,750.38 | 14,750.38 | 21.82% | 20,239.79 | No | Settled monthly | 14,750.38 | 4 April 2023 | www.cninfo.com.cn (Announcement No. 2023-028) |
| China Nanshan Development (Group) Co., Ltd. and its subsidiaries | Affiliated legal person | Render service and lease to related party, receive service and lease from related party | Labor cost, lease expense of land and houses | Market price | 14,176.34 | 14,176.34 | 20.97% | 14,394.29 | No | Settled monthly | 14,176.34 | 4 April 2023 | www.cninfo.com.cn (Announcement No. 2023-028) |
ChinaMerchantsShekouIndustrial ZoneHoldings Co.,Ltd. anditssubsidiaries
| China Merchants Shekou Industrial Zone Holdings Co., Ltd. and its subsidiaries | Ultimate controlling shareholder control | Render service and lease to related party, receive service and lease from related party | Labor cost, lease expense of land and houses | Market price | 13,007.69 | 13,007.69 | 19.24% | 13,323.90 | No | Settled monthly | 13,007.69 | 4 April 2023 | www.cninfo.com.cn (Announcement No. 2023-028) |
| Other related party | - | Labor cost, lease | Labor cost, lease | Market price | 12,904.51 | 12,904.51 | 19.09% | 28,089.05 | No | Settled monthly | 12,904.51 | 4 April 2023 | www.cninfo.com.cn (Announcement No. 2023-028) |
| Total | -- | -- | 67,600.37 | -- | 101,030.20 | -- | -- | -- | -- | -- | |||
| Large-amount sales return in detail | None | ||||||||||||
| Give the actual situation in the Reporting Period (if any) where an estimate had been made for the total value of continuing related-party transactions by type to occur in the Reporting Period | The Proposal on Recognition of 2022 Daily Related-party Transaction and the Forecast of 2023 Daily Related-party Transaction was reviewed and approved on the 2022 Annual General Meeting on 22 May 2023, which allowed the Company and subsidiaries to conduct daily business transaction including office leasing, providing or receiving labor services. The amount of daily related-party transactions in 2023 is estimated to be RMB1.01 billion. The significant difference between the actual occurrence and the forecast of the Company's daily connected transactions in 2023 is due to the actual market demand and business development needs of the Company. It belongs to the normal operation adjustment of the Company and has not had a great impact on the daily operation and performance of the Company. The transaction price is determined in accordance with market principles, and the pricing is fair, fair and just, without harming the interests of the Company and minority shareholders. | ||||||||||||
| Reason for any significant difference between the transaction price and the market reference price (if applicable) | N/A | ||||||||||||
Note: Other related parties are the current directors, supervisors and senior managers of the company or the directors,supervisors and senior managers of the company who have left the office for less than 12 months as legal personsor other organizations (except the company and the holding company) or the subsidiaries of the company's actualcontroller China Merchants Group Co., LTD. (except the company and the holding company).
2. Related-Party Transactions Regarding Purchase or Sales of Assets or Equity Interests? Applicable √ Not applicable
3. Related Transactions Regarding Joint Investments in Third Parties? Applicable √ Not applicable
4. Credits and Liabilities with Related Parties
Whether there are credits and liabilities with non-operating related parties
√ Yes ? No
Credits receivable with related parties
Relatedparty
| Related party | Related relationship | Forming reason | Whether there is occupation on non-operating capital or not | Beginning balance (RMB’0,000) | Increased in the Reporting Period (RMB’0,000) | Recovered in the Reporting Period (RMB’0,000) | Interest rate | Interest in the Reporting Period (RMB’0,000) | Ending balance (RMB’0,000) |
| China Merchants Bank | The ultimate controlling shareholder has major influence on it | Bank deposits/Structured deposit | No | 428,803.42 | 4,003,363.40 | 4,054,311.48 | 0.20%- 2.75% | 5,124.90 | 377,855.34 |
| Effects of credits with related parties on the Company’s operating results and financial conditions | The above credits receivable with related parties were mainly deposits in financial institutions which has no major influence on the Company’s operating results and financial conditions. | ||||||||
Liabilities payable with related parties:
| Related party | Related relationship | Forming reason | Beginning balance (RMB’0,000) | Increased in the Reporting Period (RMB’0,000) | Recovered in the Reporting Period (RMB’0,000) | Interest rate | Interest in the Reporting Period (RMB’0,000) | Ending balance (RMB’0,000) |
| China Merchants Bank | The ultimate controlling shareholder has major influence on it | Borrowing | 35,137.82 | 121,900.41 | 6,217.52 | 2.48-3.65% | 1,759.66 | 150,820.71 |
| Effects of liabilities with related parties on the Company’s operating results and financial conditions | The above liabilities payable with related parties were mainly financial institution loans which had no major influence on the Company’s operating results and financial conditions. | |||||||
5. Transactions with Related Finance Companies
Deposit business
| Related party | Related relationship | Daily maximum limits (RMB’0,000) | Interest rate range | Beginning balance (RMB’0,000) | Actual amount | Ending balance (RMB’0,000) | |
| Total deposited amount (RMB’0,000) | Total withdrawn amount (RMB’0,000) | ||||||
| China Merchants Group Finance Co., Ltd. | Other company under the same control of controlling shareholder | 500,000.00 | 0.55%-2.1% | 184,169.86 | 2,830,173.07 | 2,805,335.11 | 209,007.82 |
Loan business
Relatedparty
| Related party | Related relationship | Loan limit (RMB’0,000) | Interest rate range | Beginning balance (RMB’0,000) | Total loan amount (RMB’0,000) | Total repaid amount (RMB’0,000) | Ending balance (RMB’0,000) |
| China Merchants Group Finance Co., Ltd. | Other company under the same control of controlling shareholder | 1,000,000.00 | 1.2%-4.06% | 97,983.90 | 78,360.10 | 55,356.69 | 120,987.31 |
Credit or other finance business
| Related party | Related relationship | Type of business | Total amount (RMB’0,000) | Actual amount (RMB’0,000) |
| China Merchants Group Finance Co., Ltd. | Other company under the same control of controlling shareholder | Credit | 1,000,000.00 | 120,987.31 |
6. Transactions with Related Parties by Finance Company Controlled by the Company? Applicable √ Not applicable
7. Other Major Related-Party Transactions
(1) The Company held the 7th Meeting of the 10th Board of Directors on 31 March 2023, andreviewed and approved the Proposal on the Related-Party Transactions Regarding Making Depositsin and Obtaining Loans from China Merchants Bank in 2023, which was submitted to the 2022Annual General Meeting of the Company for deliberation. The Company held the 2022 AnnualGeneral Meeting on 22 May 2023, and deliberated and approved the Proposal on the Related-PartyTransactions Regarding Making Deposits in and Obtaining Loans from China Merchants Bank in2023, agreeing the Company and its subsidiaries to open bank accounts with China Merchants Bank.In 2023, the maximum deposit balance of the Company and its subsidiaries with China MerchantsBank shall not exceed RMB10 billion, and the maximum credit balance shall not exceed RMB15billion. It is agreed that the Company and its subsidiaries shall use temporarily idle own funds topurchase structured deposits and lower risk financial products from China Merchants Bank withinthe amount of the maximum deposit balance. For details, please refer to the Announcement on theRelated-Party Transactions Regarding Making Deposits in and Obtaining Loans from ChinaMerchants Bank in 2023 (Announcement No. 2023-029) disclosed by the Company on 4 April 2023,the Announcement on the Resolution of the 2022 General Meeting of Shareholders (AnnouncementNo. 2023-045) disclosed by the Company on 23 May 2023 and other relevant announcements.
(2) The Company held the 3rd Extraordinary Meeting of the 10th Board of Directors on 6 April 2023,and reviewed and approved the Proposal on the Related-Party Transaction Regarding ConductingFinancial Leasing between Majority-owned Subsidiaries and Related Parties. For details, please referto the Announcement on the Related-Party Transaction Regarding Conducting Financial Leasingbetween Majority-owned Subsidiaries and Related Parties (Announcement No. 2023-034) disclosedby the Company on 7 April 2023.
(3) The Company held the 4th Extraordinary Meeting of the 10th Board of Directors on 28 April 2023,reviewed and approved the Proposal on the Provision of Financial Assistance by Majority-ownedSubsidiaries and Related-Party Transactions to their Equity-participating Companies. For details,please refer to the Announcement on the Provision of Financial Assistance by Majority-ownedSubsidiaries and Related-Party Transactions to their Equity-participating Companies (AnnouncementNo. 2023-040) disclosed by the Company on 29 April 2023 and the Announcement on the Resolutionof the 2022 General Meeting of Shareholders (Announcement No. 2023-045) disclosed by theCompany on 23 May 2023 and other relevant announcements.
(4) The Company held the 2023 First Extraordinary Meeting of the 11th Board of Directors on 14July 2023, at which, the Proposal on the Adjustment of a Partially-owned Subsidiary’s Related-partyGuarantee for Its Equity-participating Company was reviewed and approved. For details, please referto the Announcement on the Adjustment of a Partially-owned Subsidiary’s Related-party Guaranteefor Its Equity-participating Company (Announcement No. 2023-056) disclosed by the Company on15 July 2023, the Announcement on the Resolution of 2023 1st Extraordinary General Meeting ofShareholders disclosed by the Company on 1 August 2023 (Announcement No. 2023-060) and otherrelevant announcements.
(5) The Company held the 2023 4th Extraordinary Meeting of the 11th Board of Directors on 26September 2023, at which, the Proposal on the Transfer and Acquisition of Equity Interests inRelevant Subsidiaries and Related-party Transactions was reviewed and approved. For details, pleaserefer to the Announcement on the Transfer and Acquisition of Equity Interests in RelevantSubsidiaries and Related-party Transactions (Announcement No. 2023-078) disclosed by theCompany on 27 September 2023.Information on the disclosure website for current announcements on significant related-partytransactions:
Name of provisional reports
| Name of provisional reports | Disclosure date | Website |
| Announcement on the Related-Party Transaction Regarding Making Deposits in and Obtaining Loans from China Merchants Bank in 2023 | 4 April 2023 | www.cninfo.com.cn (Announcement No. 2023-029) |
| Announcement on the Related-Party Transaction Regarding Conducting Financial Leasing between Majority-owned Subsidiaries and Related Parties | 7 April 2023 | www.cninfo.com.cn (Announcement No. 2023-034) |
| Announcement on the Provision of Financial Assistance by Majority-owned Subsidiaries and Related-Party Transactions to their Equity-participating Companies | 29 April 2023 | www.cninfo.com.cn (Announcement No. 2023-040) |
| Announcement on the Adjustment of a Partially-owned Subsidiary’s Related-party Guarantee for Its Equity-participating Company | 15 July 2023 | www.cninfo.com.cn (Announcement No. 2023-056) |
| Announcement on the Transfer and Acquisition of Equity Interests in Relevant Subsidiaries and Related-party Transactions | 27 September 2023 | www.cninfo.com.cn (Announcement No. 2023-078) |
XV Major Contracts and Execution thereof
1. Entrustment, Contracting and Leases
(1) Entrustment
□ Applicable √ Not applicable
No such cases in the Reporting Period.
(2) Contracting
□ Applicable √ Not applicable
No such cases in the Reporting Period.
(3) Leases
□ Applicable √ Not applicable
No such cases in the Reporting Period.
2. Major guarantees
(1) Guarantees
Unit: RMB’0,000
Guarantees provided by the Company and its subsidiaries for external parties (exclusive of those for subsidiaries)
| Guarantees provided by the Company and its subsidiaries for external parties (exclusive of those for subsidiaries) | ||||||||||
| Guarantee-receiving entity | Disclosure date of the guarantee line announcement | Line of guarantee | Actual occurrence date | Actual guarantee amount | Type of guarantee | Collateral (if any) | Counter guarantee (if any) | Term of guarantee | Having expired or not | Guarantee for a related party or not |
| Terminal Link S.A.S. | N/A | 7,665.57 | 11 June 2013 | 7,665.57 | General guarantee | Not | Not | About 20 years | Not | Yes |
| Terminal Link S.A.S. | 31 March 2022 | 11,452.73 | 25 January 2023 | 11,452.73 | Joint-liability | Not | Not | About 7 years | Not | Yes |
| Terminal Link SAS | 4 April 2023 | 244,374.40 | ||||||||
| Kingston Freeport Terminal Limited | 31 March 2022 | 5,205.78 | ||||||||
| KHOR AMBADO FZCO* | 30 March 2019 | 20,398.18 | 24 May 2019 | 15,625.48 | Joint-liability | Not | Not | About 13 years | Not | Yes |
| Total approved line for such guarantees in the Reporting Period (A1) | 244,374.40 | Total actual balance of such guarantees in the Reporting Period (A2) | 11,452.73 | |||||||
| Total approved line for such guarantees at the end of the Reporting Period (A3) | 283,890.88 | Total actual balance of such guarantees at the end of the Reporting Period (A4) | 34,743.78 | |||||||
| Guarantee between the Company to its subsidiaries | ||||||||||
Guarantee-receivingentity
| Guarantee-receiving entity | Disclosure date of the guarantee line announcement | Line of guarantee | Actual occurrence date | Actual guarantee amount | Type of guarantee | Collateral (if any) | Counter guarantee (if any) | Term of guarantee | Having expired or not | Guarantee for a related party or not |
| Chiwan Wharf Holdings (Hong Kong) Limited | 31 March 2022 | 190,000.00 | ||||||||
| Port Development (Hongkong) Company Limited | 31 March 2022 | 200,000.00 | ||||||||
| Port Development (Hongkong) Company Limited | 4 April 2023 | 100,000.00 | ||||||||
| Chiwan Wharf Holdings (Hong Kong) Limited | 4 April 2023 | 100,000.00 | ||||||||
| Total approved line for such guarantees in the Reporting Period (B1) | 200,000.00 | Total actual amount of such guarantees in the Reporting Period (B2) | - | |||||||
| Total approved line for such guarantees at the end of the Reporting Period (B3) | 200,000.00 | Total actual balance of such guarantees at the end of the Reporting Period (B4) | - | |||||||
| Guarantees provided between subsidiaries | ||||||||||
| Guarantee-receiving entity | Disclosure date of the guarantee line announcement | Line of guarantee | Actual occurrence date | Actual guarantee amount | Type of guarantee | Collateral (if any) | Counter guarantee (if any) | Term of guarantee | Having expired or not | Guarantee for a related party or not |
| China Merchants International Terminal (Qingdao) Co., LTD | 16 April 2020 | 50,000.00 | 1 January 2021 | 19,931.18 | Joint-liability | Not | Not | January 2024 | Not | Not |
| Shenzhen Jinyu Rongtai Investment development Co., LTD | N/A | 80,000.00 | 12 January 2017 | 44,000.00 | Joint-liability | Not | Not | About 10 years | Not | Not |
ChinaMerchantsInternational(China)Investment Co.,LTD
| China Merchants International (China) Investment Co., LTD | N/A | 2,500.00 | 30 June 2016 | 2,500.00 | Joint-liability | Not | Not | About 10 years | Not | Not |
| China Merchants Finance Company Limited | 3 August 2015 | 354,135.00 | 3 August 2015 | 354,135.00 | General guarantee | Not | Not | About 10 years | Not | Not |
| CMHI Finance (BVI) Co., Ltd | 6 August 2018 | 637,443.00 | 6 August 2018 | 637,443.00 | General guarantee | Not | Not | About 5 years | Yes | Not |
| CMHI Finance (BVI) Co., Ltd | 6 August 2018 | 424,962.00 | 6 August 2018 | 424,962.00 | General guarantee | Not | Not | About 10 years | Not | Not |
| CMHI Finance (BVI) Co., Ltd | 26 September 2020 | 566,616.00 | 9 October 2020 | 424,962.00 | General guarantee | Not | Not | About 3 years | Yes | Not |
| 141,654.00 | General guarantee | Not | Not | About 5 years | Not | Not | ||||
| CMHI Finance (BVI) Co., Ltd | 31 March 2022 | 354,135.00 | 2 June 2022 | 354,135.00 | General guarantee | Not | Not | About 5 years | Not | Not |
| COLOMBO INTERNATIONAL CONTAINER TERMINALS LIMITED | N/A | 18,064.50 | 16 September 2012 | 18,064.50 | General guarantee | Not | Not | About 13 years | Yes | Not |
| COLOMBO INTERNATIONAL CONTAINER TERMINALS LIMITED | N/A | 4,957.89 | - | - | - | - | - | - | - | - |
| COLOMBO INTERNATIONAL CONTAINER TERMINALS LIMITED | N/A | 17,706.75 | 16 September 2012 | 17,706.75 | General guarantee | Not | Not | Infinite | Not | Not |
LomeContainerTerminals Co., Ltd
| Lome Container Terminals Co., Ltd | N/A | 2,750.72 | June 2015 | 247.56 | General guarantee | Not | Not | About 9 years | Yes | Not |
| Lome Container Terminals Co., Ltd | N/A | 2,750.72 | June 2015 | 247.56 | General guarantee | Not | Not | About 9 years | Yes | Not |
| Lome Container Terminals Co., Ltd | N/A | 2,750.72 | June 2015 | 247.56 | General guarantee | Not | Not | About 9 years | Yes | Not |
| TCP - TERMINAL DE CONTElNERES DE PARANAGUA S/A. | N/A | 33,994.43 | 19 April 2018 | 6,798.89 | General guarantee | Not | Not | About 6 years | Not | Not |
| Shenzhen Haixin Port Development Co., LTD | 30 March 2019 | 219,090.00 | 26 June 2019 | 93,275.88 | Joint-liability | Not | Not | About 18 years | Not | Not |
| Zhanjiang Port (Group) Co., LTD | 31 March 2021 | 80,000.00 | 9 October 2021 | 39,840.00 | Joint-liability | Not | Not | About 3 years | Not | Not |
| CMHI Finance (BVI) Co., Ltd | 4 April 2023 | 354,990.00 | ||||||||
| Ansujie Terminal Storage Service (Shenzhen) Co., Ltd. | 4 April 2023 | 70,000.00 | ||||||||
| China Merchants International Terminal (Qingdao) Co., LTD | 31 March 2022 | 10,000.00 | ||||||||
| Shenzhen Haixin Port Development Co., LTD | 4 April 2023 | 105,000.00 | ||||||||
| Total approved line for such guarantees in the Reporting Period (C1) | 529,990.00 | Total actual amount of such guarantees in the Reporting Period (C2) | 0.00 | |||||||
| Total approved line for such guarantees at the end of the Reporting Period (C3) | 2,293,125.07 | Total actual balance of such guarantees at the end of the Reporting Period (C4) | 1,498,938.70 | |||||||
| Total guarantee amount (total of the three kinds of guarantees above) | ||||||||||
Total guarantee line approvedin the Reporting Period(A1+B1+C1)
| Total guarantee line approved in the Reporting Period (A1+B1+C1) | 974,364.40 | Total actual guarantee amount in the Reporting Period (A2+B2+C2) | 11,452.73 |
| Total approved guarantee line at the end of the Reporting Period (A3+B3+C3) | 2,777,015.95 | Total actual guarantee balance at the end of the Reporting Period (A4+B4+C4) | 1,533,682.48 |
| Total actual guarantee amount (A4+B4+C4) as % of the Company’s net assets | 26.06% | ||
| Of which: | |||
| Balance of guarantees provided for shareholders, actual controller and their related parties (D) | 34,743.78 | ||
| Balance of debt guarantees provided directly or indirectly for obligors with an over 70% debt/asset ratio (E) | 1,299,810.37 | ||
| Amount by which the total guarantee amount exceeds 50% of the Company’s net assets (F) | - | ||
| Total of the three amounts above (D+E+F) | 1,334,554.14 | ||
| Joint responsibilities possibly borne in the Reporting Period for undue guarantees (if any) | None | ||
| Provision of external guarantees in breach of the prescribed procedures (if any) | None | ||
Particulars of guarantees adopting complex methods
□ Applicable √ Not applicable
3. Cash Entrusted to Other Entities for Management
(1) Cash Entrusted for Wealth Management
□ Applicable √ Not applicable
No such cases in the Reporting Period.
(2) Entrusted Loans
Overview of entrusted loans in the Reporting Period
Unit: RMB’0,000
| Amount | Capital resources | Undue balance | Overdue amount |
| 3,430.00 | Self-owned funds | 3,430.00 | 0 |
Particulars of entrusted loans with single significant amount or low security, bad liquidity, and nocapital preservation
□ Applicable √ Not applicable
Whether there is the case where the principal cannot be recovered at maturity or other case whichmay cause impairment for entrusted loans
□ Applicable √ Not applicable
4. Other Major Contracts
□ Applicable √ Not applicable
No such cases in the Reporting Period.
XVI Other Significant Events
1. The transfer of 45% equity interest in Ningbo Daxie China Merchants InternationalTerminals Co., Ltd. (Ningbo Daxie) by majority-owned subsidiary CMPort Holdings throughpublic tenderThe Proposal on the Transfer of 45% Equity Interest in Ningbo Daxie China Merchants InternationalTerminals Co., Ltd. by a Majority-owned Subsidiary through Public Tender was approved at theSecond Extraordinary Meeting of the 10th Board of Directors of the Company in 2023 dated 20March 2023. As such, Cyber Chic Company Limited (hereinafter referred to as “Cyber Chic”), awholly-owned subsidiary of the Company’s majority-owned subsidiary CMPort Holdings, wasapproved to transfer its 45% equity interest in Ningbo Daxie through public tender on the ChinaBeijing Equity Exchange, and the Company’s management was authorized to deal with thesubsequent matters relating to the said transaction (including but not limited to the signing of theformal agreement, etc.) at its sole discretion in the transaction process. It was also approved that basedon the results of the asset valuation report issued by Beijing China Enterprise Appraisals Co., Ltd.,the bottom price would be no less than RMB1,845 million (ultimately subject to the results of theasset valuation report filed to the state-owned assets supervision organization). Final transferee andtransaction price would be subject to the results of the public tender. For further information, seeAnnouncement No. 2023-021 on the Transfer of 45% Equity Interest in Ningbo Daxie ChinaMerchants International Terminals Co., Ltd. by a Majority-owned Subsidiary through Public Tender,which has been disclosed by the Company on 22 March 2023.On 20 April 2023, CYBER CHIC put its 45% equity interest in Ningbo Daxie to a public tender onthe China Beijing Equity Exchange. On 19 May 2023, CYBER CHIC received the "Notification ofTransaction Contract Signing" from the China Beijing Equity Exchange, and Ningbo Zhoushan Portbecame the transferee, with a transaction price of RMB1,845 million. On 25 May 2023, CYBERCHIC and Ningbo Zhoushan Port entered into the Equity Transaction Contract. For furtherinformation, see Announcement No. 2023-046 on Progress of the Transfer of 45% Equity Interest inNingbo Daxie China Merchants International Terminals Co., Ltd. by a Majority-owned Subsidiarythrough Public Tender, which has been disclosed by the Company on 26 May 2023.On 8 August 2023, Ningbo Daxie changed its registered information with the competent industrialand commercial administration and received its new business license upon the equity transfer, withits name changed to “Ningbo Daxie Container Terminal Co., Ltd.”. As such, the equity transfer hasbeen completed and CYBER CHIC no longer holds equity interest in Ningbo Daxie. For furtherinformation, see Announcement No. 2023-063 on Progress of the Transfer of 45% Equity Interest inNingbo Daxie China Merchants International Terminals Co., Ltd. by a Majority-owned Subsidiarythrough Public Tender, which has been disclosed by the Company on 10 August 2023.
2. Index to Disclosed Information
The significant events disclosed by the Company on Securities Times, China Securities Journal,Shanghai Securities News, Ta Kung Pao and www.cninfo.com.cn during the Reporting Period are asfollows:
Announcement No.
| Announcement No. | Date of the announcement | Title of the announcement |
| 2023-001 | 10 January 2023 | Announcement on Obtaining the Registration Approval from the China Securities Regulatory Commission for the Public Offering of Corporate Bonds to Professional Investors |
| 2023-002 | 14 January 2023 | Announcement on the Voluntary Information Disclosure of Business Volume Data of December 2022 |
| 2023-003 | 20 January 2023 | Announcement on the Resolutions of the 1st Extraordinary Meeting of the 10th Board of Directors in 2023 |
| 2023-004 | 20 January 2023 | Announcement on the Resolutions of the 1st Extraordinary Meeting of the 10th Board of Supervisors in 2023 |
| 2023-005 | 20 January 2023 | Announcement on Adjusting the Exercise Prices of the Stock Option Incentive Plan (Phase I) of the Company |
| 2023-006 | 20 January 2023 | Announcement on Adjusting the Numbers of Qualified Awardees and Stock Options to Be Granted of the Stock Option Incentive Plan (Phase I) of the Company |
| 2023-007 | 20 January 2023 | Announcement on the Failure to Meet the Exercise Conditions for the Second Exercise Schedule of the Stock Options (the First Batch to be Granted) under the Company’s Stock Option Incentive Plan (Phase I) |
| 2023-008 | 20 January 2023 | Announcement on the Failure to Meet the Exercise Conditions for the First Exercise Schedule of the Stock Options (the Reserved Batch to be Granted) under the Company’s Stock Option Incentive Plan (Phase I) |
| 2023-009 | 20 January 2023 | Announcement on Cancelling Some Stock Options under the Company’s Stock Option Incentive Plan (Phase I) |
| 2023-010 | 8 February 2023 | Announcement on Completing the Cancellation of Some Stock Options under the Company’s Stock Option Incentive Plan (Phase I) |
| 2023-011 | 8 February 2023 | Announcement on the Exercise of the Redemption Option of “22 CMPort 03” Corporate Bond and the Waiver of the Exercise of the Adjustment Option of the Coupon Interest of “22 CMPort 03” Corporate Bond |
| 2023-012 | 10 February 2023 | First Reminder on the Exercise of the Redemption Option of “22 CMPort 03” Corporate Bond and the Waiver of the Exercise of the Adjustment Option of the Coupon Interest of “22 CMPort 03” Corporate Bond |
| 2023-013 | 15 February 2023 | Announcement on the Voluntary Information Disclosure of Business Volume Data of January 2023 |
| 2023-014 | 17 February 2023 | Second Reminder on the Exercise of the Redemption Option of “22 CMPort 03” Corporate Bond and the Waiver of the Exercise of the Adjustment Option of the Coupon Interest of “22 CMPort 03” Corporate Bond |
| 2023-015 | 24 February 2023 | Third Reminder on the Exercise of the Redemption Option of “22 CMPort 03” Corporate Bond and the Waiver of the Exercise of the Adjustment Option of the Coupon Interest of “22 CMPort 03” Corporate Bond |
| 2023-016 | 1 March 2023 | Reminder of the Issuance of 2023 Phase I Super-short-term Financing Bonds |
| 2023-017 | 7 March 2023 | Announcement on the Issue Results of 2023 Phase I Super-short-term Financing Bonds |
| 2023-018 | 8 March 2023 | Announcement on the Redemption Results and Delisting of “22 CMPort 03” |
| 2023-019 | 15 March 2023 | Announcement on the Voluntary Information Disclosure of Business Volume Data of February 2023 |
| 2023-020 | 22 March 2023 | Announcement on the Resolutions of the 2nd Extraordinary Meeting of the 10th Board of Directors in 2023 |
| 2023-021 | 22 March 2023 | Announcement on the Public Transfer of 45% of CMICT’s Equity by the Majority-Owned Subsidiary |
| 2023-022 | 28 March 2023 | Announcement on the Online Investor Meeting on the 2022 Annual Results |
| 2023-023 | 1 April 2023 | Announcement on the Voluntary Information Disclosure of the 2022 Annual Results by the Majority-Owned Subsidiary |
| 2023-024 | 4 April 2023 | Announcement on the Resolutions of the 7th Meeting of the 10th Board of Directors |
2023-025
| 2023-025 | 4 April 2023 | Announcement on the Resolutions of the 7th Meeting of the 10th Board of Supervisors |
| 2023-026 | 4 April 2023 | Announcement on the 2022 Profit Distribution and Dividend Payout Plan |
| 2023-027 | 4 April 2023 | Abstract of 2022 Annual Report (Chinese and English Versions) |
| 2023-028 | 4 April 2023 | Announcement on the Confirmation of the Continuing Related-Party Transactions in 2022 and the Estimation of Such Transactions in 2023 |
| 2023-029 | 4 April 2023 | Announcement on the Related-Party Transaction Regarding Making Deposits in and Obtaining Loans from China Merchants Bank in 2023 |
| 2023-030 | 4 April 2023 | Announcement on the External Guarantee Progress of a Majority-Owned Subsidiary of the Company in 2022 and the Expected New External Guarantee Line in the Next 12 Months |
| 2023-031 | 4 April 2023 | Special Report on Deposit and Usage of Raised Fund in 2022 |
| 2023-032 | 4 April 2023 | Announcement on Reappointment of Accounting Firm in 2023 |
| 2023-033 | 7 April 2023 | Announcement on the Resolutions of the 3rd Extraordinary Meeting of the 10th Board of Directors in 2023 |
| 2023-034 | 7 April 2023 | Announcement on the Related-Party Transaction Regarding Conducting Financial Leasing between Majority-owned Subsidiaries and Related Parties |
| 2023-035 | 8 April 2023 | Announcement on the Resignation of Employee Supervisors |
| 2023-036 | 15 April 2023 | Announcement on the Voluntary Information Disclosure of Business Volume Data of March 2023 |
| 2023-037 | 29 April 2023 | Announcement on the Resolutions of the 4th Extraordinary Meeting of the 10th Board of Directors in 2023 |
| 2023-038 | 29 April 2023 | The First Quarter Report 2023 (Chinese and English Versions) |
| 2023-039 | 29 April 2023 | Announcement on the Extension of Financial Assistance Provided by Majority-owned Subsidiaries |
| 2023-040 | 29 April 2023 | Announcement on the Provision of Financial Assistance by Majority-owned Subsidiaries and Related-Party Transactions to their Equity-participating Companies |
| 2023-041 | 29 April 2023 | Announcement on the Appointment of Mr. Zhu Weida as Deputy General Manager |
| 2023-042 | 29 April 2023 | Notice on Convening 2022 Shareholders’ General Meeting |
| 2023-043 | 29 April 2023 | Announcement on Accounting Policy Changes |
| 2023-044 | 16 May 2023 | Announcement on the Voluntary Information Disclosure of Business Volume Data of April 2023 |
| 2023-045 | 23 May 2023 | Announcement on the Resolutions of 2022 General Meeting of Shareholders |
| 2023-046 | 26 May 2023 | Announcement on the Progress of the Public Transfer of 45% of CMICT’s Equity by the Majority-Owned Subsidiary |
| 2023-047 | 3 June 2023 | Announcement on the Redemption of the 5th Issue of SCP in 2022 upon Maturity |
| 2023-048 | 14 June 2023 | Reminder of the Issuance of 2023 Phase II Super-short-term Financing Bonds |
| 2023-049 | 15 June 2023 | Announcement on the Voluntary Information Disclosure of Business Volume Data of May 2023 |
| 2023-050 | 17 June 2023 | Announcement on the Issue Results of 2023 Phase II Super-short-term Financing Bonds |
| 2023-051 | 20 June 2023 | Announcement on the 2022 Dividend Payout |
| 2023-052 | 6 July 2023 | Announcement on the Public Issuance of Corporate Bonds (Phase I) to Qualified Investors in 2020, Interest Payment, Redemption and Delisting in 2023 |
| 2023-053 | 15 July 2023 | Announcement on the Resolutions of the 1st Extraordinary Meeting of the 11th Board of Directors in 2023 |
| 2023-054 | 15 July 2023 | Announcement on the Resolutions of the 1st Extraordinary Meeting of the 11th Board of Supervisors in 2023 |
| 2023-055 | 15 July 2023 | Announcement on the Appointment of Senior Management and Securities Affairs Representative |
2023-056
| 2023-056 | 15 July 2023 | Announcement on the Adjustment of a Partially-owned Subsidiary’s Related-party Guarantee for Its Equity-participating Company |
| 2023-057 | 15 July 2023 | Announcement on the Resignation and By-election of Director |
| 2023-058 | 15 July 2023 | Notice on Convening the 2023 1st Extraordinary General Meeting of Shareholders |
| 2023-059 | 15 July 2023 | Announcement on the Voluntary Information Disclosure of Business Volume Data of June 2023 |
| 2023-060 | 1 August 2023 | Announcement on the Resolutions of 2023 1st Extraordinary General Meeting of Shareholders |
| 2023-061 | 1 August 2023 | Announcement on the Resolutions of the 2nd Extraordinary Meeting of the 11th Board of Directors in 2023 |
| 2023-062 | 9 August 2023 | Announcement on the Completion of Business Registration Changes |
| 2023-063 | 10 August 2023 | Announcement on the Progress of the Public Transfer of 45% of CMICT’s Equity by the Majority-Owned Subsidiary |
| 2023-064 | 15 August 2023 | Announcement on the Voluntary Information Disclosure of Business Volume Data of July 2023 |
| 2023-065 | 17 August 2023 | Announcement on the Resolutions of the 3rd Extraordinary Meeting of the 11th Board of Directors in 2023 |
| 2023-066 | 17 August 2023 | Announcement on the Appointment of Senior Management |
| 2023-067 | 29 August 2023 | Announcement on the Public Issuance of Corporate Bonds (PhaseI) to Professional Investors in 2022 and Interest Payment for 2023 |
| 2023-068 | 31 August 2023 | Announcement on the Resolutions of the 1st Extraordinary Meeting of the 11th Board of Directors |
| 2023-069 | 31 August 2023 | Announcement on the Resolutions of the 1st Extraordinary Meeting of the 11th Board of Supervisors |
| 2023-070 | 31 August 2023 | Interim Report 2023 (Summary) (Chinese and English Versions) |
| 2023-071 | 31 August 2023 | Special Report on Deposit and Usage of Raised Fund in H1 2023 |
| 2023-072 | 31 August 2023 | Announcement on the Voluntary Information Disclosure of the 2023 Interim Results by the Majority-Owned Subsidiary |
| 2023-073 | 31 August 2023 | Announcement on the Online Investor Meeting on the Results in H1 2023 |
| 2023-074 | 31 August 2023 | Announcement on the Redemption of the 1st Issue of SCP in 2023 upon Maturity |
| 2023-075 | 5 September 2023 | Announcement on the Public Issuance of Corporate Bonds (Phase II ) to Professional Investors in 2022 and Interest Payment for 2023 |
| 2023-076 | 15 September 2023 | Announcement on the Voluntary Information Disclosure of Business Volume Data of August 2023 |
| 2023-077 | 27 September 2023 | Announcement on the Resolutions of the 4th Extraordinary Meeting of the 11th Board of Directors in 2023 |
| 2023-078 | 27 September 2023 | Announcement on the Transfer and Acquisition of Equity Interests in Relevant Subsidiaries and Related-party Transactions |
| 2023-079 | 14 October 2023 | Announcement on the Voluntary Disclosure of the Data on Business Volume for September 2023 |
| 2023-080 | 26 October 2023 | Announcement on the Resolutions of the 5th Extraordinary Meeting of the 11th Board of Directors in 2023 |
| 2023-081 | 26 October 2023 | The Third Quarter Report 2023 (Chinese and English Versions) |
| 2023-082 | 7 November 2023 | Reminder of the Issuance of 2023 Phase III Super-short-term Financing Bonds |
| 2023-083 | 8 November 2023 | Announcement on the Participation in 2023 Shenzhen Online Group Reception Day for Listed Company Investors |
| 2023-084 | 10 November 2023 | Announcement on the Issue Results of 2023 Phase III Super-short-term Financing Bonds |
| 2023-085 | 15 November 2023 | Announcement on Voluntary Information Disclosure of Business Volume Data of October 2023 |
2023-086
| 2023-086 | 18 November 2023 | Notice on Convening 2023 Second Extraordinary General Meeting |
| 2023-087 | 1 December 2023 |
Announcement on the Completion of the Cancellation of the Special Account forFunds Raised by the Company’s Non-public Offering of A-Shares
| 2023-088 | 6 December 2023 | Announcement on Resolutions of 2023 Second Extraordinary General Meeting |
| 2023-089 | 13 December 2023 | Announcement on the Redemption of the 2nd Issue of SCP in 2023 upon Maturity |
| 2023-090 | 15 December 2023 | Announcement on the Voluntary Disclosure of the Data on Business Volume for November 2023 |
| 2023-091 | 29 December 2023 | Announcement on the Resolutions of the 6th Extraordinary Meeting of the 11th Board of Directors in 2023 |
| 2023-092 | 29 December 2023 | Announcement on Approval for Registration of Debt Financing Instruments |
| 2023-093 | 29 December 2023 | Announcement on the Change of the Designated Media for Information Disclosure |
XVII Significant Events of Subsidiaries
□ Applicable √ Not applicable
Part VII Share Changes and Shareholder Information
I Share Changes
1. Share Changes
Unit: share
| Before | Increase/decrease in the Reporting Period (+/-) | After | |||||||
| Shares | Percentage (%) | New issues | Shares as dividend converted from profit | Shares as dividend converted from capital reserves | Other | Subtotal | Shares | Percentage (%) | |
| I. Restricted shares | 576,716,903 | 23.0772% | 0 | 0 | 0 | -7,366 | -7,366 | 576,709,537 | 23.0769% |
| 1. Shares held by state | 0 | 0.0000% | 0 | 0 | 0 | 0 | 0 | 0 | 0.0000% |
| 2. Shares held by state-owned legal person | 576,709,537 | 23.0769% | 0 | 0 | 0 | 0 | 0 | 576,709,537 | 23.0769% |
| 3. Shares held by other domestic investors | 7,366 | 0.0003% | 0 | 0 | 0 | -7,366 | -7,366 | 0 | 0.0000% |
| Including: Shares held by domestic legal person | 0 | 0.0000% | 0 | 0 | 0 | 0 | 0 | 0 | 0.0000% |
| Shares held by domestic natural person | 7,366 | 0.0003% | 0 | 0 | 0 | -7,366 | -7,366 | 0 | 0.0000% |
| 4. Shares held by foreign investors | 0 | 0.0000% | 0 | 0 | 0 | 0 | 0 | 0 | 0.0000% |
| Including: Shares held by foreign legal person | 0 | 0.0000% | 0 | 0 | 0 | 0 | 0 | 0 | 0.0000% |
| Shares held by foreign natural person | 0 | 0.0000% | 0 | 0 | 0 | 0 | 0 | 0 | 0.0000% |
| II. Unrestricted shares | 1,922,357,758 | 76.9228% | 0 | 0 | 0 | 7,366 | 7,366 | 1,922,365,124 | 76.9231% |
| 1. RMB ordinary shares | 1,742,468,718 | 69.7246% | 0 | 0 | 0 | 976 | 976 | 1,742,469,694 | 69.7246% |
| 2. Domestically listed | 179,889,040 | 7.1982% | 0 | 0 | 0 | 6,390 | 6,390 | 179,895,430 | 7.1985% |
foreignshares
| foreign shares | |||||||||
| 3. Overseas listed foreign shares | 0 | 0.0000% | 0 | 0 | 0 | 0 | 0 | 0 | 0.0000% |
| 4. Other | 0 | 0.0000% | 0 | 0 | 0 | 0 | 0 | 0 | 0.0000% |
| III. Total shares | 2,499,074,661 | 100.0000% | 0 | 0 | 0 | 0 | 0 | 2,499,074,661 | 100.0000% |
Reasons for share changes:
The restricted shares held by the Company’s outgoing Senior Management members were changed.Approval of the share changes:
□ Applicable √ Not applicable
Transfer of share ownership:
□ Applicable √ Not applicable
Effects of the share changes on the basic and diluted earnings per share, equity per share attributableto the Company’s ordinary shareholders and other financial indicators of the prior year and the prioraccounting period, respectively:
□ Applicable √ Not applicable
Other information that the Company considers necessary or is required by the securities regulator tobe disclosed:
□ Applicable √ Not applicable
2. Changes in Restricted Shares
Unit: share
| Name of shareholders | Number of restricted shares at the period-begin | Number of increased restricted shares | Number of released restricted shares | Number of restricted shares at the period-end | Reason for restriction | Date of restriction release |
| Zheng Shaoping | 7,366 | 0 | 7,366 | 0 | According to the Articles of Association and the relevant laws and regulations | November 2023 |
| Total | 7,366 | 0 | 7,366 | 0 | -- | -- |
II Issuance and Listing of Securities
□ Applicable √ Not applicable
III Shareholders and Actual Controller
1. Shareholders and Their Shareholdings at the Period-End
Unit: share
Number ofordinaryshareholders atthe period-end
| Number of ordinary shareholders at the period-end | 29,064 (17,986 A-shareholders and 11,078 B-shareholders) | Number of ordinary shareholders at the month-end prior to the disclosure of this Report | 30,312 (19,389 A-shareholders and 10,923 B-shareholders) | Number of preferred shareholders with resumed voting rights at the period-end (if any) | 0 | Number of preferred shareholders with resumed voting rights at the month-end prior to the disclosure of this Report (if any) | 0 | |||||
| 5% or greater shareholders or top 10 shareholders | ||||||||||||
| Name of shareholder | Nature of shareholder | Shareholding percentage | Total shares held at the period-end | Increase/decrease in the Reporting Period | Restricted shares held | Unrestricted shares held | Shares in pledge or frozen | |||||
| CHINA MERCHANTS PORT INVESTMENT DEVELOPMENT COMPANY LIMITED | Foreign legal person | 45.96% | 1,148,648,648 | 0 | 0 | 1,148,648,648 | 0 | |||||
| ZHEJIANG PROVINCIAL SEAPORT INVESTMENT & OPERATION GROUP CO., LTD. | State-owned legal person | 23.08% | 576,709,537 | 0 | 576,709,537 | 0 | 0 | |||||
| CHINA MERCHANTS GANGTONG DEVELOPMENT (SHENZHEN) CO., LTD. | State-owned legal person | 14.84% | 370,878,000 | 0 | 0 | 370,878,000 | 0 | |||||
| SHENZHEN INFRASTRUCTURE INVESTMENT FUND-SHENZHEN INFRASTRUCTURE INVESTMENT FUND PARTNERSHIP (LIMITED PARTNERSHIP) | Fund and wealth management products | 2.59% | 64,850,182 | 0 | 0 | 64,850,182 | 0 | |||||
| BROADFORD GLOBAL LIMITED | State-owned legal person | 2.21% | 55,314,208 | 0 | 0 | 55,314,208 | 0 | |||||
| CHINA-AFRICA DEVELOPMENT FUND | State-owned legal person | 1.69% | 42,190,151 | -21,912,413 | 0 | 42,190,151 | 0 | |||||
CHINA LIFEINSURANCECOMPANYLIMITED-TRADITION-GENERALINSURANCEPRODUCTS-005L- CT001 HU
| CHINA LIFE INSURANCE COMPANY LIMITED-TRADITION- GENERAL INSURANCE PRODUCTS-005L- CT001 HU | Funds, wealth management products, etc. | 0.19% | 4,734,022 | 4,734,022 | 0 | 4,734,022 | 0 | |
| BASIC ENDOWMENT INSURANCE FUND 1006 PORTFOLIO | Funds, wealth management products, etc. | 0.18% | 4,556,289 | 4,556,289 | 0 | 4,556,289 | 0 | |
| HONG KONG SECURITIES CLEARING COMPANY LTD. | Foreign legal person | 0.17% | 4,335,761 | -187,135 | 0 | 4,335,761 | 0 | |
| CHINA MERCHANTS SECURITIES (HK) CO., LTD. | Foreign legal person | 0.11% | 2,668,175 | 125,720 | 0 | 2,668,175 | 0 | |
| Strategic investors or general legal person becoming top-ten ordinary shareholders due to placing of new shares (if any) | Among the foregoing shareholders, Shenzhen Infrastructure Investment Fund-Shenzhen Infrastructure Investment Fund Partnership (Limited Partnership) subscribed for 64,850,182 shares of the Company offered in a non-public manner in 2019 for raising supporting funds at RMB17.16 per share. The subscribed shares were floated on Shenzhen Stock Exchange on 4 November 2019, and the lock-in period lasted until 4 November 2020. China-Africa Development Fund subscribed for 64,102,564 shares of the Company offered in a non-public manner in 2019 for raising supporting funds at RMB17.16 per share. The subscribed shares were floated on Shenzhen Stock Exchange on 4 November 2019, and the lock-in period lasted until 4 November 2020. Zhejiang Provincial Seaport Investment & Operation Group Co., Ltd. subscribed for 576,709,537 shares of the Company offered in a non-public manner at RMB18.50 per share. The subscribed shares were floated on Shenzhen Stock Exchange on 12 October 2022, and the lock-in period lasts until 12 October 2025. | |||||||
| Related or acting-in-concert parties among the shareholders above | Broadford Global Limited is the controlling shareholder of China Merchants Port Investment Development Company Limited and China Merchants Gangtong Development (Shenzhen) Co., Ltd. The Company does not know whether the other unrestricted shareholders are related parties or not. | |||||||
| Above shareholders involved in entrusting/being entrusted and giving up voting rights | None | |||||||
| Special account for share repurchases (if any) among the top 10 shareholders (see note 10) | None | |||||||
| Top 10 unrestricted shareholders | ||||||||
| Name of shareholder | Unrestricted shares held at the period-end | Shares by type | ||||||
| Type | Shares | |||||||
| CHINA MERCHANTS PORT INVESTMENT DEVELOPMENT COMPANY LIMITED | 1,148,648,648 | RMB ordinary share | 1,148,648,648 | |||||
| CHINA MERCHANTS GANGTONG DEVELOPMENT (SHENZHEN) CO., LTD. | 370,878,000 | RMB ordinary share | 370,878,000 | |||||
| SHENZHEN INFRASTRUCTURE INVESTMENT FUND-SHENZHEN INFRASTRUCTURE INVESTMENT FUND PARTNERSHIP (LIMITED PARTNERSHIP) | 64,850,182 | RMB ordinary share | 64,850,182 | |||||
BROADFORD GLOBALLIMITED
| BROADFORD GLOBAL LIMITED | 55,314,208 | Domestically listed foreign share | 55,314,208 |
| CHINA-AFRICA DEVELOPMENT FUND | 42,190,151 | RMB ordinary share | 42,190,151 |
| CHINA LIFE INSURANCE COMPANY LIMITED-TRADITION- GENERAL INSURANCE PRODUCTS-005L- CT001 HU | 4,734,022 | RMB ordinary share | 4,734,022 |
| BASIC ENDOWMENT INSURANCE FUND 1006 PORTFOLIO | 4,556,289 | RMB ordinary share | 4,556,289 |
| HONG KONG SECURITIES CLEARING COMPANY LTD. | 4,335,761 | RMB ordinary share | 4,335,761 |
| CHINA MERCHANTS SECURITIES (HK) CO., LTD. | 2,668,175 | Domestically listed foreign share | 2,668,175 |
| MAI SHUQING | 2,458,747 | RMB ordinary share | 2,458,747 |
| Related or acting-in-concert parties among top 10 unrestricted public shareholders, as well as between top 10 unrestricted public shareholders and top 10 shareholders | Broadford Global Limited is the controlling shareholder of China Merchants Port Investment Development Company Limited and China Merchants Gangtong Development (Shenzhen) Co., Ltd. The Company does not know whether the other unrestricted shareholders are related parties or not. | ||
| Top 10 ordinary shareholders involved in securities margin trading (if any) | At the end of the Reporting Period, the shareholder of the Company, Mai Shuqing held 2,458,747 shares through the customer credit transaction secured securities account in China Merchants Securities Co., Ltd. | ||
Top 10 shareholders involved in refinancing business through lending shares
□ Applicable √ Not applicable
Change in Top 10 shareholders compared with the last period
| Change in Top 10 shareholders compared with last period | |||||
| Name of shareholders (full name) | Add/exit in the Reporting Period | Shares lent for refinancing and not returned yet at the period-end | Shares held by shareholders through their general accounts and credit accounts and Shares lent for refinancing and not returned yet at the period-end | ||
| Total amount | % of total share capital | Total amount | % of total share capital | ||
| CHINA LIFE INSURANCE COMPANY LIMITED-TRADITION- GENERAL INSURANCE PRODUCTS-005L- CT001 HU | Add | 0 | 0.00% | 4,734,022 | 0.19% |
| BASIC ENDOWMENT INSURANCE FUND 1006 PORTFOLIO | Add | 0 | 0.00% | 4,556,289 | 0.18% |
| ZHU HUI | Exit | 0 | 0.00% | 0 | 0.00% |
MONETARYAUTHORITY OFMACAO-SELF-OWNED FUNDS
| MONETARY AUTHORITY OF MACAO-SELF-OWNED FUNDS | Exit | 0 | 0.00% | 0 | 0.00% |
Indicate by tick mark whether any of the top 10 ordinary shareholders or the top 10 unrestrictedordinary shareholders of the Company conducted any promissory repo during the Reporting Period.
□ Yes √ No
No such cases in the Reporting Period.
2. Controlling Shareholder
Nature of the controlling shareholder: Controlled by a central state-owned legal personType of the controlling shareholder: legal person
| Name of controlling shareholder | Legal representative/person in charge | Date of establishment | Unified social credit code | Principal activity |
| BROADFORD GLOBAL LIMITED | Yu Zhiliang, Chen Chengdi, Liang Jian | 27 November 2017 | 68550019-000 | Port services, bonded logistic and cold chain services, property development and investment |
| Shareholdings of the controlling shareholder in other listed companies at home or abroad in this Reporting Period | N/A | |||
Change of the controlling shareholder in the Reporting Period:
□ Applicable √ Not applicable
No such cases in the Reporting Period.
3. Actual Controller and Its Acting-in-Concert Parties
Nature of the actual controller: Central institution for state-owned assets managementType of the actual controller: legal person
| Name of actual controller | Legal representative/person in charge | Date of establishment | Unified social credit code | Principal activity |
| China Merchants Group | Miao Jianmin | 14 October 1986 | 91110000100005220B | Lease and agency of water/land passenger-cargo transportation, water/land conveyance and facilities; investment and management of port and storage business; salvage, refloatation and tugboat; industrial production; construction, repairing, checking and marketing of shipping, offshore petroleum drilling equipment; repairing and checking of drilling platform and drilling container; overall contracting of water/land construction projects and the related offshore petroleum development projects, and their construction organization and logistic services; procurement, supply and sale of water/land communication and |
transportation equipment; export and import business oftransportation; investment and management of finance,insurance, trust, securities, futures business; investment andmanagement of tourism, hotels, catering services and relevantservice; real estate development, management andconsultancy of property; investment and management ofpetroleum and chemical industry; investment and operationof infrastructure of communication; overseas assetsmanagement. Development and management of ShenzhenShekou Industrial Zone and Fujian Zhangzhou DevelopmentZone. (The market body shall independently choose businessitems and carry out business activities according to law. Foritems requiring approval according to law, the market bodymust obtain approval from related authorities before carryingout the business activities. The market body shall not engagein business activities that are banned and restricted in thenational and municipal industrial policies.)
| transportation equipment; export and import business of transportation; investment and management of finance, insurance, trust, securities, futures business; investment and management of tourism, hotels, catering services and relevant service; real estate development, management and consultancy of property; investment and management of petroleum and chemical industry; investment and operation of infrastructure of communication; overseas assets management. Development and management of Shenzhen Shekou Industrial Zone and Fujian Zhangzhou Development Zone. (The market body shall independently choose business items and carry out business activities according to law. For items requiring approval according to law, the market body must obtain approval from related authorities before carrying out the business activities. The market body shall not engage in business activities that are banned and restricted in the national and municipal industrial policies.) | ||
| Shareholdings of the actual controller in other listed companies at home or abroad in this Reporting Period | China Merchants Group holds: 74.35% shares of China Merchants Land Limited; 71.76% share of China Merchants Port Holdings Company Limited; 69.15% shares of Liaoning Port Co., Ltd.; 68.72% shares of China Merchants Expressway Network &Technology Holdings Co., Ltd; 58.48% shares of Sinotrans Limited; 58.47% shares of China Merchants Shekou Industrial Zone Holdings Co., Ltd.; 54.02% shares of China Merchants Energy Shipping Co., Ltd; 51.16% shares of China Merchants Property Operation & Service Co., Ltd.; 44.17% shares of China Merchants Securities Co. Ltd.; 27.97% shares of Nanjing Tanker Corporation; 27.86% shares of China Merchants Bank Co., Ltd; 27.59% shares of China Merchants China Direct Investments Limited. | |
Change of the actual controller during the Reporting Period:
□ Applicable √ Not applicable
No such cases in the Reporting Period.Ownership and control relations between the actual controller and the Company:
Indicate by tick mark whether the actual controller controls the Company via trust or other ways ofasset management.
□ Applicable √ Not applicable
4. Number of Accumulative Pledged Shares held by the Company’s Controlling Shareholderor the Largest Shareholder as well as Its Acting-in-Concert Parties Accounts for 80% of allshares of the Company held by Them
□ Applicable √ Not applicable
5. Other 10% or Greater Corporate Shareholders
Name ofcorporateshareholders
| Name of corporate shareholders | Legal representative/person in charge | Date of establishment | Registered capital | Business scope or management activities |
| China Merchants Port Investment Development Company Limited | Yu Zhiliang, Chen Chengdi, Liang Jian | 15 November 2013 | HKD28,287,989,241 | Investment management of equities and others |
ZhejiangProvincialSeaportInvestment &OperationGroup Co.,Ltd.
| Zhejiang Provincial Seaport Investment & Operation Group Co., Ltd. | Tao Chengbo | 30 July 2014 | RMB50 billion | The exploration and utilization of marine resources, marine industry investment, the management of marine and port resources and capital operations, port investment, construction, and operations, shipping services, commodity reserves, trading, and processing (excluding hazardous chemicals), marine engineering construction, and port engineering design and supervision. (Business activities that require approval in accordance with laws shall be subject to approval by relevant authorities.) |
| China Merchants Gangtong Development (Shenzhen) Co., Ltd. | Qi Yue | 16 January 2018 | RMB13,495,525,700 | Provision of management services for ports (without involving special administrative measures on the access of foreign investment); port information inquiries, economic information consultation, economic information consultation, corporate management consultation, business information consultation, brand management consultation and logistics information consultation (excluding restricted items in each case); technical development and sales of ship machinery and equipment; technical services in respect of port loading and unloading equipment; supporting businesses in respect of the design, sales, import and export of loading and unloading tools, mechanical and electrical products and non-ferrous metal products (excluding precious metals) (Commodities that involve state trading, quota, license and special administrative regulations shall be operated through the application pursuant to related state regulations); technical development and technical services in respect of modern logistics information systems; supply chain management and related supporting services; design of logistics plans; planning of corporate image; planning of cultural exchange activities (without involving special administrative measures on the access of foreign investment); marketing planning; and planning of brand image. (In each case, any item forbidden by laws, administrative regulations and the State Council shall be excluded and restricted items shall be operated upon the attainment of the permission), licensed business item: none |
6. Limitations on Shareholding Decrease by the Company’s Controlling Shareholder, ActualController, Reorganizer and Other Commitment Makers
□ Applicable √ Not applicable
IV Specific Implementation of Share Repurchases in the Reporting Period
Progress on any share repurchases:
□ Applicable √ Not applicable
Progress on reducing the repurchased shares by means of centralized bidding:
□ Applicable √ Not applicable
Part VIII Preference Shares
□ Applicable √ Not applicable
No preference shares in the Reporting Period.
Part IX BondsI Enterprise Bonds
□ Applicable √ Not applicable
No enterprise bonds in the Reporting Period.II Corporate Bonds
1. Basic Information of the Corporate Bonds
Unit: RMB’0,000
Name
| Name | Abbr. | Code | Date of issuance | Value date | Maturity | Bonds balance | Interest rate | Way of redemption | Trading place |
| 2020 Public Offering of Corporate Bonds of China Merchants Port Group Co., Ltd. (for qualified investors) (Phase I) | 20 CMPort 01 | 149170 | 7 July 2020 | 7 July 2020 | 8 July 2023 | 0 | 3.36% | Simple interest is adopted and calculated by year. No compound interest is calculated. Interests are paid once every year and principals paid in lump sum at maturity. In the last instalment, the interests are paid together with principal repayment. | Shenzhen Stock Exchange |
| 2022 Public Offering of Corporate Bonds of China Merchants Port Group Co., Ltd. (for professional investors) (Phase I) | 22 CMPort 01 | 148052 | 29 August 2022 to 30 August 2022 | 30 August 2022 | 30 August 2025 | 300,000.00 | 2.69% | Simple interest is adopted and calculated by year. No compound interest is calculated. Interests are paid once every year and principals paid in lump sum at maturity. In the last instalment, the interests are paid together with principal repayment. | Shenzhen Stock Exchange |
| 2022 Public Offering | 22 CMPort 02 | 148058 | 5 September 2022 to | 6 September 2022 | 6 September 2024 | 300,000.00 | 2.45% | Simple interest is | Shenzhen |
Name
| Name | Abbr. | Code | Date of issuance | Value date | Maturity | Bonds balance | Interest rate | Way of redemption | Trading place |
| of Corporate Bonds of China Merchants Port Group Co., Ltd. (for professional investors) (Phase II) | 6 September 2022 | adopted and calculated by year. No compound interest is calculated. Interests are paid once every year and principals paid in lump sum at maturity. In the last instalment, the interests are paid together with principal repayment. | Stock Exchange | ||||||
| 2022 Public Offering of Corporate Bonds of China Merchants Port Group Co., Ltd. (for professional investors) (Phase III) | 22 CMPort 03 | 148060 | 8 September 2022 to 9 September 2023 | 9 September 2022 | The maturity date of the bonds is 9 September 2023; if the issuer exercises the redemption option, the maturity date of the bonds is 8 March 2023; if the investor exercises the resale option, the maturity date of the resale portion of the bonds is 8 March 2023. | 0 | 1.93% | Simple interest is adopted and calculated by year. No compound interest is calculated. Interests are paid once every year and principals paid in lump sum at maturity. In the last instalment, the interests are paid together with principal repayment. | Shenzhen Stock Exchange |
| Appropriate arrangement of the investors (if any) | The Company's bonds are publicly issued to professional institutional investors | ||||||||
| Applicable trading mechanism | Match-and-deal, negotiate-and-deal, click-and-deal, inquire-and-deal, bid-and-deal | ||||||||
| Risk of termination of listing transactions (if any) and countermeasures | Not | ||||||||
Overdue bonds
□ Applicable √ Not applicable
2. The Trigger and Execution of the Option Clause of the Issuers or Investors and the InvestorProtection Clause
□ Applicable √ Not applicable
3. Intermediary
Bond
| Bond | Intermediary | Office address | Signature accountant | Contact person of intermediary | Contact number |
| 2020 Public Offering of Corporate Bonds of China Merchants Port Group Co., Ltd. (for qualified investors) (Phase I) | Lead Underwriter and Trustee: CITIC Securities Co., Ltd. | 18F CITIC Securities Tower, No.8 Zhongxin 3rd Road, Futian District, Shenzhen | Not applicable | Feng Yuan | 0755-23835062 |
| Law firm: Beijing Junhe Law Firm | 20th Floor, China Resources Building, No. 8 Jianguomen North Street, Dongcheng District, Beijing | Not applicable | Liu Yongzhao, Chen Shanshan | 010-8519 1300 | |
| Credit rating agency: China Chengxin International Credit Rating Co., Ltd. | Room 60101, Building 1, No. 2 Nanzhugan Hutong, Dongcheng District, Beijing | Not applicable | Zhong Ting, Liang Ziqiu | 027-87339288 | |
| Auditor: Deloitte Touche Tohmatsu Certified Public Accountants LLP | 30th Floor, Bund Center, No. 222 East Yan'an Road, Shanghai | Li Weihua, Wang Hongmei | Wang Hongmei | 021-61418888 | |
| 2022 Public Offering of Corporate Bonds of China Merchants Port Group Co., Ltd. (for professional investors) (Phase I) | Lead Underwriter and Trustee: CITIC Securities Co., Ltd. | 18F CITIC Securities Tower, No.8 Zhongxin 3rd Road, Futian District, Shenzhen | Not applicable | Feng Yuan | 0755-23835062 |
| Law firm: Beijing Junhe Law Firm | 20th Floor, China Resources Building, No. 8 Jianguomen North Street, Dongcheng District, Beijing | Not applicable | Liu Yongzhao, Chen Shanshan | 010-8519 1300 | |
| Credit rating agency: China Chengxin International Credit Rating Co., Ltd. | Room 60101, Building 1, No. 2 Nanzhugan Hutong, Dongcheng District, Beijing | Not applicable | Zhong Ting, Liang Ziqiu | 027-87339288 | |
| Auditor: Deloitte Touche | 30th Floor, Bund Center, | Li Weihua, Wang Hongmei | Wang Hongmei | 021-61418888 |
Bond
| Bond | Intermediary | Office address | Signature accountant | Contact person of intermediary | Contact number |
| Tohmatsu Certified Public Accountants LLP | No. 222 East Yan’an Road, Shanghai | ||||
| 2022 Public Offering of Corporate Bonds of China Merchants Port Group Co., Ltd. (for professional investors) (Phase II) | Lead Underwriter and Trustee: CITIC Securities Co., Ltd. | 18F CITIC Securities Tower, No.8 Zhongxin 3rd Road, Futian District, Shenzhen | Not applicable | Feng Yuan | 0755-23835062 |
| Law firm: Beijing Junhe Law Firm | 20th Floor, China Resources Building, No. 8 Jianguomen North Street, Dongcheng District, Beijing | Not applicable | Liu Yongzhao, Chen Shanshan | 010-8519 1300 | |
| Credit rating agency: China Chengxin International Credit Rating Co., Ltd. | Room 60101, Building 1, No. 2 Nanzhugan Hutong, Dongcheng District, Beijing | Not applicable | Zhong Ting, Liang Ziqiu | 027-87339288 | |
| Auditor: Deloitte Touche Tohmatsu Certified Public Accountants LLP | 30th Floor, Bund Center, No. 222 East Yan’an Road, Shanghai | Li Weihua, Wang Hongmei | Wang Hongmei | 021-61418888 | |
| 2022 Public Offering of Corporate Bonds of China Merchants Port Group Co., Ltd. (for professional investors) (Phase III) | Lead Underwriter and Trustee: CITIC Securities Co., Ltd. | 18F CITIC Securities Tower, No.8 Zhongxin 3rd Road, Futian District, Shenzhen | Not applicable | Feng Yuan | 0755-23835062 |
| Law firm: Beijing Junhe Law Firm | 20th Floor, China Resources Building, No. 8 Jianguomen North Street, Dongcheng District, Beijing | Not applicable | Liu Yongzhao, Chen Shanshan | 010-8519 1300 | |
| Credit rating agency: China Chengxin International Credit Rating Co., Ltd. | Room 60101, Building 1, No. 2 Nanzhugan Hutong, Dongcheng District, Beijing | Not applicable | Zhong Ting, Liang Ziqiu | 027-87339288 | |
| Auditor: Deloitte Touche Tohmatsu | 30th Floor, Bund Center, No. 222 East | Li Weihua, Wang Hongmei | Wang Hongmei | 021-61418888 |
Bond
| Bond | Intermediary | Office address | Signature accountant | Contact person of intermediary | Contact number |
| Certified Public Accountants LLP | Yan’an Road, Shanghai |
Indicate by tick mark whether above intermediary changed in the Reporting Period
□ Yes √ No
4. List of the Usage of the Raised Funds
Unit: RMB’0,000
| Bonds | Total amount | Amount spent | Unused amount | Operation of special account for raised funds (if any) | Rectification of raised funds for violation operation (if any) | Whether is consistent with the usage, using plan and other agreements stipulated in the raising specification |
| 2020 Public Offering of Corporate Bonds of China Merchants Port Group Co., Ltd. (for qualified investors) (Phase I) | 200,000.00 | 200,000.00 | 0.00 | None | None | Yes |
| 2022 Public Offering of Corporate Bonds of China Merchants Port Group Co., Ltd. (for professional investors) (Phase I) | 300,000.00 | 300,000.00 | 0.00 | None | None | Yes |
| 2022 Public Offering of Corporate Bonds of China Merchants Port Group Co., Ltd. (for professional investors) (Phase II) | 300,000.00 | 300,000.00 | 0.00 | None | None | Yes |
Bonds
| Bonds | Total amount | Amount spent | Unused amount | Operation of special account for raised funds (if any) | Rectification of raised funds for violation operation (if any) | Whether is consistent with the usage, using plan and other agreements stipulated in the raising specification |
| 2022 Public Offering of Corporate Bonds of China Merchants Port Group Co., Ltd. (for professional investors) (Phase III) | 200,000.00 | 200,000.00 | 0.00 | None | None | Yes |
The raised funds were used for project construction
□ Applicable √ Not applicable
The Company changed the usage of above funds raised from bonds during the Reporting Period.
□ Applicable √ Not applicable
5. Adjustment of Credit Rating Results during the Reporting Period
□ Applicable √ Not applicable
6. Execution and Changes of Guarantee, Repayment Plan and Other Repayment GuaranteeMeasures as well as Influence on Equity of Bond Investors during the Reporting Period
□ Applicable √ Not applicable
III Debt Financing Instruments of Non-financial Enterprises
1. Basic Information of Debt Financing Instruments of a Non-financial Enterprise
Unit: RMB’0,000
| Name | Abbr. | Code | Date of issuance | Value date | Maturity | Bonds balance | Interest rate | Way of redemption | Trading place |
| Medium-term Notes of China | 21 CMPort MTN001 | 102100703 | 14 April 2021 | 16 April 2021 | 16 April 2024 | 200,000.00 | 3.52% | Interests paid | Interbank |
MerchantsPortGroupCo., Ltd.(Phase I2021)
| Merchants Port Group Co., Ltd. (Phase I 2021) | once every year and principals paid in lump sum on the redemption date | bond market | |||||||
| Super-short-term Commercial Papers of China Merchants Port Group Co., Ltd. (Phase V 2022) | 22 CMPort SCP005 | 012283152 | 1 September 2022 | 5 September 2022 | 2 June 2023 | 0 | 1.75% | Principals and interest paid in lump sum at maturity | Interbank bond market |
| Super-short-term Commercial Papers of China Merchants Port Group Co., Ltd. (Phase I 2023) | 23 CMPort SCP001 | 012380785 | 1 March 2023 | 3 March 2023 | 30 August 2023 | 0 | 2.35% | Principals and interest paid in lump sum at maturity | Interbank bond market |
| Super-short-term Commercial Papers of China Merchants Port Group Co., Ltd. (Phase II 2023) | 23 CMPort SCP002 | 012382233 | 14 June 2023 | 15 June 2023 | 12 December 2023 | 0 | 2.05% | Principals and interest paid in lump sum at maturity | Interbank bond market |
| Super-short-term Commercial Papers of China Merchants Port Group Co., Ltd. (Phase III 2023) | 23 CMPort SCP003 | 012384044 | 7 November 2023 | 8 November 2023 | 6 February 2024 | 200,000.00 | 2.43% | Principals and interest paid in lump sum at maturity | Interbank bond market |
| Appropriate arrangeme | Not applicable | ||||||||
nt of theinvestors(if any)
| nt of the investors (if any) | |
| Applicable trading mechanism | Inquiry |
| Risk of termination of listing transactions (if any) and countermeasures | None |
Matured bonds unredeemed
□ Applicable √ Not applicable
2. Triggering and Implementation of Issuer or Investor Option Clauses and Investor ProtectionClauses
□ Applicable √ Not applicable
3. Intermediary
| Bond | Intermediary | Office address | Signature accountant | Contact person of intermediary | Contact number |
| Medium-term Notes of China Merchants Port Group Co., Ltd. (Phase I 2021) | Lead Underwriter: China Merchants Bank Co., Ltd. | China Merchants Bank Shenzhen Branch Building, No. 2016 Shennan Avenue, Shenzhen, Guangdong Province | Uninvolved | Luo Yingying, Gan Yawen | 0755-88023712 |
| Co-lead Underwriter: CITIC Securities Co., Ltd. | 18th Floor, CITIC Securities Building, No. 8 Zhongxin 3rd Road, Futian District, Shenzhen | Feng Yuan | 0755-23835062 | ||
| Law firm: Beijing Junhe Law Firm | 20th Floor, China Resources Building, No. 8 Jianguomen North Street, Dongcheng District, Beijing | Liu Yongzhao, Chen Shanshan | 010-8519 1300 | ||
| Credit rating agency: China Chengxin International | Room 60101, Building 1, No. 2 Nanzhugan Hutong, | Zhong Ting, Liang Ziqiu | 027-87339288 |
Bond
| Bond | Intermediary | Office address | Signature accountant | Contact person of intermediary | Contact number |
| Credit Rating Co., Ltd. | Dongcheng District, Beijing | ||||
| Super-short-term Commercial Papers of China Merchants Port Group Co., Ltd. (Phase V 2022) | Lead Underwriter: Agricultural Bank of China Co., Ltd. | No. 69, Jianguomen Inner Street, Dongcheng District, Beijing | Uninvolved | An Liwei | 010-85109045 |
| Co-lead Underwriter: Bank of China Limited | No. 1 Fuxingmen Inner Street, Xicheng District, Beijing, China | Li Xintong | 010-66595024 | ||
| Law firm: Beijing Junhe Law Firm | 20th Floor, China Resources Building, No. 8 Jianguomen North Street, Dongcheng District, Beijing | Liu Yongzhao, Chen Shanshan | 010-8519 1300 | ||
| Credit rating agency: China Chengxin International Credit Rating Co., Ltd. | Room 60101, Building 1, No. 2 Nanzhugan Hutong, Dongcheng District, Beijing | Zhong Ting, Liang Ziqiu | 027-87339288 | ||
| Super-short-term Commercial Papers of China Merchants Port Group Co., Ltd. (Phase I 2023) | Lead Underwriter: China Merchants Bank Co., Ltd. | China Merchants Bank Shenzhen Branch Building, No. 2016 Shennan Avenue, Shenzhen | Uninvolved | Luo Yingying, Gan Yawen | 0755-88023712 |
| Co-lead Underwriter: Industrial and Commercial Bank of China | No. 55 Fuxingmen Inner Street, Xicheng District, Beijing, China | Liu Hanbin | 010-81012319 | ||
| Law firm: Beijing Junhe Law Firm | 20th Floor, China Resources Building, No. 8 Jianguomen North Street, Dongcheng District, Beijing | Liu Yongzhao, Chen Shanshan | 010-8519 1300 | ||
| Credit rating agency: China Chengxin International Credit Rating Co., Ltd. | Room 60101, Building 1, No. 2 Nanzhugan Hutong, Dongcheng District, Beijing | Zhong Ting, Liang Ziqiu | 027-87339288 |
Bond
| Bond | Intermediary | Office address | Signature accountant | Contact person of intermediary | Contact number |
| Super-short-term Commercial Papers of China Merchants Port Group Co., Ltd. (Phase II 2023) | Lead Underwriter: China Merchants Bank Co., Ltd. | China Merchants Bank Shenzhen Branch Building, No. 2016 Shennan Avenue, Shenzhen | Uninvolved | Luo Yingying, Gan Yawen | 0755-88023712 |
| Co-lead Underwriter: Industrial Bank Co. Ltd. | 15th Floor, Industrial Bank Building, No. 20 Chaoyangmen North Street, Chaoyang District, Beijing | Zhang Hao, Wu Dan | 010-89926629、0755-82049629 | ||
| Law firm: Beijing Junhe Law Firm | 20th Floor, China Resources Building, No. 8 Jianguomen North Street, Dongcheng District, Beijing | Liu Yongzhao, Chen Shanshan | 010-8519 1300 | ||
| Credit rating agency: China Chengxin International Credit Rating Co., Ltd. | Room 60101, Building 1, No. 2 Nanzhugan Hutong, Dongcheng District, Beijing | Zhong Ting, Liang Ziqiu | 027-87339288 | ||
| Super-short-term Commercial Papers of China Merchants Port Group Co., Ltd. (Phase III 2023) | Lead Underwriter: China Merchants Bank Co., Ltd. | China Merchants Bank Shenzhen Branch Building, No. 2016 Shennan Avenue, Shenzhen | Uninvolved | Luo Yingying, Gan Yawen | 0755-88023712 |
| Co-lead Underwriter: Industrial and Commercial Bank of China | No. 55 Fuxingmen Inner Street, Xicheng District, Beijing, China | Liu Hanbin | 010-81012319 | ||
| Law firm: Beijing Junhe Law Firm | 20th Floor, China Resources Building, No. 8 Jianguomen North Street, Dongcheng District, Beijing | Liu Yongzhao, Chen Shanshan | 010-8519 1300 | ||
| Credit rating agency: China | Room 60101, Building 1, No. | Zhong Ting, Liang Ziqiu | 027-87339288 |
Bond
| Bond | Intermediary | Office address | Signature accountant | Contact person of intermediary | Contact number |
| Chengxin International Credit Rating Co., Ltd. | 2 Nanzhugan Hutong, Dongcheng District, Beijing |
Indicate by tick mark whether above intermediary changed in the Reporting Period
□ Yes √ No
4. List of the Usage of the Raised Funds
Unit: RMB’0,000
| Bonds | Total amount | Amount spent | Unused amount | Operation of special account for raised funds (if any) | Rectification of raised funds for violation operation (if any) | Whether is consistent with the usage, using plan and other agreements stipulated in the raising specification |
| Medium-term Notes of China Merchants Port Group Co., Ltd. (Phase I 2021) | 200,000.00 | 200,000.00 | 0.00 | None | None | Yes |
| Super-short-term Commercial Papers of China Merchants Port Group Co., Ltd. (Phase V 2022) | 100,000.00 | 100,000.00 | 0.00 | None | None | Yes |
| Super-short-term Commercial Papers of China Merchants Port Group Co., Ltd. (Phase I 2023) | 200,000.00 | 200,000.00 | 0.00 | None | None | Yes |
| Super-short-term Commercial Papers of | 200,000.00 | 200,000.00 | 0.00 | None | None | Yes |
ChinaMerchantsPort GroupCo., Ltd.(Phase II2023)
| China Merchants Port Group Co., Ltd. (Phase II 2023) | ||||||
| Super-short-term Commercial Papers of China Merchants Port Group Co., Ltd. (Phase III 2023) | 200,000.00 | 200,000.00 | 0.00 | None | None | Yes |
The raised funds were used for project construction
□ Applicable √ Not applicable
The Company changed the usage of above funds raised from bonds during the Reporting Period.
□ Applicable √ Not applicable
5. Adjustment of Credit Rating Results during the Reporting Period
□ Applicable √ Not applicable
6. Execution and Changes of Guarantee, Repayment Plan and Other Repayment GuaranteeMeasures as well as Influence on Equity of Bond Investors during the Reporting Period
□ Applicable √ Not applicable
IV Convertible Corporate Bonds
□ Applicable √ Not applicable
No such cases in the Reporting Period.V Losses of Scope of Consolidated Financial Statements during the Reporting Period Exceeding10% of Net Assets up the Period-end of Last Year
□ Applicable √ Not applicable
VI Matured Interest-bearing Debt excluding Bonds up the Period-end
□ Applicable √ Not applicable
VII Whether there was any Violation of Rules and Regulations during the Reporting Period
□ Yes √ No
VIII The Major Accounting Data and the Financial Indicators of the Recent 2 Years of theCompany up the Period-end
Item
| Item | 31 December 2023 | 31 December 2022 (Restated) | Change |
| Current ratio | 80.71% | 76.93% | 4.91% |
| Debt/asset ratio | 36.76% | 35.06% | 1.70% |
| Quick ratio | 79.96% | 76.08% | 5.10% |
| 2023 | 2022(Restated) | Change | |
| Net profit before exceptional gains and losses (RMB ’0,000) | 333,922.68 | 336,501.79 | -0.77% |
| EBITDA/debt ratio | 19.65% | 21.47% | -1.82% |
| Interest cover (times) | 3.85 | 4.14 | -7.00% |
| Cash-to-interest cover (times) | 4.38 | 5.02 | -12.75% |
| EBITDA-to-interest cover (times) | 6.28 | 6.59 | -4.70% |
| Debt repayment ratio (%) | 100.00% | 100.00% | - |
| Interest payment ratio (%) | 100.00% | 100.00% | - |
Part X Financial Statements
I Independent Auditor’s Report
| Type of the independent auditor’s opinion | Standard and unqualified auditor's report |
| Date of signing this report | 29 March 2024 |
| Name of the independent auditor | Deloitte Touche Tohmatsu Certified Public Accountants LLP |
| Reference number of Audit Report | De Shi Bao (Shen) Zi (24) No. [P03112] |
| Name of the certified public accountants | Li Weihua, Wang Hongmei |
II Financial StatementsSee attached.
China Merchants Port Group Co., Ltd.
Board of Directors2 April 2024
CHINA MERCHANTS PORT GROUP CO., LTD.
FINANCIAL STATEMENTS AND AUDITOR'S REPORTFOR THE YEAR ENDED 31 DECEMBER 2023
FINANCIAL STATEMENTS AND AUDITOR'S REPORTFOR THE YEAR ENDED 31 DECEMBER 2023
CONTENTS PAGE(S)
AUDITOR'S REPORT 1 - 6
CONSOLIDATED BALANCE SHEET 7 - 8
BALANCE SHEET OF THE COMPANY 9 - 10
CONSOLIDATED INCOME STATEMENT 11
INCOME STATEMENT OF THE COMPANY 12
CONSOLIDATED CASH FLOW STATEMENT 13
CASH FLOW STATEMENT OF THE COMPANY 14
CONSOLIDATED STATEMENT OF CHANGES INSHAREHOLDERS' EQUITY 15 - 16
THE COMPANY'S STATEMENT OF CHANGES INSHAREHOLDERS' EQUITY 17 - 18
NOTES TO THE FINANCIAL STATEMENTS 19 - 189
- 1 -
AUDITOR'S REPORT
De Shi Bao (Shen) Zi (24) No. P03112
(Page 1 of 6)
To all the shareholders of China Merchants Port Group Co., Ltd.,
I. Audit Opinion
We have audited the financial statements of China Merchants Port Group Co., Ltd. (hereinafter referredto as "the Company"), which comprise the consolidated and Company's balance sheets as at 31December 2023, and the consolidated and Company's income statements, the consolidated andCompany's cash flow statements and the consolidated and Company's statements of changes inshareholders' equity for the year then ended, and the notes to the financial statements.
In our opinion, the accompanying financial statements of the Company are prepared and present fairly,in all material respects, the consolidated and Company's financial position as at 31 December 2023, andthe consolidated and Company's results of operations and cash flows for the year then ended inaccordance with the Accounting Standards for Business Enterprises.
II. Basis for the Opinion
We conducted our audit in accordance with China Standards on Auditing. Our responsibilities underthose standards are further described in the Auditor's Responsibilities for the Audit of the FinancialStatements section of our report. We are independent of the Company in accordance with China Codeof Ethics for Certified Public Accountants, and we have fulfilled our other ethical responsibilities inaccordance with the Code. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our opinion.
III. Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in ouraudit of the financial statements of the current year. These matters were addressed in the context of ouraudit of the financial statements as a whole, and in forming our opinion thereon, we do not provide aseparate opinion on these matters. We determine the followings are key audit matters that need to beaddressed in our report.
1. Subsequent measurement of long-term equity investments in associates
As disclosed in Note (VIII) 12 to the consolidated financial statements, as at 31 December 2023, thecarrying amount of the Company's long-term equity investments in associates amounts to RMB87,708,124,441.05, accounting for 69.85% of the total shareholder's equity. In 2023, the investmentincome from associates recognized under the equity method amounts to RMB 5,582,402,904.90,accounting for 74.48% of the consolidated net profit. Since the amount of income from investments inassociates recognized by the Company for the year is significant, and its correctness depends on thefinancial status and operating results of the investee, we determine the above-mentioned subsequentmeasurement of the long-term equity investments in associates as a key audit matter of the consolidatedfinancial statements.
- 2 -
AUDITOR'S REPORT - continued
De Shi Bao (Shen) Zi (24) No. P03112
(Page 2 of 6)
III. Key Audit Matters - continued
1. Subsequent measurement of long-term equity investments in associates - continued
Principal audit procedures we performed for the above key audit matter are as follows:
(1) Understood the certified public accountants of major associates and evaluated their independence
and professional competence;
(2) Identified and assessed the risk of material misstatement in the financial statements of the major
associates from the perspective of auditing the consolidated financial statements of the Companyby reading the financial statements of the major associates and discussing with the managementabout the financial performance of the major associates and the significant judgments andestimates made in the preparation of the financial statements;
(3) Discussed with the component certified public accountants of the major associates about their
assessment of the component audit risk, the identification of key audit areas and theimplementation of the corresponding audit procedures to evaluate whether the audit of thecomponent certified public accountants was appropriate;
(4) Verified whether the accounting policies and accounting periods adopted by the major associates
were consistent with those of the Company. If not, checked whether the financial statements ofthe major associates have been adjusted according to the accounting policies and accountingperiods of the Company, and recognized the amount of investment income under equity methodon that basis.
2. Goodwill impairment
As disclosed in Note (VIII) 20 to the consolidated financial statements, as at 31 December 2023, thegoodwill presented in the consolidated financial statements of the Company is RMB 6,493,002,246.44.The management of the Company uses the net amount of fair value less costs of disposal or the presentvalue of the estimated future cash flows to determine the recoverable amount of the relevant asset groupwhen testing the goodwill for impairment, of which the fair value assessment is based on the marketapproach, and the forecast of future cash flows and the calculation of the present value include keyassumptions, such as growth rate and discount rate. We determine goodwill impairment as a key auditmatter of the consolidated financial statements due to the significant amount of goodwill and that themanagement needs to make significant judgments and estimates when conducting goodwill impairmenttesting.
- 3 -
AUDITOR'S REPORT - continued
De Shi Bao (Shen) Zi (24) No. P03112
(Page 3 of 6)
III. Key Audit Matters - continued
2. Goodwill impairment - continued
Principal audit procedures we performed for the above key audit matter are as follows:
(1) Assessed the reasonableness of the division of asset group and combination of asset group made
by the management;
(2) Referred to the industry practice to assess whether the management's approach in cash flow
forecast was appropriate and whether the assumptions used were reasonable;
(3) Compared the data used in cash flow forecast with historical data and budget data approved by
the management, and assessed the reasonableness of the data used;
(4) Compared the growth rate of the business volume in the forecast period with the growth rate of
the historical business volume and evaluated its reasonableness;
(5) Understood the basis adopted by the management to determine the growth rate of the business in
the subsequent forecast period and assessed its reasonableness;
(6) Assessed the reasonableness of the discount rate adopted by the management in combination with
market risk-free interest rates, risk factors, etc.;
(7) Used the work of internal evaluation experts to evaluate the appropriateness of the management's
method to assess the recoverable amount of the asset group, and evaluate the reasonableness ofthe discount rate used by the management in predicting the present value of cash flows and thegrowth rate of the subsequent forecast period;
(8) Reviewed whether the calculation of the present value of future cash flows was correct;
(9) Assessed whether the method used to determine the fair value less costs of disposal was
appropriate;
(10) Assessed the adequacy and appropriateness of the disclosure of goodwill impairment testing.
IV. Other Information
The management of the Company is responsible for the other information. The other informationcomprises the information included in the 2023 annual report, but does not include the consolidatedfinancial statements and our auditor's report.
Our opinion on the financial statements does not cover the other information and we do not express anyform of assurance conclusion.
- 4 -
AUDITOR'S REPORT - continued
De Shi Bao (Shen) Zi (24) No. P03112
(Page 4 of 6)
IV. Other Information - continued
In combination with our audit of the financial statements, our responsibility is to read the otherinformation and, in doing so, consider whether the other information is materially inconsistent with thefinancial statements or our knowledge obtained in the audit or otherwise appears to be materiallymisstated.
If, based on the audit work performed, we conclude that there is a material misstatement of this otherinformation, we are required to report that fact. We have nothing to report in this regard.
V. Responsibilities of the Management and Those Charged with Governance for the Financial
Statements
The management of the Company is responsible for the preparation of the financial statements that givea true and fair view in accordance with Accounting Standards for Business Enterprises, and for thedesign, performance and maintenance of such internal control that is necessary to enable that thepreparation of financial statements are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the management is responsible for assessing the Company's abilityto continue as a going concern, disclosing, as applicable, matters related to going concern and using thegoing concern basis of accounting unless the management either intends to liquidate the Company or tocease operations, or has no realistic alternative but to do so.
These charged with governance are responsible for overseeing the Company's financial reportingprocess.
VI. Auditor's Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements are free frommaterial misstatement, whether due to fraud or error, and to issue an auditor's report that includes anaudit opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an auditconducted in accordance with China Standards on Auditing will always detect a material misstatementwhen it exists. Misstatements can arise from fraud or error and are considered material if, individuallyor in the aggregate, they could reasonably be expected to influence the economic decisions of users takenon the basis of these financial statements.
- 5 -
AUDITOR'S REPORT - continued
De Shi Bao (Shen) Zi (24) No. P03112
(Page 5 of 6)
VI. Auditor's Responsibilities for the Audit of the Financial Statements - continued
As part of an audit in accordance with China Standards on Auditing, we exercise professional judgmentand maintain professional skepticism throughout the audit. We also:
(1) Identified and assessed the risks of material misstatement of the financial statements, whether due
to fraud or error, designed and performed audit procedures responsive to those risks, and obtainedaudit evidence that was sufficient and appropriate to form our opinion. The risk of not detectinga material misstatement resulting from fraud was higher than for one resulting from error, as fraudmay involve collusion, forgery, intentional omissions, misrepresentations, or the override ofinternal control.
(2) Understood audit-related internal control in order to design audit procedures that were appropriate
in the circumstances.
(3) Evaluated the appropriateness of accounting policies applied and the reasonableness of
accounting estimates and related disclosures made by the management.
(4) Concluded on the appropriateness of the management' application of the going concern basis of
accounting. Based on audit evidence obtained, concluded on whether the material uncertainty ofevents or conditions that may cast significant doubt on the Company's ability to continue as agoing concern existed. If we concluded that a material uncertainty existed, we were required todraw attention in our auditor's report to the related disclosures in the financial statements or tomodify our opinion, if such disclosures were inadequate. Our conclusions were based on the auditevidence obtained up to the date of our auditor's report. However, future events or conditions maycause the Company to cease to continue as a going concern.
(5) Evaluated the overall presentation (including the disclosures), structure and content of the
financial statements, and whether the financial statements represented the underlying transactionsand events in a manner that achieved fair presentation.
(6) Obtained sufficient appropriate audit evidence regarding the financial information of the entities
or business activities within the Company to express an opinion on the financial statements. Wewere responsible for the direction, supervision and performance of the group audit. We remainedsolely responsible for our audit opinion.
We communicated with those charged with governance regarding, among other matters, the plannedscope and timing of the audit and significant audit findings, including any significant deficiencies ininternal control that we identified during our audit.
We also provided those charged with governance with a statement that we had complied with relevantethical requirements of independence, and communicated with those charged with governance over allrelationships and other matters that may reasonably be thought to bear on our independence, and whereapplicable, related safeguards.
- 6 -
AUDITOR'S REPORT - continued
De Shi Bao (Shen) Zi (24) No. P03112
(Page 6 of 6)
VI. Auditor's Responsibilities for the Audit of the Financial Statements - continued
From the matters communicated with those charged with governance, we determined those matters thatwere of most significance in the audit of the financial statements of the current year and were thereforethe key audit matters. We described these matters in our auditor's report unless law or regulationprecluded public disclosure about the matter or when, in extremely rare circumstances, we determinedthat a matter should not be addressed in our report because the adverse consequences of doing so wouldreasonably be expected to outweigh the public interest benefits of such communication.
Deloitte Touche Tohmatsu CPA LLP Chinese Certified Public Accountant(Engagement Partner)Shanghai, China
Li Weihua
Chinese Certified Public Accountant
Wang Hongmei
29 March 2024
The auditor's report and the accompanying financial statements are English translations of the Chinese auditor's report andstatutory financial statements prepared under accounting principles and practices generally accepted in the People'sRepublic of China. These financial statements are not intended to present the financial position and results of operationsand cash flows in accordance with accounting principles and practices generally accepted in other countries andjurisdictions. In case the English version does not conform to the Chinese version, the Chinese version prevails.
- 7 -
AT 31 DECEMBER 2023
Consolidated Balance Sheet
RMB
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Notes | 31/12/2023 | 31/12/2022 (Restated) |
| Current Assets: | |||
| Cash and bank balances | (VIII)1 | 16,079,646,178.24 | 13,615,928,739.40 |
| Held-for-trading financial assets | (VIII)2 | 4,568,806,108.84 | 2,998,781,599.63 |
| Notes receivable | (VIII)3 | 325,150,195.09 | 36,395,000.00 |
| Accounts receivable | (VIII)4 | 1,103,901,466.25 | 1,276,149,689.44 |
| Receivables financing | (VIII)5 | 2,001,669.46 | 163,766,913.10 |
| Prepayments | (VIII)6 | 37,664,552.30 | 63,627,425.42 |
| Other receivables | (VIII)7 | 940,014,994.01 | 948,842,094.30 |
| Including: Interest receivable | (VIII)7 | - | - |
| Dividends receivable | (VIII)7 | 343,386,866.06 | 416,040,485.62 |
| Inventories | (VIII)8 | 218,898,192.87 | 225,122,821.48 |
| Non-current assets due within one year | (VIII)9 | 17,451,380.98 | 902,225,293.93 |
| Other current assets | (VIII)10 | 189,673,500.87 | 185,903,140.53 |
| Total current assets | 23,483,208,238.91 | 20,416,742,717.23 | |
| Non-current Assets: | |||
| Long-term receivables | (VIII)11 | 3,856,466,116.99 | 5,661,327,499.07 |
| Long-term equity investments | (VIII)12 | 96,666,117,776.27 | 92,364,293,919.05 |
| Investments in other equity instruments | (VIII)13 | 157,461,648.16 | 171,945,275.02 |
| Other non-current financial assets | (VIII)14 | 877,576,442.83 | 1,745,740,896.41 |
| Investment properties | (VIII)15 | 4,958,374,968.79 | 5,123,690,119.56 |
| Fixed assets | (VIII)16 | 28,986,538,326.35 | 32,033,326,083.50 |
| Including: Fixed assets - cost | 51,987,700,820.76 | 55,185,206,442.91 | |
| Accumulated depreciation | 22,787,694,400.09 | 23,088,313,866.49 | |
| Provision for impairment of fixed assets | 213,504,483.08 | 63,574,868.76 | |
| Construction in progress | (VIII)17 | 2,909,817,281.46 | 2,413,844,407.64 |
| Right-of-use assets | (VIII)18 | 9,441,668,311.22 | 9,342,642,222.33 |
| Intangible assets | (VIII)19 | 18,073,062,184.72 | 19,277,065,115.61 |
| Development expenditure | (IX)2 | 50,990,153.18 | 17,412,196.16 |
| Goodwill | (VIII)20 | 6,493,002,246.44 | 6,411,426,891.09 |
| Long-term prepaid expenses | (VIII)21 | 993,793,505.29 | 986,356,904.90 |
| Deferred tax assets | (VIII)22 | 415,063,477.03 | 434,498,820.95 |
| Other non-current assets | (VIII)23 | 1,194,155,989.62 | 1,186,789,378.79 |
| Total non-current assets | 175,074,088,428.35 | 177,170,359,730.08 | |
| TOTAL ASSETS | 198,557,296,667.26 | 197,587,102,447.31 |
- 8 -
AT 31 DECEMBER 2023
Consolidated Balance Sheet - continued
RMB
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Notes | 31/12/2023 | 31/12/2022 (Restated) |
| Current liabilities: | |||
| Short-term borrowings | (VIII)24 | 15,714,045,288.97 | 7,164,338,366.18 |
| Notes payable | (VIII)25 | 73,461,165.82 | - |
| Accounts payable | (VIII)26 | 691,765,137.25 | 811,149,397.66 |
| Receipts in advance | (VIII)27 | 17,387,537.36 | 9,886,531.59 |
| Contract liabilities | (VIII)28 | 142,080,101.00 | 141,899,551.03 |
| Employee benefits payable | (VIII)29 | 917,964,606.65 | 936,834,718.13 |
| Including: Payroll payable | 883,913,277.13 | 897,442,262.83 | |
| Welfare payable | - | - | |
| Taxes payable | (VIII)30 | 923,053,572.50 | 917,933,169.09 |
| Other payables | (VIII)31 | 1,654,622,170.02 | 1,755,885,258.26 |
| Including: Interest payable | (VIII)31 | - | - |
| Dividends payable | (VIII)31 | 111,897,214.27 | 92,374,921.29 |
| Non-current liabilities due within one year | (VIII)32 | 6,817,404,289.25 | 11,641,223,688.95 |
| Other current liabilities | (VIII)33 | 2,143,842,534.53 | 3,161,147,525.96 |
| Total current liabilities | 29,095,626,403.35 | 26,540,298,206.85 | |
| Non-current Liabilities: | |||
| Long-term borrowings | (VIII)34 | 18,227,543,954.71 | 12,390,099,177.85 |
| Bonds payable | (VIII)35 | 14,287,508,564.15 | 19,088,293,099.02 |
| Including: Preferred shares | - | - | |
| Perpetual bonds | - | - | |
| Lease liabilities | (VIII)36 | 1,001,172,206.92 | 948,350,914.04 |
| Long-term payables | (VIII)37 | 3,822,862,202.17 | 3,551,315,590.31 |
| Long-term employee benefits payable | (VIII)38 | 603,009,921.91 | 639,095,931.43 |
| Provisions | (VIII)39 | 85,590,059.41 | 35,365,156.43 |
| Deferred income | (VIII)40 | 1,024,776,557.73 | 1,031,273,189.74 |
| Deferred tax liabilities | (VIII)22 | 4,659,638,104.37 | 4,855,019,835.33 |
| Other non-current liabilities | (VIII)41 | 179,634,263.73 | 186,383,117.00 |
| Total non-current liabilities | 43,891,735,835.10 | 42,725,196,011.15 | |
| TOTAL LIABILITIES | 72,987,362,238.45 | 69,265,494,218.00 | |
| Shareholders' equity: | |||
| Share capital | (VIII)42 | 2,499,074,661.00 | 2,499,074,661.00 |
| Including: State capital | - | - | |
| State-owned corporate capital | 2,264,090,797.00 | 2,283,118,870.00 | |
| Collective capital | - | - | |
| Private capital | 218,857,094.00 | 195,001,566.00 | |
| Foreign capital | 16,126,770.00 | 20,954,225.00 | |
| Capital reserve | (VIII)43 | 37,076,846,803.06 | 34,751,640,835.25 |
| Other comprehensive income | (VIII)44 | -903,626,594.35 | -689,553,619.86 |
| Special reserve | (VIII)45 | 34,003,994.41 | 26,358,259.97 |
| Surplus reserve | (VIII)46 | 1,095,980,563.68 | 1,001,917,449.15 |
| Unappropriated profit | (VIII)47 | 19,045,313,519.75 | 16,701,988,301.14 |
| Total equity attributable to shareholders of the Company | 58,847,592,947.55 | 54,291,425,886.65 | |
| Minority interests | 66,722,341,481.26 | 74,030,182,342.66 | |
| TOTAL SHAREHOLDERS' EQUITY | 125,569,934,428.81 | 128,321,608,229.31 | |
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | 198,557,296,667.26 | 197,587,102,447.31 |
The accompanying notes form part of the financial statements.
The financial statements were signed by the following:
Xu Song Tu Xiaoping Hu Shaode_______________________ _______________________ ___________________________Legal Representative Chief Financial Officer Head of Accounting Department
- 9 -
AT 31 DECEMBER 2023
Balance Sheet of the Company
RMB
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | Notes | 31/12/2023 | 31/12/2022 |
| Current Assets: | |||
| Cash and bank balances | 3,281,038,218.84 | 3,333,936,587.44 | |
| Held-for-trading financial assets | 1,500,517,808.22 | 1,502,601,369.86 | |
| Prepayments | 10,075,055.61 | - | |
| Other receivables | (XX)1 | 1,742,461,670.32 | 2,749,637,755.23 |
| Including: Interest receivable | (XX)1 | - | - |
| Dividends receivable | (XX)1 | 167,092,526.14 | 147,896,763.88 |
| Other current assets | 10,882,675.96 | 7,774,206.30 | |
| Total current assets | 6,544,975,428.95 | 7,593,949,918.83 | |
| Non-current Assets: | |||
| Long-term receivables | 9,391,615.50 | 9,240,200.34 | |
| Long-term equity investments | (XX)2 | 55,168,618,338.79 | 53,433,613,471.49 |
| Investments in other equity instruments | 148,088,364.25 | 144,700,378.28 | |
| Other non-current financial assets | - | 950,321,309.06 | |
| Fixed assets | 27,343,639.28 | 28,826,135.19 | |
| Including: Fixed assets - cost | 32,478,382.04 | 31,811,887.38 | |
| Accumulated depreciation | 5,134,742.76 | 2,985,752.19 | |
| Provision for impairment of fixed assets | - | - | |
| Construction in progress | 607,774.34 | 15,435,512.32 | |
| Intangible assets | 54,876,218.77 | 50,303,126.12 | |
| Development expenditure | 38,923,289.23 | 6,219,670.14 | |
| Long-term prepaid expenses | 665,319.42 | 873,700.49 | |
| Deferred tax assets | 928,465.21 | 928,465.21 | |
| Total non-current assets | 55,449,443,024.79 | 54,640,461,968.64 | |
| TOTAL ASSETS | 61,994,418,453.74 | 62,234,411,887.47 |
- 10 -
AT 31 DECEMBER 2023
Balance Sheet of the Company - continued
RMB
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | Notes | 31/12/2023 | 31/12/2022 |
| Current Liabilities: | |||
| Receipts in advance | 5,358,074.44 | - | |
| Employee benefits payable | 45,188,572.96 | 38,763,907.88 | |
| Including: Payroll payable | 45,032,983.18 | 38,672,237.18 | |
| Welfare payable | - | - | |
| Taxes payable | 1,046,270.66 | 1,251,923.17 | |
| Other payables | 376,323,201.93 | 373,569,651.65 | |
| Including: Interest payable | - | - | |
| Dividends payable | 34,577,578.12 | 34,577,578.12 | |
| Non-current liabilities due within one year | 5,119,243,623.45 | 2,146,233,151.54 | |
| Other current liabilities | 2,007,190,136.98 | 3,017,713,424.64 | |
| Total current liabilities | 7,554,349,880.42 | 5,577,532,058.88 | |
| Non-current Liabilities: | |||
| Long-term borrowings | 7,979,000,000.00 | 4,988,000,000.00 | |
| Bonds payable | 3,000,000,000.00 | 8,000,000,000.00 | |
| Deferred tax liabilities | 41,948,362.13 | 41,622,256.05 | |
| Total non-current liabilities | 11,020,948,362.13 | 13,029,622,256.05 | |
| TOTAL LIABILITIES | 18,575,298,242.55 | 18,607,154,314.93 | |
| SHAREHOLDERS' EQUITY | |||
| Share capital | 2,499,074,661.00 | 2,499,074,661.00 | |
| Including: State capital | - | - | |
| State-owned corporate capital | 2,264,090,797.00 | 2,283,118,870.00 | |
| Collective capital | - | - | |
| Private capital | 218,857,094.00 | 195,001,566.00 | |
| Foreign capital | 16,126,770.00 | 20,954,225.00 | |
| Capital reserve | 37,704,543,586.11 | 37,749,723,642.07 | |
| Other comprehensive income | 120,520,832.83 | 99,525,686.03 | |
| Surplus reserve | 1,095,980,563.68 | 1,001,917,449.15 | |
| Unappropriated profit | 1,999,000,567.57 | 2,277,016,134.29 | |
| TOTAL SHAREHOLDERS' EQUITY | 43,419,120,211.19 | 43,627,257,572.54 | |
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | 61,994,418,453.74 | 62,234,411,887.47 |
The accompanying notes form part of the financial statements.
- 11 -
FOR THE YEAR ENDED 31 DECEMBER 2023
Consolidated Income Statement
RMB
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Notes | 2023 | 2022 (Restated) |
| I. Total operating income | (VIII)48 | 15,750,475,780.22 | 16,230,489,127.55 |
| Less: Operating costs | (VIII)48 | 9,318,186,707.75 | 9,650,461,712.94 |
| Taxes and surcharges | (VIII)49 | 312,998,026.19 | 282,249,473.46 |
| Administrative expenses | (VIII)50 | 1,776,641,155.38 | 1,765,094,736.51 |
| Research and development expenses | (VIII)51 | 223,739,072.07 | 287,706,178.70 |
| Financial expenses | (VIII)52 | 1,839,113,328.14 | 2,258,713,672.42 |
| Including: Interest expenses | 2,238,152,796.66 | 2,225,162,805.79 | |
| Interest income | 497,593,921.36 | 469,834,098.05 | |
| Net exchange loss | 85,519,920.28 | 477,004,284.27 | |
| Add: Other income | (VIII)53 | 224,389,260.77 | 241,648,070.42 |
| Investment income | (VIII)54 | 6,348,676,940.80 | 7,377,655,506.33 |
| Including: Income from investments in associates and joint ventures | (VIII)54 | 5,979,007,585.96 | 7,185,182,148.75 |
| Gains (Losses) from changes in fair value (Losses are marked with "-") | (VIII)55 | 73,352,800.52 | -129,033,650.11 |
| Gains (Losses) from impairment of credit (Losses are marked with "-") | (VIII)56 | 37,284,041.18 | -223,473,576.55 |
| Losses from impairment of assets (Losses are marked with "-") | (VIII)57 | -191,297,311.28 | -22,159,020.20 |
| Gains from disposal of assets | (VIII)58 | 36,759,532.61 | 55,130,095.52 |
| II. Operating profit | 8,808,962,755.29 | 9,286,030,778.93 | |
| Add: Non-operating income | (VIII)59 | 87,302,024.12 | 279,274,452.77 |
| Including: Government grants | - | 1,640,553.77 | |
| Less: Non-operating expenses | (VIII)60 | 97,072,840.72 | 220,442,254.68 |
| III. Gross profit | 8,799,191,938.69 | 9,344,862,977.02 | |
| Less: Income tax expenses | (VIII)63 | 1,303,579,852.93 | 1,112,959,676.75 |
| IV. Net profit | 7,495,612,085.76 | 8,231,903,300.27 | |
| (I) Categorized by continuity of operation | |||
| 1. Net profit from continuing operation | 7,495,612,085.76 | 8,231,903,300.27 | |
| 2. Net profit from discontinued operation | - | - | |
| (II) Categorized by attribution of ownership | |||
| 1. Net profit attributable to shareholders of the Company | 3,571,800,762.16 | 3,338,693,816.70 | |
| 2. Profit or loss attributable to minority shareholders | 3,923,811,323.60 | 4,893,209,483.57 | |
| V. Other comprehensive income, net of tax | (VIII)66 | 209,856,768.77 | 1,628,631,938.02 |
| (I) Other comprehensive income attributable to shareholders of the Company, net of tax | -214,072,974.49 | 208,085,368.23 | |
| 1. Other comprehensive income that will not be reclassified to profit or loss | -73,874,071.89 | -22,706,023.29 | |
| (1) Changes from remeasurement of the defined benefit plan | 7,480,103.34 | -12,793,128.73 | |
| (2) Other comprehensive income that cannot be reclassified to profit or loss under the equity method | -83,841,725.07 | -11,550,762.02 | |
| (3) Changes in fair value of investments in other equity instruments | 2,487,549.84 | 1,637,867.46 | |
| 2. Other comprehensive income that will be reclassified subsequently to profit or loss | -140,198,902.60 | 230,791,391.52 | |
| (1) Other comprehensive income that can be reclassified to profit or loss under the equity method | -366,028,318.84 | -110,193,707.53 | |
| (2) Translation differences of financial statements denominated in foreign currencies | 225,829,416.24 | 340,985,099.05 | |
| (II) Other comprehensive income attributable to minority interests, net of tax | 423,929,743.26 | 1,420,546,569.79 | |
| VI. Total comprehensive income attributable to: | 7,705,468,854.53 | 9,860,535,238.29 | |
| (I) Shareholders of the Company | 3,357,727,787.67 | 3,546,779,184.93 | |
| (II) Minority shareholders | 4,347,741,066.86 | 6,313,756,053.36 | |
| VII. Earnings per share | |||
| (I) Basic earnings per share (Yuan/share) | 1.43 | 1.61 | |
| (II) Diluted earnings per share (Yuan/share) | 1.43 | 1.61 |
The accompanying notes form part of the financial statements.
- 12 -
FOR THE YEAR ENDED 31 DECEMBER 2023
Income Statement of the Company
RMB
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Notes | 2023 | 2022 |
| I. Operating income | (XX)3 | 17,326,885.29 | 3,669,891.36 |
| Less: Operating costs | (XX)3 | 3,686,411.84 | 2,276,202.60 |
| Taxes and surcharges | 2,161,621.42 | 1,126,365.82 | |
| Administrative expenses | 167,273,393.24 | 154,023,617.71 | |
| Research and development expenses | 14,046,526.98 | 15,151,413.80 | |
| Financial expenses | 397,006,521.97 | 361,633,510.16 | |
| Including: Interest expenses | 482,413,617.32 | 491,933,634.55 | |
| Interest income | 89,862,634.06 | 144,120,475.54 | |
| Net exchange loss | 2,296,890.14 | 3,785,346.40 | |
| Add: Other income | 206,131.06 | 499,438.35 | |
| Investment income | (XX)4 | 1,597,599,935.27 | 1,053,614,451.09 |
| Including: Income from investments in associates and joint ventures | (XX)4 | 1,111,522,805.93 | 384,257,363.02 |
| Losses from changes in fair value (Losses are marked with "-") | -48,217,517.53 | -125,383,212.19 | |
| Losses from impairment of assets (Losses are marked with "-") | -43,605,014.00 | - | |
| Gains from disposal of assets | - | 237,727.99 | |
| II. Operating profit | 939,135,944.64 | 398,427,186.51 | |
| Add: Non-operating income | 18,698.11 | 545,089.04 | |
| Less: Non-operating expenses | 104,998.04 | 18.84 | |
| III. Gross profit | 939,049,644.71 | 398,972,256.71 | |
| Less: Income tax expenses | -1,581,500.55 | -8,376,614.77 | |
| IV. Net profit | 940,631,145.26 | 407,348,871.48 | |
| V. Other comprehensive income, net of tax | 20,995,146.80 | 1,625,433.48 | |
| (I) Other comprehensive income that cannot be reclassified to profit or loss | 3,661,309.41 | 1,391,486.75 | |
| 1. Changes from remeasurement of the defined benefit plan | - | - | |
| 2. Other comprehensive income that cannot be reclassified to profit or loss under the equity method | 1,120,319.93 | 27,649.59 | |
| 3. Changes in fair value of investments in other equity instruments | 2,540,989.48 | 1,363,837.16 | |
| (II) Other comprehensive income that will be reclassified to profit or loss | 17,333,837.39 | 233,946.73 | |
| 1. Other comprehensive income that can be reclassified to profit or loss under the equity method | 17,333,837.39 | 233,946.73 | |
| 2. Translation differences of financial statements denominated in foreign currencies | - | - | |
| VI. Total comprehensive income | 961,626,292.06 | 408,974,304.96 |
The accompanying notes form part of the financial statements.
- 13 -
FOR THE YEAR ENDED 31 DECEMBER 2023
Consolidated Cash Flow Statement
RMB
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Notes | 2023 | 2022 |
| I. Cash Flows from Operating Activities: | |||
| Cash receipts from sales of goods and rendering of services | 16,019,658,434.90 | 16,547,850,742.82 | |
| Receipts of tax refunds | 53,272,648.95 | 239,426,543.45 | |
| Other cash receipts relating to operating activities | (VIII) 67(1) | 927,564,019.09 | 1,141,794,925.33 |
| Sub-total of cash inflows | 17,000,495,102.94 | 17,929,072,211.60 | |
| Cash payments for goods purchased and services received | 4,550,256,851.25 | 4,790,513,865.61 | |
| Cash payments to and on behalf of employees | 3,598,624,870.64 | 3,612,535,626.78 | |
| Payments of various types of taxes | 1,418,779,686.67 | 1,579,320,175.46 | |
| Other cash payments relating to operating activities | (VIII) 67(1) | 853,227,059.21 | 1,026,325,153.40 |
| Sub-total of cash outflows | 10,420,888,467.77 | 11,008,694,821.25 | |
| Net Cash Flows from Operating Activities | (VIII) 68(1) | 6,579,606,635.17 | 6,920,377,390.35 |
| II. Cash Flows from Investing Activities: | |||
| Cash receipts from disposal and recovery of investments | 28,430,740,038.14 | 40,894,899,081.53 | |
| Cash receipts from investments income | 2,329,944,728.79 | 2,429,981,136.20 | |
| Net cash receipts from disposal of fixed assets, intangible assets and other long-term assets | 144,845,803.86 | 13,812,483.21 | |
| Net cash receipts from disposals of subsidiaries and other business units | (VIII) 68(3) | 1,683,385,533.43 | - |
| Other cash receipts relating to investing activities | (VIII) 67(2) | 3,164,955,303.27 | 295,064,509.34 |
| Sub-total of cash inflows | 35,753,871,407.49 | 43,633,757,210.28 | |
| Cash payments to acquire or construct fixed assets, intangible assets and other long-term assets | 1,929,374,936.21 | 2,133,837,244.47 | |
| Cash payments to acquire investments | 29,974,648,554.87 | 54,509,066,114.35 | |
| Other cash payments relating to investing activities | (VIII) 67(2) | 82,663,303.33 | 954,802,482.30 |
| Sub-total of cash outflows | 31,986,686,794.41 | 57,597,705,841.12 | |
| Net Cash Flows from Investing Activities | 3,767,184,613.08 | -13,963,948,630.84 | |
| III. Cash Flows from Financing Activities: | |||
| Cash receipts from capital contributions | 217,520,934.61 | 10,642,126,434.50 | |
| Including: Cash receipts from capital contributions from minority shareholders of subsidiaries | 217,520,934.61 | - | |
| Cash receipts from borrowings | 29,416,872,247.55 | 29,859,438,534.05 | |
| Cash receipts from issue of bonds | 6,000,000,000.00 | 19,248,308,650.00 | |
| Other cash receipts relating to financing activities | (VIII) 67(3) | 334,754,229.63 | 56,303,169.80 |
| Sub-total of cash inflows | 35,969,147,411.79 | 59,806,176,788.35 | |
| Cash repayments of borrowings | 31,919,051,211.87 | 46,432,911,425.29 | |
| Cash payments for distribution of dividends or profits or settlement of interest expenses | 5,167,695,546.01 | 4,732,910,153.42 | |
| Including: Payments for distribution of dividends or profits to minority shareholders of subsidiaries | 1,955,677,172.68 | 1,900,086,012.38 | |
| Other cash payments relating to financing activities | (VIII) 67(3) | 6,867,093,830.32 | 1,124,116,740.35 |
| Sub-total of cash outflows | 43,953,840,588.20 | 52,289,938,319.06 | |
| Net Cash Flows from Financing Activities | -7,984,693,176.41 | 7,516,238,469.29 | |
| IV. Effect of Foreign Exchange Rate Changes on Cash and Cash Equivalents | 89,206,087.64 | 367,287,004.46 | |
| V. Net Increase in Cash and Cash Equivalents | 2,451,304,159.48 | 839,954,233.26 | |
| Add: Opening balance of cash and cash equivalents | (VIII) 68(2) | 13,567,309,471.62 | 12,727,355,238.36 |
| VI. Closing Balance of Cash and Cash Equivalents | (VIII) 68(2) | 16,018,613,631.10 | 13,567,309,471.62 |
The accompanying notes form part of the financial statements.
- 14 -
FOR THE YEAR ENDED 31 DECEMBER 2023
Cash Flow Statement of the Company
RMB
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Notes | 2023 | 2022 |
| I. Cash Flows from Operating Activities: | |||
| Other cash receipts relating to operating activities | 205,894,785.22 | 108,295,282.75 | |
| Sub-total of cash inflows | 205,894,785.22 | 108,295,282.75 | |
| Cash payments for goods purchased and services received | 142,500.00 | 86,280.54 | |
| Cash payments to and on behalf of employees | 111,864,640.42 | 102,305,409.21 | |
| Payments of various types of taxes | 2,203,522.03 | 162,077,694.07 | |
| Other cash payments relating to operating activities | 197,101,786.33 | 64,738,420.24 | |
| Sub-total of cash outflows | 311,312,448.78 | 329,207,804.06 | |
| Net Cash Flows from Operating Activities | -105,417,663.56 | -220,912,521.31 | |
| II. Cash Flows from Investing Activities: | |||
| Cash receipts from disposal and recovery of investments | 11,200,000,000.00 | 33,317,450,238.74 | |
| Cash receipts from investment income | 934,979,575.11 | 770,719,728.64 | |
| Net cash receipts from disposal of fixed assets, intangible assets and other long-term assets | - | 1,002,668.00 | |
| Other cash receipts relating to investing activities | 1,948,842,841.79 | 50,285,632.68 | |
| Sub-total of cash inflows | 14,083,822,416.90 | 34,139,458,268.06 | |
| Cash payments to acquire or construct fixed assets, intangible assets and other long-term assets | 23,594,300.69 | 42,642,426.69 | |
| Cash payments to acquire investments | 11,589,128,994.69 | 45,942,721,212.13 | |
| Other cash payments relating to investing activities | 890,011,664.40 | 1,523,809,248.36 | |
| Sub-total of cash outflows | 12,502,734,959.78 | 47,509,172,887.18 | |
| Net Cash Flows from Investing Activities | 1,581,087,457.12 | -13,369,714,619.12 | |
| III. Cash Flows from Financing Activities: | |||
| Cash receipts from capital contributions | - | 10,642,126,434.50 | |
| Cash receipts from borrowings | 6,250,000,000.00 | 9,171,668,674.85 | |
| Cash receipts from issue of bonds | 6,000,000,000.00 | 16,000,000,000.00 | |
| Other cash receipts relating to financing activities | 6,728,017.13 | 6,303,169.80 | |
| Sub-total of cash inflows | 12,256,728,017.13 | 35,820,098,279.15 | |
| Cash repayments of borrowings | 12,125,000,000.00 | 20,529,408,504.85 | |
| Cash payments for distribution of dividends or profits or settlement of interest expenses | 1,650,693,345.10 | 1,257,422,374.13 | |
| Other cash payments relating to financing activities | 9,832,313.92 | 23,179,821.90 | |
| Sub-total of cash outflows | 13,785,525,659.02 | 21,810,010,700.88 | |
| Net Cash Flows from Financing Activities | -1,528,797,641.89 | 14,010,087,578.27 | |
| IV. Effect of Foreign Exchange Rate Changes on Cash and Cash Equivalents | 176,979.73 | 714,582.29 | |
| V. Net (Decrease) Increase in Cash and Cash Equivalents (Losses are marked with "-") | -52,950,868.60 | 420,175,020.13 | |
| Add: Opening balance of cash and cash equivalents | 3,333,936,587.44 | 2,913,761,567.31 | |
| VI. Closing Balance of Cash and Cash Equivalents | 3,280,985,718.84 | 3,333,936,587.44 |
The accompanying notes form part of the financial statements.
- 15 -
FOR THE YEAR ENDED 31 DECEMBER 2023
Consolidated Statement of Changes in Shareholders' Equity
RMB
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 2023 | ||||||||
| Equity attributable to shareholders of the Company | Minority interests | Total shareholders' equity | |||||||
| Share capital | Capital reserve | Other comprehensive income | Including: Foreign currency conversion difference | Special reserve | Surplus reserve | Unappropriated profit | |||
| I. Closing balance of the preceding year | 2,499,074,661.00 | 34,751,640,835.25 | -691,536,248.44 | -681,788,363.07 | 26,358,259.97 | 1,001,917,449.15 | 16,679,688,347.09 | 73,994,641,893.21 | 128,261,785,197.23 |
| Add: Changes in accounting policies | - | - | 1,982,628.58 | 1,982,628.58 | - | - | 22,299,954.05 | 35,540,449.45 | 59,823,032.08 |
| Corrections of prior period errors | - | - | - | - | - | - | - | - | - |
| Business combination involving enterprises under common control | - | - | - | - | - | - | - | - | - |
| Others | - | - | - | - | - | - | - | - | - |
| II. Opening balance of the year | 2,499,074,661.00 | 34,751,640,835.25 | -689,553,619.86 | -679,805,734.49 | 26,358,259.97 | 1,001,917,449.15 | 16,701,988,301.14 | 74,030,182,342.66 | 128,321,608,229.31 |
| III. Changes for the year | - | 2,325,205,967.81 | -214,072,974.49 | 225,829,416.24 | 7,645,734.44 | 94,063,114.53 | 2,343,325,218.61 | -7,307,840,861.40 | -2,751,673,800.50 |
| (I) Total comprehensive income | - | - | -214,072,974.49 | 225,829,416.24 | - | - | 3,571,800,762.16 | 4,347,741,066.86 | 7,705,468,854.53 |
| (II) Owners' contributions and reduction in capital | - | 2,325,205,967.81 | - | - | -317,684.31 | - | -1,883,909.97 | -9,190,432,492.89 | -6,867,428,119.36 |
| 1. Ordinary shares contributed by owners | - | - | - | - | - | - | - | 685,424,826.14 | 685,424,826.14 |
| 2. Capital contribution from holders of other equity instruments | - | - | - | - | - | - | - | -4,222,148,460.84 | -4,222,148,460.84 |
| 3. Share-based payment recognized in shareholders' equity | - | 1,053,188.36 | - | - | - | - | - | 523,302.32 | 1,576,490.68 |
| 4. Others | - | 2,324,152,779.45 | - | - | -317,684.31 | - | -1,883,909.97 | -5,654,232,160.51 | -3,332,280,975.34 |
| (III) Profit distribution | - | - | - | - | - | 94,063,114.53 | -1,226,591,633.58 | -2,477,802,768.49 | -3,610,331,287.54 |
| 1. Transfer to surplus reserve | - | - | - | - | - | 94,063,114.53 | -94,063,114.53 | - | - |
| 2. Distribution to shareholders | - | - | - | - | - | - | -1,124,583,597.45 | -2,256,143,657.02 | -3,380,727,254.47 |
| 3. Others | - | - | - | - | - | - | -7,944,921.60 | -221,659,111.47 | -229,604,033.07 |
| (IV) Transfers within shareholders' equity | - | - | - | - | - | - | - | - | - |
| 1. Capitalization of capital reserve | - | - | - | - | - | - | - | - | - |
| 2. Capitalization of surplus reserve | - | - | - | - | - | - | - | - | - |
| 3. Loss offset by surplus reserve | - | - | - | - | - | - | - | - | - |
| 4. Retained earnings carried forward from other comprehensive income | - | - | - | - | - | - | - | - | - |
| 5. Others | - | - | - | - | - | - | - | - | - |
| (V) Special reserve | - | - | - | - | 7,963,418.75 | - | - | 12,653,333.12 | 20,616,751.87 |
| 1. Transfer to special reserve in the year | - | - | - | - | 61,589,514.21 | - | - | 66,309,179.08 | 127,898,693.29 |
| 2. Amount utilized in the year | - | - | - | - | -53,626,095.46 | - | - | -53,655,845.96 | -107,281,941.42 |
| (VI) Others | - | - | - | - | - | - | - | - | - |
| IV. Closing balance of the year | 2,499,074,661.00 | 37,076,846,803.06 | -903,626,594.35 | -453,976,318.25 | 34,003,994.41 | 1,095,980,563.68 | 19,045,313,519.75 | 66,722,341,481.26 | 125,569,934,428.81 |
- 16 -
FOR THE YEAR ENDED 31 DECEMBER 2023
Consolidated Statement of Changes in Shareholders' Equity - continued
RMB
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 2022 (Restated) | ||||||||
| Equity attributable to shareholders of the Company | Minority interests | Total shareholders' equity | |||||||
| Share capital | Capital reserve | Other comprehensive income | Including: Foreign currency conversion difference | Special reserve | Surplus reserve | Unappropriated profit | |||
| I. Closing balance of the preceding year | 1,922,365,124.00 | 23,592,702,758.70 | -890,125,318.18 | -1,020,790,833.54 | 9,184,429.12 | 961,182,562.00 | 14,205,879,106.49 | 71,234,238,229.35 | 111,035,426,891.48 |
| Add: Changes in accounting policies | - | - | - | - | - | - | 21,052,360.17 | 33,445,604.29 | 54,497,964.46 |
| Corrections of prior period errors | - | - | - | - | - | - | - | - | - |
| Business combination involving enterprises under common control | - | - | - | - | - | - | - | - | - |
| Others | - | - | - | - | - | - | - | - | - |
| II. Opening balance of the year | 1,922,365,124.00 | 23,592,702,758.70 | -890,125,318.18 | -1,020,790,833.54 | 9,184,429.12 | 961,182,562.00 | 14,226,931,466.66 | 71,267,683,833.64 | 111,089,924,855.94 |
| III. Changes for the year | 576,709,537.00 | 11,158,938,076.55 | 200,571,698.32 | 340,985,099.05 | 17,173,830.85 | 40,734,887.15 | 2,475,056,834.48 | 2,762,498,509.02 | 17,231,683,373.37 |
| (I) Total comprehensive income | - | - | 208,085,368.23 | 340,985,099.05 | - | - | 3,338,693,816.70 | 6,313,756,053.36 | 9,860,535,238.29 |
| (II) Owners' contributions and reduction in capital | 576,709,537.00 | 11,158,938,076.55 | - | - | - | - | - | -683,588,937.26 | 11,052,058,676.29 |
| 1. Ordinary shares contributed by owners | 576,709,537.00 | 10,055,823,793.40 | - | - | - | - | - | 971,135,730.31 | 11,603,669,060.71 |
| 2. Capital contribution from holders of other equity instruments | - | - | - | - | - | - | - | - | - |
| 3. Share-based payment recognized in shareholders' equity | - | -4,365,536.60 | - | - | - | - | - | -3,266,354.51 | -7,631,891.11 |
| 4. Others | - | 1,107,479,819.75 | - | - | - | - | - | -1,651,458,313.06 | -543,978,493.31 |
| (III) Profit distribution | - | - | - | - | - | 40,734,887.15 | -871,150,652.13 | -2,897,141,819.77 | -3,727,557,584.75 |
| 1. Transfer to surplus reserve | - | - | - | - | - | 40,734,887.15 | -40,734,887.15 | - | - |
| 2. Transfer to general risk reserve | - | - | - | - | - | - | - | - | - |
| 3. Distribution to shareholders | - | - | - | - | - | - | -826,617,003.32 | -2,698,588,539.77 | -3,525,205,543.09 |
| 4. Others | - | - | - | - | - | - | -3,798,761.66 | -198,553,280.00 | -202,352,041.66 |
| (IV) Transfers within shareholders' equity | - | - | -7,513,669.91 | - | - | - | 7,513,669.91 | - | - |
| 1. Capitalization of capital reserve | - | - | - | - | - | - | - | - | - |
| 2. Capitalization of surplus reserve | - | - | - | - | - | - | - | - | - |
| 3. Loss offset by surplus reserve | - | - | - | - | - | - | - | - | - |
| 4. Retained earnings carried forward from other comprehensive income | - | - | -7,513,669.91 | - | - | - | 7,513,669.91 | - | - |
| 5. Others | - | - | - | - | - | - | - | - | - |
| (V) Special reserve | - | - | - | - | 17,173,830.85 | - | - | 29,473,212.69 | 46,647,043.54 |
| 1. Transfer to special reserve in the year | - | - | - | - | 62,696,039.72 | - | - | 86,478,912.67 | 149,174,952.39 |
| 2. Amount utilized in the year | - | - | - | - | -45,522,208.87 | - | - | -57,005,699.98 | -102,527,908.85 |
| (VI) Others | - | - | - | - | - | - | - | - | - |
| IV. Closing balance of the year | 2,499,074,661.00 | 34,751,640,835.25 | -689,553,619.86 | -679,805,734.49 | 26,358,259.97 | 1,001,917,449.15 | 16,701,988,301.14 | 74,030,182,342.66 | 128,321,608,229.31 |
The accompanying notes form part of the financial statements.
- 17 -
FOR THE YEAR ENDED 31 DECEMBER 2023
The Company's Statement of Changes in Shareholders' Equity
RMB
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 2023 | ||||||
| Share capital | Capital reserve | Other comprehensive income | Special reserve | Surplus reserve | Unappropriated profit | Total shareholders' equity | |
| I. Closing balance of the preceding year | 2,499,074,661.00 | 37,749,723,642.07 | 99,525,686.03 | - | 1,001,917,449.15 | 2,277,016,134.29 | 43,627,257,572.54 |
| Add: Changes in accounting policies | - | - | - | - | - | - | - |
| Corrections of prior period errors | - | - | - | - | - | - | - |
| Others | - | - | - | - | - | - | - |
| II. Opening balance of the year | 2,499,074,661.00 | 37,749,723,642.07 | 99,525,686.03 | - | 1,001,917,449.15 | 2,277,016,134.29 | 43,627,257,572.54 |
| III. Changes for the year | - | -45,180,055.96 | 20,995,146.80 | - | 94,063,114.53 | -278,015,566.72 | -208,137,361.35 |
| (I) Total comprehensive income | - | - | 20,995,146.80 | - | - | 940,631,145.26 | 961,626,292.06 |
| (II) Owners' contributions and reduction in capital | - | -45,180,055.96 | - | - | - | - | -45,180,055.96 |
| 1. Ordinary shares contributed by owners | - | - | - | - | - | - | - |
| 2. Share-based payment recognized in shareholders' equity | - | - | - | - | - | - | - |
| 3. Share-based payment recognized in owners' equity | - | 1,890,784.31 | - | - | - | - | 1,890,784.31 |
| 4. Others | - | -47,070,840.27 | - | - | - | - | -47,070,840.27 |
| (III) Profit distribution | - | - | - | - | 94,063,114.53 | -1,218,646,711.98 | -1,124,583,597.45 |
| 1. Transfer to surplus reserve | - | - | - | - | 94,063,114.53 | -94,063,114.53 | - |
| 2 Distribution to shareholders | - | - | - | - | - | -1,124,583,597.45 | -1,124,583,597.45 |
| 3. Others | - | - | - | - | - | - | - |
| (IV) Transfers within shareholders' equity | - | - | - | - | - | - | - |
| 1. Capitalization of capital reserve | - | - | - | - | - | - | - |
| 2. Capitalization of surplus reserve | - | - | - | - | - | - | - |
| 3. Loss offset by surplus reserve | - | - | - | - | - | - | - |
| 4. Retained earnings carried forward from other comprehensive income | - | - | - | - | - | - | - |
| 5. Others | - | - | - | - | - | - | - |
| (V) Special reserve | - | - | - | - | - | - | - |
| 1. Transfer to special reserve in the year | - | - | - | - | - | - | - |
| 2. Amount utilized in the year | - | - | - | - | - | - | - |
| (VI) Others | - | - | - | - | - | - | - |
| IV. Closing balance of the year | 2,499,074,661.00 | 37,704,543,586.11 | 120,520,832.83 | - | 1,095,980,563.68 | 1,999,000,567.57 | 43,419,120,211.19 |
- 18 -
FOR THE YEAR ENDED 31 DECEMBER 2023
The Company's Statement of Changes in Shareholders' Equity - continued
RMB
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 2022 | ||||||
| Share capital | Capital reserve | Other comprehensive income | Special reserve | Surplus reserve | Unappropriated profit | Total shareholders' equity | |
| I. Closing balance of the preceding year | 1,922,365,124.00 | 27,594,079,596.13 | 105,412,294.52 | - | 961,182,562.00 | 2,729,507,111.31 | 33,312,546,687.96 |
| Add: Changes in accounting policies | - | - | - | - | - | - | - |
| Corrections of prior period errors | - | - | - | - | - | - | - |
| Others | - | - | - | - | - | - | - |
| II. Opening balance of the year | 1,922,365,124.00 | 27,594,079,596.13 | 105,412,294.52 | - | 961,182,562.00 | 2,729,507,111.31 | 33,312,546,687.96 |
| III. Changes for the year | 576,709,537.00 | 10,155,644,045.94 | -5,886,608.49 | - | 40,734,887.15 | -452,490,977.02 | 10,314,710,884.58 |
| (I) Total comprehensive income | - | - | 1,625,433.48 | - | - | 407,348,871.48 | 408,974,304.96 |
| (II) Owners' contributions and reduction in capital | 576,709,537.00 | 10,155,644,045.94 | - | - | - | - | 10,732,353,582.94 |
| 1. Ordinary shares contributed by owners | 576,709,537.00 | 10,055,823,793.40 | - | - | - | - | 10,632,533,330.40 |
| 2. Share-based payment recognized in shareholders' equity | - | -6,388,558.75 | - | - | - | - | -6,388,558.75 |
| 3. Others | - | 106,208,811.29 | - | - | - | - | 106,208,811.29 |
| (III) Profit distribution | - | - | - | - | 40,734,887.15 | -867,351,890.47 | -826,617,003.32 |
| 1. Transfer to surplus reserve | - | - | - | - | 40,734,887.15 | -40,734,887.15 | - |
| 2. Transfer to general risk reserve | - | - | - | - | - | - | - |
| 3. Distribution to shareholders | - | - | - | - | - | -826,617,003.32 | -826,617,003.32 |
| 4. Others | - | - | - | - | - | - | - |
| (IV) Transfers within shareholders' equity | - | - | -7,512,041.97 | - | - | 7,512,041.97 | - |
| 1. Capitalization of capital reserve | - | - | - | - | - | - | - |
| 2. Capitalization of surplus reserve | - | - | - | - | - | - | - |
| 3. Loss offset by surplus reserve | - | - | - | - | - | - | - |
| 4. Retained earnings carried forward from other comprehensive income | - | - | -7,512,041.97 | - | - | 7,512,041.97 | - |
| 5. Others | - | - | - | - | - | - | - |
| (V) Special reserve | - | - | - | - | - | - | - |
| 1. Transfer to special reserve in the year | - | - | - | - | - | - | - |
| 2. Amount utilized in the year | - | - | - | - | - | - | - |
| (VI) Others | - | - | - | - | - | - | - |
| IV. Closing balance of the year | 2,499,074,661.00 | 37,749,723,642.07 | 99,525,686.03 | - | 1,001,917,449.15 | 2,277,016,134.29 | 43,627,257,572.54 |
The accompanying notes form part of the financial statements.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 19 -
(I) GENERAL INFORMATION OF THE COMPANY
China Merchants Port Group Co., Ltd. (hereinafter referred to as the "Company") is a stock limitedcompany incorporated in Shenzhen, Guangdong Province, on 16 January 1993.
The headquarters of the Company is located in Shenzhen, Guangdong Province. The Company andits subsidiaries (collectively the "Group") are actually engaged in the principal operating activitiesof port service, bonded logistics service and other businesses such as property development andinvestment.
The Company's and consolidated financial statements were approved by the Board of Directors on29 March 2024.
(II) BASIS OF PREPARATION OF FINANCIAL STATEMENTS
Basis of preparation of financial statements
The Group has adopted the Accounting Standards for Business Enterprises ("ASBE") issued by theMinistry of Finance ("MoF"). In addition, the Group has disclosed relevant financial informationin accordance with Information Disclosure and Presentation Rules for Companies OfferingSecurities to the Public No. 15 - General Provisions on Financial Reporting (Revised in 2023).
Going concern
As at 31 December 2023, the Group had total current liabilities in excess of total current assets byRMB 5,612,418,164.44. As at 31 December 2023, the Group had available and unused line of creditand bonds amounting to RMB 69,439,268,355.68, which is greater than the balance of the netcurrent liabilities. The Group can obtain financial support from the available line of credit and bondswhen needed. Therefore, the financial statements have been prepared on a going concern basis.
(III) STATEMENT OF COMPLIANCE WITH THE ASBE
The financial statements of the Company have been prepared in accordance with ASBE, and presenttruly and completely, the Company's and consolidated financial position as at 31 December 2023,and the Company's and consolidated results of operations and cash flows for the year then ended.
(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES
1. Accounting year
The Group has adopted the calendar year as its accounting year, e.g., from 1 January to 31 December.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 20 -
(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
2. Operating cycle
An operating cycle refers to the period since when an enterprise purchases assets for processingpurpose till the realization of those assets in cash or cash equivalents. The Group is principallyengaged in the rendering of port service, bonded logistics service and other businesses such asproperty development and investment with one year being an operating cycle.
3. Functional currency
Renminbi ("RMB") is the currency of the primary economic environment in which the Companyand its domestic subsidiaries operate. Therefore, the Company and its domestic subsidiaries chooseRMB as their functional currency. The Company's overseas subsidiaries choose their functionalcurrencies on the basis of the primary economic environment in which they operate. The Companyadopts RMB to prepare its financial statements.
4. Method for determination of materiality criteria and basis for selection
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Materiality criteria |
| Significant prepayments aged more than 1 year | The amount exceeds RMB 10 million individually |
| Significant dividends receivable aged more than 1 year | The amount exceeds RMB 50 million individually |
| Significant other receivables for which bad debt provision is assessed on an individual basis | The amount exceeds RMB 10 million individually |
| Reversal or recovery of significant bad debt provision | The amount exceeds RMB 10 million individually |
| Impairment testing of significant long-term equity investments | The carrying amount of an individual long-term equity investment≥2% of the amount of total assets |
| Significant construction in progress | The year-end carrying amount of an individual construction in progress ranges top ten |
| Impairment testing of significant construction in progress | The carrying amount of an individual construction in progress ≥20% of the amount of total assets |
| Significant accounts payable aged more than 1 year | The amount exceeds RMB 10 million individually |
| Significant receipts in advance aged more than 1 year | The amount exceeds RMB 10 million individually |
| Significant contract liabilities aged more than 1 year | The amount exceeds RMB 10 million individually |
| Significant dividends payable aged more than 1 year | The amount exceeds RMB 50 million individually |
| Significant other payables aged more than 1 year | The amount exceeds RMB 10 million individually |
| Cash flows from significant investing activities | The amount exceeds 0.5% of the amount of total assets individually |
| Significant non-wholly owned subsidiaries | The amount of total revenue or total assets of subsidiaries exceeds 15% of the amount of total consolidated revenue or total consolidated assets |
| Significant joint ventures or associates | Joint ventures or associates in which the carrying amount of a long-term equity investment accounts for ≥10% of the amount of total consolidated assets or in which the investment income recognized under the equity method accounts for ≥10% of the amount of total consolidated profit |
| Significant commitments | The amount exceeds 0.3% of the amount of total assets individually, including reorganization, mergers and acquisitions, and building of construction in progress, etc. |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 21 -
(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
5. Basis of accounting and principle of measurement
The Group has adopted the accrual basis of accounting. Except for financial instruments which aremeasured at fair value, the Group adopts the historical cost as the principle of measurement of thefinancial statements. Upon being restructured into a stock company, the fixed assets and intangibleassets initially contributed by the state-owned shareholders are recognized based on the valuationamounts confirmed by the state-owned assets administration department. Where assets are impaired,provisions for asset impairment are made in accordance with the relevant requirements.
Where the historical cost is adopted as the measurement basis, assets are recorded at the amount ofcash or cash equivalents paid or the fair value of the consideration given to acquire them at the timeof their acquisition. Liabilities are recorded at the amount of proceeds or assets received or thecontractual amounts for assuming the present obligation, or, at the amounts of cash or cashequivalents expected to be paid to settle the liabilities in the normal course of business.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in anorderly transaction between market participants at the measurement date, regardless of whether thatprice is directly observable or estimated using valuation technique. Fair value measurement and/ordisclosure in the financial statements are determined according to the above basis.
In the measurement of non-financial assets at fair value, market participants' ability to best utilizesuch assets to generate most economic benefits, or the ability to sell such assets to other marketparticipants who are able to best utilize the assets to generate economic benefits is taken intoaccount.
For financial assets of which transaction prices are the fair value on initial recognition, and of whichvaluation technique involving unobservable input is used in subsequent measurement, the valuationtechnique in the course of valuation is adjusted to enable the result of initial recognition based onthe valuation technique equal to the transaction price.
Fair value measurements are categorized into Level 1, 2 or 3 based on the degree to which the inputsto the fair value measurements are observable and the significance of the inputs to the fair valuemeasurement in its entirety, which are described as follows:
? Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities thatthe entity can access at the measurement date;? Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable
for the asset or liability, either directly or indirectly; and? Level 3 inputs are unobservable inputs for the asset or liability.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 22 -
(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
6. Business combinations
Business combinations are classified into business combinations involving enterprises undercommon control and business combinations not involving enterprises under common control.
6.1 Business combinations involving enterprises under common control
A business combination involving enterprises under common control is a business combination inwhich all of the combining enterprises are ultimately controlled by the same party or parties bothbefore and after the combination, and that control is not transitory.
Assets and liabilities obtained shall be measured at their respective carrying amounts as recordedby the combining entities at the date of the combination. The difference between the carryingamount of the net assets obtained and the carrying amount of the consideration paid for thecombination is adjusted to the share premium in capital reserve. If the share premium is notsufficient to absorb the difference, any excess shall be adjusted against retained earnings.
Costs that are directly attributable to the combination are charged to profit or loss in the period inwhich they are incurred.
6.2 Business combinations not involving enterprises under common control and goodwill
A business combination not involving enterprises under common control is a business combinationin which all of the combining enterprises are not ultimately controlled by the same party or partiesbefore and after the combination.
The cost of combination is the aggregate of the fair values, at the acquisition date, of the assetsgiven, liabilities incurred or assumed, and equity securities issued by the acquirer, in exchange forcontrol of the acquiree. Where a business combination not involving enterprises under commoncontrol is achieved in stages that involve multiple transactions, the cost of combination is the sumof the consideration paid at the acquisition date and the fair value at the acquisition date of theacquirer's previously held interest in the acquiree. The intermediary expenses (fees in respect ofauditing, legal services, valuation and consultancy services, etc.) and other administrative expensesattributable to the business combination are recognized in profit or loss in the periods when theyare incurred.
The acquiree's identifiable assets, liabilities and contingent liabilities acquired by the acquirer in abusiness combination that meet the recognition criteria shall be measured at fair value at theacquisition date.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 23 -
(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
6. Business combinations - continued
6.2 Business combinations not involving enterprises under common control and goodwill- continued
When a business combination contract provides for the acquirer's recovery of considerationpreviously paid contingent on one or multiple future event(s), the Group recognizes the contingentconsideration provided in the contract as an asset, as part of the consideration transferred in thebusiness combination, and includes it in the cost of business combination at the fair value at theacquisition date. Within 12 months after the acquisition, where the contingent consideration needsto be adjusted as new or further evidences are obtained in respect of the circumstances existed atthe acquisition date, the adjustment shall be recognized and the amount originally recognized ingoodwill or non-operating income shall be adjusted. A change in or adjustment to the contingentconsideration under other circumstances shall be accounted for in accordance with AccountingStandards for Business Enterprise No. 22 - Financial Instruments: Recognition and Measurementand Accounting Standards for Business Enterprises No. 13 - Contingencies. Any change oradjustment is included in profit or loss for the current period.
Where the cost of combination exceeds the acquirer's interest in the fair value of the acquiree'sidentifiable net assets, the difference is treated as an asset and recognized as goodwill, which ismeasured at cost on initial recognition. Where the cost of combination is less than the acquirer'sinterest in the fair value of the acquiree's identifiable net assets, the acquirer reassesses themeasurement of the fair values of the acquiree's identifiable assets, liabilities and contingentliabilities and measurement of the cost of combination. If after that reassessment, the cost ofcombination is still less than the acquirer's interest in the fair value of the acquiree's identifiable netassets, the acquirer recognizes the remaining difference immediately in profit or loss for the currentperiod.
If either the fair values of identifiable assets, liabilities and contingent liabilities acquired in acombination or the cost of business combination can be determined only provisionally by the endof the period in which the business combination was affected, the acquirer recognizes and measuresthe combination using those provisional values. Any adjustments to those provisional values withintwelve months after the acquisition date are treated as if they had been recognized and measured onthe acquisition date.
Goodwill arising from a business combination is measured at cost less accumulated impairmentlosses, and is presented separately in the consolidated financial statements.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
7. Consolidated financial statements
7.1 Determination criteria of control
Control exists when the investor has power over the investee; is exposed, or has rights, to variablereturns from its involvement with the investee; and has the ability to use its power over the investeeto affect its returns. The Group reassesses whether or not it controls an investee if facts andcircumstances indicate that there are changes in the above elements of the definition of control.
7.2 Preparation of consolidated financial statements
The scope of consolidation in the consolidated financial statements is determined on the basis ofcontrol.
Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceaseswhen the Group loses control of the subsidiary.
For a subsidiary already disposed of by the Group, the operating results and cash flows before thedate of disposal (the date when control is lost) are included in the consolidated income statementand consolidated cash flow statement, as appropriate.
For subsidiaries acquired through a business combination involving enterprises not under commoncontrol, the operating results and cash flows from the acquisition date (the date when control isobtained) are included in the consolidated income statement and consolidated cash flow statement,as appropriate.
No matter when the business combination occurs in the reporting period, subsidiaries acquiredthrough a business combination involving enterprises under common control or the party beingabsorbed under merger by absorption are included in the Group's scope of consolidation as if theyhad been included in the scope of consolidation from the date when they first came under thecommon control of the ultimate controlling party. Their operating results and cash flows from thedate when they first came under the common control of the ultimate controlling party are includedin the consolidated income statement and consolidated cash flow statement, as appropriate.
The significant accounting policies and accounting periods adopted by the subsidiaries aredetermined based on the uniform accounting policies and accounting periods set out by theCompany.
Where the accounting policies and accounting periods adopted by subsidiaries are inconsistent withthose of the Company, appropriate adjustments are made to the subsidiaries' financial statements inaccordance with the accounting policies of the Company.
All significant intra-group balances and transactions are eliminated on consolidation.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
7. Consolidated financial statements - continued
7.2 Preparation of consolidated financial statements - continued
The portion of subsidiaries' equity that is not attributable to the Company is treated as minorityinterests and presented as "minority interests" in the consolidated balance sheet under the line itemof shareholders' equity. The portion of net profits or losses of subsidiaries for the period attributableto minority interests is presented as "minority interests" in the consolidated income statement underthe line item of "net profit". The portion of comprehensive income of subsidiaries for the periodattributable to minority interests is presented as "total comprehensive income attributable tominority shareholders" in the consolidated income statement under the line item of "totalcomprehensive income".
When the amount of loss for the period attributable to the minority shareholders of a subsidiaryexceeds the minority shareholders' portion of the opening balance of owners' equity of thesubsidiary, the excess amount is still allocated against minority interests.
Acquisition of minority interests or disposal of interests in a subsidiary that does not result in theloss of control over the subsidiary is accounted for as equity transactions. The carrying amounts ofthe Company's interests and minority interests are adjusted to reflect the changes in their relativeinterests in the subsidiary. The difference between the amount by which the minority interests areadjusted and the fair value of the consideration paid or received is adjusted to capital reserve. If thecapital reserve is not sufficient to absorb the difference, the excess is adjusted against retainedearnings.
For the stepwise acquisition of equity interest till acquiring control after a few transactions andleading to business combination not involving enterprises under common control, it shall be dealtwith based on whether it belongs to 'package deal': if it belongs to 'package deal', it will beaccounted for as a transactions to acquire control; if it does not belong to 'package deal', it will beaccounted for as a transaction to acquire control on acquisition date, and the fair value of acquiree'shares held before acquisition date will be revalued, and the difference between fair value andcarrying amount will be recognized in profit or loss of the current period; if acquiree' shares heldbefore acquisition date involve changes in other comprehensive income and other changes inowners' equity under equity method, it will be transferred to income of acquisition date.
When the Group loses control over a subsidiary due to disposal of equity investment or otherreasons, any retained interest is re-measured at its fair value at the date when control is lost. Thedifference between (i) the aggregate of the consideration received on disposal and the fair value ofany retained interest and (ii) the share of the former subsidiary's net assets cumulatively calculatedfrom the acquisition date according to the original proportion of ownership interests is recognizedas investment income in the period in which control is lost, and the goodwill is offset accordingly.Other comprehensive income associated with investment in the former subsidiary is reclassified toinvestment income in the period in which control is lost.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
7. Consolidated financial statements - continued
7.2 Preparation of consolidated financial statements - continued
When the Group loses control of a subsidiary in two or more arrangements (transactions), termsand conditions of the arrangements (transactions) and their economic effects are considered. Oneor more of the following indicate that the Group shall account for the multiple arrangements as a'package deal': (i) they are entered into at the same time or in contemplation of each other; (ii) theyform a complete transaction designed to achieve an overall commercial effect; (iii) the occurrenceof one transaction is dependent on the occurrence of at least one other transaction; (iv) onetransaction alone is not economically justified, but it is economically justified when consideredtogether with other transactions. Where the transactions of disposal of equity investments in asubsidiary until the loss of control are assessed as a package deal, these transactions are accountedfor as one transaction of disposal of a subsidiary with loss of control. Before losing control, thedifference of consideration received on disposal and the share of net assets of the subsidiarycontinuously calculated from acquisition date is recognized as other comprehensive income. Whenlosing control, the cumulated other comprehensive income is transferred to profit or loss of theperiod of losing control. If the transactions of disposal of equity investments in a subsidiary are notassessed as a package deal, these transactions are accounted for as unrelated transactions.
8. Joint arrangements
There are two types of joint arrangements - joint operations and joint ventures. The classification isbased on the rights and obligations of the parties under the joint venture arrangement, taking intoaccount factors such as the structure, legal form and contractual terms of the arrangement. A jointoperation is a joint arrangement whereby the parties that have joint control of the arrangement haverights to the assets, and obligations for the liabilities, relating to the arrangement. A joint venture isa joint arrangement whereby the parties that have joint control of the arrangement have rights to thenet assets of the arrangement.
The Group accounts for investments in joint ventures using equity method. Refer to Note (IV),
15.3.2 "Long-term equity investments accounted for using the equity method" for details.
When a group entity undertakes its activities under joint operations, the Group as a joint operatorrecognizes in relation to its interest in a joint operation: - its assets, including its share of any assetsheld jointly; its liabilities, including its share of any liabilities incurred jointly; its revenue from thesale of its share of the output arising from the joint operation; its share of the revenue from the saleof the output by the joint operation; and its expenses, including its share of any expenses incurredjointly. The Group accounts for the assets, liabilities, revenues and expenses relating to its interestin a joint operation in accordance with the accounting standards applicable to the particular assets,liabilities, revenues and expenses.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
9. Cash and cash equivalents
Cash comprises cash on hand and deposits that can be readily withdrawn on demand. Cashequivalents are the Group's short-term (generally due within 3 months since the acquisition date),highly liquid investments that are readily convertible to known amounts of cash and which aresubject to an insignificant risk of changes in value.
10. Transactions denominated in foreign currencies and translation of financial
statements denominated in foreign currencies
10.1 Transactions denominated in foreign currencies
A foreign currency transaction is recorded, on initial recognition, by applying the spot exchangerate on the date of the transaction.
At the balance sheet date, foreign currency monetary items are translated into functional currencyusing the spot exchange rates at the balance sheet date. Exchange differences arising from thedifferences between the spot exchange rates prevailing at the balance sheet date and those on initialrecognition or at the previous balance sheet date are recognized in profit or loss for the period,except that (1) exchange differences related to a specific-purpose borrowing denominated in foreigncurrency that qualify for capitalization are capitalized as part of the cost of the qualifying assetduring the capitalization period; (2) exchange differences related to hedging instruments for thepurpose of hedging against foreign currency risks are accounted for using hedge accounting; (3)exchange differences arising from changes in the carrying amounts (other than the amortized cost)of monetary items at fair value through other comprehensive income are recognized as othercomprehensive income.
When the consolidated financial statements include foreign operation(s), if there is foreign currencymonetary item constituting a net investment in a foreign operation, exchange differences arisingfrom changes in exchange rates are recognized as "exchange differences arising from translation offinancial statements denominated in foreign currencies" in other comprehensive income, and inprofit or loss for the period upon disposal of the foreign operation.
Foreign currency non-monetary items measured at historical cost are translated to the amounts infunctional currency at the spot exchange rates on the dates of the transactions; the amounts infunctional currency remain unchanged. Foreign currency non-monetary items measured at fairvalue are re-translated at the spot exchange rate on the date when the fair value is determined.Difference between the re-translated functional currency amount and the original functionalcurrency amount is treated as changes in fair value (including changes in exchange rate) and isrecognized in profit or loss or as other comprehensive income.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Transactions denominated in foreign currencies and translation of financial
statements denominated in foreign currencies - continued
10.2 Translation of financial statements denominated in foreign currencies
For the purpose of preparing the consolidated financial statements, financial statements of a foreignoperation are translated from the foreign currency into RMB using the following method: assetsand liabilities on the balance sheet are translated at the spot exchange rate prevailing at the balancesheet date; shareholders' equity items except for unappropriated profit are translated at the spotexchange rates at the dates on which such items arose; all items in the income statement as well asitems reflecting the distribution of profits are translated at the average exchange rates of theaccounting period of the consolidated financial statements; the opening balance of unappropriatedprofit is the translated closing balance of the previous year's unappropriated profit; the closingbalance of unappropriated profit is calculated and presented on the basis of each translated incomestatement and profit distribution item. The difference between the translated assets and theaggregate of liabilities and shareholders' equity items is recognized as other comprehensive incomeand included in shareholders' equity.
Cash flows arising from a transaction in foreign currency and the cash flows of a foreign subsidiaryare translated at average exchange rate during the accounting period of consolidated financialstatements. The effect of exchange rate changes on cash and cash equivalents is regarded as areconciling item and presented separately in the cash flow statement as "effect of exchange ratechanges on cash and cash equivalents".
The closing balances and the comparative figures of previous year are presented at the translatedamounts in the previous year's financial statements.
On disposal of the Group's entire interest in a foreign operation, or upon a loss of control over aforeign operation due to disposal of certain interest in it or other reasons, the Group transfers theaccumulated exchange differences arising from translation of financial statements of this foreignoperation attributable to the owners' equity of the Company and presented under othercomprehensive income, to profit or loss in the period in which the disposal occurs.
In case of a disposal of part equity investments or other reason leading to lower interest percentagein foreign operations but does not result in the Group losing control over a foreign operation, theexchange differences arising from the translation of foreign currency statements related to thisdisposed part are re-attributed to minority interests and are not recognized in profit or loss. Forpartial disposals of equity interests in foreign operations which are associates or joint ventures, theproportionate share of the accumulated exchange differences arising from translation of statementsof foreign operations is reclassified to profit or loss.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
11. Financial instruments
The Group recognizes a financial asset or a financial liability when it becomes a party to thecontractual provisions of the financial instrument.
For financial assets purchased or sold in regular ways, assets to be received and liabilities to beassumed are recognized on the transaction date or assets sold are derecognized on that date.
Financial assets and financial liabilities are initially measured at fair value (the method fordetermining the fair values of the financial assets and financial liabilities is set out in relateddisclosures under "basis of accounting and principle of measurement" in note(IV) 5). For financialassets and financial liabilities at fair value through profit or loss, transaction costs are immediatelyrecognized in profit or loss. For other financial assets and financial liabilities, transaction costs areincluded in their initial recognized amounts. Upon initial recognition of contract assets, notesreceivable and accounts receivable that do not contain significant financing component or withoutconsidering the financing component included in the contract with a term not exceeding one yearunder the Accounting Standards for Business Enterprises No. 14 - Revenue ("Revenue Standards"),the Group adopts the transaction price as defined in the Revenue Standards for initial measurement.
The effective interest method is a method of calculating the amortized cost of a financial asset or afinancial liability and of allocating the interest income or interest expenses over the relevantaccounting periods.
The effective interest rate is the rate that exactly discounts estimated future cash flows through theexpected life of the financial asset or financial liability to the gross carrying amount of the financialasset or to the amortized cost of the financial liability. When calculating the effective interest rate,the Group estimates future cash flows considering all contractual terms of the financial asset orfinancial liability (such as repayment in advance, extension, call option or other similar options etc.)(without considering the expected credit losses).
The amortized cost of a financial asset or a financial liability is the amount of a financial asset or afinancial liability initially recognized net of principal repaid, plus or less the cumulative amortizedamount arising from amortization of the difference between the amount initially recognized and theamount at the maturity date using the effective interest method, net of cumulative credit lossallowance (only applicable to financial assets).
11.1 Classification, recognition and measurement of financial assets
Subsequent to initial recognition, the Group's financial assets of various categories are subsequentlymeasured at amortized cost, at fair value through other comprehensive income or at fair valuethrough profit or loss.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
11. Financial instruments - continued
11.1 Classification, recognition and measurement of financial assets - continued
If the contractual terms of the financial asset give rise on specified dates to cash flows that are solelypayments of principal and interest on the principal amount outstanding, and the financial asset isheld within a business model whose objective is achieved by collecting contractual cash flows, theGroup classifies such financial asset as financial assets at amortized cost, which include cash andbank balances, notes receivable, accounts receivable, other receivables, debt investments, and long-term receivables etc.
If the contractual terms of the financial asset give rise on specified dates to cash flows that are solelypayments of principal and interest on the principal amount outstanding, and the financial asset isheld within a business model whose objective is achieved by both collecting contractual cash flowsand selling the financial asset, the Group classifies such financial asset as financial assets atFVTOCI. The accounts receivable and notes receivable classified as at FVTOCI upon acquisitionare presented under receivables financing, while the remaining items due within one year (inclusive)upon acquisition are presented under other current assets. Other financial assets of such type arepresented as other debt investments if they are due after one year since the acquisition, or presentedunder non-current assets due within one year if they are due within one year (inclusive) since thebalance sheet date.
On initial recognition, the Group may irrevocably designate non-trading equity instruments, otherthan contingent consideration recognized through business combination not involving enterprisesunder common control, as financial assets at FVTOCI on an individual basis. Such financial assetsat FVTOCI are presented as investments in other equity instruments.
A financial asset is classified as held for trading if one of the following conditions is satisfied:
? It has been acquired principally for the purpose of selling in the near term; or? On initial recognition, it is part of a portfolio of identified financial instruments that the Group
manages together and there is objective evidence that the Group has a recent actual pattern ofshort-term profit-taking; or? It is a derivative that is not a financial guarantee contract or designated and effective as ahedging instrument.
Financial assets measured at fair value through profit or loss ("FVTPL") include those classified asfinancial assets at FVTPL and those designated as financial assets at FVTPL.
? Financial assets not satisfying the criteria of classification as financial assets at amortized costand financial assets at FVTOCI are classified as financial assets at FVTPL.? Upon initial recognition, the Group may irrevocably designate the financial assets as at
FVTPL if doing so eliminates or significantly reduces accounting mismatch.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
11. Financial instruments - continued
11.1 Classification, recognition and measurement of financial assets - continued
Financial assets at FVTPL other than derivative financial assets are presented as financial assetsheld-for-trading. Financial assets with a maturity over one year since the balance sheet date (orwithout a fixed maturity) and expected to be held for over one year are presented under other non-current financial assets.
11.1.1 Financial assets measured at amortized cost
Financial assets measured at amortized cost are subsequently measured at amortized cost using theeffective interest method. Gain or loss arising from impairment or derecognition is recognized inprofit or loss.
For financial assets measured at amortized cost, the Group recognizes interest income usingeffective interest method. The Group calculates and recognizes interest income through grosscarrying amount of financial assets multiplying effective interest rate, except for the followingcircumstances:
? For purchased or originated credit-impaired financial assets, the Group calculates and
recognizes the interest income based on amortized cost of the financial asset and the effectiveinterest rate through credit adjustment since initial recognition.
11.1.2 Financial assets at FVTOCI
For financial assets classified as at FVTOCI, except for the impairment losses or gains and theinterest income and exchange losses or gains calculated using the effective interest method whichare included in profit or loss for the period, the changes in fair value are included in othercomprehensive income. The amounts included in profit or loss for each period are equivalent to thatas if the financial assets have been always measured at amortized cost. Upon derecognition, theaccumulated gains or losses previously included in other comprehensive income are transferred toprofit or loss for the period.
Changes in fair value of non-trading equity instrument investments designated as financial assets atFVTOCI are recognized in other comprehensive income, and the cumulative gains or lossespreviously recognized in other comprehensive income allocated to the part derecognized aretransferred and included in retained earnings. During the period in which the Group holds the non-trading equity instruments, revenue from dividends is recognized in profit or loss for the currentperiod when (1) the Group has established the right of collecting dividends; (2) it is probable thatthe associated economic benefits will flow to the Group; and (3) the amount of dividends can bemeasured reliably.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
11. Financial instruments - continued
11.1 Classification, recognition and measurement of financial assets - continued
11.1.3 Financial assets at FVTPL
Financial assets at FVTPL are subsequently measured at fair value. Gain or loss arising fromchanges in fair value and dividends and interest related to the financial assets are recognized inprofit or loss.
11.2 Impairment of financial instruments
For financial assets at amortized cost, financial assets classified as at FVTOCI, lease receivables,contract assets, loan commitments that are not financial liabilities at FVTPL, financial liabilitiesthat are not at FVTPL and financial guarantee contracts that are not qualified for derecognition dueto the transfer of financial assets or financial liabilities arising from continuing involvement of thetransferred financial assets, the Group accounts for the impairment and recognizes the provision forlosses on the basis of expected credit loss ("ECL").
For all contract assets, notes receivable and accounts receivable arising from transactions regulatedby Revenue Standards, and lease receivables arising from transactions regulated by the AccountingStandards for Business Enterprises No. 21 - Leases, the Group recognizes the provision for lossesat an amount equivalent to lifetime ECL.
For other financial instruments (other than purchased or originated credit-impaired financial assets),the Group assesses the changes in credit risk since initial recognition of relevant financialinstruments at each balance sheet date. If the credit risk has increased significantly since initialrecognition of the financial instruments, the Group recognizes the provision for losses at an amountequivalent to lifetime ECL; if the credit risk has not increased significantly since initial recognitionof the financial instruments, the Group recognizes the provision for losses at an amount equivalentto 12-month ECL. The increase or reversal of credit loss provision for financial assets other thanthose classified as at FVTOCI is recognized as impairment loss or gain and included in profit orloss for the period. For financial assets classified as at FVTOCI, the credit loss provision isrecognized in other comprehensive income and the impairment loss or gain is included in profit orloss for the period without reducing the carrying amount of the financial assets in the balance sheet.
Where the Group has measured the provision for losses at an amount equivalent to lifetime ECL ofa financial instrument in prior accounting period, but the financial instrument no longer satisfies thecriteria of significant increase in credit risk since initial recognition at the current balance sheet date,the Group recognizes the provision for losses of the financial instrument at an amount equivalentto 12-month ECL at the current balance sheet date, with any resulting reversal of provision forlosses recognized as impairment gains in profit or loss for the period.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
11. Financial instruments - continued
11.2 Impairment of financial instruments - continued
11.2.1 Significant increase of credit risk
The Group uses reasonable and supportable forward-looking information to assess whether thecredit risk has increased significantly since initial recognition by comparing the risk of a defaultoccurring on the financial instrument at the balance sheet date with the risk of a default occurringon the financial instrument at the date of initial recognition. For loan commitments and financialguarantee contracts, the date on which the Group becomes a party to the irrevocable commitmentis considered to be the date of initial recognition in the application of criteria related to the financialinstrument for impairment.
In particular, the following information is taken into account when assessing whether credit risk hasincreased significantly:
(1) Significant changes in internal price indicators resulting from changes in credit risk;
(2) Significant changes in the rates or other terms of an existing financial instrument if the
instrument was newly originated or issued at the balance sheet date (such as more stringentcovenants, increased amounts of collateral or guarantees, or higher rate of return, etc.);
(3) Significant changes in the external market indicators of credit risk of the same financial
instrument or similar financial instruments with the same expected duration. Theseindicators include: credit spreads, credit default swap prices against borrower, length of timeand extent to which the fair value of financial assets is less than their amortized cost, andother market information related to the borrower (such as the borrower's debt instrumentsor changes in the price of equity instruments);
(4) An actual or expected significant change in the financial instrument's external credit rating;
(5) An actual or expected decrease in the internal credit rating for the debtor;
(6) Adverse changes in business, financial or economic conditions that are expected to cause a
significant decrease in the debtor's ability to meet its debt obligations;
(7) An actual or expected significant change in the operating results of the debtor;
(8) Significant increase in credit risk of other financial instruments issued by the same debtor;
(9) Significant adverse changes in the regulatory, economic, or technological environment of
the debtor;
(10) Significant changes in the value of the collaterals or the quality of guarantees or credit
enhancements provided by third parties, which are expected to reduce the debtor's economicmotives to repay within the time limit specified in contract or affect the probability of default;
(11) Significant change in the debtor's economic motives to repay within the time limit specified
in contract;
(12) Expected changes to loan contract, including the exemption or revision of contractual
obligations, the granting of interest-free periods, the jump in interest rates, the requirementfor additional collateral or guarantees, or other changes in the contractual framework forfinancial instruments that may result from the breach of contract;
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
11. Financial instruments - continued
11.2 Impairment of financial instruments - continued
11.2.1 Significant increase of credit risk - continued
(13) Significant change in the expected performance and repayment of the debtor;
(14) Significant change in the method used by the Group to manage the credit of financial
instruments.
The Group assumes that the credit risk on a financial instrument has not increased significantlysince initial recognition if the financial instrument is determined to have lower credit risk at thebalance sheet date. A financial instrument is determined to have lower credit risk if: i) it has a lowerrisk of default, ii) the borrower has a strong capacity to meet its contractual cash flow obligationsin the near term and iii) adverse changes in economic and business conditions in the longer termmay, but will not necessarily, reduce the ability of the borrower to fulfil its contractual cash flowobligations.
11.2.2 Credit-impaired financial assets
When an event or several events that are expected to have adverse impact on the future cash flowsof the financial assets have occurred, the financial assets become credit-impaired. The evidences ofcredit impairment of financial assets include the following observable information:
(1) Significant financial difficulty of the issuer or debtor.
(2) A breach of contract by the debtor, such as a default or delinquency in interest or principal
payments.
(3) The creditor, for economic or legal reasons relating to the debtor's financial difficulty,
granting a concession to the debtor.
(4) It becomes probable that the debtor will enter bankruptcy or other financial reorganizations.
(5) The disappearance of an active market for the financial asset because of financial difficulties
of the issuer or the debtor.
(6) Purchase or origination of a financial asset with a large scale of discount, which reflects the
fact of credit loss.
Based on the Group's internal credit risk management, the Group considers an event of defaultoccurs when information developed internally or obtained from external sources indicates that thedebtor is unlikely to pay its creditors, including the Group, in full (without taking into account anycollaterals held by the Group).
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
11. Financial instruments - continued
11.2 Impairment of financial instruments - continued
11.2.3 Determination of expected credit loss
The Group determines the ECL of relevant financial instruments using the following methods:
? For financial assets, the credit loss is the present value of the difference between thecontractual cash flows that are due to the Group under the contract and the cash flows that theGroup expects to receive;? For undrawn loan commitments (refer to Note IV, 11.4.1.3 for the detail of accountingpolicies), the credit loss is the present value of the difference between the contractual cashflows that are due to the Group if the holder of the loan commitments draws down the loan,and the cash flows that the Group expects to receive if the loan is drawn down. The Group'sestimation of the ECL for loan commitments is consistent with its expectation of the loancommitments drawn down.? For financial guarantee contracts (refer to Note IV, 11.4.1.3 for the detail of accountingpolicies), the credit loss is the present value of the expected payments to reimburse the holderfor the credit loss incurred less any amounts that the Group expects to receive from the holder,the debtor or any other party.? For financial assets credit-impaired at the balance sheet date, but not purchased or originatedcredit-impaired, the credit loss is the difference between the gross carrying amount of thefinancial assets and the present value of estimated future cash flows discounted at the originaleffective interest rate.
The factors reflected by the Group's measurement of ECL of financial instruments include: unbiasedprobability weighted average amount recognized by assessing a series of possible results; time valueof money; reasonable and supportable information related to historical events, current conditionand forecast of future economic position that is available without undue cost or effort at the balancesheet date.
11.2.4 Write-down of financial assets
When the Group no longer reasonably expects that the contractual cash flows of financial assetscan be collected in aggregate or in part, the Group will directly write down the gross carryingamount of the financial assets, which constitutes derecognition of relevant financial assets.
11.3 Transfer of financial assets
The Group will derecognize a financial asset if one of the following conditions is satisfied: (i) thecontractual rights to the cash flows from the financial asset expire; (ii) the financial asset has beentransferred and substantially all the risks and rewards of ownership of the financial asset istransferred to the transferee; or (iii) although the financial asset has been transferred, the Groupneither transfers nor retains substantially all the risks and rewards of ownership of the financialasset but has not retained control of the financial asset.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
11. Financial instruments - continued
11.3 Transfer of financial assets - continued
If the Group neither transfers nor retains substantially all the risks and rewards of ownership of afinancial asset, and it retains control of the financial asset, the Group will recognize the financialasset to the extent of its continuing involvement in the transferred financial asset and recognize anassociated liability. The Group will measure relevant liabilities as follows:
? For transferred financial assets carried at amortized cost, the carrying amount of relevant
liabilities is the carrying amount of financial assets transferred with continuing involvementless amortized cost of the Group's retained rights (if the Group retains relevant rights upontransfer of financial assets) with addition of amortized cost of obligations assumed by theGroup (if the Group assumes relevant obligations upon transfer of financial assets). Relevantliabilities are not designated as financial liabilities at fair value through profit or loss.? For transferred financial assets carried at fair value, the carrying amount of relevant liabilitiesis the carrying amount of financial assets transferred with continuing involvement less fairvalue of the Group's retained rights (if the Group retains relevant rights upon transfer offinancial assets) with addition of fair value of obligations assumed by the Group (if the Groupassumes relevant obligations upon transfer of financial assets). Accordingly, the fair value ofrelevant rights and obligations shall be measured on an individual basis.
For the transfer of a financial asset in its entirety that satisfies the derecognition criteria, thedifference between (1) the carrying amount of the financial asset transferred and (2) the sum of theconsideration received from the transfer and any cumulative gain or loss that has been recognizedin other comprehensive income, is recognized in profit or loss. Where the transferred assets are non-trading equity instrument investments designated as at FVTOCI, cumulative gains or lossespreviously recognized in other comprehensive income are transferred out and included in retainedearnings.
If a part of the transferred financial asset qualifies for derecognition, the overall carrying amount ofthe financial asset prior to transfer is allocated between the part that continues to be recognized andthe part that is derecognized, based on the respective fair value of those parts at the date of transfer.The difference between (1) the carrying amount allocated to the part derecognized on the date ofderecognition; and (2) the sum of the consideration received for the part derecognized and anycumulative gain or loss allocated to the part derecognized which has been previously recognized inother comprehensive income, is recognized in profit or loss. Where the transferred assets are non-trading equity instrument investments designated as at FVTOCI, cumulative gains or lossespreviously recognized in other comprehensive income are transferred out and included in retainedearnings.
For a transfer of a financial asset in its entirety that does not satisfy the derecognition criteria, theGroup continues to recognize the transferred financial asset in its entirety. The considerationreceived from transfer of assets is recognized as a liability upon receipt.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
11. Financial instruments - continued
11.4 Classification of financial liabilities and equity instruments
Financial instruments issued by the Group or their components are classified into financial liabilitiesor equity instruments on the basis of the substance of the contractual arrangements and the economicnature not only the legal form, together with the definition of financial liability and equityinstrument on initial recognition.
11.4.1 Classification, recognition and measurement of financial liabilities
On initial recognition, financial liabilities are classified into financial liabilities at FVTPL and otherfinancial liabilities.
11.4.1.1 Financial liabilities at FVTPL
Financial liabilities at FVTPL consist of financial liabilities held for trading (including derivativesclassified as financial liabilities) and those designated as at FVTPL. Except for derivative financialliabilities presented separately, the financial liabilities at FVTPL are presented as held-for-tradingfinancial liabilities.
A financial liability is classified as held for trading if one of the following conditions is satisfied:
? It has been acquired principally for the purpose of repurchasing in the near term; or? On initial recognition, it is part of a portfolio of identified financial instruments that the Groupmanages together and there is objective evidence that the Group has a recent actual pattern ofshort-term profit-taking; or? It is a derivative that is not a financial guarantee contract or designated and effective as ahedging instrument.
A financial liability may be designated as at FVTPL on initial recognition when one of the followingconditions is satisfied: (i) Such designation eliminates or significantly reduces accounting mismatch;or (ii) The Group makes management and performance evaluation on a fair value basis, inaccordance with the Group's formally documented risk management or investment strategy, andreports to key management personnel on that basis. (iii) The qualified hybrid financial instrumentcombines financial asset with embedded derivatives.
Held-for-trading financial liabilities are subsequently measured at fair value. Any gains or lossesarising from changes in fair value and any dividends or interest expenses paid on the financialliabilities are recognized in profit or loss.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
11. Financial instruments - continued
11.4 Classification of financial liabilities and equity instruments - continued
11.4.1 Classification, recognition and measurement of financial liabilities - continued
11.4.1.1 Financial liabilities at FVTPL - continued
For a financial liability designated as at FVTPL, the amount of changes in fair value of the financialliability that are attributable to changes in the credit risk of that liability shall be presented in othercomprehensive income, while other changes in fair value are included in profit or loss for the currentperiod. Upon the derecognition of such financial liability, the accumulated amount of changes infair value that are attributable to changes in the credit risk of that liability, which was recognized inother comprehensive income, is transferred to retained earnings. Any dividend or interest expenseon the financial liabilities is recognized in profit or loss. If the accounting treatment for the impactof the change in credit risk of such financial liability in the above ways would create or enlarge anaccounting mismatch in profit or loss, the Group shall present all gains or losses on that liability(including the effects of changes in the credit risk of that liability) in profit or loss for the period.
For financial liabilities arising from contingent consideration recognized by the Group as theacquirer in the business combination not involving enterprises under common control, the Groupmeasures such financial liabilities at fair value through profit or loss, and includes the changes inthe financial liabilities in profit or loss for the period.
11.4.1.2 Other financial liabilities
Except for financial liabilities, financial guarantee contracts and loan commitments arising fromtransfer of financial assets that do not meet the derecognition criteria or those arising fromcontinuing involvement in the transferred financial assets, other financial liabilities aresubsequently measured at amortized cost, with gain or loss arising from derecognition oramortization recognized in profit or loss.
If the modification or renegotiation for the contract by the Group and its counterparties does notresult in derecognition of a financial liability subsequently measured at amortized cost but thechanges in contractual cash flows, the Group will recalculate the carrying amount of the financialliability, with relevant gain or loss recognized in profit or loss. The Group will determine thecarrying amount of the financial liability based on the present value of renegotiated or modifiedcontractual cash flows discounted at the original effective interest rate of the financial liability. Forall costs or expenses arising from modification or renegotiation of the contract, the Group will adjustthe modified carrying amount of the financial liability and make amortization during the remainingterm of the modified financial liability.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
11. Financial instruments - continued
11.4 Classification of financial liabilities and equity instruments - continued
11.4.1 Classification, recognition and measurement of financial liabilities - continued
11.4.1.3 Financial guarantee contracts and loan commitments
A financial guarantee contract is a contract that requires the issuer to make specified payments toreimburse the holder of the contract for a loss it incurs because a specified debtor fails to makepayment when due in accordance with the original or modified terms of a debt instrument.Subsequent to initial recognition, financial guarantee contracts that are not designated as financialliabilities at fair value through profit or loss or financial liabilities arising from transfer of financialassets that do not meet the derecognition criteria or those arising from continuing involvement inthe transferred financial assets, and loan commitments to provide a loan at a below-market interestrate, which are not designated at fair value through profit or loss, are measured at the higher of: (1)amount of loss provision; and (2) the amount initially recognized less cumulative amortizationamount determined based on the revenue standards.
11.4.2 Derecognition of financial liabilities
The Group derecognizes a financial liability (or part of it) when the underlying present obligation(or part of it) is discharged. An agreement between the Group (the debtor) and the creditor to replacethe original financial liability with a new financial liability with substantially different terms isaccounted for as an extinguishment of the original financial liability and the recognition of a newfinancial liability.
When the Group derecognizes a financial liability or a part of it, it recognizes the difference betweenthe carrying amount of the financial liability (or part of the financial liability) derecognized and theconsideration paid (including any non-cash assets transferred or new financial liabilities assumed)in profit or loss.
11.4.3 Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of the Groupafter deducting all of its liabilities. Equity instruments issued (including refinanced), repurchased,sold and cancelled by the Group are recognized as changes in equity. Changes in fair value of equityinstruments are not recognized by the Group. Transaction costs related to equity transactions arededucted from equity.
The Group recognizes the distribution to holders of the equity instruments as distribution of profits,and dividends paid do not affect total amount of shareholders' equity.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
11. Financial instruments - continued
11.5 Derivatives and embedded derivatives
Derivatives include forward exchange contracts, currency swaps, interest rate swaps and foreignexchange options, etc. Derivatives are initially measured at fair value at the date when the derivativecontracts are entered into and are subsequently measured at fair value.
Derivatives embedded in hybrid contracts with a financial asset host are not separated by the Group.The hybrid contract shall apply the relevant accounting standards regarding the classification offinancial assets as a whole.
Derivatives embedded in hybrid contracts with hosts that are not financial assets are separated andtreated as separate derivatives by the Group when they meet the following conditions:
(1) the economic characteristics and risks of the embedded derivative are not closely related to
those of the host contract;
(2) a separate instrument with the same terms as the embedded derivative would meet the
definition of a derivative;
(3) the hybrid contracts are not measured at fair value through profit or loss.
For the embedded derivative separated from the host contracts, the Group accounts for the hostcontracts in the hybrid contracts with applicable accounting standards. When the embeddedderivatives whose fair value cannot be measured reliably by the Group according to the terms andconditions of the embedded derivatives, the fair value of such derivatives are measured at thedifference between the fair value of the hybrid contracts and the fair value of the host contracts. Byadopting the above method, if the embedded derivative cannot be measured on a stand-alone basisat the time when it is acquired or at subsequent balance sheet dates, the hybrid instrument isdesignated as financial instruments at fair value through profit or loss as a whole.
11.6 Offsetting financial assets and financial liabilities
Where the Group has a legal right that is currently enforceable to set off the recognized financialassets and financial liabilities, and intends either to settle on a net basis, or to realize the financialasset and settle the financial liability simultaneously, a financial asset and a financial liability shallbe offset and the net amount is presented in the balance sheet. Except for the above circumstances,financial assets and financial liabilities shall be presented separately in the balance sheet and shallnot be offset.
11.7 Compound instruments
For convertible bonds issued by the Group that contain both liabilities and conversion option thatmay convert the liabilities to its own equity instrument, upon initial recognition, the bonds are splitinto liabilities and conversion option which are separately recognized. Therein, the conversionoption that exchanges a fixed amount of cash or other financial assets for a fixed amount of equityinstruments is accounted for as an equity instrument.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
11. Financial instruments - continued
11.7 Compound instruments - continued
Upon initial recognition, the fair value of liability portion is determined based on the prevailingmarket price of the bonds containing no conversion option. The overall issue price of the convertiblebonds net of the fair value of the liability portion is considered as the value of the conversion optionthat enables the bonds holder to convert the bonds to equity instruments, and is included in otherequity instruments.
The liability portion of the convertible bonds is subsequently measured at amortized cost usingeffective interest method; the value of the conversion option classified as equity instrument isremained in equity instrument. The expiry or conversion of convertible bonds will not result in lossor gain.
The transaction costs incurred for issuance of the convertible bonds are allocated between theliability portion and equity instrument portion in proportion to their respective fair values. Thetransaction cost relating to the equity instrument portion is directly included in equity instrument;while the transaction cost relating to the liability portion is included in the carrying amount of theliability, and amortized over the lifetime of the convertible bonds using effective interest method.
11.8 Reclassification of financial instruments
When the Group changes the business model to manage the financial assets, the financial assetsaffected will be reclassified and no financial liabilities will be reclassified.
The financial assets are reclassified by the Group and are accounted for prospectively since the dateof reclassification (i.e., the first date of the initial reporting period after the business model of whichthe financial assets are reclassified by the enterprise is changed).
Where a financial asset at amortized cost is reclassified as a financial asset at fair value throughprofit or loss ("FVTPL") by the Group, such financial asset is measured at fair value at the date ofreclassification and the difference between the original carrying amount and the fair value isrecognized in profit or loss for the period.
Where a financial asset at amortized cost is reclassified as a financial asset at fair value throughother comprehensive income ("FVTOCI") by the Group, such financial asset is measured at fairvalue at the date of reclassification, and the difference between the original carrying amount andthe fair value is recognized in other comprehensive income.
Where a financial asset at FVTOCI is reclassified as a financial asset at amortized cost by the Group,the accumulated gains or losses previously recognized in other comprehensive income aretransferred out and the fair value at the date of reclassification is adjusted. The adjusted fair valueis determined as the new carrying amount, as if the financial asset has been always measured atamortized cost. The reclassification of the financial asset shall not affect its effective interest rateor the measurement of ECL.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
11. Financial instruments - continued
11.8 Reclassification of financial instruments - continued
Where a financial asset at FVTOCI is reclassified as a financial asset at FVTPL by the Group, suchfinancial asset continues to be measured at fair value. At the same time, the accumulated gains orlosses previously recognized in other comprehensive income are transferred to profit or loss for theperiod.
Where a financial asset at FVTPL is reclassified as a financial asset at amortized cost by the Group,the fair value at the date of reclassification is determined as the new gross carrying amount.
Where a financial asset at FVTPL is reclassified as a financial asset at FVTOCI by the Group, suchfinancial asset continues to be measured at fair value.
Where a financial asset at FVTPL is reclassified, the effective interest rate is determined on thebasis of the fair value of the financial asset at the date of reclassification.
12. Receivables
12.1 Determination and accounting methods for expected credit losses of receivables
The Group assesses the credit risk of receivables with significantly different credit risks on anindividual basis, and determine the credit losses of receivables on a portfolio basis using animpairment matrix for other receivables. The amount of increase in or reversal of allowance forexpected credit losses on receivables is included in profit or loss for the period as credit impairmentlosses or gains.
12.2 Categories of portfolios for which bad debt provision is assessed on a portfolio basis
according to credit risk characteristics and the basis for determination
The Group classifies receivables into groups A, B and C based on common risk characteristics. Thecommon credit risk characteristics adopted by the Group include: type of financial instrument,credit risk rating, type of collateral, initial recognition date, remaining contractual term, industry ofthe debtor, geographical location of the debtor, value of the collateral to the financial asset, etc.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
12. Receivables - continued
12.2 Categories of portfolios for which bad debt provision is assessed on a portfolio basis
according to credit risk characteristics and the basis for determination - continued
The Group makes internal credit ratings on customers and determines expected loss rate ofreceivables. Basis for determining ratings and the expected loss rates are as follows:
CHINA MERCHANTS PORT GROUP CO., LTD.Internal creditrating
| Internal credit rating | Basis for determining portfolio | Expected average loss rate (%) |
| A | Customers can make repayments within credit term and have good credit records based on historical experience. The probability of default on payment of due amounts is extremely low in the foreseeable future. | 0.00-0.10 |
| B | The customers may have overdue payment based on historical experience but they can make repayments. | 0.10-0.30 |
| C | The evidence indicates that the overdue credit risks of the customers are significantly increased and there is probability of default on payment. | 0.30-50.00 |
12.3 Determination criteria for provision of bad debts on an individual basis
| Internal credit ratings | Basis to determine the provision for bad debts on an individual basis | Expected average loss ratio (%) |
| D | There is evidence showing that the receivables from customers are impaired, or that the customers are experiencing significant financial difficulties and thus the receivables will be irrecoverable in the foreseeable future. | 50.00-100.00 |
13. Receivables financing
Notes receivable classified as at FVTOCI should be listed as receivables financing within one year(including one year) from the date of acquisition. Those over one year should be listed as other debtinvestments. For related accounting policies, refer to Note (IV) 11 and Note (IV) 12.
14. Inventories
14.1 Categories of inventories, valuation method of inventories upon delivery, inventory count
system, and amortization method for ow cost and short-lived consumable items andpackaging materials
14.1.1 Categories of inventories
The Group's inventories mainly include raw materials, merchandise and others. Inventories areinitially measured at cost. Cost of inventories comprises all costs of purchase, costs of conversionand other expenditures incurred in bringing the inventories to their present location and condition.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
14. Inventories - continued
14.1 Categories of inventories, valuation method of inventories upon delivery, inventory count
system, and amortization method for ow cost and short-lived consumable items andpackaging materials - continued
14.1.2 Valuation method of inventories upon delivery
The actual cost of inventories upon delivery is calculated using the weighted average method andfirst-in-first-out method.
14.1.3 Inventory count system
The perpetual inventory system is maintained for stock system.
14.1.4 Amortization method for low cost and short-lived consumable items and packaging
materials
Packaging materials and low cost and short-lived consumable items are amortized using theimmediate write-off method.
14.2 Recognition criteria and provision method for decline in value of inventories
At the balance sheet date, inventories are measured at the lower of cost and net realizable value. Ifthe cost of inventories is higher than the net realizable value, a provision for decline in value ofinventories is made.
Net realizable value is the estimated selling price in the ordinary course of business less theestimated costs of completion, the estimated costs necessary to make the sale and relevant taxes.Net realizable value is determined on the basis of clear evidence obtained, after taking intoconsideration the purposes of inventories being held and effect of post balance sheet events.
Provision for decline in value of inventories is made based on the excess of cost of inventory overits net realizable value on an item-by-item basis.
After the provision for decline in value of inventories is made, if the circumstances that previouslycaused inventories to be written down below cost no longer exist so that the net realizable value ofinventories is higher than their cost, the original provision for decline in value is reversed and thereversal is included in profit or loss for the period.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
15. Long-term equity investments
15.1 Basis for determining joint control and significant influence over investee
Control is archived when the Group has the power over the investee and has rights to variablereturns from its involvement with the investee; and has the ability to use its power to affect itsreturns. Joint control is the contractually agreed sharing of control over an economic activity, andexists only when the strategic financial and operating policy decisions relating to the activity requirethe unanimous consent of the parties sharing control. Significant influence is the power toparticipate in the financial and operating policy decisions of the investee but is not control or jointcontrol over those policies. When determining whether an investing enterprise is able to exercisecontrol or significant influence over an investee, the effect of potential voting rights of the investee(for example, warrants and convertible debts) held by the investing enterprises or other parties thatare currently exercisable or convertible shall be considered.
15.2 Determination of initial investment cost
For a long-term equity investment acquired through business combination involving enterprisesunder common control, share of carrying amount of owners' equity of the acquiree in theconsolidated financial statements of ultimate controlling party is recognized as initial investmentcost of long-term equity investment at the date of combination. The difference between initialinvestment cost of long-term equity investment and cash paid, non-cash assets transferred andcarrying amount of liabilities assumed, is adjusted in capital reserve. If the balance of capital reserveis not sufficient to absorb the difference, any excess is adjusted to retained earnings. If theconsideration of the combination is satisfied by the issue of equity securities, the initial investmentcost of the long-term equity investment is the share of carrying amount of owners' equity of theacquiree in the consolidated financial statements of ultimate controlling party at the date ofcombination. The aggregate face value of the shares issued is accounted for as share capital. Thedifference between the initial investment cost and the aggregate face value of the shares issued isadjusted to capital reserve. If the balance of capital reserve is not sufficient to absorb the difference,any excess is adjusted to retained earnings. Where equity interests in an acquiree are acquired instages through multiple transactions ultimately constituting a business combination involvingenterprises under common control, the acquirer shall determine if these transactions are consideredto be a "package deal". If yes, these transactions are accounted for as a single transaction wherecontrol is obtained. If no, the initial investment cost of the long-term equity investment is the shareof carrying amount of owners' equity of the acquiree in the consolidated financial statements ofultimate controlling party at the date of combination. The difference between the initial investmentcost and the sum of carrying amount of equity investments previously held in the acquiree and thenew investment cost is adjusted to capital reserve. If the balance of capital reserve is not sufficientto absorb the difference, any excess is adjusted to retained earnings. Other comprehensive incomerecognized for the previously held equity investments by accounting treatment of equity method ornon-trading equity instrument investments designated as at FVTOCI is not subject to accountingtreatment temporarily.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
15. Long-term equity investments - continued
15.2 Determination of initial investment cost - continued
For a long-term equity investment acquired through business combination not involving enterprisesunder common control, the investment cost of the long-term equity investment acquired is the costof acquisition.
The expenses incurred by the acquirer in respect of auditing, legal services, valuation andconsultancy services and other associated administrative expenses attributable to the businesscombination are recognized in profit or loss when they are incurred.
The long-term equity investment acquired otherwise than through a business combination is initiallymeasured at its cost. When the entity is able to exercise significant influence or joint control (butnot control) over an investee due to additional investment, the cost of long-term equity investmentsis the sum of the fair value of previously-held equity investments determined in accordance withAccounting Standards for Business Enterprises No.22 - Financial Instruments: Recognition andMeasurement (ASBE No. 22) and the additional investment cost.
15.3 Subsequent measurement and recognition of profit or loss
15.3.1 Long-term equity investments accounted for using the cost method
Long-term equity investments in subsidiaries are accounted for using the cost method in theCompany's separate financial statements. A subsidiary is an investee that is controlled by the Group.
Under the cost method, a long-term equity investment is measured at initial investment cost. Whenadditional investment is made or the investment is recouped, the cost of the long-term equityinvestment is adjusted accordingly. Investment income is recognized in the period in accordancewith the attributable share of cash dividends or profit distributions declared by the investee.
15.3.2 Long-term equity investments accounted for using the equity method
Except for investments in associates and joint ventures classified as held-for-sale partly or wholly,the Group accounts for investment in associates and joint ventures using the equity method. Anassociate is an entity over which the Group has significant influence and a joint venture is a jointarrangement whereby the Group only has rights to the net assets of the arrangement.
Under the equity method, where the initial investment cost of a long-term equity investment exceedsthe Group's share of the fair value of the investee's identifiable net assets at the time of acquisition,no adjustment is made to the initial investment cost. Where the initial investment cost is less thanthe Group's share of the fair value of the investee's identifiable net assets at the time of acquisition,the difference is recognized in profit or loss for the period, and the cost of the long-term equityinvestment is adjusted accordingly.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
15. Long-term equity investments - continued
15.3 Subsequent measurement and recognition of profit or loss - continued
15.3.2 Long-term equity investments accounted for using the equity method - continued
Under the equity method, the Group recognizes its share of the net profit or loss and othercomprehensive income of the investee for the period as investment income and othercomprehensive income for the period. Meanwhile, the carrying amount of long-term equityinvestment is adjusted; the carrying amount of long-term equity investment is decreased inaccordance with its share of the investee's declared profit or cash dividends; other changes inowners' equity of the investee other than net profit or loss and other comprehensive income arecorrespondingly adjusted to the carrying amount of the long-term equity investment, and recognizedin capital reserve. The Group recognizes its share of the investee's net profit or loss based on thefair value of the investee's individual identifiable assets, etc. at the acquisition date after makingappropriate adjustments. When the investee's accounting policies and accounting period areinconsistent with those of the Group, the Group recognizes investment income and othercomprehensive income after making appropriate adjustments to conform to the Group's accountingpolicies and accounting period. However, unrealized gains or losses resulting from the Group'stransactions with its associates and joint ventures, which do not constitute a business, are eliminatedbased on the proportion attributable to the Group and then investment gains or losses are recognized.However, unrealized losses resulting from the Group's transactions with its associates and jointventures which represent impairment losses on the transferred assets are not eliminated.
The Group discontinues recognizing its share of net losses of the investee after the carrying amountof the long-term equity investment together with any long-term interests that in substance form partof its net investment in the investee are reduced to zero. In addition, if the Group has incurredobligations to assume additional losses, a provision is recognized according to the obligationexpected, and recorded in the investment loss for the period. Where net profits are subsequentlymade by the investee, the Group resumes recognizing its share of those profits only after its shareof the profits exceeds the share of losses previously not recognized.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
15. Long-term equity investments - continued
15.4 Disposal of long-term equity investments
On disposal of a long-term equity investment, the difference between the proceeds actually receivedand receivable and the carrying amount is recognized in profit or loss for the period. For long-termequity investments accounted for using the equity method, if the remaining interest after disposalis still accounted for using the equity method, other comprehensive income previously recognizedusing the equity method is accounted for on the same basis as would have been required if theinvestee had directly disposed of related assets or liabilities, and transferred to profit or loss for theperiod on a pro rata basis; owners' equity recognized due to other changes in owners' equity of theinvestee (other than net profit or loss, other comprehensive income and profit distribution) istransferred to profit or loss for the period on a pro rata basis. For long-term equity investmentsaccounted for using the cost method, if the remaining interest after disposal is still accounted forusing the cost method, other comprehensive income previously recognized using the equity methodor in accordance with the standards for the recognition and measurement of financial instrumentsbefore obtaining the control over the investee, is accounted for on the same basis as would havebeen required if the investee had directly disposed of related assets or liabilities, and transferred toprofit or loss for the period on a pro rata basis; other changes in owners' equity in the investee's netassets recognized under the equity method (other than net profit or loss, other comprehensiveincome and profit distribution) is transferred to profit or loss for the period on a pro rata basis.
Where the Group loses control over the investee due to disposal of part of shares, and in preparingthe separate financial statements, remaining shares after disposal can have joint control orsignificant influence over the investee, the equity method shall be adopted to adjust the remainingshares as they are accounted for under equity method since the acquisition date. If remaining sharesafter disposal cannot have joint control or significant influence over the investee, they are accountedfor in accordance with the standards for recognition and measurement of financial instruments, andthe difference between fair value on date of losing control and carrying amount is recognized inprofit or loss for the period. Other comprehensive income recognized using the equity method or inaccordance with the standards for the recognition and measurement of financial instruments beforelosing control over the investee, is accounted for on the same basis as would have been required ifthe investee had directly disposed of related assets or liabilities when the control over the investeeis lost; other changes in owners' equity in the investee's net assets recognized under the equitymethod (other than net profit or loss, other comprehensive income and profit distribution) istransferred to profit or loss for the period on a pro rata basis. Where remaining shares after disposalare accounted for under equity method, other comprehensive income and other owners' equity aretransferred on a pro rata basis. Where remaining shares after disposal are accounted for inaccordance with the standards for recognition and measurement of financial instruments, othercomprehensive income and other owners' equity are all transferred.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
15. Long-term equity investments - continued
15.4 Disposal of long-term equity investments - continued
Where the Group loses joint control or significant influence over the investee after part disposal ofshares, remaining shares after disposal are accounted for in accordance with the standards forrecognition and measurement of financial instruments, and the difference between fair value at thedate of losing joint control or significant influence and carrying amount is recognized in profit orloss for the period. Other comprehensive income previously recognized under the equity method,is accounted for on the same basis as would have been required if the investee had directly disposedof related assets or liabilities when the equity method is not adopted, and other changes in owners'equity other than net profit or loss, other comprehensive income and profit distribution aretransferred to investment income for the period when the equity method is not adopted.
The Group disposes of its equity investment in subsidiaries through multiple transactions step bystep until it loses control over the subsidiaries. If these transactions belong to "package deal", alltransactions are deemed as one transaction on disposal of equity investment in subsidiaries, and thedifference between the amount of disposal and carrying amount of long-term equity investment isrecognized as other comprehensive income, and transferred to profit or loss for the period when thecontrol is lost.
16. Investment properties
Investment property is the property held by the Group to earn rentals or for capital appreciation orboth. It includes a land use right that is leased out and a building that is leased out.
An investment property is measured initially at cost. Subsequent expenditures incurred for suchinvestment property are included in the cost of the investment property if it is probable thateconomic benefits associated with the investment property will flow to the Group and thesubsequent expenditures can be measured reliably. Other subsequent expenditures are recognizedin profit or loss for the period in which they are incurred.
The Group uses the cost model for subsequent measurement of investment property, and theinvestment properties are depreciated over their useful lives using the straight-line method. Thedepreciation life, estimated residual value rate and annual depreciation rate of each category ofinvestment properties are as follows:
CHINA MERCHANTS PORT GROUP CO., LTD.
Category
| Category | Depreciation life (year) | Residual value rate (%) | Annual depreciation rate (%) |
| Land use rights | 21.25-50 | - | 2.00-4.71 |
| Buildings and structures | 10-43.17 | 5.00 | 2.20-9.50 |
An investment property is derecognized upon disposal or when the investment property ispermanently withdrawn from use and no future economic benefits are expected from the disposal.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
16. Investment properties - continued
When an investment property is sold, transferred, retired or damaged, the Group recognizes theamount of any proceeds on disposal net of the carrying amount and related taxes in profit or lossfor the period.
17. Fixed assets and depreciation
Fixed assets are tangible assets that are held for use in the production or supply of goods or services,for rental to others, or for administrative purposes, and have useful lives of more than oneaccounting year. A fixed asset is recognized only when it is probable that economic benefitsassociated with the asset will flow to the Group and the cost of the asset can be measured reliably.Fixed assets are initially measured at cost. Upon being restructured into a stock company, the fixedassets initially contributed by the state-owned shareholders are recognized based on the valuationamounts confirmed by the state-owned assets administration department.
Subsequent expenditures incurred for the fixed asset are included in the cost of the fixed asset if itis probable that economic benefits associated with the asset will flow to the Group and thesubsequent expenditures can be measured reliably. Meanwhile the carrying amount of the replacedpart is derecognized. Other subsequent expenditures are recognized in profit or loss for the periodin which they are incurred.
A fixed asset is depreciated over its useful life using the straight-line method starting from themonth subsequent to the one in which it is ready for intended use. The depreciation life, estimatednet residual value rate and annual depreciation rate of each category of fixed assets are as follows:
CHINA MERCHANTS PORT GROUP CO., LTD.
Category
| Category | Depreciation life (year) | Residual value rate (%) | Annual depreciation rate (%) |
| Port and terminal facilities | 5-50 | 5.00 | 1.90-19.00 |
| Buildings and structures | 5-30 | 5.00 | 1.90-19.00 |
| Machinery and equipment, furniture and fixture and other equipment | 3-20 | 5.00 | 4.75-31.67 |
| Motor vehicles and cargo ships | 5-25 | 5.00 | 3.80-19.00 |
Estimated net residual value of a fixed asset is the estimated amount that the Group would currentlyobtain from disposal of the asset, after deducting the estimated costs of disposal, if the asset werealready of the age and in the condition expected at the end of its useful life.
If a fixed asset is upon disposal or no future economic benefits are expected to be generated fromits use or disposal, the fixed asset is derecognized. When a fixed asset is sold, transferred, retiredor damaged, the amount of any proceeds on disposal of the asset net of the carrying amount andrelated taxes is recognized in profit or loss for the period.
The Group reviews the useful life and estimated net residual value of a fixed asset and thedepreciation method applied at least once at each financial year-end, and accounts for any changeas a change in accounting estimates.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
18. Construction in progress
Construction in progress is measured at its actual costs. The actual costs include variousconstruction expenditures during the construction period, borrowing costs capitalized before it isready for intended use and other relevant costs. Construction in progress is not depreciated.
Construction in progress is accounted for by categories of projects initiated, and is transferred to afixed asset when it is ready for intended use. The criteria for judging the intended use shall be oneof the following:
(1) The physical construction (including installation) of fixed assets has been fully or
substantially completed;
(2) The trial production or trial operation has been carried out and the results of which indicate
that the asset is capable of normal operation or producing qualified products on a stablebasis, or the results of which indicate that it is capable of normal functioning or operation;
(3) The fixed assets and intangible assets acquired and constructed have met the design or
contractual requirements or are basically in compliance with the design or contractualrequirements.
19. Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifyingasset are capitalized when expenditures for such asset and borrowing costs are incurred andactivities relating to the acquisition, construction or production of the asset that are necessary toprepare the asset for its intended use or sale have commenced. Capitalization of borrowing costsceases when the qualifying asset being acquired, constructed or produced becomes ready for itsintended use or sale. Capitalization of borrowing costs is suspended during periods in which theacquisition, construction or production of a qualifying asset is interrupted abnormally and when theinterruption is for a continuous period of more than 3 months. Capitalization is suspended until theacquisition, construction or production of the asset is resumed. Other borrowing costs arerecognized as an expense in the period in which they are incurred.
Where funds are borrowed under a specific-purpose borrowing, the amount of interest to becapitalized is the actual interest expense incurred on that borrowing for the period less any bankinterest earned from depositing the borrowed funds before being used on the asset or any investmentincome on the temporary investment of those funds. Where funds are borrowed under general-purpose borrowings, the Group determines the amount of interest to be capitalized on suchborrowings by applying a capitalization rate to the weighted average of the excess of cumulativeexpenditures on the asset over the amounts of specific-purpose borrowings. The capitalization rateis the weighted average of the interest rates applicable to the general-purpose borrowings. Duringthe capitalization period, exchange differences related to a specific-purpose borrowing denominatedin foreign currency are all capitalized. Exchange differences in connection with general-purposeborrowings are recognized in profit or loss for the period in which they are incurred.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
20. Intangible assets
20.1 Useful life and the basis for determination, estimates, amortization method or review
procedures
Intangible assets include land use rights, terminal operating rights and others.
An intangible asset is measured initially at cost. Upon being restructured into a stock company, theintangible assets initially contributed by the state-owned shareholders are recognized based on thevaluation amounts confirmed by the state-owned assets administration department. Except forterminal operating rights, when an intangible asset with a finite useful life is available for use, itsoriginal cost is amortized over its estimated useful life. The terminal operating rights under theoutput method are amortized over periods according to the ratio of the estimated minimumguaranteed throughput to the estimated minimum guaranteed total throughput during the operationperiod. When the estimated minimum guaranteed throughput cannot be measured reliably, thestraight-line method will be used for amortization. An intangible asset with indefinite useful lifewill not be amortized.
The amortization method, useful life and estimated net residual value rate of each category ofintangible assets are as follows:
CHINA MERCHANTS PORT GROUP CO., LTD.Category
| Category | Amortization method | Useful life (year) | Residual value (%) |
| Land use rights | Straight-line method | From the date of the land transfer, it is amortized using the straight-line method over the land transfer period | - |
| Terminal operating right | Output/Straight-line method | Output method - it is amortized over periods according to the ratio of the estimated minimum guaranteed throughput to the estimated minimum guaranteed total throughput; straight-line method - it is amortized using the straight-line method over the shortest of the estimated useful life, the beneficial period specified in the contract and the effective life as defined by law | - |
| Others | Straight-line method | It is amortized using the straight-line method over the shortest of the estimated useful life, the beneficial period specified in the contract and the effective life as defined by law | - |
For an intangible asset with a finite useful life, the Group reviews the useful life and amortizationmethod at the end of the year, and makes adjustments when necessary.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
20. Intangible assets - continued
20.2 Scope of R&D expenditure and method for accounting treatment
Expenditure during the research phase is recognized in profit or loss for the period in which it isincurred.
Expenditure during the development phase that meets all of the following conditions at the sametime is recognized as intangible asset. Expenditure during development phase that does not meetthe following conditions is recognized in profit or loss for the period:
(1) it is technically feasible to complete the intangible asset so that it will be available for use
or sale.
(2) the Group has the intention to complete the intangible asset and use or sell it.
(3) the Group can demonstrate the ways in which the intangible asset will generate economic
benefits, including the evidence of the existence of a market for the output of the intangibleasset or the intangible asset itself or, if it is to be used internally, the usefulness of theintangible asset.
(4) the availability of adequate technical, financial and other resources to complete the
development and the ability to use or sell the intangible asset.
(5) the expenditure attributable to the intangible asset during its development phase can be
reliably measured.
If the expenditures cannot be distinguished between the research phase and development phase, theGroup recognizes all of them in profit or loss for the year. The costs of intangible assets generatedby the internal research only include the total expenditure incurred for the period from the timepoint of capitalization to the time point when the intangible assets are ready for intended use. Forthe identical intangible asset, the expenditures recorded as expenses before they qualify forcapitalization during the development process are not adjusted.
The Group classifies the expenditures on an internal research and development project intoexpenditures in the research phase and expenditures in the development phase. The scope of R&Dexpenditures refer to those directly related to the R&D activities, including wages, salaries, andwelfare expenses of personnel directly engaged in R&D activities, materials directly consumed inR&D activities, depreciation expenses for instruments and equipment used in R&D activities, travel,transportation, and communication expenses required for research and experimental development,etc. Technical feasibility and economic viability studies are adopted as specific criteria forclassifying the research and development phases once such studies have been evaluated andapproved.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
21. Impairment of long-term assets
The Group assesses at the balance sheet date whether there is any indication that long-term equityinvestments, investment properties measured at cost model, fixed assets, construction in progress,right-of-use assets, intangible assets with a finite useful life and assets related to contract costs maybe impaired. If there is any indication that such assets may be impaired, recoverable amounts areestimated for such assets. Intangible assets with indefinite useful life and intangible assets not yetavailable for use are tested for impairment annually, irrespective of whether there is any indicationthat the assets may be impaired.
Recoverable amount is estimated on an individual basis. If it is not practical to estimate therecoverable amount of an individual asset, the recoverable amount of the asset group to which theasset belongs will be estimated. The recoverable amount of an asset is the higher of its fair valueless costs of disposal and the present value of the future cash flows expected to be derived from theasset.
If the recoverable amount of an asset or an asset group is less than its carrying amount, the deficitis accounted for as an impairment loss and is recognized in profit or loss.
Goodwill is tested for impairment at least at the end of each year. For the purpose of impairmenttesting, goodwill is considered together with the related assets group(s) or portfolio of assetsgroup(s), i.e., goodwill is reasonably allocated to the related assets group(s) or portfolio of assetsgroup(s) expected to benefit from the synergies of the combination. An impairment loss isrecognised if the recoverable amount of the assets group(s) or portfolio of assets group(s) (includinggoodwill) is less than its carrying amount. The impairment loss is firstly allocated to reduce thecarrying amount of any goodwill allocated to such assets group(s) or portfolio of assets group(s),and then to the other assets of the group pro-rata on the basis of the carrying amount of each asset(other than goodwill) in the group.
Once the impairment loss of above-mentioned assets is recognized, it shall not be reversed in anysubsequent period.
22. Long-term prepaid expenses
Long-term prepaid expenses represent expenses incurred that should be borne and amortized overthe current and subsequent periods (together of more than one year). Long-term prepaid expensesare amortized using the straight-line method over the expected periods in which benefits are derived.
23. Contract liabilities
Contract liabilities refer to the Group's obligation to transfer goods or services to a customer forconsideration received or receivable from the customer. The contract assets and contract liabilitiesunder the same contract are presented on a net basis.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
24. Employee benefits
24.1 Short-term employee benefits
Short-term benefits refer to the employee benefits that the Group is required to make full paymentswithin 12 months after the annual reporting period during which relevant services are provided bythe employees, except the post-employment benefits and termination benefits. Specifically, theshort-term benefits include: employee salaries, bonuses, allowances and subsidies, employeebenefits, social insurance contributions such as the medical insurance and the work injury insurance,housing funds, trade union funds and employee education funds, short-term paid absence, short-term profit sharing plan, non-monetary welfare and other short-term benefits.
Short-term employee benefits payable are recognized as liabilities, with a corresponding charge toprofit or loss for the period or in the costs of relevant assets in the accounting period in whichemployees provide services to the Group. Staff welfare expenses incurred by the Group arerecognized in profit or loss for the period or the costs of relevant assets based on the actuallyoccurred amounts when they actually occurred. Non-monetary staff welfare expenses are measuredat fair value.
Payment made by the Group of social security contributions for employees such as premiums orcontributions on medical insurance, work injury insurance and maternity insurance, etc. andpayments of housing funds, as well as union running costs and employee education costs providedin accordance with relevant requirements, are calculated according to prescribed bases andpercentages in determining the amount of employee benefits and recognized as relevant liabilities,with a corresponding charge to profit or loss for the period or the costs of relevant assets in theaccounting period in which employees provide services.
24.2 Post-employment benefits
Post-employment benefits refer to the rewards and benefits of various forms provided by the Groupafter the employees have retired or terminated the labor relationship with the enterprise for theservices rendered by the employees, except the short-term benefits and the termination benefits.The post-employment benefits consist of the pension insurance, the annuity, the unemploymentinsurance and other post-employment benefits.
Post-employment benefit plans are classified by the Group into defined contribution plans anddefined benefit plans. The post-employment benefit plan refers to the agreements the Group enteredinto with the employees on the post-employment benefits or the regulations or measures establishedby the Group for provisions of the post-employee benefits, among which the defined contributionplans refer to the post-employment benefit plan under which the Group shall no longer undertakeany obligations of payments after paying fixed expenses to independent funds; the defined benefitplans refer to the post-employment benefit plans other than the defined contribution plans. Duringthe accounting period in which employees render services to the Group, the amounts payablecalculated based on the defined contribution plans are recognized as liabilities and included in profitor loss for the period or costs of related assets.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
24. Employee benefits - continued
24.2 Post-employment benefits - continued
For defined benefit plans, the Group attributes the welfare obligations arising from the definedbenefit plans to the period in which employees provide services to the Group according to theformula determined based on the projected cumulative benefit unit method, and includes them inprofit or loss for the period or costs of related assets. Defined benefit costs are categorized as follows:
? Service cost (including current service cost, past service cost, as well as gains and losses on
settlements);? Net interest of net liabilities or assets of defined benefit plans (including interest income of
planned assets, interest expenses of defined benefit plan liabilities and effect of asset ceiling);
and? Changes arising from remeasurement of net liabilities or net assets of defined benefit plans.
Service costs and net interest of net liabilities and net assets of defined benefit plans are recognizedin profit or loss for the period or costs of related assets. Remeasurement of the net defined benefitliabilities (assets) (including actuarial gains and losses, the return on planned assets, excludingamounts included in net interest on net defined benefit liabilities (assets), and any changes in theeffect of the asset ceiling, excluding amounts included in net interest on net defined benefitliabilities (assets)) are recognized in other comprehensive income.
The deficit or surplus resulting from the present value of the defined benefit plan obligations lessthe fair value of the defined benefit plan assets is recognized as a net defined benefit plan liabilityor net asset.
24.3 Termination benefits
Termination benefits refer to the compensations the Group pay to the employees for terminating theemployment relationship with employees before the expiry of the employment contracts orencouraging employees to accept voluntary redundancy. When the Group provides terminationbenefits to employees, employee benefit liabilities are recognized for termination benefits, with acorresponding charge to profit or loss for the period at the earlier of: (1) when the Group cannotunilaterally withdraw the offer of termination benefits because of the termination plan or acurtailment proposal; and (2) when the Group recognizes costs or expenses related to restructuringthat involves the payment of termination benefits.
24.4 Other long-term employee benefits
Other long-term employee benefits refer to all employee benefits except for short-term benefits,post-employment benefits, and termination benefits.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
24. Employee benefits - continued
24.4 Other long-term employee benefits - continued
Other long-term employee benefits that qualify as defined contribution plans are treated inaccordance with the relevant provisions of the defined contribution plans mentioned above, exceptthat the net liability or net asset for other long-term employee benefits is recognized and measuredin accordance with the relevant provisions of the defined benefit plans. At the end of the reportingperiod, employee compensation costs arising from other long-term employee benefits arerecognized as three components: service cost, net interest on net liability or net asset for other long-term employee benefits, and changes resulting from the remeasurement of the net liability or netasset for other long-term employee benefits. The total net amount of these items is included in profitor loss for the period or in the costs of related assets.
The Group provides internal retirement benefits to employees accepting the internal retirementarrangements. Internal retirement benefits refer to the payments of salaries and social securitycontributions for employees who reach the retirement age regulated by the country and are approvedto quit the job voluntarily. For internal retirement benefits, the internal retirement benefits the Groupis expected to pay during the period from the date when employees stop providing services to thedate of normal retirement are recognized as liabilities at the present value and included in profit orloss for the period when relevant recognition requirements of the internal retirement benefits aremet.
25. Provisions
Provisions are recognized when the Group has a present obligation related to a contingency, it isprobable that an outflow of economic benefits will be required to settle the obligation, and theamount of the obligation can be measured reliably.
The amount recognized as a provision is the best estimate of the consideration required to settle thepresent obligation at the balance sheet date, taking into account factors pertaining to a contingencysuch as the risks, uncertainties and time value of money. Where the effect of the time value of moneyis material, the amount of the provision is determined by discounting the related future cashoutflows.
Where all or some of the expenditure required to settle a provision is expected to be reimbursed bya third party, the reimbursement is recognized as a separate asset only when it is virtually certainthat reimbursement will be received, and the amount of reimbursement recognized does not exceedthe carrying amount of the provision.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
26. Share-based payments
A share-based payment is a transaction which the Group grants equity instruments, in return forservices rendered by employees or other parties. The Group's share-based payments include equity-settled share-based payments.
Equity-settled share-based payments in exchange for services rendered by employees are measuredat fair value of the equity instruments granted to employees at the grant date. Such amount isrecognized as related costs or expenses on a straight-line basis over the vesting period, based on thebest estimate of the number of equity instruments expected to vest/ as related costs or expenses atthe grant date, if the equity instruments could be vested immediately, with a corresponding increasein capital reserve.
27. Preferred stock, perpetual bonds and other financial instruments
The consideration received by the Group for the issuance of equity instruments is included inshareholders' equity after deducting transaction costs. Repurchase the consideration and transactioncosts paid by the Group's equity instruments to reduce shareholders' equity.
The Group classifies financial instruments, or their components, as financial liabilities or equityinstruments at initial recognition based on the contractual terms of the issued perpetual bonds andtheir reflected economic substance, combined with the definitions of financial liabilities and equityinstruments.
For financial instruments such as perpetual bonds classified as equity instruments, interest expenseor dividend (dividend) distributions are treated as profit distributions of the Group, and theirrepurchases, write-offs, etc., are treated as changes in equity, and related transaction costs arededucted from equity.
28. Revenue recognition
28.1 Disclosure of accounting policies adopted for revenue recognition and measurement by type
of business
The Group's revenue is mainly from port business, bonded logistics business and other businesses.
The Group recognizes revenue based on the transaction price allocated to the performanceobligation when the Group satisfies a performance obligation in the contract, namely, when thecustomer obtains control over relevant goods or services. A performance obligation is acommitment that the Group transfers a distinct goods or service to a customer in the contract.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
28. Revenue recognition - continued
28.1 Disclosure of accounting policies adopted for revenue recognition and measurement by type
of business - continued
It is a performance obligation satisfied during a period of time and the Group recognizes revenueduring a period of time according to the progress of performance if one of the following conditionsis met: (i) the customer obtains and consumes economic benefits at the same time of the Group'sperformance; (ii) the customer is able to control goods or services in progress during the Group'sperformance; (iii) goods or services generated during the Group's performance have irreplaceableutilization, and the Group is entitled to collect amounts of cumulative performance part which havebeen done up to now. Otherwise, revenue is recognized at a point in time when the customer obtainscontrol over the relevant goods or services.
The Group adopts output method, i.e., the value of goods or services transferred to customers todetermine the appropriate progress of performance. Where the progress cannot be determinedreasonably, the revenue is recognized based on the amount of cost that is expected to becompensated based on the cost already incurred, until the progress of performance is reasonablydetermined.
The transaction price is the amount of consideration to which the Group expects to be entitled inexchange for transferring promised goods or services to a customer, excluding amounts collectedon behalf of third parties and amounts expected to be refunded to a customer. In determining thetransaction price, the Group should consider the effects of variable consideration, significantfinancing components in the contract, non-cash consideration and consideration payable tocustomers.
If there are two or more of performance obligations included in the contract, at the inception of thecontract, the Group allocates the transaction price to each single performance obligation based onthe proportion of stand-alone selling price of goods or services promised in each stand-aloneperformance obligation. However, if there is conclusive evidence indicating that the contractdiscount or variable consideration is only relative with one or more (not the whole) performanceobligations in the contract, the Group will allocate the contract discount or variable considerationto relative one or more performance obligations. Stand-alone selling price refers to the price of asingle sale of goods or services. If the stand-alone selling price cannot be observed directly, theGroup estimates the stand-alone selling price through comprehensive consideration of all relativeinformation that can be reasonably acquired and maximum use of observable inputs.
In case of the existence of variable consideration (such as sales discount) in the contract, the Groupshall determine the best estimate of variable consideration based on the expected value or the mostprobably occurred amount. The transaction price including variable consideration shall not exceedthe amount of the cumulatively recognized revenue which is unlikely to be significantly reversedwhen relevant uncertainty is eliminated. At each balance sheet date, the Group re-estimates theamount of variable consideration which should be included in transaction price.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
28. Revenue recognition - continued
28.1 Disclosure of accounting policies adopted for revenue recognition and measurement by type
of business - continued
If the customer pays non-cash consideration, the Group determines the transaction price based onthe fair value of the non-cash consideration. If the fair value of non-cash consideration cannot bereasonably estimated, the Group shall determine the transaction price indirectly by reference to thestand-alone selling price of the goods or services promised to transfer to the customer.
In case of the existence of a significant financing component in the contract, the Group shalldetermine the transaction price on the assumption that the customer has paid the amount payableby cash when obtaining the control over the goods or services. Differences between transactionprice and contract consideration are amortized using effective interest method during the contractlife. At the inception of the contract, if the period between when the Group transfers a promisedgoods or service to a customer and when the customer pays for that goods or service will be oneyear or less, the Group would not consider the significant component in the contract.
The Group assesses whether it controls each specified goods or service before that goods or serviceis transferred to the customer to determine whether the Group is a principal or an agent. If the Groupcontrols the specified good or service before that good or service is transferred to a customer, theGroup is a principal and recognizes revenue in the gross amount of consideration received orreceivable. Otherwise, the Group is an agent and recognizes revenue in the amount of any fee orcommission to which it expects to be entitled. The fee or commission is the net amount ofconsideration that the Group retains after paying the other party the consideration received inexchange for the goods or services to be provided by that party, or is determined in accordance withthe established commission amount or percentage, etc.
Where the Group receives receipts in advance from a customer for sales of goods or rendering ofservices, the amount is first recognized as a liability and then transferred to revenue when the relatedperformance obligation has been satisfied. When the Group's receipts in advance are not requiredto be refunded and it is probable that the customer will waive all or part of its contractual rights, theGroup recognizes the said amounts as revenue on a pro-rata basis in accordance with the pattern ofexercise of the customer's contractual rights, if the Group expects to be entitled to the amountsrelating to the contractual rights waived by the customer; otherwise, the Group reverses the relatedbalance of the said liabilities to revenue only when it is highly unlikely that the customer will requireperformance of the remaining performance obligations.
For port business, the revenue from the handling of containers and bulk cargos is recognized overtime based on the progress of completed services, and the revenue from the storage of containersand bulk cargos is recognized on a straight-line basis over the period of storage.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
28. Revenue recognition - continued
28.1 Disclosure of accounting policies adopted for revenue recognition and measurement by type
of business - continued
For bonded logistics business, the revenue is recognized based on the progress of services rendered,where the progress of completed services is determined based on the proportion of days on servicesprovided to the estimated total number of service days. As at the balance sheet date, the Group hasre-estimated the progress of completed bonded logistics service so that it reflects the changes inperformance status.
28.2 Similar operations under different business models which involve different revenue
recognition and measurement methods
The Group has no similar operations under different business models which involve differentrevenue recognition and measurement methods.
29. Contract costs
29.1 Costs of obtaining a contract
For the incremental cost of obtaining the contract (cost that will not occur if the contract is notobtained) that is expected to be recoverable, it is recognized as an asset. If the amortization periodof such asset is less than one year, it is recognized in profit or loss for the period when incurred.Other expenses incurred for obtaining the contract is included in profit or loss for the period whenincurred, except for those explicitly assumed by the customer.
29.2 Costs to fulfil a contract
If the costs incurred in fulfilling a contract are not within the scope of any standards other thanRevenue Standards, the Group recognizes an asset only if those costs meet all of the followingcriteria: (1) the costs relate directly to a contract or to an anticipated contract that the Group canspecifically identify; (2) the costs enhance resources of the Group that will be used in satisfyingperformance obligations in the future; and (3) the costs are expected to be recovered. The assetmentioned above shall be amortized on a basis that is consistent with the revenue recognition of thegoods or services to which the asset relates and recognized in profit or loss for the period.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
29. Contract costs - continued
29.3 Impairment loss of assets related to contract costs
In determining the impairment losses of assets related to contract costs, the Group first determinesthe impairment losses of other assets related to contracts recognized in accordance with other ASBE;then, for assets related to contract costs, if the carrying amount of the assets is higher than thedifference between: (1) the remaining consideration that the Group expects to obtain for the transferof the goods or services related to the assets; and (2) the estimated costs to be incurred for thetransfer of the related goods or services, any excess is provided for impairment and recognized asimpairment loss of assets.
After the provision for impairment of assets related to contract costs is made, if the factors ofimpairment in previous periods change so that the difference between the above two is higher thanthe carrying amount of the assets, the original provision for impairment of the assets is reversed andrecognized in profit or loss for the period, provided that the carrying amount of the assets after thereversal does not exceed the carrying amount of the assets at the date of reversal assuming noprovision for impairment was made.
30. Government grants
Government grants are transfer of monetary assets or non-monetary assets from the government tothe Group at no consideration. A government grant is recognized only when the Group can complywith the conditions attached to the grant and the Group will receive the grant.
If a government grant is in the form of a transfer of a monetary asset, it is measured at the amountreceived or receivable. If a government grant is in the form of a non-monetary asset, it is measuredat fair value. If the fair value cannot be reliably determined, it is measured at a nominal amount. Agovernment grant measured at a nominal amount is recognized immediately in profit or loss for theperiod.
30.1 Determination basis and accounting treatment of government grant related to assets
Government grants of the Group mainly include grants for intelligent system, etc., and thesegovernment grants relate to assets as they will form long-term assets.
A government grant related to an asset is recognized as deferred income, and evenly amortized toprofit or loss over the useful life of the related asset. A government grant measured at a nominalamount is recognized immediately in profit or loss in the current period. Where the relevant assetis sold, transferred, retired or damaged prior to the end of its useful life, the related undistributeddeferred income is transferred to profit or loss of the disposal period.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
30. Government grants - continued
30.2 Determination basis and accounting treatment of government grant related to income
Government grants of the Group mainly include grants for business development and specializedoperations, etc., and these government grants relate to income as they will not form long-term assets.The Group classifies government grants that are difficult to be distinguished as government grantsrelated to income aggregately.
For a government grant related to income, if the grant is a compensation for related expenses orlosses to be incurred in subsequent periods, the grant is recognized as deferred income andrecognized in profit or loss for the period in which the related costs or losses are recognized; If thegrant is a compensation for related expenses or losses already incurred, the grant is recognizedimmediately in profit or loss.
A government grant related to the Group's daily activities is recognized in other income or chargedagainst related costs based on the nature of economic activities; a government grant not related tothe Group's daily activities is recognized in non-operating income.
31. Income tax
The income tax expenses include current income tax and deferred income tax.
31.1 Current income tax
At the balance sheet date, current income tax liabilities (or assets) for the current and prior periodsare measured at the amount expected to be paid (or recovered) according to the requirements of taxlaws.
31.2 Deferred tax assets and deferred tax liabilities
For temporary differences between the carrying amounts of certain assets or liabilities and their taxbase, or between the nil carrying amount of those items that are not recognized as assets or liabilitiesand their tax base that can be determined according to tax laws, deferred tax assets and liabilitiesare recognized using the balance sheet liability method.
Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred taxassets for deductible temporary differences are recognized to the extent that it is probable thattaxable profits will be available against which the deductible temporary differences can be utilized.However, for temporary differences associated with the initial recognition of goodwill and theinitial recognition of an asset or liability arising from a transaction, which is not a businesscombination that affects neither the accounting profit nor taxable profits (or deductible losses) andwill not result in taxable temporary differences and deductible temporary differences in equivalentamounts at the time of transaction, no deferred tax asset or liability is recognized.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
31. Deferred tax assets/ deferred tax liabilities - continued
31.2 Deferred tax assets and deferred tax liabilities - continued
For deductible losses and tax credits that can be carried forward, deferred tax assets are recognizedto the extent that it is probable that future taxable profits will be available against which thedeductible losses and tax credits can be utilized.
Deferred tax liabilities are recognized for taxable temporary differences associated withinvestments in subsidiaries, associates and joint ventures, except where the Group is able to controlthe timing of the reversal of the temporary differences and it is probable that the temporarydifferences will not be reversed in the foreseeable future. Deferred tax assets arising fromdeductible temporary differences associated with investments in subsidiaries, associates and jointventures are recognized to the extent that it is probable that future taxable profits will be availableagainst which the deductible temporary differences can be utilized and they are expected to bereversed in the foreseeable future.
At the balance sheet date, deferred tax assets and liabilities are measured at the tax rates applicablein the period in which the asset is realized or the liability is settled according to tax laws.
Current and deferred tax expenses or income are recognized in profit or loss for the period, exceptwhen they arise from transactions or events that are directly recognized in other comprehensiveincome or shareholders' equity, in which case they are recognized in other comprehensive incomeor shareholders' equity, and when they arise from business combinations, in which case they adjustthe carrying amount of goodwill.
At the balance sheet date, the carrying amount of deferred tax assets is reviewed and reduced if itis no longer probable that sufficient taxable profits will be available in the future to allow the benefitof deferred tax assets to be utilized. Any such reduction in amount is reversed when it becomesprobable that sufficient taxable profits will be available.
31.3 Income tax offsetting
When the Group has a legal right to settle on a net basis and intends either to settle on a net basisor to realize the assets and settle the liabilities simultaneously, current tax assets and current taxliabilities are offset and presented on a net basis.
When the Group has a legal right to settle current tax assets and liabilities on a net basis, anddeferred tax assets and deferred tax liabilities relate to income taxes levied by the same taxationauthority on either the same taxable entity or different taxable entities which intend either to settlecurrent tax assets and liabilities on a net basis or to realize the assets and liabilities simultaneously,in each future period in which significant amounts of deferred tax assets or liabilities are expectedto be reversed, deferred tax assets and deferred tax liabilities are offset and presented on a net basis.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
32. Leases
A lease is a contract in which the lessor, for a certain period of time, gives the lessee the right touse the assets to obtain a consideration.
For contracts entered into, the Group assesses whether the contract is, or contains, a lease at thecommencement date. Such contract will not be reassessed unless the terms and conditions of thecontract are subsequently changed.
32.1 The Group as lessee
32.1.1 Separating components of a lease
For a contract that contains one or more lease components or non-lease components, the Groupseparates each individual lease and non-lease component and allocates the contract considerationin the relative proportion of the sum of the individual price of each lease component and theindividual price of the non-lease component.
32.1.2 Right-of-use assets
Except for short-term leases and leases of low-value assets, the Group recognizes the right-of-useassets of the leases at the commencement date. The commencement date of the lease is the datefrom which the lessor provides the leased assets to make them available for use by the Group. Right-of-use assets are initially measured at cost. The cost includes:
? the amount of the initial measurement of the lease liabilities.? any lease payments made at or before the commencement date, less any lease incentives.? any initial direct costs incurred by the Group.? an estimate of costs to be incurred by the Group in dismantling and removing the underlyingasset, restoring the site on which it is located or restoring the underlying asset to the conditionrequired by the terms and conditions of the lease.
Right-of-use assets are depreciated by the Group in accordance with the ASBE No.4 Fixed Assets.If the Group is reasonably certain, that the lease will transfer ownership of the underlying asset tothe Group by the end of the lease term, the right-of-use assets are depreciated from thecommencement date to the end of the useful life of the underlying asset. Otherwise, the right-of-use assets are depreciated from the commencement date to the earlier of the end of the useful lifeof the right-of-use assets or the end of the lease term.
The Group applies ASBE No. 8 Impairment of Assets, to determine whether the right-of-use assetsare impaired and to account for any impairment loss identified.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
32. Leases - continued
32.1 The Group as lessee - continued
32.1.3 Lease liabilities
Except for short-term leases and leases of low-value assets, the Group initially measures leaseliabilities at the present value of the outstanding lease payments at the commencement date. Incalculating the present value of the lease payments, the Group uses the implicit interest rate of thelease as the discount rate. If it is not possible to determine the implicit interest rate of the lease,the incremental borrowing rate shall be applied.
The lease payments comprise the following payments by the Group for the right to use theunderlying asset during the lease term:
? fixed payments (including in-substance fixed payments), less any lease incentives.? variable lease payments that depend on an index or a rate.? the exercise price of a purchase option if the Group is reasonably certain to exercise that
option.? payments for terminating the lease, if the lease term reflects the Group exercising an option
to terminate the lease.? amounts expected to be payable by the Group under residual value guarantees.
Variable lease payments that depend on an index or a rate, are initially measured using the indexor rate as at the commencement date. Variable lease payments not included in the measurement ofthe lease liabilities, are recognized in profit or loss, or in the cost of relevant assets, in the periodof those payments.
After the commencement date, interest expenses on the lease liabilities in each period during thelease term is calculated by a constant periodic rate of interest, and included in profit or loss orcharged to cost of related assets.
After the commencement date, the Group shall remeasure the lease liabilities and makecorresponding adjustments to the related right-of-use assets in the following circumstances. If thecarrying amount of the right-of-use assets is reduced to zero and there is a further reduction in themeasurement of the lease liabilities, the Group shall recognize the difference in profit or loss:
? where there is a change in the lease term, or in the assessment of an option to purchase the
underlying asset, the Group remeasures the lease liabilities, on the basis of the revised lease
term and the revised discount rate;? where there is a change in the amounts expected to be payable under a residual value
guarantee, or in future lease payments resulting from a change in an index or a rate used to
determine those payments, the Group remeasures the lease liabilities, on the basis of the
revised lease payments and the unchanged discount rate, unless the change in the lease
payments results from a change in floating interest rates, in which case a revised discount
rate is applied to calculate the present value.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
32. Leases - continued
32.1 The Group as lessee - continued
32.1.4 Short-term leases and leases of low-value assets
The Group elects not to recognize right-of-use assets or lease liabilities for short-term leases andleases of low-value assets, i.e., port and terminal facilities, buildings, machinery and equipment,furniture, fixture and other equipment, motor vehicles and cargo ships and others. A short-termlease is a lease that, at the commencement date, has a lease term of 12 months or less and does notcontain a call option. A lease of low-value assets is a lease that, the value of the underlying asset isless than RMB50,000 when it is new. For short-term leases and leases of low-value assets, theGroup recognizes the lease payments in profit or loss, or in the cost of related assets on a straight-line basis over each period within the lease term.
32.1.5 Lease modifications
A lease modification should be accounted for as a separate lease if both of the following apply:
? the modification increases the scope of the lease by adding the right to use one or moreunderlying assets.? the consideration for the lease increases by an amount commensurate with the stand-aloneprice for the increase in scope and any appropriate adjustments to that stand-alone priceaccording to the circumstances of the particular contract.
For a lease medication that is not accounted for as a separate lease, at the effective date of the leasemodification, the Group should allocate the consideration in the modified contract, determine thelease term of the modified lease and remeasure the lease liabilities based on the present value of thechanged lease payments and the revised discount rate.
For lease modifications that decrease the scope of the lease or shorten the term of the lease, theGroup should decrease the carrying amount of the right-of-use assets with any gain or loss relatingto the partial or full termination of the lease recognized in profit or loss. For re-measurement oflease liabilities due to other lease modifications, a corresponding adjustment is made to the carryingamount of the right-of-use assets.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
32. Leases - continued
32.1 The Group as lessee - continued
32.1.6 Sale and leaseback transactions
The Group as seller-lessee
The Group applies the requirements of Revenue Standard to determine whether the transfer of anasset is accounted for as a sale of that asset. If the transfer of an asset does not constitute a sale, theGroup shall continue to recognize the transferred assets, recognize a financial liability equal to thetransfer proceeds and accounts for such financial liability in accordance with the AccountingStandards for Business Enterprises No. 22 - Financial Instruments: Recognition and Measurement.If the transfer of an asset is a sale, the Group shall measure the right-of-use assets arising from theleaseback at the proportion of the previous carrying amount of the asset that relates to the right ofuse, and recognize any gain or loss for rights transferred to the lessor only.
32.2 The Group as lessor
32.2.1 Separating components of a lease
For a contract that contains lease components and non-lease components, the Group allocates thecontract consideration in accordance with the Revenue Standards on allocation of transaction prices,based on the respective individual prices of the lease components and the non-lease components.
32.2.2 Classification of leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all therisks and rewards of ownership. All other leases are classified as operating leases.
32.2.2.1 The Group as lessor under operating leases
The Group recognizes lease receipts from operating leases as rental income using a straight-linemethod over the respective periods of the lease term. The Group's initial direct costs incurred inconnection with operating leases are capitalized when the costs incurred, and are allocated to profitor loss for the period over the lease term on the same basis as the recognition of rental income.
Variable lease receipts acquired by the Group in connection with operating leases that are notincluded in the lease receipts are recognized in profit or loss for the period when they are actuallyincurred.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
32. Leases - continued
32.2 The Group as lessor - continued
32.2.2 Classification of leases - continued
32.2.2.2 The Group as lessor under finance leases
At the commencement date, the Group recognizes a finance lease receivable at the amount equal tothe net lease investment with assets under finance lease derecognized. The net lease investment isthe sum of any unguaranteed residual value and the present value of the lease receipts over the leaseterm discounted at the interest rate implicit in lease.
The lease receivable comprises the following payments collected by the Group from the lessee forthe transfer of the right to use the underlying assets during the lease term:
? fixed payments (including in-substance fixed payments) paid by the lessee, less any leaseincentives.? variable lease payments that depend on an index or a rate.? the exercise price of a purchase option, provided that it is reasonably determined that thelessee will exercise the option.? payments for terminating the lease, provided that the lease term reflects that the lessee will
exercise the option to terminate the lease;? residual value of guarantee provided to the Group by the lessee, a party related to the lessee
and an independent third party with the financial ability to fulfil the guarantee obligations.
Variable lease receipts not included in the net lease investment are recognized in profit or loss whenthey are actually incurred.
Interest income for each period over the lease term is calculated and recognized by the Group at afixed periodic rate.
32.2.3 Subleases
As the lessor of a sublease, the Group accounts for the original lease contract and the subleasecontract on a separate basis. The Group classifies the subleases based on the right-of-use assetsgenerating from the original lease rather than the underlying assets of the original lease.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
32. Leases - continued
32.2 The Group as lessor - continued
32.2.4 Lease modifications
The Group accounts for a modification to an operating lease as a new lease from the effective dateof the modification, considering any lease advances or receivables relating to the original lease asthe lease receipts for the new lease.
A lease modification should be accounted for as a separate lease if there is a modification in afinance lease and both of the followings apply:
? the modification increases the scope of the lease by adding the right to use one or moreunderlying assets; and? the consideration for the lease increases by an amount commensurate with the stand-aloneprice for the increase in scope with any appropriate adjustment to that stand-alone price.
For a modification to a finance lease that is not accounted for as a separate lease, the Group accountsfor the modification as follows:
? If the lease would have been classified as an operating lease had the modification been
effective at the commencement date, the Group should account for the lease modification asa new lease from the effective date of the modification, and measure the carrying amount ofthe underlying assets at the amount equal to the net lease investment before the effective dateof the modification;? If the lease would have been classified as a finance lease had the modification been effective
at the commencement date, the Group should account for it in accordance with the provisionson contract modification and renegotiation under Accounting Standards for BusinessEnterprises No. 22 - Financial Instruments: Recognition and Measurement.
32.2.5 Sale and leaseback transactions
The Group as the buyer-lessor
If the transfer of an asset in a sale and leaseback transaction does not constitute a sale, the Groupdoes not recognize the transferred asset but a financial asset at an amount equal to the transferproceeds, and accounts for such financial asset under the Accounting Standards for BusinessEnterprises No. 22 - Financial Instruments: Recognition and Measurement. If the transfer of anasset constitutes a sale, the Group accounts for the purchase of the asset in accordance with otherapplicable Accounting Standards for Business Enterprises and accounts for the lease of the asset.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(IV) SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
33. Exchange of non-monetary assets
When the non-monetary assets are of commercial substance and the fair value of assets received orthe assets given up can be measured reliably, the non-monetary transactions are measured at fairvalue. For the asset received, the fair value of the asset given up and related taxes payable arerecognized as the cost at initial recognition; For the asset given up, at derecognition, the differencebetween the fair value and the carrying amount is recognized in profit or loss for the current period.When there is clear evidence indicating that the fair value of the received asset is more reliable, forthe asset received, the fair value of the asset received and related taxes payable are recognized asthe cost at initial recognition; For the asset given up, at derecognition, the difference between thefair value of the asset received and the carrying amount of the asset given up is recognized in profitor loss for the current period.
When the non-monetary transactions fail to meet criteria to be measured at fair value, thetransactions are measured at carrying amounts. For the asset received, the carrying amount of theasset given up and relevant taxes payable are recognized as the cost of at initial recognition. For theasset given up, at derecognition, no profit or loss is recognized.
34. Safety production cost
According to the Administrative Measures for the Collection and Utilization of Enterprise WorkSafety Funds (Cai Zi [2022] No. 136) jointly issued by the Ministry of Finance and the EmergencyDepartment on 13 December 2022, safety production cost set aside by the Group is directly includedin the cost of relevant products or recognized in profit or loss for the period, and transferred tospecial reserve simultaneously. When safety production cost set aside is utilized, if the costsincurred can be categorized as expenditure, the costs incurred should be charged against the specialreserve. If the costs set aside are used to build up fixed assets, the costs should be charged toconstruction in progress, and reclassified to fixed assets when the safety projects are ready forintended use. Meantime, expenditures in building up fixed assets are directly charged against thespecial reserve with the accumulated depreciation recognized at the same amount. Depreciation willnot be made in the future period on such fixed assets.
(V) CRITICAL JUDGMENTS IN APPLYING ACCOUNTING POLICIES AND KEY
ASSUMPTIONS AND UNCERTAINTIES IN ACCOUNTING ESTIMATES
In the application of accounting policies and accounting estimates as set out in Note (IV), the Groupis required to make judgments, estimates and assumptions about the carrying amounts of items inthe financial statements that cannot be measured accurately, due to the internal uncertainty of theoperating activities. These judgments, estimates and assumptions are based on historical experienceof the Group's management as well as other factors that are considered to be relevant. Actual resultsmay differ from these estimates.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(V) CRITICAL JUDGMENTS IN APPLYING ACCOUNTING POLICIES AND KEY
ASSUMPTIONS AND UNCERTAINTIES IN ACCOUNTING ESTIMATES - continued
The Group regularly reviews the judgments, estimates and assumptions on a going concern basis.Changes in accounting estimates which only affect the current period should be recognized in thecurrent period; changes which not only affect the current but the future periods should be recognizedin the current and future periods. At the balance sheet date, key assumptions and uncertainties incritical judgments and accounting estimates that are likely to lead to significant adjustments to thecarrying amounts of assets and liabilities in the future are as follows:
Goodwill impairment
For the purpose of impairment testing, the present value of the expected future cash flows of theassets group or portfolio including goodwill shall be calculated, and such expected future cash flowsshall be estimated. Meantime, a rate shall be determined that should reflect the time value of moneyon the current market and the specific interest risks.
Recognition of deferred income tax
The Group calculates and makes provision for deferred tax liabilities according to the profitdistribution plans of subsidiaries, associates and joint ventures and relevant provisions of tax law.For retained earnings of the investee which are not expected to be distributed, since the profits willbe used for the daily operation and future development of the investee, no deferred tax liabilitiesare recognized. If the profits to be actually distributed in future years are more or less than thoseexpected, corresponding deferred tax liabilities will be recognized or reversed in profit or loss forthe period at the earlier of the date on which the profit distribution plan is changed and the date onwhich the profit distribution is declared.
Deferred tax assets are recognized based on the deductible temporary differences and thecorresponding tax rate, to the extent that it is probable that future taxable profits will be availableagainst which the deductible temporary differences can be utilized. If the actual taxable income infuture years are more or less than that expected, corresponding deferred tax assets will berecognized or reversed in profit or loss for the period in which they are actually incurred.
Estimated useful lives and residual value of fixed assets and intangible assets
The Group assesses the estimated useful lives and residual value of fixed assets and intangible assets.Such estimate is made by reference to the historical experience of actual useful lives and residualvalue of fixed assets and intangible assets of similar nature and function, and is subject to significantchanges due to technical innovation and fierce industry competition. Where the estimated usefullives and residual value of fixed assets and intangible assets are less than the previous estimates,the Group will increase the depreciation and amortization, or write off or eliminate the technicallyobsolete fixed assets or intangible assets.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VI) CHANGES IN SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES
1. Changes in significant accounting policies
1.1 Interpretation No. 16 of the Accounting Standards for Business Enterprises
The Interpretation No. 16 of the Accounting Standards for Business Enterprises (the "InterpretationNo. 16") was issued by the Ministry of Finance on 30 November 2022, which clarified theaccounting treatment concerning the exemption of initial recognition of deferred income tax relatingto assets and liabilities arising from a single transaction.
Interpretation No. 16 revised the coverage of exemption of the initial recognition of deferred incometax in the Accounting Standards for Business Enterprises No. 18 – Income Tax, and specified thatthe relevant provisions on the exemption of initial recognition of deferred tax liabilities and deferredtax assets are not applicable to a single transaction (not a business combination) that affects neitherthe accounting profit nor taxable income (or deductible losses) at the time of transaction, and wherethe assets and liabilities initially recognized generate equal taxable temporary differences anddeductible temporary differences. The Interpretation became effective from 1 January 2023 andcould be early applied. The Group started to apply the Interpretation from 1 January 2023, adoptedthe retrospective adjustment method for accounting treatment, and restated the financial statementsfor the comparative year. The impacts are listed as follows:
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 1/1/2022 | Adjustment | 1/1/2022 |
| Assets: | |||
| Deferred tax assets | 398,145,710.84 | 56,499,013.55 | 454,644,724.39 |
| Liabilities: | |||
| Deferred tax liabilities | 4,550,417,470.61 | 2,001,049.09 | 4,552,418,519.70 |
| Shareholders' equity: | |||
| Unappropriated profit | 14,205,879,106.49 | 21,052,360.17 | 14,226,931,466.66 |
| Minority interests | 71,234,238,229.35 | 33,445,604.29 | 71,267,683,833.64 |
| Item | 31/12/2022 | Adjustment | 31/12/2022 |
| Assets: | |||
| Deferred tax assets | 372,927,261.40 | 61,571,559.55 | 434,498,820.95 |
| Liabilities: | |||
| Deferred tax liabilities | 4,853,271,307.86 | 1,748,527.47 | 4,855,019,835.33 |
| Shareholders' equity: | |||
| Other comprehensive income | -691,536,248.44 | 1,982,628.58 | -689,553,619.86 |
| Unappropriated profit | 16,679,688,347.09 | 22,299,954.05 | 16,701,988,301.14 |
| Minority interests | 73,994,641,893.21 | 35,540,449.45 | 74,030,182,342.66 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VI) CHANGES IN SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING
ESTIMATES - continued
1. Changes in significant accounting policies - continued
1.1 Interpretation No. 16 of the Accounting Standards for Business Enterprises - continued
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 2022 | Adjustment | 2022 |
| Profit and loss: | |||
| Income tax expenses | 1,113,179,679.35 | -220,002.60 | 1,112,959,676.75 |
| Net profit | 8,231,683,297.67 | 220,002.60 | 8,231,903,300.27 |
| Profit or loss attributable to minority shareholders | 4,894,237,074.85 | -1,027,591.28 | 4,893,209,483.57 |
| Other comprehensive income attributable to shareholders of the Company, net of tax | 206,102,739.65 | 1,982,628.58 | 208,085,368.23 |
| Other comprehensive income attributable to minority interests, net of tax | 1,417,424,133.35 | 3,122,436.44 | 1,420,546,569.79 |
(VII) TAXES
1. Major taxes and tax rates
| Taxes | Tax basis | Tax rate |
| Enterprise income tax | Taxable income | 8.25%-34% (Note 1) |
| Dividend income tax | 5%,10% (Note 2) | |
| Value-added tax ("VAT") (Note 3) | Income from sale of goods | 9%,13% |
| Income from transportation, loading and unloading business and part of modern service industries | 6% | |
| Income from sale of real estate, property management, lease of real estate, etc. | 3%, 5%, 9% | |
| Income from leases of movable properties | 13% | |
| Social contribution tax (Note 4) | Income | 0.65%-7.6% |
| Deed tax | Land use right and property transfer amount | 3%-5% |
| Property tax | 70% of cost of property or rental income | 1.2% or 12% |
| City maintenance and construction tax | VAT paid | 1%-7% |
| Education surtax | VAT paid | 3% |
| Land use tax | Land area actually occupied | RMB 1-12 per square meter |
| Environmental protection tax (Note 5) | Amount of pollution equivalents of the taxable air pollutants converted based on the quantity of pollutions discharged | RMB 1.8 per pollution equivalent |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VII) TAXES - continued
1. Major taxes and tax rates - continued
Note 1: The Group's enterprise income tax is calculated based on the current tax rate stipulated by
local tax laws. Among them, the Company is subject to an enterprise income tax rate of25%, the subsidiaries set up in Hong Kong are subject to an enterprise income tax rate of
8.25% and 16.5%, the majority of subsidiaries set up in China are subject to an enterpriseincome tax rate of 25% and certain others are subject to the preferential tax rate for smalland micro enterprises of 20%, certain domestic subsidiaries are subject to the preferentialtax rate for high-tech enterprises or encouraged industrial enterprises in the region of 15%,and the other overseas subsidiaries are subject to enterprise income tax rates between 10%and 34%.
The Company obtains dividends distributed by overseas subsidiaries and should payenterprise income tax at a rate of 25% in accordance with relevant Chinese tax laws. TheCompany obtains taxable income outside of China, and the amount of income tax that hasbeen paid abroad can be offset with the current taxable amount. The credit limit is thetaxable amount calculated in accordance with the provisions of the Enterprise Income TaxLaw.
Note 2: Foreign investors who receive dividends of profits from Chinese subsidiaries in 2008 and
thereafter generally shall pay withholding income tax at a rate of 10% in accordance withthe relevant provisions on the PRC enterprise income tax. For companies incorporated incertain regions (including Hong Kong and Singapore), if the companies are actual ownersholding more than 25% interest in the subsidiaries in China, they will enjoy a preferentialtax rate of 5%.
Note 3: The VAT amount is the balance of the output tax less the deductible input tax, and the
output tax is calculated in accordance with the sales income and the corresponding tax ratestipulated in the relevant tax laws of China.
Note 4: The social contribution tax is the tax paid by TCP Participa??es S.A. (hereinafter referred
to as "TCP"), an overseas subsidiary of the Group, to the local government.
Note 5: The environmental protection tax is the tax paid by Zhanjiang Port (Group) Co., Ltd.
(hereinafter referred to as "Zhanjiang Port"), a domestic subsidiary of the Group, to thegovernment.
2. Tax preference
Certain subsidiaries of the Group in China are recognized as high-tech enterprises or encouragedindustrial enterprises in the region and are subject to an enterprise income tax rate of 15%. TheGroup's subsidiaries outside of China may be subject to enterprise income tax preference inaccordance with relevant local tax policies.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VII) TAXES - continued
2. Tax preference - continued
From 1 January 2023 to 31 December 2027, the urban land use tax for certain domestic subsidiariesof the Group on the land for bulk commodity storage facilities is levied at the reduced rate of 50%of the tax amount applicable to the grade of the land.
Certain subsidiaries of the Group in China are small and micro enterprises and are subject to apreferential tax rate of 20%. In accordance with the Announcement on Relevant Tax and FeePolicies for Further Supporting the Development of Micro and Small Enterprises and IndividualIndustrial and Commercial Households (Announcement No. 12 of the Ministry of Finance and theState Administration of Taxation in 2023), for small and micro enterprises, the taxable income iscalculated at a reduced rate of 25% and the enterprise income tax is paid at a rate of 20% from 1January 2023 and 31 December 2027.
As approved by Shekou Taxation Sub-bureau of Shenzhen Tax Bureau, State Administration ofTaxation on 12 October 2017, certain subsidiaries of the Group are exempted from VAT forauxiliary logistics services (warehousing services, excluding delivery services) provided tooverseas enterprises in 2023.
(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS
1. Cash and bank balances
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 31/12/2023 | 31/12/2022 |
| Cash | 974,692.93 | 726,960.10 |
| Including: RMB | 2,767.60 | 2,767.60 |
| USD | 225,565.37 | 44,853.90 |
| HKD | 25,259.89 | 26,167.88 |
| BRL | 8,625.45 | 6,536.63 |
| Others | 712,474.62 | 646,634.09 |
| Bank deposits (Note 1) | 13,934,385,410.92 | 11,219,776,605.37 |
| Including: RMB | 8,215,456,953.08 | 8,846,763,966.57 |
| USD | 3,189,067,302.34 | 1,045,085,866.19 |
| EUR | 655,188,558.31 | 745,066,787.31 |
| BRL | 283,264,276.30 | 379,062,088.91 |
| HKD | 1,211,715,308.91 | 141,668,372.90 |
| AUD | 36,381,245.06 | 4,708,056.85 |
| FCFA | 295,232,843.14 | - |
| Others | 48,078,923.78 | 57,421,466.64 |
| Other cash and bank balances (Note 2) | 54,207,918.46 | 553,726,619.61 |
| Including: LKR | 39,287,209.66 | - |
| RMB | 14,920,544.77 | 340,778,819.19 |
| HKD | 164.03 | 212,571,712.02 |
| USD | - | 376,088.40 |
| Funds deposited in Finance Company (Note 3) | 2,090,078,155.93 | 1,841,698,554.32 |
| Total | 16,079,646,178.24 | 13,615,928,739.40 |
| Including: Total amount of funds deposited overseas | 4,143,910,318.92 | 4,012,922,744.09 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
1. Cash and bank balances - continued
Note 1: The interest receivable and funds frozen for ETC card business which are included in the
balance of bank deposits at the end of the year amounted to RMB 13,563,157.74 and RMB12,000.00, respectively.
Note 2: The funds frozen for litigation, the balance of the securities account, the restricted banker's
letter of guarantee, and the restricted performance bond, which are included in the balanceof other cash and bank balances at the end of the year, amounted to RMB 1,826,085.98,RMB 7,684,462.32, RMB 4,214,480.40, RMB 40,482,889.76.
Note 3: The funds deposited in Finance Company included the interest receivable amounting to
RMB 933,933.26.
2. Held-for-trading financial assets
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 31/12/2023 | 31/12/2022 |
| Financial assets classified as at FVTPL | 4,568,806,108.84 | 2,998,781,599.63 |
| Including: Investments in debt instruments | 450,209.48 | - |
| Investments in equity investments | - | 135,742.11 |
| Structured deposits | 4,568,355,899.36 | 2,998,645,857.52 |
| Total | 4,568,806,108.84 | 2,998,781,599.63 |
3. Notes receivable
(1) Category of notes receivable
| Category | 31/12/2023 | 31/12/2022 |
| Bank acceptance | 315,150,195.09 | 395,000.00 |
| Commercial acceptance | 10,000,000.00 | 36,000,000.00 |
| Total | 325,150,195.09 | 36,395,000.00 |
Note: In 2023, no provision for bad debts of notes receivable is assessed on an individual basis
and, the acceptor of bank acceptance and commercial acceptance for which provision forbad debts is assessed on a portfolio basis has high credit ratings with no significant creditrisks, therefore, no provision for bad debts is made.
(2) As at 31 December 2023, the Group has no notes receivable pledged.
(3) As at 31 December 2023, the Group has no endorsed or discounted and not yet matured
notes receivable at the balance sheet date.
(4) The Group has no notes receivable written off in 2023.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
4. Accounts receivable
(1) Overall situation of accounts receivable
CHINA MERCHANTS PORT GROUP CO., LTD.Category
| Category | 31/12/2023 | 31/12/2022 |
| Accounts receivable | 1,194,923,829.34 | 1,370,162,956.88 |
| Les: provision for credit loss | 91,022,363.09 | 94,013,267.44 |
| Total | 1,103,901,466.25 | 1,276,149,689.44 |
(2) Aging analysis of accounts receivable
| Aging | 31/12/2023 | 31/12/2022 |
| Within 1 year | 1,112,613,215.99 | 1,296,002,000.92 |
| 1-2 years | 23,735,983.67 | 11,157,744.62 |
| 2-3 years | 3,139,299.76 | 10,897,749.26 |
| More than 3 years | 55,435,329.92 | 52,105,462.08 |
| Total | 1,194,923,829.34 | 1,370,162,956.88 |
(3) Disclosure of accounts receivable by category
| Credit rating | Expected credit loss rate (%) | 31/12/2023 | 31/12/2022 | ||||
| Gross carrying amount | Bad debt provision | Carrying amount | Gross carrying amount | Bad debt provision | Carrying amount | ||
| A | 0.00-0.10 | 622,585,699.82 | 428,822.70 | 622,156,877.12 | 757,893,845.42 | 254,506.65 | 757,639,338.77 |
| B | 0.10-0.30 | 428,914,672.70 | 552,173.90 | 428,362,498.80 | 437,329,923.88 | 579,435.66 | 436,750,488.22 |
| C | 0.30-50.00 | 62,942,396.67 | 9,638,519.30 | 53,303,877.37 | 91,915,183.34 | 12,581,359.16 | 79,333,824.18 |
| D | 50.00-100.00 | 80,481,060.15 | 80,402,847.19 | 78,212.96 | 83,024,004.24 | 80,597,965.97 | 2,426,038.27 |
| Total | -- | 1,194,923,829.34 | 91,022,363.09 | 1,103,901,466.25 | 1,370,162,956.88 | 94,013,267.44 | 1,276,149,689.44 |
(4) Accounts receivable disclosed by method of bad debt provision:
| Category | 31 December 2023 | 31 December 2022 | ||||||||
| Gross carrying amount | Bad debt provision | Carrying amount | Gross carrying amount | Bad debt provision | Carrying amount | |||||
| Amount | Proportion (%) | Amount | Proportion (%) | Amount | Proportion (%) | Amount | Proportion (%) | |||
| Bad debt provision assessed on an individual basis | 80,481,060.15 | 6.74 | 80,402,847.19 | 99.90 | 78,212.96 | 83,024,004.24 | 6.06 | 80,597,965.97 | 97.08 | 2,426,038.27 |
| Bad debt provision assessed on a portfolio basis | 1,114,442,769.19 | 93.26 | 10,619,515.90 | 0.95 | 1,103,823,253.29 | 1,287,138,952.64 | 93.94 | 13,415,301.47 | 1.04 | 1,273,723,651.17 |
| Total | 1,194,923,829.34 | 100.00 | 91,022,363.09 | — — | 1,103,901,466.25 | 1,370,162,956.88 | 100.00 | 94,013,267.44 | — — | 1,276,149,689.44 |
Bad debt provision assessed on an individual basis:
| Name | 31 December 2023 | Reason for provision | ||
| Gross carrying amount | Bad debt provision | Proportion (%) | ||
| Entity 1 | 24,908,308.44 | 24,908,308.44 | 100.00 | Low probability of recovery |
| Entity 2 | 15,228,816.61 | 15,150,603.67 | 99.49 | Low probability of recovery |
| Entity 3 | 7,693,327.33 | 7,693,327.33 | 100.00 | Low probability of recovery |
| Entity 4 | 6,169,500.45 | 6,169,500.45 | 100.00 | Low probability of recovery |
| Entity 5 | 5,923,278.20 | 5,923,278.20 | 100.00 | Low probability of recovery |
| Others | 20,557,829.12 | 20,557,829.10 | 100.00 | Low probability of recovery |
| Total | 80,481,060.15 | 80,402,847.19 | — — | — — |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
4. Accounts receivable - continued
(4) Accounts receivable disclosed by method of bad debt provision: - continued
Bad debt provision assessed on a portfolio basis:
CHINA MERCHANTS PORT GROUP CO., LTD.
Name
| Name | 31 December 2023 | ||
| Accounts receivable | Bad debt provision | Proportion (%) | |
| A | 622,585,699.82 | 428,822.70 | 0.07 |
| B | 428,914,672.70 | 552,173.90 | 0.13 |
| C | 62,942,396.67 | 9,638,519.30 | 15.31 |
| Total | 1,114,442,769.19 | 10,619,515.90 | — — |
(5) Measurement of expected credit loss at an amount equivalent to the lifetime expected credit
loss
| Item | Lifetime expected credit loss (not credit-impaired) | Lifetime expected credit loss (credit-impaired) | Total |
| At 1 January 2023 | 13,415,301.47 | 80,597,965.97 | 94,013,267.44 |
| Gross carrying amount of accounts receivable at 1 January 2023 | |||
| - Transfer to credit-impaired accounts receivable | - | - | - |
| - Reversal of accounts receivable that are not credit-impaired | - | - | - |
| Provision for the year | 3,361,539.37 | 17,614,537.42 | 20,976,076.79 |
| Reversal for the year | -5,995,730.86 | -5,694,956.74 | -11,690,687.60 |
| Effect of changes in the scope of consolidation | - | -5,662,552.89 | -5,662,552.89 |
| Transfer-out due to derecognition of financial assets (including direct write-down) | - | -8,087,700.00 | -8,087,700.00 |
| Other changes | -161,594.08 | 1,635,553.43 | 1,473,959.35 |
| At 31 December 2023 | 10,619,515.90 | 80,402,847.19 | 91,022,363.09 |
(6) Details of bad debt provision
| Category | 31/12/2022 | Changes for the year | 31/12/2023 | ||||
| Provision | Recovery or reversal | Effect of changes in the scope of consolidation | Charge-off or write-off | Other changes | |||
| Bad debt provision assessed on an individual basis | 80,597,965.97 | 17,614,537.42 | -5,694,956.74 | -5,662,552.89 | -8,087,700.00 | 1,635,553.43 | 80,402,847.19 |
| Bad debt provision assessed on a portfolio basis | 13,415,301.47 | 3,361,539.37 | -5,995,730.86 | - | - | -161,594.08 | 10,619,515.90 |
| Total | 94,013,267.44 | 20,976,076.79 | -11,690,687.60 | -5,662,552.89 | -8,087,700.00 | 1,473,959.35 | 91,022,363.09 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
4. Accounts receivable - continued
(7) Accounts receivable written off in the year
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Nature | Amount | Reason for write-off | Procedures performed | Arising from related party transactions or not |
| Entity A | Service fees | 8,087,700.00 | Confirmed as irrecoverable | Yes | No |
| Total | — — | 8,087,700.00 | — — | — — | — — |
(8) The top five balances of accounts receivable at the end of the year classified by debtor
| Name of entity | Relationship with the Group | 31/12/2023 | Aging | Proportion of the amount to the total accounts receivable (%) | Bad debt provision at 31/12/2023 |
| Client 1 | Non-related party | 259,396,393.45 | Within 1 year, 1-2 years | 21.71 | 30,325.21 |
| Client 2 | Non-related party | 68,403,654.05 | Within 1 year | 5.72 | 54,946.81 |
| Client 3 | Non-related party | 43,464,824.09 | Within 1 year, 1-2 years | 3.64 | 7,510.99 |
| Client 4 | Non-related party | 29,747,677.62 | Within 1 year | 2.49 | 7,909.61 |
| Client 5 | Non-related party | 29,355,671.89 | Within 1 year | 2.46 | - |
| Total | 430,368,221.10 | 36.02 | 100,692.62 |
5. Receivables financing
(1) Classification of receivables financing
| Item | 31/12/2023 | 31/12/2022 |
| Bank acceptance measured at fair value | 2,001,669.46 | 163,766,913.10 |
(2) As at 31 December 2023, the Group has no pledged receivables financing.
(3) At the end of the year, the Company's receivables financing that have been endorsed or
discounted and have not yet matured at the balance sheet date are as follows:
| Item | Amount derecognized at the end of the year | Amount not derecognized at the end of the year |
| Bank acceptance measured at fair value | 16,291,826.66 | - |
| Total | 16,291,826.66 | - |
(4) In 2023, no provision for bad debt of receivables financing is assessed on an individual basis
and, the acceptor of bank acceptance for which provision for bad debts is assessed on aportfolio basis has high credit ratings with no significant credit risks, therefore, no provisionfor credit loss is made.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
6. Prepayments
(1) Aging analysis of prepayments
CHINA MERCHANTS PORT GROUP CO., LTD.
Aging
| Aging | 31/12/2023 | 31/12/2022 | ||||
| Gross carrying amount | Proportion (%) | Impairment provision | Gross carrying amount | Proportion (%) | Impairment provision | |
| Within 1 year (inclusive) | 36,798,888.01 | 97.70 | - | 61,917,391.43 | 97.31 | - |
| 1-2 years (inclusive) | 615,427.75 | 1.63 | - | 1,589,158.49 | 2.50 | - |
| 2-3 years (inclusive) | 129,361.04 | 0.34 | - | - | - | - |
| More than 3 years | 120,875.50 | 0.33 | - | 120,875.50 | 0.19 | - |
| Total | 37,664,552.30 | 100.00 | - | 63,627,425.42 | 100.00 | - |
(2) As at 31 December 2023, the Group has no significant prepayments aged more than one
year.
(3) The top five balances of prepayments at the end of the year classified by entities
| Name of entity | Relationship with the Company | 31/12/2023 | Aging | Proportion of the closing balance to the total prepayments (%) | Reason for not being settled |
| Entity 1 | Non-related party | 14,057,775.95 | Within 1 year | 37.32 | Unsettled prepayment for premium |
| Entity 2 | Non-related party | 6,591,641.10 | Within 1 year, 1-2 years, and 2-3 years | 17.50 | Unsettled prepayment for communication charges |
| Entity 3 | Non-related party | 2,298,659.10 | Within 1 year | 6.10 | Unsettled prepayment for premium |
| Entity 4 | Non-related party | 743,362.83 | Within 1 year | 1.97 | Unsettled prepayment for procurement |
| Entity 5 | Non-related party | 641,646.87 | Within 1 year | 1.70 | Unsettled prepayment for procurement |
| Total | 24,333,085.85 | 64.59 |
7. Other receivables
7.1 Presentation of other receivables
| Item | 31/12/2023 | 31/12/2022 |
| Dividends receivable | 343,386,866.06 | 416,040,485.62 |
| Other receivables | 596,628,127.95 | 532,801,608.68 |
| Total | 940,014,994.01 | 948,842,094.30 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
7. Other receivables - continued
7.2 Dividends receivable
(1) Presentation of dividends receivable
CHINA MERCHANTS PORT GROUP CO., LTD.Name of investee
| Name of investee | 31/12/2023 | 31/12/2022 |
| China Nanshan Development (Group) Incorporation ("Nanshan Group") | 203,577,000.00 | 240,591,000.00 |
| Zhanjiang Merchants Port City Investment Co., Ltd. ("Merchants Port City") | 38,809,044.77 | 41,847,044.77 |
| Dalian Port Logistics Network Co., Ltd. | 30,605,256.76 | - |
| Yingkou Gangxin Technology Co., Ltd. | 23,881,213.75 | - |
| COSCO Logistics (Zhanjiang) Co., Ltd. | 13,449,001.16 | 18,449,001.16 |
| China Ocean Shipping Agency (Shenzhen) Co., Ltd. | 11,232,000.00 | - |
| Tin-can Island Container Terminal Ltd | 21,960,680.22 | 65,121,449.40 |
| Qingdao Qianwan United Container Terminal Co., Ltd. | - | 50,000,000.00 |
| Others | 216,400.00 | 448,447.23 |
| Sub-total | 343,730,596.66 | 416,456,942.56 |
| Less: Bad debt provision | 343,730.60 | 416,456.94 |
| Carrying amount | 343,386,866.06 | 416,040,485.62 |
(2) Significant dividends receivable aged more than 1 year
| Name of investee | 31/12/2023 | 31/12/2022 | Aging | Reason for not being recovered | Whether bad debts have been incurred and the basis for determination |
| Nanshan Group | 129,549,000.00 | 111,042,000.00 | 1-2 years | Undergoing relevant formalities, expected to be recovered by the end of 2024 | No |
(3) Changes in provision for credit loss of dividends receivable
| Item | Stage 1 | Stage 2 | Stage 3 | Total |
| 12-month expected credit loss | Lifetime expected credit loss (not credit-impaired) | Lifetime expected credit loss (credit-impaired) | ||
| At 1 January 2023 | 416,456.94 | - | - | 416,456.94 |
| Balance at 1 January 2023 | ||||
| - Transfer to Stage 2 | - | - | - | - |
| - Transfer to Stage 3 | - | - | - | - |
| - Reverse to Stage 2 | - | - | - | - |
| - Reverse to Stage 1 | - | - | - | - |
| Provision for the year | - | - | - | - |
| Reversal for the year | -72,726.34 | - | - | -72,726.34 |
| Transfer-out due to derecognition of financial assets (including direct write-down) | - | - | - | - |
| Other changes | - | - | - | - |
| At 31 December 2023 | 343,730.60 | - | - | 343,730.60 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
7. Other receivables - continued
7.2 Dividends receivable - continued
(4) Details of bad debt provision
CHINA MERCHANTS PORT GROUP CO., LTD.
Category
| Category | 31/12/2022 | Changes for the year | 31/12/2023 | |||
| Provision | Recovery or reversal | Charge-off or write-off | Other changes | |||
| Bad debt provision assessed on an individual basis | - | - | - | - | - | - |
| Bad debt provision assessed on a portfolio basis | 416,456.94 | - | -72,726.34 | - | - | 343,730.60 |
| Total | 416,456.94 | - | -72,726.34 | - | - | 343,730.60 |
7.3 Other receivables
(1) Aging analysis of other receivables
| Aging | 31/12/2023 | 31/12/2022 | ||||
| Other receivables | Bad debt provision | Proportion (%) | Other receivables | Bad debt provision | Proportion (%) | |
| Within 1 year | 261,380,065.65 | 3,386,613.18 | 1.30 | 487,428,214.83 | 229,150,234.71 | 47.01 |
| 1-2 years | 268,634,561.16 | 189,669,720.48 | 70.61 | 192,100,283.58 | 4,690,780.38 | 2.44 |
| 2-3 years | 189,029,374.18 | 4,675,136.05 | 2.47 | 12,444,128.52 | 9,740,862.33 | 78.28 |
| More than 3 years | 834,322,127.22 | 759,006,530.55 | 90.97 | 844,098,122.57 | 759,687,263.40 | 90.00 |
| Total | 1,553,366,128.21 | 956,738,000.26 | 1,536,070,749.50 | 1,003,269,140.82 | ||
(2) Disclosure of other receivables by nature
| Item | 31/12/2023 | 31/12/2022 |
| Operation compensation (Note 1) | 857,551,782.45 | 859,677,826.43 |
| Advance payments | 264,603,548.43 | 295,592,304.09 |
| Land compensation (Note 2) | 89,630,000.00 | 89,630,000.00 |
| Guarantees and deposits | 24,853,374.42 | 26,402,747.81 |
| Special subsidy | 24,800,000.00 | 31,716,257.00 |
| Others | 291,927,422.91 | 233,051,614.17 |
| Sub-total | 1,553,366,128.21 | 1,536,070,749.50 |
| Less: Bad debt provision | 956,738,000.26 | 1,003,269,140.82 |
| Total | 596,628,127.95 | 532,801,608.68 |
Note 1: It represents the operation compensation receivable by a subsidiary of the Company
from the holding company of its minority shareholder in accordance with the agreement.As at 31 December 2023, a bad debt provision has been made for the accumulatedoutstanding compensation amounting to RMB 857,551,782.45.
Note 2: On 9 October 2021, Zhanjiang Port, a subsidiary of the Company, entered into the
Agreement on Recovery of State-owned Land Use Rights with the local government.Pursuant to the Agreement, Zhanjiang Port shall return the land of approximately 195.68mu located in Zhanjiang Comprehensive Bonded Zone on the east of Shugang Avenue,which is amounting to RMB 89,630,000.00. The above-mentioned land has beenreturned before 31 December 2021. As at 31 December 2023, the above-mentioned landcompensation of RMB 89,630,000.00 has not been recovered yet.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
7. Other receivables - continued
7.3 Other receivables - continued
(3) Provision for credit loss of other receivables
CHINA MERCHANTS PORT GROUP CO., LTD.
Credit rating
| Credit rating | Expected credit loss rate (%) | 31/12/2023 | 31/12/2022 | ||||||
| 12-month expected credit loss | Lifetime expected credit loss (not credit-impaired) | Lifetime expected credit loss (credit-impaired) | Total | 12-month expected credit loss | Lifetime expected credit loss (not credit-impaired) | Lifetime expected credit loss (credit-impaired) | Total | ||
| A | 0.00-0.10 | 596,631,116.95 | - | - | 596,631,116.95 | 532,760,873.61 | - | - | 532,760,873.61 |
| B | 0.10-0.30 | - | - | - | - | - | - | - | - |
| C | 0.30-50.00 | - | - | - | - | - | - | - | - |
| D | 50.00-100.00 | - | - | 956,735,011.26 | 956,735,011.26 | - | - | 1,003,309,875.89 | 1,003,309,875.89 |
| Gross carrying amount | —— | 596,631,116.95 | - | 956,735,011.26 | 1,553,366,128.21 | 532,760,873.61 | - | 1,003,309,875.89 | 1,536,070,749.50 |
| Bad debt provision | —— | 2,989.00 | - | 956,735,011.26 | 956,738,000.26 | 24,451.35 | - | 1,003,244,689.47 | 1,003,269,140.82 |
| Carrying amount | —— | 596,628,127.95 | - | - | 596,628,127.95 | 532,736,422.26 | - | 65,186.42 | 532,801,608.68 |
Significant other receivables for which bad debt provision is assessed on an individual basis (credit rating of D)
| Name | 31/12/2023 | Bad debt provision | ECL rate (%) | Reason for provision |
| Entity 1 | 857,551,782.45 | 857,551,782.45 | 100.00 | Expected to be unrecoverable (Note) |
| Entity 2 | 64,841,250.09 | 64,841,250.09 | 100.00 | Expected to be unrecoverable |
| Entity 3 | 14,000,000.00 | 14,000,000.00 | 100.00 | Expected to be unrecoverable |
| Others | 20,341,978.72 | 20,341,978.72 | 100.00 | Expected to be unrecoverable |
| Total | 956,735,011.26 | 956,735,011.26 | — — | — — |
Note: Refer to Note (VIII) 7.3(2).
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
7. Other receivables - continued
7.3 Other receivables - continued
(4) Provision, reversal and write-off of credit loss of other receivables
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Stage 1 | Stage 2 | Stage 3 | Total |
| 12-month expected credit loss | Lifetime expected credit loss (not credit-impaired) | Lifetime expected credit loss (credit-impaired) | ||
| At 1 January 2023 | 24,451.35 | - | 1,003,244,689.47 | 1,003,269,140.82 |
| Balance of other receivables at 1 January 2023 | ||||
| - Transfer to Stage 2 | - | - | - | - |
| - Transfer to Stage 3 | - | - | - | - |
| - Reverse to Stage 2 | - | - | - | - |
| - Reverse to Stage 1 | 6,000.00 | - | -6,000.00 | - |
| Provision for the year | 36,129.03 | - | 3,459,687.18 | 3,495,816.21 |
| Reversal for the year | -27,462.35 | - | -47,267,828.40 | -47,295,290.75 |
| Effect of changes in the scope of consolidation | -36,129.03 | - | -545,545.45 | -581,674.48 |
| Charge-off for the year | - | - | - | - |
| Write-off for the year | - | - | -73,074.00 | -73,074.00 |
| Other changes | - | - | -2,076,917.54 | -2,076,917.54 |
| At 31 December 2023 | 2,989.00 | - | 956,735,011.26 | 956,738,000.26 |
(5) Details of bad debt provision
| Category | 01/01/2023 | Changes for the year | 31/12/2023 | ||||
| Provision | Recovery or reversal | Effect of changes in the scope of consolidation | Charge-off or write-off | Other changes | |||
| Bad debt provision assessed on an individual basis | 1,003,244,689.47 | 3,459,687.18 | -47,273,828.40 | -545,545.45 | -73,074.00 | -2,076,917.54 | 956,735,011.26 |
| Bad debt provision assessed on a portfolio basis | 24,451.35 | 36,129.03 | -21,462.35 | -36,129.03 | - | - | 2,989.00 |
| Total | 1,003,269,140.82 | 3,495,816.21 | -47,295,290.75 | -581,674.48 | -73,074.00 | -2,076,917.54 | 956,738,000.26 |
Among which, the bad debt provision recovered or reversed for the period that is significant inamount is listed as below:
| Name | Amount recovered or reversed | Reason for retrieve | Recovered through | Basis to determine the original proportion of bad debt provision and its reasonableness |
| Entity 4 | 47,169,811.32 | Improvement in debtor's operations | Cash | Based on prior years' financial position |
| Total | 47,169,811.32 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
7. Other receivables - continued
7.3 Other receivables - continued
(6) Write-off of other receivables in the year
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | Nature | Amount | Reason for write-off | Procedures performed | Arising from related party transactions or not |
| Entity 5 | Rents receivable | 73,074.00 | The counterparty was unable to make payments | Write-off upon approval | No |
| Total | — — | 73,074.00 | — — | — — | — — |
(7) The top five balances of other receivables at the end of the year classified by debtor
| Name of entity | Relationship with the Group | Nature | 31/12/2023 | Aging | Proportion to total other receivables (%) | Closing balance of provision for credit loss |
| Entity 1 | Non-related party | Operation compensation | 857,551,782.45 | Within 1 year, more than 3 years | 55.21 | 857,551,782.45 |
| Entity 2 | Non-related party | Advance payments | 122,674,255.48 | Within 1 year, 1-2 years, 2-3 years | 7.90 | - |
| Entity 3 | Non-related party | Land compensation | 89,630,000.00 | 2-3 years | 5.77 | - |
| Entity 4 | Non-related party | Advance payments | 64,841,250.09 | Within 1 year, 1-2 years, 2-3 years, more than 3 years | 4.17 | 64,841,250.09 |
| Entity 5 | Non-related party | Advance payments | 59,698,841.66 | Within 1 year | 3.84 | - |
| Total | — — | — — | 1,194,396,129.68 | — — | 76.89 | 922,393,032.54 |
8. Inventories
(1) Category of inventories
| Item | 31/12/2023 | 31/12/2022 | ||||
| Gross carrying amount | Provision for decline in value of inventories | Carrying amount | Gross carrying amount | Provision for decline in value of inventories | Carrying amount | |
| Raw materials | 217,097,512.98 | 1,234,628.38 | 215,862,884.60 | 196,425,573.04 | 1,326,130.64 | 195,099,442.40 |
| Finished goods | 2,520,205.91 | - | 2,520,205.91 | 17,248,970.37 | - | 17,248,970.37 |
| Others | 515,102.36 | - | 515,102.36 | 12,774,408.71 | - | 12,774,408.71 |
| Total | 220,132,821.25 | 1,234,628.38 | 218,898,192.87 | 226,448,952.12 | 1,326,130.64 | 225,122,821.48 |
(2) Provision for decline in value of inventories
| Category | 1/1/2023 | Increase | Decrease | Effect of translation of financial statements denominated in foreign currencies | 31/12/2023 | ||
| Provision | Others | Reversal or charge-off | Others | ||||
| Raw materials | 1,326,130.64 | - | - | 99,456.13 | - | 7,953.87 | 1,234,628.38 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
8. Inventories - continued
(2) Provision for decline in value of inventories - continued
Provision for decline in value of inventories is made on an item-by-item basis and no provision fordecline in value of inventories is made on a portfolio basis. Provision for decline in value ofinventories is reversed in the current year due to the rebound in value of inventories.
(3) As at 31 December 2023, the Group has no capitalized borrowing cost in the balance of
inventories.
9. Non-current assets due within one year
(1) Presentation of non-current assets due within one year
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 31/12/2023 | 31/12/2022 |
| Long-term receivables due within one year | 17,468,849.83 | 903,128,422.35 |
| Less: Bad debt provision | 17,468.85 | 903,128.42 |
| Carrying amount | 17,451,380.98 | 902,225,293.93 |
(2) Provision for bad debts
| Item | Stage 1 | Stage 2 | Stage 3 | Total |
| 12-month expected credit loss | Lifetime expected credit loss (not credit-impaired) | Lifetime expected credit loss (credit-impaired) | ||
| At 1 January 2023 | 903,128.42 | - | - | 903,128.42 |
| Gross carrying amount of long-term receivables at 1 January 2023 | ||||
| - Transfer to Stage 2 | - | - | - | - |
| - Transfer to Stage 3 | - | - | - | - |
| - Reverse to Stage 2 | - | - | - | - |
| - Reverse to Stage 1 | - | - | - | - |
| Provision for the year | 6,200.00 | - | - | 6,200.00 |
| Reversal for the year | -891,859.57 | - | - | -891,859.57 |
| Transfer-out due to derecognition of financial assets (including direct write-down) | - | - | - | - |
| Other changes | - | - | - | - |
| At 31 December 2023 | 17,468.85 | - | - | 17,468.85 |
(3) Details of bad debt provision
| Category | 31/12/2022 | Changes for the year | 31/12/2023 | |||
| Provision | Recovery or reversal | Charge-off or write-off | Other changes | |||
| Bad debt provision assessed on a portfolio basis | 903,128.42 | 6,200.00 | -891,859.57 | - | - | 17,468.85 |
| Total | 903,128.42 | 6,200.00 | -891,859.57 | - | - | 17,468.85 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
10. Other current assets
(1) Category of other current assets
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 31/12/2023 | 31/12/2022 |
| Input tax to be deducted and certified | 115,121,766.13 | 70,627,183.33 |
| Prepaid taxes | 71,771,659.09 | 98,329,205.73 |
| Others | 2,780,075.65 | 16,946,751.47 |
| Total | 189,673,500.87 | 185,903,140.53 |
11. Long-term receivables
(1) Details of long-term receivables
| Item | 31/12/2023 | 31/12/2022 | Range of discount rate at the end of year | ||||
| Gross carrying amount | Bad debt provision | Carrying amount | Gross carrying amount | Bad debt provision | Carrying amount | ||
| Advances to shareholders (Note 1) | 1,167,470,819.35 | 1,167,470.82 | 1,166,303,348.53 | 3,864,736,673.31 | 3,864,736.67 | 3,860,871,936.64 | 3.65%-8.50% |
| Guarantees for finance leases | 10,695,876.01 | 10,695.88 | 10,685,180.13 | 10,659,515.88 | 10,659.52 | 10,648,856.36 | 0-5.37% |
| Land compensation receivable (Note 2) | 2,691,932,000.00 | - | 2,691,932,000.00 | 2,692,032,000.00 | - | 2,692,032,000.00 | - |
| Others | 4,996,969.31 | - | 4,996,969.31 | - | - | - | - |
| Total | 3,875,095,664.67 | 1,178,166.70 | 3,873,917,497.97 | 6,567,428,189.19 | 3,875,396.19 | 6,563,552,793.00 | - |
| Less: Long-term receivables due within 1 year | 17,468,849.83 | 17,468.85 | 17,451,380.98 | 903,128,422.35 | 903,128.42 | 902,225,293.93 | - |
| Long-term receivables due after 1 year | 3,857,626,814.84 | 1,160,697.85 | 3,856,466,116.99 | 5,664,299,766.84 | 2,972,267.77 | 5,661,327,499.07 | - |
Note 1: It mainly represents the aggregate principal and interest receivable from Port of Newcastle
and Terminal Link SAS, equivalent to RMB 921,402,438.00 and 211,768,361.35,respectively.
On 14 June 2018, China Merchants Port Holdings Company ("CM Port"), a subsidiary ofthe Company, provided a long-term loan to Port of Newcastle, which matures in 2023 andhas been extended to 31 December 2034 as stipulated in an agreement entered into duringthe year. The loan carries interest at a rate of weighted average interest rate on debt asdetermined by local authority of Port of Newcastle plus 0.5%.
On 31 May 2023, CM Port, a subsidiary of the Company, provided a long-term loan toTerminal Link SAS for making additional capital injection to Saigang project and chargedinterest to Terminal Link SAS at an interest rate of 6.15%.
Note 2: On 5 November 2019, Shantou CM Port Group Co., Ltd. ("Shantou Port") entered into
the Contract for the Acquisition of State-Owned Land Use Rights in Shantou with ShantouLand Reserve Center. Pursuant to the contract, the land and attached buildings ofapproximately 370.96 mu located in Zhuchi Deepwater Port on the south of ZhongshanEast Road of Shantou should be returned to Shantou Land Reserve Center by ShantouPort, which is amounting to RMB1,558,032,000.00. Among them, 183.63 mu of land andattached buildings have been transferred in 2019, and the remaining 187.33 mu of landand attached buildings have been transferred in 2020. As at 31 December 2023, the landcompensation totalling RMB1,158,032,000.00 has not yet been recovered.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
11. Long-term receivables - continued
(1) Details of long-term receivables - continued
Note 2: - continued
On 21 August 2020, Shantou Port entered into the Contract for the Acquisition of State-Owned Land Use Rights in Shantou with Land Reserve Center of Shantou HaojiangDistrict. Pursuant to the contract, the land and attached buildings of approximately 152.34mu located in Yutianwen, Queshi, Haojiang District, Shantou, should be returned to LandReserve Center of Shantou Haojiang District by Shantou Port, which is amounting toRMB250,000,000.00. The transfer of above-mentioned land and attached buildings wascompleted before 31 December 2020. As at 31 December 2023, the land compensationtotalling RMB200,000,000.00 has not yet been recovered.
On 22 December 2020, Shantou Port entered into the Contract for the Acquisition of State-Owned Land Use Rights in Shantou with Shantou Land Reserve Center. Pursuant to thecontract, the land and attached buildings of approximately 648.78 mu located in ZhuchiDeepwater Port of Shantou should be returned to Shantou Land Reserve Center byShantou Port, which is amounting to RMB2,724,876,000.00. Among them, 320 mu ofland and attached buildings were transferred by 31 December 2020, which is amountingto RMB1,344,000,000.00, and the remaining 328.78 mu of land and attached buildingshave not been transferred. As at 31 December 2023, the land compensation totalling RMB1,333,900,000.00 has not yet been recovered.
(2) Long-term receivables disclosed by method of bad debt provision
CHINA MERCHANTS PORT GROUP CO., LTD.Category
| Category | 31 December 2023 | 31 December 2022 | ||||||||
| Gross carrying amount | Bad debt provision | Carrying amount | Gross carrying amount | Bad debt provision | Carrying amount | |||||
| Amount | Proportion (%) | Amount | Proportion (%) | Amount | Proportion (%) | Amount | Proportion (%) | |||
| Bad debt provision assessed on a portfolio basis | 3,875,095,664.67 | 100.00 | 1,178,166.70 | 0.03 | 3,873,917,497.97 | 6,567,428,189.19 | 100.00 | 3,875,396.19 | 0.06 | 6,563,552,793.00 |
| Total | 3,875,095,664.67 | 100.00 | 1,178,166.70 | — — | 3,873,917,497.97 | 6,567,428,189.19 | 100.00 | 3,875,396.19 | — — | 6,563,552,793.00 |
Bad debt provision assessed on a portfolio basis
| Name | 31 December 2023 | ||
| Accounts receivable | Bad debt provision | Proportion (%) | |
| A | 3,875,095,664.67 | 1,178,166.70 | 0.03 |
| Total | 3,875,095,664.67 | 1,178,166.70 | — — |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
11. Long-term receivables - continued
(3) Provision for credit loss of long-term receivables
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Stage 1 | Stage 2 | Stage 3 | Total |
| 12-month expected credit loss | Lifetime expected credit loss (not credit-impaired) | Lifetime expected credit loss (credit-impaired) | ||
| At 1 January 2023 | 3,875,396.19 | - | - | 3,875,396.19 |
| Gross carrying amount of long-term receivables at 1 January 2023 | ||||
| - Transfer to Stage 2 | - | - | - | - |
| - Transfer to Stage 3 | - | - | - | - |
| - Reverse to Stage 2 | - | - | - | - |
| - Reverse to Stage 1 | - | - | - | - |
| Provision for the year | 921,438.82 | - | - | 921,438.82 |
| Reversal for the year | -3,618,668.31 | - | - | -3,618,668.31 |
| Charge-off for the year | - | - | - | - |
| Write-off for the year | - | - | - | - |
| Other changes | - | - | - | - |
| At 31 December 2023 | 1,178,166.70 | - | 1,178,166.70 | |
(4) Details of bad debt provision
| Category | 1/1/2023 | Changes for the year | 31/12/2023 | |||
| Provision | Recovery or reversal | Charge-off or write-off | Effect of changes in the scope of consolidation | |||
| Advances to shareholders | 3,864,736.67 | 921,402.46 | -3,618,668.31 | - | - | 1,167,470.82 |
| Guarantees for finance leases | 10,659.52 | 36.36 | - | - | - | 10,695.88 |
| Land compensation receivable | - | - | - | - | - | - |
| Others | - | - | - | - | - | - |
| Total | 3,875,396.19 | 921,438.82 | -3,618,668.31 | - | - | 1,178,166.70 |
(5) There are no long-term receivables written off during the year.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
12. Long-term equity investments
(1) Details of long-term equity investments
CHINA MERCHANTS PORT GROUP CO., LTD.
Investees
| Investees | Accounting method | 31/12/2022 | Changes for the year | 31/12/2023 | Closing balance of provision for impairment | ||||||||
| Increase | Decrease | Investment income under equity method | Reconciliation of other comprehensive income | Other equity movements | Cash dividends or profits declared | Others | Provision for impairment | Effect of translation of financial statements denominated in foreign currencies | |||||
| I. Joint ventures | |||||||||||||
| Euro-Asia Oceangate S.à r.l. | Equity method | 2,787,204,745.37 | - | - | 186,208,262.73 | -847,649,041.64 | - | -123,177,188.28 | - | - | 43,254,636.78 | 2,045,841,414.96 | - |
| Port of Newcastle | Equity method | 2,048,681,775.65 | - | - | -10,864,327.20 | -22,300,558.83 | - | - | - | - | 59,506,810.29 | 2,075,023,699.91 | - |
| Others | Equity method | 4,880,906,534.70 | 5,720,923.74 | -33,913,627.22 | 221,260,745.53 | -9,322,791.00 | -1,228,997.17 | -239,356,160.34 | - | - | 13,061,592.11 | 4,837,128,220.35 | - |
| Sub-total | 9,716,793,055.72 | 5,720,923.74 | -33,913,627.22 | 396,604,681.06 | -879,272,391.47 | -1,228,997.17 | -362,533,348.62 | - | - | 115,823,039.18 | 8,957,993,335.22 | - | |
| II. Associates | |||||||||||||
| Shanghai International Port (Group) Co., Ltd. (hereinafter referred to as "Shanghai Port Group") | Equity method | 34,171,898,201.17 | - | - | 3,700,844,097.27 | -15,345,010.77 | 269,871,649.40 | -914,383,798.30 | - | - | - | 37,212,885,138.77 | - |
| Nanshan Group | Equity method | 6,377,197,726.21 | - | - | 214,805,574.66 | 43,279,577.18 | 757,245.35 | -74,028,000.00 | - | - | -2,767,082.88 | 6,559,245,040.52 | - |
| Terminal Link SAS | Equity method | 6,395,609,168.37 | - | - | 221,059,137.39 | 110,006,179.63 | - | -381,826,231.04 | - | - | 108,192,659.85 | 6,453,040,914.20 | - |
| Liaoning Port Co., Ltd. ("Liaoning Port") （Note） | Equity method | 4,021,162,878.74 | - | - | 151,571,456.52 | 1,605,319.83 | 2,186,919.86 | -47,236,402.20 | - | - | -5,132,381.49 | 4,124,157,791.26 | 359,989,686.74 |
| Shenzhen China Merchants Qianhai Industrial Development Co., Ltd. | Equity method | 7,403,186,521.01 | - | - | 42,538,797.17 | - | - | - | - | - | - | 7,445,725,318.18 | - |
| Ningbo Zhoushan Port Company Limited ("Ningbo Zhoushan") | Equity method | 17,974,630,545.05 | - | - | 1,049,986,813.85 | 20,609,205.32 | -23,196,655.58 | -390,875,794.33 | - | - | - | 18,631,154,114.31 | - |
| Others | Equity method | 6,303,815,822.78 | 892,560,547.98 | -5,123,348.92 | 201,597,028.04 | -15,914,070.05 | -191,087.11 | -128,730,841.44 | - | - | 33,902,072.53 | 7,281,916,123.81 | 2,344,389.02 |
| Sub-total | 82,647,500,863.33 | 892,560,547.98 | -5,123,348.92 | 5,582,402,904.90 | 144,241,201.14 | 249,428,071.92 | -1,937,081,067.31 | - | - | 134,195,268.01 | 87,708,124,441.05 | 362,334,075.76 | |
| Total | 92,364,293,919.05 | 898,281,471.72 | -39,036,976.14 | 5,979,007,585.96 | -735,031,190.33 | 248,199,074.75 | -2,299,614,415.93 | - | - | 250,018,307.19 | 96,666,117,776.27 | 362,334,075.76 | |
Note: The provision for the impairment of Liaoning Port is made in previous years. No evidence of impairment was found this year, and no
impairment test was conducted.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
12. Long-term equity investments - continued
(2) Impairment testing of significant long-term equity investments
The recoverable amount is determined at the present value of expected future cash flows
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | Carrying amount | Recoverable amount | Projection period | Key parameters for projection period | Basis to determine the parameters for projection period | Key parameters for steady period | Basis to determine the key parameters for steady period |
| Terminal Link SAS(note) | 6,453,040,914.20 | 7,453,973,943.83 | 5 years | Pre-tax discount rate, 7.8%~12.2% | The discount rate is a pre-tax discount rate that reflects the specific risks of the underlying asset group or combination of asset groups | Perpetual growth rate, 1.559%~5.010% | Forward inflation rate published by BNP Paribas |
Note: The Terminal Link SAS Asset Group consists of five asset groups which are tested for impairment during the year with no impairment identified.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
13. Investments in other equity instruments
(1) Details of investments in other equity instruments
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 1/1/2023 | Changes for the year | 31/12/2023 | Dividend income recognized for the year | Accumulated gains included in other comprehensive income | Accumulated losses included in other comprehensive income | Reasons for designation as at fair value through other comprehensive income | ||||
| Addition | Reduction | Gains included in other comprehensive income for the year | Losses included in other comprehensive income for the year | Effect of changes in the scope of consolidation | |||||||
| China Ocean Shipping Agency Shenzhen Co., Ltd. | 144,301,178.28 | - | - | 3,387,985.97 | - | - | 147,689,164.25 | 20,056,500.00 | 134,179,164.25 | - | It is a non-trading equity instrument investment |
| Others | 27,644,096.74 | - | - | 33,084.28 | -215,602.37 | -17,689,094.74 | 9,772,483.91 | - | 3,873,283.91 | -3,128,300.00 | It is a non-trading equity instrument investment |
| Total | 171,945,275.02 | - | - | 3,421,070.25 | -215,602.37 | -17,689,094.74 | 157,461,648.16 | 20,056,500.00 | 138,052,448.16 | -3,128,300.00 | —— |
(2) There are no other equity instruments derecognized for the year.
| Item | Accumulated gains transferred to retained earnings due to derecognition | Accumulated losses transferred to retained earnings due to derecognition | Reason for derecognition |
| Others | - | - | Changes in the scope of consolidation |
| Total | - | - | — — |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
14. Other non-current financial assets
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 31/12/2023 | 31/12/2022 |
| Financial assets at FVTPL | 877,576,442.83 | 1,745,740,896.41 |
| Including: Investments in equity instruments | 877,576,442.83 | 1,745,740,896.41 |
| Including: Antong Holdings Co., Ltd. ("Antong Holdings") (Note) | - | 950,321,309.06 |
| Qingdao Port International Co., Ltd. | 850,222,729.23 | 767,553,775.66 |
| Others | 27,353,713.60 | 27,865,811.69 |
Note: As at 31 December 2023, the Company and Zhanjiang Zhongli Ocean Shipping Tally Co.,
Ltd., a subsidiary of the Company, together hold 6.83% equity interest in Antong Holdingsand has appointed one director to Antong Holdings. Therefore, the Company has significantinfluence over Antong Holdings and has changed its equity investment in Antong Holdingsfrom other non-current financial assets to long-term equity investments in an associate.
15. Investment properties
(1) Investment properties measured at cost
| Item | Land use rights | Buildings and structures | Total |
| I. Cost | |||
| 1. At 1 January 2023 | 128,269,825.38 | 6,177,602,852.51 | 6,305,872,677.89 |
| 2. Increase for the year | 8,388,170.37 | 13,843,232.32 | 22,231,402.69 |
| (1) Purchases | - | 1,002,852.62 | 1,002,852.62 |
| (2) Transfer from fixed assets | - | 12,840,379.70 | 12,840,379.70 |
| (3) Transfer from intangible assets | 8,388,170.37 | - | 8,388,170.37 |
| 3. Decrease for the year | - | - | - |
| 4. At 31 December 2023 | 136,657,995.75 | 6,191,446,084.83 | 6,328,104,080.58 |
| II. Accumulated depreciation and amortization | |||
| 1. At 1 January 2023 | 43,054,991.58 | 1,139,127,566.75 | 1,182,182,558.33 |
| 2. Increase for the year | 4,514,324.10 | 183,032,229.36 | 187,546,553.46 |
| (1) Provision for the year | 2,571,200.74 | 180,261,875.48 | 182,833,076.22 |
| (2) Transfer from fixed assets | - | 2,770,353.88 | 2,770,353.88 |
| (3) Transfer from intangible assets | 1,943,123.36 | - | 1,943,123.36 |
| 3. Decrease for the year | - | - | - |
| 4. At 31 December 2023 | 47,569,315.68 | 1,322,159,796.11 | 1,369,729,111.79 |
| III. Impairment provision | |||
| 1. At 1 January 2023 | - | - | - |
| 2. Increase for the year | - | - | - |
| 3. Decrease for the year | - | - | - |
| 4. At 31 December 2023 | - | - | - |
| IV. Carrying amount | |||
| 1. At 31 December 2023 | 89,088,680.07 | 4,869,286,288.72 | 4,958,374,968.79 |
| 2. At 1 January 2023 | 85,214,833.80 | 5,038,475,285.76 | 5,123,690,119.56 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
15. Investment properties - continued
(2) Investment properties without ownership certificates
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Carrying amount at 31/12/2023 | Carrying amount at 31/12/2022 | Reasons for not obtaining certificate of title | Expected time of completion |
| Buildings, structures, and land use rights | 24,363,424.74 | 24,008,665.10 | Some buildings and structures have not yet obtained certificates of land use rights | The certificate of title is underway |
16. Fixed assets
16.1 Summary of fixed assets
| Item | 31/12/2023 | 31/12/2022 |
| Fixed assets | 28,986,501,937.59 | 32,033,317,707.66 |
| Disposal of fixed assets | 36,388.76 | 8,375.84 |
| Total | 28,986,538,326.35 | 32,033,326,083.50 |
16.2 Fixed assets
(1) Details of fixed assets
| Item | Port and terminal facilities | Buildings and structures | Machinery and equipment, furniture, fixture and other equipment | Motor vehicles and cargo ships | Total |
| I. Cost | — — | — — | — — | — — | — — |
| 1. At 1 January 2023 | 33,376,255,522.14 | 2,027,195,029.06 | 17,467,174,796.88 | 2,314,581,094.83 | 55,185,206,442.91 |
| 2. Increase for the year | 355,653,533.35 | 5,819,641.52 | 946,224,073.20 | 15,977,020.14 | 1,323,674,268.21 |
| (1) Purchase | 37,782,655.58 | 31,964.06 | 322,325,677.27 | 13,660,825.82 | 373,801,122.73 |
| (2) Transfer from development expenditure | 6,341,635.07 | - | 8,723,850.63 | - | 15,065,485.70 |
| (3) Transfer from construction in progress | 311,529,242.70 | 1,453,075.86 | 344,378,153.65 | 2,316,194.32 | 659,676,666.53 |
| (4) Transfer from right-of-use assets | - | - | 270,796,391.65 | - | 270,796,391.65 |
| (5) Transfer from other accounts | - | 4,334,601.60 | - | - | 4,334,601.60 |
| 3. Decrease for the year | 2,763,230,873.66 | 261,672,874.02 | 1,842,920,457.17 | 60,681,086.42 | 4,928,505,291.27 |
| (1) Disposal or retirement | 42,219,921.65 | 16,064,482.96 | 139,255,106.92 | 52,104,672.51 | 249,644,184.04 |
| (2) Transfer to investment properties | - | 12,840,379.70 | - | - | 12,840,379.70 |
| (3) Effect of changes in the scope of consolidation | 2,720,840,274.13 | 232,768,011.36 | 1,701,179,778.57 | 8,576,413.91 | 4,663,364,477.97 |
| (4) Transfer to right-of-use assets | 170,677.88 | - | 2,485,571.68 | - | 2,656,249.56 |
| 4. Adjustments to the amount carried forward | -1,058,728.12 | - | 184,445.13 | 83,718.00 | -790,564.99 |
| 5. Reclassification | -57,793,950.52 | 51,434,642.27 | 6,359,308.25 | - | - |
| 6. Effect of translation of financial statements denominated in foreign currencies | 227,485,569.31 | 2,918,280.50 | 164,288,140.60 | 13,423,975.49 | 408,115,965.90 |
| 7. At 31 December 2023 | 31,137,311,072.50 | 1,825,694,719.33 | 16,741,310,306.89 | 2,283,384,722.04 | 51,987,700,820.76 |
| II. Accumulated depreciation | — — | — — | — — | — — | — — |
| 1. At 1 January 2023 | 10,720,998,321.19 | 635,722,974.00 | 10,636,302,077.50 | 1,095,290,493.80 | 23,088,313,866.49 |
| 2. Increase for the year | 963,017,607.23 | 78,532,518.38 | 930,468,443.58 | 108,868,177.01 | 2,080,886,746.20 |
| (1) Provision | 963,017,607.23 | 74,197,916.78 | 837,465,030.34 | 108,868,177.01 | 1,983,548,731.36 |
| (2) Transfer from right-of-use assets | - | - | 93,003,413.24 | - | 93,003,413.24 |
| (3) Transfer from other accounts | - | 4,334,601.60 | - | - | 4,334,601.60 |
| 3. Decrease for the year | 1,131,042,660.07 | 90,575,216.73 | 1,243,641,341.44 | 55,932,196.77 | 2,521,191,415.01 |
| (1) Disposal or retirement | 31,267,071.50 | 14,971,013.85 | 121,150,414.20 | 49,154,025.33 | 216,542,524.88 |
| (2) Transfer to investment properties | - | 2,770,353.88 | - | - | 2,770,353.88 |
| (3) Effect of changes in the scope of consolidation | 1,099,775,588.57 | 72,833,849.00 | 1,122,490,927.24 | 6,778,171.44 | 2,301,878,536.25 |
| 4. Reclassification | -1,509,396.69 | 625,422.16 | 883,974.53 | - | - |
| 5. Effect of translation of financial statements denominated in foreign currencies | 46,017,171.79 | 713,896.63 | 88,553,012.49 | 4,401,121.50 | 139,685,202.41 |
| 6. At 31 December 2023 | 10,597,481,043.45 | 625,019,594.44 | 10,412,566,166.66 | 1,152,627,595.54 | 22,787,694,400.09 |
| III. Impairment provision | — — | — — | — — | — — | — — |
| 1. At 1 January 2023 | 57,546,986.63 | 5,985,164.85 | 42,717.28 | - | 63,574,868.76 |
| 2. Increase for the year | 138,917,159.59 | 3,429,362.62 | 7,577,097.23 | - | 149,923,619.44 |
| 3. Disposal or retirement for the year | - | - | - | - | - |
| 4. Effect of translation of financial statements denominated in foreign currencies | - | - | 5,994.88 | - | 5,994.88 |
| 5. At 31 December 2023 | 196,464,146.22 | 9,414,527.47 | 7,625,809.39 | - | 213,504,483.08 |
| IV. Carrying amount | — — | — — | — — | — — | — — |
| 1. At 31 December 2023 | 20,343,365,882.83 | 1,191,260,597.42 | 6,321,118,330.84 | 1,130,757,126.50 | 28,986,501,937.59 |
| 2. At 1 January 2023 | 22,597,710,214.32 | 1,385,486,890.21 | 6,830,830,002.10 | 1,219,290,601.03 | 32,033,317,707.66 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
16. Fixed assets - continued
16.2 Fixed assets - continued
(2) The Group has no fixed assets that are temporarily idle as at 31 December 2023.
(3) Fixed assets leased out under operating leases
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Carrying amount at 31/12/2023 | Carrying amount at 31/12/2022 |
| Buildings and structures | 190,979,949.85 | 196,480,507.61 |
| Port and terminal facilities | 35,709,105.32 | 33,260,157.31 |
| Machinery and equipment, furniture, fixture and other equipment | 5,012,091.76 | 7,920,761.45 |
| Total | 231,701,146.93 | 237,661,426.37 |
(4) Fixed assets without ownership certificates
| Item | Carrying amount at 31/12/2023 | Carrying amount at 31/12/2022 | Remark |
| Buildings, structures, port and terminal facilities | 1,539,024,375.12 | 1,786,308,720.95 | This is mainly due to the fact that certain buildings and structures have not yet obtained the land use rights of the corresponding land and the approval procedures have not yet been completed. |
(5) Details of fixed assets depreciated but still in use and temporarily idle at the end of the year,
and fixed assets disposed and retired in the year:
| Item | Amount | Remark |
| Cost of fixed assets fully depreciated but still in use at the end of the year | 4,947,824,713.22 | |
| Cost of fixed assets temporarily idle at the end of the year | - | |
| Fixed assets disposed and retired in the year: | — — | — — |
| Including: Cost of fixed assets disposed and retired in the year | 249,644,184.04 | |
| Net book value of fixed assets disposed and retired in the year | 33,101,659.16 | |
| Loss on disposal or retirement of fixed assets in the year | 18,876,795.60 |
(6) The details of the Group's fixed assets with restricted ownership as at 31 December 2023
are set out in Note (VIII) 64.
(7) Impairment testing of fixed assets
The recoverable amount is determined at the present value of expected future cash flows
| Item | Carrying amount | Recoverable amount | Amount of impairment | Projection period | Key parameters for projection period | Key parameters for steady period | Basis to determine the key parameters for steady period |
| Zhoushan RoRo Asset Group (Note) | 397,078,829.12 | 208,048,600.00 | 189,030,229.12 | 10 years | Pre-tax discount rate, 12.01% | Perpetual growth rate, 2.20% | China's forward inflation rate published by the World Bank |
| Total | 397,078,829.12 | 208,048,600.00 | 189,030,229.12 | — — | — — | — — | — — |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
16. Fixed assets - continued
16.2 Fixed assets - continued
(7) Impairment testing of fixed assets - continued
Note: Zhoushan RoRo Asset Group include fixed assets and intangible assets, of which fixed
assets are impaired at the amount of RMB 147,557,081.15 and intangible assets areimpaired at the amount of RMB 41,473,147.97.
16.3 Disposal of fixed assets
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 31/12/2023 | 31/12/2022 |
| Machinery and equipment, furniture, fixture and other equipment | 36,388.76 | 8,375.84 |
| Total | 36,388.76 | 8,375.84 |
17. Construction in progress
(1) Presentation of construction in progress
| Item | 31/12/2023 | 31/12/2022 |
| Construction in progress | 2,907,014,186.24 | 2,405,872,478.61 |
| Materials for construction of fixed assets | 2,803,095.22 | 7,971,929.03 |
| Total | 2,909,817,281.46 | 2,413,844,407.64 |
(2) Details of construction in progress
| Item | 31/12/2023 | 31/12/2022 | ||||
| Gross carrying amount | Provision for impairment | Carrying amount | Gross carrying amount | Provision for impairment | Carrying amount | |
| Port and terminal facilities | 2,380,800,758.33 | - | 2,380,800,758.33 | 1,991,321,268.14 | - | 1,991,321,268.14 |
| Infrastructure | 252,638,193.22 | - | 252,638,193.22 | 201,444,537.67 | - | 201,444,537.67 |
| Berths and yards | 178,174,354.90 | - | 178,174,354.90 | 18,728,577.14 | - | 18,728,577.14 |
| Cargo ships under construction | 1,726,548.68 | - | 1,726,548.68 | - | - | - |
| Others | 93,674,331.11 | - | 93,674,331.11 | 194,378,095.66 | - | 194,378,095.66 |
| Total | 2,907,014,186.24 | - | 2,907,014,186.24 | 2,405,872,478.61 | - | 2,405,872,478.61 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
17. Construction in progress - continued
(3) The top ten balances of construction in progress
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Budget amount | 31/12/2022 | Increase for the year | Transfer to fixed assets | Other decreases for the year | Effect of translation of financial statements denominated in foreign currencies | 31/12/2023 | Proportion of accumulated construction investment in budget (%) | Construction progress (%) | Amount of accumulated capitalized interest | Including: Capitalized interest for the year | Interest capitalization rate for the current year (%) | Capital source |
| Reconstruction project of HIPG container, oil terminal and tank area | 2,817,485,265.02 | 817,365,084.37 | - | - | - | 13,860,209.69 | 831,225,294.06 | 57.68 | 57.68 | 942,888.05 | - | - | Own funds and loans |
| Phase I project for the stuffing and destuffing service area of Baoman Port Area, Zhanjiang Port | 683,007,100.00 | 269,045,354.01 | 227,860,991.66 | - | - | - | 496,906,345.67 | 72.75 | 72.75 | 29,908,415.82 | 10,355,373.62 | 3.50 | Own funds and loans |
| General cargo terminal project at Donghai Island Port Area of Zhanjiang Port | 905,348,400.00 | 448,877,835.04 | 67,384.80 | - | - | - | 448,945,219.84 | 49.59 | 49.59 | 44,364,372.49 | - | - | Own funds and loans |
| Phase I expansion project for the container terminal at Baoman Port Area, Zhanjiang Port | 2,342,775,800.00 | 191,463,684.57 | 37,101,454.78 | - | - | - | 228,565,139.35 | 9.76 | 9.76 | 1,011,370.60 | 57,750.00 | 3.30 | Own funds and loans |
| TCP tire-type container crane project | 211,491,137.08 | 16,222,603.92 | 138,123,291.50 | 6,430,507.98 | - | 6,438,252.61 | 154,353,640.05 | 76.02 | 76.02 | - | - | - | Own funds |
| Subsequent construction work in progress at HIPG terminal | 84,992,400.00 | 28,006,814.86 | 56,051,165.83 | 16,985,386.70 | 3,212,066.78 | 657,829.52 | 64,518,356.73 | 99.67 | 99.67 | - | - | - | Own funds |
| Back land reclamation project on Haidagan Bulk Yard and Supporting Facilities and Liquid Bulk Berth | 82,400,000.00 | 60,576,339.80 | 1,674,220.80 | - | - | - | 62,250,560.60 | 75.55 | 75.55 | - | - | - | Own funds |
| Installation project of bucket-wheel stacker reclaimer, Zhanjiang Port | 74,800,000.00 | 51,551,526.93 | 837,359.25 | - | - | - | 52,388,886.18 | 70.04 | 70.04 | 2,671,994.44 | 837,359.25 | 3.50 | Own funds and loans |
| AMPLIACAO PLATAFORMAS REEFER | 71,524,388.49 | - | 53,555,672.30 | 6,045,103.81 | - | 1,479,878.70 | 48,990,447.19 | 76.95 | 76.95 | - | - | - | Own funds |
| Dachanwan phase II project | 918,521,317.23 | 24,872,917.72 | 21,319,643.76 | - | - | - | 46,192,561.48 | 5.03 | 5.03 | - | - | - | Own funds |
| Total | 8,192,345,807.82 | 1,907,982,161.22 | 536,591,184.68 | 29,460,998.49 | 3,212,066.78 | 22,436,170.52 | 2,434,336,451.15 | — — | — — | 78,899,041.40 | 11,250,482.87 | — — |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
17. Construction in progress - continued
(4) Materials for construction of fixed assets
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 31/12/2023 | 31/12/2022 | ||||
| Gross carrying amount | Provision for impairment | Carrying amount | Gross carrying amount | Provision for impairment | Carrying amount | |
| Materials for construction of fixed assets | 2,803,095.22 | - | 2,803,095.22 | 7,971,929.03 | - | 7,971,929.03 |
(5) Impairment testing of construction in progress
The recoverable amount is determined at the present value of expected future cash flows
| Item | Carrying amount | Recoverable amount | Amount of impairment | Projection period | Key parameters for projection period | Key parameters for steady period | Basis to determine the key parameters for steady period |
| HIPG Asset Group | 9,116,161,496.49 | 51,365,680,683.52 | - | 5 years | Pre-tax discount rate, 7.55% | Perpetual growth rate, 7% | Consult the expected growth rate of the industry |
| Total | 9,116,161,496.49 | 51,365,680,683.52 | - |
18. Right-of-use assets
（1） Details of right-of-use assets
| Item | Port and terminal facilities | Buildings and structures | Machinery and equipment, furniture, fixture and other equipment | Land use rights | Motor vehicles, cargo ships and others | Total |
| I. Cost | —— | —— | —— | —— | —— | —— |
| 1. At 1 January 2023 | 7,414,725,804.49 | 174,746,285.16 | 361,404,132.03 | 2,833,468,093.15 | 15,456,422.12 | 10,799,800,736.95 |
| 2. Increase for the year | 126,996,462.16 | 47,184,328.34 | 5,908,348.40 | 314,033,487.98 | 5,119,357.99 | 499,241,984.87 |
| (1) Purchase | 126,825,784.28 | 47,184,328.34 | 3,422,776.72 | 314,033,487.98 | 5,119,357.99 | 496,585,735.31 |
| (2) Others | 170,677.88 | - | 2,485,571.68 | - | - | 2,656,249.56 |
| 3. Decrease for the year | 83,575,652.80 | 14,851,420.78 | 277,492,044.42 | - | 8,251,408.84 | 384,170,526.84 |
| (1) Termination of lease | 83,575,652.80 | 13,723,966.87 | 6,695,652.77 | - | 8,251,408.84 | 112,246,681.28 |
| (2) Decrease due to change in the scope of consolidation | - | 1,127,453.91 | - | - | - | 1,127,453.91 |
| (3) Transfer to fixed assets | - | - | 270,796,391.65 | - | - | 270,796,391.65 |
| 4. Effect of translation of financial statements denominated in foreign currencies | 104,207,338.95 | 2,294,309.58 | 594,918.95 | 49,298,269.33 | - | 156,394,836.81 |
| 5. At 31 December 2023 | 7,562,353,952.80 | 209,373,502.30 | 90,415,354.96 | 3,196,799,850.46 | 12,324,371.27 | 11,071,267,031.79 |
| II. Accumulated depreciation | — — | — — | — — | — — | — — | — — |
| 1. At 1 January 2023 | 940,705,350.30 | 59,749,857.79 | 119,454,049.67 | 326,945,093.98 | 10,304,162.88 | 1,457,158,514.62 |
| 2. Increase for the year | 262,536,189.49 | 24,038,515.68 | 20,649,140.40 | 46,180,031.37 | 4,099,083.51 | 357,502,960.45 |
| (1) Provision | 262,536,189.49 | 24,038,515.68 | 20,649,140.40 | 46,180,031.37 | 4,099,083.51 | 357,502,960.45 |
| 3. Decrease for the year | 80,201,819.61 | 14,365,794.00 | 99,372,627.07 | - | 8,251,408.84 | 202,191,649.52 |
| (1) Termination of lease | 80,201,819.61 | 13,538,700.80 | 6,369,213.83 | - | 8,251,408.84 | 108,361,143.08 |
| (2) Transfer to fixed assets | - | - | 93,003,413.24 | - | - | 93,003,413.24 |
| (3) Decrease due to change in the scope of consolidation | - | 827,093.20 | - | - | - | 827,093.20 |
| 4. Effect of translation of financial statements denominated in foreign currencies | 10,472,990.85 | 495,286.98 | 558,342.85 | 5,602,274.34 | - | 17,128,895.02 |
| 5. At 31 December 2023 | 1,133,512,711.03 | 69,917,866.45 | 41,288,905.85 | 378,727,399.69 | 6,151,837.55 | 1,629,598,720.57 |
| III. Impairment provision | — — | — — | — — | — — | — — | — — |
| 1. At 1 January 2023 | - | - | - | - | - | - |
| 2. Increase for the year | - | - | - | - | - | - |
| 3. Decrease for the year | - | - | - | - | - | - |
| 4. At 31 December 2023 | - | - | - | - | - | - |
| IV. Carrying amount | — — | — — | — — | — — | — — | — — |
| 1. At 31 December 2023 | 6,428,841,241.77 | 139,455,635.85 | 49,126,449.11 | 2,818,072,450.77 | 6,172,533.72 | 9,441,668,311.22 |
| 2. At 1 January 2023 | 6,474,020,454.19 | 114,996,427.37 | 241,950,082.36 | 2,506,522,999.17 | 5,152,259.24 | 9,342,642,222.33 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
19. Intangible assets
(1) Details of intangible assets
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Land use rights | Terminal management rights | Others | Total |
| I. Cost | — — | — — | — — | — — |
| 1. At 1 January 2023 | 15,314,517,408.67 | 9,033,916,504.04 | 1,500,585,297.68 | 25,849,019,210.39 |
| 2. Increase for the year | 4,829,976.87 | 70,899,565.34 | 210,116,533.73 | 285,846,075.94 |
| (1) Purchase | 4,707,118.86 | 70,899,565.34 | 204,248,227.46 | 279,854,911.66 |
| (2) Transfer from R&D expenditure | - | - | 279,255.32 | 279,255.32 |
| (3) Other increase | 122,858.01 | - | 5,589,050.95 | 5,711,908.96 |
| 3. Decrease for the year | 1,391,040,555.28 | - | 97,786,230.03 | 1,488,826,785.31 |
| (1) Disposal | 117,561,406.55 | - | 12,263,934.48 | 129,825,341.03 |
| (2) Effect of changes in the scope of consolidation | 1,242,052,238.36 | - | 85,144,042.52 | 1,327,196,280.88 |
| (3) Transfer to investment properties | 8,388,170.37 | - | - | 8,388,170.37 |
| (4) Other decrease | 23,038,740.00 | - | 378,253.03 | 23,416,993.03 |
| 4. Effect of translation of financial statements denominated in foreign currencies | 3,238,376.56 | 614,328,132.15 | 55,732,509.00 | 673,299,017.71 |
| 5. At 31 December 2023 | 13,931,545,206.82 | 9,719,144,201.53 | 1,668,648,110.38 | 25,319,337,518.73 |
| II. Accumulated amortization | — — | — — | — — | — — |
| 1. At 1 January 2023 | 4,096,452,545.66 | 1,897,700,710.79 | 562,263,716.23 | 6,556,416,972.68 |
| 2. Increase for the year | 337,512,145.19 | 265,684,203.80 | 83,683,325.73 | 686,879,674.72 |
| (1) Provision | 337,512,145.19 | 265,684,203.80 | 83,683,325.73 | 686,879,674.72 |
| (2) Other increase | - | - | - | - |
| 3. Decrease for the year | 136,784,782.90 | - | 70,286,984.40 | 207,071,767.30 |
| (1) Disposal | 24,240,728.18 | - | 12,642,187.51 | 36,882,915.69 |
| (2) Transfer to investment properties | 1,943,123.36 | - | - | 1,943,123.36 |
| (3) Effect of changes in the scope of consolidation | 110,600,931.36 | - | 57,644,796.89 | 168,245,728.25 |
| (4) Other decrease | - | - | - | - |
| 4. Effect of translation of financial statements denominated in foreign currencies | 1,454,778.05 | 131,353,162.92 | 20,232,242.87 | 153,040,183.84 |
| 5. At 31 December 2023 | 4,298,634,686.00 | 2,294,738,077.51 | 595,892,300.43 | 7,189,265,063.94 |
| III. Impairment provision | — — | — — | — — | — — |
| 1. At 1 January 2023 | 15,537,122.10 | - | - | 15,537,122.10 |
| 2. Increase for the year | 28,662,259.14 | - | 12,810,888.83 | 41,473,147.97 |
| 3. Decrease for the year | - | - | - | - |
| 4. At 31 December 2023 | 44,199,381.24 | - | 12,810,888.83 | 57,010,270.07 |
| IV. Carrying amount | — — | — — | — — | — — |
| 1. At 31 December 2023 | 9,588,711,139.58 | 7,424,406,124.02 | 1,059,944,921.12 | 18,073,062,184.72 |
| 2. At 1 January 2023 | 11,202,527,740.91 | 7,136,215,793.25 | 938,321,581.45 | 19,277,065,115.61 |
(2) Land use rights without ownership certificates as at 31 December 2023:
| Item | Carrying amount at 31/12/2023 | Carrying amount at 31/12/2022 |
| Land use rights (Note) | 2,374,139,495.63 | 2,511,195,386.58 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
19. Intangible assets - continued
(2) Land use rights without ownership certificates as at 31 December 2023: - continued
Note: At 31 December 2023, the land use rights without ownership certificates mainly represent
the land use rights for berth and storage yard within Chiwan Port area obtained by the Groupfrom Nanshan Group, with an area of 691,828.56 m
, and Dachanwan Port area Phase IIland use rights obtained by ASJ, the costs of which are RMB 1,179,949,191.44 and RMB918,521,317.23 respectively.
The land use rights for berth and storage yard within Chiwan Port area obtained by theGroup from Nanshan Group represent the capital contribution from Nanshan Group to theCompany upon restructuring of the Company, while the remaining land use rights areobtained from Nanshan Group by way of long-term lease. Up to date, Nanshan Group hasnot yet obtained the land use rights in respect of the lands within Chiwan watershed,including aforementioned capital contribution and land lease to the Group, therefore, theGroup cannot obtain the ownership certificate for relevant land and buildings on such land.The Company's management understood that Nanshan Group is negotiating with relevantgovernment departments regarding the historical issues, and the date when the Group canobtain the ownership certificate of relevant land and buildings on such land cannot beestimated reliably.
ASJ is negotiating with relevant government departments for handling the ownershipcertificates of Dachanwan Port area Phase II land use rights obtained by it.
(3) Impairment testing of intangible assets
Refer to Note (VIII), 16.2 (7) for details.
20. Goodwill
(1) Details of goodwill
CHINA MERCHANTS PORT GROUP CO., LTD.
Investee
| Investee | Sources | 31/12/2022 | Increase | Decrease | Effect of translation of financial statements denominated in foreign currencies | 31/12/2023 |
| TCP | Acquisition of equity | 2,716,399,522.38 | - | - | 270,072,549.76 | 2,986,472,072.14 |
| Mega Shekou Container Terminals Limited ("Mega SCT") | Acquisition of equity | 1,815,509,322.42 | - | - | - | 1,815,509,322.42 |
| CM Port | Acquisition of equity | 993,992,000.00 | - | - | - | 993,992,000.00 |
| Shantou Port | Acquisition of equity | 552,317,736.65 | - | - | - | 552,317,736.65 |
| Zhanjiang Port | Acquisition of equity | 418,345,307.68 | - | - | - | 418,345,307.68 |
| Shenzhen Mawan Project | Acquisition of equity | 408,773,001.00 | - | - | - | 408,773,001.00 |
| Ningbo Daxie Container Terminal Co., Ltd. (formerly known as Ningbo Daxie China Merchants International Terminals Co. Ltd.) ("Ningbo Daxie") | Consolidation of associate into subsidiary | 188,497,194.41 | - | 188,497,194.41 | - | - |
| Others | Acquisition of equity | 288,255,850.88 | - | - | - | 288,255,850.88 |
| Sub-total | — — | 7,382,089,935.42 | - | 188,497,194.41 | 270,072,549.76 | 7,463,665,290.77 |
| Provision for impairment of goodwill | — — | 970,663,044.33 | - | - | - | 970,663,044.33 |
| Total | — — | 6,411,426,891.09 | - | 188,497,194.41 | 270,072,549.76 | 6,493,002,246.44 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
20. Goodwill - continued
(2) Provision for impairment of goodwill
CHINA MERCHANTS PORT GROUP CO., LTD.
Investee
| Investee | 31/12/2022 | Provision | Decrease | Effect of translation of financial statements denominated in foreign currencies | 31/12/2023 |
| Zhanjiang Port | 418,345,307.68 | - | - | - | 418,345,307.68 |
| Shantou Port | 552,317,736.65 | - | - | - | 552,317,736.65 |
| Total | 970,663,044.33 | - | - | - | 970,663,044.33 |
(3) Information of asset groups or portfolio of asset groups to which the goodwill belongs
| Name | Composition of asset groups or portfolio of asset groups to which it is allocated and its basis | Is it consistent with that of the prior year? |
| TCP | The Group identifies asset groups or portfolio of asset groups based on their ability to generate cash inflows independently, the manner in which they manage their production and operating activities (primarily by geographic region), and the unified decision-making on use or disposal of assets. | Yes |
| Mega SCT | Yes | |
| CM Port | Yes | |
| Shantou Port | Yes | |
| Zhanjiang Port | Yes | |
| Shenzhen Mawan Project | Yes | |
| Others | Yes |
When testing the goodwill for impairment, the Group compares the carrying amount of related assetgroups and portfolio of asset groups (including goodwill) with the recoverable amount. If therecoverable amount is less than the carrying amount, the difference is included in profit or loss forthe period. The Group determines the recoverable amount of the asset groups and portfolio of assetgroups that generate goodwill at fair value less cost of disposal or at present value of expected futurecash flows. The fair value is determined using market approach. The present value of cash flows isestimated based on the forecast of cash flows for 5 years to 25 years detailed forecast period andsubsequent forecast period. The estimated future cash flows for the detailed forecast period arebased on the business plan established by the management; the expected future cash flows for thesubsequent forecast period are determined in conjunction with the level of the final year of thedetailed forecast period, combined with the Group's business plans, industry trends and inflationrates. The growth rate adopted will not exceed the long-term average growth rate of the countrywhere the asset groups and portfolio of asset groups are located. The key assumptions used by theGroup in estimating the present value of future cash flows include growth rate and discount rate etc.The pre-tax discount rate and the growth rate for subsequent forecast period adopted in 2023 are
10.97%-21.99% and 2.20%-3.02% respectively. The parameters of key assumptions determined bythe Group's management are in line with the Group's historical experience or external source ofinformation.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
20. Goodwill - continued
(4) Specific method for determination of recoverable amount
The recoverable amount is determined at the present value of expected future cash flows
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | Projection period | Key parameters for projection period | Basis to determine the key parameters for projection period | Key parameters for steady period | Basis to determine the key parameters for steady period |
| Mega SCT | 5 years | 1. Pre-tax discount rate: 12.23% 2. Average revenue growth rate for projection period: 3.35% 3. Average profit margin for projection period: 37.58% | 1. The discount rate is a pre-tax discount rate that reflects the specific risks of the underlying asset group or combination of asset groups. 2. Average revenue growth rate for projection period and average profit margin for projection period: Taking into account comprehensive factors such as each company's business operations, performance, key financial indicators and market environment | 1. Pre-tax discount rate: 12.23% 2. Average revenue growth rate for steady period: 2.20% 3. Average profit margin for steady period: 42.89% | 1. The discount rate is a pre-tax discount rate that reflects the specific risks of the underlying asset group or combination of asset groups. 2. Average revenue growth rate for steady period: China's forward inflation rate published by the World Bank (TCP refers to Brazil's forward inflation rate published by the World Bank) 3. Average profit margin for steady period: Taking into account comprehensive factors such as each company's business operations, performance, key financial indicators and market environment |
| TCP | 25 years | 1. Pre-tax discount rate: 21.99% 2. Average revenue growth rate for projection period: 5.36% 3. Average profit margin for projection period: 53.33% | 1. Pre-tax discount rate: 21.99% 2. Average revenue growth rate for steady period: 3.02% 3. Average profit margin for steady period: 54.81% |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
21. Long-term prepaid expenses
Presentation of long-term prepaid expenses:
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 31/12/2022 | Effect of changes in the scope of consolidation | Increase for the year | Amortization in the year | Other decreases | 31/12/2023 | Reason for other decreases |
| Tonggu channel widening project (Note 1) | 455,446,696.75 | - | - | 14,449,031.76 | - | 440,997,664.99 | — — |
| West public channel widening project at West port area (Note 2) | 249,437,402.87 | - | - | 9,919,028.64 | 1,538,430.04 | 237,979,944.19 | Reclassify to dredging project |
| Dredging project | 69,760,419.37 | - | 26,871,419.28 | 17,342,403.61 | - | 79,289,435.04 | — — |
| Relocation project of Nanhai Rescue Bureau | 37,554,111.50 | - | - | 1,107,368.40 | - | 36,446,743.10 | — — |
| Expenditures for the improvement of leased fixed assets | 20,631,173.37 | - | 3,920,837.53 | 2,374,618.58 | 82,477.87 | 22,094,914.45 | Transfer to inventory account |
| Others | 153,527,101.04 | -8,905,237.72 | 80,141,950.88 | 47,779,010.68 | - | 176,984,803.52 | — — |
| Total | 986,356,904.90 | -8,905,237.72 | 110,934,207.69 | 92,971,461.67 | 1,620,907.91 | 993,793,505.29 | — — |
Note 1: This represents the Group's actual expenses on Shenzhen Western Port Area Tonggu
Channel 210-270M Widening Project. According to relevant resolutions of ShenzhenMunicipal Government, the enterprise and government shall bear 60% and 40% of theexpenses incurred for the 210-240M widening project, and 50% and 50% of the expensesincurred for the 240-270M widening project respectively. The Company's subsidiary hasincluded the expenses on deepening the channel in the item of "long-term prepaidexpenses", and amortized such expenses over the expected useful lives of the twowidening projects of 35 and 40 years using straight-line method since the completion ofeach project in 2008 and 2019, respectively.
Note 2: This represents the Group's actual expenses on Shenzhen West Port Area Public Channel
Widening Project, of which the widening of 240-270M in the first section was completedon 1 June 2019 and the widening of 240-270M in the second and third sections wascompleted on 5 November 2020. According to relevant resolutions of Shenzhen MunicipalGovernment, the enterprise and government shall bear 50% and 50% of the expensesincurred for the project respectively. The Company's subsidiary has included the expenseson deepening the channel in the item of "long-term prepaid expenses", and amortized suchexpenses over the expected useful life of 40 years using straight-line method since thecompletion of each section of the channel widening project.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
22. Deferred income tax
(1) Deferred tax assets before offsetting
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 31/12/2023 | 31/12/2022 (Restated) | ||
| Deductible temporary differences | Deferred tax assets | Deductible temporary differences | Deferred tax assets | |
| Lease liabilities | 812,240,581.51 | 218,145,932.73 | 582,736,512.28 | 164,262,934.19 |
| Unrealized profit | 749,254,178.80 | 183,009,204.87 | 756,772,558.79 | 184,729,651.97 |
| Terminal operating right | 714,547,999.18 | 214,364,399.78 | 702,633,317.13 | 210,789,995.14 |
| Depreciation of fixed assets | 162,352,087.79 | 40,588,021.95 | 154,724,225.49 | 35,753,675.92 |
| Provision for credit loss | 151,277,238.51 | 32,071,347.97 | 190,727,520.03 | 35,544,695.31 |
| Accrued and unpaid wages | 126,623,677.19 | 27,883,418.55 | 161,026,788.29 | 35,802,355.38 |
| Provisions | 85,590,059.41 | 29,100,620.20 | 35,365,156.43 | 12,024,153.19 |
| Deductible losses | 43,785,085.09 | 10,946,271.43 | 182,211,924.34 | 40,193,891.36 |
| Deferred income | 39,203,663.56 | 9,101,072.49 | 36,723,054.56 | 8,709,144.22 |
| Amortization of computer software | 7,345,031.20 | 1,836,257.80 | 9,291,532.77 | 2,322,883.19 |
| Provision for impairment of assets | 6,698,523.93 | 1,555,485.91 | 5,507,073.16 | 1,376,768.29 |
| Organization costs | 1,028,867.64 | 257,216.91 | 3,498,150.00 | 874,537.50 |
| Others | 70,987,022.41 | 18,570,226.51 | 57,124,137.75 | 15,595,505.07 |
| Total | 2,970,934,016.22 | 787,429,477.10 | 2,878,341,951.02 | 747,980,190.73 |
(2) Deferred tax liabilities before offsetting
| Item | 31/12/2023 | 31/12/2022 (Restated) | ||
| Taxable temporary differences | Deferred tax liabilities | Taxable temporary differences | Deferred tax liabilities | |
| Withholding dividend income tax | 41,551,214,196.81 | 2,840,377,397.22 | 37,565,601,815.13 | 2,568,624,605.88 |
| Lease business | 1,017,854,192.39 | 282,003,933.26 | 783,000,219.10 | 224,483,346.07 |
| Terminal operating right | 307,617,857.01 | 92,285,357.10 | 302,488,503.92 | 90,746,551.18 |
| Fair value adjustment of assets acquired from business combination | 4,880,293,882.18 | 1,292,552,086.64 | 7,755,954,464.86 | 1,762,190,010.27 |
| Depreciation of fixed assets | 975,166,842.96 | 272,103,476.86 | 1,119,997,714.31 | 280,579,814.18 |
| Changes in fair value of other non-current financial assets | 408,104,042.76 | 99,604,068.18 | 330,012,225.76 | 82,503,056.44 |
| Changes in fair value of investments in other equity instruments | 134,179,164.24 | 33,544,791.03 | 130,791,178.28 | 32,697,794.57 |
| Valuation of held-for-trading financial assets and liabilities | 2,161,643.84 | 540,410.96 | - | - |
| Others | 1,045,132,765.59 | 118,992,583.19 | 1,169,095,183.52 | 126,676,026.52 |
| Total | 50,321,724,587.78 | 5,032,004,104.44 | 49,156,941,304.88 | 5,168,501,205.11 |
(3) Deferred tax assets or liabilities that are presented at the net amount after offsetting
| Item | Offset amount of deferred tax assets and liabilities at the end of the current year | Balance of deferred tax assets or liabilities after offsetting at the end of the current year | Offset amount of deferred tax assets and liabilities at the end of the prior year (Restated) | Balance of deferred tax assets or liabilities after offsetting at the end of the prior year (Restated) |
| Deferred tax assets | -372,366,000.07 | 415,063,477.03 | -313,481,369.78 | 434,498,820.95 |
| Deferred tax liabilities | -372,366,000.07 | 4,659,638,104.37 | -313,481,369.78 | 4,855,019,835.33 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
22. Deferred income tax - continued
(4) Deductible temporary differences and deductible losses for which deferred tax assets are
not recognized
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 31/12/2023 | 31/12/2022 |
| Deductible temporary differences | 966,126,806.19 | 930,204,772.41 |
| Deductible losses | 2,334,799,700.50 | 2,112,659,943.00 |
| Total | 3,300,926,506.69 | 3,042,864,715.41 |
The Group recognizes deferred income tax assets to the extent of future taxable income that is likelyto be obtained to offset the deductible temporary differences and deductible losses. For the excessof deductible temporary differences and deductible losses over future taxable income, no deferredtax assets are recognized.
(5) Deductible losses for which deferred tax assets are not recognized will be expired in the
following years:
| Year | 31/12/2023 | 31/12/2022 |
| 2023 | - | 515,101,493.80 |
| 2024 | 483,200,212.68 | 488,358,232.03 |
| 2025 | 375,189,307.19 | 375,208,491.05 |
| 2026 | 110,765,532.94 | 112,756,494.15 |
| 2027 | 612,819,518.30 | 600,178,442.73 |
| 2028 | 752,825,129.39 | - |
| Deductible losses due after 2029 | - | 21,056,789.24 |
| Total | 2,334,799,700.50 | 2,112,659,943.00 |
23. Other non-current assets
| Item | 31/12/2023 | 31/12/2022 |
| Advances for the channel project (Note) | 1,013,508,448.79 | 989,752,762.75 |
| Prepayments for fixed assets | 144,896,516.09 | 117,094,834.14 |
| Prepayments for terminal franchise | 29,807,737.16 | 27,493,116.21 |
| Others | 5,943,287.58 | 52,448,665.69 |
| total | 1,194,155,989.62 | 1,186,789,378.79 |
Note: This represents that the Company's subsidiary Zhanjiang Port, upon its reorganization into
a joint stock company in 2007, signed the Channel Arrangement Agreement with State-owned Assets Supervision and Administration Commission of Zhanjiang ("ZhanjiangSASAC") and China Merchants International Terminal (Zhanjiang) Co., Ltd. According tothe agreement, the channel belongs to Zhanjiang SASAC, therefore, the Group presentedthe advances of channel project that should be repaid by Zhanjiang SASAC as other non-current assets.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
24. Short-term borrowings
(1) Classification of short-term borrowings
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 31/12/2023 | 31/12/2022 |
| Credit borrowings | 15,593,937,427.86 | 7,149,322,782.85 |
| Guaranteed borrowings (Note 1) | 110,096,708.33 | - |
| Mortgage borrowings (Note 2) | 10,011,152.78 | 15,015,583.33 |
| Total | 15,714,045,288.97 | 7,164,338,366.18 |
Note 1: The borrowings are guaranteed by Guangdong Zhanjiang Port Logistics Co., Ltd. ("Zhanjiang
Port Logistics"), a subsidiary of the Company.
Note 2: It represents the short-term borrowings obtained by Zhoushan RoRo, a subsidiary of the
Company, with the land use rights and buildings on the land held by it as the collateral.
(2) As at 31 December 2023, the Group has no short-term borrowings that are overdue.
25. Notes payable
| Category | 31/12/2023 | 31/12/2022 |
| Bank acceptance | 64,280,925.21 | - |
| Commercial acceptance | 9,180,240.61 | - |
| Total | 73,461,165.82 | - |
26. Accounts payable
| Item | 31/12/2023 | 31/12/2022 |
| Service fee | 246,400,717.07 | 299,350,272.24 |
| Material purchase fee | 117,170,447.10 | 132,460,163.17 |
| Construction fee | 100,672,753.10 | 110,687,325.42 |
| Equipment payments | 52,762,565.74 | 87,445,302.02 |
| Rental fee | 13,591,518.23 | 8,304,019.32 |
| Others | 161,167,136.01 | 172,902,315.49 |
| Total | 691,765,137.25 | 811,149,397.66 |
(1) Aging of accounts payable
| Aging | 31/12/2023 | 31/12/2022 | ||
| Amount | Proportion (%) | Amount | Proportion (%) | |
| Within 1 year | 617,528,837.76 | 89.27 | 710,976,970.28 | 87.65 |
| 1-2 years | 26,506,267.62 | 3.83 | 47,038,049.65 | 5.80 |
| 2-3 years | 30,254,034.46 | 4.37 | 26,667,189.69 | 3.29 |
| More than 3 years | 17,475,997.41 | 2.53 | 26,467,188.04 | 3.26 |
| Total | 691,765,137.25 | 100.00 | 811,149,397.66 | 100.00 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
26. Accounts payable - continued
(2) Significant accounts payable aged more than 1 year
CHINA MERCHANTS PORT GROUP CO., LTD.
Name of entity
| Name of entity | 31/12/2023 | Aging | Reason for outstanding or not being carried forward |
| Quanzhou Antong Logistics Co., Ltd. | 16,948,161.45 | 2-3 years | To be paid upon confirmation by both parties. |
27. Receipts in advance
| Item | 31/12/2023 | 31/12/2022 |
| Rental fee received in advance | 8,993,727.31 | 6,205,443.31 |
| Management fee received in advance | 2,659,217.99 | - |
| Others | 5,734,592.06 | 3,681,088.28 |
| Total | 17,387,537.36 | 9,886,531.59 |
(1) Aging of receipts in advance
| Aging | 31/12/2023 | 31/12/2022 | ||
| Amount | Proportion (%) | Amount | Proportion (%) | |
| Within 1 year | 17,387,537.36 | 100.00 | 9,884,079.59 | 99.98 |
| 1-2 years | - | - | - | - |
| 2-3 years | - | - | - | - |
| More than 3 years | - | - | 2,452.00 | 0.02 |
| Total | 17,387,537.36 | 100.00 | 9,886,531.59 | 100.00 |
(2) As at 31 December 2023, the Group has no significant receipts in advance aged more than
one year.
(3) As at 31 December 2023, the Group has no receipts in advance with significant changes in
carrying amount.
28 Contract liabilities
(1) Details of contract liabilities
| Item | 31/12/2023 | 31/12/2022 |
| Port charges received in advance | 84,869,413.45 | 55,045,635.27 |
| Service fee received in advance | 26,198,333.07 | 59,729,035.75 |
| Warehousing fee received in advance | 3,204,091.87 | 3,048,588.90 |
| Others | 27,808,262.61 | 24,076,291.11 |
| Total | 142,080,101.00 | 141,899,551.03 |
(2) There are no significant changes in carrying amount of contract liabilities during the year.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
28 Contract liabilities - continued
(3) As at 31 December 2023, the Group has no significant contract liabilities aged more than
one year.
(4) Qualitative analysis of contract liabilities
Contract liabilities mainly represent the amount received by the Group for the port services providedto customers. The payment is collected according to the time agreed in the contract. The Grouprecognizes contract revenue based on the progress of the contract. The contract liabilities will berecognized as revenue after the Group fulfils its performance obligations.
(5) Revenue recognized in the year and included in the carrying amount of contract liabilities
at the beginning of the year
An amount of RMB 91,180,530.23 included in the carrying amount of contract liabilities at thebeginning of 2023 has been recognized as revenue in the current year, including contract liabilitiesarising from settled but unfinished construction resulting from the contract of service fees receivedin advance amounting to RMB 24,937,772.66, contract liabilities arising from settled but unfinishedconstruction resulting from the contract of port charges received in advance amounting to RMB50,149,195.64, contract liabilities arising from settled but unfinished construction resulting fromcontract of warehousing fee received in advance amounting to RMB 3,048,588.90, and contractliabilities arising from settled but unfinished construction resulting from other contracts amountingto RMB 13,044,973.03.
29. Employee benefits payable
(1) Presentation of employee benefits payable
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 31/12/2022 | Effect of changes in the scope of consolidation | Increase for the year | Decrease for the year | 31/12/2023 |
| 1. Short-term benefits | 921,533,425.99 | -35,636,773.69 | 3,243,766,906.07 | 3,219,390,381.18 | 910,273,177.19 |
| 2. Post-employment benefits - defined contribution plan | 13,383,514.93 | -4,201,592.85 | 351,623,760.71 | 352,451,682.76 | 8,354,000.03 |
| 3. Termination benefits | 2,423,282.78 | - | 5,158,916.08 | 7,582,198.86 | - |
| 4. Other benefits due within 1 year | - | - | 4,053,449.56 | 4,053,449.56 | - |
| 5. Others | -505,505.57 | -631,121.04 | 5,145,597.17 | 4,671,541.13 | -662,570.57 |
| Total | 936,834,718.13 | -40,469,487.58 | 3,609,748,629.59 | 3,588,149,253.49 | 917,964,606.65 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
29. Employee benefits payable - continued
(2) Presentation of short-term benefits
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 31/12/2022 | Effect of changes in the scope of consolidation | Increase for the year | Decrease for the year | 31/12/2023 |
| 1. Wages and salaries, bonuses, allowances and subsidies | 897,442,262.83 | -33,339,184.53 | 2,606,547,914.19 | 2,586,737,715.36 | 883,913,277.13 |
| 2. Staff welfare | - | - | 169,221,198.72 | 169,221,198.72 | - |
| 3. Social insurance contributions | 10,545,539.44 | -891,098.34 | 204,136,593.97 | 199,978,211.04 | 13,812,824.03 |
| Including: Medical insurance | 8,631,543.96 | -836,747.58 | 173,636,271.40 | 170,223,587.11 | 11,207,480.67 |
| Work injury insurance | 53,916.77 | -54,350.76 | 17,211,021.96 | 17,210,587.97 | - |
| Others | 1,860,078.71 | - | 13,289,300.61 | 12,544,035.96 | 2,605,343.36 |
| 4. Housing funds | -95,060.47 | 274.00 | 198,040,769.72 | 198,042,657.10 | -96,673.85 |
| 5. Labour union and employee education funds | 13,642,129.96 | -1,406,764.82 | 50,814,109.87 | 50,314,255.40 | 12,735,219.61 |
| 6. Other short-term benefits | -1,445.77 | - | 15,006,319.60 | 15,096,343.56 | -91,469.73 |
| Total | 921,533,425.99 | -35,636,773.69 | 3,243,766,906.07 | 3,219,390,381.18 | 910,273,177.19 |
(3) Presentation of defined benefit plans
| Item | 31/12/2022 | Effect of changes in the scope of consolidation | Increase for the year | Decrease for the year | 31/12/2023 |
| I. Basic pension | 9,761,086.14 | -1,383,333.72 | 258,989,715.66 | 259,128,522.95 | 8,238,945.13 |
| II. Unemployment insurance | 49,026.91 | -49,434.91 | 6,077,524.71 | 6,077,116.71 | - |
| III. Enterprise annuity | 3,573,401.88 | -2,768,824.22 | 86,556,520.34 | 87,246,043.10 | 115,054.90 |
| Total | 13,383,514.93 | -4,201,592.85 | 351,623,760.71 | 352,451,682.76 | 8,354,000.03 |
The Company and its domestic subsidiaries participate in the pension insurance and unemploymentinsurance plan established by government institutions as required. According to such plans, theGroup contributes in proportion to the local government. The Group has established an enterpriseannuity system, and accrues and pays the enterprise annuity according to the enterprise annuitysystem of the Company and its domestic subsidiaries. In addition to above contributions, the Grouphas no further payment obligations. The corresponding expenses are included in profit or loss forthe period or the cost of related assets when incurred.
30. Taxes payable
| Item | 31/12/2022 | Effect of changes in the scope of consolidation | Provision for the year | Payment for the year | Effect of translation of financial statements denominated in foreign currencies | 31/12/2023 |
| Enterprise income tax | 804,846,345.79 | -3,002,884.36 | 1,123,434,326.28 | 1,108,672,570.98 | 3,089,589.10 | 819,694,805.83 |
| VAT | 30,032,002.80 | -613,554.49 | 205,611,948.35 | 215,161,352.07 | 352,761.87 | 20,221,806.46 |
| Other taxes | 83,054,820.50 | -4,006,342.06 | 522,874,894.04 | 522,097,230.12 | 3,310,817.85 | 83,136,960.21 |
| Total | 917,933,169.09 | -7,622,780.91 | 1,851,921,168.67 | 1,845,931,153.17 | 6,753,168.82 | 923,053,572.50 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
31. Other payables
(1) Presentation of other payables
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 31/12/2023 | 31/12/2022 |
| Dividends payable | 111,897,214.27 | 92,374,921.29 |
| Other payables | 1,542,724,955.75 | 1,663,510,336.97 |
| Total | 1,654,622,170.02 | 1,755,885,258.26 |
(2) Dividends payable
| Item | 31/12/2023 | 31/12/2022 |
| Ordinary share dividends | 111,897,214.27 | 92,374,921.29 |
| Including: China Merchants Zhangzhou Development Zone Co., Ltd. (Note) | 77,734,806.46 | 20,000,000.00 |
| Dalian Port Container Development Co., Ltd. ("Dalian Port Container") | 16,160,696.61 | 14,000,000.00 |
| Dalian Port Jifa Logistics Co., Ltd. | 9,575,104.42 | 3,000,000.00 |
| Yingkou Port Group Co., Ltd. ("Yingkou Port Group") | 5,372,456.78 | - |
| Yiu Lian Dockyards Limited | 2,334,150.00 | - |
| Qingdao Port (Group) Co., Ltd. | 720,000.00 | - |
| Zhanjiang Infrastructure Construction Investment Group Co., Ltd. | - | 41,400,234.06 |
| Sri Lanka Ports Authority | - | 10,446,900.00 |
| Dalian City Construction Investment Group Co., Ltd (formerly known as Dalian City Investment Holding Group Co., Ltd. ) | - | 3,527,787.23 |
Note: As at 31 December 2023, the Group has no significant dividends payable aged more than
one year.
(3) Other payables
(a) Disclosure of other payables by nature
| Item | 31/12/2023 | 31/12/2022 |
| Amount payable for construction and quality warranty | 575,941,472.21 | 643,816,817.51 |
| Guarantees and deposits | 246,316,308.32 | 221,628,920.81 |
| Accrued expenses | 139,920,340.25 | 190,048,988.98 |
| Customer discount | 129,780,042.30 | 164,622,341.62 |
| Port construction and security fee | 27,939,655.23 | 36,697,168.04 |
| Balance of payment for transfer of land use rights | - | 11,295,700.00 |
| Others | 422,827,137.44 | 395,400,400.01 |
| Total | 1,542,724,955.75 | 1,663,510,336.97 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
31. Other payables - continued
(3) Other payables - continued
(b) Significant other payables aged more than one year or past due
CHINA MERCHANTS PORT GROUP CO., LTD.
Company name
| Company name | Amount payable | Aging | Reason for being outstanding |
| Transport Bureau of Shenzhen Municipality (Ports Administration of Shenzhen Municipality) | 79,679,948.23 | 1-2 years and more than 3 years | To be paid upon confirmation by both parties |
| CCCC Water Transport Planning and Design Institute Co., Ltd. | 58,666,012.94 | 1-2 years, 2-3 years and more than 3 years | To be paid upon confirmation by both parties |
| Lac Assal Investment Holding Company Limited | 48,162,348.73 | 1-2 years | To be paid upon confirmation by both parties |
| Shanghai Zhenhua Heavy Industries Co., Ltd. | 37,248,716.35 | 1-2 years and more than 3 years | The contracted settlement condition has not been reached |
| Shantou Transportation Bureau | 31,358,355.47 | More than 3 years | To be paid upon confirmation by both parties |
| Wuxi Huadong Heavy Machinery Co., Ltd. | 10,090,410.68 | 2-3 years | To be paid upon confirmation by both parties |
| China Merchants Real Estate (Shenzhen) Co., Ltd. | 10,079,369.00 | More than 3 years | To be paid upon confirmation by both parties |
| Guangdong Groton Group Co., Ltd. (formerly known as Guangdong Hengtai Guotong Industrial Co., Ltd.) | 10,000,000.00 | More than 3 years | The contracted settlement condition has not been reached |
| Shantou Finance Bureau | 10,000,000.00 | More than 3 years | To be paid upon confirmation by both parties |
| Total | 295,285,161.40 | —— | —— |
32. Non-current liabilities due within one year
| Item | 31/12/2023 | 31/12/2022 |
| Long-term borrowings due within one year (Note VIII, 34) | 1,033,008,184.01 | 2,313,191,859.96 |
| Including: Credit borrowings | 532,282,391.00 | 1,368,934,869.99 |
| Guaranteed borrowings | 410,725,775.58 | 219,564,028.82 |
| Mortgage and pledged borrowings | 30,352,589.61 | 715,461,578.62 |
| Guaranteed and mortgage borrowings | 59,647,427.82 | 9,231,382.53 |
| Bonds payable due within one year (Note VIII, 35) | 5,267,490,749.32 | 8,668,651,537.27 |
| Lease liabilities due within one year (Note VIII, 36) | 248,634,286.86 | 306,942,164.80 |
| Long-term payables due within one year (Note VIII, 37) | 184,534,373.50 | 155,665,725.85 |
| Long-term employee benefits payable due within one year (Note VIII, 38) | 49,730,825.21 | 54,414,877.57 |
| Other non-current liabilities due within one year (Note VIII, 41) | 34,005,870.35 | 142,357,523.50 |
| Total | 6,817,404,289.25 | 11,641,223,688.95 |
33. Other current liabilities
(1) Details of other current liabilities
| Item | 31/12/2023 | 31/12/2022 |
| Short-term bonds payable | 2,007,190,136.98 | 3,017,713,424.64 |
| Accrued professional agency fee | 114,638,017.33 | 124,799,040.22 |
| Others | 22,014,380.22 | 18,635,061.10 |
| Total | 2,143,842,534.53 | 3,161,147,525.96 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
33. Other current liabilities - continued
(2) Changes in short-term bonds payable
CHINA MERCHANTS PORT GROUP CO., LTD.
Name of bond
| Name of bond | Face value | Coupon rate | Date of issue | Term of the bond | Amount of issue | 31/12/2022 | Amount issued in the current year | Interest accrued based on par value | Amortization of premiums or discounts | Repayment in the current year | 31/12/2023 | Is it in breach of contract? |
| 2.43% RMB 2 billion Super & Short-term Commercial Paper | 2,000,000,000.00 | 2.43% | 2023-11-7 | 90 days | 2,000,000,000.00 | - | 2,000,000,000.00 | 7,190,136.98 | - | - | 2,007,190,136.98 | No |
| 2.35% RMB 2 billion Super & Short-term Commercial Paper | 2,000,000,000.00 | 2.35% | 2023-3-1 | 180 days | 2,000,000,000.00 | - | 2,000,000,000.00 | 23,114,754.10 | - | 2,023,114,754.10 | - | No |
| 2.05% RMB 2 billion Super & Short-term Commercial Paper | 2,000,000,000.00 | 2.05% | 2023-6-14 | 180 days | 2,000,000,000.00 | - | 2,000,000,000.00 | 20,163,934.43 | - | 2,020,163,934.43 | - | No |
| 1.75% RMB 1 billion Super & Short-term Commercial Paper | 1,000,000,000.00 | 1.75% | 2022-9-1 | 270 days | 1,000,000,000.00 | 1,005,657,534.24 | - | 7,287,671.24 | - | 1,012,945,205.48 | - | No |
| 1.93% RMB 2 billion Super & Short-term Commercial Paper | 2,000,000,000.00 | 1.93% | 2022-9-8 | 180 days | 2,000,000,000.00 | 2,012,055,890.40 | - | 6,979,725.60 | - | 2,019,035,616.00 | - | No |
| Total | 9,000,000,000.00 | — — | — — | — — | 9,000,000,000.00 | 3,017,713,424.64 | 6,000,000,000.00 | 64,736,222.35 | - | 7,075,259,510.01 | 2,007,190,136.98 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
34. Long-term borrowings
CHINA MERCHANTS PORT GROUP CO., LTD.
Category
| Category | 31/12/2023 | 31/12/2022 | Range of year-end interest rate |
| Credit borrowings | 16,857,281,855.60 | 12,319,883,867.05 | 1.20%-3.80% |
| Guaranteed borrowings (Note 1) | 845,725,775.58 | 1,020,670,858.02 | 2.95%-12.90% |
| Mortgage and pledged borrowings (Note 2) | 314,794,387.22 | 1,082,723,114.44 | 3.40%-3.96% |
| Guaranteed and mortgage borrowings (Note 3) | 1,242,750,120.32 | 280,013,198.30 | 2.95% |
| Total | 19,260,552,138.72 | 14,703,291,037.81 | — — |
| Less: Long-term borrowings due within one year | 1,033,008,184.01 | 2,313,191,859.96 | — — |
| Including: Credit borrowings | 532,282,391.00 | 1,368,934,869.99 | — — |
| Guaranteed borrowings | 410,725,775.58 | 219,564,028.82 | — — |
| Mortgage and pledged borrowings | 30,352,589.61 | 715,461,578.62 | — — |
| Guaranteed and mortgage borrowings | 59,647,427.82 | 9,231,382.53 | |
| Long-term borrowings due after one year | 18,227,543,954.71 | 12,390,099,177.85 | — — |
Note 1: The borrowings are guaranteed by Shenzhen Magang Godown & Wharf Co., Ltd., China
Merchants Port (Shenzhen) Co., Ltd. and CM Port.
Note 2: On 31 December 2023, the Group obtained the long-term borrowings of RMB
314,794,387.22(31 December 2022: RMB 1,082,723,114.44) with the land with propertyright, fixed assets and construction in progress of Yide Port Co., Ltd. ("Yide Port"), aswell as the land with property right of Guangdong Shunkong Port Development andConstruction Co., Ltd. ("Shunkong Port"), as collaterals.
Note 3: On 31 December 2023, Shenzhen Haixing Harbor Development Co., Ltd. ("Shenzhen
Haixing") obtained the long-term borrowings of RMB 1,242,750,120.32 (31 December2022: RMB 280,013,198.30) with the land with property right as collaterals, and theborrowings are guaranteed by CM Port and Sinotrans South China Co., Ltd.
Details of mortgage and pledged borrowings are as follows:
| Company name | 31/12/2023 | 31/12/2022 | Collateral and pledge |
| Bank of China Qianhai Shekou Branch | 1,242,750,120.32 | 280,013,198.30 | Land use rights of Shenzhen Haixing |
| China Construction Bank Shunde Branch | 206,239,867.27 | 236,479,995.32 | Land use rights and fixed assets of Yide Port |
| Bank of Communications Co., Ltd. Guangdong Branch | 108,554,519.95 | - | Land use rights (Phase II) of Shunde |
| China Development Bank Corporation | - | 494,997,308.55 | The Group's entire equity in CICT |
| International Finance Corporation | - | 123,849,460.76 | The Group's entire equity in TML |
| African Development Bank | - | 56,864,864.36 | |
| Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden N.V. | - | 46,859,749.65 | |
| The OpecFund For International Development | - | 40,139,904.25 | |
| Societe de Promotion et de Participation pour la Cooperation Economique S.A. | - | 40,170,265.09 | |
| Deutsche Investitions-und Entwicklungsgesellschaft MBH | - | 33,449,920.21 | |
| China Minsheng Bank Co., Ltd. Zhoushan Branch | - | 9,911,646.25 | Land use rights and fixed assets of Zhoushan RoRo |
| Total | 1,557,544,507.54 | 1,362,736,312.74 |
Note: See Note (VIII) 64 for the above mortgages and pledges.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
35. Bonds payable
(1) Bonds payable
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 31/12/2023 | 31/12/2022 |
| 5.000% USD 600 million corporate bond | 4,304,565,371.23 | 4,227,154,465.35 |
| 4.750% USD 500 million corporate bond | 3,605,285,143.36 | 3,542,544,662.47 |
| 4.000% USD 500 million corporate bond | 3,544,024,689.32 | 3,482,186,896.02 |
| 2.690% RMB 3 billion corporate bond | 3,027,415,890.40 | 3,027,415,890.40 |
| 2.450% RMB 3 billion corporate bond | 3,023,560,273.97 | 3,023,560,273.97 |
| 3.520% RMB 2 billion corporate bond | 2,050,147,945.19 | 2,050,147,945.19 |
| 4.375% USD 900 million corporate bond | - | 6,371,347,105.64 |
| 3.360% RMB 2 billion corporate bond | - | 2,032,587,397.25 |
| Total | 19,554,999,313.47 | 27,756,944,636.29 |
| Less: Bonds payable due within one year | 5,267,490,749.32 | 8,668,651,537.27 |
| Bonds payable due after one year | 14,287,508,564.15 | 19,088,293,099.02 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
35. Bonds payable - continued
(2) Details of bonds payable
CHINA MERCHANTS PORT GROUP CO., LTD.
Name of bonds
| Name of bonds | Face value | Coupon rate | Date of issue | Term of the bond | Amount of issue | 31/12/2022 | Amount issued in the current year | Interest accrued based on par value | Amortization of premiums or discounts | Repayment in current year | Effect of translation of financial statements denominated in foreign currencies | 31/12/2023 | Is it in breach of contract? |
| 4.375% USD 900 million corporate bond | USD 900,000,000.00 | 4.3750% | 2018-8-6 | 5 years | USD 900,000,000.00 | 6,371,347,105.64 | - | 165,969,062.10 | 7,181,597.31 | 6,594,432,388.71 | 49,934,623.66 | - | No |
| 5.000% USD 600 million corporate bond | USD 600,000,000.00 | 5.0000% | 2018-8-6 | 10 years | USD 600,000,000.00 | 4,227,154,465.35 | - | 211,325,733.29 | 5,708,335.36 | 211,183,578.27 | 71,560,415.50 | 4,304,565,371.23 | No |
| 4.750% USD 500 million corporate bond | USD 500,000,000.00 | 4.7500% | 2015-8-3 | 10 years | USD 500,000,000.00 | 3,542,544,662.47 | - | 167,360,385.31 | 2,662,117.20 | 167,360,385.38 | 60,078,363.76 | 3,605,285,143.36 | No |
| 3.360% RMB 2 billion corporate bond | 2,000,000,000.00 | 3.3600% | 2020-7-7 | 3 years | 2,000,000,000.00 | 2,032,587,397.25 | - | 34,612,602.75 | - | 2,067,200,000.00 | - | - | No |
| 3.520% RMB 2 billion corporate bond | 2,000,000,000.00 | 3.5200% | 2021-4-14 | 3 years | 2,000,000,000.00 | 2,050,147,945.19 | - | 70,400,000.00 | - | 70,400,000.00 | - | 2,050,147,945.19 | No |
| 4.000% USD 500 million corporate bond | USD 500,000,000.00 | 4.0000% | 2022-6-1 | 5 years | USD 500,000,000.00 | 3,482,186,896.02 | - | 140,882,105.54 | 2,781,931.67 | 140,841,532.67 | 59,015,288.76 | 3,544,024,689.32 | No |
| 2.690% RMB 3 billion corporate bond | 3,000,000,000.00 | 2.6900% | 2022-8-29 | 3 years | 3,000,000,000.00 | 3,027,415,890.40 | - | 80,700,000.00 | - | 80,700,000.00 | - | 3,027,415,890.40 | No |
| 2.450% RMB 3 billion corporate bond | 3,000,000,000.00 | 2.4500% | 2022-9-5 | 2 years | 3,000,000,000.00 | 3,023,560,273.97 | - | 73,500,000.00 | - | 73,500,000.00 | - | 3,023,560,273.97 | No |
| Total | — — | — — | — — | — — | — — | 27,756,944,636.29 | - | 944,749,888.99 | 18,333,981.54 | 9,405,617,885.03 | 240,588,691.68 | 19,554,999,313.47 | No |
| Less: Bonds payable due within one year | — — | — — | — — | — — | — — | 8,668,651,537.27 | — — | — — | — — | — — | 5,267,490,749.32 | — — | |
| Bonds payable due after one year | — — | — — | — — | — — | — — | 19,088,293,099.02 | — — | — — | — — | — — | 14,287,508,564.15 | — — |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
36. Lease liabilities
(1) Lease liabilities
CHINA MERCHANTS PORT GROUP CO., LTD.Category
| Category | 31/12/2023 | 31/12/2022 |
| Lease payment | 2,782,133,802.80 | 1,963,098,776.36 |
| Unrecognized financing cost | -1,532,327,309.02 | -707,805,697.52 |
| Total | 1,249,806,493.78 | 1,255,293,078.84 |
| Less: Lease liabilities due within one year | 248,634,286.86 | 306,942,164.80 |
| Lease liabilities due after one year | 1,001,172,206.92 | 948,350,914.04 |
(2) Maturity of lease liabilities
| Item | 31/12/2023 |
| Minimum lease payments under non-cancellable leases: | |
| 1st year subsequent to the balance sheet date | 298,065,006.16 |
| 2nd year subsequent to the balance sheet date | 91,365,497.12 |
| 3rd year subsequent to the balance sheet date | 86,669,003.03 |
| Subsequent years | 2,306,034,296.49 |
| Total | 2,782,133,802.80 |
The Group is not exposed to any significant liquidity risk associated with lease liabilities.
37. Long-term payables
(1) Presentation of long-term payables
| Item | 31/12/2023 | 31/12/2022 |
| Long-term payables | 4,001,789,922.65 | 3,698,632,219.45 |
| Special payables | 5,606,653.02 | 8,349,096.71 |
| Total | 4,007,396,575.67 | 3,706,981,316.16 |
| Less: Long-term payables due within one year | 184,534,373.50 | 155,665,725.85 |
| Long-term payables due after one year | 3,822,862,202.17 | 3,551,315,590.31 |
(2) Long-term payables
| Item | 31/12/2023 | 31/12/2022 |
| Terminal management rights (Note) | 3,958,393,516.47 | 3,657,579,951.15 |
| Others | 43,396,406.18 | 41,052,268.30 |
| Total | 4,001,789,922.65 | 3,698,632,219.45 |
| Less: Long-term payables due within one year | 184,534,373.50 | 155,665,725.85 |
| Long-term payables due after one year | 3,817,255,549.15 | 3,542,966,493.60 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
37. Long-term payables - continued
(2) Long-term payables - continued
Note: Mainly from CICT and TCP terminal management rights purchased. On 12 August 2011, the
Group reached a 35-year building, operation and transfer agreement through the subsidiary CICTand Sri Lanka Port Authority on the building, operation, management and development ofColombo Port South Container Terminal (hereinafter referred to as "BOT"). The above-mentioned amount payable for the acquisition of terminal management rights is determined bydiscounting the amount to be paid in the future using the prevailing market interest rate accordingto the BOT agreement. As at 31 December 2023, the amount payable for the acquisition ofterminal management rights is RMB 876,500,567.56.
TCP, a subsidiary of the Company, entered into a franchise agreement on the Port ofParanaguá with the Administration of the Ports of Paranaguá and Antonina- APPA(hereinafter referred to as "APPA"). The agreement provides for an initial term of 25 yearsfor the franchising rights. In April 2016, TCP and APPA entered into the SupplementalAgreement, which extends the term to 50 years and will be expired in October 2048.
On 9 September 2021, TCP, a subsidiary of the Company, entered into a supplementalagreement to the Lease Agreement with APPA for the franchising rights of the Ports ofParanaguá and Antonina, pursuant to which the base figure for the calculation of franchisingrights for the Ports of Paranaguá and Antonina was adjusted from Brazil IGP-M InflationIndex ("IGP-M index") to the Extended National Consumer Price Index ("IPCA index") ofBrazilian Institute of Geography and Statistics("IBGE"). In November 2021, TCPreadjusted the franchising rights using the IPCA index. As at 31 December 2023, the amountof franchising rights payable was RMB 3,081,892,948.91.
(3) Special payables
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 31/12/2022 | Increase for the year | Decrease for the year | Effect of changes in the scope of consolidation | 31/12/2023 | Reason |
| Employee housing fund | 5,126,641.68 | 480,061.34 | 50.00 | - | 5,606,653.02 | Note |
| Innovation workshop for model workers | 3,222,455.03 | - | - | -3,222,455.03 | - | |
| Total | 8,349,096.71 | 480,061.34 | 50.00 | -3,222,455.03 | 5,606,653.02 |
Note: This represents the repairing fund for public areas and public facilities and equipment
established after the Group sells the public-owned house on the collectively allocated landto employees. The fund is contributed by all the employees having ownership of the houseaccording to the rules and is specially managed and used for specific purpose.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
38. Long-term employee benefits payable
(1) Long-term employee benefits payable
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 31/12/2023 | 31/12/2022 |
| Post-employment benefits - net liabilities of defined benefit plans | 509,605,071.25 | 516,950,669.03 |
| Termination benefits | 58,098,932.22 | 64,274,552.96 |
| Others (Note) | 85,036,743.65 | 112,285,587.01 |
| Total | 652,740,747.12 | 693,510,809.00 |
| Less: Long-term employee benefits payable due within one year | 49,730,825.21 | 54,414,877.57 |
| Long-term employee benefits payable due after one year | 603,009,921.91 | 639,095,931.43 |
Note: This represents the employee relocation costs of the Company's subsidiary Shantou Port in
connection with land acquisition and reservation.
(2) Changes in defined benefit plans
Present value of defined benefit plan obligations:
| Item | 2023 | 2022 |
| I. Opening balance | 516,950,669.03 | 463,858,274.44 |
| II. Defined benefit cost included in profit or loss for the period | 31,630,084.71 | 24,392,165.72 |
| 1. Current service cost | 14,097,094.50 | 11,191,538.44 |
| 2. Past service cost | 2,420,000.00 | - |
| 3. Interest adjustment | 15,112,990.21 | 13,200,627.28 |
| III. Defined benefit cost included in other comprehensive income | -22,975,434.75 | 50,820,198.04 |
| 1. Actuarial gains | -23,856,287.15 | 49,959,657.35 |
| 2. Effect of exchange rate changes | 880,852.40 | 860,540.69 |
| IV. Other changes | -16,000,247.74 | -22,119,969.17 |
| 1. Benefits paid | -16,000,247.74 | -22,119,969.17 |
| 2. Changes in the scope of consolidation | - | - |
| V. Closing balance | 509,605,071.25 | 516,950,669.03 |
The Company's subsidiaries provide the registered retirees and in-service staff with supplementarypost-employment benefit plans.
The Group hired a third-party actuary to estimate the present value of the above-mentionedretirement benefit plan obligations in an actuarial manner based on the expected cumulative welfareunit method. The Group recognizes the liabilities based on the actuarial results. The relevantactuarial gains or losses are included in other comprehensive income and cannot be reclassified intoprofit or loss in the future. Past service costs are recognized in profit or loss for the period in whichthe plan is revised. The net interest is determined by multiplying the defined benefit plan net debtor net assets by the appropriate discount rate.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
39. Provisions
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 31/12/2022 | Increase for the year | Decrease for the year | Effect of translation of financial statements denominated in foreign currencies | 31/12/2023 | Reason |
| Pending litigation | 35,365,156.43 | 52,650,477.00 | 7,489,688.34 | 5,064,114.32 | 85,590,059.41 | Note |
| Sales discount | - | 179,125,657.39 | 179,125,657.39 | - | - | |
| Total | 35,365,156.43 | 231,776,134.39 | 186,615,345.73 | 5,064,114.32 | 85,590,059.41 |
Note: This represents the estimated compensation amount that the Company's subsidiary TCP may
need to pay due to the pending litigation.
40. Deferred income
| Item | 31/12/2022 | Increase for the year | Decrease for the year | 31/12/2023 |
| Government grants | 1,031,273,189.74 | 41,207,834.25 | 47,704,466.26 | 1,024,776,557.73 |
| Total | 1,031,273,189.74 | 41,207,834.25 | 47,704,466.26 | 1,024,776,557.73 |
41. Other non-current liabilities
| Item | 31/12/2023 | 31/12/2022 |
| Actuarial cost for the calculation of pension benefit difference for the public security bureau staff (Note 1) | 198,642,177.67 | 175,742,813.67 |
| Related party borrowings (Note 2) | 11,945,870.35 | 3,162,000.00 |
| Third party borrowings (Note 2) | - | 143,755,523.50 |
| Berth priority call right (Note 3) | 439,990.79 | 4,480,217.05 |
| Others | 2,612,095.27 | 1,600,086.28 |
| Total | 213,640,134.08 | 328,740,640.50 |
| Less: Other non-current liabilities due within one year | 34,005,870.35 | 142,357,523.50 |
| Including: Actuarial cost for the calculation of pension benefits difference for the public security bureau staff | 22,060,000.00 | 15,440,000.00 |
| Related party borrowings | 11,945,870.35 | 3,162,000.00 |
| Third party borrowings | - | 123,755,523.50 |
| Other non-current liabilities due after one year | 179,634,263.73 | 186,383,117.00 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
41. Other non-current liabilities - continued
Note 1: It represents the transfer of Zhanjiang Port Public Security Bureau to the People's
Government of Zhanjiang Municipality by Zhanjiang Port, a subsidiary of the Company,in 2020 in accordance with the Notice on the Issuance of the Program on Deepening theManagement System Reform of Ganghang Public Security Organs (Zhong Yang Bian BanFa No. 327 (2017)) and the Notice on the Issuance of the Implementation Plan forDeepening the Management System Reform of Ganghang Public Security Organs inGuangdong Province (Yue Ji Bian Ban Fa No. 221 (2018)). The former in-service policeofficers of Zhanjiang Port Public Security Bureau were transferred as civil servants inaccordance with state regulations, the retired police officers were included in the scope ofpension insurance of the government departments and public institutions in Zhanjiang,and the difference between the pension benefits under the original standard and theretirement benefits of Zhanjiang municipal police officers (the "pension benefitdifference") was borne by Zhanjiang Port.
Shantou Port, a subsidiary of the Company, transferred Shantou Municipal Public SecurityBureau Ganghang Branch (formerly, the Shantou Port Public Security Bureau) to ShantouMunicipal Government, and Shantou Municipal Public Security Bureau Ganghang Branchwas fully taken over by Shantou Municipal Public Security Bureau. The in-service policeofficers were transferred as civil servants in accordance with state regulations, the retiredpolice officers were included in the scope of pension insurance of the governmentdepartments and public institutions in Shantou, and the pension benefit difference wasborne by Shantou Port.
Note 2: It represents the principal and interest on borrowings of the subsidiary of the Company
Shunkong Port from its minority shareholder Guangdong Shunkong City Investment RealEstate Co., Ltd. and its related party Guangdong Shunkong Transportation Investment Co.,Ltd.
Note 3: It represents the berth priority call right as agreed in the contract entered into with the
customers in 2003, with total amount of USD14 million. The Group must give priority tothe berthing requirements of the contracted customers during the contract period. ChiwanContainer Terminal amortized the berth priority call right over 20 years using straight-linemethod.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
42. Share capital
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 31/12/2022 | Changes for the year | 31/12/2023 | ||||
| New issue of share | Bonus issue | Capitalization of surplus reserve | Others | Sub-total | |||
| 2023 | |||||||
| I. Restricted tradable shares | — — | — — | — — | — — | — — | — — | — — |
| 1. State-owned shares | - | - | - | - | - | - | - |
| 2. State-owned corporate shares | 576,709,537.00 | - | - | - | - | - | 576,709,537.00 |
| 3. Other domestic shares | 7,366.00 | - | - | - | -7,366.00 | -7,366.00 | - |
| 4. Foreign shares | - | - | - | - | - | - | - |
| Total restricted tradable shares | 576,716,903.00 | - | - | - | -7,366.00 | -7,366.00 | 576,709,537.00 |
| II. Non-restricted tradable shares | — — | — — | — — | — — | — — | — — | — — |
| 1. Ordinary shares denominated in RMB | 1,742,468,718.00 | - | - | - | 976.00 | 976.00 | 1,742,469,694.00 |
| 2. Foreign capital shares listed domestically | 179,889,040.00 | - | - | - | 6,390.00 | 6,390.00 | 179,895,430.00 |
| 3. Foreign capital shares listed overseas | - | - | - | - | - | - | - |
| 4. Others | - | - | - | - | - | - | - |
| Total non-restricted tradable shares | 1,922,357,758.00 | - | - | - | 7,366.00 | 7,366.00 | 1,922,365,124.00 |
| III. Total shares | 2,499,074,661.00 | - | - | - | - | - | 2,499,074,661.00 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
42. Share capital - continued
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 31/12/2021 | Changes for the year | 31/12/2022 | ||||
| New issue of share | Bonus issue | Capitalization of surplus reserve | Others | Sub-total | |||
| 2022 | |||||||
| I. Restricted tradable shares | — — | — — | — — | — — | — — | — — | — — |
| 1. State-owned shares | - | - | - | - | - | - | - |
| 2. State-owned corporate shares | - | 576,709,537.00 | - | - | - | 576,709,537.00 | 576,709,537.00 |
| 3. Other domestic shares | 9,821.00 | - | - | - | -2,455.00 | -2,455.00 | 7,366.00 |
| 4. Foreign shares | 1,148,648,648.00 | - | - | - | -1,148,648,648.00 | -1,148,648,648.00 | - |
| Total restricted tradable shares | 1,148,658,469.00 | 576,709,537.00 | - | - | -1,148,651,103.00 | -571,941,566.00 | 576,716,903.00 |
| II. Non-restricted tradable shares | — — | — — | — — | — — | — — | — — | — — |
| 1. Ordinary shares denominated in RMB | 593,819,745.00 | - | - | - | 1,148,648,973.00 | 1,148,648,973.00 | 1,742,468,718.00 |
| 2. Foreign capital shares listed domestically | 179,886,910.00 | - | - | - | 2,130.00 | 2,130.00 | 179,889,040.00 |
| 3. Foreign capital shares listed overseas | - | - | - | - | - | - | - |
| 4. Others | - | - | - | - | - | - | - |
| Total non-restricted tradable shares | 773,706,655.00 | - | - | - | 1,148,651,103.00 | 1,148,651,103.00 | 1,922,357,758.00 |
| III. Total shares | 1,922,365,124.00 | 576,709,537.00 | - | - | - | 576,709,537.00 | 2,499,074,661.00 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
43. Capital Reserve
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 31/12/2022 | Increase | Decrease | 31/12/2023 |
| 2023 | ||||
| I. Capital premium | 34,208,812,963.50 | 2,244,317,625.22 | - | 36,453,130,588.72 |
| Including: Capital contributed by investors | 17,068,816,277.34 | - | - | 17,068,816,277.34 |
| Differences arising from business combination involving enterprises under common control | 13,302,937,205.73 | - | - | 13,302,937,205.73 |
| Differences arising from acquisition of minority interests (Note 1) | 2,165,423,814.02 | 2,242,433,715.25 | - | 4,407,857,529.27 |
| Others | 1,671,635,666.41 | 1,883,909.97 | - | 1,673,519,576.38 |
| II. Other capital reserve | 542,827,871.75 | 104,628,733.77 | 23,740,391.18 | 623,716,214.34 |
| Including: Transfer from capital reserve under the previous accounting system | -2,781,133.00 | - | - | -2,781,133.00 |
| Unexercised share-based payment (Note 2) | 5,591,402.00 | 1,528,712.73 | 475,524.37 | 6,644,590.36 |
| Other changes in owners' equity of the investee under equity method other than changes in net profit or loss, profit distribution and other comprehensive income | 540,017,602.75 | 103,100,021.04 | 23,264,866.81 | 619,852,756.98 |
| Total | 34,751,640,835.25 | 2,348,946,358.99 | 23,740,391.18 | 37,076,846,803.06 |
| 2022 | ||||
| I. Capital premium | 23,189,922,809.62 | 11,018,890,153.88 | - | 34,208,812,963.50 |
| Including: Capital contributed by investors | 7,012,992,483.94 | 10,055,823,793.40 | - | 17,068,816,277.34 |
| Differences arising from business combination involving enterprises under common control | 13,302,937,205.73 | - | - | 13,302,937,205.73 |
| Differences arising from acquisition of minority interests | 1,215,209,939.74 | 950,213,874.28 | - | 2,165,423,814.02 |
| Others | 1,658,783,180.21 | 12,852,486.20 | - | 1,671,635,666.41 |
| II. Other capital reserve | 402,779,949.08 | 151,303,029.21 | 11,255,106.54 | 542,827,871.75 |
| Including: Transfer from capital reserve under the previous accounting system | -2,781,133.00 | - | - | -2,781,133.00 |
| Unexercised share-based payment | 9,956,938.60 | 5,617,671.30 | 9,983,207.90 | 5,591,402.00 |
| Other changes in owners' equity of the investee under equity method other than changes in net profit or loss, profit distribution and other comprehensive income | 395,604,143.48 | 145,685,357.91 | 1,271,898.64 | 540,017,602.75 |
| Total | 23,592,702,758.70 | 11,170,193,183.09 | 11,255,106.54 | 34,751,640,835.25 |
Note 1: The changes for the year mainly represent the dividends attributable to CM Port that the
Company chose to acquire in the form of share replacement and shareholding increase,which increased the capital reserve by RMB 2,269,118,327.61. Refer to Note (XI) 2 fordetails.
Note 2: Refer to Note (XVI) 2 for details.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
44. Other comprehensive income
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 31/12/2022 | 2023 | Other changes | 31/12/2023 | |||||
| Pre-tax amount for the year | Less: Amount included in other comprehensive income in the prior period but transferred to profit or loss in the current period | Less: Amount included in other comprehensive income in the prior period but transferred to retained earnings in the current period | Less: Income tax expenses | Attributable to the Company, net of tax | Attributable to minority shareholders, net of tax | ||||
| 2023 | |||||||||
| I. Other comprehensive income that will not be reclassified subsequently to profit or loss | 51,014,303.06 | 60,755,557.83 | - | - | 846,996.46 | -73,874,071.89 | 133,782,633.26 | - | -22,859,768.83 |
| Including: Changes arising from remeasurement of defined benefit plans | -10,189,712.88 | 25,003,573.00 | - | - | - | 7,480,103.34 | 17,523,469.66 | - | -2,709,609.54 |
| Other comprehensive income that can't be reclassified to profit or loss under equity method | -8,907,673.34 | 32,473,509.74 | - | - | - | -83,841,725.07 | 116,315,234.81 | - | -92,749,398.41 |
| Changes in fair value of other equity instruments | 70,111,689.28 | 3,278,475.09 | - | - | 846,996.46 | 2,487,549.84 | -56,071.21 | - | 72,599,239.12 |
| II. Other comprehensive income that will be reclassified subsequently to profit or loss | -740,567,922.92 | 149,948,207.40 | - | - | - | -140,198,902.60 | 290,147,110.00 | - | -880,766,825.52 |
| Including: Other comprehensive income that may be reclassified to profit or loss under equity method | -60,762,188.43 | -767,504,700.07 | - | - | - | -366,028,318.84 | -401,476,381.23 | - | -426,790,507.27 |
| Translation differences of financial statements denominated in foreign currencies | -679,805,734.49 | 917,452,907.47 | - | - | - | 225,829,416.24 | 691,623,491.23 | - | -453,976,318.25 |
| Total other comprehensive income | -689,553,619.86 | 210,703,765.23 | - | - | 846,996.46 | -214,072,974.49 | 423,929,743.26 | - | -903,626,594.35 |
| 2022 (Restated) | |||||||||
| I. Other comprehensive income that will not be reclassified subsequently to profit or loss | 81,233,996.26 | -72,230,027.20 | - | - | 329,334.05 | -22,706,023.29 | -49,853,337.96 | 7,513,669.91 | 51,014,303.06 |
| Including: Changes arising from remeasurement of defined benefit plans | 2,603,415.85 | -49,039,668.45 | - | - | - | -12,793,128.73 | -36,246,539.72 | - | -10,189,712.88 |
| Other comprehensive income that can't be reclassified to profit or loss under equity method | 2,643,088.68 | -25,906,733.50 | - | - | - | -11,550,762.02 | -14,355,971.48 | - | -8,907,673.34 |
| Changes in fair value of other equity instruments | 75,987,491.73 | 2,716,374.75 | - | - | 329,334.05 | 1,637,867.46 | 749,173.24 | 7,513,669.91 | 70,111,689.28 |
| II. Other comprehensive income that will be reclassified subsequently to profit or loss | -971,359,314.44 | 1,701,191,299.27 | - | - | - | 230,791,391.52 | 1,470,399,907.75 | - | -740,567,922.92 |
| Including: Other comprehensive income that may be reclassified to profit or loss under equity method | 49,431,519.10 | -246,633,232.89 | - | - | - | -110,193,707.53 | -136,439,525.36 | - | -60,762,188.43 |
| Translation differences of financial statements denominated in foreign currencies | -1,020,790,833.54 | 1,947,824,532.16 | - | - | - | 340,985,099.05 | 1,606,839,433.11 | - | -679,805,734.49 |
| Total other comprehensive income | -890,125,318.18 | 1,628,961,272.07 | - | - | 329,334.05 | 208,085,368.23 | 1,420,546,569.79 | 7,513,669.91 | -689,553,619.86 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
45. Special reserve
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 31/12/2022 | Increase | Decrease | 31/12/2023 |
| Safety production cost | 26,358,259.97 | 61,589,514.21 | 53,943,779.77 | 34,003,994.41 |
46. Surplus reserve
| Item | 31/12/2022 | Increase | Decrease | 31/12/2023 |
| Statutory surplus reserve | 1,001,917,449.15 | 94,063,114.53 | - | 1,095,980,563.68 |
47. Unappropriated profit
| Item | Amount | Proportion of appropriation or allocation |
| 2023 | ||
| Unappropriated profit at the beginning of the year before adjustment | 16,679,688,347.09 | |
| Add: Adjustment to unappropriated profit at beginning of the year | 22,299,954.05 | |
| Including: Changes in accounting policies | 22,299,954.05 | |
| Unappropriated profit at the beginning of the year after adjustment | 16,701,988,301.14 | |
| Add: Net profit of the year attributable to shareholders of the Company | 3,571,800,762.16 | |
| Unappropriated profit carried forward from other comprehensive income | - | |
| Less: Transfer to statutory surplus reserve in the current year | 94,063,114.53 | |
| Transfer to discretionary surplus reserve in the current year | - | |
| Ordinary shares' dividends payable | 1,124,583,597.45 | Note 1 |
| Ordinary shares' dividends converted into share capital | - | |
| Pension benefit difference | 7,944,921.60 | Note 2 |
| Transfer to the National Council for Social Security Fund of the PRC | - | |
| Distribution to holders of other equity instruments | - | |
| Others | 1,883,909.97 | |
| Unappropriated profit at the end of the year | 19,045,313,519.75 | |
| Item | Amount | Proportion of appropriation or allocation |
| 2022 (Restated) | ||
| Unappropriated profit at the beginning of the year before adjustment | 14,205,879,106.49 | |
| Add: Adjustment to unappropriated profit at beginning of the year | 21,052,360.17 | |
| Including: Changes in accounting policies | 21,052,360.17 | |
| Unappropriated profit at the beginning of the year after adjustment | 14,226,931,466.66 | |
| Add: Net profit of the year attributable to shareholders of the Company | 3,338,693,816.70 | |
| Unappropriated profit carried forward from other comprehensive income | 7,513,669.91 | |
| Less: Transfer to statutory surplus reserve in the current year | 40,734,887.15 | |
| Transfer to discretionary surplus reserve in the current year | - | |
| Ordinary shares' dividends payable | 826,617,003.32 | |
| Ordinary shares' dividends converted into share capital | - | |
| Pension benefit difference | 3,798,761.66 | |
| Distribution to holders of other equity instruments | ||
| Others | - | |
| Unappropriated profit at the end of the year | 16,701,988,301.14 | |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
47. Unappropriated profit - continued
Note 1: According to the resolution of shareholders' meeting on 22 May 2023, the Company
distributes cash dividends of RMB 4.50 (inclusive of tax) for every 10 shares, totallingRMB 1,124,583,597.45 on the basis of the total shares of 2,499,074,661 at the end of 2022.
Note 2: This represents the difference between the pension benefits under the original standard
and the retirement benefits of Shantou municipal police officers borne by Shantou Port.Shantou Port recognizes the related liabilities based on the actuarial results, andunappropriated profit of RMB 7,944,921.60 is eliminated based on the proportion ofequity interest in Shantou Port.
48. Operating income and operating costs
(1) Details of operating income and operating costs
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 2023 | 2022 | ||
| Income | Cost | Income | Cost | |
| Principal operation | 15,568,944,030.70 | 9,085,897,544.06 | 16,072,394,601.93 | 9,433,786,605.46 |
| Other operations | 181,531,749.52 | 232,289,163.69 | 158,094,525.62 | 216,675,107.48 |
| Total | 15,750,475,780.22 | 9,318,186,707.75 | 16,230,489,127.55 | 9,650,461,712.94 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
48. Operating income and operating costs - continued
(2) Breakdown information of operating income and operating costs
CHINA MERCHANTS PORT GROUP CO., LTD.Category of contracts
| Category of contracts | Ports operation | Bonded logistics operation | Other operations | Total | ||||
| Operating income | Operating costs | Operating income | Operating costs | Operating income | Operating costs | Operating income | Operating costs | |
| Mainland China, Hong Kong and Taiwan area | 10,284,643,568.10 | 6,714,915,284.62 | 492,433,288.31 | 254,604,583.47 | 181,531,749.52 | 232,289,163.69 | 10,958,608,605.93 | 7,201,809,031.78 |
| - Pearl River Delta | 6,075,691,801.01 | 3,640,281,453.34 | 343,594,001.79 | 181,329,868.92 | 181,531,749.52 | 232,289,163.69 | 6,600,817,552.32 | 4,053,900,485.95 |
| - Yangtze River Delta | 557,788,311.93 | 361,926,675.75 | - | - | - | - | 557,788,311.93 | 361,926,675.75 |
| - Bohai Rim | 76,760,801.96 | 63,825,074.56 | 148,839,286.52 | 73,274,714.55 | - | - | 225,600,088.48 | 137,099,789.11 |
| - Other areas | 3,574,402,653.20 | 2,648,882,080.97 | - | - | - | - | 3,574,402,653.20 | 2,648,882,080.97 |
| Other countries | 4,751,630,018.56 | 2,081,165,945.51 | 40,237,155.73 | 35,211,730.46 | - | - | 4,791,867,174.29 | 2,116,377,675.97 |
| Total | 15,036,273,586.66 | 8,796,081,230.13 | 532,670,444.04 | 289,816,313.93 | 181,531,749.52 | 232,289,163.69 | 15,750,475,780.22 | 9,318,186,707.75 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
48. Operating income and operating costs - continued
(3) Description of performance obligations
The Group provides port service, bonded logistics service and other services. These services areobligations performed over a period of time. For port services, as the handling time for containersand bulk cargos is short, the management believes that it is not necessary to recognize revenueaccording to the progress towards the completion of contract and it is an appropriate method torecognize the fulfilment of performance obligation and revenue upon the completion of the service.For bonded logistics service and other services, the customers evenly obtain and consume theeconomic benefits from the Group's performance of contract, meanwhile the charging rules asagreed in the contract terms usually adopt daily/month/yearly basis. During the process of renderingservices, the Group recognizes revenue using straight-line method. At the same time, the Group isprimarily responsible for the above services and generally does not have any commitment to theamount of money expected to be returned to the customer.
Part of the Group's handling contracts are established with discount terms, i.e., the customers whosebusiness volume reaches agreed level, are granted with preferential charge rate or discount. At theend of the year, as the business volume finally realized within the contract period is uncertain, thecontract consideration is subject to variable factors. The management includes this part of discountin other payables and provisions. At the end of the year, the variable considerations arising fromsales discount are set out in Note (VIII) 31 (3) and Note (VIII) 39.
(4) Descriptions on allocation to remaining performance obligations
At the end of the year, the amount of revenue corresponding to the performance obligations whichthe Group has entered into a contract for but has not fulfilled or completely fulfilled mainly includedthe contract liabilities of RMB 142,080,101.00, of which RMB 97,512,251.80 is expected to berecognized as revenue in 2024; and RMB 44,567,849.20 is expected to be recognized as revenue in2025 and subsequent years.
49. Taxes and surcharges
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 2023 | 2022 |
| Property tax | 75,912,651.85 | 63,233,633.53 |
| Land use tax | 37,809,190.33 | 36,260,260.97 |
| City construction and maintenance tax | 7,891,945.97 | 8,456,389.09 |
| Education surcharges and local education surcharges | 5,953,401.79 | 6,253,550.00 |
| Stamp duty | 5,057,465.35 | 8,694,943.46 |
| Others (Note) | 180,373,370.90 | 159,350,696.41 |
| Total | 312,998,026.19 | 282,249,473.46 |
Note: Others mainly represent the social contribution tax and tax on services borne by TCP, a
subsidiary of the Company, totalled BRL 120,997,445.84 (equivalent to RMB170,698,356.69) for the year.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
50. Administrative expenses
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 2023 | 2022 |
| Employee benefits | 1,297,690,387.03 | 1,280,394,043.79 |
| Depreciation expenses | 75,710,865.79 | 79,095,275.09 |
| Fees paid to agencies | 63,693,285.42 | 80,164,840.55 |
| Amortization of intangible assets | 56,233,463.25 | 54,493,578.78 |
| Others | 283,313,153.89 | 270,946,998.30 |
| Total | 1,776,641,155.38 | 1,765,094,736.51 |
51. Research and development expenses
| Item | 2023 | 2022 |
| Employee benefits | 163,593,250.77 | 218,783,071.72 |
| Direct materials and outsourced R&D | 41,115,107.10 | 47,737,604.22 |
| Depreciation and amortization | 11,500,358.17 | 15,813,613.68 |
| Others | 7,530,356.03 | 5,371,889.08 |
| Total | 223,739,072.07 | 287,706,178.70 |
52. Financial expenses
| Item | 2023 | 2022 |
| Interest expenses | 2,016,181,859.25 | 1,960,177,578.36 |
| Less: Interest income | 497,593,921.36 | 469,834,098.05 |
| Less: Capitalized interest expenses | 45,140,959.39 | 30,960,097.84 |
| Exchange differences | 85,519,920.28 | 477,004,284.27 |
| Interest expenses -Terminal management rights (Note) | 206,277,567.64 | 222,326,056.63 |
| Interest expenses on lease liabilities | 60,834,329.16 | 73,619,268.64 |
| Handling fee | 5,316,520.88 | 21,148,526.03 |
| Others | 7,718,011.68 | 5,232,154.38 |
| Total | 1,839,113,328.14 | 2,258,713,672.42 |
Note: Details are set out in Note (VIII) 37.
53. Other income
| Classification by nature | 2023 | 2022 |
| Business development subsidy | 113,983,657.91 | 94,355,004.33 |
| Transfer from allocation of deferred income (Note VIII 40) | 47,704,466.26 | 45,858,732.41 |
| Additional deduction of VAT | 25,604,125.36 | 45,179,805.12 |
| Special fund for operation | 18,439,586.22 | 7,385,898.57 |
| Steady post subsidies | 1,682,015.15 | 5,771,198.38 |
| Others | 16,975,409.87 | 43,097,431.61 |
| Total | 224,389,260.77 | 241,648,070.42 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
54. Investment income
(1) Details of investment income:
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 2023 | 2022 |
| Income from long-term equity investments under equity method | 5,979,007,585.96 | 7,185,182,148.75 |
| Including: Income from long-term equity investments of associates under equity method | 5,582,402,904.90 | 6,765,840,426.95 |
| Income from long-term equity investments of joint ventures under equity method | 396,604,681.06 | 419,341,721.80 |
| Investment income from disposal of subsidiaries | 216,949,902.47 | - |
| Income from disposal of long-term equity investments (Losses are marked with "-") | 77,647.56 | -20,508.06 |
| Investment income from held-for-trading financial assets | 91,219,728.19 | 152,728,622.47 |
| Investment income from other non-current financial assets | 41,365,576.62 | 39,525,241.71 |
| Dividend income from investments in other equity instruments | 20,056,500.00 | 240,001.46 |
| Total | 6,348,676,940.80 | 7,377,655,506.33 |
(2) Details of income from long-term equity investments under equity method
| Investee | 2023 | 2022 | Reason for changes |
| SIPG | 3,700,844,097.27 | 4,762,565,562.93 | Changes in net profit of investee |
| Ningbo Zhoushan | 1,049,986,813.85 | 351,607,511.90 | Changes in net profit of investee |
| Terminal Link SAS | 221,059,137.39 | 364,965,366.44 | Changes in net profit of investee |
| Nanshan Group | 214,805,574.66 | 206,680,217.04 | Changes in net profit of investee |
| Euro-Asia Oceangate S.àr.l. | 186,208,262.73 | 140,072,915.26 | Changes in net profit of investee |
| Liaoning Port | 151,571,456.52 | 144,196,061.13 | Changes in net profit of investee |
| Shenzhen China Merchants Qianhai Industrial Development Co., Ltd. | 42,538,797.17 | 218,696,415.40 | Changes in net profit of investee |
| Others | 411,993,446.37 | 996,398,098.65 | Changes in net profit of investee |
| Total | 5,979,007,585.96 | 7,185,182,148.75 |
55. Gains (Losses) from changes in fair value
| Source resulting in gains from changes in fair values (Losses are marked with "-") | 2023 | 2022 |
| Held-for-trading financial assets | 49,197,662.35 | 34,417,357.38 |
| Other non-current financial assets | 24,155,138.17 | -163,451,007.49 |
| Including: Financial assets at fair value through profit or loss | 24,155,138.17 | -163,451,007.49 |
| Total | 73,352,800.52 | -129,033,650.11 |
56. Gains (Losses) from impairment of credit
| Item | 2023 | 2022 |
| I. Losses from impairment of credit of accounts receivable | -9,285,389.19 | -5,939,952.37 |
| II. Gains (Losses) from impairment of credit of other receivables (Losses are marked with "-") | 43,872,200.88 | -217,234,842.93 |
| III. Gains (Losses) from impairment of credit of long-term receivables (Losses are marked with "-") | 2,697,229.49 | -298,781.25 |
| Total | 37,284,041.18 | -223,473,576.55 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
57. Losses from impairment of assets
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 2023 | 2022 |
| Losses from impairment of fixed assets | -149,923,619.44 | -6,048,776.05 |
| Losses from impairment of intangible assets | -41,473,147.97 | -15,537,122.10 |
| Gains (Losses) from decline in value of inventories (Losses are marked with "-") | 99,456.13 | -573,122.05 |
| Total | -191,297,311.28 | -22,159,020.20 |
58. Gains from disposal of assets
| Item | 2023 | 2022 | Amount included in non-recurring profit or loss for the current year |
| Gains from disposal of non-current assets | 36,759,532.61 | 55,130,095.52 | 36,759,532.61 |
| Including: Gains from disposal of intangible assets | 35,051,791.80 | 57,590,483.04 | 35,051,791.80 |
| Gains (Losses) from disposal of fixed assets (Losses are marked with "-") | 1,713,921.04 | -1,824,719.58 | 1,713,921.04 |
| Other losses | -6,180.23 | -635,667.94 | -6,180.23 |
59. Non-operating income
| Item | 2023 | 2022 | Amount included in non-recurring profit or loss for the current year |
| Compensation received for violation of contracts | 55,396,338.32 | 2,930,876.85 | 55,396,338.32 |
| Management service fee and directors' remuneration | 11,964,440.07 | 8,190,857.40 | 11,964,440.07 |
| Land rent deduction | 7,124,609.25 | 6,421,113.49 | 7,124,609.25 |
| Income from relocation compensation | 5,558,730.17 | 6,955,000.00 | 5,558,730.17 |
| Gains from retirement or damage of non-current assets | 1,966,904.66 | 3,138,573.24 | 1,966,904.66 |
| Including: Gains from retirement or damage of fixed assets | 1,765,984.40 | 3,138,573.24 | 1,765,984.40 |
| Exempted current accounts | 197,118.09 | 25,091,421.77 | 197,118.09 |
| Insurance claims | 44,269.64 | 341,555.58 | 44,269.64 |
| Operation compensation (Note) | - | 213,574,591.16 | - |
| Government grants | - | 1,640,553.77 | - |
| Others | 5,049,613.92 | 10,989,909.51 | 5,049,613.92 |
| Total | 87,302,024.12 | 279,274,452.77 | 87,302,024.12 |
Note: Refer to Note (VIII), 7.3 (2) for details.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
60. Non-operating expenses
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 2023 | 2022 | Amount included in non-recurring profit or loss for the current year |
| Litigation loss | 42,689,603.93 | 20,603,558.61 | 42,689,603.93 |
| Losses on retirement of non-current assets | 24,548,001.45 | 162,620,964.79 | 24,548,001.45 |
| Including: Losses on retirement or damage of fixed assets | 22,356,701.04 | 34,444,521.73 | 22,356,701.04 |
| Expenditure on public welfare donations | 11,153,329.51 | 21,352,071.53 | 11,153,329.51 |
| Compensation and liquidated damages | 1,195,947.89 | 11,552,735.44 | 1,195,947.89 |
| Administrative fines and late fees | 624,038.01 | - | 624,038.01 |
| Others | 16,861,919.93 | 4,312,924.31 | 16,861,919.93 |
| Total | 97,072,840.72 | 220,442,254.68 | 97,072,840.72 |
61. Borrowing costs
| Item | Capitalization rate | Amount capitalized |
| Construction in progress | — — | — — |
| Phase I project for the stuffing and destuffing service area of Baoman Port Area, Zhanjiang Port | 3.50% | 10,355,373.62 |
| Phase II project for the operation area terminal at Liaogeshan Port Area, Foshan Port | 4.19% | 10,134,790.48 |
| Installation project of bucket-wheel stacker reclaimer, Zhanjiang Port | 3.50% | 837,359.25 |
| Phase I expansion project for the container terminal at Baoman Port Area, Zhanjiang Port | 3.30% | 57,750.00 |
| Other non-current assets | — — | — — |
| Advances for channels | 3.50% | 23,755,686.04 |
| Sub-total | — — | 45,140,959.39 |
| Interest expenses included in profit or loss for the period (Excludes interest expense on terminal operating rights and lease liabilities） | — — | 1,971,040,899.86 |
| Total | — — | 2,016,181,859.25 |
62. Translation of foreign currencies
| Item | 2023 |
| Exchange differences included in profit or loss for the period | 85,519,920.28 |
| Total | 85,519,920.28 |
63. Income tax expenses
| Item | 2023 | 2022 |
| Current income tax expenses | 1,129,424,872.77 | 871,429,455.95 |
| Deferred income tax expenses | 174,154,980.16 | 241,530,220.80 |
| Total | 1,303,579,852.93 | 1,112,959,676.75 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
63. Income tax expenses - continued
Reconciliation of income tax expenses to the accounting profit is as follows:
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 2023 |
| Total profit | 8,799,191,938.69 |
| Income tax expenses calculated at 25% | 2,199,797,984.67 |
| Effect of non-deductible costs, expenses and losses | 272,242,876.02 |
| Accrued income tax | 384,531,164.82 |
| Effect of deductible temporary differences and deductible losses for which deferred tax assets are not recognized in the year | 232,164,986.26 |
| Effect of tax-free income (Note) | -1,152,685,934.75 |
| Effect of tax incentives and changes in tax rate | -461,574,423.95 |
| Effect of different tax rates of subsidiaries operating in other jurisdictions | -191,471,358.38 |
| Effect of utilizing deductible losses for which deferred tax assets were not recognized in prior period | -47,180,168.14 |
| Effect of adjustments to income tax of prior year | -19,545,836.05 |
| Others | 87,300,562.43 |
| Income tax expenses | 1,303,579,852.93 |
Note: This mainly represents the tax effect of income from investments in joint ventures and
associates.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
64. Assets with restricted ownership and use right
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 31/12/2023 | 31/12/2022 | ||||||
| Gross carrying amount | Carrying amount | Type of restriction | Status of restriction | Gross carrying amount | Carrying amount | Type of restriction | Status of restriction | |
| Cash and bank balances (Note 1) | 46,535,456.14 | 46,535,456.14 | Restricted guarantee | Performance bonds, frozen funds, etc. | 9,309,145.94 | 9,309,145.94 | Restricted guarantees | Performance bonds, frozen funds for card business of Bank of Communications |
| Equity investment in CICT (Note 2) | - | - | — — | — — | 2,115,796,097.99 | 2,115,796,097.99 | Pledge | Pledge of equity |
| Equity investment in TML (Note 2) | - | - | — — | — — | 1,047,063,416.30 | 1,047,063,416.30 | Pledge | Pledge of equity |
| Fixed assets (Note 3) | 330,222,332.58 | 291,001,239.59 | Mortgage | Mortgage borrowings | 341,870,382.84 | 341,870,382.84 | Mortgage | Mortgage borrowings |
| Intangible assets (Note 3) | 457,654,685.65 | 457,654,685.65 | Mortgage | Mortgage borrowings | 222,040,259.68 | 222,040,259.68 | Mortgage | Mortgage borrowings |
| Construction in progress (Note 3) | - | - | — — | — — | 4,298,598.50 | 4,298,598.50 | Restricted construction in progress | Mortgage borrowings |
| Total | 834,412,474.37 | 795,191,381.38 | — — | — — | 3,740,377,901.25 | 3,740,377,901.25 | — — | — — |
Note 1: Details of restricted cash and bank balances are set out in Note (VIII) 1.
Note 2: Details of pledged equity are set out in Note (VIII) 34.
Note 3: Details of mortgage borrowings are set out in Note (VIII) 24 and Note (VIII) 34.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
65. Provision for impairment of assets and provision for credit loss
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 31/12/2022 | Effect of changes in the scope of consolidation | Provision for the year | Reversal for the year | Write-off and charge-off for the year | Transfer-out due to sale in the current year | Other increases for the year | Other decreases for the year | Effect of translation of financial statements denominated in foreign currencies | 31/12/2023 |
| Provision for credit loss of accounts receivable | 94,013,267.44 | -5,662,552.89 | 20,976,076.79 | -11,690,687.60 | - 8,087,700.00 | - | - | - | 1,473,959.35 | 91,022,363.09 |
| Provision for credit loss of other receivables | 1,003,685,597.76 | -581,674.48 | 3,495,816.21 | -47,368,017.09 | -73,074.00 | - | - | - | -2,076,917.54 | 957,081,730.86 |
| Provision for decline in value of inventories | 1,326,130.64 | - | - | -99,456.13 | - | - | - | - | 7,953.87 | 1,234,628.38 |
| Provision for credit loss of long-term receivables | 3,875,396.19 | - | 921,438.82 | -3,618,668.31 | - | - | - | - | - | 1,178,166.70 |
| Provision for impairment of long-term equity investments | 357,168,270.27 | - | - | - | - | - | - | - | 5,165,805.49 | 362,334,075.76 |
| Provision for impairment of fixed assets | 63,574,868.76 | - | 149,923,619.44 | - | - | - | - | - | 5,994.88 | 213,504,483.08 |
| Provision for impairment of intangible assets | 15,537,122.10 | - | 41,473,147.97 | - | - | - | - | - | - | 57,010,270.07 |
| Provision for impairment of goodwill | 970,663,044.33 | - | - | - | - | - | - | - | - | 970,663,044.33 |
| Total | 2,509,843,697.49 | -6,244,227.37 | 216,790,099.23 | -62,776,829.13 | -8,160,774.00 | - | - | - | 4,576,796.05 | 2,654,028,762.27 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
66. Other comprehensive income, net of tax
Details are set out in Note (VIII) 44.
67. Items in cash flow statement
(1) Cash relating to operating activities
Other cash receipts relating to operating activities
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 2023 | 2022 |
| Interest income | 316,807,536.02 | 258,843,106.76 |
| Government grants | 163,169,407.30 | 146,183,117.33 |
| Guarantees and deposits | 59,967,562.07 | 56,548,699.29 |
| Insurance indemnities | 11,868,450.00 | 58,668,674.41 |
| Rentals | 11,677,109.86 | 6,633,711.38 |
| Others | 364,073,953.84 | 614,917,616.16 |
| Total | 927,564,019.09 | 1,141,794,925.33 |
Other cash payments relating to operating activities
| Item | 2023 | 2022 |
| Advance payment | 191,928,420.03 | 328,830,785.30 |
| Operating expenses such as operating costs and administrative expenses etc. | 167,200,604.70 | 136,317,839.62 |
| Guarantees and deposits | 59,616,680.63 | 47,134,870.60 |
| Rentals | 26,007,218.14 | 22,559,158.93 |
| Harbor dues on cargo | 7,279,452.46 | 14,619,372.24 |
| Port charges | 5,743,216.19 | 5,422,920.14 |
| Others | 395,451,467.06 | 471,440,206.57 |
| Total | 853,227,059.21 | 1,026,325,153.40 |
(2) Cash relating to investing activities
Cash receipts relating to significant investing activities
| Item | 2023 | 2022 |
| Recovered structured deposits | 28,397,000,000.00 | 40,874,000,000.00 |
| Recovered lending(Note 1) | 2,965,681,743.10 | - |
| Dividends received | 2,186,696,975.69 | 2,239,605,794.55 |
| Funds for disposal of subsidiaries received (Note 2) | 1,683,385,533.43 | - |
| Total | 35,232,764,252.22 | 43,113,605,794.55 |
Note 1: It represents the recovery of RMB 2,965,681,743.10 lent to Terminal Link SAS.
Note 2: The funds received for disposal of subsidiaries during the year represent the amount
received for disposal of Ningbo Daxie.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
67. Items in cash flow statement - continued
(2) Cash relating to investing activities - continued
Cash payments relating to significant investing activities
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 2023 | 2022 |
| Purchase of structured deposits | 29,967,000,000.00 | 36,954,000,000.00 |
| Investment funds | - | 17,549,460,113.25 |
| Total | 29,967,000,000.00 | 54,503,460,113.25 |
Other cash receipts relating to investing activities
| Item | 2023 | 2022 |
| Recovered lending by Terminal Link SAS | 2,965,681,743.10 | - |
| Interest on advances for the project | 177,940,904.60 | 169,844,015.81 |
| Net cash receipts from acquisition of subsidiaries and other business units | - | 74,295,900.85 |
| Recovered principal for the advances of the project | - | 45,535,614.18 |
| Others | 21,332,655.57 | 5,388,978.50 |
| Total | 3,164,955,303.27 | 295,064,509.34 |
Other cash payments relating to investing activities
| Item | 2023 | 2022 |
| Performance guarantees for project development | 39,087,797.69 | - |
| Disposal of equity of subsidiaries | 35,267,442.35 | - |
| Payment of taxes on land acquisition and reserve by An Tong Jie Terminal Warehouse Service (Shenzhen) Co., Ltd. ("ATJ") | - | 947,426,040.54 |
| Others | 8,308,063.29 | 7,376,441.76 |
| Total | 82,663,303.33 | 954,802,482.30 |
(3) Cash relating to financing activities
Other cash receipts relating to financing activities
| Item | 2023 | 2022 |
| Sale and leaseback proceeds | 328,026,212.50 | 50,000,000.00 |
| Others | 6,728,017.13 | 6,303,169.80 |
| Total | 334,754,229.63 | 56,303,169.80 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
67. Items in cash flow statement - continued
(3) Cash relating to financing activities - continued
Other cash payments relating to financing activities
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 2023 | 2022 |
| Repayment of perpetual bonds | 4,222,148,460.84 | - |
| Payment for the Company's acquisition of minority interests of CM Port | 872,848,916.41 | 660,552,076.54 |
| Lease expenses paid | 829,455,300.35 | 422,373,905.31 |
| Payment for the Company's acquisition of minority interests of Oasis King International Limited | 818,659,106.04 | - |
| Payment for the Company's acquisition of minority interests of CM International Tech | 109,901,500.00 | - |
| Payment for non-public shares issued by the Company | - | 7,778,570.52 |
| Others | 14,080,546.68 | 33,412,187.98 |
| Total | 6,867,093,830.32 | 1,124,116,740.35 |
Changes in liabilities arising from financing activities
| Item | 31/12/2022 | Increase for the year | Decrease for the year | 31/12/2023 | ||
| Cash changes | Non-cash changes | Cash changes | Non-cash changes | |||
| Short-term borrowings | 7,164,338,366.18 | 18,324,960,509.40 | 531,121,750.39 | 10,306,375,337.00 | - | 15,714,045,288.97 |
| Long-term borrowings | 12,390,099,177.85 | 11,091,911,738.15 | - | 4,325,439,446.26 | 929,027,515.03 | 18,227,543,954.71 |
| Non-current liabilities due within one year | 11,641,223,688.95 | - | 7,930,642,448.33 | 12,695,530,031.31 | 58,931,816.72 | 6,817,404,289.25 |
| Bonds payable | 19,088,293,099.02 | - | 199,215,465.13 | - | 5,000,000,000.00 | 14,287,508,564.15 |
| Lease liabilities | 948,350,914.04 | - | 404,265,256.81 | 114,686,862.61 | 236,757,101.32 | 1,001,172,206.92 |
| Dividends payable | 92,374,921.29 | - | 2,924,344,643.64 | 2,880,173,694.97 | 24,648,655.69 | 111,897,214.27 |
| Other current liabilities | 3,017,713,424.64 | 6,328,026,212.50 | 77,180,966.07 | 7,415,730,466.23 | - | 2,007,190,136.98 |
| Total | 54,342,393,591.97 | 35,744,898,460.05 | 12,066,770,530.37 | 37,737,935,838.38 | 6,249,365,088.76 | 58,166,761,655.25 |
(4) The Company has no cash flows presented on a net basis
(5) Significant activities that do not involve cash receipts and payment for the current period
but have an impact on the enterprise's financial position or may affect the enterprise's cashflows in the future and their financial effects:
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
68. Supplementary information to the cash flow statement
(1) Supplementary information to the cash flow statement
CHINA MERCHANTS PORT GROUP CO., LTD.
Supplementary information
| Supplementary information | 2023 | 2022 (Restated) |
| 1. Reconciliation of net profit to cash flows from operating activities: | — — | — — |
| Net profit | 7,495,612,085.76 | 8,231,903,300.27 |
| Add: Provision for impairment of assets | 191,297,311.28 | 22,159,020.20 |
| Provision for impairment of credit | -37,284,041.18 | 223,473,576.55 |
| Depreciation of fixed assets | 1,983,548,731.36 | 2,015,080,231.04 |
| Depreciation of investment properties | 182,833,076.22 | 184,276,397.36 |
| Depreciation of right-of-use assets | 357,502,960.45 | 349,846,619.98 |
| Amortization of intangible assets | 686,879,674.72 | 663,429,174.32 |
| Amortization of long-term prepaid expenses | 92,971,461.67 | 84,874,394.19 |
| Losses (Gains) from disposal of fixed assets, intangible assets and other long-term assets (Losses are marked with "-") | -36,759,532.61 | -55,130,095.52 |
| Losses on retirement of fixed assets, intangible assets and other long-term assets | 22,581,096.79 | 159,482,391.55 |
| Losses (Gains) from changes in fair value (Losses are marked with "-") | -73,352,800.52 | 129,033,650.11 |
| Financial expenses | 2,185,350,735.70 | 2,532,320,466.47 |
| Investment loss (income) (Losses are marked with "-") | -6,348,676,940.80 | -7,377,655,506.33 |
| Decrease in deferred tax assets | 19,435,343.92 | 20,145,903.44 |
| Increase in deferred tax liabilities | 154,719,636.24 | 221,384,317.36 |
| Decrease (Increase) in inventories (Losses are marked with "-") | 6,316,130.87 | -30,798,761.65 |
| Decrease (Increase) in operating receivables (Losses are marked with "-") | -132,511,582.62 | -245,987,914.80 |
| Increase (Decrease) in operating payables (Losses are marked with "-") | -170,856,712.08 | -207,459,774.19 |
| Net cash flows from operating activities | 6,579,606,635.17 | 6,920,377,390.35 |
| 2. Significant investing and financing activities that do not involve cash receipts and payments: | — — | — — |
| Conversion of debt into capital | - | - |
| Convertible bonds due within one year | - | - |
| 3. Net changes in cash and cash equivalents: | — — | |
| Closing balance of cash | 16,018,613,631.10 | 13,567,309,471.62 |
| Less: Opening balance of cash | 13,567,309,471.62 | 12,727,355,238.36 |
| Add: Closing balance of cash equivalents | - | - |
| Less: Opening balance of cash equivalents | - | - |
| Net increase in cash and cash equivalents | 2,451,304,159.48 | 839,954,233.26 |
(2) Cash and cash equivalents
| Item | 31/12/2023 | 31/12/2022 |
| I. Cash | 16,018,613,631.10 | 13,567,309,471.62 |
| Including: Cash on hand | 974,692.93 | 726,960.10 |
| Bank deposits available for payment at any time | 16,009,954,475.85 | 13,045,336,190.09 |
| Other monetary funds available for payment at any time | 7,684,462.32 | 521,246,321.43 |
| II. Cash equivalents | - | - |
| III. Balance of cash and cash equivalents at the end of the year | 16,018,613,631.10 | 13,567,309,471.62 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 141 -
(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
68. Supplementary information to the cash flow statement - continued
(3) Net cash receipts from disposal of subsidiaries
CHINA MERCHANTS PORT GROUP CO., LTD.
| Amount | |
| Cash or cash equivalents received in the current year from disposal of subsidiaries in the current year | 1,797,936,550.00 |
| Including: Ningbo Daxie | 1,714,909,050.00 |
| Dalian Port Logistics Network Co., Ltd. | 63,716,000.00 |
| Yingkou Gangxin Technology Co., Ltd. | 19,311,500.00 |
| Less: Cash and cash equivalents held by subsidiaries on the date when control is lost | 149,818,458.92 |
| Including: Ningbo Daxie | 31,523,516.57 |
| Dalian Port Logistics Network Co., Ltd. | 86,068,813.26 |
| Yingkou Gangxin Technology Co., Ltd. | 32,226,129.09 |
| Add: Cash or cash equivalents received in the current year from disposal of subsidiaries in prior periods | - |
| Including: Ningbo Daxie | - |
| Dalian Port Logistics Network Co., Ltd. | - |
| Yingkou Gangxin Technology Co., Ltd. | - |
| Net cash receipts from disposal of subsidiaries | 1,648,118,091.08 |
(4) The Company has no items with restricted use but are still presented as cash and cash
equivalents.
(5) Cash and bank balances not classified as cash and cash equivalents
| Items | 2023 | 2022 | Reason |
| Restricted guarantees | 44,697,370.16 | 9,297,145.94 | Restricted scope of use |
| Interest receivable from bank deposits | 14,497,091.00 | 16,126,969.60 | Not actually received |
| Funds frozen for litigation | 1,826,085.98 | - | Not available for withdrawal at any time |
| Guarantees frozen for ETC | 12,000.00 | 12,000.00 | Not available for withdrawal at any time |
| Interest on time deposit | - | 23,183,152.24 | Not actually received |
| Total | 61,032,547.14 | 48,619,267.78 | / |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 142 -
(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
69. Foreign currency monetary items
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Closing balance in foreign currency | Exchange rate | Closing balance in RMB |
| Cash and bank balances | 2,988,104,992.31 | ||
| Including: HKD | 19,647,056.77 | 0.9062 | 17,804,555.79 |
| USD | 317,185,988.33 | 7.0827 | 2,246,533,199.54 |
| RMB | 408,295,641.99 | 1.0000 | 408,295,641.99 |
| EUR | 40,140,420.78 | 7.8592 | 315,471,594.99 |
| Accounts receivable | 173,075,521.17 | ||
| Including: HKD | 512,979.31 | 0.9062 | 464,872.11 |
| USD | 1,423,085.41 | 7.0827 | 10,079,287.03 |
| EUR | 20,680,395.21 | 7.8592 | 162,531,362.03 |
| Other receivables | 799,457,535.30 | ||
| Including: HKD | 524,271,214.69 | 0.9062 | 475,105,060.18 |
| USD | 1,343,324.84 | 7.0827 | 9,514,366.84 |
| EUR | 9,691,705.64 | 7.8592 | 76,169,052.97 |
| RMB | 238,669,055.31 | 1.0000 | 238,669,055.31 |
| Long-term receivables | 282,209,825.00 | ||
| Including: EUR | 25,995,028.12 | 7.8592 | 204,300,125.00 |
| Short-term borrowings | 6,885,485,000.00 | ||
| USD | 550,000,000.00 | 7.0827 | 3,895,485,000.00 |
| RMB | 2,990,000,000.00 | 1.0000 | 2,990,000,000.00 |
| Accounts payable | 40,104,170.70 | ||
| Including: HKD | 1,173,832.48 | 0.9062 | 1,063,750.47 |
| USD | 44,617.49 | 7.0827 | 316,012.30 |
| EUR | 4,927,270.96 | 7.8592 | 38,724,407.93 |
| Other payables | 668,048,202.56 | ||
| Including: HKD | 32,251,917.27 | 0.9062 | 29,227,332.47 |
| USD | 39,743,432.26 | 7.0827 | 281,490,807.67 |
| EUR | 13,924,592.03 | 7.8592 | 109,436,153.68 |
| RMB | 247,893,908.74 | 1.0000 | 247,893,908.74 |
| Non-current liabilities due within one year | 175,706,225.87 | ||
| Including: USD | 23,489,155.23 | 7.0827 | 166,366,639.76 |
| RMB | 9,339,586.11 | 1.0000 | 9,339,586.11 |
| Long-term borrowings | 4,656,000,000.00 | ||
| Including: RMB | 4,656,000,000.00 | 1.0000 | 4,656,000,000.00 |
| Bonds payable | 11,287,508,564.15 | ||
| Including: USD | 1,593,673,113.95 | 7.0827 | 11,287,508,564.15 |
| Long-term payables | 9,391,615.50 | ||
| Including: HKD | 2,366,680.97 | 0.9062 | 2,144,733.63 |
| USD | 1,023,180.69 | 7.0827 | 7,246,881.87 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 143 -
(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
70. Leases
(1) Lessor under operating lease
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | Amount |
| I. Revenue | — — |
| Lease income | 288,005,772.42 |
| Including: Income related to variable lease payments that are not included in lease receipts | - |
| II. Undiscounted lease receipts received after the balance sheet date | — — |
| 1st year | 206,915,451.16 |
| 2nd year | 144,032,701.64 |
| 3rd year | 118,298,471.55 |
| 4th year | 83,869,818.08 |
| 5th year | 45,923,854.38 |
| Over 5 years | 121,551,555.20 |
Note: The operating leases where the Group acts as the lessor are related to port and terminal
facilities, machinery and equipment, vehicles, land and buildings, with lease terms rangingfrom 1 month to 50 years and option to renew the lease of port and terminal facilities,machinery and equipment, land and buildings. The Group considers that the unguaranteedbalance of leased assets does not constitute significant risk of the Group, as the assets areproperly used.
(2) Lessee
| Item | Amount |
| Interest expenses on lease liabilities | 60,834,329.16 |
| Short-term lease expenses that are accounted for using simplified approach and included in cost of related assets or profit or loss for the period | 55,635,496.52 |
| Expenses on leases of low-value assets (exclusive of expenses on short-term leases of low-value assets) that are accounted for using simplified approach and included in cost of related assets or profit or loss for the period | 2,564,521.41 |
| Variable lease payments that are included in cost of related assets or profit or loss but not included in measurement of lease liabilities | - |
| Including: The portion arising from sale and leaseback transactions | - |
| Income from sub-lease of right-of-use assets | 11,364,199.51 |
| Total cash outflows relating to leases | 837,856,182.83 |
| Income (loss) from sale and leaseback transactions | 61,743,409.02 |
| Cash inflows from sale and leaseback transactions | 328,026,212.50 |
| Cash outflows from sale and leaseback transactions | 520,496,584.08 |
| Others | - |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 144 -
(VIII) NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
70. Leases - continued
(2) Lessee - continued
Sale and leaseback transactions and basis for determination:
Note: For the purpose of raising funds and leasing back for use, the Company carries out sale and
leaseback transaction with the legally owned terminal assets as the subject of the transferand the leased assets, for a term of three years. As the Company is entitled to repurchase atthe expiry of the lease term and the repurchase price is not lower than the original sellingprice, it is considered as a financing transaction and is recognized as a long-term payablewhen the amount is received from the lessor, and the difference between the original sellingprice and the repurchase price is recognized as interest expenses.
(IX) R&D EXPENDITURE
1. Disclosure by nature of expenses
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 2023 | 2022 |
| Employee benefits | 166,273,348.83 | 222,334,684.01 |
| Direct materials and outsourced R&D | 78,769,899.84 | 57,140,031.23 |
| Depreciation and amortisation | 11,654,856.90 | 16,295,546.56 |
| Others | 15,963,664.54 | 23,694,839.98 |
| Total | 272,661,770.11 | 319,465,101.78 |
| Including: R&D expenditure recorded as expenses | 223,739,072.07 | 287,706,178.70 |
| R&D expenditure capitalised | 48,922,698.04 | 31,758,923.08 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 145 -
(IX) R&D EXPENDITURE - continued
2. Development expenditure for R&D projects that qualify for capitalisation
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 31/12/2022 | Increase | Decrease | 31/12/2023 | ||
| Internal development expenditure | Recognised as fixed assets | Recognised as intangible assets | Transferred to profit or loss for the period | |||
| Eport | - | 30,150,532.71 | - | - | - | 30,150,532.71 |
| Other R&D projects | 17,412,196.16 | 19,364,847.34 | 15,065,485.70 | 279,255.32 | 592,682.01 | 20,839,620.47 |
| Total | 17,412,196.16 | 49,515,380.05 | 15,065,485.70 | 279,255.32 | 592,682.01 | 50,990,153.18 |
(X) CHANGES IN SCOPE OF CONSOLIDATION
1. Disposal of subsidiaries
Loss of control over subsidiaries
| Name of the subsidiary | Point in time of losing control | Disposal consideration at point in time of losing control | Disposal proportion at point in time of losing control (%) | Disposal approach at point in time of losing control | Determination basis for point in time of losing control | Difference between disposal consideration and shares of corresponding net assets of the subsidiary at consolidated level | Proportion of remaining equity at the date of losing control (%) | Amount of other comprehensive income related to equity investments of the original subsidiary transferred to investment gains or losses or retained earnings |
Ningbo Daxie
| Ningbo Daxie | August 2023 | 1,845,000,000.00 | 45.00 | Transfer of equity | Completion of transaction and transfer of control | 205,336,602.02 | - | - |
Dalian Port Logistics NetworkCo., Ltd.
| Dalian Port Logistics Network Co., Ltd. | November 2023 | 63,716,000.00 | 79.03 | Transfer of equity | Completion of transaction and transfer of control | 19,694,127.20 | - | - |
| Gangxin Technology | November 2023 | 19,311,500.00 | 100.00 | Transfer of equity | Completion of transaction and transfer of control | -8,080,826.75 | - | - |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 146 -
(XI) EQUITY IN OTHER ENTITIES
1. Interests in subsidiaries
(1) Composition of the Group - Major subsidiaries
CHINA MERCHANTS PORT GROUP CO., LTD.
Name of the subsidiary
| Name of the subsidiary | Principal place of business | Place of incorporation | Nature of business | Registered capital (RMB'0000, unless otherwise specified) | Shareholding ratio of the Company (%) | Acquisition method | |
| Direct | Indirect | ||||||
| Shenzhen Chiwan International Freight Agency Co., Ltd. | Shenzhen China | Shenzhen China | Logistics support services | 550.00 | 100.00 | - | Established through investment |
| Chiwan Wharf Holdings (Hong Kong) Ltd. (Wharf Holdings Hong Kong) | HK China | HK China | Investment holding | HKD 1,000,000 | 100.00 | - | Established through investment |
| Dongguan Shenchiwan Port Affairs Co., Ltd. | Dongguan China | Dongguan China | Logistics support services | 45,000.00 | 85.00 | - | Established through investment |
| Dongguan Shenchiwan Wharf Co., Ltd. | Dongguan China | Dongguan China | Logistics support services | 40,000.00 | 100.00 | - | Established through investment |
| Shenzhen Chiwan Harbor Container Co. Ltd. | Shenzhen China | Shenzhen China | Logistics support services | 28,820.00 | 100.00 | - | Business combination involving enterprises under common control |
| Shenzhen Chiwan Port Development Co., Ltd. | Shenzhen China | Shenzhen China | Logistics support services | 10,000.00 | 100.00 | - | Business combination involving enterprises under common control |
| Chiwan Container Terminal Co., Ltd. | Shenzhen China | Shenzhen China | Logistics support services | USD 95,300,000 | 55.00 | 20.00 | Business combination involving enterprises under common control |
| Shenzhen Chiwan Tugboat Co., Ltd. | Shenzhen China | Shenzhen China | Logistics support services | 2,400.00 | 100.00 | - | Business combination involving enterprises under common control |
| Chiwan Shipping (Hong Kong) Limited | HK China | HK China | Logistics support services | HKD 800,000 | 100.00 | - | Business combination involving enterprises under common control |
| CM Port (Note 1) | HK China | HK China | Investment holding | HKD 48,730,938,800 | 0.38 | 48.90 | Business combination involving enterprises under common control |
| China Merchants Bonded Logistics Co., Ltd. | Shenzhen China | Shenzhen China | Logistics support services | 70,000.00 | 40.00 | 60.00 | Business combination involving enterprises under common control |
| CM International Tech | Shenzhen China | Shenzhen China | IT service | 8,784.82 | 56.26 | 43.74 | Business combination involving enterprises under common control |
| China Merchants International (China) Investment Co., Ltd. | Shenzhen China | Shenzhen China | Investment holding | USD67,400,000 | - | 100.00 | Business combination involving enterprises under common control |
| China Merchants International Container Terminal (Qingdao) Co., Ltd. | Qingdao China | Qingdao China | Logistics support services | USD 206,300,000 | - | 100.00 | Business combination involving enterprises under common control |
| China Merchants Container Services Limited | HK China | HK China | Logistics support services | HKD 500,000 | - | 100.00 | Business combination involving enterprises under common control |
| China Merchants Port (Shenzhen) Co., Ltd. | Shenzhen China | Shenzhen China | Logistics support services | 55,000.00 | - | 100.00 | Business combination involving enterprises under common control |
| Shenzhen Haiqin Project Management Co., Ltd. | Shenzhen China | Shenzhen China | Engineering supervision service | 1,000.00 | - | 100.00 | Business combination involving enterprises under common control |
| ATJ | Shenzhen China | Shenzhen China | Preparation for the warehousing project | HKD 100,000,000 | - | 100.00 | Business combination involving enterprises under common control |
| ASJ | Shenzhen China | Shenzhen China | Preparation for the warehousing project | HKD 100,000,000 | - | 100.00 | Business combination involving enterprises under common control |
| China Merchants International Terminal (Qingdao) Co., Ltd. | Qingdao China | Qingdao China | Logistics support services | USD 44,000,000 | - | 90.10 | Business combination involving enterprises under common control |
| CICT | Sri Lanka | Sri Lanka | Logistics support services | USD 150,000,100 | - | 85.00 | Business combination involving enterprises under common control |
| Magang Godown & Wharf | Shenzhen China | Shenzhen China | Logistics support services | 33,500.00 | - | 100.00 | Business combination involving enterprises under common control |
| Shenzhen Mawan Port Services Co., Ltd. | Shenzhen China | Shenzhen China | Logistics support services | 20,000.00 | - | 100.00 | Business combination involving enterprises under common control |
| Zhangzhou China Merchants Tugboat Co., Ltd. | Zhangzhou China | Zhangzhou China | Logistics support services | 1,500.00 | - | 100.00 | Business combination involving enterprises under common control |
| Zhangzhou China Merchants Port Co., Ltd. | Zhangzhou China | Zhangzhou China | Logistics support services | 116,700.00 | - | 60.00 | Business combination involving enterprises under common control |
| Zhangzhou Investment Promotion Bureau Xiamenwan Port Affairs Co., Ltd. ("Xiamenwan Port Affairs") (Note 2) | Zhangzhou China | Zhangzhou China | Logistics support services | 44,450.00 | - | 31.00 | Business combination involving enterprises under common control |
| Shekou Container Terminals Ltd. | Shenzhen China | Shenzhen China | Logistics support services | HKD 618,201,200 | - | 100.00 | Business combination involving enterprises under common control |
| Shenzhen Lianyunjie Container Terminals Co., Ltd. | Shenzhen China | Shenzhen China | Logistics support services | 60,854.90 | - | 100.00 | Business combination involving enterprises under common control |
| Anxunjie Container Terminals (Shenzhen) Co., Ltd. | Shenzhen China | Shenzhen China | Logistics support services | 127,600.00 | - | 100.00 | Business combination involving enterprises under common control |
| Anyunjie Port Warehousing Service (Shenzhen) Co., Ltd. | Shenzhen China | Shenzhen China | Preparation for the warehousing project | 6,060.00 | - | 100.00 | Business combination involving enterprises under common control |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 147 -
(XI) EQUITY IN OTHER ENTITIES - continued
1. Interests in subsidiaries - continued
(1) Composition of the Group - Major subsidiaries - continued
CHINA MERCHANTS PORT GROUP CO., LTD.
Name of the subsidiary
| Name of the subsidiary | Principal place of business | Place of incorporation | Nature of business | Registered capital (RMB'0000, unless otherwise specified) | Shareholding ratio of the Company (%) | Acquisition method | |
| Direct | Indirect | ||||||
| Shenzhen Haixing | Shenzhen China | Shenzhen China | Logistics support services | 53,072.92 | - | 67.00 | Business combination involving enterprises under common control |
| Shenzhen Lianyongtong Terminal Co., Ltd. | Shenzhen China | Shenzhen China | Logistics support services | USD 7,000,000 | - | 100.00 | Business combination involving enterprises under common control |
| Yide Port | Foshan China | Foshan China | Logistics support services | 21,600.00 | 51.00 | - | Business combination involving enterprises under common control |
| Mega SCT | BVI | BVI | Investment holding | USD 120.00 | - | 80.00 | Business combination involving enterprises under common control |
| Oasis King International Limited | BVI | BVI | Investment holding | USD 100.00 | - | 100.00 | Business combination involving enterprises under common control |
| Lome Container Terminal S.A. (Note 3) | Republic of Togo | Republic of Togo | Logistics support services | XOF 200,000,000 | - | 100.00 | Business combination involving enterprises under common control |
| Gainpro Resources Limited | BVI | BVI | Investment holding | USD 1.00 | - | 76.47 | Business combination involving enterprises under common control |
| Hambantota International Port Group (Private) Limited | Sri Lanka | Sri Lanka | Logistics support services | USD 1,145,480,000 | - | 85.00 | Business combination involving enterprises under common control |
| Shantou port | Shantou China | Shantou China | Logistics support services | 12,500.00 | - | 60.00 | Business combination involving enterprises under common control |
| Shenzhen Jinyu Rongtai Investment Development Co., Ltd. | Shenzhen China | Shenzhen China | Property lease, etc. | 80,000.00 | - | 100.00 | Business combination involving enterprises under common control |
| Shenzhen Merchants Qianhaiwan Real Estate Co., Ltd | Shenzhen China | Shenzhen China | Property lease, etc. | 20,000.00 | - | 100.00 | Asset acquisition |
| Juzhongzhi Investment (Shenzhen) Co., Ltd. | Shenzhen China | Shenzhen China | Investment consulting | 4,000.00 | - | 75.00 | Business combination involving enterprises under common control |
| Shenzhen Lianda Tugboat Co., Ltd. | Shenzhen China | Shenzhen China | Logistics support services | 200.00 | - | 60.29 | Business combination involving enterprises under common control |
| China Ocean Shipping Tally Zhangzhou Co., Ltd. | Zhangzhou China | Zhangzhou China | Logistics support services | 200.00 | - | 84.00 | Business combination involving enterprises under common control |
| China Merchants Holdings (Djibouti) FZE | Djibouti | Djibouti | Logistics support services | USD 38,140,000 | - | 100.00 | Business combination involving enterprises under common control |
| Xinda Resources Limited | BVI | BVI | Investment holding | USD 107,620,000 | - | 77.45 | Business combination involving enterprises under common control |
| Kong Rise Development Limited | HK China | HK China | Investment holding | USD 107,620,000 | - | 100.00 | Business combination involving enterprises under common control |
| TCP | Brazil | Brazil | Logistics support services | BRL 68,851,600 | - | 100.00 | Business combination not involving enterprises under common control |
| Direcet Achieve Investments Limited | HK China | HK China | Investment holding | USD 814,781,300 | - | 100.00 | Business combination involving enterprises under common control |
| Zhoushan RoRo | Zhoushan China | Zhoushan China | Logistics support services | 17,307.86 | 51.00 | - | Asset acquisition |
| Shenzhen Haixing Logistics Development Co., Ltd. | Shenzhen China | Shenzhen China | Logistics support services | 7,066.79 | - | 100.00 | Asset acquisition |
| Zhanjiang Port | Zhanjiang China | Zhanjiang China | Logistics support services | 587,420.91 | 30.78 | 27.58 | Business combination not involving enterprises under common control |
| Zhanjiang Port International Container Terminal Co., Ltd. | Zhanjiang China | Zhanjiang China | Logistics support services | 60,000.00 | - | 80.00 | Business combination not involving enterprises under common control |
| Zhanjiang Port Petrochemical Terminal Co., Ltd. (Note 4) | Zhanjiang China | Zhanjiang China | Logistics support services | 18,000.00 | - | 50.00 | Business combination not involving enterprises under common control |
| China Ocean Shipping Tally Co., Ltd., Zhanjiang | Zhanjiang China | Zhanjiang China | Logistics support services | 300.00 | - | 84.00 | Business combination not involving enterprises under common control |
| Zhanjiang Port Donghaidao Bulk Cargo Terminal Co., Ltd. | Zhanjiang China | Zhanjiang China | Logistics support services | 5,000.00 | - | 100.00 | Business combination not involving enterprises under common control |
| Zhanjiang Port Logistics | Zhanjiang China | Zhanjiang China | Logistics support services | 10,000.00 | - | 100.00 | Business combination not involving enterprises under common control |
| Guangdong Zhanjiang Port Longteng Shipping Co., Ltd. | Zhanjiang China | Zhanjiang China | Logistics support services | 9,000.00 | - | 51.00 | Business combination not involving enterprises under common control |
| Shantou Harbor Towage Service Co., Ltd. | Shantou China | Shantou China | Logistics support services | 1,000.00 | - | 100.00 | Established through investment |
| Sanya Merchants Port Development Co., Ltd. | Sanya China | Sanya China | Logistics support services | 1,000.00 | 51.00 | - | Established through investment |
| Malai Warehousing (Shenzhen) Co., Ltd | Shenzhen China | Shenzhen China | Owning China Qianhai property | HKD 1,600,000,000 | - | 100.00 | Business combination involving enterprises under common control |
| Ports Development (Hong Kong) Limited | Hong Kong China | Hong Kong China | Investment holding | 2,768,291.56 | 100.00 | - | Established through investment |
| Shunkong Port | Foshan China | Foshan China | Property development and management | 34,489.79 | 51.00 | - | Asset acquisition |
| South Asia Trade and Logistics Center Co., Ltd.("SACL") ( Note 5) | Sri Lanka | Sri Lanka | Logistics support services | USD 37,140,000 | - | 70.00 | Established through investment |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 148 -
(XI) EQUITY IN OTHER ENTITIES - continued
1. Interests in subsidiaries - continued
(1) Composition of the Group - Major subsidiaries - continued
Note 1: On 19 June 2018, the Company and China Merchants Group (Hong Kong) Co., Ltd.
("CMHK") entered into an "Agreement of Concerted Action on China Merchants PortHoldings Company Limited". According to the agreement, CMHK unconditionally keepsconsistent with the Company when voting for the matters discussed at the generalshareholders' meeting of CM Port in respect of its voting power of CM Port as entrusted,and performs the voting as per the Company's opinion. In March 2022, the Companytransferred its 43.00% equity contribution in China Merchants Port Holdings CompanyLimited to the wholly-owned subsidiary Ports Development (Hong Kong) Co., Ltd.
In June and October 2023, CM Port respectively distributed 2022 dividends and 2023interim dividends to shareholders. The shareholders may select to receive the dividendsall in cash or shares, or receive the dividends part in cash and part in new shares. TheCompany and Ports Development (Hong Kong) Co., Ltd. select to receive all dividendsattributable to their shareholdings in CM Port in the form of shares, and CMHK selects toreceive the 2022 dividends in cash and the 2023 interim dividends attributable to itsshareholding in CM Port in the form of shares. In 2023, Ports Development (Hong Kong)Co., Ltd. acquired 94,702,000 ordinary shares of CM Port from the secondary market.Upon the completion of above distribution and the transaction, the proportion of theordinary shares of CM Port held by the Group to the total issued ordinary shares of CMPort was changed from 45.69% to 49.28%, while the proportion of the ordinary shares ofCM Port held by CMHK to the total issued ordinary shares of CM Port was changed from
22.42% to 21.85%. Therefore, the Company has 71.13% voting power on CM Port in totaland is able to exercise control over CM Port.
Note 2: The Group and China Merchants Zhangzhou Development Zone Co., Ltd. entered into an
"Equity Custody Agreement", according to which China Merchants ZhangzhouDevelopment Zone Co., Ltd. entrusted its 29% equity of ZCMG to the Group for operationand management. Therefore, the Group has 60% voting power of ZCMG and includes itin the scope of consolidation of the consolidated financial statements.
Note 3: The Group is entitled to the nomination of most members of the executive commission
and has control over Lome Container Terminal S.A. Therefore, the Group includes it inthe scope of consolidation of the consolidated financial statements.
Note 4: The Group holds 50% equity interest in Zhanjiang Port Petrochemical Terminal Co., Ltd.
According to the agreement, the Group has control over Zhanjiang Port PetrochemicalTerminal Co., Ltd., and therefore includes it in the scope of consolidation of theconsolidated financial statements.
Note 5: SACL is a limited liability company established by CM Port in Sri Lanka on 21 April
2023.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 149 -
(XI) EQUITY IN OTHER ENTITIES - continued
1. Interests in subsidiaries - continued
(2) Significant non-wholly-owned subsidiaries
CHINA MERCHANTS PORT GROUP CO., LTD.
Name of thesubsidiary
| Name of the subsidiary | Proportion of ownership interest held by the minority shareholders (%) | Profit or loss attributable to minority shareholders in the current year | Dividends distributed to minority shareholders in the current year | Balance of minority interests at the end of the year |
| CM Port | 50.72 | 3,790,168,766.29 | 1,716,130,041.14 | 61,593,070,426.41 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 150 -
(XI) EQUITY IN OTHER ENTITIES - continued
1. Interests in subsidiaries - continued
(3) Major financial information of significant non-wholly-owned subsidiaries
CHINA MERCHANTS PORT GROUP CO., LTD.
Name of thesubsidiary
| Name of the subsidiary | 31/12/2023 | 31/12/2022 | ||||||||||
| Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | |
| CM Port | 15,917,026,132.04 | 135,313,877,243.36 | 151,230,903,375.40 | 18,457,977,486.53 | 27,802,818,508.45 | 46,260,795,994.98 | 12,837,082,258.94 | 137,558,098,661.09 | 150,395,180,920.03 | 18,761,895,893.60 | 25,152,356,977.50 | 43,914,252,871.10 |
| Name of the subsidiary | 2023 | 2022 | ||||||
| Operating income | Net profit | Total comprehensive income | Cash flows from operating activities | Operating income | Net profit | Total comprehensive income | Cash flows from operating activities | |
| CM Port | 10,503,277,811.44 | 6,466,697,575.11 | 7,608,794,449.88 | 4,852,710,141.52 | 10,926,649,847.41 | 7,771,272,424.87 | 9,468,881,467.49 | 5,181,954,271.51 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 151 -
(XI) EQUITY IN OTHER ENTITIES - continued
2. Transactions resulting from changes in ownership interests in subsidiaries without
losing control over the subsidiaries
(1) Description of changes in ownership interests in subsidiaries
During the year, the Group's ownership interests in CM Port is changed from 45.69% to 49.28%.Details are set out in Note (XI) 1 (1).
During the year, the Group's ownership interests in CM International Tech is changed from 56.92%to 100%.
During the year, the Group's ownership interests in Oasis King International Limited is changedfrom 70.00% to 100%.
(2) Effect of the transactions on minority interests and equity attributable to owners of the
Company
CHINA MERCHANTS PORT GROUP CO., LTD.
| CM Port | CM International Tech | Oasis King International Limited | Total | |
| Acquisition cost | ||||
| - Cash | 880,259,262.73 | 109,901,500.00 | 818,659,106.04 | 1,808,819,868.77 |
| - Fair value of non-cash assets | 1,398,559,890.07 | - | - | 1,398,559,890.07 |
| Total acquisition cost | 2,278,819,152.80 | 109,901,500.00 | 818,659,106.04 | 3,207,379,758.84 |
| Less: Share of net assets of subsidiaries calculated based on the proportion of equity acquired | 4,547,937,480.41 | 82,775,475.48 | 819,100,518.20 | 5,449,813,474.09 |
| Difference | -2,269,118,327.61 | 27,126,024.52 | -441,412.16 | -2,242,433,715.25 |
| Including: Adjustment to capital reserve | 2,269,118,327.61 | -27,126,024.52 | 441,412.16 | 2,242,433,715.25 |
| Adjustment to surplus reserve | - | - | - | - |
| Adjustment to unappropriated profit | - | - | - | - |
3. Interests in joint ventures and associates
(1) Significant joint ventures or associates
| Investee | Principal place of business | Place of registration | Nature of business | Proportion of ownership interests held by the Group (%) | Accounting treatment of investments in associates | |
| Direct | Indirect | |||||
| Associate | ||||||
| SIPG | Shanghai, PRC | Shanghai, PRC | Port and container terminal business | - | 28.05 | Equity method |
| Ningbo Zhoushan | Ningbo, PRC | Ningbo, PRC | Port and container terminal business | 20.98 | 2.10 | Equity method |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(XI) EQUITY IN OTHER ENTITIES - continued
4. Key financial information of significant associate
CHINA MERCHANTS PORT GROUP CO., LTD.
| SIPG | ||
| 31/12/2023 / 2023 | 31/12/2022/ 2022 | |
| Current assets | 53,049,570,240.87 | 46,525,054,810.02 |
| Including: Cash and cash equivalents | 35,721,676,040.14 | 26,843,326,028.04 |
| Non-current assets | 150,525,944,932.10 | 135,276,650,788.84 |
| Total assets | 203,575,515,172.97 | 181,801,705,598.86 |
| Current liabilities | 22,835,359,505.98 | 25,863,891,496.14 |
| Non-current liabilities | 44,553,743,360.00 | 34,770,765,671.21 |
| Total liabilities | 67,389,102,865.98 | 60,634,657,167.35 |
| Net assets | 136,186,412,306.99 | 121,167,048,431.51 |
| Minority interests | 13,010,972,126.11 | 8,839,640,972.54 |
| Net assets attributable to owners of the Company | 123,175,440,180.88 | 112,327,407,458.97 |
| Share of net assets calculated based on the proportion of ownership interests | 34,550,710,970.74 | 31,507,837,792.24 |
| Adjustments | ||
| - Goodwill | 2,427,508,397.27 | 2,427,508,397.27 |
| - Others | 234,665,770.76 | 236,552,011.66 |
| Carrying amount of equity investments in associates | 37,212,885,138.77 | 34,171,898,201.17 |
| Fair value of publicly quoted equity investments in associates | 32,003,432,940.50 | 34,877,210,592.30 |
| Operating income | 37,551,570,005.56 | 37,279,806,723.63 |
| Net profit | 14,007,787,452.35 | 17,910,112,648.83 |
| Other comprehensive income | -58,126,233.99 | -526,788,637.24 |
| Total comprehensive income | 13,949,661,218.36 | 17,383,324,011.59 |
| Dividends received from associates in the current year | 914,383,798.30 | 1,240,688,187.97 |
| Ningbo Zhoushan | |
| 31/12/2023 | |
| Current assets | 19,223,549,000.00 |
| Including: Cash and cash equivalents | 9,635,337,000.00 |
| Non-current assets | 93,105,852,000.00 |
| Total assets | 112,329,401,000.00 |
| Current liabilities | 22,201,633,000.00 |
| Non-current liabilities | 9,429,720,000.00 |
| Total liabilities | 31,631,353,000.00 |
| Net assets | 80,698,048,000.00 |
| Minority interests | 5,828,457,000.00 |
| Net assets attributable to owners of the Company | 74,869,591,000.00 |
| Share of net assets calculated based on the proportion of ownership interests | 17,279,901,602.80 |
| Adjustments | |
| - Goodwill | 1,231,115,756.87 |
| - Others | 120,136,754.64 |
| Carrying amount of equity investments in associates | 18,631,154,114.31 |
| Fair value of publicly quoted equity investments in associates | 15,982,528,312.20 |
| Operating income | 25,993,200,000.00 |
| Net profit | 5,156,174,000.00 |
| Other comprehensive income | 76,072,000.00 |
| Total comprehensive income | 5,232,246,000.00 |
| Dividends received from associates in the current year | 390,875,794.33 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 153 -
(XI) EQUITY IN OTHER ENTITIES - continued
4. Key financial information of significant associate - continued
Note: Ningbo Zhoushan has become an important associate this year and only disclosed financial
data for this year, Ningbo Zhoushan's financial data are accurate to the nearest RMB1,000.00.
5. Summarized financial information of insignificant associates and joint ventures
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 31/12/2023 /2023 | 31/12/2022 / 2022 (Restated) |
| Joint ventures: | — — | — — |
| Total carrying amount of investments | 8,957,993,335.22 | 9,716,793,055.72 |
| Aggregate of following items calculated based on the proportion of ownership interest | — — | — — |
| - Net profit | 396,604,681.06 | 419,341,721.80 |
| - Other comprehensive income | -879,272,391.47 | 175,421,702.38 |
| - Total comprehensive income | -482,667,710.41 | 594,763,424.18 |
| Associates: | — — | — — |
| Total carrying amount of investments | 31,864,085,187.97 | 48,475,602,662.16 |
| Aggregate of following items calculated based on the proportion of ownership interest | — — | — — |
| - Net profit | 831,571,993.78 | 2,003,274,864.02 |
| - Other comprehensive income | 138,977,006.59 | -300,868,120.56 |
| - Total comprehensive income | 970,549,000.37 | 1,702,406,743.46 |
6. The investees where the Group holds long-term equity investments are not restricted
to transfer funds to the Group.
(XII) GOVERNMENT GRANTS
1. Government grants recognised as receivables at the end of current year
| Balance of receivables as at the end of current year | 2,181,470.00 |
2. Liabilities involving government grants
| Item | 31/12/2022 | New government grants | Amount included in non-operating income | Amount included in other income | Other changes | 31/12/2023 | Related to assets/income |
| Deferred income | 1,031,273,189.74 | 41,207,834.25 | - | 47,704,466.26 | - | 1,024,776,557.73 | Related to assets |
| Total | 1,031,273,189.74 | 41,207,834.25 | - | 47,704,466.26 | - | 1,024,776,557.73 | — — |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 154 -
(XII) GOVERNMENT GRANTS - continued
3. Government grants included in profit or loss
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 2023 | 2022 |
| Business development subsidy | 113,983,657.91 | 94,355,004.33 |
| Special fund for operation | 18,439,586.22 | 7,385,898.57 |
| Steady post subsidies | 1,682,015.15 | 5,771,198.38 |
| Others | 15,133,244.06 | 42,331,663.35 |
| Total | 149,238,503.34 | 149,843,764.63 |
(XIII) RISKS ASSOCIATED WITH FINANCIAL INSTRUMENTS
The Group's major financial instruments include cash and bank balances, held-for-trading financialassets, notes receivable, accounts receivable, receivables financing, other receivables, long-termreceivables, other non-current financial assets, borrowings, notes payable, accounts payable, otherpayables, other current liabilities, non-current liabilities due within one year, bonds payable, long-term payables, other non-current liabilities, etc. Details of these financial instruments are disclosedin Note (VIII). The risks associated with these financial instruments and the policies on how tomitigate these risks are set out below. Management of the Group manages and monitors theseexposures to ensure the risks are monitored at a certain level.
The Group adopts sensitivity analysis technique to analyse how the profit and loss for the periodand shareholders' equity would have been affected by reasonably possible changes in the relevantrisk variables. As it is unlikely that risk variables will change in an isolated manner, and theinterdependence among risk variables will have significant effect on the amount ultimatelyinfluenced by the changes in a single risk variable, the following are based on the assumption thatthe change in each risk variable is on a stand-alone basis.
1. Risk management objectives, policies and procedures, and changes for the period
The Group's risk management objectives are to achieve a proper balance between risks and yield,minimise the adverse impacts of risks on the Group's operation performance, and maximise thebenefits of the shareholders and other stakeholders. Based on these risk management objectives, theGroup's basic risk management strategy is to identify and analyse the Group's exposure to variousrisks, establish an appropriate maximum tolerance to risk, implement risk management, andmonitors regularly and effectively these exposures to ensure the risks are monitored at a certainlevel.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(XIII) RISKS ASSOCIATED WITH FINANCIAL INSTRUMENTS - continued
1. Risk management objectives, policies and procedures, and changes for the period- continued
1.1 Market risk
1.1.1 Currency risk
Currency risk is the risk that losses will occur because of changes in foreign exchange rates. TheGroup's exposure to the currency risk is primarily associated with HKD, USD and EUR. Except forpart of the purchases and sales, the Group's other principal activities are denominated and settled inRMB. As at 31 December 2023, the balances of the Group's assets and liabilities are bothdenominated in functional currency, except that the assets and liabilities set out below are recordedusing foreign currencies. Currency risk arising from the foreign currency balance of assets andliabilities may have impact on the Group's performance.
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 31/12/2023 | 31/12/2022 |
| Cash and bank balances | 487,182,682.32 | 799,833,569.05 |
| Accounts receivable | 10,544,159.14 | 29,766,083.42 |
| Other receivables | 339,131,902.71 | 360,531,571.16 |
| Long-term receivables | 204,300,125.00 | - |
| Short-term borrowings | 2,990,000,000.00 | 4,090,000,000.00 |
| Accounts payable | 1,379,762.77 | 2,372,883.60 |
| Other payables | 300,187,007.82 | 246,131,122.92 |
| Non-current liabilities due within one year | 9,339,586.11 | 670,000,000.00 |
| Long-term borrowings | 4,656,000,000.00 | 3,669,000,000.00 |
| Long-term payables | 9,391,615.50 | - |
The Group closely monitors the effects of changes in the foreign exchange rates on the Group'scurrency risk exposures. According to the current risk exposure and judgment on the exchange ratemovements, the management considers it is unlikely that the exchange rate changes in the next yearwill result in significant loss to the Group.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(XIII) RISKS ASSOCIATED WITH FINANCIAL INSTRUMENTS - continued
1. Risk management objectives, policies and procedures, and changes for the period- continued
1.1 Market risk - continued
1.1.1 Currency risk - continued
Sensitivity analysis on currency risk
The assumption for the sensitivity analysis on currency risk is that all the cash flow hedges andhedges of a net investment in a foreign operation are highly effective. On the basis of the aboveassumption, where all other variables are held constant, the reasonably possible changes in theforeign exchange rate may have the following pre-tax effect on the profit or loss for the period andshareholders' equity:
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Changes in exchange rate | 2023 | 2022 | ||
| Effect on profit | Effect on shareholders' equity | Effect on profit | Effect on shareholders' equity | ||
| All foreign currencies | 5% increase against RMB | -362,713,439.88 | -362,713,439.88 | -383,846,068.61 | -383,846,068.61 |
| All foreign currencies | 5% decrease against RMB | 362,713,439.88 | 362,713,439.88 | 383,846,068.61 | 383,846,068.61 |
| All foreign currencies | 5% increase against USD | -18,083,083.38 | -18,083,083.38 | 5,221,127.37 | 5,221,127.37 |
| All foreign currencies | 5% decrease against USD | 18,083,083.38 | 18,083,083.38 | -5,221,127.37 | -5,221,127.37 |
| All foreign currencies | 5% increase against HKD | 23,046,933.58 | 23,046,933.58 | 3,837,255.04 | 3,837,255.04 |
| All foreign currencies | 5% decrease against HKD | -23,046,933.58 | -23,046,933.58 | -3,837,255.04 | -3,837,255.04 |
| All foreign currencies | 5% increase against EUR (including FCFA) | 11,592,634.53 | 11,592,634.53 | 419,047.06 | 419,047.06 |
| All foreign currencies | 5% decrease against EUR (including FCFA) | -11,592,634.53 | -11,592,634.53 | - 419,047.06 | - 419,047.06 |
1.1.2 Interest rate risk - changes in cash flows
Risk of changes in cash flows of financial instruments arising from interest rate changes is mainlyrelated to bank loans with floating interest rate. (See Note (VIII) 24 and Note (VIII) 34). The Groupcontinuously and closely monitors the impact of interest rate changes on the Group's interest raterisk. The Group's policy is to maintain these borrowings at floating rates. Presently, the Group hasno arrangement such as interest rate swaps.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 157 -
(XIII) RISKS ASSOCIATED WITH FINANCIAL INSTRUMENTS - continued
1. Risk management objectives, policies and procedures, and changes for the period- continued
1.1 Market risk - continued
1.1.2 Interest rate risk - changes in cash flows - continued
Sensitivity analysis on interest rate risk
Sensitivity analysis on interest rate risk is based on the following assumptions:
? Fluctuations of market interest rate can affect the interest income or expense of a financialinstrument with floating interest rate;? For a financial instrument at fair value with fixed interest rate, the fluctuations of market interest rate
can only affect its interest income or expense;? For a derivative financial instrument designated as hedging instrument, the fluctuations of marketinterest rate affect its fair value, and all interest rate hedges are expected to be highly effective;? The changes in fair value of derivative financial instruments and other financial assets and liabilitiesare calculated using cash flow discounting method by applying the market interest rate at balancesheet date.
On the basis of above assumptions, where the other variables held constant, the pre-tax effect ofpossible and reasonable changes in interest rate on the profit or loss for the period and shareholders'equity are as follows:
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Changes in interest rate | 2023 | 2022 | ||
| Effect on profit | Effect on shareholders' equity | Effect on profit | Effect on shareholders' equity | ||
| Short-term borrowings and long-term borrowings | 1% increase | -342,406,182.88 | -342,406,182.88 | -207,621,560.74 | -207,621,560.74 |
| Short-term borrowings and long-term borrowings | 1% decrease | 342,406,182.88 | 342,406,182.88 | 207,621,560.74 | 207,621,560.74 |
1.2 Credit risk
As at 31 December 2023, the Group's maximum exposure to credit risk which will cause a financialloss to the Group due to failure to discharge an obligation by the counterparties and financialguarantees issued by the Group (without considering the available collateral or other creditenhancements) is arising from cash and bank balances (Note (VIII), 1), notes receivable (Note(VIII), 3), accounts receivable (Note (VIII), 4), other receivables (Note (VIII), 7), long-termreceivables (Note (VIII), 11), etc. At the balance sheet date, the carrying amounts of the Group'sfinancial assets represent its maximum exposure to credit risk. In addition, the Group's maximumcredit risk exposure to credit losses includes the amount of financial guarantee contract as disclosedin Note (XVII), 2 "Contingencies".
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 158 -
(XIII) RISKS ASSOCIATED WITH FINANCIAL INSTRUMENTS - continued
1. Risk management objectives, policies and procedures, and changes for the period- continued
1.2 Credit risk - continued
In order to minimise the credit risk, the Group has delegated a department responsible fordetermination of credit limits, credit approvals and other monitoring procedures to ensure thatfollow-up action is taken to recover overdue debts. In addition, the Group reviews the recoverableamount of financial assets at each balance sheet date to ensure that adequate provision for creditloss is made for relevant financial assets. In this regard, the management of the Group considersthat the Group's credit risk is significantly reduced.
The credit risk on cash and bank balances is limited because they are deposited with financialinstitutions with high credit ratings.
The Group has no significant concentration of credit risk, with exposure spread over a number ofcounterparties and customers.
The Group has adopted a policy to ensure that all sales customers have good credit records.
1.3 Liquidity risk
In the management of the liquidity risk, the Group monitors and maintains a level of cash and cashequivalents deemed adequate by the management to finance the Group's operations and mitigatethe effects of fluctuations in cash flows. The management monitors the utilisation of bankborrowings and ensures compliance with loan covenants.
As at 31 December 2023, the Group had total current liabilities in excess of total current assets ofRMB 5,612,418,164.44. As at 31 December 2023, the Group had available and unused line of creditand bonds amounting to RMB 69,439,268,355.68, which is greater than the balance of the netcurrent liabilities. The Group can obtain financial support from the available line of credit and bondswhen needed. Therefore, the Group's management believes that the Group has no significantliquidity risk.
The following is the maturity analysis for financial assets and financial liabilities held by the Groupwhich is based on undiscounted remaining contractual obligations:
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Carrying amount | Gross amount | Within 1 year | 1 to 5 years | Over 5 years |
| Short-term borrowings | 15,714,045,288.97 | 16,173,813,350.97 | 16,173,813,350.97 | - | - |
| Notes payable | 73,461,165.82 | 73,461,165.82 | 73,461,165.82 | - | - |
| Accounts payable | 691,765,137.25 | 691,765,137.25 | 691,765,137.25 | - | - |
| Other payables | 1,654,622,170.02 | 1,654,622,170.02 | 1,654,622,170.02 | - | - |
| Non-current liabilities due within one year | 6,745,613,464.04 | 7,946,167,971.57 | 7,946,167,971.57 | - | - |
| Other current liabilities | 2,143,842,534.53 | 2,153,429,383.85 | 2,153,429,383.85 | - | - |
| Long-term borrowings | 18,227,543,954.71 | 19,240,642,199.11 | - | 17,013,554,984.11 | 2,227,087,215.00 |
| Bonds payable | 14,287,508,564.15 | 15,590,487,807.53 | - | 15,590,487,807.53 | - |
| Lease liabilities | 1,001,172,206.92 | 2,484,068,796.64 | - | 282,009,548.65 | 2,202,059,247.99 |
| Long-term payables | 3,817,255,549.15 | 6,096,325,412.76 | - | 826,260,924.50 | 5,270,064,488.26 |
| Related-party guarantees | 347,437,758.18 | 347,437,758.18 | 114,527,259.00 | 156,254,811.86 | 76,655,687.32 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 159 -
(XIV) DISCLOSURE OF FAIR VALUE
1. Closing balance of assets and liabilities measured at fair value
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Fair value at 31/12/2023 | |||
| Level 1 | Level 2 | Level 3 | Total | |
| Fair value measurement | Fair value measurement | Fair value measurement | ||
| Continuously measured at fair value | ||||
| Held-for-trading financial assets | - | 4,568,806,108.84 | - | 4,568,806,108.84 |
| Receivables financing | - | - | 2,001,669.46 | 2,001,669.46 |
| Investments in other equity instruments | - | - | 157,461,648.16 | 157,461,648.16 |
| Other non-current financial assets | 850,222,729.23 | - | 27,353,713.60 | 877,576,442.83 |
| Total assets continuously measured at fair value | 850,222,729.23 | 4,568,806,108.84 | 186,817,031.22 | 5,605,845,869.29 |
2. Basis for determining the market price of items continuously measured at level 1 fair
value
The market prices of held-for-trading financial assets and other non-current financial assets aredetermined based on the closing price of the equity instruments at Stock Exchange at 31 December2023.
3. Qualitative and quantitative information of valuation techniques and key parameters
adopted for items continuously measured at level 2 fair value
| Item | Fair value at 31/12/2023 | Valuation techniques | Inputs |
| Held-for-trading financial assets | 4,568,806,108.84 | Cash flow discounting | Expected rate of return |
The fair value of debt instruments at fair value through profit or loss is determined using the cashflow discounting approach. During the valuation, the Group adopts the expected return as the input.
4. Qualitative and quantitative information of valuation techniques and key parameters
adopted for items continuously measured at level 3 fair value
| Item | Fair value at 31/12/2023 | Valuation techniques | Inputs |
| Receivables financing | 2,001,669.46 | Cash flow discounting | Discount rate |
| Investments in other equity instruments | 157,461,648.16 | Net worth method | Carrying amount |
| Other non-current financial assets | 737,436.89 | Net worth method | Carrying amount |
| Other non-current financial assets | 26,616,276.71 | Listed company comparison approach | Share price |
The fair value of non-listed equity instruments included in equity instruments at fair value throughprofit or loss or other comprehensive income is determined using the valuation techniques such asnet worth method, listed company comparison approach etc.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 160 -
(XIV) DISCLOSURE OF FAIR VALUE - continued
5. Fair value of financial assets and financial liabilities not measured at fair value
The financial assets and liabilities not measured at fair value mainly include notes receivable,accounts receivable, other receivables, short-term borrowings, notes payable, accounts payable,other payables, long-term borrowings, bonds payable, lease liabilities and long-term payables etc.
The Group's management believes that the carrying amounts of financial assets and financialliabilities at amortized cost in the financial statements approximate their fair values.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 161 -
(XV) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS
1. Parent of the Company
CHINA MERCHANTS PORT GROUP CO., LTD.Name of the Company
| Name of the Company | Related party relationship | Type of the entity | Place of registration | Nature of business | Issued share capital | Proportion of ownership interests held by the Company (%) | Proportion of voting power held by the Company (%) |
| Broadford Global Limited | Parent | Private limited company (share limited) | Hong Kong | Investment holding | HKD 21,120,986,262 | 2.21 | 63.01 (Note) |
Note: Broadford Global Limited directly holds 2.21% equity of the Company, and indirectly holds 14.84% and 45.96% equity of the Company through
the subsidiaries China Merchants Gangtong Development (Shenzhen) Co., Ltd. and China Merchants Port Investment Development CompanyLimited respectively. The ultimate controlling shareholder of the Company is China Merchants Group.
2. Subsidiaries of the Company
Details of the subsidiaries of the Company are set out in Note (X) 1, Note (XI) 1.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 162 -
(XV) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
3. Associates and joint ventures of the Company
Details of the Company's significant joint ventures and associates are set out in Note (XI) 3.
Other joint ventures or associates that have related party transactions with the Group in the currentyear, or formed balances of related party transactions with the Group in the prior year are as follows:
CHINA MERCHANTS PORT GROUP CO., LTD.Name of joint venture or associate
| Name of joint venture or associate | Relationship with the Company |
| Port of Newcastle and its subsidiaries | Joint venture |
| Guizhou East Land Port Operation Co., Ltd. | Joint venture |
| Qingdao Qianwan United Container Terminal Co., Ltd. | Joint venture |
| Qingdao Qianwan West Port United Wharf Co., Ltd. | Joint venture |
| Qingdao Qianwan New United Container Terminal Co., Ltd. | Joint venture |
| COSCO Logistics (Zhanjiang) Co., Ltd. | Joint venture |
| China Ocean Shipping Agency (Zhanjiang) Co., Ltd | Joint venture |
| Yantai Port Group Laizhou Port Co., Ltd. | Joint venture |
| Qingdao Wutong Century Supply Chain Co., Ltd. | Joint venture |
| China Merchants Port (Shenzhen) Industrial Innovation Private Equity Investment Fund Partnership (Limited Partnership) ("Investment Fund") | Joint venture |
| Doraleh Multi-purpose Port | Associate |
| Great Horn Development Company FZCo | Associate |
| International Djibouti Industrial Parks Operation FZCo | Associate |
| Port de Djibouti S.A. | Associate |
| Terminal Link SAS | Associate |
| Tin-Can Island Container Terminal Ltd | Associate |
| Guizhou Qiandongnan Continental Land Port Operation Co., Ltd. | Associate |
| Nanshan Group and its subsidiaries | Associate |
| SIPG | Associate |
| Ningbo Zhoushan and its subsidiaries | Associate |
| Shenzhen Baohong Technology Co., Ltd. | Associate |
| Tianjin Haitian Bonded Logistics Co., Ltd. | Associate |
| Merchants Port City | Associate |
| Zhanjiang Xiagang United Development Co., Ltd. | Associate |
| Chu Kong River Trade Terminal Co., Ltd. | Associate |
| Shantou Zhonglian Tally Co., Ltd | Associate |
| Shantou International Container Terminals Limited | Associate |
| Shenzhen Bay Electricity Industry Co., Ltd. | Associate |
| Tianjin Port Container Terminal Co., Ltd. | Associate |
| Lac Assal Investment Holding Company Limited | Associate |
| CM Port Chuangrong (Shenzhen) Technology Co., Ltd. | Associate |
| Ningbo Port Container Transportation Co., Ltd. | Associate |
| Shenzhen Chiwan Haike Industrial Operation Co., Ltd. | Associate |
| Liaoning Port and its subsidiaries | Associate, controlled by the same ultimate controlling shareholder |
| New Land-Sea Corridor Operation (Zhanjiang) Co., Ltd. | Associate |
| Antong Holdings and its subordinate companies | Associate |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 163 -
(XV) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
4. Other related parties of the Company
CHINA MERCHANTS PORT GROUP CO., LTD.Name of other related parties
| Name of other related parties | Relationship with the Company |
| Zhoushan Blue Ocean Investment Co., Ltd. | Minority shareholder of subsidiary |
| Sri Lanka Ports Authority | Minority shareholder of subsidiary |
| Guangdong Shunkong City Investment Real Estate Co. Ltd. | Minority shareholder of subsidiary |
| Zhanjiang Infrastructure Construction Investment Group Co., Ltd. | Minority shareholder of subsidiary |
| Dalian Port Logistics Technology Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Dalian Port Communications Engineering Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Marine Shipping Agency Guangdong Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Hoi Tung (Shanghai) Company Limited | Controlled by the same ultimate controlling shareholder |
| South China Sinotrans Supply Chain Management Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| EuroAsia Dockyard Enterprise and Development Limited | Controlled by the same ultimate controlling shareholder |
| Qingdao Bonded Logistics Park Sinotrans Warehousing Logistics Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Qingdao Sinotrans Supply Chain Management Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Penavico Shenzhen Warehousing Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Shenzhen Nanyou (Holdings) Ltd. | Controlled by the same ultimate controlling shareholder |
| Sinotrans Shenzhen Qianhai Supply Chain Management Ltd. | Controlled by the same ultimate controlling shareholder |
| Shenzhen Qianhai Shekou Free Trade Investment Development Co. Ltd. | Controlled by the same ultimate controlling shareholder |
| China Merchants International Shipping Agency (Shenzhen) Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Merchants Real Estate (Shenzhen) Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Merchants Real Estate Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Shenzhen Merchants to Home Technology Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Merchants Shenzhen Ro-Ro Shipping Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Merchants Commercial Property Investment (Shenzhen) Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Merchants Property Management (Shenzhen) Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Marine Shipping Agency Shenzhen Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Yiu Lian Dockyards (Shekou) Limited | Controlled by the same ultimate controlling shareholder |
| Yiu Lian Dockyards Limited | Controlled by the same ultimate controlling shareholder |
| China Merchants International Cold Chain (Shenzhen) Company Limited | Controlled by the same ultimate controlling shareholder |
| China Merchants Group Finance Company Limited | Controlled by the same ultimate controlling shareholder |
| China Merchants Port Investment Development Company Limited | Controlled by the same ultimate controlling shareholder |
| China Merchants Finance Lease (Shanghai) Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Merchants Finance Lease (Tianjin) Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Merchants Shekou Industrial Zone Holdings Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Merchant Food (China) Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Merchants Tongshang Finance Lease Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Merchants Zhangzhou Development Zone Power Supply Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Merchants Securities Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Traffic Import and Export Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Sinotrans Changhang Group Limited | Controlled by the same ultimate controlling shareholder |
| Shenzhen Dehan Investment Development Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Marine Shipping Agency Guangdong Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Merchants Healthcare (Qichun) Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Ocean Shipping Tally Shenzhen Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Sinotrans Central China Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Sinotrans (HK) Shipping Limited | Controlled by the same ultimate controlling shareholder |
| Sinoway Shipping Ltd. | Controlled by the same ultimate controlling shareholder |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 164 -
(XV) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
4. Other related parties of the Company - continued
CHINA MERCHANTS PORT GROUP CO., LTD.Name of other related parties
| Name of other related parties | Relationship with the Company |
| China Merchants Heavy Industry (Jiangsu) Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Sinotrans Shantou Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Merchants-Logistics Shenzhen Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Merchants Zhangzhou Development Zone Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Ocean Shipping Agency Shenzhen Co. Ltd. | Controlled by the same ultimate controlling shareholder |
| China Marine Shipping Agency Ningbo Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Sinotrans Container Lines (Hong Kong) Company Limited | Controlled by the same ultimate controlling shareholder |
| Sinotrans Container Lines Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Yingkou Port Group Co., Ltd. and its subsidiaries ("Yingkou Port Group") | Controlled by the same ultimate controlling shareholder |
| Liaoning Port Group Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Liaoning Electronic Port Co., Ltd | Controlled by the same ultimate controlling shareholder |
| China Yangtze River Shipping Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Merchants Gangrong Big Data Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Dalian Port Construction Supervision Consulting Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Dalian Port Group Corporation Limited | Controlled by the same ultimate controlling shareholder |
| Dalian Container Terminal Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Shenzhen West Port Security Service Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Dalian Port Container | Controlled by the same ultimate controlling shareholder |
| China Merchants Apartment Development (Shenzhen) Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Dalian Bonded Zone Yongdexin Real Estate Development & Construction Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Jifa Logistics | Controlled by the same ultimate controlling shareholder |
| Dalian Jifa South Coast International Logistics Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Dalian Jifa Port Logistics Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| CHINA MERCHANTS SHIPPING AND ENTERPRISES COMPANY LIMITED | Controlled by the same ultimate controlling shareholder |
| Ningbo Transocean International Forwarding Agency Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Qingdao Sinotrans Mining Technology Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Yingkou Xingang Kuangshi Terminals Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Dandong Port Group Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| China Merchants Port and Shipping Digital Technology (Liaoning) Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Ocean Driller III Limited | Controlled by the same ultimate controlling shareholder |
| Dalian Ganglong Technology Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Qingdao Sinotrans Logistics Co., Ltd. | Controlled by the same ultimate controlling shareholder |
| Shenzhen Wanhai Building Management Co., Ltd. | Significantly influenced by the ultimate controlling shareholder |
| China Merchants Union (BVI) limited | Significantly influenced by the ultimate controlling shareholder |
| Datong Securities Co., Ltd | Significantly influenced by the ultimate controlling shareholder |
| Dalian Automobile Terminal Co., Ltd | Significantly influenced by the ultimate controlling shareholder |
| Dalian Port Design Research Institute Co., Ltd. | Significantly influenced by the ultimate controlling shareholder |
| Khor Ambado FZCo | Significantly influenced by the ultimate controlling shareholder |
| China Merchants Bank Co., Ltd. | Significantly influenced by the ultimate controlling shareholder |
| China Merchants (Shenzhen) Power Supply Co., Ltd. | Significantly influenced by the ultimate controlling shareholder |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 165 -
(XV) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions
(1) Rendering and receipt of services
CHINA MERCHANTS PORT GROUP CO., LTD.
Related party
| Related party | Content of transaction | Pricing method and decision procedures of related transactions | 2023 | 2022 | |
| Receipt of services: | |||||
| Shenzhen Bay Electricity Industry Co., Ltd. | Service expense | Negotiation | 56,553,895.23 | 55,476,519.62 | |
| Shenzhen Nanyou (Holdings) Ltd. | Service expense | Negotiation | 37,373,052.06 | 5,764,441.32 | |
| China Merchants (Shenzhen) Power Supply Co., Ltd. | Service expense | Negotiation | 19,085,551.42 | 17,893,208.32 | |
| Qingdao Qianwan West Port United Wharf Co., Ltd. | Service expense | Negotiation | 18,954,315.25 | 18,229,532.95 | |
| China Merchants Property Management (Shenzhen) Co., Ltd. | Service expense | Negotiation | 15,013,993.93 | 7,959,601.92 | |
| Nanshan Group and its subsidiaries | Service expense | Negotiation | 12,922,553.88 | 20,553,330.63 | |
| Ocean Driller III Limited | Service expense | Negotiation | 12,444,743.72 | - | |
| Shenzhen West Port Security Service Co., Ltd. | Service expense | Negotiation | 11,300,450.18 | 11,952,754.94 | |
| Yiu Lian Dockyards Limited | Service expense | Negotiation | 8,104,140.51 | 8,489,653.19 | |
| Ningbo Zhoushan and its subsidiaries | Service expense | Negotiation | 7,569,178.76 | 14,417,120.66 | |
| China Merchants Zhangzhou Development Zone Power Supply Co., Ltd. | Service expense | Negotiation | 6,449,368.77 | 5,562,706.02 | |
| International Djibouti Industrial Parks Operation FZCo | Service expense | Negotiation | 6,264,666.66 | 2,344,919.84 | |
| Hoi Tung (Shanghai) Company Limited | Service expense | Negotiation | 5,014,184.85 | 19,923,373.82 | |
| China Merchants Commercial Property Investment (Shenzhen) Co., Ltd. | Service expense | Negotiation | 5,000,000.00 | 3,896,620.63 | |
| Other related parties | Service expense | Negotiation | 37,272,690.46 | 60,512,567.41 | |
| China Merchants Bank Co., Ltd. | Purchase of structured deposits | Negotiation | 3,180,000,000.00 | 900,061,111.11 | |
| China Merchants Group Finance Company Limited | Interest expense | Negotiation | 26,303,900.66 | 74,066,413.54 | |
| China Merchants Bank Co., Ltd. | Interest expense | Negotiation | 17,596,634.76 | 8,970,399.98 | |
| China Merchants Finance Lease (Tianjin) Co., Ltd. | Interest expense | Negotiation | 2,117,332.10 | 724,437.17 | |
| Total | 3,485,340,653.20 | 1,236,798,713.07 | |||
| Rendering of service: | |||||
| COSCO Logistics (Zhanjiang) Co., Ltd. | Service income | Negotiation | 243,101,038.82 | 203,783,472.45 | |
| Antong Holdings and its subordinate companies | Service income | Negotiation | 108,978,140.94 | 124,308,389.86 | |
| Liaoning Port and its subsidiaries | Service income | Negotiation | 80,155,659.35 | 165,608,963.82 | |
| China Ocean Shipping Agency (Zhanjiang) Co., Ltd | Service income | Negotiation | 75,114,485.59 | 59,100,409.00 | |
| Qingdao Qianwan United Container Terminal Co., Ltd. | Service income | Negotiation | 69,319,211.87 | 61,896,678.04 | |
| China Marine Shipping Agency Guangdong Co., Ltd. | Service income | Negotiation | 36,263,254.23 | 57,816,828.74 | |
| China Merchants International Shipping Agency (Shenzhen) Co., Ltd. | Service income | Negotiation | 26,223,978.84 | 29,854,035.10 | |
| Yingkou Port Group Co., Ltd. and its subsidiaries ("Yingkou Port Group") | Service income | Negotiation | 25,600,739.56 | 41,932,643.50 | |
| Yiu Lian Dockyards (Shekou) Limited | Service income | Negotiation | 12,403,540.05 | 15,088,720.57 | |
| Sinotrans Container Lines Co., Ltd. | Service income | Negotiation | 11,703,055.83 | 7,891,652.35 | |
| Sinotrans Shenzhen Qianhai Supply Chain Management Ltd. | Service income | Negotiation | 10,684,159.25 | 5,354,930.31 | |
| New Land-Sea Corridor Operation (Zhanjiang) Co., Ltd. | Service income | Negotiation | 9,724,814.72 | - | |
| CM Port Chuangrong (Shenzhen) Technology Co., Ltd. | Service income | Negotiation | 8,632,714.51 | 8,665,860.83 | |
| Shenzhen Baohong Technology Co., Ltd. | Service income | Negotiation | 8,201,361.90 | 5,562,857.25 | |
| China Merchants International Cold Chain (Shenzhen) Company Limited | Service income | Negotiation | 7,196,978.46 | 4,050,145.80 | |
| China Merchants Port Investment Development Company Limited | Service income | Negotiation | 6,905,698.13 | 1,907,632.07 | |
| China Ocean Shipping Agency Shenzhen Co. Ltd. | Service income | Negotiation | 6,779,104.47 | 4,966,841.25 | |
| Other related parties | Service income | Negotiation | 81,221,890.50 | 141,359,228.82 | |
| Terminal Link SAS | Service income | Negotiation | 138,262,807.50 | 169,844,015.81 | |
| Port of Newcastle and its subsidiaries | Service income | Negotiation | 55,424,394.92 | 17,721,583.77 | |
| China Merchants Bank Co., Ltd. | Service income | Negotiation | 51,248,973.95 | 105,426,962.23 | |
| China Merchants Group Finance Company Limited | Service income | Negotiation | 33,052,458.75 | 25,519,980.42 | |
| Tianjin Haitian Bonded Logistics Co., Ltd. | Service income | Negotiation | 1,210,342.38 | 1,558,375.91 | |
| China Merchants Union (BVI) limited | Default income | Negotiation | 34,137,339.48 | - | |
| Total | 1,141,546,144.00 | 1,259,220,207.90 | |||
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 166 -
(XV) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions - continued
(2) Leases with related parties
The Group as the lessor:
CHINA MERCHANTS PORT GROUP CO., LTD.
Name of the lessee
| Name of the lessee | Type of leased assets | Pricing method and decision procedures of related transactions | Lease income recognized in the current year | Lease income recognized in the prior year |
| Qingdao Qianwan West Port United Wharf Co., Ltd. | Buildings and structures | Negotiation | 14,311,677.72 | 10,222,395.86 |
| Qingdao Bonded Logistics Park Sinotrans Warehousing Logistics Co., Ltd. | Port and terminal facilities | Negotiation | 6,680,118.90 | 6,876,165.97 |
| China Merchant Food (China) Co., Ltd. | Buildings and structures | Negotiation | 5,964,675.96 | 5,683,461.66 |
| China Traffic Import and Export Co., Ltd. | Buildings and structures | Negotiation | 5,473,072.56 | 5,473,072.56 |
| Qingdao Sinotrans Mining Technology Co., Ltd. | Buildings and structures | Negotiation | 4,750,557.12 | 4,750,557.12 |
| Qingdao Sinotrans Supply Chain Management Co., Ltd. | Buildings and structures | Negotiation | 3,438,231.48 | 3,558,552.62 |
| Qingdao Qianwan United Container Terminal Co., Ltd. | Buildings and structures | Negotiation | 3,323,938.08 | 3,037,651.81 |
| CM Port Chuangrong (Shenzhen) Technology Co., Ltd. | Equipment and storage yards | Negotiation | 2,719,625.46 | 1,819,957.10 |
| Qingdao Wutong Century Supply Chain Co., Ltd. | Buildings and structures | Negotiation | 2,705,626.50 | 2,119,296.03 |
| China Merchants Securities Co., Ltd. | Buildings and structures | Negotiation | 2,697,967.83 | 2,567,514.78 |
| Nanshan Group and its subsidiaries | Buildings and structures | Negotiation | 2,283,922.57 | 5,065,342.55 |
| Yiu Lian Dockyards (Shekou) Limited | Buildings and structures | Negotiation | 2,268,270.47 | 2,195,466.64 |
| Qingdao Sinotrans Logistics Co., Ltd. | Buildings and structures | Negotiation | 2,064,723.80 | - |
| China Merchants Real Estate (Shenzhen) Co., Ltd. | Buildings and structures | Negotiation | - | 7,152,157.00 |
| Other related parties | Buildings and structures, land use rights | Negotiation | 5,928,324.10 | 5,600,826.68 |
| Total | 64,610,732.55 | 66,122,418.38 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 167 -
(XV) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions - continued
(2) Leases with related parties - continued
The Group as the lessee:
CHINA MERCHANTS PORT GROUP CO., LTD.
Name of the lessor
| Name of the lessor | Type of leased assets | Short-term lease expenses or expenses on leases of low-value assets that are accounted for using simplified approach | Variable lease payments that are not included in the measurement of lease liabilities | Rental paid | Interest expenses on lease liabilities | Addition to right-of-use assets | |||||
| 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | ||
| China Merchants Finance Lease (Shanghai) Co., Ltd. | Port and terminal facilities, Machinery and equipment | - | - | - | - | 110,343,653.60 | 116,152,138.56 | 7,734,573.29 | 13,517,478.02 | - | - |
| Nanshan Group | Buildings and structures, Port and terminal facilities, Land use right, Others | 34,242.32 | 28,161.16 | - | - | 69,881,796.93 | 72,311,711.35 | 4,454,094.13 | 7,595,712.33 | - | 9,903,480.08 |
| China Merchants Tongshang Finance Lease Co., Ltd. | Machinery and equipment | - | - | - | - | 46,381,918.54 | 64,099,065.58 | 1,266,294.12 | 3,844,907.71 | - | - |
| China Merchants Finance Lease (Tianjin) Co., Ltd. | Port and terminal facilities | - | - | - | - | 41,997,224.42 | 38,839,274.64 | 4,035,780.92 | 4,986,303.85 | - | - |
China Merchants Shekou Industrial Zone HoldingsCo., Ltd.
| China Merchants Shekou Industrial Zone Holdings Co., Ltd. | Port and terminal facilities, Land use right | - | - | - | - | 36,699,122.62 | 36,699,122.62 | 1,209,619.98 | 3,046,636.47 | 91,911,426.83 | 78,187,153.30 |
| EuroAsia Dockyard Enterprise and Development Limited | Port and terminal facilities | - | - | - | - | 14,908,924.82 | 14,696,367.93 | 446,855.68 | 440,484.85 | 14,462,069.14 | 14,255,883.08 |
| Shenzhen Qianhai Shekou Free Trade Investment Development Co. Ltd. | Port and terminal facilities, Land use right | 7,937,320.80 | 7,892,513.32 | - | - | 8,175,440.38 | 8,175,440.38 | - | - | - | - |
| China Merchants Commercial Property Investment (Shenzhen) Co., Ltd. | Buildings and structures | - | - | - | - | 6,488,599.40 | 6,473,427.40 | 471,603.69 | 181,534.99 | 10,920,656.12 | - |
| Shenzhen Nanyou (Holdings) Ltd. | Land use right | 1,655,096.34 | 1,995,553.15 | - | - | 1,995,553.20 | 1,995,553.15 | - | - | - | - |
| China Merchants International Cold Chain (Shenzhen) Company Limited | Port and terminal facilities | 148,500.00 | 859,290.00 | - | - | 1,893,762.89 | 2,782,367.73 | 32,922.55 | 83,666.10 | - | - |
| Shenzhen Wanhai Building Management Co., Ltd. | Buildings and structures | - | - | - | - | 1,881,947.00 | 1,202,209.02 | 70,805.86 | 106,595.46 | 1,708,272.10 | - |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 168 -
(XV) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions - continued
(2) Leases with related parties - continued
The Group as the lessee: - continued
CHINA MERCHANTS PORT GROUP CO., LTD.
Name of the lessor
| Name of the lessor | Type of leased assets | Short-term lease expenses or expenses on leases of low-value assets that are accounted for using simplified approach | Variable lease payments that are not included in the measurement of lease liabilities | Rental paid | Interest expenses on lease liabilities | Addition to right-of-use assets | |||||
| 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | 2023 | 2022 | ||
| Dalian Bonded Zone Yongdexin Real Estate Development & Construction Co., Ltd. | Buildings and structures | - | - | - | - | 413,854.72 | 408,741.23 | - | - | - | 393,967.46 |
China Merchants Apartment Development(Shenzhen) Co., Ltd.
| China Merchants Apartment Development (Shenzhen) Co., Ltd. | Buildings and structures | 144,662.87 | 142,674.30 | - | - | 142,674.30 | 142,674.30 | - | - | - | - |
| Dalian Port Group Corporation Limited | Buildings and structures | - | - | - | - | 80,000.00 | 80,000.00 | 5,613.75 | 9,766.56 | - | - |
| Dalian Port Communications Engineering Co., Ltd. | Buildings and structures | - | - | - | - | 50,000.00 | 50,000.00 | 8,196.73 | 11,498.73 | - | - |
| Shenzhen Chiwan Haike Industrial Operation Co., Ltd. | Buildings and structures | - | 1,101,345.84 | - | - | - | 1,200,466.97 | - | - | - | ` |
| Qingdao Qianwan United Container Terminal Co., Ltd. | Port and terminal facilities | - | - | - | - | - | 662,285.71 | - | 18,421.02 | - | 1,079,443.53 |
| Total | 9,919,822.33 | 12,019,537.77 | - | - | 341,334,472.82 | 365,970,846.57 | 19,736,360.70 | 33,843,006.09 | 119,002,424.19 | 103,819,927.45 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 169 -
(XV) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions - continued
(3) Related party guarantees
The Group as the guarantor
CHINA MERCHANTS PORT GROUP CO., LTD.
Secured party
| Secured party | Credit line | Guaranteed amount | Commencement date | Maturity | The guarantee has been completed or not |
| 2023 | |||||
| Terminal Link SAS (Note 1) | 76,655,687.32 | 76,655,687.32 | 11 June 2013 | 2033 | No |
| Khor Ambado FZCo (Note 2) | 203,981,760.00 | 156,254,811.86 | 24 May 2019 | 2032 | No |
| Terminal Link SAS (Note 1) | 114,527,259.00 | 114,527,259.00 | 25 Jan 2023 | 2030 | No |
| Total | 395,164,706.32 | 347,437,758.18 | — — | — — | — — |
| 2022 | |||||
| Terminal Link SAS (Note 1) | 66,490,102.62 | 66,490,102.62 | 11 June 2013 | 2033 | No |
| Khor Ambado FZCo (Note 2) | 200,580,480.00 | 120,182,425.59 | 24 May 2019 | 2032 | No |
| Total | 267,070,582.62 | 186,672,528.21 | — — | — — | — — |
Note 1: CMA CGM S.A. is another shareholder of Terminal Link SAS, an associate of the Group.
The Group has made a commitment to CMA CGM S.A. that the Group will provideguarantee for its bank loans and other liabilities to Terminal Link SAS to the extent of theGroup's 49% ownership interest in the company. The actual guaranteed amount is RMB191,182,946.32as at 31 December 2023. If any guarantee liability occurs, the Group willcompensate CMA CGM S.A.
Note 2: Khor Ambado FZCo is a related party of the Group's ultimate controlling shareholder. The
Group provides guarantee for its bank loans and other liabilities, the actual amount ofwhich as at 31 December 2023 is RMB 156,254,811.86.
(4) Borrowings and loans with related parties
| Related party | Amount | Commencement date | Maturity date | Description |
| 2023 | ||||
| Borrowings | ||||
| China Merchants Bank Co., Ltd. | 1,150,941,725.01 | Actual borrowing date | Agreed repayment date | Short-term borrowings |
| China Merchants Group Finance Company Limited | 576,421,628.29 | Actual borrowing date | Agreed repayment date | Long-term borrowings |
| Ocean Driller III Limited | 332,846,013.33 | Actual borrowing date | Agreed repayment date | Other current liabilities |
| China Merchants Group Finance Company Limited | 207,179,377.43 | Actual borrowing date | Agreed repayment date | Short-term borrowings |
| China Merchants Bank Co., Ltd. | 68,062,333.33 | Actual borrowing date | Agreed repayment date | Long-term borrowings |
| Total | 2,335,451,077.39 | — — | — — | — — |
| 2022 | ||||
| Borrowings | ||||
| China Merchants Group Finance Company Limited | 604,990,472.82 | Actual borrowing date | Agreed repayment date | Short-term borrowings |
| China Merchants Bank Co., Ltd. | 140,139,852.77 | Actual borrowing date | Agreed repayment date | Long-term borrowings |
| China Merchants Group Finance Company Limited | 31,618,224.87 | Actual borrowing date | Agreed repayment date | Long-term borrowings |
| China Merchants Bank Co., Ltd. | 15,015,583.33 | Actual borrowing date | Agreed repayment date | Short-term borrowings |
| Total | 791,764,133.79 | — — | — — | — — |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 170 -
(XV) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transactions - continued
(5) Asset transfer from related parties
CHINA MERCHANTS PORT GROUP CO., LTD.
Related party
| Related party | Content of transaction | Pricing method and decision procedures of related transactions | 2023 | 2022 |
| Ningbo Zhoushan | Equity investment | Valuation | 1,845,000,000.00 | - |
| Liaoning Port | Equity investment | Valuation | 83,027,500.00 | - |
| Dalian Port Container | Equity investment | Valuation | 57,083,400.00 | - |
| Jifa Logistics | Equity investment | Valuation | 33,815,300.00 | - |
| Yingkou Port Group | Equity investment | Valuation | 19,002,800.00 | - |
| Hoi Tung (Shanghai) Company Limited | Fixed assets | Negotiation | - | 8,831,858.42 |
| Hoi Tung (Shanghai) Company Limited | Construction in progress | Negotiation | - | 4,853,097.34 |
| Total | — — | — — | 2,037,929,000.00 | 13,684,955.76 |
(6) Compensation for key management personnel
| Item | 2023 | 2022 |
| Compensation for key management personnel | 18,932,731.03 | 20,313,774.52 |
6. Amounts due from/to related parties that have not settled
(1) Amounts due from related parties
| Item | Related party | 31/12/2023 | 31/12/2022 |
| Cash and bank balances | China Merchants Bank Co., Ltd. | 3,778,553,414.06 | 3,387,973,124.59 |
| China Merchants Group Finance Company Limited | 2,090,078,155.93 | 1,841,698,554.32 | |
| Total | 5,868,631,569.99 | 5,229,671,678.91 | |
| Held-for-trading financial assets | China Merchants Bank Co., Ltd. | - | 900,061,111.11 |
| Accounts receivable | Antong Holdings and its subordinate companies | 8,919,131.23 | 8,395,245.04 |
| China Marine Shipping Agency Guangdong Co., Ltd. | 2,765,338.38 | 17,505,768.03 | |
| Sinotrans Container Lines Co., Ltd. | 2,763,240.00 | 1,287,851.75 | |
| Great Horn Development Company FZCo | 2,162,941.76 | 2,157,859.50 | |
| China Ocean Shipping Agency Shenzhen Co. Ltd. | 2,035,495.50 | 758,113.05 | |
| China Merchants International Shipping Agency (Shenzhen) Co., Ltd. | 1,750,277.36 | 1,530,505.68 | |
| Dalian Container Terminal Co., Ltd. | 1,725,150.00 | 1,957,840.00 | |
| COSCO Logistics (Zhanjiang) Co., Ltd. | 1,505,114.97 | 4,045,734.88 | |
| Nanshan Group and its subsidiaries | 1,214,194.85 | 1,404,627.23 | |
| Qingdao Qianwan West Port United Wharf Co., Ltd. | 1,207,750.72 | 3,749,064.99 | |
| Qingdao Qianwan United Container Terminal Co., Ltd. | 1,188,600.01 | 1,729,380.01 | |
| Yiu Lian Dockyards (Shekou) Limited | 1,077,910.40 | 3,554,521.60 | |
| Sinoway Shipping Ltd. | 755,606.02 | 4,564,389.71 | |
| Sinotrans (HK) Shipping Limited | 682,942.44 | 375,748.78 | |
| Liaoning Port | - | 3,680,900.00 | |
| Khor Ambado FZCo | - | 3,108,610.49 | |
| Dalian Jifa Port Logistics Co., Ltd. | - | 2,220,941.63 | |
| Dalian Jifa South Coast International Logistics Co., Ltd. | - | 1,839,478.79 | |
| Liaoning Port Group Co., Ltd. | - | 1,821,581.00 | |
| Port de Djibouti S.A. | - | 1,770,749.55 | |
| South China Sinotrans Supply Chain Management Co., Ltd. | - | 659,854.40 | |
| China Marine Shipping Agency Ningbo Co., Ltd. | - | 164,981.21 | |
| Yingkou Port Group Co., Ltd. and its subsidiaries ("Yingkou Port Group") | - | 160,491.00 | |
| Other related parties | 5,733,746.69 | 13,549,055.64 | |
| Total | 35,487,440.33 | 102,283,282.02 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 171 -
(XV) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
6. Amounts due from/to related parties - continued
(1) Amounts due from related parties - continued
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Related party | 31/12/2023 | 31/12/2022 |
| Dividends receivable | Nanshan Group | 203,577,000.00 | 240,591,000.00 |
| Merchants Port City | 38,809,044.77 | 41,847,044.77 | |
| Dalian Port Logistics Network Co., Ltd. | 30,605,256.76 | - | |
| Yingkou Gangxin Technology Co., Ltd. | 23,881,213.75 | - | |
| Tin-Can Island Container Terminal Ltd | 21,960,680.22 | 65,121,449.40 | |
| COSCO Logistics (Zhanjiang) Co., Ltd. | 13,449,001.16 | 18,449,001.16 | |
| China Ocean Shipping Agency Shenzhen Co. Ltd. | 11,232,000.00 | - | |
| Qingdao Qianwan United Container Terminal Co., Ltd. | - | 50,000,000.00 | |
| Other related parties | - | 232,047.23 | |
| Total | 343,514,196.66 | 416,240,542.56 | |
| Other receivables | Chu Kong River Trade Terminal Co., Ltd. | 36,575,039.20 | 36,053,588.00 |
| Shenzhen Nanyou (Holdings) Ltd. | 30,639,652.92 | 6,725,260.86 | |
| Port de Djibouti S.A. | 24,966,517.50 | 24,808,664.70 | |
| Shenzhen Qianhai Shekou Free Trade Investment Development Co. Ltd. | 6,310,000.00 | 6,310,000.00 | |
| China Merchants Port Investment Development Company Limited | 2,830,188.69 | - | |
| EuroAsia Dockyard Enterprise and Development Limited | 1,531,896.04 | 1,510,055.76 | |
| Tin-Can Island Container Terminal Ltd | 1,320,562.03 | - | |
| Nanshan Group and its subsidiaries | 1,189,566.10 | 1,009,839.70 | |
| China Merchants Commercial Property Investment (Shenzhen) Co., Ltd. | 1,166,408.40 | 1,132,846.40 | |
| Zhoushan Blue Ocean Investment Co., Ltd. | - | 4,996,989.39 | |
| China Merchants Shenzhen Ro-Ro Shipping Co., Ltd. | - | 2,899,163.95 | |
| Other related parties | 2,142,975.51 | 3,550,453.73 | |
| Total | 108,672,806.39 | 88,996,862.49 | |
| Prepayments | Nanshan Group and its subsidiaries | - | 9,000.00 |
| Other related parties | 250,084.22 | 6,351.75 | |
| Total | 250,084.22 | 15,351.75 | |
| Non-current assets due within one year | Terminal Link SAS | 7,468,849.83 | 46,409,214.10 |
| China Merchants Finance Lease (Shanghai) Co., Ltd. | 6,200,000.00 | - | |
| China Merchants Finance Lease (Tianjin) Co., Ltd. | 3,800,000.00 | 3,800,000.00 | |
| Port of Newcastle and its subsidiaries | - | 852,919,208.25 | |
| Total | 17,468,849.83 | 903,128,422.35 | |
| Long-term receivables | Port of Newcastle and its subsidiaries | 921,402,438.00 | - |
| Terminal Link SAS | 204,299,511.52 | 2,931,108,250.96 | |
| Tianjin Haitian Bonded Logistics Co., Ltd. | 34,300,000.00 | 34,300,000.00 | |
| Zhoushan Blue Ocean Investment Co., Ltd. | 4,996,989.39 | - | |
| China Merchants Finance Lease (Tianjin) Co., Ltd. | 695,876.01 | 659,515.88 | |
| China Merchants Finance Lease (Shanghai) Co., Ltd. | - | 6,200,000.00 | |
| Total | 1,165,694,814.92 | 2,972,267,766.84 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 172 -
(XV) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
6. Amounts due from/to related parties - continued
(2) Amounts due to related parties
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Related party | 31/12/2023 | 31/12/2022 |
| Short-term borrowings | China Merchants Bank Co., Ltd. | 1,150,880,891.67 | 15,015,583.33 |
| China Merchants Group Finance Company Limited | 200,176,534.70 | 413,453,629.50 | |
| Total | 1,351,057,426.37 | 428,469,212.83 | |
| Other current liabilities | China Merchants Group Finance Company Limited | - | 10,056,575.34 |
| Accounts payable | Khor Ambado FZCo | 22,639,585.37 | - |
| Antong Holdings and its subordinate companies | 20,360,897.30 | 16,948,161.45 | |
| Dalian Port Logistics Technology Co., Ltd. | 17,607,121.00 | - | |
| Ningbo Zhoushan and its subsidiaries | 14,691,952.29 | 16,725,206.29 | |
| Dalian Port Logistics Network Co., Ltd. | 8,355,644.80 | - | |
| Nanshan Group and its subsidiaries | 5,968,662.37 | 4,259,215.79 | |
| Shenzhen Bay Electricity Industry Co., Ltd. | 5,394,353.74 | 4,920,501.06 | |
| Qingdao Qianwan West Port United Wharf Co., Ltd. | 4,066,438.84 | 8,007,474.16 | |
| China Merchants Port and Shipping Digital Technology (Liaoning) Co., Ltd. | 2,905,000.00 | - | |
| Dalian Ganglong Technology Co., Ltd. | 2,739,450.00 | - | |
| EuroAsia Dockyard Enterprise and Development Limited | 2,413,589.56 | 2,363,408.70 | |
| Shenzhen Merchants to Home Technology Co., Ltd. | 1,781,775.33 | - | |
| China Merchants Port Investment Development Company Limited | 1,649,069.28 | 1,203,536.99 | |
| Yiu Lian Dockyards Limited | 1,135,115.31 | 792,077.94 | |
| Sinoway Shipping Ltd. | - | 4,886,700.00 | |
| China Marine Shipping Agency Shenzhen Co., Ltd. | 259,966.50 | 248,149.17 | |
| Other related parties | 2,761,309.78 | 4,212,603.81 | |
| Total | 100,037,979.18 | 64,567,035.36 | |
| Receipts in advance | China Merchants Port Investment Development Company Limited | 5,358,074.44 | - |
| Qingdao Wutong Century Supply Chain Co., Ltd. | 196,301.30 | 196,301.30 | |
| Other related parties | - | 160,600.00 | |
| Total | 5,554,375.74 | 356,901.30 | |
| Contract liabilities | COSCO Logistics (Zhanjiang) Co., Ltd. | 4,552,313.24 | 1,275,397.28 |
| Qingdao Sinotrans Supply Chain Management Co., Ltd. | 1,464,429.12 | 368,484.60 | |
| China Merchants Port Investment Development Company Limited | 660,943.40 | - | |
| China Ocean Shipping Agency Shenzhen Co. Ltd. | 633,024.00 | - | |
| Shenzhen Baohong Technology Co., Ltd. | 459,049.11 | - | |
| Qingdao Sinotrans Logistics Co., Ltd. | 440,727.56 | - | |
| Dalian Container Terminal Co., Ltd. | - | 9,679,785.44 | |
| Dandong Port Group Co., Ltd. | - | 3,842,709.07 | |
| Qingdao Qianwan United Container Terminal Co., Ltd. | - | 1,556,753.55 | |
| Yingkou Xingang Kuangshi Terminals Co., Ltd. | - | 1,514,844.30 | |
| Antong Holdings and its subordinate companies | - | 1,468,616.91 | |
| Other related parties | 1,021,090.85 | 2,508,480.44 | |
| Total | 9,231,577.28 | 22,215,071.59 | |
| Dividends payable | China Merchants Zhangzhou Development Zone Co., Ltd. | 77,734,806.46 | 20,000,000.00 |
| Dalian Port Container | 16,160,696.61 | 14,000,000.00 | |
| Jifa Logistics | 9,575,104.42 | 3,000,000.00 | |
| Yingkou Port Group | 5,372,456.78 | - | |
| Yiu Lian Dockyards Limited | 2,334,150.00 | - | |
| Zhanjiang Infrastructure Construction Investment Group Co., Ltd. | - | 41,400,234.06 | |
| Sri Lanka Ports Authority | - | 10,446,900.00 | |
| Total | 111,177,214.27 | 88,847,134.06 | |
| Other payables | Lac Assal Investment Holding Company Limited | 64,310,900.95 | 47,359,371.46 |
| Terminal Link SAS | 10,423,425.44 | - | |
| China Merchants Real Estate (Shenzhen) Co., Ltd. | 10,079,369.00 | 10,079,369.00 | |
| China Merchants Commercial Property Investment (Shenzhen) Co., Ltd. | 5,000,000.03 | 3,750,000.03 | |
| Antong Holdings and its subordinate companies | 4,743,266.37 | 12,730,734.37 | |
| Sinotrans Shenzhen Qianhai Supply Chain Management Ltd. | 1,690,130.78 | 1,628,515.12 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 173 -
(XV) RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
6. Amounts due from/to related parties - continued
(2) Amounts due to related parties - continued
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Related party | 31/12/2023 | 31/12/2022 |
| Other payables | China Merchant Food (China) Co., Ltd. | 1,069,017.00 | 1,069,017.00 |
| China Traffic Import and Export Co., Ltd. | 1,055,975.76 | - | |
| Hoi Tung (Shanghai) Company Limited | 966,785.34 | - | |
| China Merchants International Cold Chain (Shenzhen) Company Limited | 757,976.00 | - | |
| Shenzhen Baohong Technology Co., Ltd. | 749,269.39 | 749,269.39 | |
| China Merchants Shekou Industrial Zone Holdings Co., Ltd. | - | 6,420,820.68 | |
| China Merchants Port Investment Development Company Limited | - | 4,130,081.82 | |
| China Merchants Real Estate Co., Ltd. | - | 3,263,853.86 | |
| Zhanjiang Xiagang United Development Co., Ltd. | - | 1,439,753.57 | |
| Other related parties | 6,946,931.01 | 6,732,058.14 | |
| Total | 107,793,047.07 | 99,352,844.44 | |
| Non-current liabilities due within one year | China Merchants Group Finance Company Limited | 288,071,994.22 | 110,838,087.45 |
| China Merchants Bank Co., Ltd. | 199,326,195.84 | 11,362,639.43 | |
| China Merchants Finance Lease (Shanghai) Co., Ltd. | 76,461,173.65 | 103,236,707.51 | |
| Nanshan Group and its subsidiaries | 63,331,699.85 | 65,165,836.97 | |
| China Merchants Shekou Industrial Zone Holdings Co., Ltd. | 35,719,107.95 | 37,012,422.69 | |
| China Merchants Finance Lease (Tianjin) Co., Ltd. | 7,548,329.72 | 32,339,542.44 | |
| China Merchants Commercial Property Investment (Shenzhen) Co., Ltd. | 6,396,788.04 | - | |
| China Merchants International Cold Chain (Shenzhen) Company Limited | 375,528.56 | 1,050,270.17 | |
| China Merchants Tongshang Finance Lease Co., Ltd. | - | 45,115,824.42 | |
| EuroAsia Dockyard Enterprise and Development Limited | - | 14,255,883.08 | |
| Guangdong Shunkong City Investment Real Estate Co. Ltd. | - | 3,162,000.00 | |
| Other related parties | - | 1,962,815.09 | |
| Total | 677,230,817.83 | 425,502,029.25 | |
| Long-term borrowings | China Merchants Group Finance Company Limited | 721,624,592.13 | 445,490,692.58 |
| China Merchants Bank Co., Ltd. | 158,000,000.00 | 325,000,000.00 | |
| Total | 879,624,592.13 | 770,490,692.58 | |
| Lease liabilities | China Merchants Shekou Industrial Zone Holdings Co., Ltd. | 62,185,360.58 | 5,993,041.70 |
| China Merchants Finance Lease (Shanghai) Co., Ltd. | - | 75,833,546.45 | |
| Nanshan Group and its subsidiaries | - | 65,431,073.09 | |
| China Merchants Finance Lease (Tianjin) Co., Ltd. | - | 15,833,403.29 | |
| China Merchants International Cold Chain (Shenzhen) Company Limited | - | 253,362.41 | |
| Other related parties | 1,070,904.61 | 803,148.25 | |
| Total | 63,256,265.19 | 164,147,575.19 | |
| Long-term payables | China Merchants Finance Lease (Tianjin) Co., Ltd. | 33,905,690.32 | 41,052,268.30 |
(XVI) SHARE-BASED PAYMENTS
1. Equity instruments
| Type of targets granted | Granted in the current year | Exercised in the current year | Unlocked in the current year | Lapsed in the current year | ||||
| Qty. | Amount | Qty. | Amount | Qty. | Amount | Qty. | Amount | |
| Management | - | - | - | - | - | - | 354,720 | 1,129,997.09 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 174 -
(XVI) SHARE-BASED PAYMENTS - continued
1. Equity instruments - continued
Outstanding stock option or other equity instruments at the end of current year
CHINA MERCHANTS PORT GROUP CO., LTD.
Type of targets granted
| Type of targets granted | Outstanding stock option at the end of current year | |
| Range of exercise prices | Remaining term of contract | |
| Management | RMB 14.28 to RMB 16.53 | 37 months |
2. Equity-settled share-based payments
| The method used to determine the fair value of equity instruments at the grant date | The cost of granted stock options was estimated using the Black Scholes Model. |
| The basis for determining the number of exercisable equity instruments | At each balance sheet date in the vesting period, the best estimate was made and the estimated number of exercisable equity instruments was modified according to the latest changes in the number of employees who can exercise the rights and other subsequent information. |
| Reasons for the significant difference between the estimates of the current year and the estimates of prior year | Criteria of exercising in vesting period of batch 1 and batch 2 are not satisfied |
| The aggregate amount of equity-settled share-based payments that is included in capital reserve | 6,644,590.36 |
Pursuant to the Official Reply on the Implementation of the Stock Option Incentive Plan of ChinaMerchants Port Group Co., Ltd. by State-owned Assets Supervision and AdministrationCommission of the State Council (No. 748 [2019], SASAC), which was deliberated and approvedby the 1
st
Extraordinary General Meeting of the Company in 2020 on 3 February 2020, the Companyimplemented a stock option plan with effect from 3 February 2020 to grant 238 incentive recipients17,198,000 stock options with an exercise price of RMB17.80 per share. With a lockup period of24 months from the grant date, the stock options are exercisable upon expiry of the 24-month lockupperiod in the premise that the vesting conditions are satisfied. The stock options are exercisable inthree batches, specifically, 40% for the first batch (after 24 months but within 36 months subsequentto the grant date), 30% for the second batch (after 36 months but within 48 months subsequent tothe grant date) and the remaining 30% for the third batch (after 48 months but within 84 monthssubsequent to the grant date). Each stock option entitles the holder to subscribe for one ordinaryshare of the Company.
On 5 March 2021, the granting of stock option (reserved portion) under stock option inventive plan(phase I) was completed. The reserved portion of stock option targets to total 3 persons, granting530,000 shares of stock option with exercise price of RMB15.09 per share. The grant date is 29January 2021. With a lockup period of 24 months from the grant date, the stock options areexercisable upon expiry of the 24-month lockup period in the premise that the vesting conditionsare satisfied. The stock options are exercisable in two batches, specifically, 50% for the first batch(after 24 months but within 36 months subsequent to the grant date), and the remaining 50% for thesecond batch (after 36 months but within 72 months subsequent to the grant date). Each stock optionentitles the holder to subscribe for one ordinary share of the Company.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 175 -
(XVI) SHARE-BASED PAYMENTS - continued
2. Equity-settled share-based payments - continued
According to Article 32 of Stock Option Incentive Plan, since the grant date of the stock option, ifthe Company distributes dividends prior to the exercise of the option, the exercise price shall beadjusted accordingly. Therefore, the Company uniformly adjusted the exercise price fromRMB17.80 per share to 17.34 per share in respect of the first batch of stock option granted underthe stock option incentive plan (phase I) on 30 January 2021; the Company uniformly adjusted theexercise price from RMB 17.34 per share to 16.96 per share in respect of the first batch of stockoption granted under the stock option incentive plan (phase I), and the exercise price of the reservedportion of stock option from RMB 15.09 per share to 14.71 per share on 29 January 2022; theCompany uniformly adjusted the exercise price from RMB 16.96 per share to 16.53 per share inrespect of the first batch of stock option granted under the stock option incentive plan (phase I), andthe exercise price of the reserved portion of stock option from RMB 14.71 per share to 14.28 pershare on 20 January 2023.
As at the date on which the financial statements are issued, as 12 of the incentive targets for the firstbatch of stock option granted under the stock option incentive plan (phase I) have retired or nolonger serve the Company, the board of directors of the Company decided to cancel in total of339,600 shares of stock option granted but not yet exercised by such persons; as 5 of the incentivetargets for the third vesting period of the stock option (1
stbatch) under the stock option incentiveplan (phase I) of the Company have not satisfied the criteria of exercise in their performanceassessment, the Company has cancelled the 20% of the stock option (totalling 15,120 shares) forthe third vesting period of the stock option (1
stbatch) under the stock option incentive plan (phaseI) held by the 5 incentive targets.
As at the date on which the financial statements are issued, 195 incentive targets who can exercisethe rights for the third vesting period of the stock option (1
st
batch) under the stock option incentiveplan (phase I) included: (1) 190 incentive targets who met the designated grades in the performanceassessment, holding 100% of the stock option (totalling 3,471,600 shares) for the third vestingperiod of the stock option (1
stbatch) under the stock option incentive plan (phase I) of the Companyand satisfying the criteria of exercise; and (2) 5 incentive targets who met the designated grades inthe performance assessment, holding 80% of the stock option (totalling 60,480 shares) for the thirdvesting period of the stock option (1
stbatch) under the stock option incentive plan (phase I) of theCompany and satisfying the criteria of exercise. The second vesting period of the stock option(reserved portion) under the stock option incentive plan (phase I) targets to total 3 persons who canexercise the rights. The 3 incentive targets have met the designated grades in the performanceassessment, and 100% of stock option for the second vesting period of the stock option (reservedportion) under the stock option incentive plan (phase I) of the Company held by them have satisfiedthe criteria of exercise, granting 265,000 shares of exercisable stock option for the second vestingperiod of the stock option (reserved portion) under the stock option incentive plan (phase I).
3. Share-based payment expenses in the current year
CHINA MERCHANTS PORT GROUP CO., LTD.Type of targets granted
| Type of targets granted | Equity-settled share-based payment expenses |
| Management | 4,016,693.76 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 176 -
(XVII) COMMITMENTS AND CONTINGENCIES
1. Significant commitments
CHINA MERCHANTS PORT GROUP CO., LTD.Item
| Item | 31/12/2023 | 31/12/2022 |
| Commitments that have been entered into but have not been recognized in the financial statements | ||
| - Commitment to make contributions to the investees | 467,604,906.76 | 38,956,185.01 |
| - Commitment to acquire and construct long-term assets | 2,407,538,867.35 | 1,802,316,899.52 |
| - Commitment to invest port construction | - | 5,571,690.76 |
| - Others | - | 383,560.31 |
| Total | 2,875,143,774.11 | 1,847,228,335.60 |
2. Contingencies
| Item | 31/12/2023 | 31/12/2022 |
| Contingent liabilities brought by external litigations (Note 1) | 946,218,359.48 | 279,438,527.06 |
| Guarantee for borrowings of related parties (Note 2) | 347,437,758.18 | 186,672,528.21 |
| Total | 1,293,656,117.66 | 466,111,055.27 |
Note 1: This mainly represents the significant contingent liabilities arising from the litigations
between TCP and its subsidiaries and local tax authority, employee or former employeeof TCP and its subsidiaries in Brazil at as the year end. According to the latest estimatesof the Group's management, the possible compensation is RMB 946,218,359.48 but it isnot likely to cause outflow of economic benefits from the Group. Therefore, the contingentliabilities arising from the above pending litigations are not recognized as provisions. Thecounter-bonification where the Group as the beneficiary will be executed by the formerTCP shareholder that disposed the shares. According to the counter-bonificationagreement, the former TCP shareholder needs to make counter-bonification to the Groupin respect of the above contingent liabilities, with the compensation amount not exceedingpre-determined amount and specified period.
Zhanjiang Port, a subsidiary of the Company, entered into an EPC contract for the GeneralCargo Terminal Project at Donghai Island Port Area of Zhanjiang Port with CCCC WaterTransport Planning and Design Institute Co., Ltd. on 28 June 2016, with the agreedconstruction period from 28 June 2016 to 8 June 2018. After the contract was signed, theoverall progress of the project construction was delayed due to the optimization andadjustment of the layout plan and process design for the terminal. In December 2022,CCCC Water Transport Planning and Design Institute Co., Ltd. filed a litigation to thecourt for losses caused by delay in construction, adjustment to project scale, changes indesign, and other reasons, and may require the Zhanjiang Port for compensation.
The claims of CCCC Water Transport Planning and Design Institute Co., Ltd. wereinconsistent with those agreed in the contract, the relevant result of the litigation could notbe reasonably estimated, and the management of the Company believed that the possibilityof loss was quite low, therefore, no provisions were made for the above pending litigation.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 177 -
(XVII) COMMITMENTS AND CONTINGENCIES - continued
2. Contingencies - continued
Note 2: As at 31 December 2023, the guarantees provided by the Group for related parties are
detailed in Note XV 5(3).
As at 31 December 2023, the directors of the Company evaluated the default risks ofrelated companies on the above-mentioned loan financing and other liabilities, andbelieved that the risks were not significant and the possibility of guaranteed payments wasvery small.
Except for the above-mentioned contingencies, as at 31 December 2023, the Group had no othermajor guarantees and other contingencies that need to be explained.
(XVIII)EVENTS AFTER THE BALANCE SHEET
According to the profit distribution plan for 2023 and as approved by the 7th meeting of the 10thboard of directors on 29 March 2024, the Company, based on the total shares of 2,499,074,661 asat 31 December 2023, distributes cash dividends at RMB 5.80(inclusive of tax) for every 10 shares,totalling RMB 1,449,463,303.38. The above profit distribution plan has not yet been approved byshareholders' meeting.
(XIX) OTHER SIGNIFICANT EVENTS
1. Segment reporting
(1) Basis for determining reporting segments and accounting policies
The key management team of the Company is regarded as the CODM, who reviews the Group'sinternal reports in order to assess performance, allocate resources and determine the operatingsegments. The CODM considers the operation of the Group in terms of business and locations.
Individual operating segments for which discrete financial information is available are identifiedby the CODM and are operated by their respective management teams. These individual operatingsegments are aggregated in arriving at the reporting segments of the Group.
From business and location perspectives, the management assesses the performance of the Group'sbusiness operations including ports operation, bonded logistics operation and other operations.
Ports operation
Ports operation includes container terminal operation, bulk and general cargo terminal operationoperated by the Group and its associates and joint ventures.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(XIX) OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(1) Basis for determining reporting segments and accounting policies - continued
Ports operation - continued
The Group's ports operation is presented as follows:
(a) Mainland China, Hong Kong and Taiwan
? Pearl River Delta? Yangtze River Delta? Bohai Rim? Others
(b) Other locations outside of Mainland China, Hong Kong and Taiwan
Bonded logistics operation
Bonded logistics operation includes logistics park operation, ports transportation and airport cargohandling operated by the Group and its associates and joint ventures.
Other operations
Other operations mainly include property development and investment and logistics businessoperated by the Group's associates, property investment operated by the Group and corporatefunction.
Each of the segments under ports operation includes the operations of a number of ports in variouslocations within one geographic location. For the purpose of segment reporting, these individualoperating segments have been aggregated into reportable segments on geographic basis in order topresent a more systematic and structured segment information. To give details of each of theoperating segments, in the opinion of the directors of the Company, would result in particulars ofexcessive length.
Bonded logistics operation and other operations include a number of different operations, each ofwhich is considered as a separate but insignificant operating segment by the CODM. For segmentreporting, these individual operating segments have been aggregated according to the nature of theiroperations to give rise to more meaningful presentation.
There are no material sales or other transactions between the segments.
The revenue from a major customer of ports operation amounts to RMB 2,007,111,746.88,representing 12.74% (2022: 10.30%) of the Group's operating income for 2023.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(XIX) OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(2) Financial information of reporting segments
Segment financial information for 2023 is as follows:
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Ports operation | Bonded logistics operation | Others | Unappropriated amount | Total | |||||
| Mainland China, Hong Kong and Taiwan | Other locations | Sub-total | ||||||||
| Pearl River Delta | Yangtze River Delta | Bohai Rim | Others | |||||||
| Operating income | 6,075,691,801.01 | 557,788,311.93 | 76,760,801.96 | 3,574,402,653.20 | 4,751,630,018.56 | 15,036,273,586.66 | 532,670,444.04 | 181,531,749.52 | - | 15,750,475,780.22 |
| Operating cost | 3,640,281,453.34 | 361,926,675.75 | 63,825,074.56 | 2,648,882,080.97 | 2,081,165,945.51 | 8,796,081,230.13 | 289,816,313.93 | 232,289,163.69 | - | 9,318,186,707.75 |
| Segment operating profit (Losses are marked with "-") | 2,435,410,347.67 | 195,861,636.18 | 12,935,727.40 | 925,520,572.23 | 2,670,464,073.05 | 6,240,192,356.53 | 242,854,130.11 | -50,757,414.17 | - | 6,432,289,072.47 |
| Taxes and surcharges | 36,973,822.23 | 2,937,337.05 | 1,126,391.13 | 45,970,219.08 | 174,670,480.72 | 261,678,250.21 | 26,757,765.42 | 24,332,840.83 | 229,169.73 | 312,998,026.19 |
| Administrative expense | 437,814,344.01 | 26,162,000.70 | 9,644,685.03 | 529,927,581.34 | 289,653,304.36 | 1,293,201,915.44 | 49,569,679.55 | 1,111,358.13 | 432,758,202.26 | 1,776,641,155.38 |
| R&D expenses | 176,892,569.73 | 23,890,344.38 | - | 22,956,157.96 | - | 223,739,072.07 | - | - | - | 223,739,072.07 |
| Financial expenses | 57,700,690.44 | 20,953,099.98 | 1,883,921.89 | 85,621,075.66 | 55,969,633.29 | 222,128,421.26 | 3,129,354.57 | 20,854,412.74 | 1,593,001,139.57 | 1,839,113,328.14 |
| Other income | 148,491,604.96 | 10,227,298.67 | 203,918.26 | 50,512,014.48 | - | 209,434,836.37 | 14,668,272.54 | 286,151.86 | - | 224,389,260.77 |
| Investment income | 130,131,600.03 | 4,956,167,513.13 | 416,731,511.24 | 50,706,320.64 | 454,900,989.67 | 6,008,637,934.71 | 59,521,957.15 | 245,264,989.05 | 35,252,059.89 | 6,348,676,940.80 |
| Gains from changes (Losses are marked with "-") in fair value | 102,777,832.55 | -58,125,015.24 | 80,543,109.95 | -6,584,009.33 | - | 118,611,917.93 | -57,875,873.69 | 9,644,865.10 | 2,971,891.18 | 73,352,800.52 |
| Gains from impairment of credit (Losses are marked with "-") | 7,327,814.78 | -36,129.03 | - | 3,468,262.80 | -7,171,766.68 | 3,588,181.87 | 33,695,859.31 | - | - | 37,284,041.18 |
| Gains from impairment of assets (Losses are marked with "-") | -1,091,994.67 | -189,030,229.12 | - | - | -1,175,087.49 | -191,297,311.28 | - | - | - | -191,297,311.28 |
| Gains from disposal of assets (Losses are marked with "-") | 6,196,256.45 | - | -7,362.22 | 34,965,994.86 | 507,804.31 | 41,662,693.40 | -602,074.20 | -4,253,879.72 | -47,206.87 | 36,759,532.61 |
| Operating profit (Losses are marked with "-") | 2,119,862,035.36 | 4,841,122,292.48 | 497,751,906.58 | 374,114,121.64 | 2,597,232,594.49 | 10,430,082,950.55 | 212,805,471.68 | 153,886,100.42 | -1,987,811,767.36 | 8,808,962,755.29 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(XIX) OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(2) Financial information of reporting segments - continued
Segment financial information for 2023 is as follows: - continued
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Ports operation | Bonded logistics operation | Others | Unappropriated amount | Total | |||||
| Mainland China, Hong Kong and Taiwan | Other locations | Sub-total | ||||||||
| Pearl River Delta | Yangtze River Delta | Bohai Rim | Others | |||||||
| Non-operating income | 30,640,040.33 | 206,852.93 | 541,008.01 | 8,475,666.30 | 41,553,418.13 | 81,416,985.70 | 151,072.00 | 397,901.93 | 5,336,064.49 | 87,302,024.12 |
| Non-operating expenses | 7,067,285.26 | 269,926.28 | 89,933.45 | 20,553,447.08 | 59,763,043.59 | 87,743,635.66 | 323,424.06 | - | 9,005,781.00 | 97,072,840.72 |
| Total profit (Losses are marked with "-") | 2,143,434,790.43 | 4,841,059,219.13 | 498,202,981.14 | 362,036,340.86 | 2,579,022,969.03 | 10,423,756,300.59 | 212,633,119.62 | 154,284,002.35 | -1,991,481,483.87 | 8,799,191,938.69 |
| Income tax expenses | 496,377,795.59 | 258,020,898.94 | 44,218,770.18 | 58,080,621.40 | 383,193,406.85 | 1,239,891,492.96 | 35,421,490.70 | 27,848,029.46 | 418,839.81 | 1,303,579,852.93 |
| Net profit (Losses are marked with "-") | 1,647,056,994.84 | 4,583,038,320.19 | 453,984,210.96 | 303,955,719.46 | 2,195,829,562.18 | 9,183,864,807.63 | 177,211,628.92 | 126,435,972.89 | -1,991,900,323.68 | 7,495,612,085.76 |
| Segment assets | 23,724,145,365.09 | 57,709,896,939.07 | 9,703,687,046.02 | 27,727,348,979.52 | 42,500,927,378.99 | 161,366,005,708.69 | 4,712,961,257.31 | 19,403,999,499.27 | 13,074,330,201.99 | 198,557,296,667.26 |
| Total assets in the financial statements | 198,557,296,667.26 | |||||||||
| Segment liabilities | 7,029,170,965.33 | 1,275,695,327.99 | 158,452,621.02 | 6,498,242,286.20 | 7,189,272,994.18 | 22,150,834,194.72 | 540,614,061.66 | 617,809,748.89 | 49,678,104,233.18 | 72,987,362,238.45 |
| Total liabilities in the financial statements | 72,987,362,238.45 | |||||||||
| Supplementary information: | ||||||||||
| Depreciation and amortization | 1,126,510,216.09 | 113,947,562.11 | 882,064.68 | 875,850,774.90 | 866,605,229.04 | 2,983,795,846.82 | 102,034,394.34 | 194,738,423.53 | 23,167,239.73 | 3,303,735,904.42 |
| Interest income | 42,679,230.74 | 2,243,451.14 | 714,733.07 | 22,543,238.68 | 256,085,052.61 | 324,265,706.24 | 7,210,199.57 | 1,678,151.13 | 164,439,864.42 | 497,593,921.36 |
| Interest expense | 90,781,497.89 | 10,849,293.26 | - | 107,297,773.92 | 314,310,921.43 | 523,239,486.50 | 8,495,591.27 | 19,075,433.27 | 1,687,342,285.62 | 2,238,152,796.66 |
| Investment income from long-term equity investments under equity method | 44,963,451.52 | 4,750,830,911.12 | 375,529,615.82 | 47,995,671.63 | 454,900,989.67 | 5,674,220,639.76 | 59,521,957.15 | 245,264,989.05 | - | 5,979,007,585.96 |
| Long-term equity investments under equity method | 1,764,751,439.03 | 55,844,039,253.08 | 8,777,428,828.42 | 1,715,660,813.08 | 12,507,306,667.48 | 80,609,187,001.09 | 1,756,185,613.17 | 14,300,745,162.01 | - | 96,666,117,776.27 |
| Non-current assets other than long-term equity investments | 18,193,324,391.19 | 398,488,128.16 | 14,938,012.93 | 20,908,386,344.60 | 26,031,938,950.63 | 65,547,075,827.51 | 2,381,793,244.49 | 4,753,153,217.29 | 419,380,677.78 | 73,101,402,967.07 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(XIX) OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(2) Financial information of reporting segments - continued
Segment financial information for 2022 is as follows:
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Ports operation | Bonded logistics operation | Others | Unappropriated amount (Restated) | Total (Restated) | |||||
| Mainland China, Hong Kong and Taiwan | Other locations | Sub-total | ||||||||
| Pearl River Delta | Yangtze River Delta | Bohai Rim | Others | |||||||
| Operating income | 6,774,045,422.66 | 1,139,944,516.62 | 74,222,857.10 | 3,552,074,625.60 | 4,086,514,642.86 | 15,626,802,064.84 | 445,592,537.09 | 158,094,525.62 | - | 16,230,489,127.55 |
| Operating cost | 3,849,914,782.32 | 696,788,162.45 | 62,264,300.65 | 2,691,172,225.32 | 1,853,376,921.16 | 9,153,516,391.90 | 280,270,213.56 | 216,675,107.48 | - | 9,650,461,712.94 |
| Segment operating profit (Losses are marked with "-") | 2,924,130,640.34 | 443,156,354.17 | 11,958,556.45 | 860,902,400.28 | 2,233,137,721.70 | 6,473,285,672.94 | 165,322,323.53 | -58,580,581.86 | - | 6,580,027,414.61 |
| Taxes and surcharges | 32,239,840.06 | 5,674,557.52 | 1,102,665.95 | 49,561,307.23 | 152,923,436.63 | 241,501,807.39 | 22,188,514.91 | 18,305,796.73 | 253,354.43 | 282,249,473.46 |
| Administrative expense | 435,544,849.33 | 37,586,936.77 | 9,903,393.91 | 536,045,336.65 | 266,594,657.88 | 1,285,675,174.54 | 46,846,479.95 | 1,356,901.51 | 431,216,180.51 | 1,765,094,736.51 |
| R&D expenses | 227,962,954.81 | 40,790,798.38 | - | 18,952,425.51 | - | 287,706,178.70 | - | - | - | 287,706,178.70 |
| Financial expenses | 43,042,474.05 | 12,623,313.35 | 16,617,530.89 | 105,755,359.90 | 202,779,070.53 | 380,817,748.72 | 11,831,333.17 | 42,509,881.22 | 1,823,554,709.31 | 2,258,713,672.42 |
| Other income | 128,422,018.54 | 6,905,602.77 | 99,278.36 | 73,123,957.51 | - | 208,550,857.18 | 20,996,809.22 | 2,259,661.58 | 9,840,742.44 | 241,648,070.42 |
| Investment income | 222,543,823.37 | 5,152,876,665.17 | 334,188,303.02 | 53,824,558.05 | 1,070,198,985.49 | 6,833,632,335.10 | 94,330,245.64 | 425,089,497.20 | 24,603,428.39 | 7,377,655,506.33 |
| Gains from changes in fair value (Losses are marked with "-") | 34,481,879.58 | - | -28,084,576.60 | 1,009,908.14 | - | 7,407,211.12 | -136,440,861.23 | - | - | -129,033,650.11 |
| Gains from impairment of credit (Losses are marked with "-") | -5,932,959.08 | - | 269,053.38 | 19,276,798.42 | -221,119,087.29 | -207,506,194.57 | -15,967,381.98 | - | - | -223,473,576.55 |
| Gains from impairment of assets (Losses are marked with "-") | -573,122.05 | - | - | -21,585,898.15 | - | -22,159,020.20 | - | - | - | -22,159,020.20 |
| Gains from disposal of assets (Losses are marked with "-") | -186,834.36 | - | - | -2,189,571.61 | 61,495.66 | -2,314,910.31 | 104,763.84 | 57,352,755.05 | -12,513.06 | 55,130,095.52 |
| Operating profit (Losses are marked with "-") | 2,564,095,328.09 | 5,506,263,016.09 | 290,807,023.86 | 274,047,723.35 | 2,459,981,950.52 | 11,095,195,041.91 | 47,479,570.99 | 363,948,752.51 | -2,220,592,586.48 | 9,286,030,778.93 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(XIX) OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(2) Financial information of reporting segments - continued
Segment financial information for 2022 is as follows: - continued
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Ports operation | Bonded logistics operation | Others | Unappropriated amount (Restated) | Total (Restated) | |||||
| Mainland China, Hong Kong and Taiwan | Other locations | Sub-total | ||||||||
| Pearl River Delta | Yangtze River Delta | Bohai Rim | Others | |||||||
| Non-operating income | 18,342,596.09 | 2,900,356.17 | 22,378,312.31 | 10,237,915.83 | 221,044,827.94 | 274,904,008.34 | 50,933.02 | 992,336.45 | 3,327,174.96 | 279,274,452.77 |
| Non-operating expenses | 23,387,870.39 | 1,035,713.16 | - | 148,923,783.29 | 29,888,387.79 | 203,235,754.63 | 10,000.00 | - | 17,196,500.05 | 220,442,254.68 |
| Total profit (Losses are marked with "-") | 2,559,050,053.79 | 5,508,127,659.10 | 313,185,336.17 | 135,361,855.89 | 2,651,138,390.67 | 11,166,863,295.62 | 47,520,504.01 | 364,941,088.96 | -2,234,461,911.57 | 9,344,862,977.02 |
| Income tax expenses | 517,928,967.15 | 218,235,972.45 | 19,104,784.49 | 39,483,784.58 | 224,820,817.17 | 1,019,574,325.84 | 17,884,281.49 | 73,694,575.33 | 1,806,494.09 | 1,112,959,676.75 |
| Net profit (Losses are marked with "-") | 2,041,121,086.64 | 5,289,891,686.65 | 294,080,551.68 | 95,878,071.31 | 2,426,317,573.50 | 10,147,288,969.78 | 29,636,222.52 | 291,246,513.63 | -2,236,268,405.66 | 8,231,903,300.27 |
| Segment assets | 24,260,000,005.96 | 58,080,072,708.01 | 9,491,073,768.13 | 27,095,782,491.19 | 44,382,357,967.93 | 163,309,286,941.22 | 4,719,222,985.06 | 19,523,260,761.95 | 10,035,331,759.08 | 197,587,102,447.31 |
| Total assets in the financial statements | 197,587,102,447.31 | |||||||||
| Segment liabilities | 10,545,067,732.35 | 1,993,414,192.41 | 142,428,100.05 | 7,095,951,456.64 | 7,184,350,827.79 | 26,961,212,309.24 | 472,931,692.54 | 849,543,150.07 | 40,981,807,066.15 | 69,265,494,218.00 |
| Total liabilities in the financial statements | 69,265,494,218.00 | |||||||||
| Supplementary information: | ||||||||||
| Depreciation and amortization | 1,119,781,238.27 | 214,719,968.82 | 882,688.51 | 851,694,182.33 | 801,221,249.28 | 2,988,299,327.21 | 98,440,779.50 | 184,744,488.91 | 26,022,221.27 | 3,297,506,816.89 |
| Interest income | 49,428,469.37 | 2,890,732.29 | 543,508.80 | 27,921,113.89 | 255,001,470.66 | 335,785,295.01 | 1,231,657.13 | 1,329,524.29 | 131,487,621.62 | 469,834,098.05 |
| Interest expense | 86,468,640.13 | 10,921,214.61 | - | 128,204,357.08 | 415,728,796.45 | 641,323,008.27 | 13,108,859.14 | 26,701,866.03 | 1,544,029,072.35 | 2,225,162,805.79 |
| Investment income from long-term equity investments under equity method | 134,882,198.77 | 5,114,173,074.83 | 293,371,940.22 | 53,436,206.60 | 1,070,198,985.49 | 6,666,062,405.91 | 94,330,245.64 | 424,789,497.20 | - | 7,185,182,148.75 |
| Long-term equity investments under equity method | 1,741,189,123.54 | 52,146,528,746.22 | 8,605,621,312.90 | 1,094,348,450.19 | 13,193,855,158.62 | 76,781,542,791.47 | 1,496,017,782.58 | 14,086,733,345.00 | - | 92,364,293,919.05 |
| Non-current assets other than long-term equity investments | 18,338,841,436.04 | 4,203,682,076.56 | 15,863,803.61 | 21,159,269,860.52 | 25,053,023,827.83 | 68,770,681,004.56 | 2,058,218,100.73 | 5,083,564,521.74 | 880,089,692.55 | 76,792,553,319.58 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(XIX) OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(2) Financial information of reporting segments - continued
The Group's total revenue from external transactions in Mainland China and other countries andregions, and total non-current assets other than financial assets and deferred tax assets located inMainland China and other countries and regions are presented as follows:
CHINA MERCHANTS PORT GROUP CO., LTD.Revenue from external transactions
| Revenue from external transactions | 2023 | 2022 |
| Mainland China, Hong Kong and Taiwan | 10,958,608,605.93 | 12,105,380,701.20 |
| Pearl River Delta | 6,600,817,552.32 | 7,195,529,214.88 |
| Yangtze River Delta | 557,788,311.93 | 1,139,944,516.62 |
| Bohai Rim | 225,600,088.48 | 217,832,344.10 |
| Others | 3,574,402,653.20 | 3,552,074,625.60 |
| Other locations | 4,791,867,174.29 | 4,125,108,426.35 |
| Total | 15,750,475,780.22 | 16,230,489,127.55 |
| Total non-current assets | 31/12/2023 | 31/12/2022 |
| Mainland China, Hong Kong and Taiwan | 128,859,143,257.19 | 130,723,044,577.52 |
| Pearl River Delta | 40,390,524,565.51 | 42,150,053,552.57 |
| Yangtze River Delta | 56,242,527,381.24 | 56,350,210,822.78 |
| Bohai Rim | 9,297,697,381.31 | 9,147,542,234.74 |
| Others | 22,928,393,929.13 | 23,075,237,967.43 |
| Other locations | 40,908,377,486.15 | 38,433,802,661.11 |
| Total | 169,767,520,743.34 | 169,156,847,238.63 |
(3) Degree of reliance on major customers
The total operating income derived from the top five customers of the Group is RMB4,146,867,314.45, accounting for 26.33% of the Group's operating income.
(XX)NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS
1. Other receivables
1.1 Summary of other receivables
| Item | 31/12/2023 | 31/12/2022 |
| Dividends receivable | 167,092,526.14 | 147,896,763.88 |
| Other receivables | 1,575,369,144.18 | 2,601,740,991.35 |
| Total | 1,742,461,670.32 | 2,749,637,755.23 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(XX)NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS- continued
1. Other receivables - continued
1.2 Dividends receivable
(1) Presentation of dividends receivable
CHINA MERCHANTS PORT GROUP CO., LTD.Investee
| Investee | 31/12/2023 | 31/12/2022 |
| Wharf Holdings Hong Kong | 147,680,363.88 | 147,680,363.88 |
| CM International Tech | 4,758,668.03 | - |
| Chiwan Shipping (Hong Kong) Limited | 3,205,094.23 | - |
| Shenzhen Petrochemical Industry (Group) Co., Ltd. | 216,400.00 | 216,400.00 |
| China Ocean Shipping Agency (Shenzhen) Co., Ltd. | 11,232,000.00 | - |
| Total | 167,092,526.14 | 147,896,763.88 |
| Less: Provision for credit loss | - | - |
| Carrying amount | 167,092,526.14 | 147,896,763.88 |
(2) Significant dividends receivable aged more than 1 year
| Item | 31/12/2023 | 31/12/2022 | Reason for outstanding | Impaired or not and the determination basis |
| Wharf Holdings Hong Kong | 147,680,363.88 | 147,680,363.88 | In processing and expected to be recovered in 2024 | No |
| Total | 147,680,363.88 | 147,680,363.88 |
1.3 Other receivables
(1) Aging analysis of other receivables
| Aging | 31/12/2023 | ||
| Other receivables | Provision for credit loss | Proportion of provision (%) | |
| Within 1 year | 910,122,251.73 | - | - |
| 1 to 2 years | 662,450,976.98 | - | - |
| 2 to 3 years | 2,467,600.00 | - | - |
| More than 3 years | 711,772.07 | 383,456.60 | 53.87 |
| Total | 1,575,752,600.78 | 383,456.60 | — — |
(2) Disclosure of other receivables by nature
| Item | 31/12/2023 | 31/12/2022 |
| Amounts due from related parties | 1,553,447,353.90 | 2,596,356,894.67 |
| Advances | 4,965,337.56 | 2,467,600.00 |
| Others | 17,339,909.32 | 3,299,953.28 |
| Total | 1,575,752,600.78 | 2,602,124,447.95 |
| Less: Provision for credit loss | 383,456.60 | 383,456.60 |
| Carrying amount | 1,575,369,144.18 | 2,601,740,991.35 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(XX)NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS- continued
1. Other receivables - continued
1.3 Other receivables - continued
(3) Provision for credit loss of other receivables
CHINA MERCHANTS PORT GROUP CO., LTD.Credit rating
| Credit rating | Expected credit loss rate (%) | 31/12/2023 | 31/12/2022 | ||||||
| 12-month ECL | Lifetime ECL (not credit-impaired) | Lifetime ECL (credit-impaired) | Total | 12-month ECL | Lifetime ECL (not credit-impaired) | Lifetime ECL (credit-impaired) | Total | ||
| A | 0.00-0.10 | 1,575,369,144.18 | - | - | 1,575,369,144.18 | 2,601,740,991.35 | - | - | 2,601,740,991.35 |
| B | 0.10-0.30 | - | - | - | - | - | - | - | - |
| C | 0.30-50.00 | - | - | - | - | - | - | - | - |
| D | 50.00-100.00 | - | - | 383,456.60 | 383,456.60 | - | - | 383,456.60 | 383,456.60 |
| Gross carrying amount | 1,575,369,144.18 | - | 383,456.60 | 1,575,752,600.78 | 2,601,740,991.35 | - | 383,456.60 | 2,602,124,447.95 | |
| Provision for credit loss | - | - | 383,456.60 | 383,456.60 | - | - | 383,456.60 | 383,456.60 | |
| Carrying amount | 1,575,369,144.18 | - | - | 1,575,369,144.18 | 2,601,740,991.35 | - | - | 2,601,740,991.35 | |
(4) Provision, recovery and reversal of credit loss of other receivables
| Item | Stage 1 | Stage 2 | Stage 3 | Total |
| 12-month ECL | Lifetime ECL (not credit-impaired) | Lifetime ECL (credit-impaired) | ||
| At 1 January 2023 | - | - | 383,456.60 | 383,456.60 |
| Balance of other receivables at 1 January 2023 | ||||
| - Transfer to Stage 2 | - | - | - | - |
| - Transfer to Stage 3 | - | - | - | - |
| - Reverse to Stage 2 | - | - | - | - |
| - Reverse to Stage 1 | - | - | - | - |
| Provision for the year | - | - | - | - |
| Reversal for the year | - | - | - | - |
| Transfer out due to derecognition of financial assets (including direct write-down) | - | - | - | - |
| Other changes | - | - | - | - |
| At 31 December 2023 | - | - | 383,456.60 | 383,456.60 |
(5) Details of bad debt provision
| Category | 31/12/2022 | Changes for the year | 31/12/2023 | ||||
| Provision | Recovery or reversal | Effect of changes in the scope of consolidation | Charge-off or write-off | Other changes | |||
| Bad debt provision assessed on an individual basis | 383,456.60 | - | - | - | - | - | 383,456.60 |
| Bad debt provision assessed on a portfolio basis | - | - | - | - | - | - | - |
| Total | 383,456.60 | - | - | - | - | - | 383,456.60 |
(6) The Company has no recovery or reversal of significant provision for credit loss in the
current year.
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 186 -
(XX)NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS- continued
1. Other receivables - continued
(7) The Group has no other receivables written off during the year.
(8) The top five balances of other receivables at the end of the year classified by debtor
CHINA MERCHANTS PORT GROUP CO., LTD.
Name of entity
| Name of entity | Relationship with the Company | Nature | Closing balance | Aging | Proportion to total other receivables (%) | Closing balance of provision for credit loss |
| Shenzhen Haixing | Subsidiary | Loan to related parties | 1,541,029,169.74 | Within 1 year, 1-2 years | 97.80 | - |
| Wharf Holdings Hong Kong | Subsidiary | Lease payment | 15,189,918.60 | Within 1 year | 0.96 | - |
| Shunkong Port | Subsidiary | Loan to related parties | 12,418,184.16 | Within 1 year, 1-2 years | 0.79 | - |
| CM International Tech | Subsidiary | Advances | 2,467,600.00 | 2-3 years | 0.16 | - |
| Shenzhen Shekou Local Taxation Bureau | Third party | Others | 711,772.07 | More than 3 years | 0.05 | - |
| Total | 1,571,816,644.57 | 99.76 | - |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 187 -
(XX)NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS - continued
2. Long-term equity investments
(1) Breakdown of long-term equity investments
CHINA MERCHANTS PORT GROUP CO., LTD
Investee
| Investee | 31/12/2022 | Changes for the year | 31/12/2023 | Closing balance of provision for impairment | |||||||
| Increase | Decrease | Investment income under equity method | Reconciliation of other comprehensive income | Other equity movements | Cash dividends or profit declared | Provision for impairment | Others | ||||
| I. Subsidiaries | |||||||||||
| Shenzhen Chiwan International Freight Agency Co., Ltd. | 5,500,000.00 | - | - | - | - | - | - | - | - | 5,500,000.00 | - |
| Shenzhen Chiwan Harbor Container Co. Ltd. | 250,920,000.00 | - | - | - | - | - | - | - | - | 250,920,000.00 | - |
| Shenzhen Chiwan Port Development Co., Ltd. | 206,283,811.09 | - | - | - | - | - | - | - | - | 206,283,811.09 | - |
| Wharf Holdings Hong Kong | 1,070,000.00 | - | - | - | - | - | - | - | - | 1,070,000.00 | - |
| Shenzhen Chiwan Tugboat Co., Ltd. | 24,000,000.00 | - | - | - | - | - | - | - | - | 24,000,000.00 | - |
| Chiwan Container Terminal Co., Ltd. | 421,023,199.85 | - | - | - | - | - | - | - | - | 421,023,199.85 | - |
| Shenchiwan Port Affairs | 186,525,000.00 | - | - | - | - | - | - | - | - | 186,525,000.00 | - |
| Dongguan Shenchiwan Wharf Co., Ltd. | 175,000,000.00 | - | - | - | - | - | - | - | - | 175,000,000.00 | - |
| Chiwan Shipping (Hong Kong) Limited | 1,051,789.43 | - | - | - | - | - | - | - | - | 1,051,789.43 | - |
| CM Port (Note 1) | 168,841,768.35 | 12,474,393.06 | - | - | - | - | - | - | - | 181,316,161.41 | - |
| Zhoushan RoRo | 149,709,800.00 | - | - | - | - | - | - | 43,605,014.00 | - | 106,104,786.00 | 43,605,014.00 |
| Zhanjiang Port | 3,381,825,528.52 | - | - | - | - | - | - | - | - | 3,381,825,528.52 | - |
| CM International Tech (Note 2) | 20,561,075.02 | 109,901,500.00 | - | - | - | - | - | - | - | 130,462,575.02 | - |
| Sanya Merchants Port Development Co., Ltd. | 2,040,000.00 | - | - | - | - | - | - | - | - | 2,040,000.00 | - |
| Ports Development (Hong Kong) Limited | 29,203,045,326.23 | - | - | - | - | - | - | - | - | 29,203,045,326.23 | - |
| Shunkong Port (Note 3) | 50,000,000.00 | 144,673,400.00 | - | - | - | - | - | - | - | 194,673,400.00 | - |
| Guangdong Yide Port Co., Ltd. | 131,866,700.00 | - | - | - | - | - | - | - | - | 131,866,700.00 | - |
| Sub-total | 34,379,263,998.49 | 267,049,293.06 | - | - | - | - | - | 43,605,014.00 | - | 34,602,708,277.55 | 43,605,014.00 |
| II. Associates | |||||||||||
| Ningbo Zhoushan | 16,228,879,526.87 | - | - | 966,972,107.64 | 18,734,157.32 | -45,798,686.57 | -355,122,265.53 | - | - | 16,813,664,839.73 | - |
| China Merchants Northeast Asia Development & Investment Co., Ltd. | 1,017,010,205.71 | - | - | 1,668,941.79 | - | -144,795.94 | - | - | - | 1,018,534,351.56 | - |
| China Merchants Bonded Logistics Co., Ltd. | 412,362,918.79 | - | - | 54,128,341.59 | - | - | -84,285,525.91 | - | - | 382,205,734.47 | - |
| Antong Holdings (Note 4) | - | 892,445,435.37 | - | 29,869,705.60 | - | 17,223.61 | - | - | - | 922,332,364.58 | - |
| Sub-total | 17,658,252,651.37 | 892,445,435.37 | - | 1,052,639,096.62 | 18,734,157.32 | -45,926,258.90 | -439,407,791.44 | - | - | 19,136,737,290.34 | - |
| III. Joint ventures | - | - | |||||||||
| Yantai Port Group Laizhou Port Co., Ltd. | 794,153,389.74 | - | - | 38,645,587.47 | -280,000.00 | -1,858,614.11 | -28,133,178.67 | - | - | 802,527,184.43 | - |
| Fujian Zhaohang Logistics Management Partnership (Limited Partnership) | 592,134,266.75 | - | - | 21,878,659.99 | - | 714,032.74 | - | - | - | 614,726,959.48 | - |
| Shenzhen Gangteng Internet Technology Co., Ltd. (Note 5) | 9,809,165.14 | 3,750,000.00 | - | -1,640,538.15 | - | - | - | - | - | 11,918,626.99 | - |
| Sub-total | 1,396,096,821.63 | 3,750,000.00 | 58,883,709.31 | -280,000.00 | -1,144,581.37 | -28,133,178.67 | - | - | 1,429,172,770.90 | - | |
| Total | 53,433,613,471.49 | 1,163,244,728.43 | - | 1,111,522,805.93 | 18,454,157.32 | -47,070,840.27 | -467,540,970.11 | 43,605,014.00 | - | 55,168,618,338.79 | 43,605,014.00 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
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(XX)NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS- continued
2. Long-term equity investments - continued
(1) Details of long-term equity investments - continued
Note 1: Details are set out in Note (XI) 1. (1).
Note 2: Details are set out in Note (XI) 2. (1).
Note 3: In July and December 2023, the Company and Guangdong Shunkong City Investment
Real Estate Co. Ltd. entered into a capital increase agreement for Shunkong Port in twoparts, whereby the two parties agreed to increase the capital by RMB 218,751,400.00 andRMB 153,823,600.00 together in accordance with their respective shareholding ratios of51% and 49%, of which the Company contributed RMB 111,563,200.00 and RMB78,450,000.00. According to the capital increase agreement, the Company paid a total ofRMB 144,673,400.00 for the capital increase at the end of the year. The shareholding ratioof the two investors remained unchanged after the capital increase.
Note 4: Details are set out in Note (VIII) 14.
Note 5: The Company fulfilled the investment agreement in the current year and paid the second
contribution amounting to RMB 3,750,000.00.
(2) Details of impairment testing of long-term equity investments
The Company recognized a provision for impairment of long-term equity investmentsamounting to RMB 43,605,014.00 based on the share of Zhoushan RoRo's recoverableamount, refer to Note (VIII), 16.2 (7) for details.
3. Operating income and operating costs
CHINA MERCHANTS PORT GROUP CO., LTD
Item
| Item | 2023 | 2022 | ||
| Income | Cost | Income | Cost | |
| Principal operation | - | - | - | - |
| Other operations | 17,326,885.29 | 3,686,411.84 | 3,669,891.36 | 2,276,202.60 |
| Total | 17,326,885.29 | 3,686,411.84 | 3,669,891.36 | 2,276,202.60 |
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 DECEMBER 2023(Unless otherwise specified, the monetary unit shall be RMB)
- 189 -
(XX)NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS- continued
4. Investment income
(1) Details of investment income
CHINA MERCHANTS PORT GROUP CO., LTDItem
| Item | 2023 | 2022 |
| Income from long-term equity investments under cost method | 416,405,658.26 | 549,150,517.02 |
| Income from long-term equity investments under equity method | 1,111,522,805.93 | 384,257,363.02 |
| Income from held-for-trading financial assets | 49,614,971.08 | 120,227,079.12 |
| Income from investments in other equity instruments | 20,056,500.00 | - |
| Income from disposal of long-term equity investments | - | -20,508.07 |
| Total | 1,597,599,935.27 | 1,053,614,451.09 |
(2) Income from long-term equity investments under cost method
| Investee | 2023 | 2022 | Reason for changes |
| Chiwan Container Terminal Co., Ltd. | 149,527,479.94 | 166,925,696.05 | Changes in profit distribution of investee |
| Shenzhen Chiwan Harbor Container Co. Ltd. | 111,712,423.41 | 173,751,858.77 | Changes in profit distribution of investee |
| Zhanjiang Port | 36,552,790.18 | 91,862,080.91 | Changes in profit distribution of investee |
| Dongguan Shenchiwan Wharf Co., Ltd. | 33,386,741.74 | 37,543,998.58 | Changes in profit distribution of investee |
| Dongguan Shenchiwan Port Affairs Co., Ltd. | 26,519,896.50 | 18,111,237.23 | Changes in profit distribution of investee |
| Shenzhen Chiwan Tugboat Co., Ltd. | 20,137,075.44 | 29,238,925.84 | Changes in profit distribution of investee |
| CM Port | 11,184,689.72 | 11,069,965.98 | Changes in profit distribution of investee |
| Shenzhen Chiwan Port Development Co., Ltd. | 9,751,697.73 | 20,415,654.72 | Changes in profit distribution of investee |
| CM International Tech | 9,517,336.07 | - | Changes in profit distribution of investee |
| Chiwan Shipping (Hong Kong) Limited | 7,902,673.23 | - | Changes in profit distribution of investee |
| Shenzhen Chiwan International Freight Agency Co., Ltd. | 212,854.30 | 231,098.94 | Changes in profit distribution of investee |
| Total | 416,405,658.26 | 549,150,517.02 | -- |
SUPPLEMENTARY INFORMATIONFOR THE YEAR ENDED 31 DECEMBER 2023
1. BREAKDOWN OF NON-RECURRING PROFIT OR LOSS
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Amount | Remark |
| Gains or losses on disposal of non-current assets, including those charged off for which provision for impairment of assets has been made | 231,205,985.85 | |
| Government grants recognized in profit or loss (other than grants which are closely related to the Company's business, in line with the national regulations, enjoyed under established standards and have a continuous impact on the Company's profit or loss) | 149,238,503.34 | |
| Income earned from lending funds to non-financial institutions and recognized in profit or loss | 194,897,544.80 | |
| The excess of attributable fair value of identifiable net assets over the consideration paid for subsidiaries, associates and joint ventures | - | |
| Gains or losses on exchange of non-monetary assets | - | |
| Gains or losses on entrusted investments or asset management | - | |
| Losses on assets due to force majeure, e.g., natural disasters | - | |
| Gains or losses on debt restructuring | - | |
| Lump-sum costs incurred by the enterprises as a result of the discontinuation of relevant business activities, e.g., expenditure for layoff of employees, etc. | - | |
| Gains from transactions with unfair transaction price | - | |
| Net profit or loss of subsidiaries recognized as a result of business combination of enterprises under common control from the beginning of the period up to the business combination date | - | |
| Gains or losses arising from contingencies other than those related to normal operating business | - | |
| Gains or losses from changes in fair value of financial assets and financial liabilities held by non-financial enterprises other than effective hedging operation relating to the Company's normal operations, and gains or losses from disposal of financial assets and financial liabilities | 73,352,800.52 | |
| Reversal of provision for accounts receivable that are tested for impairment individually | 52,962,785.14 | |
| Gains or losses on entrusted loans | - | |
| Gains or losses from changes in fair value of investment properties that are subsequently measured using the fair value model | - | |
| One-time effect of adjustments in tax laws and accounting laws and regulations on profit or loss for the period | - | |
| Custodian fees earned from entrusted operation | - | |
| Share-based payment expenses recognized once due to the cancellation or modification of equity incentive plans | - | |
| For cash-settled share-based payments, gains or losses arising from changes in fair value of employee benefits payable after the vesting date | - | |
| Other non-operating income or expenses other than above | 12,810,280.19 | |
| Other profit or loss that meets the definition of non-recurring profit or loss | - | |
| Tax effects | -145,340,260.29 | |
| Effects of minority interests (after tax) | -336,553,661.12 | |
| Total | 232,573,978.43 |
The revised Explanatory Announcement No. 1 on Information Disclosure for Companies Making PublicOffering - Non-recurring Profit or Loss (Revised in 2023) was issued by the China Securities RegulatoryCommission on 22 December 2023, and the effect of the revision on non-recurring profit or loss for thecomparable accounting periods is reflected as a decrease of non-recurring profit or loss by RMB18,600,132.64.
SUPPLEMENTARY INFORMATIONFOR THE YEAR ENDED 31 DECEMBER 2023
2. RETURN ON NET ASSETS AND EARNINGS PER SHARE ("EPS")
The return on net assets and EPS have been prepared by the Company in accordance with InformationDisclosure and Presentation Rules for Companies Making Public Offering No. 9 - Calculation andDisclosure of Return on Net Assets and Earnings per Share (revised in 2010) issued by China SecuritiesRegulatory Commission.
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | Weighted average return on net assets (%) | EPS | |
| Basic EPS | Diluted EPS | ||
| Net profit attributable to ordinary shareholders | 6.3455 | 1.4292 | 1.4292 |
| Net profit attributable to ordinary shareholders after deducting non-recurring profit or loss | 5.9324 | 1.3362 | 1.3362 |
SUPPLEMENTARY INFORMATIONFOR THE YEAR ENDED 31 DECEMBER 2023
3. SUPPLEMENTARY INFORMATION RELATING TO ITEMS IN THE FINANCIAL
STATEMENTS DUE TO RETROSPECTIVE APPLICATION OF ACCOUNTINGPOLICIES
CHINA MERCHANTS PORT GROUP CO., LTD.
Item
| Item | 31/12/2023 | 31/12/2022 | 1/1/2022 | Item | 31/12/2023 | 31/12/2022 | 1/1/2022 |
| Current Assets: | Current liabilities: | ||||||
| Cash and bank balances | 16,079,646,178.24 | 13,615,928,739.40 | 12,772,349,406.77 | Short-term borrowings | 15,714,045,288.97 | 7,164,338,366.18 | 13,651,452,805.36 |
| Held-for-trading financial assets | 4,568,806,108.84 | 2,998,781,599.63 | 6,921,831,502.55 | Notes payable | 73,461,165.82 | - | 1,895,987.17 |
| Notes receivable | 325,150,195.09 | 36,395,000.00 | 6,081,611.95 | Accounts payable | 691,765,137.25 | 811,149,397.66 | 843,820,438.51 |
| Accounts receivable | 1,103,901,466.25 | 1,276,149,689.44 | 1,320,577,577.81 | Receipts in advance | 17,387,537.36 | 9,886,531.59 | 9,313,166.01 |
| Receivables financing | 2,001,669.46 | 163,766,913.10 | 238,429,402.71 | Contract liabilities | 142,080,101.00 | 141,899,551.03 | 196,784,525.26 |
| Prepayments | 37,664,552.30 | 63,627,425.42 | 51,606,794.20 | Employee benefits payable | 917,964,606.65 | 936,834,718.13 | 820,416,415.47 |
| Other receivables | 940,014,994.01 | 948,842,094.30 | 696,276,595.87 | Taxes payable | 923,053,572.50 | 917,933,169.09 | 2,162,719,251.68 |
| Inventories | 218,898,192.87 | 225,122,821.48 | 194,920,136.12 | Other payables | 1,654,622,170.02 | 1,755,885,258.26 | 2,140,108,341.08 |
| Assets held-for-sale | - | - | 337,442,757.28 | Non-current liabilities due within one year | 6,817,404,289.25 | 11,641,223,688.95 | 8,268,209,284.17 |
| Non-current assets due within one year | 17,451,380.98 | 902,225,293.93 | 102,356,461.97 | Other current liabilities | 2,143,842,534.53 | 3,161,147,525.96 | 2,158,497,775.85 |
| Other current assets | 189,673,500.87 | 185,903,140.53 | 339,684,297.41 | Total current liabilities | 29,095,626,403.35 | 26,540,298,206.85 | 30,253,217,990.56 |
| Total current assets | 23,483,208,238.91 | 20,416,742,717.23 | 22,981,556,544.64 | Non-current Liabilities: | |||
| Non-current Assets: | Long-term borrowings | 18,227,543,954.71 | 12,390,099,177.85 | 7,144,839,870.89 | |||
| Long-term receivables | 3,856,466,116.99 | 5,661,327,499.07 | 6,162,713,861.02 | Bonds payable | 14,287,508,564.15 | 19,088,293,099.02 | 16,670,872,414.14 |
| Long-term equity investments | 96,666,117,776.27 | 92,364,293,919.05 | 70,353,451,824.52 | Including: Preferred shares | - | - | - |
| Other non-current financial assets | 877,576,442.83 | 1,745,740,896.41 | 809,515,244.87 | Perpetual bonds | - | - | - |
| Investments in other equity instruments | 157,461,648.16 | 171,945,275.02 | 180,251,798.43 | Provisions | 1,001,172,206.92 | 948,350,914.04 | 1,055,194,906.09 |
| Investment properties | 4,958,374,968.79 | 5,123,690,119.56 | 5,298,238,414.88 | Lease liabilities | 3,822,862,202.17 | 3,551,315,590.31 | 3,422,179,366.40 |
| Fixed assets | 28,986,538,326.35 | 32,033,326,083.50 | 31,710,513,230.29 | Long-term payables | 603,009,921.91 | 639,095,931.43 | 588,681,492.63 |
| Construction in progress | 2,909,817,281.46 | 2,413,844,407.64 | 2,557,584,953.92 | Long-term employee benefits payable | 85,590,059.41 | 35,365,156.43 | 24,247,302.42 |
| Right-of-use assets | 9,441,668,311.22 | 9,342,642,222.33 | 8,743,077,542.19 | Deferred income | 1,024,776,557.73 | 1,031,273,189.74 | 1,075,957,884.91 |
| Intangible assets | 18,073,062,184.72 | 19,277,065,115.61 | 18,475,412,380.93 | Deferred tax liabilities | 4,659,638,104.37 | 4,855,019,835.33 | 4,552,418,519.70 |
| Development expenditure | 50,990,153.18 | 17,412,196.16 | 82,391,225.85 | Other non-current liabilities | 179,634,263.73 | 186,383,117.00 | 163,065,578.53 |
| Goodwill | 6,493,002,246.44 | 6,411,426,891.09 | 6,024,160,942.07 | Total non-current liabilities | 43,891,735,835.10 | 42,725,196,011.15 | 34,697,457,335.71 |
| Long-term prepaid expenses | 993,793,505.29 | 986,356,904.90 | 975,994,541.52 | TOTAL LIABILITIES | 72,987,362,238.45 | 69,265,494,218.00 | 64,950,675,326.27 |
| Deferred tax assets | 415,063,477.03 | 434,498,820.95 | 454,644,724.39 | Owners' equity: | |||
| Other non-current assets | 1,194,155,989.62 | 1,186,789,378.79 | 1,231,092,952.69 | Share capital | 2,499,074,661.00 | 2,499,074,661.00 | 1,922,365,124.00 |
| Total non-current assets | 175,074,088,428.35 | 177,170,359,730.08 | 153,059,043,637.57 | Including: Preferred shares | - | - | - |
| Perpetual bonds | - | - | - | ||||
| Capital reserve | 37,076,846,803.06 | 34,751,640,835.25 | 23,592,702,758.70 | ||||
| Less: Treasury shares | - | - | - | ||||
| Other comprehensive income | -903,626,594.35 | -689,553,619.86 | -890,125,318.18 | ||||
| Special reserve | 34,003,994.41 | 26,358,259.97 | 9,184,429.12 | ||||
| Surplus reserve | 1,095,980,563.68 | 1,001,917,449.15 | 961,182,562.00 | ||||
| Unappropriated profit | 19,045,313,519.75 | 16,701,988,301.14 | 14,226,931,466.66 | ||||
| Total equity attributable to equity holders of the Company | 58,847,592,947.55 | 54,291,425,886.65 | 39,822,241,022.30 | ||||
| Minority interests | 66,722,341,481.26 | 74,030,182,342.66 | 71,267,683,833.64 | ||||
| TOTAL OWNERS' EQUITY | 125,569,934,428.81 | 128,321,608,229.31 | 111,089,924,855.94 | ||||
| TOTAL ASSETS | 198,557,296,667.26 | 197,587,102,447.31 | 176,040,600,182.21 | TOTAL LIABILITIES AND OWNERS' EQUITY | 198,557,296,667.26 | 197,587,102,447.31 | 176,040,600,182.21 |