China Huajun : ANNOUNCEMENT OF AUDITED ANNUAL RESULTS FOR THE YEAR ENDED 31 DECEMBER 2020

April 01, 2021 at 03:41 am IST

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

CHINA HUAJUN GROUP LIMITED

中國華君集團有限公司

(Incorporated in Bermuda with limited liability)

(Stock Code: 377)

ANNOUNCEMENT OF AUDITED ANNUAL RESULTS

FOR THE YEAR ENDED 31 DECEMBER 2020

FINANCIAL HIGHLIGHTS
	Year	Year
	ended	ended
	31.12.2020	31.12.2019	Change
	RMB Million	RMB Million
Revenue	3,515.5	3,699.6	-5.0%
Gross profit	40.9	304.2	-86.6%
Loss for the year	(1,629.8)	(633.8)	157.1%
Total assets	16,992.5	17,655.5	-3.8%
Total equity	1,116.1	2,721.2	-59.0%

AUDITED ANNUAL RESULTS

The board (the "Board") of directors (the "Director(s)") of China Huajun Group Limited (the "Company", together with its subsidiaries, the "Group") is pleased to present the audited annual results of the Group for the year ended 31 December 2020 together with the comparative figures for the year ended 31 December 2019, as follows:

CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER 2020

		2020			2019
	Notes	RMB'000	RMB'000
Revenue	4
Goods and services		3,497,209			3,675,741
Finance lease income		616			127
Interest income from provision of finance		1,537			2,064
Rental income from property investments		14,069			9,615
Dividend from securities investments		1,780			5,374
Others		240			6,685

Total revenue		3,515,451			3,699,606
Cost of sales and services		(3,474,518)	(3,395,404)

Gross profit		40,933			304,202
Other gains and losses	6	665			8,049
Other income	7	65,013			16,577
Change in fair value of investment properties		(175,975)	237,945
Selling and distribution expenses		(134,167)	(151,999)
Administrative expenses		(354,109)	(380,157)
Impairment of goodwill		(8,087)	-
Impairment loss recognised in respect of
- trade receivables		(13,898)	(27,042)
- other receivables		(74,858)	(11,712)
- loan and interest receivables		(11,525)	-
- property, plant and equipment		(114,366)	-
Finance costs	8	(898,708)	(572,252)
Share of profit from an associate		518		813
Share of loss from a joint venture		-	(216)
Gain on disposal of subsidiaries		22,393		11
Change in fair value of convertible bonds
- derivative component		4,697		12,498

Loss before tax		(1,651,474)	(563,283)
Income tax credit (expense)	9	21,630			(70,472)

Loss for the year	10	(1,629,844)	(633,755)

		2020		2019
	Notes	RMB'000	RMB'000
Other comprehensive (expense) income
Items that may be reclassified subsequently to
profit or loss:
Exchange differences on translating of foreign operations		(78,827)	(8,694)
Change in fair value of debt instruments at fair value
through other comprehensive income ("FVTOCI")		(76)	939
Reclassification adjustment relating to (gain) loss
on disposal of debt instruments at FVTOCI
included in profit or loss		(1,142)	1,814

		(80,045)	(5,941)
Item that will not be reclassified to profit or loss:
Exchange differences on translation to
presentation currency		98,207	12,850

Other comprehensive income for the year		18,162		6,909

Total comprehensive expense for the year		(1,611,682)	(626,846)
(Loss) profit for the year attributable to:


- Shareholders of the Company		(1,573,818)	(644,710)
- Non-controlling interests		(56,026)	10,955

		(1,629,844)	(633,755)
Total comprehensive (expense) income attributable to:


- Shareholders of the Company		(1,555,812)	(637,811)
- Non-controlling interests		(55,870)	10,965

		(1,611,682)	(626,846)


		RMB	RMB
Loss per share	11
Basic		(25.57)	(10.59)


Diluted		(25.57)	(10.59)

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2020

		2020		2019
	Notes	RMB'000	RMB'000
NON-CURRENT ASSETS
Property, plant and equipment		2,028,418		2,027,984
Investment properties		5,159,166	4,863,150
Goodwill		-	8,087
Interest in an associate		29,731	29,213
Deposits for property, plant and equipment,
right-of-use assets and investment properties		62,680	649,887
Financial assets at fair value through profit or loss
("FVTPL")		28,998	35,815
Other receivables and deposits	12	101,914		83,892
Debt instruments at FVTOCI		3,282	26,762
Deferred tax assets		15,730	17,221
Right-of-use assets		524,993	620,685

		7,954,912		8,362,696
CURRENT ASSETS

Properties held for sale		7,109,134		7,440,044
Inventories		230,892	233,948
Trade and other receivables, deposits and prepayments	12	1,291,324		935,351
Loan and interest receivables	13	-	15,004
Tax recoverable		23,689	1,354
Financial assets at FVTPL		10,535	13,888
Restricted bank balance		46,878	69,109
Pledged bank deposits		46,946	313,265
Bank balances and cash		219,083	270,836

		8,978,481		9,292,799
Assets classified as held for sale		59,139	-

		9,037,620		9,292,799

		2020		2019
	Notes	RMB'000	RMB'000
CURRENT LIABILITIES
Trade and other payables, and other liabilities	14	2,374,295		1,148,011
Bill payables		428,073	729,969
Tax payable		119,986	105,816
Borrowings	15	9,084,328		4,266,637
Contract liabilities		1,490,704	1,513,556
Corporate bonds		1,699	3,612
Convertible bonds - liability component		193,935	-
Convertible bonds - derivative component		33	-
Deferred consideration		51,020	-
Lease liabilities		14,238	30,570

		13,758,311		7,798,171

NET CURRENT (LIABILITIES) ASSETS		(4,720,691)	1,494,628

TOTAL ASSETS LESS CURRENT LIABILITIES		3,234,221		9,857,324
NON-CURRENT LIABILITIES

Deferred consideration		-	95,000
Deferred income		155,664	103,491
Deferred tax liabilities		98,362	141,415
Amount due to immediate holding company		35,089	16,655
Borrowings	15	1,125,620		5,905,780
Corporate bonds		83,113	76,921
Convertible bonds - liability component		612,229	776,973
Convertible bonds - derivative component		-	4,942
Lease liabilities		8,017	14,923

		2,118,094		7,136,100

NET ASSETS		1,116,127		2,721,224
CAPITAL AND RESERVES


Share capital	16	55,983		55,983
Reserves		1,048,221	2,597,448

Equity attributable to shareholders of the Company		1,104,204		2,653,431
Non-controlling interests		11,923	67,793

TOTAL EQUITY		1,116,127		2,721,224

NOTES

1. GENERAL

China Huajun Group Limited (formerly known as Huajun International Group Limited) (the "Company") is a limited company incorporated in Bermuda as an exempted company and its shares are listed on the Main Board of The Stock Exchange of Hong Kong Limited (the "Stock Exchange"). The registered office of the Company is located at Clarendon House, 2 Church Street, Hamilton HM11, Bermuda. The principal place of its business is 36/F, Champion Tower, 3 Garden Road, Central, Hong Kong. As at 31 December 2020, the directors of the Company (the "Directors") consider that immediate and ultimate holding company of the Company to be Huajun Group Limited ("HGL") which is incorporated in Hong Kong. Its ultimate controlling party is Mr. Meng Guang Bao ("Mr. Meng"), who is the chairman of the Board of Directors and an executive director of the Company.

Pursuant to a special resolution passed by the shareholders of the Company on 28 August 2020, the Certificate of Incorporation on Change of Name and the Certificate of Secondary Name were issued by the Registrar of Companies in Bermuda on 24 September 2020 certifying that the change of name has been registered on 28 August 2020 and a Certificate of Registration of Alteration of Name of Registered Non-Hong Kong Company was issued by the Registrar of Companies in Hong Kong on 9 October 2020 confirming the registration of the new name of the Company in Hong Kong under Part 16 of the Companies Ordinance (Chapter 622 of the Laws of Hong Kong), the name of the Company was changed from "Huajun International Group Limited" to "China Huajun Group Limited" and the dual foreign name in Chinese of the Company from

華君國際集團有限公司" to " 中國華君集團有限公司".

The Company acts as an investment holding company. The Company and its subsidiaries are collectively referred to as the "Group".

The functional currency of the Company is Hong Kong dollars ("HK$") while the consolidated financial statements of the Group are presented in Renminbi ("RMB") to enable the shareholders of the Company to have a more accurate picture of the Group's financial position and performance.

2. BASIS OF PREPARATION OF CONSOLIDATED FINANCIAL STATEMENTS

In preparing the consolidated financial statements, the Directors have given careful consideration to the future liquidity of the Group in light of the fact that as of 31 December 2020 the Group has capital and other commitments of RMB1,991,721,000 and incurred a net loss of RMB1,629,844,000 for the year ended 31 December 2020.

The Directors consider that it is appropriate to prepare the consolidated financial statements on the going concern basis taking into account the following facts and assumptions:

Continuous financial support from the immediate holding company
The immediate holding company has agreed to continue to provide financial support to the Group when in need. As at 31 December 2020, approximately RMB39,636,000 of advances has been drawn which the immediate holding company agreed not to demand for the repayment until 1 May 2022.

Negotiation with banks on defaulted borrowings
The Group had breached the repayment terms of several tranches of borrowings and the Directors are in the process of negotiation with the counterparties over the revised repayment schedule and refinancing arrangements.
Cash inflow from operations

The Group is expected to generate adequate cash flows to maintain its operations.

The Directors believe that, taking into account the above factors, the Group will have sufficient working capital to satisfy its present requirements for the year ending 31 December 2021. However, should the above financing be unavailable (in particular the continuous financial support from the immediate holding company, banking facilities from the banks and financial institutions as well as the renewal and refinancing of existing borrowings. If the Group is not able to generate the expected cash inflows from its operations and to refinance its borrowings, the Group may be unable to operate as a going concern, in which case adjustments might have to be made to the carrying values of the Group's assets to state them at their realisable values, to provide for any further liabilities which might arise and to reclassify its non-current assets and non-current liabilities to current assets and current liabilities, respectively.

3. APPLICATION OF NEW AND AMENDMENTS TO HONG KONG FINANCIAL REPORTING STANDARDS ("HKFRS(s)")

In the current year, the Group has applied, for the first time, the Amendments to References to the Conceptual Framework in Hong Kong Financial Reporting Standards ("HKFRSs") and the following amendments to HKFRSs issued by the Hong Kong Institute of Certified Public Accountants (the "HKICPA") which are effective for the Group's financial year beginning 1 January 2020:

Amendments to HKFRS 3	Definition of a Business
Amendments to HKAS 1 and HKAS 8	Definition of Material
Amendments to HKFRS 9, HKAS 39 and HKFRS 7	Interest Rate Benchmark Reform

Except as described below, the application of the Amendments to References to the Conceptual Framework in HKFRSs and the amendments to HKFRSs in the current year has had no material effect on the Group's financial performance and positions for the current and prior periods and/or on the disclosures set out in these consolidated financial statements.

Amendments to HKFRS 3, Definition of a Business

The amendments clarify the definition of a business and provide further guidance on how to determine whether a transaction represents a business combination. In addition, the amendments introduce an optional "concentration test" that permits a simplified assessment of whether an acquired set of activities and assets is an asset rather than business acquisition, when substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets.

The Group has applied the amendments prospectively to transactions for which the acquisition date is on or after 1 January 2020. These amendments had no impact on the consolidated financial statements in the current year.

Amendments to HKAS 1 and HKAS 8, Definition of Material

The amendments provide a new definition of material that states "information is material if omitting, misstating or obscuring it could reasonably be expected to influence decisions that the primary users of general purpose financial statements make on the basis of those financial statements, which provide financial information about a specific reporting entity." The amendments clarify that materiality will depend on the nature or magnitude of information, either individually or in combination with other information, in the context of the financial statements. A misstatement of information is material if it could reasonably be expected to influence decisions made by the primary users.

New and amendments to HKFRSs issued but not yet effective

The Group has not early applied the following new and amendments to HKFRSs that have been issued but are not yet effective:

HKFRS 17	Insurance Contracts and related Amendments3
Amendments to HKFRS 3	Reference to the Conceptual Framework2
Amendments to HKFRS 10 and	Sale or Contribution of Assets between an Investor and its Associate or Joint
HKAS 28	Venture5
Amendments to HKAS 1	Classification of Liabilities as Current or Non-current and the related
	amendments to Hong Kong Interpretation 5(2020) Presentation of
	Financial Statements - Classification by the Borrower of a Term Loan
	that Contains a Repayment on Demand Clause3
Amendments to HKAS 16	Property, plant and equipment: Proceeds before Intended Use2
Amendments to HKAS 37	Onerous Contracts: Cost of Fulfilling a Contract2
Amendments to HKFRS 9,	Interest Rate Benchmark Reform - Phase 21
HKAS 39, HKFRS 7,
HKFRS 4 and HKFRS 16
Amendment to HKFRS 16	COVID-19-Related Rent Concessions4
Amendments to HKFRSs	Annual improvements to HKFRSs 2018-2020 cycle2

Effective for annual periods beginning on or after 1 January 2021. Effective for annual periods beginning on or after 1 January 2022. Effective for annual periods beginning on or after 1 January 2023. Effective for annual periods beginning on or after 1 June 2020.

Effective for annual periods beginning on or after a date to be determined.

The Directors anticipate that, except as described below, the application of the new and amendments to HKFRSs will have no material impact on the results and the financial position of the Group.

Amendments to HKFRS 3 - Reference to the Conceptual Framework

The amendments update HKFRS 3 so that it refers to the 2018 Conceptual Framework instead of the 1989 Framework. They also add to HKFRS 3 a requirement that, for obligations within the scope of HKAS 37, an acquirer applies HKAS 37 to determine whether at the acquisition date a present obligation exists as a result of past events. For a levy that would be within the scope of HK(IFRIC)-Int 21 Levies, the acquirer applies HK(IFRIC)-Int 21 to determine whether the obligating event that gives rise to a liability to pay the levy has occurred by the acquisition date. Finally, the amendments add an explicit statement that an acquirer does not recognise contingent assets acquired in a business combination.

The amendments are effective for business combinations for which the date of acquisition is on or after the beginning of the first annual period beginning on or after 1 January 2022. Early application is permitted if an entity also applies all other updated references (published together with the updated Conceptual Framework) at the same time or earlier.

Amendments to HKAS 1 - Classification of Liabilities as Current or Non-current and related amendments to Hong Kong Interpretation 5 (2020)

The amendments to HKAS 1 affect only the presentation of liabilities as current or non-current in the statement of financial position and not the amount or timing of recognition of any asset, liability, income or expenses, or the information disclosed about those items.

The amendments clarify that the classification of liabilities as current or non-current is based on rights that are in existence at the end of the reporting period, specify that classification is unaffected by expectations about whether an entity will exercise its right to defer settlement of a liability, explain that rights are in existence if covenants are complied with at the end of the reporting period, and introduce a definition of 'settlement' to make clear that settlement refers to the transfer to the counterparty of cash, equity instruments, other assets or services.

Hong Kong Interpretation 5 was revised as a consequence of Amendments to HKAS 1 Classification of Liabilities as Current or Non-current to align the corresponding wordings with no change in conclusion.

The amendments are applied retrospectively for annual periods beginning on or after 1 January 2023, with early application permitted.

Based on the Group's outstanding liabilities as at 31 December 2020, the application of the amendments will not result in change in the classification of the Group's liabilities.

Amendments to HKAS 16 - Property, Plant and Equipment - Proceeds before Intended Use

The amendments prohibit deducting from the cost of an item of property, plant and equipment any proceeds from selling items produced before that asset is available for use, i.e. proceeds while bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. Consequently, an entity recognises such sales proceeds and related costs in profit or loss. The entity measures the cost of those items in accordance with HKAS 2 Inventories.

The amendments also clarify the meaning of "testing whether an asset is functioning properly". HKAS 16 now specifies this as assessing whether the technical and physical performance of the asset is such that it is capable of being used in the production or supply of goods or services, for rental to others, or for administrative purposes. If not presented separately in the statement of comprehensive income, the financial statements shall disclose the amounts of proceeds and cost included in profit or loss that relate to items produced that are not an output of the entity's ordinary activities, and which line item(s) in the statement of comprehensive income include(s) such proceeds and cost.

The amendments are applied retrospectively, but only to items of property, plant and equipment that are brought to the location and condition necessary for them to be capable of operating in the manner intended by management on or after the beginning of the earliest period presented in the financial statements in which the entity first applies the amendments.

The entity shall recognise the cumulative effect of initially applying the amendments as an adjustment to the opening balance of retained earnings (or other component of equity, as appropriate) at the beginning of that earliest period presented.

The amendments are effective for annual periods beginning on or after 1 January 2022, with early application permitted.

Amendments to HKAS 37 - Onerous Contracts - Cost of Fulfilling a Contract

The amendments specify that the 'cost of fulfilling' a contract comprises the 'costs that relate directly to the contract'. Costs that relate directly to a contract consist of both the incremental costs of fulfilling that contract (examples would be direct labour or materials) and an allocation of other costs that relate directly to fulfilling contracts (an example would be the allocation of the depreciation charge for an item of property, plant and equipment used in fulfilling the contract).

The amendments apply to contracts for which the entity has not yet fulfilled all its obligations at the beginning of the annual reporting period in which the entity first applies the amendments. Comparatives are not restated. Instead, the entity shall recognise the cumulative effect of initially applying the amendments as an adjustment to the opening balance of retained earnings or other component of equity, as appropriate, at the date of initial application.

The amendments are effective for annual periods beginning on or after 1 January 2022, with early application permitted.

Amendment to HKFRS 16, COVID-19 Related Rent Concessions

The amendment to HKFRS 16 provides a practical expedient for lessees to elect not to apply lease modification accounting for rent concessions arising as a direct consequence of the COVID-19 pandemic. The practical expedient applies only to rent concessions occurring as a direct consequence of the COVID-19 pandemic and only if (i) the change in lease payments results in revised consideration for the lease that is substantially the same as, or less than, the consideration for the lease immediately preceding the change; (ii) any reduction in lease payments affects only payments originally due on or before 30 June 2021; and (iii) there is no substantive change to other terms and conditions of the lease.

A lease applying the practical expedient accounts for changes in lease payments resulting from rent concessions the same way it would account for the changes applying HKFRS 16 as if the changes were not lease modifications. Forgiveness or waiver of lease payments is accounted for as variable lease payments. The related lease liabilities are adjusted to reflect the amounts forgiven or waived with a corresponding adjustment recognised in the profit or loss in the period in which the event occurs.

The amendment is effective for annual periods beginning on or after 1 June 2020. The Directors anticipate that the application of the amendment will have no material impact on the Group's consolidated financial statements.

4. REVENUE

For the year ended 31 December 2020

Disaggregation of revenue from contracts with customers

					For the year ended 31 December 2020

					Property
					development
			Trading and	and	Solar	Financial
	Printing	logistics	investments	photovoltaic	services	Other	Total
	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000
Type of goods and services
Sales of:
- solar photovoltaic products	-	-	-	108,543	-	-	108,543
- printing products	440,527	-	-	-	-	-	440,527
- petrochemical and other related
products	-	2,050,713	-	-	-	-	2,050,713
- properties	-	-	776,216	-	-	-	776,216
- hydraulic machinery	-	-	-	-	-	69,632	69,632
Processing services
- solar photovoltaic products	-	-	-	894	-	-	894
Property management services	-	-	12,166	-	-	-	12,166
Others	-	-	-	-	997	37,521	38,518
Total revenue from contracts

with customers	440,527		2,050,713	788,382	109,437	997	107,153	3,497,209
Finance lease income	-	-	-	-	616	-	616
Interest income from provision of finance	-	-	-	-	1,537	-	1,537
Rental income from property investments	-	-	14,069	-	-	-	14,069
Dividend from securities investments	-	-	-	-	1,780	-	1,780
Others	-	-	240	-	-	-	240

Total revenue	440,527		2,050,713	802,691	109,437	4,930	107,153	3,515,451
Geographical markets


The PRC	173,629		2,040,224	788,382	109,437	-	107,153	3,218,825
The United States of America ("US")	136,939		-	-	-	-	-	136,939
Hong Kong	35,414	-	-	-	997	-	36,411
European countries	38,084	6,734	-	-	-	-	44,818
Other countries	56,461	3,755	-	-	-	-	60,216

Total	440,527		2,050,713	788,382	109,437	997	107,153	3,497,209

For the year ended 31 December 2019

						For the year ended 31 December 2019

						Property
						development
				Trading and	and	Solar	Financial
		Printing	logistics	investments	photovoltaic	services	Other	Total
		RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000
Type of goods and services
Sales of:
- solar photovoltaic products	-	-	-	92,243	-	-	92,243
- printing products	670,189	-	-	-	-	-	670,189
- petrochemical and other related
products	-	2,203,718	-	-	-	-	2,203,718
- properties	-	-	655,966	-	-	-	655,966
- hydraulic machinery	-	-	-	-	-	20,933	20,933
Processing services
- solar photovoltaic products	-	-	-	420	-	-	420
Property management services	-	-	4,758	-	-	-	4,758
Others	-	-	-	-	-	27,514	27,514
Total revenue from contracts with

customers	670,189		2,203,718	660,724	92,663	-	48,447	3,675,741
Finance lease income	-	-	-	-	127	-	127
Interest income from provision of finance	-	-	-	-	2,064	-	2,064
Rental income from property investments	-	-	9,615	-	-	-	9,615
Dividend from securities investments	-	-	-	-	5,374	-	5,374
Others	-	-	6,685	-	-	-	6,685

Total revenue	670,189		2,203,718	677,024	92,663	7,565	48,447	3,699,606


Geographical markets
The PRC	196,613		2,198,836	660,724	92,663	-	48,447	3,197,283
The United States of America ("US")	277,831		-	-	-	-	-	277,831
Hong Kong	50,054	515	-	-	-	-	50,569
European countries	79,498	224	-	-	-	-	79,722
Other countries	66,193	4,143	-	-	-	-	70,336

Total	670,189		2,203,718	660,724	92,663	-	48,447	3,675,741

Revenue from property management services is recognised over time, and the progress measured using the output method. The property management service fees are billed to the tenants monthly. All other revenue of the Group from contracts with customers are recognised at a point of time.

5. OPERATING SEGMENTS

The Group manages its businesses by divisions, which are organised by different business lines. Information reported to the Group's executive directors, being the chief operating decision maker ("CODM"), for the purposes of resource allocation and performance assessment is prepared on this basis. The Group has identified the following five reportable segments under HKFRS 8 Operating Segments as follows:

Printing: Sales and manufacturing of high quality multi-colour packaging products, carton boxes, books, brochures and other paper products

Trading and logistics: Trading, logistics and supply chain management
Property development and investments: Property development and investments, property management services
Solar photovoltaic: Sales and manufacturing of and provision of processing services on solar photovoltaic products
Financial services: Comprised of provision of finance through money lending services; provision of finance through finance lease; provision of securities brokerage services and investment activities in equity securities, funds, bonds and asset management services and other related services

In addition to the operating segments described above, each of which constitutes a reportable segment, the Group has other operating segments which include provision of hotel services, department store business and sales and manufacturing of hydraulic machinery in the PRC for the year ended 31 December 2020. None of these segments meets any of quantitative thresholds for determining reportable segments. Accordingly, all of the above operating segments are grouped as "All other segments".

Segment revenue and results

The following is an analysis of the Group's revenue and results by reportable segments:

For the year ended 31 December 2020

Property

development

Reportable

Trading and

and

Solar

Financial

segments'

All other

Printing

logistics

investments

photovoltaic

services

total

segments

Total

RMB'000

Segment revenue

Revenue from external customers

440,527

2,050,713

802,691

109,437

4,930

3,408,298

107,153

3,515,451

Segment (loss) profit

(65,433)

6,730

(467,140)

(167,169)

(11,553)

(704,565)

(47,965)

(752,530)

Unallocated amounts

Change in fair value of convertible bonds

- derivative component

4,697

Corporate administrative expenses

(56,313)

Corporate other income

28,948

Finance costs

(898,708)

Gain on disposal of subsidiaries

22,393

Other gains and losses

(479)

Share of profit from an associate

518

Group's loss before tax

(1,651,474)

For the year ended 31 December 2019

Property

development

Reportable

Trading and

and

Solar

Financial

segments'

All other

Printing

logistics

investments

photovoltaic

services

total

segments

Total

RMB'000

Segment revenue

Revenue from external customers

670,189

2,203,718

677,024

92,663

7,565

3,651,159

48,447

3,699,606

Segment profit (loss)

6,492

(32,370)

154,309

(44,006)

1,701

86,126

(25,263)

60,863

Unallocated amounts

Change in fair value of convertible bonds

- derivative component

12,498

Corporate administrative expenses

(65,785)

Corporate other income

133

Finance costs

(572,252)

Gain on disposal of subsidiaries

Other gains and losses

652

Share of profit from an associate

813

Share of loss from joint venture

(216)

Group's loss before tax

(563,283)

Segment results represent the profit or loss of each operating segment without allocation of gains or losses arising from change in fair value of convertible bonds - derivative component, corporate administrative expenses, corporate other income, finance costs, gain on disposal of subsidiaries, unallocated other gains and losses and share of profit from an associate. This is the measure reported to the CODM for the purposes of resource allocation and performance assessment.

Other segment information

For the year ended 31 December 2020

					Property
					development					Reportable
			Trading and	and	Solar	Financial	segments'	All other
	Printing	logistics	investments	photovoltaic	services	total	segments	Unallocated	Total
	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000
Amounts included in the measure of
segment profit or loss or
segment assets:
Depreciation of property, plant and
equipment for the year	33,218		7,337	19,751	26,359	286	86,951	14,483	1,296	102,730
Depreciation of right of use assets
for the year	10,037		11,611	1,226	1,560	22	24,456	6,355	16,921	47,732
Additions to non-current assets during
the year	109,590		2,029	195,171	222,533	10	529,333	392,470	309	922,112
Additions to non-current assets through
acquisition of subsidiaries during the year	-	-	12	-	-	12	-	-	12
Impairment of goodwill	-	-	-	-	8,087	8,087	-	-	8,087
Impairment loss recognised in respect of
- trade receivables	1,598		-	-	12,300	-	13,898	-	-	13,898
- other receivables	-	-	73,807	-	1,051	74,858	-	-	74,858
- loan and interest receivables	-	-	-	-	11,525	11,525	-	-	11,525
- property, plant and equipment	20,269	-	-	87,472	-	107,741	6,625	-	114,366
Loss (gain) on disposal of property,
plant and equipment	172		-	(336)	(268)	21	(411)	243	(140)	(308)
Fair value loss of investment properties	-	-	175,975	-	-	175,975	-	-	175,975
Fair value gain of financial assets at FVTPL	-	(231)	-	-	(705)	(936)	-	-	(936)
Gain on disposal of debt instruments
at FVTOCI	-	-	-	-	(1,142)	(1,142)	-	-	(1,142)
Interest income on bank deposits and
pledged bank deposits	(233)	(924)	(216)	-	(2,717)	(4,090)	(4,451)	(351)	(8,892)
Interest income from finance lease
receivables	-	-	-	-	(616)	(616)	-	-	(616)
Interest income from loan receivables	-	-	-	-	(2,534)	(2,534)	-	-	(2,534)
Provision for litigation	-	-	31,574	-	-	31,574	-	-	31,574
Write-down of properties held for sale	-	-	117,345	-	-	117,345	-	-	117,345

For the year ended 31 December 2019

						Property
						development					Reportable
				Trading and	and	Solar	Financial	segments'		All other
		Printing	logistics	investments	photovoltaic	services	total		segments	Unallocated	Total
		RMB'000	RMB'000	RMB'000	RMB'000	RMB'000	RMB'000		RMB'000	RMB'000	RMB'000
	Amounts included in the measure of
	segment profit or loss or
	segment assets:
	Depreciation of property, plant and
	equipment for the year	30,654		8,270	17,552	22,815	440	79,731	5,208		2,071	87,010
	Depreciation of right of use assets
	for the year	10,231		10,620	1,511	711	-	23,073	3,280		18,270	44,623
	Additions to non-current assets during
	the year	143,661		320,096	742,984	37,624	472	1,244,837	226,379		4,311	1,475,527
	Additions to non-current assets through
	acquisition of subsidiaries during the year	-	-	65	-	-	65	337,696		-	337,761
	Impairment loss of
	- trade receivables	9,350	-	2,739	10,184	-	22,273	4,769		-	27,042
	- other receivables	-	-	11,712	-	-	11,712			-	-	11,712
	Written off of other receivables	-	530	7,859	-	-	8,389			-	5	8,394
	Loss on disposal of property,
	plant and equipment	901		852	-	-	-	1,753			-	-	1,753
	Gain on disposal of a right-of-use asset	(127)	-	-	-	-	(127)			-	-	(127)
	Fair value gain of investment properties	-	-	(237,945)	-	-	(237,945)			-	-	(237,945)
	Loss (gain) in fair value of financial assets
	at FVTPL	-	540	-	-	(9,159)	(8,619)			-	-	(8,619)
	Loss on disposal of debt instruments
	at FVTOCI	-	(1,499)	-	-	3,313	1,814			-	-	1,814
	Interest income on bank deposits and
	pledged bank deposits	(178)	(595)	(357)	(24)	(4,172)	(5,326)	(17)		(304)	(5,647)
	Interest income from finance lease
	receivables	-	-	-	-	(127)	(127)			-	-	(127)
	Interest income from loan receivables	-	-	-	-	(2,064)	(2,064)			-	-	(2,064)
	Write-down of inventories	9,004	-	-	-	-	9,004			-	-	9,004


6.	OTHER GAINS AND LOSSES
														2020				2019
												RMB'000	RMB'000
	Change in fair value of financial assets at FVTPL							936						8,619
	Exchange loss, net													(1,721)			(2,794)
	Gain (loss) on disposal of property, plant and equipment					308						(1,753)
	Gain (loss) on disposal of debt instruments at FVTOCI							1,142						(1,814)
	Gain on bargain purchase														-	5,791

														665				8,049

7.	OTHER INCOME
		2020	2019
		RMB'000		RMB'000
	Interest income on bank deposits and pledged bank deposits	8,892	5,647
	Gain on disposal of a right-of-use asset	-	127
	Government subsidiaries (note a)	4,005		-
	Agency fee income (note b)	27,038		-
	Others	25,078	10,803

		65,013	16,577
	Notes:

During the current year, the amounts represented cash subsidies from the Employment Support Scheme ("ESS") by the Government of the Hong Kong Special Administrative Region as part of the relief measures on COVID-19 pandemic. The subsidy income from ESS covers the period from June 2020 to August 2020 and from September 2020 to November 2020. There is no unfulfilled condition in relation to the recognition of the subsidy income and therefore the full amount was recognised as income during the year ended 31 December 2020.
During the current year, the amounts represented an one-off agency fee income from the procurement of a parcel of land and buildings located in the PRC on behalf of a third party.

8. FINANCE COSTS

	2020	2019
	RMB'000	RMB'000
Interest on bank borrowings and other borrowings	1,060,814		421,158
Interest on lease liabilities	6,065		6,160
Interest on significant financing component arising
from pre-sales of properties	-	90,853
Imputed interest arising on interest-free borrowings
from immediate holding company	2,346		146,680
Imputed interest arising on obligations under financing arrangements	-	45,002
Effective interest expenses on convertible bonds	125,986		66,844
Effective interest expenses on corporate bonds	8,407		16,590
Other finance charges	22,019		401

	1,225,637		793,688
Less: interest expenses capitalised into investment properties
under construction/properties under development for
sales/construction-in-progress	(326,929)	(221,436)

	898,708		572,252

9. INCOME TAX (CREDIT) EXPENSE

	2020		2019
	RMB'000	RMB'000
Current tax:
Hong Kong Profits Tax	-	6,295
PRC enterprise income tax	4,057	2,103
PRC land appreciation tax	17,663	10,098
Other jurisdictions	351	1

	22,071		18,497
Over-provision in prior periods:

Hong Kong Profits Tax	-	(114)
PRC enterprise income tax	(1,558)	628

	(1,558)	514

Deferred taxation	(42,143)	51,461

	(21,630)	70,472

Hong Kong profits tax is calculated at a flat rate of 16.5% of the estimated assessable profits for the current and prior years.

Under the Law of the PRC on Enterprise Income Tax (the "EIT Law") and Implementation Regulation of the EIT Law, the tax rate of the PRC subsidiaries is 25% for the current and prior years.

Taxation arising in other jurisdictions is calculated at the rates prevailing in the relevant jurisdictions.

Land appreciation tax in the PRC is levied on properties developed by the Group for sale, at progressive rates ranging from 30% to 60% on the appreciation of land value, which under the applicable regulations is calculated based on the proceeds of sales of properties less deductible expenditures including cost of land use rights, borrowing costs and all property development expenditures.

10,	LOSS FOR THE YEAR
		2020		2019
		RMB'000	RMB'000
	Loss for the year is arrived after charging (crediting):
	Directors' remuneration	11,080		14,680
	Staff cost, excluding Directors' remuneration:
	Salaries, wages and other benefits	246,384		257,364
	Retirement benefit scheme contributions	14,271		36,072

	Total staff costs	271,735		308,116
	Rental income from investment properties:

	Gross rental income from investment properties	(14,069)	(9,615)
	Less: direct operating expenses incurred for investment properties
	that generated rental income during the year	1,165		710

		(12,904)	(8,905)
	Auditor's remuneration

	- Audit services	3,251		5,056
	- Non-audit services	24		192
	Provision for litigation	31,574		-
	Cost of inventories recognised as an expense	2,584,788		2,798,954
	Cost of properties recognised as an expense	772,353		572,106
	Write-down of properties held for sales (included in cost of sales
	and services)	117,345		-
	Write-down of inventories (included in cost of sales and services)	-	9,004
	Written off of other receivables (included in administrative expenses)	-	8,394
	Depreciation for property, plant and equipment	102,730		87,010
	Depreciation for right-of-use assets	47,732		44,623
	Research and development expenses	9,280		3,715

11. LOSS PER SHARE

The calculation of the basic and diluted loss per share attributable to shareholders of the Company is based on the following data:

	2020		2019
	RMB'000	RMB'000
Loss
Loss for the purposes of basic and diluted loss per share
(loss for the year attributable to shareholders of the Company)	(1,573,818)	(644,710)


	2020		2019
Number of shares
Weighted average number of shares for the purposes of basic and
diluted loss per share	61,543,075		60,891,859

The computation of diluted loss per share does not assume the conversion of the Company's outstanding convertible bonds since their assumed conversion would have anti-dilutive impact for both years.

The computation of diluted loss per share does not assume the exercise of the Company's share options because the exercise price of those options was higher than the average market price for shares for both years.

12. TRADE AND OTHER RECEIVABLES, DEPOSITS AND PREPAYMENTS

The following is an aged analysis of trade receivables, net of allowance for credit losses, presented based on the invoice date which approximates the respective revenue recognition date, at the end of the reporting period.

		2020	2019
		RMB'000		RMB'000
0 - 30 days	153,206	167,523
31	- 90 days	57,570	35,914
91	- 180 days	26,936	17,917
Over 180 days	10,428	21,345

		248,140	242,699

13. LOAN AND INTEREST RECEIVABLES

	2020		2019
	RMB'000	RMB'000
Loan receivables	10,000		14,464
Interest receivables	1,525		540

	11,525		15,004
Less: allowance for impairment	(11,525)	-

	-	15,004

The Group's loan receivables, which arise from the money lending business of providing personal loans and corporate loans in the PRC, are denominated in RMB.

14. TRADE AND OTHER PAYABLES, AND OTHER LIABILITIES

The following is an aged analysis of trade payables and construction payables based on the invoice date at the end of the reporting period.

		2020	2019
		RMB'000		RMB'000
0 - 30 days	243,480	134,688
31	- 90 days	39,821	33,045
91	- 365 days	194,937	184,415
Over 365 days	94,454	34,368

		572,692	386,516

15.	BORROWINGS
		2020		2019
		RMB'000	RMB'000
	Bank borrowings	4,248,341		3,879,270
	Other borrowings from financial institutions	5,687,000		5,997,000
	Other borrowings from non-controlling shareholders	274,607		296,147

		10,209,948		10,172,417


	Secured	9,904,341		9,772,820
	Unsecured	305,607		399,597

		10,209,948		10,172,417
	Carrying amount repayable based on repayment schedule:


	Within one year	9,084,328		4,266,637
	More than one year but not more than two years	1,125,620		4,781,960
	More than two years but not more than five years	-	1,123,820

		10,209,948		10,172,417
	Less: carrying amount repayable within one year and do not contain

	a repayable on demand clause	(9,084,328)	(4,266,637)

	Amounts shown under current liabilities	(9,084,328)	(4,266,637)

	Amounts shown under non-current liabilities	1,125,620		5,905,780

The exposure of the Group's borrowings and the contractual maturity dates (or reset dates) are as follows:

	2020	2019
	RMB'000	RMB'000
Variable-rate borrowings:
Within one year	296,607		328,147
Fixed-rate borrowings
Within one year	8,787,721		3,938,490
In more than one year but not more than two years	1,125,620		4,781,960
In more than two years but not more than five years	-	1,123,820

	9,913,341		9,844,270

The ranges of effective interest rates (which are also equal to contracted interest rates) on the Group's borrowings are as follows:

	2020	2019
	RMB'000		RMB'000
Effective interest rate:
- Fixed-rate borrowings	4.4% - 12.0%		4.4% - 12.0%
- Variable-rate borrowings	2.5% - 3.0%		1.5% - 3.0%

In respect of a bank borrowing with an outstanding principal amount of RMB157,000,000 (2019: RMB157,000,000) as at 31 December 2020, the Group breached the repayment terms of which approximately RMB182,682,000 was in default since November 2019. The relevant bank borrowing is an entrusted loan entrusted by Shanghai Linyi Investment Partnership (Limited Partnership)* ("Shanghai Linyi") made available to Baohua Properties (Jiangsu) Co., Ltd.* ("Baohua Jiangsu"), a 80% owned subsidiary of the Group. On 25 December 2019, Shanghai Linyi issued a legal letter to Baohua Jiangsu to demand for the outstanding principal, interest of approximately RMB182,682,000 and RMB3,040,000 respectively plus penalty interest at a daily rate of 0.1% since 9 November 2019. On 31 December 2019, Baohua Jiangsu made partial repayment of the principal of approximately RMB25,682,000.
On 7 January 2020, Shanghai Linyi further filed a claim to Shanghai Financial Court* against Baohua Jiangsu, Huajun Properties (Yangzhou) Co., Ltd.* (formerly known as Yangzhou Baohua Properties Limited*) ("Huajun Properties Yangzhou"), the Company and Mr. Meng for the outstanding principal of approximately RMB169,539,000 as at 31 December 2019 plus penalty interest at a daily rate of 0.1% since 31 December 2019. On 10 September 2020, Shanghai Financial Court handed down a judgement in favour of Shanghai Linyi and demanded immediate repayment from Baohua Jiangsu but concluded that the outstanding principal was RMB157,000,000 and unpaid interest of RMB3,040,000. Penalty interest shall be calculated at an annual rate of 24% since 9 November 2019. On 30 September 2020, Baohua Jiangsu filed an appeal to the Shanghai High Court against the interest rate determined by the Shanghai Finacial Court. Up to the date of this announcement, the hearing date of the appeal is yet to be determined.
As at 31 December 2020, the entire outstanding bank borrowing of RMB157,000,000 (2019: RMB157,000,000) was classified as current liabilities and outstanding interest of RMB3,040,000 and provision for penalty interest of approximately RMB44,763,000 (2019: RMB12,539,000) based on an interest rate at 24% per annum were included under other payables.

In respect of a borrowing with an outstanding principal of RMB1,440,000,000 (2019: RMB1,440,000,000) as at 31 December 2020, the Group breached the repayment terms of which the loan principal of RMB240,000,000 was in default since 27 March 2020. The loan was granted by China Great Wall Asset Management Co., Ltd. - Shanghai Branch ("China Great Wall") to Baohua Properties Development (Shanghai) Co., Ltd* (formerly known as Shanghai Baohua Wanlong Real Estate Co., Ltd.) ("Baohua Shanghai"), a wholly-owned subsidiary of the Company. The borrowing was secured bv the shares of Baohua Real Estate (Dalian) Co., Ltd. ("Baohua Real Estate Dalian") and guaranteed by the Company, Huajun Holdings Group Co., Ltd. (a company controlled by Mr. Meng), Mr. Meng and his spouse (together referred to as the "Guarantors"). Pursuant to the terms of the loan agreement, China Great Wall had a discretionary right to demand immediate full repayment of the outstanding principal of RMB1,440,000,000 together with any unpaid interest. On 28 April 2020, Baohua Shanghai has obtained a written consent from China Great Wall to extend the repayment date of the principals of RMB240,000,000, RMB240,000,000 and RMB960,000,000 from March 2020, June 2020 and September 2020 respectively to March 2022, June 2022 and September 2022 respectively.
On 2 November 2020, the Group received a notice dated 30 October 2020 from the Shanghai Huangpu Notary Public Office ("Shanghai Notary Office") (the "Notice"), stating that the lender has applied for the issuance of execution certificate (the "Execution Certificate") to the Group due to the alleged failure of Baohua Shanghai to repay the loan within the specified period. According to the Notice, Baohua Shanghai has the right to object to the issuance of the Execution Certificate within five days after receiving the Notice. On 5 November 2020, Baohua Shanghai submitted an objection letter against the issuance of the Execution Certificate to Shanghai Notary Office. On 28 December 2020, Baohua Shanghai received a second notice dated 23 November 2020 from Shanghai Notary Office, which stated that Baohua Shanghai's objection against the issuance of the Execution Certificate was not accepted. Baohua Shanghai received further notices from Shanghai Notary Office dated 25 December 2020 and 8 January 2021 respectively in repect of amendments to the computation of compound interest, penalty interest and damages from the default of borrowings. On 11 January 2021, the Execution Certificate was issued by Shanghai Notary Office, pursuant to which China Great Wall can use the Execution Certificate for application to the relevant courts of the PRC for enforcement. According to the Execution Certificate, the total interest including normal interest, penalty interest, compound interest and damages shall not exceed 24% per annum. On 5 February 2021, the Shanghai Financial Court issued a notice of execution against Baohua Shanghai, pursuant to which Baohua Shanghai was ordered to pay the outstanding balance of the borrowing plus interest to China Great Wall. On the same date, the Shanghai Financial Court also issued an asset report order against Baohua Shanghai, Baohua Real Estate Dalian and the Guarantors pursuant to which the Guarantors are required to report their assets and relevant financial information to the court.
One of the Guarantors, Huajun Holdings Group Co., Ltd., has submitted an application for non- enforcement to the Shanghai Financial Court in accordance with the law, and is waiting for the court to decide whether to terminate the enforcement. The Company is currently seeking legal advice on the enforcement. As at 31 December 2020, the entire outstanding borrowing of RMB1,440,000,000 (2019: RMB1,440,000,000) was classified as current liabilities and outstanding interest, penalty interest, compound interest and damages of approximately RMB209,581,000 (2019: nil) were included under other payables.

In respect of a borrowing with an outstanding principal of RMB32,000,000 (2019: RMB32,000,000), the Group breached the repayment terms of which the entire loan principal of RMB32,000,000 was in default since 8 June 2020. The loan was granted by Zheshang Bank Co., Ltd ("Zheshang Bank") to Shenzhen Huajun Financial Leasing Co., Ltd* ("Shenzhen Huajun Financial Leasing"), a 70% owned subsidiary of the Company.
On 10 July 2020, Zheshang Bank filed a claim to Shenzhen Futian District People's Court* against Shenzhen Huajun Financial Leasing for the outstanding principal of RMB32,000,000 plus unpaid interest (including penalty interest and additional interest) of approximately RMB332,000. The hearing of the claim was held on 16 September 2020. On 3 December 2020, Shenzhen Futian District People's Court handed down a judgement to demand Shenzhen Huajun Financial Leasing to repay the outstanding principal and interest (including penalty interest and compound interest) of approximately RMB32,000,000 and RMB1,320,000 accumulated up to 19 November 2020. Thereafter, penalty interest and compound interest shall be calculated at 8.34% per annum. On 30 December 2020, Shenzhen Huajun Financial Leasing filed an appeal to the Guangdong, Shenzhen Intermediate People's Court against the interest rate determined by the Shenzhen Futian Distrct People's Court.
As at 31 December 2020, the entire outstanding bank borrowing of RMB32,000,000 (2019: RMB32,000,000) was classified as current liabilities and outstanding interest of approximately RMB108,000 and penalty interest and compound interest of approximately RMB1,952,000 based on the judgement rate at 8.34% per annum (2019: nil) were included under other payables.
In respect of a borrowing with an outstanding principal of RMB199,659,000 (2019: RMB199,659,000), the Group breached the repayment terms of which the entire loan principal of RMB199,659,000 was in default since 10 August 2020. The loan was granted by Jiangsu Jiangnan Rural Commercial Bank Co., Ltd.* ("Jiangnan Rural Bank") to Huajun Properties (Changzhou) Company Limited* ("Huajun Changzhou"), a wholly-owned subsidiary of the Company.
In October 2020, Jiangnan Rural Bank filed several claims to Changzhou Intermediate Court* against Huajun Changzhou. The first hearing for claims are scheduled to be held on 22 December 2021 and on 10 January 2022.
As at 31 December 2020, the entire outstanding bank borrowing of approximately RMB199,659,000 (2019: RMB199,659,000) was classified as current liabilities and outstanding interest, penalty interest and compound interest of approximately RMB8,194,000 (2019: nil) were included under other payables.
In respect of a borrowing with an outstanding principal of RMB4,247,000,000 (2019: RMB4,247,000,000), there were interest payments of RMB193,191,000 and RMB192,141,000 which was due on 22 June 2020 and 23 December 2020 respectively. The loan was granted by a financial institution in the PRC to Huajun Property (Wuxi) Co., Ltd.* ("Huajun Wuxi"), a wholly-owned subsidiary of the Company. Pursuant to the terms of the loan agreement, the counterparty had a discretionary right to demand immediate full repayment of the outstanding principal of RMB4,247,000,000 together with any unpaid interest.
As at 31 December 2020, the entire outstanding principal of RMB4,247,000,000 (2019: RMB4,247,000,000) was classified as current liabilities and outstanding interest of approximately RMB385,332,000 (2019: nil) and penalty interest of approximately RMB14,353,000 (2019: nil) based on contractual terms was included under other payables. The Group is currently negotiating with the lender for extension of repayment of such outstanding amount and no legal claims have been issued by the lender.

In respect of a borrowing with an outstanding principal of RMB300,000,000 (2019: nil), which was due on 17 December 2020. The loan was granted by Yingkou Coastal Bank Co., Ltd ("Yingkou Coastal Bank") to Huajun Properties (Dalian) Company Limited ("Huajun Properties (Dalian)"), a wholly- owned subsidiary of the Company. Pursuant to the terms of the loan agreement, the counterparty had a discretionary right to demand immediate full repayment of the outstanding principal of RMB300,000,000 together with any unpaid interest.
As at 31 December 2020, the entire outstanding bank borrowing of RMB300,000,000 was classified as current liabilities and outstanding interest of RMB4,650,000 (2019: nil) and penalty interest of RMB1,050,000 (2019: nil) based on contractual terms was included under other payables. The Group is currently negotiating with Yingkou Coastal Bank for refinancing arrangement of such borrowings and no legal claims have been issued by Yingkou Coastal Bank.
Subsequent to the end of the reporting period, the Group has several tranches of borrowings from Yingkou Coastal Bank of which an aggregate loan principals of RMB1,026,310,000 due in March 2021. Pursuant to the terms of the loan agreements, the counterparty had a discretionary right to demand immediate full repayment of the outstanding principals of RMB1,026,310,000 together with any unpaid interest.
As at 31 December 2020, the entire outstanding bank borrowings of RMB1,026,310,000 was classified as current liabilities. The Group is currently negotiating with Yingkou Coastal Bank for refinancing arrangement of such borrowings and no legal claims have been issued by Yingkou Coastal Bank.

Subsequent to the end of the reporting period, the Group has obtained a letter of intent for new banking facilities of approximately RMB2,658.8 million issued by Yingkou Coastal Bank. The Group is expected to utilise such banking facilities to refinance the loan principal of RMB300,000,000 as disclosed in note 15(f) and the borrowings due in March 2021.

16.	SHARE CAPITAL
		Number of shares		Share capital
		2020	2019	2020	2019
		'000		'000		HK$'000	HK$'000
	Ordinary shares
	Authorised:
	Ordinary shares of HK$1.00 each
	At the beginning and end of
	the reporting year	400,000	400,000	400,000	400,000


		'000		'000		RMB'000	RMB'000
	Issued and fully paid:
	At the beginning of the reporting year	61,543	60,669	55,983	55,203
	Issue of shares	-	874		-	780

	At the end of the reporting year	61,543	61,543	55,983	55,983

17. EVENTS AFTER THE REPORTING PERIOD

Except as disclosed in note 15, there are no other material events after the reporting period.

BUSINESS REVIEW

Our Group has engaged in five core businesses, namely (i) Printing; (ii) Trading and Logistics; (iii) Property Development and Investments; (iv) Solar Photovoltaic; and (v) Financial Services.

Our strategy is to strengthen our foundation, better diversify our business portfolio, and continue to grow, both organically and through strategic acquisitions. We believe that this strategy will increase our shareholders value by creating an even stronger Huajun.

For the year ended 31 December 2020 (the "Current Year"), revenue was approximately RMB3,515.5 million, representing a decrease of approximately RMB184.1 million, or 5.0%, compared to revenue of approximately RMB3,699.6 million for the year ended 31 December 2019 (the "Last Year"). The overall decrease in revenue was attributable to the decrease in revenue generated from Printing and Trading and Logistics. The decrease in sale in Printing and Trading and Logistics business is mainly due to decrease in sales orders as a result of COVID-19 outbreak which lead to uncertain macroeconomic environment and poor consumption appetite. The logistics disruption in supply chain in the PRC in the first quarter of 2020 due to COVID-19 also adversely impact on trading and logistics businesses of our petrochemical products. The decreases were partially offset with the increase in revenue from Property Development and Investments business since the Group recognised revenue from sale of properties upon delivery of certain completed property units to customers during the Current Year.

For the Current Year, our Group generated most of its revenue from Trading and Logistics segment which accounted for approximately 58.3% (Last Year: approximately 59.6%) of the total revenue followed by property development and investments segment which accounted for approximately 22.8% (Last Year: approximately 18.3%) of the total revenue. For the Current Year, local PRC sales continued to be our major source of revenue, representing approximately 92.0% (Last Year: 86.9%) of the total revenue.

The table below sets forth our Group's revenue by business segment for the Current Year and the Last Year:

	For the year ended		For the year ended
	31 December 2020			31 December 2019
	RMB Million	%		RMB Million	%
Printing	440.5			12.5%	670.2	18.1%
Trading and logistics	2,050.7			58.3%	2,203.7	59.6%
Property development and investments	802.7			22.8%	677.0	18.3%
Solar photovoltaic	109.5			3.1%	92.7	2.5%
Financial services	4.9			0.1%	7.6	0.2%
Other	107.2			3.2%	48.4	1.3%

	3,515.5			100%	3,699.6	100.0%

The table below sets forth our Group's revenue by geographical locations based on the location by customers for the Current Year and the Last Year:

	For the year ended	For the year ended
	31 December 2020		31 December 2019
	RMB Million	%	RMB Million	%
The PRC	3,233.8		92.0%		3,213.7		86.9%
The United States	136.9		3.9%		277.8		7.5%
Hong Kong	39.7		1.1%		58.0		1.6%
European countries	44.8		1.3%		79.7		2.2%
Other countries	60.3		1.7%		70.4		1.8%

	3,515.5		100%	3,699.6		100%

Set out below are details of the financial and trading prospects of the core business segments of the Group:

Printing

New Island Printing Group Company Limited (formerly known as New Island Printing Company Limited) ("New Island") is one of the leading and reputable printing and packaging companies in Hong Kong and the PRC. New Island produces high quality packaging and paper products with the capability to serve our international clients in the areas of beauty and cosmetics, pharmaceutical, food and beverage globally.

Due to the outbreak of COVID-19 during the year, the revenue of printing products decreased significantly, in particular for sales to oversea markets where were suffered from lockdown of community.

Trading and logistics

This segment is principally engaged in the distribution and sales of petrochemical products and provision of logistics services. This segment trades a large spectrum of petrochemical products. The Group expects vast demand of petrochemical products in Hong Kong and the PRC and with our strength of strong network of suppliers ensure stable supply of products managed by our team. All of our customers for petrochemical products are located in the PRC and the sales have gradually recovered in the second half of 2020 as the situation of COVID-19 in the PRC has been under control.

Property development and investments

This segment consists of land consolidation and development, property development and sales, property leasing and management, and various real estate business. Leveraging on the rich resources in the PRC, the Group seeks to invest on development projects with asset appreciation potential for investment and enjoys asset appreciation while generating stable revenue. There are several core projects held by the Group and under development during the Current Year as follows:

Shanghai Huajun Plaza

Bao Hua Property Development (Shanghai) Company Limited*（保華房地產開發（上海）有限

公司）(formerly known as Shanghai Baohua Wanlong Real Estates Company Limited*（上海保華萬隆置業有限公司）), an indirectly wholly-owned subsidiary of the Company, successfully

bid for the land use rights of the land in Minhang District, Shanghai, the PRC through the auction

held by Shanghai Minhang District Planning and Land Administration Bureau*（上海市閔行區規劃和土地管理局）offered for sale by way of tender at a bidding price of RMB2,305 million.

The land is under development and will offer commercial and office complex named Shanghai Huajun Plaza*（上海華君廣場）(formerly known as Shanghai Bao Hua International Plaza*（上海保華國際廣場）) with total gross floor area ("GFA") of approximately 125,000 square metres.

We have obtained the pre-sale certificate in January 2020, 40% of the office properties would be sold and the remaining office and commercial properties will be held for long term investment purpose to generate rental income.

Dalian Projects

Two property projects named Dalian Huajun Plaza*（大連華君廣場）(formerly known as Bao Hua Financial Centre*（保華金融中心）) and Bao Hua Wang Yuan*（保華旺苑）are located

in Dalian City, Liaoning Province, the PRC. In particular, Dalian Huajun Plaza comprises a parcel of land with a site area of approximately 10,857.10 square meters situated at Xinghai Bay Business Area, Dalian City, the PRC. It is under development into a commercial and Grade A office development complex with total GFA of approximately 146,000 square meters to be erected thereon. The development will be developed into a 51-storey commercial and office complex with a 2-storey basement for car parking and ancillary uses.

Property for sale - Gaoyou

A commercial and residential project named Gaoyou Huafu Renjia（高郵華府人家）(formerly known as Gaoyou Bao Hua - Jun Ting*（高郵保華．君庭）) with two phases and has a total

sellable GFA of approximately 365,000 square meters located in Gaoyou City, Jiangsu Province, the PRC. First phase of the project has been completed and gradually handover to customers since the first quarter of 2020.

Property for sale - Wuxi Project

In 6 July 2018, the Group completed the acquisitions of (i) the entire equity interests in Huajun Real Estate (Wuxi) Co., Ltd.*（華君地產（無錫）有限公司）(formerly known as Baohua Real Estate (Wuxi) Co., Ltd.*（保華地產（無錫）有限公司）and Wuxi Huiling Real Estate Co., Ltd.* （無錫惠靈置業有限公司）); (ii) the entire equity interests in Wuxi Huiyuan Real Estate Co., Ltd.*（無錫市惠遠置業有限公司）("Wuxi Huiyuan"); and (iii) 55% equity interests in Wuxi Huize Real Estate Co., Ltd.*（無錫惠澤置業有限公司）(now known as Huajun Real Estate (Jiangyin) Co., Ltd.（華君地產（江陰）有限公司）)("Wuxi Huize") for a total consideration

of RMB1,311.29 million, RMB291.95 million and RMB280.50 million respectively (collectively "Wuxi Project"). The Group further acquired 15% equity interests in Wuxi Huize in November 2018 at consideration of RMB76.5 million. The Group is in progress in acquiring the remaining 30% equity interests in and debt of Wuxi Huize at aggregate consideration of approximately RMB154.2 million. For details of acquisition, please refer to the circular of the Company dated

26 March 2020. Wuxi Project comprises:

a completed building known as Wuai Renjia（五愛人家）located at Liangxi District, Wuxi City in the PRC with a 13-storey complex building for residential, office and retail purposes with total saleable/lettable area of approximately 20,000 square meters. On 31 July 2020, the Group has disposed of the entire equity interests in Wuxi Huiyuan, which including its principal assets, Wuai Renjia.
A residential development named as Zangpin Yuyuan（藏品裕苑）located at Jiangyin District, Wuxi City in the PRC with parcel of land with a site area of approximately 109,000 square metres, and a total of 4 phases of various residential and ancillary facilities which have been developed.
A parcel of land located at Binhu District, Wuxi City in the PRC with site area of
approximately 163,000 square meters for residential development with project named Huajun Lake Bay Garden（華君湖灣花園）.

We have sold/pre-sale certain properties of Wuxi Project and have recognised revenue of approximately RMB540.6 million from the Wuxi Project during the Current Year.

Solar photovoltaic

The Group's production of solar products is located in Jiangsu Province in the PRC. To grasp the opportunity for growing trend of solar photovoltaic industry, during the Current Year, the Group sought to further expand the solar photovoltaic business and is in progress in acquiring certain properties and equipment relating to the production and manufacturing of photovoltaic related products. For details of the acquisition, please refer to the circular of the Company dated 5 November 2020.

Finance services

Finance Lease

This segment consists of the leasing of land, property, plant and equipment, and other tangible assets. The operations of this segment is mainly located in the PRC where the Group seeks stable revenue with controllable risk.

Provision of Finance

The Group provides finance to prospective customers who would provide securities for the performance of their respective obligations to repay the Group. The Group will take a prudence approach to develop this business segment, diversify the customer portfolio and seek opportunity to cooperate with its business partners.

(iii) Securities Investments

The Group invests in Hong Kong and overseas securities. We mainly utilise the extensive investment experience of the management to make medium and short-term investments by searching for stable revenue with controllable risk, diversifying the corporate operating risk and improving asset liquidity of the Group.

(iv) Securities brokerage and assets management

The Group has a licensed corporation which is licensed to carry out Type 1 (dealing in securities), Type 4 (advising on securities) and Type 9 (asset management) regulated activities under the Securities and Futures Ordinance (Chapter 571) of the laws of Hong Kong) ("SFO").

FINANCIAL REVIEW

Revenue

Our Group's revenue for the Current Year was approximately RMB3,515.5 million, representing a decrease of approximately RMB184.1 million, or 5.0%, compared to revenue of approximately RMB3,699.6 million for the Last Year. For the Current Year, our Group's major business segments, namely (1) Printing reported a revenue of approximately RMB440.5 million (Last Year: approximately RMB670.2 million); (2) Trading and Logistics reported a revenue of approximately RMB2,050.7 million (Last Year: approximately RMB2,203.7 million); (3) Solar Photovoltaic recorded revenue of approximately RMB109.5 million (Last Year: approximately RMB92.7 million); (4) Property Development and Investments reported a revenue of approximately RMB802.7 million (Last Year: approximately RMB677.0 million); and (5) Financial Services recorded a revenue of approximately RMB4.9 million (Last Year: approximately RMB7.6 million). We also recorded revenue of approximately RMB69.6 million from sales of hydraulic machinery

during the Current Year (Last year: RMB20.9 million) since we acquired Dalian Hydraulic Machinery Co., Limited*（大連液力機械有限公司）on 30 September 2019.

The overall decrease in revenue was attributable to the decrease in revenue generated from Printing and Trading and Logistics. The decrease in sale in Printing and Trading and Logistics business is mainly due to decrease in sales orders as a result of COVID-19 outbreak which lead to uncertain macroeconomic environment and poor consumption appetite. The logistics disruption in supply chain in the PRC in the first quarter of 2020 due to COVID-19 also adversely impact on trading and logistics businesses of our petrochemical products. The decreases were partially offset with the increase in revenue from Property Development and Investments business since the Group recognised revenue from sale of properties upon delivery of certain completed property projects to customers during the Current Year.

Gross profit and gross profit margin

Gross profit was approximately RMB40.9 million for the Current Year (Last Year: approximately

RMB304.2 million), with gross profit margin of approximately 1.2% (Last Year: approximately 8.2%). The decrease was mainly due to decrease in gross profit of Property Development and Investment business and Printing as a result of COVID-19 outbreak and poor consumption appetite. During the Current Year, the Group recognized provision for write down of properties held for sales of approximately of RMB117.3 million (Last year: Nil), leading to the decrease in gross profit and gross profit margin of the Group.

Selling and distribution expenses

For the Current Year, selling and distribution expenses decreased by approximately RMB17.8 million or 11.7% to approximately RMB134.2 million, or 3.8% of revenue for the Current Year, from approximately RMB152.0 million, or 4.1% of revenue for the Last Year. The decrease was primarily due to the decrease in commission expenses, consultancy fees and freight and insurance expenses.

Administrative expenses

For the Current Year, administrative expenses decreased by approximately RMB26.1 million or 6.9% to approximately RMB354.1 million or 10.1% of revenue of the Current Year, from approximately RMB380.2 million, or 10.3% of revenue for the Last Year, was due to a decrease in staff costs and other business tax expenses.

Finance costs

Finance costs for the Current Year was approximately RMB898.7 million (Last Year: approximately RMB572.3 million). The increase was primarily due to increase in the average loan balances and increase lead to interest expense on bank and other borrowings, the increase was also due to accrual for penalty interest and provision for liquidated damage for certain loan agreements as disclosed in note 15.

Change in fair value of investment properties

During the Current Year, the Group recorded loss on changes in fair value of investment properties of RMB176.0 million compared to a gain of RMB237.9 million in the Last Year as a result of the decrease in fair value of investment properties held by the Group as at 31 December 2020.

Impairment loss of property, plant and equipment

The Group conducted a review of the Group's property, plant and equipment and determined that a number of assets were impaired, primarily due to closure of certain production lines of solar photovoltaic products because of the change in technology and less orders for products produced by such production facilities. The Group also assess the recoverable amount of property, plant and equipment of other loss making units and recognised total impairment losses of approximately RMB114.4 million during the Current Year.

Loss for the year

As a combined effect of the above, during the Current Year, our Group recorded a loss attributable to shareholders of the Company of approximately RMB1,573.8 million, as compared to a loss of approximately RMB644.7 million for the Last Year.

Liquidity, financial resources and capital structure

Shareholders' funds

Total shareholders' funds amounted to approximately RMB1,116.1 million as at 31 December 2020, as compared to approximately RMB2,721.2 million as at 31 December 2019, representing a decrease of 59.0%.

Financial position

As at 31 December 2020, the Group had current assets of approximately RMB9,037.6 million (31 December 2019: approximately RMB9,292.8 million) comprising cash and cash equivalents of approximately RMB219.1 million (31 December 2019: approximately RMB270.8 million), and current liabilities of approximately RMB13,758.3 million (31 December 2019: approximately RMB7,798.2 million). The Group's current ratio (defined as current assets divided by current liabilities) was 0.7 (31 December 2019: 1.2).

Our gearing ratio, expressed as a percentage of interest-bearing liabilities to total assets, was at 65.3% as at 31 December 2020 as compared to 62.5% as at 31 December 2019.

Cash and cash equivalents

As at 31 December 2020, our Group had cash and cash equivalents of approximately RMB219.1 million (31 December 2019: approximately RMB270.8 million), most of which were denominated in Renminbi.

Borrowings

As at 31 December 2020, our Group had interest-bearing bank borrowings and other borrowings of approximately RMB10,209.9 million (31 December 2019: approximately RMB10,172.4 million). Of these borrowings, approximately RMB9,904.3 million (31 December 2019: approximately RMB9,772.8 million) were secured by the Group's assets. Most of the borrowings were denominated in Renminbi.

Capital expenditure

For the Current Year, the Group's capital expenditure mainly represents additions to investment properties, property, plant and equipment and right-of-use assets totaling of approximately RMB922.1 million (Last Year: approximately RMB1,475.5 million).

Pledge of assets

As at 31 December 2020, the Group's property, plant and equipment, right-of-use assets, property held for sale, investment properties, inventories, pledged bank deposits and restricted bank balances with carrying amounts of approximately RMB707.7 million, RMB267.0 million, RMB5,681.6 million, RMB5,104.5 million, RMB10.0 million, RMB46.9 million and RMB46.9 million, respectively, were pledged to secure certain banking and credit facilities of the Group.

FOREIGN EXCHANGE RISK MANAGEMENT

The Group is exposed to foreign currency risk on bank balances and cash, trade and other receivables, trade and other payables and borrowings that are denominated in currencies other than the functional currency of the operations to which they relate. The Directors ensure that the net exposure is kept to an acceptable level, by buying or selling foreign currencies at spot rates and entering into plain vanilla foreign exchange forward contracts where necessary to address short- term imbalances.

CONTINGENT LIABILITIES

As at 31 December 2020, the Group has several outstanding legal proceedings with construction contractors, customers, suppliers and joint venture partner that against the Group in the PRC in relation to the Group's property development and investment, printing and solar photovoltaic segment. Apart from disclosed below, the directors consider that all other legal proceedings would not have significant financial impact to the Group as the corresponding claims against the Group are either not significant or not probable to have a material financial impact to the Group, based on the advice of the legal counsel.

A cooperation agreement entered between the Group and an independent third party in June 2017 were not proceeded due to the failure to comply with certain urban renewal policies in Guangdong Province, the PRC and the relating project shall be terminated. Accordingly, the counterparty has raised a civil prosecution to Guangdong High Court against the Group regarding the breach of the cooperation agreement. The hearing was held on 29 March 2019 and a judgement was handed down by Guangdong High Court on 29 September 2019, requesting the Group to refund the deposit received of RMB50,000,000 and pay for damages of RMB80,000,000 to the counterparty. The Group filed an appeal to the Guangdong High Court and the hearing was held in October 2020. The appeal was rejected and the Group is still liable to refund the deposit of RMB50,000,000 and pay damages of RMB80,000,000. The Group has made a provision of RMB80,000,000 in respect of the damages in the financial statement. In December 2020, the Group has applied for retrial to the Supreme People's Court.
On 6 March 2018, the Group entered into three share transfer agreements with an independent third party for the transfer of equity interest of three property companies in Wuxi. The Group failed to pay the outstanding consideration and related interest on or before 12 March 2018. The counterparty raised a civil prosecution to the Jiangsu High Court against the Group on 20 April 2020. The hearing was held on 14 August 2020 and a judgement was handed down on 14 September 2020, requesting the Group to pay for damages of approximately RMB31,574,000 to the counterparty. The Group filed an appeal to Jiangsu High Court and the hearing was held on 25 March 2021 but judgement was not handed down yet. The Group has made a provision of RMB31,574,000 based on initial judgement handed down by the Jiangsu High Court.

STAFF

As at 31 December 2020, the Group had a total staff of 3,059 (31 December 2019: 3,541).

The Group provides employee benefits such as staff insurance, retirement schemes and discretionary bonus and also provides in-house training programmes and external training sponsorship.

MATERIAL ACQUISITIONS AND DISPOSALS OF SUBSIDIARIES

During the Current Year, the Group has carried out the following material acquisition and disposal of subsidiaries:

Huaren Real Estate

On 30 March 2020, Huajun Properties Group Limited*（華君地產集團有限公司）(formerly known as Baohua Properties (China) Limited*（保華地產（中國）有限公司）), an indirect

wholly-owned subsidiary of the Company, as vendor entered into a sale and purchase agreement

with an independent third party as purchaser to dispose of 100% equity interest in and the loan owed to the vendor by Huaren Real Estate (Huai'an) Co., Ltd*（華仁置業（淮安）有限公司）

("Huaren Real Estate") at the aggregate consideration of RMB252,110,000. The disposal was completed on 30 June 2020 and Huaren Real Estate ceased to be a subsidiary of the Company and the financial results of Huaren Real Estate are no longer consolidated into the Groups financial statements.

Dalian Henglifeng Project

On 5 June 2020, Huajun Department Store (Dalian) Co., Ltd.*（華君百貨（大連）有限公司）, an indirect wholly-owned subsidiary of the Company, as purchaser entered into a sale and purchase

agreement with a connected person of the Company as vendor to acquire the entire equity interest in and the debt owed to the vendor by Henglifeng Mall (Dalian) Co., Ltd.*（恒利豐商城（大連）

有限公司）at the aggregate consideration of RMB98,800,000, which shall be satisfied by issue of the Company's convertible bonds. The acquisition has not yet completed as at the date of this announcement.

Huajun Intelligent Energy

On 29 July 2020, Huajun Power Group Co., Ltd.*（華君電力集團有限公司）, an indirect wholly-owned subsidiary of the Company, as vendor entered into a sales and purchase agreement

with an independent third party as purchaser to dispose of 100% equity interest in and the debt owned to the vendor by Huajun Intelligent Energy Company Limited *（華君智慧能源有限公司）

("Huajun Intelligent Energy") at the aggregate consideration of RMB120,000,000. The disposal has completed on 3 August 2020 and Huajun Intelligent Energy ceased to be a subsidiary of the Company and its financial results are no longer consolidated into the Group financial statements.

Wuxi Huiyuan

On 31 July 2020, Baohua Real Estate Management (Yingkou) Co., Ltd.*（保華置業管理（營口）有限公司）, an indirect wholly-owned subsidiary of the Company, as vendor entered into a sales

and purchase agreement with an independent third party as purchaser to dispose of 100% equity interest and the paid-up capital of Wuxi Huiyuan Real Estate Co., Ltd.*（無錫市惠遠置業有限

公司）at the consideration of RMB127,000,000. The disposal has completed on 11 August 2020 and Wuxi Huiyuan ceased to be a subsidiary of the Company and its financial results are no longer consolidated into the Group's financial statement.

Save for those disclosed above, the Group did not have any other material acquisitions or disposals of subsidiaries during the Current Year.

CORPORATE GOVERNANCE

The Company has applied the principles and complied with the code provisions of the Code on Corporate Governance Practices (the "CG Code") contained in Appendix 14 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited ("Stock Exchange") (the "Listing Rules") for the year ended 31 December 2020, the Company has fully complied with the CG Code.

MODEL CODE FOR SECURITIES TRANSACTIONS BY DIRECTORS

The Company has adopted the Model Code for Securities Transactions by Directors ("Model Code") set out in Appendix 10 to the Listing Rules as the code of conduct regarding securities transactions by the Directors. Having made specific enquiry of all Directors, the Company confirmed that all Directors, have complied with the required standard set out in the Model Code throughout the Current Year.

AUDIT COMMITTEE

The audit committee comprises three Independent Non-executive Directors and reports directly to the Board. The audit committee meets regularly with the Group's senior management and the Company's external auditor to review the financial reporting and internal control systems of the Group as well as the financial statements of the Company. The audit committee has reviewed the audited annual results of the Group for the year ended 31 December 2020 as set out in this announcement.

PURCHASE, SALE OR REDEMPTION OF THE COMPANY'S SHARES

During the Current Year, the Company nor any of its subsidiaries has purchased, sold or redeemed any of the shares.

SIGNIFICANT EVENTS AFTER REPORTING PERIOD

Except as disclosed in note 17, the Group has no significant events after 31 December 2020.

DIVIDEND

The Board did not recommend the payment of a final dividend for the Current Year (the Last Year: Nil).

CLOSURE OF REGISTER OF MEMBERS FOR ANNUAL GENERAL MEETING

The Company will make appropriate announcements at a subsequent date and time to be confirmed.

EXTRACT FROM INDEPENDENT AUDITOR'S REPORT PREPARED BY THE INDEPENDENT AUDITOR

The Group would like to provide an extract from the independent auditor's report prepared by SHINEWING (HK) CPA Limited (the independent auditor) on the Group's annual financial statements for the year ended 31 December 2020 as set out below:

Disclaimer of Opinion

We do not express an opinion on the consolidated financial statements of the Group. Because of the significance of the matters described in the Basis for Disclaimer of Opinion section of our report, we have not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these consolidated financial statements. In all other respects, in our opinion, the consolidated financial statements have been properly prepared in compliance with the disclosure requirements of the Hong Kong Companies Ordinance.

Basis for Disclaimer of Opinion

Multiple Uncertainties Relating to Going Concern

As described in note 2 to the consolidated financial statements, the Group reported net loss of approximately RMB1,629,844,000 for the year ended 31 December 2020 and as at 31 December 2020, the Group had net current liabilities of approximately RMB4,720,691,000, which included principals and interest payables of the Group's certain borrowings that are in default and therefore the lenders have the right to demand immediate repayment of the entire outstanding balances as at 31 December 2020. Details of which are set out in note 2. As at the same date, the Group's cash and cash equivalents amounted to approximately RMB219,083,000 only. These conditions, together with other matters as described in note 2 to the consolidated financial statements, indicate the existence of material uncertainties which may cast significant doubt about the Group's ability to continue as a going concern.

The Directors have been undertaking a number of measures to improve the Group's liquidity and financial position, and to remediate the defaulted and delayed payments which are set out in note 2 to the consolidated financial statements, including partial repayment of defaulted principals and extension of defaulted loans. In addition, the Group has been in active negotiation with the banks and other financial institutions for the renewal or extension of the repayment terms of the outstanding principals and accrued interests.

The consolidated financial statements had been prepared on a going concern basis, the validity of which depends on the outcome of these measures, which are subject to multiple uncertainties, including (i) continuous financial support from the immediate holding company; (ii) the successful remedial action taken in respect of defaulted borrowings; and (iii) cash inflow from operations. Should the Group fail to achieve the above mentioned plans and measures, it might not be able to continue as a going concern, and adjustments would have to be made to write down the carrying values of the Group's assets to their recoverable amounts, to provide for any further liabilities which might arise and to reclassify non-current assets and non-current liabilities as current assets and current liabilities. The effects of these adjustments have not been reflected in these consolidated financial statements.

PUBLICATION OF ANNUAL RESULTS

The results announcement of the Company is published on the websites of the Stock Exchange (http://www.hkexnews.hk) and the Company (http://www.chinahuajungroup.com/).

By Order of the Board

China Huajun Group Limited

Meng Guang Bao

Chairman and Executive Director

Hong Kong, 31 March 2021

As at the date of this announcement, the Board comprises Mr. Meng Guang Bao, Ms. Zhang Ye, Ms. Huang Xiumei, and Ms. Bao Limin as executive Directors; and Mr. Zheng Bailin, Mr. Shen Ruolei and Mr. Pun Chi Ping as independent non-executive Directors.

If there is any inconsistency in this announcement between the Chinese and English versions and the English version shall prevail.

* For identification purpose only

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China Huajun Group Limited published this content on 01 April 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 31 March 2021 22:09:07 UTC.

Market Closed - Hong Kong S.E. Other stock markets 01:38:05 31/05/2024 pm IST			5-day change	1st Jan Change
1.49 ^HKD	+49.00%		+49.00%	+50.51%

14/05	China Huajun's Winding-Up Hearing Adjourned to August	MT
16/04	Hong Kong Court Adjourns China Huajun Winding-Up Hearing to May 13	MT

China Huajun's Winding-Up Hearing Adjourned to August	14/05	MT
Hong Kong Court Adjourns China Huajun Winding-Up Hearing to May 13	16/04	MT
China Huajun Group Limited Reports Earnings Results for the Full Year Ended December 31, 2023	28/03	CI
China Huajun Group Limited Announces Change of Address	12/01	CI
Winding-Up Hearing Against China Huajun Group Adjourned to April 2024	11/12	MT
Winding-Up Hearing Against China Huajun Adjourned	06/12	MT
Winding-Up Petition Hearing Against China Huajun Group Adjourned to December; Shares Slump 19%	16/11	MT
Winding-Up Petition Filed Against China Huajun by Bondholder; Shares Slump 23%	07/23/07	MT
China Huajun Group's H1 Attributable Loss Widens on Surge in Fair Value Losses	06/23/06	MT
China Huajun Group Limited Reports Earnings Results for the Half Year Ended June 30, 2023	31/23/31	CI
China Huajun Group Sells United Securities (HK) for HK$9.4 Million; Shares Slip 5%	16/23/16	MT
Ms. Chang Minqin, Ms. Li Junping and Mr. Chen Pengyu entered into Equity Transfer Agreements to acquire United Securities Limited from China Huajun Group Limited for HKD 9.427 million.	15/23/15	CI
China Huajun Group Limited Announces Management Changes	11/23/11	CI
China Huajun Group Limited Reports Earnings Results for the Full Year Ended December 31, 2022	31/23/31	CI
China Huajun Group Limited Announces Executives Changes	31/23/31	CI
China Huajun Group Warns of Up to 180% Increase in Loss in 2022	27/23/27	MT
China Huajun Group Limited Provides Earnings Guidance for the Year Ended 31 December 2022	24/23/24	CI
China Huajun Proposes Appointment of New Auditor	20/23/20	MT
China Huajun Group's Shares Remain Suspended	04/23/04	MT
China Huajun Unit Faces Bankruptcy Liquidation Petition	27/22/27	MT
China Huajun Group Limited Reports Earnings Results for the Half Year Ended June 30, 2022	30/22/30	CI
China Huajun Group Limited Provides Consolidated Earnings Guidance for the Six Months Ended 30 June 2022	23/22/23	CI
China Huajun Group Sees Higher FY22 Loss	24/22/24	MT
China Huajun Group Limited Announces Change of Principal Share Registrar and Transfer Office in Bermuda	08/22/08	CI
China Huajun Joint CEO Steps Down	08/22/08	MT

	1st Jan change	Capi.
CHINA HUAJUN GROUP LIMITED	+50.51%	11.73M
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HUBEI NENGTER TECHNOLOGY CO.,LTD	-4.43%	941M
JIANGSU HUIFENG BIO AGRICULTURE CO., LTD.	+54.92%	622M
CHORI CO., LTD.	+25.84%	557M
TOMOE ENGINEERING CO., LTD.	+12.08%	274M
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PT UNGGUL INDAH CAHAYA TBK	-3.96%	186M

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