Xinchen China Power : Announcements and Notices - Announcement of Unaudited Interim Results for the Six Months Ended 30 June 2019

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XINCHEN CHINA POWER HOLDINGS LIMITED

新 晨 中 國 動 力 控 股 有 限 公 司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 1148)

ANNOUNCEMENT OF UNAUDITED INTERIM RESULTS

FOR THE SIX MONTHS ENDED 30 JUNE 2019

The board of directors (the "Board") of Xinchen China Power Holdings Limited (the "Company") announces the unaudited consolidated interim financial results of the Company and its subsidiaries (collectively referred to as the "Group") for the six months ended 30 June

2019 as follows:

CONDENSED CONSOLIDATED STATEMENT OF PROFIT AND LOSS AND OTHER COMPREHENSIVE INCOME

For the six months ended 30 June 2019

		Six months ended
		30.6.2019		30.6.2018
	NOTES	RMB'000	RMB'000
		(unaudited)	(unaudited)
Revenue	3	1,154,612		1,559,485
Cost of sales		(1,001,051)	(1,357,647)
Gross profit		153,561		201,838
Other income	4	4,735		4,560
Other gains and losses		5,879		9,284
Distribution and selling expenses		(18,422)	(18,201)
Administrative expenses		(62,226)	(74,397)
Other expenses		(2,384)	(3,580)
Share of result of a joint venture		-	(276)
Finance costs		(41,760)	(42,256)
Profit before tax	5	39,383		76,972
Income tax expense	6	(7,455)	(19,352)
Profit for the period		31,928		57,620

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		Six months ended
		30.6.2019		30.6.2018
	NOTES	RMB'000	RMB'000
		(unaudited)	(unaudited)
Other comprehensive income:
Items that may be reclassified
to profit or loss:
Fair value (loss)/gain on:
Receivables measured at fair value
through other comprehensive income		(1,484)	83
Other comprehensive (loss)/income
for the period		(1,484)	83
Total comprehensive income for the period		30,444		57,703
Earnings per share - Basic (RMB)	8	0.025		0.045

The Group has initially applied Hong Kong Financial Reporting Standard ("HKFRS") 16 at 1 January 2019, using the modified retrospective approach. Under this approach, comparative information is not restated. See note 2.

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CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

At 30 June 2019

		30.6.2019	31.12.2018
	NOTES	RMB'000		RMB'000
		(unaudited)		(audited)
NON-CURRENT ASSETS
Property, plant and equipment	9	2,625,420	2,581,151
Prepaid lease payments		132,132	130,408
Intangible assets	9	640,057	623,455
Loan to a shareholder		13,583	13,097
Deferred tax assets		19,198	19,198
		3,430,390	3,367,309
CURRENT ASSETS
Inventories		776,781	839,508
Trade and other receivables	10a	516,975	562,687
Receivables measured at fair value through
other comprehensive income ("FVTOCI")	10b	131,167	217,396
Prepaid lease payments		-	3,378
Tax recoverable		29,496	31,479
Amounts due from related companies	11	1,115,142	1,285,192
Pledged/restricted bank deposits		265,976	595,782
Bank balances and cash		157,626	223,950
		2,993,163	3,759,372
Assets classified as held for sale	12	-	49,193
TOTAL CURRENT ASSETS		2,993,163	3,808,565
TOTAL ASSETS		6,423,553	7,175,874

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		30.6.2019	31.12.2018
	NOTES	RMB'000		RMB'000
		(unaudited)		(audited)
CURRENT LIABILITIES
Trade and other payables	13	1,381,043	1,938,128
Amounts due to related companies	14	157,649	241,374
Lease liabilities	15	8,125		-
Financial liabilities at fair value through
profit or loss		4,216	5,616
Borrowings due within one year		870,553	682,828
		2,421,586	2,867,946
NET CURRENT ASSETS		571,577	940,619
TOTAL ASSETS LESS CURRENT
LIABILITIES		4,001,967	4,307,928
NON-CURRENT LIABILITIES
Borrowings due after one year		928,125	1,267,808
Lease liabilities	15	9,552		-
Deferred income		48,143	54,417
		985,820	1,322,225
NET ASSETS		3,016,147	2,985,703
CAPITAL AND RESERVES
Share capital	16	10,457	10,457
Reserves		3,005,690		2,975,246
TOTAL EQUITY		3,016,147	2,985,703

The Group has initially applied HKFRS 16 at 1 January 2019, using the modified retrospective approach. Under this approach, comparative information is not restated. See note 2.

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NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the six months ended 30 June 2019

1. BASIS OF PREPARATION
   The condensed consolidated financial statements have been prepared in accordance with Hong Kong Accounting Standard ("HKAS") 34 "Interim Financial Reporting" issued by the Hong Kong Institute of Certified Public Accountants ("HKICPA") as well as with the applicable disclosure requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Listing Rules").
2. PRINCIPAL ACCOUNTING POLICIES
   The condensed consolidated financial statements have been prepared on the historical cost basis except for certain financial instruments, which are measured at fair values.
   Other than changes in accounting policies resulting from application of new and amendments to HKFRSs, the accounting policies and methods of computation used in the condensed consolidated financial statements for the six months ended 30 June 2019 are the same as those followed in the preparation of the Group's annual financial statements for the year ended 31 December 2018.
   Adoption of new and amendments to HKFRSs

In the current interim period, the Group has applied, for the first time, the following new and amendments to HKFRSs and an interpretation issued by the HKICPA which are mandatory effective for the annual period beginning on or after 1 January 2019 for the preparation of the Group's condensed consolidated financial statements:

HKFRS 16	Leases
Amendments to HKFRS 9	Prepayment Features with Negative Compensation
Amendments to HKAS 19	Plan Amendment, Curtailment or Settlement
Amendments to HKAS 28	Long-term Interests in Associates and Joint Ventures
Hong Kong (International Financial	Uncertainty over Income Tax Treatments
Reporting Interpretation Committee)
Interpretation ("HK(IFRIC) - Int") 23
Amendments to HKFRSs	Annual Improvements to HKFRSs 2015-2017 Cycle

Other than the impact of the adoption of HKFRS 16 as noted below, the adoption of the new and amended HKFRSs has had no material impact on how the results and financial position for the current and prior periods have been prepared and presented. The Group has not applied any new standard or interpretation that is not yet effective for the current accounting period.

HKFRS 16 "Leases"

HKFRS 16 "Leases" replaces HKAS 17 "Leases" along with three Interpretations, HK(IFRIC)-Int

4 "Determining whether an Arrangement contains a Lease", Hong Kong (Standing Interpretations Committee) Interpretation ("HK(SIC) Int") - 15 "Operating Leases-Incentives" and HK(SIC) Int-27 "Evaluating the Substance of Transactions Involving the Legal Form of a Lease". HKFRS 16 has been applied using the modified retrospective approach, with the cumulative effect of adopting HKFRS 16 being recognised in equity as an adjustment to the opening balance of retained profits for the current period. Prior periods have not been restated.

For contracts in place at the date of initial application, the Group has elected to apply the definition of a lease from HKAS 17 and HK(IFRIC)-Int 4 and has not applied HKFRS 16 to arrangements that were previously not identified as lease under HKAS 17 and HK(IFRIC)-Int 4. The Group has already recognised the prepaid lease payments for leasehold land where the Group is a lessee. The application of HKFRS 16 does not have impact on these assets except for the whole balance is now presented as "Prepaid lease payments" under non-current assets.

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