CHINA MERCHANTS PORT GROUP CO., LTD.
FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
CHINA MERCHANTS PORT GROUP CO., LTD.
FINANCIAL STATEMENTS AND AUDITOR'S REPORT
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
CONTENTS PAGES THE CONSOLIDATED AND COMPANY BALANCE SHEETS 1 - 4
THE CONSOLIDATED AND COMPANY INCOME STATEMENTS 5 - 7
THE CONSOLIDATED AND COMPANY CASH FLOW STATEMENTS 8 - 9
NOTES TO THE FINANCIAL STATEMENTS 10 - 132
CHINA MERCHANTS PORT GROUP CO., LTD.
AT 30 JUNE 2019
Consolidated Balance Sheet
Unit: RMB
|||||
|-|-|-|-|
|Item|Notes|30/06/2019|31/12/2018 (restated)|
|Current assets:||||
|Cash and bank balances|(V)1|7,055,470,795.98|7,077,396,895.72|
|Notes receivable|(V)2|230,573,402.76|11,608,669.43|
|Accounts receivable|(V)3|1,826,407,082.63|1,109,230,503.08|
|Prepayments|(V)4|110,755,247.26|124,404,862.87|
|Other receivables|(V)5|8,060,039,732.79|766,518,078.72|
|Inventories|(V)6|177,691,083.71|108,567,270.02|
|Assets held for sale|(V)7|115,356,162.94|115,356,162.94|
|Non-current assets due within one year|(V)8|867,338,469.27|25,952,956.76|
|Other current assets|(V)9|251,682,098.85|1,195,421,189.12|
|Total current assets||18,695,314,076.19|10,534,456,588.66|
|Non-current Assets:||||
|Long-term receivables|(V)10|940,430,346.97|793,046,240.11|
|Long-term equity investments|(V)11|49,101,264,546.66|50,176,577,263.40|
|Other investments in equity instruments|(V)12|566,083,559.83|247,848,314.30|
|Other non-current financial assets|(V)13|3,019,618,722.58|2,087,872,081.94|
|Investment properties|(V)14|5,860,454,152.44|5,890,146,989.51|
|Fixed assets|(V)15|25,605,443,597.36|22,994,190,880.43|
|Construction in progress|(V)16|7,255,432,536.56|5,499,426,090.06|
|Right-of-use assets|(V)17|7,707,006,935.05||
|Intangible assets|(V)18|22,350,877,669.78|20,761,018,044.54|
|Development Expenditure|(V)19|17,221,612.02|-|
|Goodwill|(V)20|8,199,724,444.77|8,335,895,842.35|
|Long-term prepaid expenses|(V)21|221,739,319.29|235,706,437.21|
|Deferred tax assets|(V)22|116,280,906.54|66,708,157.19|
|Other non-current assets|(V)23|2,079,773,743.04|395,191,485.98|
|Total non-current assets||133,041,352,092.89|117,483,627,827.02|
|TOTAL ASSETS||151,736,666,169.08|128,018,084,415.68|

 The financial statements and notes were signed by the following:
Legal Representative: Bai Jingtao
Chief Financial Officer: Wen Ling
Head of Accounting Department: Sun Ligan
CHINA MERCHANTS PORT GROUP CO., LTD.
AT 30 JUNE 2019
Consolidated Balance Sheet - continued
Unit: RMB
|||||
|-|-|-|-|
|Item|Notes|30/06/2019|31/12/2018 (restated)|
|Current liabilities:||||
|Short-term borrowings|(V)24|7,566,020,460.46|3,427,365,512.21|
|Notes payable|(V)25|69,419,891.54|-|
|Accounts payable|(V)26|544,188,025.02|429,120,690.97|
|Receipts in advance|(V)27|28,204,626.82|29,170,709.86|
|Contract liabilities|(V)28|151,331,357.06|49,993,895.50|
|Employee benefits payable|(V)29|531,902,124.62|433,489,555.40|
|Taxes payable|(V)30|1,530,590,561.50|345,183,422.42|
|Other payables|(V)31|3,421,776,143.11|1,690,124,901.29|
|Non-current liabilities due within one year|(V)32|3,782,456,888.55|2,903,320,877.97|
|Other current liabilities|(V)33|1,456,067,284.82|602,659,721.80|
|Total current liabilities||19,081,957,363.50|9,910,429,287.42|
|Non-current Liabilities:||||
|Long-term borrowings|(V)34|7,456,687,214.19|6,971,479,842.18|
|Bonds payable|(V)35|22,057,369,574.31|22,097,467,096.40|
|Lease liabilities|(V)36|1,740,889,561.88||
|Long-term payables|(V)37|1,269,553,048.04|1,294,190,118.18|
|Projected benefits obligation|(V)38|726,014,472.07|375,325,127.65|
|Provisions|(V)39|41,571,808.82|34,951,392.27|
|Deferred income|(V)40|2,161,007,055.37|228,658,214.64|
|Deferred tax liabilities|(V)22|3,950,034,565.54|2,911,074,941.27|
|Other non-current liabilities|(V)41|3,978,432,377.93|3,777,582,522.86|
|Total non-current liabilities||43,381,559,678.15|37,690,729,255.45|
|TOTAL LIABILITIES||62,463,517,041.65|47,601,158,542.87|
|SHAREHOLDERS' EQUITY:||||
|Share capital|(V)42|1,793,412,378.00|1,793,412,378.00|
|Capital reserve|(V)43|19,548,822,799.86|19,426,912,957.05|
|Other comprehensive income|(V)44|-243,686,564.51|88,925,978.57|
|Special reserve|(V)45|20,454,196.39|8,231,080.43|
|Surplus reserve|(V)46|527,175,908.67|527,175,908.67|
|Unappropriated profit|(V)47|10,972,690,972.30|8,915,817,110.21|
|Total shareholders' equity attributable to equity holders of||32,618,869,690.71|30,760,475,412.93|
|the parent||||
|Total minority interests||56,654,279,436.72|49,656,450,459.88|
|TOTAL SHAREHOLDERS' EQUITY||89,273,149,127.43|80,416,925,872.81|
|TOTAL LIABILITIES AND||151,736,666,169.08|128,018,084,415.68|
|SHAREHOLDERS' EQUITY||||

The accompanying notes form part of the financial statements.
CHINA MERCHANTS PORT GROUP CO., LTD.
AT 30 JUNE 2019
Balance Sheet of the Company
Unit: RMB
|||||
|-|-|-|-|
|Item|Notes|30/06/2019|31/12/2018 (restated)|
|Current Assets:||||
|Cash and bank balances||324,274,763.05|389,841,854.93|
|Accounts receivable|(XIV)1|19,010,075.81|23,444,175.65|
|Other receivables|(XIV)2|1,329,604,071.05|651,050,233.08|
|Inventories||148,852.46|165,553.46|
|Other current assets||1,128,777.61|1,563,111.61|
|Total current assets||1,674,166,539.98|1,066,064,928.73|
|Non-current Assets:||||
|Long-term receivables||11,004,284.75|11,004,284.75|
|Long-term equity investments|(XIV)3|28,549,327,394.77|28,544,261,576.96|
|Other investments in equity instruments||528,021,090.00|151,746,700.00|
|Investment properties||14,044,663.33|12,685,959.06|
|Fixed assets||180,765,459.07|190,804,655.63|
|Construction in progress||2,516,692.93|2,500,843.87|
|Right-of-use assets||9,015,046.28||
|Intangible assets||56,408,816.33|57,755,603.44|
|Long-term prepaid expenses||3,706,930.48|3,785,801.32|
|Total non-current assets||29,354,810,377.94|28,974,545,425.03|
|TOTAL ASSETS||31,028,976,917.92|30,040,610,353.76|

CHINA MERCHANTS PORT GROUP CO., LTD.
AT 30 JUNE 2019
Balance Sheet of the Company - continued
Unit: RMB
|||||
|-|-|-|-|
|Item|Notes|30/06/2019|31/12/2018 (restated)|
|Current Liabilities:||||
|Short-term borrowings||-|377,716,000.00|
|Accounts payable||11,373,094.51|13,125,624.29|
|Contract liabilities||30,503.00|92,003.00|
|Employee benefits payable||18,440,387.81|26,605,190.52|
|Taxes payable||148,852,424.74|18,826,587.50|
|Other payables||684,370,662.13|717,536,924.18|
|Non-current liabilities due within one year||306,704,226.28|299,531,506.81|
|Other current liabilities||1,000,000,000.00|200,000,000.00|
|Total current liabilities||2,169,771,298.47|1,653,433,836.30|
|Non-current Liabilities:||||
|Lease liabilities||2,987,130.94||
|Long-term payables||35,188,000.00|151,710,000.00|
|Deferred tax liabilities||34,414,375.00|34,179,375.00|
|Total non-current liabilities||72,589,505.94|185,889,375.00|
|TOTAL LIABILITIES||2,242,360,804.41|1,839,323,211.30|
|SHAREHOLDERS' EQUITY||||
|Share capital||1,793,412,378.00|1,793,412,378.00|
|Capital reserve||25,517,679,153.52|25,517,647,180.04|
|Other comprehensive income||103,343,125.00|102,638,125.00|
|Special reserve||478,474.85|470,465.59|
|Surplus reserve||527,175,908.67|527,175,908.67|
|Unappropriated profit||844,527,073.47|259,943,085.16|
|TOTAL SHAREHOLDERS'||28,786,616,113.51|28,201,287,142.46|
|EQUITY||||
|TOTAL LIABILITIES AND SHAREHOLDERS'||31,028,976,917.92|30,040,610,353.76|
|EQUITY||||

The accompanying notes form part of the financial statements.
CHINA MERCHANTS PORT GROUP CO., LTD.
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
Consolidated Income Statement
Unit: RMB
||||||||
|-|-|-|-|-|-|-|
|||||Amount incurred in the||Amount incurred in the|
|Item||Notes|||||
|||||current period||previous period|
|I. Operating income|(V)48||5,834,353,421.33||4,672,338,040.72||
|Less: Operating costs|(V)48||3,608,020,695.91||2,614,461,218.38||
|Business taxes and levies|(V)49||96,475,511.42||83,041,239.55||
|Sales expenses|||-||-||
|Administrative expenses|(V)50||647,244,718.36||497,420,738.23||
|Research and development expenses|||60,018,835.29||48,063,815.62||
|Financial expenses|(V)51||873,109,624.88||724,062,144.53||
|Including: Interest expense|||1,037,955,298.30||711,988,706.80||
|Interest income|||139,353,821.46||110,201,974.82||
|Add: Other income|(V)52||73,092,505.76||26,603,312.77||
|Investment income|(V)53||2,625,049,484.56||1,536,300,233.07||
|Including: Income from investments in|(V)53||1,795,952,978.08||1,497,601,956.62||
|associates and joint ventures|||||||
|Gain or loss from derecognition of|||-||-||
|Financial assets measured at|||||||
|amortized cost|||||||
|Gains (losses) from changes in fair value|(V)54||643,627,313.01||-471,339,392.83||
|Impairment gain of credit|(V)55||7,699,134.78||1,789,443.78||
|Impairment gain of assets|(V)56||25,051.16||-||
|Gains (losses) on disposal of assets|(V)57||4,169,857,166.53||10,478,881.99||
|II. Operating profit|||8,068,834,691.27||1,809,121,363.19||
|Add: Non-operating income|(V)58||14,379,618.34||45,638,666.45||
|Less: Non-operating expenses|(V)59||7,506,374.29||22,984,336.32||
|III. Gross profit|||8,075,707,935.32||1,831,775,693.32||
|Less: Income tax expenses|(V)60||2,017,970,750.16||376,500,021.27||
|IV. Net profit|||6,057,737,185.16||1,455,275,672.05||
|(I) Categorization by continuity of operation||||-|||
|1. Net profit of continued operation|||6,057,737,185.16||1,455,275,672.05||
|2. Net profit of discontinued operation|||-||-||
|(II) Categorization by attribution of ownership|||||||
|1. Net profit attributable to shareholders of the|||2,299,181,330.61||620,038,405.65||
|parent|||||||
|2. Profit or loss attributable to minority shareholder|||3,758,555,854.55||835,237,266.40||

CHINA MERCHANTS PORT GROUP CO., LTD.
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
Consolidated Income Statement - continued
Unit: RMB
||||||||
|-|-|-|-|-|-|-|
|||||Amount incurred in||Amount incurred in|
|Item||Notes|||||
|||||the current period||the previous period|
|V. Amount of other comprehensive net income after|(V)62||-916,016,194.57||13,454,270.70||
|tax|||||||
|Amount of other comprehensive net income after tax|||-332,612,543.08||8,123,952.05||
|attributable to equity holders of the parent|||||||
|(I) Other comprehensive income that will not be|||15,630,350.48||-352,500.00||
|reclassified to profit or loss|||||||
|1. Change as a result of remeasurement of the net|||-||-||
|defined benefit plan|||||||
|2. Other comprehensive income under the equity|||14,925,350.48||-||
|method that will not be reclassified to profit or loss|||||||
|3. Fair value changes of other investments in equity|||705,000.00||-352,500.00||
|instruments|||||||
|(II) Other comprehensive income that will be|||-348,242,893.56||8,476,452.05||
|reclassified subsequently to profit or loss|||||||
|1. Other comprehensive income under the equity|||-25,779,604.80||-418,926.87||
|method that will be reclassified to profit or loss|||||||
|2. Fair value changes of other equity investments|||-||-14,759.46||
|3. Translation differences of financial statements|||-322,463,288.76||8,910,138.38||
|denominated in foreign currencies|||||||
|Amount of other comprehensive net income after tax|||-583,403,651.49||5,330,318.65||
|attributable to minority shareholders|||||||
|VI. Total comprehensive income attributable to:|||5,141,720,990.59||1,468,729,942.75||
|Shareholders of the parent|||1,966,568,787.53||628,162,357.70||
|Minority shareholders|||3,175,152,203.06||840,567,585.05||
|VII. Earnings per share|||||||
|(I) Basic earnings per share|||1.28||0.35||
|(II) Diluted earnings per share|||1.28||0.35||

 The accompanying notes form part of the financial statements.
CHINA MERCHANTS PORT GROUP CO., LTD.
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
Income Statement of the Company
Unit: RMB
||||||||
|-|-|-|-|-|-|-|
|||||Amount incurred in||Amount incurred in|
|Item||Notes|||||
|||||the current period||the previous period|
|I. Operating income|(XIV)4||89,776,788.29||119,422,977.47||
|Less: Operating costs|(XIV)4||72,138,491.00||66,904,086.32||
|Business taxes and levies|||1,386,897.46||1,668,896.31||
|Administrative expenses|||37,458,257.94||37,663,434.34||
|Research and development expenses|||-||-||
|Financial expenses|||28,123,295.64||11,394,012.23||
|Including: Interest expense|||22,334,322.60||16,375,152.68||
|Interest income|||6,848,157.41||12,911,196.35||
|Add: Other income|||211,721.77||-||
|Investment income|(XIV)5||986,513,980.21||45,416,275.00||
|Including: Income from investments in associates and|(XIV)5||37,846,506.83||37,627,300.00||
|joint ventures|||||||
|Gain or loss from derecognition of Financial|||-||-||
|assets measured at amortized cost|||||||
|Impairment gain of credit|||-||-||
|Impairment gain of assets|||-||-||
|Gains (losses) on disposal of assets|||-||-||
|II. Operating profit|||937,395,548.23||47,208,823.27||
|Add: Non-operating income|||35,710.26||968,382.40||
|Less: Non-operating expenses|||68,028.29||1,187,353.35||
|III. Gross profit|||937,363,230.20||46,989,852.32||
|Less: Income tax expenses|||148,004,636.57||395,773.33||
|IV. Net profit|||789,358,593.63||46,594,078.99||
|V. Amount of other comprehensive net income after tax|||705,000.00||-585,000.00||
|(I) Other comprehensive income that will not be reclassified|||705,000.00||-585,000.00||
|subsequently to profit or loss|||||||
|1. Change as a result of remeasurement of the net defined|||-||-||
|benefit plan|||||||
|2. Other comprehensive income under the equity method|||-||-||
|that will not be reclassified to profit or loss|||||||
|3. Fair value changes of other investments in equity|||705,000.00||-585,000.00||
|instruments|||||||
|(II) Other comprehensive income that will be reclassified to|||-||-||
|profit or loss|||||||
|1. Other comprehensive income under the equity method|||-||-||
|that will be reclassified to profit or loss|||||||
|2. Gains or losses on changes in fair value of available-for-|||-||-||
|sale financial assets|||||||
|3. Translation differences of financial statements|||-||-||
|denominated in foreign currencies|||||||
|VI. Total comprehensive income|||790,063,593.63||46,009,078.99||

 The accompanying notes form part of the financial statements.
CHINA MERCHANTS PORT GROUP CO., LTD.
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
Consolidated Cash Flow Statement
Unit: RMB
|||||
|-|-|-|-|
|||Amount incurred in|Amount incurred in|
|Item|Notes|||
|||the current period|the previous period|
|I. Cash Flows from Operating Activities:||||
|Cash receipts from sales of goods and rendering of services||5,754,573,111.14|4,308,320,507.35|
|Receipts of tax refunds||1,028,913.99|4,421,005.64|
|Other cash receipts relating to operating activities|(V)63(1)|628,327,662.03|360,470,289.18|
|Sub-total of cash inflows||6,383,929,687.16|4,673,211,802.17|
|Cash payments for goods purchased and services received||1,686,739,386.99|1,217,915,421.65|
|Cash payments to and on behalf of employees||1,289,823,173.43|930,421,609.67|
|Payments of all types of taxes||472,544,903.05|331,244,635.01|
|Other cash payments relating to operating activities|(V)63(2)|377,960,308.17|392,895,417.13|
|Sub-total of cash outflows||3,827,067,771.64|2,872,477,083.46|
|Net Cash Flows from Operating Activities|(V)64(1)|2,556,861,915.52|1,800,734,718.71|
|II. Cash Flows from Investing Activities:||||
|Cash receipts from disposals and recovery of investments||-|200,000.00|
|Cash receipts from investments income||255,735,654.65|270,788,784.87|
|Net cash receipts from disposal of fixed assets, intangible||28,746,274.62|6,230,106.16|
|assets and other long-term assets||||
|Net cash receipts from disposal of subsidiary and other||-|-|
|operating units||||
|Other cash receipts relating to investing activities|(V)63(3)、(4)|2,641,747,342.20|1,000,000.00|
|Sub-total of cash inflows||2,926,229,271.47|278,218,891.03|
|Cash payments to acquire or construct fixed assets, intangible||1,557,516,143.20|1,043,472,074.69|
|assets and other long-term assets||||
|Cash payments to acquire investments||321,023,297.25|3,419,937,193.56|
|Net cash payment to acquire subsidiary and other operating||-|9,200,472,631.65|
|units||||
|Other cash payments relating to investing activities|(V)63(5)|973,903,129.78|25,463,391.23|
|Sub-total of cash outflows||2,852,442,570.23|13,689,345,291.13|
|Net Cash Flows from Investing Activities||73,786,701.24|-13,411,126,400.10|
|III. Cash Flows from Financing Activities:||||
|Cash receipts from capital contributions||27,255,000.00|15,950,000.00|
|Including: cash receipts from capital contributions from||27,255,000.00|15,950,000.00|
|minority owners of subsidiary||||
|Cash receipts from borrowings||8,519,572,630.94|17,062,051,282.50|
|Cash receipts from issue of bonds||1,000,000,000.00|700,000,000.00|
|Other cash receipts relating to financing activities|(V)63(6)|-|4,422,370,076.87|
|Sub-total of cash inflows||9,546,827,630.94|22,200,371,359.37|
|Cash repayments of borrowings||10,576,686,264.69|9,324,223,330.27|
|Cash payments for distribution of dividends or profit or||1,120,395,167.09|1,274,561,425.91|
|interest||||
|Including: Payments for distribution of dividends or profit to||150,969,238.87|649,383,878.87|
|minorities||||
|Other cash payments relating to financing activities|(V)63(7)|215,990,980.67|36,616,456.42|
|Sub-total of cash outflows||11,913,072,412.45|10,635,401,212.60|
|Net Cash Flows from Financing Activities||-2,366,244,781.51|11,564,970,146.77|
|IV. Effect of Foreign Exchange Rate Changes on Cash and||-19,500,690.81|-22,476,832.15|
|Cash Equivalents||||
|V. Net Increase (Decrease) in Cash and Cash Equivalents||244,903,144.44|-67,898,366.77|
|Add: Opening Balance of Cash and Cash Equivalents|(V)64(2)|5,373,281,504.75|7,729,460,082.75|
|VI. Closing Balance of Cash and Cash Equivalents|(V)64(2)|5,618,184,649.19|7,661,561,715.98|

The accompanying notes form part of the financial statements.
CHINA MERCHANTS PORT GROUP CO., LTD.
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
Cash Flow Statement of the Company
Unit: RMB
|||||
|-|-|-|-|
|||Amount incurred in|Amount incurred in|
|Item|Notes|||
|||the current period|the previous period|
|I. Cash Flows from Operating Activities:||||
|Cash receipts from sales of goods and rendering of services||90,193,645.46|107,636,176.67|
|Other cash receipts relating to operating activities||2,827,290.04|230,346,187.55|
|Sub-total of cash inflows||93,020,935.50|337,982,364.22|
|Cash payments for goods purchased and services received||30,749,568.38|35,630,528.08|
|Cash payments to and on behalf of employees||64,417,358.35|68,710,981.15|
|Payments of all types of taxes||19,019,323.75|3,485,828.13|
|Other cash payments relating to operating activities||245,001,703.97|388,259,171.05|
|Sub-total of cash outflows||359,187,954.45|496,086,508.41|
|Net Cash Flows from Operating Activities||-266,167,018.95|-158,104,144.19|
|II. Cash Flows from Investing Activities:||||
|Cash receipts from investments income||273,935,026.51|444,277,054.92|
|Net cash receipts from disposal of fixed assets, intangible assets||-|178,876.00|
|and other long-term assets||||
|Other cash receipts relating to investing activities||228,867,355.24|-|
|Sub-total of cash inflows||502,802,381.75|444,455,930.92|
|Cash payments to acquire or construct fixed assets, intangible||1,916,637.68|5,461,752.50|
|assets and other long-term assets||||
|Cash payments for investments||375,334,390.00|-|
|Net cash payments for acquisition of subsidiaries and other||10,825,000.00|149,709,800.00|
|business entities||||
|Other cash payments relating to investing activities||185,800,000.00|-|
|Sub-total of cash outflows||573,876,027.68|155,171,552.50|
|Net Cash Flows from Investing Activities||-71,073,645.93|289,284,378.42|
|III. Cash Flows from Financing Activities:||||
|Cash receipts from capital contributions||-|-|
|Cash receipts from borrowings||660,000,000.00|571,758,000.00|
|Cash receipts from issue of bonds||1,000,000,000.00|200,000,000.00|
|Other cash receipts relating to financing activities||-|-|
|Sub-total of cash inflows||1,660,000,000.00|771,758,000.00|
|Cash repayments of borrowings||1,361,616,000.00|170,000,000.00|
|Cash payments for distribution of dividends or profit or interest||19,237,193.99|855,728,376.23|
|Other cash payments relating to financing activities||4,033,208.78|663,373.11|
|Sub-total of cash outflows||1,384,886,402.77|1,026,391,749.34|
|Net Cash Flows from Financing Activities||275,113,597.23|-254,633,749.34|
|IV. Effect of Foreign Exchange Rate Changes on Cash and||-3,440,024.23|-8,716,054.32|
|Cash Equivalents||||
|V. Net Increase in Cash and Cash Equivalents||-65,567,091.88|-132,169,569.43|
|Add: Opening balance of Cash and Cash Equivalents||389,841,854.93|230,039,345.73|
|VI. Closing Balance of Cash and Cash Equivalents||324,274,763.05|97,869,776.30|

 The accompanying notes form part of the financial statements.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
I. GENERAL INFORMATION OF THE COMPANY
China Merchants Port Holdings Company Limited (formerly known as "Shenzhen Chiwan Wharf Holdings Limited", hereinafter referred to as the "Company") is a stock limited company incorporated in Shenzhen, Guangdong Province, on 16 January 1993.
On 30 October 2018, as approved by the Reply on Approving Issuance of Shares to Purchase Assets and Collection of Funds from Shenzhen Chiwan Wharf Holdings Limited to China Merchants Investment Development Company Limited (Zheng Jian Xu Ke[2018] No. 1750) issued by China Securities Regulatory Commission ("CSRC"), the Company issued 1,148,648,648 shares of A-stock to China Merchants Investment Development Company Limited ("CMID") to acquire39.45% equity of China Merchants Port Holdings Company Limited ("CMPORT"). The Company has adopted this name since completion of the acquisition. The headquarters of the Company is located in Shenzhen, Guangdong Province. The Company and its subsidiaries (collectively the "Group") are principally engaged in the rendering of port service, bonded logistics service and other business such as property development and investment. The Company's and consolidated financial statements have been approved by the Board of Directors on 29 August 2019.
See Notes (VII) "Equity in other entities" for details of the scope of consolidated financial statements in the current period are subsidiaries acquired through business combination under common control. See Note (VI) "Changes in scope of consolidation" for details of changes in the scope of consolidated financial statements in the current period.
II. BASIS OF PREPARATION OF FINANCIAL STATEMENTS
Basis of preparation of financial statements
The Group has adopted the Accounting Standards for Business Enterprises ("ASBE") issued by the Ministry of Finance ("MoF"). In addition, the Group has disclosed relevant financial information in accordance with Information Disclosure and Presentation Rules for Companies Offering Securities to the Public No. 15 - General Provisions on Financial Reporting (Revised in 2014).
Basis of accounting and principle of measurement
The Group has adopted the accrual basis of accounting. Except for certain financial instruments which are measured at fair value, the Group adopts the historical cost as the principle of measurement of the financial statements. Upon being restructured into a stock company, the fixed assets and intangible assets initially contributed by the state-owned shareholders are recognized based on the valuation amounts confirmed by the state-owned assets administration department.
Where assets are impaired, provisions for asset impairment are made in accordance with the
relevant requirements.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
II. BASIS OF PREPARATION OF FINANCIAL STATEMENTS - continued
Basis of accounting and principle of measurement - continued
Where the historical cost is adopted as the measurement basis, assets are recorded at the amount of cash or cash equivalents paid or the fair value of the consideration given to acquire them at the time of their acquisition. Liabilities are recorded at the amount of proceeds or assets received or the contractual amounts for assuming the present obligation, or, at the amounts of cash or cash equivalents expected to be paid to settle the liabilities in the normal course of business. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is directly observable or estimated using valuation technique. Fair value measurement and/or disclosure in the financial statements are determined according to the above basis. Fair value measurements are categorized into Level 1, 2 or 3 based on the degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which are described as follows:
 Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the entity can access at the measurement date;
 Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the asset or liability, either directly or indirectly; and
 Level 3 inputs are unobservable inputs for the asset or liability.
Going Concern
The Group assessed its ability to continue as a going concern for the 12 months from 30 June 2019 and did not notice any events or circumstances that may cast significant doubt upon its ability to continue as a going concern. Therefore, the financial statements have been prepared on a going concern basis.
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES
All the following significant accounting policies and accounting estimates are based on Accounting Standards for Business Enterprises ("ASBE").
1. Statement of compliance with the ASBE
The financial statements of the Group have been prepared in accordance with the ASBE, and have presented truly and completely, theGroup’s and the consolidated's financial position as of 30 June 2019, and theGroup’s and the consolidated's results of operations and cash flows for the period from 1 January 2019 to 30 June 2019.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
2. Accounting period
The Group has adopted the calendar year as its accounting year, e.g. from 1 January to 31 December.
3. Operating cycle
An operating cycle refers to the period since when an enterprise purchases assets for processing purpose till the realization of those assets in cash or cash equivalents. The Group is principally engaged in the rendering of port service, bonded logistics service and other business such as property development and investment with an operating cycle of one year.
4. Functional currency
Renminbi ("RMB") is the currency of the primary economic environment in which the Company operates. Therefore, the Company chooses RMB as its functional currency. The Company's subsidiaries chooses their functional currency on the basis of the primary economic environment in which they operate. The Company adopts RMB to prepare its financial statements.
5. The accounting treatment of business combinations involving or not involving enterprises under common control
Business combinations are classified into business combinations involving enterprises under common control and business combinations not involving enterprises under common control. 5.1 Business combinations involving enterprises under common control
A business combination involving enterprises under common control is a business combination in which all of the combining enterprises are ultimately controlled by the same party or parties both before and after the combination, and that control is not transitory.
Assets and liabilities obtained shall be measured at their respective carrying amounts as recorded by the combining entities at the date of the combination. The difference between the carrying amount of the net assets obtained and the carrying amount of the consideration paid for the combination is adjusted to the share premium in capital reserve. If the share premium is not sufficient to absorb the difference, any excess shall be adjusted against retained earnings. Costs that are directly attributable to the combination are charged to profit or loss in the period in which they are incurred.
5.2 Business combinations not involving enterprises under common control and goodwill A business combination not involving enterprises under common control is a business
combination in which all of the combining enterprises are not ultimately controlled by the same
party or parties before and after the combination.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
5. The accounting treatment of business combinations involving or not involving enterprises under common control - continued
5.2 Business combinations not involving enterprises under common control and goodwill - continued
The cost of combination is the aggregate of the fair values, at the acquisition date, of the assets given, liabilities incurred or assumed, and equity securities issued by the acquirer, in exchange for control of the acquisition. Where a business combination not involving enterprises under common control is achieved in stages that involve multiple transactions, the cost of combination is the sum of the consideration paid at the acquisition date and the fair value at the acquisition date of the acquirer's previously held interest in the acquiree. Intermediary expenses (fees in respect of auditing, legal services, valuation and consultancy services, etc.) and other administrative expenses attributable to the business combination are recognized in profit or loss in the periods when they are incurred.
The acquiree's identifiable assets, liabilities and contingent liabilities acquired by the acquirer in a business combination that meets the recognition criteria shall be measured at fair value at the acquisition date.
Where the cost of combination exceeds the acquirer's interest in the fair value of the acquiree's identifiable net assets, the difference is treated as an asset and recognized as goodwill, which is measured at cost on initial recognition. Where the cost of combination is less than the acquirer's interest in the fair value of the acquiree's identifiable net assets, the acquirer reassesses the measurement of the fair values of the acquiree's identifiable assets, liabilities and contingent liabilities and measurement of the cost of combination. If the cost of combination is still less than the acquirer's interest in the fair value of the acquiree's identifiable net assets afterwards, the acquirer recognizes the remaining difference immediately in profit or loss for the current period. Goodwill arising on a business combination is measured at cost less accumulated impairment losses, and is presented separately in the consolidated financial statements.
6. Preparation of consolidated financial statements
The scope of consolidation in the consolidated financial statements is determined on the basis of control. Control exists when the investor has power over the investee is exposed; or has rights to variable returns from its involvement with the investee; or has the ability to use its power over the investee to affect its returns. The Group reassesses whether or not it controls an investee if there are indications that there are changes of the above elements of the definition of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiaries and ceases when the Group loses control of the subsidiary.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
6. Preparation of consolidated financial statements - continued
For a subsidiary already disposed by the Group, the operating results and cash flows before the date of disposal (the date when control is lost) are included in the consolidated income statement and consolidated statement of cash flows, as appropriate.
For subsidiaries acquired through a business combination involving enterprises not under common control, the operating results and cash flows from the acquisition date (the date when control is obtained) are included, as appropriate, in the consolidated income statement and consolidated statement of cash flows.
No matter when the business combination occurs in the reporting period, subsidiaries acquired through a business combination involving enterprises under common control or the party being absorbed under merger by absorption are included in the Group's scope of consolidation as if they had been included in the scope of consolidation from the date when they first came under the common control of the ultimate controlling party. Their operating results and cash flows from the date when they first came under the common control of the ultimate controlling party are included, as appropriate, in the consolidated income statement and consolidated statement of cash flows. The significant accounting policies and accounting periods adopted by the subsidiaries are determined based on the uniform accounting policies and accounting periods set out by the Company.
All significant intra-group balances and transactions are eliminated on consolidation.
The portion of subsidiaries' equity that is not attributable to the parent is treated as minority interests and presented as "minority interests" in the consolidated balance sheet under shareholders' equity. The portion of net profits or losses of subsidiaries for the period attributable to minority interests is presented as "minority interests" in the consolidated income statement under the "net profit" line item.
When the amount of loss for the period attributable to the minority shareholders of a subsidiary exceeds the minority shareholders' portion of the opening balance of shareholders' equity of the subsidiary, the excess amount is still allocated against minority interests.
Acquisition of minority interests or disposals of interests in a subsidiary that do not result in the loss of control over the subsidiary are accounted for as equity transactions. The carrying amounts of the parent's interests and minority interests are adjusted to reflect the changes in their relative interests in the subsidiary. The difference between the amount by which the minority interests are adjusted and the fair value of the consideration paid or received is adjusted to capital reserve. If the capital reserve is not sufficient to absorb the difference, the excess is adjusted against retained earnings.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
6. Preparation of consolidated financial statements - continued
For the stepwise acquisition of equity interest till acquiring control after a few transactions and leading to business combination not involving enterprises under common control, this should be dealt with based on whether this belongs to 'package deal': if it belongs to 'package deal', transactions will be dealt as transactions to acquire control. If it does not belong to 'package deal', transactions to acquire control on acquisition date will be under accounting treatment, the fair value of acquirees' shares held before acquisition date will be revalued, and the difference between fair value and book value will be recognized in profit or loss of the current period; if acquirees' shares held before acquisition date involve in changes of other comprehensive income and other equity of owners under equity method, this will be transferred to income of acquisition date.
When the Group loses control over a subsidiary due to disposal of equity investment or other reasons, any retained interest is re-measured at its fair value at the date when control is lost. The difference between (i) the aggregate of the consideration received on disposal and the fair value of any retained interest and (ii) the share of the former subsidiary's net assets cumulatively calculated from the acquisition date according to the original proportion of ownership interests is recognized as investment income in the period in which control is lost, and the goodwill is offset accordingly. Other comprehensive income associated with investment in the former subsidiary is reclassified to investment income in the period in which control is lost.
When the Group loses control of a subsidiary in two or more arrangements (transactions), terms and conditions of the arrangements (transactions) and their economic effects are considered. One or more of the following indicate that the Group shall account for the multiple arrangements as a 'package deal':
• They are entered into at the same time or in contemplation of each other, or
• They form a complete transaction designed to achieve an overall commercial effect, or• The occurrence of one transaction is dependent on the occurrence of at least one other transaction, or
• One transaction alone is not economically justified, but it is economically justified when considered together with other transactions.
Where the transactions of disposal of equity investments in a subsidiary until the loss of control are assessed as a package deal, these transactions are accounted for as one transaction of disposal of a subsidiary with loss of control. Before losing control, the difference of consideration received on disposal and the share of net assets of the subsidiary continuously calculated from acquisition date is recognized as other comprehensive income. When losing control, the cumulated other comprehensive income is transferred to profit or loss of the period of losing control. If the transactions of disposal of equity investments in a subsidiary are not assessed as a package deal, these transactions are accounted for as unrelated transactions.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
7. Types of joint arrangements and the accounting treatment of joint operation There are two types of joint arrangements - joint operations and joint ventures. The classification of joint arrangements under is determined based on the rights and obligations of parties to the joint arrangements by considering the structure, the legal form of the arrangements, the contractual terms agreed by the parties to the arrangement. A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the assets, and obligations for the liabilities, relating to the arrangement. A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the arrangement.
Investments in joint ventures are accounted for using the equity method by the Group, which is detailed in Notes (III) 14.3.2, a long-term equity investment is subject to for using the equity method.
The Group as a joint operator recognizes the following items in relation to its interest in a joint operation:
• Its solely-held assets, including its share of any assets held jointly;
• Its solely-assumed liabilities, including its share of any liabilities incurred jointly;• Its revenue from the sale of its share of the output arising from the joint operation;• Its share of the revenue from the sale of the output by the joint operation; and
• Its solely-incurred expenses, including its share of any expenses incurred jointly. The Group accounts for the recognized assets, liabilities, revenues and expenses relating to its interest in a joint operation in accordance with the requirements applicable to the particular assets, liabilities, revenues and expenses.
8. Recognition criteria of cash and cash equivalents
Cash comprises cash on hand and deposits that can be readily withdrawn on demand. Cash equivalents are the Group's short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. 9. Foreign currency transactions
9.1 Transactions denominated in foreign currencies
A foreign currency transaction is recorded, on initial recognition, by applying the spot exchange rate on the date of the transaction.
At the balance sheet date, foreign currency monetary items are translated into functional currency using the spot exchange rates at the balance sheet date. Exchange differences arising from the differences between the spot exchange rates prevailing at the balance sheet date and those on initial recognition or at the previous balance sheet date are recognized in profit or loss for the period, except that (1) exchange differences related to a specific-purpose borrowing denominated
in foreign currency that qualify for capitalization are capitalized as part of the cost of the
qualifying asset during the capitalization period; (2) exchange differences related to hedging
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
instruments for the purpose of hedging against foreign currency risks are accounted for using hedge accounting.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
9. Foreign currency transactions - continued
9.1 Transactions denominated in foreign currencies - continued
When the consolidated financial statements include foreign operation(s), if there is foreign currency monetary item constituting a net investment in a foreign operation, exchange difference arising from changes in exchange rates are recognized as "exchange differences arising on translation of financial statements denominated in foreign currencies " in other comprehensive income, and in profit and loss for the period upon disposal of the foreign operation.
Foreign currency non-monetary items measured at historical cost are translated to the amounts in functional currency at the spot exchange rates at the dates of the transactions, while the amounts in functional currency remain unchanged. Foreign currency non-monetary items measured at fair value are re-translated at the spot exchange rate on the date the fair value is determined. Difference between the re-translated functional currency amount and the original functional currency amount is treated as changes in fair value (including changes of exchange rate) and is recognized in profit and loss or as other comprehensive income.
9.2 Translation of financial statements denominated in foreign currencies
For the purpose of preparing the consolidated financial statements, financial statements of a foreign operation are translated from the foreign currency into RMB using the following method: assets and liabilities on the balance sheet are translated at the spot exchange rate prevailing at the balance sheet date; shareholders' equity items are translated at the spot exchange rates at the dates on which such items arose; all items in the income statement as well as items reflecting the distribution of profits are translated at exchange rates that approximate the actual spot exchange rates on the dates of the transactions; The difference between the translated assets and the aggregate of liabilities and shareholders' equity items is recognized as other comprehensive income and included in shareholders' equity.
Cash flows arising from a transaction in foreign currency and the cash flows of a foreign subsidiary are translated at average exchange rate during the accounting period of consolidated financial statements. The effect of exchange rate changes on cash and cash equivalents is regarded as a reconciling item and presented separately in the cash flow statement as "effect of exchange rate changes on cash and cash equivalents".
The opening balances and the comparative figures of previous year are presented at the translated amounts in the previous year's financial statements.
On disposal of the Group's entire interest in a foreign operation, or upon loss of control over foreign operation due to disposal of certain interest in it or other reasons, the Group transfers the accumulated exchange differences arising on translation of financial statements of this foreign operation attributable to the owners' equity of the Company and presented under owners' equity,
to profit or loss in the period in which the disposal occurs.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
9. Foreign currency transactions - continued
9.2 Translation of financial statements denominated in foreign currencies - continued In case of a disposal of part equity investments or other reason leading to lower interest percentage in foreign operations but does not result in the Group losing control over a foreign operation, the proportionate share of accumulated exchange differences arising on translation of financial statements are re-attributed to minority interests and are not recognized in profit and loss. For partial disposals of equity interests in foreign operations which are associates or joint ventures, the proportionate share of the accumulated exchange differences arising on translation of financial statements of foreign operations is reclassified to profit or loss.
10. Financial instruments
The Group recognizes a financial asset or a financial liability when it becomes a party to the contractual provisions of a financial instrument.
All regular way purchases or sales of financial assets are recognized and derecognized on a trade date basis.
Financial assets and financial liabilities are initially measured at fair value. For financial assets and financial liabilities at fair value through profit or loss, relevant transaction costs are directly recognized in profit or loss; transaction costs relating to other categories of financial assets and financial liabilities are included in the value initially recognized. For accounts receivable recognized that do not contain a significant financing component or a financing component included in the contracts less than one year which are not considered by the Group, which are within the scope of Accounting Standard for Business Enterprises No.14 - Revenue (hereinafter referred to as "new standards for revenue"), transaction prices defined in the standards shall be adopted on initial recognition.
The effective interest method is a method that is used in the calculation of the amortized cost of a financial asset or a financial liability and in the allocation of the interest income or interest expense in profit or loss over the relevant period.
The effective interest rate is the rate that exactly discounts estimated future cash flows through the expected life of the financial asset or financial liability to the gross carrying amount of a financial asset or to the amortized cost of a financial liability. When calculating the effective interest rate, the Group estimates future cash flows by considering all the contractual terms of the financial asset or financial liability (for example, prepayment, extension, call option or similar options) but shall not consider the expected credit losses.
The amortized cost of a financial asset or a financial liability is the amount of a financial asset or a financial liability initially recognized net of principal repaid, plus or less the cumulative amortized amount arising from amortization of the difference between the amount initially recognized and the amount at the maturity date using the effective interest method, net of cumulative credit loss
allowance (only applicable to financial assets).
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.1 Classification, recognition and measurement of financial assets
Subsequent to initial recognition, the Group's financial assets of various categories are subsequently measured at amortized cost, at fair value through other comprehensive income or at fair value through profit or loss.
If contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding, and the financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows, such asset is classified into financial assets measured at amortized cost, which include cash and bank balances, notes receivable ,accounts receivable ,other receivables and long-term receivables etc..
Financial assets that meet the following conditions are subsequently measured at fair value through other comprehensive income ("FVTOCI"): the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling; and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Financial assets at FVTOCI are presented as other debt investments. Other debt investments due within one year (inclusive) since the balance sheet date are presented as non-current assets due within one year. Other debt investments due within one year (inclusive) upon acquisition are presented as other current assets.
On initial recognition, the Group may irrevocably designate non-trading equity instruments, other than contingent consideration recognized through business combination not involving enterprises under common control, as financial assets at FVTOCI on an individual basis. Such financial assets at FVTOCI are presented as other equity instrument.
Financial assets measured at fair value through profit or loss ("FVTPL") include those classified as financial assets at FVTPL and those designated as financial assets at FVTPL, which are presented as held-for-trading financial assets other than derivative financial assets. Such financial assets at FVTPL which may fall due more than one year since the balance sheet date and will be held more than one year are presented as other non-current financial assets.
• Any financial assets that does not qualify for amortized cost measurement or measurement at FVTOCI or designated at FVTOCI are classified into financial assets at FVTPL.
• Upon initial recognition, in order to eliminate or significantly reduce accounting mismatch and qualified hybrid financial instrument combines financial asset with embedded derivatives, the Group will irrevocably designated it as financial liabilities at FVTPL.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.1 Classification, recognition and measurement of financial assets - continued
A financial asset is classified as held for trading if one of the following conditions is satisfied:• It has been acquired principally for the purpose of selling in the near term; or
• On initial recognition it is part of a portfolio of identified financial instruments that the Group manages together and there is objective evidence that the Group has a recent actual pattern of short-term profit-taking; or
• It is a derivative that is not a financial guarantee contract or designated and effective as a hedging instrument.
10.1.1 Financial assets measured at amortized cost
Financial assets measured at amortized cost are subsequently measured at amortized cost using the effective interest method. Gain or loss arising from impairment or derecognition is recognized in profit or loss.
For financial assets measured at amortized cost, the Group recognizes interest income using effective interest method. The Group calculates and recognizes interest income through book value of financial assets multiplying effective interest, except for the following circumstances:• For purchased or originated credit-impaired financial assets with credit impairment, the Group calculates and recognizes its interest income based on amortized cost of the financial asset and the effective interest through credit adjustment since initial recognition. 10.1.2 Financial assets at FVTOCI
Impairment losses or gains related to financial assets at FVTOCI, interest income measured using effective interest method and exchange gains or losses are recognized into profit or loss for the current period, except for the above circumstances, changes in fair value of the financial assets are included in other comprehensive income. Amounts charged to profit or loss for every period equal to the amount charged to profit or loss as it is measured at amortized costs. When the financial asset is derecognized, the cumulative gains or losses previously recognized in other comprehensive income shall be removed from other comprehensive income and recognized in profit or loss.
Non-trading equity instrument investments are designated as financial assets at FVTOCI, the cumulative gains or losses previously recognized in other comprehensive income allocated to the part derecognized are transferred and included in retained earnings. During the period in which the Group holds the non-trading equity instrument, revenue from dividends is recognized in profit or loss for the current period when the Group has established the right of collecting dividends; it is
probable that the associated economic benefits will flow to the Group; and the number of
dividends can be measured reliably.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.1 Classification, recognition and measurement of financial assets - continued
10.1.3 Financial assets at FVTPL
Financial assets at FVTPL are subsequently measured at fair value. Gain or loss arising from changes in fair values and dividends and interests related to the financial assets are recognized in profit or loss.
10.2 Impairment of financial instruments
The Group makes accounting treatment on impairment and recognizes loss allowance for expected credit losses ("ECL") on financial instruments measured at amortized cost, financial instruments classified as at FVTOCI, lease receivables and contract assets.
The Group makes a loss allowance against the amount of lifetime ECL of the contract assets or accounts receivable that exclude significant financing component or do not consider the financing component in the contract within one year arising from transactions adopting New Standards for Revenue, contract assets and accounts receivable that include significant financing component and lease receivables arising from transactions adopting New Standards for Lease.
For financial instruments other than purchased or originated credit-impaired financial assets, the Group assesses changes in credit risks of the relevant financial asset since initial recognition at each balance sheet date. If the credit loss of the financial instrument has been significantly increased since initial recognition, the Group will make a loss allowance at an amount of expected credit loss during the whole life; if not, the Group will make a loss allowance for the financial instrument at an amount in the future 12-month expected credit losses. Except for the financial assets classified as at FVTOCI, increase in or reversal of credit loss allowance is included in profit or loss as loss/gain on impairment. For the financial assets classified as at FVTOCI, the Group recognizes credit loss allowance in other comprehensive income and recognizes the loss/gain on impairment in profit or loss, while the Group does not decrease the carrying amount of such financial assets in the balance sheet.
The Group has made loss allowances against amount of expected credit losses during the previous accounting period. However, if the credit risk of a financial instrument has not increased significantly since initial recognition at the balance sheet date, the Group will measure the loss allowance of that financial instrument at the amount of the expected credit losses in the future 12 months. The reversed amount of loss allowances arising from such circumstances shall be included in profit or loss as impairment gains.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.2 Impairment of financial instruments - continued
10.2.1 Significant increase of credit risk
In assessing whether the credit risk has increased significantly since initial recognition, the Group compares the risk of a default occurring on the financial instrument as at the reporting date with the risk of a default occurring on the financial instrument as at the date of initial recognition. For loan commitments, the date that the Group becomes a party to the irrevocable commitment is considered to be the date of initial recognition in the application of criteria related to the financial instrument for impairment.
In particular, the following information is taken into account when assessing whether credit risk has increased significantly:
• Significant changes in internal price indicators of credit risk as a result of a change in credit risk;
• Other changes in the rates or terms of an existing financial instrument that would be significantly different if the instrument was newly originated or issued at the balance sheet date (such as more stringent covenants, increased amounts of collateral or guarantees, or higher income coverage);
• Significant changes in external market indicators of credit risk for a particular financial instrument or similar financial instruments with the same expected life. These indicators include the credit spread, the credit swap prices for the borrower, the length of time or the extent to which the fair value of a financial asset has been less than its amortized cost and other market information related to the borrower, such as changes in the price of aborrower’s debt and equity instruments;
• Significant changes in actual or expected external credit rating for the financial instruments;
• An actual or expected internal credit rating downgrade for the borrower;
• Adverse changes in business, financial or economic conditions that are expected to cause a significant change in thedebtor’s ability to meet its debt obligations;
• An actual or expected significant change in the operating results of the debtor;
• Significant increases in credit risk on other financial instruments of the same borrower;• Significant adverse change in the regulatory, economic, or technological environment of the debtor;
• Significant changes in the value of the collateral supporting the obligation or in the quality of third-party guarantees or credit enhancements, which are expected to reduce thedebtor’s economic incentive to make scheduled contractual payments or to otherwise have an effect on the probability of a default occurring;
• Significant changes in circumstances expected to reduce thedebtor’s economic incentive
to make scheduled contractual payments;
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.2 Impairment of financial instruments - continued
10.2.1 Significant increase of credit risk - continued
• Expected changes in the loan documentation including an expected breach of contract that may lead to covenant waivers or amendments, interest payment holidays, interest rate step- ups, requiring additional collateral or guarantees, or other changes to the contractual framework of the financial instrument;
• Significant changes in the expected performance and behavior of the debtor;
• Changes in theentity’s credit management approach in relation to the financial instrument;• Past due of contract payment.
At balance sheet date, if the Group judges that the financial instrument solely has lower credit risk, the Group will assume that the credit risk of the financial instrument has not been significantly increased since initial recognition.
10.2.2 Credit-impaired financial assets
When the Group expect the occurrence of one or more events which may cause adverse impact on future cash flows of a financial asset, the financial asset will become a credit-impaired financial assets. Objective evidence that a financial asset is impaired includes but is not limited to the following observable events:
• Significant financial difficulty of the issuer or debtor;
• A breach of contract by the debtor, such as a default or delinquency in interest or principal payments;
• The creditor, for economic or legal reasons relating to thedebtor’s financial difficulty, granting a concession to the debtor;
• It becoming probable that the debtor will enter bankruptcy or other financial
reorganizations;
• The disappearance of an active market for that financial asset because of financial difficulties of the issuer or the debtor;
• Purchase or originate a financial asset with a large scale of discount, which reflects facts of credit loss incurred.
10.2.3 Determination of expected credit loss
The Group uses a provision matrix to determine the credit losses for accounts receivable, contract assets and debt investment based on a portfolio basis. The Group classifies financial instruments into different groups based on common risk characteristics. Common credit risk characteristics
include credit risk rating, the date of initial recognition, remaining contractual maturity, industry
of borrower and geographical location of the borrower etc.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.2 Impairment of financial assets - continued
10.2.3 Determination of expected credit loss - continued
The Group determines expected credit losses of relevant financial instruments using the following methods:
 For a financial asset, a credit loss is the present value of the difference between the contractual cash flows that are due to the Group under the contract and the cash flows that the Group expects to receive;
 For a lease receivable, a credit loss is the present value of the difference between the contractual cash flows that are due to the Group under the contract and the cash flows that the Group expects to receive;
 For a financial asset with credit-impaired at the balance sheet date, but not purchased or originated credit-impaired, credit losses is the difference between theasset’s gross carrying amount and the present value of estimated future cash flows discounted at the financialasset’s original effective interest rate.
The factors reflected in methods of measurement of expected credit losses include an unbiased and probability-weighted amount that is determined by evaluating a range of possible outcomes; time value of money, reasonable and supportable information about past events, current conditions and forecasts on future economic status at balance sheet date without unnecessary additional costs or efforts.
10.2.4 Write-down of financial assets
When the Group no longer reasonably expects that the contractual cash flows of financial assets can be collected in aggregate or in part, the Group will directly write down the carrying amount of the financial asset, which constitutes the derecognition of relevant financial assets.
10.3 Transfer of financial assets
The Group will derecognize a financial asset if one of the following conditions is satisfied:• The contractual rights to the cash flows from the financial asset expire;
• The financial asset has been transferred and substantially all the risks and rewards of ownership of the financial asset is transferred to the transferee; or
• Although the financial asset has been transferred, the Group neither transfers nor retains substantially all the risks and rewards of ownership of the financial asset but does not have retained control of the financial asset.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.3 Transfer of financial assets - continued
If the Group neither transfers nor retains substantially all the risks and rewards of ownership of a financial asset, but retains control of the financial asset, the Group will recognize the financial asset to the extent of its continuing involvement in the transferred financial asset and recognize an associated liability. The Group will measure relevant liabilities as follows:
 For transferred financial assets carried at amortized cost, the carrying amount of relevant liabilities is the carrying amount of financial assets transferred with continuing involvement less amortized cost of the Group's retained rights (if the Group retains relevant rights upon transfer of financial assets) with addition of amortized cost of obligations assumed by the Group (if the Group assumes relevant obligations upon transfer of financial assets). Relevant liabilities are not designated as financial liabilities at fair value through profit or loss. For transferred financial assets carried at fair value, the carrying amount of relevant financial liabilities is the carrying amount of financial assets transferred with continuing involvement less fair value of the Group's retained rights (if the Group retains relevant rights upon transfer of financial assets) with addition of fair value of obligations assumed by the Group (if the Group assumes relevant obligations upon transfer of financial assets). Accordingly, the fair value of relevant rights and obligations shall be measured on an individual basis.
For a transfer of a financial asset categorized into those measured at amortized cost and those measured at FVTOCI in its entirety that satisfies the derecognition criteria, the difference between the carrying amount of the financial asset transferred and the sum of the consideration received from the transfer and accumulated changes in fair value initially recorded in other comprehensive income is recognized in profit or loss. For the non-tradable equity instrument designated as financial assets at FVTOCI, cumulative gain or loss that has been recognized in other comprehensive income should be removed from other comprehensive income but be recognized in retained earnings.
For partial transfer of financial asset that satisfies the derecognition criteria, the carrying amount of the transferred financial asset is allocated between the part that is derecognized and the part that is continuously involved, based on the respective fair values of those parts on transfer date. The difference between (1) the sum of the consideration received for the part derecognized and any cumulative gain or loss allocated to the part derecognized which has been previously recognized in other comprehensive income, and (2) the carrying amount allocated to the part derecognized on derecognition date, is recognized in profit or loss. For non-tradable equity instrument designated as financial assets at FVTOCI, cumulative gain or loss that has been recognized in other comprehensive income should be removed from other comprehensive income but be recognized in retained earnings.
For a transfer of a financial asset in its entirety that does not satisfy the derecognition criteria, the
Group will continuously recognize the transferred financial asset in its entirety. Considerations
received due to transfer of assets should be recognized as a liability upon receipts.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.4 Classification of financial liabilities equity instruments
Financial instruments issued by the Group are classified into financial liabilities or equity instruments on the basis of the substance of the contractual arrangements and the economic nature not only its legal form, together with the definition of financial liability and equity instruments on initial recognition.
10.4.1 Classification, recognition and measurement of financial liabilities
On initial recognition, financial liabilities are classified into financial liabilities at FVTPL and other financial liabilities.
10.4.1.1 Financial liabilities at FVTPL
Financial liabilities at FVTPL consist of financial liabilities held for trading (including derivatives classified as financial liabilities) and those designated as at FVTPL. Financial liabilities at FVTPL are presented as held-for-trading financial liabilities, except for derivative financial liabilities presented separately.
A financial liability is classified as held for trading if one of the following conditions is satisfied:• It has been acquired principally for the purpose of repurchasing in the near term; or• It is part of a portfolio of identified financial instruments that the Group manages together on initial recognition and there is objective evidence that the Group recently has an actual pattern of short-term profit-taking; or
• It is a derivative that is not a financial guarantee contract or designated and put into effect as a hedging instrument.
A financial liability may be designated as at FVTPL on initial recognition when one of the following conditions is satisfied:
• Such designation eliminates or significantly reduces accounting mismatch; or
• The Group makes management and performance evaluation on a fair value basis, in accordance with the Group's formally documented risk management or investment strategy, and reports to key management personnel on that basis.
• The qualified hybrid financial instrument combines financial assets with embedded derivatives.
Transaction financial liabilities are subsequently measured at fair value. Any gains or losses arising from changes in the fair value and any dividend or interest expenses paid on the financial liabilities are recognized in profit or loss.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.4 Classification of financial liabilities equity instruments - continued
10.4.1 Classification, recognition and measurement of financial liabilities - continued 10.4.1.1 Financial liabilities at FVTPL - continued
The amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of that liability shall be presented in other comprehensive income; Other changes in fair values are included in profit or loss for the current period. Upon the derecognition of such liability, the accumulated amount of change in fair value that is attributable to changes in the credit risk of that liability, which is recognized in other comprehensive income, is transferred to retained earnings. Any dividend or interest income earned on the financial liabilities are recognized in profit or loss. If the impact of the change in credit risk of such financial liability dealt with in the above way would create or enlarge an accounting mismatch in profit or loss, the Group shall present all gains or losses on that liability (including the effects of changes in the credit risk of that liability) in profit or loss.
10.4.1.2 Other financial liabilities
Other financial liabilities, except for financial liabilities arising from transfer of financial assets does not satisfy derecognition criteria or continue involvement of transferred financial assets, are subsequently measured at amortized cost, with gain or loss arising from derecognition or amortization recognized in profit or loss.
That the Group and its counterparty modify or renegotiate the contract does not result in derecognition of a financial liability subsequently measured at amortized cost but result in changes in contractual cash flows; The Group will recalculate the carrying amount of the financial liability, with relevant gain or loss recognized in profit or loss. The Group will determine the carrying amount of the financial liability based on the present value of renegotiated or modified contractual cash flows discounted at the financial liability's original effective interest rate. For all costs or expenses arising from modification or renegotiation of the contract, the Group will adjust the modified carrying amount of the financial liability and make amortization during the remaining term of the modified financial liability.
10.4.1.3 Financial guarantee contracts
A financial guarantee contract is a contract that requires the issuer to make specified payments to reimburse the holder of the contract for a loss occuring because a specified debtor fails to make payment when due in accordance with the original or modified terms of a debt instrument. Subsequent to initial recognition, financial guarantee contracts that are not designated as financial liabilities at fair value through profit or loss are measured at the higher of: (1) amount of loss provision, and (2) fluctuations in the cumulative amortization amount determined based on new standards for revenue.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
10. Financial instruments - continued
10.4 Classification of financial liabilities equity instruments - continued
10.4.2 Derecognition of financial liabilities
The Group derecognizes a financial liability (or part of it) when the underlying present obligation (or part of it) is discharged. An agreement between the Group (the debtor) and the creditor to replace the original financial liability with a new financial liability with substantially different terms is accounted for as an extinguishment of the original financial liability and the recognition of a new financial liability.
When the Group derecognizes a financial liability or a part of it, it recognizes the difference between the carrying amount of the financial liability (or part of the financial liability) derecognized and the consideration paid (including any non-cash assets transferred or new financial liabilities assumed) in profit or loss.
10.4.3 Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities. Issuing repurchasing, selling, canceling equity instruments of the Group are recognized as changes of equity. Changes of fair value of equity instruments is not recognized by the Group. Transaction costs related to equity transactions are deducted from equity.
The Group recognizes the distribution to holders of the equity instruments as distribution of profits, dividends paid do not affect total amount of shareholders' equity.
10.5 Offsetting financial assets and financial liabilities
Where the Group has a legal right that is currently enforceable to set off the recognized financial assets and financial liabilities, and intends either to settle on a net basis, or to realize the financial asset and settle the financial liability simultaneously, a financial asset and a financial liability shall be offset and the net amount is presented in the balance sheet. Financial assets and financial liabilities shall be presented separately in the balance sheet and shall not be offset except for the above circumstances.
11. Accounts receivable
The Group makes internal credit ratings on customers and determines expected loss rate of accounts receivable. Basis for determining ratings and methods for bad debt provision are as follows:
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
11. Accounts receivable - continued
||||||
|-|-|-|-|-|
|||||Average expected loss|
|Internal credit rating||Basis for determining portfolio|||
|||||rate (%)|
||Customers can make repayments withincredit term and have good credit recordsbased on historical experience. Theprobability of unpayment of due amount areextremely low in the foreseeable future.||0.00-0.10||
|A|||||
||The customer may have overdue paymentbased on historical experience but they canmake repayments.||0.10-0.30||
|B|||||
||The evidences indicate that the overdue creditrisks of the customer are significantlyincreased and there is probability ofunpayment and default.||0.30-50.00||
|C|||||
||The evidences indicate that the accountsreceivable are impaired and the customer hassignificant financial difficulty. The amountscannot be recovered in the foreseeable future.||50.00-100.00||
|D|||||

12. Inventories
12.1 Categories of inventories
Inventories include raw materials, merchandise reusable materials etc. Inventories are initially measured at cost. Cost of inventories comprises all costs of purchase, conversion and other expenditures incurred in bringing the inventories to their present location and condition. 12.2 Valuation method of inventories upon delivery
The actual cost of inventories upon delivery is calculated using the weighted average method. 12.3 Basis for determining net realizable value of inventories and provision methods for decline in value of inventories
At the balance sheet date, inventories are measured at the lower of cost and net realizable value. If the cost of inventories is higher than the net realizable value, a provision for decline in value of inventories is made. Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs of completion, the estimated costs necessary to make the sale and
relevant taxes. Net realizable value is determined on the basis of clear evidence obtained, after
taking into consideration the purposes of inventories being held and effect of post balance sheet
events.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
12. Inventories - continued
12.3 Basis for determining net realizable value of inventories and provision methods for decline in value of inventories - continued
Provision for decline in value of other inventories is made based on the excess of cost of inventory over its net realizable value on an item-by-item basis.
After the provision for decline in value of inventories is made, if the circumstances that previously caused inventories to be written down below cost are eliminated exist so that the net realizable value of inventories is higher than their cost, the original provision for decline in value is reversed and the reversal is included in profit or loss for the period.
12.4 Inventory count system
The inventory count system adapted is the perpetual inventory system.
12.5 Amortization methods for low cost and short-lived consumable items and packaging materials
Packaging materials and low cost and short-lived consumable items are amortized using the immediate write-off method.
13. Assets held for sale
When the Group withdraw the book value of certain assets or disposal group mainly through disposal instead of continual application, the assets should be classified as held-for-sale assets. Assets or disposal group classified as held-for-sale assets should meet following conditions:• The current status is available for immediate distribution according to similar transactions of this category of assets or disposal group;
• The transaction is likely to occur, i.e. the Group has made its resolution over the distribution arrangements and acquired purchase commitment, and the distribution is going to be fulfilled within a year.
If the holding company loses control of its subsidiary for reasons such as subsidiary disposal regardless of whether the holding company still keeps part of equity investment, once the proposed investment disposal meets the requirements of being classified as available for sale assets in the holding company's individual statement, all assets and liabilities of the subsidiary should be classified as held-for-sale in consolidated financial statement.
The group's non-current assets and disposal group are measured at the lower of the book value and the net value of fair value less costs to sell. Once the book value is higher than the net value of fair value less costs to sell, the book value should be adjusted to the net value and the excess should be recognized as impairment losses and provision for held-for-sale assets impairment
should be made. A gain and a reverse in the previous provision for held-for-sale assets
impairment can be recognized for any increase in fair value less costs to sell at subsequent
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
balance sheet dates, to the extent that it is not in excess of the cumulative impairment loss that has been recognized.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
13. Assets held for sale - continued
Non-current held-for-sale assets is not subject to depreciation and amortization. The creditor interest and other expenses of disposal group classified as held-for-sale asset should still be recognized.
Once the associate or joint venture equity investment is completely or partly classified as held- for-sale assets, the classified part of the investment is not subject to equity method measurement. 14. Long-term equity investments
14.1 Basis for determining joint control and significant influence over investee
Control is archived when the Group has the power over the investee has the rights to variable returns from its involvement with the investee; and has the ability to use its power to affect its returns. Joint control is the contractually agreed sharing of control over an economic activity, and exists only when the strategic financial and operating policy decisions relating to the activity require the unanimous consent of the parties sharing control. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies. When determining whether an investing enterprise is able to exercise control or significant influence over an investee, the effect of potential voting rights of the investee (for example, warrants and convertible debts) held by the investing enterprises or other parties that are currently exercisable or convertible shall be considered.
14.2 Determination of investment cost
For a long-term equity investment acquired through a business combination involving enterprises under common control, the investment cost of the long-term equity investment is the attributable share of the carrying amount of the shareholders' equity of the acquiree at the date of combination. The difference between the initial investment cost and the carrying amount of cash paid, non-cash assets transferred and liabilities assumed shall be adjusted to capital reserve. If the balance of capital reserve is not sufficient, any excess shall be adjusted to retained earnings. If the consideration of the combination is satisfied by the issue of equity securities, the initial investment cost of the long-term equity investment shall be the share of the party being absorbed of the owners' equity in the consolidated financial statements of the ultimate controlling party at the date of combination. The aggregate face value of the shares issued shall be accounted for as share capital. The difference between the initial investment cost and the aggregate face value of the shares issued shall be adjusted to capital reserve. If the balance of capital reserve is not sufficient, any excess shall be adjusted to retained earnings.
For a long-term equity investment acquired through business combination not involving enterprises under common control, the investment cost of the long-term equity investment acquired is the cost of acquisition.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
14. Long-term equity investments - continued
14.2 Determination of investment cost - continued
The absorbing party's or the purchaser's intermediary expenses (fees in respect of auditing, legal services, valuation and consultancy services, etc.) and other administrative expenses attributable to the business combination are recognized in profit or loss in the periods in which they ocurred. The long-term equity investment acquired otherwise than through a business combination is initially measured at its cost. When the entity is able to exercise significant influence or joint control (but not control) over an investee due to additional investment, the cost of long-term equity investments is the sum of the fair value of previously-held equity investments determined in accordance with Accounting Standard for Business Enterprises No.22 - Financial Instruments: Recognition and Measurement of (ASBE No. 22) and the additional investment cost.
14.3 Subsequent measurement and recognition of profit or loss
14.3.1 A long-term equity investment accounted for using the cost method
Long-term equity investments in subsidiaries are accounted for using the cost method in the Company's separate financial statements. A subsidiary is an investee that is controlled by the Group.
Under the cost method, a long-term equity investment is measured at initial investment cost. Additional or withdrawing investment would affect the cost of long-term equity investment. Investment income is recognized in the period in accordance with the attributable share of cash dividends or profit distributions declared by the investee.
14.3.2 A long-term equity investment accounted for using the equity method
Except associate and joint venture investment completely or partly classified as available for sale, the Group accounts for investment in associates and joint ventures using the equity method. An associate is an entity over which the Group has significant influence and a joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the joint arrangement.
Under the equity method, where the initial investment cost of a long-term equity investment exceeds the Group's share of the fair value of the investee's identifiable net assets at the time of acquisition, no adjustment is made to the initial investment cost. Where the initial investment cost is less than the Group's share of the fair value of the investee's identifiable net assets at the time of acquisition, the difference is recognized in profit or loss for the period, and the cost of the long- term equity investment is adjusted accordingly.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
14. Long-term equity investments - continued
14.3.2 A long-term equity investment accounted for using the equity method - continued Under the equity method, the Group recognizes its share of the other comprehensive income and net profit or loss of the investee for the period as other comprehensive income and investment income or loss respectively for the period, and the carrying amount of the long-term equity investment is adjusted accordingly. The carrying amount of the investment shall be reduced by the portion of any profit distributions or cash dividends declared by the investee that is distributed to the investing enterprise. The investing enterprise shall adjust the carrying amount of the long-term equity investment for other changes in owners' equity of the investee (other than net profits or losses, other comprehensive income and profit distribution), and include the corresponding adjustment in capital reserve. The Group recognizes its share of the investee's net profit or loss based on the fair value of the investee's individually identifiable assets at the acquisition date after making appropriate adjustments. Where the accounting policies and accounting period adopted by the investee are different from those of the investing enterprise, the investing enterprise shall adjust the financial statements of the investee to conform to its own accounting policies and accounting period, and recognize other comprehensive income and investment income or losses based on the adjusted financial statements. Unrealized profits or losses resulting from the Group's transactions and assets invested or sold that are not recognized as business transactions with its associates and joint ventures are recognized as investment income or loss to the extent that those attributable to the Group's, equity interest are eliminated. However, unrealized losses resulting from the Group's transactions with its associates and joint ventures which represent impairment losses on the transferred assets are not eliminated.
The Group discontinues recognizing its share of net losses of the investee after the carrying amount of the long-term equity investment together with any long-term interests that in substance form part of its net investment in the investee are reduced to zero. Except that if the Group has incurred obligations to assume additional losses, a provision is recognized according to the obligation expected, and recorded in the investment loss for the period. Where net profits are subsequently made by the investee, the Group resumes recognizing its share of those profits only after its share of the profits exceeds the share of losses previously not recognized. If the assets sold by the Group constitute a business, the difference between the consideration acquired and the book value shall be recorded to profit or loss in full amount.
14.4 Disposal of long-term equity investments
On disposal of a long-term equity investment, the difference between the proceeds actually received and receivable and the carrying amount is recognized in profit or loss for the period. For long-term equity investments accounted for using the equity method, if the remaining interest after disposal is still accounted for using the equity method, other comprehensive income previously recognized for using the equity method is accounted for on the same basis as would have been required if the investee had directly disposed of related assets or liabilities, and transferred to profit or loss for the period on a pro rata basis; owners' equity recognized due to changes in other owners' equity of the investee (other than net profit or loss, other comprehensive
income and profit distribution) is transferred to profit or loss for the period on a pro rata basis.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
14. Long-term equity investments - continued
14.4 Disposal of long-term equity investments - continued
For long-term equity investments accounted for using the cost method, if the remaining interest after disposal is still accounted for using the cost method, other comprehensive income previously recognized for using the equity method or in accordance with the standards for the recognition and measurement of financial instruments before obtaining the control over the investee, is accounted for on the same basis as would have been required if the investee had directly disposed of related assets or liabilities, and transferred to profit or loss for the period on a pro rata basis; changes in other owners' equity in the investee's net assets recognized under the equity method (other than net profit or loss, other comprehensive income and profit distribution) is transferred to profit or loss for the period on a pro rata basis.
15. Investment properties
Investment property is property held to earn rentals or for capital appreciation or both. It includes a land use right that is leased out; a land use right held for transfer upon capital appreciation; and a building that is leased out.
An investment property is measured initially at cost. Subsequent expenditures incurred for such investment property are included in the cost of the investment property if it is probable that economic benefits associated with an investment property will flow to the Group and the subsequent expenditures can be measured reliably, other subsequent expenditures are recognized in profit or loss in the period in which they are incurred.
The Group uses the cost model for subsequent measurement of investment property, and adopts a depreciation or amortization policy for the investment property which is consistent with that for buildings or land use rights.
When an investment property is sold, transferred, retired or damaged, the Group recognizes the amount of any proceeds on disposal net of the carrying amount and related taxes in profit or loss for the period.
16. Fixed assets
16.1 Recognition criteria for fixed assets
Fixed assets are tangible assets that are held for use in the production or supply of goods or services, for rental to others, or for administrative purposes, and have useful lives of more than one accounting year. A fixed asset is recognized only when it is probable that economic benefits associated with the asset will flow to the Group and the cost of the asset can be measured reliably. Fixed assets are initially measured at cost. Upon being restructured into a stock company, the fixed assets initially contributed by the state-owned shareholders are recognized based on the valuation amounts confirmed by the state-owned assets administration department.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
16. Fixed assets - continued
16.1 Recognition criteria for fixed assets - continued
Subsequent expenditures incurred for the fixed asset are included in the cost of the fixed asset and if probable the economic benefits associated with the asset will flow to the Group and the subsequent expenditures can be measured reliably. Meanwhile the carrying amount of the replaced part is derecognized. Other subsequent expenditures are recognized in profit or loss in the period in which they are incurred.
16.2 Depreciation of each category of fixed assets
A fixed asset is depreciated over its useful life using the straight-line method starting from the month subsequent to the one in which it is ready for intended use. The useful life, estimated net residual value rate and annual depreciation rate of each category of fixed assets are as follows:
||||||||
|-|-|-|-|-|-|-|
|||Estimated||Estimated||Annual|
|Category|||||||
|||useful lives||residual rate (%)||depreciation rate (%)|
|Port and terminal facilities|5-99 years||5.00||0.96-19.00||
|Buildings|10-50 years||5.00||1.90-9.50||
|Mechanical equipment, furniture and|3-20 years||5.00||4.75-31.67||
|others|||||||
|Motor vehicles, cargo ships and tugboats|5-25 years||5.00||3.80-19.00||

 Estimated net residual value of a fixed asset is the estimated amount that the Group would currently obtain from the disposal of the asset, after deducting the estimated costs of disposal, if the asset was already of age and at the end of its useful life.
16.3 Other explanations
If a fixed asset is upon disposal or no future economic benefits are expected to be generated from its use or disposal, the fixed asset is derecognized. When a fixed asset is sold, transferred, retired or damaged, the amount of any proceeds on disposal of the asset net of the carrying amount and related taxes is recognized in profit or loss of the period.
The Group reviews the useful life and estimated net residual value of a fixed asset and the depreciation method applied at least once at each financial year-end, and account for any change as a change in an accounting estimate.
17. Construction in progress
Construction in progress is measured at its actual costs. The actual costs include various
construction expenditures during the construction period, borrowing costs capitalized before it is
ready for intended use and other relevant costs. Construction in progress is not depreciated.
Construction in progress is transferred to a fixed asset when it is ready for intended use.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
18. Borrowing Costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying asset are capitalized when expenditures for such asset and borrowing costs are incurred and activities relating to the acquisition, construction or production of the asset that is necessary to prepare the asset for its intended use or sale have commenced. Capitalization of borrowing costs ceases when the qualifying asset being acquired, constructed or produced becomes ready for its intended use or sale. Capitalization of borrowing costs is suspended during periods in which the acquisition, construction or production of a qualifying asset is interrupted abnormally and when the interruption lasts for a continuous period more than 3 months. Capitalization is suspended until the acquisition, construction or production of the asset is resumed. Other borrowing costs are recognized as an expense in the period in which they are incurred.
Where funds are borrowed under specific-purpose borrowing, the amount of interest to be capitalized is the actual interest expense incurred on that borrowing for the period less any bank interest earned from depositing the borrowed funds before being used on the asset or any investment income on the temporary investment of those funds. Where funds are borrowed under general-purpose borrowings, the Group determines the amount of interest to be capitalized on such borrowings by applying a capitalization rate to the weighted average of the excess of cumulative expenditures on the asset over the amounts of specific-purpose borrowings. The capitalization rate is the weighted average of the interest rates applicable to the general-purpose borrowings. During the capitalization period, exchange rate differences related to a specific- purpose borrowing denominated in foreign currency are all capitalized. Exchange rate differences in connection with general-purpose borrowings are recognized in profit or loss in the period in which they are incurred.
19. Intangible assets
19.1 Intangible assets
Intangible assets include land use rights and port operating right.
An intangible asset is measured initially at cost. Upon being restructured into a stock company, the intangible assets initial contributed by the state-owned shareholders are recognized based on the valuation amounts confirmed by the state-owned assets administration department. When an intangible asset with a finite useful life is available for use, its original cost is amortized over its estimated useful life. Intangible assets with an indefinite useful life are not amortized. The amortization method, estimated useful lives and estimated net residual value of various intangible assets are as follows:
||||||||
|-|-|-|-|-|-|-|
|||||Estimated useful lives||Residual value|
|Category||Amortization method|||||
|||||(years)||(%)|
|Land use rights|Straight-line method||40-99||-||
|Port operating rights|Straight-line method||30-35||-||
|Others|Straight-line method||5-50||-||

For an intangible asset with a finite useful life, the Group reviews the useful life and amortization
method at the end of the period, and makes adjustments when necessary.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
19. Intangible assets - continued
19.2 Internal research and development expenditure
Expenditure incurred during the research phase are recorded to profit or loss for the period upon incurring.
Costs incurred during the development phase, if satisfying all of the following criteria, are recognized as intangible assets. Costs incurred during the development phase, if not satisfying the following criteria are recorded to profit or loss for the period:
• It is technically feasible to complete the intangible asset so that it will be available for use or sale;
• The Group has the intention to complete the intangible asset and use or sell it;
• The Group can demonstrate the ways in which the intangible asset will generate economic benefits, including the evidence of the existence of a market for the output of the intangible asset or the intangible asset itself or, if it is to be used internally, the usefulness of the intangible asset;
• The availability of adequate technical, financial and other resources to complete the development and the ability to use or sell the intangible asset; and
• The expenditure attributable to the intangible asset during its development phase can be reliably measured.
If the expenditures cannot be distinguished between the research phase and development phase, the Group recognizes all of them in profit or loss for the period.
20. Impairment of long-term assets
The Group assesses at the balance sheet date whether there is any indication that the long-term equity investments, investment properties measured at cost method, construction in progress, fixed assets and intangible assets with a finite useful life may be impaired. If there is any indication that such assets may be impaired, recoverable amounts are estimated for such assets. Intangible assets with indefinite useful life and intangible assets not yet available for use are tested for impairment annually, irrespective of whether there is any indication that the assets may be impaired.
Recoverable amount is estimated on individual basis. If it is not practical to estimate the recoverable amount of an individual asset, the recoverable amount of the asset group to which the asset belongs will be estimated. The recoverable amount of an asset is the higher of its fair value less costs of disposal and the present value of the future cash flows expected to be derived from the asset. If the recoverable amount of an asset or an asset group is less than its carrying amount, the deficit is accounted for as an impairment loss and is recognized in profit or loss.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
20. Impairment of long-term assets - continued
Goodwill is tested for impairment at least at the end of each year. For the purpose of impairment testing, goodwill is considered together with the related assets groups, i.e., goodwill is reasonably allocated to the related assets groups or each of assets groups expected to benefit from the synergies of the combination. In testing an assets group with goodwill for impairment, an impairment loss is recognized if the recoverable amount of the assets group or sets of assets groups (including goodwill) is less than its carrying amount. The impairment loss is firstly allocated to reduce the carrying amount of any goodwill allocated to such assets group or sets of assets groups, and then to the other assets of the group pro-rata basis on the basis of the carrying amount of each asset (other than goodwill) in the group.
Once the impairment loss of above-mentioned asset is recognized, it shall not be reversed in any subsequent period.
21. Long-term prepaid expenses
Long-term prepaid expenses represent expenses incurred that should be borne and amortized over the current and subsequent periods (together of more than one year). Long-term prepaid expenses are amortized using the straight-line method over the expected periods in which benefits are derived.
22. Employee benefits
22.1 The accounting treatment of short-term employee benefits
Actually occurred short-term employee benefits are recognized as liabilities, with a corresponding charge to the profit or loss for the period or in the costs of relevant assets in the accounting period in which employees provide services to the Group. Staff welfare expenses incurred by the Group are recognized in profit or loss for the period or the costs of relevant assets based on the actually occurred amounts when it actually occurred. Non-monetary staff welfare expenses are measured at fair value.
Payment made by the Group of social security contributions for employees such as premiums or contributions on medical insurance, work injury insurance and maternity insurance, etc. and payments of housing funds, as well as union running costs and employee education costs provided in accordance with relevant requirements, are calculated according to prescribed bases and percentages in determining the amount of employee benefits and recognized as relevant liabilities, with a corresponding charge to the profit or loss for the period or the costs of relevant assets in the accounting period in which employees provide services.
22.2 The accounting treatment of post-employment benefits
Post-employment benefits are classified in defined contribution plans and defined benefit plans.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
22. Employee benefits - continued
22.2 The accounting treatment of post-employment benefits - continued
During the accounting period of rendering service to employees of the Group, amount which should be paid according to defined contribution plans is recognized as liabilities, and recognized in profit or loss or related costs of assets.
For defined benefit plans, the Group calculates defined benefit plan obligations using projected unit credit method and the service cost resulting from employee service in the current period is recorded in the profit or loss or the cost of related assets. Defined benefit costs are categorized as follows:
• Service cost (including current service cost, past service cost, as well as gains and losses on settlements);
• Net interest of net liabilities or assets of defined benefit plan (including interest income of planned assets, interest expenses of defined benefit plan liabilities and effect of asset ceiling); and
• Changes arising from remeasurement of net liabilities or net assets of defined benefit plans Service costs and net interest of net liabilities and net assets of defined benefit plans are recognized in profit or loss of current period or costs of related assets. Remeasurement of the net defined benefit liability (asset) (including actuarial gains and losses, the return on plan assets, excluding amounts included in net interest on the net defined benefit liability (asset), and any change in the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability (asset)) are recognized in other comprehensive income.
22.3 The accounting treatment of termination benefits
When the Group provides termination benefits to employees, employee benefit liabilities are recognized for termination benefits, with a corresponding charge to the profit or loss for the period at the earlier of:
• When the Group cannot unilaterally withdraw the offer of termination benefits because of the termination plan or a curtailment proposal; and
• When the Group recognizes costs or expenses related to restructuring that involves the payment of termination benefits.
23. Provisions
Provisions are recognized when the Group has present obligation related with contingencies, it is probable that the Group will be required to settle that obligation causing an outflow of economic benefits, and a reliable estimate can be made of the amount of the obligation.
The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at balance sheet date, taking into account the risks, uncertainties and time
value of money surrounding the obligation. When a provision is measured using the cash flows
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
estimated to settle the present obligation, its carrying amount is the present value of those cash flows where the effect of the time value of money is material.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
23. Provisions - continued
When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, a receivable is recognized as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable should not exceed the carrying amount of provisions.
24. Revenue
The Group's revenue is mainly from the following business types:
• Port service;
• Bonded logisticsservice；
• Other business such as property development and investment.
The Group recognizes revenue based on the transaction price allocated to such performance obligation when a performance obligation is satisfied, i.e. when "control" of the goods or services underlying the particular performance obligation is transferred to the customer. A performance obligation represents the commitment that a good and service that is distinct shall be transferred by the Group to the customer. Transaction price refers to the consideration that the Group is expected to charge due to the transfer of goods or services to the customer, but it does not include payments received on behalf of third parties and amounts that the Group expects to return to the customer.
If one of the following criteria is met and it is a performance obligation performed over time, the Group recognizes the revenue within a certain period of time according to the progress of the performance:
• The customer simultaneously receives and consumes the benefits provided by the Group's performance as the Group performs;
• The customer is able to control the goods under construction in the course of the Group's performance;
• The goods produced by the Group during the performance of the contract are irreplaceable and the Group has the right to charge for the accumulated part of the contract that has been performed so far during the whole contract period. Otherwise, the Group recognizes revenue at a certain point in time when "control" of the goods or services is transferred to the customer.
The Group adopts input method, i.e. the value of goods or services transferred to customers to determine the appropriate progress of performance. Where the progress cannot be determined reasonably, the revenue is recognized based on the amount of cost that is expected to be compensated based on the cost already incurred, until the progress of performance is reasonably determined.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
24. Revenue - continued
Contract asset refers to the Group's right to consideration in exchange for goods or services that the Group has transferred to a customer when that right is conditioned on something other than the passage of time. The Group's unconditional (i.e., depending on the passage of time only) right to receive consideration from the customer is separately presented as receivables. Contract liabilities refers to the Group's obligation to transfer goods or services to a customer for which the Group has received consideration from the customer. Contract assets and contract liabilities under the same contract are set out on a net basis.
If the contract includes two or more performance obligations, at contract inception, the Group allocates the transaction price to single performance obligation according to relative proportion of the stand-alone selling prices of the goods or services promised by single performance obligation. However, where there is conclusive evidence that the contract discount or variable consideration is only related to one or more (not all) performance obligations in the contract, the Group shall allocate the contract discount or variable consideration to relevant one or more performance obligations. The stand-alone selling price is the price at which the Group would sell a promised good or service separately to a customer. If a stand-alone selling price is not directly observable, the Group shall consider all information that is reasonably available to the Group and maximize the use of observable inputs and apply estimates methods consistently in similar circumstances. If the contract includes significant financing component, the Group determines the transaction price based on the amount payable under the assumption that the customer pays that amount payable in cash when "control" of the goods or services is obtained by the customer. The difference between the transaction price and the contract consideration shall be amortized within the contract period using effective interest rate. If the Group expects, at contract inception, that the period between when the Group transfers a promised good or service to a customer and when the customer pays for that good or service will be one year or less, the Group needs not to consider the significant financing component.
24.1 Principal and agent
The Group determines whether it is a principal or an agent at the time of the transaction based on whether it owns the "control" of the goods or services before the transfer of such goods or services to the customer. The Group is a principal if it controls the specified good or service before that good or service is transferred to a customer, and the revenue shall be recognized based on the total consideration received or receivable. Otherwise, the Group is an agent, and the revenue shall be recognized based on the amount of commission or handling fee that is expected to be charged,which is determined based on the net amount of the total consideration received or receivable after deducting the prices payable to other related parties or according to the established commission amount or proportion.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
24. Revenue - continued
24.2 Costs to fulfill a contract
If the costs incurred in fulfilling a contract are not within the scope of other standard other than the new standards for revenue, the Group shall recongnize an asset from the costs incurred to fulfill a contract only if those costs meet all of the following criteria:
• The costs relate directly to a contract or to an anticipated contract that the Group can specifically identify;
• The costs generate or enhance resources of the entity that will be used in satisfying performance obligations in the future;
• The costs are expected to be recovered.
The asset mentioned above shall be amortized on the basis that is consistent with the transfer to the customer of the goods or services to which the asset relates and recognizes in profit or loss for the period.
24.3 Impairment of contract costs
In determination of impairment losses of assets related to contract costs, firstly impairment losses of other assets related to the contract recognized based on other relevant accounting standards; secondly, the Group shall recognized an impairment loss to the extent that the carrying amount of an asset exceeds: (1) the remaining amount of consideration that the Group expects to receive in exchange for the goods or services to which the asset relates; (2) the estimated costs that relate to providing those goods or services.
The Group shall, after the impairment has been provided, recognize in profit or loss a reversal of some or all of an impairment loss previously recognized when the impairment conditions no longer exist or have improved. The increased carrying amount of the asset shall not exceed the carrying amount that would have been determined if no impairment loss had been recognized previously.
25. Government grants
Government grants are transfers of monetary assets or non-monetary assets from the government to the Group at no consideration. A government grant is recognized only when the Group can comply with the conditions attached to the grant and the Group will receive the grant.
If a government grant is in the form of a transfer of a monetary asset, it is measured as the amount received or receivable.
25.1 The accounting treatment of government grants related to assets
Government grants, such as special funds for modern logistics project and special funds for energy-saving and emission reduction of transportation, are government grants related to assets as they are all related to the construction and use of assets.
A government grant related to an asset is recognized as deferred income, and evenly amortized to
profit or loss over the useful life of the related asset.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
25. Government grants - continued
25.2 The accounting treatment of government grants related to income
The Group's government grant, such as financial support funds of business tax converted to VAT and reward for energy saving, if used to compensate the related expenses or losses to be incurred in subsequent periods, are determined as government grant relating to income.
A government grant relating to income, if used to compensate the related cost, expenses or losses to be incurred in subsequent periods, is determined as deferred income and recognized in profit or loss over the periods in which the related costs are recognized; if used to compensate the related cost, expenses or losses already incurred, it is recognized immediately in profit or loss for the period.
A government grant relating to the Group's daily activities, is recognized in other income in line with the nature of economic transaction. A government grant not relating to the Group's daily activities, is recognized in non-operating income.
26. Deferred tax assets/ deferred tax liabilities
The income tax expenses include current income tax and deferred income tax.
26.1 Current income tax
At the balance sheet date, current income tax liabilities (or assets) for the current and prior periods are measured at the amount expected to be paid (or recovered) according to the requirements of tax laws.
26.2 Deferred tax assets and deferred tax liabilities
For temporary differences between the carrying amounts of certain assets or liabilities and their tax base, or between the nil carrying amount of those items that are not recognized as assets or liabilities and their tax base that can be determined according to tax laws, deferred tax assets and liabilities are recognized using the balance sheet liability method.
Deferred tax liabilities are generally recognized for all taxable temporary differences. Deferred tax assets for deductible temporary differences are recognized to the extent that it is probable that taxable profits will be available against which the deductible temporary differences can be utilized. However, for temporary differences associated with the initial recognition of goodwill and the initial recognition of an asset or liability arising from a transaction (not a business combination) that affects neither the accounting profit nor taxable profits (or deductible losses) at the time of transaction, no deferred tax asset or liability is recognized.
For deductible losses and tax credits that can be carried forward, deferred tax assets are recognized to the extent that it is probable that future taxable profits will be available against which the deductible losses and tax credits can be utilized.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
26. Deferred tax assets/ deferred tax liabilities - continued
26.2 Deferred tax assets and deferred tax liabilities - continued
Deferred tax liabilities are recognized for taxable temporary differences associated with investments in subsidiaries and associates, and interests in joint ventures, except where the Group is able to control the timing of the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary differences associated with such investments and interests are only recognized to the extent that it is probable that there will be taxable profits against which to utilize the benefits of the temporary differences and they are expected to reverse in the foreseeable future. At the balance sheet date, deferred tax assets and liabilities are measured at the tax rates applicable in the period in which the asset is realized or the liability is settled according to tax laws.
Current and deferred tax expenses or income are recognized in profit or loss for the period, except when they arise from transactions or events that are directly recognized in other comprehensive income or in equity, in which case they are recognized in other comprehensive income or in equity, and when they arise from business combinations, in which case they adjust the carrying amount of goodwill.
At the balance sheet date, the carrying amount of deferred tax assets is reviewed and reduced if it is no longer probable that sufficient taxable profits will be available in the future to allow the benefit of deferred tax assets to be utilized. Any such reduction in amount is reversed when it becomes probable that sufficient taxable profits will be available.
26.3 Offset of income tax
When the Group has a legal right to settle on a net basis and intends either to settle on a net basis or to realize the assets and settle the liabilities simultaneously, current tax assets and current tax liabilities are offset and presented on a net basis.
When the Group has a legal right to settle current tax assets and liabilities on a net basis, and deferred tax assets and deferred tax liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities which intend either to settle current tax assets and liabilities on a net basis or to realize the assets and liabilities simultaneously, in each future period in which significant amounts of deferred tax assets or liabilities are expected to be reversed, deferred tax assets and deferred tax liabilities are offset and presented on a net basis.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
27. Leases
If one party to the contract conveys the right to control the use of one or more identified assets for a period of time in exchange for consideration, the contract is, or contains, a lease. For determining whether the contract has conveyed the right to control the use of the identified assets for a period of time, the Group assesses whether customers in the contract have the right to obtain almost all economic benefits arising from the use of identified assets over the use period, and the right to lead the use of identified assets over the use period.
27.1 The accounting treatment of the Group as lessee
27.1.1 Recognition and initial measurement
At the commencement date of a lease, the Group as the lessee recognizes right-of-use assets and lease liabilities for leases, but excludes the short-term leases and leases of low-value assets to which the Group applies a simplified approach.
Right-of-use assets are measured at cost initially. Lease liabilities are initially measured at the present value of the lease payments unpaid at the commencement date of a lease. In calculating the present value of lease payments, the Group uses the interest rate implicit in the lease as the discounting rate, or uses the incremental borrowing rate if the interest rate implicit in the lease is not readily determinable.
27.1.2 Subsequent measurement
After the lease commencement date, the Group as the lessee, adopts the cost model to make subsequent measurement of the right-of-use assets, and makes depreciations for the right-of-use assets referencing to relevant provisions of depreciation from Accounting Standard for Business Enterprises No.4– Fixed Assets. If the lessor can reasonably determine that the ownership of the leased assets is obtained before the expiration of the lease term, the depreciation shall be made during the remaining useful life of the leased assets. If it cannot be reasonably determined that the ownership of the leased assets can be obtained before the expiration of the lease term, the depreciation shall be made during the shorter term between the lease term and the remaining useful life of the leased assets.
The Group as the lessor shall calculate the interest expenses for lease liabilities of each period within the lease term based on the fixed periodic rate and record them to the profit or loss for the period. In accordance with Accounting Standard for Business Enterprises No.17– Borrowing costs and other standards, if it is specified that the expenses shall be recorded to the costs of relevant assets, provisions shall prevail. Variable lease payments not included in the measurement of lease liabilities shall be recorded to profit or loss for the period upon incurring. In accordance with Accounting Standard for Business Enterprises No.1– Inventories and other standards, if it is specified that the payments shall be recorded to the costs of relevant assets, provisions shall prevail.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
27. Leases - continued
27.1 The accounting treatment of the Group as lessee - continued
27.1.3 Short-term leases and leases of low-value assets
Short-term lease refers to leases with a lease term of not exceeding 12 months at the commencement date. Leases with a purchase option do not belong to the short-term leases. A lease of low value asset refers to a single lease asset, when new, is of low value. If the lessee subleases or expects to sublease the leased assets, the original lease does not belong to the lease of low value asset.
For short-term leases and leases of low-value assets, the lessor can choose not to recognize right- of-use assets and lease liabilities. For short-term leases, the Group as the lessor shall make the choice about accounting treatment based on the category of the leased assets. For leases of low- value assets, the Group as the lessor can make the choice about accounting treatment according to the specific situations of each lease.
27.2 The Group as lessor under operating leases
Lease receipts from operating leases are recognized as rental income on a straight-line basis over the term of the relevant lease by the Group as lessee, unless other systematic and reasonable methods can better reflect the consumption pattern under which the economic benefits are resulted by the use of the leased assets. Initial direct costs in connection with the operating lease of the lessee are capitalized when incurred, and are amortized on the same basis as rental income recognition over the lease term and recognized in profit or loss by stages.
For fixed assets under the operating lease, the Group as the lessee shall adopt the depreciation policy of similar assets; for other assets under operating lease, the Group adopts a systematic and reasonable approach on the amortization in accordance with applicable accounting standards for business enterprise to the assets. The variable lease payments the Group as the lessee obtains, which are not recorded to the lease receipts but relevant to operating leases shall be recorded to profit or loss for the period upon incurring.
28. Discontinued operation
Discontinued operation refers to the separately identifiable components that have been disposed of or classified as held for sale and meet one of the following conditions:
(1) The component represents an independent main business or a major business area; (2) This component is a part of a related plan that intends to dispose an independent main business or a separate main operating area;
(3) This component is a subsidiary acquired exclusively for resale.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
29. Safety Production Cost
According to the Administrative Rules on Provision and Use of Enterprise Safety Production Cost jointly issued by the Ministry of Finance and the State Administration of Work Safety on 14 February 2012 (filed as Cai Qi[2012] No. 16), safety production cost set aside by the Group is directly included in the cost of relevant products or recognized in profit or loss for the period, as well as the special reserve. When safety production cost set aside is utilized, if the costs incurred can be categorized as expenditure, the costs incurred should be charged against the special reserve. If the costs set aside are used to build up fixed assets, the costs should be charged to construction in progress, and reclassified to fixed assets when the safety projects are ready for intended use. Meantime, expenditures in building up fixed assets are directly charged against the special reserve with the accumulated depreciation recognized at the same amount. Depreciation will not be made in the future period on such fixed assets.
30. Critical judgments in applying accounting policies and key assumptions and uncertainties in accounting estimates
In the application of accounting policies as set out in Note (III), the Company is required to make judgments, estimates and assumptions about the carrying amounts of items in the financial statements that cannot be measured accurately, due to the internal uncertainty of the operating activities. These judgments, estimates and assumptions are based on historical experiences of the Company's management as well as other factors that are considered to be relevant. Actual results may differ from these estimates.
The Company regularly reviews the judgments, estimates and assumptions on a going concern basis. Changes in accounting estimates which only affect the current period should be recognized in current period; changes which not only affect the current but the future periods should be recognized in current and future periods. At the balance sheet date, key assumptions and uncertainties that are likely to lead to significant adjustments to the book values of assets and liabilities in the future are:
Goodwill impairment
For the purpose of impairment testing, the present value of the expected future cash flows of the assets group or portfolio including goodwill shall be calculated, and such expected future cash flows shall be estimated. Meantime, a pre-tax rate shall be determined that should reflect the time value of money on the current market and the specific interest risks.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
30. Critical judgments in applying accounting policies and key assumptions and uncertainties in accounting estimates - continued
Recognition of deferred tax
The Group calculates and makes provision for deferred income tax liabilities according to the profit distribution plan of subsidiaries, associates and the joint ventures subject to the related law. For retained earnings which are not allocated by the investment company, since the profits will be used to invest the company's daily operation and future development, no deferred income tax liabilities are recognized. If the actually distributed profits in the future are more or less than those expected, corresponding deferred tax liabilities will be recognized or reversed at the earlier of profits distribution date and the declaration date, in the profit and loss of the current period. Deferred tax assets are recognized based on the deductible temporary difference and the corresponding tax rate, to the extent that it has become probable that future taxable profit will be available for the deductible temporary difference. If in the future the actual taxable income does not coincide with the amount currently expected, the deferred tax assets resulting will be recognized or reversed in the period when actually incurred, in profit or loss.
31. Changes in significant accounting policies and accounting estimates
(1) New Standard on Lease
New standard on lease removed the category of the lessor on financing lease and operating lease, required the lessor to recognize right-of-use assets and lease liabilities for all the leases (excluding short-term leases and leases of low value that adopt a simplified approach) and recognized depreciation and interest expenses respectively. In terms of the lessee, new standard on lease basically adopted the previous accounting treatments of leases. When implementing new standard on lease, the Group adjusted the opening balance of retained earnings of the same year when new standard on lease was initially implemented and the amounts of other relevant items of the financial statements, with information of the comparative period not adjusted. For operating lease prior to the initial implementation date, the Group as the lessor measures lease liabilities at the present value discounted at the incremental borrowing rate of the lessor on the initial implementation date based on the remaining lease payments and assumes that since the commencement date of the lease term, right-of-use assets are measured at the book value as specified in the new standard on lease (the incremental borrowing rate of the lessor on the initial implementation date is adopted as the discount rate). Details of the Group's accounting policies on the recognition and measurement of lease are set out in the Note (III) 27 "Lease".
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
31. Changes in significant accounting policies and accounting estimates - continued (1) New Standard on Lease - continued
The effects from the implementation of new standard on lease on relevant items of the consolidated balance sheet as at 1 January 2019 are presented as follows:
RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
|Item||31 December 2018||Reclassification||Remeasurement||1 January 2019|
|Assets:|||||||||
|Prepayments|124,404,862.87||-42,559,680.57||-||81,845,182.30||
|Fixed assets|22,994,190,880.43||-5,516,393,451.13||-||17,477,797,429.30||
|Right-of-use assets|||5,558,953,131.70||990,610,899.85||6,549,564,031.55||
|Liabilities:|||||||||
|Non-current|2,903,320,877.97||-||124,039,367.88||3,027,360,245.85||
|liabilities due within|||||||||
|one year|||||||||
|Lease liabilities|||41,329,917.95||978,909,906.78||1,020,239,824.73||
|Long-term payables|1,294,190,118.18||-41,329,917.95||-||1,252,860,200.23||
|Unappropriated|8,915,817,110.21||-||-37,858,457.43||8,877,958,652.78||
|profits|||||||||
|Minority interests|49,656,450,459.88||-||-74,479,917.38||49,581,970,542.50||

 The reconciliation of operating lease commitments as at 31 December 2018 and lease
liabilities as at 1 January 2019 is as follows:
RMB
||||
|-|-|-|
|Item||Amount|
|Total minimum lease payments of irrevocable operating lease as at 31 December 2018|1,756,853,448.93||
|Less: The effect of present value from the calculation of lease payments by the lessee at|869,755,725.26||
|the incremental interest rate in the lease on 1 January 2019|||
|Lease liabilities as at 31 December 2018|887,097,723.67||
|Less: Short-term leases, leases of low-value assets and leases to be completed within 12|13,130,042.63||
|months after the initial implementation date|||
|Add: Lease modification through increase or termination|270,311,511.57||
|Amount discounted on initial implementation date (Note)|1,144,279,192.61||
|Lease liabilities|1,144,279,192.61||
|Including: Non-current liabilities due within one year|124,039,367.88||
|Lease liabilities|1,020,239,824.73||

 Note: The Group's weighted average percentage of the incremental borrowing rate adopted for lease liabilities recorded to the balance sheet on the initial implementation date is5.16%. Changes of the above accounting policies have been approved in the Fifth Meeting by the Company's Ninth Session of Board of Directors.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
III. THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES - continued
31. Changes in significant accounting policies and accounting estimates - continued (2) Presentation of financial statements
The Company started adopting the Notice of the Revised Format of 2019 Financial Statements for General Business Enterprise (Cai Kuai (2019) No.6 , hereinafter referred to as the "Cai Kuai No.6 Document") released by the MoF on 30 April 2019 since the preparation of interim financial statements for the year of 2019. Cai Kuai No.6 Document revised the presenting accounts in the balance sheet and income statement, added line items of "Notes Receivable", Accounts Receivable", "Receivable Financing", "Right-of-Use Assets", "Notes Payable", "Accounts Payable" and "Lease Liabilities", removed the line items of "Notes and Accounts Receivable" and "Notes and Accounts Payable", revised the presenting contents of the line items of "Other Receivables" and "Other Payables", i.e., interest receivables and interest payables only reflect the interest receivable or payable of relevant financial instruments that have expired but not yet received or paid. Interests of the financial instruments accrued based on the effective interest method shall be included in the carrying amount of corresponding financial instruments. In the meantime, the Cai Kuai No.6 Document also revised the presentation contents of the item of "interest income" and line item of "other income" under the items of "research and development expenses", "management expenses", "financial expenses", increased line item of "including: income from derecognition of financial assets measured at amortized costs" under the item of "investment income", and adjusted the presenting location of some accounts in the income statement. The Group has accounted for the above changes in presenting accounts retrospectively, and adjusted comparable data for the prior year.
IV. TAXES
1. Major taxes and tax rates
||||
|-|-|-|
|Taxes|Tax basis|Tax rate|
||Taxable income|16.5%-34% (Note 1)|
|Enterprise income tax|||
||Dividend income tax|5%、10%、25% (Note 2)|
||Income from sale of goods (Note 4)|9%-17%|
||Income from transportation, loading and unloading business andpart of modern service industries|6%|
|Value-added Tax|||
|("VAT") (Note 3)|||
||Income from sale of real estate, property management, real estatelease, etc.|5%|
|Social contribution|Income|0.65%-7.6%|
|tax (Note 5)|||
|Deed tax|Land use right and property transfer amount|3%-5%|
|Property tax|70% of cost of property or rental income|1.2% or 12%|
|City maintenance and|VAT paid|1%-7%|
|construction tax|||
|Education surtax|VAT paid|3%|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
IV. TAXES - continued
1. Major taxes and tax rates - continued
Note 1:The Group's enterprise income tax is calculated based on the current tax rate stipulated by local tax laws. Among them, the Company are subject to an enterprise income tax rate of25%, the subsidiaries set up in Hong Kong are subject to an enterprise income tax rate of16.5%, the subsidiaries set up in China are subject to an enterprise income tax rate of25%, and the other overseas subsidiaries are subject to enterprise income tax rates between28% and34%.
Note 2: Foreign investors who receive dividends of profits from Chinese subsidiaries in 2008 and thereafter generally shall pay withholding income tax at a rate of10% in accordance with the relevant provisions of the PRC enterprise income tax. For companies incorporated in certain regions (including Hong Kong and Singapore), if the companies are actual owners holding more than25% interest in the subsidiaries in China, they will enjoy a preferential tax rate of5%.
The Company obtains dividends distributed by overseas subsidiaries and should pay enterprise income tax at a rate of25% in accordance with relevant Chinese tax laws. The Company obtains taxable income outside of China, and the amount of income tax that has been paid abroad can be offset with the current taxable amount. The credit limit is the taxable amount calculated in accordance with the provisions of the Enterprise Income Tax Law.
Note 3: The VAT amount is the balance of the output tax less the deductible input tax, and the output tax is calculated in accordance with the sales income and the corresponding tax rate stipulated in the relevant tax laws of China.
Note 4: Pursuant to the Notice of the Ministry of Finance, the State Administration of Taxation and the General Administration of Customs on Relevant Policies for Deepening the Value- added Tax Reform (Announcement of the Ministry of Finance, the State Taxation Administration and the General Administration of Customs No.39 in 2019), effective from 1 April 2019, the taxable sales or imports of goods at original applicable VAT rate of16% and10% shall be subject to a VAT rate of13% and9% respectively.
Note 5: The social contribution tax is the tax paid by the overseas subsidiaries of the Group to the local government.
2. Tax preference
Some subsidiaries of the Group in China are subject to tax preference of "3-year exemption followed by 3-year half reduction".
Some subsidiaries of the Group in China are recognized as high-tech enterprises or encouraged industrial enterprises in the region and are subject to an enterprise income tax rate of15%. The Group's subsidiaries outside China may be subject to enterprise income tax preference in accordance with relevant local tax policies.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS
1. Cash and bank balances
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Cash|462,266.71|349,650.07|
|RMB|182,545.85|77,877.30|
|USD|68,457.58|29,909.14|
|HKD|58,215.28|57,342.60|
|BRL|8,710.11|11,402.34|
|Others|144,337.89|173,118.69|
|Bank deposit (Note1)|6,170,682,223.14|6,118,508,644.13|
|RMB|3,934,330,091.87|3,401,709,911.75|
|USD|1,307,149,748.49|1,326,034,833.97|
|EUR|432,023,862.80|359,682,134.06|
|BRL|269,889,725.25|539,493,644.44|
|HKD|192,474,745.23|432,603,546.37|
|Others|34,814,049.50|58,984,573.54|
|Other cash and bank balances (Note 2)|865,746,359.34|951,450,410.55|
|RMB|865,746,359.34|951,450,410.55|
|Interest receivable of fixed deposit|18,579,946.79|7,088,190.97|
|Total|7,055,470,795.98|7,077,396,895.72|
|Including: Total amount of funds deposited overseas|2,509,024,453.85|2,809,011,079.47|

 Note 1: The bank deposits of the Group deposited overseas and restricted for remittance to China at the end of the period totaled RMB 1,003,706,200.00.
Note 2: The structured deposits that cannot be readily withdrawn on demand in the other cash and bank balances of the Group totaled RMB 415,000,000.00, the structured deposits that can be readily withdrawn on demand totaled RMB 432,119,238.44, the deposit totaled RMB 17,752,768.76, and the balance of the margin maintenance account was RMB 874,352.14. 2. Notes receivable
(1) Classification of notes receivable
RMB
||||||
|-|-|-|-|-|
|Category||Closing balance||Opening balance|
|Bank acceptance|187,215,998.98||11,608,669.43||
|Commercial acceptance|43,357,403.78||-||
|Less: Provision for credit losses|-||-||
|Carrying amount|230,573,402.76||11,608,669.43||

 (2) As at 30 June 2019, there are no notes receivable pledged.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 2. Notes receivable - continued
(3) As at 30 June 2019, there are no notes receivable endorsed or discounted which are not yet due at the balance sheet date.
RMB
||||||
|-|-|-|-|-|
|||Closing balance for|||
|||||Closing balance for|
|Category||discontinued|||
|||||continued recognition|
|||recognition|||
|Bank acceptance|150,795,657.53||-||
|Commercial acceptance|1,452,031.29||-||
|Total|152,247,688.82||-||

 (4) As at 30 June 2019, there are no notes reclassified to accounts receivable due to the drawers' inability to settle the note.
3. Accounts receivable
(1) Disclosure of accounts receivable by categories
RMB
||||||||
|-|-|-|-|-|-|-|
||Expected credit||Closing balance||||
|Credit rating|||||||
||loss rate (%)||Carrying amount||Provision|Book value|
|A|0.00-0.10|747,447,560.16||-||747,447,560.16|
|B|0.10-0.30|512,113,432.30||349,686.40||511,763,745.90|
|C|0.30-50.00|500,097,483.79||2,759,736.89||497,337,746.90|
|D|50.00-100.00|112,089,097.88||42,231,068.21||69,858,029.67|
|Total||1,871,747,574.13||45,340,491.50||1,826,407,082.63|

 (2) Changes in provision for credit loss of accounts receivable
RMB
|||||||
|-|-|-|-|-|-|
||||In the current period|||
||Item|L|ifetime expected credit loss|Lifetime expected credit loss||
||||||Total|
||||(not credit-impaired)|(credit-impaired)||
||At 31 December 2018|3,255,846.32||40,262,199.28|43,518,045.60|
|Pt|rovision for expected credit loss for|1,294,747.94||624,104.33|1,918,852.27|
||he period|||||
|Rt|eversal of expected credit loss for|6,200,021.67||899,922.47|7,099,944.14|
||he period|||||
|Ec|ffect of changes in the scope of|4,742,830.09||2,237,014.01|6,979,844.10|
||onsolidation|||||
|Ee|ffect of changes in foreign|16,020.61||7,673.06|23,693.67|
||xchange|||||
||At 30 June 2019|3,109,423.29||42,231,068.21|45,340,491.50|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 3. Accounts receivable - continued
(3) The top five balances of accounts receivable classified by debtor
RMB
|||||
|-|-|-|-|
||||Proportion of the|
|Name of|||amount to the total|
||Carrying amount|Aging||
|customer|||accounts receivable|
||||(%)|
||91,443,882.97|Within 1 year, more than 1 year but not exceeding 2years, more than 2 years but not exceeding 3 yearsand more than 3 years|4.89|
|Client A||||
|Client B|77,945,778.60|Within 1 year|4.16|
||75,995,889.95|Within 1 year, more than 1 year but not exceeding 2years, more than 2 years but not exceeding 3 years|4.06|
|Client C||||
|Client D|75,021,296.44|Within 1 year|4.01|
|Client E|37,744,879.20|Within 1 year|2.02|
|Total|358,151,727.16||19.14|

 4. Prepayments
(1) Aging analysis of prepayment
RMB
||||||
|-|-|-|-|-|
||Closing balance||Opening balance||
|Aging||Proportion||Proportion|
||Amount||Amount||
|||(%)||(%)|
|Within 1 year|109,677,519.35|99.03|124,276,781.51|99.90|
|More than 1 year but not exceeding 2 years|918,646.55|0.83|4,000.00|-|
|More than 2 years but not exceeding 3 years|81.36|-|81.36|-|
|More than 3 years|159,000.00|0.14|124,000.00|0.10|
|Total|110,755,247.26|100.00|124,404,862.87|100.00|

 (2) The Group has no significant prepayments aged more than one year.
(3) The top five balances of prepayments classified by entities
RMB
|||||
|-|-|-|-|
||||Proportion of the closing|
||Relationship with the|||
|Entities||Closing balance|balance to the total|
||Company|||
||||prepayments (%)|
|Changsha Road & Bridge Construction|Non-related party|9,867,294.37|8.91|
|Corporation Lanka Limited||||
|Judicial Insurance|Non-related party|7,937,387.24|7.17|
|Operational Insurance|Non-related party|7,587,231.24|6.85|
|Saham Assurance Togo S.A.|Non-related party|6,498,310.32|5.87|
|CCCC Fourth Harbor Engineering Co., Ltd.|Non-related party|5,000,000.00|4.51|
|Total||36,890,223.17|33.31|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 5. Other receivables
(1) Summary of other receivables
RMB
||||||
|-|-|-|-|-|
|Item||Closing balance||Opening balance|
|Interest receivable|-||-||
|Dividend receivable|1,414,765,846.24||259,804,145.16||
|Other receivables|6,645,273,886.55||506,713,933.56||
|Total|8,060,039,732.79||766,518,078.72||

 (2) Interest receivable
As at 30 June 2019, the Group has no significant overdue interest.
(3) Dividend receivable
(a) Presentation of dividend receivable
RMB
||||||
|-|-|-|-|-|
|Name of investee||Closing balance||Opening balance|
|Shanghai International Port (Group) Co., Ltd.|910,321,459.36||50,118,027.14||
|China Nanshan Development (Group) Incorporation|316,246,500.00||175,692,500.00||
|("Nanshan Group")|||||
|Tin-Can Inland Container Terminal Ltd|66,876,446.00||-||
|Qingdao Port International Co., Ltd.|56,728,800.59||-||
|Dalian Port (PDA) Company Limited|46,490,179.50||-||
|Qingdao Qianwan United Container Terminal Co., Ltd.|-||25,000,000.00||
|Zhanjiang Port (Group) Co., Ltd.|-||9,253,682.23||
|Others|18,278,153.29||-||
|Total|1,414,941,538.74||260,064,209.37||
|Less: Provision for credit loss|175,692.50||260,064.21||
|Book value|1,414,765,846.24||259,804,145.16||

 (b) Significant dividend receivable aged more than 1 year
RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
|Name of investee||Closing balance||Aging||Why unrecovered||Impaired or not|
||70,277,000.00||More than 1 yearbut not exceeding 2years||Undergoing relevantformalities andexpected to berecovered at the endof 2019||Not||
|Nanshan Group|||||||||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 5. Other receivables - continued
(4) Other receivables
(a) Disclosure of other receivables by categories
As part of the Group's credit risk management, the Group conducts internal credit ratings for its customers and determines the expected loss rate for other receivables for each rating. Such expected average loss rates are based on actual historical impairments and taking into account the current and future economic conditions.
As at 30 June 2019, the credit risk and expected credit loss of other receivables of each category of customers are presented as below:
RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|||||Closing balance|||||||
|||Expected|||||||||
|||||Expected||Lifetime expected||Lifetime expected|||
|Credit rating||credit loss|||||||||
|||||credit loss||credit loss||credit loss||Total|
|||rate (%)|||||||||
|||||in 12 months||(not credit-impaired)||(credit-impaired)|||
|A|0.00-0.10||6,049,438,145.00||-||-||6,049,438,145.00||
|B|0.10-0.30||596,070,980.16||-||-||596,070,980.16||
|C|0.30-50.00||-||-||-||-||
|D|50.00-100.00||-||-||35,685,343.90||35,685,343.90||
|Carrying amount|||6,645,509,125.16||-||35,685,343.90||6,681,194,469.06||
|Provision for|||235,238.61||-||35,685,343.90||35,920,582.51||
|credit loss|||||||||||
|Book value|||6,645,273,886.55||-||-||6,645,273,886.55||

 (b) Changes in provision for credit loss of other receivables
RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
||||In the current period||||||
|||||Lifetime expectedcredit loss(not credit-impaired)||Lifetime expected|||
||Item||Expected credit loss||||||
|||||||credit loss||Total|
||||in 12 months||||||
|||||||(credit-impaired)|||
||At 31 December 2018|5,690.10||-|35,596,931.73||35,602,621.83||
|Pl|rovision for expected credit|126,603.15||-|-||126,603.15||
||oss for the year||||||||
|f|Reversal of expected credit loss|2,533,596.66||-|-||2,533,596.66||
||or the year||||||||
|o|Effect of changes in the scope|2,636,542.02||-|91,822.29||2,728,364.31||
||f consolidation||||||||
|e|Effect of changes in foreign|-||-|-3,410.12||-3,410.12||
||xchange||||||||
||At 30 June 2019|235,238.61||-|35,685,343.90||35,920,582.51||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 5. Other receivables - continued
(4) Other receivables - continued
(c) Other receivables presented by the nature
RMB
||||||
|-|-|-|-|-|
|Items||Closing balance||Opening balance|
|Land compensation(Note 1)|6,049,438,145.00||-||
|Operation compensation(Note 2)|175,946,294.80||176,625,857.32||
|Temporary payments|157,688,061.24||187,153,302.95||
|Deposits|38,275,052.02||39,657,003.56||
|Others|259,846,916.00||138,880,391.56||
|Total|6,681,194,469.06||542,316,555.39||
|Less: Provision for credit loss|35,920,582.51||35,602,621.83||
|Book value|6,645,273,886.55||506,713,933.56||

 Note 1: It is the land compensation recognized in accordance with the Agreement of Acknowledgement on Claim Compensations signed jointly by the Group's subsidiary with China Merchants Qianhai Chidi Industrial (Shenzhen) Co., Ltd. and other original land holding companies for Qianhai land readiness on 11 January 2019.
Note 2: It is the compensation paid by the holding company of the non-controlling shareholder of the non-wholly owned subsidiary of the Group for the operation of the subsidiary. (d) There are no other receivables that have been written off in the period from 1 January to 30 June 2019.
(e) The top five balances of other receivable classified by debtor
RMB
|||||||
|-|-|-|-|-|-|
|||||Proportion of the||
||||||Bad debt|
|Name of customer|Nature|Closing balance|Aging|amount to the other||
||||||provision|
|||||receivable (%)||
|China Merchants Qianhai Chidi Industrial|Landcompensation|5,240,907,829.70|Within 1 year|78.44|-|
|(Shenzhen) Co., Ltd.||||||
|Shenzhen Qianhai Shekou Qidi Industrial|Landcompensation|708,835,049.08|Within 1 year|10.61|-|
|Co., Ltd.||||||
||Operationcompensation|175,318,159.50|More than 2 yearsbut not exceeding 3years|2.62|-|
|Global Terminal Limited||||||
|Shenzhen Qianhai Shekou Qiming|Landcompensation|99,695,266.22|Within 1 year|1.49|-|
|Industrial Co., Ltd.||||||
|Zhujiang Inland Water Freight Terminals|Temporarypayments|60,215,465.00|More than 3 years|0.90|-|
|Co., Ltd.||||||
|Total||6,284,971,769.50||94.06|-|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 6. Inventories
(1) Categories of inventories
RMB
||||||||
|-|-|-|-|-|-|-|
||Closing balance|||Opening balance|||
|||Provision for|||Provision for||
|Item|||||||
||Carrying amount|decline in value|Book value|Carrying amount|decline in value|Book value|
|||of inventories|||of inventories||
|Raw materials|158,218,919.16|2,209,412.85|156,009,506.31|89,572,663.06|2,584,953.53|86,987,709.53|
|Finished goods|5,911,804.77|-|5,911,804.77|4,629,610.81|-|4,629,610.81|
|Others|15,769,772.63|-|15,769,772.63|16,949,949.68|-|16,949,949.68|
|Total|179,900,496.56|2,209,412.85|177,691,083.71|111,152,223.55|2,584,953.53|108,567,270.02|

 (2) Provision for decline in value of inventories
RMB
|||||||
|-|-|-|-|-|-|
||||DecreaseReversal Write-off||Closing|
|Item|Opening balance|Provision||||
|||||Write-off|balance|
|Raw materials|2,584,953.53|-|25,051.16|350,489.52|2,209,412.85|

 (3) As at 30 June 2019, the Group has no capitalized borrowing cost in the balance of inventories.
7. Assets held for sale
RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
|||Carrying amount||||Estimated|||
|||||Fair value at the end|||||
|Item||at the end of the||||disposal||Schedule|
|||||of the period|||||
|||period||||expenses|||
||115,356,162.94||204,909,850.97||-||Return and demolitionbefore 31 December2019||
|Long-term assets held for sale|||||||||
|Less: Provision for impairment of|-||-||-||||
|assets held for sale|||||||||
|Carrying amount|115,356,162.94||-||-||||

Note: It is the land with an area about 133.61 mu and the attached buildings on the east side of Zhuchi Deepwater Port on the south side of Zhongshan East Road in Shantou City held by the Company's subsidiary Shantou CMPort Group Co., Ltd. (hereinafter referred to as "Shantou CMPort"). On 31 December 2018, Shantou Land Reserve Center signed a land acquisition agreement with Shantou CMPort, which stipulated that Shantou CMPort should transfer the above-mentioned land and attached buildings to Shantou Land Reserve Center at RMB 204,909,850.97. As it had disputes with five companies such as Jieyang Guangtaifa Industrial Co., Ltd., Shantou Highway Bureau Mechanical Material Supply Depot, Shantou Niannianfeng Grain Storage Co., Ltd., Shantou Chengji Logistics Co., Ltd. and Shantou Junfengyan Trading Co., Ltd. on the land return, it is now under settlement through legal approaches, which is expected to be completed by the end of the year.
8. Other current assets due within 1 year
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Long-term receivables due within 1 year|781,746,908.19|-|
|Interest receivable of Long-term receivables|85,591,561.08|25,952,956.76|
|Total|867,338,469.27|25,952,956.76|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 9. Other current assets
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Prepaid taxes|8,061,051.00|7,872,157.38|
|Loans to the associates of related parties|-|1,029,478,047.00|
|Others (Note 1)|243,621,047.85|159,100,462.79|
|Total|251,682,098.85|1,196,450,667.17|
|Less: Provisions for credit loss|-|1,029,478.05|
|Book value|251,682,098.85|1,195,421,189.12|

 Note 1: It mainly consists of closing balances of allowances for value-added tax of domestic subsidiaries.
10. Long-term receivables
(1) Long-term receivables
RMB
||||||||
|-|-|-|-|-|-|-|
||Closing balance|||Opening balance|||
|Item||Provision for credit|||Provision for credit||
||Carrying amount||Book value|Carrying amount||Book value|
|||loss|||loss||
|Advances to|1,723,901,156.32|1,723,901.16|1,722,177,255.16|793,840,080.19|793,840.08|793,046,240.11|
|shareholders|||||||
|Less: Long-term|782,529,437.63|782,529.44|781,746,908.19|-|-|-|
|receivables due|||||||
|within one year|||||||
|Long-term|941,371,718.69|941,371.72|940,430,346.97|793,840,080.19|793,840.08|793,046,240.11|
|receivables due|||||||
|after one year|||||||

(2) There are no long-term receivables derecognized due to the transfer of financial assets at the end of the period.
(3) There are no assets and liabilities arising from the transfer and further involvement of long- term receivables at the end of the period.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
11. Long-term equity investments
RMB
||||||||||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|||Accounting||Effect ofchanges in the|Changes of this periodProvi Effect of translatioReconcilingInvestment profit Cash dividends or sion of financial|||||||||||||n||Closing balance|
|Investees||method|1 January 2019|scope ofconsolidation|Increase|or loss underequity method||items from othecomprehensiveincome|r|Other equitymovements|profits announced ofissuance|other||forimparmen|it||statementsdenominated inforeign currencies||30 June 2019|of provision forimpairment|
|I.|Joint ventures||||||||||||||||||||
|E|uro-Asia Oceangate S.à r.l.|Equity method|2,668,860,034.32|-|-|43,143,162.57|-|||-|-|-|-|||5,041,702.02|||2,717,044,898.91|-|
|P|ort of Newcastle|Equity method|2,122,353,964.75|-|-|13,262,597.02|-|||-|-28,604,885.04|-|-|||-4,519,316.23|||2,102,492,360.50|-|
|Z|hanjiang Port(Group) Co., Ltd.(Note 1)|Equity method|2,007,506,536.77|-|-|4,273,885.37|-|||-|-|-2,011,780,422.14|-|||-|||-|-|
|Q|ingdao Qianwan United Container Terminal|Equity method|1,512,162,331.41|-|-|69,739,231.62|-|||1,200,648.15|-|-|-|||-|||1,583,102,211.18|-|
||Co., Ltd.||||||||||||||||||||
|L|aizhou Laiyin Port Business Co., Ltd.|Equity method|793,557,064.58|-|-|21,889,138.83|-|||-|-43,605,689.02|-|-|||-|||771,840,514.39|-|
|O|thers|Equity method|2,125,862,222.43|113,562,995.78|-|102,041,452.04|-|||1,962,963.61|-3,118,014.31|-|-|||-4,271,366.06|||2,336,040,253.49|-|
|S|ubtotal||11,230,302,154.26|113,562,995.78|-|254,349,467.45|-|||3,163,611.76|-75,328,588.37|-2,011,780,422.14|-|||-3,748,980.27|||9,510,520,238.47|-|
|II|. Associates||||||||||||||||||||
|S|hanghai International Port (Group) Co., Ltd.|Equity method|22,187,560,070.95|-|-|1,164,668,288.63|23,495,401.05|||326,138,582.34|-955,194,576.56|-|-|||-231,106.00|||22,746,436,660.41|-|
||(A Share)||||||||||||||||||||
|N|anshan Group|Equity method|5,061,280,021.90|-|-|98,769,988.95|-10,073,152.90|||-1,382,508.59|-148,056,000.00|-|-|||-|||5,000,538,349.36|-|
|T|erminal Link SAS|Equity method|3,933,259,485.26|-|-|152,192,824.94|6,523,821.50|||-|-|-|-|||-12,216,935.48|||4,079,759,196.22|-|
|D|alian Port Co., Ltd.(A Share and H Share)|Equity method|3,203,881,342.67|-|-|59,283,560.53|6,114,817.60|||964,865.49|-51,579,984.00|-|-|||30,405,944.44|||3,249,070,546.73|617,607,222.70|
|C|hina Merchants Hainan Development|Equity method|525,000,000.00|-|-|-|-|||-|-|-|-|||-|||525,000,000.00|-|
||Investment Co., Ltd.||||||||||||||||||||
|O|thers|Equity method|4,035,294,188.36|59,122,780.74|10,800,000.00|66,688,847.58|-53,574,839.90|||4,067,411.68|-142,096,449.81|-|-|||9,637,616.82|||3,989,939,555.47|-|
|S|ubtotal||38,946,275,109.14|59,122,780.74|10,800,000.00|1,541,603,510.63|-27,513,952.65|||329,788,350.92|-1,296,927,010.37|-|-|||27,595,519.78|||39,590,744,308.19|617,607,222.70|
|T|otal||50,176,577,263.40|172,685,776.52|10,800,000.00|1,795,952,978.08|-27,513,952.65|||332,951,962.68|-1,372,255,598.74|-2,011,780,422.14|-|||23,846,539.51|||49,101,264,546.66|617,607,222.70|

 Note 1: Details are set out in the Note VI 1.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 12. Other investments in equity instruments
RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
|||||||Reasons for the||Cash dividends|
|Investees||Closing balance||Opening balance|||||
|||||||classification||for the period|
||141,547,500.00||141,547,500.00||The intention ofholding is neither forsale nor profits inshort-term||-||
|China Ocean Shipping Agency|||||||||
|(Shenzhen) Co., Ltd|||||||||
||406,100,337.55||88,806,577.97||The intention ofholding is neither forsale nor profits inshort-term||-||
|Lake Assal Investment Holding|||||||||
|Co., Ltd.|||||||||
||18,435,722.28||17,494,236.33||The intention ofholding is neither forsale nor profits inshort-term||120,000.00||
|Others|||||||||
|Total|566,083,559.83||247,848,314.30||||120,000.00||

 (1) Investment in equity instruments
RMB
||||||
|-|-|-|-|-|
|Item||Closing balance||Opening balance|
|Cost of equity instruments|425,567,013.40||108,289,950.79||
|Increase in the current year|311,642,892.00||3,892,322.00||
|Fair value|566,083,559.83||247,848,314.30||
|Changes of fair value included in OCI|140,516,546.43||139,558,363.51||

 13. Other non-current financial assets
RMB
|||||||
|-|-|-|-|-|-|
||Item||Closing balance||Opening balance|
||Financial assets at fair value through profit or loss for the|3,019,618,722.58||2,087,872,081.94||
||period|||||
|I|ncluding: Equity instrument investment|3,019,618,722.58||2,087,872,081.94||

 (1) Investment in equity instruments
RMB
||||||
|-|-|-|-|-|
|Item||Closing balance||Opening balance|
|Cost of equity instruments|1,235,178,600.58||1,173,690,773.13||
|Fair value|3,019,618,722.58||2,087,872,081.94||
|Changes of fair value included in profit or loss of the|1,784,440,122.00||914,181,308.81||
|current period|||||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 14. Investment properties
(1) Investment properties measured under cost method
RMB
|||||||||
|-|-|-|-|-|-|-|-|
||Item||Land use rights||Buildings||Total|
|I|. Total original carrying amount|||||||
||1.Opening balance|28,632,130.84||6,292,605,806.72||6,321,237,937.56||
||2.Increase in the current period|77,095,361.98||4,558,825.10||81,654,187.08||
||(1) Changes in the scope of consolidation|77,095,361.98||-||77,095,361.98||
||(2) Other increase|-||4,558,825.10||4,558,825.10||
||3.Decrease in the current period|-||-||-||
||4.Closing balance|105,727,492.82||6,297,164,631.82||6,402,892,124.64||
||II. Total accumulated depreciation|||||||
||1.Opening balance|15,495,791.85||415,595,156.20||431,090,948.05||
||2.Increase in the current period|14,615,668.53||96,731,355.62||111,347,024.15||
||(1) Provisions in the current period|993,666.79||94,131,252.31||95,124,919.10||
||(2) Changes in the scope of consolidation|13,622,001.74||-||13,622,001.74||
||(3) Other increase|-||2,600,103.31||2,600,103.31||
||3.Decrease in the current period|-||-||-||
||4.Closing balance|30,111,460.38||512,326,511.82||542,437,972.20||
||III. Total accumulated amount of provision for|||||||
||impairment losses of investment property|||||||
||1.Opening balance|-||-||-||
||2.Increase in the current period|-||-||-||
||3.Decrease in the current period|-||-||-||
||4.Closing balance|-||-||-||
||IV. Total book value of investment property|||||||
||1.Closing balance|75,616,032.44||5,784,838,120.00||5,860,454,152.44||
||2.Opening balance|13,136,338.99||5,877,010,650.52||5,890,146,989.51||

 (2) Investment properties without ownership certificates
RMB
||||||
|-|-|-|-|-|
|Item||Closing balance||Opening balance|
|Buildings and land use rights|42,309,570.65||43,119,291.89||

 15. Fixed assets
RMB
||||||
|-|-|-|-|-|
|Item||Closing balance||Opening balance|
|Fixed assets|25,605,373,214.39||22,994,155,151.43||
|Disposal of fixed assets|70,382.97||35,729.00||
|Total|25,605,443,597.36||22,994,190,880.43||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 15. Fixed assets - continued
(1) Fixed assets
RMB
|||||||
|-|-|-|-|-|-|
||Port and terminal||Mechanical equipment,|Motor vehicles, cargo||
|Item||Buildings|||Total|
||facilities||furniture and others|ships and tugboats||
|I.Total original carrying||||||
|amount||||||
|1. Closing balance of the|21,835,237,866.98|1,148,966,435.46|10,592,156,358.16|1,368,265,652.07|34,944,626,312.67|
|preceding year||||||
|Add: Changes in accounting|-5,318,357,246.96|-133,330,273.37|-360,238,863.33|-38,350,000.00|-5,850,276,383.66|
|policies||||||
|Opening balance of the year|16,516,880,620.02|1,015,636,162.09|10,231,917,494.83|1,329,915,652.07|29,094,349,929.01|
|2. Increase in the current|7,331,519,887.52|1,327,716,163.74|3,475,622,130.66|590,257,228.39|12,725,115,410.31|
|period||||||
|(1)Purchase|12,905,118.56|2,367,071.75|51,214,190.50|6,184,756.09|72,671,136.90|
|(2)Transfer from construction|290,269,939.53|2,627,264.21|64,759,733.69|32,643,815.89|390,300,753.32|
|in progress||||||
|(3) Transfer from other non-|-|-|52,135,980.46|-|52,135,980.46|
|current assets||||||
|(4) Effect of changes in the|7,028,344,829.43|1,322,721,827.78|3,307,512,226.01|551,428,656.41|12,210,007,539.63|
|scope of consolidation||||||
|3. Decrease in the current|10,844,054.87|4,977,938.88|58,465,608.33|15,957,574.05|90,245,176.13|
|period||||||
|(1)Disposal or retire|10,844,054.87|1,001,667.78|58,465,608.33|15,957,574.05|86,268,905.03|
|(2) Transfer to investment|-|3,976,271.10|-|-|3,976,271.10|
|properties||||||
|4.Effect of changes in foreign|-9,951,427.96|628,694.76|12,728,247.87|1,499,819.48|4,905,334.15|
|exchange||||||
|5.Closing balance|23,827,605,024.71|2,339,003,081.71|13,661,802,265.03|1,905,715,125.89|41,734,125,497.34|
|II. Total accumulated||||||
|depreciation||||||
|1.Total original carrying|4,947,169,556.44|247,180,241.42|6,183,431,342.23|515,226,508.99|11,893,007,649.08|
|amount||||||
|Add: Changes in accounting|-85,260,010.27|-6,028,470.75|-214,493,738.80|-28,100,712.71|-333,882,932.53|
|policies||||||
|Opening balance of the year|4,861,909,546.17|241,151,770.67|5,968,937,603.43|487,125,796.28|11,559,124,716.55|
|2.Increase in the current|1,996,476,760.49|318,018,127.06|1,955,522,870.52|311,686,382.26|4,581,704,140.33|
|period||||||
|(1)Accrual of depreciation|362,239,326.33|38,699,382.67|372,048,133.58|44,484,521.78|817,471,364.36|
|(2)Effect of changes in the|1,634,237,434.16|279,318,744.39|1,583,474,736.94|267,201,860.48|3,764,232,775.97|
|scope of consolidation||||||
|3.Decrease in the current|6,118,563.22|3,285,273.24|53,844,417.63|13,798,024.90|77,046,278.99|
|period||||||
|(1)Disposal or retire|6,118,563.22|685,169.93|53,844,417.63|13,798,024.90|74,446,175.68|
|(2) Transfer to investment|-|2,600,103.31|-|-|2,600,103.31|
|properties||||||
|4.Effect of changes in foreign|-769,588.09|-81,082.82|7,575,704.43|579,802.99|7,304,836.51|
|exchange||||||
|5.Closing balance|6,851,498,155.35|555,803,541.67|7,878,191,760.75|785,593,956.63|16,071,087,414.40|
|III. Total accumulated||||||
|amount of provision for||||||
|impairment losses of||||||
|investment property||||||
|1.Opening balance|57,419,468.96|-|44,043.20|-|57,463,512.16|
|2.Increase in the current|-|-|201,356.39|-|201,356.39|
|period||||||
|(1) Effect of changes in the|-|-|201,356.39|-|201,356.39|
|scope of consolidation||||||
|3. Decrease in the current|-|-|-|-|-|
|period||||||
|4.Closing balance|57,419,468.96|-|245,399.59|-|57,664,868.55|
|IV. Total book value of||||||
|investment property||||||
|(1) Closing balance|16,918,687,400.40|1,783,199,540.04|5,783,365,104.69|1,120,121,169.26|25,605,373,214.39|
|(2) Opening balance|16,830,648,841.58|901,786,194.04|4,408,680,972.73|853,039,143.08|22,994,155,151.43|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 15. Fixed assets - continued
(2) Fixed assets leased out through operating leasing
(a) Category of fixed assets leased out through operating leasing
RMB
|||||
|-|-|-|-|
|Item||Closing balance|Opening balance|
|Buildings|-||242,804,849.53|
|Mechanical equipment, furniture and others|136,657.94||139,712.96|
|Port and terminal facilities|-||844,843,802.95|
|Total|136,657.94||1,087,788,365.44|

 (3) Fixed assets without ownership certificates
RMB
|||||
|-|-|-|-|
|Item||Closing balance|Opening balance|
|Buildings, Port and terminal facilities|1,931,881,247.69||1,590,990,468.38|

 (4) Other issues
RMB
|||||
|-|-|-|-|
|Item||Amount|Note|
|The original amounts of fixed assets fully depreciated|2,669,419,489.91|||
|but still in use at 30 June 2019||||
|Closing original amount of temporary idle fixed assets|-|||
|Fixed assets disposed or retired in the current period|-|||
|Original amount of fixed assets disposed or retired in the|86,268,905.03|||
|current period||||
|Net book value of fixed assets disposed or retired in the|11,822,729.35|||
|current period||||
|Gains or losses on disposal or retire of fixed assets|-2,328,266.93|||

16. Construction in progress
(1) Presentation by category
RMB
|||||
|-|-|-|-|
|Item||Closing balance|Opening balance|
|Construction in progress|7,237,793,710.46||5,499,426,090.06|
|Materials for construction in progress|17,638,826.10||-|
|Total|7,255,432,536.56||5,499,426,090.06|

 (2) Construction in progress
RMB
||||||||
|-|-|-|-|-|-|-|
||Closing balance|||Opening balance|||
|Item||Provisions for|||Provisions for||
||Carrying amount||Book value|Carrying amount||Book value|
|||impairment|||impairment||
|Port and terminal facilities|4,607,765,086.98|-|4,607,765,086.98|4,104,748,962.75|-|4,104,748,962.75|
|Berths and yards|1,218,456,474.47|-|1,218,456,474.47|1,023,331,798.30|-|1,023,331,798.30|
|Infrastructure|1,171,263,522.78|-|1,171,263,522.78|40,000,912.00|-|40,000,912.00|
|Ship under construction|77,509,483.40|-|77,509,483.40|22,985,373.73|-|22,985,373.73|
|Workshops and laboratories|403,524.03|-|403,524.03|-|-|-|
|Others|162,395,618.80|-|162,395,618.80|308,359,043.28|-|308,359,043.28|
|Total|7,237,793,710.46|-|7,237,793,710.46|5,499,426,090.06|-|5,499,426,090.06|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V. NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
16. Construction in progress - continued
(3) The top ten balances of construction in progress
RMB
|||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|||||||||Proportion of||||||
|||||||||||||Interest||
|||||||||accumulated|Construct||Including:|||
|||||Effect of changes||||||Amount of||capitalization||
||||Increase in the current||Decrease in the|Effect of changes in||construction|ion||capitalized||Capital|
|Item|Budget amount|Opening balance||in scope of|||Closing balance|||accumulated||rate for the||
||||period||current period|foreign exchange||investment in|progress||interest for the||source|
|||||consolidation||||||capitalized interest||current||
|||||||||budget|(%)||current period|||
|||||||||||||period (%)||
|||||||||(%)||||||
||2,875,500,000.00|1,250,245,755.45|222,810,526.79|-|7,155,172.40|-|1,465,901,109.84|50.98|50.98|13,447,553.66|-|-|Self-funding andloan|
|Guangao project Phase II, Shantou Port||||||||||||||
|Reconstruction Project of container, oil terminal|2,781,116,783.66|1,384,261,784.70|-|-|-|2,317,981.34|1,386,579,766.04|49.86|49.86|-|-|-|Self-funding|
|and tank area, HIPG||||||||||||||
||1,166,668,096.04|966,596,696.12|166,440,970.56|-|-|3,829,981.20|1,136,867,647.88|97.45|95.00|40,463,736.23|4,718,371.06|8.43|Self-funding andloan|
|TCP berth expansion project||||||||||||||
||1,000,000,000.00|737,758,848.51|25,967,296.59|-|18,032.79|-|763,708,112.31|76.37|76.37|64,689,677.87|7,932,544.98|4.84|Self-funding andloan|
|Berth 3 of Houshigang District, Xiamen Port||||||||||||||
||1,174,090,000.00|417,326,228.14|37,170,476.33|-|-|-|454,496,704.47|38.71|38.71|-|-|-|Self-funding andloan|
|Reconstruction project of Berth 1#-4#, Haixing||||||||||||||
|Wharf||||||||||||||
||1,298,948,400.00|-|18,975,028.92|339,956,626.94|-|-|358,931,655.86|27.63|27.63|3,970,703.65|3,970,703.65|4.79|Self-funding andloan|
|General Cargo Wharf Project of the East||||||||||||||
|Island Harbor of Zhanjiang Port||||||||||||||
|CICT Shorebridge and Gantry Crane Purchase|184,241,960.00|-|173,992,825.50|-|-|2,310,637.85|176,303,463.35|95.69|95.69|-|-|-|Self-funding|
|Project||||||||||||||
|First Phase Project of CFS Service Area of|607,190,000.00|-|5,524.00|124,474,810.57|-|-|124,480,334.57|20.50|20.50|-|-|-|Self-funding|
|Baoman Port Area of Zhanjiang Port||||||||||||||
||217,390,000.00|-|16,525,818.36|71,785,535.31|-|-|88,311,353.67|40.62|40.62|1,403,032.78|1,403,032.78|4.79|Self-funding andloan|
|Housing Placement Project of No.8 Newport||||||||||||||
|Road of Zhanjiang Port||||||||||||||
|Third Phase Project of Mayong Port Area 2#|680,000,000.00|54,800,647.68|31,680,557.08|-|-|-|86,481,204.76|13.95|13.95|-|-|-|Self-funding|
|and Bulk Grain Warehouse of Berth 2#||||||||||||||
|Total|11,985,145,239.70|4,810,989,960.60|693,569,024.13|536,216,972.82|7,173,205.19|8,458,600.39|6,042,061,352.75|||123,974,704.19|18,024,652.47|||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 17. Right-of-use assets
RMB
|||||||
|-|-|-|-|-|-|
||||Machinery and|||
||Port and terminal||equipment, furniture|Motor vehicles and||
|Item||Buildings|||Total|
||facilities||and fixture and other|cargo ships||
||||equipment|||
|I. Total original carrying||||||
|amount||||||
|1. Closing balance of the||||||
|preceding period||||||
|Add: Changes in|5,700,962,016.69|181,521,736.14|1,258,730,412.59|38,350,000.00|7,179,564,165.42|
|accounting policies||||||
|Opening balance of the|5,700,962,016.69|181,521,736.14|1,258,730,412.59|38,350,000.00|7,179,564,165.42|
|period||||||
|2. Increase in the period|867,083,044.07|873,763.93|500,636,357.59|-|1,368,593,165.59|
|(1) Increase|4,126,336.15|873,763.93|-|-|5,000,100.08|
|(2) Increase in the scope|862,956,707.92|-|500,636,357.59|-|1,363,593,065.51|
|of consolidation||||||
|3. Decrease in the period|1,759,833.72|4,153,191.64|-|-|5,913,025.36|
|(1) No longer rent|1,759,833.72|4,153,191.64|-|-|5,913,025.36|
|4. Effect of changes in|9,116,308.87|223,408.64|1,495,885.78|-|10,835,603.29|
|foreign exchange||||||
|5. Closing balance of the|6,575,401,535.91|178,465,717.07|1,760,862,655.96|38,350,000.00|8,553,079,908.94|
|period||||||
|II. Total accumulated||||||
|depreciation||||||
|1. Closing balance of the||||||
|preceding period||||||
|Add: Changes in|154,527,827.83|17,054,980.36|430,316,612.97|28,100,712.71|630,000,133.87|
|accounting policies||||||
|Opening balance of the|154,527,827.83|17,054,980.36|430,316,612.97|28,100,712.71|630,000,133.87|
|period||||||
|2. Increase in the period|115,932,291.48|9,274,766.94|86,625,102.88|354,544.14|212,186,705.44|
|(1) Accrual of|105,551,670.80|9,274,766.94|37,156,366.83|354,544.14|152,337,348.71|
|depreciation||||||
|(2) Increase in the scope|10,380,620.68|-|49,468,736.05|-|59,849,356.73|
|of consolidation||||||
|3. Decrease in the period|921,797.41|207,659.58|-|-|1,129,456.99|
|(1) No longer rent|921,797.41|207,659.58|-|-|1,129,456.99|
|4. Effect of changes in|4,210,734.14|275,523.71|529,333.72|-|5,015,591.57|
|foreign exchange||||||
|5. Closing balance of the|273,749,056.04|26,397,611.43|517,471,049.57|28,455,256.85|846,072,973.89|
|period||||||
|III. Total provision for||||||
|impairment losses||||||
|1. Opening balance of the|-|-|-|-|-|
|period||||||
|2. Increase in the period|-|-|-|-|-|
|3. Decrease in the period|-|-|-|-|-|
|4. Closing balance of the|-|-|-|-|-|
|period||||||
|IV. Book value||||||
|1. Closing balance|6,301,652,479.87|152,068,105.64|1,243,391,606.39|9,894,743.15|7,707,006,935.05|
|2. Opening balance|5,546,434,188.86|164,466,755.78|828,413,799.62|10,249,287.29|6,549,564,031.55|

 (1) Charged to profit or loss
RMB
||||
|-|-|-|
|||For the period from|
|Buildings|||
|||1 January to 30 June 2019|
|Depreciation cost of right-of-use assets (Note 1)|152,337,348.71||
|Interest expense of lease liabilities (Note 2)|51,328,052.46||
|Short-term lease expense|69,047,828.93||
|Lease expense of low value assets|1,474,971.38||
|Variable lease payments not included in the measurement of the lease liability (Note 3)|-||
|Income from sublease of right-of-use assets|-||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 17. Right-of-use assets - continued
(1) Charged to profit or loss - continued
Note 1: In the period from 1 January to 30 June 2019, there is no depreciation cost of the right-of- use assets capitalized.
Note 2: In the period from 1 January to 30 June 2019, there is no interest expense of the lease liabilities capitalized.
Note 3: In the period from 1 January to 30 June 2019, there are no variable lease payments not included in the measurement of the lease liability.
(2) For the period from 1 January to 30 June 2019, the cash outflow in the lease of the Group is RMB 196,929,540.74 in total.
18. Intangible assets
(1) Summary of intangible assets
RMB
||||||
|-|-|-|-|-|
||Land use rights|Port operating rights|Others|Total|
|I. Total original carrying amount|||||
|1.Opening balance|13,097,878,517.45|10,511,520,659.11|1,124,069,969.28|24,733,469,145.84|
|2.Increase in the current period|4,205,210,022.35|3,739,450.15|74,148,161.32|4,283,097,633.82|
|(1)Purchase|188,314,150.13|3,739,450.15|37,842,369.22|229,895,969.50|
|(2)Effect of changes in the scope of|4,016,895,872.22|-|36,305,792.10|4,053,201,664.32|
|consolidation|||||
|(3) Other increase|-|-|-|-|
|3. Decrease in the current period|1,712,988,111.05|5,075,443.00|-|1,718,063,554.05|
|(1)Disposal|1,712,988,111.05|-|-|1,712,988,111.05|
|(2)Other decrease|-|5,075,443.00|-|5,075,443.00|
|4.Effect of changes in foreign exchange|6,673,024.98|-125,819,128.26|-60,167,965.83|-179,314,069.11|
|5.Closing balance|15,596,773,453.73|10,384,365,538.00|1,138,050,164.77|27,119,189,156.50|
|II. Accumulated amortization|||||
|1.Opening balance|2,433,897,714.42|1,268,696,311.70|269,857,075.18|3,972,451,101.30|
|2. Increase in the current period|626,300,807.87|119,100,694.30|59,654,586.65|805,056,088.82|
|(1)Accrual of amortization|165,887,689.51|119,100,694.30|33,777,905.10|318,766,288.91|
|(2)Effect of changes in the scope of|460,413,118.36|-|25,876,681.55|486,289,799.91|
|consolidation|||||
|3. Decrease in the current period|20,706,821.06|-|-|20,706,821.06|
|(1)Disposal|20,706,821.06|-|-|20,706,821.06|
|4.Effect of changes in foreign exchange|2,043,488.13|7,783,580.05|1,684,049.48|11,511,117.66|
|5.Closing balance|3,041,535,189.36|1,395,580,586.05|331,195,711.31|4,768,311,486.72|
|III. Total provision for impairment losses|||||
|1. Opening balance|-|-|-|-|
|2. Increase in the current period|-|-|-|-|
|3. Decrease in the current period|-|-|-|-|
|4. Closing balance|-|-|-|-|
|IV. Total book value|||||
|1. Closing balance|12,555,238,264.37|8,988,784,951.95|806,854,453.46|22,350,877,669.78|
|2. Opening balance|10,663,980,803.03|9,242,824,347.41|854,212,894.10|20,761,018,044.54|

(2) Land use rights without ownership certificates on 30 June 2019:
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Land use rights|1,158,038,088.11|1,383,494,095.83|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 19. Development expenditure
||||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|||||||||Decrease|||||||
|||||Changes in thescope ofconsolidation|||||||||||
|||||||||Intangible||Fixed assets||Profit or loss for|||
||Item||1 January 2019|||Increase||||||||30 June 2019|
|||||||||assets||transferred in||the current year|||
|||||||||transferred in||||transferred in|||
|Strte|torage tank for crude oil|-||2,672,258.37|-||-||-||-||2,672,258.37||
||ansportation and||||||||||||||
||mperature regulation||||||||||||||
|Dactrol|evelopment and|-||4,163,708.08|-||-||-||-||4,163,708.08||
||pplication of automatic||||||||||||||
||ontrol system for oil||||||||||||||
||ansportation process in||||||||||||||
||d tank area||||||||||||||
|Rkptr|esearch and application of|-||2,319,112.65|-||-||-||-||2,319,112.65||
||ey equipment for||||||||||||||
||etrochemical products||||||||||||||
||ain loading||||||||||||||
|Dacoim|evelopment and|-||-|1,311,820.14||-||-||-||1,311,820.14||
||pplication of automatic||||||||||||||
||ontrol system for heavy||||||||||||||
||l, diesel, gasoline and||||||||||||||
||ethanol process||||||||||||||
|O|thers|-||5,813,227.72|2,017,159.78||-||-||1,075,674.72||6,754,712.78||
|T|otal|-||14,968,306.82|3,328,979.92||-||-||1,075,674.72||17,221,612.02||

 20. Goodwill
(1) Carrying amount of goodwill
RMB
|||||||
|-|-|-|-|-|-|
|||||Effect of changes||
|Investee|Opening balance|Increase|Decrease|in foreign|Closing balance|
|||||exchange||
|TCP Participações S.A. ((hereinafter referred|4,284,229,939.11|-|-|-608,574,723.71|3,675,655,215.40|
|to as “TCP”)||||||
|Mega Shekou Container Terminals Limited|1,815,509,322.42|-|-|-|1,815,509,322.42|
|China Merchants Port Holdings Co., Ltd.|993,992,000.00|-|-|-|993,992,000.00|
|Shantou CMPort Group Co., Ltd.|552,317,736.65|-|-|-|552,317,736.65|
|Zhanjiang Port (Group) Co., Ltd.|-|472,403,326.13|-|-|472,403,326.13|
|Shenzhen Mawan Project|408,773,001.00|-|-|-|408,773,001.00|
|Others|281,073,843.17|-|-|-|281,073,843.17|
|Total|8,335,895,842.35|472,403,326.13|-|-608,574,723.71|8,199,724,444.77|

 21. Long-term prepaid expenses
RMB
||||||||
|-|-|-|-|-|-|-|
|||Effect of changes in|||||
||||Increase in the current|Amortization in the|||
|Item|Opening balance|the scope of|||Other decrease|Closing balance|
||||period|current period|||
|||consolidation|||||
|Construction expenditure|164,567,384.97|-|-|6,279,927.10|8,163,265.59|150,124,192.28|
|of Tonggu sea-route|||||||
|Relocation|40,107,549.49|-|-|528,890.76|-|39,578,658.73|
|project of Nanhai Rescue|||||||
|Bureau|||||||
|Expenditures for the|21,163,538.17|-|736,688.07|1,110,387.77|-|20,789,838.47|
|improvement of leased|||||||
|fixed assets|||||||
|Others|9,867,964.58|2,630,870.77|644,416.56|1,896,622.10|-|11,246,629.81|
|Total|235,706,437.21|2,630,870.77|1,381,104.63|9,815,827.73|8,163,265.59|221,739,319.29|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 22. Deferred tax assets and deferred tax liabilities
(1) Deferred tax assets without offsetting
RMB
||||||||
|-|-|-|-|-|-|-|
||Closing balance|||Opening balance|||
|Item|Deductible temporarydifferences|||Deductible temporarydifferences|||
||||Deferred tax assets|||Deferred tax assets|
|Unrealized profit|125,834,621.88|31,458,655.47||-|-||
|Deductible losses|111,996,198.81|30,019,775.94||86,136,992.42|23,604,794.05||
|Deferred income|43,594,095.81|10,416,799.69||50,033,346.52|11,382,687.30||
|Provision for credit loss|37,760,599.60|9,422,605.13||32,805,128.88|8,213,219.45||
|Depreciation of fixed assets|36,888,128.12|8,213,097.76||22,036,522.49|4,514,995.56||
|Provisions|12,120,312.81|4,120,906.36||19,470,820.72|6,620,078.85||
|Amortization of computer software|19,764,353.64|4,941,088.41||16,453,443.95|4,113,360.99||
|Organization costs|14,386,394.26|3,287,938.27||14,386,394.26|3,287,938.27||
|Provision for impairment losses ofassets|9,509,794.03|2,294,396.23||2,258,081.96|481,468.22||
|Others|49,849,699.16|12,105,643.28||17,635,286.54|4,489,614.50||
|Total|461,704,198.12|116,280,906.54||261,216,017.74|66,708,157.19||

 (2) Deferred tax liabilities without offsetting
RMB
||||||||
|-|-|-|-|-|-|-|
||Closing balance|||Opening balance|||
|Item|Taxable temporarydifferences||Deferred taxliabilities|Taxable temporarydifferences||Deferred tax|
|||||||liabilities|
|Withholding dividend income tax|22,578,788,764.06|1,548,211,477.87||17,819,027,902.41|1,138,273,886.12||
|Fair value adjustment of assetsacquired by business combination|8,444,344,672.19|1,927,468,106.56||6,415,001,869.22|1,431,954,458.35||
|Changes in fair value of other equityinvestments|137,657,500.00|34,414,375.00||136,717,500.00|34,179,375.00||
|Changes in fair value of other non-current financial assets|1,783,269,566.40|241,344,319.10||930,040,371.21|105,285,399.58||
|Depreciation of fixed assets|719,586,297.86|170,393,142.56||754,359,502.42|174,592,634.60||
|Others|118,186,490.94|28,203,144.45||114,027,794.35|26,789,187.62||
|Total|33,781,833,291.45|3,950,034,565.54||26,169,174,939.61|2,911,074,941.27||

 (3) Deferred tax assets or liabilities that are presented at the net amount after offsetting RMB
||||||||
|-|-|-|-|-|-|-|
||Closing amount ofdeferred tax assetsand liabilities thatare offset||Closing amount ofdeferred tax assetsor liabilities afteroffsetting|Opening amount ofdeferred tax assetsand liabilities thatare offset||Opening amount of|
|||||||deferred tax assets|
|Item|||||||
|||||||or liabilities after|
|||||||offsetting|
|Deferred tax assets|-|116,280,906.54||-|66,708,157.19||
|Deferred tax liabilities|-|3,950,034,565.54||-|2,911,074,941.27||

 (4) Details of unrecognized deferred tax assets
RMB
||||||
|-|-|-|-|-|
|Item||Closing balance||Opening balance|
|Deductible temporary differences|461,790,385.58||237,418,074.51||
|Deductible losses|1,644,407,202.74||1,291,865,454.88||
|Total|2,106,197,588.32||1,529,283,529.39||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 22. Deferred tax assets and deferred tax liabilities - continued
(4) Details of unrecognized deferred tax assets - continued
Note: The Group recognizes deferred income tax assets based on the future taxable income that is probable to be used to offset the deductible temporary differences and deductible losses, deferred income tax assets that are deductible for temporary differences and deductible losses that exceed future taxable income.
(5) Deductible losses for unrecognized deferred tax assets will be expired in the following years RMB
|||||||
|-|-|-|-|-|-|
|Year||Closing balance||Opening balance|Note|
|2019|34,515,987.14||132,642,333.11|||
|2020|194,597,711.55||110,359,740.81|||
|2021|200,164,162.90||151,793,398.29|||
|2022|586,560,958.76||320,679,566.41|||
|2023|583,211,786.09||576,351,741.67|||
|2024|45,317,767.22||-|||
|No expiration date|38,829.08||38,674.59|||
|Total|1,644,407,202.74||1,291,865,454.88|||

23. Other non-current assets
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Dachan Bay Harbor Second Phase land compensation(Note)|916,884,222.48|-|
|Prepayment of waterway engineering|884,586,447.37|-|
|Prepayments of land use rights|132,435,419.28|175,908,026.15|
|Prepayments of fixed assets|107,095,284.17|174,039,051.91|
|Prepayments of terminal franchise|30,291,234.89|30,383,609.79|
|Others|8,481,134.85|14,860,798.13|
|Total|2,079,773,743.04|395,191,485.98|

 Note: On 24 December 2018, Shenzhen City Planning and Land Resources Committee, Shenzhen Qianhai Shenzhen Hong Kong Modern Service Industry Cooperation Zone Administration, China Merchants Group, and other relevant parties signed China Merchants Group Qianhai Logistics Area Land Consolidation Agreement. According to the agreement,55% of the total land area of T102-0166, T102-0167 land plots held by the subsidiaries of the Company and the corresponding water front (land area of
approximately 531,300 square meters) have been transferred to DaChan Bay Harbor Second Phase, with respect to which the change of land use right has not been completed as of 30 June 2019.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 24. Short-term borrowings
(1) Classification of short-term borrowings
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Credit loan|7,515,282,519.50|3,425,291,312.62|
|Interest payable of short term loan|50,737,940.96|2,074,199.59|
|Total|7,566,020,460.46|3,427,365,512.21|

 (2) As at 30 June 2019, the Group has no short-term loans that were overdue.
25. Notes payable
||||||
|-|-|-|-|-|
|Type||Closing balance||Opening balance|
|Bank acceptance bills|1,720,560.00||-||
|Commercial acceptance bills|67,699,331.54||-||
|Total|69,419,891.54||-||

 26. Accounts payable
(1) Details of accounts payable are as follows:
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Service fee|142,515,777.45|132,946,488.81|
|Construction fee|122,598,544.68|115,371,240.88|
|Material purchase|121,165,996.00|76,365,058.49|
|Equipment payments|21,060,925.01|659,317.15|
|Rental fee|2,477,299.61|10,564,893.93|
|Others|134,369,482.27|93,213,691.71|
|Total|544,188,025.02|429,120,690.97|

 (2) Significant accounts payable aged more than one year
RMB
|||||
|-|-|-|-|
|Item||Amount|Reason for outstanding|
||19,760,164.09|||
|CCCC Third Harbor Engineering Co., Ltd.||||

27. Receipts in advance
(1) Summary of receipts in advance
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Service fee receipt in advance|14,791,622.60|23,038,672.44|
|Rental fee receipt in advance|5,808,264.42|5,536,804.56|
|Others|7,604,739.80|595,232.86|
|Total|28,204,626.82|29,170,709.86|

(2) As at 30 June 2019, there is no significant receipts in advance aged more than one year.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 28. Contract liabilities
(1) Summary of contract liabilities
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Service fee received in advance|77,421,427.83|24,353,966.50|
|Port charges received in advance|42,173,909.04|11,657,235.81|
|Warehousing fee received in advance|-|8,705,589.57|
|Other|31,736,020.19|5,277,103.62|
|Total|151,331,357.06|49,993,895.50|

 (2) As at 30 June 2019, there is no significant contract liabilities aged more than one year. (3) Statement of material changes in the contract liabilities:
For the period from 1 January to 30 June 2019, the amount of revenue recognized in the book value of contract liabilities at the beginning of 2019 is RMB 40,166,792.15, including contract liabilities arising from settled unfinished funds resulting from the advance payment of labor contracts amounted to RMB 18,557,435.49, the contract liabilities arising from settled unfinished funds resulting from the advance payment of port contracts amounted to RMB 8,882,676.32, the contractual liabilities arising from the settled unfinished funds formed by the pre-collection warehousing fee contract amounted to RMB 8,705,589.57, and the contractual liabilities arising from the settlement of unfinished funds formed by other contracts amounted to RMB 4,021,090.77.
(4) Qualitative and quantitative analysis of Contract liabilities
The contract liability is mainly the amount received by the Group to provide port services to customers. The payment is collected according to the contract payment time. The Group recognizes contract revenue based on the progress of the contract. The contract liabilities will be recognized as income after the Group fulfills its performance obligations. 29. Employee benefits payable
(1) Details of employee benefits payable are as follows
RMB
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|||||Effect of changes in||||||
|Item||Opening balance||the scope of|Increase||Decrease||Closing balance|
|||||consolidation||||||
|1. Short-term benefits|431,714,138.23||74,044,893.78||1,212,709,067.84|1,200,770,951.45||517,697,148.40||
|2. Post-employment benefits -|2,286,649.91||-||99,321,263.45|96,077,066.19||5,530,847.17||
|Projected benefits obligation||||||||||
|3. Termination benefits|-||8,586,268.52||4,501,183.45|4,340,027.01||8,747,424.96||
|4. Others|-511,232.74||-||1,878,372.74|1,440,435.91||-73,295.91||
|Total|433,489,555.40||82,631,162.30||1,318,409,887.48|1,302,628,480.56||531,902,124.62||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 29. Employee benefits payable - continued
(2) Short-term benefits
RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|||||Effect of changes in|||||||
|Item||Opening balance||the scope of||Increase||Decrease||Closing balance|
|||||consolidation|||||||
|I. Wages and salaries, bonuses,|409,390,929.61||72,201,271.35||1,017,637,118.17||1,010,126,621.98||489,102,697.15||
|allowances and subsidies|||||||||||
|II. Staff welfare|-||-||45,333,010.49||43,981,094.49||1,351,916.00||
|III. Social insurance charges|5,145,526.57||-||63,565,967.78||60,044,491.36||8,667,002.99||
|Including: Medical insurance|4,418,339.26||-||49,050,719.18||46,223,681.80||7,245,376.64||
|Work injury insurance|-||-||4,411,503.62||4,411,474.15||29.47||
|Maternity insurance|-||-||2,744,364.47||2,744,344.98||19.49||
|Others|727,187.31||-||7,359,380.51||6,664,990.43||1,421,577.39||
|IV. Housing funds|-||-||65,490,371.16||65,490,371.16||-||
|V. Labor union and employee|17,166,673.76||1,843,622.43||16,662,090.67||17,114,880.56||18,557,506.30||
|education funds|||||||||||
|VI. Others|11,008.29||-||4,020,509.57||4,013,491.90||18,025.96||
|Total|431,714,138.23||74,044,893.78||1,212,709,067.84||1,200,770,951.45||517,697,148.40||

 (3) Projected benefits obligation
RMB
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|||||Effect of changes in||||||
|Item||Opening balance||the scope of||Increase||Decrease|Closing balance|
|||||consolidation||||||
|I. Basic pension|1,620,436.89||-||78,367,334.31||74,571,978.93||5,415,792.27|
|II. Unemployment insurance|551,158.12||-||1,610,114.25||2,161,272.37||-|
|III. Enterprise annuity plan|115,054.90||-||19,343,814.89||19,343,814.89||115,054.90|
|Total|2,286,649.91||-||99,321,263.45||96,077,066.19||5,530,847.17|

 Note: The Company and its subsidiaries participates in the social security contributions and the unemployment insurance plan established by government institutions as required. According to such plans, the Group contributes in proportion to the local government. Except for the above-mentioned deposit fees, the Group have no outstanding
contributions to be paid to the social security contributions and the unemployment insurance plan. The corresponding expenses are included in the current profit and loss or the cost of related assets when incurred.
30. Taxes payable
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Enterprise income tax|1,383,438,005.02|271,954,754.74|
|VAT|10,641,083.51|8,200,265.65|
|Others|136,511,472.97|65,028,402.03|
|Total|1,530,590,561.50|345,183,422.42|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 31. Other payables
(1) Other payables
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Interest payable|-|-|
|Dividends payable|1,574,587,304.24|66,052,207.09|
|Other payables|1,847,188,838.87|1,624,072,694.20|
|Total|3,421,776,143.11|1,690,124,901.29|

 (2) Interest payable
As at 30 June 2019, there is no significant other overdue interest payables.
(3) Dividends payable
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Ordinary share dividends|1,574,587,304.24|66,052,207.09|
|Including: China Merchants Union Development Co., Ltd.|484,126,088.18|-|
|("CMU")|||
|China Merchants Investment Development Co., Ltd.|117,851,351.28|-|
|("CMID")|||
|China Merchants Group Gangtong Development|42,280,092.00|-|
|(Shenzhen) Co., Ltd.|||
|Yihai Kerry Investment Co., Ltd. ("Yihai Kerry ")|37,402,426.09|37,402,426.09|
|Sinotrans South China Co., Ltd.|25,949,781.00|25,949,781.00|
|China Merchants Zhangzhou Development Zone Co., Ltd|. 22,400,000.00|-|
|Broadford Global Limited|5,675,237.74|-|
|Qingdao Port (Group) Co., Ltd.|2,700,000.00|2,700,000.00|
|Orientrue Holdings Company Limited|1,924,529.50|-|

 As at 30 June 2019, the dividend payable for more than one year is RMB 63,352,207.09, dividends not yet received by the investor.
(4) Other payables
(a) Disclosure of other payables by nature
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Amount payable for construction and quality warranty|758,057,595.26|660,870,685.70|
|Prepaid expenses|156,686,958.44|140,305,423.54|
|Deposits|148,452,393.73|149,705,612.54|
|Customer discount|108,711,987.15|128,787,894.63|
|Balance of land use rights transfer|104,554,050.90|93,258,350.90|
|Port construction and security fee|67,878,286.06|62,255,593.38|
|Others|502,847,567.33|388,889,133.51|
|Total|1,847,188,838.87|1,624,072,694.20|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 31. Other payables - continued
(4) Other payables - continued
(b) Significant Other payables aged more than one year
RMB
||||||
|-|-|-|-|-|
|Company name||Closing balance||Reason for outstanding|
|China Merchants Zhangzhou Development|93,258,350.90||The spare payment of land use rightsperchase||
|Zone Co., Ltd.|||||
||54,763,901.68||Payments to be paid after confirmationby both parties||
|Shantou Transportation Bureau|||||
||39,476,414.00||The contracted settlement condition hasnot been reached||
|CCCC Third Harbor Engineering Co., Ltd.|||||
||38,306,840.00||The contracted settlement condition hasnot been reached||
|CCCC Fourth Harbor Engineering Co., Ltd.|||||
||23,151,343.70||The contracted settlement condition hasnot been reached||
|Shenzhen Merchants Construction Co., Ltd.|||||
|Qingdao Maritime Bureau|20,713,982.12||Outstanding port construction fee||
|China Merchants property Co., Ltd.|17,863,298.54||Outstanding property management fee||
||10,000,000.00||The contracted settlement condition hasnot been reached||
|Guangdong Hengtai Tong Industrial Co., Ltd.|||||
||6,729,157.83||Payments to be paid after confirmationby both parties||
|Shanghai Zhenhua Heavy Industries Co., Ltd.|||||
||5,884,632.48||The contracted settlement condition hasnot been reached||
|Harman Technology (Shenzhen) Co., Ltd.|||||
|Total|310,147,921.25||||

32. Non-current liabilities due within one year
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Long-term loans due within one year|2,512,696,253.45|1,913,116,720.26|
|Including：Credit loan|1,032,888,232.66|375,382,058.46|
|Guaranteed loan|995,041,678.77|1,090,500,000.00|
|Mortgage loan|484,766,342.02|447,234,661.80|
|Interest Payable of long term loan|42,229,771.06|61,171,289.96|
|Bonds payable due within one year|299,829,041.05|299,531,506.81|
|Interest Payable of Bonds payable|476,624,412.56|492,300,138.05|
|Long-term payable due within one year|2,453,728.30|30,635,607.84|
|Long-term employee benefits payable due within one year|19,100,000.00|19,100,000.00|
|Lease liabilities due within one year|340,498,719.67||
|Other non-current liabilities due within one year|89,024,962.46|87,465,615.05|
|Total|3,782,456,888.55|2,903,320,877.97|

 33. Other current liabilities
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Short-term bonds payable|1,307,395,212.33|200,000,000.00|
|Accrued professional agency fee|110,609,031.27|116,064,056.75|
|Joint venture loan|-|241,927,341.05|
|Others|38,063,041.22|44,668,324.00|
|Total|1,456,067,284.82|602,659,721.80|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
33. Other current liabilities - continued
Changes of short-term bonds payable
RMB
|||||||||||||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
||||||||||||||Effect of changes||||||Discount or|||||
||||||Date of||Term of the||||Opening||||Amount issued in||Interest accrued at||||Repayment in|||
||Name of bond||Face value||||||Amount of issue||||in the scope of||||||premium||||Closing balance|
||||||issue||bond||||balance||||the current period||par during the period||||the current period|||
||||||||||||||consolidation||||||amortization|||||
|4c|.73%, RMB 200 million|200,000,000.00||24/04/2018||267 days||200,000,000.00||200,000,000.00||-||-||570,191.79||-||200,570,191.79||-||
||orporate bond|||||||||||||||||||||||
|3c|.08%, RMB 700 million|700,000,000.00||04/06/2019||270 days||700,000,000.00||-||-||700,000,000.00||1,476,712.33||-||-||701,476,712.33||
||orporate bond|||||||||||||||||||||||
|2c|.98%, RMB 300 million|300,000,000.00||04/06/2019||180 days||300,000,000.00||-||-||300,000,000.00||612,328.77||-||-||300,612,328.77||
||orporate bond|||||||||||||||||||||||
|5c|.70%, RMB 300 million|300,000,000.00||16/05/2018||272 days||300,000,000.00||-||312,325,273.97||-||324,041.10||-||312,649,315.07||-||
||orporate bond|||||||||||||||||||||||
|5c|.97%, RMB 300 million|300,000,000.00||04/06/2018||272 days||300,000,000.00||-||311,914,102.74||-||1,334,390.41||-||313,248,493.15||-||
||orporate bond|||||||||||||||||||||||
|3c|.80%, RMB 300 million|300,000,000.00||18/01/2019||277 days||300,000,000.00||-||300,437,260.27||-||4,868,910.96||-||-||305,306,171.23||
||orporate bond|||||||||||||||||||||||
|T|otal|2,100,000,000.00||||||2,100,000,000.00||200,000,000.00||924,676,636.98||1,000,000,000.00||9,186,575.36||-||826,468,000.01||1,307,395,212.33||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 34. Long-term borrowings
(1) Classification of long-term loans
RMB
||||||
|-|-|-|-|-|
|Item||Closing balance||Opening balance|
|Credit borrowings|3,750,706,673.68||2,032,494,533.83||
|Guaranteed borrowings (Note 1)|3,248,336,900.35||3,657,846,864.58||
|Mortgage borrowings (Note 2)|2,970,339,893.61||3,194,255,164.03||
|Total|9,969,383,467.64||8,884,596,562.44||
|Less: Long-term borrowings due within one year|2,512,696,253.45||1,913,116,720.26||
|Including: Credit borrowings|1,032,888,232.66||375,382,058.46||
|Guaranteed borrowings|995,041,678.77||1,090,500,000.00||
|Mortgage borrowings|484,766,342.02||447,234,661.80||
|Long-term borrowings due after one year|7,456,687,214.19||6,971,479,842.18||

 During the period, the annual interest rate of the borrowing is1.20% to8.29%.
Note 1: The loan was guaranteed by Shenzhen Mawan Terminals Co., Ltd., China Merchants Port Services (Shenzhen) Co., Ltd. ("CMPS"), and China Merchants Port Holdings Co., Ltd ("CMPH").
Note 2: As at 30 June 2019, the Group obtained the long-term loan amounted to RMB 2,970,339,893.61 is firm subject to the entire share capital of Colombo International Container Terminals Limited and the entire interest of Thesar Maritime Limited, and the land use rights, fixed assets and construction in progress held by Guangdong Yide Port Co., Ltd. (hereinafter referred to as "Yide Port") (31 December 2018: RMB 3,194,255,164.03).
Details of mortgage loan are as follows:
RMB
||||||||
|-|-|-|-|-|-|-|
|Company name||Closing balance||Opening balance||collateral|
||1,439,836,324.38||1,543,473,787.28||The entire equity of Colombo InternationalContainer Terminals Limited held by theGroup||
|China Development Bank Corporation|||||||
|International Finance Corporation|488,074,824.13||529,891,283.72||The entire equity of Thesar MaritimeLimited held by the Group||
|African Development Bank|224,250,594.86||243,463,562.79||||
|Nederlandse Financierings-Maatschappij voor|184,676,960.49||200,499,404.66||||
|Ontwikkelingslanden N.V.|||||||
|The Opec Fund For International Development|158,294,537.57||171,856,632.57||||
|Societe de Promotion et de Participation pour la|158,294,537.55||171,856,632.55||||
|Cooperation Economique S.A|||||||
|Deutsche Investitions-und|131,912,114.63||143,213,860.46||||
|Entwicklungsgesellschaft|||||||
|MBH|||||||
||185,000,000.00||190,000,000.00||Yide Port fixed assets and construction inprogress (refer to the details in Notes (V)61).||
|China Construction Bank Shunde Branch|||||||
|Total|2,970,339,893.61||3,194,255,164.03||||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 35. Bonds payable
(1) Bonds payable
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|4.375%, USD 900 million corporate bond|6,141,707,321.75|6,126,655,733.91|
|5.000%, USD 600 million corporate bond|4,071,538,668.40|4,062,553,267.60|
|4.750%, USD 500 million corporate bond|3,421,385,262.73|3,414,652,244.84|
|5.000%, USD 500 million corporate bond|3,417,266,612.50|3,408,446,692.17|
|4.890%, RMB 2,500 million corporate bond|2,500,000,000.00|2,500,000,000.00|
|3.500% , USD 200 million corporate bond|1,372,579,877.36|1,369,419,343.41|
|IPCA + 7.8164% BRL 428 million corporate bond|732,891,831.57|715,739,814.47|
|5.150%, RMB 500 million corporate bond|-|500,000,000.00|
|2.970%, RMB 300 million corporate bond|299,829,041.05|299,531,506.81|
|4.980%, RMB 400 million corporate bond|400,000,000.00|-|
|Total|22,357,198,615.36|22,396,998,603.21|
|Deduct :Bonds payable due within one year|299,829,041.05|299,531,506.81|
|Bonds payable due after one year|22,057,369,574.31|22,097,467,096.40|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
35. Bonds payable - continued
(2) Changes of bonds payable
RMB
|||||||||||||||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
||||||||||||||Effect of||||Interest||||||Effect of|||
||||||||Term||||||||Amount issued||||Discount or|||||||
||Name of bonds||Face value||Date of||of the||Amount of issue||Opening balance||changes in||in the current||accrued at par||premium||Repayment in the||changes in||Closing balance|
||||||issue||||||||scope of||||during the||||current period||foreign|||
||||||||bond||||||consolidation||period||period||amortization||||exchange|||
|c|4.375%, USD 900 million|USD 900,000,000.00||06/08/2018||5||USD 900,000,000.00||6,126,655,733.91||-||-||138,112,917.80||4,810,791.34||-||10,240,796.50||6,141,707,321.75||
||orporate bond|||||||||||||||||||||||||
|c|5.000%, USD 600 million|USD 600,000,000.00||06/08/2018||10||USD 600,000,000.00||4,062,553,267.60||-||-||103,771,027.79||2,207,502.87||-||6,777,897.93||4,071,538,668.40||
||orporate bond|||||||||||||||||||||||||
|c|4.750%, USD 500 million|USD 500,000,000.00||03/08/2015||10||USD 500,000,000.00||3,414,652,244.84||-||-||81,386,744.32||1,046,539.93||-||5,686,477.96||3,421,385,262.73||
||orporate bond|||||||||||||||||||||||||
|c|5.000%, USD 500 million|USD 500,000,000.00||04/05/2012||10||USD 500,000,000.00||3,408,446,692.17||-||-||87,643,272.81||3,116,948.93||-||5,702,971.40||3,417,266,612.50||
||orporate bond|||||||||||||||||||||||||
|c|4.890%, RMB 2.5 billion|RMB2,500,000,000.00||21/04/2017||5||RMB 2,500,000,000.00||2,500,000,000.00||-||-||60,740,690.77||-||-||-||2,500,000,000.00||
||orporate bond|||||||||||||||||||||||||
|c|3.500%, USD 200 million|USD 200,000,000.00||03/08/2015||5||USD 200,000,000.00||1,369,419,343.41||-||-||24,553,352.02||874,133.91||-||2,286,400.04||1,372,579,877.36||
||orporate bond|||||||||||||||||||||||||
|I|PCA+7.8164%, BRL 428|BRL 428,047,000.00||07/11/2016||6||BRL 428,047,000.00||715,739,814.47||-||-||51,150,396.30||5,638,736.83||-||11,513,280.27||732,891,831.57||
||million corporate bond|||||||||||||||||||||||||
|c|4.980% RMB 400 million|RMB 400,000,000.00||10/12/2018||3||RMB 400,000,000.00||-||400,000,000.00||-||9,878,136.99||-||-||-||400,000,000.00||
||orporate bond|||||||||||||||||||||||||
|c|2.970% RMB 300 million|RMB 300,000,000.00||11/10/2016||3||RMB 300,000,000.00||299,531,506.81||-||-||4,418,383.58||297,534.24||-||-||299,829,041.05||
||orporate bond|||||||||||||||||||||||||
|c|5.150% RMB 500 million|RMB500,000,000.00||06/02/2018||3||RMB 500,000,000.00||500,000,000.00||-||-||2,189,017.78||-||500,000,000.00||-||-||
||orporate bond|||||||||||||||||||||||||
|||||||||||22,396,998,603.21||400,000,000.00||-||563,843,940.16||17,992,188.05||500,000,000.00||42,207,824.10||22,357,198,615.36||
||Total|||||||||||||||||||||||||
||Less: Bonds payable due|||||||||299,531,506.81||-||-||-||297,534.24||-||-||299,829,041.05||
||within one year|||||||||||||||||||||||||
||Bonds payable due after one|||||||||22,097,467,096.40||400,000,000.00||-||563,843,940.16||17,694,653.81||500,000,000.00||42,207,824.10||22,057,369,574.31||
||year|||||||||||||||||||||||||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 36. Lease liabilities
(1) Lease liabilities
RMB
||||
|-|-|-|
|Buildings|Closing balance|Opening balance|
|Lease liabilities|2,081,388,281.55||
|Less: Lease liabilities due within one year|340,498,719.67||
|Lease liabilities due after one year|1,740,889,561.88||

(2) Term of lease liabilities
RMB
|||
|-|-|
|Item|Closing balance|
|Minimum lease payments under non-cancellable operating||
|leases:||
|1st year subsequent to the balance sheet date|385,004,800.17|
|2nd year subsequent to the balance sheet date|407,945,838.33|
|3rd year subsequent to the balance sheet date|367,581,894.41|
|Subsequent periods|1,892,122,322.45|
|Total|3,052,654,855.36|

 37. Long-term payables
(1) Summary of long-term payables
RMB
|||||
|-|-|-|-|
|Item|Closing balance||Opening balance|
|Long-term payables|1,232,875,519.52|1,285,984,226.34||
|Special payables|39,131,256.82|38,841,499.68||
|Total|1,272,006,776.34|1,324,825,726.02||
|Less: Long-term payables due within one year|2,453,728.30|30,635,607.84||
|Long-term payables due after one year|1,269,553,048.04|1,294,190,118.18||

 (2) Details of long-term payables
RMB
|||||
|-|-|-|-|
|Item|Closing balance||Opening balance|
|Terminal management rights (Note1)|824,739,290.52|823,360,554.03||
|Payable to minority shareholders of subsidiaries (Note2)|398,321,315.80|390,658,146.52||
|Financing lease payable|-|71,965,525.79||
|Others|9,814,913.20|-||
|Total|1,232,875,519.52|1,285,984,226.34||
|Deduct :long-term payable due within one year|2,453,728.30|30,635,607.84||
|long-term payable due after one year|1,230,421,791.22|1,255,348,618.50||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 37. Long-term payables - continued
(2) Details of long-term payables - continued
Note 1: As at 12 August 2011, the Group reached a 35-year construction, operation and transfer agreement through the subsidiary Colombo International Container Terminals Limited and the Sri Lanka Port Authority on the construction, operation, management and development of the Colombo Port South Container Terminal (hereinafter referred to as for "BOT"). The above- mentioned terminal operating rights purchase amount is determined by discounting the amount to be paid in the future according to the current market interest rate according to the BOT agreement. As at 30 June 2019 and 31 December 2018, the amount was RMB 824,739,290.52 and RMB 823,360,554.03 respectively.
Note 2: It is an unsecured loan from minority shareholder of Thesar Maritime Limited, a subsidiary of the Company, which has an annual interest rate of4.65%.
(3) Special payables
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Refunds of Harbor Construction Fee(Note)|36,140,144.57|36,061,435.67|
|Employee housing fund|2,991,112.25|2,780,064.01|
|Total|39,131,256.82|38,841,499.68|

 Note: According to the "Port Construction Fee Management Measures" promulgated by the Ministry of Finance, this payment is dedicated to the construction of water transport infrastructure. The refund of the construction fee collected by the Group from the Shenzhen Municipal Transportation Bureau.
38. Long-term employee benefits payable
(1) Summary of long-term employee benefits payable
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Post-employment benefits-net debt of projected benefits obligation(Note)|702,116,337.27|385,323,310.21|
|Termination benefits|51,745,559.75|9,101,817.44|
|Total|753,861,897.02|394,425,127.65|
|Less:Long-term employee benefits payable due within one year|27,847,424.95|19,100,000.00|
|Long-term employee benefits payable due after one year|726,014,472.07|375,325,127.65|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 38. Long-term employee benefits payable - continued
(2) Changes in projected benefits obligation
Present value of projected benefits obligation:
RMB
||||||
|-|-|-|-|-|
|||Amount incurred in the||Amount incurred in the|
|Item|||||
|||current period||previous period|
|I. Opening balance|385,323,310.21||358,010,123.90||
|II. Benefit cost included in current period income|9,122,011.37||8,372,188.15||
|1. Current service cost|2,448,000.00||2,400,000.00||
|2. Post service cost|-5,988.63||-27,811.85||
|3. Interest adjustment|6,680,000.00||6,000,000.00||
|III. Benefit cost included in other comprehensive income|-5,940.71||-4,251.13||
|1. Acturial gains (losses)|-||-||
|2. Effect of currency rate changes|-5,940.71||-4,251.13||
|IV. Others changes|307,676,956.40||-8,173,681.12||
|1. Benefits paid|-9,963,043.60||-8,173,681.12||
|2. Changes in the scope of consolidation|317,640,000.00||-||
|V. Closing balance|702,116,337.27||358,204,379.80||

 Note: A subsidiary of the Company, provides supplementary post-employment benefit plans for retirees.
The Group hired a third-party actuary to estimate the present value of its above-mentioned retirement benefit plan obligations in an actuarial manner based on the expected cumulative welfare unit method. The Group recognizes the Group's liabilities based on the actuarial results. The relevant actuarial gains or losses are included in other comprehensive income and cannot be reclassified into profit or loss in the future. Past service costs are recognized in profit or loss for the period in which the plan is revised. The net interest is determined by multiplying the defined benefit plan net debt or net assets by the appropriate discount rate.
39. Provisions
RMB
|||||
|-|-|-|-|
|Item|Closing balance|Opening balance|Reason|
|Pending litigation (Note)|12,120,312.81|19,470,820.72|Note|
|Sales discount|29,451,496.01|15,480,571.55||
|Total|41,571,808.82|34,951,392.27||

Note： Is the estimated amount of compensation expected by TCP, the company's subsidiary, due to pending obligation.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 40. Deferred income
RMB
|||||||
|-|-|-|-|-|-|
||||Effect of changes in|||
|Item|Opening balance|Increase|the scope of|Decrease|Closing balance|
||||consolidation|||
|Government grants|228,658,214.64|305,552,280.00|962,525,700.54|20,048,198.10|1,476,687,997.08|
|The proceeds recognized against the|-|682,632,512.39|-|-|682,632,512.39|
|shareholding of Qianhai Industrial due to land||||||
|preparation(note)||||||
|Unrealized sale and lease back profit|-|-|1,902,769.80|216,223.90|1,686,545.90|
|Total|228,658,214.64|988,184,792.39|964,428,470.34|20,264,422.00|2,161,007,055.37|

 Note: On 24 December 2018, Shenzhen City Planning and Land Resources Committee, Shenzhen Qianhai Shenzhen Hong Kong Modern Service Industry Cooperation Zone Administration, China Merchants Group, and other relevant parties signed China Merchants Group Qianhai Logistics Area Land Consolidation Agreement. According to the agreement, the land use rights of Qianhai returned by the Company's subsidiaries amount to RMB 817,354,053.93, and the creditor's rights of land compensation due from China Merchants Chidi amount to RMB 5,693,300,571.00.
On 11 January 2019, China Merchants Qianhai Industrial (Shenzhen) Co., Ltd.(hereinafter referred to as " China Merchants Qianhai Industrial"), the subsidiaries of the Company and other relevant parties signed The Capital Increase Agreement of Shenzhen China Merchants Qianhai Industrial Development Co., Ltd. According to the agreement, the subsidiaries of the Company and other relevant parties shall make capital contribution to China Merchants Qianhai Industrial, with respect to which the capital contribution has not been completely completed as of 30 June 2019. Therefore, the unrealized internal gains and losses from14% equity interest in China Merchants Qianhai Industrial are recognized as liabilities of RMB 682,632,512.39.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 40. Deferred income - continued
Related to governmentgrants：
RMB
||||||||
|-|-|-|-|-|-|-|
||||Effect of changes in||||
|||||Recognized in other||Related to assets|
|Liability item|Opening balance|Increase|the scope of||Closing balance||
|||||income||/Related to income|
||||consolidation||||
|Port construction fee refund|-|-|510,107,118.35|-|510,107,118.35|Related to assets|
|Marine reclamation land refund|-|-|392,906,557.65|8,062,153.30|384,844,404.35|Related to assets|
|Dredging and widening project|-|300,000,000.00|-|-|300,000,000.00|Related to assets|
|Modern logistics special funds|115,360,000.04|-|-|319,999.98|115,040,000.06|Related to assets|
|Ro-ro terminal subsidy|47,775,000.00|-|-|612,499.98|47,162,500.02|Related to assets|
|Port construction subsidy fund|-|-|20,946,639.06|385,138.85|20,561,500.21|Related to assets|
|Cargo port fee allocation|-|-|22,819,438.96|229,110.85|22,590,328.11|Related to assets|
|Qianwan Bonded Logistics Park Project|15,304,301.08|-|-|528,625.92|14,775,675.16|Related to assets|
|Subsidized grain transfer project subsidy|8,142,857.12|-|-|-|8,142,857.12|Related to assets|
|Central budgetary support for bulk grain|7,472,916.67|-|-|-|7,472,916.67|Related to assets|
|transfer terminal projects|||||||
|Land transfer payment refund|-|-|6,680,000.00|-|6,680,000.00|Related to assets|
|AMPI|6,748,036.42|-|-|480,810.36|6,267,226.06|Related to assets|
|Oil to electricity project|6,017,089.67|-|-|392,418.96|5,624,670.71|Related to assets|
|Special fund for combat readiness tug|-|-|4,425,000.00|93,750.00|4,331,250.00|Related to assets|
|Automated terminal operation and|5,162,470.31|-|-|2,458,938.26|2,703,532.05|Related to assets|
|dispatching system special support|||||||
|project|||||||
|Special fund for industrial|-|-|2,690,000.00|50,000.00|2,640,000.00|Related to assets|
|informationization development of|||||||
|bonded logistics center|||||||
|Research and development of fully|2,737,023.07|-|-|622,912.43|2,114,110.64|Related to assets|
|automated intelligent terminal|||||||
|information investment based on cloud|||||||
|platform architecture|||||||
|Warfare gate subsidy|1,855,895.24|-|-|-|1,855,895.24|Related to assets|
|Green low carbon port project|1,403,900.02|-|-|210,585.00|1,193,315.02|Related to assets|
|Shore power subsidies|-|5,000,000.00|-|5,000,000.00|-|Related to assets|
|Others|10,678,725.00|552,280.00|1,950,946.52|601,254.21|12,580,697.31|Related to assets|
|Total|228,658,214.64|305,552,280.00|962,525,700.54|20,048,198.10|1,476,687,997.08||

41. Other non-current liabilities
RMB
||||||
|-|-|-|-|-|
|Item||Closing balance||Opening balance|
|TCP Operating rights liability (Note1)|3,415,258,427.24||3,260,547,002.45||
|Obligation to minority shareholders due to acquisition|629,342,778.85||579,195,304.56||
|(Note2)|||||
|Berth priority call right (Note3)|22,856,134.30||25,305,830.90||
|Total|4,067,457,340.39||3,865,048,137.91||
|Less: Other non-current liabilities due in one year|89,024,962.46||87,465,615.05||
|Including: TCP Operating rights liability|89,024,962.46||87,465,615.05||
|Other non-current liabilities due after one year|3,978,432,377.93||3,777,582,522.86||

 Note 1: As at 23 February 2018, CMPH, a subsidiary of the Company, acquired a90% stake in TCP and incorporate it into the consolidated financial statements of the Group. TCP has right to operate the port of paranagua. The relevant concession arrangement allows for operations in the relevant port for up to 2048. At 30 June 2019, with the relevant
authority, concession payment is payable on a monthly basis and is adjusted from time to
time, among other conditions, with reference to an official inflation index in Brazil.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 41. Other non-current liabilities - continued
Note 2: In February 2018, CMPH, a subsidiary of the Company, acquired a90% stake in TCP. According to the agreement, TCP minority shareholders can choose to sell their10% stake in TCP to China Merchants Port Holdings at a higher price than the market price or the BRL 320 million two years later. The Group recognizes the total amount of obligations related to the purchase of minority interests as liabilities.
Note 3: According to the berth priority call right agreed in the contract signed with the customer in 2003, the total amount is USD 14 million. The Group must give priority to the berthing requirements of the contract customers during the contract period. The Group amortized the berth priority right within 20 years. For the period from 1 January to 30 June 2019, the amount includes in operating income is RMB 2,449,696.60.
42. Share capital
RMB
|||||||||
|-|-|-|-|-|-|-|-|
|||Changes for the period||||||
|Item|Opening balance|New issue of|Bonus|Capitalization of|||Closing balance|
||||||Others|Subtotal||
|||share|issue|surplus reserve||||
|For the period from 1 January to 30 June 2019||||||||
|I. Restricted tradable shares||||||||
|1. State-owned shares|-|-|-|-|-|-|-|
|2. State-owned legal person|-|-|-|-|-|-|-|
|shares||||||||
|3. Other domestic shares|212,156.00|-|-|-|-42,554.00|-42,554.00|169,602.00|
|4. Other foreign shares|1,148,648,648.00|-|-|-|-|-|1,148,648,648.00|
|Total restricted tradable shares|1,148,860,804.00|-|-|-|-42,554.00|-42,554.00|1,148,818,250.00|
|II. Non-restricted tradable shares||||||||
|1. Ordinary shares denominated|464,855,324.00|-|-|-|3,000.00|3,000.00|464,858,324.00|
|in RMB||||||||
|2. Foreign capital shares listed|179,696,250.00|-|-|-|39,554.00|39,554.00|179,735,804.00|
|domestically||||||||
|3. Foreign capital shares listed|-|-|-|-|-|-|-|
|overseas||||||||
|4. Others|-|-|-|-|-|-|-|
|Total non-restricted tradable shares|644,551,574.00|-|-|-|42,554.00|42,554.00|644,594,128.00|
|III. Total shares|1,793,412,378.00|-|-|-|-|-|1,793,412,378.00|
|2018||||||||
|I. Restricted tradable shares||||||||
|1 State-owned shares|-|-|-|-|-|-|-|
|2. State-owned legal person|-|-|-|-|-|-|-|
|shares||||||||
|3. Other domestic shares|160,106.00|-|-|-|52,050.00|52,050.00|212,156.00|
|4. Other foreign shares|-|1,148,648,648.00|-|-|-|1,148,648,648.00|1,148,648,648.00|
|Total restricted tradable shares|160,106.00|1,148,648,648.00|-|-|52,050.00|1,148,700,698.00|1,148,860,804.00|
|II. Non-restricted tradable shares||||||||
|1. Ordinary shares denominated|464,859,300.00|-|-|-|-3,976.00|-3,976.00|464,855,324.00|
|in RMB||||||||
|2. Foreign capital shares listed|179,744,324.00|-|-|-|-48,074.00|-48,074.00|179,696,250.00|
|domestically||||||||
|3. Foreign capital shares listed|-|-|-|-|-|-|-|
|overseas||||||||
|4. Others|-|-|-|-|-|-|-|
|Total non-restricted tradable shares|644,603,624.00|-|-|-|-52,050.00|-52,050.00|644,551,574.00|
|III. Total shares|644,763,730.00|1,148,648,648.00|-|-|-|1,148,648,648.00|1,793,412,378.00|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 43. Capital reserve
RMB
||||||
|-|-|-|-|-|
|Item|Opening balance|Increase|Decrease|Closing balance|
|For the period from 1 January to 30 June 2019|||||
|Capital premium|19,429,694,090.05|61,436,266.04|16,957,921.94|19,474,172,434.15|
|Including：Capital contributed by investors|4,954,397,136.25|-|-|4,954,397,136.25|
|Differences arising from business combination|13,311,099,845.41|-|-|13,311,099,845.41|
|involving enterprises under common control|||||
|Others|1,164,197,108.39|61,436,266.04|16,957,921.94|1,208,675,452.49|
|Other capital reserve|-2,781,133.00|77,732,230.21|300,731.50|74,650,365.71|
|Including: Transfer from capital reserve under the previous|-2,781,133.00|-|-|-2,781,133.00|
|accounting system|||||
|Other changes in the owner's equity of the investee other|-|77,732,230.21|300,731.50|77,431,498.71|
|than net profit or loss, profit distribution, and other|||||
|comprehensive income changes under the equity method|||||
|Total|19,426,912,957.05|139,168,496.25|17,258,653.44|19,548,822,799.86|

 RMB
||||||
|-|-|-|-|-|
|Item|Opening balance|Increase|Decrease|Closing balance|
|2018|||||
|Capital premium|18,848,680,489.20|1,164,197,108.39|583,183,507.54|19,429,694,090.05|
|Including：Capital contributed by investors|4,954,397,136.25|-|-|4,954,397,136.25|
|Differences arising from business combination|13,894,283,352.95|-|583,183,507.54|13,311,099,845.41|
|involving enterprises under common control|||||
|Others(Note)|-|1,164,197,108.39|-|1,164,197,108.39|
|Other capital reserve|-2,781,133.00|-|-|-2,781,133.00|
|Including: Transfer from capital reserve under the previous|-2,781,133.00|-|-|-2,781,133.00|
|accounting system|||||
|Total|18,845,899,356.20|1,164,197,108.39|583,183,507.54|19,426,912,957.05|

 Note: It refers to the income generated by China Merchants Port Holdings in the disposal of the company's equity in June 2018.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued
44. Other comprehensive income
RMB
||||||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|||||Amount incurred in current period|||||||||||||
|||||||Less: Amount included|||||||||||
|||||Amount before||in other comprehensive||||After-tax income||After-tax income||The impact of|||
|Item||Opening balance||income tax||income in the prior||Less: Income tax||attributable to the||attributable to||business||Closing balance|
|||||incurred in||periods that is||expense||parent company||minority||combination under|||
|||||current year||transferred to profit or||||owner||shareholders||common control|||
|||||||loss for the period|||||||||||
|For the period from 1 January to 30 June 2019|||||||||||||||||
|I. Other comprehensive income that will not be|75,673,134.08||38,773,588.04||-||235,000.00||15,630,350.48||22,908,237.56||-||91,303,484.56||
|reclassified subsequently to profit or loss|||||||||||||||||
|Including: Change as a result of remeasurement of the|-||-||-||-||-||-||-||-||
|net defined benefit plan liability or asset|||||||||||||||||
|Share of other comprehensive income of the|-||37,833,588.04||-||-||14,925,350.48||22,908,237.56||-||14,925,350.48||
|investee under the equity method that will|||||||||||||||||
|not be reclassified to profit or loss|||||||||||||||||
|Changes in fair value of other equity|75,673,134.08||940,000.00||-||235,000.00||705,000.00||-||-||76,378,134.08||
|instruments|||||||||||||||||
|II. Other comprehensive income that will be reclassified|13,252,844.49||-954,554,782.61||-||-||-348,242,893.56||-606,311,889.05||-||-334,990,049.07||
|subsequently to profit or loss|||||||||||||||||
|Including: Share of other comprehensive income of the|100,000.00||-65,347,540.69||-||-||-25,779,604.80||-39,567,935.89||-||-25,679,604.80||
|investee under the equity method that will|||||||||||||||||
|be reclassified to profit or loss|||||||||||||||||
|Translation differences of financial|13,152,844.49||-889,207,241.92||-||-||-322,463,288.76||-566,743,953.16||-||-309,310,444.27||
|statements denominated in foreign currencies|||||||||||||||||
|Total|88,925,978.57||-915,781,194.57||-||235,000.00||-332,612,543.08||-583,403,651.49||-||-243,686,564.51||
|2018|||||||||||||||||
|I. Other comprehensive income that will not be|-742,874,052.89||-127,586,823.04||-||1,125,715.00||-48,671,312.79||-80,041,225.25||867,218,499.76||75,673,134.08||
|reclassified subsequently to profit or loss|||||||||||||||||
|Including: Change as a result of remeasurement of the|-||-20,136,880.35||-||-||-7,943,999.30||-12,192,881.05||7,943,999.30||-||
|net defined benefit plan liability or asset|||||||||||||||||
|Share of other comprehensive income of the|-||-116,954,783.85||-||-||-46,138,662.23||-70,816,121.62||46,138,662.23||-||
|investee under the equity method that will|||||||||||||||||
|not be reclassified to profit or loss|||||||||||||||||
|Changes in fair value of other equity|-742,874,052.89||9,504,841.16||-||1,125,715.00||5,411,348.74||2,967,777.42||813,135,838.23||75,673,134.08||
|instruments|||||||||||||||||
|II. Other comprehensive income that will be reclassified|13,252,844.49||333,315,323.72||-||-||90,449,399.81||242,865,923.91||-90,449,399.81||13,252,844.49||
|subsequently to profit or loss|||||||||||||||||
|Including: Share of other comprehensive income of the|100,000.00||-20,157,413.77||-||-||-7,952,099.73||-12,205,314.04||7,952,099.73||100,000.00||
|investee under the equity method that will|||||||||||||||||
|be reclassified to profit or loss|||||||||||||||||
|Total|-729,621,208.40||205,728,500.68||-||1,125,715.00||41,778,087.02||162,824,698.66||776,769,099.95||88,925,978.57||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 45. Special reserve
RMB
||||||
|-|-|-|-|-|
|Item|Opening balance|Increase|Decrease|Closing balance|
|For the period from 1 January to 30 June 2019：|||||
|Production safety reserve|8,231,080.43|66,424,472.16|54,201,356.20|20,454,196.39|
|2018:|||||
|Production safety reserve|4,767,373.45|24,165,961.75|20,702,254.77|8,231,080.43|

 46. Surplus reserve
RMB
||||||
|-|-|-|-|-|
|Item|Opening balance|Increase|Decrease|Closing balance|
|For the period from 1 January to 30 June 2019：|||||
|Statutory surplus reserve|527,175,908.67|-|-|527,175,908.67|
|2018:|||||
|Statutory surplus reserve|520,074,434.56|7,101,474.11|-|527,175,908.67|

Note：In accordance with the Company Law of the PRC and the Company's Articles of Association, the Company should appropriate10% of net profit for the year to the statutory surplus reserve, and the Company can cease appropriation when the statutory surplus reserve accumulates to more than50% of the registered capital. The statutory surplus reserve can be used to make up for the loss or increase the paid-in capital after approval.
The appropriation to discretionary surplus reserve is proposed by the board of directors and approved by the general meeting of shareholders. The discretionary surplus reserve can be used to make up for the loss of prior years or increase the paid-in capital after approval.
47. Unappropriated profit
RMB
||||
|-|-|-|
|||Proportion of|
|Item|Amount|appropriation or|
|||allocation|
|For the period from 1 January to 30 June 2019：|||
|Unappropriated profit at the end of prior period before adjustment|8,915,817,110.21||
|Adjustment of total unappropriated profit at the beginning of period|-37,858,457.43|Note 1|
|Unappropriated profit at the beginning of period after adjustment|8,877,958,652.78||
|Add: Net profit attributable to shareholders of the Company for the period|2,299,181,330.61||
|Less: Appropriation to statutory surplus reserve|-||
|Appropriation to discretionary surplus reserve|-||
|Appropriation to risk preparation|-||
|Ordinary shares' dividends payable|204,449,011.09|Note 2|
|Ordinary shares' dividends converted into share capital|-||
|Others|-||
|Unappropriated profit at the end of the period|10,972,690,972.30||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 47. Unappropriated profit - continued
RMB
||||
|-|-|-|
|||Proportion of|
|Item|Amount|appropriation or|
|||allocation|
|2018:|||
|Unappropriated profit at the end of prior year before adjustment|3,566,083,142.17||
|Adjustment of total unappropriated profit at the beginning of year|5,716,548,113.47|Note 1|
|Unappropriated profit at the beginning of year after adjustment|9,282,631,255.64||
|Add: Net profit attributable to shareholders of the Company for|1,090,418,910.77||
|the year|||
|Less: Appropriation to statutory surplus reserve|7,101,474.11||
|Appropriation to discretionary surplus reserve|-||
|Appropriation to risk preparation|-||
|Ordinary shares' dividends payable|850,443,359.86||
|Ordinary shares' dividends converted into share capital|-||
|Others|599,688,222.23||
|Unappropriated profit at the end of the year|8,915,817,110.21||

Note 1: Details of adjustment to total unappropriated profit at the beginning ofyear：
As Notes (III) 31, due to the impact of changes in accounting policies, the Group decreased the unappropriated profit at the beginning of the year by RMB 37,858,457.43. Due to the impact of changes in accounting policies of the prior year, the Group increased the unappropriated profit at the beginning of the year by RMB 816,323,338.17. Due to the impact of business combination under common control of the prior year, the unappropriated profit at the beginning of the previous year was RMB 4,900,224,775.30. Note 2: According to the resolution of the shareholders' meeting of 20 May 2019, the Company distributed cash dividends of RMB1.14 (tax inclusive) per 10 shares based on the total shares of 1,793,412,378 shares as of 31 December 2018, and the total amount of the cash dividends distributed was RMB 204,449,011.09.
48. Operating income and operating costs
RMB
|||||||||
|-|-|-|-|-|-|-|-|
|||Amount incurred||||Amount incurred||
|Item||in the current period||||in the previous period||
|||Income||Cost||Income|Cost|
|Principal operating|5,757,493,642.27||3,491,922,787.72||4,620,260,636.23|||
|Other operating|76,859,779.06||116,097,908.19||52,077,404.49|||
|Total|5,834,353,421.33||3,608,020,695.91||4,672,338,040.72|||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 49. Taxes and levies
RMB
||||
|-|-|-|
||Amount incurred in thecurrent period|Amount incurred in the|
|Item|||
|||previous period|
|Property tax|25,394,756.09|16,051,367.22|
|Land holding tax|16,894,999.35|5,335,484.17|
|City construction and maintenance tax|2,978,839.39|2,559,051.95|
|Stamp duty|2,444,903.78|949,691.82|
|Education surcharges|2,380,123.86|2,109,819.40|
|Others (Note)|46,381,888.95|56,035,824.99|
|Total|96,475,511.42|83,041,239.55|

 Note: Others including: 1. Program of Social Integration and Contribution for the financing of social security refer to the taxes based on the corporation's income, and the amount is BRL 11,607,842.82 (RMB 20,737,411.19); Tax on services is the one based on services provided, and the amount is BRL 11,324,566.31(RMB 20,231,337.70).
50. Administrative expenses
RMB
||||
|-|-|-|
||Amount incurred in the|Amount incurred in the|
|Item|||
||current period|previous period|
|Employee's salary|426,442,977.75|321,339,986.60|
|Depreciation expenses|37,107,071.34|18,575,612.09|
|Amortization of intangible assets|25,695,054.54|7,836,970.32|
|Fees paid to agencies|22,272,821.00|28,758,693.46|
|Others|135,726,793.73|120,909,475.76|
|Total|647,244,718.36|497,420,738.23|

 51. Financial expenses
RMB
||||
|-|-|-|
||Amount incurred in the|Amount incurred in the|
|Item|||
||current period|previous period|
|Interest expense|1,007,611,049.92|733,423,085.06|
|Less: Capitalized interest expenses|20,983,804.08|21,434,378.26|
|Less: Interest income|139,353,821.46|110,201,974.82|
|Exchange differences|-47,860,182.35|93,770,825.42|
|Handling fee|21,050,919.62|25,327,883.79|
|Others|1,317,410.77|3,176,703.34|
|Interest expense of lease liabilities|51,328,052.46||
|Total|873,109,624.88|724,062,144.53|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 52. Other income
RMB
|||||||
|-|-|-|-|-|-|
||||Amount incurred in||Related to assets /|
||Amount incurred inthe current period|||||
|Item|||the previous||related to|
||||period||income|
|Recognition of deferred income|20,048,198.10|3,535,989.39||Related to income||
|Steady growth funding project in 2018|13,850,262.00|-||Related to income||
|Sri Lanka Hambantota project subsidies|10,083,935.65|-||Related to income||
|VAT additional deduction|4,526,313.56|-||N/A||
|Key logistics enterprise loan interest financial subsidies|3,000,000.00|2,000,000.00||Related to income||
|Modern logistics funding project|2,923,380.55|1,500,000.00||Related to income||
|One-time award financing for key logistics companies|2,719,100.00|-||Related to income||
|Enterprise research and development funding scheme|2,349,000.00|2,689,000.00||Related to income||
|Supporting fund|2,000,000.00|-||Related to income||
|Modern logistics fundings|2,000,000.00|-||Related to income||
|Enterprise research and development subsidies|1,892,000.00|-||Related to income||
|Port construction subsidies|1,575,990.74|-||Related to income||
|Electricity subsidies|1,288,071.18|873,229.32||Related to income||
|Demonstration logistics park subsidies|1,000,000.00|-||Related to income||
|Tax refund|882,192.60|-||Related to income||
|Subsidies for purchase of TCP terminal project|-|7,264,707.34||Related to income||
|Port container and cargo throughput business improvement subsidies|-|5,499,631.00||Related to income||
|Special fund for the development of port and shipping|-|1,029,000.00||Related to income||
|Others|2,954,061.38|2,211,755.72||Related to income||
|Total|73,092,505.76|26,603,312.77||||

53. Investment income
(1) Details of investment income
RMB
||||
|-|-|-|
||Amount incurred in thecurrent period|Amount incurred in the|
|Item|||
|||previous period|
|Long-term equity investments income under equity method|1,795,952,978.08|1,497,601,956.62|
|Income from remeasurement of equity at fair value upon the|722,688,249.35||
|acquisition of control|||
|Investment income on other non-current financial assets|106,288,257.13|30,909,301.45|
|Investment income on other equity instruments|120,000.00|7,788,975.00|
|Total|2,625,049,484.56|1,536,300,233.07|

 There are no major restrictions on the remittance of the Group's investment income.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 53. Investment income - continued
(2) Details of long-term equity investments income under equity method
RMB
|||||
|-|-|-|-|
||Amount incurred in|Amount incurred in||
|Investee|||Reason for changes|
||the current period|the previous period||
|Shanghai International Port (Group) Co., Ltd.|1,164,668,288.63|894,357,860.58|Changes in net profit of investee|
|Terminal Link SAS|152,192,824.94|130,942,956.96|Changes in net profit of investee|
|Nanshan Group|98,769,988.95|44,518,621.17|Changes in net profit of investee|
|Qingdao Qianwan United Container Terminal|69,739,231.62|83,447,228.21|Changes in net profit of investee|
|Co., Ltd.||||
|Dalian Port Co., Ltd.|59,283,560.53|39,810,842.72|Changes in net profit of investee|
|Euro-Asia Oceangate, S.a` r.l.|43,143,162.57|57,555,304.11|Changes in net profit of investee|
|COHA (Laizhou)|21,889,138.83|26,216,000.00|Changes in net profit of investee|
|Others|186,266,782.01|220,753,142.87|Changes in net profit of investee|
|Total|1,795,952,978.08|1,497,601,956.62||

54. Gains(losses) on changes in fair value
RMB
||||||
|-|-|-|-|-|
|||Amount incurred in thecurrent period||Amount incurred in the|
||Item||||
|||||previous period|
||Other non-current financial assets|836,888,566.32|-420,579,095.15||
||Including: Financial assets measured at fair value throughprofit or loss|836,888,566.32|-420,579,095.15||
||other non-current liabilities|-193,261,253.31|-50,760,297.68||
|t|Including: Financial liabilities measured at fair valuehrough profit or loss|-193,261,253.31|-50,760,297.68||
||Total|643,627,313.01|-471,339,392.83||

 55. Impairment credit gain
RMB
||||||
|-|-|-|-|-|
|||Amount incurred in thecurrent period||Amount incurred in the|
||Item||||
|||||previous period|
|Ir|. Impairment of credit loss on notes receivable and accountseceivable|5,181,091.87|1,789,443.78||
|I|I. Impairment of credit loss on other receivables|2,406,993.51|-||
|I|II. Impairment of credit loss on long-term receivables|-931,598.61|-||
|I|V. Others|1,042,648.01|-||
|T|otal|7,699,134.78|1,789,443.78||

 56. Impairment gain of assets
RMB
|||||
|-|-|-|-|
||Amount incurred in thecurrent period||Amount incurred in the|
|Item||||
||||previous period|
|Gain from inventory depreciation|25,051.16|-||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 57. Gains (losses) on disposal of assets
RMB
|||||
|-|-|-|-|
|Item||Amount incurred inthe previous period|Amount recognized|
||Amount incurred in|Amount incurred in|as non-recurring gain|
||the current period|the previous period|and loss in the|
||||current period|
|Gains (losses) on disposal of non-current|4,169,857,166.53|10,478,881.99||
|assets||||
|Including: Gains (losses) on disposal of|-13,060.65|10,216,400.44||
|fixed assets||||
|Gains (losses) on disposal of|4,169,848,063.69|-||
|intangible assets||||
|Others|22,163.49|262,481.55||

 58. Non-operating income
RMB
|||||
|-|-|-|-|
||||Amount recognized as|
||Amount incurred in the|Amount incurred in the|non-recurring gain and|
|Item||||
||current period|previous period|loss in the current|
||||period|
|Compensation received for contracts|602,937.10|165,055.85|602,937.10|
|violation||||
|Government grants|313,000.00|-|313,000.00|
|Others|13,463,681.24|45,473,610.60|13,463,681.24|
|Total|14,379,618.34|45,638,666.45|14,379,618.34|

 59. Non-operating expenses
RMB
|||||
|-|-|-|-|
||||Amount recognized as|
||Amount incurred in the|Amount incurred in the|non-recurring gain and|
|Item||||
||current period|previous period|loss in the current|
||||period|
|Donation|2,639,889.06|420,076.21|2,639,889.06|
|Losses on retirement of non-current assets|2,315,206.28|296,167.91|2,315,206.28|
|Compensation, liquidated damages and|1,604,926.12|7,274,662.07|1,604,926.12|
|penalties||||
|Others|946,352.83|14,993,430.13|946,352.83|
|Total|7,506,374.29|22,984,336.32|7,506,374.29|

 60. Income tax expenses
RMB
||||
|-|-|-|
||Amount incurred in the|Amount incurred in the|
|Item|||
||current period|previous period|
|Current tax expenses|1,523,523,436.98|271,147,725.94|
|Deferred income tax|494,447,313.18|105,352,295.33|
|Total|2,017,970,750.16|376,500,021.27|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 60. Income tax expenses - continued
Reconciliation of income tax expenses to the accounting profit is as follows:
RMB
|||
|-|-|
|Item|Amount incurred in the current period|
|Accounting profit|8,075,707,935.32|
|Income tax expenses calculated at 25%|2,018,926,983.83|
|Effect of non-deductible expenses and losses|117,647,473.66|
|Accrued income tax expenses|657,244,370.87|
|Effect of previous deductible losses and deductible temporary differences unrecognized|39,339,828.74|
|as deferred tax assets||
|Effect of tax-free income (Note)|-156,476,495.56|
|Effect of tax preference policy|-144,760,553.89|
|Effect of different tax rates of subsidiaries operating in other jurisdictions|-447,524,358.37|
|Effect of recognition of deductible losses of previously-unrecognized deferred tax assets|-40,181,883.80|
|Effect of adjustments to previous year income tax|-29,685,778.94|
|Tax adjustments result in changes in the opening deferred tax assets / liabilities balance|598,149.64|
|Effect of unrecognized taxable temporary difference for tax purposes|1,292.26|
|Others|2,841,721.72|
|Income tax expenses|2,017,970,750.16|

Note： Effect of tax-free income is mainly effect on income tax on gain of investments in joint venture and associates.
61. Assets with restricted ownership or usage right
RMB
||||||
|-|-|-|-|-|
|Item||Closing balance||Opening balance|
|Cash and bank balances (Note 1)|1,418,706,200.00||1,697,027,200.00||
|Fixed assets (Note 2)|303,210,500.64||5,825,207,339.57||
|Equity of Colombo International Container Terminals Limited|1,593,911,174.89||1,526,241,901.61||
|(Note 3)|||||
|Equity of Thesar Maritime Limited (Note 3)|782,192,829.96||767,331,789.70||
|Intangible assets (Note 2)|159,708,329.63||161,408,030.71||
|Construction in process (Note 2)|55,898,342.90||43,352,104.93||
|Total|4,313,627,378.02||10,020,568,366.52||

 Note 1: See Notes (V) 1 for the information about restrict cash.
Note 2: Guangdong Yide Port Co. Ltd. acquired mortgage loans by pledged land with property right, fixed assets and construction in process. Refer to notes (V) 34 for details. As at 30 June 2019 and 31 December 2018, the book value of the mortgaged land use right of Guangdong Yide Port Co. Ltd. was RMB 159,708,329.63 and RMB161,408,030.71 respectively, the book value of the mortgaged fixed assets of it was RMB302,776,668.25 and RMB307,836,672.27 respectively, and the book value of the mortgaged construction in progress of it was RMB55,898,342.90 and RMB43,352,104.93 respectively. On 30 June 2019, TCP purchased
fixed assets by way of a mortgage, and the book value of the fixed assets is RMB 433,832.39.
Note 3: See notes (V) 34 for the information about the equity and equity pledge.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 62. Other comprehensive income
See notes (V) 44 for details.
63. Notes to items in cash flow statement
(1) Operating cash inflow
RMB
||||
|-|-|-|
||Amount incurred in the|Amount incurred in the|
|Item|||
||current period|previous period|
|Government grants|342,134,131.96|15,634,266.76|
|Interest income|111,184,074.51|75,812,811.08|
|Guarantees and deposits|17,708,608.61|16,104,892.66|
|Rentals|6,130,365.04|5,852,430.10|
|Insurance compensation received|1,584,445.49|1,371,337.33|
|Refunds of harbor construction fee|21,352.76|46,618,144.04|
|Others|149,564,683.66|199,076,407.21|
|Total|628,327,662.03|360,470,289.18|

 (2) Operating cash outflow
RMB
||||
|-|-|-|
||Amount incurred in the|Amount incurred in the|
|Item|||
||current period|previous period|
|Advance payment|128,526,655.26|21,608,850.17|
|Administration expense and other operating expenses|82,273,477.12|72,033,537.59|
|Rentals|26,768,612.20|8,813,209.74|
|Berth dredging fee|19,810,544.00|63,477,153.25|
|Port expenses|10,694,022.45|19,109,078.94|
|Guarantees and deposits|11,844,446.05|15,940,856.60|
|Port construction fee|6,612,997.74|48,772,952.00|
|Cargo fee|1,647,007.40|35,171.23|
|Others|89,782,545.95|143,104,607.61|
|Total|377,960,308.17|392,895,417.13|

 (3) Investment cash inflow
RMB
||||
|-|-|-|
||Amount incurred in the|Amount incurred in the|
|Item|||
||current period|previous period|
|Cash borrowings repayment received|1,017,690,000.00|1,000,000.00|
|Principle received from structured deposit that cannot be|775,000,000.00|-|
|withdrawn on demand|||
|Cash received from acquisition of subsidiaries|841,029,533.97|-|
|Interests received from structured deposit|8,023,808.23|-|
|Others|4,000.00|-|
|Total|2,641,747,342.20|1,000,000.00|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 63. Notes to items in cash flow statement - continued
(4) Net cash payments for acquisition of subsidiaries and other business entities
RMB
|||
|-|-|
||Amount incurred in the|
|Item||
||current period|
|Cash or cash equivalents paid in current year for business combination incurred in|375,334,390.00|
|current year||
|Including: Zhanjiang Port (Group) Co., Ltd.|375,334,390.00|
|Less: Cash and cash equivalents held by subsidiaries at the date of purchase|1,216,363,923.97|
|Including: Zhanjiang Port (Group) Co., Ltd.|1,216,363,923.97|
|Net cash payment to acquire subsidiary|-841,029,533.97|

 (5) Investment cash outflow
RMB
||||
|-|-|-|
||Amount incurred in the|Amount incurred in the|
|Item|||
||current period|previous period|
|Structured cash deposit that cannot be withdrawn on|495,000,000.00|-|
|demand|||
|Payment of creditor's rights transfer|356,137,574.00|-|
|Lend out|54,390,000.00|-|
|Supplementary payment of taxes and fees for material|51,269,104.33|-|
|assets reorganization|||
|Income tax expenses on disposal of equity of Ningbo Port|-|25,463,391.23|
|Others|17,106,451.45|-|
|Total|973,903,129.78|25,463,391.23|

 (6) Financing cash inflow
RMB
||||
|-|-|-|
||Amount incurred in the|Amount incurred in the|
|Item|||
||current period|previous period|
|China Merchants Port Holdings Co., Ltd. disposes stock|-|4,422,370,076.87|
|equity of the Company|||

(7) Financing cash outflow
RMB
||||
|-|-|-|
||Amount incurred in the|Amount incurred in the|
|Item|||
||current period|previous period|
|Payment for lease|170,160,928.54|22,232,883.90|
|Out-of-pocket for channel maintenance fee|32,050,913.34|-|
|Repayment to stock holders|-|1,502,706.40|
|Debt issue costs|-|12,873,823.10|
|Others|13,779,138.79|7,043.02|
|Total|215,990,980.67|36,616,456.42|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 64. Supplementary information to the cash flow statement
(1) Supplementary information to the cash flow statement
RMB
||||
|-|-|-|
||Amount incurred in the|Amount incurred in the|
|Supplementary information|||
||current period|previous period|
|1. Reconciliation of net profit to cash flows from operating activities:|||
|Net profit|6,057,737,185.16|1,455,275,672.05|
|Add: Provision for impairment losses of assets|-25,051.16|-|
|Impairment of credit loss|-7,699,134.78|-1,789,443.78|
|Depreciation of fixed assets|817,471,364.36|687,007,055.11|
|Depreciation of investment property|95,124,919.10|86,371,256.30|
|Depreciation of right-of-use assets|152,337,348.71||
|Amortization of intangible assets|318,766,288.91|225,847,011.97|
|Amortization of long-term prepaid expenses|9,815,827.73|9,221,631.83|
|Losses (Gains) on disposal of fixed assets , intangible assets and other|-4,169,857,166.53|-10,478,881.99|
|long-term assets|||
|Losses on retirement of fixed assets , intangible assets and other long-|2,315,206.28|235,544.05|
|term assets|||
|Losses on changes in fair value|-643,627,313.01|471,339,392.83|
|Financial expenses|990,095,115.95|805,759,532.22|
|Losses (Gains) arising from investments|-2,625,049,484.56|-1,536,300,233.07|
|Decrease (Increase) in deferred tax assets|-7,751,337.66|-8,112,001.02|
|Increase in deferred tax liabilities|502,198,650.84|113,464,296.34|
|Decrease in inventories|-25,705,795.78|-8,572,016.07|
|Decrease (Increase) in operating receivables|-221,499,911.06|-515,968,675.31|
|Increase (Decrease) in operating payables|1,312,215,203.02|27,434,577.25|
|Net cash flows from operating activities|2,556,861,915.52|1,800,734,718.71|
|2．Significant investing and financing activities that do not involve cash|||
|receipts and payments:|||
|Conversion of debt into capital|-|-|
|Convertible bonds due within one year|-|-|
|Fixed assets acquired under finance leases|-|-|
|3．Net changes in cash and cash equivalents:|||
|Closing balance of cash|5,618,184,649.19|7,661,561,715.98|
|Less: Opening balance of cash|5,373,281,504.75|7,729,460,082.75|
|Add: Closing balance of cash equivalents|-|-|
|Less: Opening balance of cash equivalents|-|-|
|Net increase (Decrease) in cash and cash equivalents|244,903,144.44|-67,898,366.77|

 (2) Composition of cash and cash equivalents
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|I. Cash|5,618,184,649.19|5,373,281,504.75|
|Including: Cash on hand|462,266.71|349,650.07|
|Bank deposits|5,166,976,023.14|5,116,481,444.13|
|Other monetary funds|450,746,359.34|256,450,410.55|
|II. Cash equivalents|-|-|
|III. Closing balance of cash and cash equivalents|5,618,184,649.19|5,373,281,504.75|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
V NOTES TO ITEMS IN THE CONSOLIDATED FINANCIAL STATEMENTS - continued 65. Foreign currency monetary items
||||||||
|-|-|-|-|-|-|-|
|||Closing balance in||||Closing amount in|
|Item||||Exchange rate|||
|||foreign currency||||RMB|
|Cash and bank balances|||||1,901,107,398.04||
|Including: HKD|130,302,290.52||0.8797||114,626,924.97||
|USD|174,964,244.05||6.8747||1,202,826,688.57||
|EUR|54,644,095.87||7.8170||427,152,897.42||
|RMB|156,500,887.08||1.0000||156,500,887.08||
|Accounts receivable|||||189,996,558.75||
|Including: HKD|55,081,872.29||0.8797||48,455,523.05||
|USD|5,657,079.04||6.8747||38,890,721.28||
|EUR|13,131,676.40||7.8170||102,650,314.42||
|Other receivables|||||1,618,633,171.70||
|Including: HKD|30,216,993.64||0.8797||26,581,889.30||
|USD|12,650,786.86||6.8747||86,970,364.43||
|EUR|29,888,753.16||7.8170||233,640,383.45||
|RMB|1,271,440,534.52||1.0000||1,271,440,534.52||
|Short-term borrowings|||||1,353,835,000.00||
|Including: HKD|550,000,000.00||0.8797||483,835,000.00||
|RMB|870,000,000.00||1.0000||870,000,000.00||
|Accounts payables|||||46,851,418.24||
|Including: HKD|3,894,099.30||0.8797||3,425,639.15||
|USD|42,231.04||6.8747||290,325.73||
|EUR|5,518,159.57||7.8170||43,135,453.36||
|Other payables|||||536,615,622.71||
|Including: HKD|42,624,300.74||0.8797||37,496,597.36||
|USD|46,709,694.98||6.8747||321,115,140.08||
|RMB|27,054,927.71||1.0000||27,054,927.71||
|EUR|19,310,343.81||7.8170||150,948,957.56||
|Non-current liabilities due within one year|||||239,200,200.00||
|EUR|30,600,000.00||7.8170||239,200,200.00||
|Long-term borrowings|||||1,793,770,925.00||
|USD|100,000,000.00||6.8747||687,470,000.00||
|EUR|141,525,000.00||7.8170||1,106,300,925.00||
|Bonds payable|||||20,927,597,972.79||
|USD|2,680,494,854.00||6.8747||18,427,597,972.79||
|RMB|2,500,000,000.00||1.0000||2,500,000,000.00||
|Long-term payables|||||422,118,000.00||
|EUR|54,000,000.00||7.8170||422,118,000.00||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
VI CHANGES IN SCOPE OF CONSOLIDATION
1. Business combination involving enterprises not under common control
(1) Business combination involving enterprises not under common control
RMB
|||||||||||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
||||||c|Proportion of|)||||||||||Revenue from th|e|c|Net profit from|fee|
||||||||||||||da|Basis for|ee|||||||
|Name of||||||equity acquired|||Acquisitio|n|||||||beginning of the|||the beginning o||
|||Acquisition Date||Acquisition Cost||||||||Purchase Date||etermining th||||||||
|acquiree||||||by business|||Method||||||||period to the|||the period to th||
|||||||||||||||cquisition dat||||||||
|||||||ombination (%|||||||||||combination date|||ombination dat||
|Zhanjiang|3 February 2019||6,092,234,949.52||58.3549|||CashPayment|||3 February 2019||Transfer ofcontrol|||1,052,293,232.02|||34,130,773.98|||
|Port (Group)||||||||||||||||||||||
|Co., Ltd.||||||||||||||||||||||

Note: On 31 December 2018, China Merchants International Terminals (Zhanjiang) Limited, a subsidiary of the Group, obtained 1,809,310,930 shares of A common stock shares of the Zhanjiang Port (Group) Co., Ltd. (hereinafter referred to as "Zhanjiang Port"),
representing approximately40.2916% of the total issued shares of the Zhanjiang Port. On 2 January 2019, the Group signed the Share Transfer Agreement on Zhanjiang Port (Group) Co., Ltd. with Guangdong Sinotrans Co., Ltd., which stipulated to transfer the ordinary shares of 201,034,548 of Zhanjiang Port held by Guangdong Sinotrans Co., Ltd. to the Group which take account5% of the total shares issued by Zhanjiang Port at the agreement signing date at the consideration of RMB 375,334,390.00.
As at 8 January 2019, Chiwan Wharf Holdings (Hong Kong) Limited (hereinafter referred to as "Wharf Hong Kong"), a subsidiary of the Group, signed the Capital Increase Agreement of Zhejiang Port (Group) Co., Ltd. (hereinafter referred to as "Capital Increase Agreement") with Zhanjiang Infrastructure Construction Investment Group Co., Ltd. (hereinafter referred to as "Zhanjiang Infrastructure Investment") and Zhanjiang Port in Zhanjiang, according to which Zhanjiang Port intended to issue 1,853,518,190 ordinary shares at a price of RMB 1.867 per share or equivalent foreign currency (determined by the capital exchange rate) to increase its registered capital to RMB 5,874,209,145.00. Among them, Wharf Hong Kong intended to subscribe for 1,606,855,919 ordinary shares, accounting for27.3544% of the issued shares of Zhanjiang Port on the date of issue of the subscription shares, and the total amount paid is RMB 3,000,000,000.77 or the equivalent foreign currency (determined by the capital contribution rate) (hereinafter referred to as "the transaction"). Zhanjiang Infrastructure Investment intended to subscribe for 246,662,271 ordinary shares, accounting for4.1991% of the issued shares of Zhanjiang Port on the date of issue of the subscription shares, and the total amount paid is RMB 460,518,459.96.
The above transactions were completed on 3 February 2019, from which date the Group held the ordinary shares of 3,427,890,467 which were accounting for58.3549% of the issued shares of Zhanjiang Port. The group was able to control the Zhanjiang Port and enjoy the variable rewards through participating in its relevant activities. Therefore, Zhanjiang Port is included in the consolidation scope of the financial statements by the Group.
(2) Acquisition cost and goodwill
RMB
||||
|-|-|-|
|Acquisition cost||Zhanjiang Port (Group) Co., Ltd.|
|Consideration|6,092,234,949.52||
|Less: Fair value per share of acquired net identifiable assets|5,619,831,623.39||
|Goodwill|472,403,326.13||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
VI CHANGES IN SCOPE OF CONSOLIDATION - continued
1. Business combination involving enterprises not under common control - continued (3) Carrying amount of the acquiree's assets and liabilities on the combination date
RMB
||||||
|-|-|-|-|-|
|||Zhanjiang Port (Group) Co., Ltd.|||
|||Fair Value on||Book Value on|
|||Combination Date||Combination Date|
|Assets:|||||
|Current Assets|5,150,281,558.06||5,150,281,558.06||
|Other non-current financial assets|15,243,577.73||15,243,577.73||
|Long-term receivables|877,208,613.40||877,208,613.40||
|Long-term equity investment|172,685,776.52||165,494,758.03||
|Investment property|63,473,360.24||39,760,964.41||
|Fixed Assets|8,445,573,407.27||7,451,556,053.74||
|Right-of-use assets|1,303,743,708.78||1,303,743,708.78||
|Construction in progress|1,172,652,644.17||1,172,652,644.17||
|Intangible assets|3,566,911,864.41||2,211,115,469.85||
|Development expenditure|14,968,306.82||14,968,306.82||
|Goodwill|-||9,775,569.57||
|Long-term deferred expenses|2,630,870.77||2,630,870.77||
|Deferred tax assets|41,821,411.69||41,821,411.69||
|Other non-current assets|876,528,510.11||876,528,510.11||
|Liabilities:|||||
|Current liabilities|6,038,356,153.82||6,038,356,153.82||
|Long-term borrowings|1,762,537,800.00||1,762,537,800.00||
|Bonds payable|400,000,000.00||400,000,000.00||
|Deferred income|964,428,470.34||964,428,470.34||
|Long-term employee benefit payable|317,640,000.00||317,640,000.00||
|Deferred tax liabilities|595,179,290.60||-||
|Lease liabilities|857,876,749.08||857,876,749.08||
|Other non-current liabilities|36,084,447.60||36,084,447.60||
|Net assets|10,731,620,698.53||8,955,858,396.29||
|Less: Minority interests|5,111,789,075.14||4,294,854,457.00||
|Net assets acquired|5,619,831,623.39||4,661,003,939.29||

 (4) Revenue and net cash flows from the beginning of the period to the combination date RMB
||||
|-|-|-|
|||the beginning of the period to the combination date|
|Operating income|1,052,293,232.02||
|Operating costs and expense|721,311,974.59||
|Gross profit|812,695.40||
|Net profit|34,130,773.98||
|Net Cash Flows from Operating Activities|347,048,963.31||
|Net Cash Flows from Investing Activities|367,847,906.27||
|Net Cash Flows from Financing Activities|-465,048,225.31||
|Net Increase (Decrease) in Cash and Cash Equivalents|249,848,644.27||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
VII EQUITY IN OTHER ENTITIES
1. Interests in subsidiaries
(1) Composition of the Group
|||||||||
|-|-|-|-|-|-|-|-|
|Full name of the subsidiary|Principal place of|Place of|Nature of business||Proportion of ownership||Proportion of ownership Interest|
|||||Registered Capital (in tenthousand Yuan unless|Interest (%)Direct Direct|||
||business|incorporation||otherwise stated)|ownershipinterest|ownershipinterest|(%)|
|Shenzhen Chiwan International Freight Agency Co., Ltd.|Shenzhen, PRC|Shenzhen, PRC|Logistics supportservices|550.00|100.00|-|Established through investment|
|Chiwan Wharf Holdings (Hong Kong) Limited.|Hong Kong SAR,PRC|Hong KongSAR, PRC|Investment|HKD 1,000,000.00|100.00|-|Established through investment|
|Dongguan Chiwan Wharf Co., Ltd. ("DGW")|Dongguan, PRC|Dongguan, PRC|Logistics supportservices|45,000.00|85.00|-|Established through investment|
|DGT.|Dongguan, PRC|Dongguan, PRC|Logistics supportservices|40,000.00|100.00|-|Established through investment|
|Hinwin Development Limited|Hong Kong SAR,PRC|Hong KongSAR, PRC|Investment|HKD 10,000.00|100.00|-|Established through investment|
|CHCC|Shenzhen, PRC|Shenzhen, PRC|Logistics supportservices|28,820.00|100.00|-|Combination involving enterprisesunder common control|
|Shenzhen Chiwan Port Development Co., Ltd.|Shenzhen, PRC|Shenzhen, PRC|Logistics supportservices|1,500.00|100.00|-|Combination involving enterprisesunder common control|
|CCT|Shenzhen, PRC|Shenzhen, PRC|Logistics supportservices|USD 95,300,000.00|55.00|20.00|Combination involving enterprisesunder common control|
|Shenzhen Chiwan Tugboat Co., Ltd.|Shenzhen, PRC|Shenzhen, PRC|Logistics supportservices|2,400.00|100.00|-|Combination involving enterprisesunder common control|
|Chiwan Shipping (Hong Kong) Limited|Hong Kong SAR,PRC|Hong KongSAR, PRC|Logistics supportservices|HKD 800,000.00|100.00|-|Combination involving enterprisesunder common control|
|China Merchants Port Holdings (Note 1)|Hong Kong SAR,PRC|Hong KongSAR, PRC|Investment|HKD39,070.13million|39.45|-|Combination involving enterprisesunder common control|
|CMBL.|Shenzhen, PRC|Shenzhen, PRC|Logistics supportservices|70,000.00|40.00|60.00|Combination involving enterprisesunder common control|
|China Merchants International Information Technology|Shenzhen, PRC|Shenzhen, PRC|InformationTechnology|5,000.00|23.16|76.84|Combination involving enterprisesunder common control|
|Co., Ltd.||||||||
|China Merchants International (China) Investment Co.,|Shenzhen, PRC|Shenzhen, PRC|Investment|USD 30,000,000.00|-|100.00|Combination involving enterprisesunder common control|
|Ltd.||||||||
||Qingdao PRC|Qingdao PRC|Logistics supportservices|USD 206.30 million|-|100.00|Combination involving enterprisesunder common control|
|CMT||||||||
||Hong Kong SAR,PRC|Hong KongSAR, PRC|Logistics supportservices|HKD 500,000.00|-|100.00|Combination involving enterprisesunder common control|
|CMCS||||||||
||Shenzhen, PRC|Shenzhen, PRC|Logistics supportservices|55,000.00|-|100.00|Combination involving enterprisesunder common control|
|China Merchants Port (Shenzhen) Co., Ltd.||||||||
||Shenzhen, PRC|Shenzhen, PRC|Engineeringsupervision|300.00|-|100.00|Combination involving enterprisesunder common control|
|SZHQ.||||||||
|ATJ|Shenzhen, PRC|Shenzhen, PRC|Storage|HKD 100.00 million|-|100.00|Combination involving enterprisesunder common control|
|ASJ|Shenzhen, PRC|Shenzhen, PRC|Storage|HKD 100.00 million|-|100.00|Combination involving enterprisesunder common control|
|China Merchants International Terminal (Qingdao) Co.,|Qingdao PRC|Qingdao PRC|Logistics supportservices|USD 44.00 million|-|90.10|Combination involving enterprisesunder common control|
|Ltd.||||||||
|Colombo International Container Terminals Limited|Sri Lanka|Sri Lanka|Logistics supportservices|USD 150.00 million|-|85.00|Combination involving enterprisesunder common control|
|SMPS|Shenzhen, PRC|Shenzhen, PRC|Logistics supportservices|20,000.00|-|100.00|Combination involving enterprisesunder common control|
|SMTC|Shenzhen, PRC|Shenzhen, PRC|Logistics supportservices|33,500.00|-|100.00|Combination involving enterprisesunder common control|
|SMWC|Shenzhen, PRC|Shenzhen, PRC|Logistics supportservices|20,000.00|-|100.00|Combination involving enterprisesunder common control|
|Zhangzhou China Merchants Tugboat Co Ltd.|Zhangzhou, PRC|Zhangzhou,PRC|Logistics supportservices|1,500.00|-|70.00|Combination involving enterprisesunder common control|
|Zhangzhou China Merchants Port Co Ltd.|Zhangzhou, PRC|Zhangzhou,PRC|Logistics supportservices|100,000.00|-|60.00|Combination involving enterprisesunder common control|
|ZCMG(Note2)|Zhangzhou, PRC|Zhangzhou,PRC|Logistics supportservices|44,450.00|-|31.00|Combination involving enterprisesunder common control|
|China Merchants (SCT) Holdings Company Limited|Shenzhen, PRC|Shenzhen, PRC|Logistics supportservices|HKD 618.20 million|-|80.00|Combination involving enterprisesunder common control|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
VII EQUITY IN OTHER ENTITIES - continued
1. Interests in subsidiaries - continued
(1) Composition of the Group - continued
|||||||||
|-|-|-|-|-|-|-|-|
||Principal place of|Place of||Registered Capital (in ten|Proportion of ownershipInterest (%)||Proportion of ownership Interest|
|Full name of the subsidiary|business|incorporation|Nature of business|thousand Yuan unlessotherwise stated)|Directownershipinterest|Directownershipinterest|(%)|
||Shenzhen, PRC|Shenzhen, PRC|Logistics supportservices|60,854.90|-|80.00|Combination involving enterprisesunder common control|
|Shekou Container Terminals (Phase II) Co., Ltd.||||||||
||Shenzhen, PRC|Shenzhen, PRC|Logistics supportservices|127,600.00|-|80.00|Combination involving enterprisesunder common control|
|SCT3||||||||
||Shenzhen, PRC|Shenzhen, PRC|Storage|6,060.00|-|80.00|Combination involving enterprisesunder common control|
|AYJ||||||||
||Shenzhen, PRC|Shenzhen, PRC|Logistics supportservices|53,072.92|-|67.00|Combination involving enterprisesunder common control|
|Shenzhen Haixing Port Development Co., Ltd.||||||||
|Shenzhen Lianyongtong Dock Co., Ltd.|Shenzhen, PRC|Shenzhen, PRC|Logistics supportservices|USD 7 million|-|100.00|Combination involving enterprisesunder common control|
|YDG|Foshan, PRC|Foshan, PRC|Logistics supportservices|21,600.00|-|51.00|Combination involving enterprisesunder common control|
|Mega Shekou Container Terminals Limited|British VirginIslands|British VirginIslands|Investment|USD 120.00|-|85.42|Combination involving enterprisesunder common control|
|Thesar Maritime Limited|Cyprus|Cyprus|Investment|EUR 5,000.00|-|50.00|Combination involving enterprisesunder common control|
|Lomé Container Terminal S. A. (Note3)|Togolese Republic|TogoleseRepublic|Logistics supportservices|FCFA 200.00 million|-|35.00|Combination involving enterprisesunder common control|
|HIPG|Sri Lanka|Sri Lanka|Logistics supportservices|USD 794.00 million|-|85.00|Combination involving enterprisesunder common control|
|Shantou CMPort Group Co., Ltd.|Shantou, PRC|Shantou, PRC|Logistics supportservices|12,500.00|-|60.00|Combination involving enterprisesunder common control|
|JYRT|Shenzhen, PRC|Shenzhen, PRC|Property rentalservices|80,000.00|-|100.00|Combination involving enterprisesunder common control|
|QHW|Shenzhen, PRC|Shenzhen, PRC|Property rentalservices|20,000.00|-|100.00|Combination involving enterprisesunder common control|
|JZZ|Shenzhen, PRC|Shenzhen, PRC|InvestmentConsulting|4,000|-|75.00|Combination involving enterprisesunder common control|
|Shenzhen Lianda Tugboat Co., Ltd.|Shenzhen, PRC|Shenzhen, PRC|Logistics supportservices|200|-|60.29|Combination involving enterprisesunder common control|
|Zhangzhou Zhongli Outer Wheel Tally Co., Ltd|Zhangzhou, PRC|Zhangzhou,PRC|Logistics supportservices|200|-|84.00|Combination involving enterprisesunder common control|
|China Merchants Holdings (Djibouti) FZE|Djibouti|Djibouti|Logistics supportservices|USD 38.14 million|-|100.00|Combination involving enterprisesunder common control|
|TCP|Brazil|Brazil|Logistics supportservices|BRL 68.85 million|-|90.00|Combination involving enterprisesnot under common control|
|China Merchants Port (Zhoushan) RoRo Logistics Co.,|Zhoushan, PRC|Zhoushan, PRC|Logistics supportservices|17,307.86|51.00|-|Assets Acquisition|
|Ltd.||||||||
|China Merchants Port (Zhoushan) RoRo Terminal Co.,|Zhoushan, PRC|Zhoushan, PRC|Logistics supportservices|5,000.00|-|51.00|Assets Acquisition|
|Ltd.||||||||
|Shenzhen Haixing Xiaoyetian Logistics Development|Shenzhen, PRC|Shenzhen, PRC|Logistics supportservices|7,066.79|-|79.57|Assets Acquisition|
|Co., Ltd.||||||||
||Zhanjiang, PRC|Zhanjiang, PRC|Logistics supportservices|587,420.91|3.42|54.93|Combination involving enterprisesnot under common control|
|Zhanjiang Port (Group) Co., Ltd. (Note4)||||||||
|Zhanjiang Port International Container Terminal Co.,|Zhanjiang, PRC|Zhanjiang, PRC|Logistics supportservices|60,000.00|-|80.00|Com nb oi tn uat ni do en i cn ov mol mvi on ng ce on nte trr op lr isesr|
|Ltd.||||||||
|Zhanjiang Port Petrochemical Terminal Co., Ltd.|Zhanjiang, PRC|Zhanjiang, PRC|Logistics supportservices|18,000.00|-|50.00|Com nb oi tn uat ni do en i cn ov mol mvi on ng ce on nte trr op lr isesr|
|Zhanjiang Zhongli Foreign Goods Shipping Co., Ltd.|Zhanjiang, PRC|Zhanjiang, PRC|Logistics supportservices|300.00|-|84.00|Com nb oi tn uat ni do en i cn ov mol mvi on ng ce on nte trr op lr isesr|
|Zhanjiang Port East Island Bulk Cargo Terminal Co.,|Zhanjiang, PRC|Zhanjiang, PRC|Logistics supportservices|5,000.00|-|100.00|Com nb oi tn uat ni do en i cn ov mol mvi on ng ce on nte trr op lr isesr|
|Ltd.||||||||
|Guangdong Zhanjiang Port Bonded Service Co., Ltd.|Zhanjiang, PRC|Zhanjiang, PRC|Logistics supportservices|300.00|-|100.00|Com nb oi tn uat ni do en i cn ov mol mvi on ng ce on nte trr op lr isesr|
|Guangdong Zhanjiang Port Logistics Co., Ltd.|Zhanjiang, PRC|Zhanjiang, PRC|Logistics supportservices|10,000.00|-|100.00|Com nb oi tn uat ni do en i cn ov mol mvi on ng ce on nte trr op lr isesr|
|Zhanjiang Port Haichuan Trading Co., Ltd.|Zhanjiang, PRC|Zhanjiang, PRC|Logistics supportservices|200.00|-|100.00|Com nb oi tn uat ni do en i cn ov mol mvi on ng ce on nte trr op lr isesr|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
VII EQUITY IN OTHER ENTITIES - continued
1. Interests in subsidiaries - continued
(1) Composition of the Group - continued
Note 1: On 19 June 2018, the Company and CMHK signed the Concerted Action Agreement on China Merchants Port Holdings Co., Ltd., according to which, in respect of the voting rights of22.64% of China Merchants Port Holdings Co., Ltd. entrusted to exercise, CMHK shall comply unconditionally with the votes of the Company and vote based on them in terms of the issues to be voted at the meetings of shareholders of China Merchants Port Holdings Co., Ltd. Therefore, the Company holds62.09% of the voting rights of China Merchants Port Holdings Co., Ltd. and is able control it.
Note 2: The Group and China Merchants Zhangzhou Development Zone Co., Ltd. signed the "Equity Custody Agreement". China Merchants Zhangzhou Development Zone Co., Ltd. entrusted29% of its equity in ZCMG to the Group's operations and management. Therefore, the Group's voting rights to ZCMG is60%, which included in the
consolidation scope of the Group.
Note 3: The Group has the right to appoint the majority of Executive Committee members ofLomé Container Terminal S.A., so the Group has included the company in the consolidated financial statements.
Note 4: See notes (VI).
(2) Material non-wholly-owned subsidiaries
RMB
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
||||Proportion of|||||||
||||||Profit or loss||Payments for|||
||||ownership interest|||||||
||||||attributable to minority||dividends to minority||Closing balance of|
|Name of the subsidiary|||held by the|||||||
||||||shareholders at the end||shareholders in the||minority interest|
||||minority|||||||
||||||of the period||current period|||
||||shareholders (%)|||||||
|China Merchants Port Holdings Co., Ltd|.|60.55||3,302,308,869.07||1,273,144,583.25||51,415,616,325.99||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
VII EQUITY IN OTHER ENTITIES - continued
1. Interests in subsidiaries - continued
(3) Significant financial information of material non-wholly-owned subsidiaries
RMB
||||||||||||||||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|Name of the|||Closing balance||||||||||||Opening balance||||||||||||
||subsidiary||Current assets||Non-current assets||Total assets||Current||Non-current||Total liabilities||Current assets||Non-current asset|s||Total assets||Current liabilities||Non-current||Total liabilities|
||||||||||liabilities||liabilities|||||||||||||liabilities|||
||China Merchants|16,272,404,476.40||111,347,770,614.05||127,620,175,090.45||11,654,526,639.23||38,342,114,885.68||49,996,641,524.91||9,453,546,575.26||110,694,125,429.95|||120,147,672,005.21||8,017,825,679.49||37,213,240,669.92||45,231,066,349.41||
||Port Holdings||||||||||||||||||||||||||
||Co., Ltd.||||||||||||||||||||||||||

RMB
||||||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|||Amount incurred in the current period||||||||Amount incurred in the previous period|||||||
|Name of the|||||||||||||||||
|||||||Total comprehensive||||||||Total comprehensive|||
|subsidiary||Operating income||Net profit||||Operating cash flows||Operating income||Net profit||||Operating cash flows|
|||||||income||||||||income|||
|China Merchants|3,861,739,507.52||5,309,663,495.61||4,363,679,239.08||1,910,841,306.56||3,677,787,796.61||1,248,814,883.04||887,912,741.88||1,690,631,294.24||
|Port Holdings|||||||||||||||||
|Co., Ltd.|||||||||||||||||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
VII. EQUITY IN OTHER ENTITIES - continued
2. Interests in joint ventures and associates
(1) Material joint ventures or associates
RMB
||||||||
|-|-|-|-|-|-|-|
|||||Proportion of ownership interests held by||Accounting method of|
||Principal place of|Place of|||||
|Investee|||Nature of business|the Group (%)||investments in joint|
||business|incorporation||Directly|Indirectly|ventures and associates|
|Associates|||||||
||Shanghai, PRC|Shanghai, PRC|Port and containerterminal business|-|26.77|Equity method|
|Shanghai International Port (Group) Co., Ltd.|||||||

(2) Financial information of material joint venture
RMB
|||||||
|-|-|-|-|-|-|
||||Shanghai International Port (Group) Co., Ltd.|||
||Item||Closing||Opening|
||||balance/2019.6.30||balance/2018.6.30|
||Current assets|47,539,141,288.39||47,842,620,837.32||
|I|ncluding: cash and cash equivalent|25,364,402,311.82||27,935,157,994.83||
||Non-current assets|96,746,170,384.55||96,524,413,178.58||
||Total assets|144,285,311,672.94||144,367,034,015.90||
||Current liabilities|21,448,362,445.85||31,676,398,710.35||
||Non-current liabilities|36,362,736,405.45||30,340,320,855.30||
||Total liabilities|57,811,098,851.30||62,016,719,565.65||
||Minority interests|8,859,720,874.78||6,802,318,747.82||
|c|Total equity attributable to shareholders of the parent|77,614,491,946.86||75,547,995,702.43||
||ompany|||||
|i|Net assets calculated based on the proportion of ownership|20,777,399,494.17||20,216,643,649.97||
||nterest|||||
||Adjustments|||||
||- Goodwill|2,076,585,747.12||2,076,585,747.12||
||- Others|-107,548,580.88||-105,669,326.14||
||Carrying amounts of equity investments in Joint Ventures|22,746,436,660.41||22,187,560,070.95||
|Fq|air value of joint venture equity investment with public|42,301,474,108.52||32,129,272,123.48||
||uotation|||||
||Operating Income|17,198,832,228.65||17,509,798,030.81||
||Net profit|4,880,941,188.89||3,994,224,347.76||
||Other comprehensive income|-20,755,561.56||-33,691,028.03||
||Total comprehensive income|4,860,185,627.33||3,960,533,319.73||
||Dividends received from joint ventures in the current year|955,194,576.56||1,059,194,508.74||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
VII EQUITY IN OTHER ENTITIES - continued
2. Interests in joint ventures and associates - continued
(3) Summarized financial information of immaterial associates and joint ventures
RMB
||||||||
|-|-|-|-|-|-|-|
||||Closing balance/2019.6.30||Opening balance/2018.6.3|0|
|J|oint ventures:||||||
|T|otal carrying amounts of investment|9,510,520,238.47||11,262,385,360.13|||
|p|Aggregate of following items calculated based on the||||||
||roportion of ownership interest||||||
||- Net profit|254,349,467.45||229,342,069.59|||
||- Other comprehensive income|-||-|||
||- Total comprehensive income|254,349,467.45||229,342,069.59|||
||Associates:||||||
|T|otal carrying amounts of investment|16,844,307,647.78||15,712,222,922.46|||
|p|Aggregate of following items calculated based on the||||||
||roportion of ownership interest||||||
||- Net profit|376,935,222.00||373,902,026.45|||
||- Other comprehensive income|-51,009,353.70||-4,420,381.69|||
||- Total comprehensive income|325,925,868.30||369,481,644.76|||

 (4) The long-term equity investments of the Group were not subject to restriction on disposal or remittance of return on investments.
VIII FINANCIAL INSTRUMENTS AND RISK MANAGEMENT
The Group's major financial instruments include cash and bank balances, notes receivable, account receivables, interest receivable, other receivables, available-for-sale financial assets, account payables, interest payable, dividends payable, other payables, other current liabilities, bonds payable and long-term payables. Details of these financial instruments are disclosed in Notes (V). The risks associated with these financial instruments and the policies on how to mitigate these risks are set out below. Management manages and monitors these exposures to ensure the risks are monitored at a certain level.
The Group adopts sensitivity analysis techniques to analyze how the entity's profit or loss and for the period and shareholders' equity would have been affected by changes in the relevant risk variables that were reasonably possible. As it is unlikely that risk variables will change in an isolated manner, and the interdependence between risk variables will have significant effect on the amount ultimately influenced by the changes in a single risk variable, the following items are based on the assumption that each risk variable has changes on a stand-alone basis.
1． Risk management objectives and policies
The Group's risk management objectives are to achieve proper balance between risks and yield, minimize the adverse impacts of risks on the Group's operation performance, and maximize the benefits of the shareholders and other equity investors. Based on these risk management
objectives, the Group's basic risk management strategy is to identify and analyze the industry's
exposure to various risks, establish appropriate bottom line for risk tolerance, implement risk
management, and monitors these exposures to ensure the risks are monitored at a certain level.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
VIII FINANCIAL INSTRUMENTS AND RISK MANAGEMENT - continued
1． Risk management objectives and policies - continued
1.1 Market risk
1.1.1 Currency risk
Currency risk is the risk that losses will occur because of changes in foreign exchange rates. The Group's exposure to the currency risk is primarily associated with FCFA and HKD. Several of the Group's subsidiaries have purchases and sales denominated in HKD while the Group's other principal activities are denominated and settled in RMB. As at 30 June 2019, the balance of the Group's assets and liabilities are both denominated in functional currency, except that balance of assets set out below is in HKD and USD. Currency risk arising from the foreign currency balance of assets and liabilities may have impact on the Group's performance.
RMB
||||||
|-|-|-|-|-|
|Item||Closing balance||Opening balance|
|Cash and bank balances|1,901,107,398.04||2,134,538,905.15||
|Accounts receivable|189,996,558.75||159,141,161.37||
|Other receivables|1,618,633,171.70||574,646,768.14||
|Short-term borrowings|1,353,835,000.00||1,825,358,000.00||
|Accounts payable|46,851,418.24||45,071,940.89||
|Other payables|536,615,622.71||512,625,788.26||
|Non-current liabilities due within one year|239,200,200.00||220,116,765.00||
|Long-term borrowings|1,793,770,925.00||1,926,978,130.00||
|Bonds payable|20,927,597,972.79||21,384,578,670.28||
|Long-term payables|422,118,000.00||423,754,200.00||

 The Group closely monitors the effects of changes in the foreign exchange rates on the Group's currency risk exposures. According to the current risk exposure and judgment of the exchange rate movements, management considers the probable heavy loss resulted from foreign exchange rate fluctuation to be fairly low.
Sensitivity analysis on currency risk
The assumption for the sensitivity analysis on currency risk is that all the cash flow hedges and hedges of a net investment in a foreign operation are highly effective. On the basis of the above assumption, where all other variables are held constant, the reasonably possible changes in the foreign exchange rate may have the following pre-tax effect on the profit or loss for the period or equity:
RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|||||Amount incurred in the current period||||Amount incurred in the previous period|||
|Item||Changes in exchange rate||||Effect on shareholders'||||Effect on shareholders'|
|||||Effect on profits||||Effect on profits|||
|||||||equity||||equity|
|All foreign currencies|5% increase against RMB||-13,659,249.98||-13,659,249.98||-11,394,591.45||-11,394,591.45||
|All foreign currencies|5% decrease against RMB||13,659,249.98||13,659,249.98||11,394,591.45||11,394,591.45||
|All foreign currencies|5% increase against USD||62,242.42||62,242.42||17,324.20||17,324.20||
|All foreign currencies|5% decrease against USD||-62,242.42||-62,242.42||-17,324.20||-17,324.20||
|All foreign currencies|5% increase against HKD||-1,142,869,420.70||-1,142,869,420.70||-1,098,658,981.68||-1,098,658,981.68||
|All foreign currencies|5% decrease against HKD||1,142,869,420.70||1,142,869,420.70||1,098,658,981.68||1,098,658,981.68||
||5% increase againstFCFA||-52,662,699.84||-52,662,699.84||-63,413,556.92||-63,413,556.92||
|All foreign currencies|||||||||||
||5% decrease againstFCFA||52,662,699.84||52,662,699.84||63,413,556.92||63,413,556.92||
|All foreign currencies|||||||||||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
VIII FINANCIAL INSTRUMENTS AND RISK MANAGEMENT - continued
1． Risk management objectives and policies - continued
1.1 Market risk - continued
1.1.2 Interest rate risk - changes in cash flows
Risk derived from changes in cash flows of financial instruments is mainly related to bank loans with floating interest rate. (See Notes (V) 24 and Notes (V) 34). This Group takes the measure of maintaining the floating interest rate of the bank loans, as a way to reduce the interest rate risk arising from changes in fair value.
Sensitivity analysis of interest rate risk
Sensitivity analysis of interest rate risk is based on the following assumptions:
• Fluctuations of market interest rate can affect the interest income or expense of a financial instrument with floating interest rate.
• For a financial instrument at fair value with fixed interest rate, the fluctuations of market interest rate can only affect its interest income or expense.
• For a derivative financial instrument recognized as hedging instrument, the fluctuations of market interest rate affects its fair value and interest rate hedging estimation are effective and efficient.• Market interest rate at the balance sheet date is adopted to calculate fair value changes of derivative financial instruments and other financial assets and liabilities under discounted cash flow method. Given that other variables unchanged on the basis of above assumptions, the pre-tax effect on the profit or loss for the current period from possible and reasonable changes of interest rate are as follows:
RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|||||Amount incurred in the current period||||Amount incurred in the previous period|||
|||Changes in|||||||||
|Item||||||Effect on shareholders'||||Effect on|
|||interest rate|||||||||
|||||Effect on profits||equity||Effect on profits||shareholders' equity|
|Short-term & Long-term|1% increase||-118,576,065.38||-118,576,065.38||-119,061,442.29||-119,061,442.29||
|borrowings|||||||||||
|Short-term & Long-term|1% decrease||118,576,065.38||118,576,065.38||119,061,442.29||119,061,442.29||
|borrowings|||||||||||

1.1.3 Other price risk
Available-for-sale financial assets are measured at fair value by the Group at the balance sheet date. Hence the Group takes risk of changes in the securities market. The Group closely monitors the effects of changes in the foreign exchange prices on the Group's equity investment securities. The Group has not taken any measures to reduce prices risk of equity investment securities.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
VIII FINANCIAL INSTRUMENTS AND RISK MANAGEMENT - continued
1． Risk management objectives and policies - continued
1.2 Credit risk
As at 30 June 2019, the Group's maximum exposure to credit risk which will cause a financial loss to the Group due to failure to discharge an obligation by the counterparties and financial guarantees issued by the Group is arising from the carrying amount of the respective recognized financial assets as stated in the consolidated balance sheet. For financial instruments measured at fair value, the carrying amount reflects the exposure to risks but not the maximum exposure to risks; the maximum exposure to risks would vary according to the future changes in fair value. In order to minimize the credit risk, the Group has delegated a team responsible for determination of credit limits, credit approvals and other monitoring procedures to ensure that follow-up action is taken to recover overdue debts. In addition, the Group reviews the recoverable amount of each individual trade debt at each balance sheet date to ensure that adequate impairment losses are made for irrecoverable amounts. In this regard, the management of the Group considers that the Group's credit risk is significantly reduced.
The credit risk on liquid funds is limited because the counterparties are banks with high credit ratings.
The Group adopted necessary policies to make sure that all clients and customers are attributed with merit credit records.
1.3 Liquidity risk
In the management of the liquidity risk, the Group monitors and maintains a level of cash and cash equivalents deemed adequate by the management to finance the Group's operations and mitigate the effects of fluctuations in cash flows. The management monitors the utilization of bank loans and ensures compliance with loans covenants.
The following is the maturity analysis for financial assets and financial liabilities held by the Group which is based on undiscounted remaining contractual obligations:
RMB
||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|
|Item||Carrying amount||Total amount||Within 1 year||1-5 years||More than 5 years|
|The non-derivative financial liabilities|||||||||||
|Short-term borrowings|7,566,020,460.46||7,680,253,280.22||7,680,253,280.22||-||-||
|Notes payable|69,419,891.54||69,419,891.54||69,419,891.54||-||-||
|Accounts payable|544,188,025.02||544,188,025.02||544,188,025.02||-||-||
|Other payables|3,421,776,143.11||3,421,776,143.11||3,421,776,143.11||-||-||
|Non-current liabilities due|3,674,331,926.09||4,796,945,410.85||4,796,945,410.85||-||-||
|within one year|||||||||||
|Other current liabilities|1,456,067,284.82||1,477,688,537.01||1,477,688,537.01||-||-||
|Long-term borrowings|7,456,687,214.19||8,240,552,415.69||-||6,956,939,268.10||1,283,613,147.59||
|Bonds payable|22,057,369,574.31||26,085,600,005.34||-||17,569,337,643.53||8,516,262,361.81||
|Lease liabilities|1,740,889,561.88||2,667,650,055.19||-||1,424,484,522.95||1,243,165,532.24||
|Long-term payables|405,682,500.70||405,682,500.70||-||7,361,184.90||398,321,315.80||
|The derivative financial liabilities|||||||||||
|Other non-current liabilities|629,342,778.85||629,342,778.85||-||629,342,778.85||-||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
IX FAIR VALUE
1. Closing balance of assets and liabilities measured at fair value
RMB
||||||
|-|-|-|-|-|
||Closing Balance||||
|Item|||||
||Level 1|Level 2|Level 3|Total|
|Measurements at fair value|||||
|continuously|||||
|Other investments in equity instruments|10,740,000.00|-|555,343,559.83|566,083,559.83|
|Other non-current financial assets|1,995,800,552.72|-|1,023,818,169.86|3,019,618,722.58|
|Total assets measured at fair value|2,006,540,552.72|-|1,579,161,729.69|3,585,702,282.41|
|continuously|||||
|Other non-current liabilities|-|-|4,044,601,206.09|4,044,601,206.09|
|Total liabilities measured at fair value|-|-|4,044,601,206.09|4,044,601,206.09|
|continuously|||||

2. Basis for determining the market price measured at fair value at level I continuously The market price of assets and liabilities measured at fair value at level I continuously is determined by the Shanghai stock exchange and the Stock Exchange of Hong Kong Ltd. closing price of equity instruments at 28 June 2019.
3. Level 3 continuously fair value measure instruments, using valuation method and qualitative and quantitative information on important parameters.
RMB
||||||
|-|-|-|-|-|
||Closing Balance|Opening Balance|||
|Item|||Valuation method|Input|
||Fair Value|Fair Value|||
|Other investments in equity instruments|555,343,559.83|238,048,314.30|Net assets method|Net asset value|
||2,000,000.00|2,000,000.00|Discounted cash flowmethod|Discount rate|
|Other non-current financial assets|||||
|Other non-current financial assets|15,933,478.80|689,901.07|Net assets method|Net asset value|
||1,005,884,691.06|533,366,660.39|Comparative method oflisted company|Stock Price|
|Other non-current financial assets|||||
||3,415,258,427.24|3,260,547,002.45|Discounted cash flowmethod|Discount rate|
|Other non-current liabilities|||||
||629,342,778.85|579,195,304.56|Option pricing method|Executive price,expected volatility, etc.|
|Other non-current liabilities|||||

 The fair value of other investments in equity instruments that are measured at fair value through profit or loss or other comprehensive income is determined using valuation methods such as discounted cash flow method, net assets method, and comparative method of listed company. At the time of valuation, the Group needs to estimate future cash flows, credit risk, market volatility and correlation, select an appropriate discount rate and consider the discount premium adjustment. 4. Information of financial assets and financial liabilities that are not measured at fair value
Financial assets and financial liabilities that are not measured at fair value include notes and accounts receivable, other receivables, short-term borrowings, notes and accounts payable, other receivables, long-term borrowings, bonds payable, long-term payables.
The management considers that the carrying amount of financial assets and liabilities measured at amortized cost is approximately equal to the fair value of financial assets and liabilities.
The fair value of note payable which has active market price should be determined by the active
market price. The fair value of long-term borrowings, long-term payable and note payable without
active market price, should be determined by the net present value of cash flow stated in contract
and the discount rate which has the same rank of credit.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
X RELATED PARTY RELATIONSHIPS AND TRANSACTIONS
1. Parent of the Company
||||||||||
|-|-|-|-|-|-|-|-|-|
||||||||Proportion of the|Proportion of the|
||Related party||Place of|Legal|Nature of||entity's ownership|entity's voting|
|Name of the parent||Type of the entity||||Issued share capital|||
||relationship||incorporation|representative|business||interests held by the|power held by the|
||||||||parent (%)|parent (%)|
||Parentcompany|Private limited company(share limited)|Hong Kong|Deng Weidong|Investmentholding|HKD21,120,986,262|3.08|87.81 (Note)|
|Broadford Global Limited|||||||||

Note: Broadford directly obtained3.08% equity of the Company,20.68% equity via its subsidiary China Merchants Port Development (Shenzhen) Co., Ltd., and obtained another64.05% equity by its subsidiary CMID.
The ultimate actual controller of the Company is CMG.
2． Subsidiaries of the Company
The general background and other related information of subsidiaries are set out in Notes (VII) 1. 3. Associates and joint ventures of the Company
The general background and other related information of the significant associates and joint ventures are set out in Notes (VII) 2.
Other joint ventures or joint ventures that occurred related party transactions and formed balances with the Group this year are as follows:
||||
|-|-|-|
|||Relationships between other related|
|Name of other related parties|||
|||parties and the Company|
|China Overseas Harbour Affairs (Laizhou) Co., Ltd.|Joint venture||
|China Zhanjiang Foreign Shipping Agency Co., Ltd.|Joint venture||
|Guangdong Zhanjiang Port Longteng Shipping Co., Ltd.|Joint venture||
|Guizhou East Land Port Operation Co., Ltd.|Joint venture||
|Ningbo Daxie Merchants International Wharf Co., Ltd.|Joint venture||
|Port of Newcastle and its subsidiaries|Joint venture||
|Qingdao Qianwan New United Container Terminal Co., Ltd.|Joint venture||
|Qingdao Qianwan United Container Terminal Co., Ltd.|Joint venture||
|Qingdao Qianwan West Port United Wharf Co., Ltd.|Joint venture||
|Zhanjiang COSCO Shipping Logistics Co., Ltd.|Joint venture||
|Chu Kong River Trade Terminal Co., Ltd.|Associate Company||
|China Merchants Qianhai Chidi Industrial (Shenzhen) Co., Ltd.|Associate Company||
|Dalian Port Co., Ltd.|Associate Company||
|Great Horn Development Company FZCO|Associate Company||
|Guizhou Qiandongnan Land Port Operation Co., Ltd.|Associate Company||
|International Djibouti Industrial Parks Operation FZCO|Associate Company||
|Modern Terminals Limited|Associate Company||
|Nanshan Group and its subsidiaries|Associate Company||
|Port de Djibouti S.A.|Associate Company||
|Shanghai International Port (Group) Co., Ltd.|Associate Company||
|Shenzhen Globex e-Service Inc.|Associate Company||
|Shenzhen Qianhai Shekou Qidi Industrial Co., Ltd.|Associate Company||
|Shenzhen Qianhai Shekou Qiming Industrial Co., Ltd.|Associate Company||
|Terminal Link SAS|Associate Company||
|Tianjin Haitian Bonded Logistics Co., Ltd.|Associate Company||
|Tin-Can Island Container Terminal Ltd|Associate Company||
|Zhangzhou COSCO Shipping Agency Co., Ltd.|Associate Company||
|Zhanjiang Merchants Port City Investment Co., Ltd.|Associate Company||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
X RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
4. Other related parties of the Company
|||
|-|-|
||Relationships between other related|
|Name of other related parties||
||parties and the Company|
|Qingdao Port (Group) Co., Ltd.|minority shareholders of subsidiaries|
|Yihai Kerry|minority shareholders of subsidiaries|
|China Communications Import & Export Co., Ltd.|Controlled by the same ultimate actual controller|
|China Marine Shipping Agency Shenzhen Company Limited|Controlled by the same ultimate actual controller|
|China Merchants (Shenzhen) Power Supply Co., Ltd.|Controlled by the same ultimate actual controller|
|China Merchants Bureau Logistics Group Qingdao Co., Ltd.|Controlled by the same ultimate actual controller|
|China Merchants Bureau Zhongbai Commercial Logistics Co., Ltd.|Controlled by the same ultimate actual controller|
|China Merchants Financial Leasing (Tianjin) Co., Ltd.|Controlled by the same ultimate actual controller|
|China Merchants Food Co., Ltd.|Controlled by the same ultimate actual controller|
|China Merchants Group Finance Company Limited|Controlled by the same ultimate actual controller|
|China Merchants Group Gangtong Development (Shenzhen) Co., Ltd.|Controlled by the same ultimate actual controller|
|China Merchants Landmark (Shenzhen) Co ., Ltd.|Controlled by the same ultimate actual controller|
|China Merchants Life Insurance Co., Ltd.|Controlled by the same ultimate actual controller|
|China Merchants Ocean Shipping Agency Shenzhen Co ., Ltd.|Controlled by the same ultimate actual controller|
|China Merchants Securities Co., Ltd.|Controlled by the same ultimate actual controller|
|China Merchants Shekou Industrial Zone Holdings Co., Ltd.|Controlled by the same ultimate actual controller|
|China Merchants Steam Navigation Company Limited|Controlled by the same ultimate actual controller|
|China Merchants Trading Financial Leasing Co., Ltd.|Controlled by the same ultimate actual controller|
|China Merchants Zhangzhou Development Zone Co., Ltd.|Controlled by the same ultimate actual controller|
|China Ocean Shipping Agency Shenzhen|Controlled by the same ultimate actual controller|
|Cm Houlder Insurance Brokers Limited|Controlled by the same ultimate actual controller|
|CMHK|Controlled by the same ultimate actual controller|
|CMID|Controlled by the same ultimate actual controller|
|CMU|Controlled by the same ultimate actual controller|
|CSC RoRo Logistics Co., Ltd.|Controlled by the same ultimate actual controller|
|Euro Asia Dockyard Enterprise and development Ltd.|Controlled by the same ultimate actual controller|
|Guangdong Sinotrans Co., Ltd.|Controlled by the same ultimate actual controller|
|Guangdong Sinotrans Shipping Agency Co., Ltd.|Controlled by the same ultimate actual controller|
|Hoi Tung (Shanghai) Co., Ltd.|Controlled by the same ultimate actual controller|
|Huanan Refrigeration Ice Making (Shenzhen) Co., Ltd.|Controlled by the same ultimate actual controller|
|Investment Promotion Bureau Zhangzhou Development Zone Power|Controlled by the same ultimate actual controller|
|Supply Co., Ltd.||
|Orientrue Holdings Company Limited|Controlled by the same ultimate actual controller|
|Qingdao Bonded Logistics Park Sino-foreign Transport Warehousing|Controlled by the same ultimate actual controller|
|Logistics Co., Ltd.||
|Qingdao Sino-foreign Transport Supply Chain Management Co., Ltd|Controlled by the same ultimate actual controller|
|Shenzhen Investment Promotion Real Estate Management Co., Ltd.|Controlled by the same ultimate actual controller|
|Shenzhen Merchants Commercial Property Investment Co., Ltd|Controlled by the same ultimate actual controller|
|Shenzhen Merchants Construction Co., Ltd.|Controlled by the same ultimate actual controller|
|Shenzhen Nanyou (Holdings) Ltd|Controlled by the same ultimate actual controller|
|Shenzhen Science and Technology University Phase II Real Estate|Controlled by the same ultimate actual controller|
|Management Co., Ltd||
|Sinotrans Container Lines Co., Ltd.|Controlled by the same ultimate actual controller|
|Sinotrans South China Co., Ltd.|Controlled by the same ultimate actual controller|
|Sinotrans(NZ)Limited|Controlled by the same ultimate actual controller|
|South China Sinotrans Supply Chain Management Co., Ltd.|Controlled by the same ultimate actual controller|
|Yiu Lian Dockyards (Shekou) Limited|Controlled by the same ultimate actual controller|
|Yiu Lian Dockyards Limited|Controlled by the same ultimate actual controller|
||Affected significantly by the ultimate actualcontroller|
|China Merchants Bank Company Limited||
||Affected significantly by the ultimate actualcontroller|
|Khor Ambado FZCo||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
X RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transaction
(1) Provision and receipt of services
RMB
||||||
|-|-|-|-|-|
|||Pricing and decision-|||
||Content of related party||Amount incurred in|Amount incurred in|
|Related party||making procedures of|||
||transaction||the current period|the previous period|
|||related party transactions|||
|Receipt of services：|||||
|Qingdao Qianwan West Port United Wharf Co.,|Service expenditure|Negotiation|7,820,606.36|6,388,961.97|
|Ltd.|||||
|Yiu Lian Dockyards Limited|Service expenditure|Negotiation|6,657,382.97|4,241,187.01|
|Investment Promotion Bureau Zhangzhou|Service expenditure|Negotiation|2,489,368.18|2,729,422.78|
|Development Zone Power Supply Co., Ltd.|||||
|CM Houlder Insurance Brokers Limited|Service expenditure|Negotiation|2,368,789.29|1,919,388.50|
|China Merchants Bureau Logistics Group|Service expenditure|Negotiation|2,318,455.39|1,472,625.21|
|Qingdao Co., Ltd.|||||
|China Marine Shipping Agency Shenzhen|Service expenditure|Negotiation|1,551,472.60|1,864,647.00|
|Company Limited|||||
|China Merchants Life Insurance Co., Ltd.|Service expenditure|Negotiation|1,260,870.00|-|
|China Merchants (Shenzhen) Power Supply.,|Service expenditure|Negotiation|1,221,907.07|-|
|Ltd.|||||
|Shenzhen Merchants Commercial Property|Service expenditure|Negotiation|839,712.18|3,573,558.17|
|Investment Co., Ltd|||||
|Hoi Tung (Shanghai) Co., Ltd.|Service expenditure|Negotiation|721,332.69|1,520,566.07|
|Nanshan Group and its subsidiaries|Service expenditure|Negotiation|20,811,589.38|154,023.94|
|Other related parties|Service expenditure|Negotiation|4,223,917.12|3,103,481.41|
|China Merchants Group Finance Company|Interest expense|Negotiation|22,155,171.89|30,007,520.45|
|Limited|||||
|China Merchants Financial Leasing (Tianjin)|Interest expense|Negotiation|16,845,432.46|-|
|Co., Ltd.|||||
|China Merchants Trading Financial Leasing Co.,|Interest expense|Negotiation|5,249,947.35|-|
|Ltd.|||||
|Port de Djibouti S.A.|Interest expense|Negotiation|7,232,442.29|11,461,371.70|
|China Merchants Bank Company Limited|Interest expense|Negotiation|2,052,399.21|104,400.00|
|China Merchants Steam Navigation Company|Interest expense|Negotiation|-|2,930,589.05|
|Limited|||||
|Total|||105,820,796.43|71,471,743.26|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
X RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transaction - continued
(1) Provision and receipt of services - continued
RMB
||||||
|-|-|-|-|-|
|||Pricing and decision-|||
||Content of related||Amount incurred in|Amount incurred in|
|Related party||making procedures of|||
||party transaction||the current period|the previous period|
|||related party transactions|||
|Provision of service：|||||
|Zhanjiang COSCO Shipping Logistics Co., Ltd.|Service revenue|Negotiation|68,740,946.61|-|
|Qingdao Qianwan United Container Terminal Co., Ltd.|Service revenue|Negotiation|23,270,413.55|27,383,331.91|
|Guangdong Sinotrans Shipping Agency Co., Ltd.|Service revenue|Negotiation|14,512,429.32|-|
|China Ocean Shipping Agency Shenzhen|Service revenue|Negotiation|9,625,816.92|14,282,554.33|
|Qingdao Qianwan West Port United Wharf Co., Ltd.|Service revenue|Negotiation|7,252,854.49|7,578,407.01|
|China Zhanjiang Foreign Shipping Agency Co., Ltd.|Service revenue|Negotiation|6,555,068.00|-|
|China Marine Shipping Agency Shenzhen Company|Service revenue|Negotiation|4,237,100.48|4,783,876.73|
|Limited|||||
|Shenzhen Globex e-Service Inc.|Service revenue|Negotiation|3,512,554.86|9,628,587.49|
|Qingdao Bonded Logistics Park Sino-foreign Transport|Service revenue|Negotiation|3,351,153.05|1,330,841.62|
|Warehousing Logistics Co., Ltd.|||||
|Huanan Refrigeration Ice Making (Shenzhen) Co., Ltd.|Service revenue|Negotiation|3,219,796.19|3,177,726.28|
|International Djibouti Industrial Parks Operation FZCO|Service revenue|Negotiation|3,024,632.49|4,113,881.13|
|Sinotrans(NZ)Limited|Service revenue|Negotiation|2,934,349.53|3,333,363.12|
|Guizhou East Land Port Operation Co., Ltd.|Service revenue|Negotiation|2,648,998.97|-|
|China Merchants Ocean Shipping Agency Shenzhen|Service revenue|Negotiation|2,617,701.90|1,685,402.28|
|Co., Ltd.|||||
|Sinotrans Container Lines Co., Ltd.|Service revenue|Negotiation|2,142,579.09|1,758,999.41|
|Qingdao Sino-foreign Transport Supply Chain|Service revenue|Negotiation|2,115,762.23|756,572.78|
|Management Co., Ltd|||||
|Khor Ambado FZCo|Service revenue|Negotiation|1,926,229.57|-|
|Guangdong Zhanjiang Port Longteng Shipping Co.,|Service revenue|Negotiation|1,894,585.42|-|
|Ltd.|||||
|Ningbo Daxie Merchants International Wharf Co., Ltd.|Service revenue|Negotiation|1,813,217.20|1,857,964.16|
|Zhangzhou COSCO Shipping Agency Co., Ltd.|Service revenue|Negotiation|1,697,544.92|2,830,809.84|
|Sinotrans South China Co., Ltd.|Service revenue|Negotiation|1,649,637.78|-|
|Qingdao Qianwan New United Container Terminal Co.,|Service revenue|Negotiation|1,542,824.76|1,697,109.96|
|Ltd.|||||
|Guizhou Qiandongnan Land Port Operation Co., Ltd.|Service revenue|Negotiation|1,402,503.16|-|
|CMHK|Service revenue|Negotiation|1,212,000.00|1,600,000.00|
|South China Sinotrans Supply Chain Management Co.,|Service revenue|Negotiation|1,172,263.27|-|
|Ltd.|||||
|Yiu Lian Dockyards Limited|Service revenue|Negotiation|1,022,126.23|78,003.40|
|Terminal Link SAS|Service revenue|Negotiation|677,993.43|1,032,694.97|
|China Merchants Shekou Industrial Zone Holdings Co.,|Service revenue|Negotiation|236,234.38|1,101,990.13|
|Ltd.|||||
|Yiu Lian Dockyards (Shekou) Limited|Service revenue|Negotiation|137,886.77|1,428,891.30|
|Great Horn Development Company FZCO|Service revenue|Negotiation|17,158.00|2,138,290.36|
|China Merchants Bureau Zhongbai Commercial|Service revenue|Negotiation|-|2,484,304.00|
|Logistics Co., Ltd.|||||
|Other related parties|Service revenue|Negotiation|5,656,891.38|6,727,086.41|
|Port of Newcastle and its subsidiaries|Interest income|Negotiation|31,081,650.64|-|
|Zhanjiang Merchants Port City Investment Co., Ltd.|Interest income|Negotiation|21,757,232.69|-|
|Khor Ambado FZCo|Interest income|Negotiation|17,843,227.14|23,670,141.53|
|China Merchants Bank Company Limited|Interest income|Negotiation|9,563,846.93|8,980,854.61|
|China Merchants Group Finance Company Limited|Interest income|Negotiation|5,065,260.89|2,833,812.80|
|Modern Terminals Limited|Interest income|Negotiation|-|1,066,665.85|
|Other related parties|Interest income|Negotiation|707,428.30|727,927.96|
|Total|||267,839,900.54|140,070,091.37|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
X RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transaction - continued
(2) Transferred assets with related parties
RMB
||||||
|-|-|-|-|-|
|||Pricing and decision-|||
||Content of related party||Amount incurred in|Amount incurred in|
|Related party||making procedures of|||
||transaction||the current period|the previous period|
|||related party transactions|||
|China Merchants Qianhai|Transferred land use rightand attached buildings|Negotiation|5,693,300,571.00|-|
|Chidi Industrial (Shenzhen)|||||
|Co., Ltd.|||||

(3) Leases with related parties
The Group as thelessor：
RMB
||||||
|-|-|-|-|-|
|||Pricing and decision-|||
||||Lease income|Lease income|
|||making procedures of|||
|Name of lessee|Type of leased assets||recognized in the|recognized in the|
|||related party|||
||||current year|previous year|
|||transactions|||
|China Merchants Food Co., Ltd.|Buildings|Negotiation|3,168,622.24|-|
|Shenzhen Nanyou (Holdings) Ltd|Buildings|Negotiation|2,633,394.00|1,200,285.71|
|China Communications Import & Export|Buildings|Negotiation|1,422,211.91|1,349,611.80|
|Co., Ltd.|||||
|Nanshan Group and its subsidiaries|Buildings|Negotiation|1,148,239.51|-|
|China Merchants Securities Co., Ltd.|Buildings|Negotiation|1,127,724.90|-|
|Yiu Lian Dockyards (Shekou) Limited|Buildings|Negotiation|1,052,835.10|1,053,794.21|
||Buildings andLand use right|Negotiation|1,497,498.50|1,861,506.06|
|Other related parties|||||
|Total|||12,050,526.16|5,465,197.78|

 The Group as the lessee:
RMB
||||||
|-|-|-|-|-|
|||Pricing and decision-|||
||||Lease payment|Lease payment|
|||making procedures of|||
|Name of lessor|Type of leased assets||recognized in the|recognized in the|
|||related party|||
||||current year|previous year|
|||transactions|||
|Nanshan Group and its subsidiaries|Buildings|Negotiation|36,977,408.65|32,136,749.81|
|China Merchants Shekou Industrial Zone|Land use right|Negotiation|17,518,979.49|20,646,048.29|
|Holdings Co., Ltd.|||||
|Euro Asia Dockyard Enterprise and|Buildings andLand use right|Negotiation|6,692,164.17|6,285,218.70|
|development Ltd.|||||
|Shenzhen Merchants Commercial|Buildings|Negotiation|5,329,819.55|2,463,752.92|
|Property Investment Co., Ltd|||||
|Shenzhen Investment Promotion Real|Buildings|Negotiation|3,931,826.86|2,471,966.47|
|Estate Management Co., Ltd.|||||
|Shenzhen Science and Technology|Buildings|Negotiation|1,770,702.00|1,770,702.00|
|University Phase II Real Estate|||||
|Management Co., Ltd|||||
||Buildings,Land use right andothers|Negotiation|2,838,214.50|4,193,656.32|
|Other related parties|||||
|Total|||75,059,115.22|69,968,094.51|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
X RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transaction - continued
(4) The Group as the guarantor
RMB
|||||||
|-|-|-|-|-|-|
||||Guarantee|Guarantee|The guarantee has|
|Warrantee|Credit Line|Guarantee amount||||
||||Starting Date|maturity date|been completed|
|For the period for 1 January to 30 June 2019||||||
|CMA CGM S.A.(Note)|78,737,610.08|78,737,610.08|June 2013|2033|No|
|CMA CGM S.A.(Note)|10,748,375.00|5,266,703.75|June 2013|2019|No|
|Port de Djibouti S.A.|343,735,000.00|8,077,772.50|14 June 2016|14 July 2019|No|
|Khor Ambado FZCo|197,991,360.00|75,761,819.65|24 May 2019|2032|No|
|Total|631,212,345.08|167,843,905.98||||
|2018||||||
|CMA CGM S.A.(Note)|82,195,789.24|82,195,789.24|June 2013|2033|No|
|CMA CGM S.A.(Note)|24,982,114.97|12,241,236.33|June 2013|2019|No|
|Port de Djibouti S.A.|343,160,000.00|24,192,780.00|14 June 2016|14 July 2019|No|
|Total|450,337,904.21|118,629,805.57||||

Note: CMA CGM S.A. is the other shareholder of Terminal Link SAS which is our group's associate. Our group has made a commitment for CMA CGM S.A. according to the guarantee made by CMA CGM S.A to Terminal Link SAS's bank loan and other debt. The commitment is limited to the49% interest that our group has in Terminal Link SAS and the commitment amount is RMB 84,004,313.83. If any other guarantee fees occurred, our group would make the compensation.
(5) Relevant party funds borrowing
RMB
|||||||||
|-|-|-|-|-|-|-|-|
|Related parties|Loan Amount||Starting date||Due date||Instructions|
|For the period from 1 January to 30 June 2019||||||||
|Borrowings||||||||
|China Merchants Group|270,000,000.00|22 April 2019||21 April 2020||Fixed Annual InterestRate 4.35%||
|Finance Company Limited||||||||
|China Merchants Group|28,000,000.00|15 January 2019||14 January 2024||Fixed Annual InterestRate 4.75%||
|Finance Company Limited||||||||
|China Merchants Group|25,000,000.00|10 June 2019||14 January 2024||Fixed Annual InterestRate 4.75%||
|Finance Company Limited||||||||
|China Merchants Group|20,000,000.00|4 June 2019||3 June 2020||Fixed Annual InterestRate 4.35%||
|Finance Company Limited||||||||
|Total|343,000,000.00|||||||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
X RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
5. Related party transaction - continued
(5) Relevant Party Funds Borrowing - continued
RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
|Related parties||Loan Amount||Starting date||Due date||Instructions|
|2018|||||||||
|Borrowing|||||||||
|China Merchants Group|270,000,000.00||23 April 2018||22 April 2019||Fixed Annual InterestRate 4.35%||
|Finance Company Limited|||||||||
|China Merchants Group|220,000,000.00||17 May 2018||16 May 2019||Fixed Annual InterestRate 4.35%||
|Finance Company Limited|||||||||
|China Merchants Group|80,000,000.00||11 December 2018||10 December 2028||Fixed Annual InterestRate 4.802%||
|Finance Company Limited|||||||||
|China Merchants Group|60,000,000.00||19 June 2018||20 June 2019||Fixed Annual InterestRate 4.35%||
|Finance Company Limited|||||||||
|China Merchants Group|40,000,000.00||20 May 2018||21 May 2019||Fixed Annual InterestRate 4.35%||
|Finance Company Limited|||||||||
|China Merchants Group|30,000,000.00||7 December 2018||6 December 2019||Fixed Annual InterestRate 4.35%||
|Finance Company Limited|||||||||
|China Merchants Group|30,000,000.00||20 December 2018||19 December 2021||Fixed Annual InterestRate 4.275%||
|Finance Company Limited|||||||||
|China Merchants Group|25,000,000.00||6 December 2018||5 October 2021||Fixed Annual InterestRate 4.75%||
|Finance Company Limited|||||||||
|China Merchants Group|20,000,000.00||17 December 2018||16 December 2019||Fixed Annual InterestRate 4.35%||
|Finance Company Limited|||||||||
|Total|775,000,000.00||||||||
|Lending to|||||||||
|Port of Newcastle and its|784,057,712.75||14 June 2018||29 May 2020||Fixed Annual InterestRate 8.00%||
|subsidiaries|||||||||

 (6) Compensation for key management personnel
RMB
||||
|-|-|-|
||Amount incurred in|Amount incurred in the|
|Item|||
||the current period|previous period|
|Compensation for key management personnel|10,650,556.67|11,712,686.62|

 6. Amounts due from/to related parties
(1) Amounts due from related parties
RMB
|||||
|-|-|-|-|
|Item|Related parties|Closing balance|Opening balance|
||China Merchants Bank Company Limited|1,364,931,983.97|1,274,536,476.91|
|Cash and bank|China Merchants Group Finance CompanyLimited|395,263,736.99|494,131,151.34|
|balances||||
||Total|1,760,195,720.96|1,768,667,628.25|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
X RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
6. Amounts due from/to related parties - continued
(1) Amounts due from related parties - continued
RMB
|||||
|-|-|-|-|
|Item|Related parties|Closing balance|Opening balance|
||Zhanjiang COSCO Shipping Logistics Co., Ltd.|12,924,418.96|-|
||Shenzhen Globex e-Service Inc.|6,394,531.11|7,222,351.10|
||Guangdong Sinotrans Shipping Agency Co., Ltd.|4,583,528.65|-|
||China Ocean Shipping Agency Shenzhen|3,978,813.25|4,678,761.75|
||Guizhou Qiandongnan Land Port Operation Co., Ltd.|2,982,911.32|-|
||Guizhou East Land Port Operation Co., Ltd.|2,750,914.50|-|
||Sinotrans Container Lines Co., Ltd.|2,638,439.03|1,156,769.47|
||Qingdao Qianwan United Container Terminal Co., Ltd.|2,080,710.00|5,112,134.91|
||Qingdao Qianwan West Port United Wharf Co., Ltd.|1,850,127.57|74,485.74|
||Port de Djibouti S.A.|1,747,892.48|6,387,923.40|
|Accounts receivable||||
||Ningbo Daxie Merchants International Wharf Co., Ltd.|1,720,723.08|-|
||Great Horn Development Company FZCO|1,503,773.75|1,486,615.75|
||China Marine Shipping Agency Shenzhen Company Limited|1,226,060.75|1,115,972.50|
||Qingdao Sino-foreign Transport Supply Chain Management Co.,Ltd|1,069,174.15|66,039.36|
||CMHK|1,012,000.00|-|
||China Merchants Shekou Industrial Zone Holdings Co., Ltd.|914,392.86|1,029,573.58|
||China Overseas Harbour Affairs (Laizhou) Co., Ltd.|-|1,490,941.09|
||Other related parties|6,963,416.90|4,498,377.10|
||Total|56,341,828.36|34,319,945.75|
||China Merchants Qianhai Chidi Industrial (Shenzhen) Co., Ltd.|5,240,907,829.70|-|
||Shanghai International Port (Group) Co., Ltd.|910,321,459.36|50,118,027.14|
||Shenzhen Qianhai Shekou Qidi Industrial Co., Ltd.|708,835,049.08|-|
||Nanshan Group and its subsidiaries|316,395,169.40|175,976,941.31|
||Shenzhen Qianhai Shekou Qiming Industrial Co., Ltd.|99,695,266.22|-|
||Tin-Can Island Container Terminal Ltd|66,901,190.73|128,428.02|
||Zhanjiang Merchants Port City Investment Co., Ltd.|65,455,833.32|-|
||Chu Kong River Trade Terminal Co., Ltd|65,141,785.00|59,975,890.00|
||Dalian Port Co., Ltd.|46,490,179.50|-|
||Tianjin Haitian Bonded Logistics Co., Ltd.|34,300,000.00|34,300,000.00|
||Port de Djibouti S.A.|24,464,031.65|24,411,770.72|
||Port of Newcastle and its subsidiaries|15,596,590.78|15,858,848.40|
||China Merchants Financial Leasing (Tianjin) Co., Ltd.|10,000,000.00|-|
|Other receivables|Zhanjiang COSCO Shipping Logistics Co., Ltd.|6,805,591.72|-|
||China Zhanjiang Foreign Shipping Agency Co., Ltd.|3,428,227.26|-|
||Guangdong Zhanjiang Port Longteng Shipping Co., Ltd.|3,118,014.31|-|
||CSC RoRo Logistics Co., Ltd.|2,899,163.95|2,899,163.95|
||China Merchants Group Finance Company Limited|2,813,395.83|2,565,333.33|
||Guangdong Sinotrans Co., Ltd.|2,331,993.66|-|
||China Merchants Bank Company Limited|1,670,247.99|69,750.00|
||Euro Asia Dockyard Enterprise and development Ltd.|1,487,065.99|1,481,149.51|
||Shenzhen Merchants Commercial Property Investment Co., Ltd|900,067.18|1,051,801.58|
||Khor Ambado FZCo|4,124.82|7,332,144.82|
||Qingdao Qianwan United Container Terminal Co., Ltd.|3,000.00|25,000,000.00|
||Zhanjiang Port (Group) Co., Ltd.|-|9,253,682.23|
||Other related parties|3,387,896.87|3,442,223.51|
||Total|7,633,353,174.32|413,865,154.52|
|Prepayments|Hoi Tung (Shanghai) Co., Ltd.|368,224.00|-|
|Other current assets|Khor Ambado FZCo|-|1,029,478,047.00|
|Non-current assets|Port of Newcastle and its subsidiaries|782,529,437.63|-|
|due within one year||||
||Zhanjiang Merchants Port City Investment Co., Ltd.|931,598,613.39|-|
|Long-term|Terminal Link SAS|9,773,105.30|9,782,367.44|
|receivables|Port of Newcastle and its subsidiaries|-|784,057,712.75|
||Total|941,371,718.69|793,840,080.19|
|Other non-current|China Merchants Shekou Industrial Zone Holdings Co., Ltd.|-|43,472,687.00|
|assets||||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
X RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
6. Amounts due from/to related parties - continued
(2) Amounts due to related parties
RMB
|||||
|-|-|-|-|
|Item|Related parties|Closing balance|Opening balance|
||China Merchants Group Finance Company Limited|340,000,000.00|640,000,000.00|
|Short-term borrowings|China Merchants Bank Company Limited|70,000,000.00|-|
||Total|410,000,000.00|640,000,000.00|
||Nanshan Group and its subsidiaries|9,262,842.82|11,631,575.13|
||Qingdao Qianwan West Port United Wharf Co., Ltd.|5,842,096.04|5,196,134.76|
||Euro Asia Dockyard Enterprise and development Ltd.|3,766,222.07|3,698,897.16|
||Yiu Lian Dockyards Limited|2,846,657.74|2,204,328.63|
|Accounts payable||||
||China Merchants Bureau Logistics Group Qingdao Co.,Ltd.|1,061,263.18|928,527.51|
||Other related parties|2,848,061.68|2,323,725.85|
||Total|25,627,143.53|25,983,189.04|
|Receipts in advance|Other related parties|61,415.00|66,799.01|
||Qingdao Bonded Logistics Park Sino-foreign TransportWarehousing Logistics Co., Ltd.|1,372,160.61|490,063.65|
||Zhanjiang Port (Group) Co., Ltd.|N/A|1,287,452.83|
|Contract liabilities||||
||Qingdao Qianwan United Container Terminal Co., Ltd.|1,090,350.11|49,000.00|
||Other related parties|2,589,340.12|264,520.51|
||Total|5,051,850.84|2,091,036.99|
||CMU|484,126,088.18|-|
||CMID|117,851,351.28|-|
||China Merchants Zhangzhou Development Zone Co.,Ltd.|115,658,350.90|93,258,350.90|
||Terminal Link SAS|85,935,090.98|46,506,416.54|
||China Merchants Group Gangtong Development(Shenzhen) Co., Ltd.|42,280,092.00|-|
||Yihai Kerry|37,402,426.09|37,402,426.09|
||Sinotrans South China Co., Ltd.|25,949,781.00|25,949,781.00|
||Shenzhen Merchants Construction Co., Ltd.|23,307,933.70|28,379,667.10|
||Shenzhen Investment Promotion Real EstateManagement Co., Ltd.|19,636,865.78|18,294,814.64|
|Other payables|China Merchants Financial Leasing (Tianjin) Co., Ltd.|12,500,000.00|-|
||Shenzhen Merchants Commercial Property InvestmentCo., Ltd|9,756,730.13|9,355,392.43|
||Broadford Global Limited|5,675,237.74|-|
||Qingdao Port (Group) Co., Ltd.|2,700,000.00|2,700,000.00|
||Orientrue Holdings Company Limited.|1,924,529.50|-|
||China Merchants Food Co., Ltd.|1,254,271.10|1,254,271.10|
||Modern Terminals Limited|866,514.37|1,286,962.56|
||China Merchants Group Finance Company Limited|630,585.56|1,043,521.17|
||China Merchants Securities Co., Ltd.|424,557.30|22,641,509.43|
||Port de Djibouti S.A.|-|2,951,170.40|
||Other related parties|7,289,221.64|6,336,740.05|
||Total|995,169,627.25|297,361,023.41|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
X RELATED PARTY RELATIONSHIPS AND TRANSACTIONS - continued
6. Amounts due from/to related parties - continued
(2) Amounts due to related parties - continued
RMB
|||||
|-|-|-|-|
|Item|Related parties|Closing balance|Opening balance|
||China Merchants Financial Leasing (Tianjin) Co.,Ltd.|140,653,619.77|-|
||Nanshan Group and its subsidiaries|62,038,387.48|-|
||China Merchants Trading Financial Leasing Co., Ltd.|55,087,516.76|-|
||Shenzhen Merchants Commercial PropertyInvestment Co., Ltd|4,939,825.88|-|
|Non-current liabilities due||||
|within one year||||
||Shenzhen Science and Technology University PhaseII Real Estate Management Co., Ltd|3,189,128.95|-|
||China Merchants Landmark (Shenzhen) Co., Ltd|1,275,330.45|-|
||Other related parties|277,847.90|-|
||Total|267,461,657.19|-|
|Other current liabilities|Port de Djibouti S.A.|-|241,927,341.05|
|Long-term borrowings|China Merchants Group Finance Company Limited|187,000,000.00|135,000,000.00|
||China Merchants Financial Leasing (Tianjin) Co.,Ltd.|558,333,616.48|-|
||China Merchants Trading Financial Leasing Co., Ltd.|189,462,094.28|-|
||Nanshan Group and its subsidiaries|181,020,508.23|-|
|Lease liabilities||||
||Shenzhen Merchants Commercial PropertyInvestment Co., Ltd|2,642,533.00|-|
||China Merchants Landmark (Shenzhen) Co., Ltd|1,167,962.11|-|
||Total|932,626,714.10|-|

 XI COMMITMENTS AND CONTINGENCIES
1. Significant commitments
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Capital commitments that have been entered into but have|||
|not been recognized in the financial statements:|||
|- Commitment to acquisition of long-term assets|5,093,759,934.19|3,971,730,917.34|
|- Commitment to port construction investment|5,499,743.65|5,490,560.00|
|- Capital commitments to investee|6,059,112,802.86|-|
|Others|37,011,622.22|26,115,744.09|
|Total|11,195,384,102.92|4,003,337,221.43|

 2. Contingencies
RMB
||||
|-|-|-|
|Item|Closing balance|Opening balance|
|Contingent liabilities (Note 1)|245,474,295.55|323,559,335.68|
|Guarantees for associates (Note 2)|92,082,086.33|118,629,805.57|
|Total|337,556,381.88|442,189,141.25|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
XI COMMITMENTS AND CONTINGENCIES - continued
2. Contingencies - continued
Note 1: As at 30 June 2019, the TCP Group had significant contingent liabilities arising from pending legal proceedings in Brazil in respect of disputes with local tax authorities, employees or former employees of TCP Group and other parties, amounting to RMB245,474,295.55, which, based on the professional suggestions of lawyers employed and the latest estimates of the management of the Group, is not probable that outflows of resources embodying economic benefits will be required to settle these obligations. Accordingly, no provision for litigation claims in respect of the above cases has been made in the condensed consolidated interim financial information. A counter indemnity in favor of the Group is executed by the Selling Shareholders pursuant to which the latter indemnify to the Group for the above contingent liabilities for and up to predetermined amounts and specified period.
Note 2:As at 30 June 2019, the other shareholder of an associate of which the Group held as to49% of its issued share capital provided corporate guarantees to the full amount for certain loan facilities granted by banks to and other obligations borne by the relevant associate. A counter indemnity in favor of the other shareholder of the associate is executed pursuant to which the Group undertakes to indemnify the other shareholder49% of the liabilities in the aggregate amount of RMB 84,004,318.83 arising from the above loan facilities and other obligations.
In addition to above, the Group also provides guarantees for banking facilities granted to and other obligations borne by associates of the Group. As at 30 June 2019, the total amount guaranteed by the Group is RMB 343,735,000.00 and RMB 197,991,360.00 and the aggregate amount utilized by the relevant associates amounted to RMB 8,077,772.50 and RMB 75,761,819.65 specified in Notes (X) 5.
During the year ended 30 June 2019, the directors assessed the risk of default of the associates in serving the aforesaid loan facilities and other obligations at the end of the reporting period and considered the risk to be insignificant and it is not likely that any guaranteed amount will be claimed.
In addition to above, no material contingencies that should be disclosed by the Group as at 30 June 2019.
XII SIGNIFICANT EVENTS AFTER THE BALANCE SHEET DATE NOT REQUIRED TO BE DISCLOSED BY THE GROUP
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
XIII OTHER SIGNIFICANT EVENTS
1. Segment reporting
(1) Basis for determining and accounting treatments of reporting segments
The key management team of the Company is regarded as the CODM, who reviews the Group's internal reports in order to assess performance, allocate resources and determine the operating segments.
The CODM manages the Group's operations by divisions from both business and geographic perspectives.
From business and financial perspectives, management assesses the performance of the Group's business operations including ports operation, bonded logistics operation, port-related manufacturing operation and other operations.
Ports operation
Ports operation includes container terminal operation, bulk and general cargo terminal operation operated by the Group and its associates and joint ventures.
The Group's reportable segments of the ports operation are as follows:
(a) Mainland China, Hong Kong and Taiwan
 Pearl River Delta
 Yangtze River Delta
 Bohai Rim
 Others
(b) Other locations outside of Mainland China, Hong Kong and Taiwan
Bonded logistics operation
Bonded logistics operation includes logistic park operation, ports transportation and airport cargo handling operated by the Group and its associates.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
XIII OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(1) Basis for determining and accounting treatments of reporting segments - continued Other operations
Other operations mainly includes property development and investment and construction of modular housing operated by the Group's associate, property investment operated by the Group and corporate function.
Each of the segments under ports operation include the operations of a number of ports in various locations within the geographic locations, each of which is considered as a separate operating segment by the CODM. For the purpose of segment reporting, these individual operating segments have been aggregated into reportable segments on geographic basis in order to present a more systematic and structured segment information. To give details of each of the operating segments, in the opinion of the directors of the Company, would result in particulars of excessive length.
Bonded logistics operation and other operations include a number of different operations, each of which is considered as a separate but insignificant operating segment by the CODM. For segment reporting, these individual operating segments have been aggregated according to the natures of their operations to give rise to more meaningful presentation.
There are no material sales or other transactions between the segments.
As at 30 June 2019, around68% of the Group's non-current assets other than financial instruments and deferred tax assets are located in Mainland China.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
XIII OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(2) Segment financial information
Segment financial information for the period from 1 January to 30 June 2019 as following:
RMB
||||||||||||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|||||Ports operation|||||||||||||||||||
|||||Mainland China, Hong Kong and Taiwan||||||||||||Bonded logistics|||||||
||Item|||||||||||||||||Others||Unallocated||Total|
|||||||Yangtze River||||||Other locations||Sub-total||operation|||||||
|||||Pearl River Delta||||Bohai Rim||Others|||||||||||||
|||||||Delta|||||||||||||||||
||Revenue||2,563,053,013.02||-||28,168,987.53||1,397,395,887.11||1,570,327,264.29||5,558,945,151.95||198,548,490.32||76,859,779.06||-||5,834,353,421.33||
||Cost||1,400,422,751.75||-||23,271,714.87||1,159,081,166.62||806,785,348.05||3,389,560,981.29||102,361,806.43||116,097,908.19||-||3,608,020,695.91||
|Sp|egment operating||1,162,630,261.27||-||4,897,272.66||238,314,720.49||763,541,916.24||2,169,384,170.66||96,186,683.89||-39,238,129.13||-||2,226,332,725.42||
||rofit (loss)||||||||||||||||||||||
||Adjustment：||||||||||||||||||||||
|T|axes and levies||14,890,740.27||494,750.94||758,114.34||20,339,076.10||43,955,818.52||80,438,500.17||12,314,880.14||3,352,242.54||369,888.57||96,475,511.42||
||Sales expenses||-||-||-||-||-||-||-||-||-||-||
||Administrative expense|s|161,958,157.61||5,957,946.50||5,186,300.20||185,063,592.36||106,930,776.84||465,096,773.51||19,513,858.09||521,344.15||162,112,742.61||647,244,718.36||
|d|Research and||58,943,160.57||-||-||1,075,674.72||-||60,018,835.29||-||-||-||60,018,835.29||
||evelopment expenses||||||||||||||||||||||
|F|inancial expenses||76,022,722.60||2,384,363.06||-207,723.17||31,431,701.37||195,392,686.45||305,023,750.31||14,138,374.06||18,340,276.72||535,607,223.79||873,109,624.88||
|Ia|mpairment losses of||25,051.16||-||-||-||-||25,051.16||-||-||-||25,051.16||
||ssets||||||||||||||||||||||
|Il|mpairment of credit||8,861,023.97||-||-||-797,113.11||-351,250.43||7,712,660.43||-13,525.65||-||-||7,699,134.78||
||oss||||||||||||||||||||||
||Other income||25,773,703.58||612,499.98||8,502.70||17,999,997.79||-||44,394,704.05||18,613,866.06||-||10,083,935.65||73,092,505.76||
|I|nvestment income||51,868,030.27||1,265,955,033.43||228,896,210.75||739,047,265.17||237,218,340.89||2,522,984,880.51||6,075,215.17||95,989,388.88||-||2,625,049,484.56||
|c|Gains (losses) from||-||415,490,444.53||442,610,832.66||-21,212,710.87||-193,261,253.31||643,627,313.01||-||-||-||643,627,313.01||
||hanges in fair value||||||||||||||||||||||
|a|Gains on disposal of||4,169,659,522.32||-||-||973,603.28||-1,539,758.22||4,169,093,367.38||30,261.24||-||733,537.91||4,169,857,166.53||
||ssets||||||||||||||||||||||
||Operating profit||5,107,002,811.52||1,673,220,917.44||670,676,127.40||736,415,718.20||459,328,713.36||8,646,644,287.92||74,925,388.42||34,537,396.34||-687,272,381.41||8,068,834,691.27||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
XIII OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(2) Segment financial information - continued
Segment financial information for the period from 1 January to 30 June 2019 as following:
RMB
||||||||||||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|||||Ports operation|||||||||||||||||||
|||||Mainland China, Hong Kong and Taiwan||||||||||||Bonded logistics|||||||
||Item|||||||||||||||||Others||Unallocated||Total|
|||||||Yangtze River||||||Other locations||Sub-total||operation|||||||
|||||Pearl River Delta||||Bohai Rim||Others|||||||||||||
|||||||Delta|||||||||||||||||
||Non-operating income||7,963,541.78||-||2,000.00||2,719,861.46||761,782.68||11,447,185.92||288,000.00||593,937.26||2,050,495.16||14,379,618.34||
||Non-operating expense|s|1,265,551.99||-||-||4,472,600.79||1,755,221.51||7,493,374.29||13,000.00||-||-||7,506,374.29||
||Gross profit||5,113,700,801.31||1,673,220,917.44||670,678,127.40||734,662,978.87||458,335,274.53||8,650,598,099.55||75,200,388.42||35,131,333.60||-685,221,886.25||8,075,707,935.32||
|I|ncome tax expenses||1,711,420,860.56||100,891,127.85||115,853,537.85||14,978,469.61||29,679,141.77||1,972,823,137.64||17,268,718.27||5,515,701.82||22,363,192.43||2,017,970,750.16||
||Net profit||3,402,279,940.75||1,572,329,789.59||554,824,589.55||719,684,509.26||428,656,132.76||6,677,774,961.91||57,931,670.15||29,615,631.78||-707,585,078.68||6,057,737,185.16||
|S|egment assets||33,196,909,643.12||26,608,126,967.66||7,195,285,469.79||25,284,919,328.03||42,988,283,698.06||135,273,525,106.66||3,371,658,070.86||11,020,096,484.76||2,071,386,506.80||151,736,666,169.08||
||Total assets in the financial statements||||||||||||||||||||151,736,666,169.08||
|S|egment liabilities||10,239,072,230.76||669,506,616.52||167,677,352.95||8,391,441,943.87||12,290,667,748.90||31,758,365,893.00||836,988,250.90||1,080,991,027.09||28,787,171,870.66||62,463,517,041.65||
||Total liabilities in the financial statements||||||||||||||||||||62,463,517,041.65||
|Si|upplementary||||||||||||||||||||||
||nformation:||||||||||||||||||||||
||Depreciation and||445,342,347.68||-||1,022,915.06||420,194,355.28||389,441,606.07||1,256,001,224.09||40,232,719.84||87,403,323.30||9,878,481.58||1,393,515,748.81||
||Amortization||||||||||||||||||||||
|I|nterest income||14,165,690.17||128,798.24||429,528.28||43,375,879.83||41,816,130.28||99,916,026.80||347,467.83||871,700.32||38,218,626.51||139,353,821.46||
|I|nterest expense||87,432,544.23||1,534,287.59||-||93,809,754.62||219,801,956.40||402,578,542.84||14,424,783.67||18,413,158.96||602,538,812.83||1,037,955,298.30||
|Ifi|nvestment income|y|51,868,030.09||1,227,729,204.60||160,833,782.63||16,239,015.82||237,218,340.89||1,693,888,374.03||6,075,215.17||95,989,388.88||-||1,795,952,978.08||
||rom long-term equity||||||||||||||||||||||
||nvestment under equit||||||||||||||||||||||
||method||||||||||||||||||||||
|Li|ong-term equity|y|2,568,638,767.30||23,627,207,421.38||5,844,260,986.81||690,179,027.12||10,947,192,719.42||43,677,478,922.03||333,730,254.55||5,090,055,370.08||-||49,101,264,546.66||
||nvestment under equit||||||||||||||||||||||
||method||||||||||||||||||||||
|oe|Non-current assets||20,182,701,629.65||293,990,172.93||28,036,062.49||21,919,860,061.35||28,217,823,022.70||70,642,410,949.12||2,719,940,706.98||5,487,649,639.57||447,672,714.64||79,297,674,010.31||
||ther than long-term||||||||||||||||||||||
||quity investment||||||||||||||||||||||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
XIII OTHER SIGNIFICANT EVENTS - continued
1. Segment reporting - continued
(2) Segment financial information - continued
The Group's revenue by geographical areas of operations and information about its non-current assets other than financial instruments and deferred tax assets presented based on the geographical areas in which the assets are located as follows:
RMB
||||||
|-|-|-|-|-|
|||Amount incurred in the||Amount incurred in the|
|Revenue from external transactions|||||
|||current period||previous period|
|Mainland China, Hong Kong and Taiwan|4,260,737,809.93||3,252,292,659.03||
|Pearl River Delta|2,770,970,075.39||2,801,848,271.82||
|Yangtze River Delta|-||-||
|Bohai Rim|1,144,618,922.64||83,692,475.07||
|Others|345,148,811.90||366,751,912.14||
|Other locations|1,573,615,611.40||1,420,045,381.69||
|Total|5,834,353,421.33||4,672,338,040.72||

 RMB
||||||
|-|-|-|-|-|
|Non-current assets||Closing balance||Opening balance|
|Mainland China, Hong Kong and Taiwan|87,455,212,809.70||73,602,488,004.01||
|Pearl River Delta|35,375,049,007.32||33,618,069,629.60||
|Yangtze River Delta|23,921,197,594.31||23,299,884,544.83||
|Bohai Rim|6,453,927,519.65||6,316,574,360.92||
|Others|21,705,038,688.42||10,367,959,468.66||
|Other locations|40,943,725,747.27||40,685,665,029.47||
|Total|128,398,938,556.97||114,288,153,033.48||

 (3) Degree of reliance on major customers
The total operating income derived from the top five clients of the Group is RMB
1,623,483,231.87, occupying27.83% of the Group's total operating income.
2. Lease
Undiscounted lease receivable subsequent to the balance sheet date:
|||
|-|-|
|Undiscounted lease receivable|30/6/2019|
|1st year subsequent to the balance sheet date|176,584,535.06|
|2nd year subsequent to the balance sheet date|141,398,138.24|
|3rd year subsequent to the balance sheet date|112,169,964.84|
|4th year subsequent to the balance sheet date|79,064,480.80|
|5th year subsequent to the balance sheet date|70,999,663.62|
|6th year subsequent to the balance sheet date and|241,225,930.51|
|subsequent periods||
|Total|821,442,713.07|

Note: During the period from January 1 to June 30, 2019, the rental income was RMB
76,859,779.06; there was no income related to the variable lease payments that were not
included in the lease receivables.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
XIV NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS 1. Accounts receivable
(1) Accounts receivable
(a) Disclosure of accounts receivable by categories
RMB
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
||E|xpected credit loss rat|e||Closing balance|||||
|Categories||||||||||
|||(%)|||Carrying amount||Provision||Book value|
|A||0.00-0.10||19,010,075.81||-||19,010,075.81||
|B||0.10-0.30||-||-||-||
|C||0.30-50.00||-||-||-||
|D||50.00-100.00||-||-||-||
|Total||||19,010,075.81||-||19,010,075.81||

 (b) As at 30 June 2019, the company has no actual write-off of accounts receivable.
(c) The top five balances of accounts receivable classified by debtor
RMB
|||||
|-|-|-|-|
||||Proportion of the|
||||amount to the total|
|Name of customer|Amount|Aging||
||||accounts receivable|
||||(%)|
|Client F|8,007,807.39|Within 1 year|42.12|
|Client G|3,096,885.40|Within 1 year|16.29|
|Client H|1,926,327.49|Within 1 year|10.13|
|Client I|1,860,980.18|Within 1 year|9.79|
|Client J|1,540,313.37|Within 1 year|8.10|
|Total|16,432,313.83||86.43|

 2. Other receivables
(1) Summary of other receivables
RMB
||||||
|-|-|-|-|-|
|Item||Closing balance||Opening balance|
|Interest receivable|-||-||
|Dividends receivable|1,050,790,853.94||329,153,465.74||
|Other receivables|278,813,217.11||321,896,767.34||
|Total|1,329,604,071.05||651,050,233.08||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
XIV NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS - continued
2. Other receivables - continued
(2) Interest receivable
As at 30 June 2019, the Group has no significant overdue interest.
(3) Dividend receivable
(a) Disclosure of dividend receivable by categories
RMB
||||||
|-|-|-|-|-|
|Entities||Closing balance||Opening balance|
|Dongguan Chiwan Wharf Co., Ltd. ("DGW")|103,355,370.74||103,355,370.74||
|CHCC|-||96,378,106.61||
|DGT|88,196,930.66||88,196,930.66||
|Shenzhen Chiwan Tugboat Co., Ltd|-||21,929,842.24||
|CMBL|15,707,120.00||15,707,120.00||
|Shenzhen Chiwan Port Development Co., Ltd.|-||3,299,252.31||
|Shenzhen Chiwan International Freight Agency Co., Ltd.|-||286,843.18||
|China Merchants Port Holdings Co., Ltd.|843,531,432.54||-||
|Total|1,050,790,853.94||329,153,465.74||
|Net: provision of credit loss|-||-||
|Book value|1,050,790,853.94||329,153,465.74||

 (b) Significant dividend receivable aging more than one year
||||||||
|-|-|-|-|-|-|-|
|Item||Closing balance||Outstanding Reason||Provision or not|
|Dongguan Chiwan Wharf|103,355,370.74||Working on and expected to be received bythe end of 2019||No||
|Co., Ltd. ("DGW")|||||||
||88,196,930.66||Working on and expected to be received bythe end of 2019||No||
|DGT|||||||

(4) Other receivables
(a) Disclosure of other receivables by categories
As a part of cooperate credit risk management, the company rank the credit risk of its client, and determine theaverage expected loss rate of each internal credit rating level. These average expected loss rates are determined by considering the historical actual loss and the current and future economic situation.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
XIV NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS - continued
2. Other receivables - continued
(4) Other receivables - continued
(a) Disclosure of other receivables by categories - continued
As at 30 June 2019, the credit risk and expected credit loss of other receivables of each category of customers are presented as below:
RMB
|||||||||||
|-|-|-|-|-|-|-|-|-|-|
|||Expected||Closing balance||||||
|Internal credit rating||Loss||Expected credit|Lifetime expected credit||Lifetime expected credit|||
||||||||||Total|
|||Rate (% )||loss in 12 months|loss (not credit-impaired)||loss (credit-impaired)|||
|A|0.00-0.10||278,813,217.11||-|-||278,813,217.11||
|B|0.10-0.30||-||-|-||-||
|C|0.30-50.00||-||-|-||-||
|D|50.00-100.00||-||-|383,456.60||383,456.60||
|Carrying amount|||278,813,217.11||-|383,456.60||279,196,673.71||
|Provision of credit loss|||-||-|383,456.60||383,456.60||
|Book value|||278,813,217.11||-|-||278,813,217.11||

 (b) Changes in provision for credit loss of other receivables
RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
||||Amount incurred in the current period||||||
||Aging||Expected credit loss in 12|Lifetime expected credit loss||Lifetime expected credit loss|||
|||||||||Total|
||||months|(not credit-impaired)||(credit-impaired)|||
|3|1 December 2018|-||-|383,456.60||383,456.60||
|Pf|rovision for expected credit loss|-||-|-||-||
||or the period||||||||
|t|Reversal of expected credit loss for|-||-|-||-||
||he period||||||||
|Ec|ffect of changes in the scope of|-||-|-||-||
||onsolidation||||||||
|Ee|ffect of changes in foreign|-||-|-||-||
||xchange||||||||
|3|0 June 2019|-||-|383,456.60||383,456.60||

 (c) Disclosure of other receivables by nature
RMB
||||||
|-|-|-|-|-|
|Item||Closing balance||Opening balance|
|Amounts due from related parties|273,500,000.00||316,567,355.24||
|Temporary payments|2,898,097.38||4,785,167.82||
|Deposits|374,358.71||372,042.31||
|Others|2,424,217.62||555,658.57||
|Total|279,196,673.71||322,280,223.94||
|Net: provision of credit loss|383,456.60||383,456.60||
|Book value|278,813,217.11||321,896,767.34||

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
XIV NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS - continued
2. Other receivables - continued
(4) Other receivables - continued
(d) There is no other receivables write-off during this year.
(e) The top five balances of other receivables classified by debtor
RMB
|||||||
|-|-|-|-|-|-|
|||||Proportion of the|Closing balance|
|Entities|Nature of the fund|Closing balance|Aging|amount to the total|of provision for|
|||||other receivable (%)|credit loss|
||Loan to relatedparties|139,000,000.00|Within 1 year|49.79|-|
|DGT||||||
|Dongguan Chiwan Wharf Co.,|Loan to relatedparties|134,500,000.00|Within 1 year|48.17|-|
|Ltd. ("DGW")||||||
||Temporarypayments|2,993,398.32|Within 1 year, more than1 year but not exceeding2 years and more than 3years|1.07|-|
|Chiwan Wharf Holdings (Hong||||||
|Kong) Limited||||||
||Temporarypayments|736,080.69|Within 1 year|0.26|-|
|CCT||||||
||Temporarypayments|320,239.46|Within 1 year|0.11|-|
|CHCC||||||
|Total||277,549,718.47||99.40|-|

CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
XIV NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS - continued
3. Long-term equity investments
RMB
||||||||||||||||||||||||||||
|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|-|
|||||||Changes|||||||||||||||||||||
||||||||||||||Reconciling item|s||||||||||||Closing balance of|
||Investees|||Opening balance||||||Investment incom|e||from other|||Other equity||Cash dividends or||Provision for||||Closing balance||provision for|
|||||||Increase||Decrease||under equity|||comprehensive|||movements||profits announced||impairment||Others||||impairment|
|||||||||||method|||income|||||of issuance|||||||||
|I.|Subsidiaries||||||||||||||||||||||||||
|S|henzhen Chiwan International Freight||5,500,000.00||-||-||-|||-|||-||-||-||-||5,500,000.00||-||
||Agency Co., Ltd.||||||||||||||||||||||||||
|C|HCC||250,920,000.00||-||-||-|||-|||-||-||-||-||250,920,000.00||-||
|S|henzhen Chiwan Port Development Co.,||7,000,000.00||10,825,000.00||-||-|||-|||-||-||-||-||17,825,000.00||-||
||Ltd.(Note)||||||||||||||||||||||||||
|C|hiwan Wharf Holdings (Hong Kong)||1,070,000.00||-||-||-|||-|||-||-||-||-||1,070,000.00||-||
||Limited||||||||||||||||||||||||||
|S|henzhen Chiwan Tugboat Co., Ltd||24,000,000.00||-||-||-|||-|||-||-||-||-||24,000,000.00||-||
|C|CT||421,023,199.85||-||-||-|||-|||-||-||-||-||421,023,199.85||-||
|D|ongguan Chiwan Wharf Co., Ltd. ("DGW"|)|186,525,000.00||-||-||-|||-|||-||-||-||-||186,525,000.00||-||
|D|GT||175,000,000.00||-||-||-|||-|||-||-||-||-||175,000,000.00||-||
|C|hiwan Shipping (Hong Kong) Limited||1,051,789.43||-||-||-|||-|||-||-||-||-||1,051,789.43||-||
|C|hina Merchants Port Holdings Co., Ltd.||26,170,129,771.99||-||-||-|||-|||-||-||-||-||26,170,129,771.99||-||
|C|hina Merchants Port (Zhoushan) Roller||149,709,800.00||-||-||-|||-|||-||-||-||-||149,709,800.00||-||
||Loading Logistics Co., Ltd.||||||||||||||||||||||||||
|S|ubtotal||27,391,929,561.27||10,825,000.00||-||-|||-|||-||-||-||-||27,402,754,561.27||-||
|II|. Associates||||||||||||||||||||||||||
|C|hina Merchants Holdings (International)||18,274,568.38||-||-||1,153,368.00|||-|||-||-||-||-||19,427,936.38||-||
||Information Technology Co., Ltd.||||||||||||||||||||||||||
|C|MBL||340,500,382.73||-||-||14,804,000.00|||-|||-||-||-||-||355,304,382.73||-||
|S|ubtotal||358,774,951.11||-||-||15,957,368.00|||-|||-||-||-||-||374,732,319.11||-||
|II|I. Joint ventures||||||||||||||||||||||||||
|C|hina Overseas Harbour Affairs (Laizhou)||793,557,064.58||-||-||21,889,138.83|||-|||-||43,605,689.02||-||-||771,840,514.39||-||
||Co., Ltd.||||||||||||||||||||||||||
|T|otal||28,544,261,576.96||10,825,000.00||-||37,846,506.83|||-|||-||43,605,689.02||-||-||28,549,327,394.77||-||

 Note: On 19 April 2019,25% shares of Shenzhen Chiwan Port Development Co., Ltd. (formerly known as "Shenzhen Chiwan Transportation Co., Ltd.") held by Chiwan Wharf Holdings (Hong Kong) Limited were transferred to the Company at the consideration of RMB 10,825,000.00.
CHINA MERCHANTS PORT GROUP CO., LTD.
NOTES TO FINANCIAL STATEMENTS
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
XIV NOTES TO THE KEY ITEMS IN THE COMPANY'S FINANCIAL STATEMENTS - continued
4. Operating income and operating costs
RMB
||||||||||
|-|-|-|-|-|-|-|-|-|
|||Amount incurred in the current period||||Amount incurred in the previous period|||
|Item|||||||||
|||Income||Cost||Income||Cost|
|Principal operating|75,059,363.04||71,586,188.10||106,838,899.78||66,399,384.51||
|Other operating|14,717,425.25||552,302.90||12,584,077.69||504,701.81||
|Total|89,776,788.29||72,138,491.00||119,422,977.47||66,904,086.32||

 5. Investment income
(1) Details of investment income
RMB
||||
|-|-|-|
||Amount incurred in the|Amount incurred in the|
|Item|||
||current period|previous period|
|Income from long-term equity investments under cost method|948,667,473.38|-|
|Income from long-term equity investments under equity|37,846,506.83|37,627,300.00|
|method|||
|Income from Other investments in equity instruments|-|7,788,975.00|
|Total|986,513,980.21|45,416,275.00|

 (2) Income from long-term equity investments under cost method
RMB
||||||||
|-|-|-|-|-|-|-|
|||Amount incurred||Amount incurred||Reasons for increases or|
|Investee||in the current||in the previous||decreases in the current|
|||period||period||compared to the prior period|
||105,136,040.84||-||The profits distributed byinvestee fluctuate||
|CCT|||||||
|China Merchants Port Holdings Co.,|843,531,432.54||-||The profits distributed byinvestee fluctuate||
|Ltd.|||||||
|Total|948,667,473.38||-||||

CHINA MERCHANTS PORT GROUP CO., LTD.
SUPPLEMENTARY INFORMATION
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
1. BREAKDOWN OF EXTRAORDINARY GAINS AND LOSSES
RMB
||||
|-|-|-|
|Item|Amounts|Remarks|
|Gains or losses on disposal of non-current assets|4,169,857,166.53||
|Tax refunds or reductions with ultra vires approval or without official approval|-||
|documents|||
|Government grants recognized in profit or loss (except for grants that are closely|73,405,505.76||
|related to the Company's business and are in amounts and quantities fixed in|||
|accordance with the national standard)|||
|Money lending income earned from non-financial institutions in profit or loss|25,804,391.08||
|The excess of attributable fair value of identifiable net assets over the|-||
|consideration paid for subsidiaries, associates and joint ventures|||
|Gains or losses on exchange of non-monetary assets|-||
|Gains or losses on entrusted investments or assets management|-||
|Provision of impairment losses for each asset due to force majeure, e.g. natural|-||
|disasters|||
|Gains or losses on debt restructuring|-||
|Business restructuring expenses, e.g., expenditure for layoff of employees,|-||
|integration expenses, etc.|||
|Gains or losses relating to the unfair portion in transactions with unfair transaction|-||
|price|||
|Net profit or loss of subsidiaries recognized as a result of business combination of|-||
|enterprises under common control from the beginning of the period up to the|||
|business combination date|||
|Gains or losses arising from contingencies other than those related to normal|-||
|operating business|||
|Gains or losses on changes in the fair value of financial assets and financial|643,627,313.01||
|liabilities held for trading and investment income on disposal of held-for-trading|||
|financial assets, held-for-trading financial liabilities and available-for-sale|||
|financial assets, other than the effective hedging activities relating to normal|||
|operating business|||
|Reversal of provision for accounts receivable that are tested for credit loss|876,952.77||
|individually|||
|Gains or losses on entrusted loans|-||
|Gains or losses on changes in the fair value of investment properties that are|-||
|subsequently measured using the fair value model|||
|Effects on profit or loss of one-off adjustment to profit or loss for the period|-||
|according to the requirements by tax laws and accounting laws and regulations|||
|Custodian fees earned from entrusted operation|-||
|Other non-operating income or expenses other than above|6,560,244.05||
|Other profit or loss that meets the definition of non-recurring profit or loss(Note)|722,688,249.35||
|Tax effects|-1,208,157,505.65||
|Effects of minority interest (after tax)|-2,704,886,316.38||
|Total|1,729,776,000.52||

Note: The amount is mainly due to profit or loss arising from the fair value adjustment of the original long term investment of Zhanjiang Port (Group) Co., Ltd.
CHINA MERCHANTS PORT GROUP CO., LTD.
SUPPLEMENTARY INFORMATION
FOR THE PERIOD FROM 1 JANUARY TO 30 JUNE 2019
2. RETURN ON NET ASSETS AND EARNINGS PER SHARE ("EPS")
The return on net assets and EPS have been prepared by Shenzhen Chiwan Wharf Co., Ltd. in accordance with Information Disclosure and Presentation Rules for Companies Making Public Offering No. 9 - Calculation and Disclosure of Return on Net Assets and Earnings per Share (revised in 2010) issued by China Securities Regulatory Commission.
RMB
||||||||
|-|-|-|-|-|-|-|
|||Weighted average||EPS|||
|Item||return on net assets|||||
|||||Basic EPS||Diluted EPS|
|||(%)|||||
|Net profit for the current period attributable to ordinary|7.2441||1.2820||1.2820||
|shareholders|||||||
|Net profit attributable to ordinary shareholders after|1.7940||0.3175||0.3175||
|deducting extraordinary gains and losses|||||||