(a joint stock company incorporated in the People’s Republic of China with limited liability)
Stock Code: 1812
2025
INTERIM REPORTI Important Notice Table of Contents and Definitions
The board of directors (the “Board”) the supervisory committee (the “Supervisory Committee”) and the directors (the “Directors”)
supervisors (the “Supervisors”) and senior management (the “Senior Management”) of the Company hereby warrant the truthfulness
accuracy and completeness of the contents of the interim report guarantee that there are no false representations misleading
statements or material omissions contained in this interim report and are jointly and severally responsible for the liabilities of the
Company.Hu Changqing head of the Company Dong Lianming head in charge of accounting and Zhang Bo head of the accounting
department (Accounting Officer) declare that they warrant the truthfulness accuracy and completeness of the financial report in the
interim report.All Directors have attended the board meeting to review this report. This interim report has been reviewed by the audit committee of
the Company.The Company is exposed to various risk factors such as macro-economic fluctuation adjustment of state policy and competition in
the industry. Investor should be aware of investment risks. For further details please refer to the risk exposures of the Company and
the measures to be taken to address them as set out in Management Discussion and Analysis.The Company does not propose distribution of cash dividends or bonus shares and there will be no increase of share capital from
reserves.SHANDONG CHENMING PAPER HOLDINGS LIMITED 1
INTERIM REPORT 2025I Important Notice Table of Contents and Definitions
Table of Contents
I Important Notice Table of Contents and Definitions 1
II Company Profile and Key Financial Indicators 5
III Management Discussion and Analysis 8
IV Corporate Governance Environment and Society 32
V Material Matters 41
VI Changes in Share Capital and Shareholders 63
VII Bonds 71
VIII Financial Report 72
2 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025I Important Notice Table of Contents and Definitions
Documents Available for Inspection
(I) The financial statements signed and sealed by the head of the Company the head in charge of accounting and the head of
the accounting department;
(II) the interim report signed by the legal representative;
(III) the original copies of all of the documents and announcements of the Company disclosed on the designated website as
approved by the China Securities Regulatory Commission during the reporting period;
(IV) the interim report disclosed on The Stock Exchange of Hong Kong Limited; and
(V) other relevant information.SHANDONG CHENMING PAPER HOLDINGS LIMITED 3
INTERIM REPORT 2025I Important Notice Table of Contents and Definitions
Definitions
Item Definition
Company Group Chenming Group means Shandong Chenming Paper Holdings Limited and its subsidiaries
Chenming Paper or Chenming
Paper Company
Parent Company or Shouguang means Shandong Chenming Paper Holdings Limited
Headquarters
Chenming Holdings means Chenming Holdings Company Limited
Shenzhen Stock Exchange means Shenzhen Stock Exchange
Hong Kong Stock Exchange means The Stock Exchange of Hong Kong Limited
CSRC means China Securities Regulatory Commission
Shandong CSRC means Shandong branch of China Securities Regulatory Commission
Zhanjiang Chenming means Zhanjiang Chenming Pulp & Paper Co. Ltd.Jiangxi Chenming means Jiangxi Chenming Paper Co. Ltd.Huanggang Chenming means Huanggang Chenming Pulp & Paper Co. Ltd.Chenming (HK) means Chenming (HK) Limited
Jilin Chenming means Jilin Chenming Paper Co. Ltd.Shouguang Meilun means Shouguang Meilun Paper Co. Ltd.Jiangxi Port means Jiangxi Chenming Port Co. Ltd.Chenming Leasing means Shandong Chenming Financial Leasing Co. Ltd. and its subsidiaries
reporting period means the period from 1 January 2025 to 30 June 2025
the beginning of the year means 1 January 2025
or the period
the end of the interim period means 30 June 2025
or the period
4 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025II Company Profile and Key Financial Indicators
I. Company profile
Stock abbreviation ST晨鳴 Stock code 000488
ST晨鳴 B 200488
Stock exchanges on which the shares are listed Shenzhen Stock Exchange
Stock abbreviation Chenming Paper Stock code 01812
Stock exchanges on which the shares are listed The Stock Exchange of Hong Kong Limited
Name in Chinese of the Company 山東晨鳴紙業集團股份有限公司
Short name in Chinese of the Company 晨鳴紙業
Name in English of the Company SHANDONG CHENMING PAPER HOLDINGS LIMITED
Short name in English of the Company SCPH
Legal representative of the Company Hu Changqing
II. Contact persons and contact methods
Secretary to the Board Representatives for Security Affairs Hong Kong Company Secretary
Name Yuan Xikun Zhang Chuanyong Chen Lin Chu Hon Leung
Email address chenmmingpaper@163.com friend537@163.com ZQCL0536@163.com liamchu@li-partners.com
Correspondence No. 2199 Nongsheng East Road No. 2199 Nongsheng East Road 22nd Floor World Wide House
Address Shouguang City Shandong Province Shouguang City Shandong Province Central Hong Kong
Telephone 0536-2158008 0536-2158008 00852-21629600
Facsimile 0536-2158977 0536-2158977 00852-25010028
III. Other information
1. Contact methods of the Company
Whether the registered address office address postal code website email and others of the Company changed during
the reporting period
□ Applicable □ Not applicable
There was no change of the registered address office address postal code website email and others of the Company
during the reporting period. Please refer to the 2024 annual report for details.
2. Information disclosure and places for inspection
Whether the information disclosure and places for inspection changed during the reporting period
□ Applicable □ Not applicable
There was no change of the websites of the stock exchanges and the names and websites of the media where the
Company discloses its interim report and places for inspection of the Company’s interim report during the reporting
period. Please refer to the 2024 annual report for details.
3. Other relevant information
Whether other relevant information changed during the reporting period
□ Applicable □ Not applicable
SHANDONG CHENMING PAPER HOLDINGS LIMITED 5
INTERIM REPORT 2025II Company Profile and Key Financial Indicators
IV. Major accounting data and financial indicators
Retrospective adjustment to or restatement of the accounting data for prior years by the Company
□ Yes □ No
Increase/decrease
for the reporting
period as compared
The corresponding to the corresponding
period of period of
The reporting period the prior year the prior year
Revenue (RMB) 2106630952.30 13884731519.04 -84.83%
Net profit attributable to shareholders of the Company (RMB) -3857953190.56 28646205.42 -13567.59%
Net profit after extraordinary gains or losses attributable to
shareholders of the Company (RMB) -3645363615.81 -270865043.51 -1245.82%
Net cash flows from operating activities (RMB) 785303274.19 1992499393.07 -60.59%
Basic earnings per share (RMB per share) -1.31 0.01 -13200.00%
Diluted earnings per share (RMB per share) -1.31 0.01 -13200.00%
A decrease of 53.56
Weighted average return on net assets -53.39% 0.17% percentage points
Increase/decrease as
at the end of the
reporting period as
As at the end of As at the end of compared to the
the reporting period the prior year end of the prior year
Total assets (RMB) 54698875991.74 63509295142.08 -13.87%
Net assets attributable to shareholders of the Company (RMB) 5318763216.33 9156104358.91 -41.91%
V. Differences in accounting data under domestic and overseas accounting standards
1. Differences between the net profit and net assets disclosed in accordance with international accounting
standards and China accounting standards in the financial report
□ Applicable □ Not applicable
There was no difference between the net profit and net assets disclosed in accordance with international accounting
standards and China accounting standards in the financial report during the reporting period.
2. Differences between the net profit and net assets disclosed in accordance with overseas accounting
standards and China accounting standards in the financial report
□ Applicable □ Not applicable
There was no difference between the net profit and net assets disclosed in accordance with overseas accounting
standards and China accounting standards in the financial report during the reporting period.
6 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025II Company Profile and Key Financial Indicators
VI. Items and amounts of extraordinary gains or losses
□ Applicable □ Not applicable
Unit: RMB
Item Amount Description
Profit or loss from disposal of non-current assets (including write-off of provision
for assets impairment) -97049878.76
Government grants (except for the government grants closely related to the
normal operation of the Company granted in accordance with an established
standard and having an ongoing effect on the Company’s profit or loss in
compliance with national policies and regulations) accounted for in profit or
loss for the current period 25503367.73
Except for effective hedging business conducted in the ordinary course of
business of the Company gain or loss arising from the change in fair value of
financial assets and financial liabilities held by a non-financial company as
well as gain or loss arising from disposal of its financial assets and financial
liabilities 8439571.88
Reversal of provision for impairment of receivables individually tested for
impairment 13201496.76
Profit or loss from debt restructuring -37171293.24
Profit or loss from changes in the fair value of consumable biological assets
subsequently measured at fair value -129059190.34
Other non-operating income and expenses other than the above items -18188031.78
Less: Effect of income tax 2948680.16
Effect of minority interests (after tax) -24683063.16
Total -212589574.75
Details of other gain or loss items that fall within the definition of extraordinary gain or loss:
□ Applicable □ Not applicable
The Company did not have details of other gain or loss items that fall within the definition of extraordinary gain or loss.Explanation on the extraordinary gain or loss items as illustrated in the Explanatory Announcement on Information Disclosure
for Companies Offering Their Securities to the Public No.1 – Extraordinary Gains or Losses defined as its recurring gain or loss
items
□ Applicable □ Not applicable
Item Amount involved (RMB) Reason
Other income 24301996.32 Government grants related to assets that are closely related to the
Company’s normal operations are subsequently amortised to other
income which has a continuing effect on the Company’s profit or loss
and is therefore accounted for as recurring profit or loss.SHANDONG CHENMING PAPER HOLDINGS LIMITED 7
INTERIM REPORT 2025III Management Discussion and Analysis
I. Principal activities of the Company during the reporting period
1. Industry Situation
The paper industry is an important basic industry of the national economy and an industry that guarantees people’s
livelihood. It has the characteristics of a technology-capital-resource intensive industry. Its product applications
penetrate all aspects of social and economic activities. They are deeply integrated into the defence and military industry
(special functional materials) cultural communication (publishing and printing) industrial and agricultural production
(supporting materials) modern logistics (packaging products) and other key areas of the national economy and are
closely related to residents’ daily consumption. The paper industry as a typical cyclical industry is closely tied to the
overall state of the economy. The paper industry as a typical cyclical industry is closely tied to the overall state of the
economy. The consumption level of paper and paperboard has become one of the important indicators to measure a
country’s level of modernisation and civilised development and is widely recognised by the international community as
a “social and economic barometer”.In recent years the contradiction between supply and demand has been prominent due to the concentration of new
production capacity in the paper industry coming into production and the weakened support from end-user demand.In the first half of 2025 new production capacity in the paper industry in China gradually came into production leading
to a continuous increase in supply. The structural imbalance between supply and demand persisted resulting in a
significant decline in market prices for machine-made paper products such as culture paper and white cardboard.Meanwhile although the prices of raw materials such as wood chips and pulp decreased the decline in operating
costs lagged behind the drop in revenue making it difficult to effectively pass on cost pressures further squeezing
profit margins leading to growth falling short of expectations. According to the data released by the National Bureau of
Statistics from the perspective of price performance the producer prices for industrial products (PPI): manufacture of
paper and paper products continued its downward trend in June 2025 with a cumulative year-on-year decline of 3.2%.From the perspective of raw material costs the purchasing price index for manufactured goods: timber and paper
pulp stood at 96.9 from January to June 2025 representing a year-on-year decrease of 3.1% which was smaller than
the decline in the producer prices indicating weakened cost-side support for paper products and further pressure on
market prices. From January to June 2025 among industrial enterprises above the designated size nationwide revenue
of the manufacture of paper and paper products amounted to RMB681.21 billion representing a year-on-year decline
of 2.3% the operating costs amounted to RMB601.73 billion representing a year-on-year decline of 2.1% and the total
profit amounted to RMB17.57 billion representing a year-on-year decline of 21.4%. The decline in revenue was greater
than the decline in operating costs and the total profit declined significantly year on year.In the medium to long term the outlook for the paper industry is expected to improve due to the dual forces of the
deepening implementation of the “dual carbon” strategic goals and the policy aiming at curbing “rat race competition”
coupled with the ongoing improvement of the domestic economic circulation system and the gradual recovery of
the domestic market. The new national standard which has been implemented since May 2025 has strengthened
energy consumption restrictions for various types of paper which significantly raises energy consumption limits for
existing production capacity and includes auxiliary and ancillary production systems within the scope of statistics.The implementation of this standard substantially increases environmental compliance costs for outdated production
capacity and accelerate the phasing out of high energy consuming and inefficient equipment. It is worth noting that
on 25 June 2025 the Shanghai Futures Exchange issued a public consultation announcement regarding the futures
contracts options contracts and business rules for offset paper and on 1 July the sixth meeting of the CentralCommission for Financial and Economic Affairs explicitly called for “governing enterprises’ disorderly low-pricecompetition in accordance with laws and regulations guiding enterprises to improve product quality and promoting theorderly exit of outdated production capacity” which will gradually improve the industry self-discipline mechanism and
further optimise the market environment. Under the combined effect of policy guidance and the market mechanism
the paper industry will see accelerated elimination of outdated production capacity undergo profound supply-side
restructuring sustain capacity structure optimisation and achieve further market concentration. Meanwhile with the
continued implementation of national policies aiming at expanding domestic demand expectations for improvements in
the demand side of the paper industry have strengthened and overall operating performance is expected to gradually
improve.
8 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025III Management Discussion and Analysis
I. Principal activities of the Company during the reporting period (Cont'd)
2. Business overview of the Company
The Company is a large modern conglomerate principally engaged in pulp production and paper making and committed
itself to implementing a pulp and paper integration strategy. The Company has production bases in Shandong
Guangdong Hubei Jiangxi Jilin and other places and is the first domestic paper making enterprise that achieves a
balance between pulp production and paper making capacity. Its machine-made paper products cover more than 200
types in seven series including culture paper coated paper white cardboard copy paper industrial paper special
paper and household paper. It is the enterprise with the largest variety of products and the most complete products in
the domestic paper industry. During the reporting period the machine-made paper business was the major source of
revenue and profit of the Company.During the reporting period the Company’s certain production lines at Zhanjiang Jilin and Shouguang production
bases were still in shutdown and maintenance resulting in a year-on-year decline in production and sales volumes
which in turn led to a decrease in revenue and profit. Due to the impact of the shutdown and maintenance the
Company made provisions for impairment and bad debts on certain assets and receivables which resulted in lower
profitability. From January to June 2025 the revenue of the Company amounted to RMB2107 million and net loss
attributable to shareholders of the Company amounted to RMB3858 million. During the Reporting Period the Company
proactively took measures to improve its ability to continue as a going concern. By fully leveraging the shutdown period
for equipment maintenance and upgrading equipment integrity and operational efficiency were enhanced. For the
production lines that had resumed operation and production the Company adopted whole process control over the
procurement of raw materials cost savings quality improvement and many other respects. The Company made huge
efforts in cash flow and expense management to gradually restore its profitability. At the same time the Company
actively strengthened communication with financial institutions and implemented relevant work on maturity extension
and interest rate reduction to further alleviate the operational burden on the Company. With the strong support of
government authorities and financial institutions at all levels the Company will remain committed to securing working
capital through multiple channels and continue to advance the resumption of operation and production at each
production base in line with the capital position and market conditions thus achieving sustainable and stable operation
of the Company.SHANDONG CHENMING PAPER HOLDINGS LIMITED 9
INTERIM REPORT 2025III Management Discussion and Analysis
I. Principal activities of the Company during the reporting period (Cont'd)
3. Major products and their application
The Company attaches great importance to technology research and development. Focusing on key areas of green
papermaking technology the Company has a number of domestically leading innovative R&D platforms including a
national enterprise technology centre a post-doctoral working station a collaborative innovation centre for cleaner
production and refinery of light industry bio-based products and the Shandong Pulp and Paper Making Engineering
Lab in order to promote standardised production optimise its product structure and increase brand benefits.Major brands of machine-made paper products of the Company and their applications are set out below:
Major
manufacturing
Category Major brands and types companies Range of application
Culture paper series 1. “BIYUNTIAN” “CLOUDY MIRROR” “CLOUDY Shouguang Printing publications textbooks magazinesLEOPARD” and “YUNJIN” all-wood pulp offset Headquarters covers illustrations notebooks test papers
paper and electrostatic base paper Shouguang Meilun teaching materials reference books etc.
2. “CLOUDY LION” and “CLOUDY CRANE” original Zhanjiang Chenming
white offset paper Jiangxi Chenming
3. “CLOUDY PINE” and “GREEN PINE” light weight Jilin Chenming
paper
4. Blueprint paper colour offset paper pure texture
paper non-fluorescent offset paper PE offset
paper
5. Beige and high white book paper
6. Light weight coated paper
Coated paper series 1. “SNOW SHARK” and “EAGLE” one-sided coated Shouguang Double-sided coated paper is suitable for
paper Headquarters high quality printing such as high-grade
2. “SNOW SHARK” “EAGLE” and “RABBIT” double- Shouguang Meilun picture albums picture magazines and so
sided coated paper on promotional materials such as interior
3. “EAGLE” and “RABBIT” matte coated paper pages of high-end books wall calendars
posters and so on and suitable for suitable
for high-speed sheet printing and high-speed
rotary printing;
One-sided coated paper is suitable for
upscale tobacco package paper adhesive
sticker shopping bags slipcases envelopes
gift wrapping and so on and suitable for large
format printing and commercial printing.
10 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025III Management Discussion and Analysis
I. Principal activities of the Company during the reporting period (Cont'd)
3. Major products and their application (Cont'd)
Major
manufacturing
Category Major brands and types companies Range of application
White cardboard 1. White cardboard of “LIYA” series white cardboard Shouguang High-end gift boxes cosmetics boxes tags
series and ivory cardboard of “LIPIN” and “POPLAR” Headquarters shopping bags publicity pamphlets high-
series high bulk cardboard and ivory cardboard of Jiangxi Chenming end postcards; cigarette package printing
“LIZZY” and “BAIYU” series and super high bulk Zhanjiang Chenming of medium and high quality; milk package
cardboard of “LIYING” and “BAIYU” series beverage package disposable paper cups
2. Food package board of “LIYA” and “LIZZY” series milk tea cups and noodle bowls.
3. Coated cattle card and LIYA book card
4. Playcard paper board
5. Chenming cigarette cardboard
Copy paper series “GOLDEN MINGYANG” and “GOLDEN CHENMING” Shouguang Printing and copying business documents
copy paper “BOYA” and “BIYUNTIAN” copy paper Headquarters training materials and writing.“MINGYANG” “LUCKY CLOUDS” “BOYANG” and Shouguang Meilun
“SHANYIN” copy paper and “GONGHAO” and Zhanjiang Chenming
“TIANJIAN” copy paper
Industrial paper High-grade yellow anti-sticking base paper ordinary Shouguang Anti-stick base paper is mainly used for
series yellow/white anti-sticking base paper and PE paper Headquarters producing the paper base of stripping paper
Jiangxi Chenming or anti-sticking base paper;
Zhanjiang Chenming Cast coated base paper is suitable for
producing adhesive paper or playcard
compound paper after coating.Special paper series Thermal paper and glassine paper Shouguang Art Paper High-grade adhesive backing paper for
electronics medicine food washing supplies
supermarket labels double-sided tapes etc.Household paper Toilet paper facial tissue pocket tissue napkin paper Shouguang Meilun Daily toilet supplies; used in restaurants and
series towels and “XINGZHILIAN” other catering industries and used in public
toilets in hotels guesthouses and office
buildings and also suitable for home and
other environment.SHANDONG CHENMING PAPER HOLDINGS LIMITED 11
INTERIM REPORT 2025III Management Discussion and Analysis
II. Analysis of liquidity financial resources and capital structure disclosed in accordance with the
listing rules of Hong Kong Stock Exchange
As at 30 June 2025 the Group’s current ratio was 23.72%. The quick ratio was 17.34%. The gearing ratio (i.e. total liabilities
divided by total assets) was 85.93%.There was no significant seasonal trend for capital requirements of the Group.The Group’s sources of capital primarily came from cash inflow generated from operating activities and borrowings from
financial institutions.As at 30 June 2025 the total bank borrowings of the Group were RMB29103 million (as at the end of the prior year: the total
bank borrowings of the Group was RMB32752 million). As at 30 June 2025 the Group had monetary funds of RMB954 million
(as at the end of the prior year: RMB5910 million) in total (For the breakdown of monetary funds please refer to VIII. VII. 1
Note on Monetary Funds in this report).Due to the shutdown and maintenance of certain production bases the Group’s liquidity and solvency were constrained. As
of the date of this report a syndicated loan of RMB2.31 billion specifically for resuming production has been approved. The
Company will successively resume production of its production bases based on its cash flow and market conditions. As at 30
June 2025 the Group had 9095 employees. The total staff remuneration for the first half of 2025 amounted to RMB432.1004
million (The Group had 9594 employees in 2024. The total staff remuneration for 2024 amounted to RMB1144.3267 million).There will be no major investment project of the Company during the second half of 2025.The Company’s existing bank deposits were primarily used for production and operation equipment maintenance and
investment in technology research and developments.For details of the assets with restricted ownership of the Group as at 30 June 2025 please refer to VIII. VII. 24. Details of
assets with restricted ownership or right to use in this report.
12 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025III Management Discussion and Analysis
III. Analysis of Core Competitiveness
After innovation and development for more than 60 years the Company has created a strong brand influence and cultivated
a solid comprehensive competitiveness. It promotes product upgrades enhances R&D strength and improves core
competitiveness by creating competitive advantages in an industry chain featured with pulp and paper integration. The details
of the core competitiveness of the Company during the reporting period are as follows:
1. Advantages of pulp and paper integration
The Company has unwaveringly implemented a pulp and paper integration strategy. At present its major production
bases located in Shouguang Zhanjiang and Huanggang are equipped with chemical pulp production lines. It is the
first modern large-scale paper making company that basically realises wood pulp self-sufficiency in China. A complete
supply chain not only creates cost advantage for the Company but also safeguards the safety stability and quality of
upstream raw materials and renders strong support for the Company to maintain its long-term competitiveness.
2. Scale advantages
The paper industry is a typical capital-intensive and technology-intensive industry that follows the laws of economies of
scale. The Company’s large-scale production bases can be found in the major markets in Southern Central Northern
and Northeast China where reasonable production scale creates the marginal cost advantage. Meanwhile by leveraging
the scale advantages the Company has built an international logistics centre and railway dedicated lines and docks
and constructed a comprehensive logistics service platform covering container shipping bonded warehousing transfer
and storage at stations and terminals realising the improvement of logistics efficiency and the stability of logistics costs.
3. Product advantages
The Company is an enterprise that offers the widest and the most complete product range in the paper industry in
China. The product series include culture paper white cardboard coated paper copy paper household paper thermal
paper etc. The Company has attached great importance to technology research and development. By introducing the
most advanced pulping and paper making technology and equipment in the world it persists in technological innovation
and work process optimisation so as to help improve product quality and structure upgrade continuously improve the
brand value of Chenming and enhance brand benefits.
4. Industry layout advantages
Closely centring on the pulp and paper integration strategy the Company has integrated resources and established
its production bases in the core target market to promote the coordinated development of all regions. Currently the
Company adopts the market-oriented approach and has production bases in Shandong Guangdong Hubei Jiangxi
Jilin and other places. With all products sold at close distances the Company substantially reduces transportation costs
while improving service efficiency achieving a “win-win” between the Company and its users.
5. Advantages in technical equipment
The Company highly values the introduction and upgrades of technical equipment actively push equipment and
technology upgrade forward and boasts the largest and most advanced pulping and paper making production line in the
world. The Company’s major production equipment has been imported from internationally renowned manufacturers
including Metso and Valmet of Finland Voith of Germany Andritz of Austria etc. and reached the advanced international
level thus ensuring production efficiency and product quality.SHANDONG CHENMING PAPER HOLDINGS LIMITED 13
INTERIM REPORT 2025III Management Discussion and Analysis
III. Analysis of Core Competitiveness (Cont'd)
6. Advantages in research and innovation
The Company has scientific research institutions including a national enterprise technology centre a post-doctoral
working station a collaborative innovation centre for cleaner production and refinery of light industry bio-based
products and the Shandong Pulp and Paper Making Engineering Lab. At the same time the Company actively carries
out in-depth industry-university-research cooperation with prestigious domestic universities and research institutes
continuously improves technical innovation capabilities and scientific research and development levels and develops
a series of new products with high technology contents and high added value as well as proprietary technologies.The Company and its subsidiaries Zhanjiang Chenming Shouguang Meilun Jiangxi Chenming Jilin Chenming and
Huanggang Chenming are high and new technology enterprises. As at the end of the reporting period the Company
had obtained more than 480 national patents including 45 invention patent authorisation 7 national new products 16
scientific and technological progress awards above the provincial level 5 national scientific and technological projects
and 75 provincial-level technological innovation projects. The Company took the lead in obtaining the ISO9001 quality
system certification the ISO14001 environmental protection system certification and the FSC-COC international forest
system certification among domestic peers.
7. Advantages in environmental governance capacity
The Company has actively upheld the concept of “lucid waters and lush mountains are invaluable assets” adhered to
the development idea of “placing green development and environmental protection as its priority” always regarded
environmental protection as the “life project” clung to the green development model of clean production and resource
recycling and earnestly shouldered the corporate responsibility for environmental protection. In recent years the
Company and its subsidiaries have invested more than RMB8 billion in total in environmental protection and have
constructed the pollution treatment facilities including the alkali recovery system reclaimed water treatment system
reclaimed water reuse system white water recovery system and black liquor comprehensive utilisation system. The
environmental protection indicators rank high in China and in the world. At present the Company adopts the world’s
most advanced “ultrafiltration membrane + reverse osmosis membrane” technology to complete the reclaimed water
recycling membrane treatment project which is the largest reclaimed water reuse project in the domestic paper industry.The reclaimed water recycle rate attains the industry-leading level. Meanwhile in response to the “dual carbon” policy
the Company actively introduces photovoltaic power generation and biomass power generation continuously optimises
the energy structure and improves the level of low-carbon production.
14 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025III Management Discussion and Analysis
IV. Analysis of principal operations
Overview
Please see “I. Principal activities of the Company during the Reporting Period” for relevant information
Year-on-year changes in major financial information
Unit: RMB
Increase/
The corresponding decrease
The reporting period period of the prior year year on year Reason for the change
Revenue 2106630952.30 13884731519.04 -84.83% Mainly due to the shutdown and maintenance of
certain production bases and a decrease in sales
volume of machine-made paper resulting in a
decrease in revenue during the reporting period.Operating costs 3727203720.24 12185505709.00 -69.41% Mainly due to the shutdown and maintenance of
certain production bases and a decrease in sales
volume of machine-made paper resulting in a year-
on-year decrease in cost during the reporting period.Taxes and surcharges 61186804.84 116747402.65 -47.59% Mainly due to the year-on-year decrease in land use
tax and stamp duty during the reporting period.Research and development 36567185.69 611914096.41 -94.02% Mainly due to the shutdown and maintenance of
expense certain production bases resulting in a decrease in
research and development investment during the
reporting period.Sales and distribution 51113266.56 99303831.21 -48.53% Mainly due to the year-on-year decrease in salary and
expenses expenses during the reporting period.Other income 22794816.03 159945128.64 -85.75% Mainly due to the year-on-year decrease in additional
deduction of value-added input tax and gain on debt
restructuring during the reporting period.Investment income -430669782.44 181332096.11 -337.50% Mainly due to the year-on-year decrease in investment
income from investees and investment income from
disposal of equity recognised during the reporting
period.Gain on change in fair value -129487561.79 -2221596.44 -5728.58% Mainly due to the year-on-year increase in the loss
on change in fair value of forestry assets during the
reporting period.Credit impairment loss -506322424.22 -124386619.66 307.06% Mainly due to the year-on-year increase in bad debt
provisions for receivables during the reporting period.SHANDONG CHENMING PAPER HOLDINGS LIMITED 15
INTERIM REPORT 2025III Management Discussion and Analysis
IV. Analysis of principal operations (cont'd)
Year-on-year changes in major financial information (cont'd)
Increase/
The corresponding decrease
The reporting period period of the prior year year on year Reason for the change
Loss on impairment of -240561409.32 -3041427.75 7809.49% Mainly due to the year-on-year increase in impairment
assets provisions for equipment during the reporting period.Gain on disposal of assets -9814609.63 19222812.60 -151.06% Mainly due to the year-on-year decrease in the gain
on disposal of fixed assets during the reporting
period.Non-operating expenses 26198489.55 1013551.00 2484.82% Mainly due to the increase in litigation expenses and
loss on retirement of non-current assets during the
reporting period.Income tax expenses 3603600.91 -96400954.34 103.74% Mainly due to the reversal of deferred income
tax assets arose from the deductible losses and
deductible temporary differences recognised in
prior periods by certain companies reversing in the
previous period during the reporting period.Net cash flows from 785303274.19 1992499393.07 -60.59% Mainly due to the decrease in sales revenue as a
operating activities result of the decrease in sales volume during the
reporting period.Net cash flows from -493454488.13 571305188.14 -186.37% Mainly due to the repurchase of a portion of the equity
investing activities interest in subsidiaries held by minority shareholders
during the reporting period and the proceeds received
from the sale of the equity interest in subsidiaries in
the corresponding period of the prior year.Net cash flows from -379851423.55 -2547689483.86 85.09% Mainly due to the interest rate reductions extensions
financing activities and renewals of maturing loans by major financial
institutions during the reporting period.Significant change in structure or source of profit of the Company during the reporting period
□ Applicable □ Not applicable
There was no significant change in structure or source of profit of the Company during the reporting period.
16 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025III Management Discussion and Analysis
IV. Analysis of principal operations (cont'd)
Components of revenue
Unit: RMB
The corresponding period Increase/
The reporting period of the prior year decrease
Item Amount % of revenue Amount % of revenue year on year
Total revenue 2106630952.30 100% 13884731519.04 100% -84.83%
By industry
Machine-made paper 1121420145.71 53.23% 12429565296.10 89.52% -90.98%
Chemical pulp 740160267.96 35.13% 676203401.45 4.87% 9.46%
Electricity and steam 98222594.99 4.66% 123938936.52 0.89% -20.75%
Hotel and property rentals 73374807.43 3.48% 93524660.28 0.67% -21.54%
Construction materials 2779445.82 0.13% 87284048.72 0.63% -96.82%
Chemicals 104714.25 0.02% 54442131.87 0.39% -99.81%
Others 70568976.14 3.35% 419773044.10 3.03% -83.19%
By product
Coated paper 322730071.72 15.32% 2407591953.96 17.34% -86.60%
White cardboard 260654282.46 12.37% 2926439060.82 21.08% -91.09%
Duplex press paper 213202847.01 10.12% 3710036202.61 26.72% -94.25%
Anti-sticking raw paper 179939410.52 8.54% 569577140.37 4.10% -68.41%
Other machine-made paper 144893534.00 6.88% 2815920938.34 20.28% -94.85%
Chemical pulp 740160267.96 35.13% 676203401.45 4.87% 9.46%
Electricity and steam 98222594.99 4.66% 123938936.52 0.89% -20.75%
Hotel and property rentals 73374807.43 3.48% 93524660.28 0.67% -21.54%
Construction materials 2779445.82 0.13% 87284048.72 0.63% -96.82%
Chemicals 104714.25 0.02% 54442131.87 0.39% -99.81%
Others 70568976.14 3.35% 419773044.10 3.03% -83.19%
By geographical segment
Mainland China 2075083434.21 98.50% 11052530679.12 79.60% -81.23%
Other countries and regions 31547518.09 1.50% 2832200839.92 20.40% -98.89%
Industries products or regions accounting for over 10% of revenue or operating profit of the Company
□ Applicable □ Not applicable
SHANDONG CHENMING PAPER HOLDINGS LIMITED 17
INTERIM REPORT 2025III Management Discussion and Analysis
IV. Analysis of principal operations (cont'd)
Components of revenue (cont'd)
Unit: RMB
Increase/ Increase/
Increase/ decrease of decrease of
decrease of operating gross profit
revenue as costs as margin as
compared to the compared to the compared to the
corresponding corresponding corresponding
Gross profit period of the period of period of
Item Revenue Operating costs margin prior year the prior year the prior year
By industry
Machine-made paper 1121420145.71 2643006731.03 -135.68% -90.98% -75.98% -147.16%
Chemical pulp 740160267.96 741869112.58 -0.23% 9.46% 32.66% -17.53%
By product
Coated paper 322730071.72 332541676.98 -3.04% -86.60% -82.48% -24.20%
White cardboard 260654282.46 290140269.06 -11.31% -91.09% -90.52% -6.75%
Duplex press paper 213202847.01 248067568.05 -16.35% -94.25% -92.32% -29.33%
Chemical pulp 740160267.96 741869112.58 -0.23% 9.46% 32.66% -17.53%
By geographical segment
Mainland China 2075083434.21 3638208196.02 -75.33% -81.23% -61.69% -89.40%
Under the circumstances that the statistics specification for the Company’s principal operations data experienced adjustment
in the reporting period the principal activity data upon adjustment of the statistics specification as at the end of the reporting
period in the latest year
□ Applicable □ Not applicable
18 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025III Management Discussion and Analysis
V. Analysis of non-principal operations
□ Applicable □ Not applicable
Unit: RMB
As a percentage
Amount of total profit Reason Sustainable or not
Other income 22794816.03 -0.55% Receipt of government grants Including RMB52 million the
related to daily business activities annual amortisation amount of
and profit or loss from debt government grants received in prior
restructuring. periods and sustainable in nature.Investment income -430669782.44 10.30% Recognition of external investment No
income as well as income from
equity disposal and derecognition
of financial assets during the
reporting period.Gain or loss arising from the change -129487561.79 3.10% Fluctuations of fair values of the No
in fair value shares of China Bohai Bank as well
as forestry assets.Credit impairment loss -506322424.22 12.11% Bad debt provisions for No
receivables.Loss on impairment of assets -240561409.32 5.75% Impairment provisions for non- No
current assets.Non-operating expenses 26198489.55 -0.63% All expenses not directly related to No
the Company’s daily production
and business operations.SHANDONG CHENMING PAPER HOLDINGS LIMITED 19
INTERIM REPORT 2025III Management Discussion and Analysis
VI. Analysis of assets and liabilities
1. Material changes of asset items
Unit: RMB
As at the end of the reporting period As at the end of the prior year
As a As a
percentage of percentage of Percentage
Amount total assets Amount total assets change Description
Monetary funds 953661496.60 1.74% 5909879812.18 9.31% -7.57% Mainly due to a decrease in guarantee deposits as at
the end of the reporting period.Accounts receivables 930731502.52 1.70% 1384290313.70 2.18% -0.48% Mainly due to a decrease in receivables from customers
as at the end of the reporting period.Long-term equity investments 3621265404.11 6.62% 3971035411.54 6.25% 0.37% Mainly due to a decrease in investment income from
investees recognised during the reporting period.Other non-current 344266989.06 0.63% 751030454.68 1.18% -0.55% Mainly due to the fact that Weifang Chenchuang Equity
financial assets Investment Fund Partnership (Limited Partnership)
was included in the scope of consolidation during the
reporting period.Bills payable 107370000.00 0.20% 1423918112.99 2.24% -2.04% Mainly due to the overdue bills being reclassified to
accounts payable and short-term borrowings as at the
end of the reporting period.Accounts payable 8426902071.31 15.41% 7708967406.47 12.14% 3.27% Mainly due to the overdue commercial paper being
reclassified to accounts payable as at the end of the
reporting period.Other payables 3560628293.65 6.51% 2896409953.94 4.56% 1.95% Mainly due to an increase in trade payables and
accrued expenses as at the end of the reporting period
compared to the beginning of the year.
20 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025III Management Discussion and Analysis
VI. Analysis of assets and liabilities (Cont'd)
1. Material changes of asset items (Cont'd)
As at the end of the reporting period As at the end of the prior year
As a As a
percentage of percentage of Percentage
Amount total assets Amount total assets change Description
Non-current liabilities 2534511114.58 4.63% 1577936964.14 2.48% 2.15% Mainly due to an increase in long-term liabilities
due within one year reclassified to due within one year as at the end of the
reporting period.Other current liabilities 844340067.04 1.54% 2680562600.58 4.22% -2.68% Mainly due to certain equipment finance lease
transactions being extended and reclassified to long-
term payables as at the end of the reporting period.Long-term payables 2544988247.10 4.65% 774965008.29 1.22% 3.43% Mainly due to certain equipment finance lease
transactions being extended and reclassified to long-
term payables as at the end of the reporting period.
2. Major assets overseas
□?Applicable □ Not applicable
3. Assets and liabilities measured at fair value
□ Applicable □?Not applicable
Unit: RMB
Profit or loss Cumulative fair Impairment Amount Amount
from change value change provided acquired disposed
in fair value charged during during of during Other Closing
Item Opening balance during the period to equity the period the period the period changes balance
Financial assets
1. Held-for-trading financial assets
(excluding derivative financial assets) 37259325.70 -428371.45 -159902790.79 -138544.52 36692409.73
2. Other non-current financial assets 751030454.68 30221725.86 -406763465.62 344266989.06
3. Consumable biological assets
measured at fair value 1256379773.85 -129059190.34 -245710144.48 12056839.46 40598820.66 1098778602.31
Total 2044669554.23 -129487561.79 -375391209.41 – 12056839.46 40598820.66 -406902010.14 1479738001.10
Whether there were any material changes on the measurement attributes of major assets of the Company during the
reporting period
□?Yes □ No
SHANDONG CHENMING PAPER HOLDINGS LIMITED 21
INTERIM REPORT 2025III Management Discussion and Analysis
VI. Analysis of assets and liabilities (Cont'd)
4. Restriction on asset rights as at the end of the reporting period
Unit: RMB
As at the end of the period As at the beginning of the period
Type of Type of
Item Book balance Book value restriction Restriction Book balance Book value restriction Restriction
Fixed assets 34753954012.60 19712891634.14 Charged As co l la te ra l fo r bank 34375256421.29 20001586415.43 Charged A s c o l l a t e r a l f o r b a n k
borrowings and long-term borrowings and long-term
payables payables
Investment 6556109499.47 5195027744.73 Charged As co l la te ra l fo r bank 6742657317.44 5433525500.09 Charged A s c o l l a t e r a l f o r b a n k
properties borrowings borrowings
Intangible assets 1842713402.08 1328582983.12 Charged As co l la te ra l fo r bank 1789243785.12 1312981381.52 Charged A s c o l l a t e r a l f o r b a n k
borrowings and long-term borrowings and long-term
payables payables
Long-term equity 1653602939.71 1649407876.62 Frozen Frozen due to being sued 1549103158.31 1549103158.31 Frozen Frozen due to being sued for
investments for arrears arrears
Monetary funds 875404665.38 875404665.38 Pledged A s d e p o s i t s f o r b a n k 5728747806.12 5728747806.12 Pledged A s d e p o s i t s f o r b a n k
frozen acceptance bil ls letter frozen acceptance bills letter of
of credit loans deposit credit letter of guarantee
reserves or frozen accounts loans depos i t rese rves
and frozen by litigation o r f rozen accoun ts and
etc. interest receivable frozen by
litigation etc.Inventories 20028521.46 14865436.95 Seized by Seized due to being sued 120195864.99 103566055.40 Seized by Seized due to being sued for
court for arrears court arrears
Accounts 207017962.56 206147426.74 Pledged As collateral for borrowings
receivables
Total 45701813040.70 28776180340.94 50512222315.83 34335657743.61
22 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025III Management Discussion and Analysis
VII. Analysis of investments
1. Overview
□ Applicable □ Not applicable
Investments during the
corresponding period of
Investments during the reporting period (RMB) prior year (RMB) Change
646248442.8018000000.003490.27%
2. Material equity investments acquired during the reporting period
□ Applicable □ Not applicable
Unit: RMB
Progress
as at the Profit or loss
date of from Date of
Form of Investment Source Period of Product balance Estimated investment Involvement disclosure Disclosure
Name of investee Principal activities investment amount Shareholding of fund Partner(s) Investment type sheet return for the period in lawsuit if any Index if any
Weifang Engage in investment Merger 512000000.00 99.67% Self-owned Subsidiary Long-term Investment Completed N/A 626.63 No N/A N/A
Chenchuang activities with self- and funds
Equity Investment owned funds acquisition
Fund Partnership
(Limited
Partnership)
Shandong Sales of paper and Capital 98500000.00 100.00% Self-owned Subsidiary Long-term Trading Completed N/A -30348394.39 No N/A N/A
Chenming Paper pulp increase funds
Sales Co. Ltd.Shouguang Production of Merger 35748442.80 100.00% Self-owned Subsidiary Long-term Production Completed N/A -66979940.94 No N/A N/A
Chenming Art machine-made and funds
Paper Co. Ltd. paper acquisition
T otal － － 6 46248442.80 － － － － － － -97327708.70 － － －
3. Material non-equity investments during the reporting period
□ Applicable □ Not applicable
SHANDONG CHENMING PAPER HOLDINGS LIMITED 23
INTERIM REPORT 2025III Management Discussion and Analysis
VII. Analysis of investments (Cont'd)
4. Financial asset investment
(1) Security investments
□ Applicable □ Not applicable
Unit: RMB
Profit or loss Cumulative Amount Amount Book value
Accounting Book value at the from change in fair value acquired disposed of Profit or loss as at the end of
Stock Abbreviation of Initial measurement beginning of the fair value during change charged during during the during the the reporting Source
Type of security code stock name investment cost model reporting period the period to equity the period period reporting period period Accounting item of fund
Domestic 09668 China Bohai Bank 195684817.15 Measured at fair value 37259325.70 -428371.45 -159902790.79 0.00 0.00 -566915.97 36692409.73 Held-for-trading Self-owned
and foreign financial assets funds
shares
Total 195684817.15 － 37259325.70 -428371.45 -159902790.79 0.00 0.00 -566915.97 36692409.73 － －
Disclosure date of announcement in relation to the consideration and approval of securities investments by the Board 20 June 2020
Disclosure date of announcement in relation to the consideration and approval of securities investments by N/A
the shareholders’ general meeting (if any)
(2) Derivative investments
□ Applicable □ Not applicable
The Company did not have any derivative investments during the reporting period.
5. Use of proceeds
□ Applicable □ Not applicable
The Company did not use any proceeds during the reporting period.
24 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025III Management Discussion and Analysis
VIII. Disposal of material assets and equity interest
1. Disposal of material assets
□ Applicable □ Not applicable
Net profit Carried out
contribution to Net profit Relationship Relevant on schedule
the Company from contribution to Pricing with creditors’ or not if not
the beginning of the Company on basis Related counterparty(ies) Relevant rights and the reasons
Transaction the period up to Effect of equity disposal of disposal party (applicable to asset title fully debts fully and measures
Assets Disposal consideration the disposal date disposal on as a percentage of equity transaction related party transferred transferred taken by the Disclosure Disclosure
Counterparty(ies) disposed of date (RMB’0000) (RMB’0000) the Company of total net profit interest or not transactions) or not or not Company date index
Zhejiang Exheng 22 properties June 2025 8591.60 -6514.33 Facilitating the Company 1.56% Market price No N/A Yes Yes Yes N/A N/A
Real Estate Co. in Fatum to integrate resources
Ltd. Apartment opt imis ing i ts asset
structure concentrating
its strengths focusing
on core business and
improving quality and
efficiency.
2. Disposal of material equity interest
□ Applicable □ Not applicable
SHANDONG CHENMING PAPER HOLDINGS LIMITED 25
INTERIM REPORT 2025III Management Discussion and Analysis
IX. Analysis of major subsidiaries and investees
□ Applicable □ Not applicable
Major subsidiary and investees accounting for over 10% of the net profit of the Company
Unit: RMB
Type of
Name of company company Principal activities Registered capital Total assets Net assets Revenue Operating profit Net profit
Zhanjiang Chenming Pulp & Subsidiary Production and sale 6913572423.00 17837776517.63 6881696853.57 143191538.56 -956012412.30 -844270649.67
Paper Co. Ltd. of duplex press paper
electrostatic paper and
white cardboard etc.Shouguang Meilun Paper Co. Ltd. Subsidiary Production and sale of 4801045519.00 13489027547.87 7053307921.36 805084480.98 -836167663.19 -677427573.67
coated paper culture
paper household paper
and chemical pulp
Acquisition and disposal of subsidiaries during the reporting period
□ Applicable □ Not applicable
Methods to acquire and
dispose of subsidiaries Impact on overall production and
Name of company during the reporting period operation and results
Chenming International Trade Import and Export Newly established Nil
Co. Limited
Shouguang Wei Yuan Logistics Company Limited Transfer Net profit increased by RMB166400
Weifang Chenchuang Equity Investment Merger and acquisition Net profit increased by RMB600
Fund Partnership (Limited Partnership)
26 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025III Management Discussion and Analysis
X. Structured entities controlled by the Company
□ Applicable □ Not applicable
XI. Risk factors of the Company and the measures to be taken
1. Macroeconomic and policy risk
The paper industry is a basic raw materials industry thus is being supported by national industry policies. Relevant
competent departments issued a series of relevant policies and regulations including the Policy on the Development
of the Paper Industry aiming to improve industry structure enhance product technology standard energy saving and
emission reduction as well as eliminate outdated production capacity. With the continuous economic development in
China the policies on the paper industry may further adjust in the future. In addition the fiscal and financial policies
bank interest rate import and export policy and other policies may be adjusted in the future. All the above industrial
policies and related policy adjustments will have an impact on the Company’s operation and development.In response to the above risks the Company will pay close attention to the national industrial policy and focus on
its principal activities of pulp production and paper making. The Company will strive to its innovation-driven strategy
comprehensively optimise the industrial structure and regional layout and establish a coordinated and efficient
industry system to respond to the risks arising from industrial policy adjustments. At the same time the Company will
continuously improve its lean management broaden financing channels control costs and optimise its capital structure
thus improving its operating quality to cope with the risks arising from adjustments of other macroeconomic policies
such as fiscal and financial policies.
2. Environmental protection risk
Developing a green paper industry has been the strategic direction of transformation and upgrading in the industry. In
recent years guided by the national “double carbon” goal environmental protection policies have become increasingly
stringent. The Guiding Opinions on Accelerating the Establishment and Improvement of a Green Low-Carbon and
Cyclical Economic System the Opinions on Accelerating the High-Quality Development of the Manufacturing Services
Industry the “14th Five-Year Plan” and the Medium and Long-term High-quality Development Outline of the Paper
Industry and other policy documents have been issued one after another. In particular the Norm of Energy Consumption
Per Unit Product of Pulp and Paper (GB31825-2024) which officially came into effect on 1 May 2025 further clarifies
the technical standards and requirements for energy conservation and emission reduction in the industry and
encourage the paper industry to pursue circular low-carbon and green development. With the continuous improvement
in environmental protection standards enterprises have been increasing their investments in pollution control clean
production and other areas which will lead to a rise in operating costs in the short term.In response to the aforesaid risks the Company reinforces the implementation of the national “double carbon”strategy. The Company adheres to the development idea of “placing green development and environmental protectionas its priority”. The Company widely adopts new technologies for energy saving and emission reduction conducts
clean production and strives to achieve its waste emission target. The Company adopts the world’s most advanced
“ultrafiltration membrane + reverse osmosis membrane” technology to complete the reclaimed water recycling
membrane treatment project. The reclaimed water recycle rate reaches more than 75%. The reclaimed water quality
meets drinking water standards. At the same time the Company actively explores the comprehensive utilisation of
innovative resources and industrial recycling development models and built a circular economy ecological chain of
“resources-products-renewable resources” thereby promoting the coordinated and mutual advancement of corporate
sustainable development and ecological environmental protection.SHANDONG CHENMING PAPER HOLDINGS LIMITED 27
INTERIM REPORT 2025III Management Discussion and Analysis
XI. Risk factors of the Company and the measures to be taken (Cont'd)
3. Risk of price fluctuation of raw materials
The major raw materials of the paper industry are wood pulp and wood chips. China’s wood resources are relatively
limited and the dependence on wood pulp and wood chips is high which makes the development of the paper industry
subject to fluctuations in the international price of wood pulp and wood chips. If the price of raw materials fluctuates
sharply it will bring uncertainty to the control of production costs of papermaking enterprises which will affect the
business performance of enterprises.In response to the aforesaid risks the Company adheres to the strategic layout of the whole pulp and paper integrated
industry chain and has wood pulp production lines in Shouguang Zhanjiang Huanggang and other production bases
ensuring the stability of upstream raw materials. At the same time the Company has established a more comprehensive
supply chain management mechanism practiced source procurement closely followed the price trends of the raw
materials market and improved its market research and judgment ability in order to minimise the impact of fluctuations
in raw material prices on the Company.
4. Risk of intensifying market competition
Although the paper industry has accelerated the elimination of outdated production capacity after several rounds of
environmental protection policies the industry structure has been optimised with a further improved concentration.However there remains the phenomena of a large number of enterprises structural and staged overcapacity of some
products a large number of mid – and low-end products and product homogeneity. During the reporting period
affected by factors such as supply shocks and weak demand the prices of machine-made paper especially white
cardboard declined year on year and market competition further intensified.In response to the aforesaid risks the Company continues to promote technological innovation and continuously
improves its production equipment processing design and process levels in order to realise lean production improve
product quality and create brand benefits. At the same time based on the market conditions the Company produces
marketable products to meet the diverse needs striving to form a high-quality refined special differentiated and
personalised product structure increase the added value of products and improve the level of corporate profitability.
5. Capital risk
The paper industry is capital-intensive. In recent years the industry has seen concentrated capacity expansion
insufficient downstream demand and prominent supply-demand imbalances. The prices of major paper products
especially white cardboard have continued to decline leading to reduced profitability for paper enterprises. For
enterprises with high debt levels scenarios such as loan delays by financial institutions or withdrawals of strategic
investors during industry downturns may result in temporary liquidity shortages leading to debt defaults account
freezes litigations and other issues that could impact their production and operation.To address these risks the Company focuses on its principal responsibilities and operations makes every effort to
revitalise and dispose of its existing assets and strengthens the disposal of assets in its non-principal business and the
efforts to recover outstanding debts striving to improve its liquidity. It actively strengthens communication with financial
institutions pursues debt restructuring and implements relevant work on maturity extension and interest rate reduction
in order to alleviate the operational burden on the Company. The Company is committed to securing working capital
through multiple channels and continues to advance the normal production at each production base in line with the
capital position and market conditions. It accelerates internal management adjustments and optimisations facilitates
corporate reform and innovation and leverages its basic strengths in order to achieve sustained and stable operations.
28 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025III Management Discussion and Analysis
XI. Risk factors of the Company and the measures to be taken (Cont'd)
6. Risk of the financial leasing business
The Company may suffer from loss if the lessees of its financial leasing business cannot make full rental payment on
time due to any reason. The Company will also make bad debt provision as required under its accounting policy. If such
amounts cannot be recovered on time the Company may be exposed to risk of bad debts.At present the Company focuses on the development of its principal activities i.e. pulp production and paper making
and continues to reduce the size of the financial leasing business. As at the end of the reporting period the balance of
financial leases of Chenming Leasing decreased to RMB4.5 billion of which RMB3.7 billion was overdue principal. The
Company made bad debt provisions for certain financial leasing receivables out of prudence for which provisions of
RMB2.0 billion were made in aggregate with a provision coverage rate of 45%. Certain assets were subject to seizure
through litigation. The Company has resorted to among other things control of the underlying assets litigation for
seizure recovery for guarantors and debt reconstruction to mitigate relevant risks.XII. Development and implementation of a market value management system and a valuation
enhancement plan
Whether the Company has developed a market value management system
□ Yes □ No
To effectively strengthen market value management as a listed company further standardise market value management
practices fully safeguard the legitimate rights and interests of the Company investors and other stakeholders and response
to the encouragement under the Guidelines No. 10 for the Regulation of Listed Companies — Market Value Management
for listed companies to establish a market value management system the Company has formulated the Market Value
Management System of Shandong Chenming Paper Holdings Limited in accordance with the Company Law of the People’s
Republic of China the Securities Law of the People’s Republic of China the Rules Governing the Listing of Stocks on
Shenzhen Stock Exchange and other relevant laws and regulations which was considered and approved at the twelfth
meeting of the tenth session of the Board held on 31 March 2025. For details please refer to the Market Value Management
System of Shandong Chenming Paper Holdings Limited disclosed on CNINFO on 1 April 2025 and the overseas regulatory
announcement disclosed on the website of Hong Kong Stock Exchange on 31 March 2025.Whether the Company has disclosed a valuation enhancement plan
□ Yes □ No
To enhance the Company’s investment value and shareholder returns promote a reasonable reflection of the Company’s
intrinsic value in investment value boost investor confidence safeguard the interests of all shareholders and facilitate
high-quality development of the Company the Valuation Enhancement Plan of Shandong Chenming Paper Holdings Limited
was considered and approved at the twelfth meeting of the tenth session of the Board held by the Company on 31 March
2025. The specific measures under the Valuation Enhancement Plan are as follows:
SHANDONG CHENMING PAPER HOLDINGS LIMITED 29
INTERIM REPORT 2025III Management Discussion and Analysis
XII. Development and implementation of a market value management system and a valuation
enhancement plan (Cont'd)
(I) Financial optimisation
1. Debt restructuring: The Company will take the initiative to communicate with its creditors for extension of loan
terms and reduction of interest rates so as to alleviating the pressure on loan repayment in the short term.Provincial debt committees were established to agree on no loan cancellations or delays and further negotiate
new credit facilities in the form of a syndicated loan specifically for resumption of operation and production
and interest rate reductions and extensions of debts to ensure sufficient liquidity for operations and production
resumption of the Company.
2. Asset disposal: The Company will make every effort to revitalise and dispose of its existing assets. The Company
will strengthen the disposal of assets in its non-principal business establish an asset management centre adjust
and optimise internal management divide asset disposal management areas by region and assign responsibilities
to individuals to improve the efficiency of asset disposal. The Company will also step up efforts to recover
outstanding debts and pursue debtors with realisable assets through negotiation or legal means. For accounts
receivable that are difficult to recover the Company will resort to judicial channels to resolve the issues and
striving to improve its liquidity.
3. Cost control: The Company will strengthen internal management streamline production processes and reduce
costs in raw material procurement energy consumption and labour. For example the Company will secure
favourable procurement prices via long-term and stable cooperation with suppliers and adopts advanced
production equipment and technology to boost productivity and lower per-unit production costs.(II) Business optimisation
1. Productivity recovery and adjustment: The Company will accelerate the resumption of production at Shouguang
Zhanjiang Jilin and other key production bases striving to achieve resumption of work and production as soon as
possible to improve operating cash flow. The Company will adjust its product mix according to changes in market
demand by reducing excess production capacity and increasing production focus on high-value-added products
such as special paper to improve profitability.
2. Technological innovation and R&D: The Company will increase investment in the R&D of green paper products and
special paper production technologies to develop new products with strong market competitiveness. Leveraging
its advantages of “pulp and paper integration” the Company will develop pulp and paper products with greater
environmental benefits and high performance so as to meet the market demand for green and environmentally
friendly paper products and enhance added value and market competitiveness of products.
30 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025III Management Discussion and Analysis
XII. Development and implementation of a market value management system and a valuation
enhancement plan (Cont'd)
(III) Market and brand development
1. Market expansion: The Company will strengthen market research to gain deeper insights into domestic and
international market demands while expanding into emerging markets. Leveraging its advantages in scale and
product quality the Company will intensify promotional efforts in global markets to increase export share and
enhance its international market influence.
2. Brand building: The Company will build a good corporate brand image by improving product quality enhancing
after-sales service and participating in public welfare initiatives. The Company will actively promote its green and
sustainable philosophy as well as technological innovation achievements to enhance its brand awareness and
reputation thereby increasing consumer recognition and loyalty toward its products.
3. Investor relations management: The Company will regularly disclose updates on information including operational
performance and development strategies while strengthening communication and engagement with investors.Through investor roadshows industry seminars and other events the Company will showcase its growth potential
and investment value to bolster investor confidence and attract more long-term investors.
4. Information disclosure optimisation: The Company will ensure the timeliness accuracy and completeness of
information disclosure by releasing operational data key project progress strategic plans and other information
on a regular basis to meet investor needs to know. Through periodic reports interim announcements investor
briefings and other channels the Company will demonstrate its core competitiveness and growth prospects to the
market.(IV) Strategic investment and cooperation
1. Strategic investor introduction: The Company will actively engage with domestic and international strategic
investors to introduce capital technology and management expertise and optimise its shareholding structure
and corporate governance. The introduction of strategic investors will provide additional resource support for the
Company thereby facilitating business development and valuation enhancement of the Company.
2. Industry consolidation and collaboration: The Company will pay attention to high-quality enterprises within
the industry and pursue mergers acquisitions and restructuring as and when appropriate to achieve resource
integration and scale expansion thereby strengthening its competitive position in the industry. The Company will
also enhance collaboration with upstream and downstream partners to establish long-term stable relationships
jointly navigate market changes and realise mutual benefits.In conclusion the Company will firmly uphold an investor-centric philosophy diligently implement its valuation enhancement
plan and remain committed to long-term sustainable healthy and high-quality development. By reinforcing accountability
the Company will effectively safeguard the interests of its investors.XIII. Implementation of the “Quality and Return Enhancement” action plan
Whether the Company has disclosed its “Quality and Return Enhancement” action plan
□ Yes □ No
SHANDONG CHENMING PAPER HOLDINGS LIMITED 31
INTERIM REPORT 2025IV Corporate Governance Environment and Society
I. Changes of Directors Supervisors and Senior Management of the Company
□ Applicable □ Not applicable
There was no change of Directors Supervisors and Senior Management of the Company during the reporting period. Please
see the 2024 annual report for details.II. Profit distribution and conversion of capital reserves into share capital during the reporting
period
□ Applicable □ Not applicable
The Company does not propose distribution of cash dividends and bonus shares and increase of share capital from reserves
for the interim period.III. Implementation of the equity incentive plan employee shareholding plan or other employee
incentive measure of the Company
□ Applicable □ Not applicable
1. Equity incentive
(1) Overview of the 2020 Restricted A Share Incentive Scheme
* Purpose of the Share Incentive Scheme
In order to further improve the corporate governance structure of the Company promote the establishment
and improvement of long-term incentive and restraint mechanisms fully mobilise the enthusiasm
responsibility and mission of the directors core technology and business key personnel and bond the
interests of Shareholders the Company and individual operators together effectively making all parties to
attend to the long-term development of the Company and work together for it; at the same time in order to
further promote the long-term behaviour of decision-makers and operators promote the sustainable and
steady development of the Company and maximise the value of the Company and shareholders the 2020
Restricted A Share Incentive Scheme was formulated on the premise of fully protecting the interests of
Shareholders and on the principle of income equivalent to contribution and in compliance with the relevant
requirements under the laws and regulations such as the Company Law and the Securities Law regulatory
documents and the Articles of Association combined with the existing management systems of the
Company including the remuneration mechanism and performance appraisal system.* Participants under the Share Incentive Scheme
The number of the participants under the 2020 Restricted A Share Incentive Scheme shall be 111
specifically including:
(i) Directors senior management members of the Company (ii) key technical (business) employees of the
Company and (iii) the persons who in the opinion of the Board are qualified. The participants under the
2020 Restricted A Share Incentive Scheme exclude independent non-executive Directors Supervisors
and Shareholders individually or in aggregate holding 5% or more of the shares of the Company or the
de facto controllers and their spouses parents or children. Among the above participants a director or
senior management member must have been elected at a general meeting or engaged by the Board. All
participants should be engaged employed or hired by the Company or any of the branch or subsidiary of
the Company at the time of granting under the Share Incentive Scheme and during the appraisal period.All of the participants under the Incentive Scheme shall not participate in an incentive scheme of any other
listed company concurrently and any of the participants who has participated in an incentive scheme of any
other listed company shall not participate in the Incentive Scheme. No other persons who are not Directors
nor employees of the Company are qualified as participants.
32 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025IV Corporate Governance Environment and Society
III. Implementation of the equity incentive plan employee shareholding plan or other employee
incentive measure of the Company (Cont’d)
1. Equity incentive (Cont’d)
(1) Overview of the 2020 Restricted A Share Incentive Scheme (Cont’d)
* Number of shares granted and the grant price
The Company issued and granted 79.6 million restricted A shares to 111 participants on 29 May 2020 under
the 2020 Restricted A Share Incentive Scheme (Draft) of the Company. This grant shall be one-off in nature
without reserved portion. The grant price of the restricted shares shall be RMB2.85 per share. A participant
may purchase the restricted shares of the Company issued by the Company to the Participants at RMB2.85
per share. During the reporting period the total shares to be issued under the Scheme represented
approximately 0% of the shares in issue (excluding the treasury shares) of the Company.* Basis of determination of the grant price
The grant price of the restricted shares granted by the Company via means of issuing additional shares
under the Incentive Scheme shall be determined according to principle of fair market price and shall be the
higher of the followings:
(i) 60% of the closing price of the shares of the Company on the last trading day before the date of the
announcement of the Incentive Scheme;
(ii) 60% of the average closing prices of the shares of the Company on the last 30 trading days before the
date of the announcement of the Incentive Scheme;
(iii) 60% of the average trading prices (the total transaction value for the last trading days divided by the
total transaction volume for the last trading days) of the shares of the Company on the last trading day
before the date of the announcement of the Incentive Scheme;
(iv) 60% of the average trading price (the total transaction value for the last 20 trading days divided by
the total transaction volume for the last 20 trading days) of the shares of the Company on the last 20
trading days before the date of the announcement of the Incentive Scheme; or
(v) the nominal value of the shares of Company being RMB1 per share.Based on the above pricing principles the grant price of the restricted shares to be granted under the
Incentive Scheme shall be RMB2.85 per share.The restricted shares granted to the participants shall be funded by themselves. The Company shall
undertake not to provide loans loan guarantee and any other form of financial assistance to the participants
for the acquisition of the restricted shares under the Incentive Scheme.* Validity period and lock-up periods of the Share Incentive Scheme
The validity period of the Incentive Scheme shall commence on the date on which the registration of the
grant of the restricted shares is completed and end on the date on which all the restricted shares granted to
the participants are unlocked or repurchased and cancelled which shall not exceed 60 months. On 14 July
2020 the Company completed the registration of the restricted shares granted under the Scheme with the
Shenzhen Branch of China Securities Depository and Clearing Corporation Limited. The Incentive Scheme
is valid until 14 July 2025. The lock-up periods of the restricted shares granted under the Incentive Scheme
shall be 24 months 36 months and 48 months from the date of registration of the restricted shares under
the grant.SHANDONG CHENMING PAPER HOLDINGS LIMITED 33
INTERIM REPORT 2025IV Corporate Governance Environment and Society
III. Implementation of the equity incentive plan employee shareholding plan or other employee
incentive measure of the Company (Cont’d)
1. Equity incentive (Cont’d)
(1) Overview of the 2020 Restricted A Share Incentive Scheme (Cont’d)
* Validity period and lock-up periods of the Share Incentive Scheme (Cont’d)
The share awards granted under the Scheme do not have a vesting period. After 24 months from the date
of completion of the registration of the grant of restricted shares granted under the Scheme if the unlocking
conditions of the restricted shares are satisfied the participants will unlock in three phases within the next
36 months. Upon expiry of each lock-up period the Company shall proceed with the unlocking for the
participants who satisfy the unlocking conditions and the restricted shares held by participants who do not
satisfy the unlocking conditions shall be repurchased and cancelled by the Company. The table below sets
out the unlocking period and unlocking schedule for the restricted shares under each grant:
Percentage of the
restricted shares to
be unlocked of total
number of the
restricted shares
Unlocking period Description of the unlocking period granted
First unlocking Period Commencing from the first trading day after expiry 40%
of the 24-month period from the date on which the
registration of the grant of the restricted shares is
completed and ending on the last trading day of
the 36-month period from the date on which the
registration of the grant of the restricted shares is
completed
Second unlocking Period Commencing from the first trading day after expiry 30%
of the 36-month period from the date on which the
registration of the grant of the restricted shares is
completed and ending on the last trading day of
the 48-month period from the date on which the
registration of the grant of the restricted Shares is
completed
Third unlocking Period Commencing from the first trading day after expiry 30%
of the 48-month period from the date on which the
registration of the grant of the restricted shares is
completed and ending on the last trading day of
the 60-month period from the date on which the
registration of the grant of the restricted shares is
completed
Note: The completion date of registration of the grant of the restricted A shares is 14 July 2020.The participants correspond to the restricted shares that cannot be unlocked during the unlocking period
and cannot be deferred to the future years to unlock the restricted shares. These restricted shares shall be
repurchased and cancelled by the Company. The repurchase price is the price granted for the restricted
shares plus the bank loan interest rate for the same period.
34 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025IV Corporate Governance Environment and Society
III. Implementation of the equity incentive plan employee shareholding plan or other employee
incentive measure of the Company (Cont’d)
1. Equity incentive (Cont’d)
(1) Overview of the 2020 Restricted A Share Incentive Scheme (Cont’d)
* The maximum number of the shares to be granted to a participant
The total number of shares to be issued and granted under the Incentive Scheme during the validity period
shall not exceed 10% of the total issued share capital of the Company and the total number of the restricted
shares to be granted under the Incentive Scheme during the validity period to the participant shall not
exceed 1% of the total issued share capital of the Company.* The period for the exercise of the share options by a participant under the scheme
Not applicable
* The amount if any payable on application for or acceptance of an award and the period within which
payment or notification of payment is to be made or the loan on application for an award is to be repaid
No payment is to be made on acceptance of an award.
(2) Relevant procedures performed under the 2020 Restricted A Share Incentive Scheme
* On 30 March 2020 the Company convened the ninth extraordinary meeting of the ninth session of the
Board at which the Company considered and approved the Resolution in Relation to the 2020 Restricted
Share Incentive Scheme of Shandong Chenming Paper Holdings Limited (Draft) and Its Summary and other
resolutions. On the same date the fourth extraordinary meeting of the ninth session of the Supervisory
Committee of the Company considered and approved the above resolutions and verified the list of proposed
participants of the incentive scheme. Independent Directors of the Company issued independent opinions
on the incentive scheme.* On 3 April 2020 the Company announced the list of participants through the Company’s internal website for
a period from 3 April 2020 to 12 April 2020. During the period the Supervisory Committee of the Company
and relevant departments did not receive any objection against the proposed participants. The Supervisory
Committee verified the list of participants under the grant of the incentive scheme.* On 15 May 2020 the Company convened the 2020 second extraordinary general meeting the 2020 first
class meeting for holders of domestic-listed shares and the 2020 first class meeting for holders of overseas-
listed shares at which the Company considered and approved the Resolution in Relation to the 2020
Restricted Share Incentive Scheme of Shandong Chenming Paper Holdings Limited (Draft) and Its Summary
and other resolutions. On 16 May 2020 the Company disclosed the Self-Examination Report for the Trading
of Shares of the Company by Insiders and Participants of the 2020 Restricted A Share Incentive Scheme.* On 29 May 2020 the Company convened the tenth extraordinary meeting of ninth session of the Board and
the fifth extraordinary meeting of the ninth session of the Supervisory Committee at which the Company
considered and approved the Resolution on the Matters Relating to Adjustments to the 2020 Restricted A
Share Incentive Scheme of the Company and the Resolution in Relation to the Grant of Restricted Shares
to the Participants approving the issue of 79600000 restricted A shares to 111 participants at the price of
RMB2.85 per share on 29 May 2020.* On 15 July 2020 the 79600000 restricted A shares granted to the participants were listed.* On 18 July 2022 the Company convened the second extraordinary meeting of the tenth session of the
Board and the first extraordinary meeting of the tenth session of the Supervisory Committee at which
the Company considered and approved the Resolution on the Fulfilment of the Unlocking Conditions
of the Restricted Shares Granted under the 2020 Restricted A Share Incentive Scheme during the First
Unlocking Period and the Resolution on the Adjustment to the Repurchase Price of the 2020 Restricted A
Share Incentive Scheme and Repurchase and Cancellation of Certain Restricted Shares. The independent
Directors of the Company issued independent opinions to agree with such resolutions.SHANDONG CHENMING PAPER HOLDINGS LIMITED 35
INTERIM REPORT 2025IV Corporate Governance Environment and Society
III. Implementation of the equity incentive plan employee shareholding plan or other employee
incentive measure of the Company (Cont’d)
1. Equity incentive (Cont’d)
(2) Relevant procedures performed under the 2020 Restricted A Share Incentive Scheme (Cont’d)
* (Cont’d)
96 participants fulfilled the unlocking conditions for the first unlocking period under the 2020 Restricted A
Share Incentive Scheme with 29948000 restricted shares being eligible for unlocking. 15 participants had
resigned had changed duty and had been removed from office which failed to comply with the unlocking
conditions. The total number of restricted shares granted to and held by the participants and not yet been
unlocked was 4466000 with a repurchase price of RMB2.5184172 per share (excluding the bank loan
interest rate for the same term). On 27 July 2022 29948000 restricted A shares that were unlocked were
listed for trading.On 9 October 2022 Grant Thornton (Special General Partnership) issued a Capital Verification Report (Zhi
Tong Yan Zi (2022) No. 371C000576) in which they verified the change in the registered capital and paid-
in capital (share capital) of the Company as of 30 September 2022. Verification result: As of 30 September
2022 the registered capital and paid-in capital (share capital) of the Company upon the change amounted
to RMB2979742200.00 and RMB2979742200.00 respectively.On 18 October 2022 the Company completed the procedures for the repurchase and cancellation of
4466000 restricted A shares with the Shenzhen Branch of China Securities Depository and Clearing
Corporation Limited.* On 17 July 2023 the Company convened the ninth extraordinary meeting of the tenth session of the
Board and the fifth extraordinary meeting of the tenth session of the Supervisory Committee at which the
Resolution on the Failure Fulfilment of the Unlocking Conditions for the Second Unlocking Period under the
2020 Restricted A Share Incentive Scheme and Repurchase and Cancellation of Certain Restricted Shares
was considered and approved. The independent Directors of the Company issued independent opinions to
agree with such resolutions. The results for 2022 of the Company failed to pass the performance appraisal
targets at company level set for the second unlocking period. Meanwhile 5 participants lost their incentive
qualification due to their resignation. The Board of the Company repurchased and cancelled 22929000
restricted A shares which had been granted to participants but not yet unlocked for the second unlocking
period at a repurchase price of RMB2.5184172 per share (excluding the bank loan interest rate for the same
term).On 10 November 2023 Grant Thornton (Special General Partnership) issued a Capital Verification Report
(Zhi Tong Yan Zi (2023) No. 371C000518) in which they verified the change in the registered capital and
paid-in capital (share capital) of the Company as of 18 October 2023. Verification result: As of 18 October
2023 the registered capital and paid-in capital (share capital) of the Company upon the change amounted
to RMB2956813200.00 and RMB2956813200.00 respectively.On 20 November 2023 the Company completed the procedures for the repurchase and cancellation of
22929000 restricted A shares with the Shenzhen Branch of China Securities Depository and Clearing
Corporation Limited.* On 31 July 2024 the Company convened the first special meeting of independent Directors of the tenth
session of the Board the fifteenth extraordinary meeting of the tenth session of the Board and the sixth
extraordinary meeting of the tenth session of the Supervisory Committee at which the Resolution on the
Failure Fulfilment of the Unlocking Conditions for the Third Unlocking Period under the 2020 Restricted
A Share Incentive Scheme and Repurchase and Cancellation of Restricted Shares was considered and
approved. The results for 2023 of the Company failed to pass the performance appraisal targets at company
level set for the third unlocking period. The Board of the Company repurchased and cancelled 22257000
restricted A shares that had been granted to 93 participants but not yet unlocked at a repurchase price of
RMB2.5184172 per share (excluding the bank loan interest rate for the same term).On 15 November 2024 Grant Thornton (Special General Partnership) issued a Capital Verification Report
(Zhi Tong Yan Zi (2024) No. 371C000421) in which they verified the change in the registered capital and
paid-in capital (share capital) of the Company as of 6 November 2024. Verification result: As of 6 November
2024 the registered capital and paid-in capital (share capital) of the Company upon the change amounted
to RMB2934556200.00 and RMB2934556200.00 respectively.
36 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025IV Corporate Governance Environment and Society
III. Implementation of the equity incentive plan employee shareholding plan or other employee
incentive measure of the Company (Cont’d)
1. Equity incentive (Cont’d)
(2) Relevant procedures performed under the 2020 Restricted A Share Incentive Scheme (Cont’d)
* (Cont’d)
On 18 December 2024 the Company completed the procedures for the repurchase and cancellation of
the 15357000 restricted A shares held by 91 participants with the Shenzhen Branch of China Securities
Depository and Clearing Corporation Limited. The procedures for the share repurchase transfer and
cancellation of the 6900000 restricted A shares held by 2 participants (both of whom have resigned) were
still not completed as they were subject to judicial freeze.
(3) Implementation of the equity incentive plan during the reporting period
As at the beginning and the end of the reporting period the number of awards to be granted under authority of
the Scheme was 0. During the reporting period the Company did not grant any awards and accordingly the
number of shares that may be issued in respect of awards granted under all schemes during the reporting period
divided by the weighted average number of shares of the relevant class in issue (excluding treasury shares) for the
reporting period is not applicable.In November 2024 pursuant to the 2020 Restricted A Share Incentive Scheme (Draft) the Company made
payments to all participants for the repurchase of restricted shares not yet unlocked for the third unlocking
period under the 2020 Restricted A Share Incentive Scheme and handled the share repurchase and cancellation
procedures in accordance with the procedures. As at the end of the reporting period the procedures for the share
repurchase transfer and cancellation of the 6900000 restricted A shares held by 2 participants (both of whom
have resigned) with the Shenzhen Branch of China Securities Depository and Clearing Corporation Limited were
still not completed as they were subject to judicial freeze. Save as disclosed above during the reporting period
no other participants held any options or awards under the scheme.
2. Implementation of the employee shareholding plan
□ Applicable □ Not applicable
3. Other employee incentive measure
□ Applicable □ Not applicable
SHANDONG CHENMING PAPER HOLDINGS LIMITED 37
INTERIM REPORT 2025IV Corporate Governance Environment and Society
IV. Disclosure of environmental information
Whether the listed company and its major subsidiaries are included in the list of enterprises subject to mandatory
environmental information disclosure
□ Yes □ No
Number of enterprises included in the list of enterprises subject to mandatory environmental information disclosure (entities) 7
No. Name of enterprise Index for mandatory disclosure reports on environmental information
1 Shandong Chenming Mandatory Corporate Environmental Information Disclosure System (Shandong)
Paper Holdings Limited http://221.214.62.226:8090//EnvironmentDisclosure/
2 Shouguang Meilun Mandatory Corporate Environmental Information Disclosure System (Shandong)
Paper Co. Ltd. http://221.214.62.226:8090//EnvironmentDisclosure/
3 Shouguang Chenming Mandatory Corporate Environmental Information Disclosure System (Shandong)
Art Paper Co. Ltd. http://221.214.62.226:8090//EnvironmentDisclosure/
4 Zhanjiang Chenming Mandatory Corporate Environmental Information Disclosure System (Guangdong)
Pulp & Paper Co. Ltd. https://www-app.gdeei.cn/gdeepub/front/dal/report/list
entName=%E6%99%A8%E9%B8%A3&reportType=&areaCode=440800&
entType=zdpw&reportDateStartStr=&reportDateEndStr=
5 Huanggang Chenming Mandatory Corporate Environmental Information Disclosure System (Hubei)
Pulp & Paper Co. Ltd. http://219.140.164.18:8007/hbyfpl/frontal/index.html#/home/enterpriseInfo
XTXH=142b6735-b868-4369-b7bc-30f0f5b5ac68&XH=1677749944758009244672
6 Jiangxi Chenming Mandatory Corporate Environmental Information Disclosure System (Jiangxi)
Paper Co. Ltd. http://qyhjxxyfpl.sthjt.jiangxi.gov.cn:15004/pilouxiangqing
id=90205301bb6147c9ae47291303f803fe
7 Jilin Chenming Mandatory Corporate Environmental Information Disclosure System (Jilin)
Paper Co. Ltd. http://36.135.7.198:9015/index
38 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025IV Corporate Governance Environment and Society
V. Social responsibility
During the reporting period the Company adhered to its corporate mission of “Creating Value Contributing to Society” as
always continued to focus on protecting the rights and interests of shareholders employees customers suppliers and other
stakeholders put the concept of low-carbon and green development into practice and fulfilled its social responsibilities.
1. Protecting the rights and interests of shareholders and creditors
The Company continued to optimise its corporate governance structure improved its internal control system strictly
implemented the insider information registration and management system and diligently fulfilled its information
disclosure obligations to ensure the truthfulness accuracy timeliness completeness and fairness of information
disclosure thereby continuously enhancing the transparency and quality of information disclosure. At the same time
the Company established diverse communication channels including an investor hotline the EasyIR platform of the
Shenzhen Stock Exchange an email and results briefings. During the reporting period the Company hosted the 2024
Online Results Briefing via the Panorama * Interactive Platform for Investors Relationship and actively participated in
the “2025 Online Collective Reception Day for Investors of Listed Companies in Shandong” such that investors were
able fully understand the operating results and financial position of the Company. General meetings were held both
on-site and online while counting the votes of minority shareholders separately on all resolutions to ensure their rights to
information and voting on major matters of the Company. Besides in response to certain overdue debts the Company
took the initiative to communicate with its creditors to negotiate reasonable debt repayment solutions such as loan term
extensions and adjusted repayment plans. The Company made every effort to secure working capital through multiple
channels and promoted resumption of work and production striving to protect the legitimate rights and interests of its
creditors.
2. Protecting the rights and interests of employees
In strict compliance with the Labour Law the Labour Contract Law and other laws and regulations the Company upheld
its employment philosophy of “Cultivating Talents Retaining Talents and Making Good Use of Talents” to strengthen
humanistic care emphasise employee empowerment and skill development and enhance the sense of happiness
fulfilment and belonging among employees. The Company fully implemented the production safety accountability
system promoted awareness of laws and regulations related to production safety organised regular training sessions
on production safety and conducted emergency drills to improve safety awareness among all employees. The trade
union committee fully played a role as a bridge enriched the cultural and sports activities for employees facilitated
communication channels for employees and enabled flat and efficient management to boost productivity and
satisfaction of employees. The Company valued the career development and personal growth of employees and
implemented training programs by levels and types. It established the Cadre Management Measures the Recruitment
Standards and Onboarding Management Measures the Implementation Rules for Seniority and Professional Title
Allowances and other policies and systems to optimise hiring mechanisms and performance appraisal systems so as to
ensure fair and reasonable compensation for employees and foster their mutual growth with the Company.
3. Protecting the rights and interests of customers and suppliers
The Company upheld its core values of “Integrity Win-Win and Sharing” as always by placing high importance on
protecting the rights and interests of customers and suppliers while striving to maintain harmonious partnerships with
customers and suppliers. In protecting the rights and interests of customers the Company adhered to its marketing
philosophy of “Integrity Mutual Benefit and Better Future for All”. It was customer-centred and market demand-oriented
and constantly improved service quality to meet customer demand and create benefits of branding. At the same time
it highly regarded follow-up services for customers optimised complaint handling procedures and improved service
quality to constantly increase customer satisfaction. In protecting the rights and interests of suppliers the Company
followed the principles of fairness and mutual benefit and continued to refine supply chain management. By improving
the Procurement and Tender Management System the Company enhanced transparency in procurement processes
and thus created a level playing field for suppliers. Meanwhile the Company also prioritised strategic cooperation with
high-quality suppliers and fostered long-term collaboration to improve supply chain quality efficiency and stability
achieving cost reduction and efficiency enhancement. During the reporting period the Company revised various
systems including the Commodity Pulp Procurement Standards and Process Control Management System and the
Coal Procurement Sampling and Testing Management Standards which further reinforced supply chain management
and improved the supply chain management standard.SHANDONG CHENMING PAPER HOLDINGS LIMITED 39
INTERIM REPORT 2025IV Corporate Governance Environment and Society
V. Social responsibility (Cont’d)
4. Protecting the ecological environment
The Company steadfastly put the development philosophy of “lucid waters and lush mountains are invaluable assets”
into practice was guided by the principle of “green development eco-friendly Chenming” and resolutely pursued the
high quality development path of giving priority to the ecology and adopting a green and low-carbon policy achieving a
“win-win” situation in terms of economic benefits and environmental benefits. During the reporting period the Company
fully implemented local environmental policies across its production bases in response to the national “Dual Carbon”
strategic goal and in strict compliance with the Environmental Protection Law of the People’s Republic of China the Law
on the Prevention and Control of Air Pollution of the People’s Republic of China the Law on the Prevention and Control
of Environmental Pollution by Solid Waste of the People’s Republic of China the Law on the Prevention and Control
of Water Pollution of the People’s Republic of China and other environmental laws and regulations. By introducing
clean production strengthening “three wastes” management and reinforcing energy-saving and emission-reduction
measures the Company established a comprehensive environmental governance system. Advanced pollution
treatment facilities including the alkali recovery system reclaimed water treatment system reclaimed water reuse
system and black liquor comprehensive utilisation system were installed to ensure all emission indicators met national
environmental protection standards. Meanwhile the Company placed strong emphasis on technological innovation
integrated eco-design principles into product processes and actively developed green products so as to earnestly
assume its social responsibility to protect the ecological environment and facilitate harmonious and mutually beneficial
development for both the enterprise and society.VI. Disclosures as required by the Hong Kong Listing Rules issued by the Stock Exchange of
Hong Kong Limited
(I) Compliance with the Code on Corporate Governance
The Company maintained high standards of corporate governance practices through various internal controls. The
Board reviews the corporate governance practices of the Company from time to time to enhance the corporate
governance standards of the Company. The Company had fully complied with all the principles and code provisions
of the Code on Corporate Governance as set out in Appendix C1 to the Hong Kong Listing Rules during the reporting
period except for the following:
Code provision B.2.2 of the Code on Corporate Governance stipulates that every director including those appointed
for a specific term should be subject to retirement by rotation at least once every three years. The terms of office of the
tenth session of the Board of Directors and the Supervisory Committee of the Company have expired on 15 June 2025.Given that the election of new sessions of the Board of Directors and the Supervisory Committee of the Company has
not yet been completed the terms of office of the Board of Directors its special committees the Supervisory Committee
and senior management will be extended accordingly. For details please refer to the relevant announcement disclosed
by the Company on CNINFO on 14 June 2025 (Announcement No.: 2025-045) and the announcement disclosed by the
Company on the website of Hong Kong Stock Exchange on 13 June 2025.(II) Securities transactions by Directors
The Directors of the Company confirmed that the Company had adopted the Model Code for Securities Transactions
by Directors of Listed Companies as set out in Appendix C3 to the Hong Kong Listing Rules. Having made adequate
enquiries with all Directors and Supervisors of the Company the Company was not aware of any information that
reasonably suggested that the Directors and Supervisors had not complied with the requirements as stipulated in this
code during the reporting period.
40 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025V Material Matters
I. Undertakings made by parties involved in undertakings including the Company’s beneficial
controllers shareholders related parties bidders and the Company fulfilled during the
reporting period and not yet fulfilled within the prescribed time period as at the end of the
reporting period
□ Applicable □ Not applicable
During the reporting period there were no such undertakings in respect of the Company as those made by parties involved in
undertakings including the Company’s beneficial controllers shareholders related parties bidders and the Company fulfilled
during the reporting period and not yet fulfilled within the prescribed time period as at the end of the reporting period.II. Appropriation of funds of the Company by the controlling shareholder and other related
parties for non-operating purposes
□ Applicable □ Not applicable
There was no appropriation of funds of the Company by the controlling shareholder and other related parties for non-operating
purposes during the reporting period.III. External guarantees against the rules and regulations
□ Applicable □ Not applicable
There was no external guarantee provided by the Company which was against the rules and regulations during the reporting
period.IV. Engagement or dismissal of accounting firms
Has the interim financial report been audited
□ Yes □ No
The interim report of the Company is unaudited.V. Opinions of the Board and the Supervisory Committee regarding the “modified auditor’sreport” for the reporting period issued by the accountants
□ Applicable □ Not applicable
SHANDONG CHENMING PAPER HOLDINGS LIMITED 41
INTERIM REPORT 2025V Material Matters
VI. Opinions of the Board regarding the “modified auditor’s report” for the prior year
□ Applicable □ Not applicable
Grant Thornton (Special General Partnership) issued an audit report with a qualified opinion on the 2024 financial report of the
Company. The Board of the Company had provided a special statement on the relevant matters. For details please refer to
the Special Statement of the Board of Directors on Matters Related to the 2024 Annual Audit Report disclosed on CNINFO on
1 April 2025 and the overseas regulatory announcement disclosed on the website of Hong Kong Stock Exchange on 31 March
2025 by the Company.
During the reporting period the Company attached great important to the matters covered in the audit report with a qualified
opinion. With the support of government authorities at all levels the Company actively promoted the implementation of
various tasks such as resumption of operation and production grant of syndicated loan debt restructuring introduction of
strategic investments and asset disposal. It also took various measures to raise liquidity and strove to improve its ability to
continue as a going concern with a view to eliminating the relevant matters and their effect as soon as possible and effectively
safeguarding the interests of the Company and all its shareholders. As of the end of the reporting period the production of
certain production lines of the Huanggang production base the Jiangxi production base and Shouguang production base of
the Company was normal. By fully leveraging the shutdown period for equipment maintenance and upgrading equipment
integrity and operational efficiency were enhanced. For the production lines that had resumed operation and production
the Company adopted whole process control over the procurement of raw materials cost savings quality improvement and
many other respects. The Company made huge efforts in cash flow and cost management and control to gradually restore its
profitability. At the same time the Company actively strengthened communication with financial institutions and implemented
relevant work on maturity extension interest rate reduction and interest settlement cycle extension and the syndicated loan
of RMB2.31 billion specifically for the resumption of operation and production with the support of government authorities
and financial institutions. As at the disclosure date of this report the syndicated loan of RMB2.31 billion was approved. In
addition the Company was actively introducing strategic investments by engaging and negotiating with interested strategic
investors and strong companies. The Company strengthened its communication with creditors to negotiate solutions such as
extension of loan terms interest rate reduction and adjustment of repayment plans. The Company revitalised and disposed of
its existing assets by strengthening the disposal of assets in its non-principal business and establishing an asset management
centre thus improving the efficiency of asset disposal. As at the end of the reporting period the Company disposed of idle
and non-core assets worth RMB587.7304 million. The Company stepped up efforts to recover outstanding debts to enhance
its liquidity. The Company made every effort to secure its liquidity and advanced resumption of operation and production as
soon as possible thus achieving sustainable and stable operation of the Company restoring its profitability and solvency
effectively mitigating debt risks and safeguarding the interests of public investors.VII. Matters related to bankruptcy and reorganisation
□ Applicable □ Not applicable
There was no matter related to bankruptcy and reorganisation during the reporting period.
42 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025V Material Matters
VIII. Litigation
Material litigation and arbitration
□ Applicable □ Not applicable
Whether
General information on provisions Trial results Enforcement of
the litigation (arbitration) Amount involved are made Progress and impact judgment Disclosure date Disclosure index
Statutory demand and HK$389112432.44 No On 15 May 2025 an On 20 June 2025 the Company The judgment 28 June 2025 http://www.cninfo.com.cn
winding-up petition application was made by received the order made by was enforced. (Announcement No.Arjowiggins HKK2 Limited the Court of First Instance 2025-046)
(“HKK2”) to the court by dismissing the Petitioner’s 27 June 2025 http://www.hkex.com.hk
way of a summon (the Summons and the winding-
“Petitioner’s Summons”) for up petition.an order that the stay of the
winding-up petition be lifted
and to restore the hearing of
the winding-up petition. On
13 June 2025 the Company
and HKK2 jointly applied
to dismiss the Petitioner’s
Summons by way of consent
summons.Other litigations
□ Applicable □ Not applicable
General information Amount Whether
on the litigation involved provisions Trial results Enforcement of
(arbitration) (RMB’0000) are made Progress and impact judgment Disclosure date Disclosure index
Summary of matters 46432.83 No The amount involved in For resolved litigations the The judgment is being 24 January 2025 1 March http://www.cninfo.com.cn
subject to litigation ongoing cases was court ordered relevant enforced. 2025 12 April 2025 24 (Announcements No.(arbitration) in which RMB62.9575 million; defendant and guarantor May 2025 and 23 January 2025-003 2025-008
Chenming Leasing is the amount involved to settle outstanding 2025 28 February 2025 2025-034 and
the plaintiff in resolved cases was loans to the Company in 11 April 2025 and 23 May 2025-044) and
RMB401.3708 million. line with the request of 2025 http://www.hkex.com.hk
the Company and would
not have any significant
impact on the operations
and financial position of
the Company.Summary of matters 43406.09 No The amount involved in The cases had no significant The judgment is being
subject to litigation ongoing cases was impact on the operations enforced.(arbitration) in which RMB139.3753 million; and financial position of
the Company and the amount involved the Company.other subsidiaries of the in resolved cases was
Company are the RMB294.6856 million.plaintiffs
Summary of matters 777818.36 Provision of The amount involved in The cases were properly The judgment is being
subject to litigation RMB5.935 ongoing cases was resolved through enforced.(arbitration) in which million RMB4979.8001 million; communication and
the Company and the amount involved negotiation an active
other subsidiaries of in resolved cases was defence and reaching
the Company are the RMB2798.3835 million. settlements with creditors.defendants
SHANDONG CHENMING PAPER HOLDINGS LIMITED 43
INTERIM REPORT 2025V Material Matters
IX. Punishment and rectification
□ Applicable □ Not applicable
During the reporting period there was no punishment and rectification against the Company.X. Credibility of the Company its controlling shareholders and beneficial controllers
□ Applicable □ Not applicable
According to information disclosed on the China Enforcement Information Online during the reporting period the Company
and Zhanjiang Chenming were listed as dishonest persons subject to enforcement for failing to fulfil obligations as determined
by effective legal documents issued by the court which involved two cases of dishonesty. Neither the Company’s controlling
shareholder nor its actual controller is listed as a dishonest person subject to enforcement.XI. Significant related party transactions
1. Related party transactions associated with day-to-day operation
□ Applicable □ Not applicable
Subject Pricing
Types matter basis Amount of Percentage Market
of the of the of the Related related as the Amount of Whether Settlement price of
Relationship related related related party party amount transactions exceeding of related available
with the party party party transaction transactions of similar approved approved party similar Disclosure Disclosure
Related party Company transactions transactions transaction price (RMB’0000) transactions (RMB’0000) cap transactions transaction date index
Weifang Port Joint venture Labour Port Market price Market price 233.33 3.88% 11000.00 No Bank N/A 1 April 2025 http://www.Area Wood Chip services miscellaneous acceptance cninfo.Port Co. Ltd fees and com.cn
telegraphic
transfer
Total － － 233.33 － 11000.00 － － － － －
Particulars on refund of bulk sale No
Estimated total amount for day-to-day related party transactions to be conducted during the period No
(by types of transactions) and their actual implementing during the reporting period (if any)
Reasons for large differences between transaction price and market reference price (if applicable) N/A
2. Related party transaction in connection with purchase or sale of assets or equity interest
□ Applicable □ Not applicable
There was no related party transaction of the Company in connection with purchase or sale of assets or equity interest
during the reporting period.
3. Related party transaction connected to joint external investment
□ Applicable □ Not applicable
There was no related party transaction of the Company connected to joint external investment during the reporting
period.
44 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025V Material Matters
XI. Significant related party transactions (Cont’d)
4. Related creditors’ rights and debts transactions
□ Applicable □ Not applicable
Was there any non-operating related creditors’ rights and debts transaction
? Yes □ No
Creditor’s rights receivable from any related party
Was there Amount Amount
any non- increased recovered Interest for
Relationship operating Opening during the during the the current Closing
with the capital balance current period current period period balance
Related party Company Reason occupation (RMB’0000) (RMB’0000) (RMB’0000) Interest rate (RMB’0000) (RMB’0000)
Shouguang Meite Environmental Joint venture Financial support No 1106.33 6.00% 31.46 1137.78
Technology Co. Ltd.Weifang Port Area Wood Joint venture Financial support No 7939.77 6.00% 190.05 8129.82
Chip Port Co. Ltd
Wuhan Chenming Hanyang An associate Financial support No 23809.34 6548.31 4.75% 536.11 17797.13
Paper Holdings Co. Ltd.Effect of related creditors’ The above creditors’ rights did not affect the ordinary operation of the Company. Moreover they catered to the needs for development of existing
rights on the operating businesses of the above entities as well as lowered the finance costs.results and financial
position of the Company
Debts payable to any related party
Amount Amount
increased repaid Interest
during the during the for the
Relationship Opening current current current Closing
with the balance period period period balance
Related party Company Reason (RMB’0000) (RMB’0000) (RMB’0000) Interest rate (RMB’0000) (RMB’0000)
Chenming Holdings Company Limited Controlling Financial support 3850.00 248.98 Market interest rate 82.96 3683.98
shareholder
Guangdong Nanyue Bank Co. Ltd. An associate Borrowing 85789.00 9960.00 Market interest rate 4742.23 75829.00
Effect of related debts on the Financial support was provided by Chenming Holdings without requiring any pledge or guarantee which was a testament to its
operating results and financial support for the future development of the Company and helped the Company promote project construction and satisfy its needs for
position of the Company working capital.SHANDONG CHENMING PAPER HOLDINGS LIMITED 45
INTERIM REPORT 2025V Material Matters
XI. Significant related party transactions (Cont’d)
5. Deals with related financial companies
□ Applicable □ Not applicable
There were no deposits loans credits or other financial services between the Company its related financial companies
and the related parties.
6. Deals between financial companies controlled by the company and related parties
□ Applicable □ Not applicable
There were no deposits loans credits or other financial services between the financial companies controlled by the
Company and the related parties.
7. Other significant related party transactions
□ Applicable □ Not applicable
There was no other significant related party transaction of the Company during the reporting period.XII. Material contracts and implementation
1. Custody contracting and leasing
(1) Custody
□ Applicable □ Not applicable
There was no custody of the Company during the reporting period.
(2) Contracting
□ Applicable □ Not applicable
Contracting description
In April 2023 Jiangxi Chenming a subsidiary acquired equity interest in Jiangxi Port which was included in the
scope of consolidation. The principal activities of Jiangxi Port is goods loading and transportation at wharf. In
order to revitalise Jiangxi Port and enhance economic benefits to the Company Jiangxi Chenming has contracted
the businesses of Jiangxi Port to Jiangxi Yirong Investment Co. Ltd. for 5 years and receives fixed contracting
fees of RMB4.00 million per year on quarterly basis.A project which generates profit or loss for the Company representing more than 10% of the Company’s total
profit during the reporting period
□ Applicable □ Not applicable
The Company did not have any contracting project that brought profit or loss to the Company amounting to more
than 10% of the total profit of the Company during the reporting period.
46 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025V Material Matters
XII. Material contracts and implementation (Cont’d)
1. Custody contracting and leasing (Cont’d)
(3) Leasing
□ Applicable □ Not applicable
Leasing description:
As a lessee
The Company has simplified the treatment of short-term leases and leases of low-value assets by not recognising
right-of-use assets and lease liabilities. The charges to expense for short-term leases low-value assets and
variable lease payments not included in the measurement of lease liabilities during the current period are as
follows:
Unit: RMB
Item First half of 2025
Low-value leases 2220927.78
Total 2220927.78
As a lessor
Where an operating lease is formed:
According to paragraph 58 of the new lease standard the lessor shall disclose in the notes the following
information related to operating leases:
* Lease income and make separate disclosure of income related to variable lease payments not included in
lease receipts
Unit: RMB
Item First half of 2025
Lease income 60638854.58
* The amount of undiscounted lease receipts to be received in each of the five consecutive fiscal years after
the balance sheet date and the total amount of undiscounted lease receipts to be received in the remaining
years
Unit: RMB
Year 30 June 2025
Within 1 year after the balance sheet date 113444741.22
1 to 2 years after the balance sheet date 116223430.35
2 to 3 years after the balance sheet date 124807602.90
3 to 4 years after the balance sheet date 134385334.75
4 to 5 years after the balance sheet date 141878129.24
More than 5 years after the balance sheet date 140844716.92
Total 771583955.38
SHANDONG CHENMING PAPER HOLDINGS LIMITED 47
INTERIM REPORT 2025V Material Matters
XII. Material contracts and implementation (Cont’d)
1. Custody contracting and leasing (Cont’d)
(3) Leasing (Cont’d)
* (Cont’d)
A project which generates profit or loss for the Company representing more than 10% of the Company’s
total profit during the reporting period
□ Applicable □ Not applicable
The Company did not have any leasing project that brought profit or loss to the Company amounting to
more than 10% of the total profit of the Company during the reporting period.
2. Significant guarantees
□ Applicable □ Not applicable
(1) Guarantees
During the reporting period the Company provided guarantee to subsidiaries and the guarantee amount
incurred was RMB4329.6553 million. As at 30 June 2025 the balance of the external guarantee provided
by the Company (including the guarantee to its subsidiaries by the Company and the guarantee provided
to subsidiaries by subsidiaries) amounted to RMB19754.8803 million representing 371.42% of the equity
attributable to shareholders of the Company as at the end of June 2025 of which overdue guarantees amounted
to RMB1978.7067 million.Unit: RMB’0000
External guarantees of the Company and its subsidiaries (excluding guarantees to subsidiaries)
Date of
the related
announcement Guarantee
disclosing to related
the guarantee Amount of Guarantee Guarantee Type of Counter- Fulfilled parties
Name of obligee amount guarantee date provided guarantee Collateral guarantee Term or not or not
Weifang Port Area Wood 24 July 2017 17500.00 20 December 7840.00 Joint and Credit guarantee No 10 years No Yes
Chip Port Co. Ltd 2017 several
liability
Zhanjiang Runbao 28 March 2024 16000.00 25 April 2024 16000.00 Pledged 34.64% equity Equity transfer 2 years No No
Trading Co. Ltd. interest payment of
in Wuhan RMB160
Chenming million
Zhanjiang Dingjin 7 December 13558.19 7 December 13558.19 Charged Properties Remaining 3 years No No
Trading Co. Ltd. 2022 2022 equity transfer
payment of
RMB136
million
Shanghai Shuilan 7 December 45700.00 7 December 45000.00 Pledged 100% equity 80% equity 3 years No No
Trading Co. Ltd. 2022 2022 interest in interest in
Shanghai Taixing Port
Chongmin held by
Shanghai
Huahao
Weifang Xingchen 25 April 2025 550000.00 – – – – – 6 years No No
Trading Co. Ltd.Total external guarantees approved during the reporting period (A1) 550000.00 Total actual external guarantees during the reporting period (A2) –
Total external guarantees approved at the end of the reporting period (A3) 642758.19 Balance of total actual guarantees at the end of the reporting period (A4) 82398.19
48 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025V Material Matters
XII. Material contracts and implementation (Cont’d)
2. Significant guarantees (Cont’d)
(1) Guarantees (Cont’d)
Guarantees between the Company and its subsidiaries
Date of
the related
announcement
disclosing Guarantee
the guarantee Amount of Guarantee Type of Counter- Fulfilled to related
Name of obligee amount guarantee Guarantee date provided guarantee Collateral guarantee Term or not parties or not
Zhanjiang Chenming Pulp & 30 March 2016 27500.00 14 March 2016 27500.00 Joint and No No 12 years No No
Paper Co. Ltd. several
liability
guarantee
Zhanjiang Chenming Pulp & 27 October 94000.00 26 March 2018 94000.00 Joint and No No 11 years No No
Paper Co. Ltd. 2017 several
liability
guarantee
Zhanjiang Chenming Pulp & 30 March 2022 24154.03 17 June 2022 24154.03 Joint and No No 3 years No No
Paper Co. Ltd. several
liability
guarantee
Zhanjiang Chenming Pulp & 30 March 2023 98007.23 2 June 2023 98007.23 Joint and No No 3 years No No
Paper Co. Ltd. several
liability
guarantee
Zhanjiang Chenming Pulp & 28 March 2024 314226.55 16 May 2024 314226.55 Joint and No No 2 years No No
Paper Co. Ltd. several
liability
guarantee
Zhanjiang Chenming Pulp & 31 March 2025 1070000.00 20 May 2025 33778.00 Joint and No No 1 year No No
Paper Co. Ltd. several
liability
guarantee
Shouguang Meilun Paper Co. 28 March 2020 45341.50 9 September 2021 45341.50 Joint and No No 5 years No No
Ltd. several
liability
guarantee
Shouguang Meilun Paper Co. 30 March 2022 42322.79 24 May 2022 42322.79 Joint and No No 5 years No No
Ltd. several
liability
guarantee
Shouguang Meilun Paper Co. 30 March 2023 84814.78 9 June 2023 84814.78 Joint and No No 7 years No No
Ltd. several
liability
guarantee
Shouguang Meilun Paper Co. 28 March 2024 111121.49 24 May 2024 111121.49 Joint and No No 4 years No No
Ltd. several
liability
guarantee
SHANDONG CHENMING PAPER HOLDINGS LIMITED 49
INTERIM REPORT 2025V Material Matters
XII. Material contracts and implementation (Cont’d)
2. Significant guarantees (Cont’d)
(1) Guarantees (Cont’d)
Guarantees between the Company and its subsidiaries
Date of
the related
announcement
disclosing Guarantee
the guarantee Amount of Guarantee Type of Counter- Fulfilled to related
Name of obligee amount guarantee Guarantee date provided guarantee Collateral guarantee Term or not parties or not
Shouguang Meilun Paper Co. 31 March 2025 470000.00 20 May 2025 37643.37 Joint and No No 1 year No No
Ltd. several
liability
guarantee
Jiangxi Chenming Paper Co. 27 March 2018 11594.74 28 February 2022 11594.74 Joint and No No 5 years No No
Ltd. several
liability
guarantee
Jiangxi Chenming Paper Co. 30 March 2022 9609.49 23 May 2023 9609.49 Joint and No No 3 years No No
Ltd. several
liability
guarantee
Jiangxi Chenming Paper Co. 30 March 2023 9533.46 8 September 2023 9533.46 Joint and No No 3 years No No
Ltd. several
liability
guarantee
Jiangxi Chenming Paper Co. 28 March 2024 175412.16 31 May 2024 175412.16 Joint and No No 1.5 years No No
Ltd. several
liability
guarantee
Jiangxi Chenming Paper Co. 31 March 2025 300000.00 22 May 2025 8195.00 Joint and No No 1 year No No
Ltd. several
liability
guarantee
Huanggang Chenming Pulp & 30 March 2016 75364.00 16 December 75364.00 Joint and No No 12 years No No
Paper Co. Ltd. 2019 several
liability
guarantee
Huanggang Chenming Pulp & 30 March 2022 25385.32 20 May 2022 25385.32 Joint and No No 4 years No No
Paper Co. Ltd. several
liability
guarantee
Huanggang Chenming Pulp & 30 March 2023 26412.69 18 July 2023 26412.69 Joint and No No 4 years No No
Paper Co. Ltd. several
liability
guarantee
Huanggang Chenming Pulp & 28 March 2024 34748.06 19 July 2024 34748.06 Joint and No No 1 year No No
Paper Co. Ltd. several
liability
guarantee
50 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025V Material Matters
XII. Material contracts and implementation (Cont’d)
2. Significant guarantees (Cont’d)
(1) Guarantees (Cont’d)
Guarantees between the Company and its subsidiaries
Date of
the related
announcement
disclosing Guarantee
the guarantee Amount of Guarantee Type of Counter- Fulfilled to related
Name of obligee amount guarantee Guarantee date provided guarantee Collateral guarantee Term or not parties or not
Huanggang Chenming Pulp & 31 March 2025 260000.00 20 May 2025 9000.00 Joint and No No 1 year No No
Paper Co. Ltd. several
liability
guarantee
Huanggang Chenming Paper 31 March 2025 20000.00 – – Joint and No No 1 year No No
Technology Co. Ltd. several
liability
guarantee
Chenming (HK) Limited 30 March 2023 3774.46 4 January 2024 3774.46 Joint and No No 6 years No No
several
liability
guarantee
Chenming (HK) Limited 28 March 2024 9126.09 7 May 2025 9126.09 Joint and No No 1 year No No
several
liability
guarantee
Chenming (HK) Limited 31 March 2025 250000.00 3 June 2025 1354.83 Joint and No No 1 year No No
several
liability
guarantee
Zhanjiang Chenming 30 March 2023 4416.00 29 March 2024 4416.00 Joint and No No 2 years No No
Arboriculture Development several
Co. Ltd. liability
guarantee
Zhanjiang Chenming 31 March 2025 10000.00 – – Joint and No No 1 year No No
Arboriculture Development several
Co. Ltd. liability
guarantee
Jilin Chenming Paper Co. Ltd. 30 March 2023 18000.00 15 December 18000.00 Joint and No No 2 years No No
2023 several
liability
guarantee
Jilin Chenming Paper Co. Ltd. 28 March 2024 36901.28 19 June 2024 36901.28 Joint and No No 2 years No No
several
liability
guarantee
Jilin Chenming Paper Co. Ltd. 31 March 2025 100000.00 – – Joint and No No 1 year No No
several
liability
guarantee
SHANDONG CHENMING PAPER HOLDINGS LIMITED 51
INTERIM REPORT 2025V Material Matters
XII. Material contracts and implementation (Cont’d)
2. Significant guarantees (Cont’d)
(1) Guarantees (Cont’d)
Guarantees between the Company and its subsidiaries
Date of
the related
announcement
disclosing Guarantee
the guarantee Amount of Guarantee Type of Counter- Fulfilled to related
Name of obligee amount guarantee Guarantee date provided guarantee Collateral guarantee Term or not parties or not
Shouguang Chenming Art Paper 31 March 2025 5000.00 – – Joint and No No 1 year No No
Co. Ltd. several
liability
guarantee
Chenming (Singapore) Co. Ltd. 31 March 2025 50000.00 – – Joint and No No 1 year No No
several
liability
guarantee
Shandong Chenming Pulp & 30 March 2023 15000.00 8 February 2024 15000.00 Joint and No No 1 year No No
Paper Sales Co. Ltd. several
liability
guarantee
Shandong Chenming Pulp & 28 March 2024 144982.19 14 August 2024 144982.19 Joint and No No 1 year No No
Paper Sales Co. Ltd. several
liability
guarantee
Shandong Chenming Pulp & 31 March 2025 185000.00 – – Joint and No No 1 year No No
Paper Sales Co. Ltd. several
liability
guarantee
Shanghai Hongtai Property 19 April 2023 199954.55 2 June 2023 199954.55 Joint and No No 15 years No No
Management Co. Ltd. several
liability
guarantee
Shanghai Hongtai Property 31 March 2025 210000.00 – – Joint and No No 1 year No No
Management Co. Ltd. several
liability
guarantee
Shanghai Chenming Pulp & 30 March 2022 899.62 13 February 2023 899.62 Joint and No No 3 years No No
Paper Sales Co. Ltd. several
liability
guarantee
Shanghai Chenming Pulp & 28 March 2024 57080.00 4 June 2024 57080.00 Joint and No No 1 year No No
Paper Sales Co. Ltd. several
liability
guarantee
Shanghai Chenming Pulp & 31 March 2025 80000.00 – – Joint and No No 1 year No No
Paper Sales Co. Ltd. several
liability
guarantee
52 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025V Material Matters
XII. Material contracts and implementation (Cont’d)
2. Significant guarantees (Cont’d)
(1) Guarantees (Cont’d)
Guarantees between the Company and its subsidiaries
Date of
the related
announcement
disclosing Guarantee
the guarantee Amount of Guarantee Type of Counter- Fulfilled to related
Name of obligee amount guarantee Guarantee date provided guarantee Collateral guarantee Term or not parties or not
Shanghai Heruiming Property 19 June 2024 7998.00 23 May 2024 7998.00 Joint and No No 1 year No No
Management Co. Ltd. several
liability
guarantee
Shanghai Heruiming Property 31 March 2025 10000.00 – – Joint and No No 1 year No No
Management Co. Ltd. several
liability
guarantee
Jilin Chenming Pulp & Fiber 28 March 2024 1000.00 24 September 1000.00 Joint and No No 1 year No No
Trading Co. Ltd. 2024 several
liability
guarantee
Jilin Chenming Pulp & Fiber 31 March 2025 5000.00 – – Joint and No No 1 year No No
Trading Co. Ltd. several
liability
guarantee
Shouguang Chenming Import 28 March 2024 43999.30 25 August 2024 43999.30 Joint and No No 1 year No No
and Export Trade Co. Ltd. several
liability
guarantee
Shouguang Chenming Import 31 March 2025 100000.00 27 June 2025 3000.00 Joint and No No 1 year No No
and Export Trade Co. Ltd. several
liability
guarantee
Hainan Chenming Technology 30 March 2023 5000.00 10 April 2024 5000.00 Joint and No No 1 year No No
Co. Ltd. several
liability
guarantee
Hainan Chenming Technology 28 March 2024 36380.85 15 October 2024 36380.85 Joint and No No 1 year No No
Co. Ltd. several
liability
guarantee
Hainan Chenming Technology 31 March 2025 80000.00 10 June 2025 3960.00 Joint and No No 1 year No No
Co. Ltd. several
liability
guarantee
Shandong Chenming Paper 31 March 2025 200000.00 – – Joint and No No 1 year No No
Sales Co. Ltd. several
liability
guarantee
SHANDONG CHENMING PAPER HOLDINGS LIMITED 53
INTERIM REPORT 2025V Material Matters
XII. Material contracts and implementation (Cont’d)
2. Significant guarantees (Cont’d)
(1) Guarantees (Cont’d)
Guarantees between the Company and its subsidiaries
Date of
the related
announcement
disclosing Guarantee
the guarantee Amount of Guarantee Type of Counter- Fulfilled to related
Name of obligee amount guarantee Guarantee date provided guarantee Collateral guarantee Term or not parties or not
Shandong Chenming Paper Co. 31 March 2025 150000.00 – – Joint and No No 1 year No No
Ltd. several
liability
guarantee
Chenming (Overseas) Co. Ltd. 31 March 2025 30000.00 – – Joint and No No 1 year No No
several
liability
guarantee
Nanchang Chenming 31 March 2025 3000.00 – – Joint and No No 1 year No No
Arboriculture Development several
Co. Ltd. liability
guarantee
Jiangxi Chenming Logistics Co. 31 March 2025 3000.00 – – Joint and No No 1 year No No
Ltd. several
liability
guarantee
Shouguang Chenming 31 March 2025 3000.00 – – Joint and No No 1 year No No
Papermaking Machine Co. several
Ltd. liability
guarantee
Shouguang Hongxiang Printing 31 March 2025 3000.00 – – Joint and No No 1 year No No
and Packaging Co. Ltd. several
liability
guarantee
Shouguang Hongyi Decorative 31 March 2025 3000.00 – – Joint and No No 1 year No No
Packaging Co. Ltd. several
liability
guarantee
Shouguang Chenming Modern 31 March 2025 3000.00 – – Joint and No No 1 year No No
Logistic Co. Ltd. several
liability
guarantee
Shandong Grand View Hotel 31 March 2025 5000.00 – – Joint and No No 1 year No No
Co. Ltd. several
liability
guarantee
Foshan Chenming Import and 31 March 2025 30000.00 – – Joint and No No 1 year No No
Export Trade Co. Ltd. several
liability
guarantee
54 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025V Material Matters
XII. Material contracts and implementation (Cont’d)
2. Significant guarantees (Cont’d)
(1) Guarantees (Cont’d)
Guarantees between the Company and its subsidiaries
Date of
the related
announcement
disclosing Guarantee
the guarantee Amount of Guarantee Type of Counter- Fulfilled to related
Name of obligee amount guarantee Guarantee date provided guarantee Collateral guarantee Term or not parties or not
Shanghai Hongtai Property 31 March 2025 10000.00 – – Joint and No No 1 year No No
Management Co. Ltd. several
liability
guarantee
Zhanjiang Chenming 31 March 2025 20000.00 – – Joint and No No 1 year No No
Technology Development Co. several
Ltd. liability
guarantee
Total amount of guarantee provided for subsidiaries approved 3668000.00 Total amount of guarantee provided for 432965.53
during the reporting period (B1) subsidiaries during the reporting period (B2)
Total amount of guarantee provided for subsidiaries approved as 5462060.64 Total balance of guarantee provided for 1890991.84
at the end of the reporting period (B3) subsidiaries as at the end of the reporting period (B4)
Guarantees between subsidiaries
Date of
the related
announcement Guarantee
disclosing to related
the guarantee Amount of Guarantee Guarantee Type of Counter- Fulfilled parties
Name of obligee amount guarantee date provided guarantee Collateral guarantee Term or not or not
Shouguang Meilun Paper Co. 31 March 2025 60000.00 – – Joint and No No 1 year No No
Ltd. several liability
guarantee
Shouguang Meilun Paper Co. 31 March 2025 30000.00 – – Joint and No No 1 year No No
Ltd. several liability
guarantee
Shanghai Chenming Pulp & 31 March 2025 70000.00 – – Joint and No No 1 year No No
Paper Sales Co. Ltd. several liability
guarantee
Huanggang Chenming Pulp & 31 March 2025 20000.00 – – Joint and No No 1 year No No
Paper Co. Ltd. several liability
guarantee
Huanggang Chenming Port 31 March 2025 3000.00 15 May 2025 600.00 Joint and No No 1 year No No
Service Co. Ltd. several liability
guarantee
Hubei Chenming Technology 31 March 2025 50000.00 – – Joint and No No 1 year No No
Industrial Co. Ltd. several liability
guarantee
SHANDONG CHENMING PAPER HOLDINGS LIMITED 55
INTERIM REPORT 2025V Material Matters
XII. Material contracts and implementation (Cont’d)
2. Significant guarantees (Cont’d)
(1) Guarantees (Cont’d)
Guarantees between subsidiaries
Date of
the related
announcement Guarantee
disclosing to related
the guarantee Amount of Guarantee Guarantee Type of Counter- Fulfilled parties
Name of obligee amount guarantee date provided guarantee Collateral guarantee Term or not or not
Jilin Chenming Pulp & Fiber 31 March 2025 3000.00 15 May 2025 1000.00 Joint and No No 1 year No No
Trading Co. Ltd. several liability
guarantee
Zhanjiang Chenming 31 March 2025 5000.00 – – Joint and No No 1 year No No
Arboriculture Development several liability
Co. Ltd. guarantee
Foshan Chenming Import and 31 March 2025 3000.00 15 May 2025 498.00 Joint and No No 1 year No No
Export Trade Co. Ltd. several liability
guarantee
Hainan Chenming Technology 31 March 2025 10000.00 – – Joint and No No 1 year No No
Co. Ltd. several liability
guarantee
Jiangxi Chenming Paper Co. 31 March 2025 1000.00 – – Joint and No No 1 year No No
Ltd. several liability
guarantee
Jiangxi Chenming Paper Co. 31 March 2025 1000.00 – – Joint and No No 1 year No No
Ltd. several liability
guarantee
Jiangxi Chenming Paper Co. 31 March 2025 1000.00 – – Joint and No No 1 year No No
Ltd. several liability
guarantee
Shandong Chenming Paper Co. 31 March 2025 5000.00 – – Joint and No No 1 year No No
Ltd. several liability
guarantee
Shandong Chenming Paper Co. 31 March 2025 50000.00 – – Joint and No No 1 year No No
Ltd. several liability
guarantee
Shandong Chenming Paper Co. 31 March 2025 20000.00 – – Joint and No No 1 year No No
Ltd. several liability
guarantee
Shandong Chenming Paper Co. 31 March 2025 15000.00 – – Joint and No No 1 year No No
Ltd. several liability
guarantee
Shandong Chenming Paper Co. 31 March 2025 20000.00 – – Joint and No No 1 year No No
Ltd. several liability
guarantee
Zhanjiang Chenming 31 March 2025 120000.00 – – Joint and No No 1 year No No
Technology Development Co. several liability
Ltd. guarantee
Zhanjiang Chenming 31 March 2025 20000.00 – – Joint and No No 1 year No No
Technology Development Co. several liability
Ltd. guarantee
56 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025V Material Matters
XII. Material contracts and implementation (Cont’d)
2. Significant guarantees (Cont’d)
(1) Guarantees (Cont’d)
Guarantees between subsidiaries
Date of
the related
announcement Guarantee
disclosing to related
the guarantee Amount of Guarantee Guarantee Type of Counter- Fulfilled parties
Name of obligee amount guarantee date provided guarantee Collateral guarantee Term or not or not
Nanchang Shengheng Trading 31 March 2025 70000.00 – – Joint and No No 1 year No No
Co. Ltd. several liability
guarantee
Nanchang Shengheng Trading 31 March 2025 20000.00 – – Joint and No No 1 year No No
Co. Ltd. several liability
guarantee
Jilin Chenming Logistics Co. 31 March 2025 30000.00 – – Joint and No No 1 year No No
Ltd. several liability
guarantee
Jilin Chenming Logistics Co. 31 March 2025 10000.00 – – Joint and No No 1 year No No
Ltd. several liability
guarantee
Huanggang Chenming Paper 25 April 2025 43915.77 – – Joint and No No 3 years No No
Technology Co. Ltd. several liability
guarantee
Total amount of guarantee provided for subsidiaries approved 680915.77 Total amount of guarantee provided for subsidiaries during the reporting period (C2) 2098.00
during the reporting period (C1)
Total amount of guarantee provided for subsidiaries approved as 680915.77 Total balance of guarantee provided for subsidiaries as at the end 2098.00
at the end of the reporting period (C3) of the reporting period (C4)
Total amount of guarantee provided (i.e. sum of the above three guarantee amount)
Total amount of guarantee approved during the reporting period 4898915.77 Total amount of guarantee during the reporting period (A2+B2+C2) 435063.53
(A1+B1+C1)
Total amount of guarantee approved as at the end of the reporting 6785734.60 Total balance of guarantee as at the end of the reporting period (A4+B4+C4) 1975488.03
period (A3+B3+C3)
The percentage of total amount of guarantee provided (i.e. A4+B4+C4) to the net assets of the Company 371.42%
Of which:
Balance of guarantee provided for shareholders beneficial controllers and its related parties (D) –
Balance of guarantee directly or indirectly provided for obligors with gearing ratio over 70% (E) 741439.35
Total amount of guarantee provided in excess of 50% of net assets (F) 1709549.87
Sum of the above three amount of guarantee (D+E+F) 2450989.22
For the unexpired guarantee contract the guarantee liability has occurred during the reporting period or there is evidence showing that it is possible to bear joint liability for No
repayment (if any)
Providing external guarantees in violation of prescribed procedures (if any) No
Details of composite guarantees
The Company and its subsidiaries jointly provided composite guarantees of RMB5679.5011 million for the
subsidiaries. To avoid duplicated calculation such amount was only listed and calculated in the guarantees
provided by the Company to its subsidiaries.SHANDONG CHENMING PAPER HOLDINGS LIMITED 57
INTERIM REPORT 2025V Material Matters
XII. Material contracts and implementation (Cont’d)
3. Entrusted wealth management
□ Applicable □ Not applicable
The Company did not have any entrusted wealth management during the reporting period.
4. Other material contracts
□ Applicable □ Not applicable
The Company did not have any other material contracts during the reporting period.XIII. Other matters of significance
□ Applicable □ Not applicable
1. Overdue of some of the debts freezing of some of the bank accounts and shutdown of production
bases
In recent years the contradiction between supply and demand in the short term has been prominent due to the
concentration of new production capacity in the paper industry coming into production. The prices of the Company’s
major paper products in particular the price of white cardboard have declined significantly under the influence of the
supply-demand contradiction. Subsequently the profit level of the Company has been continuously decreasing and
the Company has even turned from profits into losses; coupled with the situation where some financial institutions
have downsized the loan scale the Company and its subsidiaries have during certain phases faced issues of failing
to repay some debts as scheduled. In response some creditors have filed lawsuits against these debts in the court
and simultaneously applied for property preservation and the court has made a ruling to freeze some of the bank
accounts of the Company and its subsidiaries. In addition since the fourth quarter of 2024 certain production lines
of the Company have been shut down and maintained. The Company has disclosed the aforementioned matters in
accordance with the relevant requirements of the Rules Governing Listing of Stocks on Shenzhen Stock Exchange. As
at the end of the reporting period the Company’s cumulative overdue debts amounted to RMB3.821 billion with 332
bank accounts frozen. The cumulative frozen amount of the frozen bank accounts amounted to RMB39.3805 million
(excluding deposits). Certain production lines of the Company were still shut down and maintained.For details please refer to the relevant announcements disclosed by the Company on CNINFO on 20 November 2024
21 December 2024 24 January 2025 and 1 April 2025 (Announcements No.: 2024-073 2024-079 2025-003 and
2025-031) and the announcements disclosed by the Company on the website of Hong Kong Stock Exchange on 19
November 2024 20 December 2024 23 January 2025 and 31 March 2025.
58 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025V Material Matters
XIII. Other matters of significance (Cont’d)
2. Postponement of the elections of the new sessions of the Board and the Supervisory Committee
The terms of office of the tenth sessions of the Board and the Supervisory Committee of the Company expired on 15
June 2025. In the light of among others the requirements of the Guidelines for the Articles of Association of Listed
Companies and the Transitional Arrangements for the Implementation of the Supporting Rules of the New Company
Law issued by the China Securities Regulatory Commission and the amended supporting rules of Shenzhen Stock
Exchange the Company proposed to systematically amend its Articles of Association and the related internal system
and to hold elections of the new sessions. In order to ensure the continuity and stability of the work of the Board and
the Supervisory Committee of the Company the re-election of the tenth sessions of the Board and the Supervisory
Committee of the Company was postponed and the terms of office of various special committees under the Board
and the Senior Management were extended accordingly. Before the completion of the elections of the new sessions all
members of the tenth sessions of the Board and the Supervisory Committee and special committees under the Board
of the Company and the Senior Management continue to perform their respective duties and obligations in accordance
with among others relevant laws and regulations as well as the Rules Governing Listing of Stocks on Shenzhen Stock
Exchange and the Articles of Association. As of the end of the reporting period the Company was actively preparing
the amendments to the relevant systems of the Company and the elections of the new sessions.For details please refer to the relevant announcement disclosed by the Company on CNINFO on 14 June 2025
(Announcement No.: 2025-045) and the announcement disclosed by the Company on the website of Hong Kong Stock
Exchange on 13 June 2025.
3. Information disclosure index for 2025 Interim Report
Announcement Date of Publication
No. Subject matter publication website and index
2025-001 Announcement on Partial Release of Pledge of Shares and Re- 3 January 2025 http://www.cninfo.com.cn
Pledge of Shares of Shareholder
2025-002 Announcement on Partial Release of Pledge of Shares and Pledge 24 January 2025 http://www.cninfo.com.cn
and Freezing of Shares of Shareholder
2025-003 Announcement in Relation to Among Others the Progress in 24 January 2025 http://www.cninfo.com.cn
Temporary Shutdown and Maintenance of Certain Production
Bases and Cumulative Litigation
2025-004 2024 Annual Results Forecast 24 January 2025 http://www.cninfo.com.cn
2025-005 Announcement on Progress of Dissolution of Shandong Chenming 15 February 2025 http://www.cninfo.com.cn
Group Finance Co. Ltd.
2025-006 Announcement on Imposition of Other Risk Warnings in Respect of 20 February 2025 http://www.cninfo.com.cn
Shares of the Company and Suspension of Trading in Shares of
the Company
2025-007 Announcement on Unusual Price Movement of Shares of the 26 February 2025 http://www.cninfo.com.cn
Company
SHANDONG CHENMING PAPER HOLDINGS LIMITED 59
INTERIM REPORT 2025V Material Matters
XIII. Other matters of significance (Cont’d)
3. Information disclosure index for 2025 Interim Report (Cont’d)
Announcement Date of Publication
No. Subject matter publication website and index
2025-008 Announcement on New Cumulative Litigation 1 March 2025 http://www.cninfo.com.cn
2025-009 Announcement on Progress of Equity Transfer of Subsidiary and 15 March 2025 http://www.cninfo.com.cn
Related Party Transaction
2025-010 Announcement on Judicial Freeze and Waiting Freeze of Shares 15 March 2025 http://www.cninfo.com.cn
Held by Shareholders
2025-011 2024 Annual Report Summary 1 April 2025 http://www.cninfo.com.cn
2025-012 Announcement on Resolutions of the Twelfth Meeting of the Ten 1 April 2025 http://www.cninfo.com.cn
Session of the Board of Directors
2025-013 Announcement on Resolutions of the Twelfth Meeting of the Ten 1 April 2025 http://www.cninfo.com.cn
Session of the Supervisory Committee
2025-014 Notice of 2024 Annual General Meeting 1 April 2025 http://www.cninfo.com.cn
2025-015 Announcement on the 2024 Annual Online Performance Briefing 1 April 2025 http://www.cninfo.com.cn
2025-016 Special Statement on Securities Investment in 2024 1 April 2025 http://www.cninfo.com.cn
2025-017 Announcement on Proposed Non-distribution of Profit for 2024 1 April 2025 http://www.cninfo.com.cn
2025-018 Announcement on Carrying out Factoring Business of Accounts 1 April 2025 http://www.cninfo.com.cn
Receivable
2025-019 Announcement on Development of Equipment Financing Business 1 April 2025 http://www.cninfo.com.cn
2025-020 Announcement on Expected Provision of Guarantees to Subsidiaries 1 April 2025 http://www.cninfo.com.cn
for 2025
2025-021 Announcement on Re-appointment of Auditor for 2025 1 April 2025 http://www.cninfo.com.cn
2025-022 Announcement on Estimated Day-to-day Related Party Transactions 1 April 2025 http://www.cninfo.com.cn
for 2025
2025-023 Announcement on Changes in Accounting Policies 1 April 2025 http://www.cninfo.com.cn
2025-024 Special Statement of the Board of Directors on Matters Related to 1 April 2025 http://www.cninfo.com.cn
the 2024 Audit Report
2025-025 Special Statement of the Board of Directors on Matters Related to 1 April 2025 http://www.cninfo.com.cn
the 2024 Internal Control Audit Report
2025-026 The Opinion of the Supervisory Committee on the Special Statement 1 April 2025 http://www.cninfo.com.cn
of the Board of Directors on Matters Related to the 2024 Audit
Report
2025-027 The Opinion of the Supervisory Committee on the Special Statement 1 April 2025 http://www.cninfo.com.cn
of the Board of Directors on Matters Related to the 2024 Internal
Control Audit Report
60 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025V Material Matters
XIII. Other matters of significance (Cont’d)
3. Information disclosure index for 2025 Interim Report (Cont’d)
Announcement Date of Publication
No. Subject matter publication website and index
2025-028 Announcement on Imposition of Other Risk Warnings in Respect of 1 April 2025 http://www.cninfo.com.cn
Shares of the Company
2025-029 Valuation Enhancement Plan 1 April 2025 http://www.cninfo.com.cn
2025-030 Announcement on the Waiting Freeze of Shares Held by 1 April 2025 http://www.cninfo.com.cn
Shareholders
2025-031 Announcement on Cumulative Newly Overdue Debts 1 April 2025 http://www.cninfo.com.cn
2025-032 Indicative Announcement on Change in Shareholding of Controlling 12 April 2025 http://www.cninfo.com.cn
Shareholder
2025-033 Announcement on the Partial Release of Pledge of Shares of 12 April 2025 http://www.cninfo.com.cn
Shareholder and the New Waiting Freeze
2025-034 Announcement on New Cumulated Litigation 12 April 2025 http://www.cninfo.com.cn
2025-035 Announcement on Resolutions of the Twentieth Extraordinary 26 April 2025 http://www.cninfo.com.cn
Meeting of the Tenth Session of the Board of Directors
2025-036 Announcement on External Guarantees Provided by the Company 26 April 2025 http://www.cninfo.com.cn
and its Majority-owned Subsidiaries
2025-037 Announcement on the Termination of Construction of Huanggang 26 April 2025 http://www.cninfo.com.cn
Chenming Phase II Project
2025-038 Announcement on the Transfer of Non-Controlling Shareholding in 26 April 2025 http://www.cninfo.com.cn
a Subsidiary of the Company to Huanggang Technology and the
Provision of Guarantee by Huanggang Chenming
2025-039 Announcement on the Addition of Temporary Proposals to the 2024 26 April 2025 http://www.cninfo.com.cn
Annual General Meeting and Supplementary Notice of the General
Meeting
2025-040 2025 First Quarterly Report 30 April 2025 http://www.cninfo.com.cn
2025-041 Announcement on Participating in the 2025 Online Collective 14 May 2025 http://www.cninfo.com.cn
Reception Day for Investors of Listed Companies in Shandong
2025-042 Results of the 2024 Annual General Meeting 16 May 2025 http://www.cninfo.com.cn
2025-043 Announcement on Progress of Provision of Guarantee to a 16 May 2025 http://www.cninfo.com.cn
Subsidiary
2025-044 Announcement on New Cumulated Litigation 24 May 2025 http://www.cninfo.com.cn
2025-045 Indicative Announcement on Postponement of Election of the Board 14 June 2025 http://www.cninfo.com.cn
of Directors and the Supervisory Committee
2025-046 Announcement on Progress of Litigation 28 June 2025 http://www.cninfo.com.cn
SHANDONG CHENMING PAPER HOLDINGS LIMITED 61
INTERIM REPORT 2025V Material Matters
XIV. Matters of significant of subsidiaries of the Company
□ Applicable □ Not applicable
1. Dissolution of Shandong Chenming Group Finance Co. Ltd.
On 14 August 2024 the Resolution on Dissolution of Shandong Chenming Group Finance Co. Ltd. was considered
and approved at the tenth meeting of the tenth session of the Board convened by the Company pursuant to which the
Board of the Company agreed to authorise the management of the Company to deal with the matters relating to the
dissolution of Shandong Chenming Group Finance Co. Ltd.On 12 February 2025 Shandong Chenming Group Finance Co. Ltd. received the Approval of the National Financial
Regulatory Administration on the Dissolution of Shandong Chenming Group Finance Co. Ltd. (Jin Fu [2025] No. 86)
which approved the dissolution of Shandong Chenming Group Finance Co. Ltd. Shandong Chenming Group Finance
Co. Ltd. will complete the relevant procedures in accordance with the requirements of relevant laws and regulations.For relevant details please refer to the relevant announcements disclosed by the Company on CNINFO on 15 August
2024 and 15 February 2025 (announcement number: 2024-047 and 2025-005) and the announcements disclosed by the
Company on the website of Hong Kong Stock Exchange on 14 August 2024 and 14 February 2025.
2. Termination of construction of Huanggang Chenming Phase II Project
On 25 April 2025 and 15 May 2025 the Resolution on Termination of Construction of Huanggang Chenming Phase
II Project was considered and approved at the twentieth extraordinary meeting of the tenth session of the Board
and the 2024 annual general meeting respectively. In view of market changes and its current operations in order to
avoid further impact of capital expenditures on liquidity and to effectively safeguard the interests of the Company and
all shareholders based on the principle of prudence the Company terminated the construction of the Huanggang
Chenming Phase II Project.For relevant details please refer to the relevant announcements disclosed by the Company on CNINFO on 26 April 2025
and 16 May 2025 (announcement number: 2025-037 and 2025-042) and the announcements disclosed by the Company
on the website of Hong Kong Stock Exchange on 25 April 2025 and 15 May 2025.
62 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VI Changes in Share Capital and Shareholders
I. Changes in shares
1. Changes in shares
Unit: share
Opening balance Change during the reporting period (+/-) Closing balance
Shares
converted
Amount Percentage New issue Bonus issue from reserves Others Subtotal Amount Percentage
I. Restricted shares 30941154 1.05% 0 0 0 -5562842 -5562842 25378312 0.86%
1. Shares held by other domestic
investors 30941154 1.05% 0 0 0 -5562842 -5562842 25378312 0.86%
Including: Shares held by domestic
natural persons 30941154 1.05% 0 0 0 -5562842 -5562842 25378312 0.86%
II. Non-restricted shares 2910515046 98.95% 0 0 0 5562842 5562842 2916077888 99.14%
1. RMB ordinary shares 1675824530 56.97% 0 0 0 5562842 5562842 1681387372 57.16%
2. Domestic listed foreign shares 706385266 24.01% 0 0 0 0 0 706385266 24.01%
3. Overseas listed foreign shares 528305250 17.96% 0 0 0 0 0 528305250 17.96%
III. Total number of shares 2941456200 100.00% 0 0 0 0 0 2941456200 100.00%
The reasons for such changes
□ Applicable □ Not applicable
The Shenzhen Branch of China Securities Depository and Clearing Corporation Limited recalculated the statutory
quota of transferable shares for the Directors Supervisors and Senior Management of the Company this year at 25%
on the first trading day of this year based on the shares of the Company registered under the names of its Directors
Supervisors and Senior Management on the last trading day of the previous year. Besides certain Directors and Senior
Management of the Company have resigned for more than 6 months resulting in a change in the locked-up shares
of Senior Management. Hence restricted shares decreased by 5562842 RMB ordinary shares in aggregate while
non-restricted shares increased by 5562842 RMB ordinary shares in aggregate.Approval of changes in shareholding
□ Applicable □ Not applicable
Transfer of shares arising from changes in shareholding
□ Applicable □ Not applicable
Progress of share repurchase
□ Applicable □ Not applicable
Progress of decrease in the holding of repurchased shares by way of bidding
□ Applicable □ Not applicable
The effects of changes in shareholding on financial indicators such as basic earnings per share diluted earnings per
share and net assets per share attributable to ordinary shareholders of the Company for the latest year and the latest
period
□ Applicable □ Not applicable
Other information considered necessary by the Company or required by the securities regulatory authorities to be
disclosed
□ Applicable □ Not applicable
SHANDONG CHENMING PAPER HOLDINGS LIMITED 63
INTERIM REPORT 2025VI Changes in Share Capital and Shareholders
I. Changes in shares (Cont’d)
2. Changes in restricted shares
□ Applicable □ Not applicable
Unit: share
Restricted Restricted
Restricted shares shares Restricted
shares at the released increased shares at the
Name of beginning of during the during the end of the Date of release
shareholder the period period period period Reason for restriction from restriction
Hu Changqing 219643 0 375000 594643 Locked-up shares of In accordance with relevant
Directors Supervisors and requirements for shares held by
Senior Management Directors Supervisors and Senior
Management
Li Xingchun 1125000 0 375000 1500000 Locked-up shares of In accordance with relevant
Directors Supervisors and requirements for shares held by
Senior Management Directors Supervisors and Senior
Management
Li Weixian 121575 0 150000 271575 Locked-up shares of In accordance with relevant
Directors Supervisors and requirements for shares held by
Senior Management Directors Supervisors and Senior
Management
Li Feng 792020 0 225000 1017020 Locked-up shares of In accordance with relevant
Directors Supervisors and requirements for shares held by
Senior Management Directors Supervisors and Senior
Management
Li Kang 111975 0 0 111975 Locked-up shares of In accordance with relevant
Directors Supervisors and requirements for shares held by
Senior Management Directors Supervisors and Senior
Management
Li Zhenzhong 409800 0 150000 559800 Locked-up shares of In accordance with relevant
Directors Supervisors and requirements for shares held by
Senior Management Directors Supervisors and Senior
Management
Li Mingtang 37500 0 75000 112500 Locked-up shares of In accordance with relevant
Directors Supervisors and requirements for shares held by
Senior Management Directors Supervisors and Senior
Management
Dong Lianming 37500 0 75000 112500 Locked-up shares of In accordance with relevant
Directors Supervisors and requirements for shares held by
Senior Management Directors Supervisors and Senior
Management
Yuan Xikun 44775 0 22500 67275 Locked-up shares of In accordance with relevant
Directors Supervisors and requirements for shares held by
Senior Management Directors Supervisors and Senior
Management
Chen Hongguo 19080044 6270011 0 12810033 Locked-up shares of On 6 May 2025 the lock-up ratio
Directors Supervisors and was adjusted from 100% to 75%.Senior Management
64 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VI Changes in Share Capital and Shareholders
I. Changes in shares (Cont’d)
2. Changes in restricted shares (Cont’d)
Restricted Restricted
Restricted shares shares Restricted
shares at the released increased shares at the
Name of beginning of during the during the end of the Date of release
shareholder the period period period period Reason for restriction from restriction
6000000 0 0 6000000 Restricted shares of the The Company made payment
participants of the Share for the repurchase of 6000000
Incentive Scheme restricted shares under the Share
Incentive Scheme on 1 November
2024.
The share repurchase transfer
and cancellation of such restricted
shares with the Shenzhen Branch
of China Securities Depository and
Clearing Corporation Limited were
not completed by the Company as
they were subject to judicial freeze.Li Xueqin 2061322 740331 0 1320991 Locked-up shares of On 6 May 2025 the lock-up ratio
Directors Supervisors and was adjusted from 100% to 75%.Senior Management
900000 0 0 900000 Restricted shares of the The Company made payment
participants of the Share for the repurchase of 900000
Incentive Scheme restricted shares under the Share
Incentive Scheme on 1 November
2024.
The share repurchase transfer
and cancellation of such restricted
shares with the Shenzhen Branch
of China Securities Depository and
Clearing Corporation Limited were
not completed by the Company as
they were subject to judicial freeze.Total 30941154 7010342 1447500 25378312 － －
II. Issuance and listing of securities
□ Applicable □ Not applicable
SHANDONG CHENMING PAPER HOLDINGS LIMITED 65
INTERIM REPORT 2025VI Changes in Share Capital and Shareholders
III. Total number of shareholders and shareholdings
Unit: share
Total number of ordinary 117668 of which 99783 were Total number of holders of 0
shareholders as at the end holders of A shares 17568 preference shares with
of the reporting period were holders of B shares and restored voting right as at
317 were holders of H shares the end of the reporting period
Shareholdings of shareholders interested in more than 5% of the shares of the Company or Top 10 shareholders (excluding the shares lent under refinancing business)
Changes
Number of (increase or
shares held decrease) Share pledged marked
at the end of during the Number of Number of or frozen
Percentage of the reporting reporting restricted non-restricted Status of
Name of shareholder Nature of shareholder shareholding period period shares held shares held shares Number
CHENMING HOLDINGS COMPANY LIMITED State-owned legal person 15.50% 455781319 0 0 455781319 Pledged 386811546
Frozen 409956441
HKSCC NOMINEES LIMITED Overseas legal person 12.69% 373409775 43750 0 373409775 N/A 0
CHENMING HOLDINGS (HONG KONG) Overseas legal person 12.38% 364131563 0 0 364131563 N/A 0
LIMITED (Note 1)
Jin Xing Domestic natural person 1.27% 37385427 23347631 0 37385427 N/A 0
Chen Hongguo (Note 2) Domestic natural person 0.65% 19080044 0 12810033 6270011 Frozen 19080044
Ji Zhongqiu Domestic natural person 0.23% 6887174 679000 0 6887174 N/A 0
Xu Hekun Domestic natural person 0.23% 6789900 0 0 6789900 N/A 0
GUOTAI JUNAN SECURITIES (HONG KONG) Overseas legal person 0.20% 5961570 -449000 0 5961570 N/A 0
LIMITED
Zou Shilin Domestic natural person 0.20% 5908307 3412407 0 5908307 N/A 0
VANGUARD TOTAL INTERNATIONAL Overseas legal person 0.19% 5533559 -9238386 0 5533559 N/A 0
STOCK INDEX FUND
Strategic investors or general legal persons who become the top ten Nil
shareholders due to the placement of new shares
Related party relationship or acting in concert among the above shareholders A shareholder Chenming Holdings (Hong Kong) Limited which is an overseas legal person is a wholly-
owned subsidiary of a shareholder Chenming Holdings Company Limited which is a state-owned legal
person. Save for the above it is not aware that any other shareholders of tradable shares are persons acting
in concert. It is also not aware that any other shareholders of tradable shares are related to each other.Explanation of the aforementioned shareholders’ entrusted/entrusted voting rights and waiver of Nil
voting rights
Special explanation for designated repurchase accounts among the top ten shareholders In November 2024 pursuant to the 2020 Restricted A Share Incentive Scheme (Draft) the Company made
payments for the repurchase of restricted shares not yet unlocked for the third unlocking period under
the 2020 Restricted A Share Incentive Scheme. In the process of completing the procedures for the share
transfer and cancellation the 6000000 restricted shares held by Mr. Chen Hongguo were judicially frozen.Hence the procedures for the transfer and cancellation of such restricted shares were not yet completed with
the Shenzhen Branch of China Securities Depository and Clearing Corporation Limited.The 19080044 shares held by Mr. Chen Hongguo being a domestic natural person excludes the 6000000
restricted shares under the share incentive scheme.
66 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VI Changes in Share Capital and Shareholders
III. Total number of shareholders and shareholdings (Cont’d)
Shareholdings of the top ten non-restricted shareholders
(excluding the shares lent under refinancing business and the locked-up shares of the Senior Management)
Number of
non-restricted
shares held as
at the end of
the reporting Class of shares
Name of shareholder period Class of shares Number
CHENMING HOLDINGS COMPANY LIMITED 455781319 RMB ordinary shares 455781319
HKSCC NOMINEES LIMITED 373409775 Overseas listed foreign shares 373409775
CHENMING HOLDINGS (HONG KONG) LIMITED (Note 1) 364131563 Domestic listed foreign shares 210717563
Overseas listed foreign shares 153414000
Jin Xing 37385427 Domestic listed foreign shares 37385427
Ji Zhongqiu 6887174 RMB ordinary shares 6887174
Xu Hekun 6789900 Domestic listed foreign shares 6789900
Chen Hongguo (Note 2) 6270011 RMB ordinary shares 6270011
GUOTAI JUNAN SECURITIES (HONG KONG) LIMITED 5961570 Domestic listed foreign shares 5961570
Zou Shilin 5908307 Domestic listed foreign shares 5908307
VANGUARD TOTAL INTERNATIONAL 5533559 Domestic listed foreign shares 5533559
STOCK INDEX FUND
Related party relationship or acting in concert among A shareholder Chenming Holdings (Hong Kong) Limited which
the top ten shareholders of non-restricted shares and is an overseas legal person is a wholly-owned subsidiary of a
between the top ten shareholders of non-restricted shareholder Chenming Holdings Company Limited which is a state-
shares and the top ten shareholders owned legal person. Save for the above it is not aware that any
other shareholders of tradable shares are persons acting in concert.It is also not aware that any other shareholders of tradable shares
are related to each other.Securities margin trading of top ten ordinary Chenming Holdings Company Limited held 455781319 RMB
Shareholders ordinary shares of which 409956441 shares were held through
ordinary account and 45824878 shares were held through credit
guarantee security account.Note 1: In order to meet its own capital needs Chenming Holdings (Hong Kong) Limited conducted share financing business with overseas institutions
entrusting 210717563 B shares and 153414000 H shares of the Company held by it to the custody brokerage designated by overseas
institutions. The aforesaid shares were subject to the risk of not to be recovered which may lead to a reduction in the Company’s shareholding
but does not affect Chenming Holdings’ position as the largest shareholder and does not affect the Company’s control. For details please
refer to the announcement disclosed by the Company on CNINFO on 18 July 2023 (announcement no.: 2023-058) and the insider information
disclosed by the Company on the website of Hong Kong Stock Exchange on 18 July 2023.Note 2: On 1 November 2024 pursuant to the 2020 Restricted A Share Incentive Scheme (Draft) the Company made payments to the participants for
the repurchase of restricted shares not yet unlocked for the third unlocking period under the 2020 Restricted A Share Incentive Scheme. In the
process of completing the procedures for the share transfer and cancellation the 6000000 restricted shares held by Mr. Chen Hongguo were
judicially frozen. Hence the procedures for the transfer and cancellation of such restricted shares were not yet completed with the Shenzhen
Branch of China Securities Depository and Clearing Corporation Limited. The 19080044 shares held by Mr. Chen Hongguo being a domestic
natural person excludes the 6000000 restricted shares to be cancelled under the share incentive scheme.SHANDONG CHENMING PAPER HOLDINGS LIMITED 67
INTERIM REPORT 2025VI Changes in Share Capital and Shareholders
III. Total number of shareholders and shareholdings (Cont’d)
Share lending by shareholders interested in more than 5% top 10 shareholders and top 10 shareholders of
non-restricted shares under refinancing business
□ Applicable □ Not applicable
Changes of top 10 shareholders and top 10 shareholders of non-restricted shares due to lending/returning of
shares under refinancing business as compared to prior period
□ Applicable □ Not applicable
Whether an agreed repurchase transaction was entered into during the reporting period by the top 10
ordinary shareholders and top 10 non-restricted ordinary shareholders of the Company
□ Yes □ No
The top 10 ordinary shareholders and top 10 non-restricted ordinary shareholders of the Company did not enter into any
agreed repurchase transaction during the reporting period.IV. Changes in shareholding of Directors Supervisors and Senior Management
□ Applicable □ Not applicable
There was no change in the shareholding of the Directors Supervisors and Senior Management of the Company during the
reporting period. Please see the 2024 annual report for details.V. Change of controlling shareholders or beneficial controllers
Change of controlling shareholders during the reporting period
□ Applicable □ Not applicable
There was no change of controlling shareholders of the Company during the reporting period.Change of beneficial controllers during the reporting period
□ Applicable □ Not applicable
There was no change of beneficial controllers of the Company during the reporting period.VI. Preference shares
□ Applicable □ Not applicable
The Company had no preference shares during the reporting period.
68 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VI Changes in Share Capital and Shareholders
VII. Securities interests held by Directors Supervisors and chief executives disclosed in
accordance with the Listing Rules of Hong Kong Stock Exchange
As at 30 June 2025 the interests and short positions held by each of the Directors Supervisors and chief executives of the
Company in the shares underlying shares and debentures of the Company or its associated corporations (within the meaning
of Part XV of the Securities and Futures Ordinance (Chapter 571 of the laws of Hong Kong) (the “SFO”)) as recorded in the
register required to be kept under section 352 of the SFO are set out as follows:
Company
Number of shares
(A shares) held as at As a percentage
the end of the reporting of the total shares
Name Position period (shares) of the Company
Directors
Hu Changqing Chairman 792857 0.03%
Li Xingchun Executive Director and vice chairman 2000000 0.07%
Li Weixian Executive Director and general manager 362100 0.01%
Li Feng Executive Director and deputy general manager 1356027 0.05%
Han Tingde Non-executive Director – –
Li Chuanxuan Non-executive Director – –
Sun Jianfei Independent non-executive Director – –
Yin Meiqun Independent non-executive Director – –
Yang Biao Independent non-executive Director – –
Li Zhihui Independent non-executive Director – –
Supervisors
Li Kang Chairman of the Supervisory Committee 149300 0.01%
Pan Ailing Supervisor – –
Zhang Hong Supervisor – –
Sang Ailing Supervisor – –
Qiu Lanju Supervisor – –
Save as disclosed above as at 30 June 2025 none of the Directors Supervisors or chief executives of the Company had
any interests or short positions in the shares underlying shares or debentures of the Company or any of its associated
corporations which were required to be filed in the register of the Company required to be maintained pursuant to section 352
of the SFO or which were required to be notified to the Company and the Hong Kong Stock Exchange pursuant to the Model
Code for Securities Transactions by Directors of Listed Issuers as contained in Appendix C3 to the Listing Rules of Hong Kong
Stock Exchange.As at 30 June 2025 none of the Directors Supervisors or chief executives or their respective spouses or children under the
age of 18 held or exercised any rights to subscribe for the share capital or debentures of the Company or its associated
corporations.SHANDONG CHENMING PAPER HOLDINGS LIMITED 69
INTERIM REPORT 2025VI Changes in Share Capital and Shareholders
VIII. Interests and short position of substantial shareholders in shares and underlying shares
disclosed in accordance with the Listing Rules of Hong Kong Stock Exchange
As at 30 June 2025 the following shareholders (other than the Directors Supervisors or chief executives of the Company) had
interests or short positions in the Company’s shares and underlying shares as shown in the share register maintained by the
Company in accordance with Section 336 of the SFO:
Approximate shareholding
as a percentage of
Number of shares Total share Class of
Name held (shares) capital (%) shares (%)
Chenming Holdings Company Limited 455781319 A shares (L) 15.50 26.70
Chenming Holdings (Hong Kong) Limited 210717563 B shares (L) 7.16 29.83
Chenming Holdings (Hong Kong) Limited 153414000 H shares (L) 5.22 29.04
(L) – Long position (S) – Short position (P) – Lending pool
Save as disclosed above as at 30 June 2025 no other person had interests or short positions in the Company’s shares and
underlying shares as recorded in the register maintained under section 336 of the SFO.
70 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VII Bonds
□ Applicable □ Not applicable
SHANDONG CHENMING PAPER HOLDINGS LIMITED 71
INTERIM REPORT 2025VIII Financial Report
I. Auditors’ Report
Is the interim report audited
□ Yes √ No
The interim financial report is unaudited.II. Financial Statements
The unit in the notes to the financial statements is: RMB
1. Consolidated Balance Sheet
Prepared by: Shandong Chenming Paper Holdings Limited
30 June 2025
Unit: RMB
Item Closing balance Opening balance
CURRENT ASSETS:
Monetary funds 953661496.60 5909879812.18
Financial assets held for trading 36692409.73 37259325.70
Bills receivable 765000567.09 506605701.74
Accounts receivable 930731502.52 1384290313.70
Accounts receivable financing 92166113.62 100730797.32
Prepayments 514712024.36 631893495.14
Other receivables 826493097.36 1084651870.94
Including: Interest receivable – –
Dividend receivable – 22659149.81
Inventories 2522316388.43 2835388802.15
Including: Data resources – –
Non-current assets due within one year 2393909142.54 2840365519.48
Other current assets 337591186.03 559911202.83
Total current assets 9373273928.28 15890976841.18
NON-CURRENT ASSETS:
Long-term receivables 385116643.83 280291802.55
Long-term equity investments 3621265404.11 3971035411.54
Other non-current financial assets 344266989.06 751030454.68
Investment property 5502917303.30 5743235268.46
Fixed assets 30486711545.01 31855069324.04
Construction in progress 610870896.53 593838603.87
Bearer biological assets 9383299.52 9352071.80
Right-of-use assets 256595832.65 266024312.87
Intangible assets 1626560950.12 1652267783.57
Including: Data resources – –
Long-term prepaid expenses 262077437.53 289677546.87
Deferred income tax assets 1786515436.57 1790639019.23
Other non-current assets 433320325.23 415856701.42
Total non-current assets 45325602063.46 47618318300.90
Total assets 54698875991.74 63509295142.08
72 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
II. Financial Statements (Cont’d)
1. Consolidated Balance Sheet (Cont’d)
Item Closing balance Opening balance
CURRENT LIABILITIES:
Short-term borrowings 23326218453.95 26780358809.11
Bills payable 107370000.00 1423918112.99
Accounts payable 8426902071.31 7708967406.47
Receipts in advance 48105994.72 54538940.24
Contract liabilities 189324752.36 274829824.35
Employee benefits payable 314062480.34 251387660.00
Taxes payable 168781787.11 193424339.67
Other payables 3560628293.65 2896409953.94
Including: Interest payable 248725295.32 63042283.31
Dividend payable 97493880.88 123000000.00
Non-current liabilities due within one year 2534511114.58 1577936964.14
Other current liabilities 844340067.04 2680562600.58
Total current liabilities 39520245015.06 43842334611.49
NON-CURRENT LIABILITIES:
Long-term borrowings 3701926679.84 4763662194.24
Lease liabilities 36460994.21 37092473.06
Long-term payables 2544988247.10 774965008.29
Provisions 5935000.00 5935000.00
Deferred income 1189563716.54 1240939485.52
Deferred income tax liabilities 4702287.70 8595744.33
Total non-current liabilities 7483576925.39 6831189905.44
Total liabilities 47003821940.45 50673524516.93
SHAREHOLDERS’ EQUITY:
Share capital 2934556200.00 2934556200.00
Capital reserves 5241279229.79 5207678622.75
Less: Treasury shares – –
Other comprehensive income -929728593.54 -913708670.15
Special reserves 29831855.86 26800491.53
Surplus reserves 1212009109.97 1212009109.97
General risk provisions 80950584.11 80950584.11
Retained profit -3250135169.86 607818020.70
Total equity attributable to shareholders of the Company 5318763216.33 9156104358.91
Minority interest 2376290834.96 3679666266.24
Total shareholders’ (or owners’) equity 7695054051.29 12835770625.15
Total liabilities and shareholders’ (or owners’) equity 54698875991.74 63509295142.08
Legal Representative: Financial controller: Head of the financial department:
Hu Changqing Dong Lianming Zhang Bo
SHANDONG CHENMING PAPER HOLDINGS LIMITED 73
INTERIM REPORT 2025VIII Financial Report
II. Financial Statements (Cont’d)
2. Balance sheet of the Company
Unit: RMB
Item Closing balance Opening balance
CURRENT ASSETS:
Monetary funds 255089103.39 1599326584.12
Bills receivable 356030.64 275500130.56
Accounts receivable 2130011722.06 240787940.24
Prepayments 343788881.62 1221574612.38
Other receivables 5728847164.46 8459731199.92
Including: Interest receivable – –
Dividend receivable 142500000.00 –
Inventories 237170049.31 279754637.58
Including: Data resources – –
Other current assets 13034342.76 38776511.95
Total current assets 8708297294.24 12115451616.75
NON-CURRENT ASSETS:
Long-term equity investments 16703749202.44 18587172933.97
Other non-current financial assets 101028728.82 101028728.82
Fixed assets 3119164860.74 3286823373.00
Construction in progress 7884948.09 6526025.52
Right-of-use assets 99375000.00 103125000.00
Intangible assets 454942655.32 462060836.20
Including: Data resources – –
Deferred income tax assets 638718747.44 587532690.79
Other non-current assets 12021421.38 12030680.01
Total non-current assets 21136885564.23 23146300268.31
Total assets 29845182858.47 35261751885.06
CURRENT LIABILITIES:
Short-term borrowings 11107038759.41 8760304513.03
Bills payable 28199999.92 4776895581.73
Accounts payable 1500416791.08 1494669551.89
Contract liabilities 708458794.41 1795549425.10
Employee benefits payable 90391584.10 83931485.87
Taxes payable 30222353.27 40921701.99
Other payables 3208515881.54 3679222270.99
Including: Interest payable 117545476.66 22581097.56
Dividend payable – –
Non-current liabilities due within one year 1112509117.39 1329838949.85
Other current liabilities – 59111611.53
Total current liabilities 17785753281.12 22020445091.98
74 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
II. Financial Statements (Cont’d)
2. Balance sheet of the Company (Cont’d)
Item Closing balance Opening balance
NON-CURRENT LIABILITIES:
Long-term borrowings 432370925.96 1548277044.45
Long-term payables 71921255.93 8106807.57
Provisions 5935000.00 5935000.00
Deferred income 32925098.44 34010344.36
Total non-current liabilities 543152280.33 1596329196.38
Total liabilities 18328905561.45 23616774288.36
SHAREHOLDERS’ EQUITY:
Share capital 2934556200.00 2934556200.00
Capital reserves 5005865917.53 5032163419.19
Less: Treasury shares – –
Special reserves 7405266.87 7405266.87
Surplus reserves 1199819528.06 1199819528.06
Retained profit 2368630384.56 2471033182.58
Total shareholders’ (or owners’) equity 11516277297.02 11644977596.70
T otal liabilities and shareholders’ (or owners’) equity 29845182858.47 35261751885.06
SHANDONG CHENMING PAPER HOLDINGS LIMITED 75
INTERIM REPORT 2025VIII Financial Report
II. Financial Statements (Cont’d)
3. Consolidated Income Statement
Unit: RMB
Item First half of 2025 First half of 2024
I. Total revenue 2106630952.30 13884731519.04
Including: Revenue 2106630952.30 13884731519.04
II. Total operating costs 4968507848.84 14187361954.59
Including: Operating costs 3727203720.24 12185505709.00
Taxes and surcharges 61186804.84 116747402.65
Sales and distribution expenses 51113266.56 99303831.21
General and administrative expenses 287771131.26 317435416.15
Research and development expense 36567185.69 611914096.41
Finance expenses 804665740.25 856455499.17
Including: Interest expenses 774744373.14 854610967.90
Interest income 26462669.15 104024655.22
Add: Other income 22794816.03 159945128.64
Investment income (“-” denotes loss) -430669782.44 181332096.11
Including: Inv estment income from associates and joint
ventures -345974520.50 -38682172.19
Gai ns on derecognition of financial assets
measured at amortised cost
(“-” denotes loss) -84861658.28 -23412008.23
Gain on change in fair value (“-” denotes loss) -129487561.79 -2221596.44
Credit impairment loss (“-” denotes loss) -506322424.22 -124386619.66
Lo ss on impairment of assets
(“-” denotes loss) -240561409.32 -3041427.75
Gain on disposal of assets (“-” denotes loss) -9814609.63 19222812.60
III. Operating profit (“-” denotes loss) -4155937867.91 -71780042.05
Add: Non-operating income 1069763.18 2751486.93
Less: Non-operating expenses 26198489.55 1013551.00
IV. Total profit (“-” denotes total loss) -4181066594.28 -70042106.12
Less: Income tax expenses 3603600.91 -96400954.34
V. Net profit (“-” denotes net loss) -4184670195.19 26358848.22
(i) Classification according to the continuity of operation: – –
1. Net profit from continuing operations (“-” denotes
net loss) -4184670195.19 26358848.22
2. Net profit from discontinued operations (“-”
denotes net loss) – –
(ii) Classification according to ownership: – –
1. Net profit attributable to shareholders of the
Company (“-” denotes net loss) -3857953190.56 28646205.42
2. Profit or loss of minority interest (“-” denotes net
loss) -326717004.63 -2287357.20
VI. Net other comprehensive income after tax -16019923.39 -15535759.27
Net other comprehensive income after tax attributable to
shareholders of the Company -16019923.39 -15535759.27
(i) Other comprehensive income that cannot be reclassified
to profit and loss – –
(ii) Other comprehensive income that will be reclassified to
profit and loss -16019923.39 -15535759.27
1. Other comprehensive income that may be
reclassified to profit and loss under the equity
method -3795486.93 -19208272.66
2. Exchange differences arising from translation
of financial statements denominated in foreign
currencies -12224436.46 3672513.39
Other comprehensive income net of tax attributable to
minority interest – –
76 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
II. Financial Statements (Cont’d)
3. Consolidated Income Statement (Cont’d)
Item First half of 2025 First half of 2024
VII. Total comprehensive income -4200690118.58 10823088.95
To tal comprehensive income attributable to shareholders of
the Company -3873973113.95 13110446.15
Total comprehensive income attributable to minority interest -326717004.63 -2287357.20
VIII. Earnings per share: – –
(i) Basic earnings per share -1.31 0.01
(ii) Diluted earnings per share -1.31 0.01
Legal Representative: Financial controller: Head of the financial department:
Hu Changqing Dong Lianming Zhang Bo
SHANDONG CHENMING PAPER HOLDINGS LIMITED 77
INTERIM REPORT 2025VIII Financial Report
II. Financial Statements (Cont’d)
4. Income statement of the Parent Company
Unit: RMB
Item First half of 2025 First half of 2024
I. Revenue 239501119.75 4405643431.81
Less: Operating costs 263902147.07 4045995379.91
Taxes and surcharges 8073550.14 24633366.92
Sales and distribution expenses 3835197.64 4006101.04
General and administrative expenses 53315461.23 87291113.29
Research and development expense 7832614.00 125852983.90
Finance expenses 216106623.08 122304383.31
Including: Interest expenses 276973038.79 215154909.24
Interest income 81057423.14 151576285.23
Add: Other income 28614313.82 29945854.40
Investment income (“-” denotes loss) 231495721.27 -54484706.48
Including: Investment income from associates and joint
ventures -5404278.73 -36830257.52
Gai ns on derecognition of financial assets measured at
amortised cost (“-” denotes loss) – -10845725.80
Credit impairment loss (“-” denotes loss) -23927394.33 -1228938.13
Loss on impairment of assets (“-” denotes loss) -62106811.37 -673567.00
Gain on disposal of assets (“-” denotes loss) 4766089.03 18393499.78
II. Operating profit (“-” denotes loss) -134722554.99 -12487753.99
Add: Non-operating income 167528.01 1065964.61
Less: Non-operating expenses 19033827.69 594860.21
III. Total profit (“-” denotes total loss) -153588854.67 -12016649.59
Less: Income tax expenses -51186056.65 -24640162.19
IV. Net profit (“-” denotes net loss) -102402798.02 12623512.60
(i) Net profit from continuing operations
(“-” denotes net loss) -102402798.02 12623512.60
(ii) Net profit from discontinued operations
(“-” denotes net loss) – –
V. T otal comprehensive income -102402798.02 12623512.60
78 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
II. Financial Statements (Cont’d)
5. Consolidated cash flow statement
Unit: RMB
Item First half of 2025 First half of 2024
I. Cash flows from operating activities:
Cash received from sales of goods and rendering of services 2454250322.21 14231647331.45
Tax rebates received – 8107525.70
Cash received relating to other operating activities 342606805.59 150658134.92
Subtotal of cash inflows from operating activities 2796857127.80 14390412992.07
Cash paid for goods and services 1310359147.70 10553832290.81
Cash paid to and for employees 432100405.57 657515276.65
Payments of taxes and surcharges 113625874.01 242371386.74
Cash paid relating to other operating activities 155468426.33 944194644.80
Subtotal of cash outflows from operating activities 2011553853.61 12397913599.00
Net cash flows from operating activities 785303274.19 1992499393.07
II. Cash flows from investing activities:
Cash received from investments – 1483295.37
Cash received from investment income – 1298463.59
Net cash received from disposal of fixed assets intangible
assets and other long-term assets 17583570.00 14657469.09
Ne t cash received from disposal of subsidiaries and other
business units 650000.00 610107490.67
Cash received relating to other investing activities – –
Subtotal of cash inflows from investing activities 18233570.00 627546718.72
Ca sh paid for purchase of fixed assets intangible assets and
other long-term assets 2732142.00 56241530.58
Cash paid for investment – –
Ne t cash paid for acquisition of subsidiaries and other
business units 508955916.13 –
Cash paid relating to other investing activities – –
Subtotal of cash outflows from investing activities 511688058.13 56241530.58
Net cash flows from investing activities -493454488.13 571305188.14
SHANDONG CHENMING PAPER HOLDINGS LIMITED 79
INTERIM REPORT 2025VIII Financial Report
II. Financial Statements (Cont’d)
5. Consolidated cash flow statement (Cont’d)
Item First half of 2025 First half of 2024
III. Cash flows from financing activities:
Cash received from investments – –
Cash received from borrowings 12289124127.60 15651271993.47
Cash received relating to other financing activities 4853343140.74 1852785703.00
Subtotal of cash inflows from financing activities 17142467268.34 17504057696.47
Cash repayments of amounts borrowed 16908452033.18 17359068511.55
Ca sh paid for dividend and profit distribution or interest
payment 479202789.04 905617475.65
Including: Div idend and profit paid by subsidiaries to minority
shareholders – –
Cash paid relating to other financing activities 134663869.67 1787061193.13
Subtotal of cash outflows from financing activities 17522318691.89 20051747180.33
Net cash flows from financing activities -379851423.55 -2547689483.86
IV. Effect of foreign exchange rate changes on cash and cash
equivalents -961270.77 22481244.59
V. Net increase in cash and cash equivalents -88963908.26 38596341.94
Add: Ba lance of cash and cash equivalents as at the
beginning of the period 151943246.31 764233742.61
VI. Balance of cash and cash equivalents as at the end of the
period 62979338.05 802830084.55
80 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
II. Financial Statements (Cont’d)
6. Cash flow statement of the Parent Company
Unit: RMB
Item First half of 2025 First half of 2024
I. Cash flows from operating activities:
Cash received from sales of goods and rendering of services 368739278.31 4389348030.24
Tax rebates received – –
Cash received relating to other operating activities 7896986.34 159626585.94
Subtotal of cash inflows from operating activities 376636264.65 4548974616.18
Cash paid for goods and services 157337634.27 3833931092.64
Cash paid to and for employees 113495613.54 152875362.26
Payments of taxes and surcharges 25245395.18 23260283.18
Cash paid relating to other operating activities 17316970.73 185450974.46
Subtotal of cash outflows from operating activities 313395613.72 4195517712.54
Net cash flows from operating activities 63240650.93 353456903.64
II. Cash flows from investing activities:
Cash received from investments – 488776095.37
Cash received from investment income – 110698463.59
Net cash received from disposal of fixed assets intangible
assets and other long-term assets 12091460.00 14521469.09
Ne t cash received from disposal of subsidiaries and other
business units – –
Cash received relating to other investing activities – –
Subtotal of cash inflows from investing activities 12091460.00 613996028.05
Ca sh paid for purchase of fixed assets intangible assets
and other long-term assets – 5342093.92
Cash paid for investment – –
Net cash paid for acquisition of subsidiaries and other
business units – –
Cash paid relating to other investing activities – –
Subtotal of cash outflows from investing activities – 5342093.92
Net cash flows from investing activities 12091460.00 608653934.13
SHANDONG CHENMING PAPER HOLDINGS LIMITED 81
INTERIM REPORT 2025VIII Financial Report
II. Financial Statements (Cont’d)
6. Cash flow statement of the Parent Company (Cont’d)
Item First half of 2025 First half of 2024
III. Cash flows from financing activities:
Cash received from investments – –
Cash received from borrowings 5450190140.83 10107406194.25
Cash received relating to other financing activities 1344321473.63 757331971.66
Subtotal of cash inflows from financing activities 6794511614.46 10864738165.91
Cash repayments of amounts borrowed 6722974722.24 11078908500.08
Ca sh paid for dividend and profit distribution or interest
payment 143049448.89 207045676.09
Cash paid relating to other financing activities 3710625.20 464307395.90
Subtotal of cash outflows from financing activities 6869734796.33 11750261572.07
Net cash flows from financing activities -75223181.87 -885523406.16
IV. Effect of foreign exchange rate changes on cash and cash
equivalents -24936.16 1254926.56
V. Net increase in cash and cash equivalents 83992.90 77842358.17
Add: Ba lance of cash and cash equivalents as at the
beginning of the period 268719.28 350786839.40
VI. Balance of cash and cash equivalents as at the end of the
period 352712.18 428629197.57
82 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
SHANDONG CHENMING PAPER HOLDINGS LIMITED 83
INTERIM REPORT 2025
II. Financial Statements (Cont’d)
7. Consolidated statement of changes in owners’ equity
Amount for the period
Unit: RMB
First half of 2025
Equity attributable to owners of the Parent Company
Other equity instruments Other
Preference Less: comprehensive General risk Total
Item Share capita l share s Perpetual bond s Other s Capital reserve s Treasury share s incom e Special reserve s Surplus reserve s provision s Retained prof it Subtota l Minority interes t owners’ equit y
I. Balance as at the end of the prior year 2934556200.00 – – – 5207678622.75 – -913708670.15 26800491.53 1212009109.97 80950584.11 607818020.70 9156104358.91 3679666266.24 12835770625.15
II. Balance as at the beginning of the year 2934556200.00 – – – 5207678622.75 – -913708670.15 26800491.53 1212009109.97 80950584.11 607818020.70 9156104358.91 3679666266.24 12835770625.15
III. Changes in the period (“-” denotes decrease) – – – – 33600607.04 – -16019923.39 3031364.33 – – -3857953190.56 -3837341142.58 -1303375431.28 -5140716573.86
(i) Total comprehensive income – – – – – – -16019923.39 – – – -3857953190.56 -3873973113.95 -326717004.63 -4200690118.58
(ii) Capital paid in and reduced by shareholders (or owners) – – – – 33600607.04 – – – – – – 33600607.04 -978682819.59 -945082212.55
1. Ordinary shares paid by shareholders – – – – – – – – – – – – -978682819.59 -978682819.59
2. Amount of share-based payments recognised in
shareholders’ equity – – – – – – – – – – – – – –
3. Others – – – – 33600607.04 – – – – – – 33600607.04 – 33600607.04
(iii) Profit distribution – – – – – – – – – – – – – –
(iv) Transfer within shareholders’ equity – – – – – – – – – – – – 2024392.94 2024392.94
(v) Special reserves – – – – – – – 3031364.33 – – – 3031364.33 – 3031364.33
1. Withdrawn in the period – – – – – – – 3633487.86 – – – 3633487.86 – 3633487.86
2. Used in the period (denotes in “-”) – – – – – – – -602123.53 – – – -602123.53 – -602123.53
(vi) Others – – – – – – – – – – – – – –
IV. Balance as at the end of the year 2934556200.00 – – – 5241279229.79 – -929728593.54 29831855.86 1212009109.97 80950584.11 -3250135169.86 5318763216.33 2376290834.96 7695054051.29VIII Financial Report
84 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025
II. Financial Statements (Cont’d)
7. Consolidated statement of changes in owners’ equity (Cont’d)
Amounts for the prior year
Unit: RMB
First half of 2024
Equity attributable to owners of the Parent Company
Other equity instruments Other
Preference Perpetual Capital Less: comprehensive Special Surplus General risk Retained Minority Total
I tem Share capital shares bonds Others reserves Treasury shares income reserves reserves provisions profit Others Subtotal interest owners’ equity
I. Balance as at the end of the prior year 2956813200.00 – – – 5328790899.61 63432450.00 -864881489.08 23322829.57 1212009109.97 79370294.91 8020182801.55 – 16692175196.53 4405680649.10 21097855845.63
II. Balance as at the beginning of the year 2956813200.00 – – – 5328790899.61 63432450.00 -864881489.08 23322829.57 1212009109.97 79370294.91 8020182801.55 – 16692175196.53 4405680649.10 21097855845.63
III. Changes in the period (“-” denotes decrease) – – – – -78482755.95 – -15535759.27 2126139.35 – 13361.84 28632843.58 – -63246170.45 -343374662.90 -406620833.35
(i) Total comprehensive income – – – – – – -15535759.27 – – – 28646205.42 – 13110446.15 -2287357.20 10823088.95
(ii) Capital paid in and reduced by owners – – – – -78482755.95 – – – – – – – -78482755.95 -290042380.45 -368525136.40
1. Ordinary shares paid by owners – – – – – – – – – – – – – -290042380.45 -290042380.45
2. Others – – – – -78482755.95 – – – – – – – -78482755.95 – -78482755.95
(iii) Profit distribution – – – – – – – – – 13361.84 -13361.84 – – -123000000.00 -123000000.00
1. Transfer of general risk reserves – – – – – – – – – 13361.84 -13361.84 – – – –
2. Distribution to owners (or shareholders) – – – – – – – – – – – – – -123000000.00 -123000000.00
(iv) Transfer within owners’ equity – – – – – – – – – – – – – 71955074.75 71955074.75
1. Others – – – – – – – – – – – – – 71955074.75 71955074.75
(v) Special reserves – – – – – – – 2126139.35 – – – – 2126139.35 – 2126139.35
1. Withdrawn in the period – – – – – – – 5053378.02 – – – – 5053378.02 – 5053378.02
2. Used in the period – – – – – – – -2927238.67 – – – – -2927238.67 – -2927238.67
IV. Balance as at the end of the period 2956813200.00 – – – 5250308143.66 63432450.00 -880417248.35 25448968.92 1212009109.97 79383656.75 8048815645.13 – 16628929026.08 4062305986.20 20691235012.28VIII Financial Report
SHANDONG CHENMING PAPER HOLDINGS LIMITED 85
INTERIM REPORT 2025
II. Financial Statements (Cont’d)
8. Statement of changes in owners’ equity of the Parent Company
Amount for the period
Unit: RMB
First half of 2025
Other equity instruments Other
Preference Perpetual Less: comprehensive Special Surplus Retained
Item Share capital shares bonds Others Capital reserves Treasury shares income reserves reserves profit Total owners’ equity
I. Balance as at the end of the prior year 2934556200.00 – – – 5032163419.19 – – 7405266.87 1199819528.06 2471033182.58 11644977596.70
II. Balance as at the beginning of the year 2934556200.00 – – – 5032163419.19 – – 7405266.87 1199819528.06 2471033182.58 11644977596.70
III. Changes in the period (“-” denotes decrease) – – – -26297501.66 – – -102402798.02 -128700299.68
(i) Total comprehensive income – – – – – – – – – -102402798.02 -102402798.02
(ii) Capital paid in and reduced by shareholders (or owners) – – – -26297501.66 – – – – -26297501.66
1. Amount of share-based payments recognised in
shareholders’ equity – – – – – – – –
2. Others -26297501.66 -26297501.66
(iii) Special reserves – – – – – – – – – –
1. Withdrawn in the period – – – – – – – – – –
2. Used in the period (denotes in “-”) – – – – – – – – – – –
IV. Balance as at the end of the year 2934556200.00 – – – 5005865917.53 – 7405266.87 1199819528.06 2368630384.56 11516277297.02VIII Financial Report
86 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025
II. Financial Statements (Cont’d)
8. Statement of changes in owners’ equity of the Parent Company (Cont’d)
Amounts for the prior year
Unit: RMB
First half of 2024
Other equity instruments Other
Preference Perpetual Less: comprehensive Special Surplus Retained Total
Item Share capital shares bonds Others Capital reserves Treasury shares income reserves reserves profit Others owners’ equity
I. Balance as at the end of the prior year 2956813200.00 – – – 5073338869.19 63432450.00 – 4612641.99 1199819528.06 3138783314.72 – 12309935103.96
II. Balance as at the beginning of the year 2956813200.00 – – – 5073338869.19 63432450.00 – 4612641.99 1199819528.06 3138783314.72 – 12309935103.96
III. Changes in the period (“-” denotes decrease) – – – – – – – 1396312.44 – 12623512.60 – 14019825.04
(i) Total comprehensive income – – – – – – – – – 12623512.60 – 12623512.60
(ii) Special reserves – – – – – – – 1396312.44 – – – 1396312.44
1. Withdrawn in the period – – – – – – – 1396312.44 – – – 1396312.44
I V. Balance as at the end of the period 2956813200.00 – – – 5073338869.19 63432450.00 – 6008954.43 1199819528.06 3151406827.32 – 12323954929.00VIII Financial Report
III. General Information of the Company
1. Company overview
The predecessor of Shandong Chenming Paper Holdings Limited (hereinafter referred to as the “Company” a joint-stock
company incorporated in Shouguang City Shandong Province) was Shandong Shouguang Paper Mill Corporation
which was changed as a joint stock company with limited liability through offering to specific investors in May 1993. In
December 1996 with approval by Lu Gai Zi [1996] No. 270 issued by the People’s Government of Shandong Province
and Zheng Wei [1996] No. 59 of the Securities Committee of the State Council the Company was changed as a joint
stock company with limited liability established by share offer. The Company’s headquarters is located at No. 2199
Nongsheng East Road Shouguang City Shandong Province.In May 1997 with approval by Zheng Wei Fa [1997] No. 26 issued by the Securities Committee of the State Council
the Company issued 115000000 domestic listed foreign shares (B shares) under public offering which were listed and
traded on Shenzhen Stock Exchange from 26 May 1997.In September 2000 with approval by Zheng Jian Gong Si Zi [2000] No. 151 issued by the China Securities Regulatory
Commission the Company issued additional 70000000 RMB ordinary shares (A shares) which were listed and traded
on Shenzhen Stock Exchange from 20 November 2000.In June 2008 with approval by the Stock Exchange of Hong Kong Limited the Company issued 355700000 H shares.At the same time 35570000 H shares were allocated to the National Council for Social Security Fund by our relevant
state-owned shareholder and converted into overseas listed foreign shares (H shares) for the purpose of reducing the
number of state-owned shares. The additionally issued H shares were listed and traded on Hong Kong Stock Exchange
on 18 June 2008.As at 30 June 2025 the total share capital of the Company was 2934556200 shares. For details please refer to Note
VII. 40.Principal business activities: the Company is principally engaged in among other things processing and sale of paper
products (including machine-made paper and paper board) paper making raw materials machinery and chemicals;
generation and sale of electric power and thermal power; forestry saplings growing processing and sale of timber
and construction materials; manufacturing processing and sale of wood products; and hotel service and equipment
financial and operating leasing investment properties and property service etc.The financial statements and notes thereto were approved at the fourteenth meeting of the tenth session of the board of
directors of the Company (the “Board”) on 29 August 2025.
2. Scope of consolidation
Subsidiaries of the Company included in the scope of consolidation in 2025 totalled 77. For details please refer to Note
X “Interest in other entities”. The scope of consolidation of the Company during the year had two more companiesincluded and one company less compared to the prior year. For details please refer to Note IX “Change in scope ofconsolidation”.SHANDONG CHENMING PAPER HOLDINGS LIMITED 87
INTERIM REPORT 2025VIII Financial Report
IV. Basis of Preparation of the Financial Statements
1. Basis of preparation
These financial statements are prepared in accordance with the accounting standards for business enterprises the
application guidelines thereof interpretations and other related rules (collectively referred to as “ASBEs”) promulgated
by the Ministry of Finance. In addition the Company also discloses relevant financial information in accordance withthe “Preparation Rules for Information Disclosure by Companies Offering Securities to the Public No. 15 – GeneralProvisions on Financial Reports” (revised in 2023) of the CSRC.The financial statements are presented on a going concern.
2. Going concern
No facts or circumstances comprise a material uncertainty about the Company’s going concern basis within 12 months
since the end of the reporting period.V. Significant Accounting Policies and Accounting Estimates
Specific accounting policies and accounting estimates are indicated as follows:
The Company and its subsidiaries are engaged in the business of machine-made paper electricity and heat building
materials paper chemicals hotel management etc. The Company and its subsidiaries have formulated a number of specific
accounting policies and accounting estimates for transactions and matters such as revenue recognition determination of
performance progress and R&D expenses based on their actual production and operation characteristics in accordance
with the requirements of the relevant ASBEs. For details please refer to the descriptions under Note V.30 “Revenue”. For anexplanation of the critical accounting judgments and estimates made by the management please refer to Note 39 “Criticalaccounting judgments and estimates”.
1. Statement of compliance with the Accounting Standards for Business Enterprises
These financial statements have been prepared in conformity with the ASBEs which truly and fully reflect the financial
position of the consolidated entity and the Company as at 30 June 2025 and relevant information such as the operating
results and cash flows of the consolidated entity and the Company for the first half of 2025.
2. Accounting period
The accounting period of the Company is from 1 January to 31 December of each calendar year.
3. Operating cycle
The operating cycle of the Company lasts for 12 months.
88 SHANDONG CHENMING PAPER HOLDINGS LIMITED
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V. Significant Accounting Policies and Accounting Estimates (Cont’d)
4. Functional currency
The functional currency of the Company and its domestic subsidiaries is Renminbi (“RMB”). Overseas subsidiaries of the
Company recognise U.S. dollar (“USD” or “US$”) Japanese yen (“JPY”) Euro (“EUR”) and South Korean Won (“KRW”)
as their respective functional currency according to the general economic environment in which these subsidiaries
operate. The Company prepares the financial statements in RMB.
5. Determination method and selection basis of importance standards
Item Importance standards
Significant accounts receivable with single provision for bad Overdue accounts receivable and the amount of a single
debt provisions receivable exceeds 0.5% of total assets
Write-off of significant accounts receivable during the The amount of a single write-off exceeds 0.5% of net
period assets
Significant prepayments aged more than one year Aged more than one year and the single amount exceeds
0.5% of total assets
Significant receipts in advance aged more than one year Aged more than one year and the single amount exceeds
0.5% of total assets
Significant other payables aged more than one year Aged more than one year and the single amount exceeds
0.5% of total assets
Significant accounts payable aged more than one year Aged more than one year and the single amount exceeds
0.5% of total assets
Bad debt provisions with significant amounts reversed or Individually identified or classified into the third stage the
recovered during the current period amount transferred or recovered exceeds 0.5% of total
assets
Significant construction in progress Projects with budgets exceeding 0.5% of total assets
Significant non-wholly owned subsidiaries The total assets of the subsidiary exceed 10% of the
Company on a consolidated basis and the revenue or
pre-tax profit exceeds 10%
Significant investing activities Investment amount exceeds 0.5% of total assets
Significant joint ventures and associates The joint venture or associate operates normally with an
accounting amount exceeding 0.5% of total assets
Significant debt restructuring The restructuring amount exceeds 0.5% of total assets
SHANDONG CHENMING PAPER HOLDINGS LIMITED 89
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
6. Accounting treatment of business combinations under common control and not under common control
(1) Business combination under common control
For the business combination involving entities under common control the assets and liabilities of the party being
merged that are obtained in the business combination by the absorbing party shall be measured at the carrying
amounts as recorded by the ultimate controlling party in the consolidated financial statements at the combination
date. The difference between the carrying amount of the consideration paid for the combination and the carrying
amount of the net assets obtained in the combination is charged to the capital reserve. If the capital reserve is not
sufficient to absorb the difference any excess shall be adjusted against retained earnings.Business combinations involving entities under common control and achieved in stages
The assets and liabilities of the party being merged that are obtained at the combination by the absorbing party
shall be measured at the carrying value as recorded by the ultimate controlling party in the consolidated financial
statements at combination date. The difference between the sum of the carrying value from original shareholding
portion and the new investment cost incurred at combination date and the carrying value of net assets obtained
at combination date shall be adjusted to capital reserve (share premium/capital premium) if the balance of capital
reserve is not sufficient to absorb the differences any excess is adjusted to retained earnings. The long-term
investment prior to the absorbing party obtaining the control of the party being merged the recognised profit or
loss comprehensive income and other change of owners’ equity at the closer date of the acquisition date and
combination date under common control shall separately offset the opening balance of retained earnings and
profit or loss during comparative statements.
(2) Business combination not under common control
For business combinations involving entities not under common control the cost for each combination is
measured at the aggregate fair value at acquisition date of assets given liabilities incurred or assumed and
equity securities issued by the acquirer in exchange for control of the acquiree. At acquisition date the acquired
assets liabilities or contingent liabilities of acquiree are measured at their fair value.
90 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
6. Accounting treatment of business combinations under common control and not under common control
(Cont’d)
(2) Business combination not under common control (Cont’d)
Where the cost of combination exceeds the acquirer’s interest in the fair value of the acquiree’s identifiable net
assets the difference is recognised as goodwill and subsequently measured on the basis of its cost minus
accumulative impairment provision; Where the cost of combination is less than the acquirer’s interest in the fair
value of the acquiree’s identifiable net assets the difference is recognised in profit or loss for the current period
after reassessment.Business combinations involving entities not under common control and achieved in stages
The combination cost is the sum of consideration paid at acquisition date and fair value of the acquiree’s equity
investment held prior to acquisition date. The cost of equity of the acquiree held prior to acquisition date shall be
remeasured at the fair value at acquisition date and the difference between the fair value and carrying amount
shall be recognised as investment income or loss for the current period. Other comprehensive income and
changes of other owners’ equity related with acquiree’s equity held prior to acquisition date shall be transferred
to investment profit or loss for current period at acquisition date except for the other comprehensive income
incurred by the changes of net assets or net liabilities due to the remeasurement of defined benefit plans and
the other comprehensive income related to investments in non-trading equity instruments that were previously
designated as at fair value through other comprehensive income.
(3) Transaction fees attribution during business combination
The audit legal valuation advisory and other intermediary fees and other relevant administrative expenses arising
from business combinations are recognised in profit or loss when incurred. Transaction costs of equity or debt
securities issued as the considerations of business combination are included in the initial recognition amounts.
7. Judgment criteria for control and preparation of consolidated financial statements
(1) Judgment criteria for control
The scope of consolidation of the consolidated financial statements is determined on the basis of control. The
term “control” refers to the fact that the Company has power over the investee and is entitled to variable returns
from its involvement with the investee and the ability to use its power over the investee to affect the amount of
those returns. The Company will reassess when changes in relevant facts and circumstances result in changes in
the relevant elements involved in the definition of control.When judging whether to include a structured entity into the scope of consolidation the Company
comprehensively considers all facts and circumstances including assessing the purpose and design of the
structured entity identifying the types of variable returns and assessing whether to control the structured entity
on the basis of whether it bears part or all of the return variability by participating in its related activities.SHANDONG CHENMING PAPER HOLDINGS LIMITED 91
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
7. Judgment criteria for control and preparation of consolidated financial statements (Cont’d)
(2) Basis for preparation of the consolidated financial statements
The consolidated financial statements are prepared by the Company based on the financial statements of the
Company and its subsidiaries and other relevant information. In preparing the consolidated financial statements
the accounting policies and accounting periods of the Company and its subsidiaries shall be consistent and intra-
company significant transactions and balances are eliminated.A subsidiary and its business acquired through a business combination involving entities under common control
during the reporting period shall be included in the scope of the consolidation of the Company from the date
of being controlled by the ultimate controlling party and its operating results and cash flows from the date of
being controlled by the ultimate controlling party are included in the consolidated income statement and the
consolidated cash flow statement respectively.For a subsidiary and its business acquired through a business combination involving entities not under common
control during the reporting period its income expenses and profits are included in the consolidated income
statement and cash flows are included in the consolidated cash flow statement from the acquisition date to the
end of the reporting period.The shareholders’ equity of the subsidiaries that is not attributable to the Company is presented under
shareholders’ equity in the consolidated balance sheet as minority interest. The portion of net profit or loss of
subsidiaries for the period attributable to minority interest is presented in the consolidated income statement
under the “profit or loss of minority interest”. When the amount of loss attributable to the minority shareholders of
a subsidiary exceeds the minority shareholders’ portion of the opening balance of owners’ equity of the subsidiary
the excess amount shall be allocated against minority interest.
(3) Acquisition of non-controlling interests in subsidiaries
The difference between the long-term equity investments costs acquired by the acquisition of non-controlling
interests and the share of the net assets from subsidiaries from the date of acquisition or the date of combination
based on the new shareholding ratio as well as the difference between the proceeds from the partial disposal
of the equity investment without losing control over its subsidiary and the disposal of the long-term equity
investment corresponding to the share of the net assets of the subsidiaries from the date of acquisition or the date
of combination is adjusted to the capital reserve. If the capital reserve is not sufficient any excess is adjusted to
retained earnings.
(4) Accounting treatment for loss of control over subsidiaries
For the loss of control over a subsidiary due to disposal of a portion of the equity investment or other reasons
the remaining equity is measured at fair value on the date when the control is lost. The difference arising from
the sum of consideration received for disposal of equity interest and the fair value of remaining equity interest
over the sum of the share of the carrying amount of net assets of the former subsidiary calculated continuously
from the purchase date based on the shareholding percentage before disposal and the goodwill is recognised as
investment income in the period when the control is lost.Other comprehensive income related to equity investment in the former subsidiary shall be accounted for on the
same basis as the former subsidiary’s direct disposal of relevant assets or liabilities when the control is lost. Other
changes in owners’ equity related to the former subsidiary that are accounted for using the equity method shall be
transferred to current profit or loss at the time when the control is lost.
92 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
8. Classification of joint arrangements and accounting treatment for joint operations
A joint arrangement refers to an arrangement of two or more parties have joint control. The joint arrangements of the
Company comprise joint operations and joint ventures.
(1) Joint operations
Joint operations refer to a joint arrangement during which the Company is entitled to relevant assets and
obligations of this arrangement.The Company recognises the following items in relation to its interest in a joint operation and accounts for them in
accordance with the relevant ASBEs:
A. the assets held solely by it and assets held jointly according to its share;
B. the liabilities assumed solely by it and liabilities assumed jointly according to its share;
C. the revenue from sale of output from joint operations;
D. the revenue from sale of output from joint operations according to its share;
E. the fees solely incurred by it and fees incurred from joint operations according to its share.
(2) Joint ventures
Joint ventures refer to a joint arrangement during which the Company only is entitled to net assets of this
arrangement.The Company accounts for its investments in joint ventures in accordance with the requirements relating to
accounting treatment using equity method for long-term equity investments.
9. Standards for recognising cash and cash equivalents
Cash refers to cash on hand and deposits readily available for payment purpose. Cash equivalents refer to short-term
and highly liquid investments held by the Company which are readily convertible into known amount of cash and which
are subject to insignificant risk of value change.SHANDONG CHENMING PAPER HOLDINGS LIMITED 93
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
10. Foreign currency operations and translation of statements denominated in foreign currency
(1) Foreign currency operations
The foreign currency operations of the Company are translated into the functional currency at the prevailing spot
exchange rate on the date of exchange.On the balance sheet date foreign currency monetary items shall be translated at the spot exchange rate on
the balance sheet date. The exchange difference arising from the difference between the spot exchange rate
on the balance sheet date and the spot exchange rate upon initial recognition or the last balance sheet date will
be recognised in profit or loss for the period. The foreign currency non-monetary items measured at historical
cost shall still be measured by the functional currency translated at the spot exchange rate on the date of the
transaction. Foreign currency non-monetary items measured at fair value are translated at the spot exchange
rate on the date of determination of the fair value. The difference between the amounts of the functional currency
before and after the translation will be recognised in profit or loss or other comprehensive income for the period
based on the nature of the non-monetary items.
(2) Translation of financial statements denominated in foreign currency
When translating the financial statements denominated in foreign currency of overseas subsidiaries assets and
liabilities on the balance sheet are translated at the spot exchange rate prevailing at the balance sheet date;
owner’s equity items except for “retained profit” are translated at the spot exchange rates at the dates on which
such items arose.Income and expenses items in the income statement are translated at the prevailing spot exchange rate on the
transaction date.All items in the cash flow statements shall be translated at the prevailing spot exchange rate on the date that
the cash flow transaction occurred. Effects arising from changes of exchange rate on cash shall be presented
separately as the “effect of foreign exchange rate changes on cash and cash equivalents” item in the cash flow
statements.The differences arising from translation of financial statements shall be included in the “other comprehensiveincome” item in owners’ equity in the balance sheet.On disposal of foreign operations and loss of control exchange differences arising from the translation of financial
statements denominated in foreign currencies related to the disposed foreign operations which has been included
in shareholders’ equity in the balance sheet shall be transferred to profit or loss in whole or in proportionate share
in the period in which the disposal took place.
94 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
11. Financial instruments
A financial instrument is a contract that gives rise to a financial asset of one party and a financial liability or equity
instrument of another party.
(1) Recognition and derecognition of financial instruments
Financial asset or financial liability will be recognised when the Company became one of the parties under a
financial instrument contract.Financial asset that satisfied any of the following criteria shall be derecognised:
* the contract right to receive the cash flows of the financial asset has terminated;
* the financial asset has been transferred and meets the derecognition criteria for the transfer of financial
asset as described below.A financial liability (or a part thereof) is derecognised only when the present obligation is discharged in full or in
part. If an agreement is entered between the Company (debtor) and a creditor to replace the existing financial
liabilities with new financial liabilities and the contractual terms of the new financial liabilities are substantially
different from those of the existing financial liabilities the existing financial liabilities shall be derecognised and the
new financial liabilities shall be recognised.Conventionally traded financial assets shall be recognised and derecognised at the trading date.
(2) Classification and measurement of financial assets
The Company classifies the financial assets according to the business model for managing the financial assets
and characteristics of the contractual cash flows as follows: financial assets measured at amortised cost financial
assets measured at fair value through other comprehensive income and financial assets measured at fair value
through profit or loss.Financial assets are measured at fair value upon initial recognition. For financial assets measured at fair value
through profit or loss relevant transaction costs are directly recognised in profit or loss for the current period.For other categories of financial assets relevant transaction costs are included in the amount initially recognised.Accounts receivable arising from sales of goods or rendering services without significant financing component
are initially recognised based on the transaction price expected to be entitled by the Company.Financial assets measured at amortised cost
A financial asset is measured at amortised cost if it meets both of the following conditions and is not designated
at fair value through profit or loss:
* The Company’s business model for managing such financial assets is to collect contractual cash flows;
* The contractual terms of the financial asset stipulate that cash flows generated on specific dates are solely
payments of principal and interest on the principal amount outstanding.Subsequent to initial recognition such financial assets are measured at amortised cost using the effective interest
method. A gain or loss on a financial asset that is measured at amortised cost and is not part of a hedging
relationship shall be recognised in profit or loss for the current period when the financial asset is derecognised
amortised using the effective interest method or with impairment recognised.SHANDONG CHENMING PAPER HOLDINGS LIMITED 95
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
11. Financial instruments (Cont’d)
(2) Classification and measurement of financial assets (Cont’d)
Financial assets measured at fair value through other comprehensive income
A financial asset is classified as measured at fair value through other comprehensive income if it meets both of the
following conditions and is not designated at fair value through profit or loss:
* The Company’s business model for managing such financial assets is achieved both by collecting collect
contractual cash flows and selling such financial assets;
* The contractual terms of the financial asset stipulate that cash flows generated on specific dates are solely
payments of principal and interest on the principal amount outstanding.Subsequent to initial recognition such financial assets are subsequently measured at fair value. Interest calculated
using the effective interest method impairment losses or gains and foreign exchange gains and losses are
recognised in profit or loss for the current period and other gains or losses are recognised in other comprehensive
income. On derecognition the cumulative gain or loss previously recognised in other comprehensive income is
reclassified from other comprehensive income to profit or loss.Financial assets measured at fair value through profit or loss
The Company classifies the financial assets other than those measured at amortised cost and measured at fair
value through other comprehensive income as financial assets measured at fair value through profit or loss. Upon
initial recognition the Company irrevocably designates certain financial assets that are required to be measured
at amortised cost or at fair value through other comprehensive income as financial assets measured at fair value
through profit or loss in order to eliminate or significantly reduce accounting mismatch.Upon initial recognition such financial assets are measured at fair value. Except for those held for hedging
purposes gains or losses (including interests and dividend income) arising from such financial assets are
recognised in the profit or loss for the current period.The business model for managing financial assets refers to how the Company manages its financial assets in
order to generate cash flows. That is the Company’s business model determines whether cash flows will result
from collecting contractual cash flows selling financial assets or both. The Company determines the business
model for managing financial assets on the basis of objective facts and specific business objectives for managing
financial assets determined by key management personnel.The Company assesses the characteristics of the contractual cash flows of financial assets to determine whether
the contractual cash flows generated by the relevant financial assets on a specific date are solely payments of
principal and interest on the principal amount outstanding. The principal refers to the fair value of the financial
assets at the initial recognition. Interest includes consideration for the time value of money for the credit risk
associated with the principal amount outstanding during a particular period of time and for other basic lending
risks costs and profits. In addition the Company evaluates the contractual terms that may result in a change in
the time distribution or amount of contractual cash flows from a financial asset to determine whether it meets the
requirements of the above contractual cash flow characteristics.
96 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
11. Financial instruments (Cont’d)
(2) Classification and measurement of financial assets (Cont’d)
Financial assets measured at fair value through profit or loss (Cont’d)
All affected financial assets are reclassified on the first day of the first reporting period following the change in
the business model where the Company changes its business model for managing financial assets; otherwise
financial assets shall not be reclassified after initial recognition.
(3) Classification and measurement of financial liabilities
At initial recognition financial liabilities of the Company are classified as financial liabilities measured at fair value
through profit or loss and financial liabilities measured at amortised cost. For financial liabilities not classified
as measured at fair value through profit or loss relevant transaction costs are included in the amount initially
recognised.Financial liabilities measured at fair value through profit or loss
Financial liabilities measured at fair value through profit or loss comprise held-for-trading financial liabilities and
financial liabilities designated at fair value through profit or loss upon initial recognition. Such financial liabilities
are subsequently measured at fair value and the gains or losses from the change in fair value and the dividend or
interest expenses related to the financial liabilities are included in the profit or loss of the current period.Financial liabilities measured at amortised cost
Other financial liabilities are subsequently measured at amortised cost using the effective interest rate method
and the gains or losses arising from derecognition or amortisation are recognised in profit or loss for the current
period.Classification between financial liabilities and equity instruments
A financial liability is a liability if:
* it has a contractual obligation to pay in cash or other financial assets to other parties.* it has a contractual obligation to exchange financial assets or financial liabilities under potential adverse
condition with other parties.* it is a non-derivative instrument contract which will or may be settled with the entity’s own equity
instruments and the entity will deliver a variable number of its own equity instruments according to such
contract.* it is a derivative instrument contract which will or may be settled with the entity’s own equity instruments
except for a derivative instrument contract that exchanges a fixed amount of cash or other financial asset
with a fixed number of its own equity instruments.SHANDONG CHENMING PAPER HOLDINGS LIMITED 97
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
11. Financial instruments (Cont’d)
(3) Classification and measurement of financial liabilities (Cont’d)
Classification between financial liabilities and equity instruments (Cont’d)
Equity instruments are any contract that evidences a residual interest in the assets of an entity after deducting all
of its liabilities.If the Company cannot unconditionally avoid the performance of a contractual obligation by paying cash or
delivering other financial assets the contractual obligation meets the definition of financial liabilities.Where a financial instrument must or may be settled with the Company’s own equity instruments the Company’s
own equity instruments used to settle such instrument should be considered as to whether it is as a substitute
for cash or other financial assets or for the purpose of enabling the holder of the instrument to be entitled to the
remaining interest in the assets of the issuer after deducting all of its liabilities. For the former it is a financial
liability of the Company; for the latter it is the Company’s own equity instruments.
(4) Fair value of financial instruments
The methods for determining the fair value of the financial assets or financial liabilities are set out in Note V. 12.
(5) Impairment of financial assets
The Company makes provision for impairment based on expected credit losses (ECLs) on the following items:
* Financial assets measured at amortised cost;
* Receivables and investment in debt instruments measured at fair value through other comprehensive
income;
* Contract assets as defined in the Accounting Standards for Business Enterprises No. 14 – Revenue;
* Lease receivables;
* Financial guarantee contracts (except those measured at fair value through profit or loss or formed by
continuing involvement of transferred financial assets or the transfer does not qualify for derecognition).
98 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
11. Financial instruments (Cont’d)
(5) Impairment of financial assets (Cont’d)
Measurement of ECLs
ECLs are the weighted average of credit losses of financial instruments weighted by the risk of default. Credit
losses refer to the difference between all contractual cash flows receivable according to the contract and
discounted according to the original effective interest rate and all cash flows expected to be received i.e. the
present value of all cash shortages.The Company takes into account reasonable and well-founded information such as past events current conditions
and forecasts of future economic conditions and calculates the probability-weighted amount of the present value
of the difference between the cash flows receivable from the contract and the cash flows expected to be received
weighted by the risk of default.The Company measures ECLs of financial instruments at different stages. If the credit risk of the financial
instrument did not increase significantly upon initial recognition it is at the first stage and the Company makes
provision for impairment based on the ECLs within the next 12 months; if the credit risk of a financial instrument
increased significantly upon initial recognition but has not yet incurred credit impairment it is at the second stage
and the Company makes provision for impairment based on the lifetime ECLs of the instrument; if the financial
instrument incurred credit impairment upon initial recognition it is at the third stage and the Company makes
provision for impairment based on the lifetime ECLs of the instrument.For financial instruments with low credit risk on the balance sheet date the Company assumes that the credit
risk did not increase significantly upon initial recognition and makes provision for impairment based on the ECLs
within the next 12 months.Lifetime ECLs represent the ECLs resulting from all possible default events over the expected life of a financial
instrument. The 12-month ECLs are the ECLs resulting from possible default events on a financial instrument
within 12 months (or a shorter period if the expected life of the financial instrument is less than 12 months) after
the balance sheet date and is a portion of lifetime ECLs.The maximum period to be considered when estimating ECLs is the maximum contractual period over which the
Company is exposed to credit risk including renewal options.For the financial instruments at the first and second stages and with low credit risks the Company calculates
the interest income based on the book balance and the effective interest rate before deducting the impairment
provisions. For financial instruments at the third stage interest income is calculated based on the amortised cost
after deducting impairment provisions made from the book balance and the effective interest rate.For receivables such as bills receivable accounts receivable accounts receivable financing and other receivables
if the credit risk characteristics of a customer are significantly different from other customers in the portfolio or the
credit risk characteristics of such customer change significantly the Company will make a separate provision for
bad debts for such receivables. In addition to the receivables for which bad debt provisions are made individually
the Company divides the receivables into portfolios based on credit risk characteristics and calculates bad debt
provisions on a combined basis.SHANDONG CHENMING PAPER HOLDINGS LIMITED 99
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
11. Financial instruments (Cont’d)
(5) Impairment of financial assets (Cont’d)
Bills receivable and accounts receivable
For bills receivable accounts receivable and contract assets regardless of whether there is a significant financing
component the Company always makes provision for impairment at an amount equal to lifetime ECLs.When the Company is unable to assess the information of ECLs for an individual financial asset or contract assets
at a reasonable cost it classifies bills receivable accounts receivable and contract assets into portfolios based on
the credit risk characteristics and calculates the ECLs on a portfolio basis. The basis for determining the portfolios
is as follows:
A. Bills receivable
* Bills receivable portfolio 1: Bank acceptance bills
* Bills receivable portfolio 2: Commercial acceptance bills
B. Accounts receivable
* Accounts receivable portfolio 1: Due from related party customers
* Accounts receivable portfolio 2: Due from non-related party customers
* Accounts receivable portfolio 3: Factoring receivables
For bills receivable classified as a portfolio the Company refers to the historical credit loss experience combined
with the current situation and the forecast of future economic conditions to calculate the ECLs based on default
risk exposure and lifetime ECL rate.For accounts receivable classified as a portfolio the Company refers to the historical credit loss experience
combined with the current situation and the forecast of future economic conditions to prepare a comparison
table of the ageing of accounts receivable and the lifetime ECL rate to calculate the ECLs. The aging of accounts
receivable is calculated from the date of recognition.Other receivables
The Company classifies other receivables into portfolios based on credit risk characteristics and calculates the
ECLs on a portfolio basis. The basis for determining the portfolios is as follows:
* Other receivables portfolio 1: Amount due from government authorities
* Other receivables portfolio 2: Amount due from related parties
* Other receivables portfolio 3: Other receivables
For other receivables classified as a portfolio the Company calculates the ECLs based on default risk exposure
and the ECL rate over the next 12 months or the entire lifetime. For other receivables grouped by aging the aging
is calculated from the date of recognition.
100 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
11. Financial instruments (Cont’d)
(5) Impairment of financial assets (Cont’d)
Long-term receivables
The Company’s long-term receivables include finance lease receivables and deposits receivable.The Company classifies the finance lease receivables and deposits receivable into portfolios based on the credit
risk characteristics and calculates the ECLs on a portfolio basis. The basis for determining the portfolios is as
follows:
A. Finance lease receivables
* Finance lease receivables portfolio 1: Receivables not past due
* Finance lease receivables portfolio 2: Overdue receivables
B. Other long-term receivables
* Other long-term receivables portfolio 1: Deposits receivable
* Other long-term receivables portfolio 2: Other receivables
For accounts receivable financing and deposits receivable the Company refers to the historical credit loss
experience combined with the current situation and the forecast of future economic conditions and calculates
the ECLs based on default risk exposure and lifetime ECL rate.Except for those of finance lease receivables and deposits receivable the ECLs of other receivables and long-
term receivables classified as a portfolio are measured based on default risk exposure and ECL rate over the next
12 months or the entire lifetime.
Debt investments and other debt investments
For debt investments and other debt investments the Company measures the ECLs based on the nature of the
investment the types of counterparty and risk exposure and default risk exposure and ECL rate within the next
12 months or the entire lifetime.
SHANDONG CHENMING PAPER HOLDINGS LIMITED 101
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
11. Financial instruments (Cont’d)
(5) Impairment of financial assets (Cont’d)
Assessment of significant increase in credit risk
In assessing whether the credit risk of a financial instrument has increased significantly upon initial recognition the
Company compares the risk of default of the financial instrument at the balance sheet date with that at the date
of initial recognition to determine the relative change in risk of default within the expected lifetime of the financial
instrument.In determining whether the credit risk has increased significantly upon initial recognition the Company considers
reasonable and well-founded information including forward-looking information which can be obtained without
unnecessary extra costs or efforts. Information considered by the Company includes:
* The debtor’s failure to make payments of principal and interest on their contractually due dates;
* An actual or expected significant deterioration in a financial instrument’s external or internal credit rating (if
any);
* An actual or expected significant deterioration in the operating results of the debtor;
* Existing or expected changes in the technological market economic or legal environment that have a
significant adverse effect on the debtor’s ability to meet its obligation to the Company.Depending on the nature of the financial instruments the Company assesses whether there has been a significant
increase in credit risk on either an individual basis or a collective basis. When the assessment is performed on a
collective basis the financial instruments are grouped based on their common credit risk characteristics such as
past due information and credit risk ratings.The Company determines that the credit risk on a financial asset has increased significantly if it is more than 30
days past due.Credit-impaired financial assets
At balance sheet date the Company assesses whether financial assets measured at amortised cost and debt
investments measured at fair value through other comprehensive income are credit-impaired. A financial asset is
credit-impaired when one or more events that have an adverse effect on the estimated future cash flows of the
financial asset have occurred. Evidence that a financial asset is credit-impaired includes 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;
* For economic or contractual reasons relating to the debtor’s financial difficulty the Company having granted
to the debtor a concession that would not otherwise consider;
* It becoming probable that the debtor will enter bankruptcy or other financial reorganisation;
* The disappearance of an active market for that financial asset because of financial difficulties of the issuer
or debtor.
102 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
11. Financial instruments (Cont’d)
(5) Impairment of financial assets (Cont’d)
Presentation of provisions for ECLs
ECLs are remeasured at each balance sheet date to reflect changes in the financial instrument’s credit risk upon
initial recognition. Any change in the ECL amount is recognised as an impairment gain or loss in profit or loss for
the current period. For financial assets measured at amortised cost the provisions of impairment is deducted
from the carrying amount of the financial assets presented in the balance sheet; for debt investments at fair value
through other comprehensive income the Company makes provisions of impairment in other comprehensive
income without reducing the carrying amount of the financial asset.Write-offs
The book balance of a financial asset is directly written off to the extent that there is no realistic prospect of
recovery of the contractual cash flows of the financial asset (either partially or in full). Such write-off constitutes
derecognition of such financial asset. This is generally the case when the Company determines that the debtor
does not have assets or sources of income that could generate sufficient cash flows to repay the amounts subject
to the write-off. However financial assets that are written off could still be subject to enforcement activities in
order to comply with the Company’s procedures for recovery of amounts due.If a write-off of financial assets is subsequently recovered the recovery is credited to profit or loss in the period in
which the recovery occurs.
(6) Transfer of financial assets
Transfer of financial assets refers to the transfer or delivery of financial assets to another party other than the
issuer of such financial assets (the transferee).If the Company transfers substantially all the risks and rewards of ownership of the financial asset to the
transferee the financial asset shall be derecognised. If the Company retains substantially all the risks and rewards
of ownership of a financial asset the financial asset shall not be derecognised.If the Company neither transfers nor retains substantially all the risks and rewards of ownership of the financial
asset it accounts for the transaction as follows: if the Company does not retain control it derecognises the
financial asset and recognises any resulting assets or liabilities; if the control over the financial asset is not waived
the relevant financial asset is recognised according to the extent of its continuing involvement in the transferred
financial asset and the relevant liability is recognised accordingly.
(7) Offset of financial assets and financial liabilities
If the Company owns the legitimate rights of offsetting the recognised financial assets and financial liabilities
which are enforceable currently and the Company plans to realise the financial assets or to clear off the financial
liabilities on a net amount basis or simultaneously the net amount of financial assets and financial liabilities shall
be presented in the balance sheet upon offsetting. Otherwise financial assets and financial liabilities are presented
separately in the balance sheet without offsetting.SHANDONG CHENMING PAPER HOLDINGS LIMITED 103
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
12. Fair value measurement
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.The Company measures the relevant asset and liability at fair value based on the presumption that the orderly
transaction to sell the asset or transfer the liability takes place either in the principal market for the relevant asset or
liability or in the absence of a principal market in the most advantageous market for relevant the asset or liability. The
principal or the most advantageous market must be a trading market accessible by the Company at the measurement
date. The Company adopts the presumption that market participants would use when pricing the asset or liability in their
best economic interest.If there exists an active market for a financial asset or financial liability the Company uses the quotation on the active
market as its fair value. If the market for a financial instrument is inactive the Company uses valuation technique to
recognise its fair value.Fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic
benefits by using the asset in its best use or by selling it to another market participant that would use the asset in its
best use.The Company adopts valuation techniques that are appropriate in the current circumstance and for which sufficient data
and other information are available prioritises the use of relevant observable inputs and uses unobservable inputs only
under the circumstances where such relevant observable inputs cannot be obtained or practicably obtained.Assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the
fair value hierarchy based on the lowest level input that is significant to the fair value measurement as a whole. Level 1:
based on quoted prices (unadjusted) in active markets for identical assets or liabilities obtainable at the measurement
date. Level 2: observable inputs for the relevant asset or liability either directly or indirectly except for Level 1 input.Level 3: unobservable inputs for the relevant assets or liability.At each balance sheet date the Company reassesses assets and liabilities measured at fair value that are recognised
in the financial statements on a recurring basis to determine whether transfers have occurred between fair value
measurement hierarchy levels.
13. Inventories
(1) Classification of inventories
Inventories of the Company mainly include raw materials work in progress goods in stock development products
and consumable biological assets etc.
(2) Pricing of inventories dispatched
Inventories of the Company are measured at their actual cost when obtained. Cost of raw materials goods in
stock and others will be calculated with weighted average method when being dispatched.Consumable biological assets refer to biological assets held-for-sale which include growing timber. Consumable
biological assets without a stock are stated at historical cost at initial recognition and subsequently measured
at fair value when there is a stock. Changes in fair values shall be recognised as profit or loss in the current
period. The cost of self-planting self-cultivating consumable biological assets is the necessary expenses
directly attributable to such assets prior to canopy closure including borrowing costs eligible for capitalisation.Subsequent expenses such as maintenance cost incurred after canopy closure shall be included in profit or loss
for the current period.The cost of consumable biological assets shall at the time of harvest or disposal be carried forward at carrying
amount using the stock volume proportion method.
104 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
13. Inventories (Cont’d)
(3) Recognition of and provision for inventory impairment
At the balance sheet date inventories are measured at the lower of cost and net realisable value. If the net
realisable value is below the cost of inventories a provision for inventory impairment is made.Net realisable value refers to the amount of the estimated price of inventories less the estimated cost incurred
upon completion estimated sales expenses and taxes and levies. The realisable value of inventories shall be
determined on the basis of definite evidence purpose of holding the inventories and effect of after-balance-sheet-
date events.The Company usually makes provisions for inventory impairment on the basis of individual inventory items;
however for inventories with large quantities and lower unit prices these inventories are accrued impairment
according to inventory categories.
(4) Inventory stock taking system
The Company implements permanent inventory system as its inventory stock taking system.
(5) Amortisation of low-value consumables and packaging materials
The low-value consumables of the Company are amortised when issued for use.Packaging materials for turnover are amortised when issued for use.
14. Long-term equity investments
Long-term equity investments include the equity investments in subsidiaries joint ventures and associates. Associates
of the Company are those investees that the Company imposes significant influence over.
(1) Determination of initial investment cost
Long-term equity investments acquired through business combinations: for a long-term equity investment
acquired through a business combination involving enterprises under common control the investment cost shall
be the absorbing party’s share of the carrying amount of the owners’ equity under the consolidated financial
statements of the ultimate controlling party on the date of combination. For a long-term equity investment
acquired through a business combination involving enterprises not under common control the investment cost of
the long-term equity investment shall be the cost of combination.Long-term equity investments acquired through other means: for a long-term equity investment acquired by cash
payment the initial investment cost shall be the purchase cost actually paid; for a long-term equity investment
acquired by issuing equity securities the initial investment cost shall be the fair value of equity securities issued.
(2) Subsequent measurement and method for profit or loss recognition
Investments in subsidiaries shall be accounted for using the cost method. Except for the investments which meet
the conditions of holding for sale investments in associates and joint ventures shall be accounted for using the
equity method.For a long-term equity investment accounted for using the cost method the cash dividends or profits declared by
the investees for distribution shall be recognised as investment gains and included in profit or loss for the current
period except the case of receiving the actual consideration paid for the investment or the declared but not yet
distributed cash dividends or profits which is included in the consideration.SHANDONG CHENMING PAPER HOLDINGS LIMITED 105
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
14. Long-term equity investments (Cont’d)
(2) Subsequent measurement and method for profit or loss recognition (Cont’d)
For a long-term equity investment accounted for using the equity method where the initial investment cost
exceeds the investor’s interest in the fair value of the investee’s identifiable net assets at the acquisition date no
adjustment shall be made to the investment cost of the long-term equity investment. Where the initial investment
cost is less than the investor’s interest in the fair value of the investee’s identifiable net assets at the acquisition
date adjustment shall be made to the carrying amount of the long-term equity investment and the difference shall
be charged to profit or loss for the current period.Under the equity method investment gain and other comprehensive income shall be recognised based on the
Company’s share of the net profits or losses and other comprehensive income made by the investee respectively.Meanwhile the carrying amount of long-term equity investment shall be adjusted. The carrying amount of long-
term equity investment shall be reduced based on the Group’s share of profit or cash dividend distributed by
the investee. In respect of the other movement of net profit or loss other comprehensive income and profit
distribution of investee the carrying amount of long-term equity investment shall be adjusted and included in
the capital reserves (other capital reserves). The Group shall recognise its share of the investee’s net profits or
losses based on the fair values of the investee’s individual separately identifiable assets at the time of acquisition
after making appropriate adjustments thereto according to the accounting policies and accounting periods of the
Company.For additional equity investment made in order to obtain significant influence or common control over investee
without resulted in control the initial investment cost under the equity method shall be the aggregate of fair value
of previously held equity investment and additional investment cost on the date of transfer. For investments in non-
trading equity instruments that were previously classified as at fair value through other comprehensive income the
cumulative fair value changes associated with them that were previously included in other comprehensive income
are transferred to retained earnings upon the change to the equity method of accounting.In the event of loss of common control or significant influence over investee due to partial disposal of equity
investment the remaining equity interest after disposal shall be accounted for according to the Accounting
Standard for Business Enterprises No. 22 – Recognition and measurement of Financial Instruments. The difference
between its fair value and carrying amount shall be included in profit or loss for the current period. In respect
of other comprehensive income recognised under previous equity investment using equity method it shall be
accounted for in accordance with the same accounting treatment for direct disposal of relevant asset or liability by
investee at the time when equity method was ceased to be used. Movement of other owners’ equity related to the
previous equity investment shall be transferred to profit or loss for the current period.In the event of loss of control over investee due to partial disposal of equity investment the remaining equity
interest which can apply common control or impose significant influence over the investee after disposal shall be
accounted for using equity method. Such remaining equity interest shall be treated as accounting for using equity
method since it is obtained and adjustment was made accordingly. For the remaining equity interest which cannot
apply common control or impose significant influence over the investee after disposal it shall be accounted for
using the Accounting Standard for Business Enterprises No. 22 – Recognition and measurement of Financial
Instruments. The difference between its fair value and carrying amount as at the date of losing control shall be
included in profit or loss for the current period.
106 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
14. Long-term equity investments (Cont’d)
(2) Subsequent measurement and method for profit or loss recognition (Cont’d)
If the shareholding ratio of the Company is reduced due to the capital increase of other investors and as a result
the Company loses the control of but still can apply common control or impose significant influence over the
investee the net asset increase due to the capital increase of the investee attributable to the Company shall be
recognised according to the new shareholding ratio and the difference with the original carrying amount of the
long-term equity investment corresponding to the shareholding ratio reduction part that should be carried forward
shall be recorded in the profit or loss for the current period; and then it shall be adjusted according to the new
shareholding ratio as if equity method is used for accounting when acquiring the investment.In respect of the transactions between the Company and its associates and joint ventures the share of unrealised
gain or loss arising from internal transactions shall be eliminated by the portion attributable to the Company.Investment gain or loss shall be recognised accordingly. However any unrealised loss arising from internal
transactions between the Company and an investee is not eliminated to the extent that the loss is impairment loss
of the transferred assets.
(3) Basis for determining the common control and significant influence on the investee
Common control is the contractually agreed sharing of control over an arrangement which relevant activities of
such arrangement must be decided by unanimously agreement from parties who share control. When determining
if there is any common control it should first be identified if the arrangement is controlled by all the participants
or the group consisting of the participants and then determined if the decision on the arranged activity can be
made only with the unanimous consent of the participants sharing the control. If all the participants or a group
of participants can only decide the relevant activities of certain arrangement through concerted action it can
be considered that all the participants or a group of participants share common control on the arrangement. If
there are two or more participant groups that can collectively control certain arrangement it does not constitute
common control. When determining if there is any common control the relevant protection rights will not be taken
into account.Significant influence is the power of the investor to participate in the financial and operating policy decisions of
an investee but to fail to control or joint control the formulation of such policies together with other parties. When
determining if there is any significant influence on the investee the influence of the voting shares of the investee
held by the investor directly and indirectly and the potential voting rights held by the investor and other parties
which are exercisable in the current period and converted to the equity of the investee including the warrants
stock options and convertible bonds that are issued by the investee and can be converted in the current period
shall be taken into account.When the Company holds directly or indirectly through the subsidiary 20% (inclusive) to 50% of the voting shares
of the investee it is generally considered to have significant influence on the investee unless there is concrete
evidence to prove that it cannot participate in the production and operation decision-making of the investee and
cannot pose significant influence in this situation. When the Company owns less than 20% (exclusive) of the
voting shares of the investee it is generally considered that it has not significantly influenced on the investee
unless there is concrete evidence to prove that it can participate in the production and operation decision-making
of the investee and can impose significant influence in this situation.
(4) Impairment test method and impairment provision
For the method for making impairment provision for the investment in subsidiaries associates and joint ventures
please refer to Note V. 23.SHANDONG CHENMING PAPER HOLDINGS LIMITED 107
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
15. Investment property
Investment property refers to real estate held to earn rentals or for capital appreciation or both. The investment property
of the Company includes leased land use rights land use rights held for sale after appreciation and leased buildings.The investment property of the Company is measured initially at cost upon acquisition and subject to depreciation or
amortisation in the relevant periods according to the relevant provisions on fixed assets or intangible assets.For the method for making impairment provision for the investment property adopted cost method for subsequent
measurement please refer to Note V. 23.When an investment property is sold transferred retired or damaged the amount of proceeds on disposal of the
property net of the carrying amount and related tax and surcharges is recognised in profit or loss for the current period.
16. Fixed assets
(1) Conditions for recognition of fixed assets
Fixed assets represent the tangible assets held by the Company using in the production of goods rendering of
services and for operation and administrative purposes with useful life over one year.Fixed assets are recognised when it is probable that the related economic benefits will flow to the Company and
the costs can be reliably measured.The Company’s fixed assets are initially measured at the actual cost at the time of acquisition.Subsequent expenditures incurred for a fixed asset are included in the cost of the fixed asset when it is probable
that the associated economic benefits will flow to the Company and the related cost can be reliably measured.The cost of routine repairs of fixed assets that do not qualify as capitalised subsequent expenditure is charged to
current profit or loss or included in the cost of the related assets in accordance with the beneficiary object when
incurred. The carrying amount of the replaced part is derecognised.
(2) Depreciation method of fixed assets
The Company adopts the straight-line method for depreciation. Provision for depreciation will be started when the
fixed asset reaches its expected usable state and stopped when the fixed asset is derecognised or classified as a
non-current asset held for sale. Without regard to the depreciation provision the Company determines the annual
depreciation rate by category estimated useful lives and estimated residual value of the fixed assets as below:
Year of Estimated residual Annual depreciation
Category depreciation (year) value (%) rate (%)
Housing and building structure 20-40 5-10 2.25-4.75
Machinery and equipment 8-20 5-10 4.50-11.88
Transportation equipment 5-8 5-10 11.25-19.00
Electronic equipment and others 5 5-10 18.00-19.00
Where for the fixed assets for which impairment provision is made to determine the depreciation rate the
accumulated amount of the fixed asset impairment provision that has been made shall be deducted.
108 SHANDONG CHENMING PAPER HOLDINGS LIMITED
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V. Significant Accounting Policies and Accounting Estimates (Cont’d)
16. Fixed assets (Cont’d)
(3) The impairment test method and impairment provision method of the fixed assets are set out in Note V. 23.
(4) The Company will review the useful lives estimated net residual value and depreciation method of the fixed assets
at the end of each year.When there is any difference between the useful lives estimate and the originally estimated value the useful
lives of the fixed asset shall be adjusted. When there is any difference between the estimated net residual value
estimate and the originally estimated value the estimated net residual value shall be adjusted.
(5) Disposal of fixed assets
A fixed asset is derecognised on disposal or when it is expected that there shall be no economic benefit arising
from using or after disposal. Where the fixed assets are sold transferred retired or damaged the income received
after disposal after deducting the carrying amount and related taxes are recognised in profit or loss for the current
period.
17. Construction in progress
Construction in progress of the Company is recognised based on the actual construction cost including all necessary
expenditures incurred for construction projects capitalised borrowing costs for the construction in progress before it
has reached the working condition for its intended use and other related expenses during the construction period.A construction in progress is reclassified to fixed assets when it has reached the working condition for its intended use.For technological transformation or new machine-made paper projects the projects will be put into trial operation for a
period of time (usually three months) upon completion of construction. After the internal acceptance is completed during
the trial operation period the construction in progress will be transferred to fixed assets.The method for impairment provision of construction in progress is set out in Note V. 23.
18. Materials for project
The materials for project of the Group refer to various materials prepared for construction in progress including
construction materials equipment not yet installed and tools for production.The purchased materials for project are measured at cost and the planning materials for project are transferred to
construction in progress. After the completion of the project the remaining materials for project are transferred to
inventory.The method for impairment provision of materials for project is set out in Note V. 23.The closing balance of materials for project is presented as “construction in progress” item in the balance sheet.SHANDONG CHENMING PAPER HOLDINGS LIMITED 109
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
19. Borrowing costs
(1) Recognition principle for the capitalisation of the borrowing costs
The borrowing costs incurred by the Company directly attributable to the acquisition construction or production
of a qualifying asset will be capitalised and included in the cost of relevant asset. Other borrowing costs will be
recognised as expenses when incurred according to the incurred amount and included in the profit or loss for the
current period. When the borrowing costs meet all the following conditions capitalisation shall be started:
* The capital expenditure has been incurred which includes the expenditure incurred by paying cash
transferring non-cash assets or undertaking interest-bearing liabilities for acquiring constructing or
producing the qualifying assets;
* the borrowing costs have been incurred; and
* the acquisition construction or production activity necessary for the asset to be ready for its intended use
or sale has been started.
(2) Capitalisation period of borrowing costs
When a qualifying asset acquired constructed or produced by the Company is ready for its intended use or sale
the capitalisation of the borrowing costs shall discontinue. The borrowing costs incurred after a qualifying asset
is ready for its intended use or sale shall be recognised as expenses when incurred according to the incurred
amount and included in the profit or loss for the current period.Capitalisation of borrowing costs shall be suspended during periods in which the acquisition construction or
production of a qualifying asset is interrupted abnormally when the interruption is for a continuous period of more
than 3 months. The capitalisation of the borrowing costs shall be continued in the normal interruption period.
(3) Calculation methods for capitalisation rate and capitalised amount of the borrowing costs
Where funds are borrowed for a specific purpose the amount of interest to be capitalised shall be the actual
interest expense incurred on that borrowing for the period less any bank interest earned from depositing the
borrowed funds before being used into banks or any investment income on the temporary investment of those
funds. Where funds are borrowed for general purpose the Company shall determine the amount of interest
to be capitalised on such borrowings by applying a capitalisation rate to the weighted average of the excess
amounts of cumulative expenditures on the asset over and above the amounts of specific-purpose borrowings.The capitalisation rate shall be the weighted average of the interest rates applicable to the general-purpose
borrowings.During the capitalisation period exchange differences on a specific purpose borrowing denominated in foreign
currency shall be capitalised. Exchange differences related to general-purpose borrowings denominated in foreign
currency shall be included in profit or loss for the current period.
110 SHANDONG CHENMING PAPER HOLDINGS LIMITED
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V. Significant Accounting Policies and Accounting Estimates (Cont’d)
20. Bearer biological assets
(1) Standards for recognising bearer biological assets
Bearer biological assets refer to biological assets held for the purpose of producing agricultural products
providing labour services or renting. The Company’s bearer biological assets are mainly tea trees. Bearer
biological assets are initially measured at cost. The cost of a planted or propagated bearer biological asset
includes the expenses directly attributable to the asset and necessarily incurred before the asset is ready for its
intended production and operation including the borrowing costs that are eligible for capitalisation.The management protection and feeding costs of a biological asset subsequent to crown closure or after the
asset is ready for its intended production and operation are expensed and recognised in profit or loss as incurred.According to experience the tea trees grown by the Company generally take 7 years to reach the crown closure
stage.Depreciation of bearer biological assets is calculated using the straight-line method over the estimated useful life
of each biological asset less its residual value as follows:
Estimated residual Annual depreciation
Type of bearer biological assets Useful life (year) value (%) rate (%)
Tea tree 20 5.00
The Company reviews the useful life and estimated net residual value of a bearer biological asset and the
depreciation method applied at least at each financial year-end. A change in the useful life or estimated net
residual value of a fixed asset or the depreciation method used shall be accounted for as a change in accounting
estimate.The difference between the disposal income of the sale loss death or damage of a bearer biological asset net of
its carrying amount and related taxes is recognised in profit or loss for the current period.
(2) Treatment of impairment of bearer biological assets
The method for impairment provision of bearer biological assets is set out in Note V. 23.SHANDONG CHENMING PAPER HOLDINGS LIMITED 111
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
21. Intangible assets
The intangible assets of the Company include land use rights software patents and certificates of third party right.The intangible asset is initially measured at cost and its useful life is determined upon acquisition. If the useful life is
finite the intangible asset will be amortised over the estimated useful life using the amortisation method that can reflect
the estimated realisation of the economic benefits related to the asset starting from the time when it is available for use.If it is unable to reliably determine the estimated realisation straight-line method shall be adopted for amortisation. The
intangible assets with uncertain useful life will not be amortised.The amortisation methods for the intangible assets with finite useful life are as follows:
The basis for determining Method of
Category Useful life useful life amortisation Remark
Land use rights 50-70 Years of certificate Straight-line method
Software 5-10 Estimated years for Straight-line method
software replacement
Patents 5-20 Useful life of purchase Straight-line method
Certificates of third party right 3 Useful life of purchase Straight-line method
The Company reviews the useful life and amortisation method of the intangible assets with finite useful life at the end of
each year. If it is different from the previous estimates the original estimates will be adjusted and will be treated as a
change in accounting estimate.If it is estimated on the balance sheet date that certain intangible asset can no longer bring future economic benefit to
the company the carrying amount of the intangible asset will be entirely transferred into the profit or loss for the current
period.The impairment method for the intangible assets is set out in Note V. 23.
22. R&D expenses
The R&D expenses of the Company are expenses directly related to the R&D activities of the Company including the
wages R&D staff direct investment costs depreciation expenses and long-term prepaid expenses design expenses
equipment testing expenses amortisation expenses of intangible assets and outsourced R&D expenses and other
expenses. Among them the wages of R&D staff are included in R&D expenses based on working hours of related
projects. Equipment production lines and sites shared between R&D activities and other production and operation
activities are included in R&D expenses according to the proportion of working hours and the proportion of area.The Company divides the expenses on internal R&D projects into expenses in the research phase and expenses in the
development phase. All R&D expenses of the Company are included in the current profits and losses when incurred.
112 SHANDONG CHENMING PAPER HOLDINGS LIMITED
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V. Significant Accounting Policies and Accounting Estimates (Cont’d)
23. Asset impairment
Impairment of long-term equity investments in subsidiaries associates and joint ventures asset impairment on
investment property fixed assets construction in progress bearer biological assets measured at cost right-of-
use assets intangible assets goodwill and others (excluding inventories deferred tax assets and financial assets)
subsequently measured at cost is determined as follows:
The Company determines if there is any indication of asset impairment as at the balance sheet date. If there is any
evidence indicating that an asset may be impaired recoverable amount shall be estimated for impairment test. Goodwill
arising from business combinations intangible assets with an indefinite useful life and intangible assets not ready for
intended use will be tested for impairment annually regardless of whether there is any indication of impairment.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. The Company estimates the recoverable amount of an
individual asset. If it is not possible to estimate the recoverable amount of the individual asset the Company shall
determine the recoverable amount of the asset group to which the asset belongs. The determination of an asset group
is based on whether major cash inflows generated by the asset group are independent of the cash inflows from other
assets or asset groups.When the recoverable amount of an asset or an asset group is less than its carrying amount the carrying amount is
reduced to its recoverable amount. The reduction amount is charged to profit or loss and an impairment provision is
made accordingly.For the purpose of impairment test of goodwill the carrying amount of goodwill acquired in a business combination is
allocated to the relevant asset groups on a reasonable basis from the acquisition date; where it is difficult to allocate
to the related asset groups it is allocated to the combination of related asset groups. The related asset groups or
combination of asset groups are those which can benefit from the synergies of the business combination and are not
larger than the reportable segments identified by the Company.In the impairment test if there is any indication that an asset group or a combination of asset groups related to goodwill
may be impaired the Company first tests the asset group or set of asset groups excluding goodwill for impairment
calculates the recoverable amount and recognises the corresponding impairment loss. An impairment test is then carried
out on the asset group or combination of asset groups containing goodwill by comparing its carrying amount with its
recoverable amount. If the recoverable amount is lower than the carrying amount an impairment loss is recognised for
goodwill.An impairment loss recognised shall not be reversed in a subsequent period.
24. Long-term prepaid expenses
The long-term prepaid expenses incurred by the Company shall be recognised based on the actual cost and evenly
amortised over the estimated benefit period. For the long-term prepaid expense that cannot benefit the subsequent
accounting periods its value after amortisation shall be entirely included in the profit or loss for the current period.
25. Contract liabilities
A contract liability represents the Company’s obligation to transfer goods to a customer for which the Company has
received consideration (or an amount of consideration is due) from the customer. If the customer has already paid
the contract consideration before the Company transfers goods to the customer or the Company has obtained the
unconditional collection right the Company will recognise such amount received or receivable as contract liabilities
at earlier of the actual payment by the customer or the amount payable becoming due. Contract assets and contract
liabilities under the same contract are presented on a net basis and contract assets and contract liabilities under
different contracts are not offset.SHANDONG CHENMING PAPER HOLDINGS LIMITED 113
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
26. Employee benefits
(1) Scope of employee benefits
Employee benefits are all forms of considerations or compensation given by an entity in exchange for services
rendered by employees or for the termination of employment. Employee benefits include short-term staff
remuneration post-employment benefits termination benefits and other long-term employee benefits. Employee
benefits include benefits provided to employees’ spouses children other dependants survivors of the deceased
employees or other beneficiaries.Employee benefits are presented as “employee benefits payable” and “long-term employee benefits payable” in
the balance sheet respectively according to liquidity.
(2) Short-term staff remuneration
Employee wages or salaries actually incurred bonuses and social insurance contributions such as medical
insurance work injury insurance maternity insurance and housing fund contributed at the applicable benchmarks
and rates are recognised as a liability as the employees provide services with a corresponding charge to profit or
loss or included in the cost of assets where appropriate.
(3) Post-employment benefits
Post-employment benefit plans include defined contribution plans and defined benefit plans. A defined
contribution plan is a post-employment benefit plan under which the Company pays fixed contributions into
a separate fund and the Company has no further obligations for payment. A defined benefit plan is a post-
employment benefit plan other than a defined contribution plan.Defined contribution plans
Defined contribution plans include basic pension insurance unemployment insurance and enterprise annuity plan (if
any).During the accounting period in which an employee provides service the amount payable calculated according to
the defined contribution plan is recognised as a liability and included in the profit or loss for the current period or
the cost of relevant assets.
(4) Termination benefits
When the Company provides termination benefits to employees employee benefits liabilities arising from
termination benefits are recognised in profit or loss for the current period at the earlier of the following dates: when
the Company cannot revoke unilaterally compensation for dismissal due to the cancellation of labour relationship
plans and employee redundant proposals; the Company recognises cost and expenses related to payment of
compensation for dismissal and restructuring.For the early retirement plans economic compensations before the actual retirement date were classified as
termination benefits. During the period from the date of cease of render of services to the actual retirement
date relevant wages and contribution to social insurance for the employees proposed to be paid are recognised
in profit or loss on a one-off basis. Economic compensation after the official retirement date such as normal
pension is accounted for as post-employment benefits.
114 SHANDONG CHENMING PAPER HOLDINGS LIMITED
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V. Significant Accounting Policies and Accounting Estimates (Cont’d)
26. Employee benefits (Cont’d)
(5) Other long-term benefits
Other long-term employee benefits provided by the Group to employees that meet the conditions for defined
contribution plans are accounted for in accordance with the relevant provisions relating to defined contribution
plans as stated above. If the conditions for defined benefit plans are met the benefits shall accounted for inaccordance with the relevant provisions relating to defined benefit plans but the “changes arising from theremeasurement of net liabilities or net assets of defined benefit plans” in the relevant employee benefits shall be
included in the current profit and loss or the relevant costs of assets.
27. Provisions
Obligations pertinent to the contingencies which satisfy the following conditions are recognised by the Company as
provisions:
(1) the obligation is a current obligation borne by the Company;
(2) it is likely that an outflow of economic benefits from the Company will be resulted from the performance of the
obligation;
(3) the amount of the obligation can be reliably measured.
The provisions shall be initially measured based on the best estimate for the expenditure required for the performance
of the current obligation after taking into account relevant risks uncertainties time value of money and other
factors pertinent to the contingencies. If the time value of money has significant influence the best estimates shall
be determined after discounting the relevant future cash outflow. The Company reviews the carrying amount of the
provisions on the balance sheet date and adjust the carrying amount to reflect the current best estimates.If all or some expenses incurred for settlement of recognised provisions are expected to be borne by the third party
the compensation amount shall on a recoverable basis be recognised as asset separately and compensation amount
recognised shall not be more than the carrying amount of provisions.
28. Share-based payments and equity instruments
(1) Category of share-based payment
The Company’s share-based payment is either equity-settled or cash-settled.
(2) Determination of fair value of equity instruments
For the existence of an active market for options and other equity instruments granted by the Company the fair
value is determined at the quoted price in the active market. For options and other equity instruments with no
active market option pricing model shall be used to estimate the fair value of the equity instruments. The following
factors shall be taken into account using option pricing models: A. the exercise price of the option; B. the validity
period of the option; C. the current market price of the share; D. the expected volatility of the share price; E.predicted dividend of the share; and F. risk-free rate of the option within the validity period.SHANDONG CHENMING PAPER HOLDINGS LIMITED 115
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V. Significant Accounting Policies and Accounting Estimates (Cont’d)
28. Share-based payments and equity instruments (Cont’d)
(3) Recognition of vesting of equity instruments based on the best estimate
On each balance sheet date within the vesting period the estimated number of equity instruments expected to
vest is revised based on the best estimate made by the Company according to the latest available subsequent
information as to changes in the number of employees with exercisable rights. On the vesting date the final
estimated number of equity instruments expected to vest should equal the actual number of equity instruments
expected to vest.
(4) Accounting treatment of implementation modification and termination of share-based payment
Equity-settled share-based payment shall be measured at the fair value of the equity instruments granted to
employees. For those may immediately vest after the grant the fair value of equity instrument at the grant date
shall be included in the relevant costs or expenses and the capital reserve shall be increased accordingly.If the right may not be exercised until the vesting period comes to an end or until the specified performance
conditions are met on each balance sheet date within the vesting period the services obtained in the current
period shall based on the best estimate of the number of vested equity instruments be included in the relevant
costs or expenses and the capital reserve at the fair value of the equity instrument at the grant date. After the
vesting period relevant costs or expenses and total shareholders’ equity which have been recognised will not be
adjusted.Cash-settled share-based payment shall be measured in accordance with the fair value of liability calculated
and recognised based on the shares or other equity instruments undertaken by the Company. For those may
immediately vest after the grant the fair value of the liability undertaken by the Company shall on the date of the
grant be included in the relevant costs or expenses and the liabilities shall be increased accordingly. If the right
may not be exercised until the vesting period comes to an end or until the specified performance conditions are
met on each balance sheet date within the vesting period the services obtained in the current period shall based
on the best estimate of the information about the exercisable right be included in the relevant costs or expenses
and the corresponding liabilities at the fair value of the liability undertaken by the Company. For each of the
balance sheet date and settlement date before the settlement of the relevant liabilities fair value of the liabilities
shall be remeasured and the changes will be included in the profit or loss for the current period.When there are changes in Company’s share-based payment plans if the modification increases the fair value of
the equity instruments granted corresponding recognition of service increase in accordance with the increase in
the fair value of the equity instruments; if the modification increases the number of equity instruments granted
the increase in fair value of the equity instruments is recognised as a corresponding increase in service achieved.An increase in the fair value of equity instruments refers to the difference between the fair values of the modified
date. If the modification reduces the total fair value of shares paid or not conductive to the use of other employees
share-based payment plans to modify the terms and conditions of service it will continue to be accounted for in
the accounting treatment as if the change had not occurred unless the Company cancelled some or all of the
equity instruments granted.During the vesting period if the cancelled equity instruments (except for failure to meet the conditions of the non-
market vesting conditions) granted by the Company to cancel the equity instruments granted amount treated as
accelerated vesting of the remaining period should be recognised immediately in profit or loss while recognising
capital reserves. If employees or other parties can choose to meet non-vesting conditions but they are not met in
the vesting period the Company will treat them as cancelled equity instruments granted.
116 SHANDONG CHENMING PAPER HOLDINGS LIMITED
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V. Significant Accounting Policies and Accounting Estimates (Cont’d)
28. Share-based payments and equity instruments (Cont’d)
(5) Restricted shares
If the Company grants the restricted shares to incentive participants under an equity incentive plan the incentive
participants shall subscribe for the shares first. If the unlocking conditions stipulated in the equity incentive plan
cannot be fulfilled subsequently the Company repurchase the shares at the predetermined price. If the registration
and other capital increase procedures for the restricted shares issued to employees are completed in accordance
with relevant regulations the Company recognises share capital and capital reserve (or capital premium) based on
the subscription money received from the employees on the grant date; and recognises treasury shares and other
payables for repurchase obligation.
29. Other financial instruments such as preference shares and Perpetual Bonds
(1) Classification of financial liabilities and equity instruments
Financial instruments issued by the Company are classified into financial assets 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 asset financial liability and equity instruments on initial
recognition.
(2) Accounting treatment of other financial instruments such as preference shares and Perpetual Bonds
Financial instruments issued by the Company are initially recognised and measured in accordance with the
financial instrument standards; thereafter interest or dividends are accrued on each balance sheet date and
accounted for in accordance with relevant specific ASBEs i.e. to determine the accounting treatment for interest
expenditure or dividend distribution of the instrument based on the classification of the financial instrument issued.For financial instruments classified as equity instruments their interest expenses or dividend distributions are
treated as profit distribution of the Company and their repurchases and cancellations are treated as changes in
equity; for financial instruments classified as financial liabilities their interest expenses or dividend distribution are
in principle accounted for with reference to borrowing costs and the gains or losses arising from their repurchases
or redemption are included in the profit or loss for the current period.For the transaction costs such as fees and commissions incurred by the Company for issuing financial
instruments if such financial instruments are classified as debt instruments and measured at amortised cost they
are included in the initial measured amount of the instruments issued; if such financial instruments are classified
as equity instruments they are deducted from equity.SHANDONG CHENMING PAPER HOLDINGS LIMITED 117
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
30. Revenue
(1) General principles
The Company recognises revenue when it satisfies a performance obligation in the contract i.e. when the
customer obtains control of the relevant goods or services.Where a contract has two or more performance obligations the Company allocates the transaction price to each
performance obligation based on the percentage of respective unit price of goods or services guaranteed by
each performance obligation and recognises as revenue based on the transaction price that is allocated to each
performance obligation.If one of the following conditions is fulfilled the Company performs its performance obligation within a certain
period; otherwise it performs its performance obligation at a point of time:
* when the customer simultaneously receives and consumes the benefits provided by the Company when the
Company performs its obligations under the contract;
* when the customer is able to control the goods in progress in the course of performance by the Company
under the contract;
* when the goods produced by the Company under the contract are irreplaceable and the Company has the
right to payment for performance completed to date during the whole contract term.For performance obligations performed within a certain period the Company recognises revenue by measuring
the progress towards complete of that performance obligation within that certain period. When the progress
of performance cannot be reasonably determined if the costs incurred by the Company are expected to be
compensated the revenue shall be recognised at the amount of costs incurred until the progress of performance
can be reasonably determined.For performance obligation performed at a point of time the Company recognises revenue at the point of time at
which the customer obtains control of relevant goods or services. To determine whether a customer has obtained
control of goods or services the Company considers the following indications:
* The Company has the current right to receive payment for the goods which is when the customer has the
current payment obligations for the goods.* The Company has transferred the legal title of the goods to the customer which is when the client
possesses the legal title of the goods.* The Company has transferred the physical possession of goods to the customer which is when the
customer obtains physical possession of the goods.* The Company has transferred all of the substantial risks and rewards of ownership of the goods to the
customer which is when the customer obtain all of the substantial risks and rewards of ownership of the
goods to the customer.* The customer has accepted the goods or services.* Other information indicates that the customer has obtained control of the goods.
118 SHANDONG CHENMING PAPER HOLDINGS LIMITED
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V. Significant Accounting Policies and Accounting Estimates (Cont’d)
30. Revenue (Cont’d)
(2) Specific methods
The Company’s revenue mainly comes from the following types of business: sales of goods provision of hotel and
property services and provision of financial leasing and factoring services.Sales of goods
The Company produces and sells machine-made paper and raw materials electricity and steam construction
materials papermaking chemicals plastic automobile accessories moulds and other products.In terms of domestic sales revenue is recognised at a point in time when the control over the goods is transferred
after the Company has delivered the goods (other than electricity and steam) sold to the location as specified in
the contract and the customer has accepted the goods.In terms of overseas sales revenue is recognised on the day when the goods (other than electricity and steam)
sold are loaded on board and declared.The sales of electricity and steam by the Company are performance obligations performed within a certain
period. For sales of electricity the Company recognises revenue from sales of electricity based on the quantity of
electricity delivered to customers every month at a price agreed in the contract. For sales of steam the Company
recognises revenue from sales of steam based on the amount of steam delivered to customers every month at a
price agreed in the contract.The credit periods granted by the Company to customers in various industries are consistent with the practices of
various industries therefore there is no significant financing component.The Company provides product quality assurance for the sales of products and recognises corresponding
provisions. The Company does not provide any additional services or additional quality assurance so the product
quality assurance does not constitute a separate fulfilment obligation.The Company’s cooperation model with distributors is outright sales and the recognition of sales revenue under
the distribution model is consistent with the direct sales model.Certain contracts between the Company and its customers contain arrangements on sales rebates which will give
rise to variable consideration. Where a contract contains variable consideration the Company determines the best
estimates on the variable consideration based on expected values or the most probable amount provided that
transaction prices including variable consideration shall not exceed the cumulative amount of recognised revenue
upon the removal of relevant uncertainties in connection with which a significant reversal is highly unlikely.For sales of machine-made paper with sales return clauses the revenue recognised is subject to the cumulative
amount of recognised revenue in connection with which a significant reversal is highly unlikely. The Company
recognises the liabilities according to the expected amount of refund and recognises the carrying amount of the
goods returned at the time of transfer deducting the estimated cost of recovering the goods as an asset (including
the loss of the value of the returned goods).SHANDONG CHENMING PAPER HOLDINGS LIMITED 119
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V. Significant Accounting Policies and Accounting Estimates (Cont’d)
30. Revenue (Cont’d)
(2) Specific methods (Cont’d)
Provision of hotel and property services
The Company provides hotel and property services to external parties. Since the customers obtain and consume
the economic benefits brought by the Company’s performance of the contract while the Company performs the
contract the Company recognises revenue according to the progress of the contract performance. Since the
performance progress occurs evenly the Company recognises revenue by amortising on a straight-line basis over
the service period.Provision of financial leasing and factoring services
The Company recognises revenue from external financial leasing and factoring services according to the effective
interest rate.For assets that have not experienced credit impairment the Company determines its interest income based on
the amount of the book balance of the financial asset (i.e. without considering the impact of impairment) multiplied
by the effective interest rate.There are two cases for financial assets with credit impairment:
For financial assets that are not credit-impaired when purchased or originated but are credit-impaired in
subsequent periods the Company shall in the subsequent periods when impairment occurs determine its
income based on the amount of the amortised cost of the financial asset (i.e. the book balance minus the accrued
impairment) multiplied by the effective interest rate (the effective interest rate determined at the time of initial
recognition which does not change due to the occurrence of impairment).For financial assets that are credit-impaired when purchased or originated the Company shall upon initial
recognition determines its income based on the amount of the amortised cost of the financial asset multiplied
by the credit-adjusted effective interest rate (i.e. the interest rate at which the projected future cash flows after
impairment are discounted to the amortised cost at the time of purchase or origination).
120 SHANDONG CHENMING PAPER HOLDINGS LIMITED
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V. Significant Accounting Policies and Accounting Estimates (Cont’d)
31. Contract costs
Contract costs are either the incremental costs of obtaining a contract with a customer or the costs to fulfil a contract
with a customer.Incremental costs of obtaining a contract are those costs that the Company incurs to obtain a contract with a customer
that it would not have incurred if the contract had not been obtained e.g. sales commission. The Company recognises
the incremental costs of obtaining a contract with a customer as an asset if it expects to recover those costs. Other
costs of obtaining a contract other than incremental costs that are expected to be recovered are recognised in profit or
loss in the period in which they are incurred.If the costs to fulfil a contract with a customer are not within the scope of inventories or other ASBEs the Company
recognises an asset from the costs incurred to fulfil a contract only if those costs meet all of the following criteria:
* the costs relate directly to an existing contract or to a specifically identifiable anticipated contract including direct
labour direct materials allocations of overheads (or similar costs) costs that are explicitly chargeable to the
customer and other costs that are incurred only because the Company entered into the contract;
* the costs generate or enhance resources of the Company that will be used in satisfying (or in continuing to satisfy)
performance obligations in the future;
* the costs are expected to be recovered.Assets recognised for the incremental costs of obtaining a contract and assets recognised for the costs to fulfil a
contract (the “assets related to contract costs”) are amortised on a systematic basis that is consistent with the transfer
to the customer of the goods or services to which the assets relate and recognised in profit or loss for the current
period. If the amortisation period does not exceed one year it shall be recognised in profit or loss for the current period.The Company recognises an impairment loss in profit or loss to the extent that the carrying amount of an asset related
to contract costs exceeds:
* remaining amount of consideration that the Company expects to receive in exchange for the goods or services to
which the asset relates;
* the cost estimated to be happened for the transfer of related goods or services.SHANDONG CHENMING PAPER HOLDINGS LIMITED 121
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
32. Government grants
A government grant is recognised when the grant will be received and that the Company will comply with the conditions
attaching to the grant.If a government grant is in the form of a monetary asset it is measured at the amount received or receivable. If a
government grant is in the form of non-monetary asset it is measured at fair value; if the fair value cannot be obtained in
a reliable way it is measured at the nominal amount of RMB1.Government grants obtained for acquisition or construction of long-term assets or other forms of long-term asset
formation are classified as government grants related to assets while the remaining government grants are classified as
government grants related to revenue.Regarding the government grant not clearly defined in the official documents and can form long-term assets the part
of government grant which can be referred to the value of the assets is classified as government grant related to assets
and the remaining part is government grant related to revenue. For the government grant that is difficult to distinguish
the entire government grant is classified as government grant related to revenue.A government grant related to an asset shall be recognised as deferred income and evenly amortised to profit or loss
over the useful life of the asset in a reasonable and systematic manner. For a government grant related to revenue if
the grant is a compensation for related costs expenses or losses incurred the grant shall be recognised in profit or
loss for the current period or used to offset related costs; if the grant is a compensation for related costs expenses or
losses to be incurred in subsequent periods the grant shall be recognised as deferred income and recognised in profit
or loss over the periods in which the related costs expenses or losses are recognised or used to offset related costs. A
government grant measured at nominal amount is directly included in profit or loss for the current period. The Company
adopts a consistent approach to the same or similar government grants.A government grant related to daily activities is recognised in other gains or used to offset related costs relying on
the essence of economic business; otherwise recognised in non-operating income or used to offset non-operating
expenses.For the repayment of a government grant already recognised if the carrying amount of relevant assets was written off
at initial recognition the carrying amount of the assets shall be adjusted; if there is any related deferred income the
repayment shall be offset against the carrying amount of the deferred income and any excess shall be recognised in
profit or loss for the current period; otherwise the repayment shall be recognised immediately in profit or loss for the
current period.
122 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
33. Deferred income tax assets/deferred income tax liabilities
Income tax comprises current income tax expense and deferred income tax expense which are included in profit or
loss for the current period as income tax expenses except for deferred tax related to transactions or events that are
directly recognised in owners’ equity which are recognised in owners’ equity and deferred tax arising from a business
combination which is adjusted against the carrying amount of goodwill.Temporary differences arising from the difference between the carrying amount of an asset or liability and its tax base
at the balance sheet date of the Company shall be recognised as deferred income tax using the balance sheet liability
method.All the taxable temporary differences are recognised as deferred income tax liabilities except for those incurred in the
following transactions:
(1) The initial recognition of goodwill and the initial recognition of an asset or liability in a transaction which is neither
a business combination nor affects accounting profit or taxable profit (or deductible loss) when the transaction
occurs (other than a single transaction that the initially recognised assets and liabilities result in an equal amount
of taxable temporary differences and deductible temporary differences);
(2) The taxable temporary differences associated with investments in subsidiaries associates and joint ventures and
the Company 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.The Company recognises a deferred income tax asset for the carry forward of deductible temporary differences
deductible losses and tax credits to subsequent periods to the extent that it is probable that future taxable profits
will be available against which the deductible temporary differences deductible losses and tax credits can be utilised
except for those incurred in the following transactions:
(1) The transaction is neither a business combination nor affects accounting profit or taxable profit (or deductible loss)
when the transaction occurs (other than a single transaction that the initially recognised assets and liabilities result
in an equal amount of taxable temporary differences and deductible temporary differences);
(2) The deductible temporary differences associated with investments in subsidiaries associates and joint ventures
the corresponding deferred income tax asset is recognised when both of the following conditions are satisfied: it is
probable that the temporary difference will reverse in the foreseeable future and it is probable that taxable profits
will be available in the future against which the temporary difference can be utilised.At the balance sheet date deferred income tax assets and deferred income tax liabilities are measured at the tax
rates that are expected to apply to the period when the asset is realised or the liability is settled and their tax effect is
reflected accordingly.At the balance sheet date the Company reviews the carrying amount of a deferred income tax asset. If it is probable
that sufficient taxable profits will not be available in future periods to allow the benefit of the deferred tax asset to be
utilised the carrying amount of the deferred tax asset is reduced. Any such reduction in amount is reversed when it
becomes probable that sufficient taxable profits will be available.SHANDONG CHENMING PAPER HOLDINGS LIMITED 123
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
33. Deferred income tax assets/deferred income tax liabilities (Cont’d)
At the balance sheet date deferred income tax assets and deferred income tax liabilities are presented as the net
amount after offsetting when the following conditions are met at the same time:
(1) The tax payer within the Company has the legal right to settle current income tax assets and current income tax
liabilities on a net basis;
(2) Deferred income tax assets and deferred income tax liabilities are related to income taxes levied by the same tax
collection and administration authority on the same taxpayer within the Company.
34. Leases
(1) Identification of leases
On the beginning date of the contract the Company (as a lessee or lessor) assesses whether the customer in
the contract has the right to obtain substantially all of the economic benefits from use of the identified asset
throughout the period of use and has the right to direct the use of the identified asset throughout the period of
use. If a contract conveys the right to control the use of an identified asset and multiple identified assets for a
period of time in exchange for consideration the Company identifies such contract is or contains a lease.
(2) The Company as lessee
On the beginning date of the lease the Company recognises right-of-use assets and lease liabilities for all leases
except for short-term lease and low-value asset lease with simplified approach.The accounting policy for right-of-use assets is set out in Note V. 35.The lease liability is initially measured at the present value of the lease payments that are not paid at the beginning
date of the lease using the interest rate implicit in the lease. Where the interest rate implicit in the lease cannot be
determined the incremental borrowing rate is used as the discount rate. Lease payments include fixed payments
and in-substance fixed payments less any lease incentives receivable; variable lease payments that are based
on an index or a rate; the exercise price of a purchase option if the lessee is reasonably certain to exercise
that option; payments for terminating the lease if the lease term reflects the lessee exercising that option of
terminating; and amounts expected to be payable by the lessee under residual value guarantees. Subsequently
the interest expense on the lease liability for each period during the lease term is calculated using a constant
periodic rate of interest and is recognised in profit or loss for the current period. Variable lease payments not
included in the measurement of lease liabilities are recognised in profit or loss for the period in which they actually
arise.
124 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
34. Leases (Cont’d)
(2) The Company as lessee (Cont’d)
Short-term lease
Short-term leases refer to leases with a lease term of less than 12 months from the commencement date except
for those with a purchase option.Lease payments on short-term leases are recognised in the cost of related assets or current profit or loss on a
straight-line basis over the lease term.For short-term leases the Company chooses to adopt the above simplified approach for the following types of
assets that meet the conditions of short-term lease according to the classification of leased assets.* Low-value equipment
* Transportation vehicles
Low-value asset lease
A low-value asset lease is a lease that the value of a single leased asset is below RMB40000 when it is a new
asset.Lease payments on low-value asset leases are recognised on a straight-line basis over the lease term and either
included in the cost of the related asset or charged to profit or loss for the current period.For a low-value asset lease the Company chooses the above simplified approach based on the specific
circumstances of each lease.Lease modification
The Company accounts for a lease modification as a separate lease when the modification occurs and the
following conditions are met: * the lease modification expands the scope of lease by adding the right to use
one or more of the leased assets; and * the increase in consideration is equivalent to the separate price for the
expanded scope of lease adjusted for that contractual situation.Where a lease modification is not accounted for as a separate lease at the effective date of the lease modification
the Company reallocates the consideration of the modified contract redetermines the lease term and remeasures
the lease liability based on the present value of the lease payments after the modification and the revised discount
rate.If a lease modification results in a reduction in the scope of the lease or a shortening of the lease term the
Company reduces the carrying amount of the right-of-use asset accordingly and includes in the profit or loss for
the period the gain or loss associated with the partial or complete termination of the lease.Where other lease modifications result in a remeasurement of the lease liability the Company adjusts the carrying
amount of the right-of-use asset accordingly.SHANDONG CHENMING PAPER HOLDINGS LIMITED 125
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
34. Leases (Cont’d)
(3) The Company as lessor
When the Company is a lessor a lease is classified as a finance lease whenever the terms of the lease transfer
substantially all the risks and rewards of asset ownership to the lessee. All leases other than financial leases are
classified as operating leases.Finance leases
Under finance leases the Company accounts for finance lease receivables at the beginning of the lease term at
the net lease investment which is the sum of the unsecured residual value and the present value of the lease
receipts outstanding at the commencement date of the lease discounted at the interest rate implicit in the lease.The Company as lessor calculates and recognises interest income for each period of the lease term based on
a fixed periodic interest rate. Variable lease payments acquired by the Company as lessor that are not included
in the net measurement of lease investments are included in profit or loss for the period when they are actually
incurred.Derecognition and impairment of finance lease receivables are accounted for in accordance with the requirements
under the Accounting Standard for Business Enterprises No. 22 – Recognition and Measurement of Financial
Instruments and the Accounting Standards for Business Enterprises No. 23 – Transfer of Financial Assets.Operating lease
Lease payments on short-term leases are recognised in the cost of related assets or current profit or loss on a
straight-line basis over the lease term. Lease payments under operating leases are recognised in profit or loss on
a straight-line basis over the lease term. Initial direct costs incurred in relation to operating leases are capitalised
and amortised over the lease term on the same basis as rental income and recognised in profit or loss for the
current period. The variable lease payments obtained in relation to operating leases that are not included in the
lease payments are recognised in profit or loss in the period in which they actually incurred.Lease modification
The Company accounts for a modification in an operating lease as a new lease from the effective date of the
modification and the amount of lease receipts received in advance or receivable in respect of the lease prior to the
modification is treated as a receipt under the new lease.The Company accounts for a modification in a finance lease as a separate lease when the change occurs and
the following conditions are met: * the modification expands the scope of lease by adding the right to use one
or more of the leased assets; and * the increase in consideration is equivalent to the separate price for the
expanded scope of lease adjusted for that contractual situation.Where a finance lease is modified and not accounted for as a separate lease the Company accounts for the
modified lease in the following circumstances: * If the modification takes effect on the lease commencement
date the lease will be classified as an operating lease the Company will account for it as a new lease from the
effective date of the lease modification and use the net lease investment before the effective date of the lease
modification; * If the modification takes effect on the lease commencement date the lease will be classified as a
finance lease and the Company will conduct accounting treatment in accordance with the Accounting Standards
for Business Enterprises No. 22 – Recognition and Measurement of Financial Instruments on modifying or
renegotiating contracts.
126 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
34. Leases (Cont’d)
(4) Sublease
When the Company is an intermediate lessor the sublease is classified with reference to the right-of-use assets
arising from the head lease. If the head lease is a short-term lease for which the Company adopts a simplified
approach then the Company classifies the sublease as an operating lease.
(5) Sale and leaseback
The lessee and the lessor shall assess and determine whether the transfer of assets in a sale and leaseback
transaction is a sale in accordance with the requirements of the Accounting Standard for Business Enterprises No.
14 – Revenue.
Where asset transfer under the sale and leaseback transactions is a sale the lessee shall measure the right-
of-use assets created by the sale and leaseback based on the portion of carrying amount of the original assets
related to right of use obtained upon leaseback and only recognise relevant profit or loss for the right transferred
to the lessor. The lessor shall account for the purchase of assets in accordance with other applicable ASBEs and
account for the lease of assets in accordance with this standard.Where asset transfer under the sale and leaseback transactions is not a sale the lessee shall continue to
recognise the transferred assets while recognising a financial liability equal to the transfer income and account
for such liability according to the Accounting Standard for Business Enterprises No. 22 – Recognition and
Measurement of Financial Instruments; or not to recognise the transferred assets but recognise a financial asset
equal to the transfer income and account for such asset according to the Accounting Standard for Business
Enterprises No. 22 – Recognition and Measurement of Financial Instruments.
35. Right-of-use assets
(1) Conditions for recognition of right-of-use assets
Right-of-use assets are defined as the right of underlying assets in the lease term for the Company as a lessee.Right-of-use assets are initially measured at cost at the commencement date of the lease. The cost includes the
amount of the initial measurement of lease liability; lease payments made at or before the inception of the lease
less any lease incentives enjoyed; initial direct costs incurred by the Company as lessee; costs to be incurred in
dismantling and removing the underlying assets restoring the site on which it is located or restoring the underlying
asset to the condition required by the terms and conditions of the lease incurred by the Company as lessee. As
a lessee the Company recognises and measures the costs of dismantling and restoration in accordance with the
Accounting Standard for Business Enterprises No. 13 – Contingencies. Subsequently the lease liability is adjusted
for any remeasurement of the lease liability.
(2) Depreciation method of right-of-use assets
The Company uses the straight-line method for depreciation. Where the Company as a lessee is reasonably
certain to obtain ownership of the leased asset at the end of the lease term such asset is depreciated over the
remaining useful life of the leased asset. Where ownership of the lease assets during the lease term cannot be
reasonably determined right-of-use assets are depreciated over the lease term or the remainder of useful lives of
the lease assets whichever is shorter.
(3) For the methods of impairment test and impairment provision of right-of-use assets please refer to Note V. 23.
SHANDONG CHENMING PAPER HOLDINGS LIMITED 127
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
36. Production safety expenses and maintenance costs
According to relevant provisions the Company makes provisions for production safety expenses based on the revenue
of the power plant in the previous year and the prescribed percentages. The specific provisions are as follows: * if
the revenue of the previous year did not exceed RMB10 million provisions would be made at 3%; * if the revenue of
the previous year exceeded RMB10 million but did not exceed RMB100 million provisions would be made at 1.5%; *
if the revenue of the previous year exceeded RMB100 million but did not exceed RMB1000 million provisions would
be made at 1%; * if the revenue of the previous year exceeded RMB1000 million but did not exceed RMB5000
million provisions would be made at 0.8%; * if the revenue of the previous year exceeded RMB5000 million but did
not exceed RMB10000 million provisions would be made at 0.6%; * if the revenue of the previous year exceeded
RMB10000 million provisions would be made at 0.2%.Provisions for production safety expenses are included in the cost of related products or profit or loss of the current
period and included in “special reserves” correspondingly.When the provisions for production safety expenses and maintenance costs are utilised within the prescribed scope
if such production safety expenses are applied and related to revenue expenditures specific reserve is directly offset.When fixed assets are incurred they are included in the “construction in progress” item and transferred to fixed assets
when the status of the assets is ready for intended use. They are then offset against specific reserve based on the
amount included in fixed assets while corresponding amount is recognised in accumulated depreciation. Such fixed
assets are no longer depreciated in subsequent periods.
37. Repurchase of shares
Prior to cancellation or transfer of shares repurchased the Company recognises all expenditures arising from share
repurchase as cost of treasury shares in the treasury share account. Considerations and transaction fee incurred from
the repurchase of shares shall lead to the elimination of owners’ equity and does not recognise profit or loss when
shares of the Company are repurchased transferred or cancelled.The difference between the actual amount received and the carrying amount of the treasury shares are recognised as
capital reserve when the treasury shares are transferred if the capital reserve is not sufficient to be offset the excess
amount shall be recognised to offset surplus reserve and retained profit. When the treasury shares are cancelled
the capital shall be eliminated according to the number of shares and par value of cancelled shares the difference
between the actual amount received and the carrying amount of the treasury shares are recognised as capital reserve
if the capital reserve is not sufficient to be offset the excess amount shall be recognised to offset surplus reserve and
retained profit.
128 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
38. Debt restructuring
(1) The Company as the debtor
The debt is derecognised when the current obligation of the debt is discharged. Specifically when the uncertainty
about the execution process and results of the debt restructuring agreement is eliminated the gains and losses
related to the debt restructuring are recognised.If debt restructuring is carried out by repaying debts with assets the Company shall derecognise the relevant
assets and the debts paid off when they meet the conditions for derecognition and the difference between the
book value of the debts paid off and the book value of the transferred assets shall be included in the current profit
and loss.If the debt is converted into equity instruments for debt restructuring the Company shall derecognise the debts
paid off when they meet the conditions for derecognition. When the Company initially recognises an equity
instrument it is measured based on the fair value of the equity instrument. If the fair value of the equity instrument
cannot be measured reliably it is measured based on the fair value of the debt paid off. The difference between
the book value of the debts paid off and the recognised amount of the equity instrument shall be included in the
current profit and loss.When a debt restructuring involves the modification of other terms of a debt the Company shall recognise and
measure the restructured debts in accordance with the Accounting Standards for Business Enterprises No. 22 –
Recognition and Measurement of Financial Instruments and the Accounting Standards for Business Enterprises
No. 37 – Presentation of Financial Instruments.When a debt is settled by multiple assets or combination of various methods in a debt restructuring the Company
shall recognise and measure the equity instruments and restructured debts in accordance with the aforementioned
methods and the difference between the book value of the debts paid off and the sum of the book value of the
transferred assets and the recognised amount of the equity instruments and restructured debts shall be included
in the current profit and loss.SHANDONG CHENMING PAPER HOLDINGS LIMITED 129
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
38. Debt restructuring (Cont’d)
(2) The Company as the creditor
The debt receivable are derecognised when the contractual rights to receive the cash flows under the debt
receivable expire. Specifically when the uncertainty about the execution process and results of the debt
restructuring agreement is eliminated the gains and losses related to the debt restructuring are recognised.If debt restructuring is carried out by repaying debts with assets the Company shall initially recognise assets
other than the transferred financial assets at cost. In particular the cost of inventories includes the fair value of the
debt receivable and any directly attributable expenditure including taxes transportation costs handling costs
insurance and other costs for bringing the assets to the current position and condition; the cost of investment
in associates or joint ventures includes the fair value of the debt receivable and any directly attributable taxes
and other costs; the cost of investment property includes the fair value of the debt receivable and any directly
attributable taxes and other costs; the cost of fixed assets includes the fair value of the debt receivable and
any directly attributable expenditure including taxes transportation costs handling costs installation costs
professional service fees and other costs for bringing the assets to the status for intended use; the cost of
intangible assets includes the fair value of the debt receivable and any directly attributable expenditure including
taxes for bringing the assets to the status for intended use. The difference between the fair value and the book
value of the debt receivable is included in the current profit and loss.When the debt restructuring causes the Company to convert the debt receivable to an equity investment of joint
ventures or associates the Company shall measure the equity investment based on the sum of the fair value of
debt receivable and any directly attributable taxes and other costs of the investment. The difference between the
fair value and the book value of the debt receivable is included in the current profit and loss.When a debt restructuring involves the modification of other terms of a debt the Company recognises and
measures the restructured debt receivable in accordance with the Accounting Standards for Business Enterprises
No. 22 – Recognition and Measurement of Financial Instruments.When a debt is settled by multiple assets or combination of various methods in a debt restructuring the Company
first recognises and measures the financial assets received and restructured debt receivable in accordance
with the Accounting Standards for Business Enterprises No. 22 – Recognition and Measurement of Financial
Instruments and then allocates the net value which is the fair value of the debt receivable deducted by the
recognised amount of financial assets received and restructured debt receivable to the costs of nonfinancial
assets received based on their relative fair value. The difference between the fair value and the book value of the
debt receivable is included in the current profit and loss.
130 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
39. Critical accounting judgments and estimates
The Company gives continuous assessment on among other things the reasonable expectations of future events and
the critical accounting estimates and key assumptions adopted according to its historical experience and other factors.The critical accounting estimates and key assumptions that are likely to lead to significant adjustment risks of the
carrying amount of assets and liabilities for the next financial year are listed as follows:
Deferred income tax assets
Deferred income tax assets are recognised for all unused tax losses to the extent that it is probable that taxable profit
will be available against which the losses can be utilised. Significant management judgement is required to determine
the amount of deferred income tax assets that can be recognised based upon the likely timing and level of future
taxable profits together with future tax planning strategies.Classification of financial assets
Significant judgements involved in determining the classification of financial assets include the analysis of business
models and contractual cash flow characteristics.Factors considered by the Company in determining the business model for a group of financial assets include how the
asset’s performance is evaluated and reported to key management personnel how risks are assessed and managed
and how the relevant management personnel are compensated.When the Company assesses whether the contractual cash flows of the financial assets are consistent with basic
lending arrangements the main judgements are described as below: whether the principal amount may change over
the life of the financial asset (for example if there are repayments of principal); whether the interest includes only
consideration for the time value of money credit risk other basic lending risks and a profit margin and cost. For
example whether the amount repaid in advance reflects only the outstanding principal and interest thereon as well as
reasonable compensation paid for early termination of the contract.Measurement of the ECLs of accounts receivable
The Company calculates the ECLs of accounts receivable using the exposure to default risk and ECL rate of accounts
receivable and determines the ECL rate based on default probability and default loss rate. When determining the ECL
rate the Company adjusts its historical data by referring to information such as historical credit loss experience as well
as current situation and forward-looking information. When considering the forward-looking information indicators used
by the Company include the risk of economic downturn external market environment technology environment and
changes in customers. The assumptions relating to the ECL calculation are monitored and reviewed by the Company on
a regularly basis.Measurement of past due credit losses on finance lease receivables
The Company calculates the ECLs of financial lease receivables using the exposure to default risk and ECL rate of
financial lease receivables and determines the ECL rate based on default probability and default loss rate. When
determining the ECL rate the Company takes into account the current status and repayment ability of the counterparty
while considering the value of collateral guarantees and other credit enhancement measures related to the lease
receivables.SHANDONG CHENMING PAPER HOLDINGS LIMITED 131
INTERIM REPORT 2025VIII Financial Report
V. Significant Accounting Policies and Accounting Estimates (Cont’d)
39. Critical accounting judgments and estimates (Cont’d)
Deferred income tax assets
Deferred income tax assets are recognised for all unused tax losses to the extent that it is probable that taxable profit
will be available against which the losses can be utilised. Significant management judgement is required to determine
the amount of deferred income tax assets that can be recognised based upon the likely timing and level of future
taxable profits together with future tax planning strategies.Impairment of goodwill
The Company assesses the impairment of goodwill at least annually which requires estimates of the use value of asset
groups allocated with goodwill. When estimating the use value the Company is required to estimate the future cash
flows from such asset groups while selecting the appropriate discount rate to calculate the present value of future cash
flows.Impairment of inventories
On the balance sheet date the Company determines the net realisable value of its inventories based on the estimated
selling prices of the inventories less costs estimated to be incurred upon completion estimated selling expenses and
related taxes. The realisable value of inventories shall be determined on the basis of definite evidence purpose of
holding the inventories and effect of after-balance-sheet-date events. If the net realisable value is below the cost of
inventories a provision for inventory impairment is made.Impairment of fixed assets and long-term equity investments
The Company assesses the impairment of fixed assets and long-term equity investments at least annually. When any
event or change in circumstances indicates that the carrying amount may not be recoverable the carrying amount of
such project is reviewed for impairment. If the carrying amount of an asset exceeds its recoverable amount impairment
loss is recognised for the difference. The recoverable amount is determined as the higher of the asset’s fair value less
costs of disposal and the present value of the asset’s estimated future cash flows. A number of assumptions are made
in estimating the recoverable amount of assets including future cash flows and discount rates relating to non-current
assets. If future events differ from these assumptions the recoverable amount shall be revised which may have an
impact on the operations or financial position of the Company.
40. Changes in significant accounting policies and accounting estimates
(1) Changes in significant accounting policies
□ Applicable √ Not applicable
(2) Changes in significant accounting estimates
□ Applicable √ Not applicable
(3) Adjustments to relevant items at the beginning of the year in the financial statements arising from the first-time
adoption of new accounting standards in 2025
□ Applicable √ Not applicable
132 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VI. Taxation
1. Main tax types and tax rates
Tax type Tax base Tax rate
Value added tax (VAT) VAT payable (VAT payable is calculated 13/9/6
by multiplying taxable sales amount
by the applicable tax rate less current
deductible input VAT)
Property tax Rental income and property price 1.2/12
Urban maintenance and construction tax Actual turnover tax paid 7
Enterprise income tax Taxable income 25
Disclosure of taxable entities subject to different EIT tax rates
Name of taxable entity EIT tax rate
Shandong Chenming Paper Holdings Limited 15
Shouguang Meilun Paper Co. Ltd. 15
Jilin Chenming Paper Co. Ltd. 15
Jiangxi Chenming Paper Co. Ltd. 15
Zhanjiang Chenming Pulp & Paper Co. Ltd. 15
Huanggang Chenming Pulp & Paper Co. Ltd. 15
Shouguang Xinyuan Coal Co. Ltd. 20
Shouguang Chenming Papermaking Machine Co. Ltd. 20
Zhanjiang Chenming Arboriculture Development Co. Ltd. Exempt from EIT
Nanchang Chenming Arboriculture Development Co. Ltd. Exempt from EIT
Chenming Arboriculture Co. Ltd. Exempt from EIT
Yangjiang Chenming Arboriculture Development Co. Ltd. Exempt from EIT
2. Tax incentives
(1) Enterprise income tax
On 7 December 2024 the Company received a high and new technology enterprise certificate with a certification
number of GR202437001530. Pursuant to the requirements under the Law of the People’s Republic of China on
Enterprise Income Tax and the relevant policies the Company is subject to a corporate income tax rate of 15% of
taxable income and is entitled to the preferential treatment from 2024 to 2026.Shouguang Meilun Paper Co. Ltd. a subsidiary of the Company received a high and new technology enterprise
certificate with a certification number of GR202437000114 on 7 December 2024. Pursuant to the requirements
under the Law of the People’s Republic of China on Enterprise Income Tax and the relevant policies Shouguang
Meilun is subject to an enterprise income tax rate of 15% of taxable income and is entitled to the preferential
treatment from 2024 to 2026.SHANDONG CHENMING PAPER HOLDINGS LIMITED 133
INTERIM REPORT 2025VIII Financial Report
VI. Taxation (Cont’d)
2. Tax incentives (Cont’d)
(1) Enterprise income tax (Cont’d)
Jilin Chenming Paper Co. Ltd. a subsidiary of the Company has been handling the renewal procedures for its
high and new technology enterprise certificate during the year as the certificate has expired at the end of 2024.The renewal is expected to be completed in October and Jilin Chenming is still subject to an enterprise income
tax rate of 15% of taxable income for the period.Jiangxi Chenming Paper Co. Ltd. a subsidiary of the Company has been handling the renewal procedures for
its high and new technology enterprise certificate during the year as the certificate has expired at the end of 2024.The renewal is expected to be completed in December and Jiangxi Chenming is still subject to an enterprise
income tax rate of 15% of taxable income for the period.Zhanjiang Chenming Pulp & Paper Co. Ltd. a subsidiary of the Company received a high and new technology
enterprise certificate with a certification number of GR202444002840 on 19 November 2024. Pursuant to the
requirements under the Law of the People’s Republic of China on Enterprise Income Tax and the relevant policies
Zhanjiang Chenming is subject to an enterprise income tax rate of 15% of taxable income and is entitled to the
preferential treatment from 2024 to 2026.Huanggang Chenming Pulp & Paper Co. Ltd. a subsidiary of the Company received a high and new technology
enterprise certificate with a certification number of GR202342003128 on 5 December 2023. Pursuant to the
requirements under the Law of the People’s Republic of China on Enterprise Income Tax and the relevant policies
Huanggang Chenming is subject to an enterprise income tax rate of 15% of taxable income and is entitled to the
preferential treatment from 2023 to 2025.Pursuant to the requirements of Rule 27(1) of Law of the People’s Republic of China on Enterprise Income Tax and
Rule 86(1) of regulations for the Implementation of Law of the People’s Republic of China on Enterprise Income
Tax Zhanjiang Chenming Arboriculture Development Co. Ltd. Yangjiang Chenming Arboriculture Development
Co. Ltd. Nanchang Chenming Arboriculture Development Co. Ltd. and Chenming Arboriculture Co. Ltd. which
are the subsidiaries of the Company have completed the filings for EIT reduction for exemption from EIT.Shouguang Xinyuan Coal Co. Ltd. and Shouguang Chenming Papermaking Machine Co. Ltd. which are
subsidiaries of the Company are small and micro enterprises. Pursuant to the Announcement of the Ministry of
Finance and the State Administration of Taxation on Further Implementation of Preferential Income Tax Policies
for Small and Micro Enterprises (Cai Shui [2022] No. 13) and the Announcement of the Ministry of Finance and the
State Administration of Taxation on the Implementation of Preferential Income Tax Policies for Small and Micro
Enterprises and Individual Industrial and Commercial Business (Cai Shui [2023] No. 6) the annual taxable income
of a small low-profit enterprise that is less than RMB3 million shall be included in its taxable income at a reduced
rate of 25% with the applicable enterprise income tax rate of 20%.
(2) Value-added Tax (“VAT”)
Pursuant to Rule 10 of the Interim Regulation of the People’s Republic of China on Value Added Tax Zhanjiang
Chenming Arboriculture Development Co. Ltd. Yangjiang Chenming Arboriculture Development Co. Ltd.Nanchang Chenming Arboriculture Development Co. Ltd. and Chenming Arboriculture Co. Ltd. which are
subsidiaries of the Company are exempt from VAT and have completed the filings for VAT reduction for
exemption from VAT.
134 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements
1. Monetary funds
Unit: RMB
Item Closing balance Opening balance
Treasury cash 2394083.00 1363319.76
Bank deposit 60585255.05 150579926.55
Other monetary funds 875404665.38 5728747806.12
Interest accrued on deposits 15277493.17 29188759.75
Total 953661496.60 5909879812.18
Including: Total deposits in overseas banks 25556854.12 90613912.87
Other explanations:
* Other monetary funds of RMB202153506.60 were the guarantee deposit for the application for acceptance bills
by the Company of which RMB2153506.60 was locked-up.* Other monetary funds of RMB607004754.05 were the guarantee deposit for the application for letter of credit
with the banks by the Company of which RMB78478176.11 was locked-up.* Other monetary funds of RMB7615777.01 were the guarantee deposit for the application for loans with the banks
by the Company.* Other monetary funds of RMB58630627.72 were locked-up due to reasons such as litigations or being unused
for a long time resulting in restriction on the use of that account’s balance.
2. Financial assets held for trading
Unit: RMB
Item Closing balance Opening balance
Financial assets measured at fair value through profit or loss 36692409.73 37259325.70
Including: Investment in equity instruments 36692409.73 37259325.70
T otal 36692409.73 37259325.70
Other explanation: Financial assets held for trading were shares of China Bohai Bank subscribed by the Company.SHANDONG CHENMING PAPER HOLDINGS LIMITED 135
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
3. Bills receivable
(1) Bills receivable by category
Unit: RMB
Item Closing balance Opening balance
Bank acceptance bills 765000567.09
Commercial acceptance bills 506605701.74
T otal 765000567.09 506605701.74
(2) Disclosure by bad debt provision method
Unit: RMB
Closing balance Opening balance
Book balance Bad debts provision Book balance Bad debts provision
Provision Provision
Category Amount Percentage Amount percentage Book value Amount Percentage Amount percentage Book value
Bills receivable assessed collectively
for bad debt provision 765000567.09 100.00% 765000567.09 506605701.74 100.00% 506605701.74
Including:
Bank acceptance bills 765000567.09 100.00% 765000567.09
Commercial acceptance bills 506605701.74 100.00% 506605701.74
T otal 765000567.09 100.00% 765000567.09 506605701.74 100.00% 506605701.74
Name of category being assessed collectively for bad debt provision: Bank acceptance bills
Unit: RMB
Closing balance
Bad debts Provision
Name Book balance provision percentage
B ank acceptance bills 765000567.09
Total 765000567.09
Whether the bad debts provision for bills receivable is made according to the general model of ECLs:
□ Applicable √ Not applicable
136 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
3. Bills receivable (Cont’d)
(3) Bills receivable endorsed or discounted by the Company but not yet due as at the balance sheet date
Unit: RMB
Amount Amount not yet
derecognised as derecognised as
at the end at the end
Item of the period of the period
Bank acceptance bills 746520575.24
T otal 746520575.24
4. Accounts receivable
(1) Disclosure by ageing
Unit: RMB
Closing book Opening book
Ageing balance balance
Within 1 year (including 1 year) 639549718.94 929046115.66
1 to 2 years 132077444.26 274913099.67
2 to 3 years 367993588.74 352196765.13
Over 3 years 1132302980.26 1112205999.57
Subtotal 2271923732.20 2668361980.03
Less: Bad debts provision 1341192229.68 1284071666.33
Total 930731502.52 1384290313.70
The basis used by the ageing analysis of the accounts receivable of the Company: the ageing of accounts
receivable is the length of time of the Company’s outstanding accounts receivable based on invoice date. The
closing balance is recognised one by one from the end of the period onwards until the amounts add up to the
balance. It is also broken up by intervals of within 1 year 1-2 years 2-3 years and over 3 years.SHANDONG CHENMING PAPER HOLDINGS LIMITED 137
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
4. Accounts receivable (Cont’d)
(2) Disclosure by bad debt provision method
Unit: RMB
Closing balance Opening balance
Book balance Bad debts provision Book balance Bad debts provision
Provision Provision
Percentage percentage Percentage percentage
Category Amount (%) Amount (%) Book value Amount (%) Amount (%) Book value
Accounts receivable assessed
individually for bad debt provision 305821462.34 13.46 305821462.34 100.00 252399157.18 9.46 244457449.18 96.85 7941708.00
Accounts receivable assessed
collectively for bad debt provision 1966102269.86 86.54 1035370767.34 52.66 930731502.52 2415962822.85 90.54 1039614217.15 43.03 1376348605.70
Including:
Due from related parties 2981407.22 0.13 144501.82 4.85 2836905.40 1945551.12 0.07 13618.86 0.70 1931932.26
Due from non-related parties 826104360.78 36.36 110171373.40 13.34 715932987.38 1153594000.22 43.23 126192125.69 10.94 1027401874.53
Factoring receivables 1137016501.86 50.05 925054892.12 81.36 211961609.74 1260423271.51 47.24 913408472.60 72.47 347014798.91
T otal 2271923732.20 100.00 1341192229.68 59.03 930731502.52 2668361980.03 100.00 1284071666.33 48.12 1384290313.70
Items assessed individually for bad debt provision:
Unit: RMB
Opening balance Closing balance
Provision
Bad debts Bad debts percentage
Name Book balance provision Book balance provision (%) Provision reason
Foshan Shunde Xingchen
Paper Co. Ltd. 26697528.70 26697528.70 26697528.70 26697528.70 100.00 Long outstanding
Shandong Bisheng
Printing Materials Co.Ltd. 14813369.27 14813369.27 14813369.27 14813369.27 100.00 Long outstanding
Zhengzhou Hongyang
Paper Products Co.Ltd. 14453432.93 14453432.93 14453432.93 14453432.93 100.00 Long outstanding
Henan Yibang
Technology
Trading Co. Ltd. 13396601.22 13396601.22 13396601.22 13396601.22 100.00 Long outstanding
Changsha Chuangyi
Paper Co. Ltd. 10954285.12 10954285.12 10954285.12 10954285.12 100.00 Long outstanding
Shandong Yiming New
Material Technology
Corp Co. Ltd. 10624137.64 10624137.64 10624137.64 10624137.64 100.00 Long outstanding
Hunan Jinbeishun Paper
Co. Ltd. 10614691.35 10614691.35 10614691.35 10614691.35 100.00 Long outstanding
Fuzhou Fulan Trading
Co. Ltd. 10250525.02 10250525.02 10250525.02 10250525.02 100.00 Long outstanding
Beijing Zhonghe Qixiang
Pulp and Paper Co.Ltd. 9774000.00 9774000.00 9774000.00 9774000.00 100.00 Long outstanding
67 companies including
Wuhan Tianrui Paper
Co. Ltd. 130820585.93 122878877.93 184242891.09 184242891.09 100.00 Long outstanding
Total 252399157.18 244457449.18 305821462.34 305821462.34 100.00
138 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
4. Accounts receivable (Cont’d)
(2) Disclosure by bad debt provision method (Cont’d)
Number of categories being assessed collectively for bad debt provision: 3
Name of category being assessed collectively for bad debt provision: Due from related parties
Unit: RMB
Closing balance
Bad debts Provision
Name Book balance provision percentage (%)
W ithin 1 year 2981407.22 144501.82 4.85
T otal 2981407.22 144501.82 4.85
Name of category being assessed collectively for bad debt provision: Due from non-related parties
Unit: RMB
Closing balance
Bad debts Provision
N ame Book balance provision percentage (%)
Within 1 year 636568311.72 11434276.45 1.80
1 to 2 years 124450047.00 37463132.65 30.10
2 to 3 years 3984086.01 2077527.32 52.15
Over 3 years 61101916.05 59196436.98 96.88
T otal 826104360.78 110171373.40 13.34
Name of category being assessed collectively for bad debt provision: Factoring receivables
Unit: RMB
Closing balance
Bad debts Provision
N ame Book balance provision percentage (%)
Within 1 year
1 to 2 years 7627397.26 3813698.63 50.00
2 to 3 years 364009502.73 273763164.02 75.21
Over 3 years 765379601.87 647478029.47 84.60
Total 1137016501.86 925054892.12 81.36
Whether the bad debts provision for accounts receivable is made according to the general model of ECLs:
□ Applicable √ Not applicable
SHANDONG CHENMING PAPER HOLDINGS LIMITED 139
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
4. Accounts receivable (Cont’d)
(3) Provision recovery or reversal of bad debt provision for the period
Bad debt provision for the period:
Unit: RMB
Changes in the period
Recovery
Category O pening balance Provision or reversal Written-off Others Closing balance
Bad debts provision 1284071666.33 69712665.33 12591918.13 -183.85 1341192229.68
T otal 1 284071666.33 69712665.33 12591918.13 -183.85 1 341192229.68
Explanation: “Others” includes a decrease in bad debts of RMB183.85 due to changes in exchange rates.
(4) Top five accounts receivable based on closing balance of debtors
The total amount of top five accounts receivable and contract assets based on closing balance of debtors for
the period amounted to RMB1035936190.50 in total accounting for 45.60% of the total closing balance of
accounts receivable and contract assets. The closing balance of the corresponding bad debt provision amounted
to RMB839139731.30 in total.Unit: RMB
As a percentage Closing balance
of the closing of bad debt
Closing balance balance of the provision of
of accounts total accounts accounts
Name of entity receivable receivable (%) receivable
Customer 1 481810233.33 21.21 404720595.99
Customer 2 222656666.64 9.80 191484733.29
Customer 3 121908333.33 5.37 103622083.31
Customer 4 108000000.00 4.75 54000000.00
Customer 5 101560957.20 4.47 85312318.71
T otal 1035936190.50 45.60 839139731.30
140 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
5. Accounts receivable financing
(1) Accounts receivable financing by category
Unit: RMB
Item Closing balance Opening balance
Bank acceptance bills 92166113.62 100730797.32
Total 92166113.62 100730797.32
Explanation: All the accounts receivable financing of the Company were bank acceptance bills. Since the terms
of the bank acceptance bills did not exceed one year and both parties to the endorsement of the bills agreed to
offset equal amounts of accounts receivable and payable based on the face value of the bills fair value equalled
amortised cost.Certain subsidiaries of the Company discount and endorse part of the bank acceptance bills based on their daily
capital management needs. Therefore the bank acceptance bills of the subsidiaries are classified as financial
assets measured at fair value through other comprehensive income.The Company has no bank acceptance bill assessed individually for impairment provision. At the end of the
period the Company believed that there was no significant credit risk in the bank acceptance bills held and no
major losses would be incurred due to default of banks.
(2) Disclosure by bad debt provision method
Unit: RMB
Closing balance Opening balance
Book balance Bad debts provision Book balance Bad debts provision
Provision Provision
Category Amount Percentage Amount percentage Book value Amount Percentage Amount percentage Book value
Items assessed collectively for
bad debt provision 92166113.62 100.00% 92166113.62 100730797.32 100.00% 100730797.32
Including:
Bank acceptance bills 92166113.62 100.00% 92166113.62 100730797.32 100.00% 100730797.32
Total 92166113.62 100.00% 92166113.62 100730797.32 100.00% 100730797.32
Name of category being assessed collectively for bad debt provision: Bank acceptance bills
Unit: RMB
Closing balance
Bad debts Provision
Name Book balance provision percentage
Bank acceptance bills 92166113.62
Total 92166113.62
SHANDONG CHENMING PAPER HOLDINGS LIMITED 141
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
5. Accounts receivable financing (Cont’d)
(3) Accounts receivable financing endorsed or discounted but not yet due as at the balance sheet date
Unit: RMB
Amount Amount not yet
derecognised as derecognised as
at the end at the end
Item of the period of the period
Bank acceptance bills 616041951.77
T otal 616041951.77
Explanation: The credit risk and deferred payment risk of bank acceptance bills used for discounting were very
small and the interest rate risk related to the bills had been transferred to the banks. It was determined that the
major risks and rewards of the ownership of the bills had been transferred so these bills were derecognised.
6. Other receivables
Unit: RMB
Item Closing balance Opening balance
Dividend receivable 22659149.81
Other receivables 826493097.36 1061992721.13
Total 826493097.36 1084651870.94
(1) Dividend receivable
1) Classification of dividends receivable
Unit: RMB
Item (or investee) Closing balance Opening balance
Weifang Chenchuang Equity Investment Fund Partnership
(Limited Partnership) 22659149.81
Total 22659149.81
142 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
6. Other receivables (Cont’d)
(2) Other receivables
1) Classification of other receivables by nature
Unit: RMB
Closing book Opening book
Nature balance balance
Open credit 2465026126.24 2522792110.64
Guarantee deposit and deposit 18719780.93 14874445.09
Reserve and borrowings 13597076.99 16114760.18
Others 8676751.74 7975085.22
Subtotal 2506019735.90 2561756401.13
Bad debts provision 1679526638.54 1499763680.00
T otal 826493097.36 1061992721.13
2) Disclosure by ageing
Unit: RMB
Closing book Opening book
Ageing balance balance
Within 1 year (including 1 year) 535306086.74 680590285.93
1 to 2 years 492014742.91 409320986.47
2 to 3 years 156121767.11 198957834.50
Over 3 years 1322577139.14 1272887294.23
Subtotal 2506019735.90 2561756401.13
Bad debts provision 1679526638.54 1499763680.00
T otal 826493097.36 1061992721.13
The basis used by the ageing analysis: the ageing of other receivables is the length of time of the Company’s
outstanding other receivables based on invoice date. The closing balance is recognised one by one from the
end of the period onwards until the amounts add up to the balance. It is also broken up by intervals of within
1 year 1-2 years 2-3 years and over 3 years.
SHANDONG CHENMING PAPER HOLDINGS LIMITED 143
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
6. Other receivables (Cont’d)
(2) Other receivables (Cont’d)
3) Disclosure by bad debt provision method
Unit: RMB
Closing balance Opening balance
Book balance Bad debts provision Book balance Bad debts provision
Provision Provision
Percentage percentage Percentage percentage
Category Amount (%) Amount (%) Book value Amount (%) Amount (%) Book value
Items assessed individually for
bad debt provision 2078583512.27 82.94 1583495204.60 76.18 495088307.67 2087431689.32 81.48 1443275872.97 69.14 644155816.35
Items assessed collectively for
bad debt provision 427436223.63 17.06 96031433.94 22.47 331404789.69 474324711.81 18.52 56487807.03 11.91 417836904.78
Including:
Amount due from government
agencies 8577167.51 0.34 830183.87 9.68 7746983.64 8929150.60 0.35 736883.39 8.25 8192267.21
Amount due from related
parties 270892618.99 10.81 62260922.61 22.98 208631696.38 328692310.16 12.83 31260068.90 9.51 297432241.26
Other receivables 147966437.13 5.91 32940327.46 22.26 115026109.67 136703251.05 5.34 24490854.74 17.92 112212396.31
Total 2506019735.90 100.00 1679526638.54 67.02 826493097.36 2561756401.13 100.00 1499763680.00 58.54 1061992721.13
Items assessed individually for bad debt provision:
Unit: RMB
Opening balance Closing balance
Provision
Bad debts Bad debts percentage
Name Book balance provision Book balance provision (%) Reason
Customer 1 472854783.56 332202672.36 472854783.56 342452672.36 72.42 Uncertain recovery to
a certain extent
Customer 2 453002316.85 181200926.74 453002316.85 231031181.59 51.00 Uncertain recovery to
a certain extent
Customer 3 390000000.00 390000000.00 390000000.00 390000000.00 100.00 Uncertain recovery to
a certain extent
Customer 4 143940305.63 79167168.10 132386694.51 81928289.77 61.89 Uncertain recovery to
a certain extent
146 customers including 627634283.28 460705105.77 630339717.35 538083060.88 85.36 Uncertain recovery to
customer 5 a certain extent
Total 2087431689.32 1443275872.97 2078583512.27 1583495204.60 76.18
144 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
6. Other receivables (Cont’d)
(2) Other receivables (Cont’d)
3) Disclosure by bad debt provision method (Cont’d)
Bad debt provision based on the general model of ECLs:
Unit: RMB
Stage 1 Stage 2 Stage 3
Lifetime ECLs Lifetime ECLs
ECLs for the (not credit- (credit-
Bad debts provision next 12 months impaired) impaired) Total
Balance as at 1 January 2025 56487807.03 1443275872.97 1499763680.00
Balance as at 1 January 2025 for
the period
– Transferred to stage 2
– Transferred to stage 3
– Reversed to stage 2
– Reversed to stage 1
Provision for the period 45191586.82 143482541.72 188674128.54
Reversal for the period 5647544.72 3263210.09 8910754.81
Transfer for the period
Write-off for the period
Other changes -415.19 -415.19
Balance as at 30 June 2025 96031433.94 1583495204.60 1679526638.54
Explanation: Others changes were due to changes in exchange rates.Changes in carrying book balances with significant changes in loss provision for the period
□ Applicable √ Not applicable
4) Provision recovery or reversal of bad debt provision for the period
Bad debt provision for the period:
Unit: RMB
Changes in the period
Opening Recovery Transfer or
Category balance Provision or reversal write-off Others Closing balance
Other receivables 1499763680.00 188674128.54 8910754.81 -415.19 1679526638.54
T otal 1499763680.00 188674128.54 8910754.81 -415.19 1679526638.54
SHANDONG CHENMING PAPER HOLDINGS LIMITED 145
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
6. Other receivables (Cont’d)
(2) Other receivables (Cont’d)
5) Top five other receivables according to closing balance of debtors
The total amount of the Company’s top five other receivables based on closing balance of debtors for the
period was RMB1626215128.58 which accounted for 64.89% of the closing balance of the total other
receivables. The closing balance of corresponding bad debt provision amounted to RMB1057584866.14.Unit: RMB
As a percentage
of the closing Closing balance
balance of total of bad debt
Name of entity Nature Closing balance Ageing other receivables (%) provision
Customer 1 Consideration for debt transfer 472854783.56 4 to 5 years 18.87 342452672.36
Customer 2 Consideration for debt transfer 453002316.85 Over 5 years 18.08 231031181.59
Customer 3 Consideration for debt transfer 390000000.00 1 to 2 years 15.56 390000000.00
Customer 4 Financial support 177971333.66 1 to 2 years 7.10 12172722.42
Customer 5 Consideration for debt transfer 132386694.51 3 to 4 years 5.28 81928289.77
Total 1626215128.58 64.89 1057584866.14
146 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
7. Prepayments
(1) Prepayments by ageing
Unit: RMB
Closing balance Opening balance
Ageing Amount Percentage Amount Percentage
Within 1 year 467197487.32 90.77% 592705315.78 93.80%
1 to 2 years 47514537.04 9.23% 39188179.36 6.20%
Total 514712024.36 100% 631893495.14 100%
(2) Top five prepayments based on closing balance of prepaid parties
The total amount of top five prepayments based on closing balance of prepaid parties for the period amounted to
RMB224396113.86 accounting for 43.60% of the closing balance of the total prepayments.Unit: RMB
As a percentage
of the closing
Closing balance balance of the
Name of entity of prepayments total prepayments
Customer 1 55668669.56 10.82%
Customer 2 55059195.61 10.70%
Customer 3 52234915.42 10.15%
Customer 4 32672877.26 6.35%
Customer 5 28760456.01 5.58%
Total 224396113.86 43.60%
SHANDONG CHENMING PAPER HOLDINGS LIMITED 147
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
8. Inventories
(1) Categories of inventories
Unit: RMB
Closing balance Opening balance
Impairment Impairment
provision for provision for
inventories or inventories or
performance performance
I tem Book balance costs Book value Book balance costs Book value
Raw materials 1248246294.74 17216467.87 1231029826.87 1225049193.59 15709012.21 1209340181.38
Work-in-process products 24207338.19 24207338.19 121749898.40 121749898.40
Goods in stock 173137316.50 4836695.44 168300621.06 269949625.20 22030676.68 247918948.52
Consumable biological assets 1098778602.31 1098778602.31 1256379773.85 1256379773.85
Total 2544369551.74 22053163.31 2522316388.43 2873128491.04 37739688.89 2835388802.15
Note: Consumable biological assets are forestry assets.
(2) Impairment provision for inventories and performance costs
Unit: RMB
Increase during the period Decrease during the period
Opening Reversal or
I tem balance Provision Others transfer Others Closing balance
Raw materials 15709012.21 1507455.66 17216467.87
Goods in stock 22030676.68 1885491.46 19079472.70 4836695.44
Total 37739688.89 3392947.12 19079472.70 22053163.31
Basis for recognition of net realisable Reason for reversal or written-off of
value/residual consideration impairment provision for inventories/
Item with future cost performance costs during the period
Raw materials The cost of raw materials is higher than Written-off of impairment provision for
their net realisable value inventories due to sales of impaired spare
parts during the period
Goods in stock The cost of goods in stock is higher than Written-off of impairment provision for
their net realisable value inventories due to sales of impaired goods
in stock during the period
148 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
9. Non-current assets due within one year
Unit: RMB
Item Closing balance Opening balance
Long-term receivables due within one year 2393909142.54 2840365519.48
T otal 2393909142.54 2840365519.48
Explanations: * Long-term receivables due within one year amounting to RMB2391130169.10 (opening balance:
RMB2816898675.87) were financial lease receivables; * Long-term receivables due within one year amounting to
RMB2410508.72 (opening balance: RMB23098378.89) were deposits receivable; * Long-term receivables due within
one year amounting to RMB368464.72 (opening balance: RMB368464.72) were sublease receivables.
(1) Particulars of impairment provision
Unit: RMB
Stage 1 Stage 2 Stage 3
Lifetime ECLs
ECLs for the (not credit- Lifetime ECLs
Bad debts provision next 12 months impaired) (credit-impaired) Total
Balance as at 1 January 2025 2027393033.65 2027393033.65
Balance as at 1 January 2025 for the period
– Transferred to stage 2
– Transferred to stage 3
– Reversed to stage 2
– Reversed to stage 1
Provision for the period 213443651.30 213443651.30
Reversal for the period 8045202.50 8045202.50
Transfer for the period
Write-off for the period
Other changes 2133065.18 2133065.18
Balance as at 30 June 2025 2234924547.63 2234924547.63
Explanation: Other changes were the transfer from long-term receivables due within one year.SHANDONG CHENMING PAPER HOLDINGS LIMITED 149
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
10. Other current assets
Unit: RMB
Item Closing balance Opening balance
Input tax amount to be deducted 125760593.77 135623629.69
Prepaid tax 7602012.64 7659808.66
Receivables under financial lease due within one year 95991375.59 182672726.43
Factoring receivables due within one year 33669153.22 74820340.44
Prepaid expenses 71769098.81 144335745.61
Other payments 2798952.00 14798952.00
Total 337591186.03 559911202.83
11. Long-term receivables
(1) Particulars of long-term receivables
Unit: RMB
Closing balance Opening balance Discount
I tem Book balance Bad debts provision Book value Book balance Bad debts provision Book value rate range
Finance lease payments 4864577431.35 2246850683.36 2617726747.99 5125475727.85 2041452234.56 3084023493.29 4%-12%
Including: Unrealised financing income 121818319.83 121818319.83 121865194.82 121865194.82
Deposit for finance lease 152712158.53 152712158.53 221956391.53 221956391.53
Including: Unrealised financing income 21751140.83 21751140.83 25782566.94 25782566.94
Sublease receivable for woodland 13879744.10 899519.98 12980224.12 11987400.88 899519.98 11087880.90
Including: Unrealised financing income 6587234.26 6587234.26 6803007.48 6803007.48
Less: Long-term receivables due within
one year 4628833690.17 2234924547.63 2393909142.54 4867758553.13 2027393033.65 2840365519.48
Less: Other current liabilities 4393344.27 4393344.27 196410443.69 196410443.69
Total 397942299.54 12825655.71 385116643.83 295250523.44 14958720.89 280291802.55
150 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
11. Long-term receivables (Cont’d)
(2) Disclosure by bad debt provision method
Unit: RMB
Closing balance Opening balance
Book balance Bad debts provision Book balance Bad debts provision
Provision Provision
Category Amount Percentage Amount percentage Book value Amount Percentage Amount percentage Book value
Items assessed individually for
bad debt provision
Items assessed collectively for
bad debt provision 397942299.54 100.00% 12825655.71 3.22% 385116643.83 295250523.44 100.00% 14958720.89 5.07% 280291802.55
Including:
Receivables not past due 238522714.62 59.94% 11926135.73 5.00% 226596578.89 281184018.32 95.24% 14059200.91 5.00% 267124817.41
Sublease receivable for
woodland 13511279.38 3.40% 899519.98 6.66% 12611759.40 11618936.16 3.93% 899519.98 7.74% 10719416.18
Deposits receivable 145908305.54 36.66% 145908305.54 2447568.96 0.83% 2447568.96
Total 397942299.54 100.00% 12825655.71 3.22% 385116643.83 295250523.44 100.00% 14958720.89 5.07% 280291802.55
Number of categories being assessed collectively for bad debt provision: 3
Name of category being assessed collectively for bad debt provision: Receivables not past due
Unit: RMB
Closing balance
Bad debts Provision
N ame Book balance provision percentage
Within 1 year
1 to 2 years 85169767.94 4258488.39 5.00%
2 to 3 years 85169767.94 4258488.40 5.00%
Over 3 years 68183178.74 3409158.94 5.00%
Total 238522714.62 11926135.73 5.00%
SHANDONG CHENMING PAPER HOLDINGS LIMITED 151
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
11. Long-term receivables (Cont’d)
(2) Disclosure by bad debt provision method (Cont’d)
Name of category being assessed collectively for bad debt provision: Sublease receivable for woodland
Unit: RMB
Closing balance
Bad debts Provision
N ame Book balance provision percentage
1 to 2 years 395471.70 6735.50 1.70%
2 to 3 years 409708.69 15179.23 3.70%
3 to 4 years 894458.20 49500.56 5.53%
4 to 5 years 535758.69 35500.56 6.63%
Over 5 years 11275882.10 792604.13 7.03%
T otal 13511279.38 899519.98 6.66%
Name of category being assessed collectively for bad debt provision: Deposits receivable
Unit: RMB
Closing balance
Bad debts Provision
Name Book balance provision percentage
Within 1 year
1 to 2 years 24643396.41
2 to 3 years 29483088.87
Over 3 years 91781820.26
T otal 145908305.54
152 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
11. Long-term receivables (Cont’d)
(2) Disclosure by bad debt provision method (Cont’d)
Bad debt provision based on the general model of ECLs
Unit: RMB
Stage 1 Stage 2 Stage 3
Lifetime ECLs Lifetime ECLs
ECLs for the (not credit- (credit-
Bad debts provision next 12 months impaired) impaired) Total
Balance as at 1 January 2025 14958720.89 14958720.89
Balance as at 1 January 2025 for the
period
– Transferred to stage 2
– Transferred to stage 3
– Reversed to stage 2
– Reversed to stage 1
Provision for the period
Reversal for the period
Transfer for the period
Write-off for the period
Non-current assets classified
as due within one year -2133065.18 -2133065.18
Balance as at 30 June 2025 12825655.71 12825655.71
Other explanation: Other changes in the period was the amount of bad debt provision reclassified to non-current
assets due within one year.
(3) Provision recovery or reversal of bad debt provision for the period
Unit: RMB
Changes in the period
Opening Recovery or Transfer or Closing
Category balance Provision reversal write-off Others balance
Bad debts provision 14958720.89 -2133065.18 12825655.71
Total 1 4958720.89 - 2133065.18 12825655.71
Other explanation: Other changes in the period was the amount of bad debt provision reclassified to non-current
assets due within one year.SHANDONG CHENMING PAPER HOLDINGS LIMITED 153
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
12. Long-term equity investments
Unit: RMB
Change for the period
Investment Distribution
Opening Opening gain or loss Adjustment Other of cash
balance balance of recognised of other change dividend Closing balance
(carrying impairment Additional Withdrawn under equity comprehensive in equity or profit Impairment Closing balance of impairment
Investee amount) provision contribution contribution method income interest declared provision Others (carrying amount) provision
I. Joint ventures
Shouguang Chenming
Huisen New-style
Construction Materials
Co. Ltd. 8368935.72 -454469.59 7914466.13
Weifang Port Wood Chip
Wharf Co. Ltd. 87317015.51 -10425862.90 76891152.61
Shouguang Meite
Environmental
Technology Co. Ltd. 17960215.27 -2469832.94 15490382.33
Shouguang Jintou
Industrial Investment
Partnership (Limited
Partnership) 1779091176.56 -335442177.93 1443648998.63
Weifang Xingxing United
Chemical Co. Ltd. 78795494.34 13078890.78 78795494.34 13078890.78
Subtotal 1971532837.40 13078890.78 -348792343.36 1622740494.04 13078890.78
154 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
12. Long-term equity investments (Cont’d)
Change for the period
Investment Distribution
Opening Opening gain or loss Adjustment Other of cash
balance balance of recognised of other change dividend Closing balance
(carrying impairment Additional Withdrawn under equity comprehensive in equity or profit Impairment Closing balance of impairment
Investee amount) provision contribution contribution method income interest declared provision Others (carrying amount) provision
II. Associates
Zhuhai Dechen New
Third Board Equity
Investment Fund
Company (Limited
Partnership) 27167682.31 -3636926.80 23530755.51
Ningbo Kaichen Huamei
Equity Investment
Fund Partnership
(Limited Partnership) 135554820.00 8867943.33 144422763.33
Nanchang Tianchen
Port Co. Ltd. 56995531.95 499339.14 57494871.09
Goldtrust Futures
Co. Ltd. 194450748.14 4010000.00 -702243.82 193748504.32 4010000.00
Xuchang Chenming
Paper Co. Ltd. 5994545.96 5994545.96
Chenming (Qingdao)
Asset Management
Co. Ltd. 826793.21 245037.23 1071830.44
Wuhan Chenming
Hanyang Paper
Holdings Co. Ltd. 229854588.36 -13761303.43 216093284.93
Guangdong Nanyue
Bank Co. Ltd. 1354652410.17 11305977.21 -3795486.93 1362162900.45
Subtotal 1999502574.14 10004545.96 2817822.86 -3795486.93 1998524910.07 10004545.96
Total 3971035411.54 23083436.74 -345974520.50 -3795486.93 3621265404.11 23083436.74
Determination of net amount of recoverable amount measured at fair value after deducting disposal expenses
□ Applicable √ Not applicable
Determination of present value of recoverable amount based on expected cash flows
□ Applicable √ Not applicable
SHANDONG CHENMING PAPER HOLDINGS LIMITED 155
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
13. Other non-current financial assets
Unit: RMB
Item Closing balance Opening balance
Investment in debt instruments 243238260.24 650001725.86
Investment in equity instruments 101028728.82 101028728.82
T otal 344266989.06 751030454.68
14. Investment property
(1) Investment property under the cost method
√ Applicable □ Not applicable
Unit: RMB
Housing and
Item building structure Total
I. Original carrying amount
1. Opening balance 7134063378.49 7134063378.49
2. Increase during the period
3. Decrease during the period 172061891.55 172061891.55
(1) Disposal 172061891.55 172061891.55
4. Closing balance 6962001486.94 6962001486.94
II. Accumulated depreciation and accumulated amortisation
1. Opening balance 1288600119.94 1288600119.94
2. Increase during the period 93700162.32 93700162.32
(1) Provision or amortisation 93700162.32 93700162.32
3. Decrease during the period 25444088.71 25444088.71
(1) Disposal 25444088.71 25444088.71
4. Closing balance 1356856193.55 1356856193.55
III. Impairment provision
1. Opening balance 102227990.09 102227990.09
3. Decrease during the period
4. Closing balance 102227990.09 102227990.09
IV. Carrying amount
1. Closing carrying amount 5502917303.30 5502917303.30
2. Opening carrying amount 5743235268.46 5743235268.46
156 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
14. Investment property (Cont’d)
(1) Investment property under the cost method (Cont’d)
Determination of net amount of recoverable amount measured at fair value after deducting disposal expenses
□ Applicable √ Not applicable
Determination of present value of recoverable amount based on expected cash flows
□ Applicable √ Not applicable
(2) Investment property under the fair value method
□ Applicable √ Not applicable
(3) Particulars of investment property without obtaining property right certificates
The Company has no investment property without obtaining property right certificates.SHANDONG CHENMING PAPER HOLDINGS LIMITED 157
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
15. Fixed assets
Unit: RMB
Item Closing balance Opening balance
Fixed assets 30486711545.01 31855069324.04
T otal 30486711545.01 31855069324.04
(1) Particulars of fixed assets
Unit: RMB
Electronic
Housing and Machinery and Transportation equipment
Item building structure equipment equipment and others Total
I. Original carrying amount:
1. Opening balance 11820547859.70 43724325201.35 268370299.02 380586884.62 56193830244.69
2. Increase during the period 3519067.63 13893984.63 824297.11 708050.10 18945399.47
(1) Acquisition 366639.40 13893984.63 824297.11 708050.10 15792971.24
(2) Transferred from construction
in progress 3152428.23 3152428.23
3. Decrease during the period 86483738.19 20305914.20 21163651.77 3102781.44 131056085.60
(1) Disposal or retirement 86483738.19 20305914.20 16534934.24 3053002.98 126377589.61
(2) Disposal of subsidiaries 4628717.53 49778.46 4678495.99
4. Closing balance 11737583189.14 43717913271.78 248030944.36 378192153.28 56081719558.56
II. Accumulated depreciation
1. Opening balance 2900330968.52 20704110792.91 214213548.69 254658460.96 24073313771.08
2. Increase during the period 149308626.95 899533388.11 5337671.50 2313287.28 1056492973.84
(1) Provision 149308626.95 899533388.11 5337671.50 2313287.28 1056492973.84
3. Decrease during the period 3483829.38 12833169.37 18322997.74 2774346.65 37414343.14
(1) Disposal or retirement 3483829.38 12833169.37 13947739.59 2727057.27 32991795.61
(2) Disposal of subsidiaries 4375258.15 47289.38 4422547.53
4. Closing balance 3046155766.09 21590811011.65 201228222.45 254197401.59 25092392401.78
III. Impairment provision
1. Opening balance 65307038.71 192690987.81 13889.13 7435233.92 265447149.57
2. Increase during the period 237168462.20 237168462.20
(1) Provision 237168462.20 237168462.20
3. Decrease during the period
4. Closing balance 65307038.71 429859450.01 13889.13 7435233.92 502615611.77
IV. Carrying amount
1. Closing carrying amount 8626120384.34 21697242810.12 46788832.78 116559517.77 30486711545.01
2. Opening carrying amount 8854909852.47 22827523420.63 54142861.20 118493189.74 31855069324.04
158 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
15. Fixed assets (Cont’d)
(2) Particulars of temporarily idle fixed assets
Unit: RMB
Original
carrying Accumulated Impairment
Item amount depreciation provision Book value Remark
Housing and building structure 136913541.04 70464646.73 3093008.64 63355885.67
Machinery and equipment 2073161016.01 1098296512.02 419107140.97 555757363.02
Electronic equipment and others 3886693.69 3420090.81 252222.32 214380.56
Total 2213961250.74 1172181249.56 422452371.93 619327629.25
(3) Particulars of fixed assets without obtaining property right certificates
Unit: RMB
Reason for not yet
obtaining property
Item Book value right certificates
Housing and building structure
(Chongmin Culture Development (Shanghai) Co. Ltd.) 1132405721.27 Under application
Housing and building structure
(Zhanjiang Chenming Pulp & Paper Co. Ltd.) 939966260.01 Under application
Housing and building structure (Shouguang Meilun Paper Co. Ltd.) 460931745.40 Under application
Housing and building structure (Jilin Chenming Paper Co. Ltd.) 346556632.69 Under application
Housing and building structure (Jiangxi Chenming Paper Co. Ltd.) 186368143.00 Under application
Housing and building structure
(Shandong Chenming Paper Holdings Limited) 132600962.45 Under application
Housing and building structure
(Huanggang Chenming Pulp & Paper Co. Ltd.) 22551381.97 Under application
Total 3221380846.79
SHANDONG CHENMING PAPER HOLDINGS LIMITED 159
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
15. Fixed assets (Cont’d)
(4) Impairment test on fixed assets
√ Applicable □ Not applicable
Determination of net amount of recoverable amount measured at fair value after deducting disposal expenses
√ Applicable □ Not applicable
Unit: RMB
Determination of
fair value Basis of
and disposal determination of
Item Carrying amount Book value Impairment expenses Key parameter key parameter
Machinery and equipment 549413196.02 312244733.82 237168462.20 Market Inquiry N/A N/A
Total 549413196.02 312244733.82 237168462.20
Determination of present value of recoverable amount based on expected cash flows
□ Applicable √ Not applicable
16. Construction in progress
Unit: RMB
Item Closing balance Opening balance
Construction in progress 604010416.63 586611718.04
Materials for project 6860479.90 7226885.83
Total 610870896.53 593838603.87
160 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
16. Construction in progress (Cont’d)
(1) Particulars of construction in progress
Unit: RMB
Closing balance Opening balance
Book Impairment Book Impairment
Item balance provision Book value balance provision Book value
Relocation of Wuhan 4800
papermaking machine
project (Zhanjiang
Chenming) 556727044.76 86712411.44 470014633.32 549063751.76 86712411.44 462351340.32
Technological transformation
project 137410068.03 11645893.36 125764174.67 129380245.56 11645893.36 117734352.20
300000 tonnes softwood
pulp project
(Shandong Chenming) 13384376.59 6177296.25 7207080.34 12703321.77 6177296.25 6526025.52
Others 24672634.03 23648105.73 1024528.30 23648105.73 23648105.73
Total 732194123.41 128183706.78 604010416.63 714795424.82 128183706.78 586611718.04
(2) Changes in material construction in progress projects for the period
Unit: RMB
Including:
Capitalised Capitalisation
Transfer to Other interest rate of the
fixed asset deductions Accumulated Accumulated amount interest
Opening Increase during during the during Closing investment Construction capitalised during amount during
Item Budget balance the period period the period balance to budget (%) progress (%) interest the period the period Source of fund
Relocation of Wuhan
4800 papermaking
machine project
(Zhanjiang Self-owned funds
Chenming) 800000000.00 549063751.76 7663293.00 556727044.76 69.59 71.00 and borrowings
300000 tonnes
softwood
pulp project
(Shandong Self-owned funds
Chenming) 1488980000.00 12703321.77 681054.82 13384376.59 0.90 0.70 and borrowings
T otal 2288980000.00 561767073.53 8344347.82 5 70111421.35 － － －
SHANDONG CHENMING PAPER HOLDINGS LIMITED 161
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
16. Construction in progress (Cont’d)
(3) Impairment provision for construction in progress for the period
Unit: RMB
Increase Decrease
Opening during during Closing Reason for
Item balance the period the period balance provision
Relocation of Wuhan 4800 papermaking
machine project (Zhanjiang Chenming) 86712411.44 86712411.44
Differentiated viscose fibre and spinning and
chemical project (Huanggang Pulp & Paper) 12609724.89 12609724.89
300000 tonnes softwood pulp project
(Shandong Chenming) 6177296.25 6177296.25
Closed deodorisation at wastewater
treatment plant (Shandong Chenming) 5061399.69 5061399.69
Automation upgrade for water treatment
(Jilin Chenming) 662764.60 662764.60
Others 16960109.91 16960109.91
Total 128183706.78 128183706.78 －
(4) Impairment provision for construction in progress
□ Applicable √ Not applicable
(5) Materials for project
Unit: RMB
Closing balance Opening balance
Book Impairment Book Impairment
Item balance provision Book value balance provision Book value
Special materials 6860479.90 6860479.90 7226885.83 7226885.83
Total 6860479.90 6860479.90 7226885.83 7226885.83
162 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
17. Bearer biological assets
(1) Bearer biological assets under the cost method
√ Applicable □ Not applicable
Unit: RMB
Item Tea tree Total
I. Original carrying amount
1. Opening balance 18704143.60 18704143.60
2. Increase during the period 31227.72 31227.72
(1) Cultivation 31227.72 31227.72
3. Decrease during the period
4. Closing balance 18735371.32 18735371.32
II. Accumulated depreciation
1. Opening balance
2. Increase during the period
3. Decrease during the period
4. Closing balance
III. Impairment provision
1. Opening balance 9352071.80 9352071.80
2. Increase during the period
3. Decrease during the period
4. Closing balance 9352071.80 9352071.80
IV. Carrying amount
1. Closing carrying amount 9383299.52 9383299.52
2. Opening carrying amount 9352071.80 9352071.80
(2) Impairment test on bearer biological assets under the cost method
□ Applicable √ Not applicable
(3) Bearer biological assets measured at fair value
□ Applicable √ Not applicable
SHANDONG CHENMING PAPER HOLDINGS LIMITED 163
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
18. Right-of-use assets
(1) Particulars of right-of-use assets
Unit: RMB
Housing
and building
Item Land use rights structure Total
I. Original carrying amount
1. Opening balance 192872810.81 110497066.62 303369877.43
2. Increase during the period
3. Decrease during the period 4478520.86 12385.32 4490906.18
(1) Sublease as financial lease 4354667.66 4354667.66
(2) Other decreases 123853.20 12385.32 136238.52
4. Closing balance 188394289.95 110484681.30 298878971.25
II. Accumulated depreciation
1. Opening balance 34120660.16 3224904.40 37345564.56
2. Increase during the period 3467569.95 3886479.24 7354049.19
(1) Provision 3467569.95 3886479.24 7354049.19
3. Decrease during the period 2416475.15 2416475.15
(1) Sublease as financial lease 2416475.15 2416475.15
4. Closing balance 35171754.96 7111383.64 42283138.60
III. Impairment provision
1. Opening balance
2. Increase during the period
3. Decrease during the period
4. Closing balance
IV. Carrying amount
1. Closing carrying amount 153222534.99 103373297.66 256595832.65
2. Opening carrying amount 158752150.65 107272162.22 266024312.87
Explanation: The reason for other decreases is that the original recognised amount of right-of-use assets was
tax included and as the invoices for leasing have been received the input tax amount offset the original carrying
amount of the right-of-use assets.
(2) Impairment test on right-of-use assets
□ Applicable √ Not applicable
164 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
19. Intangible assets
(1) Particulars of intangible assets
Unit: RMB
Certificates of
Item Land use rights Software Patents third party right Total
I. Original carrying amount
1. Opening balance 2195765131.05 22964503.01 27493613.05 15908674.87 2262131921.98
2. Increase during the period
3. Decrease during the period 4159004.87 4159004.87
(1) Disposal 2413361.78 2413361.78
(2) Disposal of subsidiaries 1745643.09 1745643.09
4. Closing balance 2191606126.18 22964503.01 27493613.05 15908674.87 2257972917.11
II. Accumulated amortisation
1. Opening balance 569617649.10 22664165.23 1673649.21 15908674.87 609864138.41
2. Increase during the period 24116103.19 77821.47 47475.00 24241399.66
(1) Provision 24116103.19 77821.47 47475.00 24241399.66
3. Decrease during the period 2693571.08 2693571.08
(1) Disposal 1130805.06 1130805.06
(2) Disposal of subsidiaries 1562766.02 1562766.02
4. Closing balance 591040181.21 22741986.70 1721124.21 15908674.87 631411966.99
III. Impairment provision
1. Opening balance
2. Increase during the period
3. Decrease during the period
4. Closing balance
IV. Carrying amount
1. Closing carrying amount 1600565944.97 222516.31 25772488.84 1626560950.12
2. Opening carrying amount 1626147481.95 300337.78 25819963.84 1652267783.57
As at the end of the period the intangible assets from internal R&D of the Company accounted for 0.00% of the
balance of intangible assets.
(2) Data resources recognised as intangible assets
□ Applicable √ Not applicable
SHANDONG CHENMING PAPER HOLDINGS LIMITED 165
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
19. Intangible assets (Cont’d)
(3) Right-of-use assets without proper title certificates
Unit: RMB
Reason for not yet obtaining
Item Book value property right certificates
Shouguang Kunhe Trading Co. Ltd. 70832871.07 Under application
Zhanjiang Chenming Pulp & Paper Co. Ltd. 37980537.06 Under application
Shandong Chenming Paper Holdings Limited 1299699.44 Under application
Total 110113107.57
(4) Impairment test on intangible assets
□ Applicable √ Not applicable
20. Goodwill
(1) Original carrying amount of goodwill
Unit: RMB
Increase during Decrease during
the period the period
Arising from
business
N ame of investee or event generating goodwill Opening balance combinations Disposal Closing balance
Jilin Chenming Paper Co. Ltd. 14314160.60 14314160.60
J iangxi Chenming Port Co. Ltd. 8273638.42 8273638.42
T otal 22587799.02 22587799.02
(2) Provision for impairment of goodwill
Unit: RMB
Increase during Decrease during
the period the period
Name of investee or event generating goodwill Opening balance Provision Disposal Closing balance
Jilin Chenming Paper Co. Ltd. 14314160.60 14314160.60
Jiangxi Chenming Port Co. Ltd. 8273638.42 8273638.42
Total 22587799.02 22587799.02
166 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
20. Goodwill (Cont’d)
(3) Specific determination of recoverable amount
Determination of net amount of recoverable amount measured at fair value after deducting disposal expenses
□ Applicable √ Not applicable
Determination of present value of recoverable amount based on expected cash flows
□ Applicable √ Not applicable
(4) Fulfilment of performance undertaking and corresponding impairment of goodwill
Goodwill was formed when a performance undertaking existed and the reporting period or the previous period fell
within the performance undertaking period
□ Applicable √ Not applicable
21. Long-term prepaid expenses
Unit: RMB
Opening Increase during Amortisation Other
Item balance the period during the period deductions Closing balance
Bank advisory fees 249308500.01 26242999.98 233065500.03
Woodland expenses 8126767.91 366276.55 7760491.36
Others 32242278.95 420498.00 1411330.81 31251446.14
T otal 289677546.87 420498.00 28020607.34 262077437.53
SHANDONG CHENMING PAPER HOLDINGS LIMITED 167
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
22. Deferred income tax assets/deferred income tax liabilities
(1) Deferred income tax assets before offsetting
Unit: RMB
Closing balance Opening balance
Deductible Deferred Deductible Deferred
temporary income temporary income
Item difference tax assets difference tax assets
Deductible loss 10916924503.15 1678949045.97 9715020431.43 1565956688.49
Provision for impairment of assets 431530138.58 66116285.84 722577808.85 148433553.46
Outstanding payables 141404891.43 21444445.16 257788652.79 56051325.73
Deferred income 130213596.33 19532039.44 134649677.05 20197451.55
Unrealised profit arising from intra-group
transactions 3157467.73 473620.16
Total 11623230597.22 1786515436.57 10830036570.12 1790639019.23
(2) Deferred income tax liabilities before offsetting
Unit: RMB
Closing balance Opening balance
Taxable temporary Deferred income Taxable temporary Deferred income
I tem differences tax liabilities differences tax liabilities
Asset valuation increment from business
combinations involving entities not under
common control 31348584.67 4702287.70 33371073.97 5005661.10
Unrealised profit arising from intra-group
transactions 14360332.90 3590083.23
Total 31348584.67 4702287.70 47731406.87 8595744.33
(3) The breakdown of unrecognised deferred income tax assets
Unit: RMB
Item Closing balance Opening balance
Deductible temporary difference 6367823535.52 5404679879.65
Deductible loss 3139948553.96 2074025508.84
T otal 9507772089.48 7478705388.49
168 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
22. Deferred income tax assets/deferred income tax liabilities (Cont’d)
(4) Expiry of deductible loss of unrecognised deferred income tax assets falls in the years as follows
Unit: RMB
Year Closing balance Opening balance Remark
2025—208245408.21
2026139420663.59590291155.76
2027112477975.45110332902.30
2028427827841.03425783078.02
20291175261693.52739372964.55
20301284960380.37—
T otal 3139948553.96 2074025508.84
23. Other non-current assets
Unit: RMB
Closing balance Opening balance
Book Impairment Book Impairment
Item balance provision Book value balance provision Book value
Payments for engineering and equipment 130588145.22 130588145.22 125012037.98 125012037.98
Others 302732180.01 302732180.01 290844663.44 290844663.44
T otal 433320325.23 433320325.23 415856701.42 415856701.42
SHANDONG CHENMING PAPER HOLDINGS LIMITED 169
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
24. Assets with restricted ownerships or right to use
Unit: RMB
As at the end of the period As at the beginning of the period
Type of Type of
Item Book balance Book value restriction Restriction Book balance Book value restriction Restriction
Fixed assets 34753954012.60 19712891634.14 Charged As collateral for bank 34375256421.29 20001586415.43 Charged As collateral for bank borrowings and
borrowings and long-term long-term payables (Note VII. 15)
payables (Note VII. 15)
Investment property 6556109499.47 5195027744.73 Charged As collateral for bank 6742657317.44 5433525500.09 Charged As collateral for bank borrowings
borrowings (Note VII. 14) (Note VII. 14)
Intangible assets 1842713402.08 1328582983.12 Charged As collateral for bank 1789243785.12 1312981381.52 Charged As collateral for bank borrowings and
borrowings and long-term long-term payables (Note VII. 19)
payables (Note VII. 19)
Long-term equity 1653602939.71 1649407876.62 Frozen Freeze for non-payment 1549103158.31 1549103158.31 Frozen Freeze for non-payment (Note VII. 12)
investments (Note VII. 12)
Monetary funds 875404665.38 875404665.38 Pledged As deposits for acceptance bills 5728747806.12 5728747806.12 Pledged As deposits for acceptance bills and
frozen and letters of credit security frozen letters of credit deposits for letter
deposits for loans deposit of guarantee security deposits for
reserves or account locked- loans deposit reserves or account
up freezing by litigation etc. locked-up interest receivable
(Note VII. 1) freezing by litigation etc.(Note VII. 1)
Inventories 20028521.46 14865436.95 Seized Seizure due to non-payment 120195864.99 103566055.40 Seized Seizure due to non-payment
by court (Note VII. 8) by court (Note VII. 8)
Accounts receivable 207017962.56 206147426.74 Pledged As pledge for borrowings (Note VII. 4)
Total 45701813040.70 28776180340.94 50512222315.83 34335657743.61
Other explanation:
As at 30 June 2025 housing building structure and equipment with the carrying amount of RMB19712891634.14
(31 December 2024: carrying amount of RMB20001586415.43) investment properties with the carrying amount of
RMB5195027744.73 (31 December 2024: carrying amount of RMB5433525500.09) and intangible assets with the
carrying amount of RMB1328582983.12 (31 December 2024: carrying amount of RMB1312981381.52) were pledged
as collateral for long-term borrowings of RMB2970922783.69 (31 December 2024: RMB3669467809.18) short-
term borrowings of RMB2134928749.43 (31 December 2024: RMB1375200404.98) and long-term payables of
RMB3434953627.32 (31 December 2024: RMB3600767587.75).
170 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
25. Short-term borrowings
(1) Classification of short-term borrowings
Unit: RMB
Item Closing balance Opening balance
Credit borrowings 11776210057.84 8179010348.64
Guaranteed borrowings 8654559071.44 8087802486.06
Mortgage borrowings 2134928749.43 1375200404.98
Discounted borrowings 760520575.24 8292279333.33
Pledged borrowings 846066236.10
T otal 23326218453.95 26780358809.11
Explanation of the classification of short-term borrowings:
* For classification and amount of mortgage borrowings and mortgage assets please see 1. Monetary funds
and 24. Assets with restricted ownerships or right to use in Note VII.* Short-term borrowings included accrued interest of RMB64501511.68.* Mortgage borrowings of RMB1880000000.00 and discounted borrowings of RMB14000000.00 were also
guaranteed by related parties.
(2) Overdue outstanding short-term borrowings
At the end of the period the overdue debts of the Company totalled RMB3972836482.31 of which overdue
short-term borrowings amounted to RMB905650183.88 and in accordance with Interpretation No. 17 the
liabilities transferred to short-term borrowings totalled RMB3067186298.43 including overdue bank acceptance
bills of RMB1145186298.43 overdue long-term borrowings of RMB1652000000.00 and non-current liabilities
due within one year – bank loans of RMB270000000.00.SHANDONG CHENMING PAPER HOLDINGS LIMITED 171
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
25. Short-term borrowings (Cont’d)
(2) Overdue outstanding short-term borrowings (Cont’d)
Major overdue outstanding short-term borrowings are as follows:
Unit: RMB
Overdue
Borrower Closing balance Borrowing rate Overdue time interest rate
Guangdong Branch of
China Development Bank 940000000.00 4.90% 2024-12-20 7.35%
Zhejiang Chouzhou Commercial
Bank Co. Ltd. 520000000.00 4.00% 2025-6-20 12.00%
Jinan Branch of Bank of
Tianjin Co. Ltd. 232000000.00 6.50% 2025-1-11 9.75%
Zhanjiang Branch of Bank of
Communications Co. Ltd. 167270782.44 3.30%-4.15% 2024-11-21 4.95%-6.15%
Daixi Sub-branch of Bank of
Taian Co. Ltd. 150000000.00 3.50% 2025-3-12 18.00%
Total 2009270782.44 － － －
26. Bills payable
Unit: RMB
Category Closing balance Opening balance
Commercial acceptance bills 107370000.00 1213818112.99
Bank acceptance bills 210100000.00
Total 107370000.00 1423918112.99
Explanation: Total outstanding bills payable due as at the end of the period amounted to RMB2561992199.27 which
was classified and presented as accounts payable other payables and short-term borrowings.
172 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
27. Accounts payable
(1) Particulars of accounts payable
Unit: RMB
Item Closing balance Opening balance
Payment for goods 8010998632.51 7272978630.96
Payment for engineering 212032090.10 217322928.02
Payment for equipment 116657952.68 117822089.47
Service fees 2903764.11 2163435.99
Others 84309631.91 98680322.03
Total 8426902071.31 7708967406.47
(2) Disclosure by ageing
Unit: RMB
Reason for outstanding
Item Closing balance or not transfer
Within 1 year (including 1 year) 7684419134.32 As agreed in the contract and the
liquidity shortage of the Company
1 to 2 years 490738853.69 As agreed in the contract and the
liquidity shortage of the Company
2 to 3 years 40164091.58 As agreed in the contract and the
liquidity shortage of the Company
Over 3 years 211579991.72 As agreed in the contract and the
liquidity shortage of the Company
T otal 8426902071.31
The basis used by the ageing analysis of the accounts payable of the Company: the ageing of accounts payable
is the length of time of the Company’s outstanding accounts payable based on invoice date. The closing balance
is recognised one by one from the end of the period onwards until the amounts add up to the balance. It is also
broken up by intervals of within 1 year 1-2 years 2-3 years and over 3 years.SHANDONG CHENMING PAPER HOLDINGS LIMITED 173
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
28. Other payables
Unit: RMB
Item Closing balance Opening balance
Other payables 3214409117.45 2710367670.63
Interest payable 248725295.32 63042283.31
Dividend payable 97493880.88 123000000.00
Total 3560628293.65 2896409953.94
(1) Interest payable
Unit: RMB
Item Closing balance Opening balance
Interest on overdue borrowings 220268057.23 49289730.81
Interest on overdue finance lease payments 17760344.32 2512937.26
Interest on overdue bills 5921978.62 2397040.00
Interest on overdue finance lease payments 4774915.15 8842575.24
T otal 248725295.32 63042283.31
(2) Dividend payable
Unit: RMB
Item Closing balance Opening balance
Jianxin Financial Asset Investment Co. Ltd. 42000000.00 42000000.00
Minmetals International Trust Co. Ltd. 28323937.26
Weifang Chenrong Growth Driver Replacement Equity
Investment Fund Partnership (Limited Partnership) 27000000.00 27000000.00
Minmetals Wealth and Investment Management Co. Ltd. 113295.75
Chenming (Qingdao) Asset Management Co. Ltd. 56647.87
Weifang Chenchuang Equity Investment Fund Partnership
(Limited Partnership) 54000000.00
T otal 97493880.88 123000000.00
174 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
28. Other payables (Cont’d)
(3) Other payables
1) Other payables by nature
Unit: RMB
Item Closing balance Opening balance
Open credit 2439351513.90 2194650156.21
Accrued expenses 471880002.70 282776392.24
Guarantee deposit deposit and warranty 214256238.08 182034513.50
Others 88921362.77 50906608.68
Total 3214409117.45 2710367670.63
29. Receipts in advance
(1) Particulars of receipts in advance
Unit: RMB
Item Closing balance Opening balance
Prepaid rents and property fees 48105994.72 54538940.24
T otal 48105994.72 54538940.24
30. Contract liabilities
Unit: RMB
Item Closing balance Opening balance
Payment for goods in advance 189324752.36 274829824.35
Total 189324752.36 274829824.35
SHANDONG CHENMING PAPER HOLDINGS LIMITED 175
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
31. Employee benefits payable
(1) Particulars of staff remuneration payables
Unit: RMB
Increase Decrease
Opening during during Closing
Item balance the period the period balance
I. Short-term remuneration 249763696.29 408587022.82 345674581.32 312676137.79
II. Retirement benefit plan – defined
contribution scheme 1623963.71 85966286.98 86203908.14 1386342.55
III. Termination benefits 221916.11 221916.11
T otal 251387660.00 494775225.91 432100405.57 314062480.34
(2) Particulars of short-term remuneration
Unit: RMB
Decrease
Increase during during
Item Opening balance the period the period Closing balance
1. Salaries bonuses allowance and subsidies 226577081.55 321179076.58 267816566.79 279939591.34
2. Staff welfare 14186379.98 14186379.98
3. Social insurance premium 556514.71 38968276.70 35800036.52 3724754.89
Including: Medical insurance premium 509385.25 35029787.20 31977090.04 3562082.41
Work-related injury insurance premium 10519.09 3632550.08 3505662.58 137406.59
Maternity insurance premium 36610.37 305939.42 317283.90 25265.89
4. Housing provident funds 11133496.47 27700425.18 26850734.34 11983187.31
5. Union funds and workers’ education 10352340.61 5047759.00 612385.58 14787714.03
6. Other short-term remuneration 1144262.95 1505105.38 408478.11 2240890.22
Total 249763696.29 408587022.82 345674581.32 312676137.79
(3) Defined contribution plan
Unit: RMB
Increase Decrease
Opening during during Closing
Item balance the period the period balance
1. Basic pension insurance premiums 1263873.32 82358353.22 82814271.72 807954.82
2. Unemployment insurance premiums 360090.39 3607933.76 3389636.42 578387.73
T otal 1623963.71 85966286.98 86203908.14 1386342.55
176 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
32. Taxes payable
Unit: RMB
Item Closing balance Opening balance
Value added tax 68358758.37 86589345.15
Property tax 56515035.01 44930390.41
Land use tax 15365983.33 19563508.13
Land appreciation tax 8071413.88 2024028.20
Educational surcharges and others 6436370.01 4599189.85
Resource tax 4920092.08 5839230.84
Stamp duty 2999198.91 11784134.43
Urban maintenance and construction tax 2644196.09 5779995.16
Environmental protection tax 2215937.33 3282700.03
Individual income tax 854003.54 2280921.30
Enterprise income tax 400798.56 6750896.17
Total 168781787.11 193424339.67
33. Non-current liabilities due within one year
Unit: RMB
Item Closing balance Opening balance
Long-term borrowings due within one year 2074899052.38 1207756283.94
Long-term payables due within one year 457126127.13 367723693.41
Lease liabilities due within one year 2485935.07 2456986.79
Total 2534511114.58 1577936964.14
34. Other current liabilities
Unit: RMB
Item Closing balance Opening balance
Overdue financial leasing borrowings 844340067.04 2680562600.58
Total 844340067.04 2680562600.58
SHANDONG CHENMING PAPER HOLDINGS LIMITED 177
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
35. Long-term borrowings
(1) Types of long-term borrowings
Unit: RMB
Item Closing balance Opening balance
Mortgage borrowings 2970922783.69 3669467809.18
Credit borrowings 1618568495.96 1221043391.30
Guaranteed borrowings 1187334452.57 1080907277.70
Subtotal 5776825732.22 5971418478.18
Less: Long-term borrowings due within one year 2074899052.38 1207756283.94
T otal 3701926679.84 4763662194.24
Other explanation:
* For classification and amount of mortgage borrowings and mortgage assets please see 1. Monetary funds
and 24. Assets with restricted ownerships or right to use in Note VII.* In accordance with Interpretation No. 17 of Accounting Standards for Business Enterprises the Company
reclassified long-term payables that were past due and non-current liabilities that were previously reported
as due within one year. The loan agreement stipulates that in the event of a loan overdue the creditor shall
require the borrower to immediately repay the full amount of the loan. Since the above debts had triggered
the default clause in the contract and no extension agreement had been reached with the creditors on
the balance sheet date based on the characteristics of liquidity risk and the immediacy of repayment
obligations the Company adjusted the full amount of the book balance to the “other current liabilities”
account.* Among mortgage borrowings borrowings of RMB2865831101.20 have been guaranteed by related
parties.* Long-term borrowings included accrued interest of RMB2254042.96.
36. Lease liabilities
Unit: RMB
Item Closing balance Opening balance
Lease payments payable 51846485.65 52866869.42
Less: Unrecognised financing expenses 12899556.37 13317409.57
Subtotal 38946929.28 39549459.85
Less: Lease liabilities due within one year 2485935.07 2456986.79
T otal 36460994.21 37092473.06
178 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
37. Long-term payables
Unit: RMB
Item Closing balance Opening balance
Long-term payables 2544988247.10 774965008.29
T otal 2544988247.10 774965008.29
Explanation: In accordance with Interpretation No. 17 of Accounting Standards for Business Enterprises the Company
reclassified long-term payables that were past due and non-current liabilities that were previously reported as due within
one year. The loan agreement stipulates that in the event of a loan overdue the creditor shall require the borrower to
immediately repay the full amount of the loan. Since the above debts had triggered the default clause in the contract and
no extension agreement had been reached with the creditors on the balance sheet date based on the characteristics of
liquidity risk and the immediacy of repayment obligations the Company adjusted the full amount of the book balance to
the “other current liabilities” account.
(1) Long-term payables by nature
Unit: RMB
Item Closing balance Opening balance
Financial leasing borrowings 3434953627.32 3600767587.75
China Development Bank Special Fund 275000000.00 275000000.00
Contributions by other partners 140894158.22 137894158.22
Retention for the financial leasing operations 6000000.00
Subtotal 3850847785.54 4019661745.97
Less: Long-term payables due within one year 457126127.13 367723693.41
Less: Other current liabilities 848733411.31 2876973044.27
T otal 2544988247.10 774965008.29
Other explanation:
Contributions by other partners refer to the contributions made by other partners to Weifang Chenming Growth
Driver Replacement Equity Investment Fund Partnership (Limited Partnership) and Weifang Chendu Equity
Investment Partnership (Limited Partnership) and such contributions are reclassified as financial liabilities on a
consolidation basis.SHANDONG CHENMING PAPER HOLDINGS LIMITED 179
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
38. Provisions
Unit: RMB
Item Closing balance Opening balance Reason
Pending litigations 5935000.00 5935000.00 Estimated compensation
for losses
T otal 5935000.00 5935000.00
Other explanation: The Company was involved in a number of legal proceedings and a total of RMB5935000.00 was
provided as provisions based on the potential compensation for losses
39. Deferred income
Unit: RMB
Increase during Decrease during
Item Opening balance the period the period Closing balance Reason
Government grants 1240939485.52 51375768.98 1189563716.54 Financial provision
Total 1240939485.52 51375768.98 1189563716.54
Items in respect of government grants:
Unit: RMB
Include in Include Written down
New grants non-operating in other against cost
Opening during the income for income for expenses for Other Closing Asset-related/
Liability item balance period the period the period the period changes balance income-related
Funding for environmental protection 478415952.52 25464041.36 452951911.16 Asset-related
Huanggang forestry-pulp-paper project 420942087.45 12513108.90 408428978.55 Asset-related
Infrastructure and environmental protection
engineering 185285787.80 5758794.74 179526993.06 Asset-related
Financial subsidies for technological
transformation project 89417910.72 4666552.48 84751358.24 Asset-related
Zhanjiang forestry-pulp-paper project 38522698.43 2047316.46 36475381.97 Asset-related
Project fund for National Key Technology
Research and Development Program 629025.00 82350.00 546675.00 Asset-related
Others 27726023.60 843605.04 26882418.56 Asset-related
T otal 1240939485.5 2 51375768.9 8 1189563716.54
180 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
40. Share capital
Unit: RMB
Increase/decrease during the period (+/-)
Shares
converted from
Opening balance New issue Bonus issue reserves Others Subtotal Closing balance
Total number of shares 2934556200.00 2934556200.00
41. Capital reserves
Unit: RMB
Increase during Decrease during
Item Opening balance the period the period Closing balance
Capital premium (share premium) 4478658035.54 35625000.00 2024392.96 4512258642.58
Other capital reserves 729020587.21 729020587.21
Total 5207678622.75 35625000.00 2024392.96 5241279229.79
Other explanations including changes (increase or decrease) during the period and reasons for such changes:
Shouguang Chenming Art Paper Co. Ltd. a subsidiary of the Company distributed dividends to the Company during
the period resulting in an increase in capital reserves of RMB35625000.00 under equity transaction; Chenming (HK)
Limited a subsidiary of the Company acquired 25% minority interests in Shouguang Chenming Art Paper Co. Ltd.resulting in a decrease in capital reserves of RMB2024392.96.SHANDONG CHENMING PAPER HOLDINGS LIMITED 181
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
42. Other comprehensive income
Unit: RMB
Amount for the period
Less:
Less: Transferred
Transferred from other
from other comprehensive
comprehensive income
income in prior in prior periods Attributable
Incurred before periods to profit to retained Attributable to to minority
Opening income tax for or loss during profit during Less: Income parent company shareholders
Item balance the period the period the period tax expenses after tax after tax Closing balance
I. Other comprehensive income that
cannot be reclassified to profit or
loss
II. Other comprehensive income that
will be reclassified to profit and
loss -913708670.15 -16019923.39 -16019923.39 -929728593.54
Including: Other comprehensive
income that may be reclassified
to profit and loss under the
equity method -4769636.88 -3795486.93 -3795486.93 -8565123.81
Exchange differences
arising from
translation of
financial statements
denominated in
foreign currencies -908939033.27 -12224436.46 -12224436.46 -921163469.73
Total other comprehensive income -913708670.15 -16019923.39 -16019923.39 -929728593.54
43. Special reserves
Unit: RMB
Increase during Decrease during
Item Opening balance the period the period Closing balance
Production safety expenses 26800491.53 3633487.86 602123.53 29831855.86
Total 26800491.53 3633487.86 602123.53 29831855.86
182 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
44. Surplus reserves
Unit: RMB
Increase during Decrease during
Item Opening balance the period the period Closing balance
Statutory surplus reserves 1212009109.97 1212009109.97
T otal 1212009109.97 1212009109.97
45. General risk provisions
Unit: RMB
Increase during Decrease during
Item Opening balance the period the period Closing balance
General risk provisions 80950584.11 80950584.11
Explanation: The general risk provisions are accrued by the Company’s subsidiaries Shandong Chenming Group Finance
Co. Ltd. and Shandong Chenming Commercial Factoring Co. Ltd. based on 1% of the balance of the receivables.Accordingly the balance of the general risk provisions was adjusted based on the balance of the receivables.
46. Retained profit
Unit: RMB
Item The period The prior period
Retained profit as at the end of the prior period before adjustment 607818020.70 8020182801.55
Adjustment to opening balance of retained earnings (increase + decrease -)
Opening balance of retained profit after adjustment 607818020.70 8020182801.55
Add: N et profit for the period attributable to shareholders of the parent
company -3857953190.56 -7410784491.65
Less: Transfer of statutory surplus reserves
Transfer of discretionary surplus reserves
Transfer of general risk reserves 1580289.20
Dividends on ordinary shares payable
Transfer from dividends on ordinary shares to share capital
R etained profit as at the end of the period -3250135169.86 607818020.70
SHANDONG CHENMING PAPER HOLDINGS LIMITED 183
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
47. Revenue and operating costs
Unit: RMB
Amount for the period Amount for the prior period
Item Revenue Costs Revenue Costs
Principal activities 2065819778.86 3694908807.12 13762711500.16 12089871177.87
Other activities 40811173.44 32294913.12 122020018.88 95634531.13
Total 2106630952.30 3727203720.24 13884731519.04 12185505709.00
Breakdown of revenue and operating costs:
Unit: RMB
Machine-made paper segment Financial services segment Hotel and property rentals Others Total
Category of contract Revenue Operating costs Revenue Operating costs Revenue Operating costs Revenue Operating costs Revenue Operating costs
Type of business 2000620515.50 3562425833.07 6768845.62 35907.36 73535359.10 103857986.20 25706232.08 60883993.61 2106630952.30 3727203720.24
Including:
Machine-made paper 1121420145.71 2643006731.03 1121420145.71 2643006731.03
Chemical pulp 740160267.96 741869112.58 740160267.96 741869112.58
Electricity and steam 98222594.99 145457394.28 98222594.99 145457394.28
Construction materials 2779445.82 10623531.43 2779445.82 10623531.43
Hotel and property rentals 73374807.43 103855284.64 73374807.43 103855284.64
Paper chemicals 104714.25 103652.70 104714.25 103652.70
Others 40712792.59 31988942.48 6768845.62 35907.36 160551.67 2701.56 22926786.26 50260462.18 70568976.14 82288013.58
By geographical area 2000620515.50 3562425833.07 6768845.62 35907.36 73535359.10 103857986.20 25706232.08 60883993.61 2106630952.30 3727203720.24
Including:
Mainland China 1969072997.41 3473430308.85 6768845.62 35907.36 73535359.10 103857986.20 25706232.08 60883993.61 2075083434.21 3638208196.02
Other countries and regions 31547518.09 88995524.22 31547518.09 88995524.22
By the timing of delivery 2000620515.50 3562425833.07 6768845.62 35907.36 73535359.10 103857986.20 25706232.08 60883993.61 2106630952.30 3727203720.24
Including:
Goods (at a point in time) 1900936879.21 3416476732.55 25706232.08 60883993.61 1926643111.29 3477360726.16
Services
(within a certain period) 99683636.29 145949100.52 6768845.62 35907.36 73535359.10 103857986.20 179987841.01 249842994.08
By sales channel 2000620515.50 3562425833.07 6768845.62 35907.36 73535359.10 103857986.20 25706232.08 60883993.61 2106630952.30 3727203720.24
Including:
Distribution 1362414466.37 2477252007.13 1362414466.37 2477252007.13
Direct sales 638206049.13 1085173825.94 6768845.62 35907.36 73535359.10 103857986.20 25706232.08 60883993.61 744216485.93 1249951713.11
Total 2000620515.50 3562425833.07 6768845.62 35907.36 73535359.10 103857986.20 25706232.08 60883993.61 2106630952.30 3727203720.24
184 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
47. Revenue and operating costs (Cont’d)
Information related to performance obligations:
Types of
Nature of goods that Whether the Company’s quality assurance
Time for fulfilment of the Company person is the commitments offered by the
performance Significant terms of undertakes primary person expected to be Company and
Item obligations payment to transfer in charge refunded to customers related obligations
Machine-made paper Domestic sales on the Domestic sales tend Produces easily Yes None Guaranteed quality
day of delivery to the to be provided on an distinguishable assurance should there
customer; foreign sales invoice basis; foreign be objections to product
on the day of customs sales tend to be prepaid quality within 7 days
clearance of arrival the products
can be returned and
exchanged
Other explanations: The Company’s performance obligations for sales of machine-made paper are generally less than
one year and the Company takes advance payments or provides credit terms depending on the customer. When the
Company is the primary responsible party for a sale it generally obtains the unconditional right to receive payment
when control of the merchandise is transferred to the customer either at the time of shipment or upon delivery to the
destination specified by the customer.Information related to the transaction price allocated to residual performance obligations:
As at the end of the reporting period the amount of revenue with signed contracts but unfulfilled or uncompleted
performance obligation was RMB189324752.36 in which RMB189324752.36 was expected to be recognised in 2025.SHANDONG CHENMING PAPER HOLDINGS LIMITED 185
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
48. Taxes and surcharges
Unit: RMB
Amount for Amount for
Item the period the prior period
Urban property tax 40761759.16 41691189.19
Urban land use tax 8657177.86 23596390.50
Stamp duty 3465570.60 27045444.39
Urban maintenance and construction tax 3261575.91 5628724.65
Educational surcharges and local education surcharges 2344185.65 4107340.96
Resource tax 1458473.24 7474477.00
Environmental protection tax 1180968.27 6753382.64
Water conservancy construction fund 29570.39 424555.73
Vehicle and vessel tax 27523.76 25897.59
T otal 61186804.84 116747402.65
49. General and administrative expenses
Unit: RMB
Amount for Amount for
Item the period the prior period
Wages and surcharges 122791612.84 107661916.80
Depreciation expenses 61317109.84 59471794.52
Business hospitality expenses 3519641.27 47703471.67
Amortisation of intangible assets and long-term expenses 23807875.66 25046414.18
Welfare expenses 16120053.90 23910644.65
Legal costs 5418632.83 10840988.90
Repair cost and consumption of materials 4190028.66 6462342.01
Insurance premium 5009295.05 6695006.66
Intermediary service expenses 7766799.04 4654917.80
Litigation expenses 7811341.86 925385.55
Others 30018740.31 24062533.41
T otal 287771131.26 317435416.15
186 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
50. Sales and distribution expenses
Unit: RMB
Amount for Amount for
Item the period the prior period
Wages and surcharges 29832933.51 48843122.23
Business hospitality expenses 3181247.99 21071398.70
Travel expenses 3233398.64 13823032.53
Depreciation expenses 2313519.46 1480291.62
Rental expenses 1681184.07 3428387.22
Selling commissions 1001014.52 2472705.10
Warehouse expenses 336609.37 301394.66
Office expenses 151615.98 1175994.99
Others 9381743.02 6707504.16
T otal 51113266.56 99303831.21
51. Research and development expense
Unit: RMB
Amount for Amount for
Item the period the prior period
Depreciation expenses 14930274.98 36311580.22
Wages and surcharges 10026470.26 63586172.66
Consumption of materials 6530356.81 414455113.32
Insurance premium 2282295.78 13601674.17
Utilities 1770284.72 76607858.27
Welfare expenses 469909.54 3372176.58
Housing provident funds 350817.26 2265763.36
Other expenses 206776.34 1713757.83
Total 36567185.69 611914096.41
52. Finance expenses
Unit: RMB
Amount for Amount for
Item the period the prior period
Interest expenses 774744373.14 854610967.90
Less: Capitalised interest amount
Interest income 26462669.15 104024655.22
Foreign exchange gains and losses -437994.69 -40639311.96
Less: Capitalisation of foreign exchange gains and losses
Bank charges and others 56822030.95 146508498.45
T otal 804665740.25 856455499.17
SHANDONG CHENMING PAPER HOLDINGS LIMITED 187
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
53. Other income
Unit: RMB
Amount for Amount for
Source of other income the period the prior period
Government grants – amortised deferred income included in profit or loss 51375768.98 53368860.21
Government grants – directly included in profit or loss 1180571.41 10932524.83
Additional deduction of VAT 7174324.76 94956915.41
Refund of handling fees for withholding and payment of individual income
tax 214644.12 498630.65
Tax and fee credits for the employment of priority groups 20800.00
Gain on debt restructuring -37171293.24 188197.54
T otal 22794816.03 159945128.64
54. Gain on change in fair value
Unit: RMB
Amount for Amount for
Source of gain on change in fair value the period the prior period
Gain on change in fair value of consumable biological assets measured
at fair value -129059190.34 5184193.11
Financial assets held for trading -428371.45 -7405789.55
T otal -129487561.79 -2221596.44
55. Investment income
Unit: RMB
Amount for Amount for
Item the period the prior period
Income from long-term equity investments accounted for using
the equity method -345974520.50 -38682172.19
Investment gain on derecognition of financial assets -84861658.28 -23412008.23
Investment gain on disposal of long-term equity investments 166396.34 216154711.23
Gain on debt restructuring 3313951.90
Investment income on holding other non-current financial assets 23957613.40
Total -430669782.44 181332096.11
188 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
56. Credit impairment loss
Unit: RMB
Amount for Amount for
Item the period the prior period
Bad debt loss of financial lease payments -269438303.29 -39247964.34
Bad debt loss of other receivables -179763373.73 -27642759.88
Bad debt loss of bills receivable and accounts receivable -57120747.20 -57495895.44
T otal -506322424.22 -124386619.66
57. Loss on impairment of assets
Unit: RMB
Amount for Amount for
Item the period the prior period
Impairment losses on fixed assets -237168462.20
Loss on inventory impairment -3392947.12 -3041427.75
Total -240561409.32 -3041427.75
58. Gain on disposal of assets
Unit: RMB
Amount for Amount for
Source of gain on disposal of assets the period the prior period
Gain on disposal of fixed assets (“-” denotes loss) -15280125.77 19222812.60
Gain on disposal of intangible assets (“-” denotes loss) 3608128.98
Sublease 1857387.16
T otal -9814609.63 19222812.60
SHANDONG CHENMING PAPER HOLDINGS LIMITED 189
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
59. Non-operating income
Unit: RMB
Included in non-
Amount for Amount for recurring profit or
Item the period the prior period loss in the period
Fines compensation income 506006.84 1900470.03 506006.84
Gain on damage and retirement of
non-current assets 424361.80 395610.51 424361.80
Exempted debts 44005.86 366717.74 44005.86
Others 95388.68 88688.65 95388.68
T otal 1069763.18 2751486.93 1069763.18
60. Non-operating expenses
Unit: RMB
Included in non-
Amount for Amount for recurring profit or
Item the period the prior period loss in the period
Litigation 18557771.90 18557771.90
Loss on damage and retirement of non-current
assets 7365056.39 639215.79 7365056.39
Donation 300000.00
Others 275661.26 74335.21 275661.26
T otal 26198489.55 1013551.00 26198489.55
61. Income tax expenses
(1) Particulars of income tax expenses
Unit: RMB
Amount for Amount for
Item the period the prior period
Current income tax expenses 3591433.75 30685170.68
Deferred income tax expenses 12167.16 -127086125.02
Total 3603600.91 -96400954.34
190 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
61. Income tax expenses (Cont’d)
(2) The reconciliation between accounting profit and income tax expenses
Unit: RMB
Amount for
Item the period
Total profit -4181066594.28
Income tax expenses calculated at statutory/applicable tax rates -627159989.14
Effect of different tax rates applicable to subsidiaries -37496607.55
Adjustments to income tax for prior periods 2420144.07
Profit and loss of joint ventures and associates accounted for using the equity method 63667400.93
Effect of non-taxable income -429650.00
Effect of non-deductible costs expenses and losses 2745425.69
Effect of utilisation of previously unrecognised deductible loss on deferred income
tax assets -49807817.33
Effect of current unrecognised deductible temporary difference or deductible loss
arising from deferred tax income assets 280598337.27
Tax effect of R&D fee deduction -741944.36
Tax incentives such as 10% deduction for income from particle board -361650.58
Deferred income taxes that have not been recognised as deductible losses and
deductible temporary differences in previous years are reversed in the current period 370169951.91
I ncome tax expenses 3603600.91
62. Other comprehensive income
Please refer to note VII. 42.
63. Items on statements of cash flow
(1) Cash relating to operating activities
Cash received relating to other operating activities
Unit: RMB
Amount for Amount for
Item the period the prior period
Net proceedings from the leasing 296122799.18
Interest income 28395905.89 98034655.22
Open credit and other income 16692884.99 37948513.99
Government grants 1395215.53 14674965.71
T otal 342606805.59 150658134.92
SHANDONG CHENMING PAPER HOLDINGS LIMITED 191
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
63. Items on statements of cash flow (Cont’d)
(1) Cash relating to operating activities (Cont’d)
Cash paid relating to other operating activities
Unit: RMB
Amount for Amount for
Item the period the prior period
Expenses and open credit 155468426.33 944194644.80
T otal 155468426.33 944194644.80
(2) Cash relating to financing activities
Cash received relating to other financing activities
Unit: RMB
Amount for Amount for
Item the period the prior period
Net recovery of guarantee deposit 4853343140.74 777685703.00
Equipment finance lease received 1075100000.00
Total 4853343140.74 1852785703.00
Cash paid relating to other financing activities
Unit: RMB
Amount for Amount for
Item the period the prior period
Repayment of equipment finance lease 96850437.40 1379961193.13
Acquisition of non-controlling interests 35748432.27 300000000.00
Current accounts 2065000.00 19350000.00
Repayment of borrowings from China Development Bank funds 68750000.00
Payment of deposit for equipment finance lease 19000000.00
T otal 134663869.67 1787061193.13
192 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
63. Items on statements of cash flow (Cont’d)
(2) Cash relating to financing activities (Cont’d)
Changes in liabilities arising from financing activities
√ Applicable □ Not applicable
Unit: RMB
Increase during the period Decrease during the period
Item Opening balance Cash changes Non-cash changes Cash changes Non-cash changes Closing balance
Short-term borrowings 26780358809.11 11108739570.98 1982684773.73 16545564699.87 23326218453.95
Long-term borrowings 5971418478.18 595815126.64 94001419.44 107992497.58 776416794.46 5776825732.22
Long-term payables 4019661745.97 3000000.00 96850437.40 74963523.03 3850847785.54
Other payables (financing) 1071906381.38 584569429.98 378055509.02 1278420302.34
Lease liabilities 39549459.85 602530.57 38946929.28
Total 37882894874.49 12289124127.60 2079686193.17 17128463143.87 851982848.06 34271259203.33
SHANDONG CHENMING PAPER HOLDINGS LIMITED 193
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
64. Supplementary information on cash flow statement
(1) Supplementary information on cash flow statement
Unit: RMB
Amount for Amount for
Supplementary information the period the prior period
1. Reconciliation of net profit as cash flows from operating activities:
Net profit -4184670195.19 26358848.22
Add: Provision for asset impairment 746883833.54 127428047.41
Depreciation of fixed assets and depreciation of investment 1150193136.16 1145055049.34
properties
Depreciation of right-of-use assets 7354049.19 3860982.48
Amortisation of intangible assets 24241399.66 26716784.88
Amortisation of long-term prepaid expenses 28020607.34 1664214.03
Loss on disposal of fixed assets intangible assets and other 74046077.18 -19222812.60
long-term assets (“-” denotes gain)
Loss on retirement of fixed assets (“-” denotes gain) 6940694.59 243605.28
Loss on changes in fair value (“-” denotes gain) 129487561.79 2221596.44
Finance expenses (“-” denotes gain) 774744373.14 854610967.90
Investment loss (“-” denotes gain) 430669782.44 -181332096.11
Decrease in deferred income tax assets 4123582.66 -124990592.41
(“-” denotes increase)
Increase in deferred income tax liabilities -3893456.63 -4181124.55
(“-” denotes decrease)
Decrease in inventories (“-” denotes increase) 171157767.76 694547012.92
Decrease in operating receivables (“-” denotes increase) 319526202.19 -544020781.43
Increase in operating payables (“-” denotes decrease) 1106477858.37 -16460308.73
Others
Net cash flows from operating activities 785303274.19 1992499393.07
2. Major investing and financing activities not involving cash
settlements:
Capital converted from debts
Convertible corporate bonds due within one year
Fixed assets under finance leases
3. Net change in cash and cash equivalents:
Closing balance of cash 62979338.05 802830084.55
Less: Opening balance of cash 151943246.31 764233742.61
Add: Closing balance of cash equivalents
Less: Opening balance of cash equivalents
Net increase in cash and cash equivalents -88963908.26 38596341.94
194 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
64. Supplementary information on cash flow statement (Cont’d)
(2) Net cash paid for acquisition of subsidiaries in current period
Unit: RMB
Amount
Cash or cash equivalents paid in the current period for merger during the period 512000000.00
Including: Weifang Chenchuang Equity Investment Fund Partnership (Limited Partnership) 512000000.00
Less: Cash and cash equivalents held by subsidiaries at the date of acquisition 3044083.87
Including: Weifang Chenchuang Equity Investment Fund Partnership (Limited Partnership 3044083.87
Net cash paid for acquisition of subsidiaries 508955916.13
(3) Net cash from disposal of subsidiaries received in current period
Unit: RMB
Amount
Cash or cash equivalents received in the current period from disposal of subsidiaries during
the period 650000.00
Including: Shouguang Wei Yuan Logistics Company Limited 650000.00
Net cash received from disposal of subsidiaries 650000.00
(4) Cash and cash equivalents composition
Unit: RMB
Item Closing balance Opening balance
I. Cash 62979338.05 151943246.31
Including: Treasury cash 2394083.00 1363319.76
Bank deposit that can be used for payment at any time 60585255.05 150579926.55
II. Cash equivalent
I II. Balance of cash and cash equivalents as at the end of the period 62979338.05 151943246.31
(5) Monetary funds other than cash and cash equivalents
Unit: RMB
Amount for Amount for Reasons why it is not cash and
Item the period the prior period cash equivalents
Other monetary funds 875404665.38 5728747806.12 See Note VII.1 for details
Interest accrued on deposits 15277493.17 29188759.75 See Note VII.1 for details
Total 890682158.55 5757936565.87
65. Notes to items of statements of changes in owners’ equity
Nil
SHANDONG CHENMING PAPER HOLDINGS LIMITED 195
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
66. Foreign currency items
(1) Foreign currency items
Unit: RMB
Closing foreign Closing balance
Item currency balance Exchange rate in RMB
Monetary funds
Including: USD 3758867.54 7.1586 26908229.17
EUR 764858.94 8.4024 6426650.76
HKD 25507.63 0.9120 23262.96
GBP 1777.90 9.8300 17476.76
JPY 1197.00 0.0496 59.37
Accounts receivable
Including: USD 4637688.38 7.1586 33199356.04
EUR 15735.16 8.4024 132213.11
JPY 146734998.00 0.0496 7278055.90
Other receivables
Including: USD 1967728.81 7.1586 14086183.46
EUR 191821.66 8.4024 1611762.32
Accounts payable
Including: USD 78045922.37 7.1586 558699539.88
EUR 525599.99 8.4024 4416301.36
JPY 209964.51 0.0496 10414.24
Other payables
Including: EUR 8526.69 8.4024 71644.66
Long-term borrowings
Including: EUR 3593696.00 8.4024 30195671.27
Short-term borrowings
Including: USD 3810072.28 7.1586 27274783.42
(2) Explanation on overseas operating entities (including major overseas operating entities) which shall disclose
their overseas principal places of business functional currency and basis. Reasons shall be disclosed if there
is any change in the functional currency.√ Applicable □ Not applicable
Principal place of Place of Functional
No. Name of subsidiary business operation currency
1 Chenming GmbH Hamburg Germany Hamburg Germany EUR
2 Chenming Paper Korea Co. Ltd. Seoul Korea Seoul Korea KRW
3 Chenming Paper Japan Co. Ltd. Tokyo Japan Tokyo Japan JPY
4 Chenming Paper United States Co. Ltd. Los Angeles USA Los Angeles USA USD
5 Chenming (Overseas) Co. Ltd. Hong Kong China Hong Kong China USD
6 Chenming (Singapore) Co. Ltd. Singapore Singapore USD
7 Chenming (HK) Limited Hong Kong China Hong Kong China USD
8 Chenming International Trade Import and Hong Kong China Hong Kong China USD
Export Co. Limited
196 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
67. Leases
(1) The Company as a lessee
√ Applicable □ Not applicable
Variable lease payment not included in lease liabilities measurement
□ Applicable √ Not applicable
Simplified treatment of lease expenses for short-term leases or leases of low-value assets
√ Applicable □ Not applicable
Unit: RMB
Amount for
Item the period
Short-term lease expenses 2220927.78
Total 2220927.78
(2) The Company as a lessor
Operating lease as a lessor
√ Applicable □ Not applicable
Unit: RMB
Including: Income related to
variable lease payments
Item Lease income not included in lease receipts
Lease income 60638854.58
Total 60638854.58
SHANDONG CHENMING PAPER HOLDINGS LIMITED 197
INTERIM REPORT 2025VIII Financial Report
VII. Notes to items of the consolidated financial statements (Cont’d)
67. Leases (Cont’d)
(2) The Company as a lessor (Cont’d)
Financial lease as a lessor
□ Applicable √ Not applicable
Undiscounted lease payments for each of the next five years
√ Applicable □ Not applicable
Unit: RMB
Annual undiscounted lease payments
Item Closing balance Opening balance
The first year 113444741.22 152207821.18
The second year 116223430.35 159924290.10
The third year 124807602.90 157974084.34
The fourth year 134385334.75 160776701.99
The fifth year 141878129.24 158478080.32
Total undiscounted lease payments after five years 140844716.92 155500794.16
T otal 771583955.38 944861772.09
VIII. R&D Expenses
Unit: RMB
Amount for Amount for
Item the period the prior period
Depreciation expenses 14930274.98 36311580.22
Wages and surcharges 10026470.26 63586172.66
Consumption of materials 6530356.81 414455113.32
Insurance premium 2282295.78 13601674.17
Utilities 1770284.72 76607858.27
Welfare expenses 469909.54 3372176.58
Housing provident funds 350817.26 2265763.36
Other expenses 206776.34 1713757.83
Total 36567185.69 611914096.41
I ncluding: R&D expenses included in profit or loss 36567185.69 611914096.41
198 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
SHANDONG CHENMING PAPER HOLDINGS LIMITED 199
INTERIM REPORT 2025
IX. Change in Scope of Consolidation
1. Disposal of subsidiaries
Any transaction or event that results in the loss of control of any subsidiary during the period
√ Yes □ No
Unit: RMB
Determination
and key
Difference assumption of
between Carrying amount Fair value of fair value of Relevant other
consideration of remaining remaining remaining comprehensive
and share shareholding shareholding shareholding income of
of net assets as of the date as of the date as of the date former
of relevant Remaining of loss of of loss of of loss of subsidiary
Disposal Disposal Basis for subsidiary as shareholding control as per control as per Gain or loss control as per transferred
consideration percentage at Disposal method determining per consolidated as of consolidated consolidated in fair value consolidated to profit
at the date of the date of loss at the date of Date of loss the date of loss financial the date of loss financial financial of remaining financial or loss or
Name of subsidiary loss of control of control loss of control of control of control statements of control statements statements shareholding statements retained profit
Shouguang Wei Yuan
Logistics Company
Limited 650000.00 100.00% Transfer 2025-4-30 Loss of control 166396.34 0.00%
Any situation where investments in subsidiaries are disposed of step by step through multiple transactions and control is lost during the period
□ Yes √ No
2. Change in scope of consolidation due to other reasons
During the year 1 subsidiary was newly established namely Chenming International Trade Import and Export Co. Limited. 1 subsidiary was acquired namely
Weifang Chenchuang Equity Investment Fund Partnership (Limited Partnership).VIII Financial Report
X. Interest in Other Entities
1. Interest in subsidiaries
(1) Constitution of the Group
Unit: RMB’0000
Register Principle Shareholding Issued Issued
capital place of Place of Nature of Type of Direct Indirect debt share
Name of subsidiary (’0000) business incorporation business legal person (%) (%) Acquisition securities capital
Shouguang Meilun Paper 480104.55 Shouguang Shouguang Paper making For-profit corporation 68.28 18.50 Establishment 0 0
Co. Ltd.Shouguang Meichen Energy 100.00 Shouguang Shouguang Electricity For-profit corporation 100 Establishment 0 0
Technology Co. Ltd.Shandong Chenming Paper 1000.00 Weifang Weifang Paper product For-profit corporation 100 Establishment 0 0
Co. Ltd. trading
Shouguang Chenming Art 2000.00 (USD) Shouguang Shouguang Paper making For-profit corporation 75 25 Establishment 0 0
Paper Co. Ltd.Shandong Chenming Pulp & 10000.00 Shouguang Shouguang Sales of paper For-profit corporation 100 Establishment 0 0
Paper Sales Co. Ltd. product
Shanghai Chenming Pulp & 10000.00 Shanghai Shanghai Paper product For-profit corporation 100 Establishment 0 0
Paper Sales Co. Ltd. trading
Shandong Chenming Paper 10000.00 Shouguang Shouguang Paper product For-profit corporation 100 Establishment 0 0
Sales Co. Ltd. trading
Chenming International 200.00 (USD) Hong Kong Hong Kong Paper product For-profit corporation 100 Establishment 0 0
Trade Import and Export trading
Co. Limited
Shouguang Chenming Import 70000.00 Shouguang Shouguang Trading For-profit corporation 35.71 64.29 Establishment 0 0
and Export Trade Co. Ltd.Jiangxi Chenming Supply Chain 200.00 Jiangxi Jiangxi Trading For-profit corporation 70 Establishment 0 0
Management Co. Ltd.Zhanjiang Chenming Pulp & 691357.24 Zhanjiang Zhanjiang Paper making For-profit corporation 80.28 Establishment 0 0
Paper Co. Ltd.Zhanjiang Chenming 130000.00 Zhanjiang Zhanjiang Arboriculture For-profit corporation 100 Establishment 0 0
Arboriculture Development
Co. Ltd.Yangjiang Chenming 22000.00 Yangjiang Yangjiang Arboriculture For-profit corporation 100 Establishment 0 0
Arboriculture Development
Co. Ltd.Guangdong Huirui Investment 25800.00 Zhanjiang Zhanjiang Investment For-profit corporation 100 Establishment 0 0
Co. Ltd.Hubei Changjiang Chenming 200100.00 Huanggang Huanggang Fund For-profit corporation 59.97 Establishment 0 0
Huanggang Equity Investment
Fund Partnership (Limited
Partnership)
Hainan Chenming Technology 20000.00 Haikou Haikou Wholesale and For-profit corporation 100 Establishment 0 0
Co. Ltd. retail
Foshan Chenming Import and 20000.00 Foshan Foshan Trading For-profit corporation 100 Establishment 0 0
Export Trade Co. Ltd.Shanghai Heruiming Property 30150.00 Shanghai Shanghai Business For-profit corporation 100 Merger and 0 0
Management Co. Ltd. services acquisition
200 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
X. Interest in Other Entities (Cont’d)
1. Interest in subsidiaries (Cont’d)
(1) Constitution of the Group (Cont’d)
Register Principle Shareholding Issued Issued
capital place of Place of Nature of Type of Direct Indirect debt share
Name of subsidiary (’0000) business incorporation business legal person (%) (%) Acquisition securities capital
Zhanjiang Chenming 10000.00 Zhanjiang Zhanjiang Paper product For-profit corporation 100 Establishment 0 0
Technology Development trading
Co. Ltd.Zhanjiang Meilun Pulp & 10000.00 Zhanjiang Zhanjiang Paper making For-profit corporation 100 Establishment 0 0
Paper Co. Ltd.Guangdong Chenming 1000.00 Guangdong Guangdong Panels For-profit corporation 100 Establishment 0 0
Panels Co. Ltd.Jiangxi Chenming Tea Co. Ltd. 1000.00 Jiangxi Jiangxi Tea business For-profit corporation 100 Establishment 0 0
Jiangxi Chenming Paper 32673.32 (USD) Nanchang Nanchang Paper making For-profit corporation 100 Establishment 0 0
Co. Ltd.Jiangxi Chenming Logistics 500.00 Nanchang Nanchang Logistics For-profit corporation 100 Establishment 0 0
Co. Ltd.Nanchang Shengheng Trading 10000.00 Nanchang Nanchang Trading For-profit corporation 100 Establishment 0 0
Co. Ltd.Nanchang Kunheng Trading 1000.00 Nanchang Nanchang Trading For-profit corporation 100 Establishment 0 0
Co. Ltd.Nanchang Chenming 1000.00 Nanchang Nanchang Arboriculture For-profit corporation 100 Establishment 0 0
Arboriculture Development
Co. Ltd.Jiangxi Chenming Port 1507.00 Jiangxi Jiangxi Cargo For-profit corporation 100 Merger and 0 0
Co. Ltd. transportation acquisition
Shandong Dingkun Asset 100100.00 Shouguang Shouguang Business For-profit corporation 100 Establishment 0 0
Management Partnership services
(Limited Partnership)
Shouguang Kunhe Trading 1000.00 Shouguang Shouguang Trading For-profit corporation 100 Establishment 0 0
Co. Ltd.Jilin Chenming Paper Co. Ltd. 300000.00 Jilin Jilin Paper making For-profit corporation 100 Acquisition 0 0
Fuyu Chenming Paper Co. Ltd. 30800.00 Fuyu Fuyu Paper making For-profit corporation 100 Establishment 0 0
Jilin Chenming New Wall 1000.00 Jilin Jilin Wall materials For-profit corporation 100 Establishment 0 0
Materials Co. Ltd.Jilin Chenming Logistics 1000.00 Jilin Jilin Logistics For-profit corporation 100 Establishment 0 0
Co. Ltd.Jilin Chenming Pulp & 5000.00 Huanggang Huanggang Trading For-profit corporation 100 Establishment 0 0
Fiber Trading Co. Ltd.Huanggang Chenming Pulp & 335000.00 Huanggang Huanggang Pulp production For-profit corporation 14.09 85.91 Establishment 0 0
Paper Co. Ltd.Huanggang Chenming Paper 100000.00 Huanggang Huanggang Paper making For-profit corporation 100 Establishment 0 0
Technology Co. Ltd.Huanggang Chenming Port 5000.00 Huanggang Huanggang Port services For-profit corporation 100 Establishment 0 0
Service Co. Ltd.Hubei Huanggang Chenming 300.00 Huanggang Huanggang Capital market For-profit corporation 60 Establishment 0 0
Equity Investment Fund services
Management Co. Ltd.Hubei Chenming Technology 5000.00 Huanggang Huanggang Paper product For-profit corporation 100 Establishment 0 0
Industrial Co. Ltd. trading
Shandong Chenming Group 500000.00 Jinan Jinan Finance For-profit corporation 80 20 Establishment 0 0
Finance Co. Ltd.SHANDONG CHENMING PAPER HOLDINGS LIMITED 201
INTERIM REPORT 2025VIII Financial Report
X. Interest in Other Entities (Cont’d)
1. Interest in subsidiaries (Cont’d)
(1) Constitution of the Group (Cont’d)
Register Principle Shareholding Issued Issued
capital place of Place of Nature of Type of Direct Indirect debt share
Name of subsidiary (’0000) business incorporation business legal person (%) (%) Acquisition securities capital
Shandong Chenming Financial 587200.00 Jinan Jinan Finance leases For-profit corporation 100 Establishment 0 0
Leasing Co. Ltd.Chenming (HK) Limited 9990.00 (USD) Hong Kong Hong Kong Paper product For-profit corporation 100 Establishment 0 0
trading
Qingdao Chenming Nonghai 500000.00 Qingdao Qingdao Finance leases For-profit corporation 100 Establishment 0 0
Financial Leasing Co. Ltd
Shanghai Chenming Financial 100000.00 Shanghai Shanghai Finance leases For-profit corporation 100 Establishment 0 0
Leasing Co. Ltd.Wuhan Junheng Property 39600.00 Wuhan Wuhan Property For-profit corporation 100 Merger and 0 0
Management Co. Ltd. acquisition
Guangzhou Chenming Property 100000.00 Guangzhou Guangzhou Property For-profit corporation 100 Establishment 0 0
Management Co. Ltd.Shandong Chenming 20000.00 Jinan Jinan Investment For-profit corporation 100 Establishment 0 0
Investment Limited
Shanxi Fuyin Industrial 36000.00 Taiyuan Taiyuan Wholesale and For-profit corporation 100 Acquisition 0 0
Trading Co. Ltd. retail
Chongmin Culture 20000.00 Shanghai Shanghai Lease and For-profit corporation 100 Acquisition 0 0
Development (Shanghai) business
Co. Ltd. services
Jinan Chenming Paper 10000.00 Jinan Jinan Investment For-profit corporation 100 Establishment 0 0
Sales Co. Ltd. management/
Paper product
trading
Shandong Chenming 20000.00 Jinan Jinan Business For-profit corporation 100 Establishment 0 0
Commercial Factoring factoring
Co. Ltd.Chenming GmbH 65.00 (USD) Germany Germany Paper product For-profit corporation 100 Establishment 0 0
trading
Chenming Paper Japan 150.00 (USD) Japan Japan Paper product For-profit corporation 100 Establishment 0 0
Co. Ltd. trading
Chenming Paper United 100.00 (USD) the United the United Paper product For-profit corporation 100 Establishment 0 0
States Co. Ltd. States States trading
Chenming Paper Korea 100.00 (USD) Korea Korea Paper product For-profit corporation 100 Establishment 0 0
Co. Ltd. trading
Chenming (Overseas) 2000.00 (USD) Hong Kong Hong Kong Paper product For-profit corporation 100 Establishment 0 0
Co. Ltd. trading
Chenming (Singapore) 2000.00 (USD) Singapore Singapore Paper product For-profit corporation 100 Establishment 0 0
Co. Ltd. trading
Meilun (BVI) Limited 5.00 (USD) Cayman Cayman Commerce For-profit corporation 100 Establishment 0 0
Shanghai Chenming 370000.00 Shanghai Shanghai Property For-profit corporation 100 Establishment 0 0
Industry Co. Ltd. investment
and
management
Shanghai Chenyin Trading 41000.00 Shanghai Shanghai Trading For-profit corporation 51 Establishment 0 0
Co. Ltd.
202 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
X. Interest in Other Entities (Cont’d)
1. Interest in subsidiaries (Cont’d)
(1) Constitution of the Group (Cont’d)
Register Principle Shareholding Issued Issued
capital place of Place of Nature of Type of Direct Indirect debt share
Name of subsidiary (’0000) business incorporation business legal person (%) (%) Acquisition securities capital
Shanghai Hongtai Real Estate 60391.77 Shanghai Shanghai Real estate For-profit corporation 100 Merger and 0 0
Co. Ltd. acquisition
Shanghai Hongtai Property 200.00 Shanghai Shanghai Property For-profit corporation 100 Merger and 0 0
Management Co. Ltd. acquisition
Shouguang Chenming 200.00 Shouguang Shouguang Machinery For-profit corporation 100 Establishment 0 0
Papermaking Machine manufacturing
Co. Ltd.Shouguang Hongxiang Printing 80.00 Shouguang Shouguang Printing and For-profit corporation 100 Acquisition 0 0
and Packaging Co. Ltd. packaging
Shouguang Chenming Modern 1000.00 Shouguang Shouguang Transportation For-profit corporation 100 Establishment 0 0
Logistic Co. Ltd.Shouguang Hongyi Decorative 200.00 Shouguang Shouguang Packaging For-profit corporation 100 Merger and 0 0
Packaging Co. Ltd. acquisition
Shouguang Xinyuan Coal 300.00 Shouguang Shouguang Coal For-profit corporation 100 Merger and 0 0
Co. Ltd. acquisition
Shouguang City Run Sheng 2380.00 Shouguang Shouguang Purchase and For-profit corporation 100 Merger and 0 0
Wasted Paper Recycle sale of waste acquisition
Co. Ltd.Huanggang Chenming 7000.00 Huanggang Huanggang Arboriculture For-profit corporation 100 Establishment 0 0
Arboriculture Development
Co. Ltd.Chenming Arboriculture 10000.00 Wuhan Wuhan Arboriculture For-profit corporation 100 Establishment 0 0
Co. Ltd.Hailaer Chenming Paper 1600.00 Hailaer Hailaer Paper making For-profit corporation 75 Establishment 0 0
Co. Ltd.Weifang Chenming Growth 100000.00 Weifang Weifang Fund For-profit corporation 79 Establishment 0 0
Driver Replacement
Equity Investment Fund
Partnership (Limited
Partnership)
Weifang Chendu Equity 32000.00 Shouguang Shouguang Capital market For-profit corporation 79.69 Establishment 0 0
Investment Partnership services
(Limited Partnership)
Nanjing Chenming Culture 500.00 Nanjing Nanjing Marketing For-profit corporation 100 Establishment 0 0
Communication Co. Ltd
Shandong Grand View 4192.48 (USD) Shouguang Shouguang Catering For-profit corporation 90.05 Establishment 0 0
Hotel Co. Ltd.Weifang Chenchuang Equity 90300.00 Weifang Weifang Equity For-profit corporation 99.67 Merger and 0 0
Investment Fund Partnership investment acquisition
(Limited Partnership)
(2) Major non-wholly owned subsidiaries
Unit: RMB
Gain or loss Dividend to
attributable to minority minority interest Closing balance
Name of subsidiary Minority interest interest during the period declared during the period of minority interest
Shouguang Meilun Paper Co. Ltd. 13.22 -142204918.84 560742910.47
Zhanjiang Chenming Pulp
& Paper Co. Ltd. 19.72 -166516344.51 1237916095.04
SHANDONG CHENMING PAPER HOLDINGS LIMITED 203
INTERIM REPORT 2025VIII Financial Report
204 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025
X. Interest in Other Entities (Cont’d)
1. Interest in subsidiaries (Cont’d)
(3) Key financial information of major non-wholly owned subsidiaries
Unit: RMB
Closing balance Opening balance
Non-current Non-current Non-current Non-current
Name of subsidiary Current assets assets Total assets Current liabilities liabilities Total liabilities Current assets assets Total assets Current liabilities liabilities Total liabilities
Shouguang Meilun
Paper Co. Ltd. 4195248832.46 9293778715.41 13489027547.87 4958417298.42 1520943312.70 6479360611.12 10198457312.12 9544065823.56 19742523135.68 12006315839.27 7392419.69 12013708258.96
Zhanjiang Chenming
Pulp & Paper
Co. Ltd. 6020572750.81 11817203766.82 17837776517.63 10197756684.31 423769175.04 10621525859.35 8429523936.97 11986351774.32 20415875711.29 11877878416.94 473681057.41 12351559474.35
Unit: RMB
Amount for the period Amount for the prior period
Total Total Cash flows
comprehensive Cash flows from comprehensive from operating
Name of subsidiary Revenue Net profit income operating activities Revenue Net profit income activities
Shouguang Meilun Paper Co. Ltd. 805084480.98 -677427573.67 -677427573.67 22602677.62 4684096701.75 40515254.62 40515254.62 759366495.73
Zhanjiang Chenming Pulp & Paper Co. Ltd. 143191538.56 -844270649.67 -848066136.60 49662737.05 6278830552.25 3686976.50 7359489.89 671266132.58VIII Financial Report
X. Interest in Other Entities (Cont’d)
2. Transaction changing shareholding in but not causing to loss of control over subsidiaries
(1) Changing in shareholding in subsidiaries
Chenming (HK) Limited a subsidiary of the Company acquired additional 25% equity interests of Shouguang
Chenming Art Paper Co. Ltd. a subsidiary of the Company thus the latter became a wholly-owned subsidiary of
the former.
(2) Effect of the transactions on minority interest and equity attributable to the owners of the parent company
Unit: RMB
Shouguang
Chenming Art
Paper Co. Ltd.Cost of acquisition/Disposal consideration 35748442.80
– Cash 35748442.80
– Fair value of non-cash assets
Total cost of acquisition/disposal consideration 35748442.80
Less: Share of net assets of the subsidiary calculated based on the
proportion of equity interest acquired/disposed of 33724049.84
Difference 2024392.96
Including: Capital reserve adjustment -2024392.96
Surplus reserve adjustment
Retained profit adjustment
3. Interest in joint ventures or associates
(1) Major joint ventures and associates
Accounting
method for
investment in
Principle place Place of Nature of Shareholding (%) joint ventures or
Name of joint venture and associate of business incorporation business Direct Indirect associates
Shouguang Jintou Industrial Investment Shouguang Shouguang Investment 49.57 Equity method
Partnership (Limited Partnership)
Guangdong Nanyue Bank Co. Ltd. Guangdong Guangdong Bank 4.46 Equity method
Explanation on shareholding in joint venture or associate differs from corresponding proportion of voting rights:
The basis for holding less than 20% of the voting power but having significant influence or the basis for holding
20% or more of the voting power but not having significant influence:
The Company holds 4.46% equity interest in Guangdong Nanyue Bank Co. Ltd. but is the second largest
shareholder and is able to exercise significant influence over Guangdong Nanyue Bank Co. Ltd. by appointing
one director to the board of directors (out of a total of nine directors on the board of directors).SHANDONG CHENMING PAPER HOLDINGS LIMITED 205
INTERIM REPORT 2025VIII Financial Report
X. Interest in Other Entities (Cont’d)
3. Interest in joint ventures or associates (Cont’d)
(2) Key financial information of major joint ventures
Unit: RMB
Closing balance/ Opening balance/
Shouguang Jintou Industrial Investment Partnership amount for amount for
(Limited Partnership) the period the prior period
Current assets 1085665564.71 1469875783.97
Including: Cash and cash equivalents 2205370.37 11415277.31
Non-current assets 577871311.16 594445221.29
Total assets 1663536875.87 2064321005.26
Current liabilities 196006880.34 257355454.66
Non-current liabilities 21726787.16 22702318.57
Total liabilities 217733667.50 280057773.23
Minority interest 3142297.75 5172055.47
Equity interest attributable to shareholders of the parent company 1442660910.62 1779091176.56
Share of net assets based on shareholding 715118357.43 881884821.67
Adjustments 728530641.20 897206354.89
– Goodwill
– Unrealised profit for internal transaction
– Others 728530641.20 897206354.89
Carrying amount of equity investment in joint ventures 1443648998.63 1779091176.56
Fair value of equity investment in joint ventures with
a quoted price in the open market
Revenue 231186861.32 305986438.14
Finance expenses -60398.70 1809456.02
Income tax expenses -616895.19
Net profit -335442177.93 -19202925.23
Net profit from discontinued operations
Other comprehensive income
Total comprehensive income -335442177.93 -19202925.23
Dividends received from joint ventures during the year
206 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
X. Interest in Other Entities (Cont’d)
3. Interest in joint ventures or associates (Cont’d)
(3) Key financial information of major associates
Unit: RMB
Closing balance/ Opening balance/
amount for amount for the
Guangdong Nanyue Bank Co. Ltd. the period prior period
Current assets 205904302483.07 195708622711.11
Non-current assets 122505121368.61 132561137018.86
Total assets 328409423851.68 328269759729.97
Current liabilities 292687296498.71 273238389155.39
Non-current liabilities 5180358284.57 24657998149.20
Total liabilities 297867654783.28 297896387304.59
Minority interest
Equity interest attributable to shareholders of the parent company 30541769068.40 30373372425.38
Share of net assets based on shareholding 1362162900.45 1354652410.17
Adjustments
– Goodwill
– Unrealised profit for internal transaction
– Others
Carrying amount of equity investment in associates 1362162900.45 1354652410.17
Fair value of equity investment in associates with a quoted
price in the open market
Revenue 1410036732.55 1263828453.62
Net profit 253497246.80 233504987.79
Net profit from discontinued operations
Other comprehensive income -85100603.78 82343349.45
Total comprehensive income 168396643.02 315848337.24
Dividends received from associates during the year
(4) Summary financial information of non-major joint ventures and associates
Unit: RMB
Closing balance/ Opening balance/
amount for amount for the
the period prior period
Joint ventures:
Total carrying amount of investment 179091495.41 192441660.84
Total amount of the following items based on shareholding
– Net profit -13350165.43 10459243.34
– Total comprehensive income -13350165.43 10459243.34
Associates:
Total carrying amount of investment 636362009.62 644850163.97
Total amount of the following items based on shareholding
– Net profit -8488154.35 -40358414.42
– Total comprehensive income -8488154.35 -40358414.42
SHANDONG CHENMING PAPER HOLDINGS LIMITED 207
INTERIM REPORT 2025VIII Financial Report
XI. Government grants
1. Government grants recognised at the end of the reporting period at the amount receivable
□ Applicable √ Not applicable
Reasons for not receiving the estimated amount of government grants at the estimated time
□ Applicable √ Not applicable
2. Liabilities in respect of government grants
√ Applicable □ Not applicable
Unit: RMB
Include in
New grants non-operating Include in other
during the income for the income for Other changes Asset-related/
Item Accounting item Opening balance period period the period for the period Closing balance income-related
Funding for environmental protection Deferred income 478415952.52 25464041.36 452951911.16 Asset-related
Huanggang pulp-forestry-paper project Deferred income 420942087.45 12513108.90 408428978.55 Asset-related
Infrastructure and environmental
protection engineering Deferred income 185285787.80 5758794.74 179526993.06 Asset-related
Financial subsidies for technical
transformation project Deferred income 89417910.72 4666552.48 84751358.24 Asset-related
Zhanjiang forestry-pulp-paper project Deferred income 38522698.43 2047316.46 36475381.97 Asset-related
Project fund for National Key
Technology Research and
Development Program Deferred income 629025.00 82350.00 546675.00 Asset-related
Others Deferred income 27726023.60 843605.04 26882418.56 Asset-related
T otal 1240939485.52 51375768.98 1189563716.54
208 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XI. Government grants (Cont’d)
3. Government grants included in profit or loss for the period
√ Applicable □ Not applicable
Unit: RMB
Amount for Amount for
Item Accounting item the period the prior period
Funding for environmental protection Other income 25474041.36 25239041.36
Huanggang pulp-forestry-paper project Other income 12513108.90 12513108.90
Infrastructure and environmental protection
engineering Other income 5758794.74 5758794.72
Financial subsidies for technological
transformation project Other income 4700763.02 11626552.48
Zhanjiang forestry-pulp-paper project Other income 2113105.92 2047316.46
Enterprise reform and development subsidies Other income 218000.00
Government awards Other income 130000.00 1910920.00
Project fund for National Key Technology Research
and Development Program Other income 82350.00 82350.00
Tax refund Other income 20000.00 30124.00
Employment stabilisation subsidy Other income 2000.00 1227050.37
Afforestation subsidy Other income 39730.53 491960.00
Social security subsidy Other income 46500.00
Others Other income 1504445.92 3327666.75
T otal 52556340.39 64301385.04
SHANDONG CHENMING PAPER HOLDINGS LIMITED 209
INTERIM REPORT 2025VIII Financial Report
XII. Risk relating to financial instruments
Main financial instruments of the Company include monetary funds bills receivable accounts receivable accounts
receivable financing other receivables non-current assets due within one year other current assets financial assets held
for trading other non-current financial assets long-term receivables bills payable accounts payable other payables short-
term borrowings financial liabilities held for trading non-current liabilities due within one year long-term borrowings lease
liabilities and long-term payables. Details of financial instruments refer to related notes. The risks associated with these
financial instruments and the risk management policies adopted by the Company to mitigate these risks are described below.The management of the Company manages and monitors these exposures to ensure that the above risks are controlled in a
limited extent.
1. Various risks from financial instruments
The Company aims to seek the appropriate balance between the risks and benefits in order to mitigate the adverse
effects on the Company’s financial performance from financial risk. Based on such risk management objectives the
Company’s risk management policies are established to identify and analyse the risks faced by the Company to
set appropriate risk limits and devise corresponding internal control procedures and to monitor risks faced by the
Company. Such risk management policies and internal control systems are reviewed regularly to adapt to changes in
market conditions and the Company’s activities. The internal audit department of the Company undertakes both regular
and ad-hoc reviews of risk management controls and procedures.Risks associated with the financial instrument of the Company mainly include credit risk liquidity risk market risk
(including exchange rate risk interest rate risk and commodity price risk).The board of directors is responsible to plan and establish the Company’s risk management structure make risk
management policies and related guidelines and supervise the implementation of risk management. The Company has
already made risk management risks to identify and analyse risks that the Company face. These policies mentioned
specific risks covering market credit risk and liquidity risk etc. The Company regularly assesses market environment
and the operation of the Company changes to determine if to make alteration to risk management policy and systems.The Company’s risk management is implemented by Risk Management Committee according to the approval of the
board of directors. The Risk Management Committee works closely with other business department of the Company to
identify evaluating and avoiding certain risks. The Company’s internal audit department will audit the risk management
control and procedures regularly and report the result to audit committee of the Company.The Company spreads risks through diverse investment and business lines and through making risk management
policy to reduce risks of single industry specific area and counterparty.
(1) Credit risk
Credit risk refers to risk associated with the default of contract obligation of a transaction counterparty resulting in
financial losses to the Company.The Company manages credit risk based category. Credit risks mainly arose from bank deposit bills receivable
accounts receivable other receivables and long-term receivables etc.The Company’s bank deposit mainly deposits in state-owned banks and other large and medium-sized listed
banks. The Company anticipated that the bank deposit does not have significant credit risk.
210 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XII. Risk relating to financial instruments (Cont’d)
1. Various risks from financial instruments (Cont’d)
(1) Credit risk (Cont’d)
For accounts receivables other receivables and long-term receivables the Company set related policies to control
exposure of credit risks. The Company evaluates client’s credit quality and set related credit period based on the
client’s financial status credit records and other factors such as current market situation etc. The Company keeps
monitor the client’s credit record and for client with deteriorate credit records the Company will ensure the credit
risk is under control in whole by means of written notice of payment collection shorten or cancel credit period.The Company’s debtor spread over different industry and area. The Company continued to assess the credit
evaluation to receivables and purchase credit guarantee insurance if necessary.The biggest credit risk exposure of the Company is the carrying amount of each financial asset in the balance
sheet. The Company did not provide financial guarantee which resulted in credit risks.The amount of top 5 accounts receivable of the Company accounted for 45.60% (2024: 39.64%) of the
Company’s total accounts receivables. The amount of top 5 other receivable of the Company accounted for
64.89% (2024: 66.28%) of the Company’s total other receivables.
(2) Liquidity risk
Liquidity risk refers to the risks that the Company will not be able to meet its obligations associated with its
financial liabilities that are settled by delivering cash or other financial assets.To manage the liquidity risk the Company monitors and maintains a level of cash and cash equivalents to finance
the Company’s operations and mitigate the effects of fluctuations in cash flows. The management of the Company
monitors the usage of bank borrowings and ensures compliance with the borrowing agreements. In the meantime
we obtain commitments from major financial institutions to provide sufficient standby funds to meet short-term
and long-term funding needs.Operating cash of the Company was generated from capital and bank and other borrowings. As at 30 June 2025
the Company’s unused bank loan credit was RMB0.00 million (31 December 2024: RMB11176.9188 million
which has been completely frozen and cannot be used). The closing balance of financial assets of the Company
due within one year amounted to RMB12188.7747 million while the closing balance of financial liabilities due
within one year amounted to RMB38621.2220 million. The financial assets due within one year was less than that
of financial liabilities.SHANDONG CHENMING PAPER HOLDINGS LIMITED 211
INTERIM REPORT 2025VIII Financial Report
XII. Risk relating to financial instruments (Cont’d)
1. Various risks from financial instruments (Cont’d)
(2) Liquidity risk (Cont’d)
As at the end of the period the financial assets financial liabilities and off balance sheet guarantee held by the
Company are analysed by their maturity date as below at their remaining undiscounted contractual cash flows (in
RMB’0000):
Closing balance
Item Within 1 year 1 to 2 years 2 to 5 years Over 5 years Total
Financial assets:
Monetary funds 93838.40 93838.40
Financial assets held for trading 3669.24 3669.24
Bills receivable 76500.06 76500.06
Accounts receivable 227192.37 227192.37
Accounts receivable financing 9216.61 9216.61
Other receivables 250601.97 250601.97
Long-term receivables 13105.54 31446.06 1599.69 46151.29
Other non-current financial assets 34426.70 34426.70
Other current assets 82361.92 82361.92
Non-current assets due within one year 475496.90 475496.90
Total financial assets 1218877.47 13105.54 31446.06 36026.39 1299455.46
Financial liabilities: –
Short-term borrowings 2326171.69 2326171.69
Bills payable 10737.00 10737.00
Accounts payable 842690.21 842690.21
Other payables 331190.30 331190.30
Non-current liabilities due within one year 263647.46 263647.46
Other current liabilities 87685.54 87685.54
Long-term borrowings 74602.50 154696.95 140667.81 369967.26
Lease liabilities 284.06 1030.20 3495.09 4809.35
Long-term payables 116112.32 159960.22 1036.72 277109.26
T otal financial liabilities and contingent liabilities 3862122.20 190998.88 315687.37 145199.62 4514008.07
212 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XII. Risk relating to financial instruments (Cont’d)
1. Various risks from financial instruments (Cont’d)
(2) Liquidity risk (Cont’d)
As at the end of the prior year the financial assets financial liabilities and off-balance sheet guarantee held by the
Company are analysed by their maturity date as below at their remaining undiscounted contractual cash flows (in
RMB’0000):
Balance as at the end of the prior year
Item Within 1 year 1 to 2 years 2 to 5 years Over 5 years Total
Financial assets:
Monetary funds 588069.11 588069.11
Financial assets held for trading 3725.93 3725.93
Bills receivable 50660.57 50660.57
Accounts receivable 266836.20 266836.20
Accounts receivable financing 10073.08 10073.08
Other receivables 256175.64 256175.64
Long-term receivables 11281.94 22341.95 1432.04 35055.93
Other non-current financial assets 75103.05 75103.05
Other current assets 88236.02 88236.02
Non-current assets due within one year 491100.90 491100.90
Total financial assets 1754877.45 11281.94 22341.95 76535.09 1865036.43
Financial liabilities:
Short-term borrowings 2675234.73 2675234.73
Bills payable 142391.81 142391.81
Accounts payable 770896.74 770896.74
Other payables 283336.77 283336.77
Non-current liabilities due within one year 160954.54 160954.54
Other current liabilities 286369.42 286369.42
Long-term borrowings 165672.85 109483.19 201032.48 476188.52
Lease liabilities 286.71 1011.20 3615.65 4913.56
Long-term payables 46996.82 34565.33 81562.15
T otal financial liabilities and contingent liabilities 4319184.01 212956.38 145059.72 204648.13 4881848.24
The financial liabilities disclosed above are based on cash flows that are not discounted and may differ from the
carrying amount of the line items of the balance sheet.Maximum guarantee amount for signed guarantee contracts does not represent the amount to be paid.SHANDONG CHENMING PAPER HOLDINGS LIMITED 213
INTERIM REPORT 2025VIII Financial Report
XII. Risk relating to financial instruments (Cont’d)
1. Various risks from financial instruments (Cont’d)
(3) Market risk
Market risk for financial instrument refers to the risk that the fair value or future cash flow of a financial instrument
will be fluctuated due to the changes in market price and includes interest rate risk exchange rate risk and other
price risk.Interest rate risk
Interest rate risk refers to the risk that the fair value or future cash flow of a financial instrument will be fluctuated
due to the floating rate. Interest rate risk arises from recognised interest-bearing financial instrument and
unrecognised financial instrument (e.g. loan commitments).The Company’s interest rate risk arises from long-term interest-bearing liabilities including long-term borrowing
and bonds payable. Financial liabilities issued at floating rate expose the Company to cash flow interest rate
risk. Financial liabilities issued at fixed rate expose the Company to fair value interest rate risk. The Company
determines the relative proportions of its fixed rate and floating rate contracts depending on the prevailing market
conditions and to maintain an appropriate combination of financial instruments at fixed rate and floating rate
through regular reviews and monitors.The Company closely monitors the interest rate position of the Company. The Company did not enter into any
interest rate hedging arrangements. However the management is responsible to monitor the risks of interest
rate and consider to hedge significant interest risk if necessary. Increase in interest rates will increase the cost
of new borrowing and the interest expenses with respect to the Company’s outstanding floating rate interest-
bearing borrowings and therefore could have a material adverse effect on the Company’s financial result. The
management will make adjustments with reference to the latest market conditions. These adjustments may
include enter into interest swap agreement to mitigate its exposure to the interest rate risk.Interest bearing financial instrument held by the Company are as follows (in RMB’0000):
Amount for Amount for
Item the period the prior period
Financial instrument with fixed interest rate
Financial liabilities
Including: Short-term borrowings 2326171.69 2675234.73
Long-term borrowings 369967.26 476188.52
Long-term borrowings due within one year 205873.05 120435.06
Total 2902012.00 3271858.31
Financial instrument with float interest rate
Financial assets
Including: Monetary funds 93598.99 587932.77
Total 93598.99 587932.77
214 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XII. Risk relating to financial instruments (Cont’d)
1. Various risks from financial instruments (Cont’d)
(3) Market risk (Cont’d)
Interest rate risk (Cont’d)
The financial instruments held by the Company at the reporting date expose the Company to fair value interest
rate risk. This sensitivity analysis as above has been determined assuming that the change in interest rates had
occurred at the reporting date and arisen from the recalculation of the above financial instrument issued at new
interest rates. The non-derivative tools issued at floating interest rate held by the Company at the reporting date
expose the Company to cash flow interest rate risk. The effect to the net profit and shareholder’s equity illustrated
in the sensitivity analysis as above is arisen from the effect to the annual estimate amount of interest expenses or
revenue at the floating interest rate. The analysis is performed on the same basis for prior year.Exchange rate risk
Exchange risk refers to the risk that the fair value or future cash flows of a financial instrument will be fluctuated
due to the changes in foreign currency rates. Foreign currency risk arises on financial instruments that are
denominated in a currency other than the functional currency in which they are measured.The principal business of the Company is situated within the PRC and is denominated in RMB. However foreign
exchange risks still exist for the assets and liabilities in foreign currencies and future foreign currency transactions
as recognised by the Company (assets and liabilities in foreign currencies and foreign currency transactions are
mainly denominated in US dollar Euro Hong Kong dollar and Japanese yen).The following table details the financial assets and liabilities held by the Company which denominated in foreign
currencies and amounted to RMB as at 30 June 2025 are as follows (in RMB’0000):
Liabilities denominated in foreign currency Assets denominated in foreign currency
Balance as at the Balance as at the
Item Closing balance end of the prior year Closing balance end of the prior year
USD 58597.43 66705.08 7419.38 42042.69
EUR 3468.36 3838.45 817.06 1044.24
HKD 2.33 143.97
JPY 1.04 727.81 677.92
SGD 2.12
GBP 1.75 1.61
T otal 62066.83 70543.53 8968.33 43912.55
The Company continuously monitors the size of the Group’s foreign currency transactions and foreign currency
assets and liabilities to minimise the foreign exchange risks it faces and for this reason the Company may aim to
avoid foreign exchange risk by signing forward foreign exchange contracts or currency swap contracts.SHANDONG CHENMING PAPER HOLDINGS LIMITED 215
INTERIM REPORT 2025VIII Financial Report
XII. Risk relating to financial instruments (Cont’d)
1. Various risks from financial instruments (Cont’d)
(3) Market risk (Cont’d)
Exchange rate risk (Cont’d)
With other variables unchanged the after-tax effect of the possible reasonable changes in the exchange rate of
foreign currency to RMB on the current profit and loss of the Company is as follows (in RMB’0000):
Increase (decrease) in after-tax profits Amount for the period Amount for th e prior period
Increase in exchange rate of USD 5% -2558.90 5% 1096.52
Decrease in exchange rate of USD -5% 2558.90 -5% -1096.52
Increase in exchange rate of Euro 5% -132.57 5% -137.52
D ecrease in exchange rate of Euro -5% 132.57 -5% 137.52
Other price risks
Other price risks refer to the risk of fluctuations caused by changes in market prices other than exchange rate
risks and interest rate risks whether arising from factors related to a single financial instrument or its issuer or
from factors related to all similar financial instruments traded on the market. Other price risks can stem from
changes in commodity prices stock market indexes equity instrument prices and other risk variables.Listed equity instrument investments held by the Company classified as financial assets held for trading other
non-current financial assets and other equity instrument investments are measured at fair value on the balance
sheet date. Therefore the Company is subject to the risk of changes in the securities market.The Company monitors closely the impact of price changes on the price risk of the Company’s investment in
equity securities. Currently the Company has not taken any measures to avoid other price risks. However the
management is responsible for monitoring other price risks and will consider holding multiple equity securities
portfolios to reduce the price risk of equity securities investment when necessary.With other variables unchanged the after-tax effect of the change of -1.52% (prior year: -15.33%) in equity
securities investment prices on the Company’s current profit and loss and other comprehensive income is as
follows (unit: RMB’0000):
Increase (decrease) in Increase (decrease) in other
after-tax profits comprehensive income
Balance for Balance for Balance for Balance for
Item the period the prior period the period the prior period
Due to the rise in the price of equity securities
investment
Due to the decline in the price of equity securities
investment -56.69 -709.69
216 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XII. Risk relating to financial instruments (Cont’d)
2. Capital management
The objective of the Company’s capital risk management is to safeguard the Company’s ability to continue as a going
concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal
capital structure to reduce the cost of capital.In order to maintain or adjust the capital structure the Company may adjust its financing methods adjust the number
of dividends paid to shareholders return capital to shareholders issue new shares and other equity instruments or
disposes assets to reduce its liabilities.The Company monitors capital on the basis of the gearing ratio. This ratio is calculated as net liabilities divided by total
capital. As at 30 June 2025 the Company’s gearing ratio is 85.93% (31 December 2024: 79.79%).
3. Financial assets
(1) By transfer method
√ Applicable □ Not applicable
Unit: RMB
Nature of financial Amount of financial Confirmation of
Transfer Method assets transferred assets transferred derecognition Basis for derecognition
External transfer Debt receivable 87189645.64 Derecognised Whe re the Company transferred substantially all
of the risks and rewards
Endorsement or discounting Bills receivable 746520575.24 Not derecognised Wh ere the Company retains almost all the risks
and rewards including the risk of default
associated with it
Endorsement or discounting Accounts receivable 616041951.77 Derecognised Wh ere the Company transferred substantially all
financing of the risks and rewards
Total 1449752172.65
SHANDONG CHENMING PAPER HOLDINGS LIMITED 217
INTERIM REPORT 2025VIII Financial Report
XII. Risk relating to financial instruments (Cont’d)
3. Financial assets (Cont’d)
(2) Financial assets derecognised due to transfer
√ Applicable □ Not applicable
Unit: RMB
Method of financial Amount of financial Gains or losses associated
Item assets transfer assets derecognised with derecognition
Debt receivable External transfer 87189645.64 -47189645.64
Accounts receivable financing Endorsement or discounting 616041951.77 -4400687.40
T otal 703231597.41 -51590333.04
XIII. Fair value disclosure
1. Fair value of assets and liabilities measured at fair value as at the end of the period
Unit: RMB
Fair value at the end of the period
Fair value Fair value Fair value
measurements measurements measurements
categorised categorised categorised
I tem into Level 1 into Level 2 into Level 3 Tota l
I. Measurement of fair value on an ongoing basis － － － －
(i) Financial assets held for trading
1. Financial assets measured at fair value 36692409.73 36692409.73
through profit or loss
(1) Investment in equity instruments 36692409.73 36692409.73
(ii) Accounts receivable financing 92166113.62 92166113.62
(iii) Other non-current financial assets 344266989.06 344266989.06
(iv) Biological assets 1098778602.31 1098778602.31
1. Consumable biological assets 1098778602.31 1098778602.31
Total assets measured at fair value on an ongoing basis 36692409.73 1535211704.99 1571904114.72
II. Non-continuous measurement of fair value － － － －
(i) Assets held for trading
Total assets measured at fair value not on an ongoing
basis
Total liabilities measured at fair value not on an ongoing
bas is
218 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XIII. Fair value disclosure (Cont’d)
2. Basis for determining the market value of continuous and non-continuous level 1 fair value measurement
items
For financial assets traded in active markets the Company determines their fair value using quoted prices in active
markets.
3. Qualitative and quantitative information on the valuation techniques used and important parameters for
continuous and non-continuous level 3 fair value measurement items
Fair value as at Range
the end of Valuation (weighted
Item the period techniques Unobservable inputs average)
Consumable biological assets:
Forestry 1098778602.31 Roll back method of Unit price per tonne of RMB500
market price Eucalyptus wood RMB520
Unit price per tonne of RMB500
wet pine
Unit price per tonne of
fir wood
4. Reconciliation of opening and closing book value for continuous level 3 fair value measurement items
and sensitive analysis of unobservable inputs
Unit: RMB
Total profit or loss for the period
Transferred to other
Transfer to Transfer from Transferred to comprehensive
Item (current amount) Opening balance third level third level profit and loss income Closing balance
Accounts receivable financing 100730797.32 8564683.70 92166113.62
Other non-current financial assets 751030454.68 406763465.62 344266989.06
Biological assets: 1256379773.85 28541981.20 -129059190.34 1098778602.31
Consumable biological assets 1256379773.85 28541981.20 -129059190.34 1098778602.31
Total 2108141025.85 443870130.52 -129059190.34 1535211704.99
SHANDONG CHENMING PAPER HOLDINGS LIMITED 219
INTERIM REPORT 2025VIII Financial Report
XIV. Related parties and related party transactions
1. Parent company of the Company
Shareholding Voting right
of the parent of the parent
Place of Registered company in company in
Name of parent company incorporation Business nature capital the Company the Company
Chenming Holdings Co. Ltd. Shouguang Investment in manufacture of 1238787700 27.87% 27.87%
paper electricity steam and
arboriculture
The ultimate controller of the Company is Shouguang State-owned Assets Supervision and Administration Office.Other description: During the reporting period Shandong Shouguang Jinxin Investment Development Holdings Group
Limited the controlling Shareholder of Chenming Holdings transferred its 45.2151% equity interests in Chenming
Holdings to Shouguang Shengming Investment Co. Ltd. a wholly-owned subsidiary of Shouguang State-owned Assets
Supervision and Administration Office at nil consideration. Upon such change Shandong Shouguang Jinxin Investment
Development Holdings Group Limited no long held any equity interest in Chenming Holdings and Shouguang
Shengming Investment Co. Ltd. held 45.2151% equity interests in Chenming Holdings. There is no change in controlling
shareholder and beneficial controller of the Company.
2. Subsidiaries of the Company
For details of the Company’s subsidiaries please refer to Note X. 1.
3. Joint ventures and associates of the Company
For details of material joint ventures and associates of the Company please refer to Note X. 3.Balance of related party transaction between the Company and its joint ventures or associates during the period or prior
periods are as follows:
Name of joint ventures or associates Relation
Weifang Port Wood Chip Wharf Co. Ltd. A joint venture of the Company
Shouguang Meite Environmental Technology Co. Ltd. A joint venture of the Company
Weifang Xingxing United Chemical Co. Ltd. A joint venture of the Company
Shouguang Chenming Huisen New-style A joint venture of the Company
Construction Materials Co. Ltd.Wuhan Chenming Qianneng Electric Power Co. Ltd. A subsidiary of an associate of the Company
Wuhan Chenming Hanyang Paper Holdings Co. Ltd. An associate of the Company
Chenming (Qingdao) Asset Management Co. Ltd. An associate of the Company
Guangdong Nanyue Bank Co. Ltd. An associate of the Company
Xuchang Chenming Paper Co. Ltd. An associate of the Company
220 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XIV. Related parties and related party transactions (Cont’d)
4. Other related parties
Name of other related parties Relation
Shouguang Huixin Construction Materials Co. Ltd. A subsidiary of a company invested by the Directors
and Senior Management of the Company
Lide Technology Co. Ltd. A subsidiary of a company invested by the Directors
and Senior Management of the Company
Shouguang Chenming Guangyuan Real Property A subsidiary of a company invested by
Company Limited the Directors and Senior Management of
the Company
Hu Changqing Li Xingchun Li Weixian Li Feng Han Tingde Key management personnel of the Company
Li Chuanxuan Li Zhihui Sun Jianfei Yin Meiqun Yang Biao
Li Kang Pan Ailing Zhang Hong Qiu Lanju Sang Ailing
Li Zhenzhong Li Mingtang Ge Guangming Dong Lianming
Yuan Xikun and Zhu Hanliang
5. Related party transactions
(1) Purchase and sales of goods and rendering and receiving services
Table on purchase of goods/receiving of services
Unit: RMB
Whether the
Transaction transaction
Subject matter of the Amount for facility facility is Amount for the
Related party related party transactions the period approved exceeded prior period
Weifang Port Wood
Chip Wharf Co. Ltd. Port miscellaneous fees 2333303.83 110000000.00 No 56191147.39
Shouguang Meite
Environmental Purchase of chemical
Technology Co. Ltd. materials N/A N/A 15577072.00
Table on sales of goods/providing of services
Unit: RMB
Subject matter of the Amount for Amount for
Related party related party transactions the period the prior period
Shouguang Chenming Huisen New-style
Construction Materials Co. Ltd. Sales of electricity and steam 6210617.19 6547010.44
Shouguang Huixin Construction
Materials Co. Ltd. Sales of electricity etc. 10948.60 60485.79
Shouguang Meite Environmental
Technology Co. Ltd. Sales of electricity and water 73146.00 2153097.10
SHANDONG CHENMING PAPER HOLDINGS LIMITED 221
INTERIM REPORT 2025VIII Financial Report
XIV. Related parties and related party transactions (Cont’d)
5. Related party transactions (Cont’d)
(2) Related party leasing
The Company as lessor:
Unit: RMB
Lease income Lease income
recognised for recognised for
Name of lessee Type of leased asset the current period the previous period
Shouguang Meite Environmental
Technology Co. Ltd. Housing 733944.96 733944.95
Chenming (Qingdao) Asset Management
Co. Ltd. Housing and building structure 506019.39
L ide Technology Co. Ltd. Housing and building structure 331694.20 949010.43
(3) Related party guarantee
The Company as guarantor
Unit: RMB
Whether
Commencement performance
Amount date of Expiry date of guarantee
Party being guaranteed under guarantee guarantee of guarantee is completed
Chenming (HK) Limited 7044710.83 2025/5/7 2025/8/5 No
Chenming (HK) Limited 5642635.81 2025/5/15 2025/8/13 No
Chenming (HK) Limited 3237178.77 2025/6/3 2025/9/1 No
Chenming (HK) Limited 6776215.86 2025/6/6 2025/9/4 No
Chenming (HK) Limited 3534889.19 2025/6/23 2025/9/22 No
Chenming (HK) Limited 37744590.49 2024/1/4 2030/1/3 No
Chenming (HK) Limited 11779933.35 2024/8/16 2024/11/18 No
Chenming (HK) Limited 18388628.02 2024/9/14 2024/12/20 No
Chenming (HK) Limited 8145612.86 2024/9/30 2024/12/11 No
Chenming (HK) Limited 20832335.70 2024/8/23 2024/11/22 No
Chenming (HK) Limited 19427086.97 2024/7/26 2024/11/27 No
Hainan Chenming Technology Co. Ltd. 50000000.00 2024/4/10 2025/4/7 No
Hainan Chenming Technology Co. Ltd. 50500000.00 2024/11/27 2025/11/26 No
Hainan Chenming Technology Co. Ltd. 19500000.00 2024/11/28 2025/11/27 No
Hainan Chenming Technology Co. Ltd. 50000000.00 2025/1/16 2026/1/16 No
Hainan Chenming Technology Co. Ltd. 8400000.00 2025/1/2 2025/7/2 No
Hainan Chenming Technology Co. Ltd. 126000000.00 2025/3/28 2026/3/28 No
Hainan Chenming Technology Co. Ltd. 39600000.00 2025/6/10 2026/6/10 No
Hainan Chenming Technology Co. Ltd. 59737111.20 2024/10/15 2025/4/14 No
Hainan Chenming Technology Co. Ltd. 49671.39 2024/12/26 2025/6/26 No
222 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XIV. Related parties and related party transactions (Cont’d)
5. Related party transactions (Cont’d)
(3) Related party guarantee (Cont’d)
Whether
Commencement performance
Amount date of Expiry date of guarantee
Party being guaranteed under guarantee guarantee of guarantee is completed
Hainan Chenming Technology Co. Ltd. 49621717.52 2024/12/30 2025/6/30 No
Huanggang Chenming Pulp & Paper Co. Ltd. 20000000.00 2025/4/28 2026/4/27 No
Huanggang Chenming Pulp & Paper Co. Ltd. 90000000.00 2025/5/20 2026/5/19 No
Huanggang Chenming Pulp & Paper Co. Ltd. 30000000.00 2024/7/19 2025/7/18 No
Huanggang Chenming Pulp & Paper Co. Ltd. 45000000.00 2024/8/14 2025/8/13 No
Huanggang Chenming Pulp & Paper Co. Ltd. 50000000.00 2024/9/23 2025/9/13 No
Huanggang Chenming Pulp & Paper Co. Ltd. 30000000.00 2024/10/18 2025/10/18 No
Huanggang Chenming Pulp & Paper Co. Ltd. 14000000.00 2024/8/1 2025/7/29 No
Huanggang Chenming Pulp & Paper Co. Ltd. 15995000.00 2024/9/14 2025/9/12 No
Huanggang Chenming Pulp & Paper Co. Ltd. 753640000.00 2019/12/16 2031/12/15 No
Huanggang Chenming Pulp & Paper Co. Ltd. 68000000.00 2025/4/25 2027/12/5 No
Huanggang Chenming Pulp & Paper Co. Ltd. 74485646.20 2025/2/28 2027/9/28 No
Huanggang Chenming Pulp & Paper Co. Ltd. 98000000.00 2022/5/20 2026/10/27 No
Huanggang Chenming Pulp & Paper Co. Ltd. 43993016.93 2022/11/30 2028/2/25 No
Huanggang Chenming Pulp & Paper Co. Ltd. 19760595.47 2023/1/12 2027/4/24 No
Huanggang Chenming Pulp & Paper Co. Ltd. 30000000.00 2023/3/9 2026/3/9 No
Huanggang Chenming Pulp & Paper Co. Ltd. 43769402.86 2023/4/24 2026/12/10 No
Huanggang Chenming Pulp & Paper Co. Ltd. 18330147.76 2023/5/10 2026/4/15 No
Huanggang Chenming Pulp & Paper Co. Ltd. 120365399.49 2023/7/18 2027/11/15 No
Huanggang Chenming Pulp & Paper Co. Ltd. 65000000.00 2023/11/23 2027/11/23 No
Huanggang Chenming Pulp & Paper Co. Ltd. 78761534.18 2024/1/30 2028/1/30 No
Jilin Chenming Pulp & Fiber Trading Co. Ltd. 10000000.00 2024/9/24 2025/9/24 No
Jilin Chenming Paper Co. Ltd. 15000000.00 2024/6/19 2026/6/15 No
Jilin Chenming Paper Co. Ltd. 35000000.00 2024/7/24 2025/1/21 No
Jilin Chenming Paper Co. Ltd. 15000000.00 2024/9/10 2025/3/10 No
Jilin Chenming Paper Co. Ltd. 180000000.00 2023/12/15 2025/12/15 No
Jilin Chenming Paper Co. Ltd. 89500000.00 2024/9/29 2026/9/28 No
Jilin Chenming Paper Co. Ltd. 60000000.00 2025/1/17 2027/1/9 No
Jilin Chenming Paper Co. Ltd. 119750000.00 2025/1/20 2027/1/9 No
Jilin Chenming Paper Co. Ltd. 34762798.40 2024/10/15 2025/4/15 No
Jiangxi Chenming Paper Co. Ltd. 10000000.00 2024/10/31 2025/10/27 No
Jiangxi Chenming Paper Co. Ltd. 10000000.00 2024/6/7 2025/6/3 No
Jiangxi Chenming Paper Co. Ltd. 30000000.00 2024/6/11 2025/6/9 No
Jiangxi Chenming Paper Co. Ltd. 30000000.00 2024/6/17 2025/6/13 No
Jiangxi Chenming Paper Co. Ltd. 10000000.00 2024/6/18 2025/6/16 No
Jiangxi Chenming Paper Co. Ltd. 16000000.00 2024/6/21 2025/6/17 No
Jiangxi Chenming Paper Co. Ltd. 10000000.00 2024/6/24 2025/6/20 No
Jiangxi Chenming Paper Co. Ltd. 100000000.00 2024/7/5 2025/7/1 No
Jiangxi Chenming Paper Co. Ltd. 10000000.00 2024/8/30 2025/8/26 No
Jiangxi Chenming Paper Co. Ltd. 200000000.00 2024/7/2 2025/7/1 No
Jiangxi Chenming Paper Co. Ltd. 200000000.00 2024/5/31 2025/11/29 No
Jiangxi Chenming Paper Co. Ltd. 250000000.00 2024/6/13 2025/12/12 No
Jiangxi Chenming Paper Co. Ltd. 50000000.00 2024/7/2 2025/12/31 No
SHANDONG CHENMING PAPER HOLDINGS LIMITED 223
INTERIM REPORT 2025VIII Financial Report
XIV. Related parties and related party transactions (Cont’d)
5. Related party transactions (Cont’d)
(3) Related party guarantee (Cont’d)
Whether
Commencement performance
Amount date of Expiry date of guarantee
Party being guaranteed under guarantee guarantee of guarantee is completed
Jiangxi Chenming Paper Co. Ltd. 1300000.00 2024/9/29 2025/9/24 No
Jiangxi Chenming Paper Co. Ltd. 2000000.00 2025/1/27 2026/1/26 No
Jiangxi Chenming Paper Co. Ltd. 91200000.00 2025/2/13 2026/1/26 No
Jiangxi Chenming Paper Co. Ltd. 29000000.00 2025/2/26 2026/2/14 No
Jiangxi Chenming Paper Co. Ltd. 50000000.00 2025/3/5 2026/3/5 No
Jiangxi Chenming Paper Co. Ltd. 70000000.00 2025/3/18 2026/3/18 No
Jiangxi Chenming Paper Co. Ltd. 80000000.00 2025/3/19 2026/3/19 No
Jiangxi Chenming Paper Co. Ltd. 2008854.97 2025/4/23 2026/2/14 No
Jiangxi Chenming Paper Co. Ltd. 1289794.55 2025/4/23 2026/1/26 No
Jiangxi Chenming Paper Co. Ltd. 1050948.10 2025/4/23 2026/4/23 No
Jiangxi Chenming Paper Co. Ltd. 5000000.00 2025/5/26 2026/5/26 No
Jiangxi Chenming Paper Co. Ltd. 17000000.00 2025/6/11 2026/6/11 No
Jiangxi Chenming Paper Co. Ltd. 19545000.00 2024/12/13 2025/11/30 No
Jiangxi Chenming Paper Co. Ltd. 20000000.00 2024/12/16 2025/11/30 No
Jiangxi Chenming Paper Co. Ltd. 20000000.00 2024/12/18 2025/11/30 No
Jiangxi Chenming Paper Co. Ltd. 3500000.00 2024/12/19 2025/11/30 No
Jiangxi Chenming Paper Co. Ltd. 6500000.00 2024/12/25 2025/11/30 No
Jiangxi Chenming Paper Co. Ltd. 193419000.00 2025/2/21 2026/2/20 No
Jiangxi Chenming Paper Co. Ltd. 70000000.00 2025/4/24 2026/4/23 No
Jiangxi Chenming Paper Co. Ltd. 19959366.67 2025/4/3 2026/1/26 No
Jiangxi Chenming Paper Co. Ltd. 59748619.03 2025/4/8 2026/1/26 No
Jiangxi Chenming Paper Co. Ltd. 10000000.00 2023/11/15 2024/11/15 No
Jiangxi Chenming Paper Co. Ltd. 19800000.00 2025/5/22 2026/5/21 No
Jiangxi Chenming Paper Co. Ltd. 19800000.00 2025/5/23 2026/5/22 No
Jiangxi Chenming Paper Co. Ltd. 20350000.00 2025/6/27 2026/5/20 No
Jiangxi Chenming Paper Co. Ltd. 30000000.00 2023/9/8 2026/8/22 No
Jiangxi Chenming Paper Co. Ltd. 57600000.00 2024/9/29 2026/3/29 No
Jiangxi Chenming Paper Co. Ltd. 106975661.00 2022/2/28 2028/2/28 No
Jiangxi Chenming Paper Co. Ltd. 8971781.19 2022/4/1 2025/4/1 No
Jiangxi Chenming Paper Co. Ltd. 79835042.81 2022/5/23 2026/12/15 No
Jiangxi Chenming Paper Co. Ltd. 11259827.27 2022/8/18 2026/7/24 No
Jiangxi Chenming Paper Co. Ltd. 5000000.00 2022/10/11 2025/10/11 No
Jiangxi Chenming Paper Co. Ltd. 15334938.09 2023/12/4 2027/10/15 No
Jiangxi Chenming Paper Co. Ltd. 30000000.00 2024/10/17 2027/10/17 No
Jiangxi Chenming Paper Co. Ltd. 39999702.50 2024/4/30 2026/10/29 No
Shandong Chenming Pulp & Paper Sales Co. Ltd. 150000000.00 2024/2/8 2025/2/12 No
Shandong Chenming Pulp & Paper Sales Co. Ltd. 203370000.00 2024/8/14 2025/8/15 No
Shandong Chenming Pulp & Paper Sales Co. Ltd. 100000000.00 2024/9/9 2025/9/10 No
Shandong Chenming Pulp & Paper Sales Co. Ltd. 32680000.00 2024/9/19 2025/9/19 No
Shandong Chenming Pulp & Paper Sales Co. Ltd. 50000000.00 2024/9/24 2025/9/23 No
Shandong Chenming Pulp & Paper Sales Co. Ltd. 153820000.00 2024/10/9 2025/10/10 No
Shandong Chenming Pulp & Paper Sales Co. Ltd. 400000000.00 2025/3/29 2026/3/24 No
Shandong Chenming Pulp & Paper Sales Co. Ltd. 25000000.00 2025/3/26 2026/3/25 No
224 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XIV. Related parties and related party transactions (Cont’d)
5. Related party transactions (Cont’d)
(3) Related party guarantee (Cont’d)
Whether
Commencement performance
Amount date of Expiry date of guarantee
Party being guaranteed under guarantee guarantee of guarantee is completed
Shandong Chenming Pulp & Paper Sales Co. Ltd. 50000000.00 2025/3/27 2026/3/26 No
Shandong Chenming Pulp & Paper Sales Co. Ltd. 75000000.00 2025/3/31 2026/3/30 No
Shandong Chenming Pulp & Paper Sales Co. Ltd. 130000000.00 2025/4/2 2026/4/1 No
Shandong Chenming Pulp & Paper Sales Co. Ltd. 128402137.00 2025/4/2 2026/4/1 No
Shandong Chenming Pulp & Paper Sales Co. Ltd. 101549733.00 2025/4/7 2026/4/6 No
Shanghai Chenming Pulp & Paper Sales Co. Ltd. 8996196.18 2023/2/13 2026/2/12 No
Shanghai Chenming Pulp & Paper Sales Co. Ltd. 13300000.00 2025/2/28 2028/2/27 No
Shanghai Chenming Pulp & Paper Sales Co. Ltd. 520000000.00 2024/10/18 2029/9/24 No
Shanghai Chenming Pulp & Paper Sales Co. Ltd. 5600000.00 2024/6/4 2025/5/30 No
Shanghai Chenming Pulp & Paper Sales Co. Ltd. 6300000.00 2024/6/14 2025/6/9 No
Shanghai Chenming Pulp & Paper Sales Co. Ltd. 5600000.00 2024/6/20 2025/5/28 No
Shanghai Chenming Pulp & Paper Sales Co. Ltd. 20000000.00 2024/6/21 2025/6/18 No
Shanghai Heruiming Property Management
Co. Ltd. 20000000.00 2025/4/2 2025/9/30 No
Shanghai Heruiming Property Management
Co. Ltd. 59980000.00 2024/5/23 2024/11/8 No
Shanghai Hongtai Property Management
Co. Ltd. 1999545455.00 2023/6/9 2038/3/20 No
Shouguang Chenming Import and Export
Trade Co. Ltd. 90000000.00 2024/12/16 2025/12/15 No
Shouguang Chenming Import and Export
Trade Co. Ltd. 30000000.00 2025/6/27 2028/6/23 No
Shouguang Chenming Import and Export
Trade Co. Ltd. 50000000.00 2024/9/30 2025/3/28 No
Shouguang Chenming Import and Export
Trade Co. Ltd. 31179628.93 2024/8/25 2024/11/25 No
Shouguang Chenming Import and Export
Trade Co. Ltd. 72595822.02 2024/8/26 2024/11/25 No
Shouguang Chenming Import and Export
Trade Co. Ltd. 31892669.52 2024/9/24 2024/12/25 No
Shouguang Chenming Import and Export
Trade Co. Ltd. 90959280.79 2024/9/26 2024/12/25 No
Shouguang Chenming Import and Export
Trade Co. Ltd. 28842694.68 2024/10/27 2025/1/25 No
Shouguang Chenming Import and Export
Trade Co. Ltd. 44522892.05 2024/10/28 2025/1/25 No
Shouguang Meilun Paper Co. Ltd. 91760000.00 2024/7/25 2025/7/25 No
Shouguang Meilun Paper Co. Ltd. 10000000.00 2024/12/27 2025/12/26 No
Shouguang Meilun Paper Co. Ltd. 20000000.00 2025/2/27 2026/2/26 No
Shouguang Meilun Paper Co. Ltd. 56044826.00 2025/5/28 2026/5/27 No
Shouguang Meilun Paper Co. Ltd. 176546779.00 2025/6/25 2026/6/24 No
Shouguang Meilun Paper Co. Ltd. 45727471.00 2025/6/3 2026/6/2 No
Shouguang Meilun Paper Co. Ltd. 98114605.00 2025/6/5 2026/6/4 No
SHANDONG CHENMING PAPER HOLDINGS LIMITED 225
INTERIM REPORT 2025VIII Financial Report
XIV. Related parties and related party transactions (Cont’d)
5. Related party transactions (Cont’d)
(3) Related party guarantee (Cont’d)
Whether
Commencement performance
Amount date of Expiry date of guarantee
Party being guaranteed under guarantee guarantee of guarantee is completed
Shouguang Meilun Paper Co. Ltd. 133253598.00 2024/12/13 2025/12/12 No
Shouguang Meilun Paper Co. Ltd. 49497280.00 2024/12/16 2025/12/15 No
Shouguang Meilun Paper Co. Ltd. 93998400.00 2025/1/8 2026/1/7 No
Shouguang Meilun Paper Co. Ltd. 25113500.00 2025/1/15 2026/1/14 No
Shouguang Meilun Paper Co. Ltd. 44000000.00 2025/1/22 2026/1/21 No
Shouguang Meilun Paper Co. Ltd. 59900000.00 2025/2/7 2026/2/6 No
Shouguang Meilun Paper Co. Ltd. 30000000.00 2024/7/23 2025/7/23 No
Shouguang Meilun Paper Co. Ltd. 71649000.00 2023/10/23 2024/10/23 No
Shouguang Meilun Paper Co. Ltd. 199457641.66 2024/12/12 2025/11/12 No
Shouguang Meilun Paper Co. Ltd. 43000000.00 2024/12/9 2025/12/8 No
Shouguang Meilun Paper Co. Ltd. 10000000.00 2024/12/9 2025/12/9 No
Shouguang Meilun Paper Co. Ltd. 10000000.00 2024/12/9 2025/12/9 No
Shouguang Meilun Paper Co. Ltd. 70000000.00 2025/1/2 2025/7/1 No
Shouguang Meilun Paper Co. Ltd. 270000000.00 2021/9/9 2029/12/20 No
Shouguang Meilun Paper Co. Ltd. 17907687.59 2021/12/14 2025/12/14 No
Shouguang Meilun Paper Co. Ltd. 3387491.97 2021/12/20 2025/12/20 No
Shouguang Meilun Paper Co. Ltd. 162119849.15 2022/3/14 2029/5/25 No
Shouguang Meilun Paper Co. Ltd. 8850506.04 2022/5/24 2027/4/30 No
Shouguang Meilun Paper Co. Ltd. 14345230.30 2022/6/6 2025/6/5 No
Shouguang Meilun Paper Co. Ltd. 21399530.65 2022/6/28 2026/6/28 No
Shouguang Meilun Paper Co. Ltd. 30000000.00 2022/8/25 2025/8/25 No
Shouguang Meilun Paper Co. Ltd. 21466666.64 2022/9/30 2026/12/15 No
Shouguang Meilun Paper Co. Ltd. 109591059.28 2022/11/25 2028/1/15 No
Shouguang Meilun Paper Co. Ltd. 194000000.00 2022/12/27 2027/12/24 No
Shouguang Meilun Paper Co. Ltd. 6574948.25 2022/12/29 2024/12/29 No
Shouguang Meilun Paper Co. Ltd. 12000000.00 2023/1/18 2027/1/18 No
Shouguang Meilun Paper Co. Ltd. 5000000.00 2023/3/29 2026/12/20 No
Shouguang Meilun Paper Co. Ltd. 115000000.00 2023/6/9 2030/9/20 No
Shouguang Meilun Paper Co. Ltd. 15900000.00 2024/12/5 2025/12/5 No
Shouguang Meilun Paper Co. Ltd. 34420409.16 2023/8/30 2028/4/5 No
Shouguang Meilun Paper Co. Ltd. 16878745.04 2023/10/8 2026/5/15 No
Shouguang Meilun Paper Co. Ltd. 42974114.02 2023/10/25 2027/9/25 No
Shouguang Meilun Paper Co. Ltd. 499500000.00 2024/1/18 2029/1/18 No
Shouguang Meilun Paper Co. Ltd. 42278885.85 2024/1/29 2027/1/28 No
Shouguang Meilun Paper Co. Ltd. 25446656.28 2024/4/12 2025/4/12 No
Shouguang Meilun Paper Co. Ltd. 46166000.35 2024/5/24 2028/11/24 No
Shouguang Meilun Paper Co. Ltd. 69240954.05 2024/5/28 2028/5/26 No
Shouguang Meilun Paper Co. Ltd. 27000000.00 2024/6/28 2027/6/28 No
Shouguang Meilun Paper Co. Ltd. 53427551.13 2024/7/5 2028/2/15 No
Shouguang Meilun Paper Co. Ltd. 9500000.00 2024/7/11 2026/7/11 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 85500000.00 2023/11/29 2024/11/21 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 100000000.00 2023/12/9 2025/12/8 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 100000000.00 2024/1/3 2026/1/2 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 38000000.00 2024/3/21 2026/3/20 No
226 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XIV. Related parties and related party transactions (Cont’d)
5. Related party transactions (Cont’d)
(3) Related party guarantee (Cont’d)
Whether
Commencement performance
Amount date of Expiry date of guarantee
Party being guaranteed under guarantee guarantee of guarantee is completed
Zhanjiang Chenming Pulp & Paper Co. Ltd. 10500000.00 2024/3/26 2025/3/26 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 31000000.00 2024/3/28 2026/3/27 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 30000000.00 2024/3/29 2026/3/27 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 25000000.00 2024/5/16 2026/5/15 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 75770782.44 2024/5/23 2024/11/26 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 45000000.00 2024/5/29 2026/5/28 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 63000000.00 2024/5/31 2026/5/27 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 40000000.00 2024/6/6 2026/6/5 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 38372000.00 2024/6/6 2026/5/28 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 47784000.00 2024/6/6 2026/5/27 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 48000000.00 2024/6/26 2026/6/23 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 62000000.00 2024/6/28 2026/6/24 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 200000000.00 2024/7/12 2025/7/11 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 29000000.00 2024/7/18 2025/7/17 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 100000000.00 2024/7/23 2025/7/22 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 67000000.00 2024/7/24 2025/7/22 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 41408350.00 2024/7/24 2025/7/22 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 60000000.00 2024/8/7 2025/8/6 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 59000000.00 2024/8/8 2025/8/7 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 67000000.00 2024/8/14 2025/8/13 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 100000000.00 2024/9/25 2025/9/24 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 78000000.00 2024/10/10 2025/10/10 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 62000000.00 2024/10/11 2025/4/10 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 109960000.00 2024/10/15 2025/10/14 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 730401.44 2024/10/17 2025/1/16 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 167500000.00 2024/11/11 2025/11/10 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 6000000.00 2024/11/13 2025/5/12 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 100200000.00 2024/11/14 2025/11/13 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 59460000.00 2024/11/20 2025/11/19 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 14050000.00 2025/1/3 2025/7/2 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 204970000.00 2025/3/29 2025/9/28 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 45670000.00 2025/3/29 2025/9/28 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 129910000.00 2025/3/31 2025/9/30 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 5000000.00 2025/3/10 2026/3/9 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 40000000.00 2025/3/10 2026/3/9 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 39900000.00 2025/3/10 2026/3/9 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 67000000.00 2025/1/3 2025/7/3 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 65000000.00 2025/1/10 2025/7/10 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 35250000.00 2025/1/2 2025/12/25 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 35250000.00 2025/1/3 2025/12/25 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 25000000.00 2025/3/31 2026/3/30 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 25290000.00 2025/3/31 2026/3/30 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 13800000.00 2025/4/28 2025/10/27 No
SHANDONG CHENMING PAPER HOLDINGS LIMITED 227
INTERIM REPORT 2025VIII Financial Report
XIV. Related parties and related party transactions (Cont’d)
5. Related party transactions (Cont’d)
(3) Related party guarantee (Cont’d)
Whether
Commencement performance
Amount date of Expiry date of guarantee
Party being guaranteed under guarantee guarantee of guarantee is completed
Zhanjiang Chenming Pulp & Paper Co. Ltd. 50290000.00 2025/4/28 2026/4/27 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 50000000.00 2025/4/28 2026/4/27 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 48700000.00 2025/4/29 2026/4/27 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 60000000.00 2025/5/21 2026/5/20 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 98350000.00 2025/5/20 2026/5/19 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 49505526.00 2025/5/26 2026/5/25 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 494474.00 2025/5/28 2026/5/27 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 47500000.00 2025/6/17 2026/6/16 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 35000000.00 2025/6/18 2026/6/17 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 30000000.00 2025/6/18 2026/6/17 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 4630000.00 2025/6/20 2026/6/20 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 12300000.00 2025/6/23 2026/6/23 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 50000000.00 2024/9/12 2025/1/12 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 50000000.00 2024/9/20 2025/1/17 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 940000000.00 2018/3/26 2029/3/25 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 130000000.00 2022/6/17 2025/6/16 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 275000000.00 2016/8/18 2028/3/13 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 65000000.00 2024/8/14 2025/2/14 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 58940000.00 2024/6/27 2024/12/27 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 70000000.00 2024/6/27 2024/12/27 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 26620000.00 2024/6/28 2024/12/28 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 25000000.00 2024/6/28 2024/12/28 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 69440000.00 2024/6/28 2024/12/28 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 30000000.00 2024/7/2 2025/1/2 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 60540260.41 2022/6/29 2028/6/29 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 51000000.00 2023/3/31 2026/3/29 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 60000000.00 2023/6/2 2026/6/2 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 60900191.21 2023/6/20 2026/6/20 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 200000000.00 2023/7/12 2026/10/12 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 164172110.17 2023/11/8 2029/11/8 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 100000000.00 2024/4/29 2026/6/27 No
Zhanjiang Chenming Pulp & Paper Co. Ltd. 50000000.00 2024/9/13 2029/3/13 No
Zhanjiang Chenming Arboriculture
Development Co. Ltd. 44160000.00 2024/3/29 2026/3/27 No
Weifang Port Wood Chip Wharf Co. Ltd. 78400000.00 2017/12/15 2027/12/20 No
Total 18988318386.68
228 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XIV. Related parties and related party transactions (Cont’d)
5. Related party transactions (Cont’d)
(4) Related party asset transfer and debt restructuring
Unit: RMB
Subject matter of Amount for Amount for
Related party the related party transactions the period the prior period
Shouguang Chenming Tra nsfer of 90.05% equity interest in Yujing 162992813.25
Guangyuan Real Property Hotel to Guangyuan Real Property from
Company Limited Shandong Chenming
Shouguang Chenming Tr ansfer of the debts of Yujing Hotel to 193507186.75
Guangyuan Real Property Guangyuan Real Property from Shandong
Company Limited Chenming
6. Related party accounts receivable and accounts payable
(1) Accounts receivable
Unit: RMB
Closing balance Opening balance
I tem Related party Book balance Bad debts provision Book balance Bad debts provision
Accounts receivable Shouguang Huixin Construction 11976.60 199.27
Materials Co. Ltd.Accounts receivable Shouguang Chenming Huisen 1251335.97 113033.23 903414.15 6323.90
New-style Construction
Materials Co. Ltd.Accounts receivable Lide Technology Co. Ltd. 171451.91 1200.16
Accounts receivable Shouguang Chenming Guangyuan 1718094.65 31269.32 870685.06 6094.80
Property Management Co. Ltd.Other receivables Wuhan Chenming Hanyang 177971333.66 12172722.42 238093358.44 13523702.76
Paper Holdings Co. Ltd.Other receivables Shouguang Meite Environmental 11596023.49 10488539.35 11179201.88 5603487.91
Technology Co. Ltd.Other receivables Weifang Port Wood Chip Wharf 81298249.84 39598310.64 79397749.84 12131778.23
Co. Ltd.Other receivables Shouguang Chenming Guangyuan 27012.00 1350.20 22000.00 1100.00
Real Property Company Limited
SHANDONG CHENMING PAPER HOLDINGS LIMITED 229
INTERIM REPORT 2025VIII Financial Report
XIV. Related parties and related party transactions (Cont’d)
6. Related party accounts receivable and accounts payable (Cont’d)
(2) Accounts payable
Unit: RMB
Closing book Opening book
Item Related party balance balance
Accounts payable Wuhan Chenming Qianneng Electric Power Co. Ltd. 4869.10 4869.10
Accounts payable Wuhan Chenming Hanyang Paper Holdings Co. Ltd. 13921249.12 13921249.12
Accounts payable Weifang Xingxing United Chemical Co. Ltd. 26905494.34 26905494.34
Accounts payable Weifang Port Wood Chip Wharf Co. Ltd. 19117830.71 22610306.71
Accounts payable Shouguang Meite Environmental Technology Co. Ltd. 15292739.96 15292739.96
Accounts payable Shouguang Huixin Construction Materials Co. Ltd. 42929.24
Other payables Wuhan Chenming Hanyang Paper Holdings Co. Ltd. 289394.98 5194879.89
Other payables Lide Technology Co. Ltd. 211618.15 559897.05
Other payables Chenming (Qingdao) Asset Management Co. Ltd. 1806000.00
Other payables Chenming Holdings Co. Ltd. 36839810.01 38500000.00
Other payables Weifang Xingxing United Chemical Co. Ltd. 16860000.00 16860000.00
Other payables Shouguang Chenming Guangyuan Real Property 199125847.35 197714644.82
Company Limited
(3) Deposits with related parties
Unit: RMB
Closing book Opening book
Item Related party balance balance
Bank deposit Guangdong Nanyue Bank Co. Ltd. 1.06 1891614.39
O ther monetary funds G uangdong Nanyue Bank Co. Ltd. 2166246.87 87600000.00
(4) Loans from related parties
Unit: RMB
Closing book Opening book
Item Related party balance balance
S hort-term borrowings G uangdong Nanyue Bank Co. Ltd. 760290000.00 857890000.00
XV. Undertaking and contingency
1. Significant commitments
(1) Capital commitments
Unit: RMB
Capital commitments contracted for but not yet necessary to Balance as at the
be recognised in the financial statement Closing balance end of the prior year
Commitments in relation to acquisition and
construction of long-term assets 294241260.20 298488760.20
230 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XV. Undertaking and contingency (Cont’d)
2. Contingency
(1) Significant contingencies as at the balance sheet date
Contingent liabilities arising from pending litigation and arbitration and their financial impacts
Unit: RMB
Amount of
the subject
Plaintiff Defendant Cause of action Trial to be heard matter Case status
Guangdong Nanyue Bank Zhanjiang Chenming Litigation filed by the Intermediate 452700000.00 Second instance
Co. Ltd. Haitang Sub- Pulp & Paper Co. plaintiff for default People’s Court appeal against
branch Ltd. and Shandong on repayment of of Zhanjiang City the first instance
Chenming Paper borrowings ruling
Holdings Limited
Guodu Venture Capital Shandong Chenming Litigation filed by the People’s Court 63706000.00 Pending first
Co. Ltd. Paper Holdings plaintiff for the non- of Dongcheng instance ruling
Limited payment of equity District Beijing
transfer payment
Hangzhou Changbao Shandong Chenming Litigation filed by the Fuyang District 15200000.00 Under second
Agricultural Technology Paper Holdings plaintiff for default People’s Court instance trial
Co. Ltd. Limited and on repayment of of Hangzhou
Shouguang Meilun borrowings and non- City
Paper Co. Ltd. payment of commercial
paper upon maturity
Industrial Bank Co. Ltd. Jilin Chenming Paper Litigation filed by the Changyi District 35050000.00 Pending second
Jilin Branch Co. Ltd. and plaintiff for the non- People’s Court instance ruling
Shandong Chenming payment of advance of Jilin City
Paper Holdings payments
Limited
Ganzhou Gongfa Jiangxi Chenming Paper Litigation filed by the People’s Court 30010000.00 Under first instance
Financial Co. Ltd. Shandong plaintiff for the non- of Ganzhou trial
Leasing Co. Ltd. Chenming Paper payment of rent Economic &
Holdings Limited and overdue under financial Technological
Shandong Chenming leasing Development
Pulp & Paper Sales Zone
Co. Ltd.Jilin Ruihong Shandong Chenming Litigation filed by the Changyi District 10372800.00 Pending first
Environmental Paper Holdings plaintiff for the non- People’s Court instance trial
Protection Technology Limited payment of commercial of Jilin City
Development Co. Ltd. paper upon maturity
Chengdu Si Di Ou Trading Shandong Chenming Litigation filed by the High Court of 13448000.00 Pending retrial
Co. Ltd. Paper Holdings plaintiff for default Sichuan
Limited on repayment of Province
borrowings
SHANDONG CHENMING PAPER HOLDINGS LIMITED 231
INTERIM REPORT 2025VIII Financial Report
XV. Undertaking and contingency (Cont’d)
2. Contingency (Cont’d)
(1) Significant contingencies as at the balance sheet date (Cont’d)
Contingent liabilities arising from pending litigation and arbitration and their financial impacts (Cont’d)
Amount of
the subject
Plaintiff Defendant Cause of action Trial to be heard matter Case status
Ligen Financial Leasing Zhanjiang Chenming Litigation filed by the Tianhe District 65289000.00 Pending first
Co. Ltd. Pulp & Paper Co. plaintiff for the non- People’s Court instance trial
Ltd. Shandong payment of rent of Guangzhou
Chenming Paper overdue under financial City
Holdings Limited and leasing
Guangzhou Chenming
Property Management
Co. Ltd.Qingdao Beifang Senhua Shandong Chenming Litigation filed by the Huangdao District 31150000.00 Pending first
Technology Co. Ltd. Paper Holdings plaintiff for default People’s Court instance ruling
Limited and Shanghai on repayment of of Qingdao
Chenming Pulp & borrowings
Paper Sales Co. Ltd.Beijing Chuanfa Shandong Chenming Litigation filed by the Third Intermediate 405134700.00 Under first instance
Investment Paper Holdings plaintiff for the non- People’s Court trial
Management Co. Ltd. Limited and Zhanjiang payment of equity of Beijing City
Chenming Pulp & transfer payment
Paper Co. Ltd.Hangzhou Chengtou Shandong Chenming Litigation filed by the Shangcheng 47786326.97 Under first instance
Industrial Co. Ltd. Paper Holdings plaintiff for default on District People’s trial
Limited and Zhanjiang repayment of overdue Court of
Chenming Pulp & payment for goods Hangzhou City
Paper Co. Ltd.Licheng County Guoxin Shandong Chenming Litigation filed by the Shouguang City 16000000.00 Under first instance
Energy and Coal Paper Holdings plaintiff for default People’s Court trial
Transportation Co. Limited on repayment of
Ltd. borrowings
Xiamen Port Haiheng Shandong Chenming Litigation filed by the Huli District 81754000.00 Pending first
(Hong Kong) Limited Paper Holdings plaintiff for default on People’s Court instance trial
Limited and Chenming repayment of overdue of Xiamen City
(HK) Limited payment for goods
Shanghai Branch of Bank Shandong Chenming Litigation filed by the Jingan District 20300000.00 Pending first
of Nanjing Co. Ltd. Paper Holdings plaintiff for default People’s Court instance trial
Limited and Shanghai on repayment of of Shanghai
Chenming Pulp & borrowings
Paper Sales Co. Ltd.Village Committee of Shandong Chenming Litigation filed by the Qingzhou City 11879000.00 Pending first
Beikoubu Village Paper Holdings plaintiff for land People’s Court instance ruling
Heguan Town Limited and infringement
Qingzhou City Shouguang Meilun
Paper Co. Ltd.
232 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XV. Undertaking and contingency (Cont’d)
2. Contingency (Cont’d)
(1) Significant contingencies as at the balance sheet date (Cont’d)
Contingent liabilities arising from pending litigation and arbitration and their financial impacts (Cont’d)
Amount of
the subject
Plaintiff Defendant Cause of action Trial to be heard matter Case status
Qingdao Guosheng Shandong Chenming Litigation filed by the Shibei District 29217800.00 Pending first
Financing Leasing Co. Paper Holdings plaintiff for the non- People’s Court instance ruling
Ltd. Limited and payment of rent of Qingdao City
Shouguang Meilun overdue under financial
Paper Co. Ltd. leasing
Chengfa Group (Qingdao) Shandong Chenming Litigation filed by the Huangdao District 14835300.00 Under first instance
Financial Leasing Co. Paper Holdings plaintiff for the non- People’s Court trial
Ltd. Limited and payment of rent of Qingdao
Shouguang Meilun overdue under financial
Paper Co. Ltd. leasing
Luchuan County Yizhong Zhanjiang Chenming Litigation filed by the Luchuan County 15670000.00 Pending first
Building Materials Co. Pulp & Paper Co. Ltd. plaintiff for the non- People’s Court instance ruling
Ltd. payment of overdue
payment for goods
and commercial paper
upon maturity
Industrial Bank Co. Ltd. Zhanjiang Chenming Litigation filed by the Intermediate 269880000.00 Pending first
Zhanjiang Branch Pulp & Paper Co. plaintiff for default People’s Court instance ruling
Ltd. and Shandong on repayment of of Zhanjiang City
Chenming Paper borrowings
Holdings Limited
Hezhou Renhe Powder Zhanjiang Chenming Litigation filed by the Mazhang District 32367058.83 Under first instance
Co. Ltd. Pulp & Paper Co. Ltd. plaintiff for the non- People’s Court trial
payment of commercial of Zhanjiang City
paper upon maturity
Jinkailin Biotechology Zhanjiang Chenming Litigation filed by the Mazhang District 10731828.93 Pending first
(Shenzhen) Co. Ltd. Pulp & Paper Co. Ltd. plaintiff for default on People’s Court instance ruling
repayment of overdue of Zhanjiang City
payment for goods
Bank of Communications Zhanjiang Chenming Litigation filed by the Intermediate 394529036.28 Under first instance
Co. Ltd. Zhanjiang Pulp & Paper Co. plaintiff for default People’s Court trial
Branch Ltd. and Shandong on repayment of of Zhanjiang City
Chenming Paper borrowings
Holdings Limited
Guangdong Guangwu Zhanjiang Chenming Litigation filed by the Tianhe District 53561000.00 Pending first
Financial Leasing Co. Pulp & Paper Co. plaintiff for the non- People’s Court instance trial
Ltd. Ltd. and Shandong payment of rent of Guangzhou
Chenming Paper overdue under financial City
Holdings Limited leasing
Jiangxi Baorui Trading Jiangxi Chenming Paper Litigation filed by the Jingkai District 11047705.68 Under first instance
Co. Ltd. Co. Ltd. plaintiff for default on People’s Court trial
repayment of overdue of Nanchang
payment for goods
SHANDONG CHENMING PAPER HOLDINGS LIMITED 233
INTERIM REPORT 2025VIII Financial Report
XV. Undertaking and contingency (Cont’d)
2. Contingency (Cont’d)
(1) Significant contingencies as at the balance sheet date (Cont’d)
Contingent liabilities arising from pending litigation and arbitration and their financial impacts (Cont’d)
Amount of
the subject
Plaintiff Defendant Cause of action Trial to be heard matter Case status
Wenjing Financial Leasing Jiangxi Chenming Paper Litigation filed by the Yanta District 18192900.00 Under first instance
(Shenzhen) Co. Ltd. Co. Ltd. plaintiff for the non- People’s Court trial
payment of rent of Xian City
overdue under financial
leasing
Shanghai Greenland Chongmin Culture Litigation filed by the Minhang District 39998000.00 Pending first
Construction (Group) Development plaintiff for the People’s Court instance ruling
Co. Ltd. (Shanghai) Co. Ltd. non-payment of of Shanghai
overdue payment for Municipality
engineering
Shanghai Yingmeng Shanghai Hongtai Litigation filed by the Hongkou District 93887000.00 Pending first
Century Business Property Management plaintiff in relation to People’s Court instance ruling
Management Co. Ltd. Co. Ltd. lease rental dispute of Shanghai
Municipality
Sichuan Nanchong Port Shandong Chenming Litigation filed by the Shouguang City 84770000.00 Pending second
Co. Ltd. Pulp & Paper Sales plaintiff for the non- People’s Court instance ruling
Co. Ltd. payment of overdue
payment for goods
Minsheng Bank Shandong Chenming Litigation filed by the Beijing Financial 200005000.00 Second instance
Weigongcun Sub- Pulp & Paper plaintiff for the non- Court appeal against
branch Sales Co. Ltd. and payment of advance the first instance
Shandong Chenming payments of the letter ruling
Paper Holdings of credit
Limited
Guangdong Golden Shandong Chenming Litigation filed by the Shouguang City 38945000.00 Under first instance
Leaf Supply Chain Pulp & Paper Sales plaintiff for the non- People’s Court trial
Management Co. Ltd. Co. Ltd. payment of commercial
paper upon maturity
Guangdong Nanyue Bank Chongmin Culture Litigation filed by the Intermediate 454981535.39 Second instance
Co. Ltd. Haitang Sub- Development plaintiff for default People’s Court appeal against
branch (Shanghai) Co. Ltd. on repayment of of Zhanjiang City the first instance
and Shanxi Fuyin borrowings ruling
Industrial Trading Co.Ltd
Hezhou Yufeng Powder Shouguang Chenming Litigation filed by the Shouguang City 37500000.00 Under first instance
Co. Ltd. Import and Export plaintiff for the non- People’s Court trial
Trade Co. Ltd. payment of commercial
paper upon maturity
Total 3099898992.08
(2) Description should also be made even the Company did not have any significant contingency that should be
disclosed
The Company did not have any significant contingency that should be disclosed.
234 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XVI. Post-balance sheet event
1. Description of post-balance sheet event
Unit: RMB
Amount of
the subject
Plaintiff Defendant Cause of action Trial to be heard matter Case status
Qingdao Xinhaihe Shandong Chenming Litigation filed by the Shouguang City 25690858.42 Pending first
International Logistics Paper Holdings Limited plaintiff for default on People’s Court instance trial
Co. Ltd. Shouguang Meilun Paper settlement of bank
Co. Ltd. Shouguang acceptance
Chenming Art Paper Co.Ltd. and Shouguang
Chenming Import and
Export Trade Co. Ltd.Weifang Port Wood Chip Shandong Chenming Litigation filed by the Dongying Court of 37605006.03 Under first instance
Wharf Co. Ltd. Paper Holdings Limited plaintiff for default Qingdao Maritime trial
Shouguang Meilun Paper on payment for port Court
Co. Ltd. and Shouguang operational fees
Chenming Import and
Export Trade Co. Ltd.Haicheng No. 2 Talc Shandong Chenming Paper Litigation filed by the Intermediate People’s 11790833.33 Under first instance
Powder Factory Co. Holdings Limited and plaintiff for default on Court of Anshan trial
Ltd. Shandong Chenming repayment of interest of City
Pulp & Paper Sales Co. borrowings
Ltd.Hainan Hengsheng Zhanjiang Chenming Pulp & Litigation filed by the Shouguang City 76881000.00 Pending first
Forestry Co. Ltd. Paper Co. Ltd. plaintiff for default on People’s Court instance trial
overdue payment for
goods
Zhanjiang Chengbo Zhanjiang Chenming Pulp & Litigation filed by the Shouguang City 36260000.00 Pending first
Trading Co. Ltd. Paper Co. Ltd. plaintiff for default on People’s Court instance trial
overdue payment for
goods
Junneng Chemicals Shandong Chenming Paper Litigation filed by the Longnan City People’s 33000000.00 Pending first
(Longnan) Co. Ltd. Holdings Limited plaintiff for default on Court instance trial
repayment of borrowings
Beijing Kairui Fengchi Shandong Chenming Paper Litigation filed by the People’s Court of 50000000.00 Pending first
Technology Co. Ltd. Holdings Limited and plaintiff for default on Zhaoyang District instance trial
Shandong Chenming repayment of borrowings Beijing
Pulp & Paper Sales Co.Ltd.Tianyuan Zhanjiang Chenming Litigation filed by Mazhang District 32477344.50 Pending first
Construction Pulp & Paper Co. the plaintiff for the People’s Court instance trial
Group Co. Ltd. Ltd. non-payment of of Zhanjiang
overdue payment City
for engineering
T otal 599148876.66
SHANDONG CHENMING PAPER HOLDINGS LIMITED 235
INTERIM REPORT 2025VIII Financial Report
XVII. Other Material Matters
1. Debt restructuring
The Company will take the initiative to communicate with its creditors for extension of loan terms and reduction of
interest rates so as to alleviating the pressure on loan repayment in the short term. Provincial debt committees were
established to agree on no loan cancellations or delays and further negotiate new credit facilities in the form of a
syndicated loan specifically for resumption of operation and production and interest rate reductions and extensions of
debts to ensure sufficient liquidity for operations and production resumption of the Company.
2. Segment information
(1) Basis for determination and accounting policies
According to the Company’s internal organisational structure management requirements and internal reporting
system the Company’s operating business is divided into 4 reporting segments. These report segments are
determined based on the financial information required by the company’s daily internal management. The
management of the Group regularly evaluates the operating results of these reporting segments to determine the
allocation of resources to them and evaluate their performance.The Company’s reporting segments include:
(1) Machine paper segment which is responsible for production and sales of machine paper;
(2) Financial services segment which provides financial services;
(3) Hotels and property rentals segment which is responsible for hotel services and property rental;
(4) Other segments which is responsible for the above segments otherwise.
The transfer prices of the transfer transactions between the Company’s segments are based on market prices.Segment report information is disclosed in accordance with the accounting policies and measurement standards
adopted by each segment when reporting to management. These accounting policies and measurement basis are
consistent with the accounting policies and measurement basis used in preparing the financial statements.
236 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XVII. Other Material Matters (Cont’d)
2. Segment information (Cont’d)
(2) Financial Information of Reporting Segment
Unit: RMB
Prior period or end of Hotel and
the prior period Machine-made paper Financial services property rentals Others Inter-segment offset Total
Revenue 2096607431.51 13735689.19 77747530.70 152887636.60 234347335.70 2106630952.30
Including: Revenue from
external transactions 2000620515.50 6768845.62 73535359.10 25706232.08 2106630952.30
Revenue from inter-segment
transactions 95986916.00 6966843.57 4212171.60 127181404.53 234347335.70
Including: Revenue from
principal activities 1960971896.72 13735689.19 77586979.03 54856951.30 41331737.38 2065819778.86
Operating costs 3705644549.40 47250059.70 54148182.74 190064791.38 269903862.98 3727203720.24
Including: Costs of principal
activities 3569248994.99 47250059.70 54145481.18 95503717.95 71239446.70 3694908807.12
Operating expenses 39623382.17 11008838.79 481045.60 51113266.56
Including: Wages 26575047.42 2923618.29 334267.80 29832933.51
Depreciation expenses 475762.16 1837757.30 2313519.46
Office expenses 145986.33 5629.65 151615.98
Travel expenses 3139715.36 1200.00 92483.28 3233398.64
Selling commissions 1001014.52 1001014.52
Rental expenses 1638731.24 42452.83 1681184.07
Hospitality expenses 3179225.99 2022.00 3181247.99
Others 4468913.67 5237597.03 11841.69 9718352.39
Operating profit/(loss) -2932459732.71 -627086713.44 -286893588.65 -190530590.51 118967242.60 -4155937867.91
Total assets 66037623450.04 4808401859.62 8211991814.24 7191664533.98 31550805666.14 54698875991.74
Total liabilities 51681098606.14 2913758796.62 5370138518.52 2137995564.76 15099169545.59 47003821940.45
Fixed assets purchased 15240983.50 161934.94 331675.53 58377.27 15792971.24
Construction in progress
purchased 17398698.59 3152428.23 20551126.82
SHANDONG CHENMING PAPER HOLDINGS LIMITED 237
INTERIM REPORT 2025VIII Financial Report
XVII. Other Material Matters (Cont’d)
3. Others
(1) In the case of the equity financing business dispute between Chenming Holdings (Hong Kong) Limited (hereinafter
referred to as “Chenming Holdings (Hong Kong)”)a wholly-owned subsidiary of Chenming Holdings Company
Limited (hereinafter referred to as “Chenming Holdings”) and three overseas institutions (hereinafter referred to
as “Lenders”) over the Company’s 210.72 million B shares (representing 7.16% of the total share capital of the
Company) and 153.41 million H shares (representing 5.22% of the total share capital of the Company) Chenming
Holdings (Hong Kong) had appointed counsel to take litigation and arbitration measures in the courts of the
relevant jurisdictions.On 28 June 2024 Chenming Holdings (Hong Kong) filed a complaint with the New York Court of the United
States. On 29 October 2024 the New York Court of the United States held a pre-trial conference and ordered that
the plaintiffs and the defendant must complete two rounds of cross-examinations before 28 February 2025.On 22 November 2024 Chenming Holdings (Hong Kong) filed an amended complaint with the US court; and
on 15 February 2025 it filed a reply to the defendant’s defence pending further instructions from the court on
subsequent procedures.As of the date of this announcement Chenming Holdings is actively safeguarding its legitimate rights and interests
via legal means
There is a risk that the shares involved may not be returned which may result in a decrease in the percentage of
shareholding of Chenming Holdings in the Company but will have no impact on the status of Chenming Holdings
as the largest shareholder and will have no impact on the control of the Company.
(2) On 14 June 2022 the Hong Kong Court of Final Appeal handed down its judgment in the case of H-share
liquidation filed by ArjowigginsHKK2Limited (“HKK2 Company”) in relation to the Company’s Joint Venture dispute
and the Company has paid the relevant amount of compensation.On 25 October 2022 the Company instructed its legal adviser in Hong Kong to apply to the Court of First Instance
to seek the dismissal or adjournment of the winding-up petition filed by HKK2 against the Company On 25 July
2023 the Court of First Instance held a hearing on the said application.
On 10 August 2023 the Company received a judgment from the judge of the Court of First Instance Mr. Justice
Harris which ruled that the winding-up petition be stayed given that the Company’s arbitration petition filed
in the Hong Kong International Arbitration Centre in June 2022 against the Joint Venture Contracts formed the
basis of the Company’s cross claim against HKK2 in the winding-up proceedings. The relevant arbitration hearing
was heard at the Hong Kong International Arbitration Centre in May 2024. At present the parties have reached a
settlement and the case has been concluded.
238 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XVIII. Major Item Notes of the Parent Company’s Financial Statements
1. Bills receivable
Unit: RMB
Balance as
at the end of
Category Closing balance the prior year
Bank acceptance bills 356030.64 243662966.17
Commercial acceptance bills 31837164.39
Total 356030.64 275500130.56
(1) Bills receivable pledged by the Company as at the end of the period
There was no pledged bank acceptance bills accounted for bills receivable as at the end of the period.
(2) Bills receivable endorsed or discounted but not yet due as at the end of the period
Unit: RMB
Amount Amount not yet
derecognised derecognised
as at the end as at the end of
Item of the period the period
Bank acceptance bills 14790550.08
Commercial acceptance bills
Total 14790550.08
2. Accounts receivable
(1) Disclosure by ageing
Unit: RMB
Closing book Opening book
Ageing balance balance
Within 1 year 2129920914.09 240828735.48
1 to 2 years 189054.07
2 to 3 years 1500000.00
Over 3 years 4502821.17 3002821.17
Subtotal 2134612789.33 245331556.65
Less: Bad debts provision 4601067.27 4543616.41
T otal 2130011722.06 240787940.24
SHANDONG CHENMING PAPER HOLDINGS LIMITED 239
INTERIM REPORT 2025VIII Financial Report
XVIII. Major Item Notes of the Parent Company’s Financial Statements (Cont’d)
2. Accounts receivable (Cont’d)
(2) Disclosure by bad debt provision method
Unit: RMB
Closing balance Opening balance
Book balance Bad debts provision Book balance Bad debts provision
Provision Provision
Percentage percentage Percentage percentage
C ategory Amount (%) Amount (%) Book value Amount (%) Amount (%) Book value
Accounts receivable assessed
individually for bad debt provision
Accounts receivable assessed
collectively for bad debt provision 2134612789.33 100.00 4601067.27 0.22 2130011722.06 245331556.65 100.00 4543616.41 1.85 240787940.24
Including:
Due from related parties 2117656711.19 99.21 2117656711.19 225768022.18 92.03 5370.25 225762651.93
Due from non-related parties 16956078.14 0.79 4601067.27 27.14 12355010.87 19563534.47 7.97 4538246.16 23.20 15025288.31
T otal 2134612789.33 100.00 4601067.27 0.22 2130011722.06 245331556.65 100.00 4543616.41 1.85 240787940.24
Number of categories of items assessed collectively for bad debt provision: 2
Items assessed collectively for bad debt provision: Due from related party customers
Unit: RMB
Closing balance
Bad debts Provision
Name Book balance provision percentage
W ithin 1 year 2117656711.19
T otal 2117656711.19
Items assessed collectively for bad debt provision: Due from non-related party customers
Unit: RMB
Closing balance
Bad debts Provision
Name Book balance provision percentage
Within 1 year 12264202.90 40755.66 0.33
1 to 2 years 189054.07 57490.44 30.41
2 to 3 years
Over 3 years 4502821.17 4502821.17 100.00
T otal 16956078.14 4601067.27
If the bad debt provision of accounts receivable is made in accordance with the general model of ECLs:
□ Applicable √ Not applicable
240 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XVIII. Major Item Notes of the Parent Company’s Financial Statements (Cont’d)
2. Accounts receivable (Cont’d)
(3) Provision recovery or reversal of bad debt provision for the period
Bad debt provision for the period:
Unit: RMB
Changes in the period
Opening Recovery Closing
Category balance Provision or reversal Written-off Others balance
B ad debts provision 4543616.41 59118.60 1667.74 4601067.27
T otal 4543616.41 59118.60 1667.74 4601067.27
(4) Top five accounts receivable and contract assets based on closing balance of debtors
The total amount of top five accounts receivable and contract assets based on closing balance of debtors for
the period amounted to RMB2122128114.09 in total accounting for 99.43% of the total closing balance of
accounts receivable and contract assets. The closing balance of the corresponding bad debt provision amounted
to RMB4463355.65 in total.Unit: RMB
As a percentage Closing balance
of the closing of bad debt
Closing balance balance of provision
of accounts the total accounts of accounts
Name of entity receivable receivable receivable
Shandong Chenming Pulp & Paper
Sales Co. Ltd. 1034397471.09 48.46
Shandong Chenming Paper Sales Co. Ltd. 618295998.82 28.97
Chenming (HK) Limited 462747841.28 21.68
Shouguang Hongxuan Trading Co. Ltd. 4422600.00 0.21 4422600.00
Shandong Hengxin Thermoelectric Co. Ltd. 2264202.90 0.11 40755.65
T otal 2122128114.09 99.43 4463355.65
SHANDONG CHENMING PAPER HOLDINGS LIMITED 241
INTERIM REPORT 2025VIII Financial Report
XVIII. Major Item Notes of the Parent Company’s Financial Statements (Cont’d)
3. Other receivables
Unit: RMB
Item Closing balance Opening balance
Dividend receivable 142500000.00
Other receivables 5586347164.46 8459731199.92
T otal 5728847164.46 8459731199.92
(1) Dividend receivable
1) Classification of dividends receivable
Unit: RMB
Item (or investee) Closing balance Opening balance
Shouguang Chenming Art Paper Co. Ltd. 142500000.00
Total 142500000.00
(2) Other receivables
1) Classification of other receivables by nature
Unit: RMB
Closing book Opening book
Nature balance balance
Open credit 5687616036.37 8539141510.67
Guarantee deposit and deposit 4313950.00 820000.00
Reserve and borrowings 10829299.16 13009976.80
Others 1849080.15 1150970.20
Subtotal 5704608365.68 8554122457.67
Bad debts provision 118261201.22 94391257.75
T otal 5586347164.46 8459731199.92
242 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XVIII. Major Item Notes of the Parent Company’s Financial Statements (Cont’d)
3. Other receivables (Cont’d)
(2) Other receivables (Cont’d)
2) Disclosure by ageing
Unit: RMB
Closing book Opening book
Ageing balance balance
Within 1 year (including 1 year) 5549662351.87 8439577689.53
1 to 2 years 48096165.01 8767733.14
2 to 3 years 9277585.30 41423849.01
Over 3 years 97572263.50 64353185.99
Subtotal 5704608365.68 8554122457.67
Bad debts provision 118261201.22 94391257.75
Total 5586347164.46 8459731199.92
3) Disclosure by bad debt provision method
Unit: RMB
Closing balance Opening balance
Book balance Bad debts provision Book balance Bad debts provision
Provision Provision
Percentage percentage Percentage percentage
Category Amount (%) Amount (%) Book value Amount (%) Amount (%) Book value
Assessed individually for
bad debt provision 69617968.36 1.22 64201610.01 92.22 5416358.35 68711903.60 0.80 67461188.30 98.18 1250715.30
Assessed collectively for
bad debt provision 5634990397.32 98.78 54059591.21 0.96 5580930806.11 8485410554.07 99.20 26930069.45 0.32 8458480484.62
Including:
Due from government
authorities 4721797.07 0.08 249597.97 5.29 4472199.10 5408443.96 0.06 319526.28 5.91 5088917.68
Due from related parties 5617189799.51 98.47 51781184.46 0.92 5565408615.05 8462533948.96 98.93 25662066.54 0.30 8436871882.42
Other receivables 13078800.74 0.23 2028808.78 15.51 11049991.96 17468161.15 0.21 948476.63 5.43 16519684.52
Total 5704608365.68 100.00 118261201.22 2.07 5586347164.46 8554122457.67 100.00 94391257.75 1.10 8459731199.92
SHANDONG CHENMING PAPER HOLDINGS LIMITED 243
INTERIM REPORT 2025VIII Financial Report
XVIII. Major Item Notes of the Parent Company’s Financial Statements (Cont’d)
3. Other receivables (Cont’d)
(2) Other receivables (Cont’d)
3) Disclosure by bad debt provision method (Cont’d)
Items assessed individually for bad debt provision:
Unit: RMB
Closing balance
Provision
Bad debts percentage
Name Book balance provision (%) Provision reason
Valmet of Finland 5526048.24 5526048.24 100.00 Uncertain recovery
to a certain extent
Metso Paper-Making Machinery 4725039.89 4725039.89 100.00 Uncertain recovery
(China) Co. Ltd. to a certain extent
Andritz 4019935.23 4019935.23 100.00 Uncertain recovery
to a certain extent
Zhengzhou Shunfa Coal 2871239.32 2871239.32 100.00 Uncertain recovery
Distribution Co. Ltd. to a certain extent
Shanghai Xiaotai Decoration 2844459.53 2844459.53 100.00 Uncertain recovery
Design and Engineering to a certain extent
Co. Ltd.Ahlstrom of Finland 2820742.72 2820742.72 100.00 Uncertain recovery
to a certain extent
HAO HUNG COMPANY LTD. 2650339.91 2650339.91 100.00 Uncertain recovery
to a certain extent
Voith of Germany 2615790.98 2615790.98 100.00 Uncertain recovery
to a certain extent
Remaining 21 customers 41544372.54 36128014.19 86.96 Uncertain recovery
to a certain extent
Total 69617968.36 64201610.01 92.22
244 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XVIII. Major Item Notes of the Parent Company’s Financial Statements (Cont’d)
3. Other receivables (Cont’d)
(2) Other receivables (Cont’d)
3) Disclosure by bad debt provision method (Cont’d)
Bad debt provision based on the general model of ECLs:
Unit: RMB
Stage 1 Stage 2 Stage 3
ECLs for the Lifetime ECLs Lifetime ECLs
Bad debts provision next 12 months (not credit-impaired) (credit-impaired) Total
Balance as at 1 January 2025 26930069.45 67461188.30 94391257.75
Balance as at 1 January 2025 for the period
– Transferred to stage 2
– Transferred to stage 3
– Reversed to stage 2
– Reversed to stage 1
Provision for the period 29063713.24 29063713.24
Reversal for the period 1934191.48 3259578.29 5193769.77
Transfer for the period
Write-off for the period
Other changes
B alance as at 30 June 2025 54059591.21 64201610.01 118261201.22
Changes in carrying book balances with significant changes in loss provision for the period
□ Applicable √ Not applicable
4) Provision recovery or reversal of bad debt provision for the period
Bad debt provision for the period:
Unit: RMB
Changes in the period
Opening Recovery Transfer or
Category balance Provision or reversal written-off Others Closing balance
Other receivables 94391257.75 29063713.24 5193769.77 118261201.22
T otal 94391257.75 29063713.24 5193769.77 118261201.22
SHANDONG CHENMING PAPER HOLDINGS LIMITED 245
INTERIM REPORT 2025VIII Financial Report
XVIII. Major Item Notes of the Parent Company’s Financial Statements (Cont’d)
3. Other receivables (Cont’d)
(2) Other receivables (Cont’d)
5) Top five accounts receivable based on closing balance of debtors
The total amount of top five other receivables based on closing balance of debtors for the period amounted
to RMB3973568788.21 in total accounting for 69.65% of the total closing balance of other receivables.The closing balance of the corresponding bad debt provision amounted to RMB0.00 in total.Unit: RMB
Percentage
to total closing Closing balance
balance of other of bad debt
Name of entity Nature Closing balance Ageing receivables (%) provision
Shanghai Chenming Financial Leasing Open credit 1365763375.17 Within 1 year 23.94
Co. Ltd.Shandong Chenming Commercial Open credit 1272731938.36 Within 1 year 22.31
Factoring Co. Ltd.Shandong Chenming Financial Leasing Open credit 820837649.98 Within 1 year 14.39
Co. Ltd.Shanghai Heruiming Property Open credit 264235824.70 Within 1 year 4.63
Management Co. Ltd.Chenming (Overseas) Co. Ltd. Open credit 250000000.00 Within 1 year 4.38
T otal 3973568788.21 69.65
4. Long-term equity investments
Unit: RMB
Closing balance Opening balance
Impairment Impairment
Item Book balance provision Book value Book balance provision Book value
Investment in subsidiaries 16449918234.42 16449918234.42 18327937687.22 18327937687.22
I nvestment in associates and joint ventures 259825513.98 5994545.96 253830968.02 265229792.71 5994545.96 259235246.75
T otal 16709743748.40 5994545.96 16703749202.44 18593167479.93 5994545.96 18587172933.97
246 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XVIII. Major Item Notes of the Parent Company’s Financial Statements (Cont’d)
4. Long-term equity investments (Cont’d)
(1) Investment in subsidiaries
Unit: RMB
Opening Change for the period Closing
balance of balance of
Opening balance impairment Additional Withdrawn Impairment Closing balance impairment
Investee (carrying amount) provision contribution contribution provision Others (carrying amount) provision
Chenming Paper Korea Co. Ltd. 6143400.00 6143400.00
Chenming GmbH 4083235.00 4083235.00
Hailaer Chenming Paper Co. Ltd. 12000000.00 12000000.00
Huanggang Chenming Pulp &
Paper Co. Ltd. 2350000000.00 1878019452.80 471980547.20
Huanggang Chenming Arboriculture
Development Co. Ltd. 70000000.00 70000000.00
Jinan Chenming Investment
Management Co. Ltd. 100000000.00 100000000.00
Shandong Grand View Hotel Co. Ltd. 280500000.00 280500000.00
Zhanjiang Chenming Pulp & Paper Co. Ltd. 5275000000.00 5275000000.00
Shouguang Chenming Modern
Logistic Co. Ltd. 10000000.00 10000000.00
Shouguang Chenming Art Paper Co. Ltd. 113616063.80 113616063.80
Shouguang Meilun Paper Co. Ltd. 4949441979.31 4949441979.31
Shouguang Chenming Import and
Export Trade Co. Ltd. 250000000.00 250000000.00
Shouguang Chenming Papermaking
Machine Co. Ltd. 2000000.00 2000000.00
Shouguang Hongxiang Printing and
Packaging Co. Ltd. 3730000.00 3730000.00
Shandong Chenming Group
Finance Co. Ltd. 4000000000.00 4000000000.00
Chenming Arboriculture Co. Ltd. 45000000.00 45000000.00
Chenming Paper United States Co. Ltd. 6407800.00 6407800.00
Weifang Chenming Growth Driver
Replacement Equity Investment Fund
Partnership (Limited Partnership) 559722323.96 559722323.96
Weifang Chendu Equity Investment
Partnership (Limited Partnership) 290292885.15 290292885.15
Total 18327937687.22 1878019452.80 16449918234.42
SHANDONG CHENMING PAPER HOLDINGS LIMITED 247
INTERIM REPORT 2025VIII Financial Report
XVIII. Major Item Notes of the Parent Company’s Financial Statements (Cont’d)
4. Long-term equity investments (Cont’d)
(2) Investment in associates and joint ventures
Unit: RMB
Change for the period
Investment Distribution
Opening gain or loss Adjustment Other of cash Closing Closing
Opening balance of recognised of other change dividend balance balance of
balance impairment Additional Withdrawn under equity comprehensive in equity or profit Impairment (carrying impairment
Investee (carrying amount) provision contribution contribution method income interest declared provision Others amount) provision
I. Joint ventures
Zhuhai Dechen New
Third Board Equity
Investment Fund
Company (Limited
Partnership) 27167682.31 -3636926.80 23530755.51
Ningbo Kaichen
Huamei Equity
Investment Fund
Partnership (Limited
Partnership) 135554820.00 8867943.33 144422763.33
Chenming (Qingdao)
Asset Management
Co. Ltd. 826793.21 245037.23 1071830.44
Xuchang Chenming
Paper Co. Ltd. 5994545.96 5994545.96
Subtotal 163549295.52 5994545.96 5476053.76 169025349.28 5994545.96
II. Associates
Shouguang Chenming
Huisen New-style
Construction Materials
Co. Ltd. 8368935.72 -454469.59 7914466.13
Weifang Port Wood
Chip Wharf Co. Ltd. 87317015.51 -10425862.90 76891152.61
Subtotal 95685951.23 -10880332.49 84805618.74
Total 259235246.75 5994545.96 -5404278.73 253830968.02 5994545.96
Determination of net amount of recoverable amount measured at fair value after deducting disposal expenses
□ Applicable √ Not applicable
Determination of present value of recoverable amount based on expected cash flows
□ Applicable √ Not applicable
248 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XVIII. Major Item Notes of the Parent Company’s Financial Statements (Cont’d)
5. Revenue and operating costs
Unit: RMB
Amount for the period Amount for the prior period
Item Revenue Costs Revenue Costs
Principal activities 73344245.36 217883215.76 2708082195.91 2557283330.60
O ther activities 166156874.39 46018931.31 1697561235.90 1488712049.31
T otal 239501119.75 263902147.07 4405643431.81 4045995379.91
Breakdown information of operating revenues and operating costs:
Unit: RMB
Machine-made paper Others Total
Category of contract Revenue Operating costs Revenue Operating costs Revenue Operating costs
Type of business 107117560.18 251795262.62 132383559.57 12106884.45 239501119.75 263902147.07
Including:
Machine-made paper 73344245.36 217883215.76 73344245.36 217883215.76
Others 33773314.82 33912046.86 132383559.57 12106884.45 166156874.39 46018931.31
By geographical area 107117560.18 251795262.62 132383559.57 12106884.45 239501119.75 263902147.07
Including:
Mainland China 107117560.18 251795262.62 132383559.57 12106884.45 239501119.75 263902147.07
By the timing of delivery 107117560.18 251795262.62 132383559.57 12106884.45 239501119.75 263902147.07
Including:
Goods (at a point in time) 107117560.18 251795262.62 119760026.02 3779121.74 226877586.20 255574384.36
Services (within a certain period) 12623533.55 8327762.71 12623533.55 8327762.71
By sales channels 107117560.18 251795262.62 132383559.57 12106884.45 239501119.75 263902147.07
Including:
Distribution 73344245.36 217883215.76 73344245.36 217883215.76
Direct sales 33773314.82 33912046.86 132383559.57 12106884.45 166156874.39 46018931.31
Total 107117560.1 8 251795262.6 2 132383559.5 7 12106884.4 5 239501119.7 5 263902147.0 7
SHANDONG CHENMING PAPER HOLDINGS LIMITED 249
INTERIM REPORT 2025VIII Financial Report
XVIII. Major Item Notes of the Parent Company’s Financial Statements (Cont’d)
5. Revenue and operating costs (Cont’d)
Information related to performance obligations:
Nature of goods Company’s Types of quality
Time for that the commitments assurance
fulfilment of Significant Company Whether the person expected to be offered by the
performance terms undertakes is the primary refunded to Company and
Item obligations of payment to transfer person in charge customers related obligations
Machine-made paper Domestic sales on the Domestic sales tend Produces easily Yes No Guaranteed quality assurance should there
day of delivery to the to be provided on an distinguishable be objections to product quality within 7
customer; foreign sales invoice basis; foreign days of arrival the products can be returned
on the day of customs sales tend to be prepaid and exchanged
clearance
Other explanations: The Company’s performance obligations for sales of machine-made paper are generally less than
one year and the Company takes advance payments or provides credit terms depending on the customer. When the
Company is the primary responsible party for a sale it generally obtains the unconditional right to receive payment
when control of the merchandise is transferred to the customer either at the time of shipment or upon delivery to the
destination specified by the customer.Information related to the transaction price allocated to residual performance obligations:
At the end of the reporting period the amount of revenue with signed contracts but unfulfilled or uncompleted
performance obligation was RMB708458794.41 in which RMB708458794.41 was expected to be recognised in 2025.
6. Investment income
Unit: RMB
Amount for Amount for
Item the period the prior period
Income from long-term equity investments accounted for using the
cost method 236900000.00 109400000.00
Income from long-term equity investments accounted for using the
equity method -5404278.73 -36830257.52
Investment gain on disposal of long-term equity investments -117507186.75
Investment gain on holding other non-current financial assets 1298463.59
Investment gain on derecognition of financial assets -10845725.80
Total 231495721.27 -54484706.48
250 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025VIII Financial Report
XIX. Supplementary information
1. Breakdown of extraordinary gains or losses for the current period
√ Applicable □ Not applicable
Unit: RMB
Item Amount Remark
Profit or loss from disposal of non-current assets -97049878.76
Government grants (except for the government grants closely related to
the normal operation of the Company granted in accordance with an
established standard and having an ongoing effect on the Company’s
profit or loss in compliance with national policies and regulations)
accounted for in profit or loss for the current period 25503367.73
Except for effective hedging activities conducted in the ordinary course
of business of the Company gain or loss arising from the change in fair
value of financial assets and financial liabilities held by a non-financial
company as well as gain or loss arising from disposal of its financial
assets and financial liabilities 8439571.88
Reversal of provision for impairment of receivables individually tested for
impairment 13201496.76
Profit or loss from debt restructuring -37171293.24
Profit or loss from changes in the fair value of consumable biological assets
subsequently measured at fair value -129059190.34
Other non-operating income and expenses other than the above items -18188031.78
Total extraordinary gains or losses -234323957.75
Less: Effect of income tax of extraordinary gains or losses 2948680.16
Net extraordinary gains or losses -237272637.91
Less: Net effect of extraordinary gains or losses attributable to minority
interest (after tax) -24683063.16
Extraordinary gains or losses attributable to ordinary shareholders of the
Company -212589574.75 －
SHANDONG CHENMING PAPER HOLDINGS LIMITED 251
INTERIM REPORT 2025VIII Financial Report
XIX. Supplementary information (Cont’d)
1. Breakdown of extraordinary gains or losses for the current period (Cont’d)
Details of other gain or loss items that fall within the definition of extraordinary gain or loss:
□ Applicable √ Not applicable
The Company did not have details of other gain or loss items that fall within the definition of extraordinary gain or loss.Explanation on the extraordinary gain or loss items as illustrated in the Explanatory Announcement on Information
Disclosure for Companies Offering Their Securities to the Public No.1 – Extraordinary Gains or Losses defined as its
recurring gain or loss items
√ Applicable □ Not applicable
Item Amount involved Reasons
Other income 24301996.32 Gov ernment grants related to assets that are closely related to the
Company’s normal operations are subsequently amortised to other
income which has a continuing effect on the Company’s profit or loss
and is therefore accounted for as recurring profit or loss.
2. Return on net assets and earnings per share
Weighted Earnings per share
average return Basic Diluted
Profit for the reporting period on net assets (RMB per share) (RMB per share)
Net profit attributable to ordinary shareholders of
the Company -53.39% -1.31 -1.31
Net profit after extraordinary gains or losses
attributable to ordinary shareholders of the
Company -50.44% -1.24 -1.24
3. Accounting data difference under accounting standard at home and abroad
(1) Differences of net profit and net assets disclosed in financial reports prepared under IAS and Chinese
accounting standards
□ Applicable √ Not applicable
(2) Differences of net profit and net assets disclosed in financial reports prepared under oversea and Chinese
accounting standards
□ Applicable √ Not applicable
(3) Reasons for the differences in figures under domestic and foreign accounting standards. The name of the
foreign audit institution shall be indicated if the data audited by the foreign audit institution has been regulated
differently
□ Applicable √ Not applicable
The Board of Shandong Chenming Paper Holdings Limited
29 August 2025
252 SHANDONG CHENMING PAPER HOLDINGS LIMITED
INTERIM REPORT 2025
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