(a joint stock limited company incorporated in the People's Republic of China with limited liability) (於中華人民共和國註冊成立之股份有限公司) (Stock Code 股份代號 : 00811) ANNUAL REPORT 2018 年度報告 For identification purposes only 僅供識別 Contents 2 Definitions 6 Important Notice 7 Corporate Information 9 Financial Summary 10 Chairman’s Statement 16 Corporate Structure of the Group 20 Management Discussion and Analysis 38 Report of the Directors 51 Corporate Governance Report 65 Profile of Directors, Supervisors, Senior Management and Employees 75 Environmental, Social and Governance Report 94 Report of the Supervisory Committee 97 Auditor’s Report 102 Statements, Notes and Supplementary Information Prepared in accordance with the China Accounting Standards for Business Enterprises Definitions In this report (excluding the section of the auditor’s report), the following expressions shall have the meanings stated below unless the context otherwise requires: 2018 AGM the annual general meeting to be held by the Company on 21 May 2019 A Share(s) Renminbi-denominated ordinary share(s) of the Company with a nominal value of RMB1.00 each, all of which are issued in China, subscribed in Renminbi and listed on the SSE Articles of Association the articles of association of the Company (as amended from time to time) Audit Committee the audit committee under the Board of the Company Bank of Chengdu Bank of Chengdu Co., Ltd. Beijing Aerospace Cloud Beijing Aerospace Cloud Education Technology Co., Ltd. Board the board of directors of the Company CG Code the Corporate Governance Code set out in Appendix 14 to the Listing Rules CITIC Buyout Fund CITIC Buyout Investment Fund (Shenzhen) Partnership (Limited Partnership) Company Law the Company Law of the People’s Republic of China Company, Xinhua Winshare Xinhua Winshare Publishing and Media Co., Ltd.* (新華文軒出版傳媒股份有 or Listed Company 限公司) Companies Ordinance the Hong Kong Companies Ordinance (Chapter 622 of the Laws of Hong Kong) Consolidated Statement of Changes the details of movements of the Group’s reserves for the Year in Shareholders’ Equity Controlling Shareholder or Sichuan Xinhua Publishing Group Co., Ltd. Sichuan Xinhua Publishing Group CSRC China Securities Regulatory Commission Deloitte Touche Tohmatsu CPA Deloitte Touche Tohmatsu Certified Public Accountants LLP Director(s) the director(s) of the Company Xinhua Winshare Publishing and Media Co., Ltd. Xinhua Winshare Publishing and Media Co., Ltd. 2 2018 Annual Report 2018 Annual Report 3 Definitions Dividend Entitlement Date 3 June 2019 Dividend for 2018 the payment of dividend for the year ended 31 December 2018 of RMB0.30 (tax inclusive) per share recommended by the Board ESG environmental, social and governance ESG Report the report prepared in accordance with the ESG Reporting Guide ESG Reporting Guide the Environmental, Social and Governance Reporting Guide set out in Appendix 27 to the Listing Rules Financial Summary the summary of results, assets, liabilities and equity of the Group for the past five years Group the Company and its subsidiaries H Share(s) overseas listed foreign share(s) of the Company with a nominal value of RMB1.00 each, all of which are issued in Hong Kong, subscribed in Hong Kong dollars and listed on the Stock Exchange Hagong Intelligent Jiangsu Hagong Intelligent Robot Co., Ltd. Hua Sheng Group Chengdu Hua Sheng (Group) Industry Co., Ltd. Huang Peng Property Chengdu Huang Peng Property Co., Ltd. Jinshi Bohui Beijing Jinshi Bohui Technology Co., Ltd. Liaoning Publication Group Liaoning Publication Group Co., Ltd. Listing Rules the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited and/or the Rules Governing the Listing of Stocks on Shanghai Stock Exchange, as the case may be Model Code the Model Code for Securities Transactions by Directors of Listed Issuers set out in Appendix 10 to the Listing Rules Nomination Committee the nomination committee under the Board of the Company NSSF National Council for Social Security Fund – transfer account no.2 (轉特二戶) Xinhua Winshare Publishing and Media Co., Ltd. Xinhua Winshare Publishing and Media Co., Ltd. 2 2018 Annual Report 2018 Annual Report 3 Definitions Property Management Agreement the property management agreement renewed with Huang Peng Property, a wholly-owned subsidiary of Sichuan Xinhua Publishing Group Qingdao Jinshi Qingdao Jinshi Zhixin Investment Center (Limited Partnership) Reader’s Journal Sichuan Reader’s Journal Press Co., Ltd. Remuneration and Review Committee the remuneration and review committee under the Board of the Company RMB Renminbi, the lawful currency of China RMB, RMB10,000 and RMB100 million RMB, RMB10,000 and RMB100 million Sales value the list price of books printed at the back of each book SASAC of Sichuan State-owned Assets Supervision and Administration Commission of the Sichuan Provincial Government September Online the digital content push platform under Winshare Online Shareholder(s) H shareholder(s) and A shareholder(s) of the Company Sichuan BLOGIS Sichuan Winshare BLOGIS Supply Chain Co., Ltd. Sichuan Daily Group Sichuan Daily Newspaper Group Sichuan Development Sichuan Development (Holding) Co., Ltd. Sichuan Xinhua Printing Sichuan Xinhua Printing Co., Ltd. Sichuan Wenzhuo Sichuan Wenxuan Zhuotai Investment Co., Ltd. SPG Sichuan Publication Group Co., Ltd SSE Shanghai Stock Exchange Stock Exchange The Stock Exchange of Hong Kong Limited Strategy and Investment the strategy and investment planning committee under the Board of the Planning Committee Company Xinhua Winshare Publishing and Media Co., Ltd. Xinhua Winshare Publishing and Media Co., Ltd. 4 2018 Annual Report 2018 Annual Report 5 Definitions Supervisory Committee the supervisory committee of the Company Supervisor(s) the supervisor(s) of the Company Taizhou Xinheng Taizhou Xinheng Zhongrun Fund (Limited Partnership) Tiandi Publishing House Sichuan Tiandi Publishing House Co., Ltd. Wan Xin Media Anhui Xinhua Media Co., Ltd. Wenchuan Logistics Sichuan Wenchuan Logistics Co., Ltd. Winshare Hengxin Winshare Hengxin (Shenzhen) Equity Investment Fund Partnership (Limited Partnership) Winshare Investment Winshare Investment Co., Ltd. Winshare Online Sichuan Winshare Online E-commerce Co., Ltd. winxuan.com the online sales platform of paper publications under Winshare Online Year, Period or Reporting Period the period from 1 January 2018 to 31 December 2018 Youth and Children’s Publishing House Sichuan Youth and Children’s Publishing House Co., Ltd. Xinhua Winshare Publishing and Media Co., Ltd. Xinhua Winshare Publishing and Media Co., Ltd. 4 2018 Annual Report 2018 Annual Report 5 Important Notice I. The Board, the Supervisory Committee, Directors, Supervisors and senior management of the Company warrant that this annual report is true, accurate and complete and does not contain any false records, misleading statements or material omission and jointly and severally take full legal responsibility as to the contents herein. II. Save as Mr. Yang Miao who appointed Mr. He Zhiyong (the Chairman) as his proxy to vote on his behalf due to other business commitments, other Directors of the Company attended the second Board meeting for the fourth session of the Board held on 27 March 2019 at which this annual report was considered and approved. III. Deloitte Touche Tohmatsu CPA issued a standard unqualified audit report for the Company. IV. Mr. He Zhiyong, the head of the Company, Mr. Zhu Zaixiang, the person-in-charge of accounting affairs, and Ms. Wu Sufang, the head of accounting department, declare that they warrant the truthfulness, accuracy and completeness of the financial statements contained in this annual report. V. The net profit attributable to the Shareholders of the Company for 2018 amounted to RMB932 million. For the profit distribution proposal for 2018, it is proposed that, on the basis of a total share capital of 1,233,841,000 Shares in issue, a cash dividend of RMB0.30 per Share (tax inclusive) will be distributed to the Shareholders, with total cash dividend amounting to RMB370 million (tax inclusive). The above profit distribution proposal is subject to the approval by the Shareholders at the 2018 AGM before the execution thereof. VI. The forward-looking statements included in this report, including future plans and development strategies, do not constitute actual commitment of the Company to investors. Investors should be reminded of the risks of investment. VII. The Company has not provided any external guarantees in violation of the prescribed decision-making procedures during the Reporting Period. VIII. During the Reporting Period, there were no major risks that would have a material impact on the production and operations of the Company. Please read the section headed “Management Discussion and Analysis” of this report for details of the risk factors that may be involved are set out by the Company. Xinhua Winshare Publishing and Media Co., Ltd. Xinhua Winshare Publishing and Media Co., Ltd. 6 2018 Annual Report 2018 Annual Report PB Corporate Information LEGAL NAME OF THE COMPANY Audit Committee 新華文軒出版傳媒股份有限公司 Mr. Chan Yuk Tong (Chairman) Mr. Fang Bingxi COMPANY NAME IN ENGLISH Mr. Zhang Peng XINHUA WINSHARE PUBLISHING AND MEDIA CO., LTD.* Remuneration and Review Committee LEGAL REPRESENTATIVE Mr. Chan Yuk Tong (Chairman) Ms. Xiao Liping Mr. He Zhiyong Mr. Luo Jun BOARD OF DIRECTORS Nomination Committee Executive Directors Ms. Xiao Liping (Chairlady) Mr. Chan Yuk Tong Mr. He Zhiyong (Chairman) Mr. Luo Jun Mr. Chen Yunhua (Vice chairman)