DONGFENGGROUP：2020InterimReport.pdf

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1、ContentsChairmans Statement2Corporate Information5Report of the Directors6Management Discussion and Analysis17Directors,Supervisors and Senior Management25Unaudited Interim Condensed Consolidated Financial Statements and Notes27Definitions562020 Interim Report2Chairmans StatementDear Shareholders,On

2、 behalf of the Board of Directors,I hereby present the 2020 interim report of the Group for your review.In the first half of 2020,affected by the COVID-19 epidemic and Chinas economic downturn,Chinas automotive industry sold approximately 10,257,000 units vehicles,representing a year-on-year decreas

3、e of 16.9%,of which passenger vehicle sales were 7,873,000 units,representing a year-on-year decrease of 22.4%,and commercial vehicle sales totalled 2,384,000 units vehicles,representing a year-on-year increase of 8.6%.Among which,in the first quarter,the impact of the COVID-19 epidemic was obvious,

4、with the industry sales falling by 42.4%year on year;in the second quarter,the epidemic slowed down and was stimulated by consumption release and favourable policies,and therefore,the recovery of the Chinese auto market was accelerated.The development of the automobile industry in the first half of

5、the year showed the following characteristics:1.Passenger vehicles ended 22-month negative growth,and the sales growth rate in the second quarter turned from negative to positive,reaching 7.2%in May.Meanwhile,the market share of Japanese brands increased by 3.7%,while that of self-developed brands d

6、ecreased by 5.2%.2.Major passenger vehicle manufacturers extended their strategy from a single hot model to a product portfolio strategy,making their market response more flexible,with the products complementing each other,relying on the more effective strategy of product mixtures.After the epidemic

7、,various brands improved their accessibility and actively entered the community to get closer to customers.3.The commercial vehicle market saw double-digit sales growth in the second quarter,reaching 46.4%.Among them,the market share of medium and heavy lorries,whose(traction,cargo,engineering)struc

8、tural transformation models accelerated and increased significantly.4.The sales volume of light lorries hit a record high,and policy changes drove changes in the structure of the light lorry market segment.5.In the export market,as the epidemic spread rapidly around the world,overseas automobile dem

9、and shrank sharply.In March,the export market performed better than in the same period last year due to the superimposed effects from the release of backlog orders and the gradual resumption of work;Since April,there has been a significant decline,and the decline has been growing month by month.6.Th

10、e new energy vehicle market experienced a year-on-year sharp decline.During the epidemic,the demand for private travel dropped sharply,and the replacement of taxis hailed on the pavement and booked online with new vehicles was affected to some extent.The new car-making forces entered a reshuffle per

11、iod,and the rapid rise of Tesla affected the domestic market demand for new energy vehicles.Dongfeng Motor Group Company Limited3Chairmans Statement(Continued)The Group sold 1,144,500 units vehicles in the first half of the year,representing a year-on-year decrease of 16.7%,with the drop slightly lo

12、wer than the industrys 0.2 percentage point.The Group achieved sales revenue of approximately RMB50,576 million,representing a year-on-year increase of approximately 4.4%.Calculated by analogy and proportional consolidation,the Group achieved sales revenue of approximately RMB106,732 million in the

13、first half of the year,a decrease of 9.7%from the same period last year.This result was not easy to achieve.As the Group was at the centre of the COVID-19 epidemic,it was significantly affected by the epidemic in the first quarter.With its overall resumption of work and production one month later as

14、 compared with that in the industry,the Groups sales in the second quarter outperformed the market,with a year-on-year increase of 11.9%,higher than the industry by 1.6 percentage points.In the first half of the year,the Groups passenger vehicle sales revenue was approximately RMB59,435 million,repr

15、esenting a year-on-year decrease of approximately 23.2%;commercial vehicle sales revenue was approximately RMB42,831 million,a year-on-year increase of approximately 11.5%;profit attributable to equity holders of the company was approximately RMB3,018 million,representing a year-on-year decrease of

16、approximately 64.5%.In the first half of the year,the operating characteristics of the Group are as follows:1.In the first half of the year,the Group ranked third in the industry;2.On the premise of ensuring safety,we spared no effort to promote the resumption of work and production of the Group,and

17、 drive the orderly resumption of work and production in the upstream and downstream sections of the industrial chain;we also adjusted our business strategy for 2020 in a timely manner to minimise our losses from the epidemic.3.In the passenger vehicle sector,the overall sales of passenger vehicle is

18、 882,300 units,representing a year-on-year decrease of 22.2%,with the drop slightly lower than the industrys 0.2 percentage point.The growth rate of the sales in the second quarter was 2.3 percentage points higher than that in the industry.Dongfeng Nissan sold 437,200 units vehicles in the first hal

19、f of the year,representing a year-on-year decrease of 17.3%,with the drop slightly lower than the industrys 5.1 percentage point.By the end of July,the market share was approximately 8.4%,representing a year-on-year increase of 0.3 percentage point.Dongfeng Honda sold 302,400 units in the first half

20、 of the year,representing a year-on-year decrease of 16.9%,with the drop slightly lower than the industrys 5.5 percentage point.4.In the commercial vehicle sector,the overall sales of commercial vehicle is 262,200 units,representing a year-on-year increase of 9.0%,with the growth slightly higher tha

21、n the industrys 0.4 percentage point.Dongfeng Liuzhou Motors sales growth rate was 29.1 percentage points higher than that of the industry,the growth rate of light lorry sales was 12.3 percentage points higher than that of the industry,and the sales growth of Dongfeng Automobile Co.,Ltd.was 12.6 per

22、centage points higher than that of the industry.5.The pace of development of independent brands accelerated.The Group promoted reforms and adjustments and the creation of strategic models,and strove to solve the difficulties in the development of self-owned brand passenger vehicles.The Group also el

23、evated its brands,launched the new i-Land brand,and made important progress in the high-end electric vehicle project of its own brands.6.The Groups core capabilities and new development momentum continued to improve while the Group continued to promote the research and development of key core techno

24、logies and the collaborative utilisation of key resources.Demonstration operations were carried out on terminal unmanned lorries and micro-buses.2020 Interim Report4Chairmans Statement(Continued)In the first half of the year,the Group went all out to fight the battle for pandemic prevention and cont

25、rol and the resumption of work and production,as well as the tough battle of production,operation and reform and development.It demonstrated its sense of responsibility in the big test and handed in a qualified answer sheet.In the second half of the year,with the effective control of the domestic ep

26、idemic and the implementation of Chinas policies of“six stabilities”and“six guarantees”,the domestic economy will gradually recover.In the second quarter,the countrys GDP a year-on-year increased by 3.2%,which indicated that the Chinese economy had taken the lead in getting out of the predicament an

27、d re-entering the growth track.It is expected that Chinas sustained economic growth will not change.However,for the whole year,the auto industry has been affected by the epidemic,economic downturn and short-term damage to residents incomes and consumer confidence.It is expected that the auto market

28、will still see a large decline in 2020,and the industry predicts that sales growth will be around-7.3%.In 2021,as the domestic economy rebounds,the auto market is expected to return to normal demand and achieve positive growth.By 2025,the overall situation of the auto industry will still be in a sli

29、ghtly upward trend.For the second half of the year,Dongfeng Motor Groups outlook is as follows:1.To accelerate the catch-up and complete the sales target beyond estimates;2.To grasp the implementation of auto market policies and increase market share;3.To increase the sales of its core products of i

30、ndependent brands;4.Adapt to changes in customer consumption habits,accelerate digital transformation,and build a brand new marketing ecosystem to empower dealers and improve the marketing system capabilities;5.Control supply chain and project risks,as well as the double risks of compliance and prod

31、uct consistency risks;6.Conduct work relating to production safety,energy conservation and environmental protection.7.Conduct work relating to the“14th Five-Year Plan”,continue to build the new i-Land brand,and the issuance and listing of A shares.The goals and tasks for the second half of the year

32、have been determined.Regardless of the severity of the situation,the complexity of the tasks,and the difficulty in achieving the goals,we shall implement them with a strong style.All units will follow the Groups assigned goals by not making excuses,not negotiating for more favourable conditions,stic

33、king to the goals in a determined manner,working hard for victory,and eventually obtaining the best“report card”.Zhu YanfengChairman28 August 2020Dongfeng Motor Group Company Limited5Corporate InformationREGISTERED NAMEDongfeng Motor Group Company LimitedREGISTERED ADDRESSSpecial No.1 Dongfeng RoadW

34、uhan Economic and Technology Development ZoneWuhan,Hubei 430056 PRCPRINCIPAL PLACE OF Special No.1 Dongfeng RoadBUSINESS IN THE PRC Wuhan Economic and Technology Development ZoneWuhan,Hubei 430056,PRCPRINCIPAL PLACE OF Level 54,Hopewell Centre,BUSINESS IN 183 Queens Road East,HONG KONGHong Kong SARC

35、OMPANY WEBSITECOMPANY SECRETARIESLu FengYuen Wing Yan,Winnie(FCIS,FCS(PE)AUDITORSPricewaterhouse CoopersHONG KONG Computershare Hong Kong Investor Services LimitedH SHARE REGISTRARShops 1712171617th Floor,Hopewell Centre,183 Queens Road EastWan Chai,Hong Kong SARPLACE OF LISTINGThe Stock Exchange of

36、 Hong Kong LimitedSTOCK CODE004892020 Interim Report6Report of the DirectorsI.BUSINESS OVERVIEW(I)Major BusinessesDongfeng Motor Group is principally engaged in the businesses of research and development,manufacturing and sales of commercial vehicles,passenger vehicles,engines and other auto parts,a

37、utomobile equipment manufacturing,import and export of automobile products,logistics services,financing services,insurance agency and used car trading.The principal products include commercial vehicles(heavy trucks,medium trucks,light trucks,mini trucks and buses,special purpose vehicles,semi-traile

38、rs as well as auto engines and auto parts related to commercial vehicles)and passenger vehicles(basic passenger vehicles,MPVs,SUVs and auto engines and auto parts related to passenger vehicles).The commercial vehicle business of Dongfeng Motor Group is mainly operated by Dongfeng Commercial Vehicle

39、Co.,Ltd.(a joint venture between the Company and Volvo Cars),Dongfeng Motor Co.,Ltd.(a joint venture between the Company and Nissan Motor Co.,Ltd.(through Nissan(China)Investment Co.,Ltd.),Dongfeng Liuzhou Motor Co.,Ltd.and Dongfeng Special Commercial Vehicle Co.,Ltd.Dongfeng Motor Groups passenger

40、vehicle business is currently operated by Dongfeng Passenger Vehicle Company,Dongfeng Liuzhou Motor Co.,Ltd.and Dongfeng Motor Co.,Ltd.(through Dongfeng Nissan Passenger Vehicle Company,Dongfeng Infiniti Motor Co.,Ltd.and Dongfeng Venucia Motor Company),Dongfeng Peugeot Citron Automobile Co.,Ltd.(a

41、joint venture between the Company and the PSA Peugeot Citron Group),Dongfeng Honda Automobile Co.,Ltd.(a joint venture between the Company and Honda Motor Co.,Ltd.)and Dongfeng Renault Automobile Co.,Ltd.(a joint venture between the Company and Renault S.A.).In recent years,Dongfeng Motor Group has

42、accelerated the development of its new-energy vehicle business,which is principally operated by Dongfeng Motor Co.,Ltd.,Dongfeng Special Commercial Vehicle Co.,Ltd.,Dongfeng Passenger Vehicle Company and Zhixin Technology Co.,Ltd.,VOYAH Automobile Technology Co.,Ltd.,eGT New Energy Automotive Co.,Lt

43、d.and Dongfeng Changxing(Wuhan)Technology Co.,Ltd.The financing service business of Dongfeng Motor Group is currently operated by the following companies:Dongfeng Motor Finance Co.,Ltd.(a wholly-owned subsidiary of the Company),Dongfeng Nissan Auto Finance Co.,Ltd.(an associate company between the C

44、ompany,Nissan Motor Co.,Ltd.and Nissan(China)Investment Co.,Ltd.),Dongfeng Nissan Financial Leasing Co.,Ltd.(an associate of the Company),Dongfeng Peugeot Citron Auto Finance Co.,Ltd.(a joint venture between the Company,Peugeot Citron Netherlands Finance Co.,Ltd.and Dongfeng Peugeot Citron Automobil

45、e Co.,Ltd.),and Chuangge Financial Leasing Co.,Ltd.(a wholly-owned subsidiary of the Company)and Dongfeng Peugeot Citron Financial Leasing Co.,Ltd.(a joint venture between the Company,Dongfeng Peugeot Citron Automobile Co.,Ltd.and Peugeot Citron Netherlands Finance Co.,Ltd.).Dongfeng Motor Group Com

46、pany Limited7Report of the Directors(Continued)(II)Principal Business Operations during the First Half of 2020As at 30 June 2020,the production and sales volume for vehicles of Dongfeng Motor Group were approximately 1,121,900 units and 1,144,500 units respectively.According to the statistics publis

47、hed by the China Association of Automobile Manufacturers,Dongfeng Motor Group had a market share of approximately 11.2%in terms of sales volume of commercial and passenger vehicles made by domestic manufacturers in the first half of 2020.The following table sets out the production and sales volumes

48、of commercial and passenger vehicles of Dongfeng Motor Group as well as their respective market shares in terms of sales volume in the first half of 2020:Production VolumeSales VolumeMarket Share(Unit)(Unit)(%)1Commercial Vehicles270,450262,20810.9Trucks261,738253,19811.5Buses8,7129,0104.8Passenger

49、Vehicles851,423882,27711.2Basic passenger cars40,26642,79012.7MPVs454,267469,68311.7SUVs356,890369,80410.0 Total1,121,8731,144,48511.2 1 Calculated based on the statistics published by the China Association of Automobile ManufacturersRevenue of the Group for the six months ended 30 June 2020:Busines

50、sSales RevenueContribution to the Groups Sales Revenue(RMB million)(%)Passenger vehicles7,60615.0Commercial vehicles39,31477.7Financing service3,4796.9Corporate and others3050.6Elimination(128)(0.3)Total50,576100.0 2020 Interim Report8Report of the Directors(Continued)(III)Principal Business Achieve

51、ments during the First Half of 20201.In the passenger vehicle sector,the overall sales of passenger vehicle is 882,300 units,representing a year-on-year decrease of 22.2%,with the drop slightly lower than the industrys 0.2 percentage point.The growth rate of the sales in the second quarter was 2.3 p

52、ercentage points higher than that in the industry.Dongfeng Nissan sold 437,200 units vehicles in the first half of the year,representing a year-on-year decrease of 17.3%,with the drop slightly lower than the industrys 5.1 percentage point.By the end of July,the market share was approximately 8.4%,re

53、presenting a year-on-year increase of 0.3 percentage point.Dongfeng Honda sold 302,400 units in the first half of the year,representing a year-on-year decrease of 16.9%,with the drop slightly lower than the industrys 5.5 percentage point.2.In terms of the commercial vehicles sector,the overall sales

54、 of commercial vehicle is 262,200 units,representing a year-on-year increase of 9.0%,with the growth slightly higher than the industrys 0.4 percentage point.Dongfeng Liuzhou Motor Co.,Ltd.s growth rate of sales volume was 29.1 percentage points higher than that of the industry,the growth rate of lig

55、ht lorry was 12.3 percentage points higher than that of the industry,and the sales growth of Dongfeng Motor Automobile Co.,Ltd 12.6 percentage points higher than that of the industry.3.Core capability and new development momentum continued to improve.(IV)Business OutlookIn the first quarter of 2020,

56、the economy and vehicle industry in China have underwent impact caused by the outbreak of the COVID-19 epidemic.The GDP for the first quarter recorded a year-on-year decrease of 6.8%,representing a significant decrease,of which,the tertiary industry has underwent the greatest loss.In the second quar

57、ter,with effective control on the domestic outbreak,as well as the implementation of the national“six stability”and“six protection”policies,the domestic economy resumed progressively,evidenced by a year-on-year increase of 3.2%in the GDP for the second quarter,and Chinas economy has led the way out

58、of the difficulty and set off for development again.The continuous development trend of Chinas economy expects no change.In terms of the vehicle industry,influenced by factors including the downturn trend of economy,short term impact on household income and consumption confidence,the vehicle market

59、has faced significant impact in the first half of 2020,and sales volume of the industry represented a year-on-year decrease of 16.9%.In the second half of the year,given the weakening negative impact of the outbreak and continuous stimulus of policies on consumption,the market gradually returned to

60、normal.Regional policies,such as the relaxing the incremental index in cities with purchase restrictions,issuing subsidy policy of exchanging the old for new vehicles,and national policies,such as the reducing VAT rate of second-hand car sales to 0.5%,the postponing implementation of the national si

61、x standards and postponing the reduction in new energy subsidies,have a stimulating effect on the annual sales of passenger vehicles.The commercial vehicle market supported by policies,will bring growth in the second half of the year.Since March,the elimination of vehicles under state-3 standards ac

62、celerated significantly,mainly involving Beijing,Tianjin,Hebei,Inner Mongolia and the Yangtze River Delta,and showing the trend of spreading to the surrounding regions.The control of overload will also continue to speed up the renewal of vehicles.The“two new and one heavy”construction,mainly includi

63、ng community reconstruction and large projects,will also increase the sales of commercial vehicles.Dongfeng Motor Group Company Limited9Report of the Directors(Continued)In respect of the whole year,the automobile market will expect a significant decline in 2020,with the growth rate of the industrys

64、 estimated sales volume ranging around-7.3%,and that of Dongfeng Motor Group around 1.4%.II.CORPORATE GOVERNANCE1.Overview of Corporate GovernanceThe Company has been in compliance with the relevant requirements provided by the Company Law of the Peoples Republic of China,the Rules Governing the Lis

65、ting of Securities on The Stock Exchange of Hong Kong Limited and the Corporate Governance Code of the Stock Exchange of Hong Kong.The Company supervises and regulates its daily operation in strict compliance with the Articles of Association of Dongfeng Motor Group Company Limited and various govern

66、ing systems of the Company,and regularly reviews the operation and management of the Company.In addition,the Company recognises the importance of transparency in governance and accountability to the shareholders of the Company,and commits to continuously enhancing the standard and effectiveness of c

67、orporate governance to ensure that the Company is developing properly on the right path,and the interests of shareholders in the Company will continue to grow and be well protected.2.Corporate Governance CodeFor the six months ended 30 June 2020,the Company fully complied with the code provisions as

68、 set out in the Corporate Governance Code(the“Code”)of Appendix 14 to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited(“the Listing Rules”)except for Code Provision A.4.2 and A.5.1.The current session of the Board of Directors was appointed on 10 October 2013.

69、According to Code Provision A.4.2,every director should be subject to retirement by rotation at least once every three years.The term of office of the current session of the Board of Directors(including Mr.Zhu Yanfeng who was appointed on 19 June 2015)should end on 9 October 2016 and the directors s

70、hould be subject to retirement by rotation.Currently,the Company has held the board of directors on 10 September 2020 to nominate candidates for the fifth board of directors and the resolutions had been passed on the extraordinary general meeting held on 25 September 2020.Pursuant to the Code Provis

71、ion A.5.1,the nomination committee shall comprise a majority of independent non-executive directors.On 25 May 2020,Mr.Zhang Xiaotie passed away and the only remaining members of the nomination committee was Mr.Zhu Yanfeng(the convenor of the nomination committee)and Mr.Ma Zhigeng,thus failed to meet

72、 the composition requirement of a majority of independent non-executive directors.Subsequently,Mr.Leung Wai Lap,Philip(“Mr.Leung”)was appointed as a member of the Nomination Committee with effect from 28 August 2020,which was complied with the Code Provision A.5.1.2020 Interim Report10Report of the

73、Directors(Continued)In addition,according to the Code Provisions(I)(f)and(L)(d)(iv)disclosed in the Corporate Governance Code,the Company has failed to meet the requirement with Rules 3.10(1),3.10(2)and 3.21 of the Listing Rules,following the pass away of Mr.Zhang Xiaotie,an independent non-executiv

74、e director on 25 May 2020.Rule 3.10(1)of the Listing Rules stipulates that the board of directors of the Company shall include at least three independent non-executive directors;Rule 3.10(2)of the Listing Rules stipulates that at least one of the independent non-executive directors shall have approp

75、riate professional qualifications or accounting or related financial management expertise;and Rule 3.21 of the Listing Rules stipulates that the audit and risk management committee of the Company shall include at least three members,of whom at least one shall be an independent non-executive director

76、 with appropriate professional qualifications or accounting or related financial management expertise as required under Rule 3.10(2)of the Listing Rules.The Company has appointed Mr.Leung as an independent non-executive director of the Company on 25 August 2020.With the appointment of Mr.Leung,the C

77、ompany has complied with Rules 3.10(1)and 3.10(2)of the Listing Rules.Please refer to the relevant announcement on 25 August 2020 for details.In addition,the Company has appointed Mr.Leung as a member of the audit and risk management committee on 28 August 2020,which was in compliance with Rule 3.21

78、.In accordance with Code Provision(I)(g)disclosed in the Corporate Governance Code,Mr.Leung was the business management partner of Ernst&Young(the“Ernst&Young”)Greater China before his retirement in June 2020.According to Rule 3.13(3)of the Listing Rules,if,within two years immediately prior to the

79、date of his appointment as an independent non-executive director,he was a partner of professional adviser which is providing services to subsidiaries of the Company,independence of the director would more likely to be questioned.After assessments of the Board of Directors,in their opinion that altho

80、ugh Mr.Leung was a partner of Ernst&Young,which had only provided professional services to one of the non-wholly owned subsidiaries of the Company,and Mr.Leung did not involve in participating such services;in addition,Ernst&Young is not the auditor of the Company and could not access the accounting

81、 records of the Company and most of the subsidiaries of the Company,therefore,the independency of Mr.Leung was unanimously agreed.Apart from the abovementioned matters,Mr.Leung meets the independent guideline stated in Rule 3.13 of the Listing Rules,and that independent confirmation letter had been

82、sent to the Hong Kong Exchanges and Clearing Limited.3.Securities Transaction of the DirectorsThe Company has adopted a code of conduct regarding the directors securities transactions on terms no less exacting than the required standards set out in the Model Code for Securities Transactions by Direc

83、tors of Listed Issuers(the“Model Code”).After specific enquiries by the Company,all directors have confirmed that they had fully complied with the Model Code throughout the reporting period.Dongfeng Motor Group Company Limited11Report of the Directors(Continued)4.Independent Non-executive DirectorsT

84、he Board of Directors of the Company consists of seven Directors,including three Independent Non-executive Directors.Mr.Leung Wai Lap,Philip,an Independent Non-executive Director,has the qualification and experience of accounting and financial management.The composition of the Board of Directors of

85、the Company is in compliance with the requirement of the Listing Rule 3.10(1)that“every board of directors of a listed issuer must include at least three independent non-executive directors”,the Listing Rule 3.10A that“an issuer must appoint independent non-executive directors representing at least

86、one-third of the board”and the Listing Rule 3.10(2)that“at least one of the independent non-executive directors must have appropriate professional qualifications or accounting or related financial management expertise”.5.Board MeetingThree board meetings were held by the Company in the first half of

87、 2020 and the major matters covered were as follows:To consider and approve the financial budget for 2020 of the Company;To consider and approve the annual cap for bank credit for 2020 of the Company;To consider and approve the interim business plan for 2020 of the Company;To consider and approve th

88、e annual investment plan for 2020 of the Company;To consider and approve investment plan of Shanghai Botai;To consider and approve the change of senior management;To consider and approve the related transactions with Dongfeng Motor Group Co.,Ltd.involved in the logistics integration proposal of Dong

89、feng Group;To consider and approve the proposal of Dongfeng Motor Group Co.,Ltd.to establish T3 Technology Platform company;To consider and approve the 2019 annual report;To consider and approve the issuance and allotment of shares;To consider and confirm the independence of Independent Non-executiv

90、e Directors;2020 Interim Report12Report of the Directors(Continued)To consider and approve the 2019 Environmental,Social and Governance Report of Dongfeng Motor Group Co.,Ltd;To consider and approve the plan for adding members of relevant special committees of the fourth board of directors of the Co

91、mpany;To consider and approve the remuneration packages of Directors and Supervisors for 2020;To consider and approve the convening of 2019 annual general meeting of the Company;To consider and approve the reorganization proposal of Dongfeng Renault.Meetings of Board of Directors allows effective di

92、scussion and prompt and prudent decision.For the six months ended 30 June 2020,the attendance of directors at meetings of Board of Directors is as follows:MembersNo.of Attendance/No.of the MeetingsAttendance rateExecutive DirectorsZhu Yanfeng3/3100%Li Shaozhu3/3100%You Zheng3/3100%Non-executive Dire

93、ctorsCheng Daoran3/3100%Independent Non-executive DirectorsMa Zhigeng3/3100%Chen Yunfei3/3100%Zhang Xiaotie(Passed away on 25 May 2020)1/333%The management of the Company is responsible for providing the Board with relevant data and information necessary for the consideration of various resolutions

94、and arranging officers to report on the progress of various tasks,especially updates on major projects of the Company,at the Board meetings.Dongfeng Motor Group Company Limited13Report of the Directors(Continued)6.Committees under the Board1)Audit and Risk Management CommitteeThe Company has establi

95、shed the Audit and Risk Management Committee in accordance with Rules 3.21 and 3.22 of the Listing Rules.The Audit and Risk Management Committee is mainly responsible for reviewing and monitoring the financial reporting process of the Company,evaluating and determining the nature and level of risks

96、encountered by the Company,reviewing the financial supervision,risk management and internal control system of the Company,and making suggestions and advices to the Board.The Audit and Risk Management Committee is composed of three members,all of whom are Independent Non-executive Directors of the Co

97、mpany.The member of the Audit and Risk Management Committee is Mr.Leung Wai Lap,Philip,an Independent Non-executive Director who has possessed the professional qualification as required under Rule 3.10(2)of the Listing Rules.The other two members are Mr.Chen Yunfei and Mr.Ma Zhigeng,the Independent

98、Non-executive Directors.The Audit and Risk Management Committee has reviewed the unaudited financial report of the Group for the six months ended 30 June 2020.2)Remuneration CommitteeThe Company has established the Remuneration Committee in accordance with Rules 3.25 and 3.26 of the Listing Rules.Th

99、e Remuneration Committee is mainly responsible for formulating the remuneration proposals of directors,supervisors and senior management and medium and long term incentive schemes and submitting the same to the Board for approval.The committee is composed of three members with a majority of Independ

100、ent Non-executive Directors.The chairman of the committee is Mr.Ma Zhigeng,an Independent Non-executive Director,and the other two members are Mr.Chen Yunfei,an Independent Non-executive Director,and Mr.Li Shaozhu,an Executive Director.3)Nomination CommitteeThe Company has established the Nomination

101、 Committee in accordance with Rules A.5.1 to A.5.4 of Corporate Governance Code.The Nomination Committee is mainly responsible for nominating candidates of Directors,studying and reviewing the criteria and procedures for the nomination and selection of Director candidates,and making recommendations.

102、The committee is composed of three members,a majority of whom are Independent Nonexecutive Directors.Mr.Zhu Yanfeng,the chairman of the Company,is the chairman of the Nomination Committee.The other two members of the committee are Mr.Ma Zhigeng and Mr.Leung Wai Lap,Philip,both of whom are Independen

103、t Non-executive Directors of the Company.2020 Interim Report14Report of the Directors(Continued)7.Internal ControlIn the first half of 2020,the Board has fully evaluated the effectiveness of the internal control system of the Company through the Audit and Risk Management Committee and the audit depa

104、rtment of the Company with focuses on the control environment,risk assessment,control activity,information and communication as well as supervision.According to the evaluation on the internal control system,the Board believes that,during the first half of the year,the Company had a complete and full

105、y effective internal control system covering various aspects including corporate governance,operation,investment,finance,administration and human resources.The Board also believes that the internal control system aims to manage potential risks instead of eliminating risks.Therefore,the internal cont

106、rol system of the Company provides reasonable protection,rather than absolute guarantee,for the Company to realize its operation goals.III.MAJOR MATTERSInterim Results and DividendsThe results for the six months ended 30 June 2020 of the Group and the financial position of the Group as at that date

107、are set out in the unaudited interim condensed consolidated financial statements on page 28 to 34 of this interim report.The Board of Directors declared an interim dividend of RMB0.10 per share(2019:RMB0.10 per share)to the shareholders whose names appear on the register of members of the Company on

108、 Saturday,19 September 2020.The interim dividend will be distributed on Wednesday,28 October 2020.Major Acquisitions and Disposals of Subsidiaries,Joint Ventures and AssociatesIn April 2020,after amicable negotiation,the Company and Renault entered into a non-binding memorandum and reached prelimina

109、ry understanding,of which Renault intends to transfer its 50%equity interest in Dongfeng Renault to the Company.Dongfeng Renault will cease to engage in business activities related to the Renault brand.The Company intends to implement business transformation and upgrading with Dongfeng Renault.Accor

110、ding to its overall strategic plan,the Company is committed to achieve high-quality development and innovation in technologies and business model.Material Legal ProceedingsFor the six months ended 30 June 2020,Dongfeng Motor Group was not involved in any material litigation or arbitration and no mat

111、erial litigation or claim was pending or threatened or made against Dongfeng Motor Group as far as the Group was aware.Dongfeng Motor Group Company Limited15Report of the Directors(Continued)Share CapitalAs at 30 June 2020,the total share capital of the Company was RMB8,616,120,000 divided into 8,61

112、6,120,000 ordinary shares of RMB1 each,of which 5,760,388,000 shares were Domestic Shares,representing approximately 66.86%of the total number of shares in issue,and 2,855,732,000 shares were H Shares,representing approximately 33.14%of the total number of shares in issue.Interests of Substantial Sh

113、areholdersAs at 30 June 2020,as recorded in the register required to be kept by the Company pursuant to Section 336 of the Securities and Futures Ordinance,the interest and short positions of persons(excluding directors and supervisors of the Company)who account for 5%or more of the issued share cap

114、ital of the class are as follows:The percentage is calculated based on the number of ordinary shares in issue as of 30 June 2020.Long Position and Lending Pool NameClass of SharesNumber of shares heldPercentage in the class of issued share capital Percentage in the total share capital(%)(%)Dongfeng

115、Motor CompanyDomestic Share5,760,388,000(L)100.0066.86SCMB Overseas LimitedH Share242,282,000(L)8.48(L)2.81Standard Chartered Asia LimitedH Share242,282,000(L)8.48(L)2.81Standard Chartered BankH Share242,282,000(L)8.48(L)2.81Standard Chartered Holding LimitedH Share242,282,000(L)8.48(L)2.81Standard

116、Chartered Holdings(International)B.V.H Share242,282,000(L)8.48(L)2.81Standard Chartered MB Holdings B.V.H Share242,282,000(L)8.48(L)2.81Standard Chartered Private Equity LimitedH Share242,282,000(L)8.48(L)2.81Edinburgh Partners LimitedH Share153,514,000(L)5.38(L)1.78Reynolds Margaret(Meg)H Share235,

117、443,000(L)8.24(L)2.73Ward BryanH Share235,443,000(L)8.24(L)2.73Westwood Global Investments,LLCH Share235,443,000(L)8.24(L)2.73Brown Brothers Harriman&Co.H Share228,671,995(L)8.01(L)2.65H Share228,671,995(P)8.01(P)2.65FIL LimitedH Share228,210,000(L)7.99(L)2.65Pandanus Associates Inc.H Share228,210,0

118、00(L)7.99(L)2.65Pandanus Partners L.P.H Share228,210,000(L)7.99(L)2.65Invesco Asset Management LimitedH Share199,578,867(L)6.98(L)2.31Citigroup Inc.H Share197,869,269(L)6.92(L)2.29892,003(S)0.03(S)0.01193,095,581(P)6.76(P)2.242020 Interim Report16Report of the Directors(Continued)NameClass of Shares

119、Number of shares heldPercentage in the class of issued share capital Percentage in the total share capital(%)(%)FIDELITY FUNDSH Share172,106,000(L)6.02(L)1.99BlackRock,Inc.H Share158,697,678(L)5.56(L)1.8410,930,000(S)0.38(S)0.12JPMorgan Chase&Co.H Share143,679,305(L)5.03(L)1.6622,798,903(S)0.79(S)0.

120、2692,901,739(P)3.25(P)1.07Notes:LLong PositionSShort PositionP-Lending PoolDirectors and Supervisors Interests in the Share Capital of the CompanyAs at 30 June 2020,the interest and short positions of the Directors and Supervisors of the Company,as recorded in the register required to be kept by the

121、 Company pursuant to Section 352 of the Securities and Futures Ordinance are set out below:NamePositionClass of SharesNature of interestNumber of shares heldPercentage in the class of issued share capitalPercentage in the total share capital%He WeiSupervisorH Shares Beneficial interest100,000(L)0.00

122、0.00Li PinganEmployee SupervisorH Shares Beneficial interest60,000(L)0.000.00*Notes:(L)Long Position,(S)Short Position,(P)Lending PoolPurchase,Sale or Redemption of Listed Securities of the CompanyNeither the Company nor its subsidiaries and joint ventures purchased,sold or redeemed any of the liste

123、d securities of the Company during the reporting period.Dongfeng Motor Group Company Limited17Management Discussion and AnalysisI.OPERATING ENVIRONMENTIn mid-2020,the overall situation of China economy remained basically stable when the COVID-19 epidemic brought a serious impact on the global econom

124、y.In the interim period,Chinas GDP growth rate decreased by 1.6%year on year,of which the gross domestic product(GDP)of the PRC increased by 3.2%year on year in the second quarter.Chinas economy has gradually overcome the adverse effect of the epidemic,showing a trend of recovery growth and steady r

125、ecovery and seeing more resilient and vital in its development.Major economic indicators also showed recovery growth.In mid-2020,automobile production and sales in China both exceeded the volume of 10,112,000 units and 10,257,000 units,representing a year-on-year decrease of 16.8%and 16.9%,respectiv

126、ely.The overall performance was better than expected with the continuous narrowed decline rate.China is still the biggest producer and distributor of the world,which,to a certain extent,reflects that the global automobile market has gradually stabilized from explosive development,and tends to be hig

127、h-end and diversified.In mid-2020,the passenger vehicles market ran at a low level with a sale volume of 7,872,500 units,representing a year-on-year decrease of 22.4%.Among which,sale volume of SUV decreased by 14.9%year on year;MPV recorded a significant decrease of 45.7%year on year;basic vehicles

128、 decreased by 25.9%year on year.From the aspect of market structure,the structure is severely diversified,and the sale volume of passenger vehicles of Chinese brands recorded a year-on-year decrease by 29%to 2,854,100 units,accounting for 36.25%of total sales and the share rate decreased by 3.36 per

129、centage points over the same period of last year.German brands,Japanese brands,American brands,Korean brands and French brands sale value of passenger vehicles amounted to 1,967,900 units,1,862,700 units,734,200 units,328,800 units and 24,800 units,accounting for 25%,23.66%,9.33%,4.18%and 0.31%of th

130、e total sales,respectively.Compared with the same period of last year,the year-on-year decrease of passenger vehicles of German brand and Japanese brand was lower than that of the industry,while that of American brand and Korean brand was over 20%,which was higher than that of the industry.In mid-20

131、20,the overall production and sales of the commercial vehicle market outperformed the passenger vehicle market.Especially since the second quarter of this year,the impact of the epidemic has diminished,and commercial vehicle sales maintain sustained growth.From January to June,the production and sal

132、es of commercial vehicles were 2,359,000 units and 2,384,000 units,representing a year-on-year increase of 9.5%and 8.6%,respectively.In terms of production and sales of different models,the production and sales of buses representing a year-on-year decrease of 9.6%and 12.4%,respectively.And the produ

133、ction and sales of trucks representing a year-on-year increase of by 11.5%and 10.8%,respectively.2020 Interim Report18Management Discussion and Analysis(Continued)II.OPERATION ANALYSISIn mid-2020,under the severe situation affected by COVID-19 epidemic,the Company maintained its focus on annual goal

134、s and achieved high-quality development.In mid-2020,although the epidemic affected the sales volume of the Company in the first quarter,the Company seized the opportunity in the second quarter,rapidly increased the sales volume,saved the loss in the first quarter,and the sales volume beat the market

135、 comprehensively.The sales volume of the passenger vehicle of the Company was approximately 1,144,500 units,representing a year-on-year decrease of 16.7%,which was better than the industry by 0.2 percentage points(the overall descending rate of the industry was about 16.9%).Against the background of

136、 negative growth in the market,mostly affected by the epidemic and a large volume base,the Company has fully demonstrated the strength of steady growth and the ability of innovation and development.The sales performance of passenger vehicles of the Group outperformed the market as a whole.In the int

137、erim period,the sales volume of the passenger vehicle of the Company was 882,300 units,representing a year-on-year decrease of 22.2%,which was better than the industry by 0.2 percentage points(the overall descending rate of the passenger vehicles industry was about 22.4%).The total sales volume of c

138、ommercial vehicles of the Group outperformed the market.The favorite and preferred choice of commercial vehicles are still the Dongfeng brand in China.In the interim period,the sales of commercial vehicles of Dongfeng brand were 262,200 units,with a year-on-year growth of 9.0%,better than that of th

139、e industry by 0.4 percentage points(the overall increasing rate of the commercial vehicles industry was about 8.6%).Dongfeng Motor Group Company Limited19Management Discussion and Analysis(Continued)III.FINANCIAL ANALYSIS1.RevenueThe revenue of the Group for the interim period of 2020 was approximat

140、ely RMB50,576 million,representing an increase of approximately RMB2,129 million,or 4.4%,as compared with RMB48,447 million for the corresponding period of last year.The increase in revenue was mainly caused by the increase in sales revenue of Dongfeng Commercial Vehicles Co.,Ltd.The first half of 2

141、020The first half of 2019Sales RevenueSales RevenueRMB millionRMB millionPassenger vehicles7,60613,563Commercial vehicles39,31432,364Financing service3,4792,484Corporate and others305139Elimination(128)(103)Total50,57648,447 1.1 Passenger Vehicle BusinessThe sales revenue of passenger vehicles of th

142、e Group for the interim period of 2020 decreased by approximately RMB5,957 million,or 43.9%,to approximately RMB7,606 million from approximately RMB13,563 million for the corresponding period of 2019.The decrease in revenue was mainly from the passenger vehicle business of Dongfeng Peugeot Citron Au

143、tomobile Sales Co.,Ltd.and Dongfeng Liuzhou Motor Co.,Ltd.1.2 Commercial Vehicle BusinessThe sales revenue of commercial vehicles of the Group for the interim period of 2020 increased by approximately RMB6,950 million,or 21.5%,to approximately RMB39,314 million from approximate RMB32,364 million for

144、 the corresponding period of 2019.The increase in revenue was mainly due to the sales growth of Dongfeng Commercial Vehicles Co.,Ltd.and commercial vehicle business of Dongfeng Liuzhou Motor Co.,Ltd.2020 Interim Report20Management Discussion and Analysis(Continued)1.3 Auto Financing Service Business

145、As the financial business to financial support by Dongfeng Motor to the vehicle sector has yearly strengthened,and the proportion of financial business profits to the Groups profits has gradually increased,notable growth was achieved in the financing service sector,with 40.1%revenue increase on a ye

146、ar-on-year basis.Dongfeng Motor Finance Co.,Ltd.and Chuangge Financial Leasing Co.,Ltd.achieved their goals of revenue and profit before income tax for 2020 and realized a year-on-year increase.The revenue of financing service of the Group for the interim period of 2020 increased by approximately RM

147、B995 million,or approximately 40.1%,to approximately RMB3,479 million from approximately RMB2,484 million for the interim period of 2019.The Groups financing service business maintained its steady growth.2.Cost of Sales and Gross ProfitThe total cost of sales of the Group for the interim period of 2

148、020 was approximately RMB42,760 million,representing an increase of approximately RMB2,107 million,or 5.2%,as compared with approximately RMB40,653 million in the corresponding period of last year.The total gross profit was approximately RMB7,816 million,representing an increase of approximately RMB

149、22 million,or 0.3%,as compared with approximately RMB7,794 million in the corresponding period of last year.The comprehensive gross profit margin was approximately 15.5%,representing an decrease of 0.6%as compared with the corresponding period of last year.The increase in gross profit margin was mai

150、nly due to the impact changes in sales structure.3.Other IncomeThe total other income of the Group for the interim period of 2020 amounted to approximately RMB1,555 million,representing an increase of approximately RMB683 million compared with approximately RMB872 million in the corresponding period

151、 of last year.The increase in other income was mainly due to the disposal income generated by DF Import&Export to dispose of Dong Honda Logistics in the current period.4.Selling and Distribution ExpensesThe selling and distribution expenses of the Group for the interim period of 2020 decreased by ap

152、proximately RMB445 million to approximately RMB2,070 million from approximately RMB2,515 million in the corresponding period of last year.The decrease in sales and distribution expenses was mainly due to the decrease in fixed marketing expenses.Dongfeng Motor Group Company Limited21Management Discus

153、sion and Analysis(Continued)5.Administrative ExpensesThe administrative expenses of the Group for the interim period of 2020 decreased by approximately RMB277 million to approximately RMB1,827 million from approximately RMB2,104 million in the corresponding period of last year.The decrease in admini

154、strative expenses was mainly due to the decrease in wage level of the Group affected by the COVID-19 epidemic.6.Impairment Losses on Financial AssetsThe impairment losses on financial assets of the Group for the interim period of 2020 increased by approximately RMB431 million to approximately RMB967

155、 million from approximately RMB536 million in the corresponding period of last year.The increase in impairment losses on financial assets was mainly due to the increase in provision coverage ratio of Dongfeng Motor Finance Co.,Ltd.affected by the COVID-19 epidemic.7.Other ExpensesThe other expenses

156、of the Group for the half of 2020 amounted to approximately RMB4,438 million,representing an increase of approximately RMB2,403 million as compared with approximately RMB2,035 million in the corresponding period of last year.The increase in other expenses was mainly due to the increase in loss of im

157、pairment losses of non-financial assets.8.Finance ExpensesThe finance expenses of the Group for the interim period of 2020 amounted to approximately RMB599 million,representing an increase of approximately RMB433 million as compared with approximately RMB166 million in the corresponding period of la

158、st year.The increase in net financial expenses was mainly due to the increase in interest expenses on borrowings payable and increase of exchange net gain of financing activities.9.Share of Profits and Losses of Joint VenturesShare of profits and losses of joint ventures of the Group for the interim

159、 period of 2020 decreased by approximately RMB3,561 million to approximately RMB3,224 million from approximately RMB6,785 million in the corresponding period of last year.The main changes are as follows:1.the profit decreased by RMB1,674 million year on year as a result of a decrease in sales volume

160、 of Dongfeng Motor Co.,Ltd.affected by the COVID-19 epidemic;2.the profit decreased by RMB967 million year on year as a result of a decrease in sales volume of Dongfeng Honda Automobile Co.,Ltd.affected by the COVID-19 epidemic;3.the profit decreased by RMB225 million year on year of Dongfeng Honda

161、Engine Co.,Ltd.affected by the decrease in sales volume.2020 Interim Report22Management Discussion and Analysis(Continued)10.Share of Profits and Losses of AssociatesShare of profits and losses of associates of the Group for the interim period of 2020 amounted to approximately RMB853 million,represe

162、nting a decrease of approximately RMB1,079 million as compared with that of approximately RMB1,932 million of the corresponding period of last year,mainly due to:1.the decrease in investment income of RMB1,313 million for investing in PSA Group;2.the financial investment income of Dongfeng Honda inc

163、reased by RMB222 million;11.Income TaxThe income tax expense of the Group for the half of 2020 decreased by approximately RMB382 million to approximately RMB792 million from approximately RMB1,174 million in the corresponding period of last year.The effective tax rate for the period was approximatel

164、y 22.3%,representing an increase of approximately 10.6%as compared with approximately 11.7%in the corresponding period of last year.12.Profit Attributable to Equity Holders of the Company for the YearThe profit attributable to the equity holders of the Company for the interim period of 2020 was appr

165、oximately RMB3,018 million,representing a decrease of approximately RMB54,81 million,or approximately 64.5%as compared with that of approximately RMB84,99 million for the corresponding period of last year.The net profit margin(a percentage of profit attributable to the equity holders of the Company

166、to total revenue)was approximately 6.0%,representing an increase of approximately 11.5 percentage points as compared with approximately 17.5%of the corresponding period of last year.The return on net assets(a percentage of profit attributable to equity holders of the Company to average equity attrib

167、utable to equity holders of the Company)was approximately 4.7%,representing a decrease of approximately 9.3 percentage points as compared with approximately 14%of the corresponding period of last year.13.Total AssetsTotal assets of the Group for the interim period of 2020 amounted to approximately R

168、MB291,966 million,representing an increase of approximately RMB19,966 million as compared with approximately RMB272,000 million as at the end of last year.The increase was mainly due to the increase in investments in joint ventures/associates,fixed assets,loans from financial business and financial

169、assets at fair value through profit or loss.14.Total LiabilitiesTotal liabilities of the Group for the interim period of 2020 amounted to approximately RMB156,887 million,representing an increase of approximately RMB18,855 million as compared with approximately RMB138,032 million as at the end of la

170、st year.The increase was mainly due to the increase in long-term and short-term interest-bearing borrowings,trade payables and bills payable,among which,the balance of long-term and short-term interest-bearing borrowings increased by approximately RMB15,868 million and the balance of trade payables

171、increased by RMB4,722 million.Dongfeng Motor Group Company Limited23Management Discussion and Analysis(Continued)15.Total EquityTotal equity of the Group for the half of 2020 amounted to approximately RMB135,079 million,representing an increase of approximately RMB1,111 million as compared with appr

172、oximately RMB133,968 million as at the end of last year.Equity attributable to equity holders of the Company amounted to approximately RMB129,097 million,representing an increase of approximately RMB1,316 million as compared with approximately RMB127,781 million as at the end of last year.16.Liquidi

173、ty and Sources of CapitalSix months ended30 June 2020Six months ended30 June 2019(RMB million)(RMB million)Net cash flows used in operating activities(3,414)(11,953)Net cash flows(used in)/generated from investment activities(2,374)664Net cash flows from financing activities11,6633,971Net(increase)/

174、decrease in cash and cash equivalents5,875(7,318)The Groups net cash flows used in operating activities was approximately RMB3,414 million.The amount mainly consisted of:(1)profit before taxation amounted to approximately RMB810 million,net of depreciation,impairment and other non-cash items;(2)net

175、cash inflow of approximately RMB4,379 million due to an increase in balance of trade payables;(3)due to joint ventures decreased by approximately RMB5,807 million;(4)loans generated from financial business increased by approximately RMB5,431 million;(5)income tax payment decreased by approximately R

176、MB879 million.The Groups net cash outflow generated from investment activities was approximately RMB2,374 million.The amount mainly consisted of:(1)receipt of dividend from joint ventures and associates,representing cash inflow of approximately RMB7,863 million;(2)capital expenditures,purchase of fi

177、nancial assets held for trading and structured deposit expenditures,representing cash outflow of approximately RMB10,016 million.The Groups net cash flows generated from financing activities was approximately RMB11,663 million.This amount mainly reflected:(1)increase of bank borrowings resulting in

178、a cash inflow of approximately RMB10,258 million;(2)issuance of bonds,resulting in a cash inflow of approximately RMB9,140 million;(3)repayment of bank borrowings and bonds and payment of dividends,resulting in a cash outflow of approximately RMB7,738 million.The increase in financing was mainly to

179、supplement the rapidly growing funding needs of financial business.2020 Interim Report24Management Discussion and Analysis(Continued)As a result of the above,the Groups cash and cash equivalents(excluding non-pledged time deposits with original maturity of three months or more when acquired)amounted

180、 to approximately RMB32,008 million as at 30 June 2020,representing an increase of approximately RMB5,878 million as compared with approximately RMB26,133 million as at 31 December 2019.Cash and bank balances(including non-pledged time deposits with original maturity of three months or more when acq

181、uired)amounted to approximately RMB32,783 million,representing a decrease of approximately RMB6,015 million as compared with approximately RMB26,768 million as at 31 December 2019.As at 30 June 2020,the Groups equity ratio(a percentage of total borrowings to equity attributable to equity holders of

182、the Company)was approximately 45.7%,representing an increase of approximately 11.9 percentage points as compared with approximately 33.8%as at 31 December 2019.The Groups liquidity ratio was approximately 1.36 times,which is flat compared to approximately 1.36 times as at 31 December 2019.The Groups

183、 quick ratio was approximately 1.25 times,representing a flat with approximately 1.25 times as at 31 December 2019.The inventory turnover days of the Group as at 30 June 2020 increased by approximately 4 days to approximately 55 days from approximately 51 days as at 31 December 2019.The Groups turno

184、ver days of receivables(including bills receivable)decreased by approximately 1 day to approximately 87 days as at 31 December 2020 from approximately 88 days as at 31 December 2019.Among them,the turnover days of receivables(excluding bills receivable)decreased by approximately 1 day to approximate

185、ly 38 days from approximately 39 days as at 31 December 2019.The turnover days of bills receivables decreased by approximately 1 days to approximately 48 days from approximately 49 days as at 31 December 2019.The Group adopts stringent policies for the management of bills receivable and only accepts

186、 applications by trustworthy banks and customers with financial strengths,while the credit risks related to bank promissory notes are assumed by the customers banks.17.Major Financial Figures Based on Proportionate ConsolidationBased on proportionate consolidation,the interim revenue of the Group fo

187、r 2020 was approximately RMB106,732 million,representing a decrease of approximately RMB11,495 million,or approximately 9.7%,as compared with approximately RMB118,227 million of the corresponding period of last year.Profit before income tax was approximately RMB5,960 million,representing an increase

188、 of approximately RMB7,509 million,or approximately 55.8%,as compared with approximately RMB13,469 million of the corresponding period of last year.Total assets was approximately RMB363,974 million,representing an increase of approximately RMB13,845 million,or approximately 4.0%,as compared with app

189、roximately RMB350,129 million as at the end of last year.Dongfeng Motor Group Company Limited25Directors,Supervisors and Senior ManagementDuring the disclosure period,of 2020 interim report,the directors,supervisors and senior management of the Company include:DIRECTORSZhu Yanfeng(竺延風)Executive Dire

190、ctor and Chairman of the Board of DirectorsLi Shaozhu(李紹燭)Executive Director,PresidentYou Zheng(尤崢)Executive Director,Vice PresidentYang Qing(楊青)Non-Executive Director(The appointment took effect after the approval of the extraordinary general meeting held on 25 September 2020)Leung Wai Lap,Philip(梁

191、偉立)Independent Non-executive DirectorZong Qingsheng(宗慶生)Independent Non-executive Director(The appointment took effect after the approval of the extraordinary general meeting held on 25 September 2020)Hu Yiguang(胡裔光)Independent Non-executive Director(The appointment took effect after the approval of

192、 the extraordinary general meeting held on 25 September 2020)Cheng Daoran（程道然）Non-Executive Director(Resigned after the approval of the extraordinary general meeting held on 25 September 2020)Ma Zhigeng（馬之庚）Independent Non-executive Director(Resigned after the approval of the extraordinary general m

193、eeting held on 25 September 2020)Zhang Xiaotie（張曉鐵）Independent Non-executive Director(Passed away on 25 May 2020)Chen Yunfei（陳雲飛）Independent Non-executive Director(Resigned after the approval of the extraordinary general meeting held on 25 September 2020)SENIOR MANAGEMENTQiao Yang(喬陽)Vice PresidentF

194、eng Changjun(馮長軍)Vice President、Board SecretaryLu Feng（盧鋒）The Secretary of the Board of Directors and Joint Company SecretaryYuen Wing Yan,Winnie(袁頴欣)Joint Company SecretarySUPERVISORSHe Wei（何偉)Chairman of the Supervisory CommitteeBao Hongxiang（鮑洪湘）Independent Supervisor(The appointment took effect

195、after the approval of the extraordinary general meeting held on 25 September 2020)Zheng Hongyi（鄭紅藝）Employee Supervisor(The appointment took effect after the approval of the extraordinary general meeting held on 25 September 2020)Zhao Jun（趙軍）Independent Supervisor(Resigned after the approval of the e

196、xtraordinary general meeting held on 25 September 2020)Li Pingan（李平安）Employee Supervisor(Resigned after the approval of the extraordinary general meeting held on 25 September 2020)2020 Interim Report26Directors,Supervisors and Senior Management(Continued)HEADS OF DEPARTMENTSThe head of the President

197、s Office of the Company is Mr.Wang Binbin.The head of the Strategic Planning Department of the Company is Mr.You ZhengThe head of the Operation Management Department of the Company is Mr.Gao GuolinThe head of the Human Resource Department of the Company is Mr.Wen Liang.The head of the Financial Acco

198、unting Controlling Department of the Company is Mr.Liao XianzhiThe head of the Organization and Information Department of the Company is Mr.Yu JunThe head of the International Business Department of the Company is Mr.Wei WenqingThe head of the Technical Development Department of the Company is Mr.Li

199、u GuoyuanThe head of the Compliance Audit Department of the Company is Mr.Hu Weidong.The head of the Corporate Culture Department of the Company is Mr.Zheng Hongyi.The head of the discipline inspection and supervision is Zeng Xianan.The head of the Staff Relation Department of the Company is Mr.Yuan

200、 Gang.Dongfeng Motor Group Company Limited27Report on Review of Interim Financial InformationTo the Board of Directors of Dongfeng Motor Group Company Limited(Incorporated in the Peoples Republic of China with limited liability)INTRODUCTIONWe have reviewed the interim financial information set out o

201、n pages 28 to 55,which comprises the interim condensed consolidated statement of financial position of Dongfeng Motor Group Company Limited(the“Company”)and its subsidiaries(together,the“Group”)as at 30 June 2020 and the interim condensed consolidated statement of profit or loss,the interim condense

202、d consolidated statement of comprehensive income,the interim condensed consolidated statement of changes in equity and the interim condensed consolidated statement of cash flows for the six-month period then ended,and a summary of significant accounting policies and other explanatory notes.The Rules

203、 Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited require the preparation of a report on interim financial information to be in compliance with the relevant provisions thereof and International Accounting Standard 34“Interim Financial Reporting”.The directors of the Com

204、pany are responsible for the preparation and presentation of this interim financial information in accordance with International Accounting Standard 34“Interim Financial Reporting”.Our responsibility is to express a conclusion on this interim financial information based on our review and to report o

205、ur conclusion solely to you,as a body,in accordance with our agreed terms of engagement and for no other purpose.We do not assume responsibility towards or accept liability to any other person for the contents of this report.SCOPE OF REVIEWWe conducted our review in accordance with Hong Kong Standar

206、d on Review Engagements 2410,“Review of Interim Financial Information Performed by the Independent Auditor of the Entity”issued by the Hong Kong Institute of Certified Public Accountants.A review of interim financial information consists of making inquiries,primarily of persons responsible for finan

207、cial and accounting matters,and applying analytical and other review procedures.A review is substantially less in scope than an audit conducted in accordance with Hong Kong Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant mat

208、ters that might be identified in an audit.Accordingly,we do not express an audit opinion.CONCLUSIONBased on our review,nothing has come to our attention that causes us to believe that the interim financial information of the Group is not prepared,in all material respects,in accordance with Internati

209、onal Accounting Standard 34“Interim Financial Reporting”.PricewaterhouseCoopersCertified Public AccountantsHong Kong,28 August 20202020 Interim Report28Interim Condensed Consolidated Statement of Profit or LossFor the six months ended 30 June 2020Six months ended 30 June Notes20202019RMB millionRMB

210、million(Unaudited)(Unaudited)Revenue250,57648,447Cost of sales(42,760)(40,653)Gross profit7,8167,794Other income31,555872Selling and distribution expenses(2,070)(2,515)Administrative expenses(1,827)(2,104)Impairment losses on financial assets6(967)(536)Other expenses7(4,438)(2,035)Finance expenses5(

211、599)(166)Share of profits and losses of:Joint ventures3,2246,785Associates8531,932 PROFIT BEFORE INCOME TAX43,54710,027Income tax expense8(792)(1,174)PROFIT FOR THE PERIOD2,7558,853 Profit attributable to:Equity holders of the company3,0188,499Non-controlling interests(263)354 2,7558,853 Earnings pe

212、r share attributable to ordinary equity holders of the Company:10Basic and diluted for the period35.03 cents98.64 cents The notes on pages 35 to 55 form an integral part of this interim consolidated financial information.Dongfeng Motor Group Company Limited29Interim Condensed Consolidated Statement

213、of Comprehensive IncomeFor the six months ended 30 June 2020Six months ended 30 June 20202019RMB millionRMB million(Unaudited)(Unaudited)PROFIT FOR THE PERIOD2,7558,853OTHER COMPREHENSIVE INCOMEItems that will not be reclassified subsequently to profit or lossShare of other comprehensive income of i

214、nvestments accounted for using the equity method21847Others(3)(13)21534 Items that may be reclassified subsequently to profit or lossCurrency translation differences399(35)Share of other comprehensive expense of investments accounted for using the equity method(271)(74)128(109)Income tax effectItem

215、that will not be reclassified subsequently to profit or loss13 OTHER COMPREHENSIVE INCOME FOR THE PERIOD,NET OF TAX344(72)TOTAL COMPREHENSIVE INCOME FOR THE PERIOD3,0998,781 Total comprehensive income attributable to:Equity holders of the Company3,3658,427Non-controlling interests(266)354 3,0998,781

216、 The notes on pages 35 to 55 form an integral part of this interim consolidated financial information.2020 Interim Report30Interim Condensed Consolidated Statement of Financial PositionAs at 30 June 2020Notes30 June 202031 December 2019RMB millionRMB million(Unaudited)ASSETSNon-current assetsPropert

217、y,plant and equipment1119,72217,309Right-of-use assets4,3753,327Investment properties226229Intangible assets4,7355,076Goodwill1,7491,749Investments in joint ventures40,34640,427Investments in associates23,65821,713Financial assets at fair value through other comprehensive income215205Other non-curre

218、nt assets35,77336,470Deferred income tax assets2,1722,356Due from joint ventures4451,035 Total non-current assets133,416129,896 Current assetsInventories12,88112,191Trade receivables1210,62110,690Bills receivable1,1921,439Prepayments,deposits and other receivables54,74951,550Financial assets at fair

219、 value through other comprehensive income12,23412,121Due from joint ventures7,94112,442Pledged bank balances and time deposits134,0893,317Financial assets at fair value through profit or loss18,5216,972Cash and bank balances1332,78326,768Assets held for sale3,5394,614 Total current assets158,550142,

220、104 TOTAL ASSETS291,966272,000 The notes on pages 35 to 55 form an integral part of this interim consolidated financial information.Dongfeng Motor Group Company Limited31Interim Condensed Consolidated Statement of Financial Position(Continued)As at 30 June 2020Notes30 June 202031 December 2019RMB mi

221、llionRMB million(Unaudited)EQUITY AND LIABILITIESEquity attributable to equity holders of the CompanyIssued capital8,6168,616Reserves19,66218,336Retained profits100,819100,829 Non-controlling interests5,9826,187 TOTAL EQUITY135,079133,968 Non-current liabilitiesInterest-bearing borrowings1530,47823,

222、923Lease liabilities2,0812,075Other long term liabilities2,7842,733Government grants2,0572,094Deferred income tax liabilities2,0972,275Provisions743750 Total non-current liabilities40,24033,850 Current liabilitiesTrade payables1423,94219,220Bills payable26,75527,369Lease liabilities141154Other payab

223、les and accruals17,29512,796Contract liabilities4,1593,402Due to joint ventures14,06319,970Interest-bearing borrowings1528,57219,259Income tax payables6411,008Provisions1,0791,004 Total current liabilities116,647104,182 TOTAL LIABILITIES156,887138,032 TOTAL EQUITY AND LIABILITIES291,966272,000 The n

224、otes on pages 35 to 55 form an integral part of this interim consolidated financial information.2020 Interim Report32Interim Condensed Consolidated Statement of Changes in Equity For the six months ended 30 June 2020Attributable to owners of the company Issued capitalCapital reservesStatutory reserv

225、esRetained profitsTotalNon-controlling interestsTotal equityRMB millionRMB millionRMB millionRMB millionRMB millionRMB millionRMB million(Unaudited)(Unaudited)(Unaudited)(Unaudited)(Unaudited)(Unaudited)(Unaudited)For the six months ended 30 June 2020As at 1 January 20208,6162,72715,609100,829127,78

226、16,187133,9682019 final dividend(2,154)(2,154)(2,154)Total comprehensive income for the period3473,0183,365(266)3,099Transfer to reserves874(874)Share of capital reserve of investments accounted for using the equity method434343Dividends declared to non-controlling shareholders(3)(3)Capital contribu

227、tion from non-controlling shareholders557176Other5757(7)50 As at 30 June 20208,6163,17916,483100,819129,0975,982135,079 The notes on pages 35 to 55 form an integral part of this interim consolidated financial information.Dongfeng Motor Group Company Limited33Interim Condensed Consolidated Statement

228、of Changes in Equity(Continued)For the six months ended 30 June 2020Attributable to owners of the company Issued capitalCapital reservesStatutory reserves Retained profitsTotalNon-controlling interestsTotal equityRMB millionRMB millionRMB millionRMB millionRMB millionRMB millionRMB million(Unaudited

229、)(Unaudited)(Unaudited)(Unaudited)(Unaudited)(Unaudited)(Unaudited)For the six months ended 30 June 2019As at 31 December 20188,6162,93913,47393,328118,3566,569124,925Change in accounting policy IFRS 16(187)(187)(85)(272)As at 1 January 20198,6162,93913,47393,141118,1696,484124,6532018 final dividen

230、d(2,154)(2,154)(2,154)Total comprehensive income for the period(72)8,4998,4273548,781Transfer to reserves1,135(1,135)Share of associates other equity changes333333Dividends declared to non-controlling shareholders(344)(344)Changes in ownership interests in subsidiaries without change of control(22)(

231、22)22 As at 30 June 20198,6162,87814,60898,351124,4536,516130,969 The notes on pages 35 to 55 form an integral part of this interim consolidated financial information.2020 Interim Report34Interim Condensed Consolidated Statement of Cash FlowsFor the six months ended 30 June 2020Six months ended 30 J

232、une Note20202019RMB millionRMB million(Unaudited)(Unaudited)Cash flows from operating activitiesCash flows used in operating activities(2,535)(11,018)Income tax paid(879)(935)Cash flows used in operating activities net(3,414)(11,953)Cash flows from investing activitiesAcquisition of subsidiaries,joi

233、nt ventures and associates481(2,539)Dividends from joint ventures and associates7,8638,559Other investing cash flows net(10,718)(5,356)Cash flows(used in)/generated from investing activities net(2,374)664 Cash flows from financing activitiesProceeds from borrowings and bonds19,3987,887Repayments of

234、borrowings and bonds(7,737)(3,609)Dividends paid to minority shareholders(3)(286)Other finance cash flows net5(21)Cash flows generated from financing activities net11,6633,971 Net increase/(decrease)in cash and cash equivalents5,875(7,318)Cash and cash equivalents at beginning of the period26,13324,

235、975 Cash and cash equivalents at end of the period1332,00817,657 The notes on pages 35 to 55 form an integral part of this interim consolidated financial information.Dongfeng Motor Group Company Limited35Notes to Interim Condensed Consolidated Financial InformationFor the six months ended 30 June 20

236、201.1 CORPORATE INFORMATIONDongfeng Motor Group Company Limited(the“Company”)is a joint stock limited liability company incorporated in the Peoples Republic of China(the“PRC”).The registered office of the Company is located at Special No.1 Dongfeng Road,Wuhan Economic and Technology Development Zone

237、,Wuhan,Hubei Province,the PRC.During the period,the Company and its subsidiaries(collectively referred to as the“Group”)were principally engaged in the manufacture and sale of automobiles,engines and other automotive parts and rendering of financing services.In the opinion of the directors,the holdi

238、ng company and the ultimate holding company of the Company is Dongfeng Motor Corporation(“DMC”),a state-owned enterprise established in the PRC.This interim condensed consolidated financial information is presented in Renminbi(“RMB”),unless otherwise stated.This interim condensed consolidated financ

239、ial information was approved for issue by the Board of Directors on 28 August 2020.1.2 BASIS OF PRESENTATIONThe unaudited interim condensed consolidated financial information has been prepared in accordance with International Accounting Standards(“IAS”)34 Interim Financial Reporting issued by the In

240、ternational Accounting Standards Board(“IASB”).The unaudited interim condensed consolidated financial information does not include all the information and disclosures required in the annual financial information,and should be read in conjunction with the Groups annual financial statements as at 31 D

241、ecember 2019,which have been prepared in accordance with International Financial Reporting Standards(“IFRS”).2020 Interim Report36For the six months ended 30 June 2020Notes to Interim Condensed Consolidated Financial Information(Continued)1.3 SIGNIFICANT ACCOUNTING POLICIESThe accounting policies ap

242、plied are consistent with those of the annual consolidated financial information of the Group for the year ended 31 December 2019(referring to the annual financial statements in the relevant year),as described in those annual financial information except for the estimation of income tax using the ta

243、x rate that would be applicable to expected total annual earnings and the adoption of amendments to IFRSs effective for the financial year ended 31 December 2020.(i)New and amended standards adopted by the GroupA number of new or amended standards became applicable for the current reporting period a

244、nd the Group had to change its accounting policies accordingly.The impact of adopting following standards are disclosed below:Effective for annual periods beginning on or afterAmendments to IAS 1 and IAS 8Definition of Material1 January 2020Revised Conceptual FrameworkRevised Conceptual Framework fo

245、r Financial Reporting1 January 2020Amendments to IFRS 3Definition of a Business1 January 2020The other standards did not have any impact on the Groups accounting policies and did not require retrospective adjustments.(ii)New and amended standards that might be relevant to the Group have been issued

246、but are not effective for the financial year beginning 1 January 2019 and have not been early adoptedEffective for annual periods beginning on or afterAmendments to IFRS 10 and IAS 28Sale or Contribution of Assets between an Investor and its Associate or Joint ventureTo be determinedIFRS 17Insurance

247、 Contracts1 January 2023The Group is assessing the full impact of the new standards,new interpretations and amendments to standards and interpretations.Dongfeng Motor Group Company Limited37For the six months ended 30 June 2020Notes to Interim Condensed Consolidated Financial Information(Continued)1

248、.4 ESTIMATESThe preparation of this interim condensed consolidated financial information requires management to make judgments,estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities,income and expenses.Actual results may differ

249、 from these estimates.In preparing this interim condensed consolidated financial information,the significant judgments made by management in applying the Groups accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial stateme

250、nts for the year ended 31 December 2019.2.REVENUE AND SEGMENT INFORMATIONFor management purposes,the Group is organized into business units based on their products and services,and has four reportable operating segments as follows:The commercial vehicles segment mainly manufactures and sells commerc

251、ial vehicles,and its related engines and other automotive parts;The passenger vehicles segment mainly manufactures and sells passenger vehicles,and its related engines and other automotive parts;The financing service segment mainly provides financing services to external customers and companies with

252、in the Group;and The corporate and others segment mainly manufactures and sells other automobile related products.Management monitors the results of the Groups operating segments separately for the purpose of making decisions about resource allocation and performance assessment.Segment performance i

253、s evaluated based on operating segment profit or loss and is measured consistently with profit or loss in the consolidated financial information.However,Group financing(including finance costs)and income taxes are managed on a Group basis and are not allocated to operating segments.As the chief oper

254、ating decision maker of the Group considers that most of the Groups consolidated revenue and results are attributable to the market in the PRC,the Groups consolidated assets are mainly located inside the PRC,no geographical information is presented.During the six months ended 30 June 2019 and 2020,n

255、o revenue from transactions with a single external customer amounted to 10%or more of the Groups total revenue.2020 Interim Report38For the six months ended 30 June 2020Notes to Interim Condensed Consolidated Financial Information(Continued)2.REVENUE AND SEGMENT INFORMATION(CONTINUED)For the six mon

256、ths ended 30 June 2020Commercial vehiclesPassenger vehiclesFinancing serviceCorporate and others EliminationTotalRMB millionRMB millionRMB millionRMB millionRMB millionRMB million(Unaudited)(Unaudited)(Unaudited)(Unaudited)(Unaudited)(Unaudited)Segment revenueSales to external customers39,2797,5553,

257、44030250,576Sales to internal customers3551393(128)39,3147,6063,479305(128)50,576 ResultsSegment results1,474(2,927)1,197(749)706(299)Interest income348692691(742)368Finance expenses(599)Share of profits and losses of:Associates1140342811853Joint ventures1423,01298(28)3,224 Profit before income tax3

258、,547Income tax expense(792)Profit for the period2,755 The revenue from the transfer of goods are mainly recognized at a point in time.Dongfeng Motor Group Company Limited39For the six months ended 30 June 2020Notes to Interim Condensed Consolidated Financial Information(Continued)2.REVENUE AND SEGME

259、NT INFORMATION(CONTINUED)For the six months ended 30 June 2019Commercial vehiclesPassenger vehiclesFinancing serviceCorporate and othersEliminationTotalRMB millionRMB millionRMB millionRMB millionRMB millionRMB million(Unaudited)(Unaudited)(Unaudited)(Unaudited)(Unaudited)(Unaudited)Segment revenueS

260、ales to external customers32,34913,5632,39613948,447Sales to internal customers1588(103)32,36413,5632,484139(103)48,447 ResultsSegment results1,329(1,063)1,174(805)3921,027 Interest income3771054443(480)449Finance expenses(166)Share of profits and losses of:Associates1,720194181,932Joint ventures393

261、6,611147(366)6,785 Profit before income tax10,027Income tax expense(1,174)Profit for the period8,853 The revenue from the transfer of goods are mainly recognized at a point in time.2020 Interim Report40For the six months ended 30 June 2020Notes to Interim Condensed Consolidated Financial Information

262、(Continued)3.OTHER INCOMESix months ended 30 June 20202019RMB millionRMB million(Unaudited)(Unaudited)Investment income from disposal of investments in joint ventures and associates4915Interest income368449Government grants and subsidies125119Stationing fee received from the joint ventures125132Othe

263、rs446167 1,555872 4.PROFIT BEFORE INCOME TAXThe Groups profit before income tax is arrived at after charging:Six months ended 30 June 20202019RMB millionRMB million(Unaudited)(Unaudited)Cost of inventories recognized as expense39,85138,575Interest expense for financing services(included in cost of s

264、ales)258149Provision against inventories8012Depreciation of property,plant and equipment993965Amortisation of intangible assets438342Depreciation of right-of-use assets11139Impairment losses on financial assets967536 Dongfeng Motor Group Company Limited41For the six months ended 30 June 2020Notes to

265、 Interim Condensed Consolidated Financial Information(Continued)5.FINANCE EXPENSESSix months ended 30 June 20202019RMB millionRMB million(Unaudited)(Unaudited)Interest expenses on bank loans and other borrowings421134Interest expenses on lease liabilities5361Exchange net gain of financing activities

266、125(29)Finance expenses599166 6.IMPAIRMENT LOSSES ON FINANCIAL ASSETSSix months ended 30 June 20202019RMB millionRMB million(Unaudited)(Unaudited)Impairment losses of trade receivables183201Impairment losses of other receivables3311Impairment losses of loans and receivables from financing services75

267、1324 967536 2020 Interim Report42For the six months ended 30 June 2020Notes to Interim Condensed Consolidated Financial Information(Continued)7.OTHER EXPENSESix months ended 30 June 20202019RMB millionRMB million(Unaudited)(Unaudited)Impairment losses of non-financial assets1,614Research costs1,7891

268、,819Others1,035216 4,4382,035 8.INCOME TAX EXPENSESix months ended 30 June 20202019RMB millionRMB million(Unaudited)(Unaudited)Current income tax743632Deferred income tax49542 Income tax expense for the period7921,174 Under the PRC Corporate Income Tax Law and the respective regulations,the corporat

269、e income tax for the Company,its subsidiaries and jointly-controlled entities is calculated at the rates ranging from 15%to 25%,on their estimated assessable profits for the existing legislation,interpretations and practices in respect thereof.No provision for Hong Kong profits tax has been made as

270、the Group had no assessable profits arising in Hong Kong during the six months ended 30 June 2020 and 30 June 2019.Deferred tax assets were mainly recognized in respect of temporary differences relating to certain future deductible expenses or tax loss for the purpose of corporate income tax.Accordi

271、ng to IAS 12 Income Taxes,deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the periods when the assets are realized or the liabilities are settled.Dongfeng Motor Group Company Limited43For the six months ended 30 June 2020Notes to Interim Condens

272、ed Consolidated Financial Information(Continued)9.DIVIDENDSix months ended 30 June 20202019RMB millionRMB million(Unaudited)(Unaudited)Proposed interim dividend RMB0.10 (2019:RMB0.10)per ordinary share862862 On 28 August 2020,the Board of Directors has declared an interim dividend of RMB0.10 per sha

273、re(2019:RMB0.10 per share),amounting to 862 million(2019:RMB862 million).The interim financial information does not reflect this liability.A dividend of RMB2,154 million that was related to the period to 31 December 2019 has been distributed on Tuesday,25 August 2020.10.EARNINGS PER SHARE ATTRIBUTAB

274、LE TO ORDINARY EQUITY HOLDERS OF THE COMPANYThe calculation of basic earnings per share is based on:Six months ended 30 June 20202019RMB millionRMB million(Unaudited)(Unaudited)Earnings:Profit for the period attributable to ordinary equity holders of the Company3,0188,499 Number of shares millionmil

275、lionShares:Weighted average number of ordinary shares in issue during the period8,6168,616 Earnings per share35.03 cents98.64 cents Diluted earnings per share equals basic earnings per share as the Company has no dilutive potential ordinary shares for the six months ended 30 June 2020 and 30 June 20

276、19.2020 Interim Report44For the six months ended 30 June 2020Notes to Interim Condensed Consolidated Financial Information(Continued)11.PROPERTY,PLANT AND EQUIPMENTDuring the six months ended 30 June 2020,the Group acquired property,plant and equipment in an aggregate amount of approximately RMB3,87

277、2 million(2019:RMB1,897 million)and disposed of property,plant and equipment with an aggregate net book value of approximately 59 million(2019:RMB377 million),the net gain on disposal is less than 1 million(2019:a net gain RMB16 million).Depreciation was approximately 993 million(2019:RMB965 million

278、)and approximately 407 million impairment was accrued for the six months ended 30 June 2020(2019:no impairment was accrued).12.TRADE RECEIVABLESSales of the Groups commercial and passenger vehicles are normally settled on an advance receipt basis,whereby the dealers are required to pay in advance ei

279、ther in cash or by bank acceptance drafts.However,in the case of long-standing customers with bulk purchases and a good repayment history,the Group may offer these customers credit terms that are generally between 30 and 180 days.For sales of engines and other automotive parts,the Group generally of

280、fers their customers credit terms that are generally between 30 and 180 days.Trade receivables are non-interest bearing.An aging analysis of the trade receivables,net of provision for impairment of the Group,based on the invoice date,is as follows:30 June 202031 December 2019RMB million RMB million(

281、Unaudited)Within three months6,6407,431More than three months but within one year2,4442,204More than one year1,5371,055 10,62110,690 Dongfeng Motor Group Company Limited45For the six months ended 30 June 2020Notes to Interim Condensed Consolidated Financial Information(Continued)13.CASH AND CASH EQU

282、IVALENTS AND PLEDGED BANK BALANCES AND TIME DEPOSITS30 June 202031 December 2019RMB million RMB million(Unaudited)Cash and bank deposits31,49224,958Time deposits5,3805,127 36,87230,085Less:Pledged bank balances and time deposits for securing general banking facilities(4,089)(3,317)Cash and bank bala

283、nces in the interim condensed consolidated statement of financial position32,78326,768Less:Non-pledged time deposits with original maturity of three months or more when acquired(775)(635)Cash and cash equivalents in the interim condensed consolidated statement of cash flow32,00826,133 14.TRADE PAYAB

284、LESAn aging analysis of the trade payables of the Group,based on the invoice date,is as follows:30 June 202031 December 2019RMB million RMB million(Unaudited)Within three months21,98117,536More than three months but within one year1,2601,094More than one year701590 23,94219,220 2020 Interim Report46

285、For the six months ended 30 June 2020Notes to Interim Condensed Consolidated Financial Information(Continued)15.INTEREST-BEARING BORROWINGSInterest expense on borrowings for the six months ended 30 June 2020 was 421 million(2019:RMB134 million).The Asset-Backed Security(ABS)with fixed interest rates

286、 were public issued in amount of RMB1,845 million on 16 January 2019,The ABS is divided into tranche A,tranche B.Tranche A,B bear interest from 18 January 2019 at the rate of 3.37%,3.69%.Interest on the securities is payable monthly on 26th.The Company has already repaid RMB1,803 million by the end

287、of by the end of 30 June 2020.The Asset-Backed Security(ABS)with fixed interest rates were public issued in amount of RMB2,726 million on 17 July 2019,The ABS is divided into tranche A1,tranche A2 and tranche B.Tranche A1,A2,B bear interest from 19 July 2019 at the rate of 3.03%,3.19%and 4%.Interest

288、 on the securities is payable monthly on 26th.The company has already repaid RMB1,730 million by the end of 30 June 2020.The Asset-Backed Security(ABS)with fixed interest rates were public issued in amount of RMB4,350 million on 21 October 2019,The ABS is divided into tranche A1 and tranche A2.Tranc

289、he A1,A2 bear interest from 23 October 2019 at the rate of 2.9%and 3.12%.Interest on the securities is payable monthly on 26th.The company has already repaid RMB2,959 million by the end of 30 June 2020.The Asset-Backed Security(ABS)with fixed interest rates were public issued in amount of RMB1,710 m

290、illion on 14 January 2020,The ABS is divided into tranche A1 and tranche A2.Tranche A1,A2 bear interest from 16 January 2020 at the rate of 2.91%and 3.05%.Interest on the securities is payable monthly on 26th.The company has already repaid RMB627 million by the end of 30 June 2020.Dongfeng Motor Gro

291、up Company Limited47For the six months ended 30 June 2020Notes to Interim Condensed Consolidated Financial Information(Continued)15.INTEREST-BEARING BORROWINGS(CONTINUED)The Asset-Backed Security(ABS)with fixed interest rates were public issued in amount of RMB4,430 million on 20 May 2020,The ABS is

292、 divided into tranche A,tranche B.Tranche A,B bear interest from 22 May 2020 at the rate of 2.05%,2.55%.Interest on the securities is payable monthly on 26th.The Guaranteed notes(the“Notes”)were issued in the aggregate principal amount of EUR100 million on 23 October 2018 and were registered in the

293、denomination of EUR100,000 each and to be expired in 5 years.The Notes bear interest from 23 October 2018 at the rate of 1.606%per annum.Interest on the Notes is payable annually on 23 October each year.The Notes have been listed on the Irish Stock Exchange.The Guaranteed notes(the“Notes”)were issue

294、d in the aggregate principal amount of EUR500 million on 23 October 2018 and were registered in the denomination of EUR100,000 each and to be expired in 3 years.The Notes bear interest from 23 October 2018 at the rate of 1.150%per annum.Interest on the Notes is payable annually on 23 October each ye

295、ar,commencing with the first interest payment date falling on 23 October 2018.The Notes have been listed on the Irish Stock Exchange.The Unsecured notes(the“Notes”)were public issued in amount of RMB300 million on 30 January 2018 and were offered in the denomination of RMB100 each and to be expired

296、in 3 years.The Notes bear interest from 31 January 2018 at the rate of 5.49%per annum.Interest on the Notes is payable annually on 31 January each year.The Notes have been listed on the Shanghai Stock Exchange.The Unsecured notes(the“Notes”)were public issued in amount of RMB2,000 million on 5 Decem

297、ber 2018 and were offered in the denomination of RMB100 each and to be expired in 3 years.The Notes bear interest from 6 December 2018 at the rate of 3.96%per annum.Interest on the Notes is payable annually on 6 December each year.The Notes have been listed on the Shanghai Stock Exchange.The Unsecur

298、ed notes(the“Notes”)were public issued in amount of RMB1,000 million on 5 December 2018 and were offered in the denomination of RMB100 each and to be expired in 5 years.The Notes bear interest from 6 December 2018 at the rate of 4.21%per annum.Interest on the Notes is payable annually on 6 December

299、each year.The Notes have been listed on the Shanghai Stock Exchange.2020 Interim Report48For the six months ended 30 June 2020Notes to Interim Condensed Consolidated Financial Information(Continued)15.INTEREST-BEARING BORROWINGS(CONTINUED)The Unsecured notes(the“Notes”)were public issued in amount o

300、f RMB2,700 million on 20 March 2019 and were offered in the denomination of RMB100 each and to be expired in 3 years.The Notes bear interest from 21 March 2019 at the rate of 3.78%per annum.Interest on the Notes is payable annually on 21 March each year.The Notes have been listed on the Shanghai Sto

301、ck Exchange.The Unsecured notes(the“Notes”)were public issued in amount of RMB4,000 million on 16 October 2019 and were offered in the denomination of RMB100 each and to be expired in 3 years.The Notes bear interest from 17 October 2019 at the rate of 3.58%per annum.Interest on the Notes is payable

302、annually on 17 October each year.The Notes have been listed on the Shanghai Stock Exchange.The Unsecured notes(the“Notes”)were public issued in amount of RMB3,000 million on 26 February 2020 and were offered in the denomination of RMB100 each and to be expired in 3 years.The Notes bear interest from

303、 27 February 2020 at the rate of 3.05%per annum.Interest on the Notes is payable annually on 27 December each year.The Notes have been listed on the Shanghai Stock Exchange.16.COMMITMENTSThe Group had the following capital commitments at the end of the reporting period:30 June 202031 December 2019RM

304、B million RMB million(Unaudited)Contracted,but not provided for:Property,plant and equipment1,1351,426 Dongfeng Motor Group Company Limited49For the six months ended 30 June 2020Notes to Interim Condensed Consolidated Financial Information(Continued)17.RELATED PARTY TRANSACTIONS(a)Transactions with

305、DMC,its subsidiaries,associates and joint ventures,the Groups joint ventures and associates,non-controlling shareholders of a subsidiary and their subsidiaries and subsidiaries joint venturesSave as disclosed elsewhere in this interim condensed consolidated financial information,during the six month

306、s ended 30 June 2020,the Group had the following significant transactions with its related parties:Six months ended 30 June 20202019RMB millionRMB million(Unaudited)(Unaudited)Purchases of automotive parts/raw materials from and the payment of royalty fee to:DMC,its subsidiaries,associates and joint

307、 ventures367357Joint ventures6,9037,733Associates5731Subsidiaries joint ventures2,4672,230Non-controlling shareholders of a subsidiary and their subsidiaries128 9,80610,359 Purchases of automobiles from:Joint ventures1,8875,989DMC,its subsidiaries,associates and joint ventures1Subsidiaries joint ven

308、tures2 1,8895,990 2020 Interim Report50For the six months ended 30 June 2020Notes to Interim Condensed Consolidated Financial Information(Continued)Six months ended 30 June 20202019RMB millionRMB million(Unaudited)(Unaudited)Purchases of water,steam and electricity from DMC358 Purchases of items of

309、property,plant and equipment and intangible assets from:DMC,its subsidiaries,associates and joint ventures92Joint ventures197112 206114 Purchases of services from:DMC,its subsidiaries,associates and joint ventures301310Joint ventures170367Non-controlling shareholders of a subsidiary and their subsid

310、iaries1843 489720 17.RELATED PARTY TRANSACTIONS(a)Transactions with DMC,its subsidiaries,associates and joint ventures,the Groups joint ventures and associates,non-controlling shareholders of a subsidiary and their subsidiaries and subsidiaries joint ventures(Continued)Dongfeng Motor Group Company L

311、imited51For the six months ended 30 June 2020Notes to Interim Condensed Consolidated Financial Information(Continued)17.RELATED PARTY TRANSACTIONS(a)Transactions with DMC,its subsidiaries,associates and joint ventures,the Groups joint ventures and associates,non-controlling shareholders of a subsidi

312、ary and their subsidiaries and subsidiaries joint ventures(Continued)Six months ended 30 June 20202019RMB millionRMB million(Unaudited)(Unaudited)Sales of automotive parts/raw materials to:DMC,its subsidiaries,associates and joint ventures7655Joint ventures1,8751,925Associates5Subsidiaries joint ven

313、tures119 1,9671,989 Sales of automobiles to:DMC,its subsidiaries,associates and joint ventures490828Joint ventures90268Non-controlling shareholder of a subsidiary and their subsidiaries448765 1,0281,861 Provision of services to:DMC,its subsidiaries,associates and joint ventures42Joint ventures9533As

314、sociates1Subsidiaries joint ventures22 10237 2020 Interim Report52For the six months ended 30 June 2020Notes to Interim Condensed Consolidated Financial Information(Continued)Six months ended 30 June 20202019RMB millionRMB million(Unaudited)(Unaudited)Interest expense paid to:DMC,its subsidiaries,as

315、sociates and joint ventures935Joint ventures5545Non-controlling shareholder of a subsidiary and their subsidiaries5 14855 Interest incomes from:DMC,its subsidiaries,associates and joint ventures1218Joint ventures2351Associates1Subsidiaries joint ventures33 3873 Fee and commission incomes from joint

316、ventures54 Dispatch Fee received from joint ventures125132 Interest expenses of lease liabilities to DMC5462 17.RELATED PARTY TRANSACTIONS(a)Transactions with DMC,its subsidiaries,associates and joint ventures,the Groups joint ventures and associates,non-controlling shareholders of a subsidiary and

317、their subsidiaries and subsidiaries joint ventures(Continued)Dongfeng Motor Group Company Limited53For the six months ended 30 June 2020Notes to Interim Condensed Consolidated Financial Information(Continued)17.RELATED PARTY TRANSACTIONS(CONTINUED)(b)Outstanding balances with related parties30 June

318、202031 December 2019RMB million RMB million(Unaudited)Receivables from related parties included in trade receivables:DMC,its subsidiaries,associates and joint ventures227155Associates1024Non-controlling shareholders of a subsidiary and their subsidiaries178218 415397 Receivables from related parties

319、 included in prepayments,deposits,other receivables:DMC,its subsidiaries,associates and joint ventures500436Associates3156Non-controlling shareholders of a subsidiary and their subsidiaries24 505596 Receivables from related parties included in other non-current assets:DMC,its subsidiaries,associates

320、 and joint ventures210210Associates701988 9111,198 2020 Interim Report54For the six months ended 30 June 2020Notes to Interim Condensed Consolidated Financial Information(Continued)30 June 202031 December 2019RMB million RMB million(Unaudited)Payables to related parties included in trade payables:DM

321、C,its subsidiaries,associates and joint ventures532321Associates53109Non-controlling shareholders of a subsidiary and their subsidiaries134 598434 Payables to related parties included in other payables and accruals and contract liabilities:DMC,its subsidiaries,associates and joint ventures253346Asso

322、ciates1Non-controlling shareholders of a subsidiary and their subsidiaries86145 339492 Payables to DMC,its subsidiaries,associates and joint ventures included in lease liabilities:2,0412,042 Payables to non-controlling shareholders of a subsidiary and their subsidiaries included in other long term l

323、iabilities:135147 Payables to related parties included in Interest-bearing borrowingsDMC,its subsidiaries,associates and joint ventures6,8146,113Associates157Non-controlling shareholders of a subsidiary and their subsidiaries38 6,8296,158 17.RELATED PARTY TRANSACTIONS(CONTINUED)(b)Outstanding balanc

324、es with related parties(Continued)Dongfeng Motor Group Company Limited55For the six months ended 30 June 2020Notes to Interim Condensed Consolidated Financial Information(Continued)17.RELATED PARTY TRANSACTIONS(CONTINUED)(c)Compensation of key management personnel of the GroupSix months ended 30 Jun

325、e 20202019RMB thousandRMB thousand(Unaudited)(Unaudited)Short-term employee benefits4,3862,489Post-employment benefits121159 Total compensation to key management personnel4,5072,648 2020 Interim Report56DefinitionsIn this interim report,unless the context otherwise requires,the following terms shall

326、 have the meanings set out below.“the Company”東風汽車集團股份有限公司(Dongfeng Motor Group Company Limited),a joint stock limited company registered in the PRC on 12 October 2004 in accordance with the laws of the PRC or where the context refers to any time prior to the date of incorporation,those entities and

327、 businesses which were contributed to and conducted by the Company upon its establishment;“Dongfeng Joint Venture Companies”Jointly-controlled Entities in which the Company,its subsidiaries or Jointly-controlled Entities(including their respective subsidiaries and Jointly-controlled Entities)have eq

328、uity interests as at 30 June 2020.“the Group”or“Dongfeng Motor Group”the Company and its subsidiaries,Dongfeng Joint Venture Companies and their respective subsidiaries and associates.“Joint Venture”A joint venture is a type of joint arrangement whereby the parties that have joint control of the arr

329、angement have rights to the net assets of the joint venture.Joint control,is the contractually agreed sharing of control of an arrangement,which exists only when decisions about the relevant activities require the unanimous consent of the parties sharing control.“Dongfeng Motor Corporation”or“DMC”東風

330、汽車集團有限公司(Dongfeng Motor Corporation),a state-owned enterprise incorporated under the laws of the PRC and the Controlling Shareholder of the Company.“PRC”or“China”the Peoples Republic of China.Except where the context requires,geographical references in this interim report to the PRC or China exclude

331、 Hong Kong,Macau or Taiwan“Hong Kong”the Hong Kong Special Administrative Region of the PRC;“Listing Rules”the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited,as amended from time to time;“Securities and Futures Ordinance”the Securities and Futures Ordinance(Chapter 571 of the Laws of Hong Kong),as amended,supplemented or otherwise modified from time to time.