Hengan International : ANNUAL REPORT 2018

ANNUAL REPORT

2018

CORPORATE MISSION

"GROWING WITH YOU

FOR A BETTER LIFE"

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Has always been the mission of Hengan International. We will continue to adhere to our corporate spirit of "Integrity, Diligence, Innovation and Dedication". Our goal is "to build an effective corporate management and to develop a quality, ethical and enthusiastic staff team". By building an excellent corporate culture, reinforcing our brand image, and focusing on consumer and market need, Hengan International will become China's leading corporation in manufacturing and distribution of fast moving family consumer products.

Corporate Information 02

Financial Highlights 03

Five-Year Financial Summary 04

Company Product Series 06

Chairman's Statement 08

Chief Executive Officer's Report 11

Directors and Senior Management Profiles 21

Corporate Governance Report 25

Report of the Directors 34

Independent Auditor's Report 45

Consolidated Statement of Profit or Loss 50

Consolidated Statement of Comprehensive Income 51

Consolidated Balance Sheet 52

Consolidated Statement of Changes in Equity 54

Consolidated Cash Flow Statement 55

Notes to the Consolidated Financial Statements 56

CORPORATE INFORMATION

EXECUTIVE DIRECTORS

Sze Man Bok (Chairman)

Hui Lin Chit (Deputy Chairman and Chief Executive Officer) Hung Ching Shan

• Xu Shui Shen

• Xu Da Zuo

• Xu Chun Man Sze Wong Kim Hui Ching Chi Li Wai Leung

INDEPENDENT NON-EXECUTIVE DIRECTORS

Chan Henry

Wang Ming Fu Ada Ying Kay Wong Ho Kwai Ching Mark Zhou Fang Sheng

HEAD OFFICE

Hengan Industrial City Anhai Town

Jinjiang City Fujian Province PRC

PLACE OF BUSINESS IN HONG KONG

Unit 2101D, 21st Floor

Admiralty Centre, Tower 1 18 Harcourt Road

Hong Kong

PLACE OF LISTING AND STOCK CODE

The Stock Exchange of Hong Kong Limited

Stock Code: 1044

COMPANY SECRETARY

Li Wai Leung FCPA

AUTHORISED REPRESENTATIVES

Hui Lin Chit

Li Wai Leung

LEGAL ADVISERS

Hong Kong

ReedSmith Richards Butler

PRC

Global Law Office

Cayman Islands

Maples and Calder (Hong Kong) LLP

AUDITOR

PricewaterhouseCoopers Certified Public Accountants

REGISTERED OFFICE

P.O. Box 309

Ugland House Grand Cayman KY1-1104

British West Indies

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HENGAN INTERNATIONAL GROUP COMPANY LIMITED Annual Report 2018

WEBSITES

http://www.hengan.comhttp://www.irasia.com/listco/hk/hengan

PRINCIPAL BANKERS

Bank of China

China Construction Bank

Industrial and Commercial Bank of China Industrial Bank

PRINCIPAL SHARE REGISTRAR AND TRANSFER AGENT

SMP Partners (Cayman) Limited Royal Bank House - 3rd Floor 24 Shedden Road, P.O. Box 1586 Grand Cayman, KY1-1110 Cayman Islands

BRANCH SHARE REGISTRAR AND TRANSFER OFFICE

Tricor Abacus Limited Level 22, Hopewell Centre 183 Queen's Road East Hong Kong

INVESTORS AND MEDIA RELATIONS

iPR Ogilvy Ltd.

Units 2008-12, 20/F, The Centre 99 Queen's Road

Central Hong Kong

FINANCIAL HIGHLIGHTS

2018	2017	2016	2015	2014
(Restated)
18.5	21.0	18.0	17.3	16.4
Earnings per share - basic (RMB)	3.151	3.149	2.864	2.645	2.525
Finished goods turnover (days)	41	46	46	43	49
Trade receivables turnover (days) (Note)	46	51	47	40	35
Current ratio (times)	1.3	1.3	1.4	1.2	1.5
Gross gearing ratio (%)	145.1	118.5	108.1	98.8	115.3
Net gearing ratio (%)	(9.9)	(11.5)	(4.9)	(7.9)	(10.3)

Note:

The financial highlights for the year ended 31 December 2018 were presented according to Hong Kong Financial Reporting Standard 15 and comparatives for the year ended 31 December 2017 have been restated accordingly. The financial highlights prior to 2017 have not been restated.

ANALYSIS OF REVENUE BY PRODUCT

10.5%

8.1%

Tissue paper products

Disposable diapers productsSanitary napkins productsOthers

HENGAN INTERNATIONAL GROUP COMPANY LIMITED

Annual Report 2018

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