Sun Art Retail : FINANCIAL RESULTS ANNOUNCEMENT FOR THE FIFTEEN MONTHS ENDED 31 MARCH 2021

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SUN ART RETAIL GROUP LIMITED

高鑫零售有限公司

(Incorporated in Hong Kong with limited liability)

(Stock code: 6808)

FINANCIAL RESULTS ANNOUNCEMENT FOR

THE FIFTEEN MONTHS ENDED 31 MARCH 2021

HIGHLIGHTS OF ANNUAL RESULTS
	For
	the fifteen	For
	months ended	the year ended
	31 March	31 December
	2021	2019	Change
	RMB million
Revenue	124,334	95,357	30.4%
Gross Profit	31,087	25,731	20.8%
Profit from Operations	5,757	4,890	17.7%
Profit for the Period/Year	3,771	3,045	23.8%
Profit Attributable to	3,572
Equity Shareholders of the Company	2,834	26.0%
Earnings Per Share ("EPS")	RMB0.37
- Basic and diluted (1)	RMB0.30
	At	At
	31 March	31 December
	2021	2019	Change
	RMB million
Total Assets	69,227	71,186	(2.8)%
Total Liabilities	41,373	45,828	(9.7)%
Net Assets	27,854	25,358	9.8%
Net Cash Position (2)	20,116	13,267	51.6%

Notes:

1. The calculation of basic and diluted EPS for the fifteen months ended 31 March 2021 and for the year ended 31 December 2019 is based on the weighted average number of 9,539,704,700 ordinary shares in issue during the periods.
2. The balance of net cash position is calculated as the sum of cash and cash equivalents, financial assets measured at fair value through profit or loss and time deposits minus bank loans.

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The board (the "Board") of directors (the "Directors") of Sun Art Retail Group Limited (the "Company", together with its subsidiaries, the "Group") is pleased to announce the audited consolidated results of the Group for the fifteen months ended 31 March 2021, together with the comparative figures for the year ended 31 December 2019 which have been prepared in accordance with Hong Kong Financial Reporting Standards ("HKFRSs") as below.

CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND

OTHER COMPREHENSIVE INCOME

For the fifteen months ended 31 March 2021 - Audited

		For
		the fifteen	For
		months ended	the year ended
		31 March	31 December
		2021		2019
	Notes	RMB million	RMB million
Revenue	4	124,334		95,357
Cost of sales		(93,247)	(69,626)
Gross profit		31,087		25,731
Other income	5	2,065		1,489
Operating costs		(24,204)	(19,523)
Administrative expenses		(3,191)	(2,807)
Profit from operations		5,757		4,890
Finance costs	6(a)	(680)	(623)
Share of results of associates and joint ventures		(3)	(15)
Profit before taxation	6	5,074		4,252
Income tax	7(a)	(1,303)	(1,207)
Profit for the period/year		3,771		3,045
Other comprehensive income for the period/year		-	-
Total comprehensive income for the period/year		3,771		3,045
Profit attributable to:
	3,572
Equity shareholders of the Company			2,834
Non-controlling interests		199		211
Profit for the period/year		3,771		3,045
Total comprehensive income attributable to:
	3,572
Equity shareholders of the Company			2,834
Non-controlling interests		199		211
Total comprehensive income for the period/year		3,771		3,045
Earnings per share
	RMB0.37
Basic and diluted	8	RMB0.30

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CONSOLIDATED STATEMENT OF FINANCIAL POSITION

At 31 March 2021 - Audited

		At		At
		31 March		31 December
		2021	2019
	Notes	RMB million		RMB million
Non-current assets
Investment properties		6,239	6,699
Other property, plant and equipment		27,149	28,572
		33,388	35,271
Intangible assets		29	25
Goodwill		140	99
Equity-accounted investees		2	17
Deferred tax assets		1,126		1,052
		34,685	36,464
Current assets
Inventories	10	9,990	17,724
Trade and other receivables	11	3,267	2,962
Time deposits		18	16
Restricted deposits		1,169	769
Financial assets measured at FVPL	12	12,002		-
Cash and cash equivalents	13	8,096	13,251
		34,542	34,722
Current liabilities
Trade and other payables	14	20,644	25,827
Lease liabilities	15	1,169	1,057
Contract liabilities	16	11,984	10,669
Income tax payables	7(c)	319	459
		34,116	38,012
Net current assets/(liabilities)		426	(3,290)
Total assets less current liabilities		35,111	33,174

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CONSOLIDATED STATEMENT OF FINANCIAL POSITION (CONTINUED)

At 31 March 2021 - Audited

		At		At
		31 March		31 December
		2021	2019
	Note	RMB million		RMB million
Non-current liabilities
Lease liabilities	15	6,882	7,511
Other financial liabilities		50	50
Deferred tax liabilities		325		255
		7,257	7,816
Net assets		27,854	25,358
Capital and reserves
Share capital		10,020	10,020
Reserves		16,203	13,905
Total equity attributable to
equity shareholders of the Company		26,223	23,925
Non-controlling interests		1,631	1,433
Total equity		27,854	25,358

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NOTES:

(Expressed in Renminbi ("RMB") unless otherwise stated)

1. STATEMENT OF COMPLIANCE
   Sun Art Retail Group Limited is a company incorporated in Hong Kong on 13 December 2000 with limited liability. The Company's shares were listed on the Main Board of The Stock Exchange of Hong Kong Limited (the "Stock Exchange") on 27 July 2011.
   On 22 December 2020, the Company announced to change its financial year end date from 31 December to 31 March to enable better operational alignment between the Company and Alibaba Group, the ultimate holding company, and to facilitate the synergy across all functions within the Alibaba Group. Accordingly, the current financial year covers a fifteen-month period from 1 January 2020 to 31 March 2021 with the comparative financial period from 1 January 2019 to 31 December 2019.
   The Group's consolidated financial statements have been prepared in accordance with all applicable HKFRSs, which collective term includes all applicable individual HKFRSs, Hong Kong Accounting Standards ("HKASs") and Interpretations issued by the Hong Kong Institute of Certified Public Accountants (the "HKICPA"), accounting principles generally accepted in Hong Kong and the requirements of Hong Kong Companies Ordinance (Chapter 622 of the laws of Hong Kong) (the "Companies Ordinance"). These consolidated financial statements also comply with the applicable disclosure provisions of the Rules Governing the Listing of Securities (the "Listing Rules") on Stock Exchange.
   The HKICPA has issued certain new and revised HKFRSs that are first effective or available for early adoption for the current accounting period of the Group and the Company. Note 3 provides information on any changes in accounting policies resulting from initial application of these developments to the extent that they are relevant to the Group for the current and prior accounting periods reflected in these consolidated financial statements.
   The financial information relating to the fifteen months ended 31 March 2021 and year ended 31 December 2019 included in this preliminary announcement of annual results does not constitute the Company's statutory annual consolidated financial statements for those years but is derived from those financial statements. Further information relating to these statutory financial statements required to be disclosed in accordance with section
   436 of the Companies Ordinance is as follows:
   The Company has delivered the financial statements for the year ended 31 December 2019 to the Registrar of Companies as required by section 662(3) of, and Part 3 of Schedule 6 to, the Companies Ordinance and will deliver the financial statements for the fifteen months ended 31 March 2021 in due course.
   The Company's auditor has reported on the financial statements of the Group for both years. The auditor's reports were unqualified; did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying its reports; and did not contain a statement under section 406(2), 407(2) or (3) of the Companies Ordinance.
2. BASIS OF PREPARATION OF THE FINANCIAL STATEMENTS
   The consolidated financial statements for the fifteen months ended 31 March 2021 comprise the Group and the Group's interest in associates and joint ventures.
   The consolidated financial statements are presented in Renminbi ("RMB"), rounded to the nearest million (unless otherwise stated). RMB is also the functional currency of the Company and the Company's operating subsidiaries, as the Group's brick-and-mortar stores and online sales channels are all operated in the People's Republic of China ("PRC"). The consolidated financial statements have been prepared on the historical cost basis except for derivative financial instruments that are measured at fair value.

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