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CMT Interim / Quarterly Report 2020

Dec 14, 2020

52166_rns_2020-12-14_678d3d83-2f48-41a8-a961-93dadff52bbd.pdf

Interim / Quarterly Report

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1

Stock Code:2612

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES

Consolidated Financial Statements

With Independent Auditors’ Review Report For the Nine Months Ended September 30, 2020 and 2019

Address: 4F., NO15, Sec. 1, Jinan Rd., Taipei City, Taiwan (R.O.C) Telephone: (02)2396-3282

The independent auditors’ review report and the accompanying consolidated financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ review report and consolidated financial statements, the Chinese version shall prevail.

2

Table of contents

Contents
1. Cover Page
2. Table of Contents
3. Independent Auditors’ Review Report
4. Consolidated Balance Sheets
5. Consolidated Statements of Comprehensive Income
6. Consolidated Statements of Changes in Equity
7. Consolidated Statements of Cash Flows
8. Notes to the Consolidated Financial Statements
(1)
Company history
(2)
Approval date and procedures of the consolidated financial statements
(3)
New standards, amendments and interpretations adopted
(4)
Summary of significant accounting policies
(5)
Significant accounting assumptions and judgments, and major sources
of estimation uncertainty
(6)
Explanation of significant accounts
(7)
Related-party transactions
(8)
Pledged assets
(9)
Commitments and contingencies
(10) Losses Due to Major Disasters
(11) Subsequent Events
(12) Other
(13) Other disclosures
(a) Information on significant transactions
(b) Information on investees
(c) Information on investment in mainland China
(d) Major shareholders
(14) Segment information		 Page
1
2
3
4
5
6
7
8
8
8～10
10～12
12～13
13～40
40～41
42
42
42
42
43
43～46
47
48
48
48～49

3

==> picture [169 x 19] intentionally omitted <==

KPMG

台北市110615信義路5段7號68樓(台北101大樓) Telephone 電話 + 886 2 8101 6666 68F., TAIPEI 101 TOWER, No. 7, Sec. 5, Fax 傳真 + 886 2 8101 6667 Xinyi Road, Taipei City 110615, Taiwan (R.O.C.) Internet 網址 home.kpmg/tw

Independent Auditors’ Review Report

To the Board of Directors of CHINESE MARITIME TRANSPORT LTD.:

Introduction

We have reviewed the accompanying consolidated balance sheets of Chinese Maritime Transport Ltd. and its subsidiaries as of September 30, 2020 and 2019, and the related consolidated statements of comprehensive income for the three months and nine months ended September 30, 2020 and 2019, as well as the changes in equity and cash flows for the nine months ended September 30, 2020 and 2019, and notes to the consolidated financial statements, including a summary of significant accounting policies. The management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34, “Interim Financial Reporting” endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China. Our responsibility is to express a conclusion on the consolidated financial statements based on our reviews.

Scope of Review

Except as explained in the Basis for Qualified Conclusion paragraph, we conducted our reviews in accordance with Statement of Auditing Standard 65, “ Review of Financial Information Performed by the Independent Auditor of the Entity”. A review of the consolidated financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with the generally accepted auditing standards and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Basis for Qualified Conclusion

As stated in Note (4)(b), the consolidated financial statements included the financial statements of certain nonsignificant subsidiaries, which were not reviewed by independent auditors. These financial statements reflect the total assets amounting to $1,780,814 thousand and $2,153,952 thousand, constituting 9.01% and 10.57% of the consolidated total assets; and the total liabilities amounting to $687,817 thousand and $825,114 thousand, constituting 6.90% and 8.18% of the consolidated total liabilities as of September 30, 2020 and 2019, respectively; as well as the total comprehensive income amounting to $11,919 thousand, $16,910 thousand, $28,601 thousand and $40,953 thousand, constituting 43.13%17.54%128.66% and 9.86% of the absolute value of the consolidated total comprehensive income for the three months and the nine months ended September 30, 2020 and 2019, respectively.

KPMG, a Taiwan partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee.

3-1

Furthermore, as stated in Note (6)(e), the other equity accounted investments of Chinese Maritime Transport Ltd. and its subsidiaries in its investee companies of $1,679,603 thousand and $1,738,978 thousand as of September 30, 2020 and 2019, respectively, and its equity in net earnings on these investee companies of $14,010 thousand, $20,409 thousand, $58,144 thousand and $52,715 thousand for the three months and the nine months ended September 30, 2020 and 2019, respectively, were recognized solely on the financial statements prepared by these investee companies, but not reviewed by independent auditors.

Qualified Conclusion

Except for the adjustments, if any, as might have been determined to be necessary had the financial statements of certain consolidated subsidiaries and equity accounted investee companies described in the Basis for Qualified Conclusion paragraph above been reviewed by independent auditors, based on our reviews, nothing has come to our attention that causes us to believe that the accompanying consolidated financial statements do not present fairly, in all material respects, the consolidated financial position of Chinese Maritime Transport Ltd. and its subsidiaries as of September 30, 2020 and 2019, and of its consolidated financial performance for the three months and nine months ended September 30, 2020 and 2019, as well as its consolidated cash flows for the nine months ended September 30, 2020 and 2019 in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and International Accounting Standard 34, “ Interim Financial Reporting” endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

The engagement partners on the reviews resulting in this independent auditors’ review report are Yiu-Kwan Au and Jui-Lan Lo.

KPMG

Taipei, Taiwan (Republic of China) November 13, 2020

Notes to Readers

The accompanying consolidated financial statements are intended only to present the consolidated statement of financial position, financial performance and cash flows in accordance with the accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to review such consolidated financial statements are those generally accepted and applied in the Republic of China.

The independent auditors’ review report and the accompanying consolidated financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ review report and consolidated financial statements, the Chinese version shall prevail.

4

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Reviewed only, not audited in accordance with the generally accepted auditing standards as of September 30, 2020 and 2019

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES

Consolidated Balance Sheets

September 30, 2020, December 31 and September 30, 2019 (Expressed in Thousands of New Taiwan Dollars)

Assets
Current assets:
1100
Cash and cash equivalents (note (6)(a))
1110
Current financial assets at fair value through profit o
loss (note (6)(b))
1150
Notes and accounts receivable, net (note (6)(d))
1180
Accounts receivable due from related parties, net
(notes (6)(d) and (7))
1470
Other current assets
1476
Other current financial assets (notes (6)(i) and (8))
Non-current assets:
1510
Non-current financial assets at fair value through
profit or loss (note (6)(b))
1517
Non-current financial assets at fair value through
other comprehensive income (notes (6)(c) and (8))
1550
Investments accounted for using equity method, net
(notes (6)(e) and (8))
1600
Property, plant and equipment (notes (6)(f) and (8))
1755
Right-of-use assets (note (6)(g))
1760
Investment property, net (note (6)(h))
1780
Intangible assets
1840
Deferred tax assets
1900
Other non-current assets
1980
Other non-current financial assets (notes (6)(i) and
(8))
Total assets		 September 30, 2020
Amount
%
$ 3,444,019
17
r
528,811
3
268,231
1
11,138
-
81,926
-
310,153
2
4,644,278
23
130,724
1
397,375
2
1,679,603
9
12,641,507
64
162,721
1
35,169
-
10,612
-
17,854
-
34,362
-
18,227
-
15,128,154
77
$
19,772,432
100		 December 31, 2019
Amount
%
3,288,046
17
14,050
-
273,636
1
16,770
-
62,481
-
304,029
2
3,959,012
20
119,554
-
315,134
2
1,698,801
9
13,549,411
68
218,783
1
35,995
-
11,659
-
17,854
-
8,626
-
21,790
-
15,997,607
80
19,956,619
100		 September 30, 2019
Amount
%
3,244,296
16
58,012
-
281,203
2
14,689
-
59,743
-
213,960
1
3,871,903
19
58,418
-
297,479
2
1,738,978
9
14,059,856
69
232,407
1
36,683
-
12,228
-
15,983
-
27,222
-
21,883
-
16,501,137
81
20,373,040
100
Liabilities and Equity
Current liabilities:
2100
Short-term borrowings (note (6)(j))
2130
Current contract liabilities (note (6)(q))
2150
Notes and accounts payable
2200
Other payables
2280
Current lease liabilities (note (6)(k))
2300
Other current liabilities
2320
Long-term liabilities, current portion (note (6)(j))
Non-Current liabilities:
2530
Bonds payable (note (6)(j))
2540
Long-term borrowings (note (6)(j))
2570
Deferred tax liabilities
2580
Non-current lease liabilities (note (6)(k))
2640
Net defined benefit liability, non-current
2670
Other non-current liabilities, others
Total liabilities
Equity attributable to owners of parent: (note
(6)(o))
3100
Common stock
3200
Capital surplus
Retained earnings:
3310
Legal reserve
3320
Special reserve
3350
Unappropriated retained earnings
3400
Other equity interest
Total equity
Total liabilities and equity		 September 30, 2020 December 31, 2019 December 31, 2019 September 30, 2019
Amount
%
1,429,676
7
20,601
-
179,181
1
127,776
1
52,309
-
45,887
-
1,076,626
5
2,932,056
14
2,700,000
13
3,633,863
18
603,271
3
179,110
1
37,674
-
899
-
7,154,817
35
10,086,873
49
1,974,846
11
53,411
-
1,715,537
8
359,487
2
6,324,802
31
8,399,826
41
(141,916)
(1)
10,286,167
51
20,373,040
100
Amount %
1,529,883
19,327
239,126
166,436
52,509
48,900
1,053,519
3,109,700
2,700,000
3,393,217
607,906
169,693
40,779
961
6,912,556
10,022,256
1,974,846
53,411
1,715,537
359,487
6,366,772
8,441,796

See accompanying notes to consolidated financial statements.

5

(English Translation of Consolidated Financial Statements Originally Issued in Chinese)

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income

For the three months and nine months ended September 30, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars, Except earnings per share)

4000
Operating Revenues (notes (6)(q), (7) and (14))
4621
Freight revenue-vessel chartering
4622
Freight revenue-container hauling and logistics revenue
4623
Freight revenue-airline agent and others
5000
Operating costs (notes (6) (m), (s) and (12))
5621
Freight cost-vessel chartering
5622
Freight cost-container hauling and logistics
5623
Freight cost-airline agent and others
5900
Gross profit
Operating expenses:
6000
Operating expenses (notes (6)(m), (s), (7) and (12))
6450
Impairment loss (impairment gain and reversal of impairment loss) determined in
accordance with IFRS 9 (note (6)(d))
6900
Net operating income
Non-operating income and expenses:
7010
Other income (note (6)(l))
7050
Finance costs (note (6)(r))
7060
Share of profit (loss) of associates and joint ventures accounted for using equity
method (note (6)(e))
7100
Interest income
7210
Gains (losses) on disposals of property, plant and equipment, net (note (6)(f))
7230
Foreign exchange gains or losses, net
7235
Gains (losses) on financial assets at fair value through profit or loss (note (6)(b))
7590
Miscellaneous disbursements
7900
Profit from continuing operations before tax
7950
Less: Income tax expenses (note (6)(n))
Profit (attributable to owners of parent)
8300
Other comprehensive income:
8310
Items that may not be reclassified subsequently to profit or loss
8316
Unrealized gains (losses) from investments in equity instruments measured at fair
value through other comprehensive income (note (6)(c))
8320
Share of other comprehensive income of associates and joint ventures accounted for
using equity method, components of other comprehensive income that will not be
reclassified to profit or loss
8360
Items that may be reclassified subsequently to profit or loss
8361
Exchange differences on translation
8370
Share of other comprehensive income of associates and joint ventures accounted for
using equity method, components of other comprehensive income that will be
reclassified to profit or loss
Total other comprehensive income that will be reclassified to profit or loss
8300
Other comprehensive income, net
Comprehensive income (attributable to owners of parent)
Earnings per share(note (6)(p))
9750
Basic net income per share (NT dollars)
9850
Diluted net income per share (NT dollars)		 For the three months ended September 30
2020
2019
Amount
%
Amount
%
$ 399,782
51
463,599
50
377,573
48
458,268
49
8,470
1
5,250
1
785,825
100
927,117
100
339,321
43
345,048
37
310,848
40
379,567
41
5,492
1
3,831
-
655,661
84
728,446
78
130,164
16
198,671
22
97,446
13
90,781
10
36
-
32
-
97,482
13
90,813
10
32,682
3
107,858
12
17,790
2
3,720
-
(32,442)
(4)
(57,914)
(6)
14,010
2
20,409
2
2,833
-
17,091
2
(5,859)
(1)
969
-
(278)
-
(189)
-
179,586
23
5,221
1
(30)
-
-
-
175,610
22
(10,693)
(1)
208,292
25
97,165
11
4,936
1
8,717
1
203,356
24
88,448
10
14,617
2
12,318
2
10,566
1
2,093
-
25,183
3
14,411
2
(174,977)
(22)
(5,968)
(1)
(25,924)
(3)
(500)
-
(200,901)
(25)
(6,468)
(1)
(175,718)
(22)
7,943
1
$
27,638
2
96,391
11
$
1.03
0.45
$
1.03
0.45		 For the nine months ended September 30
2020
2019
Amount
%
Amount
%
1,214,209
52
1,449,393
51
1,097,967
47
1,369,619
48
26,199
1
21,728
1
2,338,375
100
2,840,740
100
1,011,805
43
1,039,224
36
902,372
39
1,137,371
40
16,884
2
16,001
1
1,931,061
84
2,192,596
77
407,314
16
648,144
23
282,207
12
273,827
10
87
-
69
-
282,294
12
273,896
10
125,020
4
374,248
13
29,067
1
18,304
1
(118,016)
(5)
(185,729)
(7)
58,144
2
52,715
2
22,687
1
59,592
2
(3,955)
-
3,242
-
(3,211)
-
74
-
247,116
11
(3,607)
-
(318)
-
(948)
-
231,514
10
(56,357)
(2)
356,534
14
317,891
11
18,093
1
39,531
1
338,441
13
278,360
10
10,503
1
13,129
-
4,766
-
611
-
15,269
1
13,740
-
(287,808)
(12)
107,089
4
(43,672)
(2)
16,138
1
(331,480)
(14)
123,227
5
(316,211)
(13)
136,967
5
22,230
-
415,327
15
1.71
1.41
1.71
1.41
2020
Amount
%
$ 399,782
51
377,573
48
8,470
1
785,825
100
339,321
43
310,848
40
5,492
1
655,661
84
130,164
16
97,446
13
36
-
97,482
13
32,682
3
17,790
2
(32,442)
(4)
14,010
2
2,833
-
(5,859)
(1)
(278)
-
179,586
23
(30)
-
175,610
22
208,292
25
4,936
1
203,356
24
14,617
2
10,566
1
25,183
3
(174,977)
(22)
(25,924)
(3)
(200,901)
(25)
(175,718)
(22)
$
27,638
2
$
1.03
$
1.03		 2020
Amount
%
1,214,209
52
1,097,967
47
26,199
1
2,338,375
100
1,011,805
43
902,372
39
16,884
2
1,931,061
84
407,314
16
282,207
12
87
-
282,294
12
125,020
4
29,067
1
(118,016)
(5)
58,144
2
22,687
1
(3,955)
-
(3,211)
-
247,116
11
(318)
-
231,514
10
356,534
14
18,093
1
338,441
13
10,503
1
4,766
-
15,269
1
(287,808)
(12)
(43,672)
(2)
(331,480)
(14)
(316,211)
(13)
22,230
-
1.71
1.71

See accompanying notes to consolidated financial statements.

6

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Reviewed only, not audited in accordance with generally accepted auditing standards CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES

Consolidated Statements of Changes in Equity

For the nine months ended September 30, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

Equity attributable to owners of parent

Share capital
Ordinary
shares
Balance at January 1, 2019
$ 1,974,846
Legal reserve appropriated
-
Reversal of special reserve
-
Cash dividends of ordinary share
-
-
Net income for the nine months ended September 30, 2019
-
Other comprehensive income for the nine months ended September 30, 2019
-
Total comprehensive income for the nine months ended September 30, 2019
-
Balance at September 30, 2019
$
1,974,846
Balance at January 1,2020
$ 1,974,846
Legal reserve appropriated
-
Special reserve reversal
-
Cash dividends of ordinary share
-
-
Net income for the nine months ended September 30, 2020
-
Other comprehensive income for the nine months ended September 30, 2020
-
Total comprehensive income for the nine months ended September 30, 2020
-
Balance at September 30, 2020
$
1,974,846		 Share capital Capital
surplus		 Retained earnings Retained earnings Retained earnings Total other equity interest
Exchange
differences on
translation of
Unrealized
gains
(losses) from
financial assets
measured at
fair value
foreign
financial
statements
through other
comprehensive
income
Total other
equity
interest		 Total other equity interest
Exchange
differences on
translation of
Unrealized
gains
(losses) from
financial assets
measured at
fair value
foreign
financial
statements
through other
comprehensive
income
Total other
equity
interest		 Total other equity interest
Exchange
differences on
translation of
Unrealized
gains
(losses) from
financial assets
measured at
fair value
foreign
financial
statements
through other
comprehensive
income
Total other
equity
interest		 Total other equity interest
Exchange
differences on
translation of
Unrealized
gains
(losses) from
financial assets
measured at
fair value
foreign
financial
statements
through other
comprehensive
income
Total other
equity
interest		 Total other equity interest
Exchange
differences on
translation of
Unrealized
gains
(losses) from
financial assets
measured at
fair value
foreign
financial
statements
through other
comprehensive
income
Total other
equity
interest		 Total other equity interest
Exchange
differences on
translation of
Unrealized
gains
(losses) from
financial assets
measured at
fair value
foreign
financial
statements
through other
comprehensive
income
Total other
equity
interest		 Total
equity
10,186,815
-
-
(315,975)
(315,975)
278,360
136,967
415,327
10,286,167
9,934,363
-
-
(157,988)
(157,988)
338,441
(316,211)
22,230
9,798,605
Exchange
differences on
translation of
foreign
financial
statements
Unrealized
gains
(losses) from
financial assets
measured at
fair value
through other
comprehensive
income
Ordinary
shares		 Legal
reserve		 Special
reserve		 Unappropriated
retained
earnings		 Total
retained
earnings
53,411 1,664,166 621,623 6,151,652
(51,371)
262,136
(315,975)
(105,210)
278,360
-
278,360
6,324,802
6,366,772
(32,033)
(176,203)
(157,988)
(366,224)
338,441
-
338,441
6,338,989		 8,437,441 (263,496)
-
-
-
-
-
123,227
123,227
(140,269)
(541,143)
-
-
-
-
-
(331,480)
(331,480)
(872,623)		 (15,387)
-
-
-
-
-
13,740
13,740
(1,647)
5,453
-
-
-
-
-
15,269
15,269
20,722		 (278,883)
-
-
-
-
-
136,967
136,967
(141,916)
(535,690)
-
-
-
-
-
(316,211)
(316,211)
(851,901)
-
-
-		 51,371
-
-
- 51,371
-
-		 -
-
- -
53,411 1,715,537
53,411 1,715,537
-
-
-		 32,033
-
-
- 32,033
-
-		 -
-
- -
53,411 1,747,570

See accompanying notes to consolidated financial statements.

7

(English Translation of Consolidated Financial Statements Originally Issued in Chinese)

REVIEWED ONLY, NOT AUDITED IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the nine months ended September 30, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from (used in) operating activities:
Profit before tax
Adjustments:
Adjustments to reconcile profit (loss):
Depreciation and amortization expense
Expected credit loss
Net (gain) loss on financial assets at fair value through profit or loss
Interest expense
Interest income
Dividend income
Share of profit of associates and joint ventures accounted for using equity method
Net (gain) loss on disposal of property, plant and equipment
Other
Total adjustments to reconcile profit (loss)
Changes in operating assets:
Decrease in notes and accounts receivable (including related parties)
Increase in other current assets
Decrease (Increase) in other current financial assets
Changes in operating liabilities:
Decrease in notes and accounts payable
Increase in current contract liabilities
Decrease in other current liabilities
Decrease in net defined benefit liability
Total changes in operating assets and liabilities
Total adjustments
Cash inflow generated from operations
Interest received
Dividends received
Interest paid
Income taxes paid
Net cash flows from operating activities
Cash flows from (used in) investing activities:
Acquisition of financial assets at fair value through other comprehensive income
Acquisition of financial assets at fair value through profit or loss
Proceeds from disposal of financial assets at fair value through profit or loss
Acquisition of investments accounted for using equity method
Acquisition of property, plant and equipment
Proceeds from disposal of property, plant and equipment
Increase in other non-current assets
Decrease (Increase) in other current financial assets
Decrease in other non-current financial assets
Net cash flows used in investing activities
Cash flows from (used in) financing activities:
Increase (decrease) in short-term borrowings
Proceeds from issuing bonds
Repayments of bonds
Repayments of long-term borrowings
Payment of lease liabilities
Cash dividends paid
Other
Net cash flows used in financing activities
Effect of exchange rate changes on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period		 For the nine months ended September 30
2020
2019
$ 356,534
317,891
704,626
723,437
87
69
(247,116)
3,607
118,016
185,729
(22,687)
(59,592)
(13,616)
(6,009)
(58,144)
(52,715)
3,955
(3,242)
(316)
-
484,805
791,284
10,950
6,932
(28,711)
(24,652)
(2,777)
28,688
(20,538)
10,968
(88,779)
(3,940)
2,881
1,129
(40,449)
(27,914)
(1,585)
(17,924)
(127,932)
(48,649)
(148,470)
(37,681)
336,335
753,603
692,869
1,071,494
27,940
59,887
52,052
84,829
(138,192)
(200,293)
(37,031)
(16,835)
597,638
999,082
(71,738)
(259,377)
(278,816)
(30,761)
-
13,553
-
(30,000)
(81,078)
(151,738)
12,420
6,782
(27,086)
(9,158)
(12,115)
80,216
3,563
47
(454,850)
(380,436)
(1,278,885)
489,923
2,500,000
-
(400,000)
-
(533,798)
(885,605)
(39,478)
(41,862)
(157,988)
(315,975)
(298)
291
89,553
(753,228)
(76,368)
33,673
155,973
(100,909)
3,288,046
3,345,205
$
3,444,019
3,244,296
2020
$ 356,534
704,626
87
(247,116)
118,016
(22,687)
(13,616)
(58,144)
3,955
(316)
484,805
10,950
(28,711)
(2,777)
(20,538)
(88,779)
2,881
(40,449)
(1,585)
(127,932)
(148,470)
336,335
692,869
27,940
52,052
(138,192)
(37,031)
597,638
(71,738)
(278,816)
-
-
(81,078)
12,420
(27,086)
(12,115)
3,563
(454,850)
(1,278,885)
2,500,000
(400,000)
(533,798)
(39,478)
(157,988)
(298)
89,553
(76,368)
155,973
3,288,046
$
3,444,019

See accompanying notes to consolidated financial statements.

8

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) Reviewed only, not audited in accordance with generally accepted auditing standards CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

September 30, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars Except for Earnings Per Share Information and Unless Otherwise Specified)

(1) Company history

CHINESE MARITIME TRANSPORT LTD. (the “Company”), previously named Associated Transport Inc., was incorporated as a company limited by shares on January 31, 1978, in the Republic of China. The Company’ s common shares were listed on the Taiwan Stock Exchange (TWSE). The consolidated financial statements of the Company as of and for the nine months ended September 30, 2020 comprise the Company and its subsidiaries (together refined to as the “Group”). The main activities of the Group are bulk-carrier transportation through its 100%-owned overseas subsidiaries; domestic container hauling, vessel transportation, warehousing, and related business; and acting as the general sales agent for Saudi Arabian Airlines. The Group also owns investment companies to engage in the business of investment. Based on the organization of the Group and distribution of duties, the Company leads and invests in the business in the Group related to transportation. Please refer to note 4 (b) for related information.

(2) Approval date and procedures of the consolidated financial statements

These consolidated financial statements for the nine months ended September 30, 2020 were authorized for issue by the board of directors on November 13, 2020.

(3) New standards, amendments and interpretations adopted:

  • (a) The impact of the International Financial Reporting Standards (“IFRSs”) endorsed by the Financial Supervisory Commission, R.O.C. (“FSC”) which have already been adopted.

The following new standards, interpretations and amendments have been endorsed by the FSC and are effective for annual periods beginning on or after January 1, 2020.

Effective date
New, Revised or Amended Standards and Interpretations per IASB
Amendments to IFRS 3 “Definition of a Business” January 1, 2020
Amendments to IFRS 9, IAS39 and IFRS7 “Interest Rate Benchmark Reform” January 1, 2020
Amendments to IAS 1 and IAS 8 “Definition of Material” January 1, 2020
Amendments to IFRS 16 “Covid-19-Related Rent Concessions” June 1, 2020

Except for the following items, the Group believes that the adoption of the above IFRSs would not have any material impact on its consolidated financial statements. The extent and impact of significant changes are as follows:

(Continued)

9

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

The amendments to IAS 1 and IAS 8 “Definition of Material”clarify the definition of material and how it should be applied by including in the definition guidance that until now has featured elsewhere in IFRS Standards. In addition, the explanations accompanying the definition have been improved. Finally, the amendments ensure that the definition of material is consistent across all IFRS Standards.

There was no material impact to financial position and financial performance at the date of initial application.

  • (b) The impact of IFRS issued by the FSC but not yet effective

The following new standards, interpretations and amendments have been endorsed by the FSC and are effective for annual periods beginning on or after January 1, 2021:

Effective date
New, Revised or Amended Standards and Interpretations per IASB
Amendments to IFRS 4 “Extension of the Temporary Exemption from Applying January 1, 2021
IFRS 9”

The Group assesses that the adoption of the abovementioned amendments would not have any material impact on its consolidated financial statements.

  • (c) The impact of IFRS issued by IASB but not yet endorsed by the FSC

As of the date, the following IFRSs that have been issued by the International Accounting Standards Board (IASB), but have yet to be endorsed by the FSC:

Effective date
New, Revised or Amended Standards and Interpretations per IASB
Amendments to IFRS 10 and IAS 28 “Sale or Contribution of Assets Between Effective date to
an Investor and Its Associate or Joint Venture” be determined
by IASB
IFRS 17 “Insurance Contracts” January 1, 2023
Amendments to IAS 1 “Classification of Liabilities as Current or Non-current” January 1, 2023
Amendments to IAS 16 “Property, Plant and Equipment－Proceeds before January 1, 2022
Intended Use”
Amendments to IAS 37 “Onerous Contracts－Cost of Fulfilling a Contract” January 1, 2022
Annual Improvements to IFRS Standards 2018-2020 January 1, 2022
Amendments to IFRS 3 “Reference to the Conceptual Framework” January 1, 2022
Amendments to IFRS 17 “Insurance Contracts” January 1, 2023
Amendments to IFRS 9, IAS39, IFRS7, IFRS 4 and IFRS 16 “Interest Rate January 1, 2021
Benchmark Reform－Phase 2”

(Continued)

10

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Those which may be relevant to the Group are set out below:

Issuance / Release
Dates
January 23, 2020		 Standards or
Interpretations
Content of amendment
Amendments to IAS 1
“Classification of Liabilities as
Current or Non-current”
The amendments aim to promote consistency
in applying the requirements by helping
companies
determine
whether,
in
the
statement of balance sheet, debt and other
liabilities with an uncertain settlement date
should be classified as current (due or
potentially due to be settled within one year)
or non-current. The amendments include
clarifying the classification requirements for
debt a company might settle by converting it
into equity.

The Group is evaluating the impact of its initial adoption of the abovementioned standards or interpretations on its consolidated financial position and consolidated financial performance. The results thereof will be disclosed when the Group completes its evaluation.

(4) Summary of significant accounting policies

(a) Statement of compliance

These consolidated financial statements have been prepared in accordance with the preparation and guidelines of IAS 34 “Interim Financial Reporting” which are endorsed and issued into effect by FSC, and do not include all of the information required by the Regulations and International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations and SIC Interpretations endorsed and issued into effect by the FSC (hereinafter referred to IFRS endorsed by the FSC) for a complete set of the annual consolidated financial statements.

Except the following accounting policies mentioned below, the significant accounting policies used in the financial statements are consistent with the consolidated financial statements for the year ended December 31, 2019. For the related information, please refer to note (4) of the consolidated financial statements for the year ended December 31, 2019.

(b) Basis of consolidation

Name of
investor		 Name of subsidiary
Chinese Maritime Transport(S)
Pte. Ltd. (CMTS)
Chinese Maritime Transport
(Hong Kong), Limited
(CMTHK)		 Principal
activity		 Shareholding September
30, 2019
Note
September
30, 2020
0.34
100		 December
31, 2019
0.34
100
The Company
〃		 Investment
holding of
ship-owning
companies
Investment
holding of
ship-owning
companies		 0.34
100

(Continued)

11

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Name of
investor		 Name of subsidiary
CMT Logistics Co., Ltd.
(CMTL)
AGM Investment Ltd. (AGMI)
Hope Investment Ltd. (HIL)
Mo Hsin Investment Ltd. (MHI)
Associated Transport Inc. (ATI)
CMT Travel Service Ltd.
(CMTTSL)
United Nan Hai Petroleum INC
(UNH)
United Nan Hai Development
Inc. (NHD)
CMT Leasing Co., Ltd.
(CMTLL)
China Fortune Shipping Pte Ltd.
(CFR)
China Enterprise Shipping PTE.
Ltd. (CEP)
China Prosperity Shipping Ltd.
(CPS)
China Peace Shipping Ltd.
(CPC)
China Progress Shipping Ltd.
(CPG)
China Pioneer Shipping Ltd.
(CPN)
China Pride Shipping Ltd. (CPD)
CMT Chartering Ltd. (CCL)
China Triumph Shipping Ltd.
(CTU)
China Trade Shipping Ltd.
(CTD)
China Harmory Shipping Ltd.
(CHM)
China Honour shipping Ltd.
(CHN)
CMT Investment CO., Limited
(CHI)
Chinese Maritime Transport Ship
Management (Hong Kong)
Limited (CIM)
Chinese Maritime Transport (S)
Ptd. Ltd. (CMTS)		 Principal
activity		 Shareholding September
30, 2019
Note
September
30, 2020
100
100
100
100
100
100
100
100
-
100
100
100
100
100
100
100
100
100
100
100
100
100
100
99.66		 December
31, 2019
100
100
100
100
100
100
100
100
-
100
100
100
100
100
100
100
100
100
100
100
100
100
100
99.66
The Company
〃
〃
〃
〃
〃
〃
〃
〃
CMTS
〃
CMTHK
〃
〃
〃
〃
〃
〃
〃
〃
〃
CMTHK
〃
〃		 Warehouse
management
Investment
Investment
Investment
Container
trucking
Travel
Gasoline
international trade
Investment
Car rental
Bulk-carrier
transportation
Bulk-carrier
transportation
Bulk-carrier
transportation
Bulk-carrier
transportation
Bulk-carrier
transportation
Bulk-carrier
transportation
Bulk-carrier
transportation
Bulk-chartering
services
Bulk-carrier
transportation
Bulk-carrier
transportation
Bulk-carrier
transportation
Bulk-carrier
transportation
Investment
Investment
management
Investment
holding of ship-
owning
companies		 100
Note 2
100
100
100
100
100
Note 2
100
Note 2
100
Note 2
-
Note 1,
Note 2
100
100
100
100
100
100
100
100
100
100
100
100
100
100
99.66

(Continued)

12

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Name of
investor		 Name of subsidiary
Chang-Shun Transport CO., Ltd.
(CST)
Huang-Yuen Transport CO., Ltd.
(HYT)
Mao-Hua Transport CO., Ltd.
(MHT)
AG Prosperity Transport CO.,
Ltd. (APT)
Pioneer Transport Co., Ltd.
(PTL)		 Principal
activity		 Shareholding September
30, 2019
Note
September
30, 2020
100
100
100
100
100		 December
31, 2019
100
100
100
100
100
ATI
〃
〃
〃
〃		 Container
trucking
Container
trucking
Container
trucking
Container
trucking
Container
trucking		 100
100
100
100
100

Note 1: Subsidiary incorporated in August 2018; and was dissolved in January 2019. Note 2: Non-significant subsidiary, its financial statements have not been reviewed.

(c) Employee benefits

The pension cost for an interim period was calculated and disclosed on a year-to-date basis by using the actuarially determined pension cost rate at the end of the prior fiscal year.

(d) Income taxes

The income tax expenses have been prepared and disclosed in accordance with paragraph B12 of International Financial Reporting Standards 34, Interim Reporting.

Income tax expenses for the period are best estimated by multiplying pre-tax income for the interim reporting period by the effective annual tax rate as forecasted by the management. This should be recognized fully as tax expense for the current period.

Temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and their respective tax bases shall be measured based on the effective tax rate at the time of realization or liquidation and recognized directly in equity or other comprehensive income as tax expense.

(5) Significant accounting assumptions and judgments, and major sources of estimation uncertainty

The preparation of the consolidated financial statements in conformity with IFRSs (in accordance with IAS 34 endorsed by the FSC) requires management to make judgments, estimates and assumptions that affect the application of the accounting policies and the reported amount of assets, liabilities, income and expenses. Actual results may differ from these estimates.

(Continued)

13

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

In the preparation of this consolidated interim financial statements, the major sources of accounting assumptions, judgments and estimation uncertainty are consistent with Note (5) of the annual consolidated financial statements for the year ended December 31, 2019.

(6) Explanation of significant accounts

Except for the following disclosures, there is no significant difference as compared with those disclosed in the consolidated financial statements for the year ended December 31, 2019. Please refer to Note (6) of the consolidated financial statements for the year ended December 31, 2019.

  • (a) Cash and cash equivalents
September 30,
2020
Petty cash, checking accounts and demand
deposits
$ 706,890
Time deposits
2,298,210
Cash equivalents-commercial paper and
reverse repurchase agreement
438,919
$
3,444,019
(b)
Financial assets at fair value through profit or loss
(i)
Information is as follows:
September 30,
2020
Current financial assets mandatorily
measured as at fair value through
profit or loss:
Non-derivative financial instrument
$ Domestic listed stocks
528,811
Non-current financial assets
mandatorily measured as at fair
value through profit or loss:
Non-derivative financial instrument
Domestic listed stocks
65,448
Domestic listed stocks under private
placement
39,731
Domestic unlisted stocks
25,545
$
659,535		 December 31,
2019
863,945
2,254,565
169,536
3,288,046
December 31,
2019
14,050
62,963
31,046
25,545
133,604		 September 30,
2019
716,307
2,337,702
190,287
3,244,296
September 30,
2019
58,012
-
32,630
25,788
116,430

(Continued)

14

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Current
Non-current		 September 30,
2020
$ 528,811
130,724
$
659,535		 December 31,
2019
14,050
119,554
133,604		 September 30,
2019
58,012
58,418
116,430

The gain or loss on financial assets at fair value through profit or loss for the three months ended and nine months ended September 30, 2020 and 2019 were gain of $179,586gain of $5,221gain of $247,116 and loss of $3,607, respectively.

During the nine months ended September 30, 2020 and 2019, the dividends of $9,708 and $336, respectively, related to investment at fair value through profit or loss, were recognized.

The Group did not provide any aforementioned financial assets as collateral as of September 30, 2020, December 31 and September 30, 2019, respectively.

  • (ii) Debt investment information

The convertible bonds held by the Group was due on June 27, 2019, and converted to 4,798 thousand shares of common shares under private placement at $20.84 per share. The equity investments were held for trading, therefore, they were classified as non-current financial assets at fair value through profit or loss on September 30, 2020, December 31 and September 30, 2019.

  • (iii) The Group has assessed that the domestic unlisted stocks are held within a business model whose objective is achieved by both collecting the contractual cash flows and by selling securities; therefore, they have been designated as debt investment and classified as financial assets mandatorily measured value through profit or loss.

  • (c) Financial assets at fair value through other comprehensive income

September 30,
2020
Equity investments at fair value through other
comprehensive income
Domestic listed stocks
$
397,375		 December 31,
2019
315,134		 September 30,
2019
297,479
  • (i) Equity investments at fair value through other comprehensive income

The Group designated the investments shown above as equity securities at fair value through other comprehensive income because these equity securities represent those investments that the Group intends to hold for long-term strategic purposes, rather than trading purposes.

The Group newly purchased those investments for strategic purposes amounting to $71,738 and $259,377 for the nine months ended September 30, 2020 and 2019, respectively.

(Continued)

15

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

During the three months and nine months ended September 30, 2020 and 2019, the Group had recognized unrealized gain or loss on financial assets at fair value through other comprehensive income of gain $14,617 gain $12,318 gain $10,503 and gain $13,129, respectively.

During the nine months ended September 30, 2020 and 2019, the dividends of $3,908 and $5,673, respectively, related to equity investment at fair value through other comprehensive income held on September 30, 2020 and 2019, were recognized.

There were no disposal of strategic investments and transfers of any cumulative gain or loss within equity relating to these investments during the nine months ended September 30, 2020 and 2019.

  • (ii) Please refer to note (6)(t) for market risk.

  • (iii) As of September 30, 2020, December 31 and September 30, 2019, the financial assets measured at other comprehensive income of the Group had been pledge as collateral, please refer to note (8).

  • (d) Notes and accounts receivable

September 30,
2020
Notes receivable
$ 13,542
Accounts receivable
266,072
Less: Loss allowance
(245)
$
279,369
Notes and accounts receivable, net
$
268,231
Notes and accounts receivable due from
related parties, net
$
11,138		 December 31,
2019
8,952
281,612
(158)
290,406
273,636
16,770		 September 30,
2019
14,003
282,096
(207)
295,892
281,203
14,689

The Group applies the simplified approach to provide for its expected credit losses, i.e. the use of lifetime expected loss provision for all receivables. To measure the expected credit losses, trade receivables have been grouped based on shared credit risk characteristics and the days past due, as well as incorporated forward looking information, including macroeconomic and relevant industry information. The loss allowance provision was determined as follows:

(Continued)

16

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Current
1 to 30 days past due
30 to 180 days past due
More than 180 days past due
Current
1 to 30 days past due
30 to 180 days past due
More than 180 days past due
Current
1 to 30 days past due
30 to 180 days past due
More than 180 days past due		 September 30, 2020 September 30, 2020
Gross carrying
amount
Weighted-
average
loss rate
$ 268,772
-
8,006
-
2,836
8.6%
-
-
$
279,614
December 31, 2019		 Loss allowance
provision
-
-
245
-
245
Loss allowance
provision
-
-
157
1
158
Weighted-
average
loss rate
-
-
15.51%
100%		 Loss allowance
provision
-
-
206
1
207

The movement in the allowance for notes and accounts receivable was as follows:

Balance on January 1
Impairment losses recognized
Amount written off
Balance on September 30		 For the nine months ended
September 30,		 For the nine months ended
September 30,
2020
$ 158
87
-
$
245		 2019
301
69
(163)
207

(Continued)

17

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

The Group did not provide any aforementioned notes and accounts receivable as collaterals as of September 30, 2020, December 31 and September 30, 2019.

Please refer to note (6)(t) for credit risk of other receivables.

  • (e) Investments accounted for using equity method

  • (i) A summary of the Group’ s financial information for equity-accounted investees at the reporting date is as follows:

reporting date is as follows:
September 30,
2020
Associates
$
1,679,603		 December 31,
2019
1,698,801		 September 30,
2019
1,738,978
  • (ii) The Group’s share of the profit (loss) of associates and joint ventures was as follows:
Associates For the three months ended
September 30,
2020
2019
$
14,010
20,409		 For the nine months ended
September 30,		 For the nine months ended
September 30,
2020
$
14,010		 2020
58,144		 2019
52,715
  • (iii) Details of the material associate are as follows:
Name Nature of the relationship Principal place of
business/
Country of
incorporation		 Effective ownership interest and
voting right
September
30, 2020		 December 31,
2019
September
30, 2019
%
10.406
%
10.406
Taiwan
Navigation
Co., Ltd.
(TNCL)		 Entity in which the Group has
significant influence and in
which its main activities are
sea shipping services and
construction subcontractor,
leasing and sales of
commercial and residential
buildings		 Taiwan %
10.406

The fair value of the shares of the listed material associate of the Group was as follows:

September 30,
2020
TNCL
$ 733,833		 December 31,
2019
September 30,
2019
770,742
829,362

The following table summarizes the information of the Group’s material associate adjusted for any differences in accounting policies and reconciles the information to the carrying amount of the Group’s interest in the associates.

(Continued)

18

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

  • 1) Summarized financial information of TNCL
September 30,
2020
Current assets
$ 1,875,082
Non-current assets
14,450,631
Current liabilities
(1,327,722)
Non-current liabilities
(4,945,318)
Net assets (Attributable to the
investee)
$
10,052,673		 December 31,
2019
1,592,523
13,521,227
(505,748)
(4,366,773)
10,241,229		 September 30,
2019
1,375,947
13,905,515
(586,061)
(4,277,193)
10,418,208
For the three months ended For the three months ended For the three months ended For the nine months ended For the nine months ended
September 30, September 30,
2020 2019 2020 2019
Revenue $ 650,545 819,360 1,860,097 2,364,069
Profit from continuing
operations 72,096 179,289 345,667 445,678
Other comprehensive
income (42,809) 12,023 (200,387) 95,021
Total comprehensive
income (Belongs to
the investee) $ 29,287 191,312 145,280 540,699
For the nine months ended
September 30,
2020 2019
Beginning balance of Group’s share of net assets $ 1,065,702 1,084,304
Group’s share of total comprehensive income 15,117 56,266
Dividends received by associates (34,737) (56,451)
Ending balance of Group’s share of net assets $ 1,046,082 1,084,119

(iv) Summarized financial information of individually insignificant associates

The summarized financial information of individually insignificant associates using the equityaccounted method is as follows:

September 30,
2020
Carrying amount of individually
insignificant associates’ equity
$
633,521		 December 31,
2019
633,099		 September 30,
2019
654,859

(Continued)

19

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Attributable to the Group:
Profit from continuing
operations
Other comprehensive
(loss) income
Comprehensive income		 For the three months ended
September 30,
2020
2019
$ 6,507
1,754
(10,904)
339
$
(4,397)
2,093		 For the nine months ended
September 30,		 For the nine months ended
September 30,
2020
22,174
(18,054)
4,120		 2019
6,340
6,859
13,199

(v) Pledges

As of September 30, 2020, December 31 and September 30, 2019, the Group provided investment accounted for using equity method as collateral. Please refer to note (8).

(f) Property, plant and equipment

The cost depreciation, and impairment of the property, plant and equipment of the Group for the nine months ended September 30, 2020 and 2019 were as follows:

Land
Cost or deemed cost:
Balance on January 1, 2020
$ 1,717,868
Additions
-
Disposals
-
Reclassifications
-
Effect of movements in exchange
rates
-
Balance on September 30, 2020 $
1,717,868
Balance on January 1, 2019
$ 1,717,114
Additions
754
Disposals
-
Reclassifications
-
Effect of movements in exchange
rates
-
Balance on September 30, 2019 $
1,717,868
Depreciation and impairments
loss:
Balance on January 1, 2020
$ -
Depreciation
-
Disposals
-
Effect of movements in
exchange rates
-
Balance on September 30, 2020 $
-
Balance on January 1, 2019
$ -
Depreciation
-
Disposals
-
Effect of movements in
exchange rates
-
Balance on September 30, 2019 $
-		 Buildings
and
construction
146,964
848
(780)
281
(1,009)
146,304
135,685
6,716
(2,306)
-
373
140,468
83,760
6,932
(600)
(210)
89,882
85,051
5,146
(2,306)
65
87,956		 Transportation
Equipment
18,762,193
53,057
(24,492)
4,213
(527,760)
18,267,211
19,027,923
101,263
(14,085)
23,856
192,588
19,331,545
7,303,655
628,230
(16,526)
(211,983)
7,703,376
6,629,165
646,845
(11,414)
64,515
7,329,111		 Other
equipment		 Under
construction
28,220
-
-
-
(828)
27,392
11,795
34,665
-
(23,856)
117
22,721
-
-
-
-
-
-
-
-
-
-		 Total
21,266,478
81,078
(69,721)
9,266
(529,597)
20,757,504
21,451,162
151,738
(24,721)
23,258
193,078
21,794,515
7,717,067
664,469
(53,346)
(212,193)
8,115,997
7,011,416
679,844
(21,181)
64,580
7,734,659

(Continued)

20

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Carrying amounts:
Balance on January 1, 2020
Balance on September 30, 2020
Balance on September 30, 2019		 Land
$
1,717,868
$
1,717,868
$
1,717,868		 Buildings
and
construction
63,204
56,422
52,512		 Transportation
Equipment
11,458,538		 Other
equipment		 Under
construction
28,220
27,392
22,721		 Total
281,581 13,549,411
10,563,835 275,990 12,641,507
12,002,434 264,321 14,059,856

  • (i) The pledge information is summarized in note (8).

  • (ii) The Group disposed of the property, plant and equipment during the nine months ended September 30, 2020 and 2019 for $12,420 and $6,782, respectively. The cost of aforementioned property, plant and equipment amounted to $16,375 and $3,540, respectively, and the related gain or loss of disposal was loss of $3,955 and gain of $3,242, respectively. The registration procedures of the assets transfer have been completed and related receivable have been collected.

  • (iii) The Group evaluated its transportation equipment for impairment and recognized no impairment loss according to IFRS 36 “Recoverable Amount Disclosures for Non-Financial Asset”. The accumulated impairment amount was USD$31,555 thousand ($918,252, $946,019 and $979,467 in thousand New Taiwan dollars) as of September 30, 2020, December 31 and September 30, 2019, respectively.

(iv) Operating lease

The transportation equipment, bulk carriers that owned by the Group are leased to third parties under operating leases. The leases of bulk carriers contain an initial non-cancellable lease term of 1 to 3 years. For all bulk carriers leases, the rental income is fixed under the contract. For more information of operating leases, please refer to note (6)(l).

(g) Right-of-use assets

The Group leases many assets including land and buildings. Information about leases for which the Group as a lessee is presented below:

Cost:
Balance on January 1, 2020
Additions
Disposal
Balance on September 30, 2020
Balance on January 1, 2019
Additions / Disposal
Balance on September 30, 2019		 Land
$ 194,468
4,371
(41,382)
$
157,457
$ 194,468
-
$
194,468		 Buildings and
construction
78,813
-
-
78,813
78,813
-
78,813		 Total
273,281
4,371
(41,382)
236,270
273,281
-
273,281

(Continued)

21

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Accumulated depreciation and
impairment losses:
Balance on January 1, 2020
Depreciation
Disposal
Balance on September 30, 2020
Balance on January 1, 2019
Depreciation
Balance on September 30, 2019
Carrying Amount:
Balance on January 1, 2020
Balance on September 30, 2020
Balance on September 30, 2019		 Land
$ 39,345
26,028
(18,341)
$
47,032
$ -
29,509
$
29,509
$
155,123
$
110,425
$
164,959		 Buildings and
construction
15,153
11,364
-
26,517
-
11,365
11,365
63,660
52,296
67,448		 Total
54,498
37,392
(18,341)
73,549
-
40,874
40,874
218,783
162,721
232,407

(h) Investments property

Investment property comprises office buildings that are leased to third parties under operating leases that are owned by the Group. The leases of investment properties contain an initial non-cancellable lease term of 1 to 5 years. For all investment property leases, the rental income is fixed under the contracts.

Owned Property
Land
Building
Cost or deemed cost:
Balance on January 1, 2020
$ 19,094
25,152
Effect of movements in exchange rates
-
(629)
Balance on September 30, 2020
$
19,094
24,523
Balance on January 1, 2019
$ 19,094
25,676
Effect of movements in exchange rates
-
232
Balance on September 30, 2019
$
19,094
25,908
Depreciation and impairment losses:
Balance on January 1, 2020
$ -
8,251
Depreciation
-
368
Effect of movements in exchange rates
-
(171)
Balance on September 30, 2020
$
-
8,448
Balance on January 1, 2019
$ -
7,881
Depreciation
-
383
Effect of movements for exchange rates
-
55
Balance on September 30, 2019
$
-
8,319		 Total
44,246
(629)
43,617
44,770
232
45,002
8,251
368
(171)
8,448
7,881
383
55
8,319

(Continued)

22

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Owned Property
Land
Building
Carrying amount:
Balance on January 1, 2020
$
19,094
16,901
Balance on September 30, 2020
$
19,094
16,075
Balance on September 30, 2019
$
19,094
17,589		 Total
35,995
35,169
36,683

The fair value of investment properties was based on a valuation by a qualified independent appraiser who has recent valuation experience in the location and category of the investment property being valued.

There was no significant change in the fair value of investment property during the nine months ended September 30, 2020 as disclosed in note 6(h) of the consolidated financial statements for the year ended December 31, 2019.

As of September 30, 2020, December 31 and September 30, 2019, the investment property of the Group was not pledged as collateral or restricted.

  • (i) Other financial assets
September 30,
2020
Restricted deposit
$ 76,988
Time deposits (over three months)
31,888
Other receivables
11,869
Guarantee deposits
6,475
Pledged assets-time deposits
201,160
$
328,380
Other current financial assets
$ 310,153
Other non-current financial assets
18,227
$
328,380		 December 31,
2019
-
58,234
17,860
5,696
244,029
325,819
304,029
21,790
325,819		 September 30,
2019
-
22,168
12,829
5,790
195,056
235,843
213,960
21,883
235,843

The restricted deposits are applicable to “The Management, Utilization, and Taxation of Repatriated Offshore Funds Act” for the Group in 2020. The restricted deposit accounts are used for the purpose of offshore funds.

As of September 30, 2020, December 31 and September 30, 2019, the Group provided other financial assets as collateral. Please refer to note (8).

(Continued)

23

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(j) Loans

The Group’s details of loans were as follows:

  • (i) Short-term loans and commercial paper payable, net
September 30,
2020
Bank loans
$ 176,000
Commercial paper payable
75,000
Less: discount on commercial paper
payable
(2)
$
250,998
Unused credit lines
$
3,769,000
Range of interest rate
0.88%~1.038%
 December 31,
2019
1,050,000
480,000
(117)
1,529,883
2,390,000
0.900%~1.198%		 September 30,
2019
900,000
530,000
(324)
1,429,676
2,490,000
0.900%~1.198%

(ii) Long-term loans

Bank Currency Due
Year
September
30, 2020
2021 $ 196,425
2022
535,045
2022
196,425
2023
626,323
2026
470,787
2027
690,617
2027
691,125
3,406,747
(634,337)
$
2,772,410
1.00%~3.52%		 December
31, 2019
269,820
650,163
337,275
694,359
535,590
782,148
777,381
4,046,736
(653,519)
3,393,217
2.65%~4.31%		 September
30, 2019
349,200
673,151
349,200
769,743
554,527
809,801
804,867
4,310,489
(676,626)
3,633,863
2.93%~4.31%

(Continued)

24

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(iii) Bonds Payable

The Company issued secured bonds at face value. The interest is calculated and paid annually from the date of issuance. The bonds payables were as follows:

2016
The first secured bonds
payable
The second secured bonds
payable
2017
The first secured bonds
payable
″
2020
The first secured bonds
payable
″
″
″
Current portion		 Guarantee
bank		 Interest
rate		 Due
September 30,
2020
March 2021 $ 900,000
March 2021
1,400,000
April 2020
-
April 2022
400,000
August 2025
500,000
August 2025
500,000
August 2025
1,000,000
August 2025
500,000
5,200,000
(2,300,000)
$
2,900,000		 December 31,
2019
900,000
1,400,000
400,000
400,000
-
-
-
-
3,100,000
(400,000)
2,700,000		 September 30,
2019
900,000
1,400,000
400,000
400,000
-
-
-
-
3,100,000
(400,000)
2,700,000
Bank of
Taiwan
Mega Bank
Shanghai
Commercial
Bank
″
Shanghai
Commercial
Bank
″
Mega Bank
″		 %
0.88
%
1.00
%
1.13
%
1.13
%
0.64
%
0.66
%
0.64
%
0.66

  • (iv) In order to repay its bank loans and bonds payable which were issued previously, as well as to increase its working capital for the requirement of business development, the Company issued secured corporate bonds, which were approved at the Board of Directors' meetings on May 13, 2020. The first secured corporate bonds were released with a period of five years, which amounted to $1,000, at par value, with a total amount of $2,500,000. The bonds were issued at full.

  • (v) Refer to note 6(t) for the information of exposure to liquidity risk. The Group provided assets as collaterals for credit line of short-term and long-term borrowing, please refer to note (8).

(Continued)

25

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(k) Lease liabilities

September 30,
2020
Current
$
42,295
Non-current
$
121,444		 December 31,
2019
52,509
169,693		 September 30,
2019
52,309
179,110

For the maturity analysis, please refer to note 6(t) financial instruments.

The amounts recognized in profit or loss were as follows:

The amounts recognized in profit or loss were as follows:
Interest on lease liabilities For the three months ended
September 30,
2020
2019
$
447
633		 For the nine months ended
September 30,
2020
$
447		 2020
1,469		 2019
1,973

The amounts recognized in the consolidated statements of cash flows for the Group were as follows:

Total cash outflow for leases
Land and building leases		 For the nine months ended
September 30,		 For the nine months ended
September 30,
2020
$
40,947		 2019
43,835

As of September 30, 2020, the Group leases land and building for its parking space and warehouses. The leases of land typically run for period of 2 to 8 years, and of warehouses for 4 to 6 years.

(l) Operating lease

The Group leases out its investment property and some machines. The Group has classified these leases as operating leases, because it does not transfer substantially all of the risks and rewards incidental to the ownership of the assets. Please refer to note 6(h) sets out information about the operating leases of investment property.

The Group leases the bulk carriers in fixed amount. In the end of the lease term, lessee does not have the bargain purchase option. Therefore, the leases of bulk carriers are classified as operating lease. Please refer to note 6(f).

A maturity analysis of lease payments, showing the undiscounted lease payments to be received after the reporting date is as follows:

September 30,
2020
Less than one year
$ 374,012
Between one and five years
4,315
Total undiscounted lease payments
$
378,327		 December 31,
2019
251,707
1,794
253,501		 September 30,
2019
491,919
2,235
494,154

(Continued)

26

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(m) Employee benefits

(i) Defined benefit plans

Given there was no significant volatility of the market or any significant reimbursement, settlement or other one-time event in the prior fiscal year, pension cost in the interim financial statements is measured and disclosed in accordance with the actuarial report measured on December 31, 2019 and 2018.

The pension costs of the defined benefit plans were as follows:

Cost of sales and operating
expense		 For the three months ended
September 30,
2020
2019
$
674
862		 For the nine months ended
September 30,		 For the nine months ended
September 30,
2020
$
674		 2020
2,022		 2019
2,586

(ii) Defined contribution plans

The pension costs under the defined contribution plans were as follows, and the payment was made to the Bureau of Labor Insurance:

Cost of sales and operating
expense		 For the three months ended
September 30,
2020
2019
$
2,756
2,565		 For the nine months ended
September 30,		 For the nine months ended
September 30,
2020
$
2,756		 2020
8,119		 2019
7,393

The pension expenses recognized by other subsidiaries included in consolidated financial statements for the three months ended and nine months ended September 30, 2020 and 2019 were $319$335$993 and $959, respectively.

(n) Income taxes

(i) Tax expenses

The components of income tax for the three months ended and nine months ended September 30, 2020 and 2019 were as follows:

Current tax expense
Deferred tax expense
Recognition and reversal of
temporary differences
Tax expense		 For the three months ended
September 30,
2020
2019
$ 4,936
10,049
-
(1,332)
$
4,936
8,717		 For the nine months ended
September 30,		 For the nine months ended
September 30,
2020
$ 4,936
-
$
4,936		 2020
18,093
-
18,093		 2019
32,009
7,522
39,531

(Continued)

27

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(ii) Assessment of tax

The tax returns of the Company and the domestic entities for the years through 2018 were assessed by the tax administration.

(o) Capital and other equities

There was no significant change for capital and other equity for the periods from for the nine months ended September 30, 2020 and 2019. For the related information, please refer to note 6(o) of the consolidated financial statements for the year ended December 31, 2019.

(i) Retained Earning

In accordance with the Company’s articles of incorporation, net earnings should first be used to offset the prior years’ deficits, if any, before paying any in income taxes, of the remaining balance, 10% is to be appropriated as legal reserve, and when there is a reduction in stockholders’ equity at the end of the year, the Company should appropriate the same amount as special reserve from retained earnings. The remainder and the accumulated unappropriated earnings of prior years are distributable as dividends to stockholders. The distribution rate is based on the proposal of the Company’ s board of directors and should be approved in the stockholders’ meeting.

Dividends are paid in cash or stock from retained earnings, and the amount of cash dividends should not be less than 10% of total dividends.

1) Legal reserve

When the Company has no accumulated deficits on the books, the legal reserve can be converted to share capital or distributed as cash dividends, and only the portion of legal reserve that exceeds 25% of issued share capital may be distributed.

2) Special reserve

By choosing to apply the exemptions granted under IFRS 1 "First-time Adoption of International Financial Reporting Standards" during the Company’s first-time adoption of the International Financial Reporting Standards approved by the Financial Supervisory Commission (IFRSs), unrealized revaluation gains recognized under shareholders’ equity. The increase in retained earnings occurring before the adoption date, due to the first-time adoption of IFRSs in accordance with Rule No. 1010012865 issued by the Financial Supervisory Commission on 6 April 2012, shall be reclassified as a special earnings reserve during earnings distribution. The carrying amount of special earnings reserve amounted to $535,690 on September 30, 2020, $359,487 on December 31 and $359,487 on September 30, 2019, respectively.

(Continued)

28

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

In accordance with the guidelines of the above Rule, a portion of current-period earnings and undistributed prior-period earnings shall be reclassified as a special earnings reserve during earnings distribution. The amount to be reclassified should be equal to the difference between the total net current-period reduction of other shareholders’ equity resulting from the first-time adoption of IFRSs and the carrying amount of special earnings reserve as stated above. Similarly, a portion of undistributed prior period earnings shall be reclassified as a special earnings reserve (which does not qualify for earnings distribution) to account for cumulative changes to other shareholders’ equity pertaining to prior periods due to the first-time adoption of IFRSs. Amounts of subsequent reversals pertaining to the net reduction of other shareholders’ equity shall qualify for additional distributions.

3) Earnings distribution

Based on the resolutions of the annual stockholders’ meeting held on May 13, 2020 and June 18, 2019, the earning distributions to ordinary shareholders for the fiscal years 2019 and 2018 were as follows:

2019 2018
Dividends distributed to ordinary shareholders
Cash $ 157,988 315,975
Other Equity (After tax)
Unrealized gains
(losses) from
financial assets
Exchange measured at fair
differences on value through
translation of other
foreign financial comprehensive
Statements income Total
January 1, 2020 $ (541,143) 5,453 (535,690)
The Company and its subsidiaries (287,808) 10,503 (277,305)
Associates (43,672) 4,766 (38,906)
September 30, 2020 $ (872,623) 20,722 (851,901)
January 1, 2019 $ (263,496) (15,387) (278,883)
The Company and its subsidiaries 107,089 13,129 120,218
Associates 16,138 611 16,749
September 30, 2019 $ (140,269) (1,647) (141,916)

(ii) Other Equity (After tax)

(Continued)

29

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

  • (p) Earnings per share

  • (i) Basic earnings per share

The calculation of basic earnings per share at September 30, 2020 and 2019 were based on the profit attributable to ordinary shareholders of the Company and the weighted-average number of ordinary shares outstanding, calculated as follows:

  • 1) Profit attributable to ordinary shareholders of the Company
Profit attributable to
ordinary shareholders
of the Company
 For the three months ended
September 30,
2020
2019
$
203,356
88,448		 For the nine months ended
September 30,		 For the nine months ended
September 30,
2020
$
203,356		 2020
338,441		 2019
278,360
  • 2) Weighted-average number of ordinary shares (thousands)
Weighted-average
number of ordinary
shares (basic)		 For the three months ended
September 30,
2020
2019
197,485
197,485		 For the nine months ended
September 30,		 For the nine months ended
September 30,
2020
197,485		 2020
197,485		 2019
197,485
  • 3) Basic earnings per share (NTD)
For the three months ended
September 30,
2020
2019
Basic earnings per share$
1.03
0.45		 For the nine months ended
September 30,		 For the nine months ended
September 30,
2020
1.71		 2019
1.41
  • (ii) Diluted earnings per share

The calculation of diluted earnings per share at September 30, 2020 and 2019 were based on profit attributable to ordinary shareholders of the Company and the weighted-average number of ordinary shares outstanding after adjustment for the effects of all dilutive potential ordinary shares, calculated as follows:

  • 1) Profit attributable to ordinary shareholders of the Company (diluted)
Profit attributable to
ordinary shareholder
of the Company		 For the three months ended
September 30,
2020
2019
$
203,356
88,448		 For the nine months ended
September 30,		 For the nine months ended
September 30,
2020
$
203,356		 2020
338,441		 2019
278,360

(Continued)

30

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

  • 2) Weighted-average number of ordinary shares (diluted) (thousands)
For the three months ended
September 30,
2020
2019
Number of ordinary
shares (basic), Jan 1
197,485
197,485
Effect on the employee
stock bonuses
138
96
Weighted-average
number of ordinary
shares (diluted),
September 30
197,623
197,581
Diluted earnings per share (NTD)
For the three months ended
September 30,
2020
2019
Diluted earnings per
share
$
1.03
0.45		 For the nine months ended
September 30,		 For the nine months ended
September 30,
2020
2019
197,485
197,485
193
156
197,678
197,641
For the nine months ended
September 30,		 2019
197,485
156
197,641
2020
1.71		 2019
1.41 
  - 3) Diluted earnings per share (NTD)

  • (q) Revenue from contracts with customers

  • (i) Disaggregation of revenue

Primary geographical markets
Asia
Europe
Oceania		 For the three months ended September 30, 2020 For the three months ended September 30, 2020 For the three months ended September 30, 2020 For the three months ended September 30, 2020
Inland trucking
and terminal &
logistics
department		 Shipping
department
-
278,571
121,211
399,782		 Others
8,470
-
-
8,470		 Total
$ 377,573
-
-
$
377,573		 386,043
278,571
121,211
785,825

(Continued)

31

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Primary geographical markets
Asia
Europe
Oceania		 For the three months ended September 30, 2019 For the three months ended September 30, 2019 For the three months ended September 30, 2019 For the three months ended September 30, 2019
Inland trucking
and terminal &
logistics
department		 Shipping
department
-
333,228
130,371
463,599		 Others
5,250
-
-
5,250		 Total
$ 458,268
-
-
$
458,268		 463,518
333,228
130,371
927,117
Primary geographical markets
Asia
Europe
Oceania
Primary geographical markets
Asia
Europe
Oceania		 For the nine months ended September 30, 2020 For the nine months ended September 30, 2020 For the nine months ended September 30, 2020 For the nine months ended September 30, 2020
Inland trucking
and terminal &
logistics
department		 Total
1,124,166
849,768
364,441
2,338,375
Inland trucking
and terminal &
logistics
department
$ 1,369,619
-
-
$
1,369,619		 Shipping
department
-
1,012,510
436,883
1,449,393		 Others
21,728
-
-
21,728		 Total
1,391,347
1,012,510
436,883
2,840,740

(ii) Contract balances

September 30,
2020
Notes and accounts receivable
(including related parties)
$ 279,614
Less: allowance for impairment
(245)
Total
$
279,369
Contract liabilities
$
22,208		 December 31,
2019
290,564
(158)
290,406
19,327		 September 30,
2019
296,099
(207)
295,892
20,601

(Continued)

32

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

For details on notes and accounts receivable and allowance for impairment, please refer to note (6)(d).

The amounts of revenue recognized for the three months ended and nine months ended September 30, 2020 and 2019 that were included in the contract liability balance at the beginning of the period were $19,327 and $19,472, respectively.

The major change in the balance of contract assets and contract liabilities is the difference between the time frame in the performance obligation to be satisfied and the payment to be received.

(r) Financial cost-Interest expense

The financial cost interest expenses were as follows:

Bank loan
Bonds payable
Lease liabilities		 For the three months ended
September 30,
2020
2019
$ 17,309
43,835
14,686
13,446
447
633
$
32,442
57,914		 For the nine months ended
September 30,		 For the nine months ended
September 30,
2020
$ 17,309
14,686
447
$
32,442		 2020
76,623
39,924
1,469
118,016		 2019
143,418
40,338
1,973
185,729

(s) Employee compensation and directors’ and supervisors’ remuneration

In accordance with the Company’s articles of incorporation, earnings shall first be used to offset against any deficit, then a range from 0.5% to 2% will be distributed to its employee compensation, and a maximum of 2% will be allocated to its director’s and supervisors’ remuneration.

For the three-month periods and nine-month periods ended September 30, 2020 and 2019, the Company recognized its employee compensation of $2,075$936$3,496 and $3,083, respectively, and its directors’ and supervisors’ remuneration of $2,075$936$3,496 and $3,083, respectively. The employee compensation and directors’ and supervisors’ remuneration were recorded as operation expenses and were estimated based on the net profit before tax, excluding the employee compensation, and director’ s and supervisors’ remuneration of each period, multiplied by the percentage of remuneration to employees, directors and supervisors as specified in the Company's articles. If there is difference between the aforementioned distribution approved in the board of directors and the estimation, it will be deal with changes in accounting estimation, and will be recognized in profit or loss next year.

For the years ended December 31, 2019 and 2018, the Company recognized its employee compensation of $3,653 and $5,509, respectively, and its directors’and supervisors’remuneration of $3,653 and $5,509, respectively. There was no difference between the aforementioned distribution approved in the board of directors and the estimation in the 2019 and 2018 consolidated financial statements. Relative information is available on the MOPS.

(Continued)

33

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

  • (t) Financial Instruments

  • (i) Credit risk

    • 1) Exposure to credit risk

The carrying amount of financial assets represents the maximum amount exposed to credit risk. As of September 30, 2020 and 2019, the maximum amount exposed to credit risk amounted to $5,108,678 and $4,189,940, respectively.

The aggregation of sales to the Group’s major customers exceeding 10% of the Group’s total sales accounted for 51% and 45% of the total net sales for the nine months ended September 30, 2020 and 2019, respectively. In order to reduce credit risk, the Group assesses the financial status of the customers and the possibility of collection of receivables in order to estimate an adequate allowance for doubtful accounts on a regular basis. The customers have had a good credit and profit record. The Group has never suffered any significant credit loss.

  • 2) Credit risk of Receivables

For credit risk exposure of notes and accounts receivable, please refer to note (6)(d).

Other financial assets at amortized cost includes other receivables, guarantee deposits, pledged assets-time deposits, time deposits (over three months) and restricted deposit.

All of these financial assets are considered to have low risk, and thus, the impairment provision recognized during the period was limited to 12 months expected losses, with the measurement proving to have no impairment loss.

  • (ii) Liquidity Risk

The following are the contractual maturities of financial liabilities, including estimated interest payments and excluding the impact of netting agreements:

September 30, 2020
Non-derivative financial liabilities:
Short-term borrowings
Secured bank loans
Notes and accounts payable
Lease liabilities
Bonds payable
Accrued expenses and other payables
(recorded as other payables)		 Carrying
Amount		 Contractual
cash flows
(251,000)
(3,406,747)
(150,347)
(167,386)
(5,200,000)
(121,131)
(9,296,611)		 Within
1 year		 1~ 2 years
Over 2 years
-
-
(846,364)
(1,926,046)
-
-
(43,873)
(79,732)
(400,000)
(2,500,000)
-
-
(1,290,237)
(4,505,778)
$ 250,998
3,406,747
150,347
163,739
5,200,000
121,131
$
9,292,962

(Continued)

34

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

December 31, 2019
Non-derivative financial liabilities:
Short-term borrowings
Secured bank loans
Notes and accounts payable
Lease liabilities
Bonds payable
Accrued expenses and other payables
(recorded as other payables)
September 30, 2019
Non-derivative financial liabilities:
Short-term borrowings
Secured bank loans
Notes and accounts payable
Lease liabilities
Bonds payable
Accrued expenses and other payables
(recorded as other payables)		 Carrying
Amount		 Contractual
cash flows
(1,530,000)
(4,046,736)
(239,126)
(227,582)
(3,100,000)
(166,436)
(9,309,880)
(1,430,000)
(4,310,489)
(179,181)
(237,406)
(3,100,000)
(82,914)
(9,339,990)		 Within
1 year		 1~ 2 years
Over 2 years
-
-
(653,519)
(2,739,698)
-
-
(88,338)
(84,717)
(2,300,000)
(400,000)
-
-
(3,041,857)
(3,224,415)
-
-
(676,625)
(2,957,239)
-
-
(55,673)
(127,266)
(2,300,000)
(400,000)
-
-
(3,032,298)
(3,484,505)
$ 1,529,883
4,046,736
239,126
222,202
3,100,000
166,436
$
9,304,383
$ 1,429,676
4,310,489
179,181
231,419
3,100,000
82,914
$
9,333,679

The Group is not expecting that the cash flows included in the maturity analysis could occur significantly earlier or at significantly different amount.

  • (iii) Exchange rate risk

The Group do not have significant exposure to foreign currency risk.

  • (iv) Interest Rate analysis

The following sensitivity analysis is based on the risk exposure to interest rate on the derivative and non-derivative financial instruments on the reporting date. Regarding the liabilities with variable interest rates, the analysis is on the basis of the assumption that the amount of assets and liabilities outstanding at the reporting date was outstanding throughout the year. The rate of change is expressed as the interest rate increases or decreases by 0.25% when reporting to management internally, which also represents management of the Group’s assessment on the reasonably possible interval of interest rate change.

If the interest rate had increased or decreased by 0.25%, the net profit before tax would have decrease or increased for the years ended September 30, 2020 and 2019 as follows:

Increased 0.25%
Decreased 0.25%		 For the nine months ended
September 30,
2020
2019
$ (7,377)
(12,560)
7,377
12,560
(Continued)

35

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

  • (v) Fair value information

  • 1) The kinds of financial instruments and fair value

The Group’s financial assets at fair value through profit or loss and financial assets at fair value through other comprehensive income are based on repeatability measured by fair value. The following table shows the carrying amounts and fair values of financial assets and liabilities, including their levels in the fair value hierarchy. It shall not include fair value information of the financial assets and liabilities not measured at fair value if the carrying amount is a reasonable approximation of the fair value and lease liability.

Book value
Financial assets at fair value
through profit or loss
Non-derivative current financial
assets mandatorily at fair
value through profit or loss
$ 528,811
Non-derivative non-current
financial assets mandatorily
at fair value through profit or
loss
90,993
Domestic listed stocks under
private placement
39,731
659,535
Financial assets at fair value
through other
comprehensive income
Domestic listed stocks
397,375
Financial assets measured at
amortized cost
Cash and cash equivalents
3,444,019
Restricted deposit
76,988
Time deposits (over three
months)
31,888
Notes and accounts receivable
(including related parties)
279,369
Other receivables
11,869
Guarantee deposits
6,475
Pledged assets-time deposits
201,160
4,051,768
Total
$
5,108,678		 September 30, 2020 September 30, 2020 September 30, 2020
Book value Fair Value
Level 1 Level 2 Level 3
Total
-
528,811
25,545
90,993
-
39,731
-
397,375
-
-
-
-
-
-
-
-
-
-
-
-
-
-
528,811
65,448
-
397,375
-
-
-
-
-
-
-		 -
-
39,731
-
-
-
-
-
-
-
-

(Continued)

36

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements


Financial liabilities measured at
amortized cost
Short-term borrowings
$ Long-term borrowings
Notes and accounts payable
Lease liabilities
Bonds payable
Accrued expenses and other
payables (recorded as
other payables)
Total
$
Financial assets at fair value
through profit or loss
Non-derivative current financial
assets mandatorily at fair
value through profit or loss
Non-derivative non-current
financial assets mandatorily at
fair value through profit or
loss
Domestic listed stocks under
private placement
Financial assets at fair value
through other comprehensive
income
Domestic listed common stock
Financial assets measured at
amortized cost
Cash and cash equivalents
Time deposits (over three
months)
Notes and accounts receivable
(including related parties)
Other receivables
Guarantee deposits
Pledged assets-time deposits
Total		 September 30, 2020 September 30, 2020 September 30, 2020
Book value

250,998
3,406,747
150,347
163,739
5,200,000
121,131
Level 1
9,292,962
Book value Level 1
14,050
62,963
-
315,134
-
-
-
-
-
-		 Fair Value
Level 2 Level 3
Total
-
14,050
25,545
88,508
-
31,046
-
315,134
-
-
-
-
-
-
-
-
-
-
-
-
$ 14,050
88,508
31,046
133,604
315,134
3,288,046
58,234
290,406
17,860
5,696
244,029
3,904,271
$
4,353,009		 -
-
31,046
-
-
-
-
-
-
-

(Continued)

37

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Financial liabilities at amortized
cost
Short-term borrowings
Long-term borrowings
Notes and accounts payable
Lease liabilities
Bonds payable
Accrued expenses and other
payables (recorded as other
payables)
Total
Financial assets at fair value
through profit or loss
Non derivative current financial
assets mandatorily at fair
value through profit or loss
Non derivative non-current
financial assets held for
trading
Domestic listed stocks under
private placement
Financial assets at fair value
through other comprehensive
income
Domestic listed stocks
Financial assets measured at
amortized cost
Cash and cash equivalents
Time deposits (over three
months)
Notes and accounts receivable
(including related parties)
Other receivables
Guarantee deposits
Pledged assets-time deposits
Total		 December 31, 2019 December 31, 2019 December 31, 2019
Book value Fair Value
Level 1
Level 2
Level 3
Total
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3,100,000
-
3,100,000
-
-
-
-
September 30, 2019		 Level 2
$ 1,529,883
4,046,736
239,126
222,202
3,100,000
166,436
$
9,304,383
Book value Fair Value
Level 1
58,012
-
-
297,479
-
-
-
-
-
-		 Level 2 Level 3
Total
-
58,012
25,788
25,788
-
32,630
-
297,479
-
-
-
-
-
-
-
-
-
-
-
-
$ 58,012
25,788
32,630
116,430
297,479
3,244,296
22,168
295,892
12,829
5,790
195,056
3,776,031
$
4,189,940		 -
-
32,630
-
-
-
-
-
-
-

(Continued)

38

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Financial liabilities measured at
amortized cost
Short-term borrowings
Long-term borrowings
Notes and accounts payable
Lease liabilities
Bonds payable
Accrued expenses and other
payables (recorded as other
current payables)
Total		 September 30, 2019 September 30, 2019 September 30, 2019
Book value Fair Value
Level 1
-
-
-
-
-
-		 Level 2 Level 3
Total
-
-
-
-
-
-
-
-
-
3,100,000
-
-
$ 1,429,676
4,310,489
179,181
231,419
3,100,000
82,914
$
9,333,679		 -
-
-
-
3,100,000
-
  • 2) Valuation techniques for financial instruments measured at fair value

A. Non-derivative financial instruments

A financial instrument is regarded as being quoted in an active market if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency and those prices represent actual and regularly occurring market transactions on an arm's-length basis. Whether transactions are taking place ‘regularly’ is a matter of judgment and depends on the facts and circumstances of the market for the instrument.

Quoted market prices may not be indicative of the fair value of an instrument if the activity in the market is infrequent, the market is not well-established, only small volumes are traded, or bid-ask spreads are very wide. Determining whether a market is active involves judgment.

Measurements of fair value of financial instruments without an active market are based on valuation technique or quoted price from a competitor. Fair value, measured by using valuation technique that can be extrapolated from either similar financial instruments or discounted cash flow method or other valuation techniques, including models, is calculated based on available market data at the reporting date.

B. Derivative financial instruments

Measurement of the fair value of derivative instruments is based on the valuation techniques generally accepted by market participants such as the discounted cash flow or option pricing models.

(Continued)

39

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

  • 3) Transfers between Level 1 and Level 2

There was no transfer from Level 1 to Level 2 of fair value of the asset during the nine months ended September 30, 2020 and 2019.

  • 4) Statement of changes in level 3
Statement of changes in level 3
Measured of fair value
through profit or loss
Non-derivative
mandatorily measured at
fair value through profit
or loss
Balance on January 1, 2020 (equal to balance on
September 30, 2020) $ 25,545
Balance on January 1, 2019 (equal to balance on
September 30, 2019) $ 25,788

(u) Financial risk management

The Group’ s objectives and policies for managing the financial risk are consistent with those disclosed in the note 6(u) of the consolidated financial statements for the year ended December 31, 2019.

(v) Capital management

The Group’ s objectives, policies and processes of capital management are the same as those disclosed in the consolidated financial statements for the year ended December 31, 2019. There were no significant changes of quantitative data of capital management compared with the consolidated financial statements for the year ended December 31, 2019. Please refer to note 6(v) of the consolidated financial statements for the year ended December 31, 2019.

(w) Investing and financing activities not affecting current cash flow

The Group’s investing activities which did not affect the current cash flow in the nine months ended September 30, 2020 and 2019.

(Continued)

40

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Reconciliation of liabilities arising from financing activities was as follows:

Short-term borrowings
Long-term borrowings
Bonds payable
Lease liabilities
Guarantee deposits (recorded as
other non-current liabilities-
others)
Total liabilities from financial
activities
Short-term borrowings
Long-term borrowings
Bonds payable
Lease liabilities
Guarantee deposits (recorded as
other non-current liabilities-
others)
Total liabilities from financial
activities		 January 1,
2020
$ 1,529,883
4,046,736
3,100,000
222,202
961
$
8,899,782
January 1,
2019
$ 939,753
5,141,068
3,100,000
273,281
608
$
9,454,710		 Cash flows
(1,278,885)
(533,798)
2,100,000
(39,478)
(298)
247,541
Cash flows
489,923
(885,605)
-
(41,862)
291
(437,253)		 Others Non-cash
changes
Foreign
exchange
movement
-
(106,191)
-
-
-
(106,191)
Non-cash
changes
Foreign
exchange
movement
-
55,026
-
-
-
55,026		 September 30,
2020
250,998
3,406,747
5,200,000
163,739
663
9,022,147
Others September 30,
2019
-
-
-
-
-		 1,429,676
4,310,489
3,100,000
231,419
899
- 9,072,483

(7) Related-party transactions

(a) Names and relationship with related parties

The followings are entities that have had transactions with related party during the periods covered in the consolidated financial statements:

Name of related party AGCMT GROUP LTD. Associated International INC. (AII) Associated Development INC. (ADI) CMT Development INC. (CMD) ASSOCIATED INTERNATIONAL (HONG KONG) LIMITED

Relationship with the Group The parent company The entity with significant influence over the Group A subsidiary of AII A subsidiary of AII Substantial associates

(Continued)

41

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(b) Significant related party transactions

(i) Logistic and agent revenue

The amounts of significant sales transactions and accounts receivable between the Group and its related parties were as follows:

The entities
with
significant
influence
over the
Group		 Revenue Revenue Accounts Receivable-
related-parties
September
30, 2020
December
31, 2019
Septembe
r 30, 2019
11,138
16,770
14,689		 Accounts Receivable-
related-parties
September
30, 2020
December
31, 2019
Septembe
r 30, 2019
11,138
16,770
14,689		 Accounts Receivable-
related-parties
September
30, 2020
December
31, 2019
Septembe
r 30, 2019
11,138
16,770
14,689
Three months
ended
September
30, 2020		 Three months
ended
September
30, 2019
14,287		 Nine months
ended
September
30, 2020
45,687		 Nine months
ended
September
30, 2019		 December
31, 2019
16,770		 Septembe
r 30, 2019
$
15,420		 42,568 14,689

The Group’s selling price for related parties is cost, plus, fixed percentage when the related parties receive cash from customers; the related parties pay the Group immediately. Amounts receivable from related parties were uncollateralized, and no expected credit loss were required after the assessment by the management.

(ii) Operating expense

The entities with significant
influence over the Group
Others		 Operating expense
Three months
ended
September 30,
2020
$ 2,230
2,049
$
4,279		 Three months
ended
September 30,
2019
1,743
2,152
3,895		 Nine months
ended
September
30, 2020
6,067
6,225
12,292		 Nine months
ended
September
30, 2019
5,305
6,419
11,724

The Group entered into service agreements with its related parties from March 2019 to February 2024. The prices are similar to those of the market prices, and they are being paid monthly.

(c) Key management personnel compensation

Key management personnel compensation comprised:

Short-term employee benefits
Post-employment benefits		 For the three months ended
September 30,
2020
2019
$ 13,851
13,869
261
280
$
14,112
14,149		 For the nine months ended
September 30,		 For the nine months ended
September 30,
2020
$ 13,851
261
$
14,112		 2020
41,892
776
42,668		 2019
39,105
11,003
50,108

(Continued)

42

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(8) Pledged assets

The carrying values of pledged assets were as follows:

Assets Subject September 30,
2020
$ 291,505
133,860
899,336
8,424,322
189,409
18,226
$
9,956,658		 December 31,
2019
296,973
92,950
899,336
9,097,270
227,935
21,790
10,636,254		 September 30,
2019
Investments accounted for
using equity method
– stock
Financial assets at fair
value through other
comprehensive income
– stock
Property, plant and
equipment – Land
Transportation and other
equipment (including
prepayment equipment)
Other current financial
assets (pledged assets-
time deposit)
Other non-current financial
assets (Guarantee
deposits and pledged
assets-time deposits)		 Commercial paper
payable – and short-
term loans and credit
lines
Commercial paper
payable – and short-
term loans and credit
lines
Short-term loans and
credit lines
Long-term loans and
credit lines
Long-term loans
Guarantee for
construction payment,
warehouse deposits,
short-term loans and
import duty		 304,105
90,350
899,336
9,503,416
178,963
21,883
10,998,053

(9) Commitments and contingencies

(a) The Group had issued guarantee promissory notes amounting to $5,647,160, 3,130,960 and 3,130,960 as of September 30, 2020, December 31 and September 30, 2019, respectively, as guarantee for bonds payable.

(b) As of September 30, 2020, the Group still had several long-term leases of its ships with customers in effect. The ending periods of the contracts are from October 2020 to September 2021.

(10) Losses Due to Major Disasters: None

(11) Subsequent Events: None

(Continued)

43

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(12) Other

(a) A summary of current-period employee benefits, depreciation and amortization, by function, is as follows:

follows:
By function
By item		 For the three months ended
September 30, 2020		 For the three months ended
September 30, 2019
Cost of
sales		 Operating
expenses		 Total Cost of
sales		 Operating
expenses		 Total
Employee benefits
Salary
Labor and health insurance
Pension
Others
Depreciation
Amortization		 84,389
2,588
1,435
6,055
226,939
-		 55,830
3,902
2,314
1,667
3,299
820		 140,219
6,490
3,749
7,722
230,238
820		 87,083
2,487
1,310
6,777
240,640
-		 53,505
4,565
2,452
2,043
2,436
804		 140,588
7,052
3,762
8,820
243,076
804
By function
By item		 For the nine months ended
September 30, 2020		 For the nine months ended
September 30, 2019
Cost of
sales		 Operating
expenses		 Total Cost of
sales		 Operating
expenses		 Total
Employee benefits
Salary
Labor and health insurance
Pension
Others
Depreciation (Note)
Amortization		 249,423
7,976
4,246
18,657
692,630
-		 161,381
12,594
6,888
6,149
9,494
2,397		 410,804
20,570
11,134
24,806
702,124
2,397		 254,599
7,321
3,720
20,363
713,346
-		 157,622
13,338
7,218
7,090
7,650
2,336		 412,221
20,659
10,938
27,453
720,996
2,336

Note: excluding the deduction of rental income of $105 both for the nine months ended September 30, 2020 and 2019.

  • (b) Seasonality of operation

The Group's operations were not affected by seasonality or cyclicality factors.

(13) Other disclosures

  • (a) Information on significant transactions:

The following is the information on significant transactions required by the “Regulations Governing the Preparation of Financial Reports by Securities Issuers” for the Group for the nine months ended September 30, 2020:

(Continued)

44

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(i) Loans to other parties:

(In Th ousands of Ne w Taiwan Dollars)
No Name of
lender		 Name of
borrower		 Account
name		 Related
party		 Highest
balance of
financing
to other
parties
during the
period		 Ending
balance		 Actual
usage
amount
during
the
period		 Range of
interest
rates
during
the
period		 Purposes
of fund
financing
for the
borrower
(note 1)		 Transaction
amount for
business
between two
parties		 Reasons
for
short-term
financing		 Allowance
for bad
debt		 Collateral Individual
funding
loan limits
(note 2)		 Maximum
limit of fund
financing
(note 3)		 Note
Item Value
1
1
1
1
1
1
1
1
2
2
2
2		 CMT HK
CMT HK
CMT HK
CMT HK
CMT HK
CMT HK
CMT HK
CMT HK
ATI
ATI
ATI
ATI		 CPN
CHN
CPD
CPC
CHM
CPG
CTU
CTD
HIL
CST
APT
PTL		 Other
receivable
due from
related
parties
〃
〃
〃
〃
〃
〃
〃
〃
〃
〃
〃		 Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y		 99,522
145,500
43,903
305,550
324,756
378,300
685,305
728,955
50,000
10,000
54,000
22,000		 99,522
145,500
-
261,900
324,756
378,300
685,305
728,955
50,000
-
47,000
19,000		 99,522
145,500
-
261,900
324,756
378,300
685,305
728,955
50,000
-
47,000
19,000		 -
-
-
-
-
-
-
-
1.20%
1.20%
1.20%
1.20%		 2
2
2
2
2
2
2
2
2
1
1
1		 -
-
-
-
-
-
-
-
-
113,344
118,050
55,279		 Operating
〃
〃
〃
〃
〃
〃
〃
〃
〃
〃
〃		 -
-
-
-
-
-
-
-
-
-
-
-		 -
-
-
-
-
-
-
-
-
-
-
-		 9,613,992
9,613,992
9,613,992
9,613,992
9,613,992
9,613,992
9,613,992
9,613,992
239,445
113,344
118,050
55,279		 9,613,992
9,613,992
9,613,992
9,613,992
9,613,992
9,613,992
9,613,992
9,613,992
239,445
239,445
239,445
239,445		 Transactions in the
left column had
been written off
during the
preparation of
consolidated
financial statements
″
″
″
″
〃
〃
〃
〃
〃
〃
〃

Note 1: 1.Represents entities with business dealings. 2. Represents where an inter-company or inter-firm short-term financing facility is necessary.

Note 2 : For entities who have business with the Company, the amount of endorsements permitted for a single company shall not exceed the transaction amount in the last fiscal year and 40% of the lender’s net worth. For entities who have short-term financing needs, amount shall not exceed 40% of the lender’s net worth. The amount lendable to directly or indirectly wholly owned foreign subsidiaries is not limited by the restriction of 40% of the lender’s net worth, only the total amount lending limit shall still be no more than the net worth of each subsidiary.

Note 3: The total amount available for financing purposes shall not exceed 40% of lender’s net worth. Investee whose voting shares, directly or indirectly, owned by the Company is unrestricted by the limitation mentioned above; however, the amount available for financing shall not exceed 100% of net worth of the investee.

(ii) Guarantees and endorsements for other parties:

(In Thousands of New Taiwan Dollars)

No. Name of
guarantor		 Counter-party of
guarantee and
endorsement		 Counter-party of
guarantee and
endorsement		 Limitation
on
amount of
guarantees and
endorsements
for a specific
enterprise
(note2, note3)		 Highest
balance for
guarantees
and
endorsements
during
the period
(note 4)		 Balance of
guarantees
and
endorsements
as of
reporting
date
(note 4)		 Actual
usage
amount
during the
period
(note 4)		 Property
pledged for
guarantees
and
endorsements
(Amount)		 Ratio of
accumulated
amounts of
guarantees and
endorsements to
net worth of the
latest
financial
statements
 Maximum
amount for
guarantees and
endorsements		 Parent
company
endorsements/
guarantees to
third parties on
behalf of
subsidiary		 Subsidiary
endorsements
/
guarantees
to third
parties on
behalf of
parent
company		 Endorsements
/
guarantees to
third parties
on behalf of
companies in
Mainland
China
Name Relationship
with the
Company
0
0
0
0
0
1
1
1
1		 THE
COMPANY

〃
C
〃
C
〃
C
〃
C
CMT HK
C
〃
C
〃
C
〃
T
C		 ATI
TU

TD

FR

PN

HN
EP
HM
HE
OMPANY		 Subsidiary
Sub-subsidiary
Sub-subsidiary
Sub-subsidiary
Sub-subsidiary
Subsidiary
Subsidiary
Subsidiary
Parent
company		 14,697,908
14,697,908
14,697,908
14,697,908
14,697,908
14,420,988
14,420,988
14,420,988
14,420,988		 100,000
654,750
654,750
1,293,495
1,309,500
881,439
930,618
949,242
3,783		 -
261,900
261,900
1,293,495
1,309,500
722,844
930,618
949,242
3,783		 -
196,425
196,425
626,324
535,045
691,125
690,616
470,786
3,783		 -
-
-
-
-
-
-
-
-		 %
-
%
2.67
%
2.67
%
13.20
%
13.36
%
7.52
%
9.68
%
9.87
%
0.04		 14,697,908
14,697,908
14,697,908
14,697,908
14,697,908
14,420,988
14,420,988
14,420,988
14,420,988		 Y
Y
Y
Y
Y
-
-
-
-		 -
-
-
-
-
-
-
-
Y		 -
-
-
-
-
-
-
-
-

(Continued)

45

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Note1: The total amount of external endorsements and/or guarantees shall worth no more than 150% of the Company’s net worth. Among which the amount of endorsements/ guarantees for any single (1) whose voting shares are 100% owned by the Company shall not exceed 150% of the Company’s net worth. (2) company whose more than 80% voting shares are owned by the Company shall not exceed 30% of the Company’s net worth. Note2: CMT HK’s total amount of external endorsements/ guarantees shall not exceed 150% of its net worth. Among which, the amount of endorsements/ guarantees for any single (1) investee who has, directly or indirectly, 100% voting shares of the Company and whose voting shares are 100% owned by the Company shall not exceed 150% of the Company’s net worth. (2) an entity who has more than 80% voting shares and is owned directly by the Company shall not exceed 30% of the Company’s net worth. (3) an entity who has less than 80% voting shares and is owned directly by the Company shall not exceed 10% of the Company’s net worth. Note3: The amount was translated to the NTD at the exchange rates at the reporting date.

  • (iii) Securities held at the reporting date (excluding investment in subsidiaries, associates and joint ventures):
(In Thousands o f New Taiwan Dollars) f New Taiwan Dollars)
Name of
holder		 Category and
name of
security		 Relationship
with company		 Account
title		 Ending balance Note
Shares/Units
(thousands)		 Carrying
value		 percentage
of ownership
(%)		 Fair value
THE
COMPANY
〃
HIL
〃
〃
MHI
〃
〃		 Yang Ming Marine Transport
Corporation
Asia Pacific Emerging Industry
Venture Capital Co., Ltd.
CHINA CONTAINER
TERMINAL CORP.
SEA & LAND INTERATED
CORP.
DIMERCO EXPRESS
CORPORATION
SEA & LAND INTERATED
CORP.
CHINA CONTAINER
TERMINAL CORP.
DIMERCO EXPRESS
CORPORATION		 -
-
-
-
-
-
-
-		 Non-current financial assets at
fair value through profit or loss
Non-current financial assets at
fair value through profit or loss
Non-current financial assets at
fair value through other
comprehensive income
Non-current financial assets at
fair value through profit or loss
Current financial assets at fair
value through profit or loss
Non-current financial assets at
fair value through profit or loss
Non-current financial assets at
fair value through other
comprehensive income
Current financial assets at fair
value through profit or loss		 4,798
2,500
21,964
5,522
2,555
1
5,347
6,288		 39,731
25,545
319,582
65,436
152,789
12
77,793
376,022		 0.18 %
2.78 %
14.80 %
7.05 %
2.03 %
-
%
3.60 %
4.99 %		 39,731
25,545
319,582
65,436
152,789
12
77,793
376,022

  • (iv) Individual securities acquired or disposed of with accumulated amount exceeding the lower of NT$300 million or 20% of the capital stock: None

  • (v) Acquisition of individual real estate with amount exceeding the lower of NT$300 million or 20% of the capital stock: None

  • (vi) Disposal of individual real estate with amount exceeding the lower of NT$300 million or 20% of the capital stock: None

  • (vii) Related-party transactions for purchases and sales with amounts exceeding the lower of NT$100 million or 20% of the capital stock:

(In Thousands of New Taiwan Dollars)

Name of
company		 Related
party		 Nature of
relationship		 Transaction details Transaction details Transaction details Transactions with terms
different from others		 Transactions with terms
different from others		 Notes/Accounts
receivable (payable)		 Notes/Accounts
receivable (payable)
Note
Purchase/
Sale		 Amount Percentage
of total
purchases/
sales		 Payment
terms		 Unit price
Payment
terms		 Ending
balance		 Percentage
of total
notes/accoun
ts receivable
(payable)
THE
COMPANY
ATI		 ATI
THE
COMPANY		 Subsidiary
Subsidiary		 Freight cost
Freight
revenue		 420,674
(420,674		 %
96
)
%
(55)		 Depending on the
demand for funding
of subsidiaries
〃		 -
-		 (53,786)
53,786		 (98)%
31%		 Note 1
〃

Note1: Transactions in the left column had been written off during the preparation of the consolidated financial statements.

(Continued)

46

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

  • (viii) Receivables from related parties with amounts exceeding the lower of NT$100 million or 20% of the capital stock:
(In Thousands of New Taiwan Dollars) (In Thousands of New Taiwan Dollars) (In Thousands of New Taiwan Dollars) (In Thousands of New Taiwan Dollars) (In Thousands of New Taiwan Dollars)
Name of
company		 Counter-party Nature of
relationship		 Ending
balance		 Turnover
rate		 Overdue Amounts
received in
subsequent
period		 Allowance
for bad
debts		 Note
Amount Action
taken
CMT HK
〃
〃
〃
〃
〃		 CTD
CTU
CHM
CPC
CHN
CPG		 Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary
Subsidiary		 728,955
685,305
324,756
261,900
145,500
378,300		 Note1
〃
〃
〃
〃
〃		 -
-
-
-
-
-		 -
-
-
-
-
-		 -
-
-
-
-
-		 Note 2
〃
〃
〃
〃
〃

Note1: They are accounts receivable from related parties.

Note2: Transactions in the left column had been written off during the preparation of the consolidated financial statements.

  • (ix) Trading in derivative instruments: None

  • (x) Business relationships and significant intercompany transactions:

No.
(Note 1)		 Name of
company		 Name of
counter-party		 Nature of
relationship
(Note 2)		 Intercompany transactions Intercompany transactions Intercompany transactions
Account name Amount Trading terms Percentage of
the
consolidated
net revenue or
total assets
1
6
6
6
6
6
6		 ATI
CMT HK
CMT HK
CMT HK
CMT HK
CMT HK
CMT HK		 THE COMPANY
CTD
CTU
CHM
CPC
CHN
CPG		 2
3
3
3
3
3
3		 Operating
revenues
Other
receivables
〃
〃
〃
〃
〃		 420,674
728,955
685,305
324,756
261,900
145,500
378,300		 Price depends on the
market, and the receivables
depend on funding demand
in the credit period
-
-
-
-
-
-		 17.99%
3.69%
3.47%
1.64%
1.32%
0.74%
1.91%

Note 1: The companies are coded as follows:

  1. 0 represents the parent company.

  2. The subsidiaries are coded sequentially beginning from 1 in the order of companies’ names.

Note 2: The relationships with transactions are as follows:

  1. Transactions from the parent company to its subsidiaries.

  2. Transactions from the subsidiaries to the parent company.

  3. Transaction between subsidiaries.

(Continued)

47

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

(b) Information on investees:

The following is the information on investees for the nine months ended September 30, 2020:

(In Thousands of Shares)

(In Thousands of New Taiwan Dollars)

Name of
investor		 Name of
investee		 Location Main
Businesses and Products		 Original I
Amo		 nvestment
unt		 Balance a s of September 30, 2020 Net I ncome
September 30,
2020		 December 31,
2019		 Shares
(thousands)		 Percentage of
Ownership		 Carrying
Value		 (Losses) of the
Investee		 Share of
profits/losses of
investee		 Note
The Company
〃
〃
〃
〃
〃
〃
〃
〃
〃
〃
〃
〃
CMTS
〃
CMT HK
〃
CMT HK
〃
〃
〃
〃
〃
〃
〃
〃
〃
〃
HIL
ATI
〃
〃
〃
〃		 CMTS
CMT HK
CMTL
AGMI
HIL
MHI
ATI
TNCL
CMTTSL
TGEM
UNH
UHD
AGM
CFR
CEP
CPS
CPG
CPC
CHT
CPN
CPD
CTD
CTU
CHM
CHN
CHI
CIM
CMTS
TNCL
CST
HYT
MHT
APT
PTL		 Singapore
Hong Kong
Taiwan
〃
〃
〃
〃
〃
〃
〃
〃
〃
〃
Singapore
〃
Hong Kong
〃
〃
〃
〃
〃
〃
〃
〃
〃
〃
〃
Singapore
Taiwan
〃
〃
〃
〃
〃		 Investment holding of ship-
owning companies
Investment holding of ship-
owning companies
Warehouse management
Investment
〃
〃
Container trucking
Bulk-carrier transportation
Travel
Bulk-carrier transportation
Gasoline international trade
Investment
Automobile and its parts
manufacturing
Bulk-carrier transportation
〃
〃
〃
〃
Bulk-chartering services
Bulk-carrier transportation
〃
〃
〃
〃
〃
Investment management
〃
Investment holding of ship-
owning companies
Bulk-carrier transportation
Container trucking
〃
〃
〃
〃		 4,282
34,356
734,058
1,000
605,000
271,300
500,000
1,007,412
20,000
601,200
1,000
1,000
30,000
669,300
672,210
58,200
174,600
160,050
291
698,400
1,222,200
378,300
378,300
436,500
436,500
291
29,100
1,379,340
321,956
86,642
28,932
30,568
30,719
30,000		 4,282
34,356
689,558
1,000
785,000
101,300
500,000
1,007,412
20,000
601,200
1,000
1,000
30,000
669,300
672,210
58,200
174,600
160,050
291
698,400
1,222,200
378,300
378,300
436,500
436,500
291
29,100
1,379,340
321,956
86,642
28,932
30,568
30,719
30,000		 217
12,000
23,650
100
60,500
27,130
50,000
31,125
2,000
61,623
100
100
3,000
29,900
23,100
2,000
6,000
5,500
10
240
420
13,000
13,000
150
150
0.1
10
62,918
12,297
8,200
3,000
3,000
3,000
3,000		 %
0.34
%
100
%
100
%
100
%
100
%
100
%
100
%
7.459
%
100
%
12
%
100
%
100
%
30
%
100
%
100
%
100
%
100
%
100
%
100
%
100
%
100
%
100
%
100
%
100
%
100
%
100
%
100
%
99.66
%
2.947
%
100
%
100
%
100
%
100
%
100		 5,075
9,613,992
1,086,603
993
780,581
460,309
598,613
749,829
4,437
607,762
982
976
25,759
731,129
670,355
58,435
190,535
181,776
5,520
774,930
1,201,367
371,732
455,730
452,002
454,879
(490)
29,735
1,487,674
296,253
92,327
28,639
51,465
32,265
25,249		 54
77,208
29,924
(21)
76,502
184,061
14,855
345,667
(1,324)
206,595
-
-
(8,726)
2,384
1,599
(44)
19,915
(3,913)
(105)
24,429
(5,339)
(26,089)
32,037
24,455
25,791
(121)
202
54
345,667
227
(6,346)
8,286
(3,814)
(3,692)		 -
77,208
29,924
(21)
76,502
184,061
14,855
25,782
(1,324)
24,791
-
-
(2,618)
Has been recognized
as investment
incomes(losses) by
CMTS
〃
Has been recognized
as investment
incomes(losses) by
CMT HK
〃
〃
〃
〃
〃
〃
〃
〃
〃
〃
〃
〃
Has been recognized
as investment
incomes(losses) by
HIL
Has been recognized
as investment
incomes(losses) by
ATI
-
-
-
-		 Note1、Note4
〃
〃
〃
〃
〃
〃
Note2
Note1、Note4
Note2
Note1、Note4
〃
Note2
Note1、Note3
、Note4
〃
〃
〃
〃
〃
〃
〃
〃
〃
〃
〃
〃
〃
〃
Note2
Note1、
Note4
〃
〃
〃
〃

Note1: Subsidiaries controlled by the parent company. Note2: Investees affected by the comprehensive shareholdings of the Group.

Note3: The amount was translated to the NTD at the exchange rates at the reporting date.

Note4: The account had been written off during the preparation of consolidated financial statements. 。

(Continued)

48

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

  • (c) Information on investment in mainland China: None

  • (d) Major shareholders:

Shareholder’s Name Shares Percentage
AGCMT GROUP LTD. 79,685,475 %
40.35
Associated International INC. (AII) 42,924,297 %
21.73

(14) Segment information

(a) General information

The Group’s reportable segments consist of the Land Transportation, and the Logistics Segment and the Sea Transportation Segment. The land transportation and the logistics segment engage in the container transportation business, warehousing business, and freight agent business. And the sea transportation segment engages in the bulk carrier business. The Group’s reportable segments are the strategic business units that provide different kinds of transportation services. Each strategic business unit requires different services and marketing strategies, thus, should be managed separately.

(b) Reportable segment information

The amounts of the Company’s reportable segments are the same as those in the report used by the chief operating decision maker. The accounting policies for the operating segments are the same as those in Note 4, which describe significant accounting policies. The Company’s operating segments’ income before tax was the foundation for the chief operating decision maker to evaluate performance. There was no transfer of revenue between segments.

Revenue from external
customers
Intersegment revenue
Total revenues
Segment income before tax
Reportable segment assets		 Three months ended September 30, 2020 Total
Inland
trucking and
terminal &
logistics
department
$ 377,573
-
$
377,573
$
(1,814)		 Shipping
department
399,782
-
399,782
33,946		 Others
8,470
-
8,470
550
785,825
-
785,825
32,682

(Continued)

49

CHINESE MARITIME TRANSPORT LTD. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

Revenue from external
customers
Intersegment revenue
Total revenues
Segment income before tax
Reportable segment assets
Revenue from external
customers

Intersegment revenue
Total revenues

Segment income before tax

Reportable segment assets
Revenue from external
customers

Intersegment revenue
Total revenues

Segment income before tax

Reportable segment assets		 Three months ended September 30, 2019 Three months ended September 30, 2019 Three months ended September 30, 2019
Inland
trucking and
terminal &
logistics
department		 Shipping
department
Others
463,599
5,250
-
-
463,599
5,250
88,548
988
Nine months ended September
$ 458,268
-
$
458,268
$
18,322
Inland
trucking and
terminal &
logistics
department
$ 1,097,967
-
$
1,097,967
$
3,865		 Shipping
department
Others
1,214,209
26,199
-
-
1,214,209
26,199
118,798
2,357
Nine months ended September		 Adjustments
and
eliminations
-
-
-
-
$
30, 2019
Inland
trucking and
terminal &
logistics
department
$ 1,369,619
-
$
1,369,619
$
52,340		 Shipping
department
1,449,393
-
1,449,393
319,269		 Others
21,728
-
21,728
2,639		 Adjustments
and
eliminations
-
-
-
-
$

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