83
Year ended 31 December 2015
Annual Report 2015
NOTES TO
THE FINANCIAL STATEMENTS
31. Capital management policies and objectives (Continued)
The Group and the Company manage capital by regularly monitoring its current and expected
liquidity requirements. The Group and the Company are subject to the rules and regulations of the
foreign exchange control promulgated by the PRC government for conversion of RMB into foreign
currencies. The Group is also subject to a bank covenant for its bank borrowings to maintain a
debt/equity ratio of 85% (Note 22).
As disclosed in Note 25, a subsidiary of the Group is required by the relevant PRC regulations to
contribute to and maintain a non-distributable statutory reserve fund whose utilisation is subject to
approval by the relevant PRC authorities.
The Group also monitors capital on the basis of the debt to equity ratio. This ratio is calculated as
total liabilities divided by equity. Total liabilities are sum of “current liabilities” and “non
-current
liabilities” and equity is “shareholders’ equity”
as shown in the statements of financial position.
The Group’s strategy was to maintain the debt to equity ratio under 1. The debt
-equity ratios as at 31
December 2015 and 2014 were as follows:
Group
2015
2014
RMB’000
RMB’000
Total liabilities
461,869
476,253
Equity
85,797
34,127
Debt to equity ratio
5.38
13.96
The management is continuously considering various measures to improve on the ratio above.
The Group’s overall strategy remains unchanged from 201
4.
32. Segment reporting
Management has determined the operating segments based on the reports reviewed by the chief
operating decision-maker (Note 2.18).
The principal operation of the Group relates almost entirely to the import, processing, storage and
distribution of LPG in the PRC and Asia Pacific region. All the non-current assets are located in the
PRC.
In presenting information on the basis of geographical segments, segment revenue is based on the
geographical presence of the markets.
Distribution of total sales by geographical markets:
Group
2015
2014
RMB’000
RMB’000
PRC
1,722,874
1,767,557
Asia Pacific
191,989
220,852
1,914,863
1,988,409
Major customers
The revenues from one customer, which is a related
party, of the Group’s trading segment represent
approximately RMB288,727,000. (2014: RMB154,991,000).
Other information relating to segmental results and assets are disclosed in the respective notes to the
financial statements.
