粤电力Ａ(000539)粤电力Ｂ2002年年度报告（英文版）

GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. ANNUAL REPORT 2002 Important Notice The Board of Directors of the Company assures that there is no untrue presentations, nor seriously misleading statements, nor omission of material facts contained in the information hereinto. Chairman of the Board of Directors, Pan Li, general manager, Liu Xian and finance department manager, Liu Xuemao severally and jointly accept responsibility for the correctness, accuracy and completeness of the information contained in this annual report. The reader is advised that this report has been prepared originally in Chinese. In the event of a conflict between this report and the original Chinese version or difference in interpretation between the versions of the report, the Chinese language report shall prevail. CONTENTS I. GENERAL INFORMATION OF THE COMPANY II. SUMMARY OF ACCOUNTING AND OPERATING DATA III. CHANGES IN SHARE CAPITAL AND DETAILS OF SHAREHOLDING STRUCTURE IV. INFORMATION OF DIRECTORS, SUPERVISORS, SENIOR MANAGEMENT AND EMPLOYEES V. CORPORATION GOVERNANCE STRUCTURE VI. GENERAL SHAREHOLDERS MEETING VII. REPORT OF THE DIRECTORS VIII. REPORT OF THE SUPERVISORY COMMITTEE IX. SIGNIFICANT EVENTS X. FINANCIAL STATEMENTS Consolidated Financial Statements Together with International Auditors’ Report Issued by PricewaterhouseCoopers Zhong Tian CPAs Co., Ltd.(“ PricewaterhouseCoopers”) XI. DOCUMENTS AVAILABLE FOR INSPECTION I. CORPORATE INFORMATION 1. Official Chinese name of the Company: 广东电力发展股份有限公司 Official English name of the Company: GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. (Abbreviation: GED) 2. Legal representative: Mr. Pan Li 3. General manager: Mr. Liu Qian 4. Secretary to the Board of Directors: Mr. Zhang De Wei Telephone: (8620)87609276 Facsimile: (8620)87609909 Email: zhangdw@ged.com.cn Representatives on security issues: Mr. Chen Jin Liang Telephone: (8620) 87604922 Facsimile: (8620) 87609909 Email: chenjl@ged.com.cn Company’s correspondence address: 10/F., Boli Commercial Centre, Guang Fa Garden, 498 Huan Shi Dong Road, Guangzhou, Guangdong Province Postal code : 510075 5. Company’s registered and office address: 10/F., Boli Commercial Center, Guang Fa Garden, 498 Huan Shi Dong Road, Guangzhou, Guangdong Province Postal code : 510075 Company’s E-mail address: ged@www.ged.com.cn Company’s Web site: http://www.ged.com.cn 1. Newspapers selected by Company Securities Times, China Securities, Shanghai Securities, Hong Kong Commercial (overseas Chinese and English) Web site designated by CSRC to publish Company’s annual report: http://www.cninfo.com.cn Place where Company’s annual report is kept: Office of Board Affairs 2. Place of listing, Abbreviation and code the Company’s shares: Place of listing of Company’s shares: Shenzhen Stock Exchange Abbreviation of Company’s shares: Yue Dian Li A and Yue Dian Li B Code of Company’s shares: 000539 and 200539 -1- I. CORPORATE INFORMATION (Cont’d) 8. Other information: 1) Company’s first registration date: November 3,1992 Correspondence address: 10/F., Boli Commercial Centre, Guang Fa Garden, 498 Huan Shi Dong Road, Guangzhou, Guangdong Province 2) Business Registration No. “Qi He Yue Zong Zi” No.002753 3) Tax registration No. “Guo Shui Sui Wai Zi 440101617419493 “ Di Shui Sui Wai Zi 440100617419493 4) Names of the Company’s Auditors: (1) Pan-China Certified Public Accountants Office address: 17/F, Bldg. A, Investment Plaza,27 Financial Street, West District, Beijing (2)PricewaterhouseCoopers Zhong Tian CPAs Co., Ltd. Office address: 12th Floor, Shui On Plaza 333 Huai Hai Zhong Lu Shanghai 200021 eople’s Republic of China 6) Legal Consultant: Guangdong Xin Yang Lawyers Firm Office address: 25/F, Peace World Plaza, Huan Shi Dong Road, Guangzhou II. SUMMARY OF ACCOUNTING AND OPERATING DATA Summary of major accounting and operating data of the Group prepared in accordance with International Financial Reporting Standards (“IFRS”) and audited by PricewaterhouseCoopers are as follows: 1. Major accounting data for current year: RMB’000 Income from sales of electricity 5,586,730 Cost of sale of electricity 3,507,308 Operating profit 2,079,422 Other income, net 19,147 Profit before taxation 1,976,852 Net profit 1,179,746 Net cash flows from operating activities 2,571,027 -2- II. SUMMARY OF ACCOUNTING AND OPERATING DATA (Cont’d) 2. Three-year major accounting data and financial yardstick summary Unit RMB’000 Yardstick item Year 2002 Year 2001 Year 2000 (1) Income from sales of electricity 5,586,730 5,386,785 4,242,010 (2) Net profit 1,179,746 1,051,805 971.104 (3) Earnings per share (RMB) 0.44 0.40 0.38 (4) Net cash flow per share from operating activities 0.97 0.59 0.80 December 31 December 31 December 31 Yardstick item 2002 2001 2000 (5) Total Assets 11,872,866 12,416,341 11,304,692 (6) Shareholders’ Equity 7,397,470 6,802,793 5,156,032 (7) Net assets per share (RMB’000) 2.78 2.56 2.00 (8) Return on equity (%) 17 18 19 Schedule to the income statement of 2002 Return on net assets (%) Earnings per share (RMB) Item Basic* Diluted* Basic* Diluted* Profit from sales of electricity 29.29% N/A 0.78 N/A Profit before tax 27.84% N/A 0.74 N/A Net profit 16.62% N/A 0.44 N/A Calculation method of financial yardstick items were as below: (1) Basic return on equity = Profit for the year/ Average net assets (2) Basic earning per share= Net profit for the year/ Weighted average number of ordinary shares ** The formula of Basic Earning Per Share (Basic EPS) was as below: Basic EPS = P S0+ S1 + Si Mi M0 Sj Mj M0 Hereinto, P represents profit for the year; S0 represents number of ordinary shares at the beginning of the year; S1 represents the addition of number of ordinary shares due to the transfer from capital reserve to capital stock or distribution of stock dividends; Si represents r the addition of number of ordinary shares due to the issuance of shares or transfer from debts during the year; Sj represents the decrease of number of ordinary shares due to the purchase or withdraw of shares during the year; M0 represents number of months for the year; Mi represents number of months from the month that shares addition to the year end; Mj represents number of months from the month that shares decrease to the year end. -3- II. SUMMARY OF ACCOUNTING AND OPERATING DATA (Cont’d) 3. Explanations for differences between Company’s profit for the year as reported by domestic and international auditors The adjustments made by PricewaterhouseCoopers in accordance with IAS Accounting Regulations on the Group’s profit for the years are as follows: Group’s profit for the year Group’s total assets RMB’000 RMB’000 As reported in statutory accounts (audited by certified public accountants in the PRC) 1,189,985 6,630,638 Impact of IFRS adjustments: Write-off of start-up costs (11,086) (11,086) Additional provision for fixed assets repair 12,730 12,730 Reversal of the loss on housing under PRC GAAP - 130,224 Amortization of deferred staff costs (13,022) (35,714) Reversal of over-amortization of land use right - 61,886 Deferred tax - 11,990 Proposal dividend on 2003 for the year 2002 - 611,663 Others 1,139 (14,861) As restated for the Group 1,179,746 7,397,470 -4- II. SUMMARY OF ACCOUNTING AND OPERATING DATA (Cont’d) 4. Consolidated statements of changes in shareholders’ equity for the year ended 31 December 2002 RM B’000 Reserves Statutory Statutory Discretionary surplus public welfare surplus Retained Share capital Capital reserve reserve fund reserve earnings Total Balances at 1 January 2001 2,575,404 473,320 476,028 204,675 776,672 649,933 5,156,032 Issue of new shares 84,000 940,800 - - - - 1,024,800 Issuance expenses - (31,280) - - - - (31,280) Donation of fixed assets - 347 - - - - 347 Transfer - - 30,658 (30,658) - - - Dividends relating to 2000 - - - - - (398,911) (398,911) Net profit - - - - - 1,051,805 1,051,805 Appropriation from retained earnings - - 105,777 52,888 123,443 (282,108) - Balances at 1 January 2002 2,659,404 1,383,187 612,463 226,905 900,115 1,020,719 6,802,793 Dividends relating to 2001 - - - - - (585,069) (585,069) 1,179,74 Net profit - - - - - 1,179,746 Appropriation from retained earnings - - 118,999 59,499 264,442 (442,940) - Balances at 31 December 2002 2,659,404 1,383,187 731,462 286,404 1,164,557 1,172,456 7,397,470 -5- III. CHANGES IN SHARE CAPITAL AND DETAILS OF SHAREHOLDING STRUCTURE 1. Changes in share capital (1) Summary of changes in share capital Unit: shares Changes during year +,- Converted from Balance at capital beginning of Rights Bonus Additional Balance at end Type of Shares year issue issue reserve Issuance Others Sub-total of the year I. Non-listed shares 1. Promoters’ shares Including: 1,553,175,000 1,553,175,000 - State-owned shares 1,375,007,400 1,375,007,400 - Domestic legal 178,167,600 178,167,6 person shares 00 - Foreign legal person shares - Others 2.Subscriber legal 49,413,000 49,413,000 person shares 3.Employee shares 4.Preferred Shares or others: Total 1,602,588,000 1,602,588,000 II. Listed shares 1. Domestic listed RMB ordinary shares 391,476,000 391,476,000 2. Domestic listed foreign shares 665,340,000 665,340,000 3. Overseas listed foreign shares 4. Others Total 1,056,816,000 1,056,816,000 III. Total shares 2,659,404,000 2,659,404,000 (2) Issuance and listing of shares The Company has no issuance or listing of shares in 2002. -6- III. CHANGES IN SHARE CAPITAL AND DETAILS OF SHAREHOLDING STRUCTURE (Cont’d) 2. Information about shareholders (1) As at December 31,2002, the Company has 124,341 shareholders, including 72,205 A shareholders, 52,136 B shareholders. (2) Top 10 major shareholders (as at December 31.2001) Number of shares Proportion to total Name of shareholders held share capital (%) Guangdong Electric Power Holding Co.* 1,333,800,000 50.15 Guangdong Trust and Investment Company of 87,750,000 3.30 Construction Bank of China Guangdong Electric Power Development Co. 85,082,400 3.20 Ltd TEMPLETON WORLD FUND,INC. 64,681,530 2.43 Guangdong Guangkong Group** 43,875,000 1.65 Northwest Securities Co., Ltd 10,100,000 0.38 Great Wall Securities Co., Ltd 9,557,322 036 Xiangcai Securities Co., Ltd 8,214,081 0.31 TOYO SECURITIES ASIA LIMITED-A/C 5,718,279 0.22 CLIENT. Xianyou Huang 5,203,700 0.20 Notes: * Pursuant to the Approval on the Implementation Plan of Guangdong Province’s Reform of Power Industry Structure Relating to Separation of Generation and Transmission Assets, a document issued by Guangdong Provincial Government and referred to as Yue Fu Han [2001] No.252, the shares of the company formerly held by Guangdong Electric Power Holding Co. was transferred to Guangdong Yuedian Assets Management Co., Ltd. (“Yuedian”). The formality of registration of equity interest transfer is still in progress. Its holding stock cannot be impawned. ** Pursuant to the PRC policy about business bank cannot directly hold shares of enterprises, Guangdong development bank had transferred its shares to Guangdong Guangkong Group Co., Ltd during the year. Guangdong Guangkong Group Co., Ltd was a wholly-owned subsidiary approved by the Guangdong Province Government and was responsible to manage the financial assets of Guangdong Development Bank. (3) Information of share holders who hold more than 10% (Inclusive) of the Company’s shares: Yuedian holds 50.15% shares of the Company. Its legal representative is Mr. Panli. It is mainly engaged in management of power plants and power generation assets, construction of power plants, and sale of electricity. Its registered capital is RMB 3 billion. -7- IV. INFORMATION OF DIRECTORS, SUPERVISORS SENIOR MANAGEMENT AND EMPLOYEES 1. Information about the Company’s current Directors, Supervisors and senior management: Name Gender Age Position Period of Service Shares held at Shares held Opening of year at year-end Pan Li Male 48 Chairman 2002.5-2005.5 - - Deng An Male 52 Vice-Chairman 2002.5 2005.5 - - Liu Qian Male 48 Director, General Manager 2002.5 2005.5 - - Hong Kunrong Male 45 Director 2002.5 2005.5 - - Li Xihua Male 55 Director, Factory Director 2002.5 2005.5 - - Cao Teyang Male 36 Director 2002.5 2005.5 - - Yuan Sujie Male 42 Director, Deputy General 2002.5 2005.5 - - Manage Yu Fumin Male 60 Director 2002.5 2005.5 - - Lao Qiong Juan Female 48 Director 2002.5 2005.5 - - Zou Xiao Pin Male 38 Director 2002.5 2005.5 - - Wang Jun Male 44 Independent Director 2002.5 2005.5 - - Zhang Zhiyue Male 36 Independent Director 2002.5 2005.5 - - Song Xian Zhong Male 39 Independent Director 2002.5 2005.5 2,750 2,750 Cheng Xinxin Female 49 Independent Director 2002.5 2005.5 - - Zhu Baohe Male 40 Independent Director 2002.5 2005.5 - - Yang Xuan Xing Male 37 Chairman of Supervisory 2002.5 2005.5 - - Committee Xu Run Xiong Male 57 Supervisor 2002.5 2005.5 - - Xin Huan Pin Male 39 Independent Supervisor 2002.5 2005.5 - - Liang Ru Yu Male 35 Independent Supervisor 2002.5 2005.5 - - Lin Wei Feng Male 34 Supervisor 2002.5 2005.5 3,000 3,000 Chen Jin Liang Male 38 Supervisor 2002.5 2005.5 7,100 7,100 Luo Zhi Heng Male 35 Deputy General Manager 2002.5 2005.5 - - Zhang De Wei Male 41 Secretary to the Board of 2002.5 2005.5 12,480 12,480 Directors Liu Xue Mao Female 47 Finance Manager 2002.5 2005.5 - - Total 25,330 25,330 2. Remunerations of directors, supervisors and senior management of the Company Principle of remuneration: the Company has not set up its own principle of annual remuneration for senior management. The salary and welfare of senior management are determined with reference to the principle of Yuedian. Remunerations of certain directors and supervisors are not paid by the Company, and are paid by respective shareholders instead. The Company does not provide additional salaries, allowances or welfares to directors and supervisor. There are eight directors and supervisors whose remunerations are not paid by the Company. They are: Pan Li, Deng An, Hong Rongkun, Chao Techao, Lao Qiongjuan, Zou Xiaoping, Yang Xuanxin, and Xu Runxiong; Remuneration of nine directors, supervisors and senior management personnel are paid by the company, they are: Liu Qian, Li Xihua, Yuan Sujie, Yu Fumin (Director), Lin Weifeng, Chen Jinliang (Supervisor), Luo Zhiheng (Deputy General manager), Zhang Dewei (Secretary to the Board of Directors), and Liu Xuemao (Financial manager). They are paid according to the Company’s principle on staff payroll and welfare. No additional salary or welfare was paid to them. -8- IV. INFORMATION OF DIRECTORS, SUPERVISORS SENIOR MANAGEMENT AND EMPLOYEES (CONT’D) 2. Remunerations of directors, supervisors and senior management of the Company (Cont’d) During the year, allowance for independent directors was RMB 80,000 per annum per person (tax inclusive). They are: Wang Jun, Zhang Zhiyue, Song Xianzhong, Cheng Xinxin, and Zhu Baohe. Allowance for the independent supervisors was RMB 30,000 per annum per person (tax inclusive), they are Xin Huampin and Liang Ruyu. Total remuneration paid to current directors, supervisors and senior management was RMB 1,306,000. Total amount paid for top three directors was RMB 515,000.Seven that were paid over RMB 100,000, two were paid between RMB 50,000 and RMB 100,000, and seven were paid below RMB 50,000. 3. Directors, Supervisors and Senior Management Personnel who resigned in reporting period: In May 2002, the company had elected the forth hold directors and supervisors. The board had appointed general manager, deputy general manager, secretary to the board of the directors and finance manager. The supervisory committee had appointed its chairman and secretary. For details, please refer to Announcement of General Shareholders Meetings, Report of the Directors and Report of the Supervisory Committee respectively. 4. Particulars of employees At the end of 2002, the Company had 1,725 employees, including 407 technicians, 963 production workers, 20 finance staffs, 90 administrative and management staffs and 245 retired staffs. Current employees consisted of 381 college graduates or above, 1065 technical secondary school or high school graduates and 279 junior high school graduates or below. Over 98.2% of the staff work in Shajiao A Power Plant and others work at the headquarters of the Company. V. CORPORATION GOVERNANCE STRUCTURE 1. General information about the Company’s corporation governance structure Since its incorporation in 1993 and listing of its shares, the Company continuously improves its infrastructure to be in line with the improvement of external legal environment. The Company set up its own administrative organization in accordance with the Company Law, the Securities Law of the PRC as well as principles set forth by CSRC and the Listing Rules of Shenzhen Stock Exchange. Base on the Guidance on Articles of Association Governance Principles set forth by the CSRC, the company had edited and consummated the Articles of Association, the Standing Orders of the Shareholders’ Convention, the Standing Orders of the Boards, Standing Orders of the Supervisor Committee, Detail Working Regulation of the General Manager and Reporting Disclosure Management Rules. -9- V. CORPORATION GOVERNANCE STRUCTURE (CONT’D) 1.General information about the Company’s corporation governance structure (cont’d) In Jun 2002, the Company had begun self-check activities according to the Notice on Inspection of Corporate Governance Structure of Listing Companies, issued by CSRC Guangdong Office and Economic and Trading Committee of Guangdong Province. Together with the parent company , the Company reported the self-check result to the CSRC Guangdong Office and Economic and Trading Committee of Guangdong Province. The forth board meeting had passed self-check report and submitted it to CSRC Guangdong Office and Economic and Trading Committee of Guangdong Province timely. The report was graded as excellent in the Self-check Result Summarizing Meeting held by CSRC Guangdong Office and Economic and Trading Committee of Guangdong Province. Based on the requirement of Instruction on Setting-up of Independent Director System in Listing Companies, on 15 May 2002, the 2001 annual general meeting had elected Mr. Wang Jun, Mr. Zhang Zhiyue, Mr. Song Xianzhong, Ms. Cheng Xinxin and Mr. Zhu Baohe as the independent directors; and Mr. Xin Huanpin and Mr. Liang Ruyu as the independent supervisors, which achieved the target raised by the Guangdong Province Government that the company should employ one third independent directors in board and two supervisor in supervisory committee. The Company had set five specific committees and the relevant regulations for them. They are Strategy Development Committee, Budget Committee, Audit Committee, Nomination Committee and Employee Remunerations Assessment Committee. Independent directors were appointed as the chief delegate of Audit Committee, Nomination Committee and Remunerations and Assessment Committee. 2. Information about independent directors and supervisors According to the related rules and Articles of Association of the Company, the independent directors and supervisors carried out their responsibility and right seriously and kept a close eye on the operation and production situation of the company. They attended the board meetings and shareholders meetings actively, and expressed opinions from their respective professional views to protect the interests of shareholders. 3. Separation of operation with the holding company A. Separation of human resource: the General Manager and all his subordinates receive salaries from the Company. Except for the General Manager who is a director in the holding company, no other employees of the Company takes any position in the holding company. B. Separation of assets: the Company has independent production system, supporting system to production and ancillary facilities. The Company independently owns its intangible assets such as intellectual property rights, trademarks and Non-patent technology, except that the land use right certificate of Shajiao A Power Plant which is still in progress. C. Financial independence: the Company has an independent financial department and has established independent accounting system and financial management system. It opened independent bank accounts for its own operation. D. Separation of organization: the Company has established integrated operating institution of its own. - 10 - V. CORPORATION GOVERNANCE STRUCTURE (CONT’D) 3. Separation of operation with the holding company (cont’d) E. Separation of operation: after the reform of the power industry in Guangdong to separate power generation assets and power grid, the Company has established its own power sales channels. Attended by historical factors and considering that the concentrating purchase would better benefit the Company, the company has signed underwrite contracts with Guangdong Electric Industry Fuel owned by Yuedian, the shareholder. And the purchase price was market price. 4. The setting of the Company’s evaluation and encourage scheme and principles The Company is in the process of establishing a fair, visible performance evaluation scheme and encouragement principle for director, supervisor and management personnel. The management personnel is appointed openly and fairly and compliant with laws and regulations. VI. GENERAL SHAREHOLDERS MEETING 1. 2001 Annual General Shareholders Meeting On April 10, 2002, notice on convening the meeting was published on Securities Times, China Securities, Shanghai Securities and Hong Kong Commercial. The company convened its 2001 Annual General Shareholders Meeting on the morning of May 15, 2002 at the Conference Room on the Fifth Floor of Guangzhou Dongfengzhong road No. 509 JianYin Building. 27 shareholders (or proxy of shareholders) attended the meeting, representing 1,567,148,658 shares, which is equivalent to 58.93% of the total shares of 2,659,404,000 shares. Among the shareholders, there were 13 A share shareholders, representing 1,561,929,844 shares and 14 B shareholders, representing 5,218,814 shares. Convening of the meeting comply with the Company Law and Articles of Association of the Company. Following resolutions were voted and passed at the meeting: (1) Reviewed and approved the 2001 Report of the Board of directors; (2) Reviewed and approved the 2001 Report of the General Manager; (3) Reviewed and approved the 2001 Report of the Final Accounts of Financial; (4) Reviewed and approved the 2001 Proposal of profit distribution; (5) Reviewed and approved the 2001 Report of the Supervisory Committee; (6) Reviewed and approved the 2001 Annual Report; (7) Reviewed and approved the Proposal for Making Up Housing Fund with Statutory Public Welfare Fund; (8) Reviewed and approved the Proposal for Appointment Auditors; (9) Reviewed and approved the Proposal for Amendments to Articles of Association; (10) Reviewed and approved the Rules for Meeting Procedures of General Shareholders’ Meetings; (11) Reviewed and approved the Proposal for Election of the Fourth Board of Directors; (12) Reviewed and approved the Proposal for Election of the Fourth Supervisory Committee; (13) Reviewed and approved the Proposal proposed by Yuedian, a shareholder who has 50.15% of the Company’s voting shares for bidding for 35.23% equity interest in Shajiao B Power Plant (For the execution of such proposal, please refer to Part VII Report of Directors 3.4); (14) Reviewed and approved the Proposal proposed by Yuedian,a shareholder who has 50.15% of the Company’s voting shares, on Allowance for Independent Directors and Independent Supervisors. - 11 - VI. GENERAL SHAREHOLDERS MEETING (CONT’D) 2. The First Extraordinary General Shareholders Meeting of 2002 The Company published the announcement for convening this meeting in the Securities Times, China Securities, Shanghai Securities and Hong Kong Commercial on May 28, 2002. The company convened its first Extraordinary General Shareholders Meeting for 2002 on the morning of June 15, 2002 at the Conference Room on the Fifth Floor of Guangzhou Dongfengzhong road NO. 509 JianYin Building. 28 shareholders (or proxy of shareholders) attended the meeting, representing 1,561,314,833 shares, which is equivalent to 58.71% of the total shares of 2,659,404,000 shares. Among the shareholders, there were 6 A share shareholders, representing 1,550,538,200 shares and 22 B shareholders, representing 10,776,633 shares. Convening of the meeting comply with the company Law and Articles of Association of the Company. Following resolutions were passed at the meeting: 1) Discussed and approved the Proposal of Acquisition of Seven Hydroelectricity Plants and Maintenance Center; 2) Discussed and approved the Proposal of Bank Loan; [For execution situation of the resolution please refer to Note 3(5) of Section 7 “Report of directors”] 3. The Second Extraordinary General Shareholders Meeting On 2 November, the Company published the announcement for convening this meeting in the Securities Times, China Securities, Shanghai Securities and Hong Kong Commercial. The Company convened its Second Extraordinary General Shareholders’ Meeting of 2002 on November 30, 2002 at the conference room on the fifth floor, Jian Yin Building, 509 Dong Feng Zhong Road in Guangzhou. 13 shareholders (or proxy of shareholders) attended the meeting, representing 1,552,074,388 shares, which was equivalent to 58.36 % of the total 2,659,404,000 shares. Among them, there were 4 A share shareholders, representing 1,550,507,400 shares and 9 B share shareholders, representing 1,566,988 shares. Convening of the meeting complied with Company Law of the People’s Republic of China and Articles of Association of the Company. The following resolution was voted and passed during the meeting: Discussed and approved the Proposal for the Company’s Investment in Huizhou LNG Power Plant. The Resolutions passed in the 2001 General Shareholders meeting, the First Extraordinary General Shareholders meeting and the Second Extraordinary General Shareholders meeting were published in the Securities Times, China Securities, Shanghai Securities and Hong Kong Commercial on May 16, June 28 and December 3, 2002 respectively. - 12 - VII. REPORT OF DIRECTORS 1. The scope and review of the Company’s operations The Company is a large power generation company principally engaged in operation and construction of power plants and electric power transmission project. At the end of 2002, the Group’s installed generation capacity and electricity generation volume was 2,950MW, 9% of the total installed generation capacity of Guangdong Province, installed generation capacity attributable to the company was 2,477MW. The total generation volume of the Group amounted to 16.706 billion KWH, and on-grid volume totaled 15.529 billion KWH, increased by 10.47% and 10.40% respectively as compared to those of last year. The total generation volume of the Group accounted for 10.47% of that in Guangdong Province. The Group has achieved sales of approximately RMB5.587 billion, gross profit of approximately RMB2.079 billion, and operation profit of approximately RMB1.977 billion. The net profit, after deduction of minority interests, is approximately RMB1.180 billion, 12.16% more than that of last year. In 2002, Shajiao A Power Plant, the Company's wholly-owned plant, achieved electricity generation volume of 7,701 million KWH and on-grid electricity generation volume of 7,188 million KWH, increased by 4.56% and 4.77% respectively as compared to those of last year’s respectively. Zhanjiang Electric Power Co., Ltd. (“Zhanjiang Electric”), a 76% held subsidiary with a registered capital of RMB2.875 billion, is mainly engaged in power generation and construction of power plant and it has contributed a net profit of RMB 596,679,906 . The Zhanjiang Power Plant owned by Zhanjiang Electric has achieved power generation of 5,946 million KWH and on-grid electricity of 5,568 million KWH, increased by 9.06% and 9.02% respectively compared to those of last year. Guangdong Yuejia Electric Power Co., Ltd. (“Yuejia Electric”), a 68% held subsidiary, with a registered capital of RMB 1 billion, achieved power generation volume of 1,517 million KWH and on-grid electricity volume of 1,392 million KWH, increased by 0.40% and 0.55% respectively as compared with those of last year. Guangdong Yuejia Electric Power Co., Ltd. has contributed a net profit of RMB232,362,386. Shaoguan Yuejiang Electric Power Co., Ltd. (“Yuejiang Electric”), a 65% held subsidiary with a registered capital of RMB450 million, was mainly engaged in power generation. It contributed a net profit of approximately RMB 78,088,446. The No.10 generator managed by Yuejiang Electric has already been put into operation, achieving electricity generation volume of 1,542 million KWH and on-grid electricity volume of 1,381 million KWH, increased by 93.96% and 93.68% respectively as compared with those of last year. 2. Major suppliers and customer In 2002, all the electricity of the Group were sold to Guangdong Guangdian Group Co., Ltd. Fuels were purchased from Guangdong Electric Power Fuel Supply Co., Ltd. and Shaoguan Electric Power Plant, both being subsidiaries of the Yuedian. Total purchase of fuel for 2002 amounted to RMB1.956 billion. - 13 - VII. REPORT OF DIRECTORS (CONT’D) 3. Investments (1) There is no usage of the proceeds raised during the reporting period; (2) There is no proceeds raised but not used up by the Company; (3) Investment status of project funded by capital other than proceed of previous fund: Guangdong Maoming Ruineng Thermal Power Co., Ltd. (“Maoming Ruineng”), a 51% held subsidiary of the Company’s construction for its No.5 (200MW) generator was being conducted as planned. Registered capital of Maoming Ruineng is RMB217,157,500 and the total investment of the project is expected at RMB870,000,000. (4) The Company has ever obtained the extraordinary general shareholder meeting’s authorization of “Attendance in the bidding for 35.23% equity interests of the Shajiao B Power Plant” during the reporting period. The Company could not obtain the above equity interests because that the bidding price had exceeded the authorized ceiling of the purchase price. (5) The Company’s extraordinary general shareholder meeting has ever approved to acquire seven hydroelectric power plants and maintenance centers including Xinfenjiang Hydroelectric Power Plant with RMB 1.657 billion, and undertake all relevant liabilities amounting to 0.304 billion. But the Guangdong Province People’s Government did not approve the acquisition for certain reason, the acquisition was stopped as a result. 4. Financial highlights of the Group 31 December 2002 31 December 2001 Increase / decrease +/(-) Items RMB'000 RMB'000 RMB'000 Total Asset 11,872,866 12,416,341 (543,475) Long-term Liabilities 1,578,500 1,806,500 (228,000 ) Shareholder Equity 7,397,470 6,802,793 594,677 Profit from selling 2,079,422 2,227,775 (148,353) electricity Net profit 1,179,746 1,051,805 127,941 Explanations of the movements of the above and other outstanding items: (1) Total asset decreased by RMB 543,475K, which was mainly due to the decrease of minority interests after the acquisition of additional equity interests of Zhanjiang Electric and Yuejia Electric and the decrease of the payables; (2) Long-term liabilities decreased by 228,000K, which was mainly due to the repayment of long-term bank loans; (3) Shareholder equity increased by RMB 594,677,000, which was mainly because of the increase of net profit. (4) Profit from selling electricity decreased by RMB 148,353,000, which was mainly due to the Group on-grid power prices of the subsidiaries of the Group has been adjusted down since Jul.1, 2002. (5) Net profit increased by RMB1.27941 billion mainly due to the subsidiaries of the Group has increased the generation volume, and the Company increased its equity interests in Zhanjiang Electric and Yuejia Electric. - 14 - VII. REPORT OF DIRECTORS (CONT’D) 5. Impacts of the significant changes in external environment, government policies and regulations With the further restructuring of the electricity system, pursuant to State Planning Committee’s Notice of Regulating Electricity Price Governance([Ji Price[2001] No. 701], the Guangdong Province had adjusted the pricing policy of the power plant’s on-grid electricity from 1 July 2002 on. Electricity prices of the Company’s subsidiaries have been adjusted down in the second half year of 2002 as a result. The Company faced more operation pressure as a result. The Company does not anticipate material adjustments on the electricity prices of the Group’s power plants in 2003 as compared with the electricity prices of the second half of 2002. 6. Work plan for year 2003 (1) Subsidiaries’ production plan The planned generation volume of the Company's subsidiaries for year 2003 is 175,060 million KWH, an increase of 10.70% as compared to the plan of prior year (158,160 million KWH). The total generation plan included: Shajiao A Plant: 7,582 million KWH, Zhanjiang Electric: 6,252 million KWH, Meixian B Power Plant: Shaoguan #10 generator: 1,545 million KWH, Maoming Ruineng: 706 million KWH; (2) To strengthen the management on the subsidiaries’ operation and safety production; to raise the improve the load factor and equivalent availability factor of generators, and try to decrease the scheduled shut down factor and unscheduled shut down factor, to ensure the generators to produce continuously, safely and stablely ; and to perform budget and cost control; (3) To put the Maoming Reineng #5 generator into trial production in the second quarter of 2003; (4) To proceed the acquisition of the Guangdong Province Shajiao C Power Plant; (5) To construct the Meixian #5 generator and Shaoguan #11 generator; (6) To take active involvement in the constructions of the Huizhou LNG (Phrase I 3 350 MW, of which the Company accounts for 35% of the equity interests), Guizhou Pannan Power Plant (Phrase I, 2 600MW, of which the Company accounts for 14.3% percent of the equity interests), Shanwei Power Plant (Phrase I, 2 600MW, of which the Company accounts for 20% percent of the equity interests). 7. Work performed by the Board of Directors (1) Meetings of the Board of Directors and Shareholders Seven meetings of the Board of Directors were held on April 3, April 23, May 15, May 27, June 28, August 16, and October 28, 2002 respectively. They were the 11th to 12th of the Third Board of Directors and 1st to 5th of the Fourth Board of Directors. Three General Shareholders Meetings were held. They were the Annual General Shareholders Meeting of 2001 on May 15, 2002, the First and Second Extraordinary General Shareholders Meeting of 2002 on June 28, Nov 30, 2002. The Directors make decisions for major issues of the Company through review and discussion of relevant proposals raised by the Company. - 15 - VII. REPORT OF DIRECTORS (CONT’D) 7. Work performed by the Board of Directors (Cont’d) (2) Major resolutions passed by the Board of Directors a) Reviewed and approved reports and proposals such as the 2001, the First Quarter, Interim, the Third Quarter of 2002’s Report of the General Manager; Report of the Final Accounts of Financial; Proposal for Profit Appropriation and Dividends Distribution; Annual, Interim, Quarterly Report and its extract; Proposal for Election of the Fourth Supervisory Committee; Proposal for Amendments to Articles of Association; Proposal for the allowance of the independent directors and the independent supervisors etc. b) Other significant resolutions of the Company Reviewed and approved the Proposal for Company’s attendance in the bidding for 35.23% of Shajiao B Plant’s equity interests; Proposal for acquisition of seven hydroelectric plants and hydroelectric maintenance centers and loans from the bank for the acquisition, Proposal for the Company’s investment on Huizhou LNG Power Plant and Shaoguan Power Plant’s No.11 generator and other proposals. c) Implement the resolution of the general shareholder’s meeting, and properly disclosed the Company’s information In 2002, according to the Company Law and Articles of Association of the Company, the Board of Directors disclosed the above major items of the Company timely, truely and fully, according to the principles of “Fairness, Justice, and Openness”. As a result, all investors have been enabled to better understand of the Company’s operations. The Company has built up an honest, reliable image in the market. CSRC Guangdong Office and Economic and Trading Committee of Guangdong Province’s and other officials praised the Company many times during year. The Company was honored one of the Best Listed Companies in terms of information disclosure for year 2002 by Shenzhen Stock Exchange. 8. Proposed Profit Appropriation and Dividends Distribution Plan of 2002 According to the operation result of 2002, the Board of Directors proposed following Profit Appropriation and Dividends Distribution Plan of 2002: (1) The Company will set aside 10% of the net profit amounting to approximately RMB 1,189.985 million to statutory surplus reserve totaling approximately RMB 118.999 million; 25% totaling approximately RMB 297.4963 million to discretionary surplus reserve and 5% totaling approximately RMB 59.4993 million to statutory public welfare fund. (2) Profit available for distribution to shareholders totals approximately RMB713.991 million. In addition, the retained profit brought forward of approximately RMB95.17 million added the total distributable profit for 2002 to approximately 809.161 million. Directors of the Company proposed the following plan for dividends: RMB 0.23(tax inclusive) per share for A shares and RMB0.23 per share for B shares. Chairman of the Company: Pan Li - 16 - VIII. REPORT OF THE SUPERVISORY COMMITTEE 1. Summary of the Supervisory Committee’s work done. a) Meetings held in 2002: In 2002, the Supervisors attended seven meetings of the Board of Directors and the annual and two extraordinary general shareholders meetings in 2002. In addition, five Supervisory Committee meetings were held in 2002. Details are as follows: The Supervisory Committee convened its first meeting of year 2002 on April 3, 2002 at the Country Garden of Shunde. The meeting has passed the following resolutions: The Supervisor Committee’s Annual Working Report of 2001; the Company’s Annual Report and Annual Report Summary of 2001; the Recommendation of the Supervisory Competitors of the Fourth Supervisory Committee. The Supervisory Committee convened its second meeting of year 2002 on May 15, 2002 in Guangzhou. The new supervisors elected Mr. Yang Xuanxing as chairman of the Supervisory Committee and agreed to appoint Mr. Chen Jinliang as secretary to the Supervisory Committee. The Supervisory Committee held its third meeting of year 2002 on May 27, 2002 in Guangzhou. The supervisors discussed the Proposal for Acquisition of Seven Hydroelectric Plants and Hydroelectric Maintenance Centers raised by the Board of Directors: The Supervisory Committee convened its forth meeting of year 2002 on August 15, 2002 in Dongguan. The supervisors reviewed and approved the Interim Report for 2002 and the Extracts of Interim Report for 2002. The Supervisory Committee convened its fifth meeting of year 2002 on October 28, 2002 in Guangzhou. The supervisors discussed the Proposal for the Company’s Investment in Huizhou LNG Power Plant. The Supervisors have assessed and monitored the operation of the Company during all the above meetings and considered the operation of the Company was sound and compliant with laws and regulations. 2. Independent supervisors’ work development In current year, according to the regulation of the Government of Guangdong Province [No. 2001 448], the new supervisory committee has elected two independent supervisors under the premise that the number of total supervisors remained unchanged. By doing so, it has achieved the target set by the Government of Guangdong Province one year earlier. The independent supervisors are responsible and have given many their opinions and suggestions in the supervisory meetings, the board meetings and the general shareholders meetings. The independent supervisors have taken an active part in the supervisory work for the Company’s operation, which have regulated the Company’s operation. 3. Enhanced the daily supervision and management by conducting the internal inspection and audit. Performed the directors and manager’s economic responsibility resign audit and taken active part in the daily meeting of the senior management. Performed the construction of the probity and the inspection of the Group’s power plants’ operation. Enhanced the restriction of the government power. - 17 - VIII. REPORT OF THE SUPERVISORY COMMITTEE (Cont’d) 4. Performance of the Directors and senior management personnel The Supervisors are of the opinion that the Company continues to operate prudently in 2002 and have achieved good operation results. The Supervisor’s Committee got throughout understanding and inspected the Company’s decision-making procedures by attending all the shareholders meeting, presenting on each Board meeting and the assessment of the proposals. The Supervisor’s Committee also reviewed and assessed the performing results of the resolutions passed by the shareholders meeting and the Board meeting. The Supervisors have not noted any illegal or improper activities by the Directors or senior management personnel. 5. Assessment on the Company’s operation and financial position In 2002, the Group’s total power generation volume amounted to 16,706 million KWH, 105.63% of the planned power generation 15,816 million KWH, an increase of 10.47% as compared to 15,123 million KWH of 2001; The Company has got a better operation result than year 2001 by increasing the generation volume and enhancing the budge and cost management, though the on-grid electricity price the subsidiaries has been adjusted down of. The Supervisory Committee approved the auditor’s reports with clean opinion issued by PricewaterhouseCoopers Zhong Tian CPAs Co., Ltd. According to the auditor’s report issued by PricewaterhouseCoopers Zhong Tian CPAs Co., Ltd., the Group’s total assets amounted to RMB11.873 billion, the total sales amounted to RMB5.587 billion. The net profit was RMB1.18 billion which increased by RMB 127,941,000 as compared to that of 2001. Earnings per share was RMB0.44 that increased 10% as compared with that of 2001. The Company has got a satisfactory operation result in current year. In the Supervisor Committees’ opinion, the Company’s making the bad debt provision of RMB22,852,700 for some of the receivables was in line with accounting principles, which would benefit the long-term development of the Company. The Company was suggested to prevent financial risks and enhance the collection of the receivables. 6. Work Plan for 2002 (1) To attend the general shareholders meeting actively and be present on Board meetings, convene the Supervisory meetings periodically and take part in the supervisory work for the Company’s operation in order to protect the interests of the shareholders; (2) According to the regulations of the CSRC, to further regulate the operation of the Supervisory Committee, and to execute the responsibility of the Supervisory Committee legally; (3) To arrange the supervisors to take part in the supervisory training convened by the related organizations to enhance their concept of legal responsibilities and improve their supervisory levels. (4) To perform field inspection to the power plants of the Group and enhance the supervisory on the execution of the regulations and policies; (5) To further enhance the daily supervisory work in connection with the inspection and internal audit. Provide the security and service for the Company’s reforming and development. Chairman of the Supervisory Committee : Yang Xuanxing - 18 - IX. SIGNIFICANT EVENTS 1. Significant litigation or arbitration The Company had no lawsuits and arbitrations during the reporting period. Three significant lawsuits which have been finalized in prior year are being implemented. Up to March 31, 2003, the Company has obtained three repayment amounted to RMB7,674,500K from the Liquidation Committee of Guangdong International Trust and Investment Company. 2. The Group has no acquisition, merger or asset reorganization in the reporting period. 3. Significant related party transactions (Please refer to note 25 of the consolidated financial statements) 4. Significant contracts and implementation. (1) The Company was not involved in trustee, sub-contract or lease with other Companies in the reporting period. (2) Significant guarantee event. The Company provide guarantee to its subsidiary, Zhanjiang Electric from 2002 to August, 2006. It is due to the Company’s acquisition of equity interest from Yuedian in 2002. Yuedian transferred the guarantee for bank loan of the Zhanjiang Electric, for its power plant’s construction, to the Company. As at December 31, 2002, the guaranteed balance was RMB740 million. (3) Commitment status of the Company or its shareholders with 5% or above of the Company’s shares Maoming Ruineng, a subsidiary of the Company, entered into a long-term loan contract with Shanghai Pudong Development Bank Guangzhou Branch for RMB0.65 billion. The Company issued a supporting letter for the loan and committed as follows: (1) unless written consent by the creditor, the Company shall maintain its 51% equity interest in Maoming Ruineng. Before the rescission day, the disposition of the relevant equity interests should be written consent by the creditor. (2) the Company was forbidden from equity set up or equity set up permission about its direct or indirect holding shares of Maoming Ruineng, or cause any mortgage, pledge, retain or other guarantee on the equity interests. (3) except for requirement by law or regulation, the Company was forbidden from modifying the articles of association of Maoming Ruineng without written consent by the creditor. On March 1, 2001, Guangdong Yuedian Investment Development Co., Ltd., Maoming Electric Power Development Co., Ltd., Maoming Ruineng and the Company entered into a financial support agreement with Shanghai Pudong Development Bank Guangzhou Branch. The Company committed to provide additional investment or other financing support to Maoming Ruineng under certain circumstances. 5. Appointment of auditors During the reporting period, the Company appointed Beijing Pan-China Certified Public Accountants and PricewaterhouseCoopers Zhong Tian CPAs Co., Ltd. (Arthur Andersen & Co before July 1, 2002) as its auditors. The Company paid RMB650,000 and RMB1,200,000 to Beijing Pan-China Certified Public Accountants and PricewaterhouseCoopers Zhong Tian CPAs Co., Ltd. respectively in 2002. 6. The Company did not change its name or abbreviation of shares in the year. - 19 - X. FINANCIAL STATEMENTS (1) Auditor’s report - 20 - PricewaterhouseCoopers Zhong Tian CPAs Co. , Ltd. 12th Floor, Shui On Plaza 333 Huai Hai Zhong Lu Shanghai 200021 People’s Republic of China Telephone +86 (21) 6386 3388 Facsimile +86 (21) 6386 3300 INTERNATIONAL AUDITORS’ REPORT TO THE SHAREHOLDERS OF GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. (Incorporated as a joint stock limited company in the People's Republic of China) We have audited the accompanying consolidated balance sheet of Guangdong Electric Power Development Co., Ltd. (the “Company”) and its subsidiaries (the “Group”) as of 31 December 2002 and the related consolidated income and cash flow statements for the year then ended. These financial statements set out on pages 22 to 50 are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statements presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the consolidated financial statements give a true and fair view of the financial position of the Group as of 31 December 2002, and of the results of its operations and its cash flows for the year then ended in accordance with International Financial Reporting Standards. PricewaterhouseCoopers Zhong Tian CPAs Co., Ltd. 3 April 2003 Business is undertaken in the registered name of 普 华 永 道 中 天 会 计 师 事 务 所 有 限 公 司 . GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES CONSOLIDATED INCOME STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2002 (All amounts in Rmb thousands, except for earnings per share data) Notes 2002 2001 Operating revenue, net 3 5,586,730 5,386,785 Operating costs: Fuel 25(a) (1,956,785) (1,684,955) Repair and maintenance (326,954) (304,223) Depreciation (673,492) (635,694) Staff costs 6 (289,366) (233,796) Administrative expenses (167,935) (205,419) Others (92,776) (94,923) Total operating costs (3,507,308) (3,159,010) Operating profit 2,079,422 2,227,775 Other income, net 19,147 27,144 Finance costs, net 4 (125,587) (147,313) Share of results of associates before tax 3,870 8,577 Profit before tax 5 1,976,852 2,116,183 Income tax expense 7 (557,648) (591,071) Profit after tax 1,419,204 1,525,112 Minority interests (239,458) (473,307) Net profit 1,179,746 1,051,805 Earnings per share - Basic 11 Rmb0.44 Rmb0.40 - Diluted 11 N/A N/A The notes on pages 26 to 50 form an integral part of these consolidated financial statements - 22 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUSBSIDIARIES CONSOLIDATED BALANCE SHEET AS OF 31 DECEMBER 2002 (All amounts in Rmb thousands) Notes 2002 2001 ASSETS Non-current assets Property, plant and equipment 12 7,435,992 7,427,123 Land use rights 13 309,611 283,539 Intangible assets 14 396,650 414,010 Investments in associates 15 23,760 24,719 Loans to associates 16 9,322 14,359 Available-for-sale investments 17 67,998 70,160 Deferred tax assets 18 11,990 11,990 Deferred staff costs 19 94,509 107,531 Long-term prepayment for coal purchase 25(b) 120,000 120,000 8,469,832 8,473,431 Current assets Materials and supplies 20 301,995 229,377 Trade receivables 506,779 929,967 Prepayments and other receivables 36,301 45,186 Prepayment for acquisition of additional equity interest in subsidiaries 25(c) - 550,000 Due from a related company 25(a) 21,413 - Short-term bank deposits 280,000 580,000 Cash and cash equivalents 24(b) 2,256,546 1,608,380 3,403,034 3,942,910 Total assets 11,872,866 12,416,341 EQUITY AND LIABILITIES Capital and reserves Share capital 22 2,659,404 2,659,404 Reserves 23 4,738,066 4,143,389 7,397,470 6,802,793 Minority interests 1,568,212 2,609,022 Non-current liabilities Borrowings 21 1,578,500 1,806,500 Current liabilities Trade payables 20,225 26,973 Borrowings 21 525,000 275,980 Taxes payable 269,682 429,436 Other payables and accruals 274,622 216,086 Due to related companies 25(a) 239,155 249,551 1,328,684 1,198,026 Total equity and liabilities 11,872,866 12,416,341 The notes on pages 26 to 50 form an integral part of these consolidated financial statements. - 23 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY FOR THE YEAR ENDED 31 DECEMBER 2002 (All amounts in Rmb thousands) Reserves Statutory Statutory surplus public welfare Discretionary Retained Notes Share capital Capital reserve reserve fund surplus reserve earnings Total Balances at 1 January 2001 2,575,404 473,320 476,028 204,675 776,672 649,933 5,156,032 Issue of new shares 84,000 940,800 - - - - 1,024,800 Issuance expenses - (31,280) - - - - (31,280) Donation of fixed assets - 347 - - - - 347 Transfer - - 30,658 (30,658) - - - Dividends relating to 2000 10 - - - - - (398,911) (398,911) Net profit - - - - - 1,051,805 1,051,805 Appropriation from retained earnings 23 - - 105,777 52,888 123,443 (282,108) - Balances at 1 January 2002 2,659,404 1,383,187 612,463 226,905 900,115 1,020,719 6,802,793 Dividends relating to 2001 10 - - - - - (585,069) (585,069) Net profit - - - - - 1,179,746 1,179,746 Appropriation from retained earnings 23 - - 118,999 59,499 264,442 (442,940) - Balances at 31 December 2002 2,659,404 1,383,187 731,462 286,404 1,164,557 1,172,456 7,397,470 The notes on pages 26 to 50 form an integral part of these consolidated financial statements. - 24 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2002 (All amounts in Rmb thousands) Notes 2002 2001 Cash flows from operating activities: Cash generated from operations 24(a) 3,253,660 2,291,139 Interest paid (125,587) (166,674) Income tax paid (557,046) (553,160) Net cash from operating activities 2,571,027 1,571,305 Cash flows from investing activities: Acquisition of additional equity interest in subsidiaries (522,568) - Prepayment for acquisition of a subsidiary - (550,000) Proceeds from disposal of property, plant and equipment 1,020 - Purchase of property, plant and equipment (611,600) (293,956) Purchase of intangible assets (218) - Purchase of land use rights (12,855) - Interest received 28,333 37,162 Increase in investment in associates - (3,600) Dividends received from associates 4,227 2,692 Dividends received from available-for-sale investments 5,944 - Receipt of repayment from loan to associates 5,037 4,500 Net cash used in investing activities (1,102,680) (803,202) Cash flows from financing activities: Proceeds from issuance of new shares - 1,024,800 Issuance expenses - (31,280) Proceeds from/(repayments of) borrowings 21,020 (637,520) Dividends paid (585,069) (432,614) Distribution to minority shareholders (278,189) (406,614) Contribution from minority shareholders 22,057 30,000 Net cash used in financing activities (820,181) (453,228) Net increase in cash and cash equivalents 648,166 314,875 Cash and cash equivalents at beginning of year 1,608,380 1,293,505 Cash and cash equivalents at end of year 24(b) 2,256,546 1,608,380 The notes on pages 26 to 50 form an integral part of these consolidated financial statements. - 25 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 1 General Information Guangdong Electric Power Development Co., Ltd. (the “Company”) is a joint stock limited company incorporated in the People’s Republic of China (the “PRC”) on 3 November 1992. The Company’s Renminbi (“Rmb”) Denominated Domestic Shares (“A Shares”) and Domestically Listed Foreign Shares (“B Shares”) were listed on the Shenzhen Stock Exchange on 26 November 1993 and 28 June 1995 respectively. In 2001, pursuant to the Approval on the Implementation Plan of Guangdong Province’s Reform of Power Industry Structure Relating to Restructuring of Generation and Transmission Assets, a document issued by Guangdong Provincial Government and referred to as Yue Fu Han [2001] No. 252, Guangdong Electric Power Holding Co. (“GPHC”), the former major shareholder of the Company, was split into two separate companies, namely, Guangdong Guangdian Group Co. Ltd. (“Guangdian”) and Guangdong Yuedian Assets Management Co. Ltd. (“Yuedian”). According to the Reply to Issues in the Restructuring of Provincial Power Companies Assets with a document number of Yue Cai Qi [2001] No. 247, the Company’s 50.15% equity interest formerly held by GPHC was transferred to Yuedian on 1 August 2001. As such, the directors of the Company considered Yuedian as the immediate and ultimate parent company. The Company and its subsidiaries (the “Group”) are principally engaged in the business of developing electric power plants in Guangdong Province, the PRC. The Company’s registered address is 10th Floor, Boli Commercial Center, Guangfa Garden, 498 Huanshi Dong Road, Guangzhou. As of 31 December 2002, the Company had the following subsidiaries, which were incorporated in the PRC as limited liability companies: Attributable Date of equity Principal Name of entity incorporation interest Paid-in capital activities Rmb Zhanjiang Electric Power Co., 21 November 1995 76% 2,875,440,000 Electricity Ltd (“Zhanjiang generation Electric”)(Note14) Guangdong Yuejia Electric 25 January 1996 68% 1,000,000,000 Electricity Power Co., Ltd (“Yuejia generation Electric”)(Note 14) Guangdong Shaoguan 16 September 1997 65% 450,000,000 Electricity Yuejiang Electric Power generation Co., Ltd (“Yuejiang Electric”) Maoming Ruineng Thermal 1 January 2001 51% 217,157,500 Electricity Power Co., Ltd (“Maoming generation Ruineng”) (under construction) - 26 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 2 Principal accounting policies The principal accounting policies adopted in the preparation of these consolidated financial statements are set out below: (a) Basis of preparation The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board. This basis of accounting differs from that used in the preparation of the statutory financial statements of the Company and its subsidiaries comprising the Group, which have been prepared in accordance with accounting principles and regulations as applicable in the PRC. Appropriate adjustments have been made to these financial statements to conform with IFRS but such adjustments are not incorporated in the Group’s statutory accounting records. The consolidated financial statements have been prepared under the historical cost convention. The preparation of financial statements in conformity with generally accepted accounting principles requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on management’s best knowledge of current event and actions, actual results ultimately may differ from those estimates. (b) Group accounting (1) Subsidiaries Subsidiaries, which are those entities in which the Group has an interest of more than one half of the voting rights or otherwise has power to govern the financial and operating policies are consolidated. Subsidiaries are consolidated from the date on which control is transferred to the Group and are no longer consolidated from the date that control ceases. The purchase method of accounting is used to account for the acquisition of subsidiaries. The cost of an acquisition is measured as the fair value of the assets given up, shares issued or liabilities undertaken at the date of acquisition plus costs directly attributable to the acquisition. The excess of the cost of acquisition over the fair value of the net assets of the subsidiary acquired is recorded as goodwill. Intercompany transactions, balances and unrealised gains on transactions between group companies are eliminated; unrealised losses are also eliminated unless cost cannot be recovered. Where necessary, accounting policies of subsidiaries have been changed to ensure consistency with the policies adopted by the Group. - 27 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 2 Principal accounting policies (Cont’d) (b) Group accounting (Cont’d) (2) Associates Investments in associates are accounted for by the equity method of accounting. Under this method the Company’s share of the post-acquisition profits or losses of associates is recognized in the income statement and its share of post-acquisition movements in reserves is recognized in reserves. The cumulative post-acquisition movements are adjusted against the cost of the investment. Associates are entities over which the Group generally has between 20% and 50% of the voting rights, or over which the Group has significant influence, but which it does not control. Unrealised gains on transactions between the Group and its associates are eliminated to the extent of the Group’s interest in the associates; unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. The Group’s investment in associates includes goodwill (net of accumulated amortization) on acquisition. When the Group’s share of losses in an associate equals or exceeds its interest in the associate, the Group does not recognize further losses, unless the Group has incurred obligations or made payments on behalf of the associates. Details of the Group’s associates are set out in Note 15. (c) Foreign currency translation The Group’s books and records are maintained in Rmb. Foreign currency transactions are accounted for at the exchange rates prevailing at the date of the transactions. Monetary assets and liabilities denominated in foreign currency at the balance sheet date are translated to Rmb at the exchange rate prevailing at the balance sheet date. Gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies are recognized in the income statement. - 28 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 2 Principal accounting policies (Cont’d) (d) Property, plant and equipment Property, plant and equipment are stated at historical cost less accumulated depreciation and accumulated impairment losses. Depreciation is calculated on the straight-line method to write off the cost of each asset to their residual values over their estimated useful lives as follows: Buildings 30 to 50 years Electric utility plants in service 8 to 20 years Motor vehicles and other non-generation equipment 8 to 20 years Construction-in-progress represents plant and properties under construction and machinery pending installation and is stated at cost. This includes cost of construction, site restoration costs, plant and equipment and other direct costs. Interest costs on borrowings to finance the construction of property, plant and equipment are capitalized, during the period of time that is required to complete and prepare the asset for its intended use. Other borrowing costs are expensed. Construction-in-progress is not depreciated until such time as the assets are completed and ready for their intended use. Where the carrying amount of an asset is greater than its estimated recoverable amount, it is written down immediately to its recoverable amount. Gains and losses on disposals are determined by comparing proceeds with carrying amount and are included in the income statement. Repairs and maintenance are charged to the income statement during the financial period in which they are incurred. The cost of major renovations is included in the carrying amount of the asset when it is probable that future economic benefits in excess of the originally assessed standard of performance of the existing asset will flow to the Group. Major renovations are depreciated over the remaining useful life of the related asset. (d) Land use rights Land use rights are stated at cost less accumulated amortization. Cost is determined at purchase price of the land use right paid to a government authority. Land use rights are amortized over their respective lease terms. - 29 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 2 Principal accounting policies (Cont’d) (e) Intangible assets (1) Goodwill Goodwill represents the excess of the cost of an acquisition over the fair value of the Group’s share of the net assets of the acquired subsidiary at the date of acquisition. Goodwill is amortised using the straight-line method over its estimated useful life of 10 years. Management determines the estimated useful life of goodwill based on its evaluation of the respective companies at the time of the acquisition, considering factors such as existing market share, potential growth and other factors inherent in the acquired companies. At each balance sheet date the Group assesses whether there is any indication of impairment. If such indications exist an analysis is performed to assess whether the carrying amount of goodwill is fully recoverable. A write down is made if the carrying amount exceeds the recoverable amount. (2) Other intangible assets Other intangible assets are measured initially at cost and are recognized if it is probable that the future economic benefits that are attributable to the asset will flow to the enterprise; and the cost of the asset can be measured reliably. After initial recognition, other intangible assets are measured at cost less accumulated amortization and any accumulated impairment losses. Other intangible assets are amortized on a straight-line basis over the best estimate of their useful lives of 5 to18 years. The amortization period and the amortization method are reviewed annually at each financial year end. (f) Impairment of long lived assets Property, plant and equipment and other non-current assets are reviewed for impairment losses whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the carrying amount of the asset exceeds its recoverable amount, which is the higher of an asset’s net selling price or value in use. For the purposes of assessing impairment, assets are grouped at the lowest level for which there are separately identifiable cash flows. - 30 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 2 Principal accounting policies (Cont’d) (g) Available-for-sale investments Available-for-sale investments are initially measured at cost, which is the fair value of the consideration given for them, including transaction costs. All purchases and sales of investments are recognized on the trade date. Available-for-sale investments that do not have a quoted market price in an active market and whose fair value cannot be reliably measured by alternative valuation methods are measured at cost. Carrying amounts of such investments are reviewed at each balance sheet date for impairment. (h) Materials and supplies Materials and supplies are stated at the lower of weighted average cost and net realizable value, and are expensed to fuel cost and repair and maintenance when used, or capitalized to fixed assets when installed, as appropriate. (i) Trade receivables Trade receivables are carried at original invoice amount less provision made for impairment of these receivables. A provision for impairment of trade receivables is established when there is an objective evidence that the Group will not be able to collect all amounts due according to the original terms of receivables. The amount of the provision is the difference between the carrying amount and the recoverable amount, being the present value of expected cash flows, discounted at the market rate of interest for similar borrowers. (j) Cash and cash equivalents Cash and cash equivalents are carried in the balance sheet at cost. For the purposes of the cash flow statement, cash and cash equivalents comprise cash on hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of 3 months or less. - 31 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 2 Principal accounting policies (Cont’d) (k) Income taxes The Company and its subsidiaries provide for income tax on the basis of their profits for financial reporting purposes, adjusted for income and expense items which are not assessable or deductible for income tax purposes. Taxation of the Company and its subsidiaries is based on the relevant tax laws and regulations applicable to enterprises established in the PRC. Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Currently enacted tax rates are used in the determination of deferred income tax. Deferred tax assets are recognized to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised. (l) Pension scheme Pursuant to PRC laws and regulations, contributions to the basic old age insurance for the Group’s local staff are to be made monthly to a government agency based on 17% to 25% of the standard salary set by the provincial government, of which 25% to 28% is borne by the Group and the remainder is borne by the staff. The government agency is responsible for the pension liabilities relating to such staff on their retirement. The Group accounts for these contributions on an accrual basis. (m) Revenue recognition Provided it is probable that the economic benefits associated with a transaction will flow to the Group and the revenue and costs, if applicable, can be measured reliably, revenue is recognized on the following bases: (1) Operating revenue Operating revenue represents amounts billed for electricity generated and sold, net of value added tax. It is recognized upon transmission of electricity. (2) Interest income Interest income from bank deposits is recognized on a time proportion basis that takes into account the principal outstanding and the effective rate over the period to maturity, when it is determined that such income will accrue to the Group. - 32 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 2 Principal accounting policies (Cont’d) (n) Dividends Dividends are recorded in the Group’s financial statements in the period in which they are approved by the Group’s shareholders. (o) Financial instruments Financial instruments carried on the balance sheet include cash and bank balances, interest in associates, available-for-sale investments, receivables, payables and borrowings. Interest in associates, available-for-sale investments and trade receivables are stated at their carrying amounts determined in accordance with notes 2(b), 2(h) and 2(j) respectively. Other financial assets and financial liabilities without a quoted market price in an active market are measured at cost subject to impairment review. 3 Operating revenue The electricity transmission and distribution of Guangdong Province, the PRC, were controlled and managed by GPHC, the former parent company of the company, before August 2001. The control was transferred to Guangdian after the restructuring of GPHC as described in Note 1 (the “Restructuring”). Guangdian (formerly GPHC) has a monopoly over the supply and distribution of electricity to end users in the Guangdong Province. As such, Guangdian is the sole customer of the electricity generated by the Group. The Group companies entered into power purchase agreements with GPHC prior to the Restructuring in August 2001. After the Restructuring, Guangdian has continued to execute the agreements under their present terms. The Group companies are expected to enter into new agreements with Guangdian to replace the existing agreements in the near future. Key provisions, amongst others, of the existing agreements for the Group companies are as follows: - The Company Guangdian (formerly GPHC) has agreed to purchase not less than 3,100 million KWH of electricity generated by the Shajiao Power Plant A of the Company per annum from 1 January 2001 to 31 December 2009. Electricity fees are to be paid before the 20th of the following month. A penalty of 0.05% per day of the amount overdue will be charged for late payments. - Zhanjiang Electric Guangdian (formerly GPHC) is to purchase all the electricity transmitted by Zhanjiang Electric. Electricity fees are to be paid before the 25th of the following month. - 33 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 3 Operating revenue (Cont’d) - Yuejia Electric Guangdian (formerly GPHC) has agreed to purchase, for each generator unit of Yuejia Electric, not less than 567 million KWH of electricity in the first year of operation and not less than 618 million KWH per annum in the subsequent years. Electricity fees are to be paid within 15 working days after receipt of electricity invoices and relevant bills. - Yuejiang Electric Guangdian (formerly GPHC) is to purchase all the electricity transmitted by Yuejiang Electric. Electricity fees are to be paid in 25 days after issuance of invoices. The electricity tariffs for the power plants of the Group companies are subject to the approval of the Bureau of Prices of Guangdong Province (“BPGP”). For the year ended 31 December 2002, the amount of the electricity purchased by Guangdian (formerly GPHC) from the power plants of the Group companies and the corresponding unit selling prices as approved by the BPGP were as follows: Electricity amount Unit electricity prices Million KWH Rmb per MWH 2002 2001 2002 2001 Before 1 Afte July 20 July 20 The Company - Shajiao Power Plant A (Phase I) 4,0 3 3 3 - Shajiao Power Plant A (Phase II) 3,1 2 3 3 Zhanjiang Electric 5,5 5 4 3 Yuejia Electric 1,3 1 4 3 Yuejiang Electric 1,3 4 3 4 Finance costs, net 2002 2001 Rmb’000 Rmb’000 Interest expenses - Bank borrowings 133,077 166,674 Less: interest capitalized in construction-in-progress (7,490 (19,361 125,587 147,313 - 34 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 5 Profit before tax The following items have been (credited)/charged in arriving at profit before tax: 2002 2001 Rmb’000 Rmb’000 Interest income from bank deposits (28,333) (37,162) Depreciation of property, plant and equipment 673,492 635,694 Loss on disposal of property, plant and equipment 16,606 13,749 Repairs and maintenance expenditure on property, plant and equipment 326,954 304,223 Amortization of intangible assets - Goodwill 10,432 7,141 - Other intangible assets 38,670 37,810 Amortization of deferred staff costs 13,022 12,945 Amortization of land use rights 15,138 5,614 (Reversal of provisions)/provisions for doubtful receivables (14,893) 5,735 Costs of fuel recognized as expense 1,956,785 1,684,955 6 Staff costs 2002 2001 Rmb’000 Rmb’000 Wages and salaries 208,161 195,849 Contribution to defined contribution pension plan 38,243 24,046 Other social securities costs 42,962 13,901 289,366 233,796 The average number of employees in 2002 was 3,178 (2001: 4,965). 7 Income tax expense 2002 2001 Rmb’000 Rmb’000 Current tax 557,046 588,739 Deferred tax - 725 Share of tax of associates 602 1,607 557,648 591,071 - 35 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 7 Income tax expense (Cont’d) A reconciliation of applicable tax rate is as follows: 2002 200 Rmb’000 Rmb’00 Profit before tax 1,976,852 2,116,183 Tax calculated at a statutory rate of 27% (2001: 27%) 533,750 571,369 Tax effect of expenses not deductible for tax purposes - Amortization of deferred staff costs 3,236 3,236 - Amortization of goodwill 3,582 1,950 Effect of different tax rates of subsidiaries and other effects 17,080 14,516 Tax charge 557,648 591,071 The income tax rates applicable to the Group companies are as follows: 2002 200 The Company 27 27 Zhanjiang Electric 33 33 Yuejia Electric 15 1 Yuejiang Electric 33 33 Maoming Ruineng 33 33 The Company’s subsidiary, Yuejia Electric, as a foreign investment enterprise, has been granted full exemption from income tax for two years starting from its first profit-making year and a 50% reduction for the next three years. 2002 was the fifth profit-making year of Yuejia Electric and therefore, the effective income tax rate applicable to the Yuejia Electric for the current year is 7.5% (2001:7.5%). 8 Housing scheme In accordance with the PRC housing reform regulations, the Company and its subsidiaries are required to make contributions to the State-sponsored housing fund at 8%-20% of the specific salaries of the employees. At the same time, the employees are required to make a contribution equal to the Company and its subsidiaries’ contributions out of their payroll. The employees are entitled to claim the entire sum of the fund under certain specified withdrawal circumstances. The Company and its subsidiaries have no further obligation for housing benefits beyond the above contributions made. For the year ended December 31, 2002, the Company and its subsidiaries contributed approximately Rmb13,650,000 (2001: Rmb13,393,000) to the fund. - 36 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 9 Retirement benefit obligation All staff of the Group are entitled to a pension equal to their basic salaries beginning at their retirement dates until death from a statutory pension scheme. A government agent is responsible for the pension liabilities relating to such retired staff. The Group’s responsibility is limited to the monthly contributions to the statutory pension scheme computed at 17% to 20% of total monthly salary. The amount of contributions made by the Group in 2002 was approximately Rmb38,243,000 (2001: Rmb24,046,000). The Group has no further obligation to the pension cost beyond its monthly contribution. 10 Dividends Dividends approved by the Company’s shareholders in the year ended 31 December 2002 were as follows: 2002 2001 Rmb’000 Rmb’000 Final dividends for prior year, paid of Rmb0.22 per share (2001: Rmb0.15 per share) 585,069 398,911 11 Earnings per share The calculation of basic earnings per share is based on the net profit for the year attributable to ordinary shareholders of approximately Rmb1,179,746,000 (2001: approximately Rmb1,051,805,000), divided by the weighted average number of ordinary shares outstanding during the year of 2,659,404,000 shares (2001: 2,638,404,000 shares). No diluted earnings per share were presented as there were no dilutive potential ordinary shares as of year end. - 37 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 12 Property, plant and equipment Motor vehicles and Electric other non utility plants -generation Construction- Buildings in service equipment in-progress Total Rmb’000 Rmb’000 Rmb’000 Rmb’000 Rmb’000 Year ended 31 December 2001 Opening net book amount 277,167 4,586,412 18,067 1,540,352 6,421,998 Transfer 90,178 1,596,107 1,615 (1,709,052) (21,152) Additions from acquisition of a subsidiary 6,729 1,445,200 14,853 11,267 1,478,049 Reclassification (197,096) 197,096 - - - Additions 612 20,797 12,754 374,977 409,140 Disposals (55,982) (143,713) (978) (24,545) (225,218) Depreciation charge (4,636) (620,879) (10,179) - (635,694) Closing net book amount 116,972 7,081,020 36,132 192,999 7,427,123 At 31 December 2001 Cost 158,234 9,705,167 66,908 192,999 10,123,308 Accumulated depreciation (41,262) (2,624,147) (30,776) - (2,696,185) Net book amount 116,972 7,081,020 36,132 192,999 7,427,123 Year ended 31 December 2002 Opening net book amount 116,972 7,081,020 36,132 192,999 7,427,123 Transfer 37,602 275,814 24,479 (337,895) - Additions 8,342 6,485 10,111 675,049 699,987 Disposals (985) (16,594) (47) - (17,626) Depreciation charge (6,119) (653,038) (14,335) - (673,492) Closing net book amount 155,812 6,693,687 56,340 530,153 7,435,992 At 31 December 2002 Cost 187,992 9,907,631 105,223 530,153 10,730,999 Accumulated depreciation (32,180) (3,213,944) (48,883) - (3,295,007) Net book amount 155,812 6,693,687 56,340 530,153 7,435,992 Certain electric utility plants with a net book value of approximately Rmb689,611,000 (2001: Nil) have been pledged to secure certain bank borrowings of the Group totalling Rmb397,000,000 (Note 21). Borrowing costs of approximately Rmb7,490,000 (2001: approximately Rmb19,361,000) were capitalized as construction-in-progress during the year. A capitalization rate of 5.76% (2001: 5.53%) per annum was used to determine the amount of borrowing costs eligible for capitalization. - 38 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 13 Land use rights 2002 2001 Rmb’000 Rmb’000 Year ended 31 December Opening net book amount 283,539 271,597 Additions 41,210 17,556 Amortization charge (15,138) (5,614) Closing net book amount 309,611 283,539 At 31 December Cost 370,018 328,808 Accumulated amortization (60,407) (45,269) Net book amount 309,611 283,539 14 Intangible assets Other intangible Goodwill assets Total Rmb’000 Rmb’000 Rmb’000 Year ended 31 December 2001 Opening net book amount 71,198 366,611 437,809 Additions - 21,152 21,152 Amortization charge (7,141) (37,810) (44,951) Closing net book amount 64,057 349,953 414,010 At 31 December 2001 Cost 72,785 460,012 532,797 Accumulated amortization (8,728) (110,059) (118,787) Net book amount 64,057 349,953 414,010 Year ended 31 December 2002 Opening net book amount 64,057 349,953 414,010 Additions 31,524 218 31,742 Amortization charge (10,432) (38,670) (49,102) Closing net book amount 85,149 311,501 396,650 At 31 December 2002 Cost 104,309 460,230 564,539 Accumulated amortization (19,160) (148,729) (167,889) Net book amount 85,149 311,501 396,650 - 39 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 14 Intangible assets (Cont’d) (a) Goodwill On 5 July 2000, the Company acquired 65% of the equity interest of Yuejiang Electric from GPHC at a cash consideration of Rmb365,285,000. The excess of the purchase price over the Company’s share of the fair value of net identifiable assets acquired of approximately Rmb72,785,000 has been recorded as goodwill. On 1 January 2002, the Company acquired additional 9% and 16% equity interests of Zhanjiang Electric from Yuedian and Guangdong Electric Power Development Company (“GEPD”), the third largest shareholder of the Company, for cash considerations of Rmb316,456,000 and Rmb562,588,000 respectively. On January 1, 2002, the Company acquired an additional 17% equity interest of Yuejia Electric from GEPD for a cash consideration of Rmb193,524,000. The excess of the purchase price over the Company’s share of the fair value of net identifiable assets acquired of approximately Rmb31,524,000 has been recorded as goodwill. Zhanjiang Electric Yuejia Electric Rmb’000 Rmb’000 Non-current assets 3,603,663 824,622 Current assets 1,339,241 506,807 Non-current liabilities (840,000) - Current liabilities (704,104) (205,876) Net assets 3,398,800 1,125,553 Percentage of net assets acquired 25% 17% Net assets acquired 849,700 191,344 Less: considerations (879,044) (193,524) 29,344 2,180 Goodwill 31,524 Goodwill is amortized on a straight-line basis over 10 years. - 40 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 14 Intangible assets (Cont’d) (b) Other intangible assets According to the respective joint venture contracts of Zhanjiang Electric and Yuejia Electric and with reference to prevailing government regulations and practices, certain of the electricity transmission facilities constructed by Zhanjiang Electric and Yuejia Electric were transferred to GPHC upon the completion of these facilities in 1999 at no cost. The costs of constructing these facilities incurred by Zhanjiang Electric and Yuejia Electric were capitalized as intangible assets and amortized on a straight line basis starting from 1999 over their expected useful lives of 10 years and 18 years respectively for Zhanjiang Electric and Yuejia Electric. In addition, according to the agreements signed between Yuejiang Electric, Yangcheng Railway Company and Transportation Bureau of Qujiang County, the railway and highway constructed by Yuejiang Electric were transferred to Yangcheng Railway Company and Transportation Bureau of Qujiang County respectively upon their completion in 2001 at no cost. The cost of the railway and highway incurred by Yuejiang Electric was capitalized as an intangible asset and amortized on a straight line basis starting from 2001 over their expected useful lives of 5 years. The directors of the Company consider it probable that the future economic benefits attributable to the above intangible assets will flow to the Group over their respective expected useful lives. (c) The directors of the Company are of the opinion that the underlying value of the intangible assets was not less than its carrying value as of 31 December 2002. 15 Investments in associates 2002 2001 Rmb’000 Rmb’000 At the beginning of year 24,719 16,841 Additions - 3,600 Share of results before tax 3,870 8,577 Share of tax (602) (1,607) Share of results after tax 3,268 6,970 Dividends (4,227) (2,692) At the end of year 23,760 24,719 - 41 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 15 Investments in associates (Cont’d) The principal associates, all of which are unlisted, are: Country of Percentage of equity Name incorporation Principal activities interest held Maoming Electric Power Water Supply PRC Water supply 15% Co., Ltd. (“Maoming Water”)* Yangshan Jiangkeng Hydroelectric Station PRC Electricity generation 25% Yangshan Zhongxinkeng Electric Power PRC Electricity generation 40% Co. Ltd. (“Zhongxinkeng”) Maoming Jieneng Shui Mei Jiang Co. Ltd. PRC Power plant dirt cleaning 30% * The Company has significant influence over Maoming Water. Therefore, it is considered as an associate of the Group. 16 Loans to associates Loans to associates consist of the following: 2002 2001 Rmb’000 Rmb’000 Loan to Maoming Water 3,300 7,500 Loan to Zhongxinkeng 6,022 6,859 9,322 14,359 Loan to Maoming Water is unsecured, bears interest at 10% (2001: 10%) per annum and has no fixed term of repayment. In 2002, Maoming Water repaid Rmb4,200,000 of the loan. Loan to Zhongxinkeng is unsecured, bears interest at 7.56% (2001: 7.56%) per annum and will mature in 2008. - 42 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 17 Available-for-sale investments 2002 2001 Rmb’000 Rmb’000 Non-current 67,998 70,160 Non-current available-for-sale investments comprise the following: 2002 2001 Rmb’000 Rmb’000 Investment in an unlisted company 52,500 52,500 Investment in a property - Jinyan Garden - 3,532 Investment in legal person shares of a listed company, at carrying value 15,498 14,128 67,998 70,160 The directors of the Company are of the opinion that no quoted market price in an active market is available for the above investments. In addition, fair value cannot be reliably measured by alternative valuation methods. In accordance with IFRS, the above non-current available-for-sale investments are carried at cost subject to impairment review. 18 Deferred tax assets Deferred tax assets consisted of the following: 2002 2001 Rmb’000 Rmb’000 Deferred tax assets: - Write-off of pre-operating expenses 10,143 6,485 - Provision for doubtful receivables 6,213 10,234 - Others (4,366) (4,729) Net deferred tax assets 11,990 11,990 Deferred tax expenses (income) recognized in the consolidated income statement consisted of the following: 2002 2001 Rmb’000 Rmb’000 Deferred tax expenses (income): - (Write-off) /amortization of pre-operating expenses (3,658) 1,296 - Reversal of provision/(provision for doubtful receivables) 4,021 (1,548) - Others (363) 977 - 725 - 43 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 19 Deferred staff costs 2002 2001 Rmb’000 Rmb’000 Year ended 31 December Opening net book amount 107,531 110,807 Additions - 9,669 Amortization charge (13,022) (12,945) Closing net book amount 94,509 107,531 At 31 December Cost 130,223 130,223 Accumulated amortization (35,714) (22,692) Net book amount 94,509 107,531 Deferred staff costs represent housing losses incurred as a result of selling staff quarters to employees at preferential prices. The losses are recorded as deferred staff costs and are amortized over the remaining average service life of the employees. 20 Materials and supplies 2002 2001 Rmb’000 Rmb’000 Coal 130,800 54,813 Oil 12,397 12,216 Spare parts and chemicals 158,798 162,348 301,995 229,377 21 Borrowings 2002 2001 Rmb’000 Rmb’000 Bank borrowings - Current 525,000 275,980 - Non-current 1,578,500 1,806,500 2,103,500 2,082,480 The borrowings include secured bank borrowings in a total amount of Rmb397,000,000 (2001:Nil) and guaranteed bank borrowings in a total amount of Rmb966,500,000 (2001:966,500,000). The secured bank borrowings are secured over certain electric utility plants of the Group amounting to approximately Rmb689,611,000 as of 31 December 2002 (Note 12). The guaranteed bank borrowings were originally guaranteed by GPHC. As of 31 December 2002, the Group is in the process of negotiation with the relevant bank to re- arrange the guarantee due to the Restructuring of GPHC (Note 1). - 44 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 21 Borrowings (Cont’d) The effective interest rates of the bank borrowings at 31 December 2002 were from 5.04% to 6.21% (2001: 6.21%). Maturity of non-current borrowings is as follows: 2002 2001 Rmb’000 Rmb’000 Between 1 and 2 years 351,000 365,000 Between 2 and 5 years 1,227,500 1,079,000 Over 5 years - 362,500 1,578,500 1,806,500 The Group has the following undrawn committed borrowing facilities: 2002 2001 Rmb’000 Rmb’000 Floating rate - Expiring within one year 151,000 - - Expiring beyond one year 10,202,000 - 10,353,000 - The facilities have been arranged to help finance the proposed expansion of the Group. 22 Share capital As of 31 December 2002, the authorized share capital of the Company was Rmb2,659,404,000 (2001: Rmb2,659,404,000) at Rmb1 per share and included both A Shares and B Shares. The B Shares ranked pari passu in all respects with the A Shares except that A Shares can only be owned and traded by investors in the Mainland China; while B Shares can be owned and traded in foreign currency by both domestic and foreign investors. Number of shares Share capital 2002 2001 2002 2001 Thousand Thousand shares shares Rmb’000 Rmb’000 Authorized, issued and fully paid: Yuedian (See Note 1) 1,333,800 1,333,800 1,333,800 1,333,800 Legal persons 268,788 268,788 268,788 268,788 A Shares 391,476 391,476 391,476 391,476 B Shares 665,340 665,340 665,340 665,340 2,659,404 2,659,404 2,659,404 2,659,404 - 45 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 23 Reserves According to the articles of association of the Company, when distributing the net profit of each year, the Company shall set aside 10% of its net profit after tax based on the Company’s local statutory accounts for the statutory surplus reserve fund (except where the reserve balance has reached 50% of the Company’s registered share capital), and for the statutory public welfare fund at a percentage from 5% to 10% determined by the directors. The Company may make appropriation from its profit to the discretionary surplus reserve provided it is approved by a resolution of a shareholders’ general meeting. These reserves cannot be used for purposes other than those for which they are created and are not distributable as cash dividends. Capital reserve includes share premium. When the statutory surplus reserve is not sufficient to make good for any losses of the Company from previous years, current year net profit shall be used to make good of the losses before allocations are set aside for the statutory surplus reserve or the statutory public welfare fund. The statutory public welfare fund is used to build or acquire capital items, such as dormitories and other facilities for the Company’s employees and cannot be used to pay for welfare expenses. Title of these capital items will remain with the Company. The statutory surplus reserve, the discretionary surplus reserve and the share premium may be converted into share capital provided it is approved by a resolution at a shareholders’ general meeting and the balance of the statutory surplus reserve does not fall below 25% of the registered share capital. The Company may either distribute new shares in proportion to the number of shares held by shareholders, or increase the par value of each share. For the year ended 31 December 2002, the directors proposed the following appropriations to statutory reserves: 2002 2001 Rmb’000 Rmb’000 Statutory surplus reserve 118,999 105,777 Statutory public welfare fund 59,499 52,888 Discretionary surplus reserve 264,442 123,443 442,940 282,108 According to the articles of association of the Company, the reserve available for distribution is the lower of the amount determined under the PRC accounting standards and the amount determined under IFRS. As of 31 December 2002, the reserve of the Company available for distribution determined in accordance with PRC accounting standards and IFRS were approximately Rmb197,498,000 (2001: approximately Rmb95,171,109) and Rmb1,172,456,000 (2001: approximately Rmb1,020,719,000), respectively. - 46 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 24 Cash generated from operations (a) Reconciliation from net profit to cash generated from operations: 2002 2001 Rmb’000 Rmb’000 Net profit 1,179,746 1,051,805 Adjustments for: Minority interests 239,458 473,307 Tax expense 557,648 591,071 Depreciation 673,492 635,694 (Reversal of provision)/provision for doubtful receivables (14,893) 5,735 Amortization of deferred staff costs 13,022 12,945 Amortization of intangible assets 49,102 44,951 Amortization for land use rights 15,138 5,614 Loss on disposal of property, plant and equipment 16,606 13,749 Interest income (28,333) (37,162) Dividend income (11,541) - Interest expense 125,587 147,313 Share of results of associates before tax (3,870) (8,577) Changes in working capital: Increase in materials and supplies (72,619) (121,478) Decrease/(increase) in short-term bank deposit 300,000 (300,000) Decrease/(increase) in trade receivables 425,314 (416,775) Decrease in prepayments and other receivables 21,651 35,957 (Decrease)/increase in trade payables (6,748) 12,506 Decrease in other payables and accruals (33,537) (248,823) (Decrease)/increase in taxes payable (159,754) 143,756 (Decrease)/increase in amount due from/to related companies (31,809) 249,551 Cash generated from operations 3,253,660 2,291,139 (b) Analysis of the balances of cash and cash equivalents: 2002 2001 Rmb’000 Rmb’000 Cash and bank deposits 2,256,546 1,608,380 - 47 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 25 Related party transactions Other than the information as disclosed elsewhere in the notes to the consolidated financial statements, the Group had carried out the following material related party transactions: (a) Purchase of fuel from related parties The Company and Zhanjiang Electric purchase fuel and other materials from Guangdong Electric Materials Supply Co.,Ltd. (“GEMS”), a subsidiary of Yuedian through the assistance of Yuedian. For the year ended 31 December 2002, purchase of fuel from GEMS amounted to approximately Rmb1,750,500,000 (2001: approximately Rmb1,466,751,000). Yuejiang Electric purchases fuel and other materials from Shaoguan Electric Power Plant (“Shaoguan Electric”), a subsidiary of Yuedian. For the year ended 31 December 2002, purchase of fuel and other raw materials from Shaoguan Electric amounted to approximately Rmb200,220,000 (2001: approximately Rmb110,919,000). In the opinion of the Company’s directors, purchase prices of the above transactions are determined on an arm’s length basis. Balances with the above related parties as of 31 December 2002 are as follows: 2002 2001 Rmb’000 Rmb’000 Amount due from Shaoguan Electric 21,413 - Amount due to Yuedian 239,155 - Amount due to GEMS - 97,041 Amount due to Shaoguan Electric - 152,510 239,155 249,551 The balances with the related parties are unsecured, interest-free and have no fixed terms of repayment. (b) Long-term prepayment for coal purchase The long-term prepayment for coal purchase, which amounted to Rmb120,000,000 as of 31 December 2002 (2001: Rmb120,000,000), represented a prepayment placed with Yuedian to purchase and store fossil fuel and spare parts on behalf of Shajiao Power Plant A of the Company. The prepayment is unsecured, non-interest bearing and long-term in nature. The directors consider that the prepayment is necessary for maintaining the proper operation of Shajiao Power Plant A. - 48 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 25 Related party transactions (Cont’d) (c) Acquisition of additional equity interest in subsidiaries. On 1 January 2002, the Company acquired additional 9% and 16% equity interest of Zhanjiang Electric from Yuedian and GEPD, the third largest shareholder of the Company, for cash considerations of Rmb316,456,000 and Rmb562,588,000 respectively. On January 1, 2002, the Company acquired an additional 17% equity interest of Yuejia Electric from GEPD for a cash consideration of Rmb193,524,000 (See Note 14) . (d) Directors’ remuneration In 2002 the total remuneration of directors was approximately Rmb1,306,000(2001: Rmb705,000). 26 Financial instruments The carrying amounts of the Group’s cash and cash equivalents, trade receivables, short-term bank deposits over three months and trade payable approximate their fair values because of the short maturity of these instruments. As of 31 December 2002, the estimated fair values of non-current borrowings including current portions were approximately Rmb2,103,500,000 (2001: Rmb2,082,480,000) based on current market interest rates for comparable instruments. As of the same date, the book value of these liabilities was approximately Rmb2,103,500,000 (2001: Rmb2,082,480,000). (a) Credit risk The carrying amount of cash and cash equivalents, trade receivables, short-term bank deposits and other current assets except for prepayments, represent the Group’s maximum exposure to credit risk in relation to financial assets. The majority of the Group’s trade receivables relate to sales of electricity to Guangdian. The Group performs ongoing credit evaluations of Guangdian’s financial condition. The directors of the Company do not expect Guangdian to fail to meet its obligations given Guangdian’s strong financial position. No other financial assets carry a significant exposure to credit risk. (b) Interest rate risk The interest rates and terms of repayment of the long-term borrowings are disclosed in Note 21. (c) Currency risk Substantially all of the revenue-generating operations of the Company and its subsidiaries are transacted in Rmb. - 49 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE YEAR ENDED 31 DECEMBER 2002 (Amounts expressed in Renminbi unless otherwise stated) 27 Capital commitments Capital expenditure contracted for at the balance sheet date but not recognized in the consolidated financial statements is as follows: 2002 2001 Rmb’000 Rmb’000 Investment in additional equity interest in subsidiaries - 522,567 Acquisition of property, plant and equipment 1,165,357 99,305 1,165,357 621,872 The capital commitments as of 31 December 2002 were mainly for the construction of the new electricity generators of the Group. 28 Post balance sheet event Pursuant to a board resolution on 3 April 2003, the directors recommended the payment of a final dividend of 0.23 per share, totaling Rmb611,663,000, and the appropriation of approximately Rmb297,496,000 to the discretionary surplus reserve, and that the retained earnings of approximately Rmb263,297,000 as of 31 December 2002 be carried forward. The recommended payment of the final dividend and appropriation to the discretionary surplus reserve had not been recorded in the consolidated financial statements as of 31 December 2002. 29 Segment information No segment information is presented as the Group operates in one single industry and one single segment. The Group operates within one geographic segment because its revenues are all generated in the Guangdong Province, the PRC and its assets are located in the Guangdong Province, the PRC. 30 Comparative figures Certain comparative figures have been reclassified to conform to the current year’s presentation. 31 Approval of financial statements The consolidated financial statements were approved by the Board of Directors on 3 April 2003. . - 50 - GUANGDONG ELECTRIC POWER DEVELOPMENT CO., LTD. AND SUBSIDIARIES SUPPLEMENTARY INFORMATION IFRS ADJUSTMENTS ON THE STATUTORY ACCOUNTS FOR THE YEAR ENDED 31 DECEMBER 2002 Consolidated profit attributable to the Group Consolidated net assets Rmb’000 Rmb’000 As per the statutory financial statements (audited by certified public accountants in the PRC) 1,189,985 6,630,638 Impact of IFRS adjustments: Write-off of pre-operating expenses (11,086) (11,086) Reversal of balance of accrued repair and maintenance expense 12,730 12,730 Housing loss in statutory financial statements - 130,224 Amortization of deferred staff costs (13,022) (35,714) Difference in amortization of land use rights - 61,886 Deferred tax - 11,990 Profit appropriation in statutory financial statements for 2002 final dividends declared in 2003 - 611,663 Others 1,139 (14,861) As restated after IFRS adjustments 1,179,746 7,397,470 - 51 - XI. DOCUMENTS AVAILABLE FOR INSPECTION 1. Financial statements manually signed and chopped by Authorized Representative, general manager and Accounting Manager; 2. Originals of the Auditors’ report and financial statements manually signed and chopped by the Certificated Public Accountants; 3. Originals of documents and announcement of the Company as disclosed in Securities Times, China Securities, Hong Kong Commercial (oversea Chinese and English) in the reporting period; 4. Originals of the English version of the Annual Report; The above documents are kept in the Company’s office and can be reviewed anytime (except public holiday, Saturday and Sunday) by the shareholders. The Board of Directors Guangdong Electric Power Development Co., Ltd. 8 April 2003 - 52 -