东沣B退(200160)帝贤Ｂ2003年年度报告摘要（英文版）

CHENGDE DIXIAN TEXTILE CO., LTD. 2003 ANNUAL REPORT SUMMARY §1. Important Notes 1.1 The Board of Directors of Chengde Dixian Textile Co., Ltd. (hereinafter referred to as the Company) and its directors individually and collectively accept responsibility for the correctness, accuracy and completeness of the contents of this report and confirm that there are no material omissions or errors which would render any statement misleading. The 2003 annual report summary is abstracted from the full text of annual report; the investors are suggested to read the full text of annual report to understand more details. 1.2 No directors stated that they couldn’t ensure the correctness, accuracy and completeness of the contents of the Annual Report or have objection for this report. 1.3 All directors of the Company attended the Board meeting. 1.4 PricewaterhouseCoopers Zhongtian Certified Public Accountants issued a standard unqualified Auditors’Report for the Company. 1.5 Chairman of the Board of the Company Mr. Wang Shuxian, Chief Financial Supervisor Mr. Zhang Jing and Person in Charge of Accounting Mr. Sun Li hereby confirm that the Financial Report of the Annual Report is true and complete. §2. Company Profile 2.1 Basic information Short form of the stock DIXIAN B Stock code 200160 Listed stock exchange Shenzhen Stock Exchange Registered address and office address Xiaban Town, Chengde County, Hebei Post code 067400 Internet web site of the Company http://www.dxtex.com E-mail of the Company dxgs-9@heinfo.net 2.2 Contact person and method Authorized representative in charge Secretary of the Board of Directors of securities affairs Name Chen Zhiguo Du Qingfeng Contact address Xiaban Town, Chengde County, Hebei Xiaban Town, Chengde County, Hebei Telephone (86)314-3115049, 3115048 (86)314-3115049, 3115048 Fax (86)314-3182013 (86)314-3182013 E-mail dxgs-9@heinfo.net dxgs-9@heinfo.net §3. Summary of Accounting Data and Financial Indexes 3.1 Major accounting data (Unit: RMB) 1 Increase/decrease 2003 2002 2001 over last year（％） Income from main operations 523,600,121.00 463,087,869.00 13.07% 290,282,998.00 Total profit 184,182,801.00 139,287,134.00 32.23% 80,578,455.00 Net profit 143,046,587.00 115,303,505.00 24.06% 66,095,520.00 Net profit after deducting 140,043,395.00 120,757,900.00 15.97% 66,115,697.00 non-recurring gains and losses Increase/decrease At the end of At the end of At the end of from the end of 2003 2002 2001 previous year（％） Total assets 2,311,111,177.00 1,839,661,136.00 25.63% 1,173,490,339.00 Shareholder’s equity 696,775,076.00 553,728,489.00 25.83% 441,936,984.00 (excluding minority interests) Net cash flows arising from 124,469,246.00 162,376,239.00 -23.35% 63,424,674.00 operating activities 3.2 Major financial indexes (Unit: RMB) Increase/decrease 2003 2002 2001 over last year（％） Earnings per share 0.33 0.32 3.52% 0.31 Earnings per share (calculated based on new share capital if the 0.33 - - - share capital was changed) Return on equity 20.53% 20.82% -1.39% 15.00% Return on equity as calculated based on net profit after deducting 20.10% 21.31% -5.68% 15.00% non-recurring gains and losses Net cash flows per share arising 0.28 0.44 -36.04% 0.29 from operating activities Increase/decrease At the end At the end At the end from the end of of 2003 of 2002 of 2001 previous year（％） Net assets per share 1.59 1.52 4.88% 2.06 Net assets per share after 1.58 1.51 4.50% 2.04 adjustment 3.3 Difference in net profit as audited by Chinese Accounting Standard (CAS) and International Accounting Standard (IAS) √Applicable □Inapplicable Unit: In RMB’0000 CAS IAS Net profit 14,304.66 14,304.66 Explanation on the difference There was no difference in net profit. 2 §4. Changes in Share Capital and Particulars about Shareholders 4.1 Statement of changes in share Unit: Share Before the Increase/decrease in this time (+, - ) After the change Bonus shares Subtotal change Ｉ． Unlisted Shares 1. Sponsors’shares 170,000,000 34,000,000 34,000,000 204,000,000 Including: State-owned shares 0 0 Domestic legal person’s shares 16,074,520 3,214,904 3,214,904 19,289,424 Foreign legal person’s shares 0 0 Others 153,925,480 30,785,096 30,785,096 184,710,576 2. Raised legal person’s shares 0 0 3. Inner employee’s share 0 0 4. Preference shares or others 0 0 Total unlisted shares 170,000,000 34,000,000 34,000,000 204,000,000 Ⅱ. Listed Shares 1. RMB ordinary shares 0 0 2. Domestically listed foreign shares 195,500,000 39,100,000 39,100,000 234,600,000 3. Overseas listed foreign shares 0 0 4. Others 0 0 Total Listed shares 195,500,000 39,100,000 39,100,000 234,600,000 Ⅲ. Total shares 365,500,000 73,100,000 73,100,000 438,600,000 4.2 Statement of shares held by the top ten shareholders Total shareholders at the end of report year 12,453 Particulars about shares held by the top ten shareholders Increase / Number Nature of Holding decrease in Proportion Type of shares of share shareholders shares at the Full name of Shareholders the report in total (Circulating/non- pledged (State-owned year-end year (share) shares (%) circulating) or frozen shareholder or (share) (share) foreign shareholder) WANG SHU XIAN 28,934,000 173,604,000 39.58 Non-circulating 0 Natural person CHENGDE NORTH INDUSTRIAL 2,571,896 15,431,376 3.52 Domestic legal Non-circulating 0 CORPORATION person shareholder WANG ZHENG SONG 1,851,096 11,106,576 2.53 Non-circulating 0 Natural person RIPPERTON ASSETS LIMITED 4,952,818 7,084,388 1.62 Circulating Unknown Foreign shareholder CSSC INTL LTD 1,084,900 6,530,000 1.49 Circulating Unknown Foreign shareholder WANG WEN SHENG 6,048,339 6,048,339 1.38 Circulating Unknown Foreign shareholder CHINA MIDDLING & SMALL 862,450 5,880,000 1.34 Circulating Unknown Foreign shareholder ENTERPRISE DEVELOPMENT FUND CO., LTD. PERFECT SPACE INVESTMENTS 4,542,989 4,542,989 1.04 Circulating Unknown Foreign shareholder 3 GRANDLOYAL INVESTMEN LTD 267,200 4,200,000 0.96 Circulating Unknown Foreign shareholder MAIN FORCES ASSETS LIMITED -212,430 4,046,700 0.92 Circulating Unknown Foreign shareholder Explanation on associated relationship Among the top ten shareholders, the Company is unknown whether there exists among the top ten shareholders or associated relationship or belongs to the consistent actor regulated by the Management consistent action Measure of Information Disclosure on Change of Shareholding for Listed Company among the other shareholders except that WANG SHU XIAN and WANG ZHENG SONG are the relationship of father and son. Particulars about shares held by the top ten shareholders of circulating share Full name of Shareholders Holding circulating share at Type (A-share, B-share, the year-end (share) H-share or others) RIPPERTON ASSETS LIMITED 7,084,388 B-share CSSC INTL LTD 6,530,000 B-share WANG WEN SHENG 6,048,339 B-share CHINA MIDDLING & SMALL ENTERPRISE 5,880,000 B-share DEVELOPMENT FUND CO., LTD. PERFECT SPACE INVESTMENTS 4,542,989 B-share GRANDLOYAL INVESTMENT LTD 4,200,000 B-share MAIN FORCES ASSETS LIMITED 4,046,700 B-share GOOD CAPTURE INVESTMENTS 3,934,819 B-share CHINA SOUTHERN CORPORATE FINANCE 3,790,000 B-share LIMITED CSS (HK) L A/C ULTRAMATIC HOLDINGS 3,690,330 B-share LIMITED Explanation on associated relationship among The Company is unknown whether there exists the top ten shareholders of circulating share associated relationship among the top ten shareholders of circulating share. 4.3 Particulars about holding shareholders and actual controller of the Company 4.3.1 Particulars about change in controlling shareholders and actual controller of the Company □Applicable √Inapplicable 4.3.2 Introduction of especial situation for holding shareholder and other actual controller The holding shareholder of the Company is Wang Shuxian; and also is the first largest shareholder of the Company as well as actual controller of the Company. His information is as follows: Mr. Wang Shuxian, 50, Chinese nationality, who has not enjoy the residence power in the other country or area. He is one of the sponsors of the Company and holds 173,604,000 shares of the Company at present. Mr. Wang Shuxian is founder of the Company. In 1986, Xiaban County Knitting Factory was founded in Xiaban town of Chengde, Hebei. Over ten years, the Company has developed into the largest base of manufacture and exporter of textile in North China from small to large. In 1994, he has established Hebei Dixian Textile Group Co., and it has been changed into 4 joint-stock company on Nov. 3, 1999. Approved by CSRC, DIXIAN B successfully listed with Shenzhen Stock Exchange for trade on Sep. 29, 2000. The Company has become the first B-share listed company controlled by person. Now, Mr. Wang Shuxian is Chairman of the Board of the Company. 5. Particulars about the Directors, Supervisors and Senior Executives 5.1 Particulars about changes in shares held by directors, supervisors and senior executives Holding Holding Reason of Name Title Gender Age Office term shares at the shares at the change year-begin year-end Chairman of the Oct. 29, 2002- Bonus Wang Shuxian Male 50 144,670,000 173,604,000 Board Oct. 29, 2005 share Director, Oct. 29, 2002- Shi Bainian Male 32 0 0 General Manager Oct. 29, 2005 Oct. 29, 2002- Song Yushan Director Male 63 0 0 Oct. 29, 2005 Director, Deputy Oct. 29, 2002- Wang Huilai Male 49 0 0 General Manager Oct. 29, 2005 Oct. 29, 2002- Du Qingfeng Director Male 42 0 0 Oct. 29, 2005 Director, Deputy Oct. 29, 2002- Lan Wenzhi Female 45 0 0 General Manager Oct. 29, 2005 Independent Oct. 29, 2002- Wang Enyuan Male 62 0 0 director Oct. 29, 2005 Independent Oct. 29, 2002- Li Wei Male 33 0 0 director Oct. 29, 2005 Independent Oct. 29, 2002- Wang Yaguang Male 51 0 0 director Oct. 29, 2005 Wang Deputy General Oct. 29, 2002- Bonus Male 27 9,255,480 11,106,576 Zhengsong Manager Oct. 29, 2005 share Oct. 29, 2002- Song Kuiwu Supervisor Male 63 0 0 Oct. 29, 2005 Oct. 29, 2002- Yao Fenglan Supervisor Female 38 0 0 Oct. 29, 2005 Male Oct. 29, 2002- Xu Huafeng Supervisor 31 0 0 Oct. 29, 2005 CFO Male Oct. 29, 2002- Zhang Jing 33 0 0 Oct. 29, 2005 Secretary of Board Male Oct. 29, 2002- Chen Zhiguo 31 0 0 of Directors Oct. 29, 2005 Male Oct. 29, 2002- Li Xianfu Supervisor 58 0 0 Oct. 29, 2005 5 Oct. 29, 2002 Sun Zhenyu Supervisor Male 41 0 0 Oct. 29, 2005 5.2 Particulars about directors, supervisors holding the position in Shareholding Company √Applicable □Non-applicable Drawing the payment from Name of Shareholding Title in Shareholding Name Office term the Shareholding Company Company Company (Yes / No) Chengde North Industrial Song Yushan Legal Representative From 1999 to now No Corporation Chengde Dragon and Phoenix Song Yushan Legal Representative From 2002 to now No Dressing Co. Chengde Xiaban Town Song Yushan Legal Representative From 1999 to now No Hongxing Plastic Factory 5.3 Particulars about the annual payment of directors, supervisors and senior executives Total annual payment RMB 548,000 Total annual payment of the top three directors drawing RMB 191,000 the highest payment Total annual payment of the top three senior executives RMB 138,000 drawing the highest payment Allowance of independent director RMB 20,000 per person/ year Other treatment of Independent Directors The Company reimbursed the reasonable charges according to the actual situation which independent directors attended the meeting of the Board, shareholders’general meeting or exercise their functions and powers in accordance with the relevant laws and regulations and Articles of Association. Name of directors and supervisors received no payment None or allowance from the Company Payment Number of persons Over RMB 50,000 2 RMB 40,000 ～ RMB 50,000 5 RMB 10,000 ～ RMB 30,000 10 §6. Report of the Board of Directors 6.1 Discussion and analysis to the whole operation in the report period In the report period, the Company’ s production and operation was normal. Moreover, the Company kept a good development trend and saw a steady increase in the achievements. In 2003, the income from main operations was RMB 523,600,121, an increase of 13% compared with the corresponding period of the previous year. The profit from main operations was RMB 225,116,053, an increase of 24.5% than that of 6 the corresponding period of the previous year and the net profit realized was RMB 143,046,587, and increase of 24% compared with the corresponding period of the previous year. The main reasons were: (1) In the report period, the Company reinforced interior management and cost control, mined the interior potential and got benefits through strengthening the management, which has gained obvious achievements. (2) Another part of spinning and synthetic silk equipments of the Company were put into production and operation with growing output and stable quality, thus the sales income and profit increased somewhat than those in the same period of last year. (3) In the report period, the Company’ s output in papermaking equipments increased obviously. The papermaking project realized sales income and net profit amounting to RMB 87,678,955 and RMB 22,617,028 respectively in 2003. In the report period, in order not to give up the scarce investment chance and in order to realize the Company’s long-term development and ensure the long-term interests of the shareholders, the Management of the Company decided to overcome provisional difficulties and conducted the construction of papermaking projects. The Company caught the development opportunity, invested large quantities of capital and conducted the construction of papermaking projects, which resulted that the Company’ s working capital took on negative temporarily. The practice testified that the decision of the Management was right. The Board of Directors of the Company thought that along with the gradual input into production and operation of the investment projects of the Company, the fast increase in main operations will bring large funds to the Company and the Company shall positively carry through the direct and indirect financing, try hard to improve the liability structure of the Company and arrange the plan of production and operation in a reasonable and effective way, thus the status in working capital shall be improved gradually. After the papermaking projects being put into production and operation completely and formally, it will impact relatively large influence on the Company’s financial status and productive and operative results. 6.2 Statement of main operations classified according to industries or products Unit: RMB’0000 Classified according to Income from Cost of main Gross Increase/decrease Increase/decreas Increase/decrease industries or products main operations profit in income from e in cost of main in gross profit ratio operations (RMB) ratio (%) main operations operations over over the last year (RMB) over the last year the last year (%) (%) (%) Garments 24,632.27 11,138.81 54.78 -0.20 -55.20 -0.92 manufacturing Cotton textile 18,994.96 12,413.00 34.65 9.50 -8.20 -12.62 Papermaking 8,732.78 6,296.59 27.90 104.10 89.50 -5.56 Including: related 4,055.00 2,012.00 50.38 0.00 transactions Knit wears 24,632.27 11,138.81 54.78 -0.20 -55.20 0.92 7 Spinning and synthetic 18,994.96 12,413.00 34.65 9.50 -8.20 12.62 silks Paper 8,732.78 6,296.59 27.90 104.10 89.50 5.56 Including: related 4,055.00 2,012.00 50.38 transactions Pricing rules for related Pricing according to the market price of product in the same kind transactions Necessity and durative Yufa Company, its main related party, is an important trade partner of the Company before becoming the of related transactions Company’s related party. 6.3 Particulars about main operations classified according to areas Unit: RMB’0000 Areas Income from main operations Increase/decrease in income from (RMB) main operations over the last year (%) Foreign sales 0.00 0.00 Asia 27,469.97 0.10 Domestic sales 0.00 0.00 North China 15,265.05 405.90 South China 8,605.04 -13.90 East China 713.08 -85.60 Northeast 306.89 -65.80 6.4 Particulars about the customers of purchase and sales Unit: RMB’0000 Total amount of purchase 14,214.00 Proportion in the total 38.00% of the top five suppliers amount of purchase Total amount of sales of the 21,580.00 Proportion in the total 41.00% top five sales customers amount of sales 6.5 Operation of share-holding companies (applicable to the situation where investment equity takes over 10% of its net profit) □Applicable √Inapplicable 6.6 Explanation on reasons of material changes in main operations and its structure □Applicable √Inapplicable 6.7 Explanation on reasons of material changes in profitability capability of main operations (gross profit ratio) than that in the last year □Applicable √Inapplicable 6.8 Analysis to reasons of material changes in operating results and profit structure compared with the previous year □Applicable √Inapplicable 8 Analysis to reasons of material changes in the whole financial position than that in the last year □Applicable √Inapplicable 6.9 Explanation on the past, current and future important effects of the material changes in production and operation environment, macro-policies and regulations on the Company’ s financial position and operating results □Applicable √Inapplicable 6.10 Completion of the profit estimation □Applicable √Inapplicable 6.11 Completion of the business plan □Applicable √Inapplicable 6.12 Application of the raised proceeds □Applicable √Inapplicable Particulars about the changed projects □Applicable √Inapplicable 6.13 Application of the proceeds not raised through shares offering (For details, please refer to 7.1 in this report) √Applicable □Inapplicable Unit: RMB’0000 Name of projects Amount of projects Progress of projects Earnings of projects Papermaking project 101,050.00 97% 2262 Spinning project 24,300.00 75% - Thermoelectricity plant project 2,000.00 80% - Total 127,350.00 - - 6.14 Explanation of the Board of Directors on the “Qualified Opinion”made by the Certified Public Accountants □Applicable √Inapplicable 6.15 Business plan as of the next year of the Board of Directors (If it has) √Applicable □Inapplicable 1. In 2004, the Company shall continue to reinforce interior management and cost control, dig interior potential and enhance the efficiency through improving the management in order to better return to the investors. 2. The Company shall try its best to increase the product export to Korea and Hong Kong while keeping and enlarging the product sales in Japan. The Company also shall actively expand the domestic market, establish sales network for national products, increase sale in domestic market and ensure the productive and sales connection of the Company’ s products. 3. The Company shall continue to speed up the construction of joint papermaking project, try its best to make papermaking equipments be under normal production and 9 operation and enhance its output and quality in order to create more economic benefits for the Company. Profit estimation of the next year (If it has) □Applicable √Inapplicable 6.16 The preplan on the profit distribution and capitalization of capital public reserve of the Board of Directors After being audited by PricewaterhouseCoopers Zhong Tian CPAs Co., Ltd. and PricewaterhouseCoopers Co., Ltd. according to Chinese Accounting System and International Accounting Principles respectively, the Company’ s net profit in 2003 was RMB 143,046,587. According to relevant provisions in Company Law of the P.R.C. and Articles of Association of the Company, after being appropriated 10% of statutory public reserve amounting to RMB 14,304,659 and being appropriated 5% of statutory public welfare amounting to RMB 7,152,330 and adding the remained profit from last year, the profit available for distribution to shareholders is RMB 149,462,984. Since the capital input for joint-stock papermaking project is relatively large, the Board of Directors decided not to distribute profit to shareholders nor convert capital public reserve into share capital in 2003 in order to consider the interests of both the development of the Company and all shareholders. This preplan should be reported to Shareholders’General Meeting for consideration. §7. Significant Events 7.1 Purchase of assets □Applicable √Inapplicable 7.2 Sales of assets □Applicable √Inapplicable 7.3 Significant guarantees √Applicable □Inapplicable Unit: RMB’0000 Date of happening Complete Guarantee for Name of guaranteed Amount of Term of (date of Type of guarantees Implementation related parties or objects guarantees guarantees agreement or not not (yes or no) signing) Guangdong Rieys 6,000.00 Joint responsibility Sept. 26, 2003 – (Group) Company Sept. 26, 2003 guarantee Sept. 26, 2004 No No Ltd. Chengde Industrial 12,000.00 Joint responsibility Apr. 1, 2003 – Apr. 1, 2003 No Yes Papermaking Co., Ltd. guarantee Apr. 1, 2004 Hebei Xiabancheng 4,000.00 Joint responsibility July 7, 2003 – July 7, 2003 No Yes Knit Wears Co., Ltd. guarantee July 7, 2004 Chengde Dixian 4,000.00 Joint responsibility July 7, 2003 – July 7, 2003 No Yes Fashion Co., Ltd. guarantee July 7, 2004 10 Total amount of guarantee 26,000.00 Total balance of guarantee 26,000.00 Including: total balance of related guarantees 0.00 Total guarantees provided by the listed company for 20,000.00 controlling subsidiaries Total illegal guarantees 0.00 Proportion of total guarantees in net assets of the 37.30 Company 7.4 Current related credits and liabilities □Applicable √Inapplicable 7.5 Entrusted assets management □Applicable √Inapplicable 7.6 Implementation of commitments √Applicable □Inapplicable The Company’ s profit distribution scheme is: allotting bonuses at the rate of 2 shares for every 10 share to all shareholders based on total share capital amounting to 365,500,000 shares at the end of 2002. The Company finished implementing the profit distribution scheme on Aug. 2003. 7.7 Significant lawsuits and arbitrations √Applicable □Inapplicable The Company involved in one lawsuit in the report period. The progress of the lawsuit that the Company indicted Tianjin TEDA Co., Ltd. (hereinafter referred to as TEDA Company) to act against machining contract is as follows: The case of machining contract dissension between Chengde Dixian Textile Co., Ltd. and Tianjin TEDA Co., Ltd. was judged by Hebei Provincial Higher People’ s Court through (2003) JMEZZI NO. 22 Judgment as follows: 1. Withdraw (2002) CMCZI NO. 189 Civil Judgment of Hebei Province Chengde Intermediate People’ s Court; 2. TEDA Company took away 14180 sets of warm underwear at its own expenses within 15 days after the judgment took effect and paid RMB 440,847.20 machining expense to the Company. 3. Turn down other lawsuit request of the Company. The Company believes that the judgment is not just and will continue to indict. 7.8 Particulars about duties performance of Independent Directors According to the requirements of provisions in Rules on Administration of Listed Companies and Guidance Opinion on Establishing Independent Director System in Listed Companies, the Company has engaged three independent directors, taking one third of total director in the Company. The independent directors fully exerted their 11 roles, expressed opinions on some significant events of the Company and played active role on the scientific decision-making of the Board of Directors and the normative operation of the Company, which has safeguarded the interests of the Company and all shareholders in a diligent and responsible attitude. §8. Report of the Supervisory Committee The Supervisory Committee of the Company considered that the Company operated according to laws and there was no problem existing in the financial position, use of the raised proceeds, acquisition, sales of assets and related transactions of the Company. Moreover, the Company was presented with unqualified opinion, thus the Supervisory Committee had no special explanation. §9. Financial Report 9.1 Report of the Auditors To the shareholders of Chengde Dixian Textile Co., Ltd. (Incorporated in the People’ s Republic of China with limited liability) We have audited the accompanying consolidated balance sheet of Chengde Dixian Textile Co., Ltd. (the “Company”) and its subsidiaries (the “Group”) as of 31 December 2003 and the related consolidated income and cash flow statements for the year then ended. These consolidated financial statements set out on pages 2 to 32 are the responsibility of the Company’ s management. Our responsibility is to express an opinion on these consolidated 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 statement 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 consolidated financial position of the Group as of 31 December 2003 and of the consolidated results of its operations and its consolidated cash flows for the year then ended in accordance with International Financial Reporting Standards. PricewaterhouseCoopers 9 March 2004 9.2 Financial statement CHENGDE DIXIAN TEXTILE CO., LTD. CONSOLIDATED INCOME STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2003 12 For the year ended 31 December Notes 2003 2002 RMB’000 RMB’000 Sales 3,28(a) 523,600 463,088 Cost of sales 28(a) (298,484) (282,358) Gross profit 225,116 180,730 Other operating income 28,697 - Distribution costs (9,461) (11,945) Administrative expenses 28(c) (19,499) (19,183) Other operating expenses (24,958) (378) Profit from operations 4 199,895 149,224 Finance costs - net 6 (15,855) (9,936) Share of results of an associate before tax 213 - Profit before tax 184,253 139,288 Income tax expense 7 (24,359) (13,886) Profit before minority interest 159,894 125,402 Minority interest 19 (16,847) (10,099) Net profit 143,047 115,303 Dividends 8 - 11,395 Earnings per share - Basic 9 RMB0.34 RMB0.26 - Diluted 9 N/A N/A CHENGDE DIXIAN TEXTILE CO., LTD. CONSOLIDATED BALANCE SHEET AS OF 31 DECEMBER 2003 Notes 31 December 2003 31 December 2002 RMB’000 RMB’000 ASSETS Non-current assets Property, plant and equipment 10,28(b) 1,380,574 1,333,976 Land use rights 11 100,163 87,698 Prepayments for property, plant and 28(b) 136,329 69,895 equipment 13 Investment in an associate 12 225,015 11,000 Prepayment for investment - 36,338 Deferred tax assets 21 314 969 Other non-current assets 2,421 2,475 1,844,816 1,542,351 Current assets Inventories 13 126,361 102,545 Trade receivables 14,28(b) 109,642 84,844 Other receivables and prepayments 15,28(b) 91,112 18,029 Cash and bank balances 16 135,880 91,892 462,995 297,310 Total assets 2,307,811 1,839,661 EQUITY AND LIABILITIES Capital and reserves Share capital 17 438,600 365,500 Reserves 18 254,993 188,228 693,593 553,728 Minority interest 19 277,340 260,393 Non-current liabilities Borrowings 20(a) 278,000 220,000 Deferred tax liabilities 21 2,634 3,073 Other non-current liabilities 22 26,905 27,887 307,539 250,960 Current liabilities Trade payables 23,28(b) 304,231 172,948 Other payables and accrued charges 24,28(b) 175,430 181,026 Current income tax liabilities 400 2,430 Borrowings 20(b) 549,278 418,176 1,029,339 774,580 Total equity and liabilities 2,307,811 1,839,661 CHENGDE DIXIAN TEXTILE CO., LTD. CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’EQUITY FOR THE YEAR ENDED 31 DECEMBER 2003 Reserves Share Share Share Revaluation issuance Statutory Retained capital premium reserve costs reserves earnings Total RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Note17) (Note 18) (Note 18) (Note I) (Note 18) (Note 18) Balance at 1 January 2002 215,000 128,438 24,819 - 24,203 57,360 449,820 14 Net profit for the year - - - - - 115,303 115,303 Appropriation from net profit (Note 18) - - - - 17,295 (17,295) - Appropriation –bonus issue 43,000 - - - - (43,000) - Transfer to share capital (Note 17) 107,500 (107,500) - - - - - Dividends - 2001 - - - - - (11,395) (11,395) Balance at 31 December 2002 365,500 20,938 24,819 - 41,498 100,973 553,728 Net profit for the year - - - - - 143,047 143,047 Appropriation from net profit (Note 18) - - - - - 21,457 (21,457) - Appropriation – bonus issue (Note 17) 73,100 - - - - (73,100) - Share issuance costs - - - (3,182) - (3,182) Balance at 31 December 2003 438,600 20,938 24,819 (3,182) 62,955 149,463 693,593 Note I: Share issuance costs represent expenses incurred for the planned additional future issue of shares of the Company to be listed in securities market. The balance will be offset against the share premium arising from the issue of new shares. CHENGDE DIXIAN TEXTILE CO., LTD. CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2003 For the year ended 31 December Notes 2003 2002 RMB’000 RMB’000 Cash flows from operating activities Cash generated from operations 25 238,811 328,522 Interest paid (17,506) (10,394) Taxes paid (25,221) (13,130) Net cash generated from operating activities 196,084 304,998 Cash flows from investing activities Purchases of property, plant and equipment (343,776) (382,554) Time deposits placed, net (12,902) (60,000) Interest received 2,578 1,090 Net cash used in investing activities (354,100) (441,464) Cash flows from financing activities 15 Borrowings raised 189,102 151,235 Payment of dividends - (11,395) Net cash generated from financing activities 189,102 139,840 Increase in cash and cash equivalents 31,086 3,374 Cash and cash equivalents at beginning of year 31,892 28,518 Cash and cash equivalents at end of year 16 62,978 31,892 9.3 Compared with the latest annual report, explanation on changes in accounting policy, accounting estimate and calculation method 1. Detailed explanation on changes in accounting policy The Group adopted the revised Accounting Standards for Business Enterprises-Events After-Balance-Sheet-Date from July 1, 2003. Before adopting the revised Standards, the cash dividends are confirmed as liabilities from shareholders’rights and interests during the period when the Board of Directors establishes profit distribution scheme. While after July 1, 2003, the cash dividends are confirmed as liabilities during the period when Shareholders’General Meeting approves the profit distribution scheme. The changes in accounting policy arising from the adoption of the Standards have been conducted retroactive adjustment. 2. There was no change in accounting estimate. 3. There was no change in accounting method. 9.4 Compared with the latest annual report, the consolidated scope changes with reasons as follows: The Company newly increased one sub-subsidiary and one associated company. Board of Directors of Chengde Dixian Textile Co., Ltd. Mar. 10, 2004 16