*ST本实B(200041)深本实Ｂ2003年年度报告摘要（英文版）

SHENZHEN BENELUX ENTERPRISE CO., LTD. SUMMARY OF ANNUAL REPORT 2003 §1. Important Notes 1.1 Board of Directors of SHENZHEN BENELUX ENTERPRISE CO., LTD. (hereinafter referred to as the Company) hereby confirms that there are no any important omissions, fictitious statements or serious misleading information carried in this report, and shall take all responsibilities, individual and/or joint, for the reality, accuracy and completion of the whole contents. The summary of annual report 2003 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 Due to business trip, Director Mr. Lin Bingjun and Independent Director Mr. Zhou Yan were absent from the Board meeting, in which the 2003 Annual Report was examined. 1.4 Shenzhen Nanfang Minhe Certified Public Accountants and Moore Stephens Certified Public Accountants respectively issued the unqualified Auditors’Report with emphatic events paragraph for the Company; and the Board of Directors and the Supervisory Committee of the Company made explanations in details for the relevant events, the investors are suggested to notice the content. 1.5 Mr. Huang Xianfeng, Chairman of the Board, Ms. Gu Xiaohong, Person in Charge of Accounting 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 SHEN BENELUX-B Stock code 200041 Listed stock exchange Shenzhen Stock Exchange Registered address and office Building No. 11, Nanyou Zhongxing Industry Village, address Nanshan District, Shenzhen Post code 518054 Internet web site of the Company Naught E-mail of the Company szshbshi@public.szptt.net.cn 1 2.2 Contact person and method Secretary of the Board of Securities Affairs Representative Directors Name Shen Yanlei Contact address Building No. 11, Nanyou Zhongxing Industry Village, Nanshan District, Shenzhen Telephone 0755-26068614、26068025 Fax 0755-26068031 E-mail szshbshi@public.szptt.net.cn §3. Summary of Accounting Data and Financial Indexes 3.1 Major accounting data (Unit: In RMB) Increase/decrease 2003 2002 compared with the 2001 last year（％） Income from main operations 49,574,924.26 56,938,732.26 -12.93% 66,713,870.35 Total profit -15,489,189.80 7,655,019.19 -302.34% 12,832,626.53 Net profit -18,032,185.91 2,921,670.56 -717.19% 7,059,260.21 Net profit after deducting -23,770,448.95 2,707,878.22 -977.83% 7,038,672.77 non-recurring gains and losses Increase/decrease At the end of At the end of compared with the At the end of 2003 2002 end of previous 2001 year（％） Total assets 305,182,140.08 262,144,738.49 16.42% 262,420,517.09 Shareholder’s equity (excluding 107,295,525.03 125,327,710.94 -14.39% 122,406,040.38 minority interests) Net cash flow arising from -56,000,458.84 14,779,230.64 -478.91% -1,584,730.51 operating activities 3.2 Major financial indexes (Unit: In RMB) Increase/decrease 2003 2002 compared with 2001 the last year（％） Earnings per share -0.30 0.05 -720.83% 0.12 Return on equity -16.81% 2.33% -821.46% 5.77% Return on equity as calculated based on net -22.15% 2.16% -1125.46% 5.75% profit after deducting non-recurring gains 2 and losses Net cash flow per share arising from -0.93 0.24 -479.51% 0.00 operating activities Increase/decrease At the end At the end compared with At the end of of 2003 of 2002 the end of 2001 previous year（％） Net assets per share 1.77 2.07 -14.43% 2.02 Net assets per share after adjustment 1.76 1.91 -8.07% 1.88 3.3 Difference of net profit as audited by Chinese Accounting Standard (CAS) and International Accounting Standard (IAS) □Applicable √Inapplicable §4. Changes in Share Capital and Particulars about Shareholders 4.1 Statement of change in share capital (Unit: share) Increase / decrease in Before the change After the change this time (+, -) I. Unlisted Shares 1. Sponsors’shares 43,318,000 0 43,318,000 Including: State-owned share 0 0 0 Domestic legal person’ s shares 28,031,078 0 28,031,078 Foreign legal person’ s shares 15,286,922 0 15,286,922 Others 0 0 2. Raised legal person’ s shares 0 0 3. Inner employees’shares 1,452,000 0 1,452,000 4. Preference shares or others 0 0 Total unlisted shares 44,770,000 0 44,770,000 II. Listed Shares 1. RMB ordinary shares 0 0 2. Domestically listed foreign shares 15,730,000 0 15,730,000 3. Overseas listed foreign shares 0 0 4. Others 0 0 Total listed shares 15,730,000 0 15,730,000 III. Total shares 60,500,000 0 60,500,000 4.2 Statement of shares held by the top ten shareholders and the top ten shareholder of circulation share Total number of shareholders at the end of report year 5,369 3 Particulars about shares held by the top ten shareholders Number of Increase / Shares held Nature of shareholders Type of shares share decrease in at the Proportion (State -owned Full name of Shareholders (Circulating/No pledged/ the report year-end (%) shareholder/foreign n-circulating) frozen year (share) (share) shareholder) (share) Shekou Hansheng Electronic Co., Ltd. 0 19,558,077 32.33 Non-circulating 19,558,077 State-owned shareholder Hong Kong Jiali Precision 0 14,247,290 23.55 Non-circulating 0 Foreign shareholder Manufacturing Co., Ltd. Wuhan Huaxing Electronic Co., Ltd. 0 8,473,001 14.00 Non-circulating 8,473,001 State-owned shareholder Jieli (Hong Kong) Sound Industry Co., 0 1,039,632 1.72 Circulating 0 Foreign shareholder Ltd. WANG YAN -17,540 282,460 0.47 Circulating 0 Foreign shareholder CHEUNG, HON HING 274,420 274,420 0.45 Circulating 0 Foreign shareholder KOTO TRANSPORT LTD 0 200,000 0.33 Circulating 0 Foreign shareholder WANG JUN GANG 185,806 185,806 0.31 Circulating 0 Foreign shareholder WANG YONG 122,930 122,930 0.20 Circulating 0 Foreign shareholder XIE BAO 117,000 117,000 0.19 Circulating 0 Foreign shareholder Explanation on associated Among the above top ten shareholders, legal representative of Shekou Hansheng Electronic relationship among the top ten Co., Ltd. and legal representative of Wuhan Huaxing Electronic Co., Ltd. is the same person, shareholders or consistent action except for this, the Company is unknown whether there exist the associated relationship or belong to concerted actors the consistent actor regulated by the Management Measure of Information Disclosure on Change of Shareholding for Listed Companies. Particulars about shares held by the top ten shareholders Name of shareholder (full name) Number of circulation shares at Type (A-share, B-share, the year-end (share) H-share and other) WANG YAN 282,460 B-share CHEUNG, HON HING 274,420 B-share KOTO TRANSPORT LTD 200,000 B-share WANG JUN GANG 185,806 B-share WANG YONG 122,930 B-share XIE BAO 117,000 B-share AU, KWOK WAH 103,070 B-share ZHOU ZHONG XIN 101,030 B-share CORE PACIFIC-YAMAICHI 98,400 B-share 4 SUN LI FEGN 90,300 B-share Explanation on associated The Company is unknown whether there exists the associated relationship among the top ten relationship or belongs to concert actors the consistent actor shareholders of circulation share regulated by the Management Measure of Information Disclosure on Change of Shareholding for Listed Companies. 4.3 Particulars about controlling 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 controlling shareholder and other actual controller Shekou Hansheng Electronic Co., Ltd. (“Shekou Hansheng”) is the controlling shareholder of the Company. By the end of the report period, Shekou Hansheng held 19,558,077 sponsors’shares of the Company in total, taking 32.33% of total share capital. Shekou Hansheng has established on Dec. 11, 1984, which is a Chinese-foreign joint venture company; legal representative: Zhao Congzhao; registered capital: RMB 1 million. Chinese shareholder is Wuhan Huaxing Electronic Co., Ltd. (taking 75% of shares), foreign shareholder is Hong Kong Huabo Industry Co., Ltd. (taking 25% of shares). At present, Shekou Hansheng invests in long-term equity investment of the Company, and the other operation activities have been stopped. Wuhan Huaxing Electronic Co., Ltd. (“Wuhan Huaxing”) is the controlling shareholder of Shekou Hansheng. By the end of the report period, Wuhan Huaxing held 75% of shares of Shekou Hansheng. Wuhan Huaxing has established in 1984, and is an enterprises owned by the whole people, which is a subsidiary company of Wuhan Huazhong Information Technology Group Co., Ltd.. Its legal representative is Zhao Congzhao; registered capital: RMB 1.966 million; business scope: recording equipment for special use in broadcast; manufacture equipment of broadcast controlling and video program; retail and wholesale of computer and its fittings, hardware, AC, construction material and decoration material. The actual controller of the Company is the parent company of Wuhan Huaxing Electronic Co., Ltd., namely Wuhan Huazhong Information Technology Group Co., Ltd. (Wuhan Huaxing is an enterprises owned by the whole people, which controlled by Wuhan Huazho ng Information Technology Group Co., Ltd., held state-owned enterprise legal person’s share). Wuhan Huazhong Information Technology Group Co., Ltd. (“Wuhan Huazhong”) has established on Dec. 29, 1999, registered capital: RMB 261.06 million, legal representative is Zhao Congzhao, state-owned sole 5 enterprise, which was in charge of Wuhan Municipal State-owned Assets Management Bureau, business scope of Wuhan Huazhong: operation and management of state-owned assets authorized by municipal government; property right transaction of state-owned assets, providing agency and information service; operation of self-produced manufacture and the relevant technology; R&D of raw material and import and export of the relevant technology; undertaking the following business such as Chinese- foreign joint venture, cooperation, production and process raw materials on clients’ demands, assemble parts for the clients and process according to the clients’samples. §5. Particulars About Directors, Supervisors and Senior Executives 5.1 Particulars about changes in shares held by directors, supervisors and senior executives Shares held Shares held Change Name Title Sex Age Office term at the at the for reason year-begin year-end Jun. 15, 2001- Huang Xianfeng Chairman of the Board Male 54 24,200 24,200 Jun. 15, 2004 Jun. 15, 2001- Zhou Jiachen Director Male 51 0 0 Jun. 15, 2004 Jun. 15, 2001- Zhou Jiaping Director Male 53 0 0 Jun. 15, 2004 Jun. 15, 2001- Lin Bingjun Director Male 54 0 0 Jun. 15, 2004 Sep.30, 2003- Zhang Lihong Director Female 34 0 0 Jun. 15, 2004 Jun. 30, 2002- Zhou Yan Independent Director Male 37 0 0 Jun. 15, 2004 Sep.30, 2003 Li Yinghong Independent Director Male 32 0 0 -Jun. 15, 2004 Chairman of the Supervisory Jun. 15, 2001- Hui Shujian Male 47 500 500 Committee Jun. 15, 2004 Jun. 15, 2001- Li Lingling Supervisor Female 38 1210 1210 Jun. 15, 2004 Jun. 15, 2001- Zhou Jiaqing Supervisor Male 39 0 0 Jun. 15, 2004 Jun. 15, 2001- Li Mian General Manager Male 36 0 0 Jun. 15, 2004 6 Jun. 15, 2001- Shen Yanlei Secretary of the Board Male 34 0 0 Jun. 15, 2004 5.2 Particulars about directors and supervisors holding the post in Shareholding Company √Applicable □Inapplicable Drawing the payment Title in Shareholding Name Name of Shareholding Company Office term from the Shareholding Company Company (Yes / No) Huang Shekou Hansheng Electronic Co., Ltd. Director 1988 to now No Xianfeng Jieli (Hong Kong) Sound Industry LinBingjun Chairman of the Board 1997 to now Yes Co., Ltd. 5.3 Particulars about the annual remuneration of directors, supervisors and senior executives Total annual remuneration RMB 144,000 Total annual remuneration of the top three RMB 84,000 directors drawing the highest payment Total annual remuneration of the top three senior RMB 124,000 executives drawing the highest payment Allowance of independent director RMB 0.00 per person/ year Other treatment of independent directors Naught Name of directors and supervisors receiving no Zhou Jiachen, Zhou Jiaping, Zhou Jiaqing, Zhou Yan, Li remuneration or allowance from the Company Yinghong, Zhang Lihong and Lin Bingjun Payment Number of persons RMB 80,000 ～ RMB 90,000 1 RMB 10,000 ～ RMB 20,000 3 7 §6. Report of the Board of Directors 6.1 Discussion and analysis to the whole operation in the report period 1. Analysis and discussion of the Management: In the report period, the management level of the Company adopted age analysis way on the doubtful debts, and based on the past experience and the finance and actual operation status of the debtor organizations, integrating the suggestions of overseas Certified Public Accountants and concerning about the cautio usness principle, the Company increased the amount of withdrawing the reserve for doubtful debts by a bog margin, so this year the Company suffered loss amounting to RMB 18.03 million. 2. Scope of core business and operation: The Company is mainly engaged in the production and sales of magnetism recording products, high-grade office products, biological products/blood products, medical appliance and simulation products. Of them, in the respect of magnetism recording products, due to the increase of orders, the sale increased 21.93% compared with the same period of last year; in the aspect of medical appliance, the Company still produced shock wave lithotritor outside the body, operational appliances and series of ache equipments acting imported as leading products; in the aspect of biological blood products, the Company still produced Human Albumin, IVIG, injection IG and HBV Immunoglobulin as leading products and II type of new product was inspected to be illegible and was put into clinical use. However in the report period, because of the effects of SARS, the sales income of medical appliance and biological blood products decreased compared with the same period of last year, which resulted in the decrease of income from core business compared with the same period of last year, an decrease of 12.29% and realizing income from core business only amounting to RMB 49.5749 million. 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 (%) (%) (%) Manufacture of machines used for 1,144.67 1,125.15 1.71 21.93 16.75 164.53 cultural and office Manufacture of medical 765.38 319.68 58.23 -7.49 -11.30 3.17 8 instruments Manufacture of 3,013.33 1,532.28 49.15 -22.24 -12.21 -10.57 biological medicine Manufacture of other 34.11 24.81 27.26 -34.84 -49.31 319.38 special equipments Including: related 0.00 0.00 - 0.00 0.00 0.00 transactions Electronic products 1,144.67 1,125.15 1.71 21.93 16.75 164.53 Medical instruments 765.38 319.68 58.23 -7.49 -11.30 3.17 Biological blood 3,013.33 1,532.28 49.15 -22.24 -12.21 -10.57 products Simulation series 34.11 24.81 27.26 -34.84 -49.31 319.38 products Including: related 0.00 0.00 - 0.00 0.00 0.00 transactions Pricing rules for related No related transaction transactions Necessity and durative No related transaction of related transactions 6.3 Particulars about main operations classified according to areas Unit: RMB’0000 Areas Income from main operations Increase/decrease in income from main operations over the last year (%) Hong Kong 1,144.67 21.93 South Central 1,287.12 -12.83 Southwest 1,285.97 -13.04 Northeast 182.86 -18.90 South China 497.35 -43.47 Other areas 559.52 -19.41 6.4 Particulars about the customers of purchase and sales Unit: RMB’0000 Total amount of purchase 1,729.82 Proportion in the total 83.51% of the top five suppliers amount of purchase Total amount of sales of the 3,630.90 Proportion in the total 73.24% 9 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 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 □Applicable √Inapplicable 6.14 Explanation of the Board of Directors on the “Qualified Opinion” made by the Certified Public Accountants √Applicable □Inapplicable 10 In the report period, due to overdue liabilities of the Company, Shenzhen Nanfang Minhe Certified Public Accountants and Moore Stephens Certified Public Accountants issued auditing opinion with emphatic events for the Company (For details, please refer to Notes to Accounting Statements II. 24). Aiming at relevant events, the Company planned to adopt the following improvement measures: 1. Shekou Hansheng Electronic Co., Ltd. (Hereinafter referred to as “Shekou Hansheng”), the originally first largest shareholder of the Company, signed equity transfer agreement with Hainan Rulai Timber Co., Ltd. (Hereinafter referred to as “Hainan Rulai”) on Dec. 11, 2003 and transferred its social legal person’ s shares amounting to 14,668,557 shares of the Company (occupying 24.25% of total issued shares of the Company) to Hainan Rulai at total price amounting to RMB 33,000,000. Shekou Hansheng has injected the fund from equity transfer received completely into the Company, used for refunding the arrearages to the Company and helping the Company to solve the overdue liabilities of the banks in short term. 2. After this equity transfer, Hainan Rulai became the first largest shareholder of the Company. The Company was hopeful to inject capital and good assets through introducing into new shareholders, enhance the Company’ s profitability capability and improve the cash flow so as to completely solve the bank liabilities. Though the Company had the said material uncertainties in the sustainable operation, however, the Company was sure to basically eliminate its influence through the said improvement measures. Thus the accounting statements in the period was still prepared based on sustainable operation without adjustment to quantity and classification of assets and liabilities necessary under the situation that the operation can not be sustainable. 6.15 Business plan as of the next year of the Board of Directors (If it has) □Applicable √Inapplicable 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 The Company would not distribute profits due to losses in 2003. The said profit pre-distribution plan still should be submitted to Shareholders’General Meeting for consideration and approval. If the resolution of Shareholders’General Meeting is different from the suggestion, it will be adjusted according to the distribution plan decided by the Shareholders’General Meeting. 11 §7. Significant Events 7.1 Purchase of assets □Applicable √Inapplicable 7.2 Sales of assets □Applicable √Inapplicable 7.3 Important guarantee □Applicable √Inapplicable 7.4 Related credits and liabilities current □Applicable √Inapplicable 7.5 Entrusted assets □Applicable √Inapplicable 7.6 Implementation of commitment items □Applicable √Inapplicable 7.7 Significant lawsuit and arbitration □Applicable √Inapplicable 7.8 Particulars about the performance of obligations of Independent Directors According to the requirement of CSRC and Shenzhen Securities Management Office, the Shareholders’ General Meeting of the Company elected two experts as independent directors, initially consummated the legal person administrative structure, reformed the structure of the Board of Directors, improved the level of decision of the Board of Directors and standardized the operation of the Company. In the report period, the two independent directors independently implemented duties according to Guide Opinion on Establishing Independent Directors System in Listed Company and Articles of Association. They totally attended three meetings of the Board of Directors, played fully a role of independent directors and safeguarded the whole interest of the Company especially the legal rights and interest of the medium and small shareholders. §8.Report of the Supervisory Committee Operation according to laws: The Supervisory Committee believes that the decision- making procedure of the Company in the report period was legal and the more perfect internal control system was been finished. There found no behaviors of breaking laws, regulations and Articles of Association of the Company or damaging the interest of the Company when the directors and managers of the Company implemented the duties in the Company. Inspection of the Company’s financial status: 12 The Supervisory Committee believes that the auditors’ report issued by Shenzhen Nanfang Minhe Certified Public Accountants and Moore Stephens Certified Public Accountants truly reflected the financial situation and operation result of the Company. Aiming for the interpretative explanation of Certified Public Accountants that there existed significant uncertainty in the consistent operation of the Company, the Supervisory Committee supposed that the amelioration measures put forward by the Board of Directors basically eliminated the influence of the significant uncertainty existing in the consistent operation of the Company, so the establishment of the current accounting statement was based on the consistent operation and it was feasible that there made no necessary adjustment for the amount and classification of assets and liabilities under the situation of being unable to operate consistently. §9. Financial Report 9.1 Auditor’ s opinion(attached) 9.2 Accounting statement (attached) 9.3 Accounting policy, accounting assessment and settlement method has no change compared with the latest annual report. 9.4 The consolidation scope has no change in the report period compared with the latest annual report. Board of Directors of Shenzhen Benelux Enterprise Co., Ltd. April 30, 2004 13 Auditor ’ s opinion We have audited the accompanying consolidated balance sheet of Shenzhen Benelux Enterprise Company Limited (‘the Company”) and its subsidiar ies (“the Group”) as of 31 December 2003 and the related consolidated income statement, consolidated statement of cash flows and changes in equity for the year then ended. These financial statements set out on pages 2 to 22 are the responsibility of the Group'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 the management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Group as of 31 December 2003 and the results of the operations and cash flows of the Group for the year then ended in accordance with International Financial Reporting Standards. Without qualifying our opinion, we draw attention to Note 2 in the financial statements which indicates that, as of 31 December 2003, the Group’ s current liabilities exceeded its current assets by RMB4,659,000, and the short-term loans of the Group were overdue which amount to RMB18,850,000 and USD3,937,000 as at 31 December 2003. The extension of their repayment terms have not agreed with the banks. These conditions, along with other matters as set forth in Note 2, indicate the existence of a material uncertainty which may cast significant doubt about the Group’ s ability to continue as a going concern. MOORE STEPHENS SHENZHEN NANFANG MINHE Certified Public Accountants [29] April 2004 14 CONSOLIDATED INCOME STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2003 I. Notes 2003 2002 RMB’000 RMB’000 Turnover, net 4、5 49,575 56,939 Cost of sales (30,292) (31,529) Gross profit 19,283 25,410 Other income, net 6 234 462 Selling expenses (2,239) (1,700) General and administrative expenses (29,714) (11,911) (Loss)/profit from operations 7 (12,436) 12,261 Finance costs 8 (7,895) (4,728) Investment income, net 9 4,842 122 (Loss)/profit before taxation (15,489) 7,655 Taxation 10 (2,771) (4,698) (Loss)/profit after taxation (18,260) 2,957 Minority interests 228 (35) Net (loss)/profit for the year (18,032) 2,922 (Loss)/earnings per share 11 RMB(0.30) RMB0.05 15 CONSOLIDATED INCOME STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2003 II. Notes 2003 2002 RMB’000 RMB’000 Turnover, net 4、5 49,575 56,939 Cost of sales (30,292) (31,529) Gross profit 19,283 25,410 Other income, net 6 234 462 Selling expenses (2,239) (1,700) General and administrative expenses (29,714) (11,911) (Loss)/profit from operations 7 (12,436) 12,261 Finance costs 8 (7,895) (4,728) Investment income, net 9 4,842 122 (Loss)/profit before taxation (15,489) 7,655 Taxation 10 (2,771) (4,698) (Loss)/profit after taxation (18,260) 2,957 Minority interests 228 (35) Net (loss)/profit for the year (18,032) 2,922 (Loss)/earnings per share 11 RMB(0.30) RMB0.05 (The notes on pages 7 to 23 form an integral part of these financial statements) 16 SHENZHEN BENELUX ENTERPRISE COMPANY LIMITED CONSOLIDATED BALANCE SHEET AS AT 31 DECEMBER 2003 Notes 2003 2002 RMB’000 RMB’000 NON-CURRENT ASSETS Property, plant and equipment 12 65,505 69,345 Negative goodwill 13 (856) (978) Other investment — 28,880 Land use rights 14 42,696 43,547 Franchise rights 15 12,901 14,925 Proprietary technology 400 480 Deferred assets 817 1,212 121,463 157,411 CURRENT ASSETS Inventories 16 14,624 15,753 Notes receivable — 7,342 Accounts receivable, prepayments and other receivables 17 134,490 79,152 Cash and bank balances 34,605 2,487 183,719 104,734 CURRENT LIABILITIES Notes payable 4,116 ---- Accounts payable, accruals and other payables 25,548 28,032 Taxes payable 5,187 7,555 Short-term loans 18 153,527 96,494 188,378 132,081 Net current liabilities (4,659) (27,347) MINORITY INTERESTS 4,508 4,736 NON-CURRENT LIABILITIES Long-term loans 19 5,000 — 107,296 125,328 SHAREHOLDERS’EQUITY Share capital 20 60,500 60,500 Reserves 21 46,796 64,828 107,296 125,328 The financial statements on pages 2 to 23 were approved and authorised for issue by the Board of Directors on [28] April 2004 and signed on its behalf by: DIRECTOR DIRECTOR 17 CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2003 2003 2002 RMB’000 RMB’000 OPERATING ACTIVITIES: (Loss)/profit before taxation (15,489) 7,655 Adjustment: Provision for bad debts 18,750 2,664 Depreciation 4,567 4,499 Amortization of land use rights 912 912 Amortization on goodwill (122) (122) Amortization of franchise rights 2,023 2,023 Amortization of proprietary technology 80 80 Amortization of deferred assets 396 421 Loss/(gain) on disposal of property, plant and equipment — (283) Interest expenses 9,681 4,680 Interest income (1,865) (8) Operating cash flows before movement in working capital 18,933 22,521 Decrease in notes receivable — — Increase in accounts receivable, prepayments and other receivables (85,327) (9,630) Decrease in inventories 1,129 284 Increase in notes payable — — Increase in accounts payable, accruals and other payables 11,633 1,454 (Decrease)/increase in taxes payable (2,368) 143 Cash (used in)/generated from operations (56,000) 14,772 Interest paid (7,020) (4,012) (63,020) 10,760 Net cash (used in)/generated from operations CONSOLIDATED STATEMENT OF CASH FLOWS (Continued) FOR THE YEAR ENDED 31 DECEMBER 2003 2003 2002 18 RMB’000 RMB’000 INVESTING ACTIVITIES: Proceeds from disposal of other investment 33,600 — Interest received — 8 Purchase of property, plant and equipment (494) (421) Proceeds from disposal of property, plant and equipment — 1,216 NET CASH OUTFLOW FROM INVESTING ACTIVITIES 33,106 803 FINANCING ACTIVITIES: Decrease in short term loan (51,959) (40,832) Repayment of long term loans — — New bank loans 113,991 29,773 Increase in pledged deposits — — NET CASH OUTFLOW FROM FINANCING 62,032 (11,059) ACTIVITIES DECREASE IN CASH AND CASH EQUIVALENTS 32,118 504 CASH AND CASH EQUIVALENTS AT 1 JANUARY 2,487 1,983 CASH AND CASH EQUIVALENTS AT 31 DECEMBER 34,605 2,487 (The notes on pages 7 to 23form an integral part of these financial statements. 19