佛山照明(000541)2003年年度报告摘要（英文版）

Abbr. of shares: Foshan Electrical & Lighting (A Share) Yue Electrical & Lighting (B Share) Code of shares: 000541 (A Share) 200541 (B Share) Announcement No.: 2004-001 Summary of Annual Report of 2003 of Foshan Electrical & Lighting Company Limited §1. Important Hints 1. The Board of Directors of this company and all its directors guarantee that there is no false account, misleading statement or significant omission existing in the information contained in this report, and that they shall bear the individual and joint liabilities for the truthfulness, accuracy and completeness of its content. 2. Mr. Liang Weidong, the director of the company is unable to attend the board meeting on the business trip, and has authorized Mr. Zhong Xincai, the Chairman of the Board of Directors, to vote on his behalf. Mr. Shen Weiqiang, the director of the company is also unable to attend the board meeting on the business trip, and has authorized Mr. Alfred K.N. Chong, the Vice Chairman of the Board of Directors, to vote on his behalf. 3. The accounting data and financial report in this report have been audited by KPMG Peat Marwick in Hong Kong, and respectively made in Chinese and English. In case of any misunderstanding between the two versions, the Chinese text will be prevailing. 4. Mr. Zhong Xincai, the General Manager and the financial chief of the company and Ms. Wang Shuqiong, the Manager of the Financial Department declare to guarantee the truthfulness and completeness of the financial report in this annual report. §2.General condition of the listed company 2.1 General condition Abbr. of shares Foshan Electrical & Lighting (A share) Yue Electrical & Lighting (B share) Code of shares 000541 (A share) 200541 (B share) Listing place Shenzhen Stock Exchange Registered and office address 15# Fenjiang North Road, Foshan, Guangdong Postal code 528000 Internet www.chinafsl.com E-mail gzfsligh@pub.foshan.gd.cn １ 2.2 Contact person and pattern. Secretary of Board of Directors Security Representative Name Lin Yihui Contact address #15 Fenjiang North Road, Foshan Tel (0757) 82966098,82810239 Fax (0757) 82816276 E-mail gzfsligh@pub.foshan.gd.cn §3. Summary of Accounting data and business data 3.1 Main accounting data 2003 (this year) 2002 (last year) Change with 2001 last year (%) Main business income 1,016,750,204 953,453,964 6.64 827,662,639 Total profits 279,547,095 255,183,375 9.55 215,682,086 Net profit 234,560,108 218,582,323 7.31 189,354,006 End of 2003 End of 2002 Change with 2001 (this year) (last year) last year (%) Total assets 2,431,572,874 2,359,541,714 3.05 2,243,581,689 Shareholder equity (excluding the shareholder 2,207,848,053 2,123,836,214 3.96 2,048,633,195 equity of minority shareholders) Net cash flow from business activities 235,769,297 325,528,282 -27.57 267,193,026 3.2 Main financial targets. 2003 (this 2002 (last Change with 2001 year) year) last year (%) Proceeds per share 0.65 0.61 6.56 0.53 Return rate of net assets (%) 10.62 10.29 3.21 9.24 Net cash flow per share from business activities 0.66 0.91 -27.47 0.75 2003 (end of 2002 (end of Change with 2001 this year) last year) last year (%) Net assets per share 6.16 5.93 3.88 5.72 Net assets per share after adjustment 6.12 5.90 3.73 5.69 ２ 3.3 Difference on domestic and foreign accounting standards. ü Applicable □Inapplicable Unit: CNY Domestic accounting standard Foreign accounting standard Net profit 226,325,007.00 234,560,108.00 Notes Net profits (RMB) for difference As reported in statutory financial statements prepared under PRC 226,325,007.00 accounting regulations Adjustment to align with IFRS 1. Recognition of deferred tax asset -642,488.00 2. Net unrealized gains/(losses) of investments held for trading carried at fair value 9,605,549.00 3. Realized (gains)/loss of investments held for trading -2,309,852.00 4. Write back of over-accrued interest expenses 1,581,892.00 As reported pursuant to IFRS 234,560,108.00 §4. Change of Capital Stock and Shareholders 4.1 Change of capital stock Unit: share Before this Change of this time (increase or reduce) (+ or -) After this change Rationed Granted Shares transferred from Shares newly Others Subtota change shares shares public reserve funds issued l I. Uncirculating shares 1. Founder’s share 88,397,100 88,397,100 Including: State-owned share 85,922,100 85,922,100 Domestic corporate share 2,475,000 2,475,000 Foreign corporate share Others 2. Raised corporate share 40,515,750 40,515,750 3. Internal staff share 4. Preferred share or others II. Circulating shares listed 1. RMB ordinary shares 147,035,409 147,035,409 Including: share held by directors 378,460 378,460 and supervisors. 2. Foreign share listed at home 82,500,000 82,500,000 3. Foreign share listed abroad 4. Others Total circulating shares listed 229,535,409 229,535,409 III. Total shares 358,448,259 358,448,259 Note: The 378,460 shares held by the directors and supervisors of our company have been frozen according to the relevant regulation. ３ 4.2 Shares held by the top ten shareholders Total number of shareholders at the end of report period 70969 Shares held by top ten shareholders Names of shareholders (full name) Yearly Shares held at Ratio Type of share Shares Nature of share +/-(share) year end (share) (%) (uncirulated pledged or (national or foreign or circulating) frozen (share) shareholder) State-owned Assets Office of Foshan City 0 85,922,100 23.97 Uncirculated 0 National share Youchang Lighting Equipment Trading Co., Uncirculated 0 0 7,002,641 1.95 Ltd. ,Guangzhou Baokang Consumer Goods Security Investment Funds 6,468,891 6,468,891 1.80 Circulating Unknown Yinfeng Securities Investment Funds 2,181,210 4,774,256 1.33 Circulating Unknown BTFE-VALUE PARTNERS INTELLIGENT FD-CHINA Circulating Unknown Foreign shareholder 2,921,622 4,141,349 1.16 B SHS FD (B share) Yuyuan Securities Investment Funds 1,310,091 3,976,036 1.11 Circulating Unknown 102 Combination of National Social Insurance Funds 3,606,690 3,606,690 1.01 Circulating Unknown DBS VICKERS (HONG KONG) LTD.A/C CLIENTS Circulating Unknown Foreign shareholder 1,998,579 3,502,737 0.98 (B share) Zhongji Investment Consultant Co., Ltd., Shanghai 2,906,989 2,906,989 0.81 Circulating Unknown BERMUDA TRUST (FAR EAST) LTD. VALUE Circulating Unknown Foreign shareholder 1,103,120 2,502,958 0.70 PARTNERS “A” FD (B share) Note on relationship or concerted action of Among the top ten shareholders of the company, the State-owned Assets Office of Foshan City, the shareholder for the top ten shareholder state-owned shares has neither relationship with Youchang Lighting Equipment Trading Co., Ltd., Guangzhou, nor relationship with any other shareholder, nor the shareholder of concerted action set forth in the “Regulatory Method for Disclosure of Information on Change of the Shares of the Listed Company”. It is unclear whether there is any relationship with other circulating shareholders, or if there is any shareholder of concerted action set forth in the “Regulatory Method for Disclosure of Information on Change of the Shares of the Listed Company”. Circulating shares held by top 10 shareholders Names of shareholders Circulating shares held at the year end (share) Type (A, B, H or other) Baokang Consumer Goods Security Investment Funds 6,468,891 A Share ４ Yinfeng Securities Investment Funds A Share 4,774,256 BTFE-VALUE PARTNERS INTELLIGENT FD-CHINA B SHS FD B Share 4,141,349 Yuyuan Securities Investment Funds A Share 3,976,036 #102 Combination of National Social Insurance Funds A Share 3,606,690 DBS VICKERS (HONG KONG) LTD.A/C CLIENTS B Share 3,502,737 Zhongji Investment Consultant Co., Ltd., Shanghai A Share 2,906,989 BERMUDA TRUST (FAR EAST) LTD. VALUE PARTNERS “A” B Share 2,502,958 FD Alfred K. N. Chong B Share 2,415,500 Haifutong Selected Security Investment Funds A Share 2,097,843 Note on relationship or concerted action of the top ten It is unclear whether there is any relationship with other circulating shareholders, or shareholder if there is any shareholder of concerted action set forth in the “Regulatory Method for Disclosure of Information on Change of the Shares of the Listed Company”. 4.3. Brief of controlling shareholder and actual controller 4.3.1 Change of controlling shareholder and actual controller Applicable üInapplicable 4.3.2 Details of controlling shareholder and other actual controller The first major shareholder of the company is the State-owned Assets Office of Foshan City, which is one of the founder shareholders of the company holding 85,922,100 shares at the present, making up 23.97% of the total shares of the company. Except it, there is no other corporate shareholder in the company holding more than 10% of the total shares. §5. Directors, supervisors and senior management personnel 5.1 Change of shares held by directors, supervisors and senior management personnel. Name Sex Age Post Term of offices Shares held (numbers) Term of offices Year start Year end Zhong Xincai M 61 Chairman of the Board of Directors, Jun. 2001 –Jun. 2004 74,250 134,850 Incentive funds General Manager Alfred K. N. M 52 Vice Chairman of the Board of Directors Jun. 2001 –Jun. 2004 2,388,700 2,415,500 Purchased from Chong (B share) (B share) market Liu Xingming M 41 Executive director, Vice General Jun. 2001 –Jun. 2004 21,780 50,900 Incentive funds Manager ５ Liang Weidong M 41 Director Jun. 2001 –Jun. 2004 - - Shen Weiqiang M 54 Director Jun. 2001 –Jun. 2004 - - Name Sex Age Post Term of offices Shares held (numbers) Term of offices Ye Zaiyou M 48 Director Jun. 2001 –Jun. 2004 - - Liang Zhen M 66 Independent Director Jun. 2001 –Jun. 2004 - - Wu Jianhong F 57 Independent Director May, 2002 –Jun. 2004 - - Chen Ziyun F 40 Independent Director May, 2003 –Jun. 2004 - - Huang Guanxiong M 53 Chairman of the Board of May, 2003–Jun. 2004 - - Supervisors, Chairman of the Labor Union Tan Shengzhi M 55 Supervisor Jun. 2001 –Jun. 2004 33,000 39,500 Incentive funds Huang Yazheng M 61 Supervisor Jun. 2001 –Jun. 2004 31,350 37,750 Incentive funds Zhang Chaoyang M 39 Supervisor Jun. 2001 –Jun. 2004 - - Chen Guanbiao M 55 Supervisor Jun. 2001 –Jun. 2004 - - Ou Muben M 54 Vice General Manager 33,000 53,800 Incentive funds Guo Jieming M 54 Vice General Manager - - Ma Yijun M 35 GM assistant - 17,400 Incentive funds Liang Weiqiang M 46 GM assistant - 17,600 Incentive funds Lin Yihui M 50 Secretary of the Board of - 12,700 Incentive funds Directors Wang Shuqiong F 41 Financial chief - 13,960 Incentive funds 5.2 Director and supervisor employed in the shareholder unit. ü Applicable □Inapplicable Name Name of shareholder employed Post in shareholder unit Term of post Remuneration/subsidy? Ye Zaiyou Wuzhuang Color Glazed Tiles Chair of Board of Directors Feb., 1990 till now Yes (this factory is a Factory, Nanhai popularly-run enterprise) 5.3 Annual remuneration of directors, supervisors and senior management personnel. Total annual remuneration RMB 1,290,000 Total annual remuneration of top three directors RMB 700,000 (post of director and also the senior management personnel) Total annual remuneration of top three senior RMB 700,000 (post of director and also the senior management personnel) management personnel Subsidy for independent director No subsidy, only the travel and accommodation costs for attending the board meeting and shareholders’general meeting Other welfare treatment for independent director N/A ６ Names of directors and supervisors receiving no Directors: Alfred K. N. Chong, Liang Weidong, Shen Weiqiang, Ye Zaiyou; remuneration/subsidy from the company supervisors: Zhang Chaoyang, Chen Guanbiao Division of remuneration Numbers RMB 350,000～380,000 1 RMB 100,000～200,000 3 RMB 50,000～100,000 5 §6. Report of the Board of Directors 6.1 Discussion and analysis for overall business operation during the report period. There is no change on the business scope of the company during the report period. The company has carefully summarized the production and operation circumstances in the first half year, integrated with the market situation and its production and operation target in 2003, strengthened the management, made more efforts in market development, expanded the production scale, and increased the market occupancy Despite the Gulf War and SARS in 2003, the company has made a constant and fast development in its production and business operation, gradually strengthened its market competitive power, maintained its export volume, and continuously improved its economic growing speed and benefit. Meanwhile, according to the investment project examined and approved in the Shareholders’General Meeting in the first half year, the company has decided to invest RMB 600 million to set up Foshan Electric and Lighting Industrial Park in Cangjiang Industrial Park in Gaoming District. It has already taken over the land in Sep., and made the plan and start the construction in Oct. By now, the construction for basic facilities and the arrangement in environmental protection is under progress, the project will be partially put into operation at the end of 2004, greatly increasing the production capacity of the company. In 2003, the company has made 864 million bulbs in total, increasing by 9.89% than that of the last year, and increased its gross industrial output value by 8.54%. The main business income has reached RMB 1020 million, increased by 6.63% than that of last year, and the sales from export has reached USD 39.08 million, increased by 16%. Moreover, the company has realized the total profits of RMB 270 million, 11.27% more than that of last year, and realized the net profits of RMB 226 million, growing by 10.5%. The company continues to keep the advantageous trend of constant and stable development. ７ 6.2 Industries and products of main business operation. Product Main business income Main business cost Gross Change of main Change of main business Change of gross profit profit business income cost with last year (%) rate with last year (%) rate (%) with last year (%) Electro-optical 1,021,017,077.44 640,884,574.80 37.23 6.63 7.81 -1.82 product 6.3 Distribution of main business. Region Main business income ± of main business compared with last year (%) Domestic 697,819,830.49 2.84 Foreign 323,197,246.95 15.85 6.4 Suppliers and clients Total amount on purchase from top 5 70,814,682.50 Percentage in total purchase 16.83% suppliers Total amount on sales to top 5 clients 157,674,426.06 Percentage in total sales 15.41% 6.5 Business condition of shareholding company (applicable for the case with over 10% of investment return in net profit). Applicable ü Inapplicable 6.6 Reason for significant change of main business and its structure. Applicable ü Inapplicable 6.7 Reason for significant change of profitability of main business (gross profit rate) compared with last year. Applicable ü Inapplicable 6.8 Reason for significant change of business result and profit composition compared with last year. Applicable ü Inapplicable Reason for significant change of overall financial status compared with last year. Applicable ü Inapplicable ８ 6.9 Notes for significant change of the business environment, macro policy and regulations for production, which has already, is and will seriously affect the financial status and business result of the company. ü Applicable Inapplicable As an enterprise in electro-optical industry, the company has encountered some major problems: first, the supply in the domestic market for photo-electric products still exceeds the supply, making the market and price competition more and more violent. The second one is the rise in price of raw materials. The prices of production materials in the market have risen since the last half of 2003, which has increased the production cost. Thirdly, it is the electricity supply for the enterprise. Because it is difficult to guarantee the industrial power supply due the pressure on electricity in Guangdong Province, it may adversely affect the production of the company to a certain extent. Facing such difficulties, the company will take the powerful measures, expand the production scale, control the production management and operation costs, and improve the labor and production efficiency, to enhance its market competition and improve the economic benefits. 6.10 Fulfillment of estimated profit. Applicable ü Inapplicable 6.11 Fulfillment of business plan. Applicable ü Inapplicable 6.12 Use of funds raised. ü Applicable Inapplicable Total funds raised ￥667 million Amount of funds raised already used this year ￥98 million Amount of funds raised already used cumulatively ￥632 million Project committed Amount to be invested Project changed or Investment actually made Proceeds Comply with progress plan & (￥10,000) not (￥10,000) (￥10,000) estimated proceeds or not 21,575.5 22,618 T8 No 6228 Yes T5 19,200 No 12,869 359 No Double loop 2,940 No 2,700 - Yes Test center 2,962 No 3,314 - Yes Three kilns 2,920 No 3,332 - Yes Tube-pulling No - Yes 2,944 2,345 production line Filament and lead 2,950 No 4,806 - Yes Power facilities 2,900 No 2,880 - Yes ９ Environment No 2,863 - Yes 2,800 & fire-fighting Current funds 5,500 No 5,500 - Total 66691.5 63,227 Notes for failure to meet the progress plan and It is planned to introduce 4 production lines for T5 lamps. Actually, only three have been estimated proceeds (itemized) completed, and there are still one not introduced yet. The main reason for this is that the T5 market has a slower development than T8 market, and the company pays more attention on developing T8. The company will quicken the T5 project based on the market situation in 2004 Change of project. Applicable üInapplicable 6.13 Project by funds no raised. ü Applicable Inapplicable Name of project Amount of project Progress of project Proceeds of project Spark plug Planed to invest RMB 50 million The company has already invested Under progress RMB 1.8 million, and is making the test run. It will continue to make investment and expansion Kinescope for visual intercom Planed to invest RMB 10 million The company has already invested Under progress doorbell RMB 1 million. Ordinary bulb Planed to invest RMB 88.9 million The company has already invested Under progress RMB 10.64 million. Miniature automotive lamp Planed to invest RMB 36 million The company has already invested Under progress RMB 14.56 million. Various lighting accessories Planed to invest RMB 50 million The company has already invested Under progress RMB 3.3 million. 6.14 Notes of the Board of Directors to the “Non-standard Opinion” of the certified public accountants’office. Applicable ü Inapplicable 6.15 Business plan of the Board of Directors in the year to come (if any). Applicable ü Inapplicable Profit estimation of the year to come (if any) Applicable ü Inapplicable １０ 6.16 Draft plan for profit distribution and share transfer from capital surplus of the Board of Directors this time. According to the net profit audited by Zhengzhong Zhujiang Certified Public Accountants, Guangdong (which is lower than that audited by KPMG Certified Public Accountants in Hong Kong), the minimum net profits realized of the company in 2003 is RMB 226,325,007.49. The profits available for distribution to shareholders this year after deducting 10% of legal surplus, 10% of public welfare funds and 5% of arbitrary earned surplus is RMB 242,063,152.39 (including RMB 72,319,396.77 as the undistributed profits of last year) Based on 358,448,259 shares of capital stock at the end of 2003, the Board of Directors of the company will distribute RMB 4.60 (including the tax. Dividends for B share shall be paid after being converted into HK dollar) as the cash dividend for every 10 shares to all shareholders of A and B shares. The total dividend actually paid is RMB 164,886,199.14, and the remaining RMB 77,176,953.25 will be carried forward to the next year for distribution. There is no increase of capital stock by surplus in 2003. The cash dividend paid to shareholders of B share shall be converted into HK dollars by the middle rate between RMB and HKD declared by the Bank of China on the first business day after the resolution of the Shareholders’General Meeting. The above draft distribution plan shall be implemented upon the review and approval of the Shareholders’General Meeting. §7. Significant events. 7.1 Purchase of assets. Applicable ü Inapplicable 7.2 Sales of assets. Applicable ü Inapplicable 7.3 Significant security Applicable ü Inapplicable 7.4 Related creditor’s rights and debts. Applicable ü Inapplicable 7.5 Trust of assets Applicable ü Inapplicable １１ 7.6 Performance of committed events. Applicable ü Inapplicable 7.7 Significant suit or arbitration. Applicable ü Inapplicable 7.8 Performance of duties of the independent director. Liang Zhen, Wu Jianhong and Chen Ziyun, the independent directors of the company, have carefully performed their duties as the independent directors since they took their posts. They have attended all four board meetings held this year, made the preparations and studies before hand after receiving the notice, and fully put forward their personal opinions to earnestly maintain the overall interests of the company. §8. Report of the Board of Supervisors The Board of Supervisors thinks that the Board of Directors and the management personnel of the company have carried out the production and operation strictly according to the laws, that the financial report of the company has truly reflected the financial situation and business results of the company, that the funds raised by the company have been applied in the committed projects, that the company has neither transaction for purchase and sales of assets nor the related transaction during the report period, and that the company hasn’t granted any foreign security, or had any of its funds occupied by the related party. §9. Financial Report 9.1 Audit opinion By auditing the financial report of 2003 of the company, Zhengzhong Zhujiang Certified Public Accountants, Guangdong and KPMG Certified Public Accountants in HK have issued the standard audit report without any reservation signed by their certified public accountants. 9.2 Balance sheet, income statement and cash flow statement (attached) of the company. 9.3 No change on the accounting policy, accounting estimation and auditing method compared with the last annual report. 9.4. Compared with the last annual report, Chansheng Electric Ballasts Co., Ltd. has been included in the consolidation scope as the subsidiary. Foshan Electrical and Lighting Co. Ltd. Board of Directors Mar. 25, 2004 １２ Consolidated income statement for the year ended 31 December 2003 (Expressed in Renminbi Yuan) Note 2003 2002 Rmb Rmb Revenue 2 1,016,750,204 953,453,964 Cost of sales (637,119,027) (590,068,720) 379,631,177 363,385,244 Gross profit Other operating income 4 2,959,140 7,408,237 Selling expenses (49,106,285) (37,205,759) Administrative expenses (70,210,222) (87,151,988) Other operating expenses 5 (8,312,301) (11,557,898) 254,961,509 234,877,836 Profit from operations Net financial income 7 9,611,996 4,405,114 Net investment income 8 16,203,947 16,922,497 Share of (loss)/profit of associate (1,230,357) (1,022,072) Profit from ordinary activities before 279,597,076 255,183,375 taxation Income tax expense - company and subsidiaries 9(a) (44,950,019) (37,406,946) - associate Profit from ordinary activities after 234,597,076 217,776,429 taxation Minority interests (36,968) 805,894 Profit attributable to shareholders 19 234,560,108 218,582,323 Basic earnings per share 23 0.65 0.61 =========== =========== No separate consolidated statement of recognized gains and losses has been prepared as the net profit for the year would be the only component of this statement. 14 Consolidated balance sheet at 31 December 2003 (Expressed in Renminbi Yuan) Note 2003 2002 Rmb Rmb ASSETS Non-current assets Property, plant and equipment 10 689,072,275 623,742,316 Lease prepayments 11 113,668,395 111,994,038 Construction in progress 12 56,099,424 69,364,002 Investment in an associate 13 27,808,546 29,038,903 Other investments 14 97,504,443 100,086,416 Deferred tax assets 15 10,766,710 11,409,198 994,919,793 945,634,873 Current assets Other investments 14 107,713,721 15,932,055 Inventories 16 117,529,504 101,063,851 Trade receivables 155,795,799 108,055,460 Deposits, prepayments and other receivables 17 22,586,554 20,957,004 Cash and cash equivalents 18 1,033,027,503 1,167,898,471 1,436,653,081 1,413,906,841 2,431,572,874 2,359,541,714 -------------------- -------------------- Total assets ============ ============ 15 Consolidated balance sheet at 31 December 2003 (continued) (Expressed in Renminbi Yuan) Note 2003 2002 Rmb Rmb EQUITY, MINORITY INTERESTS AND LIABILITIES Capital and reserves Share capital 358,448,259 358,448,259 Share premium 1,186,000,059 1,186,000,059 Other reserves 663,399,735 579,387,896 19 2,207,848,053 2,123,836,214 5,236,051 5,149,083 Minority interests Current liabilities Trade payables 89,538,128 93,229,861 Taxation 9(c) 6,518,649 28,945,157 Accruals and other payables 20 71,644,836 59,828,485 Salaries, bonus and staff 50,787,157 48,552,914 welfare payables 218,488,770 230,556,417 -------------------- -------------------- Total equity, minority interests and liabilities 2,431,572,874 2,359,541,714 ============ ============ Approved and authorized for issue by the Board of Directors on _____________. ) ) ) Directors ) ) 16 Consolidated statement of cash flows for the year ended 31 December 2003 (Expressed in Renminbi Yuan) Note 2003 2002 Rmb Rmb Rmb Rmb Operating activities Profit from ordinary 279,547,095 255,183,375 activities before taxation Adjustments for: - Dividends income (2,163,070) （3,053,523） - Interest income (10,782,610) （6,225,334） - Loss on disposal of property, plant and equipment 7,871,889 9,370,302 - (Gain)/loss on (4,847,080) disposal of land use right - Depreciation and 96,317,233 88,904,596 amortization - Revaluation of (8,759,325) (2,309,852) investments held for trading to fair value - Provision for diminution 3,000,000 in value of investments available-for-sale - Gain on disposal of (5,281,552) (14,559,122) an investments - Share of loss/(profit) 1,230,357 1,022,072 of an associate Operating profit 357,980,017 326,485,434 before working capital changes ( carried over) 17 Consolidated statement of cash flows for the year ended 31 December 2003 (continued) (Expressed in Renminbi Yuan) Note 2003 2002 Rmb Rmb Rmb Rmb 1. Operating profit before working 357,980,017 326,485,434 capital changes (BF) 2. (Increase)/decrease in (16,465,653) 8,767,823 inventories 3. Increase in trade (47,740,339) (15,284,805) receivable 4. (Increase)/decrease in (16,629,550) 7,450,470 deposits, prepayment and other receivables 5. (Decrease)/increase (3,691,733) 27,201,201 in trade payables 6. (Increase)/decrease 11,816,351 (91,976) in accruals and other payables 7. Increase in salaries, 2,234,243 9,136,791 bonus and staff welfare payables Cash generated from 302,503,336 363,664,938 operations PRC tax paid (66,734,039) (38,136,656) Cash inflows from 235,769,297 325,528,282 operating activities (carried over) 18 Consolidated statement of cash flows for the year ended 31 December 2003 (continued) (Expressed in Renminbi Yuan) Note 2003 2002 Rmb Rmb Rmb Rmb Cash inflows from 235,769,297 325,528,282 operating activities (BF) Investing activities Investment return 2,581,973 - Interest received 10,782,610 6,225,334 Dividends received 2,163,070 3,053,523 Purchase of property, (15,868,612) (43,545,196) Plant and equipment Increase in lease (4,117,339) (24,525,456) Prepayments Increase in construction (141,294,513) (151,619,837) in progress Investment for purchaser (98,954,396) (13,622,203) Proceeds from disposal 21,213,607 114,485,833 of other investments Proceeds from disposal - 19,608,686 of land use right Proceeds from disposal 3,351,604 8,919,225 of property, plant and equipment Cash flows from (220,141,996) (81,020,091) investing activities Balance (carried over) 15,627,301 244,508,191 19 Consolidated statement of cash flows for the year ended 31 December 2003 (continued) (Expressed in Renminbi Yuan) Note 2003 2002 Rmb Rmb Rmb Rmb Balance (BF) 15,627,301 244,509,191 Financing activities Dividends paid (150,548,269) (143,379,304) Capital injection by 50,000 - minority shareholder Cash flows from (150,498,269) (143,379,304) financing activities Net (decrease)/increase (134,870,968) 101,128,887 in cash and cash equivalents Cash and cash 1,167,898,471 1,066,769,584 equivalents at 1 January Cash and cash equivalents at 31 December 18 1,033,027,503 1,167,898,471 =========== =========== 20