深华发Ａ(000020)*ST华发2005年年度报告摘要（英文版）

Stock Code: 000020, 200020 Public Notice No.: 2006-01 Short Form of the Stock: *ST Huafa A, *ST Huafa B SHENZHEN HUAFA ELECTRONICS CO., LTD. SUMMARY OF ANNUAL REPORT 2005 (Overseas Version) §1. Important Notice 1.1 Board of Directors and Board of Supervisors of SHENZHEN HUAFA ELECTRONICS CO., LTD. (hereinafter referred to as the Company) and its directors, supervisors and senior executives hereby confirm 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. 1.2 No directors, supervisors and senior executives 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 attended the Board meeting. 1.4 Shenzhen Nanfang Min- He Certified Public Accountants and Ho and Ho & Company Certified Pub lic Accountants audited the 2005 financial report of the Company and issued the standard unqualified Auditors’Report respectively. 1.5 Chairman of the Board of the Company Mr. Wu Dehua, General Manager Mr. Hu Jianping and Head of Financial Department Mr. Wang Yiqing hereby confirm that the Financial Report of Annual Report 2005 is true and complete. §2. Company Profile 2.1 Basic information Short form of the stock *ST HUAFA A, *ST HUAFA B Stock code 000020, 200020 Listed stock exchange Shenzhen Stock Exchange Registered address: 411 Bldg., Huafa North Road, Futian Registered address and office District, Shenzhen address Office address: 6th Floor, West Block, 411 Bldg., Huafa (N) Road, Futian District, Shenzhen Postcode 518031 Internet website of the Company http://www.hwafa.com E-mail E-mail: sz000020@163.net 2.2 Contact person and contact information Secretary of the Board of Representative in charge of Directors Securities Affairs Name Hu Jianping Liu Yang th 6 Floor, West Block, 411 Bldg., Huafa (N) Road, Futian District, Contact address Shenzhen 1 Telephone (86) 755-83352207 Fax (86) 755-83323169 E-mail sz000020@163.net §3. Summary of Financial Highlights and Business Highlights 3.1 Main Accounting Highlights Unit: RMB’000 Increase/decrease 2005 2004 over last year（％） Operating income 141,861 141,675 0.13% Gross profit 27,307 13,955 95.68% Income from other operating 2,903 1,598 81.66% Net cash arising from operating 24,647 6,215 296.57% activities At the end of At the end of Increase/decrease 2005 2004 over last year (%) Total assets 389,185 429,708 -9.43% Shareholders’ equity(excluding 238,859 232,237 2.85% minority interests) 3.2 Financial Indexes: Unit: RMB Increase/decrease 2005 2004 over last year (%) Net profit 0.02 -0.16 112.50% Return on equity 2.77% -19.09% 21.86% Net cash per share arising from operating 0.09 0.02 350.00% activities Increase/decrease At the end of 2005 At the end of 2004 over last year (%) Net assets per share 0.84 0.82 2.44% 3.3 Difference of the CAS and IAS √Applicable □Inapplicable Unit: RMB’000 CAS IAS Net profit 6,622.31 6,622.31 The Company is a listed company of both A-share and B-share. There existed no Explanation on difference on net profit as calculated according to CAS and IAS and relevant difference system. §4. Changes in Share Capital and Particulars about Shareholders 4.1 Statement of change in share capital Unit: share 2 Increase/decrea Before the change se of this time After the change Items (+, - ) Amount Proportion subtotal Amount Proportion I. Unlisted shares 124,925,828 44.12% 0 124,925,828 44.12% 1. Sponsors’shares 124,925,828 44.12% 0 124,925,828 44.12% Including: Domestic legal 124,925,828 44.12% 0 124,925,828 44.12% person’s shares 2. Raised legal person’s 0 0.00% 0 0 0.00% shares 3. Inner employees’shares 0 0.00% 0 0 0.00% 4. Preferred stock or 0 0.00% 0 0 0.00% others II. Listed shares 158,235,399 55.88% 0 158,235,399 55.88% 1. RMB ordinary shares 56,239,563 19.86% 0 56,239,563 19.86% 2. Domestically listed 101,995,836 36.02% 0 101,995,836 36.02% foreign shares III. Total shares 283,161,227 100.00% 0 283,161,227 100.00% 4.2 Statement of shares held by the top ten shareholders and Statement of shares held by the top ten circulating shareholders Unit: share Total number of shareholders 25,780 Particulars about shares held by the top ten shareholders Nature of Proportion of Total number Non-circulating Pledged or Name of shareholders shareholders shares held shares held shares held frozen shares State-owned Shenzhen SEG Group Co., Ltd. 22.06% 62,462,914 62,462,914 62,462,914 shareholder State-owned China Zhenhua Electronics Group Co., Ltd. 22.06% 62,462,914 62,462,914 0 shareholder SEG (Hong Kong) Co., Ltd. Other 5.85% 16,569,560 GOOD HOPE CORNER INVESTMENTS LTD Other 4.91% 13,900,000 ADVANCE FUTURE GROUP LIMITED Other 1.21% 3,432,110 YIN GANG Other 0.68% 1,911,455 BINGHUA LIU Other 0.31% 876,213 HUANG JIANWEN Other 0.27% 773,700 DBS VICKERS (HONG KONG) LTD A/C Other 0.23% 648,262 3 CLIENTS GUOTAI JUNAN SECURIES HONG KONG Other 0.22% 617,500 LIMITED Particulars about shares held the top ten circulated shareholders Shareholders’name Holding circulated shares Type SEG (Hong Kong) Co., Ltd. 16,569,560 Domestically listed foreign shares GOOD HOPE CORNET INVESTMENTS LTD 13,900,000 Domestically listed foreign shares ADVANCE FUTURE GROUP LIMITED 3,432,110 Domestically listed foreign shares YIN GANG 1,911,455 Domestically listed foreign shares BINGHUA LIU 876,213 Domestically listed foreign shares HUANG JIANWEN 773,700 Domestically listed foreign shares DBS VICKERS (HONG KONG) LTD A/C CLIENTS 648,262 Domestically listed foreign shares GUOTAI JUNAN SECURITIES HONG KONG LIMITED 617,500 Domestically listed foreign shares KGI ASIA LIMITED 602,852 Domestically listed foreign shares WANG XIAO PING 512,800 Domestically listed foreign shares SEG (Hong Kong) Co., Ltd. belongs to overseas sole subsidiary of Shenzhen SEG Group Co., Ltd. It is unknown that there existed Explanation of on the above-mentioned associate associate relationship among other shareholders nor belongs to relationship and accordant action relationship among accordant actors regulated by the Management Regulation of shareholders Information Disclosure on Change of Share Holding for Listed Companies by the Company. 4.3 Particulars about the controlling shareholders and actual controller of the Company 4.3.1 Particulars about change in the controlling shareholders and actual controller of the Company □Applicable √Inapplicable 4.3.2 Detailed information on the controlling shareholder and other actual controller Name of the controlling shareholder: Shenzhen SEG Group Co., Ltd. Legal representative: Sun Yulin Date of foundation: Aug. 23, 1984 Registered capital: RMB 1,355.42 million Business scope: Production and research of electronic products, electrical home appliances and electronic projects; undertake various electronic system project (Import and export business and exclusive commodities were conducted according to regulations); raise development funds and invest credit; technology development and information service and maintenance; high- floor sightseeing, supporting food and drink, marketplace and exhibition of SEG Plaza. State-owned Assets Supervision and Administration Commission of Shenzhen Municipal People’s Government is the first largest shareholder of Shenzhen SEG Group Co., Ltd., who holds 46.52% equity of Shenzhen SEG Group Co., Ltd.. 4.3.3 Property right and controlling relationship between the actual controller of the 4 Company and the Company is as follows: State-owned Assets Supervision and Administration Commission of Shenzhen Municipal People’ s Government 46.52% Shenzhen SEG Group Co., Ltd. 100% 22.06% SEG (Hong Kong) Co., Ltd. 5.85% Shenzhen Huafa Electronics Co., Ltd. §5. Particulars about Directors, Supervisors and Senior Executives 5.1 Particulars about changes in shares held by directors, supervisors and senior executives The total Drawing from Number payment of the Number of of Reason drawing from shareholding holding holding for Company in company or Name Title Sex Age Office term shares at the shares at changing the report the relevant Year-begin the period(RMB’ company(Yes year-end 0000) /No) Chairman of the Sep. 13, 2004- Wu Dehua Male 60 0 0 ０．００ Yes Board Sep. 13, 2007 Feng Vice Chairman of Sep. 13, 2004- Male 60 0 0 ０．００ Yes Quanbao the Board Sep. 13, 2007 Sep. 13, 2004- Che Wenshen Director Male 56 0 0 ０．００ Yes Sep. 13, 2007 Director, Deputy Mar.18, 2005- Hu Jianping General Manager, Male 43 0 0 ２４．５０ No Sep. 13, 2007 Secretary of Board Independent Sep. 13, 2004- Zhou Daozhi Male 56 0 0 ３．６０ No Director Sep. 13, 2007 Independent Sep. 13, 2004- Zhao Junrong Male 41 0 0 ３．６０ No Director Sep. 13, 2007 Independent Sep. 13, 2004- He Xiaoming Male 34 0 0 ３．６０ No Director Sep. 13, 2007 Chairman of the Sep. 13, 2004- Ye Daming Supervisory Male 60 30,433 30,433 １９．９０ No Sep. 13, 2007 Committee Sep. 13, 2004- Liu Jingju Supervisor Female 50 0 0 ０．００ Yes Sep. 13, 2007 Li Liangzhen Supervisor Male 40 Sep. 13, 2004- 0 0 １４．７０ No 5 Sep. 13, 2007 Deputy General Sep. 13, 2004- Cai Guiyong Male 57 35,545 35,545 １９．９０ No Manager Sep. 13, 2007 Deputy General Sep. 13, 2004- Sun Lei Male 40 0 0 １８．６０ No Manager Sep. 13, 2007 Total - - - - 65,978 65,978 - １０８．４０ - §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 met great difficulties due to the bad environment of operation: ① The factory of the Company suffered a lot from the power cut influenced by the nervous condition in the electricity power and energy. In order to guarantee the regular production, the Company purchased and rented generators and the production cost increased. ② The banks tightened the debt for the Company and the pressure of production finance of the Company increased influenced by the adjustment of bank policy and continuous two-year losses. ③ To a certain extent, the shortage of labor forces influenced the production in the midseason. In order to achieve the aims of making up the deficits and getting surpluses, Board of the Directors of the Company regulated its administrative team this March. After earnestly analyzing the actual situations of the Company, the administrative team after regulations formulated the plans on turning losses into profits and relevant annual budget, they were as follows and carried out with the approval of Board of Directors of the Company: adjusting the structures of main operation, emphasizing the operation scope, stabilizing the rent service and strengthening the internal management. After a series of adjustment in the second quarter, the Company entered the period of turning losses into profits in the latter half of this year, even though the Company is standing in the transition period of the share transfer, the company received no influence from it, while working of one heart and one mind in the same condition, the Company obtained net profits of 2005 amounted to RMB 6.6223 million and over-fulfilled the annual goal. The details about the operations of the Company were as follows: (1)After objective analysis to the operation and the trend of the industry of the Company, great adjustments to the main structure were taken: stop the production of color televisions, determine to take circuit boards and plastic injection hardware as the main business. The Company threw off the burden of losses completely because of stopping the production of color televisions, alleviated the basic problems of circuit board and expanded the production capacity on the plastic injection hardware because of increasing the investment on renovating and transforming the technologies on part of equipments belonged to the factories of circuit board and plastic injection hardware. (2)The Company continued to maintain the stead development of the property lease business. In the report period, good achievements on the property lease business were obtained, the lease rate reached as high as 98%, the leasing income amounted to RMB 37,990, 000, the leasing profit amounted to RMB 16,930,000, the recycling leasing amounted to 37,580,000 and the returns-ratio reached to 98.92%. (3)The Company consummated the internal management. The Company adjusted the internal organization of management and strengthened the ability of management, and 6 then the working efficiency improved obviously. While the Company trained to intensify the consciousness of whole staff, the product quality and service improved gradually. The Company revised the regulations on the inspection and the rewards and punishment, tried to impel the target management, and initially established the effectively incentive mechanism. The Company perfected the enterprise system and flow depending on the system authentication, and strictly carried on the budget controlling system. 6.2 Statement of main operations classified according to products Unit: RMB’0000 Main operations classified according to industries Income Profit ratio of Increase/decrease in Increase/decrease Increase/decrease Classified Cost of from main income from main in cost of main in profit ratio according to main main operations operations over the operations over the over the last year products operations operations (%) last year (%) last year (%) (%) Manufacture of electronic 11,442.17 10,704.86 6.45% -11.47% -16.23% 5.32% products Main operations classified according to products Circuit Board 8,262.87 7,988.55 3.32% -15.77% -17.94% 2.56% Plastic injection 2,262.25 1,646.57 27.22% 59.62% 45.98% 6.80% hardware 6.3 Particulars about main operations classified according to areas The sales of products of the Company focus on the area of South China. 6.4 Application of the raised proceeds □Applicable √Inapplicable Particulars about the changed projects □Applicable √Inapplicable 6.5 Particulars about non-raised capital projects □Applicable √Inapplicable 6.6 Explanation of the Board of Directors on the “Qualified Opinion” made by the Certified Public Accountants □Applicable √Inapplicable 6.7 The preplan on the profit distribution and capitalization of capital public reserve of the Board of Directors √Applicable □Inapplicable In 2005, the Company realized the net profits amounting to RMB 6,622,300 and all the net profits were used for offsetting the losses in the previous year, and didn’t distribute profit and convert capital public reserve into share capital. The Company did not appropriate share distribution preplan though the Company achieved the profit in the report period. √Applicable □Inapplicable The reason for that The Company did not The purpose and using plan for the appropriate share distribution preplan though non-distributed profit of the Company the Company achieved the profit in the report 7 period. Used for offsetting the losses in the previous The non-distributed profit of the Company is years nagative in the report period §7. Significant Events 7.1 Purchase of assets □Applicable √Inapplicable 7.2 Sales of assets □Applicable √Inapplicable 7.3 Significant guarantee □Applicable √Inapplicable 7.4 Significant related transactions 7.4.1 Related transactions related to the routine operation □Applicable √Inapplicable 7.4.2 Current related credits and liabilities □Applicable √Inapplicable 7.5 Entrusted assets □Applicable √Inapplicable 7.6 Implementation of commitment items 7.6.1 The Schedule for the Share Merger Reform The target date of the Share Merger Reform: the Share Merger Reform would be started up on Aug 1, 2006 Shenzhen SEG Group Co., Ltd and China Zhenhua Electronics Group Co., Ltd, non-circulating shareholders of the Company, signed Agreement for Sale & Purchase of Shares respectively with Wuhan Zhongheng High-tech Industrial (Group) Co., Ltd. dated on June 6, 2005, the Company enter into the transition period of the share transfer, which events was reported for approval at present. In the light of the above- mentioned cases, the Share Merger Reform of the Company must be dealt with through negotiation by assignor and assignee. At present, the two parties concerned communicated with each other actively and make decision of starting up the Share Merger Reform on Aug 1, 2006. 7.6.2 Other Commitments □Applicable √Inapplicable 7.7 Significant lawsuit and arbitration □Applicable √Inapplicable §8. Report of the Supervisory Committee □Applicable √Inapplicable §9. Financial Report 9.1 Auditors’opinion Auditors’opinion: standard unqualified auditor’s opinion 9.2 Financial statements 9.2.1 Consolidated balance sheet As at 31st December 2005 8 2005 2004 RMB’000 RMB’000 Assets Non-current assets Investment properties 61,983 69,533 Property, plant and equipment 201,265 203,562 Construction in progress - 2,102 Available-for-sale investment - - Total non-current assets 263,248 275,197 Current assets Inventories 30,613 38,188 Bill receivables 7,619 3,010 Trade receivables 55,307 60,574 Prepaid expenses and other current assets 15,307 17,337 Cash and cash equivalents 17,091 35,402 Total current assets 125,937 154,511 Total assets 389,185 429,708 Equity and liabilities Capital and reserves Share capital 283,161 283,161 Share premium 98,461 98,461 Property revaluation reserve 3,033 3,033 Surplus reserves 77,391 77,391 Accumulated losses (223,187) (229,809) 238,859 232,237 Current liabilities Trade payables 34,940 46,517 Accrued expenses and other current liabilities 21,286 25,954 Bank loans –repayable within one year 94,100 125,000 Total current liabilities 150,326 197,471 Total equity and liabilities 389,185 429,708 9.2.2 Consolidated income statement For the year ended 31st December 2005 2005 2004 RMB’000 RMB’000 Continuing operation Revenue 141,861 141,675 Cost of sales (114,554) (127,720) Gross profit 27,307 13,955 Other operating income 2,903 1,598 Selling expenses (2,539) (3,871) 9 Administrative expenses (8,284) (34,177) Other operating expenses (2,318) (2,707) Profit (loss) from operations 17,069 (25,202) Finance costs, net (6,682) (7,206) Profit (loss) before taxation 10,387 (32,408) Income tax expenses - - Profit (loss) for the year from continuing operation 10,387 (32,408) Discontinued operation Loss for the year from discontinued operation (3,765) (11,934) Profit (loss) for the year 6,622 (44,342) Earning (loss) per share From continuing and discontinued operations: - Basic RMB 0.0234 (RMB 0.1566) From continuing operation - Basic RMB 0.0367 (RMB 0.1145) 9.2.3 Consolidated cash flow statement For the year ended 31st December 2005 2005 2004 RMB’000 RMB’000 Operating activities Profit (loss) for the year 6,622 (44,342) Adjustments for: Bank interest income (383) (323) Bank interest expenses 6,614 7,261 Depreciation on property, plant and equipment 24,323 24,003 Impairment loss on property, plant and equipment - 266 Loss on disposal of property, plant and equipment 67 488 Construction in progress written off - 104 Provision for doubtful receivables 172 8,375 Provision for obsolesce inventories - 13,596 Operating cash flow before movements in working capital 37,415 9,428 Decrease (increase) in inventories 7,575 (6,592) Decrease in trade and other receivables 2,516 3,971 (Decrease) increase in trade and other payables (16,245) 6,669 Cash from operations 31,261 13,476 10 Interest paid (6,614) (7,261) Net cash from operating activities 24,647 6,215 Investing activities Interest received 383 323 Expenditure on acquisitions of property, plant and equipment and construction in progress (12,522) (9,683) Proceeds from disposal of property, plant and equipment 81 277 Net cash used in investing activities (12,058) (9,083) Financing activities New bank loans granted 127,320 130,000 Repayment of bank loans (158,220) (139,000) Net cash used in financing activitie s (30,900) (9,000) Decrease in cash and cash equivalents (18,311) (11,868) Cash and cash equivalents at beginning of year 35,402 47,270 Cash and cash equivalents at end of year, analysis as: Cash and bank balances 17,091 35,402 9.3 Explanation on changes of accounting policy, accounting estimation and settlement compared with the latest annual report □Applicable √Inapplicable 9.4 Contents, correct amount, reason and its influence of significant accounting errors □Applicable √Inapplicable 9.5 Explanation on change of consolidated scope compared with the latest annual report □Applicable √Inapplicable 11