深纺织Ａ(000045)深纺织Ｂ2005年年度报告摘要（英文）

Stock code: 000045, 200045 Stock Abbreviation: Shen Textile A, Shen Textile B No. of Announcement: 2006-3 Summary of 2005 Annual Report of of Shenzhen Textile (Holdings) Co., Ltd. （B） §1 Important notes 1.1 The Board of Directors of the Company hereby guarantees that there are no misstatement, misleading representation or important omissions in this report and shall assume joint and several liability for the authenticity, accuracy and completeness of the contents hereof. The summary of this annual report is selected from the annual report. If investors intend to know the detailed contents, they should read the full text of the annual report. 1.2 No director declares inability to warrant or objection to the authenticity, accuracy and completeness of the content of the annual report. 1.3 List of directors failing to attend the meeting Name of director not Reason for not attending the meeting Name of proxy present Li Jingqiang Going on business trip Guan Tongke 1.4 Shenzhen Pengcheng Certified Public Accountants issued unqualified auditor's report with no explanatory notes for the Company. 1.5. Guan Tongke, the person in charge of the Company, Wang Bin, the financial controller and Liu Yi, the person in charge of accounting organ (accounting officer) represent and warrant the financial and accounting report in the annual report is true and complete. §2 Basic Information 2.1 Basic information Stock abbreviation Shen Textile A, Shen Textile B Stock code 000045, 200045 Stock exchange Shenzhen Stock Exchange for listing Registered address:6/F, Shenfang Building, No.3 Huaqiang North Road, Futian Registered address District, Shenzhen and business Business address: 6/F, Shenfang Building, No.3 Huaqiang North Road, Futian address District, Shenzhen Post code Post code of Registered address :518031 1 Post code f Business address: :518031 Website No E-mail sztext@szonline.net 2.2 Contact person and contact manner Board secretary Name Chao Jin Contact address 6/F, Shenfang Building, No.3 Huaqiang North Road, Futian District, Shenzhen Tel 83776043 Fax 83776139 E-mail cjane@mail.china.com §3 Highlights of Accounting Data and Financial Indicators 3.1 Main accounting data Unit: RMB'000 2005 (current year) Increase/decre 2004 (previous year) 2003 ase (%) Turnover 392060 448393 451965 -12.56 Before-tax 39196 44558 42200 -12.03 profit Profit for the 25555 31100 36361 -17.83 year End of 2005 (end of End of 2004 (end of End of 2003 Increase/decre current year) previous year) ase (%) 674803 680697 714932 -0.87 Total assets 363831 352983 351865 3.07 Shareholders' 26191 39883 5733 -34.33 equity Net cash 26191 39883 inflows from 5733 -34.33 operating activities 3.2 Main financial indicators Unit: RMB’000 2005 (current year) Increase/decrease 2004 (previous year) 2003 (%) Earnings per 0.104 0.127 0.148 -18.11 share Return on net 7.02 8.81 10.33 -0.20 assets Net cash 0.11 0.16 0.04 -31.25 inflows per 2 share from operating activities End of 2005 (end of End of 2004 (end of Increase/decrease current year) previous year) 2003 (%) Net assets per 1.48 1.44 2.15 2.78 share 3.3 Difference of domestic and foreign accounting standards √ Applicable□ Not applicable Unit: RMB Domestic accounting standards Overseas（international）accounting standards Net profit 21,639,239.45 25,555,000.00 Cause of difference: Adjustment made for complying with international accounting standards: Writeback of over-provision for the depreciation of real estate of investment nature 2.346 million Notes to difference The price difference of equity investment in affiliated companies need not amortization 0.689 million Amortization of intangible assets 0.785 million Income from special subsidy shared 0.096 million §4 Particulars about the Changes of Share Capital and Shareholders 4.1 Schedule of Change in Share Capital Unit: shares Increase or Before this decrease this After this change change time (+/-) Share Bonu Capit Oth Subtota allotme s alizat er l nt share ion of Proportio s com Quantit Proportio Quantity n (%) mon y n (%) reser ve fund I.Non-negotiable shares 162,360,00 66.24% 162,360, 66.24% 0 000 1.Promoter’s shares 162,360,00 66.24% 162,360, 66.24% 0 000 Including： 3 State-owned shares 162,360,00 66.24% 162,360, 66.24% 0 000 Domestic corporate shares Overseas corporate shares Other 2.Raised corporate shares 3.Staff share 4.Preferred shares or others II. Negotiable shares 1.RMB common shares 33,264,000 13.57% 33,264,0 13.57% 00 Of which : senior 100,800 0.04% 100,800 0.04% executive shares 2.Domestically listed 49,500,000 20.19% 49,500,0 20.19% foreign investments shares 00 3.Overseas listed foreign investment shares 4.Other III. Total shares 245,124,00 100% 245,124, 100% 0 000 4.2 The total number of shareholders and the statement of shareholding of the top ten shareholders holding negotiable shares Table of shareholding of the top ten shareholders Total number of 18649 shareholders at the end of the report period Particulars about the shareholding of the top ten shareholders Quantity of Quantity of Name of Nature of Shareholding Total non-negotiable pledged or shareholder shareholder ratio quantity of shares held frozen shares shares held Shenzhen State-owned Investment shareholder 66.24% 162,360,000 162,360,000 7,000,000 Management Co., Ltd. Zhuang Wenxia A 0.32% 775,000 0 0 Yang Jian A 0.27% 668,721 0 0 ICTOR ONWARD PRINTING & B 0.23% 555,000 0 0 DYEING （HK） 4 CO.LTD ABN AMRO B 0.20% 498,400 0 0 BANK NV Wang Jun A 0.17% 412,400 0 0 Xu Meijun A 0.16% 400,000 0 0 Liu Jinqun B 0.16% 400,000 0 0 DBS VICKERS （HONGKONG） B 0.16% 389,985 0 0 LTD A/C CLIENTS Zhu Qianyin A 0.14% 338,690 0 0 Particulars about the shareholding of the top ten shareholders holding negotiable shares Name of shareholder Quantity of negotiable shares Type of share held Zhuang Wenxia 775000 A Yang Jian 668721 A VICTOR ONWARD PRINTING & 555000 B DYEING （HK）CO.LTD ABN AMRO BANK NV 498400 B Wang Jun 412400 A Xu Meijun 400000 A Liu Jinqun 400000 B DBS VICKERS （HONGKONG）LTD A/C 389985 B CLIENTS Zhu Qianyin 338690 A WU，KIN YEUK 316055 B Notes to the related The Company did not know whether the above relationship between the top shareholding of the top ten Negotiable shareholders had ten shareholders or their relation. concerted action 4.3 Introduction of the controlling shareholder and actual controller 4.3.1 Change of the controlling shareholder and actual controller □Applicable√Not applicable 4.3.2 Particulars about the controlling shareholder and other actual controller The shares held by :Shenzhen Investment Holding Co., Ltd. Legal representative:Chen Hongbo, Date of establishment: October 13, 2004; Registered capital: RMB 1 billion. It is a solely state-owned company in Shenzhen. Business scope: Providing guarantee to municipal state-owned enterprises, managing state-owned equity of enterprises other than those directly supervised by Municipal State-owned Assets Commission, conducting asset reorganization, system transformation and capital operation of affiliated enterprises, making investment and doing other businesses authorized by the Municipal State-owned Assets Commission. The controlling shareholder of the Company remained unchanged in the report period. National Assets Regulatory 5 Commission of Shenzhen Municipal People's Government is the actual controller of the Company. 4.3.3 The chart of property right relationship between the Company and its actual controller: National Assets Regulatory Commission of Shenzhen Municipal People's Government │ │100% ↓ Shenzhen Investment Holding Co., Ltd. │ │66.24% ↓ Shenzhen Textile (Holdings) Co., Ltd. §5 Directors, Supervisors and Senior Executives 5.1 Change of Shareholdings of Directors, Supervisors and Senior Executives Name Title Sex Age Date of starting and ending Shares held atShares held at Receiving year-beginning year-end remuneration Whether form the receiving Reason for company in remunerati change reporting on or term subsidy (RMB’OOOO) Guan Board 44.6 No Male 582003.6.30—2006.6.29 55,800 55,800 Tongke chairman Director, Male 43.0 No Wang Bin General 36 2005.5.28—2006.6.29 0 0 Manag Li 33.7 No Director Male 532003.6.30—2006.6.29 45,000 45,000 Jingqiang Independe 5.00 Yes Yang Jichao Male 512003.6.30—2006.6.29 0 0 nt director Liu Independe 5.00 Yes Male 442003.6.30—2006.6.29 0 0 Xiangqing nt director Independe 5.00 Yes Huang Hui Male 412003.6.30—2006.6.29 0 0 nt director Chairman 37.9 No Gao Zhuofu of Male 532003.6.30—2006.6.29 0 0 Supervisor 6 y Committee Zhou Mei Superviso 28.9 No Female 482005.4.5—2006.6.29 0 0 Rong r Superviso 0.00 Yes Song Gongli Male 502005.6.29-2006.6.29 0 0 r Deputy 31.5 No Zhou Dadong Male 592003.7.30-2006.6.29 0 0 GM Deputy 29.30 No Feng Junbin Male 432003.7.30-2006.6.29 0 0 GM Deputy 28.90 No Zhu Jun Male 422003.7.30-2006.6.29 0 0 GM Deputy 16.7 No Gao Guoshi Male 522005.5.28-2006.6.29 GM Secretary 26.2 No to the Chao Jin Female 43 2003.6.30—2006.6.29 board of directors Deputy 25.3 No Liu Yi chief Male 52 2003.6.30—2006.6.29 accountant Total - - - - 100,800 100,800 361.00 - §6 Report of the Board of Directors 6.1 Discussion and analysis of the overall operation status in the report period The Company is mainly engaged in the production, import and export trade of textiles, garments and relevant products and sidelines in property lease, warehousing, real estate development, hotel business and manufacturing of optoelectronic devices. In 2005, both production and sales of the Company's high-tech products and products with high added value throve. The property occupancy rate was enhanced. Trade business was unfavorably affected by the appreciation of RMB. The income in the year was RMB 392.06 million, a year-on-year decrease of 12.56%. The net profit was RMB 25.555 million, a year-on-year decrease of 17.83% mainly due to the reduction of profit from trade business. Industry: In the report period，the income of the Company from manufacturing industry was RMB 194.9397 million, a year-on-year decrease of 0.12%. The total profit from industry was RMB 18.4318 million, a year-on-year increase of 11.63% mainly due to the strengthening of development and promotion of new products by high-tech enterprises. Trade: In the report period，the income of the Company from trade was RMB 172.2115 million, a year-on-year decrease of 22.48%. The total profit from trade was RMB 7.5918 million, a year-on-year decrease of 51.04% mainly due to the reduction of profit margin of export trade enterprises caused by textile product trade friction between China and U.S. and between China and Europe and the rise in RMB exchange rate. 7 Property lease and hotel business: The Company owns Shenfang Building and other properties including commercial stalls, factory buildings, office buildings and warehouses for lease. In the report period，the income of the Company from property lease, warehousing and hotel business was RMB 50.7794 million, a year-on-year increase of 1.23%. The total profit was RMB 9.1524 million, a year-on-year increase of 15.13% mainly due to the rise in property occupancy rate. The profitability of the Company's main operations in the report period rose over the previous report period mainly because industrial enterprises actively promoted new product sales and both production and marketing of high-tech products and products with high added value throve. The gross profit rate rose by 1.98% over the same period of the previous year. 6.2 Table of the status of key business in terms of line of business or product Unit: RMB'0000 The Status of key business in terms of line of business In terms of Increase/decre line of Income from Cost of key Income from Cost of key Increase/decrease ase of gross business or key business business key business business of cost (%) profit rate (%) product Domestic and foreign 17,221.15 16,400.23 1.05% -22.48% -19.94% -86.50% trade Manufacturi 19,317.12 15,705.89 1.23% -1.03% -2.52% -92.95% ng industry Property management 5,254.79 0.00 100.00% 4.76% 0.00% 0.00% and lease The Status of key business in terms of product business Polarizer sheet for 6,285.74 4,654.50 25.95% 21.20% 17.38% 8.99% LCD Fully-shaped knitted 3,617.53 2,575.73 28.80% 10.36% 12.14% -3.78% garment 6.3 The status of key business in terms of areas Unit: RMB'0000 Area Income from key business Increase/decrease of income (%) National business 17,787.97 -32.35% Foreign business 24,005.09 17.36% Industrial elimination -2,587.03 6.4 Raised funds use □applicable√not applicable Change Item □applicable√not applicable 8 6.5 Investment projects utilizing non-raised funds: √applicable□not applicable Unit:RMB’0000 Project name Project amount Project progress Income from project Phase-II polarizer 2,474.50 100% 0 sheet project Total 2,474.50 - - 6.6 Explanation of the board of directors to the "nonstandard opinions" □ applicable√ not applicable 6.7 The preplan of the board of directors for profit distribution or capitalization of capital common reserve fund √ applicable □not applicable As required in the articles of association of the Company, the Company is to appropriate 10% and 5% of its net profit for 2005 (RMB 22,645,372.05), i.e., RMB 2,264,537.20and RMB 1,132,268.60, respectively for statutory common reserve fund and statutory public welfare fund. With the existing total share capital of the Company, i.e., 245,124,000 shares, as the base, the Company is to pay dividend of RMB 0.5 (including tax) to all shareholders for every 10 shares. RMB 12,256,200.0 is to be distributed in total. The remaining undistributed profit of RMB 5,986,233.65 is to be carried forward to the next year. The Company is not to capitalize its capital surplus. The Company made profit in the report period but did not make cash profit distribution preplan. □ applicable√ not applicable §7 Important Events 7.1 Asset acquisition □ Applicable√ Not applicable 7.2 Disposal of assets □ Applicable√ Not applicable 7.3 Material guarantee √Applicable□ Not applicable Unit: (RMB’0000) Guarantees provided by the Company (not including the guarantees provided to controlled subsidiaries) Name of Date of guarantee Whether provided Amount of Type of Guarantee Whether object of creation (Date of to related parties guarantee guarantee period terminated guarantee agreement signing) (Yes or no) 9 Shenzhen Beauty Joint liability Century July 16, 2005 1,000.00 1 year No No guarantee Garment Co., Ltd. Total amount of guarantee in the report 1,000.00 period Total balance of guarantee at the end of the 1,000.00 report period Guarantees provided by the Company to its controlled subsidiaries Total amount of guarantees provided to 1,000.00 controlled subsidiaries in the report period Total balance of guarantees provided to controlled subsidiaries at the end of the report 0.00 period Total amount of guarantees provided by the Company (including the guarantees provided to controlled subsidiaries) Total amount of guarantee 1,000.00 The proportion of the total amount of 2.91% guarantees to the net assets of the Company Of which: Guarantees provided by the Company in violation of regulations The amount of guarantee provided to shareholders, actual controller and its related 0.00 parties The amount of debt guarantees directly or indirectly provided to the object of guarantee 0.00 whose assets-liabilities ratio exceeds 70% The amount of guarantee that exceeds 50% of net assets Total amount of the above three guarantees 0.00 7.4 Particulars of related transactions 7.4.1 Related sales and purchases √applicable□not applicable Unit: RMB million Sales of products and rendering of services to Purchases of products and acceptance of services related parties from related parties The proportion of Related party The proportion of transaction Transaction transaction amount to total Transaction amount to total amount of amount amount of similar amount similar transactions transactions Shenzhen 1,576.82 8.16% 0.00 0.00% 10 Tianlong Industrial and Trading Co., Ltd. Total 1,576.82 8.16% 0.00 0.00% Of which: The total amount of product sales or rendering of services of the Company to its controlling shareholder and subsidiaries was RMB0.00 million in the report period. 7.4.2 Related creditor's rights and debts √applicable□not applicable Unit: RMB 0000 Financing of related party to the Financing to related party Company Related party Transaction Transaction Balance Balance amount amount Shenzhen Shenhu Knitting 0.00 267.46 0.00 0.00% Co., Ltd. Shenzhen Xiangjiang -19.00 19.00 0.00 0.00% Leather Product Co., Ltd. Hong Kong Yehui -231.00 0.00 0.00% 0.00% International Co., Ltd. Total -250.00 286.46 0.00% 0.00% Of which: The Company provided funds of RMB 0.00 million to its controlling shareholder and subsidiaries in the report period. The balance of the funds provided by the Company to them was RMB 0.00 million. The capital occupation and refundment □applicable√not applicable Whether the debt settlement plan can ensure the thorough settlement of fund occupation problem before the end of 2006 □applicable√not applicable 7.5 Entrusted asset management □ Applicable □√ Not applicable 7.6 Performance of commitments □ Applicable√ Not applicable 7.6.1 Schedule of share holding structure reform Shenzhen Investment Holding Co., Ltd., the shareholder holding non-negotiable shares of the Company, promised to start the share holding structure reform of the Company before June 30, 2006. 11 7.6.2 Other Commitments □applicable√not applicable 7.7 Significant litigation or arbitration □applicable√not applicable §8 Report of the Supervisory Committee √ applicable□ not applicable In the report period，the supervisory committee of the Company duly performed its supervision duties and carried out effective supervision strictly according to the provisions of the Company Law and the Articles of Association of the Company. I. The meetings of the supervisory committee in the report period 1. On April 16, 2005, the 8th meeting of the third supervisory committee examined and adopted the report of the Company for 2004 and its summary, final accounting report, profit distribution preplan and the report for the first quarter. It adopted the work report of the supervisory committee for 2004 and the proposal for nominating Mr. Song Gongli as the candidate for supervisor of the supervisory committee of the Company and submitted it to 2004 annual shareholders' general meeting of the Company for examination. 2. On May 27, 2005, the 9th meeting of the third supervisory committee examined and comprehensively revised the rules of procedure of the supervisory committee of the Company and submitted it to the shareholders' general meeting of the Company for examination. 3. On October 26, 2005, the 10th meeting of the third supervisory committee examined and adopted 2005 semiannual report of the Company and its summary and the profit distribution plan of the Company for the first half of 2005. 4. On December 24, 2004, the 11th meeting of the third supervisory committee examined and adopted the report for the third quarter of 2005. II. Opinions of the supervisory committee on other matters 1.The operation of the Company according to law: In the report year, the members of the supervisory committee attended all board meetings of the Company as nonvoting delegates. In the opinion of the supervisory committee, the Company constantly improved and implemented internal control system, the decision-making procedures were standardized and legal, the directors and members of the management of the Company worked diligently and practiced self discipline and no act of violating laws and regulations or the Articles of Association of the Company or harming the interests of the Company. 2. The inspection of the financial affair of the Company: The supervisory committee held the opinion that the Company strictly implemented national finance laws and regulations and its financial statements completely and truly reflected the Company's financial position and operating 12 results. The audit body issued unqualified auditors' report for the Company. 3. The Company neither raised funds nor was involved in acquisition activities in the report period. 4. The related transactions of the Company had small volume and were carried out according to the principle of fairness in the report period. §9 Financial Report 9.1 Audit opinions Audit opinions: Standard unqualified audit opinions 9.2 Financial Statements Shenzhen Textile (Holdings) Co., Ltd. Consolidated income statement for the year ended December 31, 2005 2005 2004 Notes RMB’000 RMB’000 Turnover (5) 392,060 448,393 Cost of sales ( 296,232 ) ( 348,398 ) Gross profit 95,828 99,995 Other revenue (7) 2,542 3,870 Other net income (8) 1,099 3,809 Income from investments (9) 1,974 3,880 Distribution costs ( 17,306 ) ( 18,117 ) Administrative expenses ( 38,516 ) ( 37,362 ) Other operating expenses ( ) ( 6,305 ) Operating profit 43,586 49,770 Share of profit from associates 2,038 1,913 Finance costs (10) ( 6,428 ) ( 7,125 ) Profit before taxation (11) 39,196 44,558 Income tax (12) ( 4,479 ) ( 4,774 ) Profit for the year 34,717 39,784 Attributable to: Equity holders of the parent 25,555 31,100 Share of profit for minority interests 9,162 8,684 Profit attributable to shareholders 34,717 39,784 Profit per share to equity holders of the parent - basic (13) RMB0.104 RMB0.127 13 Shenzhen Textile (Holdings) Co., Ltd. Consolidated balance sheet as at December 31, 2005 2005 2004 Notes RMB’000 RMB’000 Assets Non-current assets Property, plant and equipment (14) 207,591 214,623 Investment properties (15) 101,372 101,372 Land use rights - non-current portion (16) 3,394 761 Construction-in-progress (17) 41,846 18,470 Intangible assets (18) 31 34 Interests in associates (19) 45,986 43,697 Other investments (20) 41,771 45,193 441,991 424,150 Current assets Land use rights - current portion (16) 535 215 Inventories (21) 58,440 55,161 Accounts receivable (22) 50,874 36,931 Bills receivable 1,345 - Prepayments, deposits and others receivable (23) 49,673 40,236 Investments in securities (24) 1,641 2,744 Cash and bank balances 70,304 121,260 232,812 256,547 Total assets 674,803 680,697 Shenzhen Textile (Holdings) Co., Ltd. Consolidated balance sheet as at December 31, 2005 (cont’d) 2005 2004 Notes RMB’000 RMB’000 Equity and liabilities Capital and reserves Share capital (25) 245,124 245,124 Reserves 118,707 107,859 Equity attributable to equity holders of the parent 363,831 352,983 Minority interests (26) 95,654 89,590 Total equity Non-current liability Long-term loans, non-current portion (27) 4,000 4,200 14 Current liabilities Long-term loans, current portion (27) 78,670 101,323 Accounts payable 28,033 22,642 Others payable and accrued expenses 86,318 88,510 Dividend payable (28) 15,910 18,483 Provision for taxation 2,387 2,966 211,318 233,924 Total equity and liabilities 674,803 680,697 Shenzhen Textile (Holdings) Co., Ltd. Consolidated cash flow statement for the year ended December 31, 2005 2005 2004 RMB’000 RMB’000 Cash flow from operating activities Operating profit before taxation 39,196 44,558 Adjustment items : Depreciation and amortization 17,412 20,658 (Profit)/loss on disposal of property, plant and equipment 88 ( 509 ) Profit from changes in equity interest of existing ‘ subsidiaries - ( 444 ) Share of profit from associates ( 2,038 ) ( 1,913 ) Profit on disposal of investments in securities ( 16 ) ( 779 ) Provision for impairment loss - unconsolidated subsidiaries 44 1,421 - investments in securities 83 163 Provision for diminution in value of inventories 63 55 Provision for doubtful debts made/(reversed) 809 ( 1,079 ) Amortization of negative goodwill - ( 567 ) Interest income ( 2,093 ) ( 2,553 ) Interest expense 5,461 6,456 Net operating cash inflow before movements ‘ in working capital 59,009 65,467 Increase in inventories ( 3,342 ) ( 16,463 ) Increase in accounts receivable ( 14,752 ) ( 12,683 ) Increase in bills receivable ( 1,345 ) - (Increase)/decrease in prepayments, deposits and ‘ others receivable ( 6,059 ) 43,171 Increase in accounts payable 5,391 5,093 Decrease in others payable and accrued expenses ( 1,809 ) ( 31,653 ) Cash inflow from operating activities before interest ‘ and tax payments 37,093 52,932 Income tax paid ( 5,058 ) ( 6,349 ) Interest paid ( 5,844 ) ( 6,700 ) Net cash inflow from operating activities c/f 26,191 39,883 15 Shenzhen Textile (Holdings) Co., Ltd. Consolidated cash flow statement for the year ended December 31, 2005 (cont’d) 2005 2004 Notes RMB’000 RMB’000 Net cash inflow from operating activities b/f 26,191 39,883 Investing activities Interest received 2,093 2,553 Purchases of property, plant and equipment ( 6,875 ) ( 23,772 ) Purchases of land use rights ( 3,488 ) - Increase in construction-in-progress ( 28,331 ) ( 10,563 ) Proceeds from disposal of property, plant and equipment 100 6,135 Proceeds from disposal on construction-in-progress 1,800 - Returns from associates received 2,314 2,248 (Increase)/decrease in amounts due from associates ( 1,832 ) 2,151 Decrease in amounts due to associates ( 733 ) ( 710 ) Increase in other investments - ( 1,880 ) Proceeds from disposal of other investments and ‘ investments in securities 2,652 22,814 Increase in investments in securities ( 1,616 ) ( 1,136 ) Net cash outflow from investing activities ( 33,916 ) ( 2,160 ) Net cash inflow/(outflow) before financing activities ( 7,725 ) 37,723 Financing activities Dividend paid ( 17,280 ) ( 29,415 ) Decrease in bank and other loans (29) ( 22,853 ) ( 17,777 ) Increase/(decrease) in minority interests (29) ( 3,098 ) 2,563 Net cash outflow from financing activities ( 43,231 ) ( 44,629 ) Decrease in cash and cash equivalents ( 50,956 ) ( 6,906 ) Cash and cash equivalents as at beginning of the year 121,260 128,166 Cash and cash equivalents as at end of the year 70,304 121,260 Cash and cash equivalents as at end of the year ‘ are represented by : Cash and bank balances 70,304 121,260 9.3 Compared with the annual report of the previous year, the change of accounting policies and accounting estimate and the correction of accounting errors did not occur in this report period. □ applicable√ not applicable 9.4 Content of significant accounting, amount of correction, reasons and its influence □ applicable√ not applicable 9.5 The consolidation scope of this report period remained unchanged compared with the annual report of the previous year. □ applicable√ not applicable The Board of Directors of Shenzhen Textile (Holdings) Co., Ltd. April 11, 2006 16