Abstract of 2015 Financial Statement of ZhonghengHuafa Co., LTD.
Stock Code: 000020 200020 Public Notice No.: 2016-21
Short Form of the Stock: SHEN HUAFA-A, SHEN HUAFA- B
Shenzhen Zhongheng Huafa Co., Ltd.
Summary of Annual Report 2015
I. Important Notice
The summary is abstract from full-text of annual report, for more details of operating results, financial condition and future
development plan of the Company; investors should found in the full-text of annual report that published on media appointed by
CSRC.
Objection statement of directors, supervisors and senior executives
Name Position Content and reason
Statement
Prompt of non-standard audit opinion
□ Applicable √ Inapplicable
Profit distribution pre-plan of common stock or capitalizing of common reserves pre-plan deliberated by the Board in the reporting
period
□ Applicable √Inapplicable
The Company has no plan of cash dividends carried out, bonus issued and capitalizing of common reserves either.
Profit distribution pre-plan of preferred stock deliberated and approved by the Board in the reporting period
□Applicable □Inapplicable
Company Profile
SHEN HUAFA-A, SHEN
Short form of the stock Stock code 000020 200020
HUAFA- B
Stock exchange for listing Shenzhen Stock Exchange
Person/Way to contact Secretary of the Board Rep. of security affairs
Name Yang Bin Niu Yuxiang
33/F, DaChong Business Center Building B, 33/F, DaChong Business Center Building B,
Office address No.9678. Shen Nan Road, , Nanshan No.9678. Shen Nan Road, , Nanshan District,
District, Shenzhen. GuangDong. China. Shenzhen. GuangDong. China.
Fax. 0755-86360206 0755-86360206
Tel. 0755-86360220 0755-86360201
E-mail hwafainvestor@126.com.cn hwafainvestor@126.com.cn
II. Main business or product introduction in the reporting period
After years of development, the company has gradually formed two main businesses in industry and property
management. Among them, the industrial business mainly includes injection molding, foam pieces (light-weight
packaging materials), and complete machine production and sales of liquid crystal display, property management
business is mainly the lease of its own property.
The company's industrial business mainly provides auxiliary products and services for the home appliance
industry. With the acceleration of new urbanization process in China and upgrading and updating of household
appliance consumption, the home appliance industry will continue to maintain a relatively fast growth; the
development of home appliances and other downstream industries provides broad markets for the upstream
auxiliary products. By virtue of years of industry resources and technology accumulation, the company conforms
to the market demand and optimizes the product structure and performance, and the company's products and
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Abstract of 2015 Financial Statement of ZhonghengHuafa Co., LTD.
services have accepted by the downstream manufacturers such as Gree, Haier, TCL, etc. and possess certain
competitiveness in the industry. But it also should be noted that the current injection molding, foam pieces and
liquid crystal display business are facing fierce market competition and cost pressures, the company’s profitability
in industrial business is weaker than expectation, the company needs to further enhance the level of research and
development, develop new products, expand downstream channels and cultivate its own brand so as to further
enhance the profitability in industrial business. The transformation and upgrading of industrial business requires a
lot of financial supports.
On the other hand, the transformation and upgrading and profitability of industrial business are weaker than
expectation in recent years, under this circumstance, the company has actively developed the property
management business, liquidized the remnant assets, and carried out the decoration and investment promotion of
its own property Huafa Building, the property management business has made good profits for the company and
became an important strategic business of the company. In order to enhance the profitability, the company intends
to further strengthen the professionalism of the company's property business, explore diversified property
management model, and timely expand the scale of property lease.
III. Main accounting data and financial indexes
1. Main accounting data and financial indexes for recently three years
Whether it has retroactive adjustment or re-statement on previous accounting data for accounting policy changed and accounting
error correction or not
□Yes √ No
In RMB
2015 2014 Changes over last year 2013
Operating income 499,455,781.11 694,839,760.10 -28.12% 626,821,044.64
Net profit attributable to
-6,731,513.11 7,687,620.27 -187.56% -6,517,401.44
shareholders of the listed company
Net profit attributable to
shareholders of the listed company
-31,741,774.80 2,322,082.33 -1,466.95% -5,934,309.10
after deducting non-recurring gains
and losses
Net cash flow arising from
173,486,015.99 119,492,159.01 45.19% -69,353,440.38
operating activities
Basic earnings per share
-0.0238 0.0271 -187.82% -0.0230
(RMB/Share)
Diluted earnings per share
-0.0238 0.0271 -187.82% -0.0230
(RMB/Share)
Weighted average ROE -2.27% 2.77% -5.04% -2.35%
Changes over end of
End of 2015 End of 2014 End of 2013
last year
Total assets 1,155,089,236.67 1,162,740,984.93 -0.66% 731,348,499.86
Net assets attributable to
311,406,562.20 281,351,269.74 10.68% 273,663,649.47
shareholder of listed company
2. Quarterly main financial index
In RMB
First quarter Second quarter Third quarter Fourth quarter
Operating income 117,513,081.51 131,221,548.35 140,688,910.96 110,032,240.29
Net profit attributable to
511,851.85 13,665,459.18 5,817,241.98 -26,726,066.12
shareholders of the listed company
Net profit attributable to
shareholders of the listed company 174,494.55 -8,415,206.76 -16,478,039.21 -7,023,023.38
after deducting non-recurring gains
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Abstract of 2015 Financial Statement of ZhonghengHuafa Co., LTD.
and losses
Net cash flow arising from
-2,165,279.32 19,193,873.05 31,031,444.53 125,425,977.73
operating activities
Whether there are significant differences between the above-mentioned financial index or its total number and the relevant financial
index disclosed in the company’s quarterly report and semi-annual report
□Yes √ No
IV. Shares and shareholders
1. Particulars about common stock shareholders, preference shareholders with voting rights recovered and
top ten shareholders
In Share
Total preference
Total common Total preference
Total common shareholders with
stock shareholders
stock voting rights
shareholders at with voting
shareholders in 36,044 36,061 0 recovered at end of 0
end of last month rights recovered
reporting last month before
before annual at end of
period-end annual report
report disclosed reporting period
disclosed
Top ten shareholders
Amount of Number of shares
Full name of Nature of Proportion of pledged/frozen
Amount of restricted shares held
Shareholders shareholder shares held shares held
State of share Amount
Domestic Pledged 116,489,894
WUHAN
non-state-ow
ZHONGHENG 41.14% 116,489,894 116,489,894
ned legal Frozen 0
GROUP
person
SEG (HONG Pledged 0
Overseas
KONG) CO., 5.85% 16,569,560 0
legal person Frozen 0
LTD.
GOOD HOPE Pledged 0
CORNER Overseas
4.91% 13,900,000 0
INVESTMENT legal person Frozen 0
S LTD
CHANGJIANG Pledged 0
securities
Overseas
BROKERAGE 1.04% 2,942,449 0
legal person Frozen 0
(HONGKONG
) Co., Ltd.
Domestic Pledged 0
Xu Dongdong nature 0.60% 1,690,307 0
person Frozen 0
GUOTAI Pledged 0
JUNAN
Overseas
SECURITIES( 0.33% 934,974 0
legal person Frozen 0
HONGKONG)
LIMITED
Overseas Pledged 0
BINGHUA LIU nature 0.30% 839,013 0
person Frozen 0
Domestic Pledged 0
Wang Jianxin nature 0.23% 660,000 0
person Frozen 0
SHENWAN Pledged 0
HONGYUANG
Overseas
SECUNITIES( 0.22% 633,888 0
legal person Frozen 0
HONGKONG)
CO., LTD.
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Abstract of 2015 Financial Statement of ZhonghengHuafa Co., LTD.
Domestic Pledged 0
Zhu Ming nature 0.22% 611,348 0
person Frozen 0
Among the top ten shareholders, Wuhan Zhongheng Group neither bears associated relationship
with other shareholders, nor belongs to the consistent actor that are prescribed in Measures for the
Explanation on associated
Administration of Disclosure of Shareholder Equity Changes of Listed Companies. The Company
relationship among the
neither knew whether there exists associated relationship among the other tradable shareholders, nor
aforesaid shareholders
they belong to consistent actors that are prescribed in Measures for the Administration of Disclosure
of Shareholder Equity Changes of Listed Companies.
Explanation on involving
margin business (if N/A
applicable)
2. Total preferred stock shareholders of the Company and shares held by top ten shareholders with
preferred stock held
□ Applicable √ Inapplicable
The Company had no shareholders with preferred stock held in the reporting.
3. Property right and controlling relationships between the actual controllers of the Company and the Company
is as follows:
Li Zhongqiu
99%
Wuhan Zhongheng New Science & Technology Industrial Group Co., Ltd
41.14%
Shenzhen Zhongheng Huafa Co., Ltd.
V. Discussion and analysis by the Management Team
1. Introduction of operation in the reporting period
In 2015, the company has achieved operating income of 499,455,800 yuan, a decrease of 28.12% compared with
the same period of last year; operating profits of 33,960,300 yuan, an increase of 615.48% compared with the
same period of last year, net profits of 33,529,200 yuan, an increase of 336.14% compared with the same period
of last year.
2. Whether the main business had major change in the reporting period
□ Yes √ No
3. About the industries, products, or regions accounting for over 10% of the company’s operating income
or operating profit
√Applicable □Inapplicable
In RMB
Increase/decrease Increase/decrease Increase/decrease
Operating
Name Operating profit Gross profit ratio of operating of operating of gross profit
revenue
revenue y-o-y profit y-o-y ratio y-o-y
Display 186,838,010.48 175,126,608.78 6.27% -29.26% -29.04% -0.30%
Plastic injection
192,872,402.89 177,046,690.61 8.21% -30.01% -29.35% -0.86%
hardware
Foam 61,245,929.61 55,230,894.39 9.82% -18.64% -17.65% -1.08%
4. Whether the characteristics of management seasonal or cyclical need special attention
□ Yes √ No
5. In the reporting period, note of major changes in operating income, operating cost, total net profit
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Abstract of 2015 Financial Statement of ZhonghengHuafa Co., LTD.
attributable to common stock shareholders of listed company or composing the previous reporting period
√ Applicable □Inapplicable
Compared with the previous period, the investment income in the current period became an important part of the total net profit
attributable to common shareholders of listed companies. Themain investment income is shown as follows:
(1) Explanation on the Financing Income from T2 Class Trust Product for "CITICQianjing - Collective Trust Plan for Green
Star City Investment Fund"
CITICQianjing - Collective Trust Plan for Green Star City Investment Fund (hereinafter referred to as "CITICQianjingTrust
Plan") was founded on August 15, 2011, with a term of three (3) years. Once the trust term expires, if all or part of the trusted
property has not been converted into capital, the beneficiary shall entrust, by carte blanche, the trustee to carry out disposal and
realization of the trusted property, and the trust term may prolong for not more than one (1) year.
According to the contract agreement of T2 Class Trust Plan, the trustee,CITICTrust LLC.will carry out investment in specific
projects as agreed on in the "Trust Order Letter"issued by the trusterZhonghengHuafa Co., LTD. and ZhonghengHuafa Co.,
LTD.will assume full responsibility and risks. The expected annual return of the T2 Class Trust Unit is 12%.If the trust plan appears
risks in the operational process and cannot achieve the expected goal, such investment risks shall be undertaken by ZhonghengHuafa
Co., LTD.
The dates for distributing trust income of the T2 ClassTrust Unitabove are March 20, June 20, September 20and December 20;In
addition, the T2 Class trusted property does not undertake the remuneration of fund managers, but trust remuneration, which is
calculated based on the following formula: 0.5% of the principal of corresponding trust fund every time * Quantity of existence days
of the current settlement period for trust unit/ 360.The dates forpaying fixed compensation are the same as those for distributing trust
income.
ZhonghengHuafa Co., LTD. paid the subscription fund of RMB 50 million Yuan to CITICTrust LLC. on December 26, 2014,
and recovered the principal of RMB 50 million Yuanon September 8, 2015, and received a total of RMB42,833,333.35 Yuan,
respectively on March 20, 2015, September 7, 2015 and September 8, 2015 respectively, which was recognized as financing income.
(2) Explanation onFinancing Income from Shenzhen Vanke Financial ConsultingCo., LTD.
ZhonghengHuafa Co., LTD. paid RMB 50 million Yuan to Shenzhen Vanke Financial ConsultingCo., LTD. (hereinafter
referred as to "Vanke Consulting Company") on September 8, 2015, and recovered it on December 31, 2015, and also recognized
RMB 19.2 million Yuan, received from Vanke Consulting Company on December 31, 2015, as financing income.
ZhonghengHuafa Co., LTD. and Shenzhen Vanke Financial ConsultingCo., LTD. did not conclude a business contract hereto.。
6. Particular about suspended and delisting
□ Applicable √Inapplicable
VI. Relevant items involving financial report
1. Particulars about the changes in aspect of accounting policy, estimates and calculation method compared
with the financial report of last year
□ Applicable √Inapplicable
No particulars about the changes in aspect of accounting policy, estimates or calculation method in Period.
2. Major accounting errors within reporting period that needs retrospective restatement
□ Applicable √Inapplicable
No major accounting errors within reporting period that needs retrospective restatement for the Company in the period.
3. Compare with last year’s financial report; explain changes in consolidation statement’s scope
√Applicable □Inapplicable
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Abstract of 2015 Financial Statement of ZhonghengHuafa Co., LTD.
Compared with last year, the Company sold Yutian Henghua Company.
4. Explanation on “Qualified Opinion” from the Certified Public Accountants in the report period by the
Board of Directors and Supervisory Committee
√ Applicable □Inapplicable
1、Opinions ofthe Board of Directors
On the basis of relevant information, based on the principle of strictness and cautiousness,ShineWing Certified Public
Accountants (Special Ordinary Partnership)issued the report indicating inability to express audit opinion. The Board of Directors
expressed the understanding hereto.The Report conforms to theAuditing Standards ofCertified Public Accountants of the People's
Republic of China and other relevant laws and regulations, and cautiously reflects the Company's financial situation.The Board of
Directors will take effective measures to eliminate the influence of the abovementioned uncertainty on the Company as soon as
possible.
2、Opinions of the Board of Supervisors
The report indicating inability to express audit opinion, issued by ShineWing Certified Public Accountants (Special Ordinary
Partnership), fully reveals the Company's financial risks.We recognize the matters for which the Audit Reportis unable to express
opinions, and at the same time also agree on the special explanation made by the Board of Directors of the Company relating to these.
We hope the Board of Directors and management to take effective measures as soon as possible, to eliminate and improve the content
mentioned in thepassages for those matters unable to express opinions and to safeguard the interests of the vast investorsin a timely
manner.
3、Opinions of the Independent Directors
The explanation made by the Board of Directors of the Company on the matters related to the audit opinions is objective and true,
and in accordance with the Company's actual situation.Independent directorsagree with the special explanation made by the Board of
Directors of the Company on the matters related to the audit report indicating inability to express audit opinion issued by
ShineWing Certified Public Accountants (Special Ordinary Partnership); Independent directors hope the Board of Directors and
management toeliminate and improve the matters unable to express opinionsin an active, effective and steady manner according to the
relevant solutionset by the Board of Directorsand management, timelyperform the information disclosure according to clearing
situation, and take necessary measures to make the Company maintain sustainable, stable and healthy development, and safeguard
the interests of the company and the vast investors.
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