SHENZHEN SPECIAL ECONOMIC ZONE REAL ESTATE &
PROPERTIES (GROUP) CO., LTD.
REPORT FOR THE FIRST QUARTER OF 2012
§1 Important Notes
1.1 The Board of Directors, the Supervisory Committee as well as directors, supervisors and senior
executives of SHENZHEN Special Economic Zone Real Estate & Properties (Group) Co., Ltd.
(hereinafter referred to as “the Company”) warrant that this report does not contain any false
information, misleading statement or material omission and will take individual and/or joint
liabilities for the factuality, accuracy and completeness of this report.
1.2 Except for the following director, all other directors attended in person the board session for
reviewing this quarterly report.
Name Position Reason for not attending the board session in person Name of proxy
Wen Li Director On a business trip Jiang Lihua
1.3 This report has not been audited by an accounting firm.
1.4 Mr. Zhou Jianguo, the company principal, Mr. Chen Maozheng, the principal of the accounting
work, and Mr. Chen Jincai, the person-in-charge of the accounting department (the accounting
principal), hereby confirm that the financial statements enclosed in this report is true and
complete.
[English translation for reference only. Should there be any discrepancy between the two versions,
the Chinese version shall prevail.]
§2 Company Profile
2.1 Main accounting data and financial indices
Unit: RMB Yuan
31 Mar. 2012 31 Dec. 2011 Increase/decrease (%)
Total assets (Yuan) 3,206,359,525.08 3,236,127,046.06 -0.92%
Owners’ equity attributable to shareholders of the
1,550,876,764.25 1,528,596,536.13 1.46%
Company (Yuan)
Share capital (share) 1,011,660,000.00 1,011,660,000.00 0.00%
Net assets per share attributable to shareholders
1.533 1.511 1.46%
of the Company (Yuan/share)
Jan.-Mar. 2012 Jan.-Mar. 2011 Increase/decrease (%)
Gross revenues (Yuan) 233,274,476.76 251,939,021.68 -7.41%
Net profit attributable to shareholders of the
22,039,543.14 23,012,982.58 -4.23%
Company (Yuan)
Net cash flows from operating activities (Yuan) -16,248,114.45 46,179,908.39 -135.18%
Net cash flows per share from operating
-0.016 0.046 -134.78%
activities (Yuan/share)
Basic EPS (Yuan/share) 0.022 0.0227 -3.08%
Diluted EPS (Yuan/share) 0.022 0.0227 -3.08%
Weighted average ROE (%) 1.43% 1.60% -0.17%
1
Weighted average ROE after deducting
1.43% 1.60% -0.17%
non-recurring gains and losses (%)
Items of non-recurring gains and losses
√Applicable □Inapplicable
Unit: RMB Yuan
Items of non-recurring gains and losses 1 Jan.-31 Mar. 2012 Notes (if applicable)
Gains and losses on disposal of non-current assets -633.60
Other non-operating incomes and expenses 30,407.23
Income tax effects -12,170.91
Total 17,602.72 -
2.2 Total number of shareholders and shares held by the top ten shareholders not subject to trading
moratorium at the end of the reporting period
Unit: share
Total number of shareholders at the end of the
86,808
reporting period
Shares held by the top ten shareholders not subject to trading moratorium
Shares not subject to trading moratorium
Full name of shareholder Type of share
held at the period-end
Shenzhen Investment Holdings Co., Ltd. 642,884,262 RMB ordinary shares
Guotai Junan Securities (Hong Kong) Limited 1,372,150 Domestically listed foreign shares
Jing Jianjun 1,242,900 RMB ordinary shares
Wang Zhongming 1,095,808 Domestically listed foreign shares
Wu Haoyuan 1,092,100 Domestically listed foreign shares
Xue Haoyuan 894,956 RMB ordinary shares
Agricultural Bank of China—China Southern
China Securities 500 Index Securities Investment 793,019 RMB ordinary shares
Fund
Guangdong Fuying Electro-Mechanical Co., Ltd 789,000 RMB ordinary shares
Xu Taiying 780,000 RMB ordinary shares
Guan Nengshao 767,600 RMB ordinary shares
§3 Significant Events
3.1 Significant changes in major accounting data, financial highlights and reasons for these changes
√Applicable □Non-applicable
1. Total profit achieved in the reporting period was RMB 29.26 million, down 7.50% year on year,
which was mainly due to a year-on-year decrease of 7.41% in operating revenue and slight increases
in selling and administrative expenses.
(1) Operating revenue was RMB 233.27 million, down 7.41% year on year, which was mainly
because Shantou Hualin Real Estate Development Co., Ltd., a subsidiary of the Company, received a
smaller income from selling Jinye Island International Garden than the same period of last year.
(2) Selling expense was RMB 2.87 million, up 47.59% year on year, which was mainly due to more
advertising input for the Guangming SPG Chuanqi Hill (previously SPG Yufu) project.
(3) Administrative expense was RMB 15.02 million, up 9.69% year on year, which was mainly due
to a bigger intermediary expenditure than the same period of last year.
(4) Financial costs were RMB 2.24 million, down 39.50% year on year, which was mainly due to
capitalization of the interest on the borrowings for the Guangming New District project.
2
2. Other comprehensive incomes were RMB 0.33 million, down 49.15% year on year, which was
mainly because foreign-currency statement translation difference decreased as the exchange rate
changed.
3. Taxes and fares payable decreased over the year-begin mainly because the Company paid the
corporate income tax for last year.
4. Net cash flows from operating activities were RMB -16.25 million, down 135.18% year on year,
which was mainly due to a year-on-year decrease of 24.79% in cash received from sale of goods and
rendering of services; and net cash flows from financing activities were RMB -62.10 million, down
156.99% year on year, which was mainly due to a year-on-year increase of 572.26% in cash paid for
loan repayment.
3.2 Progress of significant events as well as their influence and solutions
3.2.1 Non-standard audit opinion
□Applicable √Inapplicable
3.2.2 The Company provides funds for the controlling shareholder or its related parties or provides
external guarantees in violation of the prescribed procedure
□Applicable √Inapplicable
3.2.3 Significant contracts signed and executed concerning routine operation
□Applicable √Inapplicable
3.2.4 Other
√Applicable □Inapplicable
Internal control improvement progress: According to the Circular on Doing a Good Job in Internal
Control Pilot Standardization in Listed Companies in Shenzhen issued by the Shenzhen office of
CSRC, as well as its Work Plan for Implementation of Internal Control Regulations, the Company
completed internal control documents and defect searching in the first quarter of 2012. The third
stage (evaluating the effectiveness of internal control execution) is in preparation. The Company’s
internal control evaluation team will lead the work of the third stage, take into account the internal
control rectangle formulated and the defects found in the second stage, organize
cross-examinations, and work out and execute the rectification plan. The third stage is expected to
be completed within May 2012. In June 2012, the Company will summarize the work of all the
internal control improvement stages, produce a final report and perform the information disclosure
duty. The internal control self-evaluation plan of the Company will be carried out according to the
Work Plan for Implementation of Internal Control Regulations.
Since the intermediary agency had not yet been hired when the Work Plan for Implementation of
Internal Control Regulations was formulated, the actual execution might differ from the work plan
worked out by the intermediary Deloitte for the Company in terms of time. But there was no major
change, so the Company decided to proceed with the internal control standardization according to
the original plan.
3.3 Commitments made by the Company, its shareholders and actual controller
Commitments made by the Company, its directors, supervisors, senior executives, shareholders
holding over 5% of the Company’s shares, actual controller and other related parties in the reporting
period, or such commitments carried down into the reporting period
√Applicable □Inapplicable
Commitment Commitment maker Contents of the commitment Execution
(I) Shenzhen Investment Holding Co., Ltd. made the The commitments
following commitments concerning the relevant matters of mentioned in (I) and
Share reform commitment Shenzhen Investment the share merger reform of SPG: “1. The Company shall (II) were fulfilled. As
Holdings Co., Ltd. abide by the relevant laws, regulations and rules, and for the commitment
fulfill the legal commitments; 2. The Company hereby mentioned in (III), the
declares that: The promisor shall faithfully fulfill its SASAC of the State
commitments and shoulder corresponding responsibilities; Council issued on 30
3
Unless the transferee agrees to and is able to fulfill the Sept. 2006 the
commitments, the promisor shall not transfer the held Proposed Methods for
shares. 3. The Company hereby declares that: Should the Equity Incentive Plans
promisor fail to fulfill its commitments prescribed in the Carried out in
relevant documents, it shall compensate the other State-controlled Listed
shareholders for their losses caused thereupon.” (II) Companies (Domestic)
Shenzhen Investment Holdings Co., Ltd. made the (Guo-Zi-Fa-Fen-Pei
following commitment concerning share trading [2006] No. 175), of
moratorium: “The SPG shares held by it shall not be listed which the Article 9
or transferred within 12 months from the date when the stated that the target
reform plan is implemented; When the aforesaid provision shares to be granted as
reaches its mature term, the originally non-tradable shares incentives shall not b
may be listed for trading at the stock exchange, with the paid by a single
proportion of the sold amount in SPG’s total shares not shareholder holding
exceeding 5% within 12 months, as well as not exceeding state-owned shares and
10% within 24 months.” (III) Shenzhen Investment state-owned equity
Holdings Co., Ltd. made a commitment to include an interests shall not be
equity incentive plan in the share reform, selling SPG quantified with no
shares (less than 10% of the total SPG shares) held by it to consideration without
the management of the Company within three years. authorization, and as a
result, the equity
incentive plan of the
Company could not be
implemented and thus
Shenzhen Investment
Holdings Co., Ltd. was
unable to fulfill its
commitment.
Commitments made in
acquisition reports or N/A N/A N/A
reports on changes in equity
In Oct. 2009, Shenzhen Municipal SASAC sent the Letter
on Information Disclosure Affairs of SPG to Shenzhen
Commitments made in Investment Holdings Co., Ltd. and made the commitment
Shenzhen Municipal
significant assets that it shall not conduct equity transfer through agreement, Fulfilled
SASAC
restructuring assets restructuring or other matters with significant
influence on SPG (excluding shareholding reduction in the
secondary market) within 2009 and 2010.
Commitments made in
N/A N/A N/A
issuance of shares
Other commitments
(including supplementary N/A N/A N/A
ones)
3.4 Warnings of possible loss or large-margin year-on-year change of the accumulative net profit
made during the period from the beginning of the year to the end of the next reporting period
according to prediction, as well as explanations on the reasons
□Applicable √Inapplicable
3.5 Other significant events
3.5.1 Securities investments
□Applicable √Inapplicable
3.5.2 Researches, interviews and visits received in the reporting period
Main discussion and information
Time Place Way of reception Type of visitor Visitor
provided by the Company
The investor asked about the
Company’s performance in the
10 Jan. 2012 Company office By phone Individual Individual investor
year. No written materials were
provided by the Company.
The investor asked about the
13 Mar. 2012 Company office By phone Individual Individual investor disclosure date of the Company’s
annual report and the influence of
macro-control policies on its main
4
business operation. No written
materials were provided by the
Company.
3.6 Derivative investments
□Applicable √Inapplicable
3.6.1 Derivative investments held at the end of the reporting period
□Applicable √Inapplicable
§4 Attachments
4.1 Balance sheet
Prepared by SHENZHEN Special Economic Zone Real Estate & Properties (Group) Co., Ltd.
31 Mar. 2012 Unit: RMB Yuan
Closing balance Opening balance
Items
Consolidation The Company Consolidation The Company
Current Assets:
Monetary funds 253,607,356.53 112,575,752.17 333,469,243.72 153,281,158.51
Settlement reserves
Lendings to banks and other
financial institutions
Transactional financial assets
Notes receivable
Accounts receivable 17,139,658.25 4,521,173.03 19,139,800.22 4,484,384.86
Accounts paid in advance 49,563,563.07 1,658,400.00 44,871,783.45 1,664,400.00
Premiums receivable
Reinsurance premiums
receivable
Receivable reinsurance contract
reserves
Interest receivable
Dividend receivable 341,000.00 341,000.00
Other accounts receivable 51,616,670.53 331,888,152.12 46,087,935.04 305,330,386.21
Financial assets purchased
under agreements to resell
Inventories 2,180,125,797.29 1,547,178,978.75 2,132,760,206.58 1,522,326,774.87
Non-current assets due within 1
year
Other current assets
Total current assets 2,552,053,045.67 1,997,822,456.07 2,576,669,969.01 1,987,428,104.45
Non-current assets:
Entrusted loans and advances
granted
Available-for-sale financial
assets
Held-to-maturity investments
Long-term accounts receivable
Long-term equity investment 63,346,188.26 286,516,902.86 63,346,188.26 286,516,902.86
Investing property 502,989,705.30 440,321,855.13 508,001,693.51 444,953,535.87
Fixed assets 60,933,491.37 35,745,624.21 60,918,611.65 36,367,166.98
Construction in progress
5
Engineering materials
Disposal of fixed assets
Production biological assets
Oil-gas assets
Intangible assets 6,002,291.72 401,366.72 6,196,086.71 426,066.71
R&D expense
Goodwill
Long-term deferred expenses 631,569.93 231,853.80 591,264.09 245,986.35
Deferred income tax assets 20,403,232.83 6,814.20 20,403,232.83 6,814.20
Other non-current assets
Total of non-current assets 654,306,479.41 763,224,416.92 659,457,077.05 768,516,472.97
Total assets 3,206,359,525.08 2,761,046,872.99 3,236,127,046.06 2,755,944,577.42
Current liabilities:
Short-term borrowings 20,000,000.00 20,000,000.00
Borrowings from Central Bank
Customer bank deposits and
due to banks and other financial
institutions
Borrowings from banks and
other financial institutions
Transactional financial
liabilities
Notes payable
Accounts payable 104,532,326.22 18,844,767.78 109,202,474.18 18,844,767.78
Accounts received in advance 263,848,653.23 10,788,536.60 258,976,095.57 12,627,059.60
Financial assets sold for
repurchase
Handling charges and
commissions payable
Employee’s compensation
32,125,331.05 10,439,189.05 36,389,941.35 10,393,956.41
payable
Tax payable -3,872,396.47 1,304,974.47 2,969,643.65 1,636,872.67
Interest payable 16,535,277.94 16,535,277.94 16,535,277.94 16,535,277.94
Dividend payable
Other accounts payable 388,296,513.98 636,091,146.22 384,721,231.13 625,106,207.82
Reinsurance premiums payable
Insurance contract reserves
Payables for acting trading of
securities
Payables for acting
underwriting of securities
Non-current liabilities due
657,045,738.47 557,045,738.47 697,095,738.47 556,762,901.19
within 1 year
Other current liabilities
Total current liabilities 1,478,511,444.42 1,251,049,630.53 1,525,890,402.29 1,241,907,043.41
Non-current liabilities:
Long-term borrowings 294,287,831.95 294,287,831.95 299,621,374.64 299,954,211.92
Bonds payable
Long-term payables 10,834,347.88 10,308,648.22
6
Specific payables
Estimated liabilities
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities 305,122,179.83 294,287,831.95 309,930,022.86 299,954,211.92
Total liabilities 1,783,633,624.25 1,545,337,462.48 1,835,820,425.15 1,541,861,255.33
Owners’ equity (or shareholders’
equity)
Paid-up capital (or share
1,011,660,000.00 1,011,660,000.00 1,011,660,000.00 1,011,660,000.00
capital)
Capital reserves 978,244,858.10 978,244,858.10 978,244,858.10 978,244,858.10
Less: Treasury stock
Specific reserves
Surplus reserves 4,974,391.15 4,974,391.15
Provisions for general risks
Retained profits -453,929,405.75 -774,195,447.59 -475,968,948.89 -775,821,536.01
Foreign exchange difference 9,926,920.75 9,686,235.77
Total equity attributable to owners
1,550,876,764.25 1,215,709,410.51 1,528,596,536.13 1,214,083,322.09
of the Company
Minority interests -128,150,863.42 0.00 -128,289,915.22
Total owners’ equity 1,422,725,900.83 1,215,709,410.51 1,400,306,620.91 1,214,083,322.09
Total liabilities and owners’
3,206,359,525.08 2,761,046,872.99 3,236,127,046.06 2,755,944,577.42
equity
4.2 Income statement
Prepared by SHENZHEN Special Economic Zone Real Estate & Properties (Group) Co., Ltd.
Jan. - Mar. 2012 Unit: RMB Yuan
Jan.-Mar. 2012 Jan.-Mar. 2011
Items
Consolidation The Company Consolidation The Company
I. Total operating revenues 233,274,476.76 19,900,319.10 251,939,021.68 11,941,480.33
Including: Sales income 233,274,476.76 19,900,319.10 251,939,021.68 11,941,480.33
Interest income
Premium income
Handling charge and
commission income
II. Total operating cost 204,043,164.17 18,304,461.68 220,271,235.37 17,010,355.65
Including: Cost of sales 163,433,761.90 6,588,628.43 177,026,400.92 5,723,092.90
Interest expenses
Handling charge and
commission expenses
Surrenders
Net claims paid
Net amount withdrawn for
the insurance contract reserve
Expenditure on policy
dividends
Reinsurance premium
7
Taxes and associate
20,479,316.70 2,869,198.88 23,906,003.19 2,391,732.05
charges
Selling and distribution
2,870,315.82 1,130,957.22 1,944,806.84 68,314.10
expenses
Administrative expenses 15,021,988.46 7,581,086.78 13,695,142.54 5,369,671.71
Financial expenses 2,237,781.29 134,590.37 3,698,881.88 3,457,544.89
Asset impairment loss
Add: Gain/(loss) from change in
-20,348.75 -20,348.75
fair value (“-” means loss)
Gain/(loss) from investment
37,675.11 37,675.11
(“-” means loss)
Including: share of profits in
associates and joint ventures
Foreign exchange gains (“-”
means loss)
III. Business profit (“-” means
29,231,312.59 1,595,857.42 31,685,112.67 -5,051,548.96
loss)
Add: non-operating income 52,519.70 30,231.00 41,030.00
Less: non-operating expense 22,746.07 94,177.20 18,910.00
Including: loss from non-current
633.60
asset disposal
IV. Total profit (“-” means loss) 29,261,086.22 1,626,088.42 31,631,965.47 -5,070,458.96
Less: Income tax expense 7,173,858.41 8,570,881.62
V. Net profit (“-” means loss) 22,087,227.81 1,626,088.42 23,061,083.85 -5,070,458.96
Attributable to owners of the
22,039,543.14 1,626,088.42 23,012,982.58 -5,070,458.96
Company
Minority shareholders’
47,684.67 48,101.27
income
VI. Earnings per share
(I) basic earnings per share 0.022 0.0227 -0.0050
(II) diluted earnings per
0.022 0.0227 -0.0050
share
Ⅶ. Other comprehensive incomes 332,052.11 652,636.51
Ⅷ. Total comprehensive incomes 22,419,279.92 1,626,088.42 23,713,720.36 -5,070,458.96
Attributable to owners of the
22,280,228.12 1,626,088.42 23,665,619.09 -5,070,458.96
Company
Attributable to minority
139,051.80 48,101.27
shareholders
Where there were business combinations under the same control in the reporting period, the
combined parties achieved net profits of RMB 0.00 before the combinations.
4.3 Cash flow statement
Prepared by SHENZHEN Special Economic Zone Real Estate & Properties (Group) Co., Ltd.
Jan. - Mar. 2012 Unit: RMB Yuan
Jan.-Mar. 2012 Jan.-Mar. 2011
Items
Consolidation The Company Consolidation The Company
I. Cash flows from operating
activities:
Cash received from sale of 194,328,246.16 13,422,376.62 258,390,722.61 13,908,156.90
8
commodities and rendering of
service
Net increase of deposits from
customers and dues from banks
Net increase of loans from the
central bank
Net increase of funds borrowed
from other financial institutions
Cash received from premium of
original insurance contracts
Net cash received from
reinsurance business
Net increase of deposits of
policy holders and investment
fund
Net increase of disposal of
tradable financial assets
Cash received from interest,
handling charges and
commissions
Net increase of borrowings
from banks and other financial
institutions
Net increase of funds in
repurchase business
Tax refunds received
Other cash received relating to
12,532,876.45 36,250,464.28 14,628,161.69 3,562,178.97
operating activities
Subtotal of cash inflows from
206,861,122.61 49,672,840.90 273,018,884.30 17,470,335.87
operating activities
Cash paid for goods and
138,417,144.05 18,814,346.74 164,728,986.11 3,341,210.72
services
Net increase of customer
lendings and advances
Net increase of funds deposited
in the central bank and amount
due from banks
Cash for paying claims of the
original insurance contracts
Cash for paying interest,
handling charges and
commissions
Cash for paying policy
dividends
Cash paid to and for employees 27,354,326.29 7,290,944.68 20,919,947.22 5,455,441.60
Various taxes paid 34,303,027.00 4,239,863.85 20,901,550.15 3,559,606.04
Other cash payment relating to
23,034,739.72 40,466,184.15 20,288,492.43 13,728,295.76
operating activities
Subtotal of cash outflows from
223,109,237.06 70,811,339.42 226,838,975.91 26,084,554.12
operating activities
Net cash flows from operating
-16,248,114.45 -21,138,498.52 46,179,908.39 -8,614,218.25
activities
II. Cash flows from investing
activities:
Cash received from disposal of
9
investments
Cash received from return on
37,675.11 37,675.11
investments
Net cash received from disposal
of fixed assets, intangible assets 31,450.00
and other long-term assets
Net cash received from disposal
of subsidiaries or other business
units
Other cash received relating
to investing activities
Subtotal of cash inflows
69,125.11 37,675.11
from investing activities
Cash paid to acquire fixed
assets, intangible assets and other 1,426,456.00 57,048.00 1,836,941.77 24,208.77
long-term assets
Cash paid for investment 160,800.00 160,800.00
Net increase of pledged loans
Net cash paid to acquire
subsidiaries and other business
units
Other cash payments relating to
investing activities
Subtotal of cash outflows from
1,426,456.00 57,048.00 1,997,741.77 185,008.77
investing activities
Net cash flows from investing
-1,426,456.00 -57,048.00 -1,928,616.66 -147,333.66
activities
III. Cash Flows from Financing
Activities:
Cash received from capital
contributions
Including: Cash received from
minority shareholder investments
by subsidiaries
Cash received from
borrowings
Cash received from issuance
of bonds
Other cash received relating to
financing activities
Subtotal of cash inflows from
financing activities
Repayment of borrowings 45,856,539.94 5,856,539.94 6,821,261.42 5,359,567.51
Cash paid for interest
expenses and distribution of 16,240,221.24 13,653,246.80 15,341,061.15 11,861,991.44
dividends or profit
Including: dividends or profit
paid by subsidiaries to minority
shareholders
Other cash payments relating
2,000,511.20 2,000,511.20
to financing activities
Sub-total of cash outflows from
62,096,761.18 19,509,786.74 24,162,833.77 19,222,070.15
financing activities
Net cash flows from financing
-62,096,761.18 -19,509,786.74 -24,162,833.77 -19,222,070.15
activities
10
IV. Effect of foreign exchange
rate changes on cash and cash -90,555.56 -73.08 -500,698.98 -1,793.25
equivalents
V. Net increase in cash and cash
-79,861,887.19 -40,705,406.34 19,587,758.98 -27,985,415.31
equivalents
Add: Cash and cash
333,469,243.72 153,281,158.51 379,720,636.21 191,108,590.15
equivalents at the period-begin
VI. Cash and cash equivalents at
253,607,356.53 112,575,752.17 399,308,395.19 163,123,174.84
the period-end
4.4 Auditor’s report
Auditor’s opinion: un-audited
11
