Shenzhen International Enterprise Co., Ltd.
The First Quarterly Report 2011
§1 Important Notes
1.1 The Board of Directors, the Supervisory Committee, as well as directors,
supervisors and senior executives of Shenzhen International Enterprise Co., Ltd.
(hereinafter referred to as the Company) warrant that this report does not contain any
false or misleading statements or omit any material facts, and will take all
responsibilities, individual and joint for the authenticity, accuracy and completeness
of the report.
1.2 All directors attended the Board meeting in person and reviewed and examined
the first quarterly report 2011 except the following directors.
Name Office title Reason Name of assignee
Xie Ruxuan Independent director Business trip Sun Changxing
1.3 The first quarterly financial report has not been audited.
1.4 Mr. Zheng Kanghao, the company principal, and Ms. Xu Xiaoyun, the principal of
the accounting work and the person-in-charge of the accounting department (the
accounting principal), hereby confirm that the financial statements enclosed in the
quarterly report are factual 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 indexes
Unit: RMB Yuan
31 Mar. 2011 31 Dec. 2010 Increase/decrease (%)
Total assets (Yuan) 1,529,430,497.68 1,540,732,957.65 -0.73%
Owners’ equity attributable to shareholders of the
45,508,926.32 53,890,847.47 -15.55%
Company (Yuan)
Share capital (share) 220,901,184.00 220,901,184.00 0.00%
Net assets per share attributable to shareholders
0.21 0.24 -12.50%
of the Company (Yuan/share)
Jan.-Mar. 2011 Jan.-Mar. 2010 Increase/decrease (%)
Gross revenue (Yuan) 3,328,792.47 2,549,889.36 30.55%
Net profit attributable to shareholders of the
-8,381,921.15 -10,885,736.38 -23.00%
Company (Yuan)
Net cash flows from operating activities (Yuan) -56,743,525.95 29,071,436.22 -295.19%
Net cash flows per share from operating
-0.26 0.13 -300.00%
activities (Yuan/share)
Basic EPS (Yuan/share) -0.04 -0.05 -20.00%
Diluted EPS (Yuan/share) -0.04 -0.05 -20.00%
Weighted average ROE (%) -16.87% -4.87% -12.00%
Weighted average ROE after deducting
-17.06% -4.05% -13.01%
non-recurring gains and losses (%)
Items of non-recurring gains and losses
√Applicable □Inapplicable
Unit: RMB Yuan
Items of non-recurring gains and losses Amount Notes (if applicable)
Other than the above operating income and expenses... 147,115.10
The amount of minority interests -60,115.37
Total 86,999.73 -
2.2 Total number of shareholders as at the end of reporting period and shares held by
the top ten shareholders not subject to trading moratorium
Total number of shareholders at the end of the
14,494
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
Multi Profit Asia Pacific Investment Ltd 30,264,192 Domestically listed foreign shares
Shenzhen Special Economic Zone Development
20,842,257 RMB ordinary shares
(Group) Co., Ltd.
UOB Investment (China) Limited 15,528,941 Domestically listed foreign shares
Shenzhen Maoye Emporium Ltd 13,577,548 RMB ordinary shares
Zhong Zhiqiang 8,215,594 Domestically listed foreign shares
Guoyuan Securities (HK) Co., Ltd. 4,055,090 Domestically listed foreign shares
Chen Qiaoling 3,109,255 RMB ordinary shares
Zhou Di 3,002,167 RMB ordinary shares
Fang Ruiping 2,534,800 RMB ordinary shares
Chen Shaolan 2,528,341 RMB ordinary shares
§3 Significant Events
3.1 Particulars about large-margin change in items of the main accounting statement
and financial index, as well as the reason
√Applicable □Inapplicable
(1) Monetary funds were down 34% as compared to the end of last year, which was
mainly because the Company paid for decoration of the IA Mall.
(2) Prepayments were up RMB 36,373,940.04 as compared to the end of last year,
which was mainly because the Company paid for decoration of the IA Mall.
(3) Accounts received in advance were up 40% as compared to the end of last year,
which was mainly because the Company received some equity transfer payments in
advance.
(4) Payroll payable was down 49% as compared to the end of last year, which was
mainly due to payroll payments.
(5) Operating revenue was up 31% from a year earlier, which was mainly due to
increase of the property management fee income.
(6) No selling expense was incurred in the reporting period, representing a
year-on-year decrease of 100%, which was mainly because there were no selling
activities in the reporting period.
(7) Administrative expense was up 61% from a year earlier, which was mainly due to
increase of payroll payments.
(8) Impairment of assets increase of 125% over last year, mainly to increase bad debts
(9) Non-business income was up 526% from a year earlier, which was mainly due to
receipt of some compensations.
(10) Non-business expense was down 89% from a year earlier, which was mainly due
to decrease of contract breach damages paid.
(11) Current interest payable 124% increase over last year, mainly accrued interest on
borrowings
(12) Interest expense less than a year earlier by 42%, mainly due to reduced interest
expense.
3.2 Progress of significant events as well as their influence and solutions
3.2.1 Non-standard audit opinion
√Applicable □Inapplicable
2010 was a year when significant changes happened to the Company. Shareholding
restructuring and reelection of the Board of Directors were all accomplished by the
Company. The Company drew up and clearly defined new development strategy of
developing commercial real estate and engaging in business operation after having
established the new Board of Directors. Due to that the Company is still at the
transition period and has exited traditional retail and merchandise industry, and the
large-scale shopping mall project vigorously developed by the Company is still at the
input stage, no income has yet been generated. Meanwhile, only some wood resources
entered the cutting and realization stage. The Company still had a shortage of cash
flows.
In 2011, under the guidance of the new strategic planning, the Company has taken
various measures to proactively improve its going-concern ability, including
accelerating the shopping mall project, promoting realization of woods, activating
reserve assets and looking for financing through multiple channels.
1. The Company will beef up the shopping mall project in the business district,
thoroughly carry out fine decoration and business solicitation for the IA Mall, and try
to open the mall for business within the year. As the IA Mall project starts to attract
investors, the Company will receive rent incomes, which can ease the cash flow
stress.
2. The Company will further optimize the plan for woods realization and carry on
with the cutting and selling of fast-growing eucalyptus woods, which will generate
cash inflows for the Company.
3. The Company will actively promote to vitalize the assets of land in Bantian.
4. The Company will continue to negotiate with various commercial banks on
financing and try to obtain operating loans for commercial properties as soon as
possible.
5. The Company will continue to discuss with employees to gradually address
problems left over from the past, for instance, employees’ shops. As these problems
are addressed and the main business recovers gradually, the Company will enter a
track of positive development.
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
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 Contents of commitment Execution
maker
Commitments concerning
- Naught N/A
the share reform
The obligor for information disclosure shall not reduce
Commitments made in the the shares of Multi Profit Asia Pacific Investment Ltd.
Zheng Strictly fulfilled the
Acquisition Report or the held the obligor from this acquisition or reduce the
Kanghao commitments
Report on Equity Changes shares of SZIEC indirectly held by the obligor from this
acquisition within the future 60 months.
Commitments made in
significant asset - Naught N/A
reorganization
Commitments made when
- Naught N/A
issuing shares
Other commitments
(including supplementary - Naught N/A
ones)
3.4 Warnings of possible losses or major changes of the accumulative net profit
achieved during the period from the beginning of the year to the end of the next
reporting period compared with the same period of last year according to prediction,
as well as the reasons
□Applicable √Inapplicable
3.5 Other significant events
3.5.1 Securities investment
□Applicable √Inapplicable
3.5.2 Research, communication and interviews received in the reporting period
Main discussion and information
Time Place Way of reception Visitor
provided by the Company
Zhou Di and Li Progress of the project and business
27 Jan. 2011 44F of the Trade Center Field research
Qiang (shareholders) solicitation
Business Center of the IA Xia Tian from Progress of the project and business
16 Feb. 2011 Field research
Mall Securities Times solicitation
3.6 Investment on derivative products
□Applicable √Inapplicable
3.6.1 Derivative products held as at the end of the reporting period
□Applicable √Inapplicable
§4 Attachments
4.1 Balance Sheet
Prepared by Shenzhen International Enterprise Co., Ltd Unit: RMB Yuan
31 Mar. 2011
Closing balance Opening balance
Items
Consolidation The Company Consolidation The Company
Current Assets:
Monetary funds 101,572,865.89 383,385.42 153,356,391.84 360,786.67
Settlement reserves
Lendings to banks and other
financial institutions
Transactional financial assets
Notes receivable
Accounts receivable 1,294,452.62 1,275,452.62
Accounts paid in advance 36,547,052.04 173,112.00
Premiums receivable
Reinsurance premiums
receivable
Receivable reinsurance contract
reserves
Interest receivable
Dividend receivable
Other accounts receivable 4,969,183.37 78,036,754.82 3,990,327.14 64,562,300.84
Financial assets purchased
under agreements to resell
Inventories 1,299,737,031.87 1,295,921,630.89
Of which: Consumptive
biological assets
Non-current assets due within 1
year
Other current assets 1,444,120,585.79 78,420,140.24 1,454,716,914.49 64,923,087.51
Total current assets 1,444,270,246.25 78,420,140.24 1,454,716,914.49 64,923,087.51
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 5,699,905.49 65,073,896.52 5,699,905.49 65,073,896.52
Investing property 1,151,060.68 829,709.96 1,168,880.14 840,131.87
Fixed assets 52,105,110.31 4,515,817.40 52,778,422.12 4,738,121.88
Construction in progress
Engineering materials
Disposal of fixed assets
Production biological assets
Oil-gas assets
Intangible assets 26,248,835.41 26,248,835.41
R&D expense
Goodwill
Long-term deferred expenses 105,000.00 120,000.00 120,000.00 120,000.00
Deferred income tax assets
Other non-current assets
Total of non-current assets 85,309,911.89 70,539,423.88 86,016,043.16 70,772,150.27
Total assets 1,529,430,497.68 148,959,564.12 1,540,732,957.65 135,695,237.78
Current liabilities:
Short-term borrowings 1,300,000,000.00 1,300,000,000.00
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 40,809,564.87 45,178,810.77
Accounts received in advance 45,185,622.12 10,820,000.00 32,310,622.12 70,000.00
Financial assets sold for
repurchase
Handling charges and
commissions payable
Employee’s compensation
2,061,101.23 815,233.14 4,059,693.09 1,820,873.54
payable
Tax payable 3,582,524.03 4,080,097.61 3,500,382.04 3,987,373.26
Interest payable 8,933,031.60 3,981,587.16
Dividend payable 5,127,701.36 5,127,701.36 5,127,701.36 5,127,701.36
Other accounts payable 169,832,760.69 49,268,513.07 177,632,900.99 46,548,513.07
Reinsurance premiums payable
Insurance contract reserves
Payables for acting trading of
securities
Payables for acting
underwriting of securities
Non-current liabilities due
16,020,000.00 16,590,000.00
within 1 year
Other current liabilities
Total current liabilities 1,591,552,305.90 70,111,545.18 1,588,381,697.53 57,554,461.23
Non-current liabilities:
Long-term borrowings 35,000,000.00 35,000,000.00
Bonds payable
Long-term payables
Specific payables
Estimated liabilities 66,839,317.32 66,839,317.32
Deferred income tax liabilities
Deferred income
Other non-current liabilities 457,509.92 560,438.13
Total non-current liabilities 102,296,827.24 102,399,755.45
Total liabilities 1,693,849,133.14 70,111,545.18 1,690,781,452.98 57,554,461.23
Owners’ equity (or shareholders’
equity)
Paid-up capital (or share
220,901,184.00 220,901,184.00 220,901,184.00 220,901,184.00
capital)
Capital reserves 72,315,347.06 64,951,444.59 72,315,347.06 64,951,444.59
Less: Treasury stock
Specific reserves
Surplus reserves 125,929,834.48 96,841,026.39 125,929,834.48 96,841,026.39
Provisions for general risks
Retained profits -373,637,439.22 -303,845,636.04 -365,255,518.07 -304,552,878.43
Foreign exchange difference
Total equity attributable to owners
45,508,926.32 78,848,018.94 53,890,847.47 78,140,776.55
of the Company
Minority interests -209,927,561.78 -203,939,342.80
Total owners’ equity -164,418,635.46 78,848,018.94 -150,048,495.33 78,140,776.55
Total liabilities and owners’
1,529,430,497.68 148,959,564.12 1,540,732,957.65 135,695,237.78
equity
4.2 Income statement
Prepared by Shenzhen International Enterprise Co., Ltd Unit: RMB Yuan
Jan.-Mar. 2011
Jan.-Mar. 2011 Jan.-Mar. 2010
Items
Consolidation The Company Consolidation The Company
I. Total operating revenues 3,328,792.47 22,271.10 2,549,889.36 34,700.00
Including: Sales income 3,328,792.47 22,271.10 2,549,889.36 34,700.00
Interest income
Premium income
Handling charge and
commission income
II. Total operating cost 17,846,047.70 -689,312.16 17,505,286.54 16,022,815.33
Including: Cost of sales 3,169,829.86 4,172.85 2,849,103.06 1,807.87
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
Taxes and associate
156,880.54 246,798.80
charges
Selling and distribution
143,602.74
expenses
Administrative expenses 9,700,352.93 4,457,959.02 6,029,731.18 3,107,131.31
Financial expenses 4,767,360.36 -5,151,444.03 8,213,096.23 -4,451,589.49
Asset impairment loss 51,624.01 22,954.53 17,365,465.64
Add: Gain/(loss) from change in
fair value (“-” means loss)
Gain/(loss) from investment
(“-” means loss)
Including: share of profits in
associates and joint ventures
Foreign exchange gains (“-”
means loss)
III. Business profit (“-” means
-14,517,255.23 711,583.26 -14,955,397.18 -15,988,115.33
loss)
Add: non-operating income 551,170.45 88,040.00
Less: non-operating expense 404,055.35 3,150.71 3,684,128.94 375,001.04
Including: loss from non-current
21,204.01 6,858.89
asset disposal
IV. Total profit (“-” means loss) -14,370,140.13 708,432.55 -18,551,486.12 -16,363,116.37
Less: Income tax expense
V. Net profit (“-” means loss) -14,370,140.13 708,432.55 -18,551,486.12 -16,363,116.37
Attributable to owners of the
-8,381,921.15 708,432.55 -10,885,736.38 -16,363,116.37
Company
Minority shareholders’
-5,988,218.98 -7,665,749.74
income
VI. Earnings per share
(I) basic earnings per share -0.04 0.00 -0.05
(II) diluted earnings per
-0.04 0.00 -0.05
share
Ⅶ. Other comprehensive incomes
Ⅷ. Total comprehensive incomes -14,370,140.13 708,432.55 -18,551,486.12 -16,363,116.37
Attributable to owners of the
-8,381,921.15 708,432.55 -10,885,736.38 -16,363,116.37
Company
Attributable to minority
-5,988,218.98 -7,665,749.74
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 International Enterprise Co., Ltd Unit: RMB Yuan
Jan.-Mar. 2011
Jan.-Mar. 2011 Jan.-Mar. 2010
Items
Consolidation The Company Consolidation The Company
I. Cash flows from operating
activities:
Cash received from sale of
commodities and rendering of 5,453,792.47 22,271.10 3,142,634.55 34,700.00
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
2,720,000.00 2,720,000.00 94,404,552.37 10,929,471.31
operating activities
Subtotal of cash inflows from
8,173,792.47 2,742,271.10 97,547,186.92 10,964,171.31
operating activities
Cash paid for goods and
44,558,586.92 56,554,686.89
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 7,090,874.96 2,645,738.30 4,681,731.67 1,402,339.10
Various taxes paid 789,646.86 354,074.37 942,615.73 172,022.63
Other cash payment relating to 12,478,209.68 10,362,021.07 6,296,716.41 9,069,881.91
operating activities
Subtotal of cash outflows from
64,917,318.42 13,361,833.74 68,475,750.70 10,644,243.64
operating activities
Net cash flows from operating
-56,743,525.95 -10,619,562.64 29,071,436.22 319,927.67
activities
II. Cash flows from investing
activities:
Cash received from disposal of
10,750,000.00 10,750,000.00
investments
Cash received from return on
investments
Net cash received from disposal
of fixed assets, intangible assets 2,872,765.00 2,870,765.00
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
10,750,000.00 10,750,000.00 2,872,765.00 2,870,765.00
from investing activities
Cash paid to acquire fixed
assets, intangible assets and other 87,529.00 28,764.00
long-term assets
Cash paid for investment
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
87,529.00 28,764.00
investing activities
Net cash flows from investing
10,750,000.00 10,750,000.00 2,785,236.00 2,842,001.00
activities
III. Cash flows from financing
activities:
Cash received from capital
contributions
Including: Cash received from
minority shareholder investments
by subsidiaries
Cash received from
15,000,000.00
borrowings
Cash received from issuance
of bonds
Other cash received relating to
270,000.00
financing activities
Subtotal of cash inflows from
15,270,000.00
financing activities
Repayment of borrowings 5,220,000.00 31,000,000.00
Cash paid for interest
expenses and distribution of 570,000.00 6,235,905.45
dividends or profit
Including: dividends or profit
paid by subsidiaries to minority
shareholders
Other cash payments relating
to financing activities
Sub-total of cash outflows from
5,790,000.00 37,235,905.45
financing activities
Net cash flows from financing
-5,790,000.00 -21,965,905.45
activities
IV. Effect of foreign exchange
rate changes on cash and cash
equivalents
V. Net increase in cash and cash
-51,783,525.95 130,437.36 9,890,766.77 3,161,928.67
equivalents
Add: Cash and cash
153,356,391.84 252,948.06 18,673,470.06 252,948.06
equivalents at the period-begin
VI. Cash and cash equivalents at
101,572,865.89 383,385.42 28,564,236.83 3,414,876.73
the period-end
4.4 Auditor’s report
Audit opinion: Un-audited
