Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
REPORT FOR THE FIRST QUARTER OF 2013
April 2013
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Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
Section I. Important Reminders
The Board of Directors, the Supervisory Committee, directors, supervisors and senior management staff of
TSANN KUEN (CHINA) ENTERPRISE CO., LTD. (hereinafter referred to as “the Company”) warrant that the
information carried in this report is factual, accurate and complete, without any false record, misleading statement
or material omission. And they shall be jointly and severally liable for that.
Jian Derong, company principal, and Chen Zongyi, chief of the accounting work and chief of the accounting
organ (chief of accounting), hereby confirm that the financial statements enclosed in this report are factual,
accurate and complete.
All directors have attended the board session for reviewing this report.
This report is prepared in both Chinese and English. Should there be any discrepancy between the two versions,
the Chinese version shall prevail.
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Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
Section II. Financial Highlights & Change of Shareholders
I. Financial highlights
Does the Company adjust retrospectively or restate any accounting data of previous years?
√ Yes □ No
Unit: RMB Yuan
Jan.-Mar. 2012 +/- (%)
Jan.-Mar. 2013 After
Before adjustment After adjustment adjustme
nt
Operating revenues 424,878,316.41 468,654,073.31 468,227,788.52 -9.26%
Net profit attributable to shareholders of the Company 7,578,667.87 -10,773,006.24 -11,645,169.27 165.08
Net profit attributable to shareholders of the Company
4,128,159.49 -15,064,665.37 -15,912,345.85 125.94
after extraordinary gains and losses
Net cash flows from operating activities -28,409,039.92 -58,560,008.93 -55,657,731.92 48.96
Basic EPS (RMB Yuan/share) 0.0409 -0.05811 -0.0628 165.13
Diluted EPS (RMB Yuan/share) 0.0409 -0.0581 -0.0628 165.13
Weighted average ROE (%) 1.54% -2.31% -2.53% 4.07
31 Dec. 2012 +/- (%)
After
31 Mar. 2013
Before adjustment After adjustment adjustme
nt
Total assets (RMB Yuan) 1,737,167,581.06 1,679,847,838.18 1,679,847,838.18 3.41
Owners’ equity attributable to shareholders of the
498,771,651.40 488,049,282.91 488,049,282.91 2.20
Company (RMB Yuan)
Note1: The basic EPS and diluted EPS for 2012 are measured based on 185,391,680 shares.
On 10 Mar. 2012, Tsann Kuen (Zhangzhou) Enterprise Co., Ltd. and Sino Global Development Limited signed the
Equity Transfer Agreement, with the latter transferring 100% equity interests of East Sino Development Limited
(its wholly-funded subsidiary) to the former at the price of US$ 6.30 million. On 11 Jun. 2012, Tsann Kuen
(Zhangzhou) Enterprise Co., Ltd. completed the equity registration alteration formalities regarding its acquisition
of equity interests of East Sino Development. This transaction made a business combination under the same
control.
Items and amounts of extraordinary gains and losses
√ Applicable □ Inapplicable
Unit: RMB Yuan
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Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
1 Jan. 2013-31 Mar.
Item Explanation
2013
Gain/loss on the disposal of non-current assets (including the offset part of the
830,629.10
asset impairment provisions)
Government grants recognized in the current period, except for those acquired in
the ordinary course of business or granted at certain quotas or amounts according 1,222,685.00
to the government’s unified standards
Gains and losses on change in fair value from tradable financial assets and
tradable financial liabilities, as well as investment income from disposal of
tradable financial assets and tradable financial liabilities and financial assets 1,993,908.17
available for sales except for effective hedging related with normal businesses of
the Company
Non-operating income and expense other than the above 897,058.39
Other gain and loss items that meet the definition of an extraordinary gain/loss 42,720.64
Income tax effects 626,926.07
Minority interests effects (after tax) 909,566.85
Total 3,450,508.38
II. Total number of shareholders at the period-end and shareholdings of top 10 shareholders
Unit: share
Total number of shareholders at the
27,242
period-end
Shareholdings of top 10 shareholders
Total shares held Number of Pledged or frozen shares
Nature of Shareholding
Name of shareholder at the restricted Number of
shareholder percentage (%) Status of shares
period-end shares held shares
FORDCHEE DEVELOPMENT Foreign
29.1% 53,940,530 0 N/A N/A
LIMITED corporation
EUPA INDUSTRY Foreign
13.83% 25,633,718 0 N/A N/A
CORPORATION LIMITED corporation
FILLMAN INVESTMENTS Foreign
2.49% 4,621,596 0 N/A N/A
LIMITED corporation
Domestic
CHEN YONGQUAN 0.9% 1,668,747 0 N/A N/A
natural person
Foreign natural
XIA QIANRU 0.7% 1,299,545 0 N/A N/A
person
ZOU SHILIN Domestic 0.55% 1,020,000 0 N/A N/A
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Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
natural person
Foreign natural
CHEN LIJUAN 0.55% 1,012,791 0 N/A N/A
person
Foreign natural
CHEN YONGQING 0.53% 981,598 0 N/A N/A
person
Foreign natural
CAI SHUHUI 0.39% 715,739 0 N/A N/A
person
Foreign
CSC SECURITIES (HK) LTD. 0.38% 696,349 0 N/A N/A
corporation
Shareholdings of top 10 non-restricted shareholders
Variety of shares
Name of shareholder Number of non-restricted shares held
Variety Number
Domestically listed
FORDCHEE DEVELOPMENT LIMITED 53,940,530 53,940,530
foreign shares
Domestically listed
EUPA INDUSTRY CORPORATION LIMITED 25,633,718 25,633,718
foreign shares
Domestically listed
FILLMAN INVESTMENTS LIMITED 4,621,596 4,621,596
foreign shares
Domestically listed
CHEN YONGQUAN 1,668,747 1,668,747
foreign shares
Domestically listed
XIA QIANRU 1,299,545 1,299,545
foreign shares
Domestically listed
ZOU SHILIN 1,020,000 1,020,000
foreign shares
Domestically listed
CHEN LIJUAN 1,012,791 1,012,791
foreign shares
Domestically listed
CHEN YONGQING 981,598 981,598
foreign shares
Domestically listed
CAI SHUHUI 715,739 715,739
foreign shares
Domestically listed
CSC SECURITIES (HK) LTD. 696,349 696,349
foreign shares
The top three shareholders are the Company’s corporate controlling shareholders.
Shareholder Cai Shuhui is the wife of Wu Tsann Kuen, the Company’s actual
Explanation on associated relationship or persons
controller. It is unknown to the Company whether there exists associated relationship
acting in concert among the above-mentioned
among the shareholders above or they are acting-in-concert entities as stipulated in the
shareholders
Administrative Measures on Information Disclosure of Changes in Shareholding of
Listed Companies.
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Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
Section III. Significant Events
I. Significant changes of the major accounting statement items and financial indicators for the
reporting period, as well as the reasons for these changes
√ Applicable □ Inapplicable
Unit: RMB Yuan
Serial
Item Closing amount Opening amount +/-% Main reason for the change
No.
Gain on undelivered forward foreign exchange
1 Transactional financial assets 160,274.39 0.00 100.00%
contracts
2 Notes receivable 4,435,667.60 3,356,956.00 32.13% Increase of undue banker’s acceptance bills
3 Accounts receivable 208,205,839.84 302,133,025.05 -31.09% Settled accounts receivable increased.
Non-current assets due within The long-term payable for equipment due within
4 1,440,016.77 2,434,759.94 -40.86%
one year one year was settled.
5 Long-term payables 1,767,615.93 3,370,946.33 -47.56% The mature payable for equipment was settled.
6 Investing real estate 56,441,250.08 39,319,457.87 43.55% Some housing properties were leased out and thus
adjusted from fixed assets and intangible assets to
7 Intangible assets 16,227,709.00 25,461,786.16 -36.27%
investing real estate.
8 Short-term borrowings 156,722,500.00 31,427,500.00 398.68% Increase of short-term borrowings
Transactional financial Gain on undelivered forward foreign exchange
9 0.00 363,255.25 -100.00%
liabilities contracts
10 Taxes and fares payable (33,364,608.33) (23,837,739.85) 39.97% The enterprise income tax was prepaid.
Increase of intra-Group borrowings from related
11 Other payables 176,035,623.22 53,435,685.41 229.43%
parties
Serial
Item Jan.-Mar. 2013 Jan.-Mar. 2012 +/-% Main reason for the change
No.
The operating revenues decreased and cost
1 Sales expenses 16,237,180.87 24,364,183.57 -33.36%
control was carried out.
RMB appreciation created an unfavorable
2 Financial expenses 276,017.39 (5,164,665.49) 105.34%
condition for exchange.
Gain on the undelivered forward foreign
3 Gain on fair value changes 523,529.64 1,045,679.08 -49.93%
exchange contracts decreased.
Gain on the delivered forward foreign exchange
4 Investment gain 1,520,632.17 3,651,625.13 -58.36%
contracts decreased.
5 Non-operating income 2,986,661.35 949,752.28 214.47% The subsidy income increased.
Net cash flows due to operating In the same period of last year, the Company paid
6 (28,409,039.92) (55,657,731.92) -48.96%
activities the plant rent for the previous year.
Net cash flows due to financing
7 (7,906,884.84) (14,907,951.03) -46.96% The procured fixed assets decreased.
activities
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Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
II. Progress of significant events and analysis & explanations on their influence and solutions
(I) Contingent events
Tsann Kuen Zhangzhou, one of the Company’s subsidiaries, and Xinda Motor Co., Ltd. (hereinafter refer to as
“Xinda Motor”) signed a product supply contract on 20 Jul. 2009, with the valid period for the contract being
from 1 Jul. 2009 to 30 Jun. 2012. Both parties also signed the 2011 ED Procurement Contract of Tsann Kuen
Zhangzhou Enterprises Co., Ltd., the Special Agreement and other agreements, according to which Tsann Kuen
Zhangzhou would purchase products from Xinda Motor. Later, Tsann Kuen Zhangzhou refused to pay for the
products and chose to terminate the contract due to quality problems found in Xinda Motor’s products. On 2 Nov.
2011, Xinda Motor filed a civil action against Tsann Kuen Zhangzhou to Zhangzhou Intermediate People’s Court,
asking the court to order Tsann Kuen Zhangzhou to pay US$479,089.06 to it for the part of the contract that had
been executed but not yet paid for, to bear the damages for overdue payment, and to continue to execute the
unexecuted contractual obligation (equivalent to a payment of US$189,423.25 for goods).
Tsann Kuen Zhangzhou filed a cross action on 8 Jan. 2012. Xinda Motor had caused serious economic loss and
reputation damage on Tsann Kuen Zhangzhou for the products it provided for Tsann Kuen Zhangzhou did not go
with the contract, due to which Tsann Kuen Zhangzhou produced products of ill quality, goods were returned and
orders were canceled. On that basis, Tsann Kuen Zhangzhou asked Zhangzhou Intermediate People’s Court to
terminate the contract between both parties and order Xinda Motor to pay to Tsann Kuen Zhangzhou a damage of
RMB1 million, and a compensation of RMB7,621,600.
Up to the reporting day, the outstanding amount due from Tsann Kuen Zhangzhou to Xinda Motor was
USD479,089.06. The case is currently on the docket.
(II) Explain in detail the change of the consolidation scope from the last reporting period
√ Applicable □ Inapplicable
Unit: RMB Yuan
Net profit from
Time of Net assets on the Reason for change of
Deconsolidated subsidiary year-begin to
deconsolidation disposal day the consolidation scope
disposal day
Shanghai Fanxin Airlines Service Co., Ltd. 18 Mar. 2013 254,402.41 -25,738.47 Written off
Star (Dalian) International Travel Service
21 Mar. 2013 0.00 120,759.65 Equity transfer
Co., Ltd.
According to the adjustments of the operating strategies, the travel service business of subsidiaries was stopped.
And progress concerning the travel service subsidiaries at the end of the reporting period is as follows:
About Shanghai Fanxin Airlines Service Co., Ltd., a wholly-funded subsidiary of the Company’s controlled
subsidiary Tsann Kuen Zhangzhou with a registered capital of RMB 5.50 million, the liquidation formalities were
completed on 18 Mar. 2013.
The Company’s controlled subsidiary Tsann Kuen Zhangzhou held a 99% stake in Star (Dalian) International
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Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
Travel Service Co., Ltd., whose registered capital was RMB 5.30 million. On 13 Mar. 2013, the 99% stake was all
transferred to a non-related party and on 21 Mar. 2013, the registered information in the administration for
industry and commerce was altered.
Other travel service subsidiaries are currently going through subsequent liquidation matters.
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Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
(III) Sale of assets:
Due to operating needs, the following assets were sold in the reporting period:
Unit: RMB Yuan
Net profit
contributed
Relate
by the sold
d-part
asset to the
VAT and Gain/loss on y Pricing relatio
Transaction party Asset sold Selling price Original value Net value Company
fares the sale transac principle n
from
tion or
year-begin
not
to date of
sale
Injection molding
Zhangzhou Chuangyi 4,000.00 124,440.00 0.00 76.92 3,923.08 3,923.08
equipment
Die casting
Zhangzhou Yufeng 5,000.00 104,487.87 0.00 348.29 4,651.71 4,651.71
equipment
Die casting
Zhangzhou Ruicheng 2,500.00 0.00 0.00 363.25 2,136.75 2,136.75 The
equipment
transaction
Zhangzhou Canming Hardware 3,000.00 43,983.00 29.02 57.69 2,913.29 2,913.29
prices
Zhangzhou were
Other equipment 8,122.14 221,196.08 0.00 1,180.14 6,942.00 6,942.00
Hongyuan decided
Zhangzhou Injection molding based on
12,700.00 471,353.30 0.00 244.23 12,455.77 12,455.77
Lianfuxin equipment the
principle
Xiamen Weiyao Other equipment 22,000.00 6,093.18 0.00 738.25 21,261.75 21,261.75 Non-re Non-re
of being
lated lated
Die casting above the
Zhangzhou Yingfa 26,000.00 101,554.09 0.00 500.00 25,500.00 25,500.00 party party
equipment net book
value, as
Zhangzhou Kunyi Other equipment 2,300.00 8,825.19 0.00 107.26 2,192.74 2,192.74
well as on
Injection molding
Zhangzhou LBN 900.00 10,244.56 0.00 17.31 882.69 882.69 the
equipment
assessmen
Die casting t and
Zhangzhou Boer 38,000.00 299,022.99 0.00 730.77 37,269.23 37,269.23
equipment market
Xiamen Die casting prices.
35,000.00 324,231.94 0.00 673.08 34,326.92 34,326.92
Jinshengrong equipment
Die casting
Zhangzhou Huatai 21,000.00 806,043.37 0.00 403.85 20,596.15 20,596.15
equipment
Houses and
Chen Qingling 802,450.00 542,096.50 131,458.78 15,414.20 655,577.02 655,577.02
buildings
Total 982,972.14 3,063,572.07 131,487.80 20,855.24 830,629.10 830,629.10
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Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
III. Commitments made by the Company or any shareholder with a shareholding over 5% in
the reporting period or such commitments carried down into the reporting period
Date of Period of
Commitment Commitment maker Contents of commitment Execution
commitment commitment
Share reform commitment
Commitment made in an
acquisition report or a report
on equity changes
Commitment made in asset
reorganization
Commitment made in IPO
or re-financing
Based on the confidence on the
continuous and stable development
of the Company, it committed to
increase the shareholding if the The Company’s
Company’s stock price lower than stocks resumed
HKD2.40 per share after the trading on 31 Dec.
implementation of the shares 2012, but the
contraction and trading resumption, Company’s stock
and it would increase no more than price hasn’t met the
Within one
2% shares (i.e. 370,780,000 shares) condition for
Commitment made to FILLMAN year since the
of the total shares issued by the shareholding
minority shareholders of the INVESTMENTS 28 Nov. 2012 date of initial
Company within one year since the increase since the
Company LIMITED shareholding
date of initial shareholding increase. date of trading
increase
If the plan on increasing holding 2% resumption,
shares of the total shares is FILLMAN
completed, if the stock price hasn’t Investment Limited
reached the target price, it will hasn’t implemented
perform relevant approval the shareholding
procedures, and propose to CSRC increase plan.
on continuous implementation of
shareholding increase by exemption
of offering.
Executed in time or not Yes
Specific reason for failing to
execute the commitment
No
and the plan for the next
step
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Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
Is a commitment made
concerning any resulted
No
horizontal competition and
related-party transaction?
Promised time needed to
Within one year since the date of initial shareholding increase
solve the problems
Fillman Investments Limited committed to increase the shareholding if the Company’s stock price lower than
HKD2.40 per share after the implementation of the shares contraction and trading resumption, and it would
Way of solving the increase no more than 2% shares (i.e. 370,780,000 shares) of the total shares issued by the Company within one
problems year since the date of initial shareholding increase. If the plan on increasing holding 2% shares of the total shares
is completed, if the stock price hasn’t reached the target price, it will perform relevant approval procedures, and
propose to CSRC on continuous implementation of shareholding increase by exemption of offering.
The Company’s stocks resumed trading on 31 Dec. 2012, but the Company’s stock price hasn’t met the condition
Execution for shareholding increase since the date of trading resumption, FILLMAN Investment Limited hasn’t
implemented the shareholding increase plan.
IV. Predict the operating results of Jan.-Jun. 2013
Warning of possible loss or considerable YoY change of the accumulated net profit made during the period-begin to the end of the
next reporting period according to prediction, as well as explanations on the reasons:
√ Applicable □ Inapplicable
Prediction: turning deficit to profit
Type of the predicted data: interval data
Item Jan.-Jun. 2013 Jan.-Jun. 2012 +/- (%)
Predicted accumulative net profit (RMB Ten
1000-1500 -1,938 152%-177%
thousand)
Basic EPS (RMB Yuan/share) 0.05-0.08 -0.10 150%-180%
The Company strictly controlled the procurement costs, enhanced the internal
operation and management and optimized the production and sales processes. As a
Explanation about the predictions
result, the overall gross profit and the management and sales expenses improved over
last year.
V. Securities investments
□ Applicable √ Inapplicable
VI. Derivative investments
In order to avoid the risk of exchange rate fluctuations, the Company’s controlled subsidiary Tsann Kuen
Zhangzhou conducts financial derivative investment for the hedging purpose, including forward foreign exchange
and structural forward with foreign exchange swap and foreign exchange option.
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Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
The Company’s controlled subsidiary Tsann Kuen Zhangzhou has formulated the “Internal Control Rules for
Financial Derivative Investment”. On 9 Mar. 2013, the “Proposal on the Controlled Subsidiary Tsann Kuen
Zhangzhou Conducting Financial Derivative Investment” was reviewed and approved unanimously at the 2nd
board session for 2013.
1. Potential risks of holding financial derivatives
(1) Market risk: In a financial derivative investment, the actual gain/loss comes from the difference
between the agreed trading exchange rate and the actual exchange rate on the maturity day. When
holding the financial derivative, a revaluation gain/loss will rise for every accounting period and the
accumulative revaluation gain/loss till the maturity day equals the actual gain/loss.
(2) Liquidity risk: The financial derivative investment is carried out according to a certain proportion of
the foreign exchange income/expense budget. Since the financial derivative investment is in line with
the actual foreign exchange income/expense, it is assured that there will be sufficient funds for clearing
when delivery comes, which thus has little influence on the current assets of the Company.
(3) Performance risk: The Company chooses large commercial banks with a high credit rating to trade
with in financial derivative investment. These banks operate steadily with good credit standing. The
performance risk basically doesn’t exist.
2. Control measures:
(1) Before carrying out a derivative investment, the financial department assesses the investment risk
and analyze the feasibility and necessity of the investment. In addition, the relevant committee of the
Analysis on risks and control board will examine the necessity and risk control of the derivative investment.
measures of derivative products held (2) Before making a derivative investment, the Company will equip itself with professional personnel
in the reporting period (including but for investment decision-making, business operation, risk control, etc.. Personnel taking part in the
not limited to market risk, liquidity investment all fully understand the risks of derivative investment and strictly execute the business
risk, credit risk, operation risk, law operation and risk management mechanisms for derivative investment.
risk, etc.) (3) The Company should strictly control the variety and scale of derivative investment and try to use
derivative transaction on exchange when possible. The Company chooses large commercial banks with
a high credit rating to trade with in financial derivative investment. These banks operate steadily with
good credit standing. The performance risk basically doesn’t exist.
(4) Principle: The purpose of the financial derivative operation is to avoid risks. The Company shall not
conduct transactional operation for other purposes than risk avoidance. The overall contractual amount
for risk avoidance of the Company shall not exceed the summation of the net risk exposure of the
existing assets and liabilities and the net risk exposure of assets and liabilities arising from the
operation of the Company in the coming year.
(5) Periodic evaluation: The Company kept an eye on the profit and loss from the fair value changes of
the derivative by checking daily/(monthly) the difference between the estimated exchange rate
(provided by the bank)*the undue contracted amount and the currency amount when bought in.
(6) Loss limit: The investment loss on a single derivative and all the investment loss shall not exceed
20% of the total investment amount.
(7) Audit system: The audit department audits derivative audit trade of derivative financial products
periodically and submit audit report.
Changes of market prices or fair (1) Gains and losses effected by completed transaction amount of derivative products was RMB 1.4704
values in the reporting period of the million, and gain from undelivered transaction was RMB 523,500 in the reporting period.
invested derivatives. And the analysis (2) The former contracted bank provided monthly sheets of estimated exchange rates for the undue
on the fair value of the derivatives contracted forward exchanges on the last trading day of the month.
should include the specific use (3) The profit and loss from fair value changes of the derivative was confirmed according to the
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Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
methods and the relevant assumptions difference between the contracted amount undue by the month*the estimated exchange rate and the
and parameters. currency amount when bought in.
Whether significant changes occurred
to the Company’s accounting policy
and specific accounting principles of There were no significant changes between the Company’s accounting policy and specific accounting
derivatives in the reporting period principles of derivatives in the reporting period and those in the last reporting period.
compared to the previous reporting
period
To lock up the exchange cost through rational financial derivative instruments to reduce the exchange
Special opinion from independent rate fluctuation risk can help increase the financial stability of Tsann Kuen Zhangzhou and improve its
directors, sponsor or financial competitiveness. The Company has carried out a strict internal assessment for the foreign exchange
consultant on the Company’s derivative business and has established a corresponding supervision mechanism. We are of the opinion
derivatives investment and risk that the foreign exchange derivative business conducted by Tsann Kuen Zhangzhou is fairly necessary
control in its routine operation and is in compliance with relevant laws and regulations, with the risks
controllable.
Derivative investments held at period-end:
√ Applicable □ Inapplicable
Unit: RMB Yuan
Proportion of the closing
Opening contract Closing contract amount Gain or loss in the contract amount in the
Type of contract
amount （RMB Yuan） （RMB Yuan） reporting period closing net assets of the
Company (%)
Forward exchange deals 3,633,236.98 10,216,630.25 226,174.39 2.05%
Forward exchange trading
354,622,300.00 524,060,100.00 (65,900.00) 105.07%
against RMB
Total 358,255,536.98 534,276,730.25 160,274.39 107.12%
VII. Researches, visits and interviews received in the reporting period
Place of Way of Main discussion and materials provided by the
Time of reception Visitor type Visitor
reception reception Company
Operation of the Company, B-share policies, with
19 Jan. 2013 Office By phone Individual Mr. Yu
no written materials provided by the Company
Operation of the Company, B-share policies, with
7 Feb. 2013 Office By phone Individual Mr. Yang
no written materials provided by the Company
Information about the annual report of the
13 Mar. 2013 Office By phone Individual Mr. Yu Company, with no written materials provided by
the Company
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Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
Section IV. Financial Statements
1. Consolidated balance sheet
Prepared by TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
Unit: RMB Yuan
Item Closing balance Opening balance
Current Assets:
Monetary funds 953,326,136.21 759,361,575.52
Settlement reserves
Intra-group lendings
Transactional financial assets 160,274.39
Notes receivable 4,435,667.60 3,356,956.00
Accounts receivable 208,205,839.84 302,133,025.05
Accounts paid in advance 2,723,777.66 3,348,515.58
Premiums receivable
Reinsurance premiums receivable
Receivable reinsurance contract reserves
Interest receivable 4,192,043.80 5,231,397.36
Dividend receivable
Other accounts receivable 32,882,768.44 41,516,107.15
Financial assets purchased under agreements to resell
Inventories 217,424,027.57 242,578,891.54
Non-current assets due within 1 year 1,440,016.77 2,434,759.94
Other current assets
Total current assets 1,424,790,552.28 1,359,961,228.14
Non-current assets:
Loans by mandate and advances granted
Available-for-sale financial assets
Held-to-maturity investments
Long-term accounts receivable 1,767,615.93 3,370,946.33
Long-term equity investment 40,000.00 40,000.00
Investing property 56,441,250.08 39,319,457.87
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Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
Fixed assets 205,643,558.99 219,374,057.54
Construction in progress 8,168,578.34 7,094,433.42
Engineering materials
Disposal of fixed assets
Production biological assets
Oil-gas assets
Intangible assets 16,227,709.00 25,461,786.16
R&D expense
Goodwill
Long-term deferred expenses 5,823,371.67 6,152,543.07
Deferred income tax assets 18,264,944.77 19,073,385.65
Other non-current assets
Total of non-current assets 312,377,028.78 319,886,610.04
Total assets 1,737,167,581.06 1,679,847,838.18
Current liabilities:
Short-term borrowings 156,722,500.00 31,427,500.00
Borrowings from Central Bank
Customer bank deposits and due to banks and other
financial institutions
Intra-group borrowings
Transactional financial liabilities 363,255.25
Notes payable 51,924,984.18 70,851,519.07
Accounts payable 479,070,976.08 647,831,038.73
Accounts received in advance 13,572,630.32 12,488,450.33
Financial assets sold for repurchase
Handling charges and commissions payable
Employee’s compensation payable 32,186,442.43 40,116,618.69
Tax payable -33,364,608.33 -23,837,739.85
Interest payable 6,324.78
Dividend payable
Other accounts payable 176,035,623.22 53,435,685.41
Reinsurance premiums payable
Insurance contract reserves
Payables for acting trading of securities
15
Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
Payables for acting underwriting of securities
Non-current liabilities due within 1 year
Other current liabilities
Total current liabilities 876,148,547.90 832,682,652.41
Non-current liabilities:
Long-term borrowings
Bonds payable
Long-term payables
Specific payables
Estimated liabilities 11,401.92 11,401.92
Deferred income tax liabilities 71,318.60 44,686.69
Other non-current liabilities 222,600.00 222,600.00
Total non-current liabilities 305,320.52 278,688.61
Total liabilities 876,453,868.42 832,961,341.02
Owners’ equity (or shareholders’ equity)
Paid-up capital (or share capital) 185,391,680.00 185,391,680.00
Capital reserves 278,454,447.07 278,454,447.07
Less: Treasury stock
Specific reserves
Surplus reserves 6,120,201.82 6,120,201.82
Provisions for general risks
Retained profits 28,376,659.57 20,797,991.70
Foreign exchange difference 428,662.94 -2,715,037.68
Total equity attributable to owners of the Company 498,771,651.40 488,049,282.91
Minority interests 361,942,061.24 358,837,214.25
Total owners’ (or shareholders’) equity 860,713,712.64 846,886,497.16
Total liabilities and owners’ (or shareholders’) equity 1,737,167,581.06 1,679,847,838.18
Legal representative: Jian Derong Chief of the accounting work: Chen Zongyi Chief of the accounting organ: Chen Zongyi
16
Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
2. Balance sheet of the Company
Prepared by TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
Unit: RMB Yuan
Item Closing balance Opening balance
Current Assets:
Monetary funds 10,926,826.95 17,652,594.45
Transactional financial assets
Notes receivable 1,590,000.00 1,257,500.00
Accounts receivable 3,280,814.85 4,172,243.78
Accounts paid in advance 184,703.97 96,047.65
Interest receivable
Dividend receivable
Other accounts receivable 1,569,413.16 236,719.46
Inventories 4,799,051.32 7,392,344.32
Non-current assets due within 1 year
Other current assets
Total current assets 22,350,810.25 30,807,449.66
Non-current assets:
Available-for-sale financial assets
Held-to-maturity investments
Long-term accounts receivable
Long-term equity investment 990,854,030.83 990,854,030.83
Investing property 47,839,469.53 31,212,851.79
Fixed assets 1,785,183.72 11,211,651.90
Construction in progress 58,500.00
Engineering materials
Disposal of fixed assets
Production biological assets
Oil-gas assets
Intangible assets 4,863,382.04 13,758,144.40
R&D expense
Goodwill
Long-term deferred expenses 1,306,669.49 1,216,744.00
Deferred income tax assets
Other non-current assets
Total of non-current assets 1,046,648,735.61 1,048,311,922.92
Total assets 1,068,999,545.86 1,079,119,372.58
Current liabilities:
Short-term borrowings
Transactional financial liabilities
Notes payable
Accounts payable 21,123,001.87 17,907,562.95
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Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
Accounts received in advance 132,304.01 115,424.99
Employee’s compensation payable 257,886.05 522,592.57
Tax payable 2,089,088.84 1,124,273.49
Interest payable
Dividend payable
Other accounts payable 563,714,722.37 580,459,985.94
Non-current liabilities due within 1 year
Other current liabilities
Total current liabilities 587,317,003.14 600,129,839.94
Non-current liabilities:
Long-term borrowings
Bonds payable
Long-term payables
Specific payables
Estimated liabilities
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities 0.00 0.00
Total liabilities 587,317,003.14 600,129,839.94
Owners’ equity (or shareholders’ equity)
Paid-up capital (or share capital) 185,391,680.00 185,391,680.00
Capital reserves 271,485,181.40 271,485,181.40
Less: Treasury stock
Specific reserves
Surplus reserves 6,120,201.82 6,120,201.82
Provisions for general risks
Retained profits 18,685,479.50 15,992,469.42
Foreign exchange difference
Total owners’ (or shareholders’) equity 481,682,542.72 478,989,532.64
Total liabilities and owners’ (or shareholders’) equity 1,068,999,545.86 1,079,119,372.58
Legal representative: Jian Derong Chief of the accounting work: Chen Zongyi Chief of the accounting organ: Chen Zongyi
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Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
3. Consolidated income statement
Prepared by TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
Unit: RMB Yuan
Item Jan.-Mar. 2013 Jan.-Mar. 2012
I. Total operating revenues 424,878,316.41 468,227,788.52
Including: Sales income 424,878,316.41 468,227,788.52
Interest income
Premium income
Handling charge and commission income
II. Total operating cost 419,000,253.40 489,630,767.77
Including: Cost of sales 362,729,320.18 419,177,051.49
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 charges 746,142.20 914,290.30
Selling and distribution expenses 16,237,180.87 24,364,183.57
Administrative expenses 37,164,993.01 47,759,954.80
Financial expenses 276,017.39 -5,164,665.49
Asset impairment loss 1,846,599.75 2,579,953.10
Add: Gain/(loss) from change in fair value (“-” means
loss) 523,529.64 1,045,679.08
Gain/(loss) from investment (“-” means loss) 1,520,632.17 3,651,625.13
Including: share of profits in associates and joint ventures
Foreign exchange gains (“-” means loss)
III. Business profit (“-” means loss) 7,922,224.82 -16,705,675.04
Add: non-operating income 2,986,661.35 949,752.28
Less: non-operating expense 36,288.86 3,028.27
Including: loss from non-current asset disposal 21,954.21 2,489.51
IV. Total profit (“-” means loss) 10,872,597.31 -15,758,951.03
Less: Income tax expense 1,293,262.02
V. Net profit (“-” means loss) 9,579,335.29 -15,758,951.03
Including: Net profit achieved by combined parties
before the combinations
Attributable to owners of the Company 7,578,667.87 -11,645,169.27
Minority shareholders’ income 2,000,667.42 -4,113,781.76
VI. Earnings per share
(I) Basic earnings per share 0.0409 -0.0628
(II) Diluted earnings per share 0.0409 -0.0628
Ⅶ. Other comprehensive incomes 3,143,700.62 -2,093,479.83
Ⅷ. Total comprehensive incomes 12,723,035.91 -17,852,430.86
Attributable to owners of the Company 10,722,368.49 -13,738,649.10
Attributable to minority shareholders 2,000,667.42 -4,113,781.76
Legal representative: Jian Derong Chief of the accounting work: Chen Zongyi Chief of the accounting organ: Chen Zongyi
19
Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
4. Income statement of the Company
Prepared by TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
Unit: RMB Yuan
Item Jan.-Mar. 2013 Jan.-Mar. 2012
I. Total sales 14,033,533.23 2,838,132.20
Less: cost of sales 9,440,705.71 1,286,729.58
Business taxes and surcharges 243,736.32 158,935.42
Distribution expenses 1,129,123.84
Administrative expenses 1,340,721.67 1,191,497.70
Financial costs -30,339.32 -9,270.58
Impairment loss -1,265.05 -3,507.12
Add: gain/(loss) from change in fair value (“-” means
loss)
Gain/(loss) from investment (“-” means loss) 7,533.00
Including: income form investment on associates and
joint ventures
II. Business profit (“-” means loss) 1,918,383.06 213,747.20
Add: non-business income 774,627.02 136,550.19
Less: non-business expense
Including: loss from non-current asset disposal
III. Total profit (“-” means loss) 2,693,010.08 350,297.39
Less: income tax expense
IV. Net profit (“-” means loss) 2,693,010.08 350,297.39
V. Earnings per share
(I) Basic earnings per share 0.0145 0.0019
(II) Diluted earnings per share 0.0145 0.0019
VI. Other comprehensive income
VII. Total comprehensive income 2,693,010.08 350,297.39
Legal representative: Jian Derong Chief of the accounting work: Chen Zongyi Chief of the accounting organ: Chen Zongyi
20
Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
5. Consolidated cash flow statement
Prepared by TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
Unit: RMB Yuan
Item Jan.-Mar. 2013 Jan.-Mar. 2012
I. Cash flows from operating activities:
Cash received from sale of commodities and rendering of service 501,946,380.82 646,645,508.06
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 intra-group borrowings
Net increase of funds in repurchase business
Tax refunds received 60,384,540.74 79,805,697.22
Other cash received relating to operating activities 27,491,106.59 17,940,844.80
Subtotal of cash inflows from operating activities 589,822,028.15 744,392,050.08
Cash paid for goods and services 503,436,795.67 626,327,480.69
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 63,454,007.41 71,823,254.85
Various taxes paid 10,366,404.15 8,061,052.63
Other cash payment relating to operating activities 40,973,860.84 93,837,993.83
Subtotal of cash outflows from operating activities 618,231,068.07 800,049,782.00
Net cash flows from operating activities -28,409,039.92 -55,657,731.92
II. Cash flows from investing activities:
Cash received from withdrawal of investments
Cash received from return on investments 1,470,378.53 3,651,625.13
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Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
Net cash received from disposal of fixed assets, intangible assets and other
3,947,653.12 1,488,946.88
long-term assets
Net cash received from disposal of subsidiaries or other business units 99,000.00
Other cash received relating to investing activities
Subtotal of cash inflows from investing activities 5,517,031.65 5,140,572.01
Cash paid to acquire fixed assets, intangible assets and other long-term
13,423,916.49 20,048,523.04
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 investing activities 13,423,916.49 20,048,523.04
Net cash flows from investing activities -7,906,884.84 -14,907,951.03
III. Cash Flows from Financing Activities:
Cash received from capital contributions
Including: Cash received from minority shareholder investments by
subsidiaries
Cash received from borrowings 125,387,600.00 113,479,580.00
Cash received from issuance of bonds
Other cash received relating to financing activities 106,608,300.00 126,384,500.00
Subtotal of cash inflows from financing activities 231,995,900.00 239,864,080.00
Repayment of borrowings
Cash paid for interest expenses and distribution of dividends or profit 163,955.50
Including: dividends or profit paid by subsidiaries to minority
shareholders
Other cash payments relating to financing activities 4,092.88
Sub-total of cash outflows from financing activities 163,955.50 4,092.88
Net cash flows from financing activities 231,831,944.50 239,859,987.12
IV. Effect of foreign exchange rate changes on cash and cash equivalents -1,551,459.05 -582,049.11
V. Net increase in cash and cash equivalents 193,964,560.69 168,712,255.06
Add: Opening balance of cash and cash equivalents 759,361,575.52 706,132,025.56
VI. Closing balance of cash and cash equivalents 953,326,136.21 874,844,280.62
Legal representative: Jian Derong Chief of the accounting work: Chen Zongyi Chief of the accounting organ: Chen Zongyi
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Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
6. Cash flow statement of the Company
Prepared by TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
Unit: RMB Yuan
Item Jan.-Mar. 2013 Jan.-Mar. 2012
I. Cash flows from operating activities:
Cash received from sale of commodities and rendering of service 9,750,164.61
Tax refunds received
Other cash received relating to operating activities 13,777,633.02 10,485,241.81
Subtotal of cash inflows from operating activities 23,527,797.63 10,485,241.81
Cash paid for goods and services 3,509,553.52 0.00
Cash paid to and for employees 10,134,529.22 9,377,910.60
Various taxes paid 416,609.55 506,777.89
Other cash payment relating to operating activities 16,986,336.66 1,016,168.00
Subtotal of cash outflows from operating activities 31,047,028.95 10,900,856.49
Net cash flows from operating activities -7,519,231.32 -415,614.68
II. Cash flows from investing activities:
Cash received from retraction of investments
Cash received from return on investments
Net cash received from disposal of fixed assets, intangible assets and
797,450.00 180,000.00
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 from investing activities 797,450.00 180,000.00
Cash paid to acquire fixed assets, intangible assets and other long-term
99,400.00
assets
Cash paid for investment
Net cash paid to acquire subsidiaries and other business units
Other cash payments relating to investing activities
Subtotal of cash outflows from investing activities 0.00 99,400.00
Net cash flows from investing activities 797,450.00 80,600.00
III. Cash Flows from Financing Activities:
Cash received from capital contributions
Cash received from borrowings
Cash received from issuance of bonds
Other cash received relating to financing activities
Subtotal of cash inflows from financing activities 0.00 0.00
Repayment of borrowings
Cash paid for interest expenses and distribution of dividends or profit
Other cash payments relating to financing activities 2,000,000.00
Sub-total of cash outflows from financing activities 0.00 2,000,000.00
Net cash flows from financing activities 0.00 -2,000,000.00
IV. Effect of foreign exchange rate changes on cash and cash equivalents -3,986.18 -5,228.94
V. Net increase in cash and cash equivalents -6,725,767.50 -2,340,243.62
Add: Opening balance of cash and cash equivalents 17,652,594.45 13,757,429.84
VI. Closing balance of cash and cash equivalents 10,926,826.95 11,417,186.22
Legal representative: Jian Derong Chief of the accounting work: Chen Zongyi Chief of the accounting organ: Chen Zongyi
23
Report for the First Quarter of 2013 of TSANN KUEN (CHINA) ENTERPRISE CO., LTD.
7. Audit report
This report has not been audited.
Board of Directors of TSANN KUEN (CHINA) ENTERPRISE CO., LTD
The chairman of the Board: Jian Derong
20 April 2013
24
