2011 Annual Report Summary

Transcription

1 Stock Code: / Short Form of Stock: Southern Glass A/B Notice No.: CSG HOLDING CO., LTD. Chairman of the Board: ZENG NAN March, 2012

2 1. Important Notice 1.1 Board of Directors and the Supervisory Committee of CSG Holding Co., Ltd. (hereinafter referred to as the Company) and its directors, supervisors and senior executives hereby confirm that there are no any fictitious statements, misleading statements, or important omissions carried in this report, and shall take all responsibilities jointly and severally, for the truthfulness, accuracy and completeness of the whole contents. The 2011 annual report summary is abstracted from the full text of annual report. And the investors are suggested to read the full text of the Annual Report to understand more details. And the English translation is reference only. Should there be any inconsistency between the Chinese and English versions, the Chinese version shall prevail. 1.2 All directors attended the Meeting personally except the following one: Name of absentee Title for absentee Reason for absence Name of entrustee Wang Tianguang Independent Director Business trip Chen Chao 1.3 PricewaterhouseCoopers Zhong Tian Certified Public Accountants Co., Ltd audited the Annual Financial Report 2011, and issued standard unqualified Auditor s Report. 1.4 Mr. Zeng Nan, Chairman of the Board & CEO of the Company, CFO Mr. Luo Youming and principle of the financial department Mr. Huang Yanbin confirm that the Financial Report enclosed in this 2011 Annual Report is true and complete. 1.5 English translation is for reference only. Should there be any inconsistency between the Chinese and English versions, the Chinese version shall prevail. 2. Company Profile 2.1 Basic information Short form of stock Southern Glass A, Southern Glass B Stock code , Listed stock exchange Shenzhen Stock Exchange 2.2 Contact person and method Secretary of the Board Securities Affairs Representative Name Wu Guobin Zhou Hong Contact address CSG Building, No.1, the 6 th Industrial Road, CSG Building, No.1, the 6 th Industrial Road, Shekou, Shenzhen, P.R.C. Shekou, Shenzhen, P.R.C. Telephone (86) (86) Fax (86) (86) securities@csgholding.com securities@csgholding.com -1-

3 3. Summary of Accounting Data and Financial Indexes 3.1 Major accounting data Unit: RMB 2011 Percentage change 2010 between 2011 and Revenue 8,270,731,730 7,743,941, % 5,279,100,133 Operating profit 1,501,575,318 1,833,110, % 1,072,791,061 Total profit 1,637,980,229 1,865,346, % 989,064,781 Net profit attributable to equity holders of the Company 1,178,229,197 1,455,209, % 831,944,393 Net profit attributable to equity holders of the Company 1,067,580,683 1,386,137, % 881,934,137 after extraordinary gains and losses Net cash flows from operating activities 1,688,530,164 2,366,313, % 1,670,237, Dec Dec Percentage change on 31 Dec compared to 31 Dec Dec Total assets 15,281,391,077 12,469,619, % 10,913,350,017 Total liabilities 7,975,456,538 5,710,400, % 5,302,276,985 Total equity attributable to equity holders of the 6,911,117,984 6,384,871, % 5,315,523,161 Company Capital 2,075,837,060 2,076,721, % 1,223,738, Major financial indices Unit: RMB Percentage change between and Basic earnings per share Note % 0.40 Diluted earnings per share Note % 0.40 Basic earnings per share after extraordinary gains and losses Note % 0.42 Weighted average return on equity (%) 17.94% 25.04% Decrease 7.10 percentage points 16.86% Weighted average return on equity after extraordinary gains and losses (%) 16.25% 23.85% Decrease 7.60 percentage points 17.87% Net cash flows from operating activities per share % Dec. 31 Dec Percentage change on 31 Dec compared to 31 Dec Dec Total assets per share for equity holders of the Company % 4.34 Asset-liability ratio 52.19% 45.79% Increase 6.40 percentage points 48.59% Note: The financial data in the same period 2009 & 2010 have been adjusted as new paid-in capital. -2-

4 3.3 Items of extraordinary gains and losses Applicable Inapplicable Unit: RMB Items of extraordinary gains and losses 2011 Note Gains and losses on disposal of non-current assets -1,940,045-11,165, ,764,956 Government subsides recognized as gains and losses 120,129,140 33,675,322 23,865,251 Gains on disposal of available-for-sale financial assets 0 9,055,042 17,538,302 Net income of Share Transfer 4,392,843 In March 2011, 100% equity of 40,359,075 0 Dongguan CSG Ceramics Technology Co., Ltd. was sold to nature person Yang Bohuan by the Company with income of RMB 4,392,843. Net value of other non-operating expenses 18,215,816 9,726, ,425 Tax effects -21,048,058-11,578,309 19,237,132 Extraordinary gains and losses of minority interests -9,101,182-1,000,414-3,038,898 (after tax) Total: 110,648,514-69,071,875-49,989,744-3-

5 4. Particulars about Shareholders and controlling diagram 4.1 Particulars about the shares held by the top ten shareholders, and the shares held by the top ten unrestricted shareholders. Total shareholders at the end of 2011 Particulars about the shares held by the top ten shareholders Name of shareholder 271,779 Total shareholders at one month-earlier before Nature of shareholders the date for annual report disclosed Proportion Total shares in total held Restricted shares held Unit: Share 263,579 Shares pledged or frozen China Northern Industries Corporation State-funded shareholder 3.62% 75,167, Xing Tong Chan Industrial Development (Shenzhen) Co., Ltd. Shenzhen International Holdings (SZ) Limited Bank of Communication - Boshi New Growth Stock Fund Bank of China - E Fund Shenzhen Index 100 ETF 3.26% 67,740, % 65,430, % 20,000, % 18,556, Invesco Funds Series 5 Foreign-funded shareholder 0.64% 13,273, ICBC - Rongtong Shenzhen Index 100 Stock Fund BBH A/C Vanguard Emerging Markets Stock Index Fund 0.61% 12,577, Foreign-funded shareholder 0.60% 12,436, Guotai Junan Securities (HongKong) Limited Foreign-funded shareholder 0.55% 11,478, PICC - dividend-individual issuance Particulars about the shares held by the top ten unrestricted shareholders 0.54% 11,224, Name of shareholder Unrestricted share held Type of share China Northern Industries Corporation 75,167,934 A-share Xing Tong Chan Industrial Development (Shenzhen) Co., Ltd. 67,740,000 A-share Shenzhen International Holdings (SZ) Limited 65,430,000 A-share Bank of Communication - Boshi New Growth Stock Fund 20,000,000 A-share Bank of China - E Fund Shenzhen Index 100 ETF 18,556,857 A-share Invesco Funds Series 5 13,273,758 B-share ICBC - Rongtong Shenzhen Index 100 Stock Fund 12,577,082 A-share BBH A/C Vanguard Emerging Markets Stock Index Fund 12,436,803 B-share Guotai Junan Securities (HongKong) Limited 11,478,826 B-share PICC - dividend-individual issuance 11,224,226 A-share -4-

6 Statement on associated relationship or consistent action among the above shareholders: Among shareholders as listed above, the 2 nd and the 3 rd shareholders are holding enterprises of Shenzhen International Holdings Limited. Except for this, It is unknown whether other shareholders belong to related party or have associated relationship regulated by the Management Regulation of Information Disclosure on Change of Shareholding for Listed Companies Diagram of ownership structure and controlling relationships between the actual controller of the Company and the Company Applicable Inapplicable 5. Report of the Board of Directors 5.1 Discussion and analysis of the operation In 2011, the global political and economic situations were intricate, the world economic resurgence was sluggish, and the growth rate of major economic entities decreased. European debt crisis has become even more violent, and the deeper impact of international financial crisis has further revealed. China s economy not only was affected by the shrinking of external demand, but also was facing the influence of tightening fiscal and monetary policy caused by production over-capacity, control policy of real estate, and inflation, many enterprises were untenable. Confronting the ups and downs of economic environment, the Company took full advantages of various industrial, positively coped with the negative influences of marketing environment, further deepened the differentiation management tactic and consolidated management infrastructure. Under the leadership of the board of directors and with joint efforts of management and all staff, the Company realized revenue of RMB 8.27 billion, a raise of 6.8% compared with the same period of last year and made a historic record; realized net profit of RMB billion (deducted minority shareholders interest), and maintained relatively stable. Flat glass industry department: Influenced by national control policy of real estate, production over-capacity and price rising of raw materials & fuels, the flat glass industry has been facing the double pressure of price downward and cost rising in The whole industry has been at a losing state in the 4 th quarter and more than 30 production lines went into cold-repair or stopped. The flat glass industry department of the Company positively coped with the tough market environment, actively promoted the management level of subordinate companies, and continued to maintain the advanced level in industry for its profitability by strengthening cost control, upgrading technical reconstruction, lowering energy consumption and giving great impetus to differentiated products. At present, the successful productization of the Phase II of TCO conductive glass project of the Company immensely enhanced the competitiveness of CSG Holding in TCO conductive glass industry; two float glass production lines of Wujiang CSG have been put into operation in the second half of 2011, the industry distribution of the Company in glass filed is more perfect; panel glass project has successfully started trial operation and can steadily produce ultra-thin glass with thickness of 1.1mm. Architecture glass industry department: The architectural glass industry has continued a stable development trend in As the price of original float glass has dropped and the sales and production volume of coating products has raised by a wide margin, both rate of capacity utilization and profitability of architectural glass have been promoted. The superiority of industry distribution and economies of scale appeared. By taking advantage of coating technology, the architectural glass industry department made major adjustment for marketing system and operation mode. In the civilian market, they positively advanced the development of energy -5-

7 saving glass so that the sales volume of energy saving glass in civilian market has nearly doubled. In the public construction market, they positively popularized the application of 2 nd generation and 3 rd generation of low emissivity coated glass, so that the high added value of differentiated product could sufficiently reflect. In 2011, even though the economic environment was not optimistic, the department had a good performance, and its production value and profits had rather large growth. Fine glass industry department: Driven by rapid growth of market demand for touch panel product in 2011, the prosperity of fine glass industry promoted continually. The fine glass industry department has taken full advantage of development opportunity of the industry, effectively increased the output of high value-added capacitive touch panel as well as constantly promoted the rate of capacity utilization, and created impressive performance. In 2011, the department realized net profit of RMB 269 million, a raise of % compared with the same period of last year. The advantages of complementarities in the industry reflected. Solar energy industry department: The solar photovoltaic market has a transformation from strong to weak in Influenced by the European debt crisis and inconstant government subsidy policy, the demand for photovoltaic products in European market was restrained. Meanwhile, serious production over-capacity of photovoltaic industry led to a fierce price competition. The global photovoltaic industry suffered a freezing winter, many domestic medium and small enterprises were forced to stop production, and the industry confronted reshuffle. Facing the extremely adverse marketing environment, the solar energy industry department has successfully controlled the production cost of polysilicon within USD30/kg by constant technological innovation and process optimization, although the prices of raw materials and energy sources were keeping up. At the same time, as processing cost of cells and modules kept dropping, and the output of antireflection coating of solar energy glass industry substantially kept increasing, the comprehensive competitiveness of solar energy of the Company was effectively strengthened, and played an important role in resisting the cruel homogenization competition in photovoltaic industry for the Company. 5.2 Main operations classified according to industries or products Industry Main operating income Cost of sales Main operation classified according to products Gross profit margin Percentage change in operating change in cost of income compared to 2010 Percentage Unit: RMB 0000 sales compared Percentage change in gross profit to 2010 compared to 2010 (%) Flat glass industry 314, , % -1.22% 23.71% Decrease percentage points Architectural glass industry 247, , % 9.45% 2.78% Increase 4.26 percentage points Fine glass industry 93,471 53, % 45.26% 24.54% Increase 9.54 percentage points Solar energy industry 226, , % 0.41% 3.78% Decrease 2.14 percentage points 5.3 Reasons for major changes on profit constitution, main business and structures as well as profitability for main business compare with year-earlier period Applicable Inapplicable In the report period, suffering from double influence of lowering price of float glass and soaring cost, gross margin of flat glass industry declined compare with the same time of last year. Fine glass industry has a dramatically increase of income due to the increasing volume of production and sales in high value-added products. -6-

8 6. Financial Report 6.1 Explanation on changes in accounting policy, estimates and methods compared with the previous annual report Applicable Inapplicable 6.2 Contents, amount corrected, reason and its influence of significant accounting errors Applicable Inapplicable 6.3 Explanation on the changes of consolidated scope compared with the previous annual report Applicable Inapplicable A. On 28 December 2010, Heyuan CSG PV Encapsulation Material Co., Ltd. was established with 100% equity held by the Company in Heyuan, Guangdong. Construction work didn t start because the certificate of right in land hasn t being obtained. B. On 17 March 2011, Xianning CSG Glass Co., Ltd. was established with 94.06% equity held by the Company in Xianning, Hubei. End of 31 December 2011, the company is in preparation. C. On 5 May 2011, Qingyuan CSG Energy Conservation New-materials Co., Ltd. was established with 100% equity held by the Company in Qingyuan, Guangdong. End of 31 December 2011, the company is in preparation. D. In July 2011, Shenzhen CSG Wellight Conductive Coating Glass Co., Ltd. purchased 100% equity of Shenzhen Sunlord Electronics Co., Ltd. with price of RMB 15 million and changed its name as Shenzhen CSG Hongxu Technology Co., Ltd. on 12 October This company was excluded in consolidation for no material business activities occurred. E. Dongguan CSG Ceramics Technology Co., Ltd. was excluded in consolidation range for equity has been sold in the report period. 6.4 Explanation from the Board of Directors and Supervisory Committee on the non-standard audit report presented by the certified public accountants Applicable Inapplicable Board of Directors of CSG Holding Co., Ltd. 27 March