2011 Annual Report
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CSG HOLDING CO., LTD. 2011 ANNUAL REPORT Chairman of the Board: ZENG NAN March 2012 CSG Holding Co., Ltd. 2011 Annual Report Important Note 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. Because independent director Wang Tianguang was on business trip, he authorized independent director Chen Chao to vote as his behalf. PricewaterhouseCoopers Zhongtian Certified Public Accountants Co., Ltd audited the Annual Financial Report 2011, and issued standard and unqualified Auditor’s Report for the Company. 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. This report is prepared both in Chinese and English. Should there be any inconsistency between the Chinese and English versions, the Chinese version shall prevail. CONTENTS §1 Company Profile _____________________________________________________________2 §2 Financial Data Highlights ______________________________________________________3 §3 Change in Share Capital and Particulars about the Shareholders _____________________5 §4 Particulars about the Directors, Supervisors, Senior Executives and Employees_________9 §5 Corporate Governance Structure_______________________________________________14 §6 Brief Introduction of Shareholders' General Meetings _____________________________20 §7 Report of the Board of Directors _______________________________________________21 §8 Report of the Supervisory Committee___________________________________________38 §9 Important Events____________________________________________________________40 §10 Financial Reports __________________________________________________________48 §11 Documents for Reference_____________________________________________________145 -1- CSG Holding Co., Ltd. 2011 Annual Report §1 Company Profile I. Registered Name of the Company In Chinese: 中国南玻集团股份有限公司(Abbr: 南玻集团) In English: CSG Holding Co., Ltd. (Abbr: CSG) II. Legal Representative: Zeng Nan III. Secretary of the Board of Directors: Wu Guobin Securities Affairs Representative: Zhou Hong Address: CSG Building, No.1, the 6th Industrial Road, Shekou, Shenzhen, P.R.C. Tel: (86) 755-26860666 Fax: (86) 755-26692755 E-mail: [email protected] IV. Registered office address of the Company: CSG Building, No.1, the 6th Industrial Road, Shekou, Shenzhen, P. R. C. Post Code: 518067 Company’s website: http://www.csgholding.com E-mail: [email protected] V. Newspapers for disclosing the information: Securities Times, China Securities Journal, and Hong Kong Commercial Daily. Website for publishing the Annual Report: http://www.cninfo.com.cn The place where the Annual Report is prepared and kept: Securities Department of the Company VI. Stock Exchange Listed with: Shenzhen Stock Exchange Short form of the stock and stock code (A-share): Southern Glass A (000012) Short form of the stock and stock code (B-share): Southern Glass B (200012) VII. Other Information about the Company i Initial business registration date: September 10, 1984 ii Initial registration authority: Shenzhen Administration for Industry and Commerce iii Business license number: 440301501125544 iv Reference number of tax: 440300618838577 v Code of Organization Certificate: 61883857-7 vi Certified public accountants engaged by the Company Name: Pricewaterhouse Coopers Zhongtian Certified Public Accountants Co., Ltd. Address: 11/F, PricewaterhouseCoopers Center, No.202 Hubin Rd. Shanghai, P.R.C. -2- CSG Holding Co., Ltd. 2011 Annual Report §2 Financial Data Highlights I. Major accounting data over the past three years Unit: RMB Percentage change 2011 2010 between 2011 and 2010 2009 Revenue 8,270,731,730 7,743,941,694 6.80% 5,279,100,133 Operating profit 1,501,575,318 1,833,110,220 -18.09% 1,072,791,061 Total profit 1,637,980,229 1,865,346,701 -12.19% 989,064,781 Net profit attributable to equity holders of the 1,178,229,197 1,455,209,218 -19.03% 831,944,393 Company Net profit attributable to equity holders of the 1,067,580,683 1,386,137,343 -22.98% 881,934,137 Company after extraordinary gains and losses Net cash flows from operating activities 1,688,530,164 2,366,313,914 -28.64% 1,670,237,426 Percentage change on 31 Dec. 2011 compared 31 Dec. 2011 31 Dec. 2010 to 31 Dec. 2010 31 Dec. 2009 Total assets 15,281,391,077 12,469,619,167 22.55% 10,913,350,017 Total liabilities 7,975,456,538 5,710,400,818 39.67% 5,302,276,985 Total equity attributable to equity holders of the 6,911,117,984 6,384,871,209 8.24% 5,315,523,161 Company Capital 2,075,837,060 2,076,721,060 -0.04% 1,223,738,124 II. Major financial indices over the past three years Unit: RMB Percentage change between 2011 2010 2011 and 2010 2009 Basic earnings per share Note 0.57 0.70 -18.57% 0.40 Diluted earnings per share Note 0.57 0.70 -18.57% 0.40 Basic earnings per share after extraordinary gains 0.51 0.67 -23.88% 0.42 and losses Note Weighted average return on equity (%) 17.94% 25.04% Decrease 7.10 percentage points 16.86% Weighted average return on equity after 16.25% 23.85% Decrease 7.60 percentage points 17.87% extraordinary gains and losses (%) Net cash flows from operating activities per share 0.81 1.14 -28.95% 1.36 Percentage change on 31 Dec. 31 Dec. 2011 31 Dec. 2010 2011 compared to 31 Dec. 2010 31 Dec. 2009 Total assets per share for equity holders of the 3.33 3.07 8.47% 4.34 Company 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. -3- CSG Holding Co., Ltd. 2011 Annual Report III. Items of extra ordinary gains and losses Unit: RMB 2011 Note 2010 2009 Gains and losses on disposal of non-current -1,940,045 -11,165,417 -107,764,956 assets Government subsides recognized as gains 120,129,140 33,675,322 23,865,251 and losses Gains on disposal of available-for-sale 0 9,055,042 17,538,302 financial assets Net income of Share Transfer 4,392,843 In March 2011, 100% equity 40,359,075 0 of 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 9,726,576 173,425 Tax effects -21,048,058 -11,578,309 19,237,132 Extraordinary gains and losses of minority -9,101,182 -1,000,414 -3,038,898 interests (after tax) Total: 110,648,514 - 69,071,875 -49,989,744 -4- CSG Holding Co., Ltd. 2011 Annual Report §3 Change in Share Capital and Particulars about the Shareholders I. Change in share capital i. In the report period, the changes on share capital are as follows: Unit: Share Increase/Decrease in the Before the change period (+/-) After the change Amount Proportion Other Sub-total Amount Proportion I. Restricted shares 39,651,513 1.91% -16,230,629 -16,230,629 23,420,884 1.13% 1) State-owned shares 0 0 0 0 0 0 2) State-owned legal person’s shares 0 0 0 0 0 0 3) Other domestic shares 38,148,000 1.84% -19,516,000 -19,516,000 18,632,000 0.90% Including: - Domestic legal person’s shares 0 0 0 0 0 0 - Domestic natural person’s shares 38,148,000 1.84% -19,516,000 -19,516,000 18,632,000 0.90% 4) Foreign-owned shares 0 0 0 0 0 0 Including: - Foreign legal person’s shares 0 0 0 0 0 0 - Foreign natural person’s shares 0 0 0 0 0 0 5) Senior executive shares 1,503,513 0.07% 3,285,371 3,285,371 4,788,884 0.23% II. Unrestricted shares 2,037,069,547 98.09% 15,346,629 15,346,629 2,052,416,176 98.87% 1) RMB Ordinary shares 1,274,485,555 61.37% 15,346,629 15,346,629 1,289,832,184 62.14% 2) Domestic listed foreign shares 762,583,992 36.72% 0 0 762,583,992 36.74% 3) Overseas listed foreign shares 0 0 0 0 0 0 4) Others 0 0 0 0 0 0 III. Total shares 2,076,721,060 100% -884,000 -884,000 2,075,837,060 100% -5- CSG Holding Co., Ltd. 2011 Annual Report ii. The changes of restricted shares in the report period Unit: Share Restricted Amount Amount of Name of the amount held converted restricted Restricted Date of the restricted in the to tradable shares increased amount held at Reason of rest shareholders year-begin in 2011 in 2011 the year-end being restricted conversions Zeng Nan 3,400,000 1,700,000 1,675,291 3,375,291 Senior executive shares 2011.6.24 and Stock Incentive Luo Youming 1,360,000 680,000 662,500 1,342,500 Senior executive shares 2011.6.24 and Stock Incentive Ke Hanqi 1,360,000 680,000 617,500 1,297,500 Senior executive shares 2011.6.24 and Stock Incentive Wu Guobin 1,360,000 680,000 677,500 1,357,500 Senior executive shares 2011.6.24 and Stock Incentive Zhang Fan 1,360,000 680,000 467,500 1,147,500 Senior executive shares 2011.6.24 and Stock Incentive Lu wenhui 510,000 255,000 175,312 430,312 Senior executive shares 2011.6.24 and Stock Incentive Ding Jiuru 1,275,000 637,500 513,281 1,150,781 Senior executive shares 2011.6.24 and Stock Incentive Key staffs 27,523,000 14,203,500 0 13,319,500 Stock Incentive 2011.6.24 Note: In January 2011, the range of tradable shares held by senior executives has been re-category, 600,388 executive’s restricted shares originally held by Mr.