Annual Report 2007 Shanghai Jin Jiang International Hotels (Group) Company Limited 1 CONTENTS 2 Corporate Information 3 Information on Hotels of the Group 7 Major Awards 10 Financial Highlights 11 Operational Statistics 12 Corporate Structure 13 Definitions and Glossary of Technical Terms 16 Chairman’s Statement Management Discussion and Analysis 18 Operational review 18 Star-rated hotel operation 20 Jin Jiang Inn Budget Hotels 21 Star-rated hotel management 22 Food and restaurants 23 Marketing 23 Information technology 24 Business and Financial review 29 Group liabilities and financial conditions 29 Treasury management 30 Available-for-sale financial assets 30 Human resources and training 31 Social responsibility 32 Energy conservation 33 Corporate strategies and future outlook 36 Directors, Supervisors and Senior Management 42 Report of the Directors 54 Report of the Supervisory Committee 56 Corporate Governance Report 65 Independent Auditor’s Report 66 Consolidated Balance Sheet 68 Balance Sheet 70 Consolidated Income Statement 71 Consolidated Statement of Changes in Equity 72 Consolidated Cash Flow Statement 74 Notes to the Consolidated Financial Statements 2 Shanghai Jin Jiang International Hotels (Group) Company Limited Annual Report 2007 CORPORATE INFORMATION EXECUTIVE DIRECTORS STRATEGIC INVESTMENT LEGAL ADDRESS Mr. Yu Minliang (Chairman) COMMITTEE Room 316–318, Ms. Chen Wenjun Mr. Yang Weimin (Chairman) No. 24 Yang Xin Dong Road Mr. Yang Weimin (CEO) Mr. Chen Hao Shanghai, Mr. Chen Hao Dr. Rui Mingjie The People’s Republic of China Mr. Yuan Gongyao (the “PRC”) Mr. Xu Zurong AUTHORISED REPRESENTATIVES Mr. Han Min Mr. Yang Weimin PRINCIPAL PLACE OF BUSINESS Mr. Kang Ming Dr. Laurence Yuen Chin Yau, PhD, FCPA, FCS IN THE PRC 13th Floor, NON-EXECUTIVE DIRECTOR ALTERNATE TO AUTHORISED Youyou Yanqiao Building, Mr. Shen Maoxing (Vice Chairman) REPRESENTATIVES No. 489 Pudian Road, Ms. Chen Junjin Shanghai, the PRC INDEPENDENT NON-EXECUTIVE DIRECTORS INTERNATIONAL AUDITOR JOINT COMPANY SECRETARIAL Mr. Ji Gang PricewaterhouseCoopers OFFICE Mr. Xia Dawei 6/F., 51 Guangdong Road PRC AUDITOR Mr. Sun Dajian Shanghai, the PRC Deloitte Touche Tohmatsu CPA Ltd. Dr. Rui Mingjie PRINCIPAL PLACE OF BUSINESS IN Mr. Yang Menghua LEGAL ADVISERS HONG KONG Dr. Tu Qiyu As to Hong Kong law & US law: Room 3203, 32nd Floor Mr. Shen Chengxiang Baker & McKenzie Mr. Lee Chung Bo Shun Tak Centre, West Tower As to PRC law: 200 Connaught Road Central SUPERVISORS King and Wood Hong Kong Special Administrative Mr. Wang Xingze Region of the PRC (“Hong Kong”) (Chairman of Supervisory Committee) CHINESE NAME OF THE COMPANY Mr. Wang Guoxing 上海錦江國際酒店（集團）股份有限公司 STOCK EXCHANGE ON WHICH Mr. Ma Mingju H SHARES OF THE COMPANY Ms. Chen Junjin ENGLISH NAME OF THE COMPANY (“H SHARES”) ARE LISTED: Ms. Jiang Ping Shanghai Jin Jiang International Hotels Main board (“Main Board”) of Mr. Zhou Qiquan (Group) Company Limited The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) JOINT COMPANY SECRETARIES H SHARE REGISTRAR AND Dr. Laurence Yuen Chin Yau, PhD, FCPA, FCS TRANSFER OFFICE Abbreviation of H Shares: Mr. Kang Ming Computershare Hong Kong JINJIANG HOTELS Investor Services Limited Stock code: 02006 QUALIFIED ACCOUNTANT 46th Floor, Hopewell Centre, Website: www.jinjianghotels.com.cn Dr. Laurence Yuen Chin Yau, PhD, FCPA, FCS 183 Queen’s Road East, Hong Kong Tel: (86-21) 6326 4000 Fax: (86-21) 6321 7836 AUDIT COMMITTEE INVESTOR AND MEDIA RELATIONS Mr. Xia Dawei (Chairman) CONSULTANT Mr. Yang Menghua iPR Ogilvy Limited Mr. Sun Dajian PRINCIPAL BANKERS REMUNERATION COMMITTEE Industrial and Commercial Mr. Chen Hao (Chairman) Bank of China, Shanghai Branch Mr. Ji Gang Bank of China, Shanghai Branch Mr. Yang Menghua Annual Report 2007 Shanghai Jin Jiang International Hotels (Group) Company Limited 3 INFORMATION ON HOTELS OF THE GROUP STATISTICS OF HOTELS IN OPERATION Hotels in which Hotels in which the Group held the Group held Hotels owned by Hotels owned by hotel interests hotel interests third parties third parties but and managed but managed but managed granted franchises Total hotels in In operation by the Group by third parties by the Group by the Group operation Total Total Total Total Total Number number Number number Number number Number number Number number of hotels of rooms of hotels of rooms of hotels of rooms of hotels of rooms of hotels of rooms As at 31 December 2007 Hotel Category Landmark Hotels 6 1,613 —————— 61,613 Luxury Hotels (excluding Landmark Hotels) — 5-star hotels 4 2,497 2 974 10 3,518 — — 16 6,989 — 4-star hotels 7 3,271 2 944 26 5,891 — — 35 10,106 Subtotal 11 5,768 4 1,918 36 9,409 — — 51 17,095 Commercial Hotels — 3-star hotels 8 1,839 — — 9 1,942 — — 17 3,781 — 2-star hotels 3 472 — — 1 100 — — 4 572 Subtotal 11 2,311 — — 10 2,042 — — 21 4,353 Jin Jiang Inn Budget Hotels 67 11,042 ————9312,097 160 23,139 Total 95 20,734 4 1,918 46 11,451 93 12,097 238 46,200 As at 31 December 2006 Hotel Category Landmark Hotels 6 1,619 —————— 61,619 Luxury Hotels (excluding Landmark Hotels) — 5-star hotels 3 2,148 2 974 6 1,797 — — 11 4,919 — 4-star hotels 7 3,278 2 944 24 5,466 — — 33 9,688 Subtotal 10 5,426 4 1,918 30 7,263 — — 44 14,607 Commercial Hotels — 3-star hotels 9 2,215 — — 10 1,904 — — 19 4,119 — 2-star hotels 3 472 — — 1 100 — — 4 572 Subtotal 12 2,687 — — 11 2,004 — — 23 4,691 Jin Jiang Inn Budget Hotels 41 6,378 ————506,567 91 12,945 Total 69 16,110 4 1,918 41 9,267 50 6,567 164 33,862 4 Shanghai Jin Jiang International Hotels (Group) Company Limited Annual Report 2007 INFORMATION ON HOTELS OF THE GROUP STATISTICS OF HOTELS UNDER DEVELOPMENT Hotels in which Hotels in which the Group held the Group held Hotels owned by Hotels owned by hotel interests hotel interests third parties third parties but Total and managed but managed but managed granted franchises hotels under Under development by the Group by third parties by the Group by the Group development Total Total Total Total Total Number number Number number Number number Number number Number number of hotels of rooms of hotels of rooms of hotels of rooms of hotels of rooms of hotels of rooms As at 31 December 2007 Hotel Category Landmark Hotels —————————— Luxury Hotels (excluding Landmark Hotels) — 5-star hotels 1 250 — — 13 4,062 — — 14 4,312 — 4-star hotels ———— 83,069 — — 8 3,069 Subtotal 1 250 — — 21 7,131 — — 22 7,381 Commercial Hotels — 3-star hotels —————————— — 2-star hotels —————————— Subtotal —————————— Jin Jiang Inn Budget Hotels 50 7,687 ————707,529 120 15,216 Total 51 7,937 — — 21 7,131 70 7,529 142 22,597 As at 31 December 2006 Hotel Category Landmark Hotels —————————— Luxury Hotels (excluding Landmark Hotels) — 5-star hotels 2 650 — — 12 4,170 — — 14 4,820 — 4-star hotels ———— 92,450 — — 9 2,450 Subtotal 2 650 — — 21 6,620 — — 23 7,270 Commercial Hotels — 3-star hotels —————————— — 2-star hotels —————————— Subtotal —————————— Jin Jiang Inn Budget Hotels 47 8,213 ————434,870 90 13,083 Total 49 8,863 — — 21 6,620 43 4,870 113 20,353 Annual Report 2007 Shanghai Jin Jiang International Hotels (Group) Company Limited 5 INFORMATION ON HOTELS OF THE GROUP STATISTICS OF REGIONAL DISTRIBUTION In operation Under development Jin Jiang Inn Jin Jiang Inn Star-rated hotels Budget Hotels Star-rated hotels Budget Hotels Province/autonomous region/ No. of Total No. No. of Total No. No. of Total No. No. of Total No. municipality hotels of rooms hotels of rooms hotels of rooms hotels of rooms Eastern region Shanghai 32 10,813 47 6,743 1 880 21 2,505 Zhejiang 2 593 13 1,752 — — 11 1,284 Jiangsu 8 2,093 37 4,762 2 610 17 1,902 Anhui 1 198 3 378 — — 4 355 Shandong 1 200 7 876 4 1,140 9 957 Northern region Beijing 15 3,561 12 2,034 1 462 6 812 Tianjin 1 314 5 807 — — 4 592 Hebei 4 914 2 282 3 885 — — Liaoning 1 320 4 696 1 420 3 551 Jilin — — 1 157 — — 1 137 Heilongjiang 1 164 2 291 2 519 2 176 Central region Henan 1 277 5 792 — — 3 474 Hubei 2 472 3 686 1 240 1 86 Hunan —————— 5641 Jiangxi 2 375 3 371 1 360 3 467 Guangxi —————— 2385 Southern region Fujian — — 1 92 1 300 7 775 Guangdong 1 420 3 570 1 350 4 524 Hainan 1 243 1 283 1 300 — — Northwestern region Shanxi 1 398 1 164 — — 6 974 Shaanxi — — 4 538 — — 3 308 Gansu 1 236 —————— Qinghai — — 1 155 — — 1 140 Xinjiang —————— 1150 Inner Mongolia 1 900 ———— 1240 Ningxia —————— 1150 Southwestern region Chongqing — — 2 257 1 315 — — Sichuan — — 3 453 2 600 2 369 Guizhou 1 250 ———— 1192 Yunnan 1 320 —————— Tibet —————— 170 Total 78 23,061 160 23,139 22 7,381 120 15,216 6 Shanghai Jin Jiang International Hotels (Group) Company Limited Annual Report 2007 INFORMATION ON HOTELS OF THE GROUP Star-rated Hotels in which the Group holds substantial interests (Note) Effective interests held Total Number Name of hotels by the Company of rooms Landmark Hotels Jin Jiang Hotel 100.00% 434 Peace Hotel 100.00% 260 Park Hotel 100.00% 244 Pacific Hotel 100.00% 189 New Asia Hotel 50.31% 344 Metropole Hotel 50.31% 142 5-star hotels Jin Jiang Tower 100.00% 648 Huating Hotel & Towers 50.00% 803 Jin Jiang Tomson Hotel 25.16% 421 Renaissance Yangtze Shanghai Hotel 20.12% 553 Kunlun Hotel 47.41% 646 Wuhan Jin Jiang International Hotel 75.16% 400 4-star hotels Jian Guo Hotel 32.70% 454 Galaxy Hotel 100.00% 666 Rainbow Hotel 100.00% 642 Cypress Hotel 100.00% 149 Shanghai Hotel 100.00% 755 Sofitel Hyland 33.54% 401 New Asia Plaza Great Wall Hotel 100.00% 543 Wuxi Jin Jiang Grand Hotel 25.00% 285 Kunming Jin Jiang Hotel 99.83% 320 3-star hotels Peace Palace Hotel 100.00% 103 New Garden Hotel 57.00% 310 Jinsha Hotel 100.00% 294 Da Hua Hotel 100.00% 90 Y.M.C.A Hotel 100.00% 159 Hua Ting Guest House 100.00% 190 Zhongya Hotel 22.64% 388 Jiangsu Jin Jiang Nanjing Hotel 40.00% 305 2-star hotels East Asia Hotel 50.31% 167 Nanjing Hotel 50.31% 165 Min Hang Hotel 50.31% 140 Note: 20% or more equity interests directly and indirectly held by the Company.