China Jushi FY2002: Operating risks and business commitments

The report describes irregularities in Jushi Group's earlier joint-venture formation: contributed net assets had not initially been appraised, and an equity change had occurred without board consideration. A foreign-investment approval certificate obtained on 29 March 2002 had shown the listed company at 48.04%. The issuer says it subsequently completed appraisal, government approval and registration changes confirming its 56.51% registered equity stake. The reassessed contributed net assets were CNY 236.4336 million, with the surplus treated as a receivable. Separately, because the foreign shareholder paid its contribution in installments, the listed company reports a 72.88% FY2002 entitlement to Jushi Group's equity or earnings based on actual contributions. The 48.04% earlier approval, 56.51% confirmed registered stake and 72.88% actual-contribution-based entitlement describe different dates and bases; none should replace the others in an ownership or profitability time series. The report attributes the remedial steps to the issuer; this extraction is not an independent legal validation.

Under a three-party restructuring agreement dated 28 June 2002, CCBM converted CNY 38.1648 million held at the affiliated finance company as of 27 June, including CNY 0.3674 million of interest, into a claim against the ultimate parent. The closing related-party schedule separately records CNY 38.16482754 million due from that ultimate parent, CNY 20.1 million due from the finance company, and CNY 1.54 million of loans plus CNY 1 million of building-purchase advances due from the building-materials import/export shareholder. The issuer says that shareholder had not repaid its opening funds and no usage fee was charged. Converting a deposit to a receivable did not establish cash recovery. The asset swap also transferred a separate CNY 9.70647213 million claim; this review does not equate it with the full closing parent claim or invent a missing reconciliation.

Related other receivable / 2002 / fy2002 ultimate parent transfer claim

RMB 38,164,827.54

Related other receivable / 2002 / fy2002 affiliated finance company claim

RMB 20,100,000

Related other receivable / 2002 / fy2002 import export shareholder loan

RMB 1,540,000

Nanjing New Materials was transferred as a whole for zero consideration, after negative audited net assets of CNY 0.66717141 million at 31 March; the report says registration changed on 14 November. The 80% Nanjing Jinbang Baiye stake was transferred at CNY 25.0862 million and registration changed on 25 November, but the entire share-price amount was still owed at the end of 2002. A 12 January 2003 subsequent confirmation extended payment to 30 June 2003; it was not a receipt. The related-party schedule gives a larger CNY 57.24337913 million amount due from the buyer for both equity and debt transfers, which must not be conflated with the equity price alone. On the funding side, the report states total closing amounts owed to Beixin Logistics of CNY 27.8625 million and a CNY 20.2268 million repayment on 8 January 2003, with the remainder still repayable. The January repayment is a subsequent issuer cash outflow, not recovery of disposal consideration.

The issuer's contingent-liability note reports guarantees of CNY 162 million short-term and CNY 184.1688 million long-term borrowing for Jushi Group, including CNY 25.955 million due within a year. Jushi Group separately guaranteed CNY 33.47 million short-term and CNY 45 million long-term debt for its Jiujiang company. These subsidiary guarantees must not be added to the parent amount as a single clean external group exposure, nor counted again as additional loans. The issuer also continued to disclose CNY 17.5 million guarantees for Jiangyin, CNY 10 million for Nanjing Jinbang Baiye, and CNY 20.55 million for Beijing Xiling after the disposal disclosures. Counterguarantees were reported for specified beneficiaries, but do not demonstrate release or recovery. A separate securities-investment loss-compensation guarantee was capped at CNY 18 million, with the issuer's securities account pledged and unable to close during the stated 27 March 2002-26 March 2003 term. The short-term investment note reports CNY 16.74766106 million net investments and says the stock/cash account was pledged. The cap, collateral book value, supported borrowing and any eventual loss are different measures; the stated expiry does not prove discharge.

Outgoing guarantee balance / 2002 / fy2002 parent jushi short guarantee

RMB 162,000,000

Outgoing guarantee balance / 2002 / fy2002 parent jushi long guarantee

RMB 184,168,800

Outgoing guarantee balance / 2002 / fy2002 parent jiangyin guarantee

RMB 17,500,000

Outgoing guarantee balance / 2002 / fy2002 parent nanjing jinbang guarantee

RMB 10,000,000

Outgoing guarantee balance / 2002 / fy2002 parent beijing xiling guarantee

RMB 20,550,000

CCBM sued the Pudong Great Wall building-materials counterparty and its parent on 19 September 2002 over occupied funds. The business narrative gives remaining principal of CNY 23.89 million plus about CNY 0.41 million usage fees and penalties, and says the court accepted the case and froze part of the defendants' property. The contingent-liability note instead specifies a CNY 26.44 million total claim, made up of CNY 23.86 million principal, CNY 0.4083 million usage fees and CNY 2.1717 million penalties. These two principal disclosures differ by CNY 0.03 million; the source does not reconcile them. Both are preserved here without choosing a corrected amount. Acceptance, freezing and a claim amount do not establish a favorable final judgment, settlement or cash collection. This historical reader does not backfill the later-year settlement into the 2002 case status.

A 30 May 2002 approval transferred 84.111 million shares, or 37.79% of CCBM, without consideration from the ultimate China New Building Materials Group to its wholly owned BNBM Group; the filing identifies BNBM as the direct controlling shareholder and retains the former holder as ultimate controller. This was a change of direct holder within the same group, not evidence of a new ultimate owner. Zhenshi held 22.26%. Issued share capital remained 222.6 million shares. The board proposed CNY 0.5 per ten shares, totaling CNY 11.13 million, with no bonus shares or reserve capitalization; it was a proposal at filing, not evidence of payment to shareholders. Routine meeting lists, director biographies and generic governance assurances are omitted from the reader; the specific joint-venture approval irregularities and related-party exposures are retained separately.