China Jushi FY2005: Subsidiaries and invested companies

The listed company held 59.90% of Jushi Group at the 2005 year end, following a 3.39-percentage-point share acquisition from SUREST FINANCE LIMITED approved in June. The subsidiary note separately reports USD 65.9808 million actually contributed by the listed company, or 66.81% of the capital that had actually been paid in. Some foreign shareholders had not completed their contributions. The 66.81% paid-contribution ratio therefore does not replace the registered 59.90% equity interest or establish a corresponding share of every consolidated profit figure. The planned proportional capital increase was USD 63.2 million, bringing registered capital to USD 110.1516 million. Its registration and the arrival of every shareholder payment are different milestones. These capital figures are not the budget, construction expenditure or cash cost of the individual glass-fiber lines.

Jushi Group, the 59.90%-owned glass-fiber and composite-materials business, reported CNY 3,221.685 million of total assets and CNY 185.575 million of net profit in the subsidiary-performance discussion. That paragraph does not identify the figures as a separate-entity-only income statement, and they are not the listed company's CNY 123.476 million shareholders' profit. BNBM Technology, held 95%, operated in new materials, distribution and industrial investment, reporting CNY 199.171 million of assets and CNY 1.107 million of net profit. The listed company also held 80% and 96% of two Beijing home-furnishings market operators. Its 20%-owned BNBM Logistics investment covered home-product distribution, chain retail, logistics, commercial property and trade, reporting CNY 1,085.255 million of assets and CNY 38.540 million of net profit for that investee. These investee figures should not be summed, or multiplied mechanically by holdings, to derive consolidated profit: reporting layers, subsidiary interests, eliminations and equity-accounting adjustments differ. The listed group's operations were therefore broader than glass fiber alone, even though glass fiber was its principal product business.

Reported subsidiary assets / 2005 / jushi group reported assets

RMB 3,221,685,400

Reported subsidiary net profit / 2005 / jushi group reported net profit

RMB 185,574,900

Reported subsidiary assets / 2005 / bnbm technology reported assets

RMB 199,171,000

Reported subsidiary net profit / 2005 / bnbm technology reported net profit

RMB 1,106,900

Reported subsidiary assets / 2005 / bnbm logistics investee reported assets

RMB 1,085,255,200

Reported subsidiary net profit / 2005 / bnbm logistics investee reported net profit

RMB 38,539,500

The FY2005 electronic-project discussion names the Jushi/P-D electronic yarn and cloth joint venture and expects production in the fourth quarter of 2006. Separately, the equity-method investment table lists a Jushi Panden electronic-base-materials company with a 57% interest and CNY 22.99323 million of investment cost and closing book value, with no profit adjustment shown for that entry. The wording and related project context are retained as source evidence, but this annual report alone does not explicitly establish that the differently rendered names are the same legal entity. The 57% investment-table interest therefore is not automatically assigned as a field of the named electronic project, and the investment cost is not its total factory budget. The table's equity-method treatment is also preserved rather than inferring consolidation solely from a percentage above 50%. This explains the disclosed accounting and naming boundary without extending research into the partner's business.

The listed company's separate parent statements show a different earnings model from the consolidated manufacturing business. The parent reports no main-business revenue, and CNY 5.667 million of other-business profit from technical service fees. Its CNY 6.74529459 million operating loss was offset by CNY 139.28295082 million of investment income, producing CNY 132.53765623 million of parent net profit. The investment note reconciles that income to CNY 139.51518190 million of adjustments for investees' changes in equity, less CNY 0.23223108 million of equity-investment-difference amortization. Jushi Group's profit-adjustment addition of CNY 116.48847669 million is one entry within that parent investment accounting, not the whole subsidiary's operating profit and not an extra amount to add to consolidated earnings. Parent long-term equity investments had CNY 1,157.58774306 million of closing net book value, including the historical investment differences. Parent administrative expense was negative CNY 2.26157286 million; the separate impairment schedule reports CNY 15.92610743 million of other-receivable allowance reversal. That reversal is not a new customer sale or cash receipt. These are historical parent-only figures under the filing's accounting basis, separate from the consolidated owner's CNY 123.47642880 million profit.

Operating profit / 2005 / parent only operating profit

RMB -6,745,294.59

Consolidated investment income or loss / 2005 / parent only investment income

RMB 139,282,950.82

Reported net profit / 2005 / parent only net profit

RMB 132,537,656.23

Equity method result / 2005 / parent only jushi profit adjustment

RMB 116,488,476.69

Long term investments net / 2005 / parent only long term equity investments

RMB 1,157,587,743.06