China Jushi | FY2007 business review

The 2007 report describes glass fiber and other new materials as the main business and states annual glass fiber production capacity above 500,000 tonnes. Operating revenue was RMB 3.2008674 billion. Jushi Group was a 51%-owned subsidiary by the ownership table. These quantities describe a growing manufacturing business, while the subsidiary ownership and consolidated revenue have separate scopes. The company's stated global capacity ranking is treated as its own assessment.

Jushi Group reported 20 newly initiated science and technology projects, five provincial projects under implementation and 12 newly filed patent applications accepted by the patent authority. Annual research expenditure first exceeded RMB 100 million. The report also says single-bottom 1,600-hole and 2,400-hole platinum bushings had been used on production lines, with an 8% reduction in electricity consumption per tonne of yarn. That saving is the company's reported result for the described bushing application, not a group-wide reduction in every energy input.

On 4 January 2007, Jushi Group agreed to purchase ownership of the Jushi trademark from Zhenshi Group for CNY 30 million. The accounting note states a ten-year amortization period. Although the asset table labels its row as a trademark-use fee, the explanatory footnote explicitly describes the purchase of ownership. The row reports CNY 30.390 million gross value, CNY 3.039 million accumulated amortization and CNY 27.351 million closing net value. The reported gross carrying amount differs from the contract price; the filing does not provide a bridge and the two measures are preserved separately. Another CNY 4.933 million intellectual-property asset was contributed by a shareholder of Jushi South Africa. That is a disclosed capital contribution in rights, not evidence that the listed group spent the same amount on research during FY2007. The note does not specify patents, technical performance, legal territory or the manufacturing capacity supported by that contribution.

Management described tank-furnace drawing supported by fieldbus process controls, electric boosting, oxygen combustion and furnace bubbling, together with large bushings, winding equipment and drying equipment. The report links Tongxiang's position near Shanghai port to imports of equipment and some raw materials and to exports of finished glass fiber, and says that key raw materials sourced within Zhejiang offered a transport advantage. These are the company's explanations of manufacturing and logistics advantages, not an independently measured cost advantage over every competitor. Its oxygen-combustion research and application project reported cumulative energy savings of 57% and an 80% reduction in exhaust-gas volume. The filing does not specify a measurement baseline, operating interval or equivalent group-wide intensity measure for those percentages, and reduced gas volume does not by itself quantify lower emissions of each pollutant. Separately, the reported 8% reduction in electricity per tonne of yarn applies to the single-bottom 1,600-hole and 2,400-hole bushing application. These technical claims explain the specific process changes disclosed; they should not be combined into one saving percentage or described as uniform savings across all production and energy sources.

Glass fiber and related-product revenue was RMB 3.112873552 billion. Reported domestic revenue was RMB 1.696569198 billion and foreign revenue RMB 1.504298239 billion. The top five customers represented 30.12% of sales, while the top five suppliers represented 34.23% of procurement. The filing discusses wind-energy, boats, automotive and construction uses as market context; these application categories are not a list of Jushi's named customer contracts.

Glass fiber and related products generated CNY 3.113 billion of FY2007 revenue. The product tables in both the management report and the financial notes give cost of CNY 2.079 billion; revenue less that cost implies a margin of about 33.20%. The management table reports a 2.44 percentage-point improvement from the prior year. Other products contributed CNY 87.994 million of revenue and CNY 61.103 million of cost. A separate paragraph on the same management page instead describes glass-fiber cost as CNY 2.0715494 billion and a margin of 33.45%. That difference appears in the original image and is not simply a text-extraction error. The tabulated cost also reconciles with the consolidated total when other-product cost is added. This review uses the explicitly identified table basis and preserves the conflicting narrative; it does not treat the higher margin as a second product segment or silently correct the filing.

Reported glass-fiber and related-product revenue / 2007 / fy2007 consolidated glass fiber revenue

RMB 3,112,873,551.57

Reported glass-fiber and related-product cost / 2007 / fy2007 consolidated glass fiber table cost

RMB 2,079,398,357.08

Reported glass-fiber and related-product revenue / 2007 / fy2007 consolidated other products revenue

RMB 87,993,885.02

Reported glass-fiber and related-product cost / 2007 / fy2007 consolidated other products cost

RMB 61,102,504.51

Management described a global sales network with customer relationships in more than 70 countries and an annual November meeting at Tongxiang to discuss the following year's orders. Its main operating concerns included exchange-rate movements, rising energy and raw-material costs, borrowing associated with capacity expansion and reduced export tax rebates. These disclosures explain the commercial and cost environment surrounding the new capacity; they do not quantify a long-term contracted order book.

Related operating sales in FY2007 included CNY 293.813 million to GIBSON INTERPRISES INC, or a reported 9.18% of sales, CNY 110.956 million to Tongxiang Hengshi Fiber Base and CNY 53.920 million to the Jushi Panden electronic-substrate joint venture. The relationship note connects Gibson to the same legal representative as a foreign shareholder of Jushi Group and identifies Hengshi as a subsidiary of an issuer shareholder. Gibson's sales were CNY 303.291 million in the comparative year, so its reported share fell even as total group sales increased. On procurement, the group reported CNY 107.185 million of goods or services from Tongxiang Jinshi Precious Metal Equipment and CNY 100.195 million from Tongxiang Leishi Micro Powder, both linked in the relationship note to shareholder-controlled companies. Their reported purchase shares were 6.90% and 6.45%, respectively. These are named operating transactions, distinct from the subsidiary capital subscription and investment sales. The note says pricing followed market prices, while management also cited transaction approvals; those disclosures do not constitute this site's independent assessment of fairness. The report records additional related operating balances even though management stated no funds were occupied by the controlling shareholder. A statement about that specific funding category does not mean that all related receivables or trading relationships were zero.

Reported related-party sales transaction / 2007 / fy2007 related operating sales gibson

RMB 293,813,149.76

Reported related-party sales transaction / 2007 / fy2007 related operating sales hengshi

RMB 110,956,410.91

Reported related-party sales transaction / 2007 / fy2007 related operating sales panden

RMB 53,920,001.03

Reported related-party purchase or service transaction / 2007 / fy2007 related operating purchases jinshi

RMB 107,184,903.16

Reported related-party purchase or service transaction / 2007 / fy2007 related operating purchases leishi

RMB 100,194,667.7

The FY2007 report listed four non-fundraising investment projects with expected commissioning during 2008. Two were separately listed 140,000-tonne-per-year alkali-free glass-fiber tank-furnace drawing projects at Tongxiang: the first had a stated investment amount of CNY 1.6749234 billion and was expected to start production before the end of June 2008; the second had CNY 1.750087 billion and a deadline before the end of August 2008. Chengdu plans comprised a 40,000-tonne alkali-free line with imports of key equipment, CNY 488.6437 million and an expected start before the end of March 2008, and a 60,000-tonne medium-alkali line, CNY 611.781 million and an expected start before the end of July 2008. These source amounts describe the listed investment plans, rather than cash spent during FY2007. Their dates were expectations recorded in this report, not evidence of subsequent commissioning. The report does not assign line numbers to these four entries. The two similar Tongxiang descriptions are kept distinct, and the planned Chengdu 40,000-tonne project is not equated merely by capacity with the Chengdu project already described as commissioned in FY2007.

The construction note separately identifies Jushi Group project 215 as a 120,000-tonne production line and Chengdu projects 214 and 217 as 40,000-tonne production lines. During FY2007, CNY 904.766 million for project 215, CNY 3.773 million for 214 and CNY 467.123 million for 217 were transferred to fixed assets; each had no closing construction balance. A transfer is an accounting classification and does not supply an exact commissioning date or prove that the three amounts were incremental capacity delivered during the year. Two Jushi Group 140,000-tonne entries remained separately recorded: project 216 closed at CNY 725.914 million and project 218 at CNY 2.105 million. Project 216 had CNY 820.076 million of annual additions and CNY 94.162 million of reductions, with no transfer to fixed assets in that reduction column. Across all projects, construction in progress moved from CNY 34.315 million to CNY 743.741 million after CNY 2.215 billion of additions and CNY 1.505 billion of reductions; transfers to fixed assets were only part of the reductions. Project codes, closing balances and planned capacities are different identifiers and measures, so these rows are not assigned to later numbered lines without explicit supporting evidence.

Reported construction opening balance / 2006 / fy2007 all construction opening

RMB 34,314,505.75

Reported construction closing balance / 2007 / fy2007 all construction closing

RMB 743,741,072.28

Reported construction carrying-value additions / 2007 / fy2007 all construction additions

RMB 2,214,709,238.84

Reported construction transfer to fixed assets / 2007 / fy2007 all construction transfers

RMB 1,411,120,562.63

China Fiberglass, the listed issuer now known as China Jushi, reported consolidated FY2007 revenue of CNY 3.201 billion, compared with CNY 2.041 billion in the restated FY2006 comparative column of this filing. Management attributed the increase to commissioning Jushi Group's 120,000-tonne line and a 40,000-tonne Chengdu line, which increased production and sales. These are annual design capacities, not the tonnes actually sold during the year. The reported revenue amounts imply growth of about 56.83%, as stated in the management report; the revenue note instead prints 56.38%. Consolidated net profit was CNY 633.749 million, comprising CNY 308.620 million attributable to the parent's shareholders and CNY 325.129 million attributable to minority shareholders. The latter interests are included in consolidated operations but do not belong to the listed issuer's shareholders. These are the figures as presented in this original FY2007 filing; later comparative revisions remain separate historical records.

Revenue / 2007 / fy2007 consolidated operating revenue

RMB 3,200,867,436.59

Revenue / 2006 / fy2007 consolidated operating revenue comparative

RMB 2,040,995,771.89

Reported consolidated net profit / 2007 / fy2007 consolidated net profit original

RMB 633,749,021.77

Profit attributable to subsidiary minority / 2007 / fy2007 consolidated minority profit original

RMB 325,128,698.51

Consolidated FY2007 operating cash inflow net of operating payments was CNY 604.444 million, up from CNY 323.289 million. Cash spent acquiring or constructing fixed assets, intangible assets and other long-term assets was CNY 1.288 billion, so that spending exceeded operating cash generation. Net investing cash outflow was CNY 1.188 billion after investment recoveries and asset or business disposals. Net financing inflow was CNY 974.952 million: the group received CNY 695.235 million of investment cash, all shown as investment from minority shareholders into subsidiaries, and CNY 3.063 billion of new borrowing; it repaid CNY 2.484 billion of debt and paid CNY 299.472 million in the combined dividend, profit-distribution and interest category. Those subsidiary investment receipts are not an issuance of shares by the listed parent. After a CNY 5.332 million adverse exchange-rate effect, the cash-flow statement reported a CNY 385.859 million increase and closing cash and cash equivalents of CNY 989.158 million. Cash investment payments, construction-account additions and transfers to fixed assets measure different stages and should not be used interchangeably.

Net cash from operating activities / 2007 / fy2007 consolidated operating cash

RMB 604,443,878.94

Reported cash capital expenditure / 2007 / fy2007 consolidated long lived asset cash

RMB 1,287,770,655.38

Net cash from investing activities / 2007 / fy2007 consolidated investing cash

RMB -1,188,205,570.08

Net cash from financing activities / 2007 / fy2007 consolidated financing cash

RMB 974,952,234.97

Minority investment cash / 2007 / fy2007 consolidated minority subscription cash

RMB 695,234,633.71

Reported cash borrowing receipts / 2007 / fy2007 consolidated borrowing cash

RMB 3,063,259,652.89

Reported cash debt repayments / 2007 / fy2007 consolidated debt repayment cash

RMB 2,484,069,846

Reported cash change / 2007 / fy2007 consolidated cash change

RMB 385,858,872.11

Net cash from operating activities / 2006 / fy2007 consolidated operating cash comparative

RMB 323,289,457.08

Reported monetary-funds balance / 2007 / fy2007 consolidated cash equivalents closing

RMB 989,158,381.66

Advance payments rose from CNY 127.921 million at the start of FY2007 to CNY 653.175 million at year end. The financial note attributed the increase mainly to advances for Jushi Group project 216 and Chengdu project 220. It classified CNY 619.603 million, or 94.86% of the closing balance, as less than one year old. The five largest advance balances totaled CNY 220.842 million, or 33.81%, and were described as equipment or construction payments. These are amounts paid ahead of the supplier's performance, rather than customer receivables or evidence that the equipment was already installed. Project 220 is the code stated in this advance-payment note; the disclosure does not by itself establish a one-to-one link to one of the capacity plans. The project identity therefore remains bounded by the information actually reported.

Consolidated trade payables rose from CNY 304.024 million to CNY 1.349 billion during FY2007. The note attributed the increase mainly to platinum-rhodium alloy purchases. The largest named payable, to GERALD METALS, INC, was CNY 912.918 million for that alloy, representing a reported 67.69% of closing trade payables. The report says Jushi Group and Jushi Chengdu had issued one-year letters of credit for this obligation, with payment maturities between March and October 2008. This links the production-asset build-up to subsequent supplier payments. The disclosed payable is not an additional bank loan to add to the borrowing balances, and the maturity window does not establish that all payments were subsequently made. The supplier name and obligation are recorded as disclosed; this review does not extend into research on the supplier's own business.

Reported trade payables / 2007 / fy2007 consolidated trade payables closing

RMB 1,348,705,399.55

Reported trade payables / 2006 / fy2007 consolidated trade payables opening

RMB 304,023,856.8

Reported trade payables / 2007 / fy2007 gerald metals alloy payable closing

RMB 912,918,209.18

The fixed-asset note shows platinum-rhodium alloy increasing from CNY 1.314 billion to CNY 2.033 billion during FY2007. It reports CNY 793.101 million of additions and CNY 73.683 million of reductions. These are accounting movements in the alloy asset row, not cash purchase amounts or physical metal consumption. The accounting policy identifies platinum-rhodium bushings as important glass-fiber production equipment: the company periodically repairs them, charges actual maintenance losses to production cost, does not depreciate them, and compares their carrying value with recoverable value at the balance-sheet date. That policy explains why precious-metal production capital and the cost of using it have different accounting roles. It should not be generalized to every equipment item; the fixed-asset table separately reports depreciation for other machinery, buildings and vehicles.

Reported platinum-rhodium production assets / 2007 / fy2007 consolidated alloy asset closing

RMB 2,033,492,124.88

Reported platinum-rhodium production assets / 2006 / fy2007 consolidated alloy asset opening

RMB 1,314,074,183.33

At 31 December 2007, consolidated trade receivables were CNY 512.232 million before a CNY 21.233 million allowance, leaving CNY 490.999 million net. The opening figures were CNY 516.994 million gross, CNY 32.740 million allowance and CNY 484.254 million net. Gross balances therefore fell slightly while net balances rose; the difference cannot be explained simply as more sales or better collections. The allowance reconciliation includes CNY 3.429 million of additions and CNY 14.936 million of write-offs, comprising older Jushi balances and the allowance of a deregistered composites subsidiary. Writing off a balance is not receipt of customer cash. The five largest closing debtors owed CNY 173.220 million, a reported 33.82% of gross receivables, and their listed balances were within one year. They included Gibson, Jushi Panden, Poly Base, Future Composites Technology and Hengshi. That debtor concentration uses a balance-sheet denominator and differs from the 30.12% share of annual sales represented by the top five sales customers; the two lists and percentages should not be treated as identical.

Accounts receivable gross balance / 2007 / fy2007 consolidated trade receivables closing

RMB 512,231,771.97

Accounts receivable gross balance / 2006 / fy2007 consolidated trade receivables opening

RMB 516,994,312.54

Accounts receivable credit-loss allowance / 2007 / fy2007 consolidated trade receivables closing

RMB 21,232,991.03

Accounts receivable credit-loss allowance / 2006 / fy2007 consolidated trade receivables opening

RMB 32,740,391.12

Accounts receivable net carrying amount / 2007 / fy2007 consolidated trade receivables closing

RMB 490,998,780.94

Accounts receivable net carrying amount / 2006 / fy2007 consolidated trade receivables opening

RMB 484,253,921.42

Consolidated inventory net of its allowance fell from CNY 299.274 million to CNY 263.251 million in FY2007. Finished goods fell from CNY 130.990 million to CNY 84.131 million, while goods already dispatched but still recorded as inventory rose from CNY 30.801 million to CNY 47.981 million. Raw materials remained a substantial component at CNY 118.333 million, compared with CNY 123.332 million at the start of the year. These carrying values describe product stages and funds tied up in the operating cycle; dispatched inventory is not automatically recognized revenue or cash received. Separately, customer advances rose from CNY 72.751 million to CNY 172.107 million. The note attributes the increase to Jushi's sales and its policy of collecting from some customers before dispatch. Customer advances can fund the operating cycle but are liabilities tied to future performance, not an additional sale to add to revenue or a measure of the entire contracted order book. The closing inventory allowance was CNY 111,506, unchanged from the opening amount; the filing's allowance should not be interpreted as proof that every stock item was immediately saleable.

Inventory after allowance / 2007 / fy2007 consolidated inventory net closing

RMB 263,250,738.59

Inventory after allowance / 2006 / fy2007 consolidated inventory net opening

RMB 299,274,398.34

Gross finished goods / 2007 / fy2007 consolidated finished goods closing

RMB 84,130,843.82

Gross finished goods / 2006 / fy2007 consolidated finished goods opening

RMB 130,990,443.14

Goods dispatched remaining inventory / 2007 / fy2007 consolidated dispatched inventory closing

RMB 47,981,068.72

Goods dispatched remaining inventory / 2006 / fy2007 consolidated dispatched inventory opening

RMB 30,801,426.27

Reported raw material inventory / 2007 / fy2007 consolidated raw material inventory closing

RMB 118,332,513.29

Reported raw material inventory / 2006 / fy2007 consolidated raw material inventory opening

RMB 123,331,571.87

Customer advances in contract liabilities / 2007 / fy2007 consolidated customer advances closing

RMB 172,107,258.27

Customer advances in contract liabilities / 2006 / fy2007 consolidated customer advances opening

RMB 72,750,640.32

Management identified exchange-rate exposure, energy and raw-material inflation, borrowing associated with expansion and reduced export tax rebates as constraints on the business. It reported that the glass-fiber export rebate fell from 13% to 5% in the second half of 2007 and described a further cut to zero as a potential future risk, not an implemented policy in this filing. Natural gas, electricity and oxygen were named production inputs whose rising prices could reduce sales margins. Management's responses included changes to production processes and material formulations, some increased overseas procurement to offset currency exposure, greater domestic sales, and improvements in energy sourcing and logistics. It also warned that rapid industry capacity growth could pressure product prices. These are the issuer's risk assessment and proposed responses; the report does not quantify the portion of currency exposure hedged or the savings subsequently achieved by these plans.

The fifth extraordinary shareholders' meeting of 2007 approved a proposed share-swap absorption merger of Jushi Group into China Fiberglass. The issuer would survive and take over Jushi's employees, assets, liabilities, rights and business, while Jushi's separate legal entity would dissolve on completion. The issuer's existing 51% Jushi interest would be cancelled rather than exchanged. For the remaining 49%, the proposal valued the interest at CNY 3.181 billion and envisaged issuing 177.004 million A shares to Jushi's other holders at CNY 17.97 per share, with a 36-month transfer restriction after completion. The sellers included CNBM Company, Zhenshi, Zhencheng International and Surest Finance. These are transaction valuation and proposed share terms, not market-price guidance or shares already issued. Management expected CNBM Company and its ultimate group to retain control. The proposal also included conditional compensation if Jushi's net profit fell below the audited forecasts of CNY 452.867 million for 2007 or CNY 550.457 million for 2008, subject to the stated force-majeure exception. Cash or share compensation was a contractual protection described in the proposal, not a realized payment. Required regulatory approvals remained outstanding. Because Jushi was already consolidated, the proposed acquisition of minority interests would alter ownership and the allocation of earnings rather than simply add all of Jushi's existing operations as a newly consolidated business.

The issuer reported selling its 23% interest in China Composites to CNBM Company in April 2007 for CNY 103.06 million. It also described transferring a 20% interest in CNBM Investment, formerly Beixin Logistics, in December 2007. The management discussion presents CNY 104 million total consideration, including CNY 25.72 million of accumulated distributable profit, CNY 65.28 million for the equity and CNY 13 million for the period from the valuation date to the intended closing date. The financial note instead states an equity price of CNY 65.25 million under the 1 November agreement and an agreed CNY 13 million profit allocation for August through December. It says payment had not been received at year end and that shareholder-change registration was completed on 2 January 2008. The investment tables still show CNY 84.710 million for CNBM Investment at 31 December 2007, whereas the China Composites investment has no closing balance. The differing equity prices and transaction stages are retained explicitly. A management statement of sale, contractual closing date, cash receipt, registration and removal of an accounting balance are not interchangeable evidence of completion.

The management guarantee schedule reports CNY 671.798 million outstanding in the category excluding guarantees to subsidiaries and CNY 376.270 million outstanding to subsidiaries, summing to CNY 1.048 billion, or a reported 83.49% of the company's net assets. Its named rows in the first category give CNY 381 million for Jushi Jiujiang, CNY 627.250 million for Jushi Chengdu and CNY 325 million for Jushi Panden. Those rows sum to CNY 1.333 billion and cannot simply replace the reported closing aggregate. The filing does not bridge the named amounts to the outstanding balance. The categories also require care: Jiujiang and Chengdu appear among Jushi Group's controlled subsidiaries, whereas Panden is an equity-accounted joint venture. The financial notes include mutual guarantees within the manufacturing group, including Jiujiang's guarantee for a CNY 50 million Jushi Group loan outstanding at year end. Such a guarantee is security for an underlying borrowing, not additional consolidated cash raised. The disclosed obligations are relevant to creditor claims and shareholder exposure, but do not establish that every guarantee had been called or required a separate cash payment.

Outstanding guarantees outside subsidiaries / 2007 / fy2007 management excluding direct subsidiaries closing

RMB 671,797,500

Reported closing subsidiary guarantees / 2007 / fy2007 management direct subsidiaries closing

RMB 376,270,000

Outstanding subsidiary guarantees / 2007 / fy2007 management guarantee total closing

RMB 1,048,067,500

An earlier guarantee for Beijing Xiling adhesive and sealing materials had already required the issuer to repay a bank after the borrower defaulted. The other-receivable note gives that repayment as CNY 19.826 million, while the detailed dispute note gives CNY 19.926 million, a CNY 100,000 source difference. The report records CNY 5.329 million recovered during FY2007 and a CNY 14.597 million receivable outstanding at 31 December, with a CNY 1.172 million bad-debt provision. The larger repayment figure less the stated recovery exactly matches that receivable, but this reconciliation does not erase the lower printed figure. A separate CNY 20.065 million deposit paid to the court for asset preservation is not cash recovered from the defendants. The dispute remained in proceedings at year end; counsel's favorable assessment of recovery was an assessment reported by the company, not a final judgment or subsequent cash receipt. The issue shows how a past guarantee could tie up funds in both a recovery claim and a court deposit.

At the end of FY2007, CNBM Company held 36.15% of China Fiberglass and Zhenshi Group held 20.04%. The issuer identified CNBM Company as its controlling shareholder and China National Building Material Group as its ultimate controller, with no change in either during the year. The control diagram places Beixin Building Materials Group between the ultimate controller and CNBM Company and also shows a direct upstream interest; the issuer's direct controlling holder should not be confused with the ultimate group. On 17 August 2007, 59.041 million previously restricted shares became tradable under the earlier split-share reform, which changed trading restrictions on existing shares. The report states that total issuer shares did not change during FY2007. The release therefore was not a new share issue or a cash financing inflow. The source separately schedules further releases in 2008 and 2009; these are the historical schedule reported at that time, not evidence of subsequent sales by those holders.

Tianjian Huazheng Zhongzhou (Beijing) issued an unqualified audit opinion dated 3 March 2008 on China Fiberglass's FY2007 financial statements. The report covered the parent and consolidated balance sheets at 31 December 2007, income and cash-flow statements for the year, changes in shareholders' equity and the accompanying notes. The opinion states that the statements fairly presented the company's financial position, operating results and cash flows in all material respects under the Chinese Accounting Standards for Business Enterprises issued in February 2006. The audit report describes consideration of financial-reporting controls to design audit procedures, while explicitly saying that this financial audit was not an opinion on the effectiveness of those controls. It is assurance on the historical financial statements, not independent verification of all technology rankings, forecast commissioning dates or this site's English editorial work.

At the end of FY2007, consolidated short-term borrowings were CNY 2.222 billion, compared with CNY 1.632 billion at the start of the year. The note attributed the increase to funding for projects 216 and 217. Long-term loans totaled CNY 1.695 billion before classification by maturity: CNY 138.723 million was due within one year and CNY 1.556 billion remained in non-current long-term borrowings. The opening equivalents were CNY 200 million current and CNY 1.528 billion non-current. The current portion is part of the gross long-term loan total and must not be counted again on top of it. Loan security included third-party or group guarantees and mortgaged assets; the note also separately classified loans carrying both a mortgage and a guarantee. These are outstanding consolidated loan balances, not annual cash raised or remaining undrawn credit capacity.

Short-term borrowings / 2007 / fy2007 consolidated loans closing

RMB 2,221,800,952.89

Short-term borrowings / 2006 / fy2007 consolidated loans opening

RMB 1,632,000,000

Non-current long-term borrowings after current-portion deduction / 2007 / fy2007 consolidated loans closing

RMB 1,555,984,688

Non-current long-term borrowings after current-portion deduction / 2006 / fy2007 consolidated loans opening

RMB 1,528,479,750

Long-term loans due within one year / 2007 / fy2007 consolidated loans closing

RMB 138,723,000

Long-term loans due within one year / 2006 / fy2007 consolidated loans opening

RMB 200,000,000

The fixed-asset note reports new buildings of Jushi Group, Jushi Jiujiang and Jushi Chengdu with CNY 463.400 million original cost and CNY 441.151 million net carrying value for which property certificates were still being processed. It separately discusses older Beixin and Baoyu buildings without certificates and explains the Baoyu issue by reference to the absence of land-use certificates. These are disclosed documentation matters; the filing does not state that all affected production had stopped or that the buildings were unlawful. Elsewhere, production-related land and buildings were pledged to support borrowings. For example, Chengdu land with CNY 10.898 million net value secured a CNY 15 million loan outstanding at year end, due in November 2008. The asset carrying value, secured loan balance, maximum credit limit and documentation status describe different constraints on the manufacturing asset base; none is a measure of additional production capacity.

The original FY2007 borrowing-cost note reports CNY 196.433 million expensed and CNY 40.804 million capitalized, totaling CNY 237.238 million. The capitalized amount also appears among the year's construction additions, so it is part of recorded asset cost rather than a second capital expenditure to add on top of that construction total. Expensed interest rose from CNY 150.905 million in the comparative year. Net financial expenses were lower than gross interest, at CNY 159.042 million, after interest income of CNY 16.694 million and exchange gains of CNY 25.878 million, plus CNY 5.181 million of fees and other costs. The note attributes the rise in financial expenses to increased borrowing. Expensed cost, capitalized cost, net financial expense and cash interest payments have different accounting roles; these figures do not measure undrawn credit or the all-in cost of every loan. They retain the original FY2007 filing's presentation rather than substituting a later annual report's comparative column.

Consolidated finance-note interest expense / 2007 / fy2007 consolidated expensed interest

RMB 196,433,131.36

Capitalised interest in the year / 2007 / fy2007 consolidated capitalized borrow cost

RMB 40,804,430.81

Reported net finance expense / 2007 / fy2007 consolidated net finance expense

RMB 159,042,023

The original FY2007 filing reports CNY 308.620 million of profit attributable to the parent's ordinary shareholders and CNY 229.402 million after excluding its disclosed non-recurring items. The resulting CNY 79.219 million net contribution is a shareholder-profit measure after tax and minority-interest effects. It differs from the CNY 80.864 million pre-tax fair-value gain on trading financial assets in the consolidated income statement, and from the CNY 68.084 million profit impact presented in a narrower management table. The non-recurring schedule includes government grants of CNY 46.795 million, trading-asset holding and disposal income of CNY 8.754 million, asset-disposal losses and other adjustments, followed by CNY 29.476 million of tax effects and CNY 18.632 million of minority-interest effects. Summing the printed schedule components gives a net figure one cent above its printed total, which is preserved as a rounding or printing difference rather than corrected. Excluding these items helps separate manufacturing performance from the disclosed financial and other contributions; it does not establish future sustainable profit or cash generation.

Profit attributable to shareholders / 2007 / fy2007 consolidated nonrecurring schedule

RMB 308,620,323.26

Fair value income / 2007 / fy2007 consolidated nonrecurring schedule

RMB 80,863,910

Nonrecurring tax adjustment / 2007 / fy2007 consolidated nonrecurring schedule

RMB 29,476,443.79

Nonrecurring minority adjustment / 2007 / fy2007 consolidated nonrecurring schedule

RMB 18,631,881.15

Nonrecurring owner result / 2007 / fy2007 consolidated nonrecurring schedule

RMB 79,218,721.03

Profit excluding nonrecurring / 2007 / fy2007 consolidated nonrecurring schedule

RMB 229,401,602.23

Trading asset holding income / 2007 / fy2007 consolidated nonrecurring schedule

RMB 8,753,578.06

The issuer began applying the 2006 Chinese Accounting Standards on 1 January 2007. In its separate parent-company accounts, investments in consolidated subsidiaries changed from the equity method to the cost method, with retrospective adjustments. The parent retained-profit reconciliation moves from CNY 277.823 million before adjustment to negative CNY 79.570 million after a CNY 357.393 million reduction; this is a restatement of the opening balance, not a cash loss incurred during FY2007. The consolidated retained-profit reconciliation moves in the opposite direction, from CNY 177.405 million to CNY 254.220 million, because the two reporting perimeters differ. The parent then earned CNY 79.783 million in FY2007 and paid CNY 42.739 million for the previous year's distribution, leaving negative CNY 42.527 million available for distribution at year end. The board therefore proposed neither a FY2007 profit distribution nor a conversion of capital reserve into share capital. This is the proposal reported in this filing, not evidence of a later shareholder vote. Management expected a planned absorption merger of Jushi Group to change how its earnings entered the parent; the expectation does not establish that the merger had already occurred.

Reported parent retained earnings / 2006 / fy2007 parent opening restated

RMB -79,570,398.9

Reported retained earnings adjustment / 2006 / fy2007 parent opening restatement adjustment

RMB -357,393,243.92

Reported parent retained earnings / 2007 / fy2007 parent closing distribution schedule

RMB -42,527,009.37

The FY2007 tax note lists 15% income-tax rates for the issuer, Beixin Technology, Jushi Chengdu and several Beixin subsidiaries, 33% for Jushi Jiujiang and 14.94% for Jushi Group. It explains Jushi Group's actual 14.94% rate by reference to the then applicable foreign-invested-enterprise regime and local tax notices. These are legal-entity rates reported for this historical period; they are not one consolidated effective rate. The same page then states that the company's applicable rate would change from 33% to 25% on 1 January 2008. That general statement is not reconciled with the 15% issuer row, so it is retained as a source-scope difference rather than used to replace all entity rates. The note illustrates why the tax treatment of different manufacturing entities matters when reading profit, but does not establish their later or current tax status.

Reported historical corporate-income-tax rate by entity / 2007 / fy2007 historical tax issuer

15 percent

Reported historical corporate-income-tax rate by entity / 2007 / fy2007 historical tax jushi group

14.94 percent

Reported historical corporate-income-tax rate by entity / 2007 / fy2007 historical tax jushi jiujiang

33 percent

The consolidated investment-income note totals CNY 9.919 million for FY2007. It includes negative CNY 139,064 of equity-method results, CNY 1.939 million of long-term equity disposal gains, CNY 8.754 million from holding or disposing of trading financial assets and negative CNY 634,460 of other investment results. The equity-method subtotal includes CNY 14.864 million for CNBM Investment, offset by losses of CNY 10.785 million for the Jushi Panden electronic-substrate joint venture and CNY 4.118 million for Nanjing Huafu property development, plus smaller contributions. Panden's investment was reported at CNY 103.608 million at year end after its loss contribution, and the joint-venture holding was 50%. The CNY 10.785 million is the investor's recorded equity-method contribution, not Panden's full-company loss or the trade receivable owed by Panden. A following table prints CNY 1.166 million as a total excluding the CNY 8.754 million trading-asset contribution; the two totals reconcile when that contribution is added. These realized or equity-accounted results also differ from the separate CNY 80.864 million fair-value gain. Keeping those perimeters distinct prevents securities returns, investee losses and subsidiary manufacturing profit from being treated as the same earnings source.

Consolidated investment income or loss / 2007 / fy2007 consolidated investment income all

RMB 9,919,151.01

Consolidated equity-method investment income / 2007 / fy2007 consolidated equity method income total

RMB -139,063.89

Consolidated equity-method investment income / 2007 / fy2007 panden equity method loss contribution

RMB -10,784,915.52

Consolidated equity-method investment income / 2007 / fy2007 huafu equity method loss contribution

RMB -4,118,309.7

The FY2007 management report describes a January increase of USD 41.05 million in Jushi Group's registered capital. China Fiberglass, CNBM Company and Zhencheng International subscribed, with a price of USD 2.67 for each dollar of registered capital; Jushi Group reportedly received USD 109.60 million including equivalent renminbi. A simultaneous transfer of another shareholder's interest to Zhencheng was separate from that capital subscription. After these transactions, the disclosed ownership was 51% for China Fiberglass, 11.5% for CNBM Company, 11% for Zhenshi, 8% for Surest Finance and 18.5% for Zhencheng. The related-party interest table gives the issuer's opening share as 59.90% and closing share as 51%, so retaining control did not mean retaining the same share of subsidiary earnings. The full-year capital table separately reports registered capital rising from USD 110.1516 million to USD 186.20810545 million, a larger movement than the January transaction alone. The subsidiary table presents USD 94.9661 million as the issuer's year-end actual investment, while the related-interest table presents USD 77.1161 million as its closing interest amount. The filing does not reconcile these two amounts; neither is substituted for the other or treated as annual cash contributed.

China Fiberglass held 51% of Jushi Group at the end of FY2007, with an equal voting share. Jushi Group in turn held 100% of Jushi Jiujiang and 57% of Jushi Chengdu. The Chengdu subsidiary's disclosed business covered glass fiber, composite materials, related equipment and raw materials, as well as import and export activities. These are different ownership layers: Jushi Group's percentage in a subsidiary is not the listed issuer's direct percentage in that subsidiary, and a registered business scope does not quantify actual output. Outside the glass-fiber chain, the issuer held 95% of Beixin Technology. Beixin's subsidiaries included household building-material trading and market operations and Jun'an Cement Products, which made cement-sand blocks, pipe sections and utility poles. Beixin purchased the other 50% of Jun'an in September 2007 for CNY 9 million, taking its holding from 50% to 100%. The Lvxing home-building-material market operation was being liquidated using 30 September as its reference date, with deregistration still in progress at the report date. These businesses help define the original group's scope; they should not be described as additional glass-fiber production lines.

The subsidiary note describes Jushi Hong Kong as a glass-fiber sales and specialist-equipment trading company, wholly owned by Jushi Group. Its registered capital was USD 360,000, but the footnote gives actual capital paid by year end as USD 192,000. Jushi Korea was 60% owned, with USD 500,000 registered capital and USD 300,000 of Jushi's actual contribution; its stated business was glass-fiber sales and trade in equipment and chemical raw materials. The 60%-owned South African Huaxia composites company had USD 4 million registered capital and USD 2.4 million actual Jushi contribution, with production and sales of glass fiber and related products in its business scope. This supports a distinction between sales channels, trading operations and a disclosed manufacturing scope, but the note provides no operating capacity or commissioning date for the South African company. Jushi Europe and the Jiaxing glass-fiber composites subsidiary were deregistered during FY2007 and excluded from consolidation. Their appearance in the historical subsidiary table does not mean they remained active consolidated businesses at year end.

Management's FY2007 subsidiary profile reports CNY 598.808 million net profit and CNY 7.790 billion total assets for the 51%-owned Jushi Group, whose stated main business was manufacturing and selling glass fiber and composite materials. For the 95%-owned Beixin Technology, it reports a CNY 20.509 million net loss and CNY 235.191 million total assets, with activities including new materials, general distribution and investments. These profiles show why the glass-fiber business and the smaller building-material businesses had different earnings roles during the year. The subsidiary net profit amounts are the reported profits of those businesses, not the listed issuer's attributable share or separate incremental profits to add to consolidated net profit. Likewise, their asset totals cannot simply be summed with or subtracted from group assets without considering consolidation and intercompany eliminations. The source profile does not break every subsidiary's profit into products or production sites.

Reported subsidiary net profit / 2007 / fy2007 subsidiary jushi group management net profit

RMB 598,807,800

Reported subsidiary assets / 2007 / fy2007 subsidiary jushi group management assets

RMB 7,789,617,400

Reported subsidiary net profit / 2007 / fy2007 subsidiary beixin technology management net profit

RMB -20,508,700

Reported subsidiary assets / 2007 / fy2007 subsidiary beixin technology management assets

RMB 235,191,300