Transcription

1 OO

2

3 2004 1

4 Shanghai Zhenhua Port Machinery Co.,Ltd. ZPMC [email protected] [email protected] AB A A B B B

5 2004 : : 466,058, ,907, ,539, ,229,294 12,464, ,905,045 1,500, , ,272,177 1,234,276,179 : : 456, ,693 2,128,729 3,465,997-29, , , ,693 2,128,729 3,436,515 : : ,240, , ,138, ,687 6,368,313 3

6 2004 : : (% 7,109,664,330 4,628,172,800 4,628,172, ,074,237,616 3,074,237, ,058, ,976, ,976, ,364, ,364, ,907, ,692, ,692, ,004, ,004, ,539, ,079, ,079, ,473, ,473, (% 11,955,452,259 7,281,864,087 7,271,169, ,436,505,632 5,205,288,896 3,465,996,854 2,128,729,091 2,128,729, ,942,336,344 1,851,036, ,272, ,823, ,823, ,315, ,315, (% % % % % (% A

7 : : % : : 456,500,000 1,116,492, ,067,821 96,398, ,668,309 2,128,729, ,780, ,079, ,712,631 45,801, ,907,889 2,187,480, ,600, ,612, ,212,693 1,027,280,000 1,699,972, ,780, ,200, ,963,567 3,465,996, ,500, ,500, ,500, ,500,000 ( ( ( ,280, ,903, ,280, ,623,026 (

8 : 1 258,500, ,400, ,100, ,000, ,556,000 64,222,400 96,333, ,112,000 97,944,000 39,177,600 58,766, ,888, ,500, ,400, ,100, ,000, ,000,000 35,200,000 52,800, ,280, ,280, ,000,000 44,000,000 66,000, ,000, ,000,000 79,200, ,800, ,280, ,280, ,500, ,600, ,900, ,280,000 1,027,280, ,614,673 17,478,708 3 (1 : : A ,280, ,186,619 A ,280, ,392,300 A ,280, ,701,081 ( ,500,

9 ,500, ,500, ,500,000 ( ( ( ,280, ,903, ,280, ,623,026 ( (3 1 48,395 3 A 32,934 B 15,458 2 : ( (% 160,556, ,112, ,112, ,225, TOYO SECURITIES ASIA LTD. A/CCLIENT 15,199,443 18,503, ,785,794 11,785, HKSBCSB S/A-BANQUE INT.A LUXEM BOURG S/A HSBC GLOBAL INV. FUNDS CHINESE EQUITY NIKKOCITI TRUST AND BANKING CO RPORATION S/A RE: JF CHINA MOTHER FUND SCBHK A/C BONY S/A MATTHEWS INTL FUNDS - MATTHEWS DRAGON CENTURY CHINA FUND 5,268,078 10,536, ,205,000 9,205, ,587,183 8,729, ,842,242 7,842, ,100,000 7,100, NAITO SECURITIES CO., LTD. 5,123,208 6,835,

10 ( A 114,280,000 A 34,186, ,093,381 13,392,300 66,701, ,352, ,178, , ( 234, ,112, %

11 , C 192,225, % ABH TOYO SECURITIES ASIA LTD. A/CCLIENT 18,503,713 B 11,785,794 A HKSBCSB S/A-BANQUE INT.A LUXEM BOURG S/A HSBC GLOBAL INV. FUNDS CHINESE EQUITY 10,536,156 B NIKKOCITI TRUST AND BANKING CO RPORATION S/A RE: JF CHINA MOTHER FUND 9,205,000 B SCBHK A/C BONY S/A MATTHEWS INTL FUNDS - MATTHEWS DRAGON CENTURY CHINA FUND 8,729,682 B 7,842,242 A 7,100,000 A NAITO SECURITIES CO., LTD. 6,835,355 B JPMCB / FF GREATER CHINA FUND 6,550,000 B 6,167,601 A ( 9

12 : ( ( ( (4 MBA (

13 2004 (6 MBA (7 MBA 2001 ( ( MBA WTO ( ( (12 (13 ( (15 MBA

14 2004 (16 MBA 2003 ( ( (19 MBA, ( ( ( : : 2,619, , , /

15 ( (1 (2 ( ,

16 2004, 14

17

18

19 , 55, , %, A 31, A 8.18%B 21, B % A A A 8 A 9 A 10 A 11 A

20

21 (1 710, % 24% 46, , (2 : : (% (% 6,496,970, ,787, ,694, ,933, : ,109,664,330 / 872,721,243 / 0 / / 7,109,664, ,721, (3 : : (% (% ( 1,835,683, ,551, ,697,364, ,347, ( 1,675,798, ,566, ,379,520, ,751,

22 ,086, ,621, ,014, ,855, , ,453 0 : ,109,664,330 / 872,721,243 / 0 / / 7,109,664, ,721, ( (4 50 (5 10% : : (% 6,496,970,073 5,655,182, (1 : : 5,000,000 93,303, , ,000,000 29,796, , ,000,000 6,013, , ,000,000 1,000,000 1,000,000 1,000,000 1,000,000 10,000 1,533,547, ,636 ZPMC(MSDN.BHD : : 245,097 38% 224,128 32% 4 20

23 ,690 82, : : 19,474 20,988 19,069 13,321 19,975 14, ,869 2,458 19,980 20,360 2,980 2,378 2,980 21

24 ,960 1,304 6,403 6,403 96,690 82,180 / / , ,699 : : 11,955,452,259 7,281,864,087 4,673,588, ,229, ,513, ,715, ,907, ,692, ,215, ,234,276, ,558,146 1,035,718, ,465,996,854 2,128,729,091 1,337,267, ,331,157,960 2,152,615,748 2,178,542, ,205,325 97,162,593 95,042, ,418, ,397, ,021, ( (2 ( A (4 (A 22

25 2004 (5 (6 ( A 2004 A A A A A

26 ,000,000 A A [2004] ,280,000 A ,950, ,903, ,907, ,019, ,425, ,536, ,019, ,801, ,801, ,108, ,198,258 2,768, ,963,567 24

27 , ,273,600 38,689, ( ( ( [2003] ( : ( 8,713,932 44,808, ,137,

28 ,137,

29 A % 27

30 ( ZP ,379, ,110, ZP ,618, ,690, ZP ,203, ZP ,044, ,515,

31 ZP ,563, ,281, ZP ,913, , ZP ,430, ,715, ZP ,654, : : ( 236,137,103 2 : : ( 8,713, ,137,103 29

32 % 2 8,713, , ,247,272, ,000, ,808,006 1,772, , , AP MOLLER ( , ,207 10,800 9, ,000 58,

33 2004 6,500 54, % 5% ,000 12,000 3,000 31

34 , ,051,

35

36

37

38 ( ( ( ( (

39 (, (1 1,527,021, ,252,722 1,466,876, ,030,975 3,000,000-3,000,000 - (2, (1 2,733,627,726 1,953,822,331 2,784,620,764 2,026,665,402 (3, (2 49,872,258 96,874, ,566, ,324,707 (4 392,678, ,228, ,336, ,090,790 (5 4,331,157,960 2,152,615,748 4,280,314,325 2,131,771,806 9,037,357,543 4,616,793,832 9,054,714,463 4,671,883,680 6, ( (3 82,620,337 82,271,915 95,200,824 94,885,527 3,245,485,411 2,313,098,147 3,220,759,752 2,288,372,488 (707,337,786 (529,534,602 (699,506,059 (522,789,857 7 ( 2,538,147,625 1,783,563,545 2,521,253,693 1,765,582,631 8 ( 54,014, ,110,930 54,014, ,110,930 2,592,161,847 2,205,674,475 2,575,267,915 2,187,693,561 9 ( 35,007,234 37,655,817 13,713,077 15,409,047 0 (1 178,174, ,773, ,343, ,578, ,182, ,429, ,056, ,987,893 1 (1 30,130,447 10,694,412 30,130,447 10,694,412 11,955,452,259 7,281,864,087 11,919,370,244 7,263,145,

40 ( (, (1 2,996,775,000 1,655,526,870 2,996,775,000 1,655,526,870 (13-599,237, ,237,553 (14 576,575, ,190, ,275, ,515,374 (14 2,353,796, ,564,219 2,336,010, ,424, , ,731,737 14,871,541 4,808,822 13,433,189 /( ( (16 15,479,405 (258,093,469 14,940,887 (257,158,811 (14 367,154,803 25,739, ,239,361 32,889,641 (17 179,073, ,746, ,229, ,746,791 (19 905,817, ,531, ,817, ,531,660 8 (1 85,650,515 18,520,354 85,650,515 18,520,354 7,488,372,918 4,288,835,348 7,449,747,924 4,268,667, ( 999,637, ,871, ,637, ,871,860 8,488,009,918 5,151,707,208 8,449,384,924 5,131,539,062 1,445,487 1,427, (2 1,027,280, ,500,000 1,027,280, ,500,000 2 (2 1,699,972,835 1,116,492,961 1,699,972,835 1,116,492,961 3 (2 576,780, ,067, ,780, ,067, ,200,892 96,398, ,200,892 96,398,949 (24 161,963, ,668, ,952, ,545,229 3,465,996,854 2,128,729,091 3,469,985,320 2,131,606,011 11,955,452,259 7,281,864,087 11,919,370,244 7,263,145,

41 2004 (, (25, (4 7,109,664,330 4,628,172,800 7,099,927,106 4,628,172,800 25, ( 5 ( (6,236,943,087 (4,117,785,022 (6,254,609,529 (4,133,457,104 (491,949 (2,873,860 (331,815 (2,786, ,229, ,513, ,985, ,928,861 (26 12,464,803 10,392,992 12,464,803 10,377,205 (17,165,430 (13,407,845 (17,165,430 (13,407,845 (192,205,325 (97,162,593 (165,321,453 (78,724,759 - (27 (211,418,297 (105,397,292 (208,507,110 (105,229, ,905, ,939, ,456, ,943,520 (28, ( 6 1,500,391 10,759,748 1,467,266 10,729,828 4,665, ,637 2,910, ,581 (4,011,820 (3,719,519 (3,743,503 (3,421, ,058, ,976, ,091, ,770,030 (29 (9,133,216 (32,271,459 (9,071,597 (32,200,363 (17,699 (11, ,907, ,692, ,019, ,569, ( (

42 2004 (, ,907, ,692, ,019, ,569, ,668, ,446, ,545, ,446, ,576, ,139, ,564, ,016,130 (45,801,943 (28,056,967 (45,801,943 (28,056,967 (45,801,943 (28,056,967 (45,801,943 (28,056,967 (206,108,745 (28,056,967 (206,108,745 (28,056, ,863, ,968, ,852, ,845,229 (182,600,000 - (182,600,000 - (91,300,000 (91,300,000 (91,300,000 (91,300, ,963, ,668, ,952, ,545,

43 2004 (, 8,431,302,437 8,328,581, ,443, ,443, ,323, ,168,924 9,405,069,140 9,300,194,493 (8,893,474,514 (8,844,490,248 (224,978,377 (193,830,542 (50,771,152 (40,223,590 (86,572,920 (77,203,135 (9,255,796,963 (9,155,747, ,272, ,446,978 1,151,969 1,151, , ,530 3,201,451 3,103,634 4,932,950 4,835,133 (513,726,315 (513,726,315 (9,492,427 (9,492,427 (523,218,742 (523,218,742 (518,285,792 (518,383, ,659, ,659,874 4,715,450,530 4,715,450, ,133, ,133,113 6,418,243,517 6,418,243,517 (4,581,522,286 (4,581,522,286 (233,431,437 (233,431,437 (4,814,953,723 (4,814,953,723 1,603,289,794 1,603,289, ,234,276,179 1,229,353,

44 2004 ( (, ,907, ,019,435 17,699-31,958,497 31,958, ,803, ,716,202 2,648,583 1,695,970 52,628,006 57,784,528 (579,530 (579, ,433, ,530,931 (1,500,391 (1,467,266 (19,436,035 (19,436,035 (2,175,419,195 (2,145,419,502 (620,285,992 (636,043,230 2,116,096,348 2,092,686, ,272, ,446, ,517,528,901 1,457,384,138 (283,252,722 (228,030,975 1,234,276,179 1,229,353,

45 ,814,343 19,814,343 39,220,146 39,220,146-4,138,632-4,138,632 54,895,857 54,895,857 18,035,996 18,035,996 29,262,068 29,262,068 (4,138,632 (4,138,632 43,159,432 43,159,432 1,778,347 1,778,347 9,958,078 9,958, ,736,425 11,736, ,804,029 22,804,029 4,704,843 4,704,843 (7,827,860 (7,827,860 19,681,012 19,681,012 7,827,860 7,827,860 3,848,387 3,848,387 (7,827,860 (7,827,860 3,848,387 3,848,387 14,976,169 14,976, , , ,832,625 15,832,

46 2004 ( ( ( ( ( ,280,000 (A (1 ( (3 (4-8 -

47 2004 ( ( (5 (6 (7 (1 (2-9 -

48 2004 ( ( (8 (9 (

49 2004 ( ( (10 ( 0% - 30% 0% - 100% 50% - 100% 100% (

50 2004 ( ( (12 20%20% 20% 20% 20%20% 10 (

51 2004 ( ( (13 ( % 4.5% % 10% 5 10% 18% 5 10% 18% 5 10% 18% / 2% 9%

52 2004 ( ( (14 (

53 2004 ( ( (16 (17 (18 (

54 2004 ( ( (20 (21 ( % 10%

55 2004 ( (i 17% 17% 17% (ii 3% (iii (1 15% 70% 10% % 10% ( % (2 ( ( % ( % (3 33% ( % (4 ( 17.5% ( %

56 2004 ( 5,000,000 4,500,000 90% - 5,500,000 4,950,000 90% - 5,000,000 3,500,000 70% - 1,000, ,000 90% 9% 1,000, ,000 90% - 1,000, ,000 90% - ( 10, % - ZPMC(MSDN.BHD. 100, % ZPMC (M SDN. BHD. 10%

57 2004 ( ,323 98,158 1,514,424, ,975,633 12,449,677 20,178,931 1,527,021, ,252, ,971, ,272, , ,237, , ,544,279 7, ,074 1, , ,094, ,527,021,328 (9,492, ,517,528, (283,252,722 1,234,276,

58 2004 (

59 2004 ( ( ,776,787,158 1,971,858,327 (43,159,432 (18,035,996 2,733,627,726 1,953,822,331 (a % % 2,364,696, ,827,408, ,233, ,255, ,028,350 1 (14,924,286 50,541,623 3 (14,383,143 27,176,236 1 (24,582, ,652,765 - (3,652,765 3,652,853 - (3,652,853 2,776,787, (43,159,432 1,971,858, (18,035,

60 2004 ( ( 2 ( (a ( (1 APPA 3,652,765 (2 22,455,719 10,244,511 12,211,208 PECEM 2,126,662 (3 29,498,654 14,924,

61 2004 ( ( 2 ( (a ( (4 256,139,520 ( RTT 16,387,866 4,138,632 10,442,028 (b (c 5%(5% 1,101,541,070 40%

62 2004 ( ( ,608,683 98,652,737 (11,736,425 (1,778,347 49,872,258 96,874,390 (a % % 46,831, ,335, ,155, ,664, (1,778,347 11,977, (11,736,425 1,001, , , ,608, (11,736,425 98,652, (1,778,347 11,736,425 ( ,158, ( ,158,

63 2004 ( ( 3 ( (a ( 7,874, ,000,715 9,875,596 12,546,813 1,778,347 9,958,078 (b (c 5%(5% 47,621,160 77% ,678, ,228,641 (a (b 5%(5%

64 2004 ( ( ,702, ,229,948 3,477,136,396 1,692,189,829 4,350,838,972 2,175,419,777 : (19,681,012 (22,804,029 4,331,157,960 2,152,615, ,976, ,456-15,832,625 7,827,860 3,848,387 (7,827,860 3,848,387 22,804,029 4,704,843 (7,827,860 19,681,

65 2004 ( ( (1 6,377, , ,566,375 (2 67,973,745-1,871,048 - (1,711,320 68,133,473 (3 7,920, ,920,489 82,271,915-2,059,742 - (1,711,320 82,620,

66 2004 ( ( 6 ( ( ( % 3,500, ,278 3,602, ,694 3,791, % 1,000,000-1,000, ,000, % 900, , , % 900, , ,000 ZPMC (M SDN. BHD % 4 (24,907 (24, (24,903 6,300, ,371 6,377, ,694 6,566,375 (

67 2004 ( ( 6 ( ( ( % 67,040,000 1,093,473 67,973,745 1,871,048 (1,711,320 68,133, ,113, ,979,303 (1,711,320 (6,845,280 10,267,

68 2004 ( ( 6 ( ( ,120, % ,000 10% ,000 10% ,000,000 10% 7,920,

69 2004 ( ( ,279,527, ,117,507 59,371, ,154,958 10,926,984 2,313,098, ,891, ,789,775 2,858,700 27,585,064 6,703, ,827,913 11,096, ,452,343 4,076,064 49,770,937 1,163, ,559, ,860,514,995 1,012,359,625 66,305, ,510,959 18,793,883 3,245,485, ,312, ,587,178 27,970, ,857,446 5,807, ,534,602 59,354,875 74,462,503 7,475,877 35,277,357 1,232, ,803, ,667, ,049,681 35,445, ,134,803 7,040, ,337, ,628,847, ,309,944 30,859, ,376,156 11,753,648 2,538,147, ,107,215, ,530,329 31,401, ,297,512 5,119,321 1,783,563,

70 2004 ( ( ,000,000 42,303,887 53,071,784 (95,375, ,000, ,495,178 57,800,621 (371,295, ,000,000 35,970, ,916,932 (166,008,371 53,879,222 49% 40,000,000 18,653,935 1,566,438 (20,220,373-17,000,000 6,854,140 4,595,308 (11,449,448-15,700,000 2,955,761 11,513,330 (14,334, ,000 91% 19,000,000 1,877,368 16,986,864 (18,864,232-3,500,000-2,546,701 (2,546,701-7,000,000-7,055,725 (7,055, ,500,000-2,572,981 (2,572, ,800,000-5,843,213 (5,843, ,774,200-13,782,064 (13,782, ,400,000-3,479,244 (3,479, ,110, ,731,205 (732,827,913 54,014,222 17,531,865 16,195,365 (33,727, %( % -32-

71 2004 ( ( / 50,224,331 (16,434,256 35,326,219 - (1,536,144 33,790, ,621,805 (3,621, ,663 - (205, ,310,344 (6,267,245 1,706,305 - (663,206 1,043, ,264,850 (1,090, ,630 - (243, , ,421,330 (27,414,096 37,655,817 - (2,648,583 35,007,

72 2004 ( ( ,174, ,773, ,662,681 ( ,071, ,130,447 10,694,

73 2004 ( ( ( ((6(d - 41,383,500 2,996,775,000 1,614,143,370 2,996,775,000 1,655,526, ,000,000 ( ,100, %4.70% ( %5.31% ,237, %4.08% ( %3.52% 10,409,205 ( ,679,

74 2004 ( ( 14 (1 5%(5% (2 5%(5% ( ,023,369 - ( ((6(e 44,808,006 6,499,406 9,058,899 3,759,331 3,515,722 2,141,148 1,834,920 1,359,923 ( ((6(e 1,772,762 2,168,083 8,141,125 9,811, ,154,803 25,739,

75 2004 ( 5%(5% -37-

76 2004 ( ( ( - 32,111,200 (32,111, ,222,500 (19,222, ,300 (366,300 - B - 22,000,000 (22,000,000 - A - 17,600,000 (17,600, ,300,000 (91,300, /( (43,674,165 (285,620,349 57,395,183 26,297,491 1,758,387 1,229,389 15,479,405 (258,093, ,052, ,203,653 21,000,000 6,000,000 18,171,941 10,543,138 1,849, ,073, ,746,

77 2004 ( ( ( 27 85,650,515 18,520, ,000,000 (EUR/USD ,000,000 (EUR/USD ,000,000 (EUR/USD ,000,000 (EUR/USD ,000,000 (EUR/USD ,500,000 (USD/RMB ,500,000 (USD/RMB ,000,000 (EUR/USD ,000,000 (EUR/USD ,000,000 (EUR/USD ,000,000 (EUR/USD ,000,000 (EUR/USD ( ((6(d 505,000,000 35,000, ,000, ,000, ,817, ,531, ,817, ,531, %6.03%( %6.03% 160,000,000 ( ,000, ,000,000 28,200,000 (2003 9,800,

78 2004 ( ( ,637, ,871, RMB 36,000, % RMB 138,600, % USD 82,765, LIBOR+0.8% RMB 20,000, % RMB 30,000, % RMB 45,000, % RMB 250,000, % USD 397,272, % 999,637, ,272,000 ( ,000,000 ( ((6(d -40-

79 2004 ( ( ,556, ,556, ,112,000-97,944,000 97,944, ,888, ,500, ,500, ,000,000-88,000,000 88,000, ,280, ,280, ,000, ,000, ,000, ,500, ,500, ,280,000 1,027,280, ,500, ,500, ,500,000 ( ( ,280, ,903, ,280, ,280, ,623,026 (

80 2004 ( ( ,130, ,623,026 (273,900,000 1,570,853,966-40,910,290 - (4,700,062 36,210,228-83,451,731 4,700,062-88,151, ,756,848-4,756,848 1,116,492, ,079,936 (278,600,062 1,699,972, ,280, ,027,280, ,640, ,398,949 96,398,949 86,269, ,067,821 45,801,943 45,801, ,108, ,712, ,200, ,200, ,378, ,780,452 (1 10% 50% (2 5%10% ( % -42-

81 2004 ( ( ,668, ,446, ,907, ,692,747 ( (23 (45,801,943 (28,056,967 ( (23 (45,801,943 (28,056,967 ( (23 (206,108,745 (28,056,967 (182,600, (91,300,000 (91,300, ,963, ,668, ,027,280, ,273, (a ,496,970,073 4,415,132, ,694, ,628,906-81,800,658-5,610,683 7,109,664,330 4,628,172, ,655,182,192 3,952,670, ,760, ,535,140-42,835,616-3,744,022 6,236,943,087 4,117,785,

82 2004 ( ( 25 ( (b ( (i 1,835,683,501 1,633,131,866 1,911,139,125 1,687,797,764 1,697,364,596 1,472,016, ,629, ,268,610 ( 1,675,798,551 1,504,232, ,735, ,863,175 1,379,520,690 1,172,769, ,359, ,494, ,086, ,465, ,004, ,163,190 19,014,216 15,158, , , , ,632 43,384 28,191 7,109,664,330 6,236,943,087 4,628,172,800 4,117,785,022 (i (c 2,241,276,186 32% -44-

83 2004 ( ( ,148,584 5,784,161 4,815,468 3,724,514 1,500, ,317 12,464,803 10,392, ,634, ,517,833 (10,742,978 (26,255,815 52,642,082 54,445,483 (53,231,706 (48,657,510 ( 18 85,650,515 18,520,354 5,465,819 1,826, ,418, ,397,

84 2004 ( ( ( 6 2,059,742 11,232,070 (1 1,151,969 1,238,998 ( 6 (1,711,320 (1,711,320 1,500,391 10,759,748 1 ( ,000,000 4, ,000 47, ,878,200 42,965,871 (34,308,949 - ( 11 (19,436,035 (10,694,412 9,133,216 32,271,459 ( ,308,

85 2004 ( (

86 2004 ( ,827,780,196 2,044,701,398 (43,159,432 (18,035,996 2,784,620,764 2,026,665,402 (a % % 2,377,534, ,900,251, ,918, ,255, ,498,654 1 (14,924,286 50,541,623 2(14,383,143 27,176,236 1 (24,582, ,652,765 - (3,652,765 3,652,853 - (3,652,853 2,827,780, (43,159,432 2,044,701, (18,035,

87 2004 ( ( 1 ( (a ( (1 APPA 3,652,765 (2 22,455,719 10,244,511 12,211,208 PECEM 2,126,662 (3 29,498,654 14,924,

88 2004 ( ( 1 ( (a ( (4 295,832,670 ( RTT 16,387,866 4,138,632 10,442,028 (b (c 5%(5% 1,539,507,375 54% -50-

89 2004 ( ( ,302, ,103,054 (11,736,425 (1,778, ,566, ,324,707 (a % % 124,710, ,017, ,155, ,432, (1,778,347 11,977,213 9 (11,736,425 1,001, , , ,302, (11,736, ,103, (1,778,347 (b (c 5%(5% 120,701,181 87% -51-

90 2004 ( ( (1 18,991, , ,146,862 (2 67,973,745-1,871,048 - (1,711,320 68,133,473 (3 7,920, ,920,489 94,885,527-2,026,617 - (1,711,320 95,200,

91 2004 ( ( 3 ( ( ( 11 ( % 4,500,000 3,396,885 7,802,100-94,785 7,896, % 4,950, ,502 5,047,997-64,505 5,112, % 3,500, ,278 3,602, ,694 3,791, % 900, , , % 900, , , % 900, , ,000 ( % - (328,900 (136,485 - (192,415 (328,900 ZPMC (M SDN. BHD % 4 (24,907 (24, (24,903 15,650,004 3,496,858 18,991, ,569 19,146,

92 2004 ( ( 3 ( ( ( % 67,040,000 1,093,473 67,973,745 1,871,048 (1,711,320 68,133, ,113, (1,711,320 (6,845,280 10,267,

93 2004 ( ( 3 ( ( ,120, % ,000 10% ,000 10% ,000,000 10% 7,920,

94 2004 ( ( ,493,825,003 4,415,132, ,102, ,628,906-81,800,658-5,610,683 7,099,927,106 4,628,172, ,674,273,059 3,967,718, ,336, ,989,447-43,000,517-3,748,354 6,254,609,529 4,133,457, ( 3 2,026,617 11,202,150 (1 1,151,969 1,238,998 ( 3 (1,711,320 (1,711,320 1,467,266 10,729,828 1 ( ( ,000,000 4, ,000 47,

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96 2004 ( ( ( ,345,490, ,345,490,000 ( 5,000, ,000,000 5,500, ,500,000 5,000, ,000,000 1,000, ,000,000 1,000, ,000,000 1,000, ,000,000 ( 10, ,000 ZPMC(MSDN. BHD. 100, ,

97 2004 ( ( ( % % % % 160,556, ,556, ,112, ( ( ( 50.33% ( % % % % 4,500,000 90% ,500,000 90% 4,950,000 90% ,950,000 90% 3,500,000 70% ,500,000 70% 900,000 90% ,000 90% 900,000 90% ,000 90% 900,000 90% ,000 90% 10, % , % ( ZPMC (M SDN.BHD. 100, % , % -59-

98 2004 ( ( ( % 0.36% (6 (a ,137, ,423,480 (b ,713,932 6,669,

99 2004 ( ( (6 ( (c ,789,318 ( 273, , ,975 4,232,943 (d ( - 505,000, ,272,000 (e ,808,006 6,499,406 1,772,762 2,168,083 46,580,768 8,667,

100 2004 ( ( (6 ( (f ( ,000, (1 943,941, ,690, ( ,943,808 45,331, (3 233,613, ,472,

101 2004 ( ,037,667 8,316,000 11,562,613 8,549,280 11,416,222 8,276, ,030, ,181, ,047, ,322, ,240, ,540, ,315,115 ( ,067,

102 2004 ( ,000, ,051,700 55% ( 1 51,000,000 51% ( 49,000,000 49% (1 West Basin United Terminal Leasing LLC 2,664,300 5,448,390 ( (

103 2004 ( ( ,908 3,465,997 (29,482 (29, ,426 3,436,

104 2004

105 2004 ( (1 (% (/ 872, % 37.89% , % 20.15% , % 19.85% , % 19.57% ( ,814 19,814 39,220 39,220 (4,139 (4,139 54,895 54,895 18,036 18,036 29,262 29,262 (4,139 (4,139 43,159 43,159 1,778 1,778 9,958 9, ,736 11, ,804 22,804 4,705 4,705 (7,828 (7,828 19,681 19,681 7,828 7,828 3,848 3,848 (7,828 (7,828 3,848 3,848 14,976 14, ,833 15,

106 2004 ( 30%(30% 5%(5% 10%(10% (1 439% (A (2 40% (3 101% (4 40% (5 81% (6 197% (7 125% (A (8 52% (A (9 54% (10 51% (11 98% (12 101%

107 : :L: AWZ : : ( 2004 A 1.CALLOVER Initials Sentto 1st 2nd Final Calledoverby to to to Additionscheckedby Crossreferencedby Cross-checktoEnglishversionby Proofreadby(Manager 2.REVIEWEDANDAPPROVEDFORPRINTINGBY Manager Partner 3.TOPRINTINGROOM Accounts Letterhead Auditorscopy PWDH Taxcopy PWASIA AGMcopy Other Additional TechDeptcopy Total No.of pages TypeofBinding Staple Plastic Requiredby Date Time *****This page is generated by the word processing***** centre and is not part of the report

108 2004

109

110 ( ( ( ( (

111 2004 ( ( ( ( ( ,280,000 (A (1 ( (3 (4-8 -

112 2004 ( ( (5 (6 (7 (1 (2-9 -

113 2004 ( ( (8 (9 (

114 2004 ( ( (10 ( 0% - 30% 0% - 100% 50% - 100% 100% (

115 2004 ( ( (12 20%20% 20% 20% 20%20% 10 (

116 2004 ( ( (13 ( % 4.5% % 10% 5 10% 18% 5 10% 18% 5 10% 18% / 2% 9%

117 2004 ( ( (14 (

118 2004 ( ( (16 (17 (18 (

119 2004 ( ( (20 (21 ( % 10%

120 2004 ( (i 17% 17% 17% (ii 3% (iii (1 15% 70% 10% % 10% ( % (2 ( ( % ( % (3 33% ( % (4 ( 17.5% ( %

121 2004 ( 5,000,000 4,500,000 90% - 5,500,000 4,950,000 90% - 5,000,000 3,500,000 70% - 1,000, ,000 90% 9% 1,000, ,000 90% - 1,000, ,000 90% - ( 10, % - ZPMC(MSDN.BHD. 100, % ZPMC (M SDN. BHD. 10%

122 2004 ( ,323 98,158 1,514,424, ,975,633 12,449,677 20,178,931 1,527,021, ,252, ,971, ,272, , ,237, , ,544,279 7, ,074 1, , ,094, ,527,021,328 (9,492, ,517,528, (283,252,722 1,234,276,

123 2004 (

124 2004 ( ( ,776,787,158 1,971,858,327 (43,159,432 (18,035,996 2,733,627,726 1,953,822,331 (a % % 2,364,696, ,827,408, ,233, ,255, ,028,350 1 (14,924,286 50,541,623 3 (14,383,143 27,176,236 1 (24,582, ,652,765 - (3,652,765 3,652,853 - (3,652,853 2,776,787, (43,159,432 1,971,858, (18,035,

125 2004 ( ( 2 ( (a ( (1 APPA 3,652,765 (2 22,455,719 10,244,511 12,211,208 PECEM 2,126,662 (3 29,498,654 14,924,

126 2004 ( ( 2 ( (a ( (4 256,139,520 ( RTT 16,387,866 4,138,632 10,442,028 (b (c 5%(5% 1,101,541,070 40%

127 2004 ( ( ,608,683 98,652,737 (11,736,425 (1,778,347 49,872,258 96,874,390 (a % % 46,831, ,335, ,155, ,664, (1,778,347 11,977, (11,736,425 1,001, , , ,608, (11,736,425 98,652, (1,778,347 11,736,425 ( ,158, ( ,158,

128 2004 ( ( 3 ( (a ( 7,874, ,000,715 9,875,596 12,546,813 1,778,347 9,958,078 (b (c 5%(5% 47,621,160 77% ,678, ,228,641 (a (b 5%(5%

129 2004 ( ( ,702, ,229,948 3,477,136,396 1,692,189,829 4,350,838,972 2,175,419,777 : (19,681,012 (22,804,029 4,331,157,960 2,152,615, ,976, ,456-15,832,625 7,827,860 3,848,387 (7,827,860 3,848,387 22,804,029 4,704,843 (7,827,860 19,681,

130 2004 ( ( (1 6,377, , ,566,375 (2 67,973,745-1,871,048 - (1,711,320 68,133,473 (3 7,920, ,920,489 82,271,915-2,059,742 - (1,711,320 82,620,

131 2004 ( ( 6 ( ( ( % 3,500, ,278 3,602, ,694 3,791, % 1,000,000-1,000, ,000, % 900, , , % 900, , ,000 ZPMC (M SDN. BHD % 4 (24,907 (24, (24,903 6,300, ,371 6,377, ,694 6,566,375 (

132 2004 ( ( 6 ( ( ( % 67,040,000 1,093,473 67,973,745 1,871,048 (1,711,320 68,133, ,113, ,979,303 (1,711,320 (6,845,280 10,267,

133 2004 ( ( 6 ( ( ,120, % ,000 10% ,000 10% ,000,000 10% 7,920,

134 2004 ( ( ,279,527, ,117,507 59,371, ,154,958 10,926,984 2,313,098, ,891, ,789,775 2,858,700 27,585,064 6,703, ,827,913 11,096, ,452,343 4,076,064 49,770,937 1,163, ,559, ,860,514,995 1,012,359,625 66,305, ,510,959 18,793,883 3,245,485, ,312, ,587,178 27,970, ,857,446 5,807, ,534,602 59,354,875 74,462,503 7,475,877 35,277,357 1,232, ,803, ,667, ,049,681 35,445, ,134,803 7,040, ,337, ,628,847, ,309,944 30,859, ,376,156 11,753,648 2,538,147, ,107,215, ,530,329 31,401, ,297,512 5,119,321 1,783,563,

135 2004 ( ( ,000,000 42,303,887 53,071,784 (95,375, ,000, ,495,178 57,800,621 (371,295, ,000,000 35,970, ,916,932 (166,008,371 53,879,222 49% 40,000,000 18,653,935 1,566,438 (20,220,373-17,000,000 6,854,140 4,595,308 (11,449,448-15,700,000 2,955,761 11,513,330 (14,334, ,000 91% 19,000,000 1,877,368 16,986,864 (18,864,232-3,500,000-2,546,701 (2,546,701-7,000,000-7,055,725 (7,055, ,500,000-2,572,981 (2,572, ,800,000-5,843,213 (5,843, ,774,200-13,782,064 (13,782, ,400,000-3,479,244 (3,479, ,110, ,731,205 (732,827,913 54,014,222 17,531,865 16,195,365 (33,727, %( % -32-

136 2004 ( ( / 50,224,331 (16,434,256 35,326,219 - (1,536,144 33,790, ,621,805 (3,621, ,663 - (205, ,310,344 (6,267,245 1,706,305 - (663,206 1,043, ,264,850 (1,090, ,630 - (243, , ,421,330 (27,414,096 37,655,817 - (2,648,583 35,007,

137 2004 ( ( ,174, ,773, ,662,681 ( ,071, ,130,447 10,694,

138 2004 ( ( ( ((6(d - 41,383,500 2,996,775,000 1,614,143,370 2,996,775,000 1,655,526, ,000,000 ( ,100, %4.70% ( %5.31% ,237, %4.08% ( %3.52% 10,409,205 ( ,679,

139 2004 ( ( 14 (1 5%(5% (2 5%(5% ( ,023,369 - ( ((6(e 44,808,006 6,499,406 9,058,899 3,759,331 3,515,722 2,141,148 1,834,920 1,359,923 ( ((6(e 1,772,762 2,168,083 8,141,125 9,811, ,154,803 25,739,

140 2004 ( 5%(5% -37-

141 2004 ( ( ( - 32,111,200 (32,111, ,222,500 (19,222, ,300 (366,300 - B - 22,000,000 (22,000,000 - A - 17,600,000 (17,600, ,300,000 (91,300, /( (43,674,165 (285,620,349 57,395,183 26,297,491 1,758,387 1,229,389 15,479,405 (258,093, ,052, ,203,653 21,000,000 6,000,000 18,171,941 10,543,138 1,849, ,073, ,746,

142 2004 ( ( ( 27 85,650,515 18,520, ,000,000 (EUR/USD ,000,000 (EUR/USD ,000,000 (EUR/USD ,000,000 (EUR/USD ,000,000 (EUR/USD ,500,000 (USD/RMB ,500,000 (USD/RMB ,000,000 (EUR/USD ,000,000 (EUR/USD ,000,000 (EUR/USD ,000,000 (EUR/USD ,000,000 (EUR/USD ( ((6(d 505,000,000 35,000, ,000, ,000, ,817, ,531, ,817, ,531, %6.03%( %6.03% 160,000,000 ( ,000, ,000,000 28,200,000 (2003 9,800,

143 2004 ( ( ,637, ,871, RMB 36,000, % RMB 138,600, % USD 82,765, LIBOR+0.8% RMB 20,000, % RMB 30,000, % RMB 45,000, % RMB 250,000, % USD 397,272, % 999,637, ,272,000 ( ,000,000 ( ((6(d -40-

144 2004 ( ( ,556, ,556, ,112,000-97,944,000 97,944, ,888, ,500, ,500, ,000,000-88,000,000 88,000, ,280, ,280, ,000, ,000, ,000, ,500, ,500, ,280,000 1,027,280, ,500, ,500, ,500,000 ( ( ,280, ,903, ,280, ,280, ,623,026 (

145 2004 ( ( ,130, ,623,026 (273,900,000 1,570,853,966-40,910,290 - (4,700,062 36,210,228-83,451,731 4,700,062-88,151, ,756,848-4,756,848 1,116,492, ,079,936 (278,600,062 1,699,972, ,280, ,027,280, ,640, ,398,949 96,398,949 86,269, ,067,821 45,801,943 45,801, ,108, ,712, ,200, ,200, ,378, ,780,452 (1 10% 50% (2 5%10% ( % -42-

146 2004 ( ( ,668, ,446, ,907, ,692,747 ( (23 (45,801,943 (28,056,967 ( (23 (45,801,943 (28,056,967 ( (23 (206,108,745 (28,056,967 (182,600, (91,300,000 (91,300, ,963, ,668, ,027,280, ,273, (a ,496,970,073 4,415,132, ,694, ,628,906-81,800,658-5,610,683 7,109,664,330 4,628,172, ,655,182,192 3,952,670, ,760, ,535,140-42,835,616-3,744,022 6,236,943,087 4,117,785,

147 2004 ( ( 25 ( (b ( (i 1,835,683,501 1,633,131,866 1,911,139,125 1,687,797,764 1,697,364,596 1,472,016, ,629, ,268,610 ( 1,675,798,551 1,504,232, ,735, ,863,175 1,379,520,690 1,172,769, ,359, ,494, ,086, ,465, ,004, ,163,190 19,014,216 15,158, , , , ,632 43,384 28,191 7,109,664,330 6,236,943,087 4,628,172,800 4,117,785,022 (i (c 2,241,276,186 32% -44-

148 2004 ( ( ,148,584 5,784,161 4,815,468 3,724,514 1,500, ,317 12,464,803 10,392, ,634, ,517,833 (10,742,978 (26,255,815 52,642,082 54,445,483 (53,231,706 (48,657,510 ( 18 85,650,515 18,520,354 5,465,819 1,826, ,418, ,397,

149 2004 ( ( ( 6 2,059,742 11,232,070 (1 1,151,969 1,238,998 ( 6 (1,711,320 (1,711,320 1,500,391 10,759,748 1 ( ,000,000 4, ,000 47, ,878,200 42,965,871 (34,308,949 - ( 11 (19,436,035 (10,694,412 9,133,216 32,271,459 ( ,308,

150 2004 ( (

151 2004 ( ,827,780,196 2,044,701,398 (43,159,432 (18,035,996 2,784,620,764 2,026,665,402 (a % % 2,377,534, ,900,251, ,918, ,255, ,498,654 1 (14,924,286 50,541,623 2(14,383,143 27,176,236 1 (24,582, ,652,765 - (3,652,765 3,652,853 - (3,652,853 2,827,780, (43,159,432 2,044,701, (18,035,

152 2004 ( ( 1 ( (a ( (1 APPA 3,652,765 (2 22,455,719 10,244,511 12,211,208 PECEM 2,126,662 (3 29,498,654 14,924,

153 2004 ( ( 1 ( (a ( (4 295,832,670 ( RTT 16,387,866 4,138,632 10,442,028 (b (c 5%(5% 1,539,507,375 54% -50-

154 2004 ( ( ,302, ,103,054 (11,736,425 (1,778, ,566, ,324,707 (a % % 124,710, ,017, ,155, ,432, (1,778,347 11,977,213 9 (11,736,425 1,001, , , ,302, (11,736, ,103, (1,778,347 (b (c 5%(5% 120,701,181 87% -51-

155 2004 ( ( (1 18,991, , ,146,862 (2 67,973,745-1,871,048 - (1,711,320 68,133,473 (3 7,920, ,920,489 94,885,527-2,026,617 - (1,711,320 95,200,

156 2004 ( ( 3 ( ( ( 11 ( % 4,500,000 3,396,885 7,802,100-94,785 7,896, % 4,950, ,502 5,047,997-64,505 5,112, % 3,500, ,278 3,602, ,694 3,791, % 900, , , % 900, , , % 900, , ,000 ( % - (328,900 (136,485 - (192,415 (328,900 ZPMC (M SDN. BHD % 4 (24,907 (24, (24,903 15,650,004 3,496,858 18,991, ,569 19,146,

157 2004 ( ( 3 ( ( ( % 67,040,000 1,093,473 67,973,745 1,871,048 (1,711,320 68,133, ,113, (1,711,320 (6,845,280 10,267,

158 2004 ( ( 3 ( ( ,120, % ,000 10% ,000 10% ,000,000 10% 7,920,

159 2004 ( ( ,493,825,003 4,415,132, ,102, ,628,906-81,800,658-5,610,683 7,099,927,106 4,628,172, ,674,273,059 3,967,718, ,336, ,989,447-43,000,517-3,748,354 6,254,609,529 4,133,457, ( 3 2,026,617 11,202,150 (1 1,151,969 1,238,998 ( 3 (1,711,320 (1,711,320 1,467,266 10,729,828 1 ( ( ,000,000 4, ,000 47,

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168 2004 ( ( ,908 3,465,997 (29,482 (29, ,426 3,436,

169 2004

170 2004 ( (1 (% (/ 872, % 37.89% , % 20.15% , % 19.85% , % 19.57% ( ,814 19,814 39,220 39,220 (4,139 (4,139 54,895 54,895 18,036 18,036 29,262 29,262 (4,139 (4,139 43,159 43,159 1,778 1,778 9,958 9, ,736 11, ,804 22,804 4,705 4,705 (7,828 (7,828 19,681 19,681 7,828 7,828 3,848 3,848 (7,828 (7,828 3,848 3,848 14,976 14, ,833 15,

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172 : :L: AWZ : : ( 2004 A 1.CALLOVER Initials Sentto 1st 2nd Final Calledoverby to to to Additionscheckedby Crossreferencedby Cross-checktoEnglishversionby Proofreadby(Manager 2.REVIEWEDANDAPPROVEDFORPRINTINGBY Manager Partner 3.TOPRINTINGROOM Accounts Letterhead Auditorscopy PWDH Taxcopy PWASIA AGMcopy Other Additional TechDeptcopy Total No.of pages TypeofBinding Staple Plastic Requiredby Date Time *****This page is generated by the word processing***** centre and is not part of the report

173 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. (Incorporated in the People s Republic of China with limited liability CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004

174 Mailing Address: 11F PricewaterhouseCoopers Center 202 Hu Bin Road Shanghai People s Republic of China Telephone: +86 ( Facsimile: +86 ( REPORT OF THE AUDITORS TO THE SHAREHOLDERS OF SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. (Incorporated in the People s Republic of China with limited liability We have audited the accompanying consolidated balance sheet of Shanghai Zhenhua Port Machinery Co., Ltd. ( the Company and its subsidiaries ( the Group as of 31 December 2004 and the related consolidated statements of income, cash flows and changes in shareholders equity for the year then ended. These consolidated financial statements set out on pages 2 to 27 are the responsibility of the Company s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of 31 December 2004 and the results of its consolidated operations and its consolidated cash flows for the year then ended in accordance with International Financial Reporting Standards. PricewaterhouseCoopers China Limited 7 April 2005 Business is undertaken in the registered name of PricewaterhouseCoopers China Limited, incorporated in Bermuda with limited liability. Registered address is Clarendon House, 2 Church Street, Hamilton, Bermuda.

175 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. CONSOLIDATED INCOME STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated Notes Sales 3 7,109,664 4,628,173 Cost of sales (6,237,435 (4,120,659 Gross profit 872, ,514 Other operating profit 5 13,118 7,670 Distribution expenses (17,165 (13,408 Administrative expenses (192,207 (97,162 Profit from operations 4 675, ,614 Finance costs - net 6 (210,266 (104,158 Profit before tax 465, ,456 Share of net profit of unconsolidated subsidiaries Share of net profit of an associate ,436 Profit before tax 466, ,976 Income tax expense 8 (38,615 (32,271 Profit before minority interests 427, ,705 Minority interests 9 (17 (12 Net profit 427, ,693 Earnings per share 10 RMB 0.47 RMB 0.30 The accompanying notes form an integral part of these consolidated financial statements

176 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. CONSOLIDATED BALANCE SHEET AT 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated ASSETS Notes 31 December December 2003 Non-current assets Property, plant and equipment 11 2,405,031 1,784,688 Construction in progress 12 54, ,111 Land use rights ,124 36,327 Intangible assets Investments in unconsolidated subsidiaries 15 6,566 6,377 Investment in an associate 16 68,133 67,973 Available-for-sale investments 17 7,921 7,921 Long-term receivables , ,773 Deferred income tax assets 19 30,131 10,694 2,918,095 2,665,070 Current assets Stocks and contract costs incurred 20 4,331,158 2,152,616 Receivables and prepayments 21 3,180,951 2,180,925 Cash and cash equivalents 22 1,527, ,253 9,039,130 4,616,794 Total assets 11,957,225 7,281,864 EQUITY AND LIABILITIES Capital and reserves Share capital 26 1,027, ,500 Reserves 27 2,276,754 1,395,561 Retained earnings 132, ,668 3,436,515 2,128,729 Minority interests 9 1,445 1,428 Non-current liabilities Borrowings , ,872 Current liabilities Trade and other payables 23 3,603,315 1,373,862 Income tax payable 57,395 26,297 Value added tax recoverable (43,674 (285,620 Dividends payable Borrowings 25 3,902,592 3,174,296 7,519,628 4,288,835 Total liabilities 8,519,265 5,151,707 Total equity and liabilities 11,957,225 7,281,864 On 7 April 2005, the Board of Directors of Shanghai Zhenhua Port Machinery Co., Ltd. authorised these financial statements for issue. The accompanying notes form an integral part of these consolidated financial statements

177 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS EQUITY FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated Share Retained capital Reserves earnings Total (Note 27 Balance at 31 December ,500 1,311, ,446 1,942,336 Net profit for , ,693 Appropriation to reserves - 84,171 (84,171 - Dividend relating to (91,300 (91,300 Balance at 31 December ,500 1,395, ,668 2,128,729 A share public offering 114, , ,660 Appropriation to share capital 456,500 (273,900 (182,600 - Net profit for , ,426 Appropriation to reserves - 297,713 (297,713 - Dividend relating to (91,300 (91,300 Balance at 31 December ,027,280 2,276, ,481 3,436,515 The accompanying notes form an integral part of these consolidated financial statements

178 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated CASH FLOWS FROM OPERATING ACTIVITIES Profit before tax 466, ,976 Adjustments for: Depreciation on property, plant and equipment 178, ,624 Amortization of intangible assets Amortization of land use rights 1,536 1,516 Impairment charge for bad and doubtful debts 35,081 2,999 (Reversal of/provision for stock obsolescence (3,123 6,625 (Gains/losses on disposal of property, plant and equipment ( Fair value losses on foreign forward contracts 85,651 18,520 Interest income (3,201 (26,256 Interest expense 131, ,518 Dividend income (1,152 (1,239 Share of net profit of unconsolidated subsidiaries (189 (84 Share of net profit of an associate (160 (9,436 Changes in working capital: Increase in restricted cash (9,492 - Increase in receivables and prepayments (884,509 (82,737 Increase in stocks and contract costs incurred (2,175,419 (1,272,448 Increase in trade and other payables, income tax payable and value added tax recoverable 2,330, ,008 Cash generated from/(used in operations 151,171 (129,999 Interest paid (142,131 (115,361 Income tax paid (11,393 (21,749 Net cash used in operating activities (2,353 (267,109 The accompanying notes form an integral part of these consolidated financial statements

179 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. CONSOLIDATED CASH FLOW STATEMENT (CONTINUED FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property, plant and equipment and land use rights and payments on construction in progress (513,725 (422,889 Proceeds from sales of property, plant and equipment 580 2,318 Interest received 3,201 27,926 Dividends received 1,152 1,239 Net cash used in investing activities (508,792 (419,332 CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issuance of domestic listed Renminbi ordinary shares 971,660 - Proceeds from borrowings 5,491,677 4,327,604 Repayments of borrowings (4,626,616 (3,383,969 Dividends paid to shareholders (91,300 (86,562 Net cash generated from financing activities 1,745, ,073 Increase in cash and cash equivalents 1,234, ,558 Cash and cash equivalents at beginning of year 283,253 84,695 Cash and cash equivalents at end of year 1,517, ,253 The accompanying notes form an integral part of these consolidated financial statements

180 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 1 GENERAL INFORMATION Shanghai Zhenhua Port Machinery Co., Ltd. ( the Company was established in Shanghai, the People s Republic of China (the PRC, on 8 September 1997 as part of an exercise to reorganise its predecessor, Shanghai Zhenhua Port Machinery Company Limited ( Zhenhua, a Sino-foreign equity joint venture enterprise, into a joint stock limited company. The Company s domestically listed foreign shares ( B shares and Renminbi ordinary shares ( A shares are listed on the Shanghai Stock Exchange. The Company, together with its consolidated subsidiaries, are hereinafter collectively referred to as the Group. The principal activities of the Company consist of the design, manufacture, sale, and installation of port machinery, project vessels, steel structure and related spare parts and accessories; lease of self-manufactured container cranes; provide marine forwarding services with specific vessels for container cranes and engage in steel structure construction project. As approved in CSRC (2004 No.165 Approval on Additional Public Offering of Shanghai Zhenhua Port Machinery Co., Ltd. issued by China Securities Regulatory Commission on 14 December 2004, the Company issued 114,280 thousand domestic listed Renminbi ordinary shares (A shares on 23 December The Company has not obtained the revised Business License and the Certificate of Approval for Establishment of Enterprises with Foreign Investment in the People s Republic of China. 2 ACCOUNTING POLICIES (a Basis of preparation The Group maintains its books and prepares its statutory financial statements in accordance with relevant accounting regulations in the PRC. These accounting regulations differ in certain respects from International Financial Reporting Standards( IFRS. These consolidated financial statements incorporate adjustments made to the statutory financial statements in order to conform with International Financial Reporting Standards. The preparation of financial statements in conformity with generally accepted accounting principles requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on management s best knowledge of current events and actions, actual results ultimately may differ from those estimates. (b Consolidation Subsidiaries, which are those entities in which the Group, directly or indirectly, has an interest of more than one half of the voting rights or otherwise has power to govern the financial and operating policies, are consolidated. Subsidiaries are consolidated from the date on which effective control is transferred to the Group and are no longer consolidated from the date that control ceases. All material intercompany transactions, balance and unrealised profit on transactions between group companies are eliminated. Where necessary, accounting policies for subsidiaries have been changed to ensure consistency with the policies adopted by the Group. Separate disclosure is made of minority interest. Certain subsidiaries that are insignificant to the Group are not consolidated. Investments in these unconsolidated subsidiaries are accounted for using the equity method of accounting. A listing of the Group s consolidated and unconsolidated subsidiaries is set out in Note 31 (a and (b

181 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 2 ACCOUNTING POLICIES (CONTINUED (c Foreign currency translations Transactions denominated in foreign currencies are translated into Renminbi at the exchange rates stipulated by the People s Bank of China prevailing on the first day of the month in which the transactions took place. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are translated into Renminbi at the exchange rates stipulated by the People s Bank of China. Exchange differences arising from these translations are taken to the income statement. Income statements of foreign entities are translated into Renminbi at average exchange rates for the year and their balance sheets and cash flow statements are translated at the exchange rates ruling on balance sheet day. Exchange differences arising from the translations of the net investment in foreign entities are taken to shareholder s equity. When a foreign entity is sold, such exchange differences are recognized in the income statement as part of the gain or loss on sale. (d Property, plant and equipment All property, plant and equipment is stated at historical cost less depreciation. Depreciation is calculated on the straight line basis to write off the cost of each asset, after taking into account their residual values, over their estimated useful lives as follows: years Buildings 20 Plant and machinery 10 Motor vehicles 5 Office and other equipment 5 Gains and losses on disposals are determined by comparing proceeds with carrying amounts and are included in profit from operations. Repairs and maintenance are charged to the income statement during the period in which they are incurred. The cost of major renovations is included in the carrying amount of the asset when it is probable that future economic benefits in excess of the originally assessed standard of performance of the existing asset will flow to the Group. Major renovations are depreciated over the remaining useful life of the related asset. (e Construction in progress Construction in progress represents capital assets under construction or being installed and is stated at cost. Cost comprises original cost of plant and equipment, installation, construction and other direct costs including borrowing costs on loans borrowed to finance the capital assets incurred prior to the date of reaching their expected usable condition. Construction in progress is transferred to the fixed assets account when it has been substantially completed or has reached its expected usable condition

182 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 2 ACCOUNTING POLICIES (CONTINUED (f Land use rights Land use rights are stated at cost less accumulated amortisation. Amortisation is calculated on the straight-line basis over the approved useful period. (g Intangible assets Intangible assets, comprising proprietary technology relating to technical design and drawings, are stated at cost. They are amortised on the straight-line basis over 10 years. (h Impairment of long-lived assets Property, plant and equipment, construction in progress, land use right and intangible assets are reviewed for impairment losses whether events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the carrying amount of the assets exceeds its recoverable amount which is the higher of an asset s net selling price and value in use. (i Investments in associates Investments in associates are accounted for by the equity method of accounting. Associates are entities over which the Group generally has between 20% and 50% of the voting rights, or over which the Group exercises significant influence, but which it does not control. Equity accounting involves recognizing in the income statement the Group s share of the profit or loss of the associates for the year. The Group s interest in the associates is carried in the balance sheet at an amount that reflects its share of the net assets of the associates. Goodwill on acquisition of associates is included in investments in associates. Goodwill represents the excess of the cost of acquisition over the fair value of the Group s share of the net assets of the acquired associates at the date of acquisition. Goodwill is amortised using the straight-line method over 10 years. The details of the Group s associate are set out in Note 31 (c. (j Available-for-sale investments Investments other than investments in subsidiaries and associates are intended to be held for an indefinite period of time, which may be sold in response to needs for liquidity or changes in interest rates, are classified as available for sale, and are included in non-current assets unless management has the express intention of holding the investment for less than 12 months from the balance sheet date or unless they will need to be sold to raise operating capital, in which case they are included in current assets. (k Stocks and contract costs incurred Stock, comprising raw materials, purchased parts and contracts in progress are presented at the lower of cost or net realizable value. Cost of raw materials and purchased parts are calculated on the weighted average basis. Cost of contracts in progress comprises raw materials, direct labor and related production overheads (based on normal operating capacity but excluded borrowing costs. Estimated net realizable value is determined on the basis of the contract value less costs of completion and estimated shipping and other related expenses

183 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 2 ACCOUNTING POLICIES (CONTINUED (l Trade receivables Trade receivables are carried at original invoice amount less provision made for impairment of these receivables. A provision for impairment of trade receivable is established when there is an objective evidence that the Group will not be able to collect all amounts due according to the original terms of receivables. The amount of the provision is the difference between the carrying amount and the recoverable amount. (m Cash and cash equivalents For the purposes of the cash flow statement, cash and cash equivalents comprise cash on hand and deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less. (n Revenue recognition Revenue is recognized when the contract work has progressed to the stage where assembly of the cranes have been completed and the cranes are ready for delivery. All production costs incurred and all costs which are expected to be incurred after assembly, including shipment, installation and estimated after-sale costs are accrued at the point of revenue recognition. Interest income earned by the Group is recognised on the accrual basis unless its collectibility is in doubt. (o Dividends Dividends are recorded in the Group s financial statements in the period in which they are approved by the Group s shareholders. (p Operating leases Leases where a significant portion of the rewards and risks of ownership of assets remain with the lessor are accounted for as operating leases. Rental applicable to such operating lease is charged to the income statement on the straight-line basis over the lease term. Assets leased out under operating leases are included in property, plant and equipment in the balance sheet. They are depreciated over their expected useful lives on a basis consistent with similar owned property, plant and equipment. Rental income is recognised on the straight-line basis over the lease term. (q Deferred income taxes Deferred income tax is provided, using the liability method, for all temporary differences arising between the tax bases of assets and liabilities and their carrying amount in the financial statements. Currently enacted tax rates are used to determine deferred income tax. Deferred income tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised

184 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 2 ACCOUNTING POLICIES (CONTINUED (r Retirement benefits The Group participates in a government defined contribution pension scheme whereby it is required to contribute to the scheme at 22.5% from January to September 2004 and 22% since September 2004 (2003: 22.5% of the wages of existing permanent employees. In addition, the Group also provides additional 20% of the wages of existing permanent employees for defined contribution pension purpose which may be converted into or merged with the above pension scheme in future. The scheme and the additional provision are intended to cover the retirement benefits obligations. Both of the above amounts are charged to the income statement in the period in which they are incurred. (s Financial instruments Financial instruments carried on the balance sheet include cash and cash equivalents, investments, receivables, payables and borrowings. The particular recognition methods adopted are disclosed in the individual policy statements associated with each item. (1 Financial risks The Group s activities expose it to a variety of financial risks, including the effects of changes in debt and equity market prices, foreign currency exchange rates and interest rates. The Group uses derivative financial instruments such as foreign exchange contracts to hedge certain exposures. (a Interest rate risk The Group s income and operating cash flows are primarily independent of changes in market interest rates. The interest rates and terms of repayment of borrowings are disclosed in Note 25. Other financial assets and liabilities do not have material interest rate risk. (b Credit risk Trade receivables are spread among a number of customers, mainly outside the PRC, and cash is deposited with reputable banks registered in the PRC. The Group has policies in place to ensure that sales of products are made to customers with appropriate guaranteed letters from the registered banks of the customers home countries. The directors are of the opinion that the Group has no significant concentrations of credit risk. The carrying amounts of the financial assets after deducting the impairment charge represent their maximum credit risk. (c Foreign exchange risk The Group sells to customers around the world and is exposed to foreign exchange risk arising from various currency exposures primarily with respect to US dollars and Euro. The Group uses foreign forward contracts transacted with domestic and overseas registered banks, to hedge its exposure to foreign currency risk in connection with Renminbi

185 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 2 ACCOUNTING POLICIES (CONTINUED (s Financial instruments (continued (d Fair value The carrying values of financial assets and liabilities with a maturity of less than one year approximate their fair values. The fair values of non-current financial assets and liabilities for disclosure purposes are estimated by discounting the future cash flows at the current market interest rates available to the Group for similar financial instruments. (2 Accounting for derivative financial instruments and hedging activities Derivative financial instruments are initially recognized in the balance sheet at cost and are subsequently remeasured at their fair value. The method of recognizing the resulting gain or loss is dependent on whether the derivative financial instrument is designated as a hedging instrument, and if so, the nature of the item being hedged. Certain derivative financial instruments are designated as either (1 hedges of the fair value of recognized assets or liabilities or a firm commitment (fair value hedge or (2 hedges of highly probable forecasted transactions (cash flow hedge. Changes in the fair value of derivatives that are designated and qualify as fair value hedges and that are highly effective, are recorded in the income statement, along with any changes in the fair value of the hedged assets or liabilities that are attributable to the hedged risk. Changes in the fair value of derivatives that are designated and qualify as cash flow hedges and that are highly effective, are recognized in equity. Where the forecasted transaction results in the recognition of an asset or of a liability, the gains and losses previously deferred in equity are transferred from equity and included in the initial measurement of the cost of the asset or liability. Otherwise, amounts deferred in equity are transferred to the income statement and classified as revenue or expense in the same period during which the hedged forecasted transaction affects the income statement. Certain derivative financial instruments do not qualify for hedge accounting. Changes in the fair value of derivative financial instruments that do not qualify for hedge accounting are recognized immediately in the income statement. (t Comparatives Where necessary, comparative figures have been reclassified to conform with changes in presentation in the current year

186 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 3 SEGMENT INFORMATION Sales to geographic segments based on the countries where the customers are located are as follows PRC mainland (exports 1,835,684 1,911,139 PRC mainland 1,697, ,630 Asia (Excluding PRC mainland 1,675, ,736 America 1,379, ,360 Europe 502, ,004 Africa 19, Oceania ,109,664 4,628,173 Sales shown in PRC mainland (exports represents those sales first export from the Company to Zhenhua Port Machinery (Hongkong Co., Ltd., the subsidiary of the Company, and then sold by this subsidiary to the respective customers domiciled in PRC mainland. 4 PROFIT FROM OPERATIONS The following items have been charged in arriving at profit from operations: Depreciation on property, plant and equipment (Note , ,624 Amortisation of land use rights (Note 13 1,536 1,516 Staff costs (Note 7 214, ,413 Impairment charge for bad and doubtful debts (Note 21 35,081 2,999 (Reversal of/provision for stock obsolescence (Note 20 (3,123 6,625 Amortisation of intangible assets (Note Operating lease rental 23,166 10,782 (Gains/losses on disposal of property, plant and equipment (

187 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 5 OTHER OPERATING PROFIT Rental income 6,149 5,784 Others 6,969 1,886 13,118 7,670 Rental income represents the leasing of floating cranes to customers for the installation of equipment and steel structure. 6 FINANCE COSTS - NET Interest income - bank deposits (5,068 (999 - long-term receivables (5,675 (25,257 Interest expense - bank borrowings 131, ,285 - loan from a related company (Note 32 (c 274 4,233 Net foreign exchange (gain/loss (590 5,788 Fair value losses on derivative financial instruments - foreign forward contracts(note 28 85,651 18,520 Bank charges 5,465 1,827 Dividend income (1,152 (1, , ,158 7 STAFF COSTS Wages and salaries 133,084 91,121 Pension costs 35,891 31,668 Staff welfare and benefits 45,040 29, , ,413 Monthly average number of persons employed by the Group during the year - full time 1,932 1,871 - temporary

188 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 8 INCOME TAX EXPENSES Current tax charge 58,052 42,965 Deferred tax (Note 19 (19,437 (10,694 38,615 32,271 Income tax is provided in accordance with the prevailing income tax regulations in the PRC at a preferential rate of 10% of taxable profit. The tax on the Group s profit before tax differs from the theoretical amount that would arise using the tax rate of the Company as follows: Profit before tax 466, ,976 Tax calculated at a tax rate of 10% (2003: 10% 46,606 30,998 Income not subject to tax (147 (1,073 Expenses not deductible for tax purposes 16,420 13,040 Tax charge 62,879 42,965 Investment tax credit amortisation (4,827-58,052 42,965 According to Cai Shui Zi (2000 No.49, foreign investment enterprise and foreign companies can claim enterprise income tax credit on 40% of the cost of certain qualified equipment manufactured in the PRC. As approved by National Tax Bureau of Shanghai Municipal in year 2004, 34,309 thousand tax credit was received and recorded in deferred income, and 4,827 thousand was amortised into income tax expenses to match against depreciation over the life of the related equipment. 9 MINORITY INTERESTS At beginning of year 1,428 1,416 Share of net profit of subsidiaries At end of year 1,445 1,

189 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 10 EARNINGS PER SHARE The calculation of earnings per share is based on the net profit for the year of 427,426 thousand (2003: 277,693 thousand and the weighted average number of ordinary shares in issue of 915,505 thousand (2003: 913,000 thousand Net profit for the year 427, ,693 Weighted average number of shares in issue for the year (in thousands 915, ,000 Earnings per share Rmb 0.47 Rmb PROPERTY, PLANT AND EQUIPMENT Cost Office Plant and Motor and other Buildings machinery vehicles equipment Total At 01 January ,165, , ,792 49,041 1,938,937 Additions 118, ,027 43,870 22, ,013 Disposals - (4,106 (507 (167 (4,780 At 31 December ,284, , ,155 71,562 2,319,170 Additions 447, ,240 77,356 14, ,053 At 31 December ,731,987 1,012, ,511 86,365 3,118,223 Accumulated depreciation At 01 January , ,109 78,498 28, ,110 Charge for the year 53,254 56,344 23,583 6, ,624 Disposals - (1,866 (224 (162 (2,252 At 31 December , , ,857 34, ,482 Charge for the year 60,020 74,463 35,277 8, ,710 At 31 December , , ,134 43, ,192 Net book value At 31 December ,495, , ,377 42,788 2,405,031 At 31 December ,107, , ,298 36,935 1,784,

190 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 12 CONSTRUCTION IN PROGRESS 31 December December 2003 At beginning of year 422, ,286 Additions during the year 231, ,239 Transfer to property, plant and equipment (599,494 (258,414 At end of year 54, ,111 Interest capitalised in construction in progress amounted to 16,195 thousand (2003: 17,053 thousand and is calculated based on the Company s average cost of borrowings for the year of 5.59% (2003: 5.74% per annum. 13 LAND USE RIGHTS Cost 31 December December 2003 At beginning of year 47,132 47,132 Additions 133,333 - At end of year 180,465 47,132 Accumulated amortisation At beginning of year 10,805 9,289 Charge for the year 1,536 1,516 At end of year 12,341 10,805 Net book value at end of year 168,124 36,327 The average remaining use period for the land use rights is approximately 46.5 years

191 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 14 INTANGIBLE ASSETS Year ended 31 December 31 December December 2003 Net book value at beginning of year Amortization charge (206 (205 Net book value at end of year At 31 December Cost 4,022 4,022 Accumulated amortization (4,022 (3,816 Net book value at end of year INVESTMENTS IN UNCONSOLIDATED SUBSIDIARIES 31 December December 2003 At beginning of year 6,377 6,293 Share of net profit of unconsolidated subsidiaries At end of year 6,566 6,377 The Company has subsidiaries that are insignificant to the Group and are not consolidated. Details of the unconsolidated subsidiaries are shown in Note 31 (b. 16 INVESTMENT IN AN ASSOCIATE 31 December December 2003 At beginning of year 67,973 58,537 Share of net profit of an associate 160 9,436 At end of year 68,133 67,973 The share of net profit of an associate includes amortisation of goodwill of 1,711 thousand (2003: 1,711 thousand relating to the acquisition of the associate, Shanghai Zhenhua Shipping Co., Ltd. in Investment in an associate at 31 December 2004 includes goodwill of 10,269 thousand, net of accumulated amortisation of 6,844 thousand (2003: 11,980 thousand, net of accumulated amortisation of 5,133 thousand. Details of the associate are shown in Note 31 (c

192 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 17 AVAILABLE-FOR-SALE INVESTMENTS Available-for-sale investments are stated at cost and not subsequent fair valued because they do not have quoted market prices in active markets and whose fair values can not be reliably measured. These investments are subject to review for impairment. 18 LONG-TERM RECEIVABLES The balance represents trade receivables which will become due for payment in installments after 31 December 2005 from certain customers under the terms of the sales agreements. All long-term receivables are due within 4 years from the balance sheet date. The outstanding amounts bear interest at rates ranging from 4.28% to 7.50% (2003: % to 8.5% per annum. Included in long-term receivables are amounts totaling 102,663 thousand (2003: 143,072 thousand which are retained by customers prior to completion of the warranty period of the installed cranes. 19 DEFERRED INCOME TAX ASSETS 31 December December 2003 At beginning of year 10,694 - Income statement charge (Note 8 19,437 10,694 At ending of year 30,131 10,694 Deferred income tax assets at year end mainly resulted from temporary differences arising from provision for impairment of receivables, provision for stock obsolescence, accrued after sales cost, and fair value losses on foreign forward contracts 20 STOCKS AND CONTRACT COSTS INCURRED 31 December December 2003 Raw materials and purchased parts 873, ,230 Contracts in progress 3,477,136 1,692,190 4,350,839 2,175,420 Less: Provision for stock obsolescence (19,681 (22,804 4,331,158 2,152,

193 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 21 RECEIVABLES AND PREPAYMENTS 31 December December 2003 Trade receivables 2,779,787 1,971,858 Prepayments and other receivables 456, ,881 3,235,846 2,200,739 Less : Provision for Impairment of receivables (54,895 (19,814 3,180,951 2,180,925 Concentrations of credit risk with respect to trade receivables are limited due to the Group s large numbers of customers, who are mostly internationally dispersed, together with various payment guarantees provided by the customers banks. The Group s experience normally falls within the recorded provision for impairment. Due to these factors, management believes that no additional credit risk beyond amounts provided for collection losses is inherent in the Group s trade receivables. 22 CASH AND CASH EQUIVALENTS 31 December December 2003 Cash and cash equivalents 1,517, ,253 Restricted cash 9,492-1,527, , TRADE AND OTHER PAYABLES 31 December December 2003 Advances from customers 2,353, ,565 Trade payables 576, ,191 Deposit for trade receivables in US dollar 298,023 - Accrued after-sale cost 138, ,204 Forward foreign contracts (Note 28 85,651 18,520 Amounts due to related companies (Note 32 (d 46,581 8,667 Deferred income (Note 8 29,482 - Accrued payroll 21,319 6,000 Accrued interest expense 18,172 10,543 Welfare payable 7,732 14,871 Other current liabilities 27,931 18,301 3,603,315 1,373,862 Deposit for trade receivables in US dollar represents Rmb cash collected from the customers that are temporarily unable to pay for the trade receivables dominated in US$ upon due. Those deposit will be remit back upon receipt of US dollar for those trade receivables

194 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 24 DIVIDENDS PAYABLE 31 December December 2003 At beginning of year - - Dividends declared for 2003/ ,300 91,300 Amounts paid during the year (91,300 (91,300 At end of year BORROWINGS 31 December December 2003 Current Bank borrowings 3,902,592 3,164,296 Loan from a related company (Note 32 (e - 10,000 3,902,592 3,174,296 Non-current Bank borrowings 999, ,872 4,902,229 4,037,168 All the borrowings are unsecured. (i The weighted average effective interest rates are as follows: 31 December December 2003 Bank borrowings 3.11% 3.35% Loan from a related party 3.51% 3.51% (ii Maturity of non-current borrowings: 31 December December 2003 Between 1 and 2 years 427, ,872 Between 2 and 5 years 571, , , ,

195 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 26 SHARE CAPITAL At 31 Issuance Issuance At 31 December of bonus of additional December 2003 shares A shares 2004 Unlisted shares of Rmb 1 each: Promoters shares 258, , ,000 Listed shares of Rmb 1 each: Domestically listed foreign shares (B Shares 110, , ,000 Domestically listed Renminbi ordinary shares (A Shares 88,000 88, , , , , ,280 1,027,280 All promoters shares, A shares and B shares are registered ordinary shares and carry equal rights. According to the resolution of the Company s Annual General Meeting held on 15 February 2004, bonus shares were appropriated from capital accumulation fund (273,900 thousand and retained earning (182,600 thousand at six and four respectively for every ten issued shares as at 31 December After the issuance of bonus shares, and the share capital increased 456,500 thousand. The increased share capital were verified by PricewaterhouseCoopers Zhong Tian CPAs Ltd. Co. with a capital verification report of PwC ZT Yan Zi (2004 No.214. As approved in CSRC (2004 No.165 Approval on Additional Public Offering of Shanghai Zhenhua Port Machinery Co., Ltd. issued by China Securities Regulatory Commission on 14 December 2004, the Company issued additional A shares of 114,280 thousand on 23 December 2004 with a proceeds of Rmb 971,660 thousand, of which, Rmb 114,280 thousand was credit to share capital and the rest Rmb 857,380 thousand was credit to capital accumulation fund. The increased share capital were verified by PricewaterhouseCoopers Zhong Tian CPAs Ltd. Co. with a capital verification report of PwC ZT Yan Zi (2004 No RESERVES Capital Statutory Discretionary Statutory accumulation accumulation accumulation welfare fund fund fund fund Total At 1 January ,116,493 96,399 86,270 96,399 1,395,561 Share Premium from issuance of additional A shares 857, ,380 Appropriation to share capital (273, (273,900 Appropriation to reserves - 45, ,109 45, ,713 At 31 December ,699, , , ,201 2,276,754 At 1 January ,116,493 68,342 58,213 68,342 1,311,390 Appropriation to reserves - 28,057 28,057 28,057 84,171 At 31 December ,116,493 96,399 86,270 96,399 1,395,

196 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 27 RESERVES (CONTINUED (a Capital accumulation fund Transactions of the following nature are recorded in the capital accumulation fund: (i share premium arising from issue of shares at a price in excess of their par value; (ii excess of the value of the contributed net assets over the par value of the issued shares; (iii any other items required by the PRC regulations to be so treated. According to the PRC accounting regulations, except for unrealized portion, amounts in the capital accumulation fund can be utilized to offset prior years losses or for the issuance of bonus shares. According to the board resolution dated 7 April 2005, a bonus share, to be appropriated from capital accumulation fund at five for every ten issued shares as at 31 December 2004, are to be proposed for shareholders approval at the Company s Annual General Meeting to be held in (b Statutory accumulation fund and statutory welfare fund PRC Company Law requires the Company to appropriate ten percent of its net profit for the year computed in accordance with the PRC accounting regulations (after offsetting prior years losses to the statutory accumulation fund. When the balance of such fund reaches 50 percent of the Company s registered share capital, any further appropriation is optional. The statutory accumulation fund can be utilised to offset prior years losses or for the issuance of bonus shares. However, the fund shall be maintained at a minimum balance equivalent to 25 percent of the registered share capital after any such issue. PRC Company Law also requires a company to appropriate between five percent to ten percent of its net profit for the year computed in accordance with the PRC accounting regulations (after offsetting prior years losses to the statutory welfare fund. The fund should be utilised for the collective benefits of the workforce, including provision of staff quarters or housing. No other distribution shall be made from the fund other than upon liquidation of the Company. In 2004, an amount of 45,802 thousand (2003: 28,057 thousand has been appropriated to each of these funds. (c Discretionary accumulation fund According to the board resolution dated 7 April 2005, in respect of 2004, an amount of 206,109 thousand (2003: 28,057 thousand has been appropriated to discretionary accumulation fund. This proposal is subject to shareholders approval in the Company s Annual General Meeting to be held in

197 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 28 FINANCIAL INSTRUMENTS Foreign forward contracts are entered into by the Group to manage exposure to fluctuations in foreign currency exchange rates on specific transactions. In general the Group s policy is to enter into foreign forward contracts based on the anticipated net monthly foreign currency receipts over the following year. The losses on fair value of unfulfilled foreign forward contracts as at 31 December are: 31 December December 2003 Losses on fair value of foreign forward contracts (Note 23 85,651 18, CONTINGENCIES (a (b The Company entered into certain sales contracts which include provision for various penalties should the Company fail to fulfill its contractual obligations. In some instances, the penalty for failure to deliver the cranes on schedule is equal to the whole contract price. As a result, unforeseen production delays can significantly affect the profitability of certain contracts. The Company entered into certain bid bonds issued by different banks. Should the Company fail to fulfill its contractual obligations, the maximum penalty the Company will be required to pay amounted to 28,944 thousand (2003: 45,332 thousand. 30 COMMITMENTS (a Operating lease commitments The future aggregate minimum lease payments under non-cancelable operating leases are as follows: 31 December December 2003 Not later than 1 year 14,038 8,316 Later than 1 year and not later than 5 years 46,069 33,466 Later than 5 years 120, , , ,323 (b Letters of credit The Company issued several letters of credit for the import of parts. As at 31 December 2004, 887,315 thousand (2003: 740,068 thousand remained unpaid under these letters of credit. (c Capital commitments Capital expenditures contracted for as at the balance sheet date but not recognised in the financial statements amounted to 34,240 thousand as at 31 December 2004 (2003: 154,540 thousand

198 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 31 SUBSIDIARIES, ASSOCIATES AND RELATED PARTIES (a Consolidated subsidiaries At 31 December 2004, the Company s consolidated subsidiaries are set out below: Attributable Country/year Registered equity Principal Name of incorporation capital interest activities Shanghai Zhenhua Port PRC/1996 5,000 thousand 90% Manufacture and Machinery Pudong Co., Ltd. sale of cranes and bearings for cranes Shanghai Zhenhua Port PRC/2001 5,500 thousand 90% Manufacture and Machinery Changxin Spare sale of steel Parts Manufacture Co., Ltd. structures and spare parts for cranes Zhenhua Port Machinery PRC/2002 HKD 10 thousand 99.99% Design, manufacture (Hongkong Co., Ltd. and sale of steel structures and spare parts for cranes The above subsidiaries have been consolidated into the Company s financial statements. (b Unconsolidated subsidiaries Attributable Country/year Registered equity Principal Name of incorporation capital interest activities Shanghai Zhenhua Changxin PRC/2001 5,000 thousand 70% Precision forge, Precision Forge Co., Ltd. metal incision and processing Shanghai Zhenhua Port PRC/2001 1,000 thousand 90% Design and sale Machinery Machine Design of port and Co., Ltd. other machinery Shanghai Zhenhua Port PRC/2001 1,000 thousand 90% Develop products Machinery New Products relating to port Development Co., Ltd. and other machinery Shanghai Zhenhua Port PRC/2001 1,000 thousand 99% Sale, installation Machinery Electronic Device and design of Co., Ltd. electrical devices ZPMC (M SDN. BHD. Malaysia/2002 MYR 100 thousand 100% Dormant (c Associate Percentage Country/year Amount of equity Principal Name of incorporation invested interest activities Shanghai Zhenhua PRC/ ,040 thousand 40% Delivery of products Shipping Co., Ltd. manufactured by the Company

199 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 31 SUBSIDIARIES, ASSOCIATES AND RELATED PARTIES (CONTINUED (d Related parties Name China Harbour Engineering (Group Company Hong Kong Zhenhua Engineering Co. Macau Zhenhua Engineering Co. Shanghai Port Machinery Factory Relationship with the Group Ultimate holding company which holds 31.26% of the Company s shares Subsidiary of the ultimate holding company which holds 18.71% of the Company s shares Subsidiary of the ultimate holding company which holds 0.36% of the Company s shares Subsidiary of the ultimate holding company and the Company s associate 32 RELATED PARTY TRANSACTIONS (a Freight paid to the associate Shanghai Zhenhua Shipping Co., Ltd. 236, ,423 (b Materials sold to the associate Shanghai Zhenhua Shipping Co., Ltd. 8,714 6,669 (c Interest paid to a related companies Shanghai Zhenhua Shipping Co., Ltd. - 3,789 - China Harbour Engineering (Group Company ,

200 SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2004 (All amounts are stated in Renminbi thousand Yuan unless otherwise stated 32 RELATED PARTY TRANSACTIONS (CONTINUED (d Amounts due to related companies 31 December December Shanghai Zhenhua Shipping Co., Ltd. 44,808 6,499 - Shanghai Zhenhua Changxin Precision Forge Co., Ltd. 1,773 2,168 46,581 8,667 (e Loan from a related company 31 December December China Harbour Engineering (Group Company - 10,000 The loan was unsecured and repaid in POST BALANCE SHEET EVENT According to the Board Resolution dated 27 January 2005, the Company will acquire 15% share of Shanghai Zhenhua shipping Co. Ltd. with a cash consideration of no more than 100 million. The Company has completed the acquisition with a consideration of 89.1 million as at 25 March After the acquisition, this associate becomes a consolidated subsidiary of the Company. According to the same Board Resolution, the Company will form with the Union Committee of Shanghai Zhenhua Port Machinery Co. Ltd. an joint venture engaged in manufacturing and leasing floating cranes. The Company will inject to this joint venture 51,000 thousand cash and hold 51% of its registered capital. As at the date of the authorization of these financial statements for issue, the Company has completed the cash injection and establishment of aforementioned Subsidiary. 34 RECONCILIATION OF NET ASSETS AT 31 DECEMBER 2004 AND NET PROFIT FOR THE YEAR THEN ENDED BETWEEN PRC REPORTING AND REPORTING UNDER INTERNATIOANL FINANICAL REPORTING STANDARDS ( IFRS The Company s net assets at 31 December 2004 and net profit for the year then ended under IFRS reporting are reconciled to those PRC reporting as below: Net profit for the year ended Net assets as of 31 December December 2004 Per PRC Reporting 456,908 3,465,997 Adjustment on amortisation of investment tax credit (29,482 (29,482 Per IFRS Reporting 427,426 3,436,

201 DOCUMENT CONTROL FORM Doc. Name : Doc. Locat : Operator : Input Date : Audit Group : Correction Checked Correction Checked Date by Date by Document type SHANGHAI ZHENHUA PORT MACHINERY CO., LTD. CONSOLIDATED FINANCIAL STATEMENTS 31 DECEMBER 2003 (B SHARE 1. CALL OVER Initials Sent to AWZ 1st 2nd Final Called over by to to to Additions checked by Cross referenced by Cross-checked to Chinese version by Proofread by (Manager 2. REVIEWED AND APPROVED FOR PRINTING BY Manager Partner 3. TO PRINTING ROOM Accounts Letterhead Auditors copy PWDH Tax copy PWASIA AGM copy Other Additional copy Total No. of pages Type of Binding Staple Plastic Required by: Date Time ***** This page is generated by the word processing ***** centre and is not part of the report