Shenzhen SEG Co., Ltd.
2016 Annual Report
2017-028
April 2017
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Chapter 1 Important Notice, Contents and Definitions
The Board of Directors, the Board of Supervisors, the directors, the supervisors and the
senior executives guarantee that the annual report is authentic, accurate, and complete, and
that it has no false records misleading statements or major omissions, and they commit to the
individual and joint legal liabilities.
Chairman of the Board of Directors Wang Li, the Chief Financial Officer Liu Zhijun and the
responsible person of the accounting institution (Accountant in charge) Ying Huadong
hereby declare that the Financial Statements enclosed in this annual report are true,
accurate and complete.
All the directors have attended this board meeting reviewing the annual report.
The future plans, development strategies, and forward-looking statements involved in the
annual report do not constitute any tangible commitment to investors. Investors should pay
attention to investment risks.
The Company plans not to distribute cash dividends or bonus shares nor transfer reserves
into share capital.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
CONTENTS
Chapter 1 Important Notice, Contents and Definitions ...........................................2
Chapter 2 Company Profile and Main Financial Indexes ........................................6
Chapter 3 Overview of Company’s Business ........................................................... 11
Chapter 4 Management Discussion and Analysis ...................................................17
Chapter 5 Important Matters ...................................................................................49
Chapter 6 Changes in Share Capital and Information on Shareholders ............ 109
Chapter 7 Preferred Shares..................................................................................... 115
Chapter 8 Information on Directors, Supervisors, Senior Executives and Employees
Chapter 9 Corporate Governance ..........................................................................128
Chapter 10 Corporate Bonds ..................................................................................143
Chapter 11 Financial Report ...................................................................................144
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Definitions
Definition Refers to Description
This Company, the Company, the listed
Refers to Shenzhen SEG Co., Ltd.
company, Shen SEG
Shenzhen SEG Group Co., Ltd. Refers to Shenzhen SEG Group Co., Ltd.
Huakong SEG Refers to Shenzhen Huakong SEG Co., Ltd.
SEG Baohua Refers to Shenzhen SEG Baohua Enterprise Development Co., Ltd.
Xi'an SEG Refers to Xi'an SEG Electronics Market Co., Ltd.
Suzhou SEG Refers to Suzhou SEG Electronics Market Management Co., Ltd.
Xi'an Hairong SEG Refers to Xi'an Hairong SEG Electronics Market Co., Ltd.
Nanjing SEG Refers to Shenzhen SEG Electronics Market Management Co., Ltd.
Shanghai SEG Electronics Market Operation Management Co.,
Shanghai SEG Refers to
Ltd.
Nantong SEG Refers to Nantong SEG Times Plaza Management Co., Ltd.
Changsha SEG Refers to Changsha SEG Development Co., Ltd.
Mellow Orange Hotel Refers to Shenzhen Mellow Orange Business Hotel Management Co., Ltd
Longgang SEG Refers to Shenzhen SEG Electronics Market Management Co., Ltd.
SEG Industry Refers to Shenzhen SEG Industrial Investment Co., Ltd.
SEG E-Commerce Refers to Shenzhen SEG E-commerce Co., Ltd.
SEG Credit Refers to Shenzhen SEG Credit Co., Ltd.
SEG Navigations Refers to Shenzhen SEG GPS Scientific Navigations Co., Ltd.
Shunde SEG Refers to Shunde SEG Electronics Market Management Co., Ltd.
Wuxi SEG Refers to Wuxi SEG Electronics Market Co., Ltd
Nanning SEG Refers to Nanning SEG Digital Plaza Management Co., Ltd.
Suzhou SEG Digital Refers to Suzhou SEG Digital Plaza Management Co., Ltd.
Xi'an Fengdong New Town SEG Times Plaza Properties Co.,
Xi'an Fengdong SEG Refers to
Ltd.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Definition Refers to Description
Nantong SEG Operation Refers to Nantong SEG Commercial Operation Management Co., Ltd.
SEG Intelligent Refers to Suzhou SEG Intelligent Technology Co., Ltd.
SEG Investment Refers to Shenzhen SEG Investment Management Co., Ltd.
SEG CPARK Refers to SEG International CPARK Show Promotion Center
Shenzhen SEG Longyan New Energy Application and
Longyan Application Refers to
Development Co., Ltd.
SEG Longyan Technology Refers to Shenzhen SEG Longyan Energy Technology Co., Ltd.
SEG Real Estate Investment Refers to Shenzhen SEG Real Estate Investment Co., Ltd.
SEG Kangle Refers to Shenzhen SEG Kangle Enterprise Development Co., Ltd.
SEG Property Development Refers to Shenzhen SEG Property Development Co., Ltd.
China International Consumer Electronics Exhibition/Exchange
CEEC Refers to
Center Co., Ltd.
Wangyu Technology Refers to Shanghai Wangyu Information Technology Co., Ltd.
SegMaker Refers to Shenzhen SegMaker Co., Ltd.
Tencent Refers to Shenzhen Tencent Computer System Co., Ltd.
Fujian Babycat Refers to Fujian Babycat Animation Technology Co., Ltd.
Tmall Company Refers to Zhejiang Tmall Technology Co., Ltd.
Futian Investment Refers to Shenzhen Futian Investment Co., Ltd.
Ourgame International Refers to Ourgame International Holdings Limited
Allied eSports Refers to Tianjin Allied eSports Internet Technology Co., Ltd.
Shum Yip Land Refers to Shum Yip Land Company Limited
State-owned Assets Supervision and Administration Commission
Shenzhen SASAC Refers to
of Shenzhen Municipality
CSRC Refers to China Securities Regulatory Commission
Shenzhen Securities Regulatory Bureau of China Securities
Shenzhen Securities Regulatory Bureau Refers to
Regulatory Commission
Articles of Association Refers to Articles of Association of Shenzhen SEG Co., Ltd.
Unless otherwise specified, the amount referred
Refers to Amount in RMB
to in the report
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Chapter 2 Company Profile and Main Financial Indexes
I. Basic Information
Stock abbreviation SHEN SEG, SHEN SEG B Stock code 000058, 200058
Changed stock abbreviation (if
None
any)
Listed on Shenzhen Stock Exchange
Company name in Chinese 深圳赛格股份有限公司
Company abbreviation in
深赛格
Chinese
Company name in English (if
SHENZHEN SEG CO., LTD.
any)
Company name abbreviations
None
in English (if any)
Legal representative Wang Li
Registered address 31/F, Tower A, Stars Plaza, Huaqiang Road (N), Futian District, Shenzhen
Post code
Office address 31/F, Tower A, Stars Plaza, Huaqiang Road (N), Futian District, Shenzhen
Post code
Website http://www.segcl.com.cn
E-mail segcl@segcl.com.cn
II. Contact Information
Secretary of the Board of Directors Securities affairs representative
Name Zheng Dan Zhang Xin
31/F, Tower A, Stars Plaza, Huaqiang Road 31/F, Tower A, Stars Plaza, Huaqiang Road
Contact address
(N), Futian District, Shenzhen (N), Futian District, Shenzhen
Phone 0755-83747939 0755-83747939
Fax 0755-83975237 0755-83975237
E-mail segcl@segcl.com.cn segcl@segcl.com.cn
III. Information Disclosure and Filing Site
Media selected by the Company for information China Securities Journal, Securities Times, Securities Daily and Hong Kong
disclosure Commercial Daily
Website assigned by CSRC for publishing the annual
http://www.cninfo.com.cn (Cninfo Website)
report
The place where the annual report is prepared and Secretary's Office of Board of Directors, 31/F, Tower A, Stars Plaza,
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
kept Huaqiang Road (N), Futian District, Shenzhen
IV. Changes of Registration Information
Organization code 27925377-6
Changes to business scope on July 6, 2005: Domestic commerce, goods supply and
sale (excluding commodities under special operation, control and sale), industrial
investment (licenses for specific projects shall be subject to application on a
case-by-case basis), economic information consultancy, property lease, real estate
agency, and operation of SEG professional electronics markets (the license for the
professional market shall be further applied for).
Alteration of registration information on September 28, 2016: The business scope of
the Company is changed to investment in industrial projects (specific items to be
declared separately); operation and management of electronics markets; online trade;
Internet technology development; advertising business; housing leasing; sales of
computers, software, auxiliary equipment, and electronic products; cultural and artistic
exchange activity planning (excluding performances); exhibition activities; investment
in and management of children's industrial chain projects; children's playground
Changes of main business since the
equipment leasing (excluding financial leasing activities); playground management and
Company's listing (if any)
services (limited to branch management); catering services (limited to branch
management); business management consulting; education consulting; wholesale and
retail of pre-packaged food, unpacked food, and dairy products (including infant
formula milk powder) (limited to branch management); sales of stationery, craft gifts,
toys, children's clothing, electronic products, handicrafts, and daily necessities;
photography services; technical development of new energy; EPC of photovoltaic
power generation and building integrated photovoltaic (BIPV) engineering; technical
development and services of CdTe film solar cell modules; investment in photovoltaic
power plants, contracting of BIPV curtain wall engineering; domestic trade (excluding
franchised goods, proprietary goods, and goods under special control). (Any item
subject to approval pursuant to laws can be operated only after approval.) Information
services (limited to Internet information services); sales of food; manufacturing and
sales of CdTe solar cell modules.
Changes of dominant stockholders (if any) No change.
V. Other Relevant Information of the Company
The accounting firm employed by the Company:
Name of the accounting firm Da Hua Certified Public Accountants (Special General Partnership)
Address of the accounting firm Room 1101, 11/F, Tower 7, No. 16 Block, Xisihuan Road (M), Haidian District, Beijing
Name of the certified public
Zhang Xing and Zhang Zhaocheng
accountant signing the audit report
The sponsor firm employed by the Company for fulfilling the duties of continuous supervision in the report
period:
□ Applicable √ Not applicable
The financial advisor employed by the Company for fulfilling the duties of continuous supervision in the report
period:
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
□ Applicable √ Not applicable
VI. Main Accounting Data and Financial Indexes
Are retrospective adjustments made by the Company to previous financial statements due to accounting policy
changes or accounting errors?
□ Yes √ No
Year-on-year
2016 2015
increase/decrease
Operating income (Yuan) 672,384,276.47 741,533,676.93 -9.33% 681,343,920.99
Net profit attributable to shareholders of
107,560,213.41 74,242,090.49 44.88% 48,380,294.05
the listed company (Yuan)
Net profit attributable to shareholders of
the listed company after deduction of 29,705,359.63 84,931,560.68 -65.02% 45,920,252.23
non-recurring gains and losses (Yuan)
Net cash flow arising from operating
-120,030,057.68 -12,453,523.82 -427,933,620.94
activities (Yuan)
Basic EPS (Yuan/Share) 0.1371 0.0946 44.93% 0.0616
Diluted EPS (Yuan/Share) 0.1371 0.0946 44.93% 0.0616
Weighted average ROE 7.11% 5.19% 1.92% 3.80%
Year-on-year
End of 2016 End of 2015 End of 2014
increase/decrease
Total assets (Yuan) 2,548,276,265.32 2,614,660,524.37 -2.54% 2,659,717,718.28
Net assets attributable to shareholders of
1,548,200,647.55 1,475,126,229.16 4.95% 1,298,970,719.85
the listed company (Yuan)
VII. Differences in Accounting Data under Chinese and Overseas Accounting Standards
1. Differences in net profits and net assets reported in the financial statements disclosed under
international accounting standards and Chinese accounting standards
□ Applicable √ Not applicable
In the report period, the company's net profits and net assets have no differences in the financial report disclosed
based on both the international and the Chinese accounting standards.
2. Differences in net profits and net assets reported in the financial statements disclosed under
international accounting standards and Chinese accounting standards
□ Applicable √ Not applicable
In the report period, the company's net profits and net assets have no differences in the financial report disclosed
based on both the international and the Chinese accounting standards.
VIII. Major Quarterly Financial Indexes
Unit: Yuan
Quarter 1 Quarter 2 Quarter 3 Quarter 4
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Operating income 191,126,945.65 171,546,291.20 139,478,273.85 170,232,765.77
Net profit attributable to shareholders of the
17,696,110.04 9,160,160.38 15,422,191.47 65,281,751.52
listed company
Net profit attributable to shareholders of the
listed company after deduction of 17,623,939.70 11,072,519.77 15,912,414.05 -14,903,513.89
non-recurring gains and losses
Net cash flow from operating activities -30,744,760.42 -68,569,267.98 15,886,231.75 -36,602,261.03
Are there any significant differences between the financial indexes or their totals in the preceding table and those
described in the disclosed quarterly reports or semi-annual reports?
□ Yes √ No
IX. Items and amount of non-recurring gains and losses:
√ Applicable □ Not applicable
Unit: Yuan
Amount of Amount of Amount of
Item Remarks
2016 2015
Gains on reduction of holding-shares of
Gains and losses on disposal of
Huakong SEG, sales of the equity of
non-current assets (including the write-off 89,459,793.78 -257,269.63 6,475.34
SEG E-commerce, and disposal of fixed
of assets depreciation reserves)
assets
Subsidies for Nantong SEG animation
industrial base, 2015 special funds for
development of the service industry of
Wujiang District from Finance Bureau of
Wujiang District, Suzhou, special funds
for industrial development from
Government subsidies recorded into
Administrative Committee of the
current gains and losses (except those
Economic Development Zone, 2015
closely related with corporate business 9,828,264.76 980,956.24 1,554,585.78
Reward for stable and healthy economic
and enjoyed according to national
development, headquarter operation
standards or certain quota)
reward of special funds for industrial
development of Enterprise Development
Service Center, Futian District,
Shenzhen, and support project fund for
construction of Nantong SEG
Electronics Market
Fund appropriation charges for
non-financial entities recognized in 3,097,500.00 3,414,955.63 700,000.00
current profit or loss
Corporate restructuring costs, such as Employee compensation arising from
-1,439,958.00
staffing expenses and integration costs restructuring of SEG E-commerce
Transferred-back impairment provision
for accounts receivable, for which 469,871.93
separate impairment tests are carried out
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Amount of Amount of Amount of
Item Remarks
2016 2015
Trustee fee from entrusted operation 188,679.24 200,000.00 200,000.00
Other non-operating income and expenses Losses from litigation compensation of
-3,068,241.76 -13,043,897.59 498,440.96
except the above-mentioned items Nanning SEG
Less: Amount of affected income tax 19,072,980.69 2,022,052.01 216,991.94
Amount of influence of minority
1,138,203.55 432,034.76 282,468.32
shareholders' equity (after tax)
Total 77,854,853.78 -10,689,470.19 2,460,041.82 --
An explanation shall be made with regard to the Company's considerations for defining non-recurring profit and
loss according to the Explanatory Announcement No.1 on Information Disclosure for Companies Offering Their
Securities to the Public - Non-recurring Profit and Loss and the reason of classifying the non-recurring profit
and loss listed in this announcement as recurring.
□ Applicable √ Not applicable
In the report period, it does not happen that the company defines the non-recurring profit and loss items defined
or listed by Interpretive Bulletin No. 1 on Information Disclosure by Companies Publicly Issuing Securities -
Non-recurring Gains and Losses as recurring profit and loss items.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Chapter 3 Overview of Company’s Business
I. Main Business in the Report period
Should the Company abide by the disclosure requirements of special industries?
No.
(I) Main business and operation model
Main business of the Company includes development and operation of electronics market and supporting
projects, property lease service, trade and channel service, e-commerce, value-added microcredit service, and
economical hotel service and so on.
Business model: With three business operation platforms including the electronics market, commercial real
estate and SEG CPARK as the core, the Company comprehensively integrates business resources, promotes the
transformation and upgrading of the original main business, expands the business from operation of a single
business platform to the production and operation of relevant content, creates a business model combining
multiple business types, including maker ecology, culture and education, intelligent technology, sports and
entertainment, virtual experience, e-sports, and financial services and so on, and develops from a single leasing
role into diversified strategic emerging industries and high-end manufacturing and services.
(II) Current situation and tendency of industrial development and industrial position of the Company
1. Current situation of development of the electronics market is as follows:
① The industrial value chain of the electronics market is extended and the market functions are diversified.
With the improvement of modernized communication technology and information transmission approaches, the
cost for connecting transaction information between consumers and manufacturers decreases gradually, and the
functions of the electronics market in commodity gathering, distribution and transactions are being weakened. At
present, the electronics market has abandoned the earliest \"vendor booth\" model of operation, and is extending
vertically toward the two ends of the value chain of the electronic information industry, from only serving the
distributors to providing services in enterprise image and product image display and promotion to manufacturers,
providing sales service to distributors and providing platform comprehensive services to consumers before,
during and after sales.
Extension of the Industrial Value Chain of the Electronics Market
Manufacturer:
enterprise image Distributor: Consumers:
and product image product sales services before,
display and service during and after
promotion service sales
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
At the same time, in the electronics market, facilities including water, electricity, warehousing, transportation,
packaging, security, fire control, health, settlement, information, and life services have been improved. The
functions of the electronics market have changed from traditionally unitary commodity gathering, distribution
and transaction to commodity gathering and distribution, information release, price discovery and
comprehensive services.
② Tendency of industrial integration is intensified.
Faced with the industrial reform, in order to strengthen the competitiveness, the electronics market has formed
modern integrated logistics and services that are mainly represented by overseas transportation and bonded
warehousing, foreign trade, agency sales and property leasing. Whereas the traditional electronics market has
such weaknesses as high property cost, high transportation pressure and insufficient logistics supporting
infrastructures, the new generation electronics market focuses on innovation in the traditional operation model,
provides various services to both buyers and sellers, creates advanced distribution center for electronic
components and IT terminal products, strengthens logistics service, develops service trade for electronic
manufacture industry, and builds a distribution operation center of electronic products integrating property
leasing and service, logistics and distribution, information and financial services.
③ Intelligent terminal products, especially 3C products including mobile phones and tablet devices become
main operating products.
Technical improvements brought by mobile Internet technology and touch technology have facilitated the
migration of intelligent devices from desk devices to mobile devices, represented mainly by smart phones and
tablet computers. With the construction of mobile Internet infrastructure and development and improvement of
the Internet ecological system including software and hardware, the consumption market of smart phones and
tablet computers has been fast developing. Intelligent terminal devices have gradually become the main
operating products in the electronics market, and will further facilitate the development of the latter.
④ Tendency of products expanding to emerging application fields is intensified.
In recent years, with the fast development of industries including wearable devices, intelligent household and
automotive electronics, types of products distributed in the electronics market gradually expand to the emerging
application field, meanwhile the booming development of the emerging market of electronic information
industry will strongly drive the increase of demands for electronic components.
⑤ Reform occurs in commercial property management of electronics market.
Operation of commercial properties refers to the industry that acquires long-term rental income and supporting
service income by leasing properties or providing management services. The property industry in China is
developing, improving and getting mature. As improvement of management and service concepts is advocated
now, competition of quality concept and brand concept, changes of market environment, application of high and
new technologies and updating of consumption ideas request the property operation enterprises to make relevant
reform from service concepts to service methods, from operation concepts to market positioning. Therefore, the
commercial operation of the electronics market will gradually develop from the previously traditional electronic
product transaction platform and leasing platform to diversified businesses including comprehensive maker
business, culture and education, intelligent technology, sports and entertainment, virtual experience, e-sports and
financial services.
⑥ Influences from e-commerce on operation and management of physical markets
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
In recent years, the transaction volumes and the number of markets and booths in electronics markets with the
sales volume exceeding RMB 100 million have decreased mainly due to the influence from e-commerce on
physical markets. As the promotion of mobile terminal consumption, household consumption and all kinds of
life services are overheating in the online market. Therefore, it is imperative for electronics markets to transform
to both online and offline platforms operation model.
2. Analysis on industrial development tendency of nationwide electronics markets
Electronics markets play an important role in the circulation of IT products. The booming electronic information
industry has brought a huge space for growth. With the fast development of e-commerce, network devices and
logistics industry in China in recent years, physical electronics markets have been affected to a certain extent,
traditional electronics markets are facing both the opportunity and the challenge of transformation and upgrading.
During the \"13th Five-year Plan\" period, the electronics markets in China will develop in the following
tendencies:
① Electronics markets will focus on both physical markets and e-commerce
At present, e-commerce economy under Internet has entered into a new normal state. The slow-down of growth
has triggered the reform of channel relationship. However, because the physical electronics markets feature
production operation, supply logistics service and realistic consumption experience that are different from
e-commerce, the latter has gradually carried out cooperation with electronics markets, as an inevitable tendency
of the development of the industry.
② Integrated and interactive development of electronics markets and commercial real estate
In recent years, the profit model of electronics markets is changing. On one hand, electronics markets are
combined with commercial real estate. Through total packaging, operation and promotion of commercial real
estate, the formation of IT business circle is accelerated, and the real estate projects where the electronics
markets are located increase in value. On the other hand, the appreciation of real estate where the electronics
markets are located will further improve the brand value of the electronics markets. Therefore, more and more
merchants praise highly of the operation model of interactive development by utilizing electronics markets to
increase the value of the surrounding properties, further driving the development of the electronics markets.
The integrated and interactive development of electronics markets and commercial real estate can ensure the
long-term stable operation of the markets, and electronics markets can directly benefit from the income from real
estate appreciation brought by market operation, which facilitates the expansion of enterprises and the growth of
brands.
③ Electronics markets are facing upgrading and renovation and manufacturers of famous electronic brand are
seeking for joint development with electronics markets.
The popularization of consumable electronic products has made the electronics markets the buyer's market. The
consumers have higher requirements on the shopping environment, quality warranty and after-sale guarantee.
The operators of the electronics markets must continuously improve internal management, service, and shopping
environment, normalize the merchants' operation behaviors, and improve after-sale service guarantee system to
attract more consumers.
At the same time, the intensified competition among manufacturers of famous electronic brands will further
strengthen the integration. The control of the manufacturers over the downstream fields will be strengthened, and
they will continuously adjust agencies and the distributors, which will affect the adjustment of the electronics
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
markets. At present, the electronics markets focus more and more on of manufacturer resources. By various
approaches including expanding market scale, improving shopping environment and improving service standard,
the markets focus on improving the popularity and brand influences of the market brands in the mind of the
consumers, so as to get more resources of manufacturer resources.
④ Electronics markets will remain the dominant sales channel of IT products in China.
Domestic channels of retail market of electronic products mainly include electronics markets, chain stores of
electrical household appliances, retailers with own properties, e-commerce and department stores and
supermarkets. Most retailers of electronic products carry out operation and sales in the electronics market, which
maintains large market shares by relying on such advantages as the most complete categories of products, fast
updating, large operation area and comfortable shopping environment. The retailers have chosen electronics
markets with brand popularity as their main platform for operation in order to improve the sales and coverage
width to consumers and improve the sales efficiency.
On the other hand, the electronics market is also the main product display platform for many manufacturers of
electronic products. By setting up flagship stores or experience stores in the electronics markets, manufacturers
can help consumers timely and easily know about their latest products, and display the enterprise image.
According to the investigation data from Electronics Market Committee of China Electronics Chamber of
Commerce, the electronics market will remain the main sales channel for domestic electronic products in the
future. The percentage of sales volume of electronic products including desktops, laptops, mobile phones, tablet
computers and intelligent hardware sold through electronics markets in the total domestic retail volume will
remain over 50%.
3. Industrial position of the Company
In terms of operation of electronics markets, as the founder of the electronics market operation model of China,
the Company is leading in the industry. The Company has established nearly 30 electronics markets in China by
means of direct operation, joint operation and entrusted operation, has formed a chain system of electronics
markets covering Pearl River Delta, Yangtze River Delta and radiating the whole country, and has gained high
brand influence both at home and abroad.
II. Significant Changes in Main Assets
1. Significant Changes in Main Assets
Main assets Description of Significant Changes
In the report period, the equity decreases by 0.80% year on year, mainly because
(1) In the report period, the Company reduced 10,066,700 holding-shares of Huakong
SEG and the long-term equity investment of RMB 9,086,600.
(2) In the report period, the Company contributed RMB 9,000,000 to Shenzhen
International Consumer Electronics Exchange/Exhibition Center Co., Ltd. (CEEC),
Equity
accounting for 30% of its equity.
(3) In the report period, Huakong SEG and Shanghai SEG make profits but CEEC makes
a loss based on accounting via the equity method. After the Company deducts cash
dividents of Shanghai SEG,, the Company reduced the long-term equity investment of
RMB 387,100 in total
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Fixed assets There is no significant change in the report period.
Intangible assets There is no significant change in the report period.
In the report period, the LCD screen installation project in the lobby of 1/F of SEG Plaza
Construction in progress
was completed and transferred out, resulting in decrease of this item.
In the report period, the monetary fund decreases by 33.87% year on year, mainly
Monetary fund because the Company's funds were mainly used to invest in Nantong SEG Times Plaza,
resulting in decrease of this item.
In the report period, accounts receivable decrease by 48.20% year on year, mainly
because the Company sold the equity of its subsidiary SEG E-Commerce and the balance
Accounts receivable
sheet statement of SEG E-Commerce was no longer consolidated, resulting in decrease
of this item.
In the report period, the prepayment decreases by 63.28% year on year, mainly because
the Company sold the equity of its subsidiary SEG E-Commerce and the balance sheet
Prepayment
statement of SEG E-Commerce was no longer consolidated, resulting in decrease of this
item.
In the report period, other receivables increase by 131.00% year on year, mainly because
(1) The subsidiary SEG Baohua paid the decoration deposit RMB 8,980,000 for the new
Dongmen Branch of Mellow Orange Hotel.
(2) The headquarters paid the earlier-stage deposit RMB 1,030,000 in total for new
Other receivables
projects.
(3) The incomings and outgoings of the subsidiary Wuxi SEG with Wuxing Xinyuan
Construction Development Co., Ltd. increased by RMB 10,300,000 in total.
(4) The purchasing deposit of SEG Intelligent increased by RMB 2,000,000.
In the report period, the inventory increases by 33.56% year on year, mainly because
Inventory project construction expenditure was incurred by Nantong SEG Times Plaza, resulting in
increase of this item.
In the report period, the long-term deferred expense increases by 91.57% year on year,
Long-term deferred expense mainly because the decoration expense of Nantong SEG Times Plaza RMB 42,970,000
was incurred.
In the report period, other non-current assets increase by 170.48% year on year, mainly
Other non-current assets because the earlier-stage expenditure of the new branch of Mellow Orange Hotel RMB
7,460,000 was incurred.
2. Main Overseas Assets
□ Applicable √ Not applicable
III. Analysis of Core Competence
Shenzhen SEG Electronics Market operated by the Company is the founder of the electronics market operation
model in China, as a leader in the industry. It has won honorable titles successively including \"Five-star Market
of Electronic Products in China\", \"Most Influential Market in Shenzhen Special Economic Zone in 30 Years\",
\"National Integrity Demonstrative Market 2014-2015\" awarded by the State Administration for Industry &
Commerce, and ten branded markets in Shenzhen for \"Influencing China\".
Through 28 years of hard work in the electronics market, the Company has acquired abundant market merchant
resources and mature market operation and management experience. As of today, the Company has set up more
than 20 electronics markets in China by means of direct operation, joint operation and entrusted operation, has
formed a chain system of electronics markets covering the Zhujiang River Delta, the Yangtze River Delta and
radiating the whole country, and has become the largest comprehensive electronics market in China and even in
Asia covering electronic components, digital IT and communication products, and has gained high brand
influence both at home and abroad.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
For the past several years, the Company has been carrying out exploration, innovation and practice in terms of
business transformation and upgrading of electronics markets for traditional main business. Faced with new
consumption, new channel and new retail, apart from updating hardware and upgrading services, SEG
Electronics Market has continuously introduced scene-mode, experience-mode, interaction-mode and
socializing-mode types of operation. In the fields where SEG has investment and resources integration capacity,
in order to improve core competitiveness and initiatives, SEG has attempted to create diversified types of
business with SEG characteristics by means of investment and joint venture, such as juvenile maker education,
e-sports, intelligent home and children's experience, etc. After the said featured types of business are gradually
formed, an offline shopping place featuring SEG Electronics (digital and communication) as the core, coexisting
of SEG's featured types of business, and other featuring cooperative types of business will come into being and
provide one-stop and comprehensive consumption experience to consumers.
In the report period, the Company has actively carried out major assets restructuring, reduce horizontal
competition at the maximum and enhance the profitability and core competitiveness of listed company. At the
same time, relying on the platform of the listed company, the Company has fully integrated the business of
electronics markets, and eventually fulfilled strategic integration, transformation and upgrading of current
business of the listed company. In the report period, the Company's scheme of major assets restructuring was
conditionally approved by China Securities Regulatory Commission Acquisition and Restructuring Committee.
After the completion of major assets restructuring, the Company will continuously integrate the existing business
and resources, develop in-depth cooperation with Longyan Energy Technology, Wangyu Technology, Alibaba,
Fujian Babycat, and Tencent in such new business fields as new energy, e-sports, e-commerce, animation, and
makers, actively promote the transformation and upgrading of the original business, develop new business, and
achieve coordinated development of multiple business types. The Company will develop diversified strategic
emerging industries and high-end manufacturing and services.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Chapter 4 Management Discussion and Analysis
I. Overview
In the report period, the global economy, affected by such events as slow-down of economic growth in USA and
Brexit, is in downturn of growth. Affected by complicated and severe international and domestic environment,
the economic growth and transformation of China is still under the downturn pressure.
Facing the complicated external economic environment and fierce market competition, the Company has
actively promoted major assets restructuring in 2016. In this way, the Company has acquired such core operating
assets held by the controlling shareholders as the quality electronics market, property management, and
commercial real estate, which will enhance and stabilize the operating results of the Company. The income from
investment in the real estate development project in the major assets restructuring will also enhance the
profitability of the Company. The Company has also strengthened efforts on resource integration, transformation
and upgrading through the major assets restructuring, vigorously developed innovative business, and looked for
new profit growth point to constantly enhance the core competitiveness of the Company.
In the report period, the Company achieved the operating income of RMB 760,910,000, decreasing by 10% year
on year. The main reasons of decrease are: (1) the operating income from electronics market and property lease
plates declined; (2) due to the program of replacing business tax with value-added tax, the total income of the
Company decreased by around RMB 19,000,000; and (3) the operating income of microcredit business
decreased.
In the report period, the Company achieved total profit as much as RMB 187,540,000, increasing by 31.08%
year on year. The main reason for the increase is: the investment income of the Company from sales of the equity
of Huakong SEG and SEG E-commerce.
II. Analysis of Main Business
1. Overview
The main business of the Company comprises development and operation of electronics markets and supporting
projects, property lease service, trade and channel operation, microcredit value-added service, and economical
hotel business.
(1) Operation of electronics markets (including relevant business such as maker platform and Internet +)
With the fast development of Internet and mobile Internet, fast popularization of terminal operation, the
formation of oligopoly of e-commerce platforms as well as the vertical subdivision of e-commerce market, the
electronics market has been impacted to a certain extent.
Facing heated market competition and the impact of new commerce modes, by focusing on users' value and
integrating all kinds of resources, expanding the industrial chain, enriching value-added services, improving the
service quality, and establishing multi-channel profit model, the Company has greatly promoted the
transformation and upgrading of the existing electronics market business, actively explored new business
development modes and continuously improved the operation capacity and the innovation capacity of the main
electronics markets.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
In the report period, the Company carried out strategic business cooperation with Taobao, established online and
offline business platform, has made a solid first step on the path of creating O2O electronics market innovation
and value-added services with SEG features. By carrying out strategic business cooperation with Allied eSports,
Wangyu Technology and Fujian Babycat, the Company has gradually set foot in production and operation of
relevant contents from unitary commercial platform operation, and created comprehensive platform service
operator. The Company has signed a strategic cooperation agreement with Tencent to use respective platform
and resources advantages for strategic cooperation, jointly create a comprehensive service platform for makers
that combines incubation and investment, key cooperative physical display and distribution platform for
hardware and hardware lab platform of pragmatic innovation service, and establishes a maker incubation service
benchmark combining software and hardware in China. The Company has signed a strategic cooperation
agreement with Tmall. The parties will carry out strategic cooperation in terms of target recommendation of
maker products or mature products, maker support event of \"global gathering and innovation\", Internet
intelligent acceleration channel, online and offline marketing events, media promotion and resources
complementation. SEG CPARK affiliated to SEG has attracted many international and domestic famous brands
and creative products from makers to enter. It has gathered more than 500 models of branded products, and held
more than 130 road shows, academic exchange and products release. It has been highly recognized by leaders at
all levels and achieved extensive influence and good social demonstrative effects. SEG CPARK obtained the
special fund of RMB 2,000,000 for makers in Shenzhen in August 2016, and has recently been awarded the title
as a \"Base for Science Education\" by Shenzhen Science and Technology Association.
In the report period, the Company's electronics market business achieved operating income of RMB 281,600,000,
decreasing by 19.59% year on year; and achieved total profit of RMB 46,470,000, decreasing by 33.67% year on
year. The operating income and total profit decreased because: on the one hand, the psychical store industry is
impacted by economic slowdown and fast development of mobile Internet and e-commerce in China; on the
other hand, the Company has vigorously promoted diversification, transformation, and upgrading of market
operations, retains the original well-managed business types, brings in different strategic industries, and
coordinates different business type combinations to enhance the core competitiveness of the Company. The
investment in such strategy has an impact on decline in the annual revenue of the Company.
(2) Property lease service business
The Company's property lease service includes the property lease business of the head office, the subsidiary SEG
Baohua held by the Company and Nantong SEG operating company. In the report period, the performance of the
property lease business of the head office and subsidiary SEG Baohua held by the Company has been relatively
stable.
The Company has maintained the all-year-round lease rate above 98% by effective operation measures such as
improving management and service quality of properties, controlling costs and expenses and adjusting strategies
to attract investment. In the report period, the Company's property lease service achieved the operating income
of RMB 61,680,000, decreasing by 5% year on year; and achieved the total profit of RMB 19,790,000,
decreasing by 17% year on year. The main reasons for decrease of operating income and total profit are: firstly,
affected by the overall economic environment, in order to maintain the stability of property operation and give
merchants confidence in operation, the Company lowered down the rents of some properties; secondly, Nantong
SEG Times Plaza Commercial Project was opened at the end of October 2016. The investment and relevant costs
in the earlier stage were incorporated into the property lease business, resulting in decrease of total profit.
(3) Trade and channel business
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
In the report period, the overall operation of SEG Industry declined sharply, mainly due to increasing economic
downturn pressure in China, and business stagnation of upstream and downstream partners, which resulted in
delayed capital return and slow capital circulation of cooperating customers of SEG Industry, and directly
affected the operating income of the Company. At the moment the Company has filed lawsuits against the
cooperating customers that delayed the payment for goods and taken relevant legal measures to protect the
interests of the Company. SEG Intelligent Company was invested and established by the Company in January
2016. It engages in smart home business, develops intelligent and engineering projects, and provides multiple
intelligent solutions for home, engineering, and plants. SEG Intelligent also acts as agent for retail of famous
brands of communications.
In the report period, the Company's trade and channel business achieved the operating income of RMB
284,330,000, increasing by 7.58% year on year. The main reason for increase of operating income is the income
from channel business of SEG Intelligent Company added in the report period.
(4) Microcredit business
In the report period, SEG Credit, the subsidiary held by the Company was stable in operation. The Company's
cargo pledge business is getting more and more mature. In order to adapt to the market changes and the demands
of the customers, the Company has continuously explored new models of loan. Under the precondition of risk
control, the Company has attempted to carry out dynamic cargo pledge operation model and has achieved initial
success.
In the report period, the Company's microcredit business achieved the operating income of RMB 88,530,000,
decreasing by 15% year on year; and achieved the total profit of RMB 42,270,000, decreasing by 10% year on
year. The main reasons for decrease of operating income and total profit are as follows. On one hand, the
competition of microcredit industry has been intensified in 2016 according to the industrial statistical data. The
overall operation performance has declined. Moreover, a large number of guarantee companies and commercial
banks have got involved in the microcredit industry, which affected the income of the microcredit companies.
On the other hand, affected by the decrease of entire interest rates of China, the overall income level of the
Company has decreased slightly.
(5) Economical hotel business
In the report period, SEG Baohua opened a new economical hotel in Luohu District, Shenzhen (Mellow Orange
Dongmen Branch), and its previous economical hotel business included Changsha Branch, Xingsha Branch and
Bao'an Branch. In the report period, the Company's economical hotel business achieved the operating income of
RMB 24,920,000, decreasing by 6% year on year; and achieved the total profit of RMB 2,050,000, decreasing by
1.5% year on year. The main reasons for the decrease of operating income and total profit are: firstly, they are
affected by the external economic environment, and the competition of the economical hotel industry has been
intensified; secondly, affected by the program of replacing business tax with value-added tax as well as the new
opening of Dongmen Hotel, the operating income has decreased slightly.
(6) E-commerce business
In the report period, the Company's e-commerce business achieved the operating income of RMB 19,860,000,
decreasing by 44.19% year on year. The main reason for decrease of operating income is that in the report period
the Company implemented the transfer of SEG E-commerce, and SEG E-commerce scaled back all its
operations.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
2. Income and Cost
(1) Formation of operating income
Unit: Yuan
2016 2015 Year-on-year
Percentage of Percentage of increase/decrease
Amount Amount
operating income operating income (%)
Total operating
760,915,085.86 100% 846,675,884.33 100% -10.13%
income
Classified by industry
Electronics market
operation and 343,280,375.05 45.11% 415,127,517.70 49.03% -17.31%
property leasing
Trade 284,331,867.85 37.37% 264,303,143.71 31.22% 7.58%
Hotel 24,915,964.23 3.27% 26,523,482.58 3.13% -6.06%
E-commerce 19,856,069.34 2.61% 35,579,532.94 4.20% -44.19%
Finance 88,530,809.39 11.63% 105,142,207.40 12.42% -15.80%
Classified by product
Classified by region
Shenzhen 463,882,693.06 60.96% 625,255,412.68 82.17% -25.81%
Xi'an 61,087,396.36 8.03% 59,688,953.13 7.84% 2.34%
Su Zhou 177,711,494.88 23.35% 79,040,494.44 10.39% 124.84%
Changsha 24,597,175.67 3.23% 39,091,884.16 5.14% -37.08%
Nanjing 24,795,038.43 3.26% 32,421,829.58 4.26% -23.52%
Foshan 3,020,405.16 0.40% 2,474,556.31 0.33% 22.06%
Wuxi 5,820,882.30 0.76% 7,079,142.74 0.93% -17.77%
(2) Information on industries, products or regions accounting for over 10% of operating income or
operating profit
√ Applicable □ Not applicable
Should the Company abide by the disclosure requirements of special industries?
No.
Unit: Yuan
Year-on-year Year-on-year
Year-on-year
increase/decrease increase/decrease
Operating income Operating cost Gross profit rate increase/decrease
of operating of gross profit
of operating cost
income rate
Classified by industry
Electronics 343,280,375.05 243,760,551.06 28.99% -17.31% -19.15% 1.62%
market operation
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
and property
leasing
Trade 284,331,867.85 284,740,411.64 -0.14% 7.58% 9.19% -1.48%
Hotel 24,915,964.23 21,705,084.88 12.89% -6.06% -2.47% -3.20%
(3). E-commerce 19,856,069.34 19,858,461.31 -0.01% -44.19% -20.53% -29.77%
Finance 88,530,809.39 12,430,171.06 85.96% -15.80% 45.67% -5.92%
Classified by product
Classified by region
Shenzhen 463,882,693.06 322,380,893.92 30.50% -25.81% -23.88% -1.76%
Xi'an 61,087,396.36 44,494,862.35 27.16% 2.34% 2.34% 0.00%
Su Zhou 177,711,494.88 163,336,457.22 8.09% 124.84% 116.24% 3.66%
Changsha 24,597,175.67 15,356,162.14 37.57% -37.08% -44.53% 8.39%
Nanjing 24,795,038.43 29,081,888.23 -17.29% -23.52% -14.14% -12.81%
Wuxi 3,020,405.16 2,873,099.31 4.88% 22.06% 24.16% -1.61%
If the statistical caliber of main business data is adjusted in the report period, the Company shall use the main
business data of the previous year collected at the end of the report period after adjustment of statistical caliber.
□ Applicable √ Not applicable
(3) Is the Company's material sales revenue more than its service revenue?
□ Yes √ No
(4) Performance of executed major sales contracts as of the report period
□ Applicable √ Not applicable
(5) Formation of operating cost
Industry classification
Unit: Yuan
2016 2015 Year-on-year
Industry
Item Percentage of Percentage of increase/decrease
classification Amount Amount
operating cost operating cost (%)
Electronics Electronics
market operation market operation
41.85% 301,511,104.70 48.78% -19.15%
and property and property 243,760,551.06
leasing leasing
Trade Trade 284,740,411.64 49.22% 260,773,559.46 42.19% 9.19%
Hotel Hotel 21,705,084.88 3.75% 22,255,148.18 3.60% -2.47%
E-commerce E-commerce 19,858,461.31 3.43% 24,989,821.48 4.04% -20.53%
Finance Finance 12,430,171.06 2.15% 8,533,082.37 1.38% 45.67%
Industry Item 2016 2015 Year-on-year
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
classification Percentage of Percentage of increase/decrease
Amount Amount
operating cost operating cost (%)
Electronics
market operation Lease and
89,787,034.41 36.83% 99,519,264.28 33.01% -9.78%
and property property costs
leasing
Electronics
Total
market operation
remuneration for 57,842,140.82 24.12% 73,123,516.29 24.25% -20.90%
and property
employees
leasing
Electronics
market operation Depreciation and
26,896,131.93 11.22% 29,266,499.62 9.71% -8.10%
and property amortization
leasing
Electronics
Market and
market operation
property service 59,910,715.55 24.99% 75,217,006.81 24.95% -20.35%
and property
costs
leasing
Electronics
market operation Retail goods sales
9,324,528.35 3.89% 24,384,817.70 8.09% -61.76%
and property cost
leasing
2016 2015 Year-on-year
Industry
Item Percentage of Percentage of increase/decrease
classification Amount Amount
operating cost operating cost (%)
Total
Hotel remuneration for 5,110,635.15 23.55% 5,458,034.64 24.52% -6.36%
employees
Depreciation and
Hotel 3,243,021.27 14.94% 3,577,343.55 16.07% -9.35%
amortization
Hotel Administrative fee 202,279.31 0.93% 597,774.92 2.69% -66.16%
Hotel Lease cost 8,258,888.25 38.05% 8,199,833.24 36.84% 0.72%
Hotel Others 4,890,260.90 22.53% 4,422,161.83 19.87% 10.59%
2016 2015 Year-on-year
Product category Item Percentage of Percentage of increase/decrease
Amount Amount (%)
operating cost operating cost
Trade Goods sales cost 262,813,004.51 92.30% 260,773,559.46 100.00% 0.78%
Trade Lease cost 4,060,000.00 1.43%
Trade Manpower cost 984,567.12 0.35%
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Trade Others 16,882,840.01 5.93%
2016 2015 Year-on-year
Industry
Item Percentage of Percentage of increase/decrease
classification Amount Amount
operating cost operating cost (%)
Finance Lease cost 835,447.71 6.72% 664,432.82 7.79% 25.74%
Financial service
Finance 11,594,723.35 93.28% 7,868,649.55 92.21% 47.35%
cost
2016 2015 Year-on-year
Industry
Item Percentage of Percentage of increase/decrease
classification Amount Amount
operating cost operating cost (%)
Total
E-commerce remuneration for 791,042.52 3.98% 1,248,958.81 5.00% -36.66%
employees
E-commerce Sales cost 14,803,990.32 74.55% 16,457,203.37 65.86% -10.05%
Promotion
E-commerce 2,201,214.57 11.08% 2,562,768.35 10.26% -14.11%
expenses
Customs
E-commerce declaration and 1,411,072.73 7.11% 2,058,226.13 8.24% -31.44%
logistics expenses
E-commerce Others 651,141.17 3.28% 2,662,664.82 10.65% -75.55%
(6) Is the consolidation scope changed in the report period?
√ Yes □ No
Compared with the previous period, three more entities are included in and one entity is excluded from the
consolidated financial statements in the current period, including:
1. Subsidiaries, special purpose entities, and business entities that gain control by way of commissioning
management or renting included in the consolidation scope in the current period
Name Reason for change
Suzhou SEG Intelligent Technology Co., Ltd. Newly established
Shenzhen SEG Longyan New Energy Application
Newly established
and Development Co., Ltd.
Shenzhen SEG Longyan Energy Technology Co.,
Newly established
Ltd.
2. Subsidiaries, special purpose entities, and business entities that lose control by way of commissioning
management or leasing excluded from the consolidation scope in the current period
Name Reason for change
Shenzhen SEG E-commerce Co., Ltd. Transfer-out of all equities
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
(7) Information about significant changes or adjustments of business, product or service in the report
period
□ Applicable √ Not applicable
(8) Information on main customers and main suppliers
Information about the Company's major customers
Sales amount of top 5 customers (Yuan) 178,353,088.59
Percentage of the total sales amount of top 5 customers to
26.53%
the annual sales
Percentage of the sales amount of related parties among
0.00%
top 5 customers to the annual sales
Information about top 5 customers
No. Customer Name Sales amount (Yuan) Percentage of the annual sales amount
1 Shenzhen Runneng Digital Co., Ltd. 86,573,198.09 12.88%
Shenzhen Nanfang Yunhe Technology Co.,
2 52,034,318.22 7.74%
Ltd.
3 Shenzhen Comnet Technology Co., Ltd. 18,413,719.60 2.74%
Xinjiang Zhongdi Communication
4 13,445,496.60 2.00%
Equipment Co., Ltd.
5 Shenzhen Wonder Industry Co., Ltd. 7,886,356.08 1.17%
Total -- 178,353,088.59 26.53%
Other information on main customers
□ Applicable √ Not applicable
Information about major suppliers
Total purchase amount of top 5 suppliers (Yuan) 158,288,064.96
Percentage of the total purchase amount of top 5 suppliers
27.17%
to the annual purchase
Percentage of the purchase amount of related parties
0.00%
among top 5 customers to the annual purchase amount
Information about top 5 suppliers
No. Name of supplier Purchase amount (Yuan) Percentage of the annual purchase
1 www.189zg.cn 45,473,737.61 7.81%
2 Shenzhen Shuojian Industry Co., Ltd 44,717,876.92 7.68%
Telling Telecommunication Holding Co.,
3 32,862,893.16 5.64%
Ltd.
Shenzhen Youyou Financial Service Co.,
4 18,862,559.83 3.24%
Ltd.
Beijing Hengsha Science and Technology
5 16,370,997.44 2.81%
Co., Ltd.
Total -- 158,288,064.96 27.17%
Other information on main suppliers
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
□ Applicable √ Not applicable
3. Expense
Unit: Yuan
Year-on-year
2016 2015 increase/decrease Description of significant changes
(%)
In the report period, the opening of Nantong
SEG Times Plaza incurred the expense of
Sale expenses 13,846,141.59 4,585,434.23 201.96% RMB 10,510,000, and the newly-added
investment in the subsidiary SEG Intelligent
added to the sales expense of the Company.
In the report period, major assets restructuring
incurred the expense of RMB 16,800,000 and
Management expenses 60,042,027.31 44,222,779.09 35.77%
the compensation of RMB 1,440,000 was paid
due to SEG E-commerce restructuring.
In the report period, due to the completion and
opening of Nantong SEG Times Plaza, the
Financial cost 4,627,175.84 3,564,776.76 29.80% interest expense capitalized decreased and the
interest expense included in profit or loss
increased.
4. Investment in research and development
□ Applicable √ Not applicable
5. Cash Flow
Unit: Yuan
Year-on-year increase/decrease
Item 2016
(%)
Subtotal of cash inflow from
1,313,569,362.59 2,188,033,814.36 -39.97%
operating activities
Subtotal of cash outflow in
1,433,599,420.27 2,200,487,338.18 -34.85%
operating activities
Net cash flow from operating
-120,030,057.68 -12,453,523.82
activities
Subtotal of cash inflow from
805,548,757.27 2,264,549,143.15 -64.43%
investing activities
Subtotal of cash outflow in
729,919,986.64 2,172,173,875.73 -66.40%
investing activities
Net cash flow from investing
75,628,770.63 92,375,267.42 -18.13%
activities
Subtotal of cash inflow from
461,367,812.30 442,000,000.00 4.38%
financing activities
Subtotal of cash outflow in
512,995,153.98 628,455,033.90 -18.37%
financing activities
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Year-on-year increase/decrease
Item 2016
(%)
Net cash flow arising from
-51,627,341.68 -186,455,033.90
financing activities
Net increase in cash and cash
-96,028,613.26 -106,533,251.60
equivalents
Description of main factors of significant year-on-year change
√ Applicable □ Not applicable
1. Subtotal of cash inflow from operating activities decreases by 39.97% year on year in the report period,
mainly due to decline in the supply chain business of SEG E-commerce, trading business contraction of SEG
Industry, and decrease in the cash flow.
2. Subtotal of cash outflow from operating activities decreases by 34.85% year on year in the report period,
mainly for the following reasons:
(1) Decline in the supply chain business of the subsidiary SEG E-commerce results in decrease in the cash paid
in the report period.
(2) The purchasing expense for trading business of the subsidiary SEG Industry decreases year on year in the
report period.
3. Net cash flow from operating activities decreases year on year in the report period, mainly due to year-on-year
growth of the real estate development expense of Nantong SEG.
4. Subtotal of cash inflow from investing activities decreases by 64.43% year on year in the report period, mainly
due to reduction of investment in bank financing.
5. Subtotal of cash outflow from investing activities decreases by 66.40% year on year in the report period,
mainly because reduction of investment in bank financing resulted in decrease in investment return.
6. Net cash flow from investing activities decreases by 18.13% year on year in the report period, mainly because
larger investment return resulted in larger net cash inflow from investing activities in the same period of the
previous year while the reduction of investment in bank financing resulted in decrease in investment return in the
report period.
7. Subtotal of cash inflow from financing activities increases by 4.38% year on year in the report period, mainly
due to increase in bank loans obtained by the Company.
8. Subtotal of cash outflow from financing activities decreases by 18.37% year on year in the report period,
mainly due to the Company's repayment of the due bank loans and decrease in the principal and interest of
short-term financing bond.
9. Net cash flow from financing activities increases year on year in the report period, mainly because the
financing scale of the Company decreased and cash outflow was larger in the same period of the previous year
while the financing scale of the Company was basically flat in the report period.
10. Net increase in cash and cash equivalents increase year on year in the report period, for the reasons described
in Items 7, 8, and 9.
Reasons for the big difference between the net cash flow arising from operating activities and the annual net
profit in the report period
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
□ Applicable √ Not applicable
III. Analysis of Non-major Business
√ Applicable □ Not applicable
Unit: Yuan
Percentage of
Amount Reason Sustainable or not
total profit
1. Gains on reduction of holding-shares of
Huakong SEG and sales of the equity of
1. Unsustainable
Investment income 99,145,904.44 52.87% SEG E-commerce;
2. Sustainable
2. financial income and income from
investment in joint ventures
Impairment provision for loans and
Asset impairment -3,476,898.53 -1.85% Partially sustainable
advances granted by subsidiary SEG Credit
Non-operating Government subsidies and liquidated
10,897,524.02 5.81% Partially sustainable
income damages
Non-operating Litigation compensation of Nanning SEG in
4,366,432.31 2.33% Unsustainable
expenses the report period
IV. Assets and Liabilities
1. Significant Changes in Asset Formation
Unit: Yuan
End of 2016 End of 2015
Increase/decre Description of
Percentage of Percentage of
Amount Amount ase significant changes
total assets total assets
Monetary funds 183,094,815.84 7.19% 276,863,429.10 10.59% -3.40%
Accounts
50,870,545.72 2.00% 98,212,422.87 3.76% -1.76%
receivable
Inventory 602,098,738.92 23.63% 450,809,934.72 17.24% 6.39%
Investment
425,169,768.62 16.68% 443,851,726.40 16.98% -0.30%
properties
Long-term equity
183,649,044.67 7.21% 185,122,573.88 7.08% 0.13%
investment
Fixed assets 39,181,793.82 1.54% 37,524,425.25 1.44% 0.10%
Construction in
0.00% 140,810.00 0.01% -0.01%
progress
Short-term
355,000,000.00 13.93% 367,759,630.48 14.07% -0.14%
borrowing
2. Assets and liabilities measured based on fair value
√ Applicable □ Not applicable
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Unit: Yuan
Cumulative
Change in fair change in fair Impairment Amount of Amount of
Opening Closing
Item value of the value accrued in the purchase in the sales in the
balance balance
current period recognized in current period current period current period
the equity
Financial assets
3.
Available-for-sa
744,580.41 -61,289.83 683,290.58
le financial
assets
Subtotal of
744,580.41 -61,289.83 683,290.58
financial assets
Total 744,580.41 -61,289.83 683,290.58
Financial
0.00 0.00
liabilities
Are major asset measurement attributes of the Company materially changed in the report period?
□ Yes √ No
3. Restricted asset rights as of the end of the report period
□ Applicable √ Not applicable
V. Investment
1. General
√ Applicable □ Not applicable
Investment over the same period of the
Investment in the report period (Yuan) Increase/decrease (%)
previous year (Yuan)
167,406,096.68 171,899,357.22 -2.61%
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
2. Significant equity investment in the report period
√ Applicable □ Not applicable
Unit: Yuan
Investment
Progress as
profit or
Main Investment Investment Shareholding Source of Investment Product of the Projected Lawsuit Disclosure Disclosure
Investee name Partner loss of the
business mode amount percentage capital horizon type balance income involved date (if any) index (if any)
current
sheet date
period
http://www.cnin
fo.com.cn
Announcement
of Shenzhen
Suzhou SEG
SEG Co., Ltd.
Intelligent Newly- Self-owned Not -3,445,047. January 13,
Trade 10,000,000.00 100.00% None Digital Opening No on the
Technology established capital applicable 53
Establishment of
Co., Ltd.
Shenzhen SEG
Intelligent
Technology Co.
Ltd.
Advanced
Solar Power http://www.cnin
(Hangzhou ) fo.com.cn
Inc., Announcement
Shenzhen SEG Shenzhen of Shenzhen
Longyan New Raytai SEG Co., Ltd.
Energy
Newly- Self-owned Technology Not Photovol In May 10, on Foreign
Application Energy 2,500,000.00 50.00% Photovoltaic 0.00 No Investment and
established capital applicable taic preparation
and Engineering Establishment of
Development Co., Ltd., SEG Longyan
Co., Ltd. Shenzhen New Energy
Energy Application and
Nanjing Development
Energy Co., Ltd.
Holdings
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Limited
http://www.cnin
fo.com.cn
Announcement
of Shenzhen
Shenzhen SEG Co., Ltd.
International on Equity
Shenzhen
Consumer Investment and
Exhibiti Newly- Self-owned Futian Not Exhibitio In -8,181,957. May 12,
Electronics 9,000,000.00 30.00% 0.00 No Establishment of
on established capital Investment applicable n preparation 94
Exhibition/Exc Shenzhen
Co., Ltd.
hange Center International
Co., Ltd. Consumer
Electronics
Exhibition/Exch
ange Center
Co., Ltd.
http://www.cnin
fo.com.cn
Advanced
Solar Power Announcement
(Hangzhou ) of Shenzhen
Shenzhen SEG Inc., Southern SEG Co., Ltd.
Longyan Raytai Group, on the
Newly- Self-owned Not In November Establishment of
Energy Energy 82,500,000.00 50.00% Shenzhen Energy 0.00 No
established capital applicable preparation 12, 2016 SEG Longyan
Technology Energy
Co., Ltd. Nanjing Energy
Energy Technology Co.,
Holdings Ltd. and Launch
Limited of CdTe Film
Photovoltaic
Industrial Base
104,000,000.0 -11,627,005
Total -- -- -- -- -- -- -- -- 0.00 -- -- --
0 .47
3. Significant non-equity investment in progress in the report period
√ Applicable □ Not applicable
Unit: Yuan
Investment Fixed asset Industries Amount of Accumulated Source of Projected Accumulated Reasons for Disclosure Disclosure
Project name Progress
mode investment? involved in investment amount capital income income as of failure to date (if any) index (if any)
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
investment during the invested as of the end of the achieve the
report period the end of the report period plan schedule
report period objective and
expected
income
Self-owned
Nantong SEG Not
Self-constructed No Real estate 148,406,096.68 597,264,847.59 capital and 0.00 -8,396,389.16
Times Plaza applicable
bank loans
Total -- -- -- 148,406,096.68 597,264,847.59 -- -- 0.00 -8,396,389.16 -- -- --
4. Financial assets investment
(1) Security investment
√ Applicable □ Not applicable
Unit: Yuan
Gains and
losses Amount of
Accumulative Amount of
Short form Accounting from fair purchase Gains and
Stock Initial Opening book change of fair sales in the Closing book Source of
Stock type of the measurement value in the losses in the Accounting item
code investment cost value value counted current value capital
security mode changes in current report period
into equity period
the current period
period
Domestic and
Youhao Measurement Available-for-sale Self-owned
overseas 600778 90,405.00 744,580.41 -61,289.83 0.00 0.00 0.00 683,290.58
Group of fair value financial assets capital
shares
Domestic and Measurement
Huakong Self-owned
overseas 000068 204,864,058.29 of cost 181,743,161.07 178.21 -9,086,648.37 1,895,383.08 174,552,073.99 Other assets
SEG capital
shares method
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Gains and
losses Amount of
Accumulative Amount of
Short form Accounting from fair purchase Gains and
Stock Initial Opening book change of fair sales in the Closing book Source of
Stock type of the measurement value in the losses in the Accounting item
code investment cost value value counted current value capital
security mode changes in current report period
into equity period
the current period
period
Domestic and Measurement
SEG Available-for-sale Self-owned
overseas 832770 8,275,321.43 of cost 13,515,392.83 0.00 0.00 0.00 13,515,392.83
Navigations financial assets capital
shares method
Total 213,229,784.72 -- 196,003,134.31 -61,111.62 -9,086,648.37 1,895,383.08 188,750,757.40 -- --
(2) Investment of derived products
□ Applicable √ Not applicable
No investment in derivatives is involved in the report period.
5. Use of the collected capital
□ Applicable √ Not applicable
In the report period, there was no usage of raised capital.
VI. Sales of Major Assets and Equity
1. Sales of Major Assets
√ Applicable □ Not applicable
Net profit Proportion
Association Transfer Transfer of Implemented
contributed Impact of of the net Pricing
Transaction by the with the of all all as scheduled
the sale profit principle
Date of price or not? If Disclosure
Counterparty Sold assets asset to the on the contributed for the Connected counterparty property creditor's
Disclosure index
sale (RMB transaction? (applicable rights of rights and not, indicate date
listed Company by the sale of
10,000) to connected assets debts reasons and
company (Note 3) assets to assets
transactions) involved? involved? measures
from the the listed
taken by the
beginning company
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
of the to total net Company
period to profit
the date of
sale (RMB
10,000)
51% of the Announcement on the
equity of Progress of Equity
Wang Shenzhen December December Transfer of Shenzhen SEG
534.97 -430.75 348.64 3.17% Fair value No N/A Yes Yes Transferred
Yunling SEG 8, 2016 15, 2016 E-commerce Co., Ltd.
E-commerce disclosed on
Co., Ltd. http://www.cninfo.com.cn
Announcement on the
Implementation of
10,066,700
Secondary Reduction of
shares of December December
market 8,815 8.72 8,620.23 78.27% Fair value No N/A Yes Yes Transferred Holding-shares of
Huakong 31, 2016 31, 2016
investors Shenzhen SEG Co., Ltd.
SEG
disclosed on
http://www.cninfo.com.cn
2. Sales of Major Equity
√ Applicable □ Not applicable
Net profit
contributed Proportion
by the asset of the net Implemented
to the listed profit Association as scheduled
Impact of
company contributed Pricing with the or not? If
Transaction the sale on Transfer of
from the by the principle for Connected counterparty not, indicate Disclosure
Counterparty Sold assets Date of sale price (RMB the all equities Disclosure index
beginning assets to the the sale of transaction? (applicable reasons and date
10,000) Company involved?
of the listed assets to connected measures
(Note 3)
period to company to transactions) taken by the
the date of total net Company
sale (RMB profit
10,000)
51% of the Announcement on the
equity of Progress of Equity
Wang Shenzhen December December Transfer of Shenzhen SEG
534.97 -430.75 348.64 3.17% Fair value No None Yes Yes
Yunling SEG 8, 2016 15, 2016 E-commerce Co., Ltd.
E-commerce disclosed on
Co., Ltd. http://www.cninfo.com.cn
Secondary 10,066,700 December 8,815.09 8.72 8,620.23 78.27% Fair value No None Yes Yes December Announcement on the
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
market shares of 31, 2016 31, 2016 Implementation of
investors Huakong Reduction of
SEG Holding-shares of
Shenzhen SEG Co., Ltd.
disclosed on
http://www.cninfo.com.cn
VII. Analysis of Controlling and Holding Companies
√ Applicable □ Not applicable
Information on main subsidiaries and holding companies with more than 10% influences on the Company's net profits
Unit: Yuan
Company name Company type Main business Registered capital Total assets Net assets Operating income Operating profit Net profit
SEG Credit Subsidiary Micro-credit 150,000,000.00 527,128,411.41 190,217,607.42 78,351,087.18 42,273,929.06 31,709,669.74
Property operation and
SEG Baohua Subsidiary 30,808,800.00 160,403,186.06 112,528,058.07 80,289,375.74 35,800,313.60 26,881,089.95
management and hotel business
Channel retail terminal of
SEG Industry Subsidiary electronic products and property 25,500,000.00 103,489,093.25 44,646,580.89 183,761,151.85 6,312,881.57 5,984,662.68
operation and management
Operation and management of
Longgang SEG Subsidiary 3,000,000.00 18,632,641.84 7,365,800.29 8,885,058.01 2,302,057.14 1,766,813.36
professional electronics market
Operation and management of
Shunde SEG Subsidiary 6,000,000.00 4,768,727.23 3,251,329.59 3,020,405.16 66,777.56 92,107.04
professional electronics market
Operation and management of
Changsha SEG Subsidiary 35,000,000.00 90,333,829.24 69,762,432.18 24,597,175.67 8,597,440.66 6,004,911.59
professional electronics market
Operation and management of
Xi'an SEG Subsidiary 3,000,000.00 42,746,870.72 18,277,318.13 39,901,579.15 12,566,775.67 10,729,264.73
professional electronics market
Operation and management of
Xi'an Hairong SEG Subsidiary 3,000,000.00 27,047,412.83 5,470,844.74 21,185,817.21 2,384,182.47 2,187,519.46
professional electronics market
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Company name Company type Main business Registered capital Total assets Net assets Operating income Operating profit Net profit
Operation and management of
Nanjing SEG Subsidiary 20,000,000.00 23,115,769.70 4,436,932.79 24,795,038.43 -4,778,383.95 -4,552,613.66
professional electronics market
Operation and management of
Wujiang SEG Subsidiary 3,000,000.00 23,504,627.13 5,084,589.72 15,420,790.93 2,136,733.06 1,777,325.36
professional electronics market
Operation and management of
Wuxi SEG Subsidiary 3,000,000.00 15,945,797.55 4,471,380.86 5,820,882.30 741,528.88 526,070.18
professional electronics market
Operation and management of
Suzhou SEG Subsidiary 3,000,000.00 36,718,623.73 11,421,072.36 41,978,978.54 8,126,629.35 5,980,331.82
professional electronics market
Operation and management of
Suzhou SEG Digital Subsidiary 8,000,000.00 22,832,637.84 -2,049,294.53 27,149,253.66 491,000.53 493,897.43
professional electronics market
SEG Intelligent Subsidiary Trade 10,000,000.00 12,190,666.91 6,554,952.47 93,162,471.75 -3,461,244.46 -3,445,047.53
Development and operation of
Nantong SEG Subsidiary 30,000,000.00 720,210,231.69 21,603,610.84 -10,227,118.54 -2,208,110.04
real estate
Nantong SEG
Commercial Subsidiary Property Operation - 8,843,404.99 -4,501,816.70 878,147.31 -4,501,343.74 -4,501,343.73
Operation
SEG E-Commerce Subsidiary E-commerce - 19,856,069.34 -4,433,595.83 -4,307,477.61
Manufacturing and operation of
Shareholding
Huakong SEG color picture tube (CPT), CPT 1,006,671,464.00 1,313,724,068.11 800,907,363.73 297,563,205.88 21,931,533.98 8,723,288.17
company
materials, and glass apparatus
Shareholding Operation and management of
Shanghai SEG 5,000,000.00 17,903,203.15 9,827,332.82 7,333,583.64 657,870.52 491,843.57
company professional electronics market
Shareholding
CEEC Electronics exhibition 30,000,000.00 23,006,940.08 21,818,042.06 4,675,561.08 -8,181,856.34 -8,181,957.94
company
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Information on the acquisition and disposal of subsidiaries in the report period
√ Applicable □ Not applicable
Mode of acquisition and disposal of
Company name Impact on the overall production and performance
subsidiaries in the report period
It achieved the operating income of RMB 93.16
Suzhou SEG Intelligent
Newly-established million and the loss of RMB 3.45 million in the
Technology Co., Ltd.
report period.
Shenzhen SEG Longyan New
It is in preparation and has not opened for business
Energy Application and Newly-established yet.
Development Co., Ltd.
Shenzhen SEG Longyan Energy It is in preparation and has not opened for business
Technology Co., Ltd. Newly-established yet.
It achieved the operating income of RMB 19.86
Shenzhen SEG E-Commerce Co.,
Transfer of all equities million and the loss of RMB 4.31 million in the
Ltd.
report period.
Information on controlling and holding companies
1. In the report period, the operating income of SEG Industry decreases by 32.96% over the previous year. For
more reasons, see the third point of 1. Overview in Section 4 - II. Analysis of Main Business.
2. In the report period, the operating income of Longgang SEG decreases by 15.81% over the previous year.
Because the vacancy rate of the market increased, the operating income decreased and total profit was down.
3. In the report period, the operating income of Shunde SEG increases by 22.06% over the previous year, mainly
because the occupancy rate of the company significantly rose, the overall renewal rate reached 90%, and leasing
of small offices was stable.
4. In the report period, the operating income of Nanjing SEG decreases by 23.52% over the previous year. The
occupancy rate of Nanjing SEG from January to May was lower than that in the same period of the previous year.
The market occupancy rate rose in the second quarter, but preferences during the decoration period for new
merchants resulted in decrease in the operating income of the company.
5. In the report period, the total profit of Wujiang SEG increases by 39.97% over the previous year, mainly
because the rental income and advertising income increased by 5.93% and the gross profit increased.
6. In the report period, the operating income of Wuxi SEG decreases by 17.77% over the previous year and the
total profit decreases by 39.97%, mainly because the overall market occupancy rate decreased year on year. The
decrease in the rental income led to decrease in the total profit. Besides, other receivables of the Company
increased and the amount of funds decreased, and the financial income decreased by RMB 270,000 year on year.
7. In the report period, the operating income of Suzhou SEG increases by 69.09% over the previous year, mainly
because the property lessor Zongheng International Electronic Expo City (Suzhou) Co., Ltd. sold the property
and the parties reached a temporary agreement. In Q4 2016, the paid rent decreased by RMB 1,206,000 year on
year. The cost decreased and the profit increased. Besides, the litigation compensation to Suzhou Rail Transit
was incurred in same period of the previous year while no such compensation was incurred in the current period.
8. In the report period, the operating income of Suzhou SEG Digital decreases by 21.85% over the previous year,
mainly because the company adjusted business types and terminated direct selling of digital products. As new
business types generated higher returns. Suzhou SEG Digital turns from deficits to profit in the report period.
9. As a newly-established enterprise in the report period, Intelligent Technology engages in smart home business,
develops intelligent and engineering projects, and provides multiple intelligent solutions for home, engineering,
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
and plants. The company achieves the annual operation income of RMB 93,160,000. As the low gross profit rate
is low and the organization expense is recognized in the current profit or loss, the Company has a loss of RMB
3,450,000 in the report period.
10. In the report period, the operating income of Nantong SEG was RMB 4,500,000, mainly because Nantong
SEG Times Plaza starts business and the organization expense is recognized in the current profit or loss.
11. The Company sold all its equity of SEG E-commerce in the report period. The operating income attributable
to the listed company decreases by 44.19% in the report period. For details, see the Announcement of Shenzhen
SEG Co., Ltd. on the Progress of Equity Transfer of SEG E-commerce (No. 2016-112) published by the
designated information disclosure media of the Company on December 15, 2016.
VIII. Information on Structural Entity Controlled by the Company
□ Applicable √ Not applicable
IX. Outlook of future development of the Company
(I) Future development planning of the Company
1. Implementation of major assets restructuring
The Company's application for issuing shares and paying cashes to acquire assets and raise supporting funds &
connected transaction has been approved by the Approval on Shenzhen SEG Co., Ltd.'s Issuing Shares to
Shenzhen SEG Group Co., Ltd. to Acquire Assets and Raise Supporting Funds (Z. J. X. K. [2017] No. 21) on
January 17, 2017.
On January 19, 2017, business registration formalities for shareholder alteration related to transfer of 100% of
the equity of SegMaker, 55% of the equity of SEG Kangle, 100% of the equity of SEG Property Development,
and 79.02% of the equity of SEG Real Estate held by SEG Group to the Company was completed. After the
completion of alteration, the Company holds 100% of the equity of SegMaker, 55% of the equity of SEG Kangle,
100% of the equity of SEG Property Development, and 79.02% of the equity of SEG Real Estate.
On January 21, 2017, Da Hua Certified Public Accountants (special general partnership) hired by the Company
verified newly-added capital stock of RMB 450,857,239 arising from share issuance of the Company, and issued
a verification report (D. H. Y. Zi. [2017] No. 000044).
450,857,239 A shares were issued by the Company through private placement (including 450,857,239 restricted
shares) and listed from March 6, 2017.
After the said private placement, the core assets of SEG Group were injected into the listed company, reducing
horizontal competition to the greatest extent. The listed company after restructuring will be based on electronics
markets, commercial (industrial park) real estate, maker business, and CdTe film solar business, promote
interactive development with multiple business models, comprehensively integrate business resources, build
SEG new industrial eco-circle, create a diversified and strategic emerging industry development platform, and
develop into a leader in high-end manufacturing and services.
In terms of transformation of the existing specific main business, the Company will be based on electronics
markets, combine service advantages and customer resources of electronics markets, step up efforts to develop
the maker business, culture and education, intelligent technology, sports and entertainment, virtual experience,
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
e-sports, financial services, strategic emerging industries, high-end manufacturing and services, optimize and
integrate the business chain systems, and implement industrial transformation and upgrading.
2. In 2017, the Company will rely on the capital market and the platform as a listed company, center around the
Company's 13th five-year plan, be based on its actual development and existing resources, make full use of
capital market, integrate internal and external resources, carry out capital operation mainly through the \"external
industrial mergers and acquisitions\", \"investment funds\" and other models, and deliver a platform for diversified
strategic emerging industries.
2017 investment plan of the Company focuses on commercial (industrial park) real estate and business
transformation and upgrading. The total amount of the investment plan is expected to be RMB 1,813,760,000,
consisting of RMB 1,302,410,000 for commercial real estate projects (including fund raising and investment
projects, Nantong SEG Times Plaza, etc.), RMB 462,100,000 for new investment projects (including CdTe
project, Hongtu SEG Intelligent Industrial Fund, and e-sport Internet café etc.), and the non-operating capital
expenditure of RMB 49,250,000.
(II) Completion Result of Main financial budget and investment plan of 2016:
1. The Company released the Announcement of Resolution of 9th meeting of the 6th Session of the Board of
Directors on March 30, 2016, wherein main financial budget targets of 2016 was disclosed. The completion
result is shown in the table below:
Unit: RMB 10,000
No. Item Budget target of 2016 Actual amount of 2016 (audited)
1 Total assets 293,504 254,828
2 Total liabilities 121,830 78,977
3 Operating income 85,638 76,092
4 Owners' equity 171,674 175,851
5 Including: Owners' equity attributable to the 151,858 154,820
parent company
6 Asset-liability ratio 41.51% 30.99%
7 Management expenses 6,416 6,004
2. 2016 annual project investment plan of the Company focuses on business transformation and upgrading,
which is expected to be RMB 326,700,000 in total.
Unit: RMB 10,000
No. Project name Annual Cumulative Project progress
budget completed
investment investment
1 Nantong SEG Times Plaza 14,100 15,573 Nantong projects Animation Industrial Park and
animation business hqve opened and put into operation.
2 New investment project 18,570 3560.36
(1) SEG intelligent technology project 1,000.00 The new company has been registered and RMB
10,000,000 is invested in the registered capital. The
company is in formal business.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
(2) Shenzhen International Consumer 900.00 The new company has been registered and RMB
Electronics Exchange/Exhibition 9,000,000 is invested in the registered capital,
Center Co., Ltd. accounting for 30% of the equity.
(3) SEG \"Internet café project 240.44 The company signed the strategic cooperation agreement
with Allied eSports and Wangyu Technology. The first
project is located at 4F of Nantong SEG Times Plaza and
open for business on October 28, 2016. Suzhou store and
Shenzhen Allied eSports flagship store are in progress.
(4) Children project reserve 319.92 The company set up Children's Industry Division in
August 2016, which is responsible for development,
expansion and operation of SEG children's theme
experience venue. The first project was launched in
Nantong SEG Times Plaza and open for business on
October 28, 2016.
(5) New hotel investment project 1,100.00 In May 2016, the Company signed the lease contract
concerning the original Dongmen hotel property located
at 2195 Hubei Road and invested in the establishment of
Dongmen Branch of Mellow Orange Hotel. The
decoration of the hotel has been completed. The
company is applying for the license for special industries
and preparing for the opening.
Total 32670 19133.36
Note: There is deviation between 2016 project investment plan and the actual completion result because: Hongtu
SEG Intelligent Industrial Fund is under examination and approval and has not been funded yet; for industrial
reasons and prudence, the Company has not invested in new electronics market projects.
(III) Summary of progress of development strategies and operation plans disclosed earlier in the report
period
According to the development strategies disclosed by the Company in the annual report of 2015, the Company
would try to change from the traditional profit model focusing on rental income to the profit model of
multi-channel platform. The Company dug into the user values, expanded value-added service connotations and
increased users' experience. By integrating all kinds of tangible and intangible resources on the inventory market,
the Company created the maker service platform, financial service platform and electronics market operation
platform, facilitated SEG Electronics Market to transfer from the traditional profit model focusing on rental
income to the profit model of multi-channel platform. At the same time, the Company has set foot in emerging
strategic industries such as CdTe film solar energy.
In the report period, the main work done by the Company is as follows:
1. In order to reduce horizontal competition at the maximum, enhance the profitability and core
competitiveness of listed company, and fully integrate the business of electronics markets by relying on the
platform of the listed company, eventually fulfill integration, transformation and upgrading of current business
of the listed company, facilitate the Company to develop toward diversified business, extend the industrial chain,
expand the profit margins of the listed company, and enhance the influence of the listed brand, the Company
carried out major assets restructuring in 2016.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
For restructuring, the Company intended to purchase 100% of the equity of SegMaker, 55% of the equity of SEG
Kangle, 100% of the equity of SEG Property Development and 79.02% of the equity of SEG Real Estate held by
SEG Group by means of issuing shares and paying cash to acquire assets, in which the percentage of payment by
the equity is 86.90% and that of cash payment 13.10%. At the same time, in order to improve the efficiency of
restructuring, the Company intended to raise the supporting fund for the restructuring from no more than 10
specific investors by means of non-public offering, with the total raised fund no more than 38.78% of the
transaction price of the assets to be acquired. According to the appraised value, the total amount of assets did not
exceed RMB 2 billion.
On November 15, 2016, China Securities Regulatory Commission Acquisition and Restructuring Committee
conditionally approved Shenzhen SEG issuing shares and paying cash to acquire assets and raising supporting
fund as well as related party transaction issues on the 85th Acquisition and Restructuring Committee Working
Meeting of 2016.
On January 17, 2017, the Company received the Approval on Shenzhen SEG Co., Ltd.'s Issuing Shares to
Shenzhen SEG Group Co., Ltd. to Acquire Assets and Raise Supporting Funds (Z. J. X. K. [2017] No. 21) issued
by China Securities Regulatory Commission, which approved the Company to issue 450,857,239 shares to SEG
Group to acquire relevant assets and raise supporting funds for the said share issuance and asset acquisition by
non-public offering of no more than 201,207,243 new shares. The said approval document issued by China
Securities Regulatory Commission will be valid within 12 months after the issuance.
The transfer formalities of the subject assets were completed on January 19, 2017, and the 450,857,239 new
shares in A-share by non-public offering were listed for trading on March 6, 2017.
2. Transformation and upgrading of electronics markets and implementation of new businesses are actively
carried out by the Company.
(1) E-sports and Internet cafébusiness
In terms of e-sports, the Company signed the Regional Agency Contract of Wangyu Internet Caféwith Shanghai
Wangyu Information Technology Co., Ltd. on March 14, 2016 to develop strategic cooperation with Wangyu, by
using respective advantages of platform and resources, to deploy \"e-sport\" physical stores on the basis of
subordinate property assets. The Company would reproduce layout in subordinate properties or core business
circles of core cities based on operation situation, maturity and market demand of the e-sport projects. Therefore,
the Company established the E-sport Division in August 2016, in charge of development, expansion and
operation of business related to e-sports. At present, the first physical store \"Wangyu Internet
Café-EventE-sports\" arranged in Nantong SEG was put into trial operation in October 2016, and relevant
operation data met the expectations. Apart from daily operation, two e-sport competitions have been held and
attracted 32 teams and nearly 400 people, achieving good brand benefits. The e-sport venue has a construction
area of 1600 m2 and investment of RMB 5,000,000. Now the second e-sport venue has settled in Suzhou and is
nearly finished. It is expected to open for business in April 2017. The Company signed the Strategic Cooperation
Agreement with Tianjin Allied eSports on December 16, 2016. The parties jointly invested RMB 24,800,000 to
establish Shenzhen SEG Lianzhong Internet Technology Co., Ltd. to carry out the operation projects of
large-scale comprehensive e-sport venues. The Company acquired the business license on February 10, 2017.
The Company invested RMB 13,640,000, accounting for 55% of the shares. The e-sport project will integrate
upstream and downstream resources of the e-sport industry, create super top-rank comprehensive entertainment
venues of e-sport events in China, and create an e-sport club that integrates \"games, leisure bars, online and
offline communication platform for professional electronic gamers and players\". The project was started for
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
construction at the end of February 2017 and is expected to finish in June 2017 and can undertake large-scale
e-sports events.
(2) Children's experience business
In order to build a new commercial operation platform of SEG Electronics Market and actively promote the
transformation and upgrading of the main business of the Company-the physical electronics markets, based on
its actual situation and the needs of business transformation, the Company planned to create a scene-mode
children's technology and culture experience platform that focuses on education and culture, and covers also
children's animation, experience, education, service and entertainment.
Therefore, the Company established the Children's Industry Division in August 2016, dedicated to development,
expansion and operation of SEG children's theme experience venue. The first project was launched in Nantong
SEG Times Plaza and open for business on October 28, 2016. The children's type of business is the largest
backbone store in Nantong project, which is packaged with Babycat animation image as the theme of the park
with a usable area of 2,235 m2. Driven by stable customers, sufficient customer flow has been brought to other
types of business and promoted increase in the sales volume per square meter rented of the shopping mall. Since
the operation of the children's amusement park project, it has attracted 3,800 WeChat followers, more than 1,500
members, and nearly 100% customer retention rate.
(3) E-commerce business cooperation with Taobao
In order to actively promote the transformation and upgrading of the main business of the Company, i.e. the
physical electronics markets, accelerate the combination of physical electronics markets and Internet, explore
new types of cooperation methods and create an \"Internet +\" model truly with SEG features and internal core
value, the Company signed the Strategic Cooperation Agreement of Taobao \"Enterprises Purchasing\" Project
with Taobao (China) Software Co., Ltd. on January 27, 2016 (see the announcement of Shenzhen SEG Co., Ltd.
on signing the strategic cooperation agreement with Taobao (China) Software Co., Ltd. on January 28, 2016 for
details), aiming at promoting SEG's unique online and offline mixed service mode by organically integrating the
advantages of physical merchants of SEG Electronics Market and Taobao's online resources. In order to
implement and facilitate the work, the Company set up the E-commerce Division in August 2016, which is
dedicated to the implementation and settlement of the strategic cooperation projects with Taobao, assumes other
business functions related to e-commerce and explores new profit mode. SEG set up \"SEG Taobao Zone\" in
Taobao and was launched on September 29, 2016, obtained the distribution access on the front page, and tried to
make the domain of the zone a secondary domain of Taobao. The total gross merchandise volume (GMV) in half
a year after launch is nearly RMB 800 million. At present, more than 2,600 merchants have formally entered.
The launch of \"SEG@Taobao DIY-one-stop electronic components purchasing channel\" indicates that the
strategic cooperation between the Company and Taobao's industrial market has been fully implemented and
material breakthrough has been achieved. A solid step has been made on the way of creating innovative and
value-added services of O2O electronics market with SEG features.
(4) Makers business
In order to implement the Company's development strategies, fully promote \"mass entrepreneurship and
innovation\", and establish a complete \"SEG maker\" industrial ecological system, the Company signed a
Three-party Cooperation Agreement with SegMaker and Tencent on April 5, 2016. The three parties will use
respective platform and resources advantages to carry out strategic cooperation, jointly create comprehensive
venture service platform that combines incubation and investment, physical hardware display and distribution
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
platform under key cooperation and hardware lab platform of pragmatic innovation services, and establish a
venture incubation service benchmark integrating software and hardware in China.
At the same time, the Company signed the Strategic Cooperation Agreement with Tmall on April 8, 2016. The
two parties will carry out strategic cooperation in terms of target recommended cooperation in makers products
or mature products, cooperation in the maker support event of \"global gathering and innovation\" Internet
intelligent acceleration channel, online and offline marketing events, media promotion and resources
complementation. From April 9 to April 12, 2016, SEG products were promoted in Juhuasuan for 3 days
successively. Through joint selection by Alibaba and SEG, 20 \"black technology\" products that participated in
the event were sold on the platform. During the 3 days, nearly 30,000 pieces were traded, and 1,000 pieces in
promotional products of 12 types were traded, and the total sales volume exceeded RMB 10 million.
In the report period, SEG CPARK signed cooperation agreements with more than 30 brands. Meanwhile SEG
CPARK product training and children's science popularization education will be carried out synchronously. At
present, the maker education project of SEG CPARK is designed to develop a maker education complex which is
oriented towards \"maker education activities\" as the theme and integrates scientific innovation, education,
competition, experience, achievement transformation, and team culture construction. With the activity center as
the carrier, the project brings in enterprises or teams featuring advanced technologies and product innovation,
provides schools, organizations and families with the space for off-campus practice, maker classes, and
parent-child experience. The project is in cooperation with Makeblock, Mago Imagineer, Zhongyi Sports, and
Zhihui Tongxing.
Hongtu SEG Intelligent Industrial Investment Fund: Hongtu SEG Intelligent Industrial Investment Fund jointly
initiated and established by the Company and Shenzhen Capital Group Co., Ltd. and Shenzhen Guiding Fund has
a scale of RMB 300 million. Its main target of investment includes: Hongtu SEG Fund mainly for new intelligent
electronic information industry, wearable intelligent devices, intelligent equipment, 3D printing, robot, VR/AR
industry and Internet of things, Internet/mobile Internet+, cloud computation and projects with potentials for
growth in relevant emerging industries of Shenzhen. In the report period, the industrial and commercial
registration of the fund management company has been completed (i.e. \"Shenzhen Hongtu SEG Investment
Management Co., Ltd.\"). As of today, the industrial and commercial registration of the fund limited partnership
(i.e. \"Shenzhen Hongtu SEG Intelligent Industrial Investment Fund (Limited Partnership)\") has been completed
and relevant registration and record formalities are in progress.
(5) SEG Intelligence
The Company established Suzhou SEG Intelligent Technology Co., Ltd. in January 2016, which is dedicated to
the business of intelligent home and focuses on creating one-stop purchasing and after-sale service platform of
intelligent home. SEG \"Dream Home\" intelligent home experience center, as the carrier of the platform, has
been fully integrated with the automatic control system, computer network system and network communication
technology, and can provide various networked intelligent home solutions and individual intelligent hardware for
families, projects and factories.
(6) Consumer Electronic Exhibition/Exchange Center (CEEC) Project
CEEC is jointly built by the Ministry of Industry and Information and Shenzhen City under a frame agreement. It
is designed to create a world-level consumer electronic exhibition/exchange center that integrates release of
high-end consumers' electronic products, display, user experience, investment and discussion, cooperation and
trade, based in Shenzhen, serving the whole country, and facing the world. On May 10, 2016, Shenzhen Futian
Investment Development Co., Ltd., Shum Yip Land Company Limited and Shenzhen SEG Co., Ltd. jointly
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
invested and established Shenzhen International Consumer Electronic Exhibition/Exchange Center Co., Ltd. The
project is linked with the industrial resources of North Huaqiang of Shenzhen with the construction area of
around 40,000 m2, with Shum Yip Shangcheng LOFT as the center. Currently it is in the period of attracting
investment.
(7) New energy business
The new energy market has high potentials, is environment-friendly and ecological, and is an industry
encouraged and supported by the government. Among all enterprises that are engaged in the CdTe solar energy
photovoltaic industry, Advanced Solar Power (Hangzhou) Co., Ltd., as an enterprise that possesses the CdTe film
cell component technology with completely independent intellectual property, is a technically leading enterprise
in the industry both at home and abroad. In May 2016, the Company invested and established \"Shenzhen SEG
Longyan New Energy Application and Development Co., Ltd\" jointly with Advanced Solar Power (Hangzhou)
Co., Ltd., Shenzhen Raytai Technology Photovoltaic Engineering Co., Ltd. and Shenzhen Energy Nanjing
Energy Holding Limited, to engage in the promotion of the integration of CdTe film PV power generation station,
building integrated photovoltaics (BIPV), integrated project contracting, and the sales of CdTe film solar cell
components. In the future, the SEG Longyan CdTe Film PV Industrial Park Project invested by the Company
will engage in the construction of CdTe film PV components production line and develop solar film cell industry.
The planned total investment of the project is RMB 570,989,900 and two production lines of CdTe film PV
components with the total production output of 80 MW will be built. The main products include standard PV
components and light transmitting components. The project is estimated to be finished and put into operation
within one year. The aforesaid two projects will become upstream and downstream businesses that facilitate each
other in operation. \"SEG Longyan Film Solar PV Project\" has finished relevant decision-making procedure and
the joint venture company SEG Longyan has been established. The project is planned to be located at Shenzhen
Shantou Cooperation Zone. Recently, SEG Longyan won the bid for the right to use the state-owned construction
land (lot No. E2016-0025) located at Ebu Town, Shenzhen-Shantou Special Cooperation Area at RMB
28,010,000, which will ensure the successful implementation of SEG Longyan's CdTe film photovoltaic project.
SEG Longyan will continue to promote environmental assessment and design of the park.
3. Orderly promoting commercial real estate business
Nantong SEG Times Plaza is opening and put into operation. Nantong SEG Times Plaza will combine the two
themes including technology and animation, and create two operation cores focusing on commerce and industrial
park. At the same time, Nantong SEG will increase income and reduce expenditures, trying to get supporting
funds.
On June 18, 2016, Nantong SEG Times Plaza Animation Industrial Park was opened. Now 16 animation
enterprises have signed contracts with a total area of 9,360 m2, accounting for 65.7% of the total area. Through
the operation of Animation Industrial Park, scale, production value and industrial influence of the enterprises that
enter Nantong Animation industrial Base will be improved continuously. On October 28, 2016, the commercial
part of Nantong SEG Times Plaza was opened. Through post-stage operation, customer flow, sales amount and
commercial influence will be improved continuously, so as to further enhance the brand value of SEG and the
market value of the skirt building properties.
(IV) Main problems for the business development of the Company
1. Some electronics market business, due to the issues including the cooperators, is in difficulty. The industry
is highly affected by the economic environment, and both rental income and market lease rate have decreased,
highlighting the difficulty in operation.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
2. The project of Nantong SEG Times Plaza has certain operational risks. Nantong SEG Times Plaza project
faces certain operation risks. Due to increase in the supply of Nantong real estate in the short term and serious
homogeneous competition, based on analysis of the present and future macro-environment of Nantong
commercial real estate, although Nantong SEG Project has entered the operation stage from the development and
construction state, it still faces huge challenges.
(V) Key tasks of the Company in 2017
Key tasks of the Company in 2017 include:
1. The Company will raise and utilize supporting funds for major assets restructuring.
2. After the completion of major assets restructuring, directed by the strategic development orientation, the
Company will accelerate effective integration of business, personnel, organization, capital, and information
resources, and develop the business model and management model compatible with the strategic
development platform after major assets restructuring.
3. The Company will accelerate the implementation of new projects, focus on CdTe film solar photovoltaic
projects, and develop strategic emerging industries; determine the construction land for \"SEG Longyan
Film Photovoltaic Industrial Park\", promote the design and construction of the park, and strive for
government support; accelerate the establishment and operation of Shenzhen Hongtu SEG Intelligent
Industrial Investment Fund, and give play to the active role of the fund.
4. The Company will rely on the current electronics market, closely combine the service advantages and
customers resources of the electronics market, expand the maker business, culture and education, intelligent
technology, sports, entertainment, virtual experience and e-sports, continuously deliver innovative
value-added services of the O2O electronics market with SEG characteristics, accelerate integration of the
physical electronics market and the Internet, develop new cooperation modes, create the Internet+ model
with SEG characteristics and intrinsic core value, and continuously strengthen its core competitiveness and
profitability.
5. The Company will promote the real estate development and operation of the industrial park, coordinate
resources, and accelerate the real estate construction, investment promotion, sales, and operation of the
industrial park.
6. The Company will further improve the basic management quality, strengthen standard operation, and duly
perform the information disclosure obligation as a listed company; strengthen communication with
investors and potential investors, enhance the investors' understanding and identification with the Company,
carry out investor relationship management from multiple channels and at multiple levels, duly guarantee
the legal rights and interests of investors, particularly small and medium-sized investors, further strengthen
overall risk management and the construction and implementation of the internal control system, strengthen
the responsibility of risk subjects, improve the decision-making awareness, further improve the risk control
system, and carry out risk assessment throughout the lifecycle of major investment projects.
7. The Company will strengthen system innovation and the construction of the talent team, carry out the pilot
program on investing enterprises, and establish and improve the incentive system suitable for the Company
together with major assets restructuring. The Company will promote innovation in human resources
management, talent cultivation, and talent pool, particularly talent incentives.
(VI) Risk warning
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
The future development planning and investment plan mentioned above do not reflect the profit estimation of
2017 by the Company. The results depend on multiple factors such as changes in market condition, efforts of the
operation team, and approval of relevant authority departments and uncertainties exist. Investors shall pay
special attention to it.
X. Statement of receipt of surveys, communication and visits
1. Registration form for investigations, communication and Interviews in the report period
√ Applicable □ Not applicable
Time Means Type Basic information on investigation
Inquire about the progress of major assets restructuring. The
January 4, 2016 Phone call Individual Company has given a reply according to the actual progress
disclosed.
Inquire about the progress of major assets restructuring. The
January 7, 2016 Phone call Individual Company has given a reply according to the actual progress
disclosed.
Inquire about the progress of major assets restructuring. The
January 8, 2016 Phone call Individual Company has given a reply according to the actual progress
disclosed.
Inquire about the progress of major assets restructuring. The
February 1, 2016 Phone call Individual Company has given a reply according to the actual progress
disclosed.
Inquire about the progress of major assets restructuring. The
February 2, 2016 Phone call Individual Company has given a reply according to the actual progress
disclosed.
Inquire about the reply to the Letter of Inquiry about the
Restructuring of Shenzhen SEG Co., Ltd. issued by Shenzhen
Stock Exchange. The Company has replied that it has arranged
February 19, 2016 Phone call Individual agencies for studying, verifying and replying to relevant issues
and investors may pay attention to the upcoming
announcement of the Company.
Inquire about the reply to the Letter of Inquiry about the
Restructuring of Shenzhen SEG Co., Ltd. issued by Shenzhen
Stock Exchange. The Company has replied that it has arranged
February 20, 2016 Phone call Individual agencies for studying, verifying and replying to relevant issues
and investors may pay attention to the upcoming
announcement of the Company.
Inquire when the Company will resume trading. The Company
February 22, 2016 Phone call Individual has given a reply according to the actual progress disclosed.
Inquire about when the Company will resume trading. The
February 23, 2016 Phone call Individual Company has given a reply according to the actual progress
disclosed.
Inquire about asset injection in major assets restructuring. The
February 25, 2016 Phone call Individual Company has given a reply according to the major assets
restructuring plan disclosed.
Inquire why stocks of the Company have not risen after
resumption and whether there is any important announcement
February 26, 2016 Phone call Individual to be disclosed. The Company has replied that there is no
information which shall be disclosed but not disclosed.
Inquire why stocks of the Company have not risen after
resumption and whether there is any important announcement
February 27, 2016 Phone call Individual to be disclosed. The Company has replied that there is no
information which shall be disclosed but not disclosed.
Inquire about the number of shareholders as of February 29.
March 1, 2016 Phone call Individual The Company has given a reply according to the register of
shareholders released by the Securities Depository and
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Time Means Type Basic information on investigation
Clearing Corporation.
Inquire about the number of shareholders as of March 15. The
Company has given a reply according to the register of
March 15, 2016 Phone call Individual shareholders released by the Securities Depository and
Clearing Corporation.
Inquire when the Company will disclose the annual report.
March 22, 2016 Phone call Individual The Company has replied that the annual report will be
disclosed on March 30, 2016.
Inquire about the financial data of Q1. The Company asked
March 31, 2016 Phone call Individual investors to pay attention to 2016 Q1 report of the Company to
be disclosed.
Inquire about asset injection in major assets restructuring. The
April 20, 2016 Phone call Individual Company has given a reply according to the major assets
restructuring plan disclosed.
Inquire about the number of shareholders as of April 29. The
Company has given a reply according to the register of
April 30, 2016 Phone call Individual shareholders released by the Securities Depository and
Clearing Corporation.
Inquire about the progress of major assets restructuring. The
May 19, 2016 Phone call Individual Company has given a reply according to the actual progress
disclosed.
Inquire about the number of shareholders as of June 15. The
Company has given a reply according to the register of
June 15, 2016 Phone call Individual shareholders released by the Securities Depository and
Clearing Corporation.
Inquire about the financial data of Q1. The Company asked
June 30, 2016 Phone call Institution investors to pay attention to 2016 semi-annual report of the
Company to be disclosed.
Inquire about the progress of major assets restructuring. The
July 6, 2016 Phone call Individual Company has given a reply according to the actual progress
disclosed.
Inquire about the progress of major assets restructuring. The
July 14, 2016 Phone call Individual Company has given a reply according to the actual progress
disclosed.
Inquire about the progress of major assets restructuring. The
July 27, 2016 Phone call Individual Company has given a reply according to the actual progress
disclosed.
Inquire about asset injection in major assets restructuring. The
August 9, 2016 Phone call Individual Company has given a reply according to the major assets
restructuring plan disclosed.
Inquire about the number of shareholders as of August 15. The
Company has given a reply according to the register of
August 18, 2016 Phone call Individual shareholders released by the Securities Depository and
Clearing Corporation.
Inquire about the progress of major assets restructuring. The
August 23, 2016 Phone call Individual Company has given a reply according to the actual progress
disclosed.
Inquire about the number of shareholders as of August 30. The
Company has given a reply according to the register of
August 31, 2016 Phone call Individual shareholders released by the Securities Depository and
Clearing Corporation.
Inquire about voting results of the general meeting of the
September 1, 2016 Phone call Individual Company. The Company has given a reply according to the
disclosed notice of the general meeting.
Inquire about the progress of major assets restructuring. The
September 7, 2016 Phone call Individual Company has given a reply according to the actual progress
disclosed.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Time Means Type Basic information on investigation
Inquire about the approval progress of the CSRC on major
September 19, 2016 Phone call Individual assets restructuring. The Company has given a reply according
to the actual progress disclosed.
Inquire about the main business, transformation, and private
September 21, 2016 Phone call Individual placement of the Company. For details, see the disclosure on
irm.cninfo.com.cn.
Inquire about the main business, transformation, and private
September 28, 2016 Phone call Individual placement of the Company. For details, see the disclosure on
irm.cninfo.com.cn.
Inquire about the financial data of Q3. The Company asked
October 8, 2016 Phone call Individual investors to pay attention to 2016 Q3 report of the Company to
be disclosed.
Inquire about the approval progress of the CSRC on major
October 16, 2016 Phone call Individual assets restructuring. The Company has given a reply according
to the actual progress disclosed.
Inquire about the Company's sales of the equity of Huakong
October 27, 2016 Phone call Individual SEG. The Company has given a reply according to the
announcement disclosed.
Inquire about the Company's sales of the equity of Huakong
October 28, 2016 Phone call Individual SEG. The Company has given a reply according to the
announcement disclosed.
Inquire about the number of shareholders as of October 31.
The Company has given a reply according to the register of
November 3, 2016 Phone call Individual shareholders released by the Securities Depository and
Clearing Corporation.
Inquire about issues related to the CdTe film photovoltaic
November 15, 2016 Phone call Individual industrial base project. The Company has given a reply
according to the announcement disclosed.
Inquire about the review reply of the M&A and Restructuring
Review Committee of the CSRC on major assets restructuring.
November 18, 2016 Phone call Individual The Company has given a reply according to the actual
progress disclosed.
Inquire about issues related to the CdTe film photovoltaic
November 25, 2016 Phone call Individual industrial base project. The Company has given a reply
according to the actual progress disclosed.
Inquire about the progress of the Company's transfer of the
November 30, 2016 Phone call Individual equity of SEG E-commerce. The Company has given a reply
according to the announcement disclosed.
Inquire about the number of shareholders as of November 30.
The Company has given a reply according to the register of
December 2, 2016 Phone call Individual shareholders released by the Securities Depository and
Clearing Corporation.
Inquire about the progress of the Company's sales of shares of
Huakong SEG. The Company asked investors to pay attention
December 9, 2016 Phone call Individual to the progress report disclosed in the designated information
disclosure media.
Inquire about the operating result of Q4. The Company asked
December 16, 2016 Phone call Individual investors to pay attention to 2016 annual report of the
Company to be disclosed.
Inquire about the progress of the Company's sales of shares of
Huakong SEG. The Company asked investors to pay attention
December 20, 2016 Phone call Individual to the progress report disclosed in the designated information
disclosure media.
Inquire whether Company has obtained the approval of the
December 22, 2016 Phone call Individual CSRC on major assets restructuring. The Company asked
investors to pay attention to real-time announcements.
Inquire whether Company has obtained the approval of the
December 29, 2016 Phone call Individual CSRC on major assets restructuring. The Company asked
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Time Means Type Basic information on investigation
investors to pay attention to real-time announcements.
Frequency of reception
Number of institutions received
Number of individuals received
Number of other objects received
Is there any important information
No
disclosed?
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Chapter 5 Important Matters
I. Plan of common share profit distribution and plan of transfer of capital reserves into share
capital
Information on the establishment, implementation or adjustment of the ordinary share profit distribution policy,
especially the cash dividend policy:
√ Applicable □ Not applicable
(I) Information on the establishment, implementation or adjustment of the profit distribution policy:
According to the Articles of Association and Shareholder Return Plan for the Next Three Years (2015-2017), the
Annual Profit Distribution Plan of 2015 was formulated by the Company in 2016 and passed by the Board of
Directors and general meeting. The statutory surplus reserve was RMB 7,009,501.20, accrued at 10% of the
profit available for distribution. Based on 784,799,010 share capital of the Company as of December 31, 2015,
the cash dividends were distributed to all shareholders at 0.30 yuan (tax included) for every 10 shares. The total
amount of profit distribution of the Company was RMB 23,543,970.30, in which cash dividends accounted for
100%. The Company did not transfer reserves into share capital. The annual profit distribution plan of 2015 was
completed on June 16, 2016.
Special explanation of cash dividend policy
Does it comply with the Article of Association of the Company
Yes
or the resolutions of the meeting of shareholders?
Are the dividend standard and ratio explicit and clear? Yes
Are the decision-making procedure and mechanism perfect? Yes
Do independent directors fulfill their obligations and play their
Yes
role?
Is there any channel for medium and small shareholders to fully
express themselves? Are their legitimate rights and interests fully Yes
protected?
Are the conditions and procedure for adjustment or change of
Yes
cash dividend policy compliant and transparent?
Information on ordinary share profit distribution (proposal) and the plan of transfer of capital reserves into share
capital (proposal) in the recent three years (including the report period)
Pursuant to the Accounting Standard for Business Enterprise 2014, the investment in subsidiaries by the
Company was calculated based on the basis of cost method, the profit of parent company remained bigger
differences with consolidated profit. In accordance with relevant provisions of the Company Law, the profit
distribution was implemented with the parent company as the main body. Therefore, the profit distribution of the
Company in 2014, 2015 and 2016 was implemented depending on the distributable profit of the parent company.
1. Profit distribution proposal and the proposal for transfer of capital reserves into share capital in 2016:
According to auditing by Da Hua Certified Public Accountants Co., Ltd., the net profit attributable to the listed
company realized by the parent company in 2016 amounted to RMB 118,807,033.67, the undistributed profit at
the beginning of the year is RMB 63,085,510.75, and the current profit available for distribution to shareholders
was RMB 181,892,544.42. According to the Articles of Association and Shareholder Return Plan for the Next
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Three Years (2015-2017), the annual profit distribution plan of 2016 is as follows: The statutory surplus reserve
was 11,880,703.37, accrued at 10% of the achieved net profit of the current year; the other profit available for
distribution to shareholders was RMB 146,342,426.58. The Company decided not to distribute the profit nor
transfer reserves into share capital in 2016. The Company intends to distribute the profit properly after the
business of raising supporting funds is completed.
2. Profit distribution proposal and the proposal for transfer of capital reserves into share capital in 2015:
According to auditing by Da Hua Certified Public Accountants Co., Ltd., the net profit attributable to the listed
company realized by the parent company in 2015 amounted to RMB 92,305,001.57, the undistributed profit at
the beginning of the year is RMB -22,209,989.62, and the current profit available for distribution to shareholders
was RMB 70,095,011.95. The annual profit distribution plan of 2015 was as follows: The statutory surplus
reserve was RMB 7,009,501.20, accrued at 10% of the profit available for distribution. Based on 784,799,010
share capital of the Company as of December 31, 2015, the cash dividends were distributed to all shareholders at
0.30 yuan (tax included) for every 10 shares. The total amount of profit distribution of the Company in 2015 was
RMB 23,543,970.30, in which cash dividends accounted for 100%. The Company did not transfer reserves into
share capital.
3. Profit distribution proposal and the proposal for transfer of capital reserves into share capital in 2014:
According to auditing by Da Hua Certified Public Accountants Co., Ltd., the net profit attributable to the listed
company realized by the parent company in 2014 amounted to RMB 32,887,973.01, the undistributed profit at
the beginning of the year is RMB -55,097,962.63, and the current profit available for distribution to shareholders
was RMB -22,209,989.62. The Company decided not to distribute the profit nor transfer capital reserves into
share capital.
Table of distribution of ordinary share cash dividends by the Company in the recent three years (including the
report period)
Unit: Yuan
Net profit
Ratio of net profit
attributable to
attributable to
ordinary
ordinary Amount of cash Percentage of cash
Year for bonus Amount of cash shareholders of
shareholders of dividends otherwise dividends otherwise
distribution bonus (incl. tax) listed company in
listed company in distributed distributed
consolidated
consolidated
statement of bonus
statement (%)
year
2016 0.00 107,560,213.41 0.00% 0.00 0.00%
2015 23,543,970.30 74,242,090.49 31.71% 0.00 0.00%
2014 0.00 48,380,294.05 0.00% 0.00 0.00%
The net profit of the Company was positive and the profit of the parent company to be distributed to ordinary
shareholders was also positive, but the proposal for distribution of cash dividends was not put forward.
√ Applicable □ Not applicable
Reason for no common share cash dividend distribution proposal
despite positive net profit and positive profit of the parent
Purpose and usage plan of the undistributed profit
company available for distribution to common shareholders in
the report period
As the Company has obtained the approval of the CSRC for The Company intends to distribute the profit after the business of
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
issuing shares to acquire assets and raise supporting funds, the raising supporting funds is completed.
release of the supporting fund is in progress. According to terms
of Article 18 of the Measures for the Administration of the
Offering and Underwriting of Securities (Order No. 121 of the
China Securities Regulatory Commission), if the profit
distribution plan and the plan of transferring reserves into share
capital are not submitted to the general meeting for voting or
passed by the general meeting but not implemented, the listed
company shall issue securities only after such plans are
implemented. In view of long-term development, shareholders'
interests, and the validity term of the approval for major assets
restructuring, the Company decides not to distribute the profit in
2016 nor transfer reserves into share capital.
II. Plan of profit distribution and plan of transfer of capital reserves into share capital in the
report period
□ Applicable √ Not applicable
The Company plans not to distribute cash dividends or bonus shares nor transfer reserves into share capital.
III. Fulfillment of Commitments
1. Commitments fulfilled in the report period or yet to be fulfilled as of the end of the report period by the
Company, shareholders, actual controllers, purchaser, directors, supervisors, senior executives or other
associates
√ Applicable □ Not applicable
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Commitment Commitment
Commitments Subject Type Content Performance
date term
Commitment for share
Not applicable
reform
\"1. The Company undertakes that as of October 31, 2015, controlling shareholders of
Shenzhen SEG or other related persons who occupy funds of Shenzhen SEG or the
subject company due to non-operating events will repay them before the shareholders'
meeting that is intended to review the restructuring plan;
2. After restructuring, the financial independence of the listed companies shall be
guaranteed and no illegal occupation of funds of listed companies will occur;
3. The Company will abide by and urge listed companies to abide by relevant laws and
administrative regulations such as the Code on Corporate Governance of Listed
Companies, the Notice on Regulating the Funds Transfers between Listed Companies and
Related Parties and the External Guarantee of Listed Companies, and the Listing Rules of
Shenzhen Stock Exchange, regulations, regulatory documents, and Shenzhen Stock
Commitment on Exchange business rules, and improve awareness of compliance;
horizontal
Shenzhen SEG competition, 4. The Company will exercise the rights of shareholders according to law, and will not August 3,
abuse the rights of shareholders to damage the interests of listed companies and other 2016 Long-term In progress
Group Co., Ltd. related
transaction, and shareholders;
capital occupation 5. The Company will optimize the governance structure of listed companies, improve the
Commitments in the internal control system, regulate the operation of the three organs, give full play to
Acquisition Report and functions and supervisory role of independent directors and the Board of Supervisors, and
the Report of Changes restrict decision-making and operation by controlling shareholders and actual controllers
on Equity of the Company;
6. The Company will fulfill the obligation of information disclosure strictly in accordance
with relevant provisions, actively cooperate with listed companies on information
disclosure, timely inform major events incurred or to be incurred, and ensure the
authenticity, accuracy, integrity, timeliness and fairness of information disclosure. In case
of breach of the foregoing commitments, the Company will bear all losses thus incurred
to Shenzhen SEG, the subject company, other companies, enterprises, or other economic
organizations controlled by the Company.\"
\"1. When the Company acts as the controlling shareholder of Shenzhen SEG, the
Company, other companies, enterprises, or other economic organizations controlled by the
Commitment on Company, will minimize and regulate associated transactions with Shenzhen SEG or the
horizontal subject company, other companies, enterprises, or other economic organizations
Shenzhen SEG competition, controlled by the Company. August 3, In normal
Long-term
Group Co., Ltd. related 2. When the restructuring is completed, the Company, other companies, enterprises, or 2016 progress
transaction, and other economic organizations controlled by the Company will handle associated
capital occupation transactions with Shenzhen SEG or the subject company that are unavoidable or incurred
for reasonable cause at fair and reasonable market price, perform the decision-making
procedure for associated transactions according to relevant laws, regulations, and
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
normative documents, fulfill the obligation of information disclosure and handle the
approval procedures according to the law, do not use the dominant position of the
controlling shareholder to damage the legal rights and interests of Shenzhen SEG and
other shareholders.
3. The Company, other companies, enterprises, or other economic organizations
controlled by the Company will not use the rights of shareholders of the listed company
or the actual control ability to manipulate or instruct the listed company or its directors,
supervisors and senior executives to have the listed company unfairly provide or accept
funds, goods, services or other assets, or engage in any acts detrimental to the interests of
listed companies. In case of breach of the following commitments, the Company will bear
all losses thus incurred to Shenzhen SEG, the subject company, other companies,
enterprises, or other economic organizations controlled by the Company.\"
\"1. In the restructuring, relevant assets such as some commercial electronics markets of
SEG Group that constitute the horizontal competition have not been injected into the
listed company. SEG Group will trust such assets to Shenzhen SEG or its subsidiaries
after the major asset restructuring. Within 5 years after the major asset restructuring, SEG
Group will take all necessary measures to solve flaws of such assets, and incorporate the
preceding specialized electronics markets that constitute horizontal competition into
Shenzhen SEG or transfer them to the third party in a feasible way such as sales based on
operating needs of Shenzhen SEG and the completeness of the ownership of such assets.
If SEG Group fails to complete the foregoing matters as scheduled, before injecting
relevant assets to Shenzhen SEG, SEG Group shall lease them to Shenzhen SEG for direct
operation and enjoy the income from such property. The annual rent of Shenzhen SEG is
the depreciated value of such property. Profit and loss incurred by leasing of such
property assets shall be shared by Shenzhen SEG. The parties shall separately enter into a
Commitment on leasing agreement.
horizontal 2. Except assets owned and business operated before the validity date of commitment,
Shenzhen SEG competition, when acting as a controlling shareholder or actual controller of Shenzhen SEG, in order to August 03, In normal
Long-term
Group Co., Ltd. related guarantee sustainable development of Shenzhen SEG, the Company will exercise 2016 progress
transaction, and supervision and restriction on operating activities of its own and affiliated enterprises
capital occupation under its control, will not establish new or acquire any assets or business same as or
similar to its main business within the operation area of Shenzhen SEG, and will not be
engaged in any activities that may damage the interests of Shenzhen SEG and other
companies and enterprises controlled by Shenzhen SEG, or other economic organizations.
If in the future there is any business opportunity same as or similar to other main business
within Shenzhen SEG operation area, such opportunity will preferentially be
recommended to Shenzhen SEG and other companies and enterprises controlled by
Shenzhen SEG, or other economic organizations. However, any of the following cases is
an exception: (1) Due to national laws, regulations and policies and other reasons, any
commercial properties and real estate development projects appropriated or allocated
through oriented protocols by the government to SEG Group and any enterprises invested
by it; or (2) when the general conditions of tender, transfer or assignment of specific
commercial properties and real estate development projects have specific requirements on
the bidder or assignee, Shenzhen SEG is not qualified y but SEG Group is qualified.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Commercial property and real estate development projects that are same as the main
business of Shenzhen SEG or result in horizontal competition subject to the above
exclusions may be invested and built by SEG Group at first. If Shenzhen SEG thinks that
such assets are eligible to be injected into Shenzhen SEG, upon receipt of the written
acquisition notice from Shenzhen SEG, SEG Group will negotiate on acquisition and
transfer such projects to Shenzhen SEG. In case of breach of the foregoing commitments,
the Company will bear all losses thus incurred to Shenzhen SEG, the subject company,
other companies, enterprises, or other economic organizations controlled by the
Company.\"
\"1. The Company will guarantee the independence of personnel of Shenzhen SEG and
subject company: (1) After completion of the restructuring, the labor, personnel and
compensation management of Shenzhen SEG are independent from the Company and
related parties, such as other companies, enterprises, or other economic organizations
controlled by the Company. (2) After completion of the restructuring, senior executives of
Shenzhen SEG and the subject company hold full-time position at Shenzhen SEG and the
subject company and receive compensation, and will not assume any duties other than
director and supervisor in the Company and related parties, such as other companies,
enterprises, or other economic organizations controlled by the Company. (3) After
completion of the restructuring, the Company will not interfere with the shareholders'
meeting and the Board of Directors' exercise of power in appointment/dismissal of
personnel.
2. The Company will guarantee the independence of organs of Shenzhen SEG and the
subject company: (1) After completion of the restructuring, Shenzhen SEG and the
subject company will develop a sound corporate governance structure and an independent
and complete organizational structure. (2) After completion of the restructuring, the
shareholders' meeting, the Board of Directors, and the Board of Supervisors of Shenzhen
Shenzhen SEG August 3, In normal
Other commitment SEG and the subject company will exercise duties and powers according to laws, Long-term
Group Co., Ltd. 2016 progress
regulations and articles of association of Shenzhen SEG and the subject company.
3. The Company will guarantee the independence and completeness of Shenzhen SEG
and the subject company: (1) After completion of the restructuring, Shenzhen SEG and
the subject company will have independent and complete assets related to production and
management. (2) After completion of the restructuring, the site for business operation of
Shenzhen SEG and the subject company are independent of the Company and related
parties, such as other companies, enterprises, or other economic organizations controlled
by the Company. (3) After completion of the restructuring, except normal operational
contacts, Shenzhen SEG and the subject company are not involved in the following case:
funds or assets are occupied by the Company and related parties, such as other companies,
enterprises, or other economic organizations controlled by the Company.
4. The Company will guarantee the business independence of Shenzhen SEG and the
subject company: (1) After completion of the restructuring, Shenzhen SEG and the
subject company own relevant qualification for independent business operation, and have
the independent and sustainable market-oriented operation capability. (2) Except assets
owned and business operated before the validity date of commitment, when acting as a
controlling shareholder of Shenzhen SEG, in order to guarantee sustainable development
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
of Shenzhen SEG, the Company will exercise supervision and restriction on operating
activities of its own and the affiliated enterprises under its control, will not establish new
or acquire any assets or businesses same as or similar to its main business within the
operation area of Shenzhen SEG, and will also not be engaged in any activities which may
damage the interests of Shenzhen SEG and other companies, enterprises, or other
economic organizations controlled by Shenzhen SEG. If in the future there is any business
opportunity same as or similar to other main business within Shenzhen SEG operation
area, such opportunity will be preferentially recommended to Shenzhen SEG and other
companies, enterprises, or other economic organizations controlled by Shenzhen SEG. (1)
Due to national laws, regulations and policies and other reasons, any commercial
properties and real estate development projects appropriated or allocated through oriented
protocols by the government to SEG Group and any enterprises invested by it; or (2)
When the general conditions of tender, transfer or assignment of specific commercial
properties and real estate development projects have specific requirements on the bidder
or assignee, Shenzhen SEG is not qualified but SEG Group is qualified. Commercial
property and real estate development projects that are same as the main business of
Shenzhen SEG or result in horizontal competition subject to the above exclusions may be
invested and built by SEG Group at first. If Shenzhen SEG thinks that such assets are
eligible to be injected into Shenzhen SEG, upon receipt of the written acquisition notice
from Shenzhen SEG, SEG Group will negotiate on acquisition and transfer such projects
to Shenzhen SEG. (3) After completion of the restructuring, the Company and related
parties, such as other companies, enterprises, or other economic organizations controlled
by the Company will reduce related transactions with Shenzhen SEG and the subject
company and other companies, enterprises, or other economic organizations controlled by
them; for any related transactions that are indeed necessary and unavoidable, the
Company will handle them at fair price based on the market principle, and fulfill relevant
approval procedures and the information disclosure obligation according to provisions of
relevant laws, regulations and normative documents.
5. The Company will guarantee the financial independence of Shenzhen SEG and the
subject company: (1) After completion of the restructuring, Shenzhen SEG and the
subject company will establish an independent financial department, independent
financial accounting system, and standard and independent financial accounting rules. (2)
After completion of the restructuring, Shenzhen SEG and the subject company will
separately open an account in banks, and do not share accounts with the Company and
related parties, such as other companies, enterprises, or other economic organizations
controlled by the Company. (3) After completion of the restructuring, financial personnel
of Shenzhen SEG and the subject company will not hold a part-time job in the Company
or related parties, such as other companies, enterprises, or other economic organizations
controlled by the Company. (4) After completion of the restructuring, Shenzhen SEG and
the subject company will independently make financial decisions, and the Company will
not interfere with fund usage of Shenzhen SEG and the subject company. (5) After
completion of the restructuring, Shenzhen SEG and the subject company will pay taxes
independently according to laws. In case of breach of the foregoing commitments, the
Company will bear all losses thus incurred to Shenzhen SEG, and the subject company.\"
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
\"(I) Contract subjects and date of signing
Shenzhen SEG and SEG Group signed Performance Commitment and Compensation
Agreement on August 3, 2016.
(II) Performance commitment period
3 accounting periods following the completion of the transaction (including the year of
completion and the following consecutive two accounting periods). If the transaction is
completed before December 31, 2016 (included), the performance commitment period
includes 2016, 2017, and 2018. If the transaction is completed between December 31,
2016 and December 31, 2017 (included), the performance commitment period includes
2017, 2018, and 2019. After the completion of the transaction, Shenzhen SEG shall hire
an accounting firm with the qualification of securities that is recognized by SEG Group
within 4 months after the end of each accounting period during the performance
commitment period to respectively issue a special audit report and/or an impairment test
report (hereinafter referred to as the \"special audit report\") with respect to the promised
net profit/promised cash flow income/promised development profit (hereinafter
collectively referred to as \"promised performance\") related to assets within the transaction Three
compensation scope agreed in the agreement, and recognize the promised performance or accounting
impairment of assets within the transaction compensation scope in each year during the years from
performance commitment period. the year of
completion
(III) Performance commitment and performance compensation of
Commitments made at Underlying assets injected into Shenzhen SEG in this transaction are subject to multiple restructuring
the time of Shenzhen SEG Performance appraisal methods: 100% of the equity of SegMaker, 55% of the equity of SEG Kangle, August 3, In normal
(including
restructuring of major Group Co., Ltd. Commitment and 79.02% of the equity of SEG Property Investment are priced on the basis of appraisal 2016 progress
the year of
assets conclusion with the asset-based method, in which property assets are subject to the completion
income method and market method and real estate development in the long-term equity and the
investment is subject to the hypothetical development method; 100% of the equity of SEG subsequent
Property Development and 100% of the equity of SEG Property Management (a two
wholly-owned subsidiary of SEG Property Investment) are subject to the income method. accounting
Therefore, all parties recognize and agree that the performance guarantee of relevant years)
underlying assets of the transaction and the compensation methods shall be carried out
according to the following stipulations:
1. Performance guarantee of underlying assets appraised by income approach and
performance compensation
(1) If the transaction is completed before December 31, 2016 (included), SEG Group
warrants that: 1) Audited net profits of SEG Property Development after the deduction of
non-recurring profits and losses and investment income of 2016, 2017 and 2018
respectively (hereinafter referred to as \"guaranteed net profits\") shall not be lower than
RMB 8.05 million, RMB 7.85 million and RMB 7.75 million respectively; 2) The
guaranteed net profits of SEG Property Management of 2016, 2017 and 2018 shall not be
lower than RMB 4,05 million, RMB 3.45 million and RMB 3.6 million respectively; 3)
The net profits attributable to the parent company (net profits attributable to the parent
company = shareholding percentage of parent company x [income actually realized by
corresponding property assets (including the income of new area after renovation of
property assets)-depreciation and amortization of the cost of renovation-direct cost and
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
management costs (including urban property tax, business tax, urban construction tax and
education surtax, stamp duty, maintenance tax, insurance premium and land use tax,
excluding depreciation and amortization)-relevant losses caused by renovation (if
any)-other operating costs and taxes of corresponding properties (including income tax)],
hereinafter referred to as \"guaranteed net profits\") of the property assets (minus the parts
used by the companies) of SegMaker, SEG Kangle and SEG Real Estate of 2016, 2017
and 2018 appraised by income approach shall not be lower than RMB 63,013,500, RMB
59,995,800 and RMB 77,627,200 respectively.
(2) If the transaction is completed after December 31, 2016 and before December 31,
2017 (included), SEG Group warrants that: 1) Guaranteed net profits of SEG Property
Development of 2017, 2018 and 2019 respectively shall not be lower than RMB 7.85
million, RMB 7.75 million and RMB 7.75 million respectively; 2) The guaranteed net
profits of SEG Property Management of 2017, 2018 and 2019 shall not be lower than
RMB 3.45 million, RMB 3.60 million and RMB 3.75 million respectively; 3) The
guaranteed net profits corresponding to the property assets (minus the parts used by the
companies) of 2017, 2018 and 2019 as appraised by income approach of SegMaker, SEG
Kangle and SEG Real Estate shall not be lower than RMB 59,995,800, RMB 77,627,200
and RMB 94,723,100 respectively.
(3) If the actual net profits on the foregoing assets appraised by income approach after
accumulative deduction of non-operating profits and losses as of the end of any year
during the performance guaranteed period are lower than the accumulatively guaranteed
net profits of corresponding assets as of the end of such year, SEG Group shall use Shen
SEG shares obtained by acquisition of relevant assets as the consideration to make
compensation for Shenzhen SEG in terms of the shares issued to SEG Group according to
the following calculation method. For the part not covered by shares, SEG Group shall
compensate in cash: 1) to compensate 100% of the equity of SEG Property Development
and 100% of the equity of SEG Property Management appraised by income approach: I.
Number of shares to be compensated every year = (accumulated guaranteed net profits as
of the end of the current period -actually accumulated net profits as of the end of the
current period)/total guaranteed net profits of years during the compensation period x total
subscribed shares-amount of compensated shares. Remarks: The \"total subscribed shares\"
refers to the total number of shares obtained by SEG Group by subscribing all shares
issued by Shenzhen SEG at 100% of the equity of SEG Property Development and 100%
of the equity of SEG Property Management appraised, i.e. total subscribed shares = 100%
of the equity of SEG Property Development or 100% of the equity of SEG Property
Management as the overall price/offering price of the shares issued this time to purchase
assets. When the number of shares of Shenzhen SEG is calculated by 100% of the equity
of SEG Property Management, the impact of the 79.02% of the equity of SEG Real Estate
(the parent company of SEG Property Management) held by SEG Group should be taken
into consideration. II. The part not covered by shares will be compensated by SEG Group
in cash. Amount of extra cash to be compensated = number of shares not covered x
offering price of the shares issued this time to purchase assets.
2) Compensation of property assets held by all target companies appraised by income
approach
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
I. Number of shares to be compensated every year = (accumulated guaranteed net
profits as of the end of the current period -actually accumulated net profits as of the end
of the current period)/total guaranteed net profits of years during the compensation period
x total subscribed shares-amount of compensated shares. Remarks: The \"total subscribed
shares\" in the foregoing formula refers to the total number of shares obtained by SEG
Group by subscribing all shares issued by Shenzhen SEG at the price of the property
assets (including the property assets appraised by income approach and are held by
SegMaker, SEG Kangle and SEG Real Estate) appraised by income approach, i.e. total
subscribed shares = appraised price of the property assets appraised by all target
companies with income approach/the offering price of the shares issued this time to
purchase assets. When the number of shares of Shenzhen SEG is calculated, the impact of
the percentages of share rights of all target companies held by SEG Group shall be taken
into consideration. II. The part not covered by shares will be compensated by SEG Group
in cash. Amount of extra cash to be compensated = number of shares not covered x
offering price of the shares issued this time to purchase assets.
(4) When the performance guaranteed period expires, Shenzhen SEG shall hire the
Certified Public Accountants with securities practice qualification recognized by both
parties to carry out impairment test on the foregoing assets appraised by income approach
and issue the impairment test report. If the impairment amount at the end of the current
period of the assets appraised by income approach is greater than the total number of
shares compensated during the performance guaranteed period x offering price of the
shares issued this time to purchase assets + total amount of cash compensated, SEG
Group shall make compensation for the impaired part of such assets of Shenzhen SEG: 1)
Number of shares compensated for the impaired part of the assets appraised by income
approach = impairment amount at the end of the current period of the underlying assets
appraised by income approach/offering price of the shares issued this time - total shares
already compensated during the performance guaranteed period. 2) The part not covered
by shares will be compensated by SEG Group in cash. Amount of extra cash to be
compensated = number of shares not covered x offering price of the shares issued this
time to purchase assets.
(5) Under any circumstances, the total number of shares compensated arising from the
actual net profits less than the guaranteed net profits and the impairment test in total shall
be limited to the total number of Shen SEG shares (including share increase by transfer
and stock dividends) obtained by subscription with 100% of the equity of SEG Property
Development, 100% of the equity of SEG Property Management and property assets of
target companies appraised by SEG Group with income approach. The part not covered
will be compensated in cash by SEG Group, which is limited to the cash consideration
paid for Shen SEG shares with such assets.
2. Performance guarantee of underlying assets appraised by hypothetical development
method and performance compensation
(1) SEG Group warrants that the actual development profits (hereinafter referred to as
\"guaranteed development profits\") of SEG ECO Phase I Project, Shenzhen SEG
International Electronics Industry Center Project of Shenzhen SEG New City
Construction and Development Co., Ltd. (hereinafter referred to as \"SEG New City
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Development\"), Xi'an SEG Plaza Project of Xi'an SEG (subsidiary of SEG Real Estate),
and the remaining building of Oriental Venice Project and SEG Holiday Plaza Project of
Huizhou Stars Real Estate Development Co., Ltd. (subsidiary of SEG Real Estate) shall
not be lower than RMB 104,007,500, RMB 449,494,900, RMB 661,619,900, RMB
18,501,000 and RMB 154,605,400 respectively.
(2) The compensation period of the transaction is three fiscal years from the year of
completion of the transaction (included). When the restructuring compensation period
expires, Shenzhen SEG shall hire the Certified Public Accountant with securities practice
qualification recognized by both parties to carry out auditing on the realized profits of the
foregoing real estate projects appraised by hypothetical development method (including
the development profits realized in the transitional period) and unrealized development
profits (if any), and issue special audit reports respectively. If, during the period from the
appraisal base date to the expiry date of the three-year guaranteed period, the achieved
sales area of the real estate projects under the underlying assets (hereinafter referred to the
\"achieved sales area\") fails to reach 90% of the remaining sellable area as of the appraisal
base date or the sellable area after completion, SEG Group agrees to extend the
performance guaranteed period of the real estate projects appraised by hypothetical
development method to the end of the year when the achieved sales area reaches 90% (i.e.
December 31 of that year). All the real estate projects appraised by hypothetical
development method shall be subject to the foregoing stipulations separately. During the
transaction compensation period, the amount of the capital raised this time with impact
shall be deducted from realized and unrealized development profits (if any) of the real
estate projects appraised by hypothetical development method, the calculation formula of
the amount of the supporting capital raised this time with impact is as below: amount of
the supporting capital raised this time with impact on the performance guarantee =
amount of the supporting capital raised this time actually used in funded projects x
interest of loan from the bank of corresponding period x (1 - income tax rate of the
implementation subject of implementation of the funded projects) x actual days of capital
use/365, in which the interest of loan from the bank of corresponding period shall be
determined by the interest rate of loan of 1 to 3 years of the People's Bank of China of the
corresponding period of the actual operation plus 20% extra, and the actual days of use of
the capital raised shall be calculated by the natural days during the period from the date
on which the raised capital is provided to the implementation subject of the funded project
till the earlier one of the expiry date of the compensation period and the date on which
relevant capital is repaid to the listed company. If the total amount of the realized
development profits and the unrealized development profits (if any) of such real estate
projects is lower than the guaranteed development profits, SEG Group shall compensate
Shenzhen SEG with the shares used by Shenzhen SEG as payment consideration acquired
from relevant project subscription according to the following calculation method, and
SEG Group shall compensate in cash the part not covered by shares: 1) number of shares
to be compensated = [accumulated realized development profits from the base date of
appraisal to the expiry date of the performance guarantee period - unrealized development
profits of the projects (if any)]/guaranteed development profits x total subscribed shares.
Remarks: In the foregoing formula, the \"total subscribed shares\" refer to the total number
of shares obtained by SEG Group by using the real estate projects held indirectly that are
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
appraised by hypothetical development method to subscribe the total shares issued by
Shenzhen SEG. When the number of shares subscribed of Shenzhen SEG is calculated,
the impact of the percentage of equity of SEG Real Estate held by SEG Group and that of
the foregoing real estate projects held by SEG Real Estate shall be taken into
consideration. The realized development profits in the foregoing formula refer to the net
profits of the projects after deducting corresponding inventory development cost already
carried forward, expenses and taxes from the realized sales income of real estate projects
as of the expiry date of the restructuring compensation period. The unrealized
development profits refer to that if there are development products not sold yet in
corresponding real estate projects when the restructuring compensation period expires, the
unrealized development profits corresponding to the remaining development products
shall be determined according to the following methods: unrealized development profits =
estimated unit sales price of the remaining development products x area - book cost
corresponding to development products - estimated sales cost - estimated sales cost -
measured land VAT - measured income tax. Remarks: In the estimated unit sales price of
the remaining development products, if a sales contract has been signed, the unit price set
out in the contract shall prevail, and if no sales contract has been signed, the unit sales
price shall be determined by the unit sales price of the same type of products sold earlier;
the area shall be determined by the actually sold sales area corresponding to the
development product; estimated sales cost shall be determined according to the
percentage of the sales cost corresponding to the sales product in the sales income;
estimated sales taxes shall be determined according to the fee standard of the real estate
industry; and measured land VAT and income tax shall be calculated according to relevant
standards of the tax laws.
2) The part not covered by shares will be compensated by SEG Group in cash. Amount
of extra cash to be compensated = number of shares not covered x offering price of the
shares issued this time to purchase assets.
(3) When the performance guaranteed period expires, Shenzhen SEG shall hire the
Certified Public Accountant with securities practice qualification recognized by both
parties to carry out impairment test on the foregoing assets appraised by hypothetical
development method and issue the impairment test report. If the impairment amount at the
end of period of the real estate projects appraised by hypothetical development method is
greater than the total number of shares compensated during the performance guaranteed
period x offering price of the shares issued this time to purchase assets + total amount of
cash compensated, SEG Group shall make compensation for the impaired part of such
assets of Shenzhen SEG: 1) Number of shares compensated for the impaired part of the
real estate projects appraised by hypothetical development method = impairment amount
at the end of period of the real estate projects appraised by hypothetical development
method/offering price of the shares issued this time - total shares already compensated
during the performance guaranteed period. 2) The part not covered by shares will be
compensated by SEG Group in cash. Amount of extra cash to be compensated = number
of shares not covered x offering price of the shares issued this time to purchase assets.
(4) Under any circumstances, the total of the total amount of actually realized
development profits and unrealized development profits (if any) and the total number of
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
compensated shares occurred due to impairment test shall not exceed the total number of
shares of Shenzhen SEG (including the shares increased by transferring and stock
dividends) obtained by SEG Group subscribing the shares issued by Shenzhen SEG with
the real estate projects appraised by hypothetical development method. The insufficient
part will be compensated in cash by SEG Group with the limit as the cash consideration
paid for Shen SEG shares with such projects.
3. Performance compensation of assets appraised by market approach
(1) For the property assets appraised by market approach, Shenzhen SEG shall engage
certified public accountants that possess the qualification in practicing the securities
business in the end of every year during the performance guaranteed period to carry out
impairment test, and issue impairment test report. SEG Group shall compensate Shenzhen
SEG with the shares used by Shenzhen SEG as payment consideration acquired from
relevant assets subscription according to the following calculation method, and SEG
Group shall compensate in cash the part not covered by shares: 1) Total number of shares
to be compensated = impairment amount at the end of the current period/offering price of
the shares issued this time to purchase assets -number of shares already compensated. 2)
The part not covered by shares will be compensated by SEG Group in cash. Amount of
extra cash to be compensated = number of shares not covered x offering price of the
shares issued this time to purchase assets.
(2) Under any circumstances, the total number of shares compensated arising from the
impairment test shall not exceed the total amount of Shenzhen SEG shares acquired by
SEG Group with the property assets appraised by market approach previously (including
share increase by transfer and stock dividends). The part not covered by shares and the
amount compensated in cash in total shall not exceed the cash consideration paid for
Shenzhen SEG shares acquired by SEG Group with such property assets. Relevant
compensation methods for the foregoing 100% of the equity of SEG Property
Development, 100% of the equity of SEG Property management and the property assets
held by the target companies appraised by income approach and the real estate projects
appraised by hypothetical development method as well as other property assets appraised
by market approach are independent. The number of shares compensated by assets
appraised by other methods is not considered when the number of shares compensated is
calculated. When the number of shares to be compensated and/or amount of cash
calculation of each year is calculated according to relevant stipulations mentioned above,
if the number of compensated shares calculated is smaller than 0, take 0, i.e. the shares
compensated will not be refunded; if the cash compensation amount calculated is smaller
than 0, take 0, and the cash compensated will not be refunded. When the impairment
amount is calculated, the impact of capital increase, decrease, acceptance of the gift and
profit distribution of the shareholders of underlying assets during the performance
guaranteed period on the amount of impairment shall be eliminated.
(IV) Triggering condition for performance compensation
After the completion of the transaction, if assets within the transaction compensation
scope as specified in the special audit report are impaired or fail to achieve the promised
performance, SEG Group shall make compensation to Shenzhen SEG as agreed in the
agreement.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
(V) Performance compensation method
After the completion of the transaction, if assets within the transaction compensation
scope are impaired or fail to achieve the promised performance, SEG Group shall
compensate Shenzhen SEG in cash or shares.
(VI) Effectiveness and termination of the agreement
The agreement is made upon signature and seal by the legal representative or authorized
agent of each party. As an integral part of the Asset Purchase Facility, the agreement shall
come into effect from the date of effectiveness of the Asset Purchase Facility.
When the Asset Purchase Facility is rescinded, terminated, or deemed as invalid, the
agreement is also rescinded, terminated, or invalid.
(VII) Liability for breach of the agreement
Except for in case of force majeure, violation of any terms of the agreement by either
party constitutes breach of the agreement. The default party shall compensate for all
losses arising from breach of the agreement to the non-breaching party.
\"1. In the restructuring, relevant assets, such as some commercial electronics markets of
SEG Group that constitute horizontal competition, have not been injected into the listed
company. SEG Group will trust such assets to Shenzhen SEG or its subsidiaries after the
major asset restructuring. Within 5 years after the major asset restructuring, SEG Group
will take all necessary measures to solve flaws of such assets, and incorporate the
preceding specialized electronics markets that constitute horizontal competition into
Shenzhen SEG or transfer them to the third party in a feasible way such as sales based on
operating needs of Shenzhen SEG and the completeness of the ownership of such assets.
If SEG Group fails to complete the foregoing matters as scheduled, before injecting
relevant assets to Shenzhen SEG, SEG Group shall lease them to Shenzhen SEG for direct
operation and enjoy the income from such property. The annual rent of Shenzhen SEG is
the depreciated value of such property. Profit and loss incurred by leasing of such
Commitment on property assets shall be shared by Shenzhen SEG. The parties shall separately enter into a
horizontal leasing agreement.
Shenzhen SEG competition, 2. Except assets owned and business operated before the validity date of commitment, August 3, In normal
Long-term
Group Co., Ltd. related when acting as a controlling shareholder or actual controller of Shenzhen SEG, in order to 2016 progress
transaction, and guarantee sustainable development of Shenzhen SEG, the Company will exercise
capital occupation supervision and restriction on operating activities of its own and affiliated enterprises
under its control, will not establish new or acquire any assets or business same as or
similar to its main business within the operation area of Shenzhen SEG, and will not be
engaged in any activities that may damage the interests of Shenzhen SEG and other
companies and enterprises controlled by Shenzhen SEG, or other economic organizations.
If in the future there is any business opportunity same as or similar to other main business
within Shenzhen SEG operation area, such opportunity will preferentially be
recommended to Shenzhen SEG and other companies and enterprises controlled by
Shenzhen SEG, or other economic organizations. However, any of the following cases is
an exception: (1) Due to national laws, regulations and policies and other reasons, any
commercial properties and real estate development projects appropriated or allocated
through oriented protocols by the government to SEG Group and any enterprises invested
by it; or (2) when the general conditions of tender, transfer or assignment of specific
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
commercial properties and real estate development projects have specific requirements on
the bidder or assignee, Shenzhen SEG is not qualified y but SEG Group is qualified.
Commercial property and real estate development projects that are same as the main
business of Shenzhen SEG or result in horizontal competition subject to the above
exclusions may be invested and built by SEG Group at first. If Shenzhen SEG thinks that
such assets are eligible to be injected into Shenzhen SEG, upon receipt of the written
acquisition notice from Shenzhen SEG, SEG Group will negotiate on acquisition and
transfer such projects to Shenzhen SEG. In case of breach of the foregoing commitments,
the Company will bear all losses thus incurred to Shenzhen SEG, the subject company,
other companies, enterprises, or other economic organizations controlled by the
Company.\"
\"1. When the Company acts as the controlling shareholder of Shenzhen SEG, the
Company, other companies, enterprises, or other economic organizations controlled by the
Company, will minimize and regulate associated transactions with Shenzhen SEG or the
subject company, other companies, enterprises, or other economic organizations
controlled by the Company.
2. When the restructuring is completed, the Company, other companies, enterprises, or
other economic organizations controlled by the Company will handle associated
transactions with Shenzhen SEG or the subject company that are unavoidable or incurred
Commitment on for reasonable cause at fair and reasonable market price, perform the decision-making
horizontal procedure for associated transactions according to relevant laws, regulations, and
Shenzhen SEG competition, normative documents, fulfill the obligation of information disclosure and handle the August 3, In normal
Long-term
Group Co., Ltd. related approval procedures according to the law, do not use the dominant position of the 2016 progress
transaction, and controlling shareholder to damage the legal rights and interests of Shenzhen SEG and
capital occupation other shareholders.
3. The Company, other companies, enterprises, or other economic organizations
controlled by the Company will not use the rights of shareholders of the listed company
or the actual control ability to manipulate or instruct the listed company or its directors,
supervisors and senior executives to have the listed company unfairly provide or accept
funds, goods, services or other assets, or engage in any acts detrimental to the interests of
listed companies. In case of breach of the foregoing commitments, the Company will bear
all losses thus incurred to Shenzhen SEG, the subject company, other companies,
enterprises, or other economic organizations controlled by the Company.\"
1. The subject company is a limited liability company or stock-limited company
established and validly existing according to law with legitimate business qualification;
the subject company has obtained all approvals, permission, authorization and permits
required for its setting up and operation of business, all such approvals, permission,
Before
authorization and permits are valid and there exists no reasons or situations which may
Shenzhen SEG August 3, completion In normal
Other commitment cause the above approvals, permission, authorization and permits invalid.
Group Co., Ltd. 2016 of progress
2. The subject company has not been involved in any severe violation of laws or restructuring
regulations during production operation nor any situations where termination is required
according to the requirements of relevant laws, regulations, normative documents and
articles of association. As of the date of issuance of this commitment letter, the subject
company has no pending or predictable significant lawsuit, arbitration or administrative
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
penalty with amount of subject of more than one million or which will generate adverse
impact on its operation.
3. The subject company will independently and fully fulfill the labor contracts it signed
with employees.
4. If the subject company is subject to any recovery of fees or penalty from the relevant
competent organization in industrial and commerce, tax, employee salaries, social
insurance, housing fund, business qualification or competent authorities due to any facts
existing before this restructuring, the Company will fully indemnify the subject company
for all fees owned by subject company and assume all losses occurred by subject
company and Shenzhen SEG as a result of this.
5. The subject company legally possesses the ownership and/or right of usage of office
space, office equipment, trademark and other assets as necessary to guarantee normal
production operation, has independent and complete assets and business structure, has
legal ownership to its main assets with independent, complete and clear indication of
ownership.
6. The subject company has not been involved in any lawsuit, arbitration, judicial
mandatory enforcement and other situations which interferes with the transfer of company
ownership, and has not incurred any external guarantee that is against laws and articles of
association of the Company. After completion of this restructuring, if any loss is caused to
Shenzhen SEG and the subject company due to the Company's breach of the above
commitment, the Company agrees to assume the above mentioned liability of
indemnity/compensation to Shenzhen SEG/subject company.
\"1. 100% shares of SEG Property have been entrusted to a share entrusting agency as
required. Its equity form is authentic and valid, and the equity structure and ownership are
clear. The Company has no objection to the share ownership, share quantity, and share
holding percentage of SEG Property. The Company has no disputes over share ownership Before
Shenzhen SEG with SEG Property and other shareholders. August 3, completion
Other commitment In progress
Group Co., Ltd. 2. In case any dispute over ownership of the 3.85% shares of SEG Property of which 2016 of
ownership has not been determine as of July 26, 2016 occurs in the future, the Company restructuring
commits to SEG Property that the Company will provide any necessary assistant to SEG
Property to solve the dispute, protect SEG Property from any loss caused thereby, and
undertake corresponding responsibilities.\"
\"1. The Company will guarantee the independence of personnel of Shenzhen SEG and
subject company: (1) after completion of the restructuring, the labor, personnel and
compensation management of Shenzhen SEG are independent from the Company and
related parties, such as other companies, enterprises, or other economic organizations
Shenzhen SEG controlled by the Company. (2) Guarantee that after completion of this restructuring the August 3, In normal
Other commitment senior executives of Shenzhen SEG and the subject company hold full-time position at Long-term
Group Co., Ltd. 2016 progress
Shenzhen SEG and the subject company and receive compensation, and will not assume
any duties other than director and supervisor in the Company and other companies,
enterprises or other economic organizations and other connected parties under control of
the Company. (3) Guarantee not to, after completion of this restructuring, interfere with
the shareholders' meeting and board of directors meeting's exercise of power in
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
appointment/dismissal of personnel.
2. Guarantee the independence of institutions of Shenzhen SEG and subject company (1)
guarantee that after completion of this restructuring Shenzhen SEG and subject company
will have sound corporate governance structure and independent, complete organization.
(2) Guarantee that after completion of this restructuring the shareholders' meeting, board
of directors meeting and board of supervisors meeting of Shenzhen SEG and subject
company will exercise duties and powers according to laws, regulations and articles of
association of Shenzhen SEG and subject company.
3. The Company will guarantee the independence and completeness of Shenzhen SEG
and the subject company: (1) After completion of the restructuring, Shenzhen SEG and
the subject company will have independent and complete assets related to production and
management. (2) Guarantee that after completion of this restructuring the site for business
operation of Shenzhen SEG and subject company are independent of the Company and
other companies, enterprises or other economic organizations and other connected parties
under control of the Company. (3) Except normal operational intercourse, guarantee that
after completion of this restructuring Shenzhen SEG and subject company do not exist
any situation that funds or assets are possessed by the Company and other companies,
enterprises or other economic organizations and other connected parties under control of
the Company.
4. Guarantee the businesses of Shenzhen SEG and subject company are independent (1)
guarantee that after completion of this restructuring Shenzhen SEG and subject company
have relevant qualification for independently carrying out operational activities, and
possess independent, sustainable market-oriented operational capability. (2) Except the
assets owned and business operated before validity date of commitment, during the period
as controlling shareholder of Shenzhen SEG, in order to guarantee sustainable
development of Shenzhen SEG, the Company will exercise supervisory and restriction on
operating activities of its own and the affiliated enterprises under its control, and will not
establish new or acquire any assets or businesses same or similar with its main businesses
within the operation area of Shenzhen SEG, and will also not be engaged in any activities
which may damage the interests of Shenzhen SEG and other companies, enterprises or
other economic organizations under control of Shenzhen SEG; if in future there exists any
business opportunity same or similar with other main businesses within Shenzhen SEG
operation area, such opportunity will preferentially recommended to Shenzhen SEG and
other companies, enterprises or other economic organizations under control of Shenzhen
SEG. (1) Due to national laws, regulations and policies and other reasons, any commercial
properties and real estate development projects appropriated or allocated through oriented
protocols by the government to SEG Group and any enterprises invested by it; or (2)
When the general conditions of tender, transfer or assignment of specific commercial
properties and real estate development projects have specific requirements on the bidder
or assignee, Shenzhen SEG is not qualified but SEG Group is qualified. Commercial
property and real estate development projects that are same as the main business of
Shenzhen SEG or result in horizontal competition subject to the above exclusions may be
invested and built by SEG Group at first. If Shenzhen SEG thinks that such assets are
eligible to be injected into Shenzhen SEG, upon receipt of the written acquisition notice
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
from Shenzhen SEG, SEG Group will negotiate on acquisition and transfer such projects
to Shenzhen SEG. (3) Guarantee that after completion of this restructuring, the Company
and other companies, enterprises, other economic organizations or other connected parties
under control of the Company will reduce connected transactions with Shenzhen SEG and
subject company and other companies, enterprises, other economic organizations or other
connected parties under their control; for any connected transactions which are indeed
necessary and unavoidable, guarantee to carry out fair operation following market
principle at fair price and fulfill relevant approval procedure and information disclosure
obligations according to the provisions of relevant laws, regulations and normative
documents.
5. The Company will guarantee the financial independence of Shenzhen SEG and the
subject company: (1) After completion of the restructuring, Shenzhen SEG and the
subject company will establish an independent financial department, independent
financial accounting system, and standard and independent financial accounting rules. (2)
After completion of the restructuring, Shenzhen SEG and the subject company will
separately open an account in banks, and do not share accounts with the Company and
related parties, such as other companies, enterprises, or other economic organizations
controlled by the Company. (3) After completion of the restructuring, financial personnel
of Shenzhen SEG and the subject company will not hold a part-time job in the Company
or related parties, such as other companies, enterprises, or other economic organizations
controlled by the Company. (4) After completion of the restructuring, Shenzhen SEG and
the subject company will independently make financial decisions, and the Company will
not interfere with fund usage of Shenzhen SEG and the subject company. (5) After
completion of the restructuring, Shenzhen SEG and the subject company will pay taxes
independently according to laws. In case of breach of the foregoing commitments, the
Company will bear all losses thus incurred to Shenzhen SEG, and the subject company.\"
1. The Company does not exist any of the following situations as specified in Clause 6,
Administrative Measures On Acquisition Of Listed Companies: (1) Damage legitimate
rights and interests of the company acquired and its shareholders utilizing acquisition of
listed company; (2) With large amount of outstanding debts and this in-debt status has
lasted for a certain period of time; (3) Has actual or alleged serious illegal activities in
recent three years; (4) Has serious behaviors of breaching promises in securities market in Before
Shenzhen SEG August 3, completion
Other commitment recent three years; (5) Other situations in which no acquisition of listed companies are In progress
Group Co., Ltd. allowed according to laws and administrative regulations and in the opinions of CSRC. 2016 of
restructuring
2. The Company and its main managers have not suffered from any administrative
punishment (administrative punishment obviously unrelated to security market excluded),
criminal punishment, major civil lawsuit or arbitration related to economic disputes
within the last five years. In case of breach of the foregoing commitments, the Company
will bear all losses thus incurred to Shenzhen SEG, and the subject company.\"
\"1. The Company is an enterprise incorporated in China that owns the full capacity for
Before
civil conduct and has the legal body qualification for participating in the restructuring,
Shenzhen SEG August 3, completion In normal
Other commitment signing agreements with Shenzhen SEG, and performing rights and obligations under the
Group Co., Ltd. 2016 of progress
agreement.
restructuring
2. Except that the property located at 4F, Block 2, SEG Industry Building of SEG
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Property Investment funded by the Company is to handle the transfer formality (with no
legal impediment), the Company has fulfilled the obligation of contributing capital to the
subject company, and has no acts against its obligations and responsibilities as a
shareholder, such as false contribution, deferred investment, or withdrawal of capital.
There are no circumstances that may affect the legal existence of the subject company.
3. There is no dispute or potential dispute over ownership of equities of the subject
company. There are no circumstances that may affect the legal existence of the subject
company.
4. The equities held by the Company in the subject company are actually legally owned.
There is no dispute or potential dispute over ownership of equities, no trust, shareholding
under entrustment or similar arrangement, no commitment or arrangement of forbidden
transfer or limited transfer, no pledge, freezing, seals up, property preservation or other
limitation of rights, and no lawsuit, arbitration or other forms of dispute which would
affect the restructuring. Meanwhile, the Company guarantees that the equities it held in
the subject company will maintain the status until the equities are registered under
Shenzhen SEG after change of registration.
5. The equities held by the Company in the subject company are assets with clear
ownership. The Company undertakes that there are no legal obstacles to stock transfer
after the restructuring of Shenzhen SEG is approved by CSRC, and no credit and debt
disputes. The Company promises to complete formalities for ownership transfer of these
equities within the agreed period.
6. Before the equities are registered under Shenzhen SEG after change of registration, the
Company undertakes that the subject company will maintain normal, orderly, and
legitimate operation, and will not take actions irrelevant to normal production and
management, such as disposal of assets, external guarantee, or additional major debts, or
illegally transfer or conceal assets and business. If the foregoing actions are indeed
necessary, provided that national laws, regulations, and normative documents are not
violated, these actions can be taken only after written approval of Shenzhen SEG.
7. The Company undertakes that there are not any ongoing or potential litigation,
arbitration, or dispute that may affect the Company's equity transfer, and all agreements or
contracts do not contain restrictive clauses that may affect the Company's equity transfer.
The articles of association, internal management system documents, and contracts or
agreements do not contain restrictive clauses that may affect the Company's equity
transfer. In case of breach of the foregoing commitments, the Company will bear all
losses thus incurred to Shenzhen SEG.\"
\"The Company has not disclosed any insider information about the restructuring or
Shenzhen SEG August 3, In normal
Other commitment utilized such insider information for insider trading. In case of breach of the foregoing Long-term
Group Co., Ltd. 2016 progress
commitments, the Company will bear all losses thus incurred to Shenzhen SEG.\"
\"1. Shares of Shenzhen SEG subscribed by the Company in the restructuring will be
Shenzhen SEG locked up for 36 months from the date of listing. Shares of Shenzhen SEG acquired in the August 3, In normal
Other commitment restructuring shall not be traded or transferred or managed by others under entrustment or Long-term
Group Co., Ltd. 2016 progress
repurchased by Shenzhen SEG within 36 months from the date of completion of the
offering. After the completion of this offering, additional shares held due to bonus shares
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
and converted equity capital shall be also subject to the foregoing agreement. When the
foregoing lockup period expires, share transfer and transaction will be subject to the valid
laws, regulations, and provisions, rules, and requirements of China Securities Regulatory
Commission and Shenzhen Stock Exchange.
2. If the closing price of Shenzhen SEG stocks is lower than the initial offer price for
consecutively 20 trading days within 6 months after the completion of the restructuring or
the closing price of Shenzhen SEG stocks is lower than the initial offer price at the end of
6 months after the completion of the restructuring, the lockup period of Shenzhen SEG
stocks will be automatically extended for 6 months.
3. If the information provided or disclosed in the restructuring is suspected of false
representations, misleading statements, or material omissions and the judicial authority or
China Securities Regulatory Commission investigates and places the case on file, shares
of Shenzhen SEG held by the Company will not be transferred.
4. Before the restructuring, all stocks of Shenzhen SEG held by the Company shall not be
transferred within 12 months after the completion of the restructuring.
5. If relevant laws, regulations, and normative documents have special requirements on
the lockup period of shares, these laws, regulations, and normative documents shall
prevail.
6. If the foregoing lockup period is not consistent with the latest regulation requirement of
the security regulatory authority, the Company agrees to adjust it according to the latest
regulation opinion of the regulation suggestion of the security regulatory authority and
implement the relevant provision of China Securities Regulatory Commission and
Shenzhen Stock Exchange after the lockup period expires.
\"1. In the recent 5 years, the Company has not been subject to any administrative penalty
(except those not related to the securities market) or criminal penalty.
2. In the recent 5 years, except for those cases that have been concluded, such as the case
of Hainan SEG International Trust and Investment Company, Zhongshi case, GTJA case
and Dasheng case, the Company is not involved in other major civil proceedings or
arbitration (the subject in dispute of 10 million yuan) related to economic disputes. Before
Shenzhen SEG August 3, completion In normal
Other commitment 3. The Company has never been suspected of insider trading related to major asset
Group Co., Ltd. restructuring and placed on file for investigation or placed on file with the case not 2016 of progress
settled. In the recent 5 years, the Company has never failed to repay large debts or fulfill restructuring
commitments, or been subject to administrative supervision measures by the CSRC or
disciplinary action by the Stock Exchange due to insider trading related to major assets
restructuring, or been held criminally liable by the judicial authorities according to law. In
case of breach of the foregoing commitments, the Company will bear all losses thus
incurred to Shenzhen SEG.\"
Bo Hongxi, \"1. I have not been subject to any administrative penalty by the CSRC in recent 36
Cao Xiang, Fan months, or public censure by the Stock Exchange in the recent 12 months. Before
Zhiqing, Li August 3, completion In normal
Other commitment 2. I have not been investigated by judicial authorities due to alleged crimes or by CSRC 2016
Luoli, Liu of progress
due to alleged irregularities. restructuring
Fusong, Liu
Zhijun, Ru In case of breach of the following commitments, I will bear all losses thus incurred to
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Guiqin, Song Shenzhen SEG.\"
Pingping, Tang
Chongyin,
Wang Li, Xu
Ning, Yu Qian,
Zhang
Guangliu,
Zhang Haifan,
Zheng Dan,
Zhu Longqing
\"1. In the recent 5 years, the Company has not been subject to any administrative penalty
or criminal penalty or involved in other major civil proceedings or arbitration related to
economic disputes.
Directors,
supervisors, and 2. The Company has never been suspected of insider trading related to major asset Before
senior restructuring and placed on file for investigation or placed on file with the case not August 3, completion In normal
Other commitment settled. In the recent 5 years, the Company has never failed to repay large debts or fulfill
executives of 2016 of progress
Shenzhen SEG commitments, or been subject to administrative supervision measures by the CSRC or restructuring
Group Co., Ltd. disciplinary action by the Stock Exchange due to insider trading related to major assets
restructuring, or been held criminally liable by the judicial authorities according to law. In
case of breach of the following commitments, I will bear all losses thus incurred to
Shenzhen SEG.\"
SegMaker, SEG
Kangle, SEG \"1. In the recent 3 years, the Company has not been subject to any major administrative
Property punishment or criminal punishment or involved in other major civil proceedings or
Development, arbitration related to economic disputes.
SEG Property 2. The Company has never been suspected of insider trading related to major asset Before
Investment, restructuring and placed on file for investigation or placed on file with the case not August 3, completion In normal
SEG New City Other commitment settled. In the recent 5 years, the Company has never failed to repay large debts or fulfill 2016 of progress
Construction, commitments, or been subject to administrative supervision measures by the CSRC or restructuring
SEG Property disciplinary action by the Stock Exchange due to insider trading related to major assets
Management, restructuring, or been held criminally liable by the judicial authorities according to law. In
Huizhou case of breach of the following commitments, I will bear all losses thus incurred to
Qunxing, Xi'an Shenzhen SEG.\"
SEG, Beijing
\"1. SEG Group has legal ownership of lands, properties, and equities transferred to
SegMaker without compensation before the restructuring, and there is no dispute over the
ownership of transferred assets. Except for some mortgaged properties that require the
Before
consent of the mortgagee, there is no legal obstacle to the registration of ownership
Shenzhen SEG August 3, completion In normal
Other commitment change.
Group Co., Ltd. 2016 of progress
2. The Company undertakes to complete the formalities of ownership registration change restructuring
of assets transferred to SegMaker before the Board of Directors reviews the restructuring
draft. The Company will compensate SegMaker in full if SegMaker is held responsible or
punished, or suffer any other loss due to the Company's violation of the foregoing
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
commitment or defects of the transferred assets.\"
\"As of the date of issuance of the commitment letter, SEG Kangle owns 9 properties with
the total construction area of 12,941.28 square meters. The actual proprietor of the
property located at 1F, Block 1, SEG Industry Building with an area of 902 square meters
is SEG Group. Due to the provision that industrial buildings in Shenzhen shall be
transferred as a whole, the transfer registration formality for the property has not been
handled. The actual proprietor of Room 508, Block 4, SEG Residential Quarter is SEG
Kangle, but the property is registered under SEG Group and the transfer formality for the
property has not been handled. The Company undertakes that all parties have no disputes
over the ownership of the foregoing property whose registered proprietor is SEG Kangle
but whose actual proprietor is SEG Group and the property whose registered proprietor is
SEG Group but whose actual proprietor is SEG Kangle. SEG Group will assist SEG
Kangle in completing the division and transfer registration formalities for the foregoing
properties. After the restructuring, if Shenzhen SEG suffers any losses due to ownership
of such properties, SEG Group will compensate Shenzhen SEG in full.
2. The construction in process-assembly workshop that SEG Group uses to contribute
capital to SEG Property Investment is 4F, Block 2, SEG Industry Building (real estate
proprietorship certificate No.: S. F. D. Zi. No. 3000759297) with the total area of 1,936.71
square meters. The property was delivered to SEG Property Investment upon capital
contribution, but the transfer formality could not be handled without the certificate on
capital contribution. Due to negligence of the handler, the property was registered under Before
Shenzhen SEG SEG Group together with other properties of SEG Industry Building belonging to SEG August 3, completion In normal
Other commitment Group. Due to the restriction of transfer of industrial buildings as a whole, the transfer
Group Co., Ltd. 2016 of progress
formality has not been handled.SEG Property Investment has been occupying, using, and restructuring
acquiring operating revenue from the property since capital contribution. The Company
will assist SEG Property Investment in completing the transfer registration formality of
the foregoing property. After the restructuring, if Shenzhen SEG suffers any losses due to
ownership of such properties, SEG Group will compensate Shenzhen SEG in full.
3. The Company will help and propel the subject company and its subsidiaries to
complete ownership registration of land and property assets and regulate the land purpose.
4. If due to land use rights and property assets existing before the completion of the
restructuring, the subject company and its subsidiaries (1) fail to timely handle the land
use rights and the proprietorship certificate (excluding results not caused by the subject
company and its subsidiaries, such as force majeure, laws, policies, government
management, and change in planned land purpose); or (2) cannot handle the relevant land
use rights and real estate proprietorship certificate (excluding results not caused by the
subject company and its subsidiaries, such as force majeure, laws, policies, government
management, and change in planned land purpose); or (3) are subject to other
circumstances of nonstandard land use rights and properties (excluding results not caused
by the subject company and its subsidiaries, such as force majeure, laws, policies,
government management, and change in planned land purpose), and suffer actual losses
including but not limited to compensation, fines, expenses, and interests damage, the
Company will compensate the subject company and its subsidiaries in full.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Before issuance date of the restructuring report of Shenzhen SEG, SEG Group will finish
formalities related to transfer of ownership of the property (4F, Block 2, SEG Industry
Building). If SEG Group fails to finish the formalities at expiration, SEG Group agrees to Before
Shenzhen SEG compensate SEG Property Investment RMB 1.5 million in currency, and allows SEG August 3, completion
Other commitment In progress
Group Co., Ltd. Property Investment to continue to use the property for free until SEG Group transfers the 2016 of
ownership of the property to SEG Property Investment. SEG Group agrees to compensate restructuring
SEG Property Investment for any operating loss or other economic loss of SEG Property
Investment caused by SEG Group's failure in transferring the ownership of the property.
\"After updating and restructuring of SEG Industry Building, SEG Economy Building, and
SEG Kangle Industry Building, the area of added part that belongs to SegMaker, SEG
Kangle and SEG Property is 2,855.20 square meters.SEG Group undertakes that the use
of the temporary buildings belonged to SegMaker, SEG Kangle and SEG Property will be
renewed after expiration of the two-year use duration. In case when, due to failure in
renewal of use of temporary buildings, the listed company has any loss or the income
during the period from expiration of the performance commitment period to expiration of
the evaluated income expected period is lower than the expected compensation, or the
listed company has any loss because the temporary buildings are required to be
dismantled by governmental organs during the period from expiration of the performance
commitment period to expiration of the evaluated income expected period, SEG Group
will compensate the listed company timely and in full amount according to the following
compensation methods:
1. SEG Group has made commitments for the performance of the subject company within
three years after completion of major asset restructuring. Influence of the updating and
restructuring project has been taken into account in the commitments.
2. The amount of compensation for the income that is lower than the expected income
Shenzhen SEG August 3,
Other commitment during the period from expiration of the performance commitment period to expiration of Long-term In progress
Group Co., Ltd. the evaluated income expected period = (the predicted accumulated income to the end of 2016
the report period - actual accumulated income to the end of the report period) - the
compensated amount.
3. The loss caused when the temporary buildings are required to be dismantled by
governmental organs during the period from expiration of the performance commitment
period to expiration of the evaluated income expected period = the dismantling cost and
compensation amount related - (the accumulated total income to the time the buildings are
dismantled- predicted accumulated income during the predication period). Note: the
predicted income refers to the net value remained after the predicted total income from
the newly added temporary buildings in the evaluation reports of the subject companies
minuses the allocated investment cost during the operating period and the amount
influenced by permanent rent termination predicted in the evaluation report. Shenzhen
SEG should employ an auditing agency with security practice qualification recognized by
SEG Group to provide a formal auditing report on the compensation methods for the
property investment within the compensation scope of the report period within four
months at the end of each accounting year during the compensation period.SEG Group
should compensate in cash any property investment and compensation items within the
compensation scope of the report period. Shenzhen SEG should calculate the payable
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
compensation amount within 15 working days upon final specific review opinions
provided by the auditing agency, and send a written notice to SEG Group. Within 30
working days upon receipt of the written notice from Shenzhen SEG, SEG Group should
pay the compensation in cash in full amount.\"
\"1. In case when, after the restructuring, the land/property use should be changed based
on the actual operating demands of the subject company or because the subject company
is required by the relevant house property management organ or the land regulatory
department to change the land/property use, SEG Group will assist the subject company
Shenzhen SEG August 3,
Other commitment in finishing the relevant formalities. Long-term In progress
Group Co., Ltd.
2. In case when the subject company suffers from administrative penalty by relevant land
and/or house property management department because the actual use of the
land/property is different from those recorded in the certificate, SEG Group will
compensate the subject company for any expenditures and economic loss caused thereby.\"
\"1. Since the issuance date of this commitment letter, SEG Group will assist SegMaker in
restoring for business purpose the part currently functioning as a parking garage on the
first floor of the podium of SEG Jingyuan Building within five years. Within five
years from
Shenzhen SEG 2. If the restoration work cannot be finished within the above mentioned period of time, August 3, the date of In normal
Other commitment SEG Group agrees to process the subject assets as follows: (1) paying in cash the
Group Co., Ltd. 2016 issue of the progress
evaluated value of the parking garage and the bank interest of the evaluated value in the commitment
same period from the restructuring closing date to the expiration of this commitment time; letter
or (2) purchasing in cash the first floor of the podium of SEG Jingyuan Building at a price
no less than the evaluated value of the building during this restructuring.\"
\"1. If after the restructuring, Shen SEG is requested to make a supplementary payment for
land transfer and pay the overdue fine due to inconsistency between the actual use and the
Shenzhen SEG registered use of the above property, the Company undertakes to bear such expenses in August 3, In normal
Other commitment full. Long-term
Group Co., Ltd. 2016 progress
2. In case of breach of the foregoing commitments, the Company will bear all losses thus
incurred to Shen SEG.\"
According to the Article Five of the Equity Transfer Agreement signed by the Company
Commitment on
with SEG Group when the Company was listed, SEG Group agreed that the Company and
horizontal
its subsidiaries and associated companies to use the eight trademarks registered by SEG
Shenzhen SEG competition, In normal
Group at the National Trademark Bureau; SEG Group agreed that the Company used the July 1, 1996 Long-term
Group Co., Ltd. related progress
aforesaid trademarks or similar signs as the Company's logo and used the trademarks and
transaction, and
Commitment made at signs during its operation; the Company need not pay any fee to SEG Group for using the
capital occupation
the time of initial aforesaid trademarks or signs.
public offerings or As for the problem pointed out by Shenzhen Office of China Securities Regulatory
refinancing Commitment on
horizontal Commission during on-site inspection in 2007 in the Company that the Company and
Shenzhen SEG competition, SEG Group are competitive in the electronic business, the Company has received a September In normal
written Commitment Letter from SEG Group on September 14, 2007. The content of the 14, 2007 Long-term
Group Co., Ltd. related progress
transaction, and Commitment Letter is as follows: \"The competition in electronic business between SEG
capital occupation Group and Shenzhen SEG Co., Ltd. occurs due to historical reasons and objective market
development background.SEG Group hereby commits that, we will not separately operate
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
businesses similar to those of Shenzhen SEG in the same city.\"
The term of
validity is
from
February 1,
2011 to
January 31,
2016, five
years in
total. And
the entrusted
operating
management
The 6th interim meeting of the 5th Board of Directors held on January 26, 2011 reviewed
Commitment on contract
and approved the Proposal of Solving the Horizontal Competition between the Company
horizontal expires
and Its Controlling Shareholder. After friendly consultation, SEG Group agreed to entrust
Shenzhen SEG competition, January 26, within the In normal
the Company to operate and manage with full authority SEG Communications Market
Group Co., Ltd. related 2011 report progress
under direct management of SEG Group. Therefore, the two parties have signed the
transaction, and period. As of
entrustment operation and management contract, and SEG Group will pay the Company
capital occupation the end of
RMB 200,000 Yuan as entrust management expenses.
the report
period, the
Contract has
been
renewed,
and the term
of validity is
from
February 1,
2016 to
January 31,
2017.
Commitment on equity
Not applicable
incentives
Based on our confidence in economic prospect of China and future development of the
Other commitments Company, in order to jointly maintain a stable capital market and promote a sustainable,
made to the medium Shenzhen SEG stable and healthy development of the Company, Shenzhen SEG Group Co., Ltd., the
Other commitment July 9, 2015 12 months Fulfilled
and small shareholders Group Co., Ltd. holding shareholder of the Company, hereby commits that, it will not reduce the amount
of the Company of shares of the Company it holds within the coming twelve months since the issuance
date of this Announcement, i.e., July 9.
Whether commitments
Yes
were fulfilled on time
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
2. The attainment of forecasts for the assets or projects of the Company which were profitable and the
description of the reasons with the report period remaining in the forecasting period
□ Applicable √ Not applicable
IV. Non-operating Capital Occupation on the Listed Company by the Controlling
Shareholders and Related Parties
□ Applicable √ Not applicable
No non-operating capital occupation on the listed company by the controlling shareholders and related parties is
involved in the report period.
V. Explanations of the Board of Directors, the Board of Supervisors and Independent
Directors (if any) to the \"Non-standard Audit Report\" made by the accounting firm in the
report period
□ Applicable √ Not applicable
VI. Information on changes in accounting policies, accounting estimates and accounting
methods compared with the financial reports of the last year
√ Applicable □ Not applicable
The Ministry of Finance issued the VAT Accounting Treatment Rules (C. K. [2016] No. 22) on December 3,
2016.
According to the VAT Accounting Treatment Rules, after the program of replacing business tax with value-added
tax is put into trial implementation, \"business tax and surtax\" is changed to \"tax and surtax\", relating to the
accounting of the consumption tax, urban maintenance and construction tax, resource tax, educational surtax,
property tax, land use tax, travel tax, and stamp duty incurred by business operation; the \"business tax and
surtax\" in the profit statement is changed to \"tax and surtax\".
As specified in the VAT Accounting Treatment Rules, the closing debit balance of \"VAT payable\", \"unpaid VAT\",
\"input tax to be deducted, \"input tax to be certified\", and \"excess VAT paid\" under the \"tax payable\" item shall be
presented in \"other current assets\" or \"other non-current assets\" of the balance sheet statement as the case may be;
the closing debit balance of \"tax payable-output tax to be transferred\" shall be presented in \"other current
liabilities\" or \"other non-current liabilities\" of the balance sheet statement as the case may be.
In accordance with the VAT Accounting Treatment Rules, the Company has adjusted the amount of affected items
in the financial statements, such as assets, liabilities, profit and loss arising from transactions from May 1, 2016
to the implementation of the Rules. The property tax, land use tax, travel tax, and stamp duty incurred after May
1, 2016 are adjusted from \"management fee\" to \"tax and surtax\" RMB 4,775,904.89; \"tax payable-deductible
input VAT\" are classified in \"other current liabilities\" with the amount of RMB 350,217.26; the amount of
transactions occurring from January 1 to April 30, 2016 is not subject to retroactive adjustment; financial
statements (2016) in the comparable period are not subject to retroactive adjustment.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
VII. Information on retroactive restatements in corrections of major accounting errors in the report
period
□ Applicable √ Not applicable
There is no retrospective restatement due to corrections on significant accounting errors in the report period.
VIII. Information on changes in the scope of consolidation compared with the financial
report of the last year
√ Applicable □ Not applicable
Twenty-three entities are included in the current consolidated financial statements, namely:
Type of Proportion of Proportion of voting
Company name Level
subsidiary shareholding (%) right (%)
Shenzhen SEG Baohua Enterprise Development Holding
I 66.58 66.58
Co., Ltd. subsidiary
Holding
Shenzhen Mellow Orange Business Hotel
grandson II 66.58 66.58
Management Co., Ltd
company
Wholly-owned
Shenzhen SEG Industrial Investment Co., Ltd. I 100.00 100.00
subsidiary
Holding
Changsha SEG Development Co., Ltd. I 46.00 51.00
subsidiary
Shenzhen SEG Electronics Market Management Share-controlled
I 70.00 70.00
Co., Ltd. subsidiary
Suzhou SEG Electronics Market Managementy Co., Holding
I 45.00 45.00
Ltd. subsidiary
Holding
Xi'an SEG Electronics Market Co., Ltd. I 65.00 65.00
subsidiary
Holding
Shenzhen SEG Credit Co., Ltd. I 54.00 54.00
subsidiary
Shenzhen SEG Electronics Market Management Wholly-owned
I 100.00 100.00
Co., Ltd. subsidiary
Holding
Xi'an Hairong SEG Electronics Market Co., Ltd. I 51.00 51.00
subsidiary
Wujiang SEG Electronics Market Management Co., Holding
I 51.00 51.00
Ltd. subsidiary
Holding
Wuxi SEG Electronics Market Co., Ltd I 51.00 51.00
subsidiary
Shunde SEG Electronics Market Management Co., Wholly-owned
I 100.00 100.00
Ltd. subsidiary
Nanning SEG Electronics Market Management Co., Wholly-owned
I 100.00 100.00
Ltd. subsidiary
Wholly-owned
Nantong SEG Times Plaza Development Co., Ltd. I 100.00 100.00
subsidiary
Yantai SEG Times Plaza Development Co., Ltd. Holding I 90.00 90.00
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Type of Proportion of Proportion of voting
Company name Level
subsidiary shareholding (%) right (%)
subsidiary
Nantong SEG Commercial Operation Management Wholly-owned
I 100.00 100.00
Co., Ltd. subsidiary
Wholly-owned
Suzhou SEG Digital Plaza Management Co., Ltd. I 100.00 100.00
subsidiary
Xi'an Fengdong New Town SEG Times Plaza Wholly-owned
I 100.00 100.00
Properties Co., Ltd. subsidiary
Suzhou SEG Intelligent Technology Co., Ltd. Wholly-owned
I 100.00 100.00
subsidiary
Shenzhen SEG Longyan New Energy Application Holding
and Development Co., Ltd. I 50.00 50.00
subsidiary
Shenzhen SEG Investment Management Co., Ltd. Wholly-owned
I 100.00 100.00
subsidiary
Shenzhen SEG Longyan Energy Technology Co., Holding
Ltd. I 50.00 50.00
subsidiary
For the cause of difference between the proportion of shareholding and the proportion of voting rights and the
basis for control of the invested entity even with half of voting rights or less, see \"Attachment 9: Equities in
other entities - (1) Equities in subsidiaries\".
Compared with the previous period, three more entities are included in and one entity is excluded from the
consolidated financial statements in the current period, including:
1. Subsidiaries, special purpose entities, and business entities that gain control by way of commissioning
management or renting included in the consolidation scope in the current period
Name Reason for change
Suzhou SEG Intelligent Technology Co., Ltd. Newly established
Shenzhen SEG Longyan New Energy Application
Newly established
and Development Co., Ltd.
Shenzhen SEG Longyan Energy Technology Co.,
Newly established
Ltd.
2. Subsidiaries, special purpose entities, and business entities that lose control by way of commissioning
management or leasing excluded from the consolidation scope in the current period
Name Reason for change
Shenzhen SEG E-Commerce Co., Ltd. Transfer-out of all equities
For details of entity change in the consolidation scope, see \"Note VIII. Change in consolidation scope\".
IX. Engagement and dismissal of the accounting firm
Engaged accounting firm
Name of accounting firm engaged from China Da Hua Certified Public Accountants (Special General Partnership)
Remuneration for the accounting firm engaged from
China (RMB 10,000)
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Consecutive years of service offered by accounting
firm engaged from China
Name of certified public accounts from the
Zhang Xing and Zhang Zhaocheng
accounting firm engaged from China
Name of accounting firm engaged from outside of
None
China (if any)
Consecutive years of service offered by overseas
None
accounting firm (if any)
Is another accounting firm engaged in current period?
□ Yes √ No
Engagement of internal control audit accounting firm, financial adviser or sponsor
□ Applicable √ Not applicable
X. Information on Listing Suspension or Abortion after Disclosure of Annual Report
□ Applicable √ Not applicable
XI. Bankruptcy and Reorganization
□ Applicable √ Not applicable
No bankruptcy and reorganization matter is involved in the report period.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
XII. Major lawsuits and arbitrations
√ Applicable □ Not applicable
Whether
Judgment
Amount estimated Judgment
Basic information about lawsuits and arbitrations Progress result and Disclosure date Disclosure index
(RMB: 10,000) liabilities execution
impact
occurred
Case number: 2016 G. 0102 M. C. No. 3653
Plaintiff: Nanning Haiqi Real Estate Development Co.,
Ltd.
Defendant 1: Nanning SEG Electronics Market Co., Ltd. http://www.cninfo.com.cn
(\"Nanning SEG\")
Announcement of
Defendant 2: Shenzhen SEG Co., Ltd. The case is heard and
A dispute over the lease contract arose among 1,026.3 Yes Inconclusive None September 29, 2016 Shenzhen SEG Co., Ltd.
pending. on Receipt of Court
Nanning Haiqi, Nanning SEG and the Company. Nanning Summons and the Civil
SEG did not pay the rent for the third year according to the Complaint
cooperation contract. The court found that Nanning SEG
locked and sealed the shop front on June 30, 2015, which
constituted a fundamental breach of contract. Nanning
SEG was sued for breach of contract.
Case number: 2016 G. 0102 M. C. No. 3654
Plaintiff: Nanning Yuanpeng Property Service Co., Ltd.
Defendant 1: Nanning SEG Electronics Market Co., Ltd.
Defendant 2: Shenzhen SEG Co., Ltd. http://www.cninfo.com.cn
A dispute over the property service contract arose Announcement of
among Nanning Yuanpeng Property Service Co., Ltd. The case is heard and
(hereinafter referred as \"Yuanpeng Property\"), Nanning 246.98 No Inconclusive None September 29, 2016 Shenzhen SEG Co., Ltd.
pending. on Receipt of Court
SEG and the Company. Nanning SEG did not pay the rent Summons and the Civil
for the third year according to the cooperation contract. Complaint
The court found that Nanning SEG locked and sealed the
shop front on June 30, 2015, which constituted a
fundamental breach of contract. Nanning SEG was sued by
Yuanpeng Property for breach of contract.
Case number: 2015 X. M. Y. C. Zi. No. 1590 Nanning SEG's http://www.cninfo.com.cn
Plaintiff: Nanning SEG Electronics Market Co., Ltd. The case has been claim was 2016 Semi-annual Report
999.7 Yes Executed August 24, 2016
Defendant: Nanning Haiqi Real Estate Development Co., settled. dismissed by of Shenzhen SEG Co.,
Ltd. (2015) X. M. Y. Ltd.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
A contract dispute arose between Nanning Haiqi and C. Zi. No. 1590
Nanning SEG. In March 2013, Nanning SEG rented Civil Judgment
houses located at 1F to 2F, Nanning Property Development of the People's
Plaza, 158 East Renmin Road, Xingning District, Nanning Court of
to set up the electronics market. The agreed lease term was Xingning
from March 18, 2013 to March 17, 2025. After District,
unsuccessful negotiation with Nanning Haiqi on large area Nanning.
of water seepage and water leakage of the leased houses
for several times, Nanning SEG filed a lawsuit to the
People's Court of Xingning District, Nanning.
Case number: 2015 X. M. Y. C. Zi. No. 1393
Plaintiff: Nanning Haiqi Real Estate Development Co.,
Ltd.
http://www.cninfo.com.cn
Defendant: Nanning SEG Electronics Market Co., Ltd. The case has been We lost the
1,280.99 Yes Executed August 24, 2016 2016 Semi-annual Report
A contract dispute arose between Nanning Haiqi and settled. lawsuit. of Shenzhen SEG Co.,
Nanning SEG. Due to Nanning SEG's failure to pay the Ltd.
rent and the breach of contract, Nanning Haiqi filed a
lawsuit against Nanning SEG to the court. The two cases
were consolidated for trial.
Case number: 2015 G. S. M. W. C. Zi. No. 00126
Plaintiff: Suzhou Rail Transit Co., Ltd.
Defendant: Shenzhen SEG Co., Ltd. http://www.cninfo.com.cn
A contract dispute arose between Resource The case has been We lost the 2016 Semi-annual Report
Development Subsidiary of Suzhou Rail Transit Co., Ltd. 284 Yes Executed August 24, 2016
settled. lawsuit. of Shenzhen SEG Co.,
(\"Suzhou Rail Transit \") and Suzhou SEG. On January 26, Ltd.
2015, Suzhou Rail Transit filed a lawsuit to the court and
petitioned the court to order Suzhou SEG to pay the
liquidated damages.
Case number: (2016) J. Z. A. Zi. No. 2294
Plaintiff: Shenzhen SEG Co., Ltd.
Defendant: Zongheng International Electronic Expo City http://www.cninfo.com.cn
(Suzhou) Co., Ltd. (\"Zongheng International\") As of the disclosure Announcement of
date of the report, the
Zongheng International breached the Suzhou SEG 2,460 No Inconclusive None October 14, 2016 Shenzhen SEG Co., Ltd.
Electronics Market Project Cooperation Agreement signed parties are trying to on the Acceptance of
with Suzhou SEG on June 5, 2009. According to the reach a settlement. Application for
dispute resolution terms in Article 7 (4) of the cooperation Arbitration
agreement, the Company applied for arbitration to Beijing
Arbitration Commission.
Case number: 2016 S. 0505 M. C. No. 5176 As of the disclosure http://www.cninfo.com.cn
Plaintiff: Suzhou SEG Electronics Market Co., Ltd. 1,900 No date of the report, the Inconclusive None November 19, 2016 Announcement of
Defendant: Zongheng International Electronic Expo City parties are trying to Shenzhen SEG Co., Ltd.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
(Suzhou) Co., Ltd. reach a settlement. on the Acceptance of the
A loan dispute arose between Suzhou SEG and Lawsuit Filed by the
Zongheng International. Suzhou SEG filed a lawsuit Holding Subsidiary
against Zongheng International to the court.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
XIII. Punishment and Rectification Issues
□ Applicable √ Not applicable
No punishment and rectification is involved in the report period.
XIV. Integrity of the Company and its Controlling Shareholders and Actual Controllers
□ Applicable √ Not applicable
XV. Implementation of Equity Incentive Plan, Employee Shareholding Plan or Other
Employee Incentives
□ Applicable √ Not applicable
No stock incentive plan and implementation is involved in the report period.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
XVI. Major Connected Transactions
1. Transactions Concerning Routine Operation
√ Applicable □ Not applicable
Amount
Approved Exceeding
Pricing Transaction proportion Available
transaction the Transaction
Related Association Transaction Connected principles of Transaction amount occupied in similar Disclosure
amount approved clearing Disclosure index
party relationship type transactions connected price (RMB the market date
(RMB quota or form
transactions 10,000) transactions of price
10,000) not?
the same kind
Warehouse with an
Shenzhen Determined 67.33 According
Controlling Property area of 809.26m2
SEG Group by the (Yuan/m2. 65.39 0.10% 100 No to the -
shareholder lease on 8F of SEG
Co., Ltd. market month) agreement
Plaza
The controlling
shareholder
Shenzhen entrusted its Determined According
Controlling Entrusted
SEG Group investment in SEG by the 20 20 0.03% 20 No to the - http://www.cninfo.com.cn
shareholder operation
Co., Ltd. communications market agreement Announcement of
market to the March 30, Shenzhen SEG Co., Ltd.
Company. 2016 on 2016 Expected Daily
The 15th floor of Operating Connected
Determined 71.38 According
Shenzhen Controlling Property SEG Plaza, with an Transactions
by the (Yuan/m2. 2.45 0.00% No to the -
SEG Group shareholder lease area of 687.01
market month) agreement
square meters
Shenzhen 12F (West), Block
SEG Real Subsidiary 4, SEG Science Determined 204.21 According
Property
Estate of Park (with an area by the (Yuan/m2. 74.32 0.11% 140 No to the -
lease
Investment shareholders of 909.79 square market month) agreement
Co., Ltd. meters)
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Amount
Approved Exceeding
Pricing Transaction proportion Available
transaction the Transaction
Related Association Transaction Connected principles of Transaction amount occupied in similar Disclosure
amount approved clearing Disclosure index
party relationship type transactions connected price (RMB the market date
(RMB quota or form
transactions 10,000) transactions of price
10,000) not?
the same kind
No. 2 Warehouse
Shenzhen Determined 180 According
Controlling Property covering 66.7 m2
SEG Group by the (Yuan/m2. 13.21 0.02% No to the -
shareholder lease on B1 of SEG
Co., Ltd. market month) agreement
Plaza
Total -- -- 175.37 -- 260 -- -- -- -- --
Details about return of sold goods of large amount Not applicable
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
2. Connected Transactions Due to Asset or Equity Sales and Acquisition
□ Applicable √ Not applicable
No connected transaction due to asset or equity sales and acquisition is involved in the report period.
3. Connected Transactions Due to Joint External Investment
□ Applicable √ Not applicable
No connected transaction due to joint external investment is involved in the report period.
4. Creditor's Rights and Liabilities of Related Parties
□ Applicable √ Not applicable
No creditor's rights and liabilities of related parties are involved in the report period.
5. Other Important Transactions
□ Applicable √ Not applicable
In the report period, the Company has no other major connected transactions.
XVII. Important contracts and implementation
1. Trusteeship, Contracting, and Leasing Issues
(1) Trusteeship Issues
√ Applicable □ Not applicable
Explanations to trusteeship
The controlling shareholder Shenzhen SEG Group Co., Ltd. entrust the Company to manage SEG
telecommunication market. The Company administrates the income RMB 200,000 according to the trusteeship
agreement in the report period.
Projects which bring the losses and gains that take up 10% of the profit amount of the Company.
□ Applicable √ Not applicable
In the report period, the Company has no entrusted projects which bring the losses and gains that take up 10% of
the profit amount of the Company in the report period.
(2) Contracting Issues
□ Applicable √ Not applicable
No contracting issue is involved in the report period.
(3) Leasing Issues
√ Applicable □ Not applicable
Information about lease
Refer to the preceding section Transactions Concerning Routine Operation.
Projects which bring the losses and gains that take up 10% of the profit amount of the Company in the report
period.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
□ Applicable √ Not applicable
In the report period, the Company has no lease projects which bring the losses and gains that take up 10% of the
profit amount of the Company in the report period.
2. Major guarantees
□ Applicable √ Not applicable
No guarantee issue is involved in the report period.
3. Information on cash asset management entrusted to others
(1) Entrusted financing
√ Applicable □ Not applicable
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Unit: RMB 10,000
Accrued
Principal Actual loss Actual return
Amount of provisions
Connected Remuneration amount Projected and gain of gains and
Name of trustee Product type entrusted Start date End date for
transaction or not confirmation method returned in the income amount in the losses in the
financing impairment
report period report period report period
(if any)
CITIC-CP cash
China Citic Bank No 6,000 June 4, 2015 May 13, 2016 Floating income 6,000 194.94 194.94 194.94
management No.3
The Agricultural Bank December 2, January 15,
No AXLD 20 days 3,000 Floating income 3,000 11.55 11.55 11.55
of China 2015
Shanghai Pudong Liduoduo February 14,
No 3,500 January 11, 2016 Floating income 3,500 14.71 14.71 14.71
Development Bank 2301137335
Shanghai Pudong Liduoduo
No 6,500 April 13, 2016 May 16, 2016 Floating income 6,500 23.36 23.36 23.36
Development Bank
Jinxueqiu 2015 November 28, February 3,
Industrial Bank No 2,300 Floating income 17.31
1st No. 3301C 2016
Jinxueqiu 2015 December 12, January 10,
Industrial Bank No 10,000 Floating income 32.58
1st No. 3301B 2016
Interbank December 29, January 4,
China Citic Bank No 1,000 Floating income
deposits 2016
Industrial and
SZWL1560 (93 December 28, March 30,
Commercial Bank of No 2,000 Promised income 2,000 23.44 23.44 23.44
days) 2015
China
Industrial and
SZWL1560 (93
Commercial Bank of No 3,800 April 7, 2016 July 9, 2016 Floating income 3,800 47.66 47.66 47.66
days)
China
CMB Dianjin
corporate finance
China Merchants Bank No profit increase 700 January 20, 2016 May 25, 2016 Floating income 700 9.67 9.67 9.67
series No. 61
financial plan
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Accrued
Principal Actual loss Actual return
Amount of provisions
Connected Remuneration amount Projected and gain of gains and
Name of trustee Product type entrusted Start date End date for
transaction or not confirmation method returned in the income amount in the losses in the
financing impairment
report period report period report period
(if any)
BOC wealth
accumulation September 20,
Bank of China No 500 March 1, 2016 Floating income 500 11.26 11.26 11.26
plan 2016 No.
BOC wealth
accumulation
Bank of China No 500 March 4, 2016 July 4, 2016 Floating income 500 6.35 6.35 6.35
financial plan
2016 No. 073
BOC wealth
accumulation
Bank of China No 500 April 15, 2016 August 9, 2016 Floating income 500 5.72 5.72 5.72
(fixed term of the
head office) C
BOC wealth
accumulation August 19,
Bank of China No 400 April 29, 2016 Floating income 400 4.3 4.3 4.3
(fixed term of the
head office) C
Accumulation
Bank of China No 300 May 9, 2016 May 31, 2016 Floating income 300 0.37 0.37 0.37
day by day
Wealth creation
China Merchants Bank No 100 May 10, 2016 June 23, 2016 Floating income 100 0.24 0.24 0.24
step by step 8688
Wealth creation
China Merchants Bank No 100 May 10, 2016 June 23, 2016 Floating income 100 0.42 0.42 0.42
step by step 8699
Accumulation
Bank of China No 100 May 25, 2016 May 31, 2016 Floating income 100 0.04 0.04 0.04
day by day
Wealth creation
China Merchants Bank No 700 May 27, 2016 June 23, 2016 Floating income 700 1.69 1.69 1.69
step by step 8699
Accumulation
Bank of China No 100 June 1, 2016 June 6, 2016 Floating income 100 0.03 0.03 0.03
day by day
Accumulation
Bank of China No 300 June 1, 2016 June 22, 2016 Floating income 300 0.49 0.49 0.49
day by day
China Construction Qianyuan - Silu December 29,
No 500 July 11, 2016 Floating income 500 8.45 8.45 8.45
Bank Tiantianying
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Accrued
Principal Actual loss Actual return
Amount of provisions
Connected Remuneration amount Projected and gain of gains and
Name of trustee Product type entrusted Start date End date for
transaction or not confirmation method returned in the income amount in the losses in the
financing impairment
report period report period report period
(if any)
BOC wealth
December 2,
Bank of China No accumulation 500 August 19, 2016 Floating income 500 4.89 4.89 4.89
financial plan
BOC wealth
September 13, December 9,
Bank of China No accumulation 400 Floating income 400 3.24 3.24 3.24
2016
financial plan
BOC wealth
December 5, December 30,
Bank of China No accumulation 1,400 Floating income 1,400 0.86 0.86 0.86
2016
financial plan
Qianyuan -
China Construction December 29, March 31,
No Premium 2016 500 Floating income
Bank 2016
No. 86
Bank of China, Saige
BOC stable and January 4,
Guangchang No 1,300 January 5, 2015 Promised income 1,300 68.71 68.71 68.71
smart finance
Sub-branch
Bank of China, Saige
BOC stable and March 17,
Guangchang No 1,500 March 19, 2015 Promised income 1,500 78.53 78.53 78.53
smart finance
Sub-branch
CITIC-CP Asset CITIC-CP cash
Management No management No. 1,000 July 17, 2015 May 12, 2016 Floating income 1,000 39.45 39.46 39.46
Corporation Ltd.
BOC wealth
Bank of China, Saige
accumulation
Guangchang No 1,000 July 31, 2015 July 22, 2016 Promised income 1,000 44.01 44.01 44.01
financial plan
Sub-branch
2015-047-HQ
CITIC-CP Asset CITIC-CP cash
Management No management No. 1,000 August 4, 2015 May 12, 2016 Floating income 1,000 37.37 37.37 37.37
Corporation Ltd.
Bank of China, Saige
BOC stable September 24, September 27,
Guangchang No 2,100 Promised income 2,100 97.66 97.66 97.66
income finance 2015
Sub-branch
Industrial and ICBC financial November 26, February 26,
No 100 Promised income 100 1.2 1.2 1.2
Commercial Bank of win-win and 2015
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Accrued
Principal Actual loss Actual return
Amount of provisions
Connected Remuneration amount Projected and gain of gains and
Name of trustee Product type entrusted Start date End date for
transaction or not confirmation method returned in the income amount in the losses in the
financing impairment
report period report period report period
(if any)
China, Baohua profit increase
Sub-branch
BOC wealth
Bank of China, Saige
accumulation January 6,
Guangchang No 1,300 January 8, 2016 Promised income 53.8
financial plan
Sub-branch
2016 No. 05
BOC wealth
Bank of China, Saige
accumulation March 24,
Guangchang No 1,600 March 22, 2016 Promised income 64.35
financial plan
Sub-branch
2016 No. 100
Industrial and
ICBC financial
Commercial Bank of
No win-win and 1,000 April 20, 2016 July 21, 2016 Promised income 1,000 11.72 11.72 11.72
China, Baohua
profit increase
Sub-branch
Industrial and
ICBC financial
Commercial Bank of August 23,
No win-win and 1,000 May 23, 2016 Promised income 1,000 11.21 11.21 11.21
China, Baohua
profit increase
Sub-branch
Industrial and
ICBC financial
Commercial Bank of October 28,
No win-win and 1,000 July 28, 2016 Promised income 1,000 10.67 10.67 10.67
China, Baohua
profit increase
Sub-branch
Industrial and
ICBC financial
Commercial Bank of November 25,
No win-win and 1,500 August 25, 2016 Promised income 1,500 15.23 15.23 15.23
China, Baohua
profit increase
Sub-branch
Industrial and
ICBC financial
Commercial Bank of September 29, December 30,
No win-win and 2,500 Promised income 24.84
China, Baohua 2016
profit increase
Sub-branch
Industrial and
ICBC financial
Commercial Bank of November 3, February 3,
No win-win and 1,000 Promised income 9.43
China, Baohua 2016
profit increase
Sub-branch
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Accrued
Principal Actual loss Actual return
Amount of provisions
Connected Remuneration amount Projected and gain of gains and
Name of trustee Product type entrusted Start date End date for
transaction or not confirmation method returned in the income amount in the losses in the
financing impairment
report period report period report period
(if any)
Industrial and
ICBC financial
Commercial Bank of November 29,
No win-win and 1,500 March 1, 2017 Promised income 14.91
China, Baohua
profit increase
Sub-branch
PAB Tiantianli
guaranteed RMB December 12, January 21,
Ping An Bank No 1,200 Promised income 1,200 1.75 1.75 1.75
corporate 2015
financial product
PAB Tiantianli
guaranteed RMB December 29, January 21,
Ping An Bank No 2,100 Promised income 2,100 3.05 3.05 3.05
corporate 2015
financial product
PAB Tiantianli
guaranteed RMB December 31, February 1,
Ping An Bank No 1,000 Promised income 1,000 1.45 1.45 1.45
corporate 2015
financial product
BOC
accumulation day
Bank of China,
by day - daily December 14, January 27,
Nantong Gangzha No 900 Promised income 900 1.74 1.74 1.74
plan 2015
Sub-branch
productGSRJYL0
BOC
accumulation day
Bank of China,
by day - daily January 27,
Nantong Gangzha No 2,000 January 12, 2016 Promised income 2,000 2.3 2.3 2.30
plan
Sub-branch
productGSRJYL0
BOC
accumulation day
Bank of China,
by day - daily February 1,
Nantong Gangzha No 500 January 28, 2016 Promised income 500 0.15 0.15 0.15
plan
Sub-branch
productGSRJYL0
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Accrued
Principal Actual loss Actual return
Amount of provisions
Connected Remuneration amount Projected and gain of gains and
Name of trustee Product type entrusted Start date End date for
transaction or not confirmation method returned in the income amount in the losses in the
financing impairment
report period report period report period
(if any)
BOC
accumulation day
Bank of China,
by day - daily
Nantong Gangzha No 1,000 May 6, 2016 July 15, 2016 Promised income 1,000 0.78 0.78 0.78
plan
Sub-branch
productGSRJYL0
BOC
accumulation day
Bank of China,
by day - daily August 12,
Nantong Gangzha No 700 July 8, 2016 Promised income 700 0.87 0.87 0.87
plan
Sub-branch
productGSRJYL0
BOC
accumulation day
Bank of China,
by day - daily August 18,
Nantong Gangzha No 500 July 26, 2016 Promised income 500 0.67 0.67 0.67
plan
Sub-branch
productGSRJYL0
BOC
accumulation day
Bank of China,
by day - daily September 14,
Nantong Gangzha No 700 August 23, 2016 Promised income 700 0.55 0.55 0.55
plan
Sub-branch
productGSRJYL0
BOC
accumulation day
Bank of China,
by day - daily September 27, December 16,
Nantong Gangzha No 800 Promised income 800 1.63 1.63 1.63
plan 2016
Sub-branch
productGSRJYL0
BOC
Bank of China, accumulation day November 25,
Nantong Gangzha No by day - daily 1,500 June 30, 2017 Promised income 700 1.52 1.52
Sub-branch plan
productGSRJYL0
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Accrued
Principal Actual loss Actual return
Amount of provisions
Connected Remuneration amount Projected and gain of gains and
Name of trustee Product type entrusted Start date End date for
transaction or not confirmation method returned in the income amount in the losses in the
financing impairment
report period report period report period
(if any)
Industrial and Guaranteed
Commercial Bank of 35-day stable February 16, Guaranteed and
No 30 January 8, 2016 30 0.09 0.09 0.09
China, Sipailou income RMB 2016 floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable February 16, Guaranteed and
No 30 January 8, 2016 30 0.09 0.09 0.09
China, Sipailou income RMB 2016 floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable February 16, Guaranteed and
No 30 January 8, 2016 30 0.09 0.09 0.09
China, Sipailou income RMB 2016 floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable February 16, Guaranteed and
No 30 January 8, 2016 30 0.09 0.09 0.09
China, Sipailou income RMB 2016 floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable February 16, Guaranteed and
No 30 January 8, 2016 30 0.09 0.09 0.09
China, Sipailou income RMB 2016 floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable February 16, Guaranteed and
No 30 January 8, 2016 30 0.09 0.09 0.09
China, Sipailou income RMB 2016 floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable February 16, Guaranteed and
No 20 January 8, 2016 20 0.06 0.06 0.06
China, Sipailou income RMB 2016 floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable Guaranteed and
No 30 March 25, 2016 June 2, 2016 30 0.16 0.16 0.16
China, Sipailou income RMB floating income
Sub-branch corporate finance
Industrial and No Guaranteed 30 March 25, 2016 June 2, 2016 Guaranteed and 30 0.16 0.16 0.16
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Accrued
Principal Actual loss Actual return
Amount of provisions
Connected Remuneration amount Projected and gain of gains and
Name of trustee Product type entrusted Start date End date for
transaction or not confirmation method returned in the income amount in the losses in the
financing impairment
report period report period report period
(if any)
Commercial Bank of 35-day stable floating income
China, Sipailou income RMB
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable Guaranteed and
No 30 March 25, 2016 June 2, 2016 30 0.16 0.16 0.16
China, Sipailou income RMB floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable Guaranteed and
No 30 March 25, 2016 June 2, 2016 30 0.16 0.16 0.16
China, Sipailou income RMB floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable Guaranteed and
No 30 July 5, 2016 August 9, 2016 30 0.08 0.08 0.08
China, Sipailou income RMB floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable Guaranteed and
No 30 July 5, 2016 August 9, 2016 30 0.08 0.08 0.08
China, Sipailou income RMB floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable Guaranteed and
No 30 July 5, 2016 August 9, 2016 30 0.08 0.08 0.08
China, Sipailou income RMB floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable Guaranteed and
No 30 July 5, 2016 August 9, 2016 30 0.08 0.08 0.08
China, Sipailou income RMB floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable September 20, Guaranteed and
No 30 August 16, 2016 30 0.07 0.07 0.07
China, Sipailou income RMB 2016 floating income
Sub-branch corporate finance
Industrial and Guaranteed September 20, Guaranteed and
Commercial Bank of No 35-day stable 30 August 16, 2016 30 0.07 0.07 0.07
2016 floating income
China, Sipailou income RMB
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Accrued
Principal Actual loss Actual return
Amount of provisions
Connected Remuneration amount Projected and gain of gains and
Name of trustee Product type entrusted Start date End date for
transaction or not confirmation method returned in the income amount in the losses in the
financing impairment
report period report period report period
(if any)
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable September 20, Guaranteed and
No 30 August 16, 2016 30 0.07 0.07 0.07
China, Sipailou income RMB 2016 floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable September 20, Guaranteed and
No 30 August 16, 2016 30 0.07 0.07 0.07
China, Sipailou income RMB 2016 floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable September 20, Guaranteed and
No 30 August 16, 2016 30 0.07 0.07 0.07
China, Sipailou income RMB 2016 floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable September 20, Guaranteed and
No 30 August 16, 2016 30 0.07 0.07 0.07
China, Sipailou income RMB 2016 floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable September 20, Guaranteed and
No 30 August 16, 2016 30 0.07 0.07 0.07
China, Sipailou income RMB 2016 floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable November 18, Guaranteed and
No 30 October 14, 2016 30 0.07 0.07 0.07
China, Sipailou income RMB 2016 floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable November 18, Guaranteed and
No 30 October 14, 2016 30 0.07 0.07 0.07
China, Sipailou income RMB 2016 floating income
Sub-branch corporate finance
Industrial and Guaranteed
Commercial Bank of 35-day stable November 18, Guaranteed and
No 30 October 14, 2016 30 0.07 0.07 0.07
China, Sipailou income RMB 2016 floating income
Sub-branch corporate finance
Industrial and No \"Ever increasing\" 30 January 13, 2016 June 30, 2017 Non-guaranteed and 30 0.32 0.32 0.32
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Accrued
Principal Actual loss Actual return
Amount of provisions
Connected Remuneration amount Projected and gain of gains and
Name of trustee Product type entrusted Start date End date for
transaction or not confirmation method returned in the income amount in the losses in the
financing impairment
report period report period report period
(if any)
Commercial Bank of earning corporate floating income
China, Sipailou finance
Sub-branch
Industrial and
\"Ever increasing\"
Commercial Bank of Non-guaranteed and
No earning corporate 30 January 13, 2016 June 30, 2017 30 0.32 0.32 0.32
China, Sipailou floating income
finance
Sub-branch
Industrial and
\"Ever increasing\"
Commercial Bank of Non-guaranteed and
No earning corporate 30 January 15, 2016 June 30, 2017 30 0.32 0.32 0.32
China, Sipailou floating income
finance
Sub-branch
Industrial and
\"Ever increasing\"
Commercial Bank of Non-guaranteed and
No earning corporate 30 January 15, 2016 June 30, 2017 30 0.32 0.32 0.32
China, Sipailou floating income
finance
Sub-branch
Industrial and
\"Ever increasing\"
Commercial Bank of February 26, Non-guaranteed and
No earning corporate 30 June 30, 2017 30 0.83 0.83 0.83
China, Sipailou 2016 floating income
finance
Sub-branch
Industrial and
\"Ever increasing\"
Commercial Bank of February 26, Non-guaranteed and
No earning corporate 30 June 30, 2017 30 0.83 0.83 0.83
China, Sipailou 2016 floating income
finance
Sub-branch
Industrial and
\"Ever increasing\"
Commercial Bank of February 26, Non-guaranteed and
No earning corporate 30 June 30, 2017 30 0.83 0.83 0.83
China, Sipailou 2016 floating income
finance
Sub-branch
Industrial and
\"Ever increasing\"
Commercial Bank of February 26, Non-guaranteed and
No earning corporate 30 June 30, 2017 30 0.83 0.83 0.83
China, Sipailou 2016 floating income
finance
Sub-branch
Industrial and \"Ever increasing\"
February 26, Non-guaranteed and
Commercial Bank of No earning corporate 20 June 30, 2017 20 0.55 0.55 0.55
2016 floating income
China, Sipailou finance
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Accrued
Principal Actual loss Actual return
Amount of provisions
Connected Remuneration amount Projected and gain of gains and
Name of trustee Product type entrusted Start date End date for
transaction or not confirmation method returned in the income amount in the losses in the
financing impairment
report period report period report period
(if any)
Sub-branch
Industrial and
\"Ever increasing\"
Commercial Bank of Non-guaranteed and
No earning corporate 30 March 22, 2016 June 30, 2017 30 0.76 0.76 0.76
China, Sipailou floating income
finance
Sub-branch
Industrial and
\"Ever increasing\"
Commercial Bank of Non-guaranteed and
No earning corporate 30 March 31, 2016 June 30, 2017 30 0.74 0.74 0.74
China, Sipailou floating income
finance
Sub-branch
Industrial and
\"Ever increasing\"
Commercial Bank of Non-guaranteed and
No earning corporate 30 March 31, 2016 June 30, 2017 30 0.74 0.74 0.74
China, Sipailou floating income
finance
Sub-branch
Industrial and
\"Ever increasing\"
Commercial Bank of Non-guaranteed and
No earning corporate 30 March 31, 2016 June 30, 2017 30 0.74 0.74 0.74
China, Sipailou floating income
finance
Sub-branch
Industrial and
\"Ever increasing\"
Commercial Bank of Non-guaranteed and
No earning corporate 30 April 1, 2016 June 30, 2017 30 0.73 0.73 0.73
China, Sipailou floating income
finance
Sub-branch
Industrial and
\"Ever increasing\"
Commercial Bank of Non-guaranteed and
No earning corporate 30 April 1, 2016 June 30, 2017 30 0.73 0.73 0.73
China, Sipailou floating income
finance
Sub-branch
BOC stable
financial plan - February 18,
Bank of China No 800 August 20, 2015 Promised income 800 17.15 17.15 17.15
smart series
Q15558
BOC Jizhitong
financial plan -
September 22,
Bank of China No liquidity 700 March 4, 2016 Promised income 700 0 13.37 13.37
enhancement
series A15603
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Accrued
Principal Actual loss Actual return
Amount of provisions
Connected Remuneration amount Projected and gain of gains and
Name of trustee Product type entrusted Start date End date for
transaction or not confirmation method returned in the income amount in the losses in the
financing impairment
report period report period report period
(if any)
BOC Jizhitong
financial plan -
November 27, January 26,
Bank of China No liquidity 500 Promised income 500 0 3.25 3.25
2015
enhancement
series A15761
BOC stable
financial plan - March 10,
Bank of China No 600 February 1, 2016 Promised income 600 0 2.34 2.34
smart series
Q16032-G
BOC stable
financial plan - February 22,
Bank of China No 750 April 7, 2016 Promised income 750 0 3.42 3.42
smart series
Q16057-G
BOC stable
financial plan -
Bank of China No 300 January 18, 2016 May 9, 2016 Promised income 300 0 3.68 3.68
smart series
Q16008-G
BOC stable
financial plan -
Bank of China No 700 March 7, 2016 June 2, 2016 Promised income 700 0 6.34 6.34
smart series
Q16082-G
BOC stable and
smart financial
Bank of China No 650 March 14, 2016 June 27, 2016 Promised income 650 0 7.11 7.11
plan 2016 No.
BOC wealth
accumulation August 23,
Bank of China No 200 May 17, 2016 Promised income 200 0 1.88 1.88
financial plan
2016 No. 178
BOC stable and
smart financial September 1,
Bank of China No 300 June 30, 2016 Promised income 300 0 1.81 1.81
plan 2016 No.
227-G
Bank of China No BOC stable 450 April 14, 2016 October 20, Promised income 450 0 8.62 8.62
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Accrued
Principal Actual loss Actual return
Amount of provisions
Connected Remuneration amount Projected and gain of gains and
Name of trustee Product type entrusted Start date End date for
transaction or not confirmation method returned in the income amount in the losses in the
financing impairment
report period report period report period
(if any)
financial plan -
smart series
Q16152-G
BOC stable
financial plan - November 28,
Bank of China No 700 June 6, 2016 Promised income 700 0 11.91 11.91
smart series
Q16253-G
BOC stable
financial plan -
Bank of China No 400 June 30, 2016 June 22, 2017 Promised income 14.87
smart series
Q16301-G
BOC wealth
accumulation March 10,
Bank of China No 200 August 26, 2016 Promised income 3.71
financial plan
2016 No. 319
BOC stable
financial plan - September 8, March 13,
Bank of China No 150 Promised income 2.64
smart series 2016
Q16437-G
BOC stable
financial plan - October 19,
Bank of China No 400 October 24, 2016 Promised income 14.2
smart series
Q16514-G
BOC stable and
smart financial December 1,
Bank of China No 800 May 25, 2017 Promised income 14.19
plan 2016 No.
473-G
BOC stable
financial plan -
January 21,
Bank of China No smart series 400 October 22, 2015 Floating income 400 4.19 4.19 4.19
(AMZYPWHQ15
711)
Shanghai Pudong Product code - January 25,
No 400 October 28, 2015 Floating income 400 4.54 4.54 4.54
Development Bank 2301137337;
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Accrued
Principal Actual loss Actual return
Amount of provisions
Connected Remuneration amount Projected and gain of gains and
Name of trustee Product type entrusted Start date End date for
transaction or not confirmation method returned in the income amount in the losses in the
financing impairment
report period report period report period
(if any)
product name -
Liduoduo Wealth
Bus Progress No.
Product code -
2301137338;
Shanghai Pudong product name - November 21,
No 400 May 23, 2016 Floating income 400 8.78 8.78 8.78
Development Bank Liduoduo Wealth
Bus Progress No.
Product code -
2301137335;
Shanghai Pudong January 15,
No product name - 400 December 16, Floating income 400 1.46 1.46 1.46
Development Bank
Monthly profit
increase
Product code -
2301137338;
Shanghai Pudong
No product name - 400 January 19, 2016 July 21, 2016 Floating income 400 8.93 8.93 8.93
Development Bank
Wealth Bus
Progress No. 4
BOC stable
financial plan -
Bank of China No smart series 300 January 25, 2016 July 18, 2016 Floating income 300 6 6 6.00
(AMZYPWHQ60
23-G)
Product code -
2301137338;
Shanghai Pudong
No product name - 400 February 2, 2016 August 2, 2016 Floating income 400 8.73 8.73 8.73
Development Bank
Wealth Bus
Progress No. 4
Product code -
2301137336;
Shanghai Pudong September 25,
No product name - 400 July 27, 2016 Floating income 400 2.44 2.44 2.44
Development Bank
Wealth Bus
Progress No. 2
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Accrued
Principal Actual loss Actual return
Amount of provisions
Connected Remuneration amount Projected and gain of gains and
Name of trustee Product type entrusted Start date End date for
transaction or not confirmation method returned in the income amount in the losses in the
financing impairment
report period report period report period
(if any)
Product code -
2301137337;
Shanghai Pudong November 3,
No product name - 400 August 4, 2016 Floating income 400 3.55 3.55 3.55
Development Bank
Wealth Bus
Progress No. 3
Product code -
2301137337;
Shanghai Pudong September 2, December 2,
No product name - 400 Floating income 400 3.55 3.55 3.55
Development Bank 2016
Wealth Bus
Progress No. 3
Product code -
2301137338;
Shanghai Pudong September 29, March 25,
No product name - 400 Floating income 7.08
Development Bank 2016
Wealth Bus
Progress No. 4
Product code -
2301137337;
Shanghai Pudong November 4, February 1,
No product name - 600 Floating income 5.19
Development Bank 2016
Wealth Bus
Progress No. 3
Product code -
2301137337;
Shanghai Pudong December 7,
No product name - 800 March 8, 2017 Floating income 7.58
Development Bank
Wealth Bus
Progress No. 4
Bank of YTCF-RZL
No 100 January 11, 2016 April 11, 2016 Promised income 100 0.93 0.93 0.93
Communications
Bank of YTCF-RZL
No 100 February 1, 2016 May 3, 2016 Promised income 100 0.92 0.92 0.92
Communications
Bank of YTCF-RZL
No 100 March 7, 2016 June 7, 2016 Promised income 100 0.86 0.86 0.86
Communications
Bank of YTCF-RZL October 17,
No 200 April 18, 2016 Promised income 200 3.39 3.39 3.39
Communications 2171161068
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Accrued
Principal Actual loss Actual return
Amount of provisions
Connected Remuneration amount Projected and gain of gains and
Name of trustee Product type entrusted Start date End date for
transaction or not confirmation method returned in the income amount in the losses in the
financing impairment
report period report period report period
(if any)
Bank of YTCF-RZL August 16,
No 200 May 16, 2016 Promised income 200 1.71 1.71 1.71
Communications 2171161335
Golden years August 16,
China Merchants Bank No 150 June 21, 2016 Guaranteed 150 0.75 0.75 0.75
51422
Golden years November 4,
China Merchants Bank No 100 July 15, 2016 Guaranteed 100 0.91 0.91 0.91
51429
PAB Tiantianli
guaranteed RMB December 12, January 21,
Ping An Bank No 1,200 Promised income 1,200 1.75 1.75 1.75
corporate 2015
financial product
PAB Tiantianli
guaranteed RMB December 29, January 21,
Ping An Bank No 2,100 Promised income 2,100 3.05 3.05 3.05
corporate 2015
financial product
PAB Tiantianli
guaranteed RMB December 31, February 1,
Ping An Bank No 1,000 Promised income 1,000 1.45 1.45 1.45
corporate 2015
financial product
Industrial and 63-day stable
January 1,
Commercial Bank of No income corporate 200 October 30, 2015 Promised income 200 1.23 1.23 1.23
China finance
Industrial and 63-day stable
November 24, January 26,
Commercial Bank of No income corporate 200 Promised income 200 1.09 1.09 1.09
2015
China finance
Industrial and 63-day stable
November 26, January 28,
Commercial Bank of No income corporate 230 Promised income 230 1.83 1.83 1.83
2015
China finance
Abundant
The Agricultural Bank November 27, February 25,
No principal and 550 Promised income 550 4.41 4.41 4.41
of China 2015
interest 90-day
Ease express
The Agricultural Bank February 29, March 14,
No daily compound 550 Promised income 550 0.49 0.49 0.49
of China 2016
interest
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Accrued
Principal Actual loss Actual return
Amount of provisions
Connected Remuneration amount Projected and gain of gains and
Name of trustee Product type entrusted Start date End date for
transaction or not confirmation method returned in the income amount in the losses in the
financing impairment
report period report period report period
(if any)
The Agricultural Bank Daily compound March 29,
No 550 March 14, 2016 Promised income 550 0.65 0.65 0.65
of China interest No. 2
Industrial and
0701CDOB
Commercial Bank of No 220 March 9, 2016 July 1, 2016 Promised income 220 1.72 1.72 1.71
finance
China
The Agricultural Bank Daily compound
No 400 April 6, 2016 July 1, 2016 Promised income 400 2.09 2.09 2.09
of China interest No. 2
Industrial and
0701CDOB
Commercial Bank of No 200 May 10, 2016 July 13, 2016 Promised income 200 0.43 0.43 0.43
finance
China
Industrial and
0701CDOB December 1,
Commercial Bank of No 100 June 12, 2016 Promised income 100 0.8 0.8 0.80
finance
China
Industrial and
0701CDOB August 26,
Commercial Bank of No 400 July 21, 2016 Promised income 400 0.63 0.63 0.63
finance
China
Industrial and
0701CDOB December 2,
Commercial Bank of No 300 August 30, 2016 Promised income 300 1.31 1.31 1.31
finance
China
Industrial and
0701CDOB December 16, Guaranteed and
Commercial Bank of No 100 June 30, 2017
finance 2016 floating income
China
B160C0169-Win-
December 2, December 6, Guaranteed and
China Citic Bank No win guaranteed 1,500 1,200 1.22 1.22
2016 2016 floating income
Tiantiankuai A
Total 105,230 -- -- -- 78,580 1,204.63 984.43 --
Source of fund for entrusted financing Own fund
Past-due amount of principal and income recoverable
Lawsuit (if applicable) Not applicable
Disclosure date of the announcement of the Board of
Directors on the approval of entrusted financing (if any)
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Accrued
Principal Actual loss Actual return
Amount of provisions
Connected Remuneration amount Projected and gain of gains and
Name of trustee Product type entrusted Start date End date for
transaction or not confirmation method returned in the income amount in the losses in the
financing impairment
report period report period report period
(if any)
Disclosure date of the announcement of the shareholder
meeting on the approval of entrusted financing (if any)
Is there any entrusted financing plan in the future? Yes
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
(2) Entrusted loaning
□ Applicable √ Not applicable
No entrusted loaning is involved in the report period.
4. Other Important Contracts
√ Applicable □ Not applicable
Book
value
of
Conne
assets Apprais
Contrac Contrac cted
Counter Date of involve al Pricing Associa
ting t transa Implementation as of the end of the report period
party signing d in the agency principle tion
party subject ction
contract (if any)
or not
(RMB
10,000)
(if any)
At the 15th interim meeting of the 6th Board of
Directors on July 29, 2014, the Company reviewed
and approved the Proposal for Adding the Working
Shenzh
Capital Loan of RMB 10,000,000 to Shenzhen SEG
en SEG
Shenzh Loan of Industrial Investment Co., Ltd. The Company
Industri
en SEG RMB July 29, Without provided the working capital loan of RMB
al 4,200 N/A No N/A
Co., 42 2014 interest 10,000,000 for the wholly-owned subsidiary
Investm
Ltd. million Shenzhen SEG Industrial Investment Co., Ltd. As a
ent Co.,
result, SEG Industry has borrowed RMB 42,000,000
Ltd.
in total from the Company, which bears no interest.
As of the end of the report period, the foregoing
contract is in progress.
At the 23rd interim meeting of the 6th Board of
Directors on May 27, 2015, the Company reviewed
Suzhou
and approved the Proposal for Providing the
SEG Financial Aid of RMB 10,000,000 for Suzhou SEG
Shenzh Digital Loan of Digital Plaza Management Co., Ltd. The Company
May
en SEG Plaza RMB Without provided the loan of RMB 10,000,000 for the
27, 1,000 N/A No N/A
Co., Manage 10 interest wholly-owned subsidiary Shenzhen SEG Industrial
Ltd. ment million Investment Co., Ltd. to meet its development needs.
The foregoing loan bears no interest and the term is
Co.,
two years (from June 8, 2015 to June 7, 2017). As of
Ltd. the end of the report period, the foregoing contract is
in progress.
At the 3rd interim meeting of the 6th Board of
Directors on October 14, 2013, the Company
reviewed and approved the Proposal for Providing
the Financial Aid of RMB 10,000,000 for Shenzhen
SEG E-Commerce Co., Ltd. The term of loan was
one year (from September 15, 2013 to September 14,
2014). The loan was paid based on the need of
e-commerce business. SEG E-commerce paid the
Shenzh capital occupancy fee to the Company based on the
Shenzh en SEG Loan of actual amount and term of loan at the benchmark
Novem
en SEG E-Com RMB interest rate of one-year bank loan in the same
ber 10, 6,000 No N/A
Co., merce 60 period, and repaid the loan on the due date. At the
Ltd. Co., million 5th interim meeting of the 6th Board of Directors on
December 5, 2014, the Company reviewed and
Ltd.
approved the Proposal for Providing the Financial
Aid of RMB 60,000,000 for Shenzhen SEG
E-Commerce Co., Ltd. This was borrowing renewal
and the term of loan is one year. SEG E-commerce
paid the capital occupancy fee to all shareholders as
the creditors based on the actual amount and term of
loan at 6.5%. As of the end of the report period, SEG
E-commerce has repaid the foregoing loan.
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
XVIII. Social Responsibility
1. Fulfillment of the social responsibility for targeted poverty alleviation
√ Applicable □ Not applicable
According to the decision of central government to win the fight against poverty and the work arrangements of
Shenzhen CPC Committee, the People's Government of Shenzhen, State-owned Assets Supervision and
Administration Commission of Shenzhen, and SEG Group on three-year targeted poverty alleviation, SEG
Group was designated to provide poverty alleviation aid for Zishi Village, Zishi Town, Longchuan County,
Heyuan. After receiving the assignment, the CPC Committee and leaders of the Company fully realized the
importance, arduousness and urgency of poverty alleviation and development in the new period. Our thoughts
and actions followed spirits conveyed by important talks of Xi Jinping, CPC General Secretary and decisions and
arrangements on targeted poverty alleviation of government at all levels and the upper CPC committee. SEG
Group promptly appointed the leader of the work team and arranged for special personnel to stay at villages for
poverty alleviation. In 2016, the CPC Committee and relevant branches of the Company visited five families
with financial difficulties in Zishi Village for field research, extended regards to them, and assisted the work
team in the village in carrying out poverty alleviation. In 2016, the Company has investigated the conditions of
poverty alleviation households, developed the poverty alleviation plan, and decomposed tasks of each poverty
alleviation stage. All work is progressing as planned to ensure the accomplishment of poverty alleviation goals of
Guangdong CPC Committee and People's Government of Guangdong Province by the end of 2018, namely
\"rural poor people do not have to worry about food or clothing; compulsory education, basic medical care, and
housing security are guaranteed; the basic indicators of basic public services are equivalent to the average level
of Guangdong Province\".
2. Fulfillment of other social responsibilities
Are the listed company and its subsidiaries on the list of key pollutant discharging enterprises released by the environment
protection department?
No.
Is a social responsibility report published?
□ Yes √ No
XIX. Notes on Other Important Matters
√ Applicable □ Not applicable
Inquiry Index for the Websites Disclosing
Overview of Important Events Disclosure Date
the Temporary Reports
1. Matters concerning the establishment of SEG Announcement of Shenzhen SEG Co., Ltd. on
Intelligent Technology Co., Ltd. the Establishment of Shenzhen SEG
January 13, 2016
Intelligent Technology Co. Ltd. disclosed on
http://www.cninfo.com.cn
2. Matters concerning the conclusion of the strategic Announcement on the Conclusion of the
cooperation agreement with Taobao (China) Software Strategic Cooperation Agreement with
January 28, 2016
Co., Ltd. Taobao (China) Software Co., Ltd. disclosed
on http://www.cninfo.com.cn
3. Matters concerning major assets restructuring plan Announcement on Resolutions of the 8th
February 4, 2016 Meeting of the 6th Board of Directors
disclosed on http://www.cninfo.com.cn
Warning Announcement on No Resumption
February 4, 2016 of Trading of the Company's Stocks disclosed
on http://www.cninfo.com.cn
February 4, 2016 Warning Announcement on General Risks of
Major Asset Restructuring disclosed on
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
http://www.cninfo.com.cn
Announcement on Share Issuance and Cash
Payment to Acquire Assets and Raise Funds
February 4, 2016 & Non-diluted Earnings Per Share of
Connected Transactions disclosed on
http://www.cninfo.com.cn
4. Matters concerning the conclusion of the strategic Announcement on the Conclusion of the
cooperation agreement with Shanghai Wangyu Strategic Cooperation Agreement with
Information Technology Co., Ltd. March 15, 2016 Shanghai Wangyu Information Technology
Co., Ltd. disclosed on
http://www.cninfo.com.cn
5. Matters concerning the conclusion of the strategic Announcement on the Conclusion of the
cooperation agreement with Fujian Babycat Animation Strategic Cooperation Agreement with
March 24, 2016
Technology Co., Ltd. Fujian Babycat Animation Technology Co.,
Ltd. disclosed on http://www.cninfo.com.cn
6. Matters concerning the conclusion of strategic Announcement on the Conclusion of the
cooperation agreements with related parties and Strategic Cooperation Agreement with
Shenzhen Tencent Computer System Co., Ltd. April 6, 2016 Related Parties and Shenzhen Tencent
Computer System Co., Ltd. disclosed on
http://www.cninfo.com.cn
7. Matters concerning the conclusion of the strategic Announcement on the Conclusion of the
cooperation agreement with Zhejiang Tmall Technology Strategic Cooperation Agreement with
April 9, 2016
Co., Ltd. Zhejiang Tmall Technology Co., Ltd.
disclosed on http://www.cninfo.com.cn
8. Matters concerning the cooperation between the Announcement on the Cooperation
controlling subsidiary and Shenzhen Capital Group between the Controlling Subsidiary and
Co., Ltd. on the setup of an investment management Shenzhen Capital Group Co., Ltd. on the
company and establishment of Shenzhen Hongtu Setup of an Investment Management
SEG Intelligent Industrial Investment Fund April 19, 2016 Company and Establishment of
(Limited Partnership) Shenzhen Hongtu SEG Intelligent
Industrial Investment Fund (Limited
Partnership) disclosed on
http://www.cninfo.com.cn
9. Matters concerning the Company's application for Announcement on Resolutions of the
the general credit limit for RMB loans 34th Interim Meeting of the 6th Board of
April 26, 2016
Directors disclosed on
http://www.cninfo.com.cn
10. Matters concerning foreign investment and Announcement on Foreign Investment
establishment of Shenzhen SEG Longyan New and Establishment of SEG Longyan New
Energy Application and Development Co., Ltd. May 10, 2016 Energy Application and Development
Co., Ltd. disclosed on
http://www.cninfo.com.cn
Announcement on Shenzhen SEG Longyan
New Energy Application and Development
June 1, 2016 Co., Ltd.'s Acquisition of the Business
License disclosed on
http://www.cninfo.com.cn
11. Matters concerning equity investment and Announcement on Equity Investment and
establishment of Shenzhen International Consumer Establishment of Shenzhen International
Electronics Exhibition/Exchange Center Co., Ltd. May 12, 2016 Consumer Electronics Exhibition/Exchange
Center Co., Ltd. disclosed on
http://www.cninfo.com.cn
12. Matters concerning the alteration of registered Announcement on Resolutions of the 37th
capital of Shenzhen Hongtu SEG Investment Interim Meeting of the 6th Board of
June 25, 2016
Management Co., Ltd. Directors disclosed on
http://www.cninfo.com.cn
13. Matters concerning the major assets Report of Share Issuance and Cash
restructuring process Payment to Acquire Assets and Raise Funds
August 4, 2016
& Connected Transactions disclosed on
http://www.cninfo.com.cn
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Announcement on the Approval of
State-owned Assets Supervision and
August 26, 2016 Administration Commission of Shenzhen on
the Major Assets Restructuring Plan
disclosed on http://www.cninfo.com.cn
Announcement on Recordation of the Asset
Appraisal Report Related to Major Assets
Restructuring by State-owned Assets
August 27, 2016
Supervision and Administration
Commission of Shenzhen disclosed on
http://www.cninfo.com.cn
Announcement on Receipt of the Notice of
the CSRC on Acceptance of Administrative
September 14, 2016 Licensing Application Concerning the
Major Assets Restructuring disclosed on
http://www.cninfo.com.cn
Announcement on Receipt of the Notice of
the CSRC on Primary Feedback Opinion
for Review of Administrative Licensing
October 10, 2016
Items Concerning the Major Assets
Restructuring disclosed on
http://www.cninfo.com.cn
Announcements of Reply to the Notice of
the CSRC on Primary Feedback Opinion
for Review of Administrative Licensing and
November 4, 2016 Report of Share Issuance and Cash
Payment to Acquire Assets and Raise Funds
& Connected Transactions (Revision)
disclosed on http://www.cninfo.com.cn
Announcement on the Review Reply of the
M&A and Restructuring Review Committee
of the CSRC on Major Assets Restructuring
November 22, 2016 and Report of Share Issuance and Cash
Payment to Acquire Assets and Raise Funds
& Connected Transactions (Revision)
disclosed on http://www.cninfo.com.cn
14. Matters concerning Shenzhen Hongtu SEG Announcement on Shenzhen Hongtu SEG
Investment Management Co., Ltd.'s acquisition of the Investment Management Co., Ltd.'s
September 1, 2016
business license Acquisition of the Business License
disclosed on http://www.cninfo.com.cn
15. Matters concerning progress of strategic cooperation Announcement on Progress of Strategic
between the Company and Taobao (China) Software Cooperation between the Company and
September 22, 2016
Co., Ltd. Taobao (China) Software Co., Ltd.
disclosed on http://www.cninfo.com.cn
16. Matters concerning the Company's receipt of court Announcement on Receipt of Court
summons and the civil complaint September 29, 2016 Summons and the Civil Complaint
disclosed on http://www.cninfo.com.cn
17. Matters concerning the acceptance of the Company's Announcement on the Acceptance of
application for arbitration Application for Arbitration disclosed on
Beijing Arbitration Commission accepted the http://www.cninfo.com.cn
October 14, 2016
Company's application for arbitration with Zongheng
International Expo City (Suzhou) Co., Ltd. as the
respondent
18. Matters concerning the reduction of holding-shares Announcement on Resolutions of the 5th
of Shenzhen Huakong SEG Co., Ltd. October 25, 2016 Interim Meeting of the 7th Board of
October 26, 2016 Directors disclosed on
http://www.cninfo.com.cn
Announcement on the Reduction of Stock
December 31, 2016 Equity of Shenzhen Huakong SEG Co., Ltd.
disclosed on http://www.cninfo.com.cn
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
19. Matters concerning the establishment of SEG Announcement on the Establishment of
Longyan Energy Technology Co., Ltd. and launch of SEG Longyan Energy Technology Co., Ltd.
CdTe film photovoltaic industrial base November 12, 2016 and Launch of CdTe Film Photovoltaic
Industrial Base disclosed on
http://www.cninfo.com.cn
20. Matters concerning the progress of the Company's Announcement on Stock Equity Transfer of
transfer of the equity of Shenzhen SEG E-commerce December 15, 2016 Shenzhen SEG E-commerce Co., Ltd.
Co., Ltd. disclosed on http://www.cninfo.com.cn
21. Matters concerning the acquisition of 2% of the Announcement on the Connected
equity of Shenzhen SEG Credit Co., Ltd. held by Transaction of Acquisition of 2% of the
Shenzhen SEG E-commerce Co., Ltd. Stock Equity of Shenzhen SEG Credit Co.,
December 15, 2016
Ltd. Held by Shenzhen SEG E-commerce
Co., Ltd. disclosed on
http://www.cninfo.com.cn
22. Matters concerning the conclusion of the strategic Announcement on the Conclusion of the
cooperation agreement with Tianjin Allied eSports Strategic Cooperation Agreement with
Internet Technology Co., Ltd. December 15, 2016 Tianjin Allied eSports Internet Technology
Co., Ltd. disclosed on
http://www.cninfo.com.cn
23. Matters concerning the establishment of Shenzhen Announcement on the Establishment of
SEG Allied eSports Co., Ltd. and operation of e-sport Shenzhen SEG Allied eSports Co., Ltd. and
December 16, 2016
venue Operation of E-sport Venue disclosed on
http://www.cninfo.com.cn
XX. Important Matters of Subsidiaries
□ Applicable √ Not applicable
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
Chapter 6 Changes in Share Capital and Information on
Shareholders
I. Information on Changes in Share Capital
1. Changes of shares
Unit: Share
Before the change Increase/decrease by (+, -) After the change
New Capitalization
Bonus
Quantity Percentage share of public Others Subtotal Quantity Percentage
share
offering reserve
I. Restricted shares 71,689 0.01% 0 0 0 5,750 5,750 77,439 0.01%
1. State-owned shares 0 0.00% 0 0 0 0 0 0 0.00%
(2) State-owned legal
0 0.00% 0 0 0 0 0 0 0.00%
person's shares
3. Other domestic shares 71,689 0.01% 0 0 0 5,750 5,750 77,439 0.01%
Including: Shares held by
0 0.00% 0 0 0 0 0 0 0.00%
overseas legal persons
Shares held by
71,689 0.01% 0 0 0 5,750 5,750 77,439 0.01%
domestic natural persons
4. Shares held by foreign
0 0.00% 0 0 0 0 0 0 0.00%
units
Including: Shares held by
0 0.00% 0 0 0 0 0 0 0.00%
overseas legal persons
Shares held by
0 0.00% 0 0 0 0 0 0 0.00%
foreign natural persons
II. Unrestricted shares 784,727,321 99.99% 0 0 0 -5,750 -5,750 784,721,571 99.99%
1. RMB ordinary shares 538,266,003 68.59% 0 0 0 -5,750 -5,750 538,260,253 68.59%
2. Domestically listed
246,461,318 31.40% 0 0 0 0 0 246,461,318 31.40%
foreign shares
3. Overseas listed foreign
0 0.00% 0 0 0 0 0 0 0.00%
shares
4. Others 0 0.00% 0 0 0 0 0 0 0.00%
III. Total shares 784,799,010 100.00% 0 0 0 0 0 784,799,010 100.00%
Reason for change
□ Applicable √ Not applicable
Approval of changes in share capital
□ Applicable √ Not applicable
Share transfer
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
□ Applicable √ Not applicable
Impact of changes in share capital on such financial indicators as basic EPS, diluted EPS, and net asset per share
attributable to common shareholders of the Company in the last year and previous report period
□ Applicable √ Not applicable
Other contents as deemed necessary by the Company or required by the securities regulatory authority to be
disclosed
□ Applicable √ Not applicable
2. Information on changes in restricted shares
√ Applicable □ Not applicable
Unit: Share
Restricted shares Restricted shares Restricted shares Date for
Name of Restricted shares Reason for
at period released in the increased in the releasing
shareholder at period end restricted trade
beginning current period current period restricted trade
Senior
Xu Ning 15,000 0 0 15,000 executive-targeted
share
Senior
Liu Zhijun 7,500 0 0 7,500 executive-targeted
share
Senior
Zheng Dan 31,939 0 0 31,939 executive-targeted
share
Senior
Zhu Longqing 9,000 0 3,000 12,000 executive-targeted
share
Senior
Ying Huadong 7,500 0 2,500 10,000 executive-targeted January 13, 2017
share
Senior
Tian Jiliang 750 0 250 1,000 executive-targeted January 13, 2017
share
Total 71,689 0 5,750 77,439 -- --
II. Issuance and listing of shares
1. Securities Issue (preferential shares excluded) in the report period
□ Applicable √ Not applicable
2. Explanations to changes of the sum of shares and the shareholder structure as well as the changes of the
asset and debt structure of the company.
□ Applicable √ Not applicable
3. Information of existing staff shares
Full Text of 2016 Annual Report of Shenzhen SEG Co., Ltd.
□ Applicable √ Not applicable
III. Information on Shareholders and Actual Controllers
1. Information on the number of shareholders and their shareholding status
Unit: Share
Total number
of preferred
shareholders
restored with
Total number of
Total number of the voting
Total number of ordinary
preferred rights at the
ordinary shareholders at the
shareholders end of the
shareholders at the 76,108 end of the month 73,299 0
restored with the month
end of the report immediately before
voting rights (if immediately
period the disclosure of the
any) (see note 8) before the
annual report
disclosure of
the annual
report (if any)
(see note 8)
Information on the shareholders holding more than 5% shares or top 10 shareholders
Share Quantity Information on pledged or
Shares held
increase/ of Quantity of frozen shares
Nature of Shareholding by the end
Name of shareholder decrease in restricted unrestricted
shareholder percentage of the report
the report shares shares held Share status Quantity
period
period held
Shenzhen SEG Group State-owned
30.24% 237,359,666 Unchanged 0 237,359,666 Unchanged
Co., Ltd. legal person
Domestic
Liu Guocheng 0.87% 6,804,502 -113,200 0 6,804,502
natural person
GF Securities Co., Ltd.
- Baoying Rui Feng
innovative and flexible
Others 0.56% 4,361,800 +4,361,800 0 4,361,800
configuration hybrid
securities investment
fund
Domestic
Zhang Jiao 0.52% 4,046,989 +2,998,601 0 4,046,989
natural person
Domestic
Liu Guohong 0.42% 3,300,558 -54,000 0 3,300,558
natural person
Overseas
Gong Qianhua 0.37% 2,940,000 Unchanged 0 2,940,000
natural person
Domestic
Zeng Ying 0.29% 2,300,000 -1,000,000 0 2,300,000
natural person
China Securities Domestic 0.29% 2,271,900 Unchanged 0 2,271,900
