Summary of 2019Annual Report of Shenzhen Textile (Holdings) Co., Ltd.Stock code: 000045,200045 Stock Abbreviation: Shen Textile A, Shen Textile B Announcement No. :2020-10
Summary of 2019 Annual Report of Shenzhen Textile
(Holdings) Co., Ltd.I. Important notesThe summary is abstract from full-text of annual report, for more details information , investors should found inthe full-text of annual report that published on website of Shenzhen Stock Exchange and other website appointedby CSRC.All the directors attended the board meeting for the review of this Report.Non-standard auditor’s opinion
□ Applicable √Not applicable
Preliminary plan for profit distribution to the common shareholders or turning the capital reserve into the sharecapital for the reporting period, which has been reviewed and approved at the board meeting
□ Applicable √Not applicable
The Company has no plan of cash dividends carried out, bonus issued and capitalizing of common reserves either.Preliminary plan for profit distribution to the preference shareholders for the reporting period which has beenreviewed and approved at the board meeting
□ Applicable √Not applicable
II. Basic information about the company
1. Company profile
| Stock abbreviation | Shen Textile A，Shen Textile B | Stock code | 000045，200045 | |
| Stock exchange for listing | Shenzhen Stock Exchange | |||
| Contact person and contact manner | Board secretary | Securities affairs Representative | ||
| Name | Jiang Peng | Li Zhenyu | ||
| Office Address | 6/F, Shenfang Building, No.3 Huaqiang North Road, Futian District, Shenzhen | 6/F, Shenfang Building, No.3 Huaqiang North Road, Futian District, Shenzhen | ||
| Fax | 0755-83776139 | 0755-83776139 | ||
| Tel | 0755-83776043 | 0755-83776043 | ||
| jiangp@chinasthc.com | lizy@chinasthc.com | |||
2. Brief introduction to the main business or products in the reporting period
1. Main Business the Company
The company's main business covered such the high and new technology industry as represented by LCDpolarizer, its own property management business and the retained business of high-end textile and garment.In the report period, no significant change happened to the main business of the Company. Firstly, driven byinnovation, the company has continuously improved the production capacity and product quality of polarizerthrough a series of measures such as reforming the production line equipment, increasing the speed of the
Summary of 2019Annual Report of Shenzhen Textile (Holdings) Co., Ltd.production line, optimizing the process by taking advantage of the production line, and prolonging theservice life of liquid medicine. Secondly, it took multiple measures to reduce costs and speed up theintroduction of new customers. It has effectively reduced the comprehensive loss rate, completed theintroduction and replacement of various protective films and chemical materials, and controlled theproduction cost by optimizing the process of liquid replenishment concentration; Under the severe marketenvironment and the situation that customer production reduction and inventory control, it has activelydeveloped high margin orders and new panel customers such as LGD, SDP and HKC, which effectivelyimproved the sales profit of products and the stability of customer structure. Thirdly, the Company hasactively promoted the construction of Line 7 project: it has further strengthened the monitoring andmanagement of budget, progress, quality and other aspects, and actively promoted the technical exchangewith Nitto Denko and Kunshan Zhiqimei. The civil engineering construction of Line 7 started on April 18,2019, and the main factory building has been capped on December 30, 2019 as planned. Fourthly, theproperty companies have strengthened its management services and improved their efficiency. Although thedownturn in the real economy has caused some pressure to property leasing, all property companies haveincreased their management efforts to improve service quality, and the rental situation is stable with a rentalrate up to 100%. Fifthly, due to the impact of Sino-US trade friction, orders have decreased sharply. Thetextile industry has stepped up its innovation efforts, actively explored new customers, exploited its potentialin depth, and achieved sustained profits for two years. Sixthly, it has strengthened safety and environmentalprotection, maintained the harmony and stability of enterprises, always put safety and environmentalprotection production in a prominent position, implemented the responsibility system of work safety, pursuedsafe and green production, and actively fulfilled social responsibilities.As a type of upstream raw materials of LCD panels and one of essential and fundamental materials in thepanel display industry, polarizers are widespread used in a variety of areas, LCD panels and OLED panels forsmart phones, tablet PCs and TV sets, instruments, apparatuses, sunglasses, and light filters of cameraequipment, to name a few. At the moment, the Company has 6 mass polarizer production lines for makingproducts that cover such areas as TN, STN, TFT, OLED, 3D, dye films, and optical films for touch screensand are primarily used in TV, NB, navigators, Monitor, vehicle-mounted, industrial control, instruments,apparatuses, smart phones, wearable equipment, 3D glasses, sunglasses and other products, based on which,the Company has become a qualified supplier to China Star Optoelectronics Technology (CSOT), BOE,Infovision Optoelectronics (IVO), Shenchao Optoelectronic, LGD, Tianma and other major panel enterprisesthrough constant extension of its marketing channels and building of its own brand.
2. The Company's main products made in each polarizer production line and their application are as follows:
| Line | Place | Product breadth | Planned capacity | Main products |
| Line 1 | Pingshan | 500mm | 600,000 m2 | TN/STN/ dye film |
| Line 2 | Pingshan | 500mm | 1.2 million m2 | TN/STN/CSTN |
| Line 3 | Pingshan | 650mm | 1 million m2 | TN/STN/CSTN/TFT |
| Line 4 | Pingshan | 1490mm | 6 million m2 | TN/STN/CSTN/TFT |
| Line 5 | Pingshan | 650mm | 2 million m2 | TFT |
| Line 6 | Pingshan | 1490mm | 10 million m2 | TFT/OLED |
| Line 7 (Under construction) | Pingshan | 2500mm | 32 million m2 | TFT/OLED |
(II) Company's business modelThe priority of the polarizer industry is gradually shifting from the conventional research &development-production-sales business model to the customer-oriented business model of joint research &development and full service. The Company reduced production links and costs and created value for customersand a win-win situation through cooperation by understanding customers' needs, making high-quality productsthrough joint research & development and high-standard production management and using advanced polarizerrolling and attaching equipment in conjunction with downstream panel manufacturers' production lines.
(III) Major factors for driving the Company's performanceRefer to "III. Analysis on core competitiveness" in this section for details.(IV) Development stage and periodic characteristics of the industry where the Company is involved and theCompany's position in the industry
Refer to "IX. Company's outlook for future development" in Section IV for details.In the future, the Company will deepen driving the mixed-ownership reform work and strengthen strategiccooperation based on more than 20 years of industrial operation experience and regional advantages. To bespecific, the Company will further optimize its equity structure, invigorate its operation and promote itsproduction technology and business management standards through integration of resources in the polarizer andoptical film industries; meanwhile, the Company will spare no effort to push forward the construction of anultra-wide polarizer production line to occupy the highly lucrative jumbo LCD TV polarizer product market; inaddition to working on the polarizer industry, the Company will make a leaping development towards the opticalfilm industry to make SAPO Photoelectric a bigger and stronger enterprise.
3.Major accounting data and financial indicators
（1）Major accounting data and financial indicators for the last three years
Indicate by tick mark whether there is any retrospectively restated datum in the table below.
□ Yes √No
In RMB
| 2019 | 2018 | Changed over last year（％） | 2017 | |
| Operating income（RMB） | 2,158,184,855.71 | 1,272,356,771.34 | 69.62% | 1,475,545,719.72 |
| Net profit attributable to the shareholders of the listed company（RMB） | 19,679,910.43 | -22,980,624.93 | 185.64% | 52,776,101.46 |
| Net profit after deducting of non-recurring gain/loss attributable to the shareholders of listed company（RMB） | -41,179,849.56 | -65,404,429.81 | 37.04% | 3,140,446.26 |
| Cash flow generated by business operation, net（RMB） | 383,145,788.50 | -460,494,321.15 | 183.20% | -28,518,702.31 |
| Basic earning per share(RMB/Share) | 0.04 | -0.04 | 200.00% | 0.10 |
| Diluted gains per share(RMB/Share)(RMB/Share) | 0.04 | -0.04 | 200.00% | 0.10 |
| Weighted average ROE(%) | 0.75% | -0.96% | 1.71% | 2.23% |
| End of 2019 | End of 2018 | Changed over last year（％） | End of 2017 | |
| Gross assets（RMB） | 4,531,399,885.99 | 4,619,203,416.79 | -1.90% | 4,195,746,507.56 |
| Net assets attributable to shareholders of the listed company（RMB） | 2,727,764,144.36 | 2,373,329,991.86 | 14.93% | 2,397,474,603.79 |
（2）Main Financial Index by Quarters
In RMB
| First quarter | Second quarter | Third quarter | Fourth quarter | |
| Operating income | 592,839,958.12 | 416,023,337.38 | 631,655,475.88 | 517,666,084.33 |
| Net profit attributable to the shareholders of the listed company | 10,381,938.06 | -2,549,650.08 | 9,061,067.98 | 2,786,554.47 |
| Net profit after deducting of non-recurring gain/loss attributable to the shareholders of listed company | 7,034,190.76 | -17,582,772.96 | -1,542,112.46 | -29,089,154.90 |
| Net Cash flow generated by business operation | 23,567,172.13 | 259,190.22 | 262,706,321.30 | 96,613,104.85 |
Summary of 2019Annual Report of Shenzhen Textile (Holdings) Co., Ltd.Whether significant variances exist between the above financial index or the index with its sum and the financialindex of the quarterly report as well as semi-annual report index disclosed by the Company.
□ Yes √No
4.Share capital and shareholders
（1）Number of holders of ordinary shares and preference shares with restored voting right and Top 10shareholders
In shares
| Total number of common shareholders at the end of the reporting period | 31,622 | Total shareholders at the end of the month from the date of disclosing the annual report | 32,552 | The total number of preferred shareholders voting rights restored at period-end(if any) | 0 | Total preferred shareholders at the end of the month from the date of disclosing the annual report(if any) | 0 | |||||
| Shareholdings of top 10 shareholders | ||||||||||||
| Shareholders | Nature of shareholder | Proportion of shares held(%) | Number of shares held at period -end | Amount of restricted shares held | Number of share pledged/frozen | |||||||
| State of share | Amount | |||||||||||
| Shenzhen Investment Holdings Co., Ltd. | State-owned legal person | 45.96% | 234,069,436 | |||||||||
| Shenzhen Shenchao Technology Investment Co., Ltd. | State-owned Legal person | 3.17% | 16,129,032 | |||||||||
| Lu Yunlong | Domestic Nature person | 0.67% | 3,400,450 | |||||||||
| Sun Huiming | Domestic Nature person | 0.63% | 3,224,767 | |||||||||
| Li Songqiang | Domestic Nature person | 0.56% | 2,873,078 | |||||||||
| Kuang Guowei | Domestic Nature person | 0.29% | 1,452,800 | |||||||||
| Zhang Ling | Domestic Nature person | 0.27% | 1,400,000 | |||||||||
| Zhu Ye | Domestic Nature person | 0.27% | 1,360,545 | |||||||||
| Hong Fan | Domestic Nature person | 0.26% | 1,338,900 | |||||||||
| Jiang Zilan | Domestic Nature person | 0.23% | 1,187,500 | |||||||||
| Related or acting-in-concert parties among shareholders above | Shenzhen Shenchao Technology Investment Co., Ltd. is a wholly-owned subsidiary of Shenzhen Investment Holdings Co., Ltd., According to the decision of the State-owned Assets Supervision and Administration Commission of Shenzhen Municipal People's Government, Shenzhen Shenchao Technology Investment Co., Ltd was transferred to Shenzhen Major Industrial Investment Group Co., Ltd in June 2019. Shenzhen Investment Holdings Co., Ltd and Shenzhen Shenchao Technology Investment Co., Ltd are both controlled by the State-owned Assets Supervision and Administration Commission of the Shenzhen Municipal People's Government, so they are persons acting in concert. Except this, the Company did not whether there is relationship between the top ten shareholders holding non-restricted negotiable shares and between the top ten shareholders holding non-restricted negotiable shares and the top 10 shareholders or whether they are persons taking concerted action defined in Regulations on Disclosure of Information about Shareholding of Shareholders of Listed Companies. |
| Explanation on shareholders participating in the margin trading business(if any ) | The Company Shareholder Li Songqiang holds 2,872,653 shares of the Company through stock account with credit transaction ; The Company Shareholder Zhu Ye holds 1,182,045 shares of the Company through stock account with credit transaction; The Company Shareholder Jiang Zilan holds 1,187,500 shares of the Company through stock account with credit transaction. |
(2)Number of the preference shareholders and the shareholdings of the top 10 of them
□ Applicable √Not applicable
No preference shareholders in the reporting period
(3)Relationship between the Company and its actual controller in the form of diagram
5. Corporation bonds
Corporate Bonds Indicate by tick market whether the Company has any corporate bonds publicly offered andlisted on the stock exchange, which were undue before the date of this Report’s approval or were due but couldnot be redeemed in full.NoIII. Discussion and Analysis of the Management
1. Business Operation summary in the reporting period
In 2019, facing the challenges and tests of repeated Sino-US trade frictions and increasingly severe polarizerbusiness situation, the Company took reducing losses and increasing profits of the main polarizer business as its
work focus, led all employees to overcome difficulties, and did solid work to improve business. While fullypushing forward the construction of ultra-wide polarizer project and improving the main polarizer business, theCompany revitalized its stock assets, stimulated business vitality, ensured the continuous growth of propertyleasing's revenue and maintained a steady and orderly development trend.
In 2019, the Company realized the operating income of 2.158 billion yuan, an increase of 69.62% over thesame period of the previous year; the total profit of 9.5324 million yuan, an increase of 117.84% over the sameperiod of the previous year; the net profit attributable to owners of the parent company of 19.6799 million yuan, aan increase of 185.84% over the same period of the previous year. Phase II Line 6 in the second half of 2018, therelease of production capacity in the current year, and the year-on-year increase in sales; Imports of equipmentthat had been prepaid in 2018 were completed during the reporting period, and commodity trade revenueincreased year on year. The net profit attributable to shareholders of listed companies increased significantly yearon year, mainly due to the increase in non-recurring profits and losses, with an impact amount of 78,913,700 yuan ,mainly including non-current asset disposal income, investment and wealth management income and governmentsubsidy income, among which, the Company transferred 50% of the equity of Haohao Property to realize anafter-tax net profit of 41,611,400 yuan; The selling price of polarizer products has been low since the sharp drop in2018. The order structure adjustment of major products has not met expectations, plus the selling price of TN/STNproducts fallen sharply due to the shrinking sales in the end product market, and the increase in purchasing costand exchange loss caused by the devaluation of RMB exchange rate have offset the contribution of the salesincrease to net profit.Review of the company's key works carried out in 2019 as follows:
(I) Polarizer's operating capability has been improved
In 2019, firstly the Company, oriented by the market, optimized the product structure, and further releasedthe production capacity, with a great increase in polarizer sales area; Secondly, it has actively explored the market,strengthened communication with key customers and sped up the certification of new products. In 2019, it hasexplored new panel customers such as LGD, SDP and HKC. While effectively improving the sales profit of Line4/6 products, it has further expanded the customer base and maintained the stability of the customer structure;Thirdly, it has taken innovation as the motive force to improve the product quality and reduce the production costby continuously optimizing the production process; Fourthly, it has actively striven for support funds for scientificresearch policies, with a total of 68.27 million yuan.
Meanwhile, the Company continued to explore R&D innovation and intensify the development ofindependent intellectual property rights. Its research and development were combined with the actual marketconditions to carry out product development and market promotion and import, so as to improve productperformance. In 2019, 8 coating materials and 4 protective films were successfully introduced through newproduct development; A total of 8 patents have been applied, including 7 invention patents and 1 utility modelpatent; A total of 9 patents have been authorized, including 3 patents for inventions and 6 patents for utilitymodels.
(II) Turned losses into profits for textile business, while property enterprises rose steadily.
In 2019, under the circumstance that the Sino-US trade friction led to a sharp drop in domestic demand andexport orders for textile and clothing, the Company, on the one hand, stabilized its existing customers and activelyexploited the market; On the other hand, optimized internal management, intensified R&D and innovation efforts,developed high-margin products, enhanced income-generating capacity, and realized the profitability of textilebusiness for two consecutive years.
In 2019, the Company further strengthened various management and service concepts of property enterprises,scientifically coped with the adverse effects of the economic downturn and the downturn in the market on therental and management of various properties, and made every effort to well ensure rental management. It strove toincrease rental income through vigorously improving service quality, implementing standardized management,strengthening rectification of potential safety hazards, refining management processes, saving expenses andincreasing efficiency. The leasing situation of all property enterprises is stable, with a rental rate up to 100%.
(III) Facilitated construction of jumbo TV polarizer industrialization project with effort
In 2019, the Company actively promoted the construction of the polarizer industrialization project forultra-large TV (Line 7). Firstly, the main factory building of the Line 7 project was capped, and the factoryacceptance, customs declaration and import of equipment, transportation to the factory and other related workwere carried out simultaneously; Secondly, the Company further strengthened the monitoring and management ofbudget, schedule, quality and other aspects in the process of project construction; Thirdly, it actively promoted theresearch and development of some raw materials, basically determined the supply of main raw materials
Summary of 2019Annual Report of Shenzhen Textile (Holdings) Co., Ltd.corresponding to the 2,500mm width production line, and solved the supply problem of raw materials matchingthe 2,500mm ultra-wide polarizer production in 2020.(IV) Revitalized the existing assets, optimized the allocation of resources, and concentrated resources ondeveloping the main business of polarizerIn order to further revitalize the Company's existing assets, concentrate resources on its main business andfully support the development of main business of polarizer, the Company has listed and transferred its 50%equity in Haohao Property through Shenzhen United Property and Share Rights after deliberation and approval bythe 22nd meeting of the 7th Board of Directors and the 2nd Extraordinary General Meeting in 2019. The 50%equity of Haohao Property has been publicly listed on Shenzhen United Property and Share Rights fromNovember 14, 2019 to December 18, 2019 and as of the expiration of the listing announcement, an intendedtransferee, Urban Construction Group emerged. Both parties have signed the Property Rights Transaction Contracton December 19, 2019. This transaction realized an investment income of 55,481,800 yuan , which had a positiveimpact on the company's annual performance in 2019.(V) Strengthened safety awareness and earnestly well ensured safety and environmental protectionFirstly, it has attached great importance to the work safety, implemented the main responsibility system forwork safety, and implemented the responsibility for work safety to each individual, so that the responsibility isspecific and the division of labor is clear. Secondly, by centralized rectification and focused investigation, it haseliminated potential safety hazards, and carried out on-site surprise inspections for 7 times in all affiliatedenterprises. 196 potential safety hazards and problems were found in the inspections, and rectification has beencompleted. Thirdly, it has actively promoted the construction of safety standardization and dual preventionmechanisms, and implemented cross-checking and rectification. Fourthly, it has focused on supervising theconstruction of Line 7 project and prevented safety accidents; It has standardized the safety management ofhazardous chemicals in enterprises, actively carried out fire emergency drills, and established and improved safetymanagement files for special equipment. In 2019, it has continued to well ensure environment-friendly treatmentin waste water and waste gas, discharged them according to standards and achieved zero complaints.（VI) Constant reinforcement of foundation and strengthening of primary Party building workThe Company has fully implemented Xi Jinping's new era characteristic socialism thought and the spirit ofthe 19th National Congress of the Communist Party of China, insisted on strengthening Party self-discipline anddeveloping democracy, continuously strengthened the party organization's political guidance to the enterprise,strengthened the ideological & political and organizational construction, continuously tamped the partyconstruction foundation, and earnestly performed the main responsibility; The superior and bottom levels workedtogether to carry out in-depth education activities on the theme of "Stay true to the mission" and continuouslystrengthened the "four consciousnesses", firmly established the "four self-confidence" and achieved the "twomaintenance".
2. Material change in principal activities during the reporting period
□ Yes √ No
3. Products accounting for over 10% of revenue or profit from principal activities of the Company
√ Applicable □ Not applicable
In RMB
| Name | Operating income | Operating profit | Gross profit rate(%) | Increase/decrease of operating income in the same period of the previous year(%) | Increase/decrease of operating profit over the same period of previous year (%) | Increase/decrease of gross profit rate over the same period of the previous year (%) |
| Lease and Management of Property | 106,372,055.25 | 92,485,181.26 | 77.32% | 8.18% | 119.23% | 3.60% |
| Textile | 46,047,351.10 | 801,439.83 | 14.94% | -2.42% | 16.56% | 2.02% |
| Polarizer sheet | 1,429,757,296.56 | -121,855,790.81 | 4.25% | 71.80% | -7.57% | 0.18% |
| Trade | 517,020,991.54 | 32,146,314.83 | 6.46% | 79.06% | 106.83% | 0.49% |
4. Seasonal or cyclical operations requiring special attention
□ Yes √ No
5. Significant YoY changes in the operating revenues, operating costs and net profits attributable to thecommon shareholders or their composition
√ Applicable □Not applicable
During the reporting period, the Company's operating income increased by 885.8281 million yuan year onyear, with a year-on-year increase of 69.62%. It was mainly caused by the following factors: Firstly, Line 6 wasput into production in the second half of 2018 and its production capacity was released this year, which greatlyincreased the sales revenue of Line 6 products; Secondly, the trade revenue of the year increased significantly yearon year; Thirdly, the sales volume of Line 5 products increased due to the influence of market conditions, and thesales revenue increased year on year.During the reporting period, the net profit attributable to ordinary shareholders of listed companies increasedby 4,266.05 yuan , with a year-on-year increase of 185.64%. It was mainly caused by the following factors: Firstly,the net sales interest rate of trade business was relatively high, and the net profit of trade business increased yearon year due to the year-on-year increase in trade income; Secondly, the disposal of long-term equity investmentincreased the investment income year on year.
6. Suspension in trading or delisting
□ Applicable √ Not applicable
7. Events relating to the financial report
(1) Particulars about the changes in aspect of accounting policy, estimates and calculation method compared withthe financial report of last year
√ Applicable □Not applicable
I. Changes in accounting policies
(I) Accounting policy changes caused by implementation of new financial instrument standards
In 2017, the Ministry of Finance revised and promulgated the Accounting Standards for Business EnterprisesNo.22-Recognition and Measurement of Financial Instruments, Accounting Standards for Business EnterprisesNo.23-Transfer of Financial Assets, Accounting Standards for Business Enterprises No.24-Hedge Accounting andAccounting Standards for Business Enterprises No.37-Presentation of Financial Instruments (the above fourstandards are collectively referred to as "New Financial Instrument Standards"), which are required to come intoforce on January 1, 2019 for domestic listed enterprises. According to the regulations, the Company willimplement the new financial instrument standards from January 1, 2019 and adjust the relevant contents ofaccounting policies. The Company began to implement the new financial instrument standards at the time requiredby the Ministry of Finance after adopting a proposal at the 18th meeting of the 7th board of directors of theCompany on April 25, 2019.
The Company retrospectively applies the new financial instrument standards, but for classification andmeasurement (including impairment) involving the inconsistency between the previous comparative financialstatement data and the new financial instrument standards, the Company chooses not to repeat. Therefore, for thecumulative impact of the first implementation of this standard, the Company adjusted the retained earnings orother comprehensive earnings at the beginning of 2019 and the amount of other related items in the financialstatements, which were not restated in the financial statements of 2018.
The main changes and impacts of the implementation of the new financial instrument guidelines on ourCompany are as follows:
- The structural deposits held by the Company were originally classified as other current assets, reclassifiedby the Company as financial assets measured at fair value and recorded in current profits and losses on or afterJanuary 1, 2019, and reported as transactional financial assets;
Summary of 2019Annual Report of Shenzhen Textile (Holdings) Co., Ltd.- On January 1, 2019 and beyond, the Company designated non-tradable equity investments held as financialassets measured at fair value and included their changes in other comprehensive income, and reported them asinvestments in other equity instruments;-In its daily fund management, the Company endorsed or discounted some bank acceptance bills, aiming atboth receiving the contract cash flow and selling financial assets. Therefore, the Company reclassified these billsreceivable into financial asset categories measured at fair value with changes included in other comprehensiveincome and reported them as receivables financing on or after January 1, 2019.
(II) Other accounting policy changes
1. The Company prepared 2019 annual financial statements in accordance with the requirements of theMinistry of Finance's Notice on Revising and Issuing the Format of General Enterprise Financial Statements for2019 (CK [2019] No.6), Notice on Revising and Issuing the Format of Consolidated Financial Statements (2019Edition) (CK [2019] No.16) and the Accounting Standards for Enterprises. Retroactive adjustment method isadopted for such accounting policy changes.
2. The Company will implement the revised Accounting Standards for Business Enterprises No.7-Exchangeof Non-monetary Assets from June 10, 2019 and the revised Accounting Standards for Business EnterprisesNo - ebt est ct i o e e acco ti polic c a e s all be a le b t e t eapplicable et o
II. Changes in accounting estimates
No significant changes in accounting estimates have occurred in the current period.
(2) Major accounting errors within reporting period that needs retrospective restatement
□ Applicable √ Not applicable
No major accounting errors within reporting period that needs retrospective restatement for the Company in theperiod
(3) Compare with last ea ’s i a cial epo t; explai c a es i co soli atio state e t’s scope
□ Applicable √ Not applicable
No changes in consolidation statement scope in the reporting period
The Board of Directors of Shenzhen Textile (Holdings) Co., Ltd.March 14, 2020