The 2015 Annual Report of Lu Thai Textile Co., Ltd.
LU THAI TEXTILE CO., LTD.
THE 2015 ANNUAL REPORT
March 2016
The 2015 Annual Report of Lu Thai Textile Co., Ltd.
Section I Important Statements, Contents & Terms
The Board of Directors, the Supervisory Committee as well as the directors, supervisors and senior
management staff of Lu Thai Textile Co., Ltd. (hereinafter referred to as the “Company”) warrant
that this Report is factual, accurate and complete without any false information, misleading
statements or material omissions. And they shall be jointly and severally liable for that.
Liu Zibin, company principal, Zhang Hongmei, chief of the accounting work, and Zhang Keming,
chief of the accounting organ (chief of accounting), hereby confirm that the Financial Report
enclosed in this Report is factual, accurate and complete.
Except for the following directors, all the other directors attended in person the board meeting for
the review of this Report.
Reason for not attending in
Name Office title Proxy
person
Wang Lei Independent Director For reason of work Zhou Zhiji
Xu Jianjun Independent Director For reason of work Zhao Yao
The Company has described in detail in this Report the possible risks. Please refer to the contents
about the major risks and countermeasures in “Outlook of the Company’s future development” in
“Section IV Discussion & Analysis by the Management” of this Report. Securities Times, Shanghai
Securities News, China Securities Journal, Ta Kung Pao (HK) and www.cninfo.com.cn have been
designated by the Company for its information disclosure in 2016. And all information about the
Company shall be subject to what’s disclosed on the aforesaid media. Investors are kindly reminded
to pay attention to investment risks.
The Company’s preliminary plan for profit distribution upon review and approval at the board
meeting: Based on the total shares of 954,407,896, a cash dividend of RMB5 (tax included) will be
distributed to all the shareholders for every 10 shares that they hold. No bonus shares will be
granted and no capital reserves will be turned into share capital.
This Report is prepared in both Chinese and English. Should there be any understanding
discrepancy between the two versions, the Chinese version shall prevail.
The 2015 Annual Report of Lu Thai Textile Co., Ltd.
Contents
Section I Important Statements, Contents & Terms ....................................................................... 2
Section II Company Profile & Financial Highlights ....................................................................... 5
Section III Business Profile ............................................................................................................... 9
Section IV Discussion & Analysis by the Management ................................................................ 12
Section V Significant Events ........................................................................................................... 30
Section VI Changes in Shares & Shareholders ............................................................................. 41
Section VII Preference Shares......................................................................................................... 48
Section VIII Directors, Supervisors, Senior Management Staff & Employees .......................... 49
Section IX Corporate Governance ................................................................................................. 63
Section X Financial Report ............................................................................................................. 72
Section XI Documents Available for Reference ........................................................................... 222
The 2015 Annual Report of Lu Thai Textile Co., Ltd.
Terms
Term Specific meaning
Issuer, Company, the Company Lu Thai Textile Co., Ltd.
The Board of Directors The Board of Directors of Lu Thai Textile Co., Ltd.
The Supervisory Committee The Supervisory Committee of Lu Thai Textile Co., Ltd.
CSRC China Securities Regulation Commission
Yuan, Ten thousand RMB Yuan, RMB Ten thousand
The “Company Law” The “Company Law of the People‘s Republic of China”
The “Securities Law” The “Securities Law of the People‘s Republic of China”
Reporting period 1 Jan. 2015-31 Dec. 2015
The 2015 Annual Report of Lu Thai Textile Co., Ltd.
Section II Company Profile & Financial Highlights
I. Basic information of the Company
Stock abbr. Lu Thai A, Lu Thai B Stock code 000726, 200726
Stock abbr. after change (if any) No changes
Stock exchange Shenzhen Stock Exchange
Company name in Chinese 鲁泰纺织股份有限公司
Abbr. of Company name in Chinese 鲁泰纺织
Company name in English (if any) LU THAI TEXTILE CO., LTD
Abbr. of Company name in English (if any) LTTC
Legal representative Liu Zibin
No. 11, Mingbo Road, High-tech Industry Development Zone, Zibo, Shandong,
Registered address
P.R.China
Zip code
No. 81, Songling East Road, Zichuan District, Zibo, Shandong, P.R.China; No. 11,
Office address
Mingbo Road, High-tech Industry Development Zone, Zibo, Shandong, P.R.China
Zip code 255100; 255086
Company website www.lttc.com.cn
Email address lttc@lttc.com.cn
II. Contact information
Company Secretary Securities Affairs Representative
Name Qin Guiling Zheng Weiyin
No. 81, Songling East Road, Zichuan District, Zibo, No. 81, Songling East Road, Zichuan District, Zibo,
Contact address
Shandong, P.R.China Shandong, P.R.China
Tel. 0533-5266188 0533-5285166
Fax 0533-5418805；5282188-234 0533-5418805
E-mail address qinguiling@lttc.com.cn wyzheng@lttc.com.cn
III. About information disclosure and where this Report is placed
Newspapers designated by the Company for Securities Times, Shanghai Securities News, China Securities Journal and
information disclosure Ta Kung Pao (HK)
Internet website designated by CSRC for disclosing www.cninfo.com.cn
The 2015 Annual Report of Lu Thai Textile Co., Ltd.
this Report
Where this Report is placed The Securities Department of the Company
IV. Changes in the registered information
Organizational code 91370300613281175K
Changes in main business since listing (if any) No changes
Changes of controlling shareholder (if any) No changes
V. Other information
The CPAs firm hired by the Company
Name Ruihua Certified Public Accountants LLP
5-11F, West Tower, China Overseas Property Plaza, Block No. 7, Compound No. 8, Xibinhe
Office address
Road, Yongdingmen, Dongcheng District, Beijing, P.R.C.
Signing accountants He Feng, Cui Xiaoli
Sponsor engaged by the Company to conduct consistent supervision during the reporting period
□ Applicable √ Inapplicable
Financial consultant engaged by the Company to conduct consistent supervision during the reporting period
□ Applicable √ Inapplicable
VI. Accounting and financial highlights
Does the Company adjust retrospectively or restate the accounting data of previous years due to changes in the accounting policy or
correction of accounting errors?
□ Yes √ No
Increase/decrease of current
2015 2014
year over last year
Operating revenues (RMB Yuan) 6,173,322,778.61 6,169,688,792.53 0.06% 6,478,245,029.16
Net profits attributable to shareholders of
712,193,243.19 958,725,402.84 -25.71% 999,256,730.65
the Company (RMB Yuan)
Net profits attributable to shareholders of
the Company after extraordinary gains and 718,263,125.89 876,095,180.42 -18.02% 929,001,764.94
losses (RMB Yuan)
Net cash flows from operating activities
1,027,595,404.34 1,112,095,349.02 -7.6% 1,453,925,021.59
(RMB Yuan)
Basic EPS (RMB Yuan/share) 0.750 1.000 -25.00% 1.04
Diluted EPS (RMB Yuan/share) 0.750 1.000 -25.00% 1.04
Weighted average ROE (%) 10.66% 15.39% -4.73% 17.90%
As at 31 Dec. As at 31 Dec. Increase/decrease of current As at 31 Dec.
The 2015 Annual Report of Lu Thai Textile Co., Ltd.
2015 2014 year-end than last year-end 2013
Total assets (RMB Yuan) 9,091,170,499.22 8,627,671,393.88 5.37% 8,411,948,561.49
Net assets attributable to shareholders of the
6,837,113,075.58 6,588,772,245.55 3.77% 5,988,054,133.73
Company (RMB Yuan)
VII. Differences of the accounting data under the domestic and the overseas accounting
standards
1. Differences of the net profits and the net assets disclosed in the financial reports prepared under the
international and the Chinese accounting standards
√ Applicable □ Inapplicable
Unit: RMB Yuan
Net profits attributable to shareholders of the Net assets attributable to shareholders of the
Company Company
2015 2014 Closing amount Opening amount
According to Chinese accounting
712,193,243.19 958,725,402.84 6,837,113,075.58 6,588,772,245.55
standards
Items and amounts adjusted according to international accounting standards
Impact on domestic equipment tax
credit recognized as deferred
1,015,000.00 1,225,000.00 -1,054,000.00 -2,069,000.00
income under international
accounting standards
According to international
713,208,243.19 959,950,402.84 6,836,059,075.58 6,586,703,245.55
accounting standards
2. Differences of the net profits and the net assets disclosed in the financial reports prepared under the
overseas and the Chinese accounting standards
□ Applicable √ Inapplicable
No such differences for the reporting period
3. Reason for any differences in the accounting data under the domestic and the overseas accounting
standards
√ Applicable □ Inapplicable
Effects of domestic equipment exempted from income tax
The Company exempted from income tax for buying domestic equipment. According to Chinese accounting standards, the income
tax expenses are directly reduced which are recognized as deferred income related to assets by the international accounting standards.
According to the regulations of the international accounting standards, this difference is amortized over the fixed using periods of
year of the fixed assets and adjusting net income and net assets.
The 2015 Annual Report of Lu Thai Textile Co., Ltd.
VIII. Financial highlights by quarter
Unit: RMB Yuan
Q1 Q2 Q3 Q4
Operating revenues 1,428,557,406.74 1,513,278,490.42 1,569,500,236.21 1,661,986,645.24
Net profits attributable to
152,714,080.35 191,807,436.37 204,342,167.24 163,329,559.23
shareholders of the Company
Net profits attributable to
shareholders of the Company after 131,929,166.88 176,675,290.53 188,913,906.19 220,744,762.29
extraordinary gains and losses
Net cash flows from operating
-97,329,127.52 457,602,609.70 473,236,649.61 194,085,272.55
activities
Any material differences between the financial indicators above or their summations and those which have been disclosed in
quarterly or semi-annual reports?
□ Yes √ No
IX. Extraordinary gains and losses
√ Applicable □ Inapplicable
Unit: RMB Yuan
Item 2015 2014 2013 Note
Gains/losses on disposal of non-current assets (including offset part of
-4,666,157.56 -3,316,012.55 432,380.47
asset impairment provisions)
Government grants recognized in current period, except for those
acquired in ordinary course of business or granted at certain quotas or 43,266,788.43 99,126,878.52 51,990,074.84
amounts according to government’s unified standards
Gains and losses on change in fair value from tradable financial assets
and tradable financial liabilities, as well as investment income from
disposal of tradable financial assets and tradable financial liabilities and -29,145,915.85 -5,319,435.30 33,746,810.30
financial assets available for sales except for effective hedging related
with normal businesses of the Company
Non-operating income and expense other than above 3,432,535.47 21,173,199.30 1,991,154.72
Less: Income tax effects 12,302,309.25 22,913,850.04 12,701,157.60
Minority interests effects (after tax) 6,654,823.94 6,120,557.51 5,204,297.02
Total -6,069,882.70 82,630,222.42 70,254,965.71 --
Explain the reasons if the Company classifies an item as an extraordinary gain/loss according to the definition in the Explanatory
Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Extraordinary Gains and
Losses, or classifies any extraordinary gain/loss item mentioned in the said explanatory announcement as a recurrent gain/loss item
□ Applicable √ Inapplicable
No such cases in the reporting period.
The 2015 Annual Report of Lu Thai Textile Co., Ltd.
Section III Business Profile
I. Main business during the reporting period
(I) Lu Thai, unremittingly taking “creating wealth, contributing to the society, clothing the country and boosting the development of
the world” as its mission, has been practicing the value of “people foremost policy, rigorous scientific attitude, client oriented
principle and integrity for win-win outcome” for a long time. It is devoted to improving and expanding its industrial chain, making it
a renowned textile and garment business group combing cotton breeding, spinning, bleaching and dyeing, neatening, testing, garment
making and marketing. Lu Thai produces and sells middle and high-grade yarn-dyed fabric and dyeing fabric for shirts and garment.
It claimed its fame for its comprehensive management, R&D ability, advanced technology, international development plan and stable
quality. Moreover, it also attaches great importance to improve the added value of its products, explore the emerging market and
renew its service philosophy. With natural fabric as its flagship, multi-component functional fiber fabric as its spearhead and
wash-and-wear non-ironing technology as its core competency, the company kept a watchful eye on the latest consumption trend.
Great attention was paid to improve its healthy product series so as to satisfy the needs from the diversified and personalized market.
(II) At the current stage, the textile industry of China is encircled by transnational development and is gaining its strength to be
become mature. Lu Thai had already become the largest world renowned manufacturer for high-grade yarn dyed fabric and
premium-brand shirts. It had paved its development pattern featured in going green, low-carbon growth, science and technology and
humanism. Its operation performance was always among the top comparing to its peers. 80% of Lu Thai’s products were exported
over 30 countries and regions in the world, including America, EU and Japan. The export percentage for high-grade yarn dyed
fabric--a self-owned brand attained 70% of its export volume, accounting for 18% of the world’s export market share.
II. Significant changes in the main assets
1. Significant changes in the main assets
Main asset Reason for any significant change
RMB205,094,029.50 as at 31 Dec. 2015, up 65.95% from opening amount, mainly
Construction in progress because of new inputs to Lu Thai (Burma) Garment project and Lu T
