RoboSense Technology Co., Ltd — Interim / Quarterly Report 2002

Oct 29, 2002

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this announcement, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

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(a joint stock limited company incorporated in the People’s Republic of China with limited liability)

THIRD QUARTERLY REPORT 2002

Important Note

It is hereby confirmed by the Board of Directors of the Company that there is no false representation, material misleading information or substantial omission, contained in this report. The Board of Directors of the Company also jointly and severally accepts full responsibility for the truthfulness, accuracy and completeness of the contents of the report. This quarterly report is prepared in accordance with the regulations on Disclosure of Information in Quarterly Reports for Listed Companies by the China Securities Regulatory Commission. The information in this Report is the same as that published by the Shanghai Stock Exchange, and this Report is published simultaneously in Shanghai and Hong Kong. All financial information set out in this quarterly report has been prepared in accordance with PRC accounting standards. Shareholders of the Company and public investors should be aware of the risks of investment when trading in shares.

Zhu Leibo and Jiang Hong, Directors, were absent from the meeting due to being on business trips overseas. Dai Zhiliang and Wei Chenglong, Directors, were absent from the meeting due to personal reasons.

This announcement is made pursuant to the disclosure obligation under Paragraph 2 of the Listing Agreement. The financial statements contained of the Company in this quarterly report have not been audited.

• I. COMPANY BASIC INFORMATION

1.	A Shares Place of listing	: Shanghai Securities Exchange
	Stock code	: 600876
	Stock abbreviation	: Luoyang Glass
	H Shares - Place of listing	: The Stock Exchange of Hong Kong Limited
	Stock code	: 1108
	Stock abbreviation	: Luoyang Glass
2.	Secretary of the Board of Directors	: Mr. Wang Jie
	Correspondence address	: Secretary Office of Board of Directors,
		Luoyang Glass Company Limited,
		No. 9, Tang Gong Zhong Lu, Xigong District,
		Luoyang Municipal, Henan Province,
		People’s Republic of China (“PRC”)
	Contact person	: Mr. Wang Fan, Mr. Guo Bing
	Telephone number	: 86-379-3908588
	Fax number	: 86-379-3251984
	E-mail address	: lbdms@public2.lyptt.ha.cn

1. Major Financial Data and Indicators Prepared in accordance with the PRC Accounting Rules and Regulations:

Unit: RMB’000

	Unit: RMB’000
Items	Jan-Sept 2002
Net profit/(loss)	(134,605 )
Net profit/(loss) after extraordinary items (note)	(91,687 )
Return/(loss) on net assets (%)	(9,426 )
Earnings/(loss) per share (RMB)	(0.192 )
	Unit: RMB’000

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	30 September	31 December
Items	2002	2001
Shareholders’ funds (excluding
minority interests)	1,428,010	1,562,584
Net assets per share (RMB)	2.04	2.23
Adjusted net assets per share (RMB)	1.04	1.23

Note: The extraordinary items deducted during the reporting period are net non-operating amount of RMB42,918,000.

II. CHANGE IN SHARE CAPITAL AND SHAREHOLDINGS OF SUBSTANTIAL SHAREHOLDERS

(1) During the reporting period, there was no change in the total number of shares and share capital structure of the Company.

(2) By the end of the reporting period, there were 32,094 shareholders in the Company.

• (3) By the end of the reporting period, the top ten shareholders of the Company were as follows:

			Percentage to
Name of		No. of shares	total share
shareholders	Class	held (shares)	capital(%)
China Luoyang Float Glass (Group)
Company of Limited Liability
(holding shares on behalf
of the State) (“CLFG”)	A Shares	400,000,000	57.14
HKSCC Nominees Limited	H Shares	247,116,998	35.30
Zhu Dake	A Shares	730,000	0.10
Xiang Cai Securities	A Shares	662,344	0.09
HSBC Nominees (Hong Kong) Limited	H Shares	520,000	0.07
Yan Jianding		434,000	0.06
Chuk Yee Men Liza	H Shares	374,000	0.05
Xinghe Jijin	A Shares	225,221	0.03
Tam Chow Hing	H Shares	210,000	0.03
Shou Jianhong	A Shares	194,300	0.03
Zhang Bingliang	A Shares	170,105	0.02

Notes:

(1) During the reporting period, there was no change in controlling shareholders of the Company. CLFG is the company, which holds shares for the State. 400,000,000 shares are State-owned unlisted shares, representing 57.14% of the total issued share capital of the Company. None of the shares held by it was pledged, frozen or under custody in the reporting period.

(2) The 247,116,998 H shares of the Company held by HKSCC Nominees Limited at the end of the period accounted for 35.30% of the total share capital of the Company. HKSCC Nominees Limited is a participant of Hong Kong Central Clearing and Settlement System providing securities registration and custody services for its customers. The Company is not aware of any individual customers holding more than 10% interest in the total issued shares of the Company.

(3) H or A Shares held by the top second to tenth shareholders are offered to the public as listed shares. It is not certain whether the shares held by them were pledged, frozen or under custody in the reporting period.

(4) The Company is not aware of whether the top ten shareholders are related to each other.

III. EXPLANATION AND ANALYSIS OF BUSINESS OPERATIONS

(1) Operation results

In the first half of the year, due to a new wave of reconstruction of the glass industry was formed in the PRC, supply of float flat glass exceeded demand; price of float flat glass decreased significantly; inventories built up; there was a shortage of operating funds. In the third quarter, high season of the Company, price of float flat glass bounced slightly; inventories diminished significantly; the shortage of current funds was eased. The business in this quarter improved compared to that in the first half of the year. However, prices of products were low, leading loss recorded in the third quarter.

(2) Investment of the Company

1. Use of proceeds

There had been no use of proceeds during the reporting period or use of proceeds commenced before the reporting year, which has been extended to the reporting year.

2. Other investment (other than proceeds)

• (1) The Company entered into an agreement with CLFG, the controlling shareholder of the Company on 27 March 2002, for the purpose of setting up China Luoyang Float Glass (Group) Processed Glass Company Limited (“Processed Glass Company”) in order to mainly engage in the production of processed glass products. The registered capital of the Processed Glass Company is RMB181,495,600, of which RMB89,095,600 (constituting approximately 49.09% thereof) will be contributed by the Company and RMB92,400,000 (constituting approximately 50.91% thereof) will be contributed by CLFG. On 11 September 2002, Processed Glass Company was incorporated .

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(3) Operational results and financial position

1. Operational results Table 1:

Unit: RMB’000

Table 1:			Unit: RMB’00
	Jan-Sept	Jan-Sept	Increase
Items	2002	2001	(Decrease) %
Income from principal operations	587,301	611,608	-3.97%
Profit from principal operations	15,417	85,236	-81.91%
Net profit/(loss)	(134,605 )	8,735	-1640.98%

Analysis of reasons for changes:

Analysis of reasons for changes:	Analysis of reasons for changes:	Analysis of reasons for changes:
The decreases in income from principal operations, profit from principal operations and net profit			when compared with	the same period of the
previous year were mainly due to the significant decline in the sales of float flat glass when compared with the same period last year.
Table 2:				Unit: RMB’000
	Jan-Sept 2002	Jan-Jun 2002	Percentage of total profit (%)
Items			Jan-Sept 2002	Jan-Jun 2002
Total profit/(loss)	(155,574 )	(114,975 )
Profit from principal operations	15,417	10,192	-9.91%	-8.86%
Expenses for the period	125,793	83,397	-80.84%	-72.53%
Investment income	(2,280 )	(2,692 )	1.47%	2.34%
Net non-operating income/expenses	(42,918 )	(39,078 )	27.58%	33.99%

Analysis of reasons for changes:

Profit from principal operations decreased. Even if sales volume increased during the reporting period, selling prices of flat glass bounced only slightly. Expenses for the period was balanced compared with the same period in the previous year due to an increase in loss, leading a change in the percentage of it to total profit. In the third quarter, investment loss expanded compared with the same period in the previous year, because subsidiaries continued to recorded loss. Net non-operating income/expenses arose from an increase in provision for bad loads.

2.

There were no other significant seasonal income or expenses nor material exceptional items of profit or loss.

Financial position					Unit: RMB’000
		Opening		Closing
Items	Opening	Percentage of	Closing	Percentage of	Increase
	Amount	total assets (%)	Amount	total assets (%)	(Decrease) %
Total assets	3,121,000		3,085,735		-1.14%
Trade debtors	154,158	4.94%	195,467	6.33%	21.13%
Other debtors	772,196	24.74%	774,742	25.11%	0.33%
Inventories	244,182	7.82%	213,530	6.92%	-14.35%

Analysis of reasons for changes:

Trade debtors increased 21.13% compared to the previous period, because of a decrease in recovery of account receivable and extension of outstanding period. Other debtors only slightly increased 0.33% compared to the previous period. Inventories decreased 14.35% compared to the previous period due to a drop in stock of goods.

1. There was no custody of funds of the Company during the reporting period.

2. Contingencies and Subsequent events

(1) The Company was not involved in any material arbitration during the reporting period. Continued litigations were as follow: On 30 December 1998 the Company placed a deposit in the sum of RMB23,000,000 with Yinji local branch of Zhengzhou branch of Guandong Development Bank (which had been upgraded to Yinji sub-branch of Zhengzhou branch of Guandong Development Bank on 28 December 1999) for a fixed term of one year commencing from 30 December 1998 to 30 December 1999 at an annual interest rate of 3.78%. The Yinji local branch of Zhengzhou branch of Guangdong Development Bank issued an Account Opening Certificate of Fixed Deposit. Subsequently, a dispute arisen when the Company made withdrawal of such deposit upon its maturity. The Yinji sub-branch of Zhengzhou branch of Guangdong Development Bank rejected the Company’s withdrawal on the ground of the defaulted repayment by Heuan Yinji Property Development Company Limited of the outstanding loan in the sum of RMB21,850,000 for which the Company provided a guarantee in favour of Shangcheng branch of Guangdong Development Bank in December 1998 and that the Company should perform its obligations as the guarantor. In 2001, the Company initiated legal proceedings in Henan High People’s Court and the hearings of the case had been completed pending judgement. Upon cross examination, the production of evidence and the defence of both parties in courts, the Company considered that based on the relevant notice, regulations and provision issued by the People’s Bank of China, the facts are favourable to the Company. It is likely that judgement will be made in favour of the Company. The management of the Company and the legal adviser acts for the Company in this case are confident in the recovering of the deposit.

• (2) The Company did not provide any guarantee for any other companies during the reporting period.

• (3) The Company did not have any significant post balance sheet events during the reporting period.

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1. Other significant events

(1) Recurring related party transactions

For all the transactions conducted by the Group during the period ended 30 September 2002, most of the parties and terms of transactions were determined by CLFG and the Group.

Transactions between the Group and CLFG and its fellow subsidiaries were as follows:

	Jul-Sept 2002	Jan-Sept 2002
	(unaudited)	(unaudited)
	RMB’000	RMB’000
Sales	3,246	8,680
Purchase of raw materials	7,188	30,319
Management expenses	—	—
Ancillary and social service	1,600	3,180
Provision of utilities	2,484	8,182
Interest paid and payable	3,295	17,808
Interest received and receivable	4,136	10,635
	Jul-Sept 2002	Jan-Sept 2002
	(unaudited)	(unaudited)
	RMB’000	RMB’000
Guarantee issued to suppliers
in favour of the Company	0	40,000
Guarantee issued to banks in
favour of the Company	85,000	324,000

Note:

The Board of Directors is of the opinion that all of the aforesaid transactions were conducted on daily course and with ordinary commercial terms. Such transactions were confirmed by the Company’s Independent non-executive directors.

• (2) Overdue deposit

This overdue deposit was provided. Details are as follows:	This overdue deposit was provided. Details are as follows:
Items	Amount	Ultimate Borrower	Provision%	Amount
	RMB’000			RMB’000
Others receivable	145,657	Guangzhou International	50	72,829
		Trust & Investment
		Corporation (“GZITIC”)

Note:

GZITIC can keep its trust license and is under re-organization. Upon knowledge of the latest progress, the Board of Directors believes provision of 50% (RMB72,828,000) was sufficient.

• (3) Accounts receivable from CLFG

Nature of	Interest	Commencing	Terms of repayment	Unaudited balance as	Percentage of trade
transaction	rate	year	and status	at 30 September 2002 (RMB)	and others debtors
Advances to Benway	6.5%	1998	Due on	26,692,000	2.43%
Development Limited	per annum		31 August 2000
(a wholly owned subsidiary			(not yet repaid)
of the CLFG) on behalf			Not secured
of CLFG
Trade debtors relating to	Interest free	before 1994	No fixed repayment	86,913,000	7.93%
sales of finished goods			Not secured
Accounts debtors relating	Interest free	before 1994	No fixed repayment	9,326,000	0.85%
to transfer of loans			Not secured
Other debtors relating to	Interest free	before 1994	No fixed repayment	42,122,000	3.84%
building of staff quarters			Not secured
Total				165,053,000	15.05%

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Accounts receivable from fellow subsidiaries

Company’s name	CLFG’s	Company’s					Unaudited
	interest	interest				Terms of	balance as at	Percentage
	in these	in these	Nature of	Interest	Commencing	repayment	30 September	of trade and
	Companies	Companies	transaction	rate	year	and status	2002 (RMB)	other debtors
Qingdao Taiyang Glass	55%	—	loan	6.53%-7.84%	1999	Due on 2004	347,676,000	31.70%
Industries Company				(per annum)		secured
Limited
Jingbao Decoration Glass	50%	10.28%	trade debtors	Interest free	Before 1994	No fixed	7,446,000	0.68%
Company Limited						repayment
						Not secured
CLFG Luoyang Hoisting	63.32%	36.68%	trade debtors	Interest free	Before 1994	No fixed	18,595,000	1.70%
Machinery Co. Ltd.						repayment
						Not secured
CLFG New Illuminating	70.55%	29.45%	trade debtors	Interest free	Before 1994	No fixed	1,167,000	0.11%
Source Company Limited						repayment
						Not secured
CLFC Jingwei Glass	64.1%	35.9%	trade debtors	Interest free	Before 1994	No fixed	55,986,000	5.11%
Fibre Co., Limited						repayment
						Not secured
CLFC Jingjiu Glass	68.92%	31.08%	trade debtors	Interest free	Before 1994	No fixed	14,061,000	1.28%
Container Co., Limited						repayment
						Not secured
Others			trade debtors	Interest free	Before 1994	No fixed	51,847,000	4.73%
						repayment
						Not secured
Total							496,778,000	45.30%

The reasons for the existence of the accounts receivable had been disclosed by the Company in the announcement dated 3 August 2001 and its existence was approved by independent shareholders. Such accounts receivable will be repaid in full by 31 December 2004.

• (4) It is expected that the Company may record loss for 2002.

4. FINANCIAL REPORT (UNAUDITED)

• (1) Financial Statements

• Condensed Consolidated Balance Sheet:

Prepared by Luoyang Glass Company Limited

Prepared by Luoyang Glass Company Limited
		Unit: RMB’000
Items	30 September 2002	31 December 2001
Current assets	1,368,155	1,314,346
Long-term investments	189,476	192,168
Net fixed assets	1,045,719	1,137,939
Intangible assets and other assets	482,385	476,547
Total assets	3,085,735	3,121,000
Current liabilities	1,431,263	1,271,947
Long-term liabilities	140,817	179,664
Minority interests	85,645	106,805
Shareholders’ funds	1,428,010	1,562,584
Total liabilities and shareholders’ funds	3,085,735	3,121,000
Condensed Consolidated income account
Prepared by Luoyang Glass Company Limited
		Unit: RMB’000
Items	Jul-Sept 2002	Jan-Sept 2002
Income from principal operations	234,770	587,301
Profit from principal operations	5,225	15,417
Expenses for the period	42,396	125,793
Investment gain/(loss)	412	(2,280 )
Non-operating income and expenses	(3,840 )	(42,918 )
Income tax	—	200
Loss attributable to minority interests	4,399	21,169
Net loss	(36,200 )	(134,605 )

1. Condensed Consolidated income account

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• (2) Notes to the Financial Statements

• There were no significant changes in the principal accounting polices, accounting estimates and scope of consolidation of the financial statements adopted by the Company compared with the 2002 Interim Report.

• There were no significant discrepancies between the principal accounting policies adopted in this quarterly financial report and those adopted in the financial report for the year 2002.

• The preparation method for consolidated statements: The preparation method and the scope of consolidated statements for this quarter are in conformity and have no significant changes compared with those adopted in 2002 Interim Report.

Board of Directors Luoyang Glass Company Limited Lui Baoying Chairman

28 October 2002

Please also refer to the published version of this announcement in The Standard/Hong Kong Economic Times.

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