Abstract of the 2013 Annual Report of Shenzhen Chiwan Wharf Holdings Limited Stock code: 000022/200022 Stock abbreviation: Chiwan Wharf A / Chiwan Wharf B Announcement No.: 2014-012 SHENZHEN CHIWAN WHARF HOLDINGS LIMITED ABSTRACT OF THE 2013 ANNUAL REPORT
1. Important reminders
This abstract is based on the full text of the annual report. For more details, investors are suggested to read the full text disclosed at the same time with this abstract on the website of Shenzhen Stock Exchange or any other website designated by China Securities Regulatory Commission.
The Annual Report is written in both English and Chinese. In case of any discrepancy between the two versions, Chinese version prevails.
According to certain regulations issued by China Securities Regulatory Commission, the Company needn't to prepare Financial Statements under International Financial Reporting Standards, and thus all the financial data disclosed in this report were prepared under Chinese Accounting Standards.
Company profile:
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|Stock abbreviation|Chiwan Wharf A, Chiwan Wharf B|Stock code|000022, 200022|
|Stock exchange listed with|Shenzhen Stock Exchange|||
|For contact|Company Secretary|Securities Affairs Representative||
|Name|Ms. Bu Dan|Ms. Hu Jingjing||
|Tel.|+86 755 26694222|+86 755 26694222||
|Fax|+86 755 26684117|+86 755 26684117||
|E-mail|cwh@cndi.com|cwh@cndi.com||

2. Financial highlights and change of shareholders
（1）Financial highlights
Unit: RMB
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|-|-|-|-|-|
||||Increase or decrease of||
||2013|2012||2011|
||||this year over last year||
|Total operating income|1,780,774,836.30|1,783,846,134.76|-0.17%|1,708,136,899.00|
|Net profit attributable to shareholders of|502,894,547.79|467,103,270.43|||
||||7.66%|505,645,137.00|
|the parent|||||
|Net profit attributable to shareholders of|||||
|the parent after extraordinary gains and|502,469,158.84|464,592,323.43|8.15%|505,629,810.00|
|losses|||||
|Net cash flows from operating activities|897,178,297.23|698,472,452.71|28.45%|746,190,596.00|
|Basic EPS (RMB Yuan/share)|0.780|0.724|7.73%|0.784|
|Diluted EPS (RMB Yuan/share)|0.780|0.724|7.73%|0.784|
|ROE (%)|13.26%|13.15%|0.11%|15.19%|
||||Increase or decrease of||
||As at 31 Dec. 2013|As at 31 Dec. 2012|this year-end than last|As at 31 Dec. 2011|
||||year-end||
|Total assets|7,346,529,214.70|6,781,130,451.10|8.34%|6,540,228,435.00|
|Tatal shareholder’s equity attributable to|3,947,846,392.77|3,678,032,085.18|||
||||7.34%|3,467,796,751.00|
|equity holders of the parent|||||

Abstract of the 2013 Annual Report of Shenzhen Chiwan Wharf Holdings Limited（2） Shareholdings of the top 10 shareholders
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|||37,120 shareholders, with 29,087being A-share holders, and 8,033 beingB-share holders||||Total number of shareholders at|||35,762 shareholders, with 27,490being A-share holders, and 8,272being B-share holders|||||
||Total number of|||||||||||||
|||||||the end of the fifth trading day||||||||
||shareholders at the end|||||||||||||
|||||||before the disclosure date of the||||||||
||of the reporting period|||||||||||||
|||||||annual report||||||||
||Shareholdings of top ten shareholders (all being shareholders holding shares not subject to trading moratorium)|||||||||||||
|||||||Percentage of||Shares not subject|||Shares||Type of|
|||||Nature of||||||||||
||Name of shareholder (full name)|||||shareholding||to trading|||pledged or||shares (A, B,|
|||||shareholder||||||||||
|||||||(%)||moratorium (share)|||frozen (share)||H or other)|
|CHINA NANSHAN DEVELOPMENT(GROUP) INC.|||||32.52%||209,687,067|||0||A share||
|SHENZHEN MALAI STORAGE CO., LTD.|||||25%||161,190,933|||0||A share||
|KEEN FIELD ENTERPRISES LIMITED|||Foreign-funded||8.58%||55,314,208|||Unknown||B share||
|CMBLSA RE FTIF TEMPLETON ASIANGRW FD GTI 5496|||Foreign-funded||7.43%||47,914,954|||Unknown||B share||
|GOVERNMENT OF SINGAPORE INV.CORP.- A/C "C"|||Foreign-funded||0.66%||4,275,390|||Unknown||B share||
|BAYVK A2-FONDS|||Foreign-funded||0.58%||3,732,089|||Unknown||B share||
|EMPLOYEES PROVIDENT FUND|||Foreign-funded||0.56%||3,586,266|||Unknown||B share||
|TEMPLETON ASIAN GROWTH FUND|||Foreign-funded||0.41%||2,657,852|||Unknown||B share||
|BBH A/C VANGUARD EMERGINGMARKETS STOCK INDEX FUND|||Foreign-funded||0.4%||2,595,918|||Unknown||B share||
|CMBNA/STICHTING PENS FND ABP|||Foreign-funded||0.39%||2,504,856|||Unknown||B share||
||||China Merchants Holdings (International) Co., Ltd. (“CMHI”) was a shareholder of ChinaNanshan Development (Group) Inc. (“CND Group”), Shenzhen Malai Storage Co., Ltd.(Malai Storage) was a wholly-funded subsidiary of CMHI, and Keen Field EnterprisesLimited (KFEL ) was also a wholly-funded subsidiary of CMHI. Other than that, theCompany does not know whether the other non-restricted shareholders are related partiesor not.|||||||||||
||Explanation on associated relationship or/and|||||||||||||
||persons acting in concert among the|||||||||||||
||above-mentioned shareholders:|||||||||||||

（3）Relation between the Company and its actual controller in the form of diagram
State-Owned Assets Supervision and
Administration Commission of the State Council
100%
China Merchants Group
55.10%
China Merchants Holdings (International)
Company Limited
entrusted to
manage 100% 100% 37.02%
32.52% of the
Company's Shenzhen Malai Keen Field Enterprises China Nanshan Development
shares held by Storage Co., Ltd. Limited (Group) Incorporation
CND
25% 8.58% 32.52%
Shenzhen Chiwan Wharf Holdings Limited
Abstract of the 2013 Annual Report of Shenzhen Chiwan Wharf Holdings Limited Note 1: On 17 Sept. 2012, CMHI and CND Group signed the “Agreement of China Merchants Holdings (International) Co., Ltd. and China Nanshan Development (Group) Inc. Concerning Custody of Shares of Shenzhen Chiwan Wharf Holdings Limited”. According to the Agreement, CND Group would entrust CMHI as a custodian with its 370,878,000 A-shares in the Company (representing a shareholding percentage of57.52%). The custody announcement (No. 2012-035) was released on 20 Sept. 2012 on Securities Times, Ta Kung Pao (HK) and www.cninfo.com.cn. Meanwhile, CMHI indirectly holds 55,314,200 B-shares of the Company (representing a shareholding percentage of8.58%) via its wholly-funded subsidiary KFEL. As such, CMHI controls66.10% equity interests of the Company.
On 1 Nov. 2012, China Securities Regulatory Commission issued the ZJXK[2012] No. 1428Document—“Reply on Approving China Merchants Holdings (International) Company Limited to Disclose the Acquisition Report on Shenzhen Chiwan Wharf Holdings Limited and Exempting It from the Tender Offer Duty”, exempting its tender offer duty due to being the custodian of 370,878,000 shares of the Company, which made it the controller of theCompany’s 426,192,200 shares in all, accounting for66.10% of theCompany’s total shares.
The actual controller of the Company remained China Merchants Group after the entrustment.
Note 2: On 27 Dec. 2012, CND Group and Malai Storage signed the “Agreement between China Nanshan Development (Group) Inc. and Shenzhen Malai Storage Co., Ltd. Concerning Transferring Shares of Shenzhen Chiwan Wharf Holdings Limited”. According to the Agreement, CND Group transferred a number of 161,190,933 RMB ordinary shares of the Company (representing a shareholding percentage of25%) to Malai Storage. The said transaction was approved by SASAC of the State Council and the transfer registration formalities were finished, with the relevant announcements (No. 2013-019 and No. 2013-030) disclosed Securities Times, Ta Kung Pao (HK) and www.cninfo.com.cn dated 12 Mar. 2013 and 27 Apr. 2013 respectively. After the equity transfer, CMHI indirectly held 161,190,933 A-shares of the Company (a stake of25%) via its wholly-funded subsidiary Malai Storage, and held 55,314,208 B-shares of the Company (a stake of8.58%) via its wholly-funded subsidiary KFEL, representing a combined stake of33.58% in the Company. Meanwhile, CMHI was entrusted to manage the 209,687,067 A-shares of the Company (a stake of32.52%) held by CND Group, which meant that CMHI controlled a stake of66.10% in the Company. The actual controller of the Company remained China Merchants Group.
3. Discussion and analysis by the management
(1) Review of operation in the reporting period
The Company is principally engaged in the handling, warehousing and transportation of containers and bulk cargoes, as well as the provision of related services.
The global economy saw a gradual and non equilibrium recovery in 2013. Stimulated by quite a few rounds of quantitative easing and the re-industrialization progress, the U.S. economy kept recovering. Euro-zone economies bottomed out and showed a slight growth. Japan saw a strong rebound upon a series of economic stimulus policies, with the deflation situation improved. Emerging economies commenced re-structuring and slowed down in the overall growth. AndChina’s economy was stable and recorded a GDP growth of7.7% for 2013, with foreign trade showing a growth of7.6% from last year. Meanwhile, International Monetary Fund (IMF) estimated a growth of3.0% and2.7% in 2013 for the global economy and trade respectively.
Overcapacity still existed in the container shipping market and liner companies generally suffered from gloomy earnings. Due to a weak foreign demand and increasing competition among wharfs, the container business of the Company was under a lot of pressure. However, the Company still managed to maintain relative stability of its container throughput and market share through proactively expanding local import and export cargo resources, near-sea shipping routes, liner branch routes and emerging business. As for the bulk cargo business, in view of a sluggish demand in foreign trade, the Company adapted itself to the said market change and proactively sought for more needs in inner trade, which offset the drop in the cargo volume caused by the declining foreign trade. In addition, the operation rates for main cargos were effectively increased.
For the reporting year, the Company achieved a container throughput of 5,346 thousand TEU, representing a small YoY increase of0.7%, slightly lower than the1.7% growth of the average container throughput of all Shenzhen wharfs. The container throughput of the Company represented a23% market share of Shenzhen wharfs, almost the same as last year. Chiwan port achieved a throughput of 3,990 thousand TEU, a1.1% increase over last year. Throughout the year, the bulk cargo throughput achieved by the Company was 13,311 thousand tons, up24.4%
over last year. To be specific, Chiwan Port optimized its business structure and achieved a throughput growth of
10.6% over last year despite limited resources. And Machong Port saw the gradual release of new resource
Abstract of the 2013 Annual Report of Shenzhen Chiwan Wharf Holdings Limited capacity, which resulted in a considerable throughput growth of46.2% over last year.
For the year 2013, the Company achieved a total throughput of 65.894 million tons, representing an increase of7.1% over 2012, of which Chiwan Port achieved 59.806 million tons, up4.2% over 2012, accounting for25.6% of the overall throughput at Shenzhen ports, up by 40 basic points as compared with 2012.
Business highlights of the Company for the past three years are set out as follows:
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|-|-|-|-|
|Business highlight|2013|2012|2011|
|Total throughput (thousand tons)|65,894|61,533|63,840|
|Among which: Container throughput (thousand TEU)|5,346|5,311|5,793|
|Chiwan Port|3,990|3,946|4,122|
|Mawan Port|1,356|1,365|1,671|
|Throughput of bulk cargos (thousand tons)|13,311|10,699|9,251|
|Chiwan Port|7,223|6,534|6,532|
|Machong Port|6,088|4,165|2,719|
|Hours charged for tow trucks (thousand hours)|1,230|1,179|1,231|
|Hours charged for tugboats (hour)|30,247|31,707|32,121|

 In 2013, the Company attached importance to and continued improving customer service to stabilize core customers. Meanwhile, it proactively sought for new customers and adopted more flexible business strategies to enhancecustomers’ reliance on it and its routes. It also enhanced exchange and cooperation with other wharfs in the region to maintain a good order in market competition.
The Company pushed forwardR&D innovation and lean management; increased operation efficiency and resource utilization efficiency through operation process improvement, work flow optimization and technical innovation; and eased the pressure brought by limited resources and rising labor cost. In 2013, the Company accelerated the transition from technical innovation achievements to actual productivity, which produced an excellent result. It also vigorously carried forward innovation in organization, management and mechanism. Through a series of lean management measures such as optimization of the organizational structure, IT application in management and cost control, the Company successfully reduced costs, increased efficiency and greatly improved the overall management capability.
(2) Outlook of theCompany’s future development
1) Development trends and competition status of the industry in which the Company is engaged
In 2014, the global economy will keep the moderate recovery trend with the overall situation expected to be better than 2013. However, there will still be challenges such as withdrawal of American QE, the weak European economy and re-structuring of emerging markets. It will be difficult to see a fundamental improvement of the supply and demand imbalance in the shipping market, and the freight rates may fluctuate more frequently. “Allied container shipping” of liner companies will keep upgrading and the global map of liner routes may be re-drawn. New opportunities and challenges are ahead for container wharfs.
Thanks to more and more in-transit containers, the container throughput of Shenzhen surpassed Hong Kong and became No. 3 in the world in 2013. But in the long run, the declining foreign demand and the ongoing industry relocation from the Pearl River Delta will lead to a limited growth of containerizable goods in the hinterland, and the container throughput of Shenzhen wharfs will enter a period of steady growth at a low speed.
In terms of its container business in the long run, the Company will devote itself to maintaining stable core clients and main shipping routes through increasing the wharf operation efficiency and carrying out a quality service strategy. Meanwhile, along with the upgrading of the berths, there will still be some room for the throughput to
grow. As for the bulk cargo business, the overall resource capability of the Company improves significantly as the
wharf of Machong Phase II is put into use. The Company becomes a stronger competitor in the traditional cargo
market and there is room for it to expand the emerging cargo market. In the future, the bulk cargo business of the
Company will keep growing steadily.
Abstract of the 2013 Annual Report of Shenzhen Chiwan Wharf Holdings Limited 2) Business plan for 2014
The Company will pay close attention to developments in the macro-economy and social changes, proactively study the industry situation and market changes, and adjust operating strategies based on its actual situation so as to maximize operating earnings.
In terms of the container business, the Company will proactively deal with more and more larger ships and allied liner companies, as well as push forward the upgrading of berths. It will take the initiative to seize market opportunities and expand local cargo sources and near-sea shipping routes. And it will also continue to optimize the port environment and increase the customs clearance efficiency.
As for the bulk cargo business, the Company will put the wharf of Machong Port Phase II into use as scheduled, input great efforts in business expansion, and accelerate market cultivation. It will also carry forward the relocation of the fertilizer business to Machong Port step by step as planned. At the same time, it will try to achieve the optimal resource allocation and a coordinative development between Chiwan Port and Machong Port. The Company will continue to provide quality and efficient comprehensive port services for clients, and maintain a steady growth of the overall business scale. Meanwhile, it will seek for cooperation with other wharfs in the region to keep competition in a healthy state. It will also deepenR&D innovation and lean management; improve resource utilization efficiency and the overall management capability; and carry on with its various tasks such as reducing costs and increasing efficiency, saving energy and reducing emission, and building green wharfs. 3) Capital needs and expenditure plan for 2014
To implement our future development strategies and achieve business goals we have set, a capital expenditure of RMB 334.68 million is planned for 2014, of which RMB 193.11 million will be invested in wharf warehouses, RMB 106.32 million in equipments and ships, RMB 15.80 million in IT and RMB 19.45 million in administration and offices. The above capital expenditures will be mainly funded by cash inflows from operating activities of the Company and bank borrowings.
(3) No significant change occurred to the structures of main business lines and profit during the reporting period, and operating revenue was almost the same as that of last year. Main financial indicators are as follows:
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|-|-|-|-|
|Item|2013|2012|+/-|
|Total operating income|1,780,774,836.30|1,783,846,134.76|-0.17%|
|Operating profit|759,282,870.84|737,084,907.08|3.01%|
|Net profits attributable to shareholders of the parent|502,894,547.79|467,103,270.43|7.66%|

 Operating profit went up by3.01% mainly because① business tax and surtaxes recorded a considerable drop of89% when VAT replaced business tax;② RMB appreciation generated exchange earnings; and③ jointly-run and associated companies recorded YoY growth in profit due to the macro market environment, bringing up the relevant investment earnings by22% on the year-on-year basis. Net profit attributable to shareholders of the Company (without subsidiaries) recorded a growth of7.66% mainly because① the extension of Berth13# was put into use in Aug. 2012, which enabled the Company to enjoy a preferential treatment of relevant income tax reduction or exemption; and② interest expenses decreased, RMB appreciated and financial expenses decreased. 4. Matters in relation to financial reporting
(1) Explain any change of the accounting policies, accounting estimates or accounting methods as compared with the financial reporting of last year
According to “Motion to change the provision method and proportion of accounts receivables” considered and
approved on the 4th Special Session of the 7th Board of Directors for 2013 on 8 Mar. 2013. The announcement on
the said change of accounting estimates (announcement No.: 2013-018) was released on Securities Times, Ta
Kung Pao (HK) and www.cninfo.com.cn dated 12 Mar. 2013.
The changes in accounting estimates reduced the consolidated net profit for the year 2013 by RMB 295,850.01, of
which RMB 216,791.16 attributable to shareholders of the parent company's net profit.
Abstract of the 2013 Annual Report of Shenzhen Chiwan Wharf Holdings Limited (2) Explain any retrospective restatement due to correction of any significant accounting error in the reporting period
N/A
(3) Explain change of the consolidation scope as compared with the financial reporting of last year
Unchanged
(4) Explanation of the Board of Directors and the Supervisory Committee concerning the “non-standard audit report” issued by the CPAs firm for the reporting period
N/A
For and on behalf of the Board
Zheng Shaoping
Chairman
Shenzhen Chiwan Wharf Holdings Limited
Dated 29 March 2014