This is one of the first high-tech companies in Guangdong province and Shenzhen. Shenzhen Changyuan New Material Co., Ltd., which our company invested in, has received the certification from both Ministry of Science and Technology and Chinese Academy of Sciences. This company engages in the research, production and sale of new materials and techniques. It mainly produces new materials used in electric power, electronics, communication, pipeline antisepsis, fine chemical engineering and other fields. Today, it is one of the biggest enterprises producing pyrocondensation materials and accessories for electric power and cables. In last few years, the company has maintained a sound operating condition. Consequently the revenue and profit has increased at a high rate. Its products established its market leader status compared with the competitors. In 2005, adopting the philosophy “guided by the market and focusing on efficiency”, this company has worked hard at exploring new products and improving techniques. It continued to improve its core competitiveness, made great effort to solve the problem of increasing price of raw materials and maintained a steady development. As a result, it successfully achieved its operating objectives set in early 2005. In 2005 it realized sales revenue of RMB 348 million. Moreover, it made a net profit of RMB 51.68 million, which exceeded its 2005 profit plan.

With the help of our company, Shenzhen Changyuan New Material Co., Ltd. has successfully accomplished its shareholder restructuring in 2005. According to the present market value, our company is likely to realize an increment of more than RMB 100 million for our stake in it. More importantly, the shareholder restructuring helps to unify shareholders interest, helps to form an effective binding and incentive mechanisms and lays a better foundation for the company’s development.