Shenzhen Zhongheng Huafa Co. Ltd.Stock Code: 000020 200020 Public Notice No.: 2021-09

Short Form of the Stock: SHEN HUAFA-A SHEN HUAFA-B

Shenzhen Zhongheng Huafa Co. Ltd.I. Important Notice

The summary is abstract from full-text of annual report for more details of operating results financial condition and future

development plan of the Company; investors should found in the full-text of annual report that published on media appointed by

CSRC.

Other directors attending the Meeting for annual report deliberation except for the followed

Name of director absent Title for absent director Reasons for absent Attorney

Prompt of non-standard audit opinion

□ Applicable √ Not applicable

Profit distribution pre-plan of common stock or capitalizing of common reserves pre-plan deliberated by the Board in the reporting

period

□ Applicable √ Not applicable

The Company has no plan of cash dividends carried out bonus issued and capitalizing of common reserves either.Profit distribution pre-plan of preferred stock deliberated and approved by the Board in the reporting period

□Applicable √ Not applicable

II. Basic information of the company

1. Company profile

Short form of the stock Shen HUAFA A Shen HUAFA B Stock code 000020 200020

Stock exchange for listing Shenzhen Stock Exchange

Person/Way to contact Secretary of the Board Rep. of security affairs

Name Niu Zhuo

Office add. 618 6/F East Tower No.411 Building

Huafa (N) Road Futian District Shenzhen

Fax. 0755-86360206

Tel. 0755-86360201

E-mail huafainvestor@126.com.cn

2. Main business or product introduction in the reporting period

After years of development the company has gradually formed two main businesses in industry and property

Shenzhen Zhongheng Huafa Co. Ltd.management. Among them the industrial business mainly includes injection molding polylon (light-weight

packaging materials) and complete machine production and sales of liquid crystal display property management

business is mainly the lease of its own property.

3. Main accounting data and financial indexes

(I) Main accounting data and financial indexes for recently three years

Whether it has retroactive adjustment or re-statement on previous accounting data

□Yes √ No

In RMB

2020 2019 Changes over last year 2018

Operating income 691742269.12 721557440.51 -4.13% 637046707.03

Net profit attributable to

shareholders of the listed company

6830187.40 5460049.15 25.09% 3295022.72

Net profit attributable to

shareholders of the listed company

after deducting non-recurring gains

and losses

4103393.55 4843096.96 -15.27% 1535043.65

Net cash flow arising from

operating activities

59719269.60 74463707.01 -19.80% -21894459.66

Basic earnings per share

(RMB/Share)

0.0241 0.0193 24.87% 0.0116

Diluted earnings per share

(RMB/Share)

0.0241 0.0193 24.87% 0.0116

Weighted average ROE 2.05% 1.67% 0.38% 1.02%

End of 2020 End of 2019

Changes over end of

last year

End of 2018

Total assets 627779621.06 614163899.86 2.22% 617090153.46

Net assets attributable to

shareholder of listed company

336248737.29 329428049.89 2.07% 323968000.74

(2) Quarterly main financial index

In RMB

First quarter Second quarter Third quarter Fourth quarter

Operating income 87800584.55 212902836.83 200183800.78 190855046.96

Net profit attributable to

shareholders of the listed company

-400741.17 3566338.72 1685488.94 2496470.28

Net profit attributable to

shareholders of the listed company

after deducting non-recurring gains

and losses

-208179.52 3376075.98 1108517.51 344348.95

Shenzhen Zhongheng Huafa Co. Ltd.Net cash flow arising from

operating activities

7931308.59 13268903.65 -7509489.19 46028546.55

Whether there are significant differences between the above-mentioned financial index or its total number and the relevant financial

index disclosed in the company’s quarterly report and semi-annual report

□Yes √ No

4. Shares and shareholders

(1) Particulars about common stock shareholders preference shareholders with voting rights recovered

and top ten shareholders

In Share

Total common

stock

shareholders in

reporting

period-end

21840

Total common

stock

shareholders at

end of last month

before annual

report disclosed

22456

Total preference

shareholders

with voting

rights recovered

at end of

reporting period

0

Total preference

shareholders with

voting rights

recovered at end of

last month before

annual report

disclosed

0

Top ten shareholders

Full name of

Shareholders

Nature of

shareholder

Proportion of

shares held

Amount of

shares held

Amount of restricted shares held

Number of shares

pledged/frozen

State of share Amount

Wuhan

Zhongheng

Group

Domestic

non-state-ow

ned legal

person

42.13% 119289894 0

Pledged 116100000

Frozen 119289894

SEG (HONG

KONG) CO.

LTD.

Overseas

legal person

5.85% 16569560 0

Pledged 0

Frozen 0

GOOD HOPE

CORNER

INVESTMENT

S LTD.Overseas

legal person

2.50% 7072000 0

Pledged 0

Frozen 0

Changjiang

Securities

Brokerage

(Hong Kong)

Co. Ltd.

Overseas

legal person

1.89% 5355249 0

Pledged 0

Frozen 0

Guoyuan

Securities

Brokerage

(Hong Kong)

Limited

Overseas

legal person

1.37% 3870117 0

Pledged 0

Frozen 0

Li Zhongqiu Overseas 1.00% 2830000 0 Pledged 0

Shenzhen Zhongheng Huafa Co. Ltd.nature

person

Frozen 0

LI SHERYN

ZHAN MING

Overseas

nature

person

0.51% 1446100 0

Pledged 0

Frozen 0

China

Merchants

Securities Hong

Kong Co. Ltd.State-owned

legal person

0.50% 1413888 0

Pledged 0

Frozen 0

Shengyin

Investment Co.Ltd.Overseas

legal person

0.50% 1408600 0

Pledged 0

Frozen 0

Li Senzhuang

Domestic

nature

person

0.37% 1041073 0

Pledged 0

Frozen 0

Explanation on associated

relationship among the

aforesaid shareholders

Among the top ten shareholders Li Zhongqiu is the actual controller of Wuhan Zhongheng New

Science & Technology Industrial Group Co. Ltd. and is a party acting in concert. Shengyin

Investment Co. Ltd. is an overseas wholly-owned subsidiary of Wuhan Zhongheng group.The

Company neither knew whether there exists associated relationship among the other shareholders

nor they belong to consistent actors that are prescribed in Measures for the Administration of

Disclosure of Shareholder Equity Changes of Listed Companies.

Explanation on involving

margin business (if

applicable)

N/A

(2) Total preferred stock shareholders of the Company and shares held by top ten shareholders with

preferred stock held

□ Applicable √ Not applicable

The Company had no shareholders with preferred stock held in the reporting.

(3) Property right and controlling relationships between the actual controllers of the Company and the

Company is as follows:

Li Zhongqiu Li Li (Son of Li Zhongqiu)

Wuhan Zhongheng New Science & Technology Industrial Group

Co. Ltd.

Shenzhen Zhongheng Huafa Co. Ltd.

51%

49%

42.21%

Shenzhen Zhongheng Huafa Co. Ltd.5. Corporate bonds

Whether or not the Company public offering corporation bonds in stock exchange which undue or without payment in full at

maturity on the approval date for annual report disclosed

No

III. Discussion and analysis of business

1. Introduction of operation in the reporting period

2020 was a very unusual year the sudden outbreak of COVID-19 epidemic caused the company's important

subsidiary in Wuhan to be affected by the epidemic the resumption of work and production was later than in other

areas of the country and the loss of orders was relatively serious. Faced with such a difficult business

environment all employees of the company worked together to actively overcame the adverse effects of the

epidemic complied with the industry environment and the adjustment of national policies broke through thinking

and management strategies and achieved good operating results.

In 2020 the company achieved operating revenue of 691.7423 million yuan a decrease of 4.13% on a

year-on-year basis total profits of 8.82 million yuan increased by 13.76% compared with the same period last

year net profit amounted to 6.8302 million yuan a 25.09% up from a year earlier.●Video service business achieved annual operating income of 396.06 million yuan an increase of 19.29% on a

year-on-year basis operation profit amounted as 6.4795 million yuan with 132.49% up from a year earlier. During

the reporting period the Video Business Division adjusted the product structure and optimized the sales ratio of

each brand of products. The sales ratio of AOC VSCN and VSC series brands have increased which opened

online sales channels such as Jingdong while completing existing customer orders and sold 900000 LCD

monitors in 2020 an increase of 9.68% over last year.●Injection molding business achieved annual operating income of 185.4917 million yuan a decrease of 25.86%

over the same period last year operation profit amounted as 548600 yuan an increase of 2.39% from a year

earlier. With the unceasingly fierce competition in the market the profit margin of injection molding was

squeezed but the new production line put into production by this business division at the end of 2018 gave full

play to its automation advantages in 2020 which greatly improved production efficiency and reduced production

costs. The injection molding division achieved annual sales volume of 9900 tons completed the annual sales

target.Shenzhen Zhongheng Huafa Co. Ltd.●Polylon business achieved annual operating income of 35.8333 million yuan a decrease of 44.30% over the

same period last year. Actual sales for the year were 2500 tons basically reaching the sales target. In order to

better fulfill the sales target of 2021 the EPS business division maintained existing orders increased the

proportion of structural parts orders developed new customer resources and strive to accept more domestic and

foreign large-scale household appliance customers’ orders.●The property rental business achieved annual operating income of 40.5875 million yuan an increase of 4.55%

from a year earlier operating profit amounted as 6 million yuan with a growth of 7.86% over that of last year. In

2020 the company optimized the structural proportion of commercial tenants and the occupancy rate was greatly

improved at the same time the company strictly controlled costs and reduced unnecessary expenditures.Therefore the company’s overall rental profits increased significantly compared with the previous year.

2. Whether the main business had major change in the reporting period

□ Yes √ No

3. About the industries products or regions accounting for over 10% of the company’s operating income

or operating profit

√Applicable □Not applicable

In RMB

Name

Operating

revenue

Operating cost Gross profit ratio

Increase/decrease

of operating

revenue y-o-y

Increase/decrease

of operating cost

y-o-y

Increase/decrease

of gross profit

ratio y-o-y

Monitor 396060015.82 6479543.15 6.63% 19.29% 132.49% 0.15%

Injection model 185491674.08 548642.72 9.40% -25.86% 2.39% -1.39%

EPS products 35833322.61 -4117636.91 -5.74% -44.30% -279.45% -9.07%

Property lease 40587453.21 6000207.46 86.87% 4.55% 7.86% -6.75%

4. Whether the characteristics of management seasonal or cyclical need special attention

□ Yes √ No

5. In the reporting period note of major changes in operating income operating cost total net profit

attributable to common stock shareholders of listed company or composing the previous reporting period

□ Applicable √ Not applicable

6. Facing delisting

□ Applicable √ Not applicable

Shenzhen Zhongheng Huafa Co. Ltd.7. Related matters relating to financial reports

(1) Particulars about the changes in aspect of accounting policy estimates and calculation method

compared with the financial report of last year

□ Applicable √ Not applicable

There was no change in aspect of accounting policy estimates and calculation method

(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 the period.

(3) Compare with last year’s financial report; explain changes in consolidation statement’s scope

√Applicable □ Not applicable

Combined

party

Percentage

of equity

acquired in

enterprise

combinatio

n

Constitute

the basis for

the

enterprise

combination

under

the same

control

Combining

date

Basis for

determinin

g the date

of

combinatio

n

Income of the

combined

party from the

beginning of

the period of

combination to

the date of

combination

Net profit of

the combined

party from the

beginning of

the period of

combination to

the date of

combination

Income of

the

combined

party

during the

compariso

n period

Net profit

of the

combined

party

during the

comparison

period

Ruth Co.Ltd.

100.00% 2020.11.10 Equity Tr

ansfer A

greement

Ruth Co. Ltd was established in Hong Kong dated 25 October 2020 with registered capital of HK$ 10000.00 no actual capital

contributed and has not yet commenced production and operation activities.