Abstract of 2018 Annual Report of Shenzhen SEG Co. Ltd

Stock code: 000058 200058 Stock abbreviation: SHEN SEG SHEN SEG B Notice No.: 2019-042

Abstract of 2018 Annual Report of Shenzhen SEG Co. Ltd.

I. Important Notice

The abstract of 2018 Annual Report is excerpted from the full text of 2018 Annual Report. For more details about the operating result

financial condition and future development planning investors shall read carefully the said full text published on the designated media

by China Securities Regulatory Commission (CSRC).

All directors other than the following directors have attended this board meeting and reviewed the annual report.

Name of director not present

Position of director not

present

Reason for absence Name of proxy

Zhang Liang Director For work Xu La Ping

Gao Jian Bai Director For work Chen Huijie

Zhang Yu Wang Director For work Chen Huijie

Song Pingping Independent director For work Fan Zhiqing

Notice of non-standard audit opinions

□ Applicable √ Not applicable

Proposal for profit distribution of common shares or proposal for transfer of capital reserves to share capital in the reporting period

reviewed by the Board of Directors

√ Applicable □ Not applicable

Transfer of capital reserves to share capital

□ Applicable √ Not applicable

According to the profit distribution plan deliberated and adopted by the meeting of the Board of Directors based on 1235656249

share capital the Company will distribute cash dividend of RMB 0.35 (tax included) for every 10 shares and 0 bonus share (tax

included) to all shareholders and will not transfer reserves into share capital.Proposal for profit distribution of preferred shares in the reporting period passed in the resolution of the Board of Directors

□ Applicable √ Not applicable

II. Company Profile

1.Basic Information

Stock abbreviation SHEN SEG SHEN SEG B Stock code 000058 200058

Listed on Shenzhen Stock Exchange

Contact and contact

information

Secretary of the Board of Directors Securities affairs representative

Name Peng Aiyun Shi Guangyin

Abstract of 2018 Annual Report of Shenzhen SEG Co. Ltd

Contact address

31/F Tower A Stars Plaza Huaqiang Road (N)

Futian District Shenzhen

31/F Tower A Stars Plaza Huaqiang Road (N)

Futian District Shenzhen

Fax 0755-8397 5237 0755-8374 7759

Tel. 0755-8374 7939 0755-8397 5237

E-mail segcl@segcl.com.cn shigy@segcl.com.cn

2. Main Business or Products in the Reporting Period

In 2018 the main business of the Company includes electronics markets commercial property operation and management business

commercial real estate business business hotel business and new energy business. Business model: On the basis of the electronics

markets commercial property operation and management business and commercial real estate business the Company combines

multiple business models utilizes the overall advantages of resource integration thus creates a business model combining multiple

business types and transforms itself into a platform for diversified strategic emerging industries.In the reporting period to avoid potential financial risks the Company transferred 62% of the equity of SEG Credit and ceased

microcredit business. For details of equity transfer see the Announcement on the Connected Transaction of Transfer of 62% of the

Equity of Shenzhen SEG Credit Co. Ltd. Held by the Company and its Holding Subsidiaries (No. 2018-010) and the Announcement

on the Progress of Transfer of 62% of the Equity of Shenzhen SEG Credit Co. Ltd. Held by the Company and its Holding Subsidiaries

(No. 2018-023) released by the Company in designated information disclosure media.

3. Main Accounting Data and Financial Indexes

(1) Main Accounting Data and Financial Indexes in the Recent Three Years

Are retrospective adjustments made to previous financial statements?

□ Yes √ No

Unit: RMB/Yuan

2018 2017

Year-on-year

increase/decrease

2016

Operating income (Yuan) 1605787472.11 1981307558.23 -18.95% 1371044982.11

Net profit attributable to

shareholders of the listed company

(Yuan)

27852740.23 219553261.10 -87.31% 246062783.31

Net profit attributable to

shareholders of the listed company

after deduction of non-recurring

profit and loss (Yuan)

17223506.49 148677556.32 -88.42% 22248698.60

Net cash flow arising from

operating activities (Yuan)

167674153.73 507386549.21 -66.95% 443535540.78

Basic EPS (Yuan/share) 0.0225 0.1777 -87.34% 0.1991

Diluted EPS (Yuan/share) 0.0225 0.1777 -87.34% 0.1991

Abstract of 2018 Annual Report of Shenzhen SEG Co. Ltd

Weighted average ROE 1.47% 11.96% -10.49% 11.15%

End of 2018 End of 2017

Year-on-year

increase/decrease

End of 2016

Total assets (Yuan) 7128009738.20 6992590420.75 1.94% 6923273093.64

Net assets attributable to

shareholders of the listed company

(Yuan)

1867881216.44 1917228370.15 -2.57% 2412301070.04

(2) Major Quarterly Financial Indexe

Unit: RMB/Yuan

Quarter 1 Quarter 2 Quarter 3 Quarter 4

Operating income 391140155.46 491797933.21 561704545.25 161144838.19

Net profit attributable to shareholders of the

listed company

62622931.80 35044056.14 40399673.95 -110213921.66

Net profit attributable to shareholders of the

listed company after deduction of

non-recurring profit and loss

27128268.89 15894541.24 35513724.94

-61313028.58

Net cash flow from operating activities -1165334.33 27272351.65 62306651.80 -10057214.63

Are there any significant differences between the financial indexes or their totals in the preceding table and those described in the

disclosed quarterly reports or semi-annual reports?

√ Yes ? No

Main financial indicators of the above points quarter excluding non-recurring gains and losses attributable to shareholders of

listed companies of the amount is in the second quarter net profit index has to disclose semi-annual report to reduce the amount of

$9834062 a first the main reason for the semi-annual report data to the company without audit annual report audit increases after seg

small credit loans impairment loss to sell deducting non-recurring gains and losses net profit to reduce but at the same time increase

the sale of seg small loan investment 9834062 RMB first so in the second quarter net profit attributable to shareholders of listed

companies are not affected.

4. Information on Shareholders

(1) Number of ordinary shareholders and number of preferred shareholders restored with the voting rights

and information on top 10 shareholders

Unit: Share

Total number of

ordinary

74761

Total number of

ordinary

70146

Total number of

preferred

0

Total number

of preferred

0

Abstract of 2018 Annual Report of Shenzhen SEG Co. Ltd

shareholders at the

end of the reporting

period

shareholders at the

end of the month

immediately before

the disclosure of the

annual report

shareholders

restored with the

voting rights

shareholders

restored with

the voting

rights at the

end of the

month

immediately

before the

disclosure of

the annual

report

Information on top 10 shareholders

Name of shareholder Nature of shareholder

Shareholding

percentage

Quantity of restricted shares

held

Information on pledged or

frozen shares

Share status Quantity

Shenzhen SEG Group Co.Ltd.State-owned legal person 56.70% 450857239 / /

Liu Guocheng Domestic natural person 0.57% / /

Liu Guohong Domestic natural person 0.26% / /

Gong Qianhua Overseas natural person 0.24% / /

China Securities Finance

Corporation Limited

Domestic

non-state-owned legal

person

0.18% / /

Xu Yue Ying Domestic natural person 0.15% / /

Shanghai Juzhang

Investment Management

Co. Ltd.

Domestic

non-state-owned legal

person

0.14% / /

Zeng Ying Domestic natural person 0.12% / /

China Hi-tech Group

Corporation

State-owned legal person 0.12% / /

Chongqing international

trust co. LTD. -

chongqing innovation

superiority to pick two

letter collection trust funds

Fund financial products

etc

0.10% / /

Explanations on the association relationship or

concerted action among the above-mentioned

shareholders

Shenzhen SEG Group Co. Ltd has no association with other shareholders nor

it is a concerted action unit as described by the Management Methods for

Disclosure of Information on Changes in Shareholding Status of Shareholders

of Listed Companies It is unknown whether other shareholders have an

association relationship or are concerted action units or not.

Abstract of 2018 Annual Report of Shenzhen SEG Co. Ltd

Information on shareholders participating in financing

business (if any)

None.

(2) Number of preferred shareholders and information on top 10 preferred shareholders

□ Applicable √ Not applicable

In the reporting period preferred shareholders do not hold shares.

(3) Block diagram of the property rights and controlling relationship between the Company and its actual

controller

Shenzhen Oriental

Fortune Capital

Co. Ltd.

Shenzhen SEG Co. Ltd.

China Great Wall

Asset Management

Co. Ltd.

Shenzhen Kunpeng

Equity Investment

Co. Ltd.

Shenzhen SEG Group Co. Ltd.Shenzhen Capital

Co. Ltd.

State-owned Assets

Supervision and

Administration

Commission of

Shenzhen

42.85%

100%

26.12% 13.72 9.8% 7.51%

56.7%

5. Information on corporate bonds

Has the Company issued and listed on the stock exchange corporate bonds that are not due or due but cannot be repaid in full on the

approved release data of the annual report?

Yes

(1)Basic Information about Corporate Bonds

Bond name

Bond

abbreviation

Bond code Maturity date

Bond balance (RMB

10000)

Interest rate

Corporate bonds publicly issued by

Shenzhen SEG Co. Ltd. to qualified

investors in 2018 (1st issue) (category 1)

18 SEG 01 112836.SZ 2021-12-25 70000 4.60%

Corporate bonds publicly issued by

Shenzhen SEG Co. Ltd. to qualified

18 SEG 02 112837.SZ 2020-06-25 10000 4.15%

Abstract of 2018 Annual Report of Shenzhen SEG Co. Ltd

investors in 2018 (1st issue) (category 2)

Repayment of the principal and interest of corporate bonds

in the reporting period

None

(2)Rating of Corporate Bonds

According to the regulations of the regulatory authorities and the tracking rating system of CSCI Pengyuan Credit Rating Co. Ltd.

(hereinafter referred to as "CSCI Pengyuan") after the initial rating was completed on November 2 2018 during the life of the bonds

subject to rating CSCI Pengyuan will carry out a regular tracking rating and disclose regular tracking results within two months after

the disclosure of the Company's annual report. During the life of the bonds CSCI Pengyuan will also carry out irregular tracking

ratings as the case may be. In the process of tracking rating CSCI Pengyuan will maintain the consistency of the rating standards.

CSCI Pengyuan will keep eyes on information about the rated object and will promptly carry out irregular tracking ratings as it thinks

necessary. CSCI Pengyuan will analyze relevant matters and decide whether to adjust the credit rating of the rated object.If the Company does not cooperate on due diligence for tracking rating or fails to provide information for tracking rating CSCI

Pengyuan shall have the right to analyze public information about the rated object adjust the credit rating and if necessary may

announce the credit rating temporarily invalid or terminated.

CSCI Pengyuan will timely publish tracking rating reports in its website (www.cspengyuan.com) website of the Stock Exchange and

website of Securities Association of China and shall disclose such reports in the website of the Stock Exchange no later than

disclosure in other channels.

CSCI Pengyuan formerly known as Pengyuan Credit Rating Co. Ltd. was renamed to CSCI Pengyuan Credit Rating Co. Ltd. on

November 5 2018. The website of CSCI Pengyuan was changed from www.pyrating.cn to www.cspengyuan.com.

According to the initial rating of the corporate bonds by CSCI Pengyuan on November 2 2018 the credit rating of the corporate bonds

is AAA the long-term credit rating of the issuer is AA and the outlook for rating is stable. For details see the Credit Rating Report for

Corporate Bonds Publicly Issued to Qualified Investors in 2018 disclosed by the Company in http://www.cninfo.com.cn on December

20 2018.

(3)Main Accounting Data and Financial Indicators of the Company for Recent Two Years As of the End of

the Reporting Period

Unit: RMB 10000

Item 2018 2017 Change year on year

Asset-liability ratio 65.63% 63.09% 2.54%

EBITDA-to-total-debt ratio 11.54% 35.07% -23.53%

Interest coverage ratio 1.97 3.98 -50.62%

III. Management Discussion and Analysis

1. Overview

Should the Company abide by the disclosure requirements of special industries?

Abstract of 2018 Annual Report of Shenzhen SEG Co. Ltd

Yes.Real estate industry

In 2018 by more efforts in control integration and upgrading the company promoted the transformation and upgrading of

electronics markets continuously improved the service quality of electronics markets and created a business model combining

multiple business types so as to maintain stable business in electronics markets and continuously consolidate the industry position of

electronics markets. At the same time by promoting refined management and being dedicated to user value the Company

continuously improved service quality so that the quality and efficiency of property management were significantly improved and

property operation saw a steady rise. Driven by reform and guided by innovation the Company actively explored the deployment of

strategic emerging industries. Its first production line for the PV industry was completed and put into trial production. SegMaker+

smart parking lots and other new projects achieved preliminary results. Based on the existing industrial business supported by

investment mergers & acquisitions reform and innovation the Company continuously expanded the industrial chain actively

transformed itself into a platform for diversified strategic emerging industries and continuously enhanced and strengthened its core

competitiveness and sustainable development capabilities

2. Are there significant changes in main business in the reporting period?

□ Yes √ No

3. Information on products accounting for over 10% of operating income or operating profit

□ Yes √ No

4. Are there seasonal or cyclical characteristics of the operation needing special attention?

□ Yes √ No

5. Notes to significant changes in the operating income operating costs total net profit attributable to

common shareholders of the listed company or composition in the reporting period over the previous

reporting period

? Applicable ? Not applicable

During the reporting period the Company's total business income was about 1.612 billion yuan down 418 million yuan from the

same period last year with a decline of 20.60%; and the total profit was about 94 million yuan down by about 346 million yuan from

the same period last year with a decline of 77.98%. The main reasons for the decline in income are: ① The sales of SEG New Urban

decreaed by 131 million yuan compared with the same period last year; and ② The Company disclosed the Annouancement of

Prompting Risks of the Issues Relating to the Controlled Sub-subsidiary Receivng the Notice of Cancelling Contract on April 16 2019

based on the provisions of ASBE No. 29 Matters After the Date of Balance Sheet during the period between the said date and the date

of being approved for submittal the sales of products confirmed in the period when the Balance Sheet locates or the previous period

must be transferred back to the matters after the date of Balance Sheet to be adjusted the Balance Sheet which was prepared on the

said date shall be adjusted accordingly. Consequently the Company transferred back the sales of Floors 2 to 5 of Buildding 1 of SEG

New Urban Phase I leading to the deduction of approximately 300 million yuan in this reporting period. The main reasons for the

decline in total profit are: ① The profit of Huakong SEG the shareholding company decreaded compared with the same period last

year leading to the deduction of 26 million yuan of total profit of the Company; ② In the reporting period the Company accrued the

Abstract of 2018 Annual Report of Shenzhen SEG Co. Ltd

provision of asset impairment increasing by about 80 million yuan; ③ In the reporting period because of delaying the delivery of

reeal estate and postponing the completion of the procedures of applying for ownership certificate the compensation of breaching

contract is estimated to make the total profit decrease by 123 million yuan; ④ The tranferring back the sales of Floors 2 to 5 of

Buildding 1 of SEG New Urban Phase I resulted in the deduction of 77 million yuan of total profit; and ⑤ Because the financial

expense increaed owing to the completion of real estate project which stopped the securitization of financial expense and the

Company saved the management expense these two factors made the period expenses rose by about 35 million yuan on yeay onyeay

basis.

6. Information on Listing Suspension or Abortion

□ Applicable √ Not applicable

7. Information on Financial Report

(1) Information on changes in accounting policies accounting estimates and accounting methods compared

with the financial reports of the last year

√ Applicable ? Not applicable

On June 15 2018 the ministry of finance issued the notice on the revision and issuance of the format of general financial

statements of enterprises for the year 2018 (caijing [2018] no. 15) requiring non-financial enterprises that implement the accounting

standards for enterprises to prepare financial statements in accordance with the accounting standards and notification requirements for

enterprises. The company shall change the format of the financial statements in accordance with the requirements of the

above-mentioned financial and accounting document no. 15 [2018].

(2) Information on retroactive restatements in corrections of major accounting errors in the reporting

period

□ Applicable √ Not applicable

There is no retrospective restatement due to corrections on significant accounting errors in the reporting period.

(3) Information on changes in the scope of consolidation compared with the financial report of the last year

√ Applicable ? Not applicable

Compared with the previous period the number of subjects included in the consolidated financial statements of the current period

increased by 1 and decreased by 3 among which:

1. Subsidiaries newly incorporated into the scope of merger in the current period special purpose subjects and operating entities that

form control rights through entrusted operation or lease

Company name Reason for change

Hangzhou SEG Longyan Energy Technology Co. Ltd. Newly established

2. Subsidiaries special purpose entities and operating entities that have lost control by means of entrusted operation or leasing that are

no longer included in the scope of merger in the current period

Company name Reason for change

Shenzhen SEG Credit Co. Ltd Transfer of all the equity

Abstract of 2018 Annual Report of Shenzhen SEG Co. Ltd

Xi'an Fengdong New Town SEG Times Plaza Properties Co.Ltd.

Company cancellation

Yantai SEG times square development co. LTD Company cancellation