Post on 06-Feb-2018
www.zte.com.cn
stock code : 000063.SZ 763.HK
2014Annual Report
201
4Annual R
eport
ImportantThe Board of Directors, Supervisory Committee and the Directors, Supervisors and senior management of the Company confirm that this report does not contain any false information, misleading statements or material omissions, and collectively and individually accept responsibility for the truthfulness, accuracy and completeness of the contents of this report.
There are no Directors, Supervisors or senior management who do not warrant or who dispute the truthfulness, accuracy and completeness of the contents of this report.
This report has been considered and approved at the Twenty-fifth Meeting of the Sixth Session of the Board of Directors of the Company. Mr. Dong Lianbo, Director, was unable to attend the Meeting due to work reasons and has authorised Mr. Xie Weiliang, Vice Chairman, to vote on his behalf. Mr. Wei Wei, Independent Non-executive Director, was unable to attend the Meeting due to work reasons and has authorised Mr. Tan Zhenhui, Independent Non-executive Director, to vote on his behalf. Mr. Chen Naiwei, Independent Non-executive Director, was unable to attend the Meeting due to work reasons and has authorised Ms. Qu Xiaohui, Independent Non-executive Director, to vote on his behalf.
The respective financial statements of the Group for the year ended 31 December 2014 were prepared in accordance with PRC Accounting Standards for Business Enterprises and with Hong Kong Financial Reporting Standards respectively, and had been audited by Ernst & Young Hua Ming LLP and Ernst & Young, and an unqualified auditors report has been issued by each of them.
During the year, there was no significant deficiency in internal control in relation to financial reporting of the Company, nor was any significant deficiency in internal control in relation to non-financial reporting identified.
Mr. Hou Weigui, Chairman of the Company, Mr. Wei Zaisheng, Chief Financial Officer of the Company and Mr. Shi Chunmao, Head of Finance Division of the Company, hereby declare that they warrant the truthfulness, accuracy and completeness of the financial reports contained in this report.
In view of the state of affairs of the Company, proposal for profit distribution and conversion from capital reserve of 2014: cash dividend of RMB2.0 for every 10 shares (before tax) based on the Companys total share capital of 3,437,541,278 shares as at 31 December 2014, creation of 2 shares for every 10 shares by way of conversion of capital reserve. The aforesaid matter shall require consideration and approval at the general meeting.
This report contains forward-looking statements in relation to subjects such as future plans, which do not constitute any specific undertakings to investors by the Company. Investors should beware of investment risks.
This report has been prepared in Chinese and English respectively. In case of discrepancy, the Chinese version shall prevail, except for the financial report prepared in accordance with Hong Kong Financial Reporting Standards, of which the English version shall prevail.
China Securities Journal, Securities Times, Shanghai Securities News and http://www.cninfo.com.cn are designated media for the Companys information disclosure. Only information of the Company published in the aforesaid media should be relied upon. Investors are asked to beware of investment risks.
ContentsDefinitions
Glossary
Company Profile
Corporate information
Chairmans statement
Major events of the Group
Highlights of accounting and financial indicators
Report of the board of directors
Management discussion and analysis
Material matters
Changes in shareholdings and information of shareholders
Directors, supervisors, senior management and employees
Corporate governance structure
Internal control
Report of the PRC auditors
Financial statements prepared in accordance with PRC ASBEs and notes thereto
Independent auditors report
Financial statements prepared in accordance with HKFRSs and notes thereto
Documents available for inspection
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ZTE CORPORATION
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DefinitionsIn this report, unless the context otherwise requires, the following terms shall have the meanings set out below. Certain other terms are explained in the section headed Glossary.
Company or ZTE ZTE Corporation, a limited company incorporated in China, the shares of which are listed on the Shenzhen Stock Exchange and the Hong Kong Stock Exchange, respectively
Articles of Association The Articles of Association of ZTE Corporation
Company Law Company Law of the Peoples Republic of China
Securities Law Securities Law of the Peoples Republic of China
Accounting Law Accounting Law of the Peoples Republic of China
Group ZTE and one or more of its subsidiaries
Board of Directors The board of directors of the Company
Directors Members of the board of directors of the Company
Supervisory Committee The supervisory committee of the Company
Supervisors Members of the supervisory committee of the Company
China or PRC The Peoples Republic of China
ITU International Telecommunications Union, is a specialised agency of the United Nations for information and communication technologies
SASAC State-owned Assets Supervision and Administration Commission of the State Council
CSRC China Securities Regulatory Commission
Shenzhen CSRC The CSRC Shenzhen Bureau
Shenzhen Stock Exchange The Shenzhen Stock Exchange
Shenzhen Listing Rules Rules Governing the Listing of Stocks on the Shenzhen Stock Exchange
Hong Kong Stock Exchange
The Stock Exchange of Hong Kong Limited
Hong Kong Listing Rules Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited
SFO Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong)
PRC ASBEs Generally accepted accounting principles in the PRC
HKFRSs Hong Kong Financial Reporting Standards (including Hong Kong Accounting Standards (HKASs) and Interpretations)
China All Access China All Access (Holdings) Limited
ZTE HK ZTE (H.K.) Limited
ANNUAL REPORT 2014
3
Speed Huizhou Speed Wireless Technology Co., Ltd.
ZTE Capital Shenzhen ZTE Capital Management Company Limited
Zhonghe Chunsheng Fund Shenzhen Zhonghe Chunsheng Partnership Private Equity Fund I
Zhongxingxin Shenzhen Zhongxingxin Telecommunications Equipment Company Limited
Mobi Antenna Mobi Antenna Technologies (Shenzhen) Co., Ltd.
Huatong Huatong Technology Company Limited
Nanchang Software Zhongxing Software Technology (Nanchang) Company Limited
Zhongxing Hetai Shenzhen Zhongxing Hetai Hotel Investment and Management Company Limited
Zhongxing Development Zhongxing Development Company Limited
Chongqing Zhongxing Development
Chongqing Zhongxing Development Company Limited
Xian Microelectronics Xian Microelectronics Technology Research Institute
Aerospace Guangyu Shenzhen Aerospace Guangyu Industrial Company Limited
Zhongxing WXT Shenzhen Zhongxing WXT Equipment Company Limited
Zhongxing Software Shenzhen Zhongxing Software Company Limited
ZTE Kangxun Shenzhen ZTE Kangxun Telecom Company Limited
ZTE Group Finance ZTE Group Finance Co., Ltd.
ZTE CORPORATION
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GlossaryThis glossary contains definitions of certain technical terms used in this report as they relate to the Group. Some of these definitions may not correspond to standard industry definitions or usage.
2G Second-generation mobile networks featuring digital wireless radio technology that enables larger network capacity, improved voice quality and more secure encryption, as well as seamless international roaming for users which includes GSM and CDMA. GSM (Global System for Mobile Communication) is a global system for cellular mobile communications originated in Europe using TDMA, while CDMA is a standard for spread spectrum technology. The data rate of 2G can reach 115.2Kbps. The data rate of GSM using EDGE (enhanced data rate for GSM evolution) can reach 384Kbps.
3G Third-generation mobile networks supporting peak data rate of 144Kbps at mobile user speeds, 384Kbps at pedestrian user speeds and 2Mbps at fixed locations.
4G Fourth-generation mobile networks operating according to IMT-Advanced standards as defined by ITU, including LTE-Advanced and Wireless MAN-Advanced (802.16m) standards, which support theoretical download rates of 1Gbit/s at fixed locations and 100Mbit/s in motion.
5G Fifth-generation mobile communications, which is a general reference to the ensemble of post-4G broadband wireless communication technologies. The general view of the industry is that 5G is capable of providing faster data throughput (1,000 times faster than what is currently available) and more connections (100 times more than what is currently available), more efficient utilisation of energy (10 times of the current level of efficiency) and shorter end-to-end time delay (1/5 of the current length of time delay). It goes beyond human-to-human communication to cover a wide range of applications such as ultra-intensive networks, machine-to-machine communication and the internet of vehicles.
Pre-5G The adoption of the 5G technology without modifying existing air interfaces standards, providing in advance a 5G-like user experience on existing terminals.
UMTS A reference to WCDMA standards general