Announcement Of Xinye Textile On Eliminating Backward Equipment And Rebuilding Compact Spinning Project

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All members of the company and the board of Directors ensure that the contents of the announcement are true, accurate and complete, and assume responsibility for false statements, misleading statements or major omissions in the announcement.

In order to improve the profitability of the company, the company decided to eliminate backward non-standard spindles 20 thousand and 1080

Taiwan 56 inches shuttle loom equipment, converted into compact spinning project.

The total investment amount of the project is 260 million yuan, of which 70 million yuan is raised by enterprises and 190 million yuan by bank loans.

We mainly purchase advanced combing machines, combing machines and compact spinning equipment at home and abroad, developing and producing high-grade compact spinning.

The project is implemented in the existing plant, and the infrastructure projects such as reconstruction of the corresponding trenches and supporting houses are invested about 30 million yuan. The investment in machinery and equipment is about 160 million yuan and the working capital is 70 million yuan.

The project is scheduled to start construction in March 2011, with a construction period of one year.

The project conforms to the national industrial structure adjustment plan, and belongs to the encouraged category of the guidance list of industrial restructuring (2005 Edition).

Compared with ordinary ring spinning, compact spinning has the advantages of less yarn hairiness, high yarn strength and high elongation. It belongs to the textile high and new technology achievement.

According to the market demand analysis at home and abroad, because people advocate the return to nature consumption psychology, they are especially fond of pure cotton products. The high and medium count pure cotton combed yarn is very popular. It is a popular variety at home and abroad. It has wide application and high added value. It has broad prospects both in the international market and in the domestic market.

After the implementation of this project, the economic benefit is remarkable. It is estimated that the annual output of compact spinning is about 6000 tons, with an average annual sales income of 330 million yuan and a total profit of 52 million 360 thousand yuan.

The advanced spinning technology of this project has laid a reliable technical foundation for producing high-grade cotton yarn.

It will have a positive impact on improving the company's tooling level and enhancing product competitiveness.

The original value of the project eliminated equipment is 16 million yuan, the accumulated depreciation is 15 million 300 thousand yuan, and the book value is net.

700 thousand yuan.

The above motion has been adopted by the sixth session of the eighteenth meeting of the board of directors.

This is hereby announced.

Henan Xinye textile Limited by Share Ltd board of directors

December 3, 2010