This excerpt taken from the CHNR 6-K filed Oct 5, 2006.
PRO FORMA CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED)
On July 31, 2006, China Natural Resources, Inc. (the Company) consummated the sale of all the issued and outstanding capital stock of iSense Limited (iSense), a wholly-owned Hong Kong Corporation acquired by the Company in 2003. The stock was sold to the former owner and a current director of iSense for RMB2,080,000 (US$258,000) (based upon the exchange rate on December 31, 2005). On October 3, 2006, the Company consummated the sale of its complete ownership interest in the capital stock of Hainan Cihui Industrial Company Limited (HARC) to Allied Clear Investments Limited, an unaffiliated British Virgin Islands (BVI) corporation for RMB31,200,000 (US$3,866,000) (based upon the exchange rate on December 31, 2005).
The pro forma consolidated statement of operations for the year ended December 31, 2005 is based on the historical financial statements of the Company and has been prepared assuming the sale of HARC and iSense was completed on January 1, 2005. The pro forma consolidated balance sheet as of December 31, 2005 assumes the sale of HARC and iSense was completed on December 31, 2005. The unaudited pro forma financial statement information is presented for informational purposes only. The pro forma balance sheet and statement of operations do not purport to represent what the Companys actual financial position or results of operations would have been had the sale of HARC and iSense occurred as of such dates, or to project the Companys financial position or results of operations for any period or date, nor does it give effect to any matters other than those described in the notes thereto. The unaudited pro forma financial information should be read in conjunction with the Companys consolidated financial statements and notes thereto for the year ended December 31, 2005 filed on Form 20-F on June 12, 2006 and to the Companys Form 6-K filed on June 19, 2006.
Certain assumptions, estimates and adjustments are preliminary and have been made solely for purposes of developing such pro forma information. The pro forma adjustments are based on preliminary estimates and certain assumptions that the Company believes are reasonable under the circumstances.
The functional currency of all the operations of the Company is the Renminbi (RMB), the national currency of the Peoples Republic of China. The translation of amounts from RMB into US$ is included solely for the convenience of the reader and has been made at the rate of exchange quoted by the Peoples Bank of China on December 31, 2005 of US$1.00 = RMB8.07. No representation is made that the RMB amounts could have been, or could be, converted into US$ at that rate on December 31, 2005 or at any other date.