Shenzhen China Bicycle Company (Holdings) Limited First Quarterly Report 2019 April 2019 1 Section I. Important Notes Board of Directors and the Supervisory Committee of Shenzhen China Bicycle Company (Holdings) Limited (hereinafter referred to as the Company) and its directors, supervisors and senior executives should guarantee the reality, accuracy and completion of the quarterly report, there are no any fictitious statements, misleading statements or important omissions carried in this report, and shall take legal responsibilities, individual and/or joint. All Directors are attended the Board Meeting for Quarterly Report deliberation. Li Hai, person in charge of the Company, Sun Longlong, person in charge of accounting works and Zhong Xiaojin, person in charge of accounting organ (accounting officer) hereby confirm that the Financial Report of this Quarterly Report is authentic, accurate and complete. 2 Section II. Basic Information of the Company I. Main accounting data and financial indexes Whether it has retroactive adjustment or re-statement on previous accounting data □ Yes √No Changes of this period over Current Period Same period of last year same period of last year Operating income (RMB) 21,954,108.28 24,732,886.83 -11.24% Net profit attributable to shareholders of -366,774.37 231,983.23 -258.10% the listed company (RMB) Net profit attributable to shareholders of the listed company after deducting -410,571.37 178,793.22 -329.63% non-recurring gains and losses (RMB) Net cash flow arising from operating -6,105,394.21 832,923.62 -833.01% activities (RMB) Basic earnings per share (RMB/Share) -0.0007 0.0004 -275.00% Diluted earnings per share (RMB/Share) -0.0007 0.0004 -275.00% Weighted average ROE -2.60% 1.45% -4.05% Changes of this period-end At the end of the reporting At the end of last year over same period-end of last period year Total assets (RMB) 70,699,083.94 73,242,960.17 -3.47% Net assets attributable to shareholder of 13,939,527.57 14,306,301.94 -2.56% listed company (RMB) Items of non-recurring gains and losses √ Applicable □ Not applicable In RMB Item Amount from year-begin to Note 3 period-end Other non-operating income and expenditure except for the 58,396.00 aforementioned items Less: Impact on income tax 14,599.00 Impact on minority shareholders’ equity (post-tax) 0.00 Total 43,797.00 -- Concerning the extraordinary profit (gain)/loss defined by Q&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to the Public --- Extraordinary Profit/loss, and the items defined as recurring profit (gain)/loss according to the lists of extraordinary profit (gain)/loss in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to the Public --- Extraordinary Profit/loss, explain reasons □ Applicable √ Not applicable In reporting period, the Company has no particular about items defined as recurring profit (gain)/loss according to the lists of extraordinary profit (gain)/loss in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to the Public --- Extraordinary Profit/loss II. Total number of shareholders at the end of this report period and top ten shareholders 1. Total number of common shareholders and preference shareholders with voting rights recovered and top ten common shareholders In share Total number of common Total preference shareholders with shareholders at the end of report 51,969 voting rights recovered at end of 0 period reporting period (if applicable) Top ten shareholders Amount of Number of share pledged/frozen Shareholder’s Nature of Proportion of Amount of shares restricted shares name shareholder shares held held State of share Amount held Shenzhen Guosheng Energy Domestic Investment non-State-owned 11.52% 63,508,747 0 - - Development legal person Co., Ltd. UOB Koy Hian Foreign legal (Hongkong) Co., 2.89% 15,907,850 0 - - person Ltd. Guosen Securities (Hongkong) Foreign legal 2.52% 13,909,425 0 - - brokerage Co., person Ltd. 4 Shenwan Hongyuan Foreign legal Securities 1.20% 6,631,116 0 - - person (Hongkong) Co., Ltd. Domestic nature Li Huili 0.71% 3,891,124 0 - - person Domestic nature Tian Qibing 0.54% 2,981,100 0 - - person CMS Hong Kong State-owned legal 0.54% 2,955,352 0 - - Co., Ltd person Domestic nature Xu Hongbo 0.50% 2,744,419 0 - - person Special Account for Property Domestic Disposal of non-State-owned 0.47% 2,602,402 0 - - Bankrupt legal person Enterprise of CBC Domestic nature Ge Zhiqiong 0.41% 2,279,152 0 - - person Top ten shareholders with unrestricted shares held Type of shares Shareholder’s name Amount of unrestricted shares held Type Amount Shenzhen Guosheng Energy RMB common 63,508,747 63,508,747 Investment Development Co., Ltd. shares Domestically UOB Koy Hian (Hongkong) Co., 15,907,850 listed foreign 15,907,850 Ltd. shares Domestically Guosen Securities (Hongkong) 13,909,425 listed foreign 13,909,425 brokerage Co., Ltd. shares Domestically Shenwan Hongyuan Securities 6,631,116 listed foreign 6,631,116 (Hongkong) Co., Ltd. shares Domestically Li Huili 3,891,124 listed foreign 3,891,124 shares Tian Qibing 2,981,100 RMB common 2,981,100 5 shares Domestically CMS Hong Kong Co., Ltd 2,955,352 listed foreign 2,955,352 shares Domestically Xu Hongbo 2,744,419 listed foreign 2,744,419 shares RMB common 1,383,313 Special Account for Property shares Disposal of Bankrupt Enterprise of 2,602,402 Domestically CBC listed foreign 1,219,089 shares Domestically Ge Zhiqiong 2,279,152 listed foreign 2,279,152 shares Li Huili, spouse of the Ji Hanfei, the actual controller of he Company- Shenzhen Guosheng Energy Investment Development Co., Ltd., holding B-share of the Company on behalf of Explanation on associated Shenzhen Guosheng Energy Investment Development Co., Ltd., beyond that, the Company relationship among the aforesaid has no idea of whether other circulated shareholders belong to concerted action persons ruled shareholders in the Administration Norms for Information Disclosure of Change on Shareholding of Shareholders of Listed Companies. Explanation on top ten common shareholders involving margin N/A business (if applicable) Whether top ten common shareholders or top ten common shareholders with un-restrict shares held have a buy-back agreement dealing in reporting period □ Yes √ No The top ten common shareholders or top ten common shareholders with un-restrict shares held of the Company have no buy-back agreement dealing in reporting period. 2. Total shareholders with preferred stock held and shares held by top ten shareholders with preferred stock held □ Applicable √ Not applicable 6 Section III. Significant Event I. Particulars about material changes in items of main accounting statement and financial index and explanations of reasons √ Applicable □ Not applicable Ending or the Opening or last Increase/decrease Item Reasons of changes period period y-o-y Monetary fund 12,383,492.05 18,488,886.26 -33.02% Taxes for end of last year are paid in January Note receivable and account 38,166,569.57 29,007,509.02 31.57% Acceptance bill held at period-end receivable increased and account receivable goes up due to the stock for peak seasons from clients Account paid in advance 7,601,965.06 13,799,753.60 -44.91% The account paid in advance for lithium battery materials business last year, have delivery in succession Inventory 3,480,243.31 2,386,603.94 45.82% Stock increased for sales peak season from subsidiary in the period Tax payable 931,359.17 6,297,096.28 -85.21% Basically be this period pays go up to should hand in duty to expend Operating cash outflow subtotal 12,742,516.52 6,704,030.73 90.07% Basically be this period pays go up to should hand in duty to expend II. Analysis and explanation of significant events and their influence and solutions □ Applicable √ Not applicable Implementation progress of shares buy-back □ Applicable √ Not applicable Implementation progress of the reduction of repurchases shares by centralized bidding □ Applicable √ Not applicable III. Commitments completed in Period and those without completed till end of the Period from actual controller, shareholders, related parties, purchaser and companies □ Applicable √ Not applicable The Company has no commitments completed in Period and those without completed till end of the Period from actual controller, 7 shareholders, related parties, purchaser and companies. IV. Predict of the business performance from January to June 2019 Warnings and reasons of the predict that the cumulative net profit from the begin of the year to the end of next report period may be loss or have great changes comparing with the same period of last year □ Applicable √ Not applicable V. Securities Investment □ Applicable √ Not applicable No security investment in Period. VI. Derivative investment □ Applicable √ Not applicable No derivative investment in the Period. VII. Registration form for receiving research, communication and interview in the report period √ Applicable □ Not applicable Time Way Type Basic situation index of investigation Consulting company restructuring Jan.- Mar. of 2019 Telephone communication Individual problem Jan.- Mar. of 2019 Telephone communication Individual Inquiry progress of the private placement VIII. Guarantee outside against the regulation □Applicable √Not applicable The Company had no guarantee outside against the regulation in the period. IX. Non-operational fund occupation from controlling shareholders and its related party □ Applicable √ Not applicable The Company had no non-operational fund occupation form controlling shareholders and its related party in the period. 8 Section IV. Financial Statement I. Financial statement 1. Consolidate balance sheet Prepared by Shenzhen China Bicycle Company (Holdings) Limited 2019-03-31 In RMB Item 2019-3-31 2018-12-31 Current assets: Monetary fund 12,383,492.05 18,488,886.26 Monetary fund Settlement provisions Capital lent Transactional financial assets Financial assets measured by fair value and with variation reckoned into current gains/losses Note receivable and account 38,166,569.57 29,007,509.02 receivable Including: Notes receivable 3,157,964.00 Accounts receivable 35,008,605.57 29,007,509.02 Account paid in advance 7,601,965.06 13,799,753.60 Insurance receivable Reinsurance receivables Contract reserve of reinsurance receivable Other account receivable 767,977.15 844,537.19 Including: Interest receivable Dividends receivable Buying back the sale of financial assets Inventories 3,480,243.31 2,386,603.94 Contractual assets 9 Assets held for sale Non-current assets maturing within one year Other current assets 2,130,677.11 2,266,241.66 Total current assets 64,530,924.25 66,793,531.67 Non-current assets: Loans and payments on behalf Debt investment Available-for-sale financial assets Other debt investment Held-to-maturity investments Long-term receivables Long-term equity investments Investment in other equity instrument Other non-current financial assets Investment real estate Fixed assets 3,409,788.51 3,502,807.32 Construction in progress Productive biological assets Oil and natural gas assets Right-of-use assets Intangible assets 1,317,750.00 1,506,000.00 Research and development costs Goodwill Long-term deferred expenses Deferred income tax assets 1,040,621.18 1,040,621.18 Other non-current assets 400,000.00 400,000.00 Total non-current assets 6,168,159.69 6,449,428.50 Total assets 70,699,083.94 73,242,960.17 Current liabilities Short-term borrowings Loan from central bank Capital borrowed Transactional financial liability 10 Financial liability measured by fair value and with variation reckoned into current gains/losses Derivative financial liability Notes payable & account payable 14,708,000.37 11,979,010.69 Accounts received in advance 239,269.87 405,779.88 Selling financial asset of repurchase Absorbing deposit and interbank deposits Agent buying and selling securities Acting underwriting securities Wage payable 539,482.96 435,736.16 Tax payable 931,359.17 6,297,096.28 Other accounts payable 37,784,838.87 37,144,872.42 Including: Interest payable Dividend payable Handling fees and commissions payable Reinsurance payable Contractual liability Liability held for sale Non-current liabilities due within one year Other current liabilities Total current liabilities 54,202,951.24 56,262,495.43 Non-current liabilities: Insurance contract reserve Long-term loans Bonds payable Including: preferred stock Perpetual capital securities Lease liability Long-term account payable Long term employee compensation payable 11 Accrued liabilities Deferred income Deferred income tax liabilities Other non-current liabilities Total non-current liabilities Total liabilities 54,202,951.24 56,262,495.43 Owners’ equity: Share capital 551,347,947.00 551,347,947.00 Other equity instrument Including: preferred stock Perpetual capital securities Capital public reserve 627,834,297.85 627,834,297.85 Less: Inventory shares Other comprehensive income Special reserve Surplus reserve 32,673,227.01 32,673,227.01 Provision of general risk Retained profit -1,197,915,944.29 -1,197,549,169.92 Total owner’s equity attributable to parent 13,939,527.57 14,306,301.94 Company Minority interests 2,556,605.13 2,674,162.80 Total owner’s equity 16,496,132.70 16,980,464.74 Total liabilities and owner’s equity 70,699,083.94 73,242,960.17 Legal representative: Li Hai Person in charge of accounting works: Sun Longlong Person in charge of accounting organ: Zhong Xiaojin 2. Balance Sheet of Parent Company In RMB Item 2019-3-31 2018-12-31 Current assets: Monetary fund 3,798,982.34 8,889,572.73 Transactional financial assets Financial assets measured by fair 12 value and with variation reckoned into current gains/losses Derivative financial assets Note receivable and account 20,314,157.26 12,827,954.16 receivable Including: Notes receivable 707,964.00 Accounts receivable 19,606,193.26 12,827,954.16 Account paid in advance 7,600,663.94 13,798,452.48 Other account receivable 380,925.78 380,925.78 Including: Interest receivable Dividends receivable Inventories Contractual assets Assets held for sale Non-current assets maturing within one year Other current assets 2,130,677.11 2,130,677.11 Total current assets 34,225,406.43 38,027,582.26 Non-current assets: Debt investment Available-for-sale financial assets Other debt investment Held-to-maturity investments Long-term receivables Long-term equity investments 10,379.73 10,379.73 Investment in other equity instrument Other non-current financial assets Investment real estate Fixed assets 2,934,964.50 2,995,407.48 Construction in progress Productive biological assets Oil and natural gas assets Right-of-use assets Intangible assets 1,317,750.00 1,506,000.00 Research and development costs 13 Goodwill Long-term deferred expenses Deferred income tax assets Other non-current assets 400,000.00 400,000.00 Total non-current assets 4,663,094.23 4,911,787.21 Total assets 38,888,500.66 42,939,369.47 Current liabilities Short-term borrowings Transactional financial liability Financial liability measured by fair value and with variation reckoned into current gains/losses Derivative financial liability Notes payable & account payable 333,520.00 Accounts received in advance 327,632.18 Contractual liability Wage payable 151,263.89 151,598.60 Taxes payable 170,764.14 5,416,117.27 Other accounts payable 30,248,457.31 28,967,052.96 Including: Interest payable Dividend payable Liability held for sale Non-current liabilities due within one year Other current liabilities Total current liabilities 30,904,005.34 34,862,401.01 Non-current liabilities: Long-term loans Bonds payable Including: preferred stock Perpetual capital securities Lease liability Long-term account payable Long term employee compensation payable 14 Accrued liabilities Deferred income Deferred income tax liabilities Other non-current liabilities Total non-current liabilities Total liabilities 30,904,005.34 34,862,401.01 Owners’ equity: Share capital 551,347,947.00 551,347,947.00 Other equity instrument Including: preferred stock Perpetual capital securities Capital public reserve 627,834,297.85 627,834,297.85 Less: Inventory shares Other comprehensive income Special reserve Surplus reserve 32,673,227.01 32,673,227.01 Retained profit -1,203,870,976.54 -1,203,778,503.40 Total owner’s equity 7,984,495.32 8,076,968.46 Total liabilities and owner’s equity 38,888,500.66 42,939,369.47 3. Consolidated Profit Statement In RMB Item Current Period Last Period I. Total operating income 21,954,108.28 24,732,886.83 Including: Operating income 21,954,108.28 24,732,886.83 Interest income Insurance gained Handling fees and commissions income II. Total operating cost 22,496,836.32 24,497,325.06 Including: Operating cost 20,264,348.28 22,815,921.16 Interest expense Handling fees and commissions expenses 15 Cash surrender value Net amount of expense of compensation Net amount of withdrawal of insurance contract reserve Bonus expense of guarantee slip Reinsurance expense Taxes and surcharge 20,782.52 13,045.78 Sales expenses 1,264,109.25 1,088,883.41 Administration expenses 959,163.70 792,355.78 R&D expenses Financial expenses -11,567.43 -212,881.07 Including: interest expenses Interest income -20,266.08 -220,576.67 Losses of devaluation of asset Loss of credit impairment Add: other income Investment income (Loss is listed with “-”) Including: Investment income on affiliated Company and joint venture Exchange income (Loss is listed with “-”) Net exposure hedging income (Loss is listed with “-”) Changing income of fair value(Loss is listed with “-”) Income on disposal of assets (Loss is listed with “-”) III. Operating profit (Loss is listed with “-”) -542,728.04 235,561.77 Add: Non-operating income 58,396.00 72,126.28 Less: Non-operating expense IV. Total Profit (Loss is listed with “-”) -484,332.04 307,688.05 Less: Income tax 104,059.89 V. Net profit (Net loss is listed with “-”) -484,332.04 203,628.16 (i) Classify by business continuity 16 1.continuous operating net profit (net loss -484,332.04 203,628.16 listed with ‘-”) 2.termination of net profit (net loss listed with ‘-”) (ii) Classify by ownership 1.Net profit attributable to owner’s of parent -366,774.37 231,983.23 company 2.Minority shareholders’ gains and losses -117,557.67 -28,355.07 VI. Net after-tax of other comprehensive income Net after-tax of other comprehensive income attributable to owners of parent company (I) Other comprehensive income items which will not be reclassified subsequently to profit of loss 1.Changes of the defined benefit plans that re-measured 2.Other comprehensive income under equity method that cannot be transfer to gain/loss 3.Change of fair value of investment in other equity instrument 4.Fair value change of enterprise's credit risk 5. Other (II) Other comprehensive income items which will be reclassified subsequently to profit or loss 1.Other comprehensive income under equity method that can transfer to gain/loss 2.Change of fair value of other debt investment 3.gain/loss of fair value changes for available-for-sale financial assets 4.Amount of financial assets re-classify to other comprehensive income 5.Gain/loss of held-to-maturity investments that re-classify to available-for-sale financial asset 17 6.Credit impairment provision for other debt investment 7.Cash flow hedging reserve 8.Translation differences arising on translation of foreign currency financial statements 9.Other Net after-tax of other comprehensive income attributable to minority shareholders VII. Total comprehensive income -484,332.04 203,628.16 Total comprehensive income attributable -366,774.37 231,983.23 to owners of parent Company Total comprehensive income attributable to -117,557.67 -28,355.07 minority shareholders VIII. Earnings per share: (i) Basic earnings per share -0.0007 0.0004 (ii) Diluted earnings per share -0.0007 0.0004 Enterprise combine under the same control in the Period, the combined party realized net profit of 0 Yuan before combination, and realized 0 Yuan at last period for combined party Legal representative: Li Hai Person in charge of accounting works: Sun Longlong Person in charge of accounting organ: Zhong Xiaojin 4. Profit Statement of Parent Company In RMB Item Current Period Last Period I. Operating income 11,039,480.41 7,029,187.86 Less: Operating cost 10,432,579.67 6,438,488.68 Taxes and surcharge 6,144.20 Sales expenses 131,886.99 64,825.20 Administration expenses 626,307.15 232,817.86 R&D expenses Financial expenses -6,568.46 -41,043.41 Including: interest expenses Interest income -10,138.70 -44,408.28 18 Losses of devaluation of asset Loss of credit impairment Add: other income Investment income (Loss is listed with “-”) Including: Investment income on affiliated Company and joint venture Net exposure hedging income (Loss is listed with “-”) Changing income of fair value(Loss is listed with “-”) Income on disposal of assets (Loss is listed with “-”) II. Operating profit (Loss is listed with -150,869.14 334,099.53 “-”) Add: Non-operating income 58,396.00 68,105.41 Less: Non-operating expense III. Total Profit (Loss is listed with “-”) -92,473.14 402,204.94 Less: Income tax 104,059.89 IV. Net profit (Net loss is listed with -92,473.14 298,145.05 “-”) (i)continuous operating net profit -92,473.14 298,145.05 (net loss listed with ‘-”) (ii) termination of net profit (net loss listed with ‘-”) V. Net after-tax of other comprehensive income (I) Other comprehensive income items which will not be reclassified subsequently to profit of loss 1.Changes of the defined benefit plans that re-measured 2.Other comprehensive income under equity method that cannot be transfer to gain/loss 3.Change of fair value of investment in other equity instrument 4.Fair value change of 19 enterprise's credit risk 5. Other (II) Other comprehensive income items which will be reclassified subsequently to profit or loss 1.Other comprehensive income under equity method that can transfer to gain/loss 2.Change of fair value of other debt investment 3.gain/loss of fair value changes for available-for-sale financial assets 4.Amount of financial assets re-classify to other comprehensive income 5.Gain/loss of held-to-maturity investments that re-classify to available-for-sale financial asset 6.Credit impairment provision for other debt investment 7.Cash flow hedging reserve 8.Translation differences arising on translation of foreign currency financial statements 9.Other VI. Total comprehensive income -92,473.14 298,145.05 VII. Earnings per share: (i) Basic earnings per share -0.0002 0.0005 (ii) Diluted earnings per share -0.0002 0.0005 5. Consolidated Cash Flow Statement In RMB Item Current Period Last Period I. Cash flows arising from operating activities: 20 Cash received from selling commodities and providing labor 4,648,357.26 5,982,298.36 services Net increase of customer deposit and interbank deposit Net increase of loan from central bank Net increase of capital borrowed from other financial institution Cash received from original insurance contract fee Net cash received from reinsurance business Net increase of insured savings and investment Net increase of amount from disposal financial assets that measured by fair value and with variation reckoned into current gains/losses Cash received from interest, commission charge and commission Net increase of capital borrowed Net increase of returned business capital Net cash received by agents in sale and purchase of securities Write-back of tax received Other cash received concerning 1,988,765.05 1,554,655.99 operating activities Subtotal of cash inflow arising from 6,637,122.31 7,536,954.35 operating activities Cash paid for purchasing commodities and receiving labor 3,324,815.98 3,072,699.30 service Net increase of customer loans and advances Net increase of deposits in central bank and interbank 21 Cash paid for original insurance contract compensation Net increase of financial assets held for transaction purposes Net increase of capital lent Cash paid for interest, commission charge and commission Cash paid for bonus of guarantee slip Cash paid to/for staff and workers 1,454,436.46 1,530,704.56 Vary tax paid 5,266,314.48 533,348.11 Other cash paid concerning 2,696,949.60 1,567,278.76 operating activities Subtotal of cash outflow arising from 12,742,516.52 6,704,030.73 operating activities Net cash flows arising from operating -6,105,394.21 832,923.62 activities II. Cash flows arising from investing activities: Cash received from recovering investment Cash received from investment income Net cash received from disposal of fixed, intangible and other long-term assets Net cash received from disposal of subsidiaries and other units Other cash received concerning investing activities Subtotal of cash inflow from investing activities Cash paid for purchasing fixed, intangible and other long-term assets Cash paid for investment Net increase of mortgaged loans Net cash received from subsidiaries and other units obtained 22 Other cash paid concerning investing activities Subtotal of cash outflow from investing activities Net cash flows arising from investing activities III. Cash flows arising from financing activities Cash received from absorbing investment Including: Cash received from absorbing minority shareholders’ investment by subsidiaries Cash received from loans Cash received from issuing bonds Other cash received concerning 328,378.06 financing activities Subtotal of cash inflow from financing 328,378.06 activities Cash paid for settling debts Cash paid for dividend and profit distributing or interest paying Including: Dividend and profit of minority shareholder paid by subsidiaries Other cash paid concerning 2,000,000.00 financing activities Subtotal of cash outflow from 2,000,000.00 financing activities Net cash flows arising from financing -2,000,000.00 328,378.06 activities IV. Influence on cash and cash equivalents due to fluctuation in exchange rate V. Net increase of cash and cash -8,105,394.21 1,161,301.68 equivalents Add: Balance of cash and cash 16,488,886.26 19,177,276.18 equivalents at the period -begin 23 VI. Balance of cash and cash 8,383,492.05 20,338,577.86 equivalents at the period -end 6. Cash Flow Statement of Parent Company In RMB Item Current Period Last Period I. Cash flows arising from operating activities: Cash received from selling commodities and providing labor 369,800.00 services Write-back of tax received Other cash received concerning 2,378,627.59 1,331,116.28 operating activities Subtotal of cash inflow arising from 2,748,427.59 1,331,116.28 operating activities Cash paid for purchasing commodities and receiving labor 129,062.00 1,861.33 service Cash paid to/for staff and workers 642,831.68 518,277.64 Vary tax paid 5,153,942.70 412,529.68 Cash paid for other operation 1,913,181.60 936,897.95 activity Subtotal of cash outflow arising from 7,839,017.98 1,869,566.60 operating activities Net cash flows arising from operating -5,090,590.39 -538,450.32 activities II. Cash flows arising from investing activities: Cash received from recovering investment Cash received from investment income Net cash received from disposal of fixed, intangible and other long-term assets Net cash received from disposal of subsidiaries and other units 24 Other cash received concerning investing activities Subtotal of cash inflow from investing activities Cash paid for purchasing fixed, intangible and other long-term assets Cash paid for investment Net cash received from subsidiaries and other units obtained Other cash paid concerning investing activities Subtotal of cash outflow from investing activities Net cash flows arising from investing activities III. Cash flows arising from financing activities Cash received from absorbing investment Cash received from loans Cash received from issuing bonds Other cash received concerning financing activities Subtotal of cash inflow from financing activities Cash paid for settling debts Cash paid for dividend and profit distributing or interest paying Other cash paid concerning financing activities Subtotal of cash outflow from financing activities Net cash flows arising from financing activities IV. Influence on cash and cash equivalents due to fluctuation in exchange rate V. Net increase of cash and cash -5,090,590.39 -538,450.32 25 equivalents Add: Balance of cash and cash 8,889,572.73 15,398,405.80 equivalents at the period -begin VI. Balance of cash and cash 3,798,982.34 14,859,955.48 equivalents at the period -end II. Explanation on financial statement adjustment 1. Financial statement adjustment at the beginning of the first year when implementation of new financial instrument rules, new revenue rules and new leasing rules □Applicable √Not applicable 2. Retrospective adjustment of the comparative data for initial implementation of new financial instrument rules and new leasing rules □Applicable √Not applicable III. Audit report Whether the 1st quarterly report has been audited or not □Yes √ No The 1st quarterly report of the Company was unaudited. Board of Directors of Shenzhen China Bicycle Company (Holdings) Limited 29 April 2019 26